Ramesh Sakharam Kasar, Raigad V. Income-tax Officer, Ward - 3, Panvel

ITA 1742/PUN/2018

• Counselvise Citation: [2019] 115 COUNSELVISE.COM (IT) 7621 (ITAT-PUNE)
• Duration Of Justice: 11 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-10-2019
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: SMC
• Next Hearing Date: 27-08-2019
• Assessment Year: 2014-2015
• Appeal Filed On: 09-11-2018
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: VISHWAS MUNDHE
• Section: 143(3); 271D; 68; 69

Judgement Text

] IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH SMC, PUNE BEFORE SHRI ANIL CHATURVEDI, ACCOUNTANT MEMBER . / ITA NO.1742/PUN/2018 / ASSESSMENT YEAR : 2014-15 RAMESH SAKHARAM KASAR, AT KASHID NANDGAON, MURUD-JANJIRA, DIST. RAIGAD. PAN : BGVPK7320R. . / APPELLANT V/S THE INCOME TAX OFFICER , WARD-3, PANVEL. . / RESPONDENT ASSESSEE BY : SHRI NIKHIL PATHAK. REVENUE BY : SHRI VISHWAS MUNDHE. / ORDER PER ANIL CHATURVEDI, AM : 1. THIS APPEAL FILED BY ASSESSEE IS EMANATING OUT OF THE ORDE R OF COMMISSIONER OF INCOME TAX (APPEALS) 2, PUNE DATED 09.07 .2018 FOR A.Y. 2014-15. 2. THE RELEVANT FACTS AS CULLED OUT FROM THE MATERIAL ON RE CORD ARE AS UNDER :- ASSESSEE IS AN INDIVIDUAL, WHO FILED HIS RETURN OF INCOME FOR A .Y. 2014-15 ON 13.10.2015 DECLARING TOTAL INCOME AT RS.2,91,250 /-. THE CASE WAS SELECTED FOR SCRUTINY AND THEREAFTER ASSESSMEN T WAS FRAMED U/S / DATE OF HEARING : 27.08.2019 / DATE OF PRONOUNCEMENT: 16.10.2019 2 143(3) OF THE ACT VIDE ORDER DT.20.09.2016 AND THE TOTAL INCOME WAS DETERMINED AT RS.37,27,215/-. AGGRIEVED BY THE ORDER OF A O, ASSESSEE CARRIED THE MATTER BEFORE LD.CIT(A), WHO VIDE ORDER DT.09. 07.2018 (IN APPEAL NO.87/2017-18) DISMISSED THE APPEAL OF THE ASSESSE E. AGGRIEVED BY THE ORDER OF LD.CIT(A), ASSESSEE IS NOW IN APPEAL AND HA S RAISED THE FOLLOWING GROUNDS : 1. THE LEARNED CIT (A) ERRED IN DISMISSING THE APP EAL OF THE ASSESSEE WITHOUT APPRECIATING THE FACTS OF THE CASE AND FAIL ED TO GIVE ADEQUATE OPPORTUNITIES. 2. THE LD.CIT(A) ERRED IN CONFIRMING THE INCOME ASS ESSED BY THE LEARNED AO AT RS.37,27,215/-. 3. THE APPELLANT SUBMITS THAT BEFORE THE CIT(A) AS WELL AS AT THE STAGE OF ASSESSMENT PROCEEDINGS BEFORE THE AO, THE FACTS COU LD NOT BE APPRECIATED BY BOTH THE AUTHORITIES THAT A) THE AMOUNT DEPOSITED IN THE BANK ACCOUNT WAS NOT OF THE ASSESSEE ALONE OR EARNED BY THE ASSESSEE DURING THE RELEVANT A.Y. 2014-15. B) THE AMOUNT DEPOSITED IN THE BANK ACCOUNT AGGREGATIN G TO RS.34,36,000/- WAS RAISED BY THE ASSESSEE AND OTHER PERSONS FROM MURUD WHO CONTRIBUTED CASH FOR DEPOSITING IN B ANK ACCOUNT, WITH AN INTENTION TO START NEW BUSINESS. C) WITH THE AMOUNT OF CASH DEPOSITED, THE 'PARASAILING BOAT' WAS PURCHASED IN THE NAME OF ASSESSEE AND WAS PROPOSED FOR BUSINESS IN PARTNERSHIP BY PLYING THE SAME AT SEA B EACH IN MURUD. 4. THE APPELLANT HUMBLY SUBMITS THAT THE HARDSHIP IS CAUSED TO HIM OWING TO ABSENCE OF THE PROPER REPRESENTATION AND S UBMISSION AT THE ASSESSMENT AS WELL AS 1 ST APPEAL STAGE, ALTHOUGH, THE NECESSARY DOCUMENTS AND INFORMATION WERE MADE AVAILABLE BY TH E ASSESSEE AT RELEVANT TIME. 5. THE APPELLANT HUMBLY SUBMITS THAT A) HE NEVER EARNED THE INCOME AS ASSESSED BY THE LEARN ED AO AND CONFIRMED BY HONBLE CIT(A). B) HE IS NOT A MAN OF MEANS AS ASSESSED ESPECIALLY AFT ER EARLY RETIREMENT FROM THE JOB. C) THE APPELLANT WAS TRYING TO FIND OUT NEW SOURCE OF INCOME BY DOING BUSINESS OF PARASAILING BOATS AT SEASHORE MUR UD AND FOR THAT PURPOSE THE CONTRIBUTION IN COMMON POOL WAS RA ISED AND DEPOSITED IN THE BANK ACCOUNT IN ORDER TO MAKE PAYM ENT BY CHEQUE FOR PURCHASE OF PARASAILING BOATS AND CONTRI BUTIONS CONFIRMED THE SAME. 3 6. THE APPELLANT HUMBLY SUBMITS THAT THE CONCERNED PERSONS WHO CONTRIBUTED THE SUM COULD NOT GET SUFFICIENT TIME T O EXPLAIN THE SOURCE FOR THE CONTRIBUTION RAISED BY EACH OF THEM WHICH IN UN WARRANTED ADDITION OF RS.34,36,000/- IN THE HANDS OF THE APPELLANT. 7. WITHOUT PREJUDICE IT IS FURTHER SUBMITTED THAT A LTHOUGH THE CONCERNED PERSONS CONFIRMED THE CONTRIBUTION STILL THE ADDITI ON HAS BEEN MADE, HOLDING THE FAILURE TO EXPLAIN BY THE CREDITOR, THE SOURCE FOR THE SOURCE, WHICH WAS NOT JUSTIFIED AS CONFIRMED BY THE CIT(A). 8. THE AO IN THE ASSESSMENT PROCEEDINGS SOUGHT AN E XPLANATION ABOUT THE SOURCE FOR CASH DEPOSITED IN BANK ACCOUNT AND AFTER GOING THROUGH THE EXPLANATION OF THE CONCERNED CREDITORS, MADE ADDITI ON AS UNEXPLAINED CASH DEPOSITED IN BANK, WITHOUT GOING ADEQUATE OPPO RTUNITIES TO EXPLAIN THE RETURN FILED. 9. THE CIT(A) AND THE LEARNED AO FAILED TO APPRECIA TE THAT A) THE ASSESSEE HAD PAST SAVINGS IN THE FORM OF CASH A CCUMULATION. B) THE CASH DEPOSITED CAME ALSO OUT OF BUSINESS RECEIP T. C) THE ASSESSEE AVAILED GOLD LOAN. 3. BEFORE ME, AT THE OUTSET, LD.A.R. SUBMITTED THAT HE DOE S NOT WISH TO PRESS GROUND NO.1 AND THE ONLY EFFECTIVE GROUND IS 3(B). 