Shri Jayeshbhai M. Patel, Bharuch V. The Income tax Officer,Ward-3., Bharuch

ITA 1862/AHD/2007

• Counselvise Citation: 186220514 RSA 2007
• Duration Of Justice: 4 year(s) 4 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-09-2011
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Next Hearing Date: 30-08-2011
• Assessment Year: 2004-2005
• Appeal Filed On: 04-05-2007
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: JAI RAJ KUMAR
• Assessee Lawyers: SUNIL H TALATI
• Keywords: Opportunity of being heard; Set aside
• Section: 10(14); 234B; 147; 69; 10

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, A BENCH, AHMEDABAD BEFORE SHRI T. K. SHARMA, JUDICIAL MEMBER AND SHRI A. K. GARODIA, ACCOUNTANT MEMBER I.T.A. NO.1861, 1862 / AHD/2007 (ASSESSMENT YEAR 2003-04 & 2004-05) SHRI JAYESHBHAI M PATEL, A-1, SIDHI VINAYAK SOCIETY NEAR DHRAMA NAGAR, BHARUCH VS. ITO, WARD 3, BHARUCH PAN/GIR NO. : ADOPP3864G (APPELLANT) .. (RESPONDENT) APPELLANT BY: SHRI SUNIL H TALATI, AR RESPONDENT BY: SHRI JAI RAJ KUMAR, SR. DR DATE OF HEARING: 30.08.2011 DATE OF PRONOUNCEMENT: 23.09.2011 O R D E R PER SHRI A. K. GARODIA, AM:- BOTH THESE APPEALS ARE FILED BY THE ASSESSEE WHICH ARE DIRECTED AGAINST TWO SEPARATE ORDERS OF CIT(A) VI, BARODA BO TH DATED 26.02.2007 FOR THE ASSESSMENT YEARS 2002-03 & 2004-05. FOR TH E SAKE OF CONVENIENCE, BOTH THESE APPEALS ARE BEING DISPOSED OFF BY WAY OF THIS COMMON ORDER. 2. FIRST WE TAKE UP THE APPEAL OF THE ASSESSEE FOR THE ASSESSMENT YEAR 2003-04 IN I.T.A.NO. 1861/AHD/2007. THE GROUNDS R AISED BY THE ASSESSEE ARE AS UNDER: YOUR APPELLANT BEING DISSATISFIED WITH THE ORDER PA SSED BY DIE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) VI, BA RODA DATED 26.02.207 I.T.A.NO. 1681, 1682 /AHD/2007 2 PRESENTS THESE GROUNDS OF APPEALS AGAINST THE SAID ORDER ON THE FOLLOWING AMONGST OTHER GROUNDS :- 1. THE LEARNED CIT(A) HAS ERRED IN UPHOLDING THE AC TION OF AO OF INVOKING PROVISIONS OF SECTION 147 OF THE ACT. Y OUR APPELLANT SUBMITS THAT RE-OPENING IS BAD IN LAW AND CONTRARY TO LEGAL PRONOUNCEMENTS. IT BE HELD SO NOW AND ORDER PASSED BE CANCELLED. 2. THE LEARNED CIT(A) HAS ERRED IN HOLDING THAT E NTIRE ADDITIONAL CONVEYANCE \ ALLOWANCE OF RS 72,386 AND 50% OF CONVEYANCE ALLOWANCE OF RS 12,060 IS TAXABLE. YOUR APPELLANT SUBMITS THAT ENTIRE ADDITIONAL CONVEYANCE ALLOWAN CE RECEIVED OF RS 72,386 AND ENTIRE CONVEYANCE ALLOWANCE BE HELD E XEMPT AND ADDITION MADE BY THE AO BE DELETED IN TOTO. 3. THE LEARNED C!T(A) HAS ERRED IN HOLDING THAT 30 % OF INCENTIVE BONUS I.E. RS 47,014 IS TAXABLE. YOUR APP ELLANT