Manas Ranjan Mohanty, Bhubaneswar V. ACIT, Bhubaneswar

ITSSA 4/CTK/2010

• Counselvise Citation: [2011] 124 COUNSELVISE.COM (IT) 8427 (ITAT-CUTTACK)
• Duration Of Justice: 11 month(s) 1 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 04-04-2011
• Appeal Filed By: Assessee
• Bench Allotted: DB
• Assessment Year: 2002-2003
• Appeal Filed On: 03-05-2010
• Court: TRIBUNAL
• Department Lawyers: P C MOHANTY
• Assessee Lawyers: B K DASH
• Section: 2

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL, CUTTACK BENCH, CUTTACK ( ) BEFORE . . , , HONBLE SHRI K.K.GUPTA, ACCOUNTANT MEMBER. /AND . . . , S HRI K.S.S.PRASAD RAO , JUDICIAL MEMBER / I.T (SS) A.NO. 04/CTK/2010 / ASSESSMENT YEAR 2002 - 03 MANAS RANJAN MOHANTY, PLOT NO.1680, NILAKANTHA NAGAR, BHUBANESWAR PAN NO.AHCPM 5298 B - - - VERSUS - ASST.COMMISSIONER OF INCOME - TA X , CIRCLE 1(2), BHUBANESWAR. ( /APPELLANT ) ( / RESPONDENT ) / FOR THE APPELLANT : / SHRI B.K.DASH, AR / FOR THE RESPONDENT: / SHRI P.C.MOHANTY, DR / ORDER . . . , , SHRI K.S.S.PRASAD RAO, JUDICIAL MEMBER . THIS APPEAL IS FILED BY THE ASSESSEE HAVING BEEN AGGRIEVED BY THE ORDER OF THE COMMISSIONER OF INCOME - TAX (APPEALS) DT.18.2.2010 FOR THE ASSESSMENT YEAR 2002 - 03 IN THE CASE OF THE ASSESSEE. 2. THE ASSESSEE HAS RAISED THE SOLE ISSUE CHALLENGING THE ADDITION OF 4 LAKHS MADE BY THE ASSESSING OFFICER AND UPHELD BY THE LEARNED CIT(A) WITHOUT APPRECIATING THE FACTS OF THE CASE PROPERLY. 3. BOTH THE PARTIES WERE HEARD REGARDING THE ISSUE AND ITS LEGAL IMPLICATION . 4. THE FACTS, IN BRIEF, ARE THAT THE ASSESSEE IS ENGAGED IN THE BUSINESS OF LABOUR CONTRACT AND CIVIL CONSTRUCTION HOLDING - CLASS LICENSE FROM GOVERNMENT OF ORISSA .HE HAD GROSS TURNOVER OF 16.20 LAKHS AND RS.22.25 LAKHS IN THE AYS 1999 - 00 AND 2000 - 01 RE SPECTIVELY. THE ASSESSEE IS MANAGING THE BUSINESS ON CASH BASIS . HE FILED THE RETURNS FOR THESE TWO AYS BY ESTIMATING I.T(SS)A.NO. 04/CTK/2010 2 HIS PROFIT U/S.44AD OF THE INCOME - TAX ACT,1961. THE ASSESSEE IS NOT MAINTAINING ANY DAY TO DAY RECORDS OR CASH/BANK TRANSACTIONS HE IS MAI NLY MANAGING THE BUSINESS ON AVAILABLE CASH. THE RETURN FILED BY THE ASSESSEE WAS TAKEN UP FOR SCRUTINY ASSESSMENT, AFTER ISSUING NECESSARY STATUTORY NOTICES REQUIRED UNDER THE LAW. IN RESPONSE TO THE NOTICE U/S.153C , THE ASSESSEE REQUESTED THE ASSESSING OFFICER TO SUPPLY