In assessment under sec 143(3) difference with books of account should properly explained or addition can be made and interest under sec 234B can be charged.

IN THE INCOME TAX APPELLATE TRIBUNAL

(DELHI BENCH `D’: NEW DELHI)

BEFORE SHRI U.B.S. BEDI, JUDICIAL MEMBER AND

SHRI B.C. MEENA, ACCOUNTANT MEMBER

ITA No.134/Del./2011

(Assessment Year: 1996-97)

M/s Kuber Securities Ltd.,

C/o Raj Kumar & Associates, CA

4435/7, Ansari Road,

Darya Ganj,

New Delhi.

(PAN/GIR No.AADCK3522B)

(Appellant)

Vs.

ACIT, Circle 5(1),

New Delhi.

(Respondent)

Assessee by: Shri Harish Goel, AR

Revenue by: Ms. Y. Kakkar, Sr. DR

ORDER

PER U.B.S. BEDI, J.M.

This appeal of the assessee is directed against the order passed by the CIT(A)- VIII, New Delhi, dated 01.11.2010 relevant to assessment year 1996-97 whereby assessee has challenged confirmation of addition of Rs.59,504/- for difference in closing balances of shares account besides challenging charging of interest u/s 234B of the I.T. Act, 1961, when other grounds raised in the memo of appeal have not been pressed and endorsement to this effect has been made by Ld.Counsel for the assessee at the time of hearing.

2. As per original assessment u/s 143(3) of the Act, vide order dated 30.3.1999 on a total income of Rs.1,15,39,847/- when various additions/disallowances were made. Against such order of assessment, assessee filed appeal and CIT(A) vide order dated 31.12.2002 deleted all the additions/disallowance made in the assessment order. In second appeal, preferred by the Revenue before ITAT, set aside the order of CIT(A) and remanded the issues raised in the appeal back on the file of the Assessing Officer by observing that CIT(A) has not properly examined the whole issues and has not recorded  finding as to how the differences found in the account was reconciled and moreover, appeal of the assessee has been accepted by the CIT(A) without giving any opportunity to the Assessing Officer. So, the matter was restored back on the file of the Assessing Officer for de novo consideration with specific directions contained in para.6 of the ITAT order.

3. In compliance to the direction issued by ITAT in para.6 of its order, the Assessing Officer examined the whole issue all over again and three additions of Rs.7959/-, 59,504/- and Rs.29,509/- on account of differences in closing balance of cash in hand, difference in closing balance of shares account and undeclared interest including TDS respectively were made. Against which assessee preferred appeal, but was unsuccessful.

4. In further appeal, assessee only challenged addition of Rs.59,504/- for difference  in closing balances of shares account and other two additions were not pressed and grounds raised in this regard were withdrawn. Assessee has also challenged charging of interest u/s 234B of the Act, before first appellate authority came to be dismissed being mandatory and consequential in nature and it has further been challenged here.

5. Ld.Counsel for the assessee while reiterating the submissions made before the Assessing Officer and CIT(A) with regard to addition of Rs.59,504/- on account of difference in closing balance of shares account, Ld.Counsel filed copy of the balance sheet and contended that there is no difference in the amount appearing in the balance sheet under this head and assessee does not know how there is difference between the trial balance as per books of account and the amount recorded in the balance sheet, since correct amount has been recorded and shown in the balance sheet. Therefore, addition is not called for which may be deleted.

6. Ld.DR submitted that as per books of account and trial balance found by the Assessing Officer there was a clear difference of Rs.59,504/-, which difference assessee could not explain despite having remanded back the issue on the file of the Assessing Officer by ITAT and therefore, addition was called for. Even before CIT(A) assessee was not able to explain such difference and before this bench also, nothing has been placed on record to justify such difference. Therefore, addition has rightly been made by the Assessing Officer and confirmed by the CIT(A) whose action should be confirmed.

7. After hearing both the sides and considering the material on record, we find that the balance in the shares account is Rs.23,52,580/- whereas as per books of account and as per trial balance it is Rs.22,93,130/- and assessee has failed to explain the difference or substantiate his plea that there is no difference. As such, it is held that since assessee has not been able to explain the difference, therefore, addition is called for which has rightly been confirmed by the CIT(A) whose action is further confirmed and this ground appeal of the assessee is dismissed.

8. As regards charging of interest u/s 234B of the Act, we find that CIT(A) has rightly held that it is mandatory and consequential and since assessee has not been able to get any relief with regard to the additions made. Further, assessee could not be able to explain that interest charged is excessive. Therefore, we do not find any valid ground to interfere on this count and while rejecting the plea of the assessee in this regard, we  uphold the impugned order.

9. As a result, the appeal of the assessee is dismissed.

Order pronounced in open court on 17.02.2012.

                                                          Sd/-                                         Sd/-

                                                 (B.C. MEENA)                       (U.B.S. BEDI)

                                         ACCOUNTANT MEMBER    JUDICIAL MEMBER

Dated: February 17, 2012

SKB

Copy of the order forwarded to:-

1. Appellant

2. Respondent

3. CIT

4. CIT(A)-VIII, New Delhi.

5. CIT(ITAT)                                                                                     Deputy Registrar, ITAT