The ACIT,Vapi Circle, Vapi V. Shri Mohmad Yakub Ahmed Saiyed, Vapi

ITA 2022/AHD/2011

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 80300 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-08-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 27-08-2014
• Assessment Year: 2008-2009
• Appeal Filed On: 12-08-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: V K SINGH
• Keywords: Unexplained cash credit; Unexplained investment; Assessment record
• Section: 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, AHMEDABAD BEFORE SHRI MUKUL KR. SHRAWAT, JUDICIAL MEMBER AND SHRI N.S. SAINI, ACCOUNTANT MEMBER ITA NO.2022/AHD/2011 A.Y.2008-09 ACIT, VAPI CIRCLE, VAPI. VS MOHMAD YAKUB AHMED SAIYED, FLAT NO.11, 2 ND FLOOR, AZAD MANSION, GIDC, VAPI PAN: AEQPS 7055F (APPELLANT) (RESPONDENT) CO NO.207/AHD/2011 A.Y.2008-09 MOHMAD YAKUB AHMED SAIYED, FLAT NO.11, 2 ND FLOOR, AZAD MANSION, GIDC, VAPI PAN: AEQPS 7055F VS ACIT, VAPI CIRCLE, VAPI. (APPELLANT) (RESPONDENT) REVENUE BY : SHRI V.K. SINGH, SR.D.R., ASSESSEE(S) BY : SHRI URVASHI SHODHAN, AR / // / DATE OF HEARING : 27/08/2014 / DATE OF PRONOUNCEMENT: 28/08/2014 / O R D E R PER SHRI MUKUL KUMAR SHRAWAT, JUDICIAL MEMBER THIS IS AN APPEAL FILED BY THE REVENUE AND THE CROS S OBJECTION BY THE RESPONDENT-ASSESSEE, BOTH ARISING FROM THE ORDE R OF LD. CIT(APPEALS), VALSAD, DATED 30/06/2011 AND THE GROUNDS RAISED BY THE REVENUE ARE HEREBY DECIDED AS FOLLOWS: 1. ON THE FACT AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) HAS ERRED IN ALLOWING ADDITION OF RS.9,50,000/- ON ACCOUNT OF UNEXPLAINED INVESTMENT IN INNOVA CAR. ITA NO.2022/AHD/2011 & CO NO.207/AHD/2011 ACIT, VAPI CIRCLE, VAPI VS. MOHMAD YAKUB AHMED SAIY ED FOR A.Y. 2008-09 - 2 - 2. IN BRIEF THE FACTS AS EMERGED FROM THE CORRESPON DING ASSESSMENT ORDER PASSED U/S. 143(3), DATED 31.12.2010 WERE THA T THE ASSESSEE IN INDIVIDUAL CAPACITY HAS FILED THE RETURN DECLARING AN INCOME OF RS.3,29,668/-, HOWEVER, THE AO HAS NOTED THAT THERE WAS AN UNEXPLAINED INVESTMENT IN A CAR ALLEGED TO BE INNOVA CAR AMOU NTING TO RS.9,50,000/-. 2.1 WHEN THE MATTER WAS CARRIED BEFORE THE FIRST AP PELLATE AUTHORITY, IT WAS EXPLAINED THAT THE ASSESSEE HAD TAKEN LOAN F ROM ICICI BANK AND THE CAR PURCHASED WAS A SANTRO CAR AND NOT THE I NNOVA CAR. IT WAS EXPLAINED THAT DUE TO TYPING ERROR A WRONG NAME WAS MENTIONED IN THE LEDGER ACCOUNT AS ICICI LOAN (INNOVA). IT WAS ALS O EXPLAINED THAT THE TRANSACTION PERTAINED TO A.Y. 2005-06 WAS DULY RECO RDED IN THE AUDITED ACCOUNTS OF THE ASSESSEE. CONSIDERING THOSE FACTS, LEARNED CIT(A) HAS HELD AS UNDER: 