SHRI VIKAS ARORA, AMRITSAR V. INCOME TAX OFICER, WARD2(3, AMRITSAR

ITA 255/ASR/2018

• Counselvise Citation: [2019] 118 COUNSELVISE.COM (IT) 4132 (ITAT-AMRITSAR)
• Duration Of Justice: 9 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-02-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2014-2015
• Appeal Filed On: 02-05-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: RAJ KUMAR ARORA
• Keywords: Business income
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH, AMRITSAR (SMC) BEFORE SH. SANJAY ARORA, ACCOUNTANT MEMBER I.T.A. NO. 255/ASR/2018 AS SESSMENT YEAR: 2014-15 VIKAS ARORA, 1883/VIII-16 OPPOSITE PLOT NO. 164, SHAKTI NAGAR, AMRITSAR [PAN: ACEPA 9950B] VS. INCOME TAX OFFICER, WARD 2(3), AMRITSAR (APPELLANT) (RESPONDENT) APPELLANT BY : SH. RAJ KUMAR ARORA, ADV . RESPONDENT BY: SH. CHARAN DASS (D.R.) DATE OF HEARING: 14.02.2019 DATE OF PRONOUNCEMENT: 15.02.2019 ORDER PER SANJAY ARORA, AM: THIS IS AN APPEAL BY THE ASSESSEE DIRECTED AGAINST THE ORDER BY THE COMMISSIONER OF INCOME TAX (APPEALS)-1, AMRITSAR (' CIT(A)' FOR SHORT) DATED 05.02.2018, PARTLY ALLOWING THE ASSESSEES APPEAL C ONTESTING HIS ASSESSMENT U/S. 143(3) OF THE INCOME TAX ACT, 1961 ('THE ACT' HEREI NAFTER) DATED 27.12.2016 FOR THE ASSESSMENT YEAR (AY) 2014-15. 2. THE APPEAL RAISES A SINGLE ISSUE, I.E., THE SUST AINABILITY OF THE ADDITION IN THE SUM OF RS.1,65,000/-, BEING THE AMOUNT CREDITED IN THE ASSESSEES SAVING BANK ACCOUNT WITH ORIENTAL BANK OF COMMERCE, AMRITSAR CH OWK, AMRITSAR (OBC FOR SHORT) ON 03.4.2013, AS UNEXPLAINED, I.E., IN THE F ACTS AND CIRCUMSTANCES OF THE CASE. ITA NO. 255/ASR/2018 (AY 2014-15) VIKAS ARORA V. ITO 2 3. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSE E IS A DEALER IN CONFECTIONARY ITEMS, SELLING GOODS OF VARIOUS COMPANIES, VIZ. BRI TTANIA. THE IMPUGNED DEPOSIT, RECEIVED BY CHEQUE, WAS EXPLAINED TO BE AN ADVANCE FROM ONE, HARISH KUMAR, STATED TO BE AN EMPLOYEE OF A SUPPLIER, FERRARO IND IA PVT. LTD., AGAINST PURCHASE OF GOODS, AND TO WHOM SALES WERE ACCORDINGLY MADE. AS, HOWEVER, THE ADDRESS OF THE CREDITOR, HARISH KUMAR, OR HIS LEDGER ACCOUNT (IN T HE BOOKS OF THE ASSESSEE), WAS NOT FURNISHED, THE ASSESSING OFFICER (AO) TREATED T HE AMOUNT RECEIVED AS UNEXPLAINED. IN APPEAL, THE ASSESSEE FURNISHED THE LEDGER ACCOUNT EXHIBITING SALES TO THE DEPOSITOR DURING THE MONTH OF APRIL, 2013 IT SELF, FOR RS.1.65 LACS, ADJUSTING, THUS, THE ENTIRE ADVANCE AMOUNT (PB PG. 8). CONFIRM ATORY LETTER AND PERMANENT ACCOUNT NUMBER (PAN) OF THE CREDITOR, AS WELL THE C OPY OF HIS HDFC BANK ACCOUNT, I.E., ON WHICH BANK THE CHEQUE WAS DRAWN, WERE ALSO SUBMITTED (PB PGS. 4,5). THE SAME, HOWEVER, DID NOT FIND FAVOUR WITH T HE LD. CIT(A) AS THE CONFIRMATION LETTER DID NOT MENTION THE CREDITORS PAN. NO DETAILS OF THE CREDITWORTHINESS OR OF THE GOODS PURCHASED BY HIM F ROM THE ASSESSEE HAD BEEN FURNISHED. THE ADDITION WAS ACCORDINGLY CONFIRMED ( PARA 7(F) OF THE IMPUGNED ORDER). AGGRIEVED, THE ASSESSEE IS IN SECOND APPEAL . 