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TMI Blog2017 (3) TMI 325X X X X Extracts X X X X X X X X Extracts X X X X ..... e, the initiation of proceedings under Section 147, read with Section 148, is bad and liable to be quashed as the condition and procedure under the statute have not been satisfied and complied with. 3. On the facts and circumstances of the case, the reassessment proceedings initiated by the AO are bad in the eye of law as the reasons recorded for the issue of notice under section 148 are bad in the eye of law and on facts. 4(i) On the facts and circumstances of the case, the Ld. CIT(A) has erred both on facts and in law in confirming the addition of Rs. 9,50,000/- made by AO on account of cash deposit in bank. (ii) That the addition has been confirmed by arbitrarily rejecting the explanation and evidences brought on record by the asse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lturist or farmers, where the sale are either on cash or credit both. Whole of the business is conducted on cash basis. As per assessee, purchases are from farmers and al the sales are made to M/s Neha Wudlam Private Limited. The assessee has not furnished the complete details of parties from where the purchase were made by way of providing complete address of these parties. During the year under consideration, assessee has advanced loan amount to Rs. 9,50,000/- to M/s Neha Wudlam Private Limited, Satya Derve Sharma and Shree Ram Trading Co. Since the assessee has not furnished the source of cash deposit for advancing the loan satisfactorily, the same is treated as assessee's income from undisclosed sources and the same is added to the decl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tated that the cash received and withdrawals after making payment for expenses and creditors deposited in to the bank account and the same was used to advance the loan to the said parties. Hence, he stated that in view of it is crystal clear that the payments are totally out of his business and the results have been accepted by the AO, as the business income has been assessed at Rs. 1,51,580/-, hence, the source of deposit has been explained by the Assessee to the AO. In view of above, Ld. Counsel of the assessee stated that AO has not considered the aforesaid source of deposits, hence, the addition made on this account may be deleted. In order to support his contention he relied upon the following case laws:- - ITAT, Delhi Bench decision ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... total sales made during the year is Rs. 9,46,850/-. Out of this during the year assessee received amount of Rs. 10,87,362/- in cash and Rs. 1,33,221/- vide cheques. I find considerable cogency in the ld. Counsel of the assessee's contention that the cash received and withdrawals after making payment for expenses and creditors deposited in to the bank account and the same was used to advance the loan to the said parties. Hence, it is crystal clear that the payments are totally out of assessee's business and the results have been accepted by the AO, as the business income has been assessed at Rs. 1,51,580/-, hence, the source of deposit has been explained by the Assessee to the AO and addition made on this account is not sustainable in the ey ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , to examine the matter in detail, but then reassessment proceedings cannot be restored to only to examine the facts of a case, no matter how desirable that be, unless there is a reason to believe, rather than suspect, that an income has escaped assessment. {Para 8} In view of the reasons set out above, as also bearing in mind entirety of the case, the reasons recorded by the Assessing Officer, as set out earlier, were not sufficient reasons for reopening the assessment proceedings. Therefore, the reassessment proceedings is quash. As the reassessment itself is quashed, all other issues on merits of the additions, in the impugned assessment proceedings, are rendered academic and infructuous. {Para 10} ITAT Agra Bench in the case of Saraf ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... they are liable to be added as deemed income of an assessee. But mere deposit of an amount alone in the bank account could not lead to an inference that this is liable to be taxed as income and the assessee has not disclosed the same and, therefore, it has escaped assessment. No question had been asked from the assessee before reopening the assessment as to the source of the deposit in the bank account. [Para 17J 8.1. In the background of the aforesaid discussions and respectfully following the precedents, as aforesaid, I delete the addition in dispute and accordingly decide the issue in dispute in favour of the assessee and against the Revenue. 9. In the result, the Appeal filed by the Assessee stands allowed. Order pronounced in the Op ..... X X X X Extracts X X X X X X X X Extracts X X X X
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