Sh. Ravinder Singh Nagi, Mohali V. DCIT, Mohali

ITA 811/CHANDI/2014

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 8993 (ITAT-CHANDIGARH)
• Duration Of Justice: 2 year(s) 1 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-11-2016
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: B
• Next Hearing Date: 05-09-2016
• Assessment Year: 2009-2010
• Appeal Filed On: 25-09-2014
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: RAVI SARANGA L
• Keywords: Business income; Peak credit
• Section: 11

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DIVISION BENCH,CHANDIGARH BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER AND MS.ANNAPURNA GUPTA, ACCOUNTANT MEMBER ITA NOS. 811 & 812/CHD/2014 A.Y: 2009-10 & 2010-11 SHRI RAVINDER SINGH NEGI, VS THE DCIT, PLOT NO. 797, CIRCLE 6(1), JANTA LAND & PROMOTERS LTD., MOHALI. SECTOR 90-91, GREATER MOHALI. PAN: AAGPN3602B (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI T.N.SINGLA RESPONDENT BY : SHRI RAVI SARANGAL DATE OF HEARING : 25.10.2016 DATE OF PRONOUNCEMENT : 08.11.2016 O R D E R PER BHAVNESH SAINI,JM BOTH THE APPEALS BY THE SAME ASSESSEE ARE DIRECTED AGAINST DIFFERENT ORDERS OF LD. CIT(APPEALS) CHANDI GARH DATED 19.08.2014 FOR ASSESSMENT YEARS 2009-10 AND 2010-11. 2. WE HAVE HEARD LD. REPRESENTATIVES OF BOTH THE PARTIES AND PERUSED THE MATERIAL ON RECORD. THE ISS UES ARE SAME IN BOTH THE APPEALS. GROUND NOS. 1 AND 4 IN BOTH THE APPEALS ARE GENERAL AND NEED NO ADJUDICATI ON. 2 MAINLY TWO ISSUES HAVE BEEN RAISED IN BOTH THE APPE ALS ON IDENTICAL FACTS, THEREFORE, SAME ARE DECIDED AS UNDER. ISSUE NO. 1 3. ON GROUND NO. 2 IN BOTH THE APPEALS, THE ASSESSE E CHALLENGED THE ORDER OF LD. CIT(APPEALS) IN UPHOLDI NG THE ADDITION OF RS. 27,06,166/- AND RS. 30,50,830/- MAD E BY THE ASSESSING OFFICER IN BOTH THE ASSESSMENT YEA RS RESPECTIVELY BY APPLYING NET PROFIT RATE OF 12% INS TEAD OF 8% ON THE GROSS RECEIPTS AS DECLARED BY THE ASSESSE E. BRIEF FACTS OF THE CASE ARE THAT ASSESSEE IS PROPRI ETOR OF M/S R.D. CONSTRUCTION CO. ENGAGED IN ERECTION AND INSTALLATION. THE STATEMENT OF THE ASSESSEE WAS RECORDED AT ASSESSMENT STAGE IN WHICH THE ASSESSEE ADMITTED THAT HE IS PROPRIETOR OF M/S R.D. CONSTRUC TION CO. AND SAID FIRM WAS ENGAGED IN BUSINESS OF ERECTI ON, FABRICATION AND INSTALLATION OF PLANT, MACHINERY, STRUCTURE AND CIVIL WORKS. THE ASSESSEE HAD NOT MAINTAINED ANY BOOKS OF ACCOUNT FOR THIS BUSINESS A ND HAS NO DETAILS OF PARTIES FROM WHOM HE HAD MADE PURCHASES. NO RECEIPTS ARE AVAILABLE. THE PROFIT RATE HAVE BEEN SHOWN BY APPLYING 7% OF THE GROSS RECEIPT S FROM THE BUSINESS. THE ASSESSEE DID NOT MAINTAIN A NY BILLS, VOUCHERS, LEDGER, WAGES REGISTER ETC. THE ASSESSING OFFICER ASKED THE ASSESSEE TO EXPLAIN THE BASIS OF ADOPTING AVERAGE PROFIT OF 8%. THE ASSESS ING OFFICER, ON CONSIDERING EXPLANATION OF THE ASSESSEE FOUND THAT EXPLANATION OF THE ASSESSEE IS NOT CONVI NCING 3 AND THAT ASSESSING OFFICER APPLIED NET PROFIT RATE OF 12% IN VIEW OF THE JUDGEMENT OF HON'BLE PUNJAB & HARYAN A HIGH COURT IN THE CASE OF PRABHAT KUMAR 323 ITR 675 AND MADE BOTH THE ABOVE ADDITIONS. 