K.Gandhimathi, Komarapalayam V. DCIT, Salem

ITA 1481/CHNY/2015

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 7689 (ITAT-CHENNAI)
• Duration Of Justice: 9 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-03-2016
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Next Hearing Date: 27-01-2016
• Assessment Year: 2004-2005
• Appeal Filed On: 18-06-2015
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Assessee Lawyers: A S SRIRAMAN MR K N DHAND
• Keywords: Unexplained cash credit
• Section: 153A; 68; 6; 132

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL , A B ENCH, CHENNAI . , . , # $ BEFORE SHRI A.MOHAN ALANKAMONY, ACCOUNTANT MEMBER AND SHRI G.PAVAN KUMAR, JUDICIAL MEM BER ./ ITA NO.1481/MDS/2015 ( / ASSESSMENT YEAR: 2004-05) SMT. K.GANDHIMATHI, PROPX. GUGANRAJ FABRICS, 6-A, BYE-PASS ROAD, KOMARAPALAYAM. VS THE DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE, SALEM. PAN: AEZPG4215L ( /APPELLANT) ( /RESPONDENT) / APPELLANT BY : MR. A.S.SRIRAMAN, ADVOCATE /RESPONDENT BY : MR. K.N.DHANDAPANI, JCIT /DATE OF HEARING : 27 TH JANUARY, 2016 /DATE OF PRONOUNCEMENT : 29 TH MARCH, 2016 / O R D E R PER A. MOHAN ALANKAMONY, AM:- THIS APPEAL IS FILED BY THE ASSESSEE AGGRIEVED BY THE ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX (A PPEALS)- 18, CHENNAI DATED 27.02.2015 IN ITA NO.288/14-15 PASSED UNDER SECTION 153C /143(3) & 250 (6) OF THE ACT. 2. THE ASSESSEE HAS RAISED SEVERAL GROUNDS IN HER APPEAL, HOWEVER, THE CRUX OF THE ISSUE IS THAT THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED IN SUSTAINING THE ADDITION OF ` 7,34,800/- MADE BY THE LEARNED ASSESSING OFFICER TOWARDS UNEXPLAINED CASH CREDIT UNDER SECTION 68 OF THE ACT. 2 ITA NO.1481/MDS/2015 3. THE ASSESSEE IS ENGAGED IN THE BUSINESS UNDER TH E NAME AND STYLE OF HIS PROPRIETARY CONCERN M/S. GUGA NRAJ FABRICS. THERE WAS A SEARCH UNDER SECTION 132 OF T HE ACT ON 10.11.2005 IN THE CASE OF MR. SELVARAJ, BROTHER-IN- LAW OF THE ASSESSEE AND VARIOUS DOCUMENTS WERE SEIZED. SUBSEQUENTLY, NOTICE UNDER SECTION 153A WAS ISSUED TO MR. SELVARAJ AND NOTICE UNDER SECTION 153C WAS ISSUED T O THE ASSESSEE SMT. K.GANDHIMATHI, SHRI S.KATHIRVEL, SMT. S.VIJAYA AND M/S.ANBURAJ TEXTILES. IN RESPONSE, TH E ASSESSEE FILED HER RETURNS OF INCOME ON 31.08.2007 FOR THE ASSESSMENT YEARS 2000-01 TO 2005-06. ON SCRUTINY, T HE LEARNED ASSESSING OFFICER NOTICED THAT FOR THE ASSE SSMENT YEAR 2004-05, THE ASSESSEE HAD CREDITED INTO HER C APITAL ACCOUNT RS.3,70,000/-, RS.2,65,000/-, RS.49,900/-, RS.49,900/- ON 11.10.2003, 18.10.2003, 01.01.2004 A ND 06.01.2004 RESPECTIVELY AGGREGATING TO RS.7,34,800/ - BEING CASH INTRODUCED IN THE BUSINESS. WHEN THE ASSESSEE WAS ASKED TO EXPLAIN, THE ASSESSEE FAILED TO ADDUCE ANY EVIDENCE IN SUPPORT OF THE SOURCE OF CASH CREDITS OF RS.7,34 ,800/-. THEREFORE, THE LEARNED ASSESSING OFFICER TREATED TH E SAME AS 3 ITA NO.1481/MDS/2015 UNEXPLAINED CASH CREDITS AND MADE ADDITION UNDER SE CTION 68 OF THE ACT. 4. ON APPEAL, THE LEARNED COMMISSIONER OF INCOME TA X (APPEALS) CONFIRMED THE ADDITION OF RS.7,34,800/- M ADE BY THE LEARNED ASSESSING OFFICER UNDER SECTION 68 OF T HE ACT, SINCE THE ASSESSEE HAD FAILED TO SUBSTANTIATE HER CLAIM BEFORE HIM WITH COGENT MATERIALS/EVIDENCE. 5. BEFORE US, THE LEARNED AUTHORIZED REPRESENTATIVE SUBMITTED THAT THE ASSESSEE WAS FINANCIALLY SOUND A ND HAILING FROM A RESOURCEFUL FAMILY BACKGROUND AND THEREFORE IN THE NORMAL COURSE THE AMOUNT OF RS.7,34,800/- WOULD BE AVAILABLE WITH HER FOR INVESTMENT IN THE BUSINESS. HENCE, IT WAS PLEADED THAT THE ADDITION OF RS.7,34,800/- MAY BE DELETED. 6. THE LEARNED DEPARTMENTAL REPRESENTATIVE ON THE O THER HAND, VEHEMENTLY ARGUED IN SUPPORT OF THE ORDERS OF THE REVENUE. 7. WE HAVE HEARD THE RIVAL SUBMISSIONS AND CAREFULL Y PERUSED THE MATERIALS AVAILABLE ON RECORD. IT IS AP PARENT FROM THE ORDERS OF THE LEARNED ASSESSING OFFICER AND LEA RNED 4 ITA NO.1481/MDS/2015 COMMISSIONER OF INCOME TAX (APPEALS) THAT THE ASSES SEE WAS NOT ABLE TO ESTABLISH HER SOURCE OF CAPITAL INT RODUCTION AMOUNTING TO RS.7,34,800/- IN HER BOOKS OF ACCOUNT. HENCE THE REVENUE HAS INVOKED THE PROVISIONS OF SECTION 6 8 OF THE ACT AND MADE THE ADDITION. HOWEVER, CONSIDERING THE PRAYER OF THE LEARNED AUTHORIZED REPRESENTATIVE AND THE FI NANCIAL BACKGROUND OF THE ASSESSEE AND HER FAMILY, WE ARE O F THE CONSIDERED VIEW THAT AT LEAST AN AMOUNT OF RS.4,00, 000/- WOULD HAVE BEEN AVAILABLE WITH HER FROM PERSONAL SA VINGS AND FAMILY KITTY FOR MAKING INVESTMENT IN HER BUSIN ESS. THEREFORE, IN THE INTEREST OF JUSTICE, WE HEREBY DI RECT THE LEARNED ASSESSING OFFICER TO DELETE THE ADDITION TO THE EXTENT OF RS.4,00,000/-. ACCORDINGLY, WE HEREBY CONFIRM T HE ADDITION OF RS.3,34,800/-. 8. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS PAR TLY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON THE 29 TH MARCH, 2016 SD/- SD/- ( . ) ( . ) (G.PAVAN KUMAR) ( A.MOHAN ALAN KAMONY ) # % / JUDICIAL MEMBER % / ACCOUNTANT MEMBER # /CHENNAI, ( /DATED 29 TH MARCH, 2016 SOMU 5 ITA NO.1481/MDS/2015 *+ ,+ /COPY TO: 1. APPELLANT 2. RESPONDENT 3. - () /CIT(A) 4. - /CIT 5. + 1 /DR 6. /GF