THE ITO WARD - 2, GUDIVADA vs. KOGANTI POORNA CHANDRA PRASAD, GUDIVADA

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ITA 200/VIZ/2014Status: DisposedITAT Visakhapatnam07 April 2022AY 2009-105 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal found that the assessee failed to produce documentary evidence for the cash deposits and withdrawals. Therefore, the order of the CIT(A) was quashed.

What were the facts?

The assessee, an employee of Shriram Group, deposited a large sum of money in banks, claiming it was collected as insurance premium/NCDs on behalf of the company. The Assessing Officer disallowed the entire amount, but the CIT(A) deleted the addition.

What were the issues?

Whether the cash deposits made by the assessee were genuine collections on behalf of Shriram Group, and if sufficient evidence was provided to substantiate these claims.

Which sections of the Income-tax Act were involved?

Section 69,Section 69A

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, VISAKHAPATNAM BENCH, VISAKHAPATNAM

Before: SHRI DUVVURU RL REDDY, HON’BLE & SHRI S BALAKRISHNAN, HON’BLE

Hearing: 10.03.2022Pronounced: 07.04.2022

Per Shri Balakrishnan S, Accountant Member

1.

This appeal is filed by revenue against the order of the Commissioner of Income Tax (Appeals) [for short, “CIT(A)”], Vijayawada in Appeal No.384/CIT(A)/VJA/11-12 dated 28.02.2014 for the Assessment Year (A.Y.) 2009-10.

Koganti Purnachandra Prasad, Gudivada

2.

Brief facts of the case are that the assessee is deriving income from salary and commission, being an employee of Shriram Group of companies.

The assessee filed his return of income on 16.12.2009 declaring income of Rs.2,71,998/-. Subsequently, the case was selected for scrutiny under CASS and notices u/s 143(2) & 142(1) were served on the assessee. In response to the notices, the assessee’s authorized representative appeared before the Assessing Officer (AO) and furnished the documents as required in the questionnaire. The AO after verifying the bank statement and other statements produced before him found that the assessee has deposited an amount of Rs.1,67,27,827/- in various banks as listed in para 3.4 of the assessment order. The assessee’s representative explained that the amounts were collected on behalf of Shriram Group of Companies against insurance premium/NCDs and temporary receipt was issued to the subscribers by the assessee. Out of the above the AO also observed various cash deposits to the extent of Rs.63,79,880/- pertaining to others. After considering the submissions made by the assessee’s representative, the AO disallowed the sum of Rs.1,67,27,827/- u/s 69 r.w.s.69A of the Act.

Koganti Purnachandra Prasad, Gudivada

3.

Aggrieved by the order of the AO, the assessee preferred an appeal before CIT(A), Vijayawada. The Ld.CIT(A), after considering the written submission made by the assessee’s representative and on perusal of statement produced by the assessee as certified by Shriram Group of Companies concluded that the cash deposits pertain collections from various customers on behalf of Shriram Group of Companies and later on transferred to Shriram Group of Companies and does not relate to the assessee. He therefore, directed the AO to delete the addition of Rs.1,67,27,827/-.

4.

Aggrieved by the order of the Ld.CIT(A), the revenue is in appeal before the Tribunal and raised the following grounds :

1. The order of the Id. CIT(A) is erroneous on facts and in circumstances of the case.

2. The Id. CIT(A) failed to take cognizance of the fact that the cash deposits claimed to have been received from the customers of Shriram group of companies were not confirmed by the alleged customers & the assessee failed to produce even the addresses of them. 3. The Id. CIT(A) erred in deleting the entire addition of Rsd,67,27,8271- without examining the genuineness of the certificate issued by Shriram group of companies as the same was not signed by any authorised officer of the company & without there being any documentary evidence for the amounts given to persons from time to time at Rs.11,74,000/- & for the withdrawals from time to time at Rs.46,02,682/-. 4. The Id. CIT(A) failed to take congnizance of the fact that the financial transactions at Rs63,79,880/- not attributable to Shriram group of companies.

Koganti Purnachandra Prasad, Gudivada

5. The Id. CIT(A) failed to consider the submissions made by the A.O. in the remand report on 4/2/2014. - 6. Any other ground that may be urged at the time of hearing.

5.

The Ld.DR argued that the assessee failed to produce any documentary evidence with respect to cash deposits / withdrawals and amounts transferred to Shriram Group of Companies. The Ld.DR also argued that from the observation of the AO, it is noted that an amount of Rs.63,79,880/- is not attributable to Shriram Group of Companies. The Ld.DR pleaded that the order of the Ld.CIT(A) be quashed.

6.

None appeared before us on behalf of the assessee to represent his case. The assessee has also submitted written submissions before us.

7.

We have heard the contentions of Ld.DR and perused the documents and written submissions placed before us and also the orders of the authorities below. We do not find any merit in the written submissions made by the assessee. We also find force in the arguments of the Ld. DR that no documentary evidences were produced before the Ld. AO. In view of the above, we are of the opinion that the order of the Ld. CIT(A) be quashed and the appeal of the Revenue be allowed.

Koganti Purnachandra Prasad, Gudivada

8.

In the result, appeal of the Revenue is allowed.

Order Pronounced in open Court on 07th April, 2022. Sd/- Sd/- (दुव्िूरु आर.एऱ रेड्डी) (एस बाऱाकृष्णन) (DUVVURU RL REDDY) (S.BALAKRISHNAN) न्याययकसदस्य/JUDICIAL MEMBER ऱेखा सदस्य/ACCOUNTANT MEMBER Dated : 07.04.2022 L.Rama, SPS आदेश की प्रतितिति अग्रेतिि/Copy of the order forwarded to:- 1. रधजस्व/The Revenue – Income Tax Officer, Ward -2, Gudivada 2. ननधधाररती/ The Assessee– Sri Koganti Purnachandra Prasad, D.No.8-315- 3, 6th Lane, Rajendranagar, Gudivada 3. आयकर आयुक्त (अऩीऱ)/ The Commissioner of Income Tax (Appeals), Vijayawada 4. आयकर आयुक्त / The Commissioner of Income Tax, Vijayawada 5. ववभधगीय प्रनतननधध, आयकर अऩीऱीय अधधकरण, ववशधखधऩटणम/ DR,ITAT, Visakhapatnam 6.गधर्ा फ़धईऱ / Guard file

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