4. THE ASSESSEE CHALLENGED THE APPLICATION OF PROFI T RATE OF 12% BY CITING DIFFERENT DECISIONS. THE LD. CIT(APPEALS), HOWEVER CONSIDERED THE ISSUE IN DETAI L AND NOTED THAT SINCE ASSESSEE DID NOT MAINTAIN ANY RECO RD AND NO BOOKS OF ACCOUNT HAVE BEEN MAINTAINED, THEREFORE, NO INTERFERENCE IS CALLED FOR AND ACCORD INGLY DISMISSED THESE GROUNDS OF APPEAL OF THE ASSESSEE FOLLOWING THE DECISION OF HON'BLE PUNJAB & HARYANA HIGH COURT IN THE CASE OF PRABHAT KUMAR (SUPRA). THESE GROUNDS WERE ACCORDINGLY DISMISSED. 5. THE LD. COUNSEL FOR THE ASSESSEE FAIRLY ADMITTED THAT IN PRECEDING ASSESSMENT YEARS 2007-08 AND 2008 - 09, THE ASSESSEE PREFERRED APPEALS BEFORE ITAT CHANDIGARH BENCH IN ITA NOS. 558 & 559/2014 ON THE IDENTICAL ISSUE IN WHICH ALSO NET PROFIT RATE OF 12 % WAS APPLIED BY THE ASSESSING OFFICER ON IDENTICAL FACTS AND THE TRIBUNAL VIDE ORDER DATED 17.09.2015 DISMISSED BOTH THE APPEALS OF THE ASSESSEE FINDING THAT NET P ROFIT OF 12% ON GROSS RECEIPTS IS REASONABLE BY FOLLOWING DECISION OF THE HON'BLE PUNJAB & HARYANA HIGH COURT IN THE CASE OF PRABHAT KUMAR. THE LD. COUNSEL FOR THE ASSESSEE, THEREFORE, SUBMITTED THAT ISSUE IS COVERE D AGAINST ASSESSEE BY ORDER OF ITAT CHANDIGARH BENCH 4 DATED 17.09.2015 (SUPRA). COPY OF THE ORDER IS PLA CED ON RECORD. 6. AFTER CONSIDERING THE ABOVE FACTS, WE ARE OF THE VIEW THAT ON IDENTICAL FACTS THE TRIBUNAL HAS ALREA DY DECIDED THE SIMILAR ISSUE AGAINST THE ASSESSEE VIDE ORDER DATED 17.09.2015 AND CONFIRMED THE APPLICATION OF N ET PROFIT RATE OF 12% FOR THE PURPOSE OF ESTIMATING BU SINESS INCOME OF THE ASSESSEE. IT IS ADMITTED FACT THAT ASSESSEE DID NOT MAINTAIN ANY BOOKS OF ACCOUNT AND ANY DETAIL TO SHOW AS TO HOW THE BUSINESS INCOME HAVE B EEN COMPUTED. THE ISSUE IS, THEREFORE, COVERED AGAINST THE ASSESSEE ON IDENTICAL FACTS BY ORDER OF ITAT CHANDI GARH BENCH IN THE CASE OF THE SAME ASSESSEE DATED 17.09.2015. WE, THEREFORE, DO NOT FIND ANY MERIT I N THESE GROUNDS OF APPEAL OF THE ASSESSEE IN BOTH THE APPEALS. THESE GROUNDS ARE, THEREFORE, DISMISSED. ISSUE NO. 2 7. IN BOTH THE APPEALS, ASSESSEE CHALLENGED THE ORD ER OF LD. CIT(APPEALS) IN UPHOLDING THE ADDITION MADE BY ASSESSING OFFICER OF CASH DEPOSITS OF RS. 3.13 CR A ND RS. 2,03,99,700/- IN BOTH THE ASSESSMENT YEARS RESPECTI VELY IN BANK ACCOUNT OF THE ASSESSEE. 8. IN ASSESSMENT YEAR 2009-10, THE ASSESSING OFFICE R DID NOT ACCEPT EXPLANATION OF THE ASSESSEE THAT CAS H DEPOSITED DURING THE YEAR WAS RE-DEPOSIT OF AMOUNTS 5 WITHDRAWN IN EARLIER YEARS AND GIVEN AS BAYANAS IN THE DEALS WHICH DID NOT MATURE. THE ASSESSING OFFICER NOTED THAT CASH DEPOSITS TO THE TUNE OF RS. 3.13 CR IN VARIOUS BANKS ACCOUNTS MAINTAINED BY THE ASSESSEE. WHEN QUESTIONED ABOUT SOURCE OF DEPOSITS, ASSESSEE HAD SUBMITTED THAT THESE AMOUNTS WEE GIVEN AS BAYANAS F OR PURCHASE OF IMMOVABLE PROPERTIES IN FINANCIAL YEAR 2006-07, BUT FOR THE SOME REASONS, THE DEALS DID NO T MATERIALIZE AND THE BAYANAS WERE RECEIVED BACK WHIC H HAD BEEN DEPOSITED BY ASSESSEE IN HIS BANK ACCOUNTS . THE ASSESSING OFFICER ASKED THE ASSESSEE TO PRODUCE