TMI Blog2020 (4) TMI 584X X X X Extracts X X X X X X X X Extracts X X X X ..... eposits reflected in the bank account. Following the ratio laid down in the case of CIT V. Pradeep Shantilal Patel [ 2013 (11) TMI 1646 - GUJARAT HIGH COURT] wherein it was held that where assessee admitted that cash deposits pertained to his retail business but details and nature of business were not forthcoming from record, considering total turnover of assessee, net income to be determined under section 44AF AO is directed to estimate net profit @ 5% of total turnover of ₹ 15,11,906 being cash deposits in bank account. - AO will allow set off the amount of ₹ 75,000 disclosed in her income-tax return. In other way, the set off and telescoping would be allowed of ₹ 75,000 disclosed in return of income and considered by the AO in assessment order. This grounds of appeal is therefore, partly allowed. - I.T.A No. 354/SRT/2017 - - - Dated:- 10-2-2020 - Shri Sandeep Gosain, Judicial Member And Shri O.P. Meena, Accoutant Member For the Assessee : Shri Suresh K. Kabra, CA For the Revenue : Mrs. Anupama Singla, Sr.D.R. ORDER PER O. P. MEENA, AM: 1. This appeal by the Assessee is directed against the order of learned Commissioner of Incom ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment proceedings regarding the reopening of the assessment. The appellant had filed the return of income in compliance to notice under section 148 of the Act and participated in the reassessment proceedings. This issue of reopening being bad in law was raised for the first time during the appellate proceeding. Therefore, the objection raised by the appellant regarding the assumption of jurisdiction by the AO by issuance of notice under section 148 of the Act, is devoid of merits, and facts. The Ld. CIT(A) further observed that the appellant did not file any return of income in response to notice under section 148 within the statutory period of 30 days. The appellant did not file any objection on the reopening of the assessment proceedings before the AO and it was only during the appellate proceedings, the appellant has raised an objection on the reopening. It is a settled law that any return filed after the stipulated time as per the notice under section 148 of the Act is to be treated as nonest. The Ld. CIT(A) therefore, referred the conditions laid down in the provisions of section 124 (3) and of observed that the plain reading of clauses (b) of subsection 3 of section 124 mak ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... deposits in saving bank account, but no return of income was filed by him. Therefore, placing reliance in the case of Bir Bahadur Singh Sijwali v. ITO [2015] 53 taxmann.com 366 (Delhi-Trib) and Gurpal Singh v. ITO [2016] 71 taxmann.com 108 (Amritsar-Trib) submitted that that the assessee made cash deposits in bank account, on the fallacy of presumption that bank deposits constructed undisclosed income or looking fact that source of deposits need not necessarily of income of the assessee, assessment proceedings sought to be initiated were to be set aside. 6. On the other hand, the learned Sr. D.R. submitted that the assessee has not made any compliance of the notice issued under section 148 of the Act within the statutory period, therefore, the assessee cannot take the this ground of jurisdiction as the Ld. CIT(A) has already held the return filed beyond due date as nonest. Further, while reopening of assessment prima-facie reason are to be looked into only. The case laws relied by the learned Counsel are distinguishable on facts and not binding for the assessee authorities, as these are pertains to non-Jurisdictional tribunals. 7. We have heard the rival submissions and perus ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 148 of the Act. Similarly, in the case of Gurpal Singh (supra), the tribunal observed that inquiries made through notice under section 133(6) were not having valid sanction of competent authority and it can be resorted to only where no proceeding was pending after approval of Commissioner of income tax. Since, in that case proceeding were not pending hence, the issue of notice under section 133(6) and consequently, issue of notice under section 148 of the Act was found without jurisdiction. In the present case, these facts are absent. Moreover, the assessee has not filed return of income within statutory period of notice under section 148 of the Act hence, the assessee was debarred from taking objection to issue of jurisdiction, specifically when she has not complied with proceeding and not raised any objection to issue of notice under section 148 of the Act during the course of assessment proceedings. In view of these facts and circumstances, we uphold the reopening of assessment as valid and in accordance with law. In view of this matter, this ground of appeal is therefore, dismissed. 8. Ground No. 2 relates to confirming addition of ₹ 15,11,906 of whole deposit in b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and sell it in the open market. They opened the bank account with the bank of Baroda on 18. 01. 2007 as Surat. This was the saving bank account. This account was in joint account with the name of the assessee as first and her husband as second joint holder. The assessee used to purchase Jari from PHERIYA who used to come to their house with full bag of Jaris. She sold the said jari same as style PHERIYA in Farrukhabad. As the assessee and her husband were illiterate and this business being economical and started with on capital of ₹ 35,00 to ₹ 40,000 lying with them. Thus, they used to deposit the money in bank account being sale of jari and purchase goods and then again sell the goods to as FHERIYA coming to their house. For these reasons, they did not have these documents of purchases and sales. However, the assessee has shown profit from the business by disclosing total income at ₹ 75,000, which is more than by 5% as per proviso of section 44AF of the Act. Therefore, the AO was not justified in making addition of total deposits appearing in their bank account. The learned Counsel further submitted that the bank accounts also shows cash deposits as well as ca ..... X X X X Extracts X X X X X X X X Extracts X X X X
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