SUBMITS THAT 30% OF INCENTIVE BONUS BE HELD EXEMPT U/S 10(1 4) OF THE ACT. IT BE HELD SO NOW. 4. THE LEARNED CIT(A) HAS ERRED IN CONFIRMING THE ACTION OF THE AO OF CHARGING INTEREST U/S 234B AND 234D OF TH E ACT. YOUR APPELLANT SUBMITS THAT LEVY OF INTEREST BEING INCOR RECT, BE DELETED NOW. YOUR APPELLANT CRAVES FOR LEAVE TO ALTER/AMEND/WITHDRAW/MODIFY ANY OF THE ABOVE GROUND S BEFORE HEARING. 3. IT WAS SUBMITTED BY THE LD. A.R. THAT GROUND NO. 1 IS NOT PRESSED AND ACCORDINGLY, THIS GROUND IS REJECTED AS NOT PRE SSED. 4. REGARDING GROUND NO.4, IT WAS POINTED OUT THAT T HE ISSUE REGARDING CHARGING OF INTEREST U/S 234B AND 234D IS CONSEQUEN TIAL. WE HOLD ACCORDINGLY. 5. REGARDING GROUND NO.2, IT WAS SUBMITTED THAT IT IS NOTED BY THE A.O. IN PARA 3 OF THE ASSESSMENT ORDER THAT FROM TH E COMPUTATION OF INCOME, IT IS NOTED THAT ASSESSEE HAD CLAIMED DEDUC TION OF RS.72386/- I.T.A.NO. 1681, 1682 /AHD/2007 3 UNDER SUB-CLAUSE (I) OF CLAUSE (14) OF SECTION 10 O F THE INCOME TAX ACT, AGAINST AN AMOUNT OF RS.40,000/- OF ADDITIONAL CONV EYANCE ALLOWANCE ALREADY ALLOWED BY THE EMPLOYER IN FORM 16 DURING T HIS YEAR. THE A.O. ASKED THE ASSESSEE TO FURNISH THE PROOF OF WORKING OF EXCESS DEDUCTION OF RS.32,386/- CLAIMED BY THE ASSESSEE AND IT WAS ALSO REQUESTED TO PROVIDE THE EVIDENCE OF BASIS ON WHICH IT HAS BEEN TREATED AS EXEMPT FROM INCOME TAX U/S 10(14) OF THE ACT. THE ASSESSEE SUBMITTED SOME DETAILS IN REPLY BUT THE A.O. WAS NOT SATISFIED. IT WAS ALSO SUBMIT TED BY THE ASSESSEE BEFORE THE A.O. THAT THE EMPLOYER I.E. LIC OF INDIA , DOES NOT PROVIDE VEHICLE TO HIM AND HENCE HE HAD TO INCUR HUGE EXPEN DITURE ON VEHICLE. THEREAFTER, IT IS NOTED BY THE A.O. THAT THE EMPLOY ER I.E. LIC VIDE ITS ORDER DATED 24.11.2005 HAS STATED THAT VEHICLE IS PROVIDE D BY THE LIC TO DEVELOPMENT OFFICES FOR DEVELOPMENT OF THE FIELD AC TIVITIES AND SUPERVISION OF LICS NEW BUSINESS AND ADDITIONAL CO NVEYANCE ALLOWANCE IS CONSIDERED FOR EXEMPTION ON THEIR WORKING PERFOR MANCE AND FULFILLMENT OF NORMS AS PRESCRIBED BY CENTRAL OFFICE MUMBAI. T HE A.O. HELD THAT THE ENTIRE CONVEYANCE ALLOWANCE AND ADDITIONAL CONVEYAN CE ALLOWANCE OF RS.24,120/- AND RS.72,386/- RESPECTIVELY ARE NOT AD MISSIBLE AS DEDUCTION. HE MADE ADDITION OF BOTH THESE AMOUNTS. BEING AGGR IEVED, THE ASSESSEE CARRIED THE MATTER IN APPEAL BEFORE CIT(A). IT WAS HELD BY CIT(A) THAT ENTIRE ADDITIONAL CONVEYANCE ALLOWANCE OF RS.72,386 /- AND 50% OF THE CONVEYANCE ALLOWANCE I.E. RS.24,120/- IS TAXABLE AN D ONLY 50% OF CONVEYANCE ALLOWANCE IS EXEMPT. NOW, THE ASSESSEE IS IN FURTHER APPEAL BEFORE US. 