JASWANT KMAR BAFNA, CHENNAI V. ITO NON CORPORATE WARD 4(2), CHENNAI

ITA 1691/CHNY/2019

• Counselvise Citation: [2022] 106 COUNSELVISE.COM (IT) 6236 (ITAT-CHENNAI)
• Duration Of Justice: 3 year(s) 2 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-08-2022
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2015-2016
• Appeal Filed On: 28-05-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Section: 143(3)

Judgement Text

आयकर अपीलीय अिधकरण ‘बी’ ायपीठ चे ई म । IN THE INCOME TAX APPELLATE TRIBUNAL ‘B’ BENCH, CHENNAI माननीय +ी महावीर िसंह, उपा12 एवं माननीय +ी मनोज कु मार अ7वाल ,लेखा सद: के सम2। BEFORE HON’BLE SHRI MAHAVIR SINGH, VICE PRESIDENT AND HON’BLE SHRI MANOJ KUMAR AGGARWAL, AM आयकर अपील सं./ ITA No.1691/Chny/2019 (िनधाCरण वषC / Assessment Year: 2015-16) Shri Jaswant Kumar Bafna No.144, 3 rd Floor, Mint Street, Sowcarpet, Chennai – 600 079. बनाम/ V s. ITO, Non-Corporate Ward-4(2), Chennai. थायी लेखा सं./जीआइ आर सं./P AN /GI R No . AAF P B -9 4 0 9 - D (अपीलाथ /Appellant) : ( थ / Respondent) अपीलाथ की ओरसे/ Appellant by : Shri T. Banusekar (C.A) – Ld. AR थ की ओरसे/Respondent by : Shri Guru Bashyam (CIT) –Ld. DR सुनवाई की तारीख/Date of Hearing : 04-08-2022 घोषणा की तारीख /Date of Pronouncement : 17-08-2022 आदेश / O R D E R Manoj Kumar Aggarwal (Accountant Member) 1. Aforesaid appeal by assessee for Assessment Year (AY) 2015-16 arises out of the order of Learned Commissioner of Income Tax (Appeals)-5, Chennai [CIT(A)] dated 26-04-2019 in the matter of assessment framed by Ld. Assessing Officer [AO] u/s.143(3) of the Act on 29-12-2017. The assessee has filed multiple grounds of appeal along with Form-36. However, Ld. AR filed elaborate written submissions and pleaded to restore the assessment to the file of Ld. AO. The Ld. AR explained that the assessee has three proprietor ITA No.1691 /Chny/2019 - 2 - concerns. One of the concerns i.e. Raj investments carried out business activity of share trading on behalf of the clients. The cash was received from the clients and the same was deposited into bank account. The assessee transacted in shares and earned profits / loss on behalf of the client. In the said background, Ld. AR assailed the additions made u/s 68. Another concern Bafna investments is stated to be supporting account of Bafna Securities. No transaction is stated to be carried out in Bafna investments but the assessee merely deposited cash received from clients in the bank account of this entity which was further transferred to Bafna Securities. The funds from Bafna securities were further transferred to authorized stockbroker through whom the assessee transacted in shares for his clients. To support the same, Ld. AR filed written submissions of 6 pages which are kept on record. The submissions are sought to be supported by paper books containing 429 pages. The only plea raised by Ld. AR is that all these documents may be examined by Ld. AO and assessment be reframed after considering the issues in the correct perspective. However, Ld. Sr. DR opposed the same and vehemently supported the additions made by Ld. AO. Having considered rival submissions and after perusal of case records, the appeal is disposed-off as under. 2. The assessee was assessed u/s 143(3) on 29.12.2017. It transpired that the Bank account held by Raj investments with Bank of Baroda was not disclosed by the assessee. The assessee could not furnish the details of persons from whom the cash of Rs.506.45 Lacs was received. Therefore, total credit of Rs.582.70 Lacs was added to its income as unexplained cash credit. Similar was the situation with Canara Bank account held in the name of Bafna investments. ITA No.1691 /Chny/2019 - 3 - Accordingly, the addition of Rs.514.40 Lacs was made as unexplained cash credit. Similar addition of Rs.243.77 Lacs was made on account of Canara Bank Credits held in the name of Bafna Securities. 3. During appellate proceedings, the assessee filed additional evidence / information which were subjected to remand proceedings. After considering the findings in remand proceedings, Ld. CIT(A) came to a conclusion that the source of cash deposits remained unexplained and the assessee failed to discharge the onus of proving the source of cash deposits. Therefore, the appeal was dismissed against which the assessee is in further appeal before us. 4. After carful consideration of orders of lower authorities, it could be seen that the assessee had miserably failed to prove the source of cash deposits and merely stated that it carried out transactions on behalf of the clients. However, no income was shown by the assessee from this activity. In fact, the bank accounts were not disclosed by the assessee which negate the submissions made by the assessee. However, we find that the assessee has placed on record elaborate documents which are in the shape of table showing details of cash received from clients, details of cheques issued to clients along with Name, address and PAN of the payees in Raj investment. The bank statements of Raj investment as well as copy of statements issued by this entity have also been furnished. Similar elaborate documents have also been furnished with respect to other two entities. Keeping in mind the principle of natural justice and considering the fact that only real income is to be assessed, this case is a fit case for remand back to Ld. AO. Therefore, without delving much deeper into the issue, we restore the matter of assessment to the file of Ld. AO. The Ld. AO is directed ITA No.1691 /Chny/2019 - 4 - to make de novo assessment after affording reasonable opportunity of hearing to the assessee. The assessee, in turn, is directed to substantiate its case failing which Ld. AO shall be at liberty to proceed with the assessment on the basis of material on record. All the issues are kept open. 5. The appeal stand allowed for statistical purposes. Order pronounced on 17 th August, 2022. Sd/- (MAHAVIR SINGH) उपा12 /VICE PRESIDENT Sd/- (MANOJ KUMAR AGGARWAL) लेखा सद: / ACCOUNTANT MEMBER चे,ई / Chennai; िदनांक / Dated : 17-08-2022 EDN/- आदेश की Vितिलिप अ 7ेिषत/Copy of the Order forwarded to : 1. अपीलाथ /Appellant 2. यथ /Respondent 3. आयकर आयु (अपील)/CIT(A) 4. आयकर आयु /CIT 5. िवभागीय ितिनिध/DR 6. गाड फाईल/GF