M.Subbarayan, Kancheepuram V. ITO, Kancheepuram

ITA 235/CHNY/2011

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 64541 (ITAT-CHENNAI)
• Duration Of Justice: 1 year(s) 8 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-11-2012
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Next Hearing Date: 08-11-2012
• Assessment Year: 2002-2003
• Appeal Filed On: 14-02-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: K E B RENGARAJAN JR
• Assessee Lawyers: R MEENAKSHISUNDARAM
• Keywords: Unexplained investment
• Section: 69; 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH CHENNAI BEFORE SHRI ABRAHAM P. GEORGE, ACCOUNTANT MEMBER AND SHRI V. DURGA RAO, JUDICIAL MEMBER ------- ITA NO.235/MDS/2011 ASSESSMENT YEAR : 2002-03 SHRI M. SUBBARAYAN, 10, VAIKUNTAPERUMAL KOIL ST., KANCHIPURAM-2. V. INCOME TAX OFFICER, WARD-I(2), KANCHIPURAM (PAN :ABGPS9011A) (APPELLANT) (RESPONDENT) APPELLANT BY : SRI R. MEENAKSHI SUNDARAM, ADVOCATE RESPONDENT BY : SHRI K.E.B. RENGARAJAN, JR. STANDING COUNSEL DATE OF HEARING : 08-1 1-2012 DATE OF PRONOUNCEMENT : 08-11-201 2 O R D E R PER V. DURGA RAO, JUDICIAL MEMBER : THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST T HE ORDER OF THE CIT(APPEALS)-IX, CHENNAI DATED 18-11-2010 FO R THE ASSESSMENT YEAR 2002-03. 2. THE FACTS IN BRIEF ARE THAT THE ASSESSEE HAS MAD E CONTRIBUTION OF ` 3 LAKHS WITH THE KANCHIPURAM MAN BODY LORRY ITA NO.235/MDS /2011 2 OWNERS ASSOCIATION, KANCHIPURAM RELEVANT TO THE ASS ESSMENT YEAR 2002-03. DURING THE COURSE OF THE ASSESSMENT PROCEEDINGS IN THE CASE OF THE SAID ASSOCIATION THE ASSESSEE WAS ASKED FOR THE EXPLANATION WITH REGARD TO THE SO URCE OF THE DEPOSIT WHICH HE HAD MADE AND THE ASSESSEE HAD NOT EXPLAINED PROPERLY THE SOURCE OUT OF WHICH THE DEPO SIT WAS MADE. THE ASSESSEE ALSO NOT FILED RETURN OF INCOM E FOR THE ASSESSMENT YEAR 2002-03. NOTICE U/S 148 OF THE INC OME TAX ACT, 1961 ('THE ACT' FOR SHORT) WAS ISSUED ON 26-08 -2008 AND THERE WAS NO RESPONSE AND SUBSEQUENTLY NOTICE U/S 1 42(1) OF THE ACT WAS ISSUED ON 06-07-2009 BY THE ASSESSING O FFICER. THEREAFTER THE ASSESSEE HAD FILED A RETURN OF INCOM E ON 10-11- 2009 DECLARING INCOME OF ` 72,300/-. THE CASE WAS SELECTED FOR SCRUTINY. AFTER SCRUTINY PROCEEDINGS, THE ASSE SSING OFFICER ADDED ` 2,50,000/- AS UNEXPLAINED INVESTMENT AND DEPOSIT MADE TO KPM MAN BODY LORRY OWNERS ASSOCIATION. 3. THE ASSESSEE CARRIED THE MATTER BEFORE THE CIT(APPEALS). THE LEARNED CIT(APPEALS) CONFIRMED T HE ASSESSMENT ORDER PASSED BY THE ASSESSING OFFICER. 