MUSTAK RAJJAK KAPADE,RATNAGIRI V. INCOME-TAX OFFICER, WARD-1, RATNAGIRI

ITA 889/PUN/2024

AI Insights

The case involves an appeal by Mustak Rajjak Kapade against the order of the Commissioner of Income Tax (Appeals) which confirmed an addition of Rs.4,00,000 to the assessee's income for the Assessment Year 2012-13. The addition was initially made by the Assessing Officer based on cash deposits noted in the assessee's bank accounts, which were suspected to be unexplained income. The assessee argued that these deposits were proceeds from the sale of mangoes, supported by agricultural income declared and relevant documentation. The Tribunal, after reviewing the submissions and evidence, concluded that the assessee had adequately explained the source of the deposits, leading to the decision to allow the appeal and delete the addition.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 30090 (ITAT-PUNE)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-01-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2012-2013
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: AKHILESH SRIVASTAVA
• Assessee Lawyers: ANUP BIPIN SHAHA
• Section: 148; 250; 139(1); 69A

Judgement Text

" ।आयकर अपीलीय अिधकरण ”एस एम सी” Ɋायपीठ पुणेमŐ। IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCHES “SMC” :: PUNE BEFORE DR.DIPAK P. RIPOTE, ACCOUNTANT MEMBER AND SHRI VINAY BHAMORE, JUDICIAL MEMBER आयकर अपील सं. / ITA No.889/PUN/2024 िनधाᭅरण वषᭅ / Assessment Year: 2012-13 Mustak Rajjak Kapade, C/o.Bipin Shaha, 1756, Jutica, Teli Ali, Ratnagiri – 415612. PAN: BPZPK7653G V s The Income Tax Officer, Ward-1,Ratnagiri. Appellant/ Assessee Respondent / Revenue Assessee by Shri Anup Bipin Shaha – AR Revenue by Shri Akhilesh Srivastava –Addl.CIT(DR) Date of hearing 06/01/2025 Date of pronouncement 22/01/2025 आदेश/ ORDER PER DR. DIPAK P. RIPOTE, AM: This is an appeal filed by the assessee against the order of ld.Commissioner of Income Tax(Appeals)[NFAC] passed under section 250 of the Income-tax Act, 1961 for Assessment Year 2012-13; dated 27.02.2024. The Assessee has raised the following grounds of appeal : “1. The Ld.CIT(A) has erred in law & failed to appreciate the facts and circumstances of the case by confirming the addition of Rs.4,00,000/- pertaining to cash deposits in the month of October, ITA No.889/PUN/2024 2 2011 and such addition made by Ld.AO is merely on basis of guess work and surmise. The Ld.CIT(A) and the Ld.AO erred in appreciating the explanation furnished by the assessee in respect of such cash deposit and made an addition which is against the provisions and spirit of the Act. The said addition be deleted and the assessee be granted just and proper relief in this respect. 2. The appellant craves to add, delete, alter, modify any of the grounds of appeal.” Submission of ld.AR : 2. Ld.AR for the Assessee filed a paper book and submitted that assessee had received the said cash on account of sale of mangoes. Assessee had explained these facts before Assessing Officer as well as ld.CIT(A). Ld.AR produced copies of the bills to demonstrate that it was on account of sale of mangoes. Ld.AR pleaded that therefore, additions need to be deleted. Ld.AR filed copies of 7/12 extract. Submission of ld.DR : 3. Ld.DR for the Revenue relied on the order of Assessing Officer and ld.CIT(A). Findings & Analysis : ITA No.889/PUN/2024 3 4. We have heard both the parties and perused the records. Admittedly, assessee had not filed Return of Income for the A.Y.2012-13 under section 139(1) of the Act. Assessee filed Return of Income only after issue of notice under section 148 of the Act. In the return of income, assessee declared agricultural income of Rs.5,36,820/- and Income of Rs.1,00,670/-. The Assessing Officer had received information regarding deposits of the Assessee in the bank. The Assessing Officer collected the copies of the bank statements from the Bank. Then based on the bank statements the Assessing officer in para 6 noted that the assessee had deposited Rs. 7,70,000/-during FY 2011-12 and there were Time Deposits totalling to Rs. 14,00,000/-. After considering the assessee’s submission, AO made an addition of