TaxTMI 
TaxTMI 
2026 (5) TMI 1055
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..... Commissioner of Income Tax, Central Circle-29, New Delhi and has been authorized by Pr. CIT(Central)-3, New ITAT. Delhi to file appeal before the Hon'ble ITAT. 2. That the order of Ld. CIT(A)-30, New Delhi dated 18.08.2022 in Appeal No. 10529/2019-20 in the above-mentioned case was received in the office of Pr. CIT(Central)-3, New Delhi on 02/09/2022 and the date of limitation for filing before the Hon'ble ITAT was 01/11/2022. 3. That the Applicant/Appellant respectfully submits that there has been delay of 08 working days (being 05th and 6th November 2022 are Saturday and Sunday respectively) in filing appeal due to sufficient cause inspite of due procedure followed by the Applicant/Appellant. The said delay in filing the appeal has arisen in bona fide circumstances and for no fault or omission or negligence on the part of the Applicant/Appellant. 4. It is submitted that the addition in the case of the assessee M/s Shiv Shakti Traders for AY 2018-19 was made under section 69A of the Income-tax Act, 1961 which involved huge tax implication of Rs. 5.79 Crores. The addition was deleted by the Ld. CIT(A)-30, New Delhi vide its decision in Appeal No....
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....iv Kumar Tiwari a cash courier boy belonged to the assessee before us M/s Shiv Shakti Traders having its office at C-6, 6596, Vasant Kunj, New Delhi. As per statement recorded under Section 132(4) of the Act of Shri Shiv Kumar Tiwari such cash was handed over to him by one Shri Atul Bhatia who is also another cash courier boy of Shiv Shakti Traders. 5. A search operation thereafter was conducted by the Department in the name of the assessee wherefrom a letter was seized with wrong information written that the assessee AOP is assessed with Range-(38)1, New Delhi. Meanwhile, the AOP is assessed with Central Circle-29, New Delhi. Panchnama was drawn by the authorities and proceedings recorded under Section 132A of the Act a copy whereof is reproduced at page 3 of the assessment order on record. The assessee is engaged in the business of retail trade of liquor and the year under consideration received income chargeable to tax under the head 'income from business or profession' and 'income from other sources.' The original return was e-filed by the assessee for AY 2018-19 on 31.10.2018 declaring an income of Rs. 12,16,54,740/- and notice under Section 143(2) dated 27.....
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....period (total sum deposited in cash for relevant period Average per day sale during this period (total sum deposited in cash for relevant period / number of days) 01-04-2017 to 05- 05-2017 35 122369435 34,96,269 06-05-2017 to 30- 06-2017 56 99786294 17,81,898 01-04-2016 to 05- 05-2016 35 129145083 36,89,859 06-05-2016 to 30- 06-2016 56 174200495 31,10,723 14.7 From the above Table-VII it is revealed that the maximum average per day sale made in cash of the assessee during the period 01-04-2016 to 05-05-2016 was Rs. 36,89,859/- as against the average sale during same period in F.Y. 2017-18 i.e. from 01-04-2017 to 05-05-2017 was 34,96,269. So even if it is presumed that the accumulated cash balance was for 2 to 3 days, then also it does not explain the source of Rs. 7.5 crore cash at a single point of time. 14.8 The above Table-VII reveals that the average sale of the assessee for the period 01-04-2016 to 05-05-2016 and 06-05-2016 to 30-06-2016 was respectively Rs. 36,89,859/- and Rs. 31,10,723/-. This figure reveals that the trend of average per day sale in cash of the assessee from 01-4-2016 to 05-05-2016 and from....
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....here was no cash deposited on 05-05-2017. Therefore, even if sale of 05-05-2017 is considered to be available as cash in hand, that was too less to explain the possession of Rs. 7.5 crore. Therefore, no cash can be available in hands of assessee in respect of sales made prior to 05-05-2017. Moreover, it is also revealed that despite interception on 06-05-2017 of Rs. 7.50 crore in cash, the assessee has still deposited a sum of Rs. 2,77,70,500/- in cash in its bank account at ICICI Bank on 06-05-2017, which itself appears to be unrealistic considering the average daily sales of approx. Rs. 35 lacs only being shown by assessee in its books. Hence, there was hardly any cash available with assessee out of cash sales made prior to 06-052017 and the cash of Rs. 2.77 crore deposited on 06-05-2017 after seizure of Rs. 7.5 crore at 4 A.M. on 06-05-2017 is itself very suspicious. Hence, there is no way to believe that the cash of Rs. 7.5 crore seized in early morning at 4 A.M. of 06-05-2017 was out of cash sales made in earlier periods. Therefore, it reveals that the intercepted cash amount has no logical relation with sale proceeds of M/s Shiv Shakti Traders for its sale in Lucknow at vario....
