Income Tax Appellate Tribunal (ITAT), Ahmedabad bench consisting of Pramod M Jagtap, Vice President and Suchitra R Kamble, Judicial Member upheld addition of Income from Cricket Betting as Business Income applying 1% of Gross Profit.
The assessee, Shri Kashyap Suresh Brahmbhatt is an individual. The Vigilance Squad of State Police, Gandhinagar conducted a raid at his residential premises. During the course of the said raid, cash of Rs.43,88,500/- was found and seized besides some incriminating documents and articles such as laptops, mobiles, TV etc. On the basis of the information received relating to this raid conducted by the Vigilance Squad of State Police, Gandhinagar and the seizure of cash and incriminating documents and articles, an authorization under Section 132A of the Income-tax Act was issued. An application was also made before the Additional Chief Judicial Magistrate for requisition of assets, in response to which the police authority was directed by the Court to handover all seized assets which were ultimately requisitioned under Section 132A.
Although a different stand was taken by the assessee in respect of cash of Rs.43,88,500/- found during the course of raid, he finally claimed that he was engaged in the business of real estate agency and the said cash represented his commission income earned from the said business. Consequent to action under Section 132A of the Act, proceedings under Section 153A of the Act were initiated in the case of the assessee inter alia for both the years under consideration i.e. AY 2011- 12 and 2012-13 by issuing notices. During the course of assessment proceedings, copies of printouts taken from the seized laptops were provided to the assessee and he was asked to explain the transactions of Rs.33,09,01,900/- and Rs.111,48,49,350/- relating to AYs 2011-12 and 2012-13 respectively as found recorded in his laptop.
The Assessing Officer thus estimated the income of the assessee at Rs.33,09,019/- and Rs.1,11,18,493/- from the business of cricket betting for AYs 2011-12 and 2012-13 respectively being 1% of the total transactions as found recorded in the seized laptops and made addition to that extent to the total income of the assessee in the assessments completed under Section 143(3) and 153A of the Act. The CIT(A) did not find merit in the said submission made on behalf of the assessee and proceeded to confirm the additions of Rs.33,09,019/- and Rs.1,11,18,493/- made by the Assessing Officer.
The Tribunal held “we are of the view that the estimate made by the Assessing Officer of the assessee’s income at 1% of the total transactions of cricket betting as found recorded in the laptops seized from the possession of the assessee is quite fair and reasonable and the learned CIT(A) was fully justified in confirming the same.”
Subscribe Taxscan Premium to view the JudgmentBuy books of essential tax practice with exciting offers at shopscan.in
