9911796707
TMI Blog2022 (5) TMI 1131X X X X Extracts X X X X X X X X Extracts X X X X ..... udited financial statements of both the sole proprietorship concerns and after being satisfied that since the assessee sells the goods to retailers in the small villages, towns and markets of Sambalpur, Jharsuguda, Rourkela, Cuttack etc., the source of cash deposit is from sale of goods and in some cases from withdrawal of cash from one bank account and deposit into another. PCIT erred in assuming jurisdiction u/s 263 of the Act and since proper enquiry have been conducted for the issue raised in the show cause notice and a permissible view has been taken by the ld. AO, the entire proceedings u/s 263 of the Act are bad in law. We, therefore, quash the impugned order passed by ld. PCIT and restore the order of the ld. AO passed u/s 143(3) of the Act dated 22.11.2016. Hence, all the grounds raised by the assessee are allowed. - I.T.A. No. 1135/Kol/2019 - - - Dated:- 17-5-2022 - Sri Manish Borad , Accountant Member And Sri Sonjoy Sarma , Judicial Member None appeared on behalf of the Assessee Sh. Sudipta Guha, CIT (D/R), appeared on behalf of the Revenue ORDER Per Manish Borad , Accountant Member: This appeal filed by the assessee pertaining to the Assessm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ip concerns under the name of Shree Maheswari Trading Co. and Radiant Agencies. Assessment was completed at the returned income. 5. Subsequently, ld. PCIT on examining the assessment records observed that the issue of source of cash deposit in bank remained to be examined by the ld. Assessing Officer (in short ld. AO ). The following show cause notice was issued to the assessee: From the assessment order as well as records information available an record for the A.Y. 2014-15, it has been noticed that the following aspects of the return of income/computation of income were not properly looked into by the A.O. concerned:- On perusal of the records, it was observed that the type of the scrutiny was 'Limited and the reason was 'Cash deposit in the savings bank account(s) is more than the turnover. From the records, it was seen that the assesses has two proprietorship concerns viz. Shree Maheswari Trading Company and 'Radiant Agencies' and the total turnovers shown by the assessee were Rs. 62,11,178/- Rs. 46,88,924/-respectively as can be seen from audited Trading and P L accounts. On perusal of ITS-details, it was seen that there was total cash depos ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the frequent withdrawal of cash from one account and deposits of the same in the other accounts. Further; why any businessman would keep on withdrawing cash from his bank accounts simply for the sake of depositing the same on later dates. (b) It was seen that cash of Rs. 26,34,000/- was withdrawn from different bank accounts and deposited in the above mentioned two IDBI bank accounts. was observed here also that there was frequent withdrawal of cash from different batik accounts which was subsequently deposited in the IDBI bank accounts. However, from the records, it was not clear as to what was the source of cash in such bank accounts from which the withdrawal was made? (c) The source of cash deposit of Rs.8,85,000/- was stated to be of the Proprietor (Mr. PR Chandak). But the audited balance sheet as on 31.03.2014 submitted by the assessee, did not justify the source of such cash deposits since there was cash withdrawal of Rs. 4,00,000/- only (Radiant Agencies) during the year under consideration. Hence, the sources of cash deposit of Rs. 8,85,000/- remained unexplained. Further, there was capital introduction of Rs. 5,50,000/- (Shree Maheswari Trading Company) whose so ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y proceedings, the assessee gave following details of the cash deposit and the source thereof: - a) Frequent withdrawal of cash from different Bank Accounts: - As explained, collections from debtors were received through various salesmen who deposit the same into the different Bank Accounts for the convenience of accounting. Afterwards, these sums were withdrawn on lump sum basis as per requirement and deposited into other account, i.e., IDBI Account. From IDBI Account, these were transferred to the main account of the firm, IDBI 0815, from where payments to the vendors were made. As per the bank rule and practice, bank was imposing charges for depositing the cash into the current account beyond the limits allowed. So, more accounts, were opened to deposit cash into these accounts and money was transferred to the other account from where payments to vendor to be made. Due to the scarcity of money, I had to withdraw the funds available by way of collection from various debtors made by my Salesman, debtors and deposit the same into my IDBI Account. Moreover, the banks also favourably consider such transaction while processing application for credit facility. Rs.1,27,00 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Rs.70,000 on 31-3-14 It can be verified from statement attached. The withdrawal from Radiant Agencies was utilized for introduction into Shree Maheshwari Trading Company. d) Source of cash deposit of Rs. 49,23,560 2,23,000: - As already explained that sales vary from Rs. 100 and above and most of the payment were received in cash and deposited into Bunk. Out of the above sum, payment of Rs. 1,41,160/was received directly from debtors by Account Payee Cheque, Bank Draft, RTGS, etc. and balance was from debtors of Shree Maheshwari Trading Company mostly. The sales of Shree Maheshwari Trading Company were as under: - Sales: 54, 18,477,85/- Output VAT: 7,92,699.98/- Total 62,11,177.83/- Which was much more than the collection of Rs. 2,23,000/- + 49,23,560/-and it was also well justified. e) Interest: - Rs. 997/- also does not represent any cash deposit but interest on SB account of Rs. 652/- + Rs 325/- Please also note that due to the nature of scrutiny being limited, the Learned Assessing Officer did not accept the other details and explanation of transactions into other bank accounts from where the transaction into these two account ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
