A.C.I.T., Circle-2, Gwalior V. Ruchi Garg, Morena

ITA 44/AGR/2013

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 0702 (ITAT-AGRA)
• Duration Of Justice: 6 year(s) 3 month(s) 9 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 16-05-2019
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 08-05-2013
• Assessment Year: 2008-2009
• Appeal Filed On: 07-02-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: K C AGARWAL SH PIYUSH SING HAL
• Keywords: Unexplained cash credit; Additional evidence

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, AGRA BENCH, AGRA BEFORE : SHRI BHAVNESH SAINI, JUDICIAL MEMBER AND SHRI A.L. GEHLOT, ACCOUNTANT MEMBER ITA NO. 44/AGRA/2013 ASSTT. YEAR : 2008-09 A.C.I.T., CIRCLE 2, VS. RUCHI GARG, GWALIOR. D/O SHRI RAMESH CHAND GARG, MORENA (PAN: AHTPG 5243 K) (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI WASEEM ARSHAD, SR. D.R. RESPONDENT BY : SHRI K.C. AGARWAL, SH. PIYUSH SING HAL, CA. DATE OF HEARING : 08.05.2013 DATE OF PRONOUNCEMENT OF ORDER : 24.05.2013 ORDER PER BHAVNESH SAINI, J.M.: THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST THE ORDER OF LD. CIT(A), GWALIOR DATED 22.11.2012 FOR THE ASSESSMENT YEAR 20 08-09 ON THE FOLLOWING GROUNDS : 1. WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE CIT(A) WAS RIGHT IN LAW AND ON FACTS IN DELETIN G THE ADDITION OF RS.26,00,000/- MADE BY THE AO TO THE INCOME OF THE ASSESSEE ON ACCOUNT OF UNEXPLAINED CREDITS. 2. WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES O F THE CASE, THE CIT(A) WAS RIGHT IN LAW AND ON FACTS IN ADMITTI NG ADDITIONAL EVIDENCES UNDER RULE 46A OF THE INCOME TAX RULES, 1 962 WITHOUT GIVING ANY OPPORTUNITY TO THE AO. ITA NO. 44/AGRA/2013 2 2. THE AO FROM THE CASH FLOW STATEMENT NOTICED THAT THE ASSESSEE HAS RECEIVED RS.26,00,000/- AS LOAN AND ADVANCE AND OUT OF THAT AMOUNT OF RS.21,90,000/- HAS BEEN TRANSFERRED TO LOAN AND ADVANCE, BUT IN THE PE RSONAL BALANCE SHEET OF THE ASSESSEE, THE SAME FIGURES HAVE NOT BEEN SHOWN. THE REFORE, IT WAS CONSIDERED THAT THE ASSESSEE HAS TRIED TO ESCAPE THAT AMOUNT. THERE FORE, IN THE ABSENCE OF DETAILS, THE ADDITION OF RS.26,00,000/- WAS MADE TREATING AS UNEXPLAINED CASH CREDIT. THE ASSESSEE SUBMITTED BEFORE THE LD. CIT(A) THAT SHE H AS FURNISHED A COPY OF ACCOUNT WITH M/S. K.S. FOOD PRODUCTS TO WHOM THE ABOVE TRAN SACTIONS ARE RECORDED WITH HER REPLY DATED 14.11.2011 FILED ON THE SAME DAY WH EREIN ALL THE TRANSACTIONS ARE REFLECTED. COPY OF THE SAME IS ALSO FILED. THE AO, HOWEVER, FAILED TO CONSIDER THE DETAILS AVAILABLE ON RECORD. THE BALANCE SHEET WITH K.S. FOOD PRODUCTS SHOWS THE COMPLETE DETAILS. THE ASSESSEE ALSO FILED COPY OF B ANK STATEMENT OF ASSESSEE AND M/S. K.S. FOOD PRODUCTS. COPY OF ACCOUNT IN THE BOO KS OF K.S. FOOD PRODUCTS DULY CONFIRMED WERE ALSO FILED WITH THE REPLY DATED 14.1 1.2011. IT WAS, THEREFORE, SUBMITTED THAT THE ADDITION IS WHOLLY UNJUSTIFIED. THE LD. CIT(A) ON EXAMINATION OF THE FACTS AND EVIDENCE ON RECORD NOTED THAT THE AO HAS NOT APPRECIATED THE FACTS CORRECTLY. IT WAS EVIDENT THAT AS ON 01.04.2007, TH E ASSESSEE HAD A DEBIT BALANCE OF RS.4,21,652.15 WITH M/S. K.S. FOOD PRODUCTS. IT MEA NS, THIS AMOUNT IS RECEIVABLE BY THE ASSESSEE FROM M/S. K.S. FOOD PRODUCTS AS ON 01.04.2007. DURING THE ITA NO. 44/AGRA/2013 3 FINANCIAL YEAR 2007-08, THE ASSESSEE MADE FURTHER P AYMENT OF RS.21,90,000/- TO M/S. K.S. FOOD PRODUCTS AND RECEIVED BACK RS.26,00, 000/-. AS A RESULT, AT THE END OF FINANCIAL YEAR AS ON 31.03.2008 (A.Y. 2008-09 UN DER APPEAL), THE NET BALANCES RECEIVABLE BY THE ASSESSEE FROM M/S. K.S. FOOD PROD UCTS WAS RS.11,652.15, WHICH IS REFLECTED IN THE BALANCE SHEET OF THE ASSESSEE A S RECEIVABLE FROM M/S. K.S. FOOD PRODUCTS. THE LD. CIT(A), THEREFORE, FOUND THAT THE ISSUE IS FULLY EXPLAINED ALONG WITH SOURCE, THEREFORE, THE ADDITION IS UNJUSTIFIED . THE ADDITION WAS ACCORDINGLY DELETED. 