Sri Login Das, Dakshin Dinajpur V. ITO, WD-3(4), BALURGHAT, Dakshin Dinajpur

ITA 1481/KOL/2015

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 4201 (ITAT-KOLKATA)
• Duration Of Justice: 11 month(s) 10 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-11-2016
• Appeal Filed By: Assessee
• Bench Allotted: SMC
• Next Hearing Date: 07-11-2016
• Assessment Year: 2010-2011
• Appeal Filed On: 15-12-2015
• Court: TRIBUNAL
• Department Lawyers: DEBASISH BANERJEE
• Keywords: Peak credit
• Section: 44AD; 143(3); 234B; 133(6); 69

Judgement Text

1 ITA NO.1481/KOL/2015 LOGIN DAS, AY 2010-11 IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH: KOL KATA [BEFORE SHRI M. BALAGANESH, AM & SHRI S. S. VISWAN ETHRA RAVI, JM] I.T.A NO. 1481/KOL/2015 ASSESSMENT YEAR: 2010-11 SRI LOGIN DAS (PAN: AKPPD8730P) VS. INCOME-TAX OFF ICER, WD-3(4), BALURGHAT ( APPELLANT ) ( RESPONDENT ) DATE OF HEARING: 07.11.2016 DATE OF PRONOUNCEMENT: 25.11.2016 FOR THE APPELLANT: SHRI SOUMITRA CHOUDHURY, AD VOCATE FOR THE RESPONDENT: SHRI DEBASISH BANERJEE, JC IT ORDER PER SHRI M. BALAGANESH, AM: THIS APPEAL BY ASSESSEE IS ARISING OUT OF ORDER OF CIT(A), JALPAIGURI VIDE APPEAL NO. 301/JAL/CIT(A)/JAL/2013-14 DATED 12.10.2015. ASSESS MENT WAS FRAMED BY ITO, WARD-1, BALURGHAT U/S. 143(3) OF THE INCOME TAX ACT, 1961 ( HEREINAFTER REFERRED TO AS THE ACT) FOR AY 2010-11 VIDE HIS ORDER DATED 28.01.2014. 2. THE ASSESSEE HAD RAISED THE FOLLOWING GROUNDS O F APPEAL :- 1. FOR THAT ON THE FACTS OF THE CASE, THE ORDER O F THE LD. C.I.T.(A) IS COMPLETELY ARBITRARY, UNJUSTIFIED AND ILLEGAL. 2. FOR THAT ON THE FACTS OF THE CASE THE LD. CIT(A) WAS WRONG IN DITTOING THE ORDER OF THE A.O. AND CONFIRMING THE ADDITION OF RS.31,30,891/- ON AC COUNT OF UNDISCLOSED INVESTMENT IN BANK U/S. 69 OF THE I. T. ACT WHICH IS COMPLETELY ARBITR ARY UNJUSTIFIED AND ILLEGAL AND SHOULD BE DELETED. 3. FOR THAT ON THE FACTS OF THE CASE, THE SOURCE OF CREDIT IN ICICI BANK WERE OUT OF REGULAR BANK ACCOUNT AND RECEIVED DONATION FOR RENDERING SE RVICE TO THE AILING PEOPLE AND THE PEAK CREDIT ARRIVED AT RS.28,09,391/- WAS EXPLAINED AS A BOVE, THEREFORE, THE FINDING OF THE LD. C.I.T.(A) IS BASED ON PRESUMPTION AND CONJECTURE AN D SHOULD BE DELETED. 4. FOR THAT ON THE FACTS OF THE CASE THE LD. CIT(A) WAS WRONG IN DITTOING THE ORDER OF THE A.O. AND CONFIRMING THE ADDITION OF RS.3,21,500/-, @ 8% OF TOTAL TRANSACTION OF RS.3,21,500/- THEREFORE, ESTIMATED BEING TAXED ONCE AGAIN U/S. 44 AD WHICH IS COMPLETELY ARBITRARY UNJUSTIFIED AND ILLEGAL. 