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Income Tax Appellate Tribunal, MUMBAI BENCH “D” MUMBAI
Before: SHRI OM PRAKASH KANT & SHRI RAHUL CHAUDHARY
PER OM PRAKASH KANT, AM
This appeal by the assessee is directed against order dated 08/02/2023 passed by the Ld. Commissioner of Income Tax (Appeals)-National Faceless Appeal Centre, Delhi (in short CIT(A)) for assessment year 2017-18, raising following grounds:- 1. On the facts and in the circumstances of the case and in law the order passed by the Honorable CIT (Appeals) is invalid and bad in law.
Ravindra Mahadev Satpute 2 ITA No. 1198/Mum/2023
The appellant has submitted the cash denomination details and The appellant has submitted the cash denomination details and The appellant has submitted the cash denomination details and details of cash deposited in the Hindustan Co-operative Bank details of cash deposited in the Hindustan Co operative Bank Limited amounting to Rs. 47,78,230/- during the course of Limited amounting to Rs. 47,78,230/ during the course of appellate proceedings As the transfer of the money to the appellate proceed As the transfer of the money to the beneficiary is the main objective of the business and there are beneficiary is the main objective of the business and there are beneficiary is the main objective of the business and there are many transactions in a single day, therefore it is not possible to many transactions in a single day, therefore it is not possible to many transactions in a single day, therefore it is not possible to keep the track on the identities of all the customers The appellant keep the track on the identities of all the customers The appellant only keeps basic details of the customers like name and mobile details of the customers like name and mobile number as it is a volume based business and generates very low number as it is a volume based business and generates very low number as it is a volume based business and generates very low income In his submission with Honorable CIT(Appeals) NFAC in In his submission with Honorable CIT(Appeals) NFAC in In his submission with Honorable CIT(Appeals) NFAC in response to the notice of hearing the appellant has requested for response to the notice of hearing the appellant has requested for response to the notice of hearing the appellant has requested for another opportunity of being heard if the matter is to be decided another opportunity of being heard if the matter is to be decided against the appellant but the Honorable CIT(Appeals) NFAC has against the appellant but the Honorable CIT(Appeals) NFAC has against the appellant but the Honorable CIT(Appeals) NFAC has not considered the same. not considered the same. 3. The Ld. AO has failed to use the power vested with him by the The Ld. AO has failed to use the power vested with him by the The Ld. AO has failed to use the power vested with him by the provisions of the Act. As per para 6 and para 8 of the Assessment provisions of the Act. As per para 6 and para 8 of the As provisions of the Act. As per para 6 and para 8 of the As Order it is clear that the Ld. AO is having bank statement with Order it is clear that the Ld. AO is having bank statement with Order it is clear that the Ld. AO is having bank statement with him If he would have reviewed the bank statements for entire If he would have reviewed the bank statements for entire If he would have reviewed the bank statements for entire financial year he could have found that the appellant has financial year he could have found that the appellant has financial year he could have found that the appellant has deposited cash throughout the financial year and had transferred deposited cash throughout the financial year and had transferred deposited cash throughout the financial year and had transferred the same to the bank account of his Principal with whom he was the same to the bank account of his Principal with whom he was the same to the bank account of his Principal with whom he was registered as an agent In response to this activity he has earned registered as an agent In response to this activity he has earned commission which is declared as income and corresponding TDS commission which is declared as income and corresponding TDS commission which is declared as income and corresponding TDS has been claimed which could have been verified from Form has been claimed which could have been verified from Form has been claimed which could have been verified from Form 26AS. 4. All the enquiries pertaining to cash deposits during the All the enquiries pertaining to cash deposits during the All the enquiries pertaining to cash deposits during the demonetization period were for cash deposit of Specified Banned demonetization period were for cash deposit of Specified Banned