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TMI Blog2024 (7) TMI 1051X X X X Extracts X X X X X X X X Extracts X X X X ..... ee are fictitious/bogus. The purchases are entirely through imports. Revenue has also failed to place any material on the record to demonstrate that the VAT returns of the relevant year have not been accepted by the VAT authority and the Custom authority has not accepted the imports/purchases. Hence, following the reasoning given in the case of Ramesh Kochar, addition under section 69A of the Act is uncalled for and the CIT(A) is justified in deleting the same. Appeal of the Revenue stands dismissed. - Ms. Madhumita Roy, Judicial Member And Shri Avdhesh Kumar Mishra, Accountant Member For the Respondent : Sh. Kanv Bali , Sr. DR For the Appellant : Sh. NeerajMangla, CA ORDER PER AVDHESH KUMAR MISHRA, AM: The instant appeal of the Assessmen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eserves right to add, amend or alter the grounds of appeal on or, before the date of the disposal. 3. The Ld. Sr. Departmental Representative (In short, the Sr. DR ) vehemently argued the case emphasizing the details highlighted in para 2.2 of the assessment order wherein it was mentioned that the cash sales of Rs. 65,53,340/-had taken place on various days during the period 05.10.2016 to 19.10.2016 and 02.01.2016 to 18.01.2017 and there was no cash sales prior to 05.10.2016 when the respondent/assessee was having imported goods worth Rs. 2.68 Crores as stock-in-trade in September, 2016. The Ld. AO also doubted the cash sales on the reasoning that the sales taken place during October had not been deposited within the reasonable time of 02-0 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... days were not deposited in the bank on the respective day of sale. 2.3 When the assessee has failed to prove that in his normal business or otherwise, he was possessed of so much money, it is to be held that the money by virtue of credit entries or in the shape of cash deposits represents the earning of the assessee during the year from undisclosed sources within the meaning of Section 69A of the Act. Section 69A of the Act deals with money, etc. owned by the assessee and found in possession including in the bank accounts of the assessee which remained unexplained. The relevant portion of the same is reproduced herein under: Section 69A - .. In the instant case, the assessee is found to be the owner of the money appearing in its bank accoun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the Revenue. 2.4. To bring more clarity of facts on record, the assessee was asked to appear for his personal deposition and the summon issued u/s 131 of the Act to one of the partners for this purpose but was not complied with by him. The assessee has not responded to the notices issued u/s 142(1) of the Act satisfactorily and also to the show cause issued during the proceeding. As the assessee failed to offer any explanation about the nature and source of cash deposits appearing in the banks as detailed above, the sum of Rs. 65,53,340 stated to have been achieved through cash sales is deemed as unexplained money within the meaning of Section 69A of the Act and the same is taxed at the special rate as per the provisions of Section 115BBE ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er the Circular No.3/2018 dated 11.07.2018 read with the Circular No.17/2019 dated 08.08.2019. To this, the Ld. Sr. DR submitted that the tax effect was above the threshold limit for filing appeal as per the Circular No.3/2018 dated 11.07.2018 read with the Circular No.17/2019 dated 08.08.2019. 5.2 It was further submitted that the cash sales had taken place in January, 2017 and afterward also. Therefore, the AO s conclusion that cash sales had not taken place after the demonetization period was factually incorrect. With the help of original revised VAT returns, the Ld. AR demonstrated that there was no substantial change in the turnover in the revised return in 3rd Quarter of FY 2016-17. In revised VAT returns, some clerical errors/mistake ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e tax effect is below Rs. 50,00,000/-. Then this appeal has to be held as non-maintainable and dispose of accordingly as dismissed. Otherwise also, we are deciding this appeal on merit also. 6.1 We find force in the arguments/contentions/ submission of the Ld. AR. that (i) the reasons for revising the VAT returns were justified, (ii) cash sales cannot take place before import/commencement of business in Sept., 2016, (iii) Cash deposits prior to commencement of business in Sept., 2016 cannot take place. Hence, the AO s observation that cash deposit was only Rs. 2,000/- from 01.04.2016 to 08.11.2016 loses relevance, (iv) the business man deposits sale consideration on respective dates of sales. It is normally deposited as when need arises. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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