Shri Sachin Sharma, New Delhi V. ITO, New Delhi

ITA 5711/DEL/2011

• Counselvise Citation: 571120114 RSA 2011
• Duration Of Justice: 7 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-08-2012
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: G
• Next Hearing Date: 09-08-2012
• Assessment Year: 2007-2008
• Appeal Filed On: 21-12-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SURJANI MOHANTY
• Assessee Lawyers: O P SAPRA
• Keywords: Opportunity of being heard
• Section: 234B

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH : G : NEW DELHI SHRI I. C. SUDHIR, JUDICIAL MEMBER AND SHRI T.S. KAPOOR, ACCOUNTANT MEMBER ITA NO. 5711/DEL/2011 ASSESSMENT YEAR: 2007- 2008 SHRI SACHIN SHARMA VS. INCOME TAX OFFICER C/O O.P. SAPRA & ASSOCIATES, WARD-25(2), C-763, NEW FRIENDS COLONY, NEW DELHI. NEW DELHI 110 025 (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI O.P. SAPRA, A DVOCATE RESPONDENT BY : SMT . SURJANI MOHANTY, SR. DR ORDER PER I.C. SUDHIR, JUDICIAL MEMBER THE ASSESSEE HAS QUESTIONED FIRST APPEL LATE ORDER ON THE GROUNDS THAT THE LD. CIT(A) WAS NOT JUSTIFIED IN UPHOLDING THE ADDITION OF RS. 5,08,405/- MADE ON ACCOUNT OF UNEXPLAINED SOURCE TH EREOF AND IN UPHOLDING THE LEVY OF INTEREST U/S 234B AND 234D OF THE ACT. 2. AT THE OUTSET OF HEARING THE LD. AR SUBMITT ED THAT BEFORE THE AUTHORITIES BELOW THE ASSESSEE WHO IS IN THE BUSINE SS OF RETAIL TRADE OF CERTAIN GARMENTS HAD TRIED TO EXPLAIN THE CASH DEPO SITS IN ITS BANK ACCOUNT TO THE TUNE OF RS. 41,78,700/-. IT EXPLAINED THAT T HE DEPOSITS TOTALING TO RS. 36,70,295/- REPRESENT THE CASH SALES AND THE BALANC E OF RS. 5,08,405/- ITA NO. 5711/DEL/2011 2 REPRESENT THE DEPOSITS MADE OUT OF THE CASH WITHDRA WALS. THE AUTHORITIES BELOW DID NOT ACCEPT EXPLANATION WITH THIS OBSERVAT ION THAT IN THE TYPE OF ACCOUNTS MAINTAINED BY THE ASSESSEE, THE CASH WITHD RAWALS WOULD BE UTILIZED FOR PURCHASES. FOR BETTER UNDERSTANDING OF THE TRANSACTION IN QUESTION THE ASSESSEE HAS PREPARED A CASH FLOW STAT EMENT ON THE BASIS OF DEPOSITS AND WITHDRAWALS TO EXPLAIN THE SOURCE OF T HE DEPOSITS OF RS. 5,08,405/- WITH AN APPLICATION UNDER RULE 29 OF ITA T RULE TO ALLOW THE SAME FOR THE CONSIDERATION ON THE ISSUE. HE REFERR ED PAGE NP. 20 TO 46 OF THE PAPER BOOK WHEREIN A COPY OF THE SAID CASH FLOW STATEMENT FOR THE PERIOD 1.4.2006 TO 31.3.2007 HAS BEEN MADE AVAILAB LE. HE SUBMITTED THAT THE SAID CASH FLOW STATEMENT WAS NOT FILED BEFORE T HE AUTHORITIES BELOW BECAUSE THE ASSESSEE WAS UNDER A GENUINE AND BONAFI DE BELIEF THAT ASSESSEES EXPLANATION WITH REGARD TO DEPOSITS IN T HE BANK ACCOUNT, COPY OF WHICH HAS BEEN PLACED AT PAGE NOS. 4 TO 17 OF THE P APER BOOK, WILL BE ACCEPTED. IT IS ON RECEIPT OF THE FIRST APPELLATE O RDER THE ASSESSEE FOUND THAT HIS EXPLANATION HAS NOT BEEN ACCEPTED AND THEREFORE THE CASH FLOW STATEMENT HAS BEEN PREPARED AND FILED TO MEET OUT T HE END OF JUSTICE. 3. LD. DR OPPOSED THE ABOVE APPLICATION. 4. CONSIDERING THE ABOVE SUBMISSIONS AND IN THE INTEREST OF JUSTICE WE ALLOW THE APPLICATION AND SET ASIDE THE MATTER TO T HE FILE OF THE AO TO EXAMINE THE CORRECTNESS OF THE CASH FLOW STATEMENT FURNISHED BY THE ASSESSEE TO EXPLAIN THE SOURCE OF RS. 5,08,405/- AN D DECIDE THE ISSUE AFRESH ITA NO. 5711/DEL/2011 3 AFTER AFFORDING OPPORTUNITY OF BEING HEARD TO THE A SSESSEE. SO FAR AS LEVY OF INTEREST U/S 234B AND 234D IS CONCERNED THE AO IS D IRECTED TO CONSIDER THE SAME AFRESH IN VIEW OF THE OUTCOME ON THE ABOVE ISS UE. THE GROUNDS ARE THUS ALLOWED FOR STATISTICAL PURPOSES. 5. IN THE RESULT APPEAL IS ALLOWED FOR STATISTIC AL PURPOSE. ORDER IS PRONOUNCED IN THE OPEN COURT ON 9.8 .2012. SD/- SD/- (T.S. KAPOOR) ( I.C. SUDHIR ) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED *VEENA COPY OF ORDER FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT(A) 4. CIT 5. DR BY ORDER DEPUTY REGISTRAR, ITAT