R.K.Malathy, CHENNAI V. ITO, CHENNAI

ITA 1261/CHNY/2016

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 4406 (ITAT-CHENNAI)
• Duration Of Justice: 1 year(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-05-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 29-05-2017
• Assessment Year: misc
• Appeal Filed On: 09-05-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: NETHRAPAL IRS
• Assessee Lawyers: A S SRIRAMAN
• Keywords: Unexplained cash credit; Gift

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL A (SMC) BENCH : CHENNAI . , [BEFORE SHRI ABRAHAM P. GEORGE, ACCOUNTANT M EMBER ] ./I.T.A. NO. 1261/MDS/2016 / ASSESSMENT YEAR : 2010-2011. SMT. R.K. MALATHY, NO.12, PADMAVATHY NAGAR, IIND STREET, MOHAN GARDEN, KORATTUR, CHENNAI 600 080. [PAN AZQPM 2132G] VS. THE INCOME TAX OFFICER, BUSINESS WARD XIII (4) CHENNAI. ( !' / APPELLANT) ( #$!' /RESPONDENT) / APPELLANT BY : SHRI. A.S. SRIRAMAN, ADVOCATE /RESPONDENT BY : SHRI. M.S. NETHRAPAL, IRS, JCIT. /DATE OF HEARING : 29-05-2017 !' /DATE OF PRONOUNCEMENT : 31-05-2017 % / O R D E R THIS IS AN APPEAL FILED BY THE ASSESSEE DIRECTED A GAINST AN ORDER DATED 17.12.2015 OF LD. COMMISSIONER OF INCOM E TAX (APPEALS)- 7, CHENNAI. . ITA NO.1261/MDS/2016 :- 2 -: 2. APPEAL HAS BEEN FILED WITH A DELAY OF EIGHTY FOUR D AYS. ASSESSEE HAS FILED A CONDONATION PETITION IN WHICH IT SAYS THAT HER CHARTERED ACCOUNTANT FELL ILL AND COULD NOT GIVE AD VICE NOR FILE THE APPEAL IN TIME. LD. DEPARTMENTAL REPRESENTATIVE D ID NOT RAISE ANY SERIOUS OBJECTION. ACCORDINGLY DELAY IS CONDONED. A PPEAL IS ADMITTED. 3. THE ONLY EFFECTIVE GROUND TAKEN BY THE ASSESSEE IS ON SUSTENANCE OF AN ADDITION OF E27,42,370/- CONSIDER ED BY THE LD. ASSESSING OFFICER AS UNEXPLAINED CREDIT IN THE BANK ACCOUNTS OF THE ASSESSEE. DURING THE COURSE OF ASSESSMENT PROCEEDI NGS OF THE ASSESSEE, WHO WAS HAVING INCOME ONLY FROM CAPITAL G AINS AND OTHER SOURCES, IT WAS NOTED BY THE LD. ASSESSING OFFICER THAT SHE HAD TWO BANK ACCOUNTS, ONE WITH M/S. PUNJAB NATIONAL BANK, ANNA NAGAR BRANCH AND ANOTHER WITH M/S. CENTRAL BANK OF INDIA, KILPAUK BRANCH. LD. ASSESSING OFFICER FOUND THAT ASSESSEE HAD MADE THE FOLLOWING CASH DEPOSITS IN THE ABOVE BANK ACCOUNTS. SL.NO NAME OF THE BANK DATE OF DEPOSIT AMOUNT OF DEPOSIT (RS) 1 CENTRAL BANK OF INDIA 11/7/2009 1,000 2 CENTRAL BANK OF INDIA 15/7/2009 5,00,000 3 CENTRAL BANK OF INDIA 08/08/2009 5,00,000 4 CENTRAL BANK OF INDIA 11/12/2009 8,00,000 5 CENTRAL BANK OF INDIA 11/12/2009 10,000 6 CENTRAL BANK OF INDIA 12/12/2009 4,000 7 PUNJAB NATIONAL BANK 13/07/2009 1,000 8 PUNJAB NATIONAL BANK 06/07/2009 5,00,000 PUNJAB NATIONAL BANK 22/08/2009 6,00,000 TOTAL 29,15,000 ITA NO.1261/MDS/2016 :- 3 -: SINCE ASSESSEE WAS A NON RESIDENT INDIAN, SETTLED I N MIDDLE EAST, SHE WAS REPRESENTED BY HER FATHER. IT SEEMS HE WAS NOT ABLE TO GIVE DETAILS AND SOURCE FOR THE DEPOSITS IN THE ABOVE BA NK ACCOUNTS. LD. ASSESSING OFFICER MADE AN ADDITION FOR THE ENTIRE CASH DEPOSITS IN THE BANK ACCOUNTS AFTER DEDUCTING THE RETURNED INCOME OF E1,72,630/-. 4. IN HER APPEAL BEFORE LD. COMMISSIONER OF INCOME TAX (APPEALS), ARGUMENT OF THE ASSESSEE WAS THAT SHE HA D SOLD GOLD JEWELLERY AND SILVER ARTICLES GIFTED TO HER BY HE R GRANDFATHER IN 1995 WHEN SHE WAS NINE YEARS OF AGE. AS PER THE ASSESS EE A DECLARATION OF GIFT, EXECUTED ON 5 TH JULY, 1995 BY SHRI. RS ARMUGAM, HER GRANDFATHER WAS FILED BEFORE THE LD. ASSESSING OFFICER, BUT WA S NOT CONSIDERED. HOWEVER, LD. COMMISSIONER OF INCOME TAX (APPEALS) D ID NOT ACCEPT THE ABOVE CONTENTION, BUT CONFIRMED THE ADDITIONS C ITING THE FOLLOWING REASONS. 1 ) THE SOURCE OF JEWELLERY IN THE HANDS OF GRANDFATH ER HAS NOT BEEN EXPLAINED. NO WEALTH-TAX RETURNS OR A NY OTHER PIECE OF EVIDENCE HAS BEEN BROUGHT ON RECORD TO SUBSTANTIATE THE CONTENTION THAT THE IMPUGNED JEWEL LERY WAS POSSESSED BY THE GRANDFATHER. 2) THERE WAS NO VOLUNTARY DISCLOSURE OF THE SOURCE OF CASH DEPOSITS IN THE RETURN OF INCOME FILED BY THE APPEL LANT. 3) THE MATTER CAME TO LIGHT ONLY ON ACCOUNT OF THE AIR INFORMATION RECEIVED FROM THE BANK. ITA NO.1261/MDS/2016 :- 4 -: 4) CRUCIALLY, THE APPELLANT HAS NOT BEEN ABLE TO BR ING ANY EVIDENCE ON RECORD REGARDING THE SALE OF THE IMPUGN ED JEWELRY AND SILVER ARTICLES. 5) DURING THE COURSE OF HEARING, AUTHORISED REPRESE NTATIVE SUBMITTED THAT THE SALE WAS MADE IN CASH, AND AS SU CH THERE IS NO DOCUMENTATION OR EVIDENCE. 6) IN THE CIRCUMSTANCES, THE APPELLANT HAS NEITHER BEEN ABLE TO GIVE ANY EVIDENCE REGARDING THE SOURCE OF T HE PRECIOUS ITEMS IN THE HANDS OF THE GRANDFATHER, NOR ANY EVIDENCE WHATSOEVER PERTAINING TO THE SALE OF JEWEL LERY AND RECEIPT OF CASH THAT WAS STATED TO HAVE BEEN DEPOSITED IN THE BANK ACCOUNT. 