PRADEEP KUMAR KOHLI,AGRA V. CIRCLE2(1)(1) AGRA, AGRA

ITA 19/AGR/2023

AI Insights

The case involves Shri Pradeep Kumar Kohli, who appealed against the order of the Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi, which confirmed the addition of Rs. 49.87 Lacs to his income for the Assessment Year 2017-18. The addition was initially made by the Assessing Officer under section 143(3) of the Income Tax Act, alleging that the assessee had artificially inflated cash-in-hand through abnormal cash sales in October 2016 compared to earlier years. The assessee argued that the sales were legitimate and reflected in audited books and VAT returns. The Tribunal found that the books were not rejected and no defects were pointed out, leading to a reduction of the addition to Rs. 5 Lacs as normal business income.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 523717 (ITAT-AGRA)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-03-2025
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: DB
• Assessment Year: 2017-2018
• Laws Referred To: Income Tax Act
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: SHAILENDRA SHRIVASTAVA LD.
• Assessee Lawyers: ANURAG SINHA; LD
• Keywords: Business income
• Section: 143(3)

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL “DB” BENCH, AGRA BEFORE HON’BLE SHRI SATBEER SINGH GODARA, JM AND HON’BLE SHRI MANOJ KUMAR AGGARWAL, AM आयकरअपीलसं./ ITA No.19/Agr/2023 (िनधाŊरणवषŊ / Assessment Year: 2017-18) Shri Pradeep Kumar Kohli 14/69 Hospital Road, Agra बनाम/ Vs. ACIT-Circle-2(1)(1), Agra ̾थायीलेखासं./जीआइआरसं./PAN/GIR No.ADPK-9860-R (अपीलाथŎ/Appellant) : (ŮȑथŎ / Respondent) अपीलाथŎकीओरसे/ Appellant by : Shri Anurag Sinha, Adv.– Ld. AR ŮȑथŎकीओरसे/Respondent by : Shri Shailendra Shrivastava – Ld. Sr. DR सुनवाईकीतारीख/Date of Hearing : 10-02-2025 घोषणाकीतारीख /Date of Pronouncement : 28-03-2025 आदेश / O R D E R Manoj Kumar Aggarwal (Accountant Member) 1. Aforesaid appeal by assessee for Assessment Year (AY) 2017-18 arises out of an order of learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi [CIT(A)] dated 05-12-2022 in the matter of an assessment framed by Ld. Assessing Officer [AO] u/s. 143(3) of the Act on 29-12-2019. The sole grievance of the assessee is confirmation of addition of cash deposit for Rs.49.87 Lacs. Having heard vehement arguments of both the sides, the appeal is disposed-off as under. 2. The assessee is stated to be engaged in trading of jewellery. The assessee made cash sales of Rs.73.50 Lacs during October, 2016 and cash sales of Rs.11.06 Lacs during 01-11-2016 to 08-11-2016. The same was utilized to make deposits in its bank accounts. The Ld. AO alleged that the assessee artificially inflated the cash-in-hand. The sales during this period were abnormal in comparison to earlier years. The sales in October, 2016 could be twice that of cash sale of September, 2016. Accordingly, alleged excess cash sales of Rs.49.87 Lacs were added to the income of the assessee. 3. During appellate proceedings, the assessee stated that it maintained proper books of accounts and the books were duly audited. The deposits were made out of cash balance as available in the cash book. The assessee filed VAT returns reflecting sales made by it during October, 2016. However, Ld. AO, going by statistical trends, upheld the impugned addition against which the assessee is in further appeal before us. 4. It is quite clear from the facts that the assessee has maintained proper books of accounts and the books were duly audited. The deposits were made out of cash balance as available in the cash book. The assessee filed VAT returns reflecting sales made by it during October, 2016. The books have not been rejected and no single defect has been pointed out in the same. The impugned addition is based on mere statistical inferences. Considering the facts of the case and to plug any possible leakage of revenue, we would hold that lump sum addition of Rs.5 Lacs would meet the end of justice. The same would be assessable as normal business income only. We order so. The Ld. AO is directed to re-compute the income of the assessee. 5. The appeal stand partly allowed. Order pronounced u/r 34(4) of Income Tax (Appellate Tribunal) Rules, 1963. Sd/- Sd/- (SATBEER SINGH GODARA) (MANOJ KUMAR AGGARWAL) Ɋाियक सद˟ /JUDICIAL MEMBER लेखा सद˟ /ACCOUNTANT MEMBER Dated: 28-03-2025 आदेश की Ůितिलिप अŤेिषत / Copy of the Order forwarded to : 1. अपीलाथŎ/Appellant 2. ŮȑथŎ/Respondent 3. आयकरआयुƅ/CIT 4. िवभागीयŮितिनिध/DR 5. गाडŊफाईल/GF ASSISTANT REGISTRAR ITAT AGRA "