ACIT, Kannur V. Dr.Premdeep Priyadarshan, Kannur

ITA 281/COCH/2012

• Counselvise Citation: [2013] 120 COUNSELVISE.COM (IT) 2560 (ITAT-COCHIN)
• Duration Of Justice: 7 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-06-2013
• Appeal Filed By: Department
• Bench Allotted: DB
• Assessment Year: 2006-2007
• Appeal Filed On: 05-11-2012
• Court: TRIBUNAL
• Department Lawyers: S VIJAYAPRABHA
• Assessee Lawyers: R ANANTH A KRISHNAN
• Keywords: Onus to prove; Retraction
• Section: 131; 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL COCHIN BENCH, COCHIN BEFORE S/SHRI N.R.S.GANESAN, JM AND B.R.BASKAR AN, AM I.T.A. NOS. 281 & 314/COCH/2012 ASSESSMENT YEARS : 2006-07 & 2008 THE ASSISTANT COMMISSIONER OF INCOME-TAX, CIRCLE-1, KANNUR. VS. DR. PREMDEEP PRIYADARSHAN, ENT CLINIC, JUBILEE BAZAR, ONDEN ROAD, KANNUR. [PAN:AFQPP 3954H] (REVENUE-APPELLANT) (ASSESSEE-R ESPONDENT) CO. NOS. 19 & 21/COCH/2012 (ARSG. OUT OF I.T.A. NOS. 281 & 314/COCH/2012 ASSESSMENT YEARS : 2006-07 & 2008 DR. PREMDEEP PRIYADARSHAN, ENT CLINIC, JUBILEE BAZAR, ONDEN ROAD, KANNUR. [PAN:AFQPP 3954H] VS. THE ASSISTANT COMMISSIONER OF INCOME-TAX, CIRCLE-1, KANNUR. (ASSESSEE-APPELLANT) (REVENUE-R ESPONDENT) REVENUE BY SMT. S. VIJAYAPRABHA, JR. DR ASSESSEE BY SHRI R. ANANTHAKRISHNAN, CA DATE OF HEARING 21/03/2013 DATE OF PRONOUNCEMENT 07/06/2013 O R D E R PER B.R.BASKARAN, ACCOUNTANT MEMBER: THE APPEALS FILED BY THE REVENUE AND THE CROSS OBJ ECTIONS FILED BY THE ASSESSEE ARE DIRECTED AGAINST THE SEPARATE ORDERS PASSED BY LD CIT(A)-II, KOZHIKODE AND THEY RELATE TO THE ASSESSMENT YEARS 2006-07 AND 2007-08. ALL THE APPEALS WERE HEARD TOGETHER AND HENCE THEY ARE BEING DISPOSED OF BY TH IS COMMON ORDER, FOR THE SAKE OF CONVENIENCE. 2. THE FACTS RELATING TO THE CASE ARE STATED IN BRI EF. THE ASSESSEE HEREIN IS AN ENT SURGEON. THE DEPARTMENT CARRIED SURVEY OPERATION I N THE BUSINESS PREMISES OF THE ASSESSEE ON 21.03.2007. DURING THE COURSE OF SURVE Y OPERATIONS, THE SURVEY OFFICIALS I.T.A. NOS. 281 & 314/COCH/2012 & C.O. NOS. 19 & 21/COCH/2012 2 RECORDED STATEMENTS ON OATH FROM THE ASSESSEE AND A LSO FROM ONE OF THE STAFF MEMBERS. IN THE SWORN STATEMENTS, THE ASSESSEE CON CEDED THAT HE DID NOT MAINTAIN PROPER BOOKS OF ACCOUNT. THE STAFF MEMBER CONCEDED THAT THE PROFESSIONAL FEE RECEIPTS ARE ACCOUNTED TO THE EXTENT OF 60 TO 70% ONLY. SUB SEQUENTLY, THE ASSESSEE FILED RETURNS OF INCOME FOR BOTH THE YEARS UNDER CONSIDER ATION. SINCE THE ASSESSEE DID NOT MAINTAIN BOOKS OF ACCOUNT, HE FILED CASH FLOW STATE MENTS TO EXPLAIN THE INVESTMENTS AND OTHER TYPES OF CASH OUTFLOW. THE AO COMPLETED THE ASSESSMENTS FOR BOTH THE YEARS BY MAKING VARIOUS ADDITIONS. THE ASSESSEE CHALLENG ED THE ASSESSMENT ORDERS PASSED FOR BOTH THE YEARS BY FILING APPEAL BEFORE LD CIT(A ) AND SUCCEEDED. AGGRIEVED, BY THE ORDERS PASSED BY LD CIT(A), THE REVENUE HAS FILED T HESE TWO APPEALS BEFORE US. THE ASSESSEE HAS FILED CROSS OBJECTIONS SUPPORTING THE ORDERS PASSED BY LD CIT(A). 3. WE SHALL FIRST TAKE UP THE APPEAL FILED FOR THE ASSESSMENT YEAR 2006-07, WHEREIN FOLLOWING ISSUES ARE AGITATED. (A) ADDITION TO PROFESSIONAL INCOME RS.2.00 LAK HS (B) ADDITION OF CASH CREDIT FROM SMT. MINI, SPOUS E OF ASSESSEE RS.4.00 LAKHS (C) ADDITION OF CASH CREDIT FROM M/S PRIYA HEALTH CARE RS.10.00 LAKHS (D) ADDITION OF CASH CREDIT RELATING TO SALE OF F URNITURES RS.1,53,165/- (E) DISALLOWANCE MADE U/S 80C(5)(III) RS.1,07,0 42/- AT THE TIME OF HEARING, THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT HE IS CONCEDING THE GROUND RELATING TO THE DISALLOWANCE M ADE U/S 80C(5)(III) OF THE ACT, I.E., ITEM (E) LISTED ABOVE. ACCORDINGLY, THE DECISION R ENDERED BY LD CIT(A) ON THAT ISSUE IS SET ASIDE AND THE ORDER OF THE ASSESSING OFFICER ON THAT ISSUE IS RESTORED. 4. THE FIRST ISSUE RELATES TO THE ADDITION OF R S.2.00 LAKHS MADE TO THE PROFESSIONAL INCOME. DURING THE COURSE OF SURVEY PROCEEDINGS, I T WAS NOTICED THAT THE ASSESSEE DID NOT MAINTAIN PROPER BOOKS OF ACCOUNT. IN THE STATE MENTS TAKEN FROM THE ASSESSEE, HE ACCEPTED THAT HE DID NOT MAINTAIN PROPER BOOKS OF A CCOUNTS. IN THE STATEMENT TAKEN FROM ONE OF THE STAFFS NAMED SMT. LASEENA, SHE CONC EDED THAT PART OF COLLECTIONS IS NOT ACCOUNTED. THE AO NOTICED THAT THE ASSESSEE HAD DE CLARED GROSS PROFESSIONAL RECEIPTS I.T.A. NOS. 281 & 314/COCH/2012 & C.O. NOS. 19 & 21/COCH/2012 3 OF RS.12,54,450/- IN THE RETURN OF INCOME. THE AO FURTHER NOTICED THAT THE ASSESSEE WAS CARRYING ON FOLLOWING TYPES OF ACTIVITIES. (A) SPECIALIST CONSULTATION AS AN ENT SURGEON (B) CONDUCTING TEST FOR AUDIOLOGY, LARYGNOGRAPHY, SLEEP APNEA AND ENDOSCOPY (C) ENT SURGICAL PROCEDURE (D) PHARMAY (E) MEDICAL LABORATORY (F) COLLECTION AND REFERENCE CENTRE OF THRO LAB , BOMBAY. BEFORE THE AO, THE ASSESSEE COULD NOT GIVE BREAK UP DETAILS OF GROSS PROFESSIONAL RECEIPTS. HOWEVER, FROM THE MATERIALS GATHERED DUR ING THE COURSE OF SURVEY, IT WAS NOTICED THAT THE RECEIPTS FROM SURGICAL PROCEDURES ALONE WAS TO THE TUNE OF RS.9,55,870/-. HENCE, ON A CONSPECTUS OF THE MATTE R, THE AO TOOK THE VIEW THAT THERE WAS SUPPRESSION IN ACCOUNTING THE PROFESSIONAL RECE IPTS AND ACCORDINGLY ESTIMATED THE AMOUNT OF SUPPRESSION AT RS.2.00 LAKHS AND ADDED TH E SAME TO THE TOTAL INCOME OF THE ASSESSEE. 