Case Law Details
ITO Vs Rajesh Kumar Chhanalal Patel (ITAT Ahmedabad)
Ahmedabad ITAT upholds CIT(A) order deleting the addition of Rs. 86.75 Cr under Section 69A as Assessee’s unexplained income; Holds that the cash deposited in bank account cannot be treated as unexplained as the Revenue himself in the remand report and on verification accepted that the entire cash deposited was accounted for as sales in the books of the Assessee; Assessee-Individual, engaged in the business of trading in gold and silver on wholesale basis, deposited cash of Rs. 86.75 Cr in his current account maintained in a bank account at Jalgaon; During the course of Assessment, Revenue noted that the said bank account in Jalgaon was not disclosed in the Balance Sheet and that the sale invoices were issued to customers in Gujarat and not in Maharashtra; Assessee explained that all the cash deposits in Jalgaon bank account is transferred to the Axis Bank account held in Ahmedabad and the entire amount of deposit is duly reflected in Assessee’s sales account; CIT(A) admitted the additional evidence submitted by the Assessee and deleted the entire addition, against which the Revenue preferred the present appeal; ITAT notes that the Assessee filed additional evidence in the form of revised Balance Sheet and Profit and Loss Account incorporating the Jalgoan Bank account wherein the cash in question was deposited which was not included in the financial statements furnished to the Revenue; Notes Assessee’s submission that the cash deposited in the Jalgaon bank account was transferred to the Ahmedabad bank account and the same was duly accounted for in Assessee’s books; Further notes Assessee’s explanation for non-disclosure of the Jalgaon bank account initially, since all transactions of the Jalgaon account were reflected Ahmedabad bank account, he inadvertently missed out on accounting for the Jalgaon bank account transactions in its books of account; Concurs with CIT(A)’s view that the Assessee had adduced reasonable cause for not filing the revised financial statements during the assessment proceedings and finds no infirmity in CIT(A) order admitting the said additional evidence; Observes that even if additional evidence was not admitted it would not have made any material difference to the factum of cash deposits being explained or not; Notes that the Revenue in its remand report, categorically admitted that all the cash deposited in the Jalgaon bank account are reflected in the Ahmedabad bank account and that the same stands explained; Further notes that the Revenue accepted Assessee’s explanation for the cash deposits of Rs. 77.02 Cr; Rejects Revenue’s contention as regards the remaining amount of deposits, i.e. Rs. 9.72 Cr that the sales invoices for the said amount does not corroborate Assessee’s claim that the sales were made outside the Gujarat, as the invoices were raised for clients in Gujarat, finding no merit therein; Observes that the all cash deposit in Jalgaon bank account was already accounted for as income by way of sales in Assessee’s books of account and the sales and purchases made was shown to tally quantitatively; Thus holds that the any portion of the cash deposits cannot be treated as Assessee’s unexplained income and dismisses Revenue’s appeal. [In favour of assessee] (Related Assessment year : 2012-13) – [ITO v. Rajeshkumar Chhanalal Patel – Date of Judgement : 21.04.2023 (ITAT Ahmedabad)]
FULL TEXT OF THE ORDER OF ITAT AHMEDABAD
Present appeal has been filed by the Revenue against order passed by the ld. Commissioner of Income Tax (Appeals)-10, Ahmedabad [hereinafter referred to as “Ld.CIT(A)”]dated 21.06.2016 under section 250(6) for the Asst.Year 2012-13.
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