The ITO, Ward-10(3),, Ahmedabad v. Shri Mayurbhai Suryakant Shah, Ahmedabad

ITA 2236/AHD/2005 | 2002-2003
Pronouncement Date: 05-03-2010 | Result: Dismissed

Appeal Details

RSA Number 223620514 RSA 2005
Bench Ahmedabad
Appeal Number ITA 2236/AHD/2005
Duration Of Justice 4 year(s) 4 month(s) 12 day(s)
Appellant The ITO, Ward-10(3),, Ahmedabad
Respondent Shri Mayurbhai Suryakant Shah, Ahmedabad
Appeal Type Income Tax Appeal
Pronouncement Date 05-03-2010
Appeal Filed By Department
Order Result Dismissed
Bench Allotted B
Tribunal Order Date 05-03-2010
Date Of Final Hearing 04-03-2010
Next Hearing Date 04-03-2010
Assessment Year 2002-2003
Appeal Filed On 24-10-2005
Judgment Text
- 1 - IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCH B AHMEDABAD BEFORE S/SHRI MAHAVIR SINGH JM AND D.C.AGRAWAL AM MAYUR SURYAKANT SHAH 4 SUMANGALAM SOCIETY OPP. MEMNAGAR FIRE STATION NAVRANGPURA AHMEDABAD V/S. INCOME-TAX OFFICER WARD 10(3) AHMEDABAD (APPELLANT) (RESPONDENT) AND INCOME-TAX OFFICER WARD 10(3) AHMEDABAD V/S. MAYUR SURYAKANT SHAH 4 SUMANGALAM SOCIETY OPP. MEMNAGAR FIRE STATION NAVRANGPURA AHMEDABAD (APPELLANT) (RESPONDENT) ASSESSEE BY :- SHRI S.N.SOPARKAR & SHRI TUSHAR HEMANI ARS REVENUE BY:- SHRI V.C. MODI ADDL.CIT DR O R D E R PER D.C.AGRAWAL ACCOUNTANT MEMBER . THESE ARE CROSS APPEALS ONE FILED BY THE REVENUE AND THE OTHER FILED BY THE REVENUE ARISING FROM THE ORDER OF LD. CIT(A) DATED ITA NO.2224/AHD/2005 ASST. YEAR :2002-03 ITA NO.2236/AHD/2005 ASST. YEAR :2002-03 2 24.8.2005. SINCE THEY INVOLVE COMMON ISSUES THEY AR E TAKEN UP TOGETHER FOR THE SAKE OF CONVENIENCE. 2. IN ASSESSEES APPEAL FOLLOWING GROUNDS ARE RAISE D :- (1) THAT THE LD. CIT(A) HAS ERRED IN CONFIRMING THA T THE FOLLOWING DEPOSITS OF RS.7 25 000/- ARE NOT GENUINE AND HAS E RRED IN TREATING THE SAME AS APPELLANTS INCOME. HE HAS FURTHER ERRE D IN CONFIRMING DISALLOWANCE OF INTEREST OF RS.38 739/- PAID TO 2 D EPOSITORS. SL.N O. NAME OF THE DEPOSITOR AMOUNT (RS.) MODE OF RECEIPT (RS.) INTEREST (RS.) REMARKS 1. SURYAKANT A. SHAH 6 20 000 CHEQUE 38 364 DEPOSIT RECEIVED IN ASST. YEAR 2001-02 2. RINAL P. SHAH 15 000 CASH - - 3. KARAN P. SHAH 15 000 CASH - - 4. ASHOKBHAI K. CHAUHAN 10 000 CASH - - 5. SMT. KAILASHBEN N. SHAH 15 000 CASH - - 6. TIRTH J. SHAH 10 000 CASH - - 7. DEEPAL V. SHAH 15 000 CASH - - 8. DEVANG K. SHAH 25 000 CASH 375 DEPOSIT RECEIVED BY CHEQUE NOT CASH RS. 7 25 000 38 739 (2) (A) THAT THE VARIOUS REASONS ADVANCED BY