9911796707
TMI Blog2024 (10) TMI 1637X X X X Extracts X X X X X X X X Extracts X X X X ..... to the hilt that the amount of cash withdrawals of Rs.78.80 lacs (out of cash withdrawals of Rs.98.80 lacs) made by the assessee during the pre-demonetisation period, i.e. in September, 2016 was thereafter invested/utilized by the assessee somewhere else and, thus was not available with him to source the cash deposits in SBNs in his bank accounts during the demonetization period, therefore, there could have been no justification on his part to have held the cash deposits as the assessee's unexplained money u/s. 69A of the Act. Accordingly, we herein vacate the addition made/sustained by the lower authorities. Appeal of the assessee is allowed X X X X Extracts X X X X X X X X Extracts X X X X ..... produce confirmations of the persons who had made the cash withdrawals from the banks or produce them physically for examination before him. In reply, it was submitted by the assessee that the cash withdrawals were made for the purpose of his business by his staff members. The A.O on a perusal of the bank account details observed that though the assessee during the subject year had total receipts of Rs.86,01,557/- and claimed expenses of Rs.77,26,557/-, but he had made cash withdrawals of Rs.98,80,000/- in the month of September, 2016. The A.O was of the view that the assessee had himself contradicted his claim that the cash withdrawals were made for his business purpose. The A.O observed that the assessee had deposited cash on various dates during the demonetization period, and was of the view that if the assessee had cash in hand of Rs.62 lacs available with him on 08.11.2016, then he would have deposited the same in one go and not spread the same on various dates. Further, the A.O held a firm conviction that no person of common prudence would keep such huge amount as cash in hand for more than 2 months at his home with all the risk of life and security, and rather would deposit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee by the AO and the additions are made as per the provisions of law. No evidence whatsoever has been filed by the assessee to substantiate and buttress the grounds of appeal. The assessee has not submitted any proof in support of its contention that it had been carrying on business during the year. The assessee has also not established that it had been carrying on similar business in the earlier years and subsequent years and that it had the consistent practice of depositing a large amounts of cash in its bank accounts every year before and after the A.Y.2017-18. If the assessee had the cash in hand of Rs.62,00,000/- on 08/11/2016, he would have deposited the same in one go and not on various dates. Further, no person of common prudence will keep such high cash in hand for more than 2 months in his home with all risk of life and security, further depositing it with bank and earn interest of at least 34%. The story advanced by the assessee during the assessment proceedings is beyond human probabilities and cannot be accepted. It was also seen that the bulk of money had been deposited in his saving bank account and not in his current account. If the money was withdrawn fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d). The Ld.AR submitted that the assessee had during the subject year made cash withdrawals in tranches of Rs.98.80 lacs out of which, he had made cash deposits of Rs.62 lacs during the demonetization period. On being queried about the balance amount, it was submitted by the Ld. AR that out of cash withdrawals of Rs.98.80 lacs, an amount of Rs.20 lacs was deposited by the assessee in his bank account No.02981000008865 during the pre-demonetization period in three tranches, viz. (i) 27.10.2016: Rs. 2,00,000/; (ii) 27.10.2016: Rs.9,00,000/-; and (iii) 27.10.2016: Rs.9,00,000/-. It was the claim of the Ld. AR that after depositing an amount of Rs.20 lacs (supra), there remained a balance amount of Rs.78,80,000/- which had sourced the cash deposits of Rs.62 lacs in assessee's bank account. 10. Per contra, the Ld. Sr. Departmental Representative (for short 'DR') relied on the orders of the lower authorities. 11. We have heard the Ld. Authorized Representatives of both the parties, perused the orders of the lower authorities and the material available on record. 12. Admittedly, it is a matter of fact borne from record that the assessee in the course of assessment proceedings had vide ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e subject year by M/s. Rajgharia Industrial Equipment Pvt. Ltd. to the assessee, as under: Date Amount 09.09.2016 Rs.19,50,000/- 12.09.2016 Rs.12,50,000/- Rs.11,80,000/- 23.09.2016 Rs.5,00,000/- 26.09.2016 Rs.17,00,000/- 27.09.2016 Rs.16,50,000/- 28.09.2016 Rs.6,50,000/- 29.09.2016 Rs.10,00,000/- 05.10.2016 Rs.1,80,000/- Total Rs.1,00,60,000/- For the sake of clarity, the copy of bank statement supporting the aforesaid factual position is culled out as under (relevant extract): Also, we find that the assessee had made cash withdrawals amounting to Rs.98,80,000/- during the pre-demonetization period in various tranches, viz. (i) 19.09.2016 : Rs.19,50,000/-; (ii) 22.09.2016 : Rs.24,30,000/-; (iii) 23.09.2016 : Rs.5,00,000/-; (iv) 26.09.2016 : Rs.17,00,000/-; (v) 27.09.2016 : Rs.16,50,000/-; (vi) 28.09.2016 : 6,50,000/-; and (vii) 30.09.2016 : Rs.10,00,000/-. 14. As observed by us hereinabove, M/s. Rajgharia Industrial Equipment Pvt. Ltd. had during the year under consideration made part repayment of loans of Rs1,00,60,000/- to the assessee, which amount was credited in the assessee's savings bank account No.02981000008865 with Punjab & Sind Bank, Raipur (copy o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ingle go in his bank account, but had spread over the same in tranches, we are unable to concur with the drawing of the adverse inferences by the A.O on the said count. Admittedly, it is a matter of fact borne from record that the assessee had made cash deposits in SBNs of Rs.62 lacs in his bank accounts, during the demonetization period, viz. (i) Savings bank A/c. No.02981000008865 : Rs.3,00,000/-; (ii) Savings Bank account No.02981100004062 : Rs.36,00,000/-; and (iii) Current Bank account No.11571100000074 : Rs.23,00,000/-. Although the observation of the A.O that in case the assessee was having substantial amount of demonetized currency/cash available with him then he ought to have deposited the entire amount in a single go during the demonetization period at the first blush appeared to be convincing but are afraid that the same is far from ground reality. At the threshold, we are of the view that spread over of the cash deposits in SBNs by the assessee during the demonetization period in tranches is supported by the fact that the amounts had been deposited by him in his three bank accounts. Apart from that, we are of the view that as carrying substantial amount of cash during t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dow to the citizens for depositing the demonetized currency in their bank accounts within a specified time frame i.e. 09.11.2016 to 31.12.2016, therefore, the assessee at the relevant point of time would have been driven by need of depositing the said demonetized currency/SBNs in his bank accounts. Apart from that, we are unable to fathom as to how the A.O could have regulated the manner in which the cash deposits in SBNs were to be made by the assessee in his bank accounts. As the aforesaid observation of the A.O is devoid and bereft of any substance, therefore, we are unable to persuade ourselves to subscribe to the same. 21. Apropos the observation of the A.O that though the assessee as per his written submission dated 24.12.2019 filed before him had disclosed cash in hand of Rs.22,95,424/- on 31.03.2017 but in his return of income had disclosed the same at Rs.1,55,240/-, we are of the view that same would not carry the case of the department any further. Although, we are principally in agreement with the A.O that the cash in hand available with the assessee as on 31.03.2017, i.e. both as per the written submission dated 24.12.2019 and that disclosed in return of income for A.Y ..... X X X X Extracts X X X X X X X X Extracts X X X X
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