I TA N o. 20 9/ RP R/ 2 01 4 As s ess m e nt Ye r: 20 11 - 1 2 Page 1 of 4 IN INCOME TAX APPELLATE TRIBUNAL, RAIPUR BENCH, SMC , RAIPUR [Coram: Pramod Kumar AM] ITA No.209/RPR/2014 Assessment Year: 2011-12 Mukesh Kumar Jain, .Appellant C/o. Ratan Kumar Nirmal Kumar Jain, Chhota Bazar, Chirmiri Dist. Korea (C.G.) [PAN: ADGPJ 1074 L] Vs. Income Tax Officer, Ward 2(3), Bilaspur (C.G.) ...... .Respondent Appearances by: R.B. Doshi, for appellant D.K. Jain, for respondent Date of concluding hearing: 23.06.2016 Date of pronouncing order : 22.09.2016 O R D E R By way of this appeal, assessee appellant has challenged correctness of order dated 28.04.2014, passed by learned CIT(A), Bilaspur (C.G.), in matter of assessment under section 143(3) of Income Tax Act, 1961 for assessment year 2005-06, on following ground :- 1. In facts and circumstances of case, learned Commissioner of Income-tax (Appeals) erred in confirming addition of Rs.6,88,586/- made by Assessing Officer on account of alleged net profit @ 8% on sales of Rs.86,07,321/-. addition made by Assessing Officer and confirmed by CIT(A) is not justified. 2. To adjudicate on this appeal only few material facts need to be taken note of. During course of assessment proceedings Assessing Officer noted that while assessee has produced bank statement, Profit & Loss account and Ledger I TA N o. 20 9/ RP R/ 2 01 4 As s ess m e nt Ye r: 20 11 - 1 2 Page 2 of 4 etc. on total sales/turnover of Rs.78,29,905/-, assessee has not audited his books of account under section 44AB, hence book result is not reliable and not acceptable. Assessing Officer was of view that as books of account have not been audited, books of accounts were not maintained by assessee. It was in this back drop Assessing Officer proceeded to estimate profit @ 8% on basis of total cash/cheque deposits by assessee in his bank account. These deposits aggregate to Rs 86,07,321/- and profit so calculated comes to Rs.6,88,586/-. Aggrieved, assessee carried matter in appeal before learned CIT(A) but without any success. While doing so, learned CIT(A) has observed as follows:- Decision - appellant filed return of income in ITR-SAHAJ declaring income from other sources as per "Chapter TV F" at Rs. 1,64,036/-. As per computation of total income filed alongwith return, interest received from M/s. Ratan Kumar Nirmal Kumar Jain is Rs. 43,836/-, other income is Rs. 96,200/- and other interest income is Rs. 24,000/-, thus totaling to Rs.1,64,036/-. appellant has disclosed income in returns of earlier years under head 'Income from Other Sources'. This year, as evident from above, appellant has only income from other sources and not any income from other heads. case was picked up for scrutiny through CASS basically for purpose of verification of source of huge cash deposits in appellant's bank account bearing No. 10958003145 with SBI, Chirirmiri. total deposits made in above bank account during year under consideration is Rs. 86,07,321/-. appellant produced Profit and Loss A/c, Balance Sheet and other details in course of assessment proceedings in his efforts to create evidence favorable to him to justify that whatever deposits and withdrawals made in account were turnover and related expenses of his business in retail trading of consumer goods with plea that income from business was inadvertently included with income from other source due to ignorance of law and that books of account were not audited since it was first year of business activities in retail trading. Such ignorance of law is not excuse for non-compliance with law of disclosing business income separately under separate head and to get books of accounts audited. [Relied on CIT Vs. Lloyed Institution (I) (P) Ltd. reported in 164 CTR 196 (SC)]. return was filed in form where there was no liability of appellant to maintain books of account or to furnish details of assets and liabilities with Department. It was only when appellant's case was selected for scrutiny, he came up with details of purchases and sales relating to his retail trading in consumer goods so that source of deposits and purpose of withdrawals in alleged bank account I TA N o. 20 9/ RP R/ 2 01 4 As s ess m e nt Ye r: 20 11 - 1 2 Page 3 of 4 could possibly be furnished. AO ignored details furnished in course of assessment proceedings as after thoughts simply because of fact that such information are not available in return filed with him. It is true that appellant could establish purchases made from single supplier M/s. Fashion Suiting Private Limited by producing bills, but fact remains same that transactions in bank account and profits from retail trading in consumer goods is undisclosed. In given facts and circumstances of case, I find that AO is reasonable enough in treating deposits in bank account as turnover from his undisclosed retail trading business, applied presumptive rate only as provided in amended provisions of section 44AD of Act and added Rs.6,88,5867- to returned income and hence, no further interference in order of Assessing Officer is warranted. Accordingly, ground of appeal is rejected. 3. Assessing Officer is not satisfied and is in appeal before me. 4. I have heard rival contentions, perused material on record and duly considered facts of case in light of applicable legal position. I find that only reason of Assessing Officer deciding to ignore book result is that these books of accounts were not audited. Consequence of books of account not being audited despite requirement for getting books audited under section 44AB is set out separately. Once books of account has been produced by assessee and relevant details are duly submitted by him in which no discrepancies have been pointed out by Assessing Officer, it cannot be open to Assessing Officer to disregard book results. In this view of matter, in my considered view, there was no occasion for Assessing Officer to disturb Net Profit from business disclosed by assessee. addition made by Assessing Officer is devoid of any legally sustainable merit. Therefore, I delete same. 5. In result, appeal is allowed. Pronounced under rule 34(4) of Appellate Tribunal Rules 1963 today on 22nd day of September, 2016. Sd/- Pramod Kumar (Accountant Member) Dated: 22 nd day of September, 2016. I TA N o. 20 9/ RP R/ 2 01 4 As s ess m e nt Ye r: 20 11 - 1 2 Page 4 of 4 PBN/* Copies to: (1) appellant (2) respondent (3) CIT (4) CIT(A) (5) DR (6) Guard File By order Assistant Registrar Income Tax Appellate Tribunal Raipur Bench, Raipur Mukesh Kumar Jain v. Income Tax Officer, Ward – 2(3), Bilaspur