Sri.C.Balasubramaniam, Ernakulam V. DCIT, Ernakulam

ITA 163/COCH/2012

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 58235 (ITAT-COCHIN)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-01-2012
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 20-12-2012
• Assessment Year: 2005-2006
• Appeal Filed On: 21-06-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S VIJAYAPRABHA
• Assessee Lawyers: C B M WARRIER
• Keywords: Onus to prove

Judgement Text

1 ITA NO.163 & 164/COCH/2012 IN THE INCOME TAX APPELLATE TRIBUNAL COCHIN BENCH, COCHIN BEFORE SHRI N.R.S. GANESAN (JM) AND SHRI B.R. BASKA RAN(AM) I.T.A NO. 163 & 164/COCH/2012 (ASSESSMENT YEARS 2005-06 & 2008-09) SHRI C BALASUBRAMANIAM VS DY.CIT, CENT.CIR.1 32/2241A, NEAR BSNL ERNAKULAM CIVIL LANE ROAD, PALARIVATTOM PAN : AAFPB9358K (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI CBM WARRIER RESPONDENT BY : SMT. S VIJAYAPRABHA DATE OF HEARING : 20-12-2012 DATE OF PRONOUNCEMENT : 22-01-2013 O R D E R PER N.R.S. GANESAN (JM) BOTH THE APPEALS OF THE TAXPAYER ARE DIRECTED AGAI NST THE COMMON ORDER PASSED BY THE COMMISSIONER OF INCOME-TAX(A) F OR THE ASSESSMENT YEARS 2005-06 & 2008-09. THEREFORE, WE HEARD THEM TOGETHER AND DISPOSE OF THE SAME BY THIS COMMON ORDER. 2 ITA NO.163 & 164/COCH/2012 2. LET US FIRST TAKE APPEAL FOR ASSESSMENT YEAR 200 5-06 IN ITA NO.163/COCH/2012. THE SOLE ISSUE RAISED IN THE APP EAL IS WITH REGARD TO ADDITION OF RS.1,89,346. 3. SHRI CBM WARRIER, THE LD.REPRESENTATIVE FOR THE TAXPAYER SUBMITTED THAT THE TAXPAYER HAS SHOWN RS.3,83,499 AS OPENING CASH BALANCE FOR THE ASSESSMENT YEAR UNDER CONSIDERATION AND CLOSING CAS H AND BANK BALANCE AT RS. 2,19,833. THE ASSESSING OFFICER ESTIMATED THE CLOSING CASH BALANCE AT RS.25,000 AND DISALLOWED THE REMAINING AMOUNT OF R S.1,89,346. ACCORDING TO THE LD.REPRESENTATIVE, THE TAXPAYER HAS RECEIVED RS.2,80,000 FROM HIS MOTHER IN LAW. SIMILAR RECEIPT FROM THE MOTHER IN LAW FOR EARLIER ASSESSMENT YEAR WAS ACCEPTED BY THE ASSESSING OFFIC ER. THERE IS NO REASON FOR DISALLOWING THE CLAIM OF THE TAXPAYER WITH REGA RD TO RECEIPT OF MONEY FROM MOTHER IN LAW. ACCORDING TO THE LD.REPRESENTA TIVE, IF THERE IS ANY DOUBT ABOUT THE RECEIPT OF FUNDS, THE ENTIRE FUNDS RECEIVED FROM MOTHER IN LAW HAS TO BE DISALLOWED. IN THIS CASE, THE ASSESS ING OFFICER ACCEPTED THAT MONEY WAS RECEIVED FROM MOTHER IN LAW; HOWEVER, HE DISALLOWED PART OF THE AMOUNT TO THE EXTENT OF RS.1,89,346. IN THE AB SENCE OF ANY MATERIAL, THE ASSESSING OFFICER IS NOT JUSTIFIED IN DISALLOWIN G PART OF THE CLAIM. 3 ITA NO.163 & 164/COCH/2012 4. ON THE CONTRARY, SMT. S VIJAYAPRABHA, THE LD.DR S UBMITTED THAT THE TAXPAYER CLAIMED THAT HE RECEIVED RS.2,80,000 FROM HIS MOTHER IN LAW. THE TAXPAYER HAS SHOWN THE CASH AND BANK BALANCE AT RS. 2,19,833 AND THE CLOSING CASH BALANCE AT RS.2,14,436. THE ASSESSING OFFICER HAS REASONABLY ESTIMATED THE CASH BALANCE AT RS.25,000. THEREFORE , BY REDUCING RS.25,000 FROM THE CLOSING BALANCE, THE BALANCE OF RS.1,89,34 6 WAS FOUND TO BE FROM UNDISCLOSED SOURCES. ACCORDING TO THE LD.DR, THE R ECEIPT OF MONEY FROM MOTHER IN LAW TO THE EXTENT OF RS.1,89,346 WAS DOUB TED. 