ITO, New Delhi V. Shri Pawan Kumar, New Delhi

ITA 186/DEL/2012

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 58929 (ITAT-DELHI)
• Duration Of Justice: 2 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-03-2012
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: F
• Next Hearing Date: 14-03-2012
• Assessment Year: 2008-2009
• Appeal Filed On: 12-01-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RENUKA JAIN GUPTA
• Assessee Lawyers: JUGAL KISHORE GULATI
• Keywords: Gift; Salary income
• Section: 143(3); 56(2)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH F NEW DELHI) BEFORE SHRI RAJPAL YADAV AND SHRI T.S. KAPOOR ITA NOS.185 & 186/DEL/2012 ASSESSMENT YEAR: 2008-09 INCOME-TAX OFFICER, VS. PAWAN KUMAR, WARD 45(2), D-205, PREM NAGAR, NEW DELHI. NAJAFGARH, N.DELHI. (PAN: ADUPK7990C) (APPELLANT) (RESPONDENT) CROSS OBJECTIONS NOS. 49 & 50/DEL/2012 ( IN ITA NOS.185 & 186/DEL/2012 ) ASSESSMENT YEAR: 2008-09 PAWAN KUMAR, VS. INCOME-TAX OFFICER, D-205, PREM NAGAR, WARD 45(2), NAJAFGARH, N.DELHI. NEW DELHI. (PAN: ADUPK7990C) (APPELLANT) (RESPONDENT) DEPARTMENT BY: SMT. RENUKA J AIN GUPTA, SR. DR ASSESSEE BY: SHRI JUGAL KISHORE GULATI, CA DATE OF HEARING : 14.03.2012 DATE OF PRONOUNCEMENT : 23.03.2012 ORDER PER RAJPAL YADAV: JUDICIAL MEMBER THE PRESENT APPEALS ARE DIRECTED AT THE INSTANCE OF REVENUE AGAINST THE COMMON ORDER OF LEARNED CIT(APPEALS) DATED 21.11.20 11 PASSED FOR ASSESSMENT YEAR 2008-09. ON RECEIPT OF NOTICE, ASSESSEE HAS FI LED CROSS-OBJECTIONS BEARING NOS. 40 & 50/DEL/2012. THE GRIEVANCE OF THE REVENUE IS THAT LEARNED CIT(APPEALS) HAS ERRED IN DELETING THE PENALTY OF RS.14,10,000 AND R S.14,05,000 IMPOSED BY THE ASSESSING OFFICER UNDER SECTION 271D AND 271E OF TH E INCOME-TAX ACT, 1961. IN THE 2 CROSS-OBJECTIONS, THE ASSESSEE HAS TAKEN 13 GROUNDS OF APPEAL WHEREIN HE HAS NOT POINTED OUT ANY SPECIFIC GRIEVANCE BUT RAISED THE A RGUMENTS WHICH WERE RAISED BEFORE THE LEARNED FIRST APPELLATE AUTHORITY. IN OT HER WORDS, CROSS-OBJECTIONS ARE BEING FILED BY THE ASSESSEE IN SUPPORT OF THE LEARN ED CIT(APPEALS)S ORDER. SUB- SECTION(4) OF SECTION 253 CONTEMPLATES THAT A RESPO NDENT CAN FILE CROSS-OBJECTIONS WITHIN 30 DAYS OF THE RECEIPT OF NOTICE OF THE APPE ALS. CROSS-OBJECTIONS WOULD BE VERIFIED IN THE PRESCRIBED MANNER AGAINST ANY PART OF THE ORDER OF THE LEARNED FIRST APPELLATE AUTHORITY. THE ITAT SHALL DISPOSE OF SUCH MEMORANDUM OF CROSS- OBJECTION AS IF IT WERE AN APPEAL PRESENTED WITHIN THE TIME SPECIFIED IN SUB-SECTION (3) OF THE ACT. THE ASSESSEE HAS NOT PROJECTED ANY GRIEVANCE AGAINST ANY PART OF THE LEARNED CIT(APPEALS)S ORDER. THUS, CROSS-OBJECTION S IN THE PRESENT FORM ARE NOT MAINTAINABLE. 