ITO, New Delhi V. Shri Dharmender Kumar, New Delhi

ITA 776/DEL/2016

• Counselvise Citation: [2019] 116 COUNSELVISE.COM (IT) 3044 (ITAT-DELHI)
• Duration Of Justice: 3 year(s) 6 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-08-2019
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: G
• Assessment Year: 2010-2011
• Appeal Filed On: 12-02-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES G , NEW DELHI BEFORE SH. AMIT SHUKLA , JUDICIAL MEMBER DR. B. R. R. KUMAR , ACCOUNTANT MEMBER ITA NO. 776 /DEL/201 6 : ASSTT. YEAR : 2010 - 1 1 INCOME TAX OFFICER, WARD - 38(2), NEW DELHI VS DHARMENDER KUMAR, D - 16/381, SECTOR - 7, ROHINI, NEW DELHI - 110085 (APPELLANT) (RESPONDENT) PAN NO. A IVPK1870D ASSESSEE BY : SH. KAPIL GOEL, ADV. REVENUE BY : SH. N. K. BANSAL, SR. DR DATE OF HEAR ING: 20 . 08 .201 9 DATE OF PRONOUNCEMENT: 21 .08 .201 9 ORDER PER DR. B. R. R. KUMAR , A CCOUNTANT M EMBER : FOLLOWING GROUNDS HAVE BEEN RAISED BY THE ASSESSEE: (I) DELETING THE ADDITION OF RS.5,86,04,027/ - ON ACCOUNT OF UNDISCLOSED CASH DEPOSITED IN THE BANK ACCOUNT OF THE CONCERNS OWNED BY THE ASSESSEE. (II) COMPUTINGG THE INCOME BEING 0.37% ON RS.5,86,04,027/ - HAS COMMISSION INCOME. IT IS NOT ESTABLISHED THAT THE ASSESSEE IS CARRYING GENUINE BUSINESS ON WHICH SUCH COMMISSION IS EARNED. 2. THE CORE PERTAINS TO ASSESSING THE COMMISSION ON PROTECTIVE BASIS AS CONFIRMED BY THE LD.CIT(A).T HE ASSESSEE IS AN EMPLOYEE OF SH. R.N. AGGARWAL PROP. R.N. AGGARWAL & COMPANY, D - 16/381, SECTOR - 7, ROHINI, NEW DELHI. THE ONLY SOURCE OF INCOME OF THE ASSESSEE IS THE SALARY RECEIVED FROM HIS EMPLOYER. IN THE BANK ACCOUNT NO. 91311010000851 OF THE ASSESSEE THE REVENUE HAS FOUND CASH DEPOSITS OF RS.58,57,000/ - WHICH HAVE BEEN SUBSEQUEN TLY TRANSFERRED TO SH. R.N. AGGARWAL, THE EMPLOYER S BANK ACCOUNT NO. 91311010000398 BY WAY OF CHEQUE TRANSFERS. ITA NO . 776 /DEL /2016 DHARMENDER KUMAR 2 SIMILARLY, IN THE ACCOUNT NO. 91311010000866 OF THE ASSESSEE THE REVENUE HAS FOUND CASH DEPOSITS OF RS.237,98,310/ - WHICH HAVE BEEN TRANSFERRED TO SH. R.N. AGGARWAL, THE EMPLOYER S BANK ACCOUNT NO. 91311010000398 BY WAY OF CHEQUE TRANSFERS. IN ADDITION TO THE TRANSFERS OUT OF THE CASH DEPOSITS, THE ASSESSEE HA D DEPOSITS BY WAY OF CHEQUES OF RS.289,48,717/ - IN BOTH THE ACCOUNTS MAINTAINED BY HIM. THESE DEPOSITS BY WAY OF CHEQUES WERE ALSO FOUND TO HAVE BEEN TRANSFERRED TO THE ACCOUNT NO. 91311010000398 BELONGING TO SH. R.N. AGGARWAL. OWING TO THE STATEMENT OF SH. R.N. AGGARWAL THAT THE SE AMOUNTS BELONG TO HIM AND THE ASSESSEE DHARMENDER KUMAR IS ON LY A NAME LENDER WHO HAS OPENED THE ACCOUNT AT HIS BEHEST TO FACILITATE THE TRANSFER OF FUNDS, THE REVENUE MADE PROTECTIVE ASSESSMENT OF THESE AMOUNTS OF RS.587,82,037/ - (CASH DEPOSITS OF RS.296,55,310/ - + CHEQUE DEPOSIT OF RS.289,48,717/ - ) IN THE HANDS OF THE ASSESSEE. THE SUBSTANTIVE ASSESSMENT HAS BEEN MADE IN THE HANDS OF SH. R.N. AGGARWAL BY ITO, WARD - 38(2), NEW DELHI AND ASSESSED THAT THE RATE OF 0.25% TO 0.37% ON THE TOTAL DEPOSITS. 3. THE LD. CIT (A) HAS COMPUTED COMMISSION @ 0.37% ON THE TOTAL DEPOSITS (CASH AND CHEQUE) FOUND IN THE BANK ACCOUNTS OF THE ASSESSEE AT RS.214,434/ - AND HELD THIS AS INCOME TO BE ADDED ON PROTECTIVE BASIS . 4. AGGRIEVED WITH THE ORDER OF THE LD. CIT (A), THE REVENUE FILED APPEAL BEFORE US. DURING THE ARGUMENTS BE FORE US, THE LD. DR FILED THE ASSESSMENT ORDER IN THE CASE OF SH. R.N. AGGARWAL WHEREIN THE DEPOSITS IN THE CASE OF THE ASSESSEE HAVE BEEN TREATED ON SUBSTANTIVE BASIS AND CHARGED TO TAX ON THE COMMISSION EARNED. THE LD. DR FAIRLY CONCEDED THE FACT THAT THE ITA NO . 776 /DEL /2016 DHARMENDER KUMAR 3 ASSESSMENT IN THE CASE OF THE ASSESSEE HAS BEEN MADE ON PROTECTIVE BASIS. 5. SINCE, THE ASSESSMENT HAS BEEN MADE ON PROTECTIVE BASIS , THE ASSESSEE IS NOT LIABLE TO BE TAX ED EVEN ON ACCOUNT OF COMMISSION WHICH HAS ALREADY BEEN TAXED IN THE HANDS OF SH. R.N. AGGARWAL. HENCE, THE APPEAL OF THE REVENUE STANDS DISMISSED. 6. BEFORE PARTING, WE WOULD LIKE TO KEEP IT ON RECORD THAT, THE COURT HAS POSED A PERTINENT QUESTION TO THE REPRESENTATIVES AS TO WHETHER THE ENTIRE CASH DEPOSITS OR THE CHEQUE DEPOSITS HAVE BEEN SUBSTANTIVELY ASSESSED IN ABSOLUTE AMOUNT IN THE CASE OF ANY OTHER ASSESSEE OR NOT FOR WHICH THE REVENUE COULD NOT ANSWER. IF SO, IT WOULD BE LOSS TO THE EXCHEQUER AS ONLY THE COMMISSION HAS BEEN TAXED AND THE REMAINING AMO UNT HAS ESCAPED ASSESSMENT ALTOGETHER. 7 . IN THE RESULT, THE APPEAL OF THE REVENUE IS DISMISSED . (ORDER PRO N OUNC ED IN THE OPEN COURT ON 21 /0 8 /2019). SD/ - SD/ - ( AMIT SHUKLA ) ( DR. B. R. R. KUMAR ) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 2 1 /0 8 /2019 *SUBODH* COPY FORWARDED TO: 1 . APPELLANT 2 . RESPONDENT 3 . CIT 4 . CIT(APPEALS) 5 . DR: ITAT ASSISTANT REGISTRAR