Shri Tanshukhrai N. Gaur, Baroda V. The Income tax Officer,Ward-2(1), Baroda

ITA 1488/AHD/2008

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 6363 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 2 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-07-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Next Hearing Date: 05-07-2011
• Assessment Year: 2002-2003
• Appeal Filed On: 29-04-2008
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: B L YADAV
• Assessee Lawyers: S N SOPARKAR
• Keywords: Unexplained cash credit; Income from undisclosed sources; Opportunity of being heard
• Section: 133A

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCH D BEFORE SHRI D. K. TYAGI, JUDICIAL MEMBER AND SHRI A. K. GARODIA, ACCOUNTANT MEMBER I.T.A. NO. 1488/ AHD/2008 (ASSESSMENT YEAR 2002-03) MR. TANSUKHRAI N. GAUR, 12, ADARSH NAGAR SOCIETY, NEAR CHHANI JAKAT NAKA, VADODARA 390 002 VS. CIT(A) II, BARODA PAN/GIR NO. : AEBPG0408B (APPELLANT) .. (RESPONDENT) APPELLANT BY: SHRI S.N. SOPARKAR, AR RESPONDENT BY: SHRI B. L. YADAV, DR O R D E R PER SHRI A. K. GARODIA, AM:- THIS APPEAL BY THE ASSESSEE HAS BEEN DIRECTED AGAI NST THE ORDER OF LD. CIT(A) II, BARODA, DATED 04.02.2008 FOR THE ASSESSM ENT YEAR 2002-03. THE ONLY EFFECTIVE GROUND RAISED BY THE ASSESSEE IS AS UNDER: THE LD. A.O. HAS ERRED IN ADDING RS.40,30,825/- U/ S 68 FOR UNEXPLAINED CASH CREDITS. THE APPELLANT HAS ALREAD Y EXPLAINED HT SOURCE OF RS.40,30,825/- AND HENCE THE DISALLOWANCE IS UNJUST. 2. THE BRIEF FACTS TILL THE ASSESSMENT STAGE ARE NO TED BY THE CIT(A) IN PARA 3.1 OF HIS ORDER, WHICH ARE REPRODUCED BELOW: SURVEY IN THIS CASE WAS CONDUCTED U/S. 133A ON 11 JANUARY 2002 AND THE STATEMENT OF THE APPELL ANT WAS RECORDED WHEREIN ASSESSEE DISCLOSED RS.54,82,331/- A S ADDITIONAL INCOME. DURING THE COURSE OF ASSESSMENT P ROCEEDINGS, I.T.A.NO.1488/AHD/2008 2 ASSESSING OFFICER EXAMINED THE ISSUE. THE TOTAL OUTGOINGS OF RS.44,42,425/- WERE VERIFIED AND RECALCULATED AFT ER INCORPORATING THE SUBMISSIONS OF THE ASSESSEE, THE POINTS RAISED IN THE AFFIDAVIT AND PHYSICAL VERIFICATION OF IMPOUNDED MATERIALS. THE A SSESSEE VIDE PAGE 11 OF HIS STATEMENT DATED 11.01.2002 AC CEPTED THAT HE HAS PAID ON-MONEY OF RS,10,03,000/- FOR PL OT OF LAND OF 6000 SQUARE FEET AND MADE CASH EXPENDITURE OF RS.76,385 /- THEREON. THERE ARE ENTRIES ON VARIOUS DATES OF PAYMENT OF UNACCOUNTED MONEY FOR LAND ON PAGE 19, 68, 42, 41 OF ANNEXURE A /4 IMPOUNDED DURING THE SURVEY. THUS, INVESTMENT OF RS.18,00,0 00/- IS FOUND TO BE PATENT, PAYMENT OF GOSHALA RS.1,29 ,590/-, DEPOSITORS AS PER PERSONAL CASH BOOK RS.9,95,000/- AND INTEREST RECEIVABLE OF RS.11,21,450/- FINDS SUPP ORT FROM ANNEXURE 5 AND ADDITIONS ARE MADE AS DISCUSSED IN PARA 4.2, 4.3. SIMILARLY, HUNDIS OF RS.3,20,000/- WERE FOUND AT ANNEXURE A/11 . THE ASSESSEE COULD NOT EXPLAIN THE SOURCE OF ACCOUNTING IN THE C ASH BOOK. THE ASSESSEE HAS STATED ON PAGE 7 AND 8 OF THE STATEMEN T DATED 18.01.2002 THAT