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Air notice

priyam uapdhyay(ca final) (Article Trainee) (70 Points)

30 May 2017

SIR I M HAVING VARIOUS QUESTION REGARDING AIR NOTICE , PLEASE REPLY WITH SUPPORTING CASE LAW IF POSSIBLE

1. amount of rs 2500000 withdrawn by cash from joint with my brother saving bank account and after incurring some expenses balance 1500000 deposited in the same joint saving bank account, now if notice is issued by the deptt on the basis of non pan air transaction rs 10 lac or more is justified.

2. whether amount deposted by way of cheque will be counted in this amount of rs 10 lac(which is applicable in saving bank account)

3. what to constitute rs 10 lac or more in saving bank account whether cheque/transfer/hard cash

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7 Replies

Dhirajlal Rambhia (SEO Sai Gr. Hosp.) (160332 Points)
Replied 30 May 2017

SIR I M HAVING VARIOUS QUESTION REGARDING AIR NOTICE , PLEASE REPLY WITH SUPPORTING CASE LAW IF POSSIBLE

1. amount of rs 2500000 withdrawn by cash from joint with my brother saving bank account and after incurring some expenses balance 1500000 deposited in the same joint saving bank account, now if notice is issued by the deptt on the basis of non pan air transaction rs 10 lac or more is justified.

YES Justified

2. whether amount deposted by way of cheque will be counted in this amount of rs 10 lac(which is applicable in saving bank account)

NO Only cash deposits counted.

3. what to constitute rs 10 lac or more in saving bank account whether cheque/transfer/hard cash

For AIR reporting only cash deposited of 10 lakhs or more, for savings acc.

priyam uapdhyay(ca final) (Article Trainee) (70 Points)
Replied 30 May 2017

thankyou sir

sir suppose there are four brothers mr.A,B,C,D all are farmers, resides in a village in which there are less banking facilities therefore they have only single joint saving bank account in the name of mr.d and mr.a in which mr d is the first party.

now if there is a rural agricultural land in the name of mr.a,b,c which is sold in the fy 08-09 for fully cash for rs 25 lac and the same is deposited in such joint saving bank account which is in the name of mr. d and mr.a.

now if notice is issued on the basis of non pan air transaction(10 lac or more in sb account) to mr. d only which is not involved in the sale of rurla agricultre land and only helped his brothers due to less banking faclities in their village, whether AO is correct in issuing notice to mr. d.

also my second question is that if thered is a direct nexus in the amount deposited that is i mean to say that if the whole amount is subsequently in the same year is utilized by mr.A,B,C for the purpose of purchase of another agricultural land, again in which mr.d is not involved

now if notice is issued on mr. d only on the basis of non pan air transaction , whether it will be justified?

please support your answer with a suitable case law if possible with proper reasioning.

Dhirajlal Rambhia (SEO Sai Gr. Hosp.) (160332 Points)
Replied 31 May 2017

"now if notice is issued on the basis of non pan air transaction(10 lac or more in sb account) to mr. d only which is not involved in the sale of rurla agricultre land and only helped his brothers due to less banking faclities in their village, whether AO is correct in issuing notice to mr. d."

The cases (for issue of notice) are selected based on AIR reporting. In your case the bank has to report the case of cash deposited in your account (first name). Bank do not know your internal relationship.

You will have to reply to the notice stating all the facts alongwith the proofs of the sale documents, otherwise Mr. D will be in big trouble.

"also my second question is that if thered is a direct nexus in the amount deposited that is i mean to say that if the whole amount is subsequently in the same year is utilized by mr.A,B,C for the purpose of purchase of another agricultural land, again in which mr.d is not involved "

Attach all the documents with the statements of the others, so that Mr D may come out safe!!

priyam uapdhyay(ca final) (Article Trainee) (70 Points)
Replied 31 May 2017

okay sir thnx it is usefull

Dhirajlal Rambhia (SEO Sai Gr. Hosp.) (160332 Points)
Replied 31 May 2017

My pleasure

priyam uapdhyay(ca final) (Article Trainee) (70 Points)
Replied 01 June 2017

sir,
can the AO assess the cash deposited in a joint saving account as income of the first holder only. if there is no suitable reply is given to him as assessee was an illiterate farmer he was not aware of legal proceedings while the second holder was involved in sale of land deed of which was submitted by assessee to the ao

is the ao justified

if no please suggest any case law

Dhirajlal Rambhia (SEO Sai Gr. Hosp.) (160332 Points)
Replied 01 June 2017

Here AO can take his own stand to charge any or both account holders after giving opportunity to hear from both of them for any clarification. No case laws required without proper justification given by the assessee.