ITO, Dehradun V. Sh. Parmatma Rai, New Delhi

ITA 10/DEL/2010

• Counselvise Citation: 1020114 RSA 2010
• Duration Of Justice: 1 year(s) 9 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-10-2011
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: F
• Next Hearing Date: 19-10-2011
• Assessment Year: 2005-2006
• Appeal Filed On: 01-01-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: A K MONGA
• Assessee Lawyers: B P ANTHWAL
• Keywords: Unexplained cash credit; Income from undisclosed sources; Rectification of order; Search and seizure
• Section: 142(1); 133(6); 54; 144; 154

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI F BENC H BEFORE SHRI R.P. TOLANI, JM & SHRI A.N. PAHUJA, AM ITA NO.10/DEL/2010 WITH CO NO.363/DEL/2010 ASSESSMENT YEAR:2005-06 INCOME TAX OFFICER, WARD-1(3), ANNEXE BUILDING,13-A, SUBHASH ROAD, DEHRADUN V/S . SHRI PARMATMA RAI, B-46, MTNL STAFF QUARTERS, GH- 17, PASCHIM VIHAR, NEW DELHI [PAN:ABRPR 8364 A] (APPELLANT) (RESPONDENT) ASSESSEE BY SHRI B.P. ANTHWAL, AR REVENUE BY SHRI A.K. MONGA, DR DATE OF HEARING 19-10-2011 DATE OF PRONOUNCEMENT 19-10-2011 O R D E R A.N.PAHUJA:- THIS APPEAL FILED ON 01.01.2010 BY THE REVENUE AND CORRESPONDING CROSS-OBJECTION [CO] FILED ON 02.11.2 010 BY THE ASSESSEE AGAINST AN ORDER DATED 01.10.2009 OF THE LEARNED CIT(A)-I, DEHRADUN, RAISE THE FOLLOWING GROUNDS:- I.T.A. NO.10/D/2010[REVENUE] 1. THE LEARNED CIT(A) HAS ERRED IN LAW AND ON FACTS IN DELETING THE ADDITION OF ` ` 9,07,587/- WITH THE DIRECTION TO THE ASSESSING OFFICER TO RE-EXAMINE THE FACTS U/S 1 54 BY OBTAINING BANK ACCOUNTS STATEMENTS. THIS DIRECTION IS BEYOND THE JURISDICTION OF THE LEARNED CIT(A) AND A LSO IN CONTRAVENTION OF THE LETTER AND SPIRIT OF SECTION 154. 2. THE LEARNED CIT(A) HAS ERRED IN LAW AND ON FACTS IN DELETING THE ADDITION OF ` `4,92,512/- MADE ON ACCOUNT OF UNEXPLAINED CASH CREDITS WITHOUT APPRECIATING THE F ACTS THAT THE AMOUNTS CONTINUED TO BE HELD IN THE ACCOUN T TILL END WHICH ITSELF CONTRADICTED THE PURPORTED PURPOSE OF THE ALLEGED LOAN GIVEN TO ESTABLISH AND EXPAND THE DAIR Y BUSINESS. ITA N O. 10/DEL./2010 & CO NO.363/DEL./2010 2 3. THE ORDER OF THE LEARNED CIT(A) BE SET ASIDE AND THAT OF THE ASSESSING OFFICER BE RESTORED. C.O. NO.363/D/2010[ASSESSEE] 1. THE ASSESSMENT ORDER IS VOID AB-INITIO FOR THE R EASON THAT YOUR GOODSELF SHALL APPRECIATE THAT IN WHOLE OF THE SEQUENCE AS MENTIONED ABOVE THERE IS NO RETURN OF INCOME PURSUANCE OF WHICH A NOTICE U/S 143(2) MENTIONED IN HAS BEEN ISSUED. THE INCOME TAX ACT CLEARLY STIPULATE THAT WHEN RETURN IS FILED BY AN A SSESSEE THE INCOME TAX OFFICER IF SATISFIED WOULD PASS AN O RDER U/S 143(1) AND IF HE REQUIRED CERTAIN ADDITIONAL INFORM ATION OR EXPLANATION HE WOULD ISSUE A NOTICE U/S 143(2) TO PROCEED TO MAKE AN ASSESSMENT U/S 143(3). IT IS MANDATORY THAT A NOTICE U/S 143(2) CAN ONLY BE ISSU ED IF THERE IS E-RETURN ON THE RECORD. THIS IS A VERY PE CULIAR CASE WHERE THERE IS NO