ITO Ward 9(3), Pune V. Nahar Anil Shrimal, Pune

ITA 1204/PUN/2010

• Counselvise Citation: [2012] 119 COUNSELVISE.COM (IT) 9694 (ITAT-PUNE)
• Duration Of Justice: 2 year(s) 14 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-09-2012
• Appeal Filed By: Department
• Order Result: Partly Allowed
• Bench Allotted: A
• Next Hearing Date: 28-08-2012
• Assessment Year: 2005-2006
• Appeal Filed On: 03-09-2010
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: ANN KAPTHUAMA
• Keywords: Unexplained investment; Depreciation
• Section: 68; 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH A PUNE BEFORE SHRI G.S. PANNU, ACCOUNTANT MEMBER AND SHRI R.S. PADVEKAR, JUDICIAL MEMBER I.T.A. NO. 1204/PN/2010: A.Y. 2005-06 I.T.O. WARD 9(3) PUNE APPELLANT VS. SHRI NAHAR ANIL SHRIMAL, AJINKYA PLOT NO. 27A, NIGDI PRADHIKARAN PUNE-411 044 PAN AANPN 0395 C RESPONDENT I.T.A. NO. 1093/PN/2010: A.Y. 2005-06 NAHAR ANIL SHRIMAL, AJINKYA PLOT NO. 27A, NIGDI PRADHIKARAN PUNE-411 044 PAN AANPN 0395 C APPELLANT VS. I.T.O. WARD 9(3) PUNE RESPONDENT ASSESSEE BY: SHRI KISHOR PHADKE DEPARTMENT BY : MS. ANN KAPTHUAMA ORDER PER G.S. PANNU, AM THESE CROSS APPEALS BY THE REVENUE AS WELL AS BY TH E ASSESSEE ARE DIRECTED AGAINST THE ORDER OF THE COMMISSIONER OF I NCOME-TAX (APPEALS) V PUNE, WHICH, IN TURN HAS ARISEN FROM AN ORDER PASSE D BY THE I.T.O. WARD 9(3) PUNE U/S 144 OF THE INCOME-TAX ACT, 1961 (IN S HORT THE ACT) DATED 24-12-2007 PERTAINING TO THE ASSESSMENT YEAR 2005-0 6. 2. BEFORE WE TAKE UP THE RESPECTIVE GROUNDS IN THES E CROSS APPEALS, IT WOULD BE APPROPRIATE TO BRIEFLY NARRATE THE BACKGRO UND OF THE CASE. THE ASSESSEE IS AN INDIVIDUAL ENGAGED IN THE BUSINESS O F CONSTRUCTION. HE FILED A RETURN OF INCOME DECLARING TOTAL INCOME OF RS. 2,03,520/- WHICH WAS TAKEN UP FOR SCRUTINY ASSESSMENT. IN THE ASSESSMEN T ORDER, THE ASSESSING OFFICER HAS BROUGHT OUT THAT THE ASSESSEE DID NOT RESPOND TO VARIOUS NOTICES ISSUED. THEREFORE, THE ASSESSMENT W AS COMPLETED BY THE PAGE 2 OF 10 ITA NO. 1204 AND 1093/PN/2010 NAHAR ANIL KUMAR A.Y. 2005-06 ASSESSING OFFICER INVOKING SECTION 144 OF THE ACT T O THE BEST OF HIS JUDGMENT. ACCORDINGLY, THE TOTAL INCOME WAS DETERM INED AT RS. 38,97,280/- AS AGAINST THE RETURNED INCOME OF RS. 2 ,03,520/- AFTER MAKING VARIOUS DISALLOWANCES. THE ASSESSEE CARRIED THE MA TTER IN APPEAL BEFORE CIT(A) WHO HAS ALLOWED PART RELIEF AGAINST WHICH TH E REVENUE IS IN APPEAL WHILE THE ASSESSEE IS IN APPEAL WITH RESPECT TO SOM E OF THE ADDITIONS SUSTAINED BY THE CIT(A). 