4. ON BEING AGGRIEVED, THE ASSESSEE CARRIED THE MAT TER IN APPEAL BEFORE THE TRIBUNAL. THE LEARNED COUNSEL FO R THE ITA NO.235/MDS /2011 3 ASSESSEE HAS SUBMITTED THAT THE ASSESSEE HAD SOLD T WO SHOP PREMISES FOR ` 17 LAKHS IN THE MONTH OF MARCH, 1998. PART OF THIS MONEY WAS SPENT FOR THE FAMILY PURPOSE AND THE BALANCE MONEY WAS AVAILABLE WITH THE ASSESSEE. THE LEARNED COUNSEL FOR THE ASSESSEE FURTHER SUBMITTED THAT WITHOUT CON SIDERING THE EXPLANATION OF THE ASSESSEE, THE ASSESSING OFFICER THE LEARNED CIT(APPEALS) SIMPLY HELD THAT THE SOURCE WAS NOT EX PLAINED AND THEREFORE SECTION 69 OF THE ACT HAD NO APPLICAT ION TO THE ASSESSEES CASE. 5. ON THE OTHER HAND, THE LEARNED DR STRONGLY SUPPO RTED THE ORDERS PASSED BY THE AUTHORITIES BELOW. 6. WE HAVE HEARD BOTH THE SIDES, PERUSED THE RECORD S AND GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW. THE ONLY ISSUE INVOLVED IN THIS APPEAL IS WHETHER THE ASSESS EE IS HAVING SOURCE FOR ` 2,50,000/- WHICH HE HAD INVESTED IN M/S. KPM MAN BODY LORRY OWNERS ASSOCIATION. IT IS AN ADMITTED FACT THAT THE ASSESSEE HAD CONTRIBUTED ` 3 LAKHS TO M/S. KPM MAN BODY LORRY OWNERS ASSOCIATION IN THE ASSESSMENT YEAR 200 2-03. WHEN THE ASSESSING OFFICER ASKED THE ASSESSEE TO EX PLAIN THE ASSESSEE SUBMITTED HIS REPLY ON 19.11.2009. THE AS SESSEES EXPLANATION HAS BEEN REPRODUCED BY THE ASSESSING OF FICER IN ITA NO.235/MDS /2011 4 THE ASSESSMENT ORDER AT PAGE NO.2, WHEREIN IT WAS S UBMITTED THAT THE ASSESSEE HAD SOLD TWO SHOPS FOR ` 17 LAKHS IN MARCH, 1998 AND THAT MONEY WAS AVAILABLE WITH HIM. THIS F ACT WAS NOT DISPUTED BY THE ASSESSING OFFICER AND THEREFORE THE ASSESSEE HAS EXPLAINED THE SOURCE OF HIS INVESTMENT . THE ONLY CASE OF THE REVENUE WAS THAT THE ASSESSEE HAS NOT F ILED THE RETURN OF INCOME FOR THE ASSESSMENT YEAR 2002-03 AN D THEREFORE THE ASSESSEES EXPLANATION WITH REGARD TO THE SOURCE OF INCOME WAS NOT CONSIDERED. IN OUR OPINION, THE ASSESSEE HAS EXPLAINED THE SOURCE OF HIS INVESTMENT WHICH IS NOT DISPUTED OR ENQUIRED BY THE ASSESSING OFFICER AS TO WHETHER THE ASSESSEE HAD SOLD THE SHOP PREMISES OR NOT. WI THOUT MAKING SUCH AN ENQUIRY, THE ASSESSING OFFICER CANNO T SIMPLY INVOKE SECTION 69 OF THE ACT. THE ASSESSEE IN THIS CASE HAS EXPLAINED ALL THE DETAILS WITH REGARD TO THE SOURCE . ACCORDING TO HIS EXPLANATION HE WAS HAVING MORE MONEY THEN WH AT HE HAD INVESTED. THEREFORE, IN OUR OPINION, SEC. 69 O F THE ACT HAS NO APPLICATION. THE LEARNED CIT(APPEALS) HAS SIMPL Y APPROVED THE ORDER PASSED BY THE ASSESSING OFFICER WITHOUT C ONSIDERING THE EXPLANATION GIVEN BY THE ASSESSEE. WE, THEREFO RE, FIND THAT THE ORDER OF THE LEARNED CIT(APPEALS) IS NOT C ORRECT. ITA NO.235/MDS /2011 5 ACCORDINGLY, THE SAME IS CANCELLED AND THE GROUND O F APPEAL RAISED BY THE ASSESSEE IS ALLOWED. 7. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT AT THE TIME OF HEARING ON THURSDAY, THE 8 TH OF NOVEMBER, 2012, AT CHENNAI. SD/- SD/- (ABRAHAM P. GEORGE) ( V.DURGA RAO ) ACCOUNTANT MEMBER JUDICIAL MEMBER CHENNAI, DATED THE 08 TH NOVEMBER, 2012. H. COPY TO: ASSESSEE/AO/CIT (A)/CIT/D.R./GUARD FILE