The ACIT, Circle-14, Ahmedabad V. Shri Kapil Brij Mohan, Ahmedabad

ITA 1370/AHD/2011

• Counselvise Citation: [2015] 120 COUNSELVISE.COM (IT) 8643 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 8 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-02-2015
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 20-01-2015
• Assessment Year: 2008-2009
• Appeal Filed On: 11-05-2011
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: DINESH SINGH
• Assessee Lawyers: J M TRIVEDI
• Keywords: Income from undisclosed sources

Judgement Text

, A IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, AHMEDABAD BEFORE SHRI SHAILENDRA KUMAR YADAV, JUDICIAL MEMBER AND SHRI N.S. SAINI, ACCOUNTANT MEMBER ./ ITA NO. 1370/AHD/2011 / ASSESSMENT YEAR: 2008-09 ACIT, CIR.14 AHMEDABAD. VS SHRI KAPIL BRIJ MOHAN A-803, MAHALAXMI COMPLEX MAHALAXMI PANCH RASTA, PALDI AHMEDABAD. PAN: AJWPM 2242 B ! / (APPELLANT) '# ! / (RESPONDENT) REVENUE BY : SHRI DINESH SINGH, SR.DR ASSESSEE(S) BY : SHRI J.M. TRIVEDI / DATE OF HEARING : 20/01/2015 / DATE OF PRONOUNCEMENT: 02/02/2015 $%/ O R D E R PER N.S. SAINI, ACCOUNTANT MEMBER: THIS IS AN APPEAL FILED BY THE REVENUE AGAINST THE ORDER OF THE COMMISSIONER O F INCOME-TAX (APPEALS)-XXI, AHMEDABAD DATED 22.2.2011. 2. THE REVENUE HAS TAKEN THE FOLLOWING GROUNDS OF T HE APPEAL: 1. THE LD.CIT(A) HAS ERRED IN LAW AND ON FACTS IN DELETING THE ADDITION ON ACCOUNT OF UNEXPLAINED CASH DEPOSITS OF RS.11,81,500/- AND ON ACCOUNT OF UNEXPLAINED LOAN T RANSACTIONS OF RS.8,04,000/-. 2. THE LD.CIT(A) HAS FAILED TO TAKE INTO CONSIDERAT ION THE REASONS/GROUNDS ON THE BASIS OF WHICH, THE SO CALLE D DISALLOWANCE WERE MADE BY THE AO AND AS DISCUSSED IN DETAIL BY T HE AO IN THE ASSESSMENT ORDER DATED 31.12.2010. ITA NO.1370/AHD/2011 2 3. THE APPELLANT CRAVES LEAVE TO AMEND OR ALTER ANY GROUND OR ADD A NEW GROUND WHICH MAY BE NECESSARY. 3. THE BRIEF FACTS OF THE CASE ARE THAT THE AO OBSE RVED THAT THE ASSESSEE HAS MADE DEPOSIT OF RS.11,81,500/- IN HIS ICICI BANK A/C.NO.000701059521 DURING THE YEAR. HE REQUIRED T HE ASSESSEE TO EXPLAIN THE SOURCE OF DEPOSIT IN THE SAID BANK ACCO UNT. IN REPLY TO THE SAME, THE ASSESSEE SUBMITTED THAT ON 13.12.2008, TH E ASSESSEE HAS DEPOSITED A CHEQUE OF RS.1,00,000/- RECEIVED FROM K ALESH RATHORE, AND ON THE SAME DATE, THE ASSESSEE HAS ALSO DEPOSITED C HEQUE RECEIVED FROM TARUN SHARMA OF RS.3,50,000/-, INDRESH OJHA OF RS.26,000/- AND HIREN RABARI OF RS.26,000/- AND HIRAL SONI OF RS.50 0/-. THE ASSESSEE HAS ALSO SUBMITTED THAT HE HAS WITHDRAWN RS.3,00,00 0/- ON 3.12.2007 AND RS.50,000/- ON 8.12.2007 FROM THE SAID BANK FOR FAMILY OCCASION OF HIS SISTERS ENGAGEMENT, WHICH DID NOT TAKE PLACE, AND SO RS.3,40,000/- WAS DEPOSITED IN THE BANK ON 9.2.2008. THE AO DID NOT ACCEPT THE SUBMISSION OF THE ASSESSEE FOR THE REASONS AS UNDER : (A) THE ASSESSEE IS A SALARIED EMPLOYEE AND HAVING BANK ACCOUNTS. HE IS RESIDING IN A CITY LIKE