6. IT IS SUBMITTED BY THE LD. A.R. THAT FORM 16 ISS UED BY LIC OF INDIA IN ASSESSMENT YEAR 2003-04 IS AVAILABLE ON PAGES 1 & 2 OF THE PAPER BOOK AND IN THE SAME, IT CAN BE SEEN THAT EXEMPTION WAS ALLOWED BY THE EMPLOYER I.E. LIC OF INDIA FOR THE ENTIRE AMOUNT OF CONVEYANCE ALLOWANCE I.T.A.NO. 1681, 1682 /AHD/2007 4 OF RS.24,120/- AND OUT OF ADDITIONAL CONVEYANCE ALL OWANCE OF RS.72,386/- , LIC HAS CONSIDERED RS.40,000/- AS EXEMPT BEING IN CURRED ON PERFORMANCE OF DUTIES. IT IS ALSO SUBMITTED THAT I T WAS NOTED BY THE A.O. ALSO IN THE ASSESSMENT ORDER THAT IT WAS SUBMITTED BY THE LIC TO THE A.O. THAT ADDITIONAL CONVEYANCE ALLOWANCE IS CONSIDERED FOR EXEMPTION ON WORKING PERFORMANCE AND FULFILLMENT OF NORMS AS PRE SCRIBED BY THEIR CENTRAL OFFICE, MUMBAI. IT WAS SUBMITTED THAT SINC E TO THE EXTENT OF RS.40,000/-, IT WAS CONSIDERED BY THE LIC THAT THE SAME WAS INCURRED FOR PERFORMANCE OF DUTIES, THE CLAIM SHOULD BE ALLOWED AT LEAST TO THIS EXTENT. RELIANCE WAS PLACED ON THE TRIBUNAL DECISION RENDER ED IN THE CASE OF DCIT VS SHRI VIJASING D KHARACHIA, IN I.T.A.NO. 592 /AHD/1997 DATED 27.06.2005. RELIANCE WAS ALSO PLACED ON THE DECISI ON OF THE TRIBUNAL IN THE CASE OF JAGDISH K THAKKAR IN I.T.A.NO. 2588/AHD /2005 DATED 17.02.2006. HE SUBMITTED A COPY OF BOTH THESE TRIB UNAL DECISIONS. IT WAS POINTED OUT THAT IN THESE CASES, IT WAS HELD BY THE TRIBUNAL THAT HE ENTIRE AMOUNT OF ADDITIONAL CONVEYANCE ALLOWANCE IS EXEMPT U/S 10(14). IT IS ALSO SUBMITTED THAT ANOTHER TRIBUNAL DECISION RENDERED IN THE CASE OF ACIT VS PRADIP R. GANDHI IN I.T.A.NO. 1215/AHD/1998 DATED 24.02.2005. IN BOTH THESE CASES, IT IS SUBMITTED T HAT THE TRIBUNAL HAD FOLLOWED THE DECISION OF SPECIAL BENCH OF THE TRIBU NAL IN THE CASE OF P. DAYAKAR VS ITO AS REPORTED IN 53 ITD 25 (HYD.) (S.B .). AS AGAINST THIS, THE LD. D.R. OF THE REVENUE SUPPORTED THE ORDERS OF AUTHORITIES BELOW. 7. WE HAVE CONSIDERED RIVAL SUBMISSIONS, PERUSED TH E MATERIAL ON RECORD AND HAVE GONE THROUGH THE ORDERS OF AUTHORIT IES BELOW. WE FIND THAT IN THE PRESENT CASE, THE ASSESSEE IS A DEVELOP MENT OFFICE OF LIC OF INDIA AND IN ADDITION TO THE AMOUNT OF RS.24,120/- ON ACCOUNT OF CONVEYANCE ALLOWANCE, THE LIC HAS FURTHER PAID AN A MOUNT OF RS.72,386/- ON ACCOUNT OF ADDITIONAL CONVEYANCE ALLOWANCE. THE A.O. HELD THAT NO I.T.A.NO. 1681, 1682 /AHD/2007 5 PART OF BOTH OF THESE AMOUNTS IS EXEMPT. WHEREAS I T IS HELD BY THE LD. CIT(A) THAT 50% OF THE CONVEYANCE ALLOWANCE OF RS.2 4,120/- IS EXEMPT AND THE BALANCE AMOUNT OF CONVEYANCE ALLOWANCE AND THE TOTAL AMOUNT OF ADDITIONAL CONVEYANCE ALLOWANCE