3. IN THIS BACKGROUND, NOW WE WILL TAKE UP THE APPE AL OF THE REVENUE. THE FIRST ISSUE IN THIS APPEAL RELATES TO ADDITION OF RS. 14,50,000/- MADE BY THE ASSESSING OFFICER ON ACCOUNT OF UNSECURED LO ANS. THE ASSESSING OFFICER NOTICED THAT IN THE ABSENCE OF ANY DETAILS HAVING BEEN FURNISHED BY THE ASSESSEE, THE AFORESAID AMOUNT WAS TREATED A S UNEXPLAINED. IN APPEAL BEFORE THE CIT(A), THE ASSESSEE FURNISHED CO NFIRMATION FROM ALL THE LENDERS AND ALSO EXPLAINED THE REASONS AS TO WHY SU CH CONFIRMATIONS COULD NOT BE FURNISHED DURING THE COURSE OF ASSESSM ENT PROCEEDINGS BEFORE THE ASSESSING OFFICER. THE ASSESSEE ALSO CAN VASSED THAT MAJORITY OF THE LOANS WERE RECEIVED BY ACCOUNT PAYEE CHEQUES . THE CIT(A) CALLED FOR A REMAND REPORT FROM THE ASSESSING OFFICER AND AFTER CONSIDERING THE REMAND REPORT AS WELL AS THE DETAILS ALONG WITH THE CONFIRMATIONS FURNISHED BY THE ASSESSEE, HE HAS OBSERVED THAT THE AMOUNT OF UNSECURED LOANS IN QUESTION STOOD EXPLAINED AND ACCORDINGLY D ELETED THE ADDITION OF RS. 14,50,000/-. AGAINST SUCH ACTION OF THE CIT(A), REVENUE IS IN APPEAL BEFORE US. 4. BEFORE US, THE ONLY POINT MADE OUT BY THE LEARNE D DR IS TO THE EFFECT THAT THE REQUISITE CONFIRMATIONS WERE NOT FURNISHED BEFORE THE ASSESSING OFFICER DURING THE ASSESSMENT PROCEEDINGS. HOWEVER, IN OUR VIEW THE AFORESAID OBJECTION OF THE DEPARTMENT IS NOT POTENT TO DISLODGE THE FINDING RECORDED BY THE CIT(A). AS PER THE CIT(A) THE CONF IRMATIONS FROM THE PARTIES BROUGHT ON RECORD BY THE ASSESSEE EXPLAINED THE CREDITS IN PAGE 3 OF 10 ITA NO. 1204 AND 1093/PN/2010 NAHAR ANIL KUMAR A.Y. 2005-06 QUESTION. MOREOVER, IT IS ALSO APPARENT THAT THE M ATERIAL RELIED UPON BY THE CIT(A) TO DELETE THE ADDITION WAS SENT BY THE C IT(A) TO THE ASSESSING OFFICER FOR HIS REMAND REPORT AND THERE IS NOTHING ADVERSE POINTED OUT BY THE ASSESSING OFFICER. DURING SUCH REMAND PROCEEDIN GS. IN THIS VIEW OF THE MATTER, WE THEREFORE, FIND NO REASON TO INTERFE RE WITH THE ACTION OF THE CIT(A) IN DELETING THE IMPUGNED ADDITION. HENCE ON THIS GROUND, REVENUE FAILS. 5. THE NEXT ISSUE IS WITH REGARD TO THE ADDITION OF RS. 2,34,315/- MADE BY THE ASSESSING OFFICER INVOKING PROVISIONS OF SEC TION 68 OF THE ACT. AS PER THE ASSESSING OFFICER IN THE ABSENCE OF ANY DET AILS FURNISHED BY THE ASSESSEE, THE AMOUNT OF SUNDRY CREDITORS OF RS. 2,5 0,000/- WAS LIABLE TO BE TREATED AS UNEXPLAINED. BEFORE THE CIT(A), THE ASSESSEE FURNISHED PARTY-WISE DETAILS OF CREDITORS WITH COPIES OF BILL S TO SUBSTANTIATE THE IMPUGNED SUM. THE ASSESSING OFFICER FURNISHED