ITO, Sonepat V. Sh. Surender Singh, Jhajjar

ITA 4701/DEL/2012

• Counselvise Citation: [2015] 121 COUNSELVISE.COM (IT) 0002 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 7 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-04-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: G
• Next Hearing Date: 25-03-2015
• Assessment Year: 2009-2010
• Appeal Filed On: 03-09-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: B R R KUMAR
• Assessee Lawyers: SURENDER SINGH SELF
• Section: 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES : G NEW DELHI BEFORE SMT. DIVA SINGH, JUDICIAL MEMBER AND SHRI T.S.KAPOOR, ACCOUNTANT MEMBER ITA NO. 4701 /DEL/201 2 ASSESSMENT YEAR : 200 9 - 1 0 IT O , WARD - 4, SONEPAT (APPELLANT) VS SURENDER SINGH, S/O - SH.BHIM SINGH, DURGA COLONY, BAHADURGARH, DIST. - JHAJJAR (RESPONDENT ) APPELLANT BY SH.B.R.R.KUMAR, SR. DR RESPONDENT BY SH. SURENDER SINGH (SELF) O R D E R PER DIVA SINGH, JUDICIAL MEMBER BY T HE PRESENT APPEAL FILED BY THE REVENUE CORRECTNESS OF THE ORDER DATED 19. 06 .2012 OF CIT(A), ROHTAK PERTAINING TO 200 9 - 1 0 ASSESSMENT YEAR IS ASSAILED ON THE FOLLOWING GROUNDS: - 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) HAS ERRED IN LAW AND FACTS IN DELETING THE ADDITION OF RS.36,31,500/ - (15,89,000/ - & 20,42,500/ - ) MADE BY AO, U/S 144 OF THE IT ACT, ON ACCOUNT OF UN EXPLAINED CASH DEPOSITS IN BANK ACCOUNT AS THE ASSESSEE FAILED TO FURNISH EVEN SINGLE BILL OR VOUCHER OR ANY OTHER SUSTAINABLE DOCUMENTARY EVIDENCE IN SUPPORT OF HIS SALES/PURCHASES, CLAIMED BY HIM AS SOURCE OF CASH DEPOSITS. 2. THAT THE APPELLANT CRAVES FOR THE PERMISSION TO ADD, DELETE OR AMEND THE GROUND OF APPEAL BEFORE OR AT THE TIME OF HEARING OF APPEAL. 2. THE ASSESSEE PRESENT IN PERSON ORALLY SEEKS TIME TO ENGAGE A COUNSEL HOWEVER ON A PERUSAL OF THE MATERIAL AVAILABLE ON RECORD AND AFTER HEARING THE LD. CIT DR IT WAS CONSIDERED APPROPRIATE TO PROCEED WITH THE PRESENT APPEAL ON THE BASIS OF MATERIAL ON RECORD AND AFTER HEARING THE ASSESSEE HIM S ELF. 3. THE RELEVANT FACTS OF THE CASE ARE THAT THE ASSESSEE WHO IS STATED TO BE DERIVING INCOME FROM TRADING IN BUILDING MATERIAL IN THE NAME AND STYLE OF M/S DATE OF HEARING 2 5 .03.2015 DATE OF PRONOUNCEMENT 08 .04 .2015 ITA NO. 4701 / DEL/ /20 1 2 PAGE 2 OF 4 SHIV BUILDING MATERIAL SUPPLIER RETURNED AN INCOME OF RS.1,57,650/ - BY WAY OF FILING ITS RETURN. THE SAID RETURN WAS SELECTED FOR SCRUTINY THROUGH CASS O N THE BASIS OF AIR INFORMATION WHICH DISCLOSED THAT THE ASSESSEE IN ITS BANK A/C MAINTAINED WITH AXIS BANK AND HDFC BANK IN THE YEAR UNDER CONSIDERATION HAD DEPOSITED THE AMOUNT OF RS.15,89,000/ - & RS.20,42,500/ - . THE NOTICE WAS ISSUED TO THE ASSESSEE U/S 143(2) ETC. TO EXPLAIN THE SAME. HOWEVER THE NOTICE W A S RETURNED BY THE POSTAL AUTHORITIES WITH COMMENT ASSESSEE HAS LEFT THIS SHOP . THEREAFTER THE AO MADE VARIOUS ATTEMPTS AND CONCLUDED THE A SSESSMENT U/S 144 BY MAKING AN ADDITION OF THE SAID AMOUNTS. 4 . IN APPEAL BEFORE THE FIRST APPELLATE AUTHORITY THE ASSESSEE ASSAILED THE ACTION OF THE AO AS BEING NON - MAINTAINABLE FOR WANT OF ISSUANCE OF NOTICE U/S 143(2). THE SAID GROUND WAS DISMISSED BY THE CIT(A). APART FROM THIS THE ASSESSEE IS ALSO FOUND TO HAVE MADE THE FOLLOWING SUBMISSIONS ON THE MERITS OF THE ADDITION BEFORE THE CIT(A): - 4.1. THE ASSESSEE WAS MAINTAINING COMPLETE BOOKS OF ACCOUNTS AND COPIES OF P&L A/C AND BALANCE WERE ATTACHED WITH THE RETURN OF INCOME. THE ASSESSEE IS IN THE UNORGANIZED SECTOR OF SUPPLY OF BUILDING MATERIAL LIKE RODI, RETI ETC. THE BUSINESS TRANSACTIONS WERE CONDUCTED IN THE BANK ACCOUNTS MAINTAINED WITH AXIS BANK AND HDFC BANK. THE SALE RECEIPTS ARE GENERALLY RECEIVED IN CASH IN THE LINE OF THE BUSINESS OF ASSESSEE AND THEY HAVE DEPOSITED IN THE BANK ACCOUNTS ON A REGULAR BASIS. SIMILARLY, THE PAYMENTS FOR THE SUPPLIES ARE ALSO MADE IN CASH WHICH ARE REFLECTED BY WAY OF CASH WITHDRAWALS IN THE BANK ACCOUNTS. TH E TRANSACTIONS APPEARING IN THE BANK ACCOUNTS ARE ONLY IN THE NATURE OF BUSINESS TRANSACTIONS WHICH IS EVIDENT FROM THE BOOKS OF ACCOUNTS. THE ACTION OF THE AO IN MAKING THE ADDITION OF THE CASH DEPOSITS IS THEREFORE ERRONEOUS WITHOUT APPRECIATING THE FAC TS. 5 . THE SUBMISSION OF THE ASSESSEE AS PER RECORD ARE FOUND TO HAVE BEEN R EMANDED TO THE AO AND CONSIDERING THE OBJECTION S OF THE AO IN THE REMAND PROCEEDINGS, THE CIT(A) IS ALSO FOUND TO HAVE REQUIRED THE ASSESSEE TO FILE HIS RE - JOINDER. A PERUSAL O F THE FOLLOWING PARAS SHOWS THAT THE ASSESSEE IS FOUND TO HAVE ADVANCED THE FOLLOWING SUBMISSIONS IN THE RE - JOINDER : - 5.1. IN THE REJOINDER, THE AR SUBMITTED THAT THE AO ACCEPTED THE BOOK RESULTS IN THE ASSESSMENT ORDER BUT WAS RELUCTANT TO ACCEPT THE SAM E IN THE REMAND PROCEEDINGS. THE AO HAS NO WHERE DOUBTED THAT THE ASSESSEE IS NOT DEALING IN TRADING OF BUILDING MATERIAL. THE AO HAS TEST CHECKED THE BOOKS OF ACCOUNTS AND FOUND NO DISCREPANCY IN THEM. THE NET PROFIT DECLARED BY THE ASSESSEE OF RS 1,90, 246/ - ON A ITA NO. 4701 / DEL/ /20 1 2 PAGE 3 OF 4 TURNOVER OF RS.34,78,850/ - IS MORE THAN THE INCOME @ 5% OF THE TURNOVER U/S 44AF OF RS 1,72,942/ - . THE AR FORCEFULLY ARGUED THAT THE ENTIRE TRANSACTIONS IN THE BANK ACCOUNTS ARE BUSINESS IN NATURE AND THEREFORE THE IMPUGNED ADDITION MADE BY TH E AO IS LIABLE TO BE DELETED. 