NAVNITKUMAR K KHUNT, SURAT V. ITO, WARD-2(2)(3), SURAT

ITA 125/SRT/2020

• Counselvise Citation: [2022] 104 COUNSELVISE.COM (IT) 0582 (ITAT-SURAT)
• Duration Of Justice: 2 year(s) 3 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-10-2022
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 30-08-2022
• Assessment Year: 2014-2015
• Appeal Filed On: 17-06-2020
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: SURESH K. KABRA
• Keywords: Gift; Business income; Principle of natural justice
• Section: 144; 44AD; 133(6)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, SURAT BENCH, SURAT BEFORE SHRI PAWAN SINGH, JM & DR. A. L. SAINI, AM आयकर अपील सं./ITA No.125/SRT/2020 Ǔनधा[रणवष[/Assessment Year: (2014-15) (Physical Court Hearing) Navnitkumar K. Khunt, 104, Rangavdhut Society - 2, Puna Saroli Road, Punagam, Surat-395010. Vs. The ITO, Ward-2(2)(3), Surat. (Appellant) (Respondent) èथायीलेखासं./जीआइआरसं./PAN/GIR No.: BYXPK1623B Assessee by Shri Suresh K. Kabra, CA Respondent by Shri Vinod Kumar, Sr.DR Date of Hearing 31/08/2022 Date of Pronouncement 17/10/2022 आदेश / O R D E R PER DR. A. L. SAINI, AM: Captioned appeal filed by the assessee, pertaining to Assessment Year (AY) 2014-15, is directed against the order passed by the Learned Commissioner of Income Tax (Appeals)-4, Surat [in short “the ld. CIT(A)”], in Appeal No. CIT(A), Surat-4/10289/2018-19, dated 05.02.2020, which in turn arises out of an order passed by Assessing Officer under section 144 of the Income Tax Act, 1961 (hereinafter referred to as “the Act”), dated 21.11.2016. 2. Grounds of appeal raised by the assessee are as follows: “1. The Ld CIT(A) was not just and proper on the facts of the case and in law in confirming the addition of Rs.8,75,000/- being deposit in Bank.” 3. Succinct facts are that during the course of assessment proceedings, the Assessing Officer wrote letter under section 133(6) of the Act, to the Varachha Co-operative Bank to furnish bank statements in respect of bank accounts held by the assessee in the said bank. Going through the bank account statement of account held by the assessee in Varachha Co-op Bank Account No. 100070063627, it was observed by Assessing Officer that the total credits of the Page | 2 ITA 125/SRT/2020/AY.2014-15 Navnitkumar K. Khunt bank account for the period from 01/04/2013 to 31/03/2014 were Rs.11,70,665/- (including interest credited to bank account). The total cash deposits in above bank account are Rs.11,54,350/-. The Assessing Officer issued show cause notice in this regard dated 31/10/2016. However, the assessee failed to offer any explanation. The Assessing Officer issued another show-cause notice, however assessee did not reply. Since the assessee has failed to offer any explanation with respect to the source of cash deposits of Rs.11,54,350/- in his bank account, therefore, Assessing Officer made addition of Rs.11,54,350/- to the total income of the assessee for the A.Y.2014-15. 4. Aggrieved by the order of Assessing Officer, the assessee carried the matter in appeal before the Ld. CIT(A), who has partly allowed the appeal of the assessee, observing as follows: “7. DISCUSSION AND DECISION OF THE APPELLATE AUTHORITY 7.1 Submission of the appellant, Remand Report and assessment order have been considered carefully. In this case only one addition of Rs.11,54,350/- is made on account of unexplained cash deposit during the year under consideration. Facts of the case in brief are that ample opportunities have been provided to the assessee in order to give natural justice. Primary onus was on the appellant and the appellant is at liberty to discharge such primary onus but the appellant had failed to discharge its onus. However, looking to the non co-operative and recalcitrant approach towards the assessment proceedings of the appellant, the assessment proceedings has been completed u/s. 144 of the I.T. Act & AO made addition of entire cash deposits of Rs.11,54,350/- during the year consideration. The additional evidences produced by the appellant are admitted for the reason given in his submission for non-production of the same before the AO. I found the reason given by the appellant as reasonable, hence additional evidences are admitted. Regarding the cash deposit in bank a/c, the appellant submitted that it is shown in cash book of R.4 Lakh has been shown as gift from father and rest are shown as business receipts. The appellant deposited Rs.8,75,000/- on 14.03.2014 is in single entry but source of the same could not be explained. Hence addition of Rs.8,75,000/- are confirmed and remaining are deleted. This ground of appeal partly allowed.” 5. Shri Suresh K. Kabra, the Learned Counsel for the assessee argued that assessee is a small trader and files its return of income under section 44AD of the Act. The Ld. Counsel submitted that the assessee has submitted additional evidences during the appellate proceedings and Ld. CIT(A) has considered the same and allowed the part relief, however the Ld. CIT(A) did not allow the amount which is received by assessee from his father out of agricultural income Page | 3 ITA 125/SRT/2020/AY.2014-15 Navnitkumar K. Khunt and business receipts. The Ld. Counsel took us through the paper book page no. 1 wherein summary of cash is mentioned and contended that assessee has explained the cash deposits with sufficient evidences. 6. On the other hand, Learned Departmental Representative (Ld. DR) for the Revenue submitted that assessee did not produce the cash record before the lower authority and cash on hand on 01.04.2013 to the tune of Rs.3,31,283/- has also not been submitted before the lower authority. He further stated that other entries which is explained by the assessee in the cash summary is not reliable, as the assessee sold the machinery but there is no working about the capital gain or loss on account of sale machinery, therefore such evidences should not be relied. This way, Ld. DR contended that addition made by Assessing Officer may be sustained. 7. We have heard both the parties and carefully gone through the submissions put forth on behalf of the assessee along with the documents furnished and the case laws relied upon, and perused the facts of the case including the findings of the ld. CIT(A) and other material brought on record. We note that before us assessee has submitted the explanation with respect to Rs.11,54,350/- cash deposited in the bank account and the said explanation is placed at paper book page no.1 which is reproduced below: Page | 4 ITA 125/SRT/2020/AY.2014-15 Navnitkumar K. Khunt 8. We note that assessee has submitted the cash deposit summary before the lower authorities. The proof of amount received from his father as a gift to the tune of Rs.4,00,000/- is placed at paper book page nos. 30 to 36. The assessee has business receipts from Kishorbhai Sheladiya to the tune of Rs.1,83,200/- which is placed at paper book page no.10. The assessee has received business receipts from Bramani Fashion to the tune of Rs.37,980/-. The assessee also received business receipts to the tune of Rs.1,02,220/- which is placed at paper book page no.19. The assessee has withdrawn cash on 20.03.2014. This way the assessee has explained the cash deposit to the tune of Rs.8,75,000/-. We note that all the evidences pertaining to this cash receipts have been furnished before the lower authorities and they did not point out any defects in the evidences and the documents submitted by the assessee. We note that Ld. CIT(A) has not refuted or discredited these evidences and documents submitted by the assessee. The Ld. CIT(A) did not mention in his order that why he is not accepting these evidences submitted by assessee. It is a well-settled law that when an assessee has all the possible evidence in support of its claim, they cannot be brushed aside based on surmises. Hence, we delete the addition sustained by ld. CIT(A). 9. In the result, the appeal filed by the assessee is allowed. Order is pronounced on 17/10/2022 by placing the result on the Notice Board. Sd/- Sd/- (PAWAN SINGH) (Dr. A.L. SAINI) JUDICIAL MEMBER ACCOUNTANT MEMBER lwjr /Surat Ǒदनांक/ Date: 17/10/2022 SAMANTA Copy of the Order forwarded to 1. The Assessee 2. The Respondent 3. The CIT(A) 4. CIT 5. DR/AR, ITAT, Surat 6. Guard File By Order // TRUE COPY // Assistant Registrar/Sr. PS/PS ITAT, Surat