ACIT, CHENNAI V. Smt. B.Ramani, Vellore

ITA 1824/CHNY/2012

• Counselvise Citation: [2013] 120 COUNSELVISE.COM (IT) 1132 (ITAT-CHENNAI)
• Duration Of Justice: 5 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-03-2013
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: D
• Next Hearing Date: 18-03-2013
• Assessment Year: 2008-2009
• Appeal Filed On: 05-10-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S DASGUPTA
• Assessee Lawyers: A MAHESH
• Keywords: Unexplained cash credit; Gift; Additional evidence; Valuation report
• Section: 143(3); 153A; 68; 69

Judgement Text

IN THE INCOME-TAX APPELLATE TRIBUNAL D BENCH, CHENNAI. BEFORE DR. O.K. NARAYANAN, VICE-PRESIDENT & SHRI S.S. GODARA, JUDICIAL MEMBER I.T.A. NOS.1823 AND 1824/MDS/2012 ASSESSMENT YEARS : 2003-04 AND 2008-09 THE ASSISTANT COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE IV (1), 46, MAHATMA GANDHI ROAD, NUNGAMBAKKAM, CHENNAI 34. VS. SMT. B. RAMANI, NO.54, THENNAMARAM ST., VELLORE. [PAN:AAEPR7607N] (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI S. DAS GUPTA, JCIT RESPONDENT BY : SHRI A. MAHESH, C.A. DATE OF HEARING : 18 . 03 .201 3 DATE OF PRONOUNCEMENT : 26.03.2013 ORDER PER S.S. GODARA, JUDICIAL MEMBER THESE TWO REVENUES APPEALS FOR ASSESSMENT YEARS 2 003-04 AND 2008-09, ARE DIRECTED AGAINST THE COMMON ORDER OF T HE COMMISSIONER OF INCOME TAX (APPEALS) -I, CHENNAI DATED 23.07.2012 I N ITA NO. 218 - 223/09- 10, IN PROCEEDINGS UNDER SECTION 153A R.W.S. 143(3) FOR THE ASSESSMENT YEAR 2003-04 AND UNDER SECTION 143(3) FOR THE ASSESSMENT YEAR 2008-09, RESPECTIVELY OF THE INCOME TAX ACT 1961 [IN SHORT T HE ACT]. I.T.A. NO. 1823/MDS/2012 [AY: 2003-04] 2. IN THE COURSE OF HEARING, THE REVENUE HAS VEHEM ENTLY REITERATED THE SUBSTANTIVE GROUNDS NO. 1.A, 2.A AND 3.A READING AS FOLLOWS: I.T.A. I.T.A. I.T.A. I.T.A. NO NONO NOS SS S. .. .182 182182 1823 & 1824 3 & 1824 3 & 1824 3 & 1824/M/ /M/ /M/ /M/12 1212 12 2 1.A ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(A) HAS ERRED IN DELETING THE UNEXPLAINED CREDIT S U/S 68 IN THE NAMES OF A. UDAYAKUMAR AMOUNTING TO ` .8,00,000 AND A. BALAMANOGARAN AMOUNTING TO ` .4,00,000. 2.A ON THE FACTS AND IN THE CIRCUMSTANCES OF THE C ASE, THE LEARNED CIT(A) HAS ERRED IN DELETING THE ADDITION U/S 68 RE LATING TO ADVANCE RECEIVED FROM ASSESSEES FATHER AMOUNTING TO ` .2,00,000. 