A RE MAND REPORT WITH RESPECT TO SUBMISSIONS TAKEN BY THE ASSESSEE BEFORE THE CIT(A). CONSIDERING THE REMAND REPORT OF THE ASSESSING OFFI CER AND THE MATERIAL PRODUCED BY THE ASSESSEE, THE CIT(A) RETAINED THE A DDITION OF RS. 15,835/- AND DELETED THE BALANCE OF RS. 2,34,315/-, AGAINST WHICH THE REVENUE IS IN APPEAL BEFORE US. 6. THE LEARNED DR HAS NOT BROUGHT ON RECORD ANY COG ENT REASONING TO DISLODGE THE FINDING OF THE CIT(A) IN THIS REGARD. THE CIT(A), AS IS EVIDENT FROM THE DISCUSSIONS IN PARA 28 OF THE IMPUGNED ORD ER HAS ALLOWED THE RELIEF TO THE ASSESSEE ON THE BASIS OF THE REPORT O F THE ASSESSING OFFICER AS WELL AS HIS OWN EXAMINATION OF THE COPIES OF THE BILLS OF THE CREDITORS BROUGHT ON RECORD BY THE ASSESSEE. IN THIS VIEW OF THE MATTER, WE FIND NO REASON TO INTERFERE WITH THE CONCLUSION OF THE CIT( A) WHICH WE AFFIRM. ACCORDINGLY, THE REVENUE FAILS ON THIS GROUND ALSO. PAGE 4 OF 10 ITA NO. 1204 AND 1093/PN/2010 NAHAR ANIL KUMAR A.Y. 2005-06 7. THE LAST GROUND OF APPEAL OF THE REVENUE IS WITH REGARD TO ASSESSEES CLAIM FOR DEPRECIATION OF RS. 96,050/- O N VEHICLES. THE CLAIM WAS DENIED BY THE ASSESSING OFFICER IN THE ABSENCE OF ANY DETAILS. THE CIT(A) HAS ALLOWED THE CLAIM AFTER NOTICING THAT TH E ASSESSEE HAS PRODUCED BILLS FOR PURCHASE OF VEHICLES ALONG WITH THE REQUISITE DOCUMENTS IN PROOF THEREOF. IN THIS VIEW OF THE MATTER, WE FI ND NO REASON TO INTERFERE WITH THE CONCLUSION OF THE CIT(A) WHICH WE AFFIRM. ACCORDINGLY, THE REVENUE FAILS ON THIS GROUND ALSO. 8. RESULTANTLY, THE APPEAL OF THE REVENUE FAILS. 9. NOW, COMING TO THE APPEAL OF THE ASSESSEE, THE F IRST GROUND OF APPEAL RELATES TO CONFIRMATION OF ADDITION OF RS. 9 ,65,594/- ON ACCOUNT OF OPENING BALANCE OF CAPITAL ACCOUNT MADE BY THE ASSE SSING OFFICER U/S 68 OF THE ACT WHICH WAS CONFIRMED BY THE CIT(A) HOLDIN G THAT NO FAULT CAN BE FOUND WITH THE ACTION OF THE ASSESSING OFFICER IN A DDING THIS AMOUNT TO THE INCOME OF THE ASSESSEE U/S 68 OF THE ACT. THE ACTIO N OF THE CIT(A) HAS BEEN CHALLENGED BY THE ASSESSEE IN APPEAL BEFORE US . 10. IN THIS REGARD, THE FACTS ARE THAT DURING THE C OURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER NOTICED THE OPEN ING CAPITAL BALANCE OF RS. 9,65,594/- WHICH WAS TREATED AS UNEXPLAINED AND ADDED U/S 68 OF THE ACT IN THE ABSENCE OF ANY DETAILS/EXPLANATION FORTH COMING FROM THE ASSESSEE. BEFORE THE CIT(A), ASSESSEE POINTED OUT THAT THE OPENING CAPITAL BALANCE WAS SOURCED FROM HIS PAST EARNINGS, WHICH HAD BEEN PUT IN THE BANK AND IT WAS FURTHER EXPLAINED THAT