Shaileshbhai Fulchandbhai Jain, Ahmedabad V. The ACIT, Circle-3(3), Ahmedabad

ITA 104/AHD/2020

• Counselvise Citation: [2022] 105 COUNSELVISE.COM (IT) 3632 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 2 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-04-2022
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2016-2017
• Appeal Filed On: 28-01-2020
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Unexplained cash credit; Additional evidence
• Section: 68; 142(1); 143(2); 101

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL “SMC” BENCH, AHMEDABAD \ BEFORE SHRI WASEEM AHMED, ACCOUNTANT MEMBER AND SHRI T.R. SENTHIL KUMAR, JUDICIAL MEMBER ITA No. 104/Ahd/2020 Assessment Years : 2016-17 Shaileshbhai Fulchandbhai Jain, E-21, Aakash Tower, Judges Bungalow Road, Bodakdev, Ahmedabad-382054 PAN : AAOPJ 8254 D Vs Assistant Commissioner Of Income-tax, Circle-3(3), Ahmedabad / (Appellant) / (Respondent) Assessee by : Shri P.B. Parmar, AR Revenue by : Shri R.R. Makwana, Sr. DR /Date of Hearing : 21/04/2022 /Date of Pronouncement : 27/04/2022 आदेश/O R D E R PER T.R. SENTHIL KUMAR, JUDICIAL MEMBER : This is an appeal filed by the assessee against the order dated 29.07.2019 passed by the learned Commissioner of Income Tax (Appeals)-3, Ahmedabad (hereinafter referred to as the “CIT(A)”), relating to the Assessment Year 2016-17, with a request to condone the delay of 101 days in filing the above appeal before the Tribunal. 2. In the affidavit filed by the assessee, it is stated that by mistake the appellate order was not brought to the knowledge of the Chartered Accountant in time; therefore, there was a delay of 101 days in filing the present appeal before the Tribunal. The learned Departmental Representative appearing for the Revenue has no serious objection in condoning the above delay. Therefore, we condone the delay in filing the appeal before the Tribunal and take up the appeal for hearing. 3. The brief facts of the case are that the assessee is an individual engaged in the business of trading of furnace oil, fuel oil and bitumen in the name and style of Subhi Impex. The assessee is also IITA No. 104/Ahd/2020 Shaileshbhai Fulchandbhai Jain Vs. ACIT AY : 2016-17 2 having income from other sources as also has agricultural income. For Assessment Year 2016-17, the assessee has filed his return of income on 10.01.2017 declaring total income of Rs.4,18,580/-. The assessee’s case was selected for limited scrutiny assessment and notice under Section 143(2) of the Income-tax Act, 1961 (hereinafter referred to as the “Act”) was issued. As there was no response from the assessee, notices under Section 142(1) of the Act dated 11.07.2018, 21.08.2018, 27.09.2018 and 13.10.2018 were issued to the assessee. The assessee has made cash deposits between 03.04.2015 to 01.11.2015 for a sum of Rs.23,90,000/-. The assessee vide letter dated 02.11.2018 submitted before the Assessing Officer that, during the financial year, Rs.23,90,000/- has been received by the assessee out of agriculture income and the agriculture expenses of Rs.7,17,000/- was incurred. Therefore, the net agricultural income of Rs.16,73,000/- has been declared by the assessee in the return of income for rate purpose. Vide another letter dated 26.11.2018, the assessee furnished ledger account of agriculture account and expenditure account; however, the assessee has not submitted any evidence regarding the receipt of agricultural income such as sale bill of agricultural produce. Therefore, the Assessing Officer issued a show-cause notice dated 05.12.2018 to furnish the documentary evidences in respect of cash receipt for sale of agricultural produce on or before 07.12.2018. The assessee was also given another opportunity to furnish the details before 10.12.2018; however, the assessee failed to furnish any such evidence before the Assessing Officer. In the above circumstances, the Assessing Officer treated the cash deposited in the bank account amounting to Rs.23,90,000/- as unexplained cash credit under Section 68 of the Act and added the same to the total income of the assessee. The Assessing Officer also calculated the tax on IITA No. 104/Ahd/2020 Shaileshbhai Fulchandbhai Jain Vs. ACIT AY : 2016-17 3 Rs.23,90,000/- under Section 115BBE of the Act and initiated the penalty proceedings accordingly. 