Mr. A. Vasudevan, CHENNAI V. ITO, Tiruppur

ITA 2215/CHNY/2013

• Counselvise Citation: [2019] 118 COUNSELVISE.COM (IT) 3977 (ITAT-CHENNAI)
• Duration Of Justice: 5 year(s) 1 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-02-2019
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 05-07-2017
• Assessment Year: 2009-2010
• Appeal Filed On: 20-12-2013
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: B SAGADEVAN
• Assessee Lawyers: S SRIDHAR
• Section: 54F

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, CHENNAI . . . , ! ' # , % #& BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI INTURI RAMA RAO, ACCOUNTANT MEMBER ./ ITA NO.2215/CHNY/2013 ) *) / ASSESSMENT YEAR : 2009-10 SHRI A. VASUDEVAN, 30B, AMARJOTHI AS NAGAR, NALLUR, TIRUPUR -641 606. PAN : ABXPV 9520 G V. THE INCOME TAX OFFICER, WARD 1(5), TIRUPUR. (,-/ APPELLANT) (./,-/ RESPONDENT) ,- 0 1 / APPELLANT BY : SHRI S. SRIDHAR, ADVOCATE ./,- 0 1 / RESPONDENT BY : SHRI B. SAGADEVAN, JCIT 2 0 3% / DATE OF HEARING : 09.01.2019 45* 0 3% / DATE OF PRONOUNCEMENT : 06.02.2019 / O R D E R PER N.R.S. GANESAN, JUDICIAL MEMBER : THIS APPEAL OF THE ASSESSEE IS DIRECTED AGAINST T HE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS)-II, COIMBA TORE, DATED 30.10.2013 AND PERTAINS TO ASSESSMENT YEAR 2009-10. 2. THE FIRST ISSUE ARISES FOR CONSIDERATION IS CASH DEPOSIT OF 46,50,000/- IN CATHOLIC SYRIAN BANK. 2 I.T.A. NO.2215/CHNY/13 3. SHRI S. SRIDHAR, THE LD.COUNSEL FOR THE ASSESSEE , SUBMITTED THAT THE ASSESSEE PAID 46,50,000/- AS ADVANCE TOWARDS INSTALLATION OF POLLUTION CONTROL PLANT DURING THE ASSESSMENT YE AR 2002-03 THROUGH CHEQUE TO ONE SHRI S.K. PANDIAN, OUT OF BOR ROWED FUNDS FROM HDFC AND M/S SREE GOKULAM CHIT. ACCORDING TO THE LD. COUNSEL, ULTIMATELY, THE POLLUTION CONTROL PLANT CO ULD NOT BE INSTALLED, THEREFORE, THE SAID SHRI S.K. PANDIAN RETURNED 46,50,000/- BY CASH DURING THE YEAR UNDER CONSIDERATION. ACCORDING TO THE LD. COUNSEL, THE AMOUNT RECEIVED FROM SHRI S.K. PANDIAN WAS DEPO SITED IN THE BANK ACCOUNT. REFERRING TO PAGE 9 OF THE PAPER-BOO K, THE LD.COUNSEL SUBMITTED THAT SHRI S.K. PANDIAN CONFIRM ED THAT HE RECEIVED 46,50,000/- FROM THE ASSESSEE THROUGH CHEQUE AND BY CASH. 4. ON THE CONTRARY, SHRI B. SAGADEVAN, THE LD. DEPA RTMENTAL REPRESENTATIVE, SUBMITTED THAT THE ASSESSEE BY A LE TTER DATED 26.12.2011, INFORMED THE ASSESSING OFFICER THAT SHR I S.K. PANDIAN PASSED AWAY ONE YEAR BACK AND THEREFORE, HE COULD N OT PRODUCE CONFIRMATION LETTER FROM HIM. THEREFORE, ACCORDING TO THE LD. D.R., IT IS NOT KNOWN HOW THE ASSESSEE WAS ABLE TO PRODUCE T HE CONFIRMATION LETTER WHICH IS AVAILABLE AT PAGE 9 OF THE PAPER-BOOK. 3 I.T.A. NO.2215/CHNY/13 IN FACT, ACCORDING TO THE LD. D.R., THIS CONFIRMATI ON LETTER WAS NOT PRODUCED BEFORE THE ASSESSING OFFICER AND THE ASSES SEE IN CATEGORICAL TERM SUBMITTED BEFORE THE ASSESSING OFF ICER THAT DUE TO DEATH OF SHRI S.K. PANDIAN HE CANNOT PRODUCE ANY CO NFIRMATION LETTER. THEREFORE, ACCORDING TO THE LD. D.R., THE PRESENT CONFIRMATION LETTER FILED BY THE ASSESSEE, COPY OF WHICH IS AVAILABLE AT PAGE 9 OF THE PAPER-BOOK, IS DOUBTFUL WHICH CANN OT BE RELIED UPON. MOREOVER, ACCORDING TO THE LD. D.R., THE CAT HOLIC SYRIAN BANK LTD. BY ITS LETTER DATED 28.12.2011, CLARIFIED THAT THE CHEQUE ISSUED BY THE ASSESSEE WAS REALIZED BY WITHDRAWING CASH ON THE SAME DAY, THEREFORE, IT IS A CASH CHEQUE ISSUED BY THE ASSESSEE. HENCE, ACCORDING TO THE LD. D.R., THE CLAIM OF THE ASSESSEE THAT THE AMOUNT OF 46,50,000/- ADVANCED WAS RETURNED BY SHRI S.K. PANDIAN IS AFTERTHOUGHT. MOREOVER, ACCORDING TO TH E LD. D.R., WHEN THE MONEY WAS WITHDRAWN FROM BANK BY CASH ON THE SA ME DAY WHEN THE CHEQUE WAS REALIZED, THE SAID AMOUNT WAS N OT AVAILABLE WITH SHRI S.K. PANDIAN, HENCE, THE CIT(APPEALS) HAS RIGHTLY CONFIRMED THE ADDITION MADE BY THE ASSESSING OFFICE R. 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EITH ER SIDE AND PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. THE ASSESSEE 4 I.T.A. NO.2215/CHNY/13 CLAIMS THAT HE ADVANCED A SUM OF 46,50,000/- FOR PURCHASE AND INSTALLATION OF POLLUTION CONTROL PLANT DURING THE ASSESSMENT YEAR 2008-09. THE FACT REMAINS THAT THE CHEQUE SAID TO BE ISSUED BY THE ASSESSEE WAS A CASH CHEQUE AND MONEY WAS WITHDRAWN ON THE SAME DAY. THEREFORE, IT IS NOT KNOWN HOW SHRI S.K. PANDIAN WAS ABLE TO RETURN THE AMOUNT IN CASH AS CLAIMED BY THE ASSESSEE. IN THE ABSENCE OF ANY DETAILS, THE CONFIRMATION LETTER WHICH IS NOW AVAILABLE AT PAGE 9, IS ONLY AN AFTERTHOUGHT. WHEN THE ASSESSEE CLAIMED BEFORE THE ASSESSING OFFICER THAT DUE TO DE ATH OF SHRI S.K. PANDIAN, HE COULD NOT GET ANY CONFIRMATION LETTER F ROM SHRI S.K. PANDIAN, IT IS NOT KNOWN HOW THE ASSESSEE WAS ABLE TO GET THE CONFIRMATION LETTER, COPY OF WHICH IS AVAILABLE AT PAGE 9 OF THE PAPER- BOOK. THEREFORE, THE ENTRIES MADE IN THE LEDGER AN D OTHER CASH BOOK ARE ALL AFTERTHOUGHT. IT IS NOT SUPPORTING TH E CASE OF THE ASSESSEE. THE ASSESSEE HAS NO SATISFACTORY EXPLANA TION FOR DEPOSIT OF 46,50,000/- IN THE BANK ACCOUNT. THEREFORE, 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. THE NEXT ISSUE ARISES FOR CONSIDERATION IS CASH DEPOSIT OF 12,50,000/-. 