Dr. Kailash Parashar, Shimla V. ITO, Solan

ITA 125/CHANDI/2012

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 60828 (ITAT-CHANDIGARH)
• Duration Of Justice: 2 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-04-2012
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2007-2008
• Appeal Filed On: 01-02-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: M L JHAMBAABHISHEK JHAMBA
• Keywords: Loose papers; Corroborative evidences
• Section: 143(3); 154

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL CHANDIGARH BENCH A CHANDIGARH BEFORE SHRI T.R. SOOD, AM AND MS. SUSHMA CHOWLA, JM ITA NO. 125 /CHD/2012 ASSESSMENT YEAR: 2007-08 DR KAILASH PARASHAR V. I.T.O. THE MALL WARD 1 SHIMLA SOLAN PAN: ABVPP 8178 L (APPELLANT) (RESPONDENT) APPELLANT BY: S/SHRI M.L. JHAMBA/ABHISHEK JHAMBA RESPONDENT BY: SHRI AKHILESH GUPTA DATE OF HEARING: 19.04.2012 DATE OF PRONOUNCEMENT: 25.04.2012 ORDER PER T.R. SOOD, A.M IN THIS APPEAL THE ASSESSEE HAS RAISED THE FOLLOWI NG TWO GROUNDS: 1 THAT THE LD. CIT(A) IS NOT JUSTIFIED IN CONFIRM ING AN ADDITION OF RS. 5,23,488/- IN PROFESSIONAL INCOME. 2. THAT THE LD. CIT(A) IS NOT JUSTIFIED IN CONFIRM ING AN ADDITION OF RS. 3,89,000/- U/S 68 OF THE INCOME-TAX ACT. 2. AFTER HEARING BOTH THE PARTIES, WE FIND THAT A SURVEY WAS CONDUCTED IN THE PREMISES OF THE ASSESSEE ON 20.9.2007. DURING THE SURVEY SOME LOOSE PAPERS WERE FOUND WHICH WERE UNVERIFIABLE IN THE ABSENCE O F BOOKS OF ACCOUNT. CERTAIN DISCREPANCIES IN THE BANK TRANSACTIONS, CAS H IN HAND WERE ALSO FOUND. IN VIEW OF THIS THE ASSESSEE AGREED TO OFFER ADDITI ONAL INCOME OF RS. 10.00 LAKHS AND PROMISED TO PAY ADVANCE TAX. HOWEVER, NO SUCH INCOME WAS OFFERED. DURING ASSESSMENT PROCEEDINGS, THE ASSESSE E FILED AUDIT REPORT WHEREIN IT WAS MENTIONED THAT THE ASSESSEE IS MAINT AINING CASH BOOK, LEDGER, BILL BOOK AND PURCHASE VOUCHERS ETC. IT WAS NOTED THAT THE ASSESSEE HAD SHOWN PROFESSIONAL RECEIPTS AT RS. 7,59,325/- BUT T HE SAME WERE NOT SUPPORTED BY PATIENTS REGISTER, RECEIPT BOOK, CASH BOOK OR AN Y OTHER DOCUMENTS. FURTHER THE ASSESSEE HAD CLAIMED EXPENSES OF RS. 2,76,512/- WHICH WAS AGAIN NOT SUPPORTED BY VOUCHERS. IN THE ABSENCE OF ANY DOCU MENTARY EVIDENCE, THE 2 PROFESSIONAL RECEIPT WERE ESTIMATED AT RS. 1.00 LAK HS AND EXPENSES WERE ESTIMATED AT RS. 2.00 LAKHS AND NET PROFESSIONAL IN COME WAS ASSESSED AT RS. 8.00 LAKHS. 3. IN APPEAL, IT WAS MAINLY STATED THAT THE PATIENT REGISTER AND PURCHASE VOUCHERS WERE PRODUCED BEFORE THE ASSESSING OFFICER . MOREOVER, THE EXPENDITURE CLAIMED WAS RS. 4,82,813/- WHICH WAS WR ONGLY TAKEN AT RS. 2,76,512/-. THE LD. CIT(A) DID NOT AGREE WITH THE SUBMISSIONS AND CONFIRMED THE ADDITION VIDE PARA 4 OF HIS ORDER WHICH IS AS U NDER: 4. THE RIVAL SUBMISSIONS HAVE BEEN CAREFULLY CONSI DERED. IT IS SEEN THAT IN THE ORDER PASSED U/S 154/155 THE ASSESSING OFFICER HAS CLARIFIED THAT THE EXPENSES WERE ESTIMATED AT RS. 2 LAKHS AS AGAINST RS. 4,82,813/- CLAIMED BY THE ASSESSEE AND THUS THERE W AS NO MISTAKE APPARENT FROM RECORD. IT IS NOTED THAT THE APPELLA NT ABSOLUTELY FAILED TO PROVE BEFORE THE ASSESSING OFFICER THAT THE STATEME NT MADE DURING THE COURSE OF SURVEY ACTION WAS NOT CORRECT OR THAT THE STATEMENT AS PER THE AUDIT REPORT IS CORRECT. THE APPELLANT FAILED TO P RODUCE THE CASH BOOK AND LEDGER DURING THE COURSE OF ASSESSMENT PROCEEDI NGS, THEREBY CONFIRMING HIS STAND DURING THE COURSE OF SURVEY TH AT HE WAS NOT MAINTAINING ANY BOOKS OF ACCOUNT. THUS ON THE GIVE N FACTS, THE AUDIT REPORT PRESENTED BY THE APPELLANT BEFORE THE ASSESS ING OFFICER IS NOT TRULY SUBSTANTIATED BY ACTUAL BOOKS OF ACCOUNT. SINCE TH E APPELLANT FAILED TO DISCHARGE HIS ONUS OF PRODUCING THE BOOKS OF ACCOUN T, THE ASSESSING OFFICER WAS JUSTIFIED IN ESTIMATING THE INCOME OF T HE APPELLANT FROM HIS MEDIAL PROFESSION. IT HAS ALSO DULY BEEN RECORDED BY THE ASSESSING OFFICER THAT THE VOUCHERS IN SUPPORT OF EXPENSES WE RE NEITHER MAINTAINED NOR PRODUCED DURING THE COURSE OF ASSESSMENT PROCEE DINGS. THE APPELLANT HAS ALSO SUBMITTED THAT ONLY THE PURCHASE VOUCHERS WERE PRODUCED DURING THE COURSE OF ASSESSMENT PROCEEDING S. IN THE ABSENCE OF THE SUPPORTING DOCUMENTS, THE ASSESSING OFFICER HAS ALLOWED THE EXPENDITURE TO THE TUNE OF RS. 2 LAKHS ONLY. KEEPI NG IN VIEW THE TOTALITY OF THE CIRCUMSTANCES OF THE APPELLANTS CASE, IT AP PEARS THAT THE ASSESSING OFFICER WAS JUSTIFIED IN ALLOWING THE EXP ENSES ON AN ESTIMATED BASIS. ACCORDINGLY THERE DOES NOT SEEM TO BE ANY G ROUND TO INTERFERE WITH THE ORDER OF THE ASSESSING OFFICER. THE ADDIT ION MADE IS, THEREFORE, UPHELD AND THE APPELLANT FAILS ON THE GIVEN GROUNDS OF APPEAL. 4. BEFORE US, LD. COUNSEL FOR THE ASSESSEE REITERAT ED THE SUBMISSIONS MADE BEFORE THE LOWER AUTHORITIES AND SUBMITTED THAT IN THE WRITTEN SUBMISSIONS MADE BEFORE THE LD. CIT(A), IT WAS CLEARLY STATED THE PU RCHASE VOUCHERS ETC. WERE PRODUCED BEFORE THE ASSESSING OFFICER. THEREFORE, THERE WAS NO SCOPE FOR ESTIMATION. HE ALSO INVITED OUR ATTENTION TO PAGE 1 AND 2 AND 3 TO 6 OF THE PAPER BOOK WHICH ARE COPIES OF THE ASSESSMENT ORDER FOR ASSESSMENT YEARS 2005-06 AND 2008-09 BEING THE ASSESSMENTS OF THE A SSESSEE WHICH HAD BEEN 3 FRAMED U/S 143(3) AND NO ADDITION HAVE BEEN MADE ON ACCOUNT OF PROFESSIONAL RECEIPTS. 5. ON THE OTHER HAND, THE LD. DR FOR THE REVENUE SU BMITTED THAT INITIALLY THE ASSESSEE AGREED TO DECLARE INCOME OF RS. 10.00 LAKH S DURING SURVEY WHEREIN CERTAIN LOOSE PAPERS AND DISCREPANCIES WERE FOUND. IN ANY CASE NO SUPPORTING EVIDENCE OR RECEIPT OF THE EXPENDITURE WAS PRODUCED BEFORE THE ASSESSING OFFICER, THEREFORE, THE ADDITION WAS JUSTIFIED. 6. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS CAREFUL LY. IT IS TRUE THAT NO SUPPORTING VOUCHERS FOR EXPENSES OR SUPPORTING EVID ENCE FOR COLLECTION OF FEES FROM PATIENTS WAS PRODUCED BEFORE THE ASSESSING OFF ICER AND IN FACT ONLY THE SUBMISSIONS WAS MADE BEFORE THE LD. CIT(A). MOREOV ER, THE ASSESSEE HAD DEPOSITED CASH AMOUNTING TO RS. 3,89,000/- IN HIS B ANK ACCOUNT WITH H.D.F.C. BANK WHICH CLEARLY SHOWS THAT THE ASSESSEE MUST HAV E GENERATED MORE INCOME. FURTHER, AT THE SAME TIME, IT IS ALSO TRUE THAT NO ADDITION HAS BEEN MADE IN ASSESSMENT YEARS 2005-06 AND 2008-09 EVEN I N THE ASSESSMENTS FRAMED U/S 143(3) OF THE ACT. THEREFORE, CONSIDERI NG THE OVER ALL CIRCUMSTANCES, WE ARE OF THE OPINION THAT ENDS OF J USTICE WOULD BE MET IF NET PROFESSIONAL INCOME IS ESTIMATED AT RS. 5.00 LAKHS. THIS PROPOSAL WAS ACCEPTED BY THE LD. COUNSEL FOR THE ASSESSEE. ACCO RDINGLY WE SET ASIDE THE ORDER OF LD. CIT(A) AND DIRECT THE ASSESSING OFFICE R TO ASSESS THE PROFESSIONAL RECEIPT AT RS. 5.00 LAKHS. 7. IN GROUND NO. 2, AFTER HEARING BOTH THE PARTIES, WE FIND THAT DURING ASSESSMENT PROCEEDINGS THE ASSESSING OFFICER NOTED THAT THE ASSESSEE HAD DEPOSITED CASH IN HIS H.D.F.C BANK ACCOUNT TOTALING TO RS. 11,89,000/-. SINCE NO EXPLANATION WAS GIVEN, THEREFORE, THE ADDITION W AS MADE FOR RS. 11,89,000/-. LATER ON THROUGH RECTIFICATION APPLICATION IT WAS P OINTED OUT THAT THE ASSESSING OFFICER HAS NOTED FIGURES OF RS. 3.00 LAKHS AND RS. 5.00 LAKHS DEPOSITED ON 17.11.2006 AND 24.11.2006 WRONGLY AND NO SUCH DEPOS IT WAS MADE. THIS 4 POSITION WAS ACCEPTED BY THE ASSESSING OFFICER IN T HE ORDER PASSED U/S 154 ON 10.10.2011, COPY OF WHICH IS PLACED AT PAGE 16 TO 1 9 OF THE PAPER BOOK AND ADDITION WAS REDUCED TO RS. 3,89,000/-. 8. BEFORE US, THE LD. COUNSEL FOR THE ASSESSEE SUBM ITTED THAT ONCE PROFESSIONAL RECEIPTS ARE BEING ESTIMATED THEN NO F URTHER ADDITION SHALL BE MADE ON ACCOUNT OF DEPOSIT IN THE BANK. HE ALSO INVITED OUR ATTENTION TO PAGE 9 OF THE PAPER BOOK WHICH IS COPY OF THE COMPUTATION AND POI NTED OUT THAT THE ASSESSEE HAD ALSO DECLARED AGRICULTURAL INCOME OF RS. 1,50,0 00/-. THEREFORE, CONSIDERING HIS AGRICULTURAL INCOME AND EXTRA INCOM E ESTIMATED BY US, NO FURTHER ADDITION SHOULD BE MADE ON ACCOUNT OF CASH DEPOSIT. 9. ON THE OTHER HAND, LD. DR FOR THE REVENUE SUBMI TTED THAT THE ASSESSEE MUST HAVE SPENT MONEY ON HOUSEHOLD EXPENSES AND OTH ER OUT-GOINGS. MOREOVER, BEFORE THE LD. CIT(A) THERE WAS NO CONTEN TION REGARDING AGRICULTURAL INCOME AND THEREFORE, THE ADDITION ON ACCOUNT OF CASH DEPOSIT WAS JUSTIFIED. 10. AFTER CONSIDERING THE RIVAL SUBMISSIONS, WE ARE UNABLE TO AGREE WITH THE SUBMISSIONS OF THE LD. DR FOR THE REVENUE. COMPUTA TION OF INCOME AT PAGE 9 CLEARLY SHOWS THAT THE ASSESSEE HAD OFFERED AGRICUL TURAL INCOME AT RS. 1,50,000/-. MOREOVER, WE HAVE FURTHER ENHANCED PRO FESSIONAL RECEIPTS FROM APPROXIMATELY RS. 2,76,000/- DECLARED BY THE ASSESS EE TO RS. 5.00 LAKHS. THEREFORE, THE SOURCES ARE AVAILABLE OUT OF PROFES SIONAL RECEIPTS OR AGRICULTURAL INCOME AND ACCORDINGLY WE DELETE THE ADDITION IN RE SPECT OF DEPOSITS MADE IN THE BANK. 11. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWE D. ORDER PRONOUNCED ON 25 .04.2012 SD/- SD/- (SUSHMA CHOWLA) (T.R. SOOD) JUDICAL MEMBER ACCOUNTANT MEMBER DATED: 25 .04.2012 SURESH COPY TO: THE APPELLANT/THE RESPONDENT/THE CIT/THE C IT(A)/ THE DR 5