THE CI T(A) IN CONFIRMING THE ADDITIONS OF RS.7 25 000/- AS INCOME AND CONFIRMING THE DISALLOWANCE OF INTEREST OF RS.38 73 9/- ARE CONTRARY TO THE FACTS OF THE CASE AND EVIDENCE ON RECORD. HE SHOULD HELD THE SAME AS GENUINE AND DELETED THE ADDITIONS OF RS.78 000/- AND INTEREST OF RS.38 739/-. (B) THAT THE APPELLANT OBJECTS TO THE CIT(A)S FIN DING THAT SURYAKANT A. SHAH HAD DEPOSITED RS.6 20 000/- BY CH EQUE DURING THE ASST. YEAR UNDER APPEAL WHEN IN FACT IT WAS REC EIVED IN PREVIOUS ASST.YEAR I.E. 2001-02. HE HAS THEREFORE WRONGLY CO NFIRMED THE ADDITION OF RS.6 20 000/- AND DISALLOWANCE OF INTER EST OF RS.38 364/- 3 (C) THAT THE APPELLANT OBJECTS TO THE CIT(A)S FIN DING THAT DEVANG K. SHAH HAD DEPOSITED RS.25 000/- IN CASH WH EN IN FACT THE DEPOSITORS FATHER KAMLESH B. SHAH HAD DEPOSITED RS .25 000/- IN THE NAME OF HIS SON DEVANG BY CHEQUE DRAWN ON CORPO RATION BANK. HE HAS THEREFORE WRONGLY CONFIRMED THE ADDITI ON OF RS.25 000/- AND DISALLOWANCE OF INTEREST OF RS.375/ -. (3) THAT THE CIT(A) HAS ERRED IN CONFIRMING THE DIS ALLOWANCE OF TELEPHONE EXPENSES OF RS.5 000/- WHEN ON THE FACTS OF THE CASE NOTHING SHOULD BE DISALLOWED. 3. WHEREAS IN REVENUES APPEAL FOLLOWING GROUNDS AR E RAISED :- (1) THE LD. CIT(A) HAS ERRED IN LAW AND ON FACT IN DIRE CTING TO DELETE THE ADDITION OF RS.7 31 357/- MADE U/S 68 OF THE IT ACT. (2) THE LD. CIT(A) FURTHER ERRED IN LAW AND ON FACTS IN DIRECTING TO DELETE THE DISALLOWANCE OF INTEREST OF RS.82 500/- (3) FROM THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE LD. CIT(A) OUGHT TO HAVE UPHOLD THE ORDER OF THE AO. 4. THE FACTS OF THE CASE ARE THAT ASSESSEE AN INDIV IDUAL IS ENGAGED IN THE BUSINESS OF XEROX COPYING PRINTOUT SPIRAL BIN DING. STD PCO. DURING THE COURSE OF ASSESSMENT PROCEEDINGS AO NOTI CED FOLLOWING CREDITS IN ITS BOOKS :- SL.NO. NAME OF THE APPELLANT AMT. OF DEPOSIT MODE OF DEPOSIT 1. JASUMATIBEN V. BAROT 3 00 000 CHEQUE 2. PARAG A. SHAH C.A. 1 81 357 CHEQUE 3 NIRALI B. BHRAHMBHATT 2 50 000 CHEQUE 4 SURYAKANT A. SHAH 6 20 000 CHEQUE 5 RINAL P. SHAH 15 000 CASH 6 KARAN P. SHAH 15 000 CASH 7 ADHOKBHAI K. CHAUHAN 10 000 CASH 8 KAILASHBEN N. SHAH 15 000 CASH 9 TIRTH J. SHAH 10 000 CASH 10 DEEPAL V. SHAH 15 000 CASH 11 DEVANG K. SHAH 25 000 CASH 4 IN RESPECT OF ABOVE PARTIES THE AO NOTED FOLLOWING DEFICIENCIES :- SL.N O. NAME OF THE DEPOSITOR DEFECT 1 JASUMATIBEN V. BAROT NO ADDRESS GIVEN. CONFIRMATI ON IS FROM OTHER PARTY I.E. V.J.BAROT WITH THE REMARKS THAT UNDER POWER OF ATTORNEY BUT NO POWER ATTORNEY CERTIFICATE WAS FI LED. FURTHER SOURCE OF INCOME AND IDENTITY OF THE PARTY WAS NOT PROVED. PAN GIVEN BUT ON VERIFICATION IT WAS NO TICED THAT THE SAME PERTAINED TO ANOTHER PARTY. 