ITO, Gurgaon V. Sh. Nanak Bhatti, Gurgaon

ITA 1322/DEL/2013

• Counselvise Citation: 132220114 RSA 2013
• Duration Of Justice: 11 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-02-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: E
• Next Hearing Date: 04-02-2014
• Assessment Year: 2009-2010
• Appeal Filed On: 06-03-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: GUNJAN PRASHAD
• Keywords: Business income; Onus to prove

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL DELHI DELHI DELHI DELHI BENCH BENCH BENCH BENCH E EE E : NEW DELHI : NEW DELHI : NEW DELHI : NEW DELHI BEFORE SHRI G. BEFORE SHRI G. BEFORE SHRI G. BEFORE SHRI G.D.AGRAWAL, D.AGRAWAL, D.AGRAWAL, D.AGRAWAL, VICE PRESIDENT AND VICE PRESIDENT AND VICE PRESIDENT AND VICE PRESIDENT AND SHRI SHRI SHRI SHRI RAJPAL YADAV RAJPAL YADAV RAJPAL YADAV RAJPAL YADAV, ,, , JUDICIAL MEMBER JUDICIAL MEMBER JUDICIAL MEMBER JUDICIAL MEMBER ITA NO ITA NO ITA NO ITA NO. .. .1322/DEL/2013 1322/DEL/2013 1322/DEL/2013 1322/DEL/2013 ASSESSMENT YEAR ASSESSMENT YEAR ASSESSMENT YEAR ASSESSMENT YEAR : : : : 2009 2009 2009 2009- -- -10 1010 10 INCOME TAX OFFICER, INCOME TAX OFFICER, INCOME TAX OFFICER, INCOME TAX OFFICER, WARD WARD WARD WARD- -- -1(1), 1(1), 1(1), 1(1), GURGAON. GURGAON. GURGAON. GURGAON. VS. VS. VS. VS. SHRI NANAK BHA SHRI NANAK BHA SHRI NANAK BHA SHRI NANAK BHATTI, TTI, TTI, TTI, A AA A- -- -1/358, SECTOR 1/358, SECTOR 1/358, SECTOR 1/358, SECTOR- -- -55, 55, 55, 55, SUSHANT LOK SUSHANT LOK SUSHANT LOK SUSHANT LOK- -- -II, II,II, II, GURGAON. GURGAON. GURGAON. GURGAON. PAN : PAN : PAN : PAN : AIJPB4757C. AIJPB4757C. AIJPB4757C. AIJPB4757C. (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI KEYUR PATEL, SR.DR. RESPONDENT BY : SHRI GUNJAN PRASHAD, CIT-DR. ORDER ORDER ORDER ORDER PER G. PER G. PER G. PER G.D.AGRAWAL, D.AGRAWAL, D.AGRAWAL, D.AGRAWAL, VP VPVP VP : : : : THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST THE O RDER OF LEARNED CIT(A), FARIDABAD DATED 26 TH DECEMBER, 2012 FOR THE AY 2009- 10. 2. THE ONLY GROUND RAISED BY THE REVENUE READS AS UNDE R:- I) WHETHER ON FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(A) WAS RIGHT IN RELYING ON THE DOCUMENTS LIKE COPY OF SALE DEED OF AGRICULTURAL LAN D AND COPIES OF BANK ACCOUNT, IN FAVOUR OF THE ASSESSEE, AS THE RE IS NO SANCTITY OF THESE DOCUMENTS SINCE THESE PAPERS HAVE NEITHER BEEN SIGNED NOR DATED BY ANY COVERING NOTE; II) WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF T HE CASE THE LD.CIT(A) WAS RIGHT IN LAW IN DELETING THE A DDITION OF RS.18,95,060/- MADE BY THE AO ON ACCOUNT OF UNEXPLAINED CASH DEPOSITS IN BANK ACCOUNTS IGNORING TH E FACT THAT THE NEXUS BETWEEN THE AMOUNTS DEPOSITED AND WITHDRAWN FROM THE BANK WAS NOT PROVED BY THE ASSESSEE; ITA-1322/DEL/2013 2 3. WE HAVE HEARD THE ARGUMENTS OF BOTH THE SIDES AND P ERUSED THE MATERIAL PLACED BEFORE