5. FOR THAT ON THE FACTS OF THE CASE THE LD. CIT(A) WAS WRONG IN ENHANCING THE ASSESSMENT WITHOUT GIVING REASONABLE AND PROPER OPPORTUNITY OF HEARING WHICH IS COMPLETELY ARBITRARY, UNJUSTIFIED AND ILLEGAL. 2 ITA NO.1481/KOL/2015 LOGIN DAS, AY 2010-11 6. FOR THAT ON THE FACTS OF THE CASE THE LD. CIT(A) WAS WRONG IN ENHANCING THE ASSESSMENT BY ADDING RS.40,18,760/- AS UNDISCLOSED INVESTMENT U/S .69 OF THE I.T. ACT WHICH IS COMPLETELY ARBITRARY UNJUSTIFIED AND ILLEGAL AND SHOULD BE DEL ETED. 7. FOR THAT ON THE FACTS OF THE CASE THE LD. CIT(A) WAS WRONG IN ENHANCING THE ASSESSMENT BY ADDING RS.15,999/- ON ACCOUNT OF BANK INTEREST WHIC H IS COMPLETELY ARBITRARY UNJUSTIFIED AND ILLEGAL. 8. FOR THAT THE INTEREST U/S. 234A & 234B CHARGED M ECHANICALLY IS WRONG & ILLEGAL. 3. THE BRIEF FACTS OF THIS APPEAL ARE THAT THE ASS ESSEE IS A PETTY CONTRACTOR AND ALSO AN ELECTED MEMBER (PRADHAN) OF VATPARA GRAM PANCHAYAT, VILL, VATPARA P.O, BALURGHAT DISTRICT, DAKSHIN DINAJPUR. THE LD AO OBSERVED THA T THE ASSESSEE WAS MAINTAINING A BANK ACCOUNT WITH ICICI BANK, BALURGHAT BRANCH, BALURGHA T, DAKSHIN DINAJPUR VIDE SB ACCOUNT NO. 089601501526. NOTICE U/S 133(6) OF THE ACT WAS ISSUED ON THE SAID BANK AND BANK HAD SUBMITTED THE BANK STATEMENT OF THE ASSESSEE BEFORE THE LD AO. FROM THE SAME, THE LD AO OBSERVED THE TOTAL DEPOSITS IN THE SAID BANK ACCOUN T WORKED OUT TO RS. 40,18,760/-. THE LD AO FOUND THAT HAD THIS BANK ACCOUNT BEEN CONSIDERED BY THE ASSESSEE, THEN HIS INCOME WOULD HAVE INCREASED BY RS. 3,21,500/- I.E AT 8% OF RS. 40,18,760/- U/S 44AD OF THE ACT. APART FROM THIS, THE LD AO OBSERVED THAT THERE WAS A BANK INTEREST CREDITED IN THE SAID BANK ACCOUNT TO THE TUNE OF RS. 15,999/- WHICH WAS ALSO TO BE BROUGHT TO TAX SEPARATELY IN THE HANDS OF THE ASSESSEE. THE LD AO SHOW CAUSED THE ASSESSEE AS TO WHY THE PEAK CREDIT OF RS. 28,09,391/- SHOULD NOT BE ADDED TO HIS TOTAL INCOME IN RESPECT OF THE SAID BANK ACCOUNT. 3.1. THE ASSESSEE REPLIED THAT HE IS A POLITICAL P ERSON AND A VILLAGE REPRESENTATIVE OF A RECOGNIZED POLITICAL PARTY AND AS AN ELECTED VILLAG E REPRESENTATIVE, HE HAD TO LOOK AFTER LEGION OF VOTERS WHO LIVE BELOW THE POVERTY LINE. IN THAT PROCESS, CERTAIN AMOUNTS WERE COLLECTED FROM THE FRIENDS AND RELATIVES AND KNOWN PERSONS FOR RENDERING SERVICES TO THE AILING PEOPLE. IT WAS CATEGORICALLY STATED THAT T HESE AMOUNTS WERE NOT USED BY THE ASSESSEE FOR HIS OWN BUSINESS PURPOSES OR FOR HIS PERSONAL B ENEFIT AND WERE BANKED IN A SEPARATE BANK ACCOUNT OPENED FOR THIS PURPOSE. THE ASSESSEE STAT ED THAT THESE FUNDS WERE NEVER PART OF HIS REGULAR