KETUR M BHAVSAR, MUMBAI V. ITO WD 16(3)(3), MUMBAI

ITA 2751/MUM/2011

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 0434 (ITAT-MUMBAI)
• Duration Of Justice: 6 year(s) 10 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-02-2018
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 20-09-2016
• Assessment Year: 2005-2006
• Appeal Filed On: 08-04-2011
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: RAJESH KUMAR YADAV
• Keywords: Unexplained cash credit; Peak credit
• Section: 143(3); 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, BENCH A, MU MBAI BEFORE SHRI G.S. PANNU, ACCOUNTANT MEMBER AND SHRI PAWAN SINGH, JUDICIAL MEMBER ITA NO.2751/MUM/2011 (ASSESSMENT YEAR- 2005-06) SHRI KETUR M. BHAVSAR, C/O HIMANSHU BHAVSAR, ROOM NO.7, 1 ST FLOOR, MANGAL BHUVAN, MANGLAWADI GIRGAON, MUMBAI-400004. PAN: AEZPB3498J VS. ITO WARD 16(3)(3), MUMBAI. (APPELLANT) (RESPONDENT) ASSESSEE BY : NONE (AR) REVENUE BY : SHRI RAJESH KUMAR YADAV (DR) DATE OF HEARING : 29.11.2017 DATE OF PRONOUNCEMENT : 13.02.2018 ORDER UNDER SECTION 254(1) OF INCOME TAX ACT PER PAWAN SINGH, JUDICIAL MEMBER : 1. THIS APPEAL BY ASSESSEE UNDER SECTION 253 OF INCOME TAX ACT IS DIRECTED AGAINST THE ORDER OF LD. COMMISSIONER OF INCOME-TAX (APPEALS)-27, [CIT(A)] MUMBAI DATED 20.12.2010 FOR ASSESSMENT YEA R 2005-06. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL : 1. THE LD. COMMISSIONER OF INCOME TAX(APPEALS)-27 MUMB AI [THE CIT(A)] ERRED IN CONFIRMING THE ADDITION U/S 68 OF INCOME T AX ACT, 1961 (THE ACT) AT PEAK CREDIT IN THE BANK ACCOUNT OF APPELLANT AT RS. 12,54,955/-. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) OUGHT TO HAVE HELD THAT THE DEPOSITS & WITHDRAWALS OF THE AP PELLANTS BANK ACCOUNT AS FULLY EXPLAINED. 3. THE APPELLANT PRAYS TO DELETE THE ADDITIONS CONFIRM ED BY THE LEARNED CIT(A) BE DELETED. 2 ITA NO.2751/M/2011 SHRI KETUR M. BHAVSAR 2. BRIEF FACTS OF THE CASE ARE THAT ASSESSEE IS PROPRI ETOR OF M/S NITIKA GEMS DEALING IN PRECIOUS, SEMI-PRECIOUS AND SYNTHETIC ST ONES, FILED HIS RETURN OF INCOME FOR RELEVANT AY ON 27.10.2005 DECLARING TOTA L INCOME AT RS.1,15,610/-. THE ASSESSMENT WAS COMPLETED 17/12/2 007 UNDER SECTION 143(3) OF THE ACT DETERMINING THE TOTAL INCOME OF R S. 41,21,290/-. THE ASSESSING OFFICER (AO) WHILE PASSING ASSESSMENT ORD ER BESIDES OTHER ADDITION AND DISALLOWANCE, MADE ADDITION OF RS. 34, 68,250/- UNDER SECTION 68 AS UNEXPLAINED CASH CREDIT IN BANK ACCOUNT. ON A PPEAL BEFORE THE LD. CIT(A), THE ADDITION WAS RESTRICTED TO RS. 12,54,95 5/-. THE LD. CIT(A) RESTRICTED THE ADDITION TO RS. 12,54,955/- ON THE B ASIS OF PEAK CREDIT. THUS, FURTHER AGGRIEVED BY THE ORDER OF LD. CIT(A), THE A SSESSEE HAS FILED THE PRESENT APPEAL BEFORE US. 3. NONE APPEARED ON BEHALF OF ASSESSEE, DESPITE SERVIC E OF NOTICE OF HEARING THROUGH R.P. AD. THIS APPEAL IS PENDING ADJUDICATIO N BEFORE THE TRIBUNAL SINCE 2011. THEREFORE, WE DECIDED TO