DCIT Vs Smt. Veena Awasthi (ITAT Lucknow)
Conclusion: Addition made by AO merely on the ground that assessee made frequent withdrawal and deposit of his own money was not justified as the same was not prohibited under any law.
Held: AO had noted the behavioural pattern of assessee in frequently withdrawing cash and then depositing cash again in the bank account irrespective of having sufficient cash with her. He, therefore, added cash deposit made by assessee under the head income from undisclosed sources. It was noted that AO nowhere in his order had brought out any material on record to show that assessee was not having an additional source of income other than that disclosed in the return nor AO could spell out in his order that cash deposits made by assessee were from some undisclosed source. There is no law in the country which prevents citizens to frequently withdraw and deposit his own money. Documentary evidence furnished clearly clarified that on each occasion at the time of deposit in her bank account, assessee had sufficient availability of cash. Entire transaction of withdrawals and deposits were duly reflected in the bank account of assessee and were verifiable from relevant records. Thus, addition was not justified.
FULL TEXT OF THE ITAT JUDGMENT
This appeal preferred by the Revenue emanates from the order of ld. CIT(A)-I, Lucknow dated 29/1/2016 as per following grounds of appeal:-
1. On the facts and circumstances of the case, the Ld. CIT(A) has erred in deleting the addition of Rs.1,35,61,000/- failing to appreciate that the assessee could not establish any nexus between the frequent withdrawals and the subsequent deposit.
2. On the facts and circumstances of the case, the Ld. CIT(A) has failed to appreciate that the assessee could not discharge her onus of proving/ establishing the source of cash deposits and its re-deposits out of withdrawals by filing documentary evidences.
3. Appellant craves leave to add or amend the ground of appeal, as stated above as and when need of doing so arises with the prior permission of the Hon’ble Bench.
2. The only grievance of the Revenue is with regard to the deletion of addition of Rs.1,35,61,000/- by ld. CIT(A) which was added by the Assessing Officer as unexplained cash deposits in the hands of the assessee.
3. The facts in this case are that assessee is earning interest and remuneration as partner in the firm, M/s Arun Construction. Details of income from various sources, copies of bank statements, details of investments, etc. were furnished during assessment proceedings. After examination of bank statements filed during the course of assessment proceedings, it was gathered by the Assessing Officer that during previous year assessee deposited cash in the following bank accounts as per details mentioned against each, totaling to Rs.1,35,61,000/-:-