EVIDENCE REGARDING BAYANAS GIVEN EARLIER BUT ASSESS EE DID NOT PRODUCE ANY EVIDENCE AND SO THE ASSESSING OFFICER TREATED THE ENTIRE AMOUNT AS UNEXPLAINED CA SH DEPOSIT. THE ASSESSING OFFICER HAS NOT GIVEN BENEF IT OF CASH WITHDRAWALS AMOUNTING TO RS. 7.65 CR ON THE GROUND THAT THE ASSESSEE HAD NOT MAINTAINED HIS BOO KS OF ACCOUNT AND HAD NOT GIVEN ANY EVIDENCE OF EXPENS ES INCURRED, WHICH WERE LARGELY IN CASH. 9. THE ADDITION WAS CHALLENGED BEFORE LD. CIT(APPEALS) AND WRITTEN SUBMISSION OF THE ASSESSEE IS REPRODUCED IN THE IMPUGNED ORDER IN WHICH THE ASSES SEE BRIEFLY EXPLAINED THAT ASSESSING OFFICER IN PARA 20 OF THE ASSESSMENT ORDER HAS ADMITTED THAT CASH DEPOSITS WE RE RS. 4,30,58,100/- AGAINST CASH WITHDRAWALS OF RS. 7,65,40,797/- DURING THE YEAR UNDER CONSIDERATION. THE ASSESSEE HAS PREPARED CASH-FLOW STATEMENT FROM ALL THE 6 BANK ACCOUNTS OF THE ASSESSEE DURING THE YEAR AND A S PER CASH-FLOW STATEMENT FILED, THERE IS SUFFICIENT CASH IN HAND AVAILABLE ON EACH DAY DURING THE FINANCIAL YEA R. THIS CASH-FLOW STATEMENT IS PREPARED BY THE ASSESSE E FROM CASH DEPOSIT AND CASH WITHDRAWALS IN THE BANKS DURING THE YEAR. FURTHER, ASSESSEE HAD GIVEN SOME BAYANAS FOR LAND IN EARLIER YEAR WHICH WERE RECEIVE D DURING THE YEAR WHICH WAS ALSO AVAILABLE TO THE ASSESSEE, THEREFORE, THE BENEFIT OF WHICH SHOULD HA VE BEEN ALLOWED BY THE ASSESSING OFFICER. IT WAS FURT HER SUBMITTED THAT ASSESSING OFFICER MADE ADDITION OF R S. 27,06,166/- OF LESSER GP, SUCH BENEFIT SHOULD ALSO BE ALLOWED TO THE ASSESSEE. 10. THE LD. CIT(APPEALS), CONSIDERING EXPLANATION O F THE ASSESSEE REJECTED THE CONTENTION OF THE ASSESSE E AND DISMISSED APPEAL. 10(I) THE LD. COUNSEL FOR THE ASSESSEE REITERATED THE SUBMISSIONS MADE BEFORE AUTHORITIES BELOW AND SUBMITTED THAT CASH WITHDRAWALS ARE MORE THAN THE C ASH REDEPOSITS IN THE BANK ACCOUNTS. CASH-FLOW STATEME NT HAVE NOT BEEN DOUBTED BY THE AUTHORITIES BELOW. NO NEGATIVE CASH WAS FOUND IN CASH-FLOW STATEMENT OR I N THE BANK ACCOUNTS. NO INVESTMENTS WERE FOUND OUT O F CASH WITHDRAWALS. SINCE ASSESSEE DID NOT MAINTAIN BOOKS OF ACCOUNT THEREFORE, CASH-FLOW STATEMENT WAS RELEVANT. THE TOTAL RECEIPTS OF THE ASSESSEE FROM THE MAIN BUSINESS WERE IN A SUM OF RS. 6.78 CR WHICH HA VE 7 NOT BEEN DOUBTED WHICH IS ALSO SUFFICIENT TO MEET O UT THE RE-DEPOSITS OF CASH IN THE BANK ACCOUNTS. THE ASSESSING OFFICER NOTED TOTAL CASH DEPOSITS IN VARI OUS YEARS IN THE BANK ACCOUNTS IN A SUM OF RS. 6.60 CR BUT ADDITION IS MADE ON SMALL AMOUNT, MEANING THEREBY, EXPLANATION OF THE ASSESSEE OF RE-DEPOSIT HAVE BEEN ACCEPTED. THE ASSESSING OFFICER HIMSELF ASKED THE ASSESSEE TO FILE CASH-FLOW STATEMENT IN ORDER TO CL ARIFY THE ISSUE, THEREFORE, WHOLE ADDITION IS UNJUSTIFIED . HE HAS RELIED UPON FOLLOWING ORDERS/DECISIONS : I) ORDER OF ITAT CHANDIGARH BENCH IN THE CASE OF ANKUR NOHRIA VS ITO ITA 219/2014 DATED 10.02.2015. II) ORDER OF ITAT CHANDIGARH BENCH IN THE CASE OF ITO V ASHOK KUMAR JAIN, ITA 180/2013 DATED 03.11.2015. III) ORDER OF ITAT CHANDIGARH BENCH IN THE CASE OF ACIT VS JOGINDER PAL, ITA NO. 734/2015 DATED 12.01.2015. IV) DECISION OF HON'BLE PUNJAB & HARYANA HIGH COURT IN THE CASE OF CIT VS SURINDER PAL ANAND 192 TAXMAN 264. 