M/s Vision Commodities & Derivatives Pvt. Ltd., Ludhiana v. ITO, Ludhiana

ITA 1342/CHANDI/2010 | 2007-2008
Pronouncement Date: 30-10-2013 | Result: Dismissed

Appeal Details

RSA Number 134221514 RSA 2010
Bench Chandigarh
Appeal Number ITA 1342/CHANDI/2010
Duration Of Justice 2 year(s) 11 month(s) 5 day(s)
Appellant M/s Vision Commodities & Derivatives Pvt. Ltd., Ludhiana
Respondent ITO, Ludhiana
Appeal Type Income Tax Appeal
Pronouncement Date 30-10-2013
Appeal Filed By Assessee
Order Result Dismissed
Bench Allotted A
Tribunal Order Date 30-10-2013
Date Of Final Hearing 10-10-2013
Next Hearing Date 10-10-2013
Assessment Year 2007-2008
Appeal Filed On 25-11-2010
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL CHANDIGARH BENCH A CHANDIGARH BEFORE SHRI T.R.SOOD ACCOUNTANT MEMBER AND MS. SUSHMA CHOWLA JUDICIAL MEMBER ITA NO.1342/CHD/2010 ASSESSMENT YEAR : 2007-08 M/S VISION COMMODITIES & VS THE INCOME TAX OFF ICER DERIVATIVES PVT. LTD. WARD VI (3) 70 NEW LAJPAT NAGAR LUDHIANA. LUDHIANA. PAN : AACCV-2023R & ITA NO.1343/CHD/2010 ASSESSMENT YEAR : 2007-08 M/S BEST TRADE COMMODITIES VS THE INCOME TAX O FFICER PVT. LTD. WARD VI (1) 70 NEW LAJPAT NAGAR LUDHIANA. LUDHIANA. PAN : AACCB-7887P & ITA NO.1344/CHD/2010 ASSESSMENT YEAR : 2007-08 M/S BEST BUY COMMODITIES VS THE INCOME TAX OF FICER PVT. LTD. WARD VI (1) 70 NEW LAJPAT NAGAR LUDHIANA. LUDHIANA. PAN : AACCB-7846C & ITA NO.1345/CHD/2010 ASSESSMENT YEAR : 2007-08 M/S CITY COMMODITIES (P)LTD. VS THE INCOME TAX OFFICER 578 LSE BUILDING WARD VI (1) FEROZE GANDHI MARKET LUDHIANA. LUDHIANA. PAN : AACCC-3857A & ITA NO.1131/CHD/2011 ASSESSMENT YEAR : 2008-09 M/S BIG BULL COMMODITIES VS THE INCOME TAX OFF ICER PVT. LTD. WARD VI (1) 70 NEW LAJPAT NAGAR LUDHIANA. LUDHIANA. PAN : AACCB-7845B 2 & ITA NO.1132/CHD/2011 ASSESSMENT YEAR : 2008-09 M/S BEST TRADE COMMODITIES VS THE INCOME TAX OFFICER PVT. LTD. WARD VI (1) 70 NEW LAJPAT NAGAR LUDHIANA. LUDHIANA. PAN : AACCB-7887P & ITA NO.1133/CHD/2011 ASSESSMENT YEAR : 2008-09 M/S BEST BUY COMMODITIES VS THE INCOME TAX OF FICER PVT. LTD. WARD VI (1) 70 NEW LAJPAT NAGAR LUDHIANA. LUDHIANA. PAN : AACC B-7846C & ITA NO.11/CHD/2013 ASSESSMENT YEAR : 2009-10 M/S BEST TRADE COMMODITIES VS THE INCOME TAX OFFICER PVT. LTD. WARD VI (1) 70 NEW LAJPAT NAGAR LUDHIANA. LUDHIANA. PAN : AACC-7887P & ITA NOS.12&13/CHD/2013 A.YS.: 2006-07 & 2009-10 M/S CITY COMMODITIES & VS THE INCOME TAX OFFICE R TRADING SERVICES (P) LTD. WARD VI (1) 518 LSE BUILDING LUDHIANA. FEROZE GANDHI MARKET LUDHIANA. PAN : AACCC-3857A (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI ASHWANI KUMAR RESPONDENT BY : SHRI MANJIT SINGH DATE OF HEARING : 10.10.2013 DATE OF PRONOUNCEMENT : 30.10.2013 O R D E R PER BENCH THE PRESENT BUNCH OF APPEALS HAS BEEN FILED BY DIFF ERENT ASSESSEES AGAINST SEPARATE ORDERS OF THE CIT(APPEAL S) DATED 3 22.09.2010 28.09.2011 AND 15.10.2012 RELATING TO A SSESSMENT YEARS 2006-07 TO 2009-10 RESPECTIVELY AGAINST THE ORDER PASSED UNDER SECTION 143(3) OF THE INCOME-TAX ACT 1961 ( 'THE ACT' FOR SHORT). 2. IN ALL THE APPEALS COMMON GROUNDS OF APPEAL HAV E BEEN RAISED WHICH READ AS UNDER : 1. THAT ORDER PASSED U/S 250(6) OF THE INCOME TA X ACT 1961 IS AGAINST LAW AND FACTS ON THE FILE IN AS MUCH THE LD . COMMISSIONER OF INCOME TAX (APPEALS)-II LUDHIANA WAS NOT JUSTIFIED TO UPHOLD THE ACTION OF THE LD. ASSESSING OFFICER IN ADDING A SUM OF RS.26 40 500/- BY RESORT TO PROVISIONS OF SECTION 68 OF THE INCOME TAX ACT 1961. 2. THAT HE WAS FURTHER NOT JUSTIFIED TO REJECT THE APPELLANT'S PRAYER FOR PERMISSION TO PRODUCE THE BOOKS OF ACCOU NTS. 3. THE LD. CIT(A) GRAVELY ERRED IN UPHOLDING THE AD DITION WITHOUT TAKING INTO CONSIDERATION THE CONTENTS OF T HE STATEMENT RECORDED OF SH. S. K. SHARMA DIRECTOR OF THE APPE LLANT COMPANY BY THE LD. ADI DURING THE COURSE OF SURVEY U/S 133A DE SPITE SPECIFIC REQUESTS HAVING BEEN MADE. 4. THAT PRINCIPLES OF NATURAL JUSTICE WERE GROSSLY VIOLATED BOTH BY THE LD. ASSESSING OFFICER WHILE FRAMING THE ASSE SSMENT AND BY THE LD. CIT(A) IN THE ADJUDICATION OF THE PRESENT APPEA L AND AS A CONSEQUENCE THE ASSESSMENT MADE DESERVES TO BE ANN ULLED. 3. THIS BUNCH OF APPEALS RELATING TO DIFFERENT ASSE SSEES ON SIMILAR ISSUE WERE HEARD TOGETHER AND ARE BEING DISPOSED OF BY THIS CONSOLIDATED ORDER FOR THE SAKE OF CONVENIENCE. 4. THOUGH THE FACTS IN ALL THE APPEALS ARE IDENTICA L REFERENCE IS BEING MADE TO THE FACTS IN ITA NO. 1342/CHD/2010 IN ORDER TO ADJUDICATE THE ISSUE. 