Himangshu Das, Kolkata V. I.T.O Wd - 51(1),kolkata, Kolkata

ITA 899/KOL/2013

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 4970 (ITAT-KOLKATA)
• Duration Of Justice: 3 year(s) 6 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-04-2016
• Appeal Filed By: Assessee
• Bench Allotted: C
• Next Hearing Date: 25-04-2016
• Assessment Year: 2008-2009
• Appeal Filed On: 23-04-2013
• Court: TRIBUNAL
• Department Lawyers: DEBASISH ROY
• Assessee Lawyers: P K HIMMATSINGHKA
• Keywords: Opportunity of being heard; Peak credit; Additional evidence
• Section: 143(3)

Judgement Text

I.T.A. NO. 899/KOL./2013 ASSESSMENT YEAR: 2008-2009 PAGE 1 OF 7 IN THE INCOME TAX APPELLATE TRIBUNAL, KOLKATA C BENCH, KOLKATA BEFORE SHRI P.M. JAGTAP, ACCOUNTANT MEMBER AND SHRI S.S. VISWANETHRA RAVI, JUDICIAL MEMBER I.T.A. NO. 899/KOL/ 2013 ASSESSMENT YEAR: 2008-2009 HIMANGSHU DAS,..................................... .................................APPELLANT C/O. P.K. HIMMATSINGHKA, AA-4, SALT LAKE, KOLKATA-700 064 [PAN : ADOPD 0854 E] -VS.- INCOME TAX OFFICER,................................ ..............................RESPONDENT WARD-51(1), KOLKATA, UTTARAPAN BUILDING, MANIKTALA CIVIC CENTRE, ULTADANGA, KOLKATA-700 054 APPEARANCES BY: SHRI P.K. HIMMATSINGHKA, A.R., FOR THE ASSESSEE SHRI DEBASISH ROY, JCIT, FOR THE DEPARTMENT DATE OF CONCLUDING THE HEARING : APRIL 25, 2016 DATE OF PRONOUNCING THE ORDER : APRIL 29, 2016 O R D E R PER SHRI P.M. JAGTAP :- THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAIN ST THE ORDER OF LD. COMMISSIONER OF INCOME TAX (APPEALS)-XXXII, KOLKATA DATED 12.03.2013 AND THE SOLITARY ISSUE INVOLVED THEREIN RELATES TO THE ADDITION MADE BY THE ASSESSING OFFICER ON ACCOUNT OF CREDITS APPEARI NG IN THE UNDISCLOSED BANK ACCOUNTS OF THE ASSESSEE AS SUSTAINED BY THE L D. CIT(APPEALS) TO THE EXTENT OF RS.35,89,725/-. 2. THE ASSESSEE IN THE PRESENT CASE IS AN INDIVIDUA L, WHO IS ENGAGED IN THE BUSINESS OF MANUFACTURING AND DEALING OF READYM ADE GARMENTS UNDER THE NAME AND STYLE OF HIS PROPRIETARY CONCERN M/S. IMPEX INDIA. THE I.T.A. NO. 899/KOL./2013 ASSESSMENT YEAR: 2008-2009 PAGE 2 OF 7 RETURN OF INCOME FOR THE YEAR UNDER CONSIDERATION W AS FILED BY HIM ON 30.09.2008 DECLARING TOTAL INCOME OF RS.1,53,977/-. AS PER THE INFORMATION RECEIVED BY THE ASSESSING OFFICER, THE ASSESESE DURING THE YEAR UNDER CONSIDERATION HAD PAID RS.11,16,000/- AG AINST CREDIT CARD BILLS THROUGH ABN AMRO