SHRI SAMIRBHAI ABDULBHAI CHAUHAN,,BHARUCH vs. THE INCOME TAX OFFICER, WARD-1,, BHARUCH

Samirbhai Abdulbhai Chauhan. v. ITO, Ward-1, Bharuch./ITA No.1673/AHD/2014 /A.Y. 2009-10 Page 1 of 5 आयकरअपील�यअ�धकरण,सुरत�यायपीठ,सुरत IN THE INCOME TAX APPELLATE TRIBUNAL SURAT BENCH, SURAT BEFORE SHRI SANDEEP GOSAIN, JUDICIAL MEMBER AND SHRI O.P.MEENA, ACCOUNTANT MEMBER आ.अ.सं./I.T.A No.1673/AHD/2014 �नधा�रणवष�/Assessment Year: 2009-10 Samirbhai Abdulbhai Chauhan, V. Income Tax Officer, Ward-1, 5-6, Shiv Complex, 2nd Floor, Bharuch Modi Compound, Panchbatti, Bharuch-392001. [PAN: AFMPC 6548 Q] अपीलाथ� / Appellant ��यथ�/Respondent �नधा�रतीक�ओरसे /Assessee by Shri Sakar Sharma, CA राज�वक�ओरसे /Revenue by Smt. Anupama Singhla, Sr. DR

04.12.2019 सुनवाईकीतारीख/ Date of hearing: उ�घोषणाक�तार�ख/Pronouncement on: 06.12.2019 आदेश /O R D E R PER O.P.MEENA, AM: This appeal filed by the Assessee is directed against the order of 1. Ld. Commissioner of Income Tax (Appeals)-VI, Baroda [in short “CIT(A)”] dated 01.01.2014 for the assessment year 2009-10. Condonation of delay:- 2. The ld. Counsel for the assessee submitted that there is delay in filing of appeal by 41 days, which is caused as the assessee was constantly travelling and therefore could not approach his tax consultant at Baroda to make up the appeal in time. As he came to

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know the order of the CIT(A) only when he reach to Bharuch after completing consultancy work. In support of his contention the assessee has filed an affidavit dated 19-05-2017. We have heard the parties and observed that the assessee has satisfactory to explained the delay caused in filing of appeal before this Tribunal which is not on account of negligence, therefore we condone the delay in filing the appeal and allowed the appeal to be proceeded on merits. Ground no.1 relates to confirming addition of Rs.4,40,447/- 3. u/s.68 of the Act for the amount deposited in Axis Bank Account. Brief facts are that the assessee is engaged in the client 4. consulting business for admission of students to various universities and for every single admission university pay commission to assessee in cash. The AO noticed that Rs.17,11,435/- has been deposited in his saving bank account maintained with Axis Bank Ltd in cash on different dates. It was explained that cash deposits and cash withdrawals are on account of amount received from the students as travelling expenses and consulting fees by the assessee. However, this explanation was not accepted by AO and an addition of Rs.4,40,447/- being peak cash balance in the Axis bank as on 25-05-2008 was made. Being aggrieved, the assessee carried the matter before the 5. CIT(A). Wherein it was pleaded that after rejection of books of account by invoking the provision of Section 145(3), no separate addition can be made u/s.68 of the Act. However, the CIT(A) observed that the assessee

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has failed to explain with supporting evidence of cash deposit, hence the addition made by the AO was confirmed. Being aggrieved, the assessee filed this appeal before this 6. Tribunal. The ld. counsel submitted that the addition has been made on the basis of peak credit, however no credit is given for opening balance of Rs.61,100/- as on cash withdrawal prior to deposit in bank. It was further submitted that the AO has not given credit for income of Rs.2,49,356/- declared in the return of income. Further, the books of account have been rejected u/s.145(3) and therefore instead of making separate addition u/s.68 on peak basis net income ought to have been estimated from consultancy activity. The assessee was engaged in the education related activity which has not been disputed by the AO. Per contra, the Sr. Departmental Representative (DR) relied on 7. the order of the authorities below and submitted that there is no relation with the income declared in the return of income and the cash deposit in the bank account. We have heard the rival submissions and perused the relevant 8. material available on record. We find that the assessee has shown opening balance of Rs.61,100/- as on 01-04-2009. Further, the assessee has shown return income, whereas the bank account not undisclosed therefore, the credit of return income of Rs.2,49,356/- is required to be given. Therefore, after careful consideration of facts. We direct the AO to allow the credit of opening balance of Rs.61,100/- and credit of

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Rs.2,49,356/- out of peak addition of Rs.4,40,447/-. This ground of appeal is partly allowed. Ground No.2 is against the confirmation of addition of 9. Rs.7,10,000/- being amount deposited in Baroda Gujarat Gramin Bank Account. Brief facts of the case are that the AO found that the statement 10. of Baroda Gujarat Gramin Bank, the assessee has deposited cash on various dates and the total deposits during the year were at Rs.7,10,000/-. Since, the assessee has not able to explain and explanation furnished by the assessee was not found acceptable, the AO treated the entire deposit amounting to Rs.7,10,000/- as unexplained cash credit u/s.68 of the Act. Being aggrieved, the assessee carried the matter before the 11. CIT(A), but without any success. Being aggrieved, the assessee filed this appeal before Tribunal. 12. The ld. counsel submitted that the credit for cash constantly withdrawan from Axis Bank account should have been allowed to the assessee. It was further submitted that highest peak balance worked out to Rs.2,48,116/- as on 01-08-2008. Therefore, the CIT(A) was not justifying in sustaining the addition of entire deposits in the bank account. Per contra, the ld. Sr. Departmental Representative (DR) 13. supported the order of authorities below.

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We have heard the rival submissions and find that the deposits in 14. the bank accounts are unexplained. However, the AO should have made addition on account of peak credit by considering the cash deposits and withdrawals in the said bank account. Since, the peak balance as on 01- 08-2008 is at Rs.2,48,816/-. Accordingly, the addition of Rs.7,10,000/- is restricted to highest peak balance of Rs.2,48,816/- as per the Bank of Baroda Gujarat Gramin Bank account. Accordingly, this ground of appeal is partly allowed. 15. In the result, the appeal of the assessee is partly allowed. Order pronounced in the open court on 06.12.2019. 16.

Sd/- Sd/- (SANDEEP GOSAIN) (O.P.MEENA) JUDICIAL MEMBER ACCOUNTANT MEMBER सुरत/ Surat, �दनांक Dated: 6th December, 2019/S. Samanta, PS Copy of order sent to- Assessee/AO/Pr. CIT/ CIT (A)/ ITAT (DR)/Guard file of ITAT. By order // TRUE COPY // / / TRUE COPY / Assistant Registrar, Surat