TMI Blog2005 (2) TMI 103X X X X Extracts X X X X X X X X Extracts X X X X ..... reference relates to the assessment year 1979-80. Briefly stated, the facts giving rise to the present reference are as follows: The respondent is being assessed to income-tax in the status of a registered firm. It is engaged in the manufacture and sale of agricultural implements and iron scrap, etc. For the assessment year in question, the Assessing Officer had noticed certain cash credits in the squared up accounts. He required the assessee-respondent to prove the genuineness of the deposits whereupon the respondent filed only confirmatory letters and did not produce any other evidence in support of the cash credits. It may be mentioned here that the Assessing Officer had noticed the following cash credits in the squared up accounts ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2,000 9. Halke 1,200 10. Hussain Mohd. 2,500 11. Muniuddin 2,500 12. Amit Deo 1,500 ------ 23,200 ------ It may be mentioned here that in respect of Sri Paras Ram Numberdar he has made an addition of Rs. 2,000 treating the said amount to be the peak credit. In respect of Mahesh Chandra Jain, the addition was only Rs. 2,000 being peak credit. Feeling aggrieved, the respondent preferred an appeal before the Appellate Assistant Commissioner who has upheld the additions. Still feeling aggrieved, the respondent pref ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent-assessee. We find that in respect of the squared up accounts of the two depositors, mentioned above, the Assessing Officer himself had taken the peak credit as unexplained deposit and added the same under section 68 of the Act. So far as the remaining deposits are concerned, there was no transaction between the depositors and the respondent-assessee. This court in Income-tax Reference No. 226 of 1998, Bhaiyalal Shyam Behari v. CIT [2005] 276 ITR 38 decided on January 19, 2005, has held that the principle of peak credit is not applicable in case where the deposits remained unexplained under section 68 of the Act. It cannot apply in a case of different depositors where there has been no transaction of deposits and its repayment betwee ..... X X X X Extracts X X X X X X X X Extracts X X X X
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