10(I) ON THE OTHER HAND, LD. DR RELIED UPON ORDER S OF AUTHORITIES BELOW AND SUBMITTED THAT ASSESSEE FAILE D TO EXPLAIN CASH DEPOSIT IN THE BANK ACCOUNTS, THEREFOR E, ADDITION MAY BE CONFIRMED. 11. WE HAVE CONSIDERED RIVAL SUBMISSIONS. IT IS NO T IN DISPUTE THAT ASSESSEE IS ENGAGED IN THE BUSINESS OF FABRICATION AND ERECTION OF STEEL STRUCTURES FOR VA RIOUS PRIVATE PARTIES. THE ASSESSEE DID NOT MAINTAIN BOO KS OF 8 ACCOUNT AND NO AUDIT REPORT OR BILLS AND VOUCHERS H AVE BEEN PRODUCED BEFORE AUTHORITIES BELOW THEREFORE, P ROFIT WAS ESTIMATED BY APPLYING HIGHER PROFIT RATE. THE ASSESSEE ALSO EXPLAINED THAT ALL THE DETAILS OF REC EIPTS ARE MENTIONED IN FORM NO. 26AS AND TOTAL RECEIPTS O F THE ASSESSEE WERE FOUND IN A SUM OF RS. 6.78 CR WHI CH HAVE BEEN RECEIVED THROUGH BANKING CHANNEL AND ENTERED INTO THE BANK ACCOUNTS OF THE ASSESSEE. ULTIMATELY, PROFIT RATE WAS ENHANCED AND PROFIT HAV E BEEN COMPUTED ACCORDINGLY ON WHICH WE HAVE ALSO CONFIRMED THE ORDERS OF AUTHORITIES BELOW. THE ASSESSING OFFICER FOUND ASSESSEE MADE CASH DEPOSITS TO THE TUNE OF RS. 6.60 CR IN VARIOUS BANK ACCOUNTS DU RING THREE FINANCIAL YEARS 2006-07 TO 2008-09. THE ASSE SSEE EXPLAINED THAT THESE DEPOSITS ARE FROM WITHDRAWALS MADE FROM VARIOUS BANK ACCOUNTS AS WELL AS ON ACCOU NT OF RETURN OF BAYANAS. THE ASSESSEE WAS, THEREFORE, ASKED TO PRODUCE CASH-FLOW STATEMENT WHICH WAS SUBMITTED BY ASSESSEE BEFORE ASSESSING OFFICER. 11(I) THE ASSESSING OFFICER ON PERUSAL OF THE CASH- FLOW STATEMENT FOUND THAT ASSESSEE HAD MADE CASH DEPOSITS TO THE TUNE OF RS. 4,30,58,100/- AND CASH WITHDRAWALS AMOUNTING TO RS. 7,65,40,797/- DURING T HE PERIOD UNDER CONSIDERATION. TOTAL RECEIPTS OF THE ASSESSEE FROM BUSINESS IN A SUM OF RS. 6.78 CR ARE SUFFICIENT TO MEET OUT THE RE-DEPOSIT OF THE CASH I N BANK ACCOUNT OF THE ASSESSEE. THE ASSESSING OFFICER HIM SELF ASKED THE ASSESSEE TO PREPARE CASH-FLOW STATEMENT 9 WHICH IS FILED BEFORE AUTHORITIES BELOW, COPIES OF SAME ARE ALSO FILED BEFORE US SUPPORTED BY VARIOUS BANK STATEMENTS UNDER CONSIDERATION. THE A.O. AND CIT(A ) DID NOT DOUBT THE CASH-FLOW STATEMENT SUPPORTED BY BANK STATEMENTS. IT WOULD, THEREFORE, PROVE THAT ASSESSEE HAS MADE CASH WITHDRAWALS DURING THE YEAR IN A SUM OF RS. 7.65 CR AND MADE RE-DEPOSIT OF RS. 4.3 0 CR. NO NEGATIVE CASH WAS FOUND ON ANY DAY AS PER C ASH- FLOW STATEMENT. NO DISCREPANCY IN THE CASH-FLOW STATEMENT, PREPARED ON THE BASIS OF BANK ACCOUNTS O F THE ASSESSEE, WAS FOUND. SINCE NO BOOKS OF ACCOUNT HAVE BEEN MAINTAINED BY ASSESSEE, THEREFORE, CASH-F LOW STATEMENT WAS VITAL AND IMPORTANT EVIDENCE TO SUPPO RT CONTENTION OF THE ASSESSEE TO EXPLAIN RE-DEPOSIT OF CASH IN THE BANK ACCOUNTS OUT OF CASH WITHDRAWALS. THE AUTHORITIES BELOW HAVE ADMITTED EXCESS CASH AVAILAB LE TO THE ASSESSEE AGAINST THE DEPOSITS MADE BY ASSESSEE. CASH FLOW STATEMENT SHOULD NOT BE DISBELIEVED BY AUTHORITIES BELOW. IT IS ACCEPTED. 