BUSINESS AND HENCE THE ADDITION TOWARDS PEA K CREDIT COULD NOT BE MADE. THE LD AO ALSO NOTICED FROM THE SAID BANK ACCOUNT THAT PAYMEN TS WERE MADE TO THE TUNE OF RS. 1,09,260/- FOR PURCHASE OF PURE GOLD FROM ICICI BAN K . IF THE TRANSACTIONS IN THE SAID BANK ACCOUNT BELONG TO A POLITICAL PARTY, THEN WHERE IS THE NEED TO BUY PURE GOLD WHICH WOULD ANY WAY NOT BE RELEVANT FOR ANY POLITICAL PARTY. BESI DES, THE LD AO OBSERVED FROM THE SAID BANK 3 ITA NO.1481/KOL/2015 LOGIN DAS, AY 2010-11 STATEMENT, THE NAMES OF THREE PERSONS VIZ RANA TALU KDAR, SURAJIT MALLICK AND AMIT KUMAR DUTTA , WHO HAD MADE WITHDRAWALS IN CASH FROM THE S AID BANK ACCOUNT. ON EXAMINATION ON OATH BY THE LD AO, THOSE THREE PERSONS HAD STATED T HAT THE CASH WAS WITHDRAWN FROM THE SAID BANK ACCOUNT AND HANDED OVER TO THE CASHIER OF TMC PARTY IN REPLY TO QUESTION NO. 5 AND IN REPLY TO QUESTION NO.6, THEY RESPONDED THAT THE CAS H WAS HANDED OVER TO THE ASSESSEE. BASED ON THESE OBSERVATIONS, THE LD AO OBSERVED THA T THE ASSESSEE WAS NOT ABLE TO PROVE THE SOURCE OF CASH DEPOSITS IN THE SAID BANK ACCOUNT AN D ACCORDINGLY BROUGHT THE PEAK CREDIT OF THE BALANCE TO TAX AS UNDISCLOSED INCOME OF THE ASS ESSEE. 4. BEFORE THE LD CITA , THE ASSESSEE STATED THAT T HE LD AO HAD NOT APPRECIATED THE SUBMISSIONS OF THE ASSESSEE THAT HE HAD COLLECTED D ONATIONS FROM SEVERAL PERSONS FOR RENDERING SERVICE TO THE AILING PEOPLE AND HE HAD K EPT THE MONEY IN ICICI BANK FOR SAFEGUARD AND HAD NEVER USED THE FUNDS FOR HIS PERS ONAL / BUSINESS PURPOSES. HE FILED THE DETAILS OF DONATIONS RECEIVED BEFORE THE LD CITA TO SUBSTANTIATE THE CONTENTION. THE ASSESSEE ALSO SUBMITTED COPY OF RESOLUTIONS DATED 10.11.2010 BY THE ELECTED MEMBER OF THE BLOCK COMMITTEE TO THE EFFECT THAT THE AMOUNT SO COLLECTE D BE KEPT IN THE PERSONAL BANK ACCOUNT OF THE ASSESSEE MAINTAINED IN THE ICICI BANK, BALURGHA T TILL THE TIME OF OPENING A BANK ACCOUNT OF BLOCK COMMITTEE OF ITS OWN EXCLUSIVELY FOR THE P URPOSE OF SAFETY AND SECURITY. THE ASSESSEE ALSO PRODUCED THE ACCOUNT OF BALURGHAT BLO CK TRINAMOOL CONGRESS FOR THE PERIOD UNDER APPEAL WHERE ALL THE DETAILS OF DONATION AND BANK ACCOUNTS WERE DULY REFLECTED. ACCORDINGLY, IT WAS PLEADED THAT THERE IS NO QUESTI ON OF ADDING PEAK CREDITS (RS.28,09,391/-) ON THE MONIES BELONGING TO A POLIT ICAL PARTY AND PROFIT THEREON @ 8% OF THE TOTAL CREDITS (RS. 3,21,500/-) TREATING THE SAME AS BUSINESS TRANSACTIONS OF THE ASSESSEE AND BY DISBELIEVING THE POLITICAL STATUS OF THE ASSESSE E TOGETHER WITH THE DOCUMENTS AVAILABLE ON RECORD IN SUPPORT THEREOF. 