RETURN OF INCOME ON THE RECO RD AND/ THE ASSESSING OFFICER HAS ISSUED A NOTICE U/S 143(2) TO PROCEED FOR MAKING AN ASSESSMENT U/S 143(3). TH E VERY FACT THAT THE NOTICE U/S 143(2) WHICH HAS BEEN ISSUED BY THE INCOME TAX OFFICER IS ILLEGAL HE CANN OT ASSUME JURISDICTION TO ASSESS UNDER AN ILLEGAL NOTI CE. THE ASSESSMENT ORDER MERITS TO BE DECLARED NULL AND VOID. 2. THE APPEAL BEING FILED ON FRIVOLOUS GROUNDS BE DISM ISSED IN THE INTEREST OF JUSTICE. 2. ADVERTING FIRST TO GROUND NOS.1 & 2 IN THE APPEA L OF THE REVENUE, FACTS, IN BRIEF, AS PER RELEVANT ORDERS ARE THAT IN THIS CASE A SEARCH WAS CONDUCTED ON 30 TH JUNE, 2005 AT THE RESIDENCE OF ASSESSEE AT DEHRADUN BY THE CBI DURING HIS POSTING AS DGM,BSNL THERE. SINCE THE ASSESSEE DID NOT FILE ANY RETURN FOR THE YEAR UNDER CONSIDERATION, THE ASSESSING OFFICER, (A .O. IN SHORT) ISSUED A NOTICE U/S 142(1) OF THE INCOME-TAX ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT) ON 26 TH AUGUST, 2005. IN RESPONSE, THE ASSESSEE DID NOT FI LE ANY RETURN. IN RESPONSE TO ANOTHER NOTICE DATED 14 TH AUGUST, 2007 ISSUED U/S 142(1) OF THE FACT FOR FIL ING THE RETURN, THE ASSESSEE REPLIED THAT HE HAD FILED A RE TURN FOR THE YEAR UNDER CONSIDERATION WITH INCOME TAX OFFICER, VARANASI. HO WEVER, THE ASSESSEE DID NOT FURNISH ANY EVIDENCE IN SUPPORT THEREOF. ACCORDINGL Y, THE ASSESSEE WAS REQUESTED TO FURNISH A COPY OF ACKNOWLEDGEMENT OF FILING OF RETURN ALONG WITH ITA N O. 10/DEL./2010 & CO NO.363/DEL./2010 3 DETAILS OF SALARY AND A COPY OF BANK STATEMENT IN HIS NAME AND IN THE NAME OF HIS FAMILY MEMBERS FOR THE YEAR UNDER CONSIDERATION . ON INQUIRY WITH INCOME TAX OFFICER, WARD-I(1), VARANASI , IT WAS INFORMED BY H IM THAT RETURN RECEIPT REGISTER FOR THE FY 2005-06 & 2006-07 REVEALED THAT NO RETUR N WAS FILED BY THE ASSESSEE. SINCE THE ASSESSEE DID NOT FURNISH COPY OF ACKNOWLE DGMENT OF FILING OF RETURN NOR OTHER DETAILS CALLED FOR FROM HIM, ACCORDINGLY, THE AO APPROACHED CGM, UTTARANCHAL TELECOM CIRCLE, DEHRADUN U/S 133(6) OF THE ACT.ON THE BASIS OF INFORMATION RECEIVED , IT TRANSPIRED THAT THE ASSES SEE OWNED VARIOUS BANK ACCOUNTS AND PURCHASED/ACQUIRED KVPS, TAX SAVING BO NDS, FDR/STDRS, JEWELLERY AND HOUSEHOLD ARTICLES ETC. IN HIS NAME A ND IN THE NAME OF HIS FAMILY MEMBERS. IN THE LIGHT OF THIS INFORMATION AND THE ASSESSEE HAVING FAILED TO FURNISH THE INFORMATION DESIRED BY THE AO, THE AO P ROPOSED TO COMPLETE THE ASSESSMENT U/S 144 OF THE ACT AND ACCORDINGLY, A SH OW CAUSE NOTICE DATED 14.12.2007 WAS ISSUED TO THE ASSESSEE. IN RESPONSE , THE ASSESSEE SUBMITTED A COPY OF ACKNOWLEDGMENT OF FILING OF THE RETURN ALON G WITH A COPY OF INTIMATION U/S 143(1) OF THE ACT, REVEALING INCOME OF ` `4,91,809/- DECLARED IN THE RETURN FILED FOR THE YEAR UNDER CONSIDERATION BEFORE THE INCOME TAX OFFICER, RANGE 2(2), VARANASI. THE AO ALSO RECORDED THE STATEMENT OF T HE ASSESSEE ON 24.12.2007 WHEN DETAILS OF HIS INCOME AND ASSETS AND SOURCES O F ACQUISITION