The ITO, Ward-2, Vapi V. Shri Piyush D. Desai, Vapi

ITA 212/AHD/2016

• Counselvise Citation: [2018] 118 COUNSELVISE.COM (IT) 2293 (ITAT-SURAT)
• Duration Of Justice: 2 year(s) 4 month(s) 20 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-06-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2006-2007
• Appeal Filed On: 29-01-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: J K CHANDNANI
• Section: 131; 148; 143(3); 143(1)

Judgement Text

ITO, WARD.2,VAPI V. SHRI PIYUSH D.DESAI/ I.T.A. NO.212/AHD/2016/06-07 PAGE 1 OF 6 , , IN THE INCOME TAX APPELLATE TRIBUNAL SURAT BENCH, SURAT . . , . . , BEFORE SHRI C.M.GARG, JUDICIAL MEMBER AND SHRI O.P.MEENA, ACCOUNTANT MEMBER . . ./ I.T.A NO. 212/AHD/2016/SRT / ASSESSMENT YEAR :2006-07 INCOME - TAX OFFICER, WARD.2, VAPI. V S . SHRI PIYUSH D. DESAI, C/O. DESAI AUTOMOBILES PVT. LTD., NEAR HOTEL WOODLANDS, N.H. NO.8, BALITHA, VAPI-396 195. PAN: ABIPD 1955G APPELLANT /RESPONDENT /ASSESSEE BY SHRI KAMLESH BHATT, C.A. /REVENUE BY SHRI J.K. CHANDNANI, SR. DR / DATE OF HEARING: 19.06. 2018 /PRONOUNCEMENT ON 28 .06.2018 /O R D E R PER O. P. MEENA, ACCOUTANT MEMBER: 1. THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF LEARNED COMMISSIONER OF INCOME TAX (APPEAL), VALSAD (IN SHORT THE CIT(A) ) DATED 02.11.2015 FOR THE A.Y. 2006-07 IN THE MATTER OF ASSESSMENT ORDER U/S. 143(3) R.W.S. 147 OF THE ACT. ( IN SHORT ACT) DTD. 18.03.2014 PASSED BY THE INCOME-TAX OFFICER, WARD.2, VAPI ( IN SHORT THE A.O). ITO, WARD.2,VAPI V. SHRI PIYUSH D.DESAI/ I.T.A. NO.212/AHD/2016/06-07 PAGE 2 OF 6 2. GROUNDS OF APPEAL ARE AS UNDER : 1) ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE CIT (A), HAS ERRED IN DELETING THE ADDITION OF RS.47,60,800/- U/S.69A OF THE I.T. ACT WITHOUT APPRECIATING THE LEGAL AND FACTUAL MATRIX BROUGHT OUT BY THE ASSESSEE, 2) ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE CIT (A) , HAS ERRED IN HOLDING THAT NO ADDITION ON ACCOUNT OF UNEXPLAINED CASH DEPOSIT CAN BE MADE IN THE HAND OF ONE OF THE JOINT HOLDERS AGAINST WHOM NO EVIDENCE OF EARNING INCOME OUTSIDE THE BOOKS OF ACCOUNTS HAS BEEN BROUGHT FORTH , WITHOUT APPRECIATING THE LEGAL REQUIREMENT THAT THE ONUS IS ON THE ASSESSEE AND NOT ON THE DEPARTMENT TO PROVE OR EXPLAIN THE SOURCE OF CASH DEPOSIT MADE IN THE JOINT ACCOUNT. 3) ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE CIT(A) , HAS ERRED IN NOT APPRECIATING THAT IN JOINT ACCOUNT BOTH THE ACCOUNT HOLDERS ARE JOINTLY RESPONSIBLE FOR ALL THE TRANSACTIONS CARRIED OUT THROUGH SUCH ACCOUNTS AND IN THE CASE UNDER CONSIDERATION, THE WIFE OF THE ASSESSEE HAD FAILED TO EXPLAIN THE SOURCE OF SUCH CASH DEPOSIT AND THEREFORE, THE ONUS WAS ON THE ASSESSEE TO SATISFACTORY EXPLAIN THE SAME. 3. SINCE, THE ABOVE GROUNDS OF APPEAL ARE INTER-CONNECTED AND RELATES TO DELETION OF ADDITION OF SEC.69A OF THE ACT, SAME ARE BEING CONSIDERED TOGETHER. 