3.A ON THE FACTS AND IN THE CIRCUMSTANCES OF THE C ASE, THE LEARNED CIT(A) HAS ERRED IN DIRECTING THE A.O. TO ASSESS TH E INCOME OF ` .7,42,950 AND ` .2,95,152 UNDER THE HEAD OTHER SOURCES AS AGAINST THE ADDITION MADE BY THE A.O. UNDER SECTION 69 OF THE I.T. ACT, 1961. AND PRAYED FOR ACCEPTANCE OF THE APPEAL. 3. IN REPLY, THE ASSESSEE CHOOSES TO RELY UPON THE ORDER OF THE CIT(A) AND REASONS CONTAINED THEREIN. IT HAS ALSO FILED A COMPILATION OF WRITTEN ARGUMENTS THAT OF SHORT PAPER BOOK AND PRAYS FOR RE JECTION OF THE APPEAL. 4. FACTS COMMON TO ALL GROUNDS ARE THAT THE ASSESS EE IS AN INDIVIDUAL. ON 06.06.2007, THE DEPARTMENT HAD CONDUCTED A SEAR CH LEADING TO SEIZURE IN THE CASE OF HER HUSBAND SHRI V. SHANKAR, WHICH L ED TO UNEARTHING OF GOLD JEWELLERY AND FIXED DEPOSITS. PER ASSESSMENT ORDER, ASSESSEES HUSBAND IS STATED TO HAVE DISCLOSED THAT THE SAME BELONGING TH E ASSESSEE WHICH LED TO ISSUANCE OF A NOTICE TO HER UNDER SECTION 153A R.W. S. 153C OF THE ACT. IN RESPONSE THEREOF, SHE RETURNED INCOME OF ` .11,70,365/- AND ALSO AGRICULTURAL INCOME OF ` .30,000/-. 5. IN SCRUTINY PROCEEDINGS, THE ASSESSEE CLAIMED TO HAVE RECEIVED GIFTS I.T.A. I.T.A. I.T.A. I.T.A. NO NONO NOS SS S. .. .182 182182 1823 & 1824 3 & 1824 3 & 1824 3 & 1824/M/ /M/ /M/ /M/12 1212 12 3 OF ` .12.00 LAKHS [ ` .8.00 LAKHS AND ` .4.00 LAKHS] FROM MR. A. UDAYAKUMAR AND MR.A. BALAMANOGARAN RESPECTIVELY. THE ASSESSING OFF ICER DECLINED TO ACCEPT THE SAID PLEA OF THE ASSESSEE IN THE ASSESSMENT ORD ER DATED 22.12.2009 FOR WANT OF PROPER CONFIRMATIONS FROM THE DONORS HOLDIN G THAT THEIR INTENTION TO BE THAT OF COVERING UP THE CONCEALMENT OF THE RECEI PTS IN QUESTION. IN THESE FACTS, THE AFORESAID AMOUNTS STOOD ADDED TO ASSESSE ES INCOME. SIMILARLY, THE ASSESSEE HAD ALSO CLAIMED TO HAVE RECEIVED AN ADVANCE OF ` .2.00 LAKHS FROM HER FATHER. THE ASSESSING OFFICER MADE ADDITION QUA THIS AMOUNT AS WELL BY HOLDING THAT HER FATHER HAD ONLY BEEN FILING RETURN TAKING BENEFIT OF NON-TAXABLE MAXIMUM INCOME. IN THE SAME MANNER, THE ASSESSEE HAD DECLARED RECEI PTS FROM OTHER SOURCES ATTRIBUTABLE DIFFERENCE IN COST OF LAND OF ` .7,42,950/- AND JEWELLERY BILLS OF ` .2,95,152/-. SHE PLEADED BEFORE THE ASSESSING OFFIC ER THAT THOUGH THERE WAS NO ACTUAL DIFFERENCE IN PRICES, STILL THE AMOUNT HAD BEEN OFFERED UNDER THE HEAD OTHER SOURCES TO PURCHASE PEACE WI TH THE DEPARTMENT. SIMILAR EXPLANATION WAS ALSO MADE QUA JEWELLERY BIL LS. IN THE ASSESSMENT ORDER, THE ASSESSING OFFICER REJECTED THE AFORESAID CONTENTIONS AND MADE ADDITIONS OF THE AFORESAID AMOUNTS UNDER SECTION 69 B OF THE ACT. 6. AGGRIEVED, THE ASSESSEE PREFERRED APPEAL. IN TH E ORDER UNDER CHALLENGE, THE