Sh. Sanjeev Tomar, Agra V. I.T.O.-2(4), Agra

ITA 50/AGR/2016

AI Insights

Shri Sanjeev Tomar appealed against the order of the CIT(A) which sustained the additions made by the Assessing Officer regarding unexplained cash deposits and agricultural receipts. The Assessing Officer had treated these as unexplained money under Section 69 of the Income Tax Act, leading to a significant tax liability for the assessee. The Tribunal examined the evidence presented, including bills and confirmations from Agra Aloo Trading Company, and found discrepancies and lack of credible evidence supporting the assessee's claims. The Tribunal also noted that the assessee did not seek cross-examination of the witnesses whose statements were used against him, and upheld the lower authorities' decisions.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 130882 (ITAT-AGRA)
• Duration Of Justice: 7 year(s) 4 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-08-2023
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 17-07-2023
• Assessment Year: 2011-2012
• Appeal Filed On: 27-03-2016
• Laws Referred To: Income Tax Act
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Peak credit; Deemed to accrue or arise in india
• Section: 69; 69A

Judgement Text

Page 1 of 7 IN THE INCOME TAX APPELLATE TRIBUNAL AGRA BENCH ‘DB’: AGRA (Through Video Conferencing) BEFORE, SHRI SHAMIM YAHYA, ACCOUNTANT MEMBER AND SHRI YOGESH KUMAR U.S., JUDICIAL MEMBER ITA No.50/Agr/2016 (ASSESSMENT YEAR: 2011-12) Shri Sanjeev Tomar H.No.498, Sector-10 Avas Vikas Colony Sikandra, Agra PAN-ABRAS 2531D Vs. Income Tax Officer-2(4) Ayakar Bhawan Sanjay Place Agra (Appellant) (Respondent) Appellant by Mr. Rajendra Sharma, Advocate Respondent by Mr. Shailendra Srivastava, Sr. DR Date of Hearing 18/07/2023 Date of Pronouncement 17/08/2023 ORDER PER YOGESH KUMAR U.S., JM: This appeal by Assessee is filed against the order of Learned Commissioner of Income Tax (Appeals)-1, Agra [“Ld. CIT(A)”, for short], dated 20.10.2015, for the Assessment Year 2011-12. ITA No.50/Agr/2026 Sanjeev Tomar vs. ITO Page 2 of 7 2. Grounds taken in this appeal are as under: “1. BECAUSE, the 'appellant' denies its liability to be assessed at Income of Rs. 78,31,850/- (in respect of addition of Rs. 75,81,000/-) and accordingly denies its liability to pay Tax and Interest charged upon such addition vide Notice of demand. 2. BECAUSE, the authorities below were not justified in making and sustaining addition of Rs.65,21,000/- which represents sale proceeds of trading receipts undertaken by the appellant. 3. BECAUSE, the learned Assessing Officer has erred in law and on facts in placing reliance upon the so called statement of Gitaram Tyagi without examining said Gitaram Tyagi and without examining his books of accounts and without allowing copies of the alleged statements and also without allowing cross-examination of the party on whose testimony addition has been made. 4. BECAUSE, in any case and in any view of the matter impugned additions/disallowances and impugned assessment order is bad in law, illegal, unjustified barred by limitation, contrary to facts and law based upon incorrect assumption of facts and further without allowing adequate opportunity of hearing in violation of principals of natural justice and therefore, the additions made deserves to be quashed. 5. BECAUSE, addition of Rs.10,60,000/-has been made on wrong assumption of facts and law ignoring the material evidences brought on records by the 'appellant'. 6. BECAUSE, in alternative and in any view of the matter the Assessing officer ought to have worked out peak credit in respect of all bank accounts held by the appellant' and addition made in respect of each account resulted into double addition in respect of deemed Income. 7. BECAUSE, the assessment order to the extent making variation in Returned Income is bad in law and against the facts of the case. The ‘appellant’ craves leave to add, alter or vary the grounds of appeal before or at the time of hearing.” ITA No.50/Agr/2026 Sanjeev Tomar vs. ITO Page 3 of 7 3. The assessee filed return declaring total income of Rs. 2,34,730/- the case of the assessee was selected for scrutiny and an assessment order u/s 143(3) of the Act came to be passed by making an addition of Rs. 75,81,000/- treating the same as unexplained money defined u/s 69 of the Act and further added sum of Rs. 16,121/- which being understated interest received by the assessee. Aggrieved by the assessment order dated 27/03/2014 in so far as addition of Rs. 75,81,000/- on account of bank credit entries u/s 69A of the Act, the assessee preferred an appeal before the CIT(A). The Ld. CIT(A) vide order dated 20/10/2015, dismissed the Appeal filed by the assessee. As against the order of the CIT(A) dated 20/10/2015 the assessee preferred the present appeal on the grounds mentioned above. 