Sri K Surender Reddy, Hyderabad V. DCIT., Central Circle-6, Hyderabad, Hyderabad

ITA 1871/HYD/2014

• Counselvise Citation: [2017] 130 COUNSELVISE.COM (IT) 6231 (ITAT-HYDERABAD)
• Duration Of Justice: 2 year(s) 1 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-01-2017
• Appeal Filed By: Assessee
• Bench Allotted: A
• Next Hearing Date: 23-11-2016
• Assessment Year: 2008-2009
• Appeal Filed On: 10-12-2014
• Court: TRIBUNAL
• Keywords: Unexplained cash credit; Search and seizure; Salary income; Corroborative evidences; Condonation of delay; Revised return
• Section: 68; 132

Judgement Text

THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH SMC, HYDERABAD BEFORE SHRI B. RAMAKOTAIAH, ACCOUNTANT MEMBER ITA NO. 1871/HYD/2014 ASSESSMENT YEAR: 2008-09 SHRI K. SURENDER REDDY. HYDERBAD. PAN AENPK9940G VS. DCIT, CENTRAL CIRCLE-6 HYDERBAD. (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI A. SRINIVAS REVENUE B BY : SMT. SUMAN MALIK DATE OF HEARING : 23-01-2016 DATE OF PRONOUNCEMENT : 27-01-2017 ORDER THIS IS AN APPEAL BY ASSESSEE AGAINST THE ORDER OF THE CIT(5)-I, HYDERABAD, DATED 30-09-2014. THE APPEAL WAS FILED WITH A DELAY OF ONE DAY. ASSESSEE FILED AN AFFIDAVIT SEEKING CONDONATION OF DELAY STATING THAT THEY HAVE WRONGLY CALCULATED THE 60 DAYS OVERLOOKING THE FACT THAT OCTOBER HAD 31 DAYS. THIS RESULTED IN BEING FILED A PPEAL WITH A DELAY OF ONE DAY. CONSIDERING THE FACTS OF THE CASE AND PRAYER MADE, THE DELAY OF ONE DAY IS CONDONED A ND APPEAL IS ADMITTED. 2. BRIEF FACTS OF THE CASE ARE THAT ASSESSEE IS AN INDIVIDUAL AND HAVING INCOME FROM SALARY AND INCOME FROM HOUSE PROPERTY. THERE WAS A SEARCH AND SEIZURE OPE RATION U/S 132 OF THE IT ACT ON 19-02-2008. ASSESSEE FILE D RETURN OF INCOME ADMITTING AN INCOME OF RS. 1,96,310/- AND REVISED RETURN OF INCOME ON 15-07-2009 ADMITTING IN COME OF RS 12,69,560/-. THE AO MADE FOUR ADDITIONS OUT O F 2 ITA NO. 1871/HYD/2014 SRI K. SURENDER REDDY, HYDERABAD. WHICH LD. CIT(A) GAVE RELIEF WITH REFERENCE TO WORK ING OF CAPITAL GAINS. THE ADDITIONS TOWARDS CASH CREDITS U/S 68 OF THE ACT AMOUNTING TO RS. 8,80,500/-, DISALLOWANCE O F LOAN INTEREST OF RS. 75,042 AND CASH SEIZED AT RESIDENTI AL PREMISES OF RS. 3,06,390/-, ADDED BY THE A.O, WERE CONFIRMED BY THE CIT(A), HENCE, THE PRESENT APPEAL. IN THE APPEAL THE ASSESSEE HAS RAISED EIGHT GROUNDS OUT OF WHICH GROUND NO. 1 AND 8 ARE GENERAL IN NATURE. 3. NEITHER PARTY HAS FILED ANY PAPER BOOK AND THE C ASE WAS POSTED NUMBER OF TIMES. THE LD.COUNSEL FAIRLY ADMITTED THAT INFORMATION WITH REFERENCE TO VARIOUS ADDITIONS MADE COULDNOT BE FILED AT THE TIME OF EIT HER ASSESSMENT OR BEFORE THE APPELLATE AUTHORITY. THE GROUNDS IN THIS APPEAL ARE DISPOSED-OFF, AFTER CONSIDERING THE RIVAL CONTENTIONS. 