Rekha Kushwaha, Haridwar V. ITO, Ward- 2, Haridwar

ITA 4245/DEL/2017

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 3585 (ITAT-DELHI)
• Duration Of Justice: 7 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 01-02-2018
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: SMC
• Assessment Year: 2011-2012
• Appeal Filed On: 27-06-2017
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: KAUSHLENDRA TIWARI
• Keywords: Business income
• Section: 133(6); 11

Judgement Text

1 ITA.NO.4245/DEL./2017 SMT. REKHA KUSHWAHA, MAYAPUR, HARIDWAR. IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES SMC : DELHI BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER ITA.NO.4245/DEL./2017 ASSESSMENT YEAR 2011-2012 SMT. REKHA KUSHWAHA C/O. BALESH BHARGAVA, ADVOCATE, 56, NIRANAJANI AKHARA, MAYAPUR, HARIDWAR -249401 PAN AHAPR0408A VS. THE INCOME TAX OFFICER, WARD-2, HARIDWAR. (APPELLANT) (RESPONDENT) FOR ASSESSEE : -NONE- (WRITTEN SUBMISSIONS RECEIVED BY DAK) FOR REVENUE : SHRI KAUSHLENDRA TIWARI, SR. D.R. DATE OF HEARING : 23.01.2018 DATE OF PRONOUNCEMENT : 01.02.2018 ORDER THIS APPEAL BY ASSESSEE HAS BEEN DIRECTED AGAINST THE ORDER OF THE LD. CIT(A), MUZAFFARNAGAR, DATED 2 0 TH MARCH, 2017, FOR THE A.Y. 2011-2012. 2. NONE APPEARED ON BEHALF OF THE ASSESSEE DESPITE SERVICE OF NOTICE. THE ASSESSEE HAS, HOWEVER, FORWA RDED WRITTEN SUBMISSIONS WITH DOCUMENTS THROUGH POST AND REQUEST ED THAT APPEAL MAY BE DECIDED ON THE BASIS OF THE WRITTEN S UBMISSIONS OF THE ASSESSEE. 2 ITA.NO.4245/DEL./2017 SMT. REKHA KUSHWAHA, MAYAPUR, HARIDWAR. 3. I HAVE HEARD THE LD. D.R. AND PERUSED THE MATER IAL ON RECORD. THE WRITTEN SUBMISSIONS OF THE ASSESSEE ARE ALSO TAKEN INTO CONSIDERATION. 4. ACCORDING TO THE OFFICE, THE APPEAL IS TIME BAR RED BY 04 DAYS. HOWEVER, THE RECORD REVEALS THAT ASSESSEE FILED THE APPEAL THROUGH REGISTERED POST ON 20 TH JUNE, 2017 WHICH WAS RECEIVED IN THE O/O.THE TRIBUNAL ON 27 TH JUNE, 2017. THE ASSESSEE ALSO FILED APPLICATION FOR CONDONATION OF DELAY. THE EXPLANATION OF THE ASSESSEE WAS THAT APPEAL IS DISP ATCHED THROUGH POST WITHIN TIME AND PLEADED THAT THE NOMIN AL DELAY OF 04 DAYS IN FILING THE APPEAL, BE CONDONED. IN VIEW OF THESE FACTS AND EXPLANATION OF ASSESSEE, DELAY IN FILING APPEAL IS CONDONED. 