NAGARAJAN NATARAJAN, PUDUCHERRY V. ITO WARD-5, PUDUCHERRY

ITA 1449/CHNY/2019

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 3725 (ITAT-CHENNAI)
• Duration Of Justice: 9 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-02-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Assessment Year: 2015-2016
• Appeal Filed On: 09-05-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Unexplained cash credit; Salary income; Corroborative evidences
• Section: 68; 143(3)

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH: CHENNAI , . , BEFORE SHRI INTURI RAMA RAO, ACCOUNTANT MEMBER AND SHRI DUVVURU RL REDDY , JUDICIAL MEMBER ./ ITA NO.1449/CHNY/2019 /ASSESSMENT YEAR: 2015-16 SHRI NAGARAJAN NATARAJAN, NO. 16, JAMINDAR GARDEN, PUDUCHERRY 605 001. [PAN: ADAPN9083D] VS. INCOME TAX OFFICER, WARD 3, PUDUCHERRY. ( /APPELLANT) ( /RESPONDENT) / APPELLANT BY : SHRI D. ANAND, ADVOCATE /RESPONDENT BY : MS. R. ANITA, JCIT /DATE OF HEARING : 11.02.2020 /DATE OF PRONOUNCEMENT : 26.02.2020 / O R D E R PER DUVVURU RL REDDY , JUDICIAL MEMBER : THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE LD. COMMISSIONER OF INCOME TAX (APPEALS)-PUDUCHERRY, PUDUCHERRY DATED 18.03.2019 RELEVANT TO THE ASSESSMENT YEAR 2015-16. THE EFFECTIVE GROUND RAISED IN THE APPEAL OF THE ASSESSEE IS THAT DESPITE RAISING SPECIFIC GROUND, THE LD. CIT(A) HAS NOT ADJUDICATED ON THE ADDITION TOWARDS UNEXPLAINED DEPOSIT OF .9,50,000/- MADE UNDER SECTION 68 OF THE INCOME TAX ACT, 1961 [ACT IN SHORT]. 2. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE HAS NOT FILED HIS RETURN OF INCOME FOR THE ASSESSMENT YEAR 2015-16. SINCE CASH TRANSACTIONS/DEPOSITS :- 2 -: ITA NO.1449/CHNY/19 WERE FOUND TO BE EXCESS, VIDE LETTER DATED 28.12.2016, THE CBDT HAS CALLED FOR CLARIFICATION. THE ASSESSEE FILED HIS RETURN OF INCOME ON 21.03.2017 (WHICH WAS CLAIMED TO BE IN RESPONSE TO THE LETTER). THE SAID ORIGINAL RETURN WAS REVISED THROUGH ANOTHER RETURN OF INCOME FILED ON 31.03.2017. THE MAIN DIFFERENCE IN THE TWO RETURNS IS THAT THE INCOME FROM BUSINESS IS ENHANCED FROM .5,89,872/- TO .7,93,248/-. THERE WAS ALSO A REVISION OF INCOME UNDER THE HEAD INCOME FROM OTHER SOURCES FROM .68,862/- TO .98,421/-. APART FROM THESE, THE INCOME FROM SALARY OF .1,85,600/- AND LOSS FROM HOUSE PROPERTY OF .35,567/- ARE SAME IN BOTH THE RETURNS. THE ASSESSING OFFICER COMPLETED THE ASSESSMENT UNDER SECTION 143(3) OF THE ACT BY ASSESSING THE TOTAL INCOME AT .1,31,96,753/- BY MAKING AN ADDITION TO THE TUNE OF .1,31,08,299/- AS UNEXPLAINED CASH CREDIT UNDER SECTION 68 OF THE ACT AND ALSO DISALLOWED ASSESSEES CLAIM OF LOSS FROM HOUSE PROPERTY. ON APPEAL, AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE, THE LD. CIT(A) DELETED THE ADDITION TO THE EXTENT OF .1,16,48,850/- AND CONFIRMED THE ADDITION TO THE EXTENT OF .14,59,449/-. 