3. THE LD. DR RELIED UPON THE ORDER OF THE AO. ON T HE OTHER HAND, THE LD. COUNSEL FOR THE ASSESSEE REITERATED THE SUBMISSIONS MADE BEFORE THE AUTHORITIES BELOW AND REFERRED TO PB-50, 51, 52 & 53, WHICH ARE THE COPIES OF ACCOUNT OF M/S. K.S. FOOD PRODUCTS, CASH FLOW SUMMARY OF ASSESSEE, ACCOUNT OF THE ASSESSEE WITH M/S. K.S. FOOD PRODUCTS AND BALANCE SHEET OF THE AS SESSEE AS ON 31.03.2008. PB- 32 IS THE BANK STATEMENT OF ASSESSEE AND PB-33 TO 3 8 IS THE COPY OF BANK ACCOUNT OF M/S. K.S. FOOD PRODUCTS, WHICH REFLECTED THE ENTIRE TRANSACTIONS. 4. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND THE MATERIAL ON RECORD. THE ASSESSEE EXPLAINED BEFORE THE LD. CIT(A) THAT A DET AILED REPLY WAS FURNISHED BEFORE THE AO ON 14.11.2011, WHICH IS SUPPORTED BY ALL THE ABOVE EVIDENCES. THE AO IN ITA NO. 44/AGRA/2013 4 THE ASSESSMENT ORDER HAS MENTIONED THAT THE ASSESSE E HAS FURNISHED REPLY OF THE QUESTIONNAIRE ON 14.11.2011. THUS, IT IS ADMITTED F ACT THAT THE ASSESSEE FILED DETAILED REPLY BEFORE THE AO ON 14.11.2011 BUT THE AO DID NOT MENTION ANYTHING OF THIS REPLY IN THE ASSESSMENT ORDER AND THE EVIDE NCES FILED IN SUPPORT OF THE SAME REPLY. THE COPIES OF THE SAID EVIDENCES ARE FILED I N THE PAPER BOOK AS ABOVE. PB-52 IS COPY OF ACCOUNT OF ASSESSEE IN LEDGER OF K.S. FO OD PRODUCTS, WHICH SUPPORTS THE CONTENTION OF THE ASSESSEE THAT ON 01.04.2007, THE ASSESSEE HAD A DEBIT BALANCE OF RS.4,21,652.15. THE ASSESSEE RECEIVED RS.20,00,000/ - THROUGH STATE BANK OF INDIA ON 03.01.2008 AND MADE PAYMENT OF RS.19,90,000/- ON 04.01.2008 AND ALSO MADE FURTHER PAYMENT OF RS.2,00,000/- ON 12.01.2008 THRO UGH STATE BANK OF INDIA. AGAIN ON 31.03.2008, THE ASSESSEE RECEIVED CHEQUES OF RS.6,00,000/-. THUS AT THE END OF THE FINANCIAL YEAR RELEVANT TO ASSESSMENT YE AR UNDER APPEAL, THE ASSESSEE HAS BALANCE OF RS.11,652.15, WHICH IS RECEIVABLE BY THE ASSESSEE FROM M/S. K.S. FOOD PRODUCTS. SAME AMOUNT IS REFLECTED IN THE BALANCE S HEET OF ASSESSEE AS ON 31.03.2008 (PB-53). IT IS SUPPORTED BY THE COPY OF THE ACCOUNT AND CASH FLOW SUMMARY (PB-50 AND 51) AS WELL AS BANK ACCOUNT OF T HE ASSESSEE AND M/S. K.S. FOOD PRODUCTS (PB-32 TO 38). IT, THEREFORE, APPEARS THAT THE AO HAS IGNORED THE REPLY OF THE ASSESSEE DESPITE MENTIONING IN THE ASS ESSMENT ORDER THAT THE ASSESSEE FILED REPLY BEFORE HIM. THE ASSESSEE HAS EXPLAINED THE ENTIRE TRANSACTION THROUGH EVIDENCE AND MATERIAL ON RECORD. THE LD. CIT(A) ON PROPER APPRECIATION OF FACTS ITA NO. 44/AGRA/2013 5 AND MATERIAL ON RECORD RIGHTLY DELETED THE ADDITION . WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF THE LD. CIT(A) IN DELETING THE ADDITIO N. THE DEPARTMENTAL APPEAL FAILS AND IS ACCORDINGLY DISMISSED. 5. IN THE RESULT, THE DEPARTMENTAL APPEAL IS DISMIS SED. ORDER PRONOUNCED IN THE OPEN COURT. SD/- SD/- (A.L. GEHLOT) (BHAVNESH SAINI) ACCOUNTANT MEMBER JUDICIAL MEMBER *AKS/- COPY OF THE ORDER FORWARDED TO : 1. APPELLANT 2. RESPONDENT 3. CIT(A), CONCERNED BY ORDER 4. CIT, CONCERNED 5. DR, ITAT, AGRA 6. GUARD FILE SR. PRIVATE SECRETARY TRUE COPY