ITO 9(1)(2), MUMBAI V. SUNDARA RAMAMURTY KULLARI, MUMBAI

ITA 1179/MUM/2012

• Counselvise Citation: 117919914 RSA 2012
• Duration Of Justice: 2 year(s) 6 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-09-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: E
• Next Hearing Date: 17-09-2014
• Assessment Year: 2008-2009
• Appeal Filed On: 21-02-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: NEIL PHILIP
• Keywords: Unexplained cash credit
• Section: 143(3)

Judgement Text

, , INCOME TAX APPELLATE TRIBUNAL,MUMBAI - E BENCH. . . , , BEFORE S/SH.I.P.BANSAL, JUDICIAL MEMBE R & RAJENDRA,ACCOUNTANT MEMBER /. ITA NO.1179/MUM/2012, ! ! ! ! / ASSESSMENT YEAR-2008-09 IT O 9(1) (2) , R.NO.226, AAYAKAR BHAVAN, M.K.ROAD, MUMBAI-400020 VS. SUNDARA RAMAMURTY KULLAR I, C-401, EDEN-IV, HIRANANDANI GARDENS, POWAI,MUMBAI-400076 # # # #. .. . . .. . . .. . /PAN:AAHPK0087E ( #% / APPELLANT) ( &'#% / RESPONDENT) ( ) / REVENUE BY : SHRI NEIL PHILIP *+ *+ *+ *+ ) ) ) ) / ASSESSEE BY : NONE ( (( ( +, +, +, +, / DATE OF HEARING : 17-09-2014 -.! ( +, / DATE OF PRONOUNCEMENT : 17-09-2014 , 1961 ( (( ( 254 254 254 254( (( (1 11 1) )) ) +5+ +5+ +5+ +5+ 6 6 6 6 ORDER U/S.254(1)OF THE INCOME-TAX ACT,1961(ACT) PER RAJENDRA,AM : CHALLENGING THE ORDER DT.22.12.2011 OF THE CIT(A)-1 9,MUMBAI, ASSESSING OFFICER (AO) HAS RAISED FOLLOWING GROUNDS OF APPEAL: 1.'WHETHER ON THE FACT AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) ERRED IN HOLDING THE SOURCE OF INVESTMENT TO THE EXTENT OF R S. 16,20,000/- IN TO THE IMMOVABLE PROPERTY AS EXPLAINED.' 2. 'THE APPELLANT PRAYS THAT THE ORDER OF THE CIT(A ) ON THE GROUND BE SET ASIDE AND THAT OF THE ASSESSING OFFICER BE RESTORED'. 3.'THE APPELLANT CRAVES LEAVE TO AMEND OR ALTER ANY GROUND OR ADD A NEW GROUND WHICH MAY BE NECESSARY. 2. ASSESSEE,AN INDIVIDUAL,FILED HIS RETURN OF INCOME O N 14.10.2008 DECLARING TOTAL INCOME OF RS. 6, 05,479/-.THE AO COMPLETED THE ASSESSMENT 143(3) OF THE ACT,ON 23.12.2010,DETERMINING INCOME OF THE ASSESSEE AT RS.31.75.LAKHS.THE AO RECEIVED A IR INFORMATION ABOUT THE SALE OF PROPERTY BY THE ASSESSEE.HE MADE CERTAIN ENQUIRES IN THIS REGAR D AND DIRECTED THE ASSESSEE TO PRODUCE PASS- BOOK AND OTHER DOCUMENTS.THE ASSESSEE,VIDE HIS LETT ER DATED 22.07.2010,STATED THAT THERE WAS NO PURCHASE AND SALE OF IMMOVABLE PROPERTY DURING THE YEAR UNDER APPEAL.THE AO ASKED HIM TO EXPLAIN THE DISCREPANCY IN THE STATEMENT MADE BY HI M VIS--VIS AIR INFORMATION RECEIVED ON ACCOUNT OF SALE OF IMMOVABLE PROPERTY OF RS.30.72 L AKHS.AS PER THE AO, THE ASSESSEE SUBMITTED A COPY OF AGREEMENT FOR PURCHASE OF IMMOVABLE PROPERT Y OF RS. 20.70 LAKHS,BUT HE DID NOT EXPLAIN THE ENTRIES APPEARING IN THE BANK ACCOUNT.HE HELD T HAT THE SOURCE OF INVESTMENT OF PURCHASE OF IMMOVABLE PROPERTY REMAIN UNEXPLAINED.FINALLY, HE M ADE AN ADDITION OF RS. 20.70 LAKHS AS UNEXPLAINED CASH CREDIT U/S.68 OF THE ACT. 3. AGGRIEVED BY THE ORDER OF THE AO, THE ASSESSEE PREF ERRED AN APPEAL BEFORE THE FIRST APPELLATE AUTHORITY (FAA).IT WAS STATED BEFORE HIM THAT THE A SSESSEE HAD BOOKED THE PROPERTY IN THE YEAR 2005 AND HAD MADE PAYMENT IN THE EARLIER YEARS EXCE PT RS. 4.97 LAKHS,THAT THE REGISTRATION OF PROPERTY HAD TAKEN PLACE IN THE YEAR UNDER CONSIDER ATION, THAT THE ENTIRE INVESTMENT COULD NOT BE TREATED AS INVESTMENT MADE IN THE YEAR UNDER APPEAL , THAT ASSESSEE HAD NOT PURCHASED