Balraj Singh, Meerut V. ITO, Ward- 1(2), Meerut

ITA 416/DEL/2019

• Counselvise Citation: [2019] 112 COUNSELVISE.COM (IT) 1802 (ITAT-DELHI)
• Duration Of Justice: 8 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-10-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2010-2011
• Appeal Filed On: 21-01-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S L ANURAGI
• Assessee Lawyers: CHANDER MEHRA
• Keywords: Income from undisclosed sources; Assessment record
• Section: 147

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH F NEW DELHI BEFORE SHRI AMIT SHUKLA, JUDICIAL MEMBER AND SHRI PRASHANT MAHARISHI, ACCOUNTANT MEMBER I.T.A. NO.416/DEL/2019 ASSESSMENT YEAR: 2010-11 BALRAJ SINGH, C/O MEHRA& CO, CAS, 7, RAJESHWARI PALACE, CIVIL LINES, MEERUT. VS. ITO, WARD-1(2), MEERUT. TAN/PAN: BDBPS 0010H (APPELLANT) (RESPONDENT) APPELLANT BY: SHRI CHANDER MEHRA, FCA RESPONDENT BY: SHRI S.L. ANURAGI, SR.D.R. DATE OF HEARING: 23 07 2019 DATE OF PRONOUNCEMENT: 18 10 2019 O R D E R PER AMIT SHUKLA, JM THE AFORESAID APPEAL HAS BEEN FILED BY THE ASSESSEE AGAINST THE IMPUGNED ORDER DATED 26.11.2018, PASSED BY COMMISSIONER OF INCOME TAX (APPEALS), MEERUT FOR TH E QUANTUM OF ASSESSMENT PASSED U/S.144 FOR THE ASSESS MENT YEAR 2010-11. THE ASSESSEE IS AGGRIEVED BY ADDITION OF RS.23,26,060/- ON ACCOUNT OF CASH DEPOSITS IN SAVIN GS BANK ACCOUNT. 2. THE FACTS IN BRIEF ARE THAT AN AIR INFORMATION WAS RECEIVED FROM CIB, KANPUR THAT THE ASSESSEE HAD DEP OSITED CASH OF RS.40,65,117/- IN HIS SAVINGS BANK ACCOUNT WITH I.T.A. NO.416/DEL/2019 2 UNION BANK OF INDIA DURING FINANCIAL YEAR 2009-10. SINCE SOURCE OF CASH DEPOSITS WAS NOT EXPLAINED IN RESPON SE TO THE QUERY LETTER DATED 04.01.2017 AND THE PAN AND ITR O F THE ASSESSEE WAS ALSO NOT AVAILABLE, THEREFORE, PRIMA FACIE BELIEVE WAS ENTERTAINED U/S 147 THAT CASH DEPOSITED BY THE ASSESSEE WAS OUT OF INCOME FROM UNDISCLOSED SOURCES. ACCORDI NGLY, NOTICE U/S.148 WAS ISSUED ON 21.03.2017. HOWEVER, A S PER THE ASSESSMENT ORDER, IN RESPONSE TO SUCH NOTICE NO COMPLIANCE WAS MADE NEITHER ANY OF THE OTHER STATUT ORY NOTICES WAS COMPLIED WITH. FINALLY, NOTICE ISSUED U /S.144 FOR PASSING THE BEST JUDGMENT ASSESSMENT NOT COMPLIED WI TH. ACCORDINGLY, ASSESSING OFFICER ADDED THE ENTIRE AMO UNT OF RS.40,65,117/- U/S.68. 