Sh. Niranjan Kumar, Muzaffarnagar V. ITO, Muzaffarnagar

ITA 6826/DEL/2014

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 97208 (ITAT-DELHI)
• Duration Of Justice: 8 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-09-2015
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: SMC 1
• Next Hearing Date: 14-08-2015
• Assessment Year: 2006-2007
• Appeal Filed On: 18-12-2014
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: GARIMA JAIN SENIOR
• Assessee Lawyers: ANKIT GUPTA
• Section: 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL DELHI DELHI DELHI DELHI BENCH BENCH BENCH BENCH SMC SMC SMC SMC- -- -1 11 1 : NEW DELHI : NEW DELHI : NEW DELHI : NEW DELHI BEFORE SHRI G.C. GUPTA BEFORE SHRI G.C. GUPTA BEFORE SHRI G.C. GUPTA BEFORE SHRI G.C. GUPTA, VICE , VICE , VICE , VICE PRESIDENT PRESIDENT PRESIDENT PRESIDENT ITA NO ITA NO ITA NO ITA NO . .. . 6826/DEL/2014 6826/DEL/2014 6826/DEL/2014 6826/DEL/2014 ASSESSMENT YEAR ASSESSMENT YEAR ASSESSMENT YEAR ASSESSMENT YEAR : : : : 2006 2006 2006 2006 - -- - 07 0707 07 SHRI NIRANJAN KUMAR, SHRI NIRANJAN KUMAR, SHRI NIRANJAN KUMAR, SHRI NIRANJAN KUMAR, 464/104, SUMAN VIHAR, 464/104, SUMAN VIHAR, 464/104, SUMAN VIHAR, 464/104, SUMAN VIHAR, MUZAFFARNAGAR. MUZAFFARNAGAR. MUZAFFARNAGAR. MUZAFFARNAGAR. PAN : AMFPK9993F. PAN : AMFPK9993F. PAN : AMFPK9993F. PAN : AMFPK9993F. VS. VS. VS. VS. INCOME TAX OF INCOME TAX OF INCOME TAX OF INCOME TAX OF FICER, FICER, FICER, FICER, WARD WARD WARD WARD- -- -1(1), 1(1), 1(1), 1(1), MUZAFFARNAGAR. MUZAFFARNAGAR. MUZAFFARNAGAR. MUZAFFARNAGAR. (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI ANKIT GUPTA, ADVOCATE. RESPONDENT BY : MS. GARIMA JAIN, SENIOR DR. DATE OF HEARING : 14.08.2015 14.08.2015 14.08.2015 14.08.2015 DATE OF PRONOUNCEMENT : 08.09.2015 08.09.2015 08.09.2015 08.09.2015 ORDER ORDER ORDER ORDER THIS APPEAL BY THE ASSESSEE FOR THE ASSESSMENT YEAR 2006-0 7 IS DIRECTED AGAINST THE ORDER OF LEARNED CIT(A), MUZAF FARNAGAR DATED 21 ST OCTOBER, 2014. 2. THE EFFECTIVE GROUND OF APPEAL OF THE ASSESSEE IS GR OUND NO.4, WHICH IS REPRODUCED HEREUNDER:- THAT, IN VIEW OF THE FACTS AND CIRCUMSTANCES, THE AO/CIT(A) HAS ERRED IN LAW AND ON FACTS IN MAKING THE ADDITION OF RS.3,00,000/- TO THE INCOME OF THE APPEL LANT ON THE ACCOUNT UNEXPLAINED CASH DEPOSIT UNDER SECTION 68 OF THE INCOME TAX ACT, 1961. THE CIT(A) HAS ALSO ERRED IN UPHOLDING THE SAME. 3. LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE ASS ESSEE HAS DEPOSITED A SUM OF `2 LAKHS AND `1 LAKH MAKING AN A GGREGATE OF `3 LAKHS DURING THE YEAR OUT OF CLEARING OF CHEQUE OF ` 3 LAKHS ISSUED BY ITA-6826/DEL/2014 2 THE FIRM M/S J.K.M. STEELS. HE SUBMITTED THAT THE LEA RNED CIT(A) HAS SUSTAINED THE ADDITION OF `3 LAKHS ON THE GROUND THAT THE ASSESSEE COULD NOT EXPLAIN THE BUSINESS EXPEDIENCY FOR MAKING A WITHDRAWAL OF `3 LAKHS ON THE DATE OF CLEARING OF CHEQUE OF `3 LAK HS ON 24.09.2005 ISSUED BY M/S J.K.M. STEELS. LEARNED CIT(A) HAS OBSERVED THAT THE IMPUGNED SUM OF `3 LAKHS WAS KEPT BY THE ASSESSEE IN CASH F OR OVER FOUR MONTHS AND, THEREFORE, THE ASSESSEE HAS MADE A COOKE D-UP STORY WITHOUT ANY BASIS. LEARNED COUNSEL FOR THE ASSESSEE SUBMIT TED THAT THERE IS NO LAW THAT THE ASSESSEE COULD NOT KEEP A SUM OF `3 LAKHS IN CASH WITH HIM OVER A PERIOD OF ABOUT FOUR MONTHS. 