INCOME TAX OFFICER WARD-30(1)(4), MUMBAI V. SHRI HARSHAD A BORADIA, MUMBAI

ITA 2149/MUM/2018

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 5367 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 1 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-05-2019
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: H
• Assessment Year: 2011-2012
• Appeal Filed On: 06-04-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Unexplained cash credit; Business income; Income from undisclosed sources; Corroborative evidences; TDS
• Section: 143(3); 250

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH H, MUMBAI BEFORE JUSTICE(R) SHRI P.P.BHATT, PRESIDENT AND SHRI G.S. PANNU, VICE PRESIDENT ITA NO. 2149/MUM/2018 : (A.Y : 2011-2011) ITO, WARD 30(1(4) MUMBAI. (APPELLANT) VS. SHRI HARSHAD A BARADIA, 5/6, DADAMIYA CHAWL, QUARRY ROAD, OPP. LIPCO CO. MALAD (E), MUMBAI. PAN : AEHPB 3175 L (RESPONDENT) APPELLANT BY : SHRI SAURABH KUMAR RAI, DR RESPONDENT BY : SHRI BHUPENDRA SHAH, AR DATE OF HEARING : 15/04/2019 DATE OF PRONOUNCEMENT : 31/05/2019 O R D E R PER G.S. PANNU, VP : THE CAPTIONED APPEAL FILED BY THE REVENUE PERTAINI NG TO ASSESSMENT YEAR 2011-12 IS DIRECTED AGAINST AN ORDER PASSED BY CIT(A)-41, MUMBAI DATED 1.1.2018, WHICH IN TURN ARISES OUT OF AN ORDE R PASSED BY THE ASSESSING OFFICER UNDER SECTION 143(3) OF THE INCOME TAX ACT, 1961 (IN SHORT THE ACT) DATED 28.3.2014. 2. THE REVENUE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL: 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE AND IN LAW, THE CIT(A) ERRED IN GIVING RELIEF OF RS.70,48,413/- WITH RESPECT TO THE ADDITION MADE U/S.68 OF RS.75,48,413/- WITHOUT CONSIDERING THE FACTS IN THE REMAND REPORT AND MERELY RELYING O N THE ASSESSEES REJOINDER. 2 2149/MUM/2018 ASST.YEAR: 2011-12 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, THE CIT(A) HAS ERRED IN DELETING THE ENTIRE ADDITIO N OF RS.29,24,520/- ADDED AS UNDISCLOSED RECEIPTS, WITHO UT RELYING ON THE FACTS, THAT THE ASSESSEE WAS UNABLE TO PRODUCE THE EVIDENCE DURING THE ASSESSMENT PROCEEDINGS. 3. APROPOS GROUND NO.1 OF APPEAL, THE RELEVANT MAT ERIAL FACTS, AS EMANATED FROM THE CIT(A)S ORDER, ARE THAT DURING T HE COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER OBSERVED FROM TH E AIR INFORMATION THAT THE ASSESSEE HAS DEPOSITED CASH OF RS.14,28,500/- I N THE ACCOUNT OF BANK OF INDIA AND RS.44,99,000/- IN THE ACCOUNT OF KOTAT MA HINDRA BANK LTD., RESPECTIVELY DURING THE ASSESSMENT YEAR UNDER CONSI DERATION. IN THE PROFIT AND LOSS ACCOUNT, THE ASSESSEE HAS SHOWN INCOME OF RS.1,92,71,587/- OUT OF BUS TICKET BOOKING. HENCE, THE ASSESSING OFFICER RE QUIRED THE ASSESSEE TO EXPLAIN THE SOURCES OF DEPOSITS. IN REPLY, THE ASS ESSEE SUBMITTED THAT THE RECEIPTS OF THE TRAVEL BUSINESS WERE IN CASH AND S AME WAS DEPOSITED IN THE BANKS TO CLEAR THE EMI OF LOANS TAKEN FOR PURCHASE OF THE BUSES. THEREAFTER THE ASSESSING OFFICER ASKED THE ASSESSEE TO SUBMIT THE DETAILS OF BUS TICKETS SOLD TO SUBSTANTIATE THE BOOKING OF BUS TICKET OF RS.1,92,71,587/-, WHICH WAS NOT COMPLIED WITH. IN VIEW OF ABOVE, THE ASSESSING OFFICER AFTER CONSIDERING THE AVERAGE FARE OF VOLVO BUS AND ORDINARY NON-AC B US, WORKED