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TMI Blog2025 (3) TMI 1116X X X X Extracts X X X X X X X X Extracts X X X X ..... unts were sourced out of earlier withdrawals made by the assessee from his bank account. Accordingly, since opening cash balance was sourced out of withdrawals made from the assessee's bank accounts and since there was no specific allegation that the amount was not available with the assessee for re-depositing, the opening cash balance cannot be added as income of the assessee u/s 69A of the Act. Addition u/s 69A - HELD THAT:- Since there is no specific allegation that the assessee had utilized the cash withdrawals elsewhere, in our view, there is no reason for the Assessing Officer to make addition u/s 69A of the Act. On going through the facts of the instant case, we observe that no specific observations were made by the AO while making the addition that the assessee had utilized the cash withdrawals elsewhere and further, the Assessing Officer has not pointed out as to why the cash withdrawn by the assessee from his bank account was not available with the assessee for re-deposit. Accordingly, keeping in view the assessee's facts, the addition is directed to be deleted. Addition received by the assessee from sale of cars - HELD THAT:- Sale of Renault Fluence Car and Santro C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... any etc. were furnished, and that there is no doubt that such sale of shares were made by the assessee, in lieu of cash - HELD THAT:- We are of the considered view that the assessee has failed to furnish the creditworthiness of M/s. Fincruise Services Pvt. Ltd. and there is nothing on record to show that M/s. Fincruise Services Pvt. Ltd. paid an amount of Rs. 49,99,990/- to the assessee in cash. Assessee despite being given several opportunities, did not produce cash book of the purchaser company to show separate cash payment. Further, in absence of cash book of M/s. Fincruise Services Pvt. Ltd. it is also not possible to ascertain whether the purchaser company had availability of cash at the relevant time to make such share purchase in cash, as stated by the assessee. Accordingly, keeping in view the fact of assessee's case, we find no infirmity in the order of CIT(A) so as to call for any interference. X X X X Extracts X X X X X X X X Extracts X X X X ..... ant evidences in the form of confirmation and audited accounts of the purchasers were furnished. Addition made by wrongly invoking section 69A of the Act without proper inquiry with the purchasers of shares sold by appellant held since long being patently wrong ought to be deleted. It be deleted now. 6. The ld CIT(A) [NFAC] grievously erred both in la wand on facts in not properly considering the detailed submission on each of the grounds of appeal before him and not appreciating the facts as well as legal decisions cited before him as regards erroneous order. It be so held now and additions made to the extent sustained by ld CIT(A) [NFAC] be directed to be deleted. 7. Without prejudice to the above, the ld CIT(A) also erred in not considering that the additions of Rs. 61,01,524/- were already covered by withdrawals and being duplication ought to be deleted. It be so held now. 8. The ld CIT(A) [NFAC] ought to have accepted the various grounds of appeal by allowing them in toto. 9. The appellant craves leave to add, alter, modify or delete any of the grounds at the time of hearing." 3. At the outset, we observe that the appeal is time barred by 20 days. The delay of 20 days ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ening balance the appellant argued that he is not liable to maintain books of account. Till AY 2016- 17 the appellant was earning less than Rs. 3 lakhs per annum. He could not produce any documentary evidence to prove the source from where cash of Rs. 88,64,304 was accumulated as opening balance. The appellant by his own admission had entered into real estate venture during AY 2017-18 and was liable to keep books of accounts even though he chose to file ITR-1. The cash book shows transactions related to business activity and the appellant had made withdrawals for this purpose. But there is nothing to prove opening cash balance. Hence it is held that the addition of Rs. 88,64,304 under section 69A is valid and correct. As a result, ground no 1 is dismissed." 6. The assessee is in appeal before us against the aforesaid addition confirmed by Ld. CIT(A). 7. Before us, the Counsel for the assessee submitted that the assessee is a salaried person and is not required to maintain any cash book. However, only with a view to cooperate with the Department, the assessee had prepared a cash book and submitted the same before the Assessing Officer. The Counsel for the assessee submitted that i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts held with various banks. The Assessing Officer has not pointed out any source of income of the assessee, apart from salary income and there is no allegation that the assessee had earned any unexplained income outside the books of accounts. Further, there is no allegation by the Department that the cash so withdrawn by the assessee from his bank accounts, was not available with the assessee for being re-deposited in his bank account. It is a well settled principle that if the Assessing Officer has not brought on record any evidence to show that the cash withdrawals made by the assessee has been used elsewhere and that the same were not available with the assessee for re-depositing, then it has to be presumed that the subsequent re-deposit in the bank accounts were sourced out of earlier withdrawals made by the assessee from his bank account. Accordingly, considering the assessee's facts, in our considered view, since opening cash balance was sourced out of withdrawals made from the assessee's bank accounts and since there was no specific allegation that the amount was not available with the assessee for re-depositing, the opening cash balance of Rs. 88,64,304/- cannot be added as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under consideration. The assessee had sold "Renault Fluence Car" on 15.07.2016 