SHRI ATUL N.PATEL,AHMEDABAD V. THE DY.CIT., CIRCLE-7, AHMEDABAD

MA 136/AHD/2024

AI Insights

This case involves a Miscellaneous Application filed by Shri Atul N. Patel against the order of the Income Tax Appellate Tribunal, Ahmedabad, which confirmed various additions to the assessee's income for the Assessment Years 1995-96 to 1997-98. The additions were based on unexplained cash credits and other income items reflected in seized documents. The assessee contested the Tribunal's decision, arguing that there were clerical errors in the figures stated and that the Tribunal failed to consider the telescoping of additions with the negative cash balance. The Tribunal acknowledged the clerical error and corrected it but did not accept the broader request for deletion of other additions, emphasizing that such a request would constitute a review of the order rather than a correction of a mistake.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 34376 (ITAT-AHMEDABAD)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 31-12-2024
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: D
• Assessment Year: misc
• Laws Referred To: Income Tax Act
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: B.P. SRIVASTAVA
• Assessee Lawyers: S.N. DIVATIA
• Keywords: Unexplained cash credit; Document seized; Documents seized
• Section: 48; 13

Judgement Text

"M.A. No.136/Ahd/2024 (In IT(SS)A No.69/Ahd/2010 A.Y./Block Period: 01.04.1986 to 01.08.1996 Shri Atul N. Patel vs. DCIT Page 1 of 4 IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD “D” BENCH, AHMEDABAD BEFORE Ms. SUCHITRA KAMBLE, JUDICIAL MEMBER AND SHRI NARENDRA PRASAD SINHA, ACCOUNTANT MEMBER M.A. No.136/Ahd/2024 (In IT(SS)A No.69/Ahd/2010) A.Y./Block Period: 01.04.1986 to 01.08.1996) Shri Atul N. Patel, 404, Sahajanand Complex, Nr. Saptak Party Plot, 132 Ft. Ring Road, Naranpura, Ahmedabad. [PAN – ACPA 9796 R] Vs. The DCIT, Circle – 7, Ahmedabd. (Appellant) (Respondent) Assessee by Shri S.N. Divatia, AR Revenue by Shri B.P. Srivastava, Sr. DR Date of Hearing 20.12.2024 Date of Pronouncement 31.12.2024 O R D E R PER SUCHITRA KAMBLE, JUDICIAL MEMBER: This Miscellaneous Application is filed by the assessee to modify the order passed by this Tribunal in IT(SS)A No.69/Ahd/2010 dated 09.10.2024 for the A.Y./Block Period 01.04.2086 to 01.08.1996. 2. Shri S.N. Divatia, Ld. AR for the assessee explained that the Tribunal had confirmed various additions vide order dated 09.10.2024. In this regard, he has furnished the following chart : Sr. No. Particular/A.Y. 1995-96 1996-97 1997-98 As per ITAT 1 Unexplained cash credit (para 7.3) page 37 1,25,000 39,03,356 38,76,834 5% as Commission (para 13 page 17) M.A. No.136/Ahd/2024 (In IT(SS)A No.69/Ahd/2010 A.Y./Block Period: 01.04.1986 to 01.08.1996 Shri Atul N. Patel vs. DCIT Page 2 of 4 2 Unexplained cash credit (para 7.4 B) page 38 3,00,000 1,51,000 Rs.50,000 & Rs.1,51,000 deleted (para 14) 3 Profit on shares (para 7.5) 24,875 12,500 Confirmed (para 15) 4 Income reflected i in A/3 & A/4 (para 7.6) page 42 3,62,237 2,48,869 Confirmed (para 16) 5 ATIRA Interest A/c. (para 7.7A) page 44 5,83,770 6,76,243 Confirmed (para 17) 6 ATIRA CHD A/c. (para 7.7B) page 48 89,745 21,31,223 Confirmed (para 18) 7 Investment in ATIRA A/c. (para 8.3) page 53 35,25,000 21,75,000 Confirmed (para 19) 8 Negative Cash Balance (Para 9) 1,00,000 10,35,956 1,06,503 Confirmed (para 21) 3. The first mistake pointed out by the ld. AR is in paragraph no.21 of the order dated 09.10.2024. He explained that the figure of addition confirmed for A.Y. 1996-97 was wrongly mentioned as Rs.1,06,503/-. The Ld. AR submitted that the correct figure of addition was Rs.10,06,503/-. 