AMRISH ARORA, MUMBAI V. ACIT-17(1), MUMBAI

ITA 4740/MUM/2018

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 8405 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 5 month(s) 14 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-01-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2012-2013
• Appeal Filed On: 06-08-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Unexplained cash credit; Set aside; Capital Gains
• Section: 142(1); 143(2); 13

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH, MUMBAI BEFORE SHRI SHAMIM YAHYA , AM AND SHRI AMARJIT SINGH, JM / I.T.A. NO. 4740 /MUM/201 8 ( / ASSESSMENT YEAR: 20 1 2 - 1 3 ) AMRISH ARORA 216, SHALIMAR, MARIN DRI VE, MUMBAI - 400020. / VS. ACIT - 17(1) AAYAKAR BHAVAN, MUMBAI - 400020. ./ ./ PAN/GIR NO. : AAAPA9192K ( / APPELLANT ) .. ( / RESPONDENT ) / DATE OF HEARING: 06 / 01 / 20 20 /DATE OF PRONOUNCEMENT: 20 / 01 / 2020 / O R D E R PER AMARJIT SINGH, JM: THE ASSESSEE HAS FILED THE PRE SENT APPEAL AGAINST THE ORDER DATED 15 . 05 .201 8 PASSED BY THE COMMISSIONER OF INCOME TAX (APPEALS) - 55 , MUMBAI [HEREINAFTE R REFERRED TO AS THE CIT(A)] RELEVANT TO THE A.Y. 20 12 - 1 3 . 2 . THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS: - FOR THE YEAR UNDER APP EAL, APPELLANT FILED RETURN OF INCOME DECLARING TOTAL INCOME OF RS 6,47,38,112/ - THE CASE OF THE APPELLANT WAS SELECTED FOR SCRUTINY AND THE APPELLANT DULY FILED ALL THE DETAILS CALLED FOR BY THE ASSESSING OFFICER FROM TIME TO TIME. DURING THE YEAR THE APP ELLANT HAD PURCHASED 2 CARS ALONG WITH ACCESSORIES FROM ONE 'REEMA SEN AND UPAJ ENTERPRISES FOR A TOTAL ASSESSEE BY : SHRI SHIV PRAKASH (AR) REVENUE BY: SH RI AKHTAR ALI ANSARI (DR) ITA NO. 7410 / M/201 8 A.Y.20 12 - 13 2 CONSIDERATION OF RS.25,00,000/ - (RS 11,00,000 + RS 14,00,000). THE PAYMENTS FOR THE SAME WERE MADE BY BANK PAY ORDER. THE AFORESAID 2 CARS (WITHOUT THE ACCESSORIES) WERE SOLD TO TWO SEPARATE PARTIES MR RAVINDRA KADEL AND M/S DHRUV AUTOMOBILES, PROP: DINESH KADAM, FOR A TOTAL CONSIDERATION OF RS 10,70,000/ - PAYMENTS FOR THE ABOVE SALE HAVE BEEN RECEIVED BY THE APPELLANT BY CHEQUES AND ARE REFLECTED IN HIS BANK ACCOUNT. THE ACCESSORIES WERE SOLD SEPARATELY TO 14 DIFFERENT PARTIES IN CASH. THE NAMES OF THE PARTIES WHO PURCHASED THE ACCESSORIES HAVE BEEN DULY FURNISHED TO THE ASSESSING OFFICER DURING ASSESSMENT PROCEEDINGS AND THE PROCEEDS THEREOF TOTALING AB OUT RS 14 LAKHS WERE DULY DEPOSITED INTO THE BANK ACCOUNT OF THE APPELLANT. THE LEARNED ASSESSING OFFICER HAS MADE THE ADDITION ON THE ASSUMPTION THAT SINCE THERE IS NO ROAD TRANSPORT PERMIT TAKEN BY THE APPELLANT THE SALE OF THE VEHICLES CANNOT BE ACCEPTE D. THE LEARNED ASSESSING OFFICER HAS FAILED TO APPRECIATE THE FOLLOWING FACTS WHILE ARRIVING AT THE AFORESAID CONCLUSION 1. THE APPELLANT HAS PURCHASED AND SOLD SECOND HAND CARS (NOT NEW CARS) 2. THE ROAD TRANSPORT PERMIT IS NOT TO BE TRANSFERRED BY THE AP PELLANT IN HIS NAME AS HE IS NOT THE ULTIMATE USER BUT ONLY A DEALER OF THE CAR AND AS SUCH HE IS NOT REQUIRED TO OBTAIN THE ROAD TRANSPORT PERMIT IN RESPECT OF SUCH VEHICLES IN HIS NAME. HOWEVER, DELIVERY CHALLANS HAVE BEEN EXECUTED BETWEEN THE PURCHASER S AND THE SELLER. THE ASSESSING OFFICER NEVER CALLED FOR THIS DOCUMENT . 