ITO, Ward -10(4), Hyderabad V. Sri Raj Kumar Pulla, Secunderabad

ITA 1749/HYD/2012

• Counselvise Citation: [2013] 120 COUNSELVISE.COM (IT) 2906 (ITAT-HYDERABAD)
• Duration Of Justice: 5 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-05-2013
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2009-2010
• Appeal Filed On: 06-12-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: PHANI RAJU
• Assessee Lawyers: K BALAJEE NAGRAJ
• Section: 69

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD B BENCH, HYDERABAD BEFORE SHRI B. RAMAKOTAIAH, ACCOUNTANT MEMBER AND SHRI SAKTIJIT DEY, JUDICIAL MEMBER ITA NO.1749/HYD/2012 ASSESSMENT YEAR 2009-10 ITO, WARD-10(4), HYDERABAD VS SRI RAJ KUMAR PULLA, SECUNDERABAD. PAN:AKBPP2993C {APPELLANT) (RESPONDENT) APPELLANT BY : SRI PHANI RAJU RESPONDENT BY SRI K. BALAJEE NAGRAJ DATE OF HEARING : 22-5-2013 DATE OF PRONOUNCEMENT : 31- 5-2013 ORDER PER SAKTIJIT DEY, JUDICIAL MEMBER. THIS APPEAL BY THE DEPARTMENT IS DIRECTED AGAINST T HE ORDER DATED 26-9-2012 OF CIT (A)-VI, HYDERABAD PASSED IN APPEAL NO.0642/2011-12 PERTAINING TO THE ASSESSMENT YEAR 2 009-10. 2. THE DEPARTMENT HAS RAISED THE FOLLOWING EFFECTIV E GROUND BEFORE US:- THE LD CIT (A) OUGHT NOT TO HAVE ALLOWED RELIEF TO THE ASSESSEE THOUGH THE ASSESSEE HAS NOT SUBSTANTIATED THE SOURC ES FOR THE CREDITS/DEPOSITS MADE INTO THE BANK ACCOUNT WITH CO RROBORATIVE DOCUMENTARY EVIDENCE. 3. BRIEFLY THE FACTS ARE, THE ASSESSEE AN INDIVIDU AL FILED HIS RETURN OF INCOME ON 25-11-2009 FOR THE ASSESSMENT YEAR UND ER DISPUTE DECLARING A TOTAL INCOME OF RS.2,61,250/- AND AGRIC ULTURAL INCOME OF RS.72,630/-. ASSESSEES CASE WAS SELECTED FOR SCR UTINY ASSESSMENT. IN COURSE OF SCRUTINY ASSESSMENT PROCEEDINGS, THE A SSESSING OFFICER ITA NO.1749 OF 2012 RAJ KUMAR PULLA, SEC BAD. ================== 2 ON EXAMINING THE ASSESSEES BANK ACCOUNT WITH ICICI BANK LTD., SECUNDERABAD BRANCH NOTICED CASH DEPOSITS AS WELL A S OTHER DEPOSITS MADE INTO THE BANK ACCOUNT. WHEN THE ASSESSING OFF ICER ASKED THE ASSESSEE TO FURNISH THE TRANSACTION-WISE DETAILS OF THE DEPOSITS, THE ASSESSEE SUBMITTED THAT OUT OF THE TOTAL CASH DEPOS IT OF RS.21,34,500/- IN HIS BANK ACCOUNT, HE HAD TAKEN L OAN OF RS.10 LAKHS FROM SRI P. NAGESWARA RAO FOR HIS PERSONAL PURPOSE TO HELP HIS AUNT FOR HER SURGERY. DUE TO UNAVOIDABLE CIRCUMSTANCES , THE SURGERY WAS POSTPONED AND THE SAME WAS DEPOSITED IN THE BANK IN THE