5. THE BRIEF FACTS OF THE CASE ARE THAT DURING THE YEAR UNDER CONSIDERATION THE ASSESSEE HAD FILED RETURN OF INC OME DECLARING TOTAL INCOME OF RS. 5744/- ON 30.10.2007. THE CASE OF TH E ASSESSEE WAS SELECTED FOR SCRUTINY. THE ASSESSEE HAD DECLARED I NCOME FROM BUSINESS OF BROKERAGE IN COMMODITIES AND STOCKS IN THE RETURN OF 4 INCOME FILED BY IT. THE ASSESSING OFFICER VIDE PAR A 3 NOTES RIGHT FROM THE BEGINNING I.E. VIDE QUESTIONNAIRE DATED 28 .08.2009 THEN VIDE ORDER SHEET ENTRY DATED 10.12.2009 ASSESSEE WA S ASKED TO PRODUCE COMPLETE BOOKS OF ACCOUNT. BUT DESPITE SO M ANY OPPORTUNITIES THE ASSESSEE DID NOT PRODUCE BOOKS O F ACCOUNT. THE STATEMENT OF SHRI S.K.SHARMA WHO WAS THE DIRECTOR IN ALL THE COMPANIES BEFORE US AND WAS ALSO PROPRIETOR OF FEW CONCERNS WAS RECORDED ON 14.12.2009 WHICH IS REPRODUCED AT PAGES 2 TO 4 OF THE ASSESSMENT ORDER. THE ASSESSEE EXPLAINED THAT HE A LONGWITH HIS WIFE WERE THE DIRECTORS IN ALL THE COMPANIES AND SHE WAS ALSO THE PROPRIETOR OF M/S B.K. COMMODITIES. THE TWO CONCERNS I.E. M/S SUPER FINVEST AND M/S S.K.SHARMA & CO. WORKED AS SHARE BROKERS AND RE ST OF THE COMPANIES AND FIRMS WERE WORKING AS BROKERS WAS TH E REPLY OF SHRI S.K.SHARMA TO EXPLAIN THE BUSINESS PLANS ADOPTED. A QUERY WAS RAISED DURING THE COURSE OF RECORDING OF STATEMENT AS TO T HE BOOKS OF ACCOUNT WHICH THE ASSESSEE PROMISED TO PRODUCE ON THE NEXT DAY. THE BANK STATEMENT OF M/S BIG BULL COMMODITIES PVT. LTD. WIT H CENTURIAN BANK PAKHOWAL ROAD LUDHIANA WAS CONFRONTED TO SHRI S.K. SHARMA IN WHICH HUGE CASH WAS DEPOSITED VIDE VARIOUS ENTRIES AND HE WAS ASKED TO EXPLAIN THE SOURCE OF CASH ENTRIES. IN REPLY IT W AS SUBMITTED THAT CASH DEPOSITED IS AS PER BOOKS OF ACCOUNT ON BEHAL F OF THE CLIENTS. HE WAS FURTHER ASKED TO PROVIDE THE NAME AND ADDRES SES OF THE CUSTOMERS/CLIENTS WHO HAD DEPOSITED THE SAID AMOUNT S. THE DIRECTOR OF THE ASSESSEE COMPANY CLAIMED THAT HE WOULD PROVI DE THE DETAIL FROM THE BOOKS OF ACCOUNT. HE WAS FURTHER ASKED TO PROD UCE ATLEAST 10 PERSONS AND IN REPLY IT WAS SUBMITTED THAT HE WOULD INFORM AFTER VERIFYING THE RECORD. THE TRANSACTION OF COMMODITY EXCHANGE WAS FURTHER EXPLAINED AND IT WAS FURTHER CLARIFIED THAT ONLY SHUBH KRISHNA COMMODITIES OF WHICH HUF WAS THE PROPRIETOR WAS RE GISTERED WITH 5 LUDHIANA COMMODITIES EXCHANGE AND THE OTHER COMPANI ES AND FIRMS IN WHICH HE WAS THE DIRECTOR OR PROPRIETOR WERE BR ANCHES/TRADERS OF SHUBH KRISHNA COMMODITIES. HE FURTHER IN RESPONSE TO QUERY NO. 5 ENLISTED THE NAMES OF THE COMPANIES/FIRMS WHICH WER E TRADING ON BEHALF OF M/S SHUBH KRISHNA COMMODITIES AND IT WAS ALSO EXPLAINED THAT THE TRANSACTION WAS BETWEEN CLIENT TO CLIENT A ND MAY BE NOT THROUGH THE EXCHANGE WHICH WAS AS PER THE PREVALEN T MARKET TRENDS WAS PERMISSIBLE AS COMMERCIAL TRANSACTIONS. HE FUR THER SUBMITTED THAT THE NECESSARY INFORMATION IN RESPECT OF THE TR ANSACTION WOULD BE PROVIDED ON THE NEXT DATE OF HEARING. ON THE NEXT DATE OF HEARING HE SUBMITTED THAT NO PERSONS WERE BEING PRODUCED ON TH E DATE AS HE HAD COME TO RECORD THE STATEMENT. IN RESPONSE TO QUERY NO. 24 ABOUT VARIOUS CASH CREDITS/DEPOSITS IN THE BANK ACCOUNT I N THE NAME OF DIFFERENT COMPANIES IN WHICH HE WAS THE DIRECTOR T HE SOURCE OF THE CASH DEPOSITS WAS QUEIRED FROM HIM HIS REPLY WAS T HE SAME AS EARLIER. IN REPLY TO A QUESTION DO YOU WANT TO SAY ANYTHING ELSE ? THE ANSWER WAS I WILL STATE FURTHER RELATING TO CASH DURING THE COURSE OF ASSESSMENT PROCEEDINGS. HOWEVER DURING THE COURSE OF ASSESSMENT PROCEEDINGS NO FURTHER EXPLANATION WAS FILED NOR ANY PERSONS WERE PRODUCED AS PROMISED EARLIER TO EXPLAI N THE SOURCE OF CASH DEPOSITED IN THE BANK ACCOUNT OF THE ASSESSEE. THUS THE ASSESSING OFFICER TREATED THE SAME AS UNEXPLAINED C ASH CREDITS IN THE HANDS OF THE ASSESSEE. THUS IN VIEW THEREOF THE A SSESSING OFFICER TREATED THE SAME AS UNEXPLAINED CASH CREDITS UNDER SECTION 68 OF THE INCOME TAX ACT.AND MADE AN ADDITION OF RS. 26 40 50 0/- BEING CASH DEPOSITED IN THE BANK ACCOUNT. 6. THE ASSESSEE FILED WRITTEN SUBMISSIONS BEFORE TH E CIT(APPEALS) WHICH ARE REPRODUCED UNDER PARA 2.2 AT PAGES 2 TO 7 OF THE APPELLATE ORDER. IN THE SAID REPLY THE MAIN THURUST OF ARGU MENT WAS THAT THE 6 ASSESSING OFFICER HAD RECORDED THE GENERALIZED STAT EMENT OF THE ASSESSEE AND HAD NOT RAISED QUESTIONS ON SPECIFIC E NTRIES IN THE BANK ACCOUNT. THE ASSESSEE FURTHER CLAIMED TO BE IN THE BUSINESS OR PROFESSION OF BROKER IN COMMODITIES AND STOCKS. RE LIANCE WAS PLACED ON VARIOUS JUDICIAL PROPOSITIONS IN THIS REGARD ST RESSING THAT THERE WAS NO MERIT IN THE ADDITION MADE ON ACCOUNT OF CAS H CREDIT IN RESPECT OF THE AMOUNTS WHICH ARE ENTERED IN THE BOO KS OF ACCOUNT. AN ALTERNATE PLEA WAS MADE IN RESPECT OF THE ADDITI ON OF PEAK CREDITS APPEARING IN THE BOOKS OF ACCOUNT. IT WAS FURTHER C LARIFIED BY THE LD. AR FOR THE ASSESSEE BEFORE THE CIT(APPEALS) THAT TH E INABILITY TO PRODUCE BOOKS OF ACCOUNT BEFORE THE ASSESSING OFFIC ER WAS REGRETTED THOUGH BOOKS WERE DULY MAINTAINED WERE AUDITED BY THE CHARTERED ACCOUNTANTS AND IT WAS FURTHER SUBMITTED THAT THE S AME COULD BE PRODUCED NOW EVEN BEFORE THE ASSESSING OFFICER. 