ITO, Ward - 42(4), Kolkata, Kolkata V. Pravakar Majumder, Kolkata

ITA 459/KOL/2011

• Counselvise Citation: 45923514 RSA 2011
• Duration Of Justice: 2 year(s) 9 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-01-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Assessment Year: 2006-2007
• Appeal Filed On: 18-03-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: NIRANJAN SATPATI
• Keywords: Peak credit

Judgement Text

I.T.A. NOS. 459-460/KOL./2011 ASSESSMENT Y EARS : 2006-07 & 2007-08 PAGE 1 TO 4 1 IN THE INCOME TAX APPELLATE TRIBUNAL, KOLKATA C BENCH, KOLKATA CORAM : SHRI MAHAVIR SINGH (JUDICIAL MEMBER) AND SHRI ABRAHAM P. GEORGE (ACCOUNTANT MEMBER) I.T.A. NOS. 459 & 460/KOL./ 2011 ASSESSMENT YEARS : 2006-2007 & 2007-2008 INCOME TAX OFFICER,...........................,.... ...........APPELLANT WARD-42(4), KOLKATA, 18, RABINDRA SARANI, KOLKATA-700 001 -VS.- PRAVAKAR MAJUMDER,......................RESPONDE NT 27, HIMANGSHU MOHAN CHAKRABORTY ROAD, KOLKATA-700 108 [PAN : AJQPM 1726 Q] APPEARANCES BY: SHRI NIRANJAN SATPATI, JCIT, SR. D.R., FOR THE DEPA RTMENT NONE, FOR THE ASSESSEE DATE OF CONCLUDING THE HEARING : JANUARY 06, 2014 DATE OF PRONOUNCING THE ORDER : JANUARY 08, 2014 O R D E R PER ABRAHAM P. GEROGE: 1. THESE ARE APPEALS FILED BY THE REVENUE DIRECTED AGAINST ORDERS DATED 03.01.2011 OF COMMISSIONER OF INCOME TAX (APP EALS)-XII, KOLKATA FOR THE IMPUGNED ASSESSMENT YEARS. 2. NOBODY APPEARED FOR THE ASSESSEE. HOWEVER ASSESS EE HAS FILED AN ADJOURNMENT PETITION. SINCE MATTER HAS BEEN ADJOURN ED FOR A NUMBER OF TIMES EARLIER WE ARE NOT INCLINED TO ACCEPT IT. THE ADJOURNMENT PETITION IS, THEREFORE, REJECTED. 3. FACTS APROPOS ARE THAT ASSESSEE ENGAGED IN THE B USINESS OF TRADING OF READYMADE GARMENTS, HAD FILED HIS RETURNS FOR TH E IMPUGNED I.T.A. NOS. 459-460/KOL./2011 ASSESSMENT Y EARS : 2006-07 & 2007-08 PAGE 1 TO 4 2 ASSESSMENT YEARS DECLARING INCOME OF RS.2,03,433/- AND RS.2,11,800/- RESPECTIVELY. ASSESSEE HAD MAINTAINED A SAVINGS BAN K ACCOUNT BEARING NUMBER 01741000083428 WITH HDFC BANK, SHYAMBAZAR BR ANCH AND AN ACCOUNT BEARING NO. 236010100039358 WITH AXIS BANK LTD. AT B.T. ROAD, KOLKATA. AS PER ASSESSING OFFICER THERE WERE CASH D EPOSITS OF RS.20,53,200/- AND RS.11,22,500/- IN THE HDFC BANK ACCOUNT DURING THE PREVIOUS YEARS RELEVANT TO ASSESSMENT YEAR 2006-07 AND 2007-08 RESPECTIVELY. IN ADDITION IN THE LATTER YEAR ASSESS EE ALSO HAD DEPOSITS OF RS.17,90,000/- IN HIS AXIS BANK ACCOUNT. IT SEEMS D URING THE COURSE OF ASSESSMENT PROCEEDINGS ASSESSEE WAS UNABLE TO EXPLA IN THE SOURCE OF THESE DEPOSITS. THEREFORE, THE ASSESSING OFFICER MA DE AN ADDITION OF RS.20,53,200/- FOR ASSESSMENT YEAR 2006-07 AND RS.2 9,12,500/- FOR THE ASSESSMENT YEAR 2007-08. 