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2018 (10) TMI 2012 - ITAT SURATUnexplained cash deposits in bank - assessee is a LIC Agent - HELD THAT:- Where the assessee deposits cash amount to the bank account and failed to submit proper explanation to substantiate the amounts deposited by him then, the Revenue authorities have valid powers to pick up the issue for taxation purposes. At the same time, it is a well-accepted principle of tax jurisprudence that in such cases when the assessee is regularly depositing and withdrawing amounts to the alleged bank account for the purpose of his business or profession activity then, entire amount of deposit cannot be treated as income in the hands of the assessee keeping aside the amounts of withdrawal during the year. In the present case, assessee is a LIC Agent, who is claiming that he received cash amounts as premium from his clients and he deposited the same to the bank account and further made payment to LIC on the instructions of his clients. From the copy of bank account available it is also clear that the assessee is depositing cash and also making payments to LIC and other entities. In this situation, the entire cash deposits cannot be treated as income of the assessee and only peak amount credited to the bank of the assessee, can be treated as income in the hands of the assessee. Therefore, alternative prayer of the assessee is allowed and AO is directed to make the addition of peak amount to the returned income of the assessee on account of cash deposits to his bank account. Decided partly in favour of assessee.
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