Mojibar Rahaman, Malda V. I.T.O Wd - 2,Malda,Range, Malda

ITA 103/KOL/2013

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 4530 (ITAT-KOLKATA)
• Duration Of Justice: 3 year(s) 5 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-07-2016
• Appeal Filed By: Assessee
• Bench Allotted: B
• Next Hearing Date: 08-06-2016
• Assessment Year: 2008-2009
• Appeal Filed On: 16-01-2013
• Court: TRIBUNAL
• Department Lawyers: KALYAN NATH
• Keywords: Peak credit
• Section: 131; 68; 144

Judgement Text

1 ITA NO. 103/KOL/2013 MOJIBAR RAHAMAN AY 2008-09 IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH: KOL KATA [BEFORE SHRI N. V. VASUDEVAN, JM & SHRI M. BALAGAN ESH, AM] I.T.A NO.103/KOL/2013 ASSESSMENT YEAR: 2008-09 MOJIBAR RAHAMAN (PAN: AGPPR5560H) VS. INCOME-T AX OFFICER, WD-2, MALDA ( APPELLANT ) ( RESPONDENT ) DATE OF HEARING: 08.06.2016 DATE OF PRONOUNCEMENT: 08.07.2016 FOR THE APPELLANT: SHRI SUNIL SURANA, FCA FOR THE RESPONDENT: SHRI KALYAN NATH, JCIT, SR . DR ORDER PER SHRI M. BALAGANESH, AM: THIS APPEAL BY ASSESSEE IS ARISING OUT OF ORDER OF CIT(A), JALPAIGURI VIDE APPEAL NO. 45/MLD/CIT(A)/JAL/10-11 DATED 07.09.2012. ASSESSMEN T WAS FRAMED BY ITO, WD-2, MALDA U/S. 144 OF THE INCOME TAX ACT, 1961 (HEREINA FTER REFERRED TO AS THE ACT) FOR AY 2008-09 VIDE HIS ORDER DATED 20.12.2010. 2. THE ONLY ISSUE TO BE DECIDED IN THIS APPEAL IS AS TO WHETHER THE LD CITA IS JUSTIFIED IN UPHOLDING THE ADDITION MADE IN THE SUM OF RS. 13,38 ,589/- TOWARDS UNEXPLAINED CASH DEPOSITS MADE IN THE BANK ACCOUNT IN THE FACTS AND CIRCUMSTANCES OF THE CASE. 3. THE BRIEF FACTS OF THIS ISSUE IS THAT THE ASSES SEE DERIVED INCOME FROM RESALE BUSINESS OF MANGO AND COMMISSION FROM LIC AND OTHERS. THE R ETURN WAS FILED FOR THE ASST YEAR 2008-09 SHOWING NET PROFIT FROM MANGO BUSINESS AMOU NTING TO RS. 42,300/- (10.83% OF TURNOVER OF RS 3,90,600) ; NET COMMISSION INCOME FR OM LIC BUSINESS OF RS. 30,530/- (GROSS COMMISSION RECEIVED RS. 45,929/-) AND NET COMMISS ION INCOME FROM UNEDUCATED LABOURS WORKING IN MUMBAI TO THE TUNE OF RS. 35,171/- FOR U SING THE ASSESSEES BANK ACCOUNT WITH AXIS BANK, VASI BRANCH MUMBAI FOR TRANSFER OF MONEY TO THEIR FAMILY MEMBERS LIVING AT PANCHANANDAPUR MALDA. THE LD AO FOUND THAT THE AS SESSEE HAD MADE CASH DEPOSITS IN HIS 2 ITA NO. 103/KOL/2013 MOJIBAR RAHAMAN AY 2008-09 AXIS BANK VASI BRANCH VIDE A/C NO. SB 3890101000047 63 TO THE TUNE OF RS. 13,38,589/- AND ADDED THE SAME IN SECTION 144 ASSESSMENT AS UNE XPLAINED CASH CREDIT U/S 68 OF THE ACT. 4. BEFORE THE LD CITA , THE ASSESSEE EXPLAINED THA T THE BANK ACCOUNT WITH AXIS BANK, VASI BRANCH, MUMBAI WAS MAINTAINED FOR THE PURPOSE OF ENABLING