SNEHAL J. MEHTA, MUMBAI V. ACIT 12(3), MUMBAI

ITA 2231/MUM/2013

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 0449 (ITAT-MUMBAI)
• Duration Of Justice: 4 year(s) 2 month(s) 10 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-05-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: E
• Next Hearing Date: 24-06-2015
• Assessment Year: 2009-2010
• Appeal Filed On: 20-03-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAJAT MITTAL
• Keywords: Income from undisclosed sources; Opportunity of being heard; Assessment record; Onus to prove
• Section: 143(3); 142(1)

Judgement Text

, , , IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES C, MUMBAI , . . , , BEFORE SHRI JOGINDER SINGH, JUDICIAL MEMBER, AND SHRI N.K. PRADHAN, ACCOUNTANT MEMBER ITA NO.8548/MUM/2011 ASSESSMENT YEAR: 2008-09 ACIT-12(3), R. NO.137, 1 ST FLOOR, AAYAKAR BHAVAN, M.K. ROAD, MUMBAI / VS. CHIRAG JAYANT MEHTA, 65, BAJAJ BHAVAN, NARIMAN POINT, MUMBAI-400021 ( ! / REVENUE) ( '# $ /ASSESSEE) P.A. NO.AFKPM6103P ITA NO.8871/MUM/2011 ASSESSMENT YEAR: 2008-09 CHIRAG JAYANT MEHTA, 65, BAJAJ BHAVAN, NARIMAN POINT, MUMBAI-400021 / VS. ACIT-12(3), MUMBAI ( '# $ /ASSESSEE) ( ! / REVENUE) P.A. NO.AFKPM6103P ITA NOS.8548 & 8871/MUM/2011 & ITA NOS.2230 & 2231/MUM/2013 CHIRAG JAYANT MEHTA & SNEHAL JAYNAT MEHTA 2 ITA NO.2230/MUM/2013 ASSESSMENT YEAR: 2009-10 CHIRAG J. MEHTA, 65, BAJAJ BHAVAN, NARIMAN POINT, MUMBAI-400021 / VS. ACIT-12(3), MUMBAI ( '# $ /ASSESSEE) ( ! / REVENUE) P.A. NO.AFKPM6103P ITA NO.2231/MUM/2013 ASSESSMENT YEAR: 2009-10 SNEHAL J. MEHTA, 65, BAJAJ BHAVAN, NARIMAN POINT, MUMBAI-400021 / VS. ACIT-12(3), MUMBAI ( '# $ /ASSESSEE) ( ! / REVENUE) P.A. NO.AFBPM7557E '# $ / ASSESSEE BY SHRI MANI JAIN ! / REVENUE BY SHRI RAJAT MITTAL -DR % !& ' $ ( / DATE OF HEARING : 04/05/2017 ' $ ( / DATE OF PRONOUNCEMENT 31/05/2017 / O R D E R PER JOGINDER SINGH (JUDICIAL MEMBER) THIS BUNCH OF FOUR APPEALS IS BY THE DIFFERENT ASSE SSEE. IN THE CASE OF SHRI CHIRAG JAYANT MEHTA, THERE IS C ROSS APPEAL FOR ASSESSMENT YEAR 2008-09 (ITA NO.8871/MUM/2011 A ND ITA 8548/MUM/2011). THIS ASSESSEE IS ALSO IN APPEAL FOR ASSESSMENT YEAR 2009-10 (ITA NO.2230/MUM/2013). IN ITA ITA NOS.8548 & 8871/MUM/2011 & ITA NOS.2230 & 2231/MUM/2013 CHIRAG JAYANT MEHTA & SNEHAL JAYNAT MEHTA 3 NO.2231/MUM/2013, SHRI SNEHAL JAYANT MEHTA IS IN AP PEAL FOR ASSESSMENT YEAR 2009-10. 2. FIRST, WE SHALL TAKE UP THE CROSS APPEAL FOR ASSESSMENT YEAR 2008-09, WHEREIN, IN THE CASE OF AS SESSEE (ITA NO.8871/MUM/2011), THE ONLY GROUND PERTAINS TO CONFIRMING THE ADDITION OF RS.1,5,08,500/- IN RESPE CT OF CASH DEPOSIT, WITH STANDARD CHARTERED BANK (ACCOUNT. NO. 231-1- 016504-1). THE LD. COUNSEL FOR THE ASSESSEE, SHRI MANI JAIN, EXPLAINED THAT THE CASH DEPOSITED IN THE ACCOUNT WA S EARLIER WITHDRAWN IN THE CURRENT YEAR AND EARLIER YEAR (PAG E-10 OF THE PAPER BOOK), THE DETAILS OF WHICH WERE FILED BE FORE THE ASSESSING OFFICER, FOR PURCHASE OF LAND. IT WAS CO NTENDED THAT SINCE THE DEAL COULD NOT MATERIALIZE, THEREFOR E, THE SAME WAS AGAIN DEPOSITED. THE CRUX OF THE ARGUMENT IS T HAT THE SOURCE OF CASH WAS DULY PROVED. RELIANCE