RAJENDRA BATHLA, Jaipur V. ITO, Kota

ITA 412/JPR/2016

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 4886 (ITAT-JAIPUR)
• Duration Of Justice: 7 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-12-2016
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: Not Allotted
• Assessment Year: 2007-2008
• Appeal Filed On: 21-04-2016
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: POONAM RAI D DHK
• Keywords: Business income; Opportunity of being heard; Principle of natural justice; Peak credit; Additional evidence; Corroborative evidences
• Section: 148

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES (SMC), JAIPUR JH HKKXPUN] YS[KK LNL; DS LE{K BEFORE: SHRI BHAGCHAND, ACCOUNTANT MEMBER VK;DJ VIHY LA-@ ITA NO. 412/JP/2016 FU/KZKJ.K O'K Z@ ASSESSMENT YEAR : 2007-08 SHRI RAJENDRA BATHLA B-470, INDRA VIHAR, KOTA CUKE VS. THE ITO WARD- 1(1), KOTA LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO .: ABWPB 8268 N VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT FU/KZKFJRH DH VKSJ LS@ ASSESSEE BY:SHRI SHRAWAN KUMAR GUPTA JKTLO DH VKSJ LS@ REVENUE BY :SMT. POONAM RAI, DCIT-DR LQUOKBZ DH RKJH[K@ DATE OF HEARING : 29/11/2016 ?KKS'K .KK DH RKJH[K@ DATE OF PRONOUNCEMENT : 02 /12/2016 VKNS'K@ ORDER PER BHAGCHAND, AM THE ASSESSEE HAS FILED AN APPEAL AGAINST THE ORDE R OF THE LD. CIT(A), KOTA DATED 18-02-2016 FOR THE ASSESSMENT YE AR 2007-08 RAISING THEREIN FOLLOWING GROUNDS OF APPEAL:- 1.1 THE IMPUGNED ORDER U/S 147/144 DATED 1-03-201 6 IS BAD IN LAW AND ON FACTS OF THE CASE, FOR WANT OF JURISD ICTION, BARRED BY LIMITATION AND VARIOUS OTHER REASONS AND HENCE THE SAME MAY KINDLY BE QUASHED. ITA NO. 412/JP/2016 SHRI RAJENDRA BATHLA VS. ITO, WARD- 1(1), KOTA . 2 1.2 THE ACTION TAKEN U/S 147IS BAD IN LAW AND ON FA CTS OF THE CASE FOR WANT OF JURISDICTION AND VARIOUS OTHER REA SONS AND HENCE THE SAME MAY KINDLY BE QUASHED. 2. THE LD. CIT(A) FURTHER HAS GROSSLY ERRED IN LAW AS WELL AS ON THE FACTS OF THE CASE IN SUSTAINING THE ADDIT ION OF RS. 3,71,898/- OUT OF RS. 10,21,500/- MADE BY THE AO ON ACCOUNT OF CASH DEPOSITS IN THE BANK ACCOUNT BY TAKING THE PEAK CREDIT. HENCE, THE ADDITION SO MADE BY THE AO AND PARTLY CONFIRMED BY THE LD. CIT( A) IS BEING TOTALLY CONTRARY TO THE PROVISIONS OF LAW AND FACTS ON THE RECORDS HENCE THE SAME MAY KINDLY BE DELETED IN FULL. 3. THE LD. CIT(A) HAS ERRED IN LAW AS WELL AS ON TH E FACTS OF THE CASE IN SUSTAINING THE ADDITION OF RS. 25,20 0/- OUT OF RS. 37,800/- ON ACCOUNT OF RENTAL INCOME, WITHOUT ANY BASIS AN D EVIDENCE. HENCE, THE ADDITION SO MADE BY THE AO AND PARTLY CONFIRMED BY THE LD. CIT(A) IS CONTRARY TO THE PROVISIONS OF LAW AND FACTS. HEN CE, THE SAME MAY KINDLY BE DELETED IN FULL. 4. THE AO ERRED IN LAW AS WELL AS ON THE FACTS OF T HE CASE IN CHARGING OF INTEREST U/S 234B, 234C & 234D AS CO NSEQUENTIAL IN NATURE. THE APPELLANT TOTALLY DENIES ITS LIABILITY OF CHARGING OF ANY SUCH INTEREST. HENCE THE INTEREST SO CHARGED BEING CONTR ARY TO THE PROVISIONS OF LAW AND FACTS, MAY KINDLY BE DELETED IN FULL. 2.1 BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE I S AN INDIVIDUAL. THE ASSESSEE HAS SUBMITTED HIS RETURN OF INCOME IN ITR -2 AND NO BUSINESS INCOME WAS DECLARED. THE ASSESSEE DEPOSITED CASH OF RS. 10,21,500/- IN THE BANK ACCOUNT HELD WITH HDFC BANK, KOTA. THIS IN FORMATION WAS RECEIVED BY THE AO THROUGH AIR AND AFTER RECORDING REASONS NOTICE U/S 148 OF THE ACT WAS ISSUED AND SERVED ON THE ASSESSE E. AFTER HEARING BOTH THE PARTIES AND PERUSING THE MATERIALS AVAILABLE ON RECORD, I FIND NO MERIT IN THE ARGUMENTS ADVANCED BY THE LD. AR AT THE TIME OF HEARING THE ITA NO. 412/JP/2016 SHRI RAJENDRA BATHLA VS. ITO, WARD- 1(1), KOTA . 3 APPEAL ON THE GROUND OF CHALLENGING THE VALIDITY OF NOTICE U/S 148 OF THE ACT. HENCE, THE GROUND NO. 1 AND 1.1 OF THE ASSESS EE ARE DISMISSED. 3.1 THE GROUND NO. 2 OF THE ASSESSEE RELATES TO SUS TAINING THE ADDITION OF RS. 3,71,898/- BY THE LD. CIT(A) OUT OF TOTAL AD DITION OF RS. 10,21,500/- ON ACCOUNT OF CASH DEPOSITS IN THE BANK ACCOUNT BY TAKING THE PEAK CREDIT. 3.2 I HAVE HEARD BOTH SIDE ON THIS ISSUE. AFTER HE ARING AND PERUSING THE MATERIALS AVAILABLE ON RECORD, IT IS NOTICED THAT THERE WAS OPENING BALANCE OF RS. 3,69,717.35 IN ACCOUNT BUT ON PERUSAL OF TH E BANK STATEMENT PLACED AT PAGES 1 AND 2 OF THE PAPER BOOK OF THE ASSESSEE, IT IS NOTICED THAT THE AMOUNT HAS BEEN TRANSFERRED BY CHEQUES FOR ANY OTHE R PURPOSES. THERE WERE CASH WITHDRAWALS OF RS. 10,000/- ON 17-04-200 6, RS.10,000/- ON 22-04-2006, AND RS. 4,000/- ON 26-04-2006 ONLY. FUR THER ACCOUNTS OF THE ASSESSEE REVEALS THAT THERE WERE CASH DEPOSITS OF R S. 49,500/- ON 27-04- 2006, RS. 48,000/- ON 28-04-2006 AND RS. 49,500/- ON 29-04-2006. THUS THE CASH DEPOSITS IN THE BANK ACCOUNT OF THE ASSESS EE ON THE ABOVE DATES WAS NOT DEFINITELY OUT OF WITHDRAWALS. FURTHER IT IS ALSO NOTICED THAT THERE WERE CASH DEPOSITS OF RS. 49,500/- ON 19-05-2006 AN D RS.49,000/- ON 20- 05-2006 AND THERE WAS NO CASH WITHDRAWAL PRIOR TO T HESE DEPOSITS. SIMILAR TREND WAS ALSO FOUND IN THE MONTH OF MAY 2006 WHERE THE AMOUNT HAS ITA NO. 412/JP/2016 SHRI RAJENDRA BATHLA VS. ITO, WARD- 1(1), KOTA . 4 BEEN TRANSFERRED BY CHEQUES AND THERE WERE ALSO VER Y FEW CASH WITHDRAWALS. IT IS ALSO NOTICED THAT THERE WERE CAS H DEPOSITS OF RS. 49,000/- EACH ON 19-06-2006 AND 20-06-2006 WHILE NO SUCH CASH WITHDRAWALS ARE THERE TO EXPLAIN THESE DEPOSITS. . ALL THESE FACTUAL ASPECTS REFLECT THAT THERE WAS NO SUFFICIENT CASH WITHDRAWA L TO EXPLAIN THE CASH DEPOSITS AND LD. CIT(A) WAS JUSTIFIED TO APPLY THE PEAK CREDIT THEORY. CONSIDERING ALL THESE ASPECTS OF THE CASE, I UPHOLD THE ADDITION OF RS. 3,71,898/- BEING THE PEAK CREDIT IN THE BANK AC COUNT OF THE ASSESSEE. FURTHER IT IS ALSO OBSERVED FROM RECORDS THAT THE ASSESSEE'S CLAIM REGARDING CREDITS IN HIS ACCOUNTS WERE OUT OF SALE OF KOTA STONE WAS WITHOUT ANY SUPPORTING EVIDENCE. THERE IS NOTHING O N RECORD TO JUSTIFY THE CONTENTION OF THE ASSESSEE. HENCE, THE ASSESSEE'S SUCH CONTENTIONS IN THIS REGARD IS ALSO NOT ACCEPTABLE. IN VIEW OF THE FACTS AND CIRCUMSTANCES OF THE CASE, I FIND NO REASON TO INTERFERE WITH THE OR DER OF THE LD. CIT(A) ON THIS ISSUE. THUS GROUND NO. 2 OF THE ASSESSEE IS DI SMISSED. 