ITO, Rohtak V. Shri Pawan Lumar, Rohtak

ITA 2487/DEL/2011

• Counselvise Citation: 248720114 RSA 2011
• Duration Of Justice: 3 year(s) 3 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-08-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: F
• Next Hearing Date: 07-08-2014
• Assessment Year: 2007-2008
• Appeal Filed On: 13-05-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MANOJ KUMAR CHOPRA
• Assessee Lawyers: NAVEEN GUPTA
• Keywords: Source of fund; Additional evidence
• Section: 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH F, NEW DELHI BEFORE SMT. DIVA SINGH, JUDICIAL MEMBER & SHRI J.S. REDDY, ACCOUNTANT MEMBER ITA NO. 2487/DEL/2011 ASSESSMENT YEAR: 2007-08 ITO, VS. PAWAN KUMAR, WARD-2, 476/26, ROHTAK. JAWAHAR NAGAR, ROHTAK. AFWPK1903P (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI MANOJ KUMAR CHOPRA, SR. DR RESPONDENT BY : SH. NAVEEN GUPTA, ADV. ORDER PER DIVA SINGH, J.M. THIS IS AN APPEAL FILED BY THE REVENUE AGAINST THE ORDER DATED 03/03/2011 OF CIT(A)-ROHTAK PERTAINING TO 2007-08 A SSESSMENT YEAR ON THE FOLLOWING GROUNDS: 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD.CIT(A) HAS ERRED IN LAW AND FACTS IN DELETING TH E ADDITION OF RS. 16,55,500/- MADE BY AO ON ACCOUNT OF UNEXPLAINED CA SH DEPOSITS IN BANK. THE ASSESSEE FAILED TO EXPLAIN THE DEPOSITS IN BANK DESPITE SUFFICIENT OPPORTUNITIES ALLOWED TO HIM DURING ASSE SSMENT PROCEEDINGS; 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E, THE LD. CIT(A) HAS ERRED IN LAW AND FACTS IN DELETING THE A DDITION OF RS. 16,55,500/- MADE BY AO ON ACCOUNT OF UNEXPLAINED CA SH DEPOSITS IN BANK, OVERLOOKING THE FACTS NARRATED BY AO IN THE R EMAND REPORT. ITA NO. 2487/D/2011 PAWAN KUMAR 2 2. THE RELEVANT FACTS OF THE CASE ARE THAT THE ASSE SSEE RETURNED AN INCOME OF RS. 98,560/- WHICH WAS SELECTED FOR SCRUT INY UNDER CASS. NOTICES U/S 143(2) WERE ISSUED AND SERVED UPON THE ASSESSEE IN RESPONSE THERE TO THE ASSESSEE WAS REPRESENTED BY LD. AR ON 21/10/2009 ON WHICH DATE THE HEARING WAS ADJOURNED. ON 26/10/2009 THE ASSESSEE ATTENDED ALONG WITH HIS AR AND FILED A WRITTEN REPLY. HOWEV ER, THE AO PROCEEDED TO ASSESS THE INCOME U/S 144. FOR READY REFERENCE WE REPRODUCE THE RELEVANT FINDINGS FROM THE ASSESSMENT ORDER: 1.6 NOTICE U/S 143(2)/142(1) DATED 8.10.2009 FOR 21.1 0.2009 WAS ISSUED BUT ON THE DATE OF HEARING SHRI MUKESH H ANDA ATTENDED THE PROCEEDINGS AND THE CASE WAS ADJOURNED TO 26.10 .2009. ON 26.10.2009 SHRI PAWAN KUMAR ALONG WITH SHRI MUKESH HANA ADVOCATE ATTENDED THE PROCEEDINGS AND FILED A WRITT EN REPLY. 