K.Syed Zakir Hussain, CHENNAI V. ITO, CHENNAI

ITA 2261/CHNY/2013

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 96377 (ITAT-CHENNAI)
• Duration Of Justice: 1 year(s) 10 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-11-2015
• Appeal Filed By: Assessee
• Bench Allotted: A
• Next Hearing Date: 29-09-2015
• Assessment Year: 2009-2010
• Appeal Filed On: 26-12-2013
• Court: TRIBUNAL
• Department Lawyers: A B KOLI
• Assessee Lawyers: T C SAJITH BABU
• Keywords: Unexplained expenditure
• Section: 69C; 143(3)

Judgement Text

, , IN THE INCOME-TAX APPELLATE TRIBUNAL A BENCH, CHE NNAI . , ! ' . #$ , % & BEFORE SHRI A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER & SHRI DUVVURU RL REDDY, JUDICIAL MEMBER ./ I.T.A.NO.2261/MDS./2013 ( / ASSESSMENT YEAR :2009-10) SHRI K.SYED ZAKIR HUSSAIN , 16/33,THANDAVAN STREET, PURASAWALKAM, CHENNAI 600 007. VS. THE INCOME TAX OFFICER, WARD XIV(2), CHENNAI. PAN BAIPS 5014 F ( '( / APPELLANT ) ( )*'( / RESPONDENT ) / APPELLANT BY : MR.T.C.SAJITH BABU,ADVOCATE / RESPONDENT BY : MR.A.B.KOLI, JCIT, D.R / DATE OF HEARING : 29.09.2015 /DATE OF PRONOUNCEMENT : 13.11.2015 + / O R D E R PER A.MOHAN ALANKAMONY , ACCOUNTANT MEMBER: THIS APPEAL IS FILED BY THE ASSESSEE, AGGRIEVED B Y THE ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX(A)-VII, CHEN NAI, DATED ITA NO. 2261/MDS/13 2 17.10.2013 IN ITA NO.985/13-14 PASSED UNDER SECTIO N 143(3) READ WITH SECTION 250 OF THE ACT. 2. THE ASSESSEE HAS RAISED NINE ELABORATE GROUNDS IN HIS APPEAL, HOWEVER THE CRUX OF THE ISSUES IS THAT THE LD. CIT (A) HAD ERRED IN SUSTAINING THE ADDITION MADE BY THE A.O ON ACCOUNT OF TRANSACTIONS FROM CREDIT CARD PAYMENTS TO THE EXTENT OF ` 26,20,907/- AS UNEXPLAINED EXPENDITURE U/S 69C OF THE ACT. 3. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESS EE IS AN INDIVIDUAL, LAWYER BY PROFESSION, FILED HIS RETURN OF INCOME FOR THE ASSESSMENT YEAR 2009-10 ON 29.12.2009 ADMITTING TOT AL INCOME AS ` 1,81,160/-. THE CASE WAS TAKEN FOR SCRUTINY UNDER CASS AND THE ASSESSMENT WAS COMPLETED ON 30.12.2011 U/S 143(3) O F THE ACT WHEREIN THE LD. ASSESSING OFFICER AMONGST CERTAIN A DDITIONS MADE AN ADDITION OF ` 26,20,907/- AS UNEXPLAINED EXPENDITURE U/S 69C OF T HE ACT. ITA NO. 2261/MDS/13 3 4. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, TH E ASSESSEE WAS ASKED TO EXPLAIN THE SOURCE FOR CREDIT CARDS PA YMENTS AMOUNTING TO ` 52,90,286/- TOWARDS SIX CREDIT CARDS HELD BY HIM. W HILE EXPLAINING THE SOURCE FOR THESE CREDIT CARD PAYMENTS, THE ASSE SSEE STATED THAT HE USED TO UTILIZE THE CREDIT TRANSFER FACILITY FRO M ONE CREDIT CARD TO MAKE PAYMENT FOR ANOTHER CREDIT CARD ISSUED BY DIFF ERENT BANKS AND THIS WENT ON IN A CYCLE REFLECTING SUCH HUGE PAYMEN T. THE ASSESSEE WAS ALSO ABLE TO RECONCILE AND MATCH THE LOAN OBTAI NED FROM ONE CREDIT CARD FOR MAKING THE PAYMENT AGAINST THE OTHE R CREDIT CARD ISSUED BY A DIFFERENT BANK TO THE TUNE OF ` 26,69,379/-. SINCE THE ASSESSEE COULD NOT RECONCILE THE BALANCE AMOUNT, TH E LD. ASSESSING OFFICER MADE AN ADDITION OF ` 29,60,000/-. 