Sh. Jitender Kumar, New Delhi V. ACIT, New Delhi

ITA 6127/DEL/2013

• Counselvise Citation: 612720114 RSA 2013
• Duration Of Justice: 1 year(s) 9 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-08-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Next Hearing Date: 31-07-2015
• Assessment Year: 2004-2005
• Appeal Filed On: 14-11-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SAMEER SHARMA
• Assessee Lawyers: ANURAV KUMAR
• Keywords: Unexplained cash credit; Search and seizure; Opportunity of being heard; Accommodation entries
• Section: 68; 148; 132

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES : D NEW DELHI BEFORE SHRI S.V.MEHROTRA, ACCOUNTANT MEMBER AND SHRI I.C.SUDHIR, JUDICIAL MEMBER ITA NO: 6127/DEL/2013 ASSTT. YEAR : - 2004-05 JITENDER KUMAR VS. ACIT 13/34, W.E.A. KAROL BAGH CENTRAL CIRCLE-4, NEW DELHI. NEW DELHI 110 005. (PAN AAMPJ0062B (APPELLANT) (RESP ONDENT) APPELLANT BY : SHRI ANURAV KUMAR, ADVOCATE RESPONDENT BY : SHRI SAMEER SHARMA, SR. DR DATE OF HEARING : 31.07.2015 DATE OF PRONOUNCEMENT : 27 .8.2015 O R D E R PER I.C.SUDHIR, JM 1. THIS IS AN APPEAL FILED BY THE ASSESEE AGAINST T HE ORDER DATED 19.08.2013 PASSED BY CIT (A) - XXXII RAISING THE FOLLOWING GRO UNDS OF APPEAL:- 1. THAT THE CIT(A) ERRED IN NOT APPRECIATING THAT SIN CE THE APPELLANT IS ADMITTEDLY PART OF TARUN GOYAL GROUP , IT HAD TO BE CONSIDERED AS SUCH AND DECISION IN THE CASE OF ASSESSEE COULD BE TAKEN CONSIDERING THE FACTS IN TOTALITY AS HAVE BEEN NOTED AND DISCUSSED BY THE ASSESSING OFFICER IN THE ASSESSMENT ORDER AND ADDITION COULD NOT BE MADE AND UPHELD CONSIDERING THE APPELLANT AS A SEPARATE INDEPENDENT ASSESSEE. 2. THAT THE CIT(A) ERRED IN UPHOLDING THE ADDITION OF RS. 3,70,400/- BEING THE CASH DEPOSITS IN THE BANK ACCOUNT OF THE APPELL ANT COMPANY WITHOUT APPRECIATING THAT ADMITTEDLY THE APPELLANT WAS BEIN G CONTROLLED BY MR. ITA NO.6127/DEL/2013 JITENDER K UMAR VS. ACIT 2 TARUN GOYAL AND HE WAS CARRYING ON THE BUSINESS OF PROVIDING ACCOMMODATION ENTRIES THROUGH VARIOUS ENTITIES, INC LUDING THE APPELLANT AND THE CASH WAS DEPOSITED IN THE BANK ACCOUNT OF T HE APPELLANT DURING THE COURSE OF THE ABOVE BUSINESS AND FOR PROVIDING ENTRIES FROM THE ACCOUNT OF APPELLANT AS WELL AS FROM OTHER COMPANIE S AND , THEREFORE , CASH DEPOSITED IN THE FACTS OF THE CASE COULD NOT B E ADDED UNDER SECTION 68 OF THE INCOME TAX ACT IN THE CASE OF THE APPELLA NT. 3. THAT THE CIT(A) ALSO FAILED TO APPRECIATE THAT IN T HE FACTS OF THE CASE OF THE APPELLANT THERE IS NO POSSIBILITY TO EARN SUCH AN AMOUNT AS AN INCOME AND THEREFORE ADDITION ON ACCOUNT OF CASH DEPOSIT C OULD NOT BE MADE AS UNDISCLOSED INCOME U/S 68 OF THE ACT IN VIEW OF THE DECISION OF SUPREME COURT IN THE CASE OF CIT VS. SMT. P. K. NOORJAHAN, 237 ITR 570 (SC) AND CIT VS. BHARAT ENGINEERS & CONSTRUCTION CO. 83 ITR 187 (SC). 4. THAT THE CIT(A) ALSO FAILED TO APPRECIATE THAT, WIT HOUT PREJUDICE TO GROUNDS HEREINABOVE, THERE COULD ONLY BE COMMISSION INCOME IN RESPECT OF TRANSACTIONS OF CASH DEPOSITS AND THAT TOO WAS A SSESSABLE IN THE ASSESSMENT OF MR. TARUN GOYAL, WHO, IN FACT, HAD AL READY DISCLOSED COMMISSION INCOME IN HIS RETURN OF INCOME. 