Sh. Mahindra Pal Singh, Ghaziabad V. ITO, Ghaziabad

ITA 5166/DEL/2013

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 6787 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 5 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-02-2016
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: E
• Next Hearing Date: 02-02-2016
• Assessment Year: 2009-2010
• Appeal Filed On: 10-09-2013
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: AMRIT LAL SR DR RAVI JAIN
• Section: 69

Judgement Text

1 ITA NO. 5166/DEL/20 13 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: E NEW DELHI BEFORE SHRI J. SUDHAKAR REDDY, ACCOUNTANT MEM BER AND SMT SUCHITRA KAMBLE , JUDICIAL MEMBER I.T.A .NO.- 5166/DEL/2013 (ASSESSMENT YEA R-2009-10) MAHINDRA PAL SINGH 5/4, SECTOR-5 RAJENDRA NAGAR, SAHIBABAD GHAZIABAD BGPPS1122R (APPELLANT) VS ITO WARD-1(4) GHAZIABAD (RESPONDENT) APPELLANT BY SH. VIVEK KUMAR JAIN, CA, SANDEEP JAIN, CA RESPONDENT BY SHRI AMRIT LAL, SR. DR, RAVI JAIN, CIT DR ORDER PER SUCHITRA KAMBLE, JM THIS APPEAL IS FILED AGAINST THE ORDER DATED 3/6/20 13 PASSED BY LD. CIT (A)S GHAZIABAD. 2. THE GROUNDS OF APPEAL ARE AS FOLLOWS:- 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE ORDER PASSED BY THE LEARNED COMMISSIONER OF INCOME TAX DATE OF HEARING 02.02.2016 DATE OF PRONOUNCEMENT 15.02.2016 2 ITA NO. 5166/DEL/20 13 APPEALS [LD. CIT (A)] IS BAD BOTH IN THE EYE OF LAW AND ON FACTS. 2. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD. CIT (A) HAS ERRED, BOTH ON FACTS AND IN LAW, IN PAR TIALLY CONFIRMING THE ORDER PASSED U/S 143, AND ENHANCING THE INCOME ON SOME ISSUES. 3. ON THE FACTS AND CIRCUMSTANCES OF THE CASE,, THE LD. CIT (A) HAS ERRED BOTH ON FACTS AND IN LAW IN CONFI RMING THE ADDITION OF RS.17, 71,500/- MADE BY A.O ON ACCO UNT OF PEAK CASH CREDIT. 4. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) HAS ERRED BOTH ON FACTS AND IN LAW IN ENHANC ING THE AMOUNT OF PEAK CASH CREDIT TO RS.18,25,500/-. 5. ON THE FACTS AND CIRCUMSTANCES OF THE CASE,, THE LD. CIT(A) HAS ERRED BOTH ON FACTS AND IN LAW IN MAKING THE ENHANCEMENT BY ADDING RS. 7,21,748/- ON ACCOUNT OF DISALLOWANCE U/S 40A (3) TO THE INCOME OF THE ASSES SEE ARBITRARY REJECTING THE MATERIAL & EVIDENCES BROUGH T ON RECORD BY THE ASSESSEE. 6. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) HAS ERRED BOTH ON FACTS AND IN LAW IN IGNORI NG THE CONTENTION OF THE ASSESSEE THAT THE ABOVE SAID ADDI TIONS HAS BEEN MADE BY A.O BY ARBITRARY REJECTING THE MAT ERIAL & EVIDENCES BROUGHT ON RECORD BY THE ASSESSEE. 3. THE ASSESSEE IS AN INDIVIDUAL AND FILED HIS RETU RN ON 6/7/2009 FOR TOTAL INCOME OF RS.1, 54,570/-, THE ASSESSEE IS RUNNING THE BUSINESS OF BUILDING MATERIAL SUPPLY IN THE NAME AN D STYLE OF M/S SINGH BUILDING MATERIAL SUPPLIER. THE ASSESSEE HAS SHOWN GROSS RECEIPTS OF RS. 9,67,840/-AND GROSS PROFIT OF RS.2, 45,960/- AND NET PROFIT OF RS.1,93,568/-, THE ASSESSING OFFICER HAS MADE AN ADDITION 3 ITA NO. 5166/DEL/20 13 RELATED TO CASH DEPOSITS OF RS.17,71,500/- IN THE B ANK ACCOUNT OF THE ASSESSEE BY HOLDING THAT THE SAME ARE UNEXPLAIN ED CASH CREDITS WITHIN THE MEANING OF SECTION 68, THE ASSESSING OFF ICER ALSO MADE AN ADDITION OF RS.24,10,030/- AS RELATES TO SHARE