Suresh Kumar Bhatia, Delhi V. ITO, Ward-47(5), New Delhi

ITA 7595/DEL/2018

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 3218 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 3 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-03-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2010-2011
• Appeal Filed On: 30-11-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Unexplained cash credit; Business income; Set aside
• Section: 43

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: SMC, NEW DELHI BEFORE SH. H.S. SIDHU, JUDICIAL MEMBER ITA NO. 7595/DEL/2018 ASSESSMENT YEAR: 2010-11 SURESH KUMAR BHATIA, PROP. M/S SUPER MAX PHARMA, 1705, AGF ONKAR BHAWAN, BAGIRATH PALACE, NEW DELHI 110 006 (PAN: AEZPB7214A) VS. ITO, WARD 47(5), NEW DELHI (APPELLANT) (RESPONDENT) ORDER THE ASSESSEE HAS FILED THE APPEAL AGAINST THE IMPUG NED ORDER DATED 30.08.2018 PASSED BY LD. CIT(A)-16, NEW DELHI RELE VANT TO ASSESSMENT YEAR 2010-11 ON THE FOLLOWING GROUNDS:- 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) HAS ERRED IN LAW AND ON FACTS IN SUSTAINING THE ADDITION OF RS. 43,46,300/- ON ACCOUNT OF UNEXPLAINED CASH CREDIT. 2. THAT THE AUTHORITIES BELOW HAVE FAILED TO APPRECIATE THAT IN THE ASSESSMENT YEAR 2009-10 AND SUBSEQUENT ASSESSMENT YEAR 2011-12, SB NO. 0551930003747 OF THE APPELLANT WITH HDFC BANK, CHADNI CHOWK, DELHI 110 006, WAS FOUND BY THE ASSESSEE BY SH. SANJAY CHOPRA, CA DEPARTMENT BY MS. PARUL SINGH, SR. DR. 2 DEPARTMENT BEING USED FOR THE BUSINESS ACTIVITIES OF THE APPELLANT AND CASH DEPOSITS THEREIN WERE TREATED AS BUSINESS RECEIPTS AND BROUGHT TO TAX AFTER ALLOWING ESTIMATED EXPENSES. AS THE FACTUAL POSITION REMAINED THE SAME AS IN THE ASSESSMENT YEAR 2009-10 AND 2011-12 AND IN THE ABSENCE OF ANY MATERIAL ON RECORD TO HOLD OTHERWISE, THERE WAS NO JUSTIFICATION TO TREAT THE TOTAL AMOUNT CASH DEPOSITS OF RS. 43,46,300/- AS UNEXPLAINED CASH CREDIT AND ADDITION MADE ON MERE SURMISES AND CONJECTURE IS LIABLE TO BE DELETED. 3. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE THE AUTHORITIES BELOW HAVE FURTHER ERRED IN LAW AND ON FACTS IN TREATING THE CASH DEPOSITS OF RS. 43,46,300/- AS UNEXPLAINED CASH CREDIT MERELY ON GROUND OF NOT DISCLOSING THE BANK ACCOUNT BY THE APPELLANT IN HIS BOOKS OF ACCOUNT. SUCH AN APPROACH IS WHOLLY ARBITRARY AND LIABLE TO BE SET ASIDE. 4. THAT THE APPELLANT CRAVES LEAVE TO ADD, AMEND, ALTER AND / OR VARY ANY OF THE ABOVE 3 GROUNDS OF APPEAL EITHER AT OR BEFORE THE DATE OF HEARING. 2. FACTS NARRATED BY THE REVENUE AUTHORITIES ARE NOT DISPUTED BY BOTH THE PARTIES, HENCE, THE SAME ARE NOT REPEATED HERE FOR THE SAKE OF CONVENIENCE. 