SUSHANTA KUMAR PAL,NADIA vs. ITO, WARD - 41(4), NADIA, NADIA

The assessee is an individual and is in the business of trading in seeds, jute and fertilizers. He also has income from transport business. He filed his return of income on 18/09/2012, disclosing total income of Rs.1,97,510/-. The Assessing Officer passed an order u/s 143(3) of the Act, determining the total income at Rs.25,04,750/-, interalia making an addition on account of unexplained receipts, expenditure from undisclosed sources, undisclosed income and introduction of cash from unexplained sources. Aggrieved the assessee carried the matter in appeal. The ld. First Appellate Authority, granted part relief.

Further aggrieved, the assessee is before us in appeal on the following grounds:- “1. FOR THAT the Ld. Commissioner of Income Tax (Appeals)-12. Kolkata failed to consider that none of the conditions precedent existed for and/or were fulfilled by the Ld. Income Tax Officer. Ward 41(4), Nadia for his purported action of resorting to the specious addition of Rs. 16,56,022/- on Assessment Year: 2012-13 Sushanta Kumar Pal account of alleged income from unexplained sources indulging in speculation, surmise, suspicion and conjecture and the spurious addition upheld that account is therefore ab initio void, ultra vires and ex -facie null in law.

Today, though nine matters were listed before the Bench, no Departmental Representative appeared. There was no application for adjournment either. The Bench re-assembled for a break, so as to enable the Department to depute a Departmental Representative. Despite waiting, there was no response. Hence I proceed to dispose off the case ex-parte on merits, qua the revenue. There is a delay of 11 days in filing of this appeal. After perusing the petition filed for condonation of delay, I am convinced that the assessee was prevented by sufficient cause from filing the appeal in time. Hence the delay is condoned and appeal admitted.

We have heard the contentions of the ld. Counsel for the assessee. On careful consideration of the facts and circumstances of the case, perusal of the papers on record, orders of the authorities below as well as case law cited, we hold as follows:- 6. Ground No. 1 & 2 are against the addition of Rs.16,56,022/-, on the ground that the assessee earned income from unexplained sources. The assessee explained that he sold wheat to one Mr. Raj Kumar Bhutika, amounting to Rs.36,69,728/-, during the Financial Year 2011-12 and that this is evidenced by the recordings in the books of accounts. Out of Rs.36,69,728/-, an amount of Rs.19,35,808/- was paid through NEFT/RTGS. The assessee claimed that the balance amount was deposited directly by Mr. Raj Kumar Bhutika in the bank account of the assessee. On an enquiry Mr. Raj Assessment Year: 2012-13 Sushanta Kumar Pal Kumar Bhutika, has denied the cash deposit. The assessee claims that this reply u/s 133 (6) cannot be relied upon for the reason that the sales in question were not doubted and the fact that Mr. Raj Kumar Bhutia owed money to the assessee was not doubted. He submitted that the assessee’s plea for cross-examination of Mr. Raj Kumar Bhutia has not been provided and hence the evidence in question cannot be acted upon. He further pleads that this amount has been disclosed as income by the assessee by way of cash sales and hence it cannot be added once again as it would amount to double addition. 6.1. We find that the Assessing Officer, on cross-examination of the books of accounts of the assessee, found that this amount in question was shown as cash sales by the assessee. Once the assessee disclosed its amount as an income from sales, the question of adding the same again as unexplained receipt does not arise. The purchase and sales and the closing stock disclosed by the assessee have been accepted by the Assessing Officer. The books have not been rejected. Under these circumstances, the addition made, in my opinion is bad in law. In the result Ground No. 1 & 2 are allowed.

Ground No. 3, is against the addition of Rs.36,379/-. This addition has been made on the ground that there is a variation in the quantitative details furnished by the assessee. The assessee explains that there was a mistake in making particular entry and had submitted a fresh reconciliation. The Assessing Officer was not convinced and made the addition. 7.1. After hearing rival contentions, I concur with the findings of the Assessing Officer. The assessee has not been able to controvert these findings of the Assessing Officer. Hence, this ground of the assessee is dismissed.

In the result, this appeal of the assessee is allowed in part.