THE SEIZED MATERIAL, WHICH WERE PROVIDED TO THE ASSESSEE ON 24.10.2007. LATER ON, THE ASSESSING OFFICER HAS ISSUED A LETTER ON 7.11.2007 ASKING THE ASSESSEE TO FURNISH THE SOURCE OF CASH DEPOSITS OF 4 LAKHS, AS SHOWN IN THE BANK ACCOUNT ON 14.9.2001 IN THE BANK OF MAHARASTRA, NAYAPALI, BHUBNAESWAR. THE ASSESSEE REPLIED STATING THAT CASH DEPOSIT OF 4 LAKHS MADE ON 14.9.2001 WAS OUT OF CASH BALANCE AVAILABLE FROM CASH WITHDRAWALS OF 2,50,000 ON 30.8.2001. THE ASSESSING OFFICER HAS NOT ACC EPTED THIS CONTENTION OF THE ASSESSEE AND TREATED THE SAID 4 LAKHS AS INVESTMENT OUT OF UNDISCLOSED SOURCES AND ACCORDINGLY ADDED TO THE TOTAL INCOME OF THE ASSESSEE. AGGRIEVED BY THIS ORDER OF ASSESSMENT, THE ASSESSEE WENT IN APPEAL BEFORE THE LEARNED C IT(A) AND IS UNSUCCESSFUL. THEREFORE, THE ASSESSEE HAS FILED THE PRESENT APPEAL BEFORE THE TRIBUNAL. 5. DURING THE COURSE OF HEARING, THE LEARNED AR OF THE ASSESSEE HAS VEHEMENTLY ARGUED CONTENDING INTER ALIA THAT THE ACTION OF THE ASSESSING OFFICER IN ADD ING 4 LAKHS AS UNEXPLAINED DEPOSIT IN THE BANK ACCOUNT IS NOT SUSTAINABLE , MORE SO , PARTICULAR LY WHEN THE ASSESSEE HAS PLEADED THAT HE MADE THE SAID DEPOSIT OUT OF THE PREVIOUS WITHDRAWALS FROM THE SAME BANK ACCOUNT, WHICH CLEARLY SHOWS THAT HE HAS WITHDRAWN MORE THAN 4 LAKHS PRIOR TO THE DATE OF DEPOSIT, AS CAN BE SEEN FROM THE SAID BANK ACCOUNT ITSELF. THERE ARE WITHDRAWALS OF 40,000 ON 21.8.2001, 2,50,000 ON 30.8.2001 AND 5,600 ON 5.9.2001.THIS ITSELF CLEARLY SHOWS THAT THE WITHDRAWALS ARE AROUND 3 LAKH S. N THAT WAY, THE DEPOSIT OF 4 LAKHS IS EXPLAINED BY THE ASSESSEE I.T(SS)A.NO. 04/CTK/2010 3 CATEGORICALLY AND HENCE, THE ADDITION MADE BY THE ASSESSING OFFICER AND SUSTAINED BY THE LEARNED CIT(A) IS NOT SUSTAINABLE FOR LEGAL SCRUTINY AND REQUIRES TO BE SET ASIDE. IN SUPPORT OF H IS CONTENTION, HE RELIED ON THE DECISION OF HONBLE PUNJAB & HARYANA HIGH COURT IN THE CASE OF CIT V. PREMWATI [ 2008 (174) TAXMAN 68]. 6. CONTRARY TO THIS, THE LEARNED DR HAS VEHEMENTLY ARGUED SUPPORTING THE IMPUGNED ORDERS OF THE LEARNED CIT(A). 