ITO, Tuticorin V. N.Sureshkumar, Tuticorin

ITA 2150/CHNY/2015

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 8648 (ITAT-CHENNAI)
• Duration Of Justice: 9 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-08-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2009-2010
• Appeal Filed On: 16-11-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: P RADHAKRISHNAN

Judgement Text

, / , IN THE INCOME TAX APPELLATE TRIBUNAL A / SMC BENCH, CHENNAI ... , BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER ./ ITA NO. 2150/MDS/2015 ' #$' / ASSESSMENT YEAR : 2009-10 THE INCOME TAX OFFICER, WARD 4, 6T, NORTH COTTON ROAD, TUTICORIN. V. SHRI N. SURESHKUMAR, 11-D, SECOND STREET, MEENAKSHIPURAM, TUTICORIN 628 002. PAN : CQDPS 3386 L (&'/ APPELLANT) (()&'/ RESPONDENT) &' * + / APPELLANT BY : SH. P. RADHAKRISHNAN, JCIT ()&' * + / RESPONDENT BY : SH. SAROJ KUMAR PARIDA, ADVOCATE , # * -. / DATE OF HEARING : 13.06.2016 /0$ * -. / DATE OF PRONOUNCEMENT : 18.08.2016 / O R D E R THIS APPEAL OF THE REVENUE IS DIRECTED AGAINST TH E ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS) 1, MADUR AI, DATED 05.08.2015 AND PERTAINS TO ASSESSMENT YEAR 2009-10. 2. SH. P. RADHAKRISHNAN, THE LD. DEPARTMENTAL REPRE SENTATIVE, SUBMITTED THAT THE ONLY ISSUE ARISES FOR CONSIDERAT ION IS WITH REGARD TO THE ADDITION OF ` 40 LAKHS SAID TO BE ADVANCED BY THE ASSESSEE TO 2 I.T.A. NO.2150/MDS/15 ONE SHRI A. BHASKARAN. ACCORDING TO THE LD. D.R., THE ASSESSEE FILED A CIVIL SUIT BEFORE THE PRINCIPAL DISTRICT JU DGE AT TUTICORIN IN OS NO.1 OF 2011 FOR RECOVERY OF A SUM OF ` 40 LAKHS SAID TO BE ADVANCED AS HAND LOAN ON 20.03.2009. THE ASSESSEE EXPLAINED BEFORE THE ASSESSING OFFICER THAT HIS INCOME FROM A GRICULTURE WAS ` 40 LAKHS. MOREOVER, ACCORDING TO THE LD. D.R., ONE SHRI MURUGAIAH ADVANCED A SUM OF ` 40 LAKHS TO THE ASSESSEE. THE SAID SHRI MURUGAIAH EXPLAINED BEFORE THE ASSESSING OFFICER TH AT HE WAS OWNING 16 ACRES OF LAND AND CULTIVATING THE SAME SI NCE 2000. AFTER CONSIDERING THE MATERIAL PRODUCED BY THE ASSESSEE, THE ASSESSING OFFICER FOUND THAT IT IS BEYOND ANYBODYS IMAGINATI ON THAT THE ASSESSEE HAS RECEIVED ` 40 LAKHS FROM SHRI MURUGAIAH. 3. THE LD. DEPARTMENTAL REPRESENTATIVE FURTHER SUBM ITTED THAT THE CLAIM OF THE ASSESSEE THAT A SUM OF ` 40 LAKHS WAS PAID TO SHRI SURESH KUMAR IN CASH ON 20.03.2009 AT THE INSTANCE OF HIS BROTHER SHRI JAGADEESAN AND HE HAD NOT DEMANDED ANY INTERES T FOR ADVANCE OF ` 40 LAKHS WAS NOT BELIEVED BY THE ASSESSING OFFICER. ACCORDING TO THE LD. D.R., THE INCOME FROM THE ASSE SSEES BUSINESS IS VERY MEAGRE AND IT IS NOT SUFFICIENT TO MAINTAIN EVEN HIS FAMILY, THEREFORE, THE ASSESSEE COULD NOT HAVE RECEIVED A S UM OF ` 40 LAKHS 3 I.T.A. NO.2150/MDS/15 FROM AND OUT OF HIS BUSINESS ACTIVITY. ACCORDING T O THE LD. D.R., SINCE THE CLAIM OF THE ASSESSEE THAT HE RECEIVED A SUM OF ` 40 LAKHS FROM SHRI MURUGAIAH WAS NOT SUBSTANTIATED, THE ASSE SSING OFFICER FOUND THAT THE ABOVE SAID SUM OF ` 40 LAKHS IS ASSESSEES OWN MONEY. ACCORDINGLY, THE SAME WAS ASSESSED. HOWEVE R, ACCORDING TO THE LD. D.R., ON APPEAL, THE CIT(APPEALS) DELETE D THE ADDITION MADE BY THE ASSESSING OFFICER ON THE GROUND THAT IN THE CASE OF SHRI MURUGAIAH, THIS TRIBUNAL FOUND THAT THE SAID S HRI MURUGAIAH WAS HAVING ADEQUATE AGRICULTURAL INCOME TO EXPLAIN THE ADVANCE OF ` 40 LAKHS TO THE ASSESSEE. ACCORDING TO THE LD. D.R ., SHRI MURUGAIAH IS A SMALL TIME AGRICULTURIST, THEREFORE, HE WOULD NOT HAVE MADE ANY ADVANCE TO THE ASSESSEE. 4. ON THE CONTRARY, SH. SAROJ KUMAR PARIDA, THE LD. COUNSEL FOR THE ASSESSEE, SUBMITTED THAT ADMITTEDLY THE ASSESSE E FILED CIVIL SUIT BEFORE THE PRINCIPAL DISTRICT JUDGE AT TUTICORIN FO R RECOVERY OF SUM OF ` 40 LAKHS FROM SHRI A. BHASKARAN. THE ASSESSING OF FICER FOUND THAT THE ASSESSEE HAS NO SOURCE FOR ADVANCING OF ` 40 LAKHS TO SHRI A. BHASKARAN. THE ASSESSEE EXPLAINED BEFORE THE AS SESSING OFFICER THAT THE SUM OF ` 40 LAKHS WAS BORROWED FROM SHRI MURUGAIAH. THIS AMOUNT OF ` 40 LAKHS BORROWED FROM SHRI 4 I.T.A. NO.2150/MDS/15 MURUGAIAH WAS VERY MUCH AVAILABLE WITH THE ASSESSEE . THEREFORE, THE ASSESSING OFFICER CANNOT DOUBT THE SOURCE FOR M AKING ADVANCE TO SHRI A. BHASKARAN. REFERRING TO THE ORDER OF TH IS TRIBUNAL IN THE CASE OF SHRI MURUGAIAH IN I.T.A. NO. 12/MDS/2015 DA TED 01.04.2016, THE LD.COUNSEL FOR THE ASSESSEE SUBMITT ED THAT SHRI MURUGAIAH WAS HAVING OPENING BALANCE OF ` 44,26,495/-. SHRI MURUGAIAH CLAIMED THE SAME BEFORE THE ASSESSING OFF ICER AS HIS AGRICULTURAL INCOME. HOWEVER, THE ASSESSING OFFICE R TREATED 25% OF THE SAME AS AGRICULTURAL INCOME AND THE BALANCE WAS TREATED AS INCOME FROM BUSINESS. WHEN THE MATTER TRAVELLED BE FORE THIS TRIBUNAL, THIS TRIBUNAL FOUND THAT 50% OF THE OPENI NG CAPITAL BALANCE WAS FROM AGRICULTURAL INCOME AND THE BALANCE OF 50% HAS TO BE TREATED AS INCOME FROM BUSINESS. THEREFORE, IT IS OBVIOUS THAT SHRI MURUGAIAH WAS HAVING ` 44,26,495/- AS OPENING CAPITAL BALANCE IN THE ASSESSMENT YEAR 2009-10. IN VIEW OF THIS FINDI NG OF THE TRIBUNAL IN THE CASE OF SHRI MURUGAIAH IN I.T.A. NO. 12/MDS/ 2015 DATED 01.04.2016, THE CLAIM OF THE ASSESSEE THAT HE RECEI VED ` 40 LAKHS FROM SHRI MURUGAIAH CANNOT BE REJECTED ON THE GROUN D THAT SHRI MURUGAIAH HAD NO SOURCE FOR ADVANCING THE SUM OF ` 40 LAKHS. 