4.1 THE GROUND NO. 2 OF THE ASSESSEE IS REGARDING S USTAINING THE ADDITION OF RS. 25,200/- OUT OF RS. 37,800/- ON ACC OUNT OF RENTAL INCOME BY THE LD. CIT(A). IT IS NOTED FROM THE RECORDS THA T THE ASSESSEE HAS FILED ITA NO. 412/JP/2016 SHRI RAJENDRA BATHLA VS. ITO, WARD- 1(1), KOTA . 5 AN APPLICATION DATED 28-10-2016 WITH THE PRAYER TO ADMIT THE ADDITIONAL EVIDENCE ON RECORD U/S 29 OF ITAT RULES. 4.2 AFTER HEARING BOTH THE PARTIES AND PERUSING THE MATERIALS AVAILABLE ON RECORD, IT IS NOTICED THAT THIS EVIDENCE IS A RE GISTERED DOCUMENT WITH THE SUB-REGISTRAR REGARDING RELEASE DEED BY SHRI R AJENDRA KUMAR BATHLA. THEREFORE, THIS EVIDENCE FILED BY THE ASSES SEE IS ADMITTED. FURTHER THE LD. AR OF THE ASSESSEE TO THIS EFFECT THROUGH H IS WRITTEN SUBMISSION PRAYED AS UNDER:- THE CORRECT FACTS OF THE CASE ARE THAT THE SHOPS WERE ACQUIRED BY THE FATHER OF THE ASSESSEE NAMELY SHRI VAZIR CHAND BATH LA IN THE NAME OF THE ASSESSEE AND HIS BROTHER SHRI NARENDRA BATHLA AND T HE HOUSE WAS PURCHASED JOINTLY WITH HIS BROTHER SHRI NARENDRA BATHLA. THER EAFTER THE ASSESSEE HAS MADE RELEASE DEED OF SHOP IN THE NAME OF HIS BROTHE R ON 27-01-2006 AND ALSO MADE A HAQ TYAG PATRA OF HOUSE IN THE NAME OF HIS B ROTHER ON 17-08-2006. ALTHOUGH THE SAME HAS BEEN DONE IN EARLIER YEARS BU T ON RECORD THE SAME HAS BEEN DONE ON 27-01-2006 AND 17-08-2006. THUS THE A SSESSEE WAS NOT HAVING ANY RIGHT OR POSSESSION ON THE ABOVE PROPERTY THERE AFTER. THEREFORE, THE SECTION 23(1)(A) IS NOT APPLICABLE IN THE PRESENT CASE. FOR SUPPORT WE ARE ENCLOSING HEREWITH THE COPIES OF BOTH DOCUMENTS. WE HEREBY ST ATED THAT THE ABOVE DOCUMENTS WERE NOT FURNISHED BEFORE THE LOWER AUTHO RITIES. HENCE THE SAME MAY KINDLY BE ADMITTED U/R 29 OF THE ITAT IN THE IN TEREST OF NATURAL JUSTICE BECAUSE THE SAME GOES IN THE ROOT OF MATTER. LOOKING INTO ENTIRETY OF THE FACTS AND CIRCUMSTANCE S OF THE CASE, IT WILL BE IN THE INTEREST OF JUSTICE TO RESTORE THE ISSUE OF RENTAL INCOME TO THE FILE OF THE AO TO DECIDE IT AFRESH BY PROVIDING REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. THE ASSESSEE IS DIRECTED TO SUBMIT THE RELEVANT ITA NO. 412/JP/2016 SHRI RAJENDRA BATHLA VS. ITO, WARD- 1(1), KOTA . 6 DOCUMENTS BEFORE THE AO TO DECIDE THE ISSUE IN QUES TION. THUS GROUND NO. 2 OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PU RPOSES. 5.1 THE GROUND NO. 3 OF THE ASSESSEE IS REGARDING C HARGING OF INTEREST U/S 234B, 234C AND 234D WHICH IS MANDATORY IN CONSE QUENTIAL IN NATURE. 6.0 IN THE RESULT, THE APPEAL OF THE ASSESSEE IS P ARTLY ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 02 /12/2 016 SD/- HKKXPUN ( BHAGCHAND) YS[KK LNL;@ ACCOUNTANT MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 02 /12/ 2016 *MISHRA VKNS'K DH IZFRFYFI VXZSF'KR@ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ@ THE APPELLANT- SHRI RAJENDRA BATHLA, KOTA 2. IZR;FKHZ@ THE RESPONDENT- THE ITO, WARD- 1(1), KOTA 3. VK;DJ VK;QDRVIHY@ CIT(A). 4. VK;DJ VK;QDR@ CIT, 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ@ DR, ITAT, JAIPUR 6. XKMZ QKBZY@ GUARD FILE (ITA NO. 412/JP/2016) VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ @ ASSISTANT. REGISTRAR