K.Sudheer, Eluru V. THE ITO, Eluru

CO 39/VIZ/2014

• Counselvise Citation: [2016] 123 COUNSELVISE.COM (IT) 2256 (ITAT-VISAKHAPATNAM)
• Duration Of Justice: 1 year(s) 5 month(s) 3 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 31-03-2016
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2010-2011
• Appeal Filed On: 27-10-2014
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Unexplained cash credit; Additional evidence
• Section: 142(1); 68

Judgement Text

ITA NO.161/VIZAG/2014 SRI KANIGOLLA SUDHEER, ELURU 1 , , IN THE INCOME TAX APPELLATE TRIBUNAL, VISAKHAPATNAM BENCH, VISAKHAPATNAM . , . , $ BEFORE SHRI V. DURGA RAO, JUDICIAL MEMBER & SHRI G. MANJUNATHA, ACCOUNTANT MEMBER ./I.T.A.NO.161/VIZAG/2014 ( / ASSESSMENT YEAR: 2010-11) ITO , WARD - 1 , ELURU VS. SRI KANIGOLLA SUDHEER ELURU [PAN: ARUPK1046K ] ( % / APPELLANT) ( &'% / RESPONDENT) C.O. NO.39/VIZAG/2014 (ARISING OUT OF I.T.A.NO.161/VIZAG/2014) ( / ASSESSMENT YEAR: 2010-11) SRI KANIGOLLA SUDHEER ELURU VS. ITO , WARD - 1 , ELURU ( % / APPELLANT) ( &'% / RESPONDENT) / APPELLANT BY : SHRI M.N. MURTHY NAIK, DR / RESPONDENT BY : SHRI G.V.N. HARI, AR / DATE OF HEARING : 24.03.2016 / DATE OF PRONOUNCEMENT : 31.03.2016 ITA NO.161/VIZAG/2014 SRI KANIGOLLA SUDHEER, ELURU 2 / O R D E R PER G. MANJUNATHA, ACCOUNTANT MEMBER: THIS APPEAL FILED BY THE REVENUE AND CROSS OBJECTIO N FILED BY THE ASSESSEE, ARE DIRECTED AGAINST THE ORDER OF COMMISS IONER OF INCOME TAX (APPEALS), VISAKHAPATNAM DATED 22-02-2014 AND I T PERTAINS TO THE ASST. YEAR 2010-11. SINCE, THE ISSUE INVOLVED IN TH ESE APPEALS ARE COMMON, THEY ARE CLUBBED, HEARD TOGETHER AND DISPOS ED OFF, BY WAY OF THIS COMMON ORDER FOR THE SAKE OF CONVENIENCE. 2. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSE E IS AN INDIVIDUAL, FILED HIS RETURN OF INCOME FOR THE A.Y.2010-11 ON 9 -9-2010 DECLARING TOTAL INCOME OF RS. 2,92,240/-. THE CASE HAS BEEN S ELECTED FOR SCRUTINY, ACCORDINGLY, NOTICE UNDER SEC. 143(2) AND 142(1) OF THE INCOME TAX ACT, 1961 WERE ISSUED. IN RESPONSE TO NOTICE, THE AUTHOR ISED REPRESENTATIVE OF THE ASSESSEE APPEARED AND FILED NECESSARY DETAIL S. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE A.O. NOTICED THAT TH E ASSESSEE IS OPERATING A SAVINGS BANK ACCOUNT AT ICICI BANK ELUR U, WHICH WAS FOUND CREDITED WITH CASH DEPOSITS OF RS. 34,00,000/- ON 5 DAYS BETWEEN 25-1- 2010 TO 24-3-2010. THEREFORE, ISSUED A SHOW CAUSE N OTICE ON 9-7-2012 AND ASKED TO EXPLAIN THE NATURE AND SOURCE OF CASH DEPOSITS INTO THE BANK ACCOUNT. IN RESPONSE TO SHOW CAUSE NOTICE, THE ASSESSEE NEITHER ITA NO.161/VIZAG/2014 SRI KANIGOLLA SUDHEER, ELURU 3 APPEARED NOR FURNISHED ANY DETAILS. THE A.O. ISSUED FURTHER LETTER ON 19- 10-2012 AND REQUESTED TO FURNISH THE DETAILS WITH R EGARD TO CASH DEPOSITS. IN RESPONSE LETTER, THE ASSESSEE NEITHER APPEARED NOR FURNISHED ANY INFORMATION. SINCE, NO INFORMATION IS COMING FROM THE ASSESSEE, THE A.O. HAS TREATED TOTAL CASH DEPOSITS OF RS. 34,00,000/- AS UNEXPLAINED CASH CREDIT AND BROUGHT TO TAX U/S 68 O F THE ACT. 3. AGGRIEVED BY THE ASSESSMENT ORDER, THE ASSESSEE PREFERRED AN APPEAL BEFORE THE CIT(A). BEFORE THE CIT(A), THE AS SESSEE FILED ADDITIONAL EVIDENCE BY FILING PETITION FOR ADMISSIO N OF ADDITIONAL EVIDENCE AND SUBMITTED THAT THE IMPUGNED CASH DEPOSITS WERE RECEIVED FROM M/S AMBICA CHANNAKESHAVA PROJECTS LIMITED, HYDERABAD FO R THE PURPOSE OF PURCHASE A PROPERTY FOR THAT COMPANY. THE ASSESSEE FURTHER SUBMITTED THAT HE HAD OBTAINED A CONFIRMATION LETTER ON 9-12- 2012 AND THE SAME HAS BEEN SUBMITTED TO A.O. ON 10-12-2012. HOWEVER, BY THE TIME THE A.O. HAS COMPLETED THE ASSESSMENT, THEREFORE NOT CO NSIDERED THE CONFIRMATION LETTER. DURING THE COURSE OF APPELLATE PROCEEDINGS, THE ADDITIONAL EVIDENCES FILED BY THE ASSESSEE WERE FOR WARDED TO THE A.O. FOR HIS COMMENTS. THE A.O. VIDE HIS REMAND REPORT D ATED 4-11-2013 AND 3-1-2014 SUBMITTED THAT THE SOURCES FOR THE CASH DE POSITS HAS BEEN VERIFIED WITH REFERENCE TO CONFIRMATION LETTER, LED GER ACCOUNT COPY, CASH BOOK AND INCOME TAX RETURNS OF COMPANY AND FOUND TH AT THE CASH ITA NO.161/VIZAG/2014 SRI KANIGOLLA SUDHEER, ELURU 4 DEPOSITS IN ASSESSEE BANK ACCOUNT WERE DRAWN FROM T HE COMPANY ON RESPECTIVE DATES. THEREFORE, THE A.O. CONCLUDED THA T THE IDENTITY, CREDIT WORTHINESS AND GENUINENESS OF THE TRANSACTION IS PR OVED AND THE ADDITIONAL EVIDENCES FILED BY THE ASSESSEE MAY BE A CCEPTED. THE CIT(A), AFTER CONSIDERING THE ADDITIONAL EVIDENCES FILED BY THE ASSESSEE AND ALSO TAKEN INTO ACCOUNT THE REMAND REPORT OF THE A.O. DE LETED THE ADDITION OF ` 34,00,000/- MADE UNDER SEC. 68 OF THE ACT. AGGRIE VED BY THE CIT(A) ORDER, THE REVENUE IS IN APPEAL BEFORE US. 4. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE MA TERIALS AVAILABLE ON RECORD. THE A.O. MADE ADDITION UNDER S EC. 68 TOWARDS CASH DEPOSITS FOR THE REASON THAT THE ASSESSEE HAS NOT F ILED ANY EVIDENCE TO PROVE THE NATURE OF CREDIT AND SOURCE FOR CREDIT IN THE BANK ACCOUNT. DURING THE COURSE OF APPELLATE PROCEEDINGS, THE A.O . HAS ISSUED A REMAND REPORT DATED 3-1-2014 AND HAS ACCEPTED THE A DDITIONAL EVIDENCES FILED BY THE ASSESSEE AND CONCLUDED THAT THE ASSESSEE HAS PROVED THE IDENTITY, CREDITWORTHINESS AND GENUINENE SS OF THE TRANSACTION. THE CIT(A), BASED ON THE EVIDENCES FIL ED BY THE ASSESSEE AND ALSO TAKEN INTO ACCOUNT THE REMAND REPORT OF A. O. DELETED THE ADDITION. THE RELEVANT PARAGRAPH OF A.O. IS EXTRACT ED BELOW. 5. THE ABOVE ADDITIONAL EVIDENCE WAS FORWAR DED TO THE ASSESSING OFFICER FOR HIS COMMENTS AND ALSO FOR A REPORT AFTE R NECESSARY INQUIRY. THE ASSESSING OFFICER FILED ITS REPORT VIDE LETTER DT.4.11.2013 AND ITA NO.161/VIZAG/2014 SRI KANIGOLLA SUDHEER, ELURU 5 03.01.2014. DURING THE REMAND PROCEEDINGS, THE ASSE SSING OFFICER HAD EXAMINED THE MANAGING DIRECTOR OF M/S. AMBICA CHENN A KESAVA PROJECTS LIMITED WHO HAD ISSUED THE SAID CONFIRMATION LETTER . IN THE REPORT IT WAS STATED THAT SHRI PT.N.V.A.R. SUDARSHAN, MANAGING DI RECTOR APPEARED AND PRODUCED THE BOOKS OF ACCOUNT OF THE COMPANY. THE S AID MANAGING DIRECTOR ALSO CONFIRMED TO THE AC THAT THE AMOUNTS WERE DEPOSITED IN THE ACCOUNTS OF THE ASSESSEE OUT OF THE CASH BALANC E OF THE COMPANY. THE ASSESSING OFFICER HAD ALSO VERIFIED THE BOOKS O F ACCOUNTS OF THE COMPANY AND FOUND THAT THERE WERE WITHDRAWALS FROM THE CASH BOOK OF THE COMPANY ON THE RESPECTIVE DATES FOR DEPOSITING THE CASH IN THE SAVINGS BANK ACCOUNT OF THE ASSESSEE. HENCE, THE AS SESSING OFFICER CONCLUDED IN HIS REPORT THAT AS THE IDENTITY OF THE CREDITOR, THE CREDIT- WORTHINESS OF THE CREDITOR AND THE GENUINENESS OF T HE TRANSACTION ARE PROVED THE ADDITIONAL EVIDENCE FILED MAY BE ACCEPTE D AS GENUINE. IN VIEW OF THE ABOVE FINDINGS OF THE AC BASED IN THE I NQUIRY, THE SOURCE FOR THE IMPUGNED CASH DEPOSITS TO THE TUNE OF RS.34,00, 000/- CAN BE CONSIDERED TO BE EXPLAINED. IN THESE FACTUAL SCENAR IO, THE ASSESSING OFFICER IS DIRECTED TO DELETE THE IMPUGNED ADDITION . 5. WE FIND THAT CIT(A) HAS CONSIDERED RELEVANT EVIDE NCES SUCH AS CONFIRMATION LETTERS AND BOOKS OF ACCOUNTS OF M/S A MBICA CHANNAKESAVA PROJECTS LIMITED AND FIND THAT THE CASH DEPOSITS IN TO ASSESSEE SAVINGS BANK ACCOUNT AT ICICI BANK, ELURU WERE WITHDRAWN FR OM THE COMPANY. THE FACTS REMAIN SAME EVEN BEFORE US. THE REVENUE H AS FAILED TO BROUGHT ON RECORD ANY EVIDENCES TO PROVE THAT THE F INDINGS OF THE FACT RECORDED BY CIT(A) IS INCORRECT. THEREFORE, WE ARE OF THE OPINION THAT THE CIT(A) HAS RIGHTLY DELETED THE ADDITION. WE DO N OT SEE ANY REASON TO INTERFERE WITH CIT(A) ORDER, HENCE, WE INCLINED TO UPHELD THE CIT(A) ORDER AND DISMISS THE APPEAL FILED BY THE REVENUE. 6. THE CROSS OBJECTION FILED BY THE ASSESSEE IS SUP PORTING THE ORDER OF CIT(A). WE, THEREFORE, FOR THE REASONS RECORDED IN THE PRECEDING ITA NO.161/VIZAG/2014 SRI KANIGOLLA SUDHEER, ELURU 6 PARAGRAPHS, OF THE OPINION THAT THE CROSS OBJECTION FILED BY THE ASSESSEE IS INFRUCTOUS AND HENCE, THE SAME IS DISMISSED. 7. IN THE RESULT, THE APPEAL FILED BY THE REVENUE A ND CROSS OBJECTION FILED BY THE ASSESSEE ARE DISMISSED. THE ABOVE ORDER WAS PRONOUNCED IN THE OPEN COURT O N 31 ST MAR16. SD/- SD/- ( . ) ( . ) (V. DURGA RAO) (G. MANJUNATHA) /JUDICIAL MEMBER /ACCOUNTANT MEMBER # /VISAKHAPATNAM: ' /DATED : 31.03.2016 VG/SPS )# *# /COPY OF THE ORDER FORWARDED TO:- 1. / THE APPELLANT THE ITO WARD-1, KKS TOWERS, RR P ET, ELURU 2. / THE RESPONDENT SHRI KANIGOLLA SUDHEER, S/O JAG AT KUMAR, D.NO.3B-17- 22/1-2, SENAGAPPAPPU BAZAR, ELURU-534001. 3. + / THE CIT, VISAKHAPATNAM 4. + ( ) / THE CIT (A), VISAKHAPATNAM 5. # . , . , # / DR, ITAT, VISAKHAPATNAM 6 . / GUARD FILE / BY ORDER // TRUE COPY // 12 . (SR.PRIVATE SECRETARY) . , # / ITAT, VISAKHAPATNAM