Nehal Ravjibhai Patel, Ahmedabad V. The Income Tax Officer, Ward-3(3), Ahmedabad

ITA 2410/AHD/2014

• Counselvise Citation: [2018] 118 COUNSELVISE.COM (IT) 9885 (ITAT-AHMEDABAD)
• Duration Of Justice: 4 year(s) 3 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-12-2018
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 19-06-2017
• Assessment Year: 2009-2010
• Appeal Filed On: 28-08-2014
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Section: 143(3)

Judgement Text

, B - IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCH B BEFORE SHRI RAJPAL YADAV, JUDICIAL MEMBER AND SHRI AMARJIT SINGH, ACCOUNTANT MEMBER ./ IT NO.2410/AHD/2014 / ASSTT. YEARS: 2009-10 NEHALRAVJIBHAI PATEL, MEHTA LODHA& CO. CHARTERED ACCOUNTANTS 105, SAKAR-I, ASHRAM ROAD, AHMEDABAD 380 009 PAN: ABIPP9151G VS. ITO, WARD-3(3), AHMEDABAD / (APPELLANT) / (RESPONDENT) ASSESSEE BY : PRAKASH D SHAH, A.R REVENUE BY : MUDITNAGPAL, SR. DR ! / DATE OF HEARING : 26/10/2018 '#$ ! / DATE OF PRONOUNCEMENT: 10 /12/2018 %& / O R D E R PER RAJPAL YADAV, JUDICIAL MEMBER: THE ASSESSEE IS IN APPEAL BEFORE THE TRIBUNAL AGAI NST THE ORDER OF LEARNED COMMISSIONER OF INCOME TAX-6, AHMEDABAD (CIT(A)) DA TED 25/06/2014 PASSED FOR A.Y. 2009-10. THE SOLITARY GRIEVANCES OF THE ASSESSEE IS THAT LEARNED CIT(A) HAS ERRED IN CONFIRMING THE ADDITION OF RS. 12,03,700/- WHICH WA S ADDED BY THE ASSESSING OFFICER WITH THE AID OF SECTION 68/69 OF THE INCOME TAX ACT. 2. THE BRIEF FACTS OF THE CASE ARE THAT ASSESSEE HA S FILED HIS RETURN OF INCOME ON 31 ST MARCH, 2010 DECLARING TOTAL INCOME OF RS. 1,37,199/ -. THE CASE OF THE ASSESSEE WAS SELECTED FOR SCRUTINY ASSESSMENT AND A NOTICE U/S 143(2) OF THE INCOME TAX ACT, 1961 WAS ISSUED AND SERVED UPON THE ASSESSEE. THE LEARNED AO GOT INFORM ATION FROM ANNUAL INFORMATION REPORT WING SHOWING THAT ASSESSEE HAD DEPOSITED A SUM OF R S. 12,03,700/- INTO SAVING BANK IT NO. 2410/AHD/2014A.YR. 2009-10 2 ACCOUNT WITH BANK OF BARODA, KHADIA BRANCH. THE LD. AO DIRECTED THE ASSESSEE TO SHOW A SOURCE OF SUCH DEPOSITS. ACCORDING TO THE AO, ASSES SEE FAILED TO GIVE ANY SOURCE, HENCE, HE MADE THE ADDITION OF RS. 12,03,700/-. 