Shubhangi Sudhir Zagade, Raigad V. Income-Tax Officer, Ward-1, Panvel

ITA 321/PUN/2021

AI Insights

The case involves Shubhangi Sudhir Zagade, who appealed against the order of the Commissioner of Income Tax (Appeals) confirming the addition of Rs. 49,24,935 to her income for the Assessment Year 2017-18. This amount was deposited in her bank account during the demonetization period. The primary contention was whether these deposits could be assessed under section 69A of the Income Tax Act, 1961, and whether the higher tax rate under section 115BBE was applicable. The Tribunal found that the assessee failed to provide sufficient documentary evidence to support her claim that the deposits were related to her partnership firm, Shubham Gas Services, and not her personal income. Consequently, the Tribunal dismissed the appeal, upholding the lower authorities' decisions.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 134313 (ITAT-PUNE)
• Duration Of Justice: 1 year(s) 6 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-02-2023
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 21-12-2022
• Assessment Year: 2017-2018
• Appeal Filed On: 08-08-2021
• Laws Referred To: Income Tax Act, 1961, Reserve Bank of India Act, 1934
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Set aside
• Section: 69C; 143(3); 69A

Judgement Text

आयकर अपीलीय अिधकरण “बी” Ɋायपीठ पुणेमŐ। IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCHES “B” :: PUNE BEFORE SHRI S.S.GODARA, JUDICIAL MEMBER AND DR. DIPAK P. RIPOTE, ACCOUNTANT MEMBER आयकर अपील सं. / ITA No.321/PUN/2021 िनधाᭅरण वषᭅ / Assessment Year : 2017-18 Shubhangi Sudhiar Zagade, M/s.Shubham Gas Services, Ambawade, Tal. Roha, Raigad – 402304. PAN: AACPZ 9826 H V s The Income Tax Officer, Ward-1, Panvel. Appellant/ Assessee Respondent / Revenue Assessee by Shri M.M.Kulkarani – AR Revenue by Shri M.G.Jasnani – DR Date of hearing 22/12/2022 Date of pronouncement 28/02/2023 आदेश/ ORDER PER DR. DIPAK P. RIPOTE, AM: This appeal filed by the Assessee is directed against the order of ld.Commissioner of Income Tax(Appeal)[NFAC], Delhi dated 19.07.2021 emanating from the assessment order dated 06.12.2019 under section 143(3) of the I.T.Act, 1961 for the A.Y.2017-18. The Assessee has raised the following grounds of appeal: “1. On the facts and in the circumstances of the case and in law the NFAC Delhi was not justified in rejecting the claim of the appellant- assessee that deposits made in the saving bank account during Demonetization period is liable to be assessed in the hands of the assessee u/s 69A of the Act. The addition be deleted. 2. On the facts and in the circumstances of the case and in law the NFAC did not go to the detailed submissions made before it. The reliance was placed on the amended provisions of S. 26 and 39 of the ITA No.321/PUN/2021 Shubhangi Sudhir Zagade [A] 2 Reserve Bank of India Act, 1934. The NFAC has not gone through these amended provisions or else it followed would not have confirmed the addition. 3. On the facts and in the circumstances of the case and in law it appears the authority was not aware of any such legal position. The old currency deposited in "Know Your Customer Compliant Bank Account" within the period specified in the notification was considered as legal tender even in 'demonetization period'. The deposits made by the assessee in "Know Your Customer Compliant Bank Account" could not have been added u/s 69A of the Act. It be deleted. 4. On the facts and in the circumstances of the case and in law it was explained orally and in written submission that addition made of Rs.49,24,935/- u/s 69A belonged to firm in which this assessee was a partner from 01-4-2016. This turnover is also included in the books of the firm. This amounts to double addition of the same amount once in the hands of this assessee and also in the Firm's account. The double addition of the same amount is impermissible in law. It be deleted. 5. On the facts and in the circumstances of the case and in law the NFAC was not justified in confirming the applicability of S. 115BBE of the Act to tax the income @60% being higher rate. The rate of 60% was increased from 30% to 60% from 15-12- 2016 and not applicable for the year under appeal. In fact and law S. 115BBE is not applicable to the facts of this case as it cannot be applied retrospectively. It be held accordingly. 6. On the facts and in the circumstances of the case and in law the interest under S. 234A/234B and 234C was not leivable as such as no addition was liable to be made of Rs. 49,24,395/- as made by A. O. The case laws including Full bench judgment of the Ranchi Bench in Patna High Court was relied upon NFAC. The same is ignored by the Authority. The interest be deleted. 