AHMEDABAD A ND ALSO HAVING CREDIT CARD WHICH CAN BE OF USE IN CASES OF EMERGEN CY OR WHEN ONE IS NOT CARRYING SUFFICIENT CASH WITH HIM. ALSO ATM CARDS ARE MOSTLY USED BY THOSE HAVING BANK ACCOUNTS SO AS TO WITHDRAW CASH FROM ANY OF THE ATM COUNTERS NEARBY. (B) IT IS, THEREFORE, NOT UNDERSTOOD AS TO WHY ASSE SSEE REQUIRES SO MUCH CASH RUNNING INTO LACS AT HIS HOME. THERE IS N O REPLY TO THIS PARTICULAR QUESTION AND NO VALID REASON APPARENTLY FOR WHICH THE ASSESSEE IS RESORTING TO THIS PRACTICE. (C) THE ASSESSEE HAS DEPOSITED THIS MUCH CASH IN HI S. BANK ACCOUNT AN APPARENTLY HE IS NOT ABLE TO EXPLAIN THE SOURCE OF THE SAME. THE REPLY THAT THE CASH WAS WITHDRAWN EARLY A ND THEN DEPOSITED IN BANK WHEN REQUIRED, DOES NOT CARRY WEI GHT IN VIEW OF NO JUSTIFIED REASON OFFERED BY THE ASSESSEE. (D) THERE IS NO VALID REASON FOR KEEPING IDLE MONEY TO THE TUNE OF LACS OF RUPEES BY A PERSON WHEN IT CAN EASILY AND S AFELY KEPT IN A ITA NO.1370/AHD/2011 3 BANK OR INVESTED IN ANY OTHER ASSET WHICH WILL EARN SOME MONEY OR APPRECIATION IN VALUE (E) THE WITHDRAWALS MADE BY THE ASSESSEE ARE NORMAL LY USED AND THE AMOUNT IS WITHDRAWN ONLY WHEN REQUIRED AND EVEN WHEN DEPOSITS ARE MADE IN BANK ACCOUNTS, THERE IS SOME V ALID REASONS. (F) IT IS ALSO SEEN THAT ON ONE SIDE THE ASSESSEE C LAIMS TO HAVE SO MUCH SPARE CASH WITH HIM AT ANY MOMENT AND AS PER S O CALLED CASH BOOK PRODUCED BY HIM, HE IS HAVING AN OPENING CASH BALANCE AS ON 1.4.2007 OF RS.22,14,232/-AND CLOSING BALANCE AS ON 31.3.2008 OF RS.23,74,032/-. THIS IS SIMPLY NOT POSSIBLE FOR ANY PRUDENT MAN TO KEEP THIS MUCH CASH IDLE AT HOME . THEREFORE, HE ADDED RS.11,81,500/- TO THE INCOME OF THE ASSESSEE, AS THE INCOME FROM UNDISCLOSED SOURCES. 4. SIMILARLY, IN THE SHOW CAUSE NOTICE, THE AO REQU IRED THE ASSESSEE TO GIVE COMPLETE DETAILS OF THE LOAN GIVEN AND TAKE N WITH IDENTITY, CAPACITY AND GENUINENESS OF THE TRANSACTION. THE A SSESSEE FILED CONFIRMATION AND PANS OF THE PERSONS FROM WHOM THE LOAN WERE TAKEN, WHICH ARE AS FOLLOWS: '1. I ENCLOSED HEREWITH DETAILS OF FOLLOWING PA RTY CONFIRMATION WITH COPY OF PAN, WHICH ARE AS UNDER:- PARTY NAME PAN KALPESH SURESHBHAI RATHOD AHQPR5455H HIRAN RABARI AJQPR4663P RASHMI DESAI AKAPD7914L INDRAKUMAR OJHA AAHOP1488K TEHAS SONI BGEPS6147K PRATIK DARJI A3ZPD2193F KALPIT PATEL APUPP6223K ITA NO.1370/AHD/2011 4 (III) IT IS, HOWEVER, NOTICED THAT THE BANK ACCOUNT OF THE ASSESSEE WITH ICICI BANK A/C NO. 000701059521 IS SHOWING A D IFFERENT PICTURE AS IT IS OBSERVED THAT THERE ARE SO MANY CA SH DEPOSITS IN THIS ACCOUNT OF THE ASSESSEE ON VARIOUS DATES IN TH E NAME OF VARIOUS PERSONS INCLUDING SOME OF THOSE MENTIONED B Y THE ASSESSEE. THE NAMES AND AMOUNTS ARE AS UNDER:- DATE NAME AMOUNT (RS) 4.4.2007 TARUN MEHTA 1,00,000 24.8.2007 TARUN SHARMA 1,25,000 17.12.2007 KALPIT/HIREN 3,00,000 - 24.01.2008 TARUN 2,00,000 13.02.2008 KALPESH RATHOD 1,00,000 13.0.22008 TARUN SHARMA 4,02,500 14.0.2008 PRATIK DARJI 26,000 14.2.2008 SANJAY 26,000 14.2.2008 TEJAS SONI 26,000 19.2.2008 NIRUBEN GAJJAR 26,000 27.3.2008 NEHA SHARMA 1,00,000 27.3.2008 ARCHANA SHARMA 1,10,000 17,27,500 5. THE AO OBSERVED THAT WHEN REQUIRED TO GIVE DETAI LS OF THE LOANS TAKEN, THE ASSESSEE HAS GIVEN DETAILS ONLY SHRI TAR UN SHARMA AND WHERE HE WAS ASSESSED TO TAX. FOR WANT OF COMPLETE INFORMATION, THE AO HELD THAT THE IDENTITY, CAPACITY AND GENUINENESS OF THE TRANSACTION WAS NOT PROVED BY THE ASSESSEE, WHICH ONUS, LIES ON THEM. HE, THEREFORE, HELD THAT HE HAS NO OPTION, BUT TO TREAT THESE DEPOSITS AS NOT ITA NO.1370/AHD/2011 5 GENUINE, AND HELD THEM TO BE UNDISCLOSED INCOME OF THE ASSESSEE. HE OBSERVED THAT THE TOTAL DEPOSITS ARE OF RS.17,27,50 0/-, OUT OF WHICH, AN AMOUNT OF RS.7,27,500/- WAS IN THE NAME OF SHRI TAR UN SHARMA, WHO IS ASSESSED TO TAX IS GENUINE, AND THE BALANCE AMOUNT OF RS.10,00,000/- WAS NOT GENUINE, AND ADDED THE SAME TO THE INCOME O F THE ASSESSEE. 6. ON APPEAL, THE CIT(A) DELETED THE ADDITION BY OB SERVING AS UNDER: UNEXPLAINED CASH DEPOSIT RS.11,81,500/- THE REASONS OF AO ARE CONTAINED IN PARA 4 ON PAGE N O.1 TO 3 O THE ASSESSMENT ORDER. THE REPLY/SUBMISSIONS OF THE ASS ESSEE HAVE BEEN REPRODUCED IN ASSESSMENT ORDER. I HAVE GONE T HROUGH THE SAME. IT CAN BE OBSERVED FROM THE DETAILS SUBMITTED THAT OUT OF RS.L1,81,5007- RS.100000/- DEPOSITED ON 13.2.08 IS BY CHEQUE AS WELL AS RS.4,02,500/- DEPOSITED ON 13.2.08 IS ALSO BY CHEQUE RS. 100000/- WERE RECEIVED FROM SHRI KALPESH RATHORE TH OUGHT CHEQUE AS WELL AS RS.4,02,500-- WERE RECEIVED BY CH EQUE AS UNDER. SHRI TARUN SHARMA RS.3,50,000/- SHRI INDRESH OJHA RS. 26,000/- SHRI HIREN RABARI RS. 26,000/- SHRI HIREN SONI RS. 500/- ---------------- RS.4,02,500/- ========= 5.1 THUS A.O.'S VERSION THAT ENTIRE RS.11,81 ,500/- IS BY CASH IS NOT ACCEPTABLE AND APPEARS TO BE WITHOUT VERIFIC ATION OF FACTS OR INQUIRY. 6. THE APPELLANT HAD ALSO PRODUCED BEFORE A.O.'S C ASHBOOK AND SAME IS ALSO PLACE ON RECORD FOR THE ACCOUNTING PER IOD 1.4.07 TO 31.3.08 RELEVANT TO ASST. YEAR 08-09. IT CAN BE OBS ERVED FROM THE SAME THAT THERE WAS OPENING CASH AS ON 1.4.07 OF RS .22,14,232/- . THE A.O. HAS NOT ACCEPTED CASH BOOK ON FILLING GR OUND AND PRESUMPTION AND NOT SUPPORTED HIS OBSERVATION/FINDI NG ON ANY BASE. AGAIN IT IS TO BE NOTED THAT APPELLANT HAD WI TH DRAWN CASH OF RS.3,00,000/- FROM BANK ON 3.12.07 AND RS.50,000/- ON 8.12.07 FOR FAMILY OCCASION OF HER SISTER'S ENGAGEMENT BUT AS SAME COULD ITA NO.1370/AHD/2011 6 NOT MATERIALIZE OUT OF SAID WITHDRAW OF RS.3,50,000 /- RS.3,40,000/- WERE DEPOSITED IN BANK ON 09.2.08. TH E REASONING OF A.O. FOR NOT ACCEPTING THIS TRANSACTION ARE AGAI N ON PRESUMPTION AND ON THE PREMISES NOT TAXABLE IN LAW, WITHOUT BRINGING ANY EVIDENCE ON RECORD TO REJECT ASSESSEE' S CONTENTION. WHETHER TO USE ATM AND CREDIT CARD OR NOT IS NOT CH OICE OF DEPARTMENT. THE REMAINING AMOUNT CAN REASONABLY SAI D