Shri Bhagwanji Gopalji Chauhan, Navsari V. The Income tax Officer,Ward-1, Navsari

ITA 1680/AHD/2011

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 89622 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 11 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-06-2015
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Next Hearing Date: 16-06-2015
• Assessment Year: 2003-2004
• Appeal Filed On: 22-06-2011
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: DINESH SINGH
• Assessee Lawyers: M K PATEL

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, AHMEDABAD BEFORE SHRI N.S. SAINI ACCOUNTANT MEMBER AND SHRI S.S. GODARA JUDICIAL MEMBER ITA S NO . 1680 /AHD/ 2011 A. Y .20 0 3 - 04 BHAGWANJI GOPALJI CHAUHAN NEAR TOWER, NAVSARI. PAN: AALPB 9734H VS ITO, WARD - 1 , NAVSARI. (APPELLANT) (RESPONDENT) REVENUE BY : S HRI DINESH SINGH , SR. D.R. , ASSESSEE(S) BY : SHRI M.K. PATEL, A.R. / DATE OF HEARING : 16 / 06 /201 5 / DATE OF PRONOUNCEMENT: 19 / 0 6 /201 5 / O R D E R PER S.S. GODARA , JUDICIAL MEMBER THIS ASSESSEE S APPEAL FOR A.Y. 200 3 - 0 4 , ARISE S FROM ORDER OF CIT( A) , VALSAD DATED 27.01.2011 PASSED I N CASE NO .CIT(A) VLS/329/05 - 06 , RESTRICTING UNACCOUNTED CASH ADDITION OF RS.3,35,393/ - TO RS.2,20,000/ - , IN PROCEEDINGS UNDER SECTION 143(3 ) OF THE INCOME TAX ACT , IN SHORT THE ACT . 2. THE ASSESSEE - INDIVIDUAL IS IN LA UNDRY AND DRY CLEANING BUSINESS. THE DEPARTMENT CONDUCTED A SURVEY IN HIS BUSINESS PERMIS ES ON 21.2.2003. IT CAME ACROSS ALLEGED INCRIMINATING DOCUMENTS SUCH AS LOOSE PAPER, COMPUTERIZED BOOKS OF ACCOUNT ITA NO. 1680 /AHD/ 2011 BHAGWANJI GOPALJI CHAUHAN FOR A.Y. 2003 - 04 - 2 - SHOWING FDRS, KVPS AND NSCS ETC IN THE NAMES OF ASSE SSEE S FAMILY MEMBERS. A CASH AMOUNT OF RS.3,35,393/ - WAS ALSO FOUND WHICH WAS NOT EXPLAINED IN THE BOOKS. THE ASSESSEE APPEARS TO HAVE DISCLOSED ADDITIONAL INCOME OF RS.10 LACS OVER AND ABOVE THE REGULAR ONE AS PER HIS STATEMENT RECORDED. HOWEVER, HE FILE D HIS RETURN ADMITTING THE SAID INCOME OF RS.1,70,000/ - ONLY. THE ASSESSING OFFICER TOOK UP SCRUTINY AND SOUGHT FOR REASONS THEREOF. THE ASSESSEE RETRACTED FROM HIS STATEMENT. HE PLEADED THAT THERE WAS NO UNDISCLOSED INCOME SUPPORTED BY ANY RECORD IN HIS C ASE. THE ASSESSING OFFICER HEAVILY RELIED IN ASSESSEE S STATEMENT IN ASSESSMENT ORDER DATED 28.2.2006 RETRACTED AFTER ALMOST TWENTY MONTHS AFTER THE DATE OF SURVEY AND MADE AN ADDITION OF RS.8,30,000/ - I.E. RS.10 LACS 1.70 LACS IN ASSESSMENT ORDER. 3. THE ASSESSEE PREFERRED AN APPEAL. WE FIND THAT THE CIT(A) ACCEPT HIS EXPLANATION QUA THE AFORESAID ADDITION OF RS.8,30,000/ - AND H O LD S THAT CASH AMOUNT OF RS.3,35,393/ - DETECTED DURING THE SURVEY WAS EXPLAINED ONLY TO THE EXTENT OF RS.1,15,393/ - . HE OBSER VES THAT THE ASSESSEE HAS SHOWN LOW WITHDRAWALS IN HIS CASE. THE FINDINGS UNDER CHALLENGE READ AS UNDER: I HAVE CAREFULLY GONE THROUGH THE ASSESSMENT ORDER AND ALSO THE SUBMISSIONS MADE BY THE ID.AR. I HAVE ALSO PERUSED THE REMAND REPORT SUBMITTED BY THE AO AND THE CONTENTS OF THE PAPER BOOK, THE SHORT POINT HERE TO BE DECIDED IS WHETHER THE ADDITION OF RS. 3,3 0 , 000 / - ITA NO. 1680 /AHD/ 2011 BHAGWANJI GOPALJI CHAUHAN FOR A.Y. 2003 - 04 - 3 - MADE BY THE AO IS SUSTAINABLE? AS MENTIONED EARLIER, THE ADDITIONS MADE WAS ON THE BASIS OF INCRI M INATION LOOSE SHEETS, FDRS. NSCS. KVPS AND THE UNACCOUNTED CASH FOUND IN THE COURSE OF SURVEY AND THE