THE TOTAL TICKET COLLECTION OF THE YEAR AT RS.4,05,00,000/- A ND ISSUED A SHOW CAUSE NOTICE TO THE ASSESSEE AS TO WHY THE DIFFERENCE OF RS.2,12,28,413/- (RS.4,05,00,000/- - RS.1,92,71,587/-) SHOULD NOT TR EATED AS UNEXPLAINED CASH CREDIT U/S.68 OF THE ACT. 4. THE ASSESSEE SUBMITTED THAT CONSIDERING THE DIST ANCE TO AND FRO FROM MUMBAI TO HYDERABAD/BANGALORE, ONLY 12 TRIPS PER MO NTH COULD BE PERFORMED IN VOLVO BUSES AND THE TICKET RATE BEING RS.650/- CALCULATED THE RATE AT RS.1,46,25,000/- . AS FAR AS NON-AC BUSES, IT WAS SUBMITTED THAT SINCE 3 2149/MUM/2018 ASST.YEAR: 2011-12 THE BUSES WERE 4 TO 5 YEARS OLD, THEY WERE USED FOR PICNICS, MARRIAGES AND OTHER SHORT TRIPS AND CALCULATED THE COLLECTION AT RS.43,20,000/-. THUS, THE TOTAL BUS TICKET COLLECTION WAS CALCULATED TO RS.1, 89,45,000/-. HOWEVER, IN THE ABSENCE OF ANY DOCUMENTARY EVIDENCE, THE ASSESS ING OFFICER GATHERED THE INFORMATION FROM THE INTERNET AND, ACCORDINGLY, WORKED OUT RS.2,68,20,000/- FOR BOTH THE VOLVO AND ORDINARY BU SES AND ADDED THE DIFFERENTIAL AMOUNT OF RS.75,48,413/- (RS.2,68,20,0 00/- - RS.1,92,71,587/-) TO THE INCOME OF THE ASSESSEE U/S.68 OF THE ACT. 5. ON APPEAL, THE CIT(A) CALLED A REMAND REPORT FRO M THE ASSESSING OFFICER, WHEREIN, IT IS STATED AS UNDER: 9.1 BEFORE THE CIT(A) THE ASSESSEE HAS SUBMITTED C ERTAIN DOCUMENTS WHEREIN, IT STATED THAT TWO OF THE VEHICLES WERE NO T PUT INTO USE AND A NO USE CERTIFICATE HAS BEEN ISSUED BY THE RTO, THAN E. 9.2. IN THE AFFIDAVIT DATED 18.3.2014, THE ASSESSEE HAS STATED THAT ALL DOCUMENTS ARE LOST AND THEY DID NOT HAVE DETAILS TO SUBMIT. THE ASSESSEE DID NOT SUBMIT ANY DETA IL S AT THA T T I ME . FUR T HER THE ASSESSEE HAS STATED IN H I S LETTER DATED 10 TH AUGUST, 2015 SUBMITTED BEFORE THE LEA R NED CIT ( A ) THAT I T WAS DUE TO PAUC I TY OF TIME . 9 . 3 HERE , IT I S TO BE NOTED THAT I F TH I S DOCUMENT COULD BE FOUND BY THE ASS ES SEE, T HEN OTHER DOCUMENTS SHOULD BE SOME WHERE WITH THE ASSESSEE WH I C H ASSESSEE DELIBERATELY WANTED TO H I DE . THE ASSESSEE HAS GIVEN A FALSE A FF I DAVIT STAT I NG THE DOCUMENTS ARE MISSING . 9 . 4 A LETTER DATED 18 . 08 . 2017 WAS I SSUED AND SERVED ON THE ASSESSEE TO SUB MIT THE DETAILS CAL L ED FOR AS PER THE LETTER BY 24 . 08 . 20 1 7 . ON 28 . 08 . 2017 , THE ASSESSEES SON SHR I RITESH BARODIA WHO NOW L OOKS AFTER THE BUS I NESS TELEPHONED AND STA T ED TH AT DUE TO SOME CALAM IT Y I N THE FAM I LY FRONT , HE WIL L BE COMING TO O F F I CE ON 0 1 . 09 . 2017 AND ASKED FOR SOME TIME . THE SAME WAS GIVEN TO HIM . ON 01 . 09 . 20 17. S H R I R I TESH BAROD I A ATTENDED AND SUBM IT TED A LETTER DATED 24 . 08 . 2017 .THE CASE WAS HEARD. WAS HEARD . THE ASSESSEE ' S R EP L Y CANNOT BE RE LI ED UP ON DUE TO FO L LOWING REASONS : 9 . 5 AS PER THE SUBM I SS I ONS MADE BY THE ASSESSEE BEFORE THE LD . CIT ( A) MUMBA I , THE BUS NUMBER MH-04-G-8090 WAS NOT IN USE F R OM 4 2149/MUM/2018 ASST.YEAR: 2011-12 JANUARY , 201 1 APR IL , 201 1 . THAT MEANS FO R THE A . Y . 2011 - 12 THIS BUS WAS NOT IN USE FOR THREE MONTHS JANUARY , 201 1 T O MA R CH 201 1. AND BUS NO : M04-G-8081 WAS NOT I N F ROM FEBRUARY , 2010 TO J UNE 2010 . THAT MEANS FOR A . Y 2011 THE F . Y YEAR BEING 20 1 0 - 11 START I NG FORM 01 . 