5.3 DECISION :- I HAVE CAREFULLY CONSIDERED THE OBSERVATION OF THE AO IN THE ASSESSMENT ORDER AS WELL AS THE CONTENTIONS RAISED BY THE AR OF THE APPELLANT. THE FACTUM OF THE CASE IS THAT THE APPEL LANT TOOK LOAN FROM 1C1C1 BANK, VAPI BRANCH FOR PURCHASE OF SANTRO XING CAR D URING THE FINANCIAL YEAR 2004-05 AND THE APPELLANT HAS BEEN MAKING EM1 PAYME NT SINCE THEN. THE COPY OF THE PURCHASE BILL OF SANTRO CAR ALONG-WITH EM1 STATEMENT WAS PRODUCED BEFORE ME. THE ID. AR ALSO STATED THAT THE ACCOUNTANT HAD WRONGLY MADE THE INNOVA INSTEAD OF SANTRO CAR. THE APPELLAN T ALSO NEVER OWNED INNOVA CAR AS EXPLAINED BY THE ID. AR. THERE IS NO DISPUTE THAT THE EMI PAYMENTS HAVE BEEN MADE BY THE APPELLANT DURING THE YEAR. IN VIEW OF THIS THE ADDITION MADE FOR PURCHASE OF THE CAR TREATING AS U NEXPLAINED INCOME BY THE AO IS NOT SUSTAINABLE. THE AO IS THEREFORE, DIRECTE D TO DELETE THE ADDITION. THIS GROUND OF APPEAL IS ALLOWED. 3. FROM THE SIDE OF THE REVENUE, LEARNED SR.D.R., M R. V.K. SINGH HAS PLACED RELIANCE ON THE ORDER OF THE AO. IT WAS ARGU ED THAT LEARNED CIT(A) HAD ADMITTED CERTAIN FRESH EVIDENCES WITHOUT OFFERI NG AN OPPORTUNITY TO THE AO. MAIN THRUST OF LEARNED SR.D.R. WAS TO RESTO RE THE MATTER BACK TO ITA NO.2022/AHD/2011 & CO NO.207/AHD/2011 ACIT, VAPI CIRCLE, VAPI VS. MOHMAD YAKUB AHMED SAIY ED FOR A.Y. 2008-09 - 3 - THE STAGE OF THE AO SO THAT THE AMOUNT OF LOAN AND THE CORRECT FACTS ABOUT THE CAR COULD FURTHER BE INVESTIGATED. 4. FROM THE SIDE OF THE RESPONDENT-ASSESSEE, LEARNE D AR, URVASHI SHODHAN HAS DRAWN OUR ATTENTION ON THE PURCHASE BIL L OF SANTRO CAR DETAILS OF REPAYMENT OF LOAN AND THE PROFIT AND LOS S ACCOUNT AND BALANCE SHEET OF THE ASSESSEE AND THE RETURN OF INCOME FOR A.Y.2005-06. ON THE BASIS OF ALL THOSE EVIDENCES, IT WAS STRONGLY PLEAD ED THAT ALL THE REQUISITE INFORMATION WAS VERY MUCH IN THE PAST RECORD OF THE ASSESSEE; HENCE, THERE WAS OCCASION TO TAX THE AMOUNT OF INVESTMENT AS AN UNEXPLAINED INVESTMENT FOR THE YEAR UNDER CONSIDERATION. 5. HAVING HEARD THE SUBMISSIONS OF BOTH THE SIDES A ND AFTER CONSIDERING THE EVIDENCES ON RECORD IN THE COMPILAT ION FILED BEFORE US, WE ARE OF THE VIEW THAT SINCE INCEPTION THE ASSESSE ES STAND WAS THAT THE INVESTMENT IN THE CAR WAS DULY DISCLOSED AS PER THE BOOKS OF ACCOUNT AND NOTHING PERTAINED TO THE YEAR UNDER CONSIDERATION. THE BOOKS OF ACCOUNT AND THE INFORMATION IN RESPECT OF REPAYMENT WAS VER Y MUCH PART OF THE ASSESSMENT RECORD, HAS VEHEMENTLY ARGUED BEFORE US. WE, THEREFORE, APPROVE THE FACTUAL FINDING OF LEARNED CIT(A) AND F IND NO FORCE IN THE ARGUMENT OF LEARNED DR. RESULTANTLY, THIS GROUND OF THE REVENUE IS HEREBY DISMISSED. 