Income Tax Officer Ward -1(2), RAIPUR (CG) V. Shri. Prahlad Rao Dodke, RAIPUR (CG)

ITA 246/BIL/2011

• Counselvise Citation: [2015] 134 COUNSELVISE.COM (IT) 0532 (ITAT-RAIPUR)
• Duration Of Justice: 3 year(s) 9 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-10-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2008-2009
• Appeal Filed On: 27-12-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: D K JAIN
• Assessee Lawyers: G S AGARWAL
• Keywords: Unexplained cash credit; Salary income; Source of fund
• Section: 143(3); 68

Judgement Text

, RAIPUR IN THE INCOME TAX APPELLATE TRIBUNAL, RAIPUR BEFORE S/SHRI G.D.AGARWAL( VP) & MUKUL KR. SHRAWAT (JM) . . , , ./ I.T.A. NO. 246/BLPR/2011 ( / ASSESSMENT YEAR : 2008 - 09 ) INCOME TAX OFFICER, WARD - 1(2), RAIPUR / VS. SHRI PRAHLAD RAO DODKE, C - 180, SECTOR - 5, SHAILENDRA, RAIPUR ./ ./ PAN/GIR NO. : ACUPD 2178 G ( / APPELLANT ) .. ( / RESPONDENT ) / APPELLANT BY : SHRI D.K .J AIN / RESPONDENT BY : SHRI G.S.AGARWAL / DATE OF HEARING :06 - 10 - 2015 / DATE OF PRONOUNCEMENT : 09 - 10 - 2015 / O R D E R PER MUKUL KR. SHRAWAT, JUDICIAL MEMBER THIS IS AN APPEAL FILED BY THE REVENUE ARISING OUT OF ORDER DATED 14.10.2011 OF THE LD CIT(A), RAIPUR AND THE GROUND RAISED IS AS UNDER: WHETHER IN LAW AND ON FACTS & CIRCUMSTANCES OF THE CASE, THE LD CIT(A) HAS ERRED IN DELETING THE ADDITION OF RS.15,00,000/ - MADE BY THE AO ON ACCOUNT OF UNEXPLAINED CASH CREDIT U/S.68 OF THE I.T.ACT, 1961. 2. FACTS IN BRIEF AS EMERGED FROM THE CORRESPONDING ASSESSMENT ORDER PASSED UNDER SECTION 143(3) OF THE ACT DATED 14.12.2010 WERE THAT THE ASSESSEE 2 I.T.A. NO.246/BLPR/2011 ASSESSMENT YEAR : 2008 - 09 IS A DEVELOPMENT OFFICER IN LIC OF INDIA AND EARNED SALARY INCOME FOR THE YEAR UNDER CONSIDERATION. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, IT WAS NOTICED BY THE AO THAT T HE APPELLANT HAD DEPOSITED RS.15,00,000/ - IN CASH ON THREE DIFFERENT DATES IN THE BANK ACCOUNT. IN COMPLIANCE OF THE SHOW CAUSE NOTICE, THE ASSESSEE HAS FURNISHED THE SOURCE OF DEPOSIT WHICH WAS EXAMINED BY THE AO. THE ASSESSEES EXPLANATION WAS THAT PAR T OF THE AMOUNT WAS OUT OF LIC HOUSING LOAN, PF LOAN, PAST YEARS SAVING, ETC. HOWEVER, THE AO WAS NOT CONVINCED. ACCORDING TO THE AO, IT WAS NOT POSSIBLE THAT SUCH A LARGE AMOUNT WAS KEPT IN CASH BY A SALARIED EMPLOYEE. THE AO HAS ALSO ALLEGED THAT THE LOAN TAKEN FROM LIC WAS SANCTIONED FOR A PARTICULAR PURPOSE, WHICH COULD NOT HAVE BEEN DEPOSITED IN CASH BY THE ASSESSEE IN ANY SAVING ACCOUNT. RESULTANTLY, BY INVOKING THE PROVISIONS OF SECTION 68 OF THE ACT, ADDITION OF RS.15,00,000/ - WAS MADE. 3. WHEN THE MATTER WAS CARRIED BEFORE THE FIRST APPELLATE AUTHORITY, THE LD CIT(A) HAS DISCUSSED THE SOURCE OF FUNDS AS EXPLAINED BY THE ASSESSEE ITEM - WISE IN DETAIL. IN RESPECT OF A SUM OF RS.7 LAKHS, IT WAS OBSERVED THAT A CHEQUE FROM LIC WAS ISSUED WHICH WAS DEPOSITED IN ICICI BANK AND AFTER WITHDRAWING FROM THAT ACCOUNT, THE ASSESSEE HAS DEPOSITED IN THE SB ACCOUNT IN QUESTION. THE ASSESSEE HAS FURNISHED THE BANK ACCOUNT OF ICICI BANK ESTABLISHING THAT THERE WAS A SYSTEMATIC WITHDRAWAL IN CASH WHICH WAS EXP LAINED AS CASH IN HAND TOWARDS THE SOURCE OF DEPOSIT. THE ASSESSEE HAS ALSO FURNISHED EVIDENCE OF PF LOAN BEFORE THE LD CIT(A). THE ASSESSEE HAS FURNISHED THE DETAILS OF WITHDRAWALS THROUGH ATM TO ESTABLISH THAT THE CASH WAS AVAILABLE WITH THE ASSESSEE. IN 3 I.T.A. NO.246/BLPR/2011 ASSESSMENT YEAR : 