Sri. B.K. Rajanna, Bangalore V. ITO, Bangalore

ITA 1209/BANG/2011

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 63846 (ITAT-BANGALORE)
• Duration Of Justice: 1 year(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-12-2012
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 12-12-2012
• Assessment Year: 2005-2006
• Appeal Filed On: 05-12-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Unexplained cash credit; Business income
• Section: 143(3); 148; 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, BANGALORE BENCH C BEFORE SHRI N BARATHVAJA SANKAR, VICE RESIDENT AND SMT. P MADHAVI DEVI, JUDICIAL MEMBER ITA NO.1209/BA NG/2011 (ASST. YEAR - 2005-06) SHRI B.K RAJANNA, # 758, 80 FEET ROAD, 6 TH BLOCK, RAJAJINAGAR, BANGALORE-560 010. . APPELLANT PAN NO.ABYPR 8863M.. VS. THE INCOME-TAX OFFICER, WARD-9(2), BANGALORE. . RESPONDENT APPELLANT BY : SHRI RAJ GURU, C.A RESPONDENT BY : SHRI A SUNDARARAJAN, JT. CIT DATE OF HEARING : 12-12-2012 DATE OF PRONOUNCEMENT : 12-12-2012 O R D E R PER P MADHAVI DEVI, JUDICIAL MEMBER THIS APPEAL IS FILED BY THE ASSESSEE. THE RELEVANT ASSESSMENT YEAR IS 2005-06. THE APPEAL IS DIRECTED AGAINST TH E ORDER OF THE COMMISSIONER OF INCOME-TAX (APPEALS) V AT BANGALO RE DATED ITA NO.1209/B/11 2 25.10.2011. THE APPEAL ARISES OUT OF THE ASSESSMEN T COMPLETED U/S 143(3) R.W.S 147 OF THE INCOME-TAX ACT, 1961 2. IN THIS APPEAL, THE ASSESSEE IS AGGRIEVED BY THE ORDER OF THE CIT(A) IN CONFIRMING THE ADDITION OF RS.61,44,550/- MADE BY THE AO ON ACCOUNT OF UNEXPLAINED SOURCES FOR THE CASH DEPO SITS INTO THE BANK ACCOUNT OF THE ASSESEE. 3. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSE E WHO IS AN INDIVIDUAL FILED HIS RETURN OF INCOME FOR THE ASSES SMENT YEAR 2005-06 DECLARING TOTAL INCOME OF RS.2,23,460/- WHICH COMPR ISES OF INCOME FROM HOUSE PROPERTY AND BUSINESS INCOME. THE SAME WAS PROCESSED U/S 143(1). THEREAFTER THE ASSESSMENT WAS REOPENED U/S 147 OF THE INCOME-TAX ACT, AS IT HAD COME TO THE NOTICE OF THE AO THAT THE ASSESSEE HAS DEPOSITED CASH TO THE TUNE OF 61,44,55 0/- DURING THE FINANCIAL YEAR 2004-05 IN S.B ACCOUNT NO.0119000741 7 OF STATE BANK OF MYSORE, BANGALORE. ON VERIFICATION OF THE BANK PASS BOOK, IT WAS FOUND THAT THE ASSESSEE HAS DEPOSITED THE SAID AMOUNT DURING THE RELEVANT FINANCIAL YEAR. THEREFORE, THE CASE WAS R EOPENED BY ISSUANCE OF NOTICE U/S 148 OF THE INCOME-TAX ACT. IN SPITE OF SEVERAL NOTICES ISSUED TO THE ASSESSEE, HE DID NOT RESPOND AND, THE REFORE, THE AO ITA NO.1209/B/11 3 COMPLETED THE ASSESSMENT U/S 144 BY MAKING THE ADDI TION OF RS.61,44,550/- AS UNEXPLAINED CASH CREDITS. 