ACIT, Rohtak V. Sh. Anil Kumar Arya, Rohtak

ITA 212/DEL/2011

• Counselvise Citation: 21220114 RSA 2011
• Duration Of Justice: 1 year(s) 9 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-10-2012
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 10-10-2012
• Assessment Year: 2005-2006
• Appeal Filed On: 14-01-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAM BILASH MEENA
• Keywords: Additional evidence

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH : A : NEW DELHI BEFORE SHRI A.D. JAIN, JUDICIAL MEMBER AND SHRI T.S. KAPOOR, ACCOUNTANT MEMBER ITA NO.212/DEL/2011 ASSESSMENT YEAR : 2005-06 ACIT, ROHTAK CIRCLE, ROHTAK. VS. ANIL KUMAR ARYA, ARYA BHAWAN, ANAJ MANDI, ROHTAK. PAN : ACGPA1099M (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI NAVIN GUPTA, ADVOCATE REVENUE BY : SHRI RAM BILASH MEENA, SR.DR ORDER PER A.D. JAIN, JUDICIAL MEMBER THIS IS AN APPEAL FILED BY THE DEPARTMENT FOR ASSESSMENT YEAR 2005-06 AGAINST THE ORDER DATED 04.11.2010 PASSED BY T HE CIT (A), ROHTAK. THE FOLLOWING GROUNDS OF APPEAL HAVE BEEN T AKEN:- THE LD. CIT (A) HAS ERRED IN LAW AS WELL AS ON FA CTS OF THE CASE IN DELETING THE ADDITION OF RS.4,12,500/- WITHOUT O BTAINING ANY AUTHENTIC DOCUMENTARY EVIDENCE FROM THE ASSESSEE. IT WAS OBLIGATORY ON THE PART OF THE ASSESSEE TO FURNISH NECESS ARY AUTHENTIC DOCUMENTARY EVIDENCE IN RESPECT OF SALE OF 3 TRUCKS CLAIMED BY HIM. BUT THE ASSESSEE HAS FAILED TO DO SO. THEREFORE, THE ASSESSEE HAS NOT DISCHARGED HIS ONUS. 2. THE LD. CIT (A) HAS ERRED IN LAW AS WELL AS ON FATS OF THE CASE IN DELETING THE ADDITION OF RS.16,73,643/- BECAUSE TH E ASSESSEE FAILED TO EXPLAIN SOURCES OF DEPOSITS MADE IN THE BANK ACCOUNTS AND UTILIZATION OF WITHDRAWALS MADE BY HIM. IT WAS OBL IGATORY ON THE PART OF THE ASSESSEE TO DISCLOSE ALL THE NECESSARY F ACTS WHICH WERE COMPULSORY FOR THE COMPLETION OF ASSESSMENT OF TH E ASSESSEE. BUT THE ASSESSEE HAS AVOIDED TO FURNISH COM PLETE ITA NO.212/DEL/2011 2 EXPLANATION OF EACH AND EVERY ENTRY ORDER OF THE HIS B ANK ACCOUNTS. THE ASSESSEE HAS FAILED TO FURNISH AUTHENTIC DOCUMENTARY EVIDENCE REGARDING SOURCES OF DEPOSITS IN HIS BANK ACCOUNTS. 