ASHOK P VANANI, MUMBAI V. ACIT (OSD) 1 CEN RG 7, MUMBAI

ITA 6178/MUM/2010

• Counselvise Citation: 617819914 RSA 2010
• Duration Of Justice: 1 year(s) 4 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-12-2011
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: SMC
• Next Hearing Date: 30-11-2011
• Assessment Year: 2001-2002
• Appeal Filed On: 12-08-2010
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: SUBACHAN RAM
• Assessee Lawyers: SATISH R MODY
• Keywords: Gift; Salary income

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES SMC , MUMBAI BEFORE SHRI RAJENDRA SINGH, AM ITA NOS. : 6178 TO 6184/MUM/2010 ASSESSMENT YEARS : 2001-02 TO 2007-08 SHRI ASHOK P. VANA NI B/704, DEEPASHRI BLDG, NEAR SPORTS COMPLEX, ANDHERI (W), MUMBAI-400 053 PAN NO: ACUPV 2909 B VS. ACIT (OSD) - 1, CENTRAL RANGE 7 AAYKAR BHAVAN, M.K. ROAD, MUMBAI-400 020. (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI SATISH R. MODY RESPONDENT BY : SHRI SUBACHAN RAM DATE OF HEARING : 30 .11.2011 DATE OF PRO NOUNCEMENT : 14.12.2011 ORDER PER RAJENDRA SINGH (AM) : THESE APPEALS BY THE ASSESSEE ARE DIRECTED AGAINST DIFFERENT ORDERS ALL DATED 04.06.2010 OF CIT(A), MUMBAI FOR T HE ASSESSMENT YEARS 2001-02 TO 2007-08. THE MAIN DISPUTE RAISED I N ALL THE APPEALS IS REGARDING ADDITION ON ACCOUNT OF UNDISCLOSED INC OME. ALL THESE APPEALS ARE, THEREFORE, BEING DISPOSED OF BY A SING LE CONSOLIDATED ORDER FOR THE SAKE OF CONVENIENCE. 2. WE FIRST TAKE UP THE MAIN DISPUTE WHICH IS REGA RDING THE ADDITION ON ACCOUNT OF UNDISCLOSED INCOME, WHICH IS COMMON IN ALL THE YEARS. THE FACTS IN BRIEF ARE THAT A SEARCH HAD BEE N CONDUCTED ITA NOS : 6178 TO 6184/MUM/2010 SHRI ASHOK P. VANANI 2 U/S.132(1) OF THE I.T. ACT. IN CASE OF NIRU IMPEX O N 04.10.2006. THE ASSESSEE IS A COUSIN OF SHRI GOVERDHAN G. VANANI, T HE MAIN PARTNER OF NIRU IMPEX. DURING THE COURSE OF SEARCH ACTION, LOC KER NO 122 AND 1867 IN SRI SARDAR LAXMI SAFE VAULTS LTD. AND LOCK ER NO. 1431 IN NAYAN SAFE DEPOSIT VAULTS PVT. LTD WERE FOUND, IN W HICH TOTAL CASH FOUND WAS `. 1.99 CRORES. IN ADDITION, TWO CHITS WERE ALSO FOUND IN LOCKER NO.1431, CONTAINING THE DETAILS OF TRANSACTI ONS TOTALING TO `. 1.99 CRORES. SHRI GOVERDHAN G. VANANI IN THE STATEMENT R ECORDED AT THE TIME OF THE SEARCH EXPLAINED THAT THE CASH OF `. 1.99 CRORE BELONGED TO NIRU IMPEX, WHICH WAS UNACCOUNTED. IT WAS ALSO ADMI TTED THAT NIRU IMPEX HAD RECEIVED THE CASH AGAINST CHEQUES ISSUED TO M/S. PUJAN IMPEX AND M/S. MARVEL IMPEX, AGAINST FAKE BILLS. TH E CASH OF `. 1.99 CRORES HAD ACCORDINGLY, BEEN OFFERED BY NIRU IMPEX AS ADDITIONAL INCOME OF THE FIRM. SHRI GOVERDHAN G. VANANI ALSO S TATED THAT THE TRANSACTIONS MENTIONED IN THE TWO CHITS RELATED TO THE CASH OF `. 1.99 CRORES FOUND FROM THE LOCKERS. SINCE, THE LOCKERS W ERE IN THE NAME OF THE ASSESSEE, THE PROCEEDINGS U/S.153A HAD BEEN INI TIATED IN THE CASE OF THE ASSESSEE. THERE WAS NO ADDITION MADE IN CASE OF THE ASSESSEE ON ACCOUNT OF ANY DOCUMENTS FOUND DURING THE SEARCH, I NCOME FROM WHICH HAD BEEN ACCEPTED AS BELONGING TO NERU IMPEX. 2.1 THE AO, HOWEVER, FOUND THAT THE ASSESSEE HAD DE CLARED THE INCOME FROM COMMISSION AND BROKERAGE IN DIAMOND BUS INESS. THE ASSESSEE, HOWEVER, HAD NOT MAINTAINED ANY ACCOUNTS IN RESPECT OF SUCH INCOME. THE ASSESSEE DID NOT EVEN GIVE THE NAM ES AND ADDRESSES OF THE PARTIES FROM WHICH THE INCOME HAD BEEN RECEI VED AND COULD ALSO NOT EXPLAIN AS TO HOW THE ASSESSEE HAD COMPUTED THE INCOME IN RESPECT OF THE COMMISSION BUSINESS. THERE WAS ALSO NO EVIDENCE TO SUBSTANTIATE THE INCOME. THE AO, THEREFORE, DETERMI NED THE INCOME FROM COMMISSION/BROKERAGE ESTIMATE. THE AO ALSO OBS ERVED THAT THE ITA NOS : 6178 TO 6184/MUM/2010 SHRI ASHOK P. VANANI 3 DRAWINGS FOR THE PERSONAL EXPENSES SHOWN BY THE FAM ILY WERE NOT ADEQUATE. THE FAMILY CONSISTED OF HIMSELF, WIFE AND TWO SCHOOL GOING CHILDREN. THE ASSESSEE WAS LIVING IN A POSH AREA. T HE ASSESSEE HAD NOT FURNISHED THE DETAILS OF EXPENSES INCURRED ON ELECT RICITY, DOMESTIC SERVANTS, MOBILE PHONES, TUITION FEES AND EXPENSES INCURRED ON PURCHASE OF BOOKS, UNIFORM AND TRANSPORTATION OF CH ILDREN, WHICH WAS SPECIFICALLY ASKED VIDE QUESTIONNAIRE DATED 23.03.2 008. HE, THEREFORE, CONCLUDED THAT THE DRAWING DECLARED BY THE ASSESSEE WAS NOT ADEQUATE, AS THE WIFE HAD NOT MADE ANY CONTRIBUTION TO THE PERSONAL DRAWINGS. AO, HOWEVER, DID NOT MADE ANY SEPARATE AD DITION ON ACCOUNT OF LOW PERSONAL EXPENSES, ON THE GROUND THA T THE SAME WAS COVERED BY THE ADDITION MADE BY HIM ON ACCOUNT OF U NDISCLOSED INCOME. THE DETAILS OF INCOME DECLARED BY THE ASSES SEE FROM BROKERAGE/COMMISSION, DRAWING FOR PERSONAL EXPENSES , INCOME ESTIMATED BY THE AO IN RESPECT OF BROKERAGE/COMMISS ION INCOME, ADDITION MADE ON ACCOUNT OF UNDISCLOSED INCOME ARE GIVEN IN THE TABLE BELOW :- A. Y. INCOME FROM BROKERAGE/CO MMISSION AS PER RETURN PERSONAL DRAWINGS SHOWN BY THE ASSESSEE INCOME/BROKERAGE COMMISSION ESTIMATED BY THE AO ADDITION ON ACCOUNT OF UNDISCLOSED INCOME 2001-02 `. 53,000 NIL `. 2 LAKHS `. 1,47,000 2002-03 `. 68,426 `. 62,500 `. 1.50 LAKHS `. 81,754 2003-04 `. 1,04,742 `. 52,950 `. 2 LAKHS `. 95,258 2004-05 `. 68,266 `. 81,314 `. 2 LAKHS `. 1,31,734 2005-06 `. 67,141 `. 91,854 `. 2 LAKHS `. 1,32,858 2006-07 `. 1,44,681 `. 92,740 `. 3 LAKHS `. 1,55,319 2007-08 `. 95,600 `. 1,01,275 `. 3 LAKHS `. 2,04,200 3. THE ASSESSEE DISPUTED THE DECISION OF THE AO AND SUBMITTED BEFORE THE CIT(A) THAT THE TRANSACTIONS IN THE BROK ERAGE INCOME WERE SMALL AND NOT RECURRING IN NATURE AND, THEREFORE, D ETAILS WERE NOT AVAILABLE AND THERE WAS ALSO NO DOCUMENTARY EVIDENC ES. IT WAS ALSO SUBMITTED THAT IT WAS NOT MANDATORY FOR THE ASSESSE E TO MAINTAIN ITA NOS : 6178 TO 6184/MUM/2010 SHRI ASHOK P. VANANI 4 ACCOUNTS. THE ASSESSEE ALSO POINTED OUT THAT THE AD DITIONS MADE BY THE AO ARE WITHOUT ANY BASIS. CIT(A) HOWEVER, DID NOT ACCEPT THE CONTENTIONS RAISED. IT WAS OBSERVED BY HIM THAT IT WAS NOT ACCEPTABLE THAT THE ASSESSEE DID NOT KEEP THE BASIC DETAILS SU CH AS NAME AND ADDRESSES OF THE PARTIES. SUCH BASIC RECORDS ARE RE QUIRED TO BE KEPT FOR ASSESSEES OWN BUSINESS NEEDS. HE, THEREFORE, AGREE D WITH THE AO THAT THE INCOME DECLARED BY THE ASSESSEE COULD NOT BE RE LIED UPON. CIT(A) ALSO OBSERVED THAT THE ADDITION MADE BY AO ON ESTIM ATE WAS SUPPORTED BY LOW WITHDRAWAL FOR FAMILY EXPENSES. HE , THEREFORE, CONFIRMED THE ADDITION MADE BY THE AO AS UNDISCLOSE D INCOME IN RESPECT OF BROKERAGE/COMMISSION INCOME IN ALL THE Y EARS. AGGRIEVED BY THE SAID DECISION, THE ASSESSEE IS IN APPEAL BEFORE THE TRIBUNAL. 4. AT THE TIME OF HEARING OF THE APPEAL BEFORE THE TRIBUNAL, THE LD. AR FOR THE ASSESSEE SUBMITTED THAT THERE WAS NO INC RIMINATING MATERIAL FOUND DURING THE SEARCH RELATING TO THE AS SESSEE. HOWEVER, HE DID NOT QUESTION THE JURISDICTION OF THE AO U/S.153 A TO MAKE THE ASSESSMENT IN CASE OF THE ASSESSEE. IT WAS ALSO MAD E CLEAR BY HIM THAT HE WAS NOT RAISING THE LEGAL ISSUE AS TO WHETHER IN THE ABSENCE OF ANY INCRIMINATING MATERIAL FOUND DURING THE SEARCH, ASS ESSMENT CAN BE MADE U/S.153A. HOWEVER, HE DISPUTED THE ADDITION MA DE BY THE AO, ON THE GROUND THAT THE SAME WAS NOT BASED ON ANY MA TERIAL AND THERE WAS NO PROPER BASIS. IT WAS ARGUED THAT EVEN THE ES TIMATION OF INCOME HAS TO BE BASED ON SOME MATERIAL, BUT IN THIS CASE THERE WAS NO BASIS. IT WAS SUBMITED, THAT THE ASSESSEE BELONGED TO LOW INCOME GROUP AND WAS LIVING IN A RENTAL FLAT AT CHANDRA APARTMENT IN BORIVALI (W), FOR WHICH MONTHLY RENT OF `. 