M/s Lachman Dass Sanjay Kumar, Ladwa V. ITO, Kurukshetra

ITA 254/CHANDI/2011

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 5347 (ITAT-CHANDIGARH)
• Duration Of Justice: 3 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-06-2011
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: SMC
• Next Hearing Date: 16-05-2011
• Assessment Year: 2007-2008
• Appeal Filed On: 11-03-2011
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: N K SAINI
• Assessee Lawyers: S K MUKHI
• Keywords: Income from undisclosed sources
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL CHANDIGARH BENCH SMC, CHANDIGARH BEFORE MS.SUSHMA CHOWLA, JUDICIAL MEMBER ITA NO.254 /CHD/2011 (ASSESSMENT YEAR : 2007-08) LACHMAN DASS SANJAY KUMAR, VS. THE INCOME-TAX OFF ICER, SHOP NO.62, NEW GRAIN MARKET, WARD 2, LADWA. KURUKSHETRA. PAN: AAAFL4825G (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI S.K.MUKHI RESPONDENT BY : SHRI N.K.SAINI, DR O R D E R PER SUSHMA CHOWLA, J.M, : THE APPEAL OF THE ASSESSEE IS AGAINST THE ORDER OF THE COMMISSIONER OF INCOME-TAX (A), DATED 24.12.2010 RELATING TO ASS ESSMENT YEAR 2007-08 AGAINST THE ORDER PASSED U/S 143(3) OF THE INCOME-T AX ACT. 2. THE EFFECTIVE GROUND OF APPEAL RAISED BY THE ASS ESSEE IS AS UNDER 3. THAT WITHOUT PREJUDICE TO THE ABOVE GROUNDS OF APPEAL THE APPELLANT DISPUTES THE QUANTUM OF ADDITION I.E. RS.1,80,000/- AS CONFIRMED BY THE APPELLATE AUTHORITY AS HIGHLY EXCESSIVE. 3. THE ISSUE ARISING IN THE PRESENT APPEAL IS AGAIN ST THE ADDITION OF RS.1,80,000/-. 2 4. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSE E IS ENGAGED IN THE TRADING OF FOOD GRAINS AND IS ALSO EARNING COMMISSI ON ON SALE OF FOOD GRAINS. DURING THE COURSE OF ASSESSMENT PROCEEDI NGS, ON EXAMINATION OF THE BANK ACCOUNT OF THE ASSESSEE WITH PUNJAB NAT IONAL BANK, THE ASSESSING OFFICER NOTED AS UNDER : I) THAT THE ASSESSEE SHOWN WITHDRAWAL OF RS.1,00,0 00/- FROM BANK ON 5.12.2006 WHEREAS THE SAME WAS WITHDRAWN ON 7.12 .2006; II) THAT RS.80,000/- WAS SHOWN TO BE WITHDRAWN ON 7.12. 2006 WHEREAS THE SAME WAS WITHDRAWN FROM THE BANK ON 8.1 2.2006; III) A SUM OF RS.35,000/- WAS SHOWN TO BE WITHDRAWN AS O N 16.02.2007 WHEREAS THE SAME WAS WITHDRAWN ON 15.02. 2007. 5. THE EXPLANATION OF THE ASSESSEE WAS THAT IN THE MONTH OF DECEMBER, BECAUSE OF MULTI ACTIVITIES, ROKER REMAIN ED PENDING FOR 2 TO 3 DAYS AND HENCE THE ENTRIES WERE MADE ON DIFFERENT D ATES THAN THE DATE OF WITHDRAWAL FROM THE BANK. THE ASSESSING OFFICER NO TED THE ASSESSEE TO HAVE INTRODUCED CASH IN THE BOOKS OF ACCOUNT WITHOU T WITHDRAWING THE SAME FROM THE BANK AND ACCORDINGLY AN ADDITION OF R S.2,15,000/- WAS MADE AS INCOME FROM UNDISCLOSED SOURCES. THE CIT(A ) ON THE PERUSAL OF THE DOCUMENTS SUBMITTED BY THE LEARNED A.R. FOR THE ASSESSEE NOTED THE ASSESSEE TO HAVE BEEN MAINTAINING