7. THE CIT(APPEALS) HELD THAT IN THE ABSENCE OF THE BOOKS OF ACCOUNT AND NON-PRODUCTION OF ANY CLIENT WHO HAD A LLEGEDLY GIVEN CASH TO THE ASSESSEE FOR DEPOSIT IN THE BANK ACCOUN T THE ASSESSING OFFICER WAS JUSTIFIED IN HOLDING THAT THE PROVISION S OF SECTION 68 WERE APPLICABLE. IN RESPECT OF THE OBJECTION OF TH E ASSESSEE THAT ONLY A GENERALIZED STATEMENT WAS RECORDED BY THE ASSESSI NG OFFICER CIT(APPEALS) VIDE PARA 3.3 AT PAGE 8 OF THE APPELLA TE ORDER OBSERVED THAT ON GOING THROUGH THE BANK ACCOUNT IT WAS FOUND THA T THERE ARE ONLY TWO TYPES OF ENTRIES I.E. CASH DEPOSITS AND CH EQUES WITHDRAWN AND HENCE THE QUESTION OF RAISING QUESTION ABOUT SP ECIFIC ENTRIES DOES NOT ARISE. THE CIT(APPEALS) THEREAFTER MET WITH ALL THE OBJECTIONS RAISED BY THE ASSESSEE AND THE VARIOUS C ASE LAWS AND UPHELD THE DECISION OF ASSESSING OFFICER IN INVOKIN G THE PROVISIONS OF SECTION 68 OF THE ACT IN THE FACTS AND CIRCUMSTA NCES OF THE CASE. THE ALTERNATE PLEA OF MAKING ADDITION ON PEAK CREDI TS APPEARING IN 7 THE BANK ACCOUNT OF THE ASSESSEE WAS REJECTED AS TH ERE WERE ONLY TWO TYPES OF ENTRIES IN THE BANK ACCOUNT I.E. CASH DEPO SIT AND CHEQUE WITHDRAWN AND THE THEORY OF PEAK DEPOSITS COULD BE TAKEN ONLY IN CASES WHERE CASH DEPOSIT WAS MADE AND CASH WAS WITH DRAWN. IN RESPECT OF THE REQUEST OF THE ASSESSEE TO BE ALLOWE D TO PRODUCE THE BOOKS OF ACCOUNT THE SAME WAS REJECTED BY THE CIT( APPEALS) AS AMPLE OPPORTUNITIES WERE ALLOWED TO THE ASSESSEE DU RING THE ASSESSMENT PROCEEDINGS TO PRODUCE THE BOOKS OF ACCO UNT WHICH THE ASSESSEE FAILED TO DO. THE SAID REQUEST OF PRODUCT ION OF BOOKS OF ACCOUNT AS ADDITIONAL EVIDENCE AT THE APPELLATE STA GE WAS DISMISSED BY THE CIT(APPEALS) VIDE PARA 4.2 AT PAGE 11 OF THE APPELLATE ORDER. 8. THE ASSESSEE IS IN APPEAL AGAINST THE ORDER OF T HE CIT(APPEALS). THE LD. AR FOR THE ASSESSEE ELABORATELY TOOK US THR OUGH THE FACTS OF THE CASE AND POINTED OUT THAT AS THE ASSESSEE HAD M AINTAINED BOOKS OF ACCOUNT AND THE ENTRIES IN THE BANK ACCOUNT WERE RE CORDED IN THE BOOKS OF ACCOUNT THE PROVISIONS OF SECTION 68 OF T HE ACT WERE NOT ATTRACTED AND THERE WAS NO MERIT IN THE AFORESAID A DDITION. IT WAS FURTHER POINTED OUT THAT THE SAID DEPOSITS IN THE B ANK ACCOUNT HAVE BEEN REFLECTED AS INCOME FROM TRADING IN THE HAND S OF THE ASSESSEE AND REFERENCE WAS MADE TO THE PROFIT & LOSS ACCOUNT PREPARED BY THE ASSESSEE IN THIS REGARD. 9. THE LD. DR ON THE OTHER HAND POINTED OUT THAT T HE ISSUE IS SQUARELY COVERED BY THE RATIO LAID DOWN BY THE TRIB UNAL IN THE CASE OF SHRI SUDHIR KUMAR SHARMA HUF VS ITO & OTHERS (I TA NOS. 17 TO 20/CHD/2013).ORDER DATED 20.09.2013. 10. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE RECORD. WE FIND THAT THE IDENTICAL ISSUE OF CASH CREDITS IN THE BANK ACCOUNT AROSE BEFORE THE TRIBUNAL IN THE CASE OF SHRI SUDHI R KUMAR SHARMA 8 HUF VS ITO & OTHERS (ITA NOS. 17 TO 20/CHD/2013 ). THE TRIBUNAL VIDE ORDER DATED 20.09.2013 IN PARA 16 TO 29 HELD AS UNDER 16. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSE D THE RECORD. IN THE FACTS OF THE PRESENT CASE THE ASS ESSEE UNDER APPEAL IS FOR ASSESSMENT YEAR 2007-08 FOR THE PERIOD ENDING 31.3.2007. THE ASSESSEE DURING THE YEAR UND ER CONSIDERATION HAD FURNISHED RETURN OF INCOME DECLAR ING TOTAL INCOME OF RS.161 680/- FILED ON 01.11.2007. SURVEY U/S 133A OF THE ACT WAS CONDUCTED ON THE PREMISES O F THE ASSESSEE ON 31.10.2007 AND THE STATEMENT OF THE ASS ESSEE WAS RECORDED ON 31.10.2007. THE COPY OF THE STATEM ENT OF THE ASSESSEE RECORDED DURING THE COURSE OF SURVEY I S PLACED ON RECORD. A PERUSAL OF THE SAID STATEMENT REFLECT S THAT THE CLAIM OF THE ASSESSEE DURING SURVEY WAS THAT M/S SU PER FINVEST (P) LTD. WAS SUB-BROKER BY LSE SECURITIES L TD. AND ALSO WORKING AS SHARE BROKER. IN RESPECT OF M/S BI G BULL COMMODITIES P.LTD. AND M/S BEST BUY COMMODITIES P.L TD. THE ASSESSEE STATED THAT THESE WERE ENGAGED IN ACCOMMODATION ENTRIES; M/S SHUBH KRISHNA COMMODITIE S P.LTD. WAS STATED TO BE ENGAGED IN COMMODITY TRADIN G AND AS SUB-BROKER ON COMMISSION BASIS. IT WAS CLAIMED B Y THE ASSESSEE THAT IT WAS ENGAGED IN GIVING ACCOMMODATIO N ENTRIES. 17. THE CASE OF THE ASSESSEE WAS PICKED UP FOR SCRU TINY AND STATEMENT OF THE ASSESSEE WAS RECORDED ON 14.12 .2009. IN REPLY TO THE QUERIES RAISED BY THE ASSESSING OFF ICER WHILE RECORDING THE SAID STATEMENT THE PLEA OF THE ASSESSEE WAS THAT IT HAD RECEIVED CASH FROM ITS CLIENTS AND THE DETAILS WERE AVAILABLE IN BOOKS OF ACCOUNT WHICH WO ULD BE PROVIDED TO THE ASSESSING OFFICER ON THE NEXT DATE OF HEARING. THE ASSESSING OFFICER REQUISITIONED THE AS SESSEE TO PRODUCE ATLEAST 10 PERSONS WHO HAD DEPOSITED RS. ONE LAC AND ABOVE IN THE BANK ACCOUNT. THE ASSESSEE RE PLIED THAT HE WOULD VERIFY THE RECORD AND INFORM THE STAT US. IN ANOTHER QUERY RAISED BY THE ASSESSING OFFICER THAT LET ME KNOW HOW THE ABOVE PERSONS DEPOSITED THE CASH IN YO UR BANK THE REPLY OF THE ASSESSEE WAS CASH IS RECEI VED FROM CUSTOMERS AND THE