G.Malini, CHENNAI V. ACIT, CHENNAI

ITA 1465/CHNY/2013

• Counselvise Citation: [2013] 120 COUNSELVISE.COM (IT) 4708 (ITAT-CHENNAI)
• Duration Of Justice: 3 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-10-2013
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: C
• Assessment Year: 2006-2007
• Appeal Filed On: 01-07-2013
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: T N BETGERI
• Assessee Lawyers: R SIVARAMAN
• Section: 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH : CHENNAI BEFORE DR. O.K. NARAYANAN, VICE PRESIDENT & SHRI VIKAS AWASTHY, JUDICIAL MEMBER I.T.A. NO. 1465/MDS/2013 ASSESSMENT YEAR : 2006-07 SMT. G. MALINI, NO. 49, SRI VENKATESWARA PERUMAL NAGAR, ARUMBAKKAM, CHENNAI 600 106 [PAN: AGAPM 2993 E] (APPELLANT) VS ASST. COMMISSIONER OF INCOME TAX, CIRCLE-IV CHENNAI 34 (RESPONDENT) APPELLANT BY : SHRI R. SIVARAMAN, ADVOCATE RESPONDENT BY : SHRI T.N. BETGERI, JCIT DATE OF HEARING : 26-09-2013 DATE OF PRONOUNCEMENT : 24-10-2013 O R D E R PER VIKAS AWASTHY, JUDICIAL MEMBER: THE APPEAL HAS BEEN FILED BY THE ASSESSEE AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX(APPEALS)-VIII, CH ENNAI DATED 01-02-2013 RELEVANT TO THE ASSESSMENT YEAR (AY) 200 6-07. I.T.A. NO. 1465/MDS/2013 2 2. THE ASSESSEE HAS RAISED TWO GROUNDS IN HER APPEA L I.E., IN RESPECT OF ADDITION MADE TOWARDS LABOUR CHARGES ` 1.00 LAKH AND UN-PROVED CASH CREDITS U/S. 68 OF THE INCOME TAX AC T, 1961 (HEREIN AFTER REFERRED TO AS THE ACT) ` 3,14,800/-. 3. THE ASSESSEE IS ENGAGED IN THE BUSINESS OF MANUF ACTURE OF BITUMEN PRODUCTS & FELTS. SHE IS ALSO ENGAGED IN T HE BUSINESS OF CONTRACTS FOR PURCHASE OF MATERIALS WHEREIN SHE INC URS LABOUR EXPENSES. THE ASSESSEE FILED HER RETURN OF INCOME FOR THE AY. 2006-07 ON 13-10-2006 DECLARING HER INCOME AS ` 4,73,836/- AND AGRICULTURAL INCOME OF ` 5,99,400/-. DURING THE COURSE OF ASSESSMENT, THE ASSESSING OFFICER OBSERVED THAT THE ASSESSEE HAS INCURRED LABOUR CHARGES TO THE TUNE OF ` 17,28,696/-. THE LABOUR EXPENSES WERE PAID IN CASH. ON PERUSAL OF T HE RECORDS, ASSESSING OFFICER WAS OF THE VIEW THAT THE LABOUR E XPENSES HAVE BEEN INFLATED. AFTER DISCUSSION WITH THE ASSESSEE, THE ASSESSING OFFICER ADDED BACK A SUM OF ` 1.00 LAKH IN THE INCOME RETURNED ON ACCOUNT OF INFLATED LABOUR EXPENSES. THE ASSESSEE AGREED TO THE ADDITION MADE. THE ASSESSING OFFICER FURTHER OBSERVED THAT THE AS SESSEE HAD SHOWN IN HER BALANCE SHEET UN-SECURED LOANS FRO M FRIENDS AND RELATIVES TO THE TUNE OF ` 11,76,342/-. THE ASSESSEE WAS I.T.A. NO. 1465/MDS/2013 3 ASKED TO SUBMIT THE LIST OF LOAN CREDITORS ALONG WI TH THE ADDRESSES. THE LOANS WERE RANGING BETWEEN ` 15,000/- TO ` 19,000/-. THE PARTIES FROM WHOM LOANS WERE TAKEN HAD SUBMITTED CO NFIRMATION LETTERS STATING THAT THE LOAN HAS BEEN GIVEN FOR BU SINESS PURPOSES. THE ASSESSING OFFICER WAS ASKED TO PROVE THE CREDIT WORTHINESS OF THE PARTIES. FROM AMONG THE LIST OF SUNDRY CREDITO RS, THE ASSESSEE WAS ABLE TO PROVE CREDITWORTHINESS OF MAJORITY OF T HE LENDERS. HOWEVER, CREDITWORTHINESS OF NINETEEN PERSONS FROM WHOM ASSESSEE HAD TAKEN LOAN WAS NOT PROVED. THE TOTAL LOAN FROM SUCH NINETEEN PERSONS AMOUNTED TO ` 3,14,800/-. THE ASSESSING OFFICER MADE ADDITION OF SAME U/S. 68 OF THE ACT. AGGRIEVED AGAINST THE ASSESSMENT ORDER, THE ASSESS EE PREFERRED AN APPEAL BEFORE THE CIT(APPEALS). THE C IT(APPEALS) VIDE IMPUGNED ORDER, CONFIRMED THE FINDINGS OF THE ASSESSING OFFICER. AGGRIEVED BY THE ORDER OF THE CIT(APPEALS ), THE ASSESSEE HAS COME IN SECOND APPEAL BEFORE THE TRIBUNAL. 4. SHRI R. SIVARAMAN, ADVOCATE, APPEARING ON BEHALF OF THE ASSESSEE VEHEMENTLY OPPOSED THE IMPUGNED ORDER AND PRAYED FOR THE DELETION OF THE ADDITIONS MADE BY THE AUTHORITI ES BELOW. I.T.A. NO. 1465/MDS/2013 4 5. ON THE OTHER HAND, SHRI T.N. BETGERI, APPEARING ON BEHALF OF THE REVENUE SUPPORTED THE IMPUGNED ORDER. 6. WE HAVE HEARD THE SUBMISSIONS MADE BY THE REPRESENTATIVES OF BOTH THE PARTIES AND HAVE PERUSE D THE ORDERS OF THE AUTHORITIES BELOW. THE ADDITIONS HAVE BEEN MAD E IN RESPECT OF INFLATED LABOUR CHARGES ` 1.00 LAKH AND UN-PROVED CASH CREDITS ` 3,14,800/-. AS REGARDS, LABOUR CHARGES IS CONCERNE D, A PERUSAL OF THE ASSESSMENT ORDER SHOWS THAT THE ADDITIONS MADE HAVE BEEN AGREED BY THE ASSESSEE AT THE TIME OF ASSESSMENT. THEREFORE, THE ASSESSEE SHOULD NOT HAVE ANY GRIEVANCE ON THIS ISSU E AFTER CONCEDING TO THE ADDITION MADE. AS REGARDS THE ADDITION MADE U/S. 68 WITH RESPECT T O UN- PROVED CASH CREDITS, THE ASSESSEE HAD GIVEN THE DET AILS OF THE PERSONS FROM WHOM THE ASSESSEE HAD GIVEN CONFIRMATI ON LETTERS. THE PARTIES FROM WHOM LOANS HAVE BEEN TAKEN HAD GIV EN CONFIRMATION LETTERS TO THE ASSESSEE. IT HAS BEEN POINTED OUT THAT NONE OF THE LENDERS IS A TAX PAYER OR OBTAINED PAN. OUT OF THE TOTAL SUM OF ` 11,76,342/-, THE ASSESSING OFFICER HAS MADE ADDITIO N TO THE TUNE OF ` 3,14,800/- AFTER VERIFYING THE CREDITWORTHINESS OF THE LENDERS. THE ASSESSING OFFICER HAS RECORDED THE FI NDING THAT IN RESPECT OF NINETEEN PERSONS, THE CREDITWORTHINESS H AS NOT BEEN I.T.A. NO. 1465/MDS/2013 5 PROVED. THE ASSESSEE HAS NOT BEEN ABLE TO CONTROVE RT THIS FINDING OF FACT. THE CIT(APPEALS) HAS UPHELD THE FINDINGS OF ASSESSING OFFICER. 7. WE DO NOT FIND ANY REASON TO INTERFERE WITH THE FINDINGS OF THE CIT(APPEALS) ON THE ISSUES. THEREFORE, THERE IS NO MERIT IN THE APPEAL OF THE ASSESSEE. THE APPEAL OF THE ASSESSEE IS DISMISSED AS SUCH. ORDER PRONOUNCED ON THURSDAY , THE 24 TH OCTOBER, 2013 AT CHENNAI. SD/- SD/- (DR. O.K. NARAYANAN) (VIK AS AWASTHY) VICE PRESIDENT JUDICIAL MEMBER DATED: 24 TH OCTOBER, 2013 TNMM COPY TO: APPELLANT/RESPONDENT/CIT(A)/CIT/DR