Zarnaben Vibhashbhai Sheth, RAJKOT-GUJARAT V. The Income Tax Officer, Ward-5(1), RAJKOT-GUJARAT

ITA 115/RJT/2011

• Counselvise Citation: 11524914 RSA 2011
• Duration Of Justice: 2 year(s) 2 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-06-2013
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 06-06-2013
• Assessment Year: 2004-2005
• Appeal Filed On: 06-04-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: K C MATHEWS
• Assessee Lawyers: DR ADHIA
• Keywords: Unexplained cash credit; Gift; Onus to prove
• Section: 143(3)

Judgement Text

0 : S : IN THE INCOME TAX APPELLATE TRIBUNAL: RAJKOT BENCH: RAJKOT . . R . . BEFORE SHRI T. K. SHARMA JM AND SHRI D. K. SRIVASTAVA AM ITA NO 1 15 /R JT /2011 .3 3 / ASSESSMENT YEAR 200 4 - 05 ZARNABEN VIBHASHBHAI SHETH V. IT O SANJAY AND COMPANY WARD - 5(1) PREMJEES, FIRST FLOOR, RAJKOT RAJPUT PARA MAINROAD, RAJKOT PAN: A KOPS0289D DATE OF HEARING: 06 .0 6 .2013 DATE OF PRONOUNCEMENT: 21 .0 6 . 2013 FOR THE ASSESSEE: D.R ADHIA, AR FOR THE REVENUE : K. C. MATHEWS , DR / ORDER . . /D K SRIVASTAVA: A PPEAL FILED BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER PASSED BY THE CIT(A) ON 31 - 01 - 2011 , ON THE FOLLOWING GROUNDS: - 1 . T HE LD. C.I.T.(A) ERRED IN LAW AND ON FACTS IN NOT APPRECIATING THE SUBMISSIONS OF THE APPELLANT AND CONSEQUENTLY IN DISMISSING THE APPEAL FILED AGAINST THE ORDER UNDER SECTION 143(3) PASSED BY THE ITO,WARD - 5(1), RAJKOT. 2 . THE LD. C.I.T.(A) ERRED IN NOT TAKIN G IN TO CONSIDERATION SPECIFIC GROUNDS OF APPEAL TAKEN BEFORE HIM ABOUT THE GIFT OF RS.3,51,000/ - , UNEXPLAINED CASH CREDITS OF RS.1,05,000/ - & UNEXPLAINED CREDIT ENTRY OF RS.55,000/ - . 3 . THE ORDER OF THE LD. C.I.T.(A), BEING AGAINST WELL SETTLED LAW IN THIS B EHALF, DESERVES TO BE SET ASIDE, BECAUSE HE ALSO FAILED TO CONSIDER ON MERITS/WITHOUT GIVING ANY OPPORTUNITY. 2. THE ASSESSEE IS AN INDIVIDUAL. SHE FILED HER RETURN OF INCOME ON 10 - 06 - 2004 RETURNING TOTAL INCOME AT RS.1,10,860/ - . PERUSAL OF CAPITAL ACCOUN T FILED BY THE ASSESSEE BEFORE THE AO REVEAL ED THAT THE ASSESSEE HAD RECORDED RECEIPT OF RS.3,51,000/ - IN THE SAID CAPITAL ACCOUNT AS GIFT FROM SHRI AMULBHAI CHIMANLAL KAMDAR. THE ASSESSING OFFICER RECORDED THE STATEMENT OF SHRI AMULBHAI KAMDAR U/S.1 3 1 OF THE I - T ACT. HE ALSO PERUSED THE BANK ACCOUNT/STATEMENT OF SHRI 2 ITA 1 15 /201 1 AMULBHAI KAMDAR. HE NOTICED THAT A SUM OF RS.3,51,000/ - WAS DEPOSITED IN CASH IN THE BANK ACCOUNT OF ALLEGED DONOR IMMEDIATELY BEFORE THE DATE ON WHICH CHEQUE REPRESENTING THE AMOUNT OF GIFT W AS ISSUED BY HIM TO THE ASSESSEE. HE ALSO NOTICED THAT THERE WAS A MEAGRE BALANCE IN THE BANK ACCOUNT OF SHRI AMUL KAMDAR BEFORE A SUM OF RS.3,51,000/ - WAS DEPOSITED IN HIS ACCOUNT IN CASH. THE ASSESSING OFFICER THEREFORE