Manoj Kumar Gupta v. Principal Commissioner of Income-tax, Agra And Another
[Citation -2020-LL-0113-12]

Citation 2020-LL-0113-12
Appellant Name Manoj Kumar Gupta
Respondent Name Principal Commissioner of Income-tax, Agra And Another
Court HIGH COURT OF ALLAHABAD
Relevant Act Income-tax
Date of Order 13/01/2020
Assessment Year 2007-08
Judgment View Judgment
Keyword Tags substantial question of law • assessment proceedings • memorandum of appeal • commission income • assessment order • banking channel • peak credit • interest • unexplained source of income • unexplained deposit
Bot Summary: It is expected from the assessee in these notices that, in addition to the disclosure of the source of aforesaid amount, he clarifies in his balance sheet filed during tax assessment proceedings as to whether the balance shown in Kotak Mahendra Bank apart from entries of the year in question is balance on 13-2-2009 or on 31-03-2007. Whereas the reality is that since the assessee, earlier, did not have any account at all but on having been demanded during the tax assessment proceedings, he prepared all the accounts just in hurry and committed mistake. Since in this tax assessment year the assessee has shown gross income of Rs- 2,17,635/- in his income-tax details, therefore the rest amount Rs.- 9,25,808/- is added to the income of the assessee. As per the aforesaid, the tax of the assessee is assessed on the income of Rs.- 11,43,443/-. Date: 21.12.2009 Sd/- Illegible J.P. Tewari Income Tax Officer 4 Agra Against this order of assessement, the assessee, preferred an appeal before the Commissioner of Income Tax Appeal - II raising certain grounds which have been quoted in the order of the learned Appellate Tribunal dated 2nd May, 2016. We may state that the assessee could not establish with any evidence that he merely received commission income and the cash was received from the parties to whom or on whose behalf cheques were purportedly issued. It is settled law that any sum found credited has to be explained as to its nature and source by the assessee which in our considered view, assessee has failed to explain in the present case.


(1) Court No. - 7 Case :- INCOME TAX APPEAL No. - 137 of 2018 Appellant :- Manoj Kumar Gupta Respondent :- Principal Commissioner Of Income Tax, Agra And Another Counsel for Appellant :- Suyash Agarwal Counsel for Respondent :-Manu Ghildyal Hon'ble Biswanath Somadder,J. Hon'ble Ajay Bhanot,J. This appeal was admitted on substantial question of law as framed in memorandum of appeal, which reads as follows:- (i) "Whether Appellate Tribunal was legally justified in upholding estimation of peak credit made by A.O. without rejecting books of accounts?" In facts of instant case, we notice that assessment order was passed on 21th December, 2009, relevant portion whereof is reproduced hereinbelow along with its english translation :- In this regard, show cause notices were issued to assessee on 25-11-2009 and 30-11-2009. It is expected from assessee in these notices that, in addition to disclosure of source of aforesaid amount, he clarifies in his balance sheet filed during tax assessment proceedings as to whether balance shown in Kotak Mahendra Bank apart from entries of year in question is balance on 13-2-2009 or on 31-03-2007. In this regard, assessee has disclosed in his reply dated 08- 12-2009 that entry of account in Kotak Mahindra Bank and (3) some other entries were rendered wrong in tax assessment year 2007-08 due to computer virus. This statement of assessee is not admissible that because of virus, entry of account of Kotak Mahindra Bank could not be posted in accounts of year in question. Whereas reality is that since assessee, earlier, did not have any account at all but on having been demanded during tax assessment proceedings, he prepared all accounts just in hurry and committed mistake. He has fabricated all accounts. He is not able to verify sale-purchase which he has shown in these accounts. It is evident from aforesaid that assessee transfers rupees by misusing banking channel, and even having been given opportunity again and again, he has been unable to make clear peak credit of amount deposited in his bank- account. Therefore, in this tax assessment order, peak credit of Rupees 11,43,443/- deposited in aforesaid bank accounts is considered as deposited by assessee through his undeclared sources and is considered as his income of year in question. Since in this tax assessment year assessee has shown gross income of Rs- 2,17,635/- in his income-tax details, therefore rest amount Rs.- 9,25,808/- is added to income of assessee. Addition Rupees- 9,25,808/- As per aforesaid, tax of assessee is assessed on income of Rs.- 11,43,443/-. Demand letter and challan be issued and interest be separately charged as per rule under sections 234A, 234B, 234C. As well, penalty notice also be issued under section 271(1) (c) of Income Tax Act, because (4) assessee has concealed his income and submitted false details/evidence in this regard. Date: 21.12.2009 Sd/- Illegible J.P. Tewari Income Tax Officer 4 (2) Agra (English Translation by Court) Against this order of assessement, assessee (being appellant before us), preferred appeal before Commissioner of Income Tax Appeal - II raising certain grounds which have been quoted in order of learned Appellate Tribunal dated 2nd May, 2016. learned Appellate Tribunal, while disposing of appeal, has made following observation in paragraph 6, which is relevant for purpose of answering question of law sought to be raised before us:- 6. "We may state that assessee could not establish with any evidence that he merely received commission income and cash was received from parties to whom or on whose behalf cheques were purportedly issued. No worthwhile evidence has been led in this regard. It is settled law that any sum found credited has to be explained as to its nature and source by assessee which in our considered view, assessee has failed to explain in present case. Both authorities have been fair enough to tax peak credits. Ld. Counsel tried to rework amount of peak credits but we are not impressed with that working and said working is self serving. We do not find any infirmity in orders passed below. Therefore, action of lower authorities is confirmed and addition sustained by Ld. CIT(A) is also upheld by us". (5) plain reading of above clearly reveals that in fact situation of case, learned counsel had tried to rework amount of peak credits, but learned Appellate Tribunal was not impressed with that working since it was self serving. As such, in facts and circumstances of instant case, learned Appellate Tribunal cannot be held to have not been legally justified in upholding estimation of peak credit made by Assessing Officer without rejecting books of accounts. As such, order of learned Appellate Tribunal does not warrant any interference on basis of substantial question of law as raised before us and appeal stands disposed of accordingly. Order Date :- 13.1.2020 Pravin / Neeraj (Biswanath Somadder,J.) (Ajay Bhanot,J.) Manoj Kumar Gupta v. Principal Commissioner of Income-tax, Agra And Another
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