Sh. Om Parkash, Gurgaon V. ITO, Gurgaon

ITA 81/DEL/2017

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 2849 (ITAT-DELHI)
• Duration Of Justice: 11 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-12-2017
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: SMC
• Next Hearing Date: 13-06-2017
• Assessment Year: 2011-2012
• Appeal Filed On: 05-01-2017
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Keywords: Peak credit
• Section: 131; 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES : SMC : NEW DELHI BEFORE SHRI R.S. SYAL, VICE PRESIDENT ITA NO.81/DEL/2017 ASSESSMENT YEAR : 2011-12 OM PARKASH, H.NO.738, WARD-21, GALI NO.2, OM NAGAR, GURGAON. . VS. ITO, WARD-11(1), GURGAON. ASSESSEE BY : SHRI K. SAMPATH & SHRI V. RAJA KUMAR, ADVOCATES DEPTT. BY : SHRI AMIT JAIN, SR. DR DATE OF HEARING : 21.12.2017 DATE OF PRONOUNCEMENT : 21.12.2017 ORDER THIS APPEAL BY THE ASSESSEE ARISES OUT OF THE ORDER PASSED BY THE CIT(A) ON 15.12.2016 IN RELATION TO THE ASSE SSMENT YEAR 2011-12. ITA NO.81/DEL/2017 2 2. THE ONLY ISSUE RAISED IN THIS APPEAL IS AGAIN ST THE CONFIRMATION OF ADDITION OF RS.47,21,100/- MADE BY THE ASSESSING OF FICER ON ACCOUNT OF CASH DEPOSITS IN BANK BY INVOKING THE PROVISIONS OF SECTION 68 OF THE INCOME-TAX ACT, 1961 (HEREINAFTER ALSO CALLED `THE ACT). 3. BRIEFLY STATED, THE FACTS OF THE CASE ARE THAT T HE ASSESSING OFFICER, ON PERUSAL OF THE BANK STATEMENT OF THE ASSESSEE, O BSERVED THAT CASH DEPOSITS OF RS.47,21,100/- WERE MADE ON VARIOUS DAT ES, WHICH HAVE BEEN TABULATED ON PAGE 2 OF THE ASSESSMENT ORDER. ON BE ING CALLED UPON TO GIVE THE SOURCE OF SUCH DEPOSITS WITH DOCUMENTARY E VIDENCE, THE ASSESSEE SUBMITTED THAT HE WAS AUTHORIZED BY SHRI RATTAN SINGH TO DEPOSIT A SUM EQUIVALENT TO THE LICENCE FEES AMOUNT OUT OF DAILY CASH SALES IN HIS BANK ACCOUNT AND PAY A LICENCE FEE FRO M THIS ACCOUNT. A COPY OF AGREEMENT IN SUPPORT OF SUCH A CONTENTION W AS ALSO PLACED BEFORE THE ASSESSING OFFICER. IT WAS CLAIMED THAT THE ASSESSEE WAS AWARDED A SUM OF RS.50,000/- FOR THIS WORK. THE AS SESSING OFFICER REQUIRED THE ASSESSEE TO PRODUCE SHRI RATTAN SINGH AND HIS BOOKS OF ACCOUNT TO SUBSTANTIATE THE CLAIM, WHICH THE ASSESS EE COULD NOT. ITA NO.81/DEL/2017 3 SUMMONS U/S 131 WAS ALSO ISSUED TO SHRI RATTAN SING H WHICH REMAINED UNCOMPLIED WITH. HOWEVER, A BANK CERTIFICATE WAS F ILED SHOWING THAT THE LICENCE FEE AMOUNTING TO RS.44.69 LAC WAS PAID FROM THE ASSESSEES BANK ACCOUNT. THE ASSESSING OFFICER FURTHER OBSERVE D THAT