Sri T Chakkilam Srinivasa Rao, Kurnool V. ITO., Ward-1, Kurnool, Kurnool

ITA 1483/HYD/2014

• Counselvise Citation: 148322514 RSA 2014
• Duration Of Justice: 1 year(s) 1 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-10-2015
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 23-06-2016
• Assessment Year: 2008-2009
• Appeal Filed On: 17-09-2014
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Assessee Lawyers: A C GANGAIAH
• Keywords: Unexplained cash credit; Additional evidence; Corroborative evidences
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCHES B (SMC) : HYDERABAD BEFORE SMT. P. MADHAVI DEVI, JUDICIAL MEMBER ITA.NO.1483/HYD/2014 ASSESSMENT YEAR 2008-2009 MR. T. CHAKKILAM SRINIVASA RAO, KURNOOL. PAN AEEPC3722K VS. THE INCOME TAX OFFICER WARD-1, KURNOOL. (APPELLANT) (RESPONDENT) FOR ASSESSEE : MR. A.C. GANGAIAH FOR REVENUE : MR. PRABHAT KUMAR GUPTA DATE OF HEARING : 19.07.2016 DATE OF PRONOUNCEMENT : 24.08.2016 ORDER PER SMT. P. MADHAVI DEVI, J.M. THIS IS ASSESSEES APPEAL FOR THE A.Y. 2008-09. TH E ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL : 1. CIT(A) AFTER CONSIDERING SOURCES FOR PEAK CASH CRE DIT, MIGHT HAVE ALLOWED THE APPEAL. 2. CIT(A) AFTER CONSIDERING THE FACTS, MIGHT HAVE DELE TED RS.6,40,000 SPECIFIED AS UNEXPLAINED CASH CREDIT. 3. TO PERMIT THE APPELLANT TO RAISE ANY OTHER GROUND A T THE TIME OF HEARING OF THE APPEAL. 2. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE, AN INDIVIDUAL, FILED HIS RETURN OF INCOME FOR THE A.Y. 2 008-09 ON 25.03.2010 ADMITTING TOTAL INCOME OF RS.1,16,000. DURI NG THE ASSESSMENT PROCEEDINGS UNDER SECTION 143(3) OF THE I .T. ACT, 1961, ASSESSEE WAS REQUIRED TO FILE CERTAIN DETAILS. F URTHER, AS PER THE AIR DATA, ASSESSEE HAD DEPOSITED CASH IN EXC ESS OF RS.10 2 ITA.NO.1483/HYD/2014 MR. T. CHAKKILAM SRINIVASA RAO, KURNOOL. LAKHS FOR THE F.Y. 2007-08 IN S.B. A/C.NO.0081100013 4742 HELD BY HIM IN HDFC BANK, HIMAYATNAGAR BRANCH, HYDERABAD. THE ASSESSING OFFICER, THEREFORE, ASKED THE ASSESSEE TO SU BSTANTIATE THE SOURCE FOR THE SAID CASH DEPOSITS AND CLEARING CRE DITS IN THE ACCOUNT WITH SUPPORTING EVIDENCE. ASSESSEE SUBMITTED THA T ALL THESE TRANSACTIONS IN THE HDFC ACCOUNT ARE RELATED TO THE HUF OF THE ASSESSEE AND IN SUPPORT OF THIS CONTENTION, HE BROUG HT THE BOOKS OF ACCOUNT EXPLAINING THE TRANSACTIONS IN THE BA NK ACCOUNT AND OTHER TRANSACTIONS MADE BY THE HUF DURING THE YEAR . THE ASSESSING OFFICER HOWEVER, OBSERVED THAT THE ASSESSEE HAS NOT SUBMITTED ANY PRIMARY EVIDENCE FOR MAJOR TRANSACTIONS SUCH AS ADVANCES RECEIVED TOWARDS SALE OF PLOT NO.44, VENKATAR AMANA COLONY, KURNOOL AND OTHER TRANSACTIONS RELATING TO THE D EBTORS, CLAIMED TO HAVE BEEN ENTERED INTO BY THE HUF. THE ASS ESSEE SUBMITTED THAT FOR THE PURPOSES OF OPENING BANK ACCOUNT, PAN OF THE INDIVIDUAL WAS QUOTED INSTEAD OF PAN OF THE