04.2010 TO 31.03.2011 , THIS BUS WAS NOT I N USE FOR PER I OD OF 3 MONTHS ON L Y AND N OT FOR 5 MONTHS . 9 . 6 FURTHE R, THE ASSESSEE HAS A L SO SUBM I TTED COPY OF T I CKETS . T I CKE T NO . 1 32 (B Y EAG L E T R AVE L AGENCY DATED 05 . 09 . 2010 J OURNEY DATE 08 . 09 . 2010 FOR T OTA L SEA 2 , WHERE I N THE RATE IS MENTIO N ED AT RS . 1200/- FOR T R AVELL I NG FROM MUMBAI HYDERABAD . TI CKET NUMBE R 69502 I SSUED BY NEETA VO L VO BUS ON 08 . 02 . 2 011 FOR RS . 1900 TOTA L SEATS 3 SEAT NO E , F , G F R OM S I ON TO HYDE R ABAD AND T I C K E T N O 1 55 ( I SSUED ON 02 . 05 . 2010 FOR RS . 1 300 FO R 2 SEATS Y AND Z. 9 . 7 IT I S SE EN F R O M T H E SE THR EE COP I ES O F T I C K ETS S UBMITT ED BY THE ASSESSEE ON THREE DIFFERENT DATES AND MONTHS I.E. SEPTEMBER 2010, MAY, 2010 AND FEBRUARY, 2011, WHERE IN ALL THE CHAR GES ARE ABOVE RS.1000/- (I.E. RS.1200/-, RS1900/- AND RS.1300/-). WHEREAS AS THE AO HAS TAKEN AT AN AVERAGE OF RS.1000/-. THE ASSES SEE S U BMITT ED COPY OF THREE B ILL S FOR THREE DIFFERENT DATES WHEREIN THE 2 BILLS AMOUN T S FOR 2 SEATS AND ONE B IL L FO R 3 SEATS HAVE BEEN MENTIONED . THE ASSESSES S H O UL D H AVE PRODUCED AT LEAST FOUR TO F I VE MONTHS BILLS OR AT LEAST ONE MONTH BI L LS TO T AK E AN AVERAGE RATE . BY SUBM I TT I NG COP I ES OF 3 BILLS THE ASSESSEE HAS ASKED THE A O TO ARRIVE AT THE MAGIC F I GURE OF RS . 600 TO 700 PER TICKET . FROM THE SUBMISSIONS OF TH E ASSESSEE THE CLA I MS OF AVERAGE TICKET PR I CE AT RS. 600 TO 700 , WH I CH CANNOT BE ACCEPTED . FURTHER FROM THE I NFORMATION R ECE I VED FROM I NTERNET ON COMPUTER , I T WAS SEEN THAT T HE FARE OF THE VOLVO BUS TRAVEL BETWEEN MUMBA I TO BANGALORE OF KA R NATAKA STA T E ROAD TRANSPOR T CORPO R AT I ON WAS @ RS . 1020PERPASSENGER . EVEN OTHER TRAVE L AGENC I ES LI KE SHARMA T R AVE L, KONDUSKAR.TRAVE L CHARGED THE SAME RATE WITH SOME I NCREASE I N RATE DUR I NG THE SUMMER AND D I WAL I VACAT I ON FOR VO L VO BUS . 9 . 8 HOWEVER , KEEPING IN VIEW OF THE ASSESSEE ' S CLAIM FOR NO USE CERTIFICATE FOR THE TWO VEHICLES I N QUESTION , THE COLLECTION OF TICKETS SOLD DURING THE YEAR FOR AC VOLVO BUSES I S RECALCULATED AS UNDER AS REDUCED BY NUMBER OF MONTHS THE VEH I CLES NOT PUT I NTO USE : 45 SEATS X RS . 1000 PER SEAT X 2 NO . OF BUS RS . 90 , 000 RS . 9000 X 250 ( NO . OF TR I PS ) = 2 , 25 , 00 , 000 ( 250 TRIPS = 250 DAYS WHICH ISLES THAN 9 MONTHS . ) 9 . 9 FROM THE ABOVE IT IS CLEAR THAT THE AO HAS ALREAD Y TAKEN INTO ACCOUNT THE NO USE CERTIFICATE AND ACCORDINGLY HAS TAKEN THE NO. OF DAYS AT 250 (30 DAYS X 9 NO. OF MONTHS =270) AND FURTHER GIVEN ANOTHER 20 DAYS FOR REPAIR WORK ETC. 9.10 THEREFORE, THE TOTAL RECEIPT OF BUS TICKET BOO KING INCOME OF THE ASSESSEE DURING THE F.Y. 2010-2011 IS RS.2,68,20,00 0/- = RS.2,25,00,000 + RS.43,20,000 (FOR TWO NON A.C. BUS ES) 9.11. ACCORDINGLY, THE DIFFERENCE IN TOTAL RECEIPT OF BUS TICKET BOOKING INCOME SHOWN BY THE ASSESSEE IN P&L ACCOUNT AND WOR KING DONE IS AS 5 2149/MUM/2018 ASST.YEAR: 2011-12 UNDER: RS.2,68,20,000 (-) RS.1,92,71,587/- = RS.75,48,413/ -. THEREFORE, THE UNDISCLOSED INCOME OF RS.75,48,413/- AS CASH CREDIT OF THE ASSESSE AND DISALLOWED /S.68 OF THE I .T.ACT, 1961 IS FULLY JUSTIFIED. 6. THE REMAND REPORT OF THE ASSESSING OFFICER WAS F URNISHED TO THE ASSESSEE AND THE ASSESSEE HAS SUBMITTED REJOINDER T O REMAND REPORT. AFTER CONSIDERING THE REMAND REPORT AND THE REJOIND ER, THE CIT(A) ALLOWED PART RELIEF TO THE ASSESSEE BY OBSERVING AS UNDER: 11. I HAVE CAREFULLY GONE THROUGH THE SUBMISSIONS OF TH E APPELLANT AND THE FINDINGS OF THE ASSESSING OFFICER IN THE ASSESS MENT ORDER AND THE REMAND REPORT. MY OBSERVATIONS ARE AS UNDER: 11.1 IN MY CONSIDERED OPINION, THE FINAL OUTCOME OF THIS APPEAL DEPENDS UPON FEW FACTUAL ASPECTS THAT NEED TO BE RE SOLVED. FIRSTLY, WHETHER THE VOLVO BUSES OF THE APPELLANT WERE PLYIN G BETWEEN MUMBAI AND HYDERABAD OR MUMBAI AND BANGALORE OR MIXED. SEC ONDLY, FOR HOW MANY NO. OF DAYS (AVERAGE) IN A MONTH, THE BUSES HA VE TRAVELLED BETWEEN MUMBAI OR HYDERABAD/ BANGALORE I.E., TIME T AKEN IN ONE TRIP BETWEEN TWO DESTINATIONS. THIRDLY, WHAT IS THE RATE FOR A TRIP BETWEEN MUMBAI AND HYDERABAD/MUMBAI IN A VOLVO BUS. IN THE SUBSEQUENT PARAGRAPHS, THESE ISSUES BEEN DISCUSSED BASED ON FA CTS AND EVIDENCES BROUGHT ON RECORD AND AFTER 'CONSIDERING THE CONCLU SION DRAWN BY THE AO AND AS ARGUED BY THE LD. AR OF THE /APPELLANT 11.2 THE FIRST ISSUE TO BE DECIDED IS WHETHER THE T WO VOLVO BUSES OF THE APPELLANT WERE PLYING BETWEEN MUMBAI AND HYDERABAD OR MUMBAI AND BANGALORE OR MIXED. THROUGH OUT THE ASSESSMENT PROC EEDINGS, THE APPELLANT HAS NOT TAKEN A DEFINITE STAND ON THE DES TINATION OF THE TWO VOLVO BUSES DURING THE YEAR UNDER CONSIDERATION. IN THE ABSENCE OF PROPER RECORDS MAINTAINED AND PRODUCED BEFORE THE A O DURING THE ASSESSMENT PROCEEDINGS, THE AO HAS ASSUMED THAT THE BUSES ARE PLYING BETWEEN MUMBAI AND BANGALORE. IT IS ONLY DURING THE APPELLATE PROCEEDINGS, THE APPELLANT HAS SUBMITTED A CERTIFIC ATE DATED 22.05.2015 FROM NEETA TRAVELS ABOUT THE USE & DESTINATION OF THE TWO VOLVO BUSES. THE CONTENT OF THE CERTIFICATE IS AS UNDER: THIS IS TO CERTIFY THAT DURING THE YEAR 2010-11 V OLVO BUSES NO;- MH 04G8090 AND MH 04G8081 OWNED BY MR. HARSHAD A. BORA DIA WERE OPERATING ON MUMBAI-HYDERABAD ROUTE AS DAILY BUS SE RVICE AS WE WERE THE MAIN BOOKING AGENTS THROUGH WHOM SEATS WERE BOO KED. THE AVERAGE TICKET PRICE WAS BETWEEN RS. 600 TO 700 DEP ENDING UPON THE SEASON .' 6 2149/MUM/2018 ASST.YEAR: 2011-12 THIS CERTIFICATE SUGGESTS THAT THE 2 VOLVO BUSES HA VE TRAVELLED TO HYDERABAD DURING THE PERIOD UNDER CONSIDERATION. AL THOUGH, THE SAID CERTIFICATION WAS MADE AVAILABLE TO THE A.O. DURING REMAND PROCEEDING THE A.O. DID NOT TAKE IT INTO COGNIZANCE WHILE PREP ARING THE REMAND REPORT. ACCORDINGLY, NO CONCLUSIVE FINDING HAS BEEN GIVEN BY THE AO IN THE REMAND REPORT WITH RESPECT TO DESTINATION OF TH E TWO VOLVO BUSES. BY ADOPTING THE RATE OF RS. 10007- PER TRIP BASED U PON SIMILAR RATE OF TRAVEL OF KARNATAKA STATE ROAD TRANSPORT CORPORATIO N, THE AO HAS IMPLIED THAT ALL THE TRIPS ARE BETWEEN MUMBAI AND B ANGALORE NOTWITHSTANDING THE CERTIFICATE PRODUCED BY THE APP ELLANT AS MENTIONED ABOVE. FROM THE ASSESSMENT ORDER AND THE REPORT REC EIVED DURING REMAND PROCEEDINGS, I FIND THAT NO REASONING HAS BE EN GIVEN BY THE AO AS TO WHY ALL TRIPS SHOULD BE TREATED AS BETWEEN MU MBAI AND BANGALORE AND NOT MUMBAI AND HYDERABAD OR TO BOTH DESTINATION I.E., ON SOME DAYS TO BANGALORE AND ON FEW OTHER DAYS TO HYDERABA D. I FIND THAT THE AO HAS NOT EVEN BOTHERED TO EXAMINE NEETA TRAVELS W HEN THE MATTER WAS REMANDED BACK TO HIM. HE IS COMPLETELY SILENT O N THE CERTIFICATE PRODUCED BY THE APPELLANT. 