ASHISH TILAKCHANDRA BHATT,ANAND vs. THE ITO, WARD-1, ANAND

Without prejudice to the above ground, the Id NFAC/ CIT(A) also erred both in law and on facts in not adjudicating ground No: 2 & 3 so as to allow Indexed Cost in respect of property sold while computing 2

Without prejudice to above grounds , the Id NFAC/ CIT(A) further grievously erred both in law and on facts in confirming the addition of Rs.18,18,000/- being amounts deposited in bank account ignoring the legal effect of the case of appellant and facts that there were withdrawals from very same bank account available for re-depositing the same. It be so held now and addition of Rs.18,18,000/- be deleted now.

The Id NFAC/CIT(A) further erred both in law and on facts in confirming addition of Rs.18,18,000/- on untenable grounds and not properly considering the binding judgments on the issue cited before him. It be so held now and addition of Rs.18,18,000/- be directed to be deleted.]

The Id NFAC/CIT(A) also erred in la wand on facts in not properly considering appellants submissions on the remand report of the Id AO and the evidences in the form of cash flow statement in which even withdrawals from very same bank account were shown for which , no specific defect was pointed out and no valid rebuttal made. The addition thus confirmed is unjustified and deserves to be deleted. It be deleted now.

The Id CIT(Appeals) erred in law and on facts in not properly considering the appellants grounds and detailed submissions in making erroneous conclusion and presumptions that cash deposited / credits in bank account was unexplained to be treated as deemed income It be so held now and addition made be deleted.

The Id NFAC/CIT(A) ought to have allowed the appeal of the appellant in toto and deleted the additions. It be deleted now.”

A perusal of the above grounds would reveal that there are only two effective grounds taken by the assessee raising the following two issues, in this appeal.

The second issue raised by the ld.counsel for the assessee is that the assessee had made total deposit of Rs.1,86,000/- in the bank account during the assessment year under consideration. He referring to the page no.86 of the PB, which is a chart showing the withdrawals and deposits in the bank account of the assessee, has demonstrated that there were corresponding withdrawals also against certain cash deposits. He, therefore, has submitted that the AO was not justified in making addition of the entire cash deposits in the bank account of the assessee.

After going through the said chart, I find that there were substantial cash withdrawals also from the bank account of the assessee. The said chart is also reproduced hereunder:

A perusal of the above chart would reveal that there were substantial cash withdrawals also before the deposits in the bank account. If we ignore the minor withdrawals, still I find that there was a cash withdrawal of Rs.65,000/- on 19.4.2011 and further of Rs.1,00,000/- on 3.5.2011. There was deposit of Rs.50,000/- on 20.5.2011 and Rs.15,000/- on 23.5.2011. The aforesaid two amounts deposited by the assessee within the short span of time can well be considered out of the higher cash withdrawals made by the assessee. Further, I do not find any reason to give any relief to the assessee in respect of the amounts deposited on 23.5.2011 of Rs.2,15,000/- and Rs.1,00,000/- and further deposit on Rs.9.9.2011 of Rs.3,20,000/-. However, I find that on 15.9.2011 the assessee had withdrawn an amount of Rs.2,90,000/- and had deposited Rs.3,00,000/- on 19.9.2011. In my view, benefit of the said withdrawals to the extent of 50% of the amount withdrawn by the assessee in this respect will be reasonable. Therefore, out of Rs.3,00,000/-, the addition to the extent of Rs.1,60,000/- is confirmed.

Thereafter, there are cash withdrawals of Rs.3,00,000/- each on 21.9.2011 and 26.9.2011 and there is a corresponding deposit of Rs.5,00,000/- on 3.10.2011. Considering the short interval between the withdrawals and deposits no addition on this amount is warranted.

Similarly, there are cash withdrawals of Rs.2,00,000/- on 4.10.2011 and Rs.1,00,000/- on 23,12.2011, and there is a corresponding deposit of Rs.50,000/- on 2.01.2012. In my view, the relief to the assessee in respect of the said deposit of Rs.50,000/- should be given. However, the ld.AR could not prove the source of the amount of deposit of Rs.10,000/- on 6.1.2012 and Rs.50,000/- on 6.3.2012, and I do not find any justification of the source of the 6

Addition of the remaining deposits, apparently found to be from withdrawals, is hereby deleted.

With the above observations, the appeal of the assessee is hereby partly allowed.

In the result, the appeal of the assessee stands partly allowed.