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2015 (11) TMI 1601 - AT - Income TaxAddition on cash deposits in undisclosed bank balance - Held that:- The discretion has been conferred on the Income tax Officer u/s 69 of the Act to treat the source of investment as the income of the assessee if the explanation offered by the assessee is not found satisfactory and the said discretion has to be exercised keeping in view the facts and circumstances of the particular case. The Income Tax Officer is not obliged to treat the value of investment as income in every case where the explanation offered by the assessee is found to be unsatisfactory. Hence it would be unreasonable to tax all the deposits in the bank account of the assessee. To this extent, we do not appreciate the action of the ld. AO in taxing the entire credits of ₹ 6,30,89,413/- as undisclosed income of the assessee for A.Y.2006-07. To put this ongoing dispute to rest, in the interest of justice and fair play, we direct the ld. AO to assess the peak credit in this case in respect of both cash as well as cheque transaction contained in the said bank account by verifying the veracity of the figures worked out by the assesse and bring to tax the same. Thus we direct the AO to assess the peak credit being a sum of ₹ 1,01,40,000/- as computed by assessee on the basis of deposits made in these six bank accounts with Axis Bank Ltd. in lieu of cash deposits added by the AO at ₹ 83,48,16,130/-. Accordingly, the AO will verify the peak and will make addition of the peak amount only. Accordingly, this issue of assessee’s appeal is partly allowed for statistical purposes.
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