The ITO, Dhar V. Shri Rajendra Kumar Gupta, Dhar

ITA 221/IND/2017

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 0574 (ITAT-INDORE)
• Duration Of Justice: 1 year(s) 5 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-09-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 10-09-2018
• Assessment Year: 2013-2014
• Appeal Filed On: 21-03-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: P K MITRA
• Assessee Lawyers: S N AGRAWAL
• Section: 143(3); 69

Judgement Text

RAJENDRA KUMAR GUPTA I.T.A. NO. 221/IND/17 , , IN THE INCOME TAX APPELLATE TRIBUNAL INDORE BENCH, INDORE BEFORE SHRI KUL BHARAT, JUDICIAL MEMBER AND SHRI MANISH BORAD, ACCOUNTANT MEMBER ITA NO.221/IND/2017 ASSESSMENT YEAR:2013-14 INCOME TAX OFFICER, DHAR (M.P) / VS. SHRI RAJENDRA KUMAR GUPTA, 17, SARDAR PATEL MARG, KUKSHI, DHAR (M.P) (REVENUE) (RESPONDENT ) P.A. NO. AADCD3053E REVENUE BY SHRI P.K.MI T RA , SR. DR RESPONDENT BY SHRI S.N. AGRAWAL , CA DATE OF HEARING: 10.09.2018 DATE OF PRONOUNCEMENT: 19.09.2018 / O R D E R PER MANISH BORAD, A.M: THIS APPEAL FILED AT THE INSTANCE OF REVENUE PERTAI NING TO A.Y. 2013-14 IS DIRECTED AGAINST THE ORDER OF LD. COMMIS SIONER OF INCOME TAX(APPEALS)-III, INDORE, (IN SHORT CIT(A) ), VIDE APPEAL NO. IT-71/16-17 ORDER DATED 16.12.2016 WHICH IS ARISING OUT OF THE ORDER U/S 143(3) OF THE INCOME TAX ACT 1961(HEREINA FTER CALLED AS THE ACT) FRAMED ON 22.03.2016 BY ITO, DHAR. RAJENDRA KUMAR GUPTA I.T.A. NO. 221/IND/17 2 2. BRIEFLY STATED FACTS AS CULLED OUT FROM THE RECO RDS ARE THAT THE ASSESSEE IS THE PRESIDENT OF M/S. LAXMI SAKH SAHAKA RITA MARYADIT SOCIETY, KUKSHI REGISTERED UNDER THE MADHYA PRADESH SAHAKARI SOCIETY (AMENDMENT) ACT, 2012. A PRIVATE LIMITED CO MPANY ENGAGED IN THE ACTIVITY OF CIVIL CONSTRUCTION, PURC HASE AND SALE OF IMMOVEABLE PROPERTY. HIS SOURCE OF INCOME WAS FROM LEGAL PRACTICE AND OTHER SOURCES. INCOME OF RS.3,29,930/- DISCLOSE D IN THE INCOME TAX RETURN FILED ON 14.6.2014. CASE SELECTED FOR SC RUTINY THROUGH CASS. ACCORDINGLY NOTICES U/S 143(2)/142(1) DULY S ERVED UPON THE ASSESSEE ALONG WITH QUESTIONNAIRE. ON THE BASIS OF THE INFORMATION RECEIVED BY THE ASSESSING OFFICER FROM THE CIB DUE TO WHICH THE CASE WAS SELECTED FOR SCRUTINY UNDER CASS. THE LD. A.O OBSERVED THAT CASH EXCEEDING RS.10 LAKH HAVE BEEN DEPOSITED IN THE SAVING BANK ACCOUNT IN THE NAME OF THE ASSESSEE AND FURTHE R INVESTIGATION IT IS REVEALED THAT ON VARIOUS DATES SUM OF RS.52,9 5,000/- HAS