4. ASSESSEE MOVED IN APPEALS BEFORE THE CIT(APPEALS ) FOR BOTH THE YEARS. ARGUMENT OF THE ASSESSEE WAS THAT THE DEPOSI TS AND WITHDRAWALS IN THE BANK ACCOUNTS, RELATED TO HIS GARMENT BUSINESS. AS PER THE ASSESSEE SALE PROCEEDS WERE DEPOSITED IN THE BANK ACCOUNT. C ASH WITHDRAWALS WERE ALSO MADE THEREFROM FOR THE PURPOSE OF THE BUS INESS. LD. CIT(APPEALS) SOUGHT FOR A REMAND REPORT BASED ON TH E DOCUMENTS FILED BY THE ASSESSEE. ASSESSING OFFICER IN THE REMAND REPOR T STATED THAT ASSESSEE FAILED TO FILE ANY EVIDENCE FOR EXPLAINING THE SOUR CE OF DEPOSITS IN THE BANK ACCOUNTS. AS PER THE ASSESSING OFFICER ASSESSE E COULD NOT PRODUCE ANY BILLS OR VOUCHERS IN SUPPORT OF HIS CLAIM OF CA SH SALES AND CASH PURCHASES OF GARMENTS. 5. LD. CIT(APPEALS) AFTER VERIFYING DOCUMENTS OF AS SESSEE AND THE BANK ACCOUNT STATEMENTS FOUND THAT SIMILAR DEPOSITS WERE THERE IN ASSESSEES BANK ACCOUNT FOR THE PREVIOUS YEAR RELEV ANT TO ASSESSMENT YEAR 2005-06 ALSO. IN ASSESSEES APPEAL FOR ASSESSM ENT YEAR 2005-06, LD. CIT(APPEALS) HAD HELD THAT ENTIRE DEPOSITS IN THE B ANK ACCOUNT COULD NOT BE TREATED AS UNDISCLOSED INCOME BUT ONLY PEAK CRED IT WAS LIABLE FOR I.T.A. NOS. 459-460/KOL./2011 ASSESSMENT Y EARS : 2006-07 & 2007-08 PAGE 1 TO 4 3 ADDITION. LD. CIT(APPEALS) AFTER VERIFYING THE BANK STATEMENT FOUND THAT THE PEAK CREDIT IN THE BANK ACCOUNTS FOR PREVIOUS Y EAR RELEVANT TO ASSESSMENT YEAR 2006-07 CAME TO RS.8,80,536/- AND F OR ASSESSMENT YEAR 2007-08 CAME TO ONLY RS.12,18,564/-. SINCE THE PEAK CREDIT OF RS.2,76,472/- IN THESE ACCOUNTS WERE ALREADY BROUGH T TO TAX IN ASSESSMENT YEAR 2005-06, LD. CIT(APPEALS) HELD THAT WHAT COULD BE ASSESSED FOR ASSESSMENT YEAR 2006-07 WAS ONLY RS.6, 04,064/-. FOR ASSESSMENT YEAR 2007-08 HE HELD THAT THE PEAK CREDI TS FOR ASSESSMENT YEAR2005-06 AND ASSESSMENT YEAR 2006-07 ALREADY CON SIDERED WERE TO BE GIVEN CREDIT. AS PER THE LD. CIT(APPEALS) THE BALAN CE PEAK CREDIT THAT COULD BE TAXED FOR ASSESSMENT YEAR 2007-08 WAS RS.3 ,38,028/- ONLY. RELIEF WAS GIVEN TO THE ASSESSEE ACCORDINGLY. 