Abdul Rajak A. Sheikh, Rajkot V. Income Tax Officer, Ward-2(1) (2), Rajkot

ITA 215/RJT/2017

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 6283 (ITAT-RAJKOT)
• Duration Of Justice: 2 year(s) 7 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-01-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: RJT
• Assessment Year: 2008-2009
• Appeal Filed On: 23-06-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ANIL KR DAS
• Keywords: Business income; Additional evidence; Reasonable cause; Corroborative evidences
• Section: 44AD; 143(3); 68; 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL RAJKOT BENCH , RAJKOT BEFORE: SHRI MAHAVIR PRASAD , JUDICIAL MEMBER AND S H RI AMARJIT SINGH , ACCOUNTANT MEMBER [CONDUCTED THROUGH E - COURT AT AHMEDABAD] SH. ABD UL RAZAK A. SHEIKH, 302 - VRAJVATIKA, BOGHANI STREET (PETA GALI), SONI BAZAR, RAJKOT PAN: BBKPS2333E (APPELLANT) VS THE ITO, WAR D - 2(1)(2), RAJKOT (RESPONDENT) REVENUE BY : S H RI ANIL KR. DAS , SR. D . R. ASSESSEE BY: S H RI SUMIT SHINGALA , A.R. DATE OF HEARING : 2 1 - 01 - 2 020 DATE OF PRON OUNCEMENT : 28 - 01 - 2 020 / ORDER P ER : AMARJIT SINGH, ACCOUNTANT MEMBER : - THI S ASSESSEE S APPEAL FOR A.Y. 2008 - 09 , AR ISES FROM ORDER OF THE CIT(A) - 2, RAJKOT DATED 31 - 03 - 2017 , I N PROCEEDINGS UNDER SECTION 143(3) R.W.S. 147 OF THE INCOME TAX ACT, 1961; IN SHORT THE ACT . I T A NO . 215 / RJT /20 17 A SSESSMENT YEAR 200 8 - 09 I.T.A NO. 215 /RJT /20 17 A.Y. 2008 - 09 PAGE NO . SH. ABDUL RAJAK A. SHEIKH VS. ITO 2 2. THE SOLITARY GROUND OF THE APPEAL IS AGAINST THE ACTION OF LD. CIT(A) IN CONFIRMING T H E ADDITION MADE BY THE ASSESSING OFFICER OF PETTY CASH DESPO SI T MADE IN THE BANK TOTALING TO RS. 39 , 37 , 301/ - . 3. THE FACT IN BRIEF IS THAT ASSESSING OFFICER WAS HAVING INFORMATION THAT ASSESSEE HAD DEPOSITED CASH OF RS. 39 , 37 , 30 1/ - IN AXIS BANK D URING THE FINANCIAL YEAR UNDER CONSIDERATION. THEREFORE, A NOTICE U/S. 148 OF T HE WAS ISSUED ON 30 TH MAY, 2015 . IN RESPONSE, THE ASSESSEE HAD FURNISHED RETURN OF INCOME DECLAR ING TOTAL INCOME OF RS . 92 , 650/ - U/S. 44AD AND IT WAS ALSO STATED THAT ASSESSEE WAS NOT MAINTAINING ANY BOOKS O F ACCOUNT. DURING THE C OUR S E OF ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER HAS ISSUED SHOW CAUSE NOTICE TO THE ASSESSEE TO EXPLAIN THE TRANSA CTION O F DEPOSIT CASH/CREDIT OF RS. 39 , 37 ,301/ - IN THE BANK ACCOUNT MAINTAINED WITH AXIS BANK RAJKOT DURING THE PERIOD OF 01 - 04 - 2007 TO 31 ST MARCH, 2008 AND WITHDRAWAL OF THE AMOUNT BY ATM FROM OUTSIDE ROJKOT. I N RESPONSE TO THE SHOW CAUSE NOTICE ISSUED B Y THE ASSESSING OFFICER, THE