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Income Tax Appellate Tribunal, DELHI BENCH: ‘C’ NEW DELHI
Before: SHRI G. D. AGRAWAL & MS SUCHITRA KAMBLE
ORDER PER SUCHITRA KAMBLE, JM
This appeal is filed by the assessee against the order dated 11/03/2016 passed by the CIT(A)-28, New Delhi for Assessment Year 2010-11.
The grounds of appeal
are as under:-
1. The CIT(A) has erred in confirming the addition of Rs. 2,50,000/- on account of cash deposited in bank ignoring the cash drawings plus the Credit Card drawings and other factors.
2. That the appellant seeks leave to add to, alter, amend, abandon or substitute any of the above grounds at the time of hearing of appeal.”
3. The assessee is a Vice President in M/s GE Capital Services India and derives salary income and also derives rental income from house property, STCG, LTCG on sale of shares and interest income from FDRs and savings bank accounts. The return of income was electronically filed on 30.07.2010 declaring income of Rs.1,33,47,240/-. The return was processed u/s 143(1) of the Income Tax Act, 1961 on 09.05.2011. The case was selected for scrutiny under CASS and initial statutory notice u/s 143(2) of the Income Tax Act, 1961 (‘the Act’) on 22.9.2015 was issued and served upon the assessee. The C.A. and Authorized Representative of the assessee attended the assessment proceedings from time to time and filed the details which were examined by the Assessing Officer. The Assessing Officer made various additions including the addition of Rs.2,50,000/- in respect of unexplained cash deposits.
Being aggrieved by the assessment order, the assessee filed appeal before the CIT(A) and the CIT(A) partly allowed the appeal of the assessee.
The Ld. AR submitted that the CIT(A) erred in confirming the addition of Rs.2,50,000/- on account of cash deposited in bank ignoring the cash drawings plus credit card drawings for which documentary evidence was produced before the Assessing Officer. The Ld. AR demonstrated from the paper book that the details of cash withdrawals was before the Assessing Officer which was not taken into account by the Assessing Officer as well as by the CIT(A). The Ld. AR also submitted the Cash Flow Statement for F.Y. 2009- 10 i.e. A.Y. 2010-11. The Ld. AR further submitted that the assessee being salaried employee in the normal circumstances does not require preparing and maintaining the statement of affairs. Further the assessee being a Sr. Executive was required to travel extensively and thus could not get them prepared in a short time. The assessee is a single man and is having a house and car perquisites besides the usual facility of phone etc. The Ld. AR further submitted that being an Executive, he meets most of his personal expenses 2 A.Y. 2010-11 Mr.Sathappan Visvanathan vs. ACIT through credit cards. His drawings through credit cards other than cash withdrawals was to the extent of Rs.10,38,356/-, which is sufficiently large for his usual expenses. The assessee maintains a reasonably large cash balance as he is required to undertake extensive travel and may require it, the details of which has been given to the revenue authorities during the Assessment Proceedings and before the CIT(A). Thus the Ld. AR submitted the Assessing Officer as well as the CIT(A) was not correct in making addition as unexplained cash deposits.
The Ld. DR relied upon the assessment order and order of the Ld.CIT(A).
We have heard both the parties and perused all the material available on record. The finding of the CIT(A) that withdrawals were only nominal does not appears to be correct after going through the evidences produced before the Assessing Officer as well as before the CIT(A). In fact, the assessee in a year has withdrawn more than Rs.10 lakhs. This crucial factor has been overlooked by the Assessing Officer as well as by the CIT(A). The details filed by assessee during the assessment proceedings and before the CIT(A) itself speaks that the cash deposit of Rs.2,50,000/- is from the said cash withdrawals which was made for Travelling expenses of the assessee for his official duty as an employee of M/s GE Capital Services India. Therefore, the CIT(A) as well as the Assessing Officer were not correct in making such additions. Thus, appeal of the assessee is allowed.