Income Tax Officer-4(2), Lucknow V. Shri Jitendra Kumar Srivastava, Lucknow

ITA 148/LKW/2012

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 83450 (ITAT-LUCKNOW)
• Duration Of Justice: 2 year(s) 8 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-12-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 21-10-2014
• Assessment Year: 2008-2009
• Appeal Filed On: 26-03-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Business income

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH A, LUCKNOW BEFORE SHRI SUNIL KUMAR YADAV, JUDICIAL MEMBER AND SHRI A.K. GARODIA, ACCOUNTANT MEMBER ITA NO.148/LKW/2012 ASSESSMENT YEAR:2008 - 09 SHRI JITENDRA KUMAR SRIVASTAVA, 538/K/406, SITAPUR ROAD, (NEAR SINGH TIMBER) TRIVENI NAGAR, LUCKNOW. PAN:ALUPS0168G VS INCOME TAX OFFICER - 4(2), LUCKNOW. (RESPONDENT) (APPELLANT) SHRI AMIT NIGAM, D. R. APPELLANT BY SHRI K. R. RASTOGI, C. A. SHRI SHUBHAM RASTOGI, C. A. RESPONDENT BY 21/10/2014 DATE OF HEARING 10 /12/2014 DATE OF PRONOUNCEMENT O R D E R PER A. K. GARODIA, A.M. THIS IS REVENUES APPEAL DIRECTED AGAINST THE ORDER PASSED BY LEARNED CIT(A) - II, LUCKNOW DATED 13/02/2012 FOR THE ASSESSMENT YEAR 2008 - 2009. 2. THE GROUNDS RAISED BY THE REVENUE ARE AS UNDER: 1. THE CIT(A) HAS ERRED IN LAW AND ON FACTS OF THE CASE IN FAILING TO APPRECIATE THAT THE A.O. HAD RIGHTLY MADE AN ADDITION OF RS.15,22,488/ - TO THE ASSESSEE INCOME AS THE ASSESSEE DID NOT COOPERATE AND EXPLAIN THE CREDIT ENTRIES IN HIS BANK ACCOUNT, IN SPITE OF THE SUFFICIENT OPPORTUNITY GIVEN TO HIM. 2. THE CIT(A) HAS ERRED IN LAW AND ON FACTS OF THE CASE IN FAILING TO APPRECIATE THAT THE ASSESSEE CLAIM MADE BEFORE THE CIT(A) THAT THE SE ARE BUSINESS RECEIPT CANNOT NOT BE ACCEPTED AS HE FAILED TO PRODUCE THE NAME AND ADDRESSES OF THE PERSONS FROM WHOM THE CASH WAS RECEIVED. 2 3. THE CIT(A) HAS ERRED IN LAW AND ON FACTS OF THE CASE IN DELETING THE DISALLOWANCES MADE BY THE AO OF RS.4,00,7 59/ - OUT OF EXPENSES CLAIM AS NO BOOKS OF ACCOUNT WERE PRODUCED AND THE CLAIM OF THE ASSESSEE COULD NOT BE VERIFIED. 3. LEARNED D.R. OF THE REVENUE SUPPORTED THE ASSESSMENT ORDER WHEREAS LEARNED A.R. OF THE ASSESSEE SUPPORTED THE ORDER OF LEARNED CIT(A). 4. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. T HE ISSUE INVOLVED IN GROUND NO. 1 AND 2 IS DECIDED BY LEARNED CIT(A) AS PER PARA 4(5) AND 4(6) OF HIS ORDER, WHICH IS REPRODUCED BELOW FOR THE SAKE OF READY REFERENCE: - 4(5) I HAVE EXAMINED THE FACTS AND CIRCUMSTANCES OF THE CASE. I HAVE GONE THROUGH THE FINDINGS OF THE AO IN THE ASSESSMENT ORDER AND IN HIS REMAND REPORT. I HAVE ALSO CONSIDERED THE SUBMISSIONS OF THE APPELLANT. THE APPELLANT IS ENGAGED IN THE BUSINESS OF TOURS AND TRAVELS I.E. PURCHASE AND SALE OF AIR TICKET ON COMMISSION BASIS AND RUNNING OF TAXI ON COMMISSION BASIS AND HIRING CHARGES OF TAXIS. THAT ASSESSEE WAS MAINTAINING HIS SAVING BANK ACCOUNT NO. 52019609925 IN STATE BANK OF HYDERABAD, SAPRU MARG, LUCNKOW, FOR BUSINESS PURPOSES. TOTAL CASH DEPOSITS IN THE BANK ACCOUNT ARE RS.15,22,488/ - FOR WHICH ADDITION HAS BEEN MADE BY THE AO. IN THIS BANK ACCOUNT BUSINESS RECEIPTS WERE CREDITED AND PAYMENTS WERE MADE TOWARDS BUSINESS PURPOSES. FURTHER MOST OF PAYMENTS WERE MADE THROUGH CHEQUE TO DI FFERENT TRAVELS AGENCY FOR ACQUISITION OF AIR TICKETS. OUT OF BUSINESS RECEIPTS, RS.8,99,861/ - WERE MADE TO HEENA AIRWAYS AND EVES TOURS AND TRAVELS. AS PER NATURE OF BUSINESS THE ONLY COMMISSION IS BUSINESS RECEIPTS OF ASSESSEE NOT THE WHOLE AMOUNT OF SAL E VALUE OF AIR TICKETS. IT CAN THEREFORE BE SAID THAT OUT OF BUSINESS RECEIPTS OF RS.15,22,488/ - , THE COMMISSIONS AND BOOKING INCOME OF RS.5,56,792/ - HAS BEEN SHOWN BY THE ASSESSEE IN THE PROFIT AND LOSS ACCOUNT FOR THE PERIOD ENDED ON 31.03.2008 RELEVANT TO THE ASSESSMENT YEAR UNDER CONSIDERATION. 4(6) THE AO IN HIS REMAND REPORT HAS ACCEPTED THAT THE BANK ACCOUNT WAS MAINTAINED FOR BUSINESS PURPOSES. I AM THEREFORE OF THE CONSIDERED VIEW THAT THE TRANSACTIONS IN THE BANK ACCOUNT ARE BUSINESS TRANSACTIONS WHICH HAVE BEEN DULY ACCOUNTED FOR IN THE 3 PROFIT AND LOSS ACCOUNT FOR THE PERIOD ENDED ON 31/03/2008 RELEVANT TO THE ASSESSMENT YEAR UNDER CONSIDERATION. I AM NOT INCLINED TO AGREE WITH THE CONTENTION OF THE ASSESSING OFFICER THAT A SUITABLE PERCENTAGE OF PROFIT SHOULD BE APPLIED AS NO SPECIFIC DISCREPA NCY HAS BEEN POINTED OUT BY THE AO IN THE REMAND REPORT. FURTHER, THE ASSESSEE HAS SHOWN GROSS RECEIPTS OF RS. 5 ,56,792/ - WHICH IS ABOUT 36.5% OF THE CASH DEPOSITS OF RS.15,22,488 / - IN THE BANK ACCOUNT. ACCORDINGLY, THE ADDITION OF RS.15,22,488/ - MADE BY TH E AO IS DIRECTED TO BE DELETED GIVING EQUIVALENT RELIEF TO THE APPELLANT. T H E GROUNDS OF APPEAL NUMBERS 1 AND 2 ARE ALLOWED. 4.1 FROM THE ABOVE PARA FROM THE ORDER OF CIT(A), WE FIND THAT A CLEAR FINDING IS GIVEN BY HIM THAT THESE DEPOSITS OF RS.15,22,48 8/ - IN THE BANK ACCOUNT OF THE ASSESSEE IN CASH IS HELD TO BE ON ACCOUNT OF BUSINESS RECEIPTS AND OUT OF THIS , THE ASSESSEE HAS SHOWN AN INCOME OF RS.5,56,792/ - WHICH IS ABOUT 36.5% OF SUCH CASH DEPOSIT IN BANK. ON THIS BASIS, THIS ADDITION, MADE BY THE A SSESSING OFFICER, HAS BEEN DELETED BY THE CIT(A). THESE FINDINGS OF CIT(A) COULD NOT BE CONTROVERTED BY LEARNED D.R. OF THE REVENUE. WHEN THE RECEIPTS ARE ACCEPTED TO BE BUSINESS RECEIPTS AND REASONABLE INCOME HAS ALREADY BEEN DECLARED BY THE ASSESSEE AG AINST THESE RECEIPTS, WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF CIT(A) ON THIS ISSUE. GROUND NO. 1 IS REJECTED. 5. THE ISSUE IN GROUND NO. 3 HAS BEEN DECIDED BY LEARNED CIT(A) AS PER PARA 5(3) OF HIS ORDER, WHICH IS REPRODUCED BELOW FOR THE SAKE OF REA DY REFERENCE: - 5(3) I HAVE EXAMINED THE FACTS AND CIRCUMSTANCES OF THE CASE. I FIND THAT THE AO HAS DISALLOWED ALL THE EXPENSES CLAIMED BY THE ASSESSEE WITHOUT FINDING ANY DISCREPANCY THEREIN AND WITHOUT POINTING OUT ANY INSTANCE OF DISALLOWABLE EXPENDITURE UNDER THE PROVISIONS OF THE ACT. THE SUBMISSIONS OF THE ASSESSEE ALONG WITH THE EVIDENCES WERE FORWARDED TO THE ASSESSING OFFICER AND A REMAND REPORT WAS CALLED FOR. IN THE REMAND REPORT ALSO NO SUCH SPECIFIC FINDING HAS BEEN GIVEN. I FIND THAT THE EXPENSES CLAIMED ARE ROUTINE EXPENSES INCURRED FOR THE PURPOSE OF BUSINESS. THE DISALLOWANCE OF EXPENSES MADE BY THE AO IS NOT CALLED FOR. THE DISALLOWANCE OF RS.4,00,759 / - MADE BY THE AO IS DIRECTED TO BE 4 DELETED GIVING CONSEQUENTIAL RELIEF TO THE AS SESSEE. THE GROUND OF APPEAL IS ALLOWED. 5.1 FROM THE ABOVE PARA , IT IS SEEN THAT A CLEAR FINDING IS GIVEN BY CIT(A) THAT THE EXPENSES CLAIMED ARE ROUTINE EXPENSES INCURRED FOR THE PURPOSE OF BUSINESS AND THE ENTIRE EXPENSES WERE DISALLOWED BY ASSESSING OFFICER WITHOUT FINDING ANY DISCREPANCY THEREIN. HE HAS ALSO GIVEN A FINDING THAT EVEN IN THE REMAND REPORT ALSO , NO SUCH SPECIFIC FINDING HAS BEEN GIVEN BY THE ASSESSING OFFICER. ON THE BASIS OF THESE FINDINGS, THIS DISALLOWANCE WAS DELETED BY CIT(A) AN D CONSIDERING THE ENTIRE FACTS OF THE CASE, WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF CIT(A) ON THIS ISSUE ALSO. THIS ISSUE IS ALSO DECIDED IN FAVOUR OF THE ASSESSEE. GROUND NO. 3 IS ALSO REJECTED. 6. REGARDING GROUND NO. 2 OF THE APPEAL, WE FIND THAT NO SEPARATE ADJUDICATION IS CALLED FOR. 7. IN THE RESULT, THE APPEAL OF THE REVENUE STANDS DISMISSED. (ORDER WAS PRONOUNCED IN THE OPEN COURT ON THE DATE MENTIONED ON THE CAPTION PAGE) SD/. SD/. (SUNIL KUMAR YADAV) ( A. K. GARODIA ) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 10 /12/2014. *C.L.SINGH COPY OF THE ORDER FORWARDED TO : 1.THE APPELLANT 2.THE RESPONDENT. 3.CONCERNED CIT 4.THE CIT(A) 5.D.R., I.T.A.T., LUCKNOW ASSTT. REGISTRAR