PAWAN KUMAR, AMBALA, HARYANA V. INCOME TAX OFFICER WARD-3 AMBALA, AMBALA CANTT

ITA 626/CHANDI/2023

• Counselvise Citation: [2024] 100 COUNSELVISE.COM (IT) 0077 (ITAT-CHANDIGARH)
• Duration Of Justice: 9 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-08-2024
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 28-05-2024
• Assessment Year: 2017-2018
• Appeal Filed On: 17-10-2023
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Business income; Tax effect; TDS; FORM 26AS
• Section: 69B; 69A; 22

Judgement Text

आयकर अपील य अ धकरण,च डीगढ़ यायपीठ, च डीगढ़ IN THE INCOME TAX APPELLATE TRIBUNAL DIVISION BENCH, “B” CHANDIGARH BEFORE: SHRI A.D.JAIN, VICE PRESIDENT AND SHRI KRINWANT SAHAY, ACCOUNTANT MEMBER आयकर अपील सं./ITA No.626/CHD/2023 नधा रण वष / Assessment Year : 2017-18 Shri Pawan Kumar, Prop. Hakim Ram Siri Ram, 130, New Anaj Mandi, Ambala City. Vs The ITO, Ward – 3, Ambala. थायीलेखासं./PAN NO: ACEPK7933L अपीलाथ /Appellant यथ /Respondent नधा रती क ओर से/Assessee by : Shri Rohit Goel, CA राज व क ओर से/ Revenue by : Shri Dharam Vir, JCIT, Sr.DR स ु नवाई क तार"ख/Date of Hearing : 29.05.2024 उदघोषणा क तार"ख/Date of Pronouncement : 14.08.2024 HYBRID HEARING आदेश/Order PER A.D.JAIN, VICE PRESIDENT The present appeal has been preferred by the assessee against the order dated 04.09.2023 passed by the ld. Commissioner of Income Tax (Appeals) NFAC, Delhi [hereinafter referred to as ‘ld.CIT(A)’], pertaining to 2017-18 assessment year. 2. The assessee in this appeal has raised the following grounds of appeal : ITA No.626/CHD/2023 A.Y. 2017-18 2 1. That the learned CIT(A) has erred in law and on facts in confirming the actions of learned AO of treating cash of Rs. 21,00,000/- deposited as unexplained income u/s 69A r.w. section 115BBE of the Act. (Tax effect=Rs.21,50,382/-) 2. That the learned CIT(A) has erred in law and on facts in confirming the actions of AO of treating cash sales deposit of Rs. 21,00,000/- as unexplained income u/s 69A ignoring the fact that deposited cash is duly recorded in Cash Book. 3. That the learned CIT(A) has erred in law and on facts in not admitting the documents submitted along with application under rule 46A of the Income Tax Rules. 3. As per the Assessing Officer, return of income for the Assessment Year 2017-18 was e-filed on 08.11.2017 declaring an income of Rs.2,20,660/- as Income from business & profession. The case was selected for limited scrutiny through CASS under reason "large cash deposits in bank account(s) during the year". Information under Section 133(6) had been called for from the bank and placed on record. On perusal of the bank account, it was revealed that the assessee had deposited cash of Rs. 21 lakh in the bank account during the year. The assessee was show caused to explain the source of the cash deposit alongwith documentary evidence on specified dates. In response to the notices, the assessee furnished copy of cash book and bank statements by stating that the cash is out of cash balance as per his cash book. The assessee was asked to ITA No.626/CHD/2023 A.Y. 2017-18 3 substantiate these cash deposit entries with documentary evidence and also to provide the names of the persons with complete addresses from whom the cash had been received. But the assessee failed to provide the same. On perusal of the return, it was seen that the assessee was a commission agent but had filed the return under Section 44AD, which is not applicable for the commission income. A final show cause notice dated 13.11.2019 was issued and the assessee was asked to produce the books of account and to reconcile the same with documentary evidence and to produce the persons from whom the cash had been received, failing which, to show cause as to why the amount of Rs.21,00,000/- may not be added to the income. As the assessee had not furnished any documentary evidence regarding the source of the cash deposit inspite of repeated opportunities, the entire amount of cash deposit of Rs.21,00,000/- was treated as income of the assessee from unexplained sources under Section 69A of the Income Tax Act and was added to the income of the assessee for the assessment year 2017-18. The total income assessed was taxed under Section 115BBE of the Act. 