Shri Bishnu Ch. Dutta, Khudiram Palli, Amarpur, Gomati, Agartala - 799001, Agartala V. Income Tax Officer, Ward - Udaipur, Agartala City Centre, Paradise Chowmuhani, Agartala - 799001, Agartala

ITA 02/GTY/2018

• Counselvise Citation: [2019] 112 COUNSELVISE.COM (IT) 1174 (ITAT-GUWAHATI)
• Duration Of Justice: 1 year(s) 11 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-12-2019
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: SMC
• Assessment Year: 2014-2015
• Appeal Filed On: 05-01-2018
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: AMITAVA SEN J
• Assessee Lawyers: D K BISWAS
• Keywords: Peak credit
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL GAUHATI BENCH E COURT AT KOLKATA BEFORE SHRI S.S.GODARA, JUDICIAL MEMBER AND DR. A.L.SAINI, ACCOUNTANT MEMBER ITA NO. 0 2 / GAU / 2018 ASSESSMENT YEAR :2014-15 SRI BISHNU CH. DUTTA AMARPUR, AGARTALA-799001 [ PAN NO.AHOPD 8223 B ] V/S . INCOME TAX OFFICER, WARD-UDDAIPUR, AGARTALA CITY CENTRE, PARADISE CHOWMUHANI, CAMP AGARTALA-799001 /APPELLANT .. / RESPONDENT /BY APPELLANT SHRI D.K.BISWAS, ADVOCATE /BY RESPONDENT SHRI AMITAVA SEN, JCIT-DR /DATE OF HEARING 11-12-2019 /DATE OF PRONOUNCEMENT 18-12-2019 / O R D E R PER BEMCH:- THIS ASSESSEES APPEAL FOR ASSESSMENT YEAR 2014-15 ARISES AGAINST THE COMMISSIONER OF INCOME TAX (APPEALS)-SHILLONGS ORD ER DATED 30.10.2017 PASSED IN CASE NO. CIT(A)/SHG/10332/2016-17 INVOLVI NG PROCEEDINGS U/S 143(3) OF THE INCOME TAX ACT, 1961; IN SHORT THE A CT. HEARD BOTH THE PARTIES. CASE FILE PERUSED. 2. THE ASSESSEES SOLE SUBSTANTIVE GRIEVANCE RAISES IN THE INSTANT APPEAL CHALLENGES CORRECTNESS OF BOTH THE LOWER AUTHORITIE S ACTION TREATING HIS BANK DEPOSITS OF 24,80,052/- AS UNEXPLAINED DURING THE COURSE OF ASS ESSMENT AND UPHELD IN THE APPELLATE ORDER AS UNDER:- ITA NO.02/GAU/2018 ASSESSME NT YEAR: 2014-15 SH. BISHNU CH. DUTTA. VS. ITO WD-UDAIPUR PAGE 2 GROUND NO.4 THIS GROUND IS DIRECTED AGAINST ADDITION OF RS.24, 80,052/- 7.1 THE AO MADE THE ADDITION AT PARA (7) OF HIS ORD ER AND THE SAME IS REPRODUCED BELOW:- CASH DEPOSIT OF RS.24,80,052/- HAS BEEN FOUND REFL ECTED IN TOTALITY IN THE BANK ACCOUNTS MAINTAINED BY THE ASSESSEE. ON BEING ASKED ABOUT SUCH CASH DEPOSITS, THE A/R OF THE ASSESSEE TOLD THAT THE DEP OSITS ARE SALE PROCEEDS OF BRICKS OF THE FIRM M/S KAMAKHYA BRICK INDUSTRIES TO WHICH THE ASSESSEE IS A PARTNER. THE FACT OF RECEIVING SALARY, INTEREST, SH ARE OF PROFIT FROM THE FIRM BY THE ASSESSEE IS CONFIRMED FROM THE ITO, WARD-1, AGA RTALA. THE DEPOSITS ARE FOUND TO BE MADE IN THE BANK ACCOUNTS OF THE ASSESS EE. ON BEING ASKED WHY THOSE DEPOSITS SHOULD NOT BE CONSIDERED AS THE INCO ME OF THE ASSESSEE, THE A/R TOLD THAT THE ASSESSEE COLLECTED THE SUM ON BEH ALF OF HIS FIRM TO WHICH HE IS PARTNER AND DEPOSITED INTO HIS BANK ACCOUNT AND THOSE PARTICULAR DEPOSITS WERE TAKEN INTO ACCOUNT WHICH ARRIVING AT THE TURNO VER OF THE FIRM. THE A/R OF THE ASSESSEE WAS ASKED TO EXPLAIN WITH REASON AS TO WHY THE CASH WERE DEPOSITED INTO HIS BANK ACCOUNT. IT SHOULD NOT BE A DDED TO THE DECLARED TOTAL INCOME OF THE ASSESSEE. THE ASSESSEE MADE A SUBMISS ION IN THIS REGARD AND THE SAME IS NOT ACCEPTABLE. UNDER THE CIRCUMSTANCES, THREE LEFT NO OTHER ALTERN ATIVE BUT TO ADD THE ABOVE CASH DEPOSIT TO THE DECLARED TOTAL INCOME OF THE AS SESSEE. 