Smt. Jhuma Neogi, Hyd., Hyderabad V. ITO, Hyderabad

ITA 1266/HYD/2013

• Counselvise Citation: 126622514 RSA 2013
• Duration Of Justice: 2 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-11-2013
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2009-2010
• Appeal Filed On: 11-09-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ADAGIRI
• Keywords: Unexplained cash credit; Unexplained investment; Opportunity of being heard
• Section: 143(3); 68; 69

Judgement Text

1 ITA.NO.1266/HYD/2013 SMT. JHUMA NEOGI, HYDERABAD IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCHES A : HYDERABAD BEFORE SHRI B. RAMAKOTAIAH, ACCOUNTANT MEMBER AND SMT. ASHA VIJAYARAGHAVAN, JUDICIAL MEMBER ITA.NO.1266/HYD/2013 ASSESSMENT YEAR 2009-2010 SMT.JHUMA NEOGI HYDERABAD PAN AEVPN3182P VS. ITO, WARD 8 (2) HYDERABAD (APPELLANT) (RESPONDENT) FOR APPELLANT : SHRI K.C. DEVDAS (A.R.) FOR RESPONDENT : SHRI B. YADAGIRI (D.R.) DATE OF HEARING : 28.10.2013 DATE OF PRONOUNCEMENT : 13.11.2013 ORDER PER SMT. ASHA VIJAYARAGHAVAN, J.M. THIS APPEAL IS FILED BY THE ASSESSEE AGAINST THE ORDER OF THE CIT(A)-III, HYDERABAD DATED 09.07.2013 FOR THE ASSE SSMENT YEAR 2009-2010. 2. THE ASSESSEE IS AN INDIVIDUAL IS A GOLDSMITH BY PROFESSION. FOR THE ASSESSMENT YEAR 2009-2010 THE ASSESSEE FILED RE TURN OF INCOME ON 11.02.2010 ADMITTING INCOME OF RS.3,54,075/-. THE A SSESSING OFFICER COMPLETED THE ASSESSMENT UNDER SECTION 143(3) BY MA KING THE FOLLOWING ADDITIONS : I) UNEXPLAINED DEPOSITS IN BANK ADDED U/S. 69 RS .13,23,000/- II) UNEXPLAINED CASH CREDITS ADDED U/S. 68 R S.24,95,460/- III) OUTSTANDING LIABILITIES IN BALANCE SH EET DISALLOWED RS.65,677 I V) THE DIFFERENCE BETWEEN SUB-REGISTRAR VALUATION AND ACTUAL PURCHASE CONSIDERATION ADDED U/S.69B RS.5,30,000/- V) PAYMENT OF LIC DISALLOWED IN THE ABSENCE OF PRO OF RS.34,735/- AND TOTAL INCOME IS DETERMINED AT RS.48,02,947/-. 2 ITA.NO.1266/HYD/2013 SMT. JHUMA NEOGI, HYDERABAD 3. AGGRIEVED BY THE ASSESSMENT ORDER, THE ASSESSEE PREFERRED AN APPEAL BEFORE THE CIT(A). THE LEARNED CIT(A) CONFIRMED THE ORDER OF THE ASSESSING OFFICER WITH RESPECT TO THE FOLLOWING ADDITIONS : A) UNEXPLAINED DEPOSITS IN BANK ADDED U/S. 69 R S.13,23,000/- B) OUTSTANDING LIABILITIES IN BALANCE SHE ET DISALLOWED RS.65,677 C ) THE DIFFERENCE BETWEEN SUB-REGISTRAR VALUATION AND ACTUAL PURCHASE CONSIDERATION ADDED U/S.69B RS.5,30,000/- D) PAYMENT OF LIC DISALLOWED IN THE ABSENCE OF PR OOF RS.34,735/- 4. WITH RESPECT TO ADDITION OF AN AMOUNT OF RS.24,9 5,460/- MADE ON ACCOUNT OF UNEXPLAINED UNSECURED LOANS UNDER SECTION 68 OF THE INCOME TAX ACT, 1961 THE LEARNED CIT(A) HELD AS FOLLOWS : 9. I HAVE SEEN CAREFULLY THE FACTS AND EVIDENCE. T HERE IS NO DOUBT ABOUT THE FACT THAT THE APPELLANT HAS NOT PROVIDED EVIDENCE WITH REGARD TO ANY OF THE EXPLANATIONS GIVEN BY HER DURING THE COURSE OF ASSESSMENT PROCEEDINGS. THE EXPLANATION R EGARDING ADVANCES RECEIVED WITH RESPECT TO MAKING CHARGES IS ALSO COMPLETELY UNSUBSTANTIATED. HOWEVER, I FIND THAT TH E APPELLANT HAS PROVIDED CERTAIN DETAILS STATING THAT SOME AMOU NTS ADDED BY THE ASSESSING OFFICER ARE ACTUALLY OPENING BALAN CES AND ARE NOT CASH CREDITS MADE DURING THE YEAR. IN VIEW OF THESE FACTS, THE ASSESSING OFFICER IS DIRECTED TO REDUCE ALL THE OPENING BALANCES FROM THE TOTAL ADDITION MADE. THE BALANCE ADDITION IS ORDERED TO BE CONFIRMED. THE APPELLANT GETS RELIEF ACCORDINGLY. 