Shri Tejas Arvindbhai Raval, Ahmedabad V. The Income Tax Officer (OSD) Ward-7(1), Now Ward-3(3)(5), Ahmedabad

ITA 336/AHD/2016

• Counselvise Citation: [2019] 118 COUNSELVISE.COM (IT) 8190 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 10 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 01-01-2019
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: Not Allotted
• Assessment Year: 2008-2009
• Appeal Filed On: 10-02-2016
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: N J VYAS
• Assessee Lawyers: S N DIVATIA
• Keywords: Unexplained cash credit; Capital asset; Gift; Depreciation; Principle of natural justice; Cost of acquisition; Onus to prove
• Section: 69C; 37; 68

Judgement Text

, ,L ,L,L ,L- -- -,E ,E,E ,E- -- -LH LHLH LH * ** * IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH, AHMEDABAD LOZJH LOZJH LOZJH LOZJH EGKOHJ EGKOHJ EGKOHJ EGKOHJ IZLKN] U; IZLKN] U; IZLKN] U; IZLKN] U;KF KFKF KF;D LNL; , ;D LNL; , ;D LNL; , ;D LNL; ,OA OAOA OA OLHE OLHE OLHE OLHE VGEN] YS[KK VGEN] YS[KK VGEN] YS[KK VGEN] YS[KK LNL; DS LE{KA LNL; DS LE{KA LNL; DS LE{KA LNL; DS LE{KA BEFORE SHRI MAHAVIR PRASAD, JUDICIAL MEMBER AND SHRI WASEEM AHMED, ACCOUNTANT MEMBER ./ I.T.A. NO. 336/AHD/2016 ( / ASSESSMENT YEAR : 2008-09) SHRI TEJAS ARVINDBHAI RAVAL, 803, ANAND HARI TOWER, OPP. CHANAKYA TOWER BODAKDEV, AHMEDABAD 380 015. / VS. ITO(OSD), WARD 7(1), AHMEDABAD. ./ ./ PAN/GIR NO. : AFUPR 7933 J ( / APPELLANT ) .. ( / RESPONDENT ) / APPELLANT BY : SHRI S.N. DIVATIA, A.R. / RESPONDENT BY : SHRI N. J. VYAS, SR. D.R. / DATE OF HEARING 15/10/2018 !'# / DATE OF PRONOUNCEMENT 01/01/2019 $% / O R D E R PER WASEEM AHMED, ACCOUNTANT MEMBER: THE CAPTIONED APPEAL HAS BEEN FILED AT THE INSTANCE OF THE ASSESSEE AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS)3, AHMEDABAD [CIT(A) IN SHORT] VIDE APPEAL NO.CIT(A)-3 /ITO.WD- 3(3)(5)/189/2014-15 DATED 03.12.2015 ARISING IN THE MATTER OF ASSESSMENT ORDER PASSED UNDER S.143(3) OF THE INCOME TAX ACT, 1961(HERE-IN-AFTER REFERRED TO AS 'THE ACT') DATED 27.12.2010 RELEVANT TO ASSESSMENT YEAR (AY) 2008-09. ITA NO.336/AHD/2016 SHRI TEJAS ARVINDBHAI RAVAL VS. ITO(OSD) A.Y. 2008-09 - 2 - 2. THE GROUNDS OF APPEAL RAISED BY THE ASSESSEE A RE AS UNDER: 1.1 THE ORDER PASSED U/S.250 ON 3-12-2015 FOR A. Y.2008-09 BY CIT(A)-3, ABAD UPHOLDING THE ADDITIONS MADE BY AO IS WHOLLY I LLEGAL, UNLAWFUL AND AGAINST THE PRINCIPLES OF NATURAL JUSTICE. 1.2 THE LD. C1T(A) HAS GRIEVOUSLY ERRED IN LAW AND OR ON FACTS IN NOT CONSIDERING FULLY AND PROPERLY THE SUBMISSIONS MADE AND EVIDENCE PRODUCED BY THE APPELLANT WITH, REGARD TO THE IMPUG NED ADDITIONS. 2.1 THE LD. CTT(A) HAS GRIEVOUSLY ERRED IN LAW AND ON FACTS IN CONFIRMING THE FOLLOWING ADDITIONS: (A) CASH DEPOSITS IN BANA A/C - RS.4,27,192/- (B) CREDIT CARD PAYMENTS - RS. 1,50,633/- (C) STCG FROM SALE OF SHOP - RS. 4,00,000/- 2.2 THAT IN THE FACTS AND CIRCUMSTANCES OF THE CA SE AS WELL AS IN LAW, THE LD.CIT(A) OUGHT NOT TO HAVE UPHELD THE ABOVE SAID A DDITIONS. IT IS, THEREFORE, PRAYED THAT THE ADDITIONS UPHELD BY THE CIT(A) MAY KINDLY BE DELETED. 3. AT THE OUTSET, WE NOTE THAT THERE WAS A DELAY IN FILING THE APPEAL BY THE ASSESSEE FOR ONE DAY. THE ASSESSEE ACCORDINGLY FILED THE PETITION FOR THE CONDONATION OF DELAY. 4. THE LEARNED DR AFTER CONSIDERING THE DELAY DID N OT RAISE ANY OBJECTION. ACCORDINGLY, WE CONDONE THE DELAY AND PR OCEED TO ADJUDICATE THE APPEAL FILED BY THE ASSESSEE. 5. THE FIRST ISSUE RAISED BY THE ASSESSEE IS THAT L EARNED CIT(A) ERRED IN CONFIRMING THE ADDITION OF RS. 4,27,192/- OUT OF THE TOTAL ADDITION MADE BY THE AO FOR RS. 8,35,672/-. ITA NO.336/AHD/2016 SHRI TEJAS ARVINDBHAI RAVAL VS. ITO(OSD) A.Y. 2008-09 - 3 - 6. BRIEFLY STATED FACTS ARE THAT THE ASSESSEE IS AN INDIVIDUAL AND ENGAGED IN THE FOLLOWING BUSINESSES: I. TRADING OF U-FORM & RUBBER UNDER THE NAME AND STYLE AS M/S. KRISHNA FOAM PALACE. II. THE ASSESSEE IS ALSO A PARTNER IN M/S. KRISHNA WEB EXPRESS. III. TRADING IN WOODEN ACTIVITIES. 