SHRI VIRENDER KUMAR, ALWAR V. INCOME TAX OFFICER, WARD-1-1, ALWAR

ITA 1100/JPR/2019

• Counselvise Citation: [2021] 108 COUNSELVISE.COM (IT) 9089 (ITAT-JAIPUR)
• Duration Of Justice: 1 year(s) 6 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-03-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2011-2012
• Appeal Filed On: 09-09-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: O P BHATEJA ITP
• Keywords: Business income; Competent authority
• Section: 44AD; 148

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENC HES, JAIPUR JH LAANHI XKSLKBZ] U;KF;D LNL; ,OA JH FOE FLAG ;KNO] YS[KK LNL; DS LE{K BEFORE: SHRI SANDEEP GOSAIN, JM & SHRI VIKRAM SING H YADAV, AM VK;DJ VIHY LA- @ ITA NO. 1100/JP/2019 FU/KZKJ.K O'K Z @ ASSESSMENT YEAR :2011-12 SH. VIRENDER KUMAR, PROP. MOHAN DAIRY, NEAR SAINI ICE FACTORY, ALWAR ROAD, ALWAR CUKE VS. ITO, WARD-1(1), ALWAR LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO. BTMPK7385L VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT FU/KZKFJRH DH VKSJ L S@ ASSESSEE BY : SH. O. P. BHATEJA (ITP) JKTLO DH VKSJ LS @ REVENUE BY : SMT. MONISHA CHOUDHARY (ADDL.CIT) LQUOKBZ DH RKJH[ K@ DATE OF HEARING : 15/12/2020 MN?KKS'K.KK DH RKJH[ K@ DATE OF PRONOUNCEMENT: /03/2021 VKNS'K@ ORDER PER: VIKRAM SINGH YADAV, A.M. THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER OF LD. CIT(A)-22, ALWAR DATED 24.06.2019 RELEVANT FOR A.Y 2011-12 WHEREIN HE HAS CONFIRMED THE ADDITION MADE BY THE ASSESSING OF FICER AMOUNTING TO RS. 11,38,000/- AS UNEXPLAINED DEPOSITS IN THE BANK ACCOUNT MAINTAINED BY THE ASSESSEE. 2. BRIEFLY STATED, THE FACTS OF THE CASE ARE THAT THE ASSESSEE IS PROPRIETOR OF MOHAN DAIRY, TIJARA, ALWAR AND IS IN DIARY BUSINESS. AS PER ITS DETAILS AVAILABLE WITH THE DEPARTMENT, IT WAS F OUND THAT THE ASSESSEE HAD MADE CASH DEPOSIT OF RS. 4,00,000/- DURING THE F.Y 2010-11 RELEVANT ITA NO. 1100/JP/2019 SH. VIRENDER KUMAR, ALWAR VS. ITO, ALWAR 2 TO A.Y 2011-12. GIVEN THAT THE ASSESSEE HAS NOT FIL ED HIS RETURN OF INCOME, THE ASSESSING OFFICER RECORDED THE REASONS FOR REOP ENING STATING THAT THE ASSESSEES INCOME TO THE EXTENT OF RS. 4,00,000/- H AS ESCAPED ASSESSMENT AND NOTICE U/S 148 WAS ISSUED AFTER SEEKING APPROVA L FROM THE COMPETENT AUTHORITY. IN RESPONSE, THE ASSESSEE FILED HIS RET URN OF INCOME DECLARING GROSS RECEIPTS OF RS. 14,56,230/- FROM HIS DAIRY BU SINESS AND DECLARED 9.28% OF GROSS RECEIPT AS INCOME AS PER PROVISIONS OF SECTION 44AD OF THE ACT. BESIDES INTEREST FROM BANK AND OTHER MISCELLAN EOUS INCOME AMOUNTING TO RS. 18,138/- WAS ALSO DECLARED AND THE ASSESSEE DECLARED TOTAL INCOME TO THE TUNE OF RS. 1,53,300/- WHICH WA S ACCEPTED BY THE ASSESSING OFFICER. AT THE SAME TIME, THE ASSESSING OFFICER MADE AN ADDITION OF RS. 4,98,000/- TOWARDS CASH DEPOSITS AN D RS. 6,40,000/- TOWARDS CREDITS IN THE BANK ACCOUNT MAINTAINED BY T HE ASSESSEE WHICH ON APPEAL HAS BEEN CONFIRMED BY THE LD CIT(A) AND HENC E, THE PRESENT APPEAL. 