Govind Mansangbhai Chaudhary, Ahmedabad V. The ITO, Ward-1, Mehsana

ITA 1066/AHD/2019

• Counselvise Citation: [2022] 103 COUNSELVISE.COM (IT) 8677 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 4 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-11-2022
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: SMC
• Next Hearing Date: 18-10-2022
• Assessment Year: 2008-2009
• Appeal Filed On: 24-06-2019
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Income from undisclosed sources; Salary income; TDS
• Section: 148; 250

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL “SMC” BENCH, AHMEDABAD BEFORE MS. SUCHITRA KAMBLE, JUDICIAL MEMBER& I. T .A . N o .1 06 6 / Ah d/2 0 1 9 ( A s se ss m e nt Y e a r : 20 08- 0 9 ) Go vi nd M an sa n g b h a i C h a u dh ar y 12, S au m ya Fl a t s, B / h. Na vr an g Fla ts , C . G . R o a d , N a v ra ng p u r a , Ah me da bad - 3 80 00 9 V s . I T O War d - 1 , Me hs ana [P AN N o.A B OP C 1 83 6 B] (Appellant) .. (Respondent) Appellant by : Shri S. N. Divatia, Advocate Respondent by: Shri Ravindra, Sr. D.R. D a t e of H ea r i ng 19.10.2022 D a t e of P r o no u n ce me nt 11.11.2022 O R D E R PER Ms. SUCHITRA KAMBLE - JM: The appeal filed by the assessee is against the order passed by the Ld. CIT(A), Gandhinagar, Ahmedabad on 07.01.2019 for A.Y. 2008-09. 2. The grounds of appeal raised by the assessee are as under: “1.1 The order passed u/s 250 on 7-1-2019 for A.Y. 2008-09 by CIT(A)-GNR, upholding the addition of Rs.16,63,000/- towards cash deposits as unaccounted income is wholly illegal, unlawful and against the principles. 1.2 That in the facts and circumstances of the case as well as in law, the Ld. CIT (A) erred in not considering fully and properly the evidence produced by the appellant. The Ld. CIT(A) ought to have considered that there was reasonable and sufficient cause for alleged non-compliance in as much as that appellant met with an accident so that he could not comply to the notices. 2.1 That in the facts and circumstances of the case as well as in law, the Ld. CIT (A) has grievously erred in upholding the addition of Rs. 16,63,000/- towards cash deposits as unaccounted income. 2.2 The Ld. CIT(A) has erred ought not to have made addition of Rs. 16,63,000/- towards cash deposits as unaccounted income. 3.1 That addition confirmed by CIT(A) is highly excessive and calls for reduction. That Ld. CIT(A) ought to have restricted the addition to the extent of peak credit. ITA No. 1066/Ahd/2019 Govind Mansangbhai Chaudhary vs. ITO Asst.Years–2008-09 - 2 - It is, therefore, prayed that the order passed by CIT(A) may please be set aside and addition of Rs. 15,21,580/- may be deleted.” 3. The assessee is an individual and as per contention of the Ld. A.R. he derives salary income. The assessee filed return of income on 21.04.2008 declaring his income at Rs. 92,340/-. The assessee deposited cash in his Saving Bank Account as per the AIR information and therefore, the case was re-opened by issuing notice under Section 148 dated 27.03.2015. The assessee did not file his return of income in compliance to the notice under Section 148 of the Act. The assessee filed reply to the notices. During the course of re-assessment proceedings, the Assessing Officer observed that assessee deposited in total 16,63,000/- as cash deposits which cannot be termed as salary income. Therefore, the Assessing Officer made addition of Rs. 16,63,000/- as his undisclosed income. 4. Being aggrieved by the assessment order the assessee filed appeal before the CIT(A). The CIT(A) has dismissed the appeal of the assessee. 