2 PARAG A. SHAH PAN NOT GIVEN SO ALSO THE IDENTITY AND CREDIT WORTHINESS WAS NOT PROVED. THE SOURCE OF INCOME WAS ALSO NOT EXPLAINED WITH SUPPORTING EVIDENCE. 3 NIRALI B. BRAHMBHATT IDENTITY AND CREDIT WORTHINE SS WAS NOT PROVED AND THE SOURCE IF INCOME WAS ALSO NOT EXPLAINED WITH SUPPOR TING EVIDENCE. ONLY CHEQUE NUMBER WAS GIVEN WHICH WILL NOT ESTABLISH THAT THE PARTY HAS CAPACITY AND THE M ONEY SHOWN ACTUALLY BELONGS TO HER AND OUT OF HER OWN INCOME. 4 SURYAKANT A. SHAH COPY OF BANK STATEMENT FURNISHE D REVEALED THAT A SUM OF RS.6 40 000 WAS TRANSFERRED ON 1.2.2001 PERTAINED T O ASST. YEAR 2001-02 AND THE ACCOUNT FILED BY THE ASS ESSEE SHOWED THAT THE AMOUNT HAD BEEN RECEIVED BY DIFFERE NT CHEQUES ON THE SAME DAY I.E. 19.9.2001 5 RINAL P. SHAH COMPLETE ADDRESS & PAN IS NOT GIVEN 6 KARAN P. SHAH PAN IS NOT GIVEN IDENTITY IS NOT P ROVED AND ALSO CREDITWORTHINESS/SOURCE OF INCOME IS NOT ESTABLISHE D. 7 ASHOKBHAI K. CHAUHAN PAN AND ADDRESS IS NOT GIVEN; IDENTITY IS NOT PROVE D AND ALSO CREDITWORTHINESS/SOURCE OF INCOME IS NOT ESTABLISHED. 8 KAILASHBEN N. SHAH PAN IS NOT GIVEN; IDENTITY IS NOT PROVED AND ALSO CREDITWORTHINESS/SOURCE OF INCOME IS NOT ESTABLISHE D. 9 TIRTH J. SHAH PAN IS NOT GIVE; IDENTITY IS NOT PR OVED AND ALSO CREDITWORTHINESS/SOURCE OF INCOME IS NOT ESTABLISHE D. 10 DEEPAL V. SHAH PAN AND COMPLETE ADDRESS IS NOT G IVEN; IDENTITY IS NOT PROVED AND ALSO CREDITWORTHINESS/SOURCE OF INCOME I S NOT ESTABLISH. 11 DEVANG K. SHAH PAN IS NOT GIVEN; IDENTITY IS NOT PROVED AND ALSO CREDITWORTHINESS/SOURCE OF INCOME IS NOT ESTABLISHE D. THUS HAVING NOT SATISFIED WITH THE CREDITS THE AO MADE ADDITION OF RS.14 56 356 AND ALSO DISALLOWED PROPORTIONATE INTE REST. THE LD. CIT(A) DELETED THE ADDITION IN RESPECT OF JASUMATI V. BARO T PARAG A. SHAH AND NIRALI B. BRAHMBHATT TOTALING TO RS.7 31 357/-. IN THIS REGARD HIS OBSERVATIONS IN RESPECT OF THE FIRST THREE CREDITOR S ARE AS UNDER :- 5 2.2.1 IN RESPECT OF SMT. JASUMATIBEN V. BAROT GIVE N AT SR. NO.1 ABOVE IT IS SEEN THAT PAN IDENTITY HAS BEEN FILED. COPIES OF THE RETURNS ALONG WITH HER BANK ACCOUNT HAVE BEEN FILED ON RECO RD AND HAD ACCORDINGLY ADVANCED AN AMOUNT OF RS. 3 LAKHS BY C HEQUE TO THE APPELLANT. 