2008 - 09 RESPECT OF SAVING OF PAST YEARS, THE EXPLANATION OF THE ASSESSEE WAS THAT INTEREST FREE LOAN WAS GIVEN FROM TIME TO TIME TO CLOSE RELATIVES, WHICH WERE REFUNDED ON DEMAND TO BE DEPOSITED IN THE BANK. IT HAS ALSO BEEN EXPLAINED THAT THE ASSESSEE HAD NO T MADE ANY INVESTMENTS IN SHARES OR SECURITIES IN THE PAST. IT WAS THE ASSESSEES OWN MONEY WHICH WAS SAVED FROM SALARY INCOME AND DEPOSITED IN THE BANK. THE LD CIT(A) HAS ALSO DISCUSSED THE DECISION IN THE CASE OF SUMATI DAYAL VS CIT(1995) 214 ITR 801(S C) AND OPINED THAT THE EXPLANATION OF THE ASSESSEE WAS ALSO AN ACCEPTABLE HUMAN NATURE TO SAVE MONEY FROM SALARY INCOME AND RE - DEPOSITED IN THE BANK. FINALLY, THE IMPUGNED A DDITION WAS DELETED WHICH IS NOW CHALLENGED BEFORE US. 4. IN THE LIGHT OF ABOVE F ACTUAL BACKGROUND, WE HAVE HEARD BOTH THE SIDES. LD D.R. SHRI D.K.JAIN HAS SUPPORTED THE ACTION OF THE AO AND ARGUED THAT THE QUANTUM OF SAVINGS OF THE PAST YEARS WAS VERY HUGE, HENCE, NOT POSSIBLE FOR A SALARIED PERSON TO KEEP SUCH LARGE AMOUNT IN CASH F OR A SUCH LONGER PERIOD. IN HIS OPINION, IT WAS AGAINST THE HUMAN PROBABILITY, THEREFORE, THE ADDITION WAS RIGHTLY MADE BY THE AO. AS AGAINST THAT LD A.R. SHRI G.S.AGARWAL APPEARED AND FILED THE RELEVANT BANK ACCOUNTS TO DEMONSTRATE THAT THERE WERE REGUL AR WITHDRAWALS BY THE ASSESSEE WHICH WAS THE SOURCE OF DEPOSIT IN THE BANK. LD A.R. HAS EXPLAINED THAT THE ASSESSEE HAD JOINED LIC IN THE YEAR 1972 AND BECAME DEVELOPMENT OFFICER IN 1973. HIS SOURCE OF INCOME WAS SALARY FROM LIC AND INCENTIVES GIVEN BY S AID ORGANIZATION. DURING THE ENTIRE PERIOD OF SERVICE, HE HAS NOT INVESTED IN ANY OTHER ASSETS BUT PURCHASED A MIG HOUSE. LD A.R. HAS 4 I.T.A. NO.246/BLPR/2011 ASSESSMENT YEAR : 2008 - 09 ALSO DRAWN OUR ATTENTION ON THE SUMMARY OF CASH WITHDRAWALS WHICH WERE DEPOSITED IN THE BANK ACCOUNT IN QUESTION. ON A CAREFUL CONSIDERATION OF THE PAPER BOOK FILED BY THE ASSESSEE AND THE SUMMARY OF VARIOUS BANK STATEMENTS, WE ARE OF THE CONSIDERED OPINION THAT PRIMA FACIE, IT IS NOT JUSTIFIABLE TO RULE OUT THE PROBABILITY THAT THE ASSESSEE WOULD HAVE MADE SAVINGS FROM HI S SALARY INCOME. EVEN IF WE DISCUSS THE QUESTION OF HUMAN PROBABILITY, THEN ALSO THE BEHAVIOR OF THE ASSESSEE CAN BE CONSIDERED AS A HUMAN NATURE TO SAVE AMOUNT OUT OF THE SALARY INCOME AND IN CASE OF REQUIREMENTS USED THE SAME FOR AN INVESTMENT. IT IS NOT THE CASE OF THE REVENUE THAT ON ENQUIRY FROM RELATIVES THE EXPLANATION OF THE ASSESSEE WAS FOUND FALSE. HENCE, CONSIDERING THE TOTALITY OF THE FACTS AND CIRCUMSTANCES OF THE CASE, ESPECIALLY WHEN THE ASSESSEE IN QUESTION WAS A DEVELOPMENT OFFICER IN LIC OF INDIA, WE HEREBY HOLD THAT THERE WAS NO IRREGULARITY IN THE RELIEF GRANTED BY THE LD CIT(A), HENCE, SAME IS HEREBY CONFIRMED. RESULTANTLY, GROUND OF THE REVENUE IS DISMISSED. 5. IN THE RESULT, THE APPEAL REVENUE IS DISMISSED . A ORDER PRONOUNCED IN THE OPEN COURT ON 9/ 10/2015 . SD/ - SD/ - ( . . , ) ( , ) G . D . AGARWAL , VICE PRESIDENT MUKUL KR SHRAWAT , JUDICIAL MEMBER RAIPUR , DATED 9 / 10/2015 . . ./ PARIDA , SR. PS 5 I.T.A. NO.246/BLPR/2011 ASSESSMENT YEAR : 2008 - 09 / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT : INCOME TAX OFFICER, WARD - 1(2), RAIPUR 2. / THE RESPONDENT: SHRI PRAHLAD RAO DODKE, C - 180, SECTOR - 5, SHAILENDRA, RAIPUR 3. ( ) / THE CIT(A) - RAIPUR 4. / CIT , RAIPUR 5. , , / DR, ITAT, RAIPUR 6. / GUARD FILE. / BY ORDER, //TRUE COPY// SR. PS, ITAT, CAMP: RAIPUR