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2018 (7) TMI 2167 - ITAT CHENNAIAddition u/s 68 - difference in opening balance to the extent not explained by the assessee - CIT-A deleted the addition - HELD THAT:- Assessee could change any figures given in table given to satisfy the requirement of capital as on 01.04.2011, and argue that opening balance as on 01.04.2011 were from balances available with it on 01.04.2003, and hence could not be considered for addition in the impugned assessment year. If such claim is allowed, any amount shown by the assessee as opening balance can be claimed as coming out from balances of the earlier years. Despite this lacuna in the claim of the assessee, AO accepted what all the assessee could even remotely substantiate in such opening balance. AO, in our opinion was more than fair in accepting every explanation given by the assessee except for its claim of opening capital of ₹ 1,02,06,929/- as on 01.04.2003 and deficit due to non reflection of drawings and sources for tax payments in the earlier years. Assessee was duty bound to explain every rupee out of the opening capital balance of ₹ 7,46,48,917/- shown by it as on 01.04.2011. Especially so since it had shown ‘’Nil’’ amount as its capital in the Balance sheet as on 31.03.2011 forming part of its return for assessment year 2011-12. Explanation of the assessee that the sum of ₹ 1,02,06,929/- represented cash in hand, value of food grain stock and value of agricultural produce was not substantiated before the ld. Assessing Officer, through any evidence. That apart, agricultural income shown by the assessee himself was in the vicinity of ₹ 1,00,000/- to ₹ 1,25,000/- per year, and the probability of accumulating a huge amount from such agricultural income was negligible. Drawings and taxes in the earlier years - It is an admitted position that such drawings and taxes do not appear in the table furnished by the assessee reproduced by us at para 3 above - assessee had no source for his personal expenses and taxes paid. Hence, we have to consider that such amounts had gone out of the income of the respective years. Then without doubt, opening capital as on 01.04.2011, would remain unexplained to the extent of such aggregate drawings and taxes. Commissioner of Income Tax (Appeals) in our opinion fell in error in considering the Balance sheet filed by the assessee alongwith its own return as not factual and incorrect one. An assessee cannot be allowed to approbate and reprobate. It cannot say that its own Balance sheet did not reflect correct state of affairs. Just by claiming that the capital was represented by assets, which were acquired during earlier years, in our opinion an assessee cannot escape from its onus of explaining the source of such capital. In the facts and circumstances, we are of the opinion that ld. Assessing Officer was justified in making the addition for unexplained capital, drawings and taxes paid. Judgment of Hon’ble Jurisdictional High Court in the case of C. Packirisamy [2008 (12) TMI 190 - MADRAS HIGH COURT] does enable an Assessing Officer to make an addition for deficit in opening capital. The additions made by the ld. Assessing Officer, are all reinstated. Order of the ld. Commissioner of Income Tax (Appeals) is set aside. Appeal of the Revenue is allowed.
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