RAJESH AGARWAL,KOLKATA vs. ITO, WARD 25(3),, KOLKATA

₹2,47,261 on account of low gross profit,

₹25,000 on account of donation, and 3. ₹3,00,000 on account of difference in closing bank balance (treated as unexplained cash credit). Accordingly, the total income was assessed at a higher figure. 3. The assessee preferred an appeal before the learned CIT(A), who sustained the order of the Assessing Officer, granting partial relief. The assessee is now in further appeal before the Tribunal. 4. At the time of hearing, the learned Authorised Representative (AR) submitted that grounds No. 1 and 2 are not pressed. Therefore, the only issue surviving for adjudication is with respect to the addition of ₹ 3,00,000/-, being the difference between the bank balance as per books and as per bank statement. 5. The learned AR explained that as per the books of accounts, the closing bank balance in ING Vysya Bank Ltd. was ₹25,90,866.29, whereas as per the bank statement, the closing balance was ₹22,90,866.29, resulting in a difference of ₹ 3,00,000/-. It was submitted that the difference was only due to a cheque of ₹3,00,000/- received from Deepak Traders vide cheque No. 189773 dated 28.03.2015, which was deposited by the assessee before 31.03.2015 but was cleared only on 04.04.2015. The assessee also furnished a bank reconciliation statement and copy of the account of Deepak Traders to substantiate the claim that the said difference arose merely due to timing difference in cheque clearance and not due to any unexplained cash credit. 6. The learned Departmental Representative (DR) fairly did not raise any serious objection but submitted that at the time of assessment, the 3 Rajesh Agarwal assessee could not properly substantiate its claim before the Assessing Officer. Therefore, it was added to the income of the assessee. 7. We have considered the rival submissions and perused the material available on record. It is an undisputed fact that the difference of ₹ 3,00,000/- between the bank balance as per books and as per bank statement was on account of a cheque received from Deepak Traders dated 28.03.2015, which was deposited before the end of the financial year but cleared by the bank on 04.04.2015. This explains the timing difference and fully reconciles the variation between the two balances. The reconciliation statement and supporting evidence produced by the assessee substantiate that there was no unexplained cash credit or concealed income on the part of assessee. 8. Accordingly, we find no justification for sustaining the addition of ₹ 3,00,000/-. The same is, therefore, directed to be deleted. 9. The appeal of the assessee is allowed and the Assessing Officer is directed to delete the addition of ₹ 3,00,000/- made on account of difference in bank balance as made in the case of assessee. 10. In terms of the above, appeal of the assessee is allowed.

CIT(DR)