THE A SSESSEE HAD STARTED A NEW REAL ESTATE PROJECT DURING THE YEAR UNDER CONSI DERATION AND THEREFORE, THE ASSESSEE HAD BEEN ACCUMULATING RESOURCES NECESS ARY FOR PROCURING THE PROJECT LAND AT NIGDI. IN THIS CONNECTION, THE MATERIAL PUTFORTH BY THE ASSESSEE WAS SENT TO THE ASSESSING OFFICER FOR A RE MAND REPORT, A COPY OF WHICH HAS ALSO BEEN FILED IN THE PAPER BOOK AT PAGE S 27 TO 30. THE ASSESSING OFFICER REPORTED THAT THE SUM TOTAL OF LA ST FIVE YEARS NET INCOME PAGE 5 OF 10 ITA NO. 1204 AND 1093/PN/2010 NAHAR ANIL KUMAR A.Y. 2005-06 OF THE ASSESSEE WAS ALSO NOT ENOUGH TO EXPLAIN OPEN ING CAPITAL BALANCE OF RS. 9,65,594/- AND FURTHER THE ASSESSING OFFICER PO INTED OUT THAT THE YEAR- WISE CASH FLOW STATEMENT WAS NOT FORTHCOMING FROM T HE ASSESSEE. THE CIT(A) NOTICED ON THE BASIS OF MATERIAL ON RECORD T HAT THE ASSESSEE WAS NEITHER REGULAR IN FILING RETURNS OF INCOME IN THE PAST AND NOR WAS THERE A YEAR-WISE CASH FLOW STATEMENT; AND ACCORDING TO HIM WITHOUT ANY BALANCE SHEETS, DETAILS OF YEAR-WISE INVESTMENTS, ETC. IT W AS NOT POSSIBLE TO REACH A CONCLUSION THAT OPENING CAPITAL BALANCE TO THE TU NE OF RS. 9,65,594/- WAS SATISFACTORILY EXPLAINED. THE CIT(A) HAS CONCL UDED AS UNDER: THE ASSESSING OFFICER HAS CLEARLY BROUGHT OUT THAT THE APPELLANT HAS, IN THE PAST, NEITHER BEEN REGULAR IN SUBMITTING RETURNS OF INCOME, NOR THE RETURNS SUBMITTED BY HIM ARE SUFFICIENT TO EXPLAIN THE FUNDS CLAIMED TO AVAILABL E IN HIS HANDS, DEVOID, AS THEY WERE, OF VITAL INFORMATION W HICH WOULD HAVE HELPED ESTABLISH THE AVAILABILITY OF CAPITAL I N HIS HANDS. FURTHERMORE, EVEN IF THE APPELLANTS CLAIMS WERE TO BE ACCEPTED AT FACE VALUE, THE OVERALL AVAILABILITY OF RESOURCES IN THE HANDS OF THE APPELLANT AND ALL HIS FAMILY MEMBE RS TAKEN TOGETHER, DOES NOT, IPSO FACTO, ESTABLISH THAT THE FUNDS INVESTED IN BUSINESS DURING THE YEAR IN FACT CAME F ROM THEIR ACCUMULATED TAX PAID INCOME FOR EARLIER YEARS. IT WAS NECESSARY TO HAVE A COMPLETE PICTURE OF INCOMES EAR NED, INVESTMENTS MADE AND EXPENDITURES INCURRED (INCLUDI NG DAY-TO- DAY HOUSEHOLD EXPENDITURE OF THE FAMILY), TO COME T O A REASONABLE CONCLUSION REGARDING THE AVAILABILITY OF FUNDS IN HIS HANDS OF THE APPELLANT AND HIS FAMILY MEMBERS, AND TO ESTABLISH THE FACT OF FLOW THEREOF INTO THE APPELLA NTS BUSINESS. THE ONLY RELIABLE WAY TO ESTABLISH THIS, IN MY VIEW , WAS THROUGH A YEAR WISE CASH FLOW STATEMENT FOR THE PAS T FEW YEARS, WHICH WAS DULY CALLED FOR BY THE AO, BUT NOT PRODUCED BY THE APPELLANT. IN THE ABSENCE OF ANY SUCH STATE