3. DURING THE COURSE OF HEARING, THE LD. AR SUBMIT TED THAT SOURCE OF CASH AND OTHER DEPOSITS IN THE BANK ACCOUNT IS OUT OF ASSESSEES DAIRY BUSINESS AND THE ASSESSING OFFICER HAS NOT BROUGHT ON RECORD ANY SOURCE OF INCOME OTHER THAN THE DAILY BUSINESS WHICH WAS C ARRIED ON BY THE ASSESSEE. IT WAS SUBMITTED THAT ONCE THE RETURN OF INCOME DISCLOSING GROSS RECEIPTS OF RS. 14,56,230/- FROM DAIRY BUSINE SS HAS BEEN ACCEPTED AS PER PROVISIONS OF SECTION 44AD OF THE ACT, NO SE PARATE ADDITION CAN BE MADE ON THE BASIS OF BANK DEPOSITS ESPECIALLY WHERE THE CREDITS MADE IN THE BANK ACCOUNT IS LESS THAN GROSS RECEIPTS DECLAR ED IN THE RETURN OF INCOME. IN SUPPORT, THE RELIANCE WAS PLACED ON THE DECISION OF THE HONBLE PUNJAB AND HARYANA HIGH COURT IN CASE OF CIT V. SUR INDER PAL ANAND (IN ITA NO. 156 OF 2010 DATED 29 TH JUNE, 2010) AND THE DECISION OF THE CO- ORDINATE BENCHES IN CASE OF NAND LAL POPLI V. DCIT (ITA NO. 1161, ITA NO. 1100/JP/2019 SH. VIRENDER KUMAR, ALWAR VS. ITO, ALWAR 3 1162/CHD/2013 DATED 14.06.2016) AND SH. THOMAS EAPEN V. ITO (ITA NO. 451/COCH/2019 DATED 15.11.2019). 4. PER CONTRA, THE LD. DR SUBMITTED THAT IT IS NOT DISPUTED THAT THE ASSESSEE HAS DECLARED GROSS RECEIPTS OF RS. 14,56,2 30/- FROM HIS DAIRY BUSINESS AND RETURN OF INCOME HAS BEEN FILED U/S 44 AD OF THE ACT. HOWEVER, DURING THE COURSE OF ASSESSMENT PROCEEDING S, THE ASSESSEE WAS REQUIRED TO FILE DOCUMENTARY EVIDENCE TO SUBSTANTIA TE HIS CLAIM REGARDING DIARY BUSINESS AND IN ABSENCE OF ANY SUCH EVIDENCE FURNISHED BEFORE THE ASSESSING OFFICER, IT WAS NOT POSSIBLE TO VERIFY TH AT THE RECEIPT SO DECLARED AMOUNTING TO RS. 14,56,230/- IS FROM THE BUSINESS O F DAIRY. THE LD. DR FURTHER SUBMITTED THAT THE AMOUNT OF CASH AND OTHER CREDITS IN THE BANK ACCOUNT REMAIN UNVERIFIED AS THE ASSESSEE HAS NOT F ILED ANY REPLY REGARDING THE SOURCE OF SUCH DEPOSITS AND THE ADDIT IONS WERE ACCORDINGLY MADE BY THE AO WHICH WERE RIGHTLY CONFIRMED BY THE LD CIT(A). SHE THUS RELIED ON THE FINDING OF THE LOWER AUTHORITIES. 5. WE HAVE HEARD THE RIVAL CONTENTIONS AND PURUSED THE MATERIAL AVAILABLE ON RECORD. IT IS NOTED THAT THE ASSESSEE IS IN THE DIARY BUSINESS IN THE NAME AND STYLE OF M/S MOHAN DIARY, TIJARA AN D IN PURSUANT TO NOTICE U/S 148, HE HAS FILED HIS RETURN OF INCOME U/S 44AD DECLARING GROSS RECEIPTS FROM HIS DIARY BUSINESS AMOUNTING TO RS 14 ,56,230/-. THE RETURN SO FILED U/S 44AD HAS BEEN ACCEPTED BY THE ASSESSIN G OFFICER WHICH IN EFFECT MEANS THE DECLARATIONS AND DISCLOSURE SO MAD E BY THE ASSESSEE IN TERMS OF CARRYING ON DIARY BUSINESS, NON-MAINTENANC E OF BOOKS OF ACCOUNTS AND GROSS RECEIPTS FROM SUCH BUSINESS AMOU NTING TO RS 14,56,230/- HAS