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TMI Blog2024 (4) TMI 1188X X X X Extracts X X X X X X X X Extracts X X X X ..... .A. For the Respondent : Shri A.S. Nehra, Sr. DR. ORDER PER : DR. S. SEETHALAKSHMI, JM : This appeal filed by assessee is arising out of the order of the ld. CIT(A), National Faceless Appeal Centre, Delhi dated 27.12.2021[here in after CIT(A)/NFAC ] for assessment year 2017-18, which in turn arise from the order dated 24.11.2019 passed under section 143(3) of the Income Tax Act, by the AO. 2.1 At the outset of hearing, the Bench observed that there is delay of 37 days in filing of the appeal by the assessee for which the ld. AR of the assessee filed an application for condonation of delay in filling the present appeal and the, the application reads as ; On the subject referred above, I am enclosing herewith following documents:- (1) THAT Certified Copy of order of Commissioner of Income Tax (Appeal) order dated 27/12/2021 is enclosed herewith, plz accept the same. (2) THAT Electronically Appeal in this case was filed on 18/02/2022 and physical appeal in this case was due to filed on 20/03/2022. But physical documents was filed on 06/04/2022, it means late by 17 days, plz note. Delay is not intentionally. Delay is beyond the control of the assessee. Delay is due to following reasons ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g Authority not go to the books of accounts even not a single entry was pointed out by Assessing Authority wrong or questioned. Hence, without seen the books of accounts, book can not be rejected, which is bad in law. 3. That even at the time of finalization of appeal order by NFAC, Delhi, not a single entry was pointed out wrong or questioned. Hence Authority of NFAC, Delhi, also not go to the books of accounts, hence without seen the books of accounts, genuineness of case not arise, which is not based on accounting principles and natural justice. 4. That even NFAC Delhi not given opportunity to the assessee for faceless heaving, only documents required, which is also bad in law as well as facts of the case. 5. That tax charged by AO under section 115BBE and interest charged by AL is also not judicious. 4. Brief fact of the case is that the return of income for the assessment year 2017-18, in ITR-1 was e-filed on 27.03.2018 declaring total income of Rs. 4,10,500/- The case was selected for scrutiny under CASS. First notice u/s 143(2) of the Act was issued on 13.08.2018. There after the fresh notices u/s 142(1) of the Act were issued and the assessee was requested to furnish releva ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... claim that he had earn this amount from tailoring and stitching and accumulated he such amount every month for holding the same as Cash in Hand is illogical and not acceptable as he has not Provided any satisfactory explanation of the same. The assessing officer not satisfied from the explanation of the assessee and the records produced by the assessee. The ld. AO noted that explanation of the assessee were not satisfactory and contradictory therefore, the assessee was issued another notice invoking the provision of section 145(3) of the Act in response to that notice the assessee submitted justification of cash balance cashbook. The assessee submitted that she is filing return since 1998 wherein the nature of income is already shown as tailoring. This fact of filling the return and disclosing the nature of income is appearing from the ITR filed and same is already on record of the revenue. The assessee is having the source which the ld. AO is disputing merely on the reason that the assessee has deposited cash in the demonetisation period. The cash which the assessee is keeping on hand and because she is assessed to tax since 1998 and her ITR already filed by the assessee showing c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was having so much of cash as on 01.04.2016. 2. Even during the year, apart from mentioning that he named from stitching, cooking and tailoring, he hasn't brought any evidence which can be verified. For example, the name and addresses of the persons for whom he had worked, cash receipts, etc. The appellant has not been able to counter the facts mentioned in the Assessment Order. Instead it prefers to 1. That the assessee has not provided any supportive documents, evidence to prove correctness of this cash book especially of the cash in hand as on 01.04.2016. 