Sh. Daud Ahmed, Chandigarh V. ITO, Chandigarh

ITA 1123/CHANDI/2016

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 5372 (ITAT-CHANDIGARH)
• Duration Of Justice: 1 year(s) 2 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-01-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2009-2010
• Appeal Filed On: 04-11-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MANJIT SINGH
• Assessee Lawyers: DAUD AHMED
• Keywords: Unexplained cash credit
• Section: 142(1); 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL CHANDIGARH BENCHES, SMC, CHANDIGARH BEFORE MS. DIVA SINGH, JUDICIAL MEMBER ITA NO. 1123/CHD/2016 ASSESSMENT YE AR: 2009-10 SHRI DAUD AHMED, VS. THE ITO, # 368, BAPU DHAM COLONY, WARD 5(1), SECTOR 26, CHANDIGARH. CHANDIGARH. PAN NO. AHPPA0308K (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI DAUD AHMED (ASSESSEE) RESPONDENT BY : SHRI MANJIT SINGH, SR.DR DATE OF HEARING : 14.12.2017 DATE OF PRONOUNCEMENT : 05.01.2018 ORDER THE PRESENT APPEAL HAS BEEN FILED BY THE ASSESSEE ASSAILIN G THE CORRECTNESS OF THE ORDER DATED 22/08/2016 OF CIT(A)-2 CHANDIGARH PERTAINING TO 200910 ASSESSMENT YEAR ON THE FOLLOWING GROUNDS : 1. THAT THE IMPUGNED ORDER IS AGAINST FACTS AND LA W . 2. THAT THE WORTHY CIT(A) HAS ERRED IN CON FIRMING THE ADDITION OF RS. 14/58,500/- BY WRONGLY TREATING THE GENUINE BUSINES S RECEIPTS DEPOSIT IN ONE BANK AS AN UNEXPLAINED CASH CREDIT. 3. THAT THE WORTHY CIT(A) HAS ERRED IN CONFIRMI NG THE ADDITION OF RS. 14,58/500/- AS UNEXPLAINED CASH DEPOSIT WITHOUT A PPRECIATING THE FACTS IN CORRECT PERSPECTIVE AND IGNORING ALL SUBMI SSIONS MADE BEFORE HIM. THEREFORE, THE IMPUGNED ORDER IS NOT ONLY ILLE GAL BUT IT IS ALSO NOT JUST AND FAIR AND IT IS CONTRADICTORY TO SETTLED LA W. 2. AT THE TIME OF HEARING AN ADJOURNMENT APPLICATION WAS PLACED ON BEHALF OF THE LD. AR SEEKING TIME. SINCE THE PRESENT APPEAL COULD BE DECIDED ON THE BASIS OF MATERIAL AVAILABLE ON RECORD AND THE ASSESSEE WA S PRESENT IN PERSON IN SUPPORT OF THE APPLICATION, IT WAS DEEMED APPROPRIATE T O REJECT THE APPLICATION AND DECIDE THE APPEAL AFTER HEARING THE SUBMISS IONS OF THE PARTIES. 3. THE LD. SENIOR DR RELIED UPON THE CONSISTENT ORDERS O F THE AUTHORITIES BELOW. 4. THE RELEVANT FACTS OF THE CASE ARE THAT THE ASSESS EE DECLARED AN INCOME OF RS. 1,40,650/- WHICH WAS PROCESSED UNDER SECTION 143 ( 1). SUBSEQUENTLY THE SAID RETURN WAS PICKED UP FOR SCRUTINY THROUGH CASS IN VIEW OF THE FACT ITA 1123/CHD/2016 A.Y. 2009-10 PAGE PAGE 2 OF 3 THAT THERE WAS A DEPOSIT FOUND IN THE SAVING BANK OF THE ASSESSEE. THE AO REQUISITIONED AND OBTAINED FROM THE BRANCH MANAGER, STATE BANK OF INDIA, SECTOR-7, CHANDIGARH THE STATEMENT OF SAVING BANK ACCOU NT NUMBER 30232397306MAINTAINED WITH THE STATE BANK OF INDIA SECTO R7, CHANDIGARH WHEREIN THE DEPOSITS OF CASH AMOUNT OF RS. 14,58,500. THE ASSESSEE, AS PER RECORD, WAS STATED TO BE ENGAGED IN THE BUSINESS OF COM MISSION AGENT ON PURCHASE AND SALE OF FRUITS AND EARNED HANDLING CHARGES O N SALE OF FRUITS TO VARIOUS PARTIES SCATTERED ALL AROUND THE COUNTRY. IN RE SPONSE TO NOTICES U/S 142(1) & 143(2) ISSUED TO HIM, THE COUNSEL OF THE ASSESSEE FU RNISHED STATEMENT OF BANK A/C NO. 3249002100029370 MAINTAINED W ITH PUNJAB NATIONAL BANK, SECTOR 26, CHANDIGARH, COPIES OF BALANCE SHEE T, PROFIT & LOSS ACCOUNT HANDLING CHARGES (MONTH-WISE), HANDING CHARGES (PA RTY-WISE) LEDGER ACCOUNTS OF THE PARTIES FROM WHOM INCOME