Appeal details
Counselvise Citation
[2018] 118 COUNSELVISE.COM (IT) 2320 (ITAT-SURAT)
Assessee PAN
Bench
Appeal Number
Duration Of Justice
2 year(s) 6 month(s) 19 day(s)
Appellant
Respondent
Appeal Type
Income Tax Appeal
Pronouncement Date
25-05-2018
Appeal Filed By
Department
Order Result
Partly Allowed
Bench Allotted
DB
Assessment Year
2011-2012
Appeal Filed On
06-11-2015
Judgement Text
ITO -2(3)(6) SURAT V. KAMLESH KANTILAL PATEL /I.T.A. NO.3144 & CO.NO. 209/AHD/2015/A.Y.:11-12 PAGE 1 OF 12 , , IN THE INCOME TAX APPELLATE TRIBUNAL SURAT BENCH, SURAT . . , . . , BEFORE SHRI C.M.GARG, JUDICIAL MEMBER AND SHRI O.P.MEENA, ACCOUNTANT MEMBER I.T.A NO. A Y: APPELLANT V . RESPONDENT 3144/AHD/ 2015 2011 - 12 INCOME TAX OFFICER, WARD- 3(2)(6) SURAT SHRI KAMLESH KANTILAL PATEL KHUNO STREET BHESAN TAL-CHORYASI DISTRICT SURAT PAN:AIGPP 1553 R CO. NO. 209/AHD/2 015 2011 - 12 SHRI KAMLESH KANTILAL PATEL KHUNO STREET BHESAN TAL- CHORYASI DISTRICT SURAT PAN:AIGPP 1553 R INCOME TAX OFFICER, WARD- 3(2)(6) SURAT /ASSESSEE BY SHRI RAJESH M. UPADHAYAY, A.R. /REVENUE BY MS. ILLA P ARMAR , JCIT, SR. D.R. / DATE OF HEARING: 25 .05.2018 /PRONOUNCEMENT ON 28 .05.2018 /O R D E R PER O. P. MEENA, ACCOUTANT MEMBER: 1. THIS APPEAL BY THE REVENUE AND CROSS OBJECTION BY THE ASSESSEE ARE DIRECTED AGAINST THE ORDER OF LEARNED COMMISSIONER OF INCOME TAX (APPEALS)-1, SURAT (IN SHORT THE CIT (A)) DATED 03.08.2015 PERTAINING TO ASSESSMENT YEAR 2011-12, WHICH IN TURN HAS ARISEN FROM THE ORDER PASSED BY THE INCOME TAX OFFICER, ITO -2(3)(6) SURAT V. KAMLESH KANTILAL PATEL /I.T.A. NO.3144 & CO.NO. 209/AHD/2015/A.Y.:11-12 PAGE 2 OF 12 WARD- 6(2) SURAT (IN SHORT THE AO) DATED 21.03.2014 UNDER SECTION 143 (3) READ WITH SECTION 147 OF INCOME TAX ACT,1961 (IN SHORT THE ACT). I.T.A. NO. 3144/AHD/2015 BY REVENUE AND CO NO. 209 /AHD/2015 BY THE ASSESSEE: 2. GROUND NO. 1 TO 7 OF THE REVENUE STATES THAT THE LD. CIT (A) ERRED IN RESTRICTING ADDITION TO RS. 8,60,052 AS AGAINST RS. 79,67,000 MADE ON ACCOUNT OF UNEXPLAINED CASH CREDIT UNDER SECTION 68 OF THE ACT BY ACCEPTING THE CLAIM OF CASH DEPOSIT AS CONTRACT RECEIPTS AND THEREBY ESTIMATING ADDITION BY GROSS PROFIT AND INITIAL INVESTMENT WITHOUT APPRECIATING THAT THE ASSESSEE HAS CLAIMED THAT BANK ACCOUNT DEPOSITS WERE OUT OF AGRICULTURAL AND ANIMAL