UTSOV DHOWAN,MUMBAI vs. ITO 19(3)(4), MUMBAI

The appeal filed by the assessee is directed against the order dated 19.11.2013 passed by the ld. CIT(A)-18, Mumbai and it relates to the assessment year 2008-09.

The assessee is aggrieved by the decision of the ld.CIT(A) in confirming the addition of Rs.17,37,109/- made by the AO u/s 69A of the Income Tax Act, 1961.

We heard the parties and perused the record. The assessee filed its return of income for the year under consideration declaring the total income of Rs.1,70,230/-. During the course of assessment proceedings, the AO noticed that the assessee has maintained a bank account with M/s Axis Bank, wherein he has deposited amounts aggregating to Rs.17,37,109/- by way of cash and other deposits. The assessee did not furnish any explanation before the AO and also did not co-operate with the AO. Hence, the AO completed the assessment to the best of his judgment by assessing the above said sum of Rs.17,37,109/- as income of the assessee.

In the appellate proceedings before the ld. CIT(A), the assessee’s father furnished an affidavit stating that the above said deposits represent money given by him to the assessee. However, no evidence was furnished to corroborate the submissions made in the affidavit and hence the ld. CIT(A) rejected the same. The assessee also took the alternative argument that peak amount of deposits should have been taken as income. The ld. CIT(A) rejected the said contention also on the reasoning that the assessee did not furnish any evidence to show that cash deposits were made on different occasions. Accordingly, the ld.CIT(A) dismissed the appeal filed by the assessee.

With regard to the affidavit furnished by the father of the assessee, we find that the Ld CIT(A) was justified in rejecting the same, since the contents of the said affidavit was not substantiated with evidences. Before us, the ld.counsel of the assessee submitted a copy of bank statement /account as well as the peak credit workings and accordingly prayed that the peak credit balance may be taken as the income of the assessee. Though the ld.DR strongly objected to the said plea of the Ld A.R, in the interest of natural justice, we are of the view this alternative plea of the assessee requires examination. Accordingly, we set aside the order of the ld. CIT(A) with regard to the decision taken by him on the issue of peak credit and restore the same to the file of the AO with a direction to examine the claim of the assessee by duly considering the bank account and other explanations that may be furnished by the assessee. After affording necessary opportunity of hearing to the assessee, the AO may take appropriate decision in accordance with law.

In the result, the appeal filed by the assessee is treated as partly allowed for statistical purpose.