SAME IS DEPOSITED IN BANK. IN V IEW OF THE COMMODITIES EXCHANGE THE ASSESSEE EXPLAINED TH AT THE LUDHIANA COMMODITIES EXCHANGE CHARGE TRANSACTION CHARGES FROM THE ASSESSEE AT THE RATES DEPENDING ON TURNOVER. THE CONCERN M/S SHUBH KRISHNA WHICH WAS THE PROPRIETOR CONCERN OF THE HUF OF THE ASSESSEE WAS CLAIMED TO BE REGISTERED WITH LUDHIANA COMMODITIES EXCHANGE AND OTHER COMPANIES AND FIRMS OF WHICH HE WAS THE DIRECTOR/PROPRIETOR WERE CLAIMED TO BE BRANCHES/TRA DERS OF M/S SHUBH KRISHNA COMMODITIES. IN VIEW OF THE ENTR IES OF TRADING BEING CARRIED OUT ON BEHALF OF THE M/S SHUB H KRISHNA BY THE VARIOUS COMPANIES/PROPRIETORY CONCER NS OWNED BY THE ASSESSEE IT WAS EXPLAINED THAT IN CAS E OF ONE OR TWO TRANSACTIONS THE COMMODITY EXCHANGE ENTRY WAS THROUGH THE EXCHANGE AND THE BALANCE ENTRIES WERE C LIENT TO CLIENT WHICH WERE PERMISSIBLE AS COMMERCIAL TRANSACTION AS PER PREVALENT MARKET TRENDS. THE A SSESSEE 9 CLAIMED THAT SODA CONFIRMATION SLIP VOUCHERS IN RES PECT OF COMMODITIES TRANSACTION WERE BEING MAINTAINED BY TH E ASSESSEE WHICH WOULD BE PROVIDED ON THE NEXT DATE OF HEARING. THE STATEMENTS WWAS AGAIN CONTINUED ON 21.12.2009 AND THE PLEA OF THE ASSESSEE WAS THAT IT HAD NOT BROUGHT ANY RECORD OR ANY PERSONS TO BE PRODUCED ALONGWITH HIMSELF ON THE SAID DATE OF HEARING AS H E HAD COME FOR RECORDING OF HIS STATEMENT. IN THE STATEM ENT SO RECORDED IN RESPECT OF VARIOUS CASH CREDITS/DEPOSI TS IN THE BANK ACCOUNTS IN THE NAME OF DIFFERENT COMPANIES IN WHICH HE WAS THE DIRECTOR/PROPRIETOR THE ASSESSEE WAS AS KED TO GIVE THE SOURCE OF THE SAID CASH DEPOSITS IN VARIOU S BANKS AND IT WAS STATED BY THE ASSESSEE THAT REPLY IS SA ME AS STATED ON 15.12.2009. HE FURTHER SUBMITTED THAT H E WOULD STATE FURTHER RELATING TO CASH DURING THE COURSE OF ASSESSMENT PROCEEDINGS. 18. THE ASSESSING OFFICER FROM THE PERUSAL OF THE B ANK ACCOUNTS OF THE ASSESSEE WORKED OUT THE CASH CREDIT S IN THE SAID BANK ACCOUNTS TOTALING TO RS.126 66 000/- AS P ER DETAILS IN ANNEXURE-B TO THE ASSESSMENT ORDER. THE ASSESSING OFFICER FURTHER NOTED THAT WHILE RECORDIN G THE STATEMENT THE ASSESSEE WAS ASKED TO PRODUCE 10 PER SONS FOR VERIFICATION AND THE ASSESSEE FAILED TO PRODUCE ANY PERSON FOR VERIFICATION NOR ANY CONFIRMATION WAS FI LED BY THE ASSESSEE. THE ASSESSEE HAD FAILED TO DISCHARGE THE INITIAL BURDEN CAST UPON HIM TO PROVE GENUINENESS O F THE AMOUNTS CREDITED IN HIS BOOKS OF ACCOUNT I.E. BY PR OVING THE IDENTITY OF THE PERSONS WHO HANDED OVER THE CA SH TO THE ASSESSEE OR PRODUCTION OF THE RELEVANT BOOKS OF ACC OUNT WHERE NAME ADDRESS AND TRANSACTIONS ENTERED BY THE M WERE REFLECTED NOR FURNISHING ANY DETAILS OF SUCH P ERSONS WHO HAD GIVEN HIM THE CASH AND EVEN CREDIT WORTHINE SS OF THE PERSONS GIVING CASH COULD NOT BE PROVED. THE AS SESSEE HAD FAILED TO FILE THE REQUISITE DETAILS DURING THE ASSESSMENT PROCEEDINGS. THE ASSESSING OFFICER THU S HELD THAT IN VIEW THEREOF WHETHER THE CASH DEPOSITS BEL ONG GENUINELY TO THE CUSTOMERS OR IT BELONGED TO THE AS SESSEE COULD NOT BE ASCERTAINED RESULTING IN THE GENUINEN ESS OF THE TRANSACTIONS BEING NOT PROVED. IT WAS ALSO A F INDING OF THE ASSESSING OFFICER THAT ONLY CASH DEPOSITS WERE MADE IN THE BANK ACCOUNT AND THERE WERE NO CASH WITHDRAWALS FROM THE SAID BANK. THE OUTGOINGS WERE ONLY CHEQUES WHI CH WERE UNVERIFIABLE. THE ASSESSEE HAD FAILED TO CORR OBORATE THE CASH DEPOSIT WITH ANY EVIDENCE OF THE IDENTITY OF THE DEPOSITOR OR ANY OTHER EVIDENCE. THE ASSESSING OFF ICER THUS MADE ADDITION OF RS.126 66 000/-. 19. THE PLEA BEFORE THE CIT(APPEALS) RAISED BY THE ASSESSEE WAS TWO-FOLD I.E. THE PROVISIONS OF SECTIO N 68 WERE NOT TO BE APPLIED AND IT BEST THE ADDITION COULD BE RESTRICTED TO THE PEAK CREDITS. THE CIT(APPEALS) U PHELD THE PEAK CREDIT THEORY TO BE APPLIED TO THE FACTS O F THE CASE AND RESTRICTED THE ADDITION TO RS.10 55 260/-. THE CIT(APPEALS) HOWEVER IN PRINCIPLE HELD THAT THE AS SESSING OFFICER WAS CORRECT IN HOLDING THAT THE ABOVESAID A DDITIONS WERE MAINTAINABLE IN VIEW OF THE PROVISIONS OF SECT ION 68 OF THE ACT. 10 20. THE ASSESSEE IS IN APPEAL BEFORE US IN RESPECT OF BOTH THE INVOKING OF PROVISIONS OF SECTION 68 IN THE PRE SENT CASE AND ALSO AGAINST THE ADDITION OF RS.10 55 260/-. T HE REVENUE IS AGGRIEVED BY THE APPLICATION OF PEAK CRE DIT THEORY IN THE HANDS OF THE ASSESSEE AND SECOND REL IEF ALLOWED TO THE ASSESSEE. 