Shri Hitesh Rasiklal Upadhyay, Baroda V. Income Tax Officer, Ward-2(1), Baroda

ITA 3109/AHD/2014

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 5097 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 8 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 01-08-2018
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: D
• Assessment Year: 2008-2009
• Appeal Filed On: 24-11-2014
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: V K SINGH
• Assessee Lawyers: STUTI TRIVEDI
• Keywords: Unexplained cash credit
• Section: 148

Judgement Text

, - IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCH D BEFORE SHRI RAJPAL YADAV, JUDICIAL MEMBER AND SHRI AMARJIT SINGH, ACCOUNTANT MEMBER ./ ITA NO. 3109/AHD/2014 / ASSESSMENT YEAR: 2008-2009 SHRI HITESH RASIKLAL UPADHYAY BRAHMIN FALIYA DASHRATH, BARODA 391 740. PAN : AANUPU 6131 D VS ITO, WARD-2(1) BARODA. / (APPELLANT) / (RESPONDENT) ASSESSEE BY : MS.STUTI TRIVEDI, AR REVENUE BY : SHRI V.K. SINGH, SR.DR / DATE OF HEARING : 13/07/2018 /DATE OF PRONOUNCEMENT : 01/08/2018 O R D E R PER RAJPAL YADAV, JUDICIAL MEMBER : ASSESSEE IS IN APPEAL BEFORE THE TRIBUNAL AGAINST ORDER OF LD.CIT(A)-II, BARODA PASSED FOR THE ASSTT.YEAR 2008-09. 2. GROUNDS OF APPEAL TAKEN BY THE ASSESSEE ARE NOT IN CONSONANCE WITH THE RULE 8 OF THE INCOME TAX (APPELLATE TRIBUNAL) RULES , 1963 - THEY ARE DESCRIPTIVE AND ARGUMENTATIVE IN NATURE. IN BRIEF THE GRIEVANCE OF THE ASSESSEE IS THAT THE LD.CIT(A) HAS ERRED IN CONFIRMING ACTIO N OF THE AO FOR TAKING GROSS RECEIPTS OF RS.6,71,719/- INSTEAD OF RS.5,04,200/- AND ALSO ERRED IN CONFIRMING ADDITION OF RS.2,84,000/-. 3. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE DI D NOT FILE HIS RETURN OF INCOME UNDER SECTION 139(1) OF THE ACT. A NOTICE U NDER SECTION 148 WAS ISSUED ITA NO.3109/AHD/2014 - 2 - AND SERVED UPON THE ASSESSEE. HE FILED HIS RETURN OF INCOME ON 25.6.2013 DECLARING INCOME AT RS.1,26,050/-. THIS INCOME WAS DISCLOSED AT 25% OF GROSS SALE OF RS.5,04,200/-. ON SCRUTINY OF THE DETAILS, IT REVEALED TO THE AO THAT FOR THE PURPOSE OF VAT RETURN, THE ASSESSEE HAS SHOWN T URNOVER OF RS.6,98,746/-. THUS, HE WAS OF THE VIEW THAT 25% OF NET PROFIT OUG HT TO HAVE BEEN SHOWN ON THE VAT TURNOVER OF RS.6,98,746/-. APART FROM ABOV E, THE LD.AO FOUND THAT THE ASSESSEE HAS MADE CASH DEPOSITS OF RS.2,84,000/-. HE TREATED SUCH CASH DEPOSITS AS UNEXPLAINED CASH CREDIT AND MADE ADDITION. ON A PPEAL, THE LD.CIT(A) HAS CONFIRMED THE ADDITION BY OBSERVING AS UNDER: 3.3.1. I HAVE CONSIDERED THE SUBMISSIONS OF THE LE ARNED AUTHORIZED REPRESENTATIVE AND THE ORDER OF THE ASSESSING OFFIC ER. THERE IS NO DISPUTE BY THE APPELLANT ABOUT THE FACT THAT DURING THE COU RSE OF ASSESSMENT PROCEEDINGS, THE ASSESSEE HAS DISCLOSED INCOME BY S HOWING 25% NET PROFIT ON SALE OF RS.5,04,200/- WHEREAS AS PER THE VAT RETURN, THE TURNOVER OF RS.6,98,746/- HAS BEEN DISCLOSED. AS PE R THE SUBMISSIONS FILED BEFORE ME, THIS INCLUDES TRANSPORTATION + VAT + CST TOTALING TO RS.27,027/-. THE ASSESSING OFFICER HAS CONTENDED TH AT DURING THE YEAR