3. BEFORE THE LD. CIT(A), THE ASSESSEE HAD FILED AD DITIONAL EVIDENCES IN THE FORM OF PAN, ADDRESS OF THE ASSESS EE, COPY OF AGRICULTURAL HOLDINGS, COPY OF AFFIDAVITS OF BROTHE RS OF THE ASSESSEE, SHRI BALRAJ SINGH AND SHRI RAGHURAJ SINGH A LONG WITH COPY OF TAX AUDIT REPORT, ITR V AND COMPUTATIO N OF INCOME OF SHRI RAGHURAJ SINGH, STATING THAT THESE WE RE THE TOLL RECEIPTS FROM THE BUSINESS OF HIS BROTHER, SHR I RAGHURAJ SINGH, COPY OF SECURITY DEPOSIT OF EXECUTIVE ENGINE ER, NATIONAL HIGHWAY, PWD, GHAZIABAD AND CATENA OF PREC EDENCE WERE ALSO FILED TO PROVE THAT THE MONEY DEPOSITED B ELONGED TO HIS BROTHER OUT OF TOLL COLLECTION BUSINESS. ALL TH ESE EVIDENCES WERE FORWARDED TO THE ASSESSING OFFICER ALONG WITH APPLICATION UNDER RULE 46A. LD. ASSESSING OFFICER HAS GIVEN HIS REMAND REPORT WHICH HAS BEEN INCORPORATED IN THE IMPUGNED I.T.A. NO.416/DEL/2019 3 APPELLATE ORDER AT PAGES 3 TO 5. IN RESPONSE TO THE SAID REMAND REPORT, ASSESSEE HAS ALSO FILED HIS REBUTTAL . 4. LD. CIT (A) THOUGH ADMITTED THE ADDITIONAL EVIDE NCES BUT DISBELIEVED THE CONTENTION THAT YOUNGER BROTHER OF THE ASSESSEE HAD DEPOSITED THE CASH IN HIS SAVINGS BANK ACCOUNT EARNED OUT OF HIS BUSINESS FROM OPERATING A TOLL CO LLECTION OF POINT OF PWD ON NATIONAL HIGHWAY DIVISION AFTER OBS ERVING AND HOLDING AS UNDER: I) THE SECURITY DEPOSIT OF RS.13,00,000/- LACS CLAI MED TO BE DEPOSITED WITH THE PWD DEPARTMENT IN NOT APPEARING IN THE BALANCE SHEET OF RAGURAJ SINGH FOR A.Y 2010-11 . II) THE TOTAL COLLECTION FROM TOLL PLAZA IS OF RS. 1,41,83,370/- FOR THE YEAR ENDING 31.03.2010 ON WHIC H PROFIT OF RS.1,48,394/- HAS BEEN DECLARED. THE BANK ACCOUNT IN WHICH IT IS CLAIMED THAT CASH WAS DEPOSITED IS NOT APPEARING IN THE BALANCE SHEET OF RAGURAJ SINGH. III) THE CASH OF RS.40,65,117/- HAS BEEN ALLEGED TO BE DEPOSITED OUT OF TOLL RECEIPTS OF RS.1,41,83,370/- ON W HICH A SUM OF RS.1,48,394/- WAS DECLARED AS INCOME AND RS. 1,27,53.000/- WAS PAID AS TOLL CHARGES PAID TO PWD DEPARTMENT . SO HOW A.R CAN JUSTIFY THE DEPOSIT OF CASH OF RS.40,65,117/- OUT OF TOLL COLLECTION IS NOT ONLY MATHEMATICALLY INCORRECT BUT ALSO A BLATANT LIE ON AFFIDA VIT. IN THE LETTERS DATED 03.10.2018 & 11.10.2018 THE APPEL LANT IS NEEDLESSLY EMPHASIZING THE OMISSIONS ON THE PART OF THE AO AND THE LACK OF OPPORTUNITY BEFORE THE AO. THE FAC T OF THE MATTER IS THAT APPEAL PROCEEDINGS ARE A CONTINUATION OF I.T.A. NO.416/DEL/2019 4 ASSESSMENT PROCEEDINGS AND IF INDEED THE AR OR THE APPELLANT WANTED TO FILE ANY CREDIBLE EVIDENCE REGARDI NG SOURCE OF CASH DEPOSIT THEY COULD HAVE DONE THE SAME BEFORE THE UNDERSIGNED. BY MERELY STATING THAT CASH BELONGS TO AND HAS BEEN TAX ED IN THE HANDS OF RAGHURAJ SINGH IS NOTHING BUT A SELF SER VING ARGUMENT WHICH HAS NOT BEEN PROVED BY SUPPORTING EVID ENCE THAT IT IS INDEED SO DESPITE NUMEROUS OPPORTUNITIES GIVE N IN APPEAL. BY MERELY LAYING THE BLAME ON AO THE APPELLANT CANNOT GET AWAY WITH HIS RESPONSIBILITY TO FURNISH CREDIBLE CORR OBORATIVE EVIDENCE THAT INDEED THE MONEY