Vikas Roy, Ludhiana V. ITO, Ludhiana

ITA 732/CHANDI/2013

• Counselvise Citation: [2013] 140 COUNSELVISE.COM (IT) 68576 (ITAT-CHANDIGARH)
• Duration Of Justice: 5 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-11-2013
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 27-11-2013
• Assessment Year: 2008-2009
• Appeal Filed On: 19-06-2013
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: J S NAGAR
• Keywords: Business expenditure; Income from undisclosed sources
• Section: 68; 69

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL CHANDIGARH BENCH A CHANDIGARH BEFORE SHRI T.R.SOOD ACCOUNTANT MEMBER AND MS. SUSHMA CHOWLA, JUDICIAL MEMBER ITA NO.732/CHD/2013 ASSESSMENT YEAR : 2008-09 SHRI VIKAS ROY, VS THE INCOME TAX OF FICER, # 355, MODEL TOWN, WARD VI(3), LUDHIANA. LUDHIANA. PAN : AAPPR6570B (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI SUDHIR SEHGAL RESPONDENT BY : SHRI J.S.NAGAR DATE OF HEARING : 27.11.2013 DATE OF PRONOUNCEMENT : 28.11.2013 O R D E R PER SUSHMA CHOWLA, JM THE APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE CIT(APPEALS)-II, LUDHIANA DATED 12.04.2013 RELATING TO ASSESSMENT YEAR 2008-09 AGAINST THE ORDER PASSED UNDER SECTION 143( 3) OF THE INCOME- TAX ACT, 1961 ( 'THE ACT' FOR SHORT). 2. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL : 1. THAT THE LEARNED CIT(A) HAS ERRED IN CONFIRMING THE ADDITION OF RS. 13,83,000/- MADE BY THE ASSESSING OFFICER IN RESPEC T OF DEPOSITS IN A/C NO.913 WITH DENA BANK, LUDHIANA. 2. THAT THE LEARNED CIT(A) HAS ERRED IN NOT CONSIDE RING THAT THE ASSESSE IS A MAN OF LIMITED MEANS AND HIS SOURCE OF INCOME IS EARNING OF COMMISSION ON SALE AND PURCHASE OF SECOND HAND CARS AND AS SUCH DEPOSIT IN HIS BANK ACCOUNT DO NOT BELONG TO THE AS SESSE AND THAT THERE IS NEXUS OF THE DEPOSIT OF CASH IN BANK ACCOUNT ON ACC OUNT OF SALE OF CARS AND REMITTANCE OF THE PAYMENT TO THE OWNERS OF SUCH CARS. 3. THAT NOTWITHSTANDING THE ABOVE SAID GROUND OF AP PEAL, IT IS SUBMITTED THAT ADDITION AT ALL WAS TO BE MADE, THE SAME SHOULD HAVE BEEN OF PEAK DEPOSITS IN THE BANK ACCOUNT. 2 4 THAT THE LEARNED CIT(A) HAS ERRED IN CONFIRMING THE ADDITION OF RS.5 LACS IN THE CAPITAL ACCOUNT OF THE FIRM M/S NAND LA I MANN & CO. 5. THAT NOTWITHSTANDING THE ABOVE SAID GROUND OF APPEA L THE LEARNED CIT(A HAS ERRED IN NOT CONSIDERING THAT ADDITION AT ALL WAS TO BE MADE SHOULD HAVE BEEN MADE IN THE HANDS OF THE PARTNER O NLY. 3. THE ISSUE IN GROUND NOS. 1 & 2 IS AGAINST THE AD DITION OF RS. 