Bhawani Shankar Sharma, Jaipur vs Department Of Income Tax

Jh vkj-ih-rksykuh] U;kf;d lnL; ,oa Jh Vh-vkj-ehuk] ys[kk lnL; ds le{k BEFORE: SHRI R.P. TOLANI, JM & SHRI T.R. MEENA, AM

vk;dj vihy la-@ITA No. 546/JP/2011 fu/kZkj.k o"kZ@Assessment Year : 2007-08

The D.C.I.T. cuke Shri Bhawani Shankar Sharma, Circle-6, Jaipur. Vs. M-33, Income Tax- Colony, Durgapura, Tonk Road, Jaipur.

LFkk;h ys[kk la-@thvkbZvkj la-@PAN/GIR No.: AVNPS 1049 R vihykFkhZ@Appellant izR;FkhZ@Respondent

izR;k{ksi.k@C.O. No. 26/JP/2014 (Arising out of vk;dj vihy la-@ITA No. 546/JP/2011)

Shri Bhawani Shankar Sharma, cuke The D.C.I.T. M-33, Income Tax- Colony, Vs. Circle-6, Jaipur. Durgapura, Tonk Road, Jaipur.

LFkk;h ys[kk la-@thvkbZvkj la-@PAN/GIR No.: AVNPS 1049 R izR;k{ksid@Objector izR;FkhZ@Respondent

jktLo dh vksj ls@ Revenue by : Shri Ajay Malik (Addl.CIT) fu/kZkfjrh dh vksj ls@ Assessee by : None (Date was noted)

lquokbZ dh rkjh[k@ Date of Hearing : 26/11/2014 ?kks"k.kk dh rkjh[k@ Date of Pronouncement : 16/01/2015 2 ITA 546/JP/2011 & C.O. 26/JP/2014_ DCIT Vs Bhawani Shankar Sharma

vkns'k@ ORDER

PER: T.R. MEENA, A.M.

The appeal by revenue and cross objection by assessee arise

from the order dated 22/03/2011 of Ld. CIT (A)-II, Jaipur. Respective

grounds of appeal as well as C.O. are as under:-

Ground in Revenue Appeal.

"On the facts and in the circumstances of the case and in law, the Learned CIT(A) has erred in deleting the addition of Rs. 13,50,000/- made by the Assessing Officer on account of unexplained cash deposits in bank account treating the same as explained by allowing credit of cash withdrawn from the bank accounts of the assessee on earlier dates despite the fact that the assessee failed to explain reasons for such cash withdrawals and utilization of the same."

Grounds in Cross Objection "1. That on the facts and circumstances of the case, the learned CIT(Appeals) has confirmed the disallowance of all the expense @ 20% on ad hoc basis. The disallowance being arbitrary. The same may kindly be deleted.

2. (i) The learned CIT(Appeals) erred on facts and circumstances of the case confirm as Sum of Rs. 13,79,770/- on account of unexplained credits in the bank account.

(ii) That the learned CIT (Appeals) erred in not accepting the opening cash balance of the cash book, the addition confirmed by the CIT (Appeals) is totally arbitrary and bad in law.

3 ITA 546/JP/2011 & C.O. 26/JP/2014_ DCIT Vs Bhawani Shankar Sharma

3. That the learned CIT(Appeals) erred in confirming the addition of Rs. 12,02,500/- as unexplained cash credit in spite of the confirmation filed by the assessee and without calling the cash creditors.

4. The appellant craves to add, alter, amend or withdrawn any of the ground of appeal after, before or at the time of hearing of appeal."

2. With regard to sole ground of the revenue's appeal and ground

No. 2 and 3 of the assessee's C.O., the learned Assessing Officer

observed that the assessee had shown credit entry in his bank account

at Rs. 46,29,770/-. Out of this, a sum of Rs. 25,35,000/- was deposited

in cash on various dates. The Assessing Officer gave reasonable

opportunity of being on this issue but no explanation was filed by the

assessee. He further found that this credit entries included transfer and

clearing amount to the tune of Rs. 20,94,770/-. The assessee had

shown total sales of Rs. 19 lacs in his return. Accordingly, the balance

credit of Rs. 27,29,770/- are treated as unexplained and added to the

declared income of the assessee. Similarly the assessee had shown

unsecured loan of Rs. 12,02,500/-, no details of name and address or

amount were furnished by the assessee despite the repeated

opportunities of being heard were allowed by the Assessing Officer.

