Raj Kumar Sachdeva, Gurugram V. DCIT, Circle-3, Gurugram

ITA 88/DEL/2019

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 6546 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-02-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2010-2011
• Appeal Filed On: 07-01-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Section: 148

Judgement Text

PAGE 1 OF 5 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH SMC, NEW DELHI BEFORE MRS. DIVA SINGH, JUDICIAL MEMBER ITA NO.88/DEL/2019 ASSESSMENT YEAR: 2010-11 SH. RAJ KUMAR SACHDEVA, M 2079, M BLOCK SECTOR 56, DAVENDAR VIHAR, GURUGRAM. VS. DCIT, CIRCLE-3, GURGAON PAN : AUJPS 9782N (APPELLANT) (RESPONDENT) O R D E R THE PRESENT APPEAL HAS BEEN FILED BY THE ASSESSEE W HEREIN THE CORRECTNESS OF THE ORDER DATED 08.10.2018 OF CIT(A)-1, GURGAON PER TAINING TO 2010-11 ASSESSMENT YEAR IS ASSAILED ON THE GROUNDS THAT ADDITION OF RS .4,20,000/- MADE BY THE ASSESSING OFFICER HAS BEEN WRONGLY SUSTAINED IN APPEAL. 2. THE GROUNDS RAISED BY THE ASSESSEE APPEAL TO BE ARGUMENTATIVE AND CONSIDERING THESE TO BE ARGUMENTS ARE TAKEN INTO CO NSIDERATION FOR THE PASSING OF THE ORDER. THE RELEVANT FACTS OF THE CASE ARE THAT NO R ETURN FOR THE YEAR UNDER CONSIDERATION HAD BEEN FILED BY THE ASSESSEE. IT IS ONLY IN RESPONSE TO NOTICE U/S 148 THAT A RETURN WAS FILED BY THE ASSESSEE. 3. THE AO REQUIRED THE ASSESSEE IN TERMS OF THE RE ASONS RECORDED TO EXPLAIN THE DEMAND DRAFT AMOUNTING TO RS.4,20,000/- FOR WHICH P AYMENT HAS BEEN MADE IN CASH. THE ASSESSEES EXPLANATION WAS NOT ACCEPTED LEADING HIM TO MAKE THE ADDITION OF APPELLANT BY NONE RESPONDENT BY SH. PRADEEP SINGH GAUTAM, SR. D.R. DATE OF HEARING 03.02.2020 DATE OF PRONOUNCEMENT 06.02.2020 02.L05005 20 ITA NO.88/DEL/2019 RAJ KUMAR SACHDEVA VS. DCIT PAGE 2 OF 5 THE SAID AMOUNT. THE ISSUES WAS CHALLENGED IN APPEA L BEFORE THE CIT(A) WHEREIN THE FOLLOWING ARGUMENTS WERE ADVANCED, THESE ARE EXTRAC TED AT PARA 3.2 OF PAGE-2 OF THE IMPUGNED ORDER AND ARE REPRODUCED FOR READY REFEREN CE. 3.2 A.R OF THE APPELLANT FILED WRITTEN SUBMISSION DATED 05.10.2018, RECEIVED IN THIS OFFICE ON 08.10.2018. RELEVANT PART OF SUBMISSION READS AS UNDER:- THE APPELLANT, SH. RAJ KUMAR SACHCLEVA VIDE PAN AU JPS9782N WAS A SALARIED EMPLOYEE IN THE COMPANY WOODS PUBLICITY PVT. LTD. I N THE A.Y 2010-11. HIS CASE WAS SELECTED FOR SCRUTINY BY THE LD. DY. COMMISSIONER O F INCOME TAX SH. VIRENDRA KUMAR SINGH AND THE ASSESSMENT HAS BEEN COMPLETED U/S 143 (3)/147 OF THE IT ACT, 1961 ON 26/12/2017 AT ASSESSED INCOME OF RS.9,09.290/- AGAI NST THE RETURNED INCOME OF RS.4,89,292/- (COPY OF ITR ALONG WITH COMPUTATION O F INCOME FOR THE SAID AY IS ATTACHED HEREWITH AS ANNUEXURE 'A '). WHILE DOING SO ASSESSING OFFICER HAS MADE ADDI TION OF RS. 4,20,000/- AS UNEXPLAINED CASH DEPOSIT. DURING THE PERIOD UNDER CONSIDERATION APPELLANT HAD MADE A DEMAND DRAFT AMOUNTING TO RS.4,20,000 IN CASH. THE APPELLANT WAS ASKED TO FUR NISH THE DETAILS OF SOURCE OF CASH AMOUNTING TO RS. 4,00,000/- USED TO MAKE THE DRAFT, IN THIS REGARD WE WOULD LIKE TO FURNISH THAT THE ASSESSEE OPENED AN ACCOUNT FOR TRADING IN COMMODITIES (MCX) ACCOUNT AND INCURRED HEAVY LOSSES. THE ACCOUNT WAS OPENED WITH A FRANCHISE OF UNICORN SECURITIES LTD. THE ENTIRE AMOUNT INVESTED HAS BEEN LOST. THE ASSESSEE COULD HAVE CLAIMED THAT AS CARRIED FORWARD BUSINESS LOSS BUT IN THE ABSENCE OF STATEMENTS (AS THE FRANCHISE HAS CLOSED