2. AS REGARDS THE APPEALS OF REVENUE , THE BRIEF FA CTS ARE THAT ASSESSEE IS A SCHOOL TEACHER IN A GOVERNMENT CO-EDUCATION SENIOR SECONDA RY SCHOOL, KHERA DABUR, DELHI. HE DERIVES INCOME FROM SALARY. HE HAS FILED HIS RETURN OF INCOME-TAX ON 28 TH JULY 2008 DECLARING AN INCOME OF RS.1,00,220. THE C ASE OF THE ASSESSEE WAS SELECTED FOR SCRUTINY ASSESSMENT THROUGH CASH ON THE BASIS O F INFORMATION EXTRACTED FROM ANNUAL INFORMATION REPORT. A NOTICE UNDER SEC. 143( 2) OF THE ACT WAS ISSUED AND SERVED UPON THE ASSESSEE. AN ASSESSMENT ORDER WAS P ASSED UNDER SEC. 143(3) ON 24.11.2010. ASSESSING OFFICER HAS DETERMINED THE TA XABLE INCOME OF THE ASSESSEE AT RS.1,02,130. HE SIMPLY ADDED AN AMOUNT OF RS. 1,910 REPRESENTING INTEREST INCOME. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, IT REV EALED TO THE ASSESSING OFFICER 3 THAT AS PER AIR INFORMATION RECEIVED FROM AXIS BANK , A SUM OF RS.14,10,000 WAS DEPOSITED IN THIS BANK ACCOUNT. HE DIRECTED THE ASS ESSEE TO EXPLAIN THE SOURCE OF THE MONEY. THE ASSESSEE CONTENDED THAT HIS MOTHER SMT. SHEELVATI SOLD A PLOT BEARING NO. D-192A, PREM NAGAR, NAJAFGARH, DELHI FOR RS.9,1 0,000 TO SHRI RAKESH CHAND S/O SHRI TARA CHAND, VILLAGE: SAHLAWAS, DISTT. JHAJ HHAR (HR.). THE AMOUNT WAS RECEIVED IN CASH ON DIFFERENT DATES BETWEEN 26.6.20 07 TO 11.9.2007 AS PER THE AGREEMENT. A TOTAL AMOUNT OF RS.9,10,000 WAS DEPOSI TED IN THE ACCOUNT. THE ASSESSEE FURTHER POINTED OUT THAT SMT. SHEELVATI IS A RETIRE D TEACHER AND STAYED AT JHAJHHAR. ASSESSING OFFICER HAS RECORDED THE STATEMENT OF SMT . SHEELVATI AND INQUIRED WHY SHE HAS RECEIVED ALL THE AMOUNTS IN CASH. SHE REPLI ED THAT A REQUEST WAS MADE TO SHRI RAKESH CHAND TO GIVE THE AMOUNT BY CHEQUE BUT HE RE FUSED, THEREFORE, SHE AGREED TO RECEIVE THE ENTIRE AMOUNT IN CASH. ASSESSING OFFICE R THEREAFTER ASKED HER AS TO WHY SHE HAS NOT DEPOSITED THE SAID CASH IN HER BANK ACC OUNT WITH SBI, VILL:MATTANHAIL, DISTT. JHAJHHAR. SHE REPLIED THAT SHE INTENDED TO PURCHASE ANOTHER PLOT AT NAJAFGARH I.E. WHY SHE RECEIVED THE AMOUNT IN CASH AT NAJAFGARH. THIS AMOUNT WAS GIVEN TO SHRI PAWAN KUMAR. HE OPENED BANK ACCOUNT I N AXIS BANK, NAJAFGARH FOR SMT. SHEELVATI AND DEPOSITED THE ENTIRE CASH RECEIP T AMOUNTING TO RS. 9,10,000 IN THAT ACCOUNT. THE ASSESSEE FURTHER CONTENDED THAT HER MOTHER BOUGHT ANOTHER PLOT IN TODARMAL NAGAR, NAJAFGARH FOR A CONSIDERATION OF RS.8,50,000 AND THE PAYMENT WAS MADE BETWEEN 13.8.2007 TO 4.10.2007 BY WITHDRAW ING THE MONEY FROM THE AXIS BANK. ASSESSING OFFICER WAS SATISFIED WITH THE EXPL ANATION OF THE ASSESSEE AND HE DID NOT MAKE ANY ADDITION ON ACCOUNT OF UNEXPLAINED CAS H. HOWEVER, LEARNED ASSESSING 4 OFFICER HAD OBSERVED THAT PENALTY UNDER SEC. 271D A ND 271E OF THE INCOME-TAX ACT, 1961 DESERVE TO BE INITIATED AGAINST THE ASSESSEE. 