11(II) THE AUTHORITIES BELOW HAVE NOT TAKEN ALL THE CASH DEPOSIT IN VARIOUS BANK ACCOUNTS ADVERSE IN NATURE AGAINST THE ASSESSEE BECAUSE LESSER ADDITION HAVE B EEN MADE BY THE AUTHORITIES BELOW. THE AUTHORITIES BEL OW MERELY REJECTED THE CONTENTION OF THE ASSESSEE BECA USE OF WEAKNESS OF THE ASSESSEE IN EXPLAINING BAYANAS RETURNED TO THE ASSESSEE AS WELL AS NO BOOKS OF ACC OUNT 10 HAVE BEEN MAINTAINED BY THE ASSESSEE. THIS FACT IS WITHIN THE KNOWLEDGE OF THE REVENUE AUTHORITIES THA T ASSESSEE DID NOT MAINTAIN ANY BOOKS OF ACCOUNT NOT ONLY IN THE YEAR UNDER APPEAL BUT IN PRECEDING ASSESSMEN T YEARS AS WELL. THEREFORE, SUCH REASON WOULD NOT BE RELEVANT TO TAKE ANY ADVERSE INFERENCE AGAINST THE ASSESSEE. 12. THE HON'BLE PUNJAB & HARYANA HIGH COURT IN THE CASE OF SHIV CHARAN DASS VS CIT 126 ITR 263 CONSIDE RED THE FACTS WHEREIN THE AMOUNTS KEPT WITH THE WIFE OF THE ASSESSEE FROM 1951 UPTO HER DEATH IN 1956 LATER DEPOSITED IN BANK IN THE NAMES OF TWO UNMARRIED DAUGHTERS OF THE ASSESSEE AFTER THEY BECAME MAJOR EXPLANATION OF THE ASSESSEE WAS NOT ACCEPTED AND AMOUNT DEPOSITS WERE CONSIDERED FROM UNDISCLOSED SOURCES. HON'BLE HIGH COURT HELD THAT, THERE WAS NOTHING ON RECORD TO SHOW THAT AMOUNT WAS UTILIZED BY THE ASSESSEE OR THE HUF IN ANY OTHER MANNER THAN TH E ONE WHICH WAS REPRESENTED BY THE ASSESSEE, THE ONUS LAY ON THE DEPARTMENT TO SHOW THAT EXPLANATION OFFERED BY THE ASSESSEE SHOULD NOT BE ACCEPTED. 12(I) THE ITAT CHANDIGARH BENCH IN THE CASE OF ANKU R NOHRIA VS ITO (SUPRA) HELD IN PARA 8 AS UNDER : 8. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. IT IS N OT IN DISPUTE THAT THE TOTAL SALES OF THE ASSESSEE WERE O F RS.39,00,875/-. THE ASSESSEE IS THE TRADER OF BALL B EARINGS AND MACHINERY PARTS AND EXPLAINED BEFORE THE ASSESSING OF FICER THAT THE RETURN OF INCOME WAS FILED UNDER SPECIAL PROVIS IONS CONTAINED 11 UNDER SECTION 44AF OF THE ACT. THEREFORE, THE ASSES SEE IS NOT REQUIRED TO MAINTAIN THE BOOKS OF ACCOUNT. EVEN THEN ACCORDING TO THE SUBMISSION OF THE ASSESSEE, THE ASSESSEE MAINT AINED ONLY CASH BOOK AND LEDGER. THE PRINTOUT OF COMPUTERIZED C ASH BOOK AND LEDGER WERE ALSO PRODUCED BEFORE THE ASSESSING OFFICER. IT .WAS ALSO EXPLAINED THAT THE BANK ACCOUNT OF KOTAK M AHINDRA BANK, RAJPURA HAS BEEN SHOWN IN THE BOOKS OF ACCOUNT BUT DUE TO MISTAKE THE BALANCE WAS TRANSFERRED TO EXPENSES A CCOUNT INSTEAD OF THE BALANCE BEING TAKEN TO BALANCE SHEET. THE ASSESSING OFFICER ALSO NOTED THE FACT THAT THE AMOU NT DEPOSITED IN CASH IN THIS BANK ACCOUNT HAS SMALL DEPOSITS AS WEL L AS WITHDRAWAL OF THE CASH IMMEDIATELY EITHER ON THE SAM E DAY OR THE NEXT DAY OF THE DEPOSITS. THE ASSESSING OFFICER ALSO NOTED THAT ALL THE ENTRIES APPEARING IN THE BANK STATEMENT HAVE BEEN PUT BY THE ASSESSEE IN CASH BOOK ALSO, THOUGH THE A SSESSING OFFICER DISBELIEVED THE ENTRIES CONTAINED IN THE CAS H BOOK AND CONSIDERED IT TO BE AN AFTER THOUGHT. IN THIS BACKGROU ND, IT IS CLEAR THAT THE ASSESSEE IS A RETAILER AND FILED RETU RN OF INCOME WITH THE AID OF SECTION 44 AF OF THE ACT. THEREFORE, THE ASSESSEE NEED NOT TO MAINTAIN ANY REGULAR BOOKS OF ACCOUNT. IT IS A FACT THAT IN THE ASSESSMENT YEAR UNDER APPEAL