ITO, Ward- 10(1), Hyderabad V. Smt. Shashikala Gupta, Secunderabad

ITA 1152/HYD/2012

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 66440 (ITAT-HYDERABAD)
• Duration Of Justice: 3 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-11-2012
• Appeal Filed By: Department
• Order Result: Partly Allowed
• Bench Allotted: B
• Assessment Year: 2009-2010
• Appeal Filed On: 01-08-2012
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: VIDISHA KALRA
• Assessee Lawyers: LAXMINIWAS SHAR MA

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH B', HYDERABAD BEFORE SHRI CHANDRA POOJARI, ACCOUNTANT MEMBER AND SHRI SAKTIJIT DEY, JUDICIAL MEMBER ITA NO.1152/HYD/2012 : ASSESSM ENT YEAR 2009-10 INCOME TAX OFFICER, WARD-10(1), HYDERABAD V/S. SMT. SHASHIKALA GUPTA, HYDERABAD ( PAN - AASPG 1838 N) (APPELLANT) (RESPONDENT) APPELLANT BY : SMT. VIDISHA KALRA, DR RESPONDENT BY : SHRI LAXMI NIWAS SHARMA DATE OF HEARING 7.11.2012 DATE OF PRONOUNCEMENT 16.11.2012 O R D E R PER SAKTIJIT DEY, JUDICIAL MEMBER: THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST THE O RDER OF THE COMMISSIONER OF INCOME-TAX(APPEALS)-VI, HYDERABAD DATED 25.5.2012, FOR THE ASSESSMENT YEAR 2009-10. 2. THOUGH THE REVENUE HAS RAISED AS MANY AS TEN GROUND S IN THIS APPEAL, EFFECTIVE GRIEVANCE OF THE REVENUE IS THAT HE CIT(A) HAS ERRED IN DELETING AN ADDITION OF RS.76,05,000 MADE BY THE ASSE SSING OFFICER ON ACCOUNT OF UNEXPLAINED CASH DEPOSITS. 3. BRIEFLY STATED, FACTS OF THE CASE ARE THAT THE ASSESSEE IS AN INDIVIDUAL, DERIVING INCOME FROM HOUSE PROPERTY AND O THER SOURCES. FOR THE ITA NO.1152/HYD/2012 SMT SHASHIKALA GUPTA, HYDERABAD 2 ASSESSMENT YEAR 2009-10, SHE FILED HER RETURN OF INCOME O N 30.7.2009 DECLARING TOTAL INCOME OF RS.3,73,997. THOUGH THE RE TURN WAS INITIALLY PROCESSED UNDER S.143(1) OF THE ACT, THE CASE WAS SELECTED F OR SCRUTINY. IN THE SCRUTINY ASSESSMENT THAT ENSUED, THE ASSESSING OFFICER NOT ICED THAT THE ASSESSEE HAD MADE DEPOSITS OF RS.83,47,243 IN HER ACCOUNT W ITH AXIS BANK. WHEN ASKED TO EXPLAIN, THE ASSESSEE, BESIDES FURNISHING SOUR CES FOR THE DEPOSITS MADE ON VARIOUS DATES ALONGWITH THE RELEVANT W ITHDRAWALS MADE FROM THE BANK ACCOUNT, EXPLAINED BEFORE THE ASSESSING OFF ICER AS FOLLOWS- MR.VIJAY KUMAR GUTPA IS MY HUSBAND AND SINCE HE IS IN NEED OF MONEY, I HAVE GIVEN HIM RS.45,25,000/- ON VARIOUS D ATES DURING THE FY 2008-09 FOR SHORT DURATION THROUGH ACCOUNT PAYEE CHEQUES AND DURING THE YEAR HE REPAID ME A SUM OF RS.38,00,000/ - THROUGH ACCOUNT PAYEE CHEQUES ON VARIOUS DATES. I HAVE NOT CHARGED ANY INTEREST