21. THE FIRST ISSUE TO BE ADDRESSED BY US IN THE PR ESENT FACTS AND CIRCUMSTANCES OF THE CASE IS WHETHER THE PROVISIONS OF SECTION 68 OF THE ACT ARE APPLICABLE TO THE FACTS OF THE PRESENT CASE. DURING THE COURSE OF SU RVEY CONDUCTED U/S 133A OF THE ACT ON 31.10.2007 IN THE STATEMENT RECORDED THE ASSESSEE ADMITTED TO BE ENG AGED IN THE BUSINESS OF GIVING ACCOMMODATION ENTRIES. THE MODUS- OPERANDI EXPLAINED DURING THE COURSE OF SURVEY WAS THAT THE ASSESSEE WAS RECEIVING THE AMOUNT IN CASH AND T HE SAME WERE BEING RETURNED VIDE CHEQUES THROUGH BANK ACCOU NTS. HOWEVER DURING THE COURSE OF ASSESSMENT PROCEEDING S THE STATEMENT OF THE ASSESSEE WAS AGAIN RECORDED WHEREI N WHEN CONFRONTED WITH THE BANK STATEMENT OF M/S BIG BULL COMMODITIES PVT. LTD. WITH CENTURIAN BANK PAKHOWAL ROAD LUDHIANA IN WHICH HUGE CASH WAS DEPOSITED BY VARIOUS ENTRIES THE ASSESSEE IN REPLY STATED THAT THE CASH WAS DEPOSITED AS PER BOOKS OF ACCOUNT ON BEHALF OF THE CLIENTS. VIDE QUERY NO.8 THE ASSESSEE WAS ASKED T O PROVIDE THE NAMES AND ADDRESSES OF THE CUSTOMERS/CL IENTS WHO HAD DEPOSITED THESE AMOUNTS. THE REPLY OF THE ASSESSEE IN THIS REGARD WAS IF DETAILS ARE THERE I WILL CHECK FROM BOOKS OF ACCOUNT AND PROVIDE THE SAME. THE ASSESSEE THEREAFTER WAS DIRECTED TO PRODUCE ATLEAS T 10 PERSONS WHO HAD DEPOSITED RS.1 LAC AND ABOVE IN THE BANK ACCOUNT. THE ASSESSEE EXPLAINED THAT HE WILL VERIF Y FROM RECORD AND LET THE ASSESSING OFFICER KNOW ABOUT IT. IN REPLY TO QUERY NO.10 THE ASSESSEE CLAIMED THAT CAS H IS RECEIVED FROM CUSTOMERS AND SAME IS DEPOSITED IN BA NK. THE PLEA OF THE ASSESSEE BEFORE THE ASSESSING OFFIC ER WAS THAT HE WAS ENGAGED IN THE BUSINESS OF COMMODITIES AND QUERY NO.12 13 WERE RAISED IN RESPECT OF THE COMMI SSION RECEIVED FROM LUDHIANA COMMODITIES EXCHANGE. THE R EPLY OF THE ASSESSEE TO QUERY NO.13 I.E. ARE YOU REGIST ERED WITH LUDHIANA COMMODITY EXCHANGE WAS THAT ONLY M/ S SHUBH KRISHNA OF WHICH HUF IS THE PROPRIETOR AND I AM KARTA OF HUF IS REGISTERED WITH LCE AND OTHER COMPA NIES AND FIRMS IN WHICH I AM DIRECTOR OR PROPRIETOR ARE BRANCHES/TRADERS OF M/S SHUBH KRISHNA COMMODITIES. THE QUERY NO.14 WAS WHETHER THE SAID COMPANIES/FIR MS WHO WERE THE TRADERS OF M/S SHUBH KRISHNA WERE PAYI NG ANY CHARGES TO M/S SHUBH KRISHNA THE REPLY OF THE ASSESSEE IN THIS REGARD WAS THAT HE WOULD LET THE ASSESSING OFFICER KNOW AFTER CHECKING THE SAME. QUERY NO. 16 TO 19 AND THEIR ANSWERS WERE AS UNDER: Q:-16 IS THE TRANSACTION MADE BY ABOVE STATED COMPANIES THROUGH RECOGNIZED COMMODITIES EXCHANGE OR NOT. ANS: T IS THROUGH EXCHANGE IN ONE OR TWO CASE S IS OTHER CASES IT MAY BE CLIENT TO CLIENT. M/S B.K COMMODIT IES AND M/S 11 M.K COMMODITIES ARE REGISTERED WITH LUDHIANA COMMO DITIES EXCHANGE OTHERS ARE NOT. Q:-17 YOU HAVE STATED THAT IN SOME CONCERNS I R OUTED BUSINESS PRIVATELY NOT THROUGH MCX. IT MEANS YOU R UNNING A PARALLEL COMMODITIES EXCHANGE PLEASE EXPLAIN THE S AME. ANS: T IS NOT CORRECT THAT WE ARE RUNNING PAR ALLEL RUNNING EXCHANGE HOWEVER CLIENT TO CLIENT DEALING AS PER P REVALENT MARKET RATE ARE PERMISSIBLE AS COMMERCIAL TRANSACTI ONS. Q-.-18 YOU ARE REQUESTED TO PROVIDE THE SODA BO OK MAINTAINED BY YOU FOR RUNNING THE BUSINESS. ANS: WHAT EVER IS AVAILABLE RELATING TO THESE TRANSACTIONS WILL BE PROVIDED ON THE NEXT DATE. Q:-19 WHICH TYPE DOCUMENTS YOU TAKE FROM THE CLIENT/CUSTOMER & WHEN YOU DO THE TRANSACTION FOR T HEM. ANS: IT IS SODA CONFIRMATION SLIP VOUCHER CO MMODITIES BE PROVIDE TOMORROW. STATEMENT WILL BE CONTINUED ON 15.12.2009. IN CONTINUATION TO THE ABOVE STATEMENT. 21.12.2009. 22. A BARE PERUSAL OF THE STATEMENT RECORDED DURING THE COURSE OF ASSESSMENT PROCEEDINGS REFLECT THAT THE C LAIM OF THE ASSESSEE TO HAVE CHANGED. THE ASSESSEE ADMITS THAT ONLY M/S SHUBH KRISHNA WAS REGISTERED WITH LUDHIANA COMMODITIES EXCHANGE AND REST ALL THE CONCERNS WERE THE BRANCHES OR TRADERS OF M/S SHUBH KRISHNA COMMODITIE S. IN RESPECT OF THE CASH DEPOSIT IN THE BANK ACCOUNT OF ONE OF THE CONCERN THE ASSESSEE STATED THAT IT HAD RECEIV ED CASH FROM VARIOUS PARTIES AND THE SAME WAS AS PER THE BO OKS OF ACCOUNT. THE CASE OF THE ASSESSEE WAS THAT IT WAS RECEIVING CASH FROM ITS CLIENTS. BUT BEFORE THE ASSESSING OFF ICER IT WAS NOT THE CASE OF THE ASSESSEE THAT IT WAS ENGAG ED IN PROVIDING ACCOMMODATION ENTRIES. IN RESPECT OF THE ENTRIES NOT BEING THROUGH THE EXCHANGE THE ASSESSEE CLAIME D THAT CLIENT TO CLIENT TRANSACTIONS WERE PERMISSIBLE AS COMMERCIAL TRANSACTIONS. THE STATEMENT WAS CONTINU ED ON 21.12.2009 AND AS PER QUERY NO.24 THERE WAS A SPEC IFIC QUERY RAISED TO EXPLAIN VARIOUS CASH CREDITS/DEPOSI TS IN THE BANK ACCOUNTS OF DIFFERENT COMPANIES IN WHICH THE A SSESSEE WAS THE DIRECTOR AND THE ASSESSEE WAS ALSO ASKED TO GIVE SOURCE OF CASH DEPOSITS IN VARIOUS ACCOUNTS. IN RE PLY TO THE SAME A SHORT REPLY WAS GIVEN BY THE ASSESSEE THAT IT IS THE SAME AS WHAT IS STATED ON 15.12.2009. AT THE CONCL USION OF RECORDING OF THE STATEMENT THE ASSESSEE STATED THA T HE WOULD FURTHER EXPLAIN RELATING TO THE CASH DURING THE COURSE OF ASSESSMENT PROCEEDINGS. HOWEVER THE ASS ESSEE FAILED TO PRODUCE THE BOOKS OF ACCOUNT NOR GIVE ANY EXPLANATION VIS--VIS THE SOURCE OF CASH DEPOSITS I N THE BANK ACCOUNT. IN THE ABSENCE OF ANY EXPLANATION OR ANY EVIDENCE BEING PRODUCED BY THE ASSESSEE. THE ONUS C AST UPON THE ASSESSEE NOT BEING DISCHARGED THE SAID