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....ty from IC1C! Bank Branch, M.G. Marg, Hazratganj, Lucknow. Hence there was no need for assessee to have accumulated the cash received out of sales for a longer period of more than 2-3 days. The cash pickup facility agreement of M/s Shiv Shakti Traders with the ICICI Bank was obtained from the ICICI Bank branch, M.G. Marg, Hazratganj, Lucknow, which revealed that the limit for cash pick up by bank from M/s Shiv Shakti Traders was upto Rs. 50.0 lakhs-Rs. 1.0 crore per day. 14.15 The statement of the bank reveals that the bank was collecting the cash from the assessee on daily basis regularly. Hence, there was no chance of cash accumulating to Rs. 7.50 crore, if it were from cash sales, as the bank was regularly collecting the cash. 14.16 in view of the above analysis, it is clear that the assessee could not satisfactorily substantiate the source of the cash of Rs. 7.50 crore found and seized on 08-05-2017. The logic given by the assessee about the source of cash of Rs. 7.50 crore is merely a self cooked story. Therefore, the sum of Rs. 7.50 crore seized in cash remains unexplained income of the assessee M/s Shiv Shakti Traders for A.Y. 2018-19. 15. Further,....
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.... like cash book, bank book etc of the dealers / owners of the shops / vends of the assessee firm for F.Y. 2016-17 and the copy of monthly / annual VAT return for the period 01-04-2016 till 31-07-2017. But instead of furnishing the books of accounts of vends / shops of various dealer / shops of the firm merely stated the firm is having on registration number and the product is exempted from VAT. Therefore, we are not required to file separate returns for each city. Each shop is a separate entity having separate license holder and therefore, it should maintain its books of accounts separately. The consolidated books of accounts may be of the AOP but each shop should maintain separate books of accounts. 15.6 The assessee was also asked to provide the audited and verified balance sheet of Haldwani Branch alongwith details of payment made by Haldwani Branch to Lucknow Branch, so as to verify that Haldwani Branch had given Rs. 7.50 crore in cash or by other mode to Lucknow branch, in this regard, the assessee was specifically required to provide the date of payment made by Haldwani branch, amount paid by Haldwani branch to Lucknow branch, modes of payment by the Haldwani branch ....
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....oyees couldn't find a satisfactory reply to the Department. 3. Regular Notices were supplied to you through offline mode and ITBA System. 4. You have not discharged your onus that the money was your accounted and legal money. 5. You have just supplied a story that the bank has refused to deposit your cash. So you were carrying cash in Toyota Innova Car in 4 boxes. 6. Your bank statements has also revealed that during 01.04.2017 to 30.06.2017 cash was picked up regularly. 7. Further, you have not produced the audited books of accounts, cash book, bank book, monthly/annual VAT return of the 41 shops/vends. 8. You have also not supplied any written letter from the bank that the bank has refused to take/deposit the cash. 9. You have also not provide the satisfactory details about the date of payment made by Haldwani Branch, amount paid by Haldwani Branch to Lucknow Branch, mode of payment by the Haldwani Branch to Lucknow Branch, name of the person who received the said amount and account in which the said amount was deposited. 10. Further, you have stated that the cash of Rs. 7.50 crore transfer was done in th....
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.... maintained by him for any source of income, and the assessee offers no explanation about the nature and source of acquisition of the money, bullion, jewellery or other valuable article, or the explanation offered by him is not, in the opinion of the Assessing Officer, satisfactory, the money and the value of the bullion, jewellery or other valuable article may be deemed to be the income of the assessee for such financial year. " 19. As the assessee has failed to furnish any satisfactory explanation of the source of cash to Rs. 7,50,00,000/- is treated as unexplained money made by the assessee and added to the total income of the assessee u/s 69A of the Income tax Act. (Addition Rs. 7,50,00,000/-) In view of the above, I am satisfied that assessee has misreported and under-reported its income, therefore, penalty proceedings u/s 270A(9)(a) of the I.T. Act, 1961 are being initiated separately. 20. With the above remarks, total income of the assessee is computed as under :- Income as per return Rs. 12,16,54,740/- Add: Addition u/s 69A of the Act (as discussed above) Rs. 7,50,00,000/- Total Income Rs. 19,66,54,740/- ....