THE TRANSACTIONS WITH BHAKTI FINANC E AND M/S. KETUL CHEM RECORDED IN THE KUCCHA CASH BOOK ARE NOT ENTER ED IN THE PACCA CASH BOOK. IT HAS BEEN STATED THAT CASH IS EXCHANGE D FOR CHEQUES. THIS STATEMENT IS OF UTMOST IMPORTANT BECAUSE IT HA S BEEN GIVEN IN PRESENCE OF SHRI O P RATHI, THE THEN AUTHORISED REP RESENTATIVE OF THE ASSESSEE WHO HAS SIGNED THE STATEMENT ALSO. HENCE, OUT OF THE CASH FLOW STATEMENT, AMOUNT OF RS.44,42,425/- LESS RS.1, 16,600/- SCRAP SALES REFLECTED IN THE RETURN OF INCOME AMOUNTING T O RS.43,30,825/- WAS TREATED AS UNACCOUNTED INCOME OUT OF THE CASH F LOW STATEMENT GIVEN BY THE ASSESSEE IN HIS STATEMENT U/S.131 DATE D 23.01.2002. 3. BEING AGGRIEVED, ASSESSEE CARRIED THE MATTER IN APPEAL BEFORE LD. CIT(A), WHO ALLOWED RELIEF OF ONLY RS.3 LACS AND CO NFIRMED THE BALANCE ADDITION. NOW, THE ASSESSEE IS IN FURTHER APPEAL B EFORE US. 4. IT IS SUBMITTED BY THE LD. COUNSEL FOR THE ASSES SEE THAT ON PAGE 3 OF THE ASSESSMENT ORDER, THE A.O. HAS REPRODUCED ONE CASH FLOW FORMING PART OF THE STATEMENT DATED 23.01.2002 AS PER WHICH CASH SHORTA GE HAS BEEN WORKED OUT OF RS.54,75,498/-. IT IS SUBMITTED THAT 2 ND CASH FLOW STATEMENT IS REPRODUCED BY THE A.O. ON PAGE 5 OF THE ASSESSMENT ORDER IN WH ICH CASH SHORTAGE IS WORKED OUT AT RS.31,72,898/- AND ONE MORE CASH FLOW STATEMENT HAS BEEN I.T.A.NO.1488/AHD/2008 3 NOTED BY THE A.O. ON PAGES 7 & 8 OF THE ASSESSMENT ORDER AS PER WHICH THE A.O. HAS WORKED OUT CASH SHORTAGE OF RS.44,42,425/- FOR WHICH ADDITION HAS BEEN MADE BY THE A.O. IT IS SUBMITTED THAT IN ALL THE CASH FLOW STATEMENTS, CASH SHORTAGE HAS BEEN WORKED OUT BY THE A.O. AFTER CONSIDERING ALLEGED CASH PAYMENT FOR LAND AT DHUMAD OF RS.18 LACS. IN THIS REGARD, OUR ATTENTION WAS DRAWN TO THE AFFIDAVIT OF THE ASSESSEE DATED 29 .01.2002, WHICH IS AVAILABLE ON PAGES 8-16 OF THE PAPER BOOK AND IN PA RTICULAR, OUR ATTENTION WAS DRAWN TO PAGE 8 OF THIS AFFIDAVIT AS AVAILABLE ON PAGE 14 OF THE PAPER BOOK. IT IS SUBMITTED THAT IT IS STATED BY THE ASS ESSEE IN THE AFFIDAVIT THAT CASH TAKEN FOR PURCHASE OF LAND HAS BEEN BROUGHT BACK BE CAUSE TRANSACTION OF PURCHASE OF LAND DID NOT MATERIALIZE. IT WAS THE S UBMISSION OF THE LD. COUNSEL FOR THE ASSESSEE THAT THE A.O. HAS COMPLETE D THE ASSESSMENT BY DISREGARDING VARIOUS CONTENTIONS RAISED BEFORE HIM. THESE ADDITIONS WERE MADE BY THE A.O. AND CONFIRMED BY THE LD. CIT(A) WI THOUT BRINGING ON RECORD ANY MATERIAL TO SHOW THAT THE ASSESSEE IN FA CT HAS PURCHASED ANY LAND AT DHUMAD AS HAS BEEN ALLEGED. IT IS SUBMITTED THA T IN THIS MANNER, ON OTHER ASPECTS ALSO, THE SUBMISSIONS OF THE ASSESSEE WERE DISREGARDED. IT WAS HIS SUBMISSION THAT IN THE INTEREST OF JUSTICE, THE MAT TER MAY BE RESTORED BACK TO THE FILE OF THE A.O. FOR A FRESH DECISION AFTER EXA MINING ALL THE CONTENTIONS RAISED BEFORE THE A.O. 5. AS AGAINST THIS, LD. D.R. SUPPORTED THE ORDERS O F AUTHORITIES BELOW. 6. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS, PERUSE D THE MATERIAL ON RECORD AND HAVE GONE THROUGH THE ORDERS OF AUTHORIT IES BELOW. WE FIND THAT ONE OF THE ITEMS OF CASH OUTGOING ON THE BASIS OF W HICH THE A.O. HAS FINALLY WORKED OUT THE CASH SHORTAGE OF RS.44,42,425/-, IS ALLEGED CASH PAYMENT FOR PURCHASE OF LAND AT DHUMAD OF RS.18 LACS. WITH REG ARD TO THIS, THE ASSESSEE HAS GIVEN AN AFFIDAVIT TO THE A.O. IN WHICH IT HAS BEEN STATED BY THE ASSESSEE THAT CASH TAKEN FOR THE PURCHASE OF LAND HAS BEEN B ROUGHT BACK BECAUSE THE I.T.A.NO.1488/AHD/2008 4 TRANSACTION OF PURCHASE DID NOT MATERIALIZE. HENCE , WE ARE OF THE CONSIDERED ONION THAT THE A.O. SHOULD HAVE BROUGHT ON RECORD S OME MATERIAL TO SHOW THAT THE ASSESSEE HAS IN FACT PURCHASED SOME LAND A T DHUMAD IN THE RELEVANT YEAR. THE A.O. HAS NOT BROUGHT OUT ON RECORD ANY S UCH MATERIAL TO THIS EFFECT. BUT AT THE SAME TIME, IT IS ALSO REQUIRED TO BE EXAMINED AS TO WHETHER THE ASSESSEE IS IN A POSITION TO EXPLAIN THE SOURCE OF SUCH CASH OF RS.18 LACS TAKEN BY THE ASSESSEE FOR THE PURCHASE OF LAND ON T HE RELEVANT DATE BECAUSE IN THE AFFIDAVIT OF THE ASSESSEE ALSO, THE ASSESSEE HA S ADMITTED THAT CASH WAS TAKEN BY HIM FOR PURCHASE OF LAND BUT THE SAME HAS BEEN BROUGHT BACK BECAUSE THE TRANSACTION OF PURCHASE DID NOT MATERIA LIZE. HENCE, THE ASSESSEE HAS TO SHOW THAT FOR THE CASH TAKEN BY HIM FOR PURC HASE OF LAND AND SUBSEQUENTLY BROUGHT BACK BY HIM FOR THE REASON THA T THE PURCHASE DID NOT MATERIALIZE, THE ASSESSEE IS IN A POSITION TO EXPLA IN THE SOURCE OF SUCH CASH ON THE RELEVANT DATE TO BE SUPPORTED BY COGENT EVIDENC E. HENCE, WE FEEL THAT IN THE INTEREST OF JUSTICE, THE MATTER SHOULD GO BACK TO THE FILE OF THE A.O. FOR A FRESH DECISION ON ALL THE ISSUES. THEREFORE, WE SE T ASIDE THE ORDER OF LD. CIT(A) AND RESTORE THE MATER BACK TO THE FILE OF TH E A.O. FOR A FRESH DECISION AFTER ALLOWING ADEQUATE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. THE A.O. SHOULD PASS A SPEAKING ORDER. 7. IN THE RESULT, THE APPEAL OF THE ASSESSEE STANDS ALLOWED FOR STATISTICAL PURPOSES. 8. ORDER PRONOUNCED IN THE OPEN COURT ON THE DATE O F HEARING I.E. ON 06 TH JULY 2011. SD./- SD./- (D. K. TYAGI) (A. K. GARODIA) JUDICIAL MEMBER ACCOUNTANT MEMBER AHMEDABAD; DATED : 06 TH JULY, 2011 SP I.T.A.NO.1488/AHD/2008 5 COPY OF THE ORDER FORWARDED TO: 1. THE APPLICANT 2. THE RESPONDENT 3. THE CIT CONCERNED 4. THE LD. CIT (APPEALS) 5. THE DR, AHMEDABAD 6. THE GUARD FILE 1. DATE OF DICTATION. 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER.. OTHER MEMBER 3. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR. P .S./P.S. 4. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE D ICTATING MEMBER FOR PRONOUNCEMENT 5. DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR. P.S./P.S. 6. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 7. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK .. 8. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT RE GISTRAR FOR SIGNATURE ON THE ORDER . 9. DATE OF DESPATCH OF THE ORDER. ..