9911796707
TMI Blog2023 (12) TMI 867X X X X Extracts X X X X X X X X Extracts X X X X ..... ceipts received from the customers are reflected in the Audited Profit Loss account as income/ receipts and again if the cash deposits are added under section 68 of the Act, it will amount to double taxation once as sales and again as unexplained cash credit which is against the principles of taxation. AO has not pointed out any specific adversity but made a generalize additions covering the demonization period, cash deposits and RTGS credits without considering the factual aspects and primary evidences. A.O has failed to make further enquiries on the information filed and the assessee has discharged the initial burden placed by submitting the information and details. AO has not disputed on the quantity of stocks maintained in the register, and stock valuation in the Audited financial statements and also the turnover reflected by way of cash sales and bank credits. The assessing officer has accepted the sales and corresponding nexus with the purchases and closing stock of goods. We find the CIT(A) has dealt on the facts, provisions of law, submissions and judicial decisions and has passed a conclusive and reasoned order. Accordingly, we do not find any infirmity in the orde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... M/s. Dyaneshwari Multi-State Co-Op. Credit Society Limited and without considering the statement of Shri Nilesh Kamble wherein it is stated that as per the instructions of Mr. Akhilesh Joshi, the overall head of Mumbai Branch of the society, the total cash of Rs. 2 crores was deposited into the bank account of the society and thereafter an equivalent amount was transferred through RTGS to the assessee in four tranches 2. The Ld. CIT(A) erred in restricting the addition of Rs. 79,00,000/- to Rs. 1,06,650/- considering only Rs. 53,94,245/- difference in Net Profit on entire sale vis- -vis Net Profit on this sale without appreciating the fact that the assessee has not submitted documentary evidence of actual delivery and sale of the Gold. 3. The Ld. CIT(A) erred in deleting the addition of Rs. 5,00,000/- being unexplained expenditure without appreciating the fact that Shri Ashit Doshi in his statement u/s. 132(A) of the Act has stated that the assessee had given Rs. 84,00,000/- to Shri Ashit Doshi and had brought back Rs. 79,00,000/- as bogus sale bills in its books, further, commission of Rs. 5,00,000/- paid to Shri Ashit Doshi for arranging the transaction is an un ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Rs. 2 Crores as unexplained cash credit. 5. The second disputed issue is with respect to sale of bullion to four entities, (i) Aman Trading of Rs. 17,99,550; (ii) Aman Trading Enterprises of Rs. 17,99,500/-; (iii) Marina Trading of Rs. 21,50,500/-; Pradip Trading of Rs. 21,50,000/- all aggregating to Rs. 79,00,000/-. The AO has dealt on the statement of Mr. Ashit Doshi, and on the sale bills of the assessee provided to the aforesaid entities. Whereas the AO has not accepted the contentions of the assessee that, the transactions of sale of bullion to the parties are genuine and supported with the documentary evidences i.e photocopies of sales invoices and bank statements evidencing receipt of sale consideration vide letter dated 21.11.2019. Further contentions of the assessee are that there is a violation of the principles of natural justice as the statement of Mr. Ashit Doshi was recorded behind the back of the assessee and the AO ought to have provided a copy of statement to confront the parties, but the A.O has relied on the statement recorded and made an addition of Rs. 79 lakhs. 6. On the third disputed issue, The AO alleged that the assessee must have paid commission fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d the grounds of appeal, statement of facts, submissions of the assessee, findings of the AO and dealt extensively on the facts and provisions of the Act and judicial decisions and directed the Assessing officer to delete the additions and partly allowed the assessee appeal. Aggrieved by the CIT(A)order, the revenue has filed an appeal before the Hon ble Tribunal. 10. At the time of hearing, the Ld. DR submitted that the CIT(A) has erred in directing the AO to delete the addition to the extent of Rs. 1.97 crores though the assessee has not proved actual sale of gold. The Ld. DR also emphasized that the CIT(A) has erred in allowing the relief to the extent of Rs. 77.93 lakhs as against of Rs. 79 lakhs being added by the A.O. though the assessee has not submitted any documentary evidence of actual delivery of gold and on the third disputed issue, the CIT(A) has erred in deleting the addition of Rs, 5 Lakhs made by the AO on account of unexplained expenditure on accommodating entries obtained from third parties. Further the CIT(A) has erred in deleting the deposits of Rs. 5.53 crores in the bank accounts by the assessee during the demonization period overlooking the observations of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2017; 3.2.2. Mr Ajit Jain did not remember the person who delivered the bullion to the Society; 3.2.3. Mr Ajit Jain did not remember the name of the person receiving the bullion 3.2.4. P.A. No of the Society does not bear a photograph; 3.2.5. The office of the Society though located in Zaveri Bazar, which is the hub of gold and bullion trade, purchased such bullion from the appellant-company in Vile Parle; 3.2.6. The appellant-company has taken signature of an unknown person on the bill of the Society without any name or identification. 