3 . THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE FILED HIS RETURN OF INCOME ON 30 . 0 7 .20 1 2 DECLARING TO TAL INCOME TO THE TUNE OF RS .6,47,38,112 / - FOR THE A.Y. 2012 - 1 3 . THE CASE WAS SELECTED FOR SCRUTINY. NOTICES U/S 143(2) & 142(1) OF THE ACT WERE ISSUED AND SERVED UPON THE ASSESSEE. THE ASSESSEE IS AN INDIVIDUAL WHO IS DIRECTOR IN FEW COMPANIES AND HAS SHOWN INCOME FROM CAPITAL GAINS AND INTEREST INCOME. THE ASSESSEE WAS ASKED TO R ECONCILE THE DETAILS OF AIR WITH ITS BOOKS. THE ASSESSEE DEPOSITED THE CASH IN SUM OF RS.14,00,000/ - IN HIS ACCOUNT. THE ASSESSEE WAS ASKED TO EXPLAIN THESE CASH DEPOSITS. THE ASSESSEE PURCHASED THE CAR ITA NO. 7410 / M/201 8 A.Y.20 12 - 13 3 FROM REEMA SEN IN CONSIDERATION OF RS.11,00,000/ - AND ANOTHER CAR WAS PURCHASED CASH IN SUM OF RS.14,00,000/ - THROUGH A PAY ORDER. THEREAFTER, THE ASSESSEE SOLD TWO CAR S SPARE PARTS TO MRS. RAVINDRA KADEL AND DHRUV AUTOMOBILES FOR RS.6,70,000/ - AND RS.4,00,000/ - RESPECTIVELY. HE SOLD THE BODY OF CAR WHILE TH E SPARES AND ACCESSORIES WERE SOLD TO OTHER CUSTOMERS. THE PAYMENTS WERE DEPOSITED IN THE BANK. THE ASSESSEE PROVIDED THE LIST OF 14 PARTIES WHO PURCHASED THE SP ARES. THE AO WAS NOT SATISFIED AND ADDED THE SAID AMOUNT AS UNEXPLAINED CASH CREDIT AND ASSESSE D THE INCOME IN SUM OF RS.6,61,38,110/ - . FEELING AGGRIEVED, THE ASSESSEE FILED AN APPEAL BEFORE THE CIT(A) WHO CONFIRMED THE ADDITION RAISED BY THE AO , THEREFORE, THE ASSESSEE HAS FILED THE PRESENT APPEAL BEFORE US . 4 . WE HAVE HEARD THE ARGUMENT ADVANCED B Y THE LD. REPRESENTATIVE OF THE PARTIES AND PERUSED THE RECORD. THE LD. REPRESENTATIVE OF THE ASSESSEE HAS ARGUED THAT THE ASSESSEE HAS PURCHASED THE OLD BMW CAR FROM MRS. REEMA SEN ON 14.11.2011 IN SUM OF RS.11,00,000/ - . THE ASSESSEE MADE THE PAYMENT THRO UGH PAY ORDER AND THE ASSESSEE ALSO PURCHASED MERCEREDES BENZ CAR FROM M/S. UPAJ ENTER PRISES IN SUM OF RS.14,00,000/ - .IN THIS REGARD, T HE NECESSARY DOCUMENTS WERE FURNISHED BUT THE CIT(A) HAS WRONGLY CONFIRMED THE ADDITION, HENCE, THE FINDING OF THE CIT(A) IS NOT JUSTIFIABLE, HENCE, LIABLE TO BE SET ASIDE. HOWEVER, ON THE OTHER HAND, THE LD. REPRESENTATIVE OF THE DEPARTMENT HAS REFUTED THE SAID CONTENTIONS. T HE ASSESSEE PURCHASE D THE OLD BMW CAR FROM M/S. REEMA SEN IN SUM OF RS.11,00,000/ - . IN THIS REGARD, THE NECESSARY DOCUMENTS ARE ON RECORD WHICH LIES AT PAGE NO. 7 TO 20 OF THE PAPER BOOK. THE PAYMENT WAS MADE THROUGH CHEQUE. THE ASSESSEE ALSO PURCHASED THE MERCEREDES BENZ FROM M/S. UPAJ ENTERPRISES IN SUM OF RS.14,00,000/ - AND PAID IN SUM OF RS.14,00,000 / - . THE PAYMENT WAS