ITO, New Delhi V. Smt. Nishat Bano, New Delhi

ITA 1136/DEL/2011

• Counselvise Citation: [2011] 140 COUNSELVISE.COM (IT) 53436 (ITAT-DELHI)
• Duration Of Justice: 9 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-12-2011
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: E
• Next Hearing Date: 20-12-2011
• Assessment Year: 2006-2007
• Appeal Filed On: 01-03-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: R S NEGI SENIOR
• Section: 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH E : NEW DELHI) BEFORE SHRI RAJPAL YADAV, JUDICIAL MEMBER AND SHRI B.C. MEENA, ACCOUNTANT MEMBER ITA NO.1136/DEL./2011 (ASSESSMENT YEAR : 2006-07) ITO, WARD 30 (1), VS. SMT. NISHAT BANO, NEW DELHI. 2015, KUCHA CHALLAN, DARYAGANJ, NEW DELHI. (PAN : AINPB9117G) (APPELLANT) (RESPONDENT) ASSESSEE BY : NONE REVENUE BY : SHRI R.S. NEGI, SENIOR DR ORDER PER B.C. MEENA, ACCOUNTANT MEMBER : THIS APPEAL FILED BY THE REVENUE EMANATES FROM THE ORDER OF CIT (APPEALS)-XXV, NEW DELHI DATED 20.12.2010 FOR THE ASSESSMENT YEAR 2006-07. THE GROUNDS OF APPEAL READ AS UNDER :- '1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE, LD. CIT(A) HAS ERRED IN RESTRICTING THE ADDITION, TO RS.50,000/- A GAINST THE ADDITION OF RS.10,97,600/- MADE BY THE AO, IGNORING THAT THE SO URCE OF CASH DEPOSITS AND PURPOSE OF WITHDRAWALS HAVE NOT BEEN EXPLAINED BY THE ASSESSEE, NEITHER BEFORE THE ASSESSING OFFICER NOR BEFORE LD. CIT(A) AND ALS O THE CASH DEPOSIT DO NOT COMMENSURATE WITH THE DECLARED BUSINESS OR THE ASSESSEE. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E, LD. CIT(A) ERRED IN DIRECTING TO ADOPT PEAK OF CREDIT FOR ADDITION I GNORING THAT RELEVANT MATERIAL TO ESTABLISH THAT THE AMOUNT WITHDRAWN FRO M THE BANK HAS NOT BEEN UTILIZED ANYWHERE AND THE SAME HAS BEEN RECYCLED IN THE ACCOUNT, ARE NOT FURNISHED BY THE ASSESSEE. ITA NO.5507/DEL./2010 2 3. THE APPELLANT CRAVES LEAVE FOR RESERVING THE RIG HT TO AMEND, MODIFY, ALTER, ADD OR FOREGO ANY GROUND(S) OF APPEAL AT ANY TIME BEFORE OR DURING THE HEARING OR THIS APPEAL.' 2. THE ONLY ISSUE INVOLVED IN THESE GROUNDS IS REST RICTING THE ADDITION TO RS.50,000/- AGAINST THE ADDITION OF RS.10,97,600/- (TOTAL CASH DEPOSIT IN THE BANK OF THE ASSESSEE). 3. NONE ATTENDED ON BEHALF OF THE ASSESSEE. LEARNE D DR WAS HEARD. 4. THE ASSESSEE IS AN INDIVIDUAL. THE ASSESSEE IS ALSO ENGAGED IN THE SMALL BUSINESS OF STITCHING AND EMBROIDERY DURING THE YEAR UNDER CONS IDERATION. THE RETURN OF INCOME WAS FILED ON 07.11.2006 DECLARING INCOME AT RS.1,38,963 /-. THERE WAS A CASH DEPOSIT IN THE BANK ACCOUNT OF THE ASSESSEE TOTALING TO RS.10,97,6 00/-. THE ASSESSING OFFICER MADE AN ORDER U/S 144 OF THE INCOME-TAX ACT AND ADDED THE A MOUNT OF RS.10,97,600/- U/S 68/69A OF THE INCOME-TAX ACT. THE ASSESSEE HAS FILED THE AP PEAL BEFORE THE CIT (A). THE CIT (A) GRANTED PART RELIEF BY HOLDING AS UNDER :- '3.6 I HAVE CONSIDERED THE EX PARTE ORDER U/S 144, REMAND REPORT OF THE AO AND THE SUBMISSION OF THE ASSESSEE. I FIND CONSI DERABLE MERIT IN THE SUBMISSION OF THE ASSESSEE THAT THE AO HAS IGNORED THE CORRESPONDING CASH WITHDRAWAL OF RS.9,77,585/- ON VARIOUS DATES AS AGA INST THE CASH DEPOSIT OF RS.10,97,600/- WHICH ARE ALSO ON VARIOUS DATES AS D ISCUSSED ABOVE. IT IS APPARENT FROM THE BANK STATEMENT THAT THE ASSESSEE IS A VERY SMALL ASSESSEE AND LARGE NUMBER OF SMALL AMOUNTS OF CASH HAS BEEN DEPOSITED AND CORRESPONDING CASH WITHDRAWALS HAVE BEEN MADE THROU GHOUT THE YEAR. I AM OF THE VIEW THAT THE AO HAS NOT BEEN FAIR IN ASSESS ING THE ENTIRE CASH DEPOSITS WHICH ARE MADE ON VARIOUS DATES AND IGNORI NG THE CORRESPONDING CASH WITHDRAWALS. IT IS ALSO SEEN THAT AT ANYONE PO INT OF TIME THE MAXIMUM CASH DEPOSIT IS OF RS.49,900/- ONLY. THE AO SHOULD HAVE CONSIDERED BOTH THE CASH DEPOSITS AND THE CORRESPONDING CASH WITHDR AWALS AND SHOULD HAVE TAKEN A HOLISTIC PICTURE OF THE ENTIRE BANK STATEME NT. THERE IS NO DENYING THAT THE ASSESSEE IS TOO SMALL AND THERE IS MERIT I N THE SUBMISSION OF THE ASSESSEE THAT SHE HAS NOT BEEN ABLE TO ENGAGE A LAW YER TO REPRESENT HER CASE. AFTER CONSIDERING THE FACTS AND CIRCUMSTANCES OF TH E CASE, I AM OF THE VIEW THAT THE AO IS NOT JUSTIFIED TO MAKE THE ADDITION. HOWEVER. CONSIDERING THAT THE ASSESSEE HAS NOT COMPLIED WITH THE NOTICES OF T HE AO AND THERE ARC FREQUENT CASH DEPOSITS AND WITHDRAWALS, SOME LIABIL ITY SHOULD FALL ON THE ASSESSEE FOR THE POSSIBLE LEAKAGE OF REVENUE AND AC CORDINGLY, A LUMP-SUM ADDITION OF RS.50,000/- IS CONFIRMED AND THE BALANC E AMOUNT OF RS.10,47,600/- IS DELETED.' ITA NO.5507/DEL./2010 3 5. AFTER HEARING THE LEARNED DR, WE HOLD THAT THE C IT (A) HAS SUSTAINED THE ADDITION AT THE PEAK OF THE DEPOSIT WHICH IS RS.49,900/-. T HERE WERE CASH WITHDRAWAL AND DEPOSITS IN HER ACCOUNT. THE REVENUE HAS FAILED TO ESTABLIS H THAT THE CASH WITHDRAWALS WERE NOT AVAILABLE FOR REDEPOSIT IN THE BANK OR THESE AMOUNT S ARE INVESTED/UTILIZED SOMEWHERE ELSE. THE ASSESSEE WAS ENGAGED IN SMALL BUSINESS OF STITC HING AND EMBROIDERY DURING THE YEAR UNDER CONSIDERATION. THERE ARE SMALL CASH DEPOSITS ON 29 OCCASIONS ON VARIOUS DATES DURING THE RELEVANT PERIOD AND THERE ARE 47 TIMES C ASH WITHDRAWAL TRANSACTIONS. ALL THESE SHOW THAT THERE WAS NO CAPITAL FORMATION ON THE PAR T OF THE ASSESSEE. THESE APPEAR TO BE TRANSACTION IN THE NORMAL COURSE OF BUSINESS AND TH E CIT (A) HAS SUSTAINED THE ADDITION AT THE PEAK AMOUNT. CONSIDERING ALL THESE ASPECTS, WE FIND NO FAULT IN THE ORDER OF THE CIT(A) AND DISMISS THE REVENUES APPEAL. 6. IN THE RESULT, THE APPEAL OF THE REVENUE STANDS DISMISSED ORDER PRONOUNCED IN OPEN COURT ON THIS 20 TH DAY OF DECEMBER, 2011. SD/- SD/- (RAJPAL YADAV) (B.C. MEENA) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED THE 20 TH DAY OF DECEMBER, 2011 TS COPY FORWARDED TO: 1.APPELLANT 2.RESPONDENT 3.CIT 4.CIT(A)-XXV, NEW DELHI. 5.CIT(ITAT), NEW DELHI. AR, ITAT NEW DELHI.