2,500/- WAS BEING PAID, WHICH WAS ALSO MENTIONED IN THE STATEMENT MADE TO THE DEPARTMENT. IT WAS ACCORDINGLY SUBMITTED THAT THE PERSONAL DRAWINGS SH OWN BY THE ASSESSEE SHOULD BE ACCEPTED AS REASONABLE. ITA NOS : 6178 TO 6184/MUM/2010 SHRI ASHOK P. VANANI 5 4.1 THE LD. DR, ON THE OTHER HAND, STRONGLY SUPPORT ED THE ORDERS OF THE AUTHORITIES BELOW. IT WAS ARGUED THAT THE LOCKE R HAD BEEN FOUND IN THE NAME OF THE ASSESSEE AND, THEREFORE, THERE WAS JURISDICTION TO MAKE AN ASSESSMENT U/S.153A. EVEN THOUGH THE MATERI AL FOUND IN THE LOCKER BELONGED TO SOME OTHER PERSONS, THE ASSESSEE WAS PROVIDING ACCOMMODATION TO HIS RELATIVES IN RELATION TO UNACC OUNTED TRANSACTION AND, THEREFORE, HE WAS DEFINITELY HAVING SOME UNACC OUNTED INCOME. EVEN IF THE ASSESSEE WAS NOT REQUIRED TO MAINTAIN A CCOUNTS, HE WAS DEFINITELY REQUIRED TO GIVE THE BASIS FOR COMPUTATI ON OF INCOME FROM BROKERAGE AND IT CANNOT BE ACCEPTED THAT THE ASSESS EE HAD NO DETAILS TO COMPUTE THE INCOME FOR DECLARATION BEFORE THE DE PARTMENT. IT WAS ALSO POINTED OUT THAT THE ASSESSEE WAS LIVING IN A POSH AREA LIKE BORIVALI (W) IN A FLAT AND CONSIDERING THE SIZE AND STATUS OF FAMILY, THE DRAWINGS SHOWN WERE INADEQUATE AND ESTIMATION OF UN ACCOUNTED INCOME WAS THUS JUSTIFIED. 5. I HAVE PERUSED THE RECORDS AND CONSIDERED THE RI VAL CONTENTIONS CAREFULLY. THE DISPUTE IS REGARDING THE ESTIMATION OF INCOME FROM COMMISSION/BROKERAGE DECLARED BY THE ASSESSEE IN RE LATION TO THE DIAMOND BUSINESS. A SEARCH HAD BEEN CONDUCTED IN CA SE OF NERU IMPEX GROUP BELONGING TO ONE OF THE COUSINS OF THE ASSESSEE DURING THE COURSE OF WHICH LOCKERS IN THE NAME OF THE ASSE SSEE WERE FOUND. THOUGH THE DOCUMENTS AND CASH FOUND IN THE LOCKERS DID NOT BELONG TO THE ASSESSEE AND THE INCOME RELATING THERE TO HAD B EEN ADMITTED BY NERU IMPEX, AND NO ADDITION ON THAT ACCOUNT HAD BEE N MADE, IN CASE OF THE ASSESSEE, THE PROCEEDINGS U/S.153A WERE INIT IATED IN THE CASE OF THE ASSESSEE ON THE BASIS OF LOCKER FOUND IN HIS NA ME. THE ISSUE AS TO WHETHER ANY ADDITION CAN BE MADE IN THE ASSESSMENT YEAR U/S.153A WITHOUT ANY INCRIMINATING DOCUMENTS HAVING BEEN FOU ND IN SEARCH, IS S DEBATABLE ISSUE AND THERE ARE CONTRARY DECISIONS OF THE TRIBUNAL AND ITA NOS : 6178 TO 6184/MUM/2010 SHRI ASHOK P. VANANI 6 THE MATTER IS PENDING FOR ADJUDICATION BEFORE SPECI AL BENCH IN THE CASE OF M/S. ALLEARGO GLOBAL LOGISTICS LTD. THE LD. AR F OR THE ASSESSEE DID NOT RAISE ANY SUCH LEGAL ISSUE. HE DID NOT CHALLENG E THE JURISDICTION U/S.153A TO MAKE ADDITION EVEN IN THE ABSENCE OF IN CRIMINATING MATERIAL. 