O F THE ASSESSEE IN THE PROPERTY WHICH IS HELD TO BE 50% AND THE 50% AM OUNT OF INVESTMENT HOLDING THAT THE SAME ARE UNEXPLAINED IN VESTMENT OF THE ASSESSEE WITHIN THE MEANING OF SECTION 69 OF TH E ACT. AGGRIEVED BY THE ORDER THE ASSESSEE WENT BEFORE THE LD. CIT ( A). THE LD. CIT(A) PARTLY ALLOWED THE ASSESSEES APPEAL BUT ENH ANCED THE ADDITION ON ACCOUNT OF PEAK CASH CREDIT TO RS.18,25 ,500/-. THE LD. CIT (A) FURTHER DIRECTED THE ASSESSING OFFICER TO M AKE AN ADDITION OF RS.7, 21,748/- U/S 40 A (3) OF THE INCOME-TAX ACT, 1961). 4. THE LD. AR SUBMITTED THAT PASS BOOK CANNOT BE TA KEN AS BOOK OF ACCOUNT. THE PROFIT DECLARED WAS ONLY TO THE EXT ENT OF 20% AND THE ASSESSING OFFICER WHILE MAKING AN ADDITION TO T HE EXTENT OF 17, 71,500/- HAS NOT TAKEN INTO CONSIDERATION THE STATE MENT OF ACCOUNT WHICH WAS PRODUCED BEFORE HIM. THE LD. AR FURTHER STATED THAT THE INVOCATION OF SECTION 40A (3) IS NOT PROPER AS THE ASSESSEE HAS GIVEN HIS COMPUTATION OF ACCOUNTS CLEARLY THAT THE ESTIMA TED PROFIT AS PER PROVISIONS OF SECTION 44 AF OF THE INCOME-TAX ACT W HICH WAS AT 20% IN RESPECT OF SALE OF RS.9,67,840/-. 5. THE LD. DR STATED THAT THERE WAS NO CLAIM AT ANY POINT BY THE ASSESSEE RELATED TO SECTION 44 AF WHEN THE ASSESSEE IS NOT MAINTAINING ANY BOOK OF ACCOUNT, THERE IS NO QUESTI ON OF CASH ACCOUNT DETAILS GIVEN TO THE ASSESSING OFFICER. 4 ITA NO. 5166/DEL/20 13 6. WE HAVE PERUSED ALL THE RECORDS AND HEARD BOTH T HE PARTIES. THE GROUND NOS. 1 & 2 ARE GENERAL IN NATURE HENCE D ISMISSED. AS RELATED TO GROUND NO. 3 ADDITION OF RS. 17,71,500/- ON ACCOUNT OF PEAK CASH CREDIT, THE ASSESSEE HAS PRODUCED ALL THE DETAILS BEFORE THE ASSESSING OFFICER AND THERE WAS NO REASONING B Y THE ASSESSING OFFICER AS WELL AS BY THE LD. CIT(A) FOR REJECTING THE SAID DETAILS GIVEN BY THE ASSESSEE IN THAT RESPECT. GROUND NO. 3 IS ALLOWED. AS RELATED TO GROUND NO. 4 THE DETAILS WERE GIVEN TO L D. CIT (A) BY THE ASSESSEE AND ALSO BEFORE THE ASSESSING OFFICER , TH EREFORE, THE ENHANCING THE AMOUNT OF PEAK CASH CREDIT TO RS.18,2 5,500/- DOES NOT SUSTAIN. THEREFORE, GROUND NO.4 IS ALLOWED. A S RELATED TO GROUND NO. 5, THE COMPUTATION OF ACCOUNT WAS VERY M UCH BEFORE THE ASSESSING OFFICER AS WELL AS LD. CIT(A), AND TH EREFORE, THE CONTENTION OF LD. DR THAT INVOCATION OF SECTION 44A F WAS COMING FOR THE FIRST TIME DOES NOT SURVIVE. THEREFORE, GR OUND NO. 5 IS ALSO ALLOWSED. 7. IN RESULT, APPEAL IS PARTLY ALLOWED. THE ORDER IS PRONOUNCED IN THE OPEN COURT ON 15TH OF FEBRUARY, 2016. SD/- SD/- (J. SUDHAKAR REDDY) (SUCHITRA KAMBLE) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 15/02/2016 R. NAHEED * 5 ITA NO. 5166/DEL/20 13 COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT R EGISTRAR ITAT NEW DELHI DATE 1. DRAFT DICTATED ON .02.02.2016 PS 2. DRAFT PLACED BEFORE AUTHOR .03.02.2016 PS 3. DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER .2016 JM/AM 4. DRAFT DISCUSSED/APPROVED BY SECOND MEMBER. JM/AM 5. APPROVED DRAFT COMES TO THE SR.PS/PS 16.02.02.2016 PS/PS 6. KEPT FOR PRONOUNCEMENT ON PS 7. FILE SENT TO THE BENCH CLERK 16 .02.2016 PS 8. DATE ON WHICH FILE GOES TO THE AR 9. DATE ON WHICH FILE GOES TO THE HEAD CLERK. 10. DATE OF DISPATCH OF ORDER. 6 ITA NO. 5166/DEL/20 13