9911796707
TMI Blog2015 (2) TMI 1237X X X X Extracts X X X X X X X X Extracts X X X X ..... ank account. 3. Briefly, the facts are that the assessee filed return of income at Rs. 1,40,950/-. The main source of income of the assessee is "income from profit and gains from business". The assessee is a wholesale trader of ball bearings and machinery parts. The assessee has declared net profit of Rs. 2,00,944/- from sales of Rs. 39,00,875/-. As per the balance sheet, the assessee is maintaining a cash credit account with Oriental Bank of Commerce, Rajpura. The assessee was to furnish details of the bank account maintained by him either individually or jointly with any other person. The assessee furnished copies of three bank accounts maintained by him; i) Cash credit bank account maintained with Oriental Bank of Commerce, Rajpura; ii) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Officer noted that the perusal of the same shows that there is credit entry of Rs. 3010/- on 31.3.2008 in the miscellaneous income account with the narration indicating transfer of the amount from Kotak Mahjindra Bank, Rajpura. As per bank statement obtained from the bank, there is credit closing balance of Rs. 5,988/-, against which there has to be debit balance as per assessee's books of account. The Assessing Officer found that there are various cash deposits totaling Rs. 17,35,200/- in this bank account in the year under consideration. Each deposit is less than Rs. 50,000/-. Same amount as deposited in cash has been withdrawn immediately thereafter either on the same day or the next day. All the entries appearing in the bank statement ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arned representatives of both the parties and perused the material available on record. The learned counsel for assessee reiterated the submissions made before the authorities below and submitted that copy of Kotak Mahindra Bank Account, Rajpura would show that the amounts were deposited in the bank account and also withdrawn the same were shown in the cash book also. Therefore, it was the rotation of money of the assessee only and since the assessee did not maintain any regular books of account and income was offered in the return of income under section 44AF of the Act. Therefore, the assessee need not to maintain books of account and addition is, therefore, wholly unjustified. He has relied upon the decision of the Hon'ble Punjab & H ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Assessing Officer also noted the fact that the amount deposited in cash in this bank account has small deposits as well as withdrawal of the cash immediately either on the same day or the next day of the deposits. The Assessing Officer also noted that all the entries appearing in the bank statement have been put by the assessee in cash book also, though the Assessing Officer disbelieved the entries contained in the cash book and considered it to be an after thought. In this background, it is clear that the assessee is a retailer and filed return of income with the aid of section 44AF of the Act. Therefore, the assessee need not to maintain any regular books of account. It is a fact that in the assessment year under appeal the assessee made ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... evidence on record to prove that the assessee has spent the amount withdrawn somewhere else. The theory of peak credit is not applicable in the case of the assessee because the assessee never accepted it to be unexplained money. Therefore, in the absence of complete details and considering the fact that the amount of cash was rotating in the bank account of the assessee with Kotak Mahindra Bank, Rajpura by making cash deposits and immediately withdrawing the same would show that the entire cash deposits in the bank account may not be unexplained amount of the assessee. Therefore, considering the totality of the facts and circumstances, it would be reasonable and proper to give some substantial benefit to the assessee for the purpose of del ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rtently the assessee has maintained wrong figure in the income tax return of the closing stock. Therefore, on such basis, the addition need not to be made against the assessee. Further when income is declared on presumptive basis under section 44AF of the Act, no further trading addition should be made against the assessee. We accordingly, set aside the orders of the authorities below and delete the addition of Rs. 3,07,790/- The ground No.3 of the appeal of the assessee is, therefore, allowed. 11. On ground No.4 the assessee challenged charging of interest under section 234B of the Act, which is mandatory and consequential in nature. This ground of appeal of the assessee is, therefore, dismissed. 12. On ground No.5 the assessee challenge ..... X X X X Extracts X X X X X X X X Extracts X X X X
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