Abdullah Siddique, Saharanpur V. ITO, Ward-1 , Saharanpur

ITA 2111/DEL/2018

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 2276 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 2 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-06-2019
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2012-2013
• Appeal Filed On: 27-03-2018
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: S L ANURAGI
• Keywords: Unexplained cash credit; Business income; Peak credit
• Section: 44AD; 69; 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH: SMC: NEW DELHI) BEFORE SMT. DIVA SINGH, JUDICIAL MEMBER ITA NOS.:- 2107, 2111 & 2112/DEL/2018 (ASSESSMENT YEARS: 2013-14, 2012-13 & 2014-15) ABDULLAH SIDDIQUE S/O SHRI ABDUL ALLAM, MOHALLA-SHEIKH ZADGAN, SAHKARI KRISHI YANTRA, SARAHANPUR, UTTAR PRADESH VS. ITO WARD- 1 SAHARANPUR PAN NO: BGZPS9799C APPELLANT RESPONDENT ASSESSEE BY : NONE. REVENUE BY : SH. S.L. ANURAGI, SR. DR DATE OF HEARING : 13.06.2019 DATE OF PRONOUNCEMENT : 25.06.2019 ORDER PER DIVA SINGH : THESE THREE APPEALS FILED BY THE ASSESSEE ASSAIL T HE CORRECTNESS OF THE SEPARATE ORDERS DATED 05.12.2017 OF CIT(A)- MUZAFFA RNAGAR, PERTAINING TO 2012-13, 2013-14, 2014-15 ASSESSMENT YEARS ON IDENT ICAL GROUNDS. ACCORDINGLY NOTING THAT THE ISSUES RAISED IN THE AP PEALS RELY UPON SIMILAR SET OF FACTS AND CIRCUMSTANCES A CONSOLIDATED ORDER FOR TH E YEARS UNDER CONSIDERATION IS BEING PASSED. 2. HOWEVER IT IS WORTH MENTIONING THAT AT THE TIME OF HEARING, NO ONE WAS PRESENT ON BEHALF OF THE ASSESSEE. THE APPEALS WERE PASSED OVER. IN THE SECOND ROUND ALSO THE ASSESSEE REMAINED UNREPRESENTED. CON SIDERING THE FACT THAT ON THE LAST DATE OF HEARING I.E. 06.03.2019 THE APPEAL S WERE ADJOURNED ON THE WRITTEN REQUEST OF THE ASSESSEE IN THE BACKGROUND W HERE ON THE EARLIER DATE FIXED FOR HEARING I.E 10.09.2018, THE APPEAL WAS AD JOURNED ON THE WRITTEN REQUEST OF THE ASSESSEE AND YET AGAIN ON 11.12.2018 , THE ASSESSEE FAILED TO APPEAR. IN THESE CIRCUMSTANCES SINCE DESPITE INFORM ATION THE ASSESSEE HAS ITA NOS.:- 2107, 2111, 2112/DEL/2018 ABDULLAH SIDDIQUE. PAGE 2 OF 5 FAILED TO PUT IN ANY APPEARANCE IT WAS DEEMED APPRO PRIATE TO PROCEED WITH THE PRESENT APPEAL EX PARTE QUA THE ASSESSEE APPELLANT ON MERITS. 3. THE LD. SR. DR MR. ANURAGI WAS HEARD WHO SUBMITTED THAT THE FACTS, CIRCUMSTANCES AND POSITION OF LAW IN EACH OF THE AP PEALS ON IDENTICAL GROUNDS REMAINS THE SAME. ACCORDINGLY, THE FACTS, ARGUMENT S AND REASONS CONSIDERED IN ITA 2107/DEL/2018 MAY BE APPLICABLE TO THE REMAI NING TWO APPEALS. ON CONSIDERING THE RECORD, THE SUBMISSIONS OF THE LD. SR. DR WERE FOUND CORRECT ON MERITS. 4. ACCORDINGLY, FOR READY REFERENCE THE GROUNDS FROM I TA 2107/DEL/2018 ARE BEING REPRODUCED HEREUNDER: 1. THE LD CIT(A) HAS WRONGLY CONFIRMED THE AGRICUL TURE INCOME OF RS.325000/- ONLY ASSUMED BY THE LD ITO DESPITE SUBMISSION OF AR GUMENTS AND MATERIAL OF HIGHER AGRICULTURE INCOME BY THE APPELLANT AND THE LD ITO HAVING NOT BROUGHT OUT ANY MATERIAL WHATSOEVER OF HIS ASSUMPTION OF AG RICULTURE INCOME. 