4. Before the ld. CIT(A), the assessee made the following ITA No.626/CHD/2023 A.Y. 2017-18 4 written submissions : "Assessee Sh. Pawan Kumar is engaged in the business of commission agent (Kacha Ahrtiya) as proprietor of the firm M/s Hakam Rai Siri Ram. The Assessee undertakes the sale of agricultural produce of farmers to Govt. Agencies and private parties and after collecting the payments from purchasers (which are mainly Govt. Agencies), makes onward payments to farmers (inspite of the fact that commission is charged from purchaser, Assessee charge commission @ 2.5% from the purchaser. To earn the commission assessee facilitates the farmers in the following counts so that farmer bring his produce to Assessee's shop. 1. Advances to farmers for their agricultural and domestic requirements. 2. Facilitates to sell their produce at maximum rates. 3. Makes the payment to farmers after collecting it from the purchaser. During the period 01.04.16 to 31.03.17 the assessee earned a commission of Rs.3,53,552/-. Thus the assessee has sold the goods worth Rs. 1,46,21,944/- of agricultural produce on behalf of the fanners, out of which, Govt. Sale is Rs. 1,36,21,003/- which comes to 93.15% of total sales. 4. During normal course of business assessee receives the payment from Govt. Agencies by bank and after receipt of payment, assessee makes the payment to the famers. 6. Sometimes paddy and wheat is also sold by the farmers through another commission agent or at another station. He pays back the amount in cash after receiving the sales proceeds of his produce as sugarcane, prali or vegetables etc. 7. Sometimes farmers sale proceeds remain un-sufficient/short to meet out the advances given to him then in that case farmer repays the remaining balance standing in his account in Cash by raising the loan from KCC Bank account. 8. Farmer who raised agricultural loan through kisan credits card repays bank loan after every crop and avail the loan to repay assessee's loan in cash. Thus during the year under consideration assessee has deposited Rs.21 lacs in cash in his bank account which was out of withdrawal from the same bank or out of receipt from farmers. ITA No.626/CHD/2023 A.Y. 2017-18 5 All the above payments are duly reconciled with the books of account of the assessee. The assessee maintains regular books of accounts i.e. cash book, ledger, stock register, market fees records and GST records. Photocopy of bank statement is enclosed at 1. Affidavit of Sh. Balbir Singh s/o Dhyan Singh, Village Dadlana attached at 2. Affidavit of Sh. Balbir Singh S/o Balwant Singh, Village Khaspura attached 3. Affidavit of Sh. Manoj Kumar S/o Jagir Singh, Village Sainimajra attached 4. Affidavit of Sh. Karamjit Singh S/o Gurnam Singh, Village Tejjamohri attached at 5. Affidavit of Sh. Sucha Singh S/o Prithvi, Village Dadlana attached 6. Details of above transaction are below. 1. The amount of Rs. 500000/- which are deposited in the bank on 18.04.2016 was withdrawn from same bank as under: Sr. No. Date Amount deposited In Bank Date of Source of cash Amount Source Document Attached 1. 18.04.2016 500000 04.04.2016 18.04.2016 400000 150000 Bank of Baroda Bank Statement 2. 17.05.2016 250000 17.05.2016 300000 Balbir Sing S/o Dhyan Singh Affidavit 3. 23.09.2016 350000 21.09.2016 19 09.2016 01.09.2016 22 08 2016 200000 75000 50000 100000 Bank of Baroda Bank Statement 4. 27.09 2016 400000 27.09 2016 150000 150000 150000 Ram Singh Balbir Singh S/o Balwant Singh Manoj Kumar S/o Jagir Singh Affidavit Affidavit 5. 06.10.2016 200000 06.10.2016 250000 Karamjeet Singh S/o Gurnam Singh Affidavit 6. 06.10.2016 200000 06.10.2016 250000 Suchal Lai S/o Prithvi Affidavit 7. 10.11.2016 200000 04.11.2016 250000 Bank of Baroda Bank Statement Total 2100000 ITA No.626/CHD/2023 A.Y. 2017-18 6 Date Amount Supported by 04.04.2016 400000 Bank Statement 18.04.2016 150000 Bank Statement 2. The amount of Rs.250000/- which was deposited in the bank on 17.05.2016has been received from Sh. Balbir Singh S/o Dhyan Singh Village Danhdehri dated 17.05.2016 amounting to Rs.300000/- (Affidavit enclosed at 2). 