11.3 THE ISSUE OF DETERMINATION OF DESTINATION CAN BE SEEN FROM ANOTHER ANGLE. IT IS AN UNDISPUTED FACT THAT THE DI STANCE BETWEEN MUMBAI TO HYDERABAD IS 707 KMS. AS SEEN FROM THE IN FORMATION AVAILABLE IN THE PUBLIC DOMAIN, THE TRAVEL TIME IS AROUND 13-14 HOURS FOR A LUXURIOUS BUS WITH ONE OR TWO HALTS OF 1 TO 2 HOU RS FOR PASSENGERS AND DRIVERS FOR FOOD AND REFRESHMENTS AND DEPENDING UPO N THE TRAFFIC SITUATION. THEREFORE, MORE THAN ONE TRIP IS NOT POS SIBLE IN A DAY BY BUS. SIMILARLY, THE DISTANCE BETWEEN MUMBAI TO BANGALORE IS AROUND 1000 KMS. IT TAKES AROUND 18-20 HOURS FOR A VOLVO BUS TO COVER THIS DISTANCE WITH AT LEAST 2 HALTS OF 1 HOUR EACH FOR REFRESHMEN TS. HENCE, ONE BUS CAN OPTIMALLY COVER 2 TRIPS (ONE GOING AND ONE RETU RNING) IN 3 DAYS. SO, FOR BANGALORE TRIP, IT WILL BE 0.67 TRIP PER DAY BY ONE VOLVO BUS. 11.4 NOW THE NEXT CONTROVERSY TO BE RESOLVED IS THE RATE OF ONE PASSENGER SEAT IN THE VOLVO BUS FOR HYDERABAD TRIP OR BANGALORE TRIP. THE APPELLANT HAS TAKEN THE RATE OF RS. 650/- PER T RIP PER PASSENGER FOR HYDERABAD TRIP. THE SAME IS SUBSTANTIATED BY THE CE RTIFICATE OF NEETA TRAVELS. THE RATE RELATES TO HYDERABAD JOURNEY, INI TIALLY, NO DOCUMENTARY EVIDENCE WAS SUBMITTED. LATER ON, DURIN G APPELLATE AND REMAND PROCEEDINGS, FEW BUS TICKETS ON SAMPLE BASIS OF DIFFERENT TRAVEL AGENCIES FOR THE YEAR 2010 ARE SUBMITTED TO DEMONST RATE THAT THE RATE PER SEAT IN A VOLVO BUS FOR HYDERABAD JOURNEY WAS B ETWEEN RS. 600 TO RS. 650. EVEN THE CERTIFICATE OF NEETA TRAVELS, AS MENTIONED IN THE PRECEDING PARAGRAPH SPECIFICALLY STATES THAT THE TI CKET PRICE WAS BETWEEN RS. 600-650 DEPENDING UPON THE SEASON. I DO NOT SEE ANY REASON FOR THE AO TO REJECT/OMIT TO CONSIDER THESE COMPARABLE RATES FOR HYDERABAD JOURNEY WHEN HE IS UNABLE TO BRING ON REC ORD HIGHER COMPARABLE RATE FOR HYDERABAD JOURNEY EXCEPT STATIN G THAT MORE NO. OF SAMPLE TICKETS SHOULD HAVE BEEN PRODUCED BY THE APP ELLANT OR BY RELYING UPON KARNATAKA STATE ROAD TRANSPORT CORPORA TION RATE OF RS. 1020/- FOR BANGALORE JOURNEY. IN MY CONSIDERED OPIN ION, EVEN THE RATE 7 2149/MUM/2018 ASST.YEAR: 2011-12 OF RS. 1000/- FOR BANGALORE JOURNEY DOES NOT PERTAI N TO THE YEAR 2010 SINCE AS STATED BY THE AO, THE SAME WAS EXTRACTED F ROM THE INTERNET DURING THE ASSESSMENT PROCEEDINGS CONCLUDED IN THE MONTH OF MARCH, 2014. IN THIS REGARD, I FIND THAT AT THE TIME OF PA SSING THIS ORDER IN JANUARY, 2018, INTERNET SHOWS RATE FOR A VOLVO BUS SEAT FOR MUMBAI- HYDERABAD JOURNEY AT RS. 800/-. THEREFORE, THE RATE IN THE F.Y. 2010-11 WOULD CERTAINLY BE LESS, IN MY CONSIDERED OPINION, THE AO SHOULD HAVE MADE NECESSARY LOCAL ENQUIRIES INCLUDING EXAMINING NEETA TRAVELS, AT THE REMAND STAGE, TO ASCERTAIN THE ACTUAL RATE FOR HYDERABAD/BANGALORE JOURNEY IN THE F.Y. 2010-11. IN THE ABSENCE OF ANY LOCAL ENQUIRY AND SUPPORTING EVIDENCES BROUGHT ON RECORD, THE AO'S AC TION IN APPLYING FLAT RATE FOR ALL JOURNEYS UNDERTAKEN BY TWO VOLVO BUSES AT RS. 1000/- CANNOT BE ACCEPTED ON TWO COUNTS. IT DOES NOT REPRE SENT THE ACTUAL RATE PREVAILING FOR BANGALORE JOURNEY IN F.Y. 2010-11. IT HAS NOT BEEN ESTABLISHED BY THE ASSESSING OFFICER THAT ALL THE J OURNEYS ARE UNDERTAKEN FOR BANGALORE AND NOT TO HYDERABAD. 