9911796707
TMI Blog2023 (12) TMI 1325X X X X Extracts X X X X X X X X Extracts X X X X ..... is bad in law. Hence, the assessee will be assessed related to excess cash under normal rate of tax not U/s 115BBE of the Act. Appeal of assessee allowed. - DR. M.L. MEENA, ACCOUNTANT MEMBER AND SH. ANIKESH BANERJEE, JUDICIAL MEMBER For the Appellant : Sh. Gaurav Aggarwal, CA. For the Respondent : Sh. Sandeep Dahia, CIT DR. ORDER PER: ANIKESH BANERJEE, JM: The instant appeal of the assessee was filed against the order of the ld. Commissioner of Income-tax (Appeals)-5, Ludhiana, [(in brevity the CIT(A) ] order passed u/s 250(6) of the Income-tax Act, 1961 (in brevity the Act) for assessment year 2018-19. The impugned order was emanated from the order of the ld. Asstt. Commissioner of Income Tax, Central Circle, Amritsar (in brevity the AO ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mran Medicos. During survey proceeding the statement of the assessee was recorded. The assessee surrendered amount of Rs. 50,38100/- out of which Rs. 43,25,285/- was recorded to excess stock found during the survey and Rs. 7,12,805/- related to excess cash found from the business premises of the assessee during the survey. In the books assessee declared cash Rs. 40,550/- on the date of survey. During survey the cash of amount to Rs. 7,53,355/- was found by the survey team. Therefore, the balance amount which works out to Rs. 7,12,805/- was added with the total income u/s 69A of the Act. Accordingly, the tax was levied on this amount u/s 115BBE(2) of the Act. Aggrieved assessee filed an appeal before the ld. CIT(A). But the ld. CIT(A) upheld ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... : - 6. We heard the rival submission and considered the documents available in the record. During survey proceeding the assessee surrendered total income of Rs. 29 lacs out of which amount to Rs. 14,23,000/- was related to other discrepancies/miscellaneous business income which was treated as income u/s 69A and calculated tax under special rate during assessment. There entire addition is certainly without forming proper basis for conversion into business income to non-business income. The revenue was not able to submit any evidence during assessment and appeal proceeding that the said income is not connected with the business income of the assessee or accumulated from non-recognising source. Hence, when all the incomes earned by the assesse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t by the assessee and that expenditure laid out for the purpose of business is to be allowed deduction either as expenditure or to be capitalized on which depreciation will be allowed. In the present case, to the extent of the expenditure incurred for construction of the building, out of unexplained source is concerned, it is to be construed as income earned from the business and it will take character of the business income. The case law relied upon by the Ld. CIT(A) is distinguishable on the facts as in that case the amount surrendered during survey was not reflected in the books of account and the source from where it was derived was not declared/explained whereas in the present case the amount surrendered during survey was duly reflecte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... between the surrendered income and business and no source for the surrendered income could not relate to. The judgments cited supra i.e.: (1). Fakir Mohammed Haji Hasan Vs. CIT ([2001] 247 ITR 290 (Guj.) (2) PCIT vs. M/s. Khushi Ram Sons Pvt. Ltd., the Hon'bie High Court of Punjab Haryana in ITA No. 126 of 2015 dated 21.07.2016 (3) SVS Oil Mills vs. ACIT, Chennai, the Hon ble High Court of Madras in ITA No. 765 of 2018 dated 26.03.2019 (4) Kim Pharma Pvt. Ltd. vs. CIT in ITA No. 106 of 2011 dated 27.04.2011, (5) The Hon ble Supreme Court in the cases of Roshan Di Hatti vs. CIT [1977] 107 ITR 938 (SC) (6) Hon bie ITAT Cochin Bench, Cochin in the case of M/s. Bhima Jewellers vs. PCIT Kozhikode in ITA No. 208/Coch/2018, Assessment Year 201 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was delivered by the same combination of the ITAT Amritsar Bench. The revenue was unable to show any other sources related to excess cash found in the survey. During statement recorded in survey the assessee clearly declared that the assessee had not made any investment in immovable property within 6 years and the entire amount of the excess cash was generated from undeclared sale of medicine. So, the source of excess cash is from business. Therefore, we are setting aside the impugned appeal order. Accordingly, the application of section 115BBE an amount of Rs. 7,12,805/- is bad in law. Hence, the assessee will be assessed related to excess cash under normal rate of tax not U/s 115BBE of the Act. 7. In the result, appeal of the assesseeITA ..... X X X X Extracts X X X X X X X X Extracts X X X X
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