BEEN DEPOSITED AS CASH AND PROCEEDS FROM FIXED DEPOSIT R ECEIPTS OF RS.55,42,838/- WERE FOUND IN THE SAID ACCOUNT WHICH WAS EXPLAINED BY THE ASSESSEE THAT BOTH BELONGS TO CASH DEPOSIT AS WELL AS THE PROCEEDS FROM FIXED DEPOSITS ARE OF THE SOCI ETY M/S. LAKSHMI RAJENDRA KUMAR GUPTA I.T.A. NO. 221/IND/17 3 SAKH SAHAKARITA MARYADIT SOCIETY, KUKSHI AND NOT AT ALL RELATED TO THE ASSESSEE. IT WAS ALSO PLEADED THAT AS THE PERM ANENT ACCOUNT NO. WAS NOT ALLOTTED TO THE SOCIETY AT THAT POINT O F TIME, THEREFORE THE ALLEGED SUM WAS BEING REFLECTED IN THE NAME OF THE ASSESSEE BECAUSE THE PAN NUMBER OF THE PRESIDENT I.E. ASSESS EE WAS GIVEN WITH THE BANK AUTHORITIES. 3. THE LD.A.O DOUBTED THE EXISTENCE OF THE SOCIETY AND MADE ADDITION OF RS.1,08,37,838/- (RS.52,95,000/- + RS.5 5,42,838/-) TO THE INCOME OF THE ASSESSEE THEREBY ASSESSING THE IN COME AT RS.1,11,67,768/-. 4. AGGRIEVED ASSESSEE PREFERRED APPEAL BEFORE THE L D.CIT(A) AND SUCCEEDED IN CONVINCING THE LD.CIT(A) THAT THE ALLE GED SUM OF CASH DEPOSITED AS WELL AS PROCEEDS FROM FIXED DEPOSITS A RE NOT RELATED TO THE ASSESSEE BUT THEY BELONG TO THE SOCIETY M/S LAKSHMI SAKH SAHAKARITA MARYADIT WHEREIN ALL THE ALLEGED TRANSAC TIONS HAVE BEEN DULY REPORTED. LD.CIT(A) DELETED ALL THE ADDITIONS . 5. NOW THE REVENUE IS IN APPEAL BEFORE THE TRIBUNAL RAISING FOLLOWING GROUNDS; WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF T HE CASE, THE LD. CIT(A) ERRED IN :- RAJENDRA KUMAR GUPTA I.T.A. NO. 221/IND/17 4 1. DELETING THE ADDITION OF RS.52,95,000/- ON ACCOUNT OF UNEXPLAINED CASH DEPOSITS IN THE BANK ACCOUNT OF M/S. LAKSHMI S AKH SAHAKARITA MARYDIT SOCIETY U/S 69 OF THE I.T. ACT WITHOUT APPR ECIATING THE FINDINGS OF THE AO. 2. DELETING THE ADDITION OF RS.55,42,838/- ON ACCOUNT OF UNEXPLAINED FIXED DEPOSIT CREDITED IN THE BANK ACCOUNT OF M/S. LAKSHMI SAKH SAHAKARITA MARYDIT SOCIETY U/S 69 OF THE I.T. ACT W ITHOUT APPRECIATING THE FINDINGS OF THE AO. 3. DELETING THE ADDITION OF RS.55,42,838/- ON ACCOUNT OF UNEXPLAINED FIXED DEPOSIT WHEN THE TDS ON SUCH ACCOUNT WAS CLAI MED BY THE ASSESSEE AND DULY ALLOWED TO THE ASSESSEE. 4. DELETING THE ADDITION STATING THAT PAN OF THE ASSES SEE WAS GIVEN IN THE BANK ON BEHALF OF THE SOCIETY WHEN THE PAN: AAAAL43 05L WAS ALREADY ALLOTTED TO THE SOCIETY ON 05.02.2011 6. APROPOS FIRST ISSUE RELATING TO DELETION OF ADD ITION OF RS.52,95,000/- ON ACCOUNT OF UNEXPLAINED CASH RECEI PTS, THE LD. DEPARTMENTAL REPRESENTATIVE VEHEMENTLY ARGUED AND S UPPORTED THE ORDERS OF LD.A.O WHILE THE COUNSEL FOR THE ASSESSEE RELIED UPON THE FINDINGS OF LD.CIT(A). 