SIDDIQUE A.A. CHOWDHARY,MUMBAI vs. ITO 21(3)(2), MUMBAI

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ITA 1795/MUM/2013Status: DisposedITAT Mumbai02 September 2016AY 2009-103 pages
AI SummaryPartly Allowed

What did the Tribunal hold?

The Tribunal dismissed the Revenue's appeal due to low tax effect. For the assessee's appeal, the issue was restored to the Assessing Officer for fresh examination of the cash book.

What were the facts?

The assessee, engaged in selling used computer parts, made cash deposits in bank accounts. The Assessing Officer added the entire deposits as income for lack of a date-wise cash flow statement. The CIT(A) allowed a partial deduction.

What were the issues?

Whether the cash deposits in the bank account were sufficiently explained by the assessee's sales proceeds. Whether the assessee's failure to provide a date-wise cash flow statement justified the addition of the entire deposits.

Which sections of the Income-tax Act were involved?

Section 68

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “E” Bench, Mumbai

Before: Shri Mahavir Singh (JM) & Shri B.R. Baskaran (AM)

For Appellant: Shri M. Subramanian
Hearing: 30.8.2016Pronounced: 2.9.2016

Heard together (2 matters)

I.T.A. No. 1795/Mum/2013
I.T.A. No. 1902/Mum/2013

Read from the judgment's own cause title. This page is filed under one of them.

O R D E R Per B.R. Baskaran (AM) :-

These cross appeals are directed against the order dated 5.12.2012 passed by learned CIT(A)-32, Mumbai and they relate to A.Y. 2009-10.

2.

Addition of cash deposits made by the Assessing Officer, having been partially confirmed by learned CIT(A), both the parties are in appeal before us.

3.

Facts relating to the issue are stated in brief. The assessee is engaged in the business of selling used computers and computer spare parts. The Assessing Officer noticed that the assessee had made cash deposits of `

2 Shri Siddique Ahmed Abbasali Chowdhary 10,42,503/- and ` 7,00,000/- respectively in the savings bank account maintained with ICICI Bank and DCB Bank. The assessee explained that these cash deposits have been made out of sale proceeds of computer scrap sold on cash basis. The assessee also furnished a statement of monthly cash summary, sales and purchase. However, the Assessing Officer asked the assessee to give date-wise cash flow statement but the same was not provided. Hence, the Assessing Officer added the entire cash deposits of ` 17,42,503/- as income of the assessee. Learned CIT(A) gave deduction of cash sale amount of ` 5,57,743/- and accordingly confirmed the remaining addition of ` 11,99,360/-. Both the parties are aggrieved with the decision rendered by learned CIT(A).

4.

At the time of hearing, it was pointed out that the tax effect involved in the appeal of the Revenue is less than ` 10,00,000/- and hence the Revenue is precluded from pursuing this appeal, vide Circular No. 20/2015 dated 10.12.2015. We find merit in the said submission and accordingly, we dismiss the appeal filed by the Revenue in limine.

5.

With regard to the appeal filed by the assessee, learned AR submitted that the assessee has since prepared day-to-day cash book and entire deposits made in the bank account stands explained in this cash book.

6.

Learned Departmental Representative, on the contrary, submitted that the assessee has not produced this cash book before the Assessing Officer and hence it requires examination.

7.

We have heard the rival contentions and perused the record. We have earlier noticed that the Assessing Officer has made addition only on the reasoning that the assessee could not furnish date-wise cash flow statement. Now, learned AR submits that the assessee has since prepared the same by way of cash book. Hence, in the interest of natural justice, we are of the view that the cash book prepared by the assessee requires examination at the end of the Assessing Officer. Accordingly, we restore the issue contested by the 3 Shri Siddique Ahmed Abbasali Chowdhary assessee to the file of the Assessing Officer with the direction to examine afresh by duly considering the cash book prepared by the assessee and take appropriate decision in accordance with law, after providing adequate opportunity of being heard to the assessee.

8.

In the result, appeal filed by the assessee is allowed for statistical purposes and appeal of the Revenue is dismissed.

Order has been pronounced in the Court on 2.9.2016

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