Rs.19,26,464/-. Assessee filed appeal before ld.CIT(A). Ld.CIT(A) held that the Time deposits were pertaining to years prior to FY 2011-12 hence cannot be taxed in AY 2012-13 as the Assessing Officer in the Assessment Order has specifically mentioned date of Initial Deposit which was pertaining mainly to FY 2005-06,2006-07. Ld.CIT(A) sustained the addition of Rs.4,00,000/- only. The relevant paragraph of ld.CIT(A) is as under : ITA No.889/PUN/2024 4 “The submissions of the appellant are perused. The Assessee is having four savings bank accounts with Bank of India (as could be seen vide para no.3 of show cause notice dated 28.11.2019). The total cash deposits made in the all the bank accounts maintained with Bank of India during the FY 2011-12 relevant to AY 2012-13 was Rs.9,70,000/-. The appellant has already shown agricultural income of Rs.5,36,820/- for the year under consideration and has claimed that the cash deposit of Rs.4,00,000/- made on 19.10.2011 in the Account No.141410100008941 is summation of agricultural produce which he received from his debtors from time to time during the period July, 2011 to March, 2012, as this business involves credit system too. Even considering the appellant’s argument that the deposit of Rs.4,00,000/- was out of cumulative agricultural produce as true, still the appellant is not in a position to explain the sources for balance cash deposits of Rs.4,33,180/- (Rs.9,70,000 minus Rs.5,36,820) made in other three bank accounts. In view of the above discussion, the addition of Rs.4,00,000/- u/s 69A is sustained and this ground is dismissed.” 5. It is observed that Assessee had filed copies of the 7/12 extract which is the Revenue Record, to demonstrate that assessee is an agriculturalist and as per 7/12 extract, the crop shown is Mango. Assessee has filed copies of 7/12 extract showing mango crop from F.Y.2007-08 to 2013-14. Assessee has also filed copies of the bills issued by various wholesale fruit merchants pertaining to the F.Y.2011-12 to demonstrate that assessee had received cash during the period from sale of Mangoes. These facts have not been disputed by ld.CIT(A). Ld.CIT(A) in the para 5.2 which we have already reproduced has stated that cash deposits were Rs.9,70,000/- ITA No.889/PUN/2024 5 , but agricultural income shown is Rs.5,36,820/-, hence, ld.CIT(A) confirmed the addition of Rs.4,00,000/-. However, ld.CIT(A) erred in not appreciating the fact that agricultural income of Rs.5,36,820/- shown by the assessee in the Return of Income is the Net Income after expenditure. Therefore, the Gross Receipts will obviously be more than Rs.5,36,820/-. Ld.CIT(A) has also stated that cash deposit was Rs.9,70,000/-. However, it is observed that as per assessment order, the cash deposits were Rs.7,70,000/-, out of which the AO made addition of Rs.6,00,000/-. In these facts, there is an apparent error in the calculation of the ld.CIT(A). However, we have already mentioned that agricultural income shown by the assessee in the Return of Income is Rs.5,36,820/- which is Net Income. The assessee has filed copies of the bills which total approximately Rs.6,34,147/-. Neither Assessing Officer, nor ld.CIT(A) has doubted these bills. Thus, assessee has filed evidence to support the claim. In these facts and circumstances of the case, we are of the opinion that the Ld.CIT(A) has erred in sustaining the addition of Rs.4,00,000/-, accordingly we direct the AO to delete the addition. Accordingly, grounds of appeal raised by the assessee are allowed. ITA No.889/PUN/2024 6 6. In the result, appeal of the assessee is allowed. Order pronounced in the open Court on 22nd January, 2025. Sd/- Sd/- (VINAY BHAMORE) (DR. DIPAK P. RIPOTE) JUDICIAL MEMBER ACCOUNTANT MEMBER पुणे / Pune; ᳰदनांक / Dated : 22nd Jan, 2024/ SGR* आदेशकᳱᮧितिलिपअᮕेिषत / Copy of the Order forwarded to : 1. अपीलाथᱮ / The Appellant. 2. ᮧ᭜यथᱮ / The Respondent. 3. The CIT(A), concerned. 4. The Pr. CIT, concerned. 5. िवभागीयᮧितिनिध, आयकर अपीलीय अिधकरण, “एस एम सी” बᱶच, पुणे / DR, ITAT, “SMC” Bench, Pune. 6. गाडᭅफ़ाइल / Guard File. आदेशानुसार / BY ORDER, // TRUE COPY // Senior Private Secretary आयकर अपीलीय अिधकरण, पुणे/ITAT, Pune. "