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Sri Biswajit Saha Versus ITO Ward-49 (4) , Kolkata

2016 (10) TMI 487 - ITAT KOLKATA

Undisclosed credit entries reflecting in the bank statements - Held that:- We disagree with the view taken by the lower authorities that the credit entries reflecting in the undisclosed bank statement are representing the income from undisclosed sources. It is because that it is the duty of the lower authorities to establish the exact nature and character of such receipts. The argument placed by Ld AR that these credit entries are reflecting from the disclosed bank account has not been considere .....

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ndisclosed income / investment has escaped assessment. Therefore, we reverse the order of Authorities Below. AO is directed accordingly. Hence, inter-connected ground of assessee is allowed. - Addition u/s 40A - Held that:- As decided in CIT vs. Crescent Export Syndicate [2008 (7) TMI 977 - CALCUTTA HIGH COURT ] the genuineness of the purchase has been accepted by the ld. CIT (Appeal) which has also not been disputed by the department as it appears form the order so passed by the learned Tri .....

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t : Shri Soumitra Choudhury, Advocate For The Respondent : Shri Rajat Kr. Kureel, JCIT-SR-DR ORDER PER Waseem Ahmed, Accountant Member:- This appeal by the assessee is against the order of Commissioner of Income Tax (Appeals)-XXXII, Kolkata dated 03.12.2012. Assessment was framed by ITO Ward-49(4), Kolkata u/s 143(3) of the Income Tax Act, 1961 (hereinafter referred to as the Act ) vide his order dated 30.12.2010 for assessment year 2008-09. In this appeal various grounds have been raised out of .....

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CIT(A) has failed to consider the Written Submission explaining deposits with AXIS Bank tallied with UBI account and opening balance required consideration ₹ 253,287/- as such the finding in appellate order confirming the addition of ₹ 2,76,150/- is wrong, arbitrary, and illegal. 4. For that on the facts of the 275000/-case, the source of investment in F.D s with AXIS Bank ₹ 27,500/- were deposits out of withdrawal from same bank, as such the Ld. CIT(A) s action in confirming .....

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the I.T Rule, 1962 and all the relevant evidences were produced to justify the claim. 7. For that on the facts of the case, payee is raising Service Tax on bills, therefore, services were rendered services agent M/s Active Advertising & Marketing who in turn, making cash payment exceeding ₹ 20,000/- to Newspapers and supporting evidences were submitted in appeal. 8. For that proviso to sec. 40A(3) although find place in Written Submission but ignored in appellate order, so the Ld. CIT .....

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siness of advertising agency. The return of income was filed declaring income from business and interest for ₹ 1,35,762/-. Thereafter the case was selected for scrutiny assessment through CASS module and assessment was framed u/s 143(1) of the Act at ₹ 27,81,470/-. 3. The issues raised in ground no. 2 to 5 are interconnected so they are being clubbed together and disposed by passing consolidate order. The issues relate to the money deposited in the bank accounts which were not disclo .....

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cordingly, the Assessing Officer proposed to add the same to the total income as from the undisclosed source. In rebuttal, the assessee submitted that all the transactions of this bank account are of personal nature and therefore it was not disclosed. However, the AO disregarded the plea of the assessee by treating the same as undisclosed income for ₹ 1,02,699/- and accordingly added to the total income of the assessee. Similarly, the assessee made investment of ₹ 2.75 lakhs during t .....

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s from the undisclosed source. In rebuttal, assessee submitted that all the transactions of this bank account are of personal nature and therefore it was not disclosed. However the AO disregarded the plea of the assessee by treating the same as undisclosed income for ₹ 2,76,150/- and accordingly added to the total income of the assessee. 4. Aggrieved, assessee preferred an appeal to ld. CIT(A) who has upheld the order of the AO. Being aggrieved by the order of the ld. CIT(A), the assessee .....

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he other hand, Ld. DR submitted that it is difficult to ascertain whether the credit entries reflecting in the undisclosed bank account are income from undisclosed sources. These undisclosed bank accounts were found by the AO on the basis of Annual Information Report. The assessee has not disclosed the same to escape from the tax liability from the undisclosed sources. Ld. DR vehemently relied on the order of authorities below. 6. We have heard rival contentions and perused the materials availab .....

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t the undisclosed income / investment. At the outset, we disagree with the view taken by the lower authorities that the credit entries reflecting in the undisclosed bank statement are representing the income from undisclosed sources. It is because that it is the duty of the lower authorities to establish the exact nature and character of such receipts. The argument placed by Ld AR that these credit entries are reflecting from the disclosed bank account has not been considered by the lower author .....

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nvestment has escaped assessment. Therefore, we reverse the order of Authorities Below. AO is directed accordingly. Hence, inter-connected ground of assessee is allowed. 7. Next inter-connected issue raised by the assessee in ground no. 6 to 8 in this appeal is that ld. CIT(A) erred in confirming the order of the AO by sustaining the disallowance of ₹ 19,62,575/- u/s 40A(3) read with rule 6DD(k) of Income tax Rules 1962. 8. The assessee during the year has made payment of ₹ 19,62,575 .....

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to whom the payment was made. The payment was made to payee in cash as the party denied to receive the same in cheque. As such, assessee would not have been able to carry on the business without making the cash payment to the party concern. Ld. AR pleaded that expenditure should be allowed on account of business expediency. On the other hand, Ld. DR submitted that payment made by assessee is against the provision of Sec. 40A(3) of the Act. The payment made by assessee also does not fall in any .....

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