The ACIT, 5(1), Indore V. Shri Mayur Kothari, Indore

ITSSA 129/IND/2012

• Counselvise Citation: [2012] 121 COUNSELVISE.COM (IT) 8208 (ITAT-INDORE)
• Duration Of Justice: 2 month(s) 2 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 02-07-2012
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: misc
• Appeal Filed On: 30-04-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: KESHAV SAXENA
• Assessee Lawyers: MAYUR KOTHARI
• Keywords: Search and seizure; Accommodation entries
• Section: 40A(3)

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL INDORE BENCH, INDORE BEFORE SHRI JOGINDER SINGH, JUDICIAL MEMBER AND SHRI R.C. SHARMA, ACCOUNTANT MEMBER ITA NO. 129/IND/2012 A.Y.2003-04 ASSTT. COMMISSIONER OF INCOME TAX 5(1) INDORE :: APPELLANT VS SHRI MAYUR KOTHARI INDORE :: RESPONDENT APPELLANT BY SHRI KESHAV SAXENA RESPONDENT BY SHRI MAYUR KOTHARI DATE OF HEARING 02.07.2012 DATE OF PRONOUNCEMENT 02.07.2012 O R D E R PER JOGINDER SINGH , JUDICIAL MEMBER THE REVENUE IS AGGRIEVED BY THE ORDE R DATED 27.2.2012 OF THE LEARNED CIT(A). FOLLOWING GROUND S HAVE BEEN TAKEN BY THE REVENUE :- 2 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE THE ORDER OF THE LD. CIT(APPEALS) IS CONTRARY TO THE FA CTS AND THE LAW. 2. WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE LD. CIT(A) HAS ERRED IN HOLDING THAT T HE CASH DEPOSITED BY THE ASSESSEE IN HIS BANK ACCOUNTS REPRESENT THE AMOUNT OF ACCOMMODATION BILLS AND THEREBY DELETED THE ADDITION WHEN NONE OF THE BENEFICIARIES HAD ACCEPTED THAT ANY CASH WAS GIVEN TO THE ASSESSEE. 3. WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE LD. CIT(APPEALS) HAS ERRED IN DELETING THE ADDITION ON THE BASIS OF ADDITIONS MADE IN THE CASE S OF THE BENEFICIARIES WITHOUT APPRECIATING THAT THE ADDITIONS MADE IN THE HANDS OF THE BENEFICIARIES WE RE U/S 40A(3) VIDE CASH RECEIVED BACK BY THEM FROM THE ASSESSEE AGAINST THEIR CHEQUES WHICH WAS UTILISED I N MAKING PAYMENTS IN CASH TO THE THIRD PARTIES FROM WHOM ACTUALLY THE PURCHASES WERE EFFECTED BY THE BENEFICIARIES. 2. DURING HEARING OF THIS APPEAL, WE HAVE HEARD SHRI KESHAV SAXENA, LEARNED CIT DR AND THE ASSESSEE IN PERSON. AT THE OUTSET, THE ASSESSEE ASSERTED THAT REQUISITE ADDITI ONS HAVE ALREADY BEEN MADE IN THE HANDS OF THE BENEFICIARIES BY THE LEARNED ASSESSING OFFICER WHICH HAVE BEEN CONFIRMED BY THE LEARNED CIT(A), THEREFORE, NO DOUBLE ADDITION IS PE RMISSIBLE. THIS ASSERTION OF THE ASSESSEE WAS NOT CONTROVERTED BY T HE REVENUE. 2. 1 WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PERU SED THE MATERIAL AVAILABLE ON RECORD. THE FACTS IN BRIEF A RE THAT THE ASSESSEE WAS DOING BOGUS BILLING BUSINESS OF IRON I TEMS. AN 3 ADDITION OF RS.20,11,900/- WAS MADE IN THE HANDS OF THE ASSESSEE ON ACCOUNT OF UNEXPLAINED DEPOSITS IN HIS BANK ACCOUNT WHICH WAS RELATING TO BOGUS BILLING. THESE ADDITIONS WERE CLAIMED TO BE ON ACCOUNT OF SALE PROCEEDS OF B OGUS BILLS FOR