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....mismatch in the purchase bills or stock inventory was pointed out. Further once details were submitted on -15:05.2017, any manipulation if made thereafter, would have been easily detected. It is also important to mention that all the purchases of the appellant are subject to TCS u/s 206C of the Act and state Excise Duty. The purchases and stocks are also regulated by the State Excise Department. Therefore, the allegation of manipulation of purchases or sales in such a regulated environment cannot be accepted in absence of any credible evidence. 9.2 As regards the observation of Ld AO with respect to availability of cash on 05.05.2017 in Para 14.10 and 14.11 of the order, it is noted that the appellant has shown closing cash-in-hand of Rs. 8.05 crore in its cash book on 05.05.2017. Therefore, adequate cash was available in the books as on 05.05.2017. Regarding the deposit of cash of Rs. 2.775 crore in the bank on 06.05.2017 post seizure, it is noted that the appellant has credited receipt of cash from Varanasi Branch amounting to Rs. 2.275 crore on 06.05.2017 in the cash book. I have perused the cash book and the bank statement of Lucknow Branch for the month of May submitt....
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....e, and it cannot be the basis of making addition. 9.4 Regarding the non-submission of books of account of individual shops, the appellant has submitted that each shops are licensed vends by the State Government in the names of individuals, who come together to form AOP. These shops work selling points and maintain records of stock, purchases and sales. Only small expenses are met at the shop level all other records are maintained at the branch and head office level. This pattern is followed year after year and the same has been accepted by the Department in other assessment years assessed u/s 153A/143(3) without any adverse remarks. I find that the appellant has maintained and submitted shop wise record of sales, purchases and stock etc along with invoices to the Wing and Ld AO during the relevant proceedings for verification. Books are audited at consolidated (AOP) level which were accepted by the Department from year after year. Further Ld. AO did not find any fault in the audited books of the appellant and has also not rejected them. 9.5 In view of above facts and discussions, I find that the Ld. AO failed to bring on record any evidence/material to show that t....
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....said office only. The statement that the cash of Rs. 7.50 crores was collection of the assessee from liquor business which was being carried to deposit in the current account with the HDFC Bank, Nainital Road, Haldwani branch was not found to be satisfactory by the Ld. AO on the count that the comparative analysis as appeared at page 36 does not justify the source of such cash being only sale proceeds of the business of the assessee. In this regard, we have further considered the observations made by the Ld. AO in para 14.8 which has already been reproduced hereinabove. The per day average sale figure from 06.05.2017 to 30.06.2017 shows as irregular trends of sale in cash which does not match the sale for the period as discussed therein particularly in view of the fact that as per sale bills produced by the assessee before the Ld. AO for the period 06.05.2017 to 30.06.2017 is very lesser than the average from per day sale made by the assessee during the same period in previous year i.e., 06.05.2016 to 30.06.2016 which is only Rs. 17,81,898/- and Rs. 31,10,723/- respectively which justifies back dated sales record for the period 06.05.2017 to 30.06.2017 into the period of 01.04.2017....
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....e sum of cash from Lucknow to Haldwani. Therefore, the observation that unexplained money sought to be transferred from somewhere to elsewhere as observed by the Ld. AO seems to be acceptable. We also concur with the view of the Ld. AO made in para 15.1 of the order. 11. Even the cash balance of 223 days is not sufficient enough to explain the source of Rs. 7.5 crores at any single point of time as also observed by the Ld. AO. Paras 14.8 and 14.9 of the order passed by the Ld. AO also is found to be acceptable. The Table III as reproduced by the Ld. AO reflects substantial cash deposit in the bank account at ICICI Bank Lucknow since 01.04.2017. Though there was no cash deposit on 05.05.2017 and even if the cash sales of 05.05.2017 is considered as the source of cash deposit, the same is too less to explain the position of Rs. 7.5 crores. It further reveals that despite interception on 06.05.2017 of Rs. 7.50 crores cash the assessee still deposited a sum of Rs. 2,77,70,500/- in cash in its bank account lying with ICICI Bank on 06.05.2017 which appears to be unrealistic considering the average daily sales of Rs. 35 lakhs only as shown by the assessee in its books of account. There....