IS TAXABLE. THE CL AIM OF THE ASSESSEE IS THAT RECEIPT OF THESE ALLOWANCES I.E. CONVEYANCE AL LOWANCE AND ADDITIONAL CONVEYANCE ALLOWANCE IS EXEMPT U/S 10(14). AS PER THE PROVISIONS OF SECTION 10(14), ANY SPECIAL ALLOWANCE OR BENEFIT, N OT BEING IN THE NATURE OF A PERQUISITE, SPECIFICALLY GRANTED TO MEET EXPEN SES WHOLLY, NECESSARILY AND EXCLUSIVELY INCURRED IN THE PERFORMANCE OF THE DUTIES OF AN OFFICE OR EMPLOYMENT OF PROFIT IS EXEMPT TO THE EXTENT TO WHI CH SUCH EXPENSES ARE ACTUALLY INCURRED FOR THAT PURPOSE. HENCE, IT IS E SSENTIAL THAT ASSESSEE HAS TO BRING EVIDENCE ON RECORD AS TO HOW MUCH EXPENSE WERE ACTUALLY INCURRED FOR THE EMPLOYMENT OF THE ASSESSEE. IN TH E PRESENT CASE, NO EVIDENCE IN THIS REGARD HAS BEEN BROUGHT ON RECORD BY THE ASSESSEE. EVEN NO DETAILS OF SUCH EXPENSES INCURRED AND SOURCE THE REOF IN THE FORM OF FUND FLOW STATEMENT ETC., HAD BEEN BROUGHT ON RECOR D BY THE ASSESSEE EITHER BEFORE THE AUTHORITIES BELOW OR EVEN BEFORE US. HENCE, MERELY ON THE BASIS OF THE CONTENTION THAT EXPENSES WERE INCU RRED BY THE ASSESSEE AND THE AMOUNTS WERE REIMBURSED BY THE EMPLOYER, IT CANNOT BE ACCEPTED THAT SUCH ALLOWANCES RECEIVED BY THE ASSESSEE ARE E XEMPT U/S 10(14). EVEN IF HARD EVIDENCES ARE NOT MAINTAINED BY THE AS SESSEE, AT LEAST THE DETAILS OF SUCH EXPENSES INCURRED AND HOW SUCH EXPE NSES ARE RELATABLE TO THE PERFORMANCE OF DUTY, HAS TO BE SHOWN BY THE ASS ESSEE ALONG WITH SOURCE OF SUCH EXPENDITURE ETC. WE FEEL THAT IN TH E INTEREST OF JUSTICE, ONE MORE OPPORTUNITY MAY BE ALLOWED TO THE ASSESSEE TO BRING THESE DETAILS AND EVIDENCES ON RECORD IN SUPPORT OF THIS CLAIM TH AT EXPENSE WERE INCURRED FOR THE PERFORMANCE OF DUTY AND THE RECEIP T OF THESE ALLOWANCES ARE ONLY TO MEET SUCH EXPENSES. WE, THEREFORE, SET ASIDE THE ORDER OF LD. I.T.A.NO. 1681, 1682 /AHD/2007 6 CIT(A) ON THIS ISSUE AND RESTORE THE MATTER BACK TO THE FILE OF THE A.O. FOR A FRESH DECISION. BEFORE THE A.O., THE ASSESSEE SH OULD BRING THE EVIDENCES AND DETAILS ON RECORD REGARDING EXPENSES INCURRED AND SHOULD SHOW THAT THESE WERE INCURRED FOR THE PERFORMANCE O F DUTY AND THE ASSESSEE IS ALSO REQUIRED TO SHOW THE SOURCE OF SU CH EXPENDITURE AND IF THE ASSESSEE IS ABLE TO DO THIS, THE CLAIM OF THE A SSESSEE SHOULD BE ACCEPTED TO THE EXTENT, IT IS FOUND THAT THE EXPENS ES WERE ACTUALLY INCURRED BY THE ASSESSEE FOR THE PERFORMANCE OF DUTY AND THE SE ALLOWANCES ARE ONLY FOR THE PURPOSE OF MEETING SUCH EXPENDITURE. THE A.O. SHOULD PASS NECESSARY ORDER AS PER LAW AS PER ABOVE DISCUSSION AFTER PROVIDING ADEQUATE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE . THIS GROUND OF ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. 