VIJAY KUMAR AGARWAL,MADANGANJ- KISHANGARH vs. DCIT CENTRAL CIRCLE AJMER, AJMER

vkns'k@ ORDER PER: RATHOD KAMLESH JAYANTBHAI, A.M. This appeal is filed by the assessee aggrieved from the order of the Commissioner of Income Tax (Appeals), Jaipur-5 [Here in after referred as (CIT(A))] for the assessment year 2019-20 dated 23.11.2023, which in turn arises from the order passed by the ACIT, Central Circle, Ajmer passed under Section 143(3) r.w.s 153A of the Income tax Act, 1961 (in short 'the Act') dated 26.04.2021.

Vijay Kumar Agarwal vs. DCIT 2. The assessee has taken following grounds in this appeal; “1. On the facts and in the circumstances of the case the CIT(A) has erred in confirming the addition of the amount of Rs. 10,15,000/- seized from the appellant at Jaipur Air-Port on 12th May, 2018 pertained to him.

2. That the ld. CIT(A) has erred on facts and in law in confirming the addition of a sum of Rs. 10,15,000/- as unexplained money of the appellant and application of the provision of section 69A r.w.s 115BBE of the Act.

3. The appellant keeps its right reserve to add, amend or withdraw any ground of appeal

before or at the time of hearing of the appeal.

4. All the ground of appeal are independent and without prejudice to each other.”

3. The fact as culled out from the records is that the assessee is engaged in the business of commission income as well as marble business. In the case of the assessee a warrant of authorization was issued u/s 132(1) of the I.T. Act, 1961 by Pr.

DIT(Inv.), Rajasthan, Jaipur and search and seizure operation was carried out on 12.05.2018 on assessee Shri Vijay Kumar Agarwal at Jaipur Airport, Jaipur which was concluded on 13.05.2018. The Pr. Commissioner of Income-tax, Udaipur vide his order u/s 127 bearing No. Pr. CIT/ITO(Tech)/UDR/2020-21/3354 dated 18.01.2021 had assigned the jurisdiction from ITO, Ward-1, Kishangarh to ACIT, Central Circle, Ajmer. The assessee has submitted return of income on 23.10.2019 declaring income of Rs.

Vijay Kumar Agarwal vs. DCIT Nil. A notice u/s 143(2) was issued on 23.09.2020 and the same was duly served upon the assessee by e-mail. A query letter along with notice u/s 142(1) was issued on 01.03.2021.

3.1 The income tax department intercepted the assessee with a cash of Rs. 10,15,000/-. Statement of Shri Vijay Kumar Agarwal were recorded u/s 131 of the IT. Act, 1961, wherein he accepted that the cash of Rs. 10,15,000/- in the beg, pertains to M/s Shri Ram Marble, Jorhat (Aasam) which is partnership firm wherein his younger brother’s wife Smt. Priti Agarwal and his wife Smt. Kiran Agarwal are the partners. He also submitted that the same has to be given to his brother Shri Banwari Lal Agarwal for pending payments to businessmen in Kishangarh. The cash of Rs. 15,000/- found in his purse was stated to be belongs to him. Shri Vijay Kumar Agarwal was unable to justify the source of cash and also unable to produce any evidence in support of cash found in his possession. Assessee, in support of his contention. The assessee has neither furnished the cash book of M/s Shri Ram Marble, Jorhat nor furnished its final accounts, copy of ITR, bank statement etc. on the basis of which it can be relied upon that the sources of Vijay Kumar Agarwal vs. DCIT above cash actually pertains to the above firm. Therefore, it is clear that Shri Vijay Kumar Agarwal is unable to prove the sources of cash of Rs. 10,15,000/- found from his possession during the course of search proceedings. Therefore, an addition of Rs. 10,15,000/- was made to the total income of the assessee by treating the same as unexplained money u/s 69A of the IT. Act, 1961 r.w.s 115BBE of the IT. Act, 1961.

