K.Krishnaraj, Pollachi V. ITO, Pollachi

ITA 1943/CHNY/2015

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 8489 (ITAT-CHENNAI)
• Duration Of Justice: 1 year(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-09-2016
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: B
• Next Hearing Date: 13-07-2016
• Assessment Year: 2009-2010
• Appeal Filed On: 07-09-2015
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: SUPRIYO PAL
• Assessee Lawyers: K MEENAKSHISUNDARAM ITP
• Keywords: Unexplained investment; Gift; Opportunity of being heard
• Section: 143(3); 69

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL , B B ENCH, CHENNAI . , ' # . $ , & ' BEFORE SHRI A.MOHAN ALANKAMONY, ACCOUNTANT MEMBER AND SHRI DUVVURU RL REDDY, JUDICI AL MEMBER ./ I.T.A.NO.1943/MDS/2015 ( / ASSESSMENT YEAR: 2009-10) MR. K.KRISHNARAJ 120, POLLACHI MAIN ROAD, KINATHUKADAVU, POLLACHI. VS THE INCOME TAX OFFICER, WARD-I(2),POLLACHI. PAN: AYAPK5947J ( /APPELLANT) ( /RESPONDENT) / APPELLANT BY : MR.K.MEENAKSHISUNDARAM, ITP /RESPONDENT BY : MR. SUPRIYO PAL, JCIT /DATE OF HEARING : 13 TH JULY, 2016 /DATE OF PRONOUNCEMENT : 16 TH SEPTEMBER, 2016 / O R D E R PER A. MOHAN ALANKAMONY, AM:- THIS APPEAL IS FILED BY THE ASSESSEE AGGRIEVED BY T HE ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX (AP PEALS)- 3, COIMBATORE DATED 30.06.2015 IN ITA NO.198/15-16 PASSED UNDER SECTION 143(3) R.W.S. 250(6) OF THE ACT. 2. THE ASSESSEE HAS RAISED SEVERAL GROUNDS IN ITS A PPEAL, HOWEVER, THE CRUX OF THE ISSUE IS AS FOLLOWS:- THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED IN SUSTAINING THE ADDITION OF ` 20.00 LAKHS MADE BY THE LEARNED ASSESSING OFFICER UNDER SECTION 69 OF THE ACT AS UNEXPLAINED INVESTMENT. 2 ITA NO.1943/MDS/2015 3. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE IS AN INDIVIDUAL ENGAGED IN THE BUSINESS OF TRADING IN CO CONUT FILED HIS RETURN OF INCOME FOR THE ASSESSMENT YEAR 2009-1 0 ON 14.07.2010 ADMITTING INCOME OF ` 1,51,050/- . THIS IS A SECOND ROUND OF LITIGATION. EARLIER THIS TRIBUNAL VIDE ORD ER DATED 13.04.2015 IN ITA NO.1020/MDS/2014 REMITTED THE ISS UE BACK TO THE FILE OF THE LEARNED COMMISSIONER OF INCOME T AX (APPEALS) TO PROVIDE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE AND PASS APPROPRIATE ORDERS ON MERITS & L AW. IN THE FIRST INSTANCE THE CASE WAS TAKEN UP FOR SC RUTINY UNDER CASS AND NOTICE UNDER SECTION 143(2) WAS ISSUED TO THE ASSESSEE ON 30.08.2010. THEREAFTER THE ASSESSMENT WAS COMPLETED UNDER SECTION 143(3) OF THE ACT ON 30.12. 2011 WHEREIN THE LEARNED ASSESSING OFFICER HAD MADE ADDI TION OF ` 20,00,000/- TOWARDS UNEXPLAINED CASH DEPOSIT IN THE S.B.ACCOUNT NO.589781 OF THE ASSESSEE MAINTAINED WI TH CITY UNION BANK, POLLACHI ON 12.03.2009 BY INVOKING THE PROVISIONS OF SECTION 69 OF THE ACT. ON APPEAL, THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) SUSTAINED THE 3 ITA NO.1943/MDS/2015 ADDITION MADE BY THE LEARNED ASSESSING OFFICER BY A GREEING WITH HIS VIEW. 5. DURING THE COURSE OF ASSESSMENT PROCEEDINGS IT W AS OBSERVED BY THE LEARNED ASSESSING OFFICER THAT THE ASSESSEE HAD NOT MAINTAINED ANY BOOKS OF ACCOUNTS FOR HIS BU SINESS BUT HAS ESTIMATED HIS INCOME @ 5% ON THE TURNOVER. FURTHER, IT WAS OBSERVED THAT THE ASSESSEE HAD MADE CASH DEP OSIT OF RS.20.00 LAKHS ON 12.03.2009. THE ASSESSEE COULD NO T EXPLAIN THE TRANSACTION OF CASH DEPOSIT MADE BY HIM IN THE BANK ACCOUNT. THEREFORE, THE LEARNED ASSESSING OFFI CER INVOKED THE PROVISIONS OF SECTION 69 OF THE ACT AND MADE ADDITION OF RS.20.00 LAKHS IN THE HANDS OF THE ASSE SSEE. BEFORE THE LEARNED COMMISSIONER OF INCOME TAX (APPE ALS) IN THE SECOND INNINGS THE ASSESSEE HAD CLAIMED THAT RS .14.00 LAKHS WAS FROM HIS OWN SOURCE AND RS.6.00 LAKHS WAS BY WAY OF GIFT OBTAINED FROM HIS RELATIVES. HOWEVER, T HE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) CONFIRMED THE ORDER OF THE LEARNED ASSESSING OFFICER BY STATING THAT TH E SOURCE OF RS.20.00 LAKHS WAS NOT SATISFACTORILY EXPLAINED. 4 ITA NO.1943/MDS/2015 6. BEFORE US, THE LEARNED AUTHORIZED REPRESENTATIVE SUBMITTED THAT THE ASSESSEE IS A BUSINESSMAN AND WA S FILING HIS RETURN OF INCOME REGULARLY. HE FURTHER SUBMITTE D THAT THE SOURCE OF DEPOSIT IN THE BANK ACCOUNT OF THE ASSESS EE IS FROM HIS OWN SOURCE AND ACCUMULATED GIFT RECEIVED FROM H IS RELATIVES. IT WAS THEREFORE PLEADED THAT THE ADDITI ON OF RS.20.00 LAKHS IN THE HANDS OF THE ASSESSEE MAY BE DELETED. 7. THE LEARNED DEPARTMENTAL REPRESENTATIVE ON THE O THER HAND RELIED ON THE ORDERS OF THE REVENUE. 8. WE HAVE HEARD THE RIVAL SUBMISSIONS AND CAREFULL Y PERUSED THE MATERIALS AVAILABLE ON RECORD. FROM THE FACTS OF THE CASE, IT IS EVIDENT THAT THE ASSESSEE COULD NOT SATISFACTORILY EXPLAIN THE SOURCE OF DEPOSIT OF RS. 20.00 LAKHS MADE BY HIM IN HIS BANK ACCOUNT. HOWEVER, CONSIDERI NG THE FINANCIAL STATUS OF THE ASSESSEE AND THE NATURE OF BUSINESS CARRIED ON BY THE ASSESSEE WHEREIN CASH TRADING IS INEVITABLE AS THE BUSINESS PERTAINS TO AGRICULTURAL PRODUCE, W E ARE OF THE 5 ITA NO.1943/MDS/2015 CONSIDERED VIEW THAT IT CAN BE SAFELY PRESUMED THAT THE ASSESSEE WOULD HAVE GENUINE INTERNAL OWN SOURCE OF RS.10.00 LAKHS FOR MAKING THE DEPOSIT IN THE BANK A CCOUNT. THEREFORE, IN THE INTEREST OF JUSTICE, WE HEREBY DI RECT THE LEARNED ASSESSING OFFICER TO DELETE THE ADDITION OF RS.10,00,000/- OUT OF THE ADDITION MADE FOR RS.20,0 0,000/-, THEREBY ONLY ADDITION OF RS.10.00 LAKHS IS SUSTAINE D. 9. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS PAR TLY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON THE 16 TH SEPTEMBER, 2016 SD/- SD/- ( ' # . $ ) ( . ) ( DUVVURU RL REDDY ) ( A. MOHAN ALANKAMONY ) # % / JUDICIAL MEMBER % / ACCOUNTANT MEMBER # /CHENNAI, ( /DATED 16 TH SEPTEMBER, 2016 SOMU *+ ,+ /COPY TO: 1. APPELLANT 2. RESPONDENT 3. - () /CIT(A) 4. - /CIT 5. + 1 /DR 6. /GF