MENT, AND ALSO KEEPING IN VIEW THE EXTENT OF INCOME DISCLOSED IN THE RETURNS FILED BY THE APPELLANT WHICH IS NOT OF A VE RY HIGH ORDER, AND IN THE ABSENCE OF ANY DETAILS ESTABLISHING A NE XUS BETWEEN THE INCOME INVESTED IN BUSINESS IN THE CURR ENT YEAR AND INCOME EARNED AND DISCLOSED FOR THE PURPOSES OF TAX IN THE PAST YEARS AND SAVINGS MADE THEREFROM, IT IS NO T POSSIBLE TO REACH TO A CONCLUSION THAT THE OPENING BALANCE TO THE TUNE OF RS. 9,65,594/- HAS BEEN SATISFACTORILY EXPLAINED . UNDER THE CIRCUMSTANCES, NO FAULT CAN BE FOUND WITH THE AOS ACTION OF ADDING THIS AMOUNT TO THE INCOME OF THE APPELLANT U NDER SECTION 68. 11. AGAINST THE AFORESAID, THE ASSESSEE CONTENDED B EFORE US THAT IT WAS QUITE CLEAR THAT THE OPENING BALANCE OF THE CAPITAL ACCOUNT WAS NOT THE CREDIT PERTAINING TO THE YEAR UNDER CONSIDERATION A ND, THEREFORE, SECTION 68 OF THE ACT WAS INCORRECTLY APPLIED TO MAKE THE I MPUGNED ADDITION. IN PAGE 6 OF 10 ITA NO. 1204 AND 1093/PN/2010 NAHAR ANIL KUMAR A.Y. 2005-06 SUPPORT, RELIANCE HAS ALSO BEEN PLACED ON THE JUDGM ENT OF THE HONBLE RAJASTHAN HIGH COURT IN THE CASE OF CIT VS. PRAMESH WAR BOHRA (2008) 301 ITR 404. APART THEREFROM, THE LEARNED COUNSEL SUBMITTED THAT THE ASSESSEE HAD DULY POINTED OUT THAT THE OPENING CAPI TAL BALANCE WAS LYING INVESTED IN THE ASSETS AS SHOWN IN THE BALANCE SHEE T AND THEREFORE, THE SAME WAS JUSTIFIABLE. THE LEARNED COUNSEL ALSO REF ERRED TO PAGES 28 TO 29 OF THE PAPER BOOK WHEREIN IS PLACED THE RELEVANT PO RTION OF THE REMAND REPORT OF THE ASSESSING OFFICER DEALING WITH THE EX PLANATION OF THE ASSESSEE REGARDING INCOME LEVELS OF THE PAST YEARS; AND IT IS SUBMITTED THAT THE ASSESSEE HAD INDEED SATISFACTORILY EXPLAIN ED THE AVAILABILITY OF THE OPENING CAPITAL BALANCE AT RS. 9,65,594/- AND T HE AUTHORITIES HAVE UNJUSTLY REJECTED THE EXPLANATIONS. IN THIS MANNER , ORDERS OF THE LOWER AUTHORITIES HAVE BEEN ASSAILED. 12. ON THE OTHER HAND, THE LEARNED DR APPEARING FOR THE REVENUE VEHEMENTLY POINTED OUT THAT NO FAULT CAN BE FOUND W ITH THE CONCLUSION DRAWN BY THE CIT(A), INASMUCH AS THE ASSESSEE HAD N OT FURNISHED BALANCE SHEETS IN THE PAST AND IN ANY CASE IT WAS POINTED O UT THAT THE ASSESSEE HAD NOT FURNISHED THE BOOKS OF ACCOUNT AT ANY STAGE . IT WAS ALSO POINTED OUT THAT THE ASSESSING OFFICER HAS BROUGHT OUT IN T HE REMAND REPORT THAT IN THE ABSENCE OF THE BALANCE SHEETS OF RESPECTIVE YEA RS, THE YEAR-WISE CASH FLOW STATEMENT INDICATING INCOME AND INVESTMENTS LE VELS WAS ALSO NOT AVAILABLE TO JUSTIFY THE IMPUGNED OPENING CAPITAL B ALANCE. 