4. AGGRIEVED, THE ASSESSEE PREFERRED AN APPEAL BEFO RE THE CIT(A) STATING THAT THESE DEPOSITS ARE OUT OF THE SALE PRO CEEDS OF THE SISTER CONCERNS AND THAT THE ASSESSEE WAS ALSO LOOKING AFT ER THE BUSINESSES OF THE SISTER CONCERNS BELONGING TO HIS CLOSE RELATIVE S DUE TO WHICH, THE SAID DEPOSITS WAS MADE IN HIS ACCOUNT IN ORDER TO F ACILITATE HIM TO MAKE THE PURCHASES OF MATERIAL ON THEIR BEHALF. TH E ASSESSEE FIELD THE RELEVANT DETAILS BEFORE THE CIT(A). THE CIT(A) CAL LED FOR THE REMAND REPORT FROM THE AO AND AFTER PERUSAL OF THE REMAND REPORT AND ALSO THE REJOINDER OF THE ASSESSE ON THE SAID REMAND REPORT, CAME TO THE CONCLUSION THAT THE ASSESSEE HAS FAILED TO FILE THE DETAILS OF THE SISTER CONCERNS, WHICH ARE THE SOURCES OF THE DEPOSITS INT O THE ASSESSEES BANK ACCOUNT. THUS HOLDING, THE APPEAL OF THE ASSES SEE WAS DISMISSED. 5. AGGRIEVED, THE ASSESSEE IS IN SECOND APPEAL BEFO RE US. 6. THE LEARNED COUNSEL FOR THE ASSESSEE, SHRI RAJ G URU, WHILE REITERATING THE ASSESSEES SUBMISSIONS BEFORE THE A UTHORITIES BELOW SUBMITTED THAT ALL THE DETAILS INCLUDING THE RETURN S OF INCOME OF THE ITA NO.1209/B/11 4 SISTER CONCERNS AND THEIR COMPUTATION OF INCOME FOR THE RELEVANT FINANCIAL YEAR WAS FILED BEFORE THE CIT(A) BUT THE REMAND REPORT OF THE AO WAS SILENT ON THESE DETAILS. HE SUBMITTED T HAT EVERY DEPOSIT HAS BEEN EXPLAINED ALONG WITH THE SOURCES AND, THER EFORE, THE ADDITION IS NOT JUSTIFIED. 7. THE LEARNED DR, HOWEVER SUPPORTED THE ORDERS OF THE AUTHORITIES BELOW AND SUBMITTED THAT THE ASSESSEE H AD BEEN GIVEN AMPLE OPPORTUNITY OF PROVING ITS CLAIM BUT THE ASSE SSE HAS FAILED TO AVAIL THE SAID OPPORTUNITY AND HAS FAILED TO PROVE THE SOURCES OF CASH DEPOSITS INTO HIS ACCOUNT ALONG WITH THE NECESSITY OF MAKING SUCH DEPOSITS BY THE SISTER CONCERNS. 8. HAVING HEARD BOTH THE PARTIES AND HAVING CONSIDE RED THEIR RIVAL CONTENTIONS, WE FIND THAT THE ONLY ISSUE IS WHETHER THE ASSESSEE IS ABLE TO ESTABLISH AND EXPLAIN THE SOURCES OF CASH DEPOSI TS INTO HIS ACCOUNTS. THE ASSESSEE HAS FILED THE DETAILS BEFORE THE AO WI TH REGARD TO THE DEPOSITS AND THE SOURCES THEREOF WHICH ARE PLACED I N THE PAPER BOOK FILED BEFORE US. THE ASSESEE HAS ALSO FILED ADDITI ONAL EVIDENCES, WHICH ARE COPIES OF THE ASSESSMENT ORDERS OF THE SISTER C ONCERNS TO ESTABLISH THAT THEIR TURNOVER WAS MUCH MORE THAN THESE DEPOSI TS AND THAT THE ITA NO.1209/B/11 5 SOURCES ARE THUS EXPLAINED. WE ARE OF THE OPINION THAT THESE EVIDENCES NEED VERIFICATION BY THE AO AS THEY GO TO THE VERY ROOT OF THE MATTER. THEREFORE, IN THE INTEREST OF JUSTICE, WE DEEM IT F IT AND PROPER TO ADMIT THE SAME AND REMIT THE ISSUE TO THE FILE OF THE ASS ESSING OFFICER TO EXAMINE THE ISSUE IN ACCORDANCE WITH THE SAID EVIDE NCE. IT IS MADE CLEAR THAT IF THE ASSESSEE IS ABLE TO PROVE THAT TH E DEPOSITS INTO HIS ACCOUNTS ARE OUT OF THE SALE PROCEEDS OF THE SISTER CONCERNS , THEN THE AO IS DIRECTED TO DELETE THE ADDITION. IT IS NOT N ECESSARY TO PROVE THE NECESSITY OF MAKING SUCH DEPOSITS. NEEDLESS TO MEN TION THAT THE ASSESSEE SHALL BE GIVEN A FAIR OPPORTUNITY OF HEARI NG. 9. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 12 TH DEC, 2012. SD/- SD/- (N BARAT HVAJA SANKAR) (P MADHAVI DEVI) VICE PRESIDENT JUDICIAL MEMBER VMS. BANGALORE DATED : 12/12/2012 ITA NO.1209/B/11 6 COPY TO : 1. THE ASSESSEE 2. THE REVENUE 3.THE CIT CONCERNED. 4.THE CIT(A) CONCERNED. 5.DR 6.GF BY ORDER SR. PRIVATE SECRETA RY, ITAT, BANGALORE.