2. THE LD. CIT (A) HAVE GROSSLY ERRED ON FACTS AND LAW IN CONFIRMING AN ADDITION OF RS 6,25,343/- TO THE INCOME OF THE APPELLANT AS UNEXPLAINED CASH DEPOSITS IN THE BANK ACCOUNT UNDER SECTION 69 A OF THE INCOME T AX ACT 1961. 3. THE APPELLANT CRAVES FOR LEAVE TO ADD, AMEND, MO DIFY OR WITHDRAW ANY OF THE GROUNDS OF APPEAL. 5. THE RELEVANT FACTS OF THE CASE ARE THAT THE ASSESSE E IN RESPONSE TO NOTICE U/S 148 OF INCOME TAX ACT, 1961, RETURNED AN INCOME OF RS. 2,02000/-. THE AO IN THE COURSE OF THE SCRUTINY PROCEEDINGS REQUIR ED THE ASSESSEE TO EXPLAIN THE DEPOSITS OF RS. 35,26,150/- IN STATE BANK OF IN DIA AND PUNJAB NATIONAL BANK ACCOUNTANT NOS. 10926030202 AND 37260001020013 05 RESPECTIVELY. THE ASSESSEE IN RESPONSE THERETO SUBMITTED THAT HIS MAI N SOURCE OF INCOME IS FROM AGRICULTURE. THE DEPOSITS IN THE BANK WERE STATED T O BE FROM SALE OF CROPS AND POPLAR TREES. IT WAS CLAIMED THAT HE HAD ALSO TAKEN LAND ON CONTRACT TO GROW CROPS. THE ASSESSEE WAS ALSO FOUND TO HAVE PAID MBB S FEES FOR HIS DAUGHTER MISS SABIYA ABDULLAH AMOUNTING TO APPROXIMATELY RS. 7,00,000/- PER ANNUM. ACCORDINGLY, CONSIDERING THE EXPLANATION AND THE EV IDENCES ADDITION OF RS. 32,16,150/- WAS MADE BY THE A.O. IN THE FOLLOWING M ANNER: AS PER THE DOCUMENTS PRODUCED THE ASSESSEE IS HAVI NG ; APPROXIMATELY 65 BIGHAS OF AGRICULTURAL LAND AND AS PER THE PRESCRIB ED RATE AN AVERAGE OF RS.4000/- TO 5000/- AGRICULTURAL INCOME IS EARNED F ROM PER BIGHA LAND, THEREFORE, A TOTAL OF RS.3,25,000/- IS CONSIDERED AS AGRICULTU RAL INCOME OF THE ASSESSEE PER ANNUM. IT IS ALSO WORTHWHILE TO MENTION HERE THAT I N THE RETURN FILED IN RESPONSE ITA NOS.:- 2107, 2111, 2112/DEL/2018 ABDULLAH SIDDIQUE. PAGE 3 OF 5 TO NOTICE U/S 148 OF THE ASSESSEE HAS NOT SHOWN ANY INCOME UNDER THE HEAD AGRICULTURAL INCOME, WHEREAS HE IS STATING THAT HIS TOTAL SOURCE OF INCOME IS FROM AGRICULTURE. THEREFORE, EVEN IF THE CONTENTION OF T HE ASSESSED IS ACCEPTED THAT HE IS ENJOYING AGRICULTURE INCOME, THE SAME IS TAKEN O F RS.3,25,000/- AND AFTER DEDUCTING RS.3,25,000/- FROM TOTAL DEPOSITED THE BA LANCE AMOUNT OF RS.3201150/- REMAINS UNEXPLAINED CASE DEPOSITS AS THE ONUS LIES ON THE ASSESSED TO PROVE THE CAPACITY AND GENUINENESS OF THE TRANSACTION. RELIAN CE IS PLACED ON MANOJ AGGARWAL VS DCIT (ITAT, SB DEL) 113 ITD 377 AND VIT VS K. CHINNATHAMBAN (S.C.) 292 ITR 682. 6. THE ASSESSEE CARRIED THE ISSUE IN APPEAL BEFORE TH E CIT(A) WHO CONSIDERING THE FACTS, SUBMISSIONS AND THE EVIDENCE S GRANTED PART RELIEF HOLDING AS UNDER: 7. THE FACTS OF THE CASE, SUBMISSION OF THE APPELL ANT AND REMAND REPORT OF THE AO HAVE BEEN GONE THROUGH. IN THIS CASE THE APPELLA NT HAS FILED RETURN OF INCOME OF 09-05-2016 BY DECLARING INCOME OF RS.2,02,00,0/- U/S 44AD OF THE ACT. THERE WERE CASH DEPOSITS OF RS.35,26,150/- IN SAVINGS BAN K ACCOUNT MAINTAINED BY THE APPELLANT WITH STATE BANK OF INDIA AND PUNJAB NATIO NAL