6.1 THE AO DURING THE ASSESSMENT PROCEEDINGS OBSERV ED THAT THE ASSESSEE HAD MADE THE DEPOSIT AS WELL AS THE WITHDR AWAL OF MONEY FROM THE SAVING A/C OF BANK OF BARODA BEARING A/C NO. 07 340100007908 AS WELL AS IN THE CAPITAL A/C MAINTAINED WITH PARTNERS HIP FIRM NAMELY M/S. KRISHNA WEB EXPRESS. THE NECESSARY DETAILS OF THE A MOUNT WITHDRAWN AND DEPOSITS OF MONEY FROM THE BANK AND CAPITAL ACC OUNT STANDS AS UNDER: SR. NO. PARTICULARS AMOUNT WITHDRAWN AMOUNT DEPOSITS DEPOSITS NET WITHDRAWN 1. BANK OF BARODA 1,51,500/- 10,33,390/- 8,81,890/- 2. M/S. KRISHNA WEB SERVICES 3,96,111/- 4,35,793/- 39,682/- TOTAL 9,21,572/- IN VIEW OF THE ABOVE, THE LEARNED AO PROPOSED TO MA KE THE ADDITION OF RS. 9,21,572/- U/S 68 OF THE ACT AND ACCORDINGLY SO UGHT AN EXPLANATION FROM THE ASSESSEE. ITA NO.336/AHD/2016 SHRI TEJAS ARVINDBHAI RAVAL VS. ITO(OSD) A.Y. 2008-09 - 4 - 6.2 THE ASSESSEE IN COMPLIANCE THEREOF SUBMITTED TH AT THE AO HAD NOT CONSIDERED CERTAIN WITHDRAWAL ENTRIES FROM THE BANK AS DETAILED UNDER: I. CASH WITHDRAWAL FROM BANK OF BARODA - 26,900/- II. CASH WITHDRAWAL FROM THE INDIAN OVERSEAS BANK - 59,000/- TOTAL - 85,900/- 6.3 THE AO AFTER CONSIDERING THE SUBMISSION OF THE ASSESSEE HAS GIVEN THE BENEFIT OF RS. 85,900/- AND TREATED THE BALANCE AMOUNT OF RS. 8,35,672/- (9,21,572 85,900) AS UNEXPLAINED CASH CREDIT U/S 68 OF THE ACT. ACCORDINGLY, THE AO ADDED THE SAID DIFFERENCE TO THE TOTAL INCOME OF THE ASSESSEE. 7. AGGRIEVED, ASSESSEE PREFERRED AN APPEAL TO LEARN ED CIT(A). THE ASSESSEE BEFORE THE LEARNED CIT(A) SUBMITTED AS UND ER: I. THERE WAS THE WITHDRAWAL OF RS. 3,10,970/- FROM THE PARTNERSHIP ACCOUNT NAMELY M/S. KRISHNA FOAM PALACE WHICH HAS B EEN USED FOR THE DEPOSIT OF CASH. THE ASSESSEE FURTHER SUBMI TTED THAT THE INCOME FROM SUCH PARTNERSHIP CONCERN WAS NOT DISCLO SED IN THE INCOME TAX RETURN. ACCORDINGLY, THE PROFIT WORKED O UT BY THE AO OF RS. 1,62,980/- WAS ADMITTED DURING THE ASSESSMEN T PROCEEDINGS. ACCORDINGLY, THE ASSESSEE CLAIMED THAT HE SHOULD BE ALLOWED SET OFF FROM THE DEPOSIT OF CASH IN THE BANK TO THE TUN E OF RS.3,10,970/-. II. HE HAS INCURRED A SUM OF RS. 1,38,480/- ON BEHA LF OF THE PARTNERSHIP FIRM NAMELY M/S. KRISHNA WEB EXPRESS WH ICH WAS REIMBURSED TO HIM IN THE FORM OF CASH OR CHEQUE. TH E AMOUNT REIMBURSED BY THE FIRM WAS USED IN THE DEPOSIT OF C ASH IN THE BANK ACCOUNT WITH THE BANK OF BARODA. ITA NO.336/AHD/2016 SHRI TEJAS ARVINDBHAI RAVAL VS. ITO(OSD) A.Y. 2008-09 - 5 - 7.1 THE ASSESSEE ALSO CLAIMED THAT IT HAD MADE PAYM ENT TO RELIANCE GROUP TOWARDS THE TELEPHONE BILLS, EXPENSES, ETC. T HROUGH HIS CITI BANK CREDIT CARD ON BEHALF OF CUSTOMERS. AS SUCH, THESE CUSTOMERS HAVE REIMBURSED TO HIM A SUM OF RS. 1,44,190/- WHICH WAS USED FOR THE DEPOSIT OF CASH IN THE BANK ACCOUNT OF BANK OF BARO DA. 7.2 HE HAS TAKEN A GIFT IN CASH FROM HIS WIFE AMOUN TING TO RS. 2,70,000/-. THE ASSESSEE CLAIMED THAT SHE HAD GIVEN A LOAN TO HIM OUT OF THE PAST SAVINGS. THE ASSESSEE IN SUPPORT OF HIS CL AIM HAS FILED THE COPY OF INCOME TAX RETURN AS WELL AS AN AFFIDAVIT OF HIS WIFE. 7.3 THERE WAS CASH INCOME FROM THE TRADE OF WOODEN ACTIVITIES AMOUNTING TO RS. 31,973/- WHICH WAS DULY DISCLOSED IN THE INCOME TAX RETURN. THEREFORE, THE SAME SHOULD HAVE BEEN CONSID ERED BY THE AO WHILE MAKING THE ADDITION ON ACCOUNT OF CASH CREDIT FOR THE MONEY DEPOSITED IN THE BANK ACCOUNT. THE LEARNED CIT(A) A FTER CONSIDERING THE SUBMISSION OF THE ASSESSEE DELETED THE ADDITION MADE BY THE AO IN PART BY OBSERVING AS UNDER: I HAVE GONE THROUGH THE FACTS INCLUDING THOSE MENT IONED IN REMAND REPORT AND PERUSED THE APPELLANT'S REJOINDER. AS RE GARDS GIFT OF RS. 2,70,000/- RECEIVED FROM WIFE WHO HAS FILED AFFIDAV IT DATED 02.05.2014, IT IS MENTIONED THAT THE CONTENTS OF AFFIDAVIT ARE NOT PROVED WRONG BY THE AO, THE SAME IS GIVEN CREDENCE AND APPELLANT'S RELA TED CASH CREDIT OF RS. 2,70,000/- IS CONSIDERED AS EXPLAINED. BY FILIN G THE NAME OF DONOR MODE AND AMOUNT RECEIVED THROUGH AN AFFIDAVIT, THE APPELLANT HAS SHIFTED THE ONUS TO THE DEPARTMENT SHE IS REGULARLY FILING I.T. RETURNS. ITA NO.336/AHD/2016 SHRI TEJAS ARVINDBHAI RAVAL VS. ITO(OSD) A.Y. 2008-09 - 6 - AS REGARDS REIMBURSEMENT OF RS. 1,38,480/- IN CASH BY DIFFERENT 4 CLIENTS, U IS SUBMITTED BY APPELLANT THAT THE EQUIV ALENT PAYMENTS WERE MADE BY APPELLANT THROUGH ACCOUNT PAYEE CHEQUE TO T HE PRINCIPAL FOR AND ON BEHALF OF CLIENTS. IN VIEW OF APPELLANT'S PR OPRIETARY BUSINESS AND COMPULSIONS MENTIONED FOR BUSINESS EXPEDIENCY, A BE NEFIT OF DOUBT IS GIVEN TO APPELLANT AND RS. 1,38,480/- IS CONSIDERED AS EXPLAINED AS SPECIFIC NAMES AND AMOUNTS ARE ON RECORD. THIS IS T HE TOTAL AMOUNT WHICH HAS BEEN ALLOWED IN RELATION TO THE BUSINESS WITH RELIANCE GROUP WHETHER IT IS WEB OR TELEPHONY SERVICES AND IN RELA TION TO ANY OF THE BUSINESS ENTITY OF THE APPELLANT. IN GUISE OF