2. The AO has brought a very Important and interesting fact on the record that the Appellant Family members who are residing at the same place had also made huge cash deposits during the demonization period the details of which are reproduced as below: S. No. Name and Address and PAN of the assessee Income (Rs.) as per ITR, and ITR form Cash deposit during demonetization 1. Sh. Rajesh B, Jajra, C-40, Rajeev Nagar, outside Mahamandir IIIRD pole, Jodhpur AAEHR 2635G Rs. 4,32,900/- Rs. 14,00,000/- 2. Bal Kishan R. Jajra, C-40, Rajeev Nagar, outside Rs. 6,21,790/- Rs. 13,50,000/- Mahamandir IIIRD Pole, Jodhpur AACHB8236K 3. Bha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... art from AY 1998-1999 to AY 2019-2020 showing complete details of business done and income earned from the beginning with details of income tax return s filed necessary details from proof of business income 26-27 7. ITR AY 1998-1999 to AY 2008-2009 and AY 2019-2020 Ay 1998-1999 28-29 AY 1999-2000 30-31 AY 2000-2001 32-33 AY 2001-2002 34-35 AY 2002-2003 36-37 AY 2003-2004 38-39 AY 2004-2005 40-41 AY 2005-2006 42-44 AY 2006-2007 45-47 AY 2007-2008 48-53 AY 2008-2009 54-61 AY 2019-2020 62-64 8. Proof for cash deposited previously in AY 2015-16 65-67 9. Bank pass book of Bhavna Ji Jajra for address proof 68 10. Dhakeshwari Cottaon Mills Ltd. Vs. Commissioner of Income Tax, West Bengal on 29 October, 1954: Supreme Court 74-81 11. Hon'ble Supreme Court in Sumati Dayal (1995) 214 ITR 801 (SC) 82-87 12. ITAT Allahabad Bench in Sudhir Kumar Tiwari vs. ITO 88-92 13. ITAT Delhi bench in sheo Chand Yadav vs. ITO 93-96 14. ITAT Pune Bench in Mrs. Usha Narayan Chaware vs. ITO 97-101 15. Order u/s 250 of income Tax Act 102-109 16. AO order u/s 143(3) of Income Tax Act 110-116 17. Power of Attorney in our favour 117 7. The ld. AR of the assessee in addition to the above paper book has filed th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s well as facts of the case. Hence facts mentioned by AO in his order page number 4 line number 15 (cash in hand as on 01/04/2016 is not provided) is not correct. Even the Assessing Authority has not seen computation of total income from Asst. Yr. 2008-2009 to 2012-2013 which is already on record that source of income is Rental Income also, which is verifiable from detailed chart (page no 26-27) but Assessing Authority has ignore this source of head, hence whole order passed by AD as well as CIT(A), NFAC is illegal, not as per facts of the case and bad in the eyes of law, hence whole addition is liable to be deleted. (5) However copy of cash book from 1.11.2016 to 30.11.2016 enclosed (page no 12) complete cash book, ledger, bank book from 01.4.2016 to 31.03.2017 is enclosed (page no 13-25) but Assessing Authority not gone through the Cash Book and books of accounts. Hence order passed by Learned Assessing Authority dated 24/11/2019 and appeal order dated 27.12.2021 passed by Commissioner of Income Tax (Appeals) National Faceless Appeal Centre is illegal, bad in law as well as facts of the case. (6) THAT the above named assessee is an existing assessee of income Tax from last more t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... done the above activities or not, but the assessing authority fails do so, meaning thereby Assessing Authority had not made any further factual enquiry before rejecting the books of accounts. So procedure adopted by AO as well as CIT (A) is not as per law and very these activities excessive. It is not the intention of the assessee to file the Income Tax Return in Form no. 1, because earlier years (page no 26-27), your honour would find that retail trade business income was shown and filed the Income Tax Returns with Trading account, Profit and Loss account, Capital a/c and Balance Sheet, which is tabulated in (page no 26-27). Assessing Authority not seen previous year income tax returns from Asst. Yr. 1998-1999 to 2008-2009 and AY 2019-2020 (12 years), previously assessee was filed ITR 4, ITR 2 and ITR 1 with Computation of total income, Trading account, Profit loss a/c, Capital a/c and Balance Sheet then Why the Assessing Authority was mentioned in page no 4 para 7 line no.6 only from ALY 2010-11 to 2018-2019, it means Assessing Authority manipulated the facts deliberately. (11) THAT I am Enclosing herewith detailed chart at (page no 26-27) showing the details of BUSINESS INCOME D ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 3 of Assessment Order is incorrect and bad in law means whole assessment order passed by learned Assessing Authority by malafide intention. AO also pointed out that the assessee cannot earn such amount from menial task like tailoring and stitching, your honour, it depends on case to case and there are many examples in India who does very well in such business and earn huge amount of income. That The Karnataka High Court in the case of Karnataka State Forest Industries Corporation Ltd., Vs. CIT (1993) 201 ITR 674 (page no 69-73) has held that the Assessing Officer's powers under the Section are not arbitrary and he must exercise his discretion and judgment judicially. There must be something more than mere suspicion to support an assessment under Section 145(3). The rule of law on this subject has been fairly and rightly stated by the Supreme Court in the case of Dhakeswari Cotton Mills Ltd., v/s. CIT (1954) 26 ITR 775. (page no 74-81) (15) THAT I am again enclosing herewith Cash Book, Ledger, Bank Book for Asst. Yr 2017-2018 (page no 13-25).On going through the cash book your honour would find that Complete Narration of each and every entry in Cash Book is available in Cash Bo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oks