DAILY CASH BOOK I .E. ROJNAMACHA IN WHICH ALL CASH ENTRIES WERE ENTERED ON DAY-TO-DAY B ASIS, CASH BOOK (ROKER/NAKAL BAHI) IN WHICH ENTRIES WERE MADE FROM THE ROJNAMACHA AND ALL THE JOURNAL ENTRIES OF PURCHASE/SALE. THE PHO TOSTAT COPIES OF THE SAID BOOKS WERE EXAMINED AND THE CIT(A) OBSERVED THAT TH E ASSESSEE HAD MADE PAYMENTS ON THE APPOINTED DAYS AND TO COVER UP THE SAME CASH WITHDRAWN ON LATER DAYS WAS ENTERED ON PREVIOUS DAT ES. 6. THE ASSESSEE IS IN APPEAL AGAINST THE AFORESAID ORDER OF THE CIT(A). 3 7. THE LEARNED A.R. FOR THE ASSESSEE DREW MY ATTENT ION TO THE COPIES OF THE ROJNAMACHA AND CASH BOOK PLACED AT PAGES 20 TO 26 OF THE PAPER BOOK AND STRESSED THAT THE AMOUNTS WERE ENTERED IN THE ROJNAMACHA ON THE DATE OF THE CHEQUE AND NOT ON THE DATE OF ENCAS HMENT BY BANK. 8. THE LEARNED D.R. FOR THE REVENUE POINTED OUT THA T ON THE DATE WHEN THE AMOUNTS WERE STATED TO HAVE BEEN INTRODUCED, CO RRESPONDING DEBITS WERE ALSO MADE FOR WHICH THE ASSESSEE HAS NO EXPLAN ATION. THE LEARNED D.R. FOR THE REVENUE DREW MY ATTENTION TO THE CLOSI NG BALANCE ON THE RESPECTIVE DATES AND POINTED OUT THAT THE ORDER OF THE CIT(A) MERITS TO BE UPHELD IN THIS CASE. 9. I HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED T HE RECORD. THE ASSESSEE HAD INTRODUCED CASH IN ITS BOOKS OF ACCOUN T I.E. ROJNAMACHA ON THE DATE/S PRIOR TO THE AMOUNT BEING WITHDRAWN FROM THE BANK. A SUM OF RS.1 LAC WAS INTRODUCED ON 5.12.2006. THE AMOUNT W AS WITHDRAWN FROM THE BANK ON 7.1.2006. SIMILARLY, A SUM OF RS.80,00 0/- WAS INTRODUCED ON 7.12.2006, BUT WAS WITHDRAWN FROM BANK ON 8.12.2006 . A COPY OF ROJNAMACHA PLACED AT PAGE 20 OF THE PAPER BOOK REVE ALS THAT AS ON 5.12.2006 THE OPENING CASH IN THE HAND WAS RS.9926. 40 AFTER INTRODUCTION OF RS.1 LAC IN CASH, THE BALANCE CASH IN HAND WAS RS.38,340.65 AND ON THE NEXT DATE I.E. 6.12.2006 T HE CLOSING BALANCE OF CASH WAS 2340.65. ON 7.12.2006, THERE WAS AN INTRO DUCTION OF RS.80,000/- AND THE CLOSING CASH IN HAND WAS RS.39, 345.65, WHICH STOOD REDUCED TO RS.22,345.65 ON 8.12.2006. HOWEVER, IN THE CASH BOOK THE ASSESSEE HAS NEITHER REFLECTED THE INTRODUCTION OF CASH, NOR THE ENTRIES OF EXPENDITURE/DEBIT ON THE SAID DATES AS IS EVIDENT F ROM THE COPY OF CASH 4 BOOK PLACED AT PAGES 24 TO 26 OF THE PAPER BOOK. T HE CIT(A) OBSERVED AS UNDER : 2.3 THERE WAS OPENING CASH IN HAND OF RS.9,926.50 ON 5.12.2006 IN THE CASH BOOK/ROJNAMACHA. THE ONLY ENT RY WAS OF EXPENSES OF RS.305/- AND AFTER REDUCING THE SAME, T HE CLOSING BALANCE OF RS.9,621.50 WAS TAKEN FORWARD. THERE WAS NO TRAN SACTION ON 6.12.06. THE OPENING BALANCE ON 7.12.06 WAS AS SUCH RS.9,621.50. THE WITHDRAWAL OF RS.1 LAKH FROM BANK WAS TAKEN ON 7.12.06 AND AFTER CONSIDERING VARIOUS PAYMENTS, THE CLOSING BAL ANCE SHOWN WAS RS.6,345.65 AS ON 7.12.06. THE POSITION IN THE PAKK I ROKAR/NAKAL BAHI IS, HOWEVER, DIFFERENT. THE WITHDRAWAL OF RS.1 LAKH FROM THE BANK HAS BEEN TAKEN ON 5.12.06 AND THE ENTIRE PAYMENTS C LAIMED TO BE MADE ON 7.12.06 IN THE CASH BOOK/ROJNAMACHA WAS SHO WN TO BE MADE ON 5 TH AND 6 TH DECEMBER,2006 AND THE SOURCE THEREOF WAS WITHDRAWA L OF RS.1 LAKH FROM THE BANK THOUGH THE SAME WAS ACTU ALLY WITHDRAWN ON 7.12.06. APPARENTLY, THE PAYMENT WAS MADE FROM U NDISCLOSED SOURCES AND TO COVER UP THE POSITION, THE CASH WITH DRAWN FROM BANK ON 7.12.06 WAS TAKEN ON 5.12.06. 2.4 SIMILAR IS THE POSITION IN THE CASH OF WITHDRAWA L OF RS.80,000/-. THE AMOUNT WAS ACTUALLY WITHDRAWN ON 8 .12.06 BUT THE SAME WAS TAKEN IN THE CASH BOOK ON 7.12.2006 AND PA RT OF WHICH WAS UTILIZED ON THAT DAY ITSELF. 2.5 IN VIEW OF THE FACTS DISCUSSED ABOVE, THE PLEA O F THE APPELLANT THAT ADDITION WAS MADE BY THE AO WITHOUT CONSIDERING THE ENTRIES IN ROJNAMACHA IS NOT CORRECT. THE APPELLAN T INTRODUCED THE FUNDS IN THE GUISE OF WITHDRAWALS FROM BANK TO MEET OUT ITS REQUIREMENT OF CASH THOUGH THE FUND WAS WITHDRAWN F ROM THE BANK ON A LATER DATE. THE APPELLATE AS SUCH HAS NOT BEEN AB LE TO EXPLAIN THE ENTRIES OF RS.1,00,000/- AND OF RS.80,000/- MADE IN THE CASH BOOK ON 5 TH AND 7 TH DECEMBER,2006 AND HENCE ADDITION THEREOF MADE BY T HE AO IS, HEREBY CONFIRMED. AS FAR AS REFERENCE OF IN DIAN EVIDENCE ACT MADE BY THE APPELLANT IN THE WRITTEN SUBMISSION, IT IS NOTED THAT THE INCOME-TAX ACT 1961 IS A COMPLETE CODE IN ITSELF AN D HENCE REFERENCE MADE BY THE APPELLANT IS OF NO HELP. 2.6 AS FAR AS THE 3 RD ENTRY OF RS.35,000/- IS CONCERNED, IT IS NOTED THAT THE AMOUNT WAS WITHDRAWN FROM THE BANK O N 15.02.2007 5 WHEREAS THE SAME WAS ENTERED IN THE CASH BOOK ON 16 .02.2007 AND AS SUCH NO ADDITION CAN BE MADE ON THIS AMOUNT. THE AD DITION MADE BY THE AO IS, THEREFORE CONFIRMED UPTO THE EXTENT OF R S.1,80,000/- ONLY. 10. THE ASSESSEE HAS NOT CONTROVERTED THE FINDINGS OF CIT(A). THE ASSESSEE HAS EVEN FAILED TO ESTABLISH WITH EVIDENCE THAT THE EXPENDITURE CLAIMED ON 5.12.2006 IN THE FIRST COUNT ON WHICH DA TE THE CASH OF RS.1 LAC WAS INTRODUCED HAS BEEN INCURRED NOT ON 5.12.20 06 BUT ON 7.12.2006. SIMILAR IS THE POSITION WITH REGARD TO THE INTRODUC TION OF CASH OF RS.80,000/- AND CORRESPONDING EXPENDITURE ON THE SA ID DATE. IN THE ABSENCE OF THE ASSESSEE HAVING DISCHARGED ITS ONUS I AM IN CONFORMITY WITH THE ORDER OF THE CIT(A) AND CONFIRM THE ADDITI ON OF RS.1,80,000/-. THE GROUND OF APPEAL RAISED BY THE ASSESSEE IS THUS DISMISSED. 11. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS DI SMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 30 TH DAY OF JUNE, 2011. SD/- (SUSHMA CHOWLA) JUDICIAL MEMBER DATED : 30 TH JUNE, 2011 RATI COPY TO: THE APPELLANT/THE RESPONDENT/THE CIT(A)/TH E CIT/THE DR. TRUE COPY BY ORDER ASSISTANT REGISTRAR, ITAT, CHANDIGARH