TMI Blog2021 (5) TMI 98X X X X Extracts X X X X X X X X Extracts X X X X ..... the bank accounts of the assessee, and not in any 'books' of the assessee for the year under consideration. In the backdrop of the aforesaid settled position of law, the addition made by the A.O in respect of the cash deposits in the bank accounts of the assessee by invoking Section 68 has to fail, for the very reason that as per the judgment in the case of CIT Vs. Bhaichand N. Gandhi [ 1982 (2) TMI 28 - BOMBAY HIGH COURT] , a bank pass book or bank statement cannot be considered to be a 'book' maintained by the assessee for any previous year for the purpose of Section 68 - on this count itself the impugned addition made and sustained deserves to be deleted and we direct to delete the same. No such addition could have been validly made u/s 68 of the Act, therefore, we refrain ourselves to decide the other grounds wherein the assessee has assailed on merits the additions sustained by the ld. CIT(A) - Appeal of the assessee is allowed. - ITA No. 13/JP/2020 - - - Dated:- 28-1-2021 - Shri Sandeep Gosain, JM And Shri Vikram Singh Yadav, AM For the Assessee : Shri Rajiv Khandelwal (CA) For the Revenue : Smt. Monisha Choudhary (Addl.CIT) ORDER PER: ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s filed before the Bench and the same is reproduced below: 5.1.1 The appellant under section 44AA of the Act is not required to maintain books of account; thus, the Assessing Officer could not have made addition under section 68 of the Act. 5.1.2 Section 68 is a deeming section fastening liability on the subject and hence, should be strictly construed. 5.1.3 The pre-requisites for invoking the provisions of section 68 are- (i) any sum is found credited in the books of an assessee (ii) the assessee offers no explanation about the nature and source thereof (iii) the explanation offered by him is not, in the opinion of the Assessing Officer, satisfactory. 5.1.4 The pre-requisite for invoking the provisions of section 68 is the credit entries in the books of account of the assessee. In the case on hand, the credit is in the bank statement and not in the books of account of the appellant. As the appellant is not required to maintain books of account under section 44AA of the Act, the Assessing Officer has fallen in error in invoking the provisions of section 68 of the Act. Reliance is placed on the decision of Bombay High Court in the case of Bhai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urther, the CIT(A) and the Assessing Officer, for not allowing credit for opening cash balance, have merely observed that household expenses are not shown in the cash flow statement of the earlier year and hence, stated that the opening cash balance is not available. The appellant submits that his wife, Mrs Mahendra Gupta, though a homemaker has some earnings which is utilised for household expenses-refer acknowledgement evidencing filing of return of income for income-tax assessment years 2012-13 to 2014-15 of Mrs Mahendra Gupta page nos 2 to 9. In view of the above, the CIT(A) and the Assessing Officer has fallen in error in considering ₹ 3,38,000, being the opening cash balance as unexplained cash credit under section 68 of the Act and hence, the same needs to be deleted. 6.2 Cash gift from son ₹ 75,000 (a) The CIT(A) confirmed the action of the Assessing Officer in making addition of ₹ 75,000 as unexplained cash credit in respect of the gift received by the appellant from his son, Mr Vivek Gupta, a non-resident Indian. (b) The appellant submits that - (i) During the year, the appellant has received a gift of ₹ 75,000 from his son ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he assessee. Though, it remains as a matter of fact that the bank account of an assessee is the account of the assessee with the bank, or in other words the account of the assessee in the books of the bank, but the same in no way can be held to be the books of the assessee. We have given a thoughtful consideration to the scope and gamut of the aforesaid statutory provision of Section 68, and are of the considered view that an addition made in respect of a cash deposit in the bank account of an assessee, in the absence of the same found credited in the books of the assessee maintained for the previous year, cannot be brought to tax by invoking the provisions of Section 68 of the Act. In this respect, we draw strength from the decision of the Hon ble Bombay High Court in the case of CIT Vs Bhaichand N Gandhi (1983) 141 ITR 67 (Bombay) wherein the High Court has held as under:- As the Tribunal has pointed out, it is fairly well settled that when moneys are deposited in a bank, the relationship that is constituted between the banker and the customer is one of debtor and creditor and not of trustee and beneficiary. Applying this principle, the pass book supplied by the bank t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... construed to be a book maintained by the assessee for any previous year as understood for the purposes of section 68 of the Act. Therefore, on this account itself the impugned addition deserves to be deleted. I hold so. We further find that a similar view had also been arrived at in a 'third member' decision of the Tribunal in the case of Smt. Madhu Raitani Vs. ACIT (2011) 10 taxmann.com 206 (Gauhati) (TM), as well as by the coordinate Benches of the Tribunal in the case of Mehul V. Vyas Vs. ITO (2017) 164 ITD 296 (Mum) and ITO, Barabanki Vs. Kamal Kumar Mishra (2013) 33 taxamann.com 610 (Lucknow). 10. We find that as stands gathered from the records, the addition aggregating to ₹ 4.03 lacs sustained by the ld. CIT(A) is in respect of the cash deposits in the bank accounts of the assessee, and not in any 'books' of the assessee for the year under consideration. We thus are of the considered view that in the backdrop of the aforesaid settled position of law, the addition made by the A.O in respect of the cash deposits of ₹ 7,13,000/- in the bank accounts of the assessee by invoking Section 68 has to fail, for the very reason that as per the judgme ..... X X X X Extracts X X X X X X X X Extracts X X X X
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