WAS PLACE D UPON THE DECISION IN MR. C. VAMSI MOHAN NANDYAL, ITA NO.469/HYD/2014, ORDER DATED 27/03/2015. OUR ATTE NTION WAS ALSO INVITED THE COPY OF THE CASH BOOK SUMMARY (PAGES 10 TO 30 OF THE PAPER BOOK), COPY OF THE CAPITAL AC COUNT LEDGER OF THE ASSESSEE IN THE BOOKS OF M/S TRANCE OCEAN AG ENCY (PAGES 31 TO 39 OF THE PAPER BOOK), COPY OF THE CAS H BOOK SUMMARY IN THE CASE OF SNEHAL MEHTA ALONG WITH THE BANK STATEMENT FOR THE PERIOD 01/04/2005 TO 31/03/2008 ( PAGES 40 TO 92 OF THE PAPER BOOK), COPY OF THE CASH DEPOS IT DETAILS ALONG WITH CERTIFICATE FROM THE BANK (PAGES 93 TO 9 6 OF THE PAPER BOOK), COPY OF ITR ACKNOWLEDGMENT FOR ASSESSM ENT ITA NOS.8548 & 8871/MUM/2011 & ITA NOS.2230 & 2231/MUM/2013 CHIRAG JAYANT MEHTA & SNEHAL JAYNAT MEHTA 4 YEAR 2008-09, 2006-07 AND 2003-04 (PAGES 97 TO 100 OF THE PAPER BOOK) ALONG WITH VARIOUS PAGES LIKE PAGES 104 AND 121 OF THE PAPER BOOK, CONTAINING 141 PAGES. ALL THESE DOCUMENTS WERE CLAIMED TO BE EITHER PART OF ASSESSMENT RECORD OR BEFORE THE LD. COMMISSIONER OF INCOME TAX (APPEAL). ON THE OTHER HAND, THE LD. DR, CONTENDED THAT NO CORROBORATIVE E VIDENCE WAS FILED BY THE ASSESSEE TO PROVE THE SOURCE OF CA SH, THEREFORE, THE ADDITION WAS RIGHTLY MADE. 2.1. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. THE FACTS , IN BRIEF, ARE THAT THE ASSESSEE, AN INDIVIDUAL AND ALSO PARTN ER IN A PARTNERSHIP FIRM DECLARING INCOME OF RS.44,35,000/- IN HIS RETURN FILED ON 30/01/2009, WHICH WAS PROCESSED U/S 143(10 OF THE INCOME TAX ACT, 1961 (HEREINAFTER THE ACT). THE CASE OF THE ASSESSEE WAS SELECTED FOR SCRUTINY UNDE R CASS, THEREFORE, NOTICE U/S 143(2) AND 142(1) OF THE ACT ALONG WITH QUESTIONNAIRE WERE ISSUED ON DIFFERENT DATES AND SE RVED UPON THE ASSESSEE. THE ASSESSEE ATTENDED THE PROCEEDINGS FROM TIME TO TIME AND FILED THE DETAILS CALLED FOR AND T HE CASE WAS ALSO DISCUSSED (AS IS EVIDENT FROM PAGE-1 OF THE AS SESSMENT ORDER PASSED U/S 143(3) OF THE ACT). AS PER THE RE VENUE, THERE WAS AN INFORMATION, RECEIVED THROUGH AIR, THA T THERE IS CASH DEPOSIT EXCEEDING RS.10 LAKH IN THE SAVING BAN K ACCOUNT OF THE ASSESSEE. AS PER THE REVENUE, THE CA SH WAS STATED TO BE RS.10,99,23,512/- IN THE STANDARD CHAR TERED BANK. THE ASSESSEE WAS ASKED TO FURNISH THE NECESS ARY ITA NOS.8548 & 8871/MUM/2011 & ITA NOS.2230 & 2231/MUM/2013 CHIRAG JAYANT MEHTA & SNEHAL JAYNAT MEHTA 5 EVIDENCES TO WHICH THE ASSESSEE FILED LETTER DATED 13/12/2010 CLAIMING THAT THE AMOUNT OF RS.4,61,29,9 80/- AND RS.4,23,53,032/- (TOTAL RS.8,84,83,012/-) DOES NOT PERTAIN TO THE ASSESSEE. THUS, THE INFORMATION WITH RESPECT TO THE AMOUNT OF RS.10,99,23,512/- GOT REDUCED TO RS.2,14,40,500/-, IN VIEW OF REVISION MADE BY THE S TANDARD CHARTERED BANK. THE ASSESSEE VIDE LETTER DATED 24/1 0/2010 EXPLAINED THAT THE ASSESSEE WAS PLANNING TO PURCHAS E AGRICULTURAL LAND, THEREFORE, THE AMOUNT WAS WITHDR AWN IN CASH FROM THE BANK ACCOUNTS FOR THE PAYMENTS. SINCE , THE DEAL COULD NOT MATERIALIZE, THEREFORE, THE CASH WIT HDRAWN FROM BANK WAS RE-DEPOSITED. THE ASSESSEE ALSO EXPLA INED THAT THE CASH DEPOSIT OF RS.99,32,000/- WAS FROM THE ACC OUNT WHICH WAS JOINTLY WITH