Shri Ramsingh C. Chaudhary, Baroda V. The Income Tax Officer, Ward-5(3), Baroda

ITA 185/AHD/2015

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 8048 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 10 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-12-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Assessment Year: 2009-2010
• Appeal Filed On: 20-01-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: R P MAURYA
• Assessee Lawyers: NIRMIT ME H TA
• Keywords: Gift
• Section: 68

Judgement Text

, * ** * ,LK ,LK,LK ,LK- -- -,E ,E,E ,E- -- -LH LHLH LH * ** * IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH, AHMEDABAD BEFORE SHRI N.K. BILLAIYA, ACCOUNTANT MEMBER AND SHRI MAHAVIR PRASAD, JUDICIAL MEMBER !# I.T.A. NO.185/AHD/2015 ( / ASSESSMENT YEAR : 2009-10) SHRI RAMSINGH C. CHAUDHARY, PROP. OF LAKRA NEW TAFF CO., C/O. NEW R.S. SALES CORPORATION, TAMBOLIWAD, WAJWADA, VADODARA 390 001 # VS. INCOME TAX OFFICER, WARD 5(3), AAYKAR BHAVAN, RACE COURSE ROAD, BARODA. $ # % & # PAN/GIR NO. : ABFPC 1145 E ( !$' / APPELLANT ) .. ( ($' # RESPONDENT ) !$') # APPELLANT BY : SHRI NIRMIT MEHTA, AR ($'*) / RESPONDENT BY : SHRI R. P. MAURYA, SR. DR + ,*-. / DATE OF HEARING 13/12/2017 /012*-. / DATE OF PRONOUNCEMENT 15/12/2017 3# O R D E R PER MAHAVIR PRASAD, JUDICIAL MEMBER : THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX(APPEALS)-V, BARODA, VIDE APPEAL NO. CAB/(A)V-326/11-12 DATED 02/10/2014 FOR THE ASSESSM ENT YEAR (AY) 2009-10, ON THE FOLLOWING GROUNDS: 1. THE LEARNED COMMISSIONER OF INCOME TAX (APPEAL S) - V, BARODA ['THE CIT (A)'] ERRED IN FACT AND IN LAW IN CONFIRM ING THE ACTION ITA NO. 185/AHD /2015 SHRI RAMSINGH C. CHAUDHARY VS. ITO ASST.YEAR 2009-10. - 2 - OF THE INCOME TAX OFFICER, WARD 5(3), BARODA ('THE AO') IN MAKING ADDITION OF RS.8,21,803/-. 2. THE LEARNED CIT(A) ERRED IN FACT AND IN LA W IN CONFIRMING THE ACTION OF THE AO IN NOT ALLOWING DEDUCTION OF PEAK OF EARLIER YEAR FROM ADDITION OF RS.8,21,803/-. 3. THE LEARNED CIT(A) ERRED IN FACT AND IN LAW IN CONFIRMING THE ACTION OF THE AO IN MAKING ADDITION OF RS.2,32,000/ - INVOKING SECTION 68 OF THE INCOME TAX ACT, 1961 ('THE ACT'). 