Sh. Darshan Singh, Kurukshetra V. ITO, Kurukshetra

ITA 792/CHANDI/2017

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 6652 (ITAT-CHANDIGARH)
• Duration Of Justice: 5 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-10-2017
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: Not Allotted
• Assessment Year: 2011-2012
• Appeal Filed On: 09-05-2017
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Assessee Lawyers: ROHIT GOEL SMT CHANDRAKANTA
• Keywords: Unexplained investment
• Section: 44AD; 69

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DIVISION BENCHA, CHANDIGARH BEFORE SHRI. SANJAY GARG, JUDICIAL MEMBER AND DR. B.R.R. KUMAR, ACCOUNTANT MEMBER ITA NO.792/CHD/2017 ASSESSMENT YEARS: 2011-12 SH. DARSHAN SINGH VS. THE ITO BYPASS ROAD WARD-1 KURUKSHETRA KURUKSHETRA PAN NO. ATCPS7400F (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI. ROHIT GOEL DEPARTMENT BY : SMT. CHANDRAKANTA DATE OF HEARING : 01/08/2017 DATE OF PRONOUNCEMENT : 27/10/2017 ORDER PER DR. B.R.R. KUMAR, A.M: THE PRESENT APPEAL HAS BEEN FILED BY THE ASSESSEE A GAINST THE ORDER OF THE LD. CIT(A)-, KARNAL DT. 23/02/2017. 2. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL: 1. THE LD. CIT(A) HAS ERRED IN LAW AND FACTS IN CON FIRMING AN ADDITION OF RS. 12,75,576/- OUT OF RS. 53,72,040/- CASH DEPOSITED I N BANK AND ADDITIONS MADE BY AO IN ASSESSMENT. 2. THAT LD. CIT(A) HAS ERRED IN LAW AND FACTS IN CO NFIRMING AN ADDITIONS OF RS. 12,75,576/- DESPITE THERE IS NO NEGATIVE CASH ON AN Y DATE. 3. THAT LD. CIT(A) HAS ERRED IN LAW AND FACTS IN ES TIMATING RS. 8,05,806/- 15% OF CASH DEPOSIT / TOTAL TURNOVER OF RS. 53,72,040/- AS UNEXPLAINED INVESTMENT AND 10% AS PROFIT ON RS. 46,97,700/- BEING UNEXPLAINED TURNOVER RESULTING INTO AN ADDITION OF RS. 12,75,576/-. 4. THAT THE LD. CIT(A) HAS ERRED IN LAW AND FACTS I N HOLDING RS. 53,72,040/- AS TOTAL TURNOVER AND RS. 46,97,700/- AS UNEXPLAINED TURNOVE R OF ASSESSEE OUT OF CASH DEPOSIT OF RS. 53,72,040/-. 3. THE RETURN OF INCOME WAS FILED DECLARING TOTAL I NCOME OF RS. 1,77,800/- AND AGRICULTURE INCOME OF RS. 7,15,000/-. THE ASSESSING OFFICER MADE ADDITION UNDER SECTION 69 OF THE INCOME TAX ACT 1961 OF RS. 53,72,040/- FO UND DEPOSITED IN THE BANK ACCOUNT OF AXIS BANK, KURUKSHETRA. 4. AGGRIEVED THE ASSESSEE FILED APPEAL BEFORE THE L D. CIT(A). 2 5. THE LD. CIT(A) HAS RESTRICTED THE ADDITION TO RS . 12,75,576/-. THE LD. CIT(A) HELD THAT THE TOTAL DEPOSITS OF RS. 53,72,040/- WERE TAK EN TO BE THE TOTAL TURNOVER OF THE ASSESSEE AND CALCULATED UNEXPLAINED INVESTMENT @ 15 % WHICH COMES TO RS. 805806/- AND ALSO CONFIRM THE ADDITION OF RS. 469770/- BEING 10% OF THE PROFIT ON THE AMOUNT OF 46,97,700/-(5372040-805806). 6. BEFORE US THE LD. DR SUPPORTED THE ORDER OF LD. CIT(A). 7. THE AR ARGUED THAT THESE CASH DEPOSITS WERE OUT OF THE CASH WITHDRAWALS FROM THE SAME BANK ACCOUNT. THE LD. AR HAS SUBMITTED THE CASH FLOW STATEMENT FROM 01/04/2010 TO 31/03/2011. THE LD. AR ARGUED THAT TH E ASSESSEE HAS DECLARED PROFIT OF RS. 1,62,700/- ON RETAIL SALE OF BUILDING MATERIAL AND FILED RETURN UNDER SECTION 44AD BY APPLYING 8% PROFIT RATE. HE FURTHER HE FURTHER ARGU ED THAT THE ASSESSEE HAD DEPOSITED RS. 9,47,135/- ON ACCOUNT OF AGRICULTURE INCOME AND RS. 7,09,000/- ON ACCOUNT OF SALE OF LAND ON 09/09/2010. 8. WE HAVE HEARD LD. REPRESENTATIVES OF BOTH THE PA RTIES AND PERUSED THE MATERIAL PLACED BEFORE US. 9. DURING THE YEAR THE ASSESSEE HAS DECLARED RS. 7, 15,000/- AS AGRICULTURE INCOME IN THE RETURN OF INCOME AND ALSO DECLARED AGRICULTURE INCOME IN THE EARLIER YEARS. FURTHER, THE ASSESSEE SOLD AGRICULTURE LAND ON 09/09/2010 FO R RS. 7,09,000/- WHICH WAS IN THE NAME OF SUKHVINDER KAUR (ACCOUNT HOLDER, W/O ASSESS EE) THE COPY OF THE SALE DEED WAS FILED. THE ASSESSEE HAS SUBMITTED THE BANK STAT EMENT IN THE NARRATION EXPLAINING THE NATURE OF THE DEPOSITS. 10. THUS, AFTER DEDUCTION OF THE AGRICULTURAL INCOM E AND THE PROCEEDS OF SALE OF LAND THE CASH DEPOSITS REMAINED AT RS. 39,48,040/- ( 53, 72,040-(7,15,000 + 7,09,000). THE PROFIT @ 8% ON 39,48,040/- DETERMINED AT RS. 3,15,843/-. THE ASSESSEE HAS ALREADY DECLARED RS. 1,62,700/- IN THE RETURN INCOME. HENCE, AN AMOU NT OF RS. 1,53,143/- IS DETERMINED AS PROFIT FROM THE BUSINESS AND IS HEREBY CONFIRMED. 11. IN THE RESULT APPEAL OF THE ASSESSEE IS PARTLY ALLOWED. THE ORDER IS PRONOUNCED ON 27/10/2017 IN THE OPEN COURT . SD/- SD/- (SANJAY GARG) (DR. B.R.R. KUM AR) JUDICIAL MEMBER ACCOUNTANT MEMBER 27/10/2017 AG COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT 4. THE CIT(A) 5. THE DEPARTMENTAL REPRESENTATIVE