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TMI Blog2025 (2) TMI 1034X X X X Extracts X X X X X X X X Extracts X X X X ..... for AY 2017-18. 2. Since these appeals involve identical issue, they were heard together at the request of parties and are being disposed of by this consolidated order for the sake of convenience. ITA No. 1/Ind/2023 of Shri Deepak Soni: 3. The registry has informed a delay of 69 days in this appeal. Ld. AR for assessee submitted that the assessee has filed a condonation-application supported by an affidavit. Referring to contents of same, Ld. AR explained that the delay has occurred due to the local counsel of assessee (Shri Jitendra Jain) as well as presently arguing counsel (Shri Gagan Tiwari) who were engaged for handling this appeal of assessee. To explain facts of delay, Ld. AR iterated Para No. 5 to 11 of condonation-application wherein it is stated by assessee that he communicated the impugned order dated 26.08.2022 to his local counsel on the very same day and thereafter got engaged in business activity due to forthcoming season of Diwali. Subsequently, when he contacted local counsel in the month of December, the local counsel informed that the appeal had not been filed and another counsel had to be engaged. Thereafter on 07.12.2022, the local counsel engaged the prese ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r consideration, the assessee filed return declaring a total income of Rs. 8,73,380/-. The case was selected under scrutiny for the reason of 'abnormal increase in cash deposits during demonetisation period as compared to pre-demonetisation period'. The AO issued notices u/s 143(2)/142(1) which were complied by assessee from time to time. The assessee furnished copies of Computation of total income, Bank statements, Cash-book, P&L A/c, Balance-Sheet, Audit Report, etc. to AO (Para 5 of assessment-order). While conducting proceeding, the AO observed that the assessee made cash-deposits of Rs. 49,00,000/- in a bank a/c during demonetisation. When the AO show-caused assessee to explain the source of deposit, the assessee submitted that he was engaged in jewellery business as proprietor of M/s Ambalika Jewellers, Bhopal. The assessee also submitted that he was having sufficient cash-balance in books of business which was deposited in bank a/c due to declaration of demonetisation. The AO, however, passed following order and treated the impugned deposit as unexplained investment u/s 69 and made addition: "7. On perusal of material available on record, it is seen that on 08/03/2017, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 49,00,000/- which was deposited in the form of specified bank notes in his bank account number 03466238626 maintained with SBI, Chowk Bazar, Bhopal. Further, it is also noteworthy to mention here that reasons for the source of cash deposited in aforesaid bank account as submitted by assessee is not tenable as it is devoid of any merits and generally not depositing cash in his current account and subsequently keeping so huge cash in hand is quite suggestive of tax evasion which has also been duly applied in this case. Thus, the above sum of Rs. 49,00,000/- is added to the total income of the assessee as 'unexplained investment' u/s 69 of the Act." 5. Aggrieved by AO's order, the assessee carried matter in first-appeal. During first-appeal, the assessee made a detailed submission before CIT(A). The CIT(A), however, rejected assessee's submission and upheld AO's action. Now, the assessee has come in next appeal before us assailing the orders of lower-authorities. 6. Ld. AR for assessee firstly narrated following facts with reference to documentary evidences filed in Paper-Book: (i) That the assessee is engaged in business of gold and silver in proprietorship concern nam ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lso placed at Page No. 11 to 15 of Paper-Book-III. The assessee claimed input credit of tax paid on purchase and also paid output VAT on sales from time to time and declared the same in VAT return. Thereafter, the assessee made payment of Rs. 47,35,262/- to M/s Ambika Jewellers on 08.03.2017 through banking channel. The payment so made was debited in assessee's bank a/c and credited in father's bank a/c. (ii) Subsequently, the assessee's father made a gift of Rs. 58,60,000/- on 09.03.2017 to assessee. The bank statement of father is partly extracted in AO's order (re-produced above) and partly not extracted but from the available entries therein, it is clearly discernible that assessee's father was having much higher funds from different sources (of course, including the payment of Rs. 47,35,262/- made by assessee) for making gift to assessee. Ld. AR submitted that a gift deed was also executed by father which was duly filed to AO, copy at Page 107 of Paper-Book-I. In this gift-deed, assessee's father has made a clear-cut declaration that he made impugned gift to assessee due to love and affection. Ld. AR submitted that the AO has not made any addition in assessee's hands qua the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that it had received advance money from walk in customers for sale of jewellery over the counter and the amount so received was duly recorded in the books of account. The said amount alongwith other cash balance available with the assessee was deposited into the bank account after announcement of demonetization by the Government of India. He also submitted that the assessee has raised sale bills against the said advances in the name of respective customers. Since the transaction was less than Rs. 2.00 lakhs, it was stated that the assessee did not collect complete details of the customers. Thus, it is seen that the advance amount collected from customers, the sales bill raised against them etc., have been duly recorded in the books of account. The impugned deposits have been made from cash balance available with books of account. I also notice that the Assessing Officer has not rejected the books of account. When cash deposits have been made from the cash balance available in the books of account, in my view, there is no question of treating the said deposits as unexplained cash deposit as opined by the Assessing Officer. 5. The Ld A.R relied on certain case laws which are releva ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... impugned addition made by AO has resulted in double taxation which is not sustainable. To support his stand, Ld. AR relied upon ACIT Vs. Dewas Soya Ltd. [IT Appeal No. 336/Ind/2012], a decision given by ITAT, Indore holding as under: "6.20 The claim of the appellant that such addition resulted into double taxation of the same income in the same year is also acceptable because on one hand cost of the sales has been taxed (after deducting gross profit from same price ultimately credited to profit & loss account) and on the other hand amounts received from above parties has also been added u/s. 68 of the Act. 6.21 This view has been held by the Hon'ble Supreme Court in the case of CIT vs Devi Prasad Vishwnath Prasad (1969) 72ITR194 (SC) that "It is for the assessee to prove that even if the cash credit represents income, it is income from a source, which has already been taxed". The assessee has already offered the sales for taxation hence the onus has been discharged by it and the same income cannot be taxed again." 11. Per contra, Ld. DR for revenue made following submissions to oppose the submissions of Ld. AR: (i) Each case has its own facts, therefore the decisions re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... which was claimed as input credit. Further, the assessee paid VAT on sale of such gold. The impugned purchase transaction of gold from father and subsequent sale thereof were duly informed to VAT authorities in VAT return and the same were accepted. Then, the assessee made payment of purchase price of Rs. 47,35,262/- to his father through banking channel and not in cash. It is subsequent to completion of purchase transaction in all respect that the assessee's father made a gift of Rs. 58,60,000/- to assessee and that too from the funds available to him from various sources (including the payment received from assessee). Notably, the gift of Rs. 58,60,000/- made by father far exceeds the purchase price of Rs. 47,35,262/- and has been made out of funds generated from various sources. The gift was made due to love and affection and a gift-deed executed by father was also filed to AO and the same is a part of Paper-Book as well. Therefore, the assessee is very correct in claiming that the gift transaction is nothing to do with purchase transaction and the two transactions are altogether independent of each other. The AO has made a wrong notion that there is a circular transaction by w ..... X X X X Extracts X X X X X X X X Extracts X X X X
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