DCIT, Mathura V. Smt. Meenakshi Agarwal W/o, Mathura

ITA 265/AGR/2009

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 7044 (ITAT-AGRA)
• Duration Of Justice: 1 year(s) 10 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-05-2011
• Appeal Filed By: Department
• Order Result: Partly Allowed
• Bench Allotted: DB
• Next Hearing Date: 03-05-2011
• Assessment Year: 2005-2006
• Appeal Filed On: 18-06-2009
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Assessee Lawyers: SAHRI RAJIV BANSAL
• Keywords: Income from undisclosed sources; Assessment record
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AGRA BENCH, AGRA BEFORE SHRI P.K. BANSAL, ACCOUNTANT MEMBER AND SHRI H.S. SIDHU, JUDICIAL MEMBER ITA NO.265/AGR/2009 ASST. YEAR: 2005-06 DY. COMMISSIONER OF INCOME TAX-3, VS. SMT. MEENAKS HI AGRAWAL, MATHURA. W/O. SHRI MADHAV PRASAD AGRAWAL, 115, SHRI RADHA BRIJ MOHAN MANDIR, LOI BAZAR, VRINDAVAN, MATHURA. (PAN : AAVPA 2958 G). (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI VINOD KUMAR JR. D.R. RESPONDENT BY : SAHRI RAJIV BANSAL, ADVOCATE ORDER PER H.S. SIDHU, J.M. : THE REVENUE HAS FILED THE PRESENT APPEAL AGAINST TH E ORDER DATED 16.03.2009 PASSED BY THE LD. CIT(A)-I, AGRA ON THE FOLLOWING G ROUNDS :- 1(A) THAT THE CIT (APPEALS)-I, AGRA HAS ERRED IN L AW IN DELETING ADDITION OF ` 10,12,968/- MADE ON ACCOUNT OF BOGUS LONG TERM CAPI TAL GAINS ON SALE OF SHARES, WITHOUT PROPERLY APPRECIAT ING THE FACTS OF THE CASE; (B) IN DOING SO THE CIT(APPEALS)-I, AGRA HAS ERRED IN LAW AND ON FACTS EVEN THOUGH THE ASSESSEE FAILED TO PROVE THE GENUINENESS OF THE CLAIMED SHARE TRANSACTIONS FOR THE REASONS GIVEN BY THE A.O. IN THE ASSESSMENT ORDER; 2 (C) THAT THE CIT(APPEALS)-I, AGRA HAS ERRED IN LAW AND ON FACTS IN DELETING THE AFORESAID ADDITION BY ADMITTING ADDITI ONAL EVIDENCE (WHICH WAS NOT PRODUCED BEFORE THE (A.O.), WITHOUT ALLOWING THE A.O. A REASONABLE OPPORTUNITY AS PROVIDED IN RULE 46A(3) OF IT RULES, 1962; 2. (A) THAT THE CIT(APPEALS)-I, AGRA HAS ERRED IN L AW IN DELETING ADDITION OF ` 69,000/- (COMPRISED BOTH RECEIPT AND REPAYMENT OF ` 34,500/-) MADE ON ACCOUNT OF BOGUS CASH LOANS (UNSE CURED LOANS) OF ` 17,000/- AND ` 17,500/- ALLEGEDLY TAKEN FROM SH. VRINDABAN DAS AND SH. GUDDU RESPECTIVELY, WITHOUT PROPERLY APPREC IATING THE FACTS OF THE CASE; (B) IN DOING SO THE CIT(APPEALS)-I, AGRA HAS ERRED IN LAW AND ON FACTS EVEN THOUGH THE LENDERS (SH. VRAINDABAN DAS A ND SH. GUDDU), WHILE EXAMINED ON OATH DURING THE ASSESSMENT PROCEE DINGS, CATEGORICALLY DENIED OF HAVING GIVEN ANY LOAN TO TH E ASSESSEE; 3. THAT THE APPELLANT CRAVES LEAVE TO ADD OR DELETE OR ALTER OR MODIFY ANY ONE OR MORE GROUND(S) OF APPEAL DURING T HE APPELLATE PROCEEDINGS. 