ITO 18(3)(3), MUMBAI V. MAQSOOD AHMED KADRI, MUMBAI

ITA 6820/MUM/2014

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 3354 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 6 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-06-2016
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2010-2011
• Appeal Filed On: 10-11-2014
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: SACHCHIDANAND DUBE
• Keywords: Peak credit
• Section: 143(3); 68

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, MUMBAI BEFORE SHRI MAHAVIR SINGH , JM AND SHRI RAJESH KUMAR, AM ./ I.T.A. NO. 6820 /MUM/20 1 4 ( / ASSESSMENT YEA R : 20 10 - 11 ) INCOME TAX OFFICER 1 8 ( 3 ) (3) , ROOM NO. 2 11, 1ST FLOOR, PIRAMAL CHAMBERS, PAREL, MUMBAI - 400012. / VS. SHRI MAQSOOD AHMED KADRI, 109, BUILDING NO.8, BALIGA NAGAR, JASMINE MILL ROAD, MAHIUM (E), MUMBAI - 400017 ./ PAN : APUPK1722J / REVENUE BY SHRI SACHCHIDANAND DUBE / ASSESSEE BY SHRI BHADRESH DOSHI / DATE OF HEARING : 0 2. 0 6 .2016 / DATE OF PRONOUNCEMENT : 02.0 6 .2016 / O R D E R PER B ENCH : TH IS APPEAL OF THE REVENUE IS DIRECTED AGAINST THE ORDER OF CIT(A) DATED 20.08.2014 FOR THE ASSESSMENT YEARS 20 10 - 11 . THE ASSESSMENT WAS FRAMED BY THE ASSESSING OFFICER FOR THE ASSESSMENT YEAR 2010 - 11 VIDE ORDER DATED 14.3.2013 U/S 143(3) OF THE INCOME TAX ACT, 1961 (THE ACT). 2 . THE ONLY ISSUE IN THIS APPEAL OF REVENUE IS AGAINST THE ORDER OF CIT(A) RESTRICTING THE ADDITION MADE BY THE AO U/S 68 OF THE ACT AT RS.2,21,165/ - AS 2 6820 /M/1 4 AGAINST THE ADDITION MADE BY THE AO OF RS.56,48,88 0/ - BY TAKING THE PEAK CREDIT FROM THE WITHDRAWAL AND DEPOSITS OF THE SAVING BANK ACCOUNT. 3 . BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE IS AN INDIVIDUAL DOING THE BUSINESS THE BUSINESS OF PLASTIC SCRAP. THE ASSESSEE HAS FILED HIS RETURN OF INCOME DE CLARING THE INCOME OF RS.2,70,670/ - . SUBSEQUENTLY, AIR INFORMATION WAS RECEIVED THAT THE ASSESSEE HAS MAINTAINED BANK ACCOUNT WITH ICICI BANK HAVING SAVING BANK ACCOUNT NUMBER 032001508494 AND IN HIS BANK ACCOUNT THERE ARE TOTAL SEVEN DEPOSITS DURING TH E YEAR AND CASH WAS DEPOSITED AMOUNTING TO RS.56,48,880/ - . THE AO REQUIRED THE ASSESSEE TO EXPLAIN THE CASH DEPOSITS IN TERMS OF SECTION 68 OF THE ACT. AS THE ASSESSEE COULD NOT EXPLAIN, THE AO TREATED THE ENTIRE CASH DEPOSITED IN THE BANK ACCOUNT A S UNEXPLAINED INCOME OF THE ASSESSEE AMOUNTING TO RS.56,48,880/ - . AGGRIEVED, THE ASSESSEE PREFERRED THE APPEAL BEFORE THE CIT(A). THE CIT(A) AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE RESTRICTED THE ADDITION TO THE EXTENT OF PEAK AMOUNT OF CASH DE POSITS IN THE BANK AMOUNTING TO RS.2,21,165/ - BY OBSERVING AS UNDER : 15. THE FACTS OF THE PRESENT CASE ARE SIMILAR TO THE FACTS DISCUSSED IN THE ABOVE DECISIONS. THE FACTS STATED ABOVE BRINGS OUT THE CLEARLY THE CIRCUMSTANCES THAT THOUGH THERE IS A UNUSU AL TREND OF CASH WITHDRAWALS AND FOLLOWED BY CASH DEPOSITS IN THE BANK ACCOUNT, YET THERE IS NO DENYING THE FACT THAT THE AO HAS NOT BROUGHT ON RECORD ANY EVIDENCE TO PROVE THAT THE CASH WITHDRAWN BY THE APPELLANT WAS USED FOR ANY OTHER PURPOSES EXCEPT FOR MAKING CASH DEPOSITS AND THE CASH AMOUNT WAS NOT AVAILABLE IN THE HANDS OF THE APPELLANT AS A SOURCE FOR DEPOSITING THE SAME INTO THE BANK ACCOUNT. IN THE ABSENCE OF ANY SUCH EVIDENCE, THE APPELLANT CANNOT BE DENIED THE BENEFIT OF CASH AMOUNTS WITHDRAWN F ROM THE SAME BANK ACCOUNT. THE CASH WITHDRAWALS ARE AT RS.57,20,900/ - AS AGAINST THE CASH 3 6820 /M/1 4 DEPOSITS AMOUNTING TO RS.56,48,880/ - IN THE BANK ACCOUNT OF THE APPELLANT SO THERE APPEARS TO BE A PRIMA FACIE CASE OF THE SAME MONEY B EING ROTATED TIME AND AGAIN. 