4. THE GROUND NO.3(B) IS WITH RESPECT TO THE CASH DEPOSIT S OF RS.34,36,000/- IN THE SAVING BANK ACCOUNT OF ASSESSEE. 4.1. AO HAS NOTED THAT INFORMATION WAS RECEIVED ABOUT T HE HUGE CASH DEPOSITS IN ASSESSEES BANK ACCOUNT. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, ON PERUSING THE BANK ACCOUNT OF ASSESSEE MAINTAINED WITH STATE BANK OF INDIA, MURUD JANJIRA BRANCH, IT WAS NOTICED THAT ASSESSEE HAS MADE AGGREGATE CASH DEPOSITS OF RS.34,36,000/-. THE ASSESSEE WAS ASKED TO EXPLAIN THE NATURE AND SOURCE OF CASH DEPOSITS . ASSESSEE INTER- ALIA SUBMITTED THAT ASSESSEE ALONG WITH FIVE OTHER PERSONS INTENDED TO BUY PARASAILING WATER BOAT FOR BUSINESS PURPOSE AND FOR W HICH FIVE OTHER PERSONS CONTRIBUTED THE CASH WHICH WAS DEPOSITED IN ASS ESSEES SAVING BANK ACCOUNT WITH S.B.I. THE DETAILS OF PERSON-WISE CONTR IBUTION AND THE 4 DATE OF CASH DEPOSITS ARE NOTED BY THE AO IN PAGE 4 OF THE ASSESSMENT ORDER. WITH RESPECT TO THE SOURCE OF THE DEPOSITS BY THOSE PERSONS ASSESSEE SUBMITTED THAT THE AMOUNT WAS RECEIVED BY TH EM THROUGH HAND LOANS. AO NOTED THAT THE DETAILS OF HAND LOANS, NAMES AND ADDRESS OF THE PERSONS FROM WHOM HAND LOAN WAS RAISED, WHETHER T HE HAND LOAN WAS RETURNED BY THEM OR NOT ETC. WAS NOT PROVED BY THE ASSESSEE. AO ALSO NOTED THAT AS PER THE BILLS ISSUED BY AQUARIUS FIBE REGLAS PVT. LTD., THE BOAT WAS PURCHASED BY THE ASSESSEE ALONG WITH SHR I UMESH SAKHARAM KASAR AND SHRI BHARAT DASHRATH BELOSE. AO N OTED THAT THE PURCHASE WAS THUS ONLY IN THE NAME OF THESE THREE PERSONS AND N OT OTHER PERSONS WHO STATED TO HAVE CONTRIBUTED FOR THE PURPOS E OF THE BOAT. AO CONCLUDED THAT THE PERSONS WHO STATED TO HAVE BEEN C ONTRIBUTED AMOUNT FOR THE PURCHASE OF BOAT FOR BUSINESS PURPOSE WERE HAVIN G MEAGER INCOME AND THEIR CREDITWORTHINESS WAS NOT PROVED. AO AC CORDINGLY CONSIDERED THE AGGREGATE CASH DEPOSITS OF RS.34,36,000/- AS UNEXPLAINED CASH DEPOSITS AND MADE ITS ADDITION U/S 69 OF THE ACT. A GGRIEVED BY THE ORDER OF AO, ASSESSEE CARRIED THE MATTER BEFORE LD.CIT(A), WHO UPHELD THE ORDER OF AO. AGGRIEVED BY THE ORDER OF LD.CIT(A), ASSESSEE IS NOW IN APPEAL. 5. BEFORE ME, LD.A.R. REITERATED THE SUBMISSIONS MADE BEFORE AO AND LD.CIT(A). HE FURTHER SUBMITTED THAT OUT OF THE TOTAL CAS H DEPOSITS OF RS.34,36,000/-, RS.25 LAKHS ARE RECEIVED BY THE ASSESSEE FROM OUTSIDERS, WHOSE NAMES ARE LISTED BY AO IN PAGE 5 OF THE ASSESSME NT ORDER AND THE BALANCE AMOUNT IS FROM ASSESSEE AND OTHER FAMILY MEMBER S. HE SUBMITTED THAT WITH RESPECT