HUSBANDRY INCOME OF FAMILY, CONSTRUCTION WORK, LOAN AND SALE OF CAR WHICH HAS NOT BEEN PROVED. THEREFORE, CIT (A) SHOULD HAVE DIRECTED THE AO TO INITIATE PENALTY PROCEEDINGS UNDER SECTION 271B WHEN HE HAS HELD THAT ALL THE DEPOSITS ARE CONTRACT RECEIPTS IN VIEW OF THE PROVISIONS OF SECTION 44AB OF THE ACT. GROUND NO 1 TO 3 RAISED IN CROSS OBJECTION BY THE ASSESSEE IS AGAINST THE CONFIRMATION ITO -2(3)(6) SURAT V. KAMLESH KANTILAL PATEL /I.T.A. NO.3144 & CO.NO. 209/AHD/2015/A.Y.:11-12 PAGE 3 OF 12 OF ADDITION OF RS. 8,60,052. AND ADDITION MADE UNDER SECTION 68 OF THE ACT. HENCE, ISSUE OF CROSS OBJECTION AND APPEAL OF REVENUE ARE SAME HENCE, SAME ARE BEING CONSIDERED TOGETHER FOR SAKE OF CONVINCE AND BREVITY. 3. SUCCINCT FACTS ARE THAT THE ASSESSEE HAS OFFERED INCOME AT RS.2,72,500 BEING NP @ 11.60% OF CONSTRUCTION RECEIPTS AT RS. 23,50,650 UNDER PROVISIONS OF SECTION 44AD OF THE ACT . THE AO NOTICED THAT THE ASSESSEE HAS NOT DISCLOSED BANK ACCOUNT NO. 10/10629 MAINTAINED WITH SURAT DISTRICT CO-OPERATIVE BANK LTD. OLPAD, IN WHICH TOTAL DEPOSITS WERE NOTICED AT RS. 80,01,900 WHICH INTER-ALIA INCLUDED CASH DEPOSIT OF RS.79,67,000 AND CHEQUE DEPOSIT OF RS. 8,06,000. RS. 4 LAKH IN BANK ACCOUNT NO. 5078 WITH SURAT DISTRICT CO-OPERATIVE BANK LTD. NAVYUG, AND RS. 5.80 LAKH WITH BANK ACCOUNT NO.10022001020494 WITH PRIME CO-OPERATIVE BANK, ADAJAN. THE SOURCE OF CASH DEPOSIT WAS STATED TO BE OUT OF LOAN ABOUT RS. 22 LAKH FROM HIS UNCLE SHRI MANUBHAI LALLUBHAI PATEL, RS.8-10 LAKH FROM AGRICULTURAL INCOME OF THE FAMILY, RS.2-3 LAKH INCOME FROM ANIMAL HUSBANDRY, AND RS. 6.50 LAKH FROM SALE OF OLD CAR. HOWEVER, THE AO NOTED THE SHRI MANUBHAI PATEL WAS EXPIRED ON 08.12.2008 HENCE, CASH DEPOSIT FROM HIM IS NOT POSSIBLE ITO -2(3)(6) SURAT V. KAMLESH KANTILAL PATEL /I.T.A. NO.3144 & CO.NO. 209/AHD/2015/A.Y.:11-12 PAGE 4 OF 12 NOR ANY DOCUMENTARY EVIDENCE IN SUPPORT OF OPENING BALANCE OF RS. 22 LAKH IN THE ACCOUNT OF SHRI NATVARLAL PATEL HAS BEEN FILED. FURTHER, THE EVIDENCE OF 7/12 OF AGRICULTURAL LAND HOLDING IS ONLY 2.98 HECTARES OF WHICH MORE THAN 15 PERSONS ARE CO-OWNERS AND NO DETAILS OF LAND HOLDING BY SHRI NATVARBHAI PATEL NOT FILED HENCE, NOR 7/12 AND AGRICULTURAL INCOME BILLS PERTAINS TO THE ASSESSEE, SUCH CLAIM OF AGRICULTURAL INCOME IS NOT