3.2.7. The appellant-company has delivered the gold bars to an unknown person at the office of the Society and the appellant company does not have any documentary evidence of actual delivery of the gold bars to the Society 32.8. Statement of Mr Nilesh Kamble Mr Nilesh Kamble in his statement on oath dated 07.04.2017 stated that he does not remember whether the Society has purchased bullion from the appellant-company; 3.2.9. In the statement on oath, Mr Nilesh Kamble stated that as per the instructions of Mr Akhilesh Joshi, the overall head of Mumbai Branch of the society, the total cash of Rs 2 crores was deposite ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it Jain, after some efforts, recollected the name of the delivery boy Mr Shankar Kumavat, who would have made the delivery to the Society. However, he may not be very, sure due to the passage of time of nearly 5 months from the date of transaction. It would not be out of place to mention that confirmation of delivery in today's day and age is simpler and fool proof telephonically with the help of smart phones. (c) PAN card of a non-individual person does not bear a photograph The Assessing Officer ought to have thus, known the fact that PAN card of the Society would not bear a photograph and that a PAN card is issued by the Income-tax Department; (d) The parties to a transaction are entitled to arrange their affairs in such a manner that are most convenient to them and the Assessing Officer cannot sit in the armchair of a businessman and decide the manner in which the business should be f conducted 3.5 The appellants submit that the Assessing Officer in making the impugned addition relied on the statement on oath of Mr Nilesh Kamble, branch manager of the Society, recorded under section 131 of the Act - in this, we submit that - 3.5.1 There is gross violatio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r Nilesh Kamble and Mr Ashit Doshi, the Assessing Officer has conveniently accepted the version of Mr Nilesh Kamble ignoring the evidentiary value of the statement on oath of Mr Ajit Jain, which in law is not correct. 3.5.5. The statement is not recorded in the presence of the appellants, and hence, the same cannot be treated as conclusive evidence unless confronted to the appellants, for rebuttal. The Assessing Officer has not allowed cross examination by the appellants of Mr Nilesh Kamble. It could well be that due to prevailing adverse situation, Mr Nilesh Kamble was compelled to accept something which is not the fact or he must have stated something to put himself out of harm's way of any future legal proceedings or he would have stated as instructed. In view of the above, the appellants contend that the impugned addition is baseless and ought to be deleted. 13. Whereas the CIT(A) has dealt on the facts and the information and has deleted the addition as the assessee has filed the material evidences in support of claims in the proceedings and observed at Para 8.2 to 8.9 of the order as under: Decision on Ground No. 2 8.2 Briefly the facts related to t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erence that could be drawn was that physical sale of gold during the year sale recorded in the books of accounts were not in divergence. 8.3.3 According to the appellant, since the statements of other parties were not recorded in the presence of the appellant, that cannot be treated as conclusive evidence unless confronted. The statement of Mr. Nilesh Kamble was neither confronted with any responsible person of the appellant co. nor was cross examined in appellant's presence. It is further contended that there are T. of possibilities that there were adverse situation or Mr. Nilesh Kamble had compelling situation to accept something which was not the fact or to put themself out of the part of any legal proceeding in future or they would have stated as instructed. According to the appellant, it was as per natural law justice that the AO would have offered the assessee an opportunity of cross examination the statement was duly confronted. It is further stated that Mr. Ajit Jain, Director of the appellant company had asked before the AO for cross examination opportunity before framing any opinion against Mr. Ajit Jain M/s Mangal Royal Jewels Pvt Ltd. 8.3.4 The app ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... could not be identified by Shri Ajit Jain. In the light of above facts and circumstances related to the issue involved, the AO, in para 6.3.5 of the assessment order has concluded that the appellant has only received RTGS amounting to Rs. 2 crore and no gold bar was actually sold/delivered against the said receipt. 