SMT SHIKHA MAHENDRA SINGH,BHOPAL vs. THE ITO 4(4), BHOPAL

The ld. Assessee’s representative submitted that on the facts and circumstances of the case, the authorities below were not correct in making (Smt. Shikha Mahendra Singh vs. ITO) A.Y. 2012-13 2 and confirming the addition in the hands of the assessee u/s 69A of the Act. The ld. AR also submitted that the findings and decision of the AO for making the addition of Rs.17,63,000/- are wrong, opposed to the facts, unjudicious, unlawful and without jurisdiction. Hence, such findings be quashed and the addition may kindly be deleted. The ld. Counsel also submitted that the impugned addition is not in the nature of income referred to in sections 68 or 69 or 69A or 69B or 69C of the Act and, therefore, the provisions of section 115BB are not applicable to the case and, so, the levy of tax under the said sections are unlawful and without jurisdiction. The ld. Counsel submitted that the assessee has withdrawn Rs.12,90,000/- in the beginning of the previous year and also made withdrawals in the current year and again deposited the same in the same bank account. Therefore, no addition is called for in this regard. The ld. AR, alternatively, submitted that the statements showing sources of cash deposits with the bank account clearly shows that during the relevant financial period, the assessee withdrew cash and redeposited the same and the peak amount of credit is Rs.8,03,000/- as on 23.02.2012. Therefore, the entire deposits of Rs.17,63,000/- cannot be treated as unexplained deposit in the hands of the assessee for making addition u/s 69A of the Act. The ld. AR submitted that the assessee is approximately 40 year old and a working lady and has been consistently filing return of income for approximately 15 years, therefore, out of said peak amount, some credit is also required to be given to the assessee on account of cash in hand out of savings which is consistently kept in cash by the assessee.

Replying to the above, the ld. Sr. DR strongly supported the assessment as well as the first appellate order. The ld. Sr. DR also submitted that the statement submitted by the assessee showing sources of cash deposit in the bank account reveals minus peak credit as on (Smt. Shikha Mahendra Singh vs. ITO) A.Y. 2012-13 3 23.02.2012 at Rs.8,03,000/- which cannot be ignored in any case, therefore, the addition made by the AO and confirmed by the ld. CIT(A) may kindly be upheld.

On careful consideration of the above submissions, first all, we may point out that the ld. Sr. DR has not disputed that the assessee withdrew cash and redeposited the same to the same bank account and the statement showing sources of cash deposit to her bank account clearly reveals that the peak credit was Rs.8,03,000/- as on 23.02.2012. This factual situation has not been disputed by the ld. Sr. DR in any manner. The ld. AR, explaining the source of the impugned amount, submitted that the cash deposits in the bank were made by the appellant out of cash balance available on the first day of the relevant previous year, which, got accumulated by the agricultural income derived by her in the earlier years and also out of her past savings. But, the details of such amounts are not discernible neither from the orders of the authorities below nor from the submissions made by the assessee during assessment and first appellate proceedings. So far as redeposit of withdrawn amount is concerned, this fact has been taken care while preparing the statement showing sources of cash deposit in the bank account out of which the amount of peak credit has been extracted. It has also been contended that the deposit has also been made out of cash withdrawn by her from her bank account on regular intervals during the relevant previous year itself and from the said statement showing peak, the amount of Rs.3,60,000/- has been taken as opening balance which is taking care of withdrawals of previous year. So far as the third explanation that the impugned cash has been deposited out of receipts from other explained sources is concerned, in this regard, the ld.CIT(A), in the first appellate order, has categorically noted that no agricultural income has been disclosed by the appellant in the return of income for the relevant assessment year. Therefore, we reach to a logical conclusion that the (Smt. Shikha Mahendra Singh vs. ITO) A.Y. 2012-13 4 ld.CIT(A) has taken care of all facts and circumstances of the case and the ld. Sr. DR has not disputed the factum of peak credit as on 23.02.2012 amounting to Rs.8,03,000/-.

So far as the factum of cash in hand and the amount of savings made during the preceding years is concerned, we are of the view that when the assessee has consistently been earning income, filing the income-tax return, paying tax thereon, then, the possibility of cash in hand out of savings cannot be denied in toto. The onus was on the assessee to show the factum of cash in hand out of savings of preceding assessment years for which there is no facts before us. Therefore, we deem it proper to allow part relief on estimation basis on this count. In the totality of facts and circumstances of the case, we deem it just and proper to allow 50% deduction in the peak amount on account of cash in hand in the beginning of the year and past savings in the form of cash out of income earned during the immediately preceding several assessment years. Therefore, the addition made by the AO and confirmed by the ld.CIT(A) is restricted to Rs.4,01,500/-. The grounds of the assessee on merits are partly allowed in the manner as indicated above.

In the result, assessee’s appeal is partly allowed.