P.Balaprakash, CHENNAI V. ITO, Pollachi

ITA 1604/CHNY/2013

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 73630 (ITAT-CHENNAI)
• Duration Of Justice: 5 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-01-2014
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: D
• Next Hearing Date: 09-12-2013
• Assessment Year: 2008-2009
• Appeal Filed On: 29-07-2013
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: DAS G UPTAJCIT
• Assessee Lawyers: S SRIDHAR
• Keywords: Speculation loss
• Section: 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH, CHENNAI (BEFORE SHRI A.MOHAN ALANKAMONY, ACCOUNTANT MEMBER AND SHRI CHALLA NAGENDRA PRASAD, JUDICIAL MEMBER ) .. I.T.A. NO.1604/MDS/2013 ASSESSMENT YEAR : 2008-09 MR.P.BALAPRAKASH, OLD NO.17, NEW NO.25, VENKATARAMAPURAM STREET, POLALCHI 642 001. PAN : AEZPB 7869 R (APPELLANT) V. ITO,WARD 1(2), POLALCHI. (RESPONDENT) APPELLANT BY : SHRI S.SRIDHAR,ADVOCATE RESPONDENT BY : SHRI DAS G UPTA,JCIT D.R. DATE OF HEARING : 09.12.13 DATE OF PRONOUNCEMENT : 17.01.14 O R D E R PER A.MOHAN ALANKAMONY , ACCOUNTANT MEMBER: THIS APPEAL IS FILED BY THE ASSESSEE, AGGRIEVED BY THE ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX(A) DATED 28. 06.2013 IN ITA NO.1604/MDS/13 2 ITA NO.183/10-11 PASSED U/S 143(3 ) READ WITH SECTI ON 250 OF THE ACT. 2. THE ASSESSEE HAS RAISED EIGHT ELABORATE GROUNDS IN HIS APPEAL; HOWEVER, THE CRUX OF THE ISSUE IS THAT THE ASSESSEE IS AGGRIEVED BY THE ORDER OF THE LD. CIT(A) FOR HAVEN ING SUSTAINED THE ADDITION MADE BY THE LD. ASSESSING OFFICER FOR `. 5 LAKHS WHICH WERE CASH DEPOSIT MADE BY THE ASSESSEE IN HIS TAMILNADU MERCANTILE BANK ACCOUNT ON 08.01.2008 FOR `. 3 LAKHS AND ON 10.10.08 FOR `. 2 LAKHS. 3. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSE SSEE IS AN INDIVIDUAL, RESIDENT IN INDIA, HAVING INCOME FROM B USINESS AND INCOME FROM OTHER SOURCES, FILED HIS RETURN OF INCOME FOR ASSESSMENT YEAR 2008-09 BELATEDLY ON 21.04.2009 ADMITTING HIS INCOM E AS RS.2,23,991/-. UNDER CASS THE CASE WAS SELECTED FOR SCRUTINY AND ASSESSMENT WAS MADE ON 22.12.2010 WHEREIN THE ABOVE STATED ADDITION WAS MADE. WHILE MAKING THE ADDITION, LD. ASSESSING OFFICER OBSERVED THAT IN SPITE OF AMPLE OPPORTUNITIES AFFOR DED TO ASSESSEE, NO ITA NO.1604/MDS/13 3 EXPLANATION HAS BEEN GIVEN FOR THE CASH CREDITS INT RODUCED BY THE ASSESSEE; HOWEVER THE ASSESSEE HAD ONLY REQUESTED F OR SETTING OFF THE SPECULATIVE LOSS AGAINST THE SPECULATIVE INCOME OFFERED. THE LD. CIT(A) CONFIRMED THE ORDER OF THE LD. ASSES SING OFFICER BY OBSERVING AS UNDER:- 6.1. IN THE GROUNDS OF APPEAL THE ASSESSEE HAS STA TED THAT SOURCE OF DEPOSITS ARE OF SPECULATION INCOME, IF THIS IS THE CASE THE ASSESSEE HAS TO SUBSTANTIATE HIS ARGUMENT BY WAY OF COMMODITY IN WH ICH HE HAS TRANSACTED THE COMMODITY EXCHANGE WHICH