SHRI SNEHAL MEHTA. AS PER TH E REVENUE, THIS CLAIM OF THE ASSESSEE IS MERELY AN AF TERTHOUGHT AND NO CORROBORATIVE EVIDENCE OF WITHDRAWAL WAS PRO DUCED. THE SUM AND SUBSTANCE OF MAKING THE ADDITION IS THA T ONUS TO PROVE THE WITHDRAWAL/SOURCE IS UPON THE ASSESSEE , WHICH HAS NOT BEEN DISCHARGED. IT WAS ALSO OBSERVED BY T HE ASSESSING OFFICER THAT NO PRUDENT BUSINESSMAN WOULD KEEP HUGE AMOUNT OF CASH UNUTILIZED. IT IS ALSO OBSERVED THAT THE ASSESSEE WITHDREW THE CASH FOR SOME OTHER PURPOSE, NO DISCLOSED TO THE DEPARTMENT AND THE SAME HAS BEEN T WISTED TO JUSTIFY THE CASH DEPOSIT OF RS.2,14,40,500/- (PA GE-4 OF THE ASSESSMENT ORDER). FINALLY, THE LD. ASSESSING OFFIC ER OBSERVED AS UNDER:- ITA NOS.8548 & 8871/MUM/2011 & ITA NOS.2230 & 2231/MUM/2013 CHIRAG JAYANT MEHTA & SNEHAL JAYNAT MEHTA 6 4 . 3 THE ASSESSEE HAS FAILED TO FURNISH THE FOLLOWING : A) BALANCE SHEET AS ON 31.03.2008, 31.03 . 2007 , 31.03 . 2006 . B) CAPITAL ACCOUNT FOR THE YEAR ENDED 31.03 . 2008 , 3 1 .03 . 2007 , 31.03.2006. C) WEA L TH TAX RECORDS FOR SUCH HUGE CASH ON HAND . D) EVEN THE LIST OF PROPERTIES GIVEN ON RENT WAS NEVER SUBMITTED TILL THE QUERY WAS RAISED DURING THE COURSE OF ASSESSMENT. E) NO STATEMENT OF AFFAIRS FOR ALL THE THREE YEARS VIZ. FOR A. Y.2006-07 , 2007 -08 & 2008-09 WERE ANY TIME FILED T I LL CONCLUSION OF ASSESSMENT. F) MERE FILING OF BANK: SUMMARY OR LET T ERS NEITHER JUSTIF I ES THE SOURCE OF CASH DEPOSIT NOR DOES IT PROVE THE GENUINENESS OF EXPLANATION CLAIMED BY THE ASSESSEE. G) IN THE MATTER OF CASH CREDIT THE SUPREME COURT HAS HELD THAT ON PREPONDERANCE OF PROBABILITY , T HE ADDIT I ONS CAN BE MADE WHEREVER THE ONUS IS NOT D I SCHARGED BY THE ASSESSEE [SUMA T I DAYA180 TAXMANN 89 ( SC ) ]. IN THE LIGHT OF THE ABOVE OBSERVATION, THE AMOUNT OF RS.2,14,40,500/- WAS HELD AS INCOME FROM UNDISCLOSED SOURCES UNDER THE HEAD INCOME FROM OTHER SOURCES. ITA NOS.8548 & 8871/MUM/2011 & ITA NOS.2230 & 2231/MUM/2013 CHIRAG JAYANT MEHTA & SNEHAL JAYNAT MEHTA 7 2.2. THE ASSESSEE CHALLENGED THE ADDITION BEFORE T HE LD. COMMISSIONER OF INCOME TAX (APPEAL), WHEREIN, T HE OBSERVATION MADE BY THE ASSESSING OFFICER ALONG WIT H THE SUBMISSIONS OF THE ASSESSEE WERE CONSIDERED LIKE CA SH SUMMARY, OPENING CASH BALANCE AS ON 01/04/2005 AND CLAIM OF THE ASSESSEE THAT THE AMOUNT OF RS.1,85,82 ,000/- WAS WITHDRAWN FROM THE BANK ACCOUNT UP TO THE FINAN CIAL YEAR RELEVANT TO ASSESSMENT YEAR 2008-09 AND DURING THE YEAR UNDER CONSIDERATION, THE AMOUNT OF RS.10 LAKH FROM M/S TRANCE OCEAN AGENCIES, WHERE THE ASSESSEE WAS A PARTNER, ETC. AND FINALLY DELETED THE ADDITION OF RS.99,32,000/- (JOINT ACCOUNT OPERATED WITH HIS BRO THER). THE REVENUE IS IN APPEAL AGAINST THE AFORESAID DELETION AND THE ASSESSEE FOR THE REMAINING, WHICH WAS SUSTAINED BY THE LD. COMMISSIONER OF INCOME TAX (APPEAL). 