P USHA, HOSUR V. ITO WARD 1, HOSUR

ITA 1576/CHNY/2018

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 4275 (ITAT-CHENNAI)
• Duration Of Justice: 1 year(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-05-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2013-2014
• Appeal Filed On: 10-05-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Business income; Reasonable cause; Set aside
• Section: 68

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, CHENNAI . . . , . !' , $ % BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER ./ ITA NO.1576/CHNY/2018 ' (' / ASSESSMENT YEAR : 2013-14 SMT. P. USHA SHRI K. SYED SHAHUL MEERAN, 8/2, VENKATASAMY STREET, FORT, SALEM 636 001. PAN : ABEPU 0378 G V. THE INCOME TAX OFFICER, WARD 1, HOSUR. (*+/ APPELLANT) (,-*+/ RESPONDENT) *+ . / / APPELLANT BY : NONE ,-*+ . / / RESPONDENT BY : SHRI AR.V. SREENIVASAN, JCIT 0 . 1$ / DATE OF HEARING : 06.05.2019 2!( . 1$ / DATE OF PRONOUNCEMENT : 10.05.2019 / O R D E R PER N.R.S. GANESAN, JUDICIAL MEMBER : THIS APPEAL OF THE ASSESSEE IS DIRECTED AGAINST T HE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS), SALEM, DATED 22.12.2017 AND PERTAINS TO ASSESSMENT YEAR 2013-14. 2. THERE WAS A DELAY OF 31 DAYS IN FILING THE APPEA L BEFORE THIS TRIBUNAL. THE ASSESSEE FILED APPLICATION FOR CONDO NATION OF DELAY. 2 I.T.A. NO.1576/CHNY/18 HAVING GONE THROUGH THE REASONS STATED IN THE AFFID AVIT, THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT THERE WAS A REASONABLE CAUSE ON THE PART OF THE ASSESSEE IN NOT FILING THE APPEAL WITHIN THE PR ESCRIBED TIME. THEREFORE, WE CONDONE THE DELAY OF 31 DAYS IN FILIN G THE APPEAL BEFORE THIS TRIBUNAL AND ADMIT THE APPEAL. 3. NOW COMING TO THE MERIT OF THE APPEAL, THE ASSES SEE HAS NOT APPEARED BEFORE THIS TRIBUNAL EVEN THOUGH THE NOTIC E WAS SERVED ON THE ASSESSEE. THE REGISTRY HAS PLACED THE POSTAL ACKNO WLEDGEMENT AS PROOF FOR SERVICE OF NOTICE ON THE ASSESSEE. THERE MAY BE VARIOUS REASONS FOR THE ASSESSEE FOR NOT APPEARING EVEN AFT ER RECEIVING THE NOTICE BY RPAD. WHATEVER MAY BE THE REASON FOR NON -APPEARANCE OF THE ASSESSEE, THIS TRIBUNAL IS EXPECTED TO DISPOSE THE APPEAL ON MERIT. THEREFORE, WE HEARD THE LD. DEPARTMENTAL REPRESENTA TIVE AND PROCEEDED TO DISPOSE THE APPEAL ON MERIT. 4. HAVING GONE THROUGH THE GROUNDS RAISED BY THE AS SESSEE, THIS TRIBUNAL FINDS THAT THE ONLY GRIEVANCE OF THE ASSES SEE APPEARS TO BE THAT THE WITHDRAWALS FROM BANK ACCOUNT AND CASH SALES MA DE WERE NOT PROPERLY CONSIDERED BY THE ASSESSING OFFICER WHILE MAKING ADDITION UNDER SECTION 68 OF THE INCOME-TAX ACT, 1961 (IN SHORT 'T HE ACT'). 5. SHRI AR.V. SREENIVASAN, THE LD. DEPARTMENTAL REP RESENTATIVE, SUBMITTED THAT THE ASSESSEE CLAIMED BEFORE THE ASSE SSING OFFICER THAT 3 I.T.A. NO.1576/CHNY/18 THE CASH DEPOSIT IN SAVING BANK ACCOUNT WAS MADE OU T OF WITHDRAWALS AND THE CASH SALES. ACCORDING TO THE LD. D.R., THE ASSESSING OFFICER AFTER CONSIDERING THE WITHDRAWALS AND CASH SALES, F OUND THAT THERE WAS EXCESS DEPOSIT OF 30,03,300/-. THE TOTAL SALES MADE WAS 28,37,814/-, OUT OF WHICH A SUM OF 10,94,475/- WAS RECEIVED BY WAY OF CHEQUE / RTGS THROUGH BANKING CHANNEL. THE CASH