16. IN THE CIRCUMSTANCES EXPLAINED ABOVE IN MY CONSIDERED OPINION IT WOULD BE APPROPRIATE IF THE ADDITION ON ACCOUNT OF CASH DEPOSITS IS RESTRICTED TO PEAK CREDIT IN THE BANK ACCOUNT, WHICH IS RS.2,21,165/ - AS ON 12/12/2009 DURING THE YEAR UNDER CONSIDERAT ION. THUS THE ADDITION AMOUNTING TO RS.2,21,165/ - IS SUSTAINED AND THE BALANCE ADDITION MADE BY THE AO IS DELETED. THE AO HAS NOT BROUGHT ON RECORDS WHICH REVEAL THAT THE CASH WITHDRAWN FROM TIME TO TIME FROM THE SAME SAVINGS BANK ACCOUNT AGGREGATING TO RS .57,20,900/ - HAVE BEEN UTILIZED BY THE APPELLANT FOR SOME OTHER PURPOSES AND THEREFORE WERE NOT AVAILABLE IN THE HANDS OF THE APPELLANT AS A SOURCE FOR DEPOSITING THE SAME INTO THE BANK ACCOUNT. THEREFORE, I AM OF THE OPINION THAT ADDITION SHOULD BE RESTRI CTED TO RS.2,21,165/ - BEING THE PEAK CREDIT IN THE IMPUGNED SAVINGS BANK ACCOUNT OF THE APPELLANT AS ON 12.12.2009. AGGRIEVED BY THE ORDER OF THE CIT(A), NOW THE REVENUE IS IN SECOND APPEAL BEFORE THE TRIBUNAL. 4 . WE HAVE CONSIDERED THE RIVAL CONTENTI ONS AND PERUSED THE RECORD PLACED BEFORE US. WE FIND THAT THE ASSESSEE HAS FILED THE DETAILS OF CASH DEPOSITS AND CASH WITHDRAWALS IN THE BANK ACCOUNT BEFORE THE CIT(A) FOR THE FIRST TIME. THE ASSESSEE HAS GIVEN THE PEAK CREDIT CALCULATION FOR THE FIRST TIME IN WHICH IT WAS ADMI TT ED THE PEAK CREDIT CAN BE ADDED AS UNEXPLAINED DEPOSITS IN T HE BANK ACCOUNT TO THE EXTENT OF RS.2,21,165/ - . THE ASSESSEE ALSO CLAIMED THAT THESE AMOUNTS A RE CASH WITHDRAWALS FROM TIME TO TIME FROM HIS SAVING BANK ACCOUNTS FO R TH E PURPOSE OF BUSINESS AND UNUTILIZED CASH WAS DEPOSITED IN THE SAME BANK ACCOUNT. WE FIND FROM THE BANK ACCOUNT STATEMENT PRODUCED BEFORE CIT(A) THAT 4 6820 /M/1 4 THERE AS CASH WITHDRAWALS AND CASH DEPOSITS . FURTHER, THERE IS NO DENIAL THAT THE AO HAS BROUGHT ON RECO RD ANY EVIDENCE OR ANY FINDING RECORDED BY HIM THAT THE CASH WITHDRAWN BY THE ASSESSEE WA S UTILIZED FOR THE PURPOSE OF MAKING INVESTMENT OR FOR INCURRING ANY EXPENDITURE. IN VIEW OF THESE FACTS , WE ARE OF T HE VIEW THAT THE C IT(A) HAS RIGH T LY HELD THAT THE ASSESSMENT ON THE ASSESSES SHOULD BE BASED ON PEAK CREDIT WITH RESPECT TO T HE BANK DEPOSITS . NEITHER THE AO NOR T HE CIT(A) HAS GONE INTO THE DETAILS OF PEAK CREDIT SUBMITTED BY THE ASSESSEE . I N THE EVENTUALITY OF THE FACTS , WE ARE OF THE VIEW THAT LET THIS ISSUE BE EXAMINED BY THE AO . THE AO WILL GO INTO PEAK CREDIT OF THE ASSESSEE AND ON THE BASIS OF CORRECT PEAK CREDIT OF THE ASSESSEE ON CASH DEPOSITS AND WITHDRAWALS IN THE BANK ACCOUNT AND DETERMINED THE CORRECT FIGURE . WE DIRECT THE AO ACCORDINGL Y. 5 . IN THE RESULT, ALL THE APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 2 ND JUNE , 201 6 S D SD ( RAJESH KUMAR) ( MAHAVIR SIN GH ) / ACCOUNTANT MEMBER / JUDICIAL MEMBER MUMBAI ; DATED : 02 . 0 6 .2016 SR.PS:SRL: 5 6820 /M/1 4 / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT 3. ( ) / THE CIT(A) 4. / CIT CONCERNED 5. , , / DR, ITAT, MUMBAI 6. / GUA RD F ILE / BY ORDER, T RUE COPY [ / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI