RAMESH SAKHARAM KASAR,RAIGAD vs. INCOME-TAX OFFICER, WARD - 3, PANVEL

आदेश / ORDER PER ANIL CHATURVEDI, AM :

Assessee is an individual, who filed his return of income for A.Y. 2014-15 on 13.10.2015 declaring total income at Rs.2,91,250/-. The case was selected for scrutiny and thereafter assessment was framed u/s

143(3) of the Act vide order dt.20.09.2016 and the total income was

determined at Rs.37,27,215/-. Aggrieved by the order of AO, assessee

carried the matter before Ld.CIT(A), who vide order dt.09.07.2018 (in

appeal No.87/2017-18) dismissed the appeal of the assessee. Aggrieved

by the order of Ld.CIT(A), assessee is now in appeal and has raised the

following grounds :

“1. The learned CIT (A) erred in dismissing the appeal of the assessee without appreciating the facts of the case and failed to give adequate opportunities.

to press ground No.1 and the only effective ground is 3(b).

Rs.34,36,000/- in the saving bank account of assessee.

4.1. AO has noted that information was received about the huge cash

deposits in assessee’s bank account. During the course of assessment

proceedings, on perusing the bank account of assessee maintained with

State Bank of India, Murud Janjira Branch, it was noticed that assessee

has made aggregate cash deposits of Rs.34,36,000/-. The assessee was

asked to explain the nature and source of cash deposits. Assessee inter-

alia submitted that assessee along with five other persons intended to

buy parasailing water boat for business purpose and for which five other

persons contributed the cash which was deposited in assessee’s saving

bank account with S.B.I. The details of person-wise contribution and the

date of cash deposits are noted by the AO in Page 4 of the assessment

order. With respect to the source of the deposits by those persons

assessee submitted that the amount was received by them through hand

loans. AO noted that the details of hand loans, names and address of

the persons from whom hand loan was raised, whether the hand loan

was returned by them or not etc. was not proved by the assessee. AO

also noted that as per the bills issued by Aquarius Fibereglas Pvt. Ltd.,

the boat was purchased by the assessee along with Shri Umesh

Sakharam Kasar and Shri Bharat Dashrath Belose. AO noted that the

purchase was thus only in the name of these three persons and not other

persons who stated to have contributed for the purpose of the boat. AO

concluded that the persons who stated to have been contributed amount

for the purchase of boat for business purpose were having meager

income and their creditworthiness was not proved. AO accordingly

considered the aggregate cash deposits of Rs.34,36,000/- as unexplained

cash deposits and made its addition u/s 69 of the Act. Aggrieved by the

order of AO, assessee carried the matter before Ld.CIT(A), who upheld the

order of AO.

Aggrieved by the order of Ld.CIT(A), assessee is now in appeal.

Ld.CIT(A). He further submitted that out of the total cash deposits of

Rs.34,36,000/-, Rs.25 lakhs are received by the assessee from outsiders,

whose names are listed by AO in Page 5 of the assessment order and the

balance amount is from assessee and other family members. He

submitted that with respect to the loan from outsiders, AO had passed a

penalty order u/s 271D of the Act on 22.12.2016 wherein on the amount

of loan of Rs.13 lakhs, he has levied penalty u/s 271D of the Act. He

therefore submitted that to the extent when the persons have been

identified to have given loans, addition u/s 68 of the Act is not

warranted. With respect to the balance addition which is from the

assessee and his family members, he relied on the submissions made by

the assessee before AO and Ld.CIT(A). Ld. D.R. on the other hand,

submitted that the penalty proceedings are separate and merely because

penalty has been levied u/s 271D of the Act on certain deposits, it

cannot be said that no addition u/s 68 of the Act is warranted. He thus

supported the order of lower authorities.

record. The issue in the present ground is with respect to addition of

cash deposits aggregating to Rs.34,36,000/- in assessee’s saving Bank

account maintained with SBI. It is the case of the assessee that he had

received loans aggregating to Rs.25 lakhs from outsiders for purchasing

of shipping boat for business purpose. It is also a fact that on such

cash deposits which have been received by the assessee, AO vide order

dated 22.12.2016 passed u/s 271D of the Act had levied penalty on

Rs.13 lakhs which is the unsecured loan to have been received by the

assessee by cash from those persons. In such a situation, I find force in

the argument of the Ld.A.R. that to the extent of Rs.13 lakhs, the parties

have been identified and no addition is warranted to that extent. With

respect to the balance amount, no plausible information has been

furnished by the Ld.A.R. and nor was he in a position to controvert the

findings of AO and Ld.CIT(A). I therefore direct the deletion of addition to

the extent of Rs.16,50,000/- and the balance amount of addition is

confirmed. Thus, the ground of the assessee is partly allowed.

Order pronounced on 16th day of October, 2019.

/- Sd/- (ANIL CHATURVEDI) लेखा सद�य / ACCOUNTANT MEMBER

पुणे Pune; �दनांक Dated : 16th October, 2019. Yamini

आदेश क� ��त�ल�प अ�े�षत/Copy of the Order forwarded to :

आदेशानुसार/ BY ORDER

// True Copy //

व�र�ठ �नजी स�चव / Sr. Private Secretary आयकर अपील�य अ�धकरण ,पुणे / ITAT, Pune.