The ACIT, Circle-11, Ahmedabad V. Shri Balkrishna P.Patel, Ahmedabad

ITA 2012/AHD/2011

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 85668 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 6 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-02-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 16-02-2015
• Assessment Year: 2007-2008
• Appeal Filed On: 11-08-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ROOP CHAND
• Keywords: Unexplained cash credit
• Section: 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD B BENCH AHMEDABAD , BEFORE SHRI SHAILENDRA KUMAR YADAV, JUDICIAL MEMBER, AND SHRI ANIL CHATURVEDI, ACCOUNTANT MEMBER. ITA. NO.2012/AHD/2011 (ASSESSMENT YEAR:2007-08) THE ACIT, CIRCLE-11, AHMEDABAD APPELLANT VS. SHRI BALKRISHNA P. PATEL S - 56/57, BADAMI COAL COMPOUND, NEHRU BRIDGE CORNER, ASHRAM ROAD, AHMEDABAD RESPONDENT PAN: AAXPP3082C /BY APPELLANT : SHRI ROOPCHAND, SR. D.R. /BY RESPONDENT : NONE !' /DATE OF HEARING : 16.02.2015 #$% !' /DATE OF PRONOUNCEMENT : 19.02.2015 ITA NO. 2012/AHD/11 A.Y. 07-08 [ACIT VS. SHRI BALKRISHNA P. PATEL] PAGE 2 ORDER PER SHAILENDRA KUMAR YADAV, J.M: THIS APPEAL HAS BEEN FILED BY THE REVENUE AGAINST T HE ORDER OF COMMISSIONER OF INCOME TAX (APPEALS)-XVI, AHMEDABAD, DATED JUNE 09, 2011 FOR A.Y. 2007-08 ON THE FOLLOWING GROUNDS: (1) THE LD. CIT(A) ERRED IN LAW AND ON FACTS IN RE STRICTING ADDITION TO THE EXTENT OF RS. 1,47,000/- OUT OF TOT AL ADDITION OF RS. 13,48,920/-MADE BY THE AO. ON ACCOUNT OF UNEXPLAINED CASH CREDIT U/S.68 OF THE I. T. ACT WITHOUT PROPERLY APPRECIATING THE FACTS OF THE CASE AND THE MATERIALS BROUGHT ON RECORD BY THE AO. (1.2) THE LD. CIT(A)-XVL, AHMEDABAD HAS ERRED IN L AW AND ON FACTS IN ACCEPTING THE CONTENTION OF THE ASSESSE E THAT IT IS NOT THE DUTY OF THE ASSESSEE TO PROVE AN D ESTABLISH THE SOURCE OF THE SOURCE. IF IS NOT THE B URDEN OF THE ASSESSEE TO THE GENUINENESS OF THE TRANSACTI ONS BETWEEN HIS CREDITOR AND SUB-CREDITORS NOR IS IT TH E BURDEN OF THE ASSESSEE TO PROVE THAT THE SUB-CREDIT OR HAD THE CREDITWORTHINESS TO ADVANCE THE CASH CREDIT TO THE CREDITOR FROM WHOM THE CASH CREDIT HAS BEEN, EVENTUALLY, RECEIVED BY THE ASSESSEE. 