SHARAD JANARDAN BHAVAR,AHMEDNAGAR vs. INCOME-TAX OFFICER, WARD 1, AHMEDNAGAR

PDF · subscribers
ITA 623/PUN/2020Status: DisposedITAT Pune01 August 2022AY 2015-164 pages
AI SummaryPartly Allowed

What did the Tribunal hold?

The Tribunal held that the addition should be restricted to the excess amount of Rs.92,435, which represents the difference between the addition made and the total income declared by the assessee. The AO's assumption of 2% commission on all bank deposits was not fully substantiated.

What were the facts?

The assessee had made a declaration under the Income Tax Declaration Scheme, which became ineffective due to non-payment of taxes. The AO treated bank deposits as gross receipts from cotton business and added 2% commission income. The CIT(A) sustained this addition.

What were the issues?

Whether the entire bank deposits can be treated as commission income, and if not, what portion of it is taxable as income.

Which sections of the Income-tax Act were involved?

Section 148

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, PUNE BENCH “SMC”, PUNE

Before: SHRI R.S. SYAL

For Respondent: Shri M.G. Jasnani

आदेश / ORDER

PER R.S.SYAL, VP : This appeal by the assessee is directed against the order passed by the CIT(A)-2, Pune on 16-09-2020 in relation to the assessment year 2015-16. 2. The only issue raised in this appeal is the confirmation of addition of Rs.3,33,195/-. 3. Briefly stated, the facts of the case are that the assessee had filed an application for declaration in Income Tax Declaration Scheme during 2016 before the Pr.CIT disclosing income for five years including the assessment year under consideration (Rs.15,099).

Since due taxes were not paid, the declaration became ineffective.

1.

The Assessing Officer (AO) issued notice u/s.148, in response to which the assessee filed his return declaring total income of Rs.2,40,760/-. The AO observed that the assessee had deposited a sum of Rs.1,66,59,773/- in his bank account. Treating such amount as gross amount received by the assessee from cotton business, from which commission income was earned, the AO applied 2% rate of commission on such deposits of Rs.1.66 crore, thereby making the addition of Rs.3,33,195/-. The ld. CIT(A) sustained the same, against which the assessee has come up in appeal before the Tribunal.

4.

I have heard the learned DR and gone through the relevant material on record. There is no appearance from the side of assessee despite notice. It is seen that the only case made by the AO is the taxability of 2% commission income on gross amount deposited in the bank account at Rs.1.66 crore, which comes to Rs.3,33,195/-.

Nothing has been brought on record to show that the assessee had any other source of income as well. The assessee filed return declaring total income of Rs.2,40,760/-. In that view of the matter, the only excess amount of Rs.92,435/- (Rs.3,33,195 – Rs.2,40,760) ought to have been included in the assessee’s total income. I, therefore, restrict the addition to this extent.

5.

In the result, the appeal is partly allowed. Order pronounced in the Open Court on 01st August, 2022.

More judgments on Section 148

All 35,022 judgments and leading authorities on Section 148 →

Recent GST High Court judgments

Search GST case law →