The ITO, Ward-9(2), Surat V. Smt. Jayshreeben Chhatrashal Parmar, Surat

ITA 1468/AHD/2011

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 89322 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 11 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-05-2015
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 06-04-2015
• Assessment Year: 2007-2008
• Appeal Filed On: 24-05-2011
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Assessee Lawyers: S B VAIDYA
• Keywords: Business income; Source of fund
• Section: 69

Judgement Text

, , , , IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH, AHMEDABAD 0 0 , !' , # BEFORE SHRI N.S. SAINI, ACCOUNTANT MEMBER AND SHRI KUL BHARAT, JUDICIAL MEMBER ./ ././ ./ ITA NO. 1468/AHD/2011 & '& & '& & '& & '&/ // / ASSESSMENT YEAR: 2007-08 ITO, WARD-9(2), SURAT VS SMT. JAYSHREEBEN CHHATRASHAL PARMAR, C/O. PARMAR BOOT HOUSE, 11/215, BHAGALTALAV, SURAT PAN : ABBPP 1658 D () () () () / // / (APPELLANT) *+ *+ *+ *+ () ()() () / // / (RESPONDENT) REVENUE BY : SHRI NIMESH YADAV, SR. DR ASSESSEE(S) BY : SHRI S.B. VAIDYA, AR , - './ // / DATE OF HEARING : 16/04/2015 /0' - '. / // / DATE OF PRONOUNCEMENT: 08/05/2015 1 1 1 1/ // / O R D E R PER SHRI KUL BHARAT, JUDICIAL MEMBER:- THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS)-V, SURAT (CIT (A) IN SHORT) DATED 17.01.2011 FOR THE ASSESSMENT YEAR 2007-08. 2. THE REVENUE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL:- 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW , THE LD. CIT(A) HAS ERRED IN DELETING THE ADDITION OF RS.27, 49,761/- MADE BY THE A.O. U/S 69 OF THE ACT DESPITE THE FACT THAT ASSESSEE FA ILED TO EXPLAIN THE SOURCE OF THE CREDITS MADE IN THE UNDISCLOSED BANK ACCOUNT. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, THE LD. CIT(A) HAS ERRED IN DELETING THE ADDITION OF RS.27, 49,761/- MADE BY THE A.O. U/S 69 OF THE ACT AFTER ACCEPTING THE PLEA OF THE A SSESSEE THAT CASH DEPOSITS MADE IN THE UNDISCLOSED ACCOUNT WERE MADE FROM THE CASH WITHDRAWN FROM ITA NO. 1468/AHD/2011 ITO V. SMT. JAYSHREEBEN C. PARMAR FOR AY 2007-08 2 THIS ACCOUNT ON EARLIER OCCASIONS DESPITE THE FACT THAT ASSESSEE FAILED TO FURNISH ANY DOCUMENTARY EVIDENCES IN SUPPORT OF THI S CLAIM . 3. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, THE LD. CIT(A) HAS ERRED IN DELETING THE ADDITION OF RS.27, 49,761/- MADE BY THE A.O. U/S 69 OF THE ACT AFTER ACCEPTING THE PLEA OF THE A SSESSEE THAT AN AMOUNT OF RS.8,74,680/- WAS THE LOAN AMOUNT TAKEN FROM FRIEND S/RELATIVES DESPITE THE FACT THAT THESE LOANS WERE NOT REFLECTED IN THE BAL ANCE SHEETS OF THE LENDERS. FURTHER THE ASSESSEE FAILED TO PROVE THE GENUINENES S AND THE CREDIT WORTHINESS OF THESE TRANSACTIONS. 4. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, THE LD. C1T(A) HAS ERRED IN DELETING THE ADDITION OF RS.27, 49,761/- MADE BY THE A.O. U/S 69 OF THE ACT AFTER ACCEPTING THE PLEA OF THE ASSESSEE THAT AN AMOUNT OF RS.4,80,000/- WAS THE CASH DEPOSIT MADE BY THE J OINT HOLDERS OF THIS UNDISCLOSED BANK ACCOUNT DESPITE THE FACT THAT THE ASSESSEE FAILED TO EXPLAIN THE SOURCE OF FUNDS AND CREDITWORTHINESS OF THE JOI NT HOLDERS FOR MAKING THESE CASH DEPOSITS. 5. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE AND IN LAW, THE LD. CIT(A) HAS ERRED IN DELETING THE ADDITION OF RS.27, 49,761/- MADE BY THE A.O. U/S 69 OF THE ACT AFTER ACCEPTING THE PLEA OF THE A SSESSEE THAT AN AMOUNT OF RS.5,57,811/- WAS DEPOSIT MADE OUT OF THE SALE PROC EEDS OF FOOTWEAR TRADING, THE PROFIT OF WHICH HAD ALREADY BEEN OFFERED TO THE DEPARTMENT U/S 44 AF, DESPITE THE FACT THAT THE ASSESSEE FAILED TO FURNIS H ANY DOCUMENTARY EVIDENCES IN SUPPORT OF HER CLAIM THAT THIS AMOUNT OF RS. 5,5 7,711/- WAS PART OF HER RETAIL TRADING BUSINESS. 6. IT IS THEREFORE, PRAYED THAT THE ORDER OF THE ID . CIT (A) BE SET ASIDE AND THE ASSESSING OFFICER'S ORDER BE RESTORED. 3. BRIEFLY STATED FACTS ARE THAT THE CASE OF THE AS SESSEE WAS PICKED UP FOR SCRUTINY ASSESSMENT AND THE ASSESSMENT U/S.143(3) O F THE INCOME-TAX ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT) WAS FRA MED VIDE ORDER DATED 24.12.2009. WHILE FRAMING THE ASSESSMENT, THE ASSES SING OFFICER MADE ADDITION OF RS.50,76,587/- BY INVOKING THE PROVISIO NS OF SECTION 69 OF THE INCOME-TAX ACT, 1961. AGAINST THIS, THE ASSESSEE F ILED AN APPEAL BEFORE THE LD.CIT(A) WHO, AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE, DIRECTED ITA NO. 1468/AHD/2011 ITO V. SMT. JAYSHREEBEN C. PARMAR FOR AY 2007-08 3 THE ASSESSING OFFICER TO REDUCE THE ADDITION U/S 69 TO RS.23,26,826/- AGAINST THE ADDITION OF RS.50,76,587/- MADE BY THE ASSESSIN G OFFICER. 4. THE LD. SR. DR. SUBMITTED THAT THE CIT(A) WAS NO T JUSTIFIED IN REDUCING THE ADDITION TO RS.23,26,826/- U/S 69 OF T HE ACT. HE SUBMITTED THAT DURING THE COURSE OF ASSESSMENT, THE ASSESSING OFFI CER NOTICED THAT THE ASSESSEE WAS MAINTAINING BANK ACCOUNT I.E. SB ACCOU NT NO.61504, IN THE SURAT PEOPLES CO-OPERATIVE BANK, BHAGATALAV BRANCH , SURAT WHICH WAS NOT DISCLOSED TO THE DEPARTMENT. HE SUBMITTED THAT THER E WERE CREDIT ENTRIES IN SB ACCOUNT NO.61504 HELD BY THE ASSESSEE IN THE SUR AT PEOPLES CO- OPERATIVE BANK. HE SUBMITTED THAT ADMITTEDLY THE A SSESSEE WAS JOINT ACCOUNT HOLDER OF THE ACCOUNT AND WAS OPERATING IT. HE SUBMITTED THAT THERE IS NO DISPUTE WITH REGARD TO THE FACT THAT THE ASSE SSEE HAS NOT DISCLOSED THE CREDIT ENTRIES OF THE UNDISCLOSED BANK ACCOUNT IN T HE RETURN OF INCOME. HE ALSO SUBMITTED THAT THE CIT(A) FAILED TO APPRECIATE THE FACT THAT THIS BANK ACCOUNT HAD NOT BEEN ACCOUNTED FOR IN THE BOOKS OF ACCOUNTS OF THE ASSESSEE AND THE DEPOSITS IN THE BANK ACCOUNTS WERE ALSO NOT ACCOUNTED FOR BY THE ASSESSEE. THE ASSESSEE HAD GROSSLY FAILED TO EXPLAI N THE SOURCE OF CREDITS IN THIS ACCOUNT. HE FURTHER SUBMITTED THAT THE LD. CI T(A) FAILED TO APPRECIATE THE FACT THAT THE ASSESSEE HAS NOT FURNISHED ANY EV IDENCE FROM OTHER JOINT HOLDER OF THE ACCOUNT TO PROVE THE GENUINENESS OF T HE CASH CREDIT. THE LD. CIT(A) ALSO FAILED TO APPRECIATE THE FACT THAT PRIO R TO 07.12.2009, THE ASSESSEE HAD NOT SUBMITTED THAT IT HAS ANY OTHER INCOME FROM THE BUSINESS WHICH IS COVERED UNDER THE PROVISIONS OF 44AF OF THE ACT AND THE CREDITS IN THE BANK ACCOUNT NO.61504 PERTAINED TO THE BUSINESS INCOME. HE FURTHER SUBMITTED THAT THE CIT(A) FAILED TO APPRECIATE THE FACT THAT THE SOURCES OF LOANS TAKEN FROM THE SO-CALLED PARTIES WERE UNEXPLAINED. HE SU BMITTED THAT THE CIT(A) ITA NO. 1468/AHD/2011 ITO V. SMT. JAYSHREEBEN C. PARMAR FOR AY 2007-08 4 FAILED TO APPRECIATE THE FACT THAT THE LOANS WERE N OT REFLECTED IN THE BALANCE- SHEET. 5. ON THE CONTRARY, THE LD. COUNSEL FOR THE ASSESSE E MR. VAIDYA SUBMITTED THAT THE ASSESSEE HAS EXPLAINED THE SOURC E OF CREDITS. HE FURTHER SUBMITTED THAT IT IS AN ADMITTED POSITION THAT THE ACCOUNT IS HELD IN THE JOINT NAME AND CREDITS WERE MADE JOINTLY; THEREFORE THE A SSESSEE CANNOT BE HELD SOLELY RESPONSIBLE AND THE ASSESSEE HAD EXPLAINED T HE SAME BEFORE THE ASSESSING OFFICER AS WELL AS THE LD. CIT(A). 6. WE HAVE HEARD THE RIVAL SUBMISSIONS, PERUSED THE ORDERS OF THE LOWER AUTHORITIES AND MATERIAL AVAILABLE ON RECORD. THER E IS NO DISPUTE WITH REGARD TO THE FACT THAT THE ASSESSEE HAD NOT DECLAR ED THE ACCOUNT I.E. SB. A/C. NO.61504 MAINTAINED WITH THE SURAT PEOPLES CO-OPER ATIVE BANK, BHAGATALAV BRANCH, SURAT, BEFORE THE REVENUE AUTHOR ITIES IN THE RETURN FILED. IT IS ALSO NOT DISPUTED THAT THE CREDIT ENTRIES MAD E INTO THE ACCOUNT NO.61504 WAS HELD IN THE JOINT NAME AND THE CREDITS WERE MAD E OUT OF LOANS, REDEMPTION OF MUTUAL FUND, INTEREST/DIVIDEND AND DE POSITS BY OTHER JOINT ACCOUNT HOLDERS. THEREFORE, THE ASSESSING OFFICER M ADE ADDITION OF RS.50,76,587/- U/S 69 OF THE ACT, ON ACCOUNT OF THE CASH CREDIT/DEPOSITS AND INVESTMENT MADE IN THE BANK ACCOUNT NO.61504 BY TRE ATING THE SAME AS INCOME OF THE ASSESSEE FROM UNDISCLOSED SOURCES. T HE LD. CIT(A) HAS REDUCED THE ADDITION U/S 69 TO THE EXTENT OF RS.23, 26,826/-, TREATING THE BALANCE AMOUNT AS EXPLAINED. THE GRIEVANCE OF THE R EVENUE IS THAT THE LD. CIT(A) WAS NOT JUSTIFIED IN REDUCING THE ADDITION A ND THE ADMITTED POSITION IS THAT THE ASSESSEE HAD NOT DISCLOSED THE BANK ACC OUNT IN THE RETURN OF INCOME AND OFFERED ONLY THE BUSINESS RECEIPTS FOR T AXATION. THE EXPLANATION GIVEN BY THE ASSESSEE IS THAT THE ACCOUNT WAS JOINT ACCOUNT AND THE ASSESSEE CANNOT BE HELD SOLELY LIABLE FOR THE CREDITS INTO T HE SAID ACCOUNT. WE FIND ITA NO. 1468/AHD/2011 ITO V. SMT. JAYSHREEBEN C. PARMAR FOR AY 2007-08 5 THAT NEITHER THE ASSESSING OFFICER NOR THE CIT(A) H AD MADE ANY INQUIRY WITH REGARD TO THE OTHER JOINT ACCOUNT HOLDERS. THE REFORE, CONSIDERING THE TOTALITY OF THE FACTS, WE HEREBY SET ASIDE THE ORDE R OF THE CIT(A) AND RESTORE THE ISSUE BACK TO THE FILE OF THE ASSESSING OFFICER FOR DECIDING THE ISSUE AFRESH. THE ASSESSING OFFICER IS HEREBY DIRECTED T O MAKE A FRESH ASSESSMENT AFTER MAKING INQUIRIES FROM THE JOINT ACCOUNT HOLDE RS. THUS, THIS GROUND OF APPEAL OF THE REVENUE IS ALLOWED FOR STATISTICAL PU RPOSES. 7. IN THE RESULT, THE APPEAL OF THE REVENUE IS ALLO WED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE COURT ON 8 TH MAY, 2015 AT AHMEDABAD. SD/- SD/- ( N.S. SAINI) ACCOUNTANT MEMBER (KUL BHARAT) JUDICIAL MEMBER AHMEDABAD; DATED 08/05/2015 *BIJU T. 1 - *'2 32'' 1 - *'2 32'' 1 - *'2 32'' 1 - *'2 32''/ COPY OF THE ORDER FORWARDED TO : 1. () / THE APPELLANT 2. *+() / THE RESPONDENT. 3. ' 4 / CONCERNED CIT 4. 4 ( ) / THE CIT(A) 5. 2!7 *' , , / DR, ITAT, AHMEDABAD 6. 78& 9, / GUARD FILE . 1 1 1 1 / BY ORDER, TRUE COPY : :: :/ // / ; ; ; ; ( DY./ASSTT.REGISTRAR) , , , , / ITAT, AHMEDABAD