SUCH EXPLANATION, APPELLANT FURTHER DESIRED BENEFIT FOR RS. 1,44,190/- IN A ROU NDABOUT MANNER, WHICH IS NOT ACCEPTED, HENCE THE AMOUNT OF RS. 1,44 ,190/- IS CONFIRMED. THE FACTS AS EMANATING FROM REMAND REPORT AND REJO INDER OF APPELLANT DO INDICATE THAT APPELLANT WAS ENGAGED IN BUSINESS OF TRADING IN U-FORM & RUBBER IN THE NAME & STYLE OF M/.S KRIS HNA FOAM PALACE, THE INCOME OF SUCH BUSINESS REMAINED TO BE DISCLOSE D BY THE APPELLANT IN RETURN OF INCOME. THE ADDITION OF RS. 1,62,980 /- WAS MADE BY AO IN ASSESSMENT ORDER FOR THE PROFITS SO ARISEN IN THIS UNDISCLOSED BUSINESS THE APPELLANT IS TRYING TO EXPLAIN ANOTHER CASH DEP OSITS EQUIVALENT TO RS. 3,10,970/- SAYING THAT THE SAID CASH WAS WITHDR AWN FROM THIS UNDISCLOSED BUSINESS AND FILET STATEMENT OF INCOME ETC. APPELLANT CANNOT GET BENEFIT OUT OF ITS ILLEGAL ACTIVITY I.E BUSINES S WHICH WAS UNEARTHED BY THE A O. DURING ASSESSMENT PROCEEDINGS. I AM CONST RAINED TO CONCLUDE THAT THESE ARE MANUFACTURED DESIGN TO DECEIVE THE D EPARTMENT. I REJECT THIS EXPLANATION AND CONFIRM THE ADDITION OF RS. 3, 10,970/- ACCORDINGLY. SIMILARLY APPELLANT HAS MANUFACTURED DESIGN TO EXPL AIN CASH OF RS. 31,973/-SAYING THAT THE CASH WAS FROM PLYWOOD B USINESS WHICH REMAINED TO BE DISCLOSED. THE ATTITUDE OF APPELLANT AND SURROUNDING CIRCUMSTANCES DO NOT IMBIBE CONFIDENCE TO ACCEPT SU CH EXPLANATION AT A STAGE WHEN MUCH OF WATER HAS PASSED UNDER THE BRIDG E. APPELLANT IS DOING MANY BUSINESS IN UNORGANIZED MANNER AND BEYON D THE REALM OF HIS BOOKS OF ACCOUNT. APPELLANT HAS NOT COME TO APP ELLATE AUTHORITY WITH CLEAN HANDS APPELLANT'S ARGUMENT IS REJECTED AND AD DITION OF RS. 31,973/-IS CONFIRMED. ITA NO.336/AHD/2016 SHRI TEJAS ARVINDBHAI RAVAL VS. ITO(OSD) A.Y. 2008-09 - 7 - IT IS CLARIFIED THAT THERE IS OVERLAPPING OF FIGURE S BY THE APPELLANT DURING SUBMISSION OF EXPLANATIONS FOR DIFFERENT CAS H DEPOSITS AMOUNTING TO RS. 14,69,183/- THE AO ACCEPTED ALL POSSIBLE EXP LANATIONS AND MADE ADDITION U/S.68 ONLY OF RS. 8,35,672/-. THE APPELLA NT HAS FURTHER GOT RELIEF OF RS. 4,08,480/- OUT OF THE ADDITION MADE F OR CASH DEPOSITS IN THE BANK ACCOUNTS. CONSEQUENTLY, ADDITION OF RS. 4 , 27,192/- IS CONFIRMED. THE GROUND NO.3 IS THEREFORE PARTLY ALLOWED. BEING AGGRIEVED BY THE ORDER OF LEARNED CIT(A) ASSE SSEE IS IN APPEAL BEFORE US. 8. THE LEARNED AR BEFORE US FILED A PAPER BOOK RUNN ING FROM PAGES 1-116 AND REITERATED THE SUBMISSIONS AS MADE BEFORE THE LEARNED CIT(A). 9. ON THE OTHER HAND, LEARNED DR VEHEMENTLY SUPPORT ED THE ORDER OF AUTHORITIES BELOW. 10. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE MATERIALS AVAILABLE ON RECORD. FROM THE PRECEDING DISCUSSION, WE NOTE THAT THE ISSUE RELATES TO THE CASH DEPOSITED BY THE ASSESSEE DURIN G THE ASSESSMENT YEAR UNDER CONSIDERATION. SUCH CASH DEPOSIT WAS TREATED BY THE AO AS AN UNEXPLAINED CASH CREDIT U/S 68 OF THE ACT. THEREFOR E THE ADDITION MADE BY THE AO. HOWEVER, IN FIRST APPEAL, THE LEARNED CIT(A ) PARTLY CONFIRMED THE ORDER OF AO. NOW THE CONTROVERSY BEFORE US RELATES TO THE CONFIR MATION OF THE ADDITION MADE BY THE LEARNED CIT(A) IN RESPECT OF THE FOLLOW ING ITEMS: ITA NO.336/AHD/2016 SHRI TEJAS ARVINDBHAI RAVAL VS. ITO(OSD) A.Y. 2008-09 - 8 - I. USE OF CREDIT CARD ON BEHALF OF THE ASSESSEE AMO UNTING TO RS. 1,44,190/-. II. WITHDRAWAL OF CASH AMOUNTING TO RS. 3,10,970/- FROM THE PARTNERSHIP FIRM. III. INCOME FROM THE WOODEN ACTIVITIES AMOUNTING TO RS. 31,973/-. FIRST ISSUE: USES OF CREDIT CARD ON BEHALF OF THE C USTOMERS AMOUNTING TO RS. 1,44,190/- THE ASSESSEE IN HIS CASH BOOK HAS SHOWN PAYMENT TO CREDIT CARD BY WAY OF CASH AMOUNTING TO RS. 93,050/-. AS PER TH E ASSESSEE, THIS CASH WAS RECEIVED AGAINST THE USE OF CREDIT CARD ON BEHA LF OF THE CUSTOMERS. IT MEANS THAT SUCH CASH PAYMENT WAS NOT DEPOSITED I N THE BANK ACCOUNT. SO NO CREDIT CAN BE GIVEN TO THE ASSESSEE FOR THE D EPOSIT OF SUCH CASH IN BANK. AS SUCH, THE ARGUMENT OF THE ASSESSEE IS CONT RARY TO THE CASH BOOK FILED BEFORE US. THE AMOUNT OF RS. 93,050/- RECEIVE D BY THE ASSESSEE FROM THE CUSTOMERS FOR THE EXPENSES INCURRED BY HIM WAS NEVER DEPOSITED IN THE BANK ACCOUNT. THEREFORE, WE HOLD THAT THE ARGUM ENT OF THE ASSESSEE IS MISLEADING AND ACCORDINGLY WE AGREE WITH THE VIE W OF THE LEARNED CIT(A) TO THIS EXTENT I.E. DEPOSIT OF CASH IN THE B ANK OF RS. 93,050/- ONLY. FOR THE BALANCE OF RS. 51,140/- (1,44,190 93,050) , THE ASSESSEE CLAIM TO HAVE