8. REGARDING GROUND NO.3, IT WAS SUBMITTED BY THE L D. A.R. THAT THIS ISSUE IS COVERED IN FAVOUR OF THE ASSESSEE BY THE J UDGMENT OF HONBLE GUJARAT HIGH COURT RENDERED IN THE CASE OF CIT VS K IRANBHAI H SHELAT AND ANOTHER AND CHIMANBHAI H PATEL AND OTHERS VS C IT AS REPORTED IN 234 ITR 635. LD. D.R. OF THE REVENUE SUPPORTED THE ORDERS OF AUTHORITIES BELOW. 9. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS, PERUSE D THE MATERIAL ON RECORD AND HAVE GONE THROUGH THE ORDERS OF AUTHORIT IES BELOW AND THE JUDGMENT OF HONBLE GUJARAT HIGH COURT CITED BY THE LD. A.R. OF THE ASSESSEE. WE FIND THAT IT WAS HELD BY THE AUTHOR ITIES BELOW THAT THIS CLAIM OF THE ASSESSEE IS NOT ACCEPTABLE THAT 30% OF THE TOTAL INCENTIVE BONUS OF RS.1,56,712/- AMOUNTING TO RS.47,014/- IS EXEMPT U/S10(14). IN THE CASE OF CIT VS KIRANBHAI H SHELAT AND ANOTHER ( SUPRA), IT WAS HELD BY THE HON'BLE GUJARAT HIGH COURT I.E. THE JURISDIC TIONAL HIGH COURT THAT THE DEDUCTION IS ALLOWABLE FROM INCENTIVE BONUS UP TO MAXIMUM LIMIT OF 30% OF INCENTIVE BONUS. BUT FOR ALLOWING THIS DEDU CTION ALSO, THE I.T.A.NO. 1681, 1682 /AHD/2007 7 ASSESSEE HAS TO SHOW THAT HOW MUCH EXPENDITURE WAS INCURRED BY THE ASSESSEE FOR THE PURPOSE OF PERFORMANCE OF DUTY WIT HOUT INCLUDING THE CONVEYANCE EXPENDITURE FOR WHICH SEPARATE ALLOWANCE IS ALLOWED BY THE EMPLOYER AND FOR WHICH THE ASSESSEE IS CLAIMING THA T SUCH ALLOWANCE IS EXEMPT U/S 10(14). DEDUCTION OUT OF INCENTIVE BONU S CAN BE ALLOWED ONLY IF IT IS SHOWN BY THE ASSESSEE THAT EXPENDITURE IN ADDITION TO CONVEYANCE EXPENDITURE HAD BEEN INCURRED BY THE ASSESSEE FOR T HE PERFORMANCE OF DUTY AND THE ASSESSEE IS REQUIRED TO SHOW THE SOURC E OF SUCH EXPENDITURE ALSO AND THEN ONLY IT CAN BE ACCEPTED THAT THE EXPE NDITURE INCURRED UP TO 30% OF THE INCENTIVE BONUS CAN BE ALLOWED AS DEDUCT ION AS HAD BEEN HELD BY HONBLE GUJARAT HIGH COURT IN THE CASE OF CIT VS KIRANBHAI H SHELAT (SUPRA). SINCE NEITHER ANY DETAIL OF EXPENSES INCU RRED NOR ANY EVIDENCE AND SOURCE OF SUCH EXPENDITURE HAD BEEN BROUGHT ON RECORD BY THE ASSESSEE, WE FIND THAT THIS ISSUE SHOULD ALSO GO BA CK TO THE FILE OF THE A.O. FOR A FRESH DECISION. ACCORDINGLY, WE SET ASIDE T HE ORDER OF CIT(A) ON THIS ISSUE ALSO AND RESTORE THE MATTER BACK TO THE FILE OF THE A.O. FOR A FRESH DECISION. THE ASSESSEE HAS TO BRING ON RECOR D THE DETAILS AND EVIDENCES OF EXPENSE INCURRED OUT OF INCENTIVE BONU S WITHOUT INCLUDING CONVEYANCE EXPENDITURE. THE ASSESSEE IS ALSO REQUI RED TO EXPLAIN