BANK AND HAD ALSO ENTERED IN TO THE SHARE TRANSACTIONS OF RS.15,04,894/-. DURING THE COURSE O F ASSESSMENT PROCEEDINGS, THE ASSESSEE WAS CALLED UPON BY THE AS SESSING OFFICER TO EXPLAIN THE SOURCE OF PAYMENTS MADE ON ACCOUNT OF C REDIT CARD BILLS AND ALSO THE INVESTMENT MADE IN SHARES. THE ASSESSEE, H OWEVER, COULD NOT OFFER ANY SATISFACTORY EXPLANATION IN THIS REGARD. THE INFORMATION RECEIVED BY THE ASSESSING OFFICER FROM THE ABN AMRO BANK REVEALED THAT THE ASSESSEE DURING THE YEAR UNDER CONSIDERATION WA S MAINTAINING THREE BANK ACCOUNTS, TWO SAVINGS BANK ACCOUNTS AND ONE LO AN ACCOUNT, WITH THE SAID BANK. IT WAS ALSO REVEALED THAT THE ASSESS EE DURING THE YEAR UNDER CONSIDERATION HAD DEPOSITED BY WAY OF CASH AN D CHEQUES AMOUNTS OF RS.33,98,569/- AND RS.7,34,977/- IN HIS TWO SAVI NGS BANK ACCOUNTS, WHILE THE LOAN ACCOUNT TAKEN FROM THE BANK WAS REPA ID BY THE ASSESSEE TO THE EXTENT OF RS.1,12,543/-. SINCE THE ASSESSEE COULD NOT OFFER ANY EXPLANATION AS REGARDS THESE DEPOSITS FOUND TO BE M ADE IN HIS SAVINGS BANK ACCOUNTS AS WELL AS THE REPAYMENT OF LOAN, THE ENTIRE AMOUNT OF DEPOSITS MADE IN THE SAVINGS BANK ACCOUNTS AS WELL AS THE REPAYMENT OF LOAN AGGREGATING TO RS.42,46,089/- WAS ADDED BY THE ASSESSING OFFICER TO THE TOTAL INCOME OF THE ASSESSEE IN THE ASSESSMENT COMPLETED UNDER SECTION 143(3) VIDE AN ORDER DATED 21.12.2010. 3. AGAINST THE ORDER PASSED BY THE ASSESSING OFFICE R UNDER SECTION 143(3), AN APPEAL WAS PREFERRED BY THE ASSESSEE BEF ORE THE LD. CIT(APPEALS) AND AFTER CONSIDERING THE SUBMISSIONS MADE BY THE ASSESSEE AS WELL AS THE MATERIAL AVAILABLE ON RECORD, THE LD . CIT(APPEALS) DECIDED THE ISSUE BY RECORDING THE FOLLOWING OBSERVATIONS/F INDINGS IN HIS IMPUGNED ORDER:- I.T.A. NO. 899/KOL./2013 ASSESSMENT YEAR: 2008-2009 PAGE 3 OF 7 I HAVE CAREFULLY CONSIDERED THE SUBMISSION OF THE APPELLANT, ASSESSMENT ORDER OF THE ASSESSING OFFICE R, ADDITIONAL EVIDENCES FILED BY THE APPELLANT, REMAND REPORT OF THE ASSESSING OFFICER AND ITS REJOINDER OF THE APPELLANT. I FOUND THAT THIS IS A FACT THAT THE APPELLANT HAD NOT SHOWN SAVING ACCOUN TS NO.927278 AND 1362617. THE ARGUMENT OF THE APPELLAN T IS THAT HE MADE THE DEPOSIT IN THE SAVING ACCOUNTS OUT OF S ALES OF READY MADE GARMENTS. THE APPELLANT FAILED TO GIVE ANY SIN GLE PURCHASE BILL AND SALES BILLS TO WHOM HE MADE THE ' TRANSACTION. THE APPELLANT ALSO DID NOT DISCLOSED THESE TWO BANK ACCOUNTS AT THE TIME OF NOTICE U/S.142(1) OF