7. ON CAR EFUL ANALYSIS OF THE ORDERS PASSED BY THE DEPARTMENTAL AUTHORITIES IN THE LIGHT OF THE RIVAL SUBMISSIONS OF BOTH THE PARTIES AND THE MATERIAL MADE AVAILABLE TO THE TRIBUNAL, IT IS FOUND THAT THE ASSESSEE HAS FILED WRITTEN SUBMISSIONS DT.25 .2.2011 WHEREIN O N PAGE 2 THEREOF, THE CASH DEPOSITS AND CASH WITHDRAWALS FROM THE DISPUTED BANK ACCOUNT HAVE BEEN GIVEN. IT DISCLOSES THAT THERE ARE WITHDRAWALS OF 40,000 ON 21.8.2011 AND 2,50,000 ON 30.8.2001, 5,600,000 ON 5.9.2001 AND THERE IS DEPOSIT OF 4 LAKHS ON 14.9.2001 (DISPUTED AMOUNT). THIS ITSELF SHOWS THAT THE ASSESSEE HAS ONLY CASH OF 2,95,600 WITH HIM PRIOR TO THE DATE OF DEPOSIT ON 14.9.2001 OF 4 LAKHS. THERE IS NO EXPLANATION OFFERED BY THE ASSESSEE FOR THEBALANCE OF APPROXIMATELY 1 LAKHS (I.E., 4 LAKHS MINUS 2,95,600).THEREFORE, THE ASSESSEES EXPLANATION IS NOT AT ALL TENABLE UNDER LAW AS IT IS NOT SUPPORTED BY EVIDENCE. ADMITTEDLY THE ASSESSEE IS NOT MAINTAINING ANY PARTICULARS OF HIS BUSINESS AND THE EXPENDITURE AND INCOME DERIVED THERE FROM . HE IS ONLY MANAGING THE AVAILABLE CASH ON HAND. IN THAT VIEW OF THE MATTER, AS THE ASSESSEE IS NOT HAVING SUM OF 4 LAKHS ON 14.9.2001 WHEN THE AMOUNT OF 4 L AKHS WAS DEPOSITED IN THE BANK ACCOUNT , WHEREAS THERE IS PREVIOUS WITHDRAWAL OF 2,95,600 AS ST ATED EARLIER. THEREFORE, THE DECISION RELIED ON BY THE ASSESSEE RENDERED BY HONBLE PUNJAB & HARYANA HIGH COURT IN THE CASE OF CIT V. PREMWATI (SUPRA), IS DISTINGUISHABLE ON FACTS. HENCE, HE CANNOT CLAIM I.T(SS)A.NO. 04/CTK/2010 4 THE SUPPORT OF THE SAID DECISION. THEREFORE, THE AS SESSEE HAVING BEEN NOT ABLE TO PROPERLY EXPLAIN THE SOURCE OF DEPOSIT OF 4 LAKHS IN THE BANK MADE ON 14.9.2001 AS REQUIRED BY THE ASSESSING OFFICER, WE ARE OF THE CONSIDERED VIEW THAT THE ADDITION MADE BY THE ASSESSING OFFICER AND CONFIRMED BY THE LEARNE D CIT(A) IS JUSTIFIED AND THE SAME NEEDS NO INTERFERENCE. WE UPHOLD THE ORDER OF THE LEARNED CIT(A) AND DISMISS THE APPEAL OF THE ASSESSEE. 8. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS DISMISSED. THIS ORDER IS PR ONOUNCED IN OPEN COURT ON DT. 4 TH APRIL, 2011 SD/ - SD/ - ( . . ) , , (K.K.GUPTA), ACCOUNTANT MEMBER. ( . . . ) , (K.S.S.PRASAD RAO), JUDICIAL MEMBER. ( ) DATE: 4 TH APRIL, 2011 - COPY OF THE ORDER FORWARDED TO: 1 . / THE APPELLANT : MANAS RANJAN MOHANTY, PLOT NO.1680, NILAKANTHA NAGAR, BHUBANESWAR PAN NO.AHCPM 5298 B 2 / THE RESPONDENT: ASST.COMMISSIONER OF INCOME - TAX , CIRCLE 1(2), BHUBANESWAR. 3 . / THE CIT, 4 . ( )/ THE CIT(A), 5 . / DR, CUTTACK BENCH 6 . GUARD FILE . / TRUE COPY, / BY ORDER, [ ] SENIOR PRIVATE SECRETARY ( ), ( H.K.PADHEE ), SENIOR.PRIVATE SECRETARY.