THE UNEDUCATED LABOURS WORKING IN MUMBAI TO DEPOSIT THEIR CASH IN THE SAID BANK ACCOUNT FOR ONWARD TRANSFER OF THE SAME TO THEIR FAMILY MEMBERS. THIS SERVICE WAS REN DERED BY THE ASSESSEE TO THE UNEDUCATED LABOURS IN CONSIDERATION OF RECEIPT OF COMMISSION I NCOME THEREON. ACCORDINGLY, IT WAS EXPLAINED THAT THE MONIES IN THE SAID BANK ACCOUNT DOES NOT BELONG TO HIM AND INSTEAD THE ASSESSEE HAD ONLY ACTED AS A CONDUIT BY ALLOWING TH E MONIES TO BE DEPOSITED IN HIS BANK ACCOUNT BY THE UNEDUCATED LABOURS AND THE SAID MONI ES WERE LATER WITHDRAWN AND HANDED OVER TO THE FAMILY MEMBERS OF THE UNEDUCATED LABOUR S. THE ASSESSEE ALSO PRODUCED THE LIST OF 43 LABOURS TOGETHER WITH THEIR VOTER IDENTITY CA RDS ON WHOSE BEHALF HE HAD RENDERED THESE CASH DELIVERY SERVICES. THE LD CITA PICKED UP 3 P ERSONS OUT OF THESE 43 PERSONS ON TEST CHECK BASIS AND REQUESTED THE ASSESSEE TO PRODUCE T HEM IN PERSON. THE ASSESSEE ACCORDINGLY PRODUCED THREE PERSONS NAMELY MD MOKBUL HOSSAIN, NURUL SEKH AND SAMSUL HOQUE BEFORE THE LD CITA. STATEMENTS WERE RECORDE D U/S 131 OF THE ACT FROM THEM. MR SAMSUL HOQUE ADMITTED THAT HE HAD RECEIVED MONEY FR OM THE ASSESSEE. THE OTHER TWO PERSONS PUT THEIR LEFT THUMB IMPRESSION ON THE STAT EMENT WHICH WAS COMPARED WITH THAT ALREADY AVAILABLE WITH LD CITA IN THE LIST SUBMITTE D BY THE ASSESSEE, WHICH IN THE OPINION OF THE LD CITA, DID NOT MATCH ON A BARE EYE VIEW. THOS E TWO PERSONS DID NOT OFFER ANY COMMENT WHEN THEY WERE QUESTIONED ON THIS ASPECT. ACCORDINGLY, THE LD CITA REJECTED THEIR STATEMENTS. THE LD CITA OBSERVED THAT ALMO ST ALL 43 PERSONS SHOWN TO HAVE RECEIVED CASH OF RS. 30,135/- DURING THE YEAR FROM THE ASSES SEE. IN CASE OF LABOURER WORKING OUTSIDE THE STATE, IT IS IMPOSSIBLE THAT THROUGHOUT THE YEA R, EVERYONE RECEIVED SIMILAR IDENTICAL AMOUNT FROM THE LABOUR CONTRACTOR. THE LD CITA FU RTHER OBSERVED THAT MAKING TRANSACTIONS ON BEHALF OF OTHER PERSON UTILIZING HIS OWN BANK AC COUNT AND GETTING COMMISSION FROM THOSE PERSONS IS AN ILLEGAL ACT. ALTERNATIVELY IT WAS ARGUED THAT IN ANY CASE, ONLY THE PEAK CREDIT BALANCE COULD BE BROUGHT TO TAX AS THERE HAV E BEEN FREQUENT WITHDRAWALS AND DEPOSITS 3 ITA NO. 103/KOL/2013 MOJIBAR RAHAMAN AY 2008-09 IN THE SAID BANK ACCOUNT AND THE PREVIOUS WITHDRAWA LS WOULD GO TO PROVE THE SOURCE OF SUBSEQUENT DEPOSITS. THE LD CITA DID NOT HEED TO THE REQUEST OF THE ALTERNATIVE PLEA MADE BY THE ASSESSEE AND ACCORDINGLY UPHELD THE CASH CRE DIT ADDITION MADE BY THE LD AO. AGGRIEVED, THE ASSESSEE IS IN APPEAL BEFORE US ON T HE FOLLOWING GROUNDS :- 1. FOR THAT THE ORDER OF THE LD. CIT(A) IS ARBITR ARY, ILLEGAL AND BAD IN LAW. 2. FOR THAT THE LD. CIT(A) ERRED IN CONFIRMING THE ENTIRE DEPOSITS OF RS.13,38,589/- AS UNEXPLAINED CASH DEPOSIT IN THE BANK A/C FOR WHICH THE EXPLANATION WAS FILED. 