Assistant Commissioner of Income-tax, V. Late Mrs. shailaja Uttamrao Jadhav, Satara

ITA 2074/PUN/2013

• Counselvise Citation: [2015] 134 COUNSELVISE.COM (IT) 1009 (ITAT-PUNE)
• Duration Of Justice: 1 year(s) 10 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-10-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2003-2004
• Appeal Filed On: 29-11-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: DR PRAYAG JHAPRATEEK JHA
• Keywords: Unexplained cash credit; Unexplained investment
• Section: 40A(3); 143(3); 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, PUN E , , !'#'' $ , % & BEFORE SHRI R.K. PANDA, AM AND SHRI VIKAS AWASTHY, JM / ITA NO. 2074/PN/2013 %' ( ')( / ASSESSMENT YEAR : 2003-04 ASSISTANT COMMISSIONER OF INCOME TAX, SATARA CIRCLE, SATARA ....... / APPELLANT ' / V/S. LATE MRS. SHAILAJA UTTAMRAO JADHAV THROUGH LEGAL HEIR PADMASINH U. JADHAV, AT & POST WARUNJE, S. NO. 249, PLOT NO. 1048, LAXMI COLONY, WARUNJE PHATA, TAL. KARAD, DISTT. SATARA PAN : ABAPJ7008G / RESPONDENT / ITA NO. 2143/PN/2013 %' ( ')( / ASSESSMENT YEAR : 2003-04 LATE SHAILAJA UTTAMRAO JADHAV THROUGH LEGAL HEIR UTTAMRAO JADHAV, SHRISHAILYAM, VILLAGE SULTANGADE, TAL. KHANAPUR, DISTT. SANGLI PAN : ABAPJ7008G ....... / APPELLANT ' / V/S. ASSISTANT COMMISSIONER OF INCOME TAX, SATARA CIRCLE, SATARA / RESPONDENT ASSESSEE BY : DR. PRAYAG JHA/PRATEEK JHA REVENUE BY : SHRI RAJESH DAMOR / DATE OF HEARING : 27-08-2015 / DATE OF PRONOUNCEMENT : 23-10-2015 2 ITA NOS. 2074 & 2143/PN/2013, A.Y. 2003-04 * / ORDER PER VIKAS AWASTHY, JM : THESE CROSS APPEALS HAVE BEEN FILED BY THE REVENUE AND THE ASSESSEE AGAINST THE ORDER OF COMMISSIONER OF INCOME TAX (APPEALS)III, PUNE DATED 02.09.2013 FOR THE ASSESSMENT YEAR 2003-04. ITA NO. 2074/PN/2013 HAS BEEN FILED BY THE DEPARTMENT AND ITA NO. 2143/PN/2013 HAS BEEN FILED BY THE ASSESSEE. SINCE IN BO TH THE APPEALS, THE ISSUES RAISED BY THE RIVAL SIDES ARE ARISING FR OM THE SAME IMPUGNED ORDER, THESE APPEALS ARE TAKEN UP TOGETHER FOR ADJUDICA TION. 2. THE ASSESSEE IS ENGAGED IN THE BUSINESS OF CUTTING AN D POLISHING OF DIAMOND, MAKING OF GOLD JEWELLERY STUDDED WITH DIAMOND AND OTHER PRECIOUS STONES. THE ASSESSEE DIED ON 24.09.2003. THE P RESENT APPEAL HAS BEEN FILED BY SHRI UTTAMRAO JADHAV, LEGAL HEIR OF THE AS SESSEE. THE RETURN OF INCOME WAS FILED ON BEHALF OF THE ASSESSEE BY SHR I PADMSINHA U. JADHAV SON OF ASSESSEE ON 20.11.2003 DECLARING TOTAL IN COME OF RS.9,67,320/- INCLUSIVE OF AGRICULTURAL INCOME OF RS.6,95,630/-. THE CASE OF THE ASSESSEE WAS SELECTED FOR SCRUTINY. ACCORDIN GLY, NOTICE UNDER SECTION 143(2) OF THE INCOME-TAX ACT, 1961 (HEREINAFT ER REFERRED TO AS THE ACT) WAS ISSUED TO THE ASSESSEE ON 12.10.20 04. DURING THE COURSE OF SCRUTINY ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER MADE CERTAIN ADDITIONS / DISALLOWANCES IN THE INCOME RETURNED BY THE ASSESSEE AND ASSESSED THE TOTAL INCOME AT RS.2,23,06,970/-. AGGRIEVED BY THE ASSESSMENT ORDER DATED 13.03.2006, TH E ASSESSEE PREFERRED AN APPEAL BEFORE THE COMMISSIONER OF I NCOME-TAX (APPEALS). THE COMMISSIONER OF INCOME-TAX (APPEALS) VIDE IMP UGNED ORDER GRANTED PART RELIEF TO THE ASSESSEE. AGAINST THE FINDINGS OF 3 ITA NOS. 2074 & 2143/PN/2013, A.Y. 2003-04 COMMISSIONER OF INCOME-TAX (APPEALS), BOTH THE ASSESSEE A ND THE REVENUE ARE IN APPEAL BEFORE THE TRIBUNAL. THE ADDITIONS / DISALLOWANCES MADE BY THE ASSESSING OFFICER AND THE RELIEF GR ANTED / ADDITIONS SUSTAINED BY THE COMMISSIONER OF INCOME-TAX (AP PEALS) ON WHICH RIVAL SIDES ARE IN APPEAL BEFORE THE TRIBUNAL ARE TABU LATED HEREUNDER:- SR. NO. ADDITIONS MADE BY AO UPHELD BY CIT(A) ASSESSEE IN APPEAL DELETED BY CIT(A) DEPT. IN APPEAL 1 UNSECURED LOANS 22,54,486 5,97,000 5,89,111 2 UNACCOUNTED ADVANCES 28,24,278 24,23,278 - 3 DIFFERENCE IN GOLD STOCK 2,62,752 2,62,752 - 4 DIFF ERENCE IN CLOSING STOCK OF SILVER 95,074 95,017 - 5 DONATIONS 4,000 5,000 - 6 CASH PURCHASES 4,84,028 1,11,583 3,70,347 7 CASH PAYMENTS 3,92,393 21,546 8 CASH DEPOSITS 16,21,900 30,630 15,91,270 9 UNEXPLAINED INVESTMENT IN FLAT AT DADAR, MUMBAI 52 , 27 ,0 96 - 13,00,000 10 COMMISSION PAID TO SELLING AGENT 85,812 - 85,812 11 INVESTMENT IN NSC 2,50,000 - 2,50,000 1 2 UNEXPLAINED CASH DEPOSIT IN BANK ACCOUNTS OF THE ASSESSEE 15,95,630 