2. SUFFICIENT OPPORTUNITIES HAVE BEEN ALLOWED TO TH E ASSESSEE TO EXPLAIN THE DEPOSITS IN BANK BUT HE FAILED TO DO SO . THE ASSESSMENT IS THEREFORE, MADE U/S 144 OF THE INCOME TAX ACT TO THE BEST OF MY JUDGMENT ON THE BASIS OF MATERIAL ON RECORDS. 3. THE ASSESSEE IS A LIC AGENT. THE ASSESSEE DECLA RED NET PROFIT OF RS. 98560/- FROM GROSS RECEIPTS OF RS. 169577/-. COPY OF BANK ACCOUNT OBTAINED AND DEPOSITS THEREIN HAS BEEN EXAM INED. DURING THE YEAR UNDER CONSIDERATION THE ASSESSEE DEPOSITED CASH OF RS. 16,55,500/- IN HIS ACCOUNT MAINTAINED WITH AXIS BAN K, ROHTAK. THE ASSESSEE WAS REQUIRED TO EXPLAIN THE SOURCE OF DEPO SIT. NO EXPLANATION HAS BEEN OFFERED DESPITE SO MANY OPPORT UNITIES ALLOWED TO THE ASSESSEE. UNEXPLAINED CASH DEPOSIT OF RS. 1 6,55,500/- IS THEREFORE, ADDED IN THE TOTAL INCOME OF THE ASSESSE E. 3. AGGREIVED BY THIS THE ASSESSEE CAME IN APPEAL BE FORE THE FIRST APPELLATE AUTHORITY WHERE ON BEHALF OF THE ASSESSEE FRESH EVIDENCE UNDER RULE 46A WAS FILED STATING THAT THE DOCUMENTS COUL D NOT BE FILED EARLIER AS THEY WERE IN THE POSSESSION OF SHRI RAVINDRA SINGH KADIAN. THE SAID ITA NO. 2487/D/2011 PAWAN KUMAR 3 EVIDENCES WERE ADMITTED AND REMANDED THE SAME TO T HE AO. THE CIT(A) CONSIDERING THE EXPLANATION OF THE ASSESSEE AND THE REMAND REPORT OF THE AO HELD THAT THE SOURCE FOR CASH DEPOSIT IN THE BAN K ACCOUNT OF THE ASSESSEE WERE MAINLY FROM SHRI RAVINDRA SINGH KADIA N FOR MAKING PAYMENT OF LIC PREMIUM AND THE SOURCE OF FUNDS IN THE HANDS OF SHRI RAVINDRA SINGH KADIAN STOOD EXPLAINED THE ADDITION AS SUCH WAS DEL ETED. 4. AGAINST THIS ACTION THE REVENUE IS IN APPEAL BEF ORE THE TRIBUNAL. 5. LD. SR. DR RELIES UPON THE ASSESSMENT ORDER. T HE LD. AR ON THE OTHER HAND RELIED UPON THE IMPUGNED ORDER. 6. WE HAVE HEARD THE RIVAL SUBMISSIONS AND HAVE TAKEN OURSELVES THROUGH THE MATERIAL AVAILABLE ON RECORD. ON A CONSIDERATI ON THEREOF WE ARE OF THE VIEW THAT THE IMPUGNED ORDER IN THE FACTS AS THEY S TAND DESERVES TO BE UPHELD. IT IS SEEN THAT THE CIT(A) IN PARA 3.1 & 3 .2 AFTER REFERRING TO THE FRESH EVIDENCE HAS PROCEEDED TO ADMIT THE SAME AND REMAND ED THE SAME TO THE AO. THE EXPLANATION OF THE ASSESSEE IS FOUND RECOR DED IN PARA 3.3 OF HIS ORDER AND THE OBJECTIONS OF THE AO IN THE REMAND RE PORT ARE ALSO FOUND RECORDED IN PARA 3.4 OF HIS ORDER. FOR READY REFER ENCE WE REPRODUCE THE SAME HEREUNDER: 3.1 REGARDING THE ADDITIONS MADE BY THE AO, THE A R SOUGHT THE ADMISSION OF FOLLOWING