8.6 Against these observations, the appellant has argued before the undersigned that- 8.6.1 During the Search Seizure action carried out at appellant's premises on 08.04.2017 by Investigation Wing, Mumbai, the search team had physically verified the entire stock. The stock available at the time of search was also valued by an independent Government appointed Registered Valuer. No discrepancy was found between the physical stock and the stock in the books of accounts. In the assessment order, I do not find any remark made by the AO with respect to any divergence between physical sale of gold during the impugned year sales as recorded in the books of accounts 8.6.2 According to the appellant, the A.O. has not doubted the genuineness of the purchases made by the appellant. It is also contended that when the stock register has been accepted by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... all the parties with whom high value transactions have been executed - specially the case in hand, after nearly 5 months from the date of transaction (17.11.2016). Though the said transaction is one of the high value transactions, it can be that the name of the person be not remembered who has just visited once for a one off transaction. Further, the appellant is engaged in retail trade and hence, came in contact with so many persons that it may be difficult to remember the name of each and every person with whom transactions have taken place. 8.6.6.2 Moreover, it is difficult for any person to remember precisely things not so important, viz., name of delivery boy who has delivered goods to one-off customer, that too, under the daunting pressure of an on-going search action. Mr Ajit Jain, after some efforts, recollected the name of the delivery boy: Mr Shankar Kumavat, who would have made the delivery to the Society. However, he may not be very sure due to the passage of time of nearly 5 months from the date of transaction. 8.6.6.3 photograph. PAN card of a non-individual person viz., the Society does not bear a 8.6.6.4 The parties to a transaction are entitled to a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se of gold bullion as recorded in the books of accounts nor any excess stock was found by the Search team. No adverse comment has been made by the AO with respect to the end result of the said RTGS amount of Rs. 2 Crores. There is nothing on record which suggest that the RTGS of Rs. 2 crores was returned back by the appellant company to the Society or used for a purpose other than its business purpose. Logically, the Society will not leave such a huge amount in the bank account of the appellant company had the amount not utilised for purchase of gold or bullion. 8.9 If the statement of Mr Nilesh Kamble is taken on it's face value, where he has stated that no gold or bullion was purchased by the Society against the said cash, the next logical inference is either the cash was returned back to the Society or equivalent amount of gold or bullion was sold in the name of some other entity. There is nothing on record, which suggest that cash was thereafter returned back to the Society. This situation will not arise normally since the AO has neither doubted the corresponding purchases of the gold bullion as recorded in the books of accounts nor any excess stock was found by th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 17,99,500 3 Marina Trading 21,50,000 4 Pradip Trading 21,50,500 4.2. The Assessing Officer made the impugned addition for the reasons that 4.2.1. In the statement on oath of Mr Ashit Doshi of 01.12.2016, he has stated that the sale bill of the appellants to the aforesaid entities is bogus, and against which no delivery of goods is received. He further, stated that he was contacted by a broker Mr Mahesh Mangal to deposit in the bank accounts of his aforesaid proprietorship/ partnership firms, old currency notes of denomination Rs 500 and Rs 1000 which have ceased to be legal tender effective from 09.11.2016; 4.22. He further stated in his statement that he received Rs 84,00,000 in cash and after deducting his charges of Rs 5,00,000, made RTGS from the aforesaid accounts aggregating Rs. 79,00,000. 4.2.3. Receiver signature on the sale bills are different from each other, though allegedly controlled by the same person Mr Ashit Doshi; 4.3. the appellants contend that the impugned transaction of sale of bullion to the part ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on oath of Mr Ajit Jain recorded on 09.04.2017 refer page nos 107 to 153 of the paper book. 4.4.3 The Assessing Officer without appreciating the said facts states in para 7.6. of the assessment order that A perusal of the Bill Book shows that there are some signatures made as Receivers Signatures 9. It is interesting to note that all the four signatures on the Bill numbers 4174, 4175, 4176 and 7177 are different from each other. None of the signature match with any of the other signature thereby indicating that all the four signatures are of different people. If what Shri Aiit Jain has stated is true all the four signatures should be of Shri Ashit Doshi (emphasis ours). Thus, from the above it can be inferred that the event of purchase of goods and actual delivery are at two different points of time and that the delivery of goods taken at Sion may be by different persons working for different proprietor/ partnership concerns, under the authority of Mr Ashit Doshi. The Assessing Officer thus, misinterpreted the relevant facts and made the impugned addition. 