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TMI Blog2018 (2) TMI 345X X X X Extracts X X X X X X X X Extracts X X X X ..... usehold expenses for f.y. 2007-08, in line with that for the current year, be taken at ₹ 1,80,000/-, as fairly agreed to by the counsel during hearing; (c) the closing cash balance for A.Y. 2008-09, i.e., as on 31.03.2008, so arrived at, shall be the opening cash balance for the current year; (d) the A.O. shall verify the CFS for the current year, prepared, similarly, aggregating all the bank accounts of the assessee, adopting the correct figures; (e) the cash flow statement for the current year (AY 2009-10) be redrawn accordingly; and (f) the shortfall in cash as at the year-end (31.03.2009), if any, would stand to be confirmed, instead of ₹ 4.67 lacs, and the cash balance as on 01/04/2009 be taken at nil. Where pos ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2,56,000 Add: Cash withdrawals from saving a/c during the year 26,83,190 Add: Cash transfer from S/A 36141 2,35,000 Less: H/H withdrawals during the year 2,00,000 Less: Amount invested for purchase of agricultural land 19,95,000 21,95,000 Balance account 18,24,569 Less: Cash deposited in ICICI Bank during the year 14,45,800 Balance cash in hand (as on 31.03.2009) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e heard the parties, and perused the material on record. Our first observation in the matter is that the assessee has not led any evidence even during the first appellate stage with regard to the paying guest house business, which was the prime reason for the Assessing Officer in not accepting the assessee s cash flow statement, filed in explanation, even as he does not disturb the assessee s income from, as stated, paying guest house business, returned on estimated basis, being sans any books of account. Two, the cash withdrawals from the bank, made on a regular basis, could form a valid basis for the cash deposits in the bank account where, for example, there is trading activity or the existence of the business is proved, so that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and which would therefore require being verified by the AO . He would also fairly concede to an error in the cash flow statement for the year (refer para 3) in-as-much as it states the income for the year at ₹ 2.56 lacs, i.e., as against the correct figure of ₹ 1.56 lacs. This, again, endorses our earlier observation that there has been no verification of the CFS which is the assessee s explanation for the cash deposited in her bank account, by either the assessing or the first appellate authority. The assessee before us sought to justify the opening cash-in-hand by furnishing a cash flow statement for the immediately preceding year (i.e., f.y. 2007-08), as under, drawn, as stated, on the basis of the bank account for the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted by him as unsubstantiated, so that it could be revised to a figure deemed reasonable by the Bench, further stating that these adjustments would though not adversely impact the assessee in-as-much as the shortfall - which is the reason for the addition to the extent confirmed, stands neutralized, and would only go to reduce the closing balance of the cash-in-hand as on 31.03.2009, arrived at ₹ 3.78 lacs. 5. We, in view of the foregoing, accordingly, hold as under: (a) the AO shall vet the cash flow statement (summarized at PB page 10) for f.y. 2007-08 for the veracity of the various figures (with reference to the records, vizbank statement, assessed income), as well as its calculation. Needless to all, the CFS shall be for al ..... X X X X Extracts X X X X X X X X Extracts X X X X
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