9911796707
TMI Blog2019 (5) TMI 415X X X X Extracts X X X X X X X X Extracts X X X X ..... its of Rs. 27,06,800/- in Axis Bank A/c No.069010100362054 and this account was not disclosed to the department. The assessee explained that the credits in the bank account represent the trade transactions and the amounts were deposited by customers from various locations of the state, hence requested not to make the addition. However, the assessee could not produce any evidence to support the explanation of the assessee to prove the credits in the bank account were in fact related to business transactions. The break-up of the creditors of Rs. 27,06,800/- is as follows : Cash Deposits - 14,81,640/- Other Deposits - 2,17,160/- ATM Reversals - 8,000/- Unsecured Loan - 10,00,000/- Total - Rs. 27,06,800/- Unsecured loan of Rs. 10,00,000/- was considered by the AO for separate addition and the remaining cash credit of Rs. 16,98,150/- (14,81,640 + 2,17,160) was treated as unexplained and accordingly made the addition to the returned income. 4. Aggrieved by the order of the AO, the assessee went on appeal before the CIT(A) and the Ld.CIT(A) found that the source of the cash deposits was not explained by the assessee and the deposits stated to be made by various ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ceedings, the AO found that the assessee has received the sum of Rs. 10 lakhs from Smt.A.Sharada by cheque No.58534. The assessee was asked to explain the source for Rs. 10 lakhs the and the assessee explained that he had already submitted the complete details before the AO at the time of original assessment, therefore requested to accept the transaction. Since the assessee did not explain the creditworthiness and identity of the creditor in the reassessment proceedings, the AO issued letter to the creditor, Smt.A.Sharada which was returned unserved with a reason 'unclaimed'. Though this fact was brought to the notice of the assessee, the assessee did not furnish the required details before the AO. Therefore, the AO made the addition of Rs. 10 lakhs u/s 68 of the Act. 8. Aggrieved by the order of the AO, the assessee went on appeal before the CIT(A) and submitted that the loan was accepted by cheque and furnished the complete details before the AO at the time of original assessment. The assessee also furnished the copy of Aadhar card to provide the identity of the creditor with a petition for admission of additional evidence under Rule 46A of Income Tax Rules. The Ld.CIT(A) verif ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to the assessee, the Ld.CIT(A) has rightly observed that the assessee has satisfied the identity, credit worthiness and genuineness of the transaction and accordingly deleted the addition. Therefore, we do not see any reason to interfere with the order of the Ld.CIT(A) and the same is upheld. The appeal of the revenue on this ground is dismissed. 11. Ground No.4 is related to the addition of Rs. 42,24,817/-. During the assessment proceedings, the AO found that there were credits in the bank account of ING Vysya bank account No.705010053543 to the tune of Rs. 42,50,176/- for which the assessee explained that the deposits were business transaction and the customers from various locations have made the deposits towards sales. However, the assessee failed to furnish the evidence to support the credits or the sales. Therefore, the AO treated the deposits made in the bank account totaling to Rs. 42,24,817/- as income of the assessee. 12. Aggrieved by the order of the AO, the assessee went on appeal before the CIT(A) and the Ld.CIT(A) observed that most of the credits in the account represent the assessee's business transactions on the basis of additional evidences produced by the asse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the ING Vysya bank and other bank accounts relate to business transactions or not. Though the Ld.CIT(A) entertained the additional evidence, the same was not referred to the AO as required under Rule 46A of Income Tax Rules. Therefore, the Ld.CIT(A) has not given opportunity to the AO to verify the additional evidence and to submit the comments on the additional ground. Therefore, we are of the considered opinion that the issue should be remitted back to the file of the Ld.CIT(A) to call for the remand report from the AO and decide the issue afresh on merits of the case. Accordingly, we remit the issue back to the file of the Ld.CIT(A) with direction to decide the issue afresh on merits. The Ld.CIT(A) / AO should reconcile the credits in the bank account and the turnover declared by the assessee before deciding the issue. The Ld.CIT(A) also to be given sufficient opportunity to the assessee before passing the orders. The appeal of the revenue on this ground is allowed for statistical purpose. 15. Ground No.5 is related to the addition of Rs. 21,67,758/- in IndusInd Bank. During the assessment proceedings, the AO found that there was cash deposit of Rs. 23,89,857/- in the Indus In ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... deposits made in the bank account and the sales admitted by the assessee. It is a fact that the assessee is engaged in the business and made sales to various parts of the state. It is also a fact that the sales are deposited in various locations. In the circumstances making addition of deposit in the bank account without verification would cause injustice to the assessee. In this case, it is to be seen whether deposits relates to sales or not. If the deposits are related to sales, only gross profit required to be brought to tax, but not the entire deposits. In case, the deposits do not represent sales, the addition should be restricted to peak credits if the same money is in circulation. All these aspects were not examined by the AO / CIT(A). Hence, we are of the considered opinion that the issue requires detailed examination. Hence, we remit the matter back to the file of the Ld.CIT(A) and direct the Ld.CIT(A) to reexamine the entire issue after calling the remand report from the AO and decide the issue afresh on merits. Accordingly, the appeal of the revenue is allowed for statistical purpose. 18. In the result, the appeal of the revenue is partly allowed for statistical purpose ..... X X X X Extracts X X X X X X X X Extracts X X X X
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