Income Tax Officer, Ward -4, Margao V. Shri Iqbal Ibrahim Narangi., Goa

ITA 217/PAN/2014

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 1214 (ITAT-PANAJI)
• Duration Of Justice: 2 year(s) 4 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-11-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 21-11-2016
• Assessment Year: 2010-2011
• Appeal Filed On: 26-06-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAVIRAJ Y V
• Assessee Lawyers: HIREMATH
• Section: 63

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PANAJI BENCH, PANAJI BEFORE SHRI GEORGE MATHAN, HONBLE JUDICIAL MEMBER & SHRI RAMIT KOCHAR HONBLE ACCOUNTANT MEMBER ITA NO. 217 /P A N/201 4 (ASST. YEAR : 20 1 0 - 1 1 ) ITO, WARD - 4, MARGAO GOA. VS. SHRI IQBAL IBRA HIM NARANGI, FLAT NO. G - 3, INDINHA APARTMENT, AQUEM, MARGAO, SALCETE, GOA. PAN NO. AFPPN 6839 L (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI M.R. HIREMATH ADV. DEPARTMENT BY : SHRI RA VIRAJ Y.V. - DR DATE OF HEARING : 2 1 / 11 /201 6 . DATE OF PRONOUNCEMENT : 21 / 11 /201 6 . O R D E R PER GEORGE MATHAN , JUDICIAL MEMBER THIS IS AN APPEAL FILED BY THE REVENUE AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS) , PANAJI IN APPEAL NO. 92/MRG/1314 , DATED 20 /0 3 /201 4 FOR THE ASSESSMENT YEAR 2010 - 11 . 2. SHRI RAVIRAJ Y.V., DEPARTMENTAL REPRESENTATIVE REPRESENTED ON BEHALF OF THE REVENUE AND SHRI M.R. HIREMATH, ADV OCATE REPRESENTED ON BEHALF OF THE ASSESSEE . 3 . IT WAS SUBMIT TED BY THE DEPARTMENTAL REPRESENTATIVE THAT THE ASSESSEE IS A FRUIT VENDOR. IT WAS THE SUBMISSION THAT HE HAD DISCLOSED HIS INCOME OF 1,50,000/ - IN RESPECT OF ONE BANK ACCOUNT BEARING NO.121010100143776 WITH AXIS BANK LTD., MARGAO WHEREIN THE TOTAL 2 ITA NO. 217/PAN/2014 CAS H DEPOSIT S WAS 47,12,518/ - . IT WAS THE SUBMISSION THAT ON ACCOUNT OF A I R I N F O R M A T I O N , IT WAS NOTICED THAT THE ASSESSEE W A S OPERATING TWO MORE B A N K ACCOUNTS BE A R I N G ACCOUNT NO. 121010100105132 HAVING TOTAL CASH DEPOSIT OF 38,43,663/ - AND ACCOUNT NO. 121010100155281 HAVIN G TOTAL CASH DEPOSIT OF 33,04,960/ - WITH AXIS BANK LTD., MARGAO . THE ASSESSING OFFICER , CONSEQUENTLY , HAD BROUGHT TO TAX THE TOTAL CASH DEPOSITS IN ALL THE THREE ACCOUNTS TREATING THE SAME AS UNEXPLAINED CASH DEPOSITS. IT WAS THE SUBMISSION THAT ON APPEA L, COMMISSIONER OF INCOME TAX (APPEALS) EXAMINED THE NATURE OF DEPOSITS AND WITHDRAWALS AND HAD COME TO THE CONCLUSION THAT THE SAME WAS USED FOR THE REGULAR BUSINESS OF THE ASSESSEE IN FRUIT S PURCHASES/SALES. SOME OF THE PAYMENTS HAVE BEEN MADE BY CH EQUES AND SOME OF THE PAYMENTS HAVE BEEN MADE I N CASH FOR THE PURCHASE OF THE FRUITS , AND THE SALE RECEIPTS HAVE BEEN DEPOSIT E D IN CASH IN THE BANK ACCOUNTS . CONSEQUENTLY, THE COMMISSIONER OF INCOME TAX (APPEALS) HAD APPLIED NET PROFIT RATE OF 10% ON ALL THE C ASH DEPOSITS AFTER EXAMINING THE SAME AS TRADING RECEIPTS. IT WAS THE SUBMISSION THAT THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS) WAS LIABLE TO BE REVERSED. 4 . IN REPLY, AUTHORIZED REPRESENTATIVE OF THE ASSESSEE INVOKED RULE 27 OF THE ITAT RULES, 1963 TO SUBMIT THAT NO CROSS OBJECTION HAS BEEN FILED BY THE ASSESSEE AS THE ASSESSEE WAS UNEDUCATED AND IGNOR A N T PERSON . IT WAS THE SUBMISSION THAT WHEN FILING HIS RETURNS, THE ASSESSEE HAD TAKEN INTO CONSIDERATION THE BANK ACCOUNT , W H I C H I S IN HIS NAME BEA RING ACCOUNT NO. 121010100143776. IT WAS THE SUBMISSION THAT THE BANK ACCOUNTS BEARING NUMBERS 121010 100105132 & 121010100155281 BEL ONGED TO THE ASSESSEES MOTHER. IT WAS THE SUBMISSION THAT THIS WAS ALSO BROUGHT TO THE ATTENTION OF THE COMMISSIONER OF INCOME TAX (APPEALS). IT WAS THE SUBMISSION THAT THESE TWO ACCOUNTS