4. Aggrieved from the order of the assessment, assessee preferred an appeal before the ld. CIT(A). Apropos to the grounds so raised the relevant finding of the ld. CIT(A) is reiterated here in below :

“4.2.8 Decision: The submission and the documents submitted by the appellant and the remand report submitted by the AO are considered and the facts of the case are discussed as below: (1) During the course of search proceedings, Shri Vijay Kumar Agarwal in his statements u/s 131 of the I.T. Act, 1961 accepted that the cast of Rs. 10,00,000/- in the bag pertains to M/s Shri Ram Marble, Jorhat (Aasam). This was a partnership Firm, in which, his younger Brother's wife Smt. Priti Agarwal and his wife Smt. Kiran Agarwal were the partners. In his statements Shri Vijay Kumar Agarwal had also submitted that the cash amount of Rs. 10,00,000/- pertains to M/s Shri Ram Marble and the same had to be given to his brother Shri Banwari Lal Agarwal for pending payments to businessmen in Kishangarh and the cash of Rs.15,000/- found in his purse belonged to him. (2) The AO in the assessment order had also mentioned that during the course of assessment proceedings, the assessee had been asked to explain the sources of the above cash with documentary evidences. In response to the same the assessee vide his submission dated 08.03.2021 had submitted that the cash belongs to M/s Shri Ram

Vijay Kumar Agarwal vs. DCIT Marble, Jorhat and in which wife of assessee was partner. The cash was brought here to purchase marble and it was duly recorded in the book in which his wife was partner and as such it cannot be taxed u/s 69A r.w.s. 115BBE of the I.T. Act, 1961.

(3) Shri Vijay Kumar Agarwal during the search proceedings submitted that the cash had to be given to his brother Shri Banwari Lal Agarwal for pending payments to businessmen in Kishangarh and during the course of assessment proceedings submitted that cash was brought here to purchase marble and it was duly recorded in the book in which his wife was partner.

On the basis of the above, it is clear that Shri Vijay Kumar Agarwal was hiding the facts of the case and telling a fabricated story that the cash pertained to M/s Shri Ram Marble, Jorhat.

(4) Shri Vijay Kumar Agarwal had neither explained the sources of the above cash with documentary evidences during the course of post search investigations nor during the course of assessment proceedings. Shri Vijay Kumar Agarwal had submitted that the cash belongs to M/s Shri Ram Marble, Jorhat, only to change the direction of the investigation and to safe himself from any litigation. His non co- operation has established his moto behind the fabricated story.

(5) Further, it is noticed that during the post search investigations, summons u/s 131 of the IT Act, 1961 were issued to Shri Vijay Kumar Agarwal by the DDIT (Inv.)-II. Jaipur, but he had not responded to the same. However, a written reply was received wherein he had again submitted that "Cash belong to M/s Shri Ram Marble Jorhat and, which has been seized from assessee. Cash belong to firm and was brought on their behalf. There is no purchase and sale from 01.04.2018 to till date and there is no cash transaction as such copy of cash book has not been kept."

On the basis of the above submission, it is clear that there was no purchase and sale from 01.04.2018 to till date of search and there was no cash transaction, hence copy of cash book had not been kept. But during the course of appellate proceedings, the appellant has submitted the copy of the cash book of M/s Shri Ram Marbles, Jorhat, and shown various transactions in cash.

On the basis of above, it is evident that the above cash book has been prepared only after the post search investigations and assessment proceedings. Shri Vijay Kumar Agarwal during the course of the post search investigations in compliance to summons u/s 131 of the IT Act., 1961 by the DDIT (Inv.)-II, Jaipur had submitted that "Cash belong to M/s Shri Ram Marble Jorhat and, which has been seized from Vijay Kumar Agarwal vs. DCIT assessee. Cash belong to firm and was brought on their behalf. There is no purchase and sale from 01.04.2018 to till date and there is no cash transaction as such copy of cash book has not been kept."

In such circumstances, it is very evident that when there were no purchase and sale from 01.04.2018 to till date of search and there was no cash transaction as such copy of cash book had not been kept, then during the appellate proceedings, the cash book produced is only after thought and cash transactions have been shown in cash book are only to substantiate the source of the cash seized.

(6) On perusal of the cash book and bank statements submitted by the appellant, it was noticed that following cash were deposited in bank account as detailed below.

