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TMI Blog2010 (7) TMI 1025X X X X Extracts X X X X X X X X Extracts X X X X ..... wed by the CIT(A)-XX/Kolkata, represents the consolidated amount of deposits and withdrawals of the two undisclosed bank a/cs amalgamated together. But, as suggested in the remand report, the peak credit should be considered for the two undisclosed bank a/cs taken separately." 2. Brief facts of the case are that the assessee filed his return on 08.12.2006, showing therein total income of Rs. 1,28,280/-. The AO observed that during the course of assessment proceedings, that the assessee was having two bank accounts with the HDFC Bank, Salt Lake Branch and one OD Account and they were not disclosed in the income tax return. The AO called for the copies of bank statements for the relevant period from the concerned bank. It was found that mone ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Ld. CIT(a) represent the consolidated amount of deposits and withdrawals of the two undisclosed bank accounts amalgamated together. But as suggested in the remand report, the peak credit should be considered for the two undisclosed bank a/cs. Taken separately. He, therefore, urged before the bench to set aside the order of the Ld. CIT(A) and restore that of AO. 4. On the other hand, the Ld. Counsel for the assessee heavily relied on the order of the Ld. CIT(A) and urged before the bench to confirm the same. 5. We have heard the rival submissions and perused the material available on record. We find that the Ld. CIT(A) while partly allowing the assessee's appeal held that the addition made by the AO on account of deposits in undisclosed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dits represented undisclosed income of the appellant. It was basically the absence of any explanation from the appellant that prompted the AO to add all the credits as undisclosed income. However, during the course of remand proceedings, the submissions of the appellant were duly considered by the AO. The AO has fairly admitted that applying the peak credit method could be the correct way to determine the undisclosed income. But, the AO has suggested that peak credits for both the accounts should be worked out separately and their aggregate should be taken as the undisclosed income. I find no justification in the objection raised by the AO against the amalgamation of the two bank accounts. The amalgamation of all the deposits and withdrawa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rd to show that the amount withdrawn has been utilized by the appellant for any expenses or for any investment. And therefore, the peak credit of Rs. 22,80,206=63 would cover the total deposits and withdrawals in the bank accounts. The decision of the AO to add the aggregate deposits in the bank accounts, without giving benefit of withdrawals made from time to time, is not justified. 4.7 I have carefully considered the various legal pronouncements relied upon by the appellant. They also support the contention of the appellant that only the combined peak credit of the undisclosed bank accounts should be considered as undisclosed income. For, in the case of ACIT vs Loknath Prasad Gupta [IT (SS) A No. 185 & 190/Kol/2003 ], the Hon'ble ITAT, ' ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (SS) A No. 61 & 74/Kol/2003 ], the Hon'ble ITAT, 'C' Bench, Kolkata upheld the combined peak credit method. In this case, the appellant maintained various undisclosed bank accounts. The AO added the entire deposits amounting to Rs. 23,55,26,844/-. The Ld.CIT(A) confirmed the addition only to the extent of the combined peak credit of Rs. 23,92,582/-. The Hon'ble ITAT upheld the decision of the Ld. CIT(A) and observed as under- "The Id. CIT(A) has thereafter observed that since there are debits and credits in the above seized material and since these are regular debits and credits in the accounts and no material has been found to show that the debit/withdrawals have been used for any investment or any expenditure by the assessce, it means ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has held that in ease every deposit is followed by a withdrawal then the peak credit only covers the total deposit and withdrawal made by the assessee and the same can be treated as unexplaind investment by the assessee". 4.8 In view of the above and the various legal pronouncements and also the ratio laid down by the Hon'ble ITAT, Kolkata, the addition made by the AO on account of deposits in undisclosed bank accounts is directed to be restricted to the combined peak credit of Rs. 22,80,206.63. Ground no. 2 is partly allowed." In this view of the matter, and in the absence of any controverting material brought on record by the revenue at the time of hearing before us, we do not find any infirmity in the order of the Ld. CIT(A) and the sa ..... X X X X Extracts X X X X X X X X Extracts X X X X
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