Sh. Rajesh Kumar, Ludhiana V. ITO, W-1(2), Ludhiana

ITA 1223/CHANDI/2018

• Counselvise Citation: [2019] 116 COUNSELVISE.COM (IT) 9915 (ITAT-CHANDIGARH)
• Duration Of Justice: 8 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-05-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2014-2015
• Appeal Filed On: 19-09-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MANJIT SINGH
• Keywords: Unexplained cash credit; Opportunity of being heard; Additional evidence; Set aside
• Section: 68

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL, CHANDIGARH BE NCH SMC CHANDIGARH , ! BEFORE: SMT. DIVA SINGH, JM ./ ITA NO. 1223/CHD/2018 / ASSESSMENT YEAR : 2014-15 SHRI RAJESH KUMAR, HOUSE NO. 260, PHASE-1, FOCAL POINT, LUDHIANA. VS THE ITO, WARD 1(2), LUDHIANA. ./PAN NO. : AKOPK4258L /APPELLANT /RESPONDENT /ASSESSEE BY : NONE / REVENUE BY : SHRI MANJIT SINGH, CIT-DR ! ' # /DATE OF HEARING : 14.05.2019 $%&' # /DATE OF PRONOUNCEMENT : 30.05.2019 '#/ ORDER THE PRESENT APPEAL HAS BEEN FILED BY THE ASSESSEE ASSAI LING THE CORRECTNESS OF THE ORDER DATED 16/07/2018 OF CIT(A)-1 LUDHIANA PERTAINING TO 2014 15 ASSESSMENT YEAR ON THE FOLLOWING GROUNDS : 1. THAT ON THE FACTS AND THE CIRCUMSTANCES OF THE CASE , THE ORDER OF LEARNED CIT(A) IS BAD IN LAW. 2. THAT THE WORTHY CIT(A) HAS ERRED IN SUSTAINING AN A DDITION OF RS. 6,00,000/- IN THE INCOME OF THE ASSESSEE UNDER SECTION 68 OF THE ACT ON ACCOUNT OF UNEXPLAINED CASH CREDITS. 3. THAT THE ADDITION SUSTAINED BY THE LD. CIT(A) ARE A GAINST THE FACTS AND CIRCUMSTANCES OF THE CASE. 4. THAT THE WORTHY CIT(A) HAS ERRED IN CONCLUDING THAT THE IDENTITY AND CREDITWORTHINESS OF THE UNSECURED LOANS HAVE NOT BE EN PROVED. 5. THAT THE APPELLANT CRAVES LEAVE TO ADD/AMEND ANY GR OUND OF APPEAL DURING THE COURSE OF APPELLATE PROCEEDINGS. 2. AT THE TIME OF HEARING NO ONE WAS PRESENT ON BEH ALF THE ASSESSEE. THE APPEAL WAS PASSED OVER. IN THE SECOND ROUND SOMEONE APPEARED ALLEGEDL Y ON BEHALF OF THE ASSESSEE STATING THAT HE ITA 1223/CHD/2018 A.Y. 2014-15 PAGE 2 OF 3 HAS BEEN TELEPHONICALLY INSTRUCTED TO APPEAR ON BEH ALF OF MR GAURAV SHARMA. ON CONSIDERING THE RECORD IT WAS SEEN THAT NO POWER OF ATTORNEY HAS BE EN EXECUTED BY THE ASSESSEE IN THE PRESENT APPEAL. THE PERSON APPEARING WITHOUT AUTHORITY PLEA DED THAT HE HAS RECEIVED TELEPHONIC INSTRUCTION TO APPEAR HOWEVER, HE KNOWS NOTHING ABO UT THE CASE. CONSIDERING THE MATERIAL AVAILABLE ON RECORD IT WAS DEEMED APPROPRIATE TO PR OCEED WITH THE PRESENT APPEAL EX- PARTE QUA THE ASSESSEE APPELLANT ON MERIT AFTER HEARING THE L D. SR.DR APPEARING ON BEHALF OF THE REVENUE. 3. THE SHORT ISSUE WHICH IS INVOLVED IN THE PRESENT APPEAL IS THE DEPOSITS OF RS. 6 LACS WHICH WERE QUESTIONED BY THE ASSESSING OFFICER IN THE COU RSE OF THE ASSESSMENT PROCEEDINGS. THE ASSESSEE EXPLAINED THESE AS HAVING BEEN SOURCED FRO M HIS SISTERS MS. RACHANA TIWARI AND MS. NEELAM TIWARI WHO WERE ALSO CLAIMED TO BE INCOME TA X ASSESSEES IN THE YEAR UNDER CONSIDERATION. IN THE CASE OF RACHANA TIWARI, IT WA S STATED THAT SHE WAS ALSO DRAWING SALARY AND GIVING TUITION AND MS. NEELAM WAS EARNING ONLY FROM TUITIONS. APART FROM THAT, THE RECEIPT