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2016 (3) TMI 1072 - ITAT COCHIN

2016 (3) TMI 1072 - ITAT COCHIN - TMI - Unaccounted deposits in the three accounts of the assessee company in Federal Bank - Held that:- In view of the admission by the Id. AR as well as the fact the four hajj firms floated by the assessee company had no infrastructure of their own and they did not even had their own bank accounts, the income of the Hajj firms is to be assessed in the hands of the assessee company only.

As regards the merits of the addition is concerned, the assessee .....

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ssment year along with the statement of cash flow. The ld.CIT(A) has verified the details of the bank accounts and found no infirmity in the details given by the assessee company. The objection of the revenue that the reliance should solely be placed on the statement of Sh. M. Narayana Kumar is misplaced. The assessing officer went on a wrong premise and added the entire deposits appearing in the bank accounts without deducting the withdrawals made. It is a settled principle of law that only the .....

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of the Revenue arise from the different orders the ld.CIT(A)-I, Kochi for the Asstt.Years 2008-09 to 2011-12. The assessee has also filed appeal for the Asstt.Years 2009-10 to 2011-12. Since issues in all the appeals are identical, therefore, all the appeals are being decided by this consolidated order. 2. First of all, we take up the Revenue s appeal in ITA No.449/C/2014 for the Asstt.Year 2009-10 and our order hereinbelow shall be identically applicable in all other Revenue s appeal, since the .....

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as conducted at the business premises of the assessee company on 10.11.2010. Subsequently notices under section 153A were issued to the assessee for six years i.e. A.Y. 2005-06 to 2010-11. During the course of search at the premises of the assessee company, a computer belonging to the assessee was seized in which collections from Hajj and Umrah services was recorded as ₹ 118,27,12,252/-. The assessing officer observed that the assessee had not accounted for a total amount of ₹ 94,96, .....

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0 9,56,58,499 3,90,09,387 18,07,67,898 31,54,35,784 4. 2010-11 30,24,972 4,09,81,406 18,92,50,158 23,32,56,536 Total 9,86,83,471 9,92,16,310 75,17,38,209 94,96,37,990 4. The assessing officer held that these three accounts did not appear in the final accounts of the assessee as per the returns of income filed. Accordingly, the assessing officer treated the entire bank deposits amounting to ₹ 94,96,37,990/- as undisclosed income of the assessee. For the relevant A.Y. 2009-10 a sum of ₹ .....

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by the Government of Saudi Arabia on the number of pilgrims each agency could send from India. The said firms had no bank accounts of their own and though the receipts of these firms ran into several crores. Considering the aforesaid facts and also the fact that these concerns did not have separate infrastructure of their own, the income of these four firms were substantively assessed in the hands of the assessee company and protective assessment were made in the hands of the four firms. In the .....

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ccount and relying upon the orders passed in the case of aforesaid four firms floated by the assessee company, the average profit per person earned by the assessee company was estimated at ₹ 32,000/-. Accordingly, addition of ₹ 1,92,00,000/-was made with respect to 600 pilgrims. 7. Aggrieved by the assessment order dated 30.03.2013, the assessee company preferred appeal before the Ld.CIT(A). The Ld.CIT(A) in its order dated 30.06.2014 observed that the income of the four Hajj Group f .....

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licut. Accordingly, the Ld.CIT(A) referred the same to the assessing officer for a remand report. The assessing officer reiterated his observations given in the assessment order. After considering the details submitted by the assessee, the Ld.CIT(A) held that the bank accounts in the name of the assessee in Federal bank cannot be treated as undisclosed bank accounts as the receipts and payments were verifiable. He further observed that the assessee had established a link of inter related transac .....

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ue is in appeal before us and has raised the following grounds of appeal: 1. The order of the learned Commissioner of Income Tax (Appeals) - 1, Kochi is opposed to law, weight of evidence and facts of the case. 2. The CIT (A) has not taken in to consideration the fact that the assessee has not disclosed the deposit in 3 bank accounts with Federal Bank which are the unaccounted deposits in the balance sheet for the relevant financial year. Hence the CIT (A) has erred in disallowing the addition m .....

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ide and that of the assessing officer may be restored. 11. The revenue has challenged the deletion of addition of ₹ 20,86,17,005/- with respect to unaccounted deposits in the three accounts of the assessee company in Federal Bank. It is the case of the revenue that in the absence of any concrete evidence supporting the deposits and withdrawals which have happened in the aforesaid bank accounts, the entire deposits have to be treated as unaccounted income of the assessee company. The Ld. DR .....