demonetization period were for cash deposit of Specified Banned Notes (SBN)In the given case the total cash deposit during Notes (SBN)In the given case the total cash deposit during Notes (SBN)In the given case the total cash deposit during demonetization period is Rs. 47,78,230/- out of which SBN demonetization period is Rs. 47,78,230/ out of which SBN amount is Rs. 9,84,500/ 84,500/-. The Ld. AO could have asked for the . The Ld. AO could have asked for the details from the Bank. Even when this details were furnished details from the Bank. Even when this details were furnished details from the Bank. Even when this details were furnished with CIT (Appeals) NFAC and the appellant requested for another with CIT (Appeals) NFAC and the appellant requested for another with CIT (Appeals) NFAC and the appellant requested for another opportunity of being heard if the matter is to be decided against opportunity of being heard if the matter is to be decided against opportunity of being heard if the matter is to be decided against the appellant, the Honorable CIT(Appeals) NFAC has not the appellant, the Honorable CIT(Appeals) NFAC has not considered the same. This resulted in creation of huge demand considered the same. This resulted in creation of huge demand considered the same. This resulted in creation of huge demand which has made appellant's personal life miserable. which has made appellant's personal life miserable. PRAYER:- 1. In the light of the above grounds, your appellant prays that the 1. In the light of the above grounds, your appellant prays that the 1. In the light of the above grounds, your appellant prays that the details available with the Ld. AO as well as Honorable details available with the Ld AO as well as Honorable CIT(Appeals) NFAC should be considered and appellant be given CIT(Appeals) NFAC should be considered and appellant be given CIT(Appeals) NFAC should be considered and appellant be given
Ravindra Mahadev Satpute 3 ITA No. 1198/Mum/2023
chance to submit additional evidence to prove his genuineness chance to submit additional evidence to prove his genuineness chance to submit additional evidence to prove his genuineness and grant relief accordingly. and grant relief accordingly. 2. The appellant craves leave to add, to alter or amend any of the The appellant craves leave to add, to alter or amend any of the The appellant craves leave to add, to alter or amend any of the above grounds of appeal as unds of appeal as may be advised, at any time on or may be advised, at any time on or before the hearing of this appeal. before the hearing of this appeal.
Briefly stated facts of the case that the assessee, proprietor facts of the case that the assessee, proprietor facts of the case that the assessee, proprietor of M/s Mister Enterprises filed its return Mister Enterprises filed its return of income on 31.03.2018 of income on 31.03.2018 declaring total income total income at Rs. 3,87,340/-. The assessee was engaged . The assessee was engaged in the business of Money Transfer as an authorized agent of M/s in the business of Money Transfer as an authorized agent of M/s in the business of Money Transfer as an authorized agent of M/s ITZ Cash Card Limited which was later on taken over by Ebix ITZ Cash Card Limited which was later on taken over by Ebix ITZ Cash Card Limited which was later on taken over by Ebix Payment Services Private Limited Payment Services Private Limited. The assessee use he assessee used to receive money from the customers for further money from the customers for further transfer to their transfer to their friends, relatives etc i.e. beneficiary beneficiary. The assessee used to transfer money to transfer money from his bank account to his principle from his bank account to his principle i.e. ITZ Cash Card Limited i.e. ITZ Cash Card Limited The return of income filed by the assessee was selected for scrutiny. he return of income filed by the assessee was selected for scrutiny. he return of income filed by the assessee was selected for scrutiny. Rs. 47,78,230/- The assessing officer observed The assessing officer observed cash deposited of Rs. 47,78,230/ during demonetization period during demonetization period in bank accounts maintain in bank accounts maintained by the assessee in the Hindustan Co. Op Bank Ltd. In view of no assessee in the Hindustan Co. Op Bank Ltd. In view of no assessee in the Hindustan Co. Op Bank Ltd. In view of no explanation or any submis xplanation or any submission on behalf of the assessee, regarding sion on behalf of the assessee, regarding source of cash deposit, t source of cash deposit, the assessing officer held that the entire he assessing officer held that the entire cash deposited as unexplained unexplained and made addition u/s 69A of the made addition u/s 