4. THE LEARNED CIT(A) ERRED IN FACT AND IN LAW IN C ONFIRMING THE ACTION OF AO IN CHARGING INTEREST U/S.234B OF THE A CT. 5. THE LEARNED CIT(A) ERRED IN FACT AND IN LAW IN CONFIRMING THE ACTION OF AO IN CHARGING INTEREST U/S/.234C OF THE ACT. 6. THE LEARNED CIT(A) ERRED IN FACT AND IN LAW IN CONFIRMING THE ACTION OF AO IN INITIATING PENALTY PROCEEDINGS U/S. 271(1)(C) OF THE ACT. 2. THE BRIEF FACTS OF THE CASE ARE THAT THE APPELLA NT IS AN INDIVIDUAL AND FILED HIS RETURN OF INCOME ON 27/11/2009 DECLAR ING TOTAL INCOME OF RS.3,17,939/-. THE APPELLANT'S MAJOR SOURCE OF INCO ME CONSISTS OF INCOME FROM HIS BUSINESS AND INCOME FROM PARTNERSHI P FIRM IN WHICH HE IS WORKING AS PARTNER. THE AO HAD MADE AN ADDITION OF RS.8,21,803/- TO THE RETURNED INCOME OF THE APPELLANT. THE AO HAS CA LCULATED THE PEAK OF CASH DEPOSIT AND CASH WITHDRAWAL AND MADE ADDITION OF RS.8,21,803/- TO THE INCOME OF THE APPELLANT. 2.2 DURING THE COURSE OF ASSESSMENT PROCEEDINGS, TH E AO HAS ASKED THE DETAILS OF VARIOUS BANK ACCOUNTS HELD BY THE AP PELLANT. IN RESPONSE TO THE SAME, THE APPELLANT HAS FILED HIS SUBMISSION DA TED 23/08/2011 SUBMITTING THE DETAILS OF HIS BANK ACCOUNT AND CASH BOOK. HOWEVER, INADVERTENTLY, HE FORGOT TO MENTION THE BANK ACCOUN T HELD BY HIM IN ITA NO. 185/AHD /2015 SHRI RAMSINGH C. CHAUDHARY VS. ITO ASST.YEAR 2009-10. - 3 - ICICI BANK. DURING ASSESSMENT PROCEEDINGS, THE APPE LLANT HAD ADMITTED THAT HIS ACCOUNTANT FORGOT TO MENTION THE BANK ACCO UNT OF ICICI BANK AND THERE IS NO INTENTIONAL FAILURE TO DISCLOSE THIS BA NK ACCOUNT. THE APPELLANT HAS VIDE HIS SUBMISSION DATED 25/10/2011 SUBMITTED THE BANK ACCOUNT STATEMENT OF ICICI BANK. HOWEVER, THE AO HA S TAKEN A CONSERVATIVE APPROACH AND DOUBTED THE CASH DEPOSIT AND CASH WITHDRAWAL THE SAID ACCOUNT. 2.3 THE APPELLANT HAD DURING THE COURSE OF ASSESSME NT PROCEEDINGS DULY EXPLAINED THE SOURCE OF THE CASH DEPOSIT IN TH E BANK. THE APPELLANT VIDE HIS SUBMISSION DATED 01/12/2011, SUBMITTED THA T CASH DEPOSITS WERE IN THE NATURE OF SMALL ADVANCE TAKEN FOR 5 TO 10 DAYS FROM VARIOUS PERSONS FROM AN UNORGANIZED SECTOR. THE AMOUNT WAS BORROWED IN CASH. HE HAS EXPLAINED THAT THE AMOUNT WAS BORROWED AND D EPOSITED ON VARIOUS OCCASIONS AS PER THE NEEDS OF THE BUSINESS. 2.4 ON THE OTHER HAND, LD. AO HAD ITSELF SEEN THAT THE ASSESSEE COULD NOT EXPLAIN WITH EVIDENCE PROPERLY THE SOURCE OF SA ID CASH DEPOSITS AND PURPOSE OF WITHDRAWALS MADE. DURING THE COURSE OF H EARING THE ASSESSEE EXPLAINED THAT THE CORRESPONDING WITHDRAWALS SUBSEQ UENT TO CASH DEPOSITS WERE MADE FOR BUSINESS PURPOSE. THE DEPOSITS OF CAS H WERE UNACCOUNTED; HOWEVER, CONSIDERING THAT THERE