ASSESSEE HAS NEITHER ATTENDED NOR FILED ANY SUBMISSION. CONSEQUENTLY , THE ASSESSING OFFICER HAS HELD THAT ASSESSEE FAILED TO SUBSTANTIATE THE CREDITWORTHINESS, IDENTITY AND CAPACITY OF T HE DEPOSITORS, THEREFORE, THE AMOUNT O F RS. 39 , 37 , 301/ - WAS ADDED TO THE TOTAL INCOME OF THE ASSESSEE U/S. 68 OF THE ACT. 4. THE ASSESSEE HAS FILED APPEAL BEFORE THE LD. CIT(A). DURING THE COUR S E OF APPELLATE PROCEEDINGS BEFORE THE LD. CIT(A), THE ASSESSEE SUBMITTED THAT ASSESSING OFFICER HAS N OT CONSIDERED THE ASSESSEE S SUBMISSION THAT ASSESSEE WAS DOING BUSINESS OF TRADING IMITATION JEWELRY DUR ING THE YEAR UNDER CONSIDERATION AND DE POSI T AND WITHDRAWAL FROM THE BANK ACCOUNT WERE I.T.A NO. 215 /RJT /20 17 A.Y. 2008 - 09 PAGE NO . SH. ABDUL RAJAK A. SHEIKH VS. ITO 3 PERTAINED TO HIS BUSINESS. THE ASSESSEE HAS ALSO SUBMITTED BEFORE THE LD. CIT(A) THAT ASSESSING OFFICER HAS NOT BROUGHT ANY MATERIA L ON RECORD WHICH SUBSTANTIATE THAT THE ENTIRE DEPOSIT WERE H IS INCOME. THE ASSESSE E HAS ALSO SUBMITTED THAT ASSESSING OFFICER HAS FAILED TO CONSIDER THAT CASH DEPOSIT WAS GENERATE D FROM THE SA L E PROCEED AND WITHDRAWAL S WERE MADE FOR PURCHASE OF GOODS. THE LD. CIT(A) HAD DISMISSED THE APPEAL OF THE ASESSEE HOLDING THAT DURING ASSESSMENT PROCEEDINGS NO EXPLANATION OF C AS H DEPOSITING WAS FURNISHED EXCEPT STATING THAT RETURN OF INCOM E WAS FILED U/S. 44AD IN SPITE OF SPECIFIC SHOW CAUSE NOTICE ISSUED BY T H E ASSESSING OFFICER. T HE REFORE, THE LD. CIT(A) HAS NOT ADMITTED THE ADDITIONAL EVIDENCES UNDER RULE 46A OF THE I.T. RULE. 5. DURING THE COURSE OF APPELLATE PROCEEDINGS BEFORE US, THE LD. COUNSEL HAS FILED PAPER BOOK COMPRISING DETAIL OF SUBMISSION MADE BEFORE ASSESSING OFFICER AND LD. CIT(A) DURING THE COURSE OF ASSESSMENT PROCEEDINGS AND APPELLATE PROCEEDINGS. THE LD. CO U NSE L HAS SUBMITTED THAT ASSESSEE WAS E N G A GED IN THE BUSINE SS OF IM ITATION JEWELRY AND THE CASH DEP O SI T REPRESENT S THE BUSINESS RECEIPT OF THE ASSESSEE AND ALL THE DEPOSITS WERE OUT OF THE TRADING RECEIPT . IT IS CONTENDED THAT THE LD. CIT(A) HAS NOT CONSIDERED THE SUBMISSION OF THE ASSESSEE ON MERIT . ON THE OTH ER HAND LD. DEPARTMENTAL REPRESENTATIVE SUPPORTED THE ORDER OF LD. CIT(A). 6 . WE HAVE HEARD BOTH THE SIDES AND PERUSED THE MATERIAL ON RECORD. THE ASSESSING OFFICER HAS MADE ASSESSMENT U/S . 143(3) R.W.S. 147 OF THE ACT AFTER MAKING ADDITION OF RS. 39 , 37 ,301 / - ON ACCOUNT OF NOT PROVING THE GENUINENESS OF CASH DEPOSIT OF RS. 39 , 37 ,301 / - IN TO THE BANK ACCOUNT OF THE I.T.A NO. 215 /RJT /20 17 A.Y. 2008 - 09 PAGE NO . SH. ABDUL RAJAK A. SHEIKH VS. ITO 4 ASSESSEE. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER HAS ISSUED SHOW CAUSE NOTICE DATED 24 TH FEB, 2016 ASK ING THE ASSE SSEE TO ESTABLISH THE IDENTITY AND CAPACITY OF THE DEPOSITOR AND GENUINESS OF THE TRANSACTION. H OWEVER , THE ASSESSEE HAS NOT MADE ANY COMPLIANCE TO THE SHOW CAUSE NOTICE ISSUED BY T H E ASSESSING OFFICER. BEFORE LD. CIT(A) , THE ASSESSEE HAS MADE SUBMISSION ALONG WITH SUPPORTING EVIDENCE CLAIMING THAT ASSESSEE WAS ENGAG ED IN THE B U SINESS OF IMITATION JEWELRY AND THE CASH DEPOSIT AND WITHDRAWAL M A DE FROM T H E BANK ACCOUNT W E RE PERTAINED TO HIS BUSINESS TRANSACTION. THE LD. CIT(A) HAS NOT ADMITTED THE ADDITION AL EVIDENCES STATING THAT THE SAME WERE NOT FURNISHED BEFORE THE ASSESSING OFFICER. IT IS CLEAR FROM THE FACTS AND CIRCUMSTANCES THAT THE CASE OF THE ASSESSEE WAS NOT ADJUDICATED ON MERIT AS THE ASSESSEE HAS FAILED TO MAKE COMPLIANCE TO THE SHOW CAUSE NO TICE ISSUED BY THE ASSESSING OFFICER DURING THE COURSE OF ASSESSMENT PROCEEDINGS . I T IS ALSO NOTICED THAT SHOW CAUSE NOTICE WAS ISSUED ON 24 TH FEB, 2016 DIRECTING THE ASSESSEE TO FURNISH INFORMATION OR BEFORE 29 TH F EB, 2016 AND ASSESSMENT WAS COMPLETED IM MEDIATELY ON THE FOLLOWING DATE ON 1 ST MARCH, 2015 . APART FROM ABOVE, WE OBSERVE THAT ASSESSEE HAS FAILED TO CITE REASONABLE CAUSE FOR NOT MAKING COMPLIANCE BEFORE THE ASSESSING OFFICER. WHEN THESE FACTS WERE CONFRONTED TO THE LD. COUNSEL DURING THE COUR SE OF APPELLATE PROCEEDINGS BEFORE US, HE PLEADED TO CONSIDER HIS REQUEST OF DEPOS IT ING RS. 10,000/ - AS A COST FOR WASTING PRECIOUS TIME OF THE LOWER AUTHORITIES FOR NOT MAKING P ROPER COMPLIANCE IN ORDER TO PROVIDE HIM ANOTHER OPPORTUNITY TO DECIDE THE ISS UE ON MERIT BY THE LOWER AUTHORITIES. IN THE LIGH T OF THE ABOVE FACTS AND CIRCUMSTANCES, WE ARE OF THE VIEW THAT IT WILL BE APPROPRIATE TO RESTORE THIS CASE TO THE FILE OF ASSESSING OFFICER FOR DECIDING AFRESH AFTER EXAMINATION AND I.T.A NO. 215 /RJT /20 17 A.Y. 2008 - 09 PAGE NO . SH. ABDUL RAJAK A. SHEIKH VS. ITO 5 VERIFICATION OF THE DET AIL AND INFORMATION FILED BY THE ASSESSEE O N PRODUCTION OF COPY OF CHALLAN OF DEPOSITING THE COST AS CITED ABOVE WITHIN ONE MOTH OF RECEIPT OF THIS ORDER BY THE ASSESSEE. 7 . IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PR ONOUNCED IN THE OPEN C OUR T ON 28 - 01 - 20 20 SD/ - SD/ - (MAHAVIR PRASAD ) ( AMARJIT SINGH ) JUDICIAL MEMBER ACCOUNTANT MEMBER AHMEDABAD : DATED 28 /01/2020 / COPY OF ORDER FORWARDED TO: - 1. ASSESSEE 2. REVENUE 3. CONCERNED CIT 4. CIT (A) 5. DR, ITAT, AHMEDABAD 6. GUARD FILE. BY ORDER, ASSISTANT REGISTRAR, INCOME TAX APPELLATE TRIBUNAL, RAJKOT