HUF. IT WAS FURTHER SUBMITTED THAT THE ASSESSEE HAS SHOWN CASH ON HA ND IN THE BANK AS ON 31.03.2008 AT RS.5,75,000, WHICH INCLU DES THE CASH BALANCE IN HDFC BANK ACCOUNT OF RS.3,02,383. O N VERIFICATION OF THE DETAILS FURNISHED BY THE ASSESSEE, THE ASSESSING OFFICER OBSERVED THAT THE ASSESSEE HAS BEEN FILING HI S RETURNS IN HIS INDIVIDUAL AND HUF STATUS FOR VARIOUS ASSESSMENT YEARS ALONG WITH THE RECEIPTS AND PAYMENTS ACCOUNT AND BALANCE SHEE T AND THAT IN THE RECEIPTS AND PAYMENTS ACCOUNT OF THE HUF FOR THE F.Y. 2007-08, THE TRANSACTIONS IN THE HDFC ACCOUNT ARE NOT RE FLECTED. THEREFORE, HE HELD THAT IT IS NOT PROVED WITH EVIDENCE TH AT THESE TRANSACTIONS OF HDFC ACCOUNT PERTAIN TO THE HUF. HE, THER EFORE, TREATED THE PEAK CASH CREDIT OF RS.6,25,000 AS THE ASSE SSEES UNEXPLAINED CASH DEPOSITS AND BROUGHT IT TO TAX. SIMILA RLY, HE ALSO BROUGHT TO TAX CLEARING CREDITS OF RS.1,40,000 ON 09.04.2007 3 ITA.NO.1483/HYD/2014 MR. T. CHAKKILAM SRINIVASA RAO, KURNOOL. AND RS.5 LAKHS ON 31.10.2007 AS INCOME OF THE ASSESS EE. HE MADE SOME MORE ADDITIONS AND BROUGHT THE SAME TO TAX. AGGRIEVED, ASSESSEE PREFERRED AN APPEAL BEFORE THE C IT(A) WHO CONFIRMED THE ORDER OF THE ASSESSING OFFICER AND THE A SSESSEE IS IN SECOND APPEAL BEFORE US. 3. LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE ABOVE TWO ADDITIONS MADE BY THE ASSESSING OFFICER AND CONFIRMED BY THE CIT(A) ARE NOT SUSTAINABLE. HE SUBMITTED THAT THE ASSESSING OFFICER HAS TAKEN THE PEAK CASH CREDIT AS ON 02.05.2007 AT RS.6,25,000. HE SUBMITTED THAT THIS SUM O F RS.6,25,000 INCLUDES CHEQUE AMOUNT OF RS.1,40,000 WH ICH WAS CREDITED TO THE ASSESSEES BANK ACCOUNT ON 09.04.2007 W HICH WAS RECEIVED AS ADVANCE FOR SALE OF PLOT. HE SUBMITTED THA T M/S. ANRV CONSTRUCTIONS HAD GIVEN A CHEQUE FOR RS.1,40,000 DRAWN ON ING VYSYA BANK, HYDERABAD WHICH WAS CREDITED TO THE ACCOUNT OF THE ASSESSEE ON 09.04.2007 AND THEREFORE, THE IDENTITY OF THE PERSON AND THE SOURCE FOR GIVING THE AMOUNT IS EXPLAINED BY ENCLOSING COPY OF THE BANK ACCOUNT OF THE PERSON WH O HAS GIVEN THE CHEQUE. HE HAS ALSO FILED BEFORE US A CONF IRMATION LETTER OF THE RELEVANT PARTY TO THE EFFECT THAT THIS ADVANCE AM OUNT OF RS.1,40,000 HAS BEEN REPAID BY THE ASSESSEE IN CASH ON 02.07.2007 DUE TO NON-MATERIALISATION OF THE TRANSACTIO N. AS REGARDS THE ADDITIONS ON ACCOUNT OF CLEARING CREDITS OF RS.1,40,000 (AS EXPLAINED ABOVE) AND RS.5 LAKHS ON 31 ST OCTOBER, 2007, THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THA T THE ASSESSEE HAS FILED THE CONFIRMATION LETTERS BEFORE THE TRIBUNAL NOW AS ADDITIONAL EVIDENCE AND PRAYED THAT THE SAME MAY BE ADMITTED AND CONSIDERED FOR ADJUDICATION. HE SUBMITTED TH AT ONE MR. MALIK NASER GAVE A CHEQUE DRAWN ON HSBC BANK F OR A SUM 4 ITA.NO.1483/HYD/2014 MR. T. CHAKKILAM SRINIVASA RAO, KURNOOL. OF RS.5 LAKHS FOR THE PURCHASE OF THE LAND