Anand Subburam, CHENNAI V. ITO Non Corporate Ward 16(1), CHENNAI

ITA 2616/CHNY/2018

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 4273 (ITAT-CHENNAI)
• Duration Of Justice: 7 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-05-2019
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: B
• Assessment Year: 2015-2016
• Appeal Filed On: 11-09-2018
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: M. SUBASHRI
• Assessee Lawyers: PANDIAN
• Keywords: Unexplained cash credit; Salary income; Wrong claim
• Section: 68; 143(3); 142(1); 69A

Judgement Text

, ( ) , IN THE INCOME TAX APPELLATE TRIBUNAL , B (SMC) BENCH, CHENNAI . , . , BEFORE SHRI A.MOHAN ALANKAMONY, ACCOUNTANT MEMBER AND SHRI DUVVURU RL REDDY, JUDICIAL MEMBER ./ I.T.A.NO.2616/CHNY/2018 / ASSESSMENT YEAR: 2015-16) SHRI ANAND SUBBURAM, NO.8, 12 TH MAIN ROAD, VIJAYA NAGAR, VELACHERY, CHENNAI 600 042. VS THE INCOME TAX OFFICER, NON CORPORATE WARD 16(1), CHENNAI 34. PAN: AQEPA3316K ( /APPELLANT) ( /RESPONDENT) / APPELLANT BY : SHRI MS PANDIAN, CA / RESPONDENT BY : SMT. M. SUBASHRI, JCIT /DATE OF HEARING : 21.02.2019 /DATE OF PRONOUNCEMENT : 10.05.2019 / O R D E R PER A. MOHAN ALANKAMONY, AM:- THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER PASSED BY THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS)-4, CHENNAI, DATED 06.07.2018 IN ITA NO.33/2017-18/A.Y.2015- 16/CIT(A)-4 FOR THE ASSESSMENT YEAR 2015-16 PASSED U/S.250(6) R.W.S. 143(3) OF THE ACT. 2. THE APPEAL WAS FILED BY THE ASSESSEE WITH A DELAY OF FOUR DAYS. THE ASSESSEE HAS FILED A CONDONATION PETITION STATING THAT HE WAS PRE-OCCUPIED WITH OFFICE WORK AND BY OVERSIGHT FAILED TO 2 ITA NO.2616/CHNY/2018 INTIMATE HIS AUDITOR TO FILE THE APPEAL. HENCE IT WAS PLEADED THAT THE DELAY OF FOUR DAYS IN FILING THE APPEAL MAY BE CONDONED. THE LD. DR STRONGLY OBJECTED TO THE SUBMISSION OF THE LD. AR. AFTER HEARING BOTH SIDES, THOUGH WE DO NOT APPRECIATE THE LAPSE ON THE PART OF THE ASSESSEE TO FILE THE APPEAL WITHIN THE STIPULATED PERIOD, IN THE INTEREST OF JUSTICE, WE HEREBY CONDONE THE DELAY OF FOUR DAYS IN FILING THE APPEAL AND PROCEED TO HEAR THE CASE ON MERITS. 3. THE ASSESSEE HAS RAISED FOUR GROUNDS IN HIS APPEAL HOWEVER THE CRUXES OF THE ISSUES ARE THAT THE ASSESSMENT ORDER PASSED UNDER SEC.143(3) OF THE ACT BY THE LD.AO IS ARBITRARY AND IS AGAINST LAW AND HENCE ERRONEOUS AND UNTENABLE IN LAW AND FURTHER THE LD.CIT(A) HAS ERRED IN CONFIRMING THE ADDITION MADE BY THE LD.AO AMOUNTING TO RS.1,81,000/- U/S. 68 OF THE ACT TOWARDS CASH DEPOSITS IN BANK ACCOUNT AND UNEXPLAINED CREDIT IN THE BANK PASSBOOK OF THE ASSESSEE FOR RS.3,20,000/- AS UNDISCLOSED INCOME OF THE ASSESSEE U/S.69A OF THE ACT. 4. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE IS AN INDIVIDUAL EMPLOYED WITH M/S. IBM INDIA PVT. LTD., EARNING SALARY INCOME, FILED HIS RETURN OF INCOME FOR THE ASSESSMENT YEAR 2015-16 3 ITA NO.2616/CHNY/2018 ON 14.07.2015 ADMITTING TOTAL INCOME OF RS.7,53,962/-. INITIALLY THE RETURN WAS PROCESSED U/S.143(1) OF THE ACT ON 19.08.2015. SUBSEQUENTLY THE CASE WAS SELECTED FOR SCRUTINY UNDER CASS AND NOTICE U/S.143(2) & 142(1) OF THE ACT WERE ISSUED ON 29.07.2016 & 20.02.2017 RESPECTIVELY. FINALLY ASSESSMENT ORDER WAS PASSED U/S.143(3) OF THE ACT ON 08.09.2017 WHEREIN THE LD.AO MADE SEVERAL ADDITIONS. ON REOPENING NO ARGUMENTS WERE ADVANCED BEFORE US BY THE LD.AR. HOWEVER ON PERUSING THE ORDER OF THE LD.AO WE ARE OF THE CONSIDERED VIEW THAT REOPENING OF THE ASSESSMENT PROCESSED U/S.143(1) IS NOT BAD IN LAW BECAUSE THROUGH CASS IT WAS REVEALED THAT THE ASSESSEE HAD DEALT IN HUGE SHARE TRANSACTIONS AND THE SOURCE OF THE INVESTMENTS IS REQUIRED TO BE VERIFIED. THEREFORE WE HOLD THIS ISSUE AGAINST THE ASSESSEE. 5. ADDITION U/S.68 OF THE ACT FOR RS.1,81,000/-:- DURING THE COURSE OF SCRUTINY ASSESSMENT PROCEEDINGS, IT WAS OBSERVED BY THE LD.AO THAT THE ASSESSEE HAD MADE CASH DEPOSITS IN HIS SAVINGS BANK ACCOUNT MAINTAINED WITH HDFC BANK FROM SEVERAL LOCATIONS DURING THE PERIOD 29.09.2014 TO 27.12.2014 AGGREGATING TO RS.1,81,000/-. ON QUERY THE ASSESSEE HAD CLARIFIED THAT THE AMOUNT DEPOSITED IN THE BANK WAS CASH-TPT WHICH IS AN 4 ITA NO.2616/CHNY/2018 ONLINE TRANSACTION BEING THE AMOUNT TRANSFERRED FROM THE ASSESSEES WIFE ACCOUNT AND CERTAIN AMOUNT WERE FROM HIS SAVINGS AND BORROWED FUNDS. SINCE THE ASSESSEE COULD NOT FURNISH ANY FURTHER EVIDENCE OR SUBMIT CONFIRMATION STATEMENTS, THE LD.AO ADDED THE AGGREGATE AMOUNT OF RS.1,81,000/- AS THE UNEXPLAINED CASH DEPOSIT U/S.68 OF THE ACT. ON APPEAL, THE LD.CIT(A) CONCURRED WITH THE VIEW OF THE LD.AO AND CONFIRMED HIS ORDER. 6. ADDITION U/S.69A OF THE ACT FOR RS.3,20,000/-:- DURING THE COURSE OF SCRUTINY ASSESSMENT PROCEEDINGS, IT WAS OBSERVED BY THE LD.AO THAT AN AMOUNT OF RS.2,50,000/- AND RS.70,000/- WAS CREDITED IN THE ASSESSEES HDFC BANK PASSBOOK ON 17.05.2017 AND 11.02.2015 RESPECTIVELY BEING THE AMOUNT RECEIVED FROM MR.YAZH TAMIZHTHIRAI. ON QUERY, THE ASSESSEE HAD CLARIFIED THAT THE AMOUNT DEPOSITED IN THE BANK WAS CASH-TPT WHICH IS AN ONLINE TRANSACTION BEING THE AMOUNT TRANSFERRED FROM THE ASSESSEES WIFE ACCOUNT AND CERTAIN AMOUNT WERE FROM HIS SAVINGS AND BORROWED FUNDS. SINCE THE ASSESSEE COULD NOT FURNISH ANY FURTHER EVIDENCE OR SUBMIT CONFIRMATION STATEMENTS, THE LD.AO ADDED THE AGGREGATE AMOUNT OF RS.3,20,000/- AS THE UNEXPLAINED 5 ITA NO.2616/CHNY/2018 CASH DEPOSIT U/S.69A OF THE ACT. ON APPEAL, THE LD.CIT(A) CONCURRED WITH THE VIEW OF THE LD.AO AND CONFIRMED HIS ORDER. 