PROVED. FURTHER, CONSTRUCTION INCOME IS ONLY SHOWN AT RS.2,72,500 AND OTHER INCOME IS SHOWN AND NO INCOME OF ANIMAL HUSBANDRY HAS BEEN SHOWN. FURTHER, THE PURCHASER OF CAR HAS STATED THAT ONLY RS. 3.20 LAKH WERE GIVEN FOR PURCHASE OF CAR IN F.Y. 2012-13 , HENCE, SUCH EXPLANATION OF THE ASSESSEE WAS FOUND TO BE FALSE. THEREFORE, THE ENTIRE CASH DEPOSITS OF RS. 79,67,000 INCLUDING CHEQUE DEPOSITS WE TREATED AS UNEXPLAINED AND ADDED TO TOTAL INCOME. 4. BEING AGGRIEVED, THE ASSESSEE FILED AN APPEAL BEFORE THE LD. CIT (A). THE CIT (A) OBSERVED THAT IT EVIDENT FROM RETURN OF INCOME THAT THE ASSESSEE WAS ENGAGED IN CONSTRUCTION BUSINESS. THE CIT (A) NOTED THAT THE AO CONSIDERED CASH WITHDRAWALS OF RS. 8 LAKH FROM BANK ACCOUNT AS AGAINST ACTUAL CASH WITHDRAWALS OF RS. 16,20,000 OUT OF WHICH CASH DEPOSIT OF RS. 8 LAKH WERE MADE IN BANK ACCOUNT NO. 5078, BUT ACTUAL CASH DEPOSIT IN SAID BANK ITO -2(3)(6) SURAT V. KAMLESH KANTILAL PATEL /I.T.A. NO.3144 & CO.NO. 209/AHD/2015/A.Y.:11-12 PAGE 5 OF 12 ACCOUNT NO. IS ONLY RS. 4 LAKHS , HENCE, CASH OF RS. 12,20,000 [ 16,20,000- 4,00,000] WAS AVAILABLE WITH THE ASSESSEE. HENCE, ONLY RS. 67,47,000 [ 79,67,000- 12,20,000] ARE ONLY REQUIRED TO BE EXPLAINED. FURTHER THE CLAIM OF RS. 53.32 LAKH RECEIVED FROM LATE UNCLE SHRI MANUBHAI PATEL IS NOT FOUND TO BE BELIEVABLE. THE MAJOR SOURCE OF THESE TRANSACTIONS IS CLAIMED TO BE FROM AGRICULTURAL INCOME AND RS. 22 LAKH AS OPENING CAPITAL BALANCE. BUT NONE OF THEM COULD BE PROVED. SIMILARLY IN THE STATEMENT RECORDED UNDER SECTION 131 OF THE ACT FROM THE ASSESSEE, IT HAS BEEN CLAIMED THAT RS. 8-10 LAKH AGRICULTURAL INCOME , RS. 2-3 LAKH ANIMAL HUSBANDRY INCOME. BUT NEITHER ANY EVIDENCE FILED NOR SUCH INCOME REFLECTED IN RETURN OF INCOME AND LAND HOLDING WAS IN JOINT NAME. SIMILARLY, RECEIPT OF RS. 6.50 LAKH CASH FROM SALE OF CAR IS ALSO FOUND TO BE AFTERTHOUGHT AS IT WAS CLAIMED THAT CASH WAS RECEIVED IN SEPTEMBER 2010 WHEREAS THE PURCHASER SHRI PRAKASH D THAKKAR STATED THAT CAR WAS PURCHASED IN F.Y. 2012-13 AND CAR WAS TRANSFERRED ON 14.02.2013. IN VIEW OF ABOVE, THE CIT (A) OBSERVED THAT CASH OF RS. 12.20 LAKH WAS AVAILABLE WITH THE ASSESSEE AND RS. 23,50,650 ARE SHOWN FROM CONSTRUCTION ACTIVITY AND THE AO HAS ALSO ASSESSED INCOME OF RS. 2,72,500 FROM CONSTRUCTION ACTIVITY WHILE PASSING