Smt. Nayanaben Bhupendrabhai Galani, Surat V. The Income tax Officer,(OSD)Range-9, Surat

ITA 1556/AHD/2010

• Counselvise Citation: [2010] 136 COUNSELVISE.COM (IT) 5875 (ITAT-AHMEDABAD)
• Duration Of Justice: 1 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-07-2010
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: SMC
• Next Hearing Date: 08-07-2010
• Assessment Year: 2003-2004
• Appeal Filed On: 11-05-2010
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: P R GHOSH
• Assessee Lawyers: M K PATEL
• Keywords: Reopening of assessment; Unexplained cash credit
• Section: 133A; 147; 68; 69; 148

Judgement Text

- 1 - IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCH SMC AHMEDABAD BEFORE SHRI D.C.AGRAWAL, ACCOUNTANT MEMBER SMT. NAYANABEN BHUPENDRABHAI GALANI, 59, GURUNAGAR SOCIETY, VARACHHA ROAD, SURAT. VS. INCOME-TAX OFFICER (OSD), RANGE-9, SURAT. (APPELLANT) .. (RESPONDENT) ASSESSEE BY :- SHRI M. K. PATEL, AR REVENUE BY:- SHRI P. R. GHOSH, DR O R D E R PER D. C. AGRAWAL, ACCOUNTANT MEMBER . THIS IS AN APPEAL FILED BY THE ASSESSEE RAISING FO LLOWING GROUNDS :- (1) ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE A S WELL AS LAW ON THE SUBJECT, THE LD. CIT(A) HAS ERRED CONFIRMING THE ACTION OF THE AO ISSUING NOTICE U/S 148 OF THE ACT AND RE-OPE NING THE ASSESSMENT. (2) ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE A S WELL AS ON THE SUBJECT, THE LD. CIT(A) HAS ERRED CONFIRMING TH E ACTION OF THE AO IN MAKING ADDITION OF RS.3,25,200/- ON ACCOU NT OF ALLEGED UNEXPLAINED CASH CREDIT U/S 68 OF THE I.T. ACT, 1961. 2. THE FACTS OF THE CASE ARE THAT ORIGINAL RETURN O F INCOME WAS ACCEPTED AT AN INCOME OF RS.59,300/- BUT IT WAS REO PENED UNDER SECTION 147 ON THE BASIS OF MATERIAL FOUND DURING THE COURS E OF SURVEY UNDER SECTION 133A AT THE PREMISES OF SHRI PANKAJ DANAWAL A, CHARTERED ITA NO.1556/AHD/2010 ASST. YEAR :2003-04 2 ACCOUNT, WHO HAS BEEN FOUND TO BE INDULGING IN INFL ATING BOGUS CAPITAL BY PREPARING BOGUS PROFIT AND LOSS ACCOUNT AND BALA NCE SHEET WITH AGRICULTURAL INCOME, SHOWING RECEIPTS FROM SMALL GI FTS OR SHOWING INCOME FROM INTEREST, BROKERAGE, COMMISSION ETC., OR BY SH OWING BOGUS NON- TAXABLE INCOME OR INCOME BELOW TAXABLE LIMIT. THE M ATERIAL FOUND DURING THE COURSE OF SURVEY AT THE PREMISES OF SHRI PANKAJ DANAWALA WAS FORWARDED TO THE AO. SCRUTINY OF THE IMPOUNDED MATE RIAL REVEALED THAT THE ASSESSEE IS MAINTAINING A SAVINGS BANK A/C NO.1 03562 WITH ALLAHABAD BANK, SURAT WHEREIN FOLLOWING DEPOSITS IN CASH WERE FOUND :- IT WAS FURTHER NOTICED THAT CASH SO DEPOSITED WAS T RANSFERRED TO SOME OTHER ACCOUNTS. THE AO ALSO NOTICED THAT LOANS AND ADVANC ES SHOWN IN THE BALANCE SHEET ARE BOGUS/FICTITIOUS. THE ASSESSEE DI D NOT FURNISH ANY SATISFACTORY EXPLANATION OF CASH DEPOSIT IN HER BAN K ACCOUNT AND ACCORDINGLY ASSESSMENT WAS REOPENED BY THE AO. 3. THE REOPENING OF THE ASSESSMENT WAS CONFIRMED BY THE LD. CIT(A) ON THE GROUND THAT ASSESSEE NEITHER SUBMITTED NOR F ILED ANY SUBMISSION DURING THE COURSE OF ASSESSMENT PROCEEDINGS. THE SO URCES OF DEPOSITS