CA SH CREDITS ARE TO BE INCLUDED AS INCOME OF THE ASSESSE E IN VIEW OF THE PROVISIONS OF SECTION 68 OF THE ACT. 23. SECTION 68 OF THE ACT READS AS UNDER : 12 68. WHERE ANY SUM IS FOUND CREDITED IN THE BOOKS OF A N ASSESSEE MAINTAINED FOR ANY PREVIOUS YEAR AND THE ASSESSEE OFFERS NO EXPLANATION ABOUT THE NATURE AND SOURCE T HEREOF OR THE EXPLANATION OFFERED BY HIM IS NOT IN THE OPINION O F THE ASSESSING OFFICER SATISFACTORY THE SUM SO CREDITE D MAY BE CHARGED TO INCOME-TAX AS THE INCOME OF THE ASSESSEE OF THAT PREVIOUS YEAR : PROVIDED THAT WHERE THE ASSESSEE IS A COMPANY (NOT BEING A COMPANY IN WHICH THE PUBLIC ARE SUBSTANTIALLY INTER ESTED) AND THE SUM SO CREDITED CONSISTS OF SHARE APPLICATION M ONEY SHARE CAPITAL SHARE PREMIUM OR ANY SUCH AMOUNT BY WHATEV ER NAME CALLED ANY EXPLANATION OFFERED BY SUCH ASSESSEE-CO MPANY SHALL BE DEEMED TO BE NOT SATISFACTORY UNLESS ( A ) THE PERSON BEING A RESIDENT IN WHOSE NAME SUCH C REDIT IS RECORDED IN THE BOOKS OF SUCH COMPANY ALSO OFFERS A N EXPLANATION ABOUT THE NATURE AND SOURCE OF SUCH SUM SO CREDITED; AND ( B ) SUCH EXPLANATION IN THE OPINION OF THE ASSESSING OFFICER AFORESAID HAS BEEN FOUND TO BE SATISFACTORY: PROVIDED FURTHER THAT NOTHING CONTAINED IN THE FIRST PROVISO SHALL APPLY IF THE PERSON IN WHOSE NAME THE SUM RE FERRED TO THEREIN IS RECORDED IS A VENTURE CAPITAL FUND OR A VENTURE CAPITAL COMPANY AS REFERRED TO IN CLAUSE ( 23FB ) OF SECTION 10 . 24. UNDER THE PROVISIONS OF SECTION 68 OF THE ACT IT IS PROVIDED THAT WHERE THE ASSESSEE OFFERS NO EXPLANAT ION ABOUT THE NATURE AND SOURCE OF THE CREDITS IN THE B OOKS OF ACCOUNT ALL THE AMOUNTS SO CREDITED OR WHERE THE EXPLANATION OFFERED BY THE ASSESSEE IS NOT SATISFAC TORY IN RELATION TO THE SAME THEN SUCH CREDITS MAY BE CHAR GED TO TAX AS INCOME OF THE ASSESSEE FOR THAT PARTICULAR P REVIOUS YEAR. ADMITTEDLY IN THE CASE OF THE ASSESSEE VAR IOUS AMOUNTS IN CASH ARE DEPOSITED IN THE BANK ACCOUNTS OF THE ASSESSEE AND THE ONUS WAS UPON THE ASSESSEE TO EXPL AIN NATURE AND ALSO THE SOURCE OF THE SAID CASH DEPOSIT S. THE ASSERTION OF THE ASSESSEE IN THIS REGARD WAS THAT I T WAS THE AMOUNT RECEIVED FROM CLIENTS. HOWEVER THE ASSESSE E FAILED TO GIVE THE LIST OF SUCH PERSONS WHO HAD ADVANCED T HE SAID CASH TO THE ASSESSEE. THE ASSESSEE EVEN FAILED TO BRING ON RECORD ANY EVIDENCE TO PROVE ITS STAND THAT IT WAS THE AMOUNT RECEIVED FROM SUCH PERSONS WHO WERE HIS CLIE NTS. THE ASSESSEE FAILED TO FILE ANY CONFIRMATION IN RES PECT OF THE SAID CASH CREDITS NOR ANY OF THE PERSONS WERE P RODUCED FOR EXAMINATION BEFORE THE ASSESSING OFFICER THOUG H SPECIFIC DIRECTION IN THIS REGARD WAS GIVEN BY THE ASSESSING OFFICER WITHIN THE COURSE OF RECORDING OF STATEMENT OF THE ASSESSEE DURING ASSESSMENT PROCEEDINGS. THE ASSES SEE EVEN FAILED TO PRODUCE THE BOOKS OF ACCOUNT. IN TH E ABSENCE OF THE ASSESSEE HAVING DISCHARGED HIS ONUS OF PROVI NG THE IDENTITY CREDIT WORTHINESS AND GENUINENESS OF THE CASH TRANSACTION OF THE CASH CREDITS IN THE BANK ACCOUNT WE FIND NO MERIT IN THE PLEA OF THE ASSESSEE IN THIS REGARD AND DISMISS THE SAME. 13 25. ANOTHER PLEA RAISED BY THE LD. AR BEFORE US WAS THAT AS THE ASSESSEE WAS ENGAGED IN GIVING ACCOMMODATION ENTRIES ONLY COMMISSION SHOULD BE INCLUDED AS INCO ME OF THE ASSESSEE. ADMITTEDLY WHILE RECORDING THE STAT EMENT DURING THE COURSE OF SURVEY THE ASSESSEE HAD STATE D THAT IT WAS ENGAGED IN THE BUSINESS OF GIVING ACCOMMODATIO N ENTRIES. HOWEVER DURING THE COURSE OF ASSESSMENT PROCEEDINGS THE ASSESSEE DID NOT RAISE ANY SUBMISS IONS IN THIS REGARD AND ON THE OTHER HAND THE ASSESSEE TIM E AND AGAIN IN THE COURSE OF STATEMENT RECORDED DURING T HE ASSESSMENT PROCEEDINGS POINTED OUT THAT THE CASH D EPOSITED IN THE BANK ACCOUNT WAS AS PER ENTRIES IN THE BOOKS OF ACCOUNT AND THE SAME WOULD BE EXPLAINED FROM THE BO OKS OF ACCOUNT. THE PLEA OF ACCOMMODATION ENTRIES WAS NOT PUT TO THE ASSESSING OFFICER. HOWEVER BEFORE CIT(APPEALS ) A PLEA WAS RAISED THAT ONLY COMMISSION IS TO BE ADDED IN THE HANDS OF THE ASSESSEE IN VIEW OF VARIOUS JUDICIAL PRECEDENTS. A PERUSAL OF THE ORDER OF THE CIT(APPE ALS) DOES NOT REFLECT ANY FINDINGS ON THIS ISSUE AND ISS UES ADDRESSED BY THE CIT(APPEALS) WERE WHETHER PROVISIO NS OF SECTION 68 ARE APPLICABLE AND IN THE ALTERNATIVE W HETHER PEAK-CREDIT IS TO BE APPLIED IN THE HANDS OF THE AS SESSEE. THE ASSESSEE IN THIS GROUND OF APPEAL RAISED BEFORE THE TRIBUNAL HAS NOT RAISED ANY SUCH ISSUE OF THE COMMI SSION INCOME BEING INCLUDED IN HIS HANDS. ONLY TWO ISSUE S HAVE BEEN RAISED; I.E. INVOKING OF PROVISIONS OF SECTION 68 OF THE ACT AND CONFIRMATION OF ADDITION OF RS.1055 260/-. THE ISSUE OF WHETHER THE ASSESSEE IS ENGAGED IN GIVING ACCOMMODATION ENTRIES OR NOT IS A PURELY FACTUAL IS SUE WHICH HAS NOT BEEN RAISED BEFORE THE AUTHORITIES BE LOW I.E. DURING THE COURSE OF ASSESSMENT PROCEEDINGS OR EVEN BEFORE THE CIT(APPEALS) THE SAID ISSUE HAS NOT BEEN ADJUD ICATED. THE PLEA OF THE ASSESSEE OF ADMISSION OF SUCH NEW F ACTUAL ISSUE IS NOT ADMISSIBLE AT THIS STAGE OF ADJUDICATI NG OF THE APPEAL IN THE CAPTIONED YEARS. WE FIND NO MERIT IN THE SAID PLEA OF THE ASSESSEE AND THE SAME IS REJECTED. 