M.Vijaya Kumari, Kadapa, Hyderabad V. ITO, Ward-1, Kadapa, Kadapa

ITA 1031/HYD/2016

• Counselvise Citation: [2021] 108 COUNSELVISE.COM (IT) 2858 (ITAT-HYDERABAD)
• Duration Of Justice: 4 year(s) 10 month(s) 30 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-06-2021
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: DB-B
• Next Hearing Date: 12-05-2021
• Assessment Year: 2011-2012
• Appeal Filed On: 18-07-2016
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Assessee Lawyers: S RAMA RAO
• Keywords: Unexplained cash credit

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCHES B : HYDERABAD (THROUGH VIDEO CONFERENCE) BEFORE SHRI S.S.GODARA, JUDICIAL MEMBER AND SHRI LAXMI PRASAD SAHU, ACCOUNTANT MEMBER ITA NO. A.Y. APPELLANT RESPONDENT 1029/HYD/16 2009-10 SMT. M.VIJAYA KUMARI, KADAPA [PAN: BVCPK8435P] INCOME TAX OFFICER, WARD-1, KADAPA 1030/HYD/16 2010-11 1031/HYD/16 2011-12 FOR ASSESSEE : SHRI S.RAMA RAO, AR FOR REVENUE : SHRI ROHIT MUJUMDAR, DR DATE OF HEARING : 12-05-2021 DATE OF PRONOUNCEMENT : 17-06-2021 O R D E R PER S.S.GODARA, J.M. : THESE ASSESSEES APPEALS FOR AYS.2009-10, 2010-11 & 2011-12 ARISE AGAINST CIT(A)-KURNOOLS ORDER(S) DATED 29-04- 2016 PASSED IN CASE NOS.309, 311 & 310/CIT(A),KNL/2 013-14, INVOLVING PROCEEDINGS U/S.143(3) OF THE INCOME TAX A CT, 1961 [IN SHORT, THE ACT] ; RESPECTIVELY. HEARD BOTH THE PARTIES. CASE FILES PERUSED. 2. A COMBINED PERUSAL OF THE ASSESSEES PLEADINGS IN ALL THESE THREE ASSESSMENT YEARS INDICATES THAT HER FORMER SUBSTANTIVE GROUND IN AY.2009-10S APPEAL ITA ITA NOS. 1029, 1030 & 1031/HYD/2016 :- 2 -: NO.1029/HYD/2016 SEEKS TO REVERSE BOTH THE LOWER AUTHORITIES ACTION MAKING UN-EXPLAINED CREDITS ADDITI ON OF RS.1,21,65,000/- FOLLOWED BY DISALLOWANCE OF AGRICU LTURAL INCOME OF RS.2 LAKHS IN FIRST AND RS.2,40,000/- AND RS.2,80,000/-; ON LATTER TWIN ASSESSMENT YEARS; RESPEC TIVELY. 3. WE COME TO THE FIRST ISSUE OF UN-EXPLAINED CREDITS ADDITION OF RS.1,21,65,000/- IN AY.2009-10 AND NOTICE THAT THE CIT(A)S DETAILED DISCUSSION HAS AFFIRMED THE ASSE SSING OFFICERS ACTION TO THIS EFFECT AS UNDER: 5.2 GROUND NOS.2 & 3: THE APPELLANT CONTENDS THAT NO AMOUNT WAS PAID FOR ACQUISITION OF THE PROPERTY IN QUESTION. I N THE ASSESSMENT ORDER, THE AO HAS, VIDE PARA 9 OF THE ORDER, HAS RE JECTED THE EXPLANATION GIVEN BY THE APPELLANT FOR ACCUMULATION OF THE OPENING BALANCE IN HER BOOKS FOR A SUM OF RS.1,21,65,000/- AND THE SAME HAS BEEN ADDED U/S.68 OF THE ACT. IT IS NOT WITH REGARD TO THE TRANSFER OF PROPERTY THAT THE ADDITION CAME TO BE MADE, BUT IT IS FOR THE FACT THAT THE AO DISBELIEVED THE AVAILABILITY OF OPENING CASH BA1ANCE ARID ACCORDINGLY, THE AO HAS MADE A SPEAKING ORDER AS TO HOW THE ACCUMULATION OF THE CAPITAL BALANCES AS CLAIMED BY THE APPELLANT WOULD NOT BE TAKEN INTO CONSIDERATION AND WENT ON T O MAKE AN ADDITION U/S.69 OF THE ACT. THE SALE DEED AND CONSE QUENTIAL RECTIFICATION AND VARIOUS PETITIONS FILED BY THE AP PELLANT TO JUSTIFY, IS ONLY AN AFTERTHOUGHT AND HAS NO RELEVANCE TO THE PR IMARY ISSUE OF THE UNACCOUNTED CAPITAL INTRODUCED TO THE BOOKS BY THE APPELLANT. IN THIS CONTEXT, THE SURVEY DONE IN THE CASE OF M/S. LIMRA DEVELOPERS AND BUILDERS, IT IS CLEARLY ESTABLISHED THAT A SUM OF R S.1,21,52,000/- IS RECORDED AS SALE CONSIDERATION RECEIVED FROM SMT.M. VIJAYA KUMARI TOWARDS PROPERTY TRANSACTION WHICH IS NOW BEING DIS TORTED FROM THE FACTUAL MATRIX BY THE APPELLANT. THE DEPONENT HAS C LEARLY GONE ON RECORD TO SAY THAT AN EXTENT OF 5.82 ACRES OF LAND IN SURVEY NO.17/1 TO 17/3 AND S.NO.480/B HAS BEEN SOLD TO SMT.VIJAYA KUMARI W/O SRI BALA KRISHNA. THE DOCUMENT WAS REGISTERED ON 22.11. 2010 IN SUB- REGISTRAR OFFICE (RURAL), KADAPA. THIS IS A CLINCHI NG EVIDENCE TO SHOW THAT THE CONSIDERATION HAS CHANGED HANDS AND THAT I N ORDER TO JUSTIFY THIS UNACCOUNTED TRANSACTION MADE BY THE APPELLANT, ENTRIES WERE RAISED IN THE BOOKS OF ACCOUNT SO AS TO SHOW THAT T HERE WAS AN OPENING BALANCE TO JUSTIFY THIS INVESTMENT. THE STA ND OF THE APPELLANT THAT THE SALE DEED WAS EXECUTED ONLY TO CONVEY THE TITLE OF THE PROPERTY AND NO PAYMENT WAS EFFECTED, DOES NOT STAN D THE TEST OF ITA NOS. 1029, 1030 & 1031/HYD/2016 :- 3 -: REASON, NOR THE PROCEDURE GOVERNING THE TRANSFER OF PROPERTY ACT ENDORSE SUCH AN ARRANGEMENT. IN ANY CASE, THE PRIMA RY EDIFICE ON WHICH THE AO HAS PROCEEDED TO MAKE THE ADDITION U/S .69 OF THE ACT, STANDS VINDICATED AS A RESULT OF THE DETAILED ENQUI RY CONDUCTED BY THE AO, BASED ON WHICH IT IS EVIDENCED THAT THE APP ELLANT HAS NO VERIFYIABLE SOURCES FOR THE SUM OF RS.1,21,52,000/- AND THE ADDITION THEREFORE, MADE IS JUSTIFIED AND I REFUSE TO INTERF ERE WITH THE STAND TAKEN BY THE AO, WHICH IS RIGHT IN LAW. ACCORDINGLY , THE GROUNDS RAISED ON THIS COUNT ARE DISMISSED. 3.1. LEARNED COUNSEL STRONGLY ARGUED THAT BOTH THE LOW ER AUTHORITIES HAVE ERRED IN LAW AND ON FACTS IN MAKING THE IMPUGNED UNEXPLAINED CREDITS ADDITION OF RS.1,21,52,0 00/- DESPITE THE FACT THAT THE SAME FORMED ONLY THE OPENING BA LANCE AS ON 01-04-2008 AND THEREFORE DESERVES TO BE DELETED. WE PUT A SPECIFIC QUERY TO THE LEARNED COUNSEL AS TO WHETHER THE ASSESSEE HAS EARLIER FILED ANY RETURN(S) OR THE SAID SO CALLED OPENING BALANCE STOOD ASSESSED AS CLOSING BALANCE AS ON 31-03-2008 OR NOT? THE REPLY RECEIVED IS NEGATIVE ONL Y. WE THEREFORE EXPRESS OUR INABILITY TO ACCEPT THE ASSESSEE S ALLEGED OPENING BALANCE PLEA IN ABOVE TERMS. IT HAS COME ON RECORD THAT SHE HAS FAILED TO EXPLAIN THE SOURCE OF HER PURCH ASE CONSIDERATION AMOUNTING TO RS.1,21,52,000/- BY ANY ME ANS IN THE COURSE OF ASSESSMENT IN LOWER APPELLATE PROCEEDING S. WE THUS FIND NO REASON TO INTERFERE WITH THE IMPUGNED ADDI TION IN PRINCIPLE. 