SHRI BANWARI LAL AGRAWAL, AJMER V. ITO, WARD-2, KISHANGARH

ITA 1245/JPR/2019

• Counselvise Citation: [2020] 110 COUNSELVISE.COM (IT) 4828 (ITAT-JAIPUR)
• Duration Of Justice: 11 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-10-2020
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2011-2012
• Appeal Filed On: 04-11-2019
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: CHANCHAL MEENA ACIT DHK
• Keywords: Accommodation entries
• Section: 131; 148

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES (SMC), JAIPUR JH FOT; IKY JKO] U;KF;D LNL; DS LE{K BEFORE: SHRI VIJAY PAL RAO, JUDICIAL MEMBER VK;DJ VIHY LA-@ ITA NO. 1245/JP/2019 FU/KZKJ.K O'K Z@ ASSESSMENT YEAR : 2011-12 SHRI BANWARI LAL AGARWAL WARD-20, AZAD NAGAR, MADANGANJ, KISHANGARH, AJMER-305801. CUKE VS. THE ITO, WARD-2, KISHANGARH. LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO.: AASPA 0201D VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT FU/KZKFJRH DH VKSJ LS@ ASSESSEE BY : NONE JKTLO DH VKSJ LS@ REVENUE BY : MISS CHANCHAL MEENA (ACIT) LQUOKBZ DH RKJH[K@ DATE OF HEARING : 12/10/2020 MN?KKS'K .KK DH RKJH[K @ DATE OF PRONOUNCEMENT : 13/10/2020 VKNS'K@ ORDER PER: VIJAY PAL RAO, J.M. THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST TH E ORDER DATED 20.08.2019 OF LD. CIT(A), AJMER FOR THE ASSESSMENT YEAR 2011-12. DUE TO PREVAILING COVID-19 PANDEMIC CONDITION THE HEARING OF THE APPEALS ARE CONCLUDED THROUGH VIDEO CONFERENCE. THE ASSESSEE HA S RAISED FOLLOWING GROUNDS:- ITA NO. 1245/JP/19 SHRI BANWARI LAL VS. ITO 2 1. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE , THE NOTICE ISSUED UNDER SECTION 148 BY THE LD. AO IS BAD IN LA W FOR VARIOUS REASONS AND PRAYED FOR BEING QUASHED. 2. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD. AO ERRED IN REOPENING THE ASSESSMENT WITHOUT HAVING JURISDIC TION AND ALSO WITHOUT HAVING ANY REASONS TO BELIEVE AS ON THE DAT E OF ISSUE OF NOTICE U/S 147/148 THAT INCOME HAS ESCAPED ASSESSME NT. THE ASSESSMENT IN PURSUANCE OF SAME IS THUS PRAYED FOR BEING QUASHED. 3. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD. AO ERRED IN REOPENING THE ASSESSMENT WITHOUT OBTAINING APPRECIA TE SANCTION AS PROVIDED U/S 151 OF THE ACT AND THUS ASSESSMENT IN PURSUANCE OF SAME IS PRAYED FOR BEING DECLARED VOID AB INITIO. 4. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) ERRED IN CONFIRMING THE ACTION OF LD. AO OF MAKING ADDITI ON IN HANDS OF ASSESSEE OF AN INCOME WHICH DOES NOT BELONG TO THE ASSESSEE AT ALL IGNORING THE FACTS AND CIRCUMSTANCES OF THE CASE. S UCH AN ADDITION IS INVALID AND HENCE PRAYED FOR BEING DELETED. 5. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD. AO ERRED IN CONCLUDING THE ASSESSMENT WITHOUT MAKING PROPER INQUIRIES IN THE MATTER AND THUS ARBITRARILY. SUCH AN ARBITRARY ASSE SSMENT IS THUS PRAYED FOR BEING QUASHED. 6. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) ERRED IN CONFIRMING THE ACTION OF LD. AO OF ADDITION IN H ANDS OF ASSESSEE IGNORING THE FACT THAT ASSESSEE WAS NOT INDULGED IN ANY BUSINESS ACTIVITIES AND HAD NO SOURCE FROM WHICH SUCH HUGE R ECEIPTS CAN BE OBTAINED BY HIM. SUCH AN INVALID AND ARBITRARY ADDI TION IS THUS PRAYED FOR BEING DELETED. ITA NO. 1245/JP/19 SHRI BANWARI LAL VS. ITO 3 7. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND W ITHOUT PREJUDICE TO OTHER GROUNDS OF APPEAL, THE LD. CIT(A) HAD ERRE D IN CONFIRMING THE ACTION OF LD. AO OF ASSESSING THE INCOME OF ASS ESSEE AT RS. 45,62,075.00 WHICH IS IN ALTERNATE EXCESSIVE AND UN JUSTIFIED. IT IS HEREBY PRAYED FOR REDUCING THE ADDITION THUS MADE. 8. THE APPELLANT HEREBY CRAVES LEAVE TO ADD, ALTER, AMEND OR SUBSTITUTE ONE OR MORE GROUNDS OF APPEAL AT THE TIM E OF HEARING. 2. NONE HAS APPEARED ON BEHALF OF THE ASSESSEE WHEN THIS APPEAL WAS CALLED FOR HEARING DESPITE THE FACT THAT THE HEARIN G WAS ADJOURNED FOR TODAY I.E. 12.10.2020 AT THE REQUEST OF THE ASSESSE E. THEREFORE, IN THE FACTS AND CIRCUMSTANCES OF THE CASE I PROPOSE TO HE AR AND DISPOSE OFF OF THIS APPEAL EX-PARTE. THE ONLY ISSUE ARISES IN THIS APPEAL IS REGARDING ADDITION OF RS. 44,59,430/- WAS MADE BY THE AO ON A CCOUNT OF COMMISSION INCOME FOR PROVIDING ACCOMMODATION ENTRIES OF MARBL E SALES. 3. THE LD. DR HAS SUBMITTED THAT THE ASSESSEE BEING A PROPRIETOR OF TWO PROPRIETARY CONCERNS M/S DANGEROUS MARBLE SUPPL IERS AND M/S HERBAL MARBLE HAS NOT FILED ANY RETURN OF INCOME U/S 139(1 ) OF THE INCOME TAX ACT. THE AO RECEIVED INFORMATION REGARDING DEPOSIT OF RS. 4,56,20,758/- IN THE BANK ACCOUNT OF THE ASSESSEE DURING THE YEAR UNDER CONSIDERATION. THE SAID TRANSACTIONS OF DEPOSITS IN THE BANK ACCOU NT OF THE ASSESSEE WAS DETECTED DURING THE INQUIRY CONDUCTED BY THE DDIT(I NV)-II UDAIPUR AND ITA NO. 1245/JP/19 SHRI BANWARI LAL VS. ITO 4 THE ASSESSEE ACCEPTED THE FACT IN HIS STATEMENT REC ORDED ON 21.12.2018 U/S 131 OF THE ACT. THE LD DR HAS REFERRED TO THE A SSESSMENT ORDER WHEREIN THE AO HAS REPRODUCED THE STATEMENT OF THE ASSESSEE RECORDED U/S 131 OF THE ACT. THUS, THE LD. DR HAS SUBMITTED THAT THE ASSESSEE HAS ACCEPTED THE FACT OF DEPOSIT OF CASH IN HIS BANK AC COUNT HOWEVER, HE HAS CLAIMED THAT THE ASSESSEE HAS NOT CARRIED OUT ANY T RANSACTION OF PURCHASE OR SALE OF MARBLE BUT HE HAS PROVIDED BOGUS ACCOMMO DATION ENTRIES TO VARIOUS PERSONS WHO HAVE DEPOSITED CASH THE ACCOUN T OF THE ASSESSEE. THE ASSESSEE HAS ALSO ACCEPTED THE INCOME ON ACCOUN T OF COMMISSION FOR PROVIDING THESE ACCOMMODATION ENTRIES. THE LD. DR H AS POINTED OUT THAT THE AO AS WELL AS LD. CIT(A) FOLLOWED THE DECISION OF THIS TRIBUNAL AS WELL AS HONBLE HIGH COURT IN CASE OF SMT AANITA CHOUDHA RI WHEREIN THE INCOME @ 10% OF THE TOTAL DEPOSIT WAS UPHELD. SHE HAS RELI ED UPON THE ORDERS OF THE AUTHORITIES BELOW. 4. HAVING CONSIDERED THE SUBMISSIONS OF THE LD. DR AND CAREFUL PERUSAL OF THE ORDERS OF THE AUTHORITIES BELOW IT IS NOTED THAT THE ASSESSEE HAS NOT DISPUTED THE FACT OF DEPOSIT OF MORE THAN 4.56 CROR ES IN HIS BANK ACCOUNT. THE ASSESSEE IS ALSO HAVING TWO PROPRIETORSHIP CONC ERNS FROM WHERE THE ASSESSEE HAS ADMITTED TO HAVE ISSUED BILLS REGARDIN G BOGUS ACCOMMODATION ENTRIES OF SALE. THE DEPARTMENT HAS A CCEPTED THIS ITA NO. 1245/JP/19 SHRI BANWARI LAL VS. ITO 5 EXPLANATION OF THE ASSESSEE THAT THE AMOUNT DEPOSIT ED IN THE BANK ACCOUNT OF THE ASSESSEE IS ON ACCOUNT OF BOGUS ACCO MMODATION SALE ENTRIES PROVIDED BY THE ASSESSEE TO VARIOUS PARTIES AND THE ASSESSEE HAS EARNED ONLY COMMISSION INCOME ON SUCH DEPOSIT. THE AO AFTER CONSIDERING THE STATEMENT OF THE ASSESSEE U/S 131 HAS HELD AS U NDER:- FROM THE ABOVE STATEMENTS IT IS CLEAR THAT THE ASS ESSEE HAS COMPLETELY FAILED TO PROVE THAT THE CASH DEPOSITS W ERE NOT PERTAINING TO HIM AND WERE PERTAINING TO DIFFERENT MARBLE TRAD ERS OF KISHANGARH. THE ASSESSEE HAS FAILED TO DISCHARGE TH E ONUS LAID UPON HIM AS HE HAS NO DOCUMENTARY EVIDENCE IN SUPPORT OF HIS STATEMENTS. THEREFORE, CASH DEPOSITS IN THE BANK AC COUNTS OF THE ASSESSEE ARE TREATED AS HIS OWN CASH. IN VIEW OF ABOVE DISCUSSED FACTS OF THE CASE AND RE LYING UPON THE DECISION OF HONBLE BENCH OF ITAT, JAIPUR IN CASE O F SMT ANITAL CHOUDHARY IN ITA NO. 733/JP/2009 DATED 07.05.2010 W HICH WAS CONFIRMED BY HONBLE RAJASTHAN HIGH COURT IN DBITA NO. 289/2010 DATED 14.10.2011 INCOME OF THE ASSESSEE FOR THE YEA R UNDER CONSIDERATION IS ASSESSED AT RS. 45,62,075/- WHICH IS 10% OF THE TOTAL DEPOSITS IN THE BANK ACCOUNT OF THE ASSESSEE I.E. RS. 4,56,20,758/-. ACCORDINGLY DIFFERENCE AMOUNT OF RS. 44,59,428/- IS ADDED TO THE INCOME OF THE ASSESSEE (RS. 44,59,075- RS. 1,02,647/- ). ITA NO. 1245/JP/19 SHRI BANWARI LAL VS. ITO 6 THE ASSESSEE CHALLENGED THE ORDERS OF THE AO BEFORE THE LD. CIT(A) AND DISPUTED ONLY PERCENTAGE OF COMMISSION. THE LD. CIT (A) HAS CONFIRMED THE ADDITION MADE BY THE AO IN PARA 5.3 IS AS UNDER:- 5.3 I HAVE GONE THROUGH THE ASSESSMENT ORDER, STAT EMENT OF FACTS, GROUNDS OF APPEAL, WRITTEN SUBMISSION, REMAND REPOR T AND REJOINDER CAREFULLY. IT IS SEEN THAT THE BANK ACCOUNT WAS IN THE NAME OF THE APPELLANT. THE APPELLANT COULD NOT FURNISH ANY DOCU MENTARY EVIDENCE OF SHOW THAT HIS BANK ACCOUNT WAS USED BY OTHER PERSONS. THE AO IN THE ASSESSMENT ORDER HAS GIVEN DETAILED R EASON FOR NOT ACCEPTING THE CONTENTION OF THE APPELLANT THAT HIS BANK ACCOUNT WAS USED BY OTHER PERSONS. THE AP HAS BEEN VERY REASONABLE IN ESTIMATING THE N ET PROFIT ONLY AT THE RATE OF 10% OF THE TOTAL CASH DEPOSITS RELYING ON THE DECISION OF JURISDICTIONAL ITAT AND HIGH COURT IN THE CASE OF S MT ANITA CHOUDHARY. THEREFORE, I AM OF THE CONSIDERED VIEW T HAT THE ADDITION OF RS. 45,62,075/- MADE BY THE AO IS FULLY JUSTIFIE D AND AS PER THE PROVISIONS OF LAW. ACCORDINGLY, THE ADDITION OF RS. 45,62,075/- MADE BY THE AO IS HEREBY CONFIRMED. THUS, BOTH THE AO AS WELL AS THE LD. CIT(A) HAS APP LIED 10% OF THE TOTAL CASH DEPOSIT AS COMMISSION INCOME OF THE ASSESSEE B Y FOLLOWING THE DECISION OF THIS TRIBUNAL IN CASE OF SMT. ANITA CHO UDHARY IN ITA NO. 733/JP/2009 WHICH WAS UPHELD BY THE HONBLE HIGH CO URT VIDE DECISION DATED 14.10.20111 IN DBITA NO. 289/2010. IN THE ABS ENCE OF ANY CONTRARY ITA NO. 1245/JP/19 SHRI BANWARI LAL VS. ITO 7 MATERIAL THE IMPUGNED ORDER OF THE LD. CIT(A) FOLLO WING JUDGMENT THE JURISDICTION HIGH COURT IS UPHELD. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS DIS MISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 13/10/2020. SD/- FOT; IKY JKO (VIJAY PAL RAO) U;KF;D LNL; @ JUDICIAL MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 13/10/2020 *SANTOSH VKNS'K DH IZFRFYFI VXZSFKR @ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ @ THE APPELLANT- SHRI BANWARI LAL AGARWAL, KISHANGAR H, AJMER. 2. IZR;FKH @ THE RESPONDENT- ITO, WARD-2, KISHANGARH. 3. VK;DJ VK;QDR @ CIT 4. VK;DJ VK;QDRVIHY @ THE CIT(A) 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ @ DR, ITAT, JAIPUR 6. XKMZ QKBZY @ GUARD FILE (ITA NO. 1245/JP/19) VKNS'KKUQLKJ @ BY ORDER, LGK;D IATHDKJ @ ASST. REGISTRAR