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2015 (7) TMI 771 - ITAT LUCKNOW

2015 (7) TMI 771 - ITAT LUCKNOW - TMI - Addition on account of alleged payment of insurance premium - Held that:- It is the assertion of the assessee that the concerned truck No. UP 78 B 1033 belonged to Shri Rakesh Kumar Chopra, nephew of the assessee and it is also asserted by the assessee before learned CIT(A) that such a fact had been got clarified by the A.O. through enquiries made from the office of R.T.O. This assertion of the assessee could not be controverted by any of the authorities b .....

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ion made on account of interest on deposit with M/s Sanjay Textiles, Kanpur - Held that:- It is undisputed fact that the amount is standing in the name of Suman Bala Chopra, wife of the assessee, in the books of M/s Sanjay Textiles, Kanpur. The basis of making addition by the Assessing Officer is that Suman Bala Chopra, wife of the assessee, is not assessed to tax and the Assessing Officer has straight away invoked the provisions of section 64 of the Act for making this addition without pin poin .....

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Officer that the investment with M/s Sanjay Textiles, Kanpur was made by the assessee’s wife in the pre block period then income accruing out of such investment cannot be added in the hands of the present assessee. This is also noted by the Assessing Officer in the same Para of the assessment order that no fresh deposit was made by Suman Bala Chopra during block period. As per the ledger account copy available on pages 21 to 27 also, during this period, the addition is only on account of interes .....

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overed u/s 44AE of the Act then some evidence should have been brought on record by the Assessing Officer to show that the assessee was having more trucks and therefore, the assessee cannot get the benefit of section 44AE. Even if that is fact that the assessee is not covered u/s 44AE then also it is admitted position that the deposit in the bank accounts is relatable to freight charges and therefore, the total amount cannot be added as income of the assessee because for earning freight charges, .....

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- in assessment year 1999-2000, ₹ 48,000/- in assessment year 2000-2001 and ₹ 90,000/- in assessment year 2001-02 totaling to ₹ 2.46 lac in assessment year 1997-98 to assessment year 2001-02. It is also seen that as per the details of deposit in bank account also, as appearing in Para 26 of the assessment order, there was no deposit in bank account after financial year 2000-2001. Hence, in the facts of the present case, the addition is not justified. - Decided in favour of asse .....

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sustaining the following additions:- (a) payment of insurance premium 3,107 (b) interest on deposit with M/s. Sanjay textiles, Kanpur as made by Smt. Suman Bala Chopra (wife of the appellant) 74,093 (c) dposit in SB A/c. No. 1863 with Allahabad Bank, Sakkarpati Branch, Kanpur, in the name of the appellant 1,58,810 (d) Deposit in SB A/c. No. 709 with United Mercantile Cooperative Bank Ltd, Godarinpurwa Branch, Fazalganj, Kanpur, standing in the names of "Rajendra Kumar Chopra Harish Kumar Ch .....

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ghts and in the absence of any material to the contrary found during the course of search under section 132(1), no such addition could have been made / sustained in the block period assessment. 4. BECAUSE source of deposits in the two bank accounts aggregating ₹ 3,75,653/- (Rs.1,58,810 + 2,16,843) stood fully explained and covered from the incomes disclosed by the "appellant" in the 'returns' filed in regular course and the 'Authorities' below have grievously erre .....

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ded to the income of the "appellant", as "undisclosed income". 6. BECAUSE in any case addition of ₹ 3,75,653/- as sustained by the "CIT(A)" is" to much high and excessive. 7. BECAUSE the order appealed against is contrary to the facts, law and principles of natural justice. 3. Regarding ground No. 1(a) in respect of addition of ₹ 3,107/- on account of alleged payment of insurance premium, it was submitted by Learned A.R. of the assessee that on page .....

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icer is not justified. He reiterated the same contentions, which were raised before learned CIT(A) and were reproduced by him in Para 4.1 of his order. 4. Learned D. R. of the Revenue supported the orders of the authorities below. 5. We have considered the rival submissions. First of all we reproduce Para 4.1 from the order of learned CIT(A) in which he has reproduced the written submissions submitted by the assessee before him, which is as under: 4.1 In this regard, the Ld. A.R. of the appellan .....

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During the course of the assessment proceeding it had been explained that insurance co. had wrongly mentioned the name of the appellant in the cover note and in support of this contention, a corrected cover note was a/so placed on record. Thus, this addition of ₹ 3,107/- was not justified." 5.1 From the above Para from the order of learned CIT(A), it is seen that it is the assertion of the assessee that the concerned truck No. UP 78 B 1033 belonged to Shri Rakesh Kumar Chopra, nephew .....

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nephew of the assessee, it is not very unusual to find a receipt of the nephew of the assessee at the place of the assessee and under these facts, we feel that the addition is not justified and the same is deleted. 6. Regarding ground No. 1(b) in respect of addition made by the Assessing Officer of ₹ 74,093/- on account of interest on deposit with M/s Sanjay Textiles, Kanpur, it was submitted by Learned A.R. of the assessee that the copy of ledger account of Suman Bala Chopra, wife of the .....

