SHAILESHKUMAR NARSHEEBHAI GOTI,BHAVNAGAR vs. THE ITO, WARD-1(10), BHAVNAGAR

The Learned Commissioner of Income Tax (Appeals) [Ld. CIT(A)] has erred in law and on facts in confirming the assessment order passed by the Learned Assessing Officer (Ld. AO) without proper assumption of juri iction as mandated under the provisions of the Income Tax Act, 1961. ITA No. 697/AHD/2026, AY-2017-18 Shaileshkumar N Goti - 2–

The Ld. CIT(A) has erred in law and on facts in confirming the additions made by the Ld. AO by disregarding the fact that the books of accounts of the appellant were duly audited by a qualified auditor and no discrepancies or adverse remarks were pointed out during the course of such audit.

The non-consideration of CBDT Circular No. 03/2017 dated 21-02-2017, being a legal issue, may kindly be admitted even if not urged earlier.

The Ld. CIT(A) has erred in law by ignoring and failing to consider the documents and submissions furnished by the appellant during the appellate proceedings, despite the same being specifically brought on record for consideration.

The Ld. CIT(A) has erred in law in confirming the levy of interest under sections 234A, 234B, 234C, and 234D of the Income Tax Act, 1961, without proper appreciation of facts and applicable law.

The Ld. CIT(A) has erred in law in upholding /intimating the initiation of penalty proceedings under section 274 read with section 271AAC of the Income Tax Act, 1961, which is bad in law and unsustainable on facts.

The appellant craves leave to add, alter, amend, modify, or withdraw any of the above grounds of appeal at any time on or before the hearing of the appeal.

Brief facts of the case are that the assessee is engaged in the business of selling recharge vouchers of telecom companies such as Idea, Airtel, etc. For the Assessment Year 2017-18, the assessee filed its return of income on 01.11.2017 declaring a total income of Rs.3,47,610/-. The books of account of the assessee were duly maintained and audited under section 44AB of the Income-tax Act, 1961. The return of income was processed under section 143(1) of the Act. Subsequently, the case was selected for scrutiny and notices under sections 143(2) and 142(1) of the Act were issued. In response thereto, the assessee furnished the requisite details, books of account, Shaileshkumar N Goti - 3– documentary evidence and explanations as called for by the Assessing Officer. Thereafter, the Assessing Officer completed the assessment under section 143(3) of the Act. While framing the assessment, the Assessing Officer made the following additions: (i) addition of Rs.1,00,000/- under section 68 of the Act as unexplained cash credit; (ii) addition of Rs.85,313/- under section 68 of the Act as unexplained cash credit; and (iii) addition of Rs.32,68,250/- being cash deposits in the bank account, treating the same as unexplained cash credit under section 68 of the Act. Consequently, the Assessing Officer determined the total income after making the aforesaid additions and raised a tax demand of Rs.35,45,424/-.

Aggrieved by the assessment order, the assessee preferred an appeal before the Ld. (Appeals). During the appellate proceedings, the assessee filed detailed written submissions along with supporting documentary evidence. Upon consideration of the material available on record, the Ld. CIT(A) deleted the additions of Rs.1,00,000/- and Rs.85,313/- made under section 68 of the Act. However, the Ld. CIT(A) confirmed the addition of Rs.32,68,250/- in respect of cash deposits made in the bank account by treating the same as unexplained under section 68 of the Act.

Being aggrieved by the order of the Ld. CIT(A), the assessee is now in appeal before this Tribunal.

On going through the record, it could be found that the assessee is in the business of recharge of mobile services and receive total cash of Rs.2.95 crores during the year against the sale of Rs.3.02 crores of recharge coupon. The amounts have been deposited in cash in the bank Shaileshkumar N Goti - 4– account and further transferred to the service provider. Since the factum of sale of recharge coupons and subsequent transferring of monies to the service provider are not in dispute and clear from record, it is hereby held that no addition on account of cash deposit on account of assessee is called for.

In the result, the appeal filed by the assessee is allowed.

""थ"/ The Respondent. 3. संबंिधतआयकरआयु"/ Concerned CIT 4. आयकरआयु"(अपील) /The CIT(A)- 5. िवभागीय"ितिनिध, आयकरअपीलीयअिधकरण, अहमदाबाद/ DR, ITAT, Ahmedabad 6. गाड"फाईल /Guard file. आदेशानुसार/ BY ORDER,सहायकपंजीकार (Dy./Asstt.