4.1. THE LD CITA CALLED FOR A REMAND REPORT FROM T HE LD AO IN RESPECT OF THESE EVIDENCES FILED BY THE ASSESSEE. THE LD AO FURNISHED THE RE MAND REPORT DATED 15.7.2015 WHEREIN HE STATED AS UNDER ;- THE A/R OF THE ASSESSEE HAS STATED THAT FUNDS WHI CH ARE LYING IN ICICI BANK, BALURGHAT ACTUALLY BELONGS TO 'BALURGHAT BLOCK TRINAMOOL CONG RESS' AND IN SUPPORT OF HIS CLAIM HE HAS PRODUCED THE FOLLOWING DOCUMENTS IN ORIGINAL WHICH WERE PRODUCED BEFORE YOU FIRST TIME AT THE TIME OF APPELLATE PROCEEDINGS. 4 ITA NO.1481/KOL/2015 LOGIN DAS, AY 2010-11 I. RESOLUTIONS DATED 05/11/2010,10/11/2010,25/03/20 12 & 15/05/2013. 2. DONATION RECEIPTS, 3. ACCOUNTS OF BALURGHAT BLOCK TRINAMOOL CONGRESS A ND 4. STATEMENT OF ICICI BANK ACCOUNT. 5. IDENTITY CARD OF LOIN DAS AS THE PRADHAN OF NO.5 , BHATPARA GRAM PANCHAYAT WHICH ISSUED BY THE DISTRICT MAGISTRATE, DAKSHIN DINAJPUR . IT MAY BE MENTIONED HERE THAT ALL THE ABOVE DOCUMEN TS WERE NEVER PRODUCED AT THE TIME OF ASSESSMENT PROCEEDINGS. BUT, HOWEVER, ALL THE DOCUM ENTS AND EVIDENCES WERE PRODUCED BEFORE YOU. AS REGARD CASH WITHDRAWAL FROM TIME TO TIME, THE A/ R OF THE ASSESSEE HAD PRODUCE THE FOLLOWINGS 3 PERSONS ON 14.07.2015 TO RECORD THEIR STATEMENT. 1. SURAJIT MALLOK, SAHEB KACHARIPARA, BALURGHAT, DA KHIN DINAJPUR, I 2. RANA TALUKDAR, CONGRESS PARA, BALURGHAT, DAKHIN DINAJPUR AND 3. ARNIT KUMAR DUTTA, SAHEB KACHARIPARA, BALURGHAT, DAKHIN DINAJPUR. THE STATEMENTS OF THE AFORESAID THREE PERSONS HAVE DULY BEEN RECORDED AND THE COPIES OF WHICH ARE ENCLOSED HEREWITH FOR FAVOUR OF YOUR KIND PERUS AL. FURTHERMORE, THE ASSESSEE IS A POLITICAL PERSON AND A DESIGNATED MEMBER OF THE PARTY. THE A/R. OF THE ASSESSEE HAS ALSO PRODUCED BEFORE ME THE ORI GINAL DONATION RECEIPTS AND THE LEDGER ACCOUNT OF THE BATURGHAT BLOCK TRINAMOOL CONGRESS F OR THE PERIOD UNDER CONSIDERATION WHERE ALL THE DEPOSITS OF DONATIONS HAVE DULY BEEN REFLE CTED IN THE BANK STATEMENT. ON QUERY ABOUT THE REASONS FOR THE CASH DEPOSITS IN SAVINGS BANK ACCOU NT OF THE ASSESSEE ON BEHALF OF THE BALURGHAT BLOCK TRINAMOOL CONGRESS PARTY, THE A/R O F THE ASSESSEE PRODUCED THE RESOLUTION PASSED ON 10.11.2010 BY THE ELECTED MEMBERS OF THE BLOCK COMMITTEE IN THIS MATTER. AS PER THE RESOLUTION, IT IS SEEN THAT THE ASSESSEE WHO WAS ALSO GENERAL SECRETARY OF TRINAMOOL CONGRESS COMMITTEE, BALURGHAT BLOCK HAD BEEN SELF-A UTHORIZED TO DEPOSITS THE FUNDS OF BALURGHAT BLOCK TRINAMOOL CONGRESS IN HIS SAVINGS A CCOUNT BEARING NO.089601501526 MAINTAINED AT ICICI BANK, BALURGHAT. THIS IS FOR YOUR KIND INFORMATION. 