Anapathi Venkateswara Rao, Visakhapatnam V. Income Tax Officer, Ward-3(2), Visakhapatnam

ITA 387/VIZ/2018

• Counselvise Citation: [2019] 116 COUNSELVISE.COM (IT) 9781 (ITAT-VISAKHAPATNAM)
• Duration Of Justice: 11 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-07-2019
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2014-2015
• Appeal Filed On: 18-07-2018
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: SUMAN MALIK
• Keywords: Unexplained cash credit; Peak credit; Revised return
• Section: 143(3); 143(1); 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL VISAKHAPATNAM BENCH, VISAKHAPATNAM BEFORE SHRI V. DURGA RAO , HONBLE JUDICIAL MEMBER & SHRI D.S. SUNDER SINGH , HONBLE ACCOUNTANT MEMBER ITA NO. 387 / VIZ /201 8 (ASST. YEAR : 20 14 - 15 ) ANAPARTHI VENKATESWARA RAO, D.NO. 53 - 41 - 48/6, FLAT NO.501, C - BLOCK, M.V.V. APARTMENTS, K.R.M. COLONY, SIVALAYAM STREET, VISAKHAPATNAM. V S . IT O , WARD - 3 ( 2 ), VISAKHAPATNAM. PAN NO. ADLPA 3796 R (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI G.V.N. HARI ADV OCATE . DEPARTMENT BY : SMT. SUMAN MALIK SR. DR DATE OF HEARING : 26 / 0 6 /201 9 . DATE OF PRONOUNCEMENT : 03 / 0 7 /201 9 . O R D E R PER V. DURGA RAO, JUDICIAL MEMBER TH IS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF COMMISSIONER OF INCOME TAX (APPEALS) - 10 , HYDERABAD , DATED 15 /0 6 /201 8 FOR THE ASSESSMENT YEAR 20 14 - 15 . 2. FACTS OF THE CASE, IN BRIEF, ARE THAT THE ASSESSEE IS AN INDIVIDUAL ENGAGED IN THE BUSINESS OF CIVIL WORKS, FILED HIS RETURN OF INCOME BY ADMITTING TOTAL INCOME OF RS. 2,13,270/ - . THE RETURN 2 ITA NO. 387/VIZ/2018 ( ANAPARTHI VENKATESWARA RAO ) FILED BY THE ASSESSEE WAS PROCESSED U/SEC. 143(1) OF THE INCOME TAX ACT, 1961 (HEREINAFTER REFERRED TO AS 'ACT'). SUBSEQUENTLY, CASE OF THE ASSESSEE WAS SELECTED FOR SCRUTINY UNDER CASS AND AFTER FOLLOWING DUE PROCEDURE, ASSESSMENT WAS COMPLETED U/SEC. 143(3) OF THE ACT , DATED 15/09/2016. IN THE ASSESSMENT ORDER, THE ASSESSING OFFICER HAS NOTED THAT THE ASSESSEE HAD SHOWN ONLY ONE BANK ACCOUNT IN HIS RETURN OF INCOME I.E. SBI, WALTAIR BRANCH , VISAKHAPATNAM . HOWEVER, ON VERIFICATION OF THE DETAILS THROUGH ITS , IT CAME TO LIGHT THAT THE AS SESSEE IS MAINTAINING SOME OTHER BANK ACCOUNTS . IN THIS REGARD, INSPECTOR OF INCOME TAX WAS DEPUTED TO COLLECT THE BANK ACCOUNTS OF THE ASSESSEES / HIS FAMILY MEMBERS. AS PER INFORMATION GATHERED , IT IS NOTICED THAT THE ASSESSEE HAS MAINTAINED THE FOLLOWING BANK ACCOUNTS: - ( I) SBI, WALTAIR A/C. NO. 20007225032 (II) SBI, DABAGARDENS A/C. NO. 31113296046 (III) AXIS BANK, SEETHAMMADHARA A/C. NO. 3690101001126380 (IV) AXIS BANK, SEETHAMMADHARA A/C. NO. 914010000877461 OUT OF THE ABOVE ACCOUNTS, ASSESSEE SHOWN ONLY ONE ACCOUNT AS MENTIONED AT SERIAL NO. ( I ). DURING THE COURSE OF ASSESSMENT PROCEEDINGS, VIDE ORDER - SHEET ENTRY DATED 08/09/2016, THE AR OF THE ASSESSEE WAS ASKED TO EXPLAIN THE DETAILS OF REMAINING BANK ACCOUNTS AND ALSO ASKED TO FUR NISH NOTE ON CASH DEPOSITS MADE IN ALL THE BANK ACCOUNTS. THE AR OF THE ASSESSEE WAS ASKED WHY THE 3 ITA NO. 