Shri Tanmoy Chatterjee, Howrah V. ITO, Ward 48(2), Kolkata

ITA 1434/KOL/2009

• Counselvise Citation: [2010] 136 COUNSELVISE.COM (IT) 2469 (ITAT-KOLKATA)
• Duration Of Justice: 11 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-07-2010
• Appeal Filed By: Assessee
• Bench Allotted: A
• Next Hearing Date: 23-03-2010
• Assessment Year: 2006-2007
• Appeal Filed On: 19-08-2009
• Court: TRIBUNAL
• Department Lawyers: D R MAJHI
• Assessee Lawyers: R DHAR
• Keywords: Unexplained investment; Unexplained expenditure; Peak credit
• Section: 69C; 143(3)

Judgement Text

, , , IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH : KOLKATA () . . , , ! .'#. , $% [BEFORE SRI B. R. MITTAL, JM & SRI C. D. RAO , AM] !& !& !& !& / ITA NO.1434 /KOL/2009 '( )* '( )* '( )* '( )*/ // / ASSESSMENT YEAR : 2006-07 TANMOY CHATTERJEE -VS- INCOME-TAX OFFICER, WD- 48(2), KOLKATA. (PA NO. AGBPC 6461 C) CIRCLE-36, KOLKATA. (,- / APPELLANT ) (./,-/ RESPONDENT ) FOR THE APPELLANT: : 0 /SRI R. DHAR FOR THE RESPONDENT 0 /SRI D. R. MAJHI $1 / ORDER PER B. R. MITTAL, ( . . . . . . . . ) )) ), , , , ) : THE ASSESSEE HAS FILED THIS APPEAL FOR ASSESSMENT Y EAR 2006-07 AGAINST THE ORDER OF LD. CIT(A) DATED 23 RD JUNE, 2009 ON THE FOLLOWING GROUNDS : 1. FOR THAT LD. CIT(A) WAS NOT JUSTIFIED IN CONFIR MING ADDITION OF RS.49,00,000/-, ALLEGEDLY ADDED BY LD. ITO, WD-48(2), KOLKATA U/S. 60H OF THE I. T. ACT, 1961, BASED ON SURMISE ONLY. 2.FOR THAT LD. CIT(A), ACTED BEYOND HIS JURISDICTIO N WHEN HE ENHANCED THE ADDITION BY RS.9,000/-. 3. FOR THAT LD. CIT(A) HAD NO JURISDICTION TO DIRE CT THE LD. ITO TO ADD RS.49,09,000/- U/S. 69A OF THE I. T. ACT, 1961. 4. FOR THAT LD. CIT(A) SHOULD HAVE QUASHED THE ASSE SSMENT ORDER MADE U/S. 143(3) OF THE I. T. ACT, 1961 DATED 31.12.2009 BASED ON SUSPI CION & SURMISE ONLY, WHICH WAS ALSO BARRED BY LIMITATION. 2. FIRST WE TAKE UP GROUND NO. 4 OF THE APPEAL AS I T GOES TO THE VALIDITY OF THE ASSESSMENT ORDER. 2.1. THE AO COMPLETED THE ASSESSMENT VIDE ORDER DAT ED 31 ST DECEMBER, 2008. THE LD. AR HAS CONTENDED THAT THE ASSESSMENT ORDER WAS RECEIVED BY THE ASSESSEE ON 20 TH JANUARY, 2009 AND AS SUCH THE ASSESSMENT ORDER IS B ARRED BY LIMITATION. 2.2. WE HAVE HEARD THE LD. REPRESENTATIVES OF THE P ARTIES. THERE IS NO DISPUTE THAT THE FACT THAT THE AO COULD COMPLETE THE ASSESSMENT UPTO 31 ST DECEMBER, 2008. WE 2 OBSERVE THAT THE ASSESSMENT ORDER IS DATED 31 ST DECEMBER, 2008 AND ADMITTEDLY THE ASSESSMENT ORDER WAS RECEIVED BY THE ASSESSEE ON 20 TH JANUARY, 2009 (THE DATE OF 31 ST DECEMBER, 2009 AS MENTIONED IN THE GROUND OF APPEAL APPEARS