4. LEARNED DR HAS RELIED ON THE ORDER OF THE ASSESSING OFFICER AND THE LEARNED CIT(A). 5. I HAVE CONSIDERED THE RIVAL SUBMISSIONS AND HAVE PERU SED THE ORDER OF THE AO AND THE LEARNED CIT(A). I FIND THA T THE FACT OF THE ASSESSEE HAVING RECEIVED A CHEQUE OF `3 LAKHS FROM M/S J. K.M. STEELS ON 24.09.2005, WHICH WAS DEPOSITED IN THE BANK ACCOUN T OF THE ASSESSEE, IS NOT IN DISPUTE. THE ASSESSEE HAS MADE A WITHDRA WAL OF `3 LAKHS ON THE SAME DAY I.E. 24.09.2005 AND THE CASH DEP OSIT WAS MADE ON 31.02.2006 AND 24.03.2006 BY THE ASSESSEE AND THE SOU RCE IS EXPLAINED AS THAT OF WITHDRAWAL MADE FROM THE BANK A CCOUNT ITSELF ON 24.09.2005 AFTER RECEIVING THE CHEQUE FROM M/S J.K.M . STEELS. I FIND THAT THERE IS NO BASIS FOR THE LEARNED CIT(A) TO OBSER VE THAT IMPUGNED SUM OF `3 LAKHS KEPT BY THE ASSESSEE FOR OVER FOUR MONTHS IN CASH IS A COOKED-UP STORY. IN THESE FACTS OF THE CASE AND IN THE ABSENCE OF ANY MATERIAL BROUGHT ON RECORD TO SUGGEST THAT THE ASSESSEE HAS UTILIZED THE WITHDRAWAL OF `3 LAKHS MADE FROM HIS BANK ACCOUNT IN CREATION OF SOME ASSET OR MAKING SOME EXPENDITURE ETC., I HOLD THAT THE ASSESSEE HAS EXPLAINED THE SOURCE OF DEPOSIT IN ITS BANK ACCOUN T AND NO CASE FOR ITA-6826/DEL/2014 3 ADDITION COULD BE MADE BY THE DEPARTMENT. ACCORDIN GLY, THE ADDITION OF `3 LAKHS IS DELETED AND GROUND NO.4 IS ALLOWED. 6. THE OTHER EFFECTIVE GROUND OF APPEAL OF THE ASSESSEE IS GROUND NO.6, WHICH READS AS UNDER:- 6. THAT, IN VIEW OF THE FACTS AND CIRCUMSTANCES, THE ASSESSING OFFICER HAS ERRED IN LAW AND ON FACTS IN MAKING THE ADHOC ADDITION OF RS.73,050/- TO THE INCOME OF T HE APPELLANT ON THE ACCOUNT OF HALWAI ACTIVITY AND INC OME FROM OTHER SOURCES. THE CIT(A) HAS ALSO ERRED IN UPH OLDING THE SAME. 7. I HAVE HEARD THE PARTIES. I FIND THAT THE ASSESSEE W AS HAVING A HALWAI BUSINESS AND WAS ENGAGED IN DELIVERING HALWAI G OODS HOME TO HOME AND THE ADDITION OF `73,050/- WAS MADE BY THE A SSESSING OFFICER ON ACCOUNT OF NO PROPER DETAILS OR EVIDENCE FILED BY THE ASSESSEE IN SUPPORT OF ITS INCOME SHOWN FROM THE HALWAI ACTIVITIES. THE ASSESSEE HAS SHOWN INCOME FROM OTHER SOURCES AT `12,000/- BUT NO DETAILS THEREOF WERE FURNISHED. THE HOUSEHOLD WITHDRAWALS AT `30,000/- WERE CONSIDERED INADEQUATE. IN THESE FACTS OF THE CASE, I AM OF THE VIEW THAT THE ASSESSING OFFICER WAS JUSTIFIED IN MAKING THE IM PUGNED ADDITION OF `73,050/- BY WAY OF ESTIMATE, WHICH IS ACCORDINGLY CONFIRMED, AND GROUND NO.6 OF THE ASSESSEES APPEAL IS DI SMISSED. 8. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS PARTLY AL LOWED. DECISION PRONOUNCED IN THE OPEN COURT ON 8 TH SEPTEMBER, 2015. SD/- (G. (G. (G. (G. C. GUPTA C. GUPTA C. GUPTA C. GUPTA ) )) ) VICE PRESIDENT VICE PRESIDENT VICE PRESIDENT VICE PRESIDENT VK. ITA-6826/DEL/2014 4 COPY FORWARDED TO: - 1. APPELLANT : SHRI NIRANJAN KUMAR, SHRI NIRANJAN KUMAR, SHRI NIRANJAN KUMAR, SHRI NIRANJAN KUMAR, 464/104, SUMAN VIHAR, MUZAFFARNAGAR. 464/104, SUMAN VIHAR, MUZAFFARNAGAR. 464/104, SUMAN VIHAR, MUZAFFARNAGAR. 464/104, SUMAN VIHAR, MUZAFFARNAGAR. 2. RESPONDENT : INCOME TAX OFFICER, WARD INCOME TAX OFFICER, WARD INCOME TAX OFFICER, WARD INCOME TAX OFFICER, WARD- -- -1(1), MUZAFFARNAGAR. 1(1), MUZAFFARNAGAR. 1(1), MUZAFFARNAGAR. 1(1), MUZAFFARNAGAR. 3. CIT 4. CIT(A) 5. DR, ITAT ASSISTANT REGISTRAR