Ashok Kumar Aggarwal, Panchkula V. ITO, W-1, Panchkula

ITA 1502/CHANDI/2018

• Counselvise Citation: [2019] 116 COUNSELVISE.COM (IT) 9906 (ITAT-CHANDIGARH)
• Duration Of Justice: 5 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-05-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2010-2011
• Appeal Filed On: 04-12-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: HARJINDER SINGH
• Assessee Lawyers: ASHOK KUMAR AGGARWAL
• Section: 68

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL, CHANDIGARH BE NCH SMC CHANDIGARH , ! BEFORE: SMT. DIVA SINGH, JM ./ ITA NO. 1502/CHD/2018 / ASSESSMENT YEAR : 2010-11 SHRI ASHOK KUMAR AGGARWAL, HOUSE NO. 931, SECTOR 8, PANCHKULA. VS THE ITO, WARD-1, PANCHKULA. ./ PAN NO. : ABKPA9671N / APPELLANT / RESPONDENT / ASSESSEE BY : SHRI ASHOK KUMAR AGGARWAL / REVENUE BY : SHRI HARJINDER SINGH, ADDL.CIT ! ' # / DATE OF HEARING : 22.05. 2019 $%&' # / DATE OF PRONOUNCEMENT : 31.05.2019 '#/ ORDER THE PRESENT APPEAL HAS BEEN FILED BY THE ASSESSEE A SSAILING THE CORRECTNESS OF THE ORDER DATED 23.10.2018 OF CIT(A) PANCHKULA PERTAINING TO 2010-11 ASSESSMENT YEAR ON THE FOLLOWING GROUNDS : 1. THAT THE ORDER OF COMMISSIONER OF INCOME-TAX (APPEA LS) IS BAD AND AGAINST THE LAW CONSIDERING THE CIRCUMSTANCES OF THE CASE AND ITS FACTS. 2. THAT THE LEARNED COMMISSIONER OF INCOME-TAX (APPEAL S) HAS ERRED IN ALLOWING THE ADDITION OF RS. 1 ,60,865/- UNDER SECTION 68 OF THE INCOME TAX ACT WI THOUT APPRECIATING ALL THE FACTS PRODUCED BEFORE. 3. THAT SECTION 68 OF THE ACT IS ABOUT UNEXPLAINED CA SH CREDIT. THE APPELLANT IN THE CURRENT PROCEEDINGS HAD PRODUCED ALL THE FACTS RELATED TO PARTIES AGAINST WHOM ADDITION ARE MADE. THE APPELLANT HAD PROVIDED VERIFICATION LETTE RS, LEDGERS WHICH CLEARLY SHOW THAT THE PARTIES ARE THE DEBTORS WHO HAD GIVEN ADVANCES AGAINST PURC HASE OF BRICKS WHICH WERE SOLD IN THE SUBSEQUENT MONTHS. THE ADVANCE FOR WHICH ADDITION I S MADE HAS ALREADY BEEN CONSIDERED FOR TAX IN THE FOLLOWING YEAR. THE APPELLANT HAD ALSO SUFFI CIENT OTHER SOURCE OF INCOME AND RECEIPT OF RS. 1 ,60,865/- WILL NOT AFFECT HIS CASH FLOW. 4. THAT CONSIDERING THE FACTS PRODUCED , THE APPELLANT PRAYS THAT THE ADDITION OF RS. 1,60,8 65/- MADE UNDER SECTION 68 OF THE ACT BE DELETED. 5. THAT THE APPELLANT CRAVES LEAVE TO ADD, AMEND, ALTE R VARY AND / OR WITHDRAW ANY OR ALL THE ABOVE GROUNDS OF APPEAL. 2. THE RELEVANT FACTS OF THE CASE ARE THAT THE ASS ESSEE IN THE YEAR UNDER CONSIDERATION WAS DERIVING INCOME FROM THE RUNNING OF TWO BRICK KILNS UNDER ITA 1502/CHD/2018 A.Y. 2010-11 PAGE 2 OF 3 THE NAME OF HIS PROPRIETORY CONCERNS M/S A.A. BRICK CO. AND M/S BHARAT BRICK CO. THE AO IN THE COURSE OF THE ASSESSMENT PROCEED INGS REQUIRED THE ASSESSEE TO FURNISH DETAIL OF SUNDRY CREDITORS. ON A CONSID ERATION OF THE EXPLANATION FILED, THE AO HELD THAT THE ASSESSEE FAILED TO FURN ISH VERIFICATION IN RESPECT OF THE CREDITS SHOWN IN THE NAME OF S/SHRI ANIL KUMAR PINZORE, CHARAN DASS SHARMA AND HARISH SHARMA TOTALING TO RS. 1,60,865/- AS CONFIRMATION FROM THE SAID PARTIES WERE NOT FILED. 3. BEFORE THE CIT(A), THE ASSESSEE FILED SOME FRESH EVIDENCES. THESE WERE REMANDED TO THE AO. THE AO REJECTED THE EXPLANATIO N STATING THAT THESE CONFIRMATIONS ARE ON THE LETTER HEADS OF THE ASSESS EE COMPANY WHICH ONLY NAME THE CREDITOR AND THE TOWN, NO COMPLETE DETAILS OR ADDRESS ETC. OF THE PARTIES HAVE BEEN GIVEN. THE ADDITION MADE, ACCORD INGLY WAS SUSTAINED. 