387/VIZ/2018 ( ANAPARTHI VENKATESWARA RAO ) BANK ACCOUNTS IN SBI, DABAGARDENS, AXIS BANK, SEETHAMMADHARA WERE NOT DISCLOSED EITHER IN THE ASSESSEES BOOKS OF ACCOUNT OR IN THE RETURN OF INCOME FILED. THE ASSESSEE HAS NOT SUBMITTED TH E DETAILS OF THE SAID BANK ACCOUNTS . AFTER VERIFICATION OF ALL THE BANK ACCOUNTS OF CASH DEPOSITS, TOTAL UNEXPLAINED CASH CREDITS (PEAK CREDITS) COMES TO RS. 47,56,790/ - . SUBSEQUENTLY , THE ASSESSEE VIDE HIS LETTER DATED 13/09/2016 R EQUESTED THE ASSESSING OFFICER TO PERMIT HIM TO FILE THE REVISED RETURN BY TAKING ALL THE DEPOSITS IN BANK ACCOUNT A S MENTIONED SUPRA. THE ASSESSING OFFICER BY CONSIDERING THE ASSESSEES LETTER HAS OBSERVED THAT ASSESSEE CANNOT FILE A REVISED RETURN AT THIS STAGE AS THE TIME FOR SUBMISSION OF REVISED RETURN PROVIDED IN THE STATUTE HAS ALREADY BEEN ELAPSED AND ACCORDINGLY , ASSESSMENT IS COMPLETED BY TAKING INTO CONSIDERATION OF THE CASH CREDITS (PEAK CREDITS) TO THE EXTENT OF RS. 2,09,500/ - AS EXPLAINED AND THE REMAINING BALANCE AMOUNT OF RS. 45,47,290/ - AS UNEXPLAINED CASH CREDIT (PEAK CREDIT) U/SEC. 68 OF THE ACT AND THE SAME IS ADDED TO THE INCOME RETURNED . 3 . ON APPEAL BEFORE THE LD. CIT(A), BY FILING A LETTER ASSESSEE HAS SUBMITTED AS UNDER: - '1. THE INCOME TAX OFFICER WARD 3(2), VISAKHAPATNAM WAS NOT JUSTIFIED BY ADDING OF RS.45,47,290/ - TO THE INCOME STATING THAT AS UNEXPLAINED CASH CREDITS U/S 68 OF THE INCOME TAX ACT, 1961 AND RAISING TAX DEMAND OF RS. 18,27,060/ - IRRESPECTIVE OF INCOME AND EXPENDITURE AND NOT ACCEPTING FOR REVISED RETURN EVEN THOUGH 4 ITA NO. 387/VIZ/2018 ( ANAPARTHI VENKATESWARA RAO ) I AM READY TO SUBMIT THE REVISED RETURN BY TAKING ALL BANK TRANSACTIONS AND PAY TAX. 2. 1 USED TO FILE INCOME TAX RETURN BY TAKING ONE BANK ACCOUNT I.E. CHINAWALTAIR BRANCH, IN ADDITION TO THAT - I HAVE ONE ACCOUNT IN DABA GARDENS SBI THIS WAS USED FOR TRANSACTIONS OF LODGE TAKEN FOR LEASE AND 2 ACCOUNTS IN AXIS BANK IN SEETHAM M ADHARA BRANCH ONE IN MY DAUGHTER DEEPTHI NAME A/C NO. 91401000087461 AND ANOTHER ONE IS IN MY NAME ACCOUNT NO. IS 369010 100126380 AS THESE ACCOUNTS ARE USED FOR PRIVATE CHIT PAYMENTS WHICH IS MAINTAINED BY ME FOR CHILDREN EDUCATION PURPOSE. CHIT FUND MEMBERS FROM OUTSIDE USED TO DEPOSIT CHIT INSTAL L MENT BY CASH AND FOR CHIT BIDDERS I USED TO SEND THROUGH R T G S. BECAUSE TH IS CHIT BUSINESS IS UNOFFICIAL THEREFORE I DID NOT SHOW IN THE RETURN OF INCOME. FROM THIS CHIT AMOUNT I GOT ONLY 4% OF COMMISSION, ON THIS CHIT AMOUNT OF RS. 10.00 LAKHS I.E. RS. 40,000/ - PER MONTH ONLY. IN THE ABOVE INSTANCE I HAVE NO INTENTION OF EVADING TAX. DUE TO LACK OF KNOWLEDGE AND FEAR TO SHOW THE PRIVATE CHIT FUND GROUP MAINTENANCE IN RETURN OF INCOME. I AM REQUESTING YOU TO GIVE RELIEF BY CONSIDERING THE ABOVE FACTS.' 