THE LT . ACT DURING THE COURSE OF ASSESSMENT PROCEEDINGS. THE A/R ARGUE D THAT THERE WAS NO COLUMN IN THE RETURN TO SHOW THE BANK ACCOUNT IS NOT TENABLE BECAUSE THIS IS THE DUTY OF THE APPELLA NT TO SHOW THE TRUE PICTURE OF HIS PERSONAL ASSETS AND LIABILI TIES. THE APPELLANT HAD NOT SHOWN HIS REAL PICTURE BEFORE THE DEPARTMENT. THE APPELLANT DID NOT FILED ANY EVIDENC E WHICH ESTABLISHED THAT HE IS HAVING RS. 10,03,276/- OPENI NG CASH BALANCE AS ON 01.04.2007. FIRSTLY, I DEAL THE SB ACCOUNT NO.927278 WHEREIN TO TAL DEPOSIT MADE OF RS.33,98,569/-. THE FIRST ARGUMENT OF THE APPELLANT IS THAT ALL THE DEPOSIT MADE IN THIS UNDI SCLOSED BANK ACCOUNT IS OUT OF SALES RECEIPT OF THE APPELLANT WH ICH IS TOTALLY INCORRECT BECAUSE THE APPELLANT DID POT FILED ANY E VIDENCE WHICH ESTABLISHED THAT HE MADE THE PURCHASES AND SA LES OF THESE ITEMS. HE DID NOT PROVIDE ANY SINGLE PURCHASE S BILLS AND SALES BILLS ALSO. HE ALSO FAILED TO FILE ANY SINGLE EVIDENCE REGARDING THIS. ON GOING THROUGH THE COPY OF CASH B OOK FILED DURING THE COURSE OF APPELLATE PROCEEDING, IT IS NO TICED THAT HE DID MENTIONED ON ANY DATE TO DEPOSIT THE CASH IN TH E SAID BANK ACCOUNT. SO THE CONTENTION OF THE APPELLANT IS THAT HE DEPOSITED CASH IN THIS ACCOUNT FROM SALES IS NOT CORRECT. THE ALTERNATIVE PLEA OF THE APPELLANT IS THAT THE AR TAKEN THE ALTE RNATIVE ARGUMENT THAT THE PEAK THEORY MAY BE APPLIED IN HIS CASE. IN THE ACCOUNT NO.927278 THE PEAK WAS RS.6,56,945/- ON 05/05/2007. THE APPELLANT DID NOT FILED ANY DETAIL OF DEPOSIT OF CHEQUE ALSO. THE A.O. GAVE THE FINDING IN THE ASSES SMENT ORDER THAT THE APPELLANT HAD MADE PAYMENT OF RS.1,16,000/ - AGAINST CREDIT CARD BILLS AND HE ENTERED INTO SHARE TRANSAC TION OF RS.15,04,894/- DURING THE F.Y. 2007-08. THE AIR VID E HIS LETTER DATED 16/12/2010 CLEARLY STATED THE SOURCE OF INVES TMENT IN THE SHARES OF RS. 15,04,894/- AND REPAYMENT OF CRED IT CARD BILLS OF RS.11,16,000- WAS MADE FROM THE WITHDRAWAL OF SA VING BANK A/C NO.92727 & 1362617 WITH ABN AMRO BANK ( PRESENT LY RENAMED AS RBS BANK). THE APPELLANT HAS ALSO MADE T HE WITHDRAWAL FOR HOUSEHOLD EXPENSES AND OTHER MATTER ALSO HE ISSUED CHEQUE. HE MADE REPAYMENT OF CREDIT CARD BIL L OF RS.11,16,000/- AND SHARE INVESTMENT OF RS.15,04,894 /- AND CHEQUE ISSUED TO THIRD PARTIES CANNOT BE RULED OUT. HENCE, THE QUESTION OF THE PEAK CREDIT CANNOT ARISE IN THIS AC COUNT. SO THE I.T.A. NO. 899/KOL./2013 ASSESSMENT YEAR: 2008-2009 PAGE 4 OF 7 