4. THE GROUNDS 2 AND 3 PERTAIN TO ISSUE OF ADDITION U/S 68. THE A.O NOTICED THAT THE ASSESSEE HAS SHOWN RE CEIPT OF LOANS FROM THE FOLLOWING PERSONS: 1. SHRI K. SRINIVASA REDDY - RS.4,40,000/- 2. SHRI G. MADHAV REDDY - RS.4,40,500/- TOTAL - RS.8,80,500/- 5. WHEN ENQUIRED, ASSESSEE SUBMITTED THAT THE LOANS ARE TAKEN FROM THE ABOVE PARTIES BY WAY OF CHEQUE AND A LL THE PERSONS ARE AGRICULTURISTS AND ARE NOT ASSESSED TO TAX. ASSESSEE FILED CONFIRMATIONS FROM THE RESPECTIVE PA RTIES WITH RESPECT TO THE ABOVE LOANS. HOWEVER, ASSESSIN G OFFICER DOUBTING THE CAPACITY OF THE PARTIES TO GIV E THE 3 ITA NO. 1871/HYD/2014 SRI K. SURENDER REDDY, HYDERABAD. LOANS, AS NO EVIDENCE HAS FURNISHED IN THAT REGARD, BROUGHT THE AMOUNT OF RS. 8,80,500/- AS UNEXPLAINED CASH CREDIT U/S 68 OF THE IT ACT. THE LD. CIT(A) HAS CO NFIRMED THE ADDITION BY STATING AS UNDER: 07.1. IT MAY BE NOTED THAT MERE FILING OF CONFIRMATION LETTERS DO NOT DISCHARGE THE ONUS THAT LIES ON THE APPELLANT, BUT THE APPELLANT IS REQUIRED TO EST ABLISH THE IDENTITY OF THE PARTY, CAPACITY OF THE PARTY TO PAR TY TO ADVANCE THE MONEY AND THE GENUINENESS OF THE TRANSA CTION. IN THE INSTANT CASE, EVEN THOUGH THE APPELLANT HAS FILED CONFIRMATIONS, NO SUPPORTING DOCUMENTS IN RESPECT O F THE LOANS ACCEPTED BY HIM WERE FILED EITHER DURING THE ASSESSMENT STAGE OR BEFORE ME. THE CLAIM THAT THE LOANS CREDITORS WERE AGRICULTURIST, NOT ASSESSED TO TAX A ND PAID BY CHEQUE DOES NOT ABSOLVE THE APPELLANT FROM ESTAB LISHING CUMULATIVELY THE 3 PILLARS OF CASH CREDITS NAMELY, IDENTITY, CREDITWORTHINESS OF THE CREDITORS AND THE GENUINENE SS OF TRANSACTIONS. SINCE THE APPELLANT FAILED TO SUBSTA NTIATE HIS CLAIM WITH ANY SATISFACTORY EXPLANATION AND EVIDENC ES, I AM CONSTRAINED TO CONFIRM THE ADDITION MADE BY THE ASSESSING OFFICER UNDER SECTION. 68 OF THE ACT AMOU NTING TO RS. 8,80,500/-. 6. THE LD. COUNSEL, EXCEPT STATING THAT THE AO HAS DISALLOWED BY NOT CONSIDERING THE CONFIRMATION LETT ERS FILED AND DEPARTMENT DID NOT ENQUIRE ABOUT THE CAPACITY O F PERSONS, HOWEVER, STATED THAT IN VIEW OF THE LAPSE OF TIME HE IS NOT IN A POSITION TO FURNISH ANY MORE EVIDENC E. IN THE ABSENCE OF ANY EVIDENCE ON RECORD, I AM UNABLE TO D IFFER FROM THE FINDINGS. I UPHOLD THE ORDERS OF REVENUE AUTHORITIES ON THIS ISSUE AND REJECT GROUND NOS. 2 & 3. 