Date of Bank Account Amount Deposit 11.04.2018 State Bank of 2,50,000/- India 07.05.2018 State Bank of 4,00,000/- India

Further various expenses on account of salary, rent, GST payable and others were in cash.

The cash receipts in the cash book have been shown, only to substantiate the source of the cash seized and after cash deposits in bank account and incurring of various expenses in cash, the cash of Rs. 10,00,000/- was not available in the cash book of M/s Shri Ram Marbles. In such circumstances, the cash book produced by the appellant cannot be relied upon.

(7) The AO in the assessment order had also mentioned that during the course of assessment proceedings, the assessee had been asked to explain the sources of the above cash with documentary evidences. In response to the same the assessee vide his submission dated 08.03.2021 had submitted that the cash belongs to M/s Shri Ram Marble, Jorhat and in which wife of assessee was partner. The cash was brought here to purchase marble and it was duly recorded in the book in which his wife was partner and as such it cannot be taxed u/s 69A r.w.s. 115BBE of the I.T. Act, 1961.

On perusal of the same, it is clear that the assessee has made a story for purchase of marble, however a trader cannot purchase anything in cash, which is the violation of section 40A(3) of the I.T.Act, 1961. Moreover, in this electronic age funds can be easily transferred though RTGS or various online methods, then there is no requirement to carry

Vijay Kumar Agarwal vs. DCIT such a huge cash. Hence, the story presented by Shri Vijay Kumar Goyal is beyond the truth and cannot be relied upon in the light of documentary evidences. 4.2.9 On the basis of above discussion and the facts of the case, I confirm the addition made by the AO as the appellant has failed to substantiate the source of cash seized and his claim that the cash of Rs. 10,00,000/- pertains to M/s Shri Ram Marbles and was available as cash balance in cash book. The evidences produced during the course of appellate proceeding has no relevance with the facts of the case and fabricated documents. Hence the same cannot be relied upon. The appellant has failed to establish the source of the cash and to substantiate the claim that the cash pertains to Shri Ram Marble, Jorhat. Thus, grounds of appeal 1& 2 are hereby dismissed.”

5. Felling dissatisfied with finding of the ld. CIT(A) the assessee preferred the present appeal on the grounds as raised by the assessee as reiterated here in above.

6. The ld. AR of the assessee in support of the grounds raised submitted that the assessee has categorically submitted all the required documents and proved that the cash is not belonging to him but it belong to the firm where assessee’s wife is partner. The assessee carried the cash to purchase the marble goods and he was carried the cash from (Aasam). The cash is belonging to the firm M/s. Ram Marble, Jorhat. In support of the contention he has relied upon the following documents :

S. No. Particulars Pages 1 Cash Book 18-19 1-8 2 ITR 18-19 9-12

Vijay Kumar Agarwal vs. DCIT 3 Balance Sheet at March 18 13-20 4 Purchase from Kishangarh March 2018 21-105 5 ITR 19-20 106-109 6 Balance Sheet March 19 110-115 7 Purchase from Kishangarh March 2019 116-194

7. The ld. AR of the assessee heavily relied upon the following written submission in support of the various contentions so raised in this appeal;

Brief facts of the matter are as under:- 1. A team of Income Tax authorities visited the Terminal-2, Jaipur Airport, Jaipur on 12.05.2018 and Shri Vijay Kumar Agarwal was intercepted at Jaipur Airport. Statements of Shri Vijay Kumar Agarwal were recorded U/s 131 of the I.T.Act., 1961.

Vijay Kumar Agarwal vs. DCIT Shri Ram Marble Jorhat and, which has been seized from assessee. Cash belong to firm and was brought on their behalf. There is no purchase and sale from 01.04.2018 to till date and there is no cash transaction, as such copy of cash book has not been kept.”

Ld AO held that Shri Vijay Kumar Agarwal was unable to prove the sources of cash of Rs. 10, 15,000/- found from his possession during the course of search proceedings. Therefore, an addition of Rs. 10,15,000/- was made by the AO, to the total income of the assessee by treating the same as unexplained money u/s 69A of the I.T. Act, 1961 r.w.s. 115BBE of the I.T. Act, 1961

Appellant submitted before LD CIT (A) as under :-\ 1. LD AO has never asked for further evidences i.e. cash book of M/s Shri Ram Marble, Jorhat 2. Final accounts, copy of ITR, bank statement etc

However, all the above details were produced but no cognizance was given and again we are submitting herewith

From Perusal of these it is apparent that Rs. 10, 00,000/- has been debited in cash book and appearing in final accounts in capital account of Kiran Agarwal

Vijay Kumar Agarwal vs. DCIT Further Rs. 15,000/- is his personal cash balance In the light of above facts the addition may kindly be deleted and delay may kindly be condoned.”

LD CIT (A) in the appellate order mentioned:-

In the instant case a team of Income Tax authorities visited the Terminal-2,Jaipur Airport, Jaipur on 12.05.2018 and Shri Vijay Kumar Agarwal was intercepted at Jaipur Airport. An Action u/s 132 of the I. T. Act, 1961 was carried out on 12.05.2018 by the DDIT (Inv.)-II, Jaipur in the case of the assessee. Statements of Shri Vijay Kumar Agarwal were recorded U/s 131 of the I.T. Act 1961. Shri Vijay Kumar Agarwal in his statements u/s 131 of the I.T.Act,1961 accepted that the cash of Rs. 10,00,000/- in the bag pertains to M/s Shri Ram Marble, Jorhat (Aasam). This was a partnership Firm, in which, his younger Brother’s wife Smt. Priti Agarwal and his wife Smt. Kiran Agarwal were the partners.

In his statements Shri Vijay Kumar Agarwal had also submitted that the cash amount of Rs.10,00,000/- pertains to M/s Shri Ram Marble and the same had to be given to his brother Shri Banwari Lal Agarwal for pending payments to businessmen in Kishangarh and the cash of Rs.15,000/- found in his purse belonged to him. Shri Vijay Kumar Agarwal was unable to justify the source of cash, hence the cash of Rs.10, 00,000/- was seized.

Further, it is noticed that during the post search investigations, summons u/s 131 of the IT Act., 1961 were issued to Shri Vijay Kumar Agarwal by the DDIT(Inv.)-II, Jaipur, but he had not responded to the same. However, a written reply was received wherein he had again submitted that” Cash belong to M/s Shri Ram Marble Jorhat and, which has been seized from assessee. Cash belong to firm and was brought on their behalf. There is no purchase and sale from 01.04.2018 to till date and there is no cash transaction, as such copy of cash book has not been kept.”

The AO in the assessment order had also mentioned that during the course of assessment proceedings, the assessee had been asked to explain the sources of the above cash with documentary evidences. In response to the same the assessee vide his submission dated 08.03.2021 had submitted that the cash belongs to M/s Shri Ram Marble, Jorhat and in which wife of assessee was partner. The cash was brought here to purchase marble and it was duly recorded in the book in which his wife was partner and as such it cannot be taxed u/s 69A r.w.s. 115BBE of the I.T. Act, 1961. In support of his contention the assessee had also submitted a payment voucher of Rs. 10, 00,000/- signed by the partner of the firm Smt. Preeti Agarwal and received by Vijay Kumar Agarwal vs. DCIT the assessee. Further, a certificate had also been furnished issued by the partner of the firm Smt. Preeti Agarwal wherein it was certified that the firm had paid a sum of Rs. 10,00,000/- to Shri Vijay Kumar Agarwal on 11.05 .2018. Except of the above document nothing had been filed by the assessee, in support of his contention. The assessee had neither furnished the cash book of M/s Shri Ram Marble, Jorhat nor furnished its final accounts, copy of ITR, bank statement etc. on the basis of which it can be relied upon that the sources of above cash actually pertains to the above firm. The story presented by the assessee was just an afterthought which was not supported by any credible evidence.

During the course of appellate proceedings, the appellant has filed cash book of M/s Shri Ram Marbles, Jorhat, it’s final accounts for the A.Y. 2019-20 and bank statements etc. to explain that the cash was belong to M/s Shri Ram Marbles, Jorhat in which his wife and sister-in- law were partners.

The additional evidences were forwarded to the AO to send his factual report in the matter. The report of the AO through proper channel has been received in this office on 07.11.2023 vide which the AO has submitted as under:

“Now, in the remand proceedings the submission of the assessee, forwarded to this office vide letter No.82 dated 26.10.2023, have been carefully gone through and the each issue raised by the assessee has been duly considered and following observations have been made, thereupon:- i) Assessee has submitted that Ld. AO has never asked for further evidence i.e. Cash Book of M/s Shri Ram Marble and copy of final account, ITR and bank statement. Contention of the assessee is not acceptable because, during the course of assessment proceedings, the assessee was asked to explain the sources of the above cash with documentary evidences. The assessee had submit copy of certificate of M/s Shri Ram Marble regarding payment of Rs. 10 lakh, but failed to submit proper documentary evidences like copy of the cash book, final account and bank account during the assessment processing in support of his contention. Since the assessee is presenting all these documents as evidence during the appeal proceedings, it does not seem right to accept them because the possibility of manipulation of the evidence presented after the assessment proceedings cannot be ruled out. ii) Accordingly, it is requested that the addition may be upheld and the appeal of the assessee may be dismissed on this particular issue. Submitted for your kind perusal.”

LD CIT (A) has held as under:-

Decision: The submission and the documents submitted by the appellant and the remand report submitted by the AO are considered and the facts of the case are discussed as below:

(1) During the course of search proceedings, Shri Vijay Kumar Agarwal in his statements u/s 131 of the I.T.Act,1961 accepted that the cash of Rs. 10,00,000/- in the bag pertains to M/s Shri Ram Marble, Jorhat (Aasam). This was a partnership Firm, in which, his younger Brother’s wife Smt. Priti Agarwal and his wife Smt. Kiran Agarwal were the partners. In his statements Shri Vijay Kumar Agarwal had also submitted that the cash amount of Rs.10,00,000/- pertains to M/s Shri Ram Marble and the same had to be given to his brother Shri Banwari Lal Agarwal for pending payments to businessmen in Kishangarh and the cash of Rs . 15,000/- found in his purse belonged to him.

(2) The AO in the assessment order had also mentioned that during the course of assessment proceedings, the assessee had been asked to explain the sources of the above cash with documentary evidences. In response to the same the assessee vide his submission dated 08.03.2021 had submitted that the cash belongs to M/s Shri Ram Marble, Jorhat and in which wife of assessee was partner. The cash was brought here to purchase marble and it was duly recorded in the book in which his wife was partner and as such it cannot be taxed u/s 69A r.w.s. 115BBE of the I.T. Act, 1961.

(3) Shri Vijay Kumar Agarwal during the search proceedings submitted that the cash had to be given to his brother Shri Banwari Lal Agarwal for pending payments to businessmen in Kishangarh and during the course of assessment proceedings submitted that cash was brought here to purchase marble and it was duly recorded in the book in which his wife was partner. On the basis of the above, it is clear that Shri Vijay Kumar Agarwal was hiding the facts of the case and telling a fabricated story that the cash pertained to M/s Shri Ram Marble, Jorhat.

(4) Shri Vijay Kumar Agarwal had neither explained the sources of the above cash with documentary evidences during the course of post search investigations nor during the course of assessment proceedings. Shri Vijay Kumar Agarwal had submitted that the cash belongs to M/s Shri Ram Marble, Jorhat, only to change the direction of the investigation and to safe himself from any litigation. His non cooperation has established his moto behind the fabricated story.

(5) Further, it is noticed that during the post search investigations, summons u/s 131 of the IT Act., 1961 were issued to Shri Vijay Kumar Agarwal by the DDIT(Inv.)-II, Jaipur, but he had not responded to the Vijay Kumar Agarwal vs. DCIT same. However, a written reply was received wherein he had again submitted that “Cash belong to M/s Shri Ram Marble Jorhat and, which has been seized from assessee. Cash belong to firm and was brought on their behalf. There is no purchase and sale from 01.04.2018 to till date and there is no cash transaction, as such copy of cash book has not been kept.”

On the basis of the above submission, it is clear that there was no purchase and sale from 01.04.2018 to till date of search and there was no cash transaction, hence copy of cash book had not been kept. But during the course of appellate proceedings, the appellant has submitted the copy of the cash book of M/s Shri Ram Marbles, Jorhat, and shown various transactions in cash. The relevant pages of the cash book submitted by the appellant till 11.05.2018

On the basis of above, it is evident that the above cash book has been prepared only after the post search investigations and assessment proceedings. Shri Vijay Kumar Agarwal had submitted before the DDIT (Inv)-II, Jaipur during the course of the post search investigations and in compliance to summons u/s 131 of the Income Tax Act. 1961 that “Cash belong to M/s Shri Ram Marble Jorhat and, which has been seized from assessee. Cash belong to firm and was brought on their behalf. There is no purchase and sale from 01.04.2018 to till date and there is no cash transaction, as such copy of cash book has not been kept.”

In such circumstances, it is very evident that when there were no purchase and sale from 01.04.2018 to till date of search and there was no cash transaction as such copy of cash book had not been kept, then during the appellate proceedings, the cash book produced is only after thought and cash transactions have been shown in cash book are only to substantiate the source of the cash seized.

Aggrieved with this Appellant is in appeal and grounds of appeal

, are:-

1. On the facts and in the circumstances of the case the CIT (A) has erred in confirming the addition of the amount of Rs. 10, 15,000/- seized from the appellant at Jaipur Air-Port on 12 the May, 2018 pertained to him.

2. That the ld.CIT (A) has erred on facts and in law in confirming the addition of a sum of Rs. 10, 15,000/- as unexplained money of the appellant and application of the provision of section 69A r.w.s. 115BBE of the Act.

3. The appellant keeps its right reserve to add, amend or withdraw any ground of appeal before or at the time of hearing of the appeal.

Vijay Kumar Agarwal vs. DCIT 4. All the grounds of appeal are independent and without prejudice to each other Submission: At the time of seizure itself the appellant had stated this fact that money belongs to M/s Shri Ram Marble Jorhat That cash book submitted does not have any cash introduction and as such it is not correct to say that cash book was manipulated and even otherwise if the cash belongs to firm the source was to be examined there. In support of opening cash balance, balance sheet of 31.03.2018 us enclosed in which closing cash balance 14,21,179/- When cash seized how purchase can be made from that amount after seizure it came to notice that cash payment over 10,000/- cannot be made in cash and all the payments were made through banking channel only It is also submitted that detail of purchases were submitted and from Kishangarh purchases are there but payments were made through banking channel. However, purchases less than 10,000/- are made in cash In view of above the appeal may be allowed.”

8. The ld DR is heard who relied on the findings of the lower authorities and more particularly advanced the similar contentions as stated in the order of the ld. AO and ld. CIT(A).

Cash belong to M/s Shri Ram Marble Jorhat and, which has been seized from assessee. Cash belongs to firm and was brought on their behalf. There is no purchase and sale from 01.04.2018 to till

Vijay Kumar Agarwal vs. DCIT date and there is no cash transaction, as such copy of cash book has not been kept on record. The AO in the assessment order had also mentioned that during the course of assessment proceedings, the assessee had been asked to explain the sources of the above cash with documentary evidences. In response to the same the assessee vide his submission dated 08.03.2021 had submitted that the cash belongs to M/s Shri Ram Marble, Jorhat and in which wife of assessee was partner. The cash was brought here to purchase marble and it was duly recorded in the book in which his wife was partner and as such it cannot be taxed u/s 69A r.w.s. 115BBE of the I.T. Act, 1961. In support of his contention the assessee had also submitted a payment voucher of Rs. 10, 00,000/- signed by the partner of the firm Smt. Preeti Agarwal and received by the assessee. Further, a certificate had also been furnished issued by the partner of the firm Smt. Preeti Agarwal wherein it was certified that the firm had paid a sum of Rs. 10,00,000/- to Shri Vijay Kumar Agarwal on 11 .05 .2018. The ld. AO noted that except of the above document nothing had been filed by the assessee, in support of his contention. The assessee had neither furnished the cash book of M/s Shri Ram Marble, Jorhat nor furnished its final

Vijay Kumar Agarwal vs. DCIT accounts, copy of ITR, bank statement etc. on the basis of which it can be relied upon that the sources of above cash actually pertains to the above firm. Based on these set of facts he made an addition of Rs. 10,15,000/- found in his possession at Jaipur airport. The assessee contended before the ld. CIT(A) that LD AO has never asked for further evidences i.e. cash book of M/s Shri Ram Marble, Jorhat and final accounts, copy of ITR, bank statement etc., to explain that the cash was belong to M/s. Shri Ram Marbles, Jorhat in which his wife and sister in law were partners. The ld. CIT(A) considered this as additional evidence and was forwarded to the ld. AO and the ld. AO in the remand report contended that it does not seem right to accept the evidence because there are possibility of manipulation of the evidence presented after the assessment proceeding cannot be ruled out. Whereas the ld. CIT(A) contended that Shri Vijay Kumar Agarwal had neither explained the source of the cash with documentary evidence during the course of search or during the post search investigation nor in the assessment proceeding. The assessee has not responded to the post search summons of the DDIT(Inv-II) and only written reply was submitted.

There is no purchase or sales and there is no cash transaction as Vijay Kumar Agarwal vs. DCIT such copy of cash book has not been kept. On perusal of the cash book he noted that cash were deposited in the bank on 11.04.2018 for Rs. 2,50,000/- and Rs. 4,00,000/- on 07.05.2018. Further the cash expenses like salary, rent GST were also in cash. The cash receipts in the cash book have been shown only to substantiate the source of cash seized. The ld. CIT(A) thus noted after cash deposits in the bank account and after the expenditure there is no scope of having cash of Rs. 10,00,000/- in the cash book of M/s.

Shri Ram Marbles and based on that reasoning he has disbelieved the cash book produced by the assessee of Shri Ram Marbles.

Before, us the ld. AR of the assessee submitted that the assessee at the first time when he was searched at the airport he has categorically stated that this cash is belonging to Shri Ram Marbles, Jorhat and he carried the cash. In support of this contention the ld. AR of the assessee submitted the additional evidence such as cash book of M/s Shri Ram Marble, Jorhat and final accounts, copy of ITR, bank statement etc., to explain that the cash was belong to M/s. Shri Ram Marbles, Jorhat in which his wife and sister in law were partners. After admitting the said additional evidence the same were forwarded to the ld. AO who has simply

Vijay Kumar Agarwal vs. DCIT without dealing with the evidence submitted that all these documents were not submitted in the assessment proceeding and are after though of the assessee to explain the source of the cash.

The ld. AR of the assessee submitted before us that the cash book submitted does not have any cash introduction and as such it is not correct to say that cash book was manipulated and even otherwise if cash belong to the firm the source was to be examined there. In support of these he also submitted that the firm is having opening cash balance of Rs. 14,21,179/- for which balance sheet is already filed as at 31.03.2018. As regards the purchases not made once the working capital of the firm is seized then how that firm make the purchase and sales. From the cash book there is no purchase exceeding Rs. 10,000/- in cash. The revenue could not controvert the fact that Shri Ram Marbles as at 31.03.2018 having cash balance of Rs. 14,21,179/- as per audited accounts having dated 27.10.2018 and from that source of Rs. 10,00,000 can easily be justified in hands of the Shri Ram Marble and there is no defect whatsoever found in the cash book and other records produced.

The assessee from the first instance at the airport submitted that this cash belonging to the firm Shri Ram Marbles and the said

Vijay Kumar Agarwal vs. DCIT statement is corroborated with the independent evidence merely the same were though presented before the ld. CIT(A) as alleged cannot be said to be after thought.

Based on the above discussion the ground no. 1 & 2 raised by the assessee is allowed. Ground no 3 & 4 being general in nature the same is not required to be adjudicated.

In the light of the above discussion the appeal of the assessee is allowed.

Order pronounced in the open court on 19/01/2024.