2. ASSESSING OFFICER MADE CERTAIN ADDITIONS TO THE INCOME OF ASSESSEE AT RS.13,48,920/- U/S.68 OF THE ACT ON ACC OUNT OF UNEXPLAINED CASH CREDIT. IN APPEAL, MATTER WAS CAR RIED BEFORE THE CIT(A), WHEREIN VARIOUS CONTENTIONS WERE RAISED ON BEHALF OF ASSESSEE AND HAVING CONSIDERED THE SAME, CIT(A) HAS GRANTED RELIEF TO THE ASSESSEE. SAME HAS BEEN OPPO SED ON BEHALF OF REVENUE. NONE APPEARED ON BEHALF OF ASS ESSEE. ITA NO. 2012/AHD/11 A.Y. 07-08 [ACIT VS. SHRI BALKRISHNA P. PATEL] PAGE 3 HOWEVER, ASSESSEE HAS MOVED APPLICATION FOR ADJOURN MENT, NOT FINDING ANY SUBSTANCE IN THE ADJOURNMENT APPLICATIO N, SAME IS REJECTED AND MATTER IS BEING DECIDED EX PARTE ON TH E BASIS OF SUBMISSION OF LEARNED DEPARTMENTAL REPRESENTATIVE AND MATERIALS ON RECORD. 3. AFTER GOING THROUGH RIVAL SUBMISSIONS AND MATERI AL ON RECORD, WE FIND THAT CIT(A) GRANTED PARTIAL RELIEF AFTER CALLING REMAND REPORT. AS PER FACTS OF THE CASE, ASSESSEE HAD INTRODUCED CASH CREDITS OF RS. 13,48,920/- FROM TWE LVE PERSONS AS LISTED ON PAGE-2 OF THE ASSESSMENT ORDER FOR THE SAKE OF CONVENIENCE, SAME IS REPRODUCED AS UNDER: SR. NO. NAME AMOUNT (RS.) DATE MODE OF PAYMENT SOURCE OF INCOME 1 JAGDISH NATWARBHAI 1.00,000 2,00,000 18-08- 2008 25-09-2008 CHEQUE CHEQUE -- 2 RASIKBHAI H. BHAVSAR 1,02,040 02-03- 2007 CHEQUE TRAVEL AGENCY 3 KINJALBEN R. BHAVSAR 1,03,880 26-03- 2007 CHEQUE TRAVEL AGENCY 4 PARBHATBHAI DHIRUBHAI 4,00,000 08-02- 2007 DRAFT 906582 TO 86 906591 TO 95 AGRICULTURE 5 BHAGVANBHAI KESHAVBHAI 50,000 15-12-2006 DRAFT NO. 480571 AGRICULTURE 6 GORDHANBHAI MULJIBHAI 49,000 15-12-2006 DRAFT NO. 480572 AGRICULTURE 7 GOVINDBHAI KALABHAI 49,000 15-12-2006 DRAFT NO.480573 AGRICULTURE 8 KALUBHAI NANUBHAI 49,000 15-12-2006 DRAFT NO. 480574 AGRICULTURE 9 JADAYJIBHAI NARSINHABHAI 49,000 16-01-2007 DRAFT NO. 48 1824 AGRICULTURE 10 HIMMATBHAI NANUBHAI 49,000 16-01-2007 DRAFT NO. 48 1825 AGRICULTURE ITA NO. 2012/AHD/11 A.Y. 07-08 [ACIT VS. SHRI BALKRISHNA P. PATEL] PAGE 4 11 RAGHAVJIBHAI NARSINHABHAI 49,000 16-01-2007 DRAFT NO.481826 AGRICULTURE 12 KANUBHAI BHIMJIBHAI 49,000 16-01-2007 DRAFT NO. 481827 AGRICULTURE TOTAL: 13,48,920 OUT OF THESE TWELVE PERSONS, NINE PERSONS ARE AGRIC ULTURISTS FROM WHOM DEPOSITS OF RS. 7,93,000/- (RS. 4,00,000/ - FROM PRABHATBHAI DHIRUBHAI, RS. 50,000/- FROM BHAGVANBHA I KESHAVBHAI AND RS. 49,000/- EACH FROM GORDHANBHAI MULJIBHAI, GOVINDBHAI KALABHAI, KALUBHAI NANUBHAI, JADAYJIBHAI NARSINHABHAI, HIMMATBHAI NANUBHAI, RAGHAVJIBHAI NARSINHABHAI & KANUBHAI BHIMJIBHAI. I