Smt Jharna Saha, Kolkata V. ITO, WD-40(1), KOLKATA, Kolkata

ITA 1258/KOL/2016

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 1874 (ITAT-KOLKATA)
• Duration Of Justice: 10 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-04-2017
• Appeal Filed By: Assessee
• Bench Allotted: SMC
• Next Hearing Date: 08-12-2016
• Assessment Year: 2009-2010
• Appeal Filed On: 03-06-2016
• Court: TRIBUNAL
• Department Lawyers: ANIL KUMAR PANDEADDLCIT
• Assessee Lawyers: MANOJ KATARUKA

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL D, BENC H KOLKATA BEFORE SHRI S.S.VISWANETHRA RAVI, JM & DR. A.L.SAI NI, AM ./ ITA NO.1258/KOL/2016 ( / ASSESSMENT YEAR :2009-2010) SMT. JHARNA SAHA, CB1/13, DESHBANDHU NAGAR BAGUIHATI KOLKATA-700059 VS. ITO, WARD-40(1), 3, GOVERNMENT PLACE (WEST) KOLKATA-700001 ./ ./PAN/GIR NO. : AURPS0095A ( /APPELLANT ) .. ( / RESPONDENT ) /REVENUE BY : SHRI ANIL KUMAR PANDE,ADDL-CIT /ASSESSEE BY : SHRI MANOJ KATARUKA, ADV. / DATE OF HEARING : 17/04/2017 /DATE OF PRONOUNCEMENT 19/04/2017 / O R D E R PER DR. ARJUN LAL SAINI, AM THE CAPTIONED APPEAL FILED BY THE ASSESSEE, PERTAI NING TO THE ASSESSMENT YEAR 2009-2010, IS DIRECTED AGAINST THE ORDER PASSED BY THE LD. COMMISSIONER OF INCOME TAX (APPEALS)-13, KOLKAT A, IN APPEAL NO.202/CIT(A)-13/WD-40(1)/2014-15/KOL, DATED 19.02. 2016, WHICH IN TURN ARISES OUT OF AN ORDER PASSED BY THE ASSESSING OFFI CER U/S.143(3) OF THE INCOME TAX ACT 1961, (HEREINAFTER REFERRED TO AS TH E ACT), DATED 11.11.2011. 2. BRIEF FACTS OF THE CASE QUA THE ASSESSEE ARE THA T THE ASSESSEE HAS SUBMITTED HIS RETURN OF INCOME ON 30.03.2010 DISCLO SING TOTAL INCOME OF RS.2,05,250/-. THE RETURN OF INCOME OF THE ASSESSE E WAS PROCESSED U/S 143(1) OF THE ACT ON 15.12.2010. LATER ON, THE ASSE SSEES CASE WAS SELECTED FOR SCRUTINY U/S.143(3) OF THE ACT AND THE AO MADE ADDITION OF ITA NO.1258/KOL/2016 SMT. JHARNA SAHA 2 RS.8,00,213/- ON ACCOUNT OF ASSETS UNDISCLOSED AND RS.8,10,000/- ON ACCOUNT OF UNDISCLOSED FIXED DEPOSITS. 3. AGGRIEVED FROM THESE TWO ADDITIONS MADE BY THE ASSESSING OFFICER, THE ASSESSEE FILED AN APPEAL BEFORE THE LD COMMISSIONER OF INCOME TAX (APPEALS) WHO HAS CONFIRMED BOTH THE ADDITIONS. THE LD CIT (A) OBSERVED THAT THE ASSESSEE DID NOT SUBMIT ANY BILLS, VOUCHER S AND EVIDENCES OF STITCHING & EMBROIDERY WORK. THE ASSESSEE DID NOT P RODUCE INVOICES FOR PURCHASES OF RAW MATERIALS AND FAILED TO PROVE THE IDENTITY OF CUSTOMERS. THE LD CIT(A) FURTHER HELD THAT ASSESSEE HAD MERELY CREATED DOCUMENTS AND RETURNS OF INCOME TAX WERE FILED TO CREATE CAPI TAL. THIS WAY, THE LD CIT(A) CONFIRMED THE ADDITION MADE BY THE AO AT RS. 8,00,213/-. 4. REGARDING ADDITION OF RS. 8,10,000/- WHICH RELAT ES TO 50% OF THE FIXED DEPOSITS (FD), THE LD.CIT(A) OBSERVED THAT ASSESSE E`S TOTAL INCOME IS MORE THAN HER HUSBAND`S INCOME AND HER HUSBAND`S SO URCE OF INCOME WAS ALSO NOT ESTABLISHED THEREFORE, 50% FIXED DEPOS ITS MAY BELONG TO HER. DURING THE ASSESSMENT PROCEEDINGS THE ASSESSEE DENI ED HAVING ANY RELATION WITH BANK ACCOUNT NO.02601010025852 AND EX PLAINED TO THE AO THAT HER HUSBAND MAINTAINS THE SAID ACCOUNT BUT HER STATEMENT SHOULD NOT BE RELIED BECAUSE THE ASSESSEE`S RETURN OF INCOME, OF PAST YEARS, HAD NOT BEEN SCRUTINIZED UNDER SECTION 143 (3) OF THE ACT AND THEREFORE, THE LD CIT(A) CONFIRMED THE ADDITION OF RS. 8,10,000/-. 