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TMI Blog2024 (11) TMI 1187X X X X Extracts X X X X X X X X Extracts X X X X ..... essee, so, once cash purchases / sales based on vouchers had been accepted, there is no point in making addition on the deposit of such cash in the bank account, particularity on cash sales. Assessee has explained the source of such cash deposits and it has also explained that such cash sales are subject to VAT where VAT has been collected and deposited with the Government treasury. In support of her explanation, the Assessee has furnished the documents of the relevant period of VAT returns, copy of trading and profit and loss accounts and balance sheets, which are duly audited. We find that the AO has accepted the cash sales and has also accepted the VAT collected and deposited in the Government account. Even the Assessing Officer has acce ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has taken plea that the area is exempt from VAT but how is it possible that maximum of sale was reported in Parwanoo. office which seems to be dubious as the assessee has reported her sale in branch office Parwanoo to evade the taxes. 2. The Ld. CIT(A) has completely ignored the human probabilities that how it is possible to the assessee to not open the bank account in Parwanoo office and continuously travelling with the cash to Ludhiana even without proper securities and other things. 3. The Ld. CIT(A) has ignored the factual findings made by the AO in the Assessment Order, the Inspection report and surrounding evidence such as necessity of strong room in Parwanoo office, assessee s failure to present the landlord before the AO during asse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... der consideration, apart from business and profession, the Assessee has derived income from other sources also. Return for A.Y. 2017-18 was filed on 27.10.2017 declaring total income of Rs. 33,22,130/-. In the assessment order, the Assessing Officer had observed that from the records it is found that the Assessee does not maintain any bank account in Parwanoo and it has bank account only in Ludhiana. The assessment was completed u/s 143(3) of the Act making disallowance u/s 68 of the Act amounting to Rs. 13,49,76,182/- and addition on account of interest paid of Rs. 94,40,163/-. 4. In the assessment order, the Assessing Officer has given his finding that during the year under consideration, the Assessee had made cash deposits of Rs. 18,56,5 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... counts of Pareanoo Branch, copy of sale and purchase ledgers at Parwanoo Branch etc., both before the Assessing Officer and the CIT(A). The Assessee also submitted complete set of books of account before the Assessing Officer of Parwanoo Branch and stand alone audited balance sheets and profit and loss accounts of Parwanoo Branch. The Assessing Officer did not doubt the purchases at Parwanoo branch but cash sales at Parwanoo was rejected by the Assessing Officer. 5. Aggrieved with this order, the Assessee filed an appeal before the ld. CIT(A). The ld. CIT(A) in his order has given finding that discrepancies were explained by the Assessee and the discrepancies pointed out by the Assessing Officer were without bringing any adverse material on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... accepted, therefore, CIT(A) s finding that neither the purchases made by the Assessee nor the details of stock furnished have been doubted then there was no question of doubting the sale of the Assessee out of the said stock and accordingly the ld. CIT(A) deleted the addition. 6. Against the order of the CIT(A), the Department has preferred this appeal before us. 7. The ld. DR heavily relied on the finding of the Assessing Officer in the assessment order, enquiry made by the Assessing Officer and the enquiry report of the Inspector were highlighted by the ld. DR and it was argued that cash deposit in the banks during the demonization period was mainly of demonetized currency and as such cash sales at Parwnoo branch of the show room of the A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... loss accounts and balance sheets, which are duly audited. We find that the Assessing Officer has accepted the cash sales and the Assessing Officer has also accepted the VAT collected and deposited in the Government account. Even the Assessing Officer has accepted the VAT returns filed by the Assessee and accepted by the Indirect Taxes Department. Therefore, it clearly shows that the Assessing Officer has not doubted the availability of cash in the hands of the Assessee. Once availability of cash in the hands of the Assessee is accepted, then deposit of such cash in bank account cannot be rejected. 10. Lastly, we find that accepting the cash sale by the Assessee offered to tax, and then addition of same cash deposited in the bank, will amoun ..... X X X X Extracts X X X X X X X X Extracts X X X X
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