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Income Tax Appellate Tribunal, DELHI BENCH: ‘E’: NEW DELHI
Before: SHRI AMIT SHUKLA & SHRI ANADEE NATH MISSHRA
[A]. This appeal has been filed by the assessee against the impugned appellate order dated 30/01/2015 passed by Learned Commissioner of Income Tax (Appeals)-11, New Delhi, [“Ld. CIT(A)”,for short] pertaining to Assessment Year 2009-10. The Assessee has raised following grounds of appeal:-
“1. That the evidences furnished by the assessee apropos the sources of the funds to the tune of Rs. 32,75,000/-, ought to had been considered by the ld. CIT(A) and made the basis of the appellate order.
2. That the ld. CIT(A) had erred in arbitrarily rejecting the evidences furnished by the assessee on the ground that the notice u/s 133(6) issued to M/s Mahindra Enterprises had returned undelivered, thereby overlooking the facts that (i) the assessee has subsequently paid the purchase consideration to it through banking channel; and (ii) the postal authorities Page 1 of 17
ITA No.- 2402/Del/2015. Sh. Umesh Arora vs. ACIT remark was “addressee moved” and not that “no such party at this address”. 3. That on the facts of the case and under the law, the ld. CIT(A) had erred in disbelieving the explanation regarding source of the funds to the tune of Rs. 32,75,000/-. 4. That on the facts of the case and under the law, the ld. CIT(A) had erred in upholding the addition of Rs. 32,75,000/-, as arbitrarily made by the ld. AO.”
[B]. Vide Assessment Order dated 20/12/2011 passed by Assessing Officer (“AO”, for short) U/s 143(3) of the Income Tax Act, 1961 ( “I.T.Act” in short), income of the assessee was determined at Rs.67,21,750 (rounded off)/-. The relevant portion of the Assessment Order 20/12/2011 is reproduced as under:-
“The return of income for the assessment year 2009-10 was filed on 09.3.2010 declaring an income of Rs.34,21,610/- which was processed under section 143(1) on returned income. The case was selected for sciutiny under Cass as per guidelines/procedure for selection of cases for scrutiny.
Accordingly notice under section 143(2) was issued by ITO Ward 24(4), New Delhi on 20.8.2010 and served upon the assessee fixing for hearing on 03.9.2010. Thereafter case was transferred to this circle and my predecessor issued notices u/s 143(2) and 142(1) on 09.6.2011 calling for information on AIR and sources of income. Thereafter, after taking over the charge of this circle, the undersigned issued notices u/s 142(1.) on 03.11.2011 which was complied with. Shri Anoop Kumar Jairath. CA appeared on behalf of the assessee and the information called for has been filed and the same was verified and placed on records. -
The assessee is engaged in the business of rendering consultancy relating to Liaison consultancy services. The AR for the assessee appeared from time to time
ITA No.- 2402/Del/2015. Sh. Umesh Arora vs. ACIT as per entries in the order sheet. Accounts relating to the income produced/copies filed which were placed on records after verification.
The assessee was asked to file details of AIR information and in response to the same the assessee’s counsel filed reply during the course of hearing on 17.12.2011 on behalf of the assessee which is reproduced as under:
"Please refer to the AIR information provided by you of the Assessee. As per AIR assessee has deposited Rs. 27,75,000/- in his saving a/c with ICICI Bank. No. 003101000099 and HDFC Bank A/c No. 06511930000145. Assessee hereby admit that the amount mentioned above was undisclosed sale proceeds earned by the assessee during the course of its Business Activity. Assessee also admit that the investment in Birla Sun Life Mutual Fund for Rs. 5,00,000/- was also made out of the sale proceeds.
Assessee was also engaged in the business of trading of cloths. Assessee sold the cloths to the various petty street vendors. Copies of some sale and purchase bills alongwith bank statements are enclosed for your reference. Assessee also admits that he has earned approx. 4% to 5% profit on the sale. Assessee suomoto offer the said percentage of profit on sale for the taxable by the department.
