Shri Vijay Jivanlal Ballani, Ahmedabad V. The Income Tax Officer, Ward-3(3), Ahmedabad

ITA 2682/AHD/2013

• Counselvise Citation: [2017] 130 COUNSELVISE.COM (IT) 9046 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 3 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-03-2017
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: SMC
• Next Hearing Date: 15-02-2017
• Assessment Year: 2008-2009
• Appeal Filed On: 18-11-2013
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: DIMESH SINGH
• Keywords: Principle of natural justice; Additional evidence
• Section: 144

Judgement Text

, SMC , IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH, AHMEDABAD .., , BEFORE SHRI S.S. GODARA, JUDICIAL MEMBER AND SHRI PRADIP KUMAR KEDIA, ACCOUNTANT MEMBER ./ I.T.A. NO.2682/AHD/2013 ( / ASSESSMENT YEAR : 2008-09) VIJAY JIVANLAL BALLANI 4-B, HARINAGER SOCIETY KANKARIYA AHMEDABAD-380 002 / VS. THE ITO WARD-3(3) AHMEDABAD $ ./ ./ PAN/GIR NO. : AAYPB 4057 G ( $' / APPELLANT ) .. ( ($' / RESPONDENT ) $') / APPELLANT BY : NONE ($'*) / RESPONDENT BY : MR.DIMESH SINGH, SR.DR +,*- / DATE OF HEARING 15/02/2017 ./0*- / DATE OF PRONOUNCEMENT 06/ 03/2017 / O R D E R PER PRADIP KUMAR KEDIA, AM: THE CAPTIONED APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX(APPEALS)-III, AHM EDABAD [CIT(A) IN SHORT] DATED 22/08/2013 FOR THE ASSESSMENT YEAR (AY) 2008-09. 2. THE GROUNDS OF APPEAL RAISED BY THE ASSESSEE R EAD AS UNDER:- ITA NO.2682/AHD /2013 VIJAY JIVANLAL BALLANI VS. ITO ASST.YEAR 2008-09 - 2 - 1. THE LEARNED CIT(A) HAS ERRED IN LAW AND ON FACTS IN CONFIRMING THE ACTION OF AO IN MAKING ADDITION OF RS.20,13,530 /- ON ACCOUNT OF UNEXPLAINED MONEY U/S.69A OF THE INCOME TAX ACT, 1961. 2. BOTH THE LOWER AUTHORITIES HAVE PASSED THE ORDERS W ITHOUT PROPERLY APPRECIATING THE FACT AND THAT THEY FURTHE R ERRED IN GROSSLY IGNORING VARIOUS SUBMISSIONS, EXPLANATIONS AND INFORMATION SUBMITTED BY THE4 APPELLANT FROM TIME T O TIME WHICH OUGHT TO HAVE BEEN CONSIDERED BEFORE PASSING THE IMPUGNED ORDER. THIS ACTION OF THE LOWER AUTHORITI ES IS IN CLEAR BREACH OF LAW AND PRINCIPLES OF NATURAL JUSTICE AND THEREFORE DESERVES TO B E QUASHED. 3. THE LD.CIT(A) HAS ERRED IN LAW AND ON FACTS IN CONF IRMING THE ACTION OF LD.AO IN CHARGING INTEREST U/S.234B/C/D O F THE ACT. 4. THE LD.CIT(A) HAS ERRED IN LAW AND ON FACTS IN CONF IRMING THE ACTION OF LD.AO IN INITIATING PENALTY PROCEEDINGS U /S.27191)(C) OF THE ACT. 3. WHEN THE MATTER WAS CALLED FOR HEARING, NONE AP PEARED FOR THE ASSESSEE. IT IS SEEN FROM THE RECORD THAT THE NOTI CE HAS BEEN SERVED ON THE ASSESSEE BY REGISTERED POST INTIMATING THE DATE OF HEARING. THE