Rangachari Surendhiran, Salem V. ITO Ward 1(2), Salem

ITA 1314/CHNY/2019

• Counselvise Citation: [2022] 104 COUNSELVISE.COM (IT) 0332 (ITAT-CHENNAI)
• Duration Of Justice: 3 year(s) 5 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-10-2022
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 10-10-2022
• Assessment Year: 2015-2016
• Appeal Filed On: 29-04-2019
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Peak credit
• Section: 44AD; 143(3)

Judgement Text

आयकर अपीलीय अिधकरण, ‘ए’ ᭠यायपीठ,चे᳖ई IN THE INCOME TAX APPELLATE TRIBUNAL ‘A’ BENCH, CHENNAI Įी महावीर ͧसंह, उपाÚय¢ एवं Įी मनोज क ु मार अĒवाल, लेखा सदèय के सम¢ BEFORE SHRI MAHAVIR SINGH, VICE PRESIDENTAND SHRI MANOJ KUMAR AGGARWAL, ACCOUNTANT MEMBER आयकरअपीलसं./ITA No.: 1314/CHNY/2019 िनधाᭅरण वषᭅ/Assessment Year: 2015-16 Shri Rangachari Surendhiran, No.111, Manickam Pillai Street, Shevapet, Salem – 636 002. PAN: BCJPS 1546F vs. The Income Tax Officer, Ward-1(2), Salem. (अपीलाथᱮ/Appellant) (ᮧ᭜यथᱮ/Respondent) अपीलाथᱮ कᳱ ओर से/Appellant by : Shri T. Vasudevan, Advocate ᮧ᭜यथᱮ कᳱ ओर से/Respondent by : Shri AR.V.Sreenivasan, Addl.CIT स ु नवाई कȧ तारȣख/Date of Hearing : 11.10.2022 घोषणा कȧ तारȣख/Date of Pronouncement : 19.10.2022 आदेश /O R D E R PER MAHAVIR SINGH, VICE PRESIDENT: This appeal by the assessee is arising out of the order of Commissioner of Income Tax (Appeals), Salem in Appeal No.123/2017-18 dated 26.02.2019. The assessment was framed by the Income Tax Officer, Ward-1(2), Salem for the assessment year 2015-16 u/s. 143(3) of the Income Tax Act, 1961 (hereinafter the ‘Act’) vide order of dated 27.12.2017. 2 ITA No.1314/Chny/2019 2. The only issue in this appeal of assessee is as regards to the order of CIT(A) confirming the addition of peak credit amount of Rs.3,22,763/- as against added by AO at Rs. 10,39,200/- being cash deposit in assessee's bank accounts. For this, assessee has raised various grounds which are argumentative and hence, need not be reproduced. 3. We have heard rival contentions and gone through facts and circumstances of the case. We noted that the AO during the course of assessment proceedings noticed that the assessee has declared income u/s.44AD of the Act from the business of sliver leg chain. The AO has not disturbed the return filed by assessee u/s.44AD of the Act but, he noted that the assessee has made cash deposit in various bank accounts and the total deposit made in the various bank accounts during the period from 01.04.2014 to 31.03.2015 are as under:- Bank Peak Credit of Cash Deposit (a) A/c 915010009724888 of Axis Bank Rs.1433132/- (b) A/c-0311332753 of Kotak Mahindra Bank Rs.1445300/- (c) A/c-911010053609968 of Axis bank Rs.1540304/- (d) A/c-914010038527116 of Axis bank Rs.4041448/- The AO has taken the peak credit of cash deposit of Rs.28,04, 100/- and added to the returned income of the assessee under:- 3 ITA No.1314/Chny/2019 Bank Peak Credit of Cash Deposit (a) A/c 915010009724888 of Axis Bank Rs.755000/- (b) A/c-0311332753 of Kotak Mahindra Bank Rs.1039200/- (c) A/c-911010053609968 of Axis bank Rs.301820/- (d) A/c-914010038527116 of Axis bank Rs.708080/- Total Rs.28,04, 100/- Aggrieved, assessee preferred appeal before the CIT(A). 4. The CIT(A) restricted the addition at Rs.3,22,763/- by observing in paras 6 & 7 as under:- 6. I have considered the assessment order and the written submissions of the appellant. The main contention of the Authorized Representative is that the assessee has offered income u/s 44AD and hence no other additions should be made u/s 69. This argument of the assessee cannot be accepted simply for the reason that the Assessing Officer has made additions based on his investigations during the course of assessment proceedings which revealed that the assessee had 3 more bank accounts which were not disclosed to the Department. He has clearly identified the bank accounts which were not disclosed to the Department and has arrived at the peak credit and assessed the same as unexplained cash u/s 69. During the course of appellate proceedings, the Authorized Representative has produced evidence only with respect to the bank account maintained by the assessee with the Kotak Mahindra Bank. He has further submitted that it may be seen from the bank account submitted that the peak credit was only Rs.3,22,763/- and not Rs.10,39,200/- as adopted by the Assessing Officer in the assessment order. This issue is verified from the bank account submitted and the argument is accepted as correct. Hence, the Assessing officer is directed to substitute the peak credit amount as Rs.3,22,763/- instead of 4 ITA No.1314/Chny/2019 Rs.10,39,200/- Thus the assessee gets a relief of Rs. 7, 16,437/. (Rs. 10,39,200/- - Rs.3,22,763/-). 7. With respect to the other peak credits, the Authorized Representative has simply maintained that the assessee has offered the income in respect of the other bank accounts u/s 44AD and therefore no other addition should be made. This argument of the Authorized Representative does not merit any consideration, as these bank accounts were not disclosed to the Department. In view of the detailed findings of the Assessing Officer in the assessment order, this ground of appeal is partly allowed to the extent discussed supra. Aggrieved, assessee came in appeal before the Tribunal. 5. The only argument of assessee's counsel is that once the assessee has declared income u/s.44AD of the Act, no further addition can be made. On a counter query from the Bench, whether in the bank A/c No.0311332753 of Kotak Mahindra Bank, wherein peak credit addition made by AO of Rs.10,39,200/-out of which the CIT(A) has sustained the addition of Rs.3,22,763/- pertains to the assessee's transactions of business or not, the ld.counsel for the assessee could not answer anything nor could not file any evidence. Once, the assessee could not explain that these cash deposits in Kotak Mahindra Bank account of Rs.10,39,200/- pertains to business transactions, the order of CIT(A) making addition of peak credit and restricting the addition to the extent of Rs.3,22,763/- is 5 ITA No.1314/Chny/2019 as per the provisions of law and hence, we do not interfere in the findings of CIT(A) and hence, the appeal of the assessee is dismissed. 6. In the result, the appeal filed by the assessee is dismissed. Order pronounced in the open court on 19 th October, 2022 at Chennai. Sd/- Sd/- (मनोज कुमार अᮕवाल) (MANOJ KUMAR AGGARWAL) लेखा सद᭭य/ACCOUNTANT MEMBER (महावीर ᳲसह ) (MAHAVIR SINGH) उपा᭟यᭃ /VICE PRESIDENT चे᳖ई/Chennai, ᳰदनांक/Dated, the 19 th October, 2022 RSR आदेशकᳱᮧितिलिपअᮕेिषत/Copy to: 1. अपीलाथᱮ/Appellant 2. ᮧ᭜यथᱮ/Respondent 3. आयकर आयुᲦ (अपील)/CIT(A) 4. आयकर आयुᲦ /CIT 5. िवभागीय ᮧितिनिध/DR 6. गाडᭅ फाईल/GF.