for a sum of Rs. 10 lakhs, for which sale note and delivery note were also furnished. Further, the assessee had also given identity of the purchaser, by filing his Voter ID Card and also furnished confirmation of the purchaser. Further, the assessee had also sold "Santro" car on 15.07.2016 for a sum of Rs. 2,00,000/- to Shri Dilip Arjunbhai Rathod and the assessee had furnished similar details with regard to such sale viz. sale note, delivery note, address of the purchaser, Aadhar Card of the purchaser and confirmation from the purchaser of having paid Rs. 2,00,000/- for purchase of Santro car. 16. However, the Assessing Officer added the aforesaid amount of sale consideration on sale of Renault Fluence Car and Santro Car by holding that though notices were issued to both the purchasing parties, these parties failed to respond to notices issued by the Assessing Officer under Section 133(6) of the Act and therefore, the assessee has not been able to establish the genuineness of sale consideration of Rs. 12,00,000/-, which was therefore treated as unaccounted income of the assessee. Further, the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to show that the appellant received Rs. 36,10,000 as cash from car sales. Hence the addition is sustained and grounds 4 and 5 are dismissed." 18. The assessee is in appeal before us against the aforesaid order passed by Ld. CIT(A). 19. On going through the facts of the instant case, we observe that so far as sale of Renault Fluence Car and Santro Cars are concerned, complete details with regards to the purchaser were furnished by the assessee, during the course of assessment proceedings and the only reason why the addition was made in the hands of the assessee was only on the ground that the purchaser failed to respond to notices issued by the Income Tax Department. However, no other adverse inference / observations was made by the Assessing Officer / CIT(A) while confirming the addition in the hands of the assessee. Accordingly, looking into the assessee's set of facts, in our considered view addition of Rs. 10,00,000/- (on sale of Fluence car) and Rs. 2,00,000/- (Santro car) are liable to be deleted. 20. However, so far as sale of Mercedes Benz car is concerned, the assessee has not brought anything on record to controvert the findings made by the Assessing Officer / CIT(A) wh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 7. Ground no 6 is against addition of Rs. 1,10,00,000 as unexplained cash receipt. The appellant entered into an MOU to develop a land parcel. The assessee claimed that he received Rs. 1,10,00,000 in cash from Shri. Prabhatsingh Attaji Thakpre as part of the MoU. However, the appellant could neither produce proof of cash receipt nor the payer in person as requested by the AO. The AO also found that Thakor Pratapsingh Aataji (PAN-ACRPT8500B) has not filed any return of income and the creditworthiness of the cash creditor is not proved. The appellant argued that merely because the other party was not filing Return it could not be concluded that the receipt from him was not explained and was appellants unexplained income and it is not the onus of the assessee to explain the source of source. The appellant relied on the judgment of Supreme Court in the case of CIT vs Orissa Corporation 159 ITR 78. In this case Rs. 1,50,000 was given by individuals who were income tax filers and hence not squarely applicable to appellant's case. However, in a later decision of Supreme Court in the case of NRA Iron & Steel Pvt. Ltd, 2019 SCC OnLine SC 311, it was held that, the authorities below have ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... how the creditworthiness of Shri Prabhatsingh Attaji Thakore to advance such substantial amount to the assessee. Accordingly, we find no infirmity in the order of Ld. CIT(A) so as to call for any interference. 26. In the result, Ground No. 4 of the assesee's appeal is dismissed. Ground No. 5: Ld. CIT(A) erred in confirming addition of Rs. 49,99,900/- in respect of sale of shares under Section 69A of the Act. 27. The brief facts in relation to this ground of appeal are that during the course of assessment, the Assessing Officer observed that assessee had sold 4,99,900 shares of Balsam Enterprise Pvt. Ltd. to M/s. Fincruise Credit Services Pvt. Ltd. Notably at the time of sale of such shares, the assessee was the main Director of both the companies and was also the Chairman of Fincruise Credit Services Pvt. Ltd. Regarding, the availability of cash with M/s. Fincruise Credit Services Pvt. Ltd., the assessee was requested to furnish copy of cash book as proof of source of cash payment, towards the aforesaid purchase transaction. However, the assessee failed to provide any supporting documents and accordingly, the Assessing Officer was of the view that source of cash receipt of Rs. 49 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y M/s. Fincruise Credit Services Pvt. Ltd. towards cash payment on purchase of shares from the assessee. Further, the Counsel for the assessee submitted that all evidences regarding transaction of shares viz. Shares transfer Form, audited accounts of the purchaser company etc. were furnished, and that there is no doubt that such sale of shares were made by the assessee, in lieu of cash of Rs. 49,99,990/-. Therefore, this addition is liable to be deleted. 30. On going through the facts of the instant case, we are of the considered view that the assessee has failed to furnish the creditworthiness of M/s. Fincruise Services Pvt. Ltd. and there is nothing on record to show that M/s. Fincruise Services Pvt. Ltd. paid an amount of Rs. 49,99,990/- to the assessee in cash. The assessee despite being given several opportunities, did not produce cash book of the purchaser company to show separate cash payment of Rs. 49,99,990/-. Further, in absence of cash book of M/s. Fincruise Services Pvt. Ltd. it is also not possible to ascertain whether the purchaser company had availability of cash at the relevant time to make such share purchase in cash, as stated by the assessee. Accordingly, keepin ..... 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