35,12,762 2,68,900 3,22,000 - 15,95,630 35,12,762 2,68,900 3,22,000 3. FOR THE PURPOSE OF ADJUDICATING THE ISSUES RAISED IN T HE APPEALS, WE WILL TAKE UP THE APPEAL OF ASSESSEE ALONG WITH THE CORR ESPONDING ISSUES RAISED BY THE DEPARTMENT IN ITS APPEAL. THEREAFTER , THE REMAINING ISSUES RAISED BY THE DEPARTMENT IN APPEAL WILL BE TAKEN U P. UNSECURED LOANS: 4. THE ASSESSING OFFICER HAD MADE ADDITION OF RS.22,54,486/- TOWARDS UNSECURED LOANS, AS THEY WERE NOT PROVED BY T HE ASSESSEE. DURING THE COURSE OF PROCEEDINGS BEFORE THE FIRST APPELLATE AUTHORITY, THE ASSESSEE FURNISHED AFFIDAVITS, BANK DETAILS, PAN DETAILS, ET C. OF THE 4 ITA NOS. 2074 & 2143/PN/2013, A.Y. 2003-04 PERSONS FROM WHOM THE ASSESSEE HAD TAKEN LOANS. FROM THE TOTAL LOAN OF RS.22,54,486/-, THE COMMISSIONER OF INCOME-TAX (APPEALS) GRANTED RELIEF TO THE EXTENT OF RS.10,68,375/- ON THE GROUND THAT FROM THE EVIDENCE FILED BY THE ASSESSEE AS WELL AS THE REMAND REPO RT OF THE ASSESSING OFFICER, IT WAS ESTABLISHED THAT THE SAID AMOUNT O F UNSECURED LOANS REPRESENT BROUGHT FORWARD LOANS PERTAINING TO EARLIE R ASSESSMENT YEARS AND WERE NOT ASSESSABLE DURING THE CURRENT ASSE SSMENT YEAR. FURTHER, THE COMMISSIONER OF INCOME-TAX (APPEALS) HELD THAT UNSECU RED LOANS OF RS.1,11,111/- TAKEN FROM SMT. BHARTI B PAWAR WAS PROVED. THE ASSESSEE COULD SHOW THE SOURCE AS WELL AS CREDITWOR THINESS OF THE CREDITOR ADVANCING THE LOAN. THE COMMISSIONER OF INCOME-T AX (APPEALS) ALSO GRANTED RELIEF TO THE EXTENT OF RS.4,78,000/- IN RES PECT OF UNSECURED LOANS ADVANCED BY SHRI UTTAMRAO H. JADHAV, HU F ON THE GROUND THAT HUF HAD INCOME FROM POULTRY FARM AND CATTLE FARM. THE ASSESSEE COULD ESTABLISH NET PROFIT FROM AGRICULTURE AND P OULTRY BUSINESS OF HUF TO THE EXTENT OF RS.4,78,000/- IN THE PE RIOD RELEVANT TO THE ASSESSMENT YEAR 2003-04. HENCE, THE SAME WAS ACC EPTED BY THE COMMISSIONER OF INCOME-TAX (APPEALS). THE ASSESSEE IN APP EAL HAS ASSAILED THE FINDINGS OF COMMISSIONER OF INCOME-TAX (APPEALS) IN UPHOLDING THE DISALLOWANCE OF UNSECURED LOANS TO THE EXTEN T OF RS.5,97,000/-. 4.1 THE LD. AR SUBMITTED THAT APART FROM OTHER PERSONS, T HE ASSESSEE HAD TAKEN LOAN FROM SMT. NEENA S. KAMAT RS.1,50,000/- AND SMT. SHOBHA B. MOHITE RS.1,00,000/-. SMT. NEENA S. KAMAT HAD FILE D AN AFFIDAVIT ALONG WITH EXTRACT OF BANK ACCOUNT BEFORE THE COM MISSIONER OF INCOME-TAX (APPEALS). THE ASSESSEE HAD ALSO FILED A COPY OF BANK PASS BOOK OF SMT. SHOBHA B. MOHITE ALONG WITH PHOTOCOPY OF LETTE R STATING 5 ITA NOS. 2074 & 2143/PN/2013, A.Y. 2003-04 THAT SHE HAD ADVANCED RS.1,00,000/- BY CHEQUE TO THE A SSESSEE AS A HELP FOR PURCHASE OF HOUSE. THE COMMISSIONER OF INCOME-T AX (APPEALS) REJECTED THE EVIDENCES FILED ON BEHALF OF ABOVE SAID TWO P ERSONS ON THE GROUND THAT AFFIDAVIT SUBMITTED BY SMT. NEENA S. KAMAT IS CONTRARY TO THE BANK STATEMENT FILED BY HER. IN THE AFFIDAVIT, SHE HAD MENTIONED THE AMOUNT AS RS.1,50,000/-, WHEREAS AS PER THE BANK S TATEMENT, THE AMOUNT ADVANCED IS RS.90,000/- ONLY. FOR SIMILAR REASONS, THE COMMISSIONER OF INCOME-TAX (APPEALS) REJECTED THE EVIDENC E FILED ON BEHALF OF SMT. SHOBHA B. MOHITE. THE LD. AR CONTENTED THAT THE COMMISSIONER OF INCOME-TAX (APPEALS) HAS NOT CONTRADICTED THE FACT THAT THE AMOUNTS HAVE BEEN RECEIVED BY THE ASSESSEE THROUGH BANK TRANSACTIONS. THE LD. AR HAS DRAWN OUR ATTENTION TO PAGES 84 AND 85 OF PAPER BOOK, WHEREIN STATE BANK OF INDIA SAVINGS ACCOUNT BANK P ASS BOOK IN RESPECT OF SMT. NEENA S. KAMAT IS PLACED ON RECORD. A PE RUSAL OF BANK PASS BOOK SHOWS THAT AN AMOUNT OF RS.90,000/- HAS BEE N DEBITED VIDE CHEQUE NO.601294 ISSUED IN FAVOUR OF SHAILAJA U J. TH E LD. AR FURTHER DRAWS OUR ATTENTION TO PAGES 89 AND 90 OF THE PAPER B OOK, WHEREIN STATE BANK OF INDIA SAVING ACCOUNT BANK PASS BOOK OF S MT. SHOBA B. MOHITE IS PLACED ON RECORD. A PERUSAL OF THE SAME SHOWS THAT ON 08.08.2002, TWO CHEQUES BEARING NO.364642 FOR RS.60,000/- A ND 364643 FOR RS.40,000/- HAVE BEEN DEBITED. THE LD. AR HAS ALSO PLACED ON RECORD A COPY OF BANK STATEMENT OF ASSESSEES ACCO UNT WITH KARAD URBAN CO-OPERATIVE BANK LTD., FORT, MUMBAI, WHEREIN ON 09 .08.2002, AN AMOUNT OF RS.1,00,000/- HAS BEEN CREDITED BY TRANSFER FROM STATE BANK OF INDIA. THUS, THE LD. AR HAS BEEN ABLE TO SHOW TH E SOURCE OF UNSECURED LOAN TO THE EXTENT OF RS.1,90,000/- FROM THE AFO RESAID TWO PERSONS. SINCE, THE AMOUNTS HAVE BEEN TRANSFERRED THR OUGH BANKING 6 ITA NOS. 2074 & 2143/PN/2013, A.Y. 2003-04 CHANNELS AND BOTH THE PERSONS HAVE ADMITTED THE TRANS ACTION, WE DO NOT FIND ANY REASON TO DISBELIEVE THE SAME. WE FURTHER DE LETE ADDITION TO THE EXTENT OF RS.1,90,000/- FROM THE AMOUNT OF UNSECU RED LOANS. ACCORDINGLY, THIS GROUND OF APPEAL RAISED BY THE ASSESSEE IS PARTLY ACCEPTED. 