6 . ACCORDINGLY AFTER C ONSIDERING THE MERITS OF THE ARGUMENTS AND FACTS THE CIT(A)PROCEEDINGS TO DELETE THE ADDITION HOLDING AS UNDER: - 6. I HAVE CONSIDERED THE ISSUE AND SUBMISSIONS MADE BY THE AR. THE ASSESSEE IS ENGAGED IN THE TRADING OF BUILDING MATERIAL LIKE RODI, RETI ETC. WHICH IS IN THE UNORGANIZED SECTOR. IT IS COMMON KNOWLEDGE AND WIDELY PREVALENT THAT GENERALLY NO BILLS ARE ISSUED EITHER FOR PURCHASE/SALE OF RODI, RETI ETC. THE ASSESSEE HAS M AINTAINED BOOKS OF ACCOUNTS, WHICH HAVE BEEN TEST CHECKED BY THE AO AND NO ADVERSE COMMENTS HAVE BEEN MADE IN THE REMAND REPORT. THE BANK STATEMENTS ALSO REVEAL PERIODIC :ASH DEPOSITS AND WITHDR AWALS IN SMALL QUANTUMS CORRESPONDING TO THE SALES AND PURCHASES. NO MATERIAL HAS BEEN BROUGHT ON RECORD BY THE AO THAT THE CASH DEPOSITS IN THE TWO BANK ACCOUNTS ARE SEPARATE AND IN ADDITION TO THE TRANSACTIONS SHOWN ON ACCOUNT OF SALES. THE AO HAS NOT FO UND OR LOCATED ANY OTHER BANK ACCOUNT(S) WHEREIN THE TRANSACTIONS AS PER THE BOOKS OF ACCOUNTS, TEST CHECKED BY HIM, HAVE BEEN MADE. UNDER THESE CIRCUMSTANCES, NON PRODUCTION OF BILLS/VOUCHERS CANNOT BE TAKEN AS VALID AND SUFFICIENT GROUND FOR REJECTING TH E CLAIM OF THE ASSESSEE THAT THE TRANSACTIONS IN THE SAID BANK ACCOUNTS ARE BUSINESS IN NATURE. THE ASSESSEE HAS DECLARED NET PROFIT OF RS 1,90,246/ - ON A TURNOVER OF RS.34,78,850/ - WHEREIN PURCHASES OF RS 29,81,600/ - WERE DEBITED. 7 . AGGRIEVED BY THIS T HE REVENUE IS IN APPEAL BEFORE THE TRIBUNAL. THE LD. SR. DR RELIES UPON THE ASSESSMENT ORDER. HOWEVER ON GOING THROUGH THE ABOVE - MENTIONED MATERIAL AVAILABLE ON RECORD WHICH WE HAD CALLED UPON THE LD. SR. DR TO READ , WE FIND THAT NO GOOD REASON HAS BEEN ADVANCED BY THE DEPARTMENT TO ASSAIL THE ABOVE - MENTIONED FINDINGS ON FACTS. IT IS SEEN THAT THE AO HAS TAKEN NOT E ONLY OF THE DEPOSITS AND HAS FAILED TO ADDRESS THE WITHDRAWALS FROM THE SAID BANK ACCOUNTS. CONSIDERING THE FACTS THAT THE ASSESSEE IS STATED TO BELONG TO THE UNORGANISED SECTOR OF SUPPLY OF BUILDING MATERIAL LIKE RODI, RETI ETC AND THE FACTS ON RECORD WHERE NO INFIRMITY HAS BEEN POINTED OUT BY THE REVENUE IN THE IMPUGNED ORDER. WE FIND NO MERIT IN THE DEPARTMENT S GROUNDS. IN THE FACTS A S THEY STAND, WE FIND THAT DEPARTMENT S APPEAL DOES NOT HAVE ANY MERIT. THE SAME IS DISMISSED AS PER THE PRONOUNCED IN THE OPEN COURT IN THE PRESENCE OF THE PARTIES ON THE DATE OF HEARING ITSELF. ITA NO. 4701 / DEL/ /20 1 2 PAGE 4 OF 4 8 . IN THE RESULT THE APP EAL OF THE REVENUE IS DISMISSED . THE SAID ORDER WAS PRONOUNCED IN THE OPEN COURT ON 0 8 T H APRIL, 2015. S D / - S D / - (T.S.KAPOOR) (DIVA SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: THE 0 8 T H APRIL, 2015 *AMIT KUMAR* COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR ITAT NE W DELHI