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Income Tax Appellate Tribunal, “C ” BENCH: KOLKATA
Before: Shri Mahavir Singh, JM & Shri M. Balaganesh, AM]
Per Shri Mahavir Singh, JM:
This appeal by revenue is arising out of order of CIT(A), Durgapur vide Appeal No. 207/CIT(A)/DGP/2011-12 dated 18.09.2012. Assessment was framed by ITO, Ward-2(4), Durgapur u/s. 143(3) of the Income-tax Act, 1961 (hereinafter referred to as “the Act”) for Assessment Year 2009- 10 vide his order dated 30.12.2011.
At the outset, it is noticed that this appeal of revenue is time barred by 19 days and revenue has filed condonation petition stating the reasons. Ld. Counsel for the assessee fairly conceded that he is not interested in opposing the condonation petition. Hence, the delay is condoned and appeal of revenue is admitted for hearing. 3. The only issue in this appeal of revenue is against the order of CIT(A) in directing the AO to assess the peak amount out of the deposits made in five bank accounts. 4. Briefly stated facts are that the AO during the course of assessment proceedings noticed from the AIR information that it is maintaining following five bank accounts: “Sl. No. Name of the Bank Account Number 1. Axis Bank/Rashbehari Branch 253010100035398 2. Axis Bank/Memari Branch 445010100035264 3. State Bank of India/Talit Branch 20016352694 4. State Bank of India/Chotkhanda Branch 11877248002 5. State Bank of India/Chotkhanda Branch 118772445410”
According to AO, there are total deposit in the bank accounts at Rs.48,36,000/-. As the assessee could not explain the source of deposit, the AO added the entire amount of Rs.48.36 lakhs as unexplained deposits in the bank accounts u/s. 69A of the Act. Aggrieved, assessee preferred appeal before CIT(A), who directed the AO to compute the peak credit and assessed only peak credit by observing as under: “Though three grounds have been preferred the issue involved is same, namely addition of Rs.48,46,894/- made by the AO. The facts of the case are that the appellant's returned income has been rejected by the AO. who has taken the view that the appellant has not conducted any business. However, while discussing elaborately in his order as to why he feels that the appellant's income from business should be taken as 'nil' as against the income disclosed in the return, it is seen that while computing the income he has assessed the income disclosed under the head 'business'. That Prasanta Singha Roy AY 2009-10 apart the A.O. has added RS.48,46,894/- being deposits found in five bank accounts held either by the appellant or jointly with his wife. The appellant had sought to explain these deposits as cash sales of seasonal crops, an explanation which the A.O. rejected. Having done so, the AO proceeded to assess the entire deposits as unexplained. The appellant's submission is that he has been carrying on business of dealing in agricultural crops for the last few years and that fact has never been challenged in the past. However, at this stage, I do not find it necessary to go into this issue as that has little bearing on the addition made. I do not see the appellant coming forward with any coherent explanation regarding these cash deposits. Therefore, in my opinion, the view taken by the AO to assess these cash deposits as ‘Income from other Sources’ is substantially correct. However, if there is no explanation for these deposits, it will be proper to apply the judicially approved principle of peak credit here. While giving effect to this order, the AO will compute the peak credit across the five bank accounts and assess the income accordingly. These grounds of appeal are, therefore, partly allowed subject to the direction given above.”