CONTENTION OF THIS APPELLANT IS NOT ACCEPTABLE BECA USE THE MONEY WAS NOT ROTATED THROUGH. THE APPELLANT FAILED TO ESTABLISH THE MONEY TO ROTATED THROUGH. I DEALT ANOTHER UNDISCLOSED BANK ACCOUNT NO. 136261 7. I, THOROUGHLY ANALYSIS THIS ACCOUNT. IN THIS ACCOUNT T HE TOTAL DEPOSIT RS.7,34,977.52 WHICH INCLUDES RS.5,43,821/- WHICH THE A/R EXPLAINED THAT THIS DEPOSIT OF THE LOANS AMOUNT OF RS.5,50,000/- GRANTED BY THE ABN AMRO BANK AFTER DE DUCTING THE PROCESSING CHARGES. THERE ARE TWO ENTRY OF INTE REST OF RS.157/- AND BALANCE ARE THE CASH DEPOSITED ON VARI OUS DATES. THE APPELLANT DID NOT WITHDRAW SINGLE PAISA IN CASH FROM THIS ACCOUNT. SO THE QUESTION OF THE PEAK DOES NOT ARISE . THE MONEY IS NOT ROUTED THROUGH IN THIS ACCOUNT. SO HOW DID T HE APPELLANT CLAIMED THE CREDIT FOR PEAK. THE APPELLANT EXPLAINE D THAT THE SOURCE OF DEPOSIT OF RS.5,43,821/- IS FROM THE LOAN ACCOUNT OF THE APPELLANT. I TREATED RS.5,43,821/- AS EXPLAINED AND RS.1,91,156/- IS TREATED AS UNEXPLAINED. CONSIDERING THE ABOVE FINDINGS AND FACTS OF THE CAS E I AM OF THE VIEW THAT THE TOTAL DEPOSITS OF RS.33,98,569 /- IN THE ACCOUNT NO.9272278 TREATED AS UNEXPLAINED AND IN AN OTHER ACCOUNT NO.1362617 THE DEPOSIT OF RS.5,43,821/- IS TREATED AS EXPLAINED AND BALANCE RS.L,91,156/- TREATED AS UNEX PLAINED. THEREFORE, THE ADDITION OF RS.(33,98,569 + 1,91,156 ) = RS.35,89,725/- IS CONFIRMED AND RS.5,43,821/- IS DE LETED. THIS GROUND IS PARTLY ALLOWED. THE LD. CIT(APPEALS) THUS SUSTAINED THE ADDITION OF RS.42,46,089/- MADE BY THE ASSESSING OFFICER ON ACCOUNT OF UNEXPLAINED DEPOSITS FOUND IN THE SAVINGS BANK ACCOUNT OF THE ASSESSEE AS WELL AS REP AYMENT OF LOAN TO THE EXTENT OF RS.35,89,725/-. STILL AGGRIEVED BY THE OR DER OF THE LD. CIT(APPEALS), THE ASSESEE HAS PREFERRED THIS APPAL BEFORE THE TRIBUNAL. 4. WE HAVE HEARD THE ARGUMENTS OF BOTH THE SIDES AN D ALSO PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. THE LD. COUN SEL FOR THE ASSESSEE, AT THE OUTSET, HAS REITERATED BEFORE US THE SUBMISSION S MADE BEFORE THE LD. CIT(APPEALS) THAT ALL THE DEPOSITS FOUND TO BE MADE IN THE TWO SAVINGS BANK ACCOUNTS OF THE ASSESSEE WERE RELATING TO HIS REGULAR BUSINESS OF MANUFACTURING AND DEALING OF READYMADE GARMENTS AND THE ADDITION, IF ANY, ON ACCOUNT OF TRANSACTIONS REFLECTED IN THE SA ID ACCOUNTS SHOULD BE MADE BY APPLYING THE NORMAL GROSS PROFIT RATE TO TH E DEPOSITS FOUND TO BE I.T.A. NO. 899/KOL./2013 ASSESSMENT YEAR: 2008-2009 