Santanu Som, Kolkata V. I.T.O Wd - 12(4),kolkata, Darjeeling

ITA 1978/KOL/2013

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 100164 (ITAT-KOLKATA)
• Duration Of Justice: 2 year(s) 5 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-12-2015
• Appeal Filed By: Assessee
• Bench Allotted: A
• Assessment Year: 2004-2005
• Appeal Filed On: 20-06-2013
• Court: TRIBUNAL
• Assessee Lawyers: S K DASGUPTA
• Keywords: Gift; Business expenditure
• Section: 143(3); 147

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH: KOLKATA [BEFORE SHRI MAHAVIR SINGH, JM] I.T.A NOS.1978 & 1979/KOL/2013 ASSESSMENT YEARS: 2004-05 & 2005-06 SANTANU SOM VS. INCOME-TAX OFFICER, WD-12(4), KOLKATA (PAN: ALXPS9636E) ( APPELLANT ) ( RESPONDENT ) DATE OF HEARING: 09.12.2015 DATE OF PRONOUNCEMENT: 16.12.2015 FOR THE APPELLANT: SHRI S. K. DASGUPTA FOR THE RESPONDENT: SHRI RAJENDRA PRASAD, JCIT, SR. DR BOTH THESE APPEALS BY ASSESSEE ARE ARISING OUT OF S EPARATE ORDERS OF CIT(A)-XII, KOLKATA IN APPEAL NOS.26 & 275/CIT(A)-XII/12(4)/08-09 DATED 22.03.2013. ASSESSMENTS WERE FRAMED BY ITO, WARD-12(4), KOLKATA, U/S. 147 R.W.S. 143(3) OF THE INCOME-TAX ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT) FOR AYS 2004-05 & 2005-06 VIDE ITS ORDER DATED 08.12.2008. 2. THE FIRST COMMON ISSUE IN THESE TWO APPEALS OF A SSESSEE IS AGAINST THE ORDER OF CIT(A) CONFIRMING THE ADDITION OF CASH CREDIT DEPOSITED IN UNDISCLOSED BANK ACCOUNT AMOUNTING TO RS.2,96,721/- IN AY 2004-05 AND RS.1,00,161/- IN AY 2005-06. FOR THIS, ASSESSEE HAS RAISED IDENTICALLY WORDED GROUND AND THE GROUND NO.2 AS RA ISED IN AY 2004-05 READS AS UNDER: 2. FOR THAT THE ADDITIONS AGAINST CREDITS IN THE ALLEGED UNDISCLOSED BANK ACCOUNT AMOUNTING TO RS.2,96,721/- (FOR AY 2004-05) AND RS. 1,00,161/- (FOR AY 2005-06) WAS THE RESULT OF PRE-CONCEIVED MIND OF THE ASSESSING OFFIC ER AND THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS)-XII, KOLKATA, COUPLED WITH NOT UNDERSTANDING INTENTIONALLY THE NATURE OF CREDITS IN THE BANK STATEMENTS EVEN AFTER EXPLAI NING THE SAME AND SOURCES OF RECEIPTS. HENCE THE ASSESSMENT MADE THUS PROVES ARBITRARY IN NATURE AND BAD IN LAW WHICH LEADS TO DELETION ALTOGETHER. SINCE FACTS AND CIRCUMSTANCES ARE EXACTLY IDENTICAL IN BOTH THE YEARS, I WILL TAKE THE FACT FROM AY 2004-05 AND DECIDE THE ISSUE. 