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TMI Blog2019 (7) TMI 872X X X X Extracts X X X X X X X X Extracts X X X X ..... g the additions made on account of unexplained cash credits, has overlooked the sworn statement dated 7/8/2015 of Shri Rajendra Babu K.V. in whose name the bearer cheques was issued in most of the cases where in it was admitted that the signature on the bearer cheques belongs to him and the money was withdrawn as per the instructions of Shri A. Jayakrishnan, for the purpose of Hotel construction which was going on at Hotel Vysali. 3) The CIT(A) has erred in accepting the copy of the certificate obtained from the Thodupuzha Municipality, issued at a later date, stating that no hotel or commercial building construction was going on at Thodupuzha, during the period from 1/4/2011 to 31/3/2014, without verification of the same. 3. The facts of the case as narrated in ITA No. 559/Coch/2018 are that search revealed large financial dealings between Shri, Sunil Kumar of Kollam and the assessee. The assessee had accepted the following loans from the concerns belonging to Shri Sunil Kumar @ Sunil Swamy. Date A.Y Concern Amount . 15.09.2011 2012-13 Sabari Quality Foods Rs. 2,00,00,000/- 03.10.2011 2012-13 Sabari Quality Foods Rs. 1,44,00,000/- 21.10.2011 2012-13 Sa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Rs. 25,00,000/- 17.09.2011 ING Vysya A/c 15531 Rs. 25,00,000/- 17.09.2011 ING Vysya A/c 15531 Rs. 25,00,000/- 17.09.2011 ING Vysya A/c 15531 Rs. 25,00,000/- 26.09.2011 ING Vysya A/c 15531 Rs. 50,00,000/- 01.10.2011 ING Vysya A/c 15531 Rs. 25,00,000/- 03.10.2011 ING Vysya A/c 15531 Rs. 20,00,000/- 08.10.2011 ING Vysya A/c 15531 Rs. 24,00,000/- 22.10.2011 ING Vysya A/c 15531 Rs. 6,00,000/- 30.12.2011 Kumaly gate Rs. 6,00,000/- 23.01.2012 ING Vysya A/c 15531 Rs. 10,00,000/- 25.01.2012 ING Vysya A/c 15531 Rs. 4,00,000/- 26.01.2012 Wingspark Hotel Rs. 10,00,000/- 14.02.2012 ING Vysya A/c 15531 Rs. 10,00,000/- 14.02.2012 ING Vysya A/c 15531 Rs. 15,00,000/- 01.03.2012 ING Vysya A/c 15531 Rs. 15,00,000/- 01.03.2012 ING Vysya A/c 15531 Rs. 15,00,000/- 01.03.2012 ING Vysya A/c 15531 Rs. 20,00,000/- 30.03.2012 ING Vysya A/c 15531 Rs. 49,00,000/- 31.03.2012 Agricultural income Rs. 6,00,000/- L Rs. 6,44,55,000/- 3.3 The Assessing Officer noticed that whereas the assessee did not have books in fish business and claimed to be earning only commission from the fish business, faced with the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Bar Hotel 14.02.2012 ING Vysya 15531 Rs. 15,00,000/- For Construction of Bar Hotel 01.03.2012 ING Vysya 15531 Rs. 15,00,000/- Amount Drawn for Construction of Bar Hotel 01.03.2012 ING Vysya 15531 Rs. 20,00,000/- Cash Drawn for Bar Hotel construction 30.03.2012 ING Vysya 15531 Rs. 49,00,000/- Hotel Vysali Thodupuzha 31.03.2012 Agricultural income Rs. 6,00,000/- Rs. 6,44,55,000/- 3.4 From the above, the Assessing Officer noticed that out of the cash claimed to have been introduced in the books of the Fish Business by withdrawing from the Bank, Rs. 3,17,00,000/- was withdrawn for the purpose of construction of a bar hotel at Thodupuzha which was evidenced by the copies of cheques obtained from the Bank and hence, the cash deposits amounting to Rs. 3.17 crores were held to be unexplained and treated as the income of the assessee. The Assessing Officer rejected the contention of the assessee that there was no hotel construction during the year and the staff in the Bank might have recorded the narration in the cheque. The assessee further enclosed a certificate from the Secretary, Thodupuzha Municipality stating that h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion. 4.1 Similarly, for the assessment year 2013-14, on identical reasons, the CIT(A) deleted the addition of Rs. 1.62 crores on account of cash withdrawal from own bank account. 4.2 For the assessment year 2014-15, addition was made for an amount of Rs. 52,25,000/- on account of cash withdrawal from Bank account, The A.O. observed that as per the narration at the back of the withdrawal slip, the cash was withdrawn for paying bar license fee and this was an unexplained expenditure of the assessee. It was contended that the assessee had no bar license in his name and no such fees were paid by him. On identical reasons, the CIT(A) deleted the addition of Rs. 52,25,000/- on account of cash withdrawal from the Bank account. 5. Against this, the Revenue is in appeal before us. The contention of the Ld. DR is that there is evidence to show that the assessee has used the amount withdrawn from Bank for the construction of Hotel Vysali in Thodupuzha which was reflected in the back side of the cheque. However, the CIT(A) solely based on the certificate issued by the Secretary, Thodupuzha Municipality deleted the addition by observing that there was no construction of commercial building ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ank account was examined. However, it was submitted that the assessing officer without any verification or without bringing any evidence or material on record mechanically treated the utilization of the cash as unexplained credits and brought the same and assessed the same by invoking section 69 of the Act. 6.2 As regards, the addition of Rs. 52,25,000/- for the assessment year 2014-15, the assessee clearly explained that the withdrawal of Rs. 52,25,000/- was for payment of Bar License Renewal Fees and the same was utilized for that purpose as per the cash book. It was submitted that the assessing officer had mechanically added the amount by relying upon the copies of cheques obtained from Bank and the addition was misconceived since the expenditure is treated as income when the source is from bank withdrawal. 6.3 It was submitted that the assessing officer also disallowed part of the interest claim for the asst. year 2010-11 and the assessee's appeal against these disallowances were dismissed and additions were sustained by the CIT(A). Against this order, no second appeal has been filed by the assessee. 6.4 Similarly, for the asst. years 2011-12 to 2014-15, the CIT (A) also ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the said hotel was owned by the assessee and two more partners and not by the assessee himself. The building was taken on rent and no construction work has been carried out at the said hotel. For this purpose, he relied on the certificate issued by Secretary, Thodupuzha Municipality. However, we find that each entry in the cash book for introduction of cash was not at all explained by the assessee. The assessee made a general statement that there was no construction activity at Hotel Vysali and the amount was available for introduction into the cash book. In our opinion, the assessee has to explain each entry in the cash book. The Assessing Officer has to prove that if there is construction activity, how much amount has been spent for construction activity at the said hotel after providing opportunity of cross-examination of the person whose statement was relied on by the Assessing Officer for making such additions for these assessment years under consideration. With this observation, we remit the entire issue in dispute in all these appeals to the file of the Assessing Officer for fresh consideration. This ground of appeals of the Revenue is partly allowed for statistical purpose ..... X X X X Extracts X X X X X X X X Extracts X X X X
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