3. DISSATISFIED WITH THE ADDITION, ASSESSEE CARRIED THE MATTER BEFORE THE CIT(A). LD. FIRST APPELLATE AUTHORITY CONCURRED WITH THE AO AND CONFI RMED THE ADDITION. THE FINDINGS OF THE LEARNEDCIT(A) READ AS UNDER: 1. ADDITION OF CASH DEPOSITS IN THE BANK [12,03, 700]: 3.1 AS SEEN FROM THE ASSESSMENT ORDER, WRITTEN SUBM ISSION FILED BY THE APPELLANT, REMAND REPORT FURNISHED BY THE A.O. AND RE-JOINDER TO THE REMAND REPORT FILED BY THE APPELLANT, THE FACTS OF THE MATTER ARE ASFO LLOWS. APPELLANT IS ENGAGED IN THE BUSINESS OF TRADING COMPUTER ANDPARTS. AS PE R AIR INFORMATION APPELLANT WAS FOUND TO HAVE DEPOSITED RS. 12,03,700 7- IN HIS SAVINGS BANK ACCOUNT WITH BANK OF BARODA. DURING THE COURSE OF A SSESSMENT PROCEEDINGS, APPELLANTCONTENDED THAT THE SAID DEPOSITS ON VARIOU S DATES WERE MADE OUT OFSALE PROCEEDS OF GOLD. HOWEVER, HE COULD NOT FUR NISH ANY EVIDENCE INTHEREOF. DURING THE COURSE OF APPELLATE PROCEEDIN GS HE FURNISHEDTHE SALE BILL IN SUPPORT OF THE CONTENTION THAT THE GOLD WA SSOLD TO ONE SINGLE PARTY NAMELY M/S BHAVIN JEWELERS. 3.2 HAVING CONSIDERED THE ENTIRE MATERIAL ON RECORD , I AM INCLINED TO THE ADDITION. APPELLANT IS NOT ENGAGED IN TRADING OF GO LD. HE DID NOT MAINTAIN ANY STOCK REGISTER IN THIS REGARD. HE FAILED TO PRODUC E BUYER OF GOLD DURING THE REMAND PROCEEDINGS, STATING THAT M/S BHAVINJEWELER CLOSED THE BUSINESS 2 TO 3 YEARS BEFORE. THE SALE BILL WAS NOTPRODUCED DURIN G THE COURSE OF ASSESSMENT PROCEEDINGS. THERE IS NOCORRELATION BETWEEN THE DA TES OF SALE OF GOLD AND THE CASH DEPOSITSMADE IN THE BANK ACCOUNT. HE COULD PRO DUCE THE EVIDENCE IN SUPPORTOF PURCHASING THE GOLD THROUGH HIS CREDIT CA RD, BUT THERE IS NO EVIDENCETHE SAID GOLD WAS SOLD. THE ENTIRE SALE PRO CEEDINGS WERE RECEIVEDIN CASH. IN THE LIGHT OF THESE FACTS I AM OF THE VIEW THAT THE APPELLANTFAILED TO ESTABLISH THE SOURCE OF THE CASH DEPOSITS MADE IN T HE BANKACCOUNT. THEREFORE, IMPUGNED ADDITION OF RS. 12,03,700/- IS UPHELD. 4. BEFORE US LEARNEDCOUNSEL FOR THE ASSESSEE HAS GI VEN A NEW DIMENSION TO THE LITIGATION HE FILED WRITTEN SUBMISSION WE DEEMED IT APPROPRIAT E TO TAKE A NOTE OF SUBMISSION WHICH READ AS UNDER: BEFORE THE HON'BLE INCOME TAX APPELLATE TRIBUNAL, BENCH -B. AHMEDABAD IT NO. 2410/AHD/2014A.YR. 2009-10 3 NAME OF THE ASSESSEE NEHALRAVJIBHAIPATEL ITANO. 2410/AHD/2014 ASST.YEAR 2009-10 SECTION AND SUB-SECTION UNDER WHICH THE ORDER APPEALED AGAINST WAS PASSED 143(3) NEXT DATE OF HEARING 25 OCTOBER 2018 WRITTEN SUBMISSION WITH REFERENCE TO THE ABOVE APPEAL OF THE ASSESSEE FOR THE ASSTT YEAR 2009-10, THE ASSESSEE RESPECTFULLY SUBMITS THE FOLLOWING FOR YOUR KIND PE RUSAL :- GROUND NO.L- ADDITION OF RS. 12,03,7007- OF CASH DE POSIT IN SAVING BANK ACCOUNT WITH BANK OF BARODA-KHADIA BRANCH AS UNEXPLAINED INCOME 1. THE APPELLANT SUBMISSION IN THIS REGARD BEFORE THE LEARNED CIT(A) IS TO BE CONSIDERED . 