7. BEFORE US THE LD.AR SUBMITTED THAT THE ASSESSEE BEING INDIVIDUAL AND EARNING SALARY INCOME WAS NOT BOUND TO MAINTAIN BOOKS OF ACCOUNTS. HE FURTHER SUBMITTED THAT THE ASSESSEE EARNS SALARY INCOME MORE THAN RS.10 LAKHS PER ANNUM. THE LR FURTHER SUBMITTED THAT THOUGH THE ASSESSEE HAD SUBMITTED HIS BANK STATEMENTS IN ORDER TO EXPLAIN HIS SOURCE OF INCOME THE LD.REVENUE AUTHORITIES WERE NOT CONVINCED AS THE ASSESSEE HAD NOT PRODUCED PROPER BOOKS OF ACCOUNTS AND CONFIRMATION STATEMENTS. THE LD.AR FURTHER ARGUED THAT FROM THE BANK STATEMENT ITSELF, IT IS EVIDENT THAT THE ASSESSEE HAS SUFFICIENT SOURCE FOR THE AMOUNT DEPOSITED IN HIS BANK ACCOUNT. THE LD.DR ON THE OTHER HAND RELIED ON THE ORDER OF THE LD.AO AS WELL AS THE LD.CIT(A). 8. WE HAVE HEARD THE RIVAL SUBMISSIONS AND CAREFULLY PERUSED THE MATERIALS ON RECORD. IT IS AN UNDISPUTED FACT THAT THE ASSESSEES SALARY INCOME IS MORE THAN RS.10 LAKHS PER ANNUM. IN THIS SITUATION WE ARE OF THE VIEW THAT ADDITION OF RS.1,81,000/- AND RS.3,20,000/- INVOKING THE PROVISIONS OF SECTION 68 & 69A OF THE ACT IS NOT WARRANTED JUST BECAUSE THE ASSESSEE HAS NOT MAINTAINED BOOKS OF 6 ITA NO.2616/CHNY/2018 ACCOUNTS WHICH IS NOT MANDATORY. MOREOVER FROM THE FACTS OF THE CASE IT CAN BE SAFELY PRESUMED THAT THE ACCUMULATED INCOME EARNED BY THE ASSESSEE FROM HIS SALARY INCOME WOULD BE SUFFICIENT TO COVER UP THE AGGREGATE AMOUNT OF RS.1,81,000/- & RS.3,20,000/. IT APPEARS THAT THE WRONG CLAIM OF HRA MADE BY THE ASSESSEE IN HIS RETURN OF INCOME FOR RS.1,10,785.87 MIGHT HAVE IRKED THE LD.AO TO ADVANCE SUCH APPROACH TOWARDS THE ASSESSEE. IN SUCH SITUATION, WE ARE OF THE VIEW THAT THE ENTIRE RESPONSIBILITY CANNOT BE THRUST ON THE ASSESSEE BECAUSE THEY ARE NOT EXPERT IN TAX MATTERS AND ARE GUIDED THROUGH PROFESSIONALS WHO AT TIMES INDULGE IN UNETHICAL PRACTICE AND SOMETIMES MAYBE AT THE INSISTENCE OF THE ASSESSEE. THEREFORE IN THE INTEREST OF JUSTICE, WE HEREBY DIRECT THE LD.AO TO DELETE THE ADDITION OF RS.1,81,000/- & RS.3,20,000/- MADE IN THE HANDS OF THE ASSESSEE. 9. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS PARTLY ALLOWED. ORDER PRONOUNCED ON THE 10 TH MAY, 2019 AT CHENNAI. SD/- SD/- ( ) (DUVVURU R.L REDDY) /JUDICIAL MEMBER ( . ) (A. MOHAN ALANKAMONY) / ACCOUNTANT MEMBER 7 ITA NO.2616/CHNY/2018 /CHENNAI, /DATED 10 TH MAY, 2019 RSR /COPY TO: 1. /APPELLANT 2. /RESPONDENT 3. ( )/CIT(A) 4. /CIT 5. /DR 6. /GF