26. WE ARE IN CONFORMITY WITH THE ORDER OF CIT(APPE ALS) IN HOLDING THAT THE PROVISIONS OF SECTION 68 OF THE ACT IN THE PRESENT SET OF FACTS AND CIRCUMSTANCES OF THE CASE ARE APPLICABLE AND WE UPHOLD THE ORDER OF CIT(APPEALS) IN THIS REGARD. 27. THE RELIANCE PLACED UPON BY THE ASSESSEE ON VAR IOUS CASE LAWS HAS BEEN REFERRED TO AND COMMENTED UPON B Y THE CIT(APPEALS) AND WE ARE IN CONFORMITY WITH THE FIND INGS OF CIT(APPEALS) IN THIS REGARD. 28. THE NEXT ISSUE RAISED IN THE PRESENT APPEALS IS IN RELATION TO THE APPLICABILITY OF PEAK CREDIT THEORY . IN THE FACTS OF THE PRESENT CASE THE SAID PEAK CREDIT THE ORY IS NOT APPLICABLE AS THE ASSESSEE HAD DEPOSITED CASH IN TH E BANK ACCOUNT AND THEREAFTER CHEQUES WERE ISSUED TO DIFF ERENT PARTIES. IT IS NOT A CASE WHERE CASH WAS DEPOSITED ON DIFFERENT DATES AND IN BETWEEN THERE WERE CASH WITHDRAWALS FROM THE BANK ACCOUNT. IT IS A CASE WH ERE THERE ARE DEPOSITS IN CASH BUT AS AGAINST THE SAID CASH DEPOSITED VARIOUS CHEQUES WERE ISSUED AND THE ASSE SSEE 14 WAS UNABLE TO EXPLAIN THE SOURCE OF CASH DEPOSITED IN HIS BANK ACCOUNT. REJECTING THE THEORY OF PEAK CREDITS APPLIED BY THE ASSESSING OFFICER WE REVERSE THE FINDINGS O F CIT(APPEALS) IN THIS REGARD AND RESTORE THE ADDITIO N MADE BY THE ASSESSING OFFICER AT RS. 1 26 66 000/-. WE FIND SUPPORT FROM THE RATIO LAID DOWN BY THE HON'BLE ALL AHABAD HIGH COURT IN BHAIYA LAL SHYAM BEHARI V COMMISSIONE R OF INCOME-TAX (SUPRA) WHEREIN THE COURT HELD AS UNDER : DURING THE ASSESSMENT YEAR IN QUESTION CERTAIN AMO UNT OF CASH CREDITS STANDING IN THE NAMES OF VARIOUS PE RSONS WERE ADDED IN THE INCOME OF THE APPLICANT BY INVOKI NG THE PROVISION OF SECTION 68 OF THE ACT. BEFORE THE TRIBUNAL THE ALTERNATIVE PLEA WAS TAKEN BY THE APPLICANT THA T IN THE EVENT DEPOSIT/CASH CREDITS ARE TREATED TO BE UNEXPL AINED THEN ONLY PEAK CREDIT IS TO BE ADDED. THE SUBMISSIO N HAS BEEN NEGATIVED BY THE TRIBUNAL IN THE FOLLOWING WOR DS : '13. LET US SUPPOSE THAT IN THE ACCOUNT OF 'A' THE RE WAS SHOWN A DEPOSIT OF RS. 10 000 ON APRIL 1 1978 AND IN THE ACCOUNT OF 'B' THERE WAS A DEPOSIT OF RS. 10 000 ON DECEMBER 1 1978. THE ASSESSEE HAS NOT ESTABLISHED THE GENUINENESS OF THESE TWO DEPOSITS. NOW ACCORDING TO THE ASSESSEE IN CASE THERE WAS A WITHDRAWAL OF RS. 10 0 00 IN THE ACCOUNT OF 'A' PRIOR TO THE DEPOSIT OF RS. 10 0 00 IN THE ACCOUNT OF 'B' THEN NO SEPARATE ADDITION SHOULD BE RESORTED TO ON ACCOUNT OF UNEXPLAINED DEPOSIT IN TH E ACCOUNT OF 'B'. ACCORDING TO THE ASSESSEE IT SHOUL D BE PRESUMED THAT THE DEPOSIT IN THE ACCOUNT OF 'B' WAS MADE OUT OF THE FUNDS WHICH WERE AVAILABLE TO THE ASSESS EE AFTER THE WITHDRAWAL OF THE AMOUNT FROM THE ACCOUNT OF 'A'. WE CANNOT SUBSCRIBE TO THIS POINT OF VIEW. ACC ORDING TO US IF THE ASSESSEE IS NOT ABLE TO PROVE THE GEN UINENESS OF THE DEPOSIT IN THE ACCOUNT OF 'B' A SEPARATE AD DITION IN RESPECT OF THAT WILL BE REQUIRED TO BE MADE. AS PER THE PROVISIONS OF SECTION 68 WHERE ANY SUM IS FOUND CR EDITED IN THE BOOKS OF AN ASSESSEE AND THE ASSESSEE OFFERS NO EXPLANATION ABOUT THE NATURE AND SOURCE THEREOF OR THE EXPLANATION OFFERED BY HIM IS NOT SATISFACTORY THE SUM SO CREDITED IS TO BE CHARGED TO INCOME-TAX AS THE INCO ME OF THE ASSESSEE. HENCE IT IS FOR THE ASSESSEE TO ESTA BLISH THE SOURCE OF THE DEPOSIT IN THE ACCOUNT OF 'B'. IF THE ASSESSEE ADMITS THAT THE ALLEGED DEPOSIT IN THE ACCOUNT OF ' A' WAS NOT GENUINE AND IN FACT IT WAS THE ASSESSEE'S OWN MONEY WHICH HAD BEEN INTRODUCED IN THE BOOKS IN THE GARB OF A LOAN FROM 'A' AND HENCE WHEN THIS AMOUNT WAS AVAILA BLE TO THE ASSESSEE FOR BEING INTRODUCED AS A FRESH DEP OSIT IN THE ACCOUNT OF 'B' THEN IT MAY BE POSSIBLE TO ACCEP T THE CONTENTION OF THE ASSESSEE. BUT IN CASE THE ASSESSE E ALL ALONG MAINTAINS THAT THE VARIOUS LOANS ARE GENUINE THEN WE FAIL TO UNDERSTAND AS TO HOW THE ASSESSEE CAN PU T FORWARD THE CLAIM THAT SEPARATE ADDITIONS FOR THE UNEXPLAINED CASH CREDIT IN DIFFERENT ACCOUNTS SHOUL D NOT BE MADE. WHEN THE ASSESSEE HIMSELF DOES NOT CONTEND THAT THE DEPOSIT MADE IN THE ACCOUNT OF 'B' IS OUT OF PRIOR WITHDRAWAL MADE IN THE ACCOUNT OF 'A' HOW DOES THE ASSESSEE EXPECT THE DEPARTMENT TO SUBSCRIBE TO THIS POINT OF VIEW. WE HENCE REJECT THIS CONTENTION OF THE ASS ESSEE.' 