DEPOSITED IN THE APPELLAN T'S ACCOUNT ACTUALLY BELONGED TO THE TOLL BUSINESS BEING R UN BY THE BROTHER OF THE ASSESSEE. A PRIMA FACIE VIEW OF THE CASH AVAILABILITY AND THE CASH FLOW WHICH HAS BEEN DISCU SSED HEREIN IN THE OPENING LINES OF THIS PARA (III) GOES TO PROVE THAT THE WHOLE ARGUMENT IS NOTHING BUT AN AFTERTHOUGHT CONCEIVED TO CONFUSE AND MISLEAD APPELLATE AUTHORITY. IV) THERE IS NO MERIT IN THE SUBMISSIONS OF ASSESSEE AND DURING APPELLATE PROCEEDINGS NOTHING ON THE MERITS OF TH E CASE HAS BEEN ARGUED AND A.R HAS TRIED TO MISLEAD THE PROCEEDINGS BY FILING FALSE AFFIDAVITS WITHOUT REALIZ ING THE CONSEQUENCES OF THE SAME. THUS, THERE IS NO MERIT IN THE APPEAL FILED BY THE APPE LLANT AND THE A.O HAS CORRECTLY MADE ADDITION OF RS. 40,65, 117/- AS NEITHER IN ASSESSMENT PROCEEDINGS NOR IN APPELLATE I.T.A. NO.416/DEL/2019 5 PROCEEDINGS ANY CREDIBLE DOCUMENT/EVIDENCE TO PROVE TH E SOURCE OF SUCH DEPOSITS HAS BEEN FILED. 5. BEFORE US, LD. COUNSEL FOR THE ASSESSEE ON MERIT S OF THE CASE SUBMITTED THAT THE ASSESSEES BROTHER WAS GIVE N A CONTRACT FOR TOLL COLLECTION FROM NATIONAL HIGHWAY DIVISION, PWD, GHAZIABAD. TOTAL TOLL COLLECTION DISCLOSED IN THE P&L ACCOUNT AND BALANCE-SHEET OF SHRI RAGHURAJ SINGH WAS RS.1,41,83,370/- FROM WHICH RS.1,48,394/- WAS DECLA RED AS INCOME. ALL THESE FIGURES ARE APPEARING IN THE AUDI TED P&L ACCOUNT. THE RECEIPT OF RS.40,65,117/- WERE DEPOSIT ED IN THE BANK ACCOUNT WHEREIN ALL THE BROTHERS OF THE ASSESS EE AND HIS NEPHEW WERE THE JOINT HOLDERS WHICH WAS OPENED AS SA VINGS BANK ACCOUNT IN EARLY 1990. THE TOTAL TOLL CHARGES DEPOSITED, OTHER EXPENSES INCLUDING SECURITY DEPOSITED AND ADJ USTED HAVE BEEN MERGED WITH THE TOLL RECEIVED AND PAID. T HE SAVINGS BANK ACCOUNT HAS BEEN MERGED WITH THE UNION BANK OPERATED LATER ON. HE ALSO DREW OUR ATTENTION TO TH E DAY TO DAY CASH DEPOSITS OF RS.40,65,117/- WHICH ARE APPEARING AT PAGES 29 TO 30 OF THE APPELLATE ORDER. HE POINTED OUT THA T THE DETAILS OF CASH DEPOSITS ALSO INCLUDES THE COPY OF BANK ACC OUNT IN WHICH CASH WAS DEPOSITED AND ALL THESE ARE DULY VER IFIABLE ON THE ENTRIES IN THE BOOKS OF ACCOUNT. THUS, ALL THES E FACTS HAVE NOT BEEN PROPERLY APPRECIATED, AND THEREFORE, MATTE R NEEDS TO BE RE-EXAMINED. ACCORDINGLY, THIS ISSUE SHOULD BE R EMANDED BACK TO THE FILE OF THE ASSESSING OFFICER TO EXAMIN E THE ISSUE OF CASH DEPOSITS ON THE BASIS OF MATERIAL EVIDENCE PRODUCED DURING THE COURSE OF APPELLATE PROCEEDINGS INCLUDIN G THE I.T.A. NO.416/DEL/2019 6 BOOKS OF ACCOUNT AND BANK DETAILS OF SHRI RAGHURAJ S INGH, BROTHER OF THE ASSESSEE. 