ITO, Sonepat V. Sh. Satbir Singh, Jhajjar

ITA 3038/DEL/2013

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 86530 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 8 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-01-2015
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: G
• Next Hearing Date: 26-11-2014
• Assessment Year: 2009-2010
• Appeal Filed On: 15-05-2013
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: IN FACTS
• Keywords: Additional evidence
• Section: 144

Judgement Text

DELHI BENCH E : NEW DELHI BEFORE SHRI N.K.SAINI, ACCOUNTANT MEMBER AND SHRI A. T. VARKEY, JUDICIAL MEMBER ITA NO. 3038 /DEL/ 2013 (ASSESSMENT YEAR: 2009 - 10 ) ITO, WARD - 4 SONEPAT VS. SATBIR SINGH, S/O SH. OM PARKASH VPO - SOLDHA, JHAJJAR PAN:BGUPS100E (APPELLANT) (RESPONDENT) O R D E R PER A. T. VARKEY, JUDICIAL MEMBER THIS IS AN APPEAL FILED BY THE DEPARTMENT ARISES F ROM THE ORDER OF THE LD CIT(A) , ROHTAK DATED 08 TH MARCH 2013 AND RELATES TO ASSESSMENT YEAR 2009 - 10. 2. THE REVENUE HAS RAISED THE FOLLOWING GROUNDS: - 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) HAS ERRED IN LAW AND IN FACTS BY DELETING THE ADDITION OF RS.19,60,200/ - MADE BY AO ON ACCOUNT OF UNEXPLAINED CASH DEPOSITS IN BANK ACCOUNT AS ASSESSEE FAILED TO FURNISH ANY SUSTAINABLE DOCUMENTARY EVIDENCE IN RESPECT OF THESE CASH DEPOSITS DURING ASSESSMENT PROCEEDINGS. 2. ON THE FACTS AND IN THE CIRCUMSTAN CES OF THE CASE, THE LD. CIT(A) HAS ERRED IN LAW AND IN FACTS BY DELETING THE ADDITION OF RS.19,60,200/ - MADE BY AO ON ACCOUNT OF UNEXPLAINED CASH DEPOSITS IN BANK ACCOUNT AS NO RELIABLE AND SUSTAINABLE DOCUMENTARY EVIDENCE WAS FURNISHED BY THE ASSESSEE DU RING REMAND AS WELL AS APPELLATE PROCEEDINGS IN RESPECT OF HIS CLAIM OF CASH DEPOSITS IN BANK ACCOUNT; LD. CIT(A) HOWEVER, OVERLOOKING THESE FACTS ALLOWED RELIEF TO THE ASSESSEE BY RELYING ONLY ON THE VERSION STATED BY THE ASSESSEE. 3. BRIEF FACTS ARE THAT THE ASSESSEE IS ENGAGED IN THE BUSINESS OF SUPPLY OF RODI, RETI ETC. HE FILED RETURN OF INCOME DECLARING TOTAL INCOME OF RS.2,50,200/ - AND AGRICULTURE INCOME OF RS.1,54,900/ - . THE AO RECEIVED INFORMATION THAT THE APPELLANT MADE CASH DE POSITS IN THE HDFC BANK, BAHADURGARH, DURING THE YEAR UNDER CONSIDERATION AND THE SOURCES FOR CASH DEPOSITS ALONG WITH OTHER INFORMATION WAS CALLED FROM THE APPELLANT MANY A TIMES. AS NO EXPLANATION WAS APPELLANT BY : SH. B.R.R. KUMAR, SR. DR RESPONDENT BY : NAVIN GUPTA, ADV PAGE 2 OF 3 FURNISHED FOR THE CASH DEPOSITS, THE AO COMPLETED THE ASSESSMENT TO HIS BEST JUDGEMENT U/S 144 OF THE ACT AS UNDER. 4. BEFORE THE LD CIT(A) THE ASSESSEE SOUGHT ADMISSION OF ADDITIONAL EVIDENCE OF PRODUCTION OF BOOKS OF ACCOUNTS FOR WHICH, REMAND REPORT WAS OBTAINED FROM THE AO, WHO IN THE SAID REPORT STATE D THAT SUCH BOOKS OF ACCOUNTS CANNOT BE RELIED UPON. IT WAS STATED THAT THE PLEA OF THE ASSESSEE IS A CONCOCTED STORY AS ASSESSEE NEITHER PRODUCED ANY BILLS NOR ANY SALES/ PURCHASE VOUCHERS IN RESPECT OF TRADING OF SUPPLIES IN RESPECT OF BUILDING MATERIAL. THE LD CIT(A) HELD AS UNDER: - IT IS WELL KNOWN THAT IN THE LINE OF BUSINESS OF SUPPLY OF RODI, RETI ETC. NO BILLS/INVOICES ARE ISSUED AND GENERALLY ALL THE TRANSACTIONS ARE IN CASH ONLY. THERE IS GENUINE APPREHENSION AS TO HOW THE APPELLANT COULD HAVE MA DE CASH DEPOSITS IN THE BANK OF RS 19,60,000/ - WHEREAS THE SALES ARE ONLY RS.9,11,128/ - . IT WAS EXPLAINED THAT THE APPELLANT WITHDREW