15 HEARD SRI KRISHNA AGRAWAL LEARNED COUNSEL FOR THE APPLICANT AND SRI SHAMBHU CHOPRA LEARNED STANDING COUNSEL FOR THE REVENUE. THE APPLICANT SUBMITTED THAT AS THE AMOUNT OF CASH CREDIT HAS BEEN TREATED TO TAX BY INVOKING THE PROVISIONS OF SECTION 68 OF THE ACT AND THE SAID AMOUNT HAVE BEEN TREATED AS INCOME FROM THE UNEXPLAINED SOURCE THE APPLICANT WAS ENTITLED TO TAKE UP A PLEA OF ADDITIO N OF THE AFORESAID PEAK CREDIT AS THE ENTIRE DEPOSITS HAVE B EEN TREATED TO BE INCOME OF THE APPLICANT. THE CONTENTI ON IS WHOLLY MISCONCEIVED. FOR ADJUDICATING UPON THE PLEA OF PEAK CREDIT THE FACTUAL FOUNDATION HAS TO BE LAID B Y THE ASSESSEE. HE HAS TO OWN ALL CASH CREDIT ENTRIES IN THE BOOKS OF ACCOUNT AND ONLY THEREAFTER THE QUESTION O F PEAK CREDIT CAN BE RAISED. AS IN THE PRESENT CASE THE AM OUNT OF CASH CREDITS WERE STANDING IN THE NAMES OF DIFFEREN T PERSONS WHICH ALL ALONG THE APPLICANT HAD BEEN CLAI MING TO BE GENUINE DEPOSIT WITHDRAWAL/PAYMENT OF THE AM OUNT TO DIFFERENT SET OF PERSONS DURING THE PREVIOUS YEA RS WOULD NOT AT ALL ENTITLE THE APPLICANT TO CLAIM BEN EFIT OF PEAK CREDIT. IN THIS VIEW OF THE MATTER WE DO NOT FIND ANY LEGAL INFIRMITY IN THE ORDER OF THE TRIBUNAL. WE ANSWER T HE AFORESAID QUESTIONS REFERRED TO US IN THE NEGATIVE I.E. IN FAVOUR OF THE REVENUE AND AGAINST THE ASSESSEE. THE RE WILL BE HOWEVER NO ORDER AS TO COSTS. OTHER INFORMATION IN FAVOUR OF REVENUE 29. THE GROUNDS OF APPEAL NO. 1(A) TO 1(C) RAISED B Y THE ASSESSEE ARE THUS DISMISSED AND THE GROUNDS OF APPEAL RAISE D BY THE REVENUE ARE ALLOWED. 11. IN FACTS AND CIRCUMSTANCES OF THE PRESENT CASE THE ISSUE STANDS COVERED BY THE ORDER OF THE TRIBUNAL IN THE CASE OF SHRI S.K.SHARMA & OTHERS (SUPRA). THE ASSESSEE BEFORE US HAS FAILE D TO FURNISH COMPLETE INFORMATION IN RESPECT OF THE CASH DEPOSIT S EITHER BEFORE THE AUTHORITIES BELOW OR EVEN BEFORE US. FURTHER THE ASSESSEE HAD FAILED TO PRODUCE THE BOOKS OF ACCOUNT BEFORE THE ASSESSIN G OFFICER DESPITE SEVERAL OPPORTUNITIES ALLOWED DURING THE COURSE OF ASSESSMENT PROCEEDINGS. EVEN BEFORE THE CIT(APPEALS) THOUGH THE ASSESSEE CLAIMED THAT IT CAN PRODUCE THE BOOKS OF ACCOUNT DU RING THE APPELLATE PROCEEDINGS BEFORE THE CIT(APPEALS) BUT THE SAID PL EA OF THE ASSESSEE WAS NOT ACCEDED BY THE CIT(APPEALS) AND THE SAME WA S REJECTED AS 16 THE ASSESSEE HAD FAILED TO FURNISH ON RECORD ANY OF THE CIRCUMSTANCES AS MENTIONED UNDER RULE 46A OF THE I.T. RULES. THE ALTERNATE PLEA OF THE ASSESSEE IN RESPECT OF PEAK CREDIT THEORY TO BE APPLIED TO THE ENTRIES IN THE BANK ACCOUNT CANNOT BE ACCEPTED AS T HE ASSESSEE HAD DEPOSITED CASH ON VARIOUS DATES IN THE BANK ACCOUNT AND IN-TURN HAD DRAWN MONEY THROUGH CHEQUES. THE SAID THEORY OF PE AK CREDIT COULD ONLY BE APPLIED WHERE IF AND WHEN THE ASSESSEE HAD MADE CASH DEPOSITS AND CASH WITHDRAWALS FROM THE BANK ACCOUNT . IN THE ABOVESAID FACTS AND CIRCUMSTANCES WHERE THE ASSESS EE HAD FAILED TO PRODUCE THE BOOKS OF ACCOUNT AND ALSO FAILED TO FUR NISH THE SOURCES OF THE CASH DEPOSITS IN THE BANK ACCOUNT OF THE ASSESS EE THE PROVISIONS OF SECTION 68 OF THE INCOME TAX ACT WERE CLEARLY AT TRACTED AND IN THE ABSENCE OF ANY SATISFACTORY EXPLANATION HAVING BEEN FURNISHED BY THE ASSESSEE THE SAID SUM IS TO BE ADDED AS INCOME OF THE ASSESSEE. 12. THE OTHER PLEAS OF THE ASSESSEE REGARDING NON-R ECEIPT OF THE STATEMENTS AND/OR NON SPECIFICATION OF BOOKS OF ACC OUNT IN THE SUMMONS ISSUED UNDER SECTION 131 OF THE ACT BEFORE THE CIT(APPEALS) HAS NO RELEVANCE AS ONUS WAS ON THE A SSESSEE TO PRODUCE THE BOOKS OF ACCOUNT IN ORDER TO EXPLAIN TH E SOURCE OF CASH ENTRIES IN THE BANK ACCOUNT AND THE ASSESSEE HAVING FAILED TO DO SO CANNOT TAKE SHELTER BEHIND SOME SURMISES AND CONJEC TURES. THE PERUSAL OF THE ASSESSMENT ORDER REFLECTS THE ASSESS ING OFFICER TO HAVE AFFORDED AMPLE OPPORTUNITIES TO THE ASSESSEE TO FUR NISH THE EXPLANATION AND ALSO THE CONFIRMATION IN RESPECT OF THE CASH CREDITS IN THE BANK ACCOUNT AND ALSO DIRECTIONS WERE GIVEN TO THE ASSESSEE TO PRODUCE ATLEAST 10 PERSONS OUT OF THE TOTAL NUMBER OF PERSONS WHO HAD ADVANCED CASH TO THE ASSESSEE BUT THE ASSESSEE FAILED TO COMPLY WITH THE DIRECTIONS OF THE ASSESSING OFFICER AND EV EN FAILED TO 17 PRODUCE THE BOOKS OF ACCOUNT. IN THE ABOVESAID FAC TS AND CIRCUMSTANCES OF THE CASE WE FIND NO MERIT IN THE STAND OF THE ASSESSEE IN THIS REGARD AND THE SAME IS DISMISSED. UPHOLDING THE ORDER OF CIT(APPEALS) WE CONFIRM THE ADDITION OF R S. 26 45 770/- MADE UNDER SECTION 68 OF THE ACT. THE GROUNDS OF A PPEAL RAISED BY THE ASSESSEE ARE THUS DISMISSED. 13. AS THE FACTS AND THE ISSUES OF ASSESSEE'S APPE AL IN ITA NOS 1343 1344 & 1345/CHD/2010 ITA NOS. 1131 1132 & 1 133/CHD/2011 AND ITA NOS. 11 12 AND 13/CHD/2013 ARE SIMILAR TO ITA NO. 1342/CHD/2010 OUR FINDINGS IN ITA NO. 1342/CHD/201 0 WOULD APPLY MUTATIS-MUTANDIS TO THESE APPEALS ALSO. 14. IN THE RESULT ALL THE APPEALS OF DIFFERENT ASS ESSEES ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 30 TH OCTOBER 2013. SD/- SD/- ( T.R.SOOD) (SUSHMA C HOWLA) ACCOUNTANT MEMBER JUDICIAL MEM BER DATED: 30 TH OCTOBER 2013 POONAM COPY TO: THE APPELLANT THE RESPONDENT THE CIT(A) THE CIT DR ASSISTANT REGISTRAR ITAT CHD.