4.4.4. The appellants further contend that there being contrast views expressed by Mr Ajit Jain and Mr Ashit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... orked out to Rs. 1,06,650/-. Even when it is considered that no profit was offered on the impugned transactions of Rs. 79,00,000/- made through RTGS, only Rs. 1,06,650/- deserved to be added to the total income of the appellant on estimate basis. Hence, the addition of Rs. 1,06,650/- is confirmed. The AO is directed to delete the balance addition of Rs. 77,93,350/-. Thus, the ground of appeal no. 3 is partly allowed 16. On the third disputed issue, the Ld. DR submitted that the CIT(A) has erred in deleting the addition of Rs, 5 Lakhs made by the AO on account of unexplained expenditure U/sec 69C of the Act on accommodating entries obtained from third parties. The Ld. DR contentions are that the AO has considered the nature of the accommodation entry and also incurring of expenditure in obtaining the benefit to the assessee. Whereas the CIT(A) relied on the written submissions dealt in the appellate order at Para 10.1 of the order as under: 10.1 During the course of the appellate proceedings the AR of the appellant had submitted under: 5. Re-ground of appeal No.4, addition under section 69C-Rs. 5,00,000/- 5.1. The Assessing Officer has made an addition of Rs. 5, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the order as under: 11.1 During the course of the appellate proceedings, through written submission, the appellant has submitted as under: 7. Re-Ground of appeal no 6-Addition under section 68-Rs. 3,27,77,981 7.1. The Assessing Officer has made an addition of Rs 3,27,77,981 under section 68 of the Act, being the amount received through banking channels against sales made, alleging such sales made as fictitious, details of which are given below. 7.2 at the outset, regarding parties mentioned in Table B in para 7.1. above, appellants contend that - 7.2.1. the Assessing Officer has not given any specific reason or adverse remark to allege the sales made to such parties as fictitious and the amount received from such parties as unaccounted money of the appellants. 7.2.2 during the course of assessment, the appellants filed documentary evidences, being sales invoice, ledger account of such parties and bank statements to prove the genuineness of the transactions - refer letter dated 21.11.2019 of the appellants filed with the Assessing Officer page nos 51 to 106 of the paper book. The Assessing Officer has not disproved the documentary evidences filed by t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... an entity and then decide to sell goods to them when the fact is that the appellants are getting the sale consideration immediately before the delivery of goods. 7.3.5.2. Farm Pvt Ltd RCG Financials India Pvt Ltd and Girish Hotels Resorts and Health have P.A. No. and information regarding such entities is available on the portal of the Incometax Department, hence, proves the identity. The appellants cannot be expected to verify whether such entities are regular in filing their return of income. 7.3.5.3. GFL Financials Ltd- the basis of the Assessing Officer to consider the sales made to GFL as non-genuine, on the grounds that the buyer has weak financials, their Directors have failed to appear before the SEBI adjudicating authority, is fined by the SEBI, are irrelevant considerations. Further, the financials of the said entity referred to by the Assessing Officer are for the period prior to 31 March, 2015 and the year under reference is previous year ended 31 March, 2017, hence, irrelevant. The fact that such company is listed itself proves the identity of the purchaser company and the Assessing Officer cannot expect the appellants to verify the credentials of an entity ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the parties concerned. Other observations remain the same. 11.3 On the issue of poor financials of these 14 entities, the appellant has stated before the AO about certain constraints which are implied to be in place/ practice with any jewellery businessman while doing business transaction, especially when the business transaction is of retail segment in Cash/RTGS mode (i.e. not on credit basis). These are 11.3.1 No verification of source of payment possible 11.3.2 No verification of credibility financial conditions possible 11.3.3 verification of share price performance over the stock exchange possible 11.3.4 No need of KYC of your Customer 11.3.5 No need-to-know address of the customer 11.3.6 No need to check whether the customer is tax compliant or not 11.3.7 No need to know about legal background of customer 11.4 Apart from the above, the appellant, during appellate proceedings has stated about these entities in the following manner. 