Shri Ashokbhai Jadavbhai Dhamelia(HUF), Bhavnagar V. The Income tax Officer,Ward-2(3), Bhavnagar

ITA 1696/AHD/2009

• Counselvise Citation: [2009] 114 COUNSELVISE.COM (IT) 8919 (ITAT-AHMEDABAD)
• Duration Of Justice: 4 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-09-2009
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: B
• Next Hearing Date: 11-09-2009
• Assessment Year: 2004-2005
• Appeal Filed On: 22-05-2009
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: NEETA SHAH SENIOR
• Assessee Lawyers: B R POPAT
• Keywords: Source of fund

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCH 'B' (BEFORE S/SHRI P K BANSAL AND MAHAVIR SINGH) ITA NO.1696/AHD/2009 (ASSESSMENT YEAR:- 2004-05) ASHOKBHAI JADAVBHAI DHAMELIA (HUF), AT: MITHAPAR, DISTRICT BHAVNAGAR PAN : AACHA 5059 D V/S THE INCOME-TAX OFFICER, WARD-2(3), BHAVNAGAR [APPELLANT] [RESPONDENT] APPELLANT BY :- SHRI B R POPAT RESPONDENT BY:- SMT. NEETA SHAH, SENIOR DR O R D E R PER P K BANSAL (ACCOUNTANT MEMBER): THIS APPEAL HAS BEEN FILED BY THE ASSESSEE AGAINST THE ORDER OF THE CIT( A) DATED 26/02/2009 BY TAKING THE FOLLOWING TWO EFFECTIVE GR OUNDS OF APPEAL:- THE LEARNED CIT(A)-XX, AHMEDABAD HAS ERRED IN: 1 CONFIRMING THE ADDITION OF RS.20,000/- ORIGINALLY M ADE BY THE AO BY DISBELIEVING THE FACT OF THE INVESTMENT IN KVPS HAVING BEEN MADE IN THE PERIOD PRIOR TO COMMENCEMENT OF THE FIN ANCIAL YEAR. 2 CONFIRMING THE ADDITION OF RS.2,00,000/- ORIGINALLY MADE BY THE AO BY TREATING THE CASH DEPOSITED IN THE BANK ACCOU NT AS THE UNDISCLOSED INCOME. 2 THE BRIEF FACTS RELATING TO GROUND NO.1 ARE THAT THE AO NOTICED FROM THE DETAILS FILED THAT THE ASSESSEE IN COMPUTATION OF TOTAL INCOME HAS SHOWN INTEREST INCO ME FROM BANK OF RS.1,441/- AND INTEREST INCOME ON KVP OF RS .20,000/- 2 AND THEREBY TOTAL INTEREST INCOME IS SHOWN AT RS.21 ,441/-. THE ASSESSEE CLAIMED DEDUCTION U/S 80L OF RS.1441/- AND THEREBY SHOWN NET TAXABLE INCOME OF RS.20,000/-. HOWEVER, O N VERIFICATION OF THE BALANCE SHEET AS ON 31-03-2003 BY THE AO, THERE IS NO BALANCE AT ASSET SIDE IN RESPECT OF KVP . AS SUCH, THE CREDIT SHOWN FOR KVP OF RS.20,000/- (PRINCIPAL AMOU NT)WAS TREATED BY THE AO AS ASSESSEES INCOME FROM UNDISCL OSED SOURCES AND THE SAME WAS ADDED TO THE TOTAL INCOME OF THE A SSESSEE. THUS, THE AO MADE AN ADDITION OF RS.40,000/- TOWARDS UNDI SCLOSED INVESTMENT IN KVP AND INTEREST THEREON. WHEN THE M ATTER WENT BEFORE THE CIT(A), THE CIT(A) CONFIRMED THE ADDITIO N. 3 WE HAVE CAREFULLY CONSIDERED THE RIVAL SUBMISSIO NS AND PERUSED THE MATERIAL ON RECORD. WE NOTED THAT I N THIS CASE THE AO MADE THE ADDITION NOT ONLY IN RESPECT OF UNACCOU NTED INVESTMENT IN KVPS AND ALSO RS.2000/- DEPOSITED IN THE BANK ACCOUNT AS UNDISCLOSED INCOME BUT ALSO SALE PROCEED S OF AGRICULTURE TREATED AS INCOME FROM UNDISCLOSED SOUR CES AMOUNTING TO RS.5,33,117/-. THE ADDITION OF RS.5,33 ,117/- WHICH WAS SHOWN BY THE ASSESSEE IN THE CASH BOOK AS RECEI PT FROM SALE PROCEEDS OF AGRICULTURAL PRODUCTS AMOUNTING TO RS.5 ,33,117/- [RS.2,90,301/- ON 25-02-04 AND RS.2,42,817/- ON 25- 02-04] WAS DELETED BY THE CIT(A) AND THE CIT(A) HAS DIRECTED T HE AO TO ACCEPT IT AS INCOME FROM AGRICULTURE. THE REVENUE H AS NOT COME IN APPEAL AGAINST DELETION OF THE ADDITION OF RS.5, 33,117/- AS AGRICULTURAL INCOME. WHEN THE ASSESSEE WAS HAVING S UCH HUGE AGRICULTURAL INCOME, WE DO NOT AGREE WITH THE REVEN UE THAT THE SUM OF RS.2,00,000/- DEPOSITED BY THE ASSESSEE IN C ASH OUT OF 3 TIJORI ACCOUNT IS DEPOSITED OUT OF THE UNDISCLOSED INCOME. IN OUR OPINION, THE SOURCE OF FUNDS OF RS.2,00,000/- IS DU LY PROVED IN VIEW OF THE ACCEPTANCE OF THE AGRICULTURAL INCOME I N THE HANDS OF THE ASSESSEE. THE ASSESSEE MUST BE HAVING SIMILAR A GRICULTURAL INCOME IN THE EARLIER YEAR ALSO. THE EXTENT OF AGRI CULTURAL INCOME MAY NOT BE THE SAME BUT IN ANY CASE IT WILL EXCEED RS.2,00,000/- WHEN THE AGRICULTURAL INCOME IS ACCEPTED DURING THE YEAR AT RS.5,33,117/-. WE ACCORDINGLY DELETE THE ADDITION O F RS.2,00,000/-. THUS, GROUND NO.2 AS TAKEN BY THE AS SESSEE STANDS ALLOWED. 4 COMING TO GROUND NO.1, WE AGREE WITH THE REVENUE THAT IN VIEW OF THE FACT THAT KVPS NOT APPEARING IN THE ASSET SIDE OF THE BALANCE SHEET OF THE ASSESSEE IN THE EARLIER YEAR, IT CANNOT BE CONCLUDED THAT THE ASSESSEE HAD MADE THE INVESTM ENT IN KVPS IN THE EARLIER YEAR. THE ONUS IS ON THE ASSESSEE TO PROVE THAT THE INVESTMENT HAS BEEN MADE IN KVPS AT RS.20,000/- IN THE EARLIER YEAR. NO COGENT MATERIAL OR EVIDENCE HAS BEEN BROUG HT ON RECORD BY THE ASSESSEE IN THIS REGARD. WE ACCORDINGLY CONF IRM THE ADDITION OF RS.20,000/-. THUS, GROUND NO.1 STANDS D ISMISSED. 5 IN THE RESULT, THE APPEAL IS PARTLY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT TODAY ON 25-09-2 009 SD/- SD/- (MAHAVIR SINGH) JUDICIAL MEMBER (P K BANSAL) ACCOUNTANT MEMBER DATE : 25-09-2009 4 COPY OF THE ORDER FORWARDED TO : 1. ASHOKBHAI JADAVBHAI DHAMELIA (HUF), AT: MITHAPAR , DISTRICT BHAVNAGAR 2. THE ITO, WARD-2(3), BHAVNAGAR 3. CIT CONCERNED 4. CIT(A)-XX, AHMEDABAD 5. THE DR, ITAT, AHMEDABAD 6. GUARD FILE BY ORDER DEPUTY REGISTRAR ASSISTANT REGISTRAR ITAT, AHMEDABA