Neelamegan Munuzwami, CHENNAI V. ITO, CHENNAI

ITA 156/CHNY/2016

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 9673 (ITAT-CHENNAI)
• Duration Of Justice: 2 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-04-2016
• Appeal Filed By: Assessee
• Bench Allotted: A
• Next Hearing Date: 23-03-2016
• Assessment Year: 2009-2010
• Appeal Filed On: 28-01-2016
• Court: TRIBUNAL
• Department Lawyers: P RADHAKRISHNAN
• Assessee Lawyers: B RAGHAV PRASAD
• Keywords: Unexplained cash credit; Gift
• Section: 68; 6

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH : CHENNAI . . . , . ! , ' # $ [ BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER ] ./ I.T.A.NO.156/MDS/2016 / ASSESSMENT YEAR : 2009-10 SHRI NEELAMEGAN MUNUSWAMI F5, FIRST FLOOR, B.S.APARTMENT NO.70, KODAMBAKKAM ROAD SAIDAPET, CHENNAI 600 015 VS . THE INCOME TAX OFFICER NON-CORPORATE WARD 17(5) CHENNAI [PAN AJ B PM 9737 C ] ( %& / APPELLANT) ( '(%& /RESPONDENT) / APPELLANT BY : SHRI B. RAGHAV PRASAD, CA /RESPONDENT BY : SHRI P. RADHAKRIS HNAN, JCIT / DATE OF HEARING : 23 - 03 - 2016 ! / DATE OF PRONOUNCEMENT : 13 - 04 - 2016 / O R D E R PER N.R.S.GANESAN, JUDICIAL MEMBER THIS APPEAL OF THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE COMMISSIONER OF INCOME-TAX (APPEALS)-5, CHENNAI , DATED 29.12.2015 AND PERTAINS TO ASSESSMENT YEAR 2009-10. 2. SHRI RAGHAV PRASAD, LD. REPRESENTATIVE FOR THE ASS ESSEE SUBMITTED THAT ON THE BASIS OF THE ANNUAL INFORMATI ON REPORT RECEIVED FROM ICICI BANK, THE ASSESSING OFFICER FOUND THAT A SUM OF ` 16,05,381/- WAS DEPOSITED IN CASH IN THE SB ACCOUNT OF THE ASSESSEE IN ICICI BANK. THE ASSESSEE EXPLAINED BEFORE THE ASSESSING OFFICER ITA NO. 156/16 :- 2 -: THAT THE MONEY WAS DEPOSITED IN THE ICICI BANK AFTE R WITHDRAWAL FROM OTHER BANK WHERE THE ASSESSEE WAS MAINTAINING SAL ARY ACCOUNT AND OTHER INTER-TRANSFER FUNDS FROM OTHER BANKS. THE ASSESSEE ALSO EXPLAINED THAT HE HAS ACCUMULATED FUNDS TO THE EXTE NT OF ` 2 LAKHS BESIDES GIFT RECEIVED HIS FATHER-IN-LAW, SHRI THIRU VENGADAM, WHO IS A RETIRED BLOCK DEVELOPMENT OFFICER. ACCORDING TO TH E LD. REPRESENTATIVE, THE ASSESSEE RECEIVED FUNDS FOR PU RCHASING HIS RESIDENTIAL FLAT DURING THE YEAR UNDER CONSIDERATIO N. THE ASSESSEE HAS ALSO RAISED A JEWEL LOAN OF ` 1,11,800/-. HOWEVER, THE ASSESSING OFFICER FOUND THAT THE ASSESSEE HAS FURNISHED INSU FFICIENT PARTICULARS AND THE TIME LIMIT FOR COMPLETING THE ASSESSMENT IS GETTING BARRED, THEREFORE, HE TREATED THE SUM OF ` 12,72,000/- AS UNEXPLAINED CASH CREDIT U/S 68 OF THE ACT. ACCORDING TO THE LD. RE PRESENTATIVE, THE ASSESSEE HAS FURNISHED ALL THE DETAILS FOR COMPLETI NG THE ASSESSMENT. THE ASSESSING OFFICER COULD NOT EXAMINE THE SAME FO R WANT OF TIME. THEREFORE, MERELY BECAUSE THE ASSESSING OFFICER HAS NO TIME TO EXAMINE THE MATERIALS FILED, THAT CANNOT BE A REA SON FOR MAKING THE ADDITION U/S 68 OF THE ACT. 3. REFERRING TO SEC.68 OF THE ACT, THE LD. REPRESENTAT IVE SUBMITTED THAT SEC. 68 DOES NOT APPLY TO THE AMOUNT S CREDITED IN THE BANK ACCOUNT OF THE ASSESSEE. ACCORDING TO THE LD . REPRESENTATIVE, SEC. 68 IS FOR THE CREDIT FOUND IN THE BOOKS OF ACC OUNT MAINTAINED IN ITA NO. 156/16 :- 3 -: THE REGULAR COURSE. IN THIS CASE, NO CREDIT WAS FO UND IN THE BOOKS OF ACCOUNT MAINTAINED BY THE ASSESSEE. IN FACT, THE CREDIT WAS FOUND IN THE BOOKS OF ACCOUNT MAINTAINED BY ICICI BANK. THE LD. REPRESENTATIVE FURTHER SUBMITTED THAT THE ASSESSEE IS A SALARIED EMPLOYEE RETIRED AS BRANCH MANAGER OF HDFC STANDARD LIFE INSURANCE CO. LTD. THERE IS NO COMPULSION UNDER THE INCOME-T AX ACT, 1961 TO MAINTAIN BOOKS OF ACCOUNT BY THE SALARIED CLASS. WHEN THE ASSESSEE WAS NOT