2.3. IF THE OBSERVATION MADE IN THE ASSESSMENT ORD ER, LEADING TO ADDITION MADE TO THE TOTAL INCOME, CONCL USION DRAWN IN THE IMPUGNED ORDER, MATERIAL AVAILABLE ON RECORD, ASSERTIONS MADE BY THE LD. RESPECTIVE COUNSEL, IF K EPT IN JUXTAPOSITION AND ANALYZED, BEFORE ADVERTING FURTHE R, WE ARE EXPECTED TO ANALYZE THE FACTUAL MATRIX AND CONTENTI ONS RAISED FROM BOTH SIDES. BEFORE US, THE MAIN GRIEVANCE OF THE REVENUE IS THAT NO WISE BUSINESSMAN WILL KEEP SUCH A CASH UNUTILIZED FOR LONGER PERIOD. THE OBSERVATION MADE AT PAGE 3 AND 4 OF THE ASSESSMENT ORDER IS REPRODUCED HEREUND ER:- ITA NOS.8548 & 8871/MUM/2011 & ITA NOS.2230 & 2231/MUM/2013 CHIRAG JAYANT MEHTA & SNEHAL JAYNAT MEHTA 8 THIS ALSO SHOWS THAT THE CONTENTION OF THE ASSESSE E IS NOT JUSTIFIED. NO PRUDENT BUSINESSMAN WOULD KEEP SUCH H UGE AMOUNT OF CASH UNUTILIZED. THEREFORE, THE NATURAL C OROLLARY IS THAT SAID CASH WAS USED BY THE ASSESSEE FOR THE REA SONS AND APPLICATIONS NOT MENTIONED IN THE DETAILS SUBMITTED . THIS CLEARLY SHOWS THAT THE ASSESSEE HAS WITHDRAWN CASH FOR SOME OTHER PURPOSES NOT DISCLOSED TO THE DEPARTMENT AND NOW BEING CONFRONTED WITH AIR INFORMATION, THE SAME HAS BEEN TWISTED TO JUSTIFY THE CASH DEPOSIT OF RS.2,14,4 0,500/-. IF THE AFORESAID OBSERVATION (HIGHLIGHTED PORTION ) IS ANALYZED, ONE CLEAR FACT IS OOZING OUT THAT EVEN THE LD. ASSE SSING OFFICER HAS ADMITTED THAT THE CASH AMOUNT WAS WITHD RAWN BY THE ASSESSEE BUT FOR SOME OTHER PURPOSE NO DISCLOSE D TO THE DEPARTMENT. IN SUCH A SITUATION, IT CAN BE SAID THA T FACTUM OF WITHDRAWAL OF CASH WAS NOT EVEN DISPUTED BY THE REV ENUE. THE ONLY POINT WHICH HAS TO BE CONSIDERED THE PURPO SE OF WITHDRAWAL. RIGHT FROM BEGINNING I.E. ASSESSMENT ST AGE AND TILL BEFORE THIS TRIBUNAL, THE ASSESSEE HAS BEEN CL AIMING THAT THE AMOUNT WAS WITHDRAWN FOR PURCHASING SOME LAND, WHICH FINALLY COULD NOT MATERIALIZE AND THE SAME AMOUNT W AS RE- DEPOSITED. THE LD. ASSESSING OFFICER AS WELL AS TH E LD. DR HAS RELIED UPON THE DECISION FROM HON'BLE APEX COUR T IN SUMATI DAYAL 80 TAXMAN 89 (SC), WHICH SPEAKS ABOUT HUMAN PROBABILITIES. WE ADD HERE THAT THE HUMAN PROBABILITIES APPLIES TO BOTH SIDES. SO FAR AS, KEE PING THE CASH UNUTILIZED OR KEEPING THE SAME IN THE BANK IS PURELY THE DECISION OF AN INDIVIDUAL AND THE DEPARTMENT IS NOT EXPECTED ITA NOS.8548 & 8871/MUM/2011 & ITA NOS.2230 & 2231/MUM/2013 CHIRAG JAYANT MEHTA & SNEHAL JAYNAT MEHTA 9 TO GUIDE. THE BUSINESSMAN KNOWS HIS INTEREST AND TH E COMPELLING SITUATIONS BEST. 2.4. NOW, WE SHALL ANALYZE THE CLAIM OF THE ASSESS EE. DURING HEARING, THE LD. COUNSEL FOR THE ASSESSEE IN VITED OUR ATTENTION TO VARIOUS PAGES OF THE PAPER BOOK. AT P AGE-40 OF THE PAPER BOOK, THERE IS A CASH SUMMARY IN THE CASE OF SNEHAL MEHTA (PAN, AFBPM7557E), WHICH IS SHOWING RS.51,16,000/- CLOSING CASH ON 31/03/2006, RS.70,53 ,000/- CASH BALANCE AS ON 31/03/2007 AND THE CASH SUMMARY FOR THE PERIOD 2007-08 AS ON 31/03/2008, RS.3,56,000/-, MEANING THEREBY, THERE WAS CASH BALANCE WITH THE AS SESSEE AS DISCUSSED HEREINABOVE. IT IS ALSO NOTED THAT EXC EPT OBSERVING BY THE ASSESSING OFFICER THAT THE CASH W AS WITHDRAWN FOR SOME OTHER PURPOSE IS NOT SUBSTANTIAT ED BY THE DEPARTMENT. NO EVIDENCE HAS BEEN BROUGHT ON REC ORD BY THE ASSESSING OFFICER THAT THE ASSESSEE IN FACT USE D THE UNUTILIZED CASH FOR ANY OTHER PURPOSE. NEITHER THER E IS SUCH CLAIM BY THE ASSESSEE. THE EARLIER YEAR RETURNS OF THE ASSESSEE ARE WITH THE DEPARTMENT ON THE BASIS