6. ON THE OTHER HAND, LD. DR REFERRED TO THE VARIOU S OBSERVATIONS MADE BY THE LD. CIT (A) IN HIS ORDERS AS WELL AS THE REMAND REPORT SUBMITTED BY THE ASSESSING OFFICE R. 7. AFTER CONSIDERING THE RIVAL SUBMISSIONS AND ON P ERUSAL OF THE RELEVANT FINDINGS GIVEN IN THE IMPUGNED ORDE RS, WE FIND THAT IT IS AN UNDISPUTED FACT THAT THE ONLY SOURCE OF INCOME WHICH ASSESSEE IS HAVING IS FROM AGRICULTURAL OPERA TIONS. THE BANK ACCOUNT IN WHICH AMOUNT HAS BEEN FOUND TO BE DEPOSITED HAS BEEN STATED TO BE OPENED BY THE ASSES SEE ALONG WITH YOUNGER BROTHERS AND HIS NEPHEW. FURTHER, BEFO RE THE LD. CIT (A) ASSESSEE HAS FILED VARIOUS ADDITIONAL E VIDENCES TO DEMONSTRATE THAT HIS YOUNGER BROTHER, SHRI RAGHURAJ SINGH WAS AWARDED A CONTRACT FROM NHAI, PWD, GHAZIABAD FO R THE AREA. SINCE, THE ENTIRE TOLL WAS RECEIVED IN CASH, THEREFORE, SAME WERE DEPOSITED IN THE COMMON SAVINGS BANK ACCO UNT. THESE TOLL RECEIPTS HAVE BEEN STATED TO BE DECLARED BY SHRI RAGHURAJ SINGH IN HIS AUDITED ACCOUNT AND INCOME TAX RETURN WHEREIN THE ENTIRE TOLL RECEIPTS HAVE BEEN DECLARED ALONG WITH TOLL RECEIPTS DEPOSITED TO THE GOVERNMENT ACCOUNT A ND VARIOUS OTHER EXPENSES. THE TOLL CHARGES RECEIVED H AVE BEEN STATED TO BE RS.1,41,83,370/- AND AFTER DEDUCTING V ARIOUS EXPENSES, THE TOLL CHARGES PAID WAS RS.1,27,53,000/ -. THE NET PROFIT DERIVES FROM SUCH BUSINESS BY SHRI RAGHU RAJ SINGH WAS RS.1,48,394/-. ONCE ASSESSEE HAD NO OTHER SOURC E OF I.T.A. NO.416/DEL/2019 7 INCOME OTHER THAN AGRICULTURE INCOME AND THE BANK A CCOUNT DOES NOT BELONG ALONE TO THE ASSESSEE, THEN THE EXP LANATION GIVEN THAT THE CASH DEPOSIT COULD BE OUT OF THE TOL L RECEIVED BUSINESS OF THE ASSESSEE BROTHER, SHRI RAGHURAJ SING H CANNOT BE SIMPLY BRUSHED ASIDE. THE REASONS CITED BY THE L D. CIT(A) FOR REJECTING THE ASSESSEES EXPLANATION IS NOT BAS ED ON CORRECT APPRECIATION OF FACTS PUT UP BEFORE HIM NOR HE HAS TRIED TO ANALYZE DAY TO DAY CASH DEPOSITS IN THE BANK ACCOUN T, VIS-A- VIS THE BOOKS OF ACCOUNT MAINTAINED BY SHRI RAGHURA J SINGH WHICH WAS SUBJECT TO AUDIT ALSO. UNDER THESE FACTS AND CIRCUMSTANCES OF THE CASE AND IN THE INTEREST OF JU STICE, WE ARE REMANDING THIS MATTER TO THE FILE OF THE ASSESS ING OFFICER TO EXAMINE ALL THE EVIDENCES AND TO VERIFY THE CASH DEPOSITS FROM THE ASSESSMENT RECORDS AND THE BOOKS OF ACCOUN T OF SHRI RAGHURAJ SINGH. THE LD. ASSESSING OFFICER SHALL PROV IDE DUE AND EFFECTIVE OPPORTUNITY OF HEARING TO THE ASSESSE E TO SUBSTANTIATE HIS CASE AND ASSESSEE IS ALSO DIRECTED TO CO- OPERATE WITH THE ASSESSING OFFICER. 8. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 18 TH OCTOBER, 2019. SD/- SD/- [PRASHANT MAHARISHI] [AMIT SHUKLA] [ACCOUNTANT MEMBER] JUDICIAL MEMBER DATED: 18 TH OCTOBER, 2019