ALSO MADE THROUGH CHEQUE AND IN THIS REGARD THE ITA NO. 7410 / M/201 8 A.Y.20 12 - 13 4 NECESSARY DOCUMENTS LIES AT PAGE NO. 21 TO 33 OF THE PAPER BOOK . T HE DOCUMENTS NOWHERE SEEMS FALSE AND FABRICATED. THEREAFTER, THE ASSESSEE SOLD THE SAID CAR AFTER DISMANTLING. THE BODY OF THE CAR OF BMW WAS SOLD TO M/S. DRUV AUTOMOBILES IN SUM OF RS.4,00,000/ - AND IN THIS REGARD THE ASSESSEE RECI9EVED THE AMOUNT OF RS.4,00,000/ - IN VIEW OF THE DOCUMENT EXHIBIT - A LIES AT PAGE NO. 24 OF THE PAPER BOOK. THE ASSESSEE ALSO SOLD THE MERCEREDES B ENZ CAR TO MR. RAVINDER KADEL IN SUM OF RS.6,70,000/ - . THE CAR WAS TRANSFERRED WITH HIS NAME AND IN THIS REGARD THE DOCUMENTS LIES AT PAGE EXHIBIT B. THEREAFTER, THE ASSESSEE SOLD THE SPARE PARTS OF THE BMW CAR AND DETAILS OF WHICH ARE HEREBY MENTIONED B ELOW .: - MR. INDRAJIT THAKUR - ALLOW WHEEL RS.1,00,000 MR. XERSES DARUWALA - P ERFORMANCE LIST RS.1,75,000/ - MR. AJMAL SHAIKH - XENEON LIGHTS RS.75,000/ - MR. SATISH KALE - SEATS RS. 25,000/ - MR. SATISH KALE - TYRES RS.1,00,000/ - MR. RAKESH CHAKRAWORT H I DEAK RS.1,00,000/ - MR. VIRSHI SALEHU - BODY KIT RS.1,25,000 RS.7,00,000 THE REL EVANT DOCUMENT HAS BEEN EXECUTED BY ASSESSEE IN THEIR FAVOUR WHICH LIES AT PAGE NO. 13 TO 20 OF THE PAPER BOOK. THE DEPOSITED IN THE ACCOUNTS ARE FROM THE SALE OF THE CARE AS WELL AS SALE OF THE SPARE PART OF THE CAR. NOTHING CAME INTO NOTICE THAT THE CAR IS IN POSSESSION OF THE ASSESSEE AND THE PAYMENT WAS NOT BELONGING TO TO SELL OF THE SAID CAR/SPARE PARTS. THE BUSINESS OF THE ASSESSEE SEEMS TO BE ALIENATE THE SPARE PARTS OF THE CAR AFTER ITS DISMANTLING . T HERE IS NO NEED TO CHANGE THE NAME IN THE RC. NO DOUBT, THE RC IS REQUIRED TO BE CANCELLED. THE GENUINENESS OF THE TRANSACTION WAS ITA NO. 7410 / M/201 8 A.Y.20 12 - 13 5 NOT CONFIRMED. NO DOUBT, THE EVIDENCE ADDUCED BY ASSESSEE CAN BE DISCREDIT BY ADDUCING COGENT AND CONVINCING MATERIAL ON RECORD . T HE EVIDENCE IS NOT LIABLE TO BE DECLINED ON THE BASIS OF SURMISES AND CONJECTURES. THE EVIDENCE ADDUCED BY ASSESSEE IS NOWHERE REBUTTED BY AO BY BRINGING THE SUFFICIENT EVIDENCE ON RECORD. TAKING INTO ACCOUNT, ALL THE FACTS AND CIRCUMSTANCES, WE ARE OF THE VIEW THAT THE ASSESSEE HAS EXPLAINED TH E CASH CREDIT IN SUM OF RS. 14,00000 / - . BEING JUSTIFIABLE, THEREFORE, WE ARE OF THE VIEW THAT THE FINDING OF THE CIT(A) IS NOT JUSTIFIABLE, HENCE , WE SET ASIDE THE FINDING OF THE CIT(A) AND ALLOWED THE CLAIM OF THE ASSESSEE AGAINST THE REVENUE. 5 . IN THE RE SULT, THE APPEAL FILED BY THE ASSESSEE IS HEREBY ORDERED TO BE ALLOWED . ORDER PRONOUNCED IN THE OPEN COURT ON 20 /01/2020 SD/ - SD/ - ( SHAM IM YAHYA ) (AMARJIT SINGH) / ACCOUNTANT MEMBER /JUDICIAL MEMBER MUMBAI; DATED : 20 /01/2020 V IJAY PAL SINGH/ SR. P.S. / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ( ) / THE CIT(A) - 4. / CIT 5. , , / DR, ITAT, MUMBAI 6. / GUARD FILE. / BY ORDER, //TRUE COPY// ( ASSISTANT REGISTRAR ) , / ITAT, MUMBAI