HEAR THE SUBMI SSION OF LD. DR AND TO DECIDE THE APPEAL ON THE BASIS OF MATERIAL AVAILABL E ON RECORD. THE LD. DR FOR THE REVENUE SUPPORTED THE ORDER OF LD. CIT(A), IT WAS SUBMITTED THAT WHILE FILING RETURN OF INCOME, THE ASSESSEE DID NOT DISCLOSE THE CASH DEPOSIT IN HIS BANK ACCOUNT NO. 23510085371 IN STANDARD CH ARTERED BANK, S.G. MARG, MUMBAI. THE AO MADE THE ADDITION UNDER SECTIO N 68 FOR AGGREGATE OF THE AMOUNT DEPOSITED IN THE SAID ACCOUNT. THE AS SESSEE WAS GRANTED 3 ITA NO.2751/M/2011 SHRI KETUR M. BHAVSAR PARTIAL RELIEF BY THE LD. CIT(A) WHILE RESTRICTING THE ADDITION ON THE BASIS OF PEAK CREDIT. THE ASSESSEE IS NOT ENTITLED FOR FURTH ER RELIEF. 4. WE HAVE CONSIDERED THE SUBMISSION OF THE LD. DR AND PERUSED THE RECORD CAREFULLY. WE HAVE NOTED THAT DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE AO WAS HAVING INFORMATION ABOUT CASH DEPOSIT OF RS. 34,68,250/- IN BANK ACCOUNT NO. 23510085371 IN STANDARD CHARTERED BANK, S.G. MARG, MUMBAI. THIS ACCOUNT WAS NOT DISCLOSED BY ASSESSEE IN HIS RETURN OF INCOME. WHEN THIS ACCOUNT WAS CONFRONTED WITH ASSES SEE, THE ASSESSEE REMAINED SILENT AND NOT EXPLAINED THE DEPOSITS IN T HE SAID BANK. THE AO MADE ADDITION UNDER SECTION 68 FOR ENTIRE CASH DEPO SIT. DURING APPEAL BEFORE THE LD. CIT(A), THE ASSESSEE EXPLAINED THAT HIS ACCOUNT WAS PREPARED BY FREE LANCER PART TIME ACCOUNTANT, WHO DID NOT ME NTIONED THE SAID ACCOUNT DUE TO OVERSIGHT. THE ASSESSEE FURTHER EXPL AINED THAT THE SAID DEPOSIT AND WITHDRAWAL IN THE SAID ACCOUNT ARE PURC HASE AND SALE PROCEEDS OF HIS BUSINESS. THE LD. CIT(A) AFTER VERIFYING THE SAID ACCOUNT OBSERVED THAT THERE IS REGULAR CASH DEPOSIT AND CASH WITHDRA WAL ALMOST ON DAY TO DAY BASIS. THE LD. CIT(A) FURTHER OBSERVED THAT THE ASS ESSEE HAS NOT DISCLOSED THE COMPLETE INCOME FROM BUSINESS CARRIED OUT BY HI M AND IS LIABLE TO EXPLAIN PEAK CREDIT IN THE BANK ACCOUNT. ON THE B ASIS OF HIS OBSERVATION, LD. CIT(A) WORKED OUT PEAK CREDIT TO RS. 12,54,955/ - AS ON 10.03.2005, AND ACCORDINGLY SUSTAINED THE ADDITION TO THAT EXTENT. BEFORE US, NEITHER THE ASSESSEE NOR HIS REPRESENTATIVE EXPLAINED THE FACT AS TO WHY THE ADDITION 4 ITA NO.2751/M/2011 SHRI KETUR M. BHAVSAR SUSTAINED ON THE BASIS OF PEAK CREDIT IS LIABLE TO BE DELETED. THE ASSESSEE HAS NOT FILED ANY DOCUMENTARY EVIDENCE ON RECORD IN SUPPORT OF HIS THE GROUNDS OF APPEAL RAISED BEFORE US. HENCE, WE DO NO T FIND ANY MERIT IN THE GROUNDS OF APPEAL RAISED BY ASSESSEE, WHICH IN RESU LT DISMISSED. 5. IN THE RESULT, APPEAL FILED BY ASSESSEE IS DISMISSE D. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 13 TH DAY OF FEBRUARY, 2018. SD/- SD/- (G.S. PANNU) (PAWAN SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI; DATED 13/02/2018 S.K.PS COPY OF THE ORDER FORWARDED TO : BY ORDER, (ASSTT.REGISTRAR) ITAT, MUMBAI 1. THE APPELLANT 2. THE RESPONDENT. 3. THE CIT(A), MUMBAI. 4. CIT 5. DR, ITAT, MUMBAI 6. GUARD FILE. //TRUE COPY/