ARE CORRESPONDING W ITHDRAWALS SUBSEQUENT TO CASH DEPOSITS. THE AO ADOPTED THE PEA K THEORY. ACCORDING TO THE PEAK OF THESE CASH DEPOSITS AND WITHDRAWALS WERE WORKED OUT AT ITA NO. 185/AHD /2015 SHRI RAMSINGH C. CHAUDHARY VS. ITO ASST.YEAR 2009-10. - 4 - RS.8,21,803/- WHICH WAS TREATED AS UNACCOUNTED INCO ME OF THE ASSESSEE FOR THE YEAR UNDER CONSIDERATION AND ADDED TO THE T OTAL INCOME OF THE ASSESSEE. 3. AGAINST THE SAID ORDER ASSESSEE PREFERRED FIRST STATUTORY APPEAL BEFORE THE LD. CIT(A) WHO DISMISSED THE APPEAL OF T HE ASSESSEE. 4. WE HAVE GONE THROUGH THE RELEVANT RECORD AND IMP UGNED ORDER. THE ASSESSEE IS ENGAGED IN THE TRADING BUSINESS OF FOOT WEAR AND RELATED ITEMS. IT IS FACT THAT BY MISTAKE OF THE ACCOUNTANT ASSESSEE HAS NOT INCORPORATED ICICI BANK ACCOUNT NO.000301507944 IN HIS REGULAR BOOKS OF ACCOUNTS. ASSESSEE TOOK THE LOANS IN CASH FROM T HE PERSONS OF UNORGANIZED SECTOR DOING MONEY LENDING BUSINESS FOR SHORTER TERM, OF SAID 5 TO 10 DAYS. HE BORROWED MONEY FROM THEM. HE RECEIVED GIFT OF RS.2,32,000/- IN CASH FROM HIS BROTHER SHRI KISHAN SINGH CHOUDHARY, WHICH WAS PART OF DEPOSIT IN THE ABOVE SAID ICICI B ANK ACCOUNT NO. HE HAS SUBMITTED THE CONFIRMATION LETTER FROM HIS BROT HER AND ALSO SUBMITTED BANK PASSBOOK COPY AND ACKNOWLEDGEMENT OF INCOME TA X RETURN FILED BY HIM BEFORE THE LOWER AUTHORITIES. 5. THE ASSESSEE FILED PAPER BOOK, AT PAGE NO.41 THA T MAXIMUM BALANCE WAS RS.5,77,082/- DATED 01/04/2008 TO 30/09 /2008. WE JUST FAIL TO UNDERSTAND THAT HOW LD. AO CALCULATED THE FIGURE OF RS.8,21,803/-. THEREFORE, WE SET ASIDE THE ORDER OF THE LD. CIT(A) AND REMIT THIS MATTER ITA NO. 185/AHD /2015 SHRI RAMSINGH C. CHAUDHARY VS. ITO ASST.YEAR 2009-10. - 5 - BACK TO THE FILE OF THE AO WHO WILL VERIFY THE PEAK AMOUNT CASH DEPOSITED IN THE BANK BY THE ASSESSEE AND WILL DECI DE THE MATTER ACCORDINGLY. 6. IN THE RESULT, APPEAL FILED BY THE ASSESSEE IS A LLOWED. THIS ORDER PRONOUNCED IN OPEN COURT ON 15 /12 /2017 SD/- SD/- ( ) 4 5 ( N.K. BILLAIYA ) ( MAHAVIR PRASAD ) ACCOUNTANT MEMBER JUDICIAL MEMBER AHMEDABAD; DATED 15/12/2017 PRITI YADAV, SR. PS !'# $#! # COPY OF THE ORDER FORWARDED TO : 1. !$' / THE APPELLANT 2. ($' / THE RESPONDENT. 3. 67- + 8- / CONCERNED CIT 4. + 8- 4!5 / THE CIT(A)-V, BARODA. 5. 9:;-67 !.!672 ! / DR, ITAT, AHMEDABAD 6. ;<=, # GUARD FILE. % & / BY ORDER, (9-- //TRUE COPY// '/& () ( DY./ASSTT.REGISTRAR) , / ITAT, AHMEDABAD