9911796707
TMI Blog2014 (1) TMI 1638X X X X Extracts X X X X X X X X Extracts X X X X ..... gaged in business of supply of material and machinery used in civil construction work. The assessee filed return of income u/s. 44AD of the IT Act declaring income of Rs. 1,47,710/-. The AO observed that the business carried on by the assessee is not covered under the provisions of section 44AD. He has rejected the claim of the assessee and made addition of Rs. 16,94,500/- of entire deposits made in the bank account of assessee with Axis Bank. The addition was challenged before the ld. CIT(A) and it was submitted that the assessee is in busine ss of supply of material and machinery to the persons engaged in the business of civil construction. The assessee made total gross turnover of Rs. 25,56,850/- and deposited Rs. 16,94,500/- in his bank ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... We have considered the rival submissions. The ld. DR relied upon the order of the AO. On the other hand, the ld. Counsel for the assessee reiterated the submissions made before the authorities below and relied upon the order of the ITAT, Agra Bench in the case of Kamal Kumar vs. ITO in ITA No. 24/2012 dated 19.10.2012 in which in para 5 it was held as under : "5. We have considered the rival submissions and perused the orders of the authorities below. It is admitted fact that the assessee opened the bank account in question, in which several cash deposits were made on different dates totaling to Rs. 31,62,300/- Copy of the bank account is filed at page 1 to 11 of the paper book. The statement of assessee on oath was recorded at the assessm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... concerned parties, directed the assessee to produce 10 parties along with their books of account and confirmation. The statement of assessee on oath before the AO and the statement before the Addl. CIT find support from the details noted in the bank account of the assessee. On perusal of the details contained in the aforesaid bank account, we find that on credit side there are cash deposits on various dates in the financial year and on the debit side, the payments have been made to different parties through banking channel. Names of the parties and concerned bank through whom the payments have been cleared are mentioned. Thus, the parties are identifiable to whom the assessee made payments from same bank account. Further, the amounts have b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee against whom periodically and consistently payments have been made to the traders through bank ing channel. Therefore, the amounts deposited in the bank account should not have been treated as unexplained investment in the bank account of the assessee. Considering the totality of facts and circumstances noted above and the stand of assessee since initial stage of assessment clearly prove that the amount deposited in the bank account was in fact sale proceeds of the goods, which were sold by the assessee from time to time against whom the assessee issued cheques to various dealers and earned commission. Therefore, the addition u/s. 69 of the IT Act is wholly unwarranted and unjustified in the case of the assessee. Our findings ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 15/- may be made against the assessee instead of addition of Rs. 31,62,300/-. The orders of the authorities below are accordingly modified to the above extent and addition is restricted to Rs. 1,58,115/-." 4. On going through the finding of the ld. CIT(A) in the light of the above decision, it is clear that the assessee has declared total gross turnover of Rs. 25,56,850/- and in the absence of books of account, the AO estimated the total receipts at Rs. 30 lacs in the assessment order and did not accept the applicability of provisions of section 44AD of the IT Act being the nature of business of the assessee to be different. The AO directed to apply 10% profit rate and directed to make addition of Rs. 95,492/-. The AO similarly made additio ..... X X X X Extracts X X X X X X X X Extracts X X X X
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