US. WE FIND THAT LEARNED CIT (A) HAS DISCUSSED THIS ISSUE AT LENGTH AND HE HAS CONSIDERED EACH AND EVER Y DEPOSIT IN THE BANK ACCOUNT AND, AFTER BEING SATISFIED WITH THE SAME, DELETED THE ADDITION OF ` 18,95,060/-. FOR READY REFERENCE, THE RELEVANT FIN DING OF LEARNED CIT(A) IS REPRODUCED BELOW:- 6.2 GROUND NO.4 OF APPEAL RELATES TO THE ADDITION O F RS.18,95,060/- ON ACCOUNT OF CASH DEPOSITS IN THE BANK ACCOUNT OF THE ASSESSEE WITH ICICI BANK. CONSIDERING TH E DOCUMENTS FILED BEFORE THE AO, THERE IS NO DISPUTE TO THE FACT THAT THE APPELLANT SOLD HIS AGRICULTURAL LAND VI DE SALE DEED REGISTERED ON 02.09.2008 AND RECEIVED CHEQUE NO.670736 AMOUNTING TO RS.3,50,000/- AND CHEQUE NO.670738 AMOUNTING TO RS.9,00,000/-, WHICH WERE DEPOSITED IN HIS BANK ACCOUNT NO.5287 WITH INDIAN OVERSEAS BANK ON 04.09.2008. A COPY OF SAID BANK ACCOUNT WAS FILED BEFORE THE AO. THUS, 2 CHEQUES AMOUNTING TO RS.12,50,000/- WERE CREDITED IN INDIAN OVERSEAS BANK ACCOUNT ON 04.09.2008 AND THEREAFTER, T HE CASH AMOUNTING TO RS.12,40,000/- WAS WITHDRAWN ON 29.09.2008. ON THE SAME DATE, THE CASH OF RS.9,50,000 /- WAS DEPOSITED IN HIS ICICI SAVING BANK ACCOUNT NO.017701002778. WHEN THE CASH HAS BEEN WITHDRAWN FROM ONE BANK ACCOUNT AND DEPOSITED IN OTHER BANK ACCOUNT ON THE SAME DAY, THERE IS NO REASON WHY SUCH CASH DEPOSIT SHOULD BE TREATED AS FROM UNEXPLAINED SOURCES. THE SOURCE OF SUCH CASH IS ALREADY EXPLAINED FR OM THE RECORDS AND THE AO WAS TOTALLY UNJUSTIFIED IN MAK ING ADDITION TO THAT EXTENT. IT IS FURTHER SEEN THAT CA SH AMOUNTING TO RS.2,20,000/- WAS DEPOSITED ON 14.03.2009 IN THE SAME BANK ACCOUNT WITH ICICI BANK WHICH IS EXPLAINED TO BE OUT OF EARLIER WITHDRAWAL OF CASH O N 29.09.2008 FROM BANK ACCOUNT WITH INDIAN OVERSEAS BAN K. THERE ARE NO MUCH TRANSACTIONS OF CASH DEPOSIT AND WITHDRAWALS IN HIS BANK ACCOUNT WITH INDIAN OVERSEAS BA NK EXCEPT THE CASH WITHDRAWAL OF RS.12.40 LACS DISCUSSED ABOVE. THE CASH OF RS.1,20,000/- HAS BEEN DEPOSITED IN THIS BANK ACCOUNT ON 08.05.2008 BUT PRIOR TO THAT ON 07.05.2008, CASH OF RS.1,00,000/- HAS BEEN WITHDRAWN. THE CASH OF RS.27,500/-, RS.80,000/- AND RS.40,000/-, I N ITA-1322/DEL/2013 3 AGGREGATE, HAS BEEN WITHDRAWN FROM THE ICICI BANK ACCOUNT ON 16.06.2008, 16.07.2008 AND 20.09.2008, RESPECTIVELY. THERE ARE SEVERAL OTHER WITHDRAWALS ON VARIOUS DATES WHICH I DO NOT WISH TO QUANTIFY. IT REM AINS AN ADMITTED FACT THAT THE APPELLANT HAS SHOWN COMMISSIO N INCOME OF RS.1,90,000/-, AGRICULTURAL INCOME OF RS.1,50,000/- AND BUSINESS INCOME OF ABOUT RS.1,46,000/- AGGREGATING TO RS.4,86,000/-. CONSIDERING THE WITHDR AWALS OF RS.12,40,000/- FROM INDIAN OVERSEAS BANK ACCOUNT AN D RS.2,47,500/- FROM THE ICICI BANK ACCOUNT AS NARRATED ABOVE, THE CASH DEPOSITS TO THE EXTENT OF RS.14,87,500/ - IS CLEARLY EXPLAINED FROM THE BANK ACCOUNTS DURING THE YEAR ITSELF. THE DIFFERENCE OF RS.4,07,560/- (I.E. RS.18,9 