BUSINESS AND PHONE NUMBER IS NOT WORKING AS WELL) NOTHING COULD BE CLAIMED IN THE ITR. APPELLANT IS HAVING HIS SOURCE OF INCOME BY WAY OF SALARY. SALARY OF APPELLANT WAS DULY CREDITED IN THE BANK STATEMENT. CASH DEPOSITED IN T HE BANK OUT OF CASH WITHDRAWALS DURING THE YEAR AND IS OUT OF THE TAX PAID INCOME OF THE P AST YEARS. OUT OF THE TOTAL CASH DEPOSITED AN AMOUNT OF RS.4,20,000/- WAS UTILIZED TOWARDS MAK ING DEMAND DRAFT FOR UNICORN SECURITIES LTD. (COMMODITIES AMOUNT WITH MCX, AS ME NTIONED ABOVE). HENCE, TOTAL CASH DEPOSITED WAS FROM THE ABOVE MENTIONED SOURCES. COP Y OF BANK STATEMENTS VERIFYING THE SAID FACTS IS ATTACHED HEREWITH AS ANNEXURE B FOR YOUR VERIFICATION AND RECORD. 3.1 CONSIDERING THE EXPLANATION OF THE ASSESSEE THE ADDITION WAS SUSTAINED BY THE LD. CIT(A) HOLDING AS UNDER: 3.3 I HAVE CAREFULLY CONSIDERED THE APPELLANTS SU BMISSION. THE APPELLANT HAS CONTENDED THAT THE CASH AMOUNTING TO RS.4,20,000/- WAS FROM CASH WITHDRAWALS MADE FROM THE SAME BANK ACCOUNT. I HAVE PERUSED THE COPY OF B ANK ACCOUNT STATEMENT FILED BY THE APPELLANT. IT IS EVIDENT FROM THE COPY OF BANK ACCO UNT THAT THE CASH WITHDRAWALS ARE HARDLY SUFFICIENT TO EXPLAIN EVEN THE CASH DEPOSITS AND HO USEHOLD EXPENDITURE. THERE IS NO POSSIBILITY OF ANY CASH BEING AVAILABLE WITH THE AP PELLANT OUT OF CASH WITHDRAWALS FOR MAKING A DRAFT OF RS.4,20,000/-. THE ADDITION MADE BY THE A.O IS ACCORDINGLY CONFIRMED. THE GROUND OF APPEAL IS DISMISSED. ITA NO.88/DEL/2019 RAJ KUMAR SACHDEVA VS. DCIT PAGE 3 OF 5 4. THE LD. SR. DR HEAVILY RELIED UPON THE IMPUGNED ORDER. 5. AT THE TIME OF HEARING, NO ONE WAS PRESENT ON BE HALF OF THE ASSESSEE, HOWEVER ON A CONSIDERATION OF THE MATERIAL AVAILABLE ON REC ORD IT WAS DEEMED APPROPRIATE TO PROCEED WITH THE APPEAL EX-PARTE QUA ASSESSEE APPEL LANT AFTER HEARING THE LD. SR. DR. ON A PERUSAL OF THE EXPLANATION OFFERED IT IS SEEN THAT THE ASSESSEE APPEARS TO HAVE EXPLAINED THE NECESSITY FOR MAKING THE DEMAND DRAFT. IT IS SEEN THAT THE ASSESSEE IS A SALARIED EMPLOYEE IN THE COMPANY OF W OODS PUBLICITY PVT. LTD. THE ASSESSEE IS REQUIRED TO SHOW THAT FROM HIS KNOWN SO URCES OF INCOME THE FUNDS WERE AVAILABLE. IT IS SEEN THAT THERE IS NO DISCUSSION I N THE ORDER AS TO HOW THE STATED MONEY WAS AVAILABLE TO HIM FROM HIS SALARY ETC. IT IS SEEN THAT THE WITHDRAWALS FROM THE BANK ACCOUNT ARE HELD TO BE NOT SUFFICIENT. ACC ORDINGLY, IN THE INTEREST OF SUBSTANTIAL JUSTICE, THE IMPUGNED ORDER IS SET ASID E BACK TO THE FILE OF THE LD. CIT(A). THE ASSESSEE IN ITS OWN INTEREST IS DIRECTED TO PLA CE ALL SUPPORTING FACTS AND EVIDENCES TO JUSTIFY THE AVAILABILITY OF THE STATED AMOUNT OF RS.4,20,000/- WITH HIM. IT IS MADE CLEAR THAT IN THE EVENTUALITY OF ABUSE O F THE TRUST THE LD. CIT(A) WOULD BE AT LIBERTY TO PASS AN ORDER ON THE BASIS OF MATERIA L AVAILABLE ON RECORD. THE ASSESSEE TO PLACE RELEVANT FACTS AND POST EARNING AND AVAILA BLE FUNDS IN GOOD FAITH BEFORE THE LD. CIT(A). SAID ORDER WAS PRONOUNCED IN THE OPEN C OURT AT THE TIME OF HEARING ITSELF. 6. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED FOR STATISTICAL PURPOSES. THE ORDER IS PRONOUNCED IN THE OPEN COURT AT THE TI ME OF HEARING ITSELF ON 06 TH FEBRUARY, 2020. SD/- (DIVA SINGH) JUDICIAL MEMBER PK/PS COPY FORWARDED TO: 1. APPELLANT ITA NO.88/DEL/2019 RAJ KUMAR SACHDEVA VS. DCIT PAGE 4 OF 5 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTR AR, ITAT NEW DELHI