CIT(A) HAS HELD QUA GIFTS AND ADVANC ES (SUPRA) THAT THE ASSESSEE HAD SUCCESSFULLY PROVED BY LEADING COGENT MATERIAL ON RECORD I.T.A. I.T.A. I.T.A. I.T.A. NO NONO NOS SS S. .. .182 182182 1823 & 1824 3 & 1824 3 & 1824 3 & 1824/M/ /M/ /M/ /M/12 1212 12 4 ABOUT THE IDENTITY, GENUINENESS AND CREDITWORTHINES S OF THE DONORS AND CREDITORS (SUPRA). PER CIT(A), SHE HAD ALSO FILED C ONFIRMATIONS TO BUTTRESS HER SUBMISSIONS. IN THE LIGHT THEREOF, BOTH THE AFORESA ID ADDITIONS OF ` .12.00 LAKHS AND ` .2.00 LAKHS STAND DELETED. QUA THE OTHER ADDITION UNDER SECTION 69B (SUPRA), THE CIT(A) HOLDS THAT THE AMOUNT IN QUESTION IS LIABLE TO BE ASSESSE D UNDER THE HEAD OTHER SOURCES. THEREFORE, THE REVENUE IS IN APPEAL. 7. WE HAVE HEARD BOTH PARTIES AND PERUSED THE FIND INGS OF THE ASSESSING OFFICER, CIT(A), WRITTEN ARGUMENTS AND THE PAPER BO OK PLACED ON RECORD. SO FAR AS ADDITIONS OF ` .12.00 LAKHS AND ` .2.00 LAKHS MADE BY THE ASSESSING OFFICER QUA THE AMOUNTS RECEIVED AS GIFTS BY THE AS SESSEE FROM HER MATERNAL COUSIN AND ADVANCE FROM HER FATHER ARE CONCERNED, T HERE IS HARDLY ANY ISSUE BETWEEN THE PARTIES THAT THEY HAD FILED CONFIRMATIO NS BEFORE THE ASSESSING OFFICER. IT IS NOT A CASE OF THE REVENUE THAT THE A SSESSEE HAD FILED ANY ADDITIONAL EVIDENCE BEFORE THE CIT(A). ONCE THAT IS SO AND IN VIEW OF THE RELATIONSHIPS BETWEEN THE ASSESSEE AND THE AFORESAI D PARTIES (SUPRA), WE SEE NO REASON TO INTERFERE WITH THE FINDINGS OF THE CIT(A) ABOUT IDENTITY, GENUINENESS AND CREDITWORTHINESS OF THE DONORS AND CREDITORS AS RAISED BY THE REVENUE. I.T.A. I.T.A. I.T.A. I.T.A. NO NONO NOS SS S. .. .182 182182 1823 & 1824 3 & 1824 3 & 1824 3 & 1824/M/ /M/ /M/ /M/12 1212 12 5 8. COMING TO OTHER ISSUE REGARDING HEAD OF INCOME QUA ADDITION OF ` .7,42,950/- AND ` .2,15,152/-, THE ASSESSEE IN HER WRITTEN ARGUMENTS HAS FILED A PAPER BOOK (SUPRA) ON RECORD. IT IS EVIDENT THAT IN CASE OF ASSESSEES HUSBAND SHRI V. SHANKAR AS WELL, THE SAME ISSUE HAD ARISEN BETWEEN THE PARTIES. THE COORDINATE BENCH IN I.T.A. NOS. 703 TO 709/MDS/2012 FOR THE ASSESSMENT YEARS 2002-03 TO 2008-09 AS WELL AS C.OS FILED THEREIN HAS DECIDED THE VERY ISSUE AGAINST THE REVENUE. ON BEIN G GRANTED AN OPPORTUNITY, NO DISTINGUISHING FEATURES HAVE BEEN P OINTED OUT BY THE REVENUE QUA FACTS INVOLVED IN BOTH CASES. THAT BEIN G THE FACTUAL POSITION, WE DO NOT SEE ANY REASON TO ADOPT A DIFFERENT VIEW IN THE INSTANT CASE. ACCORDINGLY, THE ORDER OF THE CIT(A) IS UPHELD. I.T.A. NO. 1824/MDS/2012 [AY: 2008-09] 9. FACTS