RECEIVED THIS MONEY FROM THE CUSTOMERS IN C ASH FOR THE EXPENSES INCURRED ON THEIR BEHALF THROUGH CREDIT CARD. HOWEV ER, THE ASSESSEE BEFORE US FAILED TO FURNISH THE BASIC DETAILS OF TH E PARTIES WHO HAVE GIVEN MONEY TO THE ASSESSEE. ITA NO.336/AHD/2016 SHRI TEJAS ARVINDBHAI RAVAL VS. ITO(OSD) A.Y. 2008-09 - 9 - THE ASSESSEE HAS ALSO NOT FURNISHED THE DETAILS OF THE PARTIES JUSTIFYING WHETHER SUCH PAYMENT FOR CUSTOMERS WAS RECEIVED IN CASH OR THROUGH BANKING CHANNEL. AS PER THE ASSESSEE, IT WAS RECEIV ED IN CASH WHICH HAS BEEN SHOWN IN ITS CASH BOOK. BUT IN THE ABSENCE OF ANY SUPPORTING DOCUMENTS AND THE DETAILS OF THE CUSTOMER/PARTIES O N WHOSE BEHALF THE EXPENSES WERE INCURRED THROUGH CREDIT CARD, WE ARE NOT INCLINED TO INTERFERE IN THE ORDER OF THE AUTHORITIES BELOW. THE ADDITION WAS MADE BY THE AO U/S 68 OF THE ACT, AND THE ONUS IS ON THE ASSESSEE TO PROVE THAT THE IMPUGNED AMOUNT DOES NOT REPRESENT THE CASH CREDIT AS ENVISAGED U/S 68 OF THE ACT. THUS, I N THE ABSENCE OF DOCUMENTARY EVIDENCE, WE ARE NOT INCLINED TO UPHOLD THE ORDER OF LOWER AUTHORITIES FOR THE ADDITION TO THE EXTENT OF RS. 5 1,140/-. REGARDING THE BURDEN OF PROOF ON THE ASSESSEE TO EX PLAIN THE SOURCE OF UNEXPLAINED CASH CREDIT, WE RELY ON THE ORDER OF AP EX COURT IN CASE OF KALE KHAN MOHAMMAD HANIF (50 ITR 1) WHEREIN IT WAS HELD AS UNDER: THE FIRST QUESTION THAT ARISES FOR DISCUSSION IS Q UESTION NO. 4, WHICH WAS IN THESE TERMS: 'WHETHER THE BURDEN OF PROVING THE SOURCE OF THE CA SH CREDITS IS ON THE ASSESSEE ?' IT SEEMS TO US THAT THE ANSWER TO THIS QUESTION MUS T BE IN THE AFFIRMATIVE AND THAT IS HOW IT WAS ANSWERED BY THE HIGH COURT. IT IS WELL ESTABLISHED THAT THE ONUS OF PROVING THE SOURCE OF A SUM OF MON EY FOUND TO HAVE BEEN RECEIVED BY THE ASSESSEE IS ON HIM. ITA NO.336/AHD/2016 SHRI TEJAS ARVINDBHAI RAVAL VS. ITO(OSD) A.Y. 2008-09 - 10 - NEXT ISSUE: WITHDRAWAL FROM THE FIRM NAMELY M/S. KR ISHNA FOAM PALACE AMOUNTING TO RS. 3,10,970/-: IT IS AN UNDISPUTED FACT THAT THE ASSESSEE HAS NOT SHOWN ANY INCOME IN THE INCOME TAX RETURN FROM M/S. KRISHNA FOAM PALACE. TH EREFORE, THE AO WORKED OUT THE INCOME OF RS. 1,62,980/- FROM M/S KR ISHNA FOAM PALACE AND ADDED TO THE TOTAL INCOME OF THE ASSESSEE WHICH WAS NOT DISPUTED BY THE ASSESSEE. HOWEVER, ON PERUSAL OF THE MATERIALS AVAILABLE ON R ECORD, WE NOTE THAT THE ASSESSEE HAS SHOWN INCOME FROM M/S KRISHNA FOAM PALACE IN THE IMMEDIATELY PRECEDING ASSESSMENT YEAR WHICH WAS ALS O ACCEPTED BY THE REVENUE. ON PERUSAL OF THE FINANCIAL STATEMENTS OF KRISHNA FOAM PALACE OF THE PREVIOUS ASSESSMENT YEAR, WE NOTE THAT THE A SSESSEE HAS SHOWN BALANCE IN ITS CAPITAL ACCOUNT AMOUNTING TO RS. 4,9 6,077/- AS EVIDENT FROM THE BALANCE SHEET OF THE ASSESSEE PLACED ON PAGE 46 OF THE PAPER BOOK. THE RELEVANT EXTRACT IS REPRODUCED AS UNDER: TEJAS ARVINDBHAI RAVAL PROP. M/S KRISHNA FOAM PALACE BALANCE SHEET AS ON 31.03.2007 CAPITAL AND LIABILITIES AMOUNT TEJAS A. RAVAL CAPITAL A/C BAL B/D 435780 ADD: PROFIT 140297 576077 LESS: DRAWING 80000 496077 ITA NO.336/AHD/2016 SHRI TEJAS ARVINDBHAI RAVAL VS. ITO(OSD) A.Y. 2008-09 - 11 - ON PERUSAL OF THE CAPITAL ACCOUNT OF THE ASSESSEE M AINTAINED WITH M/S. KRISHNA FOAM PALACE, WE NOTE THAT THE ASSESSEE HAS WITHDRAWN A SUM OF RS. 3,10,970/- IN THE YEAR UNDER CONSIDERATION. ACC ORDINGLY, THE ASSESSEE CLAIMED THAT HE HAD DEPOSITED THE CASH IN THE BANK OF BARODA FOR AN AMOUNT OF RS. 3,10,970/-. ACCORDINGLY, THE ASSESSE E SOUGHT TO GIVE THE CREDIT FOR THE DEPOSIT OF THE MONEY WHICH WAS WITHD RAWN FROM THE CAPITAL ACCOUNT. IT IS AN UNDISPUTED FACT THAT THE AO HAS A CCEPTED THE INCOME FROM THE BUSINESS OF M/S. KRISHNA FOAM PALACE WHICH WAS BROUGHT UNDER THE NET OF TAX. IN OUR CONSIDERED VIEW, THE DOCUMEN TARY EVIDENCE BY WHICH THE AO HAS DETERMINED THE INCOME FOR RS. 1,62 ,980/- HAS TO BE ACCEPTED IN TOTALITY. AS SUCH THE ASSESSEE IN THE S AME SET OF DOCUMENTS, HAS SHOWN WITHDRAWAL FROM THE CAPITAL ACCOUNT FOR R S. 3,10,970/- FOR WHICH NO CREDIT WAS GIVEN TO HIM. THE RELEVANT EXTR ACT OF THE CAPITAL ACCOUNT IS PLACED ON PAGE 42 OF THE PAPER BOOK WHIC H READS AS UNDER: TEJAS RAVAL CAPITAL A/C FOR THE F.Y. 2007-08 PARTICULARS AMOUNT PARTICULARS AMOUNT TO CASH WITHDRAWAL TO LIC TO CLOSING BALANCE 310970 29075 319012 BY OPENING BALANCE BY NET PROFIT 496077 162980 TOTAL 659057 TOTAL 659057 BECAUSE OF THE ABOVE, WE ARE OF THE VIEW THAT THE A SSESSEE IS ENTITLED TO THE