ASSESSEE HAS NEITHER ATTENDED NOR SOUGHT ANY ADJOURNMENT. T HUS, IT CAN BE PRESUMED THAT THE ASSESSEE IS NOT INTERESTED IN PRO SECUTING THE APPEAL. ACCORDINGLY, THE MATTER IS PROCEEDED EX-PARTE IN THE ABSENCE OF THE ASSESSEE. ITA NO.2682/AHD /2013 VIJAY JIVANLAL BALLANI VS. ITO ASST.YEAR 2008-09 - 3 - 4. THE LD.DR POINTED OUT THAT THE ASSESSEE FAILED TO COMPLY WITH THE STATUTORY NOTICES EVEN BEFORE THE ASSESSING OFFICER (AO) IN THE INSTANT CASE. THE LD.DR RELIED UPON THE FINDINGS GIVEN BY THE CIT(A) AND THE AO. 5. WE HAVE PERUSED THE ORDERS OF THE AUTHORITIES B ELOW. THE SOLITARY QUESTION THAT ARISES IN THE PRESENT APPEAL IS WHETH ER THE CIT(A) WAS JUSTIFIED IN CONFIRMING THE ADDITIONS OF RS.20,13,5 30/- MADE BY THE AO TOWARDS UNEXPLAINED CASH DEPOSITS. IN ORDER TO ADD RESS THE ISSUE, THE RELEVANT PORTION OF THE ORDER OF THE CIT(A) IS EXTR ACTED HEREUNDER:- 3. GROUND NO.1 OF THE APPEAL IS REGARDING ADDITION OF RS.20,13,530/- U/S. 69A. 4. RETURN DECLARING TOTAL INCOME OF RS.1,14,096/- W AS FILED BY THE APPELLANT. ON THE BASIS OF AIR INFORMATION, AO FOUN D THAT DURING THE YEAR THERE ARE TOTAL CASH DEPOSITS OF RS.20,13,530/ - IN BANK ACCOUNT OF THE APPELLANT. APPELLANT WAS ASKED TO EXPLAIN SOURC E OF THE SAME. AS NO REPLY WAS FURNISHED BEFORE AO, HE MADE ADDITION OF RS.20,13,5307- U/S. 69A. 5. APPELLANT FILED HIS WRITTEN SUBMISSIONS IN WHICH HE ARGUED THAT 'I. ASSESSEE'S ACCOUNT IS SMALL AND EASY TO MAINTAI N AND DO NOT INVOLVE COMPLEXITY OF ANY KIND, SO ASSESSEE NORMALLY MAINTA INS HIS ACCOUNTS BY HIRING PART TIME ACCOUNTANT AT THE END OF THE YE AR. IN CASE OF ASSESSMENT YEAR 2008-09 ASSESSEE MAINTAINED THE ACC OUNTS IN THE SAME WAY. WHEN HIS CASE WAS SELECTED FOR SCRUTINY A ND NOTICE FOR THE SAME WAS RECEIVED BY THE ASSESSEE, HE SENT IT DIREC TLY TO THE ACCOUNTANT AS HE WAS NOT ABLE TO UNDERSTAND TECHNICAL MATTERS OF THE PAPER FROM I. T. DEPARTMENT AND ALSO IGNORANT OF HOW TO DEAL WITH THE CASE. ITA NO.2682/AHD /2013 VIJAY JIVANLAL BALLANI VS. ITO ASST.YEAR 2008-09 - 4 - WHENEVER ANY NOTICE-CAME FROM I.T. DEPARTMENT HE US ED TO SEND IT TO THE HIRED ACCOUNTANT. HE HAS TRUST ON THE ACCOUNTAN T THAT HE WOULD DEAL ACCORDINGLY ON THE NOTICE AS HE IS BETTER KNOW ING ACCOUNTS AND TAXATION MATTER. HOWEVER UNFORTUNATELY THE ACCOUNTA NT HAS IGNORED ALL THE NOTICES AND LET THE TIME SPENT. ASSESSEE WAS ON THE HOPE THAT THE ACCOUNTANT MUST HAVE CLEARED THE MATTER ON HIS WAY. WHENEVER NOTICE FROM 1. T.O. WAS RECEIVED HE RESPONDED THAT THESE A RE PROCEDURAL ASPECT AND NEED NOT TO TENSE HE WOULD HANDLE THE MA ILER. HOWEVER WHEN ASSESSEE RECEIVED NOTICE FROM ITO ON 01/12/201 0 HE READ IT AND NOT