If proper entry made in the cash book than cash amount cannot be in question in the assessesment

Last updated: 31 January 2012

Court :
INCOME TAX APPELLATE TRIBUNAL

Brief :
The brief facts of the above issue are that during the course of assessment proceedings, the AO from the capital accounts of the partners observed that a sum of Rs.5,27,500/- was introduced by each partner on 15.4.2005 and another sum of Rs.2,500/- was introduced by each partner on 23.2.2006. The assessee submitted before the AO that the partners Shri Gulam Rasul Sheikh and Shri Radique Shekhani were also partners in the firm M/s Adarsh Octroi Services from where the cash was withdrawn and introduced in the capital account of this firm. The AO required the assessee to explain the source of cash deposits. The assessee submitted that it was out of remuneration and profit received by the partners from M/s Adarsh Octroi Services. The AO did not accept the assessee’s explanation on the ground that date- wise withdrawal was not given and it is not clear whether the amount was withdrawn in cash or by cheque. In the absence of documentary evidences, the AO held that the claim of the assessee could not be accepted and added a sum of Rs.10,60,000/- as unexplained cash deposits to the total income of the assessee firm. On appeal, the ld. CIT(A) after examining the relevant accounts whi le observing that the total capital introduced was only Rs.10,55,000/- @ Rs.5,27,500/- by each partner, deleted the addition made by the AO

Citation :
Dy. Commissioner of Income Tax,25(1), C-11,Room No.202, Pratyakshakar Bhavan,Bandra- Kurla- Complex,Bandra (E), Mumbai 400051...........APPELLANT V/s M/s R.R.Bui lders, Room No.7,Tare Compound, Behind Krishna Hotel,Dahisar (E), Mumbai-400068.PAN:AAAFR3114J........RESPONDENT