ORDER. THEREFORE, THE CIT (A) OBSERVED THAT CREDIT OF RS. ITO -2(3)(6) SURAT V. KAMLESH KANTILAL PATEL /I.T.A. NO.3144 & CO.NO. 209/AHD/2015/A.Y.:11-12 PAGE 6 OF 12 23,50,650 IS TO BE ALLOWED OUT OF UNEXPLAINED RECEIPTS OF RS. 67,47,000. I.E. [79,67,000- 12,20,000]. THE ASSESSEE HAS SHOWN NET PROFIT AT RS.2,72,500 @11.60% ON DISCLOSED RECEIPTS OF RS. 23,50,600. IN VIEW OF THIS MATTER, THE CIT (A) HAS ESTIMATED CONSTRUCTION INCOME AT RS. 5,10,052 @11.60% OF RS. 43,97,000 ( RS. 67,47,000- 23,50,600) AND ALSO CONSIDERED INITIAL INVESTMENT OF RS. 3,50,000 BEING 1/12 TH OF CASH DEPOSIT OF RS. 43 97,000. THUS, THE CIT (A) APPEAL HAS CONFIRMED THE ADDITION OF RS.8,60,052 [ 5,10,052+ 3,50,000]. ACCORDINGLY CIT (A) HAS CONFIRMED ADDITION OF RS. 8,60,052 AND DELETED BALANCE ADDITION OF RS. 71,06,948[ 79,67,000- 8,60,052]. 5. BEING, AGGRIEVED THE REVENUE FILED THIS APPEAL BEFORE THE TRIBUNAL AGAINST THE DELETION OF ADDITION OF RS. 71,06,948 AND THE ASSESSEE HAS FILED CROSS OBJECTION AGAINST THE CONFIRMATION OF ADDITION OF RS. 8,60,052. 6. THE LD. SR. DR SUBMITTED THE CASE LAWS OF DINESHBHAI DHANSUKHBAHI MITHAIWALA AND JAYESH MEHTA ARE NOT RELEVANT AS IN THAT CASES THE ASSESSEE HAVE STATED THAT CASH DEPOSIT IN BANK ACCOUNT ARE ON ACCOUNT OF CASH SALES WHEREAS IN THE CASE OF THE ITO -2(3)(6) SURAT V. KAMLESH KANTILAL PATEL /I.T.A. NO.3144 & CO.NO. 209/AHD/2015/A.Y.:11-12 PAGE 7 OF 12 ASSESSEE THE SOURCE OF CASH DEPOSIT WAS CLAIMED ON ACCOUNT OF AGRICULTURAL INCOME OF RS. 8-10 LAKH , ANIMAL HUSBANDRY INCOME OF RS. 3-4 LAKH CONSTRUCTION BUSINESS RECEIPT OF RS. 10-15 LAKH , LOAN FROM SHRI MUKESHBHAI PATEL OF RS. 1.22 LAKH. HOWEVER, THE ASSESSEE COULD NOT PRODUCE ANY EVIDENCE IN SUPPORT OF HIS CLAIM OF SOURCES, WHEREAS THE CIT (A) HAS ACCEPTED THE SOURCE OF CASH DEPOSIT OUT OF CONTRACT RECEIPTS WHICH IS NOT FOUND CONVINCING. EVEN THOUGH THE ASSESSEE HAS NOT MADE ANY SUBMISSIONS. THEREFORE, IT IS NOT UNDERSTANDABLE AS HOW THE CIT (A) HAS HELD THE CASH DEPOSITS OUT OF CONTRACT RECEIPTS WHEN THE ASSESSEE HIMSELF CLAIMED THAT CASH DEPOSITS ARE OUT OF LOAN , AGRICULTURE, ANIMAL HUSBANDRY RECEIPTS. FURTHER WITHOUT PREJUDICE TO ABOVE , EVEN IF IT WAS HELD THAT CASH DEPOSITS ARE UNACCOUNTED RECEIPTS OF CONTRACT RECEIPTS THEN THE CIT (A) SHOULD HAVE DIRECTED THE AO TO INITIATE