3. BRIEFLY STATED FACTS ARE THAT THE AO NOTICED FRO M THE ASSESSEES SAVINGS BANK ACCOUNT NO. 034010100010316 MAINTAINED WITH AXIS BANK, BEHALA B RANCH THAT THERE IS TOTAL AMOUNT CREDITED DURING THE YEAR UNDER CONSIDERATION AT RS.2,96,721/ -. THE ASSESSEE CLAIMED THAT THE DEPOSITS WERE RELATED TO REIMBURSEMENT OF MEDICLAIM, AMOUNT RECEI VED FROM FATHER FROM TIME TO TIME DEPOSITED WITH THE BANK, THE CREDIT OF SALARY CHEQUES AND MAT URITY OF FIXED DEPOSITS AND ALSO MATURITY OF KVP. ACCORDING TO ASSESSEE, THESE ARE NOT UNEXPLAI NED AMOUNT, HENCE THE SAME SHOULD NOT BE ADDED BUT THE AO WAS NOT CONVINCED WITH THE EXPLAN ATION OF THE ASSESSEE AND HE MADE ADDITION OF AMOUNTS OF RS.2,96,721/-. AGGRIEVED, ASSESSEE P REFERRED APPEAL BEFORE CIT(A) WHO ALSO CONFIRMED THE ACTION OF AO. AGGRIEVED, ASSESSEE IS IN SECOND APPEAL BEFORE ITAT. 2 ITA NO.1978 & 1979/K/2013 SANTANU SOM, AYS 2004-05 & 2005-06 4. I HAVE HEARD RIVAL SUBMISSIONS AND GONE THROUGH FACTS AND CIRCUMSTANCES OF THE CASE. I FIND FROM THE DETAILS FILED BEFORE ME, WHICH WERE A LSO FILED BEFORE AO AS WELL AS BEFORE CIT(A) THAT THESE AMOUNTS ARE RECEIPTS OF SAVINGS, SMALL G IFTS, SALARY DEPOSIT, KVP MATURITY ETC. THE DETAILS ARE AS UNDER: SL. NO. NATURE OF DEPOSITS (AY 2004- 05) AMOUNT (RS.) 1. 2. 3. 4. 5. 6. 7. 8. 9. GIFTS RECEIVED FROM FATHER MR. GOURI SHANKAR SOM, W HICH WAS DEPOSITED WITH THE BANK . GIFTS RECEIVED FROM MOTHER MRS. SHAFALI SHANKAR SOM , WHICH WERE DEPOSITED WITH THE BANK. GIFTS RECEIVED FROM WIFE MRS. MOUHA SOM, WHICH WERE DEPOSITED WITH THE BANK. SURPLUS DEPOSITED OUT OF WITHDRAWAL THROUGH (ATM) O F SAME A/C. REIMBURSEMENT OF MEDICAL EXPENSES GIFTS RECEIVED FROM FRIENDS FD MATURITY VALUE (PRINCIPAL AMOUNT PLUS INTEREST) SALARY DEPOSITED BANK INTEREST CREDITED 21,250/- 17,750/- 300/- 5,000/- 1,15,000/- 768/- 84,493/- 52,000/- 160/- ________ 2,96,721/- SL. NO. NATURE OF DEPOSITS (AY 2005- 06) AMOUNT (RS.) 1. 2. 3. 4. 5. GIFTS RECEIVED FROM MOTHER MRS. SHAFALI SHANKAR SOM , WHICH WERE DEPOSITED WITH THE BANK. GIFTS RECEIVED FROM FRIENDS KVP MATURITY VALUE (PRINCIPAL AMOUNT PLUS INTEREST) SALARY DEPOSITED BANK INTEREST CREDITED 6,000/- 3,358/- 60,699/- 30,000/- 104/- _________ 1,00,161/- 5. THE ASSESSEE HAS FILED COMPLETE DETAILS AND EVID ENCES IN RESPECT TO THESE AMOUNTS BEFORE ME WHICH ARE ENCLOSED IN ASSESSEES PAPER BOOK. WH EN THESE EVIDENCES WERE CONFRONTED TO LD. SR. DR, HE ONLY REQUESTED FOR SETTING ASIDE THIS IS SUE TO THE FILE OF THE AO BUT COULD NOT CONTROVERT THE EVIDENCES. I FIND FROM THE FACTS AND CIRCUMSTANCES OF THE CASE THAT THESE ARE 3 ITA NO.1978 & 1979/K/2013 SANTANU SOM, AYS 2004-05 & 2005-06 EXPLAINED AMOUNTS AND IN NO WAY THIS CAN BE TREATED AS UNEXPLAINED. ACCORDINGLY, IN BOTH THE YEARS I DELETE THE ADDITION AND ALLOW THIS COMMON I SSUE OF ASSESSEES APPEALS. 