D. Shanmugam, Villupuram V. ITO, Villupuram

ITA 2425/CHNY/2016

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 5011 (ITAT-CHENNAI)
• Duration Of Justice: 7 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-04-2017
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Next Hearing Date: 03-04-2017
• Assessment Year: 2010-2011
• Appeal Filed On: 22-08-2016
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Assessee Lawyers: V S JAYAKUMAR SHRI B
• Keywords: Unexplained investment
• Section: 144

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL A (SMC) BENCH : CHENNAI . , [BEFORE SHRI ABRAHAM P. GEORGE, ACCOUNTANT M EMBER ] ./I.T.A. NO. 2425/MDS/2016 / ASSESSMENT YEAR : 2010-2011 D. SHANMUGAM, 4/1777, PILLAYAR KOIL STREET, V. PALAYAM, NANNADU POST, VILLUPURAM TALUK. [PAN BYJPS 4138P] VS. THE INCOME TAX OFFICER, WARD -1, VILLUPURAM. ( !' / APPELLANT) ( #$!' /RESPONDENT) / APPELLANT BY : SHRI. V.S. JAYAKUMAR, ADVOCATE /RESPONDENT BY : SHRI. B.SAHADEVA, IRS, JCIT /DATE OF HEARING : 03-04-2017 !' /DATE OF PRONOUNCEMENT : 12-04-2017 % / O R D E R ASSESSEE IN THIS APPEAL IS AGGRIEVED ON AN ADDITIO N OF B12,06,000/-, WHICH WAS CONFIRMED BY THE LD.CIT(A). 2. FACTS APROPOS ARE THAT FOR THE IMPUGNED ASSESSMENT YEAR ASSESSEE HAD NOT FILED RETURN OF INCOME FOR THE IMP UGNED ASSESSMENT YEAR. LD. ASSESSING OFFICER WAS HAVING INFORMATION THAT ASSESSEE HAD MADE CASH DEPOSITS OF B12,06,000/- IN AN ICICI BAN K SAVING ACCOUNT ITA NO. 2425/MDS/2016 :- 2 -: DURING THE RELEVANT PREVIOUS YEAR. A NOTICE U/S.14 8 OF THE ACT WAS ISSUED TO THE ASSESSEE. DESPITE SUCH NOTICE ASSESS EE DID NOT FILE ANY RETURN. LD. ASSESSING OFFICER COMPLETED THE ASSESS MENT UNDER SECTION 144 OF THE ACT TREATING THE SUM OF B12,06,000/- AS UNEXPLAINED INVESTMENT U/S.69 OF THE ACT. 3. AGGRIEVED, ASSESSEE MOVED IN APPEAL BEFORE LD. COMMISSIONER OF INCOME TAX (APPEALS). ARGUMENT OF T HE ASSESSEE WAS THAT HE WAS NOT HAVING ANY SOURCE OTHER THAN AGRICU LTURAL INCOME. ACCORDING TO ASSESSEE, DEPOSITS IN THE BANK ACCOUNT CAME OUT OF SALE OF AGRICULTURAL LAND BELONGING TO HIS MATERNAL UNCL E ONE SHRI. NARAYANASWAMY. AS PER THE ASSESSEE, SHRI. NARAYAN ASWAMY WHO WAS VERY AGED HAD GIVEN THE CASH TO THE ASSESSEE F OR SAFE CUSTODY AND FOR CONSTRUCTING A HOUSE FOR SHRI. NARAYANAS WAMYS CHILDREN. AS PER THE ASSESSEE, SHRI. NARAYANASWAMY DIED LATER A ND HIS SONS SHRI. MURUGAN AND MR. GUHAN HAD TAKEN THE MONEY BACK FRO M HIM. ASSESSEE ALSO SUBMITTED THAT HE HAD NOT TAKEN THE