2.2.2 IN RESPECT OF SHRI PARAG A. SHAH WHO IS A C .A. HIS COPY OF RETURN HAS BEEN FILED ON RECORD AND IT IS SEEN THAT HE HAD ADVANCED AN AMOUNT OF RS.1 81 357/- BY CHEQUE TO THE APPELLANT. 2.2.3 IN RESPECT OF SR.NO.3 NIRALI B. BRAHMBHATT HER PAN IDENTITY HAS BEEN FILED ON RECORD ALONGWITH A COPY OF HER RETURN OF INCOME AND ALSO A COPY OF HER BANK ACCOUNT. IT IS SEEN THAT SH E HAS ADVANCED AN AMOUNT OF RS.2 50 000/- BY CHEQUE TO THE APPELLA NT. ACCORDINGLY HE DELETED THE ADDITION. 5. IN RESPECT OF SURYAKANT A. SHAH LD. CIT(A) NOTIC ED THAT A SUM OF RS.6 20 000/- WAS WITHDRAWN BY THE DEPOSITOR FROM O NE S.A. SHAHS ACCOUNT FROM PADMAVATI XEROX AND TRANSFERRED TO ASS ESSEES PERSONAL ACCOUNT ON 19.9.2001 I.E. THE SAME DAY. THUS THE DE POSIT ACCOUNT WAS CLOSED IN PADMAVATI XEROX BOOKS AND DEPOSIT ACCOUN T WAS OPENED IN THE NAME OF SHRI MAYUR S. SHAH. THUS THERE WAS A DEBIT AND CREDIT ON THE SAME DAY. IN RESPECT OF OTHERS LD. CIT(A) HELD THA T DETAILS OF THE CREDITORS ARE NOT KNOWN. MONEY IS DEPOSITED IN CASH WITH THE ASSESSEE AND THEREFORE CREDITS ARE NOT ACCEPTABLE. HE ACCORDING LY CONFIRMED THE ADDITION IN RESPECT OF CREDITORS AT SL.NO.S. 4 TO 1 1. THE ASSESSEE IS IN APPEAL AGAINST THE CONFIRMATIONS OF ADDITIONS IN RE SPECT OF CREDITORS AT SL.NO.4 TO 11 WHEREAS THE DEPARTMENT IS IN APPEAL I N RESPECT OF CREDITORS AT SL.NO.1 TO 3. 6. WE HAVE HEARD THE PARTIES AND PERUSED THE MATERI AL ON RECORD. REGARDING CREDITORS AT 1 2 & 3 WE NOTICE THAT DETA ILS OF PAN AND 6 ASSESSMENTS HAVE BEEN FILED THE CREDITORS ARE ASSE SSED TO TAX. MONEY HAS BEEN TRANSFERRED THROUGH BANKING CHANNELS AND THERE IS NO ADVERSE FINDING THAT CREDIT WORTHINESS OF THESE CREDITORS IS IN DOU BT OR THAT MONEY WAS DEPOSITED IN CASH AND SUBSEQUENTLY TRANSFERRED TO T HE ACCOUNT OF THE ASSESSEE. ONCE ASSESSEE HAS DISCHARGED THE ONUS BY GIVING BASIC DETAILS OF IDENTITY AND CREDITWORTHINESS AND THERE IS NOTHING ON RECORD TO DOUBT THE GENUINENESS OF TRANSACTION THEN ADDITION BY TREATIN G THE CREDITS AS NON- GENUINE CANNOT BE UPHELD. ACCORDINGLY WE CONFIRM T HE ORDER OF LD. CIT(A) IN DELETING THE ADDITION IN RESPECT OF THREE CREDITORS. 