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Income Tax Appellate Tribunal, “SMC-A” BENCH : BANGALORE
Before: SHRI ARUN KUMAR GARODIA
O R D E R
Per Shri A.K. Garodia, Accountant Member
This appeal is filed by the assessee which is directed against the order of ld. CIT(A) – 7, Bangalore dated 11.10.2017 for Assessment Year 2012-13.
2. The grounds raised by the assessee are as under.
“1. The order of the Commissioner of Income Tax (Appeals) is erroneous on the facts and in the law. On the facts and in the circumstances of the case he ought not to have dismissed the appeal.
The order of assessment made u/s 143(3) r.w. section 147, is without jurisdiction and , therefore, liable to be annulled.
3. The AO and CIT(A) erred on facts and in law in making addition of Rs.4,13,448/- , since it is clearly explainable and there is no provision under the law to tax the same.”
The learned AR of the assessee reiterated the submissions made before CIT (A). The ld. DR of revenue supported the order of CIT(A). I have considered the rival submissions and gone through the orders of authorities below.
Ground nos. 1 and 2 are in respect of validity of reopening, I find no infirmity in the order of CIT(A) on this aspect.
Regarding ground no. 3, I find that this issue has been decided by CIT(A) by making following observations on page nos. 5 and 6 of his order. The relevant para 6 of this order is reproduced hereinbelow.
“6. As regards the addition of Rs 4,13,448 by the AO as unexplained investment, the appellant submitted that the source of this cash deposit is opening cash balance of Rs 1,75,831 as on 01-04-2011 and sale of gold ornaments of Rs 3,31,500 in May 2011. It was submitted that the appellant has been filing return of income regularly and copies of acknowledgements of return for AY 2010-11 to 2012-13 were filed. The appellant also filed statement of income and balance sheet prepared in separate sheets. The acknowledgement of returns show that the appellant has filed returns in form ITR-4 electronically. This return form contains schedules for balance sheet, profit and loss account and computation of income which are required to be filled in by the taxpayer. Hence, a copy of the return filed by the taxpayer would show the actual details filed in the return with the income tax department. But, the acknowledgement(ITR-V) only mentions about gross total income, deductions u/c VI A, Total income and details of tax payment. Veracity of the documents balance sheet and computation of income prepared in separate sheets (not part of ITR-4 filed electronically) cannot be ascertained. No other supporting evidence has been brought on record by the appellant to prove its claim. Therefore, it is held that the appellant has not been able to explain the source of the cash deposit of Rs 4,13,448. Therefore, addition by the AO u/s 69 of the Act is upheld. Consequently, this ground of appeal of the appellant fails.”
6. From the above Para reproduced from the order of CIT(A), it is seen that the source of cash deposit is explained by the assessee by stating that there was opening cash balance of Rs. 1,75,831/- as on 01.04.2011 and there was sale of gold ornaments of Rs. 3,31,500/- in May 2011. Total of both these amounts is more than the amount of addition made by the AO of Rs. 4,13,448/-. The return of income for the present year was filed by the assessee on 15.07.2012, copy of which is available on page no. 41 of the paper book. As per this return of income, there is gross total income shown at Rs. 1,58,219/-. The computation of income for this assessment year is available on pages 39 & 40 of the paper book and as per the same, the assessee has declared business
income of Rs. 1,06,367/- and income from other sources of Rs. 680/-. The details of short term capital gain is also given on the same page as per which, there is sale consideration of capital asset on 23.05.2011 of Rs. 3,31,500/- and after deducting cost of acquisition of Rs. 2,80,328/-, short term capital gain was worked out at Rs. 51,172/-. The balance sheet for the preceding year i.e. year ending on 31.03.2011 is available on page no. 45 of the paper book and as per the same, there was cash in hand as on 31.03.2011 of Rs. 1,75,831/- and as per the order of CIT(A) reproduced above, it is noted by CIT(A) that assessee has filed statement of income and balance sheet prepared in separate sheets and the acknowledgment of returns show that the assessee has filed returns in form ITR-4 electronically. To this extent, there is no difference in the explanation of assessee and finding of CIT(A). Thereafter the CIT(A) says that this return form contains schedules for balance sheet, profit and loss account and computation of income whichare required to be filled in by the taxpayer and hence, a copy of the return filed by the taxpayer would show the actual details filled in the return with the income tax department. But the acknowledgement (ITR-V) filed before him only mentions about gross total income, deductions u/c VIA, total income and details of tax payment. He has held that the veracity of the documents i.e. balance sheet and computation of income prepared in separate sheets not part of ITR-4 filed electronically and under these facts, veracity cannot be ascertained and on this basis, he has rejected the explanation of the assessee.
In my considered opinion, when the assessee has given copy of ITR-5, the copy of return filed by the assessee could have been procured by the CIT(A) from the AO if he had any doubt about the computation, balance sheet etc. filed by assessee before him. Moreover, as per the balance sheet & computation available in the paper book, it is seen that there was opening cash balance of Rs. 1,75,831/- as per the balance sheet as on 31.03.2011 and as per the computation income or the present year, there is sale consideration of gold ornaments of Rs. 3,31,500/- and total of both these amounts of Rs. 3,31,500/- and Rs. 1,75,831/- is more than the amount of cash deposit by assessee in bank of Rs. 4,13,448/- and under these facts, the addition made by the AO and confirmed by the CIT(A) is not justified. Hence I delete the same.
In the result, the appeal filed by the assessee is partly allowed.
Order pronounced in the open court on the date mentioned on the caption page.