OF WH ICH IT COULD HAVE BEEN ESTABLISHED THAT THE UNUTILIZED CAS H WAS USED IN EARLIER YEARS. NO SUCH EVIDENCE WAS MENTION ED BY THE DEPARTMENT WHILE PRESUMING SO. IN SUCH A SITUATION, WE ARE OF THE VIEW THAT PRESUMPTION CANNOT TAKE THE SHAPE OF EVIDENCE, HOWEVER STRONG IT MAY BE. AS MENTIONED EA RLIER EVEN THE LD. ASSESSING OFFICER HAS PRESUMED THAT TH E CASH WAS, THOUGH WITHDRAWN, BUT MIGHT HAVE USED FOR OTHE R ITA NOS.8548 & 8871/MUM/2011 & ITA NOS.2230 & 2231/MUM/2013 CHIRAG JAYANT MEHTA & SNEHAL JAYNAT MEHTA 10 PURPOSES, WHICH HAS NOT BEEN ESTABLISHED BY THE REV ENUE. IDENTICALLY, THE HYDERABAD BENCH OF THE TRIBUNAL IN THE CASE OF MR. C. VAMSI MOHAN NANDYAL, ITA NO.469/HYD/2014, ORDER DATED 27/03/2015 HELD AS UNDER:- THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAI NST THE ORDER OF LD. CIT(A)-IV, HYDERABAD DATED 10.01.2014 WHEREBY H E CONFIRMED THE ADDITION OF RS.21 LAKHS MADE BY THE A.O. ON ACC OUNT OF CASH DEPOSIT OF RS. 21 LAKHS FOUND TO BE MADE IN THE BAN K ACCOUNT OF THE ASSESSEE TREATING THE SAME AS UNEXPLAINED CASH CRED IT. 2. THE ASSESSEE IN THE PRESENT CASE IS AN INDIVIDUA L WHO IS ENGAGED IN THE BUSINESS OF DEALING IN MEDICINE AND OTHER PR ODUCTS ON RETAIL BASIS IN THE NAME AND STYLE OF HIS PROPRIETARY M/S. C.P. MEDICAL AND FANCY STORE. THE RETURN OF INCOME FOR THE YEAR UNDER CONSIDERATION WAS FILED BY HIM ON 31.03.2010 DECLAR ING TOTAL INCOME OF RS.1,60,490. DURING THE COURSE OF ASSESSM ENT PROCEEDINGS, THE BANK ACCOUNT MAINTAINED BY THE ASS ESSEE WITH STATE BANK OF INDIA WAS VERIFIED BY THE A.O. AND ON SUCH VERIFICATION, HE FOUND THAT THERE WERE CASH DEPOSIT S MADE FROM TIME TO TIME AGGREGATING TO RS.33,75,000. ALTHOUGH IT WA S EXPLAINED BY THE ASSESSEE THAT THE SAID AMOUNT WAS DEPOSITED OUT OF CASH WITHDRAWALS MADE FROM THE SAME ACCOUNT ON EARLIER D ATES AS WELL AS SALE PROCEEDS OF HIS PROPRIETARY BUSINESS, THE A .O. DID NOT FIND THE SAME TO BE ACCEPTABLE IN THE ABSENCE OF ANY SUP PORTING EVIDENCE. ACCORDINGLY, A SUM OF RS.21 LAKHS WAS ADD ED BY HIM TO THE TOTAL INCOME OF THE ASSESSEE IN THE ASSESSMENT COMPLETED UNDER SECTION 143(3) VIDE ORDER DATED 21.10.2011. 3. AGAINST THE ORDER PASSED BY THE A.O. UNDER SECTI ON 143(3), AN APPEAL WAS PREFERRED BY THE ASSESSEE BEFORE THE LD. CIT(A) AND THE SUBMISSION AS MADE BEFORE THE A.O. WAS REITERATED O N BEHALF OF THE ASSESSEE WHILE EXPLAINING THE CASH DEPOSIT OF RS. 2 1 LAKHS FOUND TO BE MADE IN HIS BANK ACCOUNT ON 24.12.2008. THE LD. CIT(A) ITA NOS.8548 & 8871/MUM/2011 & ITA NOS.2230 & 2231/MUM/2013 CHIRAG JAYANT MEHTA & SNEHAL JAYNAT MEHTA 11 HOWEVER, DID NOT FIND THE SAME TO BE ACCEPTABLE AND CONFIRMED THE ADDITION OF RS. 21 LAKHS MADE BY THE A.O. FOR THE F OLLOWING REASONS GIVEN IN PARAS 4.2 TO 4.4 OF HIS IMPUGNED ORDER. 