Smt. Kusumlata, Bangalore V. ITO, Bangalore

ITA 1245/BANG/2013

• Counselvise Citation: 124521114 RSA 2013
• Duration Of Justice: 1 year(s) 2 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-10-2014
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 30-10-2014
• Assessment Year: 2006-2007
• Appeal Filed On: 13-08-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: DR K SHANKAR PRA SAD
• Assessee Lawyers: VINOD KUMAR NAIDU KV

Judgement Text

ITA NO.1245 OF 2013 SMT KUMUMLATA BANGALORE. PAGE 1 OF 3 IN THE INCOME TAX APPELLATE TRIBUNAL BANGALORE C BENCH, BANGALORE BEFORE SHRI RAJPAL YADAV, JUDICIAL MEMBER AND SHRI ABRAHAM P. GEORGE, ACCOUNTANT MEMBER ITA NO.1245/BANG/2013 (ASSESSMENT YEAR: 2006-07) SMT. KUSUMALATA NO.44 ROBERTSON, FRAZER TOWN, BANGALORE 560005 PAN: AAGPL 5649 G VS. INCOME TAX OFFICER WARD 1(2) BANGALORE (APPELLANT) (RESPONDENT) ASSESSEE BY: SHRI VINOD KUMAR NAIDU KV, ADVOCATE DEPARTMENT BY: DR.K.SHANKAR PRASA D, (DR) DATE OF HEARING: 30/10/2014 DATE OF PRONOUNCEMENT: 31/10/2014 O R D E R PER RAJPAL YADAV, J.M. THE ASSESSEE IS IN APPEAL BEFORE US AGAINST THE ORD ER OF THE LEARNED CIT (A) DATED 28.05.2013 PASSED FOR ASSESSM ENT YEAR 2006-07. THE SOLITARY GRIEVANCE OF THE ASSESSEE IS THAT THE LEARNED CIT (A) ERRED IN CONFIRMING THE ADDITION OF RS.4,69,876/-. 2. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSE E HAS FILED HER RETURN OF INCOME ON 31.10.2014 DECLARING AN INC OME OF RS.1,31,417/-. THE SOURCE OF INCOME OF THE ASSESSEE IS CAPITAL GAIN, INTEREST INCOME AND DIVIDEND INCOME. THE ASSE SSEE HAS SHOWN AN INTEREST INCOME OF RS.98,668/-. ON AN ANAL YSIS OF THE RECORD, ASSESSING OFFICER FOUND THAT THE CAPITAL AC COUNT PREPARED BY THE ASSESSEE AND OTHER STATEMENT OF AFFAIRS FILE D DID NOT HAVE COHERENCE WITH EACH OTHER. HE MADE VARIOUS ADDITION S AND DETERMINE THE TAXABLE INCOME OF RS.7,00,030/-. THE ASSESSEE HAS ITA NO.1245 OF 2013 SMT KUMUMLATA BANGALORE. PAGE 2 OF 3 EXPLAINED THOSE CONTRADICTIONS AND THE LEARNED CIT (A) HAS DELETED THE MAJOR ADDITIONS. WITH REGARD TO THE ADD ITION CONFIRMED BY THE CIT (A) AND DISPUTED IN THE PRESEN T APPEAL, THE FACTS HIGHLIGHTED BY THE ASSESSING OFFICER ARE THAT THE ASSESSEE HAS SHOWN INTEREST INCOME OF RS.98,668/-. IT MEANS, SHE WAS EARNING INTEREST INCOME OF RS.270/- PER DAY AT THE AVERAGE RATE OF 21%. ACCORDING TO THE ASSESSING OFFICER FOR EARN ING THIS MUCH OF INTEREST, SHE WOULD REQUIRE A WORKING CAPITAL OF RS.4,69,876/-. HE DIRECTED THE ASSESSEE TO EXPLAIN THE SOURCE OF T HIS WORKING