NALLASAMY GOUNDER RAMESH KUMAR, ERODE V. DCIT, CENTRAL CIRCLE-3(4), CHENNAI

ITA 250/CHNY/2023

AI Insights

The case involves Shri Nallasamy Gounder Ramesh Kumar, a resident individual engaged in trading/brokering in oils, who appealed against the addition of Rs.7 Lacs to his income for the assessment year 2013-14. The addition was initially made following a search operation under section 132 of the Income Tax Act, which revealed unaccounted cash payments. The assessee argued that the payments were made to hedge-off US dollars and were adjusted against undisclosed transactions of oil. The Tribunal considered similar assessments in earlier years and allowed the telescoping of additional commission income against the unexplained investment.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 134127 (ITAT-CHENNAI)
• Duration Of Justice: 2 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-05-2023
• Appeal Filed By: Assessee
• Order Result: PartlyAllowed
• Bench Allotted: A
• Next Hearing Date: 16-05-2023
• Assessment Year: misc
• Appeal Filed On: 23-02-2023
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: VISHVA PADMANABHAN LD
• Section: 132; 153C

Judgement Text

आयकर अपीलीय अिधकरण “ए” ायपीठ चे ई म । IN THE INCOME TAX APPELLATE TRIBUNAL “A” BENCH, CHENNAI माननीय ी वी.द ु गा राव, ाियक सद! एवं माननीय ी मनोज कु मार अ%वाल ,लेखा सद! के सम(। BEFORE HON’BLE SHRI V. DURGA RAO, JM AND HON’BLE SHRI MANOJ KUMAR AGGARWAL, AM आयकरअपील सं./ ITA No.250/Chny/2023 (िनधा रण वष / As sessment Years: 2013-14) Shri Nallasamy Gounder Ramesh Kumar No.158, Veerabhadra Street, Hotel Oxford Backside, Erode-638 003. बनाम/ V s . DCIT, Central Circle-3(4) Chennai. था यी ले खा सं . / जी आ इ आ र सं . / P A N / G I R N o . A FMP R- 9442 -L (अ पीलाथ /Appellant) : (!"थ / Respondent) अपीलाथ कीओरसे/ Appellant by : Shri Vishva Padmanabhan (CA)- Ld.AR !"थ कीओरसे/Respondent by : Shri R.Mohan Reddy (CIT) – Ld.Sr .DR सुनवाईकीतारीख/Date of Hearing : 17-05-2023 घोषणाकीतारीख /Date of Pronouncement : 17-05-2023 आदेश / O R D E R Manoj Kumar Aggarwal (Accountant Member): 1. The sole grievance of the assessee in the captioned appeal is confirmation of addition of Rs.7 Lacs. The Ld. AR made arguments and sought telescoping of the income. The Ld. CIT-DR has opposed the same. The assessee being resident individual is stated to be engaged in trading / brokering in oils under proprietorship concern namely M/s Asthalakshmi Agencies. The concern acted as an agent of M/s Kallesuwari Refinery Private Ltd. (KRPL) for Erode district. M/s KRPL as well as the assessee was subjected to search u/s 132 on 17.05.2017 2 ITA No.250/Chny/2023 and an assessment was framed against the assessee u/s 153C r.w.s. 143(3) of the Act on 30.12.2019 in which addition of Rs.47 Lacs was made. 2. During the course of search, certain incriminating document was found which indicated unaccounted cash payment of Rs.47 Lacs by M/s Asthalakshmi Agencies to one Shri Nagaraj of M/s KRPL. The payment was stated to be made out of unaccounted stock of crude oil. However, post search proceedings, the assessee submitted that the amount was paid to hedge-off US dollars. Since the transaction could not materialize, the same was adjusted against undisclosed transaction of oil. It was also submitted that the payment was made out of undisclosed income of financial year 2012-13. Considering the same, Ld. AO added an amount of Rs.46.53 Lacs as unexplained investment after adjusting the commission income of Rs.0.47 Lacs as offered by the assessee in the return of income. 3. The Ld. CIT(A), considering the cash flow statement, rendered a finding that the assessee had maximum cash availability of Rs.40 Lacs on 18.05.2012 and therefore, the source to that extent could be accepted. The balance amount of Rs.7 Lacs was confirmed against which the assessee is in further appeal before us. 4. We find that a similar assessment has been framed in assessee’s case for earlier AYs 2011-12 & 2012-13. In AY 2011-12, the assessee has disclosed additional commission income of Rs.0.99 Lacs. In AY 2012-13, Ld. AO has made another addition of commission income of Rs.3.29 Lacs. In our opinion, the telescoping benefit of these two items 3 ITA No.250/Chny/2023 could be granted to the assessee. We order so. The Ld. AO is directed to recompute the income of the assessee. 5. The appeal stands partly allowed. Order pronounced on 17 th May, 2023. Sd/- Sd/- (V. DURGA RAO) (MANOJ KUMAR AGGARWAL) ाियक सद!/JUDICIAL MEMBER लेखा सद! / ACCOUNTANT MEMBER चे6ई Chennai; िदनांक Dated : 17-05-2023 DS आदेश की Qितिलिप अ%ेिषत / Copy of the Order forwarded to : 1. अपीलाथ /Appellant 2. यथ /Respondent 3. आयकर आय ु त/CIT 4. वभागीय त न ध/DR 5. गाड फाईल/GF