5.1 HOWEVER, THE LD. AR HAS CHALLENGED THE BASIS OF ADDITION MADE BY THE AO. THE ASSESSEE HAD DECLARED THE INCOME FRO M COMMISSION/BROKERAGE IN THE DIAMOND BUSINESS, FOR W HICH NO ACCOUNTS WERE MAINTAINED. IT WAS SUBMITTED THAT SIN CE THE INCOME WAS SMALL, THE CASE OF THE ASSESSEE WAS NOT COVERED BY THE PROVISION OF SECTION 44AA AND THE ASSESSEE WAS NOT REQUIRED TO M AINTAIN THE ACCOUNTS AND, THEREFORE, INCOME DECLARED SHOULD HAV E BEEN ACCEPTED. I AM UNABLE TO ACCEPT THE PLEA AND NO ADDITION CAN BE MADE. EVEN IF THE ASSESSEE WAS NOT REQUIRED TO MAINTAIN PROPER ACCOUN TS, HE WAS REQUIRED TO GIVE THE DETAILS AS TO HOW THE INCOME H AD BEEN COMPUTED BY HIM. THE ASSESSEE DID NOT PRODUCE EVEN THE BASIC DETAILS SUCH AS NAME AND ADDRESS OF THE PARTIES WITH WHOM THE BUSIN ESS HAD BEEN DONE, THE EXPENSES CLAIMED ETC. UNDER THESE CIRCUMS TANCES, THE ESTIMATION OF INCOME BY THE AO IS JUSTIFIED. HOWEVE R, IT IS A SETTLED LEGAL POSITION THAT EVEN WHILE MAKING THE ESTIMATE, SOME BASIS HAS TO BE GIVEN FOR THE ESTIMATION OF THE INCOME. IN THIS CASE, THE AO HAS SUPPORTED HIS ESTIMATION OF INCOME BY THE LOW FAMIL Y WITHDRAWALS SHOWN BY THE ASSESSEE BECAUSE, IN CASE, THE WITHDRA WALS ARE REALLY FOUND TO BE LOW, THE ASSESSEE DEFINITELY HAD SOME U NACCOUNTED INCOME TO MEET FAMILY EXPENSES. THEREFORE, THE ISSUE IS BA SICALLY REGARDING ESTIMATION OF PERSONAL EXPENSES OF THE FAMILY. 5.2 THERE IS NO DISPUTE THAT THE ASSESSEEE WAS LIVI NG IN A GOOD LOCALITY IN BORIVALI (W) IN A RENTED FLAT IN CHANDR A APARTMENT. THERE IS ITA NOS : 6178 TO 6184/MUM/2010 SHRI ASHOK P. VANANI 7 ALSO NO DISPUTE THAT THE FAMILY OF THE ASSESSEE CON SISTED OF HIS WIFE AND TWO SCHOOL GIVING CHILDREN AND THE WIFE HAD MAD E NO CONTRIBUTION TO THE FAMILY DRAWING. THE ASSESSEE WAS PAYING RENT OF `. 2,500/- PER MONTH. THE ASSESSEE DID NOT FURNISH THE DETAILS OF EXPENSES SUCH AS SCHOOL FEES, EXPENSES ON BOOKS, UNIFORM AND TRANSPO RTATION OF HIS SCHOOL GOING CHILDREN AS WELL AS ELECTRICITY CHARGE S AND MOBILE PHONE EXPENSES ETC. UNDER THESE CIRCUMSTANCES, ESTIMATION OF HIS DRAWINGS FOR PERSONAL EXPENSES, IS JUSTIFIED. THE ASSESSEE W AS IN THE BUSINESS OF BROKERAGE/COMMISSION IN DIAMOND BUSINESS SINCE THE BEGINNING. HE WAS ALSO EARNING SALARY INCOME FROM ASSESSMENT YEAR 2004-05 ONWARDS, EXCEEDING `. 