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Income Tax Appellate Tribunal, ‘C’ BENCH : BANGALORE
Before: SMT. P. MADHAVI DEVI & SHRI JASON P.BOAZSmt.Bharathi Narayan,
This appeal by the assessee is directed against the order of the CIT(A)-II, Bangalore, dated 01/05/2015 confirming the addition of Rs.4.92,000/- made by the Assessing Officer (AO) u/s 68 of the Income-tax Act, 1961 [hereinafter referred to as 'the Act' for short] for assessment year 2010-11.
Smt.Bharathi Narayan Page 2 of 5 2. Brief facts of the case are that the assessee, an individual, filed her return of income for the assessment year 2010-11 on 29/06/2010 declaring total income of Rs.6,53,440/-. During the assessment proceedings u/s 143(3) of the Act, the assessee was required to produce the books of account and other supporting documents in respect of the claims made in the return of income more particularly in respect of credits in her bank account by way of cash. The assessee submitted a reply dated 29/10/2012 explaining the sources for cash deposit into her bank account. The details of the said letter are reproduced at pages 2 to 4 of the assessment order. The assessee had also explained that the assessee had withdrawn a sum of Rs.5 lakhs from her bank account by way of a bearer cheque issued in the name of Shri K.Lakshminarasimha Murthy who returned the money to her. The assessee was directed to produce the bank statement of Shri K.Lakshminarasimha Murthy and also to produce such person. The assessee filed a letter stating that Shri K.Lakshminarasimha Murthy was not available to be produced. The AO, holding that the assessee has failed to explain the source of deposit into her account on 3/8/2009 (Rs.2 lakhs), 28/8/2009 (Rs.1 lakh), 3/12/2009(Rs.92,000/-), 4/12/2009 (Rs.20,000/-) and 7/12/2009 (Rs.80,000/-) treated the said amount as unexplained credit and added it to the total income of the assessee u/s 68 of the Act.
Smt.Bharathi Narayan Page 3 of 5 3. Aggrieved, assessee preferred an appeal before the CIT(A) who confirmed the addition holding it to be a loan from Shri K.Lakshminarasimha Murthy. Aggrieved, assessee is in second appeal before us.
Learned counsel for the assessee submitted that the assessee has explained sources of the cash deposits into her account as amounts withdrawn from her own account but neither of the authorities below have properly verified the same and the CIT(A) has erroneously upheld the addition made by the AO. He has filed before us copy of the letter issued by the Kanakapura Branch of the State Bank of Mysore stating that a sum of Rs.5,00,000/- has been withdrawn by K.Lakshminarasimha Murthy through bearer cheque No.381861 dated 22/06/2009 (on behalf of Smt.Bharathi Narayan from her account No.364024070269). Learned counsel for the assessee has also filed before us a copy of the bank statement of the assessee with State Bank of Mysore, Kanakapura reflecting the transaction. He, therefore, submitted that the AO has erroneously treated the same as unexplained cash credit while the CIT(A) has treated it as a loan from Shri K.Lakshminarasimha Murthy, which is not correct.
Learned Departmental Representative, on the other hand, supported the orders of the authorities below and submitted that the assessee had failed to produce documentary evidence in Smt.Bharathi Narayan Page 4 of 5 support of her contention due to which the authorities below have confirmed the addition.
Having regard to the rival contentions and the material on record, we find that the assessee had contended before the AO that the source of deposits was the cash withdrawn from the State Bank of Mysore on 28/6/2009. However, before us now, it is the contention of the assessee that the source of the deposit is the withdrawal of cash from the State Bank of Mysore, vide cheque bearing No.381861 on 22/6/2009. From the statement of account of the assessee in the State Bank of Mysore, we find that there is no withdrawal on 28/6/2009, but the withdrawal dated 22/6/2009 is very much reflected. Therefore, in the interest of justice, we deem it fit and proper to remand the issue to the file of the AO with a direction to verify the bank statement of the assessee and the letter issued by the bank filed by the assessee and if they are found to be genuine, then the same may be treated as the source for cash deposit into assessee’s bank account. The AO’s finding that the assessee has failed to file the bank account copy of Shri K.Lakshminarasimha Murthy is irrelevant because the assessee has withdrawn cash from her account as it is the case of the assessee was that a bearer cheque was in the name of Shri K.Lakshminarasimha Murthy and therefore the same would definitely not be reflected in his bank account. Therefore, that should not come in the way of the assessee’s explaining the Smt.Bharathi Narayan Page 5 of 5 source of cash deposit into her bank account by withdrawal from her own bank account through the bearer Shri K.Lakshminarasimha Murthy.