9911796707
TMI Blog2018 (7) TMI 2326X X X X Extracts X X X X X X X X Extracts X X X X ..... Act,1961 (in short 'the Act') by the Income Tax Officer, Ward-6(2) Surat (in short "the AO"). 2. Ground No.1 states that the ld.CIT(A) has erred in confirming the action of Assessing Officer in treating income of Rs.2,13,700/- shown in the Return of income as income from other source. Ground No.2 is against the confirmation of addition of Rs.15,00,271/- as unexplained cash deposit in the bank account. Ground No.3 relates to not giving set off of Rs.2,13,700/- shown in the Return of income while making the above addition as unexplained cash deposit in the bank account. 3. Since the above three grounds are inter-connected, and hence same are being considered together. 4. Briefly stated facts of the case are that the assessee has filed Retu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t balance of Rs.3,51,042/- appearing on 27.12.2010 in the bank account. However, the CIT(A) observed that the whole transaction was shown as make believe and no genuine business activity was carried out by the assessee, therefore, CIT(A) was of the view that explanation regarding cash deposits in the bank account is not substantiated with the proper evidence. It was further observed that since the source of income of Rs.15,00,271/- is totally different and addition is made unexplained cash deposits, therefore set off of income of Rs.2,13,700/- cannot be allowed. Accordinlgy the appeal of the assessee was came to be dismissed. 6. Being aggrieved, the assessee filed appeal before the Tribunal. The ld.Counsel for the assessee contended that t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ash deposits amounting to Rs.16.06 lakhs made in the bank account are not related with the sales as claimed by the assessee. Therefore, the same cannot be considered as part of turnover as claimed by the ld.Counsel for the assessee. 8. We have considered the facts and perused the material on record. We find that the assessee has shown total turnover of Rs.7,42,213/- for the year under consideration and therefore the claim that cash deposit corresponding to this sale should be set off from total deposits of Rs.16,06,700/- made during the year is not found convincing. Further set off of Rs.1,77,920/- and Rs.45,00/- on account of amount from debtors and unsecured loan from relatives respectively should be given only if the estimation of incom ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to restrict the addition of cash deposit to the extent of peak credit balance of Rs.3,51,042/- as appearing on 23.12.2010 in the bank account. In the light of these facts, the addition made on account of cash deposits at Rs.15,00,271/- is restricted to Rs.3,51,042/-. Accordingly, ground no.2 of the appeal is partly allowed. 9. With regard to set off of Returned income of Rs.2,13,700/- is concerned, we are of the view that this cannot be allowed as the deposits are not found to be linked with the sale proceeds of the assessee. However, it is true that the income of Rs.1,48,843/- has been shown @ 20% of total turnover of Rs.7,42,213/- the same relates to business transaction, therefore, AO is directed to treat the said income as income from ..... X X X X Extracts X X X X X X X X Extracts X X X X
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