ITO, Ramanathapuram V. Smt. Ayisha Parveen, CHENNAI

ITA 2079/CHNY/2012

• Counselvise Citation: [2013] 120 COUNSELVISE.COM (IT) 2501 (ITAT-CHENNAI)
• Duration Of Justice: 5 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-05-2013
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 19-03-2013
• Assessment Year: 2006-2007
• Appeal Filed On: 19-11-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: DR S MOHARANA
• Assessee Lawyers: A RAJAMANIKAM
• Keywords: Unexplained cash credit
• Section: 68; 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH CHENNAI BEFORE SHRI N.S. SAINI, ACCOUNTANT MEMBER AND SHRI V. DURGA RAO, JUDICIAL MEMBER ITA NO.2079/MDS/2012 ASSESSMENT YEAR : 2006-07 THE INCOME TAX OFFICER, WAR-I(1), RAMANATHAPURAM. V. SMT. AYISHA PARVEEN, NO. 25/10, PASUMARTHY STREET, 2 ND LANE, UNITED INDIA COLONY, KODAMBAKKAM, CHENNAI-600 024. (PAN : AAVPP2306G) (APPELLANT) (RESPONDENT) AND C.O. NO. 204/MDS/2012 (IN ITA NO 2079/MDS/2012) ASSESSMENT YEAR : 2006-07 SMT. AYISHA PARVEEN, V. THE I NCOME TAX OFFICER, NO. 25/10, PASUMARTHY STREET, WARD-I(1 ), 2 ND LANE, UNITED INDIA COLONY, RAMANATHAP URAM. KODAMBAKKAM, CHENNAI-600 024. (CROSS OBJECTOR) (RESPONDENT) DEPARTMENT BY : DR. S. MOHARANA, CIT-DR ASSESSEE BY : SHRI A. RAJAMANIKAM, ADVOCATE DATE OF HEARING : 19.03.2013 DATE OF PRONOUNCEMENT : 06.05. 2013 ITA NO.2079/MDS/2012 & C.O. NO. 204/MDS/2012 : 2 : O R D E R PER V. DURGA RAO, JUDICIAL MEMBER : THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST TH E ORDER OF THE CIT(APPEALS)-II, MADURAI DATED 02-08-2012 FO R THE ASSESSMENT YEAR 2006-07. 2. BRIEF FACTS ARE THAT THE ASSESSEE IS AN INDIVIDU AL AND HAD FILED A RETURN OF INCOME FOR THE ASSESSMENT YEAR 20 06-07 ON 13- 10-2006 ADMITTING TOTAL INCOME OF ` 2,07,700/-. INITIALLY THE ASSESSMENT U/S 143(1) OF THE INCOME TAX ACT, 1961 ( 'THE ACT' FOR SHORT) WAS COMPLETED. SUBSEQUENTLY AFTER ISSUI NG NOTICE U/S 143(2) THE ASSESSMENT WAS COMPLETED UNDER SECTION 1 44 OF THE ACT. DURING THE ASSESSMENT PROCEEDINGS THE ASSESSI NG OFFICER OBSERVED THAT THE ASSESSEE HAD MADE INVESTMENT IN A PROPERTY WORTH ` 1.32 CRORES DURING THE YEAR. THE SOURCE OF THE INVESTMENT IS AS UNDER : CASH CREDITS FROM 1. MR. M.Y. ZAFARULLAH ` 50,00,000 2. MRS. Z. GULSHAMNIGAR ` 6,00,000 3. TENANT ADVANCE ` 3,03,000 4. LOAN CREDITORS ` 52,26,500 IN THE ASSESSMENT ORDER THE ASSESSING OFFICER OBSER VED THAT SHRI M. Y. ZAFARULLAH WHO IS ALLEGED TO HAVE ADVANC ED ` 50 LAKHS WAS THE FATHER OF THE ASSESSEE. HE IS ASSESS ED TO INCOME-TAX WITH INCOME TAX OFFICER, WARD-I(2), ITA NO.2079/MDS/2012 & C.O. NO. 204/MDS/2012 : 3 : RAMANATHAPURAM. HE HAS FILED RETURN OF INCOME UPTO THE ASSESSMENT YEAR 2005-06 ONLY. HE HAS NOT FILED THE RETURN OF INCOME FOR THE ASSESSMENT YEAR 2006-07 TILL THE DAT E. WHEN HIS CAPITAL BALANCE AS ON 31.03.2005 WAS ` 14,23,427/- ONLY, IT WAS HIGHLY IMPROBABLE THAT HE HAD ADVANCED CASH TO THE TUNE OF ` 50 LAKHS EARNED BY HIM IN ONE YEAR TO HIS DAUGHTER, SMT. AYISHA PARVEEN. THE LIST OF LOAN CREDITORS WITH TH EIR NAMES AND ADDRESSED WERE NOT FURNISHED ALONG WITH THE RETURN OF INCOME. SIMILARLY, LOAN FROM HER MOTHER, MRS. Z. GULSHAMNIG AR AND RECEIPT OF TENANT ADVANCE WERE ALSO NOT PROVED. FU RTHER A PERUSAL OF THE RETURN OF INCOME FILED BY THE ASSESS EE FOR THE ASSESSMENT YEAR 2005-06 REVEALED THAT HER CAPITAL B ALANCE AS ON 31.03.2005 WAS ` 14,36,600/- ONLY. HOWEVER, THE OPENING BALANCE OF THE ASSESSEE BROUGHT FORWARD AS ON 01-04 -2005 FOR THE ASSESSMENT YEAR 2006-07 WAS ` 28,20,180/-. THERE WAS NO EXPLANATION FOR THIS EXCESS OPENING BALANCE IN THE ASSESSEES CAPITAL ACCOUNT TO THE TUNE OF ` 13,73,580/-. ACCORDINGLY, THE ASSESSMENT WAS COMPLETED BY ADDING THE EXCESS OPENI NG BALANCE OF ` 13,73,580/- AND UNEXPLAINED CASH CREDITS OF ` 1,11,29,500/-. THE TOTAL INCOME WAS THUS REVISED T O ` 1,27,03,780/- AS UNDER : ITA NO.2079/MDS/2012 & C.O. NO. 204/MDS/2012 : 4 : 1. TOTAL INCOME ADMITTED ` 2,00,700 2. ADD EXCESS OPENING BALANCE ` 13,73,580 3. UNEXPLAINED CASH CREDITS AS DISCUSSED ABOVE ` 1,11,29,500 REVISED TOTAL INCOME ` 1,27,03,780 3. THE ASSESSEE CARRIED THE MATTER IN APPEAL BEFORE THE CIT(APPEALS). BEFORE THE CIT(APPEALS) THE ASSESSEE FURNISHED REVISED CAPITAL ACCOUNT AND BALANCE SHEET OF THE AS SESSEE. THE CIT(APPEALS) AFTER PERUSING THE DETAILS SUBMITT ED BY THE ASSESSEE OBSERVED THAT AS PER THE REVISED CAPITAL A CCOUNT AND THE BALANCE SHEET, INVESTMENT IN CHENNAI RESIDENTIA L PROPERTY AND THE SOURCES OF INVESTMENT OF ` 50 LAKHS FROM SHRI M.Y. ZAFARULLA, FATHER OF THE ASSESSEE AND ` 6 LAKHS FROM SMT. GULSHAM NIGAR, MOTHER OF THE ASSESSEE WERE FOUND RE FLECTED IN THE BALANCE SHEET AS ON 31.03.2004. SINCE THE INVE STMENT IN THE RESIDENTIAL PROPERTY AT CHENNAI MUCH EARLIER TO ASSESSMENT YEAR 2006-07, NO ADDITION ON ACCOUNT OF UNEXPLAINED CREDIT IN RESPECT OF SOURCE FOR SUCH INVESTMENT COULD BE MADE FOR ASSESSMENT YEAR 2006-07 AND HENCE THE ADDITION OF ` 56 LAKHS WAS DELETED BY THE CIT(APPEALS). 4. ON BEING AGGRIEVED, THE REVENUE HAS CARRIED THE MATTER BEFORE THE TRIBUNAL. THE LEARNED DR SUPPORTED THE ORDER PASSED BY THE ASSESSING OFFICER. ITA NO.2079/MDS/2012 & C.O. NO. 204/MDS/2012 : 5 : 5. ON THE OTHER HAND, THE LEARNED COUNSEL FOR THE A SSESSEE SUBMITTED THAT THE ASSESSEE HAS RECEIVED ` 50 LAKHS FROM HER FATHER AND ` 6 LAKHS FROM HER MOTHER. THIS IS VERY CLEAR FROM THE RETURNS FILED BY THE ASSESSEE FOR THE ASSESSMEN T YEARS 2001-02 AND 2002-03. THE ASSESSEE HAS NOT BORROWED ANY AMOUNT FROM HER FATHER AND MOTHER IN THE YEAR UNDER CONSIDERATION. THEREFORE, THE ADDITION MADE U/S 68 OF THE ACT CANNOT SURVIVE FOR THIS YEAR. 6. WE HAVE HEARD BOTH THE SIDES, PERUSED THE RECORD S AND GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW. IN THE ASSESSMENT ORDER THE ASSESSING OFFICER HAS ASSESSED THE INCOME OF THE ASSESSEE AT ` , 1,27,03,780/-. HOWEVER, IN APPEAL THE CIT(APPEALS) DELETED SOME AMOUNTS AND ADDED SOM E AMOUNTS. THE REVENUE HAS FILED THE PRESENT APPEAL ONLY WITH REGARD TO THE ADDITION OF ` 56,00,000/- MADE BY THE ASSESSING OFFICER UNDER SECTION 68 OF THE ACT. THE CASE OF TH E ASSESSING OFFICER IS THAT THE ASSESSEE HAS RECEIVED ` 50 LAKHS FROM HER FATHER AND ` 6 LAKHS FROM HER MOTHER AND BOTH THE FATHER AND MOTHER HAVE NOT EXPLAINED THE SOURCES AND THEIR CAP ACITY WAS ALSO DOUBTED. ACCORDINGLY, THE ASSESSING OFFICER A DDED THE SAME AS INCOME OF THE ASSESSEE. IN APPEAL, THE CIT (APPEALS) OBSERVED THAT THE ASSESSING OFFICER HAS MADE THE AD DITION OF ` ITA NO.2079/MDS/2012 & C.O. NO. 204/MDS/2012 : 6 : 1,11,29,500/- TOWARDS UNEXPLAINED CASH CREDITS. THE ASSESSEE HAS ADMITTED INVESTMENT IN THE IMMOVABLE PROPERTIES TO THE TUNE OF ` 1.32 CRORES AS PER THE BALANCE SHEET AS ON 31.3.2006. A PERUSAL OF THE COPY OF THE SALE DEEDS DATED 28.8.2000 AND 22.6.2001 REVEALS THAT THE SELF-OCCUP IED RESIDENTIAL PROPERTY AT NEW NO. 25/10 PASUMARTHI S TREET, II LANE, UNITED INDIA COLONY, KODAMBAKKAM, CHENNAI-6 00 024 WAS BOUGHT BY WAY OF TWO DOCUMENTS FOR A REGISTERED SALE CONSIDERATION AT ` 22,20,000/- EACH. THE ENTIRE INVESTMENT IN THE RESIDENTIAL PROPERTY WAS MADE DURING THE YEARS 2001-02 AND 2002-03, I.E. PRIOR TO THE ASSESSMENT YEAR 2006 -07. CONSEQUENTLY, THE SOURCE FOR SUCH INVESTMENT IN THE RESIDENTIAL PROPERTY WILL BE OUTSIDE THE PURVIEW OF THE ASSESSM ENT YEAR 2006-07. EVEN THE CIT(APPEALS) GAVE A FURTHER FIND ING THAT AS PER THE COPIES OF THE REVISED CAPITAL ACCOUNT AND T HE BALANCE SHEET, INVESTMENT IN CHENNAI RESIDENTIAL PROPERTY A ND SOURCE OF INVESTMENT, I.E. LOANS OF ` 50 LAKHS FROM FATHER OF THE ASSESSEE AND ` 6 LAKHS FROM MOTHER OF THE ASSESSEE WERE FOUND REF LECTED IN THE BALANCE SHEET AS ON 31.3.2004. SO THE INVESTMENT IN THE RESIDENTIAL PROPERTY HAD TAKEN PLACE MUCH EARLIER T O ASSESSMENT YEAR 2006-07 AND THEREFORE NO ADDITION C AN BE MADE IN THE ASSESSMENT YEAR 2006-07. WE FIND FROM THE ORDER ITA NO.2079/MDS/2012 & C.O. NO. 204/MDS/2012 : 7 : OF THE CIT(APPEALS) THAT THE CIT(APPEALS) AFTER EXA MINING THE ENTIRE DETAILS INCLUDING THE TWO SALE DEED DATED 28 .8.2000 AND 22.6.2001 HAS COME TO THE CONCLUSION THAT THE INVES TMENT MADE BY THE ASSESSEE AND THE SOURCE OF THE INVESTME NT DO NOT COME WITHIN THE PURVIEW OF THE ASSESSMENT YEAR 2006 -07 AND THE ADDITION WAS DELETED. WE FIND NO REASON TO INT ERFERE WITH THE ORDER PASSED BY THE CIT(APPEALS). ACCORDINGLY, WE UPHOLD THE ORDER OF THE CIT(APPEALS) AND DISMISS THE GROUN D RAISED BY THE REVENUE. 7. THE CROSS OBJECTION FILED BY THE ASSESSEE MERELY SUPPORTS THE ORDER PASSED BY THE CIT(APPEALS). THEREFORE TH E CROSS OBJECTION HAS BECOME INFRUCTUOUS AND AS SUCH THE SA ME IS DISMISSED AS INFRUCTUOUS. 8. IN THE RESULT, BOTH THE APPEAL FILED BY THE REVE NUE AND THE CROSS OBJECTION FILED BY THE ASSESSEE ARE DISMISSED . ORDER PRONOUNCED ON MONDAY, THE 6 TH OF MAY, 2013, AT CHENNAI. SD/- (N. S. SAINI) SD/- (V.DURGA RAO) ACCOUNTANT MEMBER JUDICIAL MEMBER CHENNAI, DATED THE 6 TH MAY, 2013. H. COPY TO: ASSESSEE/AO/CIT(A)/CIT/D.R./GUARD FILE