7. IN RESPECT OF CREDITS IN THE NAME OF SURYAKANT A . SHAH FOR A SUM OF RS.6 20 000/- LD. AR FOR THE ASSESSEE POINTED OUT T HAT NO MONEY WAS RECEIVED THIS YEAR. HE DREW OUR ATTENTION TO PAGE 1 2 OF THE PAPER BOOK WHICH IS THE ACCOUNT OF SHRI SURYAKANT A. SHAH IN T HE BOOKS OF PADMAVATI XEROX THE PROPRIETARY CONCERN OF THE ASSESSEE WHIC H SHOWS THAT OPENING CREDIT IN THE ACCOUNT OF SHRI SURYAKANT A. SHAH WAS RS.6 06 973/- AS ON 1.4.2001 AND WHAT WAS DONE ON 19.9.2001 WAS THE WIT HDRAWAL OF MONEY BY SHRI SURYAKANT A. SHAH FROM PADMAVATI XEROX AND NOT ANY DEPOSIT OF MONEY BY HIM WITH THE ASSESSEE. ONCE NO MONEY HAD C OME AFRESH THIS YEAR FROM SURYAKANT A. SHAH THEN QUESTION OF TREAT ING THE CREDITS AS ARISING THIS YEAR AND ACCORDINGLY BECOMING TAXABLE THIS YEAR DOES NOT ARISE. THERE SEEMS TO BE CERTAIN CONFUSION WHEREBY AUTHORITIES HAVE THOUGHT THAT SUM OF RS.6 20 000/- HAS BEEN RECEIVED BY THE ASSESSEE DURING THIS YEAR. IN FACT IT IS A DEBIT ENTRY IN TH E ACCOUNT OF SHRI SURYAKANT A. SHAH AND THEREFORE NOT LIABLE TO BE CONSIDERED UNDER SECTION 68. ACCORDINGLY THIS ADDITION HAVING BEEN MADE UNDER WR ONG PREMISES IS HEREBY DELETED. 7 8. REGARDING CREDITS AT ITEM NOS.5 TO 10 WE CONFIRM THE ORDER OF LD. CIT(A) FOR THE REASONS THAT MONEY IS DEPOSITED IN C ASH IDENTITY OF THE CREDITOR IS NOT ESTABLISHED AND ALSO THE GENUINENES S OF THE TRANSACTIONS AND CREDITWORTHINESS OF THE CREDITORS IS ALSO NOT E STABLISHED. THEREFORE THIS PART OF THE GROUND OF APPEAL OF ASSESSEE IS RE JECTED. 9. REGARDING CREDIT IN THE NAME OF DEVANG K. SHAH L D. AR POINTED OUT THAT HIS MONEY IS RECEIVED BY CHEQUE IDENTITY OF DEVANG K. SHAH IS KNOWN AND BY MISCONCEPTION IT HAS BEEN WRITTEN THAT AMOUNT WAS RECEIVED BY CASH. LD. AR DREW OUR ATTENTION TO PAGE 26 OF THE PAPER BOOK WHICH IS THE COPY OF BANK ACCOUNT OF SHRI DEVANG K. SHAH WHICH SHOWS THAT A SUM OF RS.25 000/- IS WITHDRAWN BY CHEQUE NO .981416 AND REMITTED TO MAYUR S. SHAH I.E. THE ASSESSEE. THUS H AVING KNOWN THE IDENTITY OF THE CREDITOR AND TRANSACTION BEING THRO UGH BANKING CHANNEL THE ADDITION SO SUSTAINED BY THE LD. CIT(A) ON THIS ACCOUNT IS DELETED. 10. THE DISALLOWANCE OF INTEREST IS ACCORDINGLY PRO PORTIONATELY DELETED. THE AO WILL RETAIN THE DISALLOWANCE OF INTEREST TO THE EXTENT CREDIT IS DISALLOWED. 11. AS A RESULT APPEAL FILED BY THE REVENUE IS DIS MISSED WHEREAS THE APPEAL FILED BY THE ASSESSEE IS PARTLY ALLOWED. SD/- SD/- (MAHAVIR SINGH) (D.C.AGRAWAL) JUDICIAL MEMBER ACCOUNTANT MEMBER AHMEDABAD DATED : 5/3/2010 ORDER PRONOUNCED IN OPEN COURT ON 5/3/2010 8 MAHATA/- COPY OF THE ORDER FORWARDED TO :- 1. THE APPELLANT. 2. THE RESPONDENT. 3. THE CIT(APPEALS)- 4. THE CIT CONCERNS. 5. THE DR ITAT AHMEDABAD 6. GUARD FILE. BY ORDER DEPUTY / ASSTT.REGISTRAR ITAT AHMEDABAD