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TMI Blog2022 (8) TMI 759X X X X Extracts X X X X X X X X Extracts X X X X ..... The peak credit has to be worked out properly by considering only cash receipts and cash withdrawals and the same is required to be verified by Ld. AO. The same is the plea of Ld. Sr. DR who has submitted that peak credit was not made available to Ld. AO and therefore, modification in directions is required. We find that the assessee has made deposited cash and withdrawn the same throughout the year. Accepting the plea of Ld. Sr. DR, the working of the peak credit shall be furnished by the assessee to Ld. AO who is directed to consider the same and restrict the addition to the extent of peak credit of cash receipts and cash withdrawals. The cheque entries shall be separately examined and readjudicated. The directions given in the impugned ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rned CIT(Appeals) may be set aside and that of the Assessing Officer be restored. As evident, the Revenue is aggrieved by relief granted by Ld. CIT(A) with respect to unexplained cash credit in the impugned order. The Ld. CIT(A) has partly allowed the appeal of the assessee, which has been accepted by the assessee. 2. The Ld. Sr. DR assailed the finding of the Ld. CIT(A) which has been controverted by Ld. AR. Having heard rival submissions and after perusal of case records, our adjudication would be as under. Assessment Proceedings 3.1 The assessee being resident individual is stated to be belonging to a group of persons who mainly engaged in business of money lending on cash basis. It transpired that the assessee deposit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ash deposits with persons names attached to it. 3.2 The assessee submitted that the cash deposits are repayments received from various persons to whom the assessee had lent money. It was also submitted that the amounts were already accounted for as they represent the amounts that are only getting recycled. The monies were received back from borrowers and the same was used to further lending to other persons. However, the assessee did not maintain any books and did not maintain any list of borrowers. 3.3 Considering the same, Ld. AO held that cash deposits remain unexplained u/s. 69A of the Act. The assessee submitted peak credit balance in the bank accounts wherein it netted off cash deposits with withdrawals made in the mode otherwis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ame account, whether by cash or by cheques shall lead to absurd conclusions. The assessee was liable to explain only the peak balance in the bank accounts for which the assessee relied on various decisions. 5. The Ld. CIT(A) noted that the A.O has sought to assess the gross deposits while the assessee s plea was that only the peak credit was liable to be added as money advanced in money lending business would be circulated frequently meaning thereby that the amount advanced is received back and is again advanced in relatively shorter duration of cycle in the said business. Therefore, the peak credit theory would apply to the assessee. On identical situation, in the case of assessee s group concern e.g. Anbukannan vide order ITA No.238/16 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is untenable. The peak credit as mentioned in para 7.5 is explained by the peak cash balance available. I hold that no further addition is exigible and hence, the AO is directed to delete the addition after verifying the arithmetic correctness of the working and affording opportunity to the appellant. Accordingly, the appellant s ground on this score is disposed of accordingly. Aggrieved aforesaid the revenue is in further appeal before us. Our findings and Adjudication 7. Upon careful consideration of factual matrix, we find that this similar issue has already been decided by Tribunal in assessee s group case i.e. Shri A. Anbukannan (ITA N0.1871/Mds/2014 and 1731/Mds.2014 dated 05.04.2017). The bench upheld the application ..... X X X X Extracts X X X X X X X X Extracts X X X X
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