5. DISSATISFIED WITH THE ORDER OF LD CIT (A), THE A SSESSEE IS IN FURTHER APPEAL BEFORE US AND HAS TAKEN THE FOLLOWING GROUND S OF APPEALS: ITA NO.1258/KOL/2016 SMT. JHARNA SAHA 3 1.THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE ACTION OF THE LD CIT(A) TO UPHOLD THE ADDITION MADE BY THE ASSESSING OFFICER IN ADDING BACK THE ENTIRE ASSETS AS UNDISCLOSED INCOME OF RS. 8,00,213/- IN CONTRARY TO THE FACTS AND MATERIAL EVIDENCES ON RECORD AND I S BAD IN LAW. 2. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE, AND MATERIAL EVIDENCES ON RECORD, THE ACTION OF THE LD CIT(A) TO UPHOLD THE ADDITION OF THE ASSESSING OFFICER TO ADD BACK AN AMOUNT OF RS. 8,10,000/- ON ACCOUNT OF 50% OF THE FIXED DEPOSITS AS INVESTMENT FROM UND ISCLOSED SOURCES IS CONTRARY TO THE MATERIAL EVIDENCES ON RECORD AND TH E ADDITION MADE IS BAD IN LAW. 3. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE ADDITIONS MADE BY THE ASSESSING OFFICER AND UPHELD BY THE LD CIT(A) I S ARBITRARY, ILLEGAL AND EXCESSIVE. 6. THE FIRST GROUND RELATES TO ADDITION ON ACCOUNT OF UNDISCLOSED ASSETS RS.8,00,213. 6.1 THE LD AR FOR THE ASSESSEE HAS SUBMITTED BEFORE US THAT ASSESSEE FILES REGULAR INCOME TAX RETURN AND PREPARES PROFIT AND LOSS ACCOUNT AND BALANCE SHEET EVERY YEAR. THE BALANCE SHEET OF THE ASSESSEE AS ON MARCH 31,2009 SHOWS THE TOTAL ASSETS AT RS.8,00,213 /- AND TOTAL LIABILITIES AT RS. 8,00,213/-, AND THIS WAY THE BALANCE SHEET O F THE ASSESSEE HAS FULLY AGREED AND DOES NOT CONTAIN ANY ERROR. BUT TH E ASSESSING OFFICER MADE ADDITION OF RS.8,00,213/- ( GRAND TOTAL OF ASS ETS SIDE OF THE BALANCE SHEET). ASSETS SIDE OF THE BALANCE SHEET OF THE ASS ESSEE CONTAINS LAND, FLAT, LOANS AND ADVANCES, GOLD & ORNAMANTS AND CASH AND BANK BALANCE. THE ASSESSING OFFICER DID NOT POINT OUT AN Y MISTAKE IN ANY OF THE ASSETS MENTIONED IN THE BALANCE SHEET THEREFORE, TH E ADDITION MADE BY THE ASSESSING OFFICER IS TOTALLY ARBITRARY AND WITH OUT ANY LOGIC. IN THE BALANCE SHEET OF THE ASSESSEE THE CAPITAL ACCOUNT O F THE ASSESSEE DOES AGREE WITH THE PREVIOUS YEARS` BALANCE SHEET. THE L D AR FOR THE ASSESEE ITA NO.1258/KOL/2016 SMT. JHARNA SAHA 4 HAS SUBMITTED BEFORE US THE BALANCE SHEETS OF THE A SSESSEE AS ON 31.03.2008, AND 31.03.2007 WHERE OPENING AND CLOSIN G BALANCES OF ASSETS AND LIABILITIES DO NOT CONTAIN ANY ERROR. MO REOVER, THE ASSESSEE HAS BEEN FILING RETURN OF INCOME SINCE LAST MANY YE ARS AND ASSESSMENTS WERE COMPLETED UNDER SECTION 143(1) OF THE ACT. 6.2 ON THE OTHER HAND, THE LD DR FOR THE REVENUE HA S PRIMARILY REITERATED THE STAND TAKEN BY THE ASSESSING OFFICER, WHICH WE HAVE ALREADY NOTED IN OUR EARLIER PARA AND IS NOT BEING REPEATED FOR THE SAKE OF BREVITY. 