7. WE HAVE HEARD RIVAL CONTENTIONS AND THE RECORD P LACED BEFORE US. WE FIND THAT LD.CIT(A) DELETED THE ADDITION OF RS.5 2,95,000/- OBSERVING AS FOLLOWS; 3.1 I HAVE GONE THROUGH THE APPELLANT'S CONTENTION AND THE AS SESSMENT ORDER. THE ADDITIONS HAVE BEEN MADE ON ACCOUNT OF TRANSACTIONS IN THE RAJENDRA KUMAR GUPTA I.T.A. NO. 221/IND/17 5 BANK A/C NO.3 612 WITH NARMADA JHABUA GRAMIN BANK, KUKSHI. THE APPELLANTS SUBMISSION IS THAT THE SAID ACCOUNT I S OF THE SOCIETY M/S LAKSHMI SAKH SAHAKARITA MARYADIT, KUKSHI. THE APPELLANT IS THE PRESIDENT OF THE SOCIETY AND AT THE TIME OF OPENING OF THE BANK ACCOUNT THE SOCIETY HAD NOT BEEN ALLOTTED PAN AND THE APPEL LANT HAD GIVEN HIS OWN PAN FOR OPENING OF THE BANK ACCOUNT. THE SOCIET Y WAS LATER ON ALLOTTED PAN AAAAL4305L BUT IN THE BANK ACCOUNT THE SOCIETY'S PAN WAS NOT SUBSTITUTED WITH THE PAN OF THE APPELLANT. IT IS SUBMITTED THAT THE FOLLOWING DOC UMENTS WHICH WERE ALSO SUBMITTED TO THE ASSESSING OFFICER PROVE THE EXISTENCE OF THE SOCIETY. (I) COPY OF THE REGISTRATION CERTIFICATE OF THE SOCIETY LAXMI SAKH SAHKARITA MARIYADIT, KUKSHI UNDER THE MADHYA PRADES H AUTONOMOUS COOPERATIVES, 1999 DATED 05/04/2006. (II) COPY OF THE REGISTRATION CERTIFICATE OF THE SOCIETY LAXMI SAKH SAHKARITA MARIYADIT, KUKSHI UNDER THE MADHYA PRADES H COOPERATIVE SOCIETY (AMENDED) ACT, 2012 DATED 08/01/2014. (III) COPY O F PAN CARD OF THE SOCIETY LAXMI SAKH SAHKARITA MARIYADIT, KUKSHI KUKSHI. (IV) THE 1ETTER OF THE AUDITOR MR. RAKESH GUPTA, CA STATING THAT THE ACCOUNTS OF THE SOCIETY HAVE BEEN AUDITED FOR PERIO D ENDING 31/03/2013 ENCLOSING THE P&L A/C AND BALANCE SHEET. (V) COPY OF BANK ACCOUNT OF THE SOCIETY WITH NARMA DA JHABUA GRAMIN BANK A/C NO. 3612 FOR THE PERIOD 01/04/2012TO 31/03 /2013. 3.2 THE ASSESSING OFFICER HAS NOT BROUGHT ANYTHING ON RECORD TO SHOW THAT THE SOCIETY LAXMI SAKH SAHKARITA MARIYADIT, KU KSHI DOES NOT EXIST. THE ASSESSING OFFICER HAS MADE THE ADDITION OF RS.5 2,95,000/- ON ACCOUNT OF CASH DEPOSIT IN THE BANK A/C NO.3612 HOL DING THAT THE SOURCE OF THE SAID DEPOSITS HAS NOT BEEN EXPLAINED BY THE APPELLANT. ADDITION OF RS. 55,42,838/- HAS BEEN MADE ON ACCOUNT OF PROCEEDS OF FIXED DEPOSIT CREDITED INTO THE BANK ACCOUNT. DURING THE ASSESSME NT PROCEEDINGS THE RAJENDRA KUMAR GUPTA I.T.A. NO. 221/IND/17 6 APPELLANT HAD