4 ITA 546/JP/2011 & C.O. 26/JP/2014_ DCIT Vs Bhawani Shankar Sharma

Therefore, the addition of Rs. 12,02,500/- was also made U/s 68 of the

Income Tax Act, 1961 (in short the Act).

3. Being aggrieved by the order of the Assessing Officer, assessee

carried the matter before the learned CIT(A), who had allowed the

appeal partly by observing that the assessee had two bank accounts,

one with Axis bank and another with Malviya Urban Cooperative Bank,

Jaipur. He analysed the cash withdrawals from both counts on date

wise and finally he confirmed the addition of Rs. 13,15,000/- made by

the Assessing Officer on account of cash deposited and addition of Rs.

64,770/- on account of opening cash in hand. Regarding addition made

by the Assessing Officer at Rs. 12,02,500/-, the learned CIT(A) had

confirmed the total addition by giving detail finding on page 14-15 of its

order after considering all the evidences produced by the appellant and

held that the assessee had failed to prove the genuineness of the

transaction and explained the creditworthiness of the creditors. Thus,

he confirmed 10 lacs on account of unsecured loan and remaining

credit of Rs. 2,02,500/- was stated to be on account of liability, which

was also alleged to be received from three companies, for which, no

confirmation and copy of bank account has been filed. He also

confirmed the addition of Rs. 2,02,500/-.

5 ITA 546/JP/2011 & C.O. 26/JP/2014_ DCIT Vs Bhawani Shankar Sharma

4. Now the Revenue is in appeal as well the assessee is in C.O.

before us. The learned D.R. vehemently supported the order of the

Assessing Officer. No one has appeared on behalf of the assessee even

notices were served to him.

5. We have heard the learned D.R. and perused the material on

record. We have also perused the order of the learned CIT(A), who

had analysed the cash deposited in the bank account and withdrawal

made on various dates in the both the accounts i.e. in Axix Bank and

Malviya Urban Cooperative Bank, Jaipur. There is no material on record

from either side to controvert the finding of the learned CIT(A),

therefore, we uphold the order of the learned CIT(A). Accordingly, the

appeal of revenue & C.O. on ground Nos. 2 and 3 of assessee are

dismissed.

6. The first ground of the assessee's C.O. is against confirming the

ad hoc disallowances @ 20% out of expenses. The learned Assessing

Officer observed that the assessee had shown total sale of Rs. 19 lacs

against which the assessee had claimed expensed under the head

salary at Rs. 6,58,500/-, wages at Rs. 3,36,000/- and conveyance at Rs.

78,753/- respectively. The learned Assessing Officer observed that as

per information available on the return, the assessee was mainly doing 6 ITA 546/JP/2011 & C.O. 26/JP/2014_ DCIT Vs Bhawani Shankar Sharma

job work. The total expenses debited in the P&L account at Rs.

10,73,253/-, which was found excessive, not supported with

documents/evidences, therefore, he disallowed lump sum amount @

20% at Rs. 2,14,650/-.

7. Being aggrieved by the order of the Assessing Officer, the

assessee carried the matter before the learned CIT(A), who had

confirmed the addition by observing that the assessee had been

provided sufficient opportunity to produce the books of account before

the Assessing Officer but he failed to produce the same and had not

established the genuineness of the expenses. Even before him, there

was no change in the behavior of the assessee. The books of account

were not produced alongwith vouchers before the learned CIT(A),

therefore, he held that trading result rejected by the learned Assessing

Officer is justified. The entire expenditure of Rs. 12,46,053/- claimed by

the assessee was paid in cash. The appellant had shown brokerage and

commission receipts of Rs. 19 lacs. However, no details of brokerage

and commission had been submitted by the appellant before him. The

appellant had shown commission income from M/s Aerens Builders Pvt.

