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TMI Blog2018 (9) TMI 965X X X X Extracts X X X X X X X X Extracts X X X X ..... tedly has got out of his bank account to some other beneficiary or layers through which the real beneficiary gets the ultimate benefit cannot be countenanced and not only that the department will not be able to recover the tax also from person of no means. Only if the real beneficiary is traced out the department will be able to recover the tax due to the State. So by making additions in wrong hands from whom tax cannot be recovered, help only the ultimate beneficiary and not even the department. Thus for the interest of justice and fair-play, we are inclined to delete the addition as ordered by the AO/Ld. CIT(A). The assessee’s bank account since used for deposit and transfer of cash is an activity for which a commission of 0.1% needs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Distributors. The assessee filed an affidavit dated 03.10.2012 wherein he asserted that all sorts of activities in whatever named may be called has been made either with the income tax deptt or with any other financial institution has been made without my consent and even a little bit I know about . However, according to AO, on 14.03.2013 as per recorded statement executed u/s. 131 of the Act the assessee clearly admitted the fact that all sorts of signatures are made by me every where which at present lies at your end or in future it may lies with you and I also like to add that the signature that I do and did as found in ICICI Bank either in the account opening form or any where else was made by me . So, according to AO, though the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ited in the bank it was immediately thereafter transferred to other accounts. To corroborate his (assessee s) contention, the statement of a colleague s i.e. Shri Rakesh Kumar Gupta who was working along with him has been also recorded by the AO u/s. 131 of the Act which we have perused. Though in the AO s order, the AO states that he had issued notices to 11 persons, but we note the statements of Shri Manish Agarwal and Shri Vikash Agarwal who were the employer of the assessee and who made him undergo the modus operandi i.e. (opening of bank accounts, deposit of cash and simultaneous withdrawal/transfer of the amount) has not taken place. As per the AO s order we note that only the name of assessee s colleague and a person acquainted by t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the light of the facts discussed above. The AO has not enquired into the veracity of the statement of assessee. The AO had the machinery at his disposal to expose the falsity if any in the statement of assessee. Simply picking out certain contradictions in the statement of assessee the AO cannot make a finding of fact that the cash deposited in the bank account is assessee s undisclosed income. And that too we note from the perusal of the statement of assessee, the contradiction was only in respect to fact of his opening of bank account and nothing more than that. Even if for argument sake, we agree with the AO that the bank account was opened by the assessee, the fact of him employed for ₹ 5000/- per month with Shri Manish Agarwal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e of ₹ 5000/- per month and that he owns immovable property etc, which action AO did not carry out. No effort to trace out the real beneficiary has been undertaken by the AO/Ld.CIT(A). According to the Ld. CIT(A), the assessee himself appeared before him and was conversant with the nuances of law which, according to Ld. CIT(A), cannot be that of a person with a meagre salary. We cannot accept such assumption of facts. Knowledge of law or ignorance of law of an assessee cannot be the yardstick to assume that a person is wealthy or not and the Ld. CIT(A) when making a finding of fact has to do it based on material/evidences. Rather, we note the whole addition is saddled upon the assessee on surmises and conjectures. It is not the case o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to route the cash through his bank account. In such a scenario, rather than finding out the real beneficiary in the whole modus operandi, the AO failed to collect any material or at least could not expose any falsity in the averments submitted by the assessee u/s. 131 of the Act. In such circumstances making huge addition in assessee s hand of the entire deposit of cash in his bank account which admittedly has got out of his bank account to some other beneficiary or layers through which the real beneficiary gets the ultimate benefit cannot be countenanced and not only that the department will not be able to recover the tax also from person of no means. Only if the real beneficiary is traced out the department will be able to recover the ta ..... X X X X Extracts X X X X X X X X Extracts X X X X
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