DCIT, Central Circal-6, New Delhi V. Dipankar Pal, Kolkata

ITA 1014/DEL/2020

• Counselvise Citation: [2024] 101 COUNSELVISE.COM (IT) 6495 (ITAT-DELHI)
• Duration Of Justice: 4 year(s) 3 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-06-2024
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 19-05-2024
• Assessment Year: 2015-2016
• Appeal Filed On: 08-03-2020
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Unexplained cash credit; Salary income; Onus to prove
• Section: 68; 143(1)

Judgement Text

THE INCOME TAX APPELLATE TRIBUNAL, DELHI BENCH: ‘B’ NEW DELHI BEFORE SHRI G.S. PANNU, VICE-PRESIDENT AND SHRI ANUBHAV SHARMA, JUDICIAL MEMBER ITA No. 1014/Del/2020 Assessment Year: 2015-16 DCIT, Central Circle-06, New Delhi-1100 92 Vs. Shri Dipankar Pal, CJ-231, Sector 11, Salt Lake City, Kolkata PAN: AGDPP2747G (Appellant) (Respondent) ORDER PER ANUBHAV SHARMA: JUDICIAL MEMBER: Revenue has filed the appeal against the order dated 13.11.2019 under Sections 143(1) of the Income-Tax Act, 1961 Assessee by Ms. Rano Jain, Adv. And Ms. Mansi Jain, CA Department by Shri Vivek Kumar Upadhyay, Sr. DR Date of hearing 20.05.2024 Date of pronouncement 10.06.2024 2 ITA No.1014/Del/2020 (hereinafter referred “the Act” ) passed by the learned Commissioner of Income-Tax (Appeals)-15, Kolkata in an appeal before him arising out of assessment order dated 28.12.2017 passed by the DCIT, Central Circle-6, Kolkata (hereinafter referred as “the A.O. or in short “AO”) under Section 143(1) of the Act for assessment year 2014-15. 2. Heard and perused the record. 3. The assessee’s return was taken up for scrutiny and Assessing Officer had examined the additions in capital account and expenses claimed in the P & L account. Assessee is an individual and during the relevant previous year under consideration, the assessee claimed to have earned income from salary, house property, share dealings and income from other sources. The Assessing Officer had observed that in the capital account of the assessee under the head “Dipankar and Ajanta Pal” addition of Rs.1,80,57342.89 is made and the opening capital account balance was enhanced by Rs.42,35,691.87. As assessee was show caused to explain the same it was submitted that these were due to undisclosed foreign accounts which were now made part of the capital account and the difference in opening capital balance brought forward at Rs.42,35,691.87 is due to the disclosure of 3 ITA No.1014/Del/2020 the transaction in the bank and shares at USA and Singapore. The assessee had claimed that the shares and balances at foreign banks were proceeds of his foreign source income when he was a non- resident in previous years and after returning India in 2009 was investing using foreign bank accounts. The Assessing Officer was not satisfied with the submissions and made the addition of Rs.238,38,171 as undisclosed investments under Section 68 of the Act on following counts; a. Stock in Trade of Shares as on 01.04.2014 : Rs.1,35,72,924.85 b. Enhancement in Current Assets as on 01.04.2014 : Rs.1,02,65,246.14 Total fresh assets introduced : Rs.2,38,38,170.99 ” 4. In appeal, learned Commissioner (Appeals) was satisfied with the pleas of the assessee and deleted the addition of 238,38,170.99 for which Revenue is in appeal raising following grounds: 1. Whether the Ld. CIT(A) was correct in allowing the relief based merely on the submission of the assessee that the shares were acquired out of income of assessee when he was Non-resident , without detailing and examining the evidences which establish the same? 2. Whether the Ld. CIT(A) was correct in allowing the relief based merely on the submission of the assessee that the amount reflected in foreign banks was derived from 4 ITA No.1014/Del/2020 income of assessee when he was Non-resident, without detailing and examining the evidences which establish the same? 3. Whether the Ld. CIT(A) was correct in deleting the addition of Rs.2,38,38,171/- made by AO on account of unexplained investment, relying on the judgment in the case of CIT vs. Amritha Cyber Park (P) Ltd. (2019) 105 Taxmann.com (Kerala) which was given in different set of facts? 4. Whether the Ld. CIT(A) was correct in deleting the addition of Rs.2,38,38,171/- made by AO under Income- Tax Act, relying on Circular No.13 of 2015 dated 06.07.2015 which pertains to the one time compliance window under the Black Money (Undisclosed Foreign Income and Assets) and imposition of Tax Act, 2015 (in short Black Money Act) especially when the part of the circular relied upon by learned Commissioner (Appeals) clarified only a point that no declaration, under one time compliance window, in relation to foreign assets acquired out to income earned by a tax payer when he was a non- resident, needed to be filed because such assets do not fall under the definition of undisclosed foreign asset for the purposes of Black Money Act. 5. Whether the Ld. CIT(A) was correct in not appreciating the fact that the assets reflected abruptly for the first time by the assessee during the year constitute the ‘sum credited’ in the books of the assessee for the previous year. 6. Learned Departmental Representative has defended the findings of the Assessing Officer and submitted that learned Commissioner (Appeals) has erred in relying Circular No.13 of 2015 dated 06.07.2015. 5 ITA No.1014/Del/2020 7. Learned authorized representative, however, relied on the submissions which were made before the learned Commissioner (Appeals) and added nothing substantial further. 9. As we take into consideration the material before us and the submissions, it comes up that it is not disputed that Singapore and American Bank accounts, balances as on 01.04.2014 were acquired by the assessee out of income earned outside India as a non-resident. The Circular No.13 of 2015 by way of question no.21 as relied upon by learned Commissioner (Appeals) clarifies that the foreign assets acquired out of income which was not chargeable to tax in India, is not required to be declared under section 59 of Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015 (Black Money Act). Thus, the stocks and shares of foreign companies or Indian companies held by the assessee, being earned as exempt income of non-resident, when introduced in the capital account during the year could not have been considered, as unexplained cash credits, for an addition under Section 68 of the Act. The assessee had sufficiently discharged the burden of proof of the source of these cash credit entries in the accounts of assessee. There is 6 ITA No.1014/Del/2020 no error in conclusions of CIT(A). Thus, the grounds raised by the Revenue have no substance. 10. In the result, the appeal of the Revenue is dismissed. Order pronounced in the open court on 10/06/2024. Sd/- Sd/- (G.S. PANNU) ( ANUBHAV SHARMA) VICE-PRESIDENT JUDICIAL MEMBER Dated: 10 th June, 2024. Mohan Lal Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(A) 5. DR Asst. Registrar, ITAT, New Delhi