11.4.1 In the case of transaction with M/s ACIL Cotton Industries Ltd, we had a CASH/RTGS payment mode deal with this company. And in such deals, we as a business man have constraints which ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion in the invoice. The address of M/s R R Steel would have got changed the ITD database may not be updated. The PAN of the R R Steel is AABPD8629D. 11.4.6 In case of transactions with Mr. Sunil Vijay Khanna, we have explained that the statement of his driver servant was recorded at the back of Mr. Ajit Jain. As the statement has not been recorded in the presence of the assessee, which could not be treated as conclusive evidence unless confronted. The driver and servant neither have confronted the same with us nor has he been cross examined in our presence. It could have been adverse situation or he could be compelled to accept something which was not the fact or to put himself out of the part of any legal proceeding in future he would have stated as instructed, may be. It will be as per natural law justice if the Ld. AO offer the assessee an opportunity of cross examination the statement should be confronted. Hence, Mr. Ajit Jain had asked for cross examination opportunity before framing any opinion against Mr. Ajit Jain M/s Mangal Royal Jewels Pvt Ltd. Mere placing angeliance upon the statement of servant driver and without offering any cross examination by the A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... om companies belonging to same group, mentioning different address. Further, the signature on such bills does not match with the signature as per the PAN card. 6.2.3. The appellants should have verified the credentials of the purchaser on the basis of the PAN card; Contentions 6.3. The appellants contend that each cash sale made by the appellants is supported by documentary evidences like sale bill together with photo copy of PAN card of the buyer and as such, the identity of the buyer and the sale is proved. 6.4, Further, the cash received on sale of gold/ bullion is recorded in the books of account and subsequently, such cash is deposited in the bank account, thus, there is no reason to make the impugned addition under section 68 of the Act. 6.5. The appellants contend that the reasons mentioned by the Assessing Officer are misplaced for the following - 6.5.1. It is a known fact that sales increase in festive seasons in India. As per the customs and traditions in India, gold and/ or jewellery is usually bought on auspicious days or during festive season. Diwali is considered as the most auspicious festival and there is a tendency of high demand in go ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d. 12.3 From the assessment order, it is observed that the AO has made the impugned addition on the following premises - 12.3.1 Substantial quantity of gold/ jewellery is sold in cash prior to demonetization, i.e., in October and up to 08.112016; 12.3.2 Most of the people who purchased gold above Rs. 2 Lakh in cash, are don-filers of income tax returns referred 12.3.3 Few persons have bought gold from concerns belonging to same group, mentioning different address. Further, the signatures on such bills do not match with the signatures as per the PAN cards; 12.3.4 The appellants should have verified the credentials of the purchaser on the basis of the PAN card; 12.3.5 There were some delays in depositing the cash, in the bank account. 12.3.6 Multiple bill books have been utilised by the appellant. 12.4 It is observed that elaborate reply has been made by the appellant before the AO (extensively quoted in the assessment order too) as well as before the undersigned on this issue. My observations on the same are - 12.4.1 According to the appellant, during the relevant year, Diwali festival had commenced from 28th October, 2016 to 1st Novembe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gard, the appellant has stated that each cash sale is supported by documentary evidences viz., sale bill together with photo copy of PAN card of the buyer and as such, the identity of the buyer and the sale are established. On the issue of PAN requirement non-filers, it is submitted by the appellant that a careful reading of section 139A read with rule 114B, makes it clear that there is no requirement that the person making transaction of more than Rs. 2 Lakh is liable to file the Income Tax Return u/s 139 as mandatorily. In this regard, I agree with the appellant's argument that the PAN requirement has been made mandatory to identify the person who makes the transactions above Rs. 2 Lakh in cash. And based on that identity, the Department's System can trace and retrieve the Financial Identity other details to keep track on that person's financial transaction related income tax compliances. Once there is no requirement in the Income Tax Act for checking the Tax return filing status of the buyer by the sellers, no adverse inference can be drawn against Comm the appellant on this count. Hence, the AO's observations in this regard, is unfounded. 