UNDERSTAND MUCH BUT AT LEAST THAT HE WAS SOMEWH ERE PENALIZED FOR CERTAIN BREACH OF LAW. THIS TIME HE DECIDED TO GO T O OTHER TAX CONSULTANT WHO ACKNOWLEDGES HIM THE REALITIES AND S ERIOUSNESS OF THE CASE. ALSO HE WAS ADVISED TO ATTEND EVERY MEETING E ITHER HIMSELF OR THROUGH TAX CONSULTANT OTHERWISE HE WILL BECOME DEF AULTER IN THE EYES OF INCOME TAX DEPARTMENT. THEN THE ASSESSEE DECIDED TO ATTEND THE HEARING PERSONALLY BUT IT WAS TOO LATE. HENCE, WE REQUEST YOU KINDLY ALLOW THE ASSESSEE TO PRODUCE ADDITIONAL EVIDENCES WHICH HE WAS NOT ABLE TO PROVIDE EARLIER BECAUSE OF MISTAKE OF THE ACCOUNTANT. PLEASE CONSIDER THE CIRCUMSTANC ES (AS MENTIONED ABOVE) AS FALLING UNDER RULE 46 A OF INCOME TAX ACT , 1961. 2. WE ARE ENCLOSING HEREWITH THE COPY OF IT RETURN OF A. Y. 2008-09, COMPUTATION OF INCOME, TRANSLATED BALANCE SHEET AND PROFIT & LOSS ACCOUNT FROM GUJARATI TO ENGLISH ALONG WITH LIST OF DEBTORS AND CREDITORS AS PER ANNEXURE A. 3. AS PER POINT NO. 7.1 OF ASSESSMENT ORDER U/S 144 DATED 16712/2010, THE RESPECTED ASSESSING OFFICER HAS CONSIDERED THE CASH DEPOSITS OF RS. 20,73,530/- AS INVESTMENTS IN BONDS/DEBENTURE. COPY OF KOTAK MAHINDRA BANK STATEMENT FOR THE YEAR 2007-08 IS ENCLOSED HEREWITH AS PER ANNEXURE B. BANK STATEMENT IN ORIGINAL IS ALSO PROVIDED HEREWITH FOR YOUR KIND PERUSAL. 4. AS PER POINT NO. 5 & 6 OF ASSESSMENT ORDER U/ S 144 DATED 16/12/2010, THE RESPECTED ASSESSING OFFICER HAS DISALLOWED DALA LI EXP, TELEPHONE EXP, PETROL EXP, AND SHOP EXP OF RS. 5004/-, 8410/-, 25 52/-, 2450/- AND 2887/- RESPECTIVELY. THESE ARE THE ROUTINE EXPENSES OF THE BUSINESS CLAIMED IN IT RETURN. WE WILL PROVIDE VOUCHERS/SUPPORTING DOCUMEN TS FOR THE SAME WHENEVER ASKED BY THE RESPECTED ASSESSING OFFICER F OR KIND PERUSAL. ITA NO.2682/AHD /2013 VIJAY JIVANLAL BALLANI VS. ITO ASST.YEAR 2008-09 - 5 - 5. ANY OTHER PAPERS OR DOCUMENTS, LEDGER ETC. IF RE QUIRED BY THE RESPECTED ASSESSING OFFICER, THEN WE WILL PROVIDE THE SAME AS AP. 6. A COPY OF THE WRITTEN SUBMISSIONS WAS FORWARDED TO THE AO BY MY PREDECESSOR AND HE WAS ASKED TO FURNISH A REPORT ON THE SAME. AO FURNISHED HIS REPORT VIDE HIS LETTER NO.ITO/WD-3(3) /AHD/VJB/2012-13 DATED 20/12/2012 IN WHICH HE STATED THAT '2. VIDE THE ABOVE REFERRED LETTER YOUR HONOUR FURN ISHED ORIGINAL SUBMISSION OF ASSESSEE'S CHARTERED ACCOUNTANT J. S. JAIN & ASSOCIATES DT 24/08/2012 ALONGWITH STATEMENT OF TOTAL INCOME, BALANCE SHEET & PROFIT & LOSS ACCOUNT AND LIST OF DEBTORS & CREDITO RS AND REQUESTED THE UNDER SIGNED FOR OFFER OF COMMENTS ON THE ADMIS SIBILITY OF THE ADDITIONAL EVIDENCES AND ITS MERITS. HOWEVER THE ASSESSES HAS NOT GIVEN ANY EXPLANATION REGARDING SOURCE OF CASH DEPO SITED WITH NECESSARY EVIDENCES. 