6. NOW BEFORE US, LD. DR STRONGLY ASSAILING THE ORD ER OF LD. CIT(APPEALS) SUBMITTED THAT ASSESSEE COULD NOT PROD UCE ANY RECORDS IN SUPPORT OF HIS PEAK CREDIT THEORY. LD. CIT(APPEALS) HAD ACCEPTED THIS CONTENTION OF THE ASSESSEE AND GIVEN CONSIDERABLE R ELIEF TO HIM WITHOUT PROPERLY APPRECIATING THE FACTUAL ASPECTS. AS ALREA DY MENTIONED NOBODY APPEARED FOR THE ASSESSEE. 7. WE HAVE HEARD THE CONTENTIONS OF LD. D.R. AND PE RUSED THE MATERIAL AVAILABLE ON RECORD. THOUGH THE ASSESSEE HAS NOT AP PEARED BEFORE US, HE HAS FILED A PAPER BOOK, IN WHICH COPIES OF BANK STA TEMENTS ARE AVAILABLE. A CURSORY GLANCE OF THE BANK STATEMENTS CLEARLY SHO W THAT WITHDRAWALS MADE BY THE ASSESSEE WERE SUBSTANTIALLY IN CASH. TH ERE WERE VERY FEW ENTRIES OF WITHDRAWALS OTHER THAN THROUGH CASH. WHE N CASH WITHDRAWALS AND CASH DEPOSITS WERE AVAILABLE, IN OUR OPINION AS SESSING OFFICER OUGHT HAVE CONSIDERED THE WITHDRAWALS AS A SOURCE FOR EXP LAINING THE DEPOSITS. ASSESSEE HAD ALL ALONG STATED THAT THE WITHDRAWALS AND DEPOSITS WERE ONLY ON ACCOUNT OF HIS CASH PURCHASES AND SALES OF GARME NTS. LD. CIT(APPEALS) IN HIS ORDER FOR AN EARLIER ASSESSMENT YEAR NAMELY ASSESSMENT YEAR 2005- 06 HAD CONSIDERED THE PEAK CREDIT IN THE BANK ACCOU NT AFTER CONSIDERING I.T.A. NOS. 459-460/KOL./2011 ASSESSMENT Y EARS : 2006-07 & 2007-08 PAGE 1 TO 4 4 CASH WITHDRAWALS AND CASH DEPOSITS. IN SUCH WORK OU T HE HAD EXCLUDED THE WITHDRAWALS WHICH WERE NOT MADE IN CASH. THUS IN OU R OPINION LD. CIT(APPEALS) HAD PROPERLY GONE THROUGH THE BANK STA TEMENTS AND HELD THAT ONLY THE PEAK CREDIT COULD BE ASSESSED TO TAX. IN DOING SO, LD. CIT(APPEALS) ALSO CONSIDERED THE PEAK CREDITS ALREA DY CONSIDERED IN THE PRECEDING ASSESSMENT YEAR 2005-06. IN FACT, REVENUE HAS NOT BEEN ABLE TO POINT OUT WHETHER ANY APPEAL HAS BEEN FILED BEFORE THIS TRIBUNAL AGAINST THE ORDER OF LD. CIT(APPEALS) FOR ASSESSMENT YEAR 2 005-06. IN THIS VIEW OF THE MATTER, WE ARE OF THE OPINION THAT THE APPEALS OF THE REVENUE ARE DEVOID OF ANY MERIT. 8. IN THE RESULT, THE APPEALS OF THE REVENUE ARE DI SMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 8 TH DAY OF JANUARY, 2014. SD/- SD/- MAHAVIR SINGH ABRAHAM P. GEORGE (JUDICIAL MEMBER) (ACC OUNTANT MEMBER) KOLKATA, THE 8 TH DAY OF JANUARY, 2014 COPIES TO : (1) THE APPELLANT (2) THE RESPONDENT (3) CIT (4) CIT(A) (5) THE DEPARTMENTAL REPRESENTATIVE (6) GUARD FILE BY ORDER ETC ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL KOLKATA BENCHES, KOLKATA LAHA/SR. P.S.