6. GROUND NO.2 IS REPRODUCED BELOW: THE LD. CIT(A) HAS ALLOWED THE ADDITION OF RS.5,80 ,000/- ON ACCOUNT OF UNEXPLAINED CASH CREDITS (DEPOSIT RECEIVED). ITA NO.2022/AHD/2011 & CO NO.207/AHD/2011 ACIT, VAPI CIRCLE, VAPI VS. MOHMAD YAKUB AHMED SAIY ED FOR A.Y. 2008-09 - 4 - 6.1 THE AO HAS NOTED THAT IN THE BOOKS OF ACCOUNT, THERE WERE DEPOSITS RECEIVED BY THE ASSESSEE TO THE TUNE OF RS.5,80,000 /-, THE SAME WAS HELD AS UNEXPLAINED CASH CREDIT U/S.68 OF IT ACT AND TAX ED IN THE HANDS OF THE ASSESSEE. 7. WHEN THE MATTER WAS CARRIED BEFORE THE FIRST APP ELLATE AUTHORITY, IT WAS INFORMED THAT THE ASSESSEE HAD REGULAR RENTA L INCOME AND THE TENANTS HAVE MADE THOSE DEPOSITS IN RESPECT OF RENT ED PROPERTY. THE TENANTS WERE GENERALLY TRANSPORTERS WHO HAVE TAKEN THE OFFICE ON RENT, EXPLAINED BY THE ASSESSEE. CONSIDERING THOSE FACTS, LEARNED CIT(A) HAS DECIDED THIS ISSUE IN ASSESSEES FAVOUR AS UNDER: 6.3 DECISION:- I HAVE CAREFULLY CONSIDERE D THE OBSERVATIONS OF THE AO IN THE ASSESSMENT ORDER AS WELL AS THE CONTENTIO NS RAISED BY THE AR OF THE APPELLANT. PROBABLY THE AO MADE ADDITION OF THAT AM OUNT BECAUSE THE APPELLANT COULD NOT SUBMIT THE CONFIRMATIONS FROM T HOSE DEPOSITORS. ON THE OTHER HAND THE ID. AR SUBMITTED THAT THE ADVANCES W ERE RECEIVED NOT DURING THE YEAR BUT EARLIER YEARS. THE ADVANCES WERE TOWAR DS RENTING THE PREMISES AND THE INCOME FROM WHICH HAS BEEN SHOWN AS HOUSE P ROPERTY INCOME AS CONTENDED BY THE ID. AR. FURTHER IT WAS CONTENDED T HAT A LIST CONTAINING NAME AND ADDRESS OF THE DEPOSITORS WAS GIVEN TO THE AO B UT HE IGNORED THE DETAILS AND MADE THE ADDITION. BEFORE ME THE ID. AR ALSO SU BMITTED THAT SOME OF THE TENANTS HAVE ALREADY LEFT, I AGREE WITH THE AR OF T HE APPELLANT THAT THE APPELLANT HAD SHOWN RENT INCOME UNDER THE HEAD INCO ME FROM HOUSE PROPERTY AND THE DEPOSITS RECEIVED FROM TENANTS WERE ALSO AC CEPTED BY THE AO IN THE PREVIOUS YEAR. THE APPELLANT ALSO PRODUCED THE LIST OF TENANTS FROM WHOM THE DEPOSITS RECEIVED ALONG WITH THEIR ADDRESSES AND PA N I RELYING ON THE DECISION IN THE CASE OF DY. CIT VS. AMOD PETROCHEM (P) LTD. (2008) 23 (I) ITCL 145 (GUJ-HC): (2008) 217 CTR (GUJ) 401, IN WHI CH, IT WAS HELD THAT AS PER SECTION 68, THERE SHOULD BE CASH CREDITS OF PRE VIOUS YEAR. THERE HAVE TO BE CREDITS OF ANY SUM IN THE BOOKS OF AN ASSESSEE MAIN TAINED FOR ANY PREVIOUS YEAR, ONLY THEN THE SUM SO CREDITED CAN BE BROUGHT TO TAX AS THE INCOME OF THE ASSESSEE OF THAT PREVIOUS YEAR. IN THE INSTANT CASE , THE AMOUNT CREDITED WAS- FOR THE EARLIER YEARS AND THE