THERE WERE CASH DEPOSIT OF RS.6 LAC IN TWO INSTALMENTS OF OF RS.3 LAC EACH, WHICH WERE CLAIMED TO HAVE BEEN RECEIVED FROM ONE SHRI JA GRAM ON 08.02.2011 AND 21.02.2011 AGAINST THE AGREEMENT TO SELL, WHICH WAS LATER ON RETURNED BECAUSE NO AGREEMENT WAS ACTUALLY ENTERED INTO. IN THE BACKDROP OF THESE FACTS, THE ASSESSING OFFICER ADDE D RS.47,21,100/- AS THE ASSESSEES INCOME. THE LD. CIT(A) GAVE HIS IMP RIMATUR TO THE VIEW OF THE AO. THE ASSESSEES CONTENTION FOR CONSIDERI NG THE PEAK AMOUNT FOR THE PURPOSES OF THE ADDITION WAS ALSO TURNED DO WN. THE ASSESSEE IS AGGRIEVED AGAINST THIS ADDITION. 4. HAVING HEARD BOTH THE SIDES AND PERUSED THE RELE VANT MATERIAL ON RECORD, IT IS OBSERVED THAT IN SO FAR AS PAYMENT OF LICENCE FEES IS CONCERNED, THE BANK HAS CERTIFIED THAT LICENCE FEES WAS PAID BY THE ASSESSEE OUT OF HIS BANK ACCOUNT AND DY. EXCISE AND TAXATION ITA NO.81/DEL/2017 4 COMMISSIONER (EXCISE), GURGAON HAS CERTIFIED THAT T HE LIQUOR VEND WAS ALLOTTED TO SHRI RATTAN SINGH AND NOT SHRI OM PARKA SH, THE ASSESSEE. A COPY OF SUCH CERTIFICATE IS PLACED AT PAGE 22 OF TH E PAPER BOOK. THIS DECIPHERS THAT THE ASSESSEES CONTENTION ABOUT THE DEPOSIT OF EXCISE DUTY FOR AND ON BEHALF OF SHRI RATTAN SINGH CANNOT BE BR USHED ASIDE SO EASILY. HOWEVER, IT ALSO REMAINED AS A FACT THAT THE ASSESS EE COULD NOT PRODUCE THE BOOKS OF ACCOUNT OF SHRI RATTAN SINGH TO SHOW T HAT EQUAL AMOUNT OF CASH WAS GIVEN TO THE ASSESSEE WHICH WAS DEPOSITED IN HIS BANK ACCOUNT. THERE IS FURTHER SOME DISPUTE ABOUT THE SOURCE OF C ASH DEPOSIT IN THE BANK, BEING, TRANSACTION WITH SHRI JAGRAM AS THE AM OUNT WAS CLAIMED TO HAVE EXCHANGED HANDS IN 2011, WHEREAS AGREEMENT PLA CED ON RECORD IS DATED 2013. TAKING INTO CONSIDERATION THE ENTIRETY OF THE FACTS AND CIRCUMSTANCES AS OBTAINING IN THIS CASE, I AM OF TH E CONSIDERED OPINION THAT IT WILL BE JUST AND FAIR IF PEAK CREDIT IS ADD ED TO THE ASSESSEES INCOME INSTEAD OF ALL THE INDIVIDUAL AMOUNTS OF DEP OSITS. SUCH COMPUTATION OF PEAK AMOUNT HAS BEEN PLACED AT PAGE 4 OF THE PAPER BOOK AND GOING BY THE SAME, IT COMES TO RS.4,39,620/- AS ON 25.02.2011. THE ADDITION IS ERGO RESTRICTED TO THIS LEVEL AND THE A SSESSEE GETS PART RELIEF. ITA NO.81/DEL/2017 5 5. IN THE RESULT, THE APPEAL FILED BY THE ASS ESSEE IS PARTLY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 21.12.2017. SD/- [R.S. SYAL] VICE PRESIDENT DATED, 21 ST DECEMBER, 2017. DK COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT (A) 5. DR, ITAT AR, ITAT, NEW DELHI.