WERE REVEALED. THESE DETAILS ARE MENTIONED IN PARA 4 OF THE ASSESS MENT ORDER. INTER ALIA, THE ASSESSEE DID NOT RAISE ANY OBJECTION TO COMPLETION OF HIS ASSESSMENT BY THE AO. DURING THE COURSE OF ASSESSMENT PROCEEDINGS , ON PE RUSAL OF COPIES OF BANK PASS BOOK OF THE ASSESSEE AND HIS FAMILY MEMBERS, T HE AO NOTICED FOLLOWING BANK BALANCES AS ON 30.6.2005:- SL. NO. NAME OF THE BANK A/C NO. BALANCE AS ON 30.6.2005 [IN ` ] 1 SBI, GORAKHPUR 92971 1040.28 2 INDUSLAND BANK, LUCKNOW 451236 33815.43 3 UTI BANK, 21377 11530.00 ITA N O. 10/DEL./2010 & CO NO.363/DEL./2010 4 LUCKNOW 4 BANK OF BORADA, VARANASI 9094 109274.86 5 SBI MAU 4206 26575.70 6 UBI NARAI BANDH ,MAU 7182 53664.00 7 SBI VARANASI 1504 1569.69 8 SBI GORAKHPUR 91514 13857.17 9 UBI,MAU 44136 8396.00 10 SBI,DEHRADUN 53107 4450.00 11 UBI,MOHD. LAD GHAT 1450 6459.00 12 UBI MOHD LAL GHAT 7144.00 13 SBI PPF INDORE 3179 630413.73 14 SBI GHAZIPUR 45235 BALANCE TRANSFERRED TO SBI GORAKHPUR 15 CBI,VARANASI 25504 859913.82 2.1 APART FROM THE ABOVE, THE ASSESSEE FURNISHED A COPY OF BANK STATEMENT IN THE JOINT NAME OF SMT. PRATIMA RAI AND MS. PRIYANKA RAI WITH SBI,MAU, REVEALING BALANCE OF ` .1,25,548/- AS ON 21.7.2007.SINCE THE DIRECTOR VIGI LANCE IN THE DEPARTMENT OF TELE COMMUNICATION INFORMED THE AO TH AT THE ASSESSEE HAD BANK BALANCE OF ` `26,75,689/- WHILE COPIES OF BANK PASS BOOKS REVEAL ED THE DEPOSITS OF ONLY ` 17,68,100/- AND THE ASSESSEE DID NOT RECONCILE THE DIFFERENCE, THE AO ADDED THE AMOUNT OF ` 9,07,587/- [26,75,689 - 17,68,100] BY WAY OF UNEXPL AINED INVESTMENTS. 2.2 THE AO FURTHER NOTICED ON PERUSAL OF BANK ACCO UNT OF THE ASSESSEE AND HIS DAUGHTER, WITH CBI VARANASI, CREDIT ENTRIES O F ` 1,99,950/-, ` 50,051 AND ` 1,01,720/- IN THE MONTH OF JULY, 2004 . TO A QUERY BY THE AO, THE ASSESSEE EXPLAINED THAT THESE AMOUNTS WERE GIVEN AS LOAN TO HIS WIFE AND DAUGHTER BY MR. D.N. SHUKLA FOR COMMENCING NEW PROJECT OF DAIRY BUS INESS. HOWEVER, THE ASSESSEE DID NOT FURNISH ANY EVIDENCE IN SUPPORT OF HIS EXPLANATION. BESIDES, THE ASSESSEE EXPLAINED THE FOLLOWING CREDIT ENTRIES IN HIS BANK ACCOUNT:- CREDIT ENTRY OF ` ` 50,000/- DT. 26.10.2004 ITA N O. 10/DEL./2010 & CO NO.363/DEL./2010 5 CREDIT ENTRY OF ` ` 10,000/- DT. 26.10.2004 CREDIT ENTRY OF ` ` 53,965/- DT. 03.02.2005 CREDIT ENTRY OF ` ` 5,000/- DATED 10.02.2005 CREDIT ENTRY OF ` ` 21,826/- DT. 10.03.2005 AS LOAN FROM SHRI SHRIDHAR UPADHYAYA FROM TIME TO T IME. SINCE NO DOCUMENTARY EVIDENCE OR CONFIRMATION IN SUPPORT OF HIS STATEMEN T THAT LOANS WERE RECEIVED FROM SHRI DN SHUKLA OR SHRI SHRIDHAR UPADHYAYA WAS SUBMITTED BEFORE THE AO, ACCORDINGLY , AN AMOUNT OF ` `4,92,512/- WAS ADDED BY WAY OF UNEXPLAINED CASH CREDITS. 