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Income Tax Appellate Tribunal, ‘A’ (SMC
Before: SHRI MAHAVIR SINGH
आयकरअपील�यअ�धकरण, ‘ए’, �यायपीठ,चे�नई IN THE INCOME TAX APPELLATE TRIBUNAL, ‘A’ (SMC) BENCH : CHENNAI �ीमहावीर �सह, उपा�य� के सम� BEFORE SHRI MAHAVIR SINGH, VICE PRESIDENT
आयकरअपीलसं./I.T.A.1380/CHNY/2023 �नधा�रणवष�/Assessment year : 2012-2013 Shri. Ponnusamy Venugopal Vs. The Income Tax Officer, 96/1, Sri Krishna Complex, Ward 1(6) Trichy Main Road, Salem Mallur, Salem. [PAN AMIPP0819Q] (अपीलाथ�/Appellant) (��यथ�/Respondent) अपीलाथ�क�ओरसे/ Appellant by : Shri. P. Venugopal, Retd. ��यथ�क�ओरसे /Respondent by : Shri ARV Sreenivasan, Addl CIT सुनवाईक�तार�ख/Date of Hearing : 20.02.2024 घोषणाक�तार�ख /Date of Pronouncement : 20.02.2024 आदेश/ O R D E R This appeal by assessee is arising out of the order of the Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi in Order No.ITBA/NFAC/S/250/2023-24/1056676846 (1) dated 29.09.2023. The assessment was framed by the Income Tax Officer, Ward 2(5), Faridabad for the assessment year 2012--2013, u/s.147 r.w.s. 143(3) of the Income Tax Act, 1961 (in short ‘’the Act’) on 23.12.2019.
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The only issue in this appeal of the assessee is as regards to order of the ld. CIT(A) confirming the action of the ld. Assessing Officer partly restricting the addition of unexplained cash deposit of Rs.6,30,800/- out of the total cash deposit of Rs.12,61,600/-.
Brief facts of the case are that Department received information that assessee had deposited cash in his Indian Bank Account, Pannapatti Branch, Salem amounting to Rs.12,61,600/- during the year under consideration i.e. financial year 2011-2012. Assessee was asked to explain the source of cash deposits. Assessee explained that he is getting pension from army and also running Popular Indian Gas Services, Salem. He also filed his profit and loss account, capital account, 26AS and bank statements. According to the ld. AO assessee has not provided any documentary evidence regarding the source of cash deposits of Rs.12,61,600/- and hence he added the same to the returned income of the assessee as unexplained. Aggrieved, assessee filed an appeal before the ld. CIT(A). 4. The ld. CIT(A) after going into the facts of the case restricted the addition to Rs.6,30,800/- by observing in para 9 as under:- ‘’9. Further, the purchases also could not be properly accounted for. The appellant submitted that it was his initial year of business and hence no separate current account was there. The appellant states that Rs.9,10,000/- was from his past savings and earnings during the period. In view of facts and circumstances of the case, it would be reasonable if the disallowance of cash deposits is restricted to 50% at Rs.6,30,800/- as the appellant has not
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been able to collate and link the earnings of the capital introduced with the said cash deposits by giving any cogent evidence and further, the daily cash book was not furnished to verify the claim and also considering the fact that the sale value of commercial and domestic cylinders sale was not tallying with the stock statement. Reliance is placed on rationale held in the case of Attara Gas Service vs. CIT 50 taxmann.com 445 (Allahabad) (2014) wherein it was held that Section 44AB, read with section 271B of the Income-tax Act, 1961 - Compulsory Tax Audit Assessment year 1999-2000 Whether where assessee was appointed as a distributor on principal to principal basis for sale of gas cylinders to consumers, sale of gas cylinders was to be included in turnover of assessee and when turnover so computed exceeded Rs.40 lakh for relevant year, books of account were required to be audited under section 44AB - Held, yes [In favour of revenue]’’.
Aggrieved, assessee preferred an appeal before the Tribunal.
I have heard rival contentions and gone through facts and circumstances of the case. Shri. P. Venugopal, Retd Colonel, the assessee represented in person. Assessee explained that cash deposits made on twelve different days i.e. from 03.02.2012 to 24.03.2012 aggregating to Rs.12,61,600/- is on account of amount being the cost of one lorry load of gas cylinders which was repeatedly getting deposited on 12 times whenever it is required to get a demand draft to pay towards a lorry load of cylinders from IOC Ltd after selling the previously received load. Assessee explained that the said amount of Rs.12,61,600/- is constituted out of multiplication by a figure of 12 of the value of one lorry load of gas cylinders and it is a routine regular business of the assessee. Assessee in person explained that he has filed details of purchases made from Indian Oil Corporation amounting
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to Rs.30,30,334/- during that period i.e. sale and purchase details, bank accounts and stock statement. Assessee has filed complete details of extract before the ld. CIT(A). In my view amounts deposited by the assessee in bank account on various dates aggregating to Rs.12,61,600/- is nothing but sale proceeds of earlier one lorry load package of gas cylinders sold and it was repeated 12 times remitting the amount. Hence, cash deposit cannot be treated as unexplained and hence I delete the addition in entirety and allow the appeal of the assessee. 6. In the result, the appeal of the assessee in ITA No.1380/CHNY/2023 for assessment year 2012-2013 stands allowed. Order pronounced in the open court at the time of hearing on 20th day of February, 2024, at Chennai. Sd/- (महावीरिसंह ) (MAHAVIR SINGH) उपा��/VICE PRESIDENT चे�नई/Chennai �दनांक/Dated: 20.02.2024. KV आदेश क� ��त�ल�प अ�े�षत/Copy to: 1. अपीलाथ�/Appellant 2.��यथ�/Respondent 3..आयकर आयु�त/CIT 4.�वभागीय ��त�न�ध/DR 5.गाड� फाईल/GF