5. BEFORE LD CIT(A), THE ASSESSEE CONTENDED THA T STATEMENT TAKEN FROM THE STAFF OF THE ASSESSEE WAS NOT PUT TO HIM AND HENCE THE AO CO ULD NOT HAVE PLACED RELIANCE ON IT. IN THIS REGARD, THE ASSESSEE DREW SUPPORT FROM THE DECISION OF HONBLE SUPREME COURT IN THE CASE OF KISHIN CHAND CHELLARAM VS. CIT (125 ITR 713)(SC). FURTHER IT WAS CONTENDED THAT THE STATEMENT TAKEN DURING THE COURS E OF SURVEY PROCEEDINGS DOES NOT HAVE EVIDENTIARY VALUE AND IN THIS REGARD, RELIANCE WAS PLACED ON THE DECISION OF JURISDICTIONAL HIGH COURT IN THE CASE OF PAUL MATHE W & SONS VS. CIT (2003) (263 ITR 101). THE LD CIT(A), BY PLACING RELIANCE ON THE DE CISION OF THE JURISDICTIONAL HIGH COURT IN THE CASE OF PAUL MATHEW & SONS (REFERRED SUPRA) DELETED THIS ADDITION. 6. THE LD. DR SUBMITTED THAT THE STATEMENT WAS TAKE N FROM THE ASSESSEE AS WELL AS FROM SMT. LASEENA, A STAFF MEMBER OF THE ASSESSEE U /S. 131 OF THE ACT BY ADMINISTERING OATH AND HENCE, THE SAID STATEMENTS DO HAVE EVIDENT IARY VALUE. IN THIS REGARD, THE LD. DR PLACED RELIANCE ON THE DECISION RENDERED BY THIS BENCH OF THE TRIBUNAL IN THE CASE OF ACIT VS. M/S. REAL FORT AND RESORTS PVT. LTD. IN IT (SS)A NO. 217/COCH/2005. THE LD. DR FURTHER SUBMITTED THAT THE ASSESSEE DID NOT MAIN TAIN PROPER BOOKS OF ACCOUNTS AND I.T.A. NOS. 281 & 314/COCH/2012 & C.O. NOS. 19 & 21/COCH/2012 4 HENCE THE AO WAS CONSTRAINED TO MAKE AN ADDITION OF RS.2.00 LAKHS AS SUPPRESSION OF PROFESSIONAL INCOME. 7. ON THE CONTRARY, THE LD A.R SUBMITTED THAT T HE STATEMENT TAKEN FROM SMT. K. LASEENA, ONE OF THE STAFF MEMBERS OF THE ASSESSEE W AS NOT PUT TO THE ASSESSEE AND HENCE, THE ASSESSING OFFICER SHOULD NOT HAVE PLACED RELIANCE ON THIS. HE FURTHER SUBMITTED THAT SMT. K. LASEENA HAS FILED AN AFFIDAV IT SUBSEQUENTLY, WHEREIN SHE HAS RETRACTED FROM THE STATEMENT GIVEN BY HER DURING TH E COURSE OF SURVEY OPERATIONS. THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE STA TEMENTS TAKEN DURING THE COURSE OF SURVEY DO NOT HAVE ANY EVIDENTIARY VALUE IN VIEW OF THE HONBLE JURISDICTIONAL HIGH COURT OF KERALA IN THE CASE OF PAUL MATHEW & SONS, REFERRED SUPRA. 8. WE HAVE HEARD THE RIVAL CONTENTIONS ON THIS ISSU E AND PERUSED THE RECORD. ADMITTEDLY, THE ASSESSEE DID NOT MAINTAIN PROPER BO OKS OF ACCOUNTS. THOUGH THE ASSESSEE IS CARRYING ON VARIOUS TYPES OF ACTIVITIES AS MENTIONED IN THE PREVIOUS PARAGRAPHS, YET HE COULD NOT FURNISH THE BREAKUP DE TAILS FOR GROSS PROFESSIONAL RECEIPTS OF RS.12,54,450/-. THERE CANNOT BE ANY DISPUTE THA T THE CORRECT QUANTUM OF PROFESSIONAL RECEIPTS CANNOT BE ASCERTAINED WITHOUT THE HELP OF PROPER BOOKS OF ACCOUNTS AND SUPPORTING VOUCHERS. 9. WE NOTICE THAT THE LD. CIT(A) HAS DELETED THE IM PUGNED ADDITION OF RS.2.00 LAKHS MAINLY ON THE GROUND THAT THE STATEMENT TAKEN DURING THE COURSE OF SURVEY DOES NOT HAVE EVIDENTIARY VALUE. HOWEVER, FROM THE FACT S AVAILABLE ON RECORD, WE NOTICE THAT THE STATEMENT TAKEN FROM THE ASSESSEE AS WELL AS FR OM SMT. K. LASEENA, STAFF MEMBER OF THE ASSESSEE, HAS FURTHER BEEN CORROBORATED BY T HE ASSESSING OFFICER BY BRINGING THE FACT ON RECORD THAT THE ASSESSEE DID NOT MAINTAIN P ROPER BOOKS OF ACCOUNTS. FURTHER, THE ASSESSING OFFICER HAS POINTED OUT THAT THE ASSE SSEE COULD NOT BIFURCATE THE PROFESSIONAL RECEIPTS OF RS.12.54 LAKHS UNDER VARIO US HEADS OF ACTIVITIES. THE ASSESSEE ALSO COULD FILE ONLY THE CASH FLOW STATEMENTS TO SU BSTANTIATE HIS INVESTMENTS AND OTHER CASH OUTFLOW. THESE FACTS CLEARLY SHOW THAT ALL I S NOT WELL WITH THE ASSESSEE. THESE FACTS, IN FACT, CLEARLY SUPPORT THE CASE OF THE ASS ESSING OFFICER, MEANING THEREBY, THE I.T.A. NOS. 281 & 314/COCH/2012 & C.O. NOS. 19 & 21/COCH/2012 5 ADDITION OF RS.2.00 LAKHS COULD STILL BE MADE BY TH E AO WITHOUT DRAWING ANY SUPPORT FROM THE STATEMENTS TAKEN DURING THE COURSE OF SURV EY. HENCE, IN OUR VIEW, IT CANNOT BE SAID THAT THE ASSESSING OFFICER HAS MADE THE IMP UGNED ADDITION OF RS.2.00 LAKHS BY PLACING RELIANCE SOLELY ON THE STATEMENTS TAKEN FRO M THE ASSESSEE AS WELL AS FROM SMT. K. LASEENA, THE STAFF MEMBER OF THE ASSESSEE. HENC E, IN OUR VIEW, THE LD CIT(A) HAS MISDIRECTED HIMSELF IN ASSUMING THAT THE IMPUGNED A DDITION WAS MADE ON THE BASIS OF STATEMENTS ALONE. THE LD A.R, BY PLACING RELIANCE ON THE AFFIDAVIT GIVEN BY SMT. K. LASEENA, THE STAFF MEMBER OF THE ASSESSEE, SUBMITTE D THAT THE SAID EMPLOYEE HAS RETRACTED FROM HER STATEMENT GIVEN EARLIER. WE NOT ICE THAT THE STATEMENT WAS TAKEN FROM SMT. K. LASEENA ON 21.3.2007 AND SHE HAS RETRA CTED THE SAME ON 16.11.2009, I.E., AFTER ABOUT TWO AND HALF YEARS. IT IS WELL SETTLED PROPOSITION OF LAW THAT THE RETRACTION SHOULD BE MADE AT THE EARLIEST POSSIBLE OPPORTUNITY . IN VIEW OF THE HUGE TIME GAP, THE AFFIDAVIGT FILED BY SMT. K. LASEENA IS LIABLE TO BE REJECTED. EVEN OTHERWISE, WE HAVE NOTICED THAT THE IMPUGNED ADDITION OF RS.2.00 LAKHS COULD BE MADE BY DISREGARDING THE STATEMENTS TAKEN DURING THE COURSE OF SURVEY. IN V IEW OF THE FOREGOING, IN OUR VIEW, THE ASSESSING OFFICER WAS JUSTIFIED IN MAKING THE A DDITION OF RS.2.00 LAKHS TOWARDS SUPPRESSION OF PROFESSIONAL RECEIPTS. ACCORDINGLY, WE SET ASIDE THE ORDER OF THE LD. CIT(A) ON THIS ISSUE AND RESTORE THE ADDITION MADE BY THE AO. 10. THE NEXT ISSUE RELATES TO THE ADDITION OF CA SH CREDIT RECEIVED FROM SMT. MINI, SPOUSE OF THE ASSESSEE. IN THE CASH FLOW STATEMENT FILED FOR THE FINANCIAL YEAR 2005-06, THE ASSESSEE DISCLOSED A RECEIPT OF RS. 14 LAKHS FR OM HIS SPOUSE, NAMED SMT. MINI. BEFORE THE ASSESSING OFFICER, IT WAS CLAIMED THAT T HE ABOVE SAID AMOUNT OF RS. 14 LAKHS WAS RECEIVED BY SMT. MINI FROM HER FATHER-IN-LAW. IT WAS FURTHER SUBMITTED THAT A SUM OF RS.10.00 LAKHS OUT OF THE SAID AMOUNT OF RS. 14 LAKