COMMISSIONER OF INCOME TAX - II V. KAMLESHKUMAR RASIKLAL MEHTA

TAXAP/978/2013

AI Insights

The case involves a series of tax appeals by the Commissioner of Income Tax against Shaileshkumar Rasiklal Mehta and Kamleshkumar Rasiklal Mehta concerning additions made under Section 68 of the Income Tax Act for the assessment years 2001-02, 2002-03, and 2003-04. The primary issue was whether the ITAT was correct in upholding the CIT(A)'s decision to delete these additions, which were initially made by the Assessing Officer on the grounds of unexplained cash credits in the assessees' bank accounts. The CIT(A) had found that the assessees had adequately explained the sources of the cash credits, which were routed through their bank accounts. The High Court agreed with the lower authorities' findings, dismissing the appeals.

• Counselvise Citation: [2013] 140 COUNSELVISE.COM (IT) 699906 (HC-GUJARAT)
• Appeal Type: Others
• Pronouncement Date: 25-11-2013
• Assessment Year: misc
• Laws Referred To: Income Tax Act
• Result in Favour of: Others
• Court: HIGH COURT
• Assessee Lawyers: MAUNA BHATT
• Keywords: Assessment Year; Income Tax; Section 68; Unexplained cash credit
• Section: 68

Judgement Text

"O/TAXAP/977/2013 JUDGMENT IN THE HIGH COURT OF GUJARAT AT AHMEDABAD TAX APPEAL NO. 977 of 2013 TO TAX APPEAL NO. 980 of 2013 FOR APPROVAL AND SIGNATURE: HONOURABLE MR.JUSTICE M.R. SHAH and HONOURABLE MR.JUSTICE R.P.DHOLARIA ====================================== 1 Whether Reporters of Local Papers may be allowed to see the judgment ? 2 To be referred to the Reporter or not ? 3 Whether their Lordships wish to see the fair copy of the judgment ? 4 Whether this case involves a substantial question of law as to the interpretation of the Constitution of India, 1950 or any order made thereunder ? 5 Whether it is to be circulated to the civil judge ? ====================================== COMMISSIONER OF INCOME TAX - II....Appellant(s) Versus SHAILESHKUMAR RASIKLAL MEHTA....Opponent(s) ====================================== Appearance: MRS MAUNA M BHATT, ADVOCATE for the Appellant(s) No. 1 ====================================== CORAM: HONOURABLE MR.JUSTICE M.R. SHAH and HONOURABLE MR.JUSTICE R.P.DHOLARIA Page 1 of 6 O/TAXAP/977/2013 JUDGMENT Date : 25/11/2013 ORAL JUDGMENT (PER : HONOURABLE MR.JUSTICE M.R. SHAH) 1. As common question of law and facts arise in these group of appeals they are disposed of by this common order. 2. Being aggrieved and dissatisfied with the impugned common judgment and order passed by the Income Tax Appellate Tribunal (hereinafter referred to as ‘ITAT’) dated 08/05/2013 in ITA Nos. 562/Ahd/2008 with CO No.74/Ahd/2008 for the Assessment Year 2001-02 in the case of the assessee- Shri Saileshkumar Rasiklal Mehta and and ITA Nos. 1510, 1511 and 1512/Ahd/2008 for the Assessment Years 2001-02,2002- 03 and 2003-04 in the case of the assessee – Shri Kamleshkumar Rasiklal Mehta, the revenue has preferred the present Tax Appeals to consider the following substantial questions of law; 2.1. In Tax Appeal No. 977/2013, the revenue has proposed the following substantial questions of law; (A) “Whether the tribunal is right in law and on facts in upholding the order of the CIT(A) in deleting the addition made under Section 68 of the Act of unexplained cash credit of Rs.45,00,000/- in the bank account?” (B) “Whether the tribunal is right in law and on facts in not appreciating the fact that the assessee never produced his books of account before the Assessing Officer at the time of assessment nor he cooperated in Page 2 of 6 O/TAXAP/977/2013 JUDGMENT any manner whatsoever with the Assessing Officer in finalising the assessment by furnishing the books of account and other details?” 2.2. In Tax Appeal No. 978/2013, the revenue has proposed the following substantial questions of law; (A) “Whether the tribunal is right in law and on facts in upholding the order of the CIT(A) in deleting the addition made under Section 68 of the Act of unexplained cash credit of Rs.46,54,868/- in the bank account?” (B) “Whether the tribunal is right in law and on facts in not appreciating the fact that the assessee never produced his books of account before the Assessing Officer at the time of assessment nor he cooperated in any manner whatsoever with the Assessing Officer in finalising the assessment by furnishing the books of account and other details?” 