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Income Tax Officer, Ward 33 (3) , New Delhi Versus Shri Arun Kumar Tiwari

2011 (6) TMI 905 - ITAT DELHI

ITA NO. 4294/Del/2010 - Dated:- 10-6-2011 - SHRI G.E. VEERABHADRAPPA, HON BLE VICE PRESIDENT AND SHRI A.D. JAIN, JUDICIAL MEMBER. Appellant by: Mrs. Anusha Khurana, Sr. DR Respondent by: Shri Y.K. Joneja, CA ORDER PER A.D. JAIN, J.M. This is Department s appeal for the assessment year 2007-08, taking the following grounds:- 1. Ld. CIT(A) has erred in confirming the addition of unexplained cash credits only to the extent of ₹ 1,49,110/- on the ground that peak credit method is the correct m .....

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e the same by the CIT(A) in violation of Rule 46A. 2. Ld. CIT(A) has erred in confirming the addition of unexplained cash credits only to the extent of ₹ 1,49,110/- on the ground that peak credit method is the correct method of determining the income in case of unexplained cash credits and deleting the rest of the addition, when a perusal of a copy of the bank account in question clearly indicates that the peak credit method is inapplicable in this case since the amounts remitted into the .....

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redit method in the case. 2. The AO received AIR information that the assessee had deposited cash of ₹ 12,17,188/- in Kotak Mahindra Bank. On query in the scrutiny assessment proceedings, the assessee stated that he was maintaining cash credit account with Central Bank of India, Bhagirathi Palace branch, since it was not possible carrying cash to and from the assessee s factory at Noida ; that he had maintained a bank account with Kotak Mahindra Bank with at par facility; and that he used .....

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see u/s 68 of the I.T. Act. 3. By virtue of the impugned order, the ld. CIT(A) deleted the addition to the extent of ₹ 10,68,078/-, while confirming the addition to the extent of ₹ 1,49,110/-. 4. Aggrieved, the Department has filed the present appeal. 5. Challenging the impugned order, the ld. DR has argued that the ld. CIT(A) has erred in confirming the addition of unexplained cash credits only to the extent of ₹ 1,49,110/-; that the ld. CIT(A) erred in observing that the peak .....

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s inapplicable, since the amounts remitted into the bank account were immediately withdrawn; that the decision in Jhamatmal Takhatmal Kirana Merchants v. CIT , 152 CTR 311(MP) is squarely applicable, since the statement of crediting and debiting itself shows that there is no question of peak credits involved. 6. The learned counsel for the assessee, on the other hand, strongly relied on the impugned order. 7. Apropos the additional evidence allegedly considered by the ld. CIT(A) at the back of t .....

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heard the parties and have perused the material on record. The assessee is engaged in manufacturing of electrical components. During the year, he had made sales of ₹ 19,33,479/-, declaring profit of ₹ 15,14,940/- and a g.p. ratio of 17.06%. The assessee had deposited cash of ₹ 12,17,188/- in his Savings Bank Account with Kotak Mahindra Bank. Before the AO, he submitted that he was maintaining his cash credit account with Central Bank of India, Bhagirathi Palace Branch; that sin .....

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as per his business requirements. The AO observed that the Savings Bank Account of the assessee with Kotak Mahindra Bank had not been reflected in the assessee s balance sheet; that the cash transactions in the bank had not been even routed through capital account of the assessee, from which it was evident that the assessee had been using the Savings Bank Account for the deposits of income from undisclosed sources. 9. The ld. CIT(A) while restricting the addition to ₹ 1,49,114/- and giving .....

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rtment, on the other hand, has placed reliance on Jhamatmal Takhatmal Kirana Merchants v. CIT (supra). 11. Further, reliance has also been placed on Bhaiyalal Shyam Behari v. CIT 276 ITR 38(All). 12. In ACIT v. Chetan Dass 99 ITR 46(Del), the assessee had advanced loan of three sums amounting to ₹ 30,000/-, in March, 1963. The AO added the amount of ₹ 30,000/- as the assessee s income from undisclosed sources. The Tribunal directed the deletion of this amount, observing that the sum .....

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