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2016 (8) TMI 458

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..... it is a running account having cash deposits. No doubt there are some instances which prove that some of the amounts were utilised for monthly credit card bills or repayment of loans but in the absence of any proof that assessee utilised the entire income earned from the business only for payment towards credit cards bills etc., it is not a fit case for making separate addition of ₹ 3,84,400. As regards the unexplained investment in the land, the Ld. CIT(A) has confirmed the addition of ₹ 1,35,644 for which the assessee could not furnish any evidence. Under these circumstances, we are of the view that the addition of ₹ 1,35,644 sustained by the Ld. CIT(A) is in accordance with law. In short, the cash loans taken from 14 persons were rightly added by the A.O. and confirmed by the CIT(A). - ITA.No.1420/Hyd/2015 - - - Dated:- 21-6-2016 - SHRI D. MANMOHAN, VICE PRESIDENT AND SHRI S. RIFAUR RAHMAN, ACCOUNTANT MEMBER For The Assessee : Mr. D.V. Anjaneyulu For The Revenue : Mr. M. Sitaram ORDER PER D. MANMOHAN, V.P. This appeal by the assessee is directed against the order passed by the CIT(A)-V, Hyderabad and it pertains to the A.Y. 2007-20 .....

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..... ained properly since there was no explanation regarding balance cash deposits in the bank on various dates. Having regard to the circumstances of the case, the A.O. came to the conclusion that the entire loan amount from GE Countrywide and City Bank are withdrawn by way of selfcheques which indicates that they have been utilised for some purpose or investment and hence, claim of availability of the amount withdrawn from Bank of Baroda for deposit in Vijaya Bank, as claimed by the assessee, is not tenable. Even with regard to cash loans from 14 parties, the A.O. noticed that none of them maintained any record on transactions and hence, the claim of cash loans from friends and relatives was rejected. Accordingly, he treated the cash deposit of ₹ 4,37,000 and ₹ 3,50,000 as unexplained credit under section 68 of the Act. Even out of the balance amount out of ₹ 11,71,400, the assessee having not given proper explanation the entire amount of ₹ 3,84,400 was treated as unexplained credit. 4.1. Similarly, the A.O. noticed that the assessee purchased land along with his wife at Kothapalli and his share of investment was to the tune of ₹ 11.18 lakhs. Here also .....

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..... e land registration was carried out on the same day. 5.4. Regarding cash deposit of ₹ 4,37,000 on 10th May, 2006, the case of the assessee was, a sum of ₹ 1,82,000 withdrawn from the Bank of Baroda was deposited. Here also considering the proximity of the dates of deposits, the Ld. CIT(A) assumed that cash withdrawn from Bank of Baroda might have been deposited in the Bank account maintained with Vijaya Bank. The remaining amount of ₹ 2,55,000 which was taken as hand loan from 12 persons was held to be not supported by proper evidence, since the assessee has not furnished PAN etc., He also observed in this regard that the assessee has not maintained any cash book for crossverification of these individual transactions. 5.5. With regard to cash deposit of ₹ 3,50,000, the Ld. CIT(A) admitted the source of ₹ 2,97,000 which is withdrawn from Bank of Baroda account and the balance amount of ₹ 53,000, claimed to have been received as hand loan from 2 persons and also out of personal savings was rejected. With regard to balance amount of ₹ 3,84,400, the Ld. CIT(A) observed as under : 4.5. Besides above cash deposits there are several cas .....

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..... wals and date of deposits having been explained, the A.O. is not justified in surmising that the money withdrawn is not available for fresh investment. In this regard, he adverted our attention to pages 4 to 9 and pages 33 onwards. Similarly, with regard to the unexplained investment to the tune of ₹ 1,35,644, the Ld. Counsel for the assessee adverted our attention to pages 27 of the paper book as well as page 32 to submit that the A.O. has made the addition, being difference in investment of ₹ 11.18 lakhs and cash deposits of ₹ 7,87,000, which is not permissible. He also submitted that no enquiry was made by the A.O. to crossverify the confirmation letters furnished by the parties evidencing deposits made with the assessee. 7. On the other hand, the Ld. D.R. strongly relied upon the order passed by the CIT(A) and submitted that the assessee invested a sum of ₹ 11.18 lakhs for purchase of agricultural land and in proof of the source it was mentioned that he had taken loan from financial institutions and from friends and relatives but the genuineness of the same could not be furnished. In this regard, it was submitted that dates of deposit after the date o .....

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