WHICH NO SUPPLIES WERE EVER MADE AND COMMISSION INC OME WAS EARNED FROM THE PARTIES IN WHOSE NAMES SUCH BOGUS B ILLS WERE ISSUED. THE BENEFICIARIES OF THE DEPOSITS ARE THE P ARTIES WHO WERE RECEIVING BOGUS BILLS. A SEARCH AND SEIZURE OPERATI ON WAS CARRIED OUT AND NO REGULAR BOOKS OF ACCOUNTS, BILLS, VOUCHE RS WERE FOUND. THE STATEMENT OF THE ASSESSEE WAS RECORDED U /S 132(4) ON 30.9.2008 WHEREIN HE ACCEPTED THAT HE WAS ENGAGE D IN THE BUSINESS OF ISSUING BOGUS BILLS OF IRON AND STEEL T O VARIOUS PARTIES. THE ASSESSEE USED TO CHARGE RS. 40/-, PER TON, AS COMMISSION. THUS, THE ASSESSEE DECLARED TOTAL SALE OF STEEL TO THE TUNE OF RS.5,11,40,536/- (ON COMMISSION BASIS). TH E DETAILS OF THE SAME ARE AVAILABLE AT PAGE 6 OF THE ASSESSMENT ORDER. THE AMOUNT OF RS,20,11,900/- WAS ADDED AS UNEXPLAINED I NCOME. ON APPEAL, THE LEARNED CIT(A) DELETED THE SAME BY O BSERVING AS UNDER :- 4 4.4 GROUND NO. 4, 5 AND 6 ARE AGAINST AN ADDITION OF RS. 20,11,900/- ON ACCOUNT OF UNEXPLAINED DEPOSITS IN BANK. FROM THE ASSESSMENT ORDER IT IS SEEN THAT THE A.O. HAS ACCEPTED THAT TH E APPELLANT IS ENGAGED IN PROVIDING ACCOMMODATION ENTRIES AND HE HAS ASSESSED COMMISSION INCOME FROM SUCH ACCOMMODATION BUSINESS BUT AT THE SAME TIME HE HAS MADE ADDITION OF RS. 20,11,900/- ON ACCOUNT OF UNEXPLAINED CASH DEPOSITS IN BANK WHICH IS NOT PROPER. IN THE CASES OF BENEFICIARIES REQUI SITE ADDITIONS HAVE BEEN MADE BY THE A.O. AND HAVE BEEN CONFIRMED BY ME IN APPEAL. THEREFORE, THERE IS NO JUSTIFICATION OF MAKING ADDITION OF RS. 20,11,90 0/- ON ACCOUNT OF BANK DEPOSITS TREADING THE SAME AS UNEXPLAINED IN THE HANDS OF APPELLANT, WHEN HE IS NOT THE OWNER OF FUNDS. THE SAME IS NOT FOUND TO HAVE BEEN PROPERLY MADE IS CLEARLY AGAINST THE ADMITTED FACTS ON RECORD AND IS, THEREFORE, DELETED . THESE GROUNDS ARE ALLOWED. 2.2 WE FIND THAT THERE IS AN UNCONTROVERTED FINDING IN THE IMPUGNED ORDER THAT THE REQUISITE ADDITIONS IN THE HANDS OF THE BENEFICIARIES HAVE ALREADY BEEN MADE BY THE LEARNED ASSESSING OFFICER AND THE SAME WERE ALSO AFFIRMED IN APPEAL B Y THE LEARNED CIT(A). IN THE IMPUGNED ORDER, THERE IS ANOTHER UNC ONTROVERTED FINDING THAT THE IMPUGNED AMOUNTS WERE NOT OWNED BY THE ASSESSEE, THEREFORE, THERE IS NO JUSTIFICATION IN M AKING THE ADDITION IN THE HANDS OF THE ASSESSEE AS THE IMPUGN ED AMOUNTS HAVE ALREADY BEEN ADDED IN THE HANDS OF THE RESPECT IVE BENEFICIARIES. NO DOUBLE ADDITION IS PERMISSIBLE O F THE SAME 5 AMOUNT, THEREFORE, WE FIND NO INFIRMITY IN THE STAN D OF THE LEARNED CIT(A). IT IS AFFIRMED. FINALLY, THE APPEAL OF THE REVENUE IS HAVING NO ME RIT, CONSEQUENTLY, DISMISSED. THIS ORDER WAS PRONOUNCED IN THE OPEN COURT IN THE PRESENCE OF LD. REPRESENTATIVES FROM BOTH SIDES AT THE CONCLUSION OF THE HEARING ON 2 ND JULY, 2012. SD SD (R.C.SHARMA) (JOGINDER SINGH ) ACCOUNTANT MEMBER JUDICIAL ME MBER DATED: 2 ND JULY,2012 COPY TO: APPELLANT, RESPONDENT, CIT, CIT(A), DR, GU ARD FILE DN/-22