13. WE HAVE CAREFULLY CONSIDERED THE RIVAL SUBMISSI ONS. IN THIS CASE, IT IS UNDISPUTED FACT EMERGING FROM RECORD THAT THE AS SESSEE DID NOT PRODUCE THE BOOKS OF ACCOUNT AT ANY STAGE BEFORE THE LOWER AUTHORITIES. A COPY OF THE BALANCE SHEET FOR THE YEAR ENDING 31-3-2005 COR RESPONDING TO ASSESSMENT YEAR UNDER CONSIDERATION HAD BEEN SUBMIT TED ALONG WITH THE RETURN OF INCOME, SO HOWEVER, AS PER THE REMAND REP ORT OF THE ASSESSING OFFICER TO THE CIT(A), IT IS QUITE CLEAR THAT FOR T HE ASSESSMENT YEARS 1999- PAGE 7 OF 10 ITA NO. 1204 AND 1093/PN/2010 NAHAR ANIL KUMAR A.Y. 2005-06 2000, 2000-01 TO 2004-05 NO BALANCE SHEETS WERE FIL ED ALONG WITH THE RESPECTIVE RETURNS OF INCOME. EVEN DURING THE COUR SE OF HEARING BEFORE US, THERE WAS NO ASSERTION WITH REGARD TO MAINTENAN CE OF BOOKS OF ACCOUNT AND ON BEING QUERIED IT WAS POINTED OUT BY THE LEARNED COUNSEL THAT THE OPENING CAPITAL BALANCE WAS COMPUTED AS A BALANCING FIGURE AFTER DRAWING UP THE STATEMENTS OF ASSETS AND LIABILITIES . BE THAT AS IT MAY, IN OUR VIEW, THE ONUS WAS ON THE ASSESSEE TO JUSTIFY T HE AVAILABILITY OF THE OPENING CAPITAL BALANCE OF RS. 9,65,594/- HAVING RE GARD TO HIS PAST EARNINGS. NOTABLY, A SUBSTANTIVE PLEA OF THE ASSES SEE TO EXPLAIN THE SOURCE OF OPENING CAPITAL BALANCE HAS BEEN HIS PAST EARNINGS, WHICH IT HAS BEEN CLAIMED WERE PARKED IN THE BANK. IN THIS CONTEXT, WE HAVE EXAMINED THE DISCUSSIONS MADE BY THE ASSESSING OFFI CER IN HIS REMAND REPORT, A COPY OF WHICH IS ON RECORD AND IT CLEARLY TRANSPIRES THAT THE LEVEL OF INCOME DECLARED IN THE ASSESSMENT YEARS 1999-200 0, 2000-01 TO 2004- 05 RANGES FROM RS. 67,000/- TO RS. 1,25,000/-. APA RT FROM THIS, THE ASSESSING OFFICER HAS ALSO OBSERVED THAT THE BANK A CCOUNT MAINTAINED BY THE ASSESSEE WITH CENTRAL BANK OF INDIA SHOWED A C LOSING BALANCE OF RS. 11,60,512/- AS ON 31-3-2004. IN THE REMAND PROCEED INGS, ASSESSEE CLAIMED THAT OUT OF SUCH BALANCE IN THE BANK ACCOUN T AMOUNT TO THE TUNE OF RS. 5,10,512/- WAS AVAILABLE TOWARDS OPENING CAP ITAL BALANCE. THE ASSESSING OFFICER AND THEREAFTER, THE CIT(A) HAS NO T ACCEPTED THE EXPLANATION OF THE ASSESSEE FOR THE REASON THAT THE INCOME LEVELS DID NOT JUSTIFY ACCUMULATION OF IMPUGNED OPENING CAPITAL BA LANCE AND SECONDLY, THE ABSENCE OF YEAR-WISE CASH FLOW STATEMENT. QUIT E CLEARLY THE LEVEL OF INCOMES DECLARED BY THE ASSESSEE IN THE PAST FIVE Y EARS DO NOT JUSTIFY THE ACCUMULATION OF OPENING CAPITAL BALANCE AS ON 1-4-2 004 TO THE EXTENT OF RS. 9,65,594/-. SO HOWEVER, IN OUR VIEW, IT IS INC ORRECT