T IS UNDISPUTED THAT DEPOSITS WERE RECEIVED BY WAY OF BA NK DRAFTS. SHRI RASIKBHAI H. BHAVSAR AND. SMT. KINJAL P. BHAVS AR ARE BEING ASSESSED TO TAX AND FROM THEM THE DEPOSITS OF RS. 1,02,040/- AND RS. 1,03,880/-RESPECTIVELY WERE RECE IVED BY CHEQUES. APART FROM THIS, DEPOSITS OF RS. 3,00,000 /- WAS RECEIVED BY WAY OF CHEQUE FROM JAGDISH NATWARBHAI. THUS, DEPOSITS RECEIVED BY ASSESSEE FROM ABOVE SAID TWELV E PERSONS WERE NOT ACCEPTED AS GENUINE AND ADDITION WAS MADE BY ASSESSING OFFICER U/S. 68 OF THE ACT BY TREATING TH E CASH CREDITS AS UNEXPLAINED. ELEVEN DEPOSITORS HAD FILED THEIR NOTARIZED AFFIDAVITS BEFORE THE ASSESSING OFFICER AND ALSO FU RNISHED WRITTEN REPLIES IN RESPONSE TO SUMMONS ISSUED TO TH EM BY ASSESSING OFFICER. COPIES OF THE AFORESAID AFFIDAV ITS AND WRITTEN REPLIES TO THE SUMMONS WERE FILED WITH ASSESSING OF FICER AND AGAIN SENT TO THE ASSESSING OFFICER WHILE CALLING F OR THE REMAND REPORT FROM THE ASSESSING OFFICER. ITA NO. 2012/AHD/11 A.Y. 07-08 [ACIT VS. SHRI BALKRISHNA P. PATEL] PAGE 5 4. IN FIRST APPELLATE PROCEEDING, ACCORDING TO CIT( A) PROPER TIME WAS NOT GIVEN BY ASSESSING OFFICER FOR EXAMINATION OF CASH CREDITORS. IT IS NOT IN DISPUTE THAT DULY SWORN AN D NOTARIZED AFFIDAVITS OF THE PARTIES APART FROM THE REPLY AND EVIDENCES FILED DIRECTLY BY THE PARTIES IN RESPONSE TO SUMMONS ISSU ED. IT SHOWS THAT THE ADDITION IS BASED MERELY ON REJECTIO N OF THE SAID EVIDENCES WITHOUT INDEPENDENTLY BRINGING ON RECORD ANY MATERIAL TO DISPROVE THE SAME. NONETHELESS, DURING THE COURSE OF REMAND PROCEEDINGS, ASSESSING OFFICER HAS ISSUED SUMMONS TO ONLY 9 PARTIES OUT OF 12 PARTIES IN THE REMAND R EPORT. CONSIDERING THE FACT THAT SUMMONS WERE ISSUED BY AS SESSING OFFICER TO 11 OUT OF TOTAL 12 PARTIES (NO SUMMONS H AVE BEEN ISSUED IN CASE OF ONE PARTY I.E. JAGDISHBHAI EVEN D URING THE COURSE OF ORIGINAL ASSESSMENT PROCEEDINGS). ASSESSI NG OFFICER HAS NOT DISPUTED THE GENUINENESS OF THE DEPOSITS RE CEIVED FROM THREE PERSONS NAMELY JAGDISHBHAI, BHAGWANBHAI AND HIMMATBHAI AGGREGATING TO RS.3,99,000/- AND FURTHER CONSIDERING THE FACT THAT THE SAID PARTIES HAVE FUR NISHED SUFFICIENT EVIDENCES IN SUPPORT OF THE GENUINENESS OF THE DEPOSITS GIVEN TO ASSESSEE INCLUDING THEIR NOTARIZE D AFFIDAVITS, CIT(A) RIGHTLY AGREED TO DELETE THE ADDITION TO THE EXTENT OF RS.3,99,000/- AS UNEXPLAINED