5 I.T.A. NO.2215/CHNY/13 7. SHRI S. SRIDHAR, THE LD.COUNSEL FOR THE ASSESSEE , SUBMITTED THAT THE ASSESSEE CLAIMED BEFORE THE ASSESSING OFFI CER THAT AN ADVANCE OF 12,50,000/- WAS GIVEN THROUGH CHEQUE TO ONE SHRI R. NAGARAJAN FOR INSTALLATION OF POLLUTION CONTROL PLA NT DURING THE ASSESSMENT YEAR 2008-09. ACCORDING TO THE LD. COUN SEL, THE BORROWED FUNDS OF HDFC BANK AND M/S SREE GOKULAM CH IT WERE USED BY THE ASSESSEE TO ADVANCE 12,50,000/- TO SHRI R. NAGARAJAN. HOWEVER, ACCORDING TO THE LD. COUNSEL, THE SAID SHRI NAGARAJAN RETURNED THE MONEY DURING THE YEAR UNDER CONSIDERATION, THEREFORE, THE SAME WAS DEPOSITED IN THE BANK ACCOU NT. 8. WE HEARD SHRI B. SAGADEVAN, THE LD. DEPARTMENTAL REPRESENTATIVE ALSO. THE ASSESSEE CLAIMS THAT HE A DVANCED A SUM OF 12,50,000/- TO ONE SHRI R. NAGARAJAN FOR INSTALLATI ON OF POLLUTION CONTROL PLANT. THE SAME CLAIM WAS MADE WITH REGARD TO 46,50,000/-. THE SAID SHRI NAGARAJAN WAS EXAMINED BY THE ASSESSING OFFICER ON 29.12.2011. HE ADMITTED BEFOR E THE ASSESSING OFFICER THAT HE IS ONLY ACTING AS REAL ES TATE AGENT FOR BROKERAGE. EVEN THOUGH THE SAID SHRI NAGARAJAN CLA IMED BEFORE THE ASSESSING OFFICER DURING THE COURSE OF EXAMINATION THAT THE MONEY SAID TO BE RECEIVED FROM THE ASSESSEE WAS ADVANCED TO ONE 6 I.T.A. NO.2215/CHNY/13 PROPRIETOR OF DYING UNIT AT ERODE, HE COULD NOT PRO DUCE ANY EVIDENCE. FOR MAKING ANY ADVANCE TO THE DYING UNIT AT ERODE AS CLAIMED, THERE WAS NO EVIDENCE FOR THE CLAIM OF SHR I NAGARAJAN THAT HE RECEIVED BACK FROM THE ERODE PARTY. THE SAID SH RI NAGARAJAN ALSO CLAIMED THAT WHAT WAS RECEIVED FROM THE ASSESS EE IS ONLY BY CASH AND NOT BY CHEQUE. BUT, THE ASSESSEE CLAIMED BEFORE THE ASSESSING OFFICER THAT HE PAID BY CHEQUE. IN VIEW OF THE CONTRARY STATEMENTS OF SHRI NAGARAJAN, THE ASSESSING OFFICER CALLED FOR CLARIFICATION FROM CATHOLIC SYRIAN BANK. THE CATHO LIC SYRIAN BANK CLARIFIED THAT THE CHEQUE ISSUED BY THE ASSESSEE WA S ENCASHED ON THE SAME DAY ACROSS THE COUNTRER. THEREFORE, THE A SSESSING OFFICER FOUND THAT THE DOCUMENT PRODUCED BY THE ASSESSEE IS A COOKED UP ONE. ACCORDINGLY, HE DISALLOWED THE CLAIM OF THE A SSESSEE. 9. THE FACT REMAINS THAT WHAT WAS PAID BY THE ASSES SEE IS THROUGH CASH CHEQUE AND MONEY WAS RECEIVED ACROSS T HE COUNTER IN CATHOLIC SYRIAN BANK. THERE IS NO EVIDENCE OF M AKING PAYMENT TO ERODE PARTY AS CLAIMED BY SHRI NAGARAJAN. THERE IS NO EVIDENCE OF RETURN OF MONEY BY ERODE PARTY TO SHRI NAGARAJAN . MOREOVER, WHETHER SHRI NAGARAJAN WAS ABLE TO REPAY THE MONEY TO THE ASSESSEE AS CLAIMED? THESE FACTS WERE NOT ESTABLIS HED BY THE 7 I.T.A. NO.2215/CHNY/13 ASSESSEE. FOR CASH CREDIT, THE ASSESSEE HAS TO EST ABLISH THE IDENTITY OF PARTY, CREDITWORTHINESS OF PARTY AND GE NUINENESS OF TRANSACTION. IN THIS CASE, EVEN THOUGH THE ASSESSE E CLAIMS THAT MONEY WAS PAID TO SHRI NAGARAJAN, THE GENUINENESS O F TRANSACTION OF REPAYMENT AND CREDITWORTHINESS OF SHRI NAGARAJAN TO REPAY THE AMOUNT WAS NOT ESTABLISHED. THEREFORE, THIS TRIBUN AL DO NOT FIND ANY REASON TO INTERFERE WITH THE ORDER OF THE LOWER AUTHORITY AND ACCORDINGLY THE SAME IS CONFIRMED. 