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Income Tax Appellate Tribunal, AHMEDABAD “SMC” BENCH, AHMEDABAD
Before: Ms. SUCHITRA KAMBLE
This appeal is filed by the Assessee against the order dated 16.12.2015 passed by the CIT(A)-4, Vadodara for the Assessment Year 2011-12.
The assessee has raised the following grounds of appeal :-
“1.0 The learned Commissioner of Income Tax (Appeals) erred in law and on facts has confirmed the additions of Rs.26,53,517/- on account of credit entries in the bank statement treating the same as undisclosed income without allowing any expenditure therefrom.
1.1 The learned Commissioner of Income Tax (Appeals) ought to have considered the details of expenses incurred to earn the commission income of Rs.26,53,517/- which have not been considered while completing assessment proceedings.
The appellant prays that the expenditure incurred for earning such income may be allowed and the total income under this head deserves to be restricted to that offered by the appellant during the course of assessment proceedings.
Page 2 of 4 2.0 The learned Commissioner of income Tax (Appeals) erred in law and on facts has confirmed the additions of Rs.54,792/- on account of interest income without considering the fact that the interest income belongs to the appellant’s wife.
2.1 The Commissioner (Appeals) brushed aside the explanation that the interest income of Rs.54,792/- belongs to appellant’s wife. This interest is received on account of prematurity of Fixed Deposits which can be verified from the form 16A issued by the bank on deductions of the TDS from the same. The proceeds of the same have been deposited in the appellant’s bank account because his wife is joint holder in bank account. The copies of Form 16A issued in the name of the appellant are enclosed in Annexure-IV.
The appellant, therefore, prays that additions made on account of interest income may be deleted.
3.0 The learned Commissioner of Income Tax (Appeals) erred in law and on facts has confirmed the initiation of penalty proceedings under section 271(1)(c) of the Income Tax Act, 1961 for the alleged concealment and/or furnishing of inaccurate particulars of income.
4.0 The learned Commissioner of Income Tax (Appeals) has erred in law and on facts in confirming the charging of interest under section 234A, 234B and 234C of the Income Tax Act 1961.”
The assessee is an individual and engaged in the business of arranging the export sale for the clients. The assessee is also deriving income from salary and other sources and is regularly assessed to tax. The assessee filed return of income on 31.07.2011 declaring total income at Rs.6,24,470/-. The return was processed and accepted under Section 143(1) of the IT Act 1961. Subsequently, the case was selected for scrutiny and notice under Section 143(2) & 142(1) of the Act were issued. While compiling the information and details called for the scrutiny, the assessee noticed that the commission income on which TDS was also deducted was left to be declared in the income tax return. Accordingly, during the assessment proceedings revised computation of total income was submitted on 22.01.2014 computing the total income at Rs.11,62,000/-. The Assessing Officer completed the assessment under section 143(3) of the Act on 28.02.2014 thereby making addition of Rs.26,53,517/- related to commission income and Rs.54,792/- related to unreported interest.
Page 3 of 4 4. Being aggrieved by the assessment order, the assessee filed appeal before the CIT(A). The CIT(A) partly allowed the appeal of the assessee.
At the time of hearing none appeared on behalf of the assessee despite giving notice. There is no new address submitted by the assessee before the Tribunal. Hence, I am proceeding the matter in respect of submissions made before the Assessing Officer and before the CIT(A) which are quoted in Assessment Order and the order of the CIT(A) respectively.
The Ld. DR submitted that the CIT(A) has observed that no details or evidence was filed before the Assessing Officer as well as before the CIT(A). Therefore, the addition related to Rs.26,53,570/- has been confirmed by the CIT(A). Ld. DR relied upon the order of the CIT(A) and the order of the Assessing Officer.
I have heard the Ld. DR and perused all the relevant material available on record. From the perusal of the submissions quoted in paragraph no.4.2 of the order of the CIT(A) it can be clearly set out that the assessee has received commission income for arranging the export sales for one client namely M/s. Raviraj Foils Limited, Sanand. The amounts have been deposited in the Bank after deduction of tax at source. Thus, the commission income was genuine income and related documents were also produced before the Assessing Officer as well as before the CIT(A) which was not taken into account by both the authorities. Hence, the addition made by the Assessing Officer does not sustain. Appeal of the assessee is therefore allowed.
In the result, appeal of the assessee is allowed.
Order pronounced in the open Court on this 16th day of November, 2022.