3. The amount of Rs.350000/- which was deposited in the bank on 23.09.2016 are withdraw from bank detailed as under: Date Amount Supported by 21.09.2016 200000 Bank Statement 19.09.2016 75000 Bank Statement 01.09.2016 50000 Bank Statement 22.08.2016 100000 Bank Statement Total 425000 4. The amount of Rs.400000/- which are deposited in the bank on 27.09.2016 are received from Date Amount Person Enclosure 27.09.2016 150000 Ram Singh S/o Sarup Singh, Village Ahuja Nil 27.09.2016 150000 Balbir Singh S/o Balwant Sing, Village Khaspura Enclosed at 3 27.09.2016 150000 Manoj Kumar S/o Jagir Singh, Village Sainimajra Enclosed 4 5. The amount of Rs.650000/- which are deposited in the bank on 06.10.2016 are received from Date Amount Person Enclosure 06.10.2016 250000 Karamjit Singh S/o Gurnam Singh, Village Teja Mohri Affidavit Enclosed at 5 06.10.2016 200000 Sucha Lai S/o Prithvi Lai Village Dadiyana Affidavit Enclosed a t 6 04.11.2016 250000 Karamjit Singh S/o Gurnam Singh Village Teja Mohri Bank of Baroda Bank Statement In view of the above, the assessee's has explained the cash deposited in the bank along with its source. ITA No.626/CHD/2023 A.Y. 2017-18 7 FACTS OF THE CASE: (a) Assessee is a commission agent who works as a middle man between farmers and purchaser (Government Agencies). Thus, grain sold to government agencies by the assessee belongs to farmers., The amount of sales proceeds received from government agencies in the bank account of assessee has been withdrawn in cash to make onward payment to farmers who, grain was sold by the assessee. Thus, cash has been withdrawn with a purpose of making onward payment to the farmers. During the year under consideration the assessee has sold agricultural produce worth Rs.1,46,21,944/- on which vat of Rs 699180 has been paid. A certificate from ' DFSC giving amount of purchases / market fees made by them from the assessee is enclosed as an evidence of total sales at enclosused at 7. (b) During the year under consideration the assessee has deposited Rs.2100000/- which has been duly explained with source of cash receipts. A photo copy of bank a/c is enclosed at 1 above (c) Assessee is a commission agent who sold goods on commission which belongs to the farmers. It is pertinent to mention here that goods sold are never owned by assessee. (d) Cash has been deposited in the bank out of the cash withdrawal from the same bank or recovered from the zimidars. As assessee has not other source of income other then commission income and he has not purchased / sold any goods. Addition made by Ld. AO is wrong, unjustified and against the facts of the case. Reconciliation of sales, VAT, Commission, TSD etc. Sales as per Sales Tax Register (GST) 1 st Quarter Date Sale VAT Purchaser Total Tax paid 01.04.2016 to 30.06.2016 1681319.20 84065.96 DFSC 1765385.16 000170 / 000251 SBI dated 12.05.16/10.06.16 1900213.00 95044.00 Society 1995224.00 41281439 / 27717617 SBI dated 17.05.16/21.06.16 189378.00 9470.00 Private Party. 198848.00 Challan dated 18.07.16 Total 3770910.20 188546.96 3959457.16 IInd Quarter ITA No.626/CHD/2023 A.Y. 2017-18 8 Date Sale VAT Purchaser Total Tax paid 01.07.2016 to 30.09.2016 699485.00 34974.00 Ambala Coop 734459.00 23179464 SBI Dated 20.10.16 Total 699485.00 34974.00 734459.00 III rd Quarter Date Sale VAT Purchaser Total Tax paid IVth Quarter Date Sale VAT Purchaser Total Tax paid 01.01.2017 to 31.03.2017 NIL NIL NIL NIL NIL Total sales as per VAT Tax Register & Records Grand total (I st Quarter to IV th Quarter) Grand Total 14B21944.00 699180.00 Copy of GST Returns are enclosed at 8 Sales to DFSC and others tally with commission earned/TDS deduction /Tax paid (A) Sales to DFSC (B) Sales to Society Sales to Private Party Quarter Sales Tax Sales Tax Sales Tax 1st Quarter 1681319.20 84065.96 1900213.00 95011.00 189378.00 9470.00 llnd Quarter 699485.00 34974.00 lllrd Quarter 9339986.00 466999.00 332377.00 479186.00 8660.00 0.00 IVth Quarter 0.00 0.00 Total 1681319.20 84065.96 11939684.00 596984.00 1000941.00 18130.00 A. Sales to DFSC 1681319.20 Tax 84065.96 B. Sales to Society 11939684.00 Tax 596984.00 C. Sales to Others 1000941.00 Tax 18130.00 Total (A+B) 14621944.20 Tax 699179.96 01.10.2016 to 31.12.2016 9339986 466999 Ambala Coop 9806985 27141798 dated 17.11.16 332377 8660.00 Private Party 341037 Challan Dated 17.01.17 479186 D-2 Private