Chittaranjan Debnath, Burdwan V. ITO, Ward-1(3), Burdwan, Burdwan

ITA 1769/KOL/2016

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 1625 (ITAT-KOLKATA)
• Duration Of Justice: 9 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-06-2017
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: SMC
• Next Hearing Date: 07-06-2017
• Assessment Year: 2007-2008
• Appeal Filed On: 06-09-2016
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: G H SEWA
• Keywords: Additional evidence
• Section: 80C; 143(3); 133(6)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH : KOLKATA [BEFORE HONBLE SRI A.T.VARKEY, JM & SHRI M.BALAG ANESH, AM ] I.T.A NO. 1769/KOL/20 16 ASSESSMENT YEAR : 2007-0 8 CHITTARANJAN DEBNATH -VS.- I.T.O., WARD- 1(3), BURDWAN BURDWAN [PAN : AGKPD 6794 Q] (APPELLANT) (RESPONDENT) FOR THE APPELLANT : SHRI SUVO CHAKRABO RTY, ADVOCATE FOR THE RESPONDENT : SHRI G.H.SEWA, ADDL. CI T DATE OF HEARING : 07.06.2017. DATE OF PRONOUNCEMENT : 14.06.2017. ORDER PER M.BALAGANESH, AM 1. THIS APPEAL OF THE ASSESSEE ARISES OUT OF THE ORDER OF THE LEARNED CIT(A)- BURDWAN IN APPEAL NO. 18/CIT(A)/ASL/ITO/W-1(3)/BWN /2010-11 DATED 21.06.2016 AGAINST THE ORDER OF ASSESSMENT FRAMED FOR THE ASST YEAR 2007-08 U/S 143(3) OF THE INCOME TAX ACT, 1961 (HEREINAFTER REFERRED TO AS TH E ACT). 2. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS BE FORE US :- L. FOR THAT PURPORTED ADDITION OF RS. 12,63,838.00 AS AN UNDISCLOSED INCOME OF APPELLANT IN UNJUST SINCE THERE HAS BEEN DEPOSITS A ND WITHDRAWALS IN SAID S.B.I. A/C. EVEN THERE HAD BEEN MORE WITHDRAWALS THAN DEPO SITS. HENCE NO ADDITION IS SUSTAINABLE. 2. FOR THAT THE ADDITION OF ENTIRE AMOUNT AS UNDISC LOSED IS UNJUST SINCE THE SAID A/C WAS JOINT IN NATURE AND APPELLANT'S WIFE WAS INCOME TAX ASSESSEE HAVING SAME COMMISSION INCOME FROM G.T.F.S. LIKE APPELLANT. SO ENTIRE AMOUNT CAN NOT BE OF APPELLANT'S ONLY. 3. FOR THAT SOURCE OF SAID ADD BACK AMOUNT WAS THE PAST SAVINGS OF BOTH OF APPELLANT AND HIS WIFE ACCUMULATED FROM THEIR COMMI SSION INCOME. 4. FOR THAT ESTIMATED ADDITION OF RS. 4,37,461.00 I S UNJUST AND ILLEGAL SINCE IT AMOUNTS TO DOUBLE ADDITION AS THE APPELLANT HAD ALR EADY DISCLOSED FULL COMMISSION INCOME AND PAID TAX ACCORDINGLY. HENCE ADD BACK AMO UNT IS INCLUSIVE OF SAID COMMISSION. SO THERE IS DOUBLE TAXABLE WHICH IS NOT TENABLE IN LAW. 2 ITA NO.1769/KOL/2016 CHITTARANJAN DEBNATH A.YR.2007-08 2 5. FOR THAT APPELLANT MAY MODIFY THE GROUNDS. 