HAS CARRIED OUT THE TRANSA CTION AND MOST IMPORTANTLY CONTRACT NOTES AND THE RECEIPT BY WAY OF CHEQUE FRO M THESE TRANSACTIONS. THE ASSESSEE HAS CLEARLY FAILED TO PRODUCE THE SAME BEF ORE THE AO DURING THE COURSE OF ASSESSMENT AS WELL AS DURING THE OPPORTUNITY GI VEN TO HIM IN THE COURSE OF APPEAL. THEREFORE, IT IS EVIDENT THAT THE CLAIM OF THE ASSESSEE IS MERELY AN AFTERTHOUGHT. IT MAY ALSO BE POINTED OUT THAT ANY S PECULATION GAIN ARISING FROM COMMODITY TRADE CAN BE CREDITED ONLY BY WAY OF CHEQ UE FROM THE COMMODITIES BROKER. HERE THE ASSESSEE HAS CREDITED IN HIS BANK ACCOUNT ARE RS.3 LAKHS BY CASH ON 08/1/2008 AND RS.2 LAKHS BY CASH ON 10/10/2 008 THESE CASH TRANSACTIONS CANNOT BE SEEN AS CREDITS ARISING FROM HIS SPECULATION TRANSACTION. THEREFORE, I AM IN AGREEMENT WITH THE AO THAT THE E NTRIE CASH CREDIT OF RS.5 LAKHS CREDITED AS ABOVE WILL BE TREATED AS UNDISCLOSED CA SH CREDIT U/S. 68 OF THE INCOME TAX ACT AND IS CONFIRMED IN THE HANDS OF THE APPELLANT. 4. BEFORE US, LD. A.R. REITERATED HIS SUBMISSION BEFORE THE REVENUE ON THE EARLIER OCCASIONS BY STATING THAT TH E SOURCE OF DEPOSITS ARE UNDISCLOSED SPECULATIVE INCOME AND THE REFORE THE SAME ITA NO.1604/MDS/13 4 MAY BE SET OFF AGAINST HIS SPECULATIVE LOSSES. FURT HER LD. A.R. STATED THAT IF THE ABOVE SUBMISSIONS OF THE ASSESSEE ARE N OT ACCEPTED, THEN AT LEAST A LENIENT VIEW MAY BE TAKEN KEEPING IN VIE W OF HIS PERSONAL SAVINGS FOR THE AMOUNT INTRODUCED. LD. D.R VEHEME NTLY OPPOSED TO THE SUBMISSIONS OF THE LD. A.R. BY POINTING OUT THA T NO EVIDENCE WAS PRODUCED BY THE ASSESSEE BEFORE THE REVENUE IN ORDE R TO ESTABLISH HIS STAND. THEREFORE, IT WAS PRAYED THAT THE ORD ERS OF REVENUE MAY BE CONFIRMED. 5. WE HAVE HEARD THE BOTH PARTIES AND CAREFULLY PER USED THE MATERIALS AVAILABLE ON RECORD. FROM THE RECORDS P RODUCED BEFORE US, IT IS APPARENT THAT THERE IS NO EVIDENCE TO SUGGEST THAT THE ASSESSEE HAD EARNED INCOME FROM SPECULATIVE TRANSACTION. HO WEVER, ON VERIFYING THE STATEMENT OF ACCOUNTS SUBMITTED BY TH E ASSESSEE, WE FIND THAT THE ASSESSEE HAS DECLARED INCOME FOR THE ASSESSMENT YEAR 2007-08 OF `. 1,96,747/- AND `. 2,23,999/- FOR THE ASSESSMENT YEAR 2008-09. THEREFORE, IN THE INTEREST OF JUSTICE TAKI NG A LENIENT VIEW WE ARE OF THE OPINION THAT IT COULD BE PRESUMED TH AT THE ASSESSEE ITA NO.1604/MDS/13 5 WOULD HAVE SOURCE OF `. 2 LAKHS AS SAVINGS FROM HIS PAST INCOME. ACCORDINGLY, WE HEREBY SUSTAIN THE ADDITION FOR AN AMOUNT OF `. 3 LAKHS AS INCOME TAXABLE U/S. 68 OF THE ACT. 6. IN THE RESULT, THE APPEAL OF ASSESSEE IS PARTLY ALLOWED. ORDER PRONOUNCED ON 17 TH JANUARY, 2014 AT CHENNAI. SD/- SD/- (CHALLA NAGENDRA PRASAD ) (A.MOHAN ALANKAMONY ) JUDICIAL MEMBER ACCOUNTANT MEMBER CHENNAI, DATED THE 17 TH JANUARY, 2014. K S SUNDARAM. COPY TO: ASSESSEE/AO/CIT (A)/CIT/D.R./GUARD FILE