Party 479186.00 Total 10151549.00 475659.00 10627208 ITA No.626/CHD/2023 A.Y. 2017-18 9 Cross tally of sales with 26AS Form (Commission received from DFSC) enclosed at 9 Particulars Sales Commission TDS Labour TDS Total As per 26AS 14142080.00 353552.00 22861.00 17373.000 347.00 14536213.00 Others 85731.00 85731.00 14142080.00 353552.00 22861.00 103104.00 347.00 14621944.20 Thus sales, commission, TDS, Labour is reconciled with sales tax and market fees. Assessee has only commission income which is cross verified with GST Records, DFSC Records, 26AS and there is no other source of income. Addition made is wrong and against the facts of the case may kindly be deleted. Addition made under section 68, 69, 69A, 69B or 69D and its applicability to assessee's case – Section Applicability Applicability to assessee 68 Where any sum is found credited in books o1 assessee and the assessee offer no explanation about the nature and source thereof. No unexplained sum has been found or credited in books of assessee. 69 Assessee has made investment which are not recorded in books of account and assessee offers no explanation about the nature of source of investment No investment has been made by the assessee which is unexplainable. 69A If an assessee found to be the owner of any money or other valuable articles which is not recorded in books of accounts and the assessee offers no explanation about the nature and source of it. No money or other valuable article which is not recorded in books of accounts were found with the assessee. 69B Assessee has made investment or is owner of any valuable article and AO finds that amount expended on investment exceeds the amount recorded in books of accounts. Assessee has not made any unexplained investment. 69C Assessee has Incurred any expenditure and offers no explanation about the source of such expenditure Assessee has withdrawn the cash out of sale proceeds received from government agencies against the farmers grain sales by the assessee as commission agent. No unexplained expenditure has been incurred by the assessee. 69D Amount borrowed or repaid on hundi. No hundi borrowed or repaid. Assessee's case is not covered under any of above sections and addition made on account of above section is wrong, against the facts of the case deserve to be deleted. Assessee's Submissions: a) The assessee has made total sales amounting to Rs.14621^44/- which is duty tallied with the VAT returns filed for the relevant period where in VAT Tax has been deposited on total sales value as per VAT Return enclosed at 8. ITA No.626/CHD/2023 A.Y. 2017-18 10 (b) The assessee has sold grains belonging to farmers amounting to s. 146,2)844/- which is duly tallied with market fees paid as against sales. (c) Assesses has never purchased any goods of his own during the year under consideration as per profit and loss account filed with ITR and only commission has been earned. (d) Assessee has sold the agriculture produce of farmer as commission agent whose ownership lies with farmer as evidenced by Profit and loss account and Form 26AS enclosed at 9. (e) Assessee has received the payment from government agency (DFSC) by bank only which is received through Kacha Arhatia billing cum Payment Agents who were working a facilitator between assessee and government agency (DFSC). (f) Assessee has made the payment by withdrawing the amount from bank account to farmers of whose produce was sold to government agencies supported by 26AS and profit and loss account. (g) Assessee has earned commission amounting to Rs. 353552/- at the rate of 2.5% of the produce sold which is duly shown in the ITR filed by assessee and 26AS Form enclosed at 9. (h) Assessee's firm is engaged in a business of commission agents between farmer and government agencies and does not owned goods at any point of time. In fact, firm is a facilitator / middleman between farmer and government agencies while selling food grain produced an owned by farmers. During the assessment proceedings assessee has produced books of accounts, market committee records, sales bills etc. In view of the above assessment made by making the addition is wrong, without any valid basis and against the facts of the case. It is requested to kindly delete the addition also because assessee has not purchased any goods on his account and earned only commission." 