TaxTMI 
TaxTMI 
2024 (2) TMI 1224
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....worn statement recorded u/s. 131(1A) of the Act the partner of the assessee firm confirmed that cash in demonetized currency was not accepted after 23/11/2016, hence the cash deposits made afterwards in SBNs cannot be said to have received from sale of milk. 4. The CIT(A) erred in deleting the addition of Rs. 5,54,94,690/- holding that cash deposit of Rs. 5,54,94.690/- made out of cash sales in normal course of business without appreciating the facts that the assessee has not submitted any books of account during the course of assessment proceedings. 5. The appellant craves to amend, modify, alter, add or forego any ground(s) of appeal at any time before or during the hearing of appeal. 3. At the outset, we find that there is a delay of 15 days in filing of the appeal, for which, an affidavit has been filed explaining the reasons for delay in filing of the appeal. The Ld.DR referring to affidavit filed by the AO submitted that due to Covid situation then prevailing at that time the appellate order was received by the AO, because of disturbance in the regular functioning of the Office, appeal could not be filed. Therefore, he submitted that the delay in filing of the appeal sho....
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....lanation furnished by the assessee and according to the AO, the assessee could not explain known source of income in respect of cash deposits into bank account in old demonetized currency notes amounting to Rs. 1,10,30,000/-. The AO further noted that although, the assessee produced cash book in respect of balance cash deposits, but there is a variation in cash balance as per statement of the Cashier, Shri C.Prabhu, and cash book furnished by the assessee. Therefore, rejected cash book filed by the assessee and treated entire cash deposits to the tune of Rs. 6,65,24,690/- deposited during demonetization period as unexplained money and brought to tax u/s. 69A r.w.s. 115BBE of the Act. 6. Being aggrieved by the assessment order, the assessee preferred an appeal before the Ld.CIT(A). Before the Ld.CIT(A), the assessee has filed detailed written submissions on the issue which has been extracted in Para No.6 on Page Nos.5 to 22 of the order of the Ld.CIT(A). The sum and substance of the arguments of the assessee before the Ld.CIT(A) are that when the report of the ADIT (Investigation), Trichy, itself shows cash deposits of Rs. 1,10,30,000/- in demonetized currency from 08.11.2016 to 23....
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....ss of Rs. 83,94,933/- against unexplained cash deposits of Rs. 1,10,30,000/- without appreciating the facts that, cash book submitted during the course of investigation failed to explain the source for cash deposits made by the assessee's firm in Specified Bank Notes (in short "SBNs") after 24.11.2016. The Ld.CIT-DR further submitted that the Ld.CIT(A) failed to note that during the course of sworn statement recorded from the partner of the assessee's firm, he has confirmed cash deposits in demonetized currency, and thus, there is no reasons for the Ld.CIT(A) to allow relief to the assessee towards stock loss. The Ld.DR further submitted that the Ld.CIT(A) erred in deleting the addition of Rs. 5,54,94,960/- by holding that source for said cash deposits is out of cash sales under normal course of business, even though, the assessee has not submitted any books of accounts during the course of assessment proceedings, Therefore, he submitted that the order of the Ld.CIT(A) should be reversed and additions made by the AO towards total cash deposits u/s. 69A r.w.s. 115BBE of the Act, should be sustained. 9. The Ld.Counsel for the assessee, Shri S. Sridhar, Advocate, supporting the order....
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....he ground that the cash book submitted by the assessee during the course of assessment proceedings is not reliable, because, as per cash book submitted by the assessee, the opening cash balance was shown at Rs. 1,69,29,437/-, whereas, cash in hand as per cash book during survey proceedings was shown at Rs. 10,75,464/-. Except this reason, the AO has not given any other valid reason for not rejecting the books of accounts, including cash book submitted by the assessee. Therefore, it is necessary to decide the issue of cash deposits during demonetization period in light of reasons given by the Ld.CIT(A) to partly sustain the additions made u/s. 69A of the Act, and deleting the balance addition towards cash deposits in new currency notes. 11. Admittedly, out of total cash deposits, a sum of Rs. 1,51,35,500/- is in old currency notes. The assessee could not explain source of income for cash deposits of Rs. 1,10,30,000/- between 08.11.2016 and 31.12.2016 in old currency notes. In fact, the AO has allowed credit to the extent of opening cash in hand available with the assessee in old currency notes. Since, the assessee could not establish source for cash deposits in old currency notes t....
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.... The assessee has explained difference in cash balance between two cash books and argued that cash book considered by the Survey Team on 27.11.2016, is a rough cash book maintained by the Cashier at Factory premise, whereas, the cash book submitted by the assessee, is a computer generated cash boo,k which contain total transactions of the assessee. In our considered view, the explanation given by the assessee to explain difference in cash balance as per two cash books is reasonable and acceptable. Therefore, we are of the considered view that there is no error in the reasons given by the Ld.CIT(A) to delete addition made towards balance cash deposits of Rs. 5,54,94,690/- and thus, we are inclined to uphold the findings of the Ld.CIT(A) and reject the ground taken by the Revenue. 13. Having said so, let us come back to estimation of returned income. The assessee has declared income from business and profession at Rs. 1,98,55,779/- which includes profit margin of the assessee in respect of cash deposits into bank account in demonetized currency notes amounting to of Rs. 1,10,30,000/-. The AO has made additions towards total cash deposits including cash deposits in demonetized curren....