CREDIT OF THE AMOUNT WHICH WAS WITHDRAWN FROM T HE CAPITAL ACCOUNT OF THE FIRM. ITA NO.336/AHD/2016 SHRI TEJAS ARVINDBHAI RAVAL VS. ITO(OSD) A.Y. 2008-09 - 12 - WE ALSO NOTE THAT THE LEARNED CIT(A) HAS NOT GIVEN CREDIT TO THE ASSESSEE CONSIDERING THE NATURE OF INCOME OF THE ASSESSEE AS ILLEGAL. HOWEVER, WE NOTE THAT NO REASON HAS BEEN ADDUCED BY THE LEARNED CIT(A) FOR TREATING THE BUSINESS OF THE ASSESSEE AS ILLEGAL. AS SUCH, W E ARE OF THE VIEW THAT THE ASSESSEE HAS NOT CARRIED OUT ANY ILLEGAL ACTIVI TY. IT IS BECAUSE THE SAME ACTIVITY WAS DISCLOSED IN THE INCOME TAX RETURN IN THE IMMEDIATELY PRECEDING ASSESSMENT YEAR WHICH WAS DULY ADMITTED B Y THE REVENUE. THERE WAS NO ISSUE REGARDING THE ACTIVITIES WHETHER THERE WERE ILLEGAL DURING THE EARLIER ASSESSMENT YEAR. THUS IN OUR CON SIDERED VIEW, MERELY NON-DISCLOSURE OF INCOME CANNOT RENDER THE ACTIVITY OF THE ASSESSEE AS ILLEGAL. THEREFORE, WE DISAGREE WITH THE FINDING OF THE LOWER AUTHORITIES. WE ALSO NOTE THAT THE EXPLANATION TO SECTION 37 OF THE ACT DENIES FOR THE DEDUCTION OF THE EXPENSES WHICH ARE IN THE NATURE O F ILLEGAL. HOWEVER, IN THE CASE BEFORE US, THE ASSESSEE IS NOT CLAIMING AN Y EXPENSES AGAINST SUCH INCOME RATHER HE WAS TRYING TO JUSTIFY THE SOURCE O F CASH DEPOSITED IN THE BANK ACCOUNT OF THE ASSESSEE. WE FURTHER NOTE THAT THE ASSESSEE HAS SHOWN DRAWING OF RS. 80,000/- IN THE IMMEDIATELY PRECEDING AY FROM THE BUSINESS CARR IED OUT UNDER THE NAME OF M/S. KRISHNA FOAM PALACE. THEREFORE, THE AR GUMENT OF THE ASSESSEE THAT ENTIRE WITHDRAWAL OF RS. 3,10,970/- W AS USED FOR THE DEPOSIT OF CASH IN THE BANK ACCOUNT IS NOT TENABLE. IN OUR VIEW, THERE MUST BE SOME ELEMENT OF PERSONAL DRAWINGS WHICH CANNOT BE U SED FOR DEPOSITING ITA NO.336/AHD/2016 SHRI TEJAS ARVINDBHAI RAVAL VS. ITO(OSD) A.Y. 2008-09 - 13 - OF CASH IN THE BANK. IN THE ABSENCE OF ANY INFORMAT ION ABOUT THE DRAWINGS IN THE YEAR UNDER CONSIDERATION, WE ARE AS SUMING THE SAME FOR RS. 1,00,000/- ONLY. THUS, WE INFER THAT THE SUM OF RS. 2,10,970/- WAS USED FOR THE DEPOSIT OF CASH IN THE BANK. 3 RD ISSUE: INCOME FROM WOODEN ACTIVITIES AMOUNTING TO RS. 31,973/-: IT IS AN UNDISPUTED FACT THAT THE INCOME FROM WOODE N ACTIVITY AMOUNTING TO RS. 31,973/- WAS DISCLOSED BY THE ASSE SSEE IN INCOME TAX RETURN WHICH WAS DULY ADMITTED BY THE AO. THEREFORE , WE CAN INFER THAT THE AMOUNT OF RS. 31,973/- MUST BE AVAILABLE TO THE ASSESSEE TO DEPOSIT THE SAME IN THE BANK. BECAUSE OF THE ABOVE, WE REDUCED THE AMOUNT OF RS. 31,973/- AND RS. 2,10,970/- BEING THE PROFIT FROM WOODEN BUSINESS AN D WITHDRAWAL OF MONEY FROM THE M/S. KRISHNA FOAM PALACE FROM THE AD DITION CONFIRMED BY THE LEARNED CIT(A). THUS, THE ASSESSEE GETS THE RELIEF FOR RS. 2,42,943/- ONLY. ACCORDINGLY, THE ASSESSEE FAILS FO R THE ADDITION OF RS. 1,84,249/- AND ACCORDINGLY WE CONFIRMED THE SAME. T HUS, THE GROUND OF APPEAL OF THE ASSESSEE IS PARTLY ALLOWED . 11. THE NEXT ISSUE RAISED BY THE ASSESSEE IS THAT L EARNED CIT(A) ERRED IN CONFIRMING THE ADDITION OF RS. 1,50,633/- FOR TH E USE OF CREDIT CARD EXPENSES. ITA NO.336/AHD/2016 SHRI TEJAS ARVINDBHAI RAVAL VS. ITO(OSD) A.Y. 2008-09 - 14 - 12. THE ASSESSEE DURING THE YEAR HAS INCURRED EXPEN SES THROUGH CITI BANK CREDIT CARD AMOUNTING TO RS. 3,14,536/- ONLY. THE AO DURING THE ASSESSMENT PROCEEDING FOUND THAT THE ASSESSEE HAS M ADE PAYMENT AGAINST THE USE OF CREDIT CARD FOR RS. 1,63,903/- THROUGH B ANKING CHANNEL, I.E. BANK OF BARODA AND INDIAN OVERSEAS BANK. HOWEVER, THERE WAS NO DETAIL FURNISHED BY THE ASSES SEE FOR THE PAYMENT OF THE REMAINING AMOUNT OF RS. 1,50,633/- (RS. 3,14 ,536 1,63,903). THEREFORE, THE SAME WAS ADDED BY THE AO U/S 69C OF THE ACT TO THE TOTAL INCOME OF THE ASSESSEE. 13. AGGRIEVED, ASSESSEE PREFERRED AN APPEAL TO LEAR NED CIT(A). THE ASSESSEE BEFORE THE LEARNED CIT(A) SUBMITTED THAT H E HAD UTILIZED THE CREDIT CARD FOR MAKING THE PAYMENT ON BEHALF OF HIS CUSTOMERS. THE ASSESSEE ALSO SUBMITTED THAT AN AMOUNT OF RS. 93,05 0/- HAS BEEN PAID THROUGH CASH WHICH WAS RECEIVED FROM THE CUSTOMERS. THE ASSESSEE IN SUPPORT OF HIS CLAIM FILED THE COPIES OF THE CREDIT CARD STATEMENT AS WELL AS CASH BOOK. HOWEVER, THE LEARNED CIT(A) DISREGARD ED THE CONTENTION OF THE ASSESSEE AND CONFIRMED THE ORDER OF AO BY OB SERVING AS UNDER: THE APPELLANT IS USING CREDIT CARDS AND CASH TRANS ACTIONS FOR QUITE A FEW UNDISCLOSED ACTIVITIES AND SOME SUCH BUSINESS A CTIVITIES HAVE GOT