5. The Ld. A.R. submitted that the assessee was doing share trading business as well as was director in Excel Health Care Pvt. Ltd. and Ethical Pharma Pvt. Ltd., both the company manufactures medicine. The assessee was generating income by way of remuneration from the company. The Ld. A.R. submitted that during the year under consideration the assessee received gross income of remuneration of Rs. 1,66,280/- out of which deduction of Rs. 73,941/- which claimed under Chapter vi(a) of the Act. The Ld. A.R. submitted that the assessee made withdrawal of unsecured loan lying in the company Excel Health Care Pvt. Ltd. for which the assessee submitted audited balance sheet of the company wherein unsecured ITA No. 1066/Ahd/2019 Govind Mansangbhai Chaudhary vs. ITO Asst.Years–2008-09 - 3 - loan has been reflected. The assessee submitted salary certificate issued by Excel Health Care Pvt. Ltd. for payment of Directors remuneration amounting to Rs. 1,67,000/-. The Ld. A.R. submitted that the Assessing Officer has not carried out any independent enquiry and doubted the genuine return of income without bringing any cogent material on record, hence, the conclusion taken by the Assessing Officer on mere surmises and assumptions bears no legal value and evidence submitted by the assessee. The Ld. A.R. submitted that the CIT(A) has not taken cognizance of the remand report and the cash deposits were from the said unsecured loan shown in the audited balance sheet of the company and the withdrawal of the sale in cash. Thus, the source of the cash deposits as well as the other aspect regarding the cash deposits were explained alongwith evidences and hence the addition may be deleted. 6. The Ld. D.R. submitted that the assessee and the company has active account in Axis Bank and the assessee’s claim regarding unsecured loan obtain from friends and relatives is not supported with any evidences as such. 7. The Ld. D.R. relied upon the assessment order and the order of the CIT(A). 8. Heard both the parties and perused all the relevant material available on record. It is pertinent to note that the assessee has only submitted before the authorities that the assessee made withdrawal of unsecured loan lying in the company Excel Health Care Pvt. Ltd. but the assessee never explained as to the ledger of loan given or taken alongwith rate of interest charge/paid ITA No. 1066/Ahd/2019 Govind Mansangbhai Chaudhary vs. ITO Asst.Years–2008-09 - 4 - alongwith details TDS deducted and documentary evidences. The assessee did not explain the relationship of the persons such as friends and relatives while deducting loan which was deposited in Axis Bank. In fact, M/s. Excel Health Care Pvt. Ltd. were also asked the details but it clearly stated that no interest has been paid to the assessee in F.Y. 2007-08 and company did not made any transaction with the assessee in cash except the transaction entered into F.Y. 2007-08. Thus, from the perusal of the records it can be seen that the assessee has not given the evidence related to cash deposits before the Assessing Officer as well as before the CIT(A) and the explanation by the assessee during the assessment proceedings as well as during the appellate proceedings were inadequate. The ledger account of Excel Health Care Pvt. Ltd. is inadequate to show as to why the cash deposits have been made by the assessee. Hence, the appeal of the assessee is dismissed. 9. In result, the appeal of the assessee is dismissed. This Order pronounced in Open Court on 11/11/2022 Sd/- (SUCHITRA KAMBLE) JUDICIAL MEMBER Ahmedabad; Dated 11/11/2022 TANMAY, Sr. PS TRUE COPY आदेश क त ल प अ े षत/Copy of the Order forwarded to : 1. अपीलाथ / The Appellant 2. यथ / The Respondent. 3. संबं धत आयकर आय ु त / Concerned CIT 4. आयकर आय ु त(अपील) / The CIT(A)- 5. वभागीय त न ध, आयकर अपील!य अ धकरण, अहमदाबाद / DR, ITAT, Ahmedabad 6. गाड' फाईल / Guard file. आदेशान ु सार/ BY ORDER, उप/सहायक पंजीकार (Dy./Asstt.Registrar) आयकर अपील य अ धकरण, अहमदाबाद / ITAT, Ahmedabad