GEETHA T. MARIAPPAN, BANGALORE V. ITO WD 11(2)(3), MUMBAI

ITA 1841/MUM/2013

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 3831 (ITAT-MUMBAI)
• Duration Of Justice: 3 year(s) 1 month(s) 30 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-05-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: G
• Next Hearing Date: 03-05-2016
• Assessment Year: 2007-2008
• Appeal Filed On: 07-03-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S K BEPARI
• Keywords: Gift
• Section: 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCH G, MUMBAI BEFORE SHRI R.C. SHARMA, ACCOUNTANT MEMBER AND SHRI SANJAY GARG, JUDICIAL MEMBER ITA NO.1841/M/2013 ASSESSMENT YEAR: 2007-08 SMT. GEETHA T. MARIAPPAN, BLOCK A-1, FDC DEPARTMENT SYNGENE INTERNATIONAL LIMITED, BIOCON PARK, PLOT NO.2 & 3, BOMMASANDRA IV PHASE JIGANI LINK ROAD, BANGALORE - 560 099 PAN: AEIPT 6665C VS. ITO WD 11(2)(3), MUMBAI (APPELLANT) (RESPONDENT) PRESENT FOR: ASSESSEE BY : SHRI DEVENDRA JAIN, A.R. REVENUE BY : SHRI S.K. BEPARI, D.R. DATE OF HEARING : 03.05.2016 DATE OF PRONOUNCEMENT : 06.05.2016 O R D E R PER SANJAY GARG, JUDICIAL MEMBER: THE PRESENT APPEAL HAS BEEN PREFERRED BY THE ASSES SEE AGAINST THE ORDER DATED 01.01.2013 OF THE COMMISSIONER OF INCOME TAX (APPEALS) [HEREINAFTER REFERRED TO AS THE CIT(A)] RELEVANT TO ASSESSMENT Y EAR 2007-08. 2. THE ASSESSEE HAS TAKEN THE FOLLOWING GROUNDS OF APPEAL: 1. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF T HE CASE. LD. CIT(A) HAS ERRED IN HOLDING THAT GROUND NO.1 REFERRING TO UNEX PLAINED INVESTMENT IN FLAT AND GROUND NO.2 REFERRING TO UNEXPLAINED CASH DEPOSIT IN BANK ACCOUNT ARE INTERLINKED WITH EACH OTHER. 2. (A) THAT THE OBSERVATION OF LD. CIT(A) THAT INIT IAL PAYMENT FOR ACQUISITION OF FLAT WAS MADE FROM CASH LOAN AS PER BORROWAL NOTES IS CONTRARY TO FACTS ON RECORD. (B) THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, LD. C.I.T.(A) HAS FAILED TO APPRECIATE THAT INITIAL PAYMENT FOR A CQUISITION OF FLAT WAS MADE THROUGH CHEQUES AS PER MEMORANDUM OF CONSIDERATION APPEARING IN THE DEED OF CONVEYANCE. ITA NO.1841/M/2013 SMT. GEETHA T. MARIAPPAN 2 (C) THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, LD. C.I.T.(A) IS WRONG IN DISMISSING GROUND NO.1 WITHOU T GIVING ANY FINDINGS ON THE CONTENTIONS RAISED AT THE APPEAL ST AGE THAT INITIAL PAYMENT FOR ACQUISITION IN FLAT WAS MADE THROUGH FO LLOWING CHEQUES:- BANK CHEQUE NO. DATE AMOUNT (RS .) IDBI 070879 05.06.2066 4,00,000 ICICI BANK 962582 03.07.2006 31,000 ICICI BANK 962584 03.07.2006 50,000 ICICI BANK 839096 03.07.2006 70,000 (D) THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE ACTION OF LD. C.I.T.(A) TO CONFIRM ADDITION OF RS.5,51,000 /- TOWARDS INVESTMENT IN FLAT BY DISMISSING GROUND NO.1 IS ERR ONEOUS, ARBITRARY AND BAD. 3. (A) THAT ON THE FACTS AND IN THE CIRCUMSTANCES O F THE CASE, LD. C.I.T.(A), HAVING ADMITTED RECEIPT OF LOAN OF RS.3, 50,000/- FROM MOTHER AND AUNTY HAS ERRED TO DISMISS GROUND NO.2 BY ENTER TAINING IRRELEVANT AND EXTRANEOUS CONSIDERATIONS. B) THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF TH E CASE, LD. C.I.T.(A) IS WRONG IN UPHOLDING THE ADDITION OF RS. 1,75,342/- REPRESENTING CASH DEPOSITS IN BANK ACCOUNT ON 28.07 .2006, 02.08.2006, 26.10.2006 AND 30.10.2006. 4. THAT THE APPELLANT CRAVES LEAVE TO ADD, ALTER, ADDUCE OR AMEND ANY GROUND OR GROUNDS ON FOR BEFORE THE DATE OF HEARING OF THE APPEAL. 3. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSE E JOINTLY WITH HER HUSBAND PURCHASED FLOOR NO.104 AT SATELLITE GARDEN, GOREGAO N, MUMBAI FOR A CONSIDERATION OF RS.35,51,000/- AS PER AGREEMENT DA TED 09.08.2006. THE ISSUE INVOLVED IN THIS CASE IS REGARDING THE SOURCE OF FU NDS FOR THE PURCHASE OF THE ABOVE FLOOR. THE ASSESSING OFFICER (HEREINAFTER RE FERRED TO AS THE AO) IN THE ASSESSMENT ORDER OBSERVED THAT THE ASSESSEE HAD EXP LAINED THE SOURCE OF INVESTMENT AS RS.30 LAKHS TAKEN AS LAON FROM ICICI BANK AND THE BALANCE AS LOANS/GIFTS RECEIVED FROM HER MOTHER IN LAW AND ALS O FROM HER RELATIVES AND OUT OF THE PAST SAVINGS. THE AO EXAMINED THE BANK ACCO UNT STATEMENT OF THE ASSESSEE AND OBSERVED THAT THE ASSESSEE HAD DEPOSIT ED THE FOLLOWING CASH IN THE SAID ACCOUNT. DATE AMOUNT 28.7.06 49,900 ITA NO.1841/M/2013 SMT. GEETHA T. MARIAPPAN 3 2.8.06 30,700 26.10.06 49,000 30.10.06 45,742 _______ TOTAL 1,75,342 THE AO ALSO OBSERVED THAT THE ASSESSEE AND HER HUS BAND HAD SHOWN TO HAVE RECEIVED LOANS FROM THE FOLLOWING PERSONS IN C ASH WHICH WERE DEPOSITED IN THE BANK ACCOUNT. 1) V. KUTHALINGAM 2,00,000 2) T. MARIAMMAL 1,00,000 3) T. RANI 1,25,000 4) R. SHUSHILA 1,25,000 5) R. THERASAMNAL 1,00,000 _______ TOTAL 6,50,000 THE AO OBSERVED THAT THE ASSESSEE HAD SHOWN TO HAVE RECEIVED THE ABOVE LOANS IN CASH BUT THE ASSESSEE HAD FAILED TO PROVE THE CAPACITY OF THE LENDERS TO ADVANCE THE LOAN AND THE GENUINENESS OF THE TRANSACTIONS. THE AO, THEREFORE, TREATED THE PAYMENT OF RS.5,51,000/- TO THE SELLER AND CASH DEPOSITED OF RS.1,75,342/- AS UNEXPLAINED INCOME OF THE ASSES SEE OUT OF THE ABOVE STATED DEPOSITS. 4. THE LD. CIT(A) CONFIRMED THE ABOVE ADDITIONS MAD E BY THE AO. BEING AGGRIEVED, THE ASSESSEE HAS COME IN APPEAL BEFORE U S. 5. THE LD. A.R. OF THE ASSESSEE, BEFORE US, HAS SUB MITTED THAT THE AO HAS COMMITTED A MISTAKE WHILE ANALYZING THE FACTS OF TH E CASE REGARDING THE ADDITION OF RS.1,75,342/-. THE LD. A.R. HAS SUBMIT TED THAT THE ASSESSEE HAD BORROWED CASH LOANS FROM HER MOTHER AND HER AUNTY A GGREGATING RS.3,50,000/- OUT OF THIS SHE HAD DEPOSITED RS.1,75,342/- IN BANK ACCOUNT. THE DETAIL OF WHICH IS SUBMITTED AS UNDER: DATE OF DEPOSIT AMOUNT (RS.) 28.07.2006 49,900/- 02.08.2006 30,700/- ITA NO.1841/M/2013 SMT. GEETHA T. MARIAPPAN 4 26.10.2006 49,000/- 31.10.2006 45,742/- ________ TOTAL 1,75,342/- THE LD. A.R. HAS FURTHER SUBMITTED THAT THE RELEVAN T EVIDENCES SUCH AS CASH FLOW STATEMENT, IDENTITY PROOF OF LENDERS, BAN K STATEMENT SHOWING THE WITHDRAWALS FROM BANK OF THE LENDERS AND CERTIFICAT E OF FARMERS SOCIETY FOR LOAN TAKEN ETC. WERE FURNISHED BEFORE THE AO. THE LD. A. R. HAS EXPLAINED THAT SO FAR AS THE ADDITION OF RS.5,51,000/- IS CONCERNED, THE SAID AMOUNT WAS PAID BY THE ASSESSEE TO THE SELLER FOR THE PURCHASE OF THE FLAT AND THE SOURCE OF THE FUNDS WAS AS UNDER: DATE CHEQUE NO. DRAWN ON AMOUNT (RS) REMARKS 05.06.2006 70879 IDBI 4,00,000 PAYMENT MADE DIRECTLY BY MR. VEKAT GIRI TO MR. RAMESH KHANNA, SELLER OF FLAT, ON BEHALF OF APPELLANT. 03.07.2006 962582 ICICI 31,000 PAYMENT MADE THROUGH APPELLANTS HUSBANDS ACCOUNT. 03.07.2006 962584 ICICI 50,000 19.07.2006 839096 ICICI 70,000 PAYMENT MADE BY APPELLANT TOTAL 5,51,000 THE ASSESSEE, THUS, EXPLAINED THAT A SUM OF RS.4 LA KHS WAS RECEIVED AS LOAN FROM MR. VEKAT GIRI AND THE SAID AMOUNT WAS DI RECTLY TRANSFERRED BY SAID MR. VEKAT GIRI TO THE SELLER THROUGH BANKING CHANNE L. THE SOURCE OF THE REST OF THE AMOUNT WAS ALSO EXPLAINED AND THE PAYMENTS WERE MADE THROUGH BANKING CHANNEL ONLY. THE LD. A.R. HAS FURTHER SUBMITTED T HAT EVEN THE ASSESSEE, OUT OF THE BORROWED AMOUNT OF RS.4 LAKH FROM MR. VEKAT GIR I, HAS REPAID A ITA NO.1841/M/2013 SMT. GEETHA T. MARIAPPAN 5 SUBSTANTIAL PART OF IT. THE LD. A.R. HAS THEREFORE PLEADED THAT WHILE MAKING THE ADDITION UNDER SECTION 68 OF THE ACT, THE AO HAS MI STAKEN HIMSELF WHILE GATHERING THE ACTUAL FACTS OF THE CASE. THE AO IN THE ASSESSMENT ORDER HAS MADE THE ADDITION OF RS.5,51,000/- TREATING THE SAM E AS UNEXPLAINED LOANS WHEREAS THE SOURCE OF THE AMOUNT OF RS.5,51,000/- W AS DULY EXPLAINED AND THE SAME WAS MADE THROUGH BANKING CHANNEL. 6. AT THIS STAGE, BOTH THE LD. REPRESENTATIVES OF T HE PARTIES HAVE SUBMITTED THAT THE MATTER IS NEEDED TO BE RESTORED TO THE FIL E OF THE AO FOR RE-APPRECIATION OF THE ACTUAL FACTS. 7. WE, ACCORDINGLY, RESTORE THIS ISSUE TO THE FILE OF THE AO FOR ASSESSMENT AFRESH ON THE ABOVE ISSUE. NEEDLESS TO SAY THAT TH E AO WILL GIVE PROPER OPPORTUNITY TO THE ASSESSEE TO EXPLAIN THE SOURCE O F FUNDS ETC. AND WILL CONSIDER THE EVIDENCES, IF ANY, FURNISHED BY THE ASSESSEE TO PROVE HER CASE. 8. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS TRE ATED AS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 06.05.2016. SD/- SD/- (R.C. SHARMA) (SANJAY GARG) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI, DATED: 06.05.2016. * KISHORE, SR. P.S. COPY TO: THE APPELLANT THE RESPONDENT THE CIT, CONCERNED, MUMBAI THE CIT (A) CONCERNED, MUMBAI THE DR CONCERNED BENCH //TRUE COPY// [ BY ORD ER DY/ASSTT. REGISTRAR, ITAT, MUMBAI.