3. ON APPEAL, THE LEARNED CIT(A) AFTER HAVING A REP LY OF THE AO ON THE WRITTEN SUBMISSIONS OF THE ASSESSEE, DELETED THE ADDITION O F ` 9,07,587/-, HOLDING AS UNDER:- 9. IN THE COURSE OF APPELLANT PROCEEDINGS, THE LEA RNED AR HAS FURNISHED COPIES OF LETTERS WRITTEN BY THE APPELLAN T TO DOT-SANCHAR BHAVAN, NEW DELHI (VIG. WING) ASKING FOR INFORMATIO N UNDER THE RTI ACT, 2005 AND THE APPELLANT AUTHORITY UNDER THE RTI ACT, 2005 HAS ASKED THE CPIO TO FURNISH THE INFORMATION SOUGHT AF TER OBTAINING THE INFORMATION FROM THE CBI. BY LETTER DATED 23.04.20 08 VIG. WING SUPPLIED THE PAPERS AND DOCUMENTS TO THE APPELLANT BUT DID NOT WORK OUT THE BALANCES INFORMED EARLIER AND NEITHER SUPPLIED ANY CONFIRMATION TO THE APPELLANT OR THE INCOME TAX DEP ARTMENT DIRECTLY. THE LEARNED AR SHRI ANTHAWAL, THEREAFTER FURNISHED A LETTER DATED 23.10.2008 WHICH IS REPRODUCED AS UNDE R: 1. THAT POLITICALLY MOTIVATED CBI RAID TO HARASS A ND VICTIMIZED THE ASSESSEE WAS CONDUCTED ON 30.06.2005. THE INCOME T AX OFFICER, WARD 1(3) DEHRADUN STARTED ILLEGAL PROCEEDINGS BY I SSUING A NOTICE U/S 142(1) WHICH WAS WITHOUT JUSTIFICATION. THE PR OCEEDINGS WERE STARTED AT THE FAG END WHEN THE CASE WAS GOING TO B ARRED BY TIME. THE ASSESSEE, THEREFORE, WAS NOT GIVEN REASONABLE A ND SUFFICIENT OPPORTUNITY TO PRODUCE RELEVANT DOCUMENTS AND EVIDE NCES DURING THE COURSE OF ASSESSMENT, WHICH WAS HURRIEDLY CONCL UDED. 2. THE ASSESSEE WAS PREVENTED BY REASONABLE AND SUF FICIENT CAUSE IN NOT PRODUCING SUCH DOCUMENTS AND EVIDENCES WHICH WOULD HAVE PROVED HIS CASE. ITA N O. 10/DEL./2010 & CO NO.363/DEL./2010 6 3. THE ASSESSEE HAD TRIED HIS LEVEL BEST TO PROCURE TH E DOCUMENTS FROM THE VARIOUS AGENCIES LIKE CBI, BANKS, DEPT. OF TELECOMMUNICATIONS (THE EMPLOYER). THE ASSESSEE EV EN INVOKED HIS RIGHT UNDER THE RTI ACT, 2005 AND HAS U LTIMATELY BEEN SUCCESSFUL IN GETTING THE INFORMATION ON 01.05 .2008 WHICH IS SUBSTANTIAL EVIDENCE IN THE ASSESSEE CASE TO PROVE THAT THE ADDITIONS MADE BY THE ASSESSING OFFICER AR E ONLY BASED ON THE SURMISES AND CONJECTURE AND WHICH ARE NOT BASED ON THE FACTS. 4. SIMILARLY THE APPELLANTS WAS PREVENTED BY THE REASO NABLE AND SUFFICIENT CAUSE IN NOT PRODUCING CERTAIN EVIDENCES OF PERSONS WHO EITHER OWN THE ASSETS OR LENT THE ASSETS, AND / WHICH ARE WRONGLY ASSESSED IN THE HANDS OF APPELLANTS. 5. IN THE LIGHT OF ABOVE AND INTEREST OF JUSTICE IT /I S HUMBLY REQUESTED THAT THE APPELLANT MAY BE ALLOWED TO PROD UCED CERTAIN ORAL AND DOCUMENTARY EVIDENCES BEFORE YOUR GOOD SELF. 10. AFTER RECEIPT OF THE AFORESAID LETTER OF THE L EARNED AR, A LETTER WAS WRITTEN BY THE UNDERSIGNED TO THE ASSESSING OFF ICER ON VARIOUS ADDITIONS MADE IN THE ASSESSMENT ORDER AND TO RECON CILE THE BANK BALANCE ETC. AS INFORMED BY THE DIRECTOR (VIG.) AND AS EXPLAINED BY THE APPELLANT. THE PART RELEVANT TO THE ADDITION O F RS.`9,07,587/- CONFRONTED TO THE ASSESSING OFFICER IN THE LETTER O F THE UNDERSIGNED DATED 16.02.2009 IS REPRODUCED AS UNDER: THE FIRST ADDITION OF RS.