4. THAT THE ORDER OF THE CIT(APPEAL)-I, AGRA BEING ERRONEOUS IN LAW AND ON FACTS BE SET ASIDE AND THAT THE ORDER OF THE ASSESSING OFFICER BE RESTORED. 2. THE ASSESSEE FILED HER RETURN OF INCOME ON 21.03 .2006 SHOWING TOTAL INCOME OF ` 11,62,863/- WHICH WAS PROCESSED BY THE ASSESSING OF FICER UNDER SECTION 143(1) OF THE INCOME TAX ACT, 1961 (THE ACT HEREI NAFTER) ON 29.03.2006. THEREAFTER, THE CASE OF THE ASSESSEE WAS SELECTED F OR SCRUTINY AND NOTICE UNDER SECTION 143(2) WAS ISSUED ON 07.09.2007 WHICH WAS S ERVED UPON THE ASSESSEE. IN RESPONSE TO THE SAME, THE LD. AUTHORISED REPRESENTA TIVE OF THE ASSESSEE APPEARED AND PRODUCED BOOKS OF ACCOUNTS WHICH WERE EXAMINED BY THE ASSESSING OFFICER. 3 THE ASSESSEE DERIVES INCOME FROM HOUSE PROPERTY AND INCOME FROM OTHER SOURCES. THE ASSESSEE HAS ALSO SHOWN LONG TERM CAPITAL GAINS AT ` 9,70,468/- BECAUSE THE ASSESSEE HAS PURCHASED 9000 SHARES OF FOCUS INDUSTR IAL RESOURCES LIMITED FOR ` 45,540/- ON 12.01.2004 WHICH WAS SOLD FOR ` 10,16,008/- ON 04.03.2005. THE DIFFERENCE BETWEEN SALE AND PURCHASE OF SHARES AMOU NTING TO ` 9,70,468/- HAS BEEN TREATED BY THE ASSESSEE AS LONG TERM CAPITAL GAIN A ND OFFERED THE SAME FOR TAXATION @ 10%. THE ASSESSEE WAS REQUIRED TO PROVE THE GENUINENESS OF THE PURCHASE AND SALE OF SHARES. TO PROVE THE SAME, TH E ASSESSEE FILED VARIOUS DOCUMENTARY EVIDENCES BEFORE THE ASSESSING OFFICER WHICH HE HAS SHOWN IN THE ASSESSMENT ORDER PASSED UNDER SECTION 143(3) OF THE ACT ON 28.12.2007. AFTER CONSIDERING ALL THE EVIDENCES PRODUCED BY THE ASSES SEE AS WELL AS IN VIEW OF VARIOUS DECISIONS RENDERED BY THE HONBLE SUPREME C OURT OF INDIA, THE ASSESSING OFFICER WAS OF THE VIEW THAT THE TRANSACTION SHOWN BY THE ASSESSEE IS BOGUS AND THE AMOUNT OF ` 10,12,968/- STATED TO HAVE BEEN RECEIVED BY DEMAND DRAFT ON 19.07.2005 IS NOTHING BUT THE INCOME OF THE ASSESSE E FROM UNDISCLOSED SOURCES SHOWN UNDER THE GARB OF BOGUS CAPITAL GAIN ENTRY AN D HE TREATED THE SAME AS INCOME OF THE ASSESSEE FROM UNDISCLOSED SOURCES AND TAXED ACCORDINGLY. THE ASSESSING OFFICER HAS ALSO MADE ADDITION OF ` 69,000/- ON ACCOUNT OF BOGUS CASH LOANS AND ADDED THE SAME AS INCOME FROM UNDISCLOSED SOURCES BEING CASH INTRODUCED AS RECEIPT/PAYMENT OF LOANS AND COMPLET ED THE ASSESSMENT IN DISPUTE BY PASSING THE ORDER DATED 28.12.2007 UNDER SECTION 143 OF THE ACT. AGGRIEVED BY 4 THE SAME, THE ASSESSEE FILED APPEAL BEFORE THE LD. FIRST APPELLATE AUTHORITY WHO, VIDE THE IMPUGNED ORDER DATED 16.03.2009, DELETED T HE ADDITION IN DISPUTE BY ALLOWING THE APPEAL FILED BY THE ASSESSEE. NOW, TH E REVENUE BEING AGGRIEVED BY THE IMPUGNED ORDER, FILED THE PRESENT APPEAL. 