4. Aggrieved by the assessment order, the assessee filed an appeal before the learned CIT(A). The findings recorded by the learned CIT(A) in his impugned order are as follows:- “2.5 I have considered the facts of the case. The appellant has tried to explain cash deposit of Rs.23,90,000/- through agricultural income. The appellant has also placed on record proof of land holding, copy of Forms 7/12 and Income Tax return filed disclosing agriculture income for different years. The appellant also submitted the details regarding agriculture income during assessment proceedings. Further, the appellant submitted the agriculture income declared in the return of income from A.Y.2014-15 to A.Y. 2015-16 during assessment proceedings and copies have been placed on record. The same are as under- AY 2014-15 Rs.7,20,100/- A Y 2015-16 Rs. 4,24,620/- The AO has accepted in earlier years that the appellant is having agricultural land and assessee has filed copy of Form 8A and 7/12., The assessing officer was not satisfied about the income generated from the above land in the year under appeal as this income is far excess as compared to earlier years and there is no proof of any windfall (which is highly improbable) in agricultural produce. It is seen that in the previous years the agricultural income for assessment year 2014-15, 2015-16 is around 4-7 lakhs but during this year the appellant has shown agricultural income of Rs.23,90,000/- which has been deposited in the bank as cash, the explanation of the assessee cannot be fully accepted for the reason as discussed above. In view of the above, as it is a fact that assessee is having agricultural land and from that he is generating agricultural income to the extent of Rs.5.6 lakhs (average) every year, the amount to this extent can be accepted for this year also as agricultural income which is generated in cash. Therefore, the cash deposit in the form of agricultural income of Rs.18,30,000/- (23,90,000/- - 5,60,000/-) is confirmed as undisclosed unexplained credit u/s. 68 of the Act which has become undisclosed income of the assessee for the year. The assessee gets relief of Rs.5,60,000/-. Accordingly, the appeal of the assessee is partly allowed. ” 5. Aggrieved against the order of the learned CIT(A), the assessee is in appeal before this Tribunal, raising the effective solitary ground viz. the CIT(A) has erred in law in confirming addition of IITA No. 104/Ahd/2020 Shaileshbhai Fulchandbhai Jain Vs. ACIT AY : 2016-17 4 Rs.18,30,000/- as unexplained cash credits u/s 68 r.w.s. 115BBE of the Act, which is nothing but the agricultural income. Further by way of ground No.2, the assessee has pleaded that, “both the lower authorities have passed the orders without properly appreciating the facts and they further erred in grossly ignoring various submissions, explanations and information submitted by the assessee from time to time which ought to have been considered before passing the impugned order and the action of the lower authorities is in clear breach of law and principles of natural justice and therefore deserves to be quashed”. 6. Apart from above, the assessee has also filed an application for admission of additional evidences for the first time before the Tribunal alongwith copy of agricultural sales bills in page nos. 1-11 and copy of bank book and relevant extract of bank statements from page Nos. 12 to 35. The learned AR appearing for the assessee has pleaded that these documents have not been furnished before the learned Assessing Officer and all these documents being the new documents, the same be admitted and send it back to the Assessing Officer for verification and passing appropriate orders. 