Shri Dipak H. Harvara (HUF), Jamnagar V. The ITO Ward-3 (2), Jamnagar

ITA 243/RJT/2019

• Counselvise Citation: [2024] 100 COUNSELVISE.COM (IT) 4244 (ITAT-RAJKOT)
• Duration Of Justice: 4 year(s) 2 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-01-2024
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 14-01-2024
• Assessment Year: 2012-2013
• Appeal Filed On: 22-10-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SHRIASHISHKUMARPANDEY
• Assessee Lawyers: SHRIMEHULRANPURA

Judgement Text

आयकरअपीलीयअधिकरण , राजकोटनयायपीी INTHEINCOMETAXAPPELLATETRIBUNAL, RAJKOTBENCH,RAJKOT (ConductedthroughVirtualCourt) BEFORESHRIWASEEMAHMED,ACCOUNTANTMEMBER And SHRITRSENTHILKUMAR,JUDICIALMEMBER आयकरअपीलसं ./ITANo.243/Rjt/2019 धििाधरणणवध / Asstt.Year:2012-2013 ShriDipakH.HarvaraHUF, HarvaraBrothers, AtDadia, Jamnagar. PAN:AAGHD8630M Vs.TheIncomeTaxOfficer, Ward-3(2), Jamnagar. (Applicant)(Respondent) Assesseeby:ShriMehulRanpura,A.R Revenueby:ShriAshishKumarPandey,Sr.DR सुिणाईकीतारीख /DateofHearing:15/01/2024 घोवणाकीतारीख /DateofPronouncement:19/01/2024 आदेश /ORDER PERWASEEMAHMED,ACCOUNTANTMEMBER: Thecaptionedappealhasbeenfiledattheinstanceoftheassesseeagainst theorderoftheLd.CommissionerofIncomeTax,(Appeals),Jamnagar,arisingin thematterofassessmentorderpassedunderSection143(3)oftheIncomeTax Act,1961(here-in-afterreferredtoas"theAct")relevanttotheAssessmentYear 2012-13. 2.ThefirstissueraisedbytheassesseeisthatLd.CIT(A),erredinconfirming theadditionofRs.9,77,990/-madebytheAOtreatingthecashdepositas unaccountedincomeoftheassessee. ITANo.243/Rjt/2019 A.Y.2012-13 2 3.ThefactsinbriefarethattheasseseeinthepresentcaseisHUFand engagedinthebusinessoftradinginagriculturalproductsinAPMCHapaYard. TheassesseewasmaintainingitsbankaccountinIndianOverseasBankwhich wascreditedforthesumaggregatingtoRs.44,85,500/-onlyintheformof cash/cheque/RTGSdeposits.Theassesseeoutofsuchcashdeposithasoffered thegrossreceiptofRs.19,18,630/-totaxundertheprovisionofsection44ADof theAct.Likewise,thesumofRs.14,50,000/-waspertainingtodifferentassessee namelyM/sCCSInvestment. 4.Theassesseefurtherreviseditsreturnofincomebyofferinggrossreceipt ofRs.9,77,990/-underthepresumptivetaxratebeing8%ofthegrossreceiptas specifiedu/s44ADoftheAct.Thus,theassesseeoutoftotaldepositofRs. 44,85,500/-inthebankaccounthasreconciledthesameasunder: GrossreceiptRs.44,85,500/- Sr.No.Amountin(Rs.) LessDeduction a.Grossreceiptshownin theincome-taxreturn 19,18,630/- b.Receiptpertainingto CCSInvestment 14,50,000/- c.Grossreceiptshownin therevisedreturnof income 9,77,990/- Total43,46,620/- 4.1However,theassesseehasnotofferedanyexplanationforthedifference amountofRs.1,38,880.00(Rs.44,85,500.00minus43,46,620/-)representingthe depositsinthebankaccount. 4.2However,theAOfoundthattheassesseehasrevisedreturnofincome beyondthestatutorytimepermittedu/s139(5)oftheAct,andthereforenocredit canbegiventotheincomeshownbytheassesseeintherevisedreturnofincome. ITANo.243/Rjt/2019 A.Y.2012-13 3 Thus,theAOmadetheadditionofRs.11,16,870/-{Rs.44,85,500.00minus (19,18,630/-plus14,50,000.00)}asundisclosedincomeoftheassessee. 5.TheaggrievedassesseepreferredanappealtotheLd.CIT(A).The assesseebeforetheLd.CIT(A)submittedthattheamountofcashdepositofRs. 9,77,990/-wasdepositedinthesamebankaccountwhichwasusedtoofferthe incomeonpresumptivebasisu/s44ADoftheAct.Accordingly,theincome disclosedintherevisedreturnofincomeshouldbemadesubjecttothetaxon presumptivebasiseventhoughtherevisedreturnwasfiledbelatedly.However,Ld. CIT(A)observedthatthebelatedreturnisnotmaintainablebyvirtueofthe provisionofsection139(5)oftheActandthereforetheincomeofferedtotaxin suchreturncannotbeaccepted.Assuch,theLd.CIT(A)confirmedtheadditionof Rs.11,16,870/-bysustainingtheassessmentorder. 