2016 (12) TMI 1751 - AT - Income Tax

Addition u/s 69A - cash deposits in the bank account - Held that - The assessee failed to submit any document in support and did not file copy of the VAT return before the Assessing Officer. No evidence was submitted with regard to sales or purchases made. The assessee made cash deposit of ₹ 37,73,695/- in his SB account, however, assessee failed to explain any source of such deposit in the bank account. Whatever contention was raised by assessee, were found to be false and fabricated. The claim of the assessee of estimated sales of ₹ 29 lacs was not supported by any evidence or material on record. The assessee in the IT Return and in the VAT returns, have not disclosed gross sales of ₹ 29 lacs. No evidence was filed before the authorities below in support of any of the explanation, therefore, source of the cash deposited in the bank account remained unexplained. Even before me, no evidence of any source of bank deposit has been furnished. In the absence of any evidence or material on record to explain the cash deposits in the bank account of the assessee - Decided against assessee. Addition on account of lesser closing stock declared in income tax return as against declared in VAT return which is arbitrary & unjustified - Held that - The assessee did not submit any evidence before authorities below therefore, addition of ₹ 4,30,000/- was made. The assessee did not explain the discrepancy found vis -vis VAT return therefore, CIT(Appeals) dismissed this ground of appeal of the assessee. The assessee did not point out any infirmity in the order of the authorities below in making this addition. In the absence of any specific argument or material to point out any error in the orders of authorities below, not inclined to interfere with the orders of authorities below. This ground of appeal of the assessee is dismissed. Addition on account of alleged lesser labour job declared - Held that - Assessee did not point out any error in the orders of authorities below therefore, in the absence of any argument or material on record, we are not inclined to interfere with the orders of authorities below - Decided against assessee.

Summary

Issues:
1. Addition under section 69A of the IT Act on account of cash deposits
2. Addition on account of alleged lesser closing stock
3. Addition on account of alleged lesser income from labor job
4. Charging of interest under section 234B of the Income Tax Act

Analysis:
1. The first issue pertains to the addition under section 69A of the IT Act on account of cash deposits. The assessee declared income on an estimate basis, including income from auto parts business and labor job. The Assessing Officer found inconsistencies in the declared sales figures and cash deposits made by the assessee. Despite the assessee's explanations, no supporting documents were provided. The authorities below noted discrepancies between the declared sales and actual figures, leading to the addition under section 69A. The appellate tribunal upheld the decision, emphasizing the lack of evidence to explain the cash deposits.

2. The second issue concerns the addition due to alleged lesser closing stock. Discrepancies were found between the closing stock figures declared in the income tax return and the VAT return. The Assessing Officer added the difference to the income, as the assessee failed to provide any evidence to justify the lower closing stock figure. The appellate authority dismissed the appeal, as no infirmity was pointed out in the decision. The tribunal concurred with the lower authorities, dismissing the appeal due to the lack of specific arguments or evidence.

3. The third issue involves the addition on account of alleged lesser income from a labor job. The assessee declared different income amounts from labor jobs in the income tax return and the VAT return. The Assessing Officer added the variance to the returned income, attributing it to undisclosed income. The assessee failed to substantiate their position before the appellate authority, leading to the dismissal of the appeal. The tribunal, finding no errors in the lower authorities' decisions, upheld the dismissal based on the absence of arguments or supporting material.

4. The final issue relates to the challenge against the charging of interest under section 234B of the Income Tax Act. The assessee contested the interest charge but did not provide arguments to support their challenge. Consequently, the tribunal dismissed the appeal concerning the interest charge, considering it mandatory and consequential under the law.

In conclusion, the appellate tribunal upheld the decisions of the lower authorities regarding the additions made under various sections of the IT Act due to discrepancies in income declarations and lack of supporting evidence. The appeal was dismissed on all grounds, including the challenge against the interest charge, due to the absence of substantive arguments or materials to refute the decisions of the authorities below.