ON THE PART OF THE AUTHORITIES TO HAVE OUTRIGHTLY REJECTED THE ENTIRE CLAIM MADE OUT BY THE ASSESSEE ON ACCOUNT OF THE EXISTENCE OF PAST EARNIN GS. IN OUR CONSIDERED VIEW, HAVING REGARD TO THE MATERIAL ON RECORD, IT W OULD BE IN THE FITNESS OF THINGS THAT SOME ESTIMATE BE MADE, WHICH IS NECESSI TATED IN THE ABSENCE PAGE 8 OF 10 ITA NO. 1204 AND 1093/PN/2010 NAHAR ANIL KUMAR A.Y. 2005-06 OF ANY SPECIFIC CASH FLOW STATEMENT AND REGULAR MAI NTENANCE OF ACCOUNT BOOKS. IN OUR VIEW, HAVING REGARD TO THE FACTS AND CIRCUMSTANCES OF THE CASE, IT WOULD BE REASONABLE TO HOLD THAT TO THE EX TENT OF RS. 5,00,000/- THE ASSESSEE CAN BE CONSIDERED TO HAVE EXPLAINED TH E EXISTENCE OF PAST EARNINGS SO AS TO EXPLAIN SUCH AMOUNT OF OPENING CA PITAL BALANCE. AS A RESULT, OUT OF OPENING CAPITAL BALANCE CLAIMED AT R S. 9,65,594/- A SUM OF RS. 5,00,000/- IS ACCEPTED AS EXPLAINED AND ACCORDI NGLY THE DISALLOWANCE IS RESTRICTED TO THE BALANCE OF RS. 4,65,594/-. ON THIS GROUND, THE ASSESSEE PARTLY SUCCEEDS. 14. BEFORE PARTING, WE MAY REFER TO THE JUDGMENT OF HONBLE RAJASTHAN HIGH COURT IN THE CASE OF PRAMESHWAR BOHRA (SUPRA), WHICH HAS BEEN RELIED UPON BY THE ASSESSEE BEFORE US. IN THE CASE BEFORE HONBLE RAJASTHAN HIGH COURT THE ASSESSEE WAS FOUND TO HAVE CREDITED AN AMOUNT OF INVESTMENT/CASH CREDIT AS ON THE FIRST DAY OF TH E PREVIOUS YEAR RELEVANT TO THE ASSESSMENT YEAR UNDER CONSIDERATION. THE AS SESSING OFFICER ADDED SUCH AMOUNT AS UNEXPLAINED INVESTMENT IN THE HANDS OF THE ASSESSEE. THE TRIBUNAL DELETED THE ADDITION ON THE GROUND THAT IT WAS NOT A CASE OF CASH CREDIT ENTERED INTO THE BOOKS OF ACC OUNT OF THE ASSESSEE DURING THE YEAR UNDER CONSIDERATION, BUT IT WAS A C ASE IN WHICH THE ASSESSEE HAD INVESTED THE CAPITAL IN THE BUSINESS A ND SUCH AMOUNT WAS SHOWN AS CLOSING CAPITAL AS AT THE END OF THE PRECE DING YEAR AND ON THE FIRST DAY OF THE CURRENT YEAR IT WAS AN OPENING BAL ANCE. THE HONBLE RAJASTHAN HIGH COURT AFFIRMED THE ORDER OF THE TRIB UNAL NOTICING THAT THE CARRIED FORWARD AMOUNT OF THE PRECEDING YEAR COULD NOT BECOME AN INVESTMENT OR CASH GENERATED DURING THE SUCCEEDING YEAR WHICH WAS THE YEAR UNDER CONSIDERATION. IN OUR CONSIDERED OPINIO N THE RATIO OF THE JUDGMENT OF HONBLE RAJASTHAN HIGH COURT IS APT, SO HOWEVER, THE SAME IS INAPPLICABLE TO THE FACTS OF THE PRESENT CASE, INAS MUCH AS THE JUDGMENT HAS BEEN RENDERED IN THE BACKGROUND OF THE FACTS AS EXISTING IN THE CASE BEFORE THE HIGH COURT. NOTABLY, IN THE CASE BEFORE THE HONBLE RAJASTHAN PAGE 9 OF 10 ITA NO. 1204 AND 