IN THE INCOME TAX APPELLATE TRIBUNAL JODHPUR BENCH, JODHPUR

BEFORE SHRI HARI OM MARATHA, JUDICIAL MEMBER AND

SHRI N.K.SAINI, ACCOUNTANT MEMBER

ITA No. 266/JU/2014 Assessment Year: 2009-10

Shri Virendra Singh Shekawat Vs. The Income-tax Officer Ward No. 10, Anoopgarh. Suratgarh PAN No. APNPS 3623 M (Appellant) (Respondent)

ITA No. 352/JU/2014

Assessment Year: 2008-09 The Income-tax Officer Vs. Shri Virendra Singh Shekawat Suratgarh Ward No. 10, Anoopgarh.

PAN No. APNPS 3623 M (Appellant) (Respondent)

Assessee by : Shri Suresh Ojha Department by : Shri Jai Singh, DR

Date of Hearing : 26.08.2014 Date of Pronouncement : 03.09.2014

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ORDER PER HARI OM MARATHA, J.M.

The above captioned cross appeals - one by the revenue

and the other by the assessee for A.Y. 2009-10 are directed

against the order of the ld. CIT(A) dated 12.3.2014 and are

being decided by this common order as, apart from the

assessee being the same in both the appeals, the issues

involved are also identical.

2. Briefly stated, the facts of the case are that the

assessee is a professional advocate, being Income-tax

Consultant and study Visa consultant practicing at Anoopgarh. During

the year, the assessee filed return of income declaring income at Rs.

2,82,180/- apart from disclosing agricultural income of Rs. 3 lakhs, as

against which assessment was completed at total income of Rs.

24,25,728/- vide order dated 23.12.2011 made u/s 144 of the Income-

tax Act, 1961 ['the Act' for short]. The A.O added professional account

income of Rs. 2,51,043/- and similarly, in the account of visa

consultancy an amount of Rs. 3,05,670/-. Both these additions are

estimated ones. Further, a sum of Rs. 8,34,585/- has been added on

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account of unexplained deposits and Rs. 4,52,300/- has been added

u/s 68 of the Act. Further addition of Rs. 90,000/- has been made on

account of low house hold expenses. Aggrieved, the assessee filed

appeal and the ld. CIT(A) has deleted some of the additions and

therefore, both the parties are now in appeal before the Tribunal.

2.1 The Revenue has raised the following grounds:

“On the facts and in the circumstances of the case the, Ld. CIT(A) has

erred in :-

(i) deleting addition of Rs. 2,01,043/- made on account of

professional receipt.

(ii) deleting addition of Rs. 3,05,617/- made on account of

consultancy receipt.

(iii) deleting addition of Rs. 8,34,585/- made on account of

unexplained investment.

(Iv) deleting addition of Rs. 4,82,300/- made on account of

unexplained cash credit.

(v) deleting addition of Rs. 2,00,000/- made on account of agriculture

expenditure.

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(vi) deleting addition of Rs. 1,65,000/- made on account of

professional receipt.”

2.2 The assessee has raised the following grounds:

“1. That the order passed by the Commissioner of Income-tax (A) is

illegal and against the law in respect of sustaining the addition.

2. That the Commissioner of Income-tax (A) should not have

sustained a sum of Rs. 50000.00 under the head of professional

receipt in absence of any contrary evidence.

3. That the addition sustained by the Commissioner of Income-tax

(A) Bikaner is arbitrary and against the law.

4. That the Commissioner of Income-tax (A) should not have

sustained a sum of Rs. 25000.00 under the head of house hold

expenses because the house hold expenses is quite reasonable

looking to the facts and circumstances of the case.

5. That the Commissioner of Income-tax (A) should have followed

the order of the Hon'ble Tribunal referred before the him.

6. Without prejudice to above the addition of the Rs. 50000.00

sustained under the head professional receipt and Rs. 25000.00

sustained under the head house hold expenses is excessive and

high.

7. That the charging of interest is illegal and against the law.”

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3. We have heard the rival submissions and have carefully

perused the relevant material on record. After considering

the rival submissions we are convinced that the deletions

made by the ld. CIT(A) and which are the subject matter of

the Revenue’s appeal are perfectly in order. We have found

that the assessment was made u/s 144 of the Act because the

assessee met with an accident and was hospitalized in

Kothari Hospital, which fact has not been denied by the

Revenue. Before the ld. CIT(A), written submissions was

filed which was sent to the A.O and after considering the

remand report of the A.O and after admitting additional

evidence as per rules, the ld. CIT(A) has considered the

following additions:

1. Enhancement of professional receipts Rs.2,51,043

2. Enhancement of Study consultancy Rs.3,05,617

3. Unexplained investment Rs.8,34,585

4. Unexplained cash deposit Rs.4,82,300

5. Addition against agriculture expenses Rs.2,00,000

6. Enhancement in household expenses Rs. 90,000

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4. We have found that the assessee did maintain his books

of account but could not produce the same before the A.O

due to the unfortunate incident of accident which he met.

The observation of the A.O that he did not maintain any

books of account is found to be not correct. The balance

sheet and return of income tally in respect of figures

mentioned in the balance sheet and return of income filed.

On 6.11.2013, the assessee appeared before the A.O and filed

his reply. The A.O directed him to produce the books of

account which could not be produced due to the

aforementioned reasons. Before the ld. CIT(A), the books of

account were produced alongwith sworn and duly attested

affidavit certifying assessee’s admission in hospital. In this

background, the ld. CIT(A) has admitted the additional

evidence. For another period during which the assessee was

hospitalized in Sharda Nursing Home from 6.11.2013 to

18.11.2013, a medical certificate has been produced.

5. The A.O has enhanced professional receipts by Rs.

2,51,043/- by estimating total such receipts at Rs. 5 lakhs

and since the assessee has disclosed receipts from his

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profession at Rs. 2,48,957/-, remaining amount of Rs.

2,51,043/- has been added.

6. After considering the rival submissions, we have found

that the estimation made by the A.O is unfounded and based

on no reason. The simple reason that the assessee is a

reputed advocate, practicing at Anoopgarh cannot be any

reason for making such wild estimations. Accordingly, the

enhanced estimated professional receipts to the extent of Rs.

2,51,043/- has been correctly deleted. Similarly, in case any

addition is made in respect of study visa consultancy. The

assessee has taken a franchisee of a company having agency

for admission abroad. As per agreement, 10% of tuition fees

is payable to this assessee. No charges for visa fees, e -visa,

etc. is chargeable by the assessee. The A.O has added total

amount received and deposited in his bank account to be

further forwarded to the institutions abroad through his

principal company from whom he has taken franchisee. The

A.O ahs estimated assessee’s income in this account without

any basis which has been deleted by the ld. CIT(A). We are

also in agreement with the finding of the ld. CIT(A) and ho ld

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that the impugned addition is based on adhoc estimation

based on no logic.

7. The facts of the third ground of Revenue’s appeal are

that from the debit and credit entries found in assessee’s

bank account on 28.8.2008, the A.O has added Rs. 8,34,585/.

Before the ld. CIT(A), copy of bank account in SBBJ was

produced and in this bank account, amount received by the

assessee from students for the purpose of remittance to the

foreign institutions where students want to get admission are

found deposited. The remittance of the amount to foreign

institutions was also established and the entries in this pass

book has been fully explained. The assessee received only

commission on such receipt of fees and not the entire amount

goes to his pocket. Accordingly, deletion of Rs. 8,34,585/- is

also found to be correctly deleted.

8. Ground No. 4 of Revenue’s appeal in respect of deletion

of addition of Rs. 4,82,300/- made on account of unexplained

cash credit in assessee’s accounts in SBBJ and ICICI,

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Anoopgarh certain deposits were found, details of which is as

under:

SBBJ 23.05.2008 25000

SBBJ 20.03.2009 89000

ICICI 21.04.2008 38300

ICICI 24.08.2008 330000

482300

9. Before the ld. CIT(A), the assessee explained each

deposit after mentioning name of the student a longwith copy

of passport and proof of remittance of fees belonging to that

student remitted to foreign institution. Thus the amount

credited in these banks stand fully explained. Moreover,

such addition cannot be made u/s 68 or u/s 69 of the Act

because a bank pass book is not a books of account.

Accordingly, the impugned addition is also quite in order.

10. Next ground is regarding deletion of addition of Rs. 2

lakhs made on account of agriculture expenditure and reason

for this addition is that the assessee has shown net income of

Rs. 3 lakhs from his agricultural activities but has not

disclosed the related expenses. Accordingly, on estimation

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basis, this amount has been added which has been deleted by

the ld. CIT(A) by holding to be a sheer baseless estimation.

11. After hearing both the sides, we fall in line with the

finding of the ld. CIT(A) and confirm the impugned deletion.

12. Last ground of this appeal is regarding deletion of Rs.

1,65,000/- made on account of professional receipts.

13. This ground has been disposed of in line with Ground No.

1 of this appeal. Accordingly, ground raised by the Revenue

in this appeal stands dismissed.

14. In assessee’s appeal, only two effective grounds have

been raised – one in relation to sustenance of addition of Rs.

50,000/- in the account of professional receipt and the other

one in the account of house hold withdrawals of Rs. 25,000/-.

Both these sustained additions are found to be baseless as we

have found the other additions made in assessee’s hands.

Accordingly, we cannot uphold the impugned additions and

delete them being baseless and without any reason.

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15. To sum up, the appeal of the assessee in ITA No.

266/JU/2014 for A.Y. 2009-10 stands allowed and the appeal

of the Revenue in ITA No. 352/JU/2014 for A.Y. 2009-10

stands dismissed.

Order Pronounced in the Court on 03 rd September, 2014.

Sd/- Sd/- (N.K.SAINI) [HARI OM MARATHA] ACCOUNTANT MEMBER JUDICIAL MEMBER Dated : 03rd September, 2014 VL/- Copy to:

1. The Appellant 2. The Respondent 3. The CIT By Order 4. The CIT(A) 5. The DR

Assistant Registrar ITAT, Jodhpur