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TMI Blog2018 (12) TMI 179X X X X Extracts X X X X X X X X Extracts X X X X ..... s no occasion to doubt the part of deposit from the accepted sales in the saving bank account of the assessee. We, therefore, considering the totality of the facts, are of the view that the CIT(A) was justified in deleting the impugned addition made by the AO. - decided against revenue. - ITA No. 4080/Del/2015 - - - Dated:- 14-8-2018 - Sh. N. K. Saini, AM and Sh. Laliet Kumar, JM For the Assessee : Sh. Sanjay Kumar, CA For the Revenue : Smt. Ashima Neb, Sr. DR ORDER PER N. K. SAINI, AM: This is an appeal by the department against the order dated 25.03.2015 of the ld. CIT(A)-18, New Delhi. 2. Following grounds have been raised in this appeal: 1. Whether the CIT(A) has acted in gross violation of provision u/s 250 of the I.T. Act read with Rule 46A(1) (2) by admitting additional evidence contrary to provisions thereto. 2. The CIT(A) has ignoring the fact Submitted during the course of assessment proceedings that assessee engaged in the business of trading of Fabrics in name N.K. Handa Textile Co reselling of Garments in name of N.K. Handa Sons but as per Colum no. 8(a) of Audit Report in Form 3CD dated 26.09.2011 the auditor has stated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sales so made have been deposited in overdraft a/c, C/A a/c S/B with the Karur Vysya Bank Ltd., Kailash Bank Branch, New Delhi. 9. The appellant craves leave to add, alter or amend any/all of the grounds of appeal before or during the course of hearing of the appeal. 3. From the above grounds, it is gathered that the main grievance of the assessee in this appeal relates to the deletion of addition of ₹ 81,50,175/- by the ld. CIT(A) made by the AO on account of cash deposits by admitting the additional evidences. 4. Facts of the case in brief are that the assessee filed his return of income on 30.09.2011 declaring total income of ₹ 2,42,397/- which was processed u/s 143(1) of the Income Tax Act, 1961 (hereinafter referred to as the Act) on 24.12.2011. Later on, the case was selected for scrutiny. During the course of assessment proceedings, the AO observed that as per the AIR information, during the year under consideration the assessee had deposited cash of ₹ 81,50,175/- in his saving bank account maintained with Karur Vysya Bank Ltd. He, therefore, asked the assessee to explain the source of cash deposited in his bank account and also sudden shoo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is dealing in export surplus fabric, wherein most of the time, purchase and sales are not in same unit of measurement. The assessee have purchased the export surplus fabric lot in Mts. and after sorting out the lots the same have sold the same to petty vendors in Mtr. as well as in Kg. In such circumstances maintaining Stock Register quantity wise not possible. A reference was also made to the remarks of the Auditor in Tax Audit Report wherein it was mentioned as under: Furnishing quantitative details are not possible as the assessee do not maintain stock register. 4.3 The AO asked the assessee to produce cash book, copies of cash memo. In response, the assessee submitted that most of the goods were sold to petty vendors in cash which was deposited on various occasions in the Bank. 4.4 The AO was not satisfied from the submission of the assessee and observed that the assessee did not utter a single word on maintenance of cash register and had not maintained any details that how much cash was received during the period. He, therefore, considered the deposits in bank account as an unexplained cash credit u/s 68 of the Act and made the addition of ₹ 8 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... possible to make a mention variety wise, in the cash memos and moreover, after accepting the sales as disclosed by the assessee, this issue too had become irrelevant, rather non-existent. Accordingly, it was submitted that the addition made by invoking the deeming provisions of Section 68 of the Act was not sustainable. 5.1 The ld. CIT(A) after considering the submissions of the assessee observed that the audited balance sheet of the assessee revealed that the said saving bank account stood reflected in the balance sheet and accordingly the entries in the saving bank account were appearing in the books of the assessee. He further observed that in the trading account of M/s N. K. Handa Textiles Co., the sales of the assessee during the year were at ₹ 3,44,48,803/-, out of which majority of sales i.e. ₹ 3,35,77,346/- was in cash and balance sale of ₹ 8,71,457/- was to other customers and as against the cash sales, the assessee deposited a sum of ₹ 3,11,70,175/- (Rs.2,00,70,000 in Overdraft account in the name of N. K. Handa textiles Co., ₹ 29,50,000/- in current account in the name of N. K. Handa Sons and ₹ 81,50,175/- was in saving bank a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... K. Handa Sons which is evident from page no. 2 of the assessee s compilation which is the copy of computation of income. Even in the copy of acknowledgment, the aforesaid fact has been mentioned. The assessee was maintaining current account and overdraft account in Karur Vysya Bank Ltd. and deposited the sale proceeds in those bank account. The assessee also deposited cash out of the sales in his individual saving bank account which was later on transferred to current account and OD account. The AO accepted the sales made by the assessee and also accepted the deposits in current account as well as over draft (OD) account from the cash sales, he only doubted the deposits in the saving bank account of the assessee. Copy of saving bank account is placed at page nos. 138 to 142 of the assessee s paper book, the AO doubted the cash deposits in the said saving bank account but has not doubted the transfer from the said saving bank account to other accounts through cheque. In our opinion, when the AO has not doubted the quantum of cash sales and accepted the deposits, out of those sales in current account and overdraft account maintained with Karur Vysya Bank Ltd. then there was no occ ..... X X X X Extracts X X X X X X X X Extracts X X X X
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