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TMI Blog2024 (12) TMI 1334X X X X Extracts X X X X X X X X Extracts X X X X ..... tained in the ordinary course of the business of the assessee. Addition u/s 68 of the Act in the case of the assessee is not sustainable - Decided in favour of assessee. X X X X Extracts X X X X X X X X Extracts X X X X ..... k passbook/statement does not constitute books of account. 4. Ld. Counsel for the assessee further referring to provisions of section 2(12A) of the Act which defines "books or books of account" submits that the definition of books under the Act is inclusive. A perusal of the definition shows that the same does not include bank passbook or bank statement. A conjoint reading of above provisions would thus leave to the conclusion that the addition u/s 68 of the Act can be made only where any amount is found credited in the books as defined u/s 2(12A) of the Act maintained by the assessee. For the above proposition the Ld. Counsel places reliance on the decision of the Hon'ble Jurisdictional High Court in the case of CIT Vs. M/s Mayawati (338 ITR 563) and the decision of the coordinate bench in the case of Smt. Babbal Bhatia Vs. ITO in ITA No.5430/Del/2011 dated 08.06.2018. The Ld. Counsel thus submits that a cash credit appearing in assessee's passbook relevant to a particular previous year, in a case where the assessee does not maintain books of account does not attract the provisions of section 68 of the Act. 5. On the other hand, the Ld. DR submits that in the case of Janak Goyal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , therefore, the said charging of section 68 cannot be pressed to service." 4. Since the grievance raised vide additional ground goes to the root of the matter, we decided to hear the representatives of both the sides on this point of law. 5. Briefly stated, the facts of the case are that as per the ITD system, the Assessing Officer came to know that the assessee has deposited cash in bank accounts maintained with Indian Bank, State Bank of India and State Bank of Hyderabad and has also received rent. On finding that no return was filed, proceedings u/s 147 of the Act were initiated after recorded reasons and accordingly, statutory notice u/s 148 of the Act was issued and served upon the assessee. In response to the notice, the assessee filed returns of income for the respective assessment years. 6. The assessee was asked to explain the sources of the cash deposited in the bank accounts. The assessee filed cash flow statement alongwith with the submission that part of the cash deposited was received from sales and balance amount represents withdrawals made from other banks. 7. The Assessing Officer was of the opinion that the returned income of the assessee does not in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... upon the decision of the coordinate Bench of the Tribunal in the case of Renu Aggarwal 22 Taxmann.com 94 which was affirmed by the Hon'ble High Court of Allahabad in 358 ITR 483. The ld. DR also relied upon the decision of the Hon'ble Bombay High Court in the case of Arun Kumar J. Muchhala [2017] 85 Taxmann.com 306. 13. The ld. DR concluded by stating that the additions have been made by the Assessing Officer because the assessee could not explain the sources of cash deposits in the bank accounts and it is immaterial to say that the additions cannot be made u/s 68 because in any case the additions have to be made. 14. Representative of both the sides were heard at length, case records carefully perused and judicial decisions carefully considered. The undisputed fact is that the cash was deposited in the bank accounts of the assessee. It is true that the returned income does not match the presumptive rate of tax on the gross turnover of the assessee. It is equally true that in the returns of income itself the assessee made it very clear that she is not maintaining books of account. If the revenue authorities were of the view that the returns have not been filed as per p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r the explanation offered by him is not satisfactory. 5. As the Tribunal has pointed out, it is fairly well settled that when moneys are deposited in a bank, the relationship that is constituted between the banker and the customer is one of debtor and creditor and not of trustee and beneficiary. Applying this principle, the pass book supplied by the bank to its constituent is only a copy of the constituent's account in the books maintained by the bank. It is not as if the pass book is maintained by the bank as the agent of the constituent, nor can it be said that the pass book is maintained by the bank under the instructions of the constituent. In view of this, the Tribunal was, with respect, justified in holding that the pass book supplied by the bank to the assessee in the present case could not be regarded as a book of the assessee, that is, a book maintained by the assessee or under his instructions. In our view, the Tribunal was justified in the conclusions at which it arrived." 18. The Hon'ble jurisdictional High Court of Delhi in the case of CIT Vs. Ms. Mayawati reported in 338 ITR 563 [DEL] has held as under: "As the ITAT has come to the conclusion t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... herein the Hon'ble High Court has held as under: "As the Tribunal has pointed out, it is fairly well settled that when moneys are deposited in a bank, the relationship that is constituted between the banker and the customer is one of debtor and creditor and not of trustee and beneficiary. Applying this principle, the pass book supplied by the bank to its constituent is only a copy of the constituent's account in the books maintained by the bank. It is not as if the pass book is maintained by the bank as the agent of the constituent, nor can it be said that the pass book is maintained by the bank under the instructions of the constituent. In view of this, the Tribunal was, with respect, justified in holding that the pass book supplied by the bank to the assessee in the present case could not be regarded as a book of the assessee, that is, a book maintained by the assessee or under his instructions. In our view, the Tribunal was justified in the conclusions at which it arrived." 21. In the case of Anandram Ratiani, the Hon'ble Guwahati High Court has also held that a perusal of section 68 of the Act shows that in relation to expression "books" the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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