TMI Blog2019 (7) TMI 1369X X X X Extracts X X X X X X X X Extracts X X X X ..... lidity of reassessment proceedings no infirmity in the same. Accordingly the same is upheld. The various decisions relied the assessee are not applicable to the facts of the present case especially when in non of the cases, the assessee was having two PAN numbers.The ground raised by the assessee on the issue of reopening is accordingly dismissed. Addition u/s 68 - cash deposit in bank account - assessee claimed deposit relates to substantial cash withdrawn and out of opening cash in hand - HELD THAT:- The assessee has declared income of ₹ 23,48,906/- which includes agricultural income of ₹ 4,39,876/-. The assessee during the current year has declared an income of ₹ 26,79,460/- after claiming deduction chapter VI-A. I find the assessee during the course of assessment proceedings has also filed the following cash flow statement to substantiate the deposit of cash in the bank account Rejection of the cash flow statement is due to non consideration of the opening cash balance and non consideration of the earlier cash withdrawals which were utilized again for deposit in the bank account. As find from the assessment order that the AO had presumed that the earli ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... see about the source of cash deposits and the assessee explained that there was an opening cash balance as on 01.04.2009 of ₹ 10,82,297/- and agriculture income of ₹ 9,00,500/-. The assessee also filed the cash flow statement in which it was shown that the assessee had withdrawn ₹ 23,55,000/- from the bank account. The AO did not give the benefit of opening cash balance of ₹ 10,82,297/- and redrew the cash flow in the assessment order. After treating some of the entries of cash deposits as explained the AO treated cash deposits amounting to ₹ 13,13,000/- as unexplained. 3. Before CIT(A) the assessee apart from challenging the addition on merit challenged the validity of the reassessment proceedings. However, the Ld. CIT(A) was not satisfied with the arguments advanced by the assessee on both the issues. So far as the ground challenging the validity of reassessment proceedings are concerned, he decided the same against the assessee by observing as under :- 5.1 The AO had reopened the assessment u/s 147 of the Act on the basis of AIR information that the appellant has made cash deposits of ₹ 60,55,000/- in his savings ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sits of ₹ 60,55,000/- in his savings bank account and the appellant has not filed the Return of Income for AY 2010-11. The AR has challenged the reopening of the assessment by stating that the actual cash deposits amounted to ₹ 34,22,000/- and the appellant has duly filed the Return of Income u/s 139(1) of the Act on 26.07.2010. In view of this, it is contended that the reopening of the assessment was based on incorrect information and therefore, the reopening proceedings should be quashed. A perusal of the reasons recorded by the AO shows that the reopening of the assessment was done with respect to the other PAN held by the appellant which is AKOPB2313B and the Return of Income was being filed by the appellant using the PAN AAHPB3067B. Since the AO had information related to the other PAN not being used by the appellant for filing of Return of Income and it was the duty of the appellant to surrender the duplicate PAN, it cannot be said that the AO had reopened the assessment based on wrong information. The AO had done due verification with respect to the other PAN. and had found that no Return of Income was filed for that PAN. In view of this, I don t find any reason ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ening of the assessment has been done on incorrect facts in a mechanical manner and without verification of facts, therefore, the reopening is bad in law. 7. He submitted that the reopening has been made on borrowed satisfaction which can lead to reasons to suspect but cannot be considered as reasons to belief. There was no tangible or credible material to form a reason to believe that cash deposit represented income of the assessee. There can be number of sources of cash deposits in the bank account. Relying on the following decisions he submitted that the reopening is bad in law and should be quashed. 1. Munni Devi Vs. ITO Rewari, ITA No.3534/Del/2014 2. Harmeet Singh Vs. ITO, Delhi ITA No.1939/Del/2016 3. Bir Bahadur Singh, 68 SOT 197 4. Praveen Kumar Jain Vs. ITO, ITA No.1331/Del/2015 5. Sh. Mahavir Prasad Vs. ITO Rewari, ITA No.924/Del/2015 8. So far as the merit of the case is concerned he submitted that the assessee during the course of assessment proceedings as well as appeals proceedings had furnished the date wise details of cash withdrawn and cash deposit. However, it ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sment. While doing so he had observed that no return has been filed by the assessee for A. Y.2010-11 which is discernable from the copy of the reasons placed at paper book pages 4 5. It is also an admitted fact that the assessee was having two PAN numbers, the reason of which is best known to the assessee. When the Assessing Officer had information related to the other PAN number not being used by assessee for filing of return of income, and since the assessee has not surrendered the duplicate PAN, therefore, it cannot be said that the Assessing Officer reopened the assessment based on wrong information. I find the Assessing Officer in the instant case had done due verification with respect to the PAN number and had found that no return of income was filed in that PAN. In view of the above and in view of the detailed reasoning given by the CIT(A) while upholding the validity of reassessment proceedings, I do not find any infirmity in the same. Accordingly the same is upheld. The various decisions relied by Ld. Counsel for the assessee are not applicable to the facts of the present case especially when in non of the cases, the assessee was having two PA ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 4,645 Total Cash Inflow during the year 4,374,297 Total cash flow during the year 3,694,355 Closing Balance of cash in hand as on 31.03.2010 679,942 13. I find the basis of rejection of the above cash flow statement is due to non consideration of the opening cash balance and non consideration of the earlier cash withdrawals which were utilized again for deposit in the bank account. I find from the assessment order that the Assessing Officer had presumed that the earlier cash withdrawals were consumed for house hold expenses and not available for re-deposit. This, in my opinion, cannot be accepted in absence of any evidence with the AO that the assessee has infact consumed such huge cash and incurred huge expenditure for some other purpose such as any capital expenditure or for some marriage function in the family etc. Further when the assessee is showing huge income and also having agricultural income in the preceding years as well as during the current year, therefore, non consideration of the ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