4. The Ld. AR further submitted that the additions as confirmed above were in respect of seized documents A/3 & A/4. According to the Ld. AR, the confirmation of individual items of income as well as confirmation of addition for negative cash balance had resulted into double addition. According to the Ld. AR, the benefit of telescoping of the additions with the negative cash balance was not considered by the Tribunal which was a mistake apparent on record. The Ld. AR submitted that only addition for negative cash balancer should have been sustained and other additions should have been deleted. 5. Per contra, Shri S.P. Srivastava, Ld. DR submitted that the matter may be decided by the Tribunal after considering the mistakes in the order, if any. 6. We have considered the submissions of the Ld. AR. The mistake in the figure of addition for the negative cash balance for the Assessment Year 1996-97 as M.A. No.136/Ahd/2024 (In IT(SS)A No.69/Ahd/2010 A.Y./Block Period: 01.04.1986 to 01.08.1996 Shri Atul N. Patel vs. DCIT Page 3 of 4 mentioned in paragraph no.21 of the order is a mistake apparent from record which needs to be corrected. As regards contention of the assessee that the addition for only negative cash balance should be confirmed and the other additions should be deleted as all these figures were taken from the seized documents A/3 & A/4, only cannot be accepted as it would tantamount to review of the order and it is not in the nature of mistake apparent from the records. At the same time, there is a merit in the contention that the request for benefit of telescoping of the other additions with the addition for negative cash balance was erroneously not considered by us. This mistake is, therefore, rectified and the paragraph no.21 of the order dated 09.10.2024 may now be read as under :- “21. Negative cash balance (para-9 of Assessment Order). On the basis of ledger of unaccounted business marked as A-3 and A-4 the Special Auditor had prepared a cash flow statement while carrying out special Audit u/s.142(2A) of the Act. The Auditor had pointed out certain negative/deficiency in cash flow in respect of which assessee was required to submit his explanation. The deficiency as pointed by the Auditor is reproduced in para 9.4 of the assessment order. The highest cash deficiency was added on incremental basis and accordingly additions of Rs.1,00,000/- in A.Y. 1995- 96, Rs.10,35,956/- in A.Y. 1996-97 and Rs.10,06,503/- in A.Y. 1997-98 were made. In the course of present appeal as well, no explanation has been given by the assessee in respect of these negative cash balances. We, therefore, do not find any reason to interfere with the findings of the Special Auditor based on which the AO has made this addition. Accordingly, the additions made by the AO in respect of cash deficiency/negative cash balance as discussed in para 9 of the order is confirmed. However, the Assessing Officer should allow benefit of telescoping of addition in respect of negative cash balance with the other additions made in these years on the basis of the seized documents A/3 & A/4.” M.A. No.136/Ahd/2024 (In IT(SS)A No.69/Ahd/2010 A.Y./Block Period: 01.04.1986 to 01.08.1996 Shri Atul N. Patel vs. DCIT Page 4 of 4 7. In the result, the Miscellaneous Application filed by the assessee is partly allowed. Order pronounced in the open Court on this 31st December, 2024. Sd/- Sd/- (NARENDRA PRASAD SINHA) (SUCHITRA KAMBLE) Accountant Member Judicial Member Ahmedabad, the 31st December, 2024 PBN/* Copies to: (1) The appellant (2) The respondent (3) CIT (4) CIT(A) (5) Departmental Representative (6) Guard File By order UE COPY Assistant Registrar Income Tax Appellate Tribunal Ahmedabad benches, Ahmedabad "