5. THE DEPARTMENT IN ITS APPEAL HAS ASSAILED THE FINDINGS OF COMMISSIONER OF INCOME-TAX (APPEALS) IN DELETING RS.5,89,111/ - ON ACCOUNT OF UNSECURED LOANS. THE REVENUE HAS ASSAILED TH E AMOUNT OF RS.1,11,111/- RECEIVED BY THE ASSESSEE FROM SMT. BHARTI B . PAWAR AND RS.4,78,000/- RECEIVED FROM SHRI UTTAMRAO JADHAV, HUF. WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF COMMISSIONER OF INCOME-TAX (APPEALS) IN DELETING THESE AMOUNTS AS THE ASSESSEE HAS BEEN ABLE TO PROVE THE SOURCE AS WELL AS CREDITWORTHINESS OF THE PERSONS FOR ADV ANCING THE SAID LOAN AMOUNTS. THE LD. DR HAS NOT BEEN ABLE TO CONTROVE RT THE FINDINGS OF COMMISSIONER OF INCOME TAX (APPEALS) IN DELETING THE AFORES AID AMOUNTS. ACCORDINGLY, THIS GROUND OF APPEAL RAISED BY THE DEPARTMENT IS REJECTED. UNACCOUNTED ADVANCES : 6. THE SECOND GROUND RAISED BY THE ASSESSEE IN APPEAL IS AGAINST UNACCOUNTED ADVANCES OF RS.24,23,278/- CONFIRMED BY THE COMMISSIONER OF INCOME TAX (APPEALS). THE ASSESSING OFFICER HAD MADE ADDITION OF RS.28,24,278/-. THE ASSESSEE HAD ALLEGEDL Y RECEIVED ADVANCES FROM VARIOUS PERSONS VIZ. SHRI ANANDRAO SHAMRA O GAIKWAD, SHRI KIRAN K. JADHAV, SHRI NIWAS M. JADHAV, SHRI SAMBHAJI A . JADHAV, ETC. NEITHER THE ASSESSEE COULD PRODUCE ANY EVIDENCE IN SUPPORT OF HIS SUBMISSIONS NOR THE AFORESAID PERSONS APPEARED BEFORE TH E ASSESSING OFFICER IN RESPONSE TO THE SUMMONS ISSUED. DURING THE COU RSE OF FIRST 7 ITA NOS. 2074 & 2143/PN/2013, A.Y. 2003-04 APPELLATE PROCEEDINGS, THE ASSESSEE FILED AFFIDAVITS FROM THE IN DIVIDUALS FROM WHOM THE ASSESSEE HAD ALLEGEDLY RECEIVED ADVANCES. HOWEVER, THE COMMISSIONER OF INCOME TAX (APPEALS) REJECTED THE SAME, EXCEPT AN ADVANCE OF RS.1,90,000/- FROM SHRI NIWAS MADHUKAR JADHAV, WHICH PERTAINS TO BALANCE BROUGHT FORWARD FROM THE EARLIER ASSE SSMENT YEAR. THE COMMISSIONER OF INCOME TAX (APPEALS) HELD THAT THE AS SESSEE HAS NOT BEEN ABLE TO SUBSTANTIATE THE IDENTITY, CREDITWORTHIN ESS AND GENUINENESS OF THE TRANSACTIONS EITHER BEFORE THE ASSESS ING OFFICER OR IN THE REMAND PROCEEDINGS. THE LD. AR SUBMITTED THAT THE AFFIDAVITS FILED BY THE ASSESSEE WERE NOT CONSIDERED BY THE COMMISSIONE R OF INCOME TAX (APPEALS). IN THE REMAND REPORT, THE ASSESSING OFFIC ER HAS NOT PROVED THAT THE CONTENTS OF THE AFFIDAVIT ARE INCORRECT. 6.1 WE FIND THAT THE AFFIDAVITS FILED BY THE ASSESSEE WERE W ITHOUT CORROBORATIVE EVIDENCE AND THE ASSESSEE HAS NOT BEEN ABLE TO PROVE THE IDENTITY, CREDITWORTHINESS AND GENUINENESS OF THE TRANSACT IONS. THE ASSESSEE HAS NOT BEEN ABLE TO SHOW FROM RECORDS THE GENUINENE SS OF THE TRANSACTIONS EVEN BEFORE US. IN THE ABSENCE OF CORROBO RATIVE EVIDENCE, WE DO NOT FIND ANY INFIRMITY IN THE FINDINGS OF COMMISSIONER OF INCOME TAX (APPEALS) IN CONFIRMING THE ADDITION. ACCORDINGLY, THIS GR OUND OF APPEAL RAISED BY THE ASSESSEE IS DISMISSED. DIFFERENCE IN GOLD STOCK: 7. THE THIRD GROUND OF APPEAL RAISED BY THE ASSESSEE IS WITH REGARD TO ADDITION ON ACCOUNT OF DIFFERENCE IN GOLD STOCK. THE ASSESSING OFFICER MADE ADDITION OF RS.2,62,752/-. THE COMMISSIONER OF INCOME TAX (APPEALS) UPHELD THE ENTIRE ADDITION. THE LD. AR SUBMITTED T HAT SOME PART OF GOLD IS USED FOR MAKING DIAMOND STUDDED JEWELLERY. THE AUTHORITIES BELOW HAVE FAILED TO CONSIDER THE FACT THAT T HE MINOR 8 ITA NOS. 2074 & 2143/PN/2013, A.Y. 2003-04 VARIATION IN THE STOCK OF GOLD HAS BEEN CAUSED ON ACCOUN T OF USE OF GOLD IN MANUFACTURING OF DIAMOND STUDDED JEWELLERY. WE HAVE CONSIDERED THE SUBMISSIONS MADE BY THE RIVAL SID ES AND HAVE PERUSED THE ORDERS OF AUTHORITIES BELOW. WE ARE OF THE CONSIDERED VIEW THAT SOME ALLOWANCE HAS TO BE GIVEN FOR VARIATION IN S TOCK OF GOLD ON ACCOUNT OF USE OF GOLD IN MANUFACTURING OF DIAMOND STUD DED JEWELLERY. ACCORDINGLY, WE DELETE 40% OF THE ADDITION ON AC COUNT OF VARIATION CAUSED