PARIKSHIT RAJPUROHIT,JAIPUR vs. ITO, JAIPUR

आयकर अपीलीय अधिकरण] जयपुर न्यायपीठ] जयपुर IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHE-A, JAIPUR Jh fot; iky jko] U;kf;d lnL; ,oa Jh foØe flag ;kno] ys[kk lnL; ds le{k BEFORE: SHRI VIJAY PAL RAO, JM & SHRI VIKRAM SINGH YADAV, AM vk;dj vihy la-@ITA No. 799/JP/2016 fu/kZkj.k o"kZ@Assessment Year :2009-10 cuke Shri Parikshit Rajpurohit Income-tax Officer, Vs. E-6/282, Chitrakoot Yojna, Ward-3(4), Jaipur Vaishali Nagar, Jaipur LFkk;h ys[kk la-@thvkbZvkj la-@PAN/GIR No.: AGVPP1934D vihykFkhZ@Appellant izR;FkhZ@Respondent fu/kZkfjrh dh vksj ls@ Assessee by : Shri Sidharth Ranka (Adv.) jktLo dh vksj ls@ Revenue by : Shri J. C. Kulhari (JCIT) lquokbZ dh rkjh[k@ Date of Hearing : 13/11/2018 mn?kks"k.kk dh rkjh[k@Date of Pronouncement: 05/02/2019 vkns'k@ ORDER PER: VIKRAM SINGH YADAV, A.M.

This is an appeal filed by the assessee against the order of ld. CIT(A), Jaipur dated 25.01.2016 wherein the assessee has taken the following grounds of appeal:-

1. That on the facts and in the circumstances of the case, the ld. Lower authorities grossly erred in making addition on account of cash deposited in the bank account and in treating the same as unexplained income of the assessee appellant. 1.1 That on the facts and in the circumstances of the case, the ld. CIT(A) grossly erred in confirming the addition to the extent of Rs. 6,53,150/-“

2. At the outset, the ld. AR submitted that the ld. CIT(A) has passed an order u/s 154 on 21.04.2016 wherein the addition which was initially sustained Parikshit Rajpurohit, Jaipur Vs. ITO, Jaipur to the extent of Rs. 6,53,150/- has been reduced to Rs. 5,32,000/-. Hence, the present appeal, the assessee has challenged the addition to the extent of Rs. 532,000/-. It was further submitted that there is a delay in filing the present appeal and in support, an affidavit has been filed stating that the assessee was travelling outside the country from the period March to July and thereafter, immediately on receipt of the rectification order, the assessee has filed the present appeal and the delay so occurred may be condoned in the interest of justice. After hearing both the parties, the delay so occurred in filing the present appeal is condoned and admitted for hearing on merits.

3. It was submitted by the ld. AR that the addition so sustained by the ld. CIT(A) is mainly on account of not accepting the opening cash balance of Rs. 1.8 lakhs and cash receipt from sale of handicraft items of Rs. 5,32,000/- as source of cash deposits in his bank accounts during the financial year.

4. Regarding opening cash in hand, the ld. AR submitted that the assessee has withdrawn cash towards end of the previous financial year and bank account statements were produced in support of his claim. In this regard, the ld. CIT(A) has returned a finding that the assessee has in the remand proceedings given evidence in support of withdrawals to the extent of Rs. 1,80,000/- in the last few months of the preceding year. However, it cannot be accepted that the whole of such withdrawals would have remained as cash in hand and the appellant has also made deposits in cash in bank accounts and also made payments for credit cards. Further, some withdrawals would have been utilized for house hold expenses. Considering all these facts, he held that the end of justice would be met if the appellant’s claim regarding opening cash is restricted up to Rs. 1,00,000/-. We donot find any infirmity in the said findings of the ld CIT(A) and the same is hereby confirmed. Parikshit Rajpurohit, Jaipur Vs. ITO, Jaipur 5. Regarding sale of the handicraft items amounting to Rs. 5,32,000/-, the ld. AR submitted that these were personal effects which were purchased by the assessee through payments made through credit cards. Later on, these were sold for cash and tax on sale of these items as capital gains have been paid and duly informed to the AO vide reply filed on 21.01.2011. It was accordingly submitted that when the purchases were not disputed by the Assessing Officer amounting to Rs. 5,06,500/- and when the tax on the sale has already been paid by the assessee, there is no basis with the Revenue in not accepting the source of cash deposit from sale of handicraft items of Rs. 5,32,000/-. The ld. CIT(A) has rejected the claim of the assessee holding that assessee has failed to substantiate its claim of sale of the items. He held that the assessee should have produced the parties to whom the sale was made in order to satisfy the AO about genuineness of these transactions. Accordingly, explanation of the assessee regarding the source of cash of Rs. 5,32,000/- was not accepted by the ld. CIT(A). We find that where the purchases have not been disputed by the Revenue and on the sale, the assessee has paid the taxes on the resultant gains, there is no basis for the Revenue to hold that source of deposit of sale proceeds has not been satisfactorily explained by the assessee. In the result, we set-aside the findings of the ld CIT(A) to this extent and hold the source of cash deposit to the extent of Rs 5,32,000 duly explained by the assessee.

In the result, the appeal of the assessee is partly allowed.

Order pronounced in the Open Court on 05/02/2019.