Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2022 (11) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2022 (11) TMI 1243 - ITAT AHMEDABADUnexplained cash deposit for settling credit card bills - unsatisfactory explanation being given by the assessee of the source of cash so deposited - HELD THAT:- The assessee had explained source of cash deposits as being from his cash on hand, withdrawals made from his bank account in ICICI Bank and SBI Bank. The CIT(A), NFAC surprisingly took no cognizance of this explanation of the assessee at all, and upheld addition for the reason that in assessment proceedings the assessee had given some other explanation of source, as being paid by his friends, who had used his card and this present explanation furnished by the assessee was not sufficient since the assessee had given no valid reason as to why he kept so much in cash, when he was holding bank account. As long as the explanation of the assessee is duly substantiated, the same has to be accepted notwithstanding the fact that a different explanation was offered by the assessee in an earlier point of time. What is relevant is that the assesses explanation is duly substantiated with evidence. Whichever explanation fulfils this criteria is undoubtedly the correct and valid explanation for all purposes. Any other explanation of the assessee is of no relevance. If the assessee is able to demonstrate through evidence, in the appellate proceedings, the source of cash deposits,the same needs to be considered, examined, verified and only then a finding be given on the same. It could not be rejected or dismissed solely for the reason that some other explanation was given in the assessment proceedings. As for the other reason given by the ld.CIT(A) for dismissing assesses explanation that there was no reason for the assessee to keep so much cash with him, thus find the same to be also irrelevant. It is upto the assessee to keep how much cash as he requires, hence, this is not a criterion for making any disallowance in the income tax proceedings. How much cash an assessee keeps cannot be reason for dismissing the explanation regarding payment made in cash. In the present case, the assessee having explained the cash deposits as withdrawals from his bank account, CIT(A) having not found any infirmity in this explanation of the assessee, we see no reason for upholding the addition - Appeal of assessee allowed.
|