2. APROPOS GROUND NO.1, THE RELEVANT FACTS AS AVAILABL E FROM THE CONCERNED ORDERS ARE THAT THE ASSESSEE, DURING THE YEAR, WAS ENGAGED IN THE BUSINESS OF PLYING OF TRUCKS/TANKERS TO VARIOUS O IL COMPANIES AND DERIVED INCOME FROM HOUSE PROPERTY ALSO. HE DECLARED INCOME ON NINE TRUCKS/TANKERS OWNED BY HIM UNDER THE PROVISIONS OF SEC TION 44AE OF THE IT ACT. IT WAS CLAIMED THAT OUT OF EIGHT TRUCKS THE ASSESSEE HELD, THREE HAD BEEN SOLD OFF AND FOUR HAD BEEN PURCHASED D URING THE YEAR, ATTRACTING THE PROVISIONS OF SECTION 44AE OF THE ACT. THE ASSESSING OFFICER, HOWEVER, OBSERVED THAT THE ASSESSEE HAD EIGHT T RUCKS AS ON 01.04.2004 AND HAD CLAIMED PURCHASE OF FOUR TRUCKS AN D SALE OF THREE TRUCKS DURING THE YEAR; THAT THE ASSESSEE HAD NOT FURNI SHED EVIDENCE REGARDING THE SALE OF THREE TRUCKS; AND THAT THE ASSESSEE COULD NOT FURNISH THE REGISTRATION CERTIFICATES (RCS) OF ALL TH E TRUCKS AND OTHER EVIDENCE OF OWNING THE TRUCKS. THE CLAIM OF THE ASSESSE E THAT HE OWNED NOT MORE THAN TEN TRUCKS WAS, THEREFORE, REJECT ED BY THE ASSESSING OFFICER AND IT WAS HELD THAT THE PROVISIONS OF S ECTION 44AE OF THE ACT DID NOT GET ATTRACTED. THE ASSESSING OFFICER E STIMATED THE PROFIT OF THE ASSESSEE AT 10% ON THE ASSESSEES GROSS RECEIPT S OF ` 79,05,100/-, AS IT WAS A CASE OF NO BOOKS OF ACCOUNT. THE ASSESSEE HAD DECLARED INCOME OF ` 3,78,000/-. THE ASSESSING OFFICER REDUCED THIS FROM THE FIGURE OF ` 7,90,500/- AND MADE ADDITION OF ` 4,12,500/-. 3. THE LD. CIT (A) DELETED THIS ADDITION, GIVING RISE TO GROUND NO.1 TAKEN BY THE DEPARTMENT BEFORE US. 4. IN THIS REGARD, THE LD. DR HAS CONTENDED THAT THE LD. CIT (A) HAS ERRED IN DELETING THE ADDITION OF ` 4,12,500/- CORRECTLY MADE BY THE ASSESSING OFFICER; AND THAT IN DOING SO, THE LD. CIT (A) ERRED IN NOT ITA NO.212/DEL/2011 3 OBTAINING ANY AUTHENTIC DOCUMENTARY EVIDENCE FROM T HE ASSESSEE, WHICH IT WAS THE OBLIGATION OF THE ASSESSEE TO FURNISH R EGARDING THE SALE OF THREE TRUCKS AS CLAIMED BY HIM. 5. THE LD. COUNSEL FOR THE ASSESSEE, ON THE OTHER HAND, HAS PLACED STRONG RELIANCE ON THE IMPUGNED ORDER IN THIS REGARD. OUR ATTENTION HAS BEEN DRAWN TO PAGES 141-142 OF THE ASSESSEES PAPER BO OK (APB, FOR SHORT). THIS IS A COPY OF THE QUESTIONNAIR E DATED 13.10.2007 ISSUED TO THE ASSESSEE BY THE ASSESSING OFFICER. IT IS POINTED OUT THAT ITEMS (VI) AND (VII) AT APB PAGE 14 2 REQUIRED THE ASSESSEE TO PRODUCE THE NAMES AND COMPLETE POSTAL ADDRESSES OF THE PERSONS FROM WHOM THE TRUCKS HAD BEEN PURCHASED BY THE ASSESSEE AND TO WHOM THEY HAD BEEN SOLD DURING THE YEAR, AND COPIES OF RCS IN RESPECT OF THE TRUCKS OWNED BY THE ASSESSEE, PURCHASED AN D SOLD DURING THE YEAR. THEN, WE HAVE BEEN TAKEN THROUGH THE ASSESSEES REPLY AT APB 144-146. IT HAS BEEN POINTED OUT THAT VIDE ITEMS (VI) AT PAGE 145, THE ASSESSEE HAS STATED TO HAVE ATTACHED WITH T HE SAID REPLY, THE DETAILS OF THE PERSONS FROM WHOM THE TRUCKS WERE