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TMI Blog2023 (5) TMI 470X X X X Extracts X X X X X X X X Extracts X X X X ..... d explained and no adverse view be taken. Therefore, CIT(A) has rightly admitted additional evidences of the revised balance sheet submitted by the assessee, and even if it was not admitted by him, it would not have made any material difference to the adjudication of the issue at hand regarding source of cash deposited in the bank account at Jalgoan bank account. CIT(A) has based his decision on certain factual finding being; that the AO himself had verified that cash deposited by the assessee in his bank account at Jalgoan was transferred to the assessee s bank account in Ahmedabad in AXIS bank and accounted for as sales in its books. AO had verified all entries in remand proceedings and had given a finding that it completely tallied and also stated that no adverse view be taken. This factual finding of the CIT(A), we find, is derived from remand report of the AO, contents of which have been reproduced above. DR has been unable to controvert the same before us. In view of the same, we see no reason to interfere in the order of the CIT(A) deleting entire addition of Rs.86.75 crores, noting that the AO himself was satisfied that the cash deposited in the bank account at Jal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erred in law and on facts in deleting addition of Rs.86,75,00,000/- made by the AO on account of unexplained money u/s 69A of the Act. (2) That the CIT(A) has erred in law and on facts by accepting the additional grounds under Rule 46(A) of the I.T. Rules, 1962 since the assessee was given enough opportunities to furnish all evidences during assessment proceedings and the AO had also strongly opposed it in his remand report. (3) That the CIT(A) has erred in law and on facts by accepting the Revised Audit Report of the assessee dated 21-06-2016 furnished before him during the course of appeal proceedings. (4) That in view of the above grounds, the order of the Id. CIT(A) is perverse in law. 3. At the outset, it was pointed out that the solitary issue in the present appeal related to addition of cash deposited in the bank account of the assessee amounting to Rs.86.75 crores remaining unexplained, which was deleted entirely by the ld.CIT(A). 4. The facts leading to the addition being that the assessee was engaged in the business of trading in gold and silver on wholesale basis and during assessment proceedings it was found that there were cash deposits in its c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iled explaining each and every entry. Further, the invoices raised subsequently on receipt of these amounts from Jalgoan were also produced before the AO; the stock records were also produced and purchases sales quantity were tallied to the AO. The assessee admitted that due to oversight the bank account at Jalgoan bank was missed to be accounted for in its books of accounts, and at the same time stated that since all the cash deposits therein had been transferred to the AXIS bank account, the non consideration of the Bank account at Jalgaon did not have much impact on the financial statement of the assessee. The AO however did not accept this contention of the assessee, stating that none of the invoices showed sale of bullion to the customers of Jalgaon nor was there any delivery challan showing receipts by customers outside the Gujarat and in fact all the invoices produced showed the names of the customers from Gujarat only. He accordingly held that the assessee has failed to establish that the cash deposits in its books of accounts at Jalgaon related to the business transaction carried out from the Ahmedabad Office and he treated the entire cash deposits as unexplained money in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d.CIT(A) finding merit in the contention of the assessee, deleted the entire addition made. 7. Aggrieved by the same, the Department has come in appeal before us, challenging both the admission of additional evidences by the ld.CIT(A),and also deletion of entire addition of Rs.86.75 crores on account of cash deposited in the bank account of the assessee found to be unexplained by the AO. 8. We have heard both the parties. We have also gone through the order of the AO and the ld.CIT(A). 9. Before dealing on merits the grievance of the Revenue relating to the cash deposits in the bank account of the assessee in Jalgaon of Rs.86.75 Crs being treated as explained by the Ld.CIT(A), we shall first deal with the grounds raised by the department objecting to the admission by the Ld.CIT(A) of the additional evidences filed by the assessee, which are raised in ground nos.2 and 3 above. Admittedly, the only additional evidence filed by the assessee is revised balance sheet and profit loss account incorporating the assessee s bank account in Jalgoan wherein the cash of Rs.86.75 crores was found deposited and which was not included in the financial statements furnished to the AO. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Since the cash deposited has been explained, no adverse view may be taken. Since all transactions of the Jalgaon account were reflected so in the Axis Bank account of the assessee, it was the assesses contention that therefore the assessee inadvertently missed out on accounting for the Jalgaon Bank account transactions in its Books and therefore filed revised Financial statements to the Ld.CIT(A) incorporating the transactions in the Jalgaon Bank account . 12. We agree with the Ld.CIT(A) that the assessee had adduced reasonable cause for not filing the revised financial statements during assessment proceedings . And accordingly, we hold, that the Ld.CIT(A) had rightly admitted the said additional evidence for adjudication. 13. Even otherwise, since admittedly all the transactions in the Jalgoan bank accounts were reflected in the AXIS bank account of the assessee which was accounted for in the books of the assessee, non-inclusion of Jalgoan bank account in its financial statements did not have any material consequence as such. Therefore, even if additional evidence in the form of revised balance sheet incorporating the Jalgoan Bank account were not admitted for adjudicat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the AO in the Remand Report and the same cannot be upheld. Therefore, the addition suggested and proposed by the AO cannot be made in this case and the same is deleted. This ground of appeal is allowed. 15. As is evident from the above, the ld.CIT(A) has based his decision on certain factual finding being; that the AO himself had verified that cash deposited by the assessee in his bank account at Jalgoan was transferred to the assessee s bank account in Ahmedabad in AXIS bank and accounted for as sales in its books. The AO had verified all entries in remand proceedings and had given a finding that it completely tallied and also stated that no adverse view be taken. This factual finding of the ld.CIT(A), we find, is derived from remand report of the AO, contents of which have been reproduced above. The ld.DR has been unable to controvert the same before us. In view of the same, we see no reason to interfere in the order of the ld.CIT(A) deleting entire addition of Rs.86.75 crores, noting that the AO himself was satisfied that the cash deposited in the bank account at Jalgoan was reflected as sales in the books of the assessee. 16. Even otherwise we find that the AO in his re ..... X X X X Extracts X X X X X X X X Extracts X X X X
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