Shri Gaurangkumar Jaysukhlal Vakharia, Mehsana V. The Income Tax Officer, Ward-1, Mehsana

ITA 745/AHD/2017

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 0252 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 3 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-06-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: misc
• Appeal Filed On: 27-03-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SUMIT KUMAR VARMA
• Assessee Lawyers: S N DIVATIA
• Keywords: Peak credit
• Section: 250; 147; 148

Judgement Text

, SMC IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH, AHMEDABAD BEFORE SHRI SUDHANSHU SRIVASTAVA, JUDICIAL MEMBER & SHRI AMARJIT SINGH, ACCOUNTANT MEMBER ./ I.T.A. NO. 745/AHD/2017 ( / ASSESSMENT YEAR : 2008-09) GAURANGKUMAR JAYSUKHLAL VAKHARIA D-1001, GALA SWING, NEAR SOBO CENTRE, SOUTH BOPAL, AHMEDABAD- 380058 / VS. ITO WARD-1, MAHSENA ./ ./ PAN/GIR NO. : ABU PV7 809 B ( / APPELLANT ) .. ( / RESPONDENT ) / APPELLANT BY : SHRI S.N. DIVATIA, AR / RESPONDENT BY : SHRI SUMIT KUMAR VARMA, SR. DR / DATE OF HEARING 25/06/2019 !'# / DATE OF PRONOUNCEMENT 28/06/2019 $%/ O R D E R PER SUDHANSHU SRIVASTAVA - JM: THIS APPEAL HAS PREFERRED BY THE ASSESSEE AGAINST T HE ORDER PASSED BY THE LD. CIT (A), GANDHINAGAR (HEREINAFTER CALLED THE CIT(A)) FOR ASSESSMENT YEAR 2008-09 WHEREIN, VIDE THE IMPUGNED ORDER, THE LD. CIT(A) HAS UPHELD ADDITION OF RS. 46 ,38,137/- PERTAINING TO CERTAIN DEPOSITS IN THE ASSESSEES BA NK ACCOUNT. 2.0 THE BRIEF FACTS OF THE CASE ARE THAT THE ASSES SEE IS AN INDIVIDUAL AND DERIVES INCOME BY WAY OF COMMISSION AND SHARE IN ITA NO. 745/AHD/2017 [GAURANGKUMAR JAYSUKHLAL VAKHARIA VS. ITO] A.Y. 2008-09 - 2 - PARTNERSHIP FIRM M/S. GAYATRI POLY PRINT. THE RETU RN OF INCOME WAS FILED DECLARING TOTAL INCOME OF RS. 1,10,860/-. BAS ED ON ANNUAL INFORMATION REPORT, THE ASSESSING OFFICER (AO) CAME TO KNOW THAT THE ASSESSEE HAD MADE CASH DEPOSITS OF RS. 24,89,85 0/- IN HIS SAVINGS BANK ACCOUNT WITH KOTAK MAHINDRA BANK. THE REFORE, THE ASSESSEES CASE WAS REOPENED UNDER SEC. 147 OF THE INCOME TAX ACT, 1961 (HEREINAFTER CALLED THE ACT). 2.1 IN RESPONSE TO THE NOTICE UNDER SEC. 148 OF THE ACT, THE ASSESSEE REQUESTED THAT THE ORIGINAL RETURN FILED B Y HIM MAY BE TREATED AS THE RETURN FILED HIS COMPLIANCE TO THE N OTICE UNDER SEC. 148. IT WAS THE ASSESSEES CONTENTION BEFORE THE A O THAT HE HAD BEEN ADVISED BY HIS INVESTMENT CONSULTANT THAT THE FIRM COULD NOT MAKE INVESTMENT IN SHARES/MUTUAL FUNDS AND, THEREFO RE, THE ASSESSEE HAD WITHDRAWN FUNDS FROM THE FIRM AND HAD DEPOSITED THE FUNDS IN THE SAID BANK ACCOUNT. IT WAS SUBMITTED THAT THE C ASH DEPOSITS WERE RELATABLE TO THE CASH WITHDRAWN FROM THE FIRM. HOW EVER, THE AO PROCEEDED TO MAKE AN ADDITION OF RS. 46,38,137/- ON THIS ACCOUNT. 