4. The grounds of Appeal of the Assessee are regarding sustaining the addition of Rs. 65,21,000/- which claim to be sale proceeds of trading receipts undertaken by the Assessee and sustaining addition of Rs. 10,60,000/- claim to be agriculture receipt. The Ld. Counsel for the assessee addressing on the Grounds of Appeal submitted that the assessee is a ‘dalali’/ ‘agent’. The deposits in the bank accounts i.e. State Bank of Hyderabad and Oriental Bank of Commerce represent the amount received by the Assessee as commission agent in respect of sale of agricultural produce sold by the assessee for and on behalf of a firm Agra Aaloo Trading Company, Nasik further submitted that, the amount deposited in cash were immediately withdrawn only and small amount remained in the bank accounts which the assessee has actually owned. ITA No.50/Agr/2026 Sanjeev Tomar vs. ITO Page 4 of 7 Further submitted that, the assessee is actually engaged in the business of sale and purchase, entire deposits amounts are not owned by the assessee, the Ld. A.O. without appreciating the facts and considering the nature of the entries made, the addition cannot be sustained. Further submitted that the entire deposits cannot be considered as the income of the assessee, only net profit rate is to be applied on the total deposits are found in the bank account or closing balance remained at the end of the Financial Year i.e. on 21/03/2011 or peak investment may kindly be considered as unexplained for the purpose of Section 69A of the Act. Thus, prayed for setting aside the orders of the Lower Authorities. 5. Per contra, the Ld. Departmental Representative filed a written submission and contended that the assessee called to explain the cash deposits in the bank, the assessee produced various bills from Agra Alu Trading Company to show that the assessee was receiving cash payment as commission for sale of potato crop and other agricultural produce. The assessee has also produced confirmation certificate for getting commission in cash from property deals. When the bills produced by the assessee were verified from Agra Alu Trading Company qua there was specific denial of making any payments to the Assessee. The Ld. A.O. made independent enquiry and found that the bill produced by the assessee were fabricated by misusing the letter of M/s Agra Alu Trading Company. The assessee has also not able to file any evidence of carrying out any basic agricultural activities and ITA No.50/Agr/2026 Sanjeev Tomar vs. ITO Page 5 of 7 sale of agriculture produce. Therefore, the claim of treating the income as agriculture by the assessee was not supported by any documentary evidence. Therefore, cash deposits have been rightly treated as unexplained. Thus, the Ld. DR sought for dismissal of the Appeal. 6. We have heard both the parties and perused the material available on record. During the assessment proceedings, the assessee produced various bills from M/s Agra Aloo Trading Company and claimed that the assessee was receiving cash payments as commission for sale of potato crop and other agriculture produce. The assessee had also produced some confirmation certificates for getting commission in cash for property bills were also furnished. When the A.O. verified the bills produced by the assessee from M/s Agra Alu Trading Company they have specifically denied making any payment to the assessee. The said information has also been confronted with the assessee. The assessee once again filed letter claimed to have been issued by M/s Agra Alu Trading Company that these transactions are genuine. The A.O. again verified the genuineness of two confirmations, but from the enquiry report of ITO, Nasik it was gathered again through an independent confirmation from the party that the bills produced by the assessee was bifurcated by misusing the letter head of M/s Agra Alu Trading Company. Thus, the A.O. treated the cash deposits in the bank account as unexplained. In so far as, agriculture receipt of Rs.10,60,000/- are also treated as Sham receipt of agriculture produce. As per Section 156(1) of UP Zameendari ITA No.50/Agr/2026 Sanjeev Tomar vs. ITO Page 6 of 7 Abolition Reforms Act, no ‘Bhoomadar' or ‘Asami’ shall let for any period whatsoever any land comprising in his holding. When there is specific bar that no land can be given on rent the assessee cannot have agriculture receipt of Rs. 10,60,000/-. Thus, in our opinion, the order of the assessment in making the addition of Rs. 10,60,000/- as unexplained by the A.O. which was confirmed by the CIT(A) is in order which requires no interference. Apart from the same, it is the specific ground of the assessee that no opportunity of cross- examination was given to the assessee on whose testimony the addition has been made. It is found from the record that at no point of time, the assessee sought for permission for cross- examination and on the other hand, the statement made by the parties have been confronted with the assessee and found that the assessee has fabricated the documents and produced before the A.O. Therefore, in our opinion, the grounds of Appeal of the assessee are devoid of merit. Accordingly, the Grounds of appeal of the assessee are rejected. 7. In the result, the Appeal filed by the assessee is dismissed. Order pronounced in open Court on 17 th August, 2023 Sd/- Sd/- (SHAMIM YAHYA) (YOGESH KUMAR U.S.) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated: 17/08/2023 Pk/R.N, Sr.ps ITA No.50/Agr/2026 Sanjeev Tomar vs. ITO Page 7 of 7 Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT ASSISTANT REGISTRAR ITAT, NEW DELHI