4.2. I HAVE CONSIDERED THE FACTS ON RECORD AND THE SUBMISSIONS OF THE A.R. I HAVE ALSO EXAMINED THE CA SH FLOW STATEMENT PREPARED BY THE APPELLANT ON THE BAS IS OF THE BANK TRANSACTIONS. THE EXPLANATION OF THE A.R. IS BASED ENTIRELY ON THE CLAIM THAT THE DEPOSITS HAD B EEN MADE OUT OF THE CASH WITHDRAWALS EARLIER MADE FROM THE SAME ACCOUNT. HOWEVER, CONTRARY TO THE A.RS CLAIM, I DO NOT FIND ANY PROXIMITY BETWEEN THE WITHDRAWALS AND THE DEPOSITS. FOR EXAMPLE, THE APPELLANT MADE A SERIES OF FIVE WITHDRAWALS RANGING FROM RS.2,00,000 TO RS.4,00,000 AGGREGATING TO RS.12,50,000 BETWEEN THE PERIOD 02.05.2008 AND WITHDREW ANOTHER SUM OF RS.8,00,000 ON 31.06.2008. THERE WAS NO REASON FOR THE APPELLANT T O MAKE THE REPEATED WITHDRAWALS IF HE HAD THE AMOUNTS WITHDRAWN EARLIER AVAILABLE WITH HIM. INDEED THE TRANSACTIONS FOLLOW A SIMILAR PATTERN THROUGH THE Y EAR. 4.3. SIMILARLY, THE APPELLANT HAD MADE A DEPOSIT OF RS.21,00,000 ON 24.12.2008. THERE WAS A WITHDRAWAL OF RS.13,00,000 ON 17.12.2008 BEFORE THE DEPOSIT AND O F RS.16,00,000 ON 30.12.2008 AFTER IT. THE APPELLANT HAS FAILED TO EXPLAIN WHY A SUBSTANTIAL SUM OF RS.13,00 ,000 WAS WITHDRAWN FROM THE BANK MERELY TO KEEP IT IDLE AS CASH ONLY TO REDEPOSIT IT A WEEK LATER. THE APPELLA NT HAS ALSO FAILED TO EXPLAIN WHY THE APPELLANT NEEDED TO CONTINUE WITHDRAWING CASH EVEN WHEN APPARENTLY LARG E CASH BALANCE WERE AVAILABLE WITH HIM. 4.4. THE LOGICAL EXPLANATION FOR SUCH LARGE WITHDRA WALS WOULD BE THAT THE APPELLANT NEEDED THE MONEY EITHER FOR HIS BUSINESS OR PERSONAL EXPENSES OR FOR MAKING INVESTMENTS, IN WHICH CASE THE CASH WITHDRAWN WOULD HAVE BEEN UTILIZED AND NOT BE AVAILABLE FOR REDEPOS IT. THE APPELLANT WOULD HAVE ME BELIEVE THAT HE HAD NOTHING ITA NOS.8548 & 8871/MUM/2011 & ITA NOS.2230 & 2231/MUM/2013 CHIRAG JAYANT MEHTA & SNEHAL JAYNAT MEHTA 12 BETTER TO DO THAN TO WITHDRAW AND DEPOSIT CASH IN A RANDOM MANNER APPARENTLY AS A PASTIME. THE EXPLANATION OF THE APPELLANT IS CONTRARY TO THE PROBABILITIES OF HUMAN BEHAVIOR AND IS, THEREFORE, REJECTED. AGGRIEVED BY THE ORDER OF LD. CIT(A), ASSESSEE HAS PREFERRED THIS APPEAL BEFORE THE TRIBUNAL. 4. WE HAVE HEARD THE ARGUMENTS OF BOTH THE SIDES AN D ALSO PERUSED THE RELEVANT MATERIAL ON RECORD. LD. COUNSEL FOR TH E ASSESSEE HAS SUBMITTED THAT ALTHOUGH THERE WAS NO CASH BOOK MAIN TAINED BY THE ASSESSEE TO SHOW THAT THE DEPOSIT OF RS. 21 LAKHS M ADE IN THE BANK ACCOUNT ON 24.12.2008 WAS OUT OF THE WITHDRAWALS MA DE ON EARLIER DATES, WITHDRAWAL OF RS. 13 LAKHS MADE FROM THE SAME BANK ACCOUNT JUST A WEEK BEFORE I.E., ON 17.12.2008 SHOU LD ATLEAST BE TREATED AS THE SOURCE OF CASH DEPOSIT MADE ON 24.12 .2008. ALTHOUGH LEARNED D.R. IN THIS REGARD HAS CONTENDED THAT THE ASSESSEE MIGHT HAVE UTILIZED THE AMOUNT OF RS. 13 L AKHS WITHDRAWN ON 17.12.2008 FOR SOME OTHER PURPOSE, WE FIND THAT THERE IS NOTHING ON RECORD TO SHOW THAT THE AMOUNT OF RS. 13 LAKHS WITHDRAWN BY THE ASSESSEE ON 17.12.2008 WAS USED FO R SOME OTHER PURPOSE. IN OUR OPINION, THE SAID WITHDRAWAL HAVING BEEN MADE BY THE ASSESSEE JUST BEFORE A WEEK I.E. ON 17.12.2008, THE SAME CAN REASONABLY BE TREATED AS AVAILABLE WITH THE ASSESSE E FOR CASH DEPOSIT OF RS.21 LAKHS MADE ON 24.12.2008 ESPECIALL Y WHEN THERE IS NOTHING TO SHOW THAT THE AMOUNT OF RS. 13 LAKHS WITHDRAWN ON 17.12.2008 WAS UTILIZED BY THE ASSESSEE FOR SOME OT HER PURPOSE. WE, THEREFORE, TREAT THE CASH DEPOSIT OF RS. 21 LAK HS MADE BY THE ASSESSEE IN THE BANK ACCOUNT ON 24.12.2008 AS EXPLA INED TO THE EXTENT OF RS. 13 LAKHS AND SUSTAIN THE ADDITION MAD E BY THE A.O. AND CONFIRMED BY THE LD. CIT(A) ON THIS ISSUE TO TH E EXTENT OF RS. 8 LAKHS. 