SINCE BEEN ACCEPTED BY THE ASSES SING OFFICER. IN SUCH A SCENARIO, WHERE THERE ARE CASH AND OTHER CREDITS IN THE BANK ACCOUNT MAINTAINED BY THE ASSESSEE AMOUNTING TO RS 11,38,00 0/- WHICH ARE LESS ITA NO. 1100/JP/2019 SH. VIRENDER KUMAR, ALWAR VS. ITO, ALWAR 4 THAN THE GROSS RECEIPTS FROM DIARY BUSINESS SO DECL ARED BY THE ASSESSEE, WE FIND THE EXPLANATION OFFERED BY THE ASSESSEE THA T SUCH DEPOSITS ARE FROM HIS DIARY BUSINESS AS A PLAUSIBLE EXPLANATION IN ABSENCE OF ANYTHING CONTRARY ON RECORD IN TERMS OF ANY OTHER SOURCE OF INCOME. OUR VIEW IS FORTIFIED BY THE DECISION OF THE HONBLE PUNJAB AND HARYANA HIGH COURT DECISION IN CASE OF SURINDER PAL ANAND (SUPRA) WHERE THE HONBLE HIGH COURT WAS PLEASED TO HELD AS UNDER: 5. ONCE UNDER THE SPECIAL PROVISION, EXEMPTION FRO M MAINTAINING OF BOOKS OF ACCOUNT HAS BEEN PROVIDED AND PRESUMPTIVE TAX @ 8% OF THE GROSS RECEIPT ITSELF IS THE BASIS FOR DETERMINING T HE TAXABLE INCOME, THE ASSESSEE WAS NOT UNDER OBLIGATION TO EXPLAIN INDIVI DUAL ENTRY OF CASH DEPOSIT IN THE BANK UNLESS SUCH ENTRY HAD NO NEXUS WITH THE GROSS RECEIPTS. THE STAND OF THE ASSESSEE BEFORE COMMISSI ONER OF INCOME-TAX (APPEAL) AND THE ITAT THAT THE SAID AMOUNT OF RS. 1 4,95,300/- WAS ON ACCOUNT OF BUSINESS RECEIPTS HAD BEEN ACCEPTED. LEA RNED COUNSEL FOR THE APPELLANT WITH REFERENCE TO ANY MATERIAL ON RECORD, COULD NOT SHOW THAT THE CASH DEPOSITS AMOUNTING TO RS. 14,95,300/- WERE UNEXPLAINED OR UNDISCLOSED INCOME OF THE ASSESSEE. 6. WE THEREFORE FIND FORCE IN THE CONTENTION SO ADV ANCED BY THE LD AR THAT THE SOURCE OF CASH AND OTHER DEPOSITS IN THE B ANK ACCOUNT IS OUT OF ASSESSEES DAIRY BUSINESS AND GROSS RECEIPTS THEREO F HAVE ALREADY BEEN OFFERED IN THE RETURN OF INCOME. IN LIGHT OF THE A FORESAID DISCUSSION, THE ADDITION SO MADE BY THE ASSESSING OFFICER IS HEREBY DIRECTED TO BE DELETED. 7. IN VIEW OF OUR DECISION ON MERITS OF THE ADDITIO N MADE BY THE ASSESSING OFFICER, THE OTHER LEGAL GROUNDS RAISED B Y THE ASSESSEE HAVE BECOME INFRUCTUOUS AND HENCE THE SAME HAVE NOT BEEN ADJUDICATED UPON. ITA NO. 1100/JP/2019 SH. VIRENDER KUMAR, ALWAR VS. ITO, ALWAR 5 IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON /03/2021 . LANHI XKSLKBZ FOE FLAG ;KNO ( SANDEEP GOSAIN ) (VIKRAM SINGH YADAV) U;KF;D LNL;@ JUDICIAL MEMBER YS[KK LNL;@ ACCOUNTANT MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- /03/2021 * GANESH KR. VKNS'K DH IZFRFYFI VXZSFKR@ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ@ THE APPELLANT- SH. VIRENDER KUMAR, ALWAR 2. IZR;FKHZ@ THE RESPONDENT- ITO, WARD-1(1), ALWAR 3. VK;DJ VK;QDR@ CIT 4. VK;DJ VK;QDR@ CIT(A) 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ@ DR, ITAT, JAIPUR. 6. XKMZ QKBZY@ GUARD FILE {ITA NO. 1100/JP/2019} VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ@ ASST. REGISTRAR