4.2. THE LD CITA OBSERVED THAT THE ASSESSEE HAD DU RING THE COURSE OF ASSESSMENT PROCEEDINGS HAD STATED THAT HE BEING AN ELECTED VIL LAGE REPRESENTATIVE COLLECTED SMALL SUBSCRIPTION FROM HIS FRIENDS, RELATIVES AND KNOWN PERSONS FOR RENDERING SERVICES TO THE AILING PEOPLE. IN THE SECOND SUBMISSION DATED 12.3 .2015, HE STATED THAT A RESOLUTION WAS PASSED BY THE ELECTED MEMBERS OF THE BLOCK COMMITTE E ON 10.11.2010 , IN WHICH IT WAS DECIDED THAT THE AMOUNT SO COLLECTED BY ASSESSEE WO ULD BE KEPT IN HIS PERSONAL BANK ACCOUNT WITH THE ICICI BANK TILL THE TIME OF OPENING A BA NK ACCOUNT OF BLOCK COMMITTEE. HE QUESTIONED THE VERACITY OF THE SAID RESOLUTION AS T O WHY THE SAME WAS NOT PRODUCED BY THE ASSESSEE DURING THE ORIGINAL ASSESSMENT PROCEEDINGS . HE STATED THAT THE SO CALLED RESOLUTION 5 ITA NO.1481/KOL/2015 LOGIN DAS, AY 2010-11 WAS PASSED STATING THAT THE DONATION WOULD BE KEPT IN ASSESSEES PERSONAL BANK ACCOUNT UNTIL OPENING OF A BANK ACCOUNT BY THE BLOCK COMMITTEE. H E STATED THAT HOW A RESOLUTION COULD BE PASSED BY THE BLOCK COMMITTEE ANTICIPATING FUTUR E RECEIPTS OF CASH DONATIONS AND EVEN THE SAME WAS PASSED THEN WHY A BANK ACCOUNT WAS NOT OPENED IN THE NAME OF BLOCK COMMITTEE IMMEDIATELY AFTER THE DATE OF PASSING THE RESOLUTION. ACCORDINGLY, THE LD CITA CONCLUDED THAT HE DOES NOT FIND ANY IOTA OF MERIT I N THE TWO SUBMISSIONS OF THE ASSESSEE DISCUSSED HEREINABOVE. 4.2.1. FURTHER HE OBSERVED THAT THE REMAND REPORT S ENT BY THE LD AO SUFFERS FROM MANY DEFICIENCIES. THE LD CITA FELT THAT THE LD AO HAD N OT MADE ANY ENQUIRIES WITH REGARD TO THE CASH DEPOSITS AND TO ASCERTAIN THE FACTS OF THE CAS E IN PROPER PERSPECTIVE AND HAD RECORDED THE STATEMENT FROM THREE PERSONS (PARTY WORKERS) IN SLIPSHOD AND PERFUNCTORY MANNER. ACCORDINGLY, HE CONCLUDED THAT THE REMAND REPORT SE NT BY THE LD AO CANNOT BE TAKEN INTO COGNIZANCE. THE LD CITA ACCORDINGLY PROCEEDED TO TREAT THE ENTIRE CREDITS IN THE SUBJECT MENTIONED BANK ACCOUNT AS UNDISCLOSED INCOME OF TH E ASSESSEE AS AGAINST THE PEAK CREDIT ADDED BY THE LD AO THEREON. FOR THIS PURPOSE, HE ISSUED AN ENHANCEMENT NOTICE TO THE ASSESSEE TO THIS EFFECT. THE ASSESSEE REPLIED BEFOR E THE LD CITA STATING THAT THE TRANSACTIONS IN THE SAID ICICI BANK ACCOUNT ONLY BELONG TO THE T MC PARTY AND THE DONATIONS COLLECTED IN CASH FROM 467 DONORS RANGING FROM RS. 2000 TO RS 95 00 WERE PERTAINING TO THE SAID PARTY ONLY AND THE MONIES COLLECTED WERE ONLY DEPOSITED I N THE BANK ACCOUNT OF THE ASSESSEE AS A CUSTODIAN AS A RESPONSIBLE OFFICE BEARER OF THE POL ITICAL PARTY. IT WAS ALSO