3. IN VIEW THE ABOVE IT IS UNABLE TO MAKE ANY COMME NTS ON ADDITIONAL EVIDENCES. IF THE ASSESSEE HAS GIVEN ANY EVIDENCES REGARDING SOURCE OF CASH CREDIT THE SAME MAY KINDLY BE FORWARDED TO UND ERSIGNED SO THAT COMMENTS ON THE SAME CAN BE GIVEN.' 7. FACTS OF THE CASE AND ARGUMENTS OF THE APPELLANT HAVE BEEN CAREFULLY CONSIDERED. FROM THE PERUSAL OF BANK STATEMENT OF A PPELLANT IT IS FOUND THAT THERE ARE CASH DEPOSITS OF VARIOUS AMOUNTS SUC H AS RS.L5,000/-, RS.48,000/-, RS.33,000/-, ETC. ON VARIOUS DATES. I T HAS BEEN CLAIMED BY THE APPELLANT THAT ALL THESE ARE BUSINESS TRANSACTI ONS BUT NO EVIDENCE IN SUPPORT OF THE SAME HAS BEEN FILED EITHER BEFORE AO OR THE UNDERSIGNED. NO BOOKS OF ACCOUNTS WERE PRODUCED EITHER BEFORE AO OR THE UNDERSIGNED. IT APPEARS THAT NO BOOKS OF ACCOUNT HA VE BEEN MAINTAINED BY THE APPELLANT. IF THE CASH DEPOSITS ARE IN RESPE CT OF THE SALE TRANSACTIONS, THEN THE ASSESSEE SHOULD HAVE PROVIDE D NAMES AND ADDRESSES OF AT LEAST FEW PARTIES FROM WHOM THE CAS H WAS RECEIVED. BUT NO NAME OR ADDRESS HAS BEEN FURNISHED EVEN IN A SIN GLE CASE. IN SUCH A SITUATION, AO HAS RIGHTLY CONCLUDED THAT THE TOTAL DEPOSITS OF RS.20,13,530/- REPRESENT UNEXPLAINED MONEY U/S. 69A OF THE I.T. ACT. ADDITION OF RS.20,13,530/- MADE BY AO IS JUSTIFIED IN SUCH A SITUATION AND THE SAME IS CONFIRMED. GROUND NO.1 OF THE APPEA L IS DISMISSED. ITA NO.2682/AHD /2013 VIJAY JIVANLAL BALLANI VS. ITO ASST.YEAR 2008-09 - 6 - 6. A PERUSAL OF THE EXTRACT NOTED ABOVE WOULD SHOW THAT BASED ON THE AIR INFORMATION, THE AO FOUND CASH DEPOSITS TO THE TUNE OF RS.20,13,530/- WITH KOTAK MAHENDRA BANK FOR ACQUIRI NG BONDS/DEBENTURES IN THE FINANCIAL YEAR RELEVANT TO ASSESSMENT YEAR 2008-09. WE FIND THAT THE CIT(A) HAS EXAMINED THE ISSUE IN PERSPECTIVE. THE ORDER OF CIT(A) APPEARS REASONED AND PLAUSIBLE. IN THE ABSENCE OF ANY REBUTTAL FROM THE ASSESSEE, WE ARE NOT INCLINED TO INTERFERE WITH THE FINDINGS OF THE CIT(A). 7. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS DIS MISSED EX-PARTE. THIS ORDER PRONOUNCED IN OPEN COURT ON 06 / 0 3 /201 7 SD/- SD/- (..) ( ) ( S.S. GODARA ) ( PRADIP KUMAR KEDIA ) JUDICIAL MEMBER ACCOUNTANT MEMBER AHMEDABAD; DATED 06/ 03 /2017 4..+,.+../ T.C. NAIR, SR. PS ITA NO.2682/AHD /2013 VIJAY JIVANLAL BALLANI VS. ITO ASST.YEAR 2008-09 - 7 - !'#$#! / COPY OF THE ORDER FORWARDED TO : 1. $' / THE APPELLANT 2. ($' / THE RESPONDENT. 3. 567- 8- / CONCERNED CIT 4. 8- ( ) / THE CIT(A)-III, AHMEDABAD 5. 9:-+67 , 670 , 5 / DR, ITAT, AHMEDABAD 6. <, / GUARD FILE. / BY ORDER, (9-- //TRUE COPY// / ( DY./ASSTT.REGISTRAR) , / ITAT, AHMEDABAD