`9,07,587/- FIGURING ON PAG E 5 OF THE ASSESSMENT ORDER DATED 31.12.2007 HAS BEEN MADE ON THE BASIS OF VARIOUS BANK BALANCES AS ON 30.06.2005 WHICH FALLS OUTSIDE THE ASSESSMENT YEAR 2005-06 FOR WHICH ASSESSMENT ORDER DATED 31.12.2007 HAS BEEN PASSED. THE ADDITION OF RS.9,07,587/- WOULD HAVE BEEN RELEVANT FOR EXAMINATION OR VERIFICATION IF THE ASSESSMENT YEAR UNDER CONSIDERATION WAS ASSESSMENT YEAR 2006-07 AND NOT ASSESSMENT YEAR 2005-06. IF THESE FACTS ARE TRUE BY NOW, A RECTIFICATION ORDER U/S 154 SHOULD HAVE BEEN PASSED ON COMING TO KNOW THAT BANK BALANCES FOR A SUBSEQUENT YEAR HAVE BEEN ASSESSED AS INCOME IN ASSESSMENT YEAR 2005-06. PLEASE CONFIRM WHETHER SUCH RECTIFICATION HAS BEEN MADE. IF NOT YOUR DETAILED COMMENTS ON THE ISSUE SHOULD BE SENT. ITA N O. 10/DEL./2010 & CO NO.363/DEL./2010 7 11. IN RESPONSE, ON THE ADDITION OF RS.`9,07,587/- THE ASSESSING OFFICER HAS FURNISHED REPLIES DATED 02.03.09 AND DA TED 30.03.09. THE REPLY OF THE ASSESSING OFFICER IN LETTER DATED 30.03.09 IS REPRODUCED AS UNDER:- AS DESIRED, A LETTER WAS FORWARDED TO THE DIRECTOR (VIG) TELECOM DEPARTMENT AND ALSO INSPECTOR WAS DEPUTED TO COLLEC T THE INFORMATION FROM THAT OFFICE. IT HAS BEEN REPORTED BY THE ITI THAT THE INFORMATION IS BEING COMPLIED AND SHALL BE FORW ARDED BY FAX LATEST BY 30.03.09 BUT NO FAX HAS BEEN RECEIVED TIL L DATE. AS STATED IN MY REPORT DATED 02.03.09, THE ASSESSEE HAS SUBMI TTED A LIST OF BANK BALANCES AGGREGATING TO RS.`27,94,012/- AS ON 30.06.05 AS AGAINST RS.`26,75,688/- FORWARDED BY THE DIRECTOR ( VIG.). THIS FOLLOWS THAT THE FIGURE OF BANK BALANCES SHOWN BY T HE ASSESSEE AS ON 30.06.05 IS HIGHER THAN ADOPTED BY DIRECTOR (VIG .) FURTHER, THE BANK BALANCES AS ON 30.06.05 HAVE NO DIRECT BEARING UPON THE COMPUTING OF THE INCOME OF THE ASSESSEE AS ONLY ACC RETION DURING THE RELEVANT PERIOD EITHER BY WAY OF DEPOSIT OR INT EREST IS TO BE TAKEN INTO ACCOUNT FOR COMPUTING THE INCOME. TO AR RIVE AT THE ABOVE FIGURES, THE BANK BALANCES AS ON 31.03.04 AND 31.03.05 ARE REQUIRED. THIS MEANS TO SAY THAT THE FIGURE OF BAN K BALANCES AS ON 30.06.05 ARE NOT HELPFUL IN WORKING OUT THE INCOME FOR THE PERIOD UNDER CONSIDERATION. UNDER THE FACTS OF VARIATION NARRATED ABOVE IN BANK BALANCES, THE DETAILS OF BANK ACCOUNT, IF S UPPLIED BY THE DIRECTOR (VIG.) WOULD NOT BE MUCH HELPFUL AND IN EV ERY CASE THE FIGURES SUPPLIED BY THE ASSESSEE SHALL BE ACCEPTED AS THE CORRECT BALANCES FOR WORKING OUT THE ACCRETION/INCOME DURIN G THE RELEVANT PERIOD. THEREFORE, IN MY OPINION UNDER THESE FACTS , I SUPPOSE THE ASSESSING OFFICER CAN PASS ORDER U/S 154 BY OBTAINI NG THE DETAILS OF BANK ACCOUNTS AS ON 31.03.04, 31.03.05 FROM THE ASSESSEE. 12. THE ABOVE REPLY OF THE ASSESSING OFFICER WOULD CLEARLY SHOW THAT THE ASSESSING OFFICER HIMSELF UNDERTAKEN TO PA SS A RECTIFICATION ORDER AND HAS ALSO ACCEPTED THAT THE ADDITION OF RS .