THE ITO, WARD-6(2),, AHMEDABAD vs. SHRI SHRENIK KIRITLAL SHETH,, AHMEDABAD

This appeal by the Revenue is preferred against the order of the Ld. CIT(A)-II, Ahmedabad dated 11.12.2013 pertaining to A.Y. 2008-09.

The assessee filed the return of income on 15.05.2008 showing total income of Rs. 2,34,890/-. The return was selected for scrutiny assessment and accordingly statutory notices were issued and served upon the assessee. On the basis of the AIR information, the assessee was asked to explain the source of investment of Rs. 1.80 crores in purchase of immovable property with supporting evidences and source of cash deposits of Rs. 14.91 lacs in Cosmos Co-op. Bank. On receiving no plausible reply, the A.O. proceeded by completing the assessment on the basis of material available on record.

On verification of the details submitted by Sub-Registrar, the A.O. found that the assessee has made purchase of immovable property worth Rs. 45 lacs only. Considering the clarification of the Sub-Registrar, the A.O. treated Rs. 45 lacs as unexplained investment u/s. 69 of the Act.

Proceeding further, on receiving no plausible reply relating to the source of cash deposits of Rs. 14.91 lacs in Cosmos Co-op. Bank, the A.O. treated the entire amount as income from undisclosed sources and added the same to the total income of the assessee u/s. 68 of the Act.

A perusal of the record shows that the assessee has taken Rs. 36,00,000/- from Cosmos Co-op. Bank and the balance Rs. 9,00,000/- was found to be duly recorded in the cash book and bank account of the assessee. Since the source of investment in the property of Rs. 45 lacs is found to be explained and duly recorded in the books of accounts, we do not find any reason to interfere with the findings of the ld. CIT(A). Ground no. 1 is accordingly dismissed.

The second grievance relates to the deletion of the addition on account of cash found to be deposited in the bank account amounting to Rs. 14.91 lacs.

Before the ld. CIT(A), the assessee explained that is deriving major business receipts in cash from SIM card recharges. It was explained that in this line of business, the mobile user always pays cash for recharges of SIM card. It was further explained that the banks started debiting bank charges on account of cash deposit exceeding Rs. 1,00,000/- in current account and to avoid such bank charges, the assessee started depositing cash in his Savings Bank account and since there was deposit of more than Rs. 10 lacs in cash in the Savings Bank account. It was reflected in the AIR information.

We find that in A.O’s presence the entries were verified and found correct. Therefore, no interference is called for. Ground no. 2 is accordingly dismissed.

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