13,83,000/-. THE BRIEF FACTS AS CONSIDERED BY THE C IT(APPEALS) ARE AS UNDER : 3.1 BRIEF FACTS ARE THAT AS PER INFORMATION RECEIV ED BY THE A.O. THE APPELLANT HAD EXCESS OF RS. 10LACS IN HIS BANK ACCO UNT. ON VERIFICATION OF THE BANK ACCOUNT, THE A.O. NOTED THAT APPELLANT HAD MADE A TOTAL CASH DEPOSIT OF RS. 13,83,000/- IN HIS BANK ACCOUNT. TH E AO ALSO OBSERVED THAT THE APPELLANT HAD NOT DISCLOSED THIS BANK ACCO UNT IN HIS RETURN OF INCOME. THE AO ASKED THE APPELLANT TO EXPLAIN THE S OURCE OF THE CASH DEPOSITS IN BANK ACCOUNT. THE AR OF THE APPELLANT E XPRESSED HIS INABILITY TO DISCLOSE THE SOURCE OF CASH DEPOSIT. T HE AO OBSERVED THAT APPELLANT HAD DISCLOSED RECEIPTS FROM BUSINESS AT R S. 1,85,000/- OUT OF WHICH HE HAD MADE BUSINESS EXPENSES. THE AO ALSO OB SERVED THAT ANOTHER RS. 41,808/-WERE INVESTED FOR CLAIMING DEDU CTION U/S 80C. THE APPELLANT WAS LEFT WITH ONLY RS. 71,190/- WHICH WAS NOT SUFFICIENT EVEN TO MEET THE HOUSEHOLD EXPENSES. IN THESE CIRCUMSTAN CES, THE AO HELD THAT THE CASH DEPOSITS AMOUNTING TO RS. 13,83,000/- IN THE BANK ACCOUNT REPRESENTED THE UNACCOUNTED INCOME OF THE APPELLANT AND ADDED THE SAME TO THE TOTAL INCOME OF THE APPELLANT U/S 69 OF THE ACT. 3.2 THE AQ ALSO NOTED THAT APPELLANT WAS A PAR TNER IN M/S NANDLAL MANN & CO. LUDHIANA AND HAD INTRODUCED 5 LACS AS A CAPITAL IN THE FIRM. THE AO ASKED THE APPELLANT TO FURNISH THE SOU RCE OF CAPITAL INTRODUCE BY THE APPELLANT IN THE FIRM. THE APPELLA NT ONCE AGAIN FAILED TO FURNISH ANY EXPLANATION. THE AO ACCORDINGLY HELD THAT THE AMOUNT OF CAPITAL INTRODUCED IN THE FIRM WAS APPELLANTS OWN UNACCOUNTED INCOME AND ADDED THE SAME TO THE TOTAL INCOME OF THE APPEL LANT UNDER SECTION 68 OF THE ACT. 4. THE ASSESSING OFFICER, REJECTING THE EXPLANATION OF THE ASSESSEE MADE AN ADDITION OF RS. 13,83,000/-. THE WRITTEN S UBMISSIONS FILED BY THE ASSESSEE BEFORE THE CIT(APPEALS) ARE REPRODUCED IN PARA 3.3 AT PAGES 3 3 TO 6 OF THE APPELLATE ORDER. THE LD. AR FOR THE ASSESSEE HAS PLACED RELIANCE ON THE SAID WRITTEN SUBMISSIONS. 5. THE CIT(APPEALS) VIDE PARA 3.4 HELD AS UNDER : 3.4 I HAVE CAREFULLY CONSIDERED THE APPELLANT'S SUBMISSION. THE CLAIM OF THE APPELLANT THAT THE AMOUNT DEPOSITED IN THE B ANK ACCOUNT DID NOT BELONG TO HIM ALONE IS A MERE SELF SERVING STATEMEN T. THE APPELLANT HAS NOT SUBMITTED ANY EVIDENCE IN SUPPORT OF HIS CLAIM THAT THE SHARE OF COMMISSION OF OTHER DEALERS WAS ALSO RECEIVED BY HI M AND WAS GIVEN TO THEM EITHER BY WITHDRAWING CASH FROM THE ACCOUNT OR DIRECTLY BY GIVING