M/S. JYOTI ROADLINES,PUNE vs. INCOME-TAX OFFICER,

आदेश / ORDER

PER VIKAS AWASTHY, JM

This appeal by assessee is directed against the order of Commissioner of Income Tax (Appeals)-7, Pune dated 29.08.2016 for the assessment year 2008- 09.

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is engaged in transport business. The assessee filed return of income for the

assessment year 2008-09 on 12.08.2008 declaring total income of

Rs.1,27,820/-. The assessment u/s.143(3) of the Income Tax Act, 1961

(hereinafter referred to as ‘the Act’) was made on 09.12.2010 and the total

income of assessee was assessed at Rs.3,53,050/-. Thereafter, the case of the

assessee was re-opened and notice u/s.148 of the Act was issued to the

assessee. In reassessment proceedings, the Assessing Officer made addition of

Rs.9,00,000/- u/s.40A(3) of the Act.

r.w.s. 147 of the Act, the assessee filed appeal before the Commissioner of

Income Tax (Appeals). The Commissioner of Income Tax (Appeals) upheld the

findings of Assessing Officer and dismissed the appeal of assessee. Now, the

assessee is in second appeal before the Tribunal assailing the findings of the

Commissioner of Income Tax (Appeals) by raising following grounds :

“1. CIT(A) has erred in confirming the validity of reopening and also validity of Assessment u/s.143(3) r.w.s. 147/148, Appellant prays to declare the proceeding without jurisdiction and Assessment is bad in law. 2. CIT(A) has erred in confirming addition of Rs.9,00,000/- u/s.40A(3), same may please be deleted. 3. Appellant prays to cancel interest u/s. 234B, particularly by 234B(3) of the Act. 4. Appellant prays for just and equitable relief. 5. Appellant prays to add, alter, amend, modify and or withdraw the ground/s during the Appellant proceedings.”

outset that he is not pressing ground No.1 of the appeal. In respect of ground

No. 2, the ld. AR submitted that during the course of business operation,

assessee had issued bearer cheques in the name of his employees. These

3 ITA No.2681/PUN/2016 A.Y.2008-09

cheques were for withdrawal of cash from bank and not for making any

payments to any party/creditors. The cash withdrawal from bank was duly

recorded in the cash book on the respective dates. In the assessment

proceedings, the Assessing Officer has observed that cash has been withdrawn

from the bank for expenditure. However, the Assessing Officer failed to point

out any expenditure incurred by the assessee in cash. The ld. AR pointed that

before the Assessing Officer, cash book was produced and individual entries

were explained. However, the explanation of the assessee was not considered

and addition was made. The ld. AR furnished the copy of cash book for the

financial year 2007-08 and the Bank Statement. The ld. AR pointed that each

withdrawal from the bank has been recorded and the amount has been

debited in the cash book.

vehemently defended the impugned order and prayed for dismissing the

appeal of assessee being devoid of any merit.

ground No. 1 raised in appeal challenging reassessment proceedings, the ld.

AR stated at the Bar that he is not pressing ground No. 1. Thus, in view of the

statement made by the ld. AR ground No.1 raised in appeal is dismissed as

not pressed.

Rs.9,00,000/- u/s. 40A(3) of the Act. The addition has been made by the

Authorities below on presumption that bearer cheques issued by the assessee

in the name of employees is towards the payment beyond Rs.20,000/. The ld.

AR has drawn my attention to the cash book for the period 01st March, 2007

to 11th March, 2008. The ld. AR pointed that cash withdrawn from the bank

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has been debited to the cash book. After perusal of the entries in the cash

book, I am satisfied that the amount withdrawn by the assessee by issuing

bearer cheques in the name of his employees as mentioned in Para 3 of the

assessment order have been duly recorded in the cash book. The addition has

been made by the Authorities below merely on presumption and surmises.

The Revenue has not brought any evidence on record indicating that the

amount withdrawn from the bank has been utilized by the assessee for

making cash payments beyond Rs.20,000/-. Therefore, I am of the opinion

that addition made u/s.40A(3) is not warranted. Accordingly, the findings of

Commissioner of Income Tax (Appeals) on this ground are reversed and

ground No. 2 raised in appeal by the assessee is allowed.

interest u/s.234B. Charging of interest u/s.234B is consequential and

mandatory. Accordingly, ground No. 3 raised in appeal by the assessee is

dismissed.

requires no adjudication.

aforesaid.

Order pronounced on Friday, the 28th of September, 2018.

Sd/- (�वकास अव�थी /VIKAS AWASTHY) �या�यक सद�य/JUDICIAL MEMBER

पुणे / Pune; �दनांक / Dated : 28th September, 2018. SB

5 ITA No.2681/PUN/2016 A.Y.2008-09

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

अपीलाथ� / The Appellant. 1. ��यथ� / The Respondent. 2. 3. The CIT(Appeals)-7, Pune. 4. The CIT-6, Pune. 5. �वभागीय ��त�न�ध, आयकर अपील�य अ�धकरण, “एक-सद�य” ब�च, पुणे / DR, ITAT, “SMC” Bench, Pune. गाड� फ़ाइल / Guard File. 6.

// True Copy // आदेशानुसार / BY ORDER,

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