5. ON GROUND NO.1, ASSESSEE CHALLENGED THE ORDER O F THE AUTHORITY BELOW CONTENDING THAT NO PROPER OPPORTUNI TY OF BEING HEARD PROVIDED TO HER COUNSEL BECAUSE OF HIS ILLNES S. HOWEVER, THE IMPUGNED ORDER SHOWS THAT IN RESPONSE TO THE NO TICE OF THE LD. CIT(A), THE LEARNED COUNSEL FOR THE ASSESSEE, A PPEARED BEFORE HIM AND FILED THE WRITTEN SUBMISSIONS AND HE ARGUED THE APPEAL. IN THE WRITTEN SUBMISSIONS NO SUCH POINT HA S BEEN 3 ITA.NO.4245/DEL./2017 SMT. REKHA KUSHWAHA, MAYAPUR, HARIDWAR. RAISED. THEREFORE, IT IS CLEAR THAT PROPER OPPORTUN ITY HAS BEEN GIVEN BY LD. CIT(A) BEFORE PASSING THE APPELLATE OR DER. GROUND NO.1 OF THE APPEAL OF ASSESSEE IS DISMISSED. 6. ON GROUND NO.2, ASSESSEE CHALLENGED THE ADDITIO N OF RS.5,25,566. AS PER AUDITED REPORT, ASSESSEE IS ENG AGED IN THE BUSINESS OF DISTRIBUTION, RETAILING AND SERVICES OF COMPUTERS. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, ASSESS EE PRODUCED ONLY CASH BOOK, BANK BOOK AND LEDGER. HOWE VER, NO VAT CHALLANS, BILLS AND VOUCHERS HAVE BEEN PRODUCED . THE A.O, THEREFORE, DIRECTED THE ASSESSEE AS TO WHY THE AUDI TED REPORT FILED, MAY NOT BE REJECTED AND NET PROFIT FROM COMP UTER BUSINESS MAY NOT BE CALCULATED AFTER APPLYING PROFIT RATE OF 5% SO AS TO MAKE ADDITION OF RS.15,57,532. 6.1. THE ASSESSEE SUBMITTED BEFORE A.O. THAT IN TH E CASE OF HER HUSBAND SHRI VIJAY KUMAR KUSHWAHA (DURING 20 06- 2007) IN HIS SCRUTINY CASE OF M/S. COMPUTER MART, T HE LD. CIT(A), DEHRADUN, APPLIED RATE OF INTEREST OF 2.50% . IT WAS, THEREFORE, PLEADED THAT IN THE CASE OF THE ASSESSEE , SAME RATE OF INTEREST OF 2.50% MAY BE APPLIED INSTEAD OF 5% AS P ROPOSED IN 4 ITA.NO.4245/DEL./2017 SMT. REKHA KUSHWAHA, MAYAPUR, HARIDWAR. THE NOTICE. THE A.O. ACCEPTED THE SUBMISSIONS OF TH E ASSESSEE AND APPLIED NET PROFIT RATE OF 2.50% ON TOTAL SALES DECLARED BY ASSESSEE AND MADE THE ADDITION OF RS.5,25,566. 6.2. IT WAS SUBMITTED BEFORE LD. CIT(A) THAT IN TH E CASE OF SHRI VIJAY KUMAR KUSHWAHA FOR A.Y. 2006-2007, THE G ROSS PROFIT RATE WAS DECLARED AT 6.69% AND NET PROFIT @ 2.12% AND THE LD. CIT(A) REDUCED THE ADDITION TO RS.50,000. S INCE THE A.O. HAS NOT POINTED OUT ANY MAJOR DEFECT, THEREFORE, AD DITION MAY BE DELETED. THE LD. CIT(A) DID NOT ACCEPT THE CONTE NTION OF THE ASSESSEE BECAUSE THE ASSESSEE DID NOT PRODUCE BILLS AND VOUCHERS EVEN DURING THE COURSE OF APPELLATE PROCEE DINGS. THEREFORE, THE LD. CIT(A) REJECTED THE BOOKS OF ACC OUNT UNDER SECTION 145(3) OF THE I.T. ACT. IT WAS ALSO NOTED T HAT IN THE CASE OF SHRI VIJAY KUMAR KUSHWAHA THE GP RATE @ 6.69% AN D NP RATE @ 2.12% ON TURNOVER OF RS.3.42 CRORES AS AGAIN ST GP ON RS.3.18 CRORES, NP @ 2.10% ON TURNOVER OF RS.4.12 C RORES BY THE ASSESSEE. THE APPEAL OF ASSESSEE ON THIS GROUND WAS ACCORDINGLY DISMISSED. THE ASSESSEE IN THE WRITTEN SUBMISSIONS REITERATED THE SAME FACTS. 