FORM OF CASH. THE ASSESSEE AGAIN IN THE MONTH OF MAY, 2008 WITHDREW AN AMOUNT OF RS.4,91,500/- FOR HIS PERSONAL PURPOSE AN D AGAIN RE- DEPOSITED IN THE BANK IN THE FORM OF CASH IN AUGUST , 2008. THE ASSESSEE FURTHER EXPLAINED THAT HE WAS OWNING SOME LAND AT GANDAMGUDA AND WILLING TO START SOME CONSTRUCTION A CTIVITY AND TOOK A LOAN OF RS.5 LAKHS, FROM MR. RAJEEV AURANGABADKAR I N DECEMBER, 2008. HE WITHDREW RS.4 LAKHS FROM HIS ACCOUNT FOR THIS PURPOSE BUT AS THE CONSTRUCTION ACTIVITY COULD NOT COMMENCE HE RE-DEPOSITED THE SAME IN MARCH, 2008. THE ASSESSING OFFICER ACCEPT ED THE ASSESSEES EXPLANATION TO THE EXTENT OF DEPOSIT OF RS.9.9 LAKH S. HOWEVER, SO FAR AS BALANCE OF RS.11,44,500/- IS CONCERNED, THE ASSE SSING OFFICER REJECTED THE CONTENTION OF THE ASSESSEE AND TREATIN G IT AS UNEXPLAINED INCOME, ADDED THE SAME U/S 69 OF THE ACT. BEING AG GRIEVED OF THE ADDITION MADE BY THE ASSESSING OFFICER, THE ASSESSE E PREFERRED AN APPEAL BEFORE THE CIT (A). 4. THE CIT (A) AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE AND EXAMINING THE MATERIALS ON RECORD DELETED THE A DDITION BY OBSERVING AS UNDER:- 4.1. THESE DEPOSITS CAN BE CATEGORISED AND EXAMINE D IN THREE GROUPS ON THE BASIS OF THE EXPLANATION OF THE ASSES SEE. THE FIRST GROUP OF DEPOSITS ARE AS FOLLOWS: DATE AMOUNT (RS. ) 30-4-2008 20,000 25-8-2008 3,00,000 ITA NO.1749 OF 2012 RAJ KUMAR PULLA, SEC BAD. ================== 3 26-8-2008 50,000 08-09-2008 1,50,000 24-09-2008 12,500 11-12-2008 1,00,000 23-12-2008 12,000 29-01-2009 1,00,000 18-03-2009 4,00,000 THE ASSESSEE HAS SUBMITTED THAT THESE AMOUNTS HAD B EEN DEPOSITED OUT OF THE CASH WITHDRAWAL OF RS.4,90,000 ON 27-5- 2008 WHICH HAD BEEN WITHDRAWN FOR HTE MEDICAL TREAT MENT OF THE ASSESSES AUNT). THE ASSESSING OFFICER HAS NOT ACCEPTED THIS EXPLANATION STATING THAT THE SUM OF RS.4,90,000 HAD BEEN USED FOR REPAYMENT OF LOAN TO SRI P. NAGESWARA RAO. IT IS SEEN FROM THE ENTRIES IN THE BANK ACCOUNT AND THE ASSESSEE S EXPLANATION THAT THE REPAYMENT HAS TAKEN PLACE SUBSEQUENTLY, I. E., ON 27-8- 2008 AND ON 11-9-2008. BEFORE THIS, THE ASSESSEE H AD MADE A SELF WITHDRAWAL; OF RS.4,91,500 ON 31-5-2008. HOWE VER, AS PER THE ASSESSEE, THIS AMOUNT WAS EVENTUALLY NOT UTILIS ED AND WAS RE-DEPOSITED ON THE DATES MENTIONED ABOVE. THE ASS ESSING OFFICER HAS IGNORED THIS WITHDRAWAL OF RS.4,91,500 IN HIS ORDER WITHOUT GIVING ANY JUSTIFICATION. I FIND THAT THE ASSESSEES EXPLANATION IS REASONABLE AND DESERVES ACCEPTANCE. 