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2014 (3) TMI 958 - AT - Income TaxAddition on deposits in Bank accounts to the income of the appellant - Held that:- Assessing Officer rightly held that the amount of ₹ 17,63,318/- was unexplained cash deposit in the bank account of the assessee and the explanation offered by the assessee was not acceptable and tenable to justify and explain these unexplained cash deposits in the SB account of the assessee. At the same time, we take cognizance of this legal proposition that in this situation, the entire amount of cash deposits in the bank account of the assessee cannot be treated as undisclosed income of the assessee because the possibility of rotation of same cash amount as deposits and withdrawals cannot be ruled out and, in this situation, the principle of peak credit addition is applicable. Assessee submitted that the bank accounts in question for both deposits and withdrawals, the same funds are circulated and hence only peak credit should be brought to tax. On this alternative argument and submissions of the assessee, ld. DR though not conceded the arguments of the assessee but ultimately agreed that only peak credit is to be taxed, hence, we hold that only peak credit appearing in the respective bank account of the assessee can be brought to tax as there is rotation of the same funds. Hence, we set aside the issue of computation of peak credit to the file of Assessing Officer for bringing the same to tax. - Decided partly in fvaour of assessee for statical purposes.
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