12.4.3 On th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The Assessing Officer has in the alternative to the additions made under section 68, aggregating Rs 11,67,07,981 (for details, refer para nos 3 to 7 above) invoked the provisions of section 69A of the Act. 9.2. The appellants for ready reference reproduce the provisions of section 69A as under- 69A. Where in any financial year the assessee is found to be the owner of any money, bullion, jewellery or other valuable article and such money, bullion, jewellery or valuable article is not recorded in the books of account, if any, maintained by him for any source of income, and the assessee offers no explanation about the nature and source of acquisition of the money, bullion, jewellery or other valuable article, or the explanation offered by him is not; in the opinion of the Assessing Officer, satisfactory, the money and the value of the bullion, jewellery or other valuable article may be deemed to be the income of the assessee for such financial year. (emphasis ours) 9.3. From a cursory glance of the provisions of section 69A, it is crystal clear that the provisions can be invoked only when the appellants are found to be the owner of any money, bullion, jewellery or va ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on of books of account under section 145(3) 10.1. The Assessing Officer has rejected the books of account of the appellants on the ground that sales shown by the appellants to various parties are fictitious and the amount received on such sale is unaccounted money of the appellants Contentions 10.2. The rejection of books of account is on assumptions and presumption and that each addition made by the Assessing Officer is separately dealt with by the appellants in ground of appeal nos 2 to 6. 10.3. The appellants submit that the Assessing Officer has not brought anything on record to show that there is any doubt about the correctness or completeness of the accounts of the appellants. It is submitted that the Assessing Officer has not pointed out any defect in the books of account and merely on the basis of his presumption of unexplained credit entries proceeded to reject the same which is not permissible under the law. 10.4. In fact, it is evident from the assessment order that the Assessing Officer has accepted the annual accounts prepared by the appellants inasmuch as the starting point of the computation of income prepared by him is the income per computa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... red to the summary of cash available as per the financial statements. Further the Ld. AR submitted that the turnover of the assessee in F.Y. 2016-17 was accepted by the authorities and also substantiated the submissions with the copies of the VAT returns and invoices. Further in response to the show notice issued of the A,O, the assessee has filed the exhaustive details referred at page 51 to 106 of the paper book. The assessee has also substantiated the quantitative stock maintained and the transactions are totally supported with the material details placed in Tax Audit report U/sec 44AB of the Act at page 26 to 35 of the paper book. 25. The Ld.AR emphasized that, the detailed explanations with the evidences filed in lieu of notice issued u/s 142(1) of the Act was filed and the AO has not considered these facts and made unilateral addition overlooking these material evidences.. The Ld. AR submitted that that the assessee has filed the details of purchase of the jewellery by the customers during the demonetization period and also the details of quantity purchases, sales stock in F.Y.2016-17 and also the VAT returns were filed. The assessee has also submitted the details of cas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... zed notes could not have been accepted as valid tender. He submitted that the sale proceeds for which cash was received from the customers was already admitted as income and if the cash deposits are added under section 68 of the Act that will amount to double taxation once as sales and again as unexplained cash credit which is against the principles of taxation. It was also submitted that the assessee was having only one source of income from beedi, tea power and pan masala and therefore provisions of section 115BBE of the Act will have no application so as to treat the income of the assessee as income from other sources. It was also submitted that the government permitted all to deposit old demonetized notes upto 31-12-2016. Since the amounts deposited were sale proceeds of business and the income from the business have already been taxed, the impugned addition should be deleted. Our attention was also drawn to section 26(2) of the RBI Act, 1934 which provides that government can specify certain notes as not legal tender. It was argued that if there is any violation of the statutory provisions, the consequences will be only under the relevant provisions of RBI Act, 1934 and those ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Vishal Exports Overseas Ltd. (supra), Hence, we do not see any reason to interfere with the order of the Ld.CIT(A) and the same is upheld. 