ITO, WARD-1(3)(2),, VADODARA vs. SHRI KAMAL KUMAR AGARWAL,, VADODARA

Facts of the case are that during the course of assessment proceedings, as per AIR information, the Assessing Officer noted that the assesses has made cash deposits amounting to Rs.40,87,475/- on various dates during the F.Y. 2009-10 in a Saving Bank Account No. 312602010012603 in the name of the assessee with union Bank of India, Sayajigunj Branch, Baroda. Further, on verification of bank statement, it is seen that the total cash/credit transaction during the F.Y. 2009-10 are amounting to Rs.46,46,755/- out of which cash deposits are of Rs.40,84,475/-. The remaining amount of Rs.5,59,280/- is credited by the way of cheques/transfers. The assessee has not disclosed this bank account in his books of account and return of income for A.Y. 2010-11. Further, on being asked to submit the copy of all banks account along with Bank statement for the F.Y. 2009-10, the assesses has not submitted this bank account details at the time of assessment proceedings. Thereafter, information was called for u/s. 133(6) of the Act from the bank. In response, the bank has provided the statement of the above bank account for the period 01.04.2009 to 31.03.2010. As the assessee has failed to discharge the onus of explaining the source and genuineness of the cash/credit deposits amounting to Rs. 46,46,755/- in the saving Bank Account No. 312602010012603 in the name of the assessee with Union Bank of India, Sayajigunj Branch, Baroda. The Assessing Officer treated the same as unexplained and undisclosed cash/credit deposits as income of the assessee and add Rs.46,46,755/- to the total income of the assessee.

Now Department is before us.

We have gone through the relevant record in the impugned order. In this case, assessee is engaged in the business of manufacturing and trading of re- processed plastic granules, plastic bags and other plastic packing products. It is noticed that total cash/credit transaction during the Financial Year 2009-10 are amounting to Rs. 46,46,755/- out of which cash deposits are of Rs. 40,84,475/- and remaining amount of Rs. 5,59,280/- is credited by way of cheques/transfers and assessee has not disclosed this bank account in his books of account.

In support of its contention filed detailed paper book containing P & L account sales register with invoice and purchase register invoice. And ld. A.R. cited an order of Gujarat High Court in the matter of PR. CIT Vs. Indrajeet Zandusing Tomar in Tax Appeal No. 908 of 2015 wherein question before the Hon’ble High Court: (A) "Whether on the facts and circumstances of the case and in law, the ITAT was justified in accepting the amount of Rs.22,58,223/- which was peak credit in two undisclosed bank accounts, as the undisclosed income ignoring the facts that the undisclosed bank account had total credit entries of Rs.2,46,75,333/- and the source of the same was never substantiated / proved by the assessee either at the assessment proceedings or appellate proceedings?"

And Hon’ble High Court given relief similar circumstances by holding as under:

Above case is identical to present case where assessee purchased plastic of Rs. 40,37,885/- from unregistered dealer and hawker who do not have any VAT and PAN no. therefore no bills were given to the parties but he submitted names of the persons from whom plastic was purchased and in support of its contention, assessee produced purchase register before the lower authorities as well as invoices. Further, the cash collected from parties to whom goods have been sold and same was deposited in the bank and whatever amount was transacted in the bank was for the purpose of business. Assessee has also prepared Profit and Loss account where profit of Rs. 3,98,746/- is shown. In our considered opinion, ld. CIT(A) has rightly restricted the addition by

In the result, the appeal filed by the Revenue is dismissed.