BY USE OF GOLD IN MANUFACTURING OF DIAMOND STUDDED JEWELLERY. ACCORDINGLY, WE CONFIRM THE ADDITION TO THE EXTE NT OF 60% MADE BY THE COMMISSIONER OF INCOME TAX (APPEALS). THIS GR OUND OF APPEAL IS PARTLY ACCEPTED IN THE AFORESAID TERMS. DIFFERENCE IN STOCK OF SILVER: 8. THE FOURTH GROUND OF APPEAL RAISED BY THE ASSESSEE IS IN RESPECT OF DIFFERENCE IN CLOSING STOCK OF SILVER. THE LD. AR HAS RAISE D SIMILAR PLEA AS WAS RAISED IN CASE OF DIFFERENCE IN STOCK OF GOLD. FOR THE SIMILAR REASONS, WE RESTRICT THE ADDITION TO THE EXTENT OF 60% M ADE BY THE AUTHORITIES BELOW. ACCORDINGLY, THIS GROUND OF APPEAL IS ALSO PARTLY ACCEPTED. DONATIONS: 9. DURING THE PERIOD RELEVANT TO THE ASSESSMENT YEAR 2 003-04, THE ASSESSEE HAS MADE DONATION OF RS.5,000/- TO SARMIK SAH YOG RESIDENTIAL SCHOOL. BEFORE ASSESSING OFFICER THE ASSESSEE C LAIMED DONATIONS OF RS.8,000/-. THE ASSESSING OFFICER MADE ADDITION OF 50% OF DONATIONS MADE. BEFORE THE COMMISSIONER OF INCOME TAX (APPEALS) IT WAS SUBMITTED THAT DURING THE YEAR, THE ASSESSEE HAS G IVEN DONATION OF RS.5,000/- TO THE SCHOOL. INADVERTENTLY ADVERTISING EXP ENSES OF RS.3,000/- PAID TO MANTHAN PUBLICATIONS WAS INCLUDED UNDER THE HEAD 9 ITA NOS. 2074 & 2143/PN/2013, A.Y. 2003-04 DONATIONS. THUS, THE ACTUAL DONATION IS ONLY RS.5,000/- . THE COMMISSIONER OF INCOME TAX (APPEALS) MADE ADDITION OF THE E NTIRE DONATION AMOUNT. WE ARE OF THE CONSIDERED VIEW THAT THE DONATION HAS BEEN MADE BY THE ASSESSEE TO A SCHOOL FOR EDUCATION, WH ICH IS A CHARITABLE ACTIVITY. ACCORDINGLY, WE DELETE THE ADDITION OF R S.5,000/- AND ALLOW THIS GROUND OF APPEAL. CASH PURCHASES: 10. THE ASSESSEE AS WELL AS REVENUE HAS ASSAILED THE FINDIN GS OF COMMISSIONER OF INCOME TAX (APPEALS) IN RESPECT OF ADDITION ON ACCOUNT OF CASH PURCHASES. THE ASSESSING OFFICER DURING THE SCRUTINY ASSESSMENT PROCEEDINGS HAS MADE ADDITION OF RS.4,84,028/-. IN FIRST APPEAL, THE COMMISSIONER OF INCOME TAX (APPEALS) RESTRICTED THE ADDITION TO RS.1,11,583/-. THE ASSESSEE HAD MADE CASH PU RCHASES OF GOLD AND SILVER FROM UN-REGISTERED DEALERS. THE ASSESSEE HAS NOT BEEN ABLE TO SUBSTANTIATE SUCH PURCHASES BY PLACING ON RECOR D ANY COGENT EVIDENCE. THE COMMISSIONER OF INCOME TAX (APPEALS) RESTRICT ED THE ADDITION TO 80%. THE LD. AR HAS NOT BROUGHT ANY COGENT EVIDENCE BEFORE US TO CONTROVERT THE FINDINGS OF COMMISSIONER OF INC OME TAX (APPEALS) IN CONFIRMING THE ADDITION TO THE EXTENT OF 20% OF T HE DISALLOWANCE MADE BY THE ASSESSING OFFICER. SIMILARLY, THE LD . DR HAS NOT BEEN ABLE TO HIGHLIGHT ANY ERROR IN THE FINDINGS OF THE COMMISSIONER OF INCOME TAX (APPEALS) IN DELETING THE ADDITION TO THE EXTE NT OF RS.3,70,347/-. THE COMMISSIONER OF INCOME TAX (APPEALS) REST RICTED THE ADDITION TO RS.1,11,583/- WITH THE FOLLOWING OBSERVATIONS:- 17. VIDE GROUND NO. 14, THE APPELLANT CONTESTS THE ADDITION OF RS.4,84,028/-REPRESENTING @ 20% OF CASH PURCHASES A MOUNTING TO RS.24,20,139/-. THE DETAILS REGARDING CASH PURCHASE S OF RS.24,20,139/- ARE AS PER ANNEXURE 16 OF THE ASSESSMENT ORDER R/W ANNEXURES 3 & 6 THEREIN. DURING REMAND PROCEEDINGS THE APPELLANT CO NTENDED BEFORE THE ASSESSING OFFICER THAT THE ACTUAL CASH PURCHASES AR E TO THE EXTENT OF RS.9,57,913/- (COMPRISING RS.7,06,070 + RS.1,89,343 + RS.62,500) MADE FROM UNREGISTERED DEALERS WHO REFINE AND SELL GOLD AND SILVER. IT WAS 10 ITA NOS. 2074 & 2143/PN/2013, A.Y. 2003-04 CONTENDED BEFORE THE ASSESSING OFFICER ALSO THAT TH E CASH PURCHASES AND INVESTMENT SHOULD AT BEST BE TAKEN AT RS.9,57,913/- AND THE ASSESSING OFFICER HAS REPEATEDLY TAKEN THE VERY SAME PAYMENT MADE MORE THAN ONCE FOR MAKING MULTIPLE ADDITION. IT IS ASSESSING OFFICER'S VIEW THAT THE AMOUNT OF RS.9,57,913/- REQUIRES INVOCATION OF SEC 40A(3) SINCE THE COMPELLING CIRCUMSTANCES PROVIDED UNDER RULE 6DD UN DER IT RULES 1962 HAVE NOT BEEN BROUGHT OUT. I HAVE VERIFIED THE RELE VANT ANNEXURE 3 & 6 AND IT IS FOUND THAT THE FIRST 4 AMOUNTS AS PER ANN EXURE 3 (RS.2,50,200/- , RS.1,90,300/-, RS.1,50,300/- & RS. 1,95,270/-) TO TALLING RS.7,06,070/- ARE CASH PURCHASES WHICH STAND REPEATED AS PER FIFT H AMOUNT IN THE SAME ANNEXURE AND ARE CLEARLY SEEN TO BE DUPLICATE ENTRIES. THE ASSESSING OFFICER HAS TAKEN THE YEAREND TOTAL OF CA SH PURCHASES AS RS.7,06,070/- ONCE AGAIN AS A