The assessee has accepted that he was doing cloth selling business which was never disclosed in the return of Income. The amount of investment in the purchase of cloth has not been explained instead the amount earned out of sale of the cloth stated to have been deposited in the banks and in Birla Sun Life Mutual Fund. From the above facts it is established that the entire amount of deposit in the bank and mutual fund was his income from undisclosed sources. The assessee in his letter filed on through his counsel, has stated that he admits that he has earned approx., 4% to 5% profit on the sale. Assessee suomoto offer the said percentage of profit on sale for the taxable by the department. When confronted to explain the investment made in the purchase of cloth and the source of deposit in the banks and Birla Sun Life Mutual Fund amounting to Rs.27,75,000/- and Rs,5,00,000/- respectively, the counsel for the assessee could not explain any thing else except whatever stated in his letter. Page 3 of 17
ITA No.- 2402/Del/2015. Sh. Umesh Arora vs. ACIT 6. In view of the above,'it is held that the assessee was doing the business of sale of cloths to the petty vendors and the source of deposit/investment in the Bank/Mutual Fund and purchase of cloths has also not explained. The assessee vide his letter has himself accepted that the amount deposited in the Banks is out of undisclosed sale proceeds of cloth, and the deposit in Mutual Funds amounting to Rs.5,00,000/- is also from the sale proceeds of undisclosed cloth activities. The assessee could not explain the investment in purchase of cloth for sale and stated that sale proceeds have been deposited in the bank/mutual fund which is not acceptable. Hence the entire amount of Rs.27,75,000/- + Rs.5,00,000/- totaling Rs.32,75,000/- is considered assessee’s own income from undisclosed sources and the same is added in the income of the assessee as income from undisclosed sources. I am satisfied that assessee has concealed the taxable income by furnishing inaccurate particulars of his income, penalty proceedings under section 271 (l)(c) are initiated separately.
B.1] Aggrieved by the Assessment Order, the Assessee preferred appeal before the Ld. CIT(A). Vide aforesaid aforesaid impugned appellate order dated 30/01/2015, the Ld. CIT(A) dismissed the assessee’s appeal. The relevant portion of the order of the Ld. CIT(A) is reproduced as under:
ITA No.- 2402/Del/2015. Sh. Umesh Arora vs. ACIT ITA No.- 2402/Del/2015. Sh. Umesh Arora vs. ACIT ITA No.- 2402/Del/2015. Sh. Umesh Arora vs. ACIT ITA No.- 2402/Del/2015. Sh. Umesh Arora vs. ACIT ITA No.- 2402/Del/2015. Sh. Umesh Arora vs. ACIT ITA No.- 2402/Del/2015. Sh. Umesh Arora vs. ACIT ITA No.- 2402/Del/2015. Sh. Umesh Arora vs. ACIT ITA No.- 2402/Del/2015. Sh. Umesh Arora vs. ACIT ITA No.- 2402/Del/2015. Sh. Umesh Arora vs. ACIT ITA No.- 2402/Del/2015. Sh. Umesh Arora vs. ACIT
ITA No.- 2402/Del/2015. Sh. Umesh Arora vs. ACIT [C] This present appeal has been filed by the assessee against the aforesaid impugned appellate order dated 30/01/2015 of the Ld. CIT(A). At the time of hearing, Revenue was represented by Ms. Rakhi Vimal, the learned Senior Departmental Representative (“Ld. Sr. DR”, for short). However, none was present from the assessee’s side. In the absence of any representation from assessee’s side, at the time of hearing before us, we heard the Ld. Sr. DR; who relied upon the order dated 20.12.2011 of the Assessing Officer and the aforesaid impugned order dated 30.01.2015 of the Ld. CIT(A). After perusal of the materials on record, including the order of the AO and the aforesaid impugned order dated 30.01.2015 of the Ld. CIT(A), we find that the Ld. CIT(A) has passed speaking order on merits. Relevant portion of the impugned order of the Ld. CIT(A) has already been reproduced in foregoing paragraph [B.1] of this order. We find that the Ld. CIT(A) has given detailed reasons for his decision on merits in the aforesaid impugned appellate order dated 30.01.2015 of Ld. CIT(A). During appellate proceedings in Income Tax Appellate Tribunal (“ITAT”, for short) no material has been brought for our consideration to persuade us to take a view different from the view taken by the Ld. CIT(A) in the impugned order on merit.
After hearing the Ld. DR and after perusal of materials on record, and further, in view of the foregoing discussion, we decline to interfere with the aforesaid impugned appellate order dated 30.01.2015 of Ld. CIT(A).
[D] In view of the foregoing discussion, the appeal filed by Assessee is dismissed.
Before we part; we explicitly clarify that the assessee will be at liberty to approach ITAT for restoration of the appeal in accordance with Proviso to ITA No.- 2402/Del/2015. Sh. Umesh Arora vs. ACIT Rule 24 of Income Tax (Appellate Tribunal), Rules, 1963. If the assessee does approach ITAT for restoration of the appeal in ITAT, the matter will be considered in accordance with law having regard to the facts and circumstances.
[E] In the result, appeal filed by Assessee is dismissed.
Order pronounced in the open court on 04/10/19