CHIRAG MAHESHKUMAR VYAS,AHMEDABAD vs. THE DY.CIT, CENTRAL CIRCLE-2(2), AHMEDABAD

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ITSSA 14/AHD/2024Status: DisposedITAT Ahmedabad19 December 2024AY 2016-173 pages

In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.

AI SummaryAllowed

What did the Tribunal hold?

The Tribunal found that the assessee had sufficient cash withdrawals to prove the sources of Rs.7,67,580/-. Furthermore, the Tribunal noted that the assessee had declared agricultural income of Rs.1,60,000/- in AY 2009-10 and Rs.1,62,000/- in AY 2011-12. After the survey, the assessee filed a return of income declaring a total income of Rs.49,41,000/-. Considering the return of income filed and the past agricultural income earned, coupled with the bank withdrawals, the Tribunal held that no further addition was warranted on account of capital receipt, unexplained money, or agricultural income. The additions upheld by the CIT(A) were therefore deleted.

What were the facts?

The assessee, Chirag Maheshkumar Vyas, an individual and Director in M/s. John Energy Limited, filed an appeal against the order dated 22.06.2024 passed by the CIT(A)-12, Ahmedabad, for Assessment Year 2016-17. The appeal challenges additions aggregating to Rs.13,14,524/- made by the Assessing Officer (AO) and upheld by the CIT(A). These additions comprised Rs.5,00,000/- claimed as received from the assessee's daughter, Rs.7,67,580/- related to capital receipt/unexplained money, and Rs.46,944/- from agricultural income. A search survey action was conducted in the M/s. John Energy group on 08.03.2016, which led to the assessment proceedings.

What were the issues?

1. Whether the addition of Rs.5,00,000/- to the assessee's capital account, claimed to be received from his daughter, Ms. Richa Chirag Vyas, is to be treated as unexplained income under Section 68 of the Income Tax Act, 1961, due to non-submission of evidence regarding its source. 2. Whether the addition of Rs.46,944/- from the Rs.4,44,000/- declared as agricultural income is justified due to non-compliance. Assessee's Contentions: The assessee contended that the CIT(A) erred in upholding the additions aggregating to Rs.13,14,524/-. The grounds of appeal primarily challenge the legality and factual correctness of the CIT(A)'s order confirming the AO's additions. The assessee prayed for the deletion of these upheld additions. Revenue's Contentions: The judgment does not record specific contentions made by the revenue.

Which sections of the Income-tax Act were involved?

Section 68

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “C” BENCH, AHMEDABAD

Before: DR. BRR KUMARSHRI TR SENTHIL KUMAR

For Appellant: Shri SN Divetia with Shri Samir Vora,, ARs
For Respondent: Shri A P Singh, CIT. DR
Pronounced: 19.12.2024

IN THE INCOME TAX APPELLATE TRIBUNAL “C” BENCH, AHMEDABAD BEFORE DR. BRR KUMAR, VICE PRESIDENT SHRI TR SENTHIL KUMAR, JUDICIAL MEMBER I.T(SS)A. No.14/Ahd/2024 (Assessment Year: 2016-17) Chirag Maheshkumar Vyas, Vs. D.C.I.T, Sivalaya Sr.No.8, Central Circle-2(2), Swatantra Ashok Vatika Road, Ahmedabad. Opp. Kotak House, Bodakdev, Ahmedabad-380054. [PAN No.ABYPV5751G] (Appellant) .. (Respondent) Appellant by : Shri SN Divetia with Shri Samir Vora,, ARs Respondent by: Shri A P Singh, CIT. DR 12.12.2024 Date of Hearing Date of Pronouncement 19.12.2024 O R D E R

PER: DR. BRR KUMAR, VICE PRESIDENT: This appeal has been filed by the Assessee against the order passed by the Ld. Commissioner of Income Tax (Appeals)-12, Ahmedabad, vide order dated 22.06.2024 passed for the Assessment Year 2016-17.

2.

The Assessee has taken the following grounds of appeal:-

1.1 The order passed by U/s.250 passed on 22.06.2023by CIT(A)-12, Ahmedabad upholding the additions aggregating to Rs.13,14,524/-(Rs.5,00,000 + 7,67,580 + 46944) made by AO is wholly illegal, unlawful and against the principles of natural justice.

IT(SS)A No. 14/Ahd/2024 Chirag M Vyas vs. DCIT Asst.Year –2016-17 - 2– 2.1 The ld.CIT(A) has grievously erred in law and or on facts in upholding the additions aggregating to Rs.13,14,524/- (Rs.5,00,000 + 7,67,580 + 46944) made by AO. 2.2 That the in the facts and circumstances of the ld.NFAC ought not to have upheld the additions aggregating to Rs.13,14,524/- It is therefore, prayed that the additions upheld by the CIT(A) may kindly be deleted.

3.

The assessee is an individual and Director in M/s. John Energy Limited. A search survey action has been conducted in the case of M/s.John Energy group on 08.03.2016. During the course of assessment proceedings, the AO noticed that there has been an increase in the capital account of the assessee by an amount of Rs.5,00,000/- which was claimed to be received from his daughter Ms Richa Chirag Vyas. Owing to the non submission of evidences regarding the source of increased in capital, the AO treated the amount of Rs.5,00,000/- u/s.68 of the Act, as unexplained income. Further, the AO made addition of Rs.46,944/- from the amount of Rs.4,44,000/- declared by the assessee as income from agriculture. The Ld.CIT(A), confirmed the addition owing to non-compliance.

4.

On going through the records, we find that the assessee had sufficient cash withdrawal to prove the sources of Rs.7,67,580/- and we also find that the assessee had shown agricultural income of Rs.1,60,000/- in the AY 2009-10 and Rs.1,62,000/- in AY 2011-12. Post survey, the assessee filed return of income declaring total income of Rs.49,41,000/-. Hence, the claim of the assessee in declaring the agricultural income cannot be disputed at this juncture. Keeping in view, the return of income and the earning of agricultural income, the bank withdrawals we hold that no further addition

IT(SS)A No. 14/Ahd/2024 Chirag M Vyas vs. DCIT Asst.Year –2016-17 - 3–

is called for on account of capital receipt, unexplained money and agricultural income.

5.

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

This Order pronounced in Open Court on 19.12.2024

Sd/- Sd/- (TR SENTHIL KUMAR) (DR. BRR KUMAR) JUDICIAL MEMBER VICE PRESIDENT (True Copy) Ahmedabad; Dated 19.12.2024 Manish, Sr. PS TRUE COPY आदेश क� �ितिलिप अ�ेिषत/Copy of the Order forwarded to : 1. अपीलाथ� / The Appellant 2. ��यथ� / The Respondent. 3. संबंिधत आयकर आयु� / Concerned CIT 4. आयकर आयु�(अपील) / The CIT(A)- 5. िवभागीय �ितिनिध, आयकर अपीलीय अिधकरण, अहमदाबाद / DR, ITAT, Ahmedabad 6. गाड� फाईल / Guard file. आदेशानुसार/ BY ORDER,

सहायक पंजीकार (Asstt.Registrar) आयकर अपीलीय अिधकरण, अहमदाबाद / ITAT, Ahmedabad

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