QUA THIS CASE ARE THAT THE SEARCH IN QUES TION HAD LED THE SEIZURE OF GOLD AND DIAMOND JEWELLERY IN THE CASE OF THE AS SESSEE FOR THE REASON THAT HER HUSBAND IS STATED TO HAVE REVEALED BEFORE THE DEPARTMENT THAT THE SAME BELONGED TO THE ASSESSEE. ON THIS, THE ASSESSI NG OFFICER OBTAINED A VALUATION REPORT FROM THE APPROVED VALUER DECLARING THE WORTH OF GOLD AND DIAMOND JEWELLERY AS ` .28,18,135/-. 10. ON BEING PUT UP TO NOTICE, THE ASSESSEE PLEADE D AS UNDER BEFORE THE ASSESSING OFFICER: SHE RECEIVED 75 SOVEREIGNS OF JEWELLERY AND 13.5 C ARATS OF DIAMOND AT THE TIME OF MARRIAGE; I.T.A. I.T.A. I.T.A. I.T.A. NO NONO NOS SS S. .. .182 182182 1823 & 1824 3 & 1824 3 & 1824 3 & 1824/M/ /M/ /M/ /M/12 1212 12 6 HER ONLY DAUGHTER ALSO RECEIVED JEWELLERY ON VARIOU S OCCASIONS FROM HER GRAND PARENTS; HER MOTHERS JEWELLERY KEPT IN THE LOCKER NO. 20515 7 WAS ALSO SEIZED; NO JEWELLERY WAS ACQUIRED BY HER AT ANY POINT OF TI ME; SHE RELIED UPON LETTER 30.07.2007 FILED BY HER MOTH ER BEFORE THE DDIT; SHE PLEADED THEREFORE THAT THE ENTIRE JEWELLERY STA NDS EXPLAINED. AS WE NOTICE FROM THE ASSESSMENT ORDER DATED 22.12. 2009, THE ASSESSING OFFICER DID NOT AGREE TO THE AFORESAID CO NTENTIONS OF THE ASSESSEE. THEREFORE, BY PLACING RELIANCE ON WEALTH TAX RETURNS OF HERSELF AND HER HUSBAND FOR ASSESSMENT YEAR 1992-93, HE TREATED THE JEWELLERY WEIGHING 795 GRAMS AS EXPLAINED. QUA BALANCE JEWELLERY OF 23 28.5 GRAMS, HE TREATED IT AS UNEXPLAINED LEADING TO ADDITION UNDER SECTION 69A OF THE ACT OF ` .22,38,386/- IN ASSESSEES TOTAL INCOME. 11. THE ASSESSEE CARRIED THE MATTER IN APPEAL. AS IT IS FOUND FROM THE ORDER UNDER CHALLENGE, THE CIT(A) AFTER EXAMINING A LL HER CONTENTIONS AS WELL AS MATERIAL ON RECORD HOLDS THAT SHE IS THE ONLY DA UGHTER OF RICH LAND LORD BEING MARRIED INTO A WEALTHY FAMILY OF A STATE MINI STER. THEREFORE, IN THE BACKDROP OF THESE FACTS AND AFTER TAKING INTO CONSI DERATION THE TOTALITY OF THE CIRCUMSTANCES, HE OBSERVES THAT SHE IS ENTITLED FOR SRIDHAN CLAIM OF 63.100 SOVEREIGNS OF GOLD AND 13.5 CARATS DIAMOND JEWELLER Y AND THE OTHER 175 GRAMS HAS BEEN HELD TO HAVE BEEN RECEIVED THROUGH A WILL BY HER HUSBANDS GRANDMOTHER-IN-LAW. 12. SIMILARLY, THE CIT(A) EXAMINED IN LOWER APPELL ATE PROCEEDINGS THE I.T.A. I.T.A. I.T.A. I.T.A. NO NONO NOS SS S. .. .182 182182 1823 & 1824 3 & 1824 3 & 1824 3 & 1824/M/ /M/ /M/ /M/12 1212 12 7 CLAIM RAISED BY ASSESSEES MINOR DAUGHTER FOR GOLD MEASURING 428.800 GRAMS TO BE HERS WHICH WAS GIVEN BY ASSESSEES FATH ER TO HER MATERNAL GRANDDAUGHTER (SUPRA). PER CIT(A), THE SAID CONTENT ION IS ALSO REASONABLE. IT IS ALSO EVIDENT THAT HE HAS ONLY TREATED THE JEWELL ERY MEASURING 300 GRAMS AS DULY EXPLAINED AND THE BALANCE 128.800 GRAMS HAS BEEN CONFIRMED IN THE HANDS OF THE ASSESSEE UNDER SECTION 69A OF THE ACT . 