DOCUMENTS AS ADDITIONAL EVID ENCE U/R 46A AS THESE DOCUMENTS WERE NOT IN THE POSSESSION OF THE A PPELLANT BUT IN THE POSSESSION OF SH. RAVINDER SINGH KADIAN: (I) CERTIFICATE FROM SH. RAVINDER SINGH KADIAN (II) BANK STATEMENT OF SH. RAVINDER SINGH KADIAN (III) STATUS REPORT OF TWO LIC POLICIES OF SH. RAVI NDER SINGH KADIAN. ITA NO. 2487/D/2011 PAWAN KUMAR 4 THE CERTIFICATE OF SH. RAVINDER SINGH KADIAN STATE S THAT HE HAS GIVEN RS. 2.50 LAKH IN CASH TO THE APPELLANT ON 22.6.2006 TO DEPOSIT IN HIS LIC POLICY NUMBER 174984904 AS ADDI TIONAL PREMIUM. FURTHER, HE HAS GIVEN RS. 11.00 LACS IN C ASH TO THE APPELLANT ON 3.7.2006 TO DEPOSIT FOR HIS LIC POLICY OF RS. 15.00 LACS. THIS AMOUNT OF RS. 11.00 LACS WAS GIVEN IN CASH AFT ER WITHDRAWING FROM HIS BANK A/C NO. 900056, CORPORATION BANK, ROH TAK ON 3.7.2006. 3.2 THE ABOVE MENTIONED ADDITIONAL EVIDENCE HAS BEEN AD MITTED IN TERMS OF THE PROVISIONS OF RULE 46A AND REMANDED TO THE AO FOR HIS REPORT. THE REMAND REPORT OF THE AO AND THE RE JOINDER OF THE APPELLANT HAVE BEEN TAKEN ON RECORD. 3.3 BEFORE ME, THE AR SUBMITTED THAT THE APPELLANT, BEI NG AN LIC AGENT, SOMETIMES USED TO ACCEPT CASH FROM HIS CUSTO MERS, GET IT DEPOSITED IN HIS BANK ACCOUNT AND PAY LIC PREMIUM O F THE CUSTOMERS. DURING THE YEAR UNDER REFERENCE, THE AP PELLANT ACCEPTED CASH OF TOTAL RS. 13.50 LACS FROM SH. RAVINDER SING H KADIAN, GOT DEPOSITED IN HIS BANK A/C AND PAID THE LIC PREMIUM FROM HIS BANK ACCOUNT. THE APPELLANT ACCEPTED CASH OF RS. 2.50 L ACS ON 22.6.2006 FROM SH. KADIAN, DEPOSITED IN HIS BANK ACCOUNT ON 2 2 ND & 23 RD OF JUNE, 2006 AND PAID LIC PREMIUM OF RS. 1.00 LAC AND RS. 1.50 LACS ON 23.6.2006 THEREFROM. HE FURTHER ACCEPTED CASH O F RS. 11.00 LACS FROM SH. RAVINDER SINGH KADIAN ON 3.7.2006, DEPOSIT ED RS. 9.00 LACS ON 3.7.2006 AND RS. 2.00 LACS ON 25.8.2006 IN HIS BANK ACCOUNT AND PAID THE LIC PREMIUM OF RS. 15.00 LACS OF SH. R AVINDER SINGH KADIAN ON 7.7.2006. THE REMAINING SMALL CASH DEPOS ITS WERE MADE OUT OF PAST YEARS SAVINGS. 3.4 AS PER THE REMAND REPORT OF THE AO DATED 7.2.2011, THE AO RECORDED SWORN STATEMENT OF SH. RAVINDER SINGH KADI AN WHEREIN HE CONFIRMED THE CASH PAYMENTS TO THE APPELLANT. AS P ER HIM, LIC JIWAN PLUS POLICY FOR THE PREMIUM OF RS. 15.00 LACS WAS EXPIRING ON 30.6.2006 AND IN ORDER TO SAVE TIME, HE WITHDREW CA SH FROM HIS BANK A/C AND GIVE THE SAME TO THE APPELLANT WHO DEPOSITE D IT IN HIS BANK A/C AND ISSUED THE CHEQUE TO LIC. 6.1. IT IS SEEN THAT CONSIDERING THE ABOVE IN A SPE AKING MANNER, THE