MINA,KURUKSHETRA vs. ITO, W-2, KURUKSHETRA

At the outset, the ld. counsel for the assessee has invited my attention to the impugned assessment order to submit that the same Mina v. ITO 2 is ex-parte/best judgment assessment order under Section 144 of the Income Tax Act.

The Ld. Counsel has further invited my attention to the impugned order of the ld. CIT(A) to submit that it was duly explained before the CIT(A) that the aforesaid amount of Rs.34 lacs was withdrawn immediately before the redeposit of the same in the bank account of the assessee. That the assessee had explained that the assessee wanted to apply for the allotment of petrol pump, however, since the said proposal did not mature due to the certain reasons, the amount was redeposited. The ld. counsel in this respect has brought my attention to page 7 of the paper book to show that amount of Rs.5 lacs was withdrawn by her husband Mr. Rajendra s/o Subhash Chandra from his bank account on 13.04.2010 which was deposited in the bank account of the assessee and further that an amount of Rs.2 lacs was received by her from her father in law Shri. Subhash Chandra on the same date, i.e. on 13.04.2010. Therefore, total Rs.7 lacs was deposited in her account on 15.04.2010. The ld. counsel has further demonstrated that the said amount was withdrawn and redeposited time and again in the Bank A/c of the assessee. Time gap between the deposits made and withdrawals is very small i.e. either on the same day or the next day. The ld. counsel in this respect has explained that the assessee Mina v. ITO 3 was advised to make frequent transaction in her bank account to be eligible to apply for allotment of petrol pump, however, the aforesaid advice given to the assessee was not found to be correct and the proposal to apply for the petrol pump was dropped. He has further explained that the bank statement coupled with cash flow statement duly explain the source of the deposits, withdrawals and redeposits.

The ld. DR, however, has contended that the assessee has not explained the source of deposit in the Bank A/c of her husband to the extent of Rs.5 lacs and in the Bank A/c of her father in law to the extent of Rs.2 lacs. She has also contended that the assessee has failed to explain the transactions of frequent cash deposits and withdrawals.

I have heard and considered the rival contentions. A perusal of the statement of Bank account as well as the cash flow statement of the assessee reveals that the assessee has duly explained the source of deposit and also explained that the same amount was withdrawn and redeposited time and again in the Bank A/c of the assessee out of some wrong advice to do frequent transaction of withdrawals and deposits in her Bank A/c. The small amount of Rs.5 lacs was received from her husband and the further small amount of Rs. 2 Mina v. ITO 4 lacs from her father in law, which has been duly been demonstrated by furnishing the copies of the Bank A/c statement and the cash flow statement. The entire transaction of cash withdrawal and deposits has been explained. In view of this, I do not find any justification on the part of the lower authorities in making the impugned addition and the same is accordingly ordered to be deleted.

In the result, the appeal of the assessee stands allowed.