4.2. THE SECOND GROUP OF DEPOSITS CONSISTS OF THE FOLLOWING:- DATE AMOUNT 29-1-2009 RS.1,00,000 18-3-2009 RS.4,00,000 THE ASSESSEE SUBMITTED THAT HE HAD BORROWED A SUM O F RS.6 LAKHS FROM SRI RAJEEV AURANGABADKAR FOR THE PURPOSE OF DEVELOPMENT OF LAND AT GANDHAMGUDA VILLAGE. THE BO RROWALS ARE NOT DISPUTED BY THE ASSESSING OFFICER. THE ASS ESSEE FURTHER SUBMITTED THAT HE HAD PAID ADVANCES TO SRI M.V. BHA DRA RAO (CONTRACTOR FOR ELECTRICAL WORKS) AND SRI G. SHANKE R (CONTRACATOR FOR CIVIL WORKS). SINCE THE PROJECT DID NOT MATER IALISE, THE ASSESSEE RECOVERED THE ADVANCES FROM THE TWO PERSON S AND THE DEPOSITS WERE MADE OUT OF THESE AMOUNTS. THE FACT THAT PAYMENTS WERE MADE TO THESE TWO PERSONS IS BORNE OU T FO THE BANK DETAILS EXTRACTED IN THE ASSESSMENT ORDER. TH E SUBSEQUENT DEPOSITS ALSO TALLY EXACTLY WITH THE SUB SEQUENT DISPUTED DEPOSITS. THE ASSESSEE S EXPLANATION, TH EREFORE, IS LOGICAL AND REASONABLE. THE ASSESSING OFFICER HAS NOT CONSIDERED THIS EXPLANATION OF THE ASSESSEE AND PRE SUMED THAT THESE DEPOSITS HAD BEEN MADE OUT OF HIS INCOME. 4.3. THE THIRD SET OF DEPOSITS ARE AS FOLLOWS: - ITA NO.1749 OF 2012 RAJ KUMAR PULLA, SEC BAD. ================== 4 DATE AMOUNT (RS.) 30-4-2008 20,000 24-9-2008 12,500 11-12-2008 1,00,000 23-12-2008 12,000 THE ASSESSEE SUBMITTED THAT THE DEPOSITS HAD BEEN M ADE OUT OF HIS INCOME FOR THE CURRENT YEAR AND THE SAVINGS FRO M THE EARLIER YEARS. THE ASSESSING OFFICER DID NOT ACCEPT THIS E XPLANATION SINCE THE ASSESSEE HAD NOT FURNISHED ANY INVOICES/V OUCHERS FOR THE CONSULTATION FEES, RENTAL INCOME AND AGRICULTUR AL INCOME SO AS TO ESTABLISH THE NEXUS BETWEEN THE DEPOSITS AND THE INCOME. THE FACT REMAINS THAT THE ASSESSEE HAD RETURNED AN INCOME OF RS.2,61,250/- AND AGRICULTURAL INCOME OF RS.72,630/ - WHICH HAS BEEN ACCEPTED BY THE ASSESSING OFFICER IN HIS ORDER . THESE AMOUNTS, WHICH REFLECT THE NET INCOME OF THE ASSESS EE, WOULD THEMSELVES BE SUFFICIENT TO EXPLAIN THE DEPOSITS OF RS.1,44,500/-. IT WOULD ALSO BE SAFE AND LOGICAL T O PRESUME THAT THE DEPOSITS WERE MADE OUT OF THE GROSS RECEIP TS OF THE ASSESSEE WHICH NATURALLY WOULD BE MORE THAN THE RET URNED (AND NET) INCOME. THE EXPLANATION OF THE ASSESSEE IS, TH EREFORE, ACCEPTED AS REASONABLE. 