CAPITAL. THE ASSESSEE CONTENDED THAT SHE IS NOT MAI NTAINING BOOKS OF ACCOUNTS. THIS MEAGRE INTEREST INCOME HAS BEEN EARNED BY GIVING SMALL ADVANCES OF RS.1000 TO RS.5000 TO S TREET VENDORS AND THEY WOULD RETURN THE SAME ALONG WITH INTEREST OF 18% TO 24%. SHE HOWEVER, POINTED OUT THAT A PIECE OF LAND WAS SOLD BY HER FOR A CONSIDERATION OF RS.4,13,550/- SHE HAS RE CEIVED RS.2.00 LAKHS AS ADVANCE FOR SALE OF LAND WITH AN A GREEMENT DATED 19.03.2005. THE BALANCE AMOUNT WAS RECEIVED O N 6.2.2006. WITH THE SAID ADVANCE OF RS.2.00 LAKHS, T HE CASH ON HAND WITH THE ASSESSEE WAS AROUND RS.50,000/- WHICH WAS USED FOR GIVING LOANS ETC. THE ASSESSING OFFICER DID NOT ACCEPT THE CONTENTION OF THE ASSESSEE BECAUSE SHE HAS FAILED T O EXPLAIN THE SOURCE OF THE MONEY. ACCORDINGLY HE MADE THE ADDITI ON. 3. APPEAL TO THE CIT (A) DID NOT BRING ANY RELIEF T O THE ASSESSEE. 4. WE HAVE DULY CONSIDERED THE RIVAL CONTENTIONS AN D GONE THROUGH THE RECORD CAREFULLY. THE WORKING CAPITAL A SSUMED BY THE ASSESSING OFFICER IS BY COMPUTING THE DAILY INTERES T INCOME AND HOW MUCH MONEY CAPITAL COULD GENERATE SUCH AN INTER EST INCOME. ASSESSING OFFICER WAS NOT HAVING ANY EVIDEN CE THAT TH ITA NO.1245 OF 2013 SMT KUMUMLATA BANGALORE. PAGE 3 OF 3 ASSESSEE HAS UNEXPLAINED INCOME OF RS.4,69,876/-. A T THE MOST HE COULD REFUSE TO ACCEPT THE SOURCE OF THE INTERES T INCOME OF RS.98,668/-. THIS AMOUNT COULD BE ASSESSED AS AN IN COME FROM UNEXPLAINED SOURCE. THE ASSESSEE IS NOT A PERSON BE LONGING TO ANY ORGANISED SECTOR. SHE HAS A MEAGRE INCOME OF RS .13,417/-. SHE WAS NOT MAINTAINING ANY BOOKS OF ACCOUNTS. IF T HE ASSESSING OFFICER HAS ANY DOUBT ABOUT HAVING SUBSTANTIAL WORK ING CAPITAL WITH THE ASSESSEE, HE COULD HAVE EXAMINED HER BANK ACCOUNT OR DETAILS OF OTHER ASSETS. ASSESSING OFFICER DID OT F IND THE FACTS IN THE EXPLANATION OF THE ASSESSEE THAT SHE HAS SOLD L AND AND RECEIVED ADVANCE WHICH WAS USED FOR EARNING INTERES T INCOME. THEREFORE, ON THE BASIS OF THIS ASSUMED WORKING CAP ITAL, ADDITION CANNOT BE MADE IN THE HANDS OF THE ASSESSEE. WE ALL OW THE APPEAL OF THE ASSESSEE AND DELETE THE ADDITION. ORDER PRONOUNCED IN THE OPEN COURT ON 31 ST OCTOBER, 2014. SD/- SD/- (ABRAHAM P. GEORGE) (RAJPAL YADAV) ACCOUNTANT MEMBER JUDICIAL MEMBER BANGALORE DATED 31 ST OCTOBER, 2014. VNODAN/SPS COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CONCERNED CIT(A) 4. THE CONCERNED CIT 5. THE DR, ITAT, BANGALORE 6. GUARD FILE BY ORDER ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL, BANGALORE BENCHES, BANGALORE