10. THE NEXT ISSUE IS CASH DEPOSIT OF 6,00,000/-. 11. SHRI S. SRIDHAR, THE LD.COUNSEL FOR THE ASSESSE E, SUBMITTED THAT THE ASSESSEE RECEIVED A SUM OF 6,00,000/- FROM ONE SHRI D. PALANISAMY. ACCORDING TO THE LD. COUNSEL, THE ASSE SSEE HAS FILED ONLY CASH BOOK BEFORE THE ASSESSING OFFICER AND THE CIT(APPEALS). THE LD.COUNSEL HAS ALSO SUBMITTED THAT CASH BOOK DI SCLOSING THE FACT OF RECEIPT OF 6,00,000/- FROM SHRI D. PALANISAMY IS AN EVIDENCE, THEREFORE, THE CIT(APPEALS) IS NOT JUSTIF IED IN CONFIRMING THE ADDITION. 12. ON THE CONTRARY, SHRI B. SAGADEVAN, THE LD. DEP ARTMENTAL REPRESENTATIVE, SUBMITTED THAT THE ASSESSEE CLAIMED BEFORE THE 8 I.T.A. NO.2215/CHNY/13 ASSESSING OFFICER THAT HE RECEIVED 6,00,000/- FROM SHRI D. PALANISAMY IN THREE EQUAL INSTALMENTS. ACCORDING T O THE LD. D.R., THE IDENTITY OF SHRI PALANISAMY WAS NOT ESTABLISHED . THE CREDITWORTHINESS OF SHRI PALANISAMY WAS ALSO NOT ES TABLISHED. THE GENUINENESS OF TRANSACTION WAS NOT ESTABLISHED. TH EREFORE, ACCORDING TO THE LD. D.R., THE CIT(APPEALS) HAS RIG HTLY CONFIRMED THE ADNMADE BY THE ASSESSEE. 13. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EIT HER SIDE AND PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. IT IS NOT IN DISPUTE THAT THE ASSESSEE CLAIMED BEFORE THE ASSESS ING OFFICER THAT HE RECEIVED A SUM OF 6,00,000/- FROM ONE SHRI D. PALANISAMY. HOWEVER, THE ASSESSEE FAILED TO ESTABLISH THE IDENT ITY OF SHRI PALANISAMY, CREDITWORTHINESS OF SHRI PALANISAMY AND THE GENUINENESS OF TRANSACTION. IN THE ABSENCE OF ANY DETAILS AND FAILURE OF THE ASSESSEE TO ESTABLISH THE IDENTITY O F PARTY WHICH IS REQUIRED TO BE ESTABLISHED IN RESPECT OF CASH CREDI T, THE CIT(APPEALS) HAS RIGHTLY CONFIRMED THE ADDITION. T HIS TRIBUNAL DO NOT FIND ANY REASON TO INTERFERE WITH THE ORDER OF THE LOWER AUTHORITY AND ACCORDINGLY THE SAME IS CONFIRMED. 9 I.T.A. NO.2215/CHNY/13 14. THE NEXT ISSUE ARISES FOR CONSIDERATION IS DENI AL OF EXEMPTION UNDER SECTION 54F OF THE ACT. 15. SHRI S. SRIDHAR, THE LD.COUNSEL FOR THE ASSESSE E, SUBMITTED THAT THE ASSESSEE HAS SOLD PROPERTY FOR 59,27,500/- AND IT WAS REINVESTED IN A RESIDENTIAL HOUSE AND THE ASSESSEE CLAIMED EXEMPTION UNDER SECTION 54F OF THE ACT. ACCORDING TO THE LD. COUNSEL, THE REINVESTMENT WAS MADE IN THE NAME OF T HE ASSESSEES WIFE. THE ASSESSEE HAS FILED THE ESTIMATE OF BUILD ING CONSTRUCTION FROM A CHARTERED ENGINEER AND ALSO TAX RECEIPTS FOR PAYMENT OF TAXES TO NALLUR MUNICIPALITY. THEREFORE, ACCORDIN G TO THE LD. COUNSEL, THE CIT(APPEALS) IS NOT JUSTIFIED IN CONFI RMING THE ADDITION MADE BY THE ASSESSING OFFICER. 