SEPARATE ITEM OF CASH PURCHASE. THE SILVER INGOTS PURCHASED AT KALBADEVI BY CASH AMOUNTING TO RS.1,89,343/- ON 14.08.2002 STANDS REPEATED AT LEAST THRICE INSTEAD OF AS A SINGLE TRANSACTION. SIMILARLY, SILVER TUKDA PAYMENTS MADE I N CASH AMOUNTING TO RS.1,95,270/- PAID ON 17.08.2002 HAVE BEEN DUPLICAT ED IN ANNEXURE 3 AS WELL AS 6. THE LAST 4 ITEMS IN ANNEXURE 3 (R. N OS. 250, 321, 335 & 441) HAVE BEEN SUPPOSEDLY TAKEN AS CASH PURCHASES, BUT THE APPELLANT HAS CLARIFIED THAT THE AMOUNTS REPRESENT CASH DEPOS ITED INTO THE KARAD URBAN CO-OPERATIVE BANK ACCOUNT AND ARE NOT CASH PU RCHASES. THIS HAS BEEN VERIFIED TO BE CORRECT FROM THE COPY OF THE KA RAD URBAN CO-OPERATIVE BANK ACCOUNT FILED BEFORE ME. CONSEQUENTLY, TAKING INTO MY FACTUAL FINDINGS AND THE REMAND REPORT OF THE ASSESSING OFF ICER, THE ADDITION THAT STANDS CONFIRMED IS RS.1,11,583/- (20% OF 9,57,913) . GROUND NO.14 STANDS PARTLY ALLOWED. WE DO NOT FIND ANY ERROR IN THE WELL REASONED FINDINGS OF COMMISSIONER OF INCOME TAX (APPEALS) IN RESTRICTING DISALLOWAN CE TO RS.1,11,583/-. ACCORDINGLY, THIS GROUND OF APPEAL OF THE ASS ESSEE AS WELL AS REVENUE IS DISMISSED. CASH PAYMENTS: 11. THE NEXT GROUND OF APPEAL RAISED BY THE ASSESSEE IN APPEAL IS WITH REGARD TO CASH PAYMENTS. THE ASSESSING OFFICER HAS MADE AN ADDITION OF RS.3,92,393/- U/S. 40A(3) OF THE INCOME-TAX ACT IN RESPECT OF CASH PAYMENTS MADE BY THE ASSESSEE. IN APPEAL, THE COMMISSIONER OF INCOME TAX (APPEALS) HAS GRANTED PART RELIEF TO THE AS SESSEE AND HAS CONFIRMED THE ADDITION ONLY TO THE EXTENT OF RS.21,546/- . THE COMMISSIONER OF INCOME TAX (APPEALS) HAS OBSERVED IN HIS OR DER THAT THE ASSESSEE HAS NOT BEEN ABLE TO SHOW COMPELLING REASO NS FOR MAKING CASH PAYMENTS VIDE RECEIPT NO. 247 DATED 21.10.2002 FOR R S.23,855/-, RECEIPT NO. 232 DATED 20.11.2002 FOR RS.21,375/- AND RECEI PT NO. 452 11 ITA NOS. 2074 & 2143/PN/2013, A.Y. 2003-04 DATED 31.03.2002 FOR RS.62,500/- AGGREGATING TO RS.1,07,730/ -. THE COMMISSIONER OF INCOME TAX (APPEALS) DISALLOWED 20% OF THE S AID AMOUNT UNDER THE PROVISIONS OF SECTION 40A(3) OF THE ACT. THE LD. AR HAS NOT BEEN ABLE TO JUSTIFY CASH PAYMENTS OF RS.1,07,7 30/-. ACCORDINGLY, WE UPHOLD THE FINDINGS OF COMMISSIONER OF INCOM E TAX (APPEALS) ON THIS GROUND AND DISMISS THIS GROUND OF APPEA L OF THE ASSESSEE. CASH DEPOSITS: 12. THE LAST GROUND IN APPEAL BY THE ASSESSEE IS WITH RE GARD TO ADDITION OF CASH DEPOSIT RS.30,630/-. THE ASSESSING OFFICER HAS MADE ADDITION OF RS.16,21,900/- ON ACCOUNT OF CASH DEPOSITS FROM DEBTORS AND CASH CREDITS FROM DEBTORS. IN FIRST APPELLATE PROCEED INGS, THE COMMISSIONER OF INCOME TAX (APPEALS) HAS DELETED THE ADDIT ION TO THE EXTENT OF RS.15,91,270/- AND CONFIRMED THE ADDITION OF RS.30 ,630/- ONLY. AGAINST THE FINDINGS OF COMMISSIONER OF INCOME TAX (AP PEALS), BOTH THE ASSESSEE AND REVENUE ARE IN APPEAL BEFORE US. THE COMMISSIONER OF INCOME TAX (APPEALS) AFTER ANALYZING THE B REAK-UP OF CASH DEPOSIT BY DEBTORS HAS CONCLUDED AS UNDER:- 21.1. THE APPELLANT CONTENDS THAT THE TOTAL AMOUNT OF CASH DEPOSITED IN BANK ACCOUNTS, AS BROUGHT OUT IN THE ABOVE ANNEXURE S TO THE ACIT'S IMPUGNED ORDER, CALCULATES TO RS.7,02,100/- (SOME A MOUNTS ARE FACTUALLY RECEIVED BY CHEQUES WHILE OTHERS ARE NON-EXISTANT A MOUNTS). PERUSAL OF THE TABLE ABOVE SHOWS THAT THE TABLE CASH DEPOSITS ARE ACTUALLY RS.7,62,100/- (BREAK UP BEING RS.3,77,100/- RECEIVE D ON ACCOUNT OF SALE PROCEEDS OF JEWELLERY AND RS.3,65,000/- ON ACCOUNT OF SALE PROCEEDS OF AGRICULTURAL PRODUCE). AT PARA 19.2, MENTION HAS BE EN MADE OF ANOTHER CASH DEPOSIT OF RS.50,000/- INTO BOI C.A. OF APPELL ANT DATED 09.07.2002. THEREFORE, THE TOTAL CASH DEPOSITS FOUND REPRESENTI NG SALE PROCEEDS OF JEWELLERY INCLUSIVE OF THIS AMOUNT IN RS.4,27,100/- , WHICH IS FOUND TO BE ACCOUNTED FOR IN THE BIFURCATION SUBMITTED TO THE A SSESSING OFFICER REGARDING CASH SALES OF JEWELLERY, AMOUNTING TO RS. 11,24,308/-. SO FAR AS CASH DEPOSITS RELATING TO SALE OF AGRICULTURAL P RODUCE IS CONCERNED, EVER IF WE CONSIDER THE AMOUNT OF RS.7,45,630/- AS CASH RECEIVED ON THIS ACCOUNT AS PER PARA 19.2 SUPRA, THE TOTAL CASH DEPO SITS FROM SALE OF AGRICULTURE PRODUCE (INCLUSIVE OF RS. 3,85,000/- AB OVE) COMES TO RS.11,30,630/- SINCE THE GROSS AGRICULTURAL INCOME, AS PER THE APPELLANT'S BOOKS, AND AS ACCEPTED BY THE ASSESSING OFFICER IS RS.11,00,000/-, WHAT SURVIVES FOR ADDITION IS A SUM OF RS.30,630/-. 