3. AT THE TIME OF HEARING THE LD. DEPARTMENTAL REPR ESENTATIVE RELIED UPON THE ORDER PASSED BY THE A.O. AND STATED THAT THE LD. FI RST APPELLATE AUTHORITY HAS DELETED THE ADDITION IN DISPUTE ON THE BASIS OF FRE SH EVIDENCE WHICH WAS NOT FILED BY THE ASSESSEE BEFORE THE ASSESSING OFFICER WHICH IS CONTRARY TO RULE 46A(3) OF THE INCOME TAX RULES, 1962. 4. ON THE CONTRARY, THE LD. AUTHORISED REPRESENTATI VE OF THE ASSESSEE RELIED UPON THE ORDER PASSED BY THE LD. FIRST APPELLATE AU THORITY. HE FURTHER STATED THAT THE ASSESSEE HAS NOT FILED ANY FRESH EVIDENCE BEFOR E THE LD. FIRST APPELLATE AUTHORITY. HE STATED THAT THE ASSESSEE HAS FILED W RITTEN SUBMISSION ALONG WITH SUPPORTING DOCUMENTARY EVIDENCES BEFORE THE LD. FIR ST APPELLATE AUTHORITY ONLY TO SUPPORT THE WRITTEN ARGUMENTS FILED BEFORE THE CIT( A). NO FRESH EVIDENCE HAS BEEN FILED BY THE ASSESSEE BEFORE THE LD. FIRST APPELLAT E AUTHORITY. HE DREW OUR ATTENTION TOWARDS PARAGRAPH NO.3.1 OF THE IMPUGNED ORDER AS WELL AS THE ASSESSMENT ORDER. HE ALSO DREW OUR ATTENTION TOWAR DS EACH AND EVERY DOCUMENTS FILED BY THE ASSESSEE BEFORE THE LD. FIRST APPELLAT E AUTHORITY FOR PROVING THAT NO 5 FRESH EVIDENCE HAS BEEN FILED BY THE ASSESSEE BEFOR E THE LD. FIRST APPELLATE AUTHORITY. ALL DOCUMENTARY EVIDENCES ARE ALREADY A VAILABLE WITH THE ASSESSING OFFICER. HE FURTHER STATED THAT THE LD. FIRST APPE LLATE AUTHORITY APPRECIATED THE EVIDENCES ALONG WITH THE ARGUMENTS ADVANCED BY THE ASSESSEES COUNSEL AND DELETED THE ADDITION IN DISPUTE. HE RELIED UPON TH E ORDER OF THE LD. FIRST APPELLATE AUTHORITY. 5. AS REGARDS TO THE OTHER ADDITION OF ` 69,000/-, THE LD. AUTHORISED REPRESENTATIVE OF THE ASSESSEE STATED THAT THE ASSE SSEE HAS FILED CONFIRMATION LETTERS FROM ALL THE PERSONS FROM WHOM THE ASSESSEE HAS TAK EN THE AMANAT AND THE ASSESSEE HAS ALSO PRODUCED THESE PERSONS BEFORE THE ASSESSING OFFICER FOR MAKING STATEMENTS. THEREFORE, THE LD. FIRST APPELLATE AUT HORITY HAS RIGHTLY DELETED THE ADDITION OF ` 69,000/-. HE SUPPORTED THE ORDER OF THE LD. FIRST APPELLATE AUTHORITY ON BOTH THE ISSUES IN DISPUTE RAISED BY THE REVENUE IN THE GROUNDS OF APPEAL. 6. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE R ELEVANT RECORDS AVAILABLE WITH US AND WE ARE OF THE CONSIDERED OPINION THAT T HE LD. FIRST APPELLATE AUTHORITY HAS RIGHTLY APPRECIATED THE EVIDENCES PRODUCED BY T HE ASSESSEE WITH HER WRITTEN SUBMISSIONS. 6 7. THE LD. COUNSEL FOR THE ASSESSEE HAS ALSO DRAWN OUR ATTENTION TOWARDS THE ORDER OF THE LD. FIRST APPELLATE AUTHORITY AT PARAG RAPH NO. 3.1, PAGE NOS.4 TO 6 AS WELL AS THE ASSESSMENT ORDER. HE ESTABLISHED THAT EACH AND EVERY DOCUMENT FILED BY THE ASSESSEE WITH WRITTEN SUBMISSION BEFORE THE LD. FIRST APPELLATE AUTHORITY ARE PART OF THE ASSESSMENT RECORDS. WE ARE FULLY CONVI NCED WITH THE SAME AND ARE OF THE OPINION THAT THE LD. FIRST APPELLATE AUTHORITY HAS RIGHTLY DELETED THE ADDITION OF ` 10,12,968/- BY APPRECIATING THE EVIDENCES PRODUCED BY THE ASSESSEE. THEREFORE, NO INTERFERENCE IS CALLED FOR IN THE WELL REASONED ORDER PASSED BY THE LD. FIRST APPELLATE AUTHORITY. WE DISMISS THE ISSUE INVOLVED IN GROUND NO.1 AND UPHOLD THE IMPUGNED ORDER. 8. AS REGARDS TO THE ADDITION OF ` 69,000/- DELETED BY THE LD. FIRST APPELLATE AUTHORITY, AFTER CONSIDERING THE ARGUMENTS ADVANCED BY THE LD. COUNSEL FOR THE ASSESSEE AS WELL AS THE LD. DEPARTMENTAL REPRESENTA TIVE ALONG WITH THE FINDING GIVEN BY THE REVENUE AUTHORITIES, WE ARE OF THE CON SIDERED OPINION THAT NO DOUBT THE ASSESSEE HAS FILED CONFIRMATION LETTER FROM ALL THE PERSONS FROM WHOM THESE DEPOSITS HAVE BEEN TAKEN BY THE ASSESSEE AND REPAYM ENT HAVE BEEN MADE TO THEM. THE ASSESSEE HAS ALSO PRODUCED THESE PERSONS BEFORE THE ASSESSING OFFICER FOR VERIFICATION, BUT THEY HAVE NOT CORROBORATED THE VE RSION OF THE ASSESSEE AND THEY DENIED BEFORE THE ASSESSING OFFICER WHEN THEY APPEA RED BEFORE HIM BY STATING THAT THEY HAVE NOT GIVEN LOAN TO THE ASSESSEE. FOR THE SAKE OF CONVENIENCE, THE FINDING 7 GIVEN BY THE LD. FIRST APPELLATE AUTHORITY ON THE I SSUE INVOLVED IN GROUND NO.2 AT PARAGRAPH NO.5, PAGE NOS.11 TO 13 ARE REPRODUCED AS UNDER :- 5. GROUND NO.13 TO 18: IN THESE GROUNDS, THE APPE LLANT HAS DISPUTED THE ADDITIONS OF ` 69,000/- COMPRISED OF THE FOLLOWING LOANS TAKEN AND REPAID IN CASH: SHRI VRINDABAN DAS ` 17,000/- RECEIVED ON 14.02.05 REPAID ON 31.03.05 SHRI GUDDU ` 17,500/- RECEIVED ON 15.02.05 REPAID ON 31.03.05. 