TO BE COVERED IN OPENING BALANCE OF CASH ON 1.4.07 THUS I AM OF THE VIEW THAT WITHOUT BRINGING ANY ADEQUABLE EVIDENCE O N RECORD, EXPLANATION OF APPELLANT CANNOT BE REJECTED ON SURM ISES AND PRESUMPTIONS, WHEN THESE TRANSACTION APPEAR IN CASH BOOK. I AM OF THE VIEW THAT ADDITION OF RS.11,81,500/- IS REQU IRED TO BE DELETED AND I HEREBY DELETE THE SAME. 7. UN DISCLOSED INCOME OUT OF LOAN TRANSACTION RS. 10,00,000/- :- THE A.O.'S OBSERVATION ARE IN PARA 5 ON PAGE 3 TO 5 OF ASSESSMENT ORDER. THE ASSESSEE'S REPLY IS ALSO REPRODUCED IN A SST. ORDER, I HAVE GONE THROUGH THE SAME. ON PAGE 4 OF THE ASST. ORDER, A.O. STATES THAT THER E ARE LOAN TRANSACTION OF RS.17,27,500/- AND ACCORDING TO HIM ' DEPOSITS IN THE NAME OF TARUN SHARMA TOTALING TO RS.7,27,500/- STANDS EXPLAINED AS HE IS ASSESSED TO TAX. THE ASSESSEE CO NTENDS THAT TOTAL OF AMOUNT IN THE NAME OF TARUN SHARM IS OF RS .8,27,500/-. SINCE AT ONE PLACE A.O. HAS TYPED NAME OF TARUM SHA RAM AS TARUN MEHTA AND HENCE MORE RELIEF OF RS.100000/- IN THE NAME OF TARUN SHARMA REQUIRES TO BE GIVEN. THE EXPLANATION OF THE ASSESSEE APPEARS TO BE REASONABLE / PLAUSIBLE AND H ENCE I DIRECT TO DELETE THE ADDITION OF RS.100000/- ON THIS COUNT . 7. BEING AGGRIEVED, THE REVENUE IS IN APPEAL BEFORE US. 8. BOTH PARTIES ADMITTED BEFORE US THAT THE ISSUES REQUIRE TO BE RESTORED BACK TO THE FILE OF THE AO FOR PROPER VERI FICATION, AND THEREAFTER, ADJUDICATION AFRESH. WE, THEREFORE, SE T ASIDE THE ORDERS OF THE LOWER AUTHORITIES, AND RESTORE THE MATTER BACK TO THE FILE OF THE AO FOR FRESH ADJUDICATION AFTER PROPER VERIFICATION BY PASSING A SPEAKING ORDER. NEEDLESS TO MENTION, HE SHALL ALLOW REASONA BLE AND PROPER OPPORTUNITY OF HEARING TO THE ASSESSEE BEFORE ADJUD ICATING THE ISSUE ITA NO.1370/AHD/2011 7 AFRESH. THESE GROUNDS OF THE APPEAL OF THE REVENUE ARE ALLOWED FOR STATISTICAL PURPOSE. 9. IN THE RESULT, THE APPEAL OF THE REVENUE ARE ALL OWED FOR STATISTICAL PURPOSE. ORDER PRONOUNCED IN THE COURT ON MONDAY, THE 2 ND FEBRUARY, 2015 AT AHMEDABAD. SD/- SD/- ( SHAILENDRA KUMAR YADAV ) JUDICIAL MEMBER ( N.S. SAINI) ACCOUNTANT MEMBER AHMEDABAD; DATED 02/02/2015 $% & ''() *$)' / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ! / CONCERNED CIT 4. ! ( ) / THE CIT(A)-III, AHMEDABAD 5. $%& '' , , )*++ / DR, ITAT, AHMEDABAD 6. &,- . / GUARD FILE. $% + / BY ORDER, TRUE COPY ,/ - ( DY./ASSTT.REGISTRAR) , / ITAT, AHMEDABAD 1. DATE OF DICTATION- 20.01.2015 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER 21.01.2015 3. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR.P. S./P.S. - 4. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE D ICTATING MEMBER FOR PRONOUNCEMENT .. 5. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 02/02/2015 6. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK . 7. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT RE GISTRAR FOR SIGNATURE ON THE ORDER.. 8. DATE OF DESPATCH OF THE ORDER