UNRAVELED ONLY BECAUSE OF SCRUTINY ASSESSMENT. APPE LLANT CANT GET BENEFIT OF CERTAIN ACTS UNDERTAKEN AGAINST LAW AS P ER PROVISIONS OF I.T. ACT 1961. THE AO HAS ALREADY GIVEN ADEQUATE CREDIT TO THE APPELLANT AND MADE ADDITION ONLY OF RS. 1,50,633/- OUT OF TOT AL AMOUNT OF RS. 3,14,536/-. THE EXPLANATION OF APPELLANT FOR RS. 1, 50,633/- IS HEREBY ITA NO.336/AHD/2016 SHRI TEJAS ARVINDBHAI RAVAL VS. ITO(OSD) A.Y. 2008-09 - 15 - REJECTED AND THE ADDITION MADE BY THE AO IS HEREBY CONFIRMED. THE GROUND NO.4 IS THEREFORE DISMISSED. BEING AGGRIEVED BY THE ORDER OF LEARNED CIT(A) ASSE SSEE IS IN APPEAL BEFORE US. 14. THE LEARNED AR BEFORE US SUBMITTED THAT THE CRE DIT CARD WAS UTILIZED FOR MAKING THE PAYMENT ON BEHALF OF HIS CU STOMERS. AS SUCH, THESE CUSTOMERS HAVE BEEN REIMBURSED THE PAYMENT TO THE ASSESSEE IN CASH WHICH WAS PARTLY DEPOSITED IN CASH IN THE BANK ACCOUNT, AND PARTLY CASH WAS USED DIRECTLY TO MAKE THE PAYMENT TO THE C ITI BANK. 14.1 THE ASSESSEE FURTHER SUBMITTED THAT THERE WAS AN OUTSTANDING AMOUNT OF RS. 44450/- IN THE CREDIT CARD STATEMENT AS ON 31.03.2008, WHICH WAS NOT PAID TO THE BANK. THE LEARNED AR IN S UPPORT OF HIS CLAIM DREW OUR ATTENTION ON PAGE 72 OF THE PAPER BOOK WHE RE THE SUMMARY OF THE TRANSACTIONS OF THE CREDIT CARD STATEMENT VIS- -VIS DEBIT AND CREDIT AMOUNTS TOWARDS PAYMENT MADE ON BEHALF OF CUSTOMERS WERE PLACED. 15. ON THE OTHER HAND, LEARNED DR VEHEMENTLY SUPPOR TED THE ORDER OF AUTHORITIES BELOW. 16. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE MATERIALS AVAILABLE ON RECORD. ON PERUSAL OF THE CREDIT CARD STATEMENT, WE NOTE THAT THE ASSESSEE HAS BEEN MAKING PAYMENT TO THE RE LIANCE WEBSTORE AND ITA NO.336/AHD/2016 SHRI TEJAS ARVINDBHAI RAVAL VS. ITO(OSD) A.Y. 2008-09 - 16 - RELIANCE INFOCOM LIMITED. THE ASSESSEE ALSO CLAIMED TO HAVE BEEN ENGAGED WITH THE RELIANCE GROUP FOR HIS BUSINESS AC TIVITIES. ON PERUSAL OF THE BALANCE SHEET OF THE ASSESSEE PLACED ON PAGE 43 OF THE PAPER BOOK, WE ALSO FOUND THAT THE ASSESSEE HAS SHOWN DEA LERSHIP DEPOSIT WITH RELIANCE INFOCOM FOR RS. 44000/-ONLY. NONE OF THE A UTHORITIES BELOW HAS DOUBTED THE FACT OF DEALERSHIP DEPOSIT WITH RELIANC E INFOCOM LTD. THEREFORE, WE CAN INFER THAT THE ASSESSEE WAS ENGAG ED WITH THE RELIANCE GROUP FOR THE BUSINESS. IN VIEW OF THE ABOVE, WE HOLD THAT THE ASSESSEE HAS INCURRED THE EXPENSES THROUGH CREDIT CARD ON BEHALF OF HIS CUSTOMERS. IT IS ALSO EVIDENT FROM THE CASH BOOK PRODUCED BY THE ASSESSEE AND PLACED O N RECORD WHERE THE ASSESSEE HAS SHOWN THE REIMBURSEMENT FROM THE CUSTO MERS. ON PERUSAL OF THE CASH BOOK, WE FIND THAT THE ASSESSEE HAS MADE P AYMENT DIRECTLY TO THE CITI BANK IN CASH FOR RS. 93,050/- ONLY. THEREFORE, WE ARE INCLINED TO HOLD THAT THE ASSESSEE HAS NOT UTILIZED THE CREDIT CARD FOR HIS PERSONAL PURPOSES. RATHER, THE CREDIT CARD HAS BEEN UTILIZED BY THE ASSESSEE ON BEHALF OF THE CUSTOMERS WHO SUBSEQUENTLY REIMBURSED THE COST TO THE ASSESSEE AS EVIDENT FROM THE CASH BOOK PLACED ON RE CORD. BESIDES THE ABOVE, WE ALSO NOTE THAT THE ASSESSEE H AS SHOWN AN OUTSTANDING AMOUNT OF RS. 44,450/- ON 31.03.2008 IN THE ACCOUNT OF CITI BANK CREDIT CARD WHICH HAS NOT BEEN PAID IN THE YEA R UNDER CONSIDERATION . THUS THE SOURCE OF UTILIZATION OF C REDIT CARD TO THE EXTENT ITA NO.336/AHD/2016 SHRI TEJAS ARVINDBHAI RAVAL VS. ITO(OSD) A.Y. 2008-09 - 17 - OF RS. 44,450/- STANDS EXPLAINED. THEREFORE, THE PR OVISION OF SECTION 69C OF THE ACT CANNOT BE APPLIED. IN ADDITION TO THE ABOVE, WE ALSO NOTE THAT THE ASS ESSEE HAS SHOWN REIMBURSEMENT OF THE MONEY FROM THE CUSTOMERS AGAIN ST THE USE OF CREDIT CARD. BUT NONE OF THE AUTHORITY BELOW HAS BROUGHT A NYTHING CONTRARY TO THE ARGUMENT ADVANCED BY THE ASSESSEE. IT IS EVIDEN T THAT THE ASSESSEE HAS RECEIVED MONEY FROM HIS CUSTOMERS AGAINST THE USE O F CREDIT CARD AS EVIDENT FROM THE CASH BOOK PLACED ON RECORD. UNDER THE PROVISION OF SECTION 69C OF THE ACT, THE ONUS LIES ON THE REVENU E TO PROVE THAT THE ASSESSEE HAS INCURRED EXPENSES OUT OF UNDISCLOSED S OURCES. IN THIS REGARD, WE PLACE OUR RELIANCE ON THE ORDER OF THIS TRIBUNAL IN CASE OF S.F. WADIA VS. ITO ( 19 ITD 306 ) WHEREIN IT WAS HELD AS UNDER: 14. THE PHRASEOLOGY IN THE SECTION GOES TO SHOW THAT BE FORE INVOKING THE SECTION IT MUST BE CONCLUSIVELY ESTABLISHED BY EVIDENCE OR MATERIAL TO PROVE THAT THE AMOUNT SPENT IS AN EXPENDITURE AN D THE EXPENDITURE IS INCURRED BY THE ASSESSEE ONLY AND THE