2.3. In Tax Appeal No. 979/2013, the revenue has proposed the following substantial questions of law; (A) “Whether the tribunal is right in law and on facts in upholding the order of the CIT(A) in deleting the addition made under Section 68 of the Act of unexplained cash credit of Rs.2,13,053/- in the bank account?” (B) “Whether the tribunal is right in law and on facts in not appreciating the fact that the assessee never produced his books of account before the Assessing Page 3 of 6 O/TAXAP/977/2013 JUDGMENT Officer at the time of assessment nor he cooperated in any manner whatsoever with the Assessing Officer in finalising the assessment by furnishing the books of account and other details?” 2.4. In Tax Appeal No. 980/2013, the revenue has proposed the following substantial questions of law; (A) “Whether the tribunal is right in law and on facts in upholding the order of the CIT(A) in deleting the addition made under Section 68 of the Act of unexplained cash credit of Rs.5,78,779/- in the bank account?” (B) “Whether the tribunal is right in law and on facts in not appreciating the fact that the assessee never produced his books of account before the Assessing Officer at the time of assessment nor he cooperated in any manner whatsoever with the Assessing Officer in finalising the assessment by furnishing the books of account and other details?” 2.5. At the outset, it is required to be noted that in all these appeals the issue is with respect to the addition made by the Assessing Officer under Section 68 of the Income Tax Act on account of unexplained cash credit of respective amounts in the bank account of the respective assessee. The Assessing Officer made the following additions under Section 68 of the Income Tax Act on account of unexplained cash credit of respective amounts in the bank account of the respective assessee for the aforesaid Assessment Years. Page 4 of 6 O/TAXAP/977/2013 JUDGMENT Name of the assessee Assessment Year Additions made by the Assessing Officer under Section 68 of the Income Tax Act Shri Shaileshkumar Rasiklal Mehta 2001-02 Rs.45,00,000/- Shri Kamleshkumar Rasiklal Mehta 2001-02 Rs.46,54,868/- Shri Kamleshkumar Rasiklal Mehta 2002-03 Rs.2,13,053/- Shri Kamleshkumar Rasiklal Mehta 2003-04 Rs.5,78,779/- 2.6. Being aggrieved and dissatisfied with the aforesaid additions made by the Assessing Officer, respective assessee preferred appeals before the CIT(A) and the CIT(A) deleted the said additions by holding that the entire amount was routed to the bank account and the assessee discounted the cheques after the funds have been withdrawn from the bank. Thus, on merits the CIT(A) held that assessee explained the source and/or deposited the aforesaid amount. Consequently, the CIT(A) deleted the additions made by the Assessing Officer under Section 68 of the Income Tax Act treating the aforesaid amount, except the amount of Rs.10,000/- against the total amount of Rs.45,00,000/- made by the Assessing Officer in the case of Shaileshkumar Rasiklal Mehta in Tax Appeal No. 977/2013, as disclosed income. 3. Having heard Ms. Mauna Bhatt, learned Counsel appearing on behalf of the appellant and on perusal of the impugned common judgment and order passed by the ITAT as well as the finding given by the CIT(A) while deleting the additions made by the Assessing Officer, it appears that on appreciation of evidence and considering the fact that the additions made by the Assessing Officer routed through the Bank and the assessee explained the source of income and considering the same the CIT(A) has deleted the additions Page 5 of 6 O/TAXAP/977/2013 JUDGMENT made by the Assessing Officer, which was made by the Assessing Officer treating the same as undisclosed income. The assessee successfully proved the source of income and the same was routed through the Bank. Thus, the Assessing Officer was not justified in treating the same as undisclosed income and in making the additions under Section 68 of the Income Tax Act. 4. We are in complete agreement with the reasoning and the views taken by the CIT(A) as well as the ITAT in deleting the additions made by the Assessing Officer under Section 68 of the Income Tax Act. As such, no question of law, much less substantial question of law arises in the present appeals as the findings given by the CIT(A) confirmed by the ITAT are on appreciation of evidence. Under the circumstances, all the appeals deserve to be dismissed and are accordingly dismissed. (M.R.SHAH, J.) (R.P.DHOLARIA,J.) Siji Page 6 of 6 "