SURESH KUMAR SHARMA, NAVI MUMBAI V. ASST CIT CIR 10(3), MUMBAI

ITA 2755/MUM/2012

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 78968 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-05-2014
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: E
• Next Hearing Date: 12-05-2014
• Assessment Year: 2009-2010
• Appeal Filed On: 24-04-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: MATHURIA

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL E BENCH, MUM BAI , , BEFORE SHRI SANJAY ARORA, AM AND SHRI AMIT SHUKLA, JM ./ I.T.A. NO. 2755/MUM/2012 ( / ASSESSMENT YEAR: 2009-10) SURESH KUMAR S. SHARMA, BUNGALOW NO.2, JIMMY TOWER 1 & 2, CHS, SECTOR -18, KOPARKHAIRNE, NAVI MUMBAI-400 709 / VS. ASST. CIT, CIRCLE 10(3), 451, AAYAKAR BHAVAN, M. K. ROAD, MUMBAI-400 020 ' ./# ./PAN/GIR NO. AAQPS 5959 L ( '$ /APPELLANT ) : ( %&'$ / RESPONDENT ) '$ ' ( / APPELLANT BY : SHRI M. S. MATHURIA %&'$ ' ( / RESPONDENT BY : SHRI PITAMBAR DAS )* + ' , / DATE OF HEARING : 12.05.2014 -./ ' , / DATE OF PRONOUNCEMENT : 21.05.2014 / O R D E R PER SANJAY ARORA, A. M.: THIS IS AN APPEAL BY THE ASSESSEE DIRECTED AGAINST THE ORDER BY THE COMMISSIONER OF INCOME TAX (APPEALS)-22, MUMBAI (CIT(A) FOR SH ORT) DATED 25.01.2012, PARTLY ALLOWING THE ASSESSEES APPEAL CONTESTING ITS ASSES SMENT U/S.143(3)(II) OF THE INCOME TAX ACT, 1961 (THE ACT HEREINAFTER) FOR THE ASSESSMEN T YEAR (A.Y.) 2009-10 VIDE ORDER DATED 08.12.2011. 2. THE RELEVANT FACTS OF THE CASE ARE THAT CERTAIN CASH DEPOSITS WERE OBSERVED IN THE ASSESSEES, AN INDIVIDUAL, BANK ACCOUNT WITH ICICI BANK DURING THE RELEVANT YEAR. THE 2 ITA NO. 2755/MUM/2012 (A.Y. 2009-10) SURESH KUMAR S. SHARMA VS. ASST. CIT ASSESSEE EXPLAINED THE SAME THROUGH CASH WITHDRAWAL S FROM THE SAID BANK ITSELF. THE EXPLANATION WAS FOUND UNACCEPTABLE IN-AS-MUCH AS TH E WITHDRAWAL/S WERE SUBSEQUENT TO THE DATE OF THE DEPOSIT/S AND, TWO, THE CASH WITHDR AWAL/S WERE FOR MINOR AMOUNTS (RANGING FROM RS.3,000/- TO RS.10,000/-), AND WHICH WOULD ON LY BE FOR AN IMMEDIATE OR SOME PERSONAL PURPOSE, RATHER THAN FOR BEING ACCUMULATED FOR DEPOSIT IN LARGE SUMS SUBSEQUENTLY. NO CASH FLOW STATEMENT OR CASH BOOK, RECONCILING THE CASH FLOWS, WAS SUBMITTED. ACCORDINGLY, THE NET CASH DEPOSIT, I.E., THE EXCESS OF CASH DEPOSITS OVER THE CASH WITHDRAWALS, FOR THE MONTHS OF DECEMBER, 2008 AND FEBRUARY, 2009, AMOUNTING TO RS.1.34 LACS AND RS.1.94 LACS RESPECTIVELY, I.E., R S.3.28 LACS IN TOTAL, BESIDES ANOTHER CASH DEPOSIT FOR RS.49,900/- ON 15.04.2008, I.E., AT AN AGGREGATE OF RS.3,77,900/-, WAS CONSIDERED AS THE ASSESSEES INCOME BY WAY OF UNEXP LAINED CASH DEPOSIT IN HIS BANK ACCOUNT. IN APPEAL, THE ASSESSEE SUBMITTED DATE-WISE DETAIL S OF THE CASH DEPOSITED AND WITHDRAWAL, WHICH IT WAS CLAIMED WERE NOT CALLED FO R BY THE ASSESSING OFFICER (A.O.) DURING ASSESSMENT PROCEEDINGS. THE WITHDRAWALS FOR THE YEAR, AT RS.36.61 LACS, WERE IN FACT HIGHER THAN THE CASH DEPOSITS THEREAT, BEING A T RS.14.89 LACS AND, BESIDES, INCLUDED CASH WITHDRAWALS FOR PERSONAL EXPENSES, ETC. AMOUNT ING TO RS.9.12 LACS. THE LD. CIT(A) OBSERVED THAT THE ACTIVITY OF CASH DEPOSIT AND WITH DRAWAL HAD BEEN CARRIED THROUGHOUT THE YEAR AND, FURTHER, WITHOUT ANY JUSTIFIABLE REASON. THERE WAS NO REASON FOR FURTHER CASH WITHDRAWALS WHEN THE CASH TO THE EXTENT REQUIRED IS ALREADY AVAILABLE AT HAND. THE EXPLANATION OF THE CASH DEPOSITS BEING FINANCED BY THE CASH WITHDRAWALS WAS, THUS, CONSIDERED UNACCEPTABLE, RELYING ON THE TEST OF HUM AN PROBABILITIES, WITH REFERENCE TO THE DECISION BY THE APEX COURT IN THE CASE OF SUMATI DAYAL VS. CIT [1995] 214 ITR 801 (SC). THE WITHDRAWALS WOULD ONLY BE FOR SOME IMMEDIATE EX PENSE OR OBLIGATION, PARTICULARLY CONSIDERING THE HUGE GAP BETWEEN THE AGGREGATE CASH DEPOSIT AND WITHDRAWAL AMOUNT FOR THE YEAR. THE ADDITION BEING THUS CONFIRMED, THE AS SESSEE IS IN SECOND APPEAL. 3. WE HAVE HEARD THE PARTIES, AND PERUSED THE MATER IAL ON RECORD. 3 ITA NO. 2755/MUM/2012 (A.Y. 2009-10) SURESH KUMAR S. SHARMA VS. ASST. CIT 3.1 WE ARE IN PRINCIPLE IN COMPLETE AGREEMENT WITH THE REVENUE THAT THE WITHDRAWALS, PARTICULARLY IN SMALL SUMS, WOULD ONLY BE TOWARD ME ETING SOME IMMEDIATE OR PERSONAL EXPENSE OR OBLIGATION. FURTHER, THE ACTIVITY OF CAS H DEPOSIT AND WITHDRAWAL, WHICH STANDS CARRIED OUT THROUGHOUT THE YEAR, WOULD ONLY BE TO S OME PURPOSE AND EFFECT - WHILE NONE STANDS EXPLAINED BY THE ASSESSEE, AND CANNOT BE CON SIDERED AS AN INANE AND PURPOSELESS ACTIVITY OF MERELY RECYCLING THE FUNDS FOR THE SAKE OF IT. AFTER ALL, CASH WOULD NOT BE WITHDRAWN FROM BANK ONLY TO SWELL THE CASH BALANCE IN HAND . THAT, HOWEVER, MAKES FOR A VALID AND A REASONABLE GROUND FOR INVESTIGATING THE MATTER FURTHER, AND NOT FOR JUMPING TO ANY CONCLUSION. MERELY