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TMI Blog2024 (12) TMI 1379X X X X Extracts X X X X X X X X Extracts X X X X ..... assess only the peak credit and no further addition is to be made - Appeal filed by the Revenue is dismissed. - Shri Mahavir Singh, Vice President And Shri S.R. Raghunatha, Accountant Member For the Appellant : Shri Clement Ramesh Kumar, CIT For the Respondent : Shri T. Banusekar, Advocate ORDER PER MAHAVIR SINGH, VICE PRESIDENT: This appeal by the Revenue is arising out of the order of the Commissioner of Income Tax (Appeals)-6, Chennai in ITA No.128/CIT(A)-6/2018-19 dated 13.09.2020. The assessment was framed by the Income Tax Officer, Corporate Ward-2(4), Chennai for the assessment year 2005-06 u/s. 143(3)/147 r.w.s. 254 of the Income Tax Act, 1961 (hereinafter the Act ) vide order dated 26.12.2018. 2. The only issue in this appeal of Revenue is against the order of CIT(A) deleting the addition made by AO while giving effect to the order of Tribunal u/s. 143(3) r.w.s. 147 r.w.s. 254 of the Act dated 26.12.2018, wherein the income assessed u/s. 143(3) r.w.s. 147 of the Act dated 02.04.2013 was adopted at Rs. 26,03,26,145/-. The Revenue has raised the following grounds for the same:- (b) Whether on the facts and circumstances of the case and in law, is it correct on the part of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... A)-6 to delete the additions without appreciating the fact that benefit of peak credit has been given for cash deposit and withdrawal only whereas addition of Rs. 46,54,548/- and Rs. 24,59,12,368/- represents unexplained deposit by way of cheque and bank transfer in different undisclosed bank accounts and to/from different persons. 3. At the outset, the ld.CIT-DR stated that the original assessment was completed u/s. 143(3) r.w.s. 147 of the Act dated 02.04.2013 for the relevant assessment year 2005-06 and this assessment was challenged before the CIT(A). The CIT(A) vide his order in ITA No.1843/2013-14 dated 22.12.2014 dismissed the issue of assessee s appeal vide para 8 as under:- 9 Ground Nos.6 s 7: Addition of Rs. 24,59,12,368/-: This being undisclosed income of his father added in the hands of the appellant. In this regard, the appellant's AR submitted that this was already considered in the assessment of his father. In the assessment order, the AO has brought out this fact as follows : Para.2 of Page-3: As could not correlate all the deposits and drawings routed through the bank account, I am advised to offer additional income related to Peak Credit in several bank accoun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e addition of Rs. 2.99 Cr., the pre-credit in respect of the said bank account is to be added if the same is included, no further addition is to be made. The AO has to verify whether the amount. of Rs. 75.00 lakhs added is in respect, of any of the undisclosed bank account which have been found in the course of search and the peak credits added representing Rs. 2.99 Cr. If the answer is YES, no further addition is called for, if the answer is No', then the addition on this account is to be restricted to Rs. 7.5O lakhs as confirmed by the assessee in his letter dated 05.10:2012 addressed to the ACIT, Unit-IV(2), Chennai. If the addition of Rs. 2.99 Cr. includes the peak credits in respect of the bank accounts Considered in the hands of Shri V.Gurunathan then no further addition on is liable to be made in the hands of Shri V.Gurunathan, With these directions, the appeals in both the assessees cases are restored to the file of the AO for re-adjudication. In view of the above, the ld.CIT-DR stated that there are three additions directed to be verified and to be considered by Tribunal in above para 8 of the Tribunal s order but now, only one issue remains is the third issue as regar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mmunicate the contents of the miscellaneous petition filed by the assessee Shri V.G.Rajendran, and act as per law so that no addition is taxed twice. The above direction of the Hon'ble ITAT ,D Bench is taken on record. 14. With the above discussions, the assessment order is completed by arriving at the assessed income as under: Income assessed as per order u/s 143(3) r.w.s.147 dated 02.04.2013 : Rs.26,03,26,145/- Less: 1. Relief allowed as discussed in Para 11 above : Rs. 7,20,000/- 2. Relief allowed as discussed in Para 12 : Rs. 67,50,000/- Income assessed as per present order : Rs.25,28,56,145/- Aggrieved, assessee preferred appeal before CIT(A) on this issue. 4. The ld.CIT-DR then took us through the order of CIT(A) (impugned order) passed in ITA No.128/CIT(A)-6/2018 dated 18.09.2020, wherein the CIT(A) has deleted the addition made by AO of Rs. 26,03,26,145/- by observing in paras 4.10.2 to 4.10.7 as under:- 4.10.2 As has been elaborately explained in the above referred CIT(A) Order, the appellant followed a practice of cyclic/circular transactions, wherein, whenever the appellant was in need of funds, he would present cheques of various persons (from the unaccounted Bank a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... redit of Rs. 2 99 Crs. The Hon'ble ITAT has upheld that the addition to be made in the case of the appellant is the peak credit calculated by considering all the undisclosed Bank accounts, including the Bank accounts of Shri.V. Gurunathan. The very specific reason for which this issue was set aside to the A.O. was to verity if the said Bank Account discussed supra was included in the Peak Credit computation or not. The Hon'ble ITAT has further clarified that no addition should be made twice. 4.10.4 This issue has to be guided by the directions of Hon'ble ITAT as stated earlier. The Hon'ble ITAT in its Order dated 23.11.2017 had, while jointly adjudicating the interrelated cases of the appellant and appellant's father, held that the total income which is to be taxed is the Peak Credit of Rs. 2.99 Crs and the matter on this issue was set aside to A.O, to verify if the Peak Credit amount has been calculated after considering the bank account of appellant's father. Based on the calculation of Peak Credit which was thoroughly analysed in the Order of CIT(A)-2, Chennai, in the case of the appellant's father, it is seen that the said Bank account has been duly ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Bank account of the appellant's father Shri.V.Gurunathan is duly considered for the purpose of calculating Peak Credit in the hands of the appellant and the Hon'ble ITAT had set-aside this issue for the same to be verified and then instructed that the same issue should not result in double addition. But the A.O has erred on this issue while concluding the Order and it is not in line with the directions issued by Hon'ble ITAT. Moreover, it must be emphasized that the peak credit of Rs. 2. 99 Crs has already been added and offered to tax by the appellant in AY. 2005-06 and A.Y.2006-07 put together, based on the working of the Peak Credit mentioned supra. 4.10.7 Considering the above discussion and as per the directions of Hon'ble ITAT, since the A.O. has found that the said Bank account is considered for the purpose of computing the Peak Credit Balance of Rs. 2.99 Crs, no further addition is to be made on this issue. Hence, as directed by the Hon'ble ITAT, as his Bank account has already been considered for the purpose of Peak Credit computation of Rs. 2.99 Crs, no further addition is to be made on this account. Aggrieved, now Revenue is in appeal before us. 5. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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