4 . THE LD. CIT(A) HAS CONSIDER ED THE ABOVE SUBMISSIONS AND CON FIRMED THE ORDER OF THE ASSESSING OFFICER BY OBSERVING AS UNDER: - 8. ON PERUSAL OF THE ASSESSMENT ORDER AND THE SUBMISSIONS OF THE APPELLANT , IT IS SEEN THAT THERE IS NO DISPUTE ON THE BASIC FACT OF THE FAILURE, ON THE PART OF THE APPELLANT, TO DISCLOSE ALL BANK ACCOUNTS IN THE RETURN OF INCOME FILED. THE APPELLANT FILED THE RETURN OF INCOME AFTER DUE VERIFICATION AND STILL DELIBERATELY CONCEALED THE TRANSACTIONS IN BOOKS OF ACCOUNT. AFTER THE AO DETECTED THE UNDISCLOSED BANK ACCOUNTS, THE APPELLANT STA TES THAT HE WISHES TO FILE A REVISED RETURN AND PAY TAXES IN RESPECT OF THE TRANSACTIONS REFLECTED IN THE UNDISCLOSED BANK ACCOUNTS. THE APPELLANT CANNOT FILE A VALID REVISED RETURN OF INCOME AS THE CONDITIONS CONTAINED IN SECTION 139(5), RELATING TO FILIN G OF REVISED RETURN, ARE NOT MET. THERE WAS NO DISCOVERY OF ANY OMISSION OR ANY WRONG STATEME NT BY THE APPELLANT. IT WAS THE AO WHO DETECTED THE WI L LFU L ATTEMPT TO EVADE TAX BY NOT DISCLOSING ALL THE BANK ACCOUNTS. FURTHER, THE TIME AVAILABLE TO FURNISH A REVISED RETURN ALSO LAPSED. 5 ITA NO. 387/VIZ/2018 ( ANAPARTHI VENKATESWARA RAO ) 8.1 IN THE WRITTEN SUBMISSIONS, THE APPELLANT HIMSELF IS ADMITTING THAT THE TRANSACTIONS IN THE UNDISCLOSED BANK ACCOUNTS RE LATE TO CHIT BUSINESS WHICH IS UNOFFICIAL. THE STATEMENT OF THE APPELLANT THAT HE ONLY RECEIVED 4% OF THE CHIT AMOUNT AS COMMISSION IS TOTALLY UNSUBSTANTIATED. 8.2 IN VIEW OF THE ABOVE, THE ACTION OF THE AO MAKING THE SAID ADDITION IS UPHELD AND THIS GROU ND OF APPEAL IS DISMISSED. 5. ON BEING AGGRIEVED, ASSESSEE CARRIED THE MATTER IN APPEAL BEFORE THIS TRIBUNAL. 6 . LD. CO U NSEL FOR THE ASSESSEE HAS RELIED ON THE GROUNDS OF APPEAL, WHEREAS LD. DR STRONGLY SUPPORTED THE ORDERS PASSED BY THE AUTHORITIES BELOW. 7 . WE HAVE HEARD BOTH THE SIDES, PERUSED THE MATERIAL AVAILABLE ON RECORD AND ORDERS OF THE AUTHORITIES BELOW . 8 . THE ONLY ISSUE INVOLVED IN THIS APPEAL RELATES TO THE ADDITION MADE BY THE ASSESSING OFFICER U/SEC. 68 OF THE ACT OF RS. 45,47,290/ - . IN RESPECT OF THE ABOVE ADDITION, THE ASSESSEE HAS NOT PROPERLY EXPLAINED NEITHER BEFORE THE ASSESSING OFFICER NOR BEFORE THE LD. CIT(A) . EVEN BEFORE US, NO EXPL A NATION IS MADE. IN THE ABSENCE OF EXPLANATION, T HE ASSESSING OFFICER AFTER TAKING INTO CONSIDERATION OF ALL THE BANK ACCOUNTS MADE A PEAK ADDITION OF RS.45,47,290/ - . THE LD. CIT(A) ALSO , AFTER CONSIDERING THE FACTS AND CIRCUMSTANCES OF THE CASE , CONFIRMED THE ORDER OF THE ASSESSING OFFICER. THEREFORE, W E FIND NO INFIRMITY IN THE ORDER 6 ITA NO. 387/VIZ/2018 ( ANAPARTHI VENKATESWARA RAO ) PASS ED BY THE LD. CIT(A). THUS, THIS APPEAL FILED BY THE ASSESSEE IS DISMISSED. 9. IN THE RESULT, APPEAL FILED BY THE ASSESSEE IS DISMISSED. ORDER PRONOUNCED IN OPEN COURT ON TH IS 0 3 R D DAY OF JU LY , 201 9 . S D / - S D / - ( D.S. SUNDER SINGH ) ( V. DURGA RAO ) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 0 3 R D JU LY , 201 9 . VR/ - COPY TO: 1. THE ASSESSEE ANAPARTHI VENKATESWARA RAO, D.NO. 53 - 41 - 48/6, FLAT NO.501, C - BLOCK, M.V.V. APARTMENTS, K.R.M. COLONY, SIVALAYAM STREET, VISAKHAPATNAM. 2. THE REVENUE ITO, WARD - 3(2), VISAKHAPATNAM. 3. THE PR. CIT - 1, VISAKHAPATNAM. 4. THE CIT(A) - 10, HYDERABAD. 5. THE D.R . , VISAKHAPATNAM. 6. GUARD FILE. BY ORDER (VUKKEM RAMBABU) SR. PRIVATE SECRETARY, ITAT, VISAKHAPATNAM.