The Income Tax Officer, Ward-2(1)(1), Ahmedabad V. Tushar Girjashankar Dave, Ahmedabad

ITA 40/AHD/2023

AI Insights

The case involves the Income Tax Officer, Ward-2(1)(1), Ahmedabad as the appellant and Tushar Girjashankar Dave as the respondent. The dispute arose from the assessment order under section 143(3) of the Income Tax Act, 1961 for the Assessment Year 2017-18, where the Assessing Officer added Rs. 77,84,612 as unexplained/undisclosed cash deposits in various bank accounts of the assessee. The CIT(A) later deleted these additions, leading to the Revenue's appeal. The ITAT noted the absence of a remand report and the failure to verify the bank statements before deleting the additions, thus setting aside the matter for further verification by the JAO.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 114216 (ITAT-AHMEDABAD)
• Duration Of Justice: 8 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-10-2023
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 13-08-2023
• Assessment Year: 2017-2018
• Appeal Filed On: 18-01-2023
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Principle of natural justice; Set aside
• Section: 143(1)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD “C” BENCH Before: Shri Ramit Kochar, Accountant Member And Shri T.R. Senthil Kumar, Judicial Member The Income Tax Officer, Ward-2(1)(1), Ahmedabad (Appellant) Vs Tushar Girjashankar Dave, 27, Ankur Commercial Centre, Ankur, Naranpura, Ahmedabad-380013 PAN: AASPD7356G (Respondent) Assessee Represented: Shri Prateek Jain, A.R. Revenue Represented: Shri Ravidnra, Sr.D.R. Date of hearing : 14-08-2023 Date of pronouncement : 06-10-2023 आदेश/ORDER PER : T.R. SENTHIL KUMAR, JUDICIAL MEMBER:- This appeal is filed by the Revenue as against the appellate order dated 06.12.2022 passed by the Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi, (in short referred to as “NFAC”), arising out of the assessment order passed under section 143(3) of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’) relating to the Assessment Year (A.Y) 2017-18. ITA No. 40/Ahd/2023 Assessment Year 2017-18 I.T.A No. 40/Ahd/2023 A.Y. 2017-18 Page No ITO Vs. Tushar Girja Shankar Dave 2 2. The solitary ground raised by the Revenue is that the Ld. CIT(A) erred in deleting the addition of Rs. 77,84,612/- without appreciating the facts of the case. 3. The brief facts of the case is that the assessee is an individual and engaged in the business of Sale of Mobile Recharge Vouchers and Mobile Accessories in the name and style of M/s. TOHFA Mobiles. For the Assessment Year 2017-18, the assessee filed its Return of Income on 31-10-2017 declaring total income of Rs. 2,83,450/-. The return was processed u/s. 143(1) of the Act. Thereafter taken up for scrutiny assessment on account of “Large Cash deposits in bank accounts during the year”. 3.1. During the assessment proceedings, there was a difference of cash credit of Rs. 65,21,187/- in the bank account at The Kalupur Commercial Co.Op. Bank Ltd. Further the assessee failed to disclose bank accounts with ICICI Bank and HDFC Bank wherein accounts are maintained in the name of TOHFA Mobiles. Thus the assessee was required to explain the same and why this amount should not be added as the undisclosed income of the assessee. Though the assessee has not replied to the show cause notice, but submitted that the entire income of the assessee from trading of mobile is offered for taxation. Thus the Assessing Officer has no option but to make an addition of Rs. 77,84,612/- as the unexplained/undisclosed cash deposits with various banks and determined the total income at Rs. 80,68,060/- and demanded tax thereon. I.T.A No. 40/Ahd/2023 A.Y. 2017-18 Page No ITO Vs. Tushar Girja Shankar Dave 3 4. Aggrieved against the same, the assessee filed an appeal before Ld. NFAC. During the appellate proceedings, the assessee submitted copy of the profit and loss account, balance sheet where all these bank accounts are reflected including ICICI & HDFC Bank accounts. Therefore as evident from the Profit and Loss account and balance sheet, the primary suspicion of A.O. on the basis of which the impugned addition is made has been proved without having any basis and thereby the Ld. CIT(A) deleted the additions made by the Assessing Officer observing that the additions are based on conjectures and surmises and allowed the assessee appeal. 5. Aggrieved against the same, the Revenue is in appeal before us. Ld. Sr. D.R. submitted that the Ld. CIT(A) erred in deleting the additions made without verifying the bank statements of ICICI Bank and HDFC Bank and also without calling for remand report from the Assessing Officer. Thus the relief granted by the Ld. CIT(A) is against the Principle of Natural Justice and the matter may be set aside back to the file of the Assessing Officer for verification of the same. 6. Per contra, the Ld. Counsel for the assessee submitted that all the bank accounts have been recorded in the books of accounts and the assessee get its books audited by Chartered Accountant and the bank account balances are very much available in the audited balance sheet. Thus the Assessing Officer is not correct in treating the credit entries in the bank account and the income of the assessee. Further all the cash deposits are recorded in the cash book as well as bank accounts and the source thereon are reflected in the cash book. Hence there is no escapement of income while accounting and the I.T.A No. 40/Ahd/2023 A.Y. 2017-18 Page No ITO Vs. Tushar Girja Shankar Dave 4 books are audited. Thus order passed by Ld. NFAC does not require any interference and pleaded to dismiss the Revenue appeal. 7. We have given our thoughtful consideration and perused the materials available on record. It is seen from the assessment order on perusal of the profit and loss account and the balance sheet wherein the bank balances of ICICI Bank and HDFC Bank as reflecting in the balance sheet. Based on the same, the Ld. NFAC deleted the additions made by the Assessing Officer. We also noted that the Ld. NFAC has not called for any Remand Report from the Assessing Officer before deleting the additions made by the Assessing Officer, which is against the Principle of Natural Justice. Therefore in the interest of Principle of Natural Justice, we deem it fit to set aside the matter back to the file of the Jurisdictional Assessing Officer (JAO) to verify the details (with the limited purpose of verifying) of the bank details of The Kalupur Commercial Co.Op. Bank Ltd., Ahmedabad ICICI Bank and HDFC Bank and pass assessment order in accordance with law. Needless to state, the assessee should cooperate with the JAO for completing the assessment order. With this observation, the appeal filed by the Revenue is allowed for statistical purpose. 8. In the result, appeal filed by the Revenue is hereby allowed for statistical purpose. Order pronounced in the open court on 06-10-2023 Sd/- Sd/- (RAMIT KOCHAR) (T.R. SENTHIL KUMAR) ACCOUNTANT MEMBER True Copy JUDICIAL MEMBER Ahmedabad : Dated 06/10/2023