TMI Blog2012 (6) TMI 884X X X X Extracts X X X X X X X X Extracts X X X X ..... ing the year for the purpose of cheques to that extent when he has added a sum of ₹ 2750000/- for highest cheque deposit during the year under consideration on a particular date. 3. For that the Ld. Commissioner (A) should have taken the highest peak credit within the meaning of section 68 of the Act at ₹ 27,50,000/- more particularly when the funds to the extent of cash peak credit in cash ₹ 14,57,000/- in the month of May, 2006 was available with the Appellant to induct the same in the accounts being means of account payee cheques or Bank Drafts or pay order as the case may be. 4. For that the cash deposit in Bank account during the year under consideration at ₹ 13727000/- includes the above peak cash credit of ₹ 14,57,000/- and none of those deposits yielded deemed income to your Appellant at ₹ 137270/- in the fact and circumstances of the case of the Appellant and the Ld. CIT(A) has erred in determining the deemed income out of such deposits during the year under consideration. 5. For that the Appellant crave leave to add or adduce any additional ground or grounds at the stage of hearing of this appeal. Grievances of the Revenu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Later on the assessee appeared along with A/R on 21/12/2009. However he fail.d to produce the documents as requisitioned in the overleaf of summons U/S 131 A deposition on oath of the assessee was recorded U/S 131 of the income tax Act on 21/1212009. Vide question no.2 of deposition the assessee was asked to explain the source of fund for cash deposit made in the Centurion Bank of Punjab Limited amounting to ₹ 137270001- with the help of documentary evidence. The assesses replied that n the F.Yr.2006-07 he worked for M/S India Steel and Metal Crafts which paid brokerage to tm He further stated that the said concern asked him to open a bank account with Centurion Bank of Punjab Limited .On introduction of some customers by the assessee for the said Firm cash money was received from MIS India Steel and Metal Crafts which was deposited on various interval in the alleged Bank and thereafter cheques were issued to parties of M/s India Steel and Metal Crafts on various dates valuing to ₹ 5 to 6 lacs or more. However the cheque for commission was deposited in the separate bank named ABN AMRO, Brabourn Road Branch. Further more vide question No.7 of the deposition the ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lf withdraw ₹ 3,75,000/-, etc. 6-7-2006 - Cash deposit ₹ 40,000/- - ₹ 1,30,000/- + ₹ 3,50,000/- Cheques issued No.35871 of ₹ 1,70,000/- No.35872 of ₹ 3,50,000/- etc The above illustrates that the funds are being rotated both by deposit by cheque and withdrawal by cash as well as deposit by cash and issue of cheque and there is little gap between the cash withdrawals, subsequent cash deposits and issue of cheques. Therefore the plea of the appellant for taking peak credit in respect of the deemed income from this transaction has some basis. Thus the submissions of the appellant are being considered. As mentioned above its contention regarding peak credit has merit considering that the withdrawal and deposits in the bank account are being made frequently and in short interval. On the other hand after a peak deposit of cash of 14,65,000/- as on 23.5.2006, the deposits are either by way cheques or as contended by the appellant, cash is being withdrawn through self cheque on one day and again cash is being deposited within a couple of days and cheques are being issued. In this situation benefit of telescoping in respect of cash being deposi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... disclosed before the Department i.e 1% of ₹ 1,37,27,000/-which is ₹ 1,37,270/-. However, regarding the peak credit of cash of ₹ 14,57,000/- which been worked out the benefit of cash withdrawal of ₹ 8000/- on 5-04-2006 is allowed because the withdrawal is before the other cash deposits made subsequently and would be available for these cash deposit. Accordingly the peak cash deposit is taken at ₹ 14,57,000/-. In respect of peak credit against cheque deposits, as discussed above the same is to be taken at ₹ 27,50,000/-. Accordingly the addition is sustained to the extent of ₹ 14,57,000/- + ₹ 27,50,000/- + ₹ 1,37,270/- i.e. ₹ 43,44,270/- (Relief ₹ 93,82,730/-). 5. None of the parties is satisfied. While the assessee is mainly aggrieved that the CIT(A) confirmed the addition for peak cash deposit of ₹ 14,57,000/-, the Assessing Officer s stand is that peak credit theory is not at all applicable on these facts. 6. None appeared for the assessee but we have heard the learned Departmental Representative. We have also perused the material on record and duly considered facts of the case in the light of the appli ..... X X X X Extracts X X X X X X X X Extracts X X X X
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