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TMI Blog2016 (9) TMI 1184X X X X Extracts X X X X X X X X Extracts X X X X ..... Appeals) has erred in up holding the disallowances made by the Learned Income Tax Officer of a) Society Charges 29292 b) Electricity Charges 6340 c) Telephone Charges 5000 TOTAL : 51699 The appellant is doing her business of dress designing from her residence and hence part of the expenses like society charges, electricity charges, telephone charges have been debited to the Profit & Loss A.O and are allowable as expenses against the business income and should be allowed. 2) The Learned Commissioner of Income Tax, (Appeals) has erred in confirming Rs. 1618000/- being cash deposit an unexplained cash credits. It is submitted that the cash a/c summary was filed with the assessing officer which consisted of business income and cash deposits out of cash withdrawn from the bank account interest income received in cash the total deposits of cash has been explained so the question of making any additions does not arise and should be deleted." 3. At the outset, the ld. Counsel for the assessee submitted that the assessee is not pressing ground No. 1 and the same may be dismissed as 'not pressed'. The ld. D.R. has also not raised any objection to the afore-sta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dress designing business were received in cash and deposited in the bank accounts . No evidence of any kind had been furnished by the assessee before the AO to substantiate that sale proceeds from parties with respect to dress designing business were deposited in the bank and thus the claim of the assessee that the business receipts had been deposited in the bank accounts was rejected by the AO. The assessee's further claimed that the cash withdrawn from bank was used to deposit the same back to the bank account, the A.O. noted that the assessee had shown several cash withdrawals from her accounts as per the bank summary submitted by the assessee whereas the entries shown by the assessee as cash withdrawals in the bank summary were actually not cash withdrawals. The analysis of relevant entries were made by the AO as under:- SN Name of the Bank Date of withdrawal Amount Narration in bank statement 1 ABN Amro 07-09-2004 2,50,000 ABN Amro Equity Fund 2 ABN Amro 27-09-2004 1,50,000 Inward clearing 3 ABN Amro 07-03-2005 1,00,000 DD/CC issued 4 SCB (549348-5) 02-11-2004 15,000 Cash withdrawal 5 HSBC 08-02-2005 2,50,000 Investment in Franklin India Flexi Ca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed that certain inadvertent mistake crept in the bank summary furnished earlier and on account of these mistakes, as analyzed and highlighted in the assessment order, A.O. had come to the conclusion that cash withdrawals shown in the summary are bogus except Rs. 15000/-. The assessee submitted that it is a fact on record that the assessee is carrying on business of dress designing for the last many years and receipts are in cash which had been explained. The assessee prepared the fresh cash flow statement and submitted before the learned CIT(A) which is as under:- Name of the Bank Cash deposited Cash withdrawn. Std. Chartered Bank A/C No. 549348 Rs.7,41,000 Rs.1,35,000 Std. Chartered Bank A/c No. 064758 Rs.75,000 Rs.1,00,000 ABN Amro Rs.8,02,000 Rs.1,00,000 Citi Bank Rs.22,500 Rs. 3,06,000 Rs.16,40,500 Rs.6,41,000 Gross receipts of profession Rs. 6,77,865 Interest received in cash Rs. 78,094 Opening cash Rs. 5,064 Total Rs.7,61,023 Expenses and withdrawals:- Telephone Rs. 8723/- Salary Rs. 78000/- Conveyance. Rs. 6498/- Misc. Rs. 2434/- Withdrawals Rs. 95320/- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ok / 4-bank statement placed on record) in cash on 12th October, 2004 from Citi Bank whereby there is remark 'Fund Transfer- Intercity cash payments' which is in-fact cash withdrawal by the assessee from the bank and which was wrongly rejected by the authorities below. He also invited our attention to paper book page 5 whereby bank statement is placed on record and submitted that the assessee had further withdrawn an amount of Rs. 15,000/- in cash from Standard Chartered Bank on 02-11-2004 which was accepted by the AO as cash withdrawal . The assessee has also received interest to the tune of Rs. 78,094/- in cash from Mr. Manohar Ahuja which should also be considered while computing cash deposits in the bank and arriving at shortfall of cash in hand to arrive at income to be brought to tax on this count. The ld. Counsel submitted that as per the cash flow statement (paper book page 62), the total cash available with the assessee was Rs. 12,11,048/- and the cash deposited and expended was Rs. 16,40,500/- resulted in shortage of cash to the tune of Rs. 4,29,452/- which could be brought to tax , hence there is no shortage of cash of Rs. 16,18,000/- as alleged by the A.O. in his assess ..... X X X X Extracts X X X X X X X X Extracts X X X X
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