3. ON BEING AGGRIEVED, THE ASSESSEE IS IN APPEAL BEFORE THE TRIBUNAL WITH REGARD TO THE ADDITION OF .9,50,000/-. THE LD. COUNSEL FOR THE ASSESSEE HAS SUBMITTED THAT THE ASSESSEE HAS RAISED SPECIFIC GROUND BEFORE THE LD. CIT(A) WITH REGARD TO THE ADDITION OF .9,50,000/- BY FILING SUPPORTING EVIDENCES AND HOWEVER, THE LD. CIT(A) HAS NOT ADJUDICATED THE GROUND RAISED BY THE ASSESSEE. WHILE REITERATING THE SUBMISSIONS AS MADE BEFORE THE LD. CIT(A), IT WAS THE SUBMISSION OF THE LD. COUNSEL THAT THE ASSESSEE AND HIS WIFE :- 3 -: ITA NO.1449/CHNY/19 SUBSCRIBED TO CHIT FUND WITH M/S. THIRIPIRA CHITS PVT. LTD., PUDUCHERRY AND ON MATURITY OF THE CHIT FUND, THE AMOUNTS RECEIVED BY WAY OF CHEQUE FROM THE CHIT FUND COMPANY WERE DEPOSITED IN THE IDBI BANK. BY FILING COPY OF THE BANK STATEMENT, CHIT PASS BOOK, THE LD. COUNSEL FOR THE ASSESSEE PRAYED FOR DELETING THE ADDITION ON MERITS. ON THE OTHER HAND, THE LD. DR FAIRLY CONCEDED THAT THE ISSUE MAY BE REMITTED BACK TO THE FILE OF THE LD. CIT(A) FOR ADJUDICATION. 4. WE HAVE HEARD BOTH THE SIDES, PERUSED THE MATERIALS AVAILABLE ON RECORD AND GONE THROUGH THE ORDERS OF AUTHORITIES BELOW. DESPITE REPRODUCING THE GROUNDS OF APPEAL IN THE APPELLATE ORDER AT PAGE 3, WE FIND THAT THE LD. CIT(A) HAS NOT ADJUDICATED THE SPECIFIC GROUND RAISED IN GROUND NO. VIII) A.O. ERRED IN NOT ACCEPTING THE DEPOSIT OF .9.50 LAKHS AS RECEIVED FROM THE CHIT FUND BESIDES RECORDING THE ASSESSEES SUBMISSION AT PAGE 8. WITH REGARD TO THE DEPOSIT, IN THE ASSESSMENT ORDER, THE ASSESSING OFFICER HAS OBSERVED THAT .9,50,000/- WAS DEPOSITED IN THE IDBI BANK ACCOUNT BY WAY OF CHEQUE. SINCE SUPPORTING EVIDENCE ON THE RECEIPT OF THE SUM WAS NOT PRODUCED, THE ASSESSING OFFICER DISALLOWED THE SAME AND BROUGHT TO TAX. AS HAS BEEN EXPLAINED BEFORE THE LD. CIT(A) BY FILING COPY OF THE BANK STATEMENT, CHIT PASS BOOK OF THE M/S. THIRIPIRA CHITS PVT. LTD. AND ALSO FILING COPIES OF THE ABOVE EVIDENCES BEFORE THE TRIBUNAL, THE LD. COUNSEL FOR THE ASSESSEE HAS SUBMITTED THAT THE SAID AMOUNT OF .9,50,000/- IS THE MATURITY AMOUNT RECEIVED FROM M/S. THIRIPIRA CHITS PVT. LTD., PUDUCHERRY JOINTLY SUBSCRIBED BY THE ASSESSEE AND HIS WIFE, WHICH WAS REMITTED TO ASSESSEES IDBI BANK ACCOUNT BY WAY OF CHEQUE :- 4 -: ITA NO.1449/CHNY/19 AND THUS, PRAYED FOR DELETING THE ADDITION. ON PERUSAL OF THE CHIT PASS BOOK OF M/S. THIRIPIRA CHITS PVT. LTD., PUDUCHERRY, WE FIND THAT THE ASSESSEE AND HIS WIFE WERE SUBSCRIBED TO THE CHIT FUND FROM AUGUST, 2012 ONWARDS AND ON MATURITY OF THE CHIT FUNDS ON 20.03.2014, THE AMOUNTS [.4,75,000 + .4,75,000] WERE PAID TO THE ASSESSEE BY WAY OF CHEQUES AND THE SAME WERE DEPOSITED IN IDBI ACCOUNT. ONCE THE ASSESSEE HAS PRODUCED CLEAR EVIDENCE OF SUBSCRIPTION TO THE M/S. THIRIPIRA CHITS PVT. LTD., PUDUCHERRY AND THE AMOUNTS RECEIVED IN THE FORM OF CHEQUES WERE ALSO DEPOSITED IN IDBI BANK ACCOUNT, THE ADDITION OF .9,50,000/- MADE BY THE ASSESSING OFFICER STANDS DELETED. 5. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED ON THE 26 TH FEBRUARY, 2020 AT CHENNAI. SD/- SD/- (INTURI RAMA RAO) ACCOUNTANT MEMBER (DUVVURU RL REDDY) JUDICIAL MEMBER CHENNAI, DATED, THE 26.02.2020 VM/- /COPY TO: 1. / APPELLANT, 2. / RESPONDENT, 3. ( ) /CIT(A), 4. /CIT, 5. /DR & 6. /GF.