TMI Blog2016 (10) TMI 100X X X X Extracts X X X X X X X X Extracts X X X X ..... which the same could be done. This would neither expand the scope of the order passed by the Commissioner(Appeals) nor convert the proceedings into one in which the higher authority could be seen to have held that the additions though justified were made in a wrong assessment year. Secondly, even on merits, the Tribunal has finally concluded against the Revenue that in facts of the case, section 68 cannot be invoked in case of the bank, a view with which we have a strong prima facie agreement. If at all, it was a transaction of depositing the amount by individual depositors, the source of such deposits being M/s. Radhe Finance. Whether such a transaction was genuine, whether the source was properly explained and the creditworthiness of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... IL after claiming deduction of ₹ 58,58,153/u/ s. 80P(2)(a) of the Act. The assessment was finalized u/s.143(3) of the Act on 12.05.2008 determining total income at Rs. NIL after allowing deduction of ₹ 58,58,153/u/ s. 80P(20(a) of the Act. (2) During the course of Assessment proceedings for AY 2007-08, it was found that the Reserve Bank of India has imposed penalty of ₹ 5,00,000/by observing : (i) The bank has opened certain Current accounts i.e. M/s. Nilkanth Enterprises M/s. Nilkanth Corporation, M/s. Bhileshwar Industrial Estate Developers Ltd. M/s. Radhe Finance and 250 Fixed Deposit accounts (on November 15th and 16th 2005) in various names without properly verifying their business activities and obtainin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (2)/BMC/0910 dated 18.12.2009 which is received on 21.12.2009 at 02:30 PM. As regards to the details required by your honour in respect of Name, Addresses, PAN No. etc for the Depositors who have made deposits during the financial year 200506 relevant to the Assessment Year 2006-07 and do not relevant to the above referred asstt. Year i.e. AY :2006-07 and your honour is requested to consider the facts of the case. (5) In view of the above referred facts and legal position, I have reasons to believe that the income in the form of acceptance of 250 FDRs each amounting to ₹ 18,000/aggregating to ₹ 45,00,000/pertains to the period relevant to AY 2006-07, has escaped the assessment. 4. The petitioner raised objections to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Reserve Bank of India. The Assessing Officer confronted the assessee with such developments. He pointed out that in such 250 accounts, amount of ₹ 18,000/each was credited, totalling to ₹ 45 lacs. He called upon the assessee why such sum should not be added as unexplained cash credit in the hands of the bank under section 68 of the Act. The assessee responded to the queries of the Assessing Officer and contended interalia that the deposits were made during the financial year 20052006 relevant to the assessment year 2006-2007 and therefore, in any case, no addition can be made for the assessment year 2007-2008 and that in no case the same can be considered as unexplained cash credit of the petitioner bank. 8. Ignoring such pl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arried the matter in appeal before the Tribunal. The Tribunal by the judgement dated 3.7.2015 rejected the Revenue's appeal. The Tribunal made the following observations : 6. Heard both sides. Records perused. It is evident that the assessee; a financial institution registered under the Gujarat Cooperative Societies Act has explained source of the impugned deposits of ₹ 45 lacs. Rather source of the source as well. The Revenue reiterates the Assessing Officer's findings. It does not rebut the CIT(A)'s findings that the impugned deposits have come from the official liquidator. The assessee supports the CIT(A)'s order. It also submits section 68 does not apply since the impugned transactions have not taken place in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... le in the year 2006-2007 or 2007-2008. Plain question was whether the order of assessment invoking section 68 of the Act in case of the bank was proper or not. That being the question, the Assessing Officer cannot without there being anything further on record, reopen the assessment of the same assessee for an earlier year on the same grounds. His attempt to tax income for the assessment year 2007-2008 by passing order of assessment and his action of reopening the assessment of the same assessee on the same ground for the assessment year 2006-2007, would be incongruent. It may be that the Tribunal upheld the order of the Commissioner(Appeals) on two ground. Firstly, on the ground of additions and also fleetingly on the question of correct y ..... X X X X Extracts X X X X X X X X Extracts X X X X
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