THE SOURCE OF INCURRING SUCH EXPENDITURE. TO THE EXTEN T THE ASSESSEE IS ABLE TO ESTABLISH THE INCURRING OF EXPENDITURE ALONG WITH I TS SOURCE, DEDUCTION CAN BE ALLOWED TO THE ASSESSEE UP TO THE MAXIMUM LIMIT OF 30% OF THE INCENTIVE BONUS. THE A.O. SHOULD PASS NECESSARY OR DER AS PER LAW AS PER ABOVE DISCUSSION AFTER PROVIDING ADEQUATE OPPORTUNI TY OF BEING HEARD TO THE ASSESSEE. GROUND NO.3 OF THE ASSESSEE IS ALSO ALLOWED FOR STATISTICAL PURPOSE. I.T.A.NO. 1681, 1682 /AHD/2007 8 10. NOW, WE TAKE UP THE APPEAL OF THE ASSESSEE FOR THE ASSESSMENT YEAR 2004-05 IN I.T.A.NO. 1862/AHD/2007. THE GROUNDS OF THIS APPEAL ARE AS UNDER: YOUR APPELLANT BEING DISSATISFIED WITH THE ORDER P ASSED BY THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) VI, BA RODA DATED 26.02.207 PRESENTS THESE GROUNDS OF APPEALS AGAINST THE SAID ORDER ON THE FOLLOWING AMONGST OTHER GROUNDS :- 1. THE LEARNED CIT(A) HAS ERRED IN UPHOLDING THE AC TION OF AO OF INVOKING PROVISIONS OF SECTION 147 OF THE ACT. YOUR APPELLAN T SUBMITS THAT RE-OPENING IS BAD IN LAW AND CONTRARY TO LEGAL PRON OUNCEMENTS. LOBE HELD SO NOW AND ORDER PASSED BE CANCELLED. 2. THE LEARNED CLT(A) HAS ERRED IN HOLDING THAT ENT IRE ADDITIONAL CONVEYANCE ALLOWANCE OF RS 1,18,914 AND 50% OF CONV EYANCE ALLOWANCE OF RS 12,060 IS TAXABLE. YOUR APPELLANT S UBMITS THAT ENTIRE ADDITIONAL CONVEYANCE ALLOWANCE OF RS 1,18,9 14 AND ENTIRE CONVEYANCE ALLOWANCE BE HELD EXEMPT AND ADDITION MA DE BY THE AO BE DELETED IN TOTO. 3. THE LEARNED CIT(A) HAS ERRED IN CONFIRMING THE A DDITION OF RS 50,000 MADE BY THE AO INVOKING PROVISIONS OF SECTIO N 69 OF THE ACT. YOUR APPELLANT SUBMITS THAT ADDITION MADE BY T HE AO AND SUSTAINED BY THE CIT(A) IS UNWARRANTED AND SAME BE DELETED NOW. 4. THE LEARNED CIT(A) HAS ERRED IN CONFIRMING THE A CTION OF THE AO OF CHARGING INTEREST U/S 234B AND 234D OF THE AC T, YOUR APPELLANT SUBMITS THAT LEVY OF INTEREST BEING INCOR RECT, BE DELETED NOW. 11. IT WAS SUBMITTED BY THE LD. A.R. OF THE ASSESSE E THAT GROUND NO.1 IS NOT PRESSED AND ACCORDINGLY, GROUND NO.1 IS REJECTE D AS NOT PRESSED. 12. REGARDING GROUND NO.4, IT WAS SUBMITTED THAT TH E ISSUE REGARDING CHARGING OF INTEREST U/S 234B AND 234D IS CONSEQUEN TIAL AND WE HOLD ACCORDINGLY. I.T.A.NO. 1681, 1682 /AHD/2007 9 13. REGARDING GROUND NO.2, IT WAS SUBMITTED THAT TH IS IS IDENTICAL TO GROUND NO.2 IN ASSESSMENT YEAR 2003-04. IN ASSESSM ENT YEAR 2003-04, WE HAVE RESTORED BACK THIS MATTER TO THE FILE OF TH E A.O. FOR A FRESH DECISION AT PARA NO.7 ABOVE. ACCORDINGLY, IN THIS YEAR ALSO, THIS ISSUE IS RESTORED BACK TO THE FILE OF THE A.O. FOR A FRESH D ECISION WITH SIMILAR DIRECTION. GROUND NO.2 IS ALLOWED FOR STATISTICAL PURPOSES. 