11.5 THE NEXT QUESTION IS WHAT SHOULD BE THE AVERAG E RUN DAYS FOR THE BUSES DURING THE F.Y. 201 0-1 1 .THE AO HAS ASSUMED AVERAGE 250 RUN DAYS FOR EACH BUS IN THE RELEVANT YEAR. DURING APPE LLATE PROCEEDINGS, NO USE CERTIFICATES OF TWO BUSES ISSUED BY THE RTO, TH ANE ARE PRODUCED. THESE ARE EXAMINED BY THE AO IN THE REMAND PROCEEDI NGS. THE AO HAS STATED THAT BUS NO. 8090 WAS NOT IN USE FROM JANUAR Y, 2011 TO APRIL, 2011 I.E., FOR THREE MONTHS IN THE F.Y. 2010-11. SI MILARLY, BUS NO. 8081 WAS NOT IN USE FROM FEBRUARY, 2010 TO JUNE, 2010 I. E., THREE MONTHS IN THE RELEVANT YEAR. THUS, BOTH THE BUSES WERE AVAILA BLE FOR 270 DAYS IN F.Y. 2010-11. HENCE, 250 DAYS OF ACTUAL USE CANNOT BE RULED OUT IF 20 DAYS ARE KEPT FOR BREAKDOWN, REPAIRS ETC. IN THE RE JOINDER, THE LD. AR HAS ALSO NOT OBJECTED TO THIS 250 DAYS OF RUN FOR B OTH THE BUSES IN THE YEAR. 11.8 NOW COMING TO THE FINAL QUESTION OF CALCULATIO N OF FARE RECEIVED DURING THE YEAR FROM THE VEHICLES OWNED BY THE APPE LLANT. THE AO HAS CALCULATED THE COLLECTION OF TICKETS FROM THE AC VO LVO BUSES FOR 250 DAYS OF USE IN THE FOLLOWING MANNER: 45 SEATS X RS. 1 000 PER SEAT X 2 NO. OF BUS = RS. 90,000/-RS. 9000/- X 250 (NO. OF TRIPS) = RS. 2,25,00,000/- THEREAFTER, CONSIDERING THE JOURNEY UNDERTAKEN BY T WO NON-AC BUSES (FOR WHICH THERE IS NO DISPUTE), THE TOTAL RECEIPT OF BUS TICKET BOOKING INCOME OF THE APPELLANT DURING THE F.Y. 2010-11 HAS BEEN WORKED AT RS. 2,25,00,000/- + RS. 43,20,000/-( FOR TWO NONE AC BU SES) = RS. 2,68,20,000. ACCORDINGLY, THE DIFFERENCE IN THE TOT AL RECEIPT OF TICKET BOOKING INCOME AS COMPUTED BY THE AO ARRIVES AT RS. 75,48,413/-(RS. 2,68 , 20,000/--RS.1 1 92,71 , 587/-). 11.7 HOWEVER, THE ABOVE COMPUTATION HAS CERTAIN I NHERENT LACUNAS AS EXPLAINED IN PRECEDING PARAGRAPHS. BRIEFLY THESE AR E 8 2149/MUM/2018 ASST.YEAR: 2011-12 (I) IT HAS NOT BEEN ESTABLISHED BY THE AO THAT THE JOU RNEYS UNDERTAKEN BY BUSES ARE TO BANGALORE. HENCE, THE RA TE OF RS. 1000/- PER SEAT FOR VOLVO BUS FOR BANGALORE DESTINA TION CANNOT BE APPLIED FOR EACH DAY'S JOURNEY FOR BOTH T HE BUSES. (II) AS DISCUSSED IN PARA 11.3, ONE COMPLETED TRIP EVERY DAY BY A VOLVO BUS FROM BOMBAY TO BANGALORE OR VICE VERSA IS NOT POSSIBLE. THE MOST APPROPRIATE FACTOR FOR BANGALORE JOURNEY IS 0.67 COMPLETED JOURNEYS IN A DAY, EVEN IF WE CONSID ER THAT THE DESTINATION IS TO BANGALORE. FOR HYDERABAD JOUR NEY, THERE WILL BE ONE COMPLETED JOURNEY IN A DAY. 11.8 IN SUCH A SCENARIO, I AGREE WITH THE LD. AR TH AT EVEN IF IT IS ASSUMED THAT THE BUSES WERE OPERATED ON MUMBAI TO B ANGALORE ROUTE WITH THE RATE OF RS, 10007- AS ADOPTED BY THE AO, T HE RECEIPT FROM THE TWO VOLVO BUSES IN THE YEAR WILL BE 45 SEATS X RS. 1000 X 250 DAYS X 0.67 TRIPS PER DAY X 2 BUSES = RS. 1,50,75,0007-. FOR HYDERABAD JOURNEY, THE FIGURE WILL BE 45 SEATS X RS. 650 X 250 DAYS X 1 TRIPS PER DAY X 2 BUSES = RS.1,46,25,0007-. 