4. NEXT COMES EQUALLY IMPORTANT ASPECT OF QUANTIFICATIO N OF THE IMPUGNED ADDITION. LEARNED DEPARTMENTAL REPRESENTATIV E FAILS TO DISPUTE THAT NEITHER THE ASSESSING OFFICER NOR THE CIT(A) HAVE CONSIDERED THE ASSESSEES PERSONAL AND HOUSEHOLDS SAVINGS IS IN THE LIGHT OF HER SOCIO-ECON OMIC ITA NOS. 1029, 1030 & 1031/HYD/2016 :- 4 -: STATUS. WE THUS DEEM IT APPROPRIATE THAT A LUMP SUM RELIE F OF RS.20 LAKHS IN THE GIVEN FACTS AND CIRCUMSTANCES DESER VES TO BE GRANTED TO THE ASSESSEE SUBJECT TO THE RIDER THAT THE SAME SHALL NOT BE TREATED AS A PRECEDENT IN ANY OTHER CASE. WE ACCORDINGLY DIRECT THE ASSESSING OFFICER TO RESTRICT THE IMPUGNED ADDITION TO THE EXTENT OF RS.1,01,65,000/- IN FOREGOING TERMS. THE ASSESSEES FORMER SUBSTANTIVE GR IEVANCE IS PARTLY ACCEPTED. 5. NEXT COMES AGRICULTURAL INCOME DISALLOWANCE(S) OF RS.2 LAKHS, RS.2,40,000/- AND RS.2,80,000/-; IN ALL THESE THREE YEARS RESPECTIVELY. IT HAS COME ON RECORD THAT SHE HAD PURCHASED 5.82 ACRES OF LAND AS ON 22-11-2010. MEA NING THEREBY THAT THE SAID LAND WAS AVAILABLE FOR RABI CUL TIVATION IN FY.2008-09. COUPLED WITH THIS, LEARNED DEPARTMENTAL REPRESENTATIVE COULD NOT REBUT THE EVIDENCE ON RECORD TH AT THE ASSESSEES FAMILY HAD BEEN CULTIVATING AGRICULTURAL L ANDS AS PER DOCUMENTS FILED IN HER PAPER BOOK (PGS.4 TO 6). THE FACT ALSO REMAINS THAT ALL THESE IMPUGNED SUMS HAVE BEEN DEPOSITE D IN CASH MODE ONLY. 5.1. FACED WITH THIS SITUATION, WE DEEM IT APPROPRIATE THAT A LUMP SUM ADDITION OF RS.50,000/-, RS.40,000/- AND RS.30,0000/-; ASSESSMENT YEAR-WISE, RESPECTIVELY WOUL D MEET THE ENDS OF JUSTICE WITH A RIDER THAT THE SAME SHALL NOT BE TAKEN AS A PRECEDENT IN ANY OTHER CASE. THE ASSESSEE G ETS RELIEF OF RS.1.5 LAKHS, RS.2 LAKHS AND RS.2.5 LAKHS, ASSES SMENT YEAR- WISE; RESPECTIVELY. NECESSARY COMPUTATION SHALL FOLLOW AS PER LAW. ITA NOS. 1029, 1030 & 1031/HYD/2016 :- 5 -: 6. THESE ASSESSEES THREE APPEALS ARE PARTLY ALLOWED IN ABOVE TERMS. A COPY OF THIS COMMON ORDER BE PLACED IN THE RESPECTIVE CASE FILES. ORDER PRONOUNCED IN THE OPEN COURT ON 17 TH JUNE, 2021 SD/- SD/- (LAXMI PRASAD SAHU) (S.S.G ODARA) ACCOUNTANT MEMBER JUDICIAL MEM BER HYDERABAD, DATED: 17-06-2021 TNMM ITA NOS. 1029, 1030 & 1031/HYD/2016 :- 6 -: COPY TO : 1.SMT. M.VIJAYA KUMARI, C/O.SRI S.RAMA RAO, ADVOCAT E, FLAT NO.102, SHRIYAS ELEGANCE, 3-6-643, STREET NO. 9, HIMAYAT NAGAR, HYDERABAD. 2.THE INCOME TAX OFFICER, WARD-1, KADAPA. 3.CIT(APPEALS)-KURNOOL. 4.PR.CIT-KURNOOL. 5.D.R.ITAT, HYDERABAD. 6.GUARD FILE.