S.P. JAYAM, NAMAKKAL V. ITO, WARD - 2, NAMAKKAL

ITA 2226/CHNY/2019

• Counselvise Citation: [2021] 107 COUNSELVISE.COM (IT) 4286 (ITAT-CHENNAI)
• Duration Of Justice: 2 year(s) 2 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-09-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 05-05-2021
• Assessment Year: 2010-2011
• Appeal Filed On: 31-07-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: K VISHVA PADMANABHAN
• Keywords: Capital asset converted into stock in trade; Set aside
• Section: 147; 148

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH: CHENNAI , , $ BEFORE SHRI V. DURGA RAO, JUDICIAL MEMBER AND SHRI G. MANJUNATHA, ACCOUNTANT MEMBER ./ ITA NO.2226/CHNY/2019 /ASSESSMENT YEAR: 2010-11 SMT. S.P. JAYAM, 6A, SELLAPPAM PATTI POST, NAMAKKAL 637 019. [PAN: AIDPJ 4433F] VS. THE INCOME TAX OFFICER, WARD-2, NAMAKKAL. ( /APPELLANT) ( &'( /RESPONDENT) ( / APPELLANT BY : MR. K. VISHVA PADMANABHAN, C.A &'( /RESPONDENT BY : MR. SURESH PERIASAMY, JCIT /DATE OF HEARING : 19.07.2021 / DATE OF PRONOUNCEMENT : 30.09.2021 / O R D E R PER V. DURGA RAO, JUDICIAL MEMBER : THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAIN ST THE ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS), S ALEM IN I.T.A NO.159/2017-18 DATED 25.06.2019 RELEVANT TO THE ASS ESSMENT YEAR 2010-11. 2. THE BRIEF FACTS OF THE CASE ARE THAT THE A.O NO TICED FROM THE AIR INFORMATION THAT THE ASSESSEE HAS MADE CASH DEPOSIT S AMOUNTING TO RS. 11,75,265/- IN HIS SAVINGS BANK ACCOUNT MAINTAI NED WITH HDFC I.T.A NO.2226/CHNY/2019 :- 2 -: BANK, NAMAKKAL DURING THE FINANCIAL YEAR 2009-10 RE LEVANT TO THE ASSESSMENT YEAR 2010-11. THE ASSESSEE HAS NOT FILED ANY RETURN OF INCOME THEREFORE, THE A.O ISSUED A NOTICE U/S. 148 OF THE INCOME TAX ACT, 1961 (HEREINAFTER AS THE ACT) AND COMPLETED THE ASSESSMENT U/S. 143 R/W. S. 147 OF THE ACT. THE A.O HAS CONSIDERED THE ENTIRE STATEMENT OF THE SAVING BANK ACCOUNT AND HE HAS OBSERVED THAT THE SOURCE OF CASH DEPOSITS AMOUNTING TO RS.8,33,755/- NOT EXPLAI NED BY THE ASSESSEE. IN VIEW OF THESE, THE SUM OF RS.8,33,755/ - BEING UNEXPLAINED, UNPROVEN CASH DEPOSITS IS ASSESSED AS INCOME AND ADDED TO THE INCOME RETURNED. THE A.O FURTHER NOTED THAT THE ASSESSEE HAS DEPOSITED AN AMOUNT OF RS. 3,82,477/-. NO EXPLA NATION HAS GIVEN AND THE SAME HAS BEEN CONSTRUED AS SHORTFALL SUPPRE SSION OF THE COMMISSION AND ADDED TO THE TOTAL INCOME OF THE ASS ESSEE. 3. ON APPEAL THE LD. CIT(A) CALLED THE REMAND REPOR T FROM THE A.O AND OBSERVED THAT THE A.O HAS CONTENDED THAT THE AS SESSEE HAS FAILED TO PRODUCE ANY DOCUMENTARY EVIDENCE SUCH AS NAME AN D ADDRESS OF THE PARTIES TO WHOM THE RAW-MATERIAL WAS SOLD, THE DATE OF SALE, QUANTUM VALUE OF RAW-MATERIAL SOLD, TO SUBSTANTIATE THAT THE AMOUNT RECEIVED BY WAY OF CHEQUE BY THE ASSESSEE WAS PAID OUT OF THE SALE OF POULTRY RAW-MATERIALS. THE A.O THEREFORE CONCLUDED THAT THE ASSESSEE COULD NOT SUBSTANTIATE THE SOURCE TOWARDS CLAIM OF CASH DEPOSIT OF RS. I.T.A NO.2226/CHNY/2019 :- 3 -: 8,33,755/- AND THEREFORE, THE UNPROVEN CASH DEPOSIT OF RS. 8,33,755/- IS TO BE TREATED AS AN UNDISCLOSED INCOME. THE ASSESSE E HAS NOT FILED ANY OBJECTIONS IN RESPECT OF THE REMAND REPORT GIVE N BY THE ASSESSEE. ACCORDINGLY, ADDITION WAS CONFIRMED. SO FAR AS THE ADDITION IN RESPECT OF RS. 3,82,477/-, THE LD. CIT(A) HAS NOTED THAT TH E ASSESSEE HAS FAILED TO PROVE ANY EVIDENCE TO SUPPORT HER CLAIM BOTH DUR ING THE ASSESSMENT PROCEEDINGS AS WELL AS REMAND PROCEEDINGS THEREFORE , THIS ADDITION ALSO CONFIRMED. 