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eipts as well as the withdrawals appearing in the aforesaid bank accounts have been entered and accounted for in the books of account of the assessee company and all the transactions carried out have been recorded in the books. He submits that the receipts collected by the four firms were deposited in the three accounts mentioned as the firms did not have bank accounts in their own name. The Ld. AR has referred to the letter dated 14.03.2013 by the Managing Director of the asseessee company wher .....

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s. He therefore, supports the reasoning given by ld. CIT(A) with respect to the aforesaid ground. 13. We have heard the rival submissions and perused the record of the case. In view of the admission by the Id. AR as well as the fact the four hajj firms floated by the assessee company had no infrastructure of their own and they did not even had their own bank accounts, the income of the Hajj firms is to be assessed in the hands of the assessee company only. 14. As regards the merits of the additi .....

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ok maintained by the assessee. As regards the other deposits of ₹ 19,77,91,201/- and ₹ 1,84,05,701/- in account nos. 4454 and 4967 respectively, the assessee submits that they relate to the receipts from Hajj and Umrah pilgrimage. The assessee has established the link between the deposits pertaining to the four Hajj groups. The credits in the three bank accounts which is sought to be treated as undisclosed income by the revenue are reflected in the books of four Hajj group firms. 16. .....

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time of remand by the ld.CIT(A), the assessing officer did not consider the same and merely reiterated the assessment order. The assessee had filed the copies of details of all the bank transactions, details of sales of Air ticket and expenses pertaining to Hajj and Umrah Services for relevant assessment year along with the statement of cash flow. The ld.CIT(A) has verified the details of the bank accounts and found no infirmity in the details given by the assessee company. The objection of the .....

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s furnished by the assessee company before the ld.CIT(A) is concerned for which remand report was requested from the assessing officer, no adverse objections had been raised by the assessing officer. The ld.CIT(A) has observed that the source of the receipts in the bank accounts are verifiable. We, therefore, find no infirmity in the order passed by the CIT(A) with respect to the aforesaid addition. The addition pertaining to the deposits made in Federal Bank was rightly deleted by the ld.CIT(A) .....

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peals, and therefore, the appeal of the Revenue being ITA No.448, 450 and 451/C/2014 are dismissed. 21. Now we take up the appeals of the Assessee in ITA Nos.427, 428 and 429/C/2014. 22. First we take up the appeal of the assessee in ITA No.427/C/2014 for the Asstt.Year 2009-10. 23. Brief facts of the case are that the assessee is engaged in the business of tours and travels and is conducting Hajj and Umrah Services. The relevant assessment year is A.Y.2009-10. The facts of the present case are .....

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-and made an addition of Hajj income in respect of Kerala Islam Hajj and Umrah Services ₹ 35,46,000/- and the Commissioner of Income Tax (Appeals) has gone wrong in confirming the profit @ ₹ 1,35,39,595/- in respect of Hajj pilgrimage conducted by the appellant Company. 2. The income estimated by the Commissioner of Income Tax(Appeals), Calicut in respect of Kerala Islam Hajj and Umrah Services for the A.Y. 2009-10 is highly excessive and the appeal filed in respect of Kerala Islam H .....

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it estimated from one person @ ₹ 22,565/- for 600 pilgrims. The amount of income estimated @ ₹ 1,35,39,595/- is highly excessive considering the income earned by the other hajj groups. For the above reasons and other arguments those may be put forward at the time of hearing the appellant may submit that the assessment of ₹ 35,46,000/- in respect of income from Kerala Islam Hajj and Umraj Services, Calicut and the income estimate @ ₹ 1,35,39,595/- may be. 25. The ground no .....

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see afresh in accordance with the assessment of four firms stated hereinabove, at the rates determined therein. Thus, grounds to that extent are allowed for statistical purpose. 26. Grounds No. 3 pertain to the estimation of income at ₹ 32,000/-per person by the assessing officer. The ld.CIT(A) estimated the income per person at ₹ 22,565/- and sustained the addition of Rs.. 1,35,39,595/-. 27. In ITA No. 421/C/14, M/s Kerala Islam Hajj & Umrah Services Vs. DCIT, we have estimated .....

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of the present case are already stated in the case of the assessee in ITA No. 449/C/14 wherein the revenue had filed the appeal against the order of CIT(A). 31. The ground no.1 & 2 raised by the assessee area already adjudicated by us in the appeal filed by Revenue in ITA No.449/C/2014 wherein, we have held that substantive assessment in respect of four firms floated by the assessee, viz. Kerala Islam Hajj and Umrah Service, Ahlan Hajj and Umrah Services, Salamat Hajj Group and Vazco Hajj G .....

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