2.2 THE ASSESSEES APPEAL BEFORE THE LD. FIRST APPE LLATE AUTHORITY WAS ALSO DISMISSED BY NOTING THAT THE ASSESSEE HAS NOT SUBMITTED COPY OF PERSONAL CASH BOOK, DETAILS OF MUTUAL FUNDS , LEDGER OF CASH BALANCE OF FUND ETC. ITA NO. 745/AHD/2017 [GAURANGKUMAR JAYSUKHLAL VAKHARIA VS. ITO] A.Y. 2008-09 - 3 - 2.3 NOW, THE ASSESSEE IS BEFORE THE TRIBUNAL (ITAT) AGAINST THE DISMISSAL OF THE ASSESSEES APPEAL BY THE LD. CIT ( A) AND HAS RAISED THE FOLLOWING GROUNDS OF APPEAL:- 1.1 THE ORDER PASSED U/S. 250 ON 09.11.2016 FOR A. Y. 2008-09 BY CIT(A)-GNR, CONFIRMING ADDITION OF RS. 46,38,137/-, IS WHOLLY ILLEGAL, UNLAWFUL AND AGAINST THE PRINCIPLES OF NAT URAL JUSTICE. 1.2 THE LD. CIT(A) HAS GRIEVOUSLY ERRED IN LAW AND OR ON FACTS IN CONFIRMING THE IMPUGNED ADDITION WITHOUT INTIMATING THE SO-CALLED DEFICIENCY IN THE MATERIAL PRODUCED BEFORE HIM. 2.1 THE LD. CIT(A) HAS GRIEVOUSLY ERRED IN LAW AND OR ON FACTS IN UPHOLDING THE CASH DEPOSITS MADE DURING THE YEAR IN SB ACCOUNT NO. 13066 WITH KOTAK MAHINDRA BANK AS UNDISCLOSED INCOM E AND THEREBY CONFIRMING AN ADDITION OF RS.46,38,137/- AS UN DISCLOSED DEPOSITS. 2.2 THAT IN THE FACTS AND CIRCUMSTANCES OF THE CASE AS WELL AS IN LAW, THE ID. CIT(A) HAS GRIEVOUSLY ERRED IN LAW AND OR ON FACTS IN UPHOLDING THE CASH DEPOSITS MADE DURING THE YEAR IN SB ACCOUNT NO. 13066 WITH KOTAK MAHINDRA BANK AS UNDISCLOSED INCOM E AND THEREBY CONFIRMING AN ADDITION OF RS.46,38,137/- AS UNDISCL OSED DEPOSITS. 3.1 THE LD. CIT(A) OUGHT TO HAVE ACCEPTED THE EXPLA NATION FURNISHED BY THE APPELLANT IN RESPECT OF THE CASH D EPOSITS MADE IN THE SAID BANK ACCOUNT. 4.1 WITHOUT PREJUDICE TO ABOVE, THE LD. CIT(A) OUGH T TO HAVE ALLOWED CREDIT FOR THE CASH WITHDRAWN AND RE-DEPOSI TED AND THEREBY RESTRICTED THE ADDITION TO THE PEAK CREDIT. IT IS THEREFORE PRAYED THAT THE ADDITION OF RS.46, 38,137/-MADE BY THE AO AND CONFIRMED BY CIT(A) SHOULD BE DELETED . 3.0 THE LD. AUTHORISED REPRESENTATIVE (AR) SUBMITTE D THAT VOLUMINOUS DETAILS HAD BEEN SUBMITTED BY THE ASSESSEE BEFORE T HE AO IN THIS REGARD. HE DREW OUR ATTENTION TO THE COPIES OF VARIOUS DOCU MENTS FILED BEFORE THE AO AND WHICH WERE PLACED IN THE PAPER BOOK. IT WAS THE LD. AUTHORISED REPRESENTATIVES CONTENTION THAT ALL THE RELEVANT D ETAILS HAD BEEN FILED BEFORE THE AO BUT THE SAME HAD NOT BEEN CONSIDERED IN THE PROPER PERSPECTIVE. ITA NO. 745/AHD/2017 [GAURANGKUMAR JAYSUKHLAL VAKHARIA VS. ITO] A.Y. 2008-09 - 4 - 4.0 IN RESPONSE, THE LD. SENIOR DEPARTMENTAL REPRES ENTATIVE (SR. DR) EMPHASIZED THAT THE LD. CIT (A) HAD GIVEN A CATEGOR ICAL OBSERVATION THAT THE REQUISITE DETAILS WERE NOT SUBMITTED BY THE ASS ESSEE AND, THEREFORE, THE ASSESSEES CONTENTION REGARDING