4. BRIEF FACTS ARE THAT THE ASSESSEE HAS FILED RETURN OF INCOME ON 31.07.2007 DECLARING TOTAL INCOME OF RS.2,83,248/- WHICH WAS PROCESSED U/S. 143(1) OF THE ACT. SUBSEQUENTLY, NOTICE U/S. 148 WAS ISSUED AND CONSEQUENTLY ASSESSMENT WAS MADE U/S. 143(3) ITO, WARD.2,VAPI V. SHRI PIYUSH D.DESAI/ I.T.A. NO.212/AHD/2016/06-07 PAGE 3 OF 6 R.W.S. 147 OF THE ACT BY DETERMINING TOTAL INCOME OF RS.50,44,050/- BY MAKING AN ADDITION OF RS.47,60,800/- ON ACCOUNT OF UNEXPLAINED MONEY U/S. 69A OF THE ACT. 5. AGGRIEVED BY THE ORDER OF THE A.O., THE ASSSESSEE FILED AN APPEAL BEFORE THE CIT(A). THE CIT (A) NOTED THAT THERE ARE TWO BANK ACCOUNTS IN WHICH THE ASSESSEE AND HIS WIFE ARE THE JOINT HOLDER. AT THE TIME OF INQUIRY BY THE A.O. AS TO THE SOURCE OF CASH DEPOSITS MADE IN THESE TWO ACCOUNTS AMOUNTING TO RS.47,60,800/, THE ASSESSEE HAS SUBMITTED THAT HE HAS NOTHING TO DO WITH THE CASH DEPOSIT AND ALL THE DEPOSITS BELONG TO HIS WIFE WHO HAS REFLECTED THESE ACCOUNTS IN THE RETURN OF INCOME AND IN BOOKS OF ACCOUNTS PRODUCED BEFORE THE A.O. THE A.O. DISBELIEVED THAT THE CASH DEPOSITS CANNOT BELONG TO THE SPOUSE OF THE APPELLANT BECAUSE SHE HAS NOT BEEN ABLE TO EXPLAIN THE SOURCE OF CASH DEPOSITS . THE CIT (A) OBSERVED THAT IF TRANSACTION IN THE ACCOUNT ARE UNEXPLAINED BUT HE IS ABLE TO EXPLAIN THE SOURCE OF THE FUND SHOULD HAVE BEEN MADE IN HIS WIFES THE ASSESSEE. IN THE PRESENT CASE, THE A.O. HAS NOT BROUGHT INTO RECORD THAT THE APPELLANT BEING SECOND HOLDER, THE ADDITION SHOULD BE MADE IN HIS HAND. FURTHER, ON THE OTHER HAND , NO ADDITION IS BEING MADE IN THE HANDS OF THE WIFE, WHO HAS REFLECTED THIS AMOUNT IN THE RETURN OF INCOME BUT IS UNABLE TO ITO, WARD.2,VAPI V. SHRI PIYUSH D.DESAI/ I.T.A. NO.212/AHD/2016/06-07 PAGE 4 OF 6 EXPLAIN THE SOURCE. THE CIT (A) FURTHER OBSERVED THAT AS PER THE SUBMISSION OF THE APPELLANT, ON THE IDENTICAL FACTS IN THE CASE OF APPELLANT WIFE NO ADDITION HAS BEEN MADE BY THE A.O. IN VIEW OF THESE FACTS AND CIRCUMSTANCES, THE CIT (A) WAS OF THE VIEW THAT, THE A.O. SHOULD HAVE MADE THE ADDITION IN THE HANDS OF THE WIFE OF THE APPELLANT IN WHICH UNEXPLAINED CASH DEPOSIT OF RS.47,60,800/- BELONGS. THEREFORE, THE ADDITION MADE BY THE A.O. IN HANDS OF THE ASSESSEE AT RS.47,60,800/- U/S. 69 OF THE ACT WAS DELETED. 6. BEING AGGRIEVED, THE REVENUE HAS FILED THIS APPEAL BEFORE THE TRIBUNAL. THE LEARNED SR. D.R. SUBMITTED THAT THE WIFE OF THE APPELLANT HAS NO SOURCE OF INCOME, AND ONLY COMMISSION INCOME AT RS.9,13,355/- IS SHOWN. BESIDES, THIS , SHE IS NOT ABLE TO EXPLAIN THE SOURCE OF CASH DEPOSIT IN HER ACCOUNT DURING THE COURSE OF STATEMENT U/S. 131 RECORDED FROM HER. IN HER STATEMENT, SONAL P. DESAI STATED THAT HOW THE RECORDS PERTAINING TO A.Y. 2006-07. SHE HAS ALSO EXPRESSED HER INABILITY OF WITHDRAWALS PERTAINING TO THE SAID BANK ACCOUNT. THE ONLY REASON WHICH SUPPORTS THAT OWNER OF THE MONEY IS SONAL P. DESAI BECAUSE AS SHE IS FIRST HOLDER OF BANK ACCOUNT WHICH HAS BEEN SHOWN IN HER BALANCE SHEET. MERELY SHOWN THE BANK ACCOUNT IN HIS WIFES BOOKS OF ACCOUNT DOES NOT MEAN THAT ITO, WARD.2,VAPI V. SHRI PIYUSH D.DESAI/ I.T.A. NO.212/AHD/2016/06-07 PAGE 5 OF 6 THE ENTIRE CASH DEPOSITED BELONG TO HER IN A.Y. 2006-07, AS SHE HAS SHOWN ONLY COMMISSION INCOME WHICH SHE RECEIVED BY CHEQUE ONLY. THEREFORE, IT WAS CONTENDED THAT THE CIT (A) IN SHOULD HAVE HELD THE ADDITION MADE IN THE HANDS OF THE ASSESSEE. 7. PER CONTRA, THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE ASSESSEE IS SECOND HOLDER OF BANK ACCOUNT WHEREAS ACCOUNTS ARE SHOWN IN THE NAME OF SONAL P. DESAI FIRST HOLDER THUS, BANK ACCOUNT WITH UTI AND AXIS BANK HAVE BEEN DISCLOSED IN HER BALANCE SHEET AS PAPER BOOK PAGE 1 . THEREFORE, THE CIT (A) HAS CORRECTLY DELETED THE ADDITION AS UNEXPLAINED DEPOSIT WHICH SHOULD HAVE BEEN CONSIDERED AND FOUND UNEXPLAINED SHOULD HAVE BEEN IN THE HANDS OF THE SPOUSE OF THE ASSESSEE. ACCORDINGLY, THE LEARNED COUNSEL HAS STRONGLY PLACE RELYING ON THE ORDER OF CIT(A). 8. WE HAVE HEARD RIVAL SUBMISSION AND PERUSED THE MATERIAL ON RECORD. IT IS UNDISPUTED FACT THAT THE BANK ACCOUNT WITH UTI AND AXIS BANK ARE OPEN IN THE NAME OF SONAL P. DESAI AS FIRST HOLDER OF THE SAID BANK ACCOUNT . IT IS ALSO TRUE THAT SHE HAS DISCLOSED THE SAID BANK ACCOUNT IN HIS RETURN OF INCOME AND BALANCE SHEET. THEREFORE, THE SOURCE OF CASH DEPOSITS APPEARING THEREIN IS REQUIRED TO BE CONSIDERED IN THE CASE OF SMT. SONAL P. DESAI, IF IT IS FOUND AS UNEXPLAINED. WE ALSO OBSERVED THAT DURING THE COURSE ITO, WARD.2,VAPI V. SHRI PIYUSH D.DESAI/ I.T.A. NO.212/AHD/2016/06-07 PAGE 6 OF 6 OF STATEMENT RECORDED U/S. 131 OF THE ACT SMT. SONAL DESAI ADMITTED THE SAID CASH AS BELONGING TO HER THOUGH SHE COULD NOT EXPLAIN THE SAME PROPERLY. THEREFORE, WE FIND NO FAULT IN THE ORDER OF LEARNED CIT (A) IN RELATION TO THE CASH DEPOSIT APPEARING IN THE BANK ACCOUNTS BELONGING TO THE WIFE OF THE ASSESSEE. THE CIT(A) HAS RIGHTLY OBSERVED THAT THE A.O. CONSIDERED THE DEPOSITS AS UNEXPLAINED BUT NOT MAKING THE ADDITION IN THE SPOUSE OF THE ASSESSEE. THEREFORE, IN SUCH VIEW, THE A.O. COULD HAVE CONSIDERED THE SAME IN THE CASE OF HER SPOUSE. IN VIEW OF THIS MATTER, THE APPEAL FILED BY THE REVENUE IN THE GROUND NO.1 TO 3 ARE ACCORDINGLY DISMISSED. 9. IN THE RESULT, APPEAL OF THE REVENUE IS DISMISSED. 10. ORDER PRONOUNCED IN OPEN COURT ON 28.06.2018. SD/- SD/- ( . . /C.M. GARG) ( . . /O.P.MEENA) /JUDICIAL MEMBER /ACCOUNTANT MEMBER SURAT, DATED : 28.06.2018 / COPY OF THE ORDER IS FORWARDED TO : 1. / THE APPELLANT; 2. / THE RESPONDENT; 3. ) ( / THE CIT(A), 4. PR. CIT 5. , , / DR, ITAT, SURAT; 6. / GUARD FILE. BY ORDER / / TRUE COPY / / ASSISTANT REGISTRAR, SURAT BVC