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TMI Blog2016 (8) TMI 461X X X X Extracts X X X X X X X X Extracts X X X X ..... 8377; 48,39,641/- by making disallowance of ₹ 2,22,717/- being 5% of the purchases. Therefore, when the very same bank account was not disclosed for this year also, we do not find any reason as to why the AO has taxed the entire deposit of ₹ 75,44,655/- especially when the bank account contains both debit entries and credit entries. Therefore, we are of the considered opinion that those debit entries cannot be ignored altogether. Since the Ld.CIT(A) after considering the totality of the facts of the case has sustained addition of ₹ 15,30,602/- which is the peak credit in the bank account as on 29-12-2009, therefore, we do not find any infirmity in the order of CIT(A) - ITA No.718/PN/2014 - - - Dated:- 30-6-2016 - SHRI R ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r the year ended 31-03-2010 as per which the gross profit was worked out at ₹ 7,47,771/- on the total sales of ₹ 75,44,653/-. The net profit was worked out at ₹ 6,03,973/- which amounts to 8.01% of the turnover. It was accordingly requested that the profit of ₹ 6,03,973/- representing his income from sale proceeds of his undisclosed business may be taxed. 3. However, the AO was not satisfied with the explanation given by the assessee. He observed that the said bank account was never disclosed and the transactions carried out in the bank account was also not disclosed. As regards the reply of the assessee that he has deposited the amount from time to time is concerned, the AO held that the same is also not justifia ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... account amounting to ₹ 48,39,641/-. The above amount was determined by disallowing an amount of ₹ 2,22,717/- being 5% of the purchases over and above the net profit of ₹ 2,99,273/- determined by the assessee on account of such credit entries. Since in the impugned assessment year such profit works out to ₹ 6,03,973/- the same should have been accepted by the AO by making the disallowance of 5% of the purchases, i.e. ₹ 3,38,615/- and thereby making a net addition of ₹ 9,42,588/-. Relying on the decision of Hon ble Supreme Court in the case of Radhasaomi Satsang Vs. CIT reported in 193 ITR 321 it was submitted that principle of resjudicata should be observed in tax proceedings also unless there was signifi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... with HDFC Bank represent the sale proceeds of his business of sale of timber and plywood. Therefore, the credit entries in the bank account remained unexplained and unsubstantiated. However, the whole of the credit entries cannot be added to the appellant's income because there are debit entries also, which have to be taken into account. From a perusal of the bank account, it is seen that the peak credit in the bank account for the year under consideration is ₹ 15,30,602/- as on 29.12.2009. Therefore, the addition on account of unexplained entries in the bank account of the appellant should have been made for this amount. Therefore, the addition on account of unexplained entries in the appellant's bank account is restricted to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r the assessee on the other hand heavily relied on the order of the CIT(A). He submitted that in the immediately preceding assessment year also the same AO has accepted the profit and loss account prepared by the assessee on the basis of the credit entries in the said HDFC bank account and further disallowed 5% of the purchases shown by the assessee in the said trading account and thereby had made addition of ₹ 5,21,990/- only as against the total deposits of ₹ 48,39,641/-. 9. Referring to the copy of the bank account he submitted that there were various debit entries and credit entries apart from certain cash deposits. The deposits in the said bank account has been treated as sale proceeds by the same AO in the preceding ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... de by both the sides, perused the orders of the AO and CIT(A) and the paper book filed on behalf of the assessee. We have also considered the various decisions cited before us. We find the assessee in the instant case has not disclosed the bank account maintained with HDFC Bank Ltd., where substantial deposits were made in cash as well as cheque. There are also various withdrawals from the said bank account. We find the AO rejecting the explanation given by the assessee that only profit should be taxed on the deposits, made addition of ₹ 75,44,775/- u/s.68 of the I.T. Act being the unexplained cash credits in the bank account maintained with HDFC Bank Ltd., the account number of which has already been given earlier. We find the Ld.CIT ..... X X X X Extracts X X X X X X X X Extracts X X X X
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