5 ITA.NO.4245/DEL./2017 SMT. REKHA KUSHWAHA, MAYAPUR, HARIDWAR. 7. CONSIDERING THE FACTS OF THE CASE IN THE LIGHT OF FINDINGS OF THE AUTHORITIES BELOW, IT IS CLEAR THAT ASSESSEE DID NOT PRODUCE BILLS AND VOUCHERS IN SUPPORT OF THE BOOKS OF ACCOUNT, THEREFORE, SAME WAS REJECTED UNDER SECTION 145(3) O F THE I.T. ACT WHICH IS ALSO NOT IN CHALLENGE BEFORE THE TRIBUNAL. FURTHER, THE ASSESSEE HAS MADE STATEMENT BEFORE A.O. THAT INSTEA D OF PROPOSED NP RATE OF 5%, NP RATE OF 2.50% MAY BE APP LIED FOR MAKING THE ADDITION. IT IS WELL SETTLED LAW THAT AD DITION MADE ON ADMISSION OF THE ASSESSEE WOULD NOT BE SUBJECT T O CHALLENGE IN APPEAL. SINCE ASSESSEE AGREED FOR ADDITION BY AP PLYING NET PROFIT RATE OF 2.50% AS IS APPLIED IN THE CASE OF H ER HUSBAND, THEREFORE, THERE IS NOTHING WRONG IN THE ORDERS OF THE AUTHORITIES BELOW IN MAKING AND CONFIRMING THE ADDITION. GROUND NO.2 OF APPEAL OF ASSESSEE IS DISMISSED. 8. ON GROUND NO.3, ASSESSEE CHALLENGED THE ADDITIO N OF RS.89,000 ON ACCOUNT OF UNEXPLAINED DEPOSIT IN THE BANK ACCOUNT. ON GROUND NO.4, ASSESSEE CHALLENGED ADDITI ON OF RS.12,50,000 ON ACCOUNT OF FDRS AND ON GROUND NO.5, ASSESSEE CHALLENGED THE ADDITION OF RS.3,728 ON ACCOUNT OF I NTEREST ON 6 ITA.NO.4245/DEL./2017 SMT. REKHA KUSHWAHA, MAYAPUR, HARIDWAR. THE SAID FDRS. ALL THESE THREE GROUNDS ARE SAME. TH EREFORE, DECIDED TOGETHER. 9. THE A.O. ISSUED NOTICE UNDER SECTION 133(6) OF THE I.T. ACT, 1961 TO THE BRANCH MANAGER, SOUTH INDIA BANK L TD., DEHRADUN TO PROVIDE CERTIFIED COPIES OF THE SB A/C AND CASH CREDIT LIMIT OF THE ASSESSEE FOR THE YEAR UNDER CON SIDERATION. THE BANK MANAGER FURNISHED COPIES OF THE STATEMENTS OF THE FOLLOWING BANK ACCOUNTS. (I) CASH CREDIT ACCOUNT COPY OF U.K. I.T. SERVICE AND TRADING COMPANY A/C. NO.0471083000000009 (II) ACCOUNT COPY OF MRS. REKHA KUSHWAHA (ASSESSEE) A/C.NO. 0471053000001220 (III) ACCOUNT COPY OF MR. VIJAY KUSHWAHA AND MRS. REKHA KUSHWAHA JOINT A/C. NO.0471053000001241. 