5. By virtue of the impugned order, the ld. CIT(A) dismissed the appeal of the assessee, confirming the addition of Rs.21,00,000/- made by the AO. It was observed as follows : “6. I duly examined carefully the written submission of the appellant during the appellate proceedings. In his written submission the appellant has stated that he sold agricultural produce of farmers to Govt. Agencies and private parties and after collecting the payments from purchasers which are mainly Govt. Agencies make onward payments to farmers. Inspite of the fact commission is charged from purchaser. Assessee charge commission @2.5% from the purchaser. To earn the commission appellant facilitated the farmers by making advances to farmers for their agricultural and domestic requirements, by facilitating them to sell their produce at maximum rates and by making payment ITA No.626/CHD/2023 A.Y. 2017-18 11 to farmers after collecting it from the purchaser. All these submissions of the appellant are only written submission without any supporting documentary evidences. 6.1 The appellant has uploaded the detail explaining the source of cash in a tabulated form. As per information provided by the appellant Rs. 10,50,000/- was deposited out of cash withdrawal from bank and remaining Rs. 10,50,000/- was stated to be received from different individuals to deposit it in the bank account. The appellant has uploaded bank statement but did not provide cash book. In absence of cash book-it is not possible to verify the claim of the appellant that the amount of Rs. 10,50,000/- was deposited out of cash withdrawal made by the appellant himself. 6.2 Regarding, remaining Rs. 10,50,000/- which has been claimed by the appellant that the same was received from the following persons: S.No. Date Amount Date of Amount Source Document Attached deposited Source of in Bank cash 6.3 In support of his claim, the appellant "has furnished affidavits from these individuals which prima facie seems to be self-produced. The appellant has neither provided the PAN of the concerned person nor their complete address. Thus, the identity of these persons, genuineness of the respective transactions and creditworthiness of these persons have been proved. Therefore, I am of considered opinion that the appellant has failed To substantiate an explain the cash of Rs. 21,00,000/- deposited in his account. Accordingly, the appeal of the appellant on this issue is dismissed and not allowed.” 6. So, the ld. CIT(A) confirmed the addition by holding that the 1. 17.05.2016 250000 17.05.2016 300000 Balbir Sing S/o Dhyan Singh Affidavit 2. 27.09.2016 400000 27.09.2016 150000 150000 150000 Ram Singh Balbir Singh S/o Balwant Singh Manoj Kumar S/o Jagir Singh Affidavit Affidavit 3. 06.10.2016 200000 06.10.2016 250000 Karamjeet Singh S/o Gum am Singh Affidavit 4. 06.10.2016 200000 06.10.2016 250000 Suchal Lai S/o Prithvi Affidavit Total 10,50,000 ITA No.626/CHD/2023 A.Y. 2017-18 12 assessee could not file any supporting documentary evidence to explain the source of the cash deposits; and that the affidavits furnished were merely self-serving, without the PAN or the complete address of the concerned persons/farmers. 7. The ld. Counsel for the assessee has contended that the ld. CIT(A) has erred in law and on facts in confirming the action of the AO of treating the cash of Rs. 21,00,000/- deposited as unexplained income under Section 69A r.w. Section 115BBE of the Act; and that the ld. CIT(A) has erred in law and on facts in confirming the action of the AO of treating the cash sales deposit of Rs. 21,00,000/- as unexplained income under Section 69A ignoring the fact that deposited cash is duly recorded in the Cash Book. 8. The ld. DR, on the other hand, has placed strong reliance on the impugned order. It has been contended that as correctly observed by the ld. CIT(A), though the assessee had stated that he sold agricultural produce of farmers to Government Agencies and private parties after collecting the payment from the purchasers and made onward payment to the farmers, no evidence in this regard was filed at any