5. WE HAVE HEARD SUBMISSIONS OF THE PARTIES AND PER USED THE MATERIAL ON RECORD. OUT OF THE TOTAL CASH DEPOSIT OF RS.21,34,500/- IN THE BANK ACCOUNT, THE ASSESSING OFFICER HAD ACCEPT ED ASSESSEES EXPLANATION FOR THE CASH DEPOSIT OF RS.9.9 LAKHS. SO FAR AS THE BALANCE AMOUNT OF RS.11,44,500/- TREATED BY THE ASS ESSING OFFICER AS UNEXPLAINED DEPOSIT AS WOULD BE EVIDENT FROM THE OR DER OF THE CIT (A) QUOTED HEREINBEFORE, THE ASSESSEE HAS SUFFICIENTLY DISCHARGED THE ONUS OF PROVING THE SOURCES OF THE SAID DEPOSITS IN TO T HE BANK ACCOUNT. THE PATTERN OF DEPOSITS AND WITHDRAWALS MADE IN THE BANK ACCOUNT WHICH ARE REPRODUCED BY THE ASSESSING OFFICER IN PA GE-2 OF ASSESSMENT ORDER DOES ESTABLISH THE FACT THAT THE DEPOSITS MADE OF A TOTAL AMOUNT OF RS.5 LAKH ON 25-8-2008, 26-8-2008 A ND ON 8-9-2008 ARE OUT OF THE WITHDRAWALS OF RS.4,91,000/- MADE ON 27-5-2008. SIMILARLY, THE ASSESSEES EXPLANATION WITH REGARD T O THE DEPOSITS OF RS.1 LAKH AND RS.4 LAKH RESPECTIVELY ON 29-1-2009 A ND ON 18-3-2009 ARE ACCEPTABLE IN VIEW OF THE FACT THE ASSESSING O FFICER HAS NOT DISPUTED THE FACT OF BORROWALS OF RS.5 LAKHS MADE F ROM MR. RAJEEV ITA NO.1749 OF 2012 RAJ KUMAR PULLA, SEC BAD. ================== 5 AURANGABADKAR ON 12-12-2008. ASSESSEES EXPLANATI ON WITH REGARD TO TOTAL DEPOSITS OF RS.1,44,500/- ON DIFFERENT DAT ES HAVING BEEN MADE OUT OF HIS INCOME AND SAVINGS, AS MENTIONED IN PAR A 4.3 OF THE CIT (A)S ORDER, ALSO CANNOT BE REJECTED CONSIDERING TH E FACT THAT THE ASSESSEE HAD SHOWN INCOME OF RS.2,61,250/- AND AGRI CULTURAL INCOME OF RS.72,630/- WHICH HAS NOT BEEN DISPUTED BY THE A SSESSING OFFICER. CONSIDERING THE TOTALITY OF FACTS AND THE CIRCUMSTA NCES OF THE CASE, WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF THE CIT ( A) IN DELETING THE ADDITIONS MADE BY THE ASSESSING OFFICER AS THE ASSE SSEE HAS SATISFACTORILY EXPLAINED THE SOURCE OF SUCH DEPOSIT S. IN AFORESAID VIEW OF THE MATTER, WE CONFIRM THE ORDER OF THE CIT (A) AND DISMISS THE GROUNDS RAISED BY THE DEPARTMENT. 6. IN THE RESULT, THE APPEAL FILED BY THE DEPARTMEN T STANDS DISMISSED. ORDER WAS PRONOUNCED IN THE OPEN COURT ON 31 -05-20 13. (B. RAMAKOTAIAH ) (SAKTIJIT DEY) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED THE 31 ST MAY, 2013. COPY FORWARDED TO: 1. INCOME-TAX OFFICER, WARD-10(4), HYDERABAD. 2. SRI RAJ KUMAR PULLA, 10-1-12, NEHRU NAGAR, SECUNDER ABAD. 3. CIT (A)-VI, HYDERABAD. 4. CIT CONCERNED, HYDERABAD. 5. THE DR, ITAT, HYDERABAD JMR* ITA NO.1749 OF 2012 RAJ KUMAR PULLA, SEC BAD. ================== 6