USHA KARTIKEYAN, MUMBAI V. ITO 22(2)(2), NAVI MUMBAI

ITA 2019/MUM/2014

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 92757 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 2 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-06-2015
• Appeal Filed By: Assessee
• Bench Allotted: SMC
• Next Hearing Date: 16-06-2015
• Assessment Year: 2009-2010
• Appeal Filed On: 25-03-2014
• Court: TRIBUNAL
• Department Lawyers: V K BORA SR
• Assessee Lawyers: KIRIT MEHTA
• Keywords: Unexplained investment; Business income
• Section: 68; 6

Judgement Text

IN THE INCO ME TAX APPELLATE TRIBUNAL SMC BENCH, MUMBAI BEFORE SHRI D. KARUNAKARA RAO, ACCOUNTANT MEMBER ./I.T.A. NO. 2019/M/2014 ( AY: 2009 - 2010 ) MRS. USHA KARTIKEYAN, 61 - A, MITTAL TOWERS, NARIMAN POINT, MUMBAI - 05. / VS. THE INCOME TAX OFFICER, WARD 22(2)(2) , MUMBAI. ./ PAN : AAAPH8639L ( / APPELLANT) .. ( / RESPONDENT ) / APPELLANT BY : MR. KIRIT MEHTA / RESPONDENT BY : SHRI V.K. BORA, SR. AR / DATE OF HEARING : 16 .6.2015 / DATE OF PRONOUNCEMENT :16 .6.2015 / O R D E R PER D. KARUNAKARA RAO, AM: THIS APPEAL FILED BY THE ASSESSEE ON 25.3.2014 IS AGAINST THE ORDER OF THE CIT (A) - 7, MUMBAI DATED 16.1.2014 FOR THE ASSESSMENT YEAR 2009 - 2010. IN THIS APPEAL, ASSESSEE RAISED THE FOLLOWING GROUNDS WHICH READ AS UNDER: 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, CIT (A) ERRED IN CONFIRMING THE ADDITION MADE BY AO OF RS. 3,00,000/ - U/S 69B, WITHOUT TAKING COGNIZANCE OF VARIOUS EVIDENCE SUBMITTED DURING APPELLATE PROCEEDINGS. THEREFORE, APPELLANT PRAYS THAT THE ORDER OF THE CIT (A) SHALL BE QUASHED. 2. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, CIT (A ) ERRED REMITTING THE ISSUE TO SET OFF OF BUSINESS LOSS CARRIED FORWARD TO AO WITHOUT APPRECIATING THE MATERIAL ON RECORD. APPELLANT THEREFORE PRAYS THAT BUSINESS INCOME OF RS. 2,84,311/ - SET OFF AGAINST EARLIER YEARS LOSSES SHALL BE ALLOWED. 2. AT THE O UTSET, LD COUNSEL FOR THE ASSESSEE SUBMITTED THAT GROUND NO.2 IS NOT PRESSED. AFTER HEARING THE LD DR IN THIS REGARD, THE SAID GROUND NO.2 IS DISMISSED AS NOT PRESSED. THAT LEAVES, GROUND NO.1 FOR OUR ADJUDICATION. 3. BRIEFLY STATED, RELEVANT FACTS IN THIS REGARD ARE THAT THE ASSESSEE IS AN INDIVIDUAL FILED THE E - RETURN OF INCOME DECLARING THE TOTAL INCOME OF RS. NIL IN FROM NO. ITR - 4. I N THE PORTION PART A - BS (PAGE 8 OF THE PAPER BOOK IS RELEVANT) OF THE 2 SAID FORM - 4, ASSESSEE MENTIONED A SUM OF RS. 55 ,25,660/ - AGAINST THE COLUMN PROPRIETORS FUND. DURING THE SCRUTINY ASSESSMENT PROCEEDINGS, ASSESSEE REVISED THE RETURN, OF COURSE BELATEDLY, AND CORRECTED THE ABOVE FIGURES TO RS. 52,25,660/ - . THE BALANCE OF RS. 3 LAKHS WAS SHOWN AS UNSECURED LOAN IN COLUMN 2(B) OF THE SAME PART A - BS. THIS SUM OF RS. 3 LAKHS HAS BECOME THE AREA OF DISPUTE BETWEEN THE PARTIES IN THE ASSESSMENT PROCEEDINGS. IT IS THE CLAIM OF THE ASSESSEE THAT SUM OF RS. 3 LAKHS WAS RECEIVED AS LOAN FROM HER HUSBAND MR. K.S. KARTIKEYAN . IN RESPECT OF THE CLAIM, ASSESSEE RELIED ON THE BALANCE SHEET (PAGE 2 OF THE PB), WHEREIN RS. 3 LAKHS IS SHOWN AS LOAN RE CEIVED FROM MR. K.S. KARTIKEYAN AND THE CAPITAL ACCOUNT OF THE ASSESSEE WAS ALSO FURNISHED. ASSESSEE ALSO RELIED ON THE CONFIRMATION LETTER