10. The assessee filed cross objections supporting the order of the Id. CIT(A). Since, the appeal of the revenue is dismissed, the cross objection filed by the assessee becomes infructuous, hence, dismissed. 11. In the result, appeal of the revenue as well as the cross objection of the assessee are dismissed. 8. Learned DR reiterated the stand of the Revenue as reflected in the order of the CIT(A). 9. I have carefully considered the rival submissions. Both the AO and CIT(A) accepted the fact that the cash receipts are nothing but sale proceeds in the business of the assessee. The addition has been made only on the basis that after demonetization, the demonetized notes could not have been accepted as valid tender. Since the sale proceeds for which cash was received from the customers was already admitted as income and if the cash deposits are added under section 68 of the Act that will amount to double taxation once as sales and again as unexplained cash credit which is against the principles of taxation. It is also on record that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ses) - Assessment years 2012-13 to 2014-15 Assessee-company was engaged in business of selling dry fruits - Assessing Officer on basis of statement of director of assessee-company which was recorded during search held that assessee booked bogus purchases in its books of account to inflate expenses and to educe its taxable profits, and made an addition at rate of 25 per cent of such purchases - It was noted that said additions were made without conducting any enquiry - Furthermore, entire purchase and sale transactions were duly recorded in regular books of account of all parties concerned and were channels - routed through regular banking Also, in original assessments, all these details were verified and assessments were framed under section 143(3) Whether, in view of above facts, since no - incriminating evidences were found, impugned addition was to be deleted - Held, yes [Para 15.1] [In favour of assessee] III. Section 69C of the Income-tax Act, 1961 - Unexplained expenditure (Bogus purchases) - Assessment years 201516 to 2017-18 - Assessee-company was engaged in business of selling dry fruits Assessing Officer made addition on - account of bogus purchases at rate of 25 per ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ccounts and the said deposits have been duly recorded in the books of account are not disputed. It is the submission of the assessee that it had received advance money from walk in customers for sale of jewellery over the counter and the amount so received was duly recorded in the books of account. The said amount alongwith other cash balance available with the assessee was deposited into the bank account after announcement of demonetization by the Government of India. He also submitted that the assessee has raised sale bills against the said advances in the name of respective customers. Since the transaction was less than Rs. 2.00 lakhs, it was stated that the assessee did not collect complete details of the customers. Thus, it is seen that the advance amount collected from customers, the sales bill raised against them etc., have been duly recorded in the books of account. The impugned deposits have been made from cash balance available with books of account. I also notice that the Assessing Officer has not rejected the books of account. When cash deposits have been made from the cash balance available in the books of account, in my view, there is no question of treating the said ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d that the Assessing Officer has not disputed on the quantity of stocks maintained in the register, and stock valuation in the Audited financial statements and also the turnover reflected by way of cash sales and bank credits. The assessing officer has accepted the sales and corresponding nexus with the purchases and closing stock of goods. We find the CIT(A) has dealt on the facts, provisions of law, submissions and judicial decisions and has passed a conclusive and reasoned order. Accordingly, we do not find any infirmity in the order of the CIT(A) on the disputed issues and uphold the same and dismiss the grounds of appeal of the revenue. 30. In the result, the appeal filed by the revenue is dismissed. 31. ITA.No. 3062/Mum/2022 (Assessee Appeal) The assessee has raised the following grounds of appeal: The Commissioner of Income-tax (Appeals) - 47, Mumbai (hereinafter referred to as the CIT(A)) erred in sustaining aggregate addition made by the Deputy Commissioner of Income-tax, Central Circle 1(1), Mumbai (hereinafter referred to as the Assessing Officer) of Rs 8,19,153 under section 68 of the Act, received through banking channel on sale of stock recorded in the re ..... 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