SAME IS NOT D EDUCTIBLE WHILE COMPUTING THE INCOME UNDER ANY HEAD UNDER THE ACT. THUS, THE PRIMARY ONUS IS ON THE REVENUE. AS THE ACTIVITY OF THE ASSESSEE WITH RELIANCE GROUP HAS BEEN ADMITTED, THEN THE AMOUNT OF EXPENSES INCURRED THROUGH CREDIT CARD FOR THE PURPOSE OF BUSINESS ACTIVITIES CAN BE A SUBJECT MAT TER OF PROFIT. THE ENTIRE AMOUNT CANNOT BE ADDED TO THE INCOME OF THE ASSESSE E. IN THIS CONNECTION, WE FIND SUPPORT AND GUIDANCE FROM THE JUDGMENT OF H ONBLE GUJARAT ITA NO.336/AHD/2016 SHRI TEJAS ARVINDBHAI RAVAL VS. ITO(OSD) A.Y. 2008-09 - 18 - HIGH COURT IN THE CASE OF PRESIDENT INDUSTRIES REPORTED IN 258 ITR 654 WHEREIN IT WAS HELD AS UNDER: THE AMOUNT OF SALES BY ITSELF CANNOT REPRESENT THE INCOME OF THE ASSESSEE WHO HAS NOT DISCLOSED THE SALES. THE SALES ONLY REPRESENT THE PRICE RECEIVED BY THE SELLER OF THE GOODS FOR THE A CQUISITION OF WHICH IT HAS ALREADY INCURRED THE COST. IT IS THE REALISATIO N OF EXCESS OVER THE COST INCURRED THAT ONLY FORMS PART OF THE PROFIT INCLUDE D IN THE CONSIDERATION OF SALES. THEREFORE, UNLESS THERE IS A FINDING TO T HE EFFECT THAT THE INVESTMENT BY WAY OF INCURRING COST IN ACQUIRING GO ODS WHICH HAVE BEEN SOLD HAS BEEN MADE BY THE ASSESSEE AND THAT HAS ALS O NOT BEEN DISCLOSED, THE QUESTION WHETHER ENTIRE SUM OF UNDIS CLOSED SALES PROCEEDS CAN BE TREATED AS INCOME, ANSWERS BY ITSEL F IN THE NEGATIVE. CONSIDERING THE ABOVE FACTS IN TOTALITY, WE ARE OF THE VIEW THAT NO ADDITION IS WARRANTED U/S 69C FOR RS. 1,50,633/- I N THE GIVEN FACTS AND CIRCUMSTANCES. THEREFORE, WE SET ASIDE THE ORDER OF LEARNED CIT(A) AND DIRECT THE AO TO DELETE THE ADDITION MADE BY HIM. H ENCE, THE GROUND OF APPEAL OF THE ASSESSEE IS ALLOWED . 17. THE LAST GROUND RAISED BY THE ASSESSEE IS THAT LEARNED CIT(A) ERRED IN ADDING THE SUM OF RS. 4,00,000/- AS SHORT TERM CAPITAL GAIN ON ACCOUNT OF SALE OF THE COMMERCIAL SHOP. 18. THE AO DURING THE YEAR OBSERVED THAT THE ASSESS EE HAD SOLD COMMERCIAL SHOP AMOUNTING TO RS. 4,00,000/- DATED 2 8.03.2008 BUT THE ASSESSEE SHOWED NO INCOME IN HIS INCOME TAX RETURN. ITA NO.336/AHD/2016 SHRI TEJAS ARVINDBHAI RAVAL VS. ITO(OSD) A.Y. 2008-09 - 19 - 18.1 THE AO FURTHER OBSERVED THAT THE PROPERTY SOLD BY THE ASSESSEE WAS COMMERCIAL IN NATURE ACCORDINGLY HE PRESUMED TH AT THE ASSESSEE MUST HAVE CLAIMED DEPRECIATION ON SUCH SHOP IN THE INCOME TAX RETURN OF THE ENTIRE COST OF ACQUISITION. ACCORDINGLY, THE AO TREATED THE ENTIRE AMOUNT OF SALE CONSIDERATION AS SHORT TERM CAPITAL GAIN AND ADDED TO THE TOTAL INCOME OF THE ASSESSEE. 19. AGGRIEVED, ASSESSEE PREFERRED AN APPEAL TO LEAR NED CIT(A). THE ASSESSEE BEFORE THE LEARNED CIT(A) SUBMITTED THAT H E WAS ACTING AS A POWER ATTORNEY HOLDER ON BEHALF OF THE OWNER SHRI H IRENBHAI DEVENDRABHAI DAVE. AS SUCH, THE ASSESSEE HAS RECEIV ED A SUM OF RS. 4,00,000/- ON BEHALF OF SHRI HIRENBHAI DEVENDRABHAI WHICH WAS SUBSEQUENTLY REMITTED TO THE OWNER IN CASH. THE ASS ESSEE IN SUPPORT OF HIS CLAIM FILED A COPY OF SALE DEED DATED 28.03.2008. T HE ASSESSEE ALSO CLAIMED THAT THE SHOP WAS ACQUIRED BY SHRI HIRENBHA I DEVENDRABHAI DAVE ON 24.12.1999. THUS, THE SHOP IS LONG TERM CAP ITAL ASSET. 19.1 THE ASSESSEE ALSO SUBMITTED THAT A POWER OF AT TORNEY IN HIS NAME DOES NOT ENTITLE HIM TO BE THE OWNER OF THE PROPERT Y. THEREFORE, THE SAME CANNOT BE ADDED TO HIS HANDS. 19.2 WITHOUT PREJUDICE TO THE ABOVE, THE ASSESSEE A LSO SUBMITTED THAT THE PROPERTY IS LONG TERM CAPITAL ASSET AND THEREFO RE ONLY LONG TERM CAPITAL GAIN CAN BE ADDED IN HIS HAND AFTER CONSIDE RING THE COST OF ITA NO.336/AHD/2016 SHRI TEJAS ARVINDBHAI RAVAL VS. ITO(OSD) A.Y. 2008-09 - 20 - ACQUISITION AS ON 24.12.1999. HOWEVER, THE LEARNED CIT(A) DISREGARDED THE CONTENTION OF THE ASSESSEE AND CONFIRMED THE OR DER OF AO BY OBSERVING AS UNDER: I HAVE GONE THROUGH THE FACTS OF THE CASE AND FIND THE ACTION OF AO IN ORDER AND AS PER LAW. BASICALLY, UNDISCLOSED TRANSA CTION BROUGHT INTO THE BOOKS FOR WHICH APPELLANT INFACT SHOULD BE MORE THAN HAPPY. MONETARY AFFAIRS CANT PROLONG FOR LONG OUT OF BOOK S OF ACCOUNT. THERE HAS NOT BEEN ANY FACT BROUGHT ON RECORD BY THE APPE LLANT AS TO WHY HE ACTED AS POWER OF ATTORNEY OF SHRI HERENBHAI DEVEND RABHAI DAVE AND WHY THE TRANSACTION WAS IN CASH, WHAT RELATION THE APPELLANT HAS WITH SHRI DAVE OR THE DEVELOPER, IS NOT KNOWN. APPELLANT IS CONCEALING MORE THAN REVEALING TO THE DEPARTMENT, MAYBE IT IS SERVI NG HIS PURPOSE AS MORE INFORMATION MAY LEND HIM IN MORE TROUBLE UNDER VARIOUS PROVISIONS OF THE ACT. FOR INSTANCE WHO IS ACTING BENAMIDAR OF WHOM I.E. APPELLANT OR SHRI DAVE OR VICE VERSA AND WHO W AS BEHIND THE DESIGNING OF ROUTING THE TRANSACTION THROUGH CASH. THE BALANCE OF EVIDENCES IS ENTIRELY AGAINST THE APPELLANT AS INCO NSISTENT STAND IS APPARENT FROM THE VERY BEGINNING ON THIS ISSUE. THE TRANSACTION WAS TOTALLY CONCEALED AND WHEN CAUGHT THEN APPELLANT IS TRYING HALF- HEARTEDLY FOR SO-CALLED COST-INDEXATION CLAIM. WHEN NOTHING HISTORICALLY IS VALIDATED AS PER IT PROVISIONS, APPELLANT CANT BE GIVEN BENEFIT OUT OF NOTHING. THE GROUND NO5 IS THEREFORE DISMISSED. BEING AGGRIEVED BY THE ORDER OF LEARNED CIT(A) ASSE SSEE IS IN APPEAL BEFORE US. 20. THE LEARNED AR BEFORE US DREW OUR ATTENTION ON PAGE 103 TO 116 WHERE THE COPY OF SALE DEED DATED 27.03.2008 WAS PL ACED. AS PER THE AR FURTHER SUBMITTED THAT THE ASSESSEE WAS NOT THE OWN ER OF THE PROPERTY AND AS SUCH HE WAS MERELY THE POWER OF ATTORNEY HOLDER. THEREFORE, NO ADDITION CAN BE MADE IN THE HANDS OF THE ASSESSEE. ITA NO.336/AHD/2016 SHRI TEJAS ARVINDBHAI RAVAL VS. ITO(OSD) A.Y. 2008-09 - 21 - 21. ON THE OTHER HAND, LEARNED DR VEHEMENTLY SUPPOR TED THE ORDER OF AUTHORITIES BELOW. 22. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE MATERIALS AVAILABLE ON RECORD. FROM THE PRECEDING DISCUSSION, WE NOTE THAT THE OBSERVATION OF THE AO SUFFERS FROM SEVERAL INFIRMIT IES /DISCREPANCIES AS DETAILED UNDER: I. THERE IS NO DETAIL BROUGHT ON RECORD BY THE AO S HOWING THAT THE ASSESSEE CLAIMED DEPRECIATION IN ITS BOOKS OF ACCOU NTS OF THE ENTIRE AMOUNT REPRESENTING THE COST OF ACQUISITION OF THE SHOP. II. THE ASSESSEE IS MERELY A POWER OF ATTORNEY HOLD ER. THEREFORE NO CAPITAL GAIN IN HIS HANDS CAN BE ADDED. III. THERE IS NO INFORMATION AVAILABLE WHETHER THE REAL OWNER NAMELY SHRI HIRENBHAI D. DAVE HAS SHOWN ANY INCOME IN THEI R HANDS ON ACCOUNT OF SALE OF SUCH PROPERTY. IF IT IS SO, THEN IT WILL LEAD THE DOUBLE ADDITION OF THE SAME AMOUNT. THE CLAIM OF TH E ASSESSEE THAT HE HAS COLLECTED THE MONEY FROM THE SALE OF PROPERT Y ON BEHALF OF THE OWNER AND SUBSEQUENT PAYMENT TO THE OWNER HAS N OT BEEN DISPUTED BY THE AUTHORITIES BELOW. IN VIEW OF THE ABOVE, WE ARE OF THE VIEW THAT THE A UTHORITIES BELOW HAVE NOT BROUGHT SUFFICIENT DETAILS SUGGESTING THAT THE ASSESSEE HAS SOLD THE PROPERTY WITHOUT SHOWING IN THE INCOME TAX RETURN. AS SUCH, IT WAS CLAIMED BY THE ASSESSEE THAT HE IS NOT THE OWNER OF THE PROPERTY. THEREFORE, IT WAS NOT DISCLOSED IN THE INCOME TAX R ETURN. IN THE ABSENCE OF ANY DOCUMENTARY EVIDENCE, WE ARE OF THE VIEW THA T THE ORDER PASSED BY THE AUTHORITIES BELOW BY MAKING ADDITION ON ACCOUNT OF SHORT-TERM CAPITAL ITA NO.336/AHD/2016 SHRI TEJAS ARVINDBHAI RAVAL VS. ITO(OSD) A.Y. 2008-09 - 22 - GAIN AMOUNTING TO RS. 4,00,000/- IS NOT SUSTAINABLE IN THE GIVEN FACTS AND CIRCUMSTANCES. THEREFORE, WE REVERSE THE ORDER OF A UTHORITIES BELOW AND DIRECT THE AO TO DELETE THE ADDITION MADE BY HIM. H ENCE, THE GROUND OF APPEAL OF THE ASSESSEE IS ALLOWED . 23. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS PARTLY ALLOWED. THIS ORDER PRONOUNCED IN OPEN COURT ON 01/01/2019 SD/- SD/- EGKOHJ IZLKN EGKOHJ IZLKN EGKOHJ IZLKN EGKOHJ IZLKN OLHE VGEN OLHE VGEN OLHE VGEN OLHE VGEN U;KF;D LNL U;KF;D LNL U;KF;D LNL U;KF;D LNL ; YKS[KK LNL; ; YKS[KK LNL; ; YKS[KK LNL; ; YKS[KK LNL; (MAHAVIR PRASAD) (WASEEM AHMED) JUDICIAL MEMBER ACCOUNTANT MEMBER AHMEDABAD; DATED 01/01/2019 PRITI YADAV, SR.PS !'# $#! / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. & '( ) / CONCERNED CIT 4. ) () / THE CIT(A)-3, AHMEDABAD. 5. ,-. //'( , '(# , 12$&$ / DR, ITAT, AHMEDABAD. 6. .34 5 / GUARD FILE. % & / BY ORDER, , / //TRUE COPY// '/& () ( DY./ASSTT.REGISTRAR) , / ITAT, AHMEDABAD 1. DATE OF DICTATION 01/11/2018 (DICTATION PAGE-22) 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER : 24/12/2018 3. OTHER MEMBER.. 4. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR.P. S./P.S27/12/2018 5. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE D ICTATING MEMBER FOR PRONOUNCEMENT.. 6. DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR.P .S./P.S .. 7. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 8. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK 9. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT RE GISTRAR FOR SIGNATURE ON THE ORDER 10. DATE OF DESPATCH OF THE ORDER