MAINTAINING ANY BOOKS OF ACCOUNT AND ALL TH E CASH DEPOSITS WERE MADE ONLY IN THE BANK ACCOUNT, ACCORDING TO TH E LD. REPRESENTATIVE, THERE CANNOT BE ANY ADDITION U/S 6 8 OF THE ACT. 4. THE LD. REPRESENTATIVE FURTHER SUBMITTED THAT GENUI NENESS OF THE TRANSACTION IS NOT IN DISPUTE. ALL THE DEPOSIT S WERE MADE IN THE BANK ACCOUNT. SEVERAL DEPOSITS WERE MADE AS INTER- TRANSFER AND CONTRA-DEPOSITS BETWEEN TWO BANKS. WHEN THE FUNDS WERE TRANSFERRED FROM ONE BANK TO ANOTHER, THE ASSESSING OFFICER HAS NO REASON TO DOUBT THE GENUINENESS OF THE TRANSACTION. DURING T HE REMAND PROCEEDINGS BEFORE THE ASSESSING OFFICER, HE HAS NO T COMMENTED ABOUT THE CASH FLOW STATEMENT FILED BY THE ASSESSE E. THEREFORE, ACCORDING TO THE LD. REPRESENTATIVE, THE ADDITION M ADE BY THE ASSESSING OFFICER TO THE EXTENT OF ` 12,72,000/- IS NOT JUSTIFIED. 2. ON THE CONTRARY, SHRI P. RADHAKRISHNAN, LD. DEPARTM ENTAL REPRESENTATIVE SUBMITTED THAT ADMITTEDLY, THE ASSE SSEE IS A RETIRED ITA NO. 156/16 :- 4 -: EMPLOYEE OF M/S HDFC STANDARD LIFE INSURANCE CO. L TD. THE MAIN CONTENTION OF THE ASSESSEE BEFORE THE ASSESSING OF FICER WAS THAT THE ASSESSEE BEING BRANCH MANAGER OF HDFC STANDARD LIFE INSURANCE CO. LTD., USED TO COLLECT CASH FROM THE POLICY HOLDERS AFTER ISSUE OF POLICY AND THAT MONEY WAS DEPOSITED IN HIS BANK ACCOUNT. HOWEVER, NO CASH FLOW STATEMENT WAS FILED BEFORE THE ASSESSING OFFIC ER. REFERRING TO THE ASSESSMENT ORDER, MORE PARTICULARLY PAGE 3, THE LD. DR SUBMITTED THAT THE ASSESSEE HAS NOT GIVEN ANY DETAILS REGARDING T HE POLICY HOLDERS FROM WHOM HE COLLECTED MONEY AND DETAILS OF WITHDRA WALS AND DEPOSITS OF PREMIUM IN THE ACCOUNT. THEREFORE, THE CIT(A) HAS RIGHTLY CONFIRMED THE ORDER OF THE ASSESSING OFFICER. 3. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EITHER SIDE AND ALSO PERUSED THE MATERIAL AVAILABLE ON RECORD. IT IS NOT IN DISPUTE THAT THE ASSESSEE RETIRED AS A BRANCH MANAGER OF HDFC S TANDARD LIFE INSURANCE CO. LTD. IN HIS CAPACITY AS BRANCH MANAG ER OF HDFC STANDARD LIFE INSURANCE CO. LTD., THE ASSESSEE MIG HT HAVE COLLECTED PREMIUM FROM THE POLICY HOLDERS. THE ASSESSING OFF ICER OBSERVED THAT THE DETAILS OF THE COLLECTION WERE NOT FURNISHED BE FORE HIM. NOW THE ASSESSEE CLAIMS BEFORE THIS TRIBUNAL THAT THE ENTIR E DETAILS WERE FURNISHED BEFORE THE CIT(A). HOWEVER, THE CIT(A) H AS NOT CONSIDERED THE SAME. THE FACT REMAINS THAT THERE ARE VARIOUS WITHDRAWALS AND DEPOSITS FROM SB ACCOUNT WITH ICICI BANK. THEREFOR E, GIVING ONE MORE ITA NO. 156/16 :- 5 -: OPPORTUNITY TO THE ASSESSEE TO EXPLAIN THE NATURE OF DEPOSITS AND WITHDRAWALS BEFORE THE ASSESSING OFFICER WOULD NOT PREJUDICE THE INTEREST OF THE REVENUE. THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT GIVING SUCH AN OPPORTUNITY WOULD DEFINITELY PR OMOTE THE CAUSE OF JUSTICE. ACCORDINGLY, THE ORDERS OF THE LOWER AUTH ORITIES ARE SET ASIDE AND THE ENTIRE ADDITION OF ` 12,72,000/- IS REMITTED BACK TO THE FILE OF THE ASSESSING OFFICER. THE ASSESSING OFFICER SHALL REEXAMINE THE ISSUE AFRESH IN THE LIGHT OF THE DETAILS/MATERIALS THAT M AY BE FILED BY THE ASSESSEE WITH REGARD TO WITHDRAWAL AND DEPOSIT OF FUNDS AND THEREAFTER DECIDE THE SAME IN ACCORDANCE WITH LAW A FTER GIVING A REASONABLE OPPORTUNITY TO THE ASSESSEE. 4. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLO WED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 13 TH APRIL, 2016, AT CHENNAI. SD/- SD/- ( . ! ) (A. MOHAN ALANKAMONY) ' / ACCOUNTANT MEMBER ( . . . ' ) (N.R.S. GANESAN) / JUDICIAL MEMBER #$ / CHENNAI %& / DATED: 13 TH APRIL, 2016 RD &' ()*) / COPY TO: 1 . / APPELLANT 4. + / CIT 2. / RESPONDENT 5. ),- . / DR 3. +/' / CIT(A) 6. -01 / GF