VIJAY KUMAR CHANDESHWAR YADAV,NAVI MUMBAI vs. ITO(28)(3)(4), VASHI, NAVI MUMBAI

Per Amarjit Singh (AM):

This appeal filed by the assessee is directed against the order passed by the Id. CIT(A) NFAC for A.Y. 2014-15. The assessee has raised

the following grounds before us:

«7,

As per Section 68 of Income Tax Act 1961, any Cash credit which remains unexplained to the extent of satisfaction of AO shall be taxable. However, we have given explanation to AO and CIT(A) regarding the amount not shown in ITR as Turnover that it was unintentionally left to be shown while filing the ITR and it is purely a business transaction. Here, the AO & CIT(A) have approached a biased approach-Indore Malwa United Mills Ltd v/s. State of Madhya Pradesh [1966] 60 ITR 41 (SC).

As per section 44AD of Income Tax Act 1961, a specified business person can opt for presumptive taxation scheme and can file his return of income under this section by showing approximate turnover and profit will be declared above than a specified percentage (%) mentioned in this section. If the assessee is filing ITR under this section, then he cannot claim further expenditure except certain expenses under chapter VIA of Income Tax Act 1961. However, in the present case, the assessee is a labour contractor and thus he does fall in the specified business category mentioned in section 44AD of Income Tax Act 1961. Hence, there is no limit to claim amount of expense in this case. However, in our case, the expenses can be claimed by filing revised ITR u/s 139(5) of Income Tax Act 1961 but the time limit of filing this revised ITR has been expired and so we could not file the revised ITR.

4, In our case, the AO has accepted our original ITR filed u/s 44AD dated 14.11.2014 wherein Net Total Returned Income declared by us was Rs.2,20,419/- However, the AO has further added Rs.26,25.610/- in his Assessment Order dated 04.11.2016 wherein it was mentioned by AO that this is the Bank Turnover which was left by mistake while filing the original ITR dated 14.11.2014 Against this order, we filed an Appeal to CIT on 02.12.2016 and requested to CIT(A) to accept the revised computation made by us wherein we requested to accept the related expenses to the tune of Rs.21,06,616/- and the resultant Net Taxable Income was Rs.5,18,997/-. However, on 06.06.2023, CIT(A) has quashed our request and dismissed the appeal and confirmed the Tax demand order passed by the respective AO to the tune of Rs. 10, 12,400/- without considering our additional evidences submitted u/s 246A. We therefore, hereby requesting to the ITAT to accept our additional evidences u/s 246A and grant a relief to us.

age [3 he course of assessment on the basis of AIR information the assessing officer noticed that assessee had deposited cash of Rs.51,90,000/- in his bank account maintained with State Bank of India. On perusal o: he bank statement the assessing officer found that assessee has deposited an amount of Rs.19,51,434/- by cash and cheques in his saving bank account maintained with State Bank of India and Rs.30,35,491/- in his bank Account maintained with Central Bank of India. Since the amount deposited in the bank account of Rs.49,86,925/- was exceeding the total gross receipts of Rs.25,81,730/-

credited to the profit and loss account, therefore, assessing officer asked he assessee to reconcile the amount deposited in his bank account with he gross receipt credited in the trading account. In response the assessee filed revised statement of Income showing new additional urnover of Rs.24,05,195/- vide letter dated 3.11.2016. The assessee had also claimed corresponding expenses of Rs.21,06,616/- and shown

further income of Rs.2,98,578/-. He submitted that undisclosed bank

ransactions were unintentionally remained to be disclosed in the Income Tax return and same have been taken into account in the revised statement of income. However, the assessing officer has not agreed with the submission of the assessee he was of the view that return of income can only be revised any time before the expiry of one

year from the end of the relevant assessment year, since the last date

for filing of revised return u/s 139(5) of the Act had already been expired on 31.03.2016, therefore, stated that said return cannot be revised. The assessing officer further stated that assessee had not disclosed the income as per provision of Sec. 44AD of the Income Tax Act, therefore, the expenses pertaining to the undisclosed receipt cannot be allowed. The assessing officer further stated that assessee has also not proved that amount deposited in the bank accounts was from his business

income, therefore submission of the assessee was rejected and whole

age |4 amount of Rs.24,05,195/- was added as unexplained cash credit u/s 68 of the Act.

has dismissed the appeal of the assessee.

book and their explanation that amount deposited in the bank accounts

was pertaining to the normal course of business activities of the assessee. He further submitted that ld. CIT(A) has neither rejected the additional evidences as provided under Rule 46A of the Income Tax Rules nor considered the same before dismissing the appeal filed by the assessee.

authorities.

However, the AO has added the whole amount of turnover of age |S Rs.24,05,196/- to the total income of the assessee without giving any deduction to the corresponding expenses claimed by the assessee in his revised statement of income. On perusal of the material placed on record we consider that the claim of the assessee that amount deposited in the bank account was out of his normal business activities was not examined and verified at the level of lower authorities. The assessee has filed relevant documentary evidences before the ld. CIT(A) as additional

evidences explaining that the transactions reflected in the bank accounts were related to the normal business activities of the assessee. However, the ld. CIT(A) has not dealt with additional evidences filed by the assessee as prescribed under Rule 46A of the I.T. Rule. In view of the above facts and circumstances we restore this case to the file of the assessing officer for deciding afresh after verification of the relevant supporting documents in support of his claim that new receipt shown cannot be effected without incurring the corresponding expenses in the normal course of business. Therefore, the appeal of the assessee is allowed for statistical purposes.

purposes.

Order pronounced in the open court on 17.05.2024 (Vikas Awasthy) (Amarjit Singh) Judicial Member Accountant Member

Place: Mumbai

Date 17.05.2024 Rohit: PS ae ot vrata STOfYA/copy of the Order forwarded to:

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orttenelf / The Appellant

weet / The Respondent.

STARR AGH / cir faurtta oferta, sraez sich sft pr, rear, Mumbai m™é wea / Guard file. weattd ofa ////

/ BY ORDER,

SU/ Me usiter (Dy./Asstt. Registrar) omar atteia siftrepzur rrat, Bench,

Mumbai.