THE ASSESSE E MADE VARIOUS CASH DEPOSITS IN THE BANK ACCOUNT MAINTAINED W ITH KOTAK MAHINDRA BANK, RAJPURA BUT THE DETAILS OF THE S AME SHOWS THAT THESE WERE SMALL DEPOSITS IN THIS BANK AC COUNT. SAME AMOUNT AS DEPOSITED IN CASH IN THIS BANK ACCOUNT H AS BEEN WITHDRAWN IMMEDIATELY EITHER ON THE SAME DAY OR THE NEXT DAY. THE ASSESSEE HAS FAILED TO RECONCILE WHETHER T HE SAME DEPOSITS WERE FROM THE SALE PROCEEDS OF THE ASSESSEE . IT IS ALSO FACT THAT INITIALLY THE ASSESSEE DID NOT DISCLOSE TH E BANK ACCOUNT MAINTAINED WITH KOTAK MAHINDRA BANK, RAJPURA TO THE RE VENUE AUTHORITIES AND THE ASSESSING OFFICER ALSO CALLED FO R THE INFORMATION FROM THE CONCERNED BANK AS WELL AS INFORMA TION WAS RECEIVED FROM AIR THAT THERE ARE CASH DEPOSITS IN THE BANK ACCOUNT OF THE ASSESSEE WITH KOTAK MAHINDRA BANK, R AJPURA. THEREFORE, THE DECISION OF THE HON'BLE PUNJAB & HARY ANA HIGH COURT IN THE CASE SURINDER PAL ANAND (SUPRA) WOULD N OT SUPPORT THE CASE OF THE ASSESSEE BECAUSE THE ASSESSEE HAS N OT PROVED 12 NEXUS OF THE CASH DEPOSITED IN THE BANK WITH THE GROS S DEPOSITS. HOWEVER, CONSIDERING THE FACT THAT THE ASSESSEE MADE SMALL DEPOSITS IN THE BANK ACCOUNT WITH KOTAK MAHINDRA BANK, RAJPURA ON VARIOUS DATED AND AFTER DEPOSITING THE CASH TO THIS ACCOUNT, THE ASSESSEE ALSO WITHDRAWN THE SAME AMOUN T EITHER ON THE SAME DAY OR ON THE NEXT DAY, WOULD DISCLOSE THAT THE ASSESSEE WAS HAVING AVAILABILITY OF THE CASH FOR FUR THER DEPOSIT IN THE SAME BANK ACCOUNT MAINTAINED WITH KOTAK MAHIND RA BANK, RAJPURA. THE A.O. HAS NOT BROUGHT ANY EVIDENC E ON RECORD TO PROVE THAT THE ASSESSEE HAS SPENT THE AMOUNT WIT HDRAWN SOMEWHERE ELSE. THE THEORY OF PEAK CREDIT IS NOT APPL ICABLE IN THE CASE OF THE ASSESSEE BECAUSE THE ASSESSEE NEVER ACCEPTED IT TO BE UNEXPLAINED MONEY. THEREFORE, IN THE ABSENCE O F COMPLETE DETAILS AND CONSIDERING THE FACT THAT THE AMOUNT OF CASH WAS ROTATING IN THE BANK ACCOUNT OF THE ASSESSEE WITH KO TAK MAHINDRA BANK, RAJPURA BY MAKING CASH DEPOSITS AND IMMEDIATELY WITHDRAWING THE SAME WOULD SHOW THAT THE ENTIRE CASH DEPOSITS IN THE BANK ACCOUNT MAY NOT BE UNEXPLA INED AMOUNT OF THE ASSESSEE. THEREFORE, CONSIDERING THE T OTALITY OF THE FACTS AND CIRCUMSTANCES, IT WOULD BE REASONABLE AND PROPER TO GIVE SOME SUBSTANTIAL BENEFIT TO THE ASSESSEE FOR TH E PURPOSE OF DELETING PART OF ADDITION ON THIS ISSUE. IN VIEW OF THE A BOVE DISCUSSION, WE ARE OF THE VIEW THAT ENDS OF JUSTICE WOULD MEET IF THE ADDITION OF RS.10 LACS IS DELETED. THE ADDITION MAY BE RESTRICTED TO RS. 7,35,2007- ONLY. WE ACCORDINGLY, MOD IFY THE ORDERS OF THE AUTHORITIES BELOW AND DELETE THE ADDITIO N OF RS.10 LACS, THE ADDITION WOULD NOW BE RESTRICTED TO RS.7, 35,000/-. THE GROUND NOS. 1 AND 2 OF THE APPEAL OF THE ASSESSEE A RE PARTLY ALLOWED. 