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justified. 7. Learned D. R. of the Revenue supported the orders of the authorities below. 8. We have considered the rival submissions. We find that it is undisputed fact that the amount is standing in the name of Suman Bala Chopra, wife of the assessee, in the books of M/s Sanjay Textiles, Kanpur. The basis of making addition by the Assessing Officer is that Suman Bala Chopra, wife of the assessee, is not assessed to tax and the Assessing Officer has straight away invoked the provisions of secti .....

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income and not salary, commission, fees etc. As per clause (iv) of sub section (1) of section 64, if any income is accruing to the spouse of the assessee from some assets transferred by the assessee otherwise than for adequate consideration in that case, such income accruing to the spouse will be added in the hands of the assessee who has transferred such assets to the spouse. Hence, before proceeding to invoke the provisions of section 64(1)(iv), this is pre-requirement that this fact is estab .....

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transferred by the assessee to his spouse without adequate consideration. It was also submitted by the assessee before the CIT(A) as per his submission reproduced by CIT(A) in Para 5.1 of his order that the Assessing Officer has proceeded on this basis that the wife of the assessee was not assessed to tax but this is ignored that necessary details of assessment of Suman Bala Chopra was produced in respect of post search years and for earlier period, she was not enjoying taxable income and there .....

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f the assessment order, it is noted by the Assessing Officer that the deposit of ₹ 58,764/- was made by the assessee s wife with M/s Sanjay Textiles, Kanpur prior to block period and therefore, it does not require any further verification. As per the copy of ledger account of Suman Bala Chopra with M/s Sanjay Textiles, Kanpur, appearing on page No. 21 of the paper book for the financial year 1996-97, it is seen that the opening balance shown is ₹ 58,764/- and this is admitted by the .....

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hopra during block period. As per the ledger account copy available on pages 21 to 27 also, during this period, the addition is only on account of interest for each year and there is no fresh investment by the wife of the assessee. Considering all these facts, in our considered opinion, the addition is not justified and section 64 is not applicable. Hence, this addition is deleted. 9. Ground No. 1(c) and 1(d) are regarding deposit in SB account No. 1863 with Allahabad Bank ₹ 1,58,810/- and .....

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11] 338 ITR 226 (Ker) (iv) CIT vs. R.M.L. Mehrotra [2010] 320 ITR 403 (All) 10. He also reiterated the same contentions which were made before learned CIT(A) and which have been reproduced by him in Para 6.1.2 of his order. 11. Learned D. R. of the Revenue supported the orders of the authorities below. 12. We have considered the rival submissions. First of all we reproduce the relevant Para from the order of learned CIT(A) i.e. Para 6.1.2 where learned CIT(A) has reproduced the written submissio .....

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nd other misc. road expenses incurred by the drivers. The appellant has shown the income from truck plying business as per provisions of section 44 AE of the I.T. Act, 1961 and the net income including the income on the deposits in these account was already shown u/s 44 AE of the I. T. Act, 1961. 2. That while completing the assessment the Ld. A.O. has dis-believed the appellant's submission and out rightly made an addition of ₹ 3,75,653/- after considering the receipts of Dinesh Oil L .....

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and has ignored the debit side of the bank account. The appellant has already shown the 'income earned on account of the truck plying business u/s 44 AE of the I, T. Act, 1961 only these accounts were left to be mentioned. 12.1 From the above Para of the written submissions of the assessee reproduced by learned CIT(A), we find that it is the claim of the assessee that the entire deposit in these accounts represents the receipts on account of truck plying business in shape of freight from var .....

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6 to 18 of the paper book. As per the same, in assessment year 1997-98, the assessee has disclosed net income from truck plying being truck No. UAN 9214 at ₹ 24,000/-. Similarly in assessment year 1998-99 ₹ 24,000/- was disclosed as income in respect of the same truck and ₹ 2,000/- was disclosed for another truck No. UP 78B 3175 purchased on 25/03/98 and in this manner, total income as per section 44AE was worked out at ₹ 26,000/- but the assessee disclosed the income of .....

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ng Officer in the assessment order on pages 5 to 7 of the assessment order and there, it is noted that in course of block assessment proceedings, information u/s 133(6) was called for from M/s Dinesh Oils Ltd., Kanpur regarding the business transaction with the assessee during the block period and it was indicated by that company that they have paid certain freight charges to the assessee on different dates i.e. financial year 1998-99 and 1999-2000. Thereafter, the Assessing Officer examined the .....

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ive Bank Ltd. Thereafter the Assessing Officer has worked out year-wise position of deposit in these accounts and the same is tabulated on page No. 8 of the assessment order and the total deposit in these accounts during financial year 1996-97 to 2002-03 was noted at ₹ 3,75,653/- and the Assessing Officer made the addition of entire such deposit. When these two facts are examined together, it comes out that the deposit in bank accounts were in respect of receipt of freight charges from var .....

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not justified. If the assessee was having more trucks and for that reason, the assessee is not covered u/s 44AE of the Act then some evidence should have been brought on record by the Assessing Officer to show that the assessee was having more trucks and therefore, the assessee cannot get the benefit of section 44AE. Even if that is fact that the assessee is not covered u/s 44AE then also it is admitted position that the deposit in the bank accounts is relatable to freight charges and therefore, .....

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