7. Per contra, the learned DR appearing for the Revenue brought our notice the fact that inspite of seven opportunities given to the assessee – that too with specific show-cause notice, the assessee has not furnished the required details before the Assessing Officer. The learned DR also submitted that even at the time of appellate proceedings before the learned CIT(A), the same were not produced by the assessee and no specific reason for not producing the same before the lower authorities has been properly explained by the assessee. He accordingly submitted that the Tribunal may take appropriate view in the case of the assessee in the circumstances narrated above. IITA No. 104/Ahd/2020 Shaileshbhai Fulchandbhai Jain Vs. ACIT AY : 2016-17 5 8. We have gone through the materials available on record and given our thoughtful consideration. As rightly stated by the learned DR, the assessee was given ample opportunities by the Assessing Officer; however, the assessee has not produced relevant details, documents, bills and bank statements before the Assessing Officer. The case of the assessee is that it is holding agricultural land and also showing agricultural income for AYs 2014-15 to 2018-19, i.e. two years prior to the present AY 2016-17 and also two preceding assessment years to the present AY 2016-17. The assessee has given no reason as to why he could not able to produce the basic documents required by the Assessing Officer for allowing the claim of agricultural income by the assessee. It was, in the above circumstances, the learned CIT(A) has held that the agricultural income for the AYs 2014-15 to 2015-16 is around Rs.4 to 7 lakhs, but during this AY 2016-17 the assessee has shown agricultural income of Rs.23,90,000/-. The assessee has not explained how this much boom in the agricultural income and nature of crop cultivated by him. In the absence of any details furnished by the assessee, the learned CIT(A) estimated the average agricultural income as Rs.5.6 lakhs which is reasonably allowable and he accordingly confirmed the remaining Rs.18.3 lakhs as the unexplained credit under Section 68 of the Act. 9. We can also observe in the assessee’s case that the assessee is non-cooperative with the Assessing Officer in spite of seven opportunities given to him by the Assessing Officer. The assessee has also not furnished the bills, bank statements even before the learned CIT(A) in spite of enough opportunities given by the learned CIT(A). Further, the present appeal is filed before the Tribunal with a delay of 101 days; so, taking into account the overall lethargic attitude of the assessee, we deem it fit to impose a cost of IITA No. 104/Ahd/2020 Shaileshbhai Fulchandbhai Jain Vs. ACIT AY : 2016-17 6 Rs.10,000/- on the assessee payable to the Prime Minister’s National Relief Fund within a period of four weeks from the date of receipt of this order. Thereafter, on production of the official receipt, the learned Assessing Officer can entertain the additional evidences placed before the Tribunal and, after affording opportunity to the assessee, the learned Assessing Officer is directed to pass appropriate assessment order in accordance with law. To this extent, this appeal of the assessee is allowed. 10. In the result, the appeal filed by the assessee is allowed for statistical purposes. Order pronounced in the open Court on 27 th April, 2022 at Ahmedabad. Sd/- Sd/- (WASEEM AHMED) (T.R. SENTHIL KUMAR) ACCOUNTNAT MEMBER JUDICIAL MEMBER Ahmedabad, Dated 27/04/2022 *Bt /Copy of the Order forwarded to : 1. ! / The Appellant 2. "# ! / The Respondent. 3. $%$&' # # ( / Concerned CIT 4. # # ( ) (/ The CIT(A)- 5. + , # &' , # # &' /DR,ITAT, Ahmedabad, 6. , ./ 0 /Guard file. / BY ORDER, TRUE COPY ह # $ज (Asstt. Registrar) # # &' ITAT, Ahmedabad 1. Date of dictation- ...22.04.2022...... 2. Date on which the typed draft is placed before the Dictating Member ...22.04.2022 ......... Other member....26.04.2022 .......... 3. Date on which the approved draft comes to the Sr.P.S./P.S. - ...26.04.2022 ............... 4. Date on which the fair order is placed before the Dictating Member for Pronouncement ...27.04.2022 5. Date on which the file goes to the Bench Clerk....27.04.2022............... 6. Date on which the file goes to the Head Clerk.................................. 7. The date on which the file goes to the Assistant Registrar for signature on the order......... 8. Date of Despatch of the Order..................