7.2 IN THE WRITTEN SUBMISSION, THE A/R STATED THAT ASSESSEE WAS A PARTNER IN A FIRM NAMELY M/S KAMAKHYA BRICK INDUSTRIES. THE FIRM WAS MANUFACTURING BRICKS. IN ORDER TO ENCOURAGE INCREASE OF SALES, THERE WAS A PROVISI ON AT CLAUSE (9) OF THE PARTNERSHIP DEED WHEREIN IT WAS STATED THAT THE PARTNERS SHALL DEVOTE TIME AND ATTENTION TO THE BUSINESS OF THE FIRM AND THAT THE PARTNERS SHALL BE ENTITLED TO COMMISSION ON BOOK PROFIT OF THE FIRM FOR WORK RENDERED BY THEM AS PER THEIR RESPECTIVE SHARE OF PROFIT. APPELLANT WAS SELLING BRICKS ON BEHALF OF THE FIRM. THE SALE PROCEEDS RECEIVED IN CASH FIRM REMOTE SUB-DIVISION OF AMARPUR NEAR BANGLADESH BORDER WERE DEPOSITED BY THE ASSESSEE IN HIS INDIVIDUAL BANK A/C. THE AMOUNT OF SUCH SALE CAME TO RS.24,80,052/- . ASSESSEE WITHDRAW THE ENTIRE SALE PROCEEDS FROM A SSESSEES A/C AND DEPOSITS OF THE SAME IN FIRMS A/C. IT WAS STATED THAT LEDGER A CCOUNT SHOWING WITHDRAWAL OF SALE PROCEEDS FROM ASSESSEES ACCOUNT AND DEPOSIT OF THE SAME IN THE FIRMS ACCOUNT WERE PRODUCED BEFORE THE AO. A/R SUBMITTED THAT THE ACCOUNTS OF THE FIRM WERE DULY AUDITED. SALES DISCLOSED BY THE FIRM WAS RS.1,73,83 ,920/-. A/R ALSO STATED THAT DUE TO EFFORT OF ASSESSEE, SALES OF THE FIRM HA INCREAS ES SUBSTANTIALLY. COPY OF PARTNERSHIP DEED WAS FURNISHED. COPY OF CERTIFICATE IN WHICH AL L THE PARTNERS CERTIFIED THAT SALE OF BRICKS OF FIRM TO THE EXTENT OF RS.24,80,052/- WAS DEPOSITED IN THE BANK A/C OF ASSESSEE WAS ALSO FURNISHED. A/R ARGUED THAT TAXATI ON OF RS.24,80,052/- IN THE HAND OF THE ASSESSEE WAS TOTALLY UNCALLED FOR. 7.3 I HAVE CAREFULLY CONSIDERED THE MATER. A CLAIM HAD BEEN MADE THAT SALE PROCEEDS OF PARTNERSHIP FIRM WERE DEPOSITED INTO THE BANK A/ C OF ASSESSEE IN HIS CAPACITY AS BEING ONE OF THE PARTNERS. DOCUMENTARY EVIDENCES SU BMITTED BEFORE ME TO AUTHENTICATE THE CLAIM ARE AUDITED A/C OF THE SAID PARTNERSHIP FIRM. DEED OF PARTNERSHIP & JOINT CERTIFICATE FROM, ALL THE PARTN ERS STATING THAT SUCH SALES PROCEEDS OF THE FIRM WERE DEPOSITED IN ASSESSEES BANK ACCOU NT. NO OTHER DOCUMENTARY EVIDENCES WERE FURNISHED BEFORE ME. THE PAPERS SUBM ITTED BEFORE ARE NOT SUFFICIENT TO HOLD THE VIEW THAT SALE PROCEEDS OF FIRM WERE DE POSITED IN ASSESSEES BANK A/C. APPELLANT HAD NOT PRODUCED ANY RECORD TO SHOW THAT THE IMPUGNED DEPOSITS WERE NOTED IN THE LEDGER AND CASH BOOKS OF THE FIRM AS WHEN THE SAME WERE DEPOSITED AND WITHDRAWN IN CASH. CONFIRMATIONS GIVEN BY THE P ARTNERS CAN BE SELF-SERVING ITA NO.02/GAU/2018 ASSESSME NT YEAR: 2014-15 SH. BISHNU CH. DUTTA. VS. ITO WD-UDAIPUR PAGE 3 DOCUMENT ONLY. HAD THE ASSESSEE TRANSFERRED THE MON EY FROM HIS BANK A/C TO THAT OF THE FIRM A/C BY MEANS OF CHEQUES, THERE COULD NOT HAVE BEEN REASON TO DOUBT THE CLAIM BEING MADE. BUT THE