5. NOW BEFORE ME, LD. AUTHORISED REPRESENTATIVE SUBMIT TED THAT THE ASSESSEE BEING A NON RESIDENT INDIAN DID NOT GE T SUFFICIENT OPPORTUNITY TO PRODUCE THE RECORDS RELATING TO SAL E OF GOLD JEWELLERY BEFORE LOWER AUTHORITIES. AS PER LD. AUTHORISED R EPRESENTATIVE THERE WAS A COMMUNICATION GAP BETWEEN THE ASSESSEE AND HE R FATHER WHO WAS REPRESENTING HER. CONTENTION OF THE LD. AUTHOR ISED REPRESENTATIVE WAS THAT ASSESSEE WAS HAVING EVERY RECORD TO PROVE AUCTION OF GOLD JEWELLERY BY ONE M/S. GURUSANTHI AUCTIONEERS, WHICH GAVE ALL DETAILS OF THE MONEY RECEIVED BY HER ON THE SALE OF THE GOLD JEWELLERY, GIFTED TO HER BY HER GRANDFATHER. CONTENTION OF THE LD. AUTHO RISED REPRESENTATIVE WAS THAT ASSESSEE HAVING BECOME A NO N RESIDENT, SHE WAS NOT INTERESTED IN HOLDING ANY GOLD JEWELLERY I N INDIA AND HENCE MADE THE SALE. ITA NO.1261/MDS/2016 :- 5 -: 6. PER CONTRA, LD. DEPARTMENTAL REPRESENTATIVE SUBMITT ED THAT ASSESSEE WAS GIVEN NUMBER OF OPPORTUNITIES BY THE L OWER AUTHORITIES BUT FAILED TO PRODUCE NECESSARY EVIDENCE IN SUPPORT OF THE CREDITS IN THE BANK ACCOUNT. 7. I HAVE CONSIDERED THE RIVAL CONTENTIONS AND PERUSE D THE ORDERS OF THE AUTHORITIES BELOW. CLAIM OF THE ASSES SEE IS THAT SOURCE FOR THE DEPOSITS IN BANK WERE OUT OF SALE PROCEEDS OF GOLD ORNAMENTS GIVEN TO HER BY HER GRANDFATHER WHEN SHE WAS AGED N INE. IT IS NOT DISPUTED BY THE LD. DEPARTMENTAL REPRESENTATIVE TH AT ASSESSEE HAD FILED BEFORE LD. ASSESSING OFFICER A GIFT DEED EXEC UTED ON 5 TH JULY, 1995 BY SHRI. RS ARMUGAM, GRANDFATHER OF THE ASSESSEE. SINCE ASSESSEE IS A NON RESIDENT THERE IS A DISTINCT PROBABILITY THA T SHE WAS NOT ABLE TO REACH OUT TO THE LD. ASSESSING OFFICER AND PRODUCE EVIDENCE OF AUCTION OF GOLD JEWELLERY BY M/S. GURUSANTHI AUCTIONEERS. LD. AUTHORISED REPRESENTATIVE HAS PRODUCED BEFORE ME, RECORDS WHIC H PRIMA FACIE SHOW THAT GURUSANTHI AUCTIONEERS HAD AUCTIONED VAR IOUS ITEMS OF GOLD JEWELLERY OWNED BY THE ASSESSEE. IN THE CIRCUMSTAN CES, I AM OF THE OPINION THAT THE MATTER REQUIRES A FRESH LOOK BY T HE LD. ASSESSING OFFICER. I SET ASIDE THE ORDERS OF THE AUTHORITIES BELOW AND REMIT THE ISSUE REGARDING SOURCE OF DEPOSITS MADE BY THE ASS ESSEE IN HER BANK ACCOUNT BACK TO THE FILE OF THE LD. ASSESSING OFFIC ER, FOR CONSIDERATION ITA NO.1261/MDS/2016 :- 6 -: AFRESH IN ACCORDANCE WITH LAW. ASSESSEE SHALL BE GI VEN ADEQUATE OPPORTUNITY TO FURNISH EVIDENCE IN SUPPORT OF HER CLAIM. 8. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED FO R STATISTICAL PURPOSE. ORDER PRONOUNCED ON WEDNESDAY, THE 31 ST DAY OF MAY, 2017, AT CHENNAI. SD/- ( . ) (ABRAHAM P. GEORGE) / ACCOUNTANT MEMBER #$ / CHENNAI %& / DATED:31ST MAY, 2017 KV &' ()*) / COPY TO: 1 . / APPELLANT 3. +,- / CIT(A) 5. )./ 0 / DR 2. / RESPONDENT 4. + / CIT 6. /12 / GF