Seema Devram Thorat, Hyderabad, Hyderabad V. DCIT, Circle-3(1), Hyderabad, Hyderabad

ITA 1621/HYD/2016

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 2557 (ITAT-HYDERABAD)
• Duration Of Justice: 1 year(s) 1 month(s) 30 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-01-2018
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Assessment Year: 2011-2012
• Appeal Filed On: 01-12-2016
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: SUMAN MALIK
• Assessee Lawyers: K A SAI PRASAD
• Keywords: Unexplained cash credit; Gift; Peak credit

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCHES A (SMC), HYDERABAD BEFORE SHRI B. RAMAKOTAIAH, ACCOUNTANT MEMBER I.T.A. NO. 1621/HYD/2016 ASSESSMENT YEAR: 2011-12 SEEMA DEVRAM THORAT, HYDERABAD [PAN: ACLPT6653P] VS THE DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE-3(1), HYDERABAD (APPELLANT) (RESPONDENT) FOR ASSESSEE : SHRI K.A. SAI PRASAD, AR FOR REVENUE : SMT. SUMAN MALIK, DR DATE OF HEARING : 18-01-2018 DATE OF PRONOUNCEMENT : 31-01-2018 O R D E R THIS IS AN APPEAL BY ASSESSEE AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS)-3, HYDERABAD, DATED 16-09-2016, FOR THE AY. 2011-12. THE GROUND RAISED B Y ASSESSEE IS AS UNDER: 1. THE LEARNED COMMISSIONER OF INCOMETAX (APPEALS) , IN THE FACTS AND CIRCUMSTANCES OF THE CASE, IS NOT JUSTIFI ED IN CONFIRMING THE ADDITION OF RS. 17,86,411/-. GROUND NO. 2 IS GENERAL IN NATURE. 2. BRIEF FACTS OF THE CASE ARE THAT, ASSESSEE IS A DIRE CTOR IN M/S. SAI ENVIRO ENGINEERS PVT. LTD., AND FILED HER RE TURN OF INCOME ON 18-11-2011 ADMITTING INCOME OF RS. 9,58,98 0/-. SHE WAS HAVING TWO BANK ACCOUNTS AS UNDER: I.T.A. NO. 1621/HYD/2016 :- 2 -: I. THE KARUR VYSYA BANK LTD., -A/C NO. 2103155000038 253 II. STATE BANK OF HYDERABAD OVERSEAS BRANCH, HYDERABAD -A/C NO. 62100697663 2.1. THERE WAS CASH DEPOSITS IN THESE TWO BANK ACCOU NTS. THE ASSESSING OFFICER (AO) ENQUIRED INTO SOURCES OF THESE CASH DEPOSITS. IT WAS EXPLAINED BY ASSESSEE DURING THE AS SESSMENT PROCEEDINGS THAT THE SOURCES OF THESE CASH DEPOSITS WER E: I. AMOUNTS RECEIVED FROM HER SISTER; II. AMOUNTS RECEIVED FROM M/S. SAI ENVIRO ENGINEERS PVT. LTD; III. CASH RECEIVED FROM HER FATHER; IV. CASH ON HAND; V. CASH RETURNED FROM THE SUB-CONTRACTOR; AO HOWEVER DID NOT ACCEPT THE SUBMISSIONS AND COMPUTE D THE PEAK OF CASH CREDITS, WHICH WORKED OUT TO RS. 17,86,4 11/-, AND TREATED THE SAME AS UNEXPLAINED CASH CREDITS. 