Venkata Nagaraju Dasam , Hyderabad V. Income Tax Officer, Ward-9(4), Hyderabad

ITA 117/Hyd/2019

• Counselvise Citation: [2021] 107 COUNSELVISE.COM (IT) 9922 (ITAT-HYDERABAD)
• Duration Of Justice: 2 year(s) 5 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-07-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB-A
• Assessment Year: 2014-2015
• Appeal Filed On: 31-01-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: VENUDHAR GODESI
• Assessee Lawyers: M BHUPAL GOWD
• Keywords: Principle of natural justice
• Section: 68; 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD A BENCH : HYDERABAD (THROUGH VIDEO CONFERENC E ) BEFORE SMT. P. MADHAVI DEVI, JUDICIAL MEMBER AND SHRI A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER ITA NO. 11 7 /HYD./ 20 19 ASSESSMENT YEAR: 2014 - 15 SRI VENKATA NAGARAJU DASAM VS. ITO, WARD 9 ( 4 ) HYDERABAD HYDERABAD [ PAN: AIBPD4476E ] (APPELLANT) (RESPONDENT) FOR ASSESSEE : SHRI M. BHUPAL GOWD, , C.A. FOR REVENUE : S RI VENUDHAR GODESI , D.R DATE OF HEARING : 1 4 /07/ 202 1 DATE OF PRONOUNCEMENT : 26 / 07 /202 1 O R D E R PER P. MADHAVI DEVI, JM THIS IS ASSESSEES APPEAL FILED AGAINST THE ORDER OF CIT(A) - 7, HYDERABAD DATED 26.11.2018 RELATING TO A.Y. 2014 - 15. 2. BRIEF FACTS OF THE CASE ARE THAT ASSESSEE AN INDIVIDUAL, FILED HIS RETURN OF INCOME FOR THE AY 2014 - 15 ON 21.12.2015 DEC LARING A TOTAL INCOME OF RS. 2,28,400/ - . THE CASE WAS SELECTED FOR LIMITED SCRUTINY UNDER CASS TO VERIFY THE CASH DEPOSITS IN SAVINGS BANK ACCOUNT S AS THEY WERE MORE THAN THE ASSESSEES TURNOVER. THE ASSESSEE DURING THE ASSESSMENT PROCEEDINGS U/S 143 (3) OF THE INCOME TAX ACT, 1961 [IN SHORT THE ACT] WAS ASKED TO FURNISH INFORMATION OF ITS BUSINESS ACTIVITY, COMPUTATION OF INCOME, BANK ACCOUNT ITA NO . 117 /HYD./ 20 19 AY 2014 - 15 SRI VENKATA NAGARAJU DASAM, HYDERABAD 2 STATEMENT AND DETAILS OF DEBIT S AND CREDITS APPEARING IN HIS SAVINGS BANK ACCOUNT. HOWEVER, SINCE THE ASSE SSEE FURNISHED ONLY PART OF THE INFORMATION, THE AO COMPLETED THE ASSESSMENT U/S 144 OF THE ACT AND HAS TREATED THE CASH DEPOSITS INTO CITIZEN CO - OPERATIVE BANK ACCOUNT TO THE EXTENT OF RS. 58,80,000/ - AS INCOME OF THE ASSESSEE UNDER THE HEAD INCOME FROM OTHER SOURCES AND BROUGHT THE SAME TO TAX. 3. AGGRIEVED, ASSESSEE PREFERRED AN APPEAL BEFORE THE CIT(A) WHO CONFIRMED THE ADDITION OF RS.58,80,000/ - MADE BY THE AO AND ASSESSEE IS IN SECOND APPEAL BEFORE US BY RAISING THE FOLLOWING GROUNDS OF APPEAL. 