IN INCOME TAX APPELLATE TRIBUNAL NEW DELHI BENCH : SMC-II, NEW DELHI BEFORE SHRI SUNIL KUMAR YADAV, JUDICIAL MEMBER ITA No.4916/DEL/2015 Assessment year : 2011-12 Income Tax Officer, Vs. Shri Krishan Singh, Ward-2, S/o. Shri Harpal Singh, Rohtak. H.No.108, VPO. Bahu Jamalpur, Gaddi Kheri, Rohtak. PAN: BSKPS 4326L APPELLANT RESPONDENT Appellant by : Shri S.K. Jain, Sr. DR Respondent by : Shri Naveen Gupta, Advocate Date of hearing : 15.09.2016 Date of Pronouncement : 21.09.2016 ORDER This appeal is preferred by revenue against order of CIT(Appeals), Rohtak dated 28.05.2015 relating to addition of Rs.43,63,000 made by Assessing Officer on account of unexplained deposits made in cash in assessees bank account. 2. facts in brief borne out from record are that initially assessment was completed u/s. 143(1) of Income-tax Act, 1961 [ Act ] vide order dated 28.11.2011. On basis of AIR information, Assessing Officer noticed that cash of Rs.43,63,000 has been deposited in IDBI Bank, Delhi Road, Rohtak. Assessee was asked to furnish copy ITA No.4916/DEL/2015 Page 2 of 6 of bank accounts maintained by him and his family members. He was also asked to explain source of deposits. In response thereto, assessee could furnish some information and most of time he sought adjournments on one reason or other. Being not convinced with explanation furnished by assessee, AO has made addition of Rs.43,63,000 on account of unexplained cash deposit in bank. 3. assessee preferred appeal before CIT(Appeals) and explained source of deposits before him. source of deposits explained by assessee was recorded by CIT(A) in para 2 of his order. I extract same for sake of reference:- 1. 863000/-: Appellant had deposited 188000/- on 8.6.2010, 375000/- on 12.6.2010 and 300000/ - on 28.6.2010, in cash in his bank account. Appellant is about 38 years old and doing business for last about more than 15 years. He is Income Tax assessee since A.Y. 2007-08. This amount was deposited by appellant out of his capital. Copy of ITR from A.Y. 2007-08 to 2011-12 are enclosed herewith at Page 4 to 8of PB. 2. 35,00,000/-: Appellant had deposited 35,00,000/- on 26.7.2010 in his bank account. Source of this amount is as under: (i) 863000/-: Appellant had deposited 188000/- on 8.6.2010 and 375000/- on 12.6.2010 in his bank account, which was transferred by him th. RTGS in M/s Tin Tin Infrastructure P. Ltd. as deposits. Appellant had also deposited 300000/- on 28.6.2010 in his bank account which was transferred by him th. RTGS to M/ s Inspire India Marketing P. Ltd. as deposits. This total amount of 863000/- was received back by appellant ITA No.4916/DEL/2015 Page 3 of 6 in cash from these companies on 25.7.2010, and was again deposited in bank account on 26.7.2010 in cash. Confirmation letters from companies are enclosed herewith at Page 9 and 10 of PB. (ii) 2637000/-: During year, appellant came in contact with one investment company M/s Forexx India Investments. company gave appellant lucrative offers and promised higher returns. Appellant became agent of company. He persuaded people to invest in company by promising them handsome returns on investments and collected 19500/- each from several of his relatives, friends and persons residing in his village and deposited collected amount in cash in his bank account. From there, he transferred amount to company M/ s Forexx India Investments, th. RTGS. Later on, company proves to be fraud and ran away with hard earned money of general public. Affidavits and proof of identity of 135 investors confirming transaction are enclosed at Page 11 to of PB. Since all these documents were in possession of other persons, appellant could not file these documents before AO during assessment proceedings. Hence application u/r 46A is also enclosed to admit all these documents as additional evidence. 4. On this explanation furnished by assessee, CIT(Appeals) has called for remand report from Assessing Officer and during remand proceedings, Assessing Officer directed assessee to appear in person and to produce 10 persons who filed affidavits. Accordingly, these persons have appeared and oral enquiries were made from these persons in which they have confirmed transaction in their statements. Accordingly remand report was submitted to CIT(A) and in ITA No.4916/DEL/2015 Page 4 of 6 light of remand report, CIT(A) has accepted explanation furnished by assessee and deleted addition. findings of CIT(Appeals) are extracted hereunder for sake of reference:- Rejoinder Respectfully submits that during remand proceedings, Assessing Officer directed appellant to appear in person and to produce 10 of persons who filed affidavits. In response, appellant appeared before AO and also produce 10 persons. AO make adequate oral enquiries from all these persons, all persons confirmed transaction in their statement and in his remand report, AO gave no adverse finding. In remand report, AO submitted that appellant had filed only copy of acknowledgement of return and no computation of income or capital account etc. was filed. In this regard, it is to submit that it is very strange on part of Assessing Officer to say that appellant didn't file computation of income or capital account etc. When appellant is providing copy of acknowledgement of return filed, to AO which clearly shows date of filing of return and its acknowledgement number, AO can very well investigate returns which were filed in his office. Moreover, Assessing Officer also never directed to appellant to file these documents. In view of above discussion, it is prayed that all additions made may kindly be deleted and appeal of appellant may kindly be allowed and oblige. 3. perusal of facts on record, remand report of AO dated 27.04.2015 and submissions made by appellant reveal that all transactions have been examined by AO and nothing adverse has been found after examining them. To state that no capital account or computation was filed is not conclusive finding when all returns were available with AO. No cogent evidence is on record for not accepting assessee's explanation. Nor have any enquiries been made by AO. Therefore, I delete said addition. ITA No.4916/DEL/2015 Page 5 of 6 5. Aggrieved, revenue is in appeal before Tribunal with submission that Assessing Officer has made out case that assessee has no sufficient means for deposits in cash, but CIT(A) has accepted same without any justifiable reasons. Whereas, ld. Counsel for assessee has contended that assessee has filed detailed explanation before CIT(Appeals) and CIT(A) has taken cognizance of same, after calling for remand report. 6. Having carefully examined order of lower authorities in light of rival submissions, I find that before Assessing Officer assessee could not furnish complete evidence with respect to source of deposits, but before CIT(Appeals) he has filed detailed explanation which was examined by CIT(Appeals) in light of remand report sought on additional evidence and being convinced with explanation of assessee, CIT(Appeals) has deleted addition. 7. During course of hearing, ld. DR could not point out specific defects in order of CIT(Appeals), whereas assessee has categorically explained that Rs.26,37,000 was collected from different persons on behalf of M/s. Forexx India Investments, which was deposited in his account and on next day it was transferred through RTGS to account of M/s. Forexx India Investments. Similar is position with respect to other deposits also. This explanation was examined by CIT(Appeals) ,but he could not find any fault therein. Since ITA No.4916/DEL/2015 Page 6 of 6 CIT(Appeals) has adjudicated issue in light of given facts and circumstances of case in right perspective, I find no infirmity therein and I confirm his order. 8. In result, appeal of revenue stands dismissed. Pronounced in open court on this 21st day of September 2016. Sd/- (SUNIL KUMAR YADAV ) Judicial Member New Delhi, Dated, 21st September, 2016. /D S/ Copy to: 1. Appellant 2. Respondent 3. CIT 4. CIT(A) 5. DR, ITAT, New Delhi. Assistant Registrar, ITAT, New Delhi. Income-tax Officer, Ward-2, Rohtak v. Krishan Singh