Rupa Sanjay Nigade, Pune V. The Income Tax Officer, Ward-6(2), Pune

ITA 380/PUN/2023

AI Insights

The case involves Rupa Sanjay Nigade, who appealed against the order of the CIT(A) confirming the addition of Rs.5,74,662 to her income for the assessment year 2017-18. The addition was initially made by the Assessing Officer (AO) on the grounds of unrecorded sales income, estimated at 4% profit. The CIT(A) upheld this decision, leading to the appeal before the ITAT. Additionally, an amount of Rs.4,64,500 deposited during the demonetization period was also treated as unexplored business receipts. The ITAT partly allowed the appeal, treating the Rs.4,64,500 as unrecorded business receipts but increased the estimated income by Rs.18,580.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 124130 (ITAT-PUNE)
• Duration Of Justice: 1 month(s) 14 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-05-2023
• Appeal Filed By: Assessee
• Order Result: PartlyAllowed
• Bench Allotted: SMC
• Next Hearing Date: 15-05-2023
• Assessment Year: 2017-2018
• Appeal Filed On: 02-04-2023
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH, PUNE BEFORE SHRI R.S. SYAL, VICE PRESIDENT आयकर अपील सं. /ITA No.380/PUN/2023 नधा रण वष / Assessment Year : 2017-18 Rupa Sanjay Nigade, Flat No.203, S.No.42, Shriniwas Greenland County, Near Navle Hospital, Narhegaon, Pune 411 041 PAN : AWTPN8731E Vs. ITO, Ward-6(2), Pune Appellant Respondent आदेश / ORDER PER R.S. SYAL, VP: This appeal by the assessee arises out of the order dated 22-03-2023 passed by the CIT(A) in National Faceless Appeal Centre, Delhi u/s.250 of the Income-tax Act, 1961 (hereinafter also called ‘the Act’) in relation to the assessment year 2017-18. 2. The first issue raised in this appeal is against the confirmation of addition of Rs.5,74,662/- made by the Assessing Officer (AO) on estimation of income. 3. Filtering out unnecessary details, the facts of the case are that assessee furnished return declaring total income of Rs.3,57,730/-. The AO observed during the course of assessment proceedings that the Assessee by : Shri M.K. Kulkarni Revenue by : Shri Suresh Gaikwad Date of hearing 16-05-2023 Date of pronouncement 17-05-2023 ITA No. 380/PUN/2023 Rupa Sanjay Nigade 2 assessee made cash deposits in the bank during the year amounting to Rs.1,48,11,055/- comprising of deposits of Rs.4,64,500/- during the demonetization period and Rs.1,43,46,555/- during other days of the year. Since no books of accounts were maintained, the AO treated Rs.1.43 crore as unrecorded sales and estimated 4% profit thereon resulting into an addition of Rs.5,74,662/-. No relief was allowed in the first appeal, against which the assessee has approached the Tribunal. 4. After hearing the rival submissions and going through the relevant material on record, it is seen that the assessee could not co- relate the bank deposits of Rs.1.43 crore with actual sales either before the AO or the ld. CIT(A). Same position continues before the Tribunal as well. In the absence of such information, the authorities cannot be held to illogical in treating such amount as unrecorded sales and estimating profit thereon. I, therefore, countenance the view taken by the ld. CIT(A) on this score. 5. The second ground is against the confirmation of addition of Rs.4,64,500/-, being, the amount deposited by the assessee in the bank account during demonetization period. The AO treated such amount as unexplained u/s.69A and made addition for the same which was ITA No. 380/PUN/2023 Rupa Sanjay Nigade 3 approved in the first appeal. Aggrieved thereby, the assessee has come up in appeal before the Tribunal. 6. Having heard both the sides and perused the relevant material on record, it is seen that the assessee deposited Rs.1.43 crore in the bank on other days of the year, which was treated by the AO as unrecorded sale. The deposit of Rs.4,64,500/- in the bank account during demonetization period cannot be given a different colour than what was given for the remaining whole of the year. I, therefore, treat Rs.4,64,500/- as deposit of unrecorded sale proceeds in the same manner as has been treated by the AO for the remaining part of the year. The addition thus made is directed to be deleted. However, it is pertinent to note that while estimating income at 4% on the unrecorded sales, the AO excluded Rs.4,64,500/- for consideration. Since this amount is also taken as unrecorded business receipts, the income towards the estimate of profit is increased by Rs.18,580/- (4% of Rs.4,64,500/-). 7. In the result, the appeal is partly allowed. Order pronounced in the Open Court on 17 th May, 2023. Sd/- (R.S.SYAL) VICE PRESIDENT पुणे Pune; िदनांक Dated : 17 th May, 2023 सतीश ITA No. 380/PUN/2023 Rupa Sanjay Nigade 4 आदेश की ितिलिप अ ेिषत/Copy of the Order is forwarded to : 1. अपीलाथ / The Appellant; 2. थ / The Respondent 3. 4. 5. The Pr.CIT concerned DR, ITAT, ‘SMC’ Bench, Pune गाड फाईल / Guard file. आदेशानुसार/ BY ORDER, // True Copy // Senior Private Secretary आयकर अपीलीय अिधकरण ,पुणे / ITAT, Pune Date 1. Draft dictated on 16-05-2023 Sr.PS 2. Draft placed before author 17-05-2023 Sr.PS 3. Draft proposed & placed before the second member JM 4. Draft discussed/approved by Second Member. JM 5. Approved Draft comes to the Sr.PS/PS Sr.PS 6. Kept for pronouncement on Sr.PS 7. Date of uploading order Sr.PS 8. File sent to the Bench Clerk Sr.PS 9. Date on which file goes to the Head Clerk 10. Date on which file goes to the A.R. 11. Date of dispatch of Order. *