1. AGGRIEVED AGAINST THE ORDER OF THE CIT(APPEALS), HYD - 7, THE APPELLANT IN APPEAL BEFORE THE INCOME TAX APPELLATE TRIBUNAL. 2. THAT THE LEARNED CIT(APPEALS), HYD - 7 HAS GROSSLY ERRED BOTH IN LAW AND ON FACTS BY NOT ALLOWING THE DEPOSITS MADE BY THE APPELLANT IS NOT CHARGEABLE TO TAX AND INCOME OF THE APPELLANT AT RS. 68,77,499 / - AS AGAINST DECLARED INCOME OF RS. 3,36,945/ - IN AN ORDER OF ASSESSMENT DATED 26.11.2018 UNDER SECTION 144 OF THE INCOME TAX ACT. 3. THAT THE LEARNED CIT(APPEALS), HYD - 7 HAS ERRED BOTH IN LAW AND ON FACTS BY ALLOWING AN ADDITION OF RS. 58,80,000/ - REPRESENTING ALLEGED UNEXPLAINED CASH DEPOSITS IN THE CITIZEN CO - OPERATIVE SOCIETY BANK ACCOUNT OF THE APPELLANT AND BROUGHT TO TAX UNDER SECTION 68 OF THE ACT. 4. THAT THE LEARNED CIT ( APPEALS), HYD - 7 HAS FAILED TO APPRECIATE THAT BANK ACCOUNT OF THE APPELLANT DOES NOT CONSTITUTE BOOKS OF ACCOUNT AND THEREFORE EVEN OTHERWISE ADDITION MADE BY INVOKING SECTION 68 OF THE INCOME TAX ACT 1961 IS OTHERWISE MISPLACED, MISCONCEIVED A ND UNTENABLE. 5. THAT WHILE MAKING THE ADDITION THE LEARNED ASSESSING OFFICER HAS FAILED TO APPRECIATE THE EXPLANATION TENDERED BY THE APPELLANT THAT DEPOSITS WERE OUT OF SAVING FROM AGRICULTURAL INCOME OF HIS FAMILY MEMBERS GIVEN TO HIM FOR MEDICAL TREAT MENT OF HIS FATHER AND AS SUCH SUMS COULD NOT BE BROUGHT TO TAX AS INCOME OF THE APPELLANT. 6. THE LEARNED ASSESSING OFFICER HAS FAILED TO CONSIDER THE FACT OF TREATMENT UNDERGONE BY THE APPELLANT'S FATHER FOR CANCER TREATMENT AT VARIOUS HOSPITALS IN AND HRA PRADESH & TELANGANA, IN SPITE OF PROVIDING THE PRESCRIPTIONS, INVESTIGATION REPORTS AND VARIOUS HOSPITAL BILLS. THE APPELLANT FATHER HAS ALSO OBTAINED RELIEF FUND FROM AP CHIEF MINISTER'S RELIEF FUND FOR THE CANCER TREATMENT. ITA NO . 117 /HYD./ 20 19 AY 2014 - 15 SRI VENKATA NAGARAJU DASAM, HYDERABAD 3 7 . THAT THE LEARNED ASSES SING OFFICER HAS FURTHER ERRED BOTH IN LAW AND ON FACTS IN ASSESSING THE ENTIRE CASH DEPOSITS INTO CITIZEN CO - OPERATIVE BANK ACCOUNT AS UNEXPLAINED CASH DEPOSITS WITHOUT GIVING THE BENEFITS OF ADJUSTING THE PAST WITHDRAWALS FROM THE SAME OR ANOTHER BANK A CCOUNT OF THE APPELLANT, WHICH IS AGAINST THE PRINCIPLES OF NATURAL JUSTICE. 8 . THAT THE LEARNED ASSESSING OFFICER HAS ERRED BOTH IN LAW AND ON FACTS IN LEVYING INTEREST OF RS. 3,09,366/ - UNDER SECTION 234A OF THE ACT AND, OF RS.6, 00 ,534/ - UNDER SECTION 234 B OF THE ACT WHICH ARE NOT LEVIABLE ON THE FACTS OF THE INSTANT CASE. 9. TH AT THE APPELLANT CRAVES LEAVE TO ADD OR AMEND ANY GROUNDS OF APPEAL. IT IS THEREFORE, PRAYED THAT, ASSESSMENT FRAMED BE HELD TO BE WITHOUT JURISDICTION AND FURTHER, ADDITION ALONG - WITH INTEREST LEVIED MAY KINDLY BE DELETED AND THE APPEAL OF THE APPELLANT BE ALLOWED. 