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EITH ER SIDE AND ALSO PERUSED THE MATERIAL AVAILABLE ON RECORD. ADMITTED LY, THE TAXPAYER CLAIMED THAT A SUM OF RS.2,80,000 WAS RECEIVED FROM HIS MOT HER IN LAW. THE CLOSING CASH BALANCE WAS SHOWN AT RS.2,14,346. THOUGH THE ASSESSING OFFICER FOUND THAT CASH TO THE EXTENT OF RS.1,89,346 WAS TREATED AS NOT ACTUALLY RECEIVED FROM MOTHER IN LAW, AS RIGHTLY SUBMITTED BY THE LD. REPRESENTATIVE FOR THE TAXPAYER, PART OF THE FUNDS WAS ACCEPTED AS HAVING BEEN RECEIVED FROM MOTHER IN LAW. THEREFORE, THE RECEIPT OF MONEY FRO M MOTHER IN LAW IS NOT IN DISPUTE. ONLY THE QUANTUM WAS DISPUTED. IN THE ABSENCE OF ANY MATERIAL TO DOUBT THE QUANTUM OF MONEY, THIS TRIBUNAL IS OF THE CONSIDERED OPINION 4 ITA NO.163 & 164/COCH/2012 THAT RESTRICTING THE RECEIPT OF MONEY FROM MOTHER I N LAW TO THE EXTENT OF RS.25,000 IS NOT JUSTIFIED. IF AT ALL THERE WAS ANY DOUBT, THE ASSESSING OFFICER WOULD HAVE DISALLOWED THE ENTIRE AMOUNT OF RS.2,80, 000. THE VERY FACT THAT THE ASSESSING OFFICER HAS ACCEPTED THE RECEIPT OF M ONEY PARTLY SHOWS THAT THERE WAS ACTUAL RECEIPT OF MONEY BY THE TAXPAYER F ROM MOTHER IN LAW. IN THE ABSENCE OF ANY MATERIAL TO DISALLOW THE CLAIM O F THE TAXPAYER, THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT THE ASSE SSING OFFICER MAY NOT BE RIGHT IN DISALLOWING THE AMOUNT OF RS.1,89,346. AC CORDINGLY, THE ORDERS OF LOWER AUTHORITIES ARE SET ASIDE AND THE ADDITION OF RS.1,89,346 IS DELETED. 6. NOW COMING TO APPEAL FOR ASSESSMENT YEAR 2008-09 IN ITA NO.164/COCH/2012, THE ONLY ISSUE ARISES FOR CONSIDE RATION IS ADDITION OF RS.2,05,000. 7. SHRI C.B.M WARRIER, THE LD.REPRESENTATIVE FOR TH E TAXPAYER SUBMITTED THAT THE TAXPAYER HAS RECEIVED RS.2,05,000 FROM ONE SHRI RAJAN V MATHEW BY CHEQUE NO.32142 DATED 30-01-2008 DRAWN ON SBT, K OTTAYAM. THE ABOVE AMOUNT WAS CREDITED IN THE ACCOUNT OF THE TAX PAYER MAINTAINED WITH 5 ITA NO.163 & 164/COCH/2012 FEDERAL BANK. ACCORDING TO THE LD.REPRESENTATIVE, WHEN THE TRANSACTION WAS MADE THROUGH BANK, THERE CANNOT BE ANY ADDITION. 8. ON THE CONTRARY, SMT S VIJAYAPRABHA, THE LD.DR SU BMITTED THAT THE TAXPAYER CLAIMED THAT HE RECEIVED A LOAN FROM SHRI RAJAN V MATHEW TO THE EXTENT OF RS.2,05,000. HOWEVER, NO DOCUMENTARY EVI DENCE WAS FILED TO PROVE THE CREDITWORTHINESS OF THE CREDITOR, GENUINE NESS OF THE TRANSACTION AND CAPACITY OF THE CREDITOR TO GIVE THE LOAN. ACC ORDING TO THE LD.DR, IN THE ABSENCE OF ANY MATERIAL, MERE TRANSACTION THROUGH B ANKING CHANNEL MAY NOT JUSTIFY THE CLAIM OF THE TAXPAYER. 9. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EITH ER SIDE AND ALSO PERUSED THE MATERIAL AVAILABLE ON RECORD. THOUGH T HE TAXPAYER CLAIMS THAT THE AMOUNT WAS RECEIVED THROUGH BANKING CHANNEL, NO MATERIAL IS AVAILABLE ON RECORD TO SUGGEST THAT THE CREDITOR HAS THE CAPA CITY TO GIVE THE CREDIT OR TO PROVE THE GENUINENESS OF THE TRANSACTION. IT IS WELL SETTLED PRINCIPLES OF LAW THAT THE BURDEN OF PROOF LIES ON THE SHOULDERS OF THE TAXPAYER TO PROVE THE IDENTITY OF THE CREDITOR, CAPACITY OF THE CREDI TOR TO GIVE THE CREDIT AND GENUINENESS OF THE TRANSACTION. SINCE THE TAXPAYER HAS NOT TAKEN ANY STEPS 6 ITA NO.163 & 164/COCH/2012 TO PROVE THE ABOVE THREE CONDITIONS, THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT THE COMMISSIONER OF INCOME-TAX(A) HAS RIGHTLY CONFIRMED THE ADDITION MADE BY THE ASSESSING OFFICER. THEREFORE, THIS TRIBUNAL DO NOT FIND ANY INFIRMITY IN THE ORDER OF THE LOWER AUTHORITY. ACCORDINGLY THE SAME IS CONFIRMED. 10. IN THE RESULT, THE APPEAL IN ITA NO.163/COCH/20 12 IS ALLOWED AND THE APPEAL IN ITA NO.164/COCH/2012 IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 22 ND JANUARY, 2013. SD/- SD/- (B.R. BASKARAN) (N.R.S. GANESAN) ACCOUNTANT MEMBER JUDICIAL MEMBER COCHIN, DT : 22 ND JANUARY, 2013 PK/- COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE COMMISSIONER OF INCOME-TAX 4. THE COMMISSIONER OF INCOME-TAX(A) 5. THE DR (TRUE COPY) BY ORDER ASSTT. REGISTRAR, INCOME-TAX APPELLATE TRIBUNAL, COCHIN BENCH