an account regular maintained by the assessee, bank pass book and income tax record also, which means no ABNORMAL cash was deposited in demonitisation period and cash deposited in demonitisation period was out of past savings Cash balance as on 01.04.2016 and income related to current year only. In AY 2015-2016 a sum of RS 6,50,000 in three itervals was deposited in saving bank account also. Copy of bank a/c is enclosed. (Page no 65-67) Explanation as Past Savings of HUF and Members, No other Deposits during Demonetization: ITAT deletes Income Tax Addition Sudhir Kumar Tiwari vs Income Tax Officer 2022 TAXSCAN (ITAT) 1464 (Page no 88-92) The Income Tax Appellate Tribunal (ITAT), Allahabad Bench deleted income Tax Addition on the ground that the explanation was past savings of HUF and its members and no other deposits were made during demonetization. A Single Bench of the Tribunal consisting of Vijay Pal Rao, Judicial Member observed that Accordingly, in the facts and circumstances of the case when the assessee has explained the source of Rs. 1,00,000/- as past savings of the assessee HUF and its members and there are no other deposits during the demonetization the addition made ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the cash deposit. The Tribunal of RS Syal, Vice President noted that Once the availability of cash in hands was established and it was not shown by the AO that such cash was spent elsewhere, I am of the considered opinion that the explanation of the assessee as to its utilization has to be accepted. Hence facts of our case is similar to above as source of cash deposited was declared out of past savings Cash balance as on 01.04.2016 and income related to current year only. (23) THAT whole story was made by the assessing authority in page no 5 para no 9 of Assessment Order here to mention that other member of the assessee's family has done the same thing and had tried to evade taxes In this respect I am to state that AO list as per order two assessee's are HUF entity and other BHAVNA DEVI JAJRA has no direct connection with above named assessee. Bhavana jajra is not residing with the above assessee on same place actually address of Bhavna Jajra is B 3 Shakti Nagar Gali no 1 paota c road jodhpur which is verifiable from bank passbook enclosed at (page no 68). Hence CIT (Appeals) NFAC mentioned wrongly facts in his order page no 6 last para, (24) THAT issue for penalty proc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tailoring work is not placed / discussed with the ld. AO. The ld. DR referring to the chart of cash balance made available is of year 2015-2016, 2016-17 2017-18 no proof of the figure mentioned is submitted. The cash book furnished by the assessee is also not maintained day to day it is merely summary. The ld. DR referring to page 44 submitted that there is no calculation to show how he can be relied from business income as there is no source from the business income or there is no business stock available. Even though there is demonisation the assessee seamlessly even after demonetisation having the cash income it self suggest that the accounts are fabricated. 10. We have heard both the parties and perused the materials available on record. For the year under consideration the assessee filed her return of income for the assessment year 2017-18, in ITR-1 and was e-filed on 27.03.2018 declaring total income of Rs. 4,10,500/- The case was selected for scrutiny under CASS. The case was selected for scrutiny u/s 143(3) of the Act by CASS and type of scrutiny was limited and the issues identified for examination was per notice u/s 143(2) were cash deposit during demonetisation period . ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e-tax v. Parmeshwar Bohra, 131 Taxman 145 (Rajasthan) wherein the jurisdictional high court held that; 7. It appears that the Tribunal has considered the issue regarding assess ability of the capital while considering the assessee s appeal ITA 71(JDP)/99 for the assessment year 1993-94 by order dated 6-12-2001 whereby the Tribunal held that it is not a case of introduction of cash credit but it is a case of unexplained investment under section 69 of the Act of 1961 and the appropriate previous year for inclusion is the relevant financial year and, therefore, the opening capital account cannot be added as an unexplained investment under section 69 of the Act of 1961 for the assessment year 1993-94. The Tribunal also held that the genuineness of the capital introduction has already been adjudicated upon by the assessing authority for the appropriate financial year relevant to assessment year 1992-93. The Tribunal also took note of the fact that the order passed by the assessing authority for the assessment year 1993-94 on the basis of notice under section 148 dated 17-6-1997 has already been quashed by the order dated 6-12-2001 in the same ITA No. 71 (JDP)/99. Therefore, on the basis ..... X X X X Extracts X X X X X X X X Extracts X X X X
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