TMI Blog2019 (1) TMI 88X X X X Extracts X X X X X X X X Extracts X X X X ..... sed premises therein, along with bills/vouchers in respect of expenditure incurred towards sub-lease premises which are alleged to have been incurred by assessee. The Ld.AO is then directed to verify the same as per law, and if found genuine as per sub lease agreement entered into by assessee with LIC, may allow the claim of assessee. Addition u/s 68 and section 69 - Held that:- Assessee has placed certain receipts in respect of payments made to some parties. AO has objected to these documents as these are not verified. Assessee has not established that all deposits made in bank accounts were in respect of cancellation of deals as has been alleged by assessee - assessee submitted regarding opening cash balance which was accepted by authorities below in immediately preceding year - direct assessee to produce all the parties with whom deals were cancelled and money has been deposited in bank accounts. AO is directed to take into consideration opening balance appearing in books of accounts of assessee, before verifying identity, creditworthiness and most importantly genuineness of transaction, that has been alleged to have been cancelled, in lieu of which, cash were deposited back ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nsideration the remand report submitted by the A.O. (III) That the appellant, craves, leave to add, amend or modify the ground(s) of appeal at any time. Relief claimed in appeal As per the grounds of appeal the order passed by Ld. CIT(A)-XX, New Delhi be quashed. 2 . Brief facts of the case are as under: Assessee filed its return of income on 30/09/11 declaring income of ₹ 1,04,21,750/-. The return was processed under section 143 (1) of the Income Tax Act, 1961 (hereinafter referred to as the Act ), and case was selected for scrutiny. Representative of assessee appeared before the Ld. AO with whom the case was discussed. Various requirements were requisitioned vide questionnaire and order sheet entries to assessee. 2.1 . It is recorded in assessment order that assessee has claimed to be engaged in leasing business. Ld.AO observed that assessee had taken property on lease from Sh. Ashok J Thapar, which was further sublet. Against sub-leasing, Ld.AO observed that assessee received rental income of ₹ 2,02,35,075/-. Against rental income, assessee claimed various expenses. As assessee failed to produce any supporting evidences, Ld.AO disall ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .Sr.Dr submitted that, all major repairs, like damage of electricity cable, bursting sanitary pipes, cracks etc., was to be done by Lessor therein, being Sh.Ashok J Thaper, and not assessee before us. And that it is difficult to accept contentions of assessee, having incurred all major expenses. Supporting order of Ld.AO, she submitted that Ld.CIT(A) failed to verify agreements before granting relief to assessee. She further casted heavy doubt on the expenses incurred by assessee which has been claimed against the rental income. Assessee has not filed any bills or vouchers in respect of huge expenses claimed for year under consideration, for which business purpose has not been proved, as required under section 37 (1). 4.2. Ld.AR on the contrary, submitted that, assessee is also having money lending activities, against which, expenses were incurred for year under consideration. He submitted that Ld. CIT (A) correctly observed that Department has accepted money lending activity carried on by assessee in the preceding Assessment Years and admittedly interest income were treated as business income of assessee, against which various expenditure were debited by assessee. 5 . ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... into by assessee with LIC, may allow the claim of assessee. Accordingly we set aside ground No. 1 to Ld. AO for due verification as per law. 6. Ground No. 2 has been alleged by revenue against deleting the addition made by Ld.AO under section 68 and section 69 of the Act. 6.1 . Addition under section 68 Ld. Sr.DR submitted that as per the AIR information cash deposits has been made by assessee in bank on various dates for which assessee has not offered any explanation. She further submitted that from the cash book placed before the Ld. AO it has been recorded that assessee was having cash in hand of ₹ 1,55,39,251/- for which the source has not been explained by assessee. Ld.Sr.DR further submitted that from the bank statement filed by assessee Ld. AO has observed cash deposits on various dates amounting to ₹ 46,37,820/-for which again no explanation were provided. She submitted that before Ld. AO, assessee failed to submit an explanation of the source of cash in hand and also could not substantiate that reasons for withdrawals of such cash claimed to be cash in hand. She submitted that before the Ld.CIT(A) assessee submitted additional evidence regardi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ess of transaction, that has been alleged to have been cancelled, in lieu of which, cash were deposited back into the accounts. 7.2 . Insofar as the withdrawals are concerned assessee is directed to reconcile the statement of withdrawals with deposits into bank accounts maintained by assessee. In the event the co- relation of withdrawals with the deposits is successfully made by assessee in terms of the deals that has been cancelled, no further enquiries need to be made by Ld. AO. On the contrary, if there are certain cash in hand/deposits in bank, for which there is no corresponding withdrawal, assessee is directed to establish source of such cash/deposits in the bank to the satisfaction of Ld. AO as per section 68 of the Act, which means assessee is directed to establish identity, creditworthiness and most importantly genuineness of cash deposited in bank as well as cash in hand. Ld. AO shall then verify the same as per law. With these directions we set aside this ground to Ld. AO . 8. Addition under section 69 It is observed that assessee had made certain term deposits and since during assessment proceedings, no information was provided by assessee and the same ..... X X X X Extracts X X X X X X X X Extracts X X X X
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