12 ITA NOS. 2074 & 2143/PN/2013, A.Y. 2003-04 GROUND NO. 18 IS PARTLY ALLOWED. THE APPELLANT SETS RELIEF OF RS.15,91,270. 13. THE REPRESENTATIVES OF THE RIVAL SIDES HAVE NOT BEEN ABLE TO POINT OUT ANY ERROR IN THE FINDINGS OF COMMISSIONER OF INCOME TAX (APPEALS). WE DO NOT FIND ANY INFIRMITY IN THE FACTUAL FINDINGS OF COMMISSIO NER OF INCOME TAX (APPEALS) ON THIS COUNT. ACCORDINGLY, THIS GRO UND OF APPEAL OF ASSESSEE, AS WELL AS OF THE REVENUE IS DISMISSED. 14. IN VIEW OF OUR ABOVE FINDING, THE APPEAL OF THE ASSESSEE IS PARTLY ACCEPTED IN THE AFORESAID TERMS. 15. NOW, WE PROCEED TO DECIDE THE REMAINING GROUNDS IN THE APPEA L OF THE DEPARTMENT. 16. THE FIRST GROUND OF APPEAL RAISED BY THE DEPARTMENT IS GENERAL IN NATURE AND HENCE REQUIRE NO ADJUDICATION. 17. THE GROUND NO. 2 IN APPEAL RAISED BY THE DEPARTMENT HAS BEEN DECIDED ALONG WITH GROUND OF APPEAL NO.1 OF THE APPEAL OF T HE ASSESSEE. THE SAME HAS BEEN DISMISSED. UNEXPLAINED INVESTMENT IN FLAT AT DADAR, MUMBAI: 18. THE GROUND NO. 3 OF APPEAL RAISED BY THE REVENUE IN APPEAL IS WITH RESPECT TO DELETING OF ADDITION MADE ON ACCOUNT OF UNEXPLAINED INVESTMENT IN FLAT AT MUMBAI TO THE EXTENT OF RS.13,00,000/- . THE ASSESSING OFFICER HAD MADE ADDITION OF RS.52,27,096/- IN RESPE CT OF INVESTMENT MADE IN FLAT AT DADAR, MUMBAI BY THE ASSESSEE. BEFORE THE FIRST APPELLATE AUTHORITY, THE ASSESSEE HAS BEEN ABLE TO S HOW THAT THE 13 ITA NOS. 2074 & 2143/PN/2013, A.Y. 2003-04 FLAT COSTING RS.68,13,538/- INCLUSIVE OF STAMP DUTY, WAS PURC HASED BY TAKING LOAN OF RS.45,00,000/- FROM THE BANK AND RS.9,25,000/- AS ADVANCE FROM THE RELATIVES. THE COMMISSIONER OF INCOME TA X (APPEALS) DELETED THE REMAINING AMOUNT OF RS.13,00,000/- ON THE PRE SUMPTION THAT THE ASSESSING OFFICER HAS NOT BROUGHT ANYTHING ON R ECORD TO SHOW THAT THE ASSESSEE WAS NOT HAVING SUFFICIENT OWN FUNDS TO PAY THE BALANCE PURCHASE CONSIDERATION. WE DO NOT FIND ANY ERROR IN THE FINDINGS OF COMMISSIONER OF INCOME TAX (APPEALS) IN DELETING THE REMAINING AMOUNT OF RS.13,00,000/-. THE ASSESSEE IS ENGAGE D IN THE BUSINESS OF MANUFACTURING DIAMOND STUDDED JEWELLERY SINCE 1 993. THE ASSESSEE MUST BE HAVING SOME SAVINGS AND OWN FUNDS FOR INVESTMENT IN FLAT. ACCORDINGLY, THIS GROUND OF APPEAL RAISED BY THE DEPA RTMENT IS DISMISSED. PAYMENT OF COMMISSION: 19. THE GROUND NO. 4 IN APPEAL BY THE REVENUE IS WITH R ESPECT TO DELETING OF ADDITION MADE ON ACCOUNT OF COMMISSION PAID TO S ELLING AGENTS RS.85,812/-. THE COMMISSION HAS BEEN PAID BY THE ASSESSEE AS AN INCENTIVE TO THE SELLING AGENTS. THE ASSESSEE IS NOT M AINTAINING ANY JEWELLERY SHOW ROOM AND IS CARRYING ON THE BUSINESS THRO UGH DIRECT SALES. THE ASSESSEE IS PAYING COMMISSION @ 4% ON SALE OF D IAMOND STUDDED JEWELLERY, 2% ON SALE OF GOLD JEWELLERY AND 5% ON O THER ITEMS. THE COMMISSION WAS PAID TO SHRI NIWAS M JADHAV AND MRS. MADHURI N JADHAV. THE ASSESSING OFFICER DISALLOWED THE CLAIM OF ASSESSE E ON THE GROUND THAT IT IS SUPPORTED BY SELF MADE VOUCHERS. THE COMMISSIONER OF INCOME TAX (APPEALS) IN HIS ORDER HAS GIVEN A CATEGORIC FINDING THAT ON 03.01.2006 THE ASSESSEE HAD FURNISHED COMMISSION CREDI T MEMOS IN THE FORM OF PAPER BOOK BEFORE THE ASSESSING OFFICER. SINCE THE ASSESSEE IS NOT MAINTAINING ANY SHOW ROOM, PAYMENT OF COMMISSION ON SALES 14 ITA NOS. 2074 & 2143/PN/2013, A.Y. 2003-04 MADE THROUGH AGENT IS JUSTIFIED. THE LD. DR HAS NOT BEEN ABLE TO CONTROVERT THE FINDINGS OF COMMISSIONER OF INCOME TAX (APPE ALS). WE DO NOT FIND ANY ERROR IN THE FINDINGS OF COMMISSIONER OF INCO ME TAX (APPEALS) IN DELETING THE ADDITION ON ACCOUNT OF PAYMENT OF COMMISSION TO SELLING AGENT. ACCORDINGLY, THIS GROUND OF APPEAL RAISED BY THE REVENUE IS DISMISSED. INVESTMENT IN NSC: 20. THE GROUND NO. 5 IN APPEAL BY THE REVENUE IS WITH R ESPECT TO DELETING OF ADDITION MADE ON ACCOUNT OF UNEXPLAINED INVESTME NT IN PURCHASE OF NSC TO THE TUNE OF RS.2,50,000/-. THE ASSESS ING OFFICER NOTED THAT THE ASSESSEE HAS SHOWN INTEREST INCOME OF R S.25,375/- AS INTEREST ON NSC IN THE PROFIT & LOSS ACCOUNT, WHEREAS IN THE BALANCE SHEET, THE ASSESSEE HAS SHOWN INVESTMENT IN NSC ONLY T O THE TUNE OF RS.10,000/-. FROM THE INTEREST INCOME, THE ASSESSING OFFIC ER CALCULATED THE INVESTMENT IN NSCS TO ARRIVE AT FIGURE OF R S.2,50,000/-. DURING THE PROCEEDINGS BEFORE THE COMMISSIONER OF INCOME TAX (APPEALS), THE ASSESSEE EXPLAINED THAT THE INTEREST INCOME OF RS.25,375/- INCLUDES INTEREST ON INVESTMENT IN ICICI DEPOS ITS OF RS.10,000/-, ICICI SAFETY BONDS OF RS.20,000/-, NSC OF RS.10,0 00/- AND PPF ACCOUNT RS.1,51,835/-. IN THE PROFIT & LOSS ACC OUNT, IT WAS INADVERTENTLY MENTIONED AS INTEREST ON NSCS, WHEREAS TH E INTEREST WAS FROM AFORESAID VARIOUS DEPOSITS. THE EXPLANATION FURNISHED BY THE ASSESSEE WAS FOUND GENUINE BY THE COMMISSIONER OF INCOME TAX (APPEALS) AND ACCORDINGLY, THE ADDITION OF RS.2,50,000/- WAS DELETED. THE COMMISSIONER OF INCOME TAX (APPEALS) HAS DELETED THE A DDITION AFTER EXAMINATION OF DOCUMENTS ON RECORD. WE DO NOT FIND ANY ERROR IN DELETING THE AFORESAID ADDITION BY COMMISSIONER OF INCOME TA X (APPEALS). THE LD. DR HAS NOT BEEN ABLE TO CONTROVERT TH E FINDINGS OF 15 ITA NOS. 2074 & 2143/PN/2013, A.Y. 2003-04 COMMISSIONER OF INCOME TAX (APPEALS) ON THIS ISSUE. ACCORD INGLY, THIS GROUND OF APPEAL RAISED BY THE REVENUE IS DELETED BEING DEVOID OF MERIT . 21. THE GROUND NO. 6 IN THE APPEAL OF REVENUE HAS BEEN A DJUDICATED ALONG WITH THE APPEAL OF ASSESSEE IN PARA 10 ABOVE. THIS GROUND OF APPEAL OF THE REVENUE HAS BEEN DISMISSED FOR THE DETAILED REASONS GIVEN ABOVE. 22. IN GROUND NOS. 7, 8, 10 AND 11 OF THE APPEAL, THE RE VENUE HAS ASSAILED THE FINDINGS OF COMMISSIONER OF INCOME TAX (APPEALS) IN DELETING THE ADDITIONS MADE ON ACCOUNT OF UNEXPLAINED CASH DEPOSITS IN VARIOUS BANK ACCOUNTS OF THE ASSESSEE. A PERUSAL OF T HE IMPUGNED ORDER SHOWS THAT THE COMMISSIONER OF INCOME TAX (APPEALS ) HAD SOUGHT REMAND REPORT FROM THE ASSESSING OFFICER ON THE EXPLANATIO N FURNISHED BY THE ASSESSEE. HOWEVER, NO COMMENTS WERE OFFERED BY THE ASSESSING OFFICER ON THE GROUND THAT THE DETAILS AND EVIDENCE WERE NOT FURNISHED BY THE ASSESSEE. THE COMMISSIONER OF INCOME TAX (APPEALS ) HAS OBSERVED, THAT THE ASSESSING OFFICER HAS FAILED TO CONSIDER THE SUBMISSIONS OF THE ASSESSEE DATED 06.11.2006 WHEREBY THE ASSESSEE HAD GIVEN THE DETAILS OF VARIOUS BANK ACCOUNTS, CASH BOO KS AND OTHER RELEVANT DOCUMENTS. THE COMMISSIONER OF INCOME TAX (APPE ALS) FURTHER OBSERVED THAT THE ADDITIONS HAVE BEEN MADE ON ACCOUNT OF CASH DEPOSITS IN AN ARBITRARY MANNER. ALTHOUGH ASSESSMENT OR DER IS PASSED U/S. 143(3) BUT FACTUALLY THE ASSESSMENT HAS BEEN MADE A S BEST JUDGMENT ASSESSMENT U/S. 144 OF THE ACT. THE COMMISSIO NER OF INCOME TAX (APPEALS) AFTER ANALYZING THE DOCUMENTS AND E XPLANATION FURNISHED BY THE ASSESSEE HELD THAT THE ASSESSEE HAS B EEN ABLE TO EXPLAIN THE DEPOSITS IN THE BANK ACCOUNTS. 16 ITA NOS. 2074 & 2143/PN/2013, A.Y. 2003-04 22.1 IN SO FAR AS ADDITION OF RS.15,95,630/- IS CONCERNED THE COMMISSIONER OF INCOME TAX (APPEALS) HELD THAT AN AMOUNT O F RS.5,95,630/- AND RS.1,00,000/- ARE PART OF GROSS AGRICULTUR AL INCOME EARNED BY THE ASSESSEE DURING THE YEAR. THIS CONTENTI ON OF THE ASSESSEE WAS FOUND TO BE CORRECT AFTER VERIFICATION OF REC ORDS. ANOTHER SUM OF RS.5,00,000/- HAS BEEN ADDED AS CASH DEPOSITED IN CURRENT ACCOUNT NO. 57 WITH M/S. KARAD URBAN CO-OPERATIVE BANK LTD. ON VERIFICATION OF RECORDS IT WAS FOUND THAT THE SAID AMOUNT R EPRESENT LOCAL BILL PURCHASED BY THE BANK AND NOT THE CASH DEPOSITS. F URTHER IN THE BANK OF INDIA, WADALA, BOMBAY BRANCH CURRENT ACCOUNT NO . 3137 AN AMOUNT OF RS.70,000/-, 1,25,000/- AND RS.1,05,000/- HAVE BEE N DEBITED VIDE CHEQUE NOS. 292410, 292407 AND 292409 RESP ECTIVELY IN FAVOUR OF M/S. PIONEER STONES. THEREFORE, THESE AMOUNTS CANNOT BE SAID TO BE CASH DEPOSIT. REGARDING THE BALANCE TWO AMOU NTS OF RS.50,000/- EACH, THEY REPRESENT CASH DEPOSIT FROM INCOME FROM AGRICULTURE AND SALE OF JEWELLERY. THE COMMISSIONER OF INCOM E TAX (APPEALS) FINALLY CONCLUDED THAT NONE OF THE AMOUNTS AGGREG ATING RS.15,95,630/- CAN BE CONSIDERED AS UNEXPLAINED CASH DEPOSITS. 