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....s supposed to maintain separate books of account, the consolidated books of account of the AOP cannot justify the sales of each and every shop's accumulation which was claimed to be total source of Rs. 7.50 crores cash intercepted and seized from the Innova car on 06.05.2017. We find that the Ld.CIT(A) without going into the details of the matter has passed order admittedly ambiguously accepting the plea of the assessee and no deliberation has been made by the Ld.CIT(A) on non production of separate books of accounts by the separate shops particularly sales made by the separate shops at Lucknow which claimed to be the entire source of impugned cash seized of Rs. 7.50 crores. 16. Therefore, neither the source of cash of Rs. 7.50 crores intercepted and seized nor the modus operandi of carrying cash can be said to be justified. The plea of transferring the cash from Lucknow to Haldwani which was received by the assessee during demonetization from Haldwani office in the absence of any corroborative evidence is also found to be frivolous and also an afterthought and, thus, not sustainable which was one of the core reasons in allowing the appeal preferred by the assessee by the Ld....
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.... Sheyshoke Tracert Lucknow 9-6-2017 45,00.000 00 Smvshaws Traders Lucknow 7-6-2017 15,00,000 00 Srevshast Triders Lucknow 6-6-2017 20,00.000.00 finivwhakt Traders Lucknow 6-6-2017 13,00,000 00 Shivshaks Traders Lucknow 3-8-2017 20.00,000.00 Shivshaks Traders Lucknow 2-6-2017 50,00,000 00 Shivshant Traders Lucknow 31-05-2017 50.00.000 00 Stevshaks Traders Lucknow 30-05-2017 60.00.000.00 29-05-2017 50.00,000 00 26-05-2017 35.00.000 00 24-05-2017 45.00 000 00 22-05-2017 1,25.00 000 00 20-05-2017 40.00.000 0G 16-05-2017 20.00.000 0℃ Shvshgát Traders Lucknow Shegnats Tragers Lucknow Shivshaks Tradue Lucknow Shivshakti Traders Lucknow Shivghakt Traders Lucknow Stuvshart- Traders Lucknow She shakti Traders Lacknow 17-05-2017 50.00,000.00 Muiul Sangre Sanjay Stuur'ya S & Bisira Mukul Singh/ Sanjay Sharena $ 5 Binga Mukul Singh: Sanjity Shanna Mukul Smigły Sanjay Sharma MuMIA Sınghy Surja, Sharma $ 9 Bindra Mukul Sirigty Sanpey Sharma' Muh 'Singri Sagt Shanda 16-05-2017 50.00.000 00 9-5-2017 45.00,000 00 9-5-2017 25.00.000 00 8-5-2017 40,0....
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....e Nale April. Joie April, 2017 Apin, 2017 May, 2016 May, 2016, Muy. 2017 slune, 2016 Jure. 2010 June, 2017 June. 2019 And so on Ine remosmiog And 3016 And 2017 And - peritat of 2016 Document 3 Government of India Offee of the Deputy Director of Income Tax (inv.).J Anyshar Ubawan, 8-Ashok Marg. Hazratganj. Lucknow. -- ------ Telefax: 0522-2233308 V.No. DDIT (Inv.|-I/Lko/Shiv Bhakati/2017-18 Date: 30.01.2018 To The Principal Officer, M/s Shiv Shakti Trailers Plot No. 8. 4-8hạnh nachf Rand. Lak komt Subs Calling for Information a/s 13 1(1A) of the I.T. Act- 1961-Reg 2 Drialix of shops fram which the cash belonged to (which was muchointhe file Monly in the folkirving Satset alongwith documentary evalence at (Toas xhopi scovidnig vital alongwith copy of ITR-V & audit report along"al halnace sheet, P & L a/e for A.V.2016-17 & 2017-18 LATEST ITR Complets break-up of shop-wise solred cush SL No. Name Dealer/Owner of the shop of Address of the PAN the flied Shop Détails Äể shap nÆ°á»›c stál pár dsich-việc sole- of thèse shops/ deiers và thẻ Bắtnaing forwi....