Mr.Sunil Kumar Lakhotia , Hospet V. The Assistant Commissioner of Income Tax Circle-1 , Bellary

ITA 2176/BANG/2018

• Counselvise Citation: [2020] 110 COUNSELVISE.COM (IT) 9289 (ITAT-BANGALORE)
• Duration Of Justice: 2 year(s) 1 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-08-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 13-08-2020
• Assessment Year: 2013-2014
• Appeal Filed On: 12-07-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: N O N E
• Assessee Lawyers: BALIRAM R RAO
• Keywords: Unexplained cash credit; Set aside
• Section: 201; 68

Judgement Text

ITA NO.2176/BANG/2018 MR. SUNIL KUMAR LAKHOTIA, HOSPET IN THE INCOME TAX APPELLATE TRIBUNAL ABENCH: BANGALORE BEFORE SHRI B. R. BASKARAN, ACCOUNTANT MEMBER AND SHRI PAVAN KUMAR GADALE, JUDICIAL MEMBER ITA NO.2176/BANG/2018 ASSESSMENT YEAR: 2013-14 MR. SUNIL KUMAR LAKHOTIA PROP: M/S. BALAJI CARRIERS, M/S. GAURAV TRADE LINKS 1 ST FLOOR, CNG COMPLEX R.K. PHOTO STUDIO, COLLEGE ROAD HOSPET-583 201 PAN NO : ABBPL6946Q VS. THE ACIT CIRCLE-1 BELLARY APPELLANT RESPONDENT A PPELLANT BY : SHRI BALIRAM R.RAO, A.R. RESPONDENT BY : N O N E DATE OF HEARING : 13.08.2020 DATE OF PRONOUNCEMENT : 14.08.2020 O R D E R PER B.R. BASKARAN, ACCOUNTANT MEMBER: THE APPEAL FILED BY THE ASSESSEE DIRECTED AGAINST T HE ORDER DATED 30.3.2018 PASSED BY LD. CIT(A) GULBARGA AND IT RELA TES TO ASSESSMENT YEAR 2013-14. 2. NONE APPEARED ON BEHALF OF THE REVENUE. WE HEAR D LD. A.R. AND PERUSED THE RECORD. ITA NO.2176/BANG/2018 MR. SUNIL KUMAR LAKHOTIA, HOSPET PAGE 2 OF 4 3. THE ISSUE CONTESTED IN THIS APPEAL IS WITH REGAR D TO THE ADDITION OF RS.18.14 LAKHS MADE BY THE A.O. U/S 68 OF THE ACT WHICH WAS CONFIRMED BY LD. CIT(A). 4. THE FACTS RELATING TO THE ISSUE ARE THAT THE ASS ESSEE IS A BUSINESSMAN CARRYING ON TWO BUSINESSES. 1) GAURAV TRADE LINES - TRADING OF LIMESTONE 2) SHRI BALAJI CARRIERS - TRANSPORT BUSINESS BESIDES THE ABOVE, THE ASSESSEE IS ALSO RECEIVING R EMUNERATION FROM M/S. SRC CHEMICALS PVT. LTD, DIVIDEND FROM SHARES A ND INTEREST INCOME FROM BANK. THE ASSESSEE CLAIMS TO HAVE MAINT AINED SEPARATE BOOKS OF ACCOUNT FOR THESE RECEIPTS ALSO, I.E., THE ASSESSEE HAS MAINTAINED THREE SEPARATE BOOKS OF ACCOUNTS FOR ALL THE 3 ACTIVITIES REFERRED ABOVE, I.E., TWO BUSINESS CONCE RNS AND ONE PERSONAL BOOKS. IT IS STATED THAT THE RETURN OF IN COME WAS FILED BY CONSOLIDATING THE FINANCIAL STATEMENTS AS A WHOLE. 