CASH WITHDRAWAL FRO M THE FIRM AND DEPOSITS IN THE PERSONAL BANK ACCOUNT WAS NOT ACCEPTABLE. H E ALSO SUBMITTED THAT THE LD. CIT (A) HAS GIVEN A FINDING THAT THE ASSESS EE HAD SUBMITTED DETAILS OF CASH WITHDRAWAL ONLY TO THE TUNE OF RS. 13,20,00 0/- WHEREAS THE DEPOSITS WERE TO THE TUNE OF RS. 24,89,850/-. IT WAS PRAYED THAT THE ASSESSEES APPEAL SHOULD BE DISMISSED AS NO COGENT EVIDENCES A ND EXPLANATION HAD BEEN FORTHCOMING FROM THE ASSESSEE. 5.0 WE HAVE HEARD THE RIVAL SUBMISSIONS AND HAVE AL SO PERUSED THE MATERIAL ON RECORD. WE NOTE THAT THE ASSESSEE HAS FILED VOLUMINOUS DETAILS BEFORE THE AO WHICH ARE PLACED IN THE PAPER BOOK. HOWEVER, WE ALSO NOTE THAT MOST OF THE DOCUMENTS WHICH ARE SUBMITTED IN T HE FORM OF PAPER BOOK ARE SELF-GENERATED DOCUMENTS AND A CO-RELATION BETW EEN THE WITHDRAWALS FROM THE FIRM AND THE DEPOSITS IN THE BANK ACCOUNT OF THE ASSESSEE IS NOT CLEARLY ESTABLISHED. IT IS ALSO SEEN FROM THE ASSE SSMENT ORDER THAT ALTHOUGH THE CASH DEPOSITS IN THE BANK WERE TO THE TUNE OF R S. 24,89,850/-, THE AO HAS MADE AN ADDITION OF RS. 46,38,137/-. THIS PLEA WAS RAISED BY THE ASSESSEE BEFORE THE LD. CIT (A) BUT THE SAME HAS NO T BEEN ADJUDICATED BY THE LD. CIT (A). EVIDENTLY, THERE IS CONTRADICTION IN THE FACTUAL ASPECTS OF THE CASE AND IT IS ALSO APPARENT THAT THE ASSESSEE HAS NOT PROVIDED THE REQUIRED INFORMATION TO THE LOWER AUTHORITIES IN A WAY THAT THE ISSUE COULD BE DISPOSED OF. THEREFORE, ON THE FACTS OF THIS CA SE, IT IS OUR CONSIDERED OPINION THAT THE ISSUE NEEDS RE-EXAMINATION BY THE AO. ACCORDINGLY, THE ITA NO. 745/AHD/2017 [GAURANGKUMAR JAYSUKHLAL VAKHARIA VS. ITO] A.Y. 2008-09 - 5 - ISSUE IS RESTORED TO THE FILE OF THE AO WITH A DIRE CTION TO RE-EXAMINE THE ISSUE AFTER GIVING PROPER OPPORTUNITY TO THE ASSESS EE. WE ALSO DIRECT THE ASSESSEE TO MAKE ALL POSSIBLE ENDEAVOR TO CO-RELATE THE DEPOSITS WITH THE WITHDRAWALS MADE FROM THE FIRM BY PRODUCING BOOKS O F ACCOUNT OF THE PARTNERSHIP FIRM BEFORE THE AO RATHER THAN FILING C OPY OF LEDGER ACCOUNTS ONLY. WE ALSO DIRECT THE ASSESSEE TO FULLY COOPERAT E IN THE ASSESSMENT PROCEEDINGS WHEN CALLED UPON TO DO SO FAILING WHICH THE AO SHALL BE AT LIBERTY TO PASS THE ORDER AS PER THE PROVISIONS OF LAW EX-PARTE QUA THE ASSESSEE. 6.0 IN THE FINAL RESULT, THE APPEAL OF THE ASSESS EE STANDS ALLOWED FOR STATISTICAL PURPOSES. SD/- SD/- (AMARJIT SINGH) (SUDHANSHU SRIV ASTAVA) ACCOUNTANT MEMBER JUDICIAL MEMBER AHMEDABAD: DATED 28/06/2019 TANMAY TRUE COPY !' #' / COPY OF ORDER FORWARDED TO:- 1. / REVENUE 2. $ / ASSESSEE 3. ) *+ , / CONCERNED CIT 4. ,- / CIT (A) 5. 012 33*+, *+#, 56$)$ / DR, ITAT, AHMEDABAD 6. 289 : / GUARD FILE. BY ORDER / $% , ;/5 *+#, 56$)$ < THIS ORDER PRONOUNCED IN OPEN COURT ON 2 8/06/2019