OF MONEY WAS ALSO EXPLAINED AS FUNDS MADE AVAILABLE BY THE MOTHER SMT. REKHA TIWARI WHO HAD BEEN AN INCOME TAX ASSESSEE FOR THE LAST MANY YEARS AND WAS RECEIVING INCOME FROM RENT AND INTEREST INCOME. THE EXPLANATION OFFERED BY THE ASS ESSEE WAS NOT ACCEPTED BY THE ASSESSING OFFICER WHO WAS OF THE VIEW THAT HER INTEREST INCOM E WOULD BE DEPOSITED DIRECTLY IN THE BANK AND THE RENTAL INCOME RECEIVED BY HER ON A MONTHLY BASI S MAY HAVE BEEN UTILISED SINCE THE AMOUNTS WERE ADVANCED TO THE ASSESSEES FROM THE BANKS WHERE IN THERE WERE DEPOSITS OF RS. 2 LACS EACH IMMEDIATELY PRIOR TO THE MAKING OF THE ADVANCE. TH E ASSESSING OFFICER TREATED THE SAME AS ASSESSEES INCOME. 4. THE ISSUE WAS CARRIED IN APPEAL BEFORE THE CIT-A WHEREIN THE COPIES OF THE INCOME TAX RETURNS AND SUPPORTING DOCUMENTS WERE FILED. THESE WERE CONFRONTED TO THE ASSESSING OFFICER WHO SUBMITTED THAT THESE HAVE ALREADY BEEN CONSIDER ED IN THE ASSESSMENT PROCEEDINGS AND INFACT IS NOT ADDITIONAL EVIDENCE. ACCORDINGLY, THE CIT-A CONFIRMED THE ADDITIONS. THE LD. SR.DR RELIES UPON THE ORDERS. 5. IN THE CONTEXT OF THE FACTS AS SET OUT IN THE OR DERS AND BRIEFLY REFERRED TO HEREINABOVE, I FIND THAT THE MOOT ISSUE WHICH THE TAX AUTHORITIES WERE REQUIRED TO LOOK INTO WAS THE POSSIBILITY WHETHER THE 2 SISTERS AND THE MOTHER COULD HAVE BEE N SAID TO HAVE SAVED AN AMOUNT OF RS. 2 LAKH ITA 1223/CHD/2018 A.Y. 2014-15 PAGE 3 OF 3 EACH IMMEDIATELY PRIOR TO ISSUANCE OF CHEQUE. THE F ACT THAT THE AMOUNTS WERE DEPOSITED IN CASH IMMEDIATELY PRIOR TO THE ISSUANCE OF CHEQUE PER-SE DOES NOT LEAD TO THE CONCLUSION THAT THIS WAS NECESSARILY THE ASSESSEES FUNDS ROUTED BACK TO HIM . THE 3 LADIES WERE IDENTIFIED AS TAXPAYERS AND IN THE CIRCUMSTANCES IT WAS NECESSARY TO CONSIDER W HETHER THEY COULD HAVE AN AMOUNT OF 2 LAKH EACH AT THE RELEVANT POINT OF TIME FOR ADVANCING TO THE BROTHER/SON. IT IS SEEN THAT THE ASSESSEE HAS ALSO NOT BEEN ABLE TO PUT ITS CASE PROPERLY AND INF ACT TREATS THE EVIDENCES RELIED UPON BEFORE THE ASSESSING OFFICER AS FRESH EVIDENCES. THE TAX AUTHO RITIES CONSIDERING THE EVIDENCES FILED SHOULD HAVE REQUIRED THE ASSESSEE TO BETTER PUT UP ITS CAS E BY RE1QUIRING HIM TO ADDRESS BY SUPPORTING DOCUMENTS, IF ANY AS TO THE POSSIBLE SAVINGS THE TH REE LADIES COULD HAVE MADE OVER THE YEARS. ACCORDINGLY, IN THE INTERESTS OF SUBSTANTIAL JUSTIC E, THE IMPUGNED ORDER IS SET ASIDE BACK TO THE FILE OF THE CIT(A) WITH A DIRECTION TO PASS A SPEAKING O RDER IN ACCORDANCE WITH LAW AFTER GIVING THE ASSESSEE A REASONABLE OPPORTUNITY OF BEING HEARD. T HE ASSESSEE, IN ITS OWN INTERESTS IS ADVISED TO MAKE FULL AND PROPER COMPLIANCES AND ASSIST THE TAX AUTHORITY TO ARRIVE AT A FAIR CONCLUSION. SAID ORDER WAS PRONOUNCED AT THE TIME OF HEARING ITSELF 6. IN THE RESULT THE APPEAL OF THE ASSESSEE IS ALLO WED FOR STATISTICAL PURPOSES ORDER PRONOUNCED IN THE OPEN COURT ON 30.05. 2019. SD/- ( ) (DIVA SINGH) ! /JUDICIAL MEMBER % & %( )* +* / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT - 2. / THE RESPONDENT - 3. ! , / CIT 4. ! , ( )/ THE CIT(A) 5. *-. / , # / , 012.3 / DR, ITAT, CHANDIGARH 6. .2 4' / GUARD FILE %( ! / BY ORDER, 5 / ASSISTANT REGISTRAR