Jitendrakumar Harpaldas Panjvani, Sabarkantha V. ITO, Sabarkantha Ward-2, Himmatnagar

ITA 1958/AHD/2018

• Counselvise Citation: [2021] 104 COUNSELVISE.COM (IT) 7039 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 2 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-12-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2015-2016
• Appeal Filed On: 16-09-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Unexplained cash credit
• Section: 68; 2; 44AD; 143(2)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL “SMC” BENCH, AHMEDABAD (through web-based video conferencing platform) BEFORESHRI RAJPAL YADAV, VICE PRESIDENT ITA No. 1958/Ahd/2018 Assessment Year : 2015-16 Jitendrakumar Harpaldas Panjvani, Shop No.36, Ambika Complex, Damodar Area, Tal-Idar, Dist-Sabarkanta, Gujarat-383430 PAN : AMKPP 3205 C Vs. Income-Tax Officer, Sabarkanta Ward-2, Himatnagar अपीलाथ牸 अपीलाथ牸अपीलाथ牸 अपीलाथ牸/ (Appellant) 灹瀄 य 灹瀄 य灹瀄 य 灹瀄 यथ牸 थ牸थ牸 थ牸/ (Respondent) Assessee by : Shri Moxak B. Doshi, CA Revenue by : Shri R.R. Makwana, Sr DR सुनवाई क琉 तारीख सुनवाई क琉 तारीखसुनवाई क琉 तारीख सुनवाई क琉 तारीख/Date of Hearing : 23/11/2021 घोषणा क琉 तारीख /Date of Pronouncement: 06/12/2021 आदेश आदेशआदेश आदेश/O R D E R The assessee is in appeal before the Tribunal against the order of learned Commissioner of Income-Tax (Appeals)-2, Ahmedabad [“CIT(A)” in short] dated 27.07.2018 passed for Assessment Year 2015-16. 2. The solitary substantial grievance of the assessee is that the learned CIT(A) has erred in confirming the addition of Rs.9,92,423/- which was added by the Assessing Officer with the aid of Section 68 of the Income-tax Act, 1961 (“the Act” in short). 3. The brief facts of the case are that the assessee is an individual running Kariyana Store (General Store). He has filed his return of income on 18.09.2015 showing total income of Rs.2,58,810/-. The case of the assessee was selected for scrutiny assessment and a notice under Section 143(2) of the Act was issued and served upon the assessee. The learned Assessing Officer found that the assessee has offered his income under Section 44AD of the Act by showing gross turnover/receipt at Rs.35,91,795/-. However, after the notice, the SMC-ITA No.1958/Ahd/2018 Jitendrakumar Harpaldas PanjvaniVs. ITO For AY: 2015-16 2 assessee has revised the gross sales to Rs.41,06,918/- and declared deemed profit under Section 44AD of the Act @ 8% at Rs.3,28,553/-. The assessee has revised his return. The learned Assessing Officer has rejected this claim of the assessee. He observed that there was cash deposit of Rs.4,77,300/- and in order to explain the cash deposit in the bank the assessee has took a plea that he made cash sales. The Assessing Officer further observed that in the VAT return he has shown Rs.35,91,795/-. So he made 2 additions viz. cash deposits of Rs.4,77,300/- and difference between the revised gross sales vis-à-vis declared in the VAT return, i.e. Rs.41,06,918 – Rs.35,91,794. This comes to Rs.5,15,124/-. In this way, a total addition of Rs.9,92,423/- under the head “unexplained cash credit” has been made. 4. Appeal to the leaned CIT(A) did not bring any relief to the assessee. 5. I have duly considered the rival contentions and gone through the record carefully. I fail to appreciate the logic assigned by the Assessing Officer. The assessee has made small deposits in the bank and accounted all these deposits as a cash sale. The Act authorizes small assessees to declare a deemed profit. The assessee has revised his return and enhanced deemed profit by enhancing the turnover, but it is within the permissible limit. The Assessing Officer assumed that VAT return is a correct return without expecting that the assessee might have revised that also in future or must have not been confronted with the VAT authorities. How this difference between both the gross receipts would become unexplained cash credits? He simply disbelieved the explanation of the assessee; whereas the provisions of Section 44AD of the Act authorizes all this type of assessees not to maintain any documents and just declare the profit at a fixed rate, i.e. 8% of the gross receipts. The Assessing Officer should have not interfered in this working by disbelieving the claim made by the assessee. I, therefore, allow the appeal of the assessee and delete SMC-ITA No.1958/Ahd/2018 Jitendrakumar Harpaldas PanjvaniVs. ITO For AY: 2015-16 3 the addition made by the Assessing Officer and confirmed by the learned CIT(A). 8. In the result, appeal filed by the assessee is allowed. Order pronounced in the Court on 6 th December, 2021 at Ahmedabad. Sd/- (RAJPAL YADAV) VICE PRESIDENT Ahmedabad; Dated 06/12/2021 *Bt आदेश क琉 灹ितिलिप अ灡ेिषत आदेश क琉 灹ितिलिप अ灡ेिषतआदेश क琉 灹ितिलिप अ灡ेिषत आदेश क琉 灹ितिलिप अ灡ेिषत/Copy of the Order forwarded to : 1. अपीलाथ牸 / The Appellant 2. 灹瀄यथ牸 / The Respondent. 3. संबंिधत आयकर आयु猴 / Concerned CIT 4. आयकर आयु猴(अपील) / The CIT(A) 5. िवभागीय 灹ितिनिध, आयकर अपीलीय अिधकरण, अहमदाबाद / DR, ITAT, Ahmedabad 6. गाड榁 फाईल / Guard file. आ आआ आदेशानुसार देशानुसारदेशानुसार देशानुसार/BY ORDER, TRUE COPY उप उपउप उप/सहायक पंजीकार सहायक पंजीकारसहायक पंजीकार सहायक पंजीकार (Dy./Asstt.Registrar) आयकर अपीलीय अिधकरण आयकर अपीलीय अिधकरणआयकर अपीलीय अिधकरण आयकर अपीलीय अिधकरण, अहमदाबाद अहमदाबादअहमदाबाद अहमदाबाद / ITAT, Ahmedabad 1. Date of dictation- ...02.12.2021...... 2. Date on which the typed draft is placed before the Dictating Member ...03.12.2021............ Other member ...06.12.2021.................. 3. Date on which the approved draft comes to the Sr.P.S./P.S. - ...06.12.2021............... 4. Date on which the fair order is placed before the Dictating Member for Pronouncement ...06.12.2021 5. Date on which the file goes to the Bench Clerk...06.12.2021................ 6. Date on which the file goes to the Head Clerk.................................. 7. The date on which the file goes to the Assistant Registrar for signature on the order..................... 8. Date of Despatch of the Order..................