12(II) THE ITAT CHANDIGARH BENCH IN THE CASE OF I TO VS ASHOK KUMAR JAIN (SUPRA) HELD IN PARA 4 AS UNDER : 4. WE HAVE HEARD THE RIVAL SUBMISSIONS AND HAV E PERUSED ALSO THE MATERIALS ASSAILABLE ON RECORD. SHRI SUDHIR S EHGAL LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT ASSESSING O FFICER 13 WHILE COMPLETING THE ASSESSMENT HAD TOTALLY OVERLOO KED THE DETAILS OF CASH IN HAND AVAILABLE WITH THE ASSESSEE AS PER BALANCE SHEET AS ON 31.3.2007. HE FURTHER POINTED O UT THAT REGULAR BOOKS OF ACCOUNTS ARE BEING MAINTAINED BY T HE ASSESSEE AND ALL THE ENTRIES OF CASH WITHDRAWALS AN D CASH DEPOSITS ARE DULY RECORDED IN THE CASH LEDGER ACCOU NT. HE FURTHER POINTED OUT THAT THE RETURNS ARE BEING FILE D ON THE BASIS OF BOOKS OF ACCOUNT EVEN IN THE EARLIER YEARS . AS PER THE BALANCE SHEET, THE CASH IN HAND AVAILABLE WITH THE ASSESSEE ON 31.3.2007 WAS RS. 13,48,638/-. IT IS STATED THAT THE CASH AVAILABLE ON THE AFORESAID DATE WAS OUT OF WITHDRAWAL S MADE FROM ICICI BANK WHEREIN THE DEPOSITS BEFORE WITHDRAWALS WERE MADE AFTER TAKING LOAN OF RS. 20 LAKHS FROM CENTURIO N BANK OF PUNJAB AGAINST MORTGAGE OF RESIDENTIAL HOUSE OWNED BY THE ASSESSEE. AS REGARDS THE PROPOSE OF WITHDRAWALS, IT WA S EXPLAINED THAT CASH WAS WITHDRAWN WITH THE INTENTIO N TO BUY SOME PROPERTY AND SINCE THE PROPERTY WAS NOT PURCHA SED UPTO 31.3.2007, THE CASH WAS AVAILABLE WITH THE ASSESSEE . FINALLY, THE ASSESSEE DEPOSITED THE SAME IN THE BANK ACCOUNT DURING THE YEAR UNDER CONSIDERATION. IT IS RELEVANT TO OBS ERVE HERE THAT LD. CIT(A) HAS GIVEN THE DETAILS OF WITHDRAWAL S AND DEPOSITS IN THE IMPUGNED YEAR. AS PER CASH FLOW STA TEMENT SUBMITTED BY THE ASSESSEE BEFORE THE LOWER AUTHORIT IES, IT IS EVIDENT THAT ASSESSEE HAS WITHDRAWN AMOUNTS ON VARI OUS DATES IN THE MONTH OF MAY AND JUNE 2007 FROM HIS BAN K ACCOUNT AND THE TOTAL CASH AVAILABLE WITH HIM AS ON 1.7.2007 WAS RS. 17,34,638/-. IT IS ALSO APPARENT FROM THE RE CORDS THAT THE LD. CIT(A) HAS CALLED FOR A REMAND REPORT FROM THE ASSESSING OFFICER AND THE ASSESSING OFFICER IN HIS REPORT DATED 23.7.2012 DID NOT POINT OUT ANY DISCREPANCY WI TH REGARDS TO THE ASSESSEE'S CONTENTION REGARDING THE WI THDRAWALS FROM THE BANK ACCOUNT. THE LD. CIT(A) HAS CATEGORIC ALLY STATED THAT THE COPY OF THE BANK ACCOUNT, CASH FLOW STATEMENT AND THE BALANCE SHEET AS ON 31.3.2007 AND 31.3.2008 WERE SUBMITTED BEFORE THE ASSESSING OFFICER. ALL THE ENT RIES IN THE CASH FLOW STATEMENT WERE DULY RECORDED FROM THE BAN K ACCOUNTS AND REPRESENTED THE VARIOUS CASH WITHDRAWA LS AND 14 CASH DEPOSITS MADE BY THE ASSESSEE AFTER AVAILING THE BANK LOAN OF RS. 20 LAKHS. THE LD. CIT(A) HAS ALSO REJEC TED THIS CONTENTION OF THE ASSESSING OFFICER THAT THE ASSESSE E HAD MADE NEED BASED CASH WITHDRAWALS FROM HIS BANK ACCOUNT. SUBSEQUENT WITHDRAWALS WERE MADE ONLY AFTER THE WITHDRAWALS MADE EARLIER HAD BEEN UTILIZED BY THE A SSESSEE. ACCORDING TO CIT(A), MERELY BECAUSE CASH WAS WITHDRA WN ON A PARTICULAR DATE ALSO DOES NOT IMPLY THAT THE CASH A LREADY WITHDRAWN ON EARLIER DATES HAD BEEN UTILIZED. WE FULL Y ENDORSE THE ABOVE VIEW OF THE CIT(A). THE ASSESSING OFFICER HA S MADE THE OBSERVATION THAT IN THE CASE THE ASSESSEE WAS A CTUALLY HAVING CASH IN HAND OF RS. 13,48,638/- AS ON 1.4.20 07, THERE WAS HARDLY ANY REASON FOR MAKING FURTHER CASH WITHD RAWALS. THE LD. CIT(A) HAS CORRECTLY HELD THAT THIS OBSERVA TION OF THE ASSESSING OFFICER IS WITHOUT ANY