TMI Blog1990 (10) TMI 97X X X X Extracts X X X X X X X X Extracts X X X X ..... he assessee who appeared before the ITO had contended that this amount had been withdrawn from some other firm and copy of that account was filed. According to the assessment order the representative was asked to produce the depositors but that was not done. The ACC's order in quantum appeal shows that the addition had been confirmed on the ground that the assessee did not produce any evidence regarding the capacity of the depositors except for the aforesaid confirmatory declaration by the depositors. The AAC has, therefore, confirmed the addition of the main amount of Rs. 5,000 as well as of the interest of Rs. 100 made by the ITO. 2. In the penalty order the ITO has observed that since the difference between the assessed income and the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... could be made for unexplained cash credit but that it did not hold that on that account penalty could be levied. The AAC relied upon the following decisions: CIT vs. Vinaychand Harilal (1979) 8 CTR (Guj) : (1979) 120 ITR 752 (Guj) CIT vs. Ratanlal Mishrilal (1983) 143 ITR 929 (MP) CIT vs. Aesbestos Allied Packing Co. (1983) 35 CTR (Cal) 251 : (1983) 144 ITR 109 (Cal) CIT vs. Bhimji Bhanjee Co. (1983) 32 CTR (Bom) 296 : (1984) 146 ITR 145 (Bom) They according to him held that for additions made under s. 69 penalty under s. 271(1)(c) was not leviable. Relevant declaration in connection with the deposits, a copy of the letter was filed before the Tribunal. A perusal thereof show that it is in the ready type form wherein the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rs out the fact that in spite of several opportunities the assessee failed and neglected to prove the genuineness of the deposits and the capacity of the depositors. 4. The question that remains, therefore, for consideration is whether penalty can be levied because the assessee failed to prove the genuineness of the deposits; addition having already been confirmed by the AAC. As indicated above considerable case law has been relied upon by the AAC. 5. In the case of Vinaychand Harilal admission was made before the AAC that the amounts in question belonged to the assessee and may be assessed in his hands. The High Court held that it was only because of provisions of s. 69A that the amount could be considered as income of the assessee f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... above in such that there is hardly any evidence to support the assessee's case of genuine deposit. 7. In the case of Asbestos Allied Packing Co. the addition was made and penalty imposed because the ITO had held that in absence of satisfactory evidence the assessee had agreed to taking of peak credit as the income from undisclosed sources. The Tribunal held that the question before it was whether it was probable that the entire trading addition for the whole year would have accrued to the assessee on the first few days of the accounting year. It held that on probabilities it appeared that the hundi loan could not represent trading account addition for the whole year and so the argument that it represented business income could not be ..... X X X X Extracts X X X X X X X X Extracts X X X X
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