3. THE BRIEF FACTS OF THIS APPEAL IS THAT THE ASSES SEE IS A COMMISSION AGENT OF GOLDEN TRUST FINANCIAL SERVICES (GTFS) AND HAD FILED HIS R ETURN OF INCOME FOR THE ASST YEAR 2007-08 ON 28.3.2008 DISCLOSING TAXABLE INCOME OF R S 2,13,780/-. THE GROSS COMMISSION RECEIVED BY THE ASSESSEE WAS RS 8,74,922 /- WHICH WAS CREDITED IN THE INCOME AND EXPENDITURE ACCOUNT PREPARED BY THE ASSE SSEE AND FILED BEFORE THE LD AO. THE ASSESSEE EARNED A NET PROFIT OF RS 3,13,780/- A ND THE SAME WAS DULY REFLECTED AS GROSS TOTAL INCOME OF THE ASSESSEE IN THE RETURN OF INCOME AND AFTER CLAIMING DEDUCTIONS UNDER CHAPTER VIA TO THE TUNE OF RS 1,00 ,000/-, THE ASSESSEE DISCLOSED TAXABLE PROFIT OF RS 2,13,780/-. THE LD AO OBSERVE D THAT THE ASSESSEE HAD DISCLOSED HIS BANK ACCOUNT MAINTAINED WITH FEDERAL BANK BEARING A CCOUNT NUMBER 22241 AND FOUND THAT THE COMMISSION RECEIVED BY CHEQUES WERE NOT DE POSITED IN THIS BANK ACCOUNT. ACCORDINGLY FURTHER ENQUIRY WAS CARRIED OUT BY THE LD AO IN THIS REGARD. LATER NOTICE U/S 133(6) OF THE ACT WAS ISSUED TO GTFS WITH A REQ UEST TO PRODUCE THE DETAILS OF PAYMENT MADE IN FAVOUR OF ASSESSEE TOWARDS COMMISSI ON FOR THE FINANCIAL YEAR 2006-07. THE LD AO ALSO CAME TO KNOW THAT THE ASSESSEE WAS H AVING A SEPARATE BANK ACCOUNT WITH SBI NABADWIP BRANCH VIDE ACCOUNT NUMBER 01150060231 IN THE JOINT NAMES OF HIMSELF AND HIS WIFE MONIKA DEBNATH. THE LD AO C OLLECTED THE SAID BANK STATEMENT FROM SBI U/S 133(6) OF THE ACT AND FOUND THAT THE F OLLOWING CREDITS WERE REFLECTED IN THE SAID BANK STATEMENT :- SL.NO. DATE OF CREDIT AMOUNT 1 12.04.2006 22,045/- 2 12.04.2006 10,587/- 3 10.05.2006 28,049/- 4 13.06.2006 44,655/- 5 28.06.2006 26,806/- 6 06.07.2006 66.89/- 3 ITA NO.1769/KOL/2016 CHITTARANJAN DEBNATH A.YR.2007-08 3 7 27.07.2006 2,00,000/- 8 17.08.2006 54,782/- 9 11.09.2006 31,717/- 10 12.09.2006 15,000/- 11 20.09.2006 29,539/- 12 20.10.2006 19,622/- 13 09.11.2006 6,50,000/- 14 22.12.2006 33,028/- 15 03.01.2007 2,488,.89/- 16 12.01.2007 11,867/- 17 17.02.2007 6,669/- 18 26.02.2007 500/- 19 01.03.2007 50,000/- 20 02.03.2007 16,590/- 21 22.03.2007 9,828/- TOTAL 12,63,839.38/- 4. THE LD AO OBSERVED THAT GTFS HAD SENT THEIR INFO RMATION WITH REFERENCE TO NOTICE U/S 133(6) OF THE ACT MENTIONING THE DATE IF PAYMENT, C HEQUE NUMBER AND AMOUNT OF COMMISSION PAID. THE ASSESSEE ALSO PRODUCED TDS CE RTIFICATE IN FORM 16A FOR THE FINANCIAL YEAR 2006-07. THE LD AO LINKED THE DETA ILS RECEIVED FROM GTFS WITH THE CREDITS FOUND IN THE BANK STATEMENT AND OBSERVED TH AT NOT A SINGLE COMMISSION AMOUNT HAS BEEN DEPOSITED IN SBI , NABADWIP BRANCH AND HEN CE ACCORDINGLY CONCLUDED THAT THE SAID BANK ACCOUNT REPRESENTS UNDISCLOSED BANK ACCOU NT OF THE ASSESSEE AND THEREBY BROUGHT THE ENTIRE CREDITS IN THE SAID BANK ACCOUNT IN THE SUM OF RS 12,63,839/- TO TAX. THIS WAS DONE IGNORING THE CONTENTIONS OF THE ASSES SEE THAT THE SAID BANK ACCOUNT HAS BEEN CONSIDERED IN THE HANDS OF HIS WIFE WHO IS ALS O A COMMISSION AGENT