13. THEREAFTER, CIT(A) PROCEEDS TO EXAMINE ASSESSE ES MOTHERS CLAIM THAT THE JEWELLERY SEIZED OF 1399 GRAMS AND 1 CARAT DIAMOND BELONGS TO HER. QUA THIS CLAIM AS WELL, THE CIT(A) HAS CONSIDERED A T LENGTH THE PLEA RAISED BY ASSESSEES MOTHER THAT THE JEWELLERY WAS GIVEN T O HER AT THE TIME OF MARRIAGE IN THE YEAR 1945 WHICH WAS IN ASSESSEES C USTODY FOR THE PURPOSE OF SAFETY FROM THEFTS, ETC. THE CIT(A) THEREAFTER H AS RESTRICTED THE CLAIM AFORESAID TO 1000 GRAMS OF GOLD AND 1 CARAT OF DIAM OND JEWELLERY I.E. THE CLAIM STANDS PARTLY ACCEPTED. IN THE SAME MANNER, THE CIT(A) ALSO DELETES THE A SSESSMENT OF VALUE OF 439.600 GRAMS JEWELLERY BY TAKING ITS NET INST EAD OF GROSS WEIGHT. ACCORDINGLY, HE HAS GRANTED PART RELIEF TO THE ASSE SSEE WHICH HAS MADE THE REVENUE AGGRIEVED. 14. WE HAVE GIVEN OUR THOUGHTFUL CONSIDERATION TO THE CONTENTIONS OF THE DR REPRESENTING THE REVENUE, WHOSE MAIN ARGUMENT IS THAT THE CIT(A) HAS WRONGLY INTERFERED WITH THE ADDITIONS IN QUESTION U NDER SECTION 69A OF THE I.T.A. I.T.A. I.T.A. I.T.A. NO NONO NOS SS S. .. .182 182182 1823 & 1824 3 & 1824 3 & 1824 3 & 1824/M/ /M/ /M/ /M/12 1212 12 8 ACT PERTAINING TO JEWELLERY IN QUESTION. WE MAK E IT CLEAR THAT IT HAS NOT PLACED ON RECORD ANY MATERIAL TO CONTROVERT THE FIN DINGS OF THE FACT ARRIVED AT BY THE CIT(A) AFTER CONSIDERING TOTALITY OF CIRCUMS TANCES OF THE CASE. IT IS A SETTLED PRINCIPLE OF LAW THAT THE CIT(A) I.E. THE L OWER APPELLATE AUTHORITY POSSESSES THE POWERS OF FIRST APPELLATE AUTHORITY A S WELL AS THOSE VESTED IN THE ASSESSING AUTHORITY. IN OUR VIEW, KEEPING IN MI ND THE SOCIO-ECONOMIC STATUS OF THE ASSESSEE AND HER FAMILY, THE CIT(A) H AS GRANTED PART RELIEF IN QUANTUM (SUPRA) TO THE ASSESSEE. APART FROM BALD AS SERTIONS RAISED BY THE REVENUE, THERE IS NO PLEA TO PROVE ANY ERROR OR INF IRMITY COMMITTED BY THE CIT(A). THEREFORE, WE UPHOLD CIT(A)S ORDER AND CON FIRM THE FINDINGS CONTAINED THEREIN. 15. AS SEQUEL TO OUR ABOVE DISCUSSIONS, BOTH THESE APPEALS ARE DISMISSED. ORDER PRONOUNCED ON TUESDAY, THE 26 TH OF MARCH, 2013 AT CHENNAI. SD/- SD/- (DR. O.K. NARAYANAN) VICE-PRESIDENT (S.S. GODARA) JUDICIAL MEMBER CHENNAI, DATED, THE 26.03.2013 VM/- TO: THE ASSESSEE//A.O./CIT(A)/CIT/D.R.