MINESH C. PATEL,MUMBAI vs. INCOME TAX OFFICER 17(2)(3), MUMBAI

This is an appeal filed by the assessee against the order of CIT(A)- 28, Mumbai dated 24/07/2017 for A.Y.2010-11 in the matter of order passed u/s.143(3) of the I.T. Act, 1961. 2. In this appeal, assessee has challenged service of notice u/s.143(2), accordingly it was contended that assessment framed without service of notice required to be quest.

Rival contentions have been heard and record perused.

Ld. AO has made an addition of Rs. 22,73,300/- u/s 68 of the Act on account of cash deposits being treated as unexplained. However, Ld. CIT(A) confirmed the said addition u/s 69A of the Act.

We have considered rival contentions and carefully gone through the orders of the authorities below. From the record we found that the assessee has withdrawn Rs. 47,00,000/- during the year and out of the same Rs. 22,73,300/- was redeposited to bank. Source of such deposits was only out of cash withdrawals. It was explained that reason for again deposit of cash is due to postponement of marriage of assessee’s daughter. Since the marriage date of assessee’s daughter was postponed, he redeposited the cash withdrawn from his bank account.

Since the assessee was having sufficient cash available in hand as on the date of deposit out of withdrawal from the very same bank account, there is no justification for making the addition in respect of cash again deposited in the very same bank account source of which was duly explained i.e., out of withdrawals from the very same bank account. From the record we found that it is an undisputed fact at para 3.5 of the Assessment Order where Chart of Cash withdrawal and Deposits are reproduced by learned AO. Accordingly, we direct the AO to delete the addition so made.

From the record, we found that assessee has received Rs. 4,94,500/- on following account:- Name of the Person Amount (In Rs.) Nature UTI Bond 2,00,000 Amount received as Legal Heir of Mother Jagannath S Gawali 34,000 Loan Repaid (Sunil Gawali) Suresh S Kumbhar 67,000 Loan Repaid Shahaji K Bhosale 93,500 Loan Repaid Amol A Bhosale 40,000 Loan Repaid Kiran Patil 60,000 Loan Repaid

For Rs.2,00,000/-, assessee had submitted during remand proceeding that he has received Rs. 2,00,000/- in the capacity as Legal Heir of his Mother on maturity of UTI Bond. Copy of application made to UTI seeking to provide him with relevant details, Death Certificate of her mother and Cheque received from Axis Bank on account of maturity of UTI bond were submitted before the lower authorities. We also found that Shri Minesh C. Patel the AO has accepted the above fact in his remand report at Pg. 83 of PB. Since, details are verifiable, no addition can be made on such account, accordingly we direct the AO to delete the said addition. With regard to addition of balance amount Rs.2,94,500/-, we found that earlier assessee was doing business and was a partner in M/s.Chemfert Traders and M/s Yogini Fertilizers. Said firms also carried activity at Jalgaon, Solapur and Satara. The said persons were employees of the said firms. During that time, loans were given to them. Assessee has received back the loan given through cheques during the impugned year. In support of its claim assessee has furnished following documentary evidences before the lower authorities. a. Confirmation of the Parties b. Copy of PAN c. Copy of Affirmation received from all panics d. Copy of Bank Statement reflecting the repayment 11. In view of the above, we observe that assessee has proved the identity, genuineness and creditwrothiness of all the parties. Accordingly, no addition is warranted. We direct the AO to delete the addition so made. 12. Since we have already decided the issue on merit, we are not going in the legal ground raised by the assessee.