SUBMITTED ALL THE ABOVE DETAILS BEFOR E THE ASSESSING OFFICER BUT HE SIMPLY STATED THAT THE EXISTENCE OF THE SOCIETY IS NOT PROVED. THE DOCUMENTS PLACED ON RECORD CLEARLY ESTABLISH THAT THE SOCIETY LAXMI SAKH SAHKARITA MAIYADIT, KUKSHI WHOSE PRESIDENT IS MR. RAJENDRA KUMAR GUPTA, IS HAVING A/C NO. 3612 WITH NARMADA JH ABUA GRAMIN BANK, KUKSHI. THE CASH BOOK OF THE SOCIETY CLEARLY REFLECTS THE CASH DEPOSITS OF RS.52,95,000/- WHICH HAS BEEN DEPOSITED IN THE SAID BANK ACCOUNT, THE ASSESSING OFFICER HAS HIMSELF, S TATED THAT DURING THE ASSESSMENT PROCEEDINGS THE APPELLANT HAD SUBMITTED A LETTER FROM THE SOCIETY LAXMI SAKH SAHKARITA MARYADI T, KUKSHI STATING THAT THEY HAVE A BANK ACCOUNT WITH NARMADA JHABUA GRAMIN BANK , KUKSHI WHEREIN THE PAN OF THE PRESIDENT SHRI RAJENDRA KURN AR HAS BEEN GIVEN. THE ASSESSING OFFICER HAS NOT BROUGHT ANYTHING ON R ECORD TO DISPROVE THE CONTENTION OF THE APPELLANT. 3.3 FROM THE FACTS AND CIRCUMSTANCES OF THE CASE IT IS EVIDENT THAT BANK ACCOUNT NO. 3612 IN NARMADA JHABUA GRAMIN BANK, KUK SHI IS OF THE SOCIETY M/S. LAXMI SAKH SAHKARITA MAIYADIT WHOSE PR ESIDENT IS THE APPELLANT. THE CASH BOOK OF THE SOCIETY M/S LAXMI SAKH SAHAKARITA MARYADIT REFLECTS THE SAID CASH BALANCES WHICH HAVE BEEN DEPOSITED IN THE ACCOUNT. THEREFORE, THE ADDITION OF RS. 52,95,0 00/- ON ACCOUNT OF CASH DEPOSITED IN THE SAID ACCOUNT DURING THE PERIOD UNDER CONSIDERATION CANNOT BE MADE IN THE HANDS OF THE APPELLANT. THE ADDITION OF RS. 52,95,000/- IS DELETED AND GROUND NO. 2 IS ALLOWED. 8. THE FINDINGS OF THE LD.CIT(A) WERE NOT CONTROV ERTED BY THE DEPARTMENTAL REPRESENTATIVE. RECORDS ASSERTS THE F ACT THAT THE ALLEGED TRANSACTION OF CASH DEPOSITS BELONGED TO TH E SOCIETY NAMELY M/S LAXMI SAKH SAHAKARITA MARYADIT SOCIETY. THE SO CIETY RAJENDRA KUMAR GUPTA I.T.A. NO. 221/IND/17 7 WAS HOLDING SIX BANK ACCOUNTS AND IN ONE OF THE BAN K NARMADA JHABUA GRAMIN BANK, KUKSHI BEARING NO.3612 IN THE COMPUTER SYSTEM OF THE BANK THE PAN OF THE ASSE SSEE WAS MENTIONED WHO WAS THE PRESIDENT OF THE SOCIETY AS A T THAT POINT OF TIME THE SOCIETY WAS NOT ALLOTTED THE PAN NUMBER. LD.CIT(A) EXAMINED THE ISSUE IN DETAIL AND ALSO NOT ED THAT THE SOCIETY WAS ALLOTTED THE PAN NO. AAAAL4305L AND ALS O ALLOTTED REGISTRATION CERTIFICATES GIVEN BY MP AUTO NOMOUS CORPORATION AS WELL AS MP CO-OPERATIVE SOCIETY LTD. WE THEREFORE IN THE FACTS AND GIVEN CIRCUMSTANCES OF T HE CASE ARE OF THE CONSIDERED VIEW THAT LD.CIT(A) RIGHTLY