2. THE BRIEF FACTS LEADING TO THE PRESENT A PPEAL ARE AS FOLLOWS :- THE APPELLANT IS AN INDIVIDUAL. HE HAS FILED RETURN OF INCOME FOR THE ASSESSMENT YEAR 2004-05 ON 18.10.2004 DECLARING TOT AL INCOME OF RS. 1,40,231/- . SUBSEQUENTLY SEARCH AND SEIZURE OPERATION PASSED U/S 132 OF THE INCOME TAX ACT, 1961 WAS CONDUCTED ON 15.9.2008 AT THE GROUP C ONCERN OF ONE MR. TARUN GOYAL. AS A RESULT OF SEARCH AND SEIZURE OPERATION, IT WAS FOUND THAT BANK ACCOUNT NO. 31000323141 WITH HDFC BANK, K. G. MARG , DELHI BELONGS TO THE APPELLANT. FROM THE BANK STATEMENT, IT WAS FOUND TH AT A SUM OF RS. 3,70,400/- WAS DEPOSITED IN CASH ON VARIOUS DATES. CONSEQUENT LY ON THE BASIS OF THIS INFORMATION, THE ASSESSMENT PROCEEDINGS WERE REOPEN ED BY ISSUING NOTICE U/S 148 ON 29 TH MARCH, 2011. ITA NO.6127/DEL/2013 JITENDER K UMAR VS. ACIT 3 3. DURING THE COURSE OF REASSESSMENT PROCEED INGS, APPELLANT WAS PUT ON NOTICE AS TO WHY SAID CASH DEPOSITED SHOULD NOT BE ADDED AS INCOME AND CASH DEPOSIT SHOULD NOT BE BROUGHT TO TAX. IT WAS EXPLAI NED TO THE AO THAT THE APPELLANT WAS ONLY EARNING COMMISSION UNDER SUCH CA SH DEPOSITS AND NO OTHER EXPLANATION IS FURNISHED TO THE AO. THEREFORE, THE AO MADE ADDITION OF RS. 3,70,400/-. REASSESSMENT WAS COMPLETED VIDE ORDER D ATED 30.11.2011. AGGRIEVED BY THIS ORDER OF ASSESSMENT, THE APPELLAN T HAD PREFERRED AN APPEAL BEFORE THE COMMISSIONER OF INCOME TAX (APPEALS) XXX III, NEW DELHI WHO VIDE ORDER DATED 19 TH AUGUST, 2013 DISMISSED THE APPEAL BY HOLDING THAT THE APPELLANT DID NOT OFFER SATISFACTORY EXPLANATION FO R THE SOURCE OF THE CASH DEPOSITS IN BANK ACCOUNT. AGGRIEVED, THE PRESENT AP PEAL WAS FILED BEFORE US. 4. IT WAS SUBMITTED ON BEHALF OF THE APPELL ANT THAT IN THE SIMILAR CASES THIS TRIBUNAL IN ITA NO. 4636 & 4637/DEL/2012 AS WELL AS IN ITA NO. 6126/DEL/2013 HAS RESTORED THE MATTER TO THE FILE O F AO FOR FRESH ADJUDICATION. THE OPERATIVE PORTION OF THE ORDER IS AS UNDER :- 22. ADMITTEDLY CERTAIN ASSESSMENT OF SHRI TARUN G OYAL, THE KIN PIN ARE AT VARIOUS STAGES AND HAVE NOT REACHED THE TRIBUNAL . UNDER THESE CIRCUMSTANCES, IT WOULD NOT BE POSSIBLE TO HAVE IN OVER ALL VIEW OF THE MATTER AND ELIMINATE CHAIN / MULTIPLE TRANSACTI ON, FOR ARRIVING AT THE CORRECT ASSESSABLE AMOUNT. THUS WE HAVE NO O THER ALTERNATIVE BUT TO SET ASIDE ALL THESE APPEALS TO T HE FILE OF THE AO FOR FRESH ADJUDICATION IN ACCORDANCE WITH LAW. 23. THE AO SHALL AFTER EXAMINING THE EVIDENCE SUBMI TTED BY THE ASSESSEE, CONSIDER ALL THE CASES TOGETHER AND; A) RESTRICT THE ADDITION U/S 68 TO ONLY THE PEAK UNEXPLAINED CREDIT IN EACH CASE AFTER ELIMINATION CIRCULAR TRANSACTION . ITA NO.6127/DEL/2013 JITENDER K UMAR VS. ACIT 4 B) TO ELIMINATE TAXATION OF THE SAME AMOUNT MULTIP LE TIMES, DUE TO THE CHAIN TRANSACTIONS WHICH RESULTED DUE TO LAYERI NG INDULGED BY THE ASSESSEE. C) CONSIDER THE MATERIAL ON RECORD AND THE PRECEDE NCE AVAILABLE ON THE ISSUE AND DETERMINE THE PERCENTAGE OF COMMIS SION, WHICH THE ASSESSEES WOULD HAVE EARNED AND BRING THE SAME TO TAX. 5. SINCE THE PRESENT CASE ALSO BELONGS TO THE SAM E GROUP HAVING ALMOST SIMILAR FACTS AND HAVING NEXUS WITH THE ASSESSMENT PROCEEDINGS OF MR. TARUN GOYAL, WE RESTORE THE MATTER TO THE FILE OF THE AO TO DECIDE THE ISSUE AFRESH AS DIRECTED HERE IN ABOVE IN THE GROUP MATTER BY THE I TAT, AFTER AFFORDING OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. THE GRO UNDS ARE THUS ALLOWED FOR STATISTICAL PURPOSES. 6. IN THE RESULT, THE APPEAL IS ALLOWED FOR ST ATISTICAL PURPOSE. ORDER PRONOUNCED IN THE OPEN COURT ON 27 AU GUST, 2015. SD/- SD/- (S.V.MEHROTRA) (I.C.SUDHIR) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 27.08.2015 BINITA COPY OF THE ORDER FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR 6. GUARD FILE BY ORDER DY. REGISTRAR