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TMI Blog2024 (10) TMI 853X X X X Extracts X X X X X X X X Extracts X X X X ..... les made during the year and the books of accounts of the assessee. We find considerable force in the ld AR argument that when the AO has not questioned the audited books of account and the cash flow statement and cash book, he cannot draw an adverse view without bringing any contrary cogent material. AO has also not pointed out any element of undisclosed income in the form of cash sales and has also not substantiated as to how the cash deposits relates to the assessee s unaccounted income. When the AO draws the conclusion that the cash in hand definitely bears some unaccounted income of the assessee , we find that the AO has travelled in the realm of conjectures. We also note that the Assessing Officer s conclusion that 60% of the cash dep ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stock register maintained properly by the appellant. iii) The CIT (A) as well as learned assessing officer erred and bad in law and facts by not considering the fact that administrative office of the company shifted to Gurgaon during the financial year under consideration resulting it is very difficult to regularly deposit the cash in Pitampura bank branch. iv) The appellant has duly submitted the stock register and cash ledger showing the sale has been made out of the stock available to the appellant and duly accounted in the books of accounts and reconciled with VAT return for the respective periods. v) The learned assessing officer erred in passing the impugned order in violation of principle. of natural justice and not giving the oppor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l and void ab initio. The ld AR relied on the judgment of the Hon'ble Supreme Court in the case of NTPC 229 ITR 383 and Singhad Technical Education Society 397 ITR 344. 8. We have carefully considered the orders of the authorities below qua the additional ground raised by the assessee. We find that the issue raised is a legal one. Respectfully following the judgment of the Hon'ble Supreme Court in the case of NTPC [supra], we admit the additional ground of appeal. 9. Briefly stated, the facts of the case are that the assessee is engaged in the business of trading of various types of plastic sheet, plastic items and ball bearing and others merchandise items. 10. The Assessing Officer passed assessment order u/s 143(3) dated 27.12.201 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... submitted that it amounted to double taxation of the same profit. It was argued that cash flow statement is merely rejected by the Assessing Officer on false hypothesis and conjectures without bringing on record any material evidence to show any other utilization of such cash available in hands of assessee. It was further argued that there is no SCN issued prior to impugned asst. as per CBDT Instruction No.20/2015 dated 29.12.2015 which is fatal to impugned asst. 16. The ld. counsel for the assessee further submitted that having accepted the books of accounts by both the authorities, book results could not be disturbed once it is admitted that cash sales are recorded in books and forming part of turnover of the business. For this propositio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e proposed additions/disallowances along with necessary evidences/reasons forming the basis of the same. Before passing the final order against the proposed additions/disallowances, due consideration shall be given to the submissions made by the assessee in response to the show cause notice. 18. Per contra, the ld. DR relied upon the orders of the Assessing Officer. 19. We have heard the rival submissions and have perused the relevant material on record. We find that the Assessing Officer has made the addition only on the ground that the assessee has not explained the holding of cash receipt in hand instead of depositing the same in bank as was done in A.Y 2016-17. The Assessing Officer came to the conclusion that as the assessee has not ke ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... efully apply to the facts and circumstances of the instant case. The Hon ble Supreme Court Lalchand Bhagat Ambica Ram (supra) had held that when entries in books of accounts in regard to cash balances were held to be genuine, there can be no escape from the conclusion that assessee had offered reasonable explanation as to source of all high denomination notes which it encashed on 19th January 1946 and it was not open to ITAT to accept genuineness of those books and accept assessee s explanation in part and reject the same in regard to balance sum. In the instant case, the AO has relied on the figures of cash deposits on the basis of books of accounts of the assessee and once he relies on the book results, he cannot reject the assessee expla ..... X X X X Extracts X X X X X X X X Extracts X X X X
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