TO THE LOAN FROM OUTSIDERS, A O HAD PASSED A PENALTY ORDER U/S 271D OF THE ACT ON 22.12.2016 WHEREIN ON THE AMOUNT 5 OF LOAN OF RS.13 LAKHS, HE HAS LEVIED PENALTY U/S 271D OF THE ACT. HE THEREFORE SUBMITTED THAT TO THE EXTENT WHEN THE PERSO NS HAVE BEEN IDENTIFIED TO HAVE GIVEN LOANS, ADDITION U/S 68 OF THE ACT IS NOT WARRANTED. WITH RESPECT TO THE BALANCE ADDITION WHICH IS FROM THE ASSESSEE AND HIS FAMILY MEMBERS, HE RELIED ON THE SUBMISSI ONS MADE BY THE ASSESSEE BEFORE AO AND LD.CIT(A). LD. D.R. ON THE OTH ER HAND, SUBMITTED THAT THE PENALTY PROCEEDINGS ARE SEPARATE AN D MERELY BECAUSE PENALTY HAS BEEN LEVIED U/S 271D OF THE ACT ON CERTAIN DEPOSITS, IT CANNOT BE SAID THAT NO ADDITION U/S 68 OF THE ACT IS WAR RANTED. HE THUS SUPPORTED THE ORDER OF LOWER AUTHORITIES. 6. I HAVE HEARD THE RIVAL SUBMISSION AND PERUSED THE M ATERIAL ON RECORD. THE ISSUE IN THE PRESENT GROUND IS WITH RESPEC T TO ADDITION OF CASH DEPOSITS AGGREGATING TO RS.34,36,000/- IN ASSESSEES SAVING BANK ACCOUNT MAINTAINED WITH SBI. IT IS THE CASE OF THE ASSES SEE THAT HE HAD RECEIVED LOANS AGGREGATING TO RS.25 LAKHS FROM OUTSIDERS FO R PURCHASING OF SHIPPING BOAT FOR BUSINESS PURPOSE. IT IS ALSO A FACT T HAT ON SUCH CASH DEPOSITS WHICH HAVE BEEN RECEIVED BY THE ASSESSEE , AO VIDE ORDER DATED 22.12.2016 PASSED U/S 271D OF THE ACT HAD LEVIED P ENALTY ON RS.13 LAKHS WHICH IS THE UNSECURED LOAN TO HAVE BEEN REC EIVED BY THE ASSESSEE BY CASH FROM THOSE PERSONS. IN SUCH A SITUAT ION, I FIND FORCE IN THE ARGUMENT OF THE LD.A.R. THAT TO THE EXTENT OF RS.13 LA KHS, THE PARTIES HAVE BEEN IDENTIFIED AND NO ADDITION IS WARRANTED TO THAT EXTENT. WITH RESPECT TO THE BALANCE AMOUNT, NO PLAUSIBLE INFORMATION HA S BEEN FURNISHED BY THE LD.A.R. AND NOR WAS HE IN A POSITION TO CO NTROVERT THE FINDINGS OF AO AND LD.CIT(A). I THEREFORE DIRECT THE DELETION OF ADDITION TO THE EXTENT OF RS.16,50,000/- AND THE BALANCE AMOUNT OF AD DITION IS CONFIRMED. THUS, THE GROUND OF THE ASSESSEE IS PARTLY ALLOWED . 6 7. IN THE RESULT, THE APPEAL OF ASSESSEE IS PARTLY ALL OWED. ORDER PRONOUNCED ON 16 TH DAY OF OCTOBER, 2019. /- SD/- ( ANIL CHATURVEDI ) ' / ACCOUNTANT MEMBER PUNE; DATED : 16 TH OCTOBER, 2019. YAMINI #$%&'(' % / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT 3. 4. 5 6. CIT(A)-2, PUNE. THE PR.CIT-2, THANE. '#$ %%&',) &', *+ / DR, ITAT, SMC PUNE; $-.// GUARD FILE. / BY ORDER // TRUE COPY // 012%3&4 / SR. PRIVATE SECRETARY ) &' , / ITAT, PUNE.