4 . THE LD.COUNSEL FOR THE ASSESSEE SUBMITTED THAT ASSESSEE AND HIS FAMILY MEMBERS ARE INTO COCONUT BUSINESS AND OWNED 15 ACRES OF LAND IN WHICH COCONUTS ARE GROWN AND SOURCES OF CASH DEPOSITS ARE THE RECEIPTS FROM THE SALE OF THE CROP. HE SUBMITTED THAT ASSESSEES FATHER WAS NOT WELL AND WAS BEING TREATED AND ALL OF HIS FAMILY MEMBERS FROM TIME TO TIME DEPOSITED CASH INTO ASSESSEES BANK ACCOUNT FOR HIS TREATMENT . HE SUBMITTED THAT THE AO HAS NOT ACCEPTED TH IS CONTENTION OF THE ASSESSEE BY HOLDING TH AT ASSESSEES FATHER HAS EXPIRED IN MAY, 2013 WHEREAS ALL DEPOSITS IN THE ACCOUNT ARE THEREAFTER I.E FROM JUNE, 2013. HE SUBMITTED THAT ASSESSEES FATHER HAS EXPIRED ON 09 TH MAY, 2014 AND NOT IN MAY, 2013. HE SUBMITTED THAT ALL THESE FACTS NEED TO BE CONSIDERED BY THE AUTHORITIES BELOW . HE ALSO MADE AN ALTERNATIVE SUBMISSION THAT EVEN IF THE SAID CASH DEPOSITS ARE TO BE TREATED AS BELONGING TO THE ASSESSEE, IT SHOULD BE TREATED AS PART OF TURNOVER OF THE ASSESSEE AND INCOME IS TO BE ESTIMATED THEREO N AS B USINESS INCOME OF THE ASSESSEE. IN VIEW OF THE SAME , HE PRAYED FOR REMITT ANC E OF THE ISSUE BACK TO THE FILE OF AO. 4 .1. LD. DR WAS ALSO HEARD. ITA NO . 117 /HYD./ 20 19 AY 2014 - 15 SRI VENKATA NAGARAJU DASAM, HYDERABAD 4 5 . HAVING REGARD TO THE FACT THAT THE AO HA S PROCEEDED ON THE ASSUMPTION THAT THE CASH DEPOSITS ARE AFTER THE DEATH OF ASSESSEES FATHER, AND THE ASSESSEE COULD NOT FILE ALL THE DETAILS BEFORE THE AO AND THE CIT(A), WE DEEM IT FIT AND PROPER TO REMIT THE ISSUE TO THE FILE OF THE AO WITH A DIRECTIO N THAT AO SHALL RECONSIDER THE ISSUE AFRESH IN LIGHT OF MATERIAL FILED BY THE ASSESSEE IN ACCORDANCE WITH LAW. THE ASSESSEE IS DIRECTED TO COOPERATE WITH THE AO BY GIVING ALL DETAILS , FAILING WHICH , AO CAN TAKE NECESSARY DECISION AS PER LAW. 5. IN THE RESULT, ASSESSEES APPEAL IS TREATED AS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN OPEN COURT ON 26 /07/2021 . SD/ - SD/ - (A. MOHAN ALANKAMONY) (P. MADHAVI DEVI) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 26 TH JULY, 2021 *GMV COPY OF ORDER FORWARDED TO: 1. SRI VENKATA NAGARAJU DASAM, H.NO . 11 - 11 - 112/1, ROAD NO.5, SOWBHAGYAPURAM, KOTHAPETA, HYDERABAD 500 035, TELANGANA . 2. ITO, WARD 9(4), HYDERABAD 3. ACIT, RANGE 9 , HYDERABAD 4. CIT(A) - 7, HYDERABAD 5. PR.C IT 7, HYDERABAD . 6 . D.R. ITAT HYDERABAD 7 . GUARD FILE