Income Tax Offier, Ward 28(4), New Delhi Vs Shri Jagdish Kakker, Flat No. E-501, Raj Hans Apptt., Ahinsa Khand, Part-1, Indrapuram, Distt. Ghaziabad
July, 30th 2014
IN THE INCOME TAX APPELLATE TRIBUNAL
DELHI BENCH `D', NEW DELHI
Before Sh. George George K., JM And Sh. B. C. Meena, AM
ITA No. 4126/Del/2012 : Asstt. Year : 2008-09
Income Tax Offier, Ward 28(4), Vs Shri Jagdish Kakker,
New Delhi Flat No. E-501, Raj Hans Apptt.,
Ahinsa Khand, Part-1, Indrapuram,
PAN No. ANVPK4259M
Assessee by : Sh. R. B. Arora, Adv.
Revenue by : Sh. S. N. Bhatia, DR
Date of Hearing : 24.7.2014 Date of Pronouncement : 25.7.2014
Per George George K., JM:
This appeal at the instance of department is directed against CIT(A)
order dated 16.5.2012. The relevant assessment year is 2008-09.
2. The grounds raised read as follows:-
"1. On the basis of facts and circumstances of the case and in law the Ld.
CIT(A) has erred in admitting the additional evidence without giving any
opportunity to the A.O.
2. On the basis of facts and circumstances of the case and in law the Ld.
CIT(A) has erred in deleting the addition of Rs. Rs. 13,48,700/- out of the
total addition of Rs. 14,48,700/- made by the A.O on account of income
from undisclosed sources".
2 ITA No. 4126/Del/2012
3. Brief facts of the case are as under:
The assessee is an individual. He was engaged in sanitary and
hardware business during the relevant assessment year. The Assessing
Officer had received A.I.R information that the assessee had incurred
credit card expenditure amounting to Rs. 14,48,700/- (ABN Amro Bank
credit card). The assessee was asked to explain the said expenditure and in
absence of a reply the same was added u/s 69 of the Act as undisclosed
4. Aggrieved by the said addition the assessee filed an appeal before the
CIT(A). Before the First Appellate Authority, it was submitted that the
assessee had only minor business transactions and did not incur the huge
expenditure of 14,48,700/- as credit card expenses. It was submitted that
the assessee is a small time businessman and the business has been since
closed and he is now working as a salaried employee. The CIT(A) allowed
the appeal of the assessee. The findings of the CIT(A) reads as follows:-
"3.3 I have considered the order of the A.O and the submissions of the
assessee and I find some merit in the submission of the assessee that the
A.O has not colleted any evidence to show that the assessee had incurred
the expenditure of Rs. 14,48,700/- through his credit card and as such
there is no justification for making addition under the head credit card
expenditure. However, it is seen that the A.O had actually received the
AIR information which was actually regarding the cash
deposits/transactions of Rs. 14,48,700/- through ABN Amro Bank which
the A.O mistakenly took as expenditure under the head credit card.
Further, it is seen that the assessee is having a bank account with ABN
Amro Bank account in which there was a cash deposit of Rs. 14,53,700/-
but it is also seen that the cash deposits are of smaller amounts and on
various dates and there are large numbers of transactions of cash
3 ITA No. 4126/Del/2012
deposits and withdrawals. It is also seen that the total deposits in this
bank account is of Rs. 21,72,616/- which includes the cash deposits of Rs.
14,53,700/- on various dates. It is also seen that although the closing
peak balance in the bank account is average Rs. 25,000/- to Rs. 50,000/-
but there are various closing peak balance above Rs. 50,000/- also and
the maximum closing balance is of Rs. 1,04,174/- on 12/10/2007.
3.4 After considering all the facts and circumstances of the case and after
taking a holistic view particularly the fact that the assessee was a small
time businessman having very small turnover, I am of the view that the
ends of justice will be met if a lump sum estimated addition of Rs.
1,00,000/- is confirmed considering the closing balance peak credit and
various cash deposits and other unexplained income and accordingly, the
addition to the extent of Rs. 1,00,000/- is confirmed and the balance
addition of Rs. 13,48,700/- (Rs. 14,48,700/- (-) Rs. 1,00,000/-) is
5. The Revenue being aggrieved is an appeal before us. The ld. DR
submitted that the CIT(A) has erred in deleting the addition of 13,48,700/-
out of the total addition of Rs. 14,48,700/- made by the Assessing Officer.
It was submitted that the CIT(A) has admitted additional evidence and has
not given sufficient opportunity to the Assessing Officer to examine the
6. The ld. AR, on the other hand, submitted that no fresh evidence was
produced before the First Appellate Authority. It was submitted that the
A.I.R information that was received by the department was with reference
to cash deposits in Royal Bank of Scotland (the name changed from ABN
Amro Bank) and the department had made a mistake in taking deposits of
sale proceeds as expenditure for credit card payments.
4 ITA No. 4126/Del/2012
7. We have heard rival submissions and perused the material on record.
The Assessing Officer could have easily realized that there was a prima
facie mistake on the part of the Revenue to process the information
received through the A.I.R. The A.I.R information was actually regarding
the cash deposits of Rs. 14,48,700/- through ABN Amro Bank. We have
perused the bank statement of the ABN Amro Bank which is placed at
pages 14 to 26 of the paper book filed by the assessee. It is seen that the
cash deposits are small amounts on various dates. There is also cash
withdrawal. The assessee's claim is that cash deposits are out of sale
proceeds received in cash and cash withdrawal are for making purchases
from wholesalers and small manufactures. The Assessing Officer without
verify the matter proceeded to make an addition u/s 69 of the Act. The
CIT(A) has correctly analyzed the issue in question and reduced the
addition from Rs. 14,48,700/- to Rs. 1,00,000/-. The CIT(A) finding has
not been controverted/dispelled by the Revenue. Therefore, we see no
reason to interfere with the CIT(A) and we uphold the same. It is order
8. In the result, the appeal of the Revenue is dismissed.
Order pronounced in the open Court on 25/7/2014
(B. C. Meena) (George George K.)
ACCOUNTANT MEMBER JUDICIAL MEMBER
5 ITA No. 4126/Del/2012
Copy forwarded to:
1. Draft dictated on 24.7.2014 PS
2. Draft placed before author 24.7.2014 PS
3. Draft proposed & placed before the JM/AM
4. Draft discussed/approved by Second JM/AM
5. Approved Draft comes to the Sr.PS/PS PS/PS
6. Kept for pronouncement on PS
7. File sent to the Bench Clerk PS
8. Date on which file goes to the AR
9. Date on which file goes to the Head Clerk.
10. Date of dispatch of Order.