9.1. ON PERUSAL OF THE CASH CREDIT ACCOUNT FROM TH E COPY OF M/S. UTTARAKHAND I.T. SERVICES AND TRADING COMPA NY A/C. NO.XXX09, IT WAS FOUND THAT ASSESSEE HAS NOT SHOWN THIS ACCOUNT IN HER BALANCE SHEET AND HAS DEPOSITED CASH ON DIFFERENT DATES AMOUNTING TO RS.89,000. THE EXPLANA TION OF ASSESSEE WAS CALLED FOR, IN WHICH, SHE HAS EXPLAINE D THAT THIS 7 ITA.NO.4245/DEL./2017 SMT. REKHA KUSHWAHA, MAYAPUR, HARIDWAR. ACCOUNT DOES NOT PERTAIN TO THE ASSESSEE. RATHER CC.NO.04710800000010 IS HER PROPRIETARY-SHIP. THE SUBMISSION OF THE ASSESSEE WAS NOT ACCEPTED AND A.O . MADE ADDITION OF RS.89,000 ON ACCOUNT OF UNEXPLAINED CAS H DEPOSITED IN A/C.NO.XXX09. 9.2. FURTHER, NOTICE UNDER SECTION 133(6) OF THE A CT WAS ISSUED TO THE BRANCH MANAGER, ORIENTAL BANK OF COMM ERCE, HARIDWAR, TO PROVIDE DETAILS OF FDRS OF RS.70 LAKHS MADE BY ASSESSEE DURING THE YEAR. THE BRANCH MANAGER SUBMIT TED THE DETAILS. ON PERUSAL OF THE DETAILS OF FDRS A/C.NO.X XX5461, IT WAS FOUND THAT FDR OF RS.12.50 LAKHS WAS MADE ON 30 TH MARCH, 2011 AFTER WITHDRAWAL OF RS.12.50 LAKHS FROM ORIENT AL BANK OF COMMERCE LTD., C.C. LIMIT A/C.NO.XXX279 OF M/S. COM PUTER JUNCTION BUT FDR HAS BEEN SHOWN BY ASSESSEE IN THE BALANCE SHEET BUT LENDER IS NOT APPEARING IN BOOKS OF ASSES SEE. AS SOURCE OF THIS FDR TO RS.12.50 LAKHS WAS NOT RELATE D TO THE ASSESSEE. THEREFORE, EXPLANATION OF ASSESSEE WAS CA LLED FOR AS TO WHY IT MAY NOT BE TREATED AS INCOME FROM UNDISCLOSE D SOURCE OF THE ASSESSEE. THE ASSESSEE EXPLAINED THAT FDR OF RS .12.50 8 ITA.NO.4245/DEL./2017 SMT. REKHA KUSHWAHA, MAYAPUR, HARIDWAR. LAKHS WAS MADE IN CASH WHICH WAS AVAILABLE IN THE B OOKS OF ACCOUNT OF THE ASSESSEE. ASSESSEE ALSO EXPLAINED TH AT FDR OF RS.12.50 LAKHS HAS BEEN PREPARED BY M/S. COMPUTER J UNCTION (PROPRIETOR SHRI RANJIT KUMAR) BUT HAS NOT BEEN REF LECTED IN THE BOOKS OF ACCOUNT. THE A.O. DID NOT ACCEPT THE CONTE NTION OF ASSESSEE. THE LEDGER ACCOUNT OF THE ASSESSEE IN THE BOOKS OF ACCOUNT OF M/S. COMPUTER JUNCTION HAVE BEEN OBTAINE D UNDER SECTION 133(6) OF THE I.T. ACT FROM SHRI RANJIT KUM AR WHICH REVEALED THAT THERE IS NO ENTRY OF RS.12.50 LAKHS I N THE LEDGER. IN THE ABSENCE OF SATISFACTORY EXPLANATION OF ASSES SEE, A.O. MADE ADDITION OF RS.12,50,000. SIMILARLY, INTEREST ON THIS FDRS OF RS.3,728 WAS ADDED TO THE INCOME OF THE ASSESSEE . 10. THE ASSESSEE CHALLENGED ALL THE THREE ADDITION S BEFORE THE LD. CIT(A) AND IT WAS EXPLAINED THAT A/C. NO.XX X09 BELONGS TO THE HUSBAND OF THE ASSESSEE AND HER A/C. NO. IS XXX10. IT WAS A PROPRIETARY CONCERN OF M/S. VIJAY KUMAR KUSHWAHA WHICH WAS LATER ON CHANGED TO THE ASSESSEE IN THE NAME OF THE FIRM. THE BANK HAS SUPPLIED WRONG INFORMATION. THE DETAIL S FROM KYC MAY BE CALLED FOR FROM THE BANK TO CLARIFY THE POSITION AND 9 ITA.NO.4245/DEL./2017 SMT. REKHA KUSHWAHA, MAYAPUR, HARIDWAR. TO VERIFY WHO IS THE PROPRIETOR OF THIS ACCOUNT. SI MILARLY, AS REGARDS FDRS OF RS.12.50 LAKHS, IT WAS SUBMITTED TH AT FDR IS ALREADY DISCLOSED IN THE BALANCE SHEET OF THE ASSES SEE. THE FDR HAS BEEN PURCHASED OUT OF WITHDRAWAL FROM HER OD A/ C XXX631. THE FDRS HAS BEEN PURCHASED BY DEBITING ACCOUNT OF M/S. COMPUTER JUNCTION. IN FACT SHRI RAJ KUMAR IS ONE OF THE CLOSE ASSOCIATE OF THE ASSESSEE AND IT MIGHT BE POSSIBLE THAT HE MADE WITHDRAWAL OF THE SUM OF RS.12.50 LAKHS ON THE SAME DATE AND THROUGH OVERSIGHT IN THE FDR VOUCHERS, DETAILS OF C HEQUES HAD BEEN MENTIONED BY THE BANK BUT IT DID NOT MAKE ANY DIFFERENCE BECAUSE ASSESSEE HAD ALREADY DECLARED FDRS IN THE B OOKS OF ACCOUNT. THE ASSESSEE MADE FDRS OF THIS AMOUNT THRO UGH CASH AVAILABLE IN THE BOOKS OF ACCOUNT. IT WAS SUBMITTED THAT SINCE NO INTEREST ACCRUED IN ASSESSMENT YEAR UNDER APPEAL ON THE FDRS, THEREFORE, NO ADDITION IS REQUIRED. THE LD. C IT(A), HOWEVER, DID NOT INTERFERE WITH THE ORDER OF THE A. O. AND CONFIRMED ALL THE ADDITIONS. 11. AFTER CONSIDERING THE SUBMISSIONS OF THE LD. D .R. AND WRITTEN SUBMISSIONS OF THE ASSESSEE, I AM OF THE VI EW THAT ALL 10 ITA.NO.4245/DEL./2017 SMT. REKHA KUSHWAHA, MAYAPUR, HARIDWAR. THESE THREE GROUNDS REQUIRE RECONSIDERATION AT THE LEVEL OF THE A.O. THE ASSESSEE REITERATED THE SAME SUBMISSIONS I N THE WRITTEN SUBMISSIONS AND ALSO FILED COPY OF THE BANK A/C.NOS. XXX09 AND XXX10 AND STATED THAT THE BANK A/C IN QUE STION, FOR WHICH, ADDITION IS MADE RELATE TO SHRI VIJAY KUMAR KUSHWAHA. COPY OF THE SALES TAX REGISTRATION IS ALSO FILED. I T IS STATED IN THE WRITTEN SUBMISSIONS THAT WRONG INFORMATION HAVE BEE N SUPPLIED IN THE NAME OF THE FIRM WITHOUT GIVING DETAILS OF T HE PERSON WHO IS HOLDING THE ACCOUNT. IT IS ALSO SUBMITTED IN THE WRITTEN SUBMISSIONS THAT DISPUTE IS GOING ON BETWEEN THE AS SESSEE AND SOUTH INDIAN BANK. THEREFORE, WRONG INFORMATION HAV E BEEN PROVIDED. AS REGARDS FDRS OF RS.12.50 LAKHS, THE DE TAILS ARE ALSO FILED WITH THE WRITTEN SUBMISSIONS TO SHOW THA T FDRS OF RS.70 LAKHS WAS PURCHASED ON THREE DATES. COPY OF T HE AUDITED ACCOUNTS IS ALSO FILED TO SHOW THAT FDRS OF RS.70 L AKHS WITH ORIENTAL BANK OF COMMERCE HAVE BEEN DISCLOSED IN TH E BALANCE SHEET OF THE ASSESSEE. THE A.O. HOWEVER, MADE ONLY ADDITION OF RS.12.50 LAKHS. THE ASSESSEE EXPLAINED THAT DUE TO WRONG INFORMATION, THIS ADDITION HAVE BEEN MADE. IT IS AL SO EXPLAINED 11 ITA.NO.4245/DEL./2017 