THE ITO, WARD-2(1)(4), AHMEDABAD vs. M/S. MANAN MOTORS PVT. LTD, AHMEDABAD

This is an appeal filed by the Revenue against the order dated 09.03.2018 passed by the CIT(A)-2, Ahmedabad for the Assessment Year 2014-15.

The ground of appeal are as under:

The assessee is engaged in the business of trading in vehicle and running service station. The assessee filed its return of income on 08.11.2014 declaring total income as loss of Rs.26,58,254/-. The Assessing Officer made assessment under Section 143(3) read with Section 144 of the Income Tax Act, 1961 thereby making addition of Rs.1,72,68,014/- towards unexplained cash credit under Section 68 and Page 2 of 3 addition of Rs.28,33,988/- which was received by the assessee under the head income from “other sources”.

Being aggrieved by the assessment order the assessee filed appeal before the CIT(A). The CIT(A) partly allowed the appeal of the assessee.

During the course of hearing none appeared on behalf of the assessee despite giving notices and there is no fresh address filed by the assessee company before the Registry. Therefore, we are proceeding on the basis of submissions made by the assessee before the Assessing Officer as well as before the CIT(A)

The Ld. DR submitted that the CIT(A) erred in deleting the addition of Rs.1,72,68,014/- under Section 68 of the Act as the assessee has not given any evidences during the remand proceedings in respect of source of such cash deposit. Ld. DR further submitted that the said remained unproved and still the CIT(A) has deleted the said addition which is contrary to the provisions of Section 68 of the Act.

We have heard the Ld. DR and perused all the relevant material available on record. It is pertinent to note that before the CIT(A) the assessee has filed relevant bank statement of the donor and various cheques issued for the assessee company against immediate cash deposit. Cheque issued by Manan Auto Link Pvt. Ltd. to the assessee is not cash deposit per se as the assessee has taken amount from Manan Auto Link which is an impendent assessee. It was in respect of its regular cash available either in the form of cash received against vehicle sale and services and or cash withdrawal from Bank account and looking to the nature of business it is a regular/normal feature in the normal course of business without depositing such cash in the Bank Account of the company Manan Auto Link. The Assessing Officer during the remand proceedings has categorically observed that the relevant bank statement of the donor and the various cheques issued for the assessee company was there on record but the Assessing Officer has not taken its cognisance in its true spirit and simplicitor observed that the source of the cash deposit remains unproved. Thus, the CIT(A) has rightly deleted this addition as the assessee has established the source of the cash deposit which is from the company M/s. Manan Auto Link Pvt. Ltd. and the audited accounts of the said company was filed before the CIT(A). The order of the Page 3 of 3 CIT(A) is detailed order and there is no need to interfere with the same. Appeal is thus dismissed.

In the result, appeal of the Revenue is dismissed