PENALTY PROCEEDINGS UNDER SECTION 271B CONSIDERING THE TURNOVER OF MORE THAN RS. 60 LAKHS FOR NOT GETTING THE BOOKS OF ACCOUNTS AUDITED IN VIEW OF PROVISIONS OF SECTION 44AB OF THE ACT. THE EXPLANATION OF LOAN WAS NOT FOUND ACCEPTABLE AS SHRI MANUBHAI PATEL WAS ALREADY EXPIRED ON 08.12.2008 AND NO SOURCE WAS PROVED OF AGRICULTURAL AND ANIMAL HUSBANDRY AND RECEIPT FROM SALE OF CAR. WITHOUT PREJUDICE TO ABOVE, THE LD. SR. DR FURTHER ITO -2(3)(6) SURAT V. KAMLESH KANTILAL PATEL /I.T.A. NO.3144 & CO.NO. 209/AHD/2015/A.Y.:11-12 PAGE 8 OF 12 SUBMITTED THAT THE CIT (A) SHOULD HAVE ESTIMATED THE INCOME OF THE ASSESSEE BY TAKING PEAK CREDIT THEORY CALCULATED AT RS. 47,58,000 INSTEAD ESTIMATING GROSS PROFIT ADDITION AND INITIAL INVESTMENT. 7. PER CONTRA, THE LD. AR SUBMITTED THAT THE ASSESSEE HAS NOT MAINTAINED ANY BOOKS OF ACCOUNTS AS THE RETURNED IS FILED UNDER SECTION 44AD OF THE ACT. THEREFORE, THE BANK ACCOUNT DEPOSITS COULD NOT BE ADDED UNDER SECTION 68 OF THE ACT. THE LD. A.R. ALSO RELIED IN THE CASE OF SHANTA DEVI V. CIT [1998] 171 ITR 532 (P&H) WHEREIN IT WAS HELD THE BOOKS OF ACCOUNTS OF PARTNERSHIP FIRM CANNOT BE TREATED AS BOOKS OF ACCOUNTS OF THE ASSESSEE INDIVIDUAL ASSESSEE. HOWEVER, WHEN ASKED BY THE BENCH THAT CIT (A) HAS UPHELD THE ADDITION ON ACCOUNT OF UNEXPLAINED INVESTMENT BY CONSIDERING INITIAL INVESTMENT AND GROSS PROFIT ADDITION AND CIT (A) HAS CO-TERMINUS POWER THAT OF THE AO, THE LD. AR COULD NOT CONTROVERT THIS FACT AND SUBMITTED THAT ONLY ONE ACCOUNT WAS UNDISCLOSED ONLY. 8. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE RELEVANT MATERIAL ON RECORD. WE FIND THAT THE ASSESSEE HAS MADE CASH DEPOSITS OF RS. 79,67,000 WITH BANK ACCOUNT NO. 10/10629 ITO -2(3)(6) SURAT V. KAMLESH KANTILAL PATEL /I.T.A. NO.3144 & CO.NO. 209/AHD/2015/A.Y.:11-12 PAGE 9 OF 12 WITH SURAT DISTRICT CO-OPERATIVE BANK LTD. DURING THE YEAR UNDER CONSIDERATION. THIS BANK ACCOUNT WAS NOT DISCLOSED IN THE RETURN OF INCOME. THE SOURCE OF CASH DEPOSITS ALONG WITH CHEQUE DEPOSITS IN THIS ACCOUNT WAS CLAIMED TO BE OUT OF LOAN RECEIPT, AGRICULTURAL INCOME, ANIMAL HUSBANDRY, SALE OF CAR. HOWEVER, THIS CLAIM HAS NOT BEEN SUBSTANTIATED WITH DOCUMENTARY EVIDENCE AND EVIDENCES SUBMITTED BY THE ASSESSEE WERE FOUND TO BE NOT TENABLE ON FACTS BY THE AO AS WELL AS CIT (A) NOR SUCH EVIDENCES ARE FOUND SUBSTANTIATED BEFORE US. WE OBSERVE THAT THE CIT (A) APPEAL HAS CONSIDERED CASH WITHDRAWALS FOR RS.12,20,000 AS EXPLAINED AND THEREFORE, ALLOWED SET-OFF AGAINST THE CASH DEPOSITS IN BANK ACCOUNT. HOWEVER, CIT (A) HAS CONSIDERED THE CASH DEPOSITS AS UNACCOUNTED CONTRACT RECEIPTS, EVEN THOUGH THE ASSESSEE HAS NOT MADE SUCH CLAIM DURING THE COURSE OF ASSESSMENT PROCEEDINGS OR DURING THE COURSE OF APPELLATE PROCEEDINGS. THEREFORE, WE ARE NOT PERSUADED WITH THE FINDING OF THE CIT (A). SINCE THE CASH DEPOSITS IN BANK ACCOUNT ARE NOT EXPLAINED, AS IT IS CLEARLY ESTABLISHED WITH THE FINDING OF THE AO AS WELL AS CIT (A). WE ALSO OBSERVE THAT OPENING CAPITAL BALANCE OF RS. 22 LAKH IN THE NAME OF LATE SHRI MANUBHAI PATEL AND ALSO CONFIRMATION FROM HIS SHRI NATVARLAL PATEL HIS SON HAS ALSO NOT PROVED THE SOURCE OF SUCH CAPITAL BALANCE ITO -2(3)(6) SURAT V. KAMLESH KANTILAL PATEL /I.T.A. NO.3144 & CO.NO. 209/AHD/2015/A.Y.:11-12 PAGE 10 OF 12 BROUGHT BY ANY DOCUMENTARY EVIDENCE. HENCE, THIS CLAIM OF THE ASSESSEE IS DEVOID OF ANY MERIT. THE CLAIM OF AGRICULTURAL INCOME IS ALSO NOT SUPPORTED BY DOCUMENTARY EVIDENCE AND THE COPY OF 7/12 AND BILLS ETC. PRODUCED WERE NOT IN THE NAME OF THE ASSESSEE. FURTHER, NO SUCH AGRICULTURAL INCOME IS SHOWN IN THE RETURN OF INCOME BY THE ASSESSEE. HENCE, THIS CLAIM IS ALSO NOT BEEN SUBSTANTIATED. NO EVIDENCE IS FILED IN SUPPORT OF ANIMAL HUSBANDRY INCOME. THE RECEIPT OF SALE OF CAR IS ALSO DENIED BY THE PURCHASER (SHRI P D THAKKAR) OF CAR WHO HAD FILED EVIDENCES THAT ONLY RS. 3,20,000 IN CASH WAS GIVEN DURING F.Y. 2012-13 WHICH IS ALSO SHOWN BY HIM IN HIS RETURN OF INCOME FOR THE RELEVANT ASSESSMENT YEAR. IN VIEW OF THIS MATTER, THE SOURCE OF CASH DEPOSITS IN BOOKS IS NOT PROVED. WE ALSO FIND THAT CIT (A) HAS WRONGLY TREATED THESE CASH DEPOSITS AS PART OF CONTRACT RECEIPTS WHEN NO SUCH CLAIM IS MADE. IN VIEW OF THIS MATTER, WE HELD THE CASH DEPOSITS AS UNEXPLAINED. THEREFORE, IS SUCH A SITUATION, IT WOULD NOT BE JUSTIFIABLE IF THE ENTIRE CASH DEPOSITS ARE CONSIDERED AS UNEXPLAINED AS THERE ARE CASH WITHDRAWALS ALSO AND RECIRCULATION OF CASH DEPOSITS IN SAID ACCOUNT. ON PERUSAL OF BANK ACCOUNT NO. 10/10629 WITH SURAT DISTRICT CO-OPERATIVE BANK LTD., PLACED AT PAPER BOOK PAGE NO. 42 TO 46, WE FIND THE