DCIT, Coimbatore V. N.Muthusamy, Coimbatore

ITA 1032/CHNY/2017

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 5945 (ITAT-CHENNAI)
• Duration Of Justice: 5 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-10-2017
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2010-2011
• Appeal Filed On: 26-04-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Unexplained investment; Unexplained expenditure; Income from undisclosed sources; Search and seizure

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH: CHENNAI . , ! , $ % BEFORE SHRI ABRAHAM P.GEORGE, ACCOUNTANT MEMBER AND SHRI GEORGE MATHAN, JUDICIAL MEMBER ./ ITA NOS.1036 & 1030 TO 1033/MDS/2017 $! ! /ASSESSMENT YEARS: 2007-08 TO 2011-12 THE DY. COMMISSIONER OF- INCOME TAX, CENTRAL CIRCLE-1, AAYAKAR BHAVAN, 63, RACE COURSE ROAD, COIMBATORE-641 018. VS. SHRI N.MUTHUSAMY, NO.16, SYRIAN CHURCH ROAD NO.1, COIMBATORE-641 001. [PAN: AHHPM 7025 M ] ( ' /APPELLANT) ( ()' /RESPONDENT) D EPARTMENT BY : MRS.RUBY GEORGE, CIT ASSESSEE BY : MR.S.SRIDHAR, ADV. + /DATE OF HEARING : 19.10.2017 + /DATE OF PRONOUNCEMENT : 19.10.2017 / O R D E R PER BENCH : THESE APPEALS ARE FILED BY THE REVENUE AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS)-18, CHENNAI, I N ITA NOS.78 TO 82/15-16 DATED 09.01.2017 FOR THE AYS 2007-08 TO 20 11-12. 2. MRS.RUBY GEORGE, CIT REPRESENTED ON BEHALF OF TH E REVENUE AND MR.S.SRIDHAR, ADV., REPRESENTED ON BEHALF OF THE AS SESSEE. ITA NOS.1036 & 1030 TO 1033/MDS/2017 :- 2 -: 3. IT WAS SUBMITTED BY THE LD.DR THAT THERE WAS A S EARCH CONDUCTED ON THE PREMISES OF THE ASSESSEE ON 19.03.2013. IN THE COURSE OF THE SEARCH, THE FOLLOWING INCRIMINATING MATERIALS ARE FOUND AS MENTIONED IN PAGE NO.2 OF THE ASSESSMENT ORDER: SL.NO. DETAILS OF UNACCOUNTED INCOME/ UNEXPLAINED INVESTMENTS AMOUNT 1 UNACCOUNTED CASH FOUND IN THE RESIDENCE OF SHRI N. MUTHUSAMY @ BOSE AT NO.1, SKV NAGAR, SUBBIAN NAGAR EXTENSION, KK PUDUR, SAIBABA COLONY, COIMBATORE - 641 038 RS.52,70,000/- 2 INVESTMENT IN JEWELLERY UNEARTHED DURING THE COURSE OF SEARCH AND SEIZURE OPERATION WEIGHING 3235.620 GRAMS OF GOLD AND 78.75 CARATS OF DIAMOND RS.1,36,88,324/- 3 INVESTMENTS MADE IN IMMOVABLE PROPERTIES RS.10,42,00,000/- 4 INCOME FROM LIAISON WORK PART RECEIPT FROM M/S.SREEVATSA REAL ESTATES PVT. LTD. * RS 18,56,856/- 5 UNEXPLAINED INVESTMENTS AND EXPENDITURES AMOUNT PAID TO SHRI SHANMUGASUNDARAM, MYSORE RS.1,24,40,000/- 6 UNEXPLAINED EXPENDITURE MADE: ADVANCE PAID TO MR.V.M. RAMESH, COIMBATORE RS.93,00,000/- 7 UNEXPLAINED BALANCES IN BANKS RS.1,93,83,272/- TOTAL RS.16,61,38,452/- 4. A NOTICE U/S.153A WAS ISSUED ON THE ASSESSEE ON 09.12.2013. RETURNS HAD BEEN FILED BY THE ASSESSEE IN RESPONSE TO THE NOTICES U/S.153A. THE ASSESSMENT CAME TO BE COMPLETED U/S.1 53A R.W.S.143(3) ON 31.03.2015, WHEREIN THE AO HAD BROUGHT TO TAX UN EXPLAINED ITA NOS.1036 & 1030 TO 1033/MDS/2017 :- 3 -: INVESTMENTS U/S.69B IN RESPECT OF THE INVESTMENTS M ADE BY THE ASSESSEE FOR EACH OF THE ASSESSMENT YEAR AS FOLLOWS: SL.NO. ASST. YEAR DETAILS OF ADDITIONS ADDITION MADE (IN RS.) 1 2007-08 UNEXPLAINED INVESTMENTS U/S.69B 13,20,000/- 2 2008-09 6,00,000/- 3 2009-10 29,24,650/- 4 2010-11 1,23,67,830/- 5 2011-12 49,71,662/- 5. IT WAS A SUBMISSION THAT ON APPEAL, LD.CIT(A) HA D ALLOWED THE ASSESSEES CLAIM HOLDING THAT THERE WAS NO INCRIMIN ATING MATERIALS FOUND DURING THE COURSE OF SEARCH FOR THE PURPOSE OF MAKI NG THE ADDITIONS. IT WAS A SUBMISSION THAT THE LD.CIT(A) HAD FOLLOWED TH E DECISION OF THE SPECIAL BENCH OF THE TRIBUNAL IN THE CASE OF ALL CA RGO GLOBAL LOGISTICS LTD. VS. DCIT (2012) 137 ITD 287 (MUM) (SB) AS ALSO THE DECISION IN THE CASE OF JAI STEEL (INDIA) V. ACIT (2013) 88 DTR (RAJ) AN D ALSO THE DECISION OF THE JURISDICTIONAL BENCH OF THE ITAT IN THE CASE OF ABS SANJAY VS. ACIT IN ITA NOS.1691, 1692 & 1693(MDS)/2013. 