CASH FOR MAKING PAYMENTS TO THE SUPPLIER/HIS AGENT AND WHEN THEY DID NOT TURN UP ON THE APPOINTED DATE, THE AMOUNT WAS RE - DEPOSITED IN THE BANK A/C AND SUBSEQUENTLY WITHDRAWN WHENEVER THE PAYMENT IS MADE. THE EXPLANATION GIVEN BY THE APPELLANT IN THE TABLE IN PARA 6 ABOVE IS PLAUSIBLE AND THEREFORE ACCEPTABLE IN VIEW OF THE PECULIAR FACTS OF THE CASE. IT IS FURTHER TO BE NOTE D THAT THE APPELLANT HAS DECLARED PROFIT OF RS 2,96,188/ - ON DECLARED SALES OF ONLY RS 9,11,128/ - . IN VIEW OF THE ABOVE, THERE IS NO REASON TO DISBELIEVE THE VERSION OF THE APPELLANT HAVING REGARD TO THE FACTS AND CIRCUMSTANCES OF THE CA.SE, AS MENTIONED A BOVE. THE ADDITION MADE BY THE AO IS THEREFORE DELETED AND THE GROUNDS OF APPEAL ARE ALLOWED. 5. BEFORE US, THE LD DR SUBMITTED THAT THE LD CIT(A), HAS RECORDED CONTRADICTORY FINDINGS. ON ONE HAND HE HOLDS THAT THERE IS GENUINE APPREHENSION THAT THE ASS ESSEE COULD HAVE MADE CASH - DEPOSITS TO THE TUNE OF RS.19.60 LACS, WHEREAS THE SALES ARE OF ONLY OF RS.9,11,128/ - . AND ON THE OTHER HAND HE HOLD THAT THERE IS NO REASON TO DISBELIEVE THE VERSION OF THE ASSESSEE. MOREOVER, HE POINTED OUT THAT NO EVIDENCE WAS LED BY THE ASSESSEE TO SUPPORT THE CLAIM OF SUPPLIES OF BUILDING MATERIAL VIS - A - VIS THE DEPOSIT IN THE BANK ACCOUNT. HE THEREFORE PRAYED THAT THE ADDITION BE RESTORED. ON THE OTHER HAND, THE LD AR SUBMITTED THAT THE ENTIRE CREDITS IN THE BANK ACCOUNT HAS BEEN ADDED BY THE AO, WITHOUT LOOKING AT THE WITHDRAWAL MADE BY THE ASSESSEE. HE SUBMITTED THAT THE LD CIT(A) WAS JUSTIFIED IS DELETING THE ADDITIONS AS IN THE LINE OF THE BUSINESS OF ASSESSEE, IT IS NOT PRACTICAL TO MAINTAIN BILLS FOR PURCHASE OF BUILDING MATERIAL LIKE SAND ETC . PAGE 3 OF 3 6. WE HAVE CAREFULLY CONSIDERED THE SUBMISSIONS OF BOTH THE SIDES AND PERUSED THE RECORDS. WE FIND THAT THE AO IN HIS ORDER HAS NOTED AND HELD THAT DURING THE YEAR UNDER CONSIDERATION, THE ASSESSEE DERIVES INCOME FROM TRADING OF BU ILDING MATERIAL AND HAS SHOWN GROSS SALES AT RS.9,11,128/ - , NET PROFIT OF RS.2,96,188/ - AND DECLARED NET TAXABLE INCOME AT RS.2,50,200 / - . 7. HE FURTHER ALSO ASSESSED THE SUM OF RS.2,50,200/ - AS INCOME OF THE ASSESSEE. APART THERE FROM HE HAS SEPARATELY BROUGHT TO TAX RS.19,60,200/ - ON ACCOUNT OF UN - EXPLAINED CASH DEPOSIT. WE FIND THAT SUCH AN ADDITION IS ERRONEOUS. THE AO OUGHT TO HAVE IN THE ABSENCE OF ANY OTHER MATERIAL, GRANTED THE BENEFIT OF SALES DECLARED BY THE ASSESSEE, WHEN HE HAS ACCEPTED THE FACT THE ASSESSEE IS IN THE BUSINESS OF TRADING OF BUILDING MATERIALS. FURTHER MORE HE OUGHT TO HAVE CONSIDERED THE WITHDRAWAL MADE BY THE ASSESSEE RATHER THAN BRINGING TO TAX THE ENTIRE DEPOSIT. FURTHERMORE THE LD CIT(A) HAS ALSO NOT CONSI DERED THE ABOVE FACTUAL ASPECTS, BUT HAS PROCEEDED TO DELETE THE ADDITION ON GENERALITIES AND PROBABILITIES, WHICH ARE OUTSIDE THE REALM OF LAW AND HENCE CANNOT BE COUNTENANCED. THEREFORE WE ARE INCLINED TO SET ASIDE THE IMPUGNED ORDER AND REMIT THE ISSUE BACK TO THE FILE OF THE AO, TO RE - EXAMINE THE ADDITION MADE IN THE LIGHT OF THE OBSERVATION MADE ABOVE. 8. IN THE RESULT THE APPEAL IS ALLOW FOR STATISTICAL PURPOSE. ORDER PRONOUNCED IN THE OPEN COURT ON 16 . 01 .201 5 . - SD/ - - SD/ - ( N.K.SAINI ) (A. T. VARKEY) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 16 / 01 / 201 5 A K KEOT COPY FORWARDED TO 1. APPLICANT 2. RESPONDENT 3. CIT 4. CIT (A) 5. DR:ITAT ASSISTANT REGISTRAR ITAT, NEW DELHI