stage and, therefore, this claim of the assessee remained unsupported; that as per the assessee, an amount of Rs.10,50,000/- was deposited out of cash ITA No.626/CHD/2023 A.Y. 2017-18 13 withdrawal from bank and an amount of Rs.10,50,000/- was received from different individuals, that though the assessee had uploaded bank statements, he had not provided cash book; it was therefore, that the claim, as correctly observed by the ld. CIT(A), was incapable of being verified and the assessee remained unable to prove that the amount of Rs.10,50,000/-, the assessee had furnished affidavits from the individuals; that since the assessee did not provide either the PAN or the complete address of the concerned person, the ld. CIT(A) has correctly held that neither the identity of these persons, nor the genuineness of the transactions, nor even the credit worthiness of the persons stood proved; and that in this view of the matter, the ld. CIT(A) can not be said to have erred in confirming the addition made by the AO. It has been submitted that therefore, there being no merit therein, the appeal filed by the assessee be dismissed while confirming the well versed order of the ld. CIT(A). 9. Heard. The assessee has maintained, as before the ld. CIT(A), that the assessee had made total sales of Rs.1,46,21,944/-, which stood duly tallied with the VAT Returns filed for the relevant period, wherein, Value Added Tax had been deposited on the total sales value as per the VAT Return; that the assessee had sold grains of the farmers, amounting to ITA No.626/CHD/2023 A.Y. 2017-18 14 Rs.1,46,21,944/-, which stood duly tallied with the market fees paid as against sales; that during the year, the assessee did not purchase any goods of his own, as per the Profit & Loss Account filed alongwith the ITR and only commission had been earned; that the assessee had sold the agricultural produce of farmers, as a commission agent; that the ownership of such agricultural produce was that of the farmers, as available from the Profit & Loss Account and Form 26AS; that the assessee had received payment from DFSC, i.e., the Government Agency, through bank only; that such payment was received through Katcha Arhatia billing-cum-payment agencies who were working as facilitators between the assessee and the Government Agency, i.e., DFSC; that the assessee had withdrawn money from the bank account and made the payment to the farmers whose agricultural produce was sold to the Government Agencies; that this position stands supported by the Form 26AS and the Profit & Loss Account; that the assessee had earned commission amounting to Rs.3,53,552/- , @ 2.5% of the produce sold; that this stands shown in the assessee's ITR and Form 26AS; that the assessee's firm is engaged in the business of commission agents between the farmers and the Government Agencies and it does not own the goods at any point of time; that in fact, the firm is a ITA No.626/CHD/2023 A.Y. 2017-18 15 facilitator/middleman between the farmers and the Government Agencies, while selling the agricultural produce of the farmers; and that in the assessment proceedings, the assessee had produced the books of account, the Market Committee records, sale bills, etc. 9.1 It has not been disputed by the taxing authorities that the cash deposit was out of available cash as per the Cash Book and the Bank Statement. The assessee, we find is correct in contending that the ld. CIT(A)’s observation that the assessee did not furnish any reply/response before the AO even after a lapse of more than six months, is an incorrect finding. The assessee had furnished written submissions (APB-6) dated 07.09.2019, copy of Cash Book (APB 7-11) and Bank Account Statement (APB 12-28) before the AO, which has not been disputed. A Show Cause Notice dated 13.11.2019 had been issued by the AO fixing the case for 16.11.2019, i.e., giving time of only two days. The assessment had been completed on 20.11.2019. The year under consideration, i.e., assessment year 2017-18 was the first year of e-assessment. It has not been disputed that no Show Cause Notice was served on the assessee. 