11.9 IF THE UNDISPUTED RECEIPT OF RS. 43,20,0007- F OR TWO NONE AC BUSES IS ADDED TO THE AFORESAID RECEIPTS FROM TWO V OLVO BUSES, THE TOTAL WORKS OUT TO RS. 1,93,95,0007- FOR ALL BANGALORE JOURNEYS AND RS. 1,89,45,0007- FOR ALL HYDERABAD JOURNEYS. THE LATTE R IS THE AMOUNT TAKEN BY THE APPELLANT DURING ASSESSMENT PROCEEDING S. IT IS ALSO CLAIMED BY THE APPELLANT THAT THE BALANCE AMOUNT OF RS. 3,26,5877- ON THE RECEIPT SIDE OF THE P & L A/C RELATES TO RTO CO NSULTANCY BUSINESS INCOME. 11.10 SUMMARISING THE AFORESAID DISCUSSION, IN MY C ONSIDERED OPINION, SOME ADDITION IS DEFINITELY WARRANTED TO GAP CERTAI N UNCERTAINTIES/ LACUNAS LEFT IN THE OBSERVATIONS OF THE AO AND IN P RODUCING COMPLETE EVIDENCES BY THE APPELLANTS REGARDING ACTUAL NO OF DAYS THE JOURNEY HAVE BEEN UNDERTAKEN AND THE RECEIPTS RECEIVED FROM IT. LOOKING TO THE OVERALL FACTS AND CIRCUMSTANCES OF THE ISSUE INVOLV ED, AN ADDITION OF RS. 5,00,000 /- TO THE TOTAL RECEIPT OFFERED BY THE APPELLANT FROM BUS TRANSPORTATION BUSINESS IN THE P & L A/C IS SUFFICI ENT AND JUSTIFIED INSTEAD OF IMPUGNED ADDITION OF RS. 75,48,4137-. TH US THE APPELLANT GETS A RELIEF OF RS. 70,48,4137-. THUS, THE GROUND OF APPEAL NO. 2 IS PARTLY ALLOWED . 7. NOT SATISFIED WITH THE ORDER OF THE CIT(A), THE REVENUE IS IN APPEAL BEFORE US. 9 2149/MUM/2018 ASST.YEAR: 2011-12 8. AT THE TIME OF HEARING, LD D.R. APPEARING ON BEH ALF OF THE REVENUE SUPPORTED THE ORDER OF THE ASSESSING OFFICER WHEREA S THE LD A.R. SUPPORTED THE ORDER OF THE CIT(A). 9. HAVING HEARD BOTH THE SIDES, WE FIND THAT THE CI T(A) HAS ALLOWED PART RELIEF AFTER RECEIVING THE REMAND REPORT FROM THE A SSESSING OFFICER. WE FIND THAT NO MATERIAL HAS BEEN BROUGHT ON RECORD BY THE REVENUE TO ESTABLISH THE ACTUAL NUMBER OF DAYS OF JOURNEY UNDE RTAKEN BY THE BUSES OWNED BY THE ASSESSEE AND THAT RECEIPTS OUT OF THE JOURNEY. FURTHER, LD D.R. COULD NOT POINT OUT ANY SPECIFIC ERROR IN THE ORDER OF THE CIT(A). HENCE, WE CONFIRM THE ORDER OF THE CIT(A) AND DISMI SS THE GROUND OF APPEAL OF THE REVENUE. 10. GROUND NO.2 RELATES TO ADDITION OF RS.29,24,520 /- ON ACCOUNT OF CREDITS IN THE BANK ACCOUNTS OF THE ASSESSEE. 11. THE ASSESSING OFFICER FOUND THAT THE ASSESSEE H AD DEPOSITED CHEQUES OF RS.8,51,723/- IN THE BANK OF INDIA, MALA D EAST BRANCH AND RS.20,72,797/- IN KOTAK MAHINDRA BANK LTD., TOTALLI NG TO RS.29,24,520/-. THE ASSESSING OFFICER DID NOT ACCEPT THE CONTENTION OF THE ASSESSEE THAT THE CHEQUES WERE RECEIVED IN THE LINE OF BUSINESS A S AN RTO CONSULTANT AND COMMISSION AGENT AND THE BUSINESS RECEIPTS FROM SALE OF TICKETS ARE IN CASH THAT THE INCOME WAS DULY ACCOUNTED FOR AND ADDED THE SAME TO THE INCOME OF THE ASSESSEE. 12. ON APPEAL, IT WAS STATED BY THE ASSESSEE THAT D URING THE RELEVANT ASSESSMENT YEAR, THE ASSESSEE WAS ENGAGED AS AN RTO CONSULTANT LIKE GETTING PERMITS ISSUED FOR VEHICLES, GETTING VEHICL ES TRANSFERRED, PAYING 10 2149/MUM/2018 ASST.YEAR: 2011-12 OF ROAD TAXES, INSURANCE ETC FOR WHICH AN AMOUNT OF RS.3,26,587/- WAS OFFERED AGAINST THE TOTAL INCOME OF RS.29,24,520/-. 13. THE CIT(A) DELETED THE ADDITION MADE BY THE ASS ESSING OFFICER BY OBSERVING AS UNDER: 15.1 THE AO HAS MADE THE IMPUGNED ADDITION ON THE SINGLE PREMISE THAT IN THE SUBMISSION, THE APPELLANT HAS STATED THAT AL L BUSINESS RECEIPTS I.E., TICKET RECEIPTS FROM BUSES ARE IN CASH. HENCE, WHAT EVER CHEQUE DEPOSITS EXIST IN THE BANK ACCOUNTS, WILL AUTOMATICALLY REPRESENT THE APPELLANT'S UNACCOUNTED INCOME. ACCORDINGLY, ENTIRE CHEQUE DEP OSIT OF RS.29,24,520/- WAS ADDED TO THE TOTAL INCOME OF THE APPELLANT. IN MY OPINION, THE BASIS OF THIS PREMISE IS COMPLETELY WRONG AND UNACCEPTABLE. ONCE THE BANK ACCOUNTS ARE ACCOUNTED FOR AND THE RECEIPTS ARE CON SIDERED FOR THE TURNOVER OF THE BUSINESS OF THE APPELLANT, THERE IS NO REASO N FOR CONSIDERING THE CHEQUE AMOUNT AS UNACCOUNTED RECEIPTS. BEFORE THE A O, IT WAS EXPLAINED THAT THE RECEIPTS INCLUDE RTO'S CONSULTANT FEE LIKE GETTING PERMITS ISSUED FOR VEHICLES, GETTING VEHICLES TRANSFERRED, PAYING OF R OAD TAXES, INSURANCE ETC., THAT INCLUDED HIS CHARGES PLUS THE RTO CHARGES, TAX ES ETC FROM THE CUSTOMER. THE APPELLANT HAS ALSO PRODUCED BEFORE TH E AO THE COPIES OF RELEVANT LEDGER ACCOUNTS, FORM 26AS WHERE THE RECEI PTS AND TDS DEDUCTED ARE SHOWN. HOWEVER, THE AO HAS COMPLETELY DISREGARD ED THESE EVIDENCES BROUGHT BEFORE HIM DURING ASSESSMENT PROCEEDINGS. S INCE THE IMPUGNED AMOUNT WAS CREDITED IN CHEQUES, IT WAS EASY FOR THE AO TO ENQUIRE FROM THE PERSONS ISSUING THE CHEQUES AND TO TEST ITS GENUINE NESS BEFORE COMMENTING ON IT'S ACCOUNTABILITY. IN THIS REGARD, I AGREE WITH THE LD. AR THAT THE AO HAS NEITHER REJECTED THE BOOKS OF ACCOU NTS NOR BROUGHT ANY MATERIAL ON RECORD TO ESTABLISH THAT THE AMOUNT CRE DITED IN CHEQUES, IN THE BANKS, WAS UNACCOUNTED MONEY OF THE APPELLANT. EVEN DURING THE REMAND PROCEEDINGS, THE AO DID NOT CARRY OUT ANY VERIFICAT ION OR BROUGHT ANY ADVERSE MATERIAL TO PUT FORWARD HIS POINT. 14. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSE D THE RECORD OF THE CASE. WE FIND THAT THE OBSERVATION OF THE CIT( A) THAT O NCE THE BANK ACCOUNTS ARE ACCOUNTED FOR AND THE RECEIPTS ARE CON SIDERED FOR THE TURNOVER OF THE BUSINESS OF THE APPELLANT, THERE IS NO REASON FOR C ONSIDERING THE CHEQUE AMOUNT AS UNACCOUNTED RECEIPTS WAS NOT CONTROVERTED BY THE LD D.R. WE ALSO FIND THAT THE ASSESSEE HAS PRODUCED BEFORE THE ASSESSING OFFICER THE COPIES OF RELEVANT LEDGER ACCOUNTS, FORM 26AS WHERE THE RECEIPTS AND TDS DEDU CTED ARE SHOWN, WHICH 11 2149/MUM/2018 ASST.YEAR: 2011-12 EVIDENCES WERE COMPLETELY DISREGARDED BY THE ASSESS ING OFFICER. LD D.R. ALSO COULD NOT BRING ON RECORD THAT THE AMOUNT CREDITED IN CHEQUES IN BANKS WAS UNACCOUNTED MONEY OF THE ASESSEE. HENCE, WE DO NOT FIND ANY ERROR IN THE ORDER OF THE CIT(A), WHICH IS HEREBY CONFIRMED AND THE GR OUND OF APPEAL OF THE REVENUE IS REJECTED. 15. IN THE RESULT, APPEAL OF THE REVENUE IS DISMISS ED. PRONOUNCED ON 31/05/2019 SD/- SD/- (JUSTICE P.P.BHATT) PRESIDENT (G.S. PANNU) VICE PRESIDENT MUMBAI, DATE : 31/05/ 2019 B.K.PARIDA, SR. PS COPY TO : 1) THE APPELLANT: ITO, WARD 30(1(4), MUMBAI 2) THE RESPONDENT: SHRI HARSHAD A BARADIA, 5/6, DAD AMIYA CHAWL, QUARRY ROAD, OPP. LIPCO CO. MALAD (E), MUMBAI. 3) THE CIT(A) CONCERNED 4) THE CIT CONCERNED 5) THE D.R, F BENCH, MUMBAI 6) GUARD FILE BY ORDER DY./ASSTT. REGISTRAR I.T.A.T, MUMBAI