AMOUNTS RELATING TO T HE ADVANCES FROM THE TENANTS AND THEREFORE, IT WAS EXPLAINED. IN VIEW OF THIS THE ADDITION MADE IS NOT LEGALLY SUSTAINABLE. HENCE, THE AO IS DIRECTED TO DELETE THE ADDITION MADE IN THIS GROUND. THUS, THE APPELLANT SUCCEEDS IN THIS GROUND OF APPEAL. ITA NO.2022/AHD/2011 & CO NO.207/AHD/2011 ACIT, VAPI CIRCLE, VAPI VS. MOHMAD YAKUB AHMED SAIY ED FOR A.Y. 2008-09 - 5 - 8. FROM THE SIDE OF THE REVENUE, LEARNED SR.D.R., S RI V.K. SINGH HAS REITERATED THAT THOSE EVIDENCES WERE NOT PLACED BEF ORE THE AO; HENCE, THE MATTER SHOULD GO BACK FOR RE-ADJUDICATION. 9. FROM THE SIDE OF THE ASSESSEE, LEARNED AR HAS IN FORMED THAT THE DETAILS OF THE DEPOSIT AND THE NAMES OF THE PERSONS AND THE PROPERTY IN RESPECT OF WHICH THE DEPOSITS WERE MADE WERE DULY D ISCLOSED FOR THE ACCOUNTING PERIOD ENDED ON 31 ST MARCH, 2007. THE DEPOSITS WERE IN RESPECT OF THE RENTED PROPERTY; HENCE, THE RENTAL I NCOME HAS ALSO BEEN DISCLOSED BY THE ASSESSEE. LEARNED AR HAS DRAWN OUR ATTENTION AT PAGES 3 AND 6 OF THE COMPILATION CONSISTING THE NAMES, PAN, DETAILS OF THE PREMISES AND THE AMOUNT OF DEPOSITS RECEIVED. 10. CONSIDERING ALL THOSE EVIDENCES BEING FILED IN THE COMPILATION AS ALSO CONSIDERING THE FINDING ON FACTS GIVEN BY LEAR NED CIT(A), WE FIND NO INFIRMITY IN THE VERDICT OF LEARNED CIT(A). THE ASS ESSEE HAS DISCLOSED NOT ONLY THE NAMES OF THE TENANTS WHO HAVE MADE THE DEP OSITS BUT ALSO THEIR PAN INFORMATION; THEREFORE, IT WAS NOT FAIR ON THE PART OF THE AO TO HOLD THAT THE AMOUNT IN QUESTION WAS NOT PROVED IN TERMS OF SECTION 68 OF IT ACT. RESULTANTLY, WE HEREBY CONFIRM THE FINDINGS OF LEARNED CIT(A) AND DISMISS THIS GROUND OF THE REVENUE. CROSS OBJECTION OF THE ASSESSEE 11. FROM THE SIDE OF THE RESPONDENT-ASSESSEE, A CRO SS OBJECTION HAS BEEN MOVED WHICH WAS NOTHING BUT SUPPORTING THE ORD ER OF LEARNED CIT(A). SINCE IN THE CROSS OBJECTION, NO LEGAL OR F ACTUAL ISSUE HAS BEEN ITA NO.2022/AHD/2011 & CO NO.207/AHD/2011 ACIT, VAPI CIRCLE, VAPI VS. MOHMAD YAKUB AHMED SAIY ED FOR A.Y. 2008-09 - 6 - RAISED, THEREFORE, THIS CROSS OBJECTION HAS BECOME REDUNDANT IN THE LIGHT OF OUR VIEW TAKEN IN THE APPEAL OF THE REVENUE SUPR A. 12. IN THE RESULT, THE APPEAL OF THE REVENUE AS WEL L AS THE CROSS OBJECTION OF THE ASSESSEE-RESPONDENT, BOTH ARE DISM ISSED. SD/- SD/- (N.S. SAINI) (MUKUL KR. SHRAWAT) ACCOUNTANT MEMBER JUD ICIAL MEMBER AHMEDABAD; DATED 28/08/2014 PRABHAT KR. KESARWANI, SR. P.S. / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. !' / THE RESPONDENT. 3. #$#% ' '& / CONCERNED CIT 4. 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