6. THE NEXT COMMON ISSUE IN THESE TWO APPEALS OF AS SESSEE IS AGAINST THE ORDER OF CIT(A) CONFIRMING THE ADDITION MADE BY AO ON ACCOUNT OF WI THDRAWAL FOR EXPENDITURE FROM CASH CREDIT ACCOUNT MAINTAINED WITH BANK OF MAHARASTRA AMOUNTIN G TO RS.8,20,692/- FOR AY 2004-05 AND RS.6,05,975/- FOR AY 2005-06. FOR THIS, ASSESSEE H AS RAISED IDENTICALLY WORDED GROUND AND THE GROUND NO.3 AS RAISED IN AY 2004-05 READS AS UNDER: 3. FOR THAT THE WITHDRAWALS AGGREGATING RS.8,20,6 92/-, (FOR AY 2004-05) AND RS.6,05,975/- (FOR AY 2005-06), FOR BUSINESS EXPENDITURE FROM CAS H CREDIT ACCOUNT WITH BANK OF MAHARASHTRA, RASH BEHARI AVENUE BRANCH WITH BANK DR AFTS WERE MADE TOWARDS THE PAYMENT FOR THE AFORESAID BUSINESS EXPENDITURE IS A LTOGETHER ARBITRARY, ILLEGAL AND WITHOUT ASSIGNING ANY VALID REASONS INSPITE OF PRODUCING TH E BOOKS OF ACCOUNT OF THE COMPANY AND ALSO IGNORING THE COPIES OF THE BANK DRAFTS PRODUCE D AND AUDITED ACCOUNTS. SINCE FACTS AND CIRCUMSTANCES ARE EXACTLY IDENTICAL IN BOTH THE YEARS, I WILL TAKE THE FACT FROM AY 2004-05 AND DECIDE THE ISSUE. 7. BRIEFLY STATED FACTS ARE THAT THE AO NOTICED FRO M THE WITHDRAWALS MADE FROM BANK OF MAHARASTRA, RASH BEHARI AVENUE BRANCH OF SOMNET DYN AGRAPHICS PVT. LTD., THAT THE ASSESSEE BEING A DIRECTOR HAS MADE VARIOUS WITHDRAWALS AND A CCORDING TO AO, THESE ARE FOR PERSONAL BENEFIT OF THE ASSESSEE BUT NOT FOR THE EXPENDITURE OF THE ASSESSEE COMPANY. BEFORE CIT(A), THE ASSESSEE FILED THE SAME DETAILS WHICH WERE FILED BE FORE AO AND CIT(A) AFTER SEEKING REMAND REPORT FROM THE AO, DISMISSED THE GROUND RAISED BY ASSESSEE BY OBSERVING AS UNDER: I HAVE CONSIDERED THE FINDING OF THE AO IN THE AS SESSMENT ORDER AND THE REMAND REPORT AND SUBMISSION FILED BY THE A.R DURING THE APPELLAT E PROCEEDING. I FIND THAT THE A.R/ASSESSEE HAS FAILED TO PRODUCE DETAILS/DOCUMENT S REGARDING EXPENSES CLAIMED BEFORE THE AO BOTH IN ASSESSMENT PROCEEDING AND IN REMAND PROCEEDING. THEREFORE, ASSESSEES CLAIM ON THIS ISSUE HAS NO EVIDENCE. ACCORDINGLY, ASSESSEES APPEAL ON GROUND NO.3 IS DISMISSED. 8. I FIND FROM THE DETAILS FILED BEFORE ME REGARDIN G EXPENSES CLAIMED BY THE ASSESSEE AFTER MAKING WITHDRAWAL FROM THE BANK ACCOUNT OF BANK OF MAHARASTRA, RASH BEHARI AVENUE BRANCH OF SOMNET DYNAGRAPHICS PVT. LTD., AND THESE WITHDRA WALS WERE ACTUALLY MADE FOR THE EXPENSES OF THE SAID COMPANY. THE DETAILS FILED BY ASSESSEE (F OR AY 2004-05 IN ITA NO. 1978/K/2013) ARE, (I) AMOUNTS WITHDRAWN FOR MAKING DEMAND DRAFTS IN F AVOUR OF VIJEX ENTERPRISES, NEW DELHI FOR TONNER AND OTHER SPARES OF XEROX MACHINES ON STATED DATES RS.3,31,800/-, II) AMOUNTS WITHDRAWN FOR MAKING DEMAND DRAFTS IN FAVOUR OF J. M. ENTERPR ISES, NEW DELHI FOR TONNER AND OTHER SPARES OF XEROX MACHINES ON STATED DATES RS.24,905/-, (III ) A/C. TRAVELLING, BOARDING, LODGING AND BUSINESS PROMOTION ON VARIOUS DATES BY WAY OF PAYME NT OF CREDIT CARDS OF DIRECTORS AND MARKETING EXPENSES RS.60,000/-, (IV) A/C. PARTLY FO R CONSUMABLE PURCHASE AND PARTLY FOR OFFICE 4 ITA NO.1978 & 1979/K/2013 SANTANU SOM, AYS 2004-05 & 2005-06 EXPENSES RS.1,550/-, (V) A/C. CONSUMABLE PURCHASES RS.24,890/-, (VI) A/C. OFFICE EXPENSES RS.2,000/-, (VII) AMOUNTS WITHDRAWN FOR MAKING DEMA ND DRAFT IN FAVOUR OF TANEJA TONERS (P) LTD. NEW DELHI FOR SUPPLY OF TONER RS.800/-, (VIII) AMOUNTS WITHDRAWN FOR MAKING DEMAND DRAFT IN FAVOUR OF MIG ENGINEERS PVT. LTD., NEW DELHI FOR SUPPLY OF TONER RS.39,308/-, (IX) ) AMOUNTS WITHDRAWN FOR MAKING DEMAND DRAFT IN FAVOUR OF TANE JA PHOTOSTATE HOUSE, NEW DELHI FOR SUPPLY OF TONER RS.630/-, (X) AMOUNTS WITHDRAWN FOR MAKING DEMAND DRAFT IN FAVOUR OF KAILASH VIRMANI, NEW DELHI FOR SUPPLY OF TONER RS.1,88,420/-, (XI) C HEQUE ISSUED IN FAVOUR OF ORIENTAL ENTERPRISES RS. 7,500/-, (XII) CASH WITHDRAWAL FOR VARIOUS DATES AND PRINTING & STATIONERY CHARGES RS.1,05,550/-, (XIII) SERVICE TAX WITH INTEREST RS. 30,174/- AND (XIV) BANK CHARGES RS. 3,165/- TOTALING TO RS.8,20,692/-. THE ASSESSEE HAS FILED COMPLETE EVIDENCES INCLUDING BILLS AND VOUCHERS AND BANK STATEMENT FOR THESE EXPENSES CORRELATING W ITH THE WITHDRAWALS. ACCORDINGLY, I AM OF THE VIEW THAT THESE ARE ALLOWABLE EXPENSES IN THE C ASE OF THE COMPANY AND IN ANY WAY, IT CANNOT BE ATTRIBUTED TO BE THE INCOME OF THE ASSESSEE AS A SSESSEE HAS SPENT THESE AMOUNTS ONLY ON BEHALF OF COMPANY. ACCORDINGLY, I DELETE THE ADDITION AND ALLOW THIS ISSUE OF ASSESSEES APPEAL. SIMILAR ARE THE FACTS IN AY 2005-06, HENCE TAKING A CONSISTENT VIEW, I DELETE THE ADDITION IN THIS YEAR ALSO. 9. IN THE RESULT, BOTH THE APPEALS OF ASSESSEE ARE ALLOWED. 10. ORDER IS PRONOUNCED IN THE OPEN COURT ON 16.12 .2015 SD/- (MAHAVIR SINGH) JUDICIAL MEMBER DATED : 16 TH DECEMBER, 2015 JD. SR. P.S COPY OF THE ORDER FORWARDED TO: 1 . APPELLANT SHRI SANTANU SOM, C/O, M/S. SOMNETDYNAG RAPHICS (P) LTD., B- 9A & 9B, IE BUILDING, WEBEL ELECTRONIC COMPLEX, P-1 , TARATALA ROAD, KOLKATA-700 088. . 2 RESPONDENT ITO, WARD-12(4), KOLKATA. 3 . THE CIT(A), KOLKATA 4. 5. CIT KOLKATA DR, KOLKATA BENCHES, KOLKATA / TRUE COPY, BY ORDER, ASSTT. REGISTRAR .