5. THE A.O. NOTICED THAT THE ASSESSEE HAS INTRODUCE D ADDITIONAL CAPITAL OF RS.91.75 LAKHS DURING THE YEAR UNDER CON SIDERATION. ACCORDINGLY, HE ASKED THE ASSESSEE TO EXPLAIN THE S OURCES FOR RS.91.75 LAKHS. THE ASSESSEE EXPLAINED THAT HE USE D TO TRANSFER FUNDS FROM PERSONAL BOOKS TO BUSINESS BOOKS AND ALS O FROM ONE BUSINESS TO ANOTHER BUSINESS. IN THE BOOKS FROM WH ICH PAYMENT IS MADE, IT WILL BE SHOWN AS INVESTMENT AND IN THE BOO KS OF BUSINESS CONCERN, WHICH RECEIVES MONEY, IT WILL BE SHOWN AS ADDITIONAL CAPITAL. ACCORDINGLY, IT WAS SUBMITTED THAT THE AD DITIONAL CAPITAL, IN FACT, REPRESENTS INTER-BOOK TRANSFERS ONLY. IT WAS SUBMITTED THAT THE TOTAL SOURCE AVAILABLE WITH THE ASSESSEE IN PERSONA L BOOKS IS RS.1,32,33,979/- OUT OF WHICH RS.91,75,000/- WAS TR ANSFERRED TO OTHER BUSINESS CONCERNS. HOWEVER, THE A.O. TOOK A FIGURE OF RS.79.60 LAKHS AS THE AMOUNT DRAWN BY THE ASSESSEE AND DEDUCTED ITA NO.2176/BANG/2018 MR. SUNIL KUMAR LAKHOTIA, HOSPET PAGE 3 OF 4 A SUM OF RS.6 LAKHS FROM IT AND ACCORDINGLY ACCEPTE D SOURCES TO THE TUNE OF RS.73.60 LAKHS. ACCORDINGLY, HE TREATED TH E REMAINING AMOUNT OF RS.18.17 LAKHS AS UNEXPLAINED CASH CREDIT AND ASSESSED THE SAME. THE LD. CIT(A) ALSO CONFIRMED THE SAME. AT THE TIME OF HEARING, THE LD A.R EXPRESSED HIS INABILITY TO EXPL AIN AS TO HOW THE AO TOOK THE FIGURE OF RS.79.60 LAKHS AS SOURCES. 6. THE LD. A.R. SUBMITTED THAT THE ASSESSEE HAS NOT INTRODUCED ANY FRESH CAPITAL AND ALL THE FUNDS HAVE BEEN TRANS FERRED FROM ONE CONCERN TO ANOTHER CONCERN. HE SUBMITTED THAT THE ASSESSEE WOULD BE IN A POSITION TO EXPLAIN THE SAME TO THE SATISFA CTION OF THE A.O., IF AN OPPORTUNITY IS GIVEN TO THE ASSESSEE. 7. WE FIND MERIT IN THE PRAYER OF LD. A.R. ACCORDI NGLY, WE SET ASIDE THE ORDER PASSED BY THE LD. CIT(A) AND RESTOR E THIS ISSUE TO THE FILE OF THE A.O. FOR EXAMINING IT AFRESH. THE ASSESSEE IS ALSO DIRECTED TO FURNISH THE RECONCILIATION STATEMENT, I NFORMATION AND EXPLANATIONS TO THE SATISFACTION OF THE A.O. AND CO OPERATE WITH HIM FOR EXPEDITIOUS COMPLETION OF THE ASSESSMENT. AFTE R AFFORDING ADEQUATE OPPORTUNITY TO THE ASSESSEE, THE A.O. MAY TAKE APPROPRIATE DECISION IN ACCORDANCE WITH LAW. 8. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS TRE ATED AS ALLOWED FOR STATISTICAL PURPOSES, ORDER PRONOUNCED IN THE OPEN COURT ON 14-08-2 02 0 SD/- (PAVAN KUMAR GADALE) JUDICIAL MEMBER SD/- (B.R. BASKARAN) ACCOUNTANT MEMBER BANGALORE, DATED 14 TH AUG, 2020. VG/SPS ITA NO.2176/BANG/2018 MR. SUNIL KUMAR LAKHOTIA, HOSPET PAGE 4 OF 4 COPY TO: 1. THE APPLICANT 2. THE RESPONDENT 3. THE CIT 4. THE CIT(A) 5. THE DR, ITAT, BANGALORE. 6. GUARD FILE BY ORDER ASST. REGISTRAR, ITAT, BANGALORE.