DCIT CENTRAL CIRCLE-27, NEW DELHI vs. NRP PACKERS PRIVATE LIMITED, NEW DELHI

Ld. AR highlighted that Mr. Vikas Kansal has made surrender of Rs. 5 crores before the income tax department which includes the peak credit in the above bank account accounts and factual position to this effect is supported department and affidavit of Mr. Vikas Kansal. Ld. AR submitted that the surrender so made was spread over four assessment years starting from AY 2011-12 to AY 2014-15. 4.1 Thereafter, the assessment was completed u/s 147/143(3) vide order dated 26/12/2018 after making addition of Rs. 17,44,74,612/- u/s 69A being total credit in the bank account. 4.2 The assessee filed an appeal challenging the assessment order on the issue of assumption of juri iction u/s 147 as well as on merits of the addition on the ground that the deposit in the bank accounts have already been subjected to tax in the hands of Sh. Vikas Kansal who was operating these bank accounts for his business. The CIT(A) decided the appeal vide impugned and upheld the validity of reopening u/s 147 and further the addition of Rs. 17,44,74,612/- u/s 69A was reduced to Rs. 1,26,34,414/- being peak balance in the bank account. Additionally, an addition of Rs. 72,06,976/- was made by applying GP Rate @ 4.86% on total credit appearing in the bank accounts. The GP rate was based on regular books of account. The CIT(A) held that entire credit in the bank account cannot be treated as income in the hands of the assessee and as such the addition was made on account of peak credit as well as estimation of profit on total credit. 4.3 Thus both assesssee and revenue filed appeal before but subsequently appeal of the assesse was settled udner Direct Tax Vivas Se Vishwas Act, 2020 and was withdrawn. Thus what is left is appeal of revenue. 5. Now the case of ld.AR is that as the issue of deposit in the bank accounts as decided by CIT(A) has attained finality pursuant to exercise of option under DTVSV Act, 2020 by the assessee, the revenue cannot be allowed to reagitate the issue again as same would defeat the purpose of DTVSV Act. Secondly, as the transactions in the bank accounts held by the assessee company pertains to Mr. Vikas Kansal who has already owned and paid tax in respect of peak credit in these bank accounts, the addition in the hands of the assessee in respect of deposits in the very same bank accounts is unsustainable and tantamount to double addition. The CIT(A) having upheld addition based on peak credit as well as estimation of profit on total credits in the bank account, the issue raised in the appeal of the revenue is meritless. 6. Now what is material is that similar reasons were recorded in the case of M/s. VSS Sales as appearing at S. No. 11 & 12 of the above table and co- ordinate bench after taking note of the facts of the case and surrender made by Mr. Vikas Kansal dismissed the appeal of the revenue vide order dated 27/06/2024 in ITA No. 1271/Del/2020. The relevant finding of the is reproduced hereunder: “9. We have considered the material on record and submissions. It can be seen that the case of assessee is that these two accounts had entries out of the transactions relating to trading activities which the brother of assessee, Mr. Vikas Kansal, was carrying out and as such the deposits therein cannot be considered as income of assessee. 10. On considering the documents filed by the assessee, which include the copies of letters 09/01/2014 and 26/03/2014 filed with DDIT (Investigation), Noida containing annexure showing peak balance of bank accounts including the aforementioned bank accounts as part of surrender made during the course of survey action u/s 133A. Computation of income alongwith Form 26AS Showing details of tax paid on surrendered income which included peak balance of various bank accounts. Affidavit of the Mr. Vikas Kansal. Affidavit of the assessee Mr. Gaurav Jain it is established that Mr. Vikas Kansal has paid tax on peak balance relating to these disputed bank accounts, which were in the name of assessee. 11. The Id. DR could not dispute the factual position regarding correspondence of Mr. Vikas Kansal with investigation wing regarding surrender of income and evidence of payment of tax as appearing in Form 26AS. Though, she tried to rebut it by submitting that assessee has not placed on record that if the income disclosed by Mr. Vikas Kansal, included the credit entries of the two bank accounts of the assessee. We are of considered view that infact, the burden was on the Revenue to establish that the admissions made by Mr. Vikas Kansal about the fact the he was operating the two accounts was not adhered to by Mr. Vikas Kansal, and the income surrendered by him did not include the peak credit entries of these two disputed account. Despite being given opportunities during hearing by us, to call for report from field authorities, the Ld. DR could not controvert the documentary evidences placed by the assessee. Thus there was failure on the part of CIT(A) to have not considered this set of evidence. 12. Be that as it may, the assessee having chosen to settle the dispute under DTVSVS and paid taxes on the addition confirmed by the CIT(A), the dispute to that effect is fate accompli and has attained finality. However, keeping in mind the factual matrix of the case as discussed above, we do not find any merit in the appeal of the revenue as the issue raised therein would only lead to anomalous result, double taxation and unjust enrichment of the revenue as the credits in the two bank accounts have already been subjected to tax on two occasions i.e, first in the hands of Mr. Vikas Kansal, who had surrendered the peak balance of disputed two accounts and thereafter in the hands of the assessee, which though stood settled under VSVS. In fact, as per the reasons recorded and approval u/s 151, the income escaping assessment was considered at Rs. 53,20,266/-being peak balance of both the bank accounts and CIT(A) having confirmed the same, there remains no grievance as per the reasons recorded by the assessing officer himself and as such the order of CIT(A) does not call for any interference. Accordingly, the grounds raised by the revenue have no merit and are hereby dismissed.” 7. Ld. DR has tried to distinguish the acts of VSS Sales by submitting that AO had tallied the amount surrendered by Vikas Kansal in remand report. Now what is material is that reasons recorded in the case of assessee and M/s. VSS Sales as placed to PB Pg 3-5 and 8-10 are identical. In fact, after taking us through the copy of assessment order and CIT(A) order in the case of M/s. VSS Sales placed at PB Pg 11-61, ld. AR demonstrated that the assessment order and CIT(A) order in the respective cases are identically worded which clearly proves the parity of facts. Thus aforesaid reasoning in case of M/s. VSS Sales (prop. Gaurav Jain) fully and squarely covers the present appeal and thus grounds raised are not left with any substance and accordingly the appeal is dismissed.