PAGE 5 OF 7 MADE IN THE SAID BANK ACCOUNTS. WE ARE UNABLE TO AC CEPT THIS CONTENTION OF THE LD. COUNSEL FOR THE ASSESSEE. IT IS OBSERVED THAT REGULAR BOOKS OF ACCOUNT WERE MAINTAINED BY THE ASSESSEE IN RESPECT OF HIS BUSINESS OF MANUFACTURING AND DEALING OF READYMADE GARMENTS AND NEITHER THE SAVINGS BANK ACCOUNTS MAINTAINED WITH ABN AMRO BANK NOR EVEN THE TRANSACTIONS REFLECTED THEREIN WERE FOUND RECORDED IN THE BOOKS OF ACCOUNT OF THE ASSESSEE REGULARLY MAINTAINED. MOREO VER, AS RIGHTLY OBSERVED BY THE LD. CIT(APPEALS) IN HIS IMPUGNED OR DER, THE TRANSACTIONS REFLECTED IN THE SAVINGS BANK ACCOUNTS OF THE ASSES SEE WITH ABN AMRO BANK WERE NOT SUPPORTED BY ANY PURCHASE OR SALE BIL LS RELATING TO THE BUSINESS OF THE ASSESSEE SO AS TO SAY THAT THIS REP RESENTED REGULAR BUSINESS TRANSACTION OF THE ASSESESE. 5. AT THE TIME OF HEARING BEFORE US, THE LD. COUNSE L FOR THE ASSESSEE HAS FILED THE LEDGER ACCOUNT EXTRACT OF THE ASSESSEE IN THE BOOKS OF ACCOUNT OF HIS PROPRIETARY CONCERN TO SHOW THAT VARIOUS CASH P AYMENTS WERE MADE TO THE ASSESESE BY HIS PROPRIETARY CONCERN DURING THE YEAR UNDER CONSIDERATION WHICH COULD BE CORRELATED WITH THE DE POSITS FOUND TO BE MADE IN HIS TWO SAVINGS BANK ACCOUNTS WITH ABN AMRO BANK. A PERUSAL OF THE SAID LEDGER ACCOUNT, HOWEVER, SHOWS THAT THE CASH WITHDRAWALS WERE MADE BY THE ASSESSEE FROM HIS PROPRIETARY CONC ERN MAINLY AGAINST CLOTH PURCHASES AND IT, THEREFORE, CANNOT BE SAID T HAT ALL THESE CASH WITHDRAWALS WERE AVAILABLE WITH THE ASSESEE FOR MAK ING DEPOSITS IN HIS SAVINGS BANK ACCOUNT WITH ABN AMRO BANK. NO DOUBT, THERE ARE CERTAIN CASH WITHDRAWALS APPEARING IN THE INDIVIDUAL ACCOUN T OF THE ASSESSEE IN THE BOOKS OF M/S. IMPEX INDIA, WHICH APPARENTLY ARE NOT AGAINST ANY CLOTH PURCHASE AND COINCIDE WITH THE DEPOSITS FOUND TO BE MADE BY THE ASSESSEE IN HIS TWO BANK ACCOUNTS WITH ABN AMRO BANK. SIMILA RLY AS POINTED OUT BY THE LD. COUNSEL FOR THE ASSESSEE, A SUM OF RS.2, 00,000/- CREDITED IN ONE BANK ACCOUNT OF THE ASSESSEE WITH ABN AMRO BANK AS ON 10.07.2007 WAS TRANSFERRED FROM ANOTHER BANK ACCOUNT MAINTAINED WI TH THE SAME BANK. 6. IT IS ALSO OBSERVED THAT THERE IS A MENTION IN T HE ASSESSMENT ORDER THAT CREDIT CARD BILLS AMOUNTING TO RS.11,16,000/- WERE PAID BY THE I.T.A. NO. 899/KOL./2013 ASSESSMENT YEAR: 2008-2009 PAGE 6 OF 7 ASSESSEE FROM HIS BANK ACCOUNTS WITH ABN AMRO BANK. A PERUSAL OF THE BANK ACCOUNTS OF THE ASSESSEE AS PLACED ON RECORD B