5,060/- MINUS RS.14,87,500/-) IS EXPLAINABLE FROM THE INCOME O F RS.4,86,000/- SHOWN BY THE APPELLANT DURING THE YEAR EVEN AFTER TAKING INTO ACCOUNT VARIOUS PERSONAL EXPENSES OF THE APPELLANTS FAMILY WHILE ALTOGETHER CONSIDERING THE EXPENSES INCURRED THROUGH CREDIT CARD TO THE EXTENT O F RS.1,96,970/-. THE OVERALL ANALYSIS, THEREFORE, SHOWS T HAT THE ENTIRE CASH DEPOSIT IN HIS BANK ACCOUNT WAS EXPLAIN ED HAD THE AO PREPARED A CASH FLOW STATEMENT AFTER TAKIN G INTO ACCOUNT TRANSACTIONS IN BOTH THE BANK ACCOUNTS FI LED BEFORE HIM EVEN IF THE APPELLANT, BEING A SMALL BUSINESSMAN, WAS NOT CONVERSANT WITH THE INTRICACIES OF INCOME TAX LAW. IN THESE FACTS WHEN THE CASH DEPOSIT I S EXPLAINED OUT OF EARLIER CASH WITHDRAWALS, THE BURDEN OF PROOF IS ON THE AO TO BRING MATERIAL ON RECORD TO S HOW THAT THE MONEY WITHDRAWN EARLIER HAD BEEN UTILIZED/INVEST ED ELSEWHERE, OTHERWISE, THE EXPLANATION OF THE ASSESSEE IS TO BE ACCEPTED. THE ACTION OF THE AO IN MAKING SUCH UNWARRANTED ADDITION WITHOUT APPRECIATING THE FACTS AND EVIDENCES PLACED BEFORE HIM BY THE APPELLANT DOES NOT SERVE ANY PUBLIC PURPOSE MUCH LESS THE INTEREST OF REVENUE. IN VIEW OF THE ABOVE FACTUAL POSITION, THE ADDITION OF RS.18,95,060/- MADE BY THE AO ON ACCOUNT OF UNEXPLAINED CASH DEPOSITS IN THE BANK ACCOUNT WITH IC ICI BANK IS TOTALLY UNJUSTIFIED, UNWARRANTED, NOT BASED ON MATERIAL FACTS AND CONSEQUENTLY DELETED. GROUND NO.4 OF APPEAL IS ALLOWED. 4. LEARNED CIT(A) HAS CONSIDERED THE SOURCE OF EACH A ND EVERY DEPOSIT IN THE ICICI BANK AND BEING SATISFIED WITH THE EXPLANATION OF THE ASSESSEE WITH REGARD TO SUCH SOURCE, HE DELETED THE ADDIT ION. AT THE TIME OF HEARING BEFORE US, THE ABOVE DETAILED FACTUA L FINDING RECORDED ITA-1322/DEL/2013 4 BY THE CIT(A) HAS NOT BEEN CONTROVERTED BY THE REVE NUE. WE, THEREFORE, FIND NO JUSTIFICATION TO INTERFERE WITH T HE ORDER OF LEARNED CIT(A). THE SAME IS SUSTAINED AND THE REVENUES APPEAL IS DISMISSED. 5. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISMISSED . DECISION PRONOUNCED IN THE OPEN COURT ON 7 TH FEBRUARY, 2014. SD/- SD/- ( (( (RAJPAL YADAV RAJPAL YADAV RAJPAL YADAV RAJPAL YADAV) )) ) (G.D.AGRAWAL) (G.D.AGRAWAL) (G.D.AGRAWAL) (G.D.AGRAWAL) JUDICIAL JUDICIAL JUDICIAL JUDICIAL MEMBER MEMBER MEMBER MEMBER VICE PRESIDENT VICE PRESIDENT VICE PRESIDENT VICE PRESIDENT DATED : 07.02.2014 VK. COPY FORWARDED TO: - 1. APPELLANT : INCOME TAX OFFICER, INCOME TAX OFFICER, INCOME TAX OFFICER, INCOME TAX OFFICER, WARD WARD WARD WARD- -- -1(1), GURGAON. 1(1), GURGAON. 1(1), GURGAON. 1(1), GURGAON. 2. RESPONDENT : SHRI NANAK BHATTI, SHRI NANAK BHATTI, SHRI NANAK BHATTI, SHRI NANAK BHATTI, A AA A- -- -1/358, SECTOR 1/358, SECTOR 1/358, SECTOR 1/358, SECTOR- -- -55, 55, 55, 55, SUSHANT LOK SUSHANT LOK SUSHANT LOK SUSHANT LOK- -- -II, GURGAON. II, GURGAON. II, GURGAON. II, GURGAON. 3. CIT 4. CIT(A) 5. DR, ITAT ASSISTANT REGISTRAR