5,000/- PER MONTH. THE ASSESSEE HAD ALSO STARTED TRADING IN DIAMONDS FROM THE ASSESSMENT YEA R 2006-07 AND HAD DECLARED INCOME OF `. 56,163/- AND `. 2,53,841/- RESPECTIVELY IN THESE TWO YEARS U/S.44AF. CONSIDERING THE SIZE OF T HE FAMILY AND TWO SCHOOL GOING CHILDREN AND THE DECENT LOCALITY IN WH ICH THE ASSESSEE LIVING, IN MY VIEW, FAMILY EXPENSES CANNOT BE LESS THAN `. 10,000/- PER MONTH IN THE ASSESSMENT YEAR 2001-02. I, THEREFORE, ESTIMATE THE FAMILY EXPENSES OF THE ASSESSEE AT `. 10,000/- PER MONTH IN THE ASSESSMENT YEAR 2001-02; `. 10,500/- P.M. IN THE ASSESSMENT YEAR 2002-03; `. 11,000/- P.M. IN THE ASSESSMENT YEAR 2003-04; `. 12,000/- P.M. IN THE ASSESSMENT YEAR 2004-05; `. 12,500/- P.M. IN THE ASSESSMENT YEAR 2005-06; `. 13,000/- P.M. IN THE ASSESSMENT YEAR 2006-07 AND `. 15,000/- P.M. IN THE ASSESSMENT YEAR 2007-08. THE DIFFERENCE OF THE DRAWINGS ESTIMATED ABOVE AND THE FAMILY DRAWINGS DECLARED BY THE ASSESSEE DETAILS OF WHICH HAVE BEEN GIVEN EARLIER, WILL BE THE UNDISCLOSED INCOME OF THE ASSESSEE FROM BROK ERAGE AND COMMISSION IN DIAMOND BUSINESS. I, THEREFORE, SET A SIDE THE ORDER OF CIT(A) AND DIRECT THE ASSESSING OFFICER TO COMPUTE THE UNDISCLOSED INCOME FROM BROKERAGE/COMMISSION INCOME AS MENTIONE D ABOVE. ITA NOS : 6178 TO 6184/MUM/2010 SHRI ASHOK P. VANANI 8 6. IN THE ASSESSMENT YEAR 2005-06, THERE IS AN ADDI TIONAL GROUND OF ADDITION OF `. 1,81,000/-, ON ACCOUNT OF CASH DEPOSITS IN THE BANK ACCOUNT. THE AO NOTED THAT THE CASH TOTALLING TO `. 1,81,000/- HAD BEEN DEPOSITED ON FOUR DIFFERENT DATES FROM 20.01.2 005 TO 27.01.2005 IN CANARA BANK. THE ASSESSEE COULD NOT EXPLAIN THE SOURCE OF DEPOSIT. THE AO, THEREFORE, ADDED THE SAME AS INCOME OF THE ASSESSEE FROM UNDISCLOSED SOURCES. THE ASSESSEE SUBMITTED BEFORE THE CIT(A) THAT DEPOSITS WERE OUT OF PAST EARNINGS AND CUSTOMARY GI FTS. IT WAS ALSO SUBMITTED THAT AS ON 31.03.2002, THE ASSESSEE HAD A CCUMULATED SAVINGS OF `. 2,50,000/-. CIT(A) HOWEVER, DID NOT ACCEPT THE EXPLANATION, AS THE DEPOSITS HAD BEEN MADE WITHIN A SHORT SPAN OF ONE WEEK. HE, THEREFORE, CONFIRMED THE ADDITION MADE BY THE ASSESSING OFFICER AGGRIEVED BY WHICH THE ASSESSEE IS IN APPEA L BEFORE THE TRIBUNAL. 