TO BE A TYPOGRAPHICAL MISTAKE AND THE SAME SHOULD BE READ AS 31 ST DECEMBER, 2008). WE ARE OF THE CONSIDERED VIEW THAT THE 20 DAYS TIME TAKEN FOR SERVICE OF ASS ESSMENT ORDER TO THE ASSESSEE IS REASONABLE AND NO PRESUMPTION CAN BE DRAWN THAT THE ASSESSMENT ORDER DATED 31 ST DECEMBER, 2008 IS BACK DATED AS CONTENDED BY THE LD . AR. THE LD. AR HAS ALSO NOT BROUGHT ANY MATERIAL ON RECORD TO SUBSTANTIATE HIS PRESUMPTION THAT THE ASSESSMENT ORDER WAS PASSED NOT ON 31 ST DECEMBER, 2008 BUT TO A SUBSEQUENT DATE. HENCE, W E REJECT THE GROUND NO. 4 OF THE APPEAL TAKEN BY THE ASSESSEE. 3 GROUND NOS. 1 TO 3 OF THE APPEAL ARE INTERCONNECT ED. THE RELEVANT FACTS ARE THAT THE AO DURING THE COURSE OF ASSESSMENT PROCEEDINGS OBSERVED THAT THE ASSESSEE HAD NO BUSINESS BUT HUGE AMOUNT WAS DEPOSITED AND/OR WITHD RAWAL FROM THE BANK ACCOUNT, THE DETAILS OF WHICH ARE GIVEN BY THE AO AT PAGE 3 OF T HE ASSESSMENT ORDER. THE AO CONSIDERING THE TOTAL WITHDRAWALS FROM THE SAID BAN K ACCOUNT AS EXPENDITURE AND TREATED THE SAME AS UNEXPLAINED EXPENDITURE U/S. 69C OF THE ACT. IT IS RELEVANT TO STATE THAT THE AO MADE THE ADDITION OF RS.49,00,000/- BUT IN THE B ODY OF THE ASSESSMENT ORDER, HE HAS STATED THE FIGURE OF RS.42,00,000/- AT ONE PLACE AN D RS.44,00,000/- AT ANOTHER PLACE OF PAGE 3 OF THE ASSESSMENT ORDER. WE AGREE WITH THE L D. AR THAT THE AO HAS MENTIONED THE VARYING FIGURE IN THE ASSESSMENT ORDER BUT, WE ARE OF THE CONSIDERED VIEW THAT THE SAME ARE INADVERTENTLY AND IF READ WITH THE ORDER O F THE LD. CIT(A) THE TOTAL AMOUNT CONSIDERED BY THE AO IS RS.49,00,000/- WHICH HAS BE EN ADDED WHILE COMPLETING THE ASSESSMENT. 3.1. THE ASSESSEE FILED APPEAL BEFORE THE LD. CIT(A ) DISPUTING THE SAID ADDITION OF RS.49,00,000/-. 3.2. THE LD. CIT(A), AT PAGE 3 OF THE IMPUGNED ORDE R HAS GIVEN THE DETAILS OF THE AMOUNT DEPOSITED AND AMOUNT WITHDRAWN BY THE ASSE SSEE IN HIS BANK ACCOUNT WHICH IS AS UNDER : DATE MODE WITHDRAWAL DEPOSIT 16.4.05 6.6.05 7.6.05 8.6.05 CASH CASH CASH CASH - RS.5,00,000/- - - RS.7,00,000/- - RS.8,00,000/- RS.6,00,000/- 3 21.6.05 21.6.05 19.7.05 22.7.05 26.7.05 4.8.05 12.8.05 17.9.05 27.9.05 28.9.05 3.10.05 17.10.05 28.10.05 31.10.05 16.11.05 31.12.05 18.01.06 18.01.06 SELF SELF SELF SELF CASH SELF SELF SELF BY CASH BY CASH SELF BY CASH SELF SELF SELF TRANSFER TRANSFER CC424 SELF RS.5,00,000/- RS.5,00,000/- RS.1,50,000/- RS.3,50,000/- - RS.6,00,000/- RS.3,00,000/- RS. 10,000/- - - RS.1,50,000/- - RS.3,00,000/- RS.5,00,000/- RS. 50,000/- RS.5,09,900/- - RS.5,00,000/- RS.8,00,000/- - - - RS.2,00,000/- RS.2,00,000/- - RS.10,00,000/- - - - - RS.5,09,000/- - 3.3. THE LD. CIT(A) OBSERVED THAT THE SAID BANK AC COUNT WITH FEDERAL BANK IS NOT DISCLOSED BY THE ASSESSEE. THE ENTRIES IN THE BANK ACCOUNTS ARE NOT INCORPORATED IN THE BOOKS OF ACCOUNTS MAINTAINED BY THE ASSESSEE. IT IS OBSERVED THAT THE ASSESSEE CONTENDED THAT THE CASH WITHDRAWAL FROM THE BANK W AS RE-DEPOSITED IN THE BANK ACCOUNT AS THE ASSESSEE COULD NOT UTILIZE THE WITHD RAWAL FUND. THE LD. CIT(A) CONSIDERED THE DEPOSIT OF THE AMOUNT IN THE ABOVE B ANK ACCOUNT AND THE TOTAL COMES TO RS.49,09,000/- AND STATED THAT THESE FUNDS REPRESEN TED UNEXPLAINED MONEY OF THE ASSESSEE AND THUS MADE THE ADDITION U/S. 69A OF THE ACT AS UNEXPLAINED DEPOSIT. HENCE, THE ASSESSEE IS IN FURTHER APPEAL BEFORE THE TRIBUN AL. 3.4. THE LD. AR SUBMITTED THAT THE WITHDRAWAL FROM BANK ACCOUNT COULD NOT BE ASSESSED AS UNEXPLAINED EXPENDITURE. HE FURTHER SU BMITTED THAT THE DEPOSIT IN THE BANK ACCOUNT ALSO COULD NOT BE CONSIDERED AS HARD CASH A ND THUS, THE PROVISION OF SECTION 69A WILL ALSO NOT APPLY. THE LD. AR REFERRED THE DECISI ON OF THE HONBLE APEX COURT IN THE CASE OF CIT VS. KASTURI & SONS LTD. 237 ITR 24 (SC) AND SUBMITTED THAT SECTION 69A REFERRED TO UNEXPLAINED MONEY WHICH COULD BE ONLY T HE HARD CASH AND NOT BANK DEPOSIT AND HENCE, THE PROVISION OF SECTION 69A AS APPLIED BY THE LD. CIT(A) IS NOT JUSTIFIED. THE LD. AR FURTHER SUBMITTED THAT THE LD. CIT(A) HA S ENHANCED THE ADDITION FROM 4 RS.49,00,000/- TO RS.49.09 LACS WITHOUT GIVING NOTI CE TO THE ASSESSEE. THEREFORE, THE ORDER OF THE LD. CIT(A) IS NOT VALID AND THE ADDITI ON SHOULD BE DELETED. 3.5. ON THE OTHER HAND, THE LD.DR RELIED ON THE ORD ER OF THE LD. CIT(A). 3.6. WE HAVE CAREFULLY CONSIDERED THE SUBMISSIONS O F THE LD. REPRESENTATIVES OF THE PARTIES AND THE ORDERS OF THE AUTHORITIES BELOW. W E OBSERVE THAT THE SAID BANK ACCOUNT IS UNDISCLOSED AND THE ENTRIES IN THE SAID BANK ACCOU NT ARE NOT ENTERED IN THE BOOKS OF ACCOUNTS OF THE ASSESSEE. THE ABOVE FACTS HAVE BEE N STATED BY THE LD. CIT(A) AT PAGE 3 OF THE IMPUGNED ORDER AND DURING THE COURSE OF HEAR ING, THE LD. AR HAS NOT DISPUTED BEFORE US. ON PERUSAL OF THE SAID BANK ACCOUNT, WE OBSERVE THAT THERE WERE DEPOSITS AND WITHDRAWALS FROM TIME TO TIME. WE ALSO OBSERVE FRO M THE ORDER OF THE LD. CIT(A) THAT THE ASSESSEE ALSO CONTENDED ABOUT THE PEAK CREDIT I N THE SAID BANK ACCOUNT BUT THE LD. CIT(A) DID NOT ACCEPT THE SAME. 3.7 WE FURTHER OBSERVE THAT THE AO MADE THE ADDITIO N OF RS.49 LAKHS BY OBSERVING THAT THERE WERE UNEXPLAINED EXPENDITURE BY WAY OF W ITHDRAWAL FROM THE SAID BANK ACCOUNT OF RS.42 LAKHS. HOWEVER, ON