ANIL KUMAR PATRA,BHUBANESWAR vs. ITO, WARD-2(2), BHUBANESWAR

This is an appeal filed by the assessee against the order of CIT(A)-2,

Bhubaneswar, dated 18.8.2016 for the assessment year 2005-06.

confirming the addition of Rs.10,41,500/- for deposits made in the bank

account of the assessee.

authorities and materials available on record. In the instant case, the

Assessing Officer made addition of Rs.10,41,500/- for cash deposits in

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saving bank account No.906182 with Uco Bank, Secretariat Branch,

Bhubaneswar.

assessee was arrested in a criminal case and was confined in the Special

Jail at Bhubaneswar and, therefore, he could not furnish details as called

for by the Assessing Officer. Considering the plea of the assessee, the

CIT(A) admitted the submission and called for a Remand Report from the

Assessing Officer. The Assessing officer vide letter No.ITO/Ward-

4(2)/BBSR/2015-16/10651 dated 1.3.2016 submitted his report, wherein,

the Assessing Officer stated that the assessee did not file the required

details before him.

the assessee filed balance sheet and profit and loss account for the

assessment years 2004-05 and 2005-06, cash flow statement for the above

mentioned period and voucher of purchase and sale of old vehicle during

the period. It was submitted that the above documents produced before

the Assessing Officer corroborated the substantial explanation relating to

the unexplained money of Rs.10,41,500/- as treated by the Assessing

Officer in the original assessment order. The Assessing Officer without

considering the materials submitted by the assessee and without examining

the books of account produced before him, given an erroneous view in his

remand order.

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the assessee needs to withdraw money for running his house hold

expenditure as well as for conducting the business. It is not possible that

whatever he is withdrawing, he is able to deposit out of that withdrawals.

The assessee has not submitted a comprehensive cash flow statement

comprising the household expenses and business expenditure and,

therefore, the assessee did not substantiate his claim either during the

assessment proceedings or remand proceedings and confirmed the action

of the Assessing Officer.

copy of bank statement of the assessee with Uco Bank from where it is seen

that the assessee has made cash deposits in the bank as under:

Date Amount (Rs.) 16.4.2004 50,000 19.4.2004 25,000 23.4.2004 2,10,000 27.4.2004 9,000 26.5.2004 21,000 28.5.2004 1,50,000 30.6.2004 4,75,000 14.8.2004 50,000 28.5.2004 500 8.1.2005 14,000 18.1.2005 20,000 19.2.2005 ` 10,000 23.3.2005 5,000 31.3.2005 2,000 Total: 10,41,500

I also find that the assessee had withdrawn the following amounts

as under:

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Date Amount (Rs.) 3.4.2004 1,90,000 12.4.2004 10,000 28.4.2004 30,000 21.5.2004 1,50,000 7.6.2004 4,70,000 6.7.2004 1,00,000 26.7.2004 3,60,000 19.8.2004 20,000 23.8.2004 5,000 25.8.2004 30,000 2.11.2004 7,000 12.1.2005 2,000 24.1.2005 10,000 28.1.2005 8,000 11.2.2005 2,000 31.3.2005` 1,00,000 Total: 14,94,000

Thus, it is seen that the assessee has made withdrawals of

Rs.14,94,000/- and deposits of Rs.10,41,5000/- in the bank account.

Hence, the withdrawals is more than the amount of cash deposit in the

bank account. Further, it is observed that the withdrawal made by the

assessee from the said account are earlier to the deposits made in the said

bank account except for deposit of Rs.2,10,000 made on 23.4.2004. The

contention of the assessee is that the earlier withdrawals from the bank

were utilized for making deposit in the bank account of the assessee. Thus,

the source of deposit of Rs.8,31,500/- is explained by the assessee. The

submission of the ld Authorised Representative of the assessee has not

been controverted by ld Departmental Representative during the course of

hearing. In the above facts and circumstances of the case, in my

considered opinion, as the earlier withdrawals made by the assessee from

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his bank account explains the source of deposits in the bank at a later date,

the source of deposits in the bank of Rs.8,31,500/- stands explained and

hence, no addition u/s.69 of the Act of Rs.8,31,500/- is called for. The

addition of Rs.2,10,000/- takes care of household expenses as well as the

expenditure for conducting business of the assessee. Hence, I delete the

addition of Rs.8,31,500/- and confirm the balance amount of disallowance

of Rs.2,10,000/- and partly allow this ground of appeal of the assessee.

SR.PRIVATE SECRETARY ITAT, Cuttack