CIT(A) CAME TO A REASONED CONCLUSION WHICH HAS NOT BEEN ASSAILED BY THE REVENUE BY ANY CONTRARY EVIDENCE OR ARGUMENT. THE SAME IS REPRODUCED HEREUNDER FOR READY-REFERENCE:- ITA NO. 2487/D/2011 PAWAN KUMAR 5 4. I HAVE CONSIDERED THE ISSUE AND THE SUBMISSION S MADE BY THE AR. OUT OF THE RS. 2.50 LACS GIVEN BY SH. RAVINDER SINGH KADIAN ON 22.6.2006, THE APPELLANT DEPOSITED RS. 2.00 LACS ON 22.6.2006 AND RS. 40,000/- ON 23.6.2006 OUT OF WHICH HE PAID THE PREMIUMS TO LIC OF RS. 2.50 LACS ON BEHALF OF SH. RAVINDER SINGH KA DIAN. FROM THE CASH OF RS. 11.00 LACS GIVEN BY SH. RAVINDER SINGH KADIAN ON 3.7.2006, THE APPELLANT DEPOSITED RS. 9.00 LACS ON THE SAME DAY AND AN AMOUNT OF RS. 6.00 LACS WAS RECEIVED BY CHEQUE O N THE SAME DAY AND AN AMOUNT OF RS. 6.00 LACS WAS RECEIVED BY CHEQ UE FROM M/S MAHIMA LIFE INSURANCE FROM WHICH THE APPELLANT MADE PAYMENT OF LIC PREMIUM OF RS. 15.00 LACS ON 7.7.2006 ON BEHALF OF SH. RAVINDER SINGH KADIAN. FROM THE REMAINING RS. 2.00 LACS RECEIVED FROM SH. RAVINDER SINGH KADIAN, THE APPELLANT DEPOS ITED RS. 2.50 LACS ON 25.8.2006. THE SOURCES FOR DEPOSIT OF RS. 50,000/- WAS STATED TO BE FROM OUT OF THE PAST SAVINGS. FROM TH E ABOVE MENTIONED FACTS, IT IS APPARENT THAT THE SOURCES FOR CASH DEP OSITS IN THE BANK ACCOUNT OF THE APPELLANT WERE MAINLY FROM SH. RAVIN DER SINGH KADIAN FOR MAKING PAYMENT OF LIC PREMIUM. SINCE TH E SOURCES IN THE HANDS OF SH. RAVINDER SINGH KADIAN STAND FAIRLY EXPLAINED, THE CASH DEPOSITS IN THE BANK ACCOUNT OF THE APPELLANT ARE TREATED AS EXPLAINED AND, THEREFORE, THE ADDITION MADE BY THE AO IS DELETED AND THE GROUND OF APPEAL IS ALLOWED . 6.2. ON A PERUSAL OF THE ABOVE DETAILED REASONING A ND FINDING ARRIVED AT AFTER FOLLOWING THE PROCEDURES AND CONSIDERING THE RELEVANT MATERIAL AVAILABLE ON RECORD WHICH HAS ALSO BEEN PLACED IN THE PAPER B OOK FILED BEFORE US, WE FIND THAT THE REASONING ARRIVED AT BY THE CIT(A) ON FACTS WARRANTS NO INTERFERENCE. BEING SATISFIED BY THE REASONING AND FINDING THE DEPARTMENTAL GROUND IS DISMISSED. THE SAID ORDER WAS PRONOUNCED IN THE OPEN COURT AT THE TIME OF HEARING ITSELF. 7. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISM ISSED. THE ORDER IS PRONOUNCED IN THE OPEN COURT ON 29 TH OF AUGUST 2014. SD/- SD/- (J.S. REDDY) (DIVA SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED:29/ 08/2014 *KAVITA* ITA NO. 2487/D/2011 PAWAN KUMAR 6 COPY FORWARDED TO: - 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR, ITAT TRUE COPY BY ORDER, ASSISTANT REGISTRAR