4. ON APPEAL BEFORE US, THE LD. COUNSEL FOR THE AS SESSEE HAS POINTED OUT FROM THE PAPER BOOK AT PAGE NO.2 THAT T HE ASSESSEE HAS RECEIVED CASH AND PAYMENT ALSO MADE TO VIJETH PROTE INS. THE TOTAL AMOUNT RECEIVED BY THE ASSESSEE IS AT RS.6,49,275/- AND SUBMITTED THAT THE SAME MAY BE VERIFIED BY THE A.O. HE FURTHE R SUBMITTED THAT SO FAR AS OTHER ADDITION IS CONCERNED ON 07.01.2010 TH E ASSESSEE HAS RECEIVED A CHEQUE FROM KALIYANNAN POULTRY FARM. ON 09.01.2010 PAYMENT OF RS.3,20,046/- MADE TO M/S. MAHAVIR BANSI LAL JAIN VIDE CHEQUE NO.345237 AND ON 12.01.2010 PAYMENT OF RS. 2 6,396/- MADE TO M/S. NARESH BROTHERS VIDE CHEQUE NO.345238 RESPE CTIVELY AND SUBMITTED THAT THE ISSUE MAY BE REMITTED BACK TO TH E A.O TO EXAMINE RECEIPTS AND PAYMENTS MADE BY THE ASSESSEE. I.T.A NO.2226/CHNY/2019 :- 4 -: 5. ON THE OTHER HAND, THE LD. DEPARTMENTAL REPRESEN TATIVE DID NOT RAISE ANY SERIOUS OBJECTION. 6. WE HAVE HEARD BOTH THE SIDES, PERUSED THE MATER IALS AVAILABLE ON RECORD AND GONE THROUGH THE ORDERS OF THE AUTHOR ITIES BELOW. THE CASE OF THE A.O IS THAT THE ASSESSEE HAS FAILED TO EXPLAIN CASH DEPOSITS MADE IN THE BANK ACCOUNT AND THEREFORE, HE ADDED TH E ENTIRE DEPOSITS MADE BY THE ASSESSEE TO THE INCOME OF THE ASSESSEE. THE CASE OF THE ASSESSEE IS THAT THE ASSESSEE IS IN THE POULTRY RAW MATERIAL BUSINESS AND WHATEVER THE AMOUNT RECEIVED FROM THE CUSTOMERS DEPOSITED IN THE BANK ACCOUNT. SUBSEQUENTLY, THE SA ME IS PAID TO THE VARIOUS PARTIES FROM WHOM HE HAS BROUGHT THE RAW MA TERIAL. SO FAR AS THE ADDITION IN RESPECT OF RS. 3,20,046/- IS CONCER NED, HE SUBMITTED THAT THE PAYMENT IS RECEIVED THROUGH CHEQUE AND PAYMENT IS ALSO MADE BY CHEQUE AND SUBMITTED THAT THESE DETAILS ARE AVAILAB LE IN THE PAPER BOOK PAGE-2 AND SUBMITTED THAT THE ISSUE MAY BE REMITTED BACK TO THE A.O TO EXAMINE THE ENTIRE ISSUE DENOVO . WE HAVE GONE THROUGH THE PAPER BOOK PAGE-2 FILED BY THE ASSESSEE AND WE ARE OF THE OPINION THAT PAGE- 2 OF THE PAPER BOOK IS A MATERIAL DOCUMENT IT NEEDS TO BE VERIFIED AND HAS TO BE CONSIDERED BY THE A.O. THIS MATERIAL DOC UMENT WAS NOT BEFORE THE A.O AT THE TIME OF PASSING THE ASSESSMEN T ORDER THEREFORE, IN THE INTEREST OF JUSTICE, WE SET ASIDE THE ORDER PASSED BY THE LD. I.T.A NO.2226/CHNY/2019 :- 5 -: CIT(A) AND REMIT THE MATTER BACK TO THE A.O AND DIR ECT THE A.O TO ADJUDICATE THE ISSUE DENOVO IN ACCORDANCE WITH LAW BY CONSIDERING PAGE-2 OF PAPER BOOK FILED BY THE ASSESSEE. ACCORD INGLY, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED FOR STATISTICAL PU RPOSE. 7. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED ON 30 TH SEPTEMBER, 2021 IN CHENNAI. SD/- SD/- ( ) (G. MANJUNATHA) /ACCOUNTANT MEMBER ( ) (V. DURGA RAO) /JUDICIAL MEMBER /CHENNAI, /DATED: 30 TH SEPTEMBER, 2021 . EDN/- /COPY TO: 1. /APPELLANT 2. /RESPONDENT 3. ( )/CIT(A) 4. /CIT 5. /DR 6. /GF