AMITABEN KANJIBHAI PATEL,,AHMEDABAD vs. THE INCOME TAX OFFICER, WARD-7(2)(1),, AHMEDABAD

आदेश/ORDER PER : AMARJIT SINGH, ACCOUNTANT MEMBER:-

2. She has erred in law and on facts in upholding order passed u/s. 143(3) r.w.s. 147 in as much as that conditions of section 147 for reopening were not fulfilled.

3. She has erred in law and on facts in sustaining addition of Rs. 13,11,000/- u/s. 68 being cash deposit in S.B. account with ICICI Bank without properly appreciating the facts and evidence adduced by the appellant.

4. The addition of Rs. 13,11,000/- u/s.68 ought to have been held as bad in law and on facts as no books are maintained by the assessee and the impugned amount does not pertain to her.

5. She has erred in law and facts in not considering and appreciating the contention of the appellant that even if the explanation of the assessee is not found satisfactory if will not automatically entitle the AO to treat the said receipts as income of the assessee the word used in section 68/69 is "MAY" and not "SHALL" read with the decision of Supreme Court and Gujarat High Court.

6. On the facts of the appellant no such addition ought to have been confirmed.

7. On the facts no interest u/s 234B of the IT. Act ought to have been levied.”

3. The assessee has not filed return of income within the time limit prescribed u/s. 139(1) of the act or till 31st March, 2014. The assessing officer was having information that assessee had made substantial cash deposit in her bank account with the ICICI Bank. Therefore, a notice u/s. 148 of the act was issued on 13th March, 2014. The assessee has not made any compliance till issuing of further notice dated 11th August, 2014 and 24th Nov, 2014. The assessee has filed return of income for the assessment year 2010-11 on 8th December, 2014 declaring taxable income of Rs. 1,09,626/-. During the course of assessment, the assessee reported that it was her first year of business of trading in iron and steel on retail basis. The assessing officer observed that assessee has shown purchase from only one dealer M/s. Harikrishna Steel Trader and details, address, phone no. etc. of the dealer was not furnished. Subsequently, the assessee has furnished copy of ledger account and the postal address of the dealer, however, on making inquiry the assessing officer noticed that no such dealer was existed at the given address and notice was also returned un-served. Thereafter, the assessee was asked Page No 3 Amitaben Kanjibhai Patel vs. ITO to furnish the source of cash deposit found in the saving bank account maintained with ICICI Bank. The assessee reported that she had deposited all her business cash into bank account. The assessing officer had provided copy of the bank statement to the assessee for giving proper reply of the entries of cash deposit reflected in the bank account statement. The assessee explained that she was not liable to maintain books of account and her total turnover was higher than the cash deposited in the bank account. The assessing officer stated that the assessee has not furnished any concrete evidences of depositing of cash of Rs. 8 lacs on 13th Nov, 2009 and depositing of cash of Rs. 5 lacs on 16th December, 2009 and failed to prove the source of cash deposited in the bank account. Consequently, the assessing officer had made addition of Rs. 13,11,000/- to the total income of the assessee as unexplained cash deposit detected in the bank account.

4. The assessee has filed appeal before the ld. CIT(A). Before the ld. CIT(A) the assessee had changed her explanation stating that the said bank account was not opened by her at all and this was opened by a travel agent and all the transactions in the bank were made by the travel agent to whom she had contacted to obtain visa letter etc. The ld. CIT(A) has dismissed the appeal of the assessee after considering the evidences on record on failing of the assessee to substantiate the source of cash deposited in the bank account

Page No 5 Amitaben Kanjibhai Patel vs. ITO Thereafter, on 13th March, 2014 a notice u/s. 148 was issued to the assessee to file the return of income within 30 days from the receipt of the notice. It is clear from the facts reported above that assessee has not filed any return of income u/s. 139(1) of the act. It is undisputed fact that huge cash deposit was found in the S.B. Account No. 093001502470 of the assessee maintained with the ICICI Bank. The assessing officer vide letter dated 19- 12-2013 had brought to the notice of the assessee that Income Tax Department has received information relating to financial activities of the assessee and provided information summary pertaining to the PAN of the assessee which also contain the information that during F.Y. 2008-09 there was a cash deposit of more than 10 lacs in the saving bank of the assessee. No compliance was made by the assessee until issuing of notices and reminders as referred in this order. It was also brought to the notice of the assessee vide letter that 19-12-2013 that as per information summary pertaining to the TDS there was also transactions with the PAN of the assessee of interest other than the interest on securities. Even the assessee had failed to make compliances with notice u/s. 142(1) of the act issued by the assessing officer. It is clear from the above fact that the assessing officer had given due opportunity to the assessee but there was no compliance from the assessee. The case laws relying upon by the assessee are distinguishable on facts and are of no help to the assessee in the present case. In the light of the above facts and circumstances, we do not find any reason to interfere in the decision of ld. CIT(A) in justifying the action of the assessing officer in reopening the assessment. Therefore, we uphold reopening of assessment under section 148 of the Act. Accordingly, ground nos. 1 & 2 of the assessee are dismissed.

Page No 6 Amitaben Kanjibhai Patel vs. ITO Grounds of appeal no. 3 to 6:- In addition to the facts as elaborated above, the assessee has filed the income tax return only on 8th December, 2014 declaring income of Rs. 1,09,626/-. The assessee has claimed in the return of income that she has earned business income of Rs. 80,984/- from the business of trading in iron and steel, however, on verification the assessing officer noticed that assessee has claimed purchases made from one party M/s. Harikrishna Trader but the said party was not existed at the given address. The assessee could not substantiate with relevant evidences that she was engaged in any business. Subsequently before the ld. CIT(A) the assessee had claimed that she had not signed the account opening form and the bank account was operated by her travel agent. The assessee has failed to furnish any communication from the bank stating that this account was not pertained to her. In this regard, we have verified the paper book submitted by the assessee and it is noticed that at page no. 29 to 31 the assessee has placed the copy of income tax return filed by the assessee for the year under consideration on 8th December, 2014 with the income tax return W-7(2)(1) and in the return of income the assessee herself has declared and owned up the impugned saving bank account no. 093001502470 maintained with the ICICI Bank in which the impugned cash was deposited. In view of the above facts and circumstances, it is clear that assessee has herself claimed and owned up the above referred saving bank account in income tax return filed by her. It is demonstrated from the above cited material fact that assessee had disclaimed this bank account without any basis and inexactly stated that it was pertained to travel agent. The assessee has given contradictory statement first at the level of assessing officer that she has earned the cash deposited in the said saving bank account Page No 7. Amitaben Kanjibhai Patel vs. ITO from her business of trading in iron and steel when she has failed to substantiate her claim with relevant evidences then she has made new submission before the ld. CIT(A) that the said saving bank account with ICICI was not opened and operated by her and it was not pertained to her. However, she has failed to substantiate her new claim with any relevant evidences and material. As discussed above in this order on perusal of the relevant material on record, it is noticed that assessee has herself reported under her signature in her income tax return filed after replying the notices from the assessing officer that the impugned bank account with the ICICI Bank was pertained to her. In the light of the above facts and circumstances, we consider that the assessee has failed to substantiate the source of cash deposit detected in the saving bank account, therefore, we do not find any infirmity in the decision of ld. CIT(A). In view of the discussion made above, we do not find any merit in the grounds of appeal 3 to 6 of the assessee, therefore, all these grounds of appeal stand dismissed.