DID NOT CONSIDER THE PLEA OF GIFT AS GENUINE. AFTER ISSUING A DETAILED SHOW CAUSE NOTICE AND CONSIDERING THE REPLY GIVEN BY THE ASSESSEE, THE ASSESSING OFFICER TREATED THE IMPUGNED GIFT AS UNEXPLAINED AND CONSEQUENTLY TAXED THE SAME, WITH THE FOLLOWING OBSERVATIONS: - 3.5 I HAVE CAREFULLY GONE THROUGH THE CONTENTIONS OF THE ASSESSEE . HOWEVER, I AM UNABLE TO FEEL CONVINCED WITH THE EXPLANATION FURNISHED BY THE ASSESSEE BECAUSE OF THE FOLLOWING REASONS: ( I ) CONTRARY TO ASSESSEES CLAIM THAT SHRI AMUL KAMDAR IS HER BROTHER, IT IS SEEN THAT THE D ONOR SHRI AMUL KAMDAR IS IN NO WAY RELATED TO THE ASSESSEE. ON VERIFICATION OF THE RECORDS ALSO, THIS FACT EMERGES. IN HIS STATEMENT RECORDED U/S. 131 OF THE IT ACT, SHRI AMUL KAMDAR COULD NOT EXACTLY DEFINE HIS RELATIONSHIP WITH ASSESSEE. IN THE ABSENC E OF ANY RELATIONSHIP, THE ELEMENT OF NATURAL LOVE AND AFFECTION WHICH COULD PROMPT THE DONOR TO GIVE THIS MUCH AMOUNT AS GIFT, DOES NOT EXIST. ( II ) IT IS SEEN THAT THOUGH SHRI AMUL KAMDAR IS ASSESSED TO TAX, HE HAS NO CAPACITY OF FUND TO GIFT SUCH A HUGE AMOUN T TO THE ASSESSEE. BESIDES INSPITE OF REQUESTED, SHRI AMUL KAMDAR HAS FAILED TO EXPLAIN THE SOURCE OF CASH AGGREGATING RS.3,51,000/ - DEPOSITED INTO HIS BANK ACCOUNT WITHIN THE SHORT SPAN OF THREE DAYS I.E. BETWEEN THE PERIOD 14/6/2003 TO 17/6/2003. ( III ) AS DISC USSED ABOVE, A CASH OF RS.3,51,000/ - IN AGGREGATE WAS DEPOSITED INTO ASSESSEES BANK ACCOUNT BETWEEN THE PERIOD 14/6/2002 TO 17/6/2003. AGAINST THE SAID DEPOSITS, A CHEQUE OF EQUAL AMOUNT BEARING NO.39761 DTD. 19.06.2003 FOR THE IMPUGNED GIFT WAS ISSUED WH ICH WAS CREDIT INTO THE ASSESSEES BANK ACCOUNT ON 3 ITA 1 15 /201 1 19.06.2003 ITSELF. THE PATTERN OF TRANSACTIONS IN THE BANK ACCOUNT CLEARLY SHOWS THAT THE ASSESSEE HAS MOTIVATED THE DONOR TO DEPOSIT THE CASH IN HIS ( SHRI KAMDARS ) BANK ACCOUNT WITH A VIEW TO DIVERTING THE SAID FUND IN HIS (ASSESSEES) OWN ACCOUNT BY WAY OF SO CALLED GIFT. 3.6 IN THE CIRCUMSTANCES AND ON THE FACTS DISCUSSED ABOVE, I HOLD THE AMOUNT OF GIFT OF RS.3,51,000/ - RECEIVED FROM SHRI KAMLESH BHALSOD AS BOGUS AND NON GENUINE AND TREAT THE SAME A S THE ASSESSEES INCOME OF THE YEAR UNDER CONSIDERATION. ACCORDINGLY AN ADDITION OF RS.3,51,000/ - IS MADE ON THIS COUNT. 3. T WO OTHER ADDITIONS BEING UNEXPLAINED CASH CREDITS (RS.1, 05,000/ - ) AND UNEXPLAINED CREDIT ENTRY (RS.55,000/ - ) WERE ALSO MADE BY T HE AO, WITH THE FOLLOWING OBSERVATIONS: - 4.2 THEREFORE THE ASSESSEE WAS REQUESTED VIDE THIS OFFICE LETTER NO.ITO.5(1)/SC/ZVS/2006 - 07 DTD. 13.10.2006 TO FURNISH THE PARTICULARS REGARDING NAME AND ADDRESS AT WHICH INDEPENDENT ENQUIRY COULD BE MADE. THE ASSESSEE WAS ALSO APPRISED OF THE FACTS THAT ADDITIONS COULD BE MADE ON THIS COUNT IN CASE SHE FAILS TO FURNISH THE DETAILS BY 19.10.2006. HOWEVER IT IS SEEN THAT THE ASSESSEE HAS NOT FURNISHED THE INFORMATION CALLED FOR IN THIS REGARD. SINCE THE AMOUNTS W ERE CREDITED INTO THE ASSESSEES BOOKS OF ACCOUNT, THE ONUS TO PROVE THE GENUINENESS OF THE TRANSACTIONS DID REST ON THE ASSESSEE AND THE ASSESSEE HAS FAILED TO DISCHARGE THE ONUS. IN THE CIRCUMSTANCES, THE UNDERSIGNED IS LEFT WITH NO OTHER ALTERNATIVES B UT TO TREAT THE SAID AMOUNTS AS UNEXPLAINED. ACCORDINGLY A SUM OF RS.1,05,000/ - (RS.37,000/ - (+)RS.33,000/ - (+) RS.35,000/ - ) IS TREATED AS THE ASSESSEES INCOME OF THE YEAR U/S.68 OF THE INCOME TAX ACT, 1961. 4.5 THE FACTS AND CIRCUMSTANCES OF THE CASE C LEARLY ESTABLISH THAT THE AMOUNTS CREDITED AGAINST THE NAME OF SHRI YATIN KAMDAR AND IN FACT IN THE NAME OF THREE OTHER PERSONS MENTIONED ABOVE IS NOTHING BUT THE ASSESSEES OWN UNACCOUNTED MONEY WHICH SHE HAS INTRODUCED INTO HER BOOKS OF ACCOUNT IN THE NA ME OF SHRI YATIN KAMDAR AND OTHER THREE PERSONS MENTIONED ABOVE. 4 ITA 1 15 /201 1 WHEN THE ASSESSEE FAILED TO SUBSTANTIATE THE SOURCE OF THESE CREDIT ENTRIES, SHE HAS COME OUT WITH THE THEORY OF RECEIPTS OF ADVANCE MONEY FROM SHRI YATIN KAMDAR. HOWEVER NO CREDENCE CAN BE A TTACHED TO THE ASSESSEES CONTENTION IN THE ABSENCE OF ANY DOCUMENTARY PROOF. IN VIEW OF THE ABOVE, I HOLD THE AMOUNT OF RS.50,000/ - IN THE NAME OF SHRI YATIN KAMDAR AS UNEXPLAINED. ACCORDINGLY A SUM OF RS.50,000/ - IS TREATED AS THE ASSESSEES INCOME OF THE YEAR U/S.68 OF THE IT ACT, 1961. 4. ON APPEAL, THE LD. CIT (A) HAS PASSED THE FOLLOWING ORDER: - 6. AFTER A COMPARATIVE STUDY OF ASSESSMENT ORDER AND ABOVE WRITTEN SUBMISSIONS, I AM INCLINED TO AGREE WITH THE ASSESSMENT ORDER PASSED BY THE LD. ASSE SSING OFFICER BECAUSE THE ASSESSMENT ORDER IS HUNKY - DORY IN ALL RESPECT. 5. WE HAVE HEARD BOTH THE PARTIES. THE ORDER PASSED BY THE CIT (A) IS A CRYPTIC AND NON - SPEAKING ORDER. HIS ORDER IS THEREFORE SET ASIDE AND THE MATTER IS RESTORED TO HIS FILE FOR P ASSING A FRESH ORDER IN CONFORMITY WITH LAW. HE IS REQUESTED TO DISPOSE OF ALL THE GROUNDS OF APPEAL TAKEN BEFORE HIM BY A SPEAKING ORDER. APPEAL FILED BY THE ASSESSEE IS TREATED AS ALLOWED FOR STATISTICAL PURPOSES. R T 21 .0 6 . 201 3 R ORDER PRONOUNCED ON 21 .0 6 . 2013 SD/ - SD/ - ( 0 . . 3 / T. K. SHARMA) ( . . A / D. K. SRIVASTAVA) S. A / JUDICIAL MEMBER 2013 / ACCOUNTANT MEMBER /RAJKOT : 21 .0 6 . 2013 NVA/ - 0 RJO O / COPY OF ORDER FORWARDED TO: - 1 . /APPELLANT - ZARNABEN VIBHASHBHAI SHETH,SANJAY AND COMPANY, PREMJEES, FIRST FLOOR, RAJPUT PARA MAINROAD, RAJKOT 2 . /RESPONDENT - THE INCOME - TAX OFFICER, WARD - 5(1), RAJKOT 3 . N / CONCERNED C IT - I II , RAJKOT 4 . N - / CIT(A) - XX I , AHMEDABAD 5 . .. , 0 , / DR, ITAT, RAJKOT 6 . 3 / GUARD FILE / BY ORDER TRUE COPY SENIOR PRIVATE SECRETARY, ITAT, RAJKOT