PURCHASED AND TO WHOM THEY WERE SOLD; THAT UNDER ITEM (VII), I T HAS BEEN STATED THAT THE RCS ARE LEGALLY TO BE KEPT WITH THE TRUCKS A ND, AS SUCH, THE ASSESSEE WAS UNABLE TO PRODUCE THEM BEFORE THE ASSESSING OFF ICER. THEN, ATTENTION HAS BEEN DRAWN TO APB 146, WHICH CON TAINS THE DETAILS OF THE TRUCKS SOLD DURING THE PERIOD FROM 01.04.2004 TO 31.03.2005 AND THE DETAILS OF THE TRUCKS PURCHASED. IT HAS BEEN STATED THAT APB 54 IS THE ASSESSEES WRITTEN SUBMISSION DATED 02.06.2009 BEFORE T HE LD. CIT (A), ALONG WITH WHICH AT APB 55-139, THE COPIES OF R CS OF THE TRUCKS OF THE ASSESSEE HAVE BEEN APPENDED ALONG WITH THE ITRS AND COMPUTATIONS OF INCOME OF THE PURCHASERS OF THE TRUCKS. THE LD. COUNSEL FOR THE ASSESSEE HAS CONTENDED THAT IN THIS MANNER , THE ASSESSEE HAS DULY DISCHARGED HIS ONUS OF PROVING THAT DURI NG THE YEAR ITA NO.212/DEL/2011 4 HE HAD SOLD THREE TRUCKS AND OWNED NINE TRUCKS, CLEARL Y ATTRACTING THE PROVISIONS OF SECTION 44AE OF THE ACT. 6. WE HAVE CONSIDERED THE RIVAL CONTENTIONS OF THE PA RTIES ON THIS ISSUE. IT IS SEEN THAT SO FAR AS REGARDS THE SALE OF THR EE TRUCKS DURING THE YEAR, AS CLAIMED BY THE ASSESSEE, THE ASSESSEE HAD FURNI SHED ALL POSSIBLE EVIDENCE. THE NAMES AND COMPLETE POSTAL ADDRE SSES OF THE PERSONS FROM WHOM THE TRUCKS WERE PURCHASED AND TO WHOM THE SAME WERE SOLD, WERE FILED. THE ASSESSING OFFICER, HOWEVER, DID NOT CARRY OUT ANY INQUIRY FROM THESE PERSONS. THE ASSESSEES CLAIM W AS REJECTED ONLY FOR THE ABSENCE OF RCS OF THE TRUCKS SOLD. BEFOR E THE LD. CIT (A), BESIDES THE RCS, THE DETAILS OF PURCHASE AND SALE, INCOM E-TAX RETURNS, COMPUTATIONS OF INCOME OF THE PURCHASERS OF THE TRUCK S AND AFFIDAVITS WERE FILED. THE LD. CIT (A) ASKED FOR A REMAND REPO RT FROM THE ASSESSING OFFICER IN THIS REGARD. EVEN IN HIS REMAND REP ORT, THE ASSESSING OFFICER DID NOT SHOW ANY EXAMINATION OF THE PU RCHASERS HAVING BEEN CONDUCTED. THE LD. CIT (A), THUS, IN OU R OPINION, CORRECTLY HELD THAT THE SALE OF THE TRUCKS STOOD PROVED FROM TH E RCS EVIDENCING THE TRANSFER OF THE TRUCKS AND THAT IT WAS NOT PROPER TO REJECT THE AFFIDAVITS OF THE PURCHASERS WITHOUT EXAMINING THEM. 7. MOREOVER, AS CONSIDERED BY THE LD. CIT (A), IN THE CASE OF THE ASSESSEE FOR ASSESSMENT YEAR 2001-02 DISMISSING THE SLP OF TH E DEPARTMENT, THE HONBLE SUPREME COURT HAS UPHELD THE APPLICABILITY OF THE PROVISIONS OF SECTION 44AE OF THE ACT TO THE ASSESSE E. 8. IN THESE FACTS, WE FIND THE ORDER OF THE LD. CIT ( A) ON THIS ISSUE TO BE A WELL VERSED AND REASONED ORDER. THE DEPARTMENT H