PERUSAL OF THE DETAILS STATED BY THE AO IN PARA 4 AT PAGE 3 OF THE ASSESSMENT ORDER, THE TOTAL COMES TO RS.49.09 LAKHS. THEREFORE, THE LD. CIT(A) HAS CONSIDERED THE AGGREGATE AMOUNT OF THE D EPOSITS AS RS.49.09 LAKHS AS UNEXPLAINED DEPOSIT U/S. 69A OF THE ACT. WE ARE OF THE CONSIDERED VIEW THAT THE ASSESSEE HAS MADE CASH DEPOSIT AND ALSO CASH WITHDR AWAL FROM TIME TO TIME FROM THE SAID BANK ACCOUNT. THE ASSESSEE HAS ALSO NOT BEEN ABLE TO EXPLAIN THE SOURCE OF DEPOSIT IN THE SAID BANK ACCOUNT. FURTHER, THE DEPARTMENT HAS ALSO NOT BROUGHT ANY EVIDENCE ON RECORD THAT THE SAID CASH WITHDRAWAL HAS BEEN SPENT BY THE ASSESSEE. THEREFORE, WE FIND SUBSTANCE IN THE SUBMISSION OF THE ASSESSEE THAT T HE ASSESSEE MADE WITHDRAWAL FROM THE SAID BANK ACCOUNT AND AGAIN DEPOSITED THE SAME AS T HE ASSESSEE COULD NOT UTILIZE THE WITHDRAWAL AMOUNT FOR THE PURPOSE FOR WHICH IT WAS WITHDRAWN. NO DOUBT THE ASSESSEE HAS NOT STATED ANY WHERE THE PURPOSE FOR WHICH THE AMOUNT WAS WITHDRAWN FROM TIME TO TIME. THE ASSESSEE HAS ALSO PLACED THE BANK STATEM ENT AT PAGE 7 OF THE PAPER BOOK. CONSIDERING THE SAID BANK STATEMENT, THE EXTRACT OF WHICH HAS BEEN GIVEN BY THE LD. CIT(A) AT PAGE 3 OF THE IMPUGNED ORDER, WHICH HAS ALREADY BEEN REPRODUCED HEREINABOVE, WE ARE OF THE CONSIDERED VIEW THAT THE PEAK OF THE BALANCE IN THE SAID BANK ACCOUNT SHOULD BE CONSIDERED AS UNEXPLAINED INVEST MENT U/S. 69 OF THE I. T. ACT. ON PERUSAL OF THE SAID BANK STATEMENT, WE OBSERVE THAT THE PEAK BALANCE AS ON 14 TH JUNE, 5 2005 OF RS.16,15,261/- AND IN THE FACTS AND CIRCUMS TANCES OF THE CASE, THE SAID AMOUNT COULD BE CONSIDERED AS UNEXPLAINED INVESTMENT BY WA Y OF DEPOSIT IN THE SAID UNDISCLOSED BANK ACCOUNT. THEREFORE, WE MODIFY TH E ORDERS OF THE AUTHORITIES BELOW AND RESTRICT THE ADDITION TO RS.16,15,261/- U/S. 69 OF THE I. T. ACT AS AGAINST RS.49.09 LACS U/S. 69A AS SUSTAINED BY THE LD. CIT(A). HENC E, THE GROUND NOS. 1 TO 3 OF THE APPEAL TAKEN BY THE ASSESSEE ARE ALLOWED IN PART. 4. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED IN PART ORDER PRONOUNCED ON 30.7.2010 SD/- SD/- . .. .'# '#'# '#. .. . , , , , $% $% $% $% . . . . . . . . (C. D. RAO) (B. R. MITTAL) ACCOUNTANT MEMBER JUDICIAL MEMBER ( (( (#% #% #% #%) )) ) DATED : 30 TH JULY, 2010 23 '45 6 JD.(SR.P.S.) $1 7 .8 9$8):- COPY OF THE ORDER FORWARDED TO: 1. ,- /APPELLANT - SRI TANMOY CHATTERJEE, BALTIKURI, CH AKPARA, HOWRAH- 113. . 2 ./,- / ITO, WARD-48(2), KOLKATA 3. 1'/ THE CIT, KOLKATA 4. 1' ()/ THE CIT(A), KOLKATA. 5. AB .' / DR, KOLKATA BENCHES, KOLKATA /8 ./ TRUE COPY , $1'C/ BY ORDER , D !5 / DEPUTY REGISTRAR .