SMT. SWEETY AGARWAL,SILIGURI vs. ITO, NFAC,, DELHI

At the time of hearing, the Ground Nos.2 & 3 are not pressed and therefore, the same are dismissed as not pressed. Similarly, the Ground No.1 is general in nature and does not require any specific adjudication.

The issue in Ground No.4 is against the confirmation of addition of Rs.86,98,551/- by the Ld. CIT(A) as made by the Assessing Officer (in short,

The facts in brief are that the assessee Smt. Sweety Agarwal was the proprietor of M/s Ekta Telecom at the relevant point of time and the said firm was the commission agent of Idea Mobile Commerce Service Ltd and Aditya Birla Idea payment Bank Ltd. The said companies dealt in direct money transfer through online apps under due approval of the Reserve Bank of India (RBI). These companies appointed the assessee as their distributor / commission agent and the companies used to pay the commission on the amount transferred through DMT or IMPS (Direct money transfer / Immediate Payment Service) and the assessee was given commission of less than 1% on the total amount transferred. However, the assessee despite having taxable income, did not file any return of income. The Assessing Officer (in short, ‘AO’) on perusal of certain information available in the taxpayer annual summary (TAS) in the profile of the assessee noted that the assessee has deposited in cash as well as by cheques Rs.1,69,85,250/- as credited / deposited in Axis Bank, besides receiving commission of Rs.10,761/- from Aditya Birla Idea Payment Bank Ltd. and also Rs.1,56,595/- from Idea Mobile Commerce Services Ltd. The AO gave several opportunities to the assessee during the assessment proceedings, however, there was only part compliance on the part of the assessee. The AO noted that assessee had not filed return of income u/s 139(1) of the Act and hence the case of the assessee was re- opened u/s 147 of the Act by issuing notice u/s 148 of the Act, calling for return of income for A.Y. 2018-19. Thereafter, the assessee complied by filling return of income by declaring total income of Rs.1,55,110/- and claiming a refund of Rs.8,370/-. The statutory notices u/s 142(1) and 143(2) of the Act along with the questionnaire, calling upon various details and evidences were 2

Ld. CIT(A) upheld the order of AO by holding that assessee has not filed any correct evidences before the AO and also before the Ld. CIT(A) and therefore, conclusion drawn by AO remained uncontroverted and thus justify the addition made by the AO.

We have heard the rival contentions and perused the material on records. Undisputedly the assessee is a commission agent of two companies, namely, Idea Mobile Commerce Services Ltd. and Aditya Birla Idea payment Bank Ltd. who use to deal in money transfer through online apps (DMT / IMPS) under the valid license of the SBI. The assessee used to accept cash on behalf of two companies from various customers and used to deposit money his bank accounts. Thereafter, immediately the money is used to be remitted to the accounts of these companies through banking channels, i.e.,

We note that from the pattern of entries of the bank account that the highest balance on any single day was only Rs.2,15,649/- and there were regular remittances after every deposit. We also note that this SBI has furnished the copy of account of M/s Ekta Telecom bearing Number 36934742195 giving various transactions of the beneficiaries during the period from 14.08.2017 to 16.01.2018. Considering the facts and evidences available before us, we are of the firm view that the assessee is a commission agent of two companies who are operating money transfer apps. We also note that the AO has accepted the income declared by the assessee by way of receipt of commission from the said transactions. Therefore, we conclude that the assessee has substantiated the source of cash deposit. Thus, making addition in respect of cash deposited in the bank account is totally wrong and cannot be sustained. Consequently, we set aside the order of Ld. CIT(A) and direct the AO to delete the addition. Since, we have allowed the Ground No.4 in favour of the assessee, therefore, the other Grounds raised by the assessee 4

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