MANISH LALWANI,MUMBAI vs. ITO 16(1)(2), MUMBAI

आयकर अपील सं/ (िनधा�रण वष� / Assessment Year: 2009-10) बनाम/ Shri Manish Lalwani Income Tax Officer 16(1)(2) 14, Jalan House, 52, Mumbai Vs. Walkeshwar Road, Mumbai – 400 006 �थायी लेखा सं./जीआइआर सं./PAN/GIR No. : AASPL9747R (अपीलाथ� /Appellant) (��थ� / Respondent) .. Assessee by: Shri Haresh P. Shah Revenue by: Shri Rajguru M. V. सुनवाई की तारीख / Date of Hearing: 24.03.2017 घोषणा की तारीख /Date of Pronouncement: 29.03.2017 आदेश / O R D E R PER AMARJIT SINGH, JM:

The assessee has filed the present appeal against the order dated 31.12.2013 passed by the Commissioner of Income Tax (Appeals)-27, Mumbai [hereinafter referred to as the “CIT(A)”] relevant to the A.Y. 2009-10.

ITA No.2759/M/2015 A.Y.2009-10 ought to have been properly construed and regard being had to facts of the case no such addition of Rs.12,35,002/- should have been made. Reasons assigned by him are wrong and insufficient to justify addition of Rs.12,35,002/- to the total income of the appellant.

2. The learned Commissioner of Income Tax (Appeals) erred in confirming disallowances made of Rs.5000/- out of Conveyance expenses and telephone expenses by the learned Assessing Officer. Provisions of the Act ought to have been properly construed and regard being had to facts of the case no such disallowances of Rs.5000/- should have been made.

3. The brief facts of the case are that the assessee filed the return of income on 13.01.2010 declaring total income to the tune of Rs.3,08,564/- for the A.Y.2009-10. The return was processed u/s.143(1) of the Income Tax Act, 1961 ( in short “the Act”). Thereafter, the case was selected for scrutiny under CASS. Notice u/s.143(2) of the Act was issued and duly served upon the assessee. Subsequently, notice u/s.142(1) of the Act was issued and served upon the assessee. The assessee derived his income from business and income from other sources. The business income was earned by way of brokerage, F&O profit, commission, interest on loan advanced etc. According to AIR information received, the assessee deposited cash in his Saving Bank Account of ICICI Bank, Opera House Bank of ITA No.2759/M/2015 A.Y.2009-10 Rs.21,03,002/- during the F.Y.2008-09. The assessee explained that he withdrew the said amount from the said bank firstly, thereafter redeposited the same, copy of bank statement was also filed. The peak amount was assessed to the tune of Rs.12,35,002/- which was added to the income of the assessee by treating as unexplained investment u/s.69 of the Act. The assessee was not satisfied of the said addition, therefore, filed an appeal before the CIT(A), who confirmed the said addition, therefore, the assessee has filed the present appeal before us.

ISSUE NO.1:-

4. Under this issue, the learned representative of the assessee has argued that the CIT(A) has erred in confirming the addition made of Rs.12,35,002/- u/s.69 of the Act because the assessee has explained each and every entry of cash withdrawal and deposited which was not verified by the authority and considered by the authority properly, therefore in the said circumstances the work of peak amount taken as unexplained is wrong against law and facts and is liable to be deleted. Hence the finding of the CIT(A) is liable to be set aside. It is also argued that the assessee has given the deposit and withdrawal statement which has not been considered by the authority below properly therefore in the said circumstances the addition on the basis of peak amount is liable to be set aside in accordance with law. However, the learned departmental representative has supported the order passed by the CIT(A) in question. With due regards to the contention raised by the learned representative of the parties and ITA No.2759/M/2015 A.Y.2009-10 perusing the record carefully, it is not in dispute that the assessee has given the withdrawal and deposit statement for the period w.e.f. 01.04.2008 to 31.03.2009 in which the deposit is to the tune of Rs.21,03,002/- and withdrawals is to the tune of Rs.28,95,000/-. On appraisal of the said statement we nowhere found any illegality and infirmity specifically in the circumstances when the authority has not arrived as this conclusion that the deposit is unexplained u/s.69 of the Act. The peak method would be applicable in case of negative cash in hand and it’s deposits. Withdrawal of an amount of Rs.28,95,000/- itself speaks about the cash in hand with the assessee who deposited the same in his bank account. The said entries have also been reflected in the accounts books which were not discredited by the Assessing Officer. Anyhow, this piece of evidence alongwith entries made in the cash books have not been properly considered while deciding the issue of the assessee. In view of the said circumstances we are of the view that this matter is required to be examined afresh by the Assessing Officer in the light of the evidence adduced by the assessee in accordance with law. Accordingly, we set aside the finding of the CIT(A) on this issue and direct the Assessing Officer to decide the matter afresh in view of the evidence adduced by the assessee in accordance with law by giving an opportunity of being heard. Accordingly, this issue is decided in favour of the assessee against the revenue.

ITA No.2759/M/2015 A.Y.2009-10 ISSUE NO.2:-

ISSUE NO.3&4:-