OF GTFS AND IS INDEPENDENTLY ASSESSED TO TAX IN PAN -AGUPD8318G AN D ASSESSED TO TAX BY ITO, 4 ITA NO.1769/KOL/2016 CHITTARANJAN DEBNATH A.YR.2007-08 4 WARD I(3), BURDWAN AND SHE HAD ALSO FILED HER RETUR N FOR ASST YEAR 2007-08. IT WAS ALSO PLEADED THAT THE ASSESSEE HAD DULY DISCLOSED T HE TOTAL COMMISSION RECEIVED AND THE SAME MATCHES WITH FORM 16A ISSUED BY GTFS. 5. THE LD AO FURTHER OBSERVED THAT THOUGH THE ASSES SEE HAD DEBITED VARIOUS EXPENSES IN HIS INCOME AND EXPENDITURE ACCOUNT AND CLAIMED THE SAME AS DEDUCTION, THE SAME WERE SUPPORTED ONLY BY SELF MADE VOUCHERS AND NO SUPPORT ING EVIDENCES WERE SUBMITTED BY THE ASSESSEE. ACCORDINGLY HE ESTIMATED THE ALLOWAB ILITY OF EXPENSES @ 50% OF GROSS COMMISSION RECEIVED BY PLACING RELIANCE ON THE CIRC ULAR NO. 553 DATED 15.5.1991, 648 DATED 30.3.1993 AND 677 DATED 28.1.1994. ACCORDIN GLY, HE DISALLOWED A SUM OF RS 4,37,461/- IN THE ASSESSMENT. 6. THE LD AO BY MAKING THE AFORESAID ADDITION / DIS ALLOWANCE, DETERMINED THE TOTAL INCOME OF THE ASSESSEE AS UNDER:- GROSS COMMISSION RECEIVED 8,74,922 LESS: DEDUCTION ALLOWED AS ABOVE 4,37,461 ---------------- 4,37,461 AMOUNT OF UNDISCLOSED INCOME REPRESENTING TOTAL CRE DITS IN SBI 12,63,839 -------------- ASSESSED COMMISSION INCOME 17,01,300 ADD: INCOME FROM OTHER SOURCES AS PER RETURN 8,160 --------------- GROSS TOTAL INCOME 17,09,460 LESS: DEDUCTION U/S 80C 1,00,000 --------------- ASSESSED INCOME 16,09,460 --------------- 7. THE LD CITA UPHELD THE ACTION OF THE LD AO IN RE SPECT OF BOTH THE ADDITIONS MADE IN THE ASSESSMENT. AGGRIEVED, THE ASSESSEE IS IN APPE AL BEFORE US. 5 ITA NO.1769/KOL/2016 CHITTARANJAN DEBNATH A.YR.2007-08 5 8. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIALS AVAILABLE ON RECORD. WE FIND THAT THE LD AO HAD ACCEPTED THE FACT THAT T HE MONIES CREDITED IN THE SBI BANK ACCOUNT REPRESENTS ONLY COMMISSION INCOME. WE FIND THAT THE LD AO HAS ALSO CATEGORICALLY STATED IN HIS ASSESSMENT ORDER THAT N OT A SINGLE COMMISSION INCOME WAS FOUND CREDITED IN FEDERAL BANK ACCOUNT ALREADY DISC LOSED BY THE ASSESSEE. THE LD AR HAD PRODUCED THE ENTIRE BANK STATEMENT OF SBI ACCOU NT BEFORE US AND TRIED TO EXPLAIN EACH AND EVERY CREDIT THEREON AS AMOUNT RECEIVED FR OM GTFS . IT IS NOT IN DISPUTE THAT THE SBI ACCOUNT IS A JOINT ACCOUNT MAINTAINED BY AS SESSEE WITH HIS WIFE. HENCE CHEQUES OF BOTH ASSESSEE AS WELL AS HIS WIFE ARE PERMITTED TO BE DEPOSITED THEREON. IN THE INSTANT CASE, WE FIND THAT THE CHEQUES RECEIVED FROM GTFS B Y BOTH ASSESSEE AS WELL AS HIS WIFE WERE DEPOSITED IN SBI ACCOUNT. WE FIND THAT THE L D AR HAD FILED THE DETAILS OF AMOUNTS RECEIVED FROM GTFS THROUGHOUT THE YEAR TOGETHER WIT H ITS MODE OF RECEIPT FOR BOTH ASSESSEE AS WELL