TMI Blog2015 (4) TMI 1095X X X X Extracts X X X X X X X X Extracts X X X X ..... nfirmations from Jayshreeben Parmar, Chandan Parmar, Hansaben Parmar and Bhudarji Mithal. However, the assessee has not furnished the proof of creditworthiness of such creditors. Therefore, the ld.CIT(A) was not justified in deleting the addition being the loan received from friends and relatives without any supporting evidences of the creditworthiness of such creditors. Further, the ld.CIT(A) observed that there was an opening cash balance of ₹ 10 lacs which he presumed that amount might have been used for depositing in the bank account. Before us, the assessee could not point out as to whether the amount of ₹ 10 lacs shown as cash on hand related to the account declared by the assessee. These accounts are not the recorded accounts. The assessee was required to demonstrate with evidence as to how this cash was generated. Therefore, we cannot affirm the order of the ld.CIT(A), same is hereby set aside. The ld.CIT(A) ought to have passed a speaking order in respect of genuineness of the transactions and creditworthiness of depositors. It is also not clear whether the transactions in question had been reflected by other persons or not in their respective books of acco ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tiny assessment and the assessment u/s.143(3) of the Income Tax Act,1961 (hereinafter referred to as the Act ) was framed vide order dated 24/12/2009. While framing the assessment, the Assessing Officer (AO in short) made addition of ₹ 38,95,184/- on account of unexplained cash credit/bank deposit and investment in various securities by the assessee from undisclosed bank accounts by invoking the provisions of section 69 of the IT Act. Against this, assessee filed an appeal before the ld.CIT(A), who after considering the submissions of the assessee restricted the addition to the extent of ₹ 10,99,109/-. The ld.CIT(A) further directed the AO to re-examine the case from the angle of reopening the of AY 2006-07 in order to bring the opening cash balance of ₹ 10 lacs and opening bank balance in these bank accounts of ₹ 2,07,231/- under the purview of taxation. Aggrieved by the order of the ld.CIT(A), the Reve4nue is in appeal before us. 3. Grounds Nos.1 to 3 are inter-connection and, therefore, the same is decided together. The ld.Sr.DR Shri Nimesh Yadav vehemently argued that the ld.CIT(A) failed to appreciate the fact that the assessee had not disclosed the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ative cash balance of ₹ 5,37,000/= on 30-11-2006 which was the peak amount of negative balance suggesting the unexplained cash deposit. Since a substantial cash was withdrawn during the earlier year, there is a reason to believe that the same could have been on hand with the appellant which might have been applied by way of deposition in the current year. However, the fact remains that all these accounts were operated in earlier year also and therefore, when the contention of the appellant about cash on hand is to be accepted, then it is also required to reopen the assessment of the earlier year i.e. A.Y. 2006-07. In short, it can be concluded that the appellant has satisfactorily explained the source to the tune of ₹ 10,00,000/= being the opening cash balance and reapplication of ₹ 14,78,000/ = being withdrawals of current year. However, the negative balance of ₹ 5,37,000/= in current year's cash book remains unexplained and therefore, that must be treated as unexplained investment in form of cash deposit. Also, there was an opening balance of ₹ 2,07,231/ = in aggregate in these bank accounts which cannot be treated as unexplained investment of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... c. Loans from friends and relatives 6,47,847 d. Opening bank balance in the impugned bank accounts, subject to further direction hereinafter 2.07.231 33,33,078 5,62,109 Add : Negative balance found in cash book on 30-11-2006 5,37,000 Total addition sustained 10,99,109 4.1. There is no dispute with regard to the fact the account Nos.9427,61506, 61175 61095 with the Surat Peoples Co-operative Bank Ltd., Bhgatalao Branch, Surat, were not disclosed by the assessee to the Income Tax Department while filing the return. The explanation of the assessee in respect of these accounts was that the accounts were jointly held with other persons and the amount credited therein was out of the savings, loan and maturity of mutual funds. In our considered view, if any, credit entries found in the accounts of the assessee, it is incumbent upon him to explain the source of such credit. In the present case, the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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