ITO, UDAIPUR V. Shri Devi Lal Gayari, UDAIPUR

ITA 263/JODH/2013

• Counselvise Citation: 26323314 RSA 2013
• Duration Of Justice: 5 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-10-2013
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2008-2009
• Appeal Filed On: 03-05-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: N A JOSHI
• Keywords: Income from undisclosed sources; Peak credit

Judgement Text

IN THE INCOME TAX APPELALTE TRIBUNAL: JODHPUR BENCH : JODHPUR BEFORE SHRI HARI OM MARATHA, JUDICIAL MEMBER AND SHRI N.K. SAINI, ACCOUNTANT MEMBER. ITA NO. 263/JODH/2013 (A.Y. 2008-09) THE I.T.O., VS SHRI DEVI LAL GAYARI WARD 2(1) S/O SHRI GANESH LAL GAYARI UDAIPUR V & P BHESDA, KAL MAGRI TEH GIRWA DISTT, UDAIPUR . PAN NO. ADVPG 0284 A (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI AMIT KOTHARI DEPARTMENT BY : SHRI N.A. JOSHI- DR. DATE OF HEARING : 07/10/2013. DATE OF PRONOUNCEMENT : 07/10/2013. O R D E R PER HARI OM MARATHA, J.M . : THIS APPEAL OF THE REVENUE, FOR A.Y. 2008-09, IS D IRECTED AGAINST THE ORDER OF LD. CIT(A), UDAIPUR DATED 01/02/2013. 2 2. BRIEFLY STATED, THE FACTS OF THE CASE ARE THAT T HE ASSESSEE IS A LABOUR CONTRACTOR AND MANUFACTURER OF LIME STONE PO WDER. FOR A.Y. 2008-09, HE FILED HIS RETURN OF INCOME [ROI]) ON 29 /08/2008 DECLARING TOTAL INCOME OF RS. 2,17,520/-. AS AGAINST THIS, AS SESSMENT WAS COMPLETED AT A TOTAL INCOME OF RS. 19,81,440/-. IN ARRIVING AT THE ABOVE COMPUTATION OF TOTAL INCOME, THE A.O. HAS MAD E ADDITION OF RS. 25,000/- ON ACCOUNT OF DISALLOWANCE OF EXPENSES DIS CUSSED IN PARA 3 OF THE ASSESSMENT ORDER AND BY MAKING ADDITION OF RS. 17,38,810/- AS INCOME FROM UNDISCLOSED SOURCES [CASH DEPOSITS]. A PART FROM THIS, HE HAS ALSO ADDED RS. 110/- ON ACCOUNT OF INTEREST ON THIS UNDISCLOSED INCOME. AGGRIEVED, THE ASSESSEE FILED APPEAL AND T HE LD. CIT(A) HAS DELETED MAJOR PORTION OF THE ADDITION. THAT IS WHY THE REVENUE IS IN APPEAL BEFORE THE APPELLATE TRIBUNAL. 3. FIRST GROUND PERTAINS TO DELETION OF DISALLOWANC E OF RS. 25,000/- ADDED OUT OF TRANSPORTATION AND WAGES EXPENSES WHIC H HAS BEEN DELETED BY THE LD. CIT(A). 3.1 FACTS OF THIS GROUND ARE THAT, ON EXAMINATION O F INCOME AND EXPENDITURE ACCOUNT OF M/S GURU KRIPA DYECHEM, THE A.O. NOTICED THAT TRANSPORTATION EXPENSES OF RS. 1,69,965/- AND WAGES EXPENSES OF RS. 3 3,19,372/- HAVE BEEN CLAIMED. OUT OF THIS TOTAL CL AIM, THE A.O. HAS DISALLOWED LUMPSUM AMOUNT OF RS. 25,000/- ON ACCOUN T OF BEING NON- VERIFIABLE. THE LD. CIT(A) HAS DELETED THIS LUMPSU M ADDITION KEEPING IN VIEW THE RELEVANT FACTS OF THE CASE WHERE THE PAYEE S ARE ILLITERATE PERSONS AND THE A.O. HAS NOT FOUND ANYTHING ADVERSE IN THE BOOKS OF ACCOUNT. 3.2 BEFORE US, BOTH THE PARTIES HAVE REITERATED THE IR EARLIER STAND. IN THE GIVEN FACTS AND CIRCUMSTANCES OF THE CASE, WE A LSO HOLD THAT THIS LUMPSUM AND ADHOC DISALLOWANCE CANNOT BE SUSTAINED. THE A.O. HAS NOT GIVEN ANY LOGIC FOR MAKING THIS DISALLOWANCE. THEREFORE, GROUND NO. 1 OF REVENUES APPEAL CANNOT BE ALLOWED AND STA NDS DISMISSED. 4. FACTS OF GROUND NO. 2 WHICH CHALLENGES THE RESTR ICTION OF ADDITION OF RS. 17,38,810/- TO RS. 54,027/- ON THE BASIS OF PEAK THEORY ARE THAT THE ASSESSEE MAINTAINED AN ACCOUNT WITH IDBI BANK L TD, UDAIPUR. COPY OF BANK ACCOUNT OBTAINED FOR THE PERIOD FROM OPENIN G DATE TO 7.10.2010 REVEALED THAT THE ASSESSEE DID NOT DISCLO SE THIS BANK ACCOUNT TO THE DEPARTMENT AND THE ASSESSEE HAD DEPOSITED CA SH AGGREGATING TO RS. 17,38,810/- ON VARIOUS DATES DURING F.Y. 2007-0 8. WHEN ASKED TO EXPLAIN THE SOURCE OF THESE DEPOSITS, THE ASSESSEE REPLIED VIDE LETTER 4 DATED 5.10.2010 THAT THIS ACCOUNT DID NOT BELONG TO THE ASSESSEE AND WAS BEING UNAUTHORIZEDLY OPERATED BY SHRI VIKAS KUM AR MODI, WHO IS ASSESSEES CUSTOMER. THE ASSESSEE REMAINED OUT OF STATION FOR LONG TIME IN CONNECTION WITH CONTRACT WORK AND WAS NOT A WARE OF SUCH OPERATIONS IN THIS ACCOUNT. MR. MODI HAD PAID BALA NCE AMOUNT IN THIS ACCOUNT. HE PRESUMED THAT NECESSARY FORMALITIES FO R CLOSURE OF ACCOUNT HAD BEEN DONE. ALL THE WITHDRAWALS ARE UND ISPUTEDLY BY WAY OF ATM CARD WHICH WAS DELIVERED AT MR. MODIS RESID ENTIAL ADDRESS. THE STATEMENT OF THE ASSESSEE WAS RECORDED ON 5.10. 2010 AND HE REPEATED THE SAME FACTS. HE FURTHER STATED THAT IN THE ACCOUNT OPENING FORM, THE NAME OF MR. MODI IS APPEARING AS WITNESS. THE ASSESSEE ALSO FILED FIR WITH POLICE STATION AND COP Y OF WHICH WAS PRODUCED BEFORE THE A.O. THE A.O. WANTED MR. MODI TO BE PRODUCED, BUT THE ASSESSEE COULD NOT PRODUCE BECAUSE OF THE D IFFERENCES AS STATED ABOVE. THE A.O. DID NOT AGREE AND MADE ENTI RE ADDITION. HOWEVER, THE LD. CIT(A) HAS CONSIDERED THE SUBMISSI ONS IN THEIR CORRECT PERSPECTIVE AND HAVE ONLY SUSTAINED PEAK CREDIT AS REVEALED FROM BANK PASS BOOK WHICH WORKS OUT TO RS. 54,027/- ON 9.6.20 07. 5 4.1 BEFORE US, BOTH THE PARTIES REITERATED THEIR EA RLIER ARGUMENTS. AFTER CONSIDERING THE RIVAL SUBMISSIONS WITH REFERE NCE TO PAPER BOOK AND RELEVANT DOCUMENTS, WE HAVE FOUND THAT THIS ACC OUNT WAS OPENED IN ASSESSEES NAME TO FACILITATE HIS CUSTOMER MR. M ODI WHO HAS OPERATED THIS ACCOUNT FOR HIS PERSONAL USE AND WHEN THE ASSESSEE CAME TO KNOW ABOUT THE ILLEGAL CONTINUANCE OF THE ACCOUN T WITH IDBI, HE ALSO LODGED COMPLAINT WITH THE POLICE. THIS SHOWS THAT IN REALITY, THIS BANK ACCOUNT REALLY BELONGS TO MR. MODI. NEVERTHEL ESS, THE LD. CIT(A) HAS CHOSEN TO MAKE ADDITION OF PEAK CREDIT OF RS. 5 4,027/- TO BE MORE FAIR TO BOTH THE PARTIES. SINCE THE ASSESSEE IS NO T IN APPEAL BEFORE US, WE CHOSE TO NOT INTERFERE IN THE FINDING OF THE LD. CIT(A) AND CONFIRM HIS FINDING IN THIS REGARD. 5. IN THE RESULT, THE APPEAL OF THE REVENUE STANDS DISMISSED. ORDER PRONOUNCED IN THE COURT ON 7 TH OCTOBER, 2013. SD/- SD/- (N.K.SAINI) [HARI OM MAR ATHA] ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 7 TH OCTOBER, 2013. VL/ 6 COPY TO:- THE APPELLANT THE RESPONDENT THE CIT BY ORDER THE CIT(A) THE DR ASSISTANT REGISTRAR ITAT, JODHPUR