N OTICE ISSUED BY THE LD. ASSESSING OFFICER SERIOUSLY DUE TO IGNORANC E. IN SUPPORT OF HIS CONTENTION, ASSESSEE ALSO PRODUCED A SALE DEED DATE D 27.03.2008 EXECUTED BY LATE SHRI. NARAYANASWAMY WHICH REFLECTE D A SALE OF 2.39.60 HECTRES (APPROXIMATELY 6 ACRES) OF AGRICULT URAL LAND FOR RS.5,00,000/- BY SHRI. NARAYANASWAMY. ASSESSEE ALS O POINTED OUT THAT THE BANK ACCOUNT WAS WITH AXIS BANK AND NOT WI TH ICICI. ITA NO. 2425/MDS/2016 :- 3 -: CONFIRMATION LETTERS FROM SHRI. MURUGAN AND SHRI. G UHAN WERE ALSO FILED. LD. COMMISSIONER OF INCOME TAX (APPEALS) S OUGHT A REMAND REPORT FROM THE LD. ASSESSING OFFICER ON THE EVIDEN CE PRODUCED BY THE ASSESSEE. 4. IN THE REMAND REPORT SUBMITTED BY THE LD. ASSESSING OFFICER IT WAS STATED BY HIM THAT ASSESSEE DID NOT GIVE ANY EVIDENCE IN SUPPORT OF ITS CLAIM THAT HE HAD RECEIVED B12,06,00 0/- FROM SHRI. NARAYANASWAMY. ACCORDING TO HIM, THE SALE OF PROPE RTY ON 27.03.2008 COULD NOT BE CONSIDERED AS AN EVIDENCE F OR SOURCE OF DEPOSITS BY THE ASSESSEE IN THE BANK ACCOUNT. FUR THER, AS PER LD. ASSESSING OFFICER, ASSESSEE COULD NOT SHOW ANY EVID ENCE FOR THE SUM OF RS.7,00,000/- CLAIMED AS AGRICULTURAL INCOME EAR NED BY SHRI. NARAYANASWAMY GIVEN TO ASSESSEE FOR SAFE CUSTODY. A GAIN AS PER THE LD. ASSESSING OFFICER HE HAD SUMMONED LEGAL HEIRS OF SHRI. NARAYANASWAMY DURING THE COURSE OF REMAND PROCEEDIN GS. ACCORDING TO HIM, SHRI. GUHAN HAD STATED THAT THE HOUSE WAS C ONSTRUCTED WHEN HIS FATHER WAS ALIVE UNDER THE DIRECT SUPERVISION OF HIS FATHER AND EXPENDITURE WAS ALSO MET BY HIS FATHER. LD. ASSESS ING OFFICER CONCLUDED THAT ASSESSEES VERSION COULD NOT BE BELI EVED. 5. ASSESSEE OBJECTED TO THE REMAND REPORT BEFORE LD. COMMISSIONER OF INCOME TAX (APPEALS). ACCORDING TO HIM, A WHOLESOME VIEW WAS NOT TAKEN BY THE LD. ASSESSING O FFICER. ASSESSEE ITA NO. 2425/MDS/2016 :- 4 -: ALSO POINTED OUT THAT SMT. KAVERI DAUGHTER OF SHRI. NARAYANASWAMY HAD CLEARLY MENTIONED THAT HER FATHER WAS HAVING A LOT OF DEALINGS WITH THE ASSESSEE AND HER BROTHERS SHRI. MURUGAN A ND SHRI. GUHAN WERE NOT HAVING SUFFICIENT KNOWLEDGE REGARDING HER FATHERS TRANSACTIONS. 6. LD. COMMISSIONER OF INCOME TAX (APPEALS) AFTER CONS IDERING THE SUBMISSIONS OF THE ASSESSEE AND REMAND REPORT O F THE LD. ASSESSING OFFICER CONFIRMED THE ADDITION. HE DISB ELIEVED THE CLAIM OF THE ASSESSEE THAT PART OF THE DEPOSITS HAD GONE OUT OF SALE CONSIDERATION RECEIVED ON SALE OF AGRICULTURAL LAND BY SHRI. NARAYANASWAMY AND PART OF THE DEPOSITS HAD GONE OF AGRICULTURAL RECEIPTS OF SHRI. NARAYANASWAMY. 