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Income Tax Appellate Tribunal, PUNE BENCH “SMC”, PUNE
Before: SHRI VIKAS AWASTHY, JM
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.
2 ITA No.2681/PUN/2016 A.Y.2008-09
The brief facts of the case as emanating from records are: The assessee
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.
Aggrieved by the assessment order dated 03.03.2014 passed u/s. 143(3)
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.”
Shri S. N. Puranik appearing on behalf of the assessee submitted at the
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.
On the other hand, Shri Sudhendu Das representing the Department
vehemently defended the impugned order and prayed for dismissing the
appeal of assessee being devoid of any merit.
Both sides heard. Orders of the Authorities below perused. In respect of
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.
In ground No.2 of the appeal, the assessee has assailed addition of
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
4 ITA No.2681/PUN/2016 A.Y.2008-09
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.
In ground No.3 of the appeal, the assessee has assailed charging of
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.
The ground No. 4 and 5 of the appeal are general in nature and hence,
requires no adjudication.
In the result, appeal of the assessee is partly allowed in the terms
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.