`9,07,587/- WAS WRONG. MORE IMPORTANTLY, IN HIS LETTER DATED 02.03 .09 THE ASSESSING OFFICER HAS ALSO EXAMINED AND INFORMED THAT THE CHE CK PERIOD IN THE CASE OF THE APPELLANT FALLS OUT OF THE PURVIEW OF T HE ASSESSMENT YEAR 2005-06 AND, THEREFORE, HE HAS ALSO INFORMED T HAT THE ENTRIES RELATING TO CHECK PERIOD SHOULD NOT HAVE BEEN CONSI DERED IN THE ASSESSMENT YEAR. SINCE THE ASSESSING OFFICER HAS H IMSELF SEEN AND MENTIONED THAT THERE ARE GLARING LAPSES IN THE ASSESSMENT, HE HAS RIGHTLY UNDERTAKEN TO PASS A RECTIFICATION ORDE R IN ORDER TO CORRECT THE INCORRECT ADDITIONS MADE. THE GROUND I S, THEREFORE, ALLOWED. IF THE APPELLANT HAPPENS TO BE AGGRIEVED BY THE ITA N O. 10/DEL./2010 & CO NO.363/DEL./2010 8 RECTIFICATION ORDER HE WOULD BE FREE TO FILE AN APP EAL AGAINST THE ORDER U/S 154 OF THE ACT. 3.1 AS REGARDS ADDITION OF RS.4,92,512/-, THE L D. CIT(A) CONCLUDED AS UNDER: 13 GROUND NO.4 AGITATES THE ADDITIONS OF `RS.4,92, 512/- WHICH HAVE NOT BEEN TREATED EXPLAINED BY THE AO. A PERUS AL OF ASSESSMENT ORDER AT PARA 7 SHOWS THAT THE DEPOSITS FOR EXAMINATION BEFORE THE AO WERE IN THE CASE OF THE D AUGHTER AND WIFE OF THE APPELLANT, NAMELY, PRIYANIKA RAI AND SM T. PRATIME RAI. THE APPELLANT EXPLAINED THAT THE AMOUNTS DEPOSITED IN THE BANK ACCOUNT OF THE TWO FAMILY MEMBERS JOINTLY HELD BY T HEM WERE RECEIVED BY CHEQUES AND THE AO HAS ALSO REPRODUCED THE ENTRIES IN THE ASSESSMENT ORDER. SINCE, THERE IS NO DISCUSSIO N ON THE CREDITWORTHINESS OF LENDERS AND, THEREFORE, THE SAM E HAS NEVER BEEN DOUBTED BY THE AO. THE AO HAS ALSO NOT DOUBTE D THE GENUINENESS OF THE TRANSACTION. THE LEARNED AR IN HIS LETTER DATED 09.04.09 HAS STATED THAT THE ASSESSING OFFICER HAS HIMSELF SUBMITTED THAT THE AMOUNT DEPOSITED IN THE BANK ACC OUNT ARE NOT BY WAY OF CASH AND WERE RECEIVED BY CHEQUES FOR RUNNIN G THE DAIRY BUSINESS OF MRS. PRIYANKA RAI AND THE AMOUNTS IN HE R BANK ACCOUNTS COULD NOT HAVE BEEN ADDED TO THE INCOME OF THE APPELLANT. THE EXPLANATION OF LEARNED AR IS REPROD UCED AT PARA-2 OF HIS LETTER AS UNDER:- 2. AS REGARDS TO ADDITIONS OF CREDIT ENTRIES AS UN DER:- [RS .] 23.07.2004 `1,99,950/- 23.07/2004 ` 50,051/- 13.09.2004 `1,01,720/- 26.10.2004 50,000/- 03.12.2004 ` 10,000/- 03.02.2004 `53,965/-(45000+8965/-) 10.02.2005 ` 5,000/- 10.02.2005 ` 21,826/-(`10,000+`11.960) ITA N O. 10/DEL./2010 & CO NO.363/DEL./2010 9 TOTAL `4,92,512/- THE ASSESSING OFFICER IS ADMITTING THAT THESE ARE N OT CASH ENTRIES BUT ARE THROUGH BANKING CHANNEL (THROUGH ACCOUNT PA YEE CHEQUES IN THE NAME OF MS. PRIYANKA RAI WHO WAS MAJOR DURIN G THE PERIOD UNDER CONSIDERATION) FOR THE DAIRY BUSINESS ON THE ANCESTRAL LAND OF HER FAMILY, AND THE DAIRY BUSINESS IS THE FAMILY BUSINESS OF THE MS. PRIYANKA RAI, APPELLANT HAS DISCHARGED HIS ONUS CAST ON HIM UNDER THE LAW BY FILING THE CONFIRMATION AND RELEVA NT DOCUMENTS ALONG WITH PROOF OF SALE OF OLD JEWELLERY, THUS, PR OVING THE IDENTITY OF THE PERSONS AND DULY ESTABLISHING CAPACITY, STAT US AND AVAILABILITY OF THE FUNDS WITH THE CREDITORS. THE ASSESSING OFFICER CITED THE CASE IN HIS REMAND REPORT IN REFERENCE OF THE AFORESAID CASE. IN THIS REGARDS, I WOULD LIKE TO INFORM YOU THAT THE CIRCUMSTANCE OF THE CITED CASE ARE DIFFERENT FROM THE PRESENT CASE. WHERE AS THE NECESSARY AND REQUIRED EXPLANATION ALONG WITH CONFIRMATIONS HAVE BEEN PLAC ED ON RECORDS OF THE ASSESSING OFFICER BUT THE SAME SEEMS TO BE O VER SIGHTED BY THE ASSESSING OFFICER. THE TRANSACTIONS BEING BEYO ND ANY DOUBT MERITS TO BE DELETED. 