SALES, AFTE R REDUCING SUNDRY DEBTORS OF 3,50,870/- WOULD COME TO 13,92,469/-. AFTER CONSIDERING CASH RECEIPTS TO THE EXTENT OF 13,92,469/-, THE EXCESS DEPOSIT MADE BY THE ASSESSEE WORKS OUT TO 16,10,831/-. IN THE ABSENCE OF ANY EXPLANATION TO THE EXTENT OF 16,10,831/-, ACCORDING TO THE LD. D.R., THE ASSESSING OFFICER MADE ADDITION. DURING THE FIRST APPELLATE STAGE ALSO, A SIMILAR CONTENTION WAS RAISED BY THE ASSESSEE AS WA S RAISED IN THE GROUNDS OF APPEAL BEFORE THIS TRIBUNAL. ACCORDING TO THE LD. D.R., THE CIT(APPEALS) BY CONSIDERING THE CASH WITHDRAWALS, F OUND THAT THE WITHDRAWALS TO THE EXTENT OF 9,25,000/- WERE NOT AVAILABLE FOR THE ASSESSEE TO MAKE DEPOSIT, THEREFORE, THE ASSESSEE C ANNOT CLAIM ANY BENEFIT TO THE EXTENT OF 9,25,000/-. THE CIT(APPEALS) FURTHER FOUND THAT AN AMOUNT OF 1,60,000/- WAS WITHDRAWN BY SELF CHEQUE. HE ALSO F OUND THAT THIS AMOUNT OF 1,60,000/- MIGHT HAVE BEEN AVAILABLE FOR DEPOSIT IN THE BANK ACCOUNT, THEREFORE, IT HAS TO BE REDUCED. AFTER CONSIDERING THE CASH WITHDRAWALS TO THE EXTENT OF 19,56,700/-, ACCORDING TO THE LD. D.R., THE CIT(APPEALS) FOUND THAT WHAT IS TO BE ALLOWED I S ONLY 1,60,000/-. 4 I.T.A. NO.1576/CHNY/18 THEREFORE, HE DIRECTED THE ASSESSING OFFICER TO RED UCE THE DISALLOWANCE BY 1,60,000/-. HENCE, ACCORDING TO THE LD. D.R., NO I NTERFERENCE IS CALLED FOR. 6. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EITH ER SIDE AND PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. IT APPEARS FROM THE MATERIAL AVAILABLE ON RECORD THAT THE ASSESSEE USED PRE-BID SECURITY DEPOSIT / EARNEST MONEY DEPOSIT FOR PURCHASE OF SCR AP BY CHEQUE OR BY RTGS. THEREFORE, THE ASSESSING OFFICER FOUND THAT THE CASH SALES AFTER REDUCING SUNDRY DEBTORS OF 3,50,870/-, WOULD COME TO NEARLY 13,92,469/-. THE ASSESSING OFFICER HAS ALSO TAKEN INTO ACCOUNT THE CASH DEPOSITS TO THE EXTENT OF 50,45,000/- AND CAME TO A CONCLUSION THAT THE EXCESS CASH DEPOSIT WAS 30,03,300/-. 7. NOW THE ASSESSEE CLAIMS IN THE GROUNDS OF APPEAL THAT THE MONEY WAS WITHDRAWN FOR PRE-BID SECURITY / EARNEST MONEY DEPOSIT. WHENEVER THE TENDER / AUCTION WAS NOT SUCCESSFUL, T HE MONEY WILL BE DEPOSITED IN THE BANK ACCOUNT. THIS CLAIM OF THE A SSESSEE WAS NOT CONSIDERED BY THE AUTHORITIES BELOW. THEREFORE, TH IS TRIBUNAL IS OF THE CONSIDERED OPINION THAT THE MATTER NEEDS TO BE RE-E XAMINED BY THE ASSESSING OFFICER. ACCORDINGLY, ORDERS OF BOTH THE AUTHORITIES BELOW ARE SET ASIDE AND THE ENTIRE ISSUE RAISED BY THE ASSESS EE IS REMITTED BACK TO THE FILE OF THE ASSESSING OFFICER. THE ASSESSING O FFICER SHALL RE-EXAMINE 5 I.T.A. NO.1576/CHNY/18 THE MATTER IN THE LIGHT OF THE MATERIAL THAT MAY BE FILED BY THE ASSESSEE AND THEREAFTER DECIDE THE ISSUE AFRESH IN ACCORDANC E WITH LAW, AFTER GIVING A REASONABLE OPPORTUNITY TO THE ASSESSEE. 8. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE COURT ON 10 TH MAY, 2019 AT CHENNAI. SD/- SD/- (. !' ) ( . . . ) (A. MOHAN ALANKAMONY) (N.R.S. GANES AN) $ / ACCOUNTANT MEMBER /JUDICIAL MEMBER /CHENNAI, 4 /DATED, THE 10 TH MAY, 2019. KRI. . ,156 76(1 /COPY TO: 1. *+ /APPELLANT 2. ,-*+ /RESPONDENT 3. 0 81 () /CIT(A), SALEM 4. PRINCIPAL CIT, SALEM 5. 69 ,1 /DR 6. :' ; /GF.