OBJECTED THAT THE TRANSACTIONS IN THE SAID BANK ACCOUNT BELONGS ONLY TO THE POLITICAL PARTY AND HENCE EVEN THE INTEREST INCOME THEREON PURPORTED TO HAVE BEEN ADDE D CANNOT BE CONSIDERED IN THE ASSESSEES HANDS. AS REGARDS COLLECTION OF DONATIONS, IT WAS S UBMITTED THAT AT THE TIME OF COLLECTION OF DONATIONS , NO ASSOCIATION, CLUB OR POLITICAL PARTY HAD INSISTED FOR THEIR ADDRESS OR FOR THEIR IDENTITY AS PER THE PREVAILING PRACTICE. AS REGARD S THE AUTHENTICATED DOCUMENT FROM THE SECRETARY /CHAIRMAN OF ALL INDIA TRINAMOOL CONGRESS THAT SUCH DONATIONS WERE ACCOUNTED FOR AND ALSO INCLUDED IN THE INCOME TAX RETURN FILE D BY THE PARTY, THE ASSESSEE REPLIED THAT HE CANNOT ASK THE SECRETARY / CHAIRMAN OF THE PARTY DI RECTLY REGARDING THE SAME AND STATED THAT A COPY OF THE LETTER OF THE LD CITA HAD BEEN DULY F ORWARDED TO THE PARTY THROUGH PROPER CHANNEL FOR ASSISTANCE FROM THEIR SIDE. SINCE THE R EPLY FROM THE PARTY WOULD TAKE SOME 6 ITA NO.1481/KOL/2015 LOGIN DAS, AY 2010-11 CONSIDERABLE TIME, THE ASSESSEE PLEADED FOR ADJOURN MENT FOR A LONGER DURATION. THE LD CITA HOWEVER CONCLUDED THAT NO PROPER REPLIES WERE FILED BY THE ASSESSEE AND ACCORDINGLY PROCEEDED TO ENHANCE THE ADDITION TOWARDS CASH DEPO SITS TO RS. 40,18,760/- IN TERMS OF SECTION 69 OF THE ACT. HE FURTHER STATED THAT SINC E THE ENTIRE CASH DEPOSITS HAVE BEEN ADDED, NO FURTHER ADDITION TOWARDS PROFIT THEREON @ 8% IS REQUIRED. AGGRIEVED, THE ASSESSEE IS IN APPEAL BEFORE US. 5. THE LD AR ARGUED THAT THE REMAND REPORT HAS BEE N OBTAINED BY THE LD CITA FROM THE LD AO. THE LD AO HAD NOT GIVEN ADVERSE REMARKS ABO UT THE EVIDENCES SUBMITTED BY THE ASSESSEE. IN THE ABSENCE OF ADVERSE INFERENCES DRA WN BY THE LD AO, THE FACT OF THE BANK ACCOUNTS BELONGING TO TMC PARTY IS ALSO PROVED BEYO ND DOUBT AND THE LD AO WAS THOROUGHLY CONVINCED WITH THE REPLIES AND EVIDENCES FILED BY THE ASSESSEE IN THE REMAND PROCEEDINGS. HE FURTHER PLACED RELIANCE ON THE QUES TIONS 5, 6 & 7 IN THE SWORN STATEMENTS RECORDED FROM MR SURAJIT MALLICK, MR AMIT KUMAR DU TTA AND RANA TALUKDAR WHO HAD STATED THAT THE CASH WAS WITHDRAWN AND HANDED OVER EITHER TO THE CASHIER OF THE TMC PARTY OR TO THE ASSESSEE FOR MEETING DAY TO DAY EXPENDITU RE OF THE PARTY. ADMITTEDLY THESE THREE PERSONS WERE PARTY WORKERS WHICH HAS NOT BEEN DISPU TED BY THE REVENUE AND ADMITTEDLY THE DAY TO DAY PARTY EXPENDITURE IS ONLY FOR THE BENEFI T OF THE OBJECTS OF THE POLITICAL PARTY I.E SERVING THE AILING PEOPLE AND NOT FOR THE PURPOSE O F THE BUSINESS OF THE ASSESSEE. HE ARGUED THAT THERE IS NO SCOPE FOR ANY ENHANCEMENT OF INCOM E IN THE HANDS OF THE ASSESSEE 6. IN RESPONSE TO THIS, THE LD DR ARGUED THAT THE LD AR HAD PLACED COPY OF RESOLUTIONS DATED 15.11.2010 AND 31.3.2011 AUTHORISING ASSESSE E TO SPEND THE MONIES ON BEHALF OF THE POLITICAL PARTY. THESE RESOLUTIONS WERE NOT FILED BEFORE THE LD AO AND THE ASSESSEE HAD NOT MENTIONED ABOUT HIS AUTHORIZATION BY THE PARTY TO S PEND MONIES ON BEHALF OF THE PARTY. HE ARGUED THAT REPLIES TO QUESTION NOS.5 & 6 GIVEN BY THOSE THREE PARTY WORKERS WERE CONTRADICTORY IN AS MUCH AS IN QUESTION NO. 5, THEY SAID THAT THE CASH WAS WITHDRAWN AND HANDED OVER TO THE CASHIER OF THE PARTY AND IN QUES TION NO. 6, THEY REPLIED THAT THE CASH WAS HANDED OVER TO THE ASSESSEE. HE ACCORDINGLY RELIE D ON THE ORDER OF THE LD CITA. 7 ITA NO.1481/KOL/2015 LOGIN DAS, AY 2010-11 7. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIALS AVAILABLE ON RECORD INCLUDING THE PAPER BOOK FILED BY THE ASSESSEE COMP RISING OF PAGES 1 TO 72. WE FIND FROM THE EVIDENCES AVAILABLE ON RECORD INCLUDING THE RES OLUTION COPIES OF THE POLITICAL PARTY, THAT THE TRANSACTIONS IN THE SAID BANK ACCOUNT WITH ICIC I BANK , BALURGHAT IN THE NAME OF THE ASSESSEE IS ONLY MEANT FOR TRANSACTING THE ACTIVITI ES OF THE POLITICAL PARTY. ASSESSEE BEING A PRADHAN OF THE PARTY HAD UNDERTAKEN TO HANDLE THE A FFAIRS OF THE PARTY THROUGH HIS BANK ACCOUNT AS THERE WAS NO BANK ACCOUNT OPENED IN THE NAME OF THE PARTY AT THAT POINT OF TIME. WITH REGARD TO THE FACT AS TO WHY THE POLITICAL PAR TY HAD CHOSEN NOT TO OPEN THE BANK ACCOUNT IN ITS NAME IS TO BE PUT TO THE SAID PARTY AND FAIL URE BY THE PARTY THEREON WOULD NOT AUTOMATICALLY MAKE THE ASSESSEE RESPONSIBLE FOR ITS TRANSACTIONS WHEN THE EVIDENCES IN THE FORM OF RESOLUTIONS, DONATION RECEIPTS, LEDGER ACCO UNT OF BALURGHAT BLOCK TRINAMOOL CONGRESS ACCEPTING THE DONATIONS TO BE PART OF THEI R RECORDS, DEPOSITIONS FROM THE THREE WORKERS OF THE POLITICAL PARTY THAT THEY HAD WITHDR AWN THE CASH AND HANDED OVER EITHER TO THE CASHIER OF THE PARTY OR TO THE ASSESSEE FOR MEETING DAY TO DAY EXPENDITURE OF THE PARTY. THESE FACTS HAVE BEEN DULY CONSIDERED BY THE LD AO IN HIS REMAND REPORT AND NO ADVERSE REMARKS WERE MADE BY HIM ON THE SAME. IN THIS SCEN ARIO, THERE IS NO RHYME OR REASON FOR THE LD CITA TO IGNORE THE SAME AND RESORT TO ENHANCEMEN T OF INCOME IN THE FACTS AND CIRCUMSTANCES OF THE CASE. WE ALSO FIND THAT THE AS SESSEE HAD MAINTAINED DOUBLE ENTRY CASH BOOK CONTAINING BOTH CASH AS WELL AS BANK TRANSACTI ONS (BOTH RECEIPTS AND PAYMENTS) WHEREIN THE DONATIONS RECEIVED IN CASH FROM VARIOUS PARTIES TOGETHER WITH THEIR NAMES WERE DULY RECORDED BY THE ASSESSEE INCLUDING THE CONTRA ENTRIES SUCH AS CASH WITHDRAWALS FROM BANK AND CASH DEPOSITED INTO BANK AND THIS WAS SUBM ITTED BEFORE THE REVENUE. THE FAITHFUL MANNER IN WHICH THE SUCH DOUBLE ENTRY CASH BOOK HAS BEEN MAINTAINED GOES TO PROVE THAT THE ASSESSEE HAD ACTED ONLY IN REPRESENTATIVE CAPAC ITY AND ACTING AS A CUSTODIAN OF THE FUNDS OF THE PARTY. IT IS NOT IN DISPUTE THAT THE SAID F UNDS OF THE PARTY REFLECTED IN THE SAID BANK ACCOUNT WAS NEVER UTILIZED BY THE ASSESSEE EITHER F OR HIS PERSONAL/ BUSINESS PURPOSES. WE FIND THAT THE ASSESSEE HAD DULY REBUTTED THE BANK T RANSACTIONS AS BELONGING TO THE POLITICAL PARTY WITH COGENT EVIDENCES ON RECORD. THE ASSESS EE HAD ALSO FORWARDED THE PAPERS TO THE HIGHER UPS OF THE POLITICAL PARTY THROUGH PROPER CH ANNEL FOR MEETING WITH THE REQUIREMENTS OF THE LD CITA ON THE QUERIES RAISED BY HIM. THIS PROVES THE BONAFIDE CONDUCT OF THE ASSESSEE WITH REGARD TO THE DEALING OF THE SUBJECT MENTIONED BANK TRANSACTIONS. HENCE WE 8 ITA NO.1481/KOL/2015 LOGIN DAS, AY 2010-11 HOLD THAT THERE IS NO CASE MADE OUT BY THE REVENUE TO FRAME AN ADDITION BY EITHER MAKING ADDITION TOWARDS PEAK CREDIT IN THE SUM OF RS. 28,0 9,391/- OR ADDING THE TOTAL DEPOSITS IN THE SUM OF RS. 40,18,760/-. IN VIEW OF THIS, ANOTHER ADDITION MADE IN THE SUM OF RS. 3,21,500/- BEING 8% OF RS. 40,18,760/- U/S 44AD OF THE ACT ALS O STANDS DELETED. ACCORDINGLY, THE GROUND NOS. 2, 3, 4, 5 & 6 RAISED BY THE ASSESSEE ARE ALLOWED. 8. THE GROUND NO.1 & 9 RAISED BY THE ASSESSEE ARE GENERAL IN NATURE AND DOES NOT REQUIRE ANY ADJUDICATION. 9. DURING THE COURSE OF HEARING, THE LD AR STATED THAT THE GROUND NO. 7 RAISED BY THE ASSESSEE IS NOT PRESSED BY HIM FOR WHICH NECESSARY ENDORSEMENT HAS BEEN MADE BY HIM IN THE FILE. ACCORDINGLY, THE GROUND NO. 7 RAISED BY THE ASSESSEE IS DISMISSED AS NOT PRESSED. 10. THE GROUND NO. 8 IS WITH REGARD TO CHARGEABILI TY OF INTEREST U/S 234A & 234 B OF THE ACT WHICH IS ONLY CONSEQUENTIAL IN NATURE AND DOES NOT REQUIRE ANY ADJUDICATION. 11. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS P ARTLY ALLOWED. SD/- SD/- (S.S. VISWANETHRA RAVI) (M. BALAGANESH) JUDICIAL MEMBER ACCOUNTAN T MEMBER DATED : 25TH NOVEMBER, 2016 JD.(SR.P.S.) COPY OF THE ORDER FORWARDED TO: 1 . APPELLANT SHRI LOGIN DAS, KHADIMPUR, MASTER PARA, BALURGHAT, DAKSHIN DINAJPUR-733101 2 RESPONDENT ITO, WARD-3(4), BALURGHAT 3 . THE CIT(A), JALPAIGURI 4. 5. CIT , JALPAIGURI DR, KOLKATA BENCHES, KOLKATA / TRUE COPY, BY ORDER, ASSTT. REGISTRAR .