FROM HIM. I HAVE WITHDRAWN CASH FROM MY BANK ACCOUNT O N VARIOUS DATES AND KEPT THE MONEY IN MY HOUSE ONLY. I HAVE NO BEL IEF IN BANKING SYSTEM SINCE SO MANY BANKS LIKE PRUDENTIAL CO-OPERA TIVE BANK AND CHARMINAR COOPERATIVE BANK, VASAVI COOPERATIVE BANK AND MANY OTHER BANKS HAVE RUN INTO PROBLEMS AND CLOSED. SINCE AS P ER INCOME-TAX ACT, 1961, ANY AMOUNT IN EXCESS OF RS.20,000 IS TO BE PA ID THROUGH ACCOUNT PAYEE CHEQUE ONLY, I HAVE DEPOSITED THE CASH IN THE BANK BEFORE GIVING THE CHEQUES TO MY HUSBAND. AFTER RECEIVING T HE REPAYMENT FROM HIM, I HAVE WITHDRAWN THE MONEY AND KEPT THE SAME IN HOUSE ONLY . 4. EXAMINING THE ABOVE EXPLANATION OF THE ASSESSEE, TH E ASSESSING OFFICER OBSERVED THAT THE BANKING SYSTEM IS A VERY FASTE ST GROWING SECTOR IN INDIA AND THE BANKS ARE PROVIDING GOOD CUSTOMERS SERVICES, WITH NUMBER OF BANK BRANCHES AND ATM CENTRES, NET BANKING FACILITY, D EMAT ACCOUNT, ONLINE BILLS PAYMENT FACILITY, BESIDES OFFERING GOOD INTEREST R ATES ON VARIOUS TYPES OF FIXED DEPOSITS. THE EXAMPLES OF CLOSED BANKS GIVEN BY TH E ASSESSEE HAPPEN TO BE VERY OLD, AND THE INDIAN BANKING INDUSTRY NOW IS CONSIDERED TO BE VERY STABLE, WITH THE BANKS HAVING HEALTHY BALANCE SHEET AND LOW EXPOSURE TO RISKY ASSETS. HE NOTED THAT EVEN THE GLOBAL FINANCIAL C RISIS DID NOT AFFECT THE INDIAN BANKS. THE ASSESSING OFFICER FURTHER OBSERVED THAT NOTWITHSTANDING THE STATEMENT OF THE ASSESSEE THAT SHE HAS NO BELIEF IN BA NKING SYSTEM, THE ITA NO.1152/HYD/2012 SMT SHASHIKALA GUPTA, HYDERABAD 3 ASSESSEE HAS BEEN USING THE BANKING FACILITIES, IN GIVING M ONEY TO HER HUSBAND, IN PAYING MUNICIPAL TAX, ETC. THROUGH THE C HEQUES AND IN RECEIVING THE INTEREST ON NSC MATURITY ETC. HE FURTHER OBSERVED, THAT THE CRIME IS AT ITS PEAK NOW A DAYS, AND NO BODY IS THEREFORE, PREFERR ING TO KEEP HUGE AMOUNT OF MONEY AT HOME, AND PEOPLE ARE PREFERRING TO INVEST THE MONEY OR DEPOSIT IT IN BANK TO GET SOME GOOD INTEREST. HE FURTH ER NOTED THAT THE ASSESSEE IS HAVING ACCOUNT IN AXIS BANK, WHICH IS HAVING VE RY WIDE NETWORK OF MORE THAN 1281 BRANCHES, INCLUDING 169 SERVICE BRANCH ES/CPSS AS ON 31.3.2011. THE SAID BANK ALSO MAINTAINS LARGE ATM NET WORK. AS PER THE FINANCIAL STATEMENT OF M/S. VIJAY TEXTILES LTD., WHER EIN THE HUSBAND OF THE ASSESSEE IS THE CMD, THE ASSESSING OFFICER NOTED, FOR THE FI NANCIAL YEAR 2008- 09, THE BANKERS OF THE COMPANY ARE AXIS BANK AND ALSO THE COMPANY OBTAINED HUGE SECURED LOANS FROM AXIS BANK. WITH THESE OBSERVATIONS, THE ASSESSING OFFICER REJECTED THE EXPLANATION OF THE ASSESSEE, A ND TREATED CASH DEPOSITS AGGREGATING TO RS.76,05,000 AS THE UNEXPLAINED INCOME OF THE ASSESSEE. WITH THIS ADDITION, THE ASSESSING OFFICER COMPLET ED THE ASSESSMENT ON A TOTAL INCOME OF RS.79,78,997, VIDE ORDER OF ASSESSME NT DATED 25.11.2011, PASSED UNDER S.143(3) READ WITH S.147 OF THE ACT. 5. AGGRIEVED BY THE ABOVE ADDITION, ASSESSEE PREFERRED APPEAL BEFORE THE CIT(A). THE CIT(A), ON GOING THROUGH TH E SOURCES FURNISHED BY THE ASSESSEE FOR THE DEPOSITS MADE INTO THE BANK ACCOUNT, O N VARIOUS DATES, FOUND THAT THE ASSESSEE HAS CLAIMED THAT A SUM OF RS.38,00, 000 OUT OF THE TOTAL SUM OF RS.76,05,000 HAD BEEN RECEIVED FROM SHR I VIJAY KUMAR GUPTA, HER HUSBAND, THROUGH ACCOUNT PAYEE CHEQUES. OBSERVING TH AT THE ASSESSING OFFICER HAS NOT REBUTTED THIS CLAIM, THE CIT(A) HELD T HAT THE ASSESSEES CLAIM TO THIS EXTENT HAS TO BE ALLOWED. EVEN AS FOR THE BA LANCE SUM ALSO, THE CIT(A) ACCEPTED THE CLAIM OF THE ASSESSEE IN THE FOLLOWIN G MANNER- ITA NO.1152/HYD/2012 SMT SHASHIKALA GUPTA, HYDERABAD 4 3.4 FOR THE BALANCE SUM, THE ASSESSEE HAS SUBMITT ED THAT THESE DEPOSITS WERE MADE OUT OF PREVIOUS WITHDRAWALS FROM THE SAME BANK ACCOUNT. SHE HAS ALSO RELIED ON THE FOLLOWING DECIS IONS IN HER FAVOUR- (1) DELHI BENCH OF ITAT IN SANJEEV KAPOOR CASE : ITA 2091/DEL./2010 DT. 29.10.2010 (2) ITAT 205 TAXATION 58 RASIDA BANO, BASIRAN AND MOHD. ASLAM V/S. ACIT (3) BALDEV CHARLA 121 TTJ 366 ITAT (4) ITO WRD-31(1) NEW DELHI V/S. SH. BHUPENDER PAL SING H CHAWLA AY 2005-06 ITAT :A BENCH DELHI ITA NO.4080/DEL./20 10 DT.25.02.2011. 3.5 THERE IS NO DOUBT THAT THE BEHAVIOR OF THE ASSE SSEE IN MAKING CASH WITHDRAWALS FOR APPARENTLY NO PURPOSE IS EXTREMELY SUSPICIOUS AND ABNORMAL. THERE IS ABSOLUTELY NO REASON FOR THE ASS ESSEE TO MAKE SUCH WITHDRAWALS WHEN SHE IS NOT A STRANGER TO BANKING T RANSACTIONS. HOWEVER, THE ONLY FACTORS IN HER FAVOUR ARE THE IDENTICAL PR ECEDING WITHDRAWALS AND THE ABSENCE OF ANY EVIDENCE TO SHOW THAT THESE WITHDRAW ALS WERE USED FOR SOME PURPOSE OTHER THAN WHAT IS CLAIMED BY THE ASSESSEE. THEREFORE, I HAVE NO OPTION BUT TO GRANT RELIEF TO THE ASSESSEE FOR THE BALANCE SUM OF RS.38,05,000. 6. THE CIT(A) THUS, DELETED THE ENTIRE ADDITION OF RS.76,05,000 MADE BY THE ASSESSING OFFICER. 7. AGGRIEVED BY THE RELIEF GRANTED BY THE CIT(A), REV ENUE PREFERRED THE PRESENT APPEAL BEFORE WE US. 8. THE LEARNED DEPARTMENTAL REPRESENTATIVE SUBMITTE D THAT THE ASSESSEE HAVING NOT FURNISHED PROPER EXPLANATION, WITH R EGARD TO HOLDING SO MUCH AMOUNT IN CASH, THE ADDITION MADE BY THE ASSESSING O FFICER WAS JUSTIFIED. THE LEARNED DEPARTMENTAL REPRESENTATIVE FU RTHER SUBMITTED THAT THE CIT(A) HAVING HERSELF EXPRESSED DOUBT WITH REGARD TO T HE ASSESSEES INTENTION BEHIND MAKING SUCH HUGE AMOUNTS OF CASH WITHDRAWALS, THE RE WAS NO JUSTIFICATION ON HER PART TO ACCEPT THE CLAIM OF THE ASSESS EE AND DELETE THE ADDITION. ITA NO.1152/HYD/2012 SMT SHASHIKALA GUPTA, HYDERABAD 5 9. THE LEARNED AUTHORISED REPRESENTATIVE FOR THE ASSE SSEE SUBMITTED THAT THE ASSESSEE HAS PROPERLY EXPLAINED THE SOU RCE OF SUCH DEPOSITS THROUGH HER BANK ACCOUNT, AND THEREFORE, THE C IT(A) WAS JUSTIFIED IN DELETING THE ADDITION. THE LEARNED AUTHORISED REPRE SENTATIVE FOR THE ASSESSEE SUBMITTED THAT THE ASSESSING OFFICER HAS NOT DISPUT ED THE FACT THAT AN AMOUNT OF RS.38 LAKHS WAS RECEIVED BY WAY OF ACCOUNT PAYEE CHEQUES FROM HER HUSBAND, SHRI VIJAY KUMAR GUPTA, AND THE BA LANCE AMOUNT OF RS.38,05,000 WAS DEPOSITED WITHIN A GAP OF SHORT PERIOD , FROM EARLIER CASH WITHDRAWALS MADE. IN THE AFORESAID CIRCUMSTANCES, THE CI T(A) WAS JUSTIFIED IN DELETING THE ADDITION. 10. WE HEARD BOTH SIDES AND PERUSED THE MATERIAL AV AILABLE ON RECORD. AS IS EVIDENT FROM THE RECORD, WHILE EXPLAINI NG THE SOURCES FOR THE DEPOSITS, THE ASSESSEE HAS SUBMITTED BEFORE THE ASSESSING OFFI CER THAT SHE HAD ADVANCED AN AMOUNT OF RS.45,25,000 ON VARIOUS DATE S DURING THE FINANCIAL YEAR 2008-09. IT WAS FURTHER EXPLAINED THA T THE ASSESSEE WAS HOLDING THESE AMOUNTS IN CASH, AS SHE WAS NOT HAVING FAIT H IN THE BANKING SYSTEM. WHEN HER HUSBAND NEEDED THE MONEY, KEEPING IN VIEW THE RESTRICTIONS IMPOSED UNDER THE INCOME TAX ACT, SHE HAS DEPO SITED MONEY IN BANK ACCOUNT, AND ISSUED CHEQUES TO HER HUSBAND. IT WAS F URTHER STATED BY HER THAT AFTER RECEIVING BACK THE MONIES FROM HER HUSB AND BY WAY OF ACCOUNT PAYEE CHEQUE, THE SAME WAS AGAIN DEPOSITED INTO THE BAN K ACCOUNT, AND WITHDRAWALS WERE MADE SOON AFTER, STATED TO BE, FOR H OLDING THE SAME IN CASH AT HOME. HOWEVER, IT IS SEEN FROM THE STATEMENT OF DEP OSITS/WITHDRAWALS FURNISHED BY THE AUTHORISED REPRESENTATIVE FOR THE ASSE SSEE BEFORE THE ASSESSING OFFICER, WHICH HAS BEEN EXTRACTED ON PAGE 2 OF TH E ASSESSMENT ORDER, THAT IMMEDIATELY AFTER DEPOSITS WERE MADE IN THE BANK ACCOUNT, THE SAME AMOUNT IS WITHDRAWN, AND AGAIN IT IS REDEPOSITED I NTO THE BANK ACCOUNT. ITA NO.1152/HYD/2012 SMT SHASHIKALA GUPTA, HYDERABAD 6 IF THE ASSESSEES STATEMENT THAT SHE DID NOT HAVE FAITH I N THE BANKING SYSTEM, AND THAT IS WHY SHE PREFERRED TO HOLD THE CASH AT HOME IS TO BE BELIEVED, THEN WHAT IS THE PURPOSE AND MOTIVE BEHIND THE REDEPOSITIN G THE AMOUNT AFTER WITHDRAWING THE REPAYMENT OF LOAN MADE BY HER HUSBAN D, IS NOT KNOWN. FACTS ARE ALSO NOT CLEAR WHETHER DEPOSITS OF CASH WITHDRAW ALS WERE AGAIN MADE INTO THE BANK ACCOUNT FOR ADVANCING LOANS TO HER H USBAND. FROM THE ASSESSMENT ORDER AS WELL AS THE ORDER OF THE CIT(A), IT I S QUITE EVIDENT THAT THE MATTER HAS NOT BEEN LOOKED INTO AT DEPTH, NOT ON LY WHILE MAKING THE ADDITION BY THE ASSESSING OFFICER, BUT ALSO WHILE DELETI NG THE SAME BY THE CIT(A). IN THIS VIEW OF THE MATTER, WE ARE OF THE CON SIDERED VIEW THAT THE MATTER REQUIRES TO BE REMITTED BACK TO THE ASSESSING O FFICER FOR FRESH CONSIDERATION, AFTER MAKING NECESSARY ENQUIRIES. 11. AS IT APPEARS FROM THE RECORD, THE ASSESSING OFFICER HAS MADE THE IMPUGNED ADDITION, FINDING THE EXPLANATION OFFERED BY THE ASSESSEE THAT SHE HAS NO FAITH IN THE BANKING SYSTEM AND PREFERS TO HOLD ANY AMOUNT OF MONEY ONLY IN CASH AT HOME, TO BE RIDICULOUS, WHEREAS THE CIT (A), FINDING NO ILLEGALITY IN THE HOLDING OF ANY AMOUNT OF CASH BY TH E ASSESSEE AT HOME AND IN THE ABSENCE OF ANY MATERIAL BROUGHT ON RECORD TO SUGGEST THAT THE EARLIER WITHDRAWN WAS UTILISED FOR SOME OTHER PURPOSE, THE CIT( A) HAS DELETED ADDITION MADE BY THE ASSESSING OFFICER, THOUGH SHE HERSELF EXPRESSED DOUBT ABOUT THE GENUINENESS OF THE EXPLANATION OF THE ASSESSEE. IT MAY BE TRUE THAT THE EXPLANATION OF THE ASSESSEE APPEARS TO BE RIDICU LOUS, CONSIDERING THE CHANGING SOCIAL AND ECONOMIC SCENARIO, WITH THE BANKING B ECOMING A NECESSITY FOR ALMOST ALL CLASSES OF SOCIETY. BUT, WHEN THE A SSESSEE OFFERS AN EXPLANATION, IT HAS TO BE EXAMINED WITH ALL SERIOUSNE SS, AND AT THE SAME TIME, THE ASSESSEE IS REQUIRED TO ESTABLISH THE GENUINENESS OF HER EXPLANATION BY RECONCILING THE DEPOSITS/WITHDRAWALS. WE ACCORDINGLY SET ASIDE THE IMPUGNED ORDER OF THE CIT(A), AND RESTORE THE MATTER TO THE FILE OF THE ITA NO.1152/HYD/2012 SMT SHASHIKALA GUPTA, HYDERABAD 7 ASSESSING OFFICER FOR RE-EXAMINATION OF THE ISSUE IN ACCOR DANCE WITH LAW AND AFTER GIVING REASONABLE OPPORTUNITY OF HEARING TO TH E ASSESSEE. 12. IN THE RESULT, REVENUES APPEAL IS ALLOWED FOR ST ATISTICAL PURPOSES. ORDER PRONOUNCED IN THE COURT ON 16.11.2012 SD/- SD/- (CHANDRA POOJARI) (SAKTIJIT DEY) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED/- 16 TH NOVEMBER, 2012 COPY FORWARDED TO: 1. SMT. SHASHIKALA GUPTA, C/O. M/S. VIJAY TEXTILES,, 104, SURYA TOWERS, S.P. ROAD, SECUNDERABAD 2. 3. 4. INCOME-TAX OFFICER, WARD 10(1), HYDERABAD COMMISSIONER OF INCOME-TAX(APPEALS)-VI, HYDERABAD COMMISSIONER OF INCOME-TAX V, HYDERABAD 5. DEPARTMENTAL REPRESENTATIVE, ITAT, HYDERABAD. B.V.S.