MANOJ KUMAR JAIN (HFU), DURG,DURG V. INCOME TAX OFFICER 2(2), BHILAI, DURG

ITA 240/RPR/2024

AI Insights

The case involves Manoj Kumar Jain, who appealed against the order of the Commissioner of Income-Tax (Appeals), which confirmed the addition of Rs. 25,00,000 to his income as unexplained money under Section 69A of the Income Tax Act, 1961. This amount was deposited in his bank account in Specified Bank Notes during the demonetization period on November 12, 2016. The Assessing Officer initially added this amount as unexplained money, which was upheld by the CIT(Appeals). The Tribunal dismissed the appeal, agreeing with the lower authorities that the assessee failed to provide adequate evidence to explain the source of these deposits.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 35766 (ITAT-RAIPUR)
• Duration Of Justice: 4 month(s) 14 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-10-2024
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: SMC
• Next Hearing Date: 01-10-2024
• Assessment Year: 2017-2018
• Appeal Filed On: 24-05-2024
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: PRIYANKA PATEL
• Assessee Lawyers: RAVI AGRAWAL
• Keywords: Business income; Opportunity of being heard; Additional evidence; Principle of natural justice; Deemed to accrue or arise in india
• Section: 143(3); 143(2); 13; 69A

Judgement Text

"आयकर अपीलȣय अͬधकरण Ûयायपीठ “एक-सदèय” मामला रायपुर मɅ IN THE INCOME TAX APPELLATE TRIBUNAL RAIPUR BENCH “SMC”, RAIPUR Įी रवीश सूद, ÛयाǓयक सदèय क े सम¢ BEFORE SHRI RAVISH SOOD, JUDICIAL MEMBER आयकर अपील सं. / ITA No. 240/RPR/2024 Ǔनधा[रण वष[ / Assessment Year : 2017-18 Manoj Kumar Jain (HUF) Apapura, Bhoipara, Durg-491 001 (C.G.) PAN: AALHM0106J .......अपीलाथȸ / Appellant बनाम / V/s. The Income Tax Officer-2(2), Bhilai (C.G.) ……Ĥ×यथȸ / Respondent Assessee by : Shri Ravi Agrawal, CA Revenue by : Dr. Priyanka Patel, Sr. DR सुनवाई कȧ तारȣख / Date of Hearing : 01.10.2024 घोषणा कȧ तारȣख / Date of Pronouncement : 08.10.2024 2 Manoj Kumar Jain Vs. ITO-2(2), Bhilai ITA No. 240/RPR/2024 आदेश / ORDER PER RAVISH SOOD, JM: The present appeal filed by the assessee is directed against the order passed by the Commissioner of Income-Tax (Appeals), National Faceless Appeal Center (NFAC), Delhi, dated 14.03.2024, which in turn arises from the order passed by the A.O under Sec.143(3) of the Income- tax Act, 1961 (in short ‘the Act’) dated 03.12.2019 for the assessment year 2017-18. The assessee has assailed the impugned order on the following grounds of appeal: “1) On facts and in the circumstances of the case, order passed by CIT(A) is not as per law because it was passed without giving proper and reasonable opportunity of being heard as per demand of law and principle of natural justice. 2) On facts and in the circumstances of the case, order passed by CIT(A) is not as per law because it was passed by ignoring adjournment request filed by the assessee on 28.02.2024 in respect of last notice issued on 12.02.2024 with no remark \"Final Opportunity\". 3) Without prejudice to ground nos. 1 & 2, CIT(A) has erred in dismissing appeal without deciding the appeal on merit of the case properly and judicially.. 4) On the facts and in the circumstances of the case CIT(A) erred in confirming addition of Rs. 25,00,000/- made by the Assessing Officer by treating cash deposited during demonetization period on 12.11.2016 in Specified Bank Notes to the extent of Rs. 25,00,000/- in saving bank account with \"State Bank of India, Chauhan Estate Building, G.E. Road, Supela, Bhilai\" as unexplained money u/s 69A and levying tax thereon as per provisions of section 115BBE(1) of the Act @ 60% by treating it as non-business receipts without giving any basis or relying on any evidences and also without considering the facts and circumstances of the case properly and judicially. 3 Manoj Kumar Jain Vs. ITO-2(2), Bhilai ITA No. 240/RPR/2024 The assessee prays that the addition of Rs. 25,00,000/- made u/s 69A be deleted. 5) Without prejudice to ground no. 4, on facts and in the circumstances of the case and in law, CIT(A) has erred in confirming action of Assessing Officer in levying tax u/s 115BBE(1) @ 60% on alleged unexplained money assessed u/s 69A since assessee had made said transaction even prior to amendment proposed in the \"The Taxation Law (Second Amendment) Bill, 2016\" put up before house of Parliament on 26.11.2016 to tax deemed income u/s 115BBE @ 60% then existing rate of 30%, which received ascent of Hon'ble President of India on 15.12.2016, and said amendment was substantive in nature, hence, either it would apply prospectively to the transactions made on or after 15.12.2016 and not retrospectively to the transactions made during the period from 01.04.2016 to 14.12.2016 or apply from A.Y. 2018/19 onwards. The assessee prays that the income-tax be charged on such transactions @ 30%. 6) The assessee reserves the right to add, amend, alter or withdraw any ground/grounds of appeal at the time of hearing.” 2. Shri Ravi Agrawal, Ld. Authorized Representative (for short ‘AR’) for the assessee at the threshold submitted that the present appeal involves a delay of 11 days. Elaborating on the reasons leading to the delay, it was submitted by the Ld. AR that the assessee had received the order of the CIT(Appeals) dated 14.03.2024 through email on 27.03.2024. The Ld. AR in support of his aforesaid contention had filed before me an application dated 03.06.2024 seeking condonation of the delay a/w. an “affidavit” dated 02.06.2024 of the assessee. As is discernible from the documents filed before me by both the assessee and the revenue, nothing can be gathered therefrom which would reveal that the CIT(Appeals)’s order dated 14.03.2024 was dropped in the email id provided by the assessee in Form 4 Manoj Kumar Jain Vs. ITO-2(2), Bhilai ITA No. 240/RPR/2024 35 i.e. cajain096@gmailcom on 27.03.2024. Considering the aforesaid facts, I am of the view that as the delay involved in the present appeal is not inordinate, therefore, the same merits to be condoned. 3. Succinctly stated, the assessee had filed his return of income for A.Y.2017-18 on 22.07.2017, declaring an income of Rs.6,69,710/-. Subsequently, the case of the assessee was selected for scrutiny assessment u/s. 143(2) of the Act. 4. During the course of the assessment proceedings, it was observed by the A.O that the assessee had made cash deposits of Rs.25 lacs in SBNs in his bank account during the demonetization period, i.e. on 12.11.2016. Also, the A.O observed that the assessee had, thereafter, withdrawn an amount of Rs.24,000/- on 13 occasions and Rs.15,000/- on two occasions till 21.02.2017. Although, it was the claim of the assessee that as per the registration certificate issued by the Sub-Registrar, Durg, the assessee was engaged in pawning business since 11.07.2023, but he had failed to relate the subject cash deposits in his bank account. The A.O observed that as the assessee had failed to produce Girvi Register, thus, he had failed to authenticate the source of the cash deposits which was claimed by him to have been received by him from his pawning business. Also, the assessee had placed on record an incomplete copy of the bank statement for the year under consideration, i.e. for the period 12.11.2016 to 21.02.2017. 5 Manoj Kumar Jain Vs. ITO-2(2), Bhilai ITA No. 240/RPR/2024 The A.O observed that the assessee belonged to a renowned business background in the field of gold, silver and other jewellery in the region. As the assessee had failed to substantiate the source of the cash deposits made in his bank account during the demonetization period, i.e. on 12.11.2016, therefore, the A.O held the amount of Rs.25 lacs as his unexplained money and made an addition of the same u/s. 69A of the Act. Accordingly, the A.O vide his order passed u/s. 143(3) of the Act, dated 03.12.2019, after making the aforesaid addition determined the income of the assessee at Rs.31,69,710/-. 