RECEIVED FROM MR. K.S. KARTIKEYAN, WHO WAS ASSESSED TO TAX WITH PAN: ANQPK7933F (PAGE 4 OF THE PB). RELEVANT BANK STATEMENTS OF BOTH THE ASSESSEE AS WELL AS MR. K.S. KARTIKEYAN WERE ALSO PLACED ON RECORD FROM PAGES 24 TO 29 OF THE PAPER BOOK. BAS ING ON THE ABOVE VOLUME OF EVIDENCE, ASSESSEE PLEADS THAT THIS IS A LOAN FROM THE HUSBAND AND THE SAME WAS ERRONEOUSLY QUOTED UNDER THE HEAD PROPRIETORS FUND WHILE MENTIONING RS. 55,25,660/ - IN PART A - BS OF ITR - 4. THIS IS A BONA FIDE MISTAKE AND THE F ACT IS THAT THE SAID AMOUNT OF RS. 3 LAKHS IS AN UNSECURED LOAN FROM MR. K.S. KARTIKEYAN. AO DID NOT ACCEPT THE EXPLANATION OF THE ASSESSEE AND NOT CONSIDERED THE SAID BELATED REVISED E - RETURN OF INCOME AND PROCEEDED TO MAKE ADDITION WITHOUT GOING TO THE GENUINENESS OF THE TRANSACTION AND CONFIRMATION LETTER AND BANK STATEMENTS FURNISHED BY THE ASSESSEE. ON APPEAL, CIT (A) CONFIRMED THE DECISION OF THE AO. AGGRIEVED, ASSESSEE FILED THE PRESENT APPEAL BEFORE THE TRIBUNAL. 4. DURING THE PROCEEDINGS BEFORE THE TRIBUNAL, LD COUNSEL FOR THE ASSESSEE BROUGHT OUR ATTENTION TO THE ENTIRE HISTORY OF THE TRANSACTIONS AND SUBMITTED THAT THE PROVISIONS OF SECTION 69B OF THE ACT, INVOKED BY THE ASSESSING OFFICER, ARE NOT LEGALLY SUSTAINABLE. THERE IS NO UNACCOUNTED INVESTMENT BY THE ASSESSEE , AND IT IS A CONDITION PRECEDENT FOR INVOKING THE SAID PROVISIONS OF SECTION 69B OF THE ACT. FURTHER, RELYING ON VARIOUS DECISIONS, HE SUBMITTED THAT THIS IS A CASE FOR UNSECURED LOANS, THE PROVISIONS OF SECTION 6 8 OF THE ACT MA Y BE RELEVANT ON THE FACTS OF THESE TRANSACTIONS. FURTHER, DEMONSTRATING THE FULFILMENT OF THE CONDITIONS SPECIFIED IN U/S 68 OF THE ACT, LD COUNSEL FOR THE ASSESEE SUBMITTED THAT THERE IS NO CASE FOR INVOKING THE PROVISIONS OF SECTION 68 OF THE ACT, CONS IDERING THE FULFILMENT OF CONDITIONS AND DISCHARGING OF INITIAL ONUS BY THE ASSESSEE. 3 5. ON THE OTHER HAND, LD DR FOR THE REVENUE RELIED ON THE ORDERS OF THE AO AND THE CIT (A). 6. AFTER HEARING BOTH THE PARTIES AND ON PERUSAL OF THE ORDERS OF THE REVENU E AUTHORITIES, I FIND THAT THE REVENUE AUTHORITIES HAVE NOT CONSIDERED THE GENUINENESS OF THE TRANSACTIONS AND IGNORED THE CONFIRMATION LETTERS FURNISHED BY THE LOAN CREDITOR. ASSESSEE REVISED THE E - RETURN OF INCOME CORRECTING THE MISTAKE IN PROPRIETORS FUND AND THE UNSECURED LOAN. ASSESSEE ALSO FURNISHED ALL PRIMARY DETAILS TO DEMONSTRATE THAT THE UNDERLINED TRANSACTION IS MERELY A GENUINE LOAN TRANSACTION AND NOTHING ELSE. THEREFORE, IN MY OPINION, THE DECISION MADE BY THE AO IS NOT SUSTAINABLE. AO SHOULD HAVE APPRECIATED THE BONA FIDE MISTAKES, WHICH CAN HAPPEN WITH ANYBODY , CONSIDERING THE COMPLEXITY OF THE E - RETURN OF INCOME . ACCORDINGLY, I FIND, THIS IS NOT A FIT CASE FOR MAKING ADDITION OF RS. 3 LAKHS U/S 69B / 68 OF THE ACT. ACCORDINGLY, G ROUNDS RAISED BY THE ASSESSEE ARE ALLOWED. 7. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 16TH JUNE, 2015. SD/ - (D. KARUNAKARA RAO) ACCOUNTANT MEMBER MUMBAI ; 16.6 .201 5 . . ./ OKK , SR. PS / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ( ) / THE CIT - 4. / 5. , , / DR, ITAT, MUMBAI 6. / GUARD FILE . //TRUE COPY// / BY ORDER, / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI