SATYANARAYAN JAISWAL, SURGUJA,SURGUJA V. .INCOME TAX OFFICER-3, KORBA, KORBA

ITA 470/RPR/2024

AI Insights

The case involves Satyanarayan Jaiswal, who appealed against the order of the Commissioner of Income-Tax (Appeals), which confirmed the A.O's addition of Rs.10,82,500 as unexplained income under Section 69A of the Income-tax Act, 1961. The A.O had initially treated the cash deposits in Jaiswal's bank account as unexplained income due to his failure to file a return or provide an explanation for the source of these deposits. The CIT(Appeals) upheld this decision, noting the lack of evidence supporting Jaiswal's claim that the deposits were from his agricultural business. The Tribunal, however, found merit in Jaiswal's argument and directed a re-examination of the evidence.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 35786 (ITAT-RAIPUR)
• Duration Of Justice: 1 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-12-2024
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2011-2012
• Appeal Filed On: 28-10-2024
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: PRIYANKA PATEL
• Assessee Lawyers: G.S. AGRAWAL
• Keywords: Opportunity of being heard; Corroborative evidences; FORM 26AS
• Section: 144; 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. 470/RPR/2024 Ǔनधा[रण वष[ / Assessment Year : 2011-12 Satyanarayan Jaiswal Ward No.10, Tayarband Para, Wadrafnagar, Dist. Sarguja (C.G.)-497 225 PAN : AREPJ7243D .......अपीलाथȸ / Appellant बनाम / V/s. The Income Tax Officer-3, Korba (C.G.) ……Ĥ×यथȸ / Respondent Assessee by : Shri G.S. Agrawal, CA Revenue by : Dr. Priyanka Patel, Sr. DR सुनवाई कȧ तारȣख / Date of Hearing : 28.11.2024 घोषणा कȧ तारȣख / Date of Pronouncement : 09.12.2024 2 Satyanarayan Jaiswal Vs. ITO-3, Korba ITA No. 470/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 29.08.2024, which in turn arises from the order passed by the A.O under Sec. 144 r.w.s.147 of the Income-tax Act, 1961 (in short ‘the Act’) dated 09.12.2018 for the assessment year 2011-12. The assessee has assailed the impugned order on the following grounds of appeal: “1. That under the facts and the law, the Ld. Commissioner of Income Tax (Appeals) erred in confirming the order passed by the Ld.AO u/s.144 r.w. 147, prayed that proceeding u/s.147/148 is not according to law, is based on borrowed opinion without applying mind by the Ld. AO on the basis of information received and lack of proper approval from senior authority in reopening the case u/s 148. Prayed to annul Assessment Order. 2. That under the facts and the law, the Ld. Commissioner of Income Tax (Appeals) further erred in confirming the addition of Rs.10,82,500/- made by the Ld. AO, rejecting the explanation that the above deposit is out of trading receipt for sale of agriculture produce made by the appellant. Prayed to delete the addition of Rs.10,82,500/-.” 2. Succinctly stated, the A.O based on information that though the assessee had during the subject year made cash deposits of Rs.10,82,500/- in his bank account but had not filed his return of income, initiated proceedings u/s.147 of the Act. 3 Satyanarayan Jaiswal Vs. ITO-3, Korba ITA No. 470/RPR/2024 3. As the assessee had despite sufficient opportunity failed to participate in the assessment proceedings and provide an explanation as regards the source of the subject cash deposits, therefore, the A.O vide his order passed u/s. 144/147 of the Act, dated 09.12.2018 after treating the entire amount of cash deposits of Rs.10,82,500/- as having been sourced out of the assessee’s unexplained income u/s. 69A of the Act, made an addition of the same. 4. Aggrieved, the assessee carried the matter in appeal before the CIT(Appeals) but without success. For the sake of clarity, the observations of the CIT(Appeals) are culled out as under: “5. Discussion and Decision 5.1 I have perused all the facts available in the file and submission made by the appellant, during the course of appellate proceedings. i) The first ground of appeal is general in nature and does not require any adjudication. ii) The second ground of appeal relates to addition made on account of cash deposit in saving bank account to the tune of Rs.10,82,500/-. I have carefully considered the assessment order. In absence of any explanation and supporting documentary evidences during the course of assessment proceedings, the AO completed the assessment u/s. 144 of the Act and made an addition of Rs.10,82,500/- on account of unexplained cash deposit u/s. 69A of the Act and computed the total