14. REGARDING GROUND NO.3, THE FACTS ARE THAT IT IS NOTED BY THE A.O. IN PARA 5 OF THE ASSESSMENT ORDER THAT THE ASSESSEE DE POSITED RS.20,000/- IN CASH IN UTI BANK ON 8.4.2003 AND ANOTHER RS.30,000/ - WAS DEPOSITED ON 21.04.2003 IN ADDITION TO OTHER SMALL DEPOSITS OF R S.9,800/-. THE A.O. HELD THAT ENTIRE CASH DEPOSIT IN THE BANK IS FROM U NDISCLOSED SOURCES AND HE MADE ADDITION OF THE ENTIRE AMOUNT OF RS.59,800/ -. BEING AGGRIEVED, ASSESSEE CARRIED THE MATTER IN APPEAL BEFORE CIT(A) WHO HAS ALLOWED RELIEF OF RS.9,800/- BUT CONFIRMED THE ADDITION OF RS.50,000/- AND NOW, THE ASSESSEE IS IN FURTHER APPEAL BEFORE US. 15. IT IS SUBMITTED BY THE LD. A.R. OF THE ASSESSEE THAT DURING THE FINANCIAL YEAR 2002-03, THE ASSESSEE HAD MADE CASH WITHDRAWAL OF RS.2.50 LACS FROM PNB AND AN AMOUNT OF RS.37,500/- ONLY WAS DEPOSITED IN PNB AND UTI DURING THAT YEAR AND HENCE, THERE WAS SURPL US CASH OF RS.2,12,500/- IN THAT YEAR OUT OF WHICH IN THE PRES ENT YEAR, THE ASSESSEE HAS DEPOSITED THESE AMOUNTS OF RS.59,800/- AND HENC E ADDITION CONFIRMED BY LD. CIT(A) SHOULD BE DELETED. LD. D.R. OF THE R EVENUE SUPPORTED THE ORDER OF AUTHORITIES BELOW. 16. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS, PERUS ED THE MATERIAL ON RECORD AND HAVE GONE THROUGH THE ORDERS OF AUTHORIT IES BELOW. WE FIND THAT THE CLAIM OF THE ASSESSEE IS THIS THAT OUT OF THE CASH WITHDRAWAL FROM PNB OF RS.2.50 LACS DURING THE FINANCIAL YEAR 2002- 03, AN AMOUNT OF RS.37,500/- WAS DEPOSITED BACK BY THE ASSESSEE IN P NB AND HENCE AN I.T.A.NO. 1681, 1682 /AHD/2007 10 AMOUNT OF RS.2,12,500/- WAS AVAILABLE WITH THE ASSE SSEE AT THE BEGINNING OF THE PRESENT YEAR IN CASH. BUT THIS SUBMISSION O F THE ASSESSEE HAS TO BE EXAMINED IN THE LIGHT OF OTHER FACTS AS TO IN ADDIT ION OF CASH DEPOSITED BACK IN THE BANK IN FINANCIAL YEAR 2002-03, HOW MUC H CASH WAS USED BY THE ASSESSEE FOR HOUSE HOLD EXPENSES AND HOW MUCH C ASH WAS USED BY THE ASSESSEE FOR INCURRING EXPENSES ON ACCOUNT OF CONVE YANCE AND ADDITIONAL CONVEYANCE AND ALSO ON ACCOUNT OF INCURRING EXPENSE S OUT OF INCENTIVE BONUS ETC. IF THE ASSESSEE CAN SHOW THAT SURPLUS C ASH WAS AVAILABLE EVEN AFTER THESE EXPENSES THEN THE SAME SHOULD BE CONSID ERED AS AVAILABLE WITH THE ASSESSEE FOR DEPOSITS IN THE BANK IN THE PRESEN T YEAR. THESE FACTS ARE NOT COMING OUT FROM THE RECORD AND HENCE, WE FEEL T HAT IN THE INTEREST OF JUSTICE, THIS MATER SHOULD GO BACK TO THE FILE OF T HE A.O. FOR FRESH DECISION. WE, THEREFORE, SET