22.2 THE NEXT GROUND IS WITH RESPECT TO ADDITION OF RS.35,1 2,762/-. IN THE ASSESSMENT ORDER, THE COMMISSIONER OF INCOME TAX (AP PEALS) AFTER ANALYZING THE WORKING OF THE ASSESSING OFFICER AND THE EXP LANATION FURNISHED BY THE ASSESSEE HELD THAT AGAINST THE CASH RE CEIPTS OF RS.49,30,614/-, THE SOURCES FOR THE SAME ARRIVED AT BY TH E ASSESSING OFFICER IS RS.87,05,039/-. THUS, THERE IS NO CASH RECEIPT WHICH REMAINS UNEXPLAINED AND REQUIRES TO BE ADDED TO THE ASSESSEES INCOME. THUS, 17 ITA NOS. 2074 & 2143/PN/2013, A.Y. 2003-04 THE COMMISSIONER OF INCOME TAX (APPEALS) DELETED THE ENT IRE AMOUNT OF RS.35,12,762/- IN THE HANDS OF THE ASSESSEE. 22.3 THE REVENUE HAS ALSO ASSAILED THE FINDINGS OF COMMISSIO NER OF INCOME TAX (APPEALS) IN DELETING THE ADDITION OF RS.2,68,900/- ON ACCOUNT OF SUNDRY DEBTORS AS APPEARING IN THE ASSESSEE S SAVING BANK ACCOUNT NO. 141 WITH KARAD URBAN CO-OPERATIVE BANK. TH E COMMISSIONER OF INCOME TAX (APPEALS) HAS OBSERVED THAT TH E ASSESSING OFFICER HAS NOT GIVEN ANY SPECIFIC REASON FOR MAKING THE IMPU GNED ADDITIONS. THE AFORESAID AMOUNT REPRESENT TRANSFER FROM T HE SAVING BANK ACCOUNT OF SHRI NIWAS JADHAV, WHO WAS SALE AGENT OF THE ASSESSEE. NONE OF THE AMOUNT REPRESENTS CASH DEPOSITS AS ALLEGED. THE COMMISSIONER OF INCOME TAX (APPEALS) DELETED THE ADDITION A FTER EXAMINING THE BANK TRANSACTIONS. 22.4 AS REGARDS THE AMOUNT OF RS.3,22,000/- DELETED BY T HE COMMISSIONER OF INCOME TAX (APPEALS) IN RESPECT OF ASSESSEE S SAVING BANK ACCOUNT NO. 53057 WITH STATE BANK OF INDIA IS CONCE RNED THE COMMISSIONER OF INCOME TAX (APPEALS) HAS OBSERVED THAT T HERE ARE ONLY TWO CASH DEPOSITS AMOUNTING TO RS.55,000/-. THESE DEPOS ITS ARE FROM SALE OF JEWELLERY AND HAVE ALREADY BEEN DECLARED IN THE RE TURN OF INCOME. THE REST OF THE ENTRIES ARE EITHER WITHDRAWALS OR CHEQUES DEPOSITED OR TRANSFERS FROM THE OTHER BANK ACCOUNTS. A FTER THE FACTUAL VERIFICATION OF THE SAID BANK ACCOUNT THE COMMISSIONER OF I NCOME TAX (APPEALS) FOUND THAT THERE ARE NO CASH DEPOSITS IN THE SA ID BANK ACCOUNT. ON THE BASIS OF VERIFICATION OF BANK ACCOUNTS TH E COMMISSIONER OF INCOME TAX (APPEALS) DELETED THE ADDITION M ADE BY THE ASSESSING OFFICER. 18 ITA NOS. 2074 & 2143/PN/2013, A.Y. 2003-04 IN RESPECT OF ALL THE ABOVE FOUR ADDITIONS, THE LD. DR HAS N OT BEEN ABLE TO SHOW FROM RECORDS ANY ERROR IN THE FINDINGS OF THE COMMISSIONER OF INCOME TAX (APPEALS). WE OBSERVE THAT THE COMMISSIONER OF INCOME TAX (APPEALS) HAS DELETED THE ADDITIO NS AFTER VERIFICATION OF THE BANK ACCOUNT AND THE TRANSACTIONS. TH E ASSESSING OFFICER HAD MADE ADDITION IN AN ARBITRARY AND UNJUSTIFIED MAN NER WITHOUT VERIFYING THE BANK ACCOUNTS OF THE ASSESSEE. TH E COMMISSIONER OF INCOME TAX (APPEALS) HAS OBSERVED IN HIS OR DER THAT THE ASSESSING OFFICER HAS DELIBERATELY IGNORED THE INFORMATIO N FURNISHED BY THE ASSESSEE. THE EXERCISE WHICH ASSESSING OFFICER HA S FAILED TO PERFORM HAS BEEN DONE BY THE COMMISSIONER OF INCOME TAX (APPEALS). THUS, IN VIEW OF FACTUAL FINDINGS GIVEN BY THE COMMISSIONER O F INCOME TAX (APPEALS) AFTER EXAMINATION OF BANK ACCOUNTS AND OTHE R RELEVANT DOCUMENTS, WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF COMM ISSIONER OF INCOME TAX (APPEALS) IN DELETING THE ADDITIONS IN RESPECT OF UNEXPLAINED CASH CREDIT IN THE BANK ACCOUNTS OF THE ASSESSEE. 23. IN GROUND NO. 9 OF THE APPEAL, THE DEPARTMENT HAS AS SAILED THE FINDINGS OF THE COMMISSIONER OF INCOME TAX (APPEALS) IN PARTL Y DELETING THE ADDITION ON ACCOUNT OF UNEXPLAINED CASH DEPOSITS TO T HE EXTENT OF RS.15,91,270/- FROM THE DEBTORS. THIS GROUND OF APPEAL HA S ALREADY BEEN ADJUDICATED ALONG WITH THE APPEAL OF THE ASSESSEE IN PARA 13 ABOVE. FOR THE REASONS GIVEN THEREIN, THIS GROUND OF A PPEAL OF THE REVENUE IS DISMISSED. 24. GROUND NOS. 12 AND 13 OF THE APPEAL OF THE REVENUE A RE GENERAL IN NATURE, HENCE, REQUIRE NO ADJUDICATION. 19 ITA NOS. 2074 & 2143/PN/2013, A.Y. 2003-04 25. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISMISSED B EING DEVOID OF ANY MERIT. ORDER PRONOUNCED ON FRIDAY, THE 23 RD DAY OF OCTOBER, 2015. SD/- SD/- ( . . / R.K. PANDA) ( ! ' / VIKAS AWASTHY) #' / ACCOUNTANT MEMBER $ % #' / JUDICIAL MEMBER / PUNE; &# / DATED : 23 RD OCTOBER, 2015 RK *+,%-.#/#)- / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT. 2. / THE RESPONDENT. 3. ' () / THE CIT(A)-III, PUNE 4. ' / THE CIT-III, PUNE 5. !*+ %%,- , ,- , . ./0 , / DR, ITAT, B BENCH, PUNE. 6. + 1 23 / GUARD FILE. / // ! % // TRUE COPY// #4 / BY ORDER, %5 ,0 / PRIVATE SECRETARY, ,- , / ITAT, PUNE