6.3 HAVING HEARD THE RIVAL SUBMISSION AND PERUSED T HE MATERIAL AVAILABLE ON RECORD, WE NOTICED THAT ASSESSEE UNDER CONSIDERA TION HAS BEEN FILING RETURN OF INCOME AND PREPARING PROFIT AND LOSS ACC OUNT AND BALANCE SHEET SINCE LAST MANY YEARS. THE ASSESSMENT OF THE ASSESSEE HAD BEEN COMPLETED UNDER SECTION 143 (1) OF THE ACT IN PAST YEARS. THE CLOSING BALANCES OF THE PREVIOUS YEARS HAVE BEEN CARRIED FO RWARD IN SUBSEQUENT YEARS. IT IS NOT CLEAR FROM EITHER OF THE ORDER ( AO ORDER AND CIT(A) ORDER) THAT ON WHAT MATERIAL THIS ADDITION WAS BASED. THE ADDITION MADE BY THE AO AND CONFIRMED BY THE LD CIT(A) IS WITHOUT ANY BA SE. THEREFORE, WE DELETE THE ADDITION OF RS.8,00,213/- 6.4 IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE ON GROUND NO.1, IS ALLOWED. 7. SECOND GROUND RAISED BY THE ASSESSEE RELATES TO ADDITION OF RS.8,10,000/- ( 50% OF FIXED DEPOSITS), AS INVESTME NT FROM UNDISCLOSED SOURCES. ITA NO.1258/KOL/2016 SMT. JHARNA SAHA 5 7.1 THE LD AR FOR THE ASSESSEE HAS SUBMITTED BEFORE US THAT ALL THE FIXED DEPOSITS WERE DISCLOSED IN THE RETURN OF INCOME OF THE ASSESSEE`S HUSBAND. THE HUSBAND OF THE ASSESSEE HAS OWNERSHIP OF ALL THE FIXED DEPOSITS. THE ASSESSEE DENIED TO THE ASSESSING OFFI CER THAT NO ANY FIXED DEPOSIT RELATES TO HER. SHE HAS NOT SHOWN THESE FIX ED DEPOSITS IN HER RETURN OF INCOME. THESE FIXED DEPOSITS WERE MADE OU T OF JOINT BANK ACCOUNT AND HUSBAND OF THE ASSESSEE IS DISCLOSING T HE INTEREST INCOME OF THESE FIXED DEPOSITS IN HIS RETURN OF INCOME AND PA YING TAXES THEREON. THE LD AR FOR THE ASSESSEE SUBMITTED BEFORE US THE BALA NCE SHEET OF ASSESSEE`S HUSBAND AND PROVED THAT ALL FIXED DEPOSI TS WERE IN THE NAME OF HUNBAND AND THESE FIXED DEPOSTS WERE MADE OUT OF THE EARNING OF THE HUSBAND. 7.2 ON THE OTHER HAND, THE LD DR FOR THE REVENUE HA S PRIMARILY REITERATED THE STAND TAKEN BY THE ASSESSING OFFICER, WHICH WE HAVE ALREADY NOTED IN OUR EARLIER PARA AND IS NOT BEING REPEATED FOR THE SAKE OF BREVITY. 7.3 HAVING HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD, WE NOTICED THAT ALL FIXED DEPOSITS WERE SHOWN BY THE ASSESSEE`S HUSBAND. THESE ARE MADE OUT OF THE INCOM E EARNED BY THE HUSBAND. THE ASSESSEE`S HUSBAND HAS BEEN FILING THE RETURN OF INCOME SINCE PAST MANY YEARS AND HAS BEEN PAYING TAXES ON THE INTEREST INCOME OF THESE FIXED DEPOSITS. IT IS NOT CLEAR FROM EITHE R OF THE ORDER ( ORDER OF AO AND ORDER OF CIT(A) ) THAT ON WHAT MATERIAL THIS ADDITION IS BASED. IT IS VERY MUCH CLEAR THAT ALL FIXED DEPOSITS WERE MADE O UT OF THE INCOME EARNED BY ASSESSEE`S HUSBAND AND HUSBAND HAS BEEN D ISCLOSING THEM IN ITA NO.1258/KOL/2016 SMT. JHARNA SAHA 6 HIS RETURN ON INCOME AND PAYING TAXES ON ACCRUED IN TEREST, THEREFORE, CONSIDERING THE FACTUAL POSITION THE ADDITION MADE BY THE ASSESSING OFFICER AND CONFIRMED BY THE LD CIT(A) NEEDS TO BE DELETED. ACCORDINGLY, WE DELETE THE ADDITION. 7.4 IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE ON GROUND NO., 2 IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 19/ 04/2017. SD/ - (S.S.VISWANETHRA RAVI) SD/ - (DR. A.L.SAINI) / JUDICIAL MEMBER / ACCOUNTANT MEMBER /KOLKATA ; $% DATED 19/04/2017 & ()* /PRAKASH MISHRA ,SR.PS. / COPY OF THE ORDER FORWARDED TO : / BY ORDER, / ( ASSTT. REGISTRAR) & ' , / ITAT, KOLKATA 1. / THE APPELLANT- SMT. JHARNA SAHA 2. / THE RESPONDENT.-ITO WD-40(1), KOLKATA 3. 4 ( ) / THE CIT(A), KOLKATA. 4. 4 / CIT 5. 56 7 8 , 8 , / DR, ITAT, KOLKATA 6. 7 9 / GUARD FILE. 5 //TRUE COPY//