16. ON THE CONTRARY, SHRI B. SAGADEVAN, THE LD. DEP ARTMENTAL REPRESENTATIVE, SUBMITTED THAT THE ASSESSEE CLAIMED THAT A PROPERTY WAS PURCHASED AT 30B, AMARJOTHI AS NAGAR, 2 ND STREET, NALLUR, TIRUPUR IN THE NAME OF HIS WIFE. IN RESPECT OF VER Y SAME PROPERTY, ACCORDING TO THE LD. D.R., THE ASSESSEES WIFE CLAI MED EXEMPTION UNDER SECTION 54F OF THE ACT WHICH WAS ALLOWED BY T HE ASSESSING OFFICER. THEREFORE, ACCORDING TO THE LD. D.R., IT IS NOT KNOWN HOW THE ASSESSEE WAS ABLE TO INVEST AGAIN IN THE PROPER TY IN WHICH THE 10 I.T.A. NO.2215/CHNY/13 ASSESSEES WIFE INVESTED HER OWN CAPITAL GAIN AND C LAIMED EXEMPTION. 17. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EIT HER SIDE AND PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. THE SALE OF PROPERTY TO THE EXTENT OF 59,27,500/- IS NOT IN DISPUTE. THE ASSESSEE CLAIMED EXEMPTION IN RESPECT OF THE PROPER TY STANDING IN THE NAME OF THE ASSESSEES WIFE. NOW THE ASSESSING OFFICER FOUND THAT THE ASSESSEES WIFE IS AN INDEPENDENT ASSESSEE . SHE HERSELF CLAIMED EXEMPTION UNDER SECTION 54F OF THE ACT IN R ESPECT OF THE VERY SAME PROPERTY FOR INVESTING THE CAPITAL GAIN. THEREFORE, IT IS NOT KNOWN HOW THE ASSESSEE WAS ABLE TO CLAIM EXEMPTION UNDER SECTION 54F OF THE ACT FOR THE SECOND TIME. THE MA TTER WOULD STAND DIFFERENTLY IN CASE THE ASSESSEES WIFE HAD NOT CLA IMED ANY EXEMPTION UNDER SECTION 54F OF THE ACT FOR INVESTIN G HER OWN CAPITAL GAIN. SINCE THE ASSESSEES WIFE ALREADY CL AIMED EXEMPTION UNDER SECTION 54F OF THE ACT FOR INVESTING HER OWN CAPITAL GAIN, THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT THE ASSE SSING OFFICER HAS RIGHTLY CONFIRMED THE DISALLOWANCE. THEREFORE, THI S TRIBUNAL DO NOT FIND ANY REASON TO INTERFERE WITH THE ORDER OF THE LOWER AUTHORITY AND ACCORDINGLY THE SAME IS CONFIRMED. 11 I.T.A. NO.2215/CHNY/13 18. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS DISMISSED. ORDER PRONOUNCED IN THE COURT ON 6 TH FEBRUARY, 2019 AT CHENNAI. SD/- SD/- ( ! ' # ) ( . . . ) (INTURI RAMA RAO) (N.R.S. GANESAN) % / ACCOUNTANT MEMBER /JUDICIAL MEMBER /CHENNAI, 7 /DATED, THE 6 TH FEBRUARY, 2019. KRI. 0 .389 :9*3 /COPY TO: 1. ,- /APPELLANT 2. ./,- /RESPONDENT 3. 2 ;3 () /CIT(A)-II, COIMBATORE 4. 2 ;3 /CIT-III, COIMBATORE 5. 9< .3 /DR 6. =) > /GF.