4. AGGRIEVED THE ASSESSEE IS IN APPEAL. THE ASSES SEE PRESENT IN PERSON SUBMITTED THAT HE HAS BEEN IN THIS LINE OF BUSINESS SINCE 1980 AND THE BUSINESS OF THE ASSESSEE HAS BEEN CLOSED IN 2013-14 . THE ASSESSMENTS IN 2012-13 AND 2011-12, IT WAS SUBMITTED, WERE CONCLUD ED U/S 143(1). IT WAS ALSO HIS SUBMISSION THAT NO DOUBT, SOME ASSESSMENTS IN SOME YEARS MAY HAVE BEEN MADE U/S 143 (3). REFERRING TO THE FACT, IT W AS HIS SUBMISSION THAT THE NATURE OF ASSESSEE'S BUSINESS, IT CAN BE SEEN IS SA LE OF BRICKS ETC. FOR WHICH PAYMENTS ARE ALWAYS MADE IN CASH. INVITING ATTENTI ON TO PAPER BOOK PAGE 5, IT WAS HIS SUBMISSION THAT INFACT THE ENTIRE BUSINESS HAS BEEN RUN ON THE BASIS OF CASH PAYMENTS AS THE PARTIES WHO COME TO PURCHAS E BRICKS ETC. WOULD ONLY COME ONE TIME WHEN THEY ARE CONSTRUCTING A HOUSE OR MAKING ADDITION IN THEIR HOUSE AND THE OCCASION TO ACCEPT A CHEQUE PAYMENT W ITH THE POSSIBILITY OF THE CHEQUE BOUNCING ETC. RISKS CANNOT BE TAKEN BY A SMA LL BUSINESSMAN. THE ASSESSEE ALSO DOES NOT NEED TO TAKE FULL DETAILS OF THE PERSONS OR ADDRESSES ETC. OF PARTIES WHO COME TO PURCHASE BRICKS AS ON THE RE CEIPT OF THE ADVANCE, THE SALE OF BRICKS IS MADE WITHIN A FEW DAYS WHEN THE P ARTY COLLECTS IT OR GETS IT COLLECTED. THE ASSESSEE DOES NOT NEED TO MAINTAIN CONTINUOUS RECORD OF THE PARTIES TO WHOM BRICKS ARE SOLD. ACCORDINGLY, IT WA S HIS VEHEMENT SUBMISSION THAT SELECTIVELY ONLY FEW PARTIES HAVE BEEN PICKED UP AND THERE IS NO REASON ITA 1502/CHD/2018 A.Y. 2010-11 PAGE 3 OF 3 WHY THESE SHOULD HAVE BEEN PICKED UP AS SALES MADE TO ALL THE OTHERS ARE ALSO ON PAYMENTS RECEIVED IN CASH. 5. THE LD. SR.DR RELIES UPON THE ORDERS OF THE AUTH ORITIES BELOW. 6. I HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED T HE MATERIAL AVAILABLE ON RECORD. IT IS SEEN THAT THE ASSESSEE, AS PER ITS P LEADINGS ON RECORD AND THE EVIDENCE RELIED UPON ADMITTEDLY MADE SALES OF BRICK S ON RECEIVING PAYMENTS IN CASH. THE OCCASION FOR THE ASSESSEE TO MAINTAIN CO MPLETE ADDRESS AND PAN ETC. DETAILS OF THE PERSONS TO WHOM BRICKS HAVE BEE N SOLD HAS NOT BEEN BROUGHT OUT BY THE REVENUE. THE PAYMENTS RECEIVED ADMITTED LY ARE TRADING RECEIPTS. CONSIDERING THE NATURE OF THE ASSESSEE'S BUSINESS W HO ALSO RELIES ON HIS PAST HISTORY WHERE THE ASSESSEE IS STATED TO HAVE SHUT D OWN HIS BUSINESS ITSELF, I FIND IN THE FACE OF THE RECORD AVAILABLE WHICH ADMI TTEDLY SHOWS THAT ALL BUSINESS TRANSACTIONS ARE IN CASH, SELECTION OF THE SE FEW INSTANCES IN THE PECULIAR FACTS BECOMES QUESTIONABLE. ACCEPTING THE EXPLANATION OFFERED BY THE ASSESSEE PRESENT IN PERSON. CONSIDERING THE TOTAL R ECEIPTS OF THE ASSESSEE AS MADE AVAILABLE AT PAPER BOOK PAGE 5 IN THE CONTEXT OF THE ARGUMENTS ADVANCED, I FIND NO GOOD REASON TO SUSTAIN THE ADDI TIONS MADE. ACCEPTING THE ARGUMENTS ON FACTS AS THEY STAND, THE ADDITION IS D IRECTED TO BE DELETED. SAID ORDER WAS PRONOUNCED IN THE OPEN COURT AT THE TIME OF HEARING ITSELF. 7. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED . ORDER PRONOUNCED IN THE OPEN COURT ON 31 ST MAY,2019. SD/- ( ) (DIVA SINGH) ! / JUDICIAL MEMBER % & %( )* +* / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT - 2. / THE RESPONDENT - 3. ! , / CIT 4. ! , ( )/ THE CIT(A) 5. *-. / , # / , 012.3 / DR, ITAT, CHANDIGARH 6. .2 4' / GUARD FILE %( ! / BY ORDER, 5 / ASSISTANT REGISTRAR