4.1. THE CIT(A), THUS, PARTLY ALLOWED THE APPEAL O F THE ASSESSEE. 5. AGGRIEVED, THE ASSESSEE IS IN APPEAL BEFORE US. THE LEARNED COUNSEL FOR THE ASSESSEE SHRI K.C. DEVADAS, SUBMITTED THAT THE ASSESSING OFFICER SIMPLY IGNORED THE ASSESSEES EXPLANATION DATED 18.11.2011 WHILE MAKING THE ADDITION ON BANK DEPOSITS OF RS.13,23,000/- UNDER SECTION 69 OF THE ACT. SIMILARLY, WITH RESPECT TO THE ADDITION OF RS.24,95,460/- UNDER SEC TION 68 OF THE ACT, THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE LOWER AUTHORITIES HAD IGNORED THE EXPLANATION FILED IN DETAIL. THE LEARNED COUNSEL FU RTHER SUBMITTED THAT EACH CREDIT WAS SUBSTANTIATED THAT THEY WERE ON ACCOUNT OF BROU GHT FORWARD CREDITS FROM EARLIER YEAR AND THE EARLIER RECORDS WERE NOT VERIF IED BY THE LOWER AUTHORITIES. 3 ITA.NO.1266/HYD/2013 SMT. JHUMA NEOGI, HYDERABAD SIMILAR WAS THE SITUATION WITH RESPECT TO DISALLOWA NCE OF OUTSTANDING LIABILITIES OF RS.65,677/- RELATING TO THE POLISHED CHARGES, SETTI NG CHARGES, SALARY AND WAGES, THE ASSESSEES COUNSEL EXPLAINED THAT THEY RELATED TO LO SSES MAINLY OF THE ACCOUNTING YEAR AND WERE PAID IN THE BEGINNING OF THE SUBSEQUE NT YEAR WHICH WITHOUT VERIFYING THE BOOKS OF THE SUBSEQUENT YEAR WERE ASSESSED ARBI TRARILY AND DISALLOWED BY THE ASSESSING OFFICER AND CONFIRMED BY THE CIT(A). THE LEARNED COUNSEL FOR THE ASSESSEE ALSO DREW OUR ATTENTION TO THE ADDITION OF RS.5,30,000/- BEING THE DIFFERENCE BETWEEN THE GOVERNMENT VALUE OF THE LAND AND THE ACTUAL PURCHASE CONSIDERATION. IT IS SUBMITTED BY THE LEARNED COUNS EL FOR THE ASSESSEE THAT THE AMOUNT OF RS.5,30,000/- WAS BROUGHT AS ADDITION UND ER SECTION 69B AS UNEXPLAINED INVESTMENT WITHOUT RECORDING ANY REASON S FOR THE SAME. THE LEARNED COUNSEL FOR THE ASSESSEE IN SHORT, EXPRESSED HIS DI SPLEASURE IN NOT GIVING A FAIR OPPORTUNITY TO THE ASSESSEE TO EXPLAIN THE CASE BEF ORE THE LOWER AUTHORITIES. 6. WE FIND THAT NONE WAS PRESENT BEFORE THE CIT(A) ON BEHALF OF THE ASSESSEE AND IN THE INTEREST OF JUSTICE, WE ARE OF THE OPINION THAT AN OPPORTUNITY SHOULD BE GIVEN TO THE ASSESSEE TO EXPLAIN THE TRAN SACTIONS OF CASH DEPOSITS AND PRODUCE RELEVANT BANK STATEMENTS IN SUPPORT OF ITS CONTENTION. THE ASSESSEE SHALL ALSO ADDUCE ENOUGH EVIDENCE TO PROVE THAT THE ADDIT ION OF RS.5,30,000/- UNDER SECTION 69B IS UNJUSTIFIED AS THE SALE OF THE PROPE RTY WAS A DISTRESS SALE AND THE DIFFERENCE BETWEEN THE SUB-REGISTRAR RATE OF THE PR OPERTY AND THAT DISCLOSED BY THE ASSESSEE ARE DUE TO VALID REASONS. IN THESE CIRCUMS TANCES, WE DEEM IT FIT TO RESTORE THE ISSUE TO THE FILE OF THE ASSESSING OFFICER WHO SHALL EXAMINE THE ISSUES AND DECIDE THEM DENOVO IN ACCORDANCE WITH LAW, AFTER GI VING A DUE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. 7. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWE D FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 13.11.2013. SD/- SD/- (B. RAMAKOTAIAH) (ASHA VIJAYARAGHAVAN) ACCOUNTANT MEMBER JUDICIAL MEMBER HYDERABAD, DATE 13 TH NOVEMBER, 2013. VBP/- 4 ITA.NO.1266/HYD/2013 SMT. JHUMA NEOGI, HYDERABAD COPY TO 1. SMT. JHUMA NEOGI, 21-7-371, SHAKKAR KOTA, CHARKA MAN, HYDERABAD 500 003. 2. THE ITO, WARD 8(2), HYDERABAD. 3. CIT(A)-III, HYDERABAD 4. CIT-II, HYDERABAD 5. D.R. A BENCH, ITAT HYDERABAD