TMI Blog2022 (6) TMI 1114X X X X Extracts X X X X X X X X Extracts X X X X ..... deposit of Rs. 94,50,000/- is the cash withdrawn of Rs. 1,02,75,000/- on various dates during the year itself which were before the announcement of demonetization scheme on 08.11.2016. The first observation of the Revenue authorities that why the assessee kept the funds idle with it for few months seems to have no merit in our view as it is the prerogative of the assessee company to utilize its funds in the way it finds prudent to be done so in the interest of running a business. We do not find anything unusual of the assessee keeping the cash in hand idle with it which was withdrawn from the bank and shown in the cash book. The second interesting observation by the ld. AO is that the denomination of currency withdrawn from Tamilnad Mercantile Bank do not tally with the denomination of the currency deposited in Union Bank of India. Though this allegation of the ld. AO made on the basis of information received by the ld. AO from bank u/s 133(6) of the Act was not provided to the assessee, thereby, denying the principles of interest of justice in not providing the assessee an opportunity to cross examine the information gathered by the ld. AO in the bank of the assessee and thi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... when the income by way of sales realization of shares stood deposited in the bank account has been accepted by the Ld. A.O. to be the income of the assessee and books of accounts have not been rejected u/s 145(3) of the Act, which is sine qua non for invoking provisions of sec.68 of the Act and hence the addition of part of the same amount once again u/s 68 of the Act would tantamount to double taxation of the same income. 3. That, the Ld. C.I.T.(A) further erred in upholding the addition of Rs.94,50,000/- u/s 68 of the Act in spite of the fact that the cash withdrawals from the bank out of the credit balance therein were accepted as genuine and the cash withdrawn was sufficient to cover high denomination notes held by the assessee and hence as per law the assessee was not required to prove source of receipt of such high denomination currency notes which were legal tender at the relevant time. 4. That, the Ld. revenue authorities further erred in assuming the deposit of SBN of Rs. 1000/- each aggregating to Rs.94,50,000/- out of withdrawals of Rs. 1,02,75,000/- in denomination of 1000 and 500 legal currency notes as unexplained cash credit u/s 68 of the Act in spite of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... due to declaration of demonetization scheme on 08.11.2016 the assessee had no option except to deposit the same in the bank. 4. Ld. AO further enquired into the transaction and got the information of the denomination of the currency received by the assessee on withdrawal from Tamilnad Mercantile Bank and matched with the cash currency deposited in the Union Bank of India and came to a conclusion that the assessee had at least 1878 nos. of 500 old currency notes in hand as 01.11.2016 and the same did not match with the currency notes deposited on 16.11.2016 which are of 1000 old currency notes. Though the assessee submitted the cash book and all necessary details but the same could not satisfy the ld. AO and he proceeded to make the addition u/s 68 of the Act for unexplained cash credit at Rs. 94,50,000/- and assessed the income at Rs. 94,50,000/-. 5. Aggrieved, the assessee preferred appeal before the ld. CIT(A) but failed to succeed as ld. CIT(A) confirmed the view taken by the ld. AO observing as follows: 3.1 Ground Nos 1 2:-Through these grounds of appeal, the appellant has challenged the addition made by the AO amounting to Rs: 94,50,000/- on account of unexplained ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... an transaction, the onus shifts upon the Assessing Officer and after verification, he can call for further explanation from the appellant and in the process, the onus may again shift from the Assessing Officer Therefore, the appellant failed to discharge the burden of proof by not establishing the generation of cash. Therefore, the addition made by the AO on this ground amounting to Rs.94,50,000/-Confirmed. The appeal on this ground is Dismissed. 6. Aggrieved the assessee is now in appeal before this Tribunal. Ld. Counsel for the assessee referring to the written submissions running into 12 pages, stated that the assessee has successfully shown the proof of the source of cash deposits in bank during demonetization period which is evidently the cash withdrawals made by the assessee from its own bank account during the pre-demonetization. The said fact is not even disputed by ld. AO. All cash withdrawals and cash deposit and duly entered in the audited accounts of the assessee. The additions made by ld. AO are clearly based on surmises and conjectures and there is no reference to any documentary evidences in the assessment order to remotely suggest that cash deposits were unexpl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he source of cash deposit of Rs. 94,50,000/- is the cash withdrawn of Rs. 1,02,75,000/- on various dates during the year itself which were before the announcement of demonetization scheme on 08.11.2016. 8.3. The first observation of the Revenue authorities that why the assessee kept the funds idle with it for few months seems to have no merit in our view as it is the prerogative of the assessee company to utilize its funds in the way it finds prudent to be done so in the interest of running a business. We do not find anything unusual of the assessee keeping the cash in hand idle with it which was withdrawn from the bank and shown in the cash book. 8.4. The second interesting observation by the ld. AO is that the denomination of currency withdrawn from Tamilnad Mercantile Bank do not tally with the denomination of the currency deposited in Union Bank of India. Though this allegation of the ld. AO made on the basis of information received by the ld. AO from bank u/s 133(6) of the Act was not provided to the assessee, thereby, denying the principles of interest of justice in not providing the assessee an opportunity to cross examine the information gathered by the ld. AO in the ..... 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