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Income Tax Appellate Tribunal, AMRITSAR BENCH, AMRITSAR (SMC
Before: SH. SANJAY ARORA
IN THE INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH, AMRITSAR (SMC) BEFORE SH. SANJAY ARORA, ACCOUNTANT MEMBER I.T.A. No. 255/Asr/2018 Assessment Year: 2014-15
Vikas Arora, vs. Income Tax Officer, 1883/VIII-16 Ward 2(3), Amritsar Opposite Plot No. 164, Shakti Nagar, Amritsar [PAN: ACEPA 9950B] (Appellant) (Respondent)
Appellant by : Sh. Raj Kumar Arora, Adv. Respondent by: Sh. Charan Dass (D.R.) Date of Hearing: 14.02.2019 Date of Pronouncement: 15.02.2019
ORDER Per Sanjay Arora, AM: This is an Appeal by the Assessee directed against the Order by the Commissioner of Income Tax (Appeals)-1, Amritsar ('CIT(A)' for short) dated 05.02.2018, partly allowing the assessee’s appeal contesting his assessment u/s. 143(3) of the Income Tax Act, 1961 ('the Act' hereinafter) dated 27.12.2016 for the Assessment Year (AY) 2014-15.
The appeal raises a single issue, i.e., the sustainability of the addition in the sum of Rs.1,65,000/-, being the amount credited in the assessee’s saving bank account with Oriental Bank of Commerce, Amritsar Chowk, Amritsar (‘OBC’ for short) on 03.4.2013, as unexplained, i.e., in the facts and circumstances of the case.
2 ITA No. 255/Asr/2018 (AY 2014-15) Vikas Arora v. ITO 3. The brief facts of the case are that the assessee is a dealer in confectionary items, selling goods of various companies, viz. Brittania. The impugned deposit, received by cheque, was explained to be an advance from one, Harish Kumar, stated to be an employee of a supplier, Ferraro India Pvt. Ltd., against purchase of goods, and to whom sales were accordingly made. As, however, the address of the creditor, Harish Kumar, or his ledger account (in the books of the assessee), was not furnished, the Assessing Officer (AO) treated the amount received as unexplained. In appeal, the assessee furnished the ledger account exhibiting sales to the depositor during the month of April, 2013 itself, for Rs.1.65 lacs, adjusting, thus, the entire advance amount (PB pg. 8). Confirmatory letter and Permanent Account Number (PAN) of the creditor, as well the copy of his HDFC bank account, i.e., on which bank the cheque was drawn, were also submitted (PB pgs. 4,5). The same, however, did not find favour with the ld. CIT(A) as the confirmation letter did not mention the creditor’s PAN. No details of the creditworthiness or of the goods purchased by him from the assessee had been furnished. The addition was accordingly confirmed (para 7(f) of the impugned order). Aggrieved, the assessee is in second appeal.
I have heard the parties, and perused the material on record. The ld. counsel for the assessee, Sh. Arora, would show that the PAN of Harish Kumar, creditor, is mentioned in his confirmation letter, which also bears his complete address. He, further, insisting that the ledger account of the depositor was also furnished before the first appellate authority, of which there is though no mention in the appellate order, the appellate record was called for, to find the same on record. The ld. CIT(A) has thus clearly committed an error when he states that the creditors’ PAN is not mentioned in his confirmatory letter, or no ledger account showing sale of goods by the assessee had been furnished (at para 7(f) (supra)). Further, if he
3 ITA No. 255/Asr/2018 (AY 2014-15) Vikas Arora v. ITO entertained any doubt with regard to the sale entries, he ought to have required the assessee to furnish the relevant bills or other details, viz. transportation, etc., toward establishing the said sale. The copy of the bank account of Sh. Harish Kumar proves his identity as well as capacity, inasmuch as the build- up of the balance is gradual and from explained sources. As, however, the ledger account furnished (PB pg. 8) was in the books of M/s. Chaitanya Enterprise (outside Bhagtanwala Gate, Amritsar), Sh Arora was asked during hearing about the relationship between the assessee and the said firm. He explained it to be the assessee’s proprietary concern, the business income of which has been returned and assessed. Copies of the assessee’s return (computation of income) reflecting income from M/s. Chaitanya Enterprises, as well as the profit and loss account of the said firm, signed by Sh. Vikas Arora as proprietor, were submitted in evidence (copy on record).
I, under the circumstances, have no reason not to accept the assessee’s stand of the impugned credit in his books of account as being satisfactorily explained. I decide accordingly.
In the result, the assessee’s appeal is allowed. Order pronounced in the open court on February 15, 2019 Sd/- (Sanjay Arora) Accountant Member Date: 15.02.2019 /GP/Sr. Ps. Copy of the order forwarded to: (1) The Appellant: Vikas Arora, 1883/VIII-16, Opposite Plot No. 164, Shakti Nagar, Amritsar (2) The Respondent: Income Tax Officer, Ward 2(3), Amritsar (3) The CIT(Appeals)-1, Amritsar (4) The CIT concerned
4 ITA No. 255/Asr/2018 (AY 2014-15) Vikas Arora v. ITO (5) The Sr. DR, I.T.A.T. True Copy By Order