STATEMENT RECORDED AT THAT TIME. DURING THE APPELLATE PROCEEDINGS THE LD. AR SUBMITTED DETAILS OF INVESTMENTS BOTH MOVABLE AND IMMOVABLE MADE IN THE NAME OF THE APPELLANT AND IN THE NAME OF PARTNER S AND THEIR FAMILY MEMBERS. IT IS A FACT THAT THOUGH THE AO GOT THE OPPORTUNITY TO STRENGTHEN THE ADDITION BY OFFERING SUITABLE COMMENTS ON THE MATERIALS GIVEN BY THE APPELLANT IN THE PAPER BOOK, THE AO TOOK THE SAME STAND TAKEN IN THE ASSESSMENT ORDER. TH E DISCLOSURE AMOUNT OF 10,00,000 / - WAS NOT MATCHED WITH THE CORRESPONDING ASSETS AND INVESTMENT IN THIS CASE. AT THE SAME TIME, THE SUBMISSIONS MADE BY THE APPELLANT CANNOT BE IGNORED. WITH REGARDS TO THE FDRS, NSCS, KVPS ETC. FOUND DURING THE SURVEY, THE APPELLANT'S LETTERS TO THE AO D ATED. 12.10.2004 AND 20.02.2006 ARE MOST IMPORTANT. IN THE LETTER DATED 12.10.2004 ADDRESS TO THE AO, THE APPELLANT HAD SUBMITTED INTER - ALIA BANK DETAILS, PAN DETAILS, INVESTMENTS DETAILS AND THE DEPOSITS IN THE NAME OF FAMIL Y MEMBERS AND RELATIVES. SOME OF THE FDS ARE CARRY FORWARD FROM THE YEARS 1993, 1997, 2000, 2001 ONWARDS. THE DETAILS IN THIS REGARDS DO NOT SUGGEST THAT THESE FDS ARE BENAMI AND BELONG TO THE APPELLANT. SIMILARLY, THE IVPS & NSC CHART SHOWS THAT THEY ARE DULY RECORDED BY THE APPELLANT AND HIS FAMILY MEMBERS. THAT LEAVES THE UNACCOUNTED CASH. I HAVE PERUSED THE WITHDRAWALS MADE BY THE APPELLANT AND THE FAMILY MEMBERS. THERE SEEMS TO BE LOW WITHDRAWALS. THE UNACCOUNTED CASH WAS NOT EXPLAINED TO THE SATISFACT ION. THEREFORE, THE CASH DETECTED SHOULD BE TREATED AS CONCEALMENT. BEFORE ME THE APPELLANT COULD ESTABLISH SOURCE FOR CASH AMOUNT OF RS.1,15,393/ - OUT OF RS.3,35 ; 393/ - DETECTED DURING THE SURVEY. THEREFORE, THE BALANCE AMOUNT BE ADDED TO THE INCOME OF THE APPELLANT. THUS, THE AO IS DIRECTED TO RECOMPUTE THE INCOME OF THE APPELLANT AS PER THE ABOVE FINDINGS. THIS GROU ND OF APPEAL IS PARTLY ALLOWED. 4. WE HAVE HEARD BOTH SIDES. THE LOWER APPELLATE ORDER HAS ADDED A SUM OF RS.2,20,393/ - OUT OF THE TOTAL CAS H FOUND OF RS.3,35,393/ - ON ACCOUNT OF LOW WITHDRAWALS. WE FIND FROM THE CIT(A) ORDER CHALLENGE THAT THERE ARE NO REASONS WITH SUPPORTIVE EVIDENCE ARE FORTHCOMING FOR ARRIVING AT THIS CONCLUSION. WE REITERATE THAT THE ASSESSING OFFICER ADDED THE ITA NO. 1680 /AHD/ 2011 BHAGWANJI GOPALJI CHAUHAN FOR A.Y. 2003 - 04 - 4 - UNACCOUNTE D INCOME OF RS.8,30,000/ - (SUPRA) WITHOUT EXAMINING THE ASSESSEE S WITHDRAWAL PATTERNS. IN THESE CIRCUMSTANCES, WE HOLD THAT THE FINDINGS UNDER CHALLENGE ARE WITHOUT ANY EVIDENCE. T HE ASSESSEE HAS ALSO FAIL S TO PRODUCE HIS WITHDRAWALS DETAILS . WE HOLD IN THESE PECULIAR CIRCUMSTANCES AND HOLD THAT INSTEAD OF REMANDING THE MATTER FOR ONE MORE INNINGS, LARGER INTEREST OF JUSTICE WOULD BE MET IN CASE THE IMPUGNED ADDITION OF RS.2,20,000/ - IS RESTRICTED TO RS.1 LAC ONLY. THIS ORDER SHA LL NOT BE TAKEN AS A PREC EDENT. THE ASSESSEE S SOLE SUBSTANTIVE GROUND PARTLY SUCCEEDS. 5. THE ASSESSEE S APPEAL IS PARTLY ALLOWED. ORDER PRONOUNCED IN THE COURT ON THIS DAY, THE 19 TH JUNE , 201 5 AT AHMEDABAD . SD/ - SD/ - ( N.S. SAINI ) ( S.S. GODARA ) ACCOUNTANT MEMBER JUDICIAL MEMBER AHMEDABAD; DATED 19 / 06 / 20 1 5 PRABHAT KR. KESARWANI , SR. P . S . / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. / CONCERNED CIT 4. ( ) / THE CIT(A) - III, AHMEDABAD 5. , , / DR, ITAT, AHMEDABAD 6. / GUARD FILE . / BY ORDER, / ( DY./ASSTT.REGISTRAR) , / ITAT, AHMEDABAD