14. THE ABOVE SUBMISSIONS OF THE LEARNED AR WHEN CO NFRONTED TO THE ASSESSING OFFICER, THE ASSESSING OFFICER HAS ME RELY EXPRESSED CERTAIN RESERVATIONS LIKE WHY ANY PERSON SHOULD GIV E A LOAN TO A GIRL WHO IS STILL DOING HER STUDIES AND STATED THAT THIS IS BEYOND IMAGINATION. THE LEARNED ASSESSING OFFICER IN THE SAME VEIN HAS HIMSELF CONFIRMED THAT THE LOAN TRANSACTIONS ARE MA DE BY WAY OF CHEQUES/DRAFTS AND THE IDENTITIES OF THE LENDERS HA VE BEEN TAKEN BY HIM AS ESTABLISHED. AFTER SATISFYING HIMSELF ABOUT THESE NECESSARY INGREDIENTS OF A LOAN TRANSACTION, HE HAS STILL MEN TIONED THAT THE LOANS SHOULD NOT BE TREATED AS GENUINE. IT IS STRA NGE THAT THE ASSESSING OFFICER ON THE ONE HAND IS CERTIFYING THE NECESSARY INGREDIENTS OF THE LOANS TO HAVE BEEN SATISFIED AND YET RECOMMENDING TO THE CIT(A) THAT THE LOANS SHOULD NO T BE CONSIDERED AS GENUINE. 15. THE FOREGOING WOULD SHOW THAT THE IDENTITY, CRE DITWORTHINESS AND GENUINENESS OF THE TRANSACTIONS HAVE BEEN FULLY ACCEPTED BY THE ASSESSING OFFICER AND HIS VIEWS THAT THE TRANSA CTIONS ARE PRE- PLANNED TO CHANNELISE APPELLANTS UNACCOUNTED INCOM E ARE NOT BORNE OUT BY ANY TANGIBLE FINDING OR ANY EVIDENCE. THE APPELLANT HAS ALSO REPLIED TO ASSESSING OFFICERS QUERY REGAR DING WHY LOANS HAVE NOT BEEN REPAID TO THE LENDERS. THE APPELLANT HAS GIVEN IN WRITING THAT THE ACCOUNTS OF THE FAMILY MEMBERS ARE STILL ITA N O. 10/DEL./2010 & CO NO.363/DEL./2010 10 RESTRAINED/FROZEN BY THE CBI AND CANNOT BE OPERATED BY THE FAMILY MEMBERS. EVEN THOUGH THIS QUERY IS NOT EVEN RELEVA NT IN RESPECT OF A LOAN TRANSACTION AS TO ITS GENUINENESS BUT THE AP PELLANT HAS GIVEN THE DESIRED INFORMATION. UNDER THE CIRCUMSTANCES T HE ASSESSING OFFICER HAD NO REASON TO STATE THAT THE LOANS AMOUN TING TO RS.`4,92,512/- SHOULD NOT BE TREATED AS GENUINE AND HE IS ACCORDINGLY DIRECTED TO DELETE THE ADDITION. 4. THE REVENUE IS NOW IN APPEAL BEFORE US AGAINST T HE AFORESAID FINDINGS OF LEARNED CIT(A). THE LD. DR SUPPORTED THE ORDER OF A O WHILE THE LEARNED AR ON BEHALF OF THE ASSESSEE RELIED UPON THE FINDINGS OF THE LD. CIT(A). TO A QUERY BY THE BENCH, THE LD. DR DID NOT REPLY AS TO HOW GROUN D NO.1 IN THEIR APPEAL ARISES FROM THE FINDINGS OF THE LD. CIT(A) IN THE IMPUGNED ORDER. 5. WE HAVE HEARD BOTH THE PARTIES AND GONE THROUGH THE FACTS OF THE CASE. WE FIND THAT THE REVENUE HAVE RAISED GROUND NO.1 RE LATING TO DELETION OF ADDITION OF ` `9,07,587/- BY THE LD. CIT(A) WITH THE DIRECTIONS TO THE AO TO RE-EXAMINE THE FACTS U/S 154 BY OBTAINING BANK ACCOUNT STATEMENTS. ON PERUSAL OF IMPUGNED ORDER, WE FIND THAT NO SUCH DIRECTIONS APPEAR TO HA VE BEEN ISSUED BY THE LEARNED CIT(A); RATHER , THE AO IN HIS REPLY DATED 30.3.300 