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2016 (12) TMI 746 - AT - Income TaxUnexplained cash deposits - applicability of peak theory - Held that:- The source of deposits of ₹ 7,74,000/- by the assessee were from his past capitals, past savings, recoveries from debtors (as proving that assessee showing interest income), withdrawals from the banks during the year and receipts from business. Since we have held above that the all the money deposited amounting to ₹ 29,88,000 in the two bank accounts belong to the assessee, the above explanation regarding source of such deposits thus has to be seen and examined in context of deposit of ₹ 29,88,000. However, we find that there is no finding by the AO in this regard. We therefore, set-aside the matter to the file of the AO to examine a fresh the source of cash deposits in the appellant’s bank accounts taking into consideration the above explanation by the ld AR. Where the appellant’s is able to provide appropriate explanation to the satisfaction of the AO, the AO will provide appropriate relief to the appellant. In a situation, where the appellant is unable to provide appropriate explanation to the satisfaction of the AO or the AO is not fully satisfied with the appellant’s explanation, given the periodicity of deposits and utilisation of such deposits from time to time, the AO is directed to apply the well-accepted peak theory to determine the quantum of additions in the hands of the appellant. - Decided in favour of assessee for statistical purposes.
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