BANK. IT WAS EXPLAINED THAT THE CASH DEPOSITS IN THE BANK ACCOUNT REFLECT AGRICULTURAL RECEIPTS FROM SALE OF CROPS, POPLAR TREES. THE AO HAS ESTIMATED THE AG RICULTURAL INCOME FROM THE APPELLANT FROM 65 BIGHAS OF LAND AT RS.325.000/- AN D HAS MADE THE ADDITION OF BALANCE AMOUNT OF RS.32,01,150/- AS UNEXPLAINED CAS H DEPOSITS U/S 69A OF THE ACT. THE AR DURING THE APPELLATE PROCEEDINGS HAS ST ATED THAT THE APPELLANT HAS EARNED INCOME FROM BUSINESS AND AGRICULTURAL ACTIVI TIES AND FURTHER STATED THAT THE APPELLANT HAS SHOWN BUSINESS RECEIPTS OF RS. 25 ,20,000/- FROM SALE OF SEEDS, MANURES, SEEDLINGS ETC ON WHICH PROFIT OF RS.2,02,0 00/- HAS BEEN SHOWN U/S 44AD OF THE ACT. THE AR ARGUED THAT THERE ARE FREQUENT C ASH WITHDRAWALS FROM THESE BANK ACCOUNTS WHICH ARE THE SOURCE OF SUBSEQUENT DE POSITS. THE AR ARGUED THAT THE AO HAS NOT GIVEN ANY BENEFIT OUT OF SUCH CASH W ITHDRAWALS. THE DETAILED SUBMISSION OF THE AR HAS BEEN REPRODUCED AS ABOVE. FROM THE FACTS OF THE CASE AND MATERIAL ON RECORD I T IS NOTED THAT THERE ARE FREQUENT CASH DEPOSITS/CASH WITHDRAWALS IN BOTH THE BANK ACCOUNTS OF THE APPELLANT. THE APPELLANT HAS SHOWN BUSINESS TURNOVE R OF RS.25,20,000/- IN THE RETURN OF INCOME ON WHICH INCOME OF RS.2,02,000/- H AS BEEN SHOWN U/S 44AD OF THE ACT. THE AO HAS NOT DISPUTED THESE FACTS. FROM THESE FACTS IT CAN BE LOGICALLY INFERRED THAT AMOUNT OF RS.35.26,150/- DEPOSITED IN THE BANK ACCOUNTS OF THE APPELLANT WAS ON ACCOUNT OF BUSINESS RECEIPTS OF TH E APPELLANT. THERE ARE FREQUENT CASH DEPOSITS AND WITHDRAWALS IN THE BANK ACCOUNTS OF THE APPELLANT. IN THESE CIRCUMSTANCES PEAK CREDIT THEORY SHOULD HAVE BEEN APPLIED BY THE AO TO COMPUTE THE INCOME OUT OF TRANSACTIONS RECORDED IN THE BANK STATEMENTS. ON THIS BASIS AFTER REDUCING OPENING BALANCE IN THE BANK AC COUNTS, THE PEAK CREDIT FOR BOTH THE BANK ACCOUNT WORKS OUT TO RS.9,50,343/-. T HE AO HAS HIMSELF ESTIMATED THE AGRICULTURAL INCOME OF THE APPELLANT AT RS.3250 00/-. AFTER GIVING CREDIT OF AGRICULTURAL INCOME OF RS.3,25,000/- AND BUSINESS I NCOME OF RS.2,02,000/-, THERE REMAINS UNEXPLAINED CREDIT OF RS.4,23,343/-. UNDER THE FACTS IT IS THEREFORE HELD THAT THE AO WAS JUSTIFIED TO MAKE ADDITION TO THE E XTENT OF RS.4,23,343/- WHICH IS UPHELD. THE BALANCE ADDITION IS HEREBY DELETED. GRO UNDS OF APPEAL NOS.2 TO 8 ARE HEREBY PARTLY ALLOWED. 7. AGGRIEVED BY THIS THE ASSESSEE IS IN APPEAL BEFORE THE ITAT. ITA NOS.:- 2107, 2111, 2112/DEL/2018 ABDULLAH SIDDIQUE. PAGE 4 OF 5 8. THE LD. SR. DR RELYING UPON THE IMPUGNED ORDER SUB MITTED THAT ALREADY MORE THAN ADEQUATE RELIEF HAS BEEN GRANTED TO THE A SSESSEE AND NOTHING IS PLACED ON RECORD TO JUSTIFY ANY FURTHER RELIEF. IT WAS SUBMITTED THAT EVEN IF THE ISSUE HAD TO BE DECIDED ON THE BASIS OF THE ESTIMAT ES, EVEN THEN THE GENERAL ARGUMENTS THAT THE CASH WITHDRAWALS CONSTITUTED THE SOURCE OF THE DEPOSITS WITHOUT ANY EVIDENCE CANNOT OUT RIGHTLY BE ACCEPTED . NOTHING HAS BEEN PLACED BEFORE THE ITAT TO ASSAIL THE SAID FINDING OR GRANT ANY FURTHER RELIEF. 