7. BEFORE ME, THE LD. AR FOR THE ASSESSEE REITERATE D THE SUBMISSIONS MADE BEFORE THE LOWER AUTHORITIES, WHER EAS THE LD. DR PLACED RELIANCE ON THE FINDINGS GIVEN IN THE ORDERS OF THE AUTHORITIES BELOW. 7.1 I HAVE PERUSED THE RECORDS AND CONSIDERED THE M ATTER CAREFULLY. THE DISPUTE IS REGARDING THE ADDITION OF `. 1,81,000/- ON ACCOUNT OF CASH DEPOSITS IN THE BANK ACCOUNT OF THE ASSESSEE. THE DEPOSITS HAD BEEN MADE ON FOUR DAYS DURING 20.01.2005 TO 27.01.2 005. THE ASSESSEE HAD EXPLAINED DEPOSITS OUT OF PAST SAVINGS AND CUSTOMARY GIFTS. THERE IS NO EVIDENCE OF CUSTOMARY GIFTS. FUR THER, THE ASSESSEE HAD SUBMITTED THAT IT HAD CASH SAVINGS OF `. 2.50 LAKHS AS ON 31.03.2002, BUT IT HAS NOT EXPLAINED AS TO HOW SUCH HUGE AMOUNT REMAINED IN CASH, WHEN THE ASSESSEE WAS MAINTAINING BANK ACCOUNT. THEREFORE, IN MY VIEW, THE EXPLANATION OF THE ASSES SEE THAT CASH ITA NOS : 6178 TO 6184/MUM/2010 SHRI ASHOK P. VANANI 9 DEPOSITS WERE OUT OF PAST SAVINGS AND CUSTOMARY GIF TS HAS BEEN RIGHTLY REJECTED BY THE AUTHORITIES BELOW. I ACCORDINGLY, C ONFIRM THE ADDITION MADE BY AO AND UPHELD BY CIT(A). 8. IN THE ASSESSMENT YEAR 2007-08 ALSO, THERE IS AD DITIONAL GROUND OF ADDITION OF `. 36,000/-, ON ACCOUNT OF CASH CREDIT. THE ASSESSEE EXPLAINED BEFORE THE AO THAT THE CASH CREDIT CONSIS TED OF TWO CASH LOANS OF `. 18,000/- EACH FROM SHRI KALPESH V. VIRICHIA AND SHR I CHETAN BHANI V. SAPOTA. THE ASSESSEE FILED CONFIRMA TIONS, BUT COULD NOT PROVE THE CAPACITY OF THE CREDITORS. IN APPEAL, CIT(A) OBSERVED THAT THE CREDITORS WERE NOT ASSESSED TO TAX AND THEIR CA PACITY TO ADVANCE CASH LOANS WAS NOT SUPPORTED BY ANY EVIDENCE. HE, T HEREFORE, CONFIRMED THE ADDITION AGGRIEVED BY WHICH THE ASSES SEE IS IN APPEAL BEFORE THE TRIBUNAL. 8.1 I HAVE HEARD BOTH THE PARTIES, PERUSED THE RECO RDS AND CONSIDERED THE MATTER CAREFULLY. BEFORE ME ALSO, NO MATERIAL HAS BEEN PRODUCED TO PROVE THE CAPACITY OF THE TWO CREDITORS . I, THEREFORE, SEE NO INFIRMITY IN THE ORDER OF THE CIT(A) IN CONFIRMING THE ADDITION MADE BY THE AO AND THE SAME IS, THEREFORE, UPHELD. 9. IN THE RESULT, ALL THE APPEALS OF THE ASSESSEE A RE PARTLY ALLOWED. ORDER PRONOUNCED ON THIS 14 TH DAY OF DECEMBER, 2011. SD/ - ( RAJENDRA SINGH ) ACCOUNTANT MEMBER MUMBAI, DT: 14/12/2011 ITA NOS : 6178 TO 6184/MUM/2010 SHRI ASHOK P. VANANI 10 COPY FORWARDED TO : 1. THE APPELLANT, 2. THE RESPONDENT, 3. THE C.I.T. 4. CIT (A) 5. THE DR, SMC - BENCH, ITAT, MUMBAI //TRUE COPY// BY ORDER ASSISTANT REGISTRAR ITAT, MUMBAI BENCHES, MUMBAI ROSHANI