AS REMAINED UNABLE TO UNHINGE THE FINDINGS RECORDED BY THE LD. C IT (A), WHICH WE HEREBY CONFIRM. GROUND NO.1 RAISED BY THE DEPARTMEN T IS, THUS, REJECTED. ITA NO.212/DEL/2011 5 9. COMING TO GROUND NO.2, THE ASSESSING OFFICER FOUND D EPOSITS OF ` 95,78,743/- IN THE THREE BANK ACCOUNTS MAINTAINED BY THE ASSESSEE. THE ASSESSING OFFICER HELD THAT THE ASSESSEE COULD NOT EXPL AIN THE ENTRIES IN THE SAID DEPOSITS. HE, THEREFORE, GAVE CRED IT OF THE TURNOVER OF THE ASSESSEE OF ` 79,05,100/-, DERIVED FROM TDS CERTIFICATES, FROM THE TOTAL DEPOSITS IN THE BANK ACCOUNTS, AMOUNTING TO ` 95,78,743/-. THE ASSESSING OFFICER, THUS, ADDED AN AMOUNT OF ` 16,73,643/- AS UNEXPLAINED DEPOSITS OF THE ASSESSEE. 10. THE LD. CIT (A) DELETED THIS ADDITION ALSO, DUE T O WHICH, GROUND NO.2 HAS BEEN TAKEN BY THE DEPARTMENT BEFORE US. 11. THE LD. DR HAS CONTENDED THAT THE LD. CIT (A) HA S ERRED IN DELETING THE ADDITION CORRECTLY MADE BY THE ASSESSING O FFICER; THAT WHILE DOING SO, THE LD. CIT (A) FAILED TO APPRECIATE THAT THE ASSESSEE HAD MISERABLY FAILED TO EXPLAIN THE SOURCES OF THE DEP OSITS IN HIS BANK ACCOUNTS AND UTILIZATION OF THE WITHDRAWALS MADE BY H IM; THAT IT WAS OBLIGATORY ON THE PART OF THE ASSESSEE TO DISCLOSE ALL TH E NECESSARY FACTS, BUT THE ASSESSEE FAILED TO FURNISH THE COMPLETE EX PLANATION OF EACH AND EVERY ENTRY IN HIS THREE BANK ACCOUNTS; THAT THE ASSESSEE FAILED TO FURNISH AUTHENTIC DOCUMENTARY EVIDENCE REG ARDING THE SOURCES OF THE DEPOSITS IN HIS BANK ACCOUNTS; AND THAT TH E LD. CIT (A) HAS ILLEGALLY DELETED THE ADDITION DESPITE THESE DISCRE PANCIES IN THE CASE OF THE ASSESSEE. 12. PER CONTRA , THE LD. COUNSEL FOR THE ASSESSEE, SUPPORTING THE IMPUGNED ORDER ON THIS ISSUE, HAS CONTENDED THAT NO SPE CIFIC SHOW CAUSE NOTICE WITH REGARD TO THE PROPOSED ADDITION WAS ISSUED TO THE ASSESSEE BY THE ASSESSING OFFICER; THAT THE ASSESSEE IS COVERED UNDER THE PROVISIONS OF SECTION 44 AE OF THE ACT; THAT BEFO RE THE LD. CIT (A), ITA NO.212/DEL/2011 6 THE DIFFERENCE OF ` 17 LAC WAS DULY EXPLAINED; THAT THE ADDITIONAL EVIDENCE FILED BY THE ASSESSEE, I.E., PERTAINING TO CON FIRMATION OF LOAN TAKEN, WAS DULY REFERRED BY THE LD. CIT (A) TO THE A SSESSING OFFICER; THAT IN THE REMAND REPORT, THE ASSESSING OFFICER STATED THAT SINCE THE ASSESSEE COULD NOT PRODUCE THE COPY OF BANK ACCOUNT, TH E GENUINENESS OF THE LOAN REMAINED DOUBTFUL; AND THAT THE LD. CIT (A) HAS DULY TAKEN INTO CONSIDERATION THE CORRECT ATTENDING FACTS. 