DEPOSITS FROM THE AFOR ESAID THREE PERSONS. MOREOVER, IT IS SETTLED POSITION OF LAW T HE CONTENTS OF THE AFFIDAVIT CANNOT BE REJECTED WITHOUT CONFRONTIN G THE CONTENTIONS OF THE SAME DEPONENT. ITA NO. 2012/AHD/11 A.Y. 07-08 [ACIT VS. SHRI BALKRISHNA P. PATEL] PAGE 6 4.1 CIT(A) FURTHER FOUND THAT SHRI RASIK BHAVSAR AN D SMT. KINJAL BHAVSAR FROM WHOM DEPOSITS AGGREGATING TO RS.2,05,920/- HAVE BEEN RECEIVED AND TREATED AS UNE XPLAINED BY ASSESSING OFFICER. THESE PARTIES FURNISHED THE COPY OF THEIR RETURN OF INCOME ALONG WITH BALANCE SHEET AND PROFI T & LOSS ACCOUNT. THE SAID PARTIES HAVE ALSO FURNISHED THEIR DULY SWORN AND NOTARIZED AFFIDAVITS. FROM THESE, CIT(A) OBSERV ED THAT TOTAL AMOUNT ADVANCED TO ASSESSEE WAS ALSO REFLECTED IN T HEIR BALANCE SHEET. THERE WAS NOTHING ON RECORD TO DISP ROVE THE SAID FACT. NOT ONLY THAT THEY HAVE CONFIRMED THE F ACT OF HAVING ADVANCED MONEY TO ASSESSEE IN STATEMENTS RECORDED B Y ASSESSING OFFICER. IN THIS BACKGROUND, CIT(A) RIGHT LY OBSERVED THAT PRIMARY ONUS U/S. 68 HAS BEEN DISCHARGED. ACC ORDINGLY, THIS ADDITION TO THE EXTENT OF RS.2,05,920/- WAS RI GHTLY DELETED BY CIT(A). WE UPHOLD THE SAME. 4.2 WITH REGARD TO DEPOSIT OF RS.4,00,000/- RECEIVE D FROM PARBATBHAI DHIRUBHAI IS CONCERNED, CIT(A) OBSERVED THAT THE SAID PARTY WAS ISSUED SUMMONS U/S.131 DURING COURSE OF ASSESSMENT PROCEEDINGS. IN RESPONSE TO WHICH HE HA S FURNISHED HIS CONFIRMATION BY DULY SWORN AFFIDAVIT AS WELL AS EVIDENCES IN FORM OF 7/12 & 8A EXTRACT IN SUPPORT O F SOURCE OF INCOME. SINCE THE SUMMONS ISSUED HAVING BEEN SERVE D AND IDENTITY IS ESTABLISHED. FURTHER, SINCE MONEY ADVA NCED WAS NOT BEING IN CASH AND EVIDENCES FURNISHED IN SUPPOR T OF SOURCE OF INCOME INCLUDING NOTARIZED AFFIDAVIT HAVING NOT BEEN DISPROVED BY THE ASSESSING OFFICER. MERELY BECAUSE THE SAID ITA NO. 2012/AHD/11 A.Y. 07-08 [ACIT VS. SHRI BALKRISHNA P. PATEL] PAGE 7 PARTY DID NOT TURN UP IN RESPONSE TO SUMMONS ONCE A GAIN ISSUED DURING THE REMAND PROCEEDINGS, ASSESSEE COUL D NOT BE PUNISHED. EVEN IN CASE OF NON-COMPLIANCE, SECOND SU MMON COULD HAVE BEEN ISSUED BY ASSESSING OFFICER, WHICH HAS NOT BEEN DONE. IN THIS BACKGROUND, CIT(A) WAS JUSTIFIE D IN DELETING THE ADDITION OF RS.4,00.000/- RECEIVED FROM PARBAT BHAI DHIRUBHAI. 