IN THE BANK ACCOUNT WERE NOT EXPLAINED AND ACCORDINGLY INCOME WAS HELD AS ESCAPED ASSESSMENT. DATE AMOUNT (RS.) REMARKS 22.07.2002 15,500 BY CASH 29.07.2002 20,700 BY CASH 05.08.2002 9,700 BY CASH 09,08,2002 9,300 BY CASH 02.09.2002 10,000 BY CASH 03.09.2002 1,10,000 BY TRAN. A/C 23.09.2002 1,50,000 BY TRAN.A/C TOTAL 3,25,200 3 4. I HAVE HEARD THE LD. AR AND THE LD. DR ON THE IS SUE. IN MY CONSIDERED VIEW, REOPENING OF ASSESSMENT WAS JUSTIF IED BECAUSE ASSESSEE HAS NOT FURNISHED ANY EXPLANATION IN THE RETURN OF INCOME ORIGINALLY FILED OR SUBSEQUENT THERETO AS TO THE SOURCES OF DEPOSITS OF RS.3,25,200/- IN CASH IN THE BANK ACCOUNT. THUS A PRIMA FACIE SATISF ACTION IS CORRECTLY ARRIVED AT BY THE AO AS TO THE ESCAPEMENT OF ASSESS MENT. ALL THE THREE INGREDIENTS FOR ISSUANCE OF NOTICE UNDER SECTION 14 8(1) ARE SATISFIED. THERE IS NO DOUBT ABOUT ASSESSEE AND ASSESSMENT YEA R AND SIMILARLY THERE IS ALSO A CHARGE OF ESCAPEMENT OF ASSESSMENT TO THE EXTENT OF RS.3,25,200/- BEING THE CASH DEPOSIT IN THE BANK AN D REMAINED PRIMA FACIE UNEXPLAINED AT THE POINT OF TIME OF RE-ASSESSMENT. THIS GROUND OF ASSESSEE IS ACCORDINGLY REJECTED. 5. REGARDING ADDITION OF RS.3,25,200/- APPARENTLY E XPLANATION HAS NOT BEEN FURNISHED EITHER BEFORE THE AO OR BEFORE THE L D. CIT(A). THE LD. CIT(A) HAS MENTIONED THAT ASSESSMENT IN THE CASE OF PRESENT ASSESSEE HAS BEEN MADE ON PROTECTIVE BASIS WHEREAS SUBSTANTIVE A SSESSMENT HAS BEEN MADE IN THE HANDS OF BENEFICIARIES IN WHOSE ACCOUNT MONEY WAS FINALLY TRANSFERRED. 6. AFTER HEARING BOTH THE PARTIES I AM OF THE VIEW THAT INITIAL POINT OF DEPOSIT IS BANK ACCOUNT THEREFORE, ONUS LIES ON THE ASSESSEE TO EXPLAIN. IF HE/SHE IS NOT ABLE TO EXPLAIN OR EXPLANATION FURNIS HED BY HIM/HER IS NOT SATISFACTORY THEN ADDITION HAS TO BE MADE IN HIS/HE R HANDS. SUBSEQUENTLY WHEN MONEY IS TRANSFERRED ELSEWHERE, THEN IN THE HA NDS OF THAT ASSESSEE, MONEY WOULD BE EXPLAINED AS COMING COMING FROM PRES ENT ASSESSEE. NOTWITHSTANDING WHETHER MONEY AT THE FINAL DESTINAT ION IS TREATED AS EXPLAINED OR NOT, SO FAR AS THIS ASSESSEE IS CONCER NED, THE DEPOSIT IN THE BANK ACCOUNT REMAINED UNEXPLAINED AND, THEREFORE, A DDITION UNDER SECTION 4 69 IS JUSTIFIED. EVEN THOUGH AO HAS MADE THE ADDITI ON U/S 68 BUT IN REALITY IT SHOULD BE U/S 69 AS MONEY IS FOUND DEPOS ITED IN BANK ACCOUNT AND, THEREFORE, IT IS HER INVESTMENT WHICH IS NOT E XPLAINED. THERE IS NO CREDIT ENTRY FOUND IN THE BOOKS OF ACCOUNT MAINTAIN ED BY THE ASSESSEE. ACCOUNT BOOKS OF THE BANK CANNOT BE TREATED AS BOOK S OF ACCOUNT OF THE ASSESSEE. THEREFORE, ADDITION U/S 68 CANNOT BE MADE BUT ALTERNATIVELY ADDITION U/S 69 IS CONSIDERED AND FOUND TO BE SUSTA INABLE. 7. AS A RESULT, I DISMISS THE APPEAL FILED BY THE A SSESSEE. ORDER WAS PRONOUNCED IN OPEN COURT ON 8/7/2010 SD/- (D.C.AGRAWAL) ACCOUNTANT MEMBER AHMEDABAD, DATED : 8/7/2010 MAHATA/- COPY OF THE ORDER FORWARDED TO :- 1. THE ASSESSEE. 2. THE REVENUE. 3. THE CIT(APPEALS)- 4. THE CIT CONCERNS. 5. THE DR, ITAT, AHMEDABAD 6. GUARD FILE. BY ORDER, DEPUTY / ASSTT.REGISTRAR ITAT, AHMEDABAD