3. IN THIS WAY, SHOW-CAUSE NOTICES WERE ISSUED TO T HE ASSESSEE INVITING HIS EXPLANATION AS TO WHY PENALTY UNDER SEC. 271D FOR A CCEPTING THE DEPOSIT IN CASH BE NOT IMPOSED. SIMILARLY, EXPLANATION OF THE ASSESSEE WAS SOUGHT AS TO WHY PENALTY UNDER SECTION 271E OF THE ACT BE NOT IMPOSED UPON T HE ASSESSEE FOR REPAYMENT OF LOAN IN CASH. ASSESSEE HAS CONTENDED THAT SMT. SHEE LVATI IS HIS MOTHER. HE IS THE ONLY SON. SHE IS AN OLD LADY AND HAS NO BANK ACCOUNT AT NAJAFGARH AND HER NATIVE VILLAGE IS ABOUT 100 KMS. FROM DELHI. SHE SOLD THE PLOT THR OUGH POWER OF ATTORNEY ON 19 TH SEPTEMBER, 2007 FOR A CONSIDERATION OF RS.9,10,000. SHE HAS HANDED OVER THE MONEY TO THE ASSESSEE AS IT WAS NOT SAFE TO KEEP SO MUCH AMOUNT OF CASH AT HOME. THE ASSESSEE HAS NOT ACCEPTED THE AMOUNT AS A LOAN. THE AMOUNT WAS USED BY HIS MOTHER FOR PURCHASE OF A NEW PLOT IN HER NAME. THEREFORE, THE QUESTION DOES NOT ARISE FOR VISITING THE ASSESSEE WITH PENALTY UNDER SEC. 271D AND 271E OF THE ACT. THE ASSESSEE HAD MADE REFERENCE TO A LARGE NUMBER OF DECISIONS W HICH HAVE DULY BEEN NOTICED BY THE LEARNED ASSESSING OFFICER. LEARNED ASSESSING OF FICER TOOK INTO CONSIDERATION JUDGMENT OF THE HON'BLE SUPREME COURT IN THE CASE O F ASSISTANT DIRECTOR OF INSPECTION VS. KUMARI A.B.SHANTI REPORTED IN 255 IT R 258 WHEREIN THE HONBLE COURT HAS OBSERVED THAT WHERE THERE HAS BEEN A GENU INE AND BONA FIDE TRANSACTION AND IF FOR ANY REASON, THE TAX PAYER COULD NOT GET A LOAN OR DEPOSIT BY ACCOUNT PAYEE CHEQUE OR DEMAND DRAFT FOR SOME BONA FIDE REASONS, THE AUTHORITY VESTED WITH THE POWERS TO IMPOSE PENALTY HAS GOT DISCRETIONARY POWE RS. ASSESSING OFFICER HAS OBSERVED THAT ASSESSEE FAILED TO DEMONSTRATE THE UR GENCY OF LOAN OR BONA FIDE REASON 5 FOR ACCEPTING THE LOAN AS WELL AS ITS REPAYMENT. HE IMPOSED A PENALTY OF RS.14,10,000 UNDER SEC. 271D AND RS.14,05,000 UNDER SEC. 271E OF THE ACT. 4. BEFORE LEARNED CIT(APPEALS), IT WAS CONTENDED BY THE ASSESSEE THAT TOTAL AMOUNT INVOLVED IS OF RS.9,10,000 WHICH WAS DEPOSIT ED AND WITHDRAWN, HOWEVER, LEARNED ASSESSING OFFICER HAS IMPOSED PENALTY OF RS .14,10,000 U/S. 271D AND RS.14,05,000 UNDER SEC. 271E OF THE ACT. THE EXPLAN ATION OF THE ASSESSEE HAS BEEN NOTICED BY THE LEARNED CIT(APPEALS) IN PARAGRAPH NO . 6, WHICH READS AS UNDER: 6. MY MOTHER PURCHASED ANOTHER PLOT VIDE GPA DATED 04.10.2007 IN TODARMAL COLONY NAJAFGARH FOR RS.8,50,000. THE PAYM ENT WAS MADE IN DIFFERENT DATES BETWEEN 13.08.2007 AND 04.10.2007. I WITHDRAW RS.7,50,000 ON 13.08.2007 BY TWO WITHDRAWALS OF RS.2,00,000. I WIT HDRAW RS. 7,50,000 ON 13.08.2007 BY TWO WITHDRAWALS OF RS.2,00,000 AND RS .5,50,000 TO PAY THE ADVANCE MONEY FOR THE PURCHASE OF PLOT BY MOTHER. B UT THE SELLER OF THE PLOT REFUSE TO ACCEPT RS.7,50,000 AS CASH. SO THE AMOUNT OF RS.2,50,000 WAS PAID ADVANCE MONEY AND THE BALANCE AMOUNT OF RS.5,00,000 WAS DEPOSITED BACK TO MY ACCOUNT WITH AXIS BANK ON NEXT DATE I.E. 14.08.2 007. AFTER THAT THE SELLER OF THE PLOT ASKED MY MOTHER TO GIVE A PAY ORDER OF RS.3,00,000 IN FAVOUR OF MEERA JUNEJA AND PAYMENT WAS MADE ON 21.08.2007. TH EN THE SELLER AGAIN ASKED MY MOTHER FOR A PAY ORDER OF RS.2,00,000 SO T HE PAY ORDER OF RS.2,00,000 WAS MADE IN F/O MEERA JUNEJA ON 01.10.2 007. MY MOTHER ASKED THE SELLER TO COLLECT THE PAY ORDER OF RS.2,00,000 IN F/O MEERA JUNEJA BUT THE SELLER REFUSED TO ACCEPT THE PAY ORDER IN F/O MEERA JUNEJA AND GAVE ANOTHER NAME MALA ARORA IN PLACE OF MEERA JUNEJA. SO I GOT CANCELLED THE PAY ORDER OF RS.2,00,000 FROM AXIS BANK ON 04.10.2007 AND GOT ANOTHER PAY ORDER OF RS.2,00,000 IN F/O MALA ARORA. BOTH THE PAY ORDERS WERE MADE AS PER DIRECTIONS OF THE SELLER OF PLOT. 6 5. LEARNED FIRST APPELLATE AUTHORITY HAS MADE A DET AILED ANALYSIS AND THEREAFTER DELETED THE PENALTY. 6. LEARNED DR RELIED UPON THE ORDERS OF THE ASSESSI NG OFFICER. SHE POINTED OUT THAT ASSESSEE HAS TAKEN THE MONEY IN CASH AND REPAI D THE ALLEGED LOAN IN CASH, THEREFORE, BOTH HIS ACTIONS FALL WITHIN THE AMBIT O F SECTION 269SS AND 269T OF THE INCOME-TAX ACT, 1961. THE ASSESSEE DESERVES TO BE V ISITED WITH PENALTY UNDER SECTION 271D AS WELL AS 271E OF THE ACT. ON THE OTHER HAND, LEARNED COUNSEL FOR THE ASSESSEE RELIED UPON THE ORDER OF THE LEARNED CIT(APPEALS) A S WELL AS THE SUBMISSIONS MADE IN THE CROSS-OBJECTIONS. HE POINTED OUT THAT AT THE MOST THE MONEY CAN BE TREATED AS A GIFT FROM THE MOTHER TO THE SON AND IT IS EXEMPT FROM TAX UNDER SEC. 56(2) OF THE ACT. ACCEPTANCE OF GIFT IN CASH OR MAKING OF GIFT I N CASH BY THE ASSESSEE TO HIS MOTHER COULD NEVER AUTHORIZE THE ASSESSING OFFICER TO VISI T WITH PENALTY UNDER SECTION 271D AND 271E OF THE ACT. 7. WE HAVE DULY CONSIDERED THE RIVAL CONTENTIONS AN D GONE THROUGH THE RECORD CAREFULLY. THERE IS NO DISPUTE WITH REGARD TO THE P ROPOSITION THAT SECTION 269SS AND 269T OF THE ACT CONTEMPLATES THAT IF AN ASSESSEE AC CEPTS LOAN AND DEPOSIT AFTER THE 30 TH DAY OF JUNE 1984, IN EXCESS OF THE PERMISSIBLE LIM IT OTHERWISE THEN BY AN ACCOUNT PAYEE CHEQUES OR ACCOUNT PAYEE DEMAND DRAFT THEN HE WILL BE VISITED WITH PENALTY UNDER SEC. 271D OF THE ACT. SIMILARLY, IF SUCH LOAN IS REPAID IN CASH