Shri Sunderlal Raichand Shah, Vapi v. The Income tax Officer,Ward-3,, Vapi

ITA 3760/AHD/2008 | 2005-2006
Pronouncement Date: 26-02-2010 | Result: Dismissed

Appeal Details

RSA Number 376020514 RSA 2008
Assessee PAN AHPPS9336R
Bench Ahmedabad
Appeal Number ITA 3760/AHD/2008
Duration Of Justice 1 year(s) 3 month(s) 7 day(s)
Appellant Shri Sunderlal Raichand Shah, Vapi
Respondent The Income tax Officer,Ward-3,, Vapi
Appeal Type Income Tax Appeal
Pronouncement Date 26-02-2010
Appeal Filed By Assessee
Order Result Dismissed
Bench Allotted C
Tribunal Order Date 26-02-2010
Date Of Final Hearing 22-02-2010
Next Hearing Date 22-02-2010
Assessment Year 2005-2006
Appeal Filed On 18-11-2008
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCH 'C' (BEFORE S/SHRI N S SAINI AND MAHAVIR SINGH) ITA NO.3760/AHD/2008 (ASSESSMENT YEAR:- 2005-06) SHRI SUNDERLAL RAICHAND SHAH PROP. OF NIRMAN PHARMA 211 GIDC VAPI V/S THE INCOME-TAX OFFICER WARD-3 VAPI [APPELLANT] [RESPONDENT] APPELLANT BY :- SHRI RUPESH UPADHYAY RESPONDENT BY:- SHRI M C PANDIT SENIOR DR O R D E R PER N S SAINI (ACCOUNTANT MEMBER) : THIS APPEAL OF THE ASSESSEE IS FILED AGAINST THE ORDER OF THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) DATED 28-08-2008 ON THE SOLE GROUND THAT THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) HAS ERRED IN L AW AND ON FACTS IN CONFIRMING THE ADDITION OF RS.14 18 037/- MADE U /S 68 OF THE INCOME-TAX ACT 1961 BY THE LEARNED ASSESSING OFFIC ER. 2 THE BRIEF FACTS OF THE CASE ARE THAT DURING THE C OURSE OF ASSESSMENT PROCEEDINGS FROM THE VERIFICATION OF TH E CASH BOOK THE LEARNED ASSESSING OFFICER OBSERVED THAT THE ASSESSE E CARRIED A NEGATIVE CASH BALANCE. THE ASSESSEE WAS ISSUED A SH OW CAUSE NOTICE ON 07-12-2007 AND WAS ASKED TO EXPLAIN THE NEGATIVE CASH BALANCE OF RS.14 18 037/-. THE ASSESSEE VIDE LETTER DATED 03-1 2-2007 SUBMITTED THAT THE ASSESSEE HAS DEBITED RS.4 67 000/- AND RS. 3 50 000/- TOWARDS STAFF SALARY AND FACTORY EXPENSES. IT WAS S UBMITTED THAT IF THESE EXPENSES WOULD HAVE BEEN DEBITED REGULARLY / MONTHLY THE ISSUE UNDER DISPUTE WOULD NOT HAVE ARISEN. THE LEAR NED ASSESSING OFFICER IN ABSENCE OF ANY SATISFACTORY EXPLANATION BY THE ASSESSEE ADDED THE SUM OF RS.14 18 037/- TO THE INCOME OF TH E ASSESSEE. 2 3 IN APPEAL BEFORE THE LEARNED COMMISSIONER OF INCO ME-TAX (APPEALS) THE ASSESSEE EXPLAINED THAT THE NEGATIVE CASH BALANCE WAS COVERED UP FROM CASH LOANS TAKEN FROM HIS FAMILY ME MBERS WHOSE ENTRIES IN THE BOOKS ESCAPED TO BE RECORDED VIDE I TS LETTER DATED 29- 04-2008 AS UNDER:- PA NO. AMOUNT (1) SANDEEP S SHAH (HUF) AALH 9160 A 3 00 000 (2) SUNDERLAL R SHAH (INDL) AHPPS 9336 R 3 58 000 (3) SHRENIK SUNDERLAL SHAH (HUF) AANHS 5568 L 7 70 000 THE SUBMISSIONS OF THE ASSESSEE WERE FORWARDED TO T HE AO FOR HIS COMMENTS BY THE CIT(A). IN THE REMAND REPORT DATED 08-05-2008 THE AO OBSERVED THAT INSPITE OF ALLOWING ADEQUATE OPPOR TUNITIES TO THE ASSESSEE DURING THE ASSESSMENT PROCEEDINGS THE ASS ESSEE HAS NOT SUBMITTED ANY EXPLANATION FOR NEGATIVE CASH BALANCE IN HIS CASH BOOK. HE FURTHER SUBMITTED THAT THE BOOKS OF ACCOUN T ARE AUDITED AND IN THE REPORT IN FORM NO.3CB AND 3CD FILED WITH THE RETURN OF INCOME IN THE STATEMENT OF LOANS AND DEPOSITS TAKEN OR ACCEPTED AND REPAID AT POINT NO.24(A) AND (B) OF FORM NO.3CD THE ASSESSEE HAS STATED THAT IT HAS NOT ACCEPTED ANY CASH LOAN EXCEE DING THE LIMIT PRESCRIBED U/S 269SS AND REPAID ANY CASH LOAN EXCEE DING THE LIMIT PRESCRIBED U/S 269T OF THE ACT PARTICULARLY FROM T HE