6. IT WAS A SUBMISSION THAT AS INCRIMINATING MATERI ALS HAD BEEN FOUND IN THE COURSE OF SEARCH IN THE CASE OF THE ASSESSEE , THE ADDITIONS MADE BY THE AO REPRESENTING THE UNEXPLAINED INVESTMENTS WER E LIABLE TO BE SUSTAINED AND THE ORDER OF THE LD.CIT(A) BE REVERSE D. 7. IN REPLY, THE LD.AR VEHEMENTLY SUPPORTED THE ORD ER OF THE LD.CIT(A). IT WAS A SUBMISSION THAT THERE WERE NO INCRIMINATING MATERIALS ITA NOS.1036 & 1030 TO 1033/MDS/2017 :- 4 -: FOUND IN THE COURSE OF THE SEARCH WHICH WERE RELATA BLE TO THE ADDITIONS MADE. IT WAS A SUBMISSION THAT CONSEQUENTLY, THE D ECISION RELIED UPON BY THE ASSESSEE BEFORE THE LD.CIT(A) DIRECTLY APPLIED TO THE ASSESSEES CASE AND THE ADDITIONS HAD RIGHTLY BEEN DELETED BY THE L D.CIT(A). 8. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. A PER USAL OF THE ASSESSMENT ORDER CLEARLY SHOWS THAT IN PAGE NO.2 AT PARA NO.2, THE AO HAS EXTRACTED THE CHART OF THE DETAILS AS UNACCOUNT ED INCOME OR UNEXPLAINED INVESTMENTS AS FOUND DURING THE COURSE OF THE SEARCH. HOWEVER, A PERUSAL OF THE ASSESSMENT ORDER IN PAGE NO.7 AT PARA NO.7 WHERE THE AO HAS MADE THE ADDITION IN RESPECT OF TH E UNEXPLAINED INVESTMENTS BY INVOKING THE PROVISIONS OF SEC.69B S HOWS THAT THE AO HAS TAKEN THE RETURNED TOTAL INCOME OF THE ASSESSEE AS PER THE RETURN INCOME FILED U/S.153A WHICH IS ALSO IDENTICAL TO THE RETUR N ORIGINALLY FILED AND HAS MADE THE ADDITION BY TAKING INVESTMENTS AS DISCLOSE D IN THE SAID RETURN AND TRACING THE SOURCE FOR THE SAME FROM THE SOURCE S OF INCOME WHICH IS DISCLOSED IN THE RETURN. THE AO HAS NOT REFERRED T O NOR TAKEN RECOURSE TO ANY OF THE INCRIMINATING MATERIALS FOR THE PURPOSE OF MAKING ADDITION U/S.69B OF THE ACT. THIS BEING SO, CLEARLY NO INCR IMINATING MATERIALS RELATABLE TO THE ADDITIONS MADE ARE AVAILABLE AND C ONSEQUENTLY, IN VIEW OF THE DECISION OF THE HONBLE SPECIAL BENCH IN THE CA SE OF ALL CARGO GLOBAL LOGISTICS LTD. VS. DCIT (2012) 137 ITD 287 (MUM) (S B) AS ALSO THE DECISION IN THE CASE OF JAI STEEL (INDIA) V. ACIT ( 2013) 88 DTR (RAJ) AND ALSO THE DECISION OF THE CO-ORDINATE BENCH OF THIS TRIBUNAL IN THE CASE OF ITA NOS.1036 & 1030 TO 1033/MDS/2017 :- 5 -: ABS SANJAY VS. ACIT REFERRED TO SUPRA, CLEARLY APPL IED TO THE FACTS OF THE ASSESSEES CASE. THIS BEING SO, THE REVENUE HAS NO T BEEN ABLE TO DISLODGE THE FINDINGS AS HAS BEEN ARRIVED BY THE LD.CIT(A). RESPECTFULLY FOLLOWING THE DECISION OF THE SPECIAL BENCH OF THIS TRIBUNAL AS ALSO THE DECISION OF THE HONBLE RAJASTHAN HIGH COURT IN THE CASE OF JAI STEEL (INDIA) V. ACIT, THE FINDINGS OF THE LD.CIT(A) ON THIS ISSUE STANDS CONFIRMED. 9. IN THE RESULT, THE APPEALS FILED BY THE REVENUE STANDS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON OCTOBER 19, 2017, AT CHENNAI. SD/- SD/- ( . ) ( ABRAHAM P GEORGE ) /ACCOUNTANT MEMBER ( ! ) (GEORGE MATHAN) $ /JUDICIAL MEMBER /CHENNAI, 0 /DATED: OCTOBER 19, 2017. TLN + ($12 32 /COPY TO: 1. ' /APPELLANT 4. 4 /CIT 2. ()' /RESPONDENT 5. 2 ($$ /DR 3. 4 ( ) /CIT(A) 6. ! /GF