5. I HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EITHE R SIDE AND PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. THE ASSESSEE 5 I.T.A. NO.2150/MDS/15 CLAIMED BEFORE THE ASSESSING OFFICER THAT ONE SHRI MURUGAIAH ADVANCED A SUM OF ` 40 LAKHS TO THE ASSESSEE AND THE SAID SHRI MURUGAIAH ALSO HAS AGRICULTURAL INCOME TO THE EXTEN T OF ` 40 LAKHS. THE CLAIM OF SHRI MURUGAIAH WAS DOUBTED BY THE ASSE SSING OFFICER ON THE GROUND THAT THERE WAS NO SOURCE FOR MAKING I NVESTMENT. ACCORDINGLY, THE ASSESSING OFFICER TREATED 25% OF T HE AMOUNT CLAIMED BY SHRI MURUGAIAH AS FROM AGRICULTURAL INCO ME AND REMAINING 75% WAS TAKEN AS INCOME FROM OTHER SOURCE S. WHEN THE MATTER CAME BEFORE THIS TRIBUNAL, THIS TRIBUNAL FOU ND THAT 50% OF INCOME HAS TO BE TREATED AS AGRICULTURAL INCOME AND REMAINING 50% AS INCOME FROM BUSINESS. NOW THE ASSESSEE CLAIMS T HAT THE SOURCE OF SHRI MURUGAIAH WAS ESTABLISHED BEYOND DOUBT FOR ADVANCING MONEY TO THE EXTENT OF ` 40 LAKHS. THIS TRIBUNAL IN I.T.A. NO. 12/MDS/2015 DATED 01.04.2016 EXAMINED THE APPEAL OF SHRI MURUGAIAH AND FOUND THAT SHRI MURUGAIAH HAS AGRICUL TURAL INCOME AND INCOME FROM OTHER SOURCES TO THE EXTENT OF ` 44,26,495/- AS OPENING CAPITAL BALANCE FOR THE ASSESSMENT YEAR 200 9-10. SINCE THE SOURCE OF SHRI MURUGAIAH WAS ESTABLISHED, THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT THE ASSESSEES CLAIM THAT H E RECEIVED ` 40 LAKHS FROM SHRI MURUGAIAH HAS TO BE ACCEPTED. THE REFORE, THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT THE CIT( APPEALS) HAS 6 I.T.A. NO.2150/MDS/15 RIGHTLY DELETED THE ADDITION MADE BY THE ASSESSING OFFICER. THIS TRIBUNAL DO NOT FIND ANY REASON TO INTERFERE WITH T HE ORDER OF THE LOWER AUTHORITY AND ACCORDINGLY THE SAME IS CONFIRM ED. 6. IN THE RESULT, THE APPEAL FILED BY THE REVENUE I S DISMISSED. ORDER PRONOUNCED ON 18 TH AUGUST, 2016 AT CHENNAI. SD/- ( ... ) (N.R.S. GANESAN) /JUDICIAL MEMBER /CHENNAI, 2 /DATED, THE 18 TH AUGUST, 2016. KRI. * (-34 54$- /COPY TO: 1. &' /APPELLANT 2. ()&' /RESPONDENT 3. , 6- () /CIT(A)-1, MADURAI 4. PRINCIPAL CIT-1, MADURAI 5. 4#7 (- /DR 6. 8' 9 /GF.