FAMILY MEMBERS. THE LEARNED ASSESSING OFFICER FURTHER SUBM ITTED THAT THE NEW EVIDENCES NOW FILED BEFORE THE LEARNED COMMISSI ONER OF INCOME-TAX (APPEALS) WERE AN AFTER-THOUGHT AND THE SAME SHOULD NOT BE ADMITTED. THE LEARNED ASSESSING OFFICER ALSO SUB MITTED THAT EVEN IF NEW EVIDENCES ARE CONSIDERED THEN WITHOUT ANY C ONFIRMATIONS FROM THE PERSONS THE ASSESSEE HAS RECEIVED CASH CRE DITS OUT OF BOOKS OF ACCOUNT AND REPAID THE SAME IN CASH VIOLATING TH E PROVISIONS OF SECTION 269SS AND 269T OF THE ACT. 3 4 THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) AFTER CONSIDERING THE REMAND REPORT AND THE SUBMISSIONS O F THE ASSESSEE HELD THAT THE ASSESSEE FAILED IN HIS EFFORTS OF TRY ING TO COVER UP SHORTFALL IN CASH BY SUBSTITUTING IT AS CASH LOAN F ROM HIS FAMILY MEMBERS. HE THEREFORE CONFIRMED THE ADDITION MADE B Y THE LEARNED ASSESSING OFFICER. 5 THE LEARNED AUTHORISED REPRESENTATIVE OF THE ASSE SSEE REITERATED THE SUBMISSIONS MADE BEFORE THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS). 6 THE LEARNED DEPARTMENTAL REPRESENTATIVE SUPPORTED THE ORDERS OF THE LOWER AUTHORITIES. 7 WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED T HE ORDERS OF THE LOWER AUTHORITIES AND THE MATERIALS AVAILABLE O N RECORD. IN THE INSTANT CASE THE AO OBSERVED THAT THERE WAS NEGATIV E CASH BALANCE OF RS.14 18 037/- IN THE CASH BOOK OF THE ASSESSEE AND AS BECAUSE THE ASSESSEE COULD NOT EXPLAIN THE SOURCE OF SUCH NEGAT IVE CASH BALANCE HE TREATED THE SAME AS INCOME OF THE ASSESSEE. BEFO RE THE AO THE EXPLANATION OF THE ASSESSEE WAS THAT CERTAIN EXPENS ES RELATING TO SALARY AND FACTORY EXPENSES WERE DEBITED AT A TIME IN THE BOOKS AND HAD THESE BEEN ENTERED ON REGULAR BASIS THERE WOUL D NOT HAVE BEEN ANY CASH SHORTAGE. HOWEVER ON APPEAL BEFORE THE CI T(A) THE ASSESSEE TOOK A DIFFERENT STAND AND SUBMITTED THAT IT BORROWED CASH LOAN OF RS.3 00 000/- FROM SANDEEP S SHAH (HUF) RS .3 58 000/- FROM SUNDERLAL R SHAH (INDL) AND RS.7 70 000/- FROM SHRENIK SUNDERLAL SHAH (HUF) TOTALING TO RS.14 18 000/- WH ICH WERE NOT ENTERED IN THE BOOKS OF ACCOUNT AND AS A RESULT OF WHICH THE BOOKS REFLECTED NEGATIVE CASH BALANCE. THE CIT(A) REJECTE D THE ABOVE EXPLANATION OF THE ASSESSEE AND HELD THAT THIS EXPL ANATION WAS AN AFTER-THOUGHT OF THE ASSESSEE TO COVER UP THE CASH SHORTAGES. BEFORE US THE LEARNED AUTHORISED REPRESENTATIVE OF THE AS SESSEE SUBMITTED 4 THE SAME PLEA WHICH WAS PUT FORWARD BEFORE THE LEAR NED COMMISSIONER OF INCOME TAX (APPEALS). WE FIND THAT CONFIRMATION OF ACCOUNTS FROM THE PARTIES FROM WHOM THE ASSESSEE HAS CLAIMED TO HAVE RECEIVED LOANS IN CASH AND ALSO MADE REPAYMENT OF LOANS IN CASH WERE NOT FURNISHED. THE ASSESSEE COULD NOT FUR NISH ANY EXPLANATION AS TO WHY THE CORRECTED AUDIT REPORT CO ULD NOT BE SUBMITTED BY HIM INCORPORATING THE ALLEGED LOAN TRA NSACTIONS WHICH WERE ALSO NOT APPEARING IN THE AUDIT REPORT. IN THE ABOVE FACTS AND CIRCUMSTANCES OF THE CASE WE DO NOT FIND ANY MERIT IN THIS GROUND OF APPEAL OF THE ASSESSEE. THEREFORE THE SAME IS DISM ISSED. 8 IN THE RESULT THE APPEAL OF THE ASSESSEE IS DISM ISSED. ORDER SIGNED DATED AND PRONOUNCED IN THE COURT ON 26-02-2010 SD/- SD/- (MAHAVIR SINGH) JUDICIAL MEMBER (N S SAINI) ACCOUNTANT MEMBER DATE : 26-02-2010 COPY OF THE ORDER FORWARDED TO : 1. SHRI SUNDERLAL RAICHAND SHAH PROP. OF NIRMAN PH ARMA 211 GIDC VAPI 2. THE ITO WARD-3 VAPI 3. CIT CONCERNED 4. CIT(A)-VALSAD 5. THE DR ITAT AHMEDABAD 6. GUARD FILE BY ORDER DEPUTY REGISTRAR ASSISTANT REGISTRAR ITAT AHMEDABAD