3. BEFORE THE LD.CIT(A), ASSESSEE HAS NOT APPEARED ON TWO OCCASIONS AND ON THE LAST OCCASION, ONE MR. P. SRIRA MAMURTHY, ACCOUNTANT OF THE COMPANY APPEARED. LD.CIT(A) DISMISS ED THE APPEAL STATING AS UNDER: 5. THOUGH SRI P. SRIRAMAMURTHY, ACCOUNTANT OF THE COMPANY APPEARED, HE PLEADED HIS INABILITY TO SUBMIT ANY EV IDENCE WITH REFERENCE TO SOURCES OF CASH DEPOSITS. AS THE SOURCES WERE NOT SATISFACTORILY EXPLAINED THE ASSESSING OFFICER WAS REASONABLE ENOUGH TO ESTI MATE THE PEAK CASH CREDIT AT RS. 17,86,411/- INSTEAD OF TREATING THE E NTIRE CASH DEPOSITS AS UNEXPLAINED. IN THE ABSENCE OF ANY EVIDENCE EXPLAI NING THE SOURCES OF CASH DEPOSITS THE ACTION OF THE ASSESSING OFFICER IS CON FIRMED. I.T.A. NO. 1621/HYD/2016 :- 3 -: 4. LD. COUNSEL SUBMITTED THAT ASSESSEE HAS FURNISHED DETAILED EXPLANATION ON EACH OF THE CASH DEPOSITS AND A LSO PRODUCED THE CASH BOOK BUT THE AO REJECTED THE SAME. REFERRING TO THE DETAILED EXPLANATION, IT WAS SUBMITTED TH AT PEAK CREDIT WORKING SHOULD NOT HAVE BEEN DONE. WITHOU T PREJUDICE TO THE SAME, IT WAS THE CONTENTION THAT THE AMOU NTS RECEIVED ON BEHALF OF THE COMPANY, IN WHICH SHE IS D IRECTOR SHOULD HAVE BEEN EXCLUDED. 5. LD.DR, HOWEVER, RELIED ON THE DETAILED ORDER OF AO . 6. I HAVE CONSIDERED THE RIVAL CONTENTIONS AND PERUSED THE DOCUMENTS PLACED ON RECORD. ASSESSEE HAS EXPLAINED T HE DEPOSITS OF CASH INTO BANK A/C BEFORE THE AO AS UNDER BY THE LETTER DT. 10-02-2014: I. RS. 1,00,000/- WAS GIVEN BY ME TO MY SISTER-IN-LAW DURING THE F.Y. 2009-10 AS HAND LOAN AND THE SAME AMOUNT WAS R ETURNED BACK TO ME BY HER. THIS CASH HAS BEEN DEPOSITED BY ME INTO MY ACCOUNT ON 05/04/2010; II. I HAVE RECEIVED RS. 5,00,000/- CASH FROM OUR CLIENT M/S. WARNA SAHAKARI DUDH UTAPADAK ON 18/04/2010 (SUNDAY) AS FI NAL SETTLEMENT. I HAVE DEPOSITED THIS CASH INTO MY PER SONAL ACCOUNT ON 19/04/2010 AND THEN TRANSFERRED THE SAME TO SAI ENVIRO ENGINEERS PVT. LTD., ACCOUNT ON SAME DAY THROUGH CH EQUE NO. 673155 LEDGER COPY ENCLOSED; III. I HAVE RECEIVED RS. 5,00,000/- CASH FROM MY FATHER AS A GIFT ON 06/05/2010 AND HAVE DEPOSITED THE SAME IN MY PERSON AL ACCOUNT. MY FATHER WAS A RETIRED GOVERNMENT EMPLOY EE AND A PENSIONER WHO ALSO EARNS SOME AGRICULTURAL INCOME T OO. AS MY BROTHER WAS EXPIRED IN THE YEAR 2003 IN AN ACCIDENT MY PARENTS WERE STAYING WITH ME AND I HAVE TAKEN THE RESPONSIB ILITY OF THEIR LIVELIHOOD AND MEDICAL EXPENSES TOO. IN RETU RN MY FATHER HAS GIVEN ME THIS AMOUNT WHICH MAY BE CONSIDERED AS A GIFT- PROOF OF PENSIONER ENCLOSED; I.T.A. NO. 1621/HYD/2016 :- 4 -: IV. I HAVE DEPOSITED RS. 2,50,000/- CASH IN MY ACCOUNT ON 15/09/2010. I HAVE POOLED UP THIS AMOUNT FROM RS. 2,09,000/- CASH WITHDRAWN FROM MY OTHER ACCOUNT (DIRECTOR REMU NERATION AVAILABLE IN SBH ACCOUNT), RS. 25,000/- CASH WITHDR