1093/PN/2010 NAHAR ANIL KUMAR A.Y. 2005-06 HIGH COURT THE TRIBUNAL HAD COME TO A FINDING OF FA CT THAT IT WAS NOT A CASE OF CASH CREDIT ENTERED INTO THE BOOKS OF ACCOU NT OF THE ASSESSEE FOR THE YEAR UNDER CONSIDERATION BEFORE IT AND FURTHER THAT THE AMOUNT WAS CLOSING BALANCE OF THE PRECEDING YEAR. PERTINENTLY SUCH A FINDING WAS WITH REFERENCE TO THE BOOKS OF ACCOUNT MAINTAINED BY THE ASSESSEE THEREIN. CLEARLY IN THE PRESENT CASE, THE FACTUAL MATRIX IS ON AN ALTOGETHER DIFFERENT FOOTING INASMUCH THE BOOKS OF ACCOUNT OF THE ASSESS EE ARE MISSING AND THE CASE OF THE ASSESSEE IS NOT BASED ON ANY REGULA RLY MAINTAINED BOOKS OF ACCOUNT. THEREFORE, THE ASSESSEE CANNOT CLAIM T HE BENEFIT OF PARITY OF REASONING UPHELD BY THE HONBLE RAJASTHAN HIGH COUR T IN THE CASE OF PRAMESHWAR BOHRA (SUPRA) AS THE FACTS STAND ON ENTI RELY DIFFERENT FOOTING. THEREFORE, THE JUDGMENT OF HONBLE RAJASTHAN HIGH C OURT DOES NOT HELP THE CASE OF THE ASSESSEE. 15. THE NEXT GROUND OF APPEAL RELATES TO CONFIRMATI ON OF ADDITION OF RS. 50,620/- WITH REGARD TO TOTAL OUTSTANDING EXPENSES MADE BY THE ASSESSING OFFICER U/S 68 OF THE ACT. THE ASSESSEE CLAIMED TH AT THE OUTSTANDING EXPENSES WERE FOR WAGES OF LABOURERS AND FOR SALARY PAYMENTS. IN ABSENCE OF ANY EVIDENTIARY PROOF ADDUCED BY THE ASS ESSEE, THE ASSESSING OFFICER HAS CLEARLY STATED THAT THE EXPLANATION PRO VIDED BY THE ASSESSEE WAS NOT ACCEPTABLE AND HE MADE AN ADDITION OF RS. 5 0,620/- TO THE TOTAL INCOME OF THE ASSESSEE U/S 68 OF THE ACT, WHICH WAS CONFIRMED BY THE CIT(A) IN APPEAL. BEFORE US ALSO, THE ASSESSEE HAS NOT PRODUCED ANY DETAILS OF THE SAID LIABILITY. FURTHER, IN HIS REM AND REPORT, TO THE CIT(A) THE ASSESSING OFFICER HAS CATEGORICALLY MENTIONED T HAT THE EXPLANATION OFFERED BY THE ASSESSEE WAS NOT ACCEPTABLE FOR WANT OF DETAILS. IN THIS VIEW OF THE MATTER, WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF THE CIT(A) ON THIS ISSUE. AS SUCH THE GROUND RAISE BY THE ASS ESSEE IS DISMISSED. 16. IN THE RESULT, THE REVENUES APPEAL IS DISMISSE D WHILE THE APPEAL OF THE ASSESSEE IS PARTLY ALLOWED. PAGE 10 OF 10 ITA NO. 1204 AND 1093/PN/2010 NAHAR ANIL KUMAR A.Y. 2005-06 DECISION PRONOUNCED IN THE OPEN COURT ON 17 TH SEPTEMBER 2012. SD/- SD/- (R.S. PADVEKAR) JUDICIAL MEMBER (G.S. PANNU) ACCOUNTANT MEMBER PUNE DATED THE 17 TH SEPTEMBER 2012. ANKAM COPY OF THE ORDER IS FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT- (V) PUNE 4. THE CIT- V PUNE 5. THE D.R, A BENCH, PUNE BY ORDER SR. PRIVATE SECRETARY INCOME TAX APPELLATE TRIBUNAL PUNE