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2017 (11) TMI 570 - HC - Income TaxUndisclosed deposits - addition of unexplained income in the hands of the assessee - Held that:- Only reliance of one bank account which has been opened by the assessee company and various authority letters given to Mr. Mayur M. Thakkar cannot be the basis to draw an inference that whole of the income accrue and arise in the hands of the assessee company. This matter should further have been seen and considered in the context of probabilities and possibilities of having earned any income by the assessee company from these transactions, being based at Jaipur and carrying out such transactions in Bombay wherein no such blank authorities given to Mr. Mayur M. Thakkar was required in case he could have been carrying out these transactions regularly in Bombay. Thus the assessing authority has wrongly assessed and ld. CIT(A) has wrongly upheld the deposits as additions being unexplained income in the hands of the assessee. Also in case it is considered that all these transactions have been carried out by the assessee company and deposits and making out of drafts and carrying out all these business is a part of the work carried out by the assessee company and these deposits are considered as cash deposits in the bank account then there cannot be any assessment more than the amount of peak credit for both the years being a block period which does not exceed more than 10 lakhs. In no case there can be 100% assessment on the total deposits as an income and cannot be considered as undisclosed income of the block period - Decided in favour of assessee.
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