OF THE HUF AND SINCE THE SAID TRANSACTION DID NOT MATERIALISE, THE ASSESSEE H AD TO RETURN THE SUM BY WAY OF CASH. HE THEREFORE, PRAYED TH AT THESE ADDITIONAL EVIDENCES BE ADMITTED AND CONSIDERED FOR A DJUDICATION. HE FURTHER SUBMITTED THAT THE CIT(A), ON PERUSAL OF TH E RECEIPTS AND PAYMENTS ACCOUNT OF THE HUF, HAD CONSIDERED THE TOTAL RECEIPTS OF THE HUF INCLUSIVE OF THE OPENING CASH BA LANCE OF RS.6,07,000 WHICH IS MORE THAN RS.4,85,000 WHICH IS THE PEAK CASH CREDIT AFTER EXCLUSION OF THE SUM OF RS.1,40,000 . THEREFORE, ACCORDING TO HIM, THE CIT(A) OUGHT TO HAVE ALLOWED THE SOURCE FOR THE PEAK CASH CREDIT OF A SUM OF RS.6,07,000. 4. THE LD. D.R., HOWEVER, SUPPORTED THE ORDERS OF THE AUTHORITIES BELOW AND SUBMITTED THAT THE ASSESSEE HAS FAI LED TO FILE SUPPORTING EVIDENCE BEFORE THE AUTHORITIES BELOW A ND IT IS ALSO NOT CLEAR AS TO WHETHER THE ASSETS, WHICH THE ASSESSEE H AS ALLEGEDLY AGREED TO SELL BELONGED TO THE INDIVIDUAL OR HUF ? 5. AS REGARDS THE CIT(A) FINDINGS THAT THE PROPERTY ALLEGEDLY SOLD BY THE ASSESSEE, ARE APPEARING IN THE BALANCE SHEET OF THE HUF, THE LEARNED COUNSEL FOR THE ASSESSEE SUBMI TTED THAT THE ADVANCES WERE REPAID AS THE TRANSACTIONS HAD NOT MATERIALISED AND THEREFORE, THE PROPERTIES WERE SHOWN AS ASSETS IN THE BALANCE SHEET. 6. HAVING REGARD TO THE RIVAL CONTENTIONS AND THE MATERIAL ON RECORD, I FIND THAT THE ASSESSEE HAS TRIED TO EXPLAIN SOURCE OF THE PEAK CASH CREDIT AS THE OPENING BALANCE OF THE HUF AND ALSO THE SUM OF RS.1,40,000 RECEIVED AS ADVANCE FOR SALE OF PLOT. AS REGARDS THE GENUINENESS OF THE TRANSACTION FOR THE SALE OF PLOT AND REDEMPTION OF THE ADVANCE AMOUNT, THE ASSESSE E IS 5 ITA.NO.1483/HYD/2014 MR. T. CHAKKILAM SRINIVASA RAO, KURNOOL. RELYING UPON THE ADDITIONAL EVIDENCE FILED BEFORE US . THE OTHER ADDITIONAL EVIDENCE PERTAINS TO THE SUM OF RS. 5 LAKH S WHICH HAS ALLEGEDLY BEEN REPAID BY THE ASSESSEE. SINCE THE ADD ITIONS OF PEAK CASH CREDIT AND ALSO CLEARING CREDITS OF RS.6,40,000 ARE INTER- LINKED, I DEEM IT FIT AND PROPER TO ADMIT THE ADDITIONAL EVIDENCE AND REMAND THE ISSUE TO THE FILE OF THE ASSESSING OFFI CER FOR RE- CONSIDERATION, MORE PARTICULARLY, SINCE IT IS THE CONTEN TION OF THE ASSESSEE THAT THE ADVANCES HAVE BEEN RECEIVED BY HIM B Y WAY OF CHEQUES AND THE PAYMENT HAS BEEN MADE BY WAY OF CASH. THUS, BOTH THE GROUNDS OF APPEAL ARE REMITTED TO THE FILE OF THE ASSESSING OFFICER. 7. IN THE RESULT, ASSESSEES APPEAL IS TREATED AS ALL OWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 24.08.2016. SD/- (SMT. P. MADHAVI DEVI) JUDICIAL MEMBER HYDERABAD, DATED 24 TH AUGUST, 2016 VBP/- COPY TO : 1. MR. T. CHAKKILAM SRINIVASA RAO, 45 - 203A - 55, VENKATARAMANA COLONY, KURNOOL. 2. THE INCOME TAX OFFICER, WARD - 1, KURNOOL. 3. CIT(A) - IV, HYDERABAD. 4. CIT - III, HYDERABAD. 5. D.R. ITAT B (SMC) BENCH, HYDERABAD. 6. GUARD FILE