EXCEEDING THE MONITORY LIMIT PROVIDED IN SECTION 269T OTHERWISE T HEN BY AN ACCOUNT PAYEE CHEQUE 7 OR ACCOUNT PAYEE BANK DRAFT THEN HE WILL BE VISITED WITH PENALTY UNDER SEC. 271E OF THE ACT. THERE ARE EXCEPTIONS PROVIDED IN SECTION 2 69SS AND 269T BUT THE AMBIT AND CONSTRUCTION OF THE PROVISIONS ARE NOT IN DISPUTE I N THE PRESENT APPEALS. THE ISSUE IS WHETHER ASSESSEE, IN FACT, HAS TAKEN LOAN FROM HIS MOTHER AND MADE REPAYMENT OF THE LOAN. WHETHER TRANSACTION AT THE END OF THE ASS ESSEE IS A BONA FIDE ONE OR IT WAS USED IN ORDER TO AVOID THE TAX. THE ASSESSEE AS WEL L AS HIS MOTHER APPEARED BEFORE THE ASSESSING OFFICER. HIS MOTHER IS A RETIRED SCHO OL TEACHER AND HE IS A SCHOOL TEACHER. ACCORDING TO THE ASSESSEE, HE HAS NOT TAKE N ANY LOAN FROM HIS MOTHER RATHER HE KEPT THE MONEY IN SAFE CUSTODY IN THE CAPACITY O F A CUSTODIAN. THE PLOT WAS SOLD BY THE MOTHER AND NEW PLOT WAS ALSO PURCHASED BY TH E MOTHER. THE SALE PROCEEDS OF THE PLOT SOLD HAS BEEN UTILIZED FOR THE PURCHASE OF THE PLOT. THE ROLE OF THE ASSESSEE IS THAT HE IS HAVING A BANK ACCOUNT WHERE THE AMOUNT W AS DEPOSITED OR WITHDRAWN. IF WE LOOK TOWARDS THIS TRANSACTION WITH THE SOCIAL AN D ECONOMIC BACKGROUNDS OF THE ASSESSEE AS WELL AS HIS MOTHER THEN IT WOULD REVEAL THAT THEY HAVE NOT ADOPTED ANY MODUS OPERANDI TO GENERATE BLACK MONEY. THEY HAVE A CTED IN A BONA FIDE WAY. THE MOTHER HAS A FAITH IN HER ONLY SON AND SHE HANDED O VER HER MONEY FOR KEEPING THE SAME IN SAFE CUSTODY. WE COULD UNDERSTAND THE CASE OF ASSESSING OFFICER, HAD THE AMOUNT WAS USED BY THE ASSESSEE FOR HIS PERSONAL BE NEFIT THEN THE POSSIBILITY OF BEING LOAN CAN BE USED. EVEN OTHERWISE ALSO THE MOTHER CO ULD MAKE A GIFT TO THE SON AND VICE-VERSA. THE FACTS SHOULD BE VIEWED IN A NATURAL PERSPECTIVE HAVING REGARD TO THE COMPULSION OF A CASE, WHERE IT IS POSSIBLE TO DRAW TWO INFERENCES FROM THE FACTS AND WHERE THERE IS NO EVIDENCE OF ANY DISHONEST OR IMPR OPER MOTIVE ON THE PART OF THE ASSESSEE, IT WOULD BE JUST EQUITABLE TO DRAW SUCH I NFERENCE IN SUCH A MANNER THAT 8 WOULD LEAD TO EQUITY AND JUSTICE. TOO HYPER TECHNIC AL OR LEGALISTIC APPROACH SHOULD BE AVOIDED WHILE DEALING WITH HUMAN AFFAIRS. TAKING INTO CONSIDERATION THE FACTS AND CIRCUMSTANCES, WE DO NOT SEE ANY REASON TO INTE RFERE IN THE ORDER OF LEARNED CIT(APPEALS). CONSEQUENTLY, THE APPEALS AS WELL AS CROSS-OBJECTIONS ARE DISMISSED. 8. DECISION PRONOUNCED IN THE OPEN COURT ON 23.03 .2012 SD/- SD/- ( T.S. KAPOOR ) ( RAJPAL YADAV ) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 23/03/2012 MOHAN LAL COPY FORWARDED TO: 1) APPELLANT 2) RESPONDENT 3) CIT 4) CIT(APPEALS) 5) DR:ITAT ASSISTANT REGISTRAR