5.1 IN THE ASSESSMENT ORDER, THE AO HAS STATED AS UNDER :- '4.1 WHEN STATEMENT OF ABOVE PERSONS WERE RECORDED, THEY HAVE CATEGORICALLY DENIED TO HAVE ANY TRANSACTION OF LOA N WITH THE ASSESSEE. THEREFORE, THE ASSESSEE HAS SHOWN BOGUS C ASH LOANS ON THE DATES MENTIONED ABOVE AND AGAIN ON 31.03.200 5 FOR ITS REPAYMENT. THEREFORE, THE AMOUNT OF ` 69,000/- IS ADDED BACK THE INCOME OF THE ASSESSEE AS INCOME FROM UNDISCLOS ED SOURCES BEING CASH INTRODUCED AS RECEIPT/PAYMENT OF LOANS. SINCE THE ASSESSEE HAS FURNISHED INACCURATE PARTICULARS OF HE R INCOME IN THIS REGARD, I AM SATISFIED THAT IT IS A FIT CASE F OR INITIATION OF PENALTY U/S. 271(L)(C) READ WITH SECTION 274 OF THE ACT ON THIS SCORE. ' 5.2 IN THE COURSE OF APPELLATE PROCEEDINGS, THE AR OF THE APPELLANT HAS OBJECTED TO THE ADDITIONS ON THE FOLLOWING GROU NDS:- - THE APPELLANT HAD SHOWN DEPOSITS OF 'AMANAT' WITH THE ASSESSEE BY THE FOLLOWING PERSONS: A. RAM SINGH B. VISHNU SHARMA C. VRINDABAN DAS __ D. MED PAL E. JEET RAM F. GUDDU __ G. RAJESH AGARWAL 8 CONFIRMATION LETTERS FROM ALL THE ABOVE PERSONS WER E FILED. ON 04.12.2007, THE ASSESSING OFFICER DIRECTED THE APPE LLANT TO PRODUCE THE AFORESAID PARTIES FOR VERIFICATION. ON 14.12.2007, THE SAID PARTIES ATTENDED AND THEIR STATEMENTS WERE RECORDED. - SHRI VRINDABAN DAS AND SHRI GUDDU HAVE SIGNED THE CONFIRMATION LETTERS THEREBY CONFIRMING THE DEPOSIT S. HOWEVER, BEFORE THE AO THEY HAVE DENIED GIVING ANY LOAN TO T HE APPELLANT. AS REGARDS SHRI GUDDU, HE HAS DENIED GIV ING ANY LOAN TO THE APPELLANT WHICH IS BECAUSE THE SAID AMO UNT WAS NOT A LOAN BUT AMANAT. AS REGARDS SHRI VRINDABAN DAS, IN ANSWER TO QUESTION NO.7 OF HIS STATEMENT RECORDED O N OATH ON 14.12.2007, HE HAS STATED THAT HE DOES NOT KNOW THE APPELLANT SMT. MEENAKSHI AGARWAL. BOTH THE QUESTION AS WELL A S THE ANSWER HAVE BEEN INSERTED IN THE STATEMENT AFTERWAR DS. THIS IS SO BECAUSE SHRI MADHAV PRASAD, HUSBAND OF THE APPEL LANT AND SHRI VRINDABAN DAS ARE BOTH EMPLOYEES OF SHRI HARI DAS AGARWAL OWNER OF MITTAL TODIA CO. - THE AO HAS ASKED THE ABOVE PERSONS WHETHER THEY H AVE GIVEN LOANS TO THE ASSESSEE WHICH THEY HAVE DENIED AS THE Y HAVE MERELY KEPT THE AMOUNTS AS AMANAT WITH THE APPELL ANT WHICH HAVE BEEN RETURNED ON 30.03.2005 AND NOT ON 31.03.2 005. ON THE ABOVE BASIS, ID. AR OF THE APPELLANT CONTEND ED THAT ` 69,000/-, COMPRISED OF BOTH RECEIPT AS WELL AS REPA YMENT OF THE SAME ` 34,500/-, HAS BEEN WRONGLY ADDED TO THE APPELLANT' S INCOME AND HENCE DESERVES TO BE DELETED. 5.3. I HAVE CONSIDERED THE RIVAL CONTENTIONS AND MY OBSERVATIONS ARE AS UNDER : - - ON PERUSAL OF THE ASSESSMENT RECORDS, IT IS SEEN THAT IN THE COURSE OF THE STATEMENTS OF THE ABOVE TWO PERSONS, RECORDED ON 14.12.2007, THEY WERE NOT CONFRONTED WITH THE CONFI RMATION LETTERS SUPPOSEDLY GIVEN BY THEM AND SUBMITTED BEFO RE THE AO BY THE APPELLANT ON 19.10.2007. THIS WAS PARTICULAR LY REQUIRED SINCE APPARENTLY THE LOANS WERE DENIED BY THE AFORE SAID PERSONS. 