9.2 The ld. CIT(A) is again wrong in observing that the assessee did not furnish the complete addresses of the ITA No.626/CHD/2023 A.Y. 2017-18 16 farmers/concerned persons. These persons are villagers and their addresses were of their villages. These addresses are contained in the affidavits (APB 37-41) filed by the assessee. The ld. CIT(A), without any basis, held that these affidavits “prima facie seem to be self produced”. While holding so, the ld. CIT(A) wrongly did not deem it appropriate to verify the contents of these affidavits. In these affidavits, the deponents have, in no un-certain terms, deposed that during the concerned period, they were owners of agricultural land. They have also given the area of land cultivated by them. They have stated that during the concerned period, they had sold agricultural produce to M/s Hakim Ram Siri Ram, the proprietory firm of the assessee. They have stated that they maintained a running account with the firm. They have deposed that they had deposited cash with the firm, which they have again confirmed without even making an attempt to verify these assertions of the farmers, the ld. CIT(A) merely held the affidavits to be self-produced. Now, in the absence of anything having been brought on record by the ld. CIT(A) to refute or rebut the contents of these affidavits, it is well settled that such contents of the affidavits have to be accepted as true. 9.3 The cash deposits in Bank of Baroda, Ambala City, have ITA No.626/CHD/2023 A.Y. 2017-18 17 been tabulated as under, and the same does not stand refuted ; 9.4 Concerning the deposits out of withdrawals, it is seen that there is no adverse finding in this regard. The cash book was produced before the AO itself. The amount was withdrawn from the same bank. There is, thus, no justification in disregarding these bank withdrawals, which explains the deposit of the amount of Rs.10,50,000/-. 10. In view of the above, the grievance of the assessee is found SN Date of Deposit of Cash in Bank Amount Explanation A 18-4-2016 5,00,000 Amount was deposited out of cash withdrawn from same Bank on 4-4-16 Rs. 4,00,000/- and Rs. 1,50,000/- on 18- 4-16. Cash Book at PBPage 3, Bank Statement at page 12. B 17-5-2016 2,50,000 Amount was deposited out of cash received from Balbir Singh son of Dhyan Singh resident of village Dudiana Ambala. An opening debit balance of Rs. 3,15,000/- from the customer and closing balance of Debit Rs. 1,30,000/- from customer. Cash Book at PBPage 8, Bank Statement at page 14 and Affidavit of Balbir Singh at page 37. c. 23-9-2016 3,50,000 Amount was deposited out of cash withdrawn from same Bank on 21- 9-16 Rs. 2,00,000/-, 19-9-16 Rs. 75,000/- and Rs. 50,000/- on 1-9-16. Cash Book at PB Page 9, Bank Statement at page 17. D 27-9-2016 4,00,000 Amount was deposited out of cash received from Ram Singh on 27-9- 2016 Rs. 1,50,000/- Rs. 1,50,000/- from Balbir Singh Son of Balwant Singh (Affidavit at page 38) Rs. 1,50,000/- from Manoj Kumar son of Jagir Singh (Affidavit at page39), copy of CB at page 9. Bank Statement at page 17. E 6-10-2016 2,00,000 Amount was deposited out of cash received from Karamjit Singh son of Gurnam Singh .resident of village Mohri Ambala on 6-10-2016 (Affidavit at page 40), copy of CB at page 10. Bank Statement at page 17. F 6-10-2016 2,00,000 Amount was deposited out of cash received from Sucha Singh son of Prithvi Lal resident village Dudiana Ambala on 06.10.2016 (affidavit at page 41), copy of CB at page 10. Bank Statement at page 17. G 10.11.2016 2,00,000 Amount was deposited out of cash withdrawn from same Bank on 4.11.2016 Rs. 2,50,000/-, Cash Book at PB Page 11, Bank Statement at page 20. ITA No.626/CHD/2023 A.Y. 2017-18 18 to be justified and it is accepted as such. The order passed by the ld. CIT(A) is found to be erroneous and it is, accordingly, ordered to be reversed. The addition made is ordered to be deleted. 11. In the result, the appeal is allowed. Order pronounced on 14.08.2024. Sd/- Sd/- (KRINWANT SAHAY) (A.D.JAIN ) ACCOUNTANT MEMBER VICE PRESIDENT “Poonam” आदेश क त(ल)प अ*े)षत/ Copy of the order forwarded to : 1. अपीलाथ / The Appellant 2. यथ / The Respondent 3. आयकरआय ु +त/ CIT 4. )वभागीय त न.ध, आयकर अपील"य आ.धकरण, च0डीगढ़/ DR, ITAT, CHANDIGARH 5. गाड फाईल/ Guard File आदेशान ु सार/ By order, सहायक पंजीकार/ Assistant Registrar