7. GROUND NOS. 4 & 5 PERTAIN TO CLAIM OF INTEREST O N HOUSING LOAN. THE ASSESSEE HAS CLAIMED AN AMOUNT OF RS. 75,042/- AS INTEREST AGAINST THE RENTAL INCOME. AS ASSESSEE COULD NOT FURNISH CERTIFICATE FROM BANK RE GARDING 4 ITA NO. 1871/HYD/2014 SRI K. SURENDER REDDY, HYDERABAD. THE PAYMENT OF INTEREST, THE SAME WAS DISALLOWED BY THE ASSESSING OFFICER. THE LD. CIT(A) ALSO NOTICING TH AT NO EVIDENCE FILED IN SUPPORT OF THE CLAIM, CONFIRMED T HE SAME. 7.1 LD. COUNSEL SUBMITTED THAT EVEN THOUGH THE AMOU NT WAS PAID TO BANK BY WAY OF CHEQUE, ASSESSEE COULD N OT FURNISH ANY EVIDENCE BEFORE THE AUTHORITIES. IN TH E ABSENCE OF SUPPORTING EVIDENCE CLAIMING THE INTEREST ON HOU SING LOAN, IT IS NOT POSSIBLE TO ALLOW THE SAME. AS ASS ESSEE COULD NOT SUBSTANTIATE THE CLAIM, THE SAME STANDS DISALLOWED. THE ORDERS OF AUTHORITIES ARE ACCORD INGLY CONFIRMED AND GROUNDS RAISED BY THE ASSESSEE ON THI S ISSUE ARE REJECTED. 8. GROUND NO. 6 & 7 PERTAIN TO THE ADDITION OF CASH FOUND FROM THE RESIDENTIAL PREMISES AMOUNTING OF RS . 3,06,900/-. DURING THE COURSE OF SEARCH ON 01-02-2 008, CASH OF RS. 3,06,900/- WAS FOUND. ON THE DAY OF SEA RCH, THE ASSESSEE CLAIMED THAT THE CASH BELONGS TO M/S JANAPRIYA GROUP OF COMPANIES. IT WAS FURTHER SUBMI TTED THAT THE CASH WAS BROUGHT BY THE ASSISTANT FROM THE HEAD OFFICE AT HIMAYATH NAGAR. AS VERIFIED THE HEAD OFF ICE HAS NOT UPDATED THE ACCOUNTS ON THE DAY OF SEARCH AND N O EVIDENCE WAS FOUND, WHEN THE CASH WAS RECEIVED FROM HEAD OFFICE. ASSESSEE ADMITTED THE CASH FOUND AS INCOME PERTAINING TO ASSESSMENT YEAR 2008-09 IN THE COURSE OF SEARCH. HOWEVER, THE SAME WAS NOT ADMITTED IN THE RETURN OF INCOME. IN THE ABSENCE OF ANY EXPLANATION ABOUT THE UNEXPLAINED MONEY FOUND ON THE DAY OF SEARCH, THE A O ADDED THE SAME TO THE INCOME OF THE ASSESSEE. NEIT HER BEFORE THE LD. CIT(A) NOR BEFORE THIS FORUM, ASSESS EE FILED 5 ITA NO. 1871/HYD/2014 SRI K. SURENDER REDDY, HYDERABAD. ANY EXPLANATION WITH REFERENCE TO THE CASH FOUND IN THE COURSE OF SEARCH, ACCORDINGLY THE FINDINGS OF THE ASSESSING OFFICER AND CIT(A) ON THIS ISSUE ARE TO BE CONFIRME D. AS THERE IS NO MERIT IN THE ASSESSEE GROUNDS RAISED, W ITHOUT THERE BEING ANY EXPLANATION FOR THE SOURCES THEREOF , THE GROUNDS ARE ACCORDINGLY REJECTED. 9. IN THE RESULT, APPEAL FILED BY THE ASSESSEE IS DISMISSED. PRONOUNCED IN THE OPEN COURT ON 27 TH JANUARY, 2017. SD/ - (B. RAMAKOTAIAH ) ACCOUNTANT MEMBER HYDERABAD, DATED: 27 TH JANUARY, 2017 KRK 1) SHRI K. SURENDER REDDY, 8-2-120/86, PLOT NO. 11 & 12 KEERTHI AND PRIDE TOWERS, ROAD NO.2, BANJARA HILLS HYDERABAD-34 2) DCIT-CENTRAL CIRCLE 3) CIT(A) -I, HYDERABAD 4) ACIT, CENTRAL RANCE-1, HYDERABAD 5) THE DEPARTMENTAL REPRESENTATIVE, I.T.A.T., H YDERABAD. 6) GUARD FILE