EFORE US, HOWEVER, SHOWS THAT THERE ARE NO PAYMENTS AGAINST CREDIT CAR D BILLS TO THAT EXTENT AND EVEN THE TRANSACTIONS OF INVESTMENT IN SHARES A MOUNTING TO RS.15,04,894/- ARE NOT FULLY REFLECTED IN THE SAID ACCOUNTS. IN THIS REGARD, THE LD. COUNSEL FOR THE ASSESSEE HAS SUBMITTED BEFO RE US THAT THE AMOUNT OF RS.15,04,894/- REPRESENTS THE TOTAL SHARE TRANSA CTIONS ENTERED INTO BY THE ASSESSEE INCLUDING PURCHASE AND SALE OF SHARES AND IT IS NOT THE TOTAL AMOUNT OF INVESTMENT MADE BY THE ASSESSEE AS PRESUM ED BY THE ASSESSING OFFICER. HE HAS ALSO SUBMITTED THAT THERE BEING CAS H DEPOSITS AND CASH WITHDRAWALS REFLECTED IN THE SAVINGS BANK ACCOUNTS OF THE ASSESSEE, THE WITHDRAWALS MADE FOR MAKING CORRESPONDING DEPOSITS SHOULD BE TAKEN INTO CONSIDERATION. KEEPING IN VIEW THESE SUBMISSIO NS MADE BY THE LD. COUNSEL FOR THE ASSESSEE AS WELL AS HAVING REGARD T O THE NATURE OF ENTRIES APPEARING IN THE RELEVANT BANK ACCOUNTS OF THE ASSE SSEE, WE ARE OF THE VIEW THAT A DETAILED ANALYSIS OF ALL THE TRANSACTIO NS REFLECTED IN THE BANK ACCOUNTS OF THE ASSESSEE IS REQUIRED TO BE DONE AFT ER TAKING INTO CONSIDERATION THE NATURE OF EACH AND EVERY ENTRY AN D ON THE BASIS OF SUCH ANALYSIS, THE EXACT ADDITION TO BE MADE TO THE TOTA L INCOME OF THE ASSESSEE NEEDS TO BE WORKED OUT. WE, THEREFORE, RESTORE THIS ISSUE TO THE FILE OF THE ASSESSING OFFICER WITH A DIRECTION TO THE ASSESSEE TO MAKE A DETAILED ANALYSIS OF ALL THE ENTRIES APPEARING IN THE TWO BA NK ACCOUNTS OF THE ASSESSEE. THE ASSESSING OFFICER SHALL VERIFY THE SA ID ANALYSIS AND RE- COMPUTE THE ADDITION TO BE MADE ON THIS ISSUE AFTER GIVING THE ASSESSEE PROPER AND SUFFICIENT OPPORTUNITY OF BEING HEARD. 7. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS TRE ATED AS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON APRIL 29, 201 6. SD/- SD/- (S.S. VISWANETHRA RAVI) (P.M. JAGTAP) JUDICIAL MEMBER ACCOUNTANT MEMBER KOLKATA, THE 29 TH DAY OF APRIL, 2016 I.T.A. NO. 899/KOL./2013 ASSESSMENT YEAR: 2008-2009 PAGE 7 OF 7 COPIES TO : (1) SHRI HIMANGSHU DAS, C/O. P.K. HIMMATSINGHKA, AA-4, SALT LAKE, KOLKATA-700 064 (2) INCOME TAX OFFICER, WARD-51(1), KOLKATA, UTTARAPAN BUILDING, MANIKTALA CIVIC CENTRE, ULTADANGA, KOLKATA-700 054 (3) COMMISSIONER OF INCOME-TAX, KOLKATA; (4) CIT(APPEALS)-XXXII, KOLKATA; , (4) THE DEPARTMENTAL REPRESENTATIVE (5) GUARD FILE BY ORDER ASSISTANT REGISTRAR, INCOME TAX APPELLATE TRIBUNAL, KOLKATA BENCHES, KOLKATA LAHA/SR. P.S.