ASIDE THE ORDER OF LD . CIT(A) ON THIS ISSUE AND RESTORE THE SAME TO THE FILE OF THE A.O. FOR A FRESH DECISION. IN ADDITION TO THE DETAILS REGARDING CASH WITHDRAWAL A ND CASH DEPOSIT IN BANK IN FINANCIAL YEAR 2002-03 AND UP TO 21.4.2003 IN TH E PRESENT YEAR, THE ASSESSEE SHOULD ALSO FURNISH THE DETAILS REGARDING OTHER CASH USED ON ACCOUNT OF HOUSE HOLD EXPENSES, EXPENDITURE ON CONV EYANCE AND ADDITIONAL CONVEYANCE AND ALSO ON ACCOUNT OF EXPENS ES OUT OF INCENTIVE BONUS ETC. BECAUSE AMOUNT OF CONVEYANCE ALLOWANCE, ADDITIONAL CONVEYANCE ALLOWANCE AND INCENTIVE BONUS IS RECEIVE D BY THE ASSESSEE FROM THE EMPLOYER BY WAY OF CHEQUE AND THE SAME IS DEPOSITED IN THE BANK AND THEREFORE, ALL SUCH EXPENDITURE ARE OUT OF CASH WITHDRAWN FROM THE BANK AND HENCE, IT HAS TO BE SEEN THAT OUT OF T OTAL CASH WITHDRAWN OF RS.2.50 LACS IN FINANCIAL YEAR 2002-03, HOW MUCH CA SH WAS DEPOSITED BACK BY THE ASSESSEE IN THE BANK AND HOW MUCH OTHER USAGE OF CASH WAS THERE IN THAT YEAR AND UP TO 21.04.2003 IN THE PRES ENT YEAR AND IF SURPLUS CASH IS AVAILABLE WITH THE ASSESSEE THEN TO THAT EX TENT, IT SHOULD BE I.T.A.NO. 1681, 1682 /AHD/2007 11 ACCEPTED THAT CASH DEPOSITED IN THE BANK BY THE ASS ESSEE OF RS.20,000/- ON 08.04.2003 AND RS.30,000/- ON 21.4.2003 IS OUT OF T HE EXPLAINED SOURCES. THE A.O. SHOULD ALLOW ADEQUATE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. THIS GROUND OF THE ASSESSEE IS ALLOWED F OR STATISTICAL PURPOSES. IN THE RESULT, THIS APPEAL OF THE ASSESSEE IS PARTL Y ALLOWED. 17. IN THE COMBINED RESULT, BOTH THE APPEALS OF THE ASSESSEE ARE PARTLY ALLOWED FOR STATISTICAL PURPOSE. 18. ORDER PRONOUNCED IN THE OPEN COURT ON 23 RD SEP., 2011. SD./- SD./- (T. K. SHARMA) (A. K. GARODIA) JUDICIAL MEMBER ACCOUNTANT MEMBER AHMEDABAD; DATED : 23.09. 2011 SP COPY OF THE ORDER FORWARDED TO: 1. THE APPLICANT 2. THE RESPONDENT 3. THE CIT CONCERNED 4. THE LD. CIT (APPEALS) 5. THE DR, AHMEDABAD BY ORDER 6. THE GUARD FILE AR, ITAT, AHMEDABAD 1. DATE OF DICTATION 19/9 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER 20/9 OTHER MEMBER 3. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR. P .S./P.S. 22/9 4. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE D ICTATING MEMBER FOR PRONOUNCEMENT 23/9/11 5. DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR. P.S./P.S.23/9 6. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 23/09/2011 7. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK .. 8. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT RE GISTRAR FOR SIGNATURE ON THE ORDER . 9. DATE OF DESPATCH OF THE ORDER.