69A of the Act in the order passed u/s 144 of the Act Act in the order passed u/s 144 of the Act i.e. ex- -parte order. On further appeal, the assessee filed submissions before the Ld. assessee filed submissions before the Ld. CIT(A),however the Ld. CIT(A) upheld the addition observing as however the Ld. CIT(A) upheld the addition observing as however the Ld. CIT(A) upheld the addition observing as under: 5.2 Decision on grounds of appeal and thereof: 5.2 Decision on grounds of appeal and thereof:- I have carefully I have carefully gone through the assessment order, grounds of appeal, gone through the assessment order, grounds of appeal gone through the assessment order, grounds of appeal statement of facts and written submission filed by the appellant statement of facts and written submission filed by the appellant statement of facts and written submission filed by the appellant It has been submitted by the appellant that he is engaged in the It has been submitted by the appellant that he is engaged in the It has been submitted by the appellant that he is engaged in the business of money transfer and is authorized money transfer business of money transfer and is authorized money transfer business of money transfer and is authorized money transfer agent where cash receipt from various customers deposited in agent where cash receipt from various customers deposited in agent where cash receipt from various customers deposited in his account and subsequently transfer it to ITZ Cash Card account and subsequently transfer it to ITZ Cash Card account and subsequently transfer it to ITZ Cash Card
Ravindra Mahadev Satpute 4 ITA No. 1198/Mum/2023
Limited The appellant had submitted the cash denomination Limited The appellant had submitted the cash denomination Limited The appellant had submitted the cash denomination detail and details of cash deposited in the Hindustan detail and details of cash deposited in the Hindustan detail and details of cash deposited in the Hindustan Cooperative Bank Limited amounting to Rs. 47,78,230/-During Cooperative Bank Limited amounting to Rs. 47,78,230/ Cooperative Bank Limited amounting to Rs. 47,78,230/ the course of assessment proc the course of assessment proceedings, a detailed questionnaire eedings, a detailed questionnaire in respect of cash deposited in the bank and its source with in respect of cash deposited in the bank and its source with in respect of cash deposited in the bank and its source with details of identifiable person with PAN or without PAN was details of identifiable person with PAN or without PAN was details of identifiable person with PAN or without PAN was issued to the appellant. But no cogent explanation or reply or issued to the appellant. But no cogent explanation or reply or issued to the appellant. But no cogent explanation or reply or detail was submitted by the appellant i detail was submitted by the appellant in respect of the above n respect of the above cash deposit during the demonetization period Even during cash deposit during the demonetization period Even during cash deposit during the demonetization period Even during appellate proceedings also, apart from submitting that the appellate proceedings also, apart from submitting that the appellate proceedings also, apart from submitting that the appellant is in business of money transfer and is authorized appellant is in business of money transfer and is authorized appellant is in business of money transfer and is authorized money transfer agent no explanation or details of persons from money transfer agent no explanation or details of perso money transfer agent no explanation or details of perso whom the above cash deposited was received by the appellant, whom the above cash deposited was received by the appellant, whom the above cash deposited was received by the appellant, had not been submitted If a person is an authorized money had not been submitted If a person is an authorized money had not been submitted If a person is an authorized money transfer agent, it is his obligatory duty to properly maintain the transfer agent, it is his obligatory duty to properly maintain the transfer agent, it is his obligatory duty to properly maintain the accounts/details of person from whom cash was received and accounts/details of person from whom cash was received and accounts/details of person from whom cash was received and further deposited in the bank account and accordingly transfer ther deposited in the bank account and accordingly transfer ther deposited in the bank account and accordingly transfer to the account of beneficiary. The appellant has failed to to the account of beneficiary. The appellant has failed to to the account of beneficiary. The appellant has failed to discharge this primary onus of source of the cash deposit in the discharge this primary onus of source of the cash deposit in the discharge this primary onus of source of the cash deposit in the bank during assessment proceedings as well as in the bank during assessment proceedings as well as in the bank during assessment proceedings as well as in the appellate proceedin appellate proceedings Therefore, I have no other option but to gs Therefore, I have no other option but to upheld the addition of Rs. 47,78,230/ upheld the addition of Rs. 47,78,230/- on account of on account of unexplained money u/s 69A made by the AO. Thus Ground no. unexplained money u/s 69A made by the AO. Thus Ground no. unexplained money u/s 69A made by the AO. Thus Ground no. 3 raised by the appellant is dismissed 3 raised by the appellant is dismissed 3. Before us the Ld. Counsel Before us the Ld. Counsel for the assessee filed an applica the assessee filed an application for admitting additional evidence admitting additional evidences containing page 1 to 81. The Ld containing page 1 to 81. The Ld Counsel submitted that out of the entire sum of Rs. 47,78,230/- Counsel submitted that out of the entire sum of Rs. 47,78,230/ Counsel submitted that out of the entire sum of Rs. 47,78,230/ only very small amount of Rs. 47,78,230/ only very small amount of Rs. 47,78,230/- was received on was received on 08.11.2016 in old notes in old notes and balance amount received and balance amount received was in new currency only. Further . Further, he submitted that the assessee he submitted that the assessee willing to file complete details of the name and address of the persons from file complete details of the name and address of the persons from file complete details of the name and address of the persons from whom cash has been deposited cash has been deposited for verification by the Assessing for verification by the Assessing Officer. 4. We have heard heard rival submission of parties and p parties and perused the material on record. We find the Ld. CIT(A) has sustained the material on record. We find the Ld. CIT(A) has sustained the material on record. We find the Ld. CIT(A) has sustained the addition mainly for the reason of absence of identity of the persons addition mainly for the reason of absence of identity of the persons addition mainly for the reason of absence of identity of the persons who has deposited the money. Before us the Ld. Counsel for the who has deposited the money. Before us the Ld. Counsel who has deposited the money. Before us the Ld. Counsel
Ravindra Mahadev Satpute 5 ITA No. 1198/Mum/2023
assessee has filed additional evidences and express filed additional evidences and express willingness to filed additional evidences and express justify nature and source of the cash deposited in the bank account justify nature and source of the cash deposited in the bank account justify nature and source of the cash deposited in the bank account which has been held by the assessing offic which has been held by the assessing officer as unexplained cash er as unexplained cash deposit. Accordingly, deposit. Accordingly, we feel appropriate to restore this issue back appropriate to restore this issue back to the file of the assess to the file of the assessing officer for deciding afresh. If required the r deciding afresh. If required the assessing officer may call for the information regarding name and assessing officer may call for the information regarding name and assessing officer may call for the information regarding name and address of person who who had cash deposited, from the principle M/s the principle M/s ITZ Cash Card Limited Card Limited. The assessing officer is at liberty to carry is at liberty to carry out any enquiries as d as deemed fit in facts and circumstances of the in facts and circumstances of the case, however, he shall provide , he shall provide adequate opportunity being heard to adequate opportunity being heard to the assessee. Accordingly the assessee. Accordingly, grounds of the appeal of the assessee of the appeal of the assessee are allowed for statistical purpose. allowed for statistical purpose. 5. In the result, appeal of the assessee i In the result, appeal of the assessee is allowed for statistical s allowed for statistical purpose.
Order pronounced in the open Court on nounced in the open Court on 08/11 11/2023. Sd/ Sd/- Sd/- (RAHUL CHAUDHARY RAHUL CHAUDHARY) (OM PRAKASH KANT OM PRAKASH KANT) JUDICIAL MEMBER JUDICIAL MEMBER ACCOUNTANT MEMBER ACCOUNTANT MEMBER Mumbai; Dated: 08/11/2023 Shubham P. Lohar Copy of the Order forwarded to Copy of the Order forwarded to : 1. The Appellant 2. The Respondent. 3. CIT 4. DR, ITAT, Mumbai 5. Guard file. BY ORDER, BY ORDER, //True Copy// (Assistant Registrar) (Assistant Registrar) ITAT, Mumbai ITAT, Mumbai