SMT. REKHA KUSHWAHA, MAYAPUR, HARIDWAR. THAT NO INTEREST ACCRUED ON THE FDRS. THESE FACTS A ND MATERIAL ON RECORD CLEARLY SHOW THAT THERE IS SOME SUBSTANCE IN THE SUBMISSIONS OF THE ASSESSEE WHICH REQUIRES RE-CONSI DERATION AT THE LEVEL OF THE A.O. WHEN ASSESSEE CLAIMED THAT TH E BANK A/C. XXX09 DID NOT BELONG TO THE ASSESSEE, THEREFORE, DE TAILED INFORMATION SHOULD HAVE BEEN OBTAINED FROM THE BANK AS TO WHO HAS OPENED THIS BANK ACCOUNT WITH ALL THE DOCUMENTS AND ALL THE DOCUMENTS SHOULD BE CONFRONTED TO THE ASSESSEE. THE STATEMENT OF THE BANK MANAGER SHOULD BE RECORDED FO R VERIFICATION OF THE FACTS ALONG WITH KYC DETAILS AV AILABLE WITH THE BANK. SIMILARLY, AS REGARDS FDRS, THE ASSESSEE EXPL AINED THAT THERE MAY BE A WRONG INFORMATION MENTIONING THE NAM E OF SHRI RANJIT KUMAR PROPRIETOR OF M/S. COMPUTER JUNCTION B ECAUSE FDRS HAVE BEEN PURCHASED OUT OF CASH AVAILABLE IN T HE BOOKS OF ACCOUNT OF THE ASSESSEE. THE ASSESSEE OBTAINED F DRS OF RS.70 LAKHS WHICH INCLUDES RS.12.50 LAKHS, WHICH HAS ALSO SHOWN IN THE BOOKS OF ACCOUNT OF THE ASSESSEE. THEREFORE, TH IS FACT SHOULD BE VERIFIED FROM THE CASH BOOK MAINTAINED BY THE AS SESSEE. IN VIEW OF THESE FACTS, I AM OF THE VIEW THAT THE MATT ER REQUIRES 12 ITA.NO.4245/DEL./2017 SMT. REKHA KUSHWAHA, MAYAPUR, HARIDWAR. RECONSIDERATION AT THE LEVEL OF THE A.O. I ACCORDIN GLY, SET ASIDE THE ORDERS OF THE AUTHORITIES BELOW AND RESTORE ALL THESE THREE ISSUES TO THE FILE OF A.O. WITH A DIRECTION TO RE-D ECIDE ALL THE THREE ISSUES AFRESH, BY GIVING REASONABLE, SUFFICIENT OPP ORTUNITY OF BEING HEARD TO THE ASSESSEE. A.O. IS DIRECTED TO OB TAIN DETAILED INFORMATION FROM THE BANKS AND DETAILS AS TO WHO HA VE OPENED THESE BANK ACCOUNTS WITH THE SUPPORTING DOCUMENTS. A.O. MAY ALSO VERIFY THE DETAILS OF THE FDRS FROM THE BOOKS OF ACCOUNT OF THE ASSESSEE, WHETHER PURCHASED OUT OF THE CASH AVA ILABLE IN THE BOOKS OF ACCOUNT OF THE ASSESSEE. GROUND NOS. 3 , 4 AND 5 OF THE APPEAL OF ASSESSEE ARE ALLOWED FOR STATISTICAL PURPOSES. 12. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOW ED PARTLY FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT. SD/- (BHAVNESH SAINI) JUDICIAL MEMBER DELHI, DATED 01 ST FEBRUARY, 2018 VBP/- 13 ITA.NO.4245/DEL./2017 SMT. REKHA KUSHWAHA, MAYAPUR, HARIDWAR. COPY TO 1. THE APPELLANT 2. THE RESPONDENT 3. CIT(A) CONCERNED 4. CIT CONCERNED 5. D.R. ITAT SMC BENCH, DELHI 6. GUARD FILE. //BY ORDER// ASST. REGISTRAR : ITAT DELHI BENCHES : DELHI.