9 - THE CONFIRMATION LETTERS BEAR THE SIGNATURES OF T HE ALLEGED DEPOSITORS. THE ALLEGED DEPOSITORS HAVE NOT DENIED THE CONFIRMATION LETTERS GIVEN BY THEM TO THE ASSESSEE. THE DEPOSITOR SHRI VRINDABAN DAS IS THE COLLEAGUE OF TH E APPELLANTS HUSBAND AND HENCE MAY HAVE DENIED PERSO NAL ACQUAINTANCE WITH THE APPELLANT. - THE AO HAS NOT DISPUTED THE IDENTITY OF THE DEPOS ITORS WHO HAD BEEN PRODUCED BY THE APPELLANT HERSELF AS EVIDENT F ROM ORDER- SHEET ENTRY DATED 14.12.2007 WHICH IS EXTRACTED BEL OW: 14.12.2007: FURTHER ASSESSEE PRODUCE THE CASH CREDITOR NAMELY S HRI VRINDABAN DASS, SHRI MADPAL, SHRI VISHNU SHARMA AND SHRI GOODU, FOR VERIFICATION. THE REMAINING TWO PERSONS SHRI RAM SINGH AND SHRI JEET RAM CANNOT BE PRODUCED BECAUSE THEY HAVE LEFT VRINDAVAN. THE PERSON PRODUCED TODAY THEIR STA TEMENT HAVE BEEN RECORDED ON OATH. THE FACT THAT THE DEPONENTS WERE PRODUCED BY THE AP PELLANT AND THAT THEY CAME TO DEPOSE BEFORE THE AO SHOWS THAT T HEY WERE KNOWN TO THE APPELLANT/HER HUSBAND AND, THEREFORE, COULD BE PRODUCED BEFORE THE AO FOR EXAMINATION. - THE ADDITION OF THE IMPUGNED AMOUNT - BOTH ON ACC OUNT OF RECEIPT AS WELL AS REPAYMENT - IS NOT JUSTIFIED, AS EVEN OTHERWISE ONLY PEAK OF CREDITS CAN BE TAXED, IN THE PRESENT C ASE, THE PEAK BEING ` 34,500/- ONLY. IN VIEW OF THE FOREGOING, THE ADDITION OF ` 69,000/- IS NOT SUSTAINABLE AND HENCE DELETED. 9. AFTER GOING THROUGH THE AFORESAID FINDING GIVEN BY THE LD. FIRST APPELLATE AUTHORITY ON THE DELETION OF ` 69,000/-, WE ARE OF THE CONSIDERED OPINION THAT THE DEPOSITORS, WHO APPEARED BEFORE THE ASSESSING OFFIC ER, HAVE NOT CORROBORATED THE VERSION OF THE ASSESSEE AND THEY DENIED THAT THEY H AVE NOT GIVEN ANY LOAN TO THE 10 ASSESSEE. THEREFORE, WE ARE OF THE VIEW THAT THE L D. FIRST APPELLATE AUTHORITY HAS WRONGLY DELETED THE ADDITION IN DISPUTE. WE CANCEL THE ORDER ON THIS ISSUE AND UPHOLD THE ASSESSMENT ORDER IN RESPECT OF ADDITION OF ` 69,000/-. THUS, THE ISSUE INVOLVED IN GROUND NO.2 IS ALLOWED. 10. IN THE RESULT, APPEAL FILED BY THE REVENUE IS P ARTLY ALLOWED. (ORDER PRONOUNCED IN THE OPEN COURT ON 06.05.2011 ). SD/- SD/- (P.K. BANSAL) (H.S. SIDHU) ACCOUNTANT MEMBER JUDICIAL MEMBER PLACE: AGRA DATE: 6 TH MAY, 2011 PBN/* COPY OF THE ORDER FORWARDED TO: 1. APPELLANT 2. RESPONDENT BY ORDER 3. CIT CONCERNED 4. CIT (APPEALS) CONCERNED 5. DR, ITAT, AGRA BENCH, AGRA 6. GUARD FILE ASSISTANT REGISTRAR INCOME-TAX APPELLATE TRIBUNAL, AGRA TRUE COPY