5. Aggrieved, the assessee carried the matter in appeal before the CIT(Appeals). As the assessee in the course of the proceedings before the first appellate authority, had failed to point out any infirmity to the observations of the A.O based on any supporting material, therefore, the CIT(Appeals) taking cognizance of the said material fact approved the addition of Rs.25 lacs made by the A.O. For the sake of clarity, the observation of the CIT(Appeals) are culled out as under: “5. Findings: The Grounds of appeal, the facts and circumstances of the case, the submissions of the assessee have been carefully considered. The facts of the case are that the assessee deposited Rs.25,00,000/- in his bank account on 12.11.2016. The complete bank statement was not produced. Girvi register was not produced. Assessee was asked to produce bank statement from 01.04.2014 to 31.03.2017. The assessee chose to confine furnishing of bank statement for 12.11.2016 to 21.02.2017. 6 Manoj Kumar Jain Vs. ITO-2(2), Bhilai ITA No. 240/RPR/2024 Assessee did not produce any cash book nor any evidence to reflect the cash in flow and out flows relating to he business during the financial year relevant. Accordingly, Assessing Officer added cash deposit u/s 69A. 6. The assessee being aggrieved with the order of the CIT(Appeals) has carried the matter in appeal before the tribunal. 7. I have heard the Ld. Authorized Representatives of both the parties, perused the orders of the lower authorities and the material available on record. 8. The Ld. AR for the assessee at the threshold referred to an application filed under Rule 29 of the Income Tax Appellate Tribunal Rules, 1963, wherein liberty was sought for admission of certain documents i.e., Page Nos.1 to 93 as “additional evidence”. The Ld. AR on being queried as to why the aforesaid documents were not filed before the lower authorities, failed to come forth with any plausible explanation. Ostensibly, the assessee both before the A.O and the CIT(Appeals), had failed to substantiate his claim that the cash deposits of Rs.25 lacs in SBNs made during the demonetization period, i.e. on 12.11.2016 were sourced out of his pawning business. In fact, on a perusal of the order of the CIT(Appeals), it transpires that the assessee instead of coming forth with any explanation as regards the source of the cash deposits, had merely filed/uploaded before him the “grounds of appeal” and had not 7 Manoj Kumar Jain Vs. ITO-2(2), Bhilai ITA No. 240/RPR/2024 placed any material/ submission to explain the source of the subject cash deposits. 9. After considering the aforesaid facts, I am of the view that as the assessee had failed to come forth with any plausible explanation as to why the aforesaid documents that had been filed before me as “additional evidence” could not be filed before the lower authorities, therefore, I decline to admit the same. Accordingly, the application filed by the assessee seeking admission of additional evidence is rejected. 10. I have given a thoughtful consideration to the orders of the lower authorities and find no infirmity in the same. I, say so, for the reason that as the assessee had failed to substantiate the source of the cash deposits of Rs.25 lacs made in SBNs in his bank account during the demonetization period, i.e. on 12.11.2016, therefore, both the lower authorities were left with no other alternative but to treat the same as the assessee’s unexplained money u/s. 69A of the Act. 11. In the result, the appeal of the assessee is dismissed in terms of the aforesaid observations. Order pronounced in open court on 08th day of October, 2024. Sd/- (रवीश सूद /RAVISH SOOD) ÛयाǓयक सदèय/JUDICIAL MEMBER रायपुर/ RAIPUR ; Ǒदनांक / Dated : 08th October, 2024. 8 Manoj Kumar Jain Vs. ITO-2(2), Bhilai ITA No. 240/RPR/2024 *******SB, Sr. PS आदेश कȧ ĤǓतͧलͪप अĒेͪषत / Copy of the Order forwarded to : 1. अपीलाथȸ / The Appellant. 2. Ĥ×यथȸ / The Respondent. 3. The CIT(Appeals)-1, Raipur (C.G) 4. The Pr. CIT-1, Raipur (C.G) 5. ͪवभागीय ĤǓतǓनͬध, आयकर अपीलȣय अͬधकरण,रायपुर बɅच, रायपुर / DR, ITAT, Raipur Bench, Raipur. 6. गाड[ फ़ाइल / Guard File. आदेशानुसार / BY ORDER, // True Copy // Senior Private Secretary आयकर अपीलȣय अͬधकरण, रायपुर / ITAT, Raipur. "