6.BeingaggrievedbytheorderoftheLd.CIT(A),theasseseeisinappeal beforeus. 7.TheLd.ARbeforeusfiledapaperbookrunningfrompages1to32and contendedthattheamountofcashdepositinthebankwassubjecttotaxunder presumptivebasisevenintheearlierandthelateryearswhichwasalsoaccepted bytherevenue.Thus,accordinglytheLd.ARcontendedthatthedepositinthe bankaccountshouldbedeterminedunderthepresumptiverateoftaxasspecified undersection44ADoftheAct. 8.Ontheotherhand,Ld.DRvehementlysupportedtheorderofthe authoritiesbelow. 9.Wehaveheardtherivalcontentionsofboththepartiesandperusedthe materialsavailableonrecord.Admittedly,theassesseehasdisclosedincomewith respecttothedepositsinthebankaccountunderpresumptiverateoftaxu/s 44ADoftheAct.Undeniably,theassesseehasnotconsideredtheentiredeposits ITANo.243/Rjt/2019 A.Y.2012-13 4 oftheimpugnedbankaccountforthepurposeoftax.Assuch,therewasthe amountofdepositinthebankaccountforRs.9,77,990/-whichwasnot consideredbytheassesseeforofferingthetaxunderpresumptiverateoftax. NowthecontroversyariseswhethersuchamountofRs.9,77,990/-shouldbe madesubjecttotaxongrossbasisorunderpresumptiverateoftax.Inthis regard,wehaveperusedthebankstatementattachedalongwiththeassessment orderandcashbookavailableinthepaperbookandnotethattherearefrequent transactionofthelessvaluebothinthebankstatementaswellasinthecash bookandthereforewedrawinferencethattheentriesreflectedinthecashbook andbankaccountrepresentsthebusinessreceiptandthereforethesameshould bemadesubjecttotaxunderthepresumptiverateoftaxspecifiedu/s44ADof theAct.Hence,wesetasidethefindingsoftheLd.CIT(A)anddirecttheAOto computetheincomeonthecashdepositofRs.9,77,990.00underthe presumptiverateoftaxi.e.u/s44ADoftheAct.Hence,thegroundofappealof theassesseeispartlyallowed. 10.ThenextissueraisedbytheassesseeisthattheLd.CIT(A)inconfirming theorderofAObyholdingthattheassesseehasmadecashpaymentofRs. 5,00,245/-incontraventionoftheprovisionsofsection40A(3)oftheAct. 11.TheAOduringtheassessmentproceedingsfoundthattheassesseehas madecashpaymentexceedingthelimitofRs.20,000/-specifiedu/s40A(3)ofthe Act,againstthepurchasesmadefromthepartiesamountingtoRs.5,00,245/- whichisincontraventionoftheprovisionsofsection40A(3)oftheAct.Therefore, theAOdisallowedthesameandaddedtothetotalincomeoftheassessee.On appeal,theLd.CIT(A),waspleasedtoconfirmtheorderoftheAO. 12.BeingaggrievedbytheorderoftheLd.CIT(A),theassesseeisinappeal beforeus. ITANo.243/Rjt/2019 A.Y.2012-13 5 13.TheLd.ARbeforeussubmittedthatthepurchasesweremadeexceeding Rs.20,000/-butthepaymentwasmadeforRs.LessthanRs.20,000/-and thereforetheprovisionofsection40A(3)oftheAct,hasnotbeencontravened. Thus,nodisallowanceiswarranted. 14.Ontheotherhand,theLd.DRvehementlysupportedtheorderofthe authoritiesbelow. 15.Wehaveheardtherivalcontentionsofboththepartiesandperusedthe materialsavailableonrecord.Formakingdisallowanceu/s40A(3)oftheAct,the expenditureclaimedshouldbeoverandaboveRs.20,000/-.Inthepresentcase, thereisnodisputethattheassesseehasmadepurchasesfromtheparties exceedingRs.20,000/-.Buttheprovisionofsection40A(3)oftheActalsostates thatthepaymentagainstthepurchaseshouldalsobeinexcessofRs.20,000-ina day.However,onperusalofthecashbook,wenotethatinnoneofoccasion,the cashpaymenthasbeenmadebytheassesseeexceedingRs.20,000/-inaday. Therefore,weareoftheviewthatthereisnocontraventionoftheprovisionsof section40A(3)oftheAct,andaccordinglynodisallowanceiswarranted.Hence, wesetasidethefindingsoftheLd.CIT(A),withthedirectiontodeletethe additionmadebyhim.Hence,thegroundofappealoftheassesseeishereby allowed. 16.Intheresult,theappealfiledbytheassesseeisherebypartlyallowed. OrderpronouncedintheCourton19/01/2024atAhmedabad. Sd/-Sd/- (TRSENTHILKUMAR)(WASEEMAHMED) JUDICIALMEMBERACCOUNTANTMEMBER (TrueCopy) Ahmedabad;Dated19/01/2024 Manish,Sr.PSTRUECOPY