REJECTING THE ASSESSEES EXP LANATION TOWARD THE SOURCE OF THE CASH, AVAILABLE IN ITS BOOKS, SINCE ADDUCED, WOULD BE OF NO MOMENT. THE PERSONAL EXPENSES, STATED AT RS.9.12 LACS, CAN ONLY BE CONSI DERED AS REASONABLE, PARTICULARLY IN THE ABSENCE OF ANY ADVERSE MATERIAL OR INFORMATION. THE SAME, AS IT APPEARS, WOULD ALSO EXCLUDE RECYCLING OF FUNDS WITHDRAWN FROM THE BANK IN MINOR SUMS. THE PROPOSITION OF SUMATI DAYAL (SUPRA) SHALL NOT APPLY IN THE FACTS AS FOUND IN-AS -MUCH AS THE REVENUE HAS NOT SHOWN AS TO HOW THE ASSESSEE HAS GAINED OR BENE FITTED IN ANY MANNER. IT IS ONLY WHERE SO THAT THE EXPLANATION HAS TO SATISFY THE TEST OF HUMAN PROBABILITIES, BEING ONLY A MANIFESTATION AND REFLECTION OF THE TEST OF REASONA BLENESS, WHICH IS TO INFORM ANY ASSESSMENT UNDER THE ACT. THE REVENUES CASE, IN AN Y CASE OF THE MATTER, IS LIMITED TO UNEXPLAINED DEPOSITS IN THE MONTH OF DECEMBER, 2008 AND FEBRUARY, 2009 ONLY. THE SOURCE THEREOF BEING EXPLAINED IN TERMS OF THE CASH AVAILABLE IN BOOKS, IT NEEDS TO BE APPRECIATED, COULD IN FACT ONLY BE ON THE BASIS OF THE SOURCE OF THE SAID CASH AS REFLECTED IN BOOKS, UNLESS OF COURSE THE CASH AVAILABILITY IN A PARTICULAR SUM AS ON A PARTICULAR DATE STANDS ALREADY CONFIRMED OR FOUND AS A FACT. 3.2 IN VIEW OF THE FOREGOING, WE, UNDER THE CIRCUMS TANCES, ONLY CONSIDER IT FIT AND PROPER THAT THE MATTER IS RESTORED BACK TO THE FILE OF THE ASSESSING AUTHORITY TO ENABLE THE ASSESSEE TO EXPLAIN THE CASH DEPOSITS FOR THE TWO M ONTHS AFORE-REFERRED WITH REFERENCE TO THE AVAILABILITY OF CASH WITH IT PRIOR TO THE DATE/ S OF DEPOSIT/S FROM CONFIRMED SOURCES, I.E., 4 ITA NO. 2755/MUM/2012 (A.Y. 2009-10) SURESH KUMAR S. SHARMA VS. ASST. CIT PROVE THE SOURCE THEREOF ON THE PARAMETERS OF THE R ELEVANT PROVISION/S. WE DECIDE ACCORDINGLY. 4. IN THE RESULT, THE ASSESSEES APPEAL IS ALLOWED FOR STATISTICAL PURPOSES. 0/ 1 )2 30 ' 4' 567 8 * 9 ' :; ORDER PRONOUNCED IN THE OPEN COURT ON MAY 21, 2014 SD/- SD/- (AMIT SHUKLA) (SANJAY ARORA) / JUDICIAL MEMBER / ACCOUNTANT MEMBER <+ MUMBAI; =) DATED : 21.05.2014 *.)../ ROSHANI , SR. PS ! ' #$%& ' &$ / COPY OF THE ORDER FORWARDED TO : 1. '$ / THE APPELLANT 2. %&'$ / THE RESPONDENT 3. ( ) / THE CIT(A) 4. / CIT - CONCERNED 5. @*A B %)C2 , , C2/ , <+ / DR, ITAT, MUMBAI 6. B D3 E + / GUARD FILE ! ( / BY ORDER, )/(* + (DY./ASSTT. REGISTRAR) , <+ / ITAT, MUMBAI