7. On the facts and in the circumstances of the case and in law and since the same income has been assessed in the hands of the Firm. M/s Shubham Gas Services this assessment is not sustainable in law. The assessment itself be quashed and set aside. 8. The appellant craves to leave, add/amend or alter any of th above grounds of appeal.” Brief facts of the case : 2. The assessee had filed Return of Income for A.Y.2017-18 on 28.03.2018 declaring total income at Rs.12,89,240/-. The case of the ITA No.321/PUN/2021 Shubhangi Sudhir Zagade [A] 3 assessee was selected for scrutiny to verify cash deposits during the demonetization period. The Assessing Officer(AO) issued various notices but assessee failed to file any submission before the AO. The AO observed that assessee has deposited cash of Rs.49,24,935/- during the period 09.11.2016 to 31.12.2016 in the State Bank of India Account No.35615237751, Kolad Branch. Since assessee failed to file any explanation even after giving repeated notice and final show cause notice, the AO added Rs.49,24,935/- to the total income of the assessee. Aggrieved by the same, the assessee filed appeal before the ld.CIT(A). The ld.CIT(A) confirmed the addition. 3. Aggrieved by the order of the ld.CIT(A), the assessee filed appeal before this Tribunal. 4. The ld.Authorised Representative(ld.AR) for the Assessee filed paper book containing Return of Income for A.Y. 2017-18 of Shubhamn Gas Service, a partnership firm which was created on 01.04.2016 as claimed by the ld.AR. The ld.AR filed copy of Balance Sheet and Profit and Loss Account of the said Shubhamn Gas Service. The ld.AR submitted that assessee was doing business earlier as a proprietor but from 01.04.2016 assessee formed a partnership firm called Shubhamn Gas Service for the business of the assessee. The ld.AR pleaded that the cash deposit during the demonetization was pertaining to the assessee’s partnership firm ITA No.321/PUN/2021 Shubhangi Sudhir Zagade [A] 4 Shubham Gas Service. The ld.AR further pleaded that the assessee had requested the State Bank of India to change the PAN which was mentioned in the SBI Account No.35615237751 as assessee’s PAN was attached to the said account. 5. The ld.Departmental Representative(ld.DR) for the Revenue relied on the order of Lower Authorities. Findings & Discussions : 6. We have heard both the parties and perused the records. It is observed that there is no dispute on the issue of cash of Rs.49,24,935/- was deposited during the period from 09.11.2016 to 31.12.2016 in SBI Account No.35615237751 at Kolad Branch. The ld.AR has merely pleaded that said cash pertains to the assessee’s partnership business Shubham Gas Services. However, the ld.AR has not produced any document like cash book, audit report maintained by Shubham Gas Services to prove the cash deposits during the impugned period. The ld.AR failed to explain how the firm Shubham Gas Services has deposited its cash in the bank account of the assessee. Therefore, in these facts and circumstances, the claim of the assessee that cash deposited in the SBI Account No.35615237751, pertained to partnership firm is not supported by any documentary evidence, hence, not sustainable, therefore, we ITA No.321/PUN/2021 Shubhangi Sudhir Zagade [A] 5 hereby uphold the ld.CIT(A)’s order. Accordingly, grounds of appeal numbers 1, 2, 3, 4 & 7 are dismissed. 7. Ground No.6 is consequential in nature. Since we have upheld the addition, AO shall calculate interest as per law. Accordingly, Ground No. 6 of assessee is dismissed. 8. Regarding Ground No.5, the Income Tax Act has specifically introduced section 115BBE for the computation of tax liability for additions made under section 68, 69, 69A, 69B, 69C & 69D. The assessee’s case squarely falls under the ambit of section 115BBE, therefore, the AO rightly invoked section 115BBE for computing the tax liability of the assessee. Accordingly, the Ground No.5 is dismissed. 9. No other ground was raised during hearing. 10. In the result, appeal of the assessee is dismissed. Order pronounced in the open Court on 28 th February, 2023. Sd/- Sd/- (S.S.GODARA) (DR. DIPAK P. RIPOTE) JUDICIAL MEMBER ACCOUNTANT MEMBER पुणे / Pune; ᳰदनांक / Dated : 28 th Feb, 2023/ SGR* ITA No.321/PUN/2021 Shubhangi Sudhir Zagade [A] 6 आदेशकᳱᮧितिलिपअᮕेिषत / Copy of the Order forwarded to : 1. अपीलाथᱮ / The Appellant. 2. ᮧ᭜यथᱮ / The Respondent. 3. The CIT(A), concerned. 4. The Pr. CIT, concerned. 5. िवभागीयᮧितिनिध, आयकर अपीलीय अिधकरण, “बी” बᱶच, पुणे / DR, ITAT, “B” Bench, Pune. 6. गाडᭅफ़ाइल / Guard File. आदेशानुसार / BY ORDER, // TRUE COPY // Senior Private Secretary आयकर अपीलीय अिधकरण, पुणे/ITAT, Pune.