JCIT, BIKANER V. Shri Bhanwar Lal Mahendra Kumar Soni, JODHPUR

ITA 338/JODH/2008

• Counselvise Citation: 33823314 RSA 2008
• Duration Of Justice: 3 year(s) 7 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-12-2011
• Appeal Filed By: Department
• Order Result: Partly Allowed
• Bench Allotted: DB
• Next Hearing Date: 30-11-2011
• Assessment Year: 2005-2006
• Appeal Filed On: 09-05-2008
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Assessee Lawyers: N R MERTIA
• Section: 68

Judgement Text

1 ITA 338(2)-08 IN THE INCOME TAX APPELLATE TRIBUNAL JODHPUR BENCH JODHPUR. ( BEFORE SHRI R.K. GUPTA AND SHRI N.L. KALRA ) ITA NO. 338/JODH/2008 ASSTT. YEAR : 2005-06. THE JCIT, RANGE-1, VS. SHRI BHANWAR LAL MAHENDR A BIKANER. KUMAR SONI, SUNARON KI GUWAR, BIKANER. (APPELLANT) (RESPONDENT) C.O. NO. 23/JODH/2008 ( ARISING OUT OF ITA NO. 338/JODH/2008 ) ASSTT. YEAR : 2005-06. SHRI BHANWAR LAL MAHENDRA KUMAR SONI, VS. THE JCIT , RANGE-1, BIKANER. BIKANER. (CROSS OBJECTOR) (RESPONDENT) APPELLANT BY : SHRI MAHESH KUMAR RESPONDENT BY : SHRI N.R. MERTIA DATE OF HEARING : 30.11.2011. DATE OF PRONOUNCEMENT : 09.12.2011. ORDER DATED : 09.12.2011. PER R.K. GUPTA, J.M. THIS IS AN APPEAL BY DEPARTMENT AND CROSS OBJECTIO N BY ASSESSEE AGAINST THE ORDER OF LD. CIT (A) RELATING TO ASSESSMENT YEAR 2005-06. 2. THE DEPARTMENT IS OBJECTING IN RESTRICTING THE U NRECORDED SALES AT RS. 20 LACS AS AGAINST RS. 40 LACS ESTIMATED BY ASSESSING OFFICER AND REDUCING THE GP RATE AT 10% AS AGAINST 11% APPLIED BY THE ASSESSING OFFICER. 2 3. IN CROSS OBJECTION, THROUGH GROUND NO. 6 THE ASS ESSEE IS OBJECTING IN ESTIMATING THE UNRECORDED SALES TO THE EXTENT OF RS. 20 LACS. 4. DURING THE ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER NOTICED THAT THERE ARE CERTAIN UNRECORDED SALES. THE ASSESSEE WAS REQUIRE D TO EXPLAIN THE REASON FOR NOT RECORDING ALL THE SALES. AFTER TAKING INTO CONSIDE RATION THE REPLY AND TAKING INTO CONSIDERATION THE UNRECORDED SALES BY TAKING GROSS WEIGHT OF APPROVAL VOUCHERS ETC., THE ASSESSING OFFICER ESTIMATED GROSS SALES WHICH WERE NOT RECORDED AT RS. 40 LCS AND APPLIED A GP RATE OF 11%. THE LD. CIT (A) AFTER EXAMINING THE DETAILS FOUND THAT IN FACT THE ASSESSING OFFICER HAS ESTIMATED THE UNRECORDED SALE S ON HIGHER SIDE AS HE HAS NOT TAKEN THE GROSS WEIGHT SHOWN IN THE APPROVAL VOUCHERS COR RECT. THEREFORE, HE RESTRICTED THE UNRECORDED SALES AT RS. 20 LACS AND APPLIED A GP RA TE AT 10% AGAINST 11% APPLIED BY ASSESSING OFFICER. 5. THE LD. COUNSEL OF THE ASSESSEE HAS STATED THAT IN FACT THERE WAS UNRECORDED SALES OF RS. 14 LACS WHICH IS VERIFIABLE. THEREFORE, THE ASSESSING OFFICER WAS NOT JUSTIFIED IN ESTIMATING THE RECORDED SALES AT RS. 40 LACS, WHICH WAS RESTRICTED BY LD. CIT (APPEALS) AT RS. 20 LACS. 6. THE LD. D/R ON THE OTHER HAND STATED THAT IT IS NOT COMING OUT FROM ANY DETAILS OR EVIDENCE HOW UNRECORDED SALES WORKS OUT TO RS. 14 L ACS. THEREFORE, IT WAS SUBMITTED THAT IF THE MATTER IS REMANDED BACK TO THE FILE ASSESSIN G OFFICER FOR FRESH CONSIDERATION, IT WILL MEET THE ENDS OF JUSTICE TO BOTH THE SIDES. 7. THE LD. COUNSEL OF THE ASSESSEE DID NOT OBJECT T HE CONTENTION OF THE LD. D/R. 8. IN VIEW OF THE ABOVE FACTS AND CIRCUMSTANCES, WE SET ASIDE THE ORDER OF LD. CIT (A) ON THIS ISSUE AND RESTORE THE ISSUE TO THE FILE OF ASSESSING OFFICER TO EXAMINE THE SAME 3 AFRESH AFTER AFFORDING REASONABLE OPPORTUNITY OF BE ING HEARD TO THE ASSESSEE. THE ASSESSEE IS ALSO ADVISED TO CO-OPERATE WITH THE DEPARTMENT. WE ORDER ACCORDINGLY. 9. SECOND ISSUE OF THE DEPARTMENT IS AGAINST DELETI NG ADDITION OF RS. 6,79,315/- UNDER SECTION 68 OF THE IT ACT. 10. ON PERUSAL OF CAPITAL ACCOUNT OF PARTNER, IT IS REVEALED THAT CAPITAL ACCOUNT OF SMT. DURGA DEVI SONI HAS BEEN CREDITED BY RS. 6,01,532/- . THE ASSESSING OFFICER FURTHER NOTED THAT THE CREDITED CAPITAL ACCOUNT REVEALED TH AT ON 9.5.2004 GOODS PURCHASED WERE SHOWN AT RS. 5,81,532//- AND CASH RECEIVED AT RS. 2 5,000/- ON 23.10.2004 WAS SHOWN. THE ASSESSING OFFICER NOTED THAT DURING THE COURSE OF S URVEY UNDER SECTION 133A, STATEMENT OF SMT. DURGA DEVI SONI WAS RECORDED BY WHICH IT WA S STATED THAT SHE HAS NOT SOLD ANY GOLD JEWELLERY. THEREFORE, THE EXPLANATION OF THE A SSESSEE IS THAT THIS IS ON ACCOUNT OF SALE OF JEWELLERY WAS NOT ACCEPTED AND THE IMPUGNED ADDI TION WAS MADE BY THE ASSESSING OFFICER. INTEREST ON THIS AMOUNT WAS ALSO ADDED. BEFORE LD. CIT (A) IT WAS STATED THAT IN CASE OF SMT. DURGA DEVI, THIS ISSUE HAS BEEN EXAMIN ED AND IT WAS STATED THAT IN FACT THE LADY COULD NOT UNDERSTAND THE QUESTION RAISED BEFOR E AND, THEREFORE, PROPER REPLY COULD NOT BE GIVEN. IT WAS FURTHER SUBMITTED THAT IN FAC T NO JEWELLERY WAS SOLD BUT THE JEWELLERY ITSELF WAS DEPOSITED IN THE PARTNERSHIP FIRM AND VA LUE OF THAT JEWELLERY WAS CREDITED TO THE CAPITAL ACCOUNT OF THE ASSESSEES PARTNER SMT. DURG A DEVI. IT WAS FURTHER SUBMITTED THAT THIS JEWELLERY HAS ALREADY BEEN SHOWN IN THE WEALTH -TAX RETURN. THEREFORE, IT WAS SUBMITTED THAT STATEMENT RECORDED DURING SURVEY DOE S NOT HAVE ANY EVIDENTIARY VALUE AS HELD IN MANY JUDGEMENTS AS THE SAME IS NOT CORROBOR ATED WITH INDEPENDENT EVIDENCE. RELIANCE WAS PLACED ON VARIOUS CASE LAWS. 4 11. AFTER CONSIDERING THE SUBMISSIONS AND PERUSING THE MATERIAL ON RECORD, THE LD. CIT (A) FOUND THAT ASSESSEE DESERVES TO SUCCEED ON THIS ISSUE. HE HAS FOUND THAT SMT. DURGA DEVI WAS ASSESSED TO INCOME-TAX AND WEALTH-TAX AND THE ADDITION WAS MADE IN THE HANDS OF SMT. DURGA DEVI ALSO AND THIS ISSUE HAS BEEN EXA MINED BY HIM WHILE DISPOSING THE APPEAL IN CASE OF SMT. DURGA DEVI. IT WAS FOUND BY HIM THAT THE JEWELLERY WHICH WAS OWNED BY SMT. DURGA DEVI WAS DEPOSITED IN THE FIRM AND THE VALUE OF THE SAME WAS CREDITED TO THE CAPITAL ACCOUNT OF SMT. DURGA DEVI. ACCORDINGLY HE WAS SATISFIED WITH THE EXPLANATION AND DELETED THE ADDITION. 12. REGARDING CASH DEPOSIT OF RS. 25,000/-, AGAIN L D. CIT (A) ASCERTAINED THAT THE SAME WAS RECEIVED FROM TWO CREDITORS I.E. SHRI RAME SHWAR LAL SONI RS. 15,000/- AND SMT. MADHU DEVI SONI RS. 10,000/- AND BOTH OF THEM ARE ASSESSED TO TAX AND THEY HAVE FILED CONFIRMATION ALSO. THEREFORE, HE HELD THAT S OURCE OF CASH DEPOSIT OF RS. 25,000/- WAS EXPLAINED. IN THIS WAY ENTIRE ADDITION OF RS. 6,79,315/- WHICH INCLUDES INTEREST OF RS. 72,783/- + CASH RS. 25,000/- AND VALUE OF GOLD OF RS. 5,81,532/- WAS DELETED. 13. AFTER HEARING RIVAL SUBMISSIONS, WE FIND NO INF IRMITY IN THE FINDING OF LD. CIT (A). THE LD. CIT (A) HAS GIVEN A FINDING OF FACT WHICH R EMAINED UNCONTROVERTED. HE HAS ASCERTAINED THAT SMT. DURGA DEVI WAS ASSESSED TO WE ALTH-TAX AND INCOME-TAX AND SHE WAS OWNING JEWELLERY WHICH WAS DEPOSITED IN THE PAR TNERSHIP FIRM. THEREFORE, THERE IS NO QUESTION OF TREATING THE SAME JEWELLERY AS UNEXPLAI NED. SOURCE OF CASH DEPOSIT WAS ALSO EXPLAINED AS DISCUSSED ABOVE. ACCORDINGLY WE CONFI RM THE FINDING OF LD. CIT (A) IN THIS RESPECT. 5 14. THERE IS NO OTHER GROUND IN THE APPEAL OF THE D EPARTMENT AND VARIOUS OTHER GROUNDS RAISED BY ASSESSEE THROUGH CROSS OBJECTION WERE NOT PRESSED BY LD. A/R. THEREFORE, THEY ARE DISMISSED AS NOT PRESSED. 15. IN THE RESULT, APPEAL OF THE DEPARTMENT AS WELL AS CROSS OBJECTION OF THE ASSESSEE ARE ALLOWED IN PART FOR STATISTICAL PURPOSES. 16. THE ORDER IS PRONOUNCED IN THE OPEN COURT ON 09 .12.2011. SD/- SD/- ( N.L. KALRA ) ( R.K. GUPTA ) ACCOUNTANT MEMBER JUDICIAL MEMBER JODHPUR, COPY FORWARDED TO :- THE JCIT, RANGE-1, BIKANER. SHRI BHANWAR LAL MAHENDRA KUMAR SONI, BIKANER. THE CIT (A) THE CIT THE D/R GUARD FILE (ITA NO. 338(2)/JODH/2008) BY ORDER, AR ITAT JODHPUR.