5. IN THE RESULT, APPEAL OF THE ASSESSEE IS PARTLY ALLOWED. ITA NOS.8548 & 8871/MUM/2011 & ITA NOS.2230 & 2231/MUM/2013 CHIRAG JAYANT MEHTA & SNEHAL JAYNAT MEHTA 13 IN THE LIGHT OF THE FOREGOING DISCUSSION, WE ALLOW THE APPEAL OF THE ASSESSEE. 3. SO FAR AS, THE APPEAL OF THE REVENUE (ITA NO.8548/MUM/2011) IS CONCERNED, THERE IS UNCONTROVE RTED FINDING THAT THE ASSESSEE FURNISHED THE CASH SUMMAR Y AND THE ASSESSEE WITHDREW RS.1,85,82,000/- FROM THE SAI D BANK UP TO THE END OF FINANCIAL YEAR RELEVANT TO ASSESSM ENT YEAR 2008-09 AND THE AMOUNT OF RS.10 LAKH FROM M/S TRANC E OCEAN AGENCIES, WHERE THE ASSESSEE IS A PARTNER. TH E CASH WAS WITHDRAWN AT REGULAR INTERVAL AS THE ASSESSEE W AS TO PURCHASE AGRICULTURAL LAND. THE LD. COMMISSIONER OF INCOME TAX (APPEAL) HAS ALSO CONSIDERED THE OBSERVATION MA DE IN THE ASSESSMENT ORDER AND THE SUBMISSIONS MADE BY THE AS SESSEE AND THEREAFTER DELETED THE ADDITION OF RS.99,32,000 /- IN RESPECT OF BANK ACCOUNT NO.23110165033 IN THE STAND ARD CHARTERED BANK. THIS ACCOUNT WAS JOINTLY MAINTAINED WITH HIS BROTHER SHRI SNEHAL J. MEHTA, THUS, CONSIDERING THE TOTALITY OF FACTS AND THE CIRCUMSTANCES MENTIONED I N THE IMPUGNED ORDER AND ALSO NARRATED BEFORE US, WE FIND NO INFIRMITY IN THE CONCLUSION DRAWN BY THE LD. COMMIS SIONER OF INCOME TAX (APPEAL). WE AFFIRM THE SAME, RESULTANTL Y, THE APPEAL OF THE ASSESSEE IS ALLOWED AND OF THE REVENU E IS HAVING NO MERIT, THEREFORE, DISMISSED. 4. IN THE APPEAL FOR ASSESSMENT YEAR 2009-10 (ITA NO.2230/MUM/2013) THE FACTS WERE CLAIMED TO BE IDEN TICAL. HOWEVER, WE FIND THAT THE LD. COMMISSIONER OF INCOM E TAX ITA NOS.8548 & 8871/MUM/2011 & ITA NOS.2230 & 2231/MUM/2013 CHIRAG JAYANT MEHTA & SNEHAL JAYNAT MEHTA 14 (APPEAL) PRODUCED VARIOUS OPPORTUNITIES AS IS EVIDE NT FROM PAGE-1 OF THE IMPUGNED ORDER FROM 24/04/2012 TO 09/11/2012, ADJOURNMENT WERE SOUGHT BY THE ASSESSEE AND LAST TWO DATES, THE ASSESSEE COULD NOT ATTEND. IN THE ABSENCE OF NON-ATTENDANCE, AN EX-PARTE ORDER WAS PASSED EVE N NOBODY WAS REPRESENTING THE DEPARTMENT. THE MANDATE OF ARTICLE-265 OF CONSTITUTION OF INDIA IS TO LEVY AND COLLECT DUE TAXES, THEREFORE, TO SAFEGUARD THE INTEREST OF BOTH SIDES, WE DEEM IT APPROPRIATE TO SEND THIS ISSUE TO THE FILE OF THE LD. COMMISSIONER OF INCOME TAX (APPEAL) TO ADJUDICATE T HE SAME AFRESH ON MERIT. THE ASSESSEE BE GIVEN OPPORTUNITY OF BEING HEARD WITH FURTHER LIBERTY TO FURNISH EVIDENCE, IF ANY, TO SUBSTANTIATE HIS CLAIM, THUS, THIS APPEAL OF THE AS SESSEE IS ALLOWED FOR STATISTICAL PURPOSES. 5. NOW, WE SHALL TAKE UP APPEAL IN ITA NO.2231/MUM/2013, ASSESSMENT YEAR 2009-10, THE FIRS T AND SECOND GROUND, RAISED BY THE ASSESSEE, PERTAINS TO PASSING AN EX-PARTE ORDER WITHOUT PROVIDING ADEQUAT E OPPORTUNITY OF BEING HEARD TO THE ASSESSEE AND THER EBY CONFIRMING THE ADDITION OF RS.64,41,000/- IN RESPEC T OF CASH DEPOSITED IN THE STANDARD CHARTERED BANK AND FURTHE R CONFIRMING THE ADDITION OF RS.30,212/- ON ACCOUNT O F ALLEGED UNDISCLOSED INTEREST INCOME. 