4. I HAVE HEARD THE PARTIES, AND PERUSED THE MATERI AL ON RECORD. THE LD. COUNSEL FOR THE ASSESSEE, SH. ARORA, WOULD SHOW THAT THE PA N OF HARISH KUMAR, CREDITOR, IS MENTIONED IN HIS CONFIRMATION LETTER, WHICH ALSO BE ARS HIS COMPLETE ADDRESS. HE, FURTHER, INSISTING THAT THE LEDGER ACCOUNT OF THE D EPOSITOR WAS ALSO FURNISHED BEFORE THE FIRST APPELLATE AUTHORITY, OF WHICH THERE IS TH OUGH NO MENTION IN THE APPELLATE ORDER, THE APPELLATE RECORD WAS CALLED FOR, TO FIND THE SAME ON RECORD. THE LD. CIT(A) HAS THUS CLEARLY COMMITTED AN ERROR WHEN HE STATES THAT THE CREDITORS PAN IS NOT MENTIONED IN HIS CONFIRMATORY LETTER, OR NO LEDGER ACCOUNT SHOWING SALE OF GOODS BY THE ASSESSEE HAD BEEN FURNISHED (AT PARA 7 (F) (SUPRA)). FURTHER, IF HE ITA NO. 255/ASR/2018 (AY 2014-15) VIKAS ARORA V. ITO 3 ENTERTAINED ANY DOUBT WITH REGARD TO THE SALE ENTRI ES, HE OUGHT TO HAVE REQUIRED THE ASSESSEE TO FURNISH THE RELEVANT BILLS OR OTHER DET AILS, VIZ. TRANSPORTATION, ETC., TOWARD ESTABLISHING THE SAID SALE. THE COPY OF THE BANK ACCOUNT OF SH. HARISH KUMAR PROVES HIS IDENTITY AS WELL AS CAPACITY, INAS MUCH AS THE BUILD- UP OF THE BALANCE IS GRADUAL AND FROM EXPLAINED SOURCES. AS, HOWEVER, THE LEDGER ACCOUNT FURNISHED (PB PG. 8) WAS IN THE BOOKS OF M/S. CHAIT ANYA ENTERPRISE (OUTSIDE BHAGTANWALA GATE, AMRITSAR), SH ARORA WAS ASKED DUR ING HEARING ABOUT THE RELATIONSHIP BETWEEN THE ASSESSEE AND THE SAID FIRM . HE EXPLAINED IT TO BE THE ASSESSEES PROPRIETARY CONCERN, THE BUSINESS INCOME OF WHICH HAS BEEN RETURNED AND ASSESSED. COPIES OF THE ASSESSEES RETURN (COMP UTATION OF INCOME) REFLECTING INCOME FROM M/S. CHAITANYA ENTERPRISES, AS WELL AS THE PROFIT AND LOSS ACCOUNT OF THE SAID FIRM, SIGNED BY SH. VIKAS ARORA AS PROPRIE TOR, WERE SUBMITTED IN EVIDENCE (COPY ON RECORD). 5. I, UNDER THE CIRCUMSTANCES, HAVE NO REASON NOT T O ACCEPT THE ASSESSEES STAND OF THE IMPUGNED CREDIT IN HIS BOOKS OF ACCOUNT AS B EING SATISFACTORILY EXPLAINED. I DECIDE ACCORDINGLY. 6. IN THE RESULT, THE ASSESSEES APPEAL IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON FEBRUARY 15, 2019 SD/- (SANJAY ARORA) ACCOUNTANT MEMBER DATE: 15.02.2019 /GP/SR. PS. COPY OF THE ORDER FORWARDED TO: (1) THE APPELLANT: VIKAS ARORA, 1883/VIII-16, OPPOSITE PLOT NO. 164, SHAKTI NAGAR, AMRITSAR (2) THE RESPONDENT: INCOME TAX OFFICER, WARD 2( 3), AMRITSAR (3) THE CIT(APPEALS)-1, AMRITSAR (4) THE CIT CONCERNED ITA NO. 255/ASR/2018 (AY 2014-15) VIKAS ARORA V. ITO 4 (5) THE SR. DR, I.T.A.T. TRUE COPY BY ORDER