9911796707
TMI Blog2015 (5) TMI 747X X X X Extracts X X X X X X X X Extracts X X X X ..... he provision of Income Tax Act, and therefore liable to quashed. 2. On facts and circumstances of the case and law on the subject, the CIT(Appeals) has erred in confirming the addition of Rs. 33,57,080/- in respect of cash deposits in various bank accounts without taking into account the nature of the business of the appellant and also taking the opening peal balance into account while determining the peak balance available with the appellant." 2. The brief facts qua the issue involved are that, assessee is an individual and has claimed to be in the business of money transfer to various places in the State of Uttar Pradesh from Mumbai. The trade name of the said business was known as "Raj Quick Services". Before the assessing officer, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and the persons to whom the money was distributed or handed over. He further noted that in the two bank account of Bharat Co-op. Bank the assessee has deposited Rs. 26,60,060/- and Rs. 23,62,741/-, aggregating to Rs. 50,22,801/-. Since, the assessee neither furnish any necessary evidence nor appeared before the AO to clarify his accounts, he treated the entire sums deposited in both the accounts as undisclosed income u/s 68. Accordingly, following addition was made as income from undisclosed sources. (a) Deposits in two account of Bharat Co-op. Bank Account Rs. 50,22,801/- (b) Deposit in Canara Bank Account Rs. 43,85,936/- Besides this, he has also taxed the commission income of Rs. 1,23,800/- shown on account of money transfer business ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... us places in UP along with copy of certain demand drafts to show the genuineness of the transaction. The Ld. CIT(A) directed the AO to verify all the relevant bank accounts which has not been disclosed by the assessee in his regular books of account and in the balance sheet. AO was also directed to verify the claim of the assessee regarding transfer of money through banking channel. In the remand report, the AO submitted that assessee had submitted list of five bank accounts, the details of which relevant as under:- Sl No. Name of the Bank Branch Type of account Account no. (i) Canara Bank Sakinaka OD 1208 (ii) Canara Bank Sakinaka SB 27731 (iii) Canara Bank Sakinaka SB 29646 (iv) The Bharat Co-op. Bank Andheri (E) S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd also noted the relevant observation of the AO given in the remand report. He noted that as per the detail finding of the AO and categorical admission of the assessee that no proper details and supporting evidences relating to money transfer business for cash deposit could be furnished, therefore, it cannot be held that the cash deposit should be treated as disclosed receipts. However, Ld. CIT(A) agreed with the alternate contention of the assessee that there had been regular cash withdrawal and cash deposit in the same bank account, therefore, the entire cash deposited cannot be added as undisclosed income. The effect of both debits and credits has to be taken into consideration and peak credit should be added. Accordingly, he held that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... element which is the commission income should be taken as the real income of the assessee. He further submitted that, even peak worked out by the Ld. CIT(A) is not correct, because firstly, the Ld. CIT(A) has not considered the opening balance of Rs. 12,39,133/- which should be removed from the working of peak credit; Secndly, the deposit of his brother's account has also been taken into consideration, while taking the figure of peak credit; thirdly, not only that some of the account with Bharat Co-op bank belongs to assessee's wife and not to the assessee, as on the said bank account is shown in her balance sheet and she is separately assessed to tax. In support of his contention, he drew our attention to assessment order passed u/s 143(3 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... some kind of money transfer business, however, the onus is upon the assessee to correlate the cash deposits with some evidence or the same has been recorded in regular books of account. It is also an undisputed fact that three of the assessee's bank accounts was not disclosed, either in the balance sheet or in the books of account. In such a case ones lies heavily upon the assessee to prove the source of the cash deposits in the bank account. Since there was a regular cash deposits and regular withdrawals from same nature of transaction, then positive peak credit has to be worked out for the purpose of addition which has rightly done by the Ld. CIT(A). Accordingly, the Ld. CIT(A)'s conclusion that peak credit should be added is affirmed. 8 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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