AS HIS WIFE. FROM THE SAME , IT IS GLARING ON US THAT ON THE SAME DAY, TWO CHEQUES WERE ISSUED BY GTFS INDEPENDENTLY FOR A SSESSEE AND ANOTHER FOR HIS WIFE. BOTH THESE CHEQUES WERE DEPOSITED IN SBI. FOR EXA MPLE ON 13.6.2006, THE ASSESSEE HAS RECEIVED RS 29,169/- AND HIS WIFE HAS RECEIVED RS 1 5,486/- AND THERE IS A SINGLE CREDIT IN SBI BANK ACCOUNT ON 13.6.2006 TO THE TUNE OF RS 44,655/- ( 29169+15486). SIMILAR IS THE CASE FOR OTHER DATES AS PREPARED IN THE TABU LATION ABOVE. MOREOVER , WE FIND THAT BOTH THE ASSESSEE AS WELL AS HIS WIFE HAD DULY CRED ITED THE GROSS COMMISSION RECEIVED IN THE SUMS OF RS 8,74,922/- AND RS 12,19,911/- IN THE IR RESPECTIVE INCOME AND EXPENDITURE ACCOUNT AND THIS FIGURE DULY MATCHES WITH THE TDS C ERTIFICATE ISSUED BY GTFS TO EACH OF THEM. HENCE THERE CANNOT BE ANY ADDITION THAT C OULD BE MADE BASED ON CREDITS FOUND IN THE SBI BANK ACCOUNT WHEN THE LD AO HIMSELF ACCE PTS THE FACT THAT THE SAID CREDITS REPRESENTS ONLY COMMISSION INCOME DERIVED BY THE AS SESSEE . MOREOVER, WE FIND THAT THE ASSESSEE HIMSELF HAD ALREADY CREDITED THE SUM O F RS 8,74,922/- AS GROSS COMMISSION RECEIVED , OUT OF WHICH MAJOR PORTION IS INCLUDED I N THE TOTAL CREDITS SUM OF RS 12,63,839/-. WE FIND THAT THESE FACTS WERE NOT EXA MINED BY THE LD AO. HENCE WE DEEM IT FIT AND APPROPRIATE TO SET ASIDE THESE ISSUES TO THE FILE OF THE LD AO FOR DENOVO 6 ITA NO.1769/KOL/2016 CHITTARANJAN DEBNATH A.YR.2007-08 6 ADJUDICATION AND FRAME THE ASSESSMENT AFRESH IN ACC ORDANCE WITH LAW. NEEDLESS TO MENTION THAT THE ASSESSEE BE GIVEN REASONABLE OPPOR TUNITY OF BEING HEARD. THE ASSESSEE IS AT LIBERTY TO FILE ALL THE EVIDENCES FILED BEFOR E US TOGETHER WITH SOME OTHER ADDITIONAL EVIDENCES , IF HE SO DESIRES, IN SUPPORT OF HIS CON TENTIONS. SINCE THE DISPUTE WITH REGARD TO GROSS COMMISSION RECEIVED ITSELF HAS BEEN SET AS IDE , THE ALLOWABILITY OF EXPENSES THEREON WOULD ALSO DEPEND AFTER DETERMINING THE FIN AL FIGURE OF GROSS COMMISSION. THE ASSESSEE IS AT LIBERTY TO FILE FURTHER EVIDENCES TO JUSTIFY THE CLAIM OF EXPENSES INCURRED BY HIM BEFORE THE LD AO. ACCORDINGLY THE GROUNDS RAIS ED BY THE ASSESSEE ARE ALLOWED FOR STATISTICAL PURPOSES. 9. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE COURT ON 14.06.2017. SD/- SD/- [A.T.VARKEY] [ M.BALAGANESH ] JUDICIAL MEMBER ACCOUNTANT MEMBER DATED : 14.06.2017. [RG PS] COPY OF THE ORDER FORWARDED TO: 1. CHITTARANJAN DEBNATH, TULSHIDANGA, KATHIRPARA, B URDWAN-713519. 2. I.T.O., WARD-1(3), BURDWAN. 3..C.I.T.(A)-BURDWAN 4. C.I.T.-BURDWAN. 5. CIT(DR), KOLKATA BENCHES, KOLKATA. TRUE COPY BY ORDER SENIOR PRIVAT E SECRETARY HEAD OF OFFICE/D.D.O., ITAT, KOLKATA BENCHE S 7 ITA NO.1769/KOL/2016 CHITTARANJAN DEBNATH A.YR.2007-08 7