5.1. THE CRUX OF ARGUMENT ON BEHALF OF THE ASSESSE E IS THAT THE ASSESSEE WAS HAVING SUFFICIENT CASH IN HAN D AT THE TIME OF DEPOSITING THE SAME IN THE BANK ACCOUNT. AS PER THE ITA NOS.8548 & 8871/MUM/2011 & ITA NOS.2230 & 2231/MUM/2013 CHIRAG JAYANT MEHTA & SNEHAL JAYNAT MEHTA 15 REVENUE, THERE WAS AIR INFORMATION WITH RESPECT TO THE CASH DEPOSITED IN THE BANK ACCOUNT, THEREFORE, IN RESPON SE TO SHOW CAUSE NOTICE, THE ASSESSEE COULD NOT PROVE THE GENU INENESS OF DEPOSIT, WITH EVIDENCE. 5.2. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. IN THIS A PPEAL ALSO, THE PLEA OF THE ASSESSEE IS THAT THE ASSESSEE WAS P LANNING TO BY AGRICULTURE LAND, THEREFORE, HE STARTED WITHDRAW ING THE CASH FROM THE BANK ACCOUNT TO PAY THE AGRICULTURIST AND SINCE, THE DEAL COULD NOT BE MATERIALIZE, THE SAME WAS DEPOSITED IN THE BANK. THOUGH, WE HAVE ADJUDICATE D IDENTICAL GROUND, WHILE ADJUDICATING THE APPEAL OF THE REVENUE (ITA NO.8548/MUM/2011), STILL IN THE INTERE ST OF THE JUSTICE, WE DEEM IT APPROPRIATE TO EXAMINE THE FACT UAL MATRIX WHETHER THE ASSESSEE, DURING THE RELEVANT PERIOD, I N FACT, WITHDREW THE AMOUNTS AND IF IT WAS WITHDRAWN WHETHE R IT WAS USED FOR ANY OTHER PURPOSES. THIS ASPECT HAS NO T BEEN EXAMINED BY THE DEPARTMENT. THE ASSESSEE IS DIRECT ED TO EXAMINE THE FACTUAL MATRIX AND AFTER PROVIDING DUE OPPORTUNITY OF BEING HEARD DECIDE AFRESH IN ACCORDA NCE WITH LAW. THE ASSESSEE IS AT LIBERTY TO FURNISH NECESSAR Y EVIDENCE, IF ANY, IN SUPPORT OF HIS CLAIM. THUS, THIS APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. 6. SO FAR AS, GROUND NO.3 WITH RESPECT TO CONFIRMI NG THE ADDITION OF RS.30,212/- ON ACCOUNT OF ALLEGED U NDISCLOSED INTEREST INCOME IS CONCERNED, IT IS CONSEQUENTIAL I N NATURE. ITA NOS.8548 & 8871/MUM/2011 & ITA NOS.2230 & 2231/MUM/2013 CHIRAG JAYANT MEHTA & SNEHAL JAYNAT MEHTA 16 THE LD. ASSESSING OFFICER IS DIRECTED TO EXAMINE TH E FACTUAL MATRIX AND AFTER PROVIDING DUE OPPORTUNITY TO THE A SSESSEE, DECIDE AFRESH IN ACCORDANCE WITH LAW. IDENTICAL IS THE SITUATION FOR GROUND NO.4. THUS, GROUND NO. 3 AND 4 ARE ALLOWED FOR STATISTICAL PURPOSES. FINALLY, I. APPEAL OF THE REVENUE (ITA NO.8548/MUM/2011) FOR ASSESSMENT YEAR 2008-09 IS DISMISSED II. APPEAL OF THE ASSESSEE (ITA NO.8871/MUM/2011) ASSESSMENT YEAR 2008-09 IS ALLOWED. III. APPEAL OF THE ASSESSEE (ITA NO. 2230/MUM/2011) ASSESSMENT YEAR 2009-10 IS ALLOWED FOR STATISTICAL PURPOSES. IV. APPEAL OF THE ASSESSEE (ITA NO. 2231/MUM/2011), SNEHAL JAYANT MEHTA, ASSESSMENT YEAR 2009-10 IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 31ST, MAY, 2017. SD/- SD/- ( N.K. PRADHAN ) (JOGINDER SINGH) ' # / ACCOUNTANT MEMBER $ # / JUDICIAL MEMBER MUMBAI; - DATED : 31/05/2017 F{X~{T? P.S/. .. , ITA NOS.8548 & 8871/MUM/2011 & ITA NOS.2230 & 2231/MUM/2013 CHIRAG JAYANT MEHTA & SNEHAL JAYNAT MEHTA 17 !%$&'()(*& / COPY OF THE ORDER FORWARDED TO : 1. ./01 / THE APPELLANT 2. 201 / THE RESPONDENT. 3. 3 3 4$ , ( ./ ) / THE CIT, MUMBAI. 4. 3 3 4$ / CIT(A)- , MUMBAI 5. 6!7$ , 3 ./(. + , / DR, ITAT, MUMBAI 6. 8'9 / GUARD FILE. ! / BY ORDER, 26/$$ //TRUE COPY// / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI