RAMESH VERMA,MORADABAD vs. ITO,2(1), MORADABAD

1. The Ld. CIT(A) has erred in law and against the facts of the case for confirming the addition of Rs.71,12,000/- made by the Ld. AO without accepting plea of the assessee.

2. That the Ld. CIT(A) has erred in law and against the facts and circumstances of the case, for confirming the addition of Rs.7112000/-, out of total addition of Rs.95,12,000/- made by the Ld. AO vide his order dated 14/12/2019, by alleging that normally, the cash is withdrawn from the bank account of meet any expenditure or payment obligations and accordingly, the cash withdrawn from the bank account is not always available for re-deposit into the bank account as claimed by the appellant. In view of the above, the cash book submitted by the appellant lack credibility. Accordingly, I do not find any merit in the appellant argument that the cash deposited in the bank account is explained by the cash withdrawal made in the bank accounts and dismiss the without same, appreciating the facts of the case and documents furnished by the assessee and only on the basis assumption.

3. That the Ld. CIT (A) has erred in law for not accepting the cashbook submitted by the assessee as evidence in support of his claim by alleging that the cashbook was Ramesh Verma vs. ITO submitted for the first time during this proceeding which was not submitted before the assessing officer. Accordingly, the same becomes additional evidence as per Rule 46A of the Income Tax Rules and the appellant had not furnished any request for admission of additional the evidence explaining the circumstances for its admissibility, without following the doctrine of natural justice as well as without considering the fact that cash flow statement is not an additional evidence, while it is only the explanation of entries of each deposited and withdrawals from his bank accounts, which was already submitted.

4. That the appellant craves leave to add, alter, delete, rectify and modify any of the grounds of appeal

before or at the time of hearing the appeal.”

5. All the three effective grounds of appeal taken by the assessee are with respect to the confirmation of addition of Rs.71,12,000/- made by the AO by holding the cash deposited into bank as unexplained.

6. Before us, Ld. AR of the assessee submits that though during the course of assessment proceedings, assessee was unable to file any explanation with respect to the source of cash deposited, however the assessee filed his Balance Sheet and the copy of the bank statements along with the ledger account of cash wherein the cash withdrawals made from time to time and redeposit out of such withdrawals were duly appearing as per which there was sufficient balance available with the assessee in the shape of cash in hands before making deposits in the bank. For this he drew our attention to the paper book pages 2 and 3 which contained the cash ledger and further page 4 to 18 are the copies of the bank statements of both the bank account in support of the claim of withdrawals. He further submits that both these bank accounts were duly recorded in the books of accounts maintained and part of the regular books of accounts thus, the provisions of section 69A of the Act cannot be invoked in the present case. Ld. AR, therefore, prayed for the deletion of the additions so made being fully backed by bank withdrawals made much prior to date of deposit of cash in the bank accounts. He prayed accordingly.

Ramesh Verma vs. ITO 7. Per contra, the Ld. Sr. DR vehemently supported the order of AO and CIT(A) and submits that merely stating there was cash balance available out of the bank withdrawals cannot be accepted in absence of the details. He further submits that the cash withdrawals were for business purposes, and the assessee has tried to take the shelter of the same to explain the source and, therefore, he requested confirmation of the addition so made.