3. AFTER HEARING BOTH THE PARTIES, I AM OF THE VIE W THAT ASSESSEE IS CONTESTING THE ADDITION OF RS. 43,46,300/- BEING C ASH DEPOSITS AS UNEXPLAINED CASH CREDIT IN UNDISCLOSED BANK ACCOUN T. AFTER CONSIDERING THE SUBMISSIONS OF BOTH THE PARTIES, THE REVENUE AU THORITIES HAVE SUSTAINED THIS ADDITION AND NOW THE ASSESSEE IS IN APPEAL BEF ORE THE TRIBUNAL BY STATING THAT THE AO HAS MADE THE ADDITION OF RS. 43 ,46,300/- ON ACCOUNT OF UNEXPLAINED CASH CREDIT. HE FURTHER STATED THAT TH E AUTHORITIES BELOW HAVE NOT APPRECIATED THE SIMILAR FACTS AND CIRCUMSTANCES OF THE CASE OF ASSESSEE FOR THE ASSESSMENT YEAR 2009-10 AND SUBSEQUENT YEAR S I.E. 2011-12. IN THESE 02 ASSESSMENT YEARS SIMILAR CASH DEPOSITS MAD E BY THE ASSEESSEE, AND THE REVENUE HAS TREATED THE SAME AS BUSINESS RE CEIPTS AND BROUGHT TO TAX AFTER ALLOWING THE ESTIMATED EXPENSES. BUT IN THE PRESENT CASE, THE SAME HAS NOT BEEN DONE BY THE REVENUE AUTHORITIES. HOWEVER, THE REVENUE AUTHORITIES HAVE TREATED THESE CASH DEPOSI TS OF RS. 43,46,300/- AS UNEXPLAINED CASH CREDIT AND MADE/CONFIRMED THE ADDITION IN DISPUTE. I AM OF THE VIEW THAT ASSESSEE IS ENGAGED IN TRADIN G OF MEDICINES AND TRANSACTION OF BANK ACCOUNT IS FROM SALE AND PURCHA SE OF MEDICINES AND ASSESSEE HAS DISCLOSED THE GROSS PROFIT (GP)@3.63%, BUT THE SAME HAS NOT BEEN ACCEPTED BY THE REVENUE AUTHORITIES AND T HEY MADE/CONFIRMED THE ADDITION IN DISPUTE ON THE GROUND THAT ASSESSE E DID NOT DISCLOSE THE BANK ACCOUNT. 4. AFTER HEARING BOTH THE PARTIES AND PERUSING THE RELEVANT RECORDS AVAILABLE WITH ME AND KEEPING IN VIEW THE BUSINESS OF THE ASSESSEE AND THE FACTS AND CIRCUMSTANCES OF THE EARLIER YEARS, THE B ENCH PUT THE PROPOSAL 4 BEFORE THE LD. COUNSEL FOR THE ASSESSEE THAT HOW MU CH ASSESSEE CAN MAKE THE PAYMENT ON THE ADDITION OF RS. 43,46,300/- ON A CCOUNT OF CASH DEPOSIT. LD. COUNSEL FOR THE ASSESSEE AGREED TO MAKE THE PAY MENT @30% ON THE ADDITION OF RS. 43,46,300/- AND NO OBJECTION HAS B EEN RAISED BY THE LD. DR ON THIS PROPOSITION. 5. KEEPING IN VIEW OF THE FACTS AND CIRCUMSTANCES O F THE CASE AND THE ISSUE IN DISPUTE, I AM DIRECTING THE ASSESSING OFFI CER TO MAKE THE PAYMENT @30% ON THE ADDITION OF RS. 43,46,300/- AND ACCOR DINGLY COMPUTE THE INCOME OF THE ASSESSEE FOR THE ASSESSMENT YEAR 2010 -11, IN ACCORDANCE WITH LAW. 6. IN THE RESULT, THE APPEAL OF ASSESSEE IS ALLOWE D IN THE AFORESAID MANNER. THE DECISION IS PRONOUNCED ON 11-03-2020. SD/- (H.S. SIDHU) JUDICIAL MEMBER DATED: 11.03.2020 SRB COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR ASST. REGISTRAR, ITAT, NEW DELHI