5. ON APPEAL, THE LD.CIT(A) SUSTAINED THE ADDITION MADE BY THE LD. ASSESSING OFFICER TO THE EXTENT OF ` 26,20,207/- BY OBSERVING AS UNDER:- THE STATEMENT OF FACTS, GROUNDS OF APPEAL AND ARG UMENTS OF THE AR ARE CAREFULLY CONSIDERED WITH REFERENCE TO THE ASSESSME NT ORDER PASSED. IN THE GROUNDS OF APPEAL, THE APPELLANT CONTESTED THE ADDI TION MADE ON ACCOUNT OF ITA NO. 2261/MDS/13 4 CREDITS IN CREDIT CARD TRANSACTIONS AND DISALLOWANC E OF PRINCIPAL AND INTEREST PAYMENT TOWARDS HOUSING LOAN. PERUSAL OF RECORDS PE RTAINING TO AY 2009-10 RECEIVED FROM THE AO REVEALED THAT THE AO ANALYZED THE CREDIT CARD STATEMENTS OF ICICI BANK, HSBC BANK, HDFC BANK, STANDARD CHART ERED BANK, ETC. AND ACCEPTED THE EXPLANATION GIVEN TO THE EXTENT OF RS. 26,20,907/-THE APPELLANT COULD NOT EXPLAIN THE BALANCE AMOUNT OF RS.26,20,20 7/- THOUGH SUFFICIENT OPPORTUNITY PROVIDED TO HIM. IN THE ABSENCE OF ANY EVIDENCE, THE AO WAS LEFT WITH NO CHOICE EXCEPT ADDING THE SUM OF RS.26,20,207/- T O THE RETURNED INCOME AND TAXED IT ACCORDINGLY. BEFORE THE UNDERSIGNED, THE AR AND THE ASSESSEE A PPEARED BUT DO NOT PRODUCE ANY EVIDENCE TO DISPROVE THE ADDITION MADE. THEY ARGUED THAT THE NECESSARY EVIDENCE IS NOT AVAILABLE WITH THE APPELL ANT. THE CONTENTION OF NON- AVAILABILITY OF EVIDENCE WITH THE APPELLANT SHOWS T HE LEVITY AND CALLOUSNESS ON THE PART OF THE APPELLANT AND HENCE NOT ACCEPTABLE. THE APPELLANT HIMSELF IS A LAWYER AND ABLY ASSISTED BY THE CHARTERED ACCOUNTANT BUT C OULD NOT MAINTAIN PROPER RECORDS FOR THE TRANSACTIONS MADE BY HIM THROUGH CR EDIT CARDS. THE CREDIT CARD STATEMENTS AVAILABLE IN THE RECORDS OF THE AC REVEA L THAT THE ACCOUNT CAN BE ACCESSED THROUGH ONLINE, 24 HOUR CUSTOMER CARE OR W RITE THROUGH ACCOUNTS MANAGER. THE APPELLANT DID NOT TRY THESE FACILITIES TO GET THE ACCOUNTS IN FULL. IN THE ABSENCE OF ANY EVIDENCE EITHER BEFORE THE AC OR BEFORE THE UNDERSIGNED, THE CONTENTION OF DELETING THE ADDITION MADE IS NOT TEN ABLE AND HENCE REJECTED. THE AO WAS FAIR ENOUGH TO GIVE CREDIT TO THE AMOUNTS EX PLAINED FROM THE CARD ITA NO. 2261/MDS/13 5 STATEMENT MADE AVAILABLE BEFORE HIM. IN VIEW OF THE ABOVE DISCUSSION, I HAVE NO ALTERNATIVE EXCEPT TO CONFIRM THE ADDITION OF RS.26 ,20,207/- AND THE SAME IS CONFIRMED ACCORDINGLY. 5. BEFORE US, LD.A.R SUBMITTED THAT HE WOULD BE IN A POSITION TO RECONCILE THE BALANCE AMOUNT OF ` 26,20,207/- WHICH ON THE EARLIER OCCASIONS HE WAS UNABLE TO RECONCILE BEFORE THE REV ENUE AND THEREFORE, PLEADED THAT ONE MORE OPPORTUNITY MAY BE PROVIDED TO PRESENT HIS CASE BEFORE THE LD. ASSESSING OFFICER. THOUGH THE LD. D.R VEHEMENTLY OPPOSED TO THE SUBMISSIONS OF THE LD . A.R., FINALLY HE CONCEDED FOR THE MATTER TO BE REMITTED BACK TO T HE FILE OF LD. ASSESSING OFFICER IN ORDER TO PROVIDE ONE MORE OPPO RTUNITY TO THE ASSESSEE TO RECONCILE THE BANK STATEMENTS. AFTER H EARING BOTH SIDES AND CONSIDERING THE FACTS OF THE CASE, IN THE INTER EST OF JUSTICE WE HEREBY REMIT THE MATTER BACK TO THE FILE OF LD. ASS ESSING OFFICER FOR FRESH CONSIDERATION WITH A DIRECTION TO THE ASSESSE E TO CO-OPERATE WITH THE REVENUE IN THEIR PROCEEDINGS IN ORDER TO E XPEDITE THEIR ORDER FAILING WHICH THE REVENUE SHALL BE AT LIBERTY TO PA SS APPROPRIATE ORDER ON LAW AND MERITS BASED ON THE MATERIALS ON RECORD. ITA NO. 2261/MDS/13 6 6. IN THE RESULT, THE APPEAL OF ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES ORDER PRONOUNCED ON 13 TH NOVEMBER, 2015 AT CHENNAI. SD/- S D/- ( ! ' . #$ ) ( DUVVURU RL REDDY ) ( . ) (A.MOHAN ALANKAMONY) JUDICIAL MEMBER ACCOUNTANT MEMBER CHENNAI, DATED THE 13 TH NOVEMBER,2015. K S SUNDARAM. COPY TO: ASSESSEE/AO/CIT (A)/CIT/D.R./GUARD FILE