13. QUA THIS ISSUE, IT IS SEEN THAT THE ASSESSING OFFICER MADE TH E ADDITION FOR THE REASON THAT THE ASSESSEE COULD NOT EXP LAIN EACH AND EVERY ENTRY REGARDING THE DEPOSITS IN HIS THREE BANK ACCOUNTS. BEFORE THE LD. CIT (A), BY WAY OF ADDITIONAL EVIDENCE, THE ASSESSEE FILED CONFIRMATION OF LOAN OF ` 17 LACS, TAKEN FROM M/S ARYA BULK CARRIER. THE ASSESSING OFFICER, IT IS SEEN, AS CORRECTLY OBSERVED BY THE LD. CIT (A), JUST TOTALED THE DEPOSITS IN THE THREE BANK ACCOUNTS OF THE ASSESSEE AND, GIVING CREDIT FOR THE CONTRACT RECEIPTS, MADE A DDITION OF ` 16,73,643/- AS UNEXPLAINED DEPOSITS. THE BANK TRANSACT IONS WERE NOT PROPERLY EXAMINED BY SEGREGATING THEM. DESPITE THE C ONFIRMATION FILED BY THE ASSESSEE BEFORE THE LD. CIT (A) HAVING BE EN REFERRED TO HIM, THE ASSESSING OFFICER DID NOT DEEM IT PROPER TO EX AMINE THE CREDITOR. UNDISPUTEDLY, M/S ARYA BULK CARRIER, THE C REDITOR OF THE ASSESSEE, WAS ASSESSED TO TAX IN ROHTAK. THE LD. CIT (A) HA S CORRECTLY TAKEN INTO CONSIDERATION THE FACT THAT CREDIT FOR TH E SOURCES OF THE DEPOSITS, I.E., ` 17 LACS RECEIVED AS LOAN FROM M/S ARYA BULK CARRIER ( OUT OF WHICH ` 7 LAC WAS DEPOSITED ON 19.08.2004 AND ` 10 LAC WAS DEPOSITED ON 15.09.2004 IN THE SBI ACCOUNT OF THE ASSE SSEE), CHEQUES TO THE TUNE OF ` 1,08,524/- DRAWN ON ABN AMRO BANK, DISHONOURED DUE TO STOP PAYMENTS, CONTRA ENTRIES OF ` 80,000/-, POSTED DUE TO AUTO SWEEP FACILITY IN ICICI BANK, AND CASH DEPOSITS AND CASH WITHDRAWALS IN AND FROM THE ASSESSEES BANK ACCOUNTS, OF WHICH CREDITS FO R DEPOSITS OUT OF THE WITHDRAWALS MADE EARLIER, AMOUNTING TO A BENEFIT OF TOTAL ITA NO.212/DEL/2011 7 CASH WITHDRAWALS OF ` 12.50 LACS, WAS NOT GIVEN BY THE A.O. THE DEPARTMENT HAS REMAINED UNABLE TO REBUT THE FACTUAL FINDING RECORDED BY THE LD. CIT (A) TO THE EFFECT THAT THE RENTAL IN COME OF THE ASSESSEE, AMOUNTING TO ` 1.76 LACS AND THE ASSESSEES PROFIT OF ` 3.78 LAS FROM PLYING OF TRUCKS, AS DECLARED U/S 44AE OF THE ACT, WE RE SUFFICIENT TO COVER THE DEFICIT ARRIVED AT BY THE ASSESSING OFFICER, AMOUNTING TO ` 16,73,643/-. 14. IN THESE FACTS, AGAIN, THE ORDER PASSED BY THE LD. CIT (A) ON THIS ISSUE IS FOUND TO BE WITHOUT ANY FAULT AND IT IS HEREBY CONFIRMED. ACCORDINGLY, GROUND NO.2 STANDS REJECTED. 15. IN THE RESULT, THE APPEAL FILED BY THE DEPARTMEN T IS DISMISSED. THE ORDER PRONOUNCED IN THE OPEN COURT ON 26.10.20 12. SD/- SD/- [T.S. KAPOOR] [A.D. JAIN] ACCOUNTANT MEMBER JUDICIAL MEMBER DATED, 26.10.2012. DK COPY FORWARDED TO: - 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR, ITAT TRUE COPY BY ORDER, DEPUTY REGISTRAR, ITAT, DELHI BENCHES