9911796707
TMI Blog2022 (12) TMI 218X X X X Extracts X X X X X X X X Extracts X X X X ..... ssment year 2011-12 on 13.06.2011 admitting a total income of Rs. 1,71,541/-. The case of the assessee was selected for scrutiny and after following due procedure, the Assessing Officer has completed the assessment under section 143(3) of the Income Tax Act, 1961 ["Act" in short] dated 27.03.2014 assessing total income of the assessee at Rs. 2,19,20,740/- by making addition of cash deposits of Rs..2,17,49,200/- as income from undisclosed sources. On appeal, the ld. CIT(A) has granted partial relief to the extent of Rs. 1,26,14,536/- and the balance amount of Rs. 91,34,664/- has been sustained on estimate basis. 3. On being aggrieved, the assessee is in appeal before the Tribunal. The ld. Counsel for the assessee has submitted that the deta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ill date no report is received from the Assessing Officer. The AR of the appellant has submitted details which sing only in one tune and require that tax authorities adopt only limited view that someone gives cheques and someone encashes them without looking at the surrounding circumstances. As neither AO has responded despite reminders and neither the ARs have anything new to say, the case is now disposed off on merits. 5. The AR of the assessee has filed a letter dated 29.02.2016, in which he has tried to make out a case for cash deposits in the account of the assessee. The argument of the AR is that, that cheques have been issued to various parties so that the same are discounted by them from the bank and the cash flow is generated, w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... counted is transferred by the other person to the assessee's account and the assessee withdraws money from that account to deposit in the Axis Bank to pass the cheques issued by him. to various parties. Hence, it is clear that the parties have transferred the discounted amount to assessee's account which the assessee has withdrawn and deposited in his account with Axis Bank. Hence it is not true that the parties have withdrawn cash and given it to the assessee. This is clear from the explanation of transactions which we have annexed herewith for your perusal. This trail of transactions is given for about 10 transactions and we have enclosed the assessee's bank account copies along with the bank account statement copies of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . 1,50,000/-. Reference is made to the case of Sumati Dayal Vs CIT [214 ITR 80B SC (1995)] which brings about the test of human probability and that evidence has to be seen in the light of expected behavior of a normal person. As has been shown earlier, effective interest rate comes to about 52% p.a. The parties who have claimed to have taken accommodation from the appellant have neither furnished returns of income nor justified as to the uses to which such huge cash withdrawals have been made. The question arises as to whether all this is merely a game of lending money at high interest rates or is it some crude measure of money laundering. Even considering the fact that money has frequently been returned to be deposited again and again in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mmercial sense in this whole business. 9. In this light of circumstantial evidence and material on record, 80% of effective interest rate i.e. 42% (52 x 0.8) of gross cash deposited is considered as income of the appellant. Balance 20% of estimated interest has been given as relief to the appellant and would include therein any claims on account of peak credit. As a result, out of the cash deposit of Rs. 2,17,49,200/-, 42% being Rs.91,34,664/- is sustained as income in the hands of the appellant and the appellant gets a relief of Rs. 1,26,14,536/-. 6. We have gone through the observations and findings of the first appellate authority, wherein, the ld. CIT(A) estimated and adopted 80% of effective interest rate i.e., 42% (52 x 0.8) of g ..... X X X X Extracts X X X X X X X X Extracts X X X X
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