ON ACCOUNT OF H ANDLING CHARGES HAS BEEN EARNED. THE ASSESSEE WAS GRANTED VARIOUS OP PORTUNITIES TO EXPLAIN THE DEPOSITS IN CASH AND FURNISH INFORMATION IN REGARD THER ETO, HOWEVER, THE ASSESSEE FAILED TO OFFER ANY EXPLANATION LEADING TO THE PAS SING OF THE ORDER UNDER SECTION 144 OF THE INCOME TAX ACT, 1961 BY THE AO. 5. THE SAID ORDER WAS CHALLENGED IN APPEAL BEFORE THE 1 ST APPELLATE AUTHORITY. ON BEHALF THE ASSESSEE AS PER SUBMISSIONS REC ORDED IN PARA 6.2, IT HAS BEEN ARGUED THAT IN THE COURSE OF THE ASSESSMENT PROCEEDINGS, THE AO HAS ACCEPTED THE EXPLANATION. DESPITE THIS THE AO HAS TR EATED THE DEPOSITS IN STATE BANK OF INDIA ACCOUNT NO. 302323973606AS UNEXPLAIN ED CASH. IT WAS STATED THAT CASH IN THIS ACCOUNT HAS BEEN DEPOSITED BY DIFFERENT PERSONS FROM DIFFERENT PARTS OF THE COUNTRY FOR SALE OF FRUITS. THE SAID E VIDENCE, ADMITTEDLY, WAS SENT TO THE AO AS IS EVIDENT FROM THE REMAND REPOR T OF THE AO EXTRACTED IN PARA 6.3 OF THE IMPUGNED ORDER. HOWEVER, IN THE ABSENCE OF ANY JUSTIFICATION WHY CASH SHOULD BE DEPOSITED BY VARIOUS PERS ONS AS COST OF FRUITS AND THE ASSESSEE DESPITE OPPORTUNITY, FAILED TO FURNISH ANY EXPLANATION OR THE NAMES AND ADDRESSES OF THE PERSONS WHO ARE STATED TO HAVE DEPOSITED CASH IN THE SPECIFIC BANK ACCOUNT, THE ADDITION WAS CONFIRMED. 6. THE ASSESSEE, PRESENT IN PERSON SUBMITTED THAT THE PERSONS WHO DEPOSITED CASH IN HIS BANK ACCOUNT ARE NOT PERSONALLY K NOWN TO HIM. HOWEVER, BASED ON HIS REPUTATION IN THE MARKET WHERE HE AS THE FRUIT VENDOR HAS AN IMMOVABLE STALL REHRI ALWAYS AT A SPECIFIC PLACE AN D PEOPLE HAD COME TO HIM AND ASKED HIM TO HELP THEM IN THE PURCHASE OF FRU ITS. THESE UNKNOWN PEOPLE HAVE DEPOSITED THE AMOUNTS FOR THE SAID PURPOSE IN HIS BANK ACCOUNT. ITA 1123/CHD/2016 A.Y. 2009-10 PAGE PAGE 3 OF 3 IT WAS ALSO CLARIFIED BY HIM THAT HE HAS SUBSEQUENTLY STO PPED HELPING OUT PEOPLE IN SUCH A MANNER AND HENCEFORTH HAS NOT ALLOWED A NYONE TO DEPOSIT CASH AMOUNTS IN HIS BANK ACCOUNT. CONSIDERING THE PAPER BOOK FILED ON BEHALF OF THE ASSESSEE WHICH CONSISTS OF PRINT OUTS OF STA TEMENTS OF THE 2 SPECIFIC BANK ACCOUNTS MAINTAINED BY THE ASSESSEE, ADMITTE DLY, THE EVIDENCE CANNOT BE SAID TO BE SUFFICIENT AND COMPLETE TO EXPLAIN THE DEPOSITS AS THE ADDITION HAS BEEN MADE ON THE BASIS OF THESE DEPOSITS W HICH REMAIN UNEXPLAINED. THE EVIDENCE WAS ALWAYS AVAILABLE WITH THE TAX AU THORITIES AND IT IS EXPLANATION QUA THESE WHICH HAS ALWAYS BEEN SOUGHT. A CCORDINGLY, IN THE INTERESTS OF JUSTICE, THE IMPUGNED ORDER IS SET ASIDE BACK TO THE FILE OF CIT(A). THE ASSESSEE IN ITS OWN INTERESTS IS ADVISED TO FILE AN AFFID AVIT EXPLAINING CORRECT AND TRUE STATE OF AFFAIRS IN REGARD TO THE DEPOS ITS IN HIS BANK ACCOUNT BY UNKNOWN PEOPLE ADMITTEDLY, FROM DIFFERENT PARTS OF THE COUNTRY AS PER THE VERSION OF THE ASSESSEE ITSELF. WHETHER THE SAID VERSION IS CORRECT OR NOT IS LEFT OPEN TO THE CIT(A) TO CONSIDER ON MERITS. THE ASSESSEE WOULD BE AT LIBERTY TO PLACE ANY FRESH EVIDENCE IT SEEKS TO BRING ON RECORD IN SUPPORT OF ITS CLAIM THAT THE CASH DEPOSITS WERE IN RELATION TO THE BUSINESS WHICH INCOME STOOD ASSESSED. THE SAID ORDER WAS PRONOUNCED IN THE OPEN CO URT IN THE PRESENCE OF THE PARTIES 7. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 05.01.2018. SD/- (DIVA SINGH) JUDICIAL MEMBER POONAM COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT 4. THE CIT(A) 5. THE DR ASSTT. REGISTRAR ITAT,CHANDIGARH.