AWN FROM MY ACCOUNT EARLIER AND DEPOSITED THESE AMOUNTS INTO MY KVB ACCOUNT ALONG WITH RS. 16,000/- CASH AVAILABLE WITH ME. STATEMENT ENCLOSED; V. I HAVE RECEIVED CASH OF RS. 1,50,000/- ON 08/09/201 0, RS. 2,50,000/- ON 15/09/10 AND RS. 1,00,000/- ON 06/10/ 2010 TOTAL OF RS. 5,00,000/-. THIS TOTAL AMOUNT OF RS. 5,00,000/- WAS DEPOSITED IN MY ACCOUNT ON 08/10/2010 AND ISSUE D A CHEQUE TO M/S. GSS INFRATECH PVT. LTD. (SUB-CONTRAC TOR OF OUR COMPANY) FOR RS. 5,00,000/- - JV ENCLOSED; VI. I HAVE DEPOSITED RS. 3,60,000/- CASH ON 10/1/2011. I HAVE POOLED UP THIS AMOUNT FROM THE ASH WITHDRAWN EARLIE R I.E., RS. 60,000/- FROM MY SBH ACCOUNT AND RS. 80,000/- WITHD RAWN EARLIER FROM MY KVB ACCOUNT ALONG WITH THE CASH RET URNED BACK BY OUR SUB-CONTRACTOR MR. ZAMEERUDDIN SHAIK (AN ADV ANCE OF RS. 2,20,000/- WAS PAID TO HIM BY OUR COMPANY TO TA KE UP SOME CONSTRUCTION WORKS) AS HE IS NOT INTERESTED AN D NOT STARTED THE WORK; VII. I HAVE RECEIVED CASH RS. 30,000/- ON 24/12/2010, RS . 50,000/- ON 27/12/2010 AND RS. 70,000/- ON 11/01/20 11 TOTAL OF RS. 1,50,000/-. I HAVE DEPOSITED THIS AMOU NT INTO MY ACCOUNT AND TRANSFERRED THE SAME ON 12/01/2011 TO O UR COMPANY ACCOUNT; 6.1. ASSESSEE ALSO PLACED THE LEDGER COPIES AND CASH BOOK BEFORE THE AO. THE REASONS FOR NON-ACCEPTANCE ARE KN OWN BUT AS SEEN FROM THE EXPLANATION GIVEN, THE CASH DEPOSITS O N 19- 04-2010 OF RS. 5,00,000/- WAS ON BEHALF OF THE COMPA NY. LIKE- WISE, THE DEPOSIT OF RS. 2,50,000/- ON 15-09-2010 WAS FROM OWN SOURCES WITHDRAWAL FROM THE OTHER ACCOUNT. RS. 2,20,000/- OUT OF RS. 3,60,000/- DEPOSITED ON 10-01-1 1 WAS RECEIVED FROM MR. ZAMEERUDDIN SHAIK, WHO HAS CONFIR MED AND THAT WAS ON BEHALF OF COMPANY. RS. 1,40,000/- WAS DR AWAL FROM OTHER ACCOUNT. BALANCE OF RECEIPTS OF CASH ARE NO T I.T.A. NO. 1621/HYD/2016 :- 5 -: SUPPORTED BY ANY EVIDENCE. THEREFORE, AO IS DIRECTE D TO ACCEPT THE ACCOUNT RECEIVED ON BEHALF OF COMPANY (RS. 5,00,0 00 + 2,20,000) AND THE DEPOSIT OF RS. 2,50,000/- ON 15-09 -2010 AND RS. 1,40,000/- ON 10-01-2011 AND RE-WORKOUT THE PEAK OF THE CREDITS. GROUNDS ARE PARTLY ALLOWED. 7. IN THE RESULT, APPEAL OF ASSESSEE IS PARTLY ALLOWED . ORDER PRONOUNCED IN THE OPEN COURT ON 31 ST JANUARY, 2018 SD/- (B. RAMAKOTAIAH) ACCOUNTANT MEMBER HYDERABAD, DATED 31 ST JANUARY, 2018 TNMM I.T.A. NO. 1621/HYD/2016 :- 6 -: COPY TO : 1. MRS. SEEMA DEVRAM THORAT, 6-3-166/1&2, 209 TO 21 1, CHALLA ESTATE, ERRAGADDA, HYDERABAD. 2. THE DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE-3( 1), HYDERABAD. 3. CIT (APPEALS)-3, HYDERABAD. 4. PR.CIT-3, HYDERABAD. 5. D.R. ITAT, HYDERABAD. 6. GUARD FILE.