7. NOW BEFORE ME, LD. AUTHORISED REPRESENTATIVE SUBMIT TED THAT THE ORIGINAL ASSESSMENT WAS A BEST OF JUDGMENT ONE AND ASSESSEE WAS UNABLE TO PRESENT HIS CASE PROPERLY. AS PER THE L D. AUTHORISED REPRESENTATIVE, EVEN IN THE REMAND PROCEEDINGS, ASS ESSEE COULD NOT CONDUCT A CROSS EXAMINATION OF SHRI. MURUGAN AND SH RI. GUHAN. FURTHER AS PER LD. AUTHORISED REPRESENTATIVE, DAUGHTER OF S HRI. NARAYANASWAMY HAD CLEARLY STATED THAT HIS SONS SHRI . MURUGAN AND SHRI. GUHAN HAD NO KNOWLEDGE OF THE DEALINGS OF HER FATHER WITH ASSESSEE. IN ANY CASE AS PER LD. AUTHORISED REPRES ENTATIVE SHRI. MURUGAN AND SHRI. GUHAN HAD CONFIRMED RECEIPT OF B 5,00,000/- BACK ITA NO. 2425/MDS/2016 :- 5 -: FROM THE ASSESSEE. THIS ACCORDING TO HIM, WOULD SH OW THAT THE MONEY BELONGED TO SHRI. NARAYANASWAMY NOT TO THE AS SESSEE. 8. PER CONTRA, LD. DEPARTMENTAL REPRESENTATIVE STRONGL Y SUPPORTED THE ORDERS OF THE AUTHORITIES BELOW. 9. I HAVE CONSIDERED THE RIVAL CONTENTIONS AND PERUSE D THE ORDERS OF THE AUTHORITIES BELOW. WHAT I FIND IS THA T DAUGHTER OF SHRI. NARAYANASWAMY HAD GIVEN A STATEMENT WHICH JUSTIFIED CLAIM OF THE ASSESSEE. SHE ALSO MENTIONED THAT THE SONS OF SHRI . NARAYANASWAMY, NAMELY SHRI. MURUGAN AND SHRI. GUHAN WERE NOT HAVIN G MUCH KNOWLEDGE OF THEIR FATHERS DEALINGS WITH THE ASSE SSEE. IN MY OPINION ASSESSEE HAS BEEN ABLE TO SHOW THAT HE HAD CLOSE P ROXIMITY WITH SHRI. NARAYANASWAMY. LD. ASSESSING OFFICER IN THE REMAND REPORT HAD NOT TAKEN INTO CONSIDERATION THE STATEMENT GIVEN BY SHRI. NARAYANASWAMYS DAUGHTER. LD. ASSESSING OFFICER SHO ULD HAVE CONSIDERED THE REASONABLENESS OF THE EXPLANATION OF THE ASSESSEE AND WHETHER IT WAS SUPPORTED WITH ENOUGH EVIDENCE TO GE NERATE CONFIDENCE IN WHAT WAS CLAIMED. IN MY OPINION, AN OBJECTIVE ANALYSIS WAS NOT DONE BY THE LOWER AUTHORITIES. I AM OF THE OPINION THAT ISSUE REQUIRES A FRESH LOOK BY THE LD. ASSESSING OFFICER. I SET ASIDE THE ORDERS OF THE LOWER AUTHORITIES AND REMIT THE ISSUE BACK TO THE FILE OF ITA NO. 2425/MDS/2016 :- 6 -: THE ASSESSING OFFICER FOR CONSIDERATION AFRESH IN ACCORDANCE WITH LAW. 10. IN THE RESULT, APPEAL OF THE ASSESSEE IS PARTLY ALL OWED FOR STATISTICAL PURPOSE. ORDER PRONOUNCED ON WEDNESDAY, THE 12 TH DAY OF APRIL, 2017, AT CHENNAI. SD/- ( . ) (ABRAHAM P. GEORGE) / ACCOUNTANT MEMBER #$ / CHENNAI %& / DATED:12TH APRIL, 2017 KV &' ()*) / COPY TO: 1 . / APPELLANT 3. +,- / CIT(A) 5. )./ 0 / DR 2. / RESPONDENT 4. + / CIT 6. /12 / GF