9, EXTRACTED IN PARA 11 OF THE IMPUGNED ORDER, VOLUNTEERED TO DO SO. EVEN BEFORE U S, TO A QUERY BY THE BENCH, THE LEARNED DR COULD NOT POINT OUT AS TO WHERE THES E DIRECTIONS WERE MENTIONED IN THE IMPUGNED ORDER. EVEN OTHERWISE, THE LEARNED CIT(A) NOTICED THAT THE ADDITION OF ` `9,07,587/- WAS MADE ON THE BASIS OF VARIOUS BANK B ALANCES AS ON 30 TH JUNE, 2005, FALLING BEYOND THE FINANCIAL YEAR UND ER CONSIDERATION AND THE AO HIMSELF IN HIS REMAND REPORT ACCEPTED THAT THE A DDITION OF ` ` 9,07,587/- WAS WRONG. AS POINTED OUT BY THE LD. CIT(A), SINCE TH E ADDITION WAS ADMITTEDLY MADE ON THE BASIS OF FACTS RELEVANT FOR THE SUBSEQ UENT YEAR AND THE AO DID NOT BRING ANY MATERIAL ON RECORD RELEVANT FOR THE YEAR UNDER CONSIDERATION BEFORE MAKING THE ADDITION ON THE BASIS OF ENTRIES IN THE BANK ACCOUNTS, WE ARE OF THE OPINION THAT THE LD. CIT(A) RIGHTLY DELETED THE ADD ITION AFTER GIVING SUFFICIENT OPPORTUNITY TO THE AO. SINCE THE LEARNED DR DID NOT PLACE ANY MATERIAL, CONTROVERTING THE AFORESAID FINDINGS OF LEARNED CIT (A), BEFORE US, WE ARE NOT INCLINED TO INTERFERE. THEREFORE, GROUND NO.1 IN T HE APPEAL IS DISMISSED. ITA N O. 10/DEL./2010 & CO NO.363/DEL./2010 11 6. AS REGARDS GROUND NO.2, WE FIND THAT THE LEARNED CIT(A) AFTER HAVING A REMAND REPORT FROM THE AO ON THE WRITTEN SUBMISSIO NS AND EVIDENCE SUBMITTED BY THE ASSESSEE BEFORE HIM ,CONCLUDED THAT IDENTITY , CREDITWORTHINESS AND GENUINENESS OF THE TRANSACTIONS HAVE BEEN FULLY ACC EPTED BY THE AO AND THAT THERE WAS NO MATERIAL TO HOLD THAT THE TRANSACTIONS WERE PRE-PLANNED TO CHANNELISE THE ASSESSEES UNACCOUNTED INCOME. IN THESE CIRCUMSTANCES, ESPECIALLY WHEN THE REVENUE HAVE NOT PLACED ANY MAT ERIAL BEFORE US SO AS TO ENABLE US TO TAKE A DIFFERENT VIEW IN THE MATTER, W E ARE NOT INCLINED TO INTERFERE WITH THE FINDINGS OF LEARNED CIT(A).CONSEQUENTLY, G ROUND NO.2 IN THE APPEAL OF THE REVENUE IS ALSO DISMISSED. 7. AS REGARDS GROUNDS RAISED IN THE BELATED CO, T HE LEARNED AR ON BEHALF OF THE ASSESSEE DID NOT PRESS THE SAID GROUNDS BEF ORE US NOR THE SAID GROUNDS EMERGE FROM THE FINDINGS OF THE LD. CIT(A), THE ISS UE HAVING BEEN NOT RAISED BEFORE HIM. IN THESE CIRCUMSTANCES, GROUNDS RAISED IN THE CO ARE DISMISSED. 8. GROUND NO.3 OF THE APPEAL OF THE REVENUE, BEING MERE PRAYER, DOES NOT REQUIRE ANY SEPARATE ADJUDICATION AND, IS, THEREFOR E, DISMISSED. 9. NO OTHER PLEA OR SUBMISSION WAS MADE BEFORE U S. 10. IN RESULT, BOTH THE APPEAL OF THE REVENUE AND T HE CO OF THE ASSESSEE ARE DISMISSED. SD/- SD/- (R.P. TOLANI) (A.N. PAHUJA) (JUDICIAL MEMBER) (ACCOUNTANT MEMBER) COPY OF THE ORDER FORWARDED TO :- 1. INCOME TAX OFFICER, WARD-1(3), DEHRADUN. 2. SHRI PARMATMA RAI, B-46, MTNL STAFF QUARTERS, GH -17, PASCHIM VIHAR, NEW DELHI. 3. CIT(A)-1, DEHRADUN. ORDER PRONOUNCED IN OPEN COURT ITA N O. 10/DEL./2010 & CO NO.363/DEL./2010 12 4. CIT CONCERNED. 5. DR, ITAT,F BENCH, NEW DELHI 6. GUARD FILE. BY ORDER, DEPUTY / ASSTT.REGISTRAR ITAT, DELHI