2. IN VIEW OF THE FOLLOWING, IT CANNOT BE SAID THAT TH E APPELLANT HAS NOT DISCLOSED THE ACCOUNT TO DEPARTMENT AS FOR THE OPEN ING OF THE SAID SAVING BANK ACCOUNT PAN NUMBER HAS BEEN FURNISHED TO THE B ANK AND FURTHER VIDE LETTER DATED 16/11/2011 IT WAS INFORMED TO THE LD.AO THAT CREDIT ENTRIES IN THE SAID ACCOUNTS RELATES TO GOLD SALES IN CASH AND IT WAS ALSO STATED THAT THERE IS NO GOLD SALES BILLS .(REFER PA RA 4 OF THE ASSESSMENT ORDER). THE GOLD PURCHASE BILLS IN PURSUANCE TO THE GOLD SA LE BY THE APPELLANT, WERE PRODUCED BEFORE THE ID. CIT(A) BUT SINCE THE PURCHASER M/S. BHAVINJ EWELLARS HAS CLOSED THE BUSINESS, NOTICE UNDER SECTION 133{6) OF THE ACT COULD NOT BE SERVED UPON HIM AND HE COULD NOT PRODUCED FOR THE VERIFICATION. 3. IN VIEW OF THE FOLLOWING FACTS IT CANNOT BE SAID TH AT THE TRANSACTIONS IN THE SAID BANK ACCOUNT CANNOT BE OF BUSINESS :- (I) DURING THE YEAR UNDER CONSIDERATION, THE APPELLANT HAD DONE ADDITIONAL BUSINESS ACTIVITY RELATED TO THE GOLD TR ADING AND ON ACCOUNT OF ASSESSEE'S PERSONAL REASONS INCLUDING LO SS IN THE SAID BUSINESS, IT HAS NOT DISCLOSED IN THE RETURN OF INC OME. (II) THE SAID GOLD HAS BEEN PURCHASED THROUGH CREDIT CAR D AND ITS BILLS AND CONFIRMATION HAVE BEEN FURNISHED TO THE D EPARTMENT. (III) FURTHER, NOWHERE I HAVE DENIED MY SAID BANK ACCOUNT AND I HAVE OWNED UP SAID BANK ACCOUNT TRANSACTIONS AS MY BUSIN ESS TRANSACTIONS AND FURTHER THERE IS NO STATEMENT OR EVIDENCES WITH THE DEPARTMENT THAT I HAVE NOT MADE SUCH BUSINESS TRANSACTIONS (IV) AS THE SALES CONSIDERATION IS ON VARIOUS DATES, TH E RECEIPTS MADE FROM THE SAID BUSINESS HAVE BEEN DEPOSITED IN TO TH E BANK ON VARIOUS DATES AND IT IS NOT SINGLE DEPOSIT AND WHICH ALSO S UGGEST THAT THERE IS BUSINESS. IT NO. 2410/AHD/2014A.YR. 2009-10 4 (V) THE AFORESAID FACTS WERE ALSO EXPLAINED TO THE LEAR NED AO DURING THE PERSONAL HEARING BUT THE LEARNED AO WAS INSISTING O N PRODUCTION OF EVIDENCES IN SUPPORT OF CASH DEPOSITED IN THE BANK ACCOUNT BUT ON ACCOUNT OF NON MAINTENANCE OF REGULAR BOOKS OF ACCO UNTS AND OTHER REASONS STATED IN ABOVE PARAS, THE SAID EVIDENCES C OULD NOT BE FURNISHED AT THE TIME OF ASSESSMENT PROCEEDINGS. 4. WITHOUT PREJUDICE TO ABOVE SUBMISSION, IN VIEW OF T HE JUDGMENT OF THE HON'BLE APEX COURT IN THE CASE OF CIT VS P K NOORJAH (237 ITR 570)(SC), THEORY OF HUMAN PROBABILITY IS TO BE APPLIED AND REASONABLE ESTIMAT E OF INCOME SHOULD BE MADE AND THEREFORE SUCH HUGE AMOUNT CANNOT BE ASSESSED AS UN EXPLAINED INVESTMENT U/S. OF THE ACT. 5. IT IS ALSO SUBMITTED THAT A PAYMENTS WERE MADE FOR ANY PERSONAL WITHDRAWALS OUT OF THE SAID BANK OR FOR THE ACQUISITION OF ANY PR OPERTY OR ASSET AND THERE IS SUCH FINDING OF THE REVENUE ALSO. 6. IN VIEW OF THE ABOVE FACTS AND LEGAL POSITION, THE ADDITION OF RS. 13,03,700/- MADE U/S. OF THE ACT IS BAD IN LAW AND THEREFORE THE LEA RNED AO BE DIRECTED TO DELETE THE SAID ADDITIONS MADE U/S. OF THE ACT. YOUR HONOR IS REQUESTED TO CONSIDER THE ABOVE WHILE PASSING THE ORDER AND OBLIGE. 5. ON THE OTHER HAND, LEARNED DR RELIED UPON THE OR DER OF THE AO. 6. WE HAVE DULY CONSIDERED THE RIVAL CONTENTIONS AN D GONE THROUGH THE RECORD CAREFULLY. THERE IS NO DISPUTE WITH REGARD TO THE F ACT THAT ASSESSEE WAS HAVING A SAVING BANK ACCOUNT, IN THIS ACCOUNT, DURING THE ACCOUNTIN G PERIOD RELEVANT TO ASSESSMENT YEAR 2009-10, A SUM OF RS.12,03,700/- WAS DEPOSITED IN C ASH.THE ASSESSEE WAS REQUIRED TOEXPLAIN THE SOURCE OF SUCH CASH. THE ASSESSEE CON TEND THAT HE HAS STARTED A NEW LINE OF BUSINESS IN TRADING OF GOLD. HE HAS PURCHASED T HE GOLD THROUGH CREDIT CARD AND THEREAFTER SOLD THAT. WE DO NOT FIND FORCE IN THIS CONTENTION OF THE ASSESSEE. THE COPY OF THE BANK STATEMENT AS WELL AS DETAILS OF ALLEGED CASH RECEIPT ON SALE OF GOLD HAS BEEN PLACED ON THE RECORD. A PERUSAL OF THE BANK STATEME NT WOULD INDICATE THAT SMALL AMOUNTS HAVE BEEN DEPOSITED BY CASH,WHICH CANNOT BE TERMED AS THE SAME VALUE PERTAINING TO GOLD SALES. THERE IS NO OTHER EVIDENC E IN SUPPORT OF SUCH CONTENTION HAS BEEN FILED BEFORE US, RATHER THIS SPECIFIC PLEA WAS NOT TAKEN BEFORE THE AO. THEREFORE, WE ARE OF THE VIEW THAT THE ASSESSEE FAILED TO DEMO NSTRATE THE SOURCE OF CASH DEPOSITED IT NO. 2410/AHD/2014A.YR. 2009-10 5 IN THE SAVING BANK ACCOUNT. ACCORDINGLY, WE DO NOT FIND ANY MERIT IN THIS GROUND OF APPEAL, IT IS REJECTED. 7. IN THE RESULT, APPEAL OF THE ASSESSEE IS DISMISS ED. [ORDER PRONOUNCED IN THE COURT ON 10 TH DECEMBER, 2018.] SD/- SD/- (AMARJIT SINGH) ACCOUNTANT MEMBER (RAJPAL YADAV) JUDICIAL MEMBER AHMEDABAD; DATED 10/12/2018 TRUE COPY %& '()*%)$ / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. + / THE RESPONDENT. 3. ,, - / CONCERNED CIT 4. - ( ) / THE CIT(A) 5. )./'' , / DR, ITAT, 6. /012 / GUARD FILE. %& / BY ORDER, 3 / ,4 (DY./ASSTT.REGISTRAR) , / ITAT, AHMEDABAD