BASIS. THE LD. CIT (A) FURTHER OBSERVED THAT ASSESSEE HAD EXPLAINED DURING THE COUR SE OF ASSESSMENT PROCEEDINGS THAT CASH WAS WITHDRAWN WITH THE INTENTION TO BUY SOME PROPERLY. THE LD. CIT(A) HAS CA TEGORICALLY OBSERVED THAT ACTUAL AMOUNT OF CASH REQUIRED IN THE SE CIRCUMSTANCES WOULD BE KNOWN TO THE ASSESSEE ONLY. HE HAS ALSO STATED THAT THERE IS NO BAR IN KEEPING THE CASH AT HOME ACCORDING TO REQUIREMENTS. THUS, OBSERVATIONS OF THE LD. CIT(A) ARE CORRECT AND, THEREFORE, WE DO NOT SEE ANY INFIR MITY IN THE ORDER OF THE CIT(A). THE QUESTION INVOLVED IN THIS C ASE IS OF FACTS AND THE LD. CIT(A) HAS CORRECTLY APPRECIATED THE FAC TS OF THE CASE AND DECIDED THE ISSUE CORRECTLY. IN VIEW OF THE ABOVE DISCUSSION, WE DO NOT FIND ANY MERIT IN THE APPEAL FILED BY THE R EVENUE AND ACCORDINGLY WE DISMISS THE SAME. 12(III) THE ITAT CHANDIGARH BENCH IN THE CASE OF ACIT VS JOGINDER PAL (SUPRA) CONSIDERED THE SAME IS SUE ON FILING OF THE CASH-FLOW STATEMENT, DISMISSED THE DEPARTMENTAL APPEAL. THE CASH WAS DULY REFLECTED I N THE WEALTH TAX RETURN. 15 12(IV) CONSIDERING THE ABOVE DISCUSSION, IT IS P ROVED BY THE ASSESSEE ON RECORD THAT ASSESSEE HAS MADE CA SH WITHDRAWALS DURING THE YEAR UNDER CONSIDERATION FRO M VARIOUS BANKS IN A SUM OF RS. 7.65 CR AND MADE RE- DEPOSIT OF CASH OF RS. 4.30 CR IN THE SAME YEAR OUT OF SUCH CASH WITHDRAWALS. THUS, ASSESSEE PROVED THAT ASSESSEE WAS HAVING AVAILABILITY OF THE CASH FOR RE - DEPOSIT IN OTHER BANK ACCOUNTS. THE ASSESSING OFFIC ER HAS NOT BROUGHT ANY EVIDENCE ON RECORD TO PROVE THA T ASSESSEE HAS SPENT THE AMOUNT OF WITHDRAWN OF CASH SOMEWHERE ELSE. THEREFORE, IN THE ABSENCE OF ANY ADVERSE MATERIAL AGAINST THE ASSESSEE ON RECORD, AUTHORITIES BELOW SHOULD NOT HAVE REJECTED THE EXPLANATION OF THE ASSESSEE. THE ONUS UPON REVENUE HAS NOT BEEN DISCHARGED IN ANY MANNER. 13. IN THIS VIEW OF THE MATTER, AUTHORITIES BELOW W ERE NOT JUSTIFIED IN CONSIDERING THE RE-DEPOSIT OF CASH OF RS. 3.13 CR AS UNEXPLAINED CASH DEPOSIT. WE, THEREFORE , SET ASIDE THE IMPUGNED ORDERS AND DELETE THE ADDITION O F RS. 3.13 CR IN ASSESSMENT YEAR 2009-10. 14. IN ASSESSMENT YEAR 2010-11, THE ASSESSING OFFIC ER MADE IDENTICAL ADDITION OF RS. 2,03,99,700/-. IT I S ADMITTED FACT THAT IN THIS YEAR, CASH DEPOSITS WERE OF RS. 4,20,83,700/- AGAINST CASH WITHDRAWALS OF RS. 7,60,15,550/-. THIS ISSUE IS ADMITTEDLY SAME AS HA VE BEEN CONSIDERED IN PRECEDING ASSESSMENT YEAR 2009-1 0, THEREFORE, FOLLOWING REASONS FOR DECISION FOR ASSES SMENT 16 YEAR 2009-10, WE SET ASIDE THE ORDERS OF AUTHORITIE S BELOW AND DELETE THE ENTIRE ADDITION. IN THE RESUL T, GROUND NOS. 3 IN BOTH THE APPEALS ARE ALLOWED. THI S ISSUE IS DECIDED IN FAVOUR OF ASSESSEE AND AGAINST REVENUE. 15. NO OTHER POINT IS ARGUED OR PRESSED. 16. IN THE RESULT, APPEALS OF THE ASSESSEE ARE PART LY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT. SD/- SD/- (ANNAPURNA GUPTA) (BHAVNESH SAINI ) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 8 TH NOVEMBER, 2016. POONAM COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT(A) 4. THE CIT,DR ASSISTANT REGISTRAR, ITAT/CHD