DELET ED THE ADDITION OF RS.52,95,000/- AS THE ALLEGED CASH BELO NGED TO M/S LAXMI SAKH SAHAKARITA MARYADIT SOCIETY AND WAS DEPOSITED IN THE BANK ACCOUNT HELD BY THE SOCIETY AND THE ALLEGED CASH TRANSACTIONS ARE DULY REFLECTED IN THE CASH BOOK MAINTAINED BY THE SOCIETY. THEREFORE NO INTERFERENC E IS CALLED IN THE FINDINGS OF LD.CIT(A). GROUND NO. 1 OF THE REVENUES APPEAL IS DISMISSED. 9. APROPOS GROUND NO.2 & 3 WHICH RELATES TO UNEXPL AINED FIXED DEPOSIT CREDITED IN THE BANK AT RS.55,42,838/ - SIMILAR RAJENDRA KUMAR GUPTA I.T.A. NO. 221/IND/17 8 ARGUMENTS WERE PUT-FORTH BY BOTH THE PARTIES AND TH E LD.CIT(A) DELETED THE ALLEGED ADDITION AS THE FIXED DEPOSIT BELONGED TO THE SOCIETY AND NOT TO THE ASSESSEE. 10. WE HAVE HEARD RIVAL CONTENTIONS AND RECORDS PL ACED BEFORE US. LD.AO MADE THE ADDITION ON ACCOUNT OF UNEXPLAINED FIXED DEPOSIT AT RS.55,42,838/- AS THEY WERE APPEARING UNDER THE PAN NUMBER OF THE ASSESSEE. NE CESSARY VERIFICATION HAS BEEN CARRIED OUT BY LD.CIT(A) WHIC H HAVE NOT BEEN CONTROVERTED BY THE DEPARTMENTAL REPRESENTATIV E. IT IS AN ADMITTED FACT THAT IN THE INSTANT APPEAL THE ADD ITION WERE MADE ONLY BECAUSE OF QUOTING PAN OF PRESIDENT IN TH E BANK ACCOUNT HELD BY THE SOCIETY. ALL DETAILS OF THE AL LEGED FIXED DEPOSITS HAVE BEEN FILED AND PLACED ON RECORD WHICH HAVE BEEN DULY EXAMINED BY THE FIRST APPELLATE AUTHORITY AND THEREBY CONCLUDING THAT THE SOCIETY WAS HAVING FIXE D DEPOSIT OF RS.50 LAKHS IN THE MATURITY AND INTEREST OF RS. 5,4 2,838/- WAS RECEIVED AFTER DEDUCTION OF TAX AT SOURCE. THE ALLEGED TDS WAS REFLECTING IN THE FORM 26AS OF THE ASSESSEE AS HIS PAN NUMBER WAS QUOTED IN THE BANK RECORDS. AUDITED AND FINANCIAL STATEMESNT OF THE SOCIETY CLEARLY SHOWS T HAT THE FIXED RAJENDRA KUMAR GUPTA I.T.A. NO. 221/IND/17 9 DEPOSITS AS WELL AS INTEREST ACCRUED THEREON BELONG TO THE SOCIETY ONLY AND NOT TO THE ASSESSEE. THEREFORE WE FIND NO INCONSISTENCY IN THE FINDINGS OF LD.CIT(A) IN DELET ING THE ADDITION OF RS.55,42,838/-. GROUND NO.2 &3 OF THE REVENUE ARE DISMISSED. 11. APROPOS GROUND NO.4 SEEMS TO BE GENERAL IN NAT URE WHICH NEEDS NO ADJUDICATION. 12. IN THE RESULT THE APPEAL OF THE REVENUE STANDS DISMISSED. ORDER WAS PRONOUNCED IN THE OPEN COURT ON 19.09.201 8. SD/- (KUL BHARAT) SD/- (MANISH BORAD) JUDICIAL MEMBER A CCOUNTANT MEMBER INDORE; DATED : 19/09/2018 /DEV COPY TO: ASSESSEE/AO/PR. CIT/ CIT (A)/ITAT (DR)/GUA RD FILE. BY ORDER PRIVATE SECRETARY/DDO, INDORE