SAME WAS NOT THE CASES. A SSESSEE HAD DEPOSITED CASH, WITHDREW CASH AND CLAIMED THAT THE CASH SO WITHDRAW N WAS DEPOSIT INTO THE FIRM ACCOUNT. IT BELIES COMMON LOGIC TO BELIEVE THAT ASS ESSEE SHOULD DEPOSIT CASH BELONGING TO THE FIRM IN HIS BANK A/C, WITHDRAW THE SAME IN CASH AND THEN DEPOSIT THE MONEY AGAIN INTO FIRMS A/C. FROM THE COPY OF AUDIT ED A/C OF THE FIRM, IT IS SEEN THAT THE FIRM WAS SHAVING BANK A/C WITH TRIPURA STATE CO OPERATIVE BANK AND SBI, AMANPUR. IT IS NOT UNDERSTOOD WHY ASSESSEE WAS NOT DEPOSITING THE CLAIMED SALE SUFFICIENT PROOF TO BUTTRESS AND FORTIFY HIS CLAIM. IN VIEW OF THIS, THE ACTION TAKEN BY THE AO IS UPHELD. GROUND NO. 2 IS DISMISSED . 3. MR. BISWAS VEHEMENTLY CONTENDS DURING THE COURS E OF HEARING THAT THE ASSESSEE HAD SOLD THE BRICKS OF HIS FIRM M/S KAMAKH YA BRICK INDUSTRIES AND MADE DEPOSITS IN HIS PERSONAL BANK ACCOUNT. HIS FUR THER CASE IS THAT LOWER AUTHORITIES HAVE ADMITTEDLY ACCEPTED ASSESSEES STA TUS AS PARTNER OF THE SAID FIRM. HIS THIRD ARGUMENT IS THAT EVEN IF ANY IMPUGN ED ADDITION HAS TO BE CONFIRMED IN PRINCIPLE, THE SAME BE RESTRICTED TO O NLY PROFIT ELEMENT OF BRICKS SALES THAN THE ENTIRE SUM. WE FIND NO MERIT IN ASSE SSEES ARGUMENTS. THE FACT REMAINS THAT NEITHER HE HAS PROVED FROM THE FIRMS RECORDS THAT ANY BRICK LOT HAD BEEN ASSIGNED TO HIM FOR CASH SALES NOR IS THER E ANY MATERIAL INDICATING HE HIMSELF TO HAVE BEEN ENGAGED IN BRICKS SALES IN PERSONAL CAPACITY. THIS BRICK SALES EXPLANATION DOES NOT INSPIRE OUR CONC URRENCE THEREFORE. WE THUS AFFIRM THE IMPUGNED ADDITION OF 24,80,052/- MADE IN BOTH THE LOWER PROCEEDINGS IN PREVIOUSLY. 4. MR. BISWAS LASTLY SUBMITS THAT IT IS NOT THE ENT IRE AMOUNT BUT ONLY THE PEAK FIGURE WHICH COULD BE ADDED AS UNEXPLAINED GOI NG BY COMPREHENSIVE EXAMINATION OF ASSESSEES CREDIT AND DEBIT ENTRIES DURING THE RELEVANT PERIOD. MR. SEN FAILS TO DISPUTE THAT NEITHER OF THE LOWER AUTHORITY HAS EXAMINED THIS PEAK CREDIT ISSUE. WE THEREFORE RESTORE THE LAST GR IEVANCE BACK TO THE ASSESSING OFFICER TO ASCERTAIN PEAK CREDIT ON ASSES SEES DEPOSITS AS PER LAW WITHIN THREE EFFECTIVE OPPORTUNITIES OF HEARING TO THE TAXPAYER. THE ASSESSEE IS DIRECTED TO APPEAR BEFORE THE ASSESSING OFFICER ON OR BEFORE 30.04.2020 WITH ITA NO.02/GAU/2018 ASSESSME NT YEAR: 2014-15 SH. BISHNU CH. DUTTA. VS. ITO WD-UDAIPUR PAGE 4 ALL RELEVANT DOCUMENTARY EVIDENCE ALONGWITH COPY OF THIS REMAND DIRECTION TO THIS EFFECT. 5. THIS ASSESSEES APPEAL IS PARTLY ALLOWED FOR STA TISTICAL PURPOSES IN ABOVE TERMS. ORDER PRONOUNCED IN THE OPEN COURT 18/ 12/2019 SD/- SD/- (A.L.SAINI) (S.S.GODARA) (ACCOUNTANT MEMBER) JUDICIAL MEMBER) KOLKATA, *DKP - 18 / 12 /201 9 / / COPY OF ORDER FORWARDED TO:- 1. /APPELLANT-SRI BISHNU CH. DUTTA AMARPUR, AGARTALA-7 99991 2. /RESPONDENT-ITO WD-UDAIPUR, AGARTALA CITY CENTRE, PARADISDE CHOWMUHANI CAMP, AGARTAL A-799001 3. * - / CONCERNED CIT GUWAHATI 4. -- / CIT (A) GUWAHATI 5. 0 33*, *, / DR, ITAT, GUWAHATI 6. 7 / GUARD FILE. BY ORDER/ , /TRUE COPY/ SR. PRIVATE SECRETARY, HEAD OF OFFICE/DDO *,