Ltd., New Delhi. The ACIT, Circle-6, Jaipur, the Assessing Officer issued

summons to said company to furnish copy of assessee's ledger account 7 ITA 546/JP/2011 & C.O. 26/JP/2014_ DCIT Vs Bhawani Shankar Sharma

in its books of account, however, the payer had not been complied with

the summons. As per MOU dated 05/05/2006 signed between M/s

Aerens Builders Pvt. Ltd., New Delhi and assessee, the appellant had

received advance of Rs. 5 lacs by DD No. 817594 dated 05/05/2006

drawn on OBC, Nehru Place, New Delhi. The said DD had not been

deposited in the bank account of assessee with M/s Malviya Urban

cooperative Bank, Jaipur and the bank account with Axix bank, which

was opened later on i.e. 29/09/2006, therefore, it was sure that the

assessee was having another bank account, in which the said DD had

been deposited but did not want to disclose the bank account to the

Assessing Officer. Accordingly, he rejected the books, which was found

to be manipulated and fabricated document. There was no copy of

agreement for paying rent and rent receipt, had not been produced

before him even name of the land lord of tenanted property had not

provided to him. The appellant had not furnished the vouchers for

payment of Rs. 3,36,000/- in cash to Shri Harkesh Meena from whom

Innova car was taken on rent. The log book and details of travelling

from Jaipur to Bikaner and subsequent visits to village Chadwal and

Karmiser had not been submitted. There was no reason to pay the

salary in cash for Rs. 6,58,500/-. It is also not clear from the assessee 8 ITA 546/JP/2011 & C.O. 26/JP/2014_ DCIT Vs Bhawani Shankar Sharma

that salary claimed for employees were employed for full time or part

time. The telephone expenses of Rs. 74,637/- were not paid to BSNL or

other company but they have been allegedly paid to some 8 employees

and there is no evidence as to how they in turn have incurred telephone

expenses of Rs. 74,637/-. The assessee could not furnish any evidence

to controvert the finding give by the Assessing Officer in his assessment

order. Therefore, he confirmed the addition made by the Assessing

Officer.

8. Now the assessee is in C.O. before us but no reply alongwith

evidences were furnished by the assessee, therefore, we are of the

view to take decision on the basis of facts available on record. The

learned DR also argued that the assessee was always non-cooperative

and had not given full information of the business activities and

expenses to the lower authorities. Therefore, the same may be

confirmed.

9. We have heard the rival contentions and perused the material on

record. The learned CIT(A) had examined all the aspects of expenses

claimed by the assessee with evidence and books of account. The

appellant had not controverted the finding give by the Assessing Officer

before the learned CIT(A). Therefore, we also uphold the order of the 9 ITA 546/JP/2011 & C.O. 26/JP/2014_ DCIT Vs Bhawani Shankar Sharma

learned CIT(A). Accordingly, we dismiss the assessee's CO. on this

ground.

10. In the result, the revenue's appeal as well as the C.O. of the

assessee are dismissed.

Order pronounced in the open court on 16/01/2015.

Sd/- Sd/- ¼vkj-ih-rksykuh½ ¼Vh-vkj-ehuk½ (R.P.Tolani) (T.R. Meena) U;kf;d lnL;@Judicial Member ys[kk lnL;@Accountant Member

Tk;iqj@Jaipur fnukad@Dated 16th January, 2015.

*Ranjan.

vkns'k dh izfrfyfi vxzsf'kr@Copy of the Order forwarded to:

1. vihykFkhZ@The Appellant- The DCIT, Circle-6, Jaipur.

2. izR;FkhZ@ The Respondent- Shri Bhawani Shankar Sharma, Jaipur.

3. vk;dj vk;qDr¼vihy½@The CIT(A)-II, Jaipur

4. vk;dj vk;qDr@ CIT, Jaipur

5. foHkkxh; izfrfuf/k] vk;dj vihyh; vf/kdj.k] t;iqj@DR, ITAT, Jaipur

6. xkMZ QkbZy@ Guard File (ITA No. 546/JP/2011 & C.O. 26/JP/2014).

vkns'kkuqlkj@ By order,

lgk;d iathdkj@Asst. Registrar