9. I HAVE HEARD THE SUBMISSIONS AND PERUSED THE MATER IAL AVAILABLE ON RECORD, I FIND THAT THE LD. CIT(A) IN THE ORDER PAS SED HAS BEEN MORE THAN FAIR. THERE IS NO ARGUMENT, EVIDENCE OR FACT ON RECORD JU STIFYING ANY FURTHER RELIEF. ACCORDINGLY THE GROUNDS RAISED FOR WANT OF ANY JUST IFICATION FOR MODIFYING THE ORDER PASSED ARE REJECTED. THE FINDING UNDER CHALLE NGE IS UPHELD. SAID ORDER WAS PRONOUNCED ON THE OPEN COURT AT THE TIME OF HEA RING ITSELF. 10. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS DISMI SSED. 11. A PERUSAL OF FACTS IN ITA NO. 2111/DEL/2018 SHOW T HAT IN THE FACTS OF THE PRESENT CASE ALSO THE ASSESSEE HAD RETURNED AN INCO ME OF RS. 1,27,300/- PURSUANT TO NOTICE U/S 148 OF IT ACT. THE DEPOSITS OF RS. 35,73,000/- IN THE SAME SAVING BANK ACCOUNTS MAINTAINED WITH STATE BAN K OF INDIA AND PUNJAB NATIONAL BANK WERE REQUIRED TO BE EXPLAINED. 12. SIMILARLY, IN ITA NO. 2112/DEL/2018 IT IS SEEN THA T PURSUANT TO NOTICE U/S 148 OF IT ACT THE ASSESSEE RETURNED AN INCOME O F RS. 2,32,210/-. SIMILARLY, IN THE VERY SAME TWO BANK ACCOUNTS THE DEPOSITS AMO UNTING TO RS. 33,82,691/- WERE REQUIRED TO BE EXPLAINED. IN THE YEAR UNDER CO NSIDERATION ALSO THE ASSESSEE WAS FOUND TO HAVE PAID MBBS FEES FOR HIS D AUGHTER MISS SABIYA ABDULLAH AMOUNTING TO RS. 7,00,000/- PER ANNUM. 13. CONSIDERING SIMILAR EVIDENCES AND REASONS ADDITIONS MADE BY THE AO IN THE RESPECTIVE YEARS HAVE BEEN A SUBJECT MATTER OF PART RELIEF BY THE CIT(A). THE CIT(A) IT IS SEEN RELYING UPON THE VERY SAME REASON ING AND FACTS GRANTED PART RELIEF CONSIDERING THE PEAK CREDIT FOR BOTH THE ACC OUNTS IN THE RESPECTIVE YEARS AND RELYING UPON THE ESTIMATE OF THE AO OF THE AGRI CULTURAL INCOME. ACCORDINGLY, FOR SIMILAR REASONS AS SET OUT IN ITA NO. 2107/DEL/2018 FOR WANT ITA NOS.:- 2107, 2111, 2112/DEL/2018 ABDULLAH SIDDIQUE. PAGE 5 OF 5 OF ANY ARGUMENT, FACT OR EVIDENCE JUSTIFYING ANY FU RTHER RELIEF THE ASSESSEES APPEALS ARE DISMISSED. SAID ORDER WAS PRONOUNCED IN THE OPEN COURT AT THE TIME OF HEARING ITSELF. 14. IN THE RESULT, THE APPEALS OF THE ASSESSEE ARE DIS MISSED. SD/- (DIVA SINGH) JUDICIAL MEMBER DATED: 25.06.2019 BIDHAN/AG(CHD)/POONAM(CHD) COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR ITAT NEW DELHI DATE OF DICTATION 13.06.19 DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER 14.06.19 17.06.19 20.06.19 DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE OTHER MEMBER DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR. P S/PS DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE D ICTATING MEMBER FOR PRONOUNCEMENT DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR. PS/PS DATE ON WHICH THE FINAL ORDER IS UPLOADED ON THE WE BSITE OF ITAT DATE ON WHICH THE FILE GOES TO THE BENCH CLERK DATE ON WHICH THE FILE GOES TO THE HEAD CLERK THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT RE GISTRAR FOR SIGNATURE ON THE ORDER DATE OF DISPATCH OF THE ORDER