WERE ALSO UTILIZED BY THE ASSESSEE FOR HIS BUSINESS. IT WAS THE SUBMISSION THAT AS THE ASSESSEE HAD FILED H I S RETURN OF 3 ITA NO. 217/PAN/2014 INCOME , H E HAD O N L Y DISCLOSED THE INCOME IN RESPECT OF HIS BA NK ACCOUNT. THE INCOME IN RESPECT OF HIS MOTHERS ACCOUNT S HAD NOT BEEN DISCLOSED BY THE ASSESSEE. IT WAS THE SUBMISSION THAT THE COMMISSIONER OF INCOME TAX (APPEALS) HAD EXAMINED ALL THE THREE ACCOUNTS AND HAD ACCEPTED THE CONTENTION OF THE ASSESSEE THAT ALL THE THREE ACCOUNTS WERE USED FOR THE BUSINESS OF THE ASSESSEE AS A FRUIT VENDOR . IT WAS THE SUBMISSION THAT THE ESTIMATION OF THE ASSESSEES INCOME AT 10% BY THE COMMISSIONER OF INCOME TAX (APPEALS) WAS SUBSTANTIALLY ON HIGHER SIDE AND ALSO THAT THE COMMISSIONER OF INCOME TAX (APPEALS) HAD ERRED IN INCLUDING THE TURNOVER IN RESPECT OF THE BANK ACCOUNT B E A R I N G NO. 121010100143776 , IN RESPECT OF WHICH , THE ASSESSEE HAD FILED HIS RETURN DISCLOSING THE INCOME OF 1,50,000/ - . IT WAS THE PRAYER THAT THE TURNOVER IN RESPECT OF ESTIMATION OF INCOME MAY BE RESTRICTED TO THE TOTAL OF THE T W O BANK ACCOUNTS REPRESENTING NOS. 121010100105132 & 121010100155281 AND THE PROFIT BE ESTIMATED AT 5%. WHEN THIS WAS PUT TO THE AUTHORIZED REPRESENTATIVE OF THE ASS ESSEE, IT WAS SUBMITTED BY THE DEPARTMENTAL REPRESENTATIVE THAT WHEN COMPUTING THE TURNOVER, COMMISSIONER OF INCOME TAX (APPEALS) INCLUDED THE TURNOVER IN RESPECT OF T H E DISCLOSED BANK ACCOUNTS ALSO. IT WAS, HOWEVER THE SUBMISSION THAT AS THE EST I M ATION IS BEING DONE, THE TOTAL TURNOVER MUST BE CONSIDERED . HE VEHEMENTLY SUPPORTED THE ORDER OF THE ASSESSING OFFICER. 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. ADMITTEDLY, THE ASSESSEE S BANK ACCOUNT NO. 121010100143776 HAS ALREADY BEEN CONSIDERED WHEN CO MPUTING HIS INCOME AND FILING HIS RETURN. CONSEQUENTLY, THE TURNOVER IN RESPECT OF THE SAID BANK ACCOUNT CANNOT BE CONSIDERED AS UNDISCLOSED. THIS BEING SO, THE SUBMISSIONS OF THE AUTHORIZED REPRESENTATIVE OF THE ASSESSEE INVOKED THE LIBERTY A S PROVIDED UNDER RULE 27 OF THE ITAT RULES, 1963 STANDS ALLOWED AND CONSIDERING THE FACT THAT THE ASSESSEE HIMSELF IS A SMALL TIME FRUIT 4 ITA NO. 217/PAN/2014 VENDOR AND IN THE INTEREST O F N A T U R A L J U S T I C E , T H E O R D E R O F T H E COMMISSIONER OF INCOME TAX (APPEALS) S T A N D S M O D I F I E D . T H E NET PROFIT R A T E I S R E D U C E D F R O M 1 0 % T O 6 % C O N S I D E R I N G T H A T T H E ASSESSEE I S A R E T A I L E R O F F R U I T S A N D T H E T U R N O V E R I S R E S T R I C T E D T O T H E T W O B A N K A C C O U N T S B E A R I N G N O S . 121010100105132 & 121010100155281 T O T A L L I N G T O 7 1 , 4 8 , 6 2 3 / - . T H U S , A P P E A L O F T H E R E V E N U E S T A N D S D I S M I S S E D A N D T H E O R D E R O F T H E COMMISSIONER OF INCOME TAX (APPEALS) S T A N D S M O D I F I E D A C C E P T I N G T H E S U B M I S S I O N U N D E R R U L E 2 7 O F T H E ITAT R U L E S , 1 9 6 3 M A D E O N B E H A L F O F T H E ASSESSEE . 6 . I N T H E R E S U L T , A P P E A L O F T H E R E V E N U E S T A N D S D I S M I S S E D W I T H T H E D I R E C T I O N S A S G I V E N . ORDER PRONOUNCED IN THE COURT AT THE CLOSE OF T HE HEARING ON MONDAY , THE 2 1 TH DAY OF NOVEMBER , 201 6 AT GOA . ( RAMIT KOCHAR ) (GEORGE MATHAN) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 2 1 TH NOVEMBER , 201 6 . VR/ - COPY TO: 1 . THE ASSESSEE. SHRI IQBAL IBRA HIM NARANGI, FLAT NO. G - 3, INDINHA APARTMENT, AQUEM, MARGAO, SALCETE, GOA. 2 . THE REVENUE. ITO, WARD - 4, MARGAO GOA. 3 . THE CIT , P A N A J I G O A . 4 . THE CIT(A) , P A N A J I G O A . 5 . THE D.R . 6 . GUARD FILE. BY ORDER ASSISTANT REGISTRAR I.T.A.T., PANAJI