MAXIM PEAK BALANCE IS AT RS. 13,11,741 (PB-44) ITO -2(3)(6) SURAT V. KAMLESH KANTILAL PATEL /I.T.A. NO.3144 & CO.NO. 209/AHD/2015/A.Y.:11-12 PAGE 11 OF 12 AS ON 05.10.2010 IN THE SAID ACCOUNT. FURTHER, THERE IS OPENING BALANCE OF RS. 1,583 AS ON 17.04.2010 (PB-42). THEREFORE, CONSIDERING THE TOTALITY OF FACTS IT WOULD BE REASONABLE TO RESTRICT THE ADDITION TO THIS MAXIM PEAK BALANCE AS ON 05.10.2010 PLUS OPENING BALANCE BROUGHT FORWARD OF RS. 1,583 AGGREGATING TO RS. 13,13,324 [ 13,11,741+ 1,583] AS AGAINST THE TOTAL ADDITION OF RS. 79,67,000 MADE BY THE AO AND ADDITION OF RS. 8,60,052 SUSTAINED BY THE CIT (A). SINCE, THE CIT (A) HAS CONSIDERED THE ADDITION ON THE BASIS OF UNACCOUNTED INVESTMENT, THEREFORE, THE CASE LAWS RELIED BY THE LD. A.R. OF THE ASSESSEE THAT NO ADDITION CAN BE MADE UNDER SECTION 68 IS NOT RELEVANT AS THE CIT (A) HAS CO-TERMINUS POWER AS THAT OF THE AO. FURTHER, WE HAVE ALSO FIND THAT ADDITION BE MADE AS UNEXPLAINED INVESTMENT. THEREFORE, WE ARE NOT DISCUSSING THE CASE LAWS RELIED BY THE LD. A.R. SO FAR GROUND OF REVENUE IS CONCERNED THAT CIT (A) SHOULD HAVE DIRECTED FOR INITIATION OF PENALTY PROCEEDINGS UNDER SECTION 271B BY CONSIDERING THE CASH DEPOSITS AS TURNOVER. AS WE HAVE HELD THAT CIT (A) WAS WRONG IN CONSIDERING THE CASH DEPOSITS AS PART OF TURNOVER, HENCE, THIS GROUND OF THE REVENUE FAILS. WE MAY ALSO MAKE IT CLEAR THAT IT IS FOR THE AO OR COMPETENT AUTHORITY WHO CAN INITIATE PENALTY PROCEEDINGS AND NOT BY THE CIT (A) IF THEY FOUND IF THERE IS ANY ITO -2(3)(6) SURAT V. KAMLESH KANTILAL PATEL /I.T.A. NO.3144 & CO.NO. 209/AHD/2015/A.Y.:11-12 PAGE 12 OF 12 VIOLATION OF LAW. THEREFORE, IN VIEW OF THESE FACTS AND CIRCUMSTANCES, THE REVENUE GROUNDS NO 1 TO 7 OF APPEALS ARE PARTLY ALLOWED BY SUSTAINING ADDITION OF RS. 13,13,324 AND ASSESSEE GROUND NO 1 TO 3 OF APPEAL IN CROSS OBJECTION IS THEREFORE, DISMISSED. 9. IN THE RESULT, THE APPEAL OF THE REVENUE IS PARTLY ALLOWED AND CROSS OBJECTION OF THE ASSESSEE IS DISMISSED. 10. THE ORDER PRONOUNCED IN THE OPEN COURT ON 28.05.2018 SD/- SD/- ( . . ) /(C.M. GARG) ( . . ) /(O.P.MEENA) /JUDICIAL MEMBER / ACCOUNTANT MEMBER / SURAT: / DATED : 28 MAY, 2018/OPM COPY SENT TO- ASSESSEE/AO/PR. CIT/ CIT (A)/ ITAT (DR)/GUARD FILE OF ITAT. BY ORDER / / TRUE COPY / / ASSISTANT REGISTRAR, SURAT