4.3 COMING TO REMAINING 6 PARTIES FROM WHOM DEPOSIT S OF RS.49.000/- EACH WERE RECEIVED AS DISCUSSED ABOVE. IN THIS BACKGROUND, CIT(A) OBSERVED FROM THEIR STATEMENTS R ECORDED BY ASSESSING OFFICER THAT IN CASE OF SHRI KALUBHAI NAN UBHAI PANSENA, THERE APPEARS TO BE SUFFICIENT SOURCE OF I NCOME AND HENCE KEEPING IN VIEW THE OTHER EVIDENCES FURNISHED BY HIM AND CATEGORICAL RE-CONFIRMATION OF THE FACT OF HAVI NG GIVEN ADVANCE TO ASSESSEE IN THE STATEMENT RECORDED, CIT( A) RIGHTLY OBSERVED THAT ADDITION OF RS.49,000/- IN HIS CASE W AS NOT JUSTIFIED. THIS REASONED FINDING OF CIT(A) NEEDS N O INTERFERENCE FROM OUR SIDE. WE UPHOLD THE SAME. 4.6 OTHER 2 PARTIES I.E. JADAVJIBHAI AND RAGHAVJIBH AI DID NOT APPEAR IN RESPONSE TO THE SUMMONS ISSUED DURING REM AND PROCEEDINGS. HOWEVER, IN RESPONSE TO EARLIER SUMMON S ISSUED DURING ASSESSMENT PROCEEDINGS THEY HAD FURNISHED TH EIR CONFIRMATION BY DULY SWORN AFFIDAVIT AS WELL AS EVI DENCES IN FORM OF 7/12 & 8A EXTRACT IN SUPPORT OF SOURCE OF I NCOME. SINCE SUMMONS ISSUED HAVING BEEN SERVED, THE IDENTI TY STANDS ITA NO. 2012/AHD/11 A.Y. 07-08 [ACIT VS. SHRI BALKRISHNA P. PATEL] PAGE 8 ESTABLISHED. THE AMOUNT ADVANCED WAS NOT BEING IN CASH AND EVIDENCES FURNISHED IN SUPPORT OF SOURCE OF INCOME INCLUDING NOTARIZED AFFIDAVIT HAVING NOT BEEN DISPROVED BY AS SESSING OFFICER, MERELY BECAUSE SAID PARTIES DID NOT TURN U P IN RESPONSE TO SUMMONS ONCE AGAIN SUMMONS ISSUED DURIN G THE REMAND PROCEEDINGS, ASSESSEE CANNOT BE PUNISHED AS HELD EARLIER BY CIT(A) AND WE HAVE APPROVED THE SAME. ACCORDINGLY, ADDITION OF RS.49,000/- EACH IN CASE OF THESE TWO P ERSONS AGGREGATING TO RS,98,000/- WAS RIGHTLY DELETED BY C IT(A). WE UPHOLD THE SAME. 4.7 THUS, IN SUM AND SUBSTANCE OUT OF TOTAL ADDITIO N OF RS. 13,48,920/- MADE BY ASSESSING OFFICER, THE ADDITIO N TO THE EXTENT OF RS.12,01,920/- WAS DELETED BY CIT(A). SA ME IS CONFIRMED. 5. AS A RESULT, APPEAL FILED BY THE REVENUE IS DISM ISSED. PRONOUNCED IN THE OPEN COURT ON THIS THE 19 TH DAY OF FEBRUARY, 2015. SD/- SD/- (ANIL CHATURVEDI) (SHAILENDRA KUMAR YADAV) ACCOUNTANT MEMBER JUDICIAL MEMBER AHMEDABAD: DATED 19/02/2015 TRUE COPY S.K.SINHA & & & & ' ' ' ' ('% ('% ('% ('% / COPY OF ORDER FORWARDED TO:- 1. +, / REVENUE 2. / ASSESSEE ITA NO. 2012/AHD/11 A.Y. 07-08 [ACIT VS. SHRI BALKRISHNA P. PATEL] PAGE 9 3. // 0 / CONCERNED CIT 4. 0- / CIT (A) 5. '45 , , / DR, ITAT, AHMEDABAD 6. 589 :; / GUARD FILE. BY ORDER / & ,