UNDER CONSIDERATION THE TURNOVER WAS RS.6,98,746/- AND NOT RS.5,04,200/- .HOWEVER, HE SHOULD HAVE TAKEN FIGURE OF RS.6,71,71 9/- AS CORRECT TURNOVER WHICH WAS CONSIDERED AT RS.6,98,746/-. THE NET PROFIT AT 25% WAS RIGHTLY ASSESSED BY THE ASSESSING OFFICER AND O N THE TURNOVER OF RS.6,71,719/-, IT WILL BE RS.1,67,930/- INSTEAD OF I.E. RS.1,74,690/-. THE ADDITION MADE BY THE ASSESSING OFFICER AMOUNTING TO RS.1,74,690/- IS, THEREFORE, RESTRICTED TO RS.1,67,930/-. THE ASSESSE E SHALL GET RELIEF OF RS.6,760/-. 3.3.2. IN RESPECT OF SECOND ADDITION OF CREDITS IN THE BANK ACCOUNT, ASSESSING OFFICER HAS NOT CONSIDERED THE SUBMISSION S OF THE APPELLANT THAT SEVERAL SALES WERE MADE IN CASH AND THE RECEIP TS WERE DEPOSITED IN BANK ACCOUNTS. LD. AUTHORIZED REPRESENTATIVE HAS CO NTENDED BEFORE ME THAT THE ASSESSING OFFICER DID NOT GIVE HIM SUFFICI ENT TIME TO EXPLAIN HIS CASE. THE SAME DOES NOT APPEAR TO BE CORRECT. MOREO VER, BEFORE ME ALSO, NO PLAUSIBLE EXPLANATION HAS BEEN FURNISHED BESIDES FILING INCOMPLETE PHOTOCOPIES OF THE TWO BANK ACCOUNTS THAT TOO WITHO UT ANY NARRATION/CONFIRMATION REGARDING CASH SALES. IN ABS ENCE OF ANY EVIDENCE TO SUPPORT THE CLAIM OF THE APPELLANT, I AM NOT INC LINED TO INTERFERE IN THE ITA NO.3109/AHD/2014 - 3 - ORDER OF THE ASSESSING OFFICER AND THE ADDITION OF RS.2,84,000/- IS CONFIRMED. THIS GROUND OF APPEAL FAILS. 4. WITH THE ASSISTANCE OF THE LD.REPRESENTATIVE, WE HAVE GONE THROUGH THE RECORD. AS FAR AS FIRST FOLD OF GRIEVANCE OF THE A SSESSEE IS CONCERNED, WE DO NOT FIND ANY MERIT IN IT. THE REVENUE AUTHORITIES HAVE TAKEN TURNOVER OF THE ASSESSEE AT RS.6,71,719/- INSTEAD OF RS.5,04,200/- DISCLOSED BY HIM ON THE BASIS OF VAT RETURN. THERE WAS NO ERROR IN THIS FIGURE O F TURNOVER. ONCE THE ASSESSEE HAS ADMITTED THAT THIS ACCOUNT HAS BEEN USED BY THE ASSESSEE FOR THE PURPOSE OF BUSINESS AND SALE PROCEEDS WERE BEING DEPOSITED IN THIS ACCOUNT; SIMILARLY FOR MAKING PURCHASES, AMOUNTS HAVE BEEN WITHDRAWN, THEN UNLESS HE DEMONSTRATED WITH HELP OF SOME TANGIBLE EVIDENCE THAT SUM OF RS. 1,44,349/- WAS A CREDIT LOAN AND DEPOSITED IN THIS ACCOUNT, THIS CREDIT LOAN MUS T HAVE BEEN USED FOR THE PURPOSE OF BUSINESS ONLY. HENCE, THE LD.AO HAS RIG HTLY TAKEN THE TURNOVER ON THE BASIS OF VAT RETURN. SO FAR AS SECOND FOLD OF GRIEVANCE IS CONCERNED, T HE ADDITION OF RS.2,84,000/-, THE ASSESSEE HAS SPECIFICALLY PLEADE D THAT ALL CASH DEPOSITS IN THIS ACCOUNT REPRESENTED SALE PROCEEDS. ONCE THE AO HAS ACCEPTED THE ACCOUNT, ITS USE FOR THE PURPOSE OF BUSINESS AND ACCEPTED THE TR EATMENT OF ASSESSABLE INCOME AT 25% NET PROFIT OF THE DEPOSITS, THEN, HE SHOULD HAVE NOT SEGREGATED CERTAIN AMOUNTS FOR TREATING THEM AS UNEXPLAINED CASH CREDI T. WE ALLOW THIS GROUND OF APPEAL AND DELETE THE ADDITION OF RS.2,84,000/-. I N THIS WAY, THE APPEAL OF THE ASSESSEE IS PARTLY ALLOWED. 5. IN THE RESULT, APPEAL OF THE ASSESSEE IS PARTLY ALLOWED. PRONOUNCED IN THE OPEN COURT ON 1 ST AUGUST, 2018. SD/- SD/- (AMARJIT SINGH) ACCOUNTANT MEMBER (RAJPAL YADAV) JUDICIAL MEMBER AHMEDABAD; DATED, 01/08/2018