CHEQUES TO THEM. NEITHER ANY DETAILS I.E. NAMES & A DDRESSES OF THE PERSONS TO WHOM SHARE OF COMMISSION WAS CLAIMED TO HAVE BEEN GIVEN WAS FILED NOR ANY CONFIRMATION WITH REFERENCE TO TH E SAME WAS FILED. KEEPING IN VIEW THE FACTS OF THE CASE AS ALSO THE AMOUNT OF RECEIPTS SHOWN BY THE APPELLANT IN HIS RETURN OF INCOME, THE ASSESSING OFFICER WAS FULLY JUSTIFIED IN HOLDING THAT THE DEPOSITS IN BAN K ACCOUNT REPRESENTED UNACCOUNTED INCOME OF THE APPELLANT. THIS GROUND O F APPEAL IS DISMISSED. 6. THE LD. AR FOR THE ASSESSEE HAS FAILED TO CONTRO VERT THE FINDING OF CIT(APPEALS) THAT THE AMOUNT DEPOSITED IN THE BA NK ACCOUNT DID NOT BELONG TO HIM NOR ANY DETAILS OF COMMISSION PAID WE RE PRODUCED AND IN THE ABSENCE OF THE SAME, THE GROUND OF APPEAL NOS. 1 & 2 RAISED BY THE ASSESSEE ARE THUS, DISMISSED. 7. THE GROUND NO. 3 RAISED BY THE ASSESSEE IS NOT P RESSED AND HENCE, THE SAME IS DISMISSED AS NOT PRESSED. 8. THE ISSUE IN GROUND NOS. 4 & 5 RAISED BY THE ASS ESSEE IS IN RELATION TO THE ADDITION OF RS. 5,00,000/-. 9. THE LD. AR FOR THE ASSESSEE FURTHER PLACED RELIA NCE ON THE WRITTEN SUBMISSIONS FILED BEFORE THE CIT(APPEALS) I N THIS REGARD WHICH ARE REPRODUCED UNDER PARA 4.2 AT PAGES 6 & 7 OF THE APPELLATE ORDER. 10. THE CIT(APPEALS) VIDE PARA 4.3 HELD AS UNDER: 4.3 I HAVE CAREFULLY PERUSED THE APPELLANT'S SUBMIS SION. THE APPELLANT HAS FAILED TO EXPLAIN THE SOURCE OF CAPITAL INTRODUCED BY HIM IN THE PARTNERSHIP FIRM. THE APPELLANT HAS ONLY RAISED TECHNICAL OBJEC TIONS AGAINST THE ADDITION BY 4 CLAIMING THAT THE ADDITION ON THIS ACCOUNT CAN BE M ADE ONLY IN THE HANDS OF THE FIRM. I DO NOT AGREE WITH THE APPELLANT'S CONTENTIO N. THE APPELLANT HAS NOT DENIED THAT HE HAD INTRODUCED RS. 5 LACS AS CAPITAL IN THE FIRM. THAT BEING SO THE ONUS LIES ON THE APPELLANT TO EXPLAIN THE SO URCE OF THIS AMOUNT INTRODUCED AS CAPITAL IN THE FIRM. THE ADDITION MA DE BY THE ASSESSING OFFICER IS CONFIRMED. THIS GROUND OF APPEAL IS DIS MISSED. 11. IN VIEW OF THE ABOVE FACTS AND CIRCUMSTANCES, W HERE THE ASSESSEE HAS FAILED TO EXPLAIN THE SOURCE OF RS. 5,00,000/- INTRODUCED AS CAPITAL IN THE FIRM, WE DISMISS THE GROUNDS OF APPEAL RAISE D BY THE ASSESSEE. 12. IN THE RESULT, APPEAL OF THE ASSESSEE IS DISMIS SED. ORDER PRONOUNCED IN THE OPEN COURT ON 28 TH NOVEMBER,2013. SD/- SD/- ( T.R.SOOD) (SUSHMA CHO WLA) ACCOUNTANT MEMBER JUD ICIAL MEMBER DATED: 28 TH NOVEMBER,2013 POONAM COPY TO: THE APPELLANT, THE RESPONDENT, THE CIT(A), THE CIT, DR ASSISTANT REGISTRAR ITAT,CHD.