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TMI Blog2024 (10) TMI 596X X X X Extracts X X X X X X X X Extracts X X X X ..... 50 - GUJARAT HIGH COURT] support this conclusion by establishing that once cash withdrawals are demonstrated, the burden shifts to the Department to disprove their availability for subsequent deposits. Claim of the deposits came from USD conversions - We concur with the CIT(A) s findings that the absence of forex receipts is a critical flaw. We cannot accept the assessee s claim without documentary evidence from an authorized money exchanger. The conversion of foreign currency to INR is a highly regulated process, and the failure to provide documentation creates a significant evidentiary gap. Thus, we conclude that the addition has been satisfactorily explained through documented cash withdrawals. The remaining amount claimed to be sourced ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on 2nd and 3rd December 2016 totalling to Rs. 12,00,000/-. The case was selected for scrutiny, and the AO questioned the source of these cash deposits. The assessee explained that the funds were accumulated from cash withdrawals from his bank accounts with ICICI Bank and State Bank of India (SBI) over the years and from the money left over from USD withdrawals made from his Bank of America (BOA) account during his visits to India between 2012 and 2015. The assessee also submitted that the cash corpus was given to family members for social and medical purposes, and that his brother, Shri Mahesh Gadhia, acted as the custodian of these funds. During demonetization, the family returned the money, which was then deposited in the bank. The AO, ho ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e cash withdrawals or to demonstrate that the funds had been used elsewhere. The assessee further argued that the affidavit of Shri Mahesh Gadhia, his brother, should have been given more weight, as it confirmed the custodianship and return of the funds during demonetization. After reviewing the remand report and the assessee's rebuttal, the CIT(A) upheld the AO s findings. During the appellate proceedings before the CIT(A), the assessee relied on several judicial precedents to support his case. The CIT(A concluded that the judicial precedents cited by the assessee did not apply to the facts of this case due to absence of evidence regarding the foreign exchange conversion, significant timing gaps between the cash withdrawals (2012-2015) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in law and on facts of the case in confirming action of the Id. AO in charging interest u/s. 234A, 234B, 234C of the Act. The appellant craves leave to add, amend, alter, edit, delete, modify or change all or any of the grounds of appeal at the time of or before the hearing of the appeal. 4. During the course of hearing before us, the Authorised Representative (AR) of the assessee reiterated that the cash deposited were out of cash withdrawals from assessee s own bank account in India and USA. The AR further argued that the funds were parked with the family members and placed a copy of the affidavit of the brother of assessee to this effect. The AR also submitted the copy of statement showing cash withdrawals from ICICI Bank and SBI along w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... wing the cash withdrawals, an affidavit from Shri Mahesh Gadhia affirming that he held the funds as custodian and returned them during demonetization and a cash flow statement explaining the withdrawals and the deposits made during the demonetization period. The affidavit stated that these funds were returned to the assessee during demonetization and subsequently deposited into his ICICI Bank account. The affidavit also mentioned that the funds were partially used by family members for social and medical purposes and were returned when demonetization occurred. The affidavit confirmed the timing of the return of the funds, which took place during the demonetization window, explaining the large cash deposits made in December 2016. 6.1. The se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... wn funds were used for any other purposes, and the Department has not provided contrary evidence. Therefore, the Tribunal concludes that the withdrawals from these accounts should be treated as the source for Rs. 8,30,000/- of the deposits during demonetization. Judicial precedents, such as, judgement of Jurisdictional High Court in the case of Shailesh Rasiklal Mehta reported at (2009) 176 taxmann.com 270 (Gujarat) , support this conclusion by establishing that once cash withdrawals are demonstrated, the burden shifts to the Department to disprove their availability for subsequent deposits. 6.4. Regarding the claim that Rs. 3,70,000/- of the deposits came from USD conversions, we concur with the CIT(A) s findings that the absence of forex ..... X X X X Extracts X X X X X X X X Extracts X X X X
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