income of the assessee at Rs.10,82,500/-. During the course of appellate proceedings, the appellant has submitted written submission where he has stated that he basically purchased agriculture produce from farmers from different locations of District Surguja: C.G and after collecting, he 4 Satyanarayan Jaiswal Vs. ITO-3, Korba ITA No. 470/RPR/2024 sold it to Tara Traders, Prop.: Anil Jaiswal, Hariharganj, C.G who paid sales bills amount in cash directly in appellant's bank account from SBI branch, Hariharganj, C.G. The appellant has given following/ various supporting documents in this office:- 1. Bank statement of A/c no. 11379442460 used for retail business transaction. 2. Form 26AS for AY 2011-12 3. Copy of ledger of debtor Shri Anil Jaiswal, Proprietor of Tara Trader for details of sales made during the FY 2010-11 relevant to AY 2011-12. 4. Copy of cashbook and bank ledger for FY 2010-11. 5. Copy of registration of Tara Traders with the Agricultural Products Marketing Committee, Aurangabad. I have carefully perused the submission made by the appellant and & rival contentions. The appellant has submitted that he is into the business activity. He purchases agricultural products from farmer from different locations of District Surguja, CG and sold the same to Tara Traders, Prop: Anil Jaiswal, Hariharganj, CG, who paid sales amount in cash into the appellant bank account from SBI Branch, Hariharganj, CG. However as seen from the bank statement nothing has been mentioned about the Tara Traders. No confirmations were submitted from the Tara Traders with regard to the sale of agricultural goods. The appellant could not submitted the details of agricultural goods sold to the Tara Traders. No documentary evidences were submitted to prove that Tara Traders directly credit the cash into the bank account of the appellant. The business activities conducted by the appellant in the previous years and subsequent years is not known. Hence the appellant arguments on the sources of cash deposit cannot be accepted. The addition on account of unexplained money u/s 69A is hereby upheld. In view of the above, this ground of appeal is dismissed.” 5. The assessee being aggrieved with the order of the CIT(Appeals) has carried the matter in appeal before the Tribunal. 5 Satyanarayan Jaiswal Vs. ITO-3, Korba ITA No. 470/RPR/2024 6. I have heard the Ld. Authorized Representatives of both the parties, perused the orders of the lower authorities and the material available on record, as well as considered the judicial pronouncements that have been pressed into service by the Ld. AR to drive home his contentions. 7. Shri G.S. Agrawal, Ld. Authorized Representative ( for short ‘AR’) for the assessee, at the threshold, submitted that both the lower authorities had grossly erred in law and facts of the case in treating the entire amount of cash deposits of Rs.10,82,500/- as the assessee’s unexplained money u/s. 69A of the Act. Elaborating on his contention, the Ld. AR submitted that the cash deposits made in the assessee’s bank account were sourced out of the cash sale proceeds of agricultural produce that were purchased by him from farmers located at different parts of the district i.e. Sarguja, Chhattisgarh and were sold to M/s, Tara Traders, proprietor Shri Anil Jaiswal, Hahiharganj. The Ld. AR in order to substantiate his aforesaid claim had taken me through the bank account of the assessee, Page 1 to 4 of APB, which revealed that primarily the cash deposits in question were made at Hariharganj. The Ld. AR had further taken me through the copy of the ledger account of M/s. Tara Traders as appearing in the books of account of the assessee, viz. Shri Satyanarayan Jaiswal, Page 36 to 44 of APB. On being queried as to whether the aforementioned copy of the ledger account of M/s. Tara Traders was available before the lower authorities, the Ld. AR submitted that the same was filed before the CIT(Appeals). The 6 Satyanarayan Jaiswal Vs. ITO-3, Korba ITA No. 470/RPR/2024 Ld. AR submitted that as the cash deposits made by the assessee in his bank account were the sale proceeds of agricultural produce, therefore, there was no justification on the part of the lower authorities in treating the same as the unexplained money of the assessee u/s. 69A of the Act. 8. Per contra, Dr. Priyanka Patel, Ld. Sr. Departmental Representative ( for short ‘DR’) at the threshold objected to the contentions raised by the assessee’s counsel. The Ld. DR submitted that as the assessee had failed to substantiate his claim based on supporting evidence that the subject cash deposits in his bank account during the year under consideration were sourced from the sale proceeds of agricultural produce to M/s. Tara Traders, therefore, no infirmity did emerge from the orders of the lower authorities who had rightly made/sustained the addition u/s. 69A of the Act. The Ld. Sr. DR to buttress her aforesaid contention had drawn my attention to the order of the CIT(Appeals)’s Para-4, wherein the latter had observed viz. (i) the assessee had not placed on record confirmation of the M/s. Tara Traders; (ii) the assessee had not produced the details of the agricultural produce which were sold to the aforesaid concern; (iii) no evidence was placed on record by the assessee which would evidence that the cash deposits in the bank account of the assessee was remittance of the sale proceeds by M/s. Tara Traders. Apart from that, the Ld. DR submitted that there was no material on record which would support the assessee’s claim that he was engaged in the business of trading of 7 Satyanarayan Jaiswal Vs. ITO-3, Korba ITA No. 470/RPR/2024 agricultural produce. The Ld. DR submitted that as the assessee had failed to discharge the onus that was cast upon him, therefore, the addition was rightly made/sustained by the lower authorities. 9. I have given thoughtful consideration to the contentions advanced by the Ld. Authorized Representatives of both the parties in the backdrop of the orders of the lower authorities. Admittedly, it is matter of fact borne from record that the assessee had in the course of proceedings before the lower authorities failed to discharge the onus that was cast upon him as regards explaining the “nature” and “source” of the cash deposits, made during the year under consideration in his bank account. As the assessee had failed to participate in the proceedings before the A.O, therefore, the latter was constrained to pass an ex-parte order u/s.144 of the Act, dated 09.12.2018. On appeal, the assessee had claimed before the CIT(Appeals) that the cash deposits in his bank account were sourced out of the sale proceeds of the agricultural produce to M/s. Tara Traders, Proprietor Shir Anil Jaiswal, Hariharganj, but the same was rejected by him for multi-facet reasons, viz. (i) the assessee had not placed on record confirmation of M/s. Tara Traders; (ii) the assessee had not produced the details of the agricultural produce which were sold to the aforesaid concern; (iii) no evidence was placed on record by the assessee which would evidence that the cash deposits in the bank account of the assessee was the remittance of the sale proceeds by M/s. Tara Traders. 8 Satyanarayan Jaiswal Vs. ITO-3, Korba ITA No. 470/RPR/2024 10. Although, I concur with the view taken by the CIT(Appeals) that the assessee had failed to substantiate his claim that the cash deposits in his bank account during the subject year were the sale proceeds which were directly remitted in his bank account by M/s. Tara Traders, but at the same time, I cannot remain oblivion of the fact that a careful scrutiny of the bank account of the assessee i.e. A/c. No.11379442460 with State Bank of India, Branch: Wadrafnagar reveals that primarily the cash deposits in question were made at Hariharganj. Considering the aforesaid material fact, I am of the view that the assessee’s claim that the cash deposits in question were sourced out of sale proceeds directly remitted by purchaser, viz. M/s. Tara Traders, Hahiharganj, cannot be summarily discarded. Accordingly, I am of the view that the matter in all fairness requires to be restored to the file of the A.O with a direction to re- adjudicate the same after carrying out necessary verification to his satisfaction. Needless to say, the A.O shall in the course of the set-aside proceedings afford a reasonable opportunity of being heard to the assessee who shall remain at liberty to substantiate his claim on the basis of fresh documentary evidence, if any. Thus, the Grounds of appeal No.1 and 2 raised by the assessee are allowed for statistical purposes in terms of the aforesaid observations. 9 Satyanarayan Jaiswal Vs. ITO-3, Korba ITA No. 470/RPR/2024 11. In the result, appeal of the assessee is allowed for statistical purposes in terms of the aforesaid observations. Order pronounced in open court on 09th day of December, 2024. Sd/- (रवीश सूद /RAVISH SOOD) ÛयाǓयक सदèय/JUDICIAL MEMBER रायपुर/ RAIPUR ; Ǒदनांक / Dated : 09th December, 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. "