Ram Bhagvanbhai Karmata, Veraval V. Income Tax Officer, Junagadh

ITA 59/RJT/2024

• Counselvise Citation: [2024] 130 COUNSELVISE.COM (IT) 4540 (ITAT-RAJKOT)
• Duration Of Justice: 7 month(s) 6 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-09-2024
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 21-08-2024
• Assessment Year: 2017-2018
• Appeal Filed On: 28-01-2024
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SHAKEEL ANSARI; LD.
• Assessee Lawyers: DEVINA PATEL; LD
• Keywords: Set aside; Business income; Opportunity of being heard; Unexplained cash credit
• Section: 69

Judgement Text

आयकर अपील य अ धकरण, राजकोट यायपीठ, राजकोट। IN THE INCOMETAXAPPELLATE TRIBUNAL, RAJKOT BENCH: RAJKOT BEFORE DR. ARJUN LAL SAINI, ACCOUNTANT MEMBER And SHRI DINESH MOHAN SINHA, JUDICIAL MEMBER आयकरअपीलसं./I.T.A. No.59/RJT/2024 ( नधा रणवष / Assessment Year :2017-18) Ram BhagvanbhaiKarmata MatruashishPetrolium Junagadh-VeravalRoad At Gadhu Taluka MaliyaHantina Veraval – 362 255 (Gujarat) बनाम/ Vs. The Income Tax Officer Ward-2, Junagadh थायीलेखासं./जीआइआरसं./PAN/GIR No. :ANDPK 1490 Q (अपीलाथ /Appellant) .. ( यथ / Respondent) Assessee by : Ms. Devina Patel, Ld.AR Revenue by : Shri Shakeel Ansari, Ld.Sr.DR स ु नवाईक!तार ख/ Date of H e ar i ng 22/08/2024 घोषणाक!तार ख /Date of Pr on ounc e me nt 05/09/2024 आदेश / O R D E R PER DINESH MONHAN SINHA, JUDICIALMEMBER : Captioned appeal filed by the Assessee pertaining to Assessment Year (AY) 2017-18 is directed against the order passed by the Learned Commissioner of Income Tax - National Faceless Appeal Centre (NFAC), Delhi[(in brief “Ld.CIT(A)”] vide order dated 18/12/2023, which in turn arises out of assessment order dated 24/12/2019passed by the Income Tax Officer, Ward-2, Junagadh u/s.143(3) of the Income Tax Act, 1961 (in short, “the Act”) pertaining to Assessment Year (AY) 2017-18. 2. The grounds of appeal raised by the Assessee are as follows: ITA No.59/RJT/2024 Ram Bhagvanbhai Karmata vs. ITO Asst.Year–2017-18 - 2 - “1. The learned Commissioner (Appeals) erred in dismissing the appeal of the Appellant ex-parte by failing to appreciate that the Appellant was interested in pursuing the appeal filed by him before the CIT(A). 2. The learned Commissioner (Appeals), erred in upholding action of the Income-tax Officer, Ward - 2, Junagadh in making addition of Rs.15,43,379/- u/s 68 of the Act by way of unexplained cash credits, being cash receipt from Bhutvad branch of Rs.8,22,306/-, cash capital introduced by the appellant of Rs.3,00,000/-, cash deposit from one Shri Khimaiben of Rs.1,19,500/-, agriculture income of Rs.1,81,573/- and cash receipt from personal account of Rs.1,20,000/-. 3. The learned Commissioner (Appeals), erred in upholding the action of the Income-tax Officer, Ward - 2, Junagadh in making addition of Rs.11,83,138/- u/s 69 of the Act, being diesel expenses for generator of Rs.7,30,662/-, tanker diesel expenses of Rs.2,57,976/- , driver, cleaner salary and travelling expenses of Rs.1,94,500/-. 4. The appellant craves leave to add, amend, alter or withdraw all or any ground of appeal at any time upto the date of hearing of the appeal.” 3. The brief facts of the case are that the assessee is an individual running petrol pump in the name and style of M/s.Matruashish Petroleum at Village Gadhu, Taluka Maliya Hatina, Dist. Junagadh. The assessee filed its return of income for the year under consideration on 01/12/2017 declaring total income of Rs.8,03,140/- as business income and also declared an agriculture income of Rs.1,81,570/-. The case was selected for scrutiny under CASS. During demonetization period (9th November, 2016 to 30th December, 2016), assessee has deposited aggregate cash of Rs.79,52,500/- in SBN notes in its bank account Nos. 35862082575 & 35931050487 maintained with State Bank of India and A/c No. 16912000000537 maintained with HDFC Bank Ltd. The assessee was requested to explain the source of said cash deposits. 3.1. The assessee has recorded in its books of account as per the details shown below:- ITA No.59/RJT/2024 Ram Bhagvanbhai Karmata vs. ITO Asst.Year–2017-18 - 3 - Sr.No. Date Cash introduced (in Rs.) Particulars (narration as per cash book) 1. 01.04.2016 8,22,306 Receipt from Dhoreji pump branch 2. 15.04.2016 3,00,000 Cash capital introduced by RambhaiKaramte(your) 3. 20.04.2016 1,19,500 Cash deposit from Khilmalben B. Karameta 4. 13.05.2016 1,00,000 Cash receipt from SBI, JND saving A/c. 5. 16.06.2016 20,000 -DO- 6. 30.09.2016 3,04,220 Cash sales vide bill No.152035 to 152700 (on any other day bill No.are not entioned.) 7. 15.10.2016 1,81,573 Rambhai Agriculture Income 4. The Income Tax Officer issued show-cause issued on 10/12/2019 and the assessee replied thereof. The AO after considering the reply of the assessee, assessed the income of the assessee. The source of cash deposited to the extent of Rs.27,26,517/- as per working given as under is treated as unexplained and hence, addition of Rs.15,43.379/- is made u/s.68 of the I.T. Act and Rs.11,83,138/- brought to tax u/s. 69 of the I.T. Act. Sr.No. Particulars Amount 1. Cash receipt from Bhutvad (Dhoraji) Branch 8,22,306 2. Cash capital introduced by RambhaiKaramta 3,00,000 3. Cash deposit from Khimaiben B. Karamate 1,19,500 4. Agriculture income 1,81,573 5. Diesel expenses for generator 7,30,662 6. Tanker Diesel expenses 2,57,976 7. Driver, cleaner salary and travelling expenses 1,94,500 8. Cash receipt from personal account 1,20,000 Total 27,26,517 Subject to the above remarks, total income of the assessee is computed as under: Income form other source as per return of income Rs. 8,03,140/- Add: Addition u/s.68 & 69 of the I.T. Act as discussed At para 3 above Rs.27,26,517/- Total Income Assessed Rs.35,29,657/- Rounded off Rs.35,29,660/-” ITA No.59/RJT/2024 Ram Bhagvanbhai Karmata vs. ITO Asst.Year–2017-18 - 4 - 5. Aggrieved by the order of the AO, the assessee carried the matter before the Ld.CIT(A), who has passed an order dated 18/12/2023 by observing that the assessee has not complied with the notices dated 02/02/2014, 04/11/2022, 06/10/2023, 03/11/2023 and 20/11/2023 issued to the assessee. Since there was no compliance on the part of the assessee, the Ld.CIT(A) dismissed the appeal of the Assessee. 5.1. During the course of hearing before us, the Ld.AR submitted that the assessee was not aware of the notice issued by the AO and assessee may be given an opportunity of hearing and also requested to set aside the order of the Ld. CIT(A). 6. On the other hand, the Ld. DR objected the arguments of the Ld.AR and submitted that there was a huge cash deposit made by the assessee during demonetization period. He further submitted that there was a negligent approach of the assessee for non-compliance of notice by the assessee and relied on the order of the Ld. CIT(A). 7. We have heard both the parties and perused the material available on record. Since the assessee has appeared before the AO and complied with all notices dated 02/02/2021, but and submitted all documents/evidences/details pertaining to his claim during the course of assessment proceedings. The request of the Ld.AR to provide one more opportunity to the assessee since assessee was not aware about the notices. However, it is observed that the Ld.CIT(A)’s order dated 18.12.2023 is silent, on service of the notice to the assessee impugned order speak about issue of notice never talked about the service of notice on the assessee. In view of the matter and looking to the facts and circumstances of the case, we set aside the order of the Ld.CIT(A) and remit the matter to the file of Ld.CIT(A) for fresh adjudication in accordance ITA No.59/RJT/2024 Ram Bhagvanbhai Karmata vs. ITO Asst.Year–2017-18 - 5 - with law, after giving an opportunity of being heard to the assessee. Therefore, appeal of the assessee is allowed for statistical purposes. 8. In the result, the appeal of the assessee is treated as allowed for statistical purposes. Order pronounced in the Open Court on 05.09.2024 Sd/- Sd/- (DR. ARJUN LAL SAINI) (DINESH MOHAN SINHA) ACCOUNTANT MEMBER JUDICIAL MEMBER Rajkot; Dated 05/09 /2024 TRUE COPY आदेश क त ल प अ े षत/Copy of the Order forwarded to : 1. अपीलाथ / The Appellant 2. यथ / The Respondent. 3. संबं धत आयकर आय ु *त / Concerned CIT 4. आयकर आय ु *त(अपील) / The CIT(A)-(NFAC), Delhi. 5. /वभागीय 2त2न ध, आयकर अपील य अ धकरण,राजोकट/DR,ITAT, Rajkot 6. गाड? फाईल / Guard file. आदेशान ु सार/BY ORDER, स या/पत 2त //True Copy// उप/सहायक पंजीकार (Dy./Asstt.Registrar) आयकर अपील%य अ&धकरण,राजोकट / ITAT, Rajkot 1. Date of dictation ..22.08.2024(dictation-pad 5-pages attached at the end of this File) 2. Date on which the typed draft is placed before the Dictating Member ...27.08.2024 3. Other Member... 4. Date on which the approved draft comes to the Sr.P.S./P.S. 03.09.2024 5. Date on which the fair order is placed before the Dictating Member for pronouncement...... 6. Date on which the fair order comes back to the Sr.P.S./P.S....... 05.09.2024 7. Date on which the file goes to the Bench Clerk 05.09.2024 8. Date on which the file goes to the Head Clerk.......................................... 9. The date on which the file goes to the Assistant Registrar for signature on the order.......................... 10. Date of Dispatch of the Order..................