3. FOR THAT EVEN OTHERWISE THE LD. AO SHOULD HAVE T AKEN ONLY THE PEAK OF THE DEPOSITS OF IN THE BANK ACCOUNT WHILE COMPUTING THE DEPOSITS DURING TH E ASSESSMENT YEAR IN QUESTION. 4. FOR THAT THE LD. CIT(A) SHOULD HAVE CANCELLED TH E ORDER MAY PLEASE BE MODIFY OR DELETED. 5. THE LD AR REITERATED THE SUBMISSIONS MADE BEFO RE THE LD CITA. APART FROM THAT, HE ARGUED THAT THE LD CITA HAD EXAMINED 3 PERSONS OUT OF 43 PERSONS ON TEST CHECK BASIS WHO HAD ADMITTEDLY CONFIRMED THE FACT THAT THEY HAD REC EIVED MONIES FROM THE ASSESSEE. IN CASE IF THE LEFT THUMB IMPRESSION DID NOT TALLY, THEN TH E SAME SHOULD HAVE BEEN SENT TO FORENSIC DEPARTMENT FOR VERIFICATION IN ORDER TO ASCERTAIN T HE TRUTH. WITHOUT DOING THE SAME, THE LD CITA SUMMARILY REJECTED THE CLAIM OF THE PARTIES AN D THE ASSESSEE. IN FACT, THE THREE PERSONS WERE SELECTED BY THE LD CITA AND ASSESSEE P RODUCED THEM AT THE INSTANCE OF THE LD CITA. IN RESPECT OF OBSERVATIONS OF THE LD CITA I N HIS ORDER THAT THE ASSESSEE HAD COMMITTED AN ILLEGAL ACT BY MAKING TRANSACTIONS IN HIS BANK ON BEHALF OF OTHER PERSONS FOR RECEIVING COMMISSION, HE ARGUED THAT EVEN THE INCOM E DERIVED FROM ILLEGAL BUSINESS IS CHARGEABLE TO TAX. HENCE THE OBSERVATION MADE THER EON IS UNWARRANTED. IN RESPONSE TO THIS, THE LD DR VEHEMENTLY RELIED ON THE ORDERS OF THE LOWER AUTHORITIES. 6. WE HAVE HEARD THE RIVAL SUBMISSIONS. WE FIND FROM THE FACTS AND CIRCUMSTANCES, THIS ISSUE REQUIRES COMPLETE RE-VERIFICATION BY THE LD A O AFRESH, IN ACCORDANCE WITH LAW. THE LD AO IS DIRECTED TO MAKE A FRESH ASSESSMENT AFTER HEA RING THE ASSESSEE AND THE EVIDENCES SUBMITTED THEREON, UNINFLUENCED BY EARLIER DECISION S TAKEN IN THIS REGARD, SO THAT A FAIR AND TRUE ASSESSMENT OF INCOME COULD BE DETERMINED OF TH E ASSESSEE TAKING INTO ACCOUNT ALL THE 4 ITA NO. 103/KOL/2013 MOJIBAR RAHAMAN AY 2008-09 RELEVANT FACTORS. ACCORDINGLY THE GROUNDS RAISED BY THE ASSESSEE ARE ALLOWED FOR STATISTICAL PURPOSES. 7. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS A LLOWED FOR STATISTICAL PURPOSES. ORDER IS PRONOUNCED IN THE OPEN COURT ON 08.07.201 6 SD/- SD/- (N. V. VASUDEVAN) (M. BALAGANESH) JUDICIAL MEMBER ACCOUNTAN T MEMBER DATED : 8 TH JULY, 2016 JD.(SR.P.S.) COPY OF THE ORDER FORWARDED TO: 1 . APPELLANT SHRI MOJIBAR RAHAMAN, LOYAITOLA, PANCHA NANDAPUR, P.S KALIACHAK, DIST. MALDA, PIN-732207 (WB). 2 RESPONDENT ITO, WARD-2, MALDA. 3 . THE CIT(A), JALPAIGURI 4. 5. CIT , JALPAIGURI DR, KOLKATA BENCHES, KOLKATA / TRUE COPY, BY ORDER, ASSTT. REGISTRAR .