ANY PROPERTY AS ALLEGED BY THE AO,THAT THE SOURCE OF EACH DEPOSI TS,APPEARING IN THE BANK PASSBOOK,WAS EXPLAIN -ED TO THE AO. AFTER CONSIDERING THE ASSESSMENT ORDER AND THE SUBM ISSION MADE BY THE ASSESSEE,THE FAA HELD 2 ITA NO.1179/M/2012 SUNDARA RAMAMURTY KULLARI THAT THE COPY OF AGREEMENT FOR PURCHASING THE PROPE RTY ALONG WITH THE BANK PASSBOOK WAS SUBMITTED TO THE AO,THAT ASSESSEE HAD PURCHASED IMM OVABLE PROPERTY, THAT THE BANK ACCOUNT THERE WERE THREE MAJOR ENTRIES DURING THE YEAR I.E. RS. 1 .5 LAKHS AND RS. 4 LAKHS ON 19.07.2007 AND RS. 2.02 LAKHS ON 14.01.2008, THAT THERE WAS NO DEPOSIT OF RS. 20.73 LAKHS DURING THE YEAR UNDER CONSIDERATION IN THE BANK ACCOUNT OF THE ASSESSEE, THAT THE RECEIPT OF RS. 2.02 LAKHS WAS OF THE MATURITY AMOUNT OF AN OLD FD,THAT IT WAS EXPLAINED TO THE AO THAT PAYMENT OF RS. 1.5 LAKHS AND RS.4 LAKHS ON 19.07.2007 WAS RECEIVED BY THE ASSESS EE FROM HIS CURRENT ACCOUNT OF THE ASSESSEE'S PROPRIETARY BUSINESS.CONSIDERING THE ABOVE, THE FAA HELD THAT AO HAD NOT EXAMINED THE ENTRIES ABOUT RS.5.5 LAKHS(RS.1.5 LAKHS + RS. 4 LAKHS),THAT THE SOURCE OF THE SAID AMOUNT WAS EXPLAINED BY THE ASSESSEE DURING THE APPELLATE PROCEEDINGS.TH EREFORE, HE DIRECTED THE AO TO VERIFY THE ENTRIES ABOUT THOSE TWO CHEQUES.FINALLY, HE HELD TH AT THERE WAS NO CASE FOR MAKING AN ADDITION OF RS. 20.07 LAKHS.THE GROUND OF APPEAL TAKEN BY THE A SSESSEE WAS ALLOWED BY THE FAA,SUBJECT TO THE VERIFICATION TO BE MADE BY THE AO. 4. DURING THE COURSE OF HEARING, DEPARTMENTAL REPRESEN TATIVE (DR) LEFT THE ISSUE TO BE DECIDED BY THE BENCH.NOBODY APPEARED ON BEHALF OF THE ASSESSEE .WE HAVE PERUSED THE MATERIAL AVAILABLE ON THE RECORD.WE FIND THAT ASSESSEE HAD NOT SOLD ANY P ROPERTY DURING THE YEAR UNDER CONSIDERATION, THAT TO THAT EXTENT INFORMATION OF AIR WAS FACTUALL Y INCORRECT, THAT ASSESSEE HAD NOT MADE PAYMENT OF RS.20.70 LAKHS DURING THE YEAR UNDER APPEAL, THA T FAA HAD FOUND THAT THERE WERE ONLY THREE MAJOR BANK ACCOUNT ENTRIES IN THE PASSBOOK OF THE A SSESSEE THAT WERE RELEVANT FOR THE YEAR UNDER CONSIDERATION,THAT FAA HAD DIRECTED THE AO TO MAKE PROPER VERIFICATION ABOUT RS.5.5 LAKHS (RS.1.5LAKHS +RS.4 LAKHS)FOR WHICH THE EXPLANATION WAS FILED BY THE ASSESSEE FOR THE FIRST TIME BEFORE THE FAA,THAT RS. 2.2 LAKHS WERE RECEIVED BY THE ASSESSEE ON MATURITY OF HIS OLD FD. IN THESE CIRCUMSTANCES, WE ARE OF THE OPINION THAT ADD ITION MADE BY THE AO FOR RS. 20.70 LAKHS WAS WITHOUT ANY BASIS AND NOT AS PER LAW.WE ALSO FIND T HAT FAA HAD DIRECTED THE AO TO MAKE FURTHER VERIFICATION.IN THESE CIRCUMSTANCES, IN OUR OPINION ORDER PASSED BY THE FAA DOES NOT SUFFER FROM ANY LEGAL INFIRMITY.THEREFORE,CONFIRMING HIS ORDER, WE DECIDE THE EFFECTIVE GROUND OF APPEAL AGAINST THE AO. AS A RESULT, APPEAL FILED BY THE AO STANDS DISMISSED. 7+8 *+ , 9 : ( 5 ; ( + <= . ORDER PRONOUNC ED IN THE OPEN COURT ON 17 TH ,SEPTEMBER2014 . 6 ( -.! > ? 17 + , 201 4 . ( 5 @ SD/- SD/- ( . . / I.P. BANSAL) ( / RAJENDRA) / JUDICIAL MEMBER /ACCOUNTANT MEMBER / MUMBAI, ? /DATE: 17.09 . 2014. 6 6 6 6 ( (( ( &+A &+A &+A &+A BA!+ BA!+ BA!+ BA!+ / COPY OF THE ORDER FORWARDED TO : 1. ASSESSEE / #% 2. RESPONDENT / &'#% 3. THE CONCERNED CIT(A)/ C D , 4. THE CONCERNED CIT / C D 5. DR E BENCH, ITAT, MUMBAI / AE5 &+ , , . . . 6. GUARD FILE/ 5 7 'A+ 'A+ 'A+ 'A+ &+ &+&+ &+ //TRUE COPY// 6 / BY ORDER, F / < DY./ASST. REGISTRAR , /ITAT, MUMBAI