Dineshkumar Somabhai Patel Vs ITO (ITAT Ahmedabad)
The sole issue in the matter is pertaining to the unexplained cash deposit of Rs. 32,00,000/-in various account of the assessee during the period of demonetization.
On appeal before CIT (A) it was argued that with respect to the cash of Rs.15 lakhs deposited in the Kukarwada Nagrik Sahakari Bank Ltd. bank account of the assessee, rectification order u/s 154 was already passed by the AO after considering the fact that the amount actually deposited was only 1.50 Lakh not Rs. 15 lakh. Even after the submission CIT (A) ignored the fact and upheld the addition amounting to Rs. 32,00,000/- not at Rs. 18,50,000/- which was result of rectification order passed by the AO. Further he submitted that cash book deposited before AO was not considered by the CIT (A) and upheld addition.
Before ITAT assessee argued placed the same submissions. On the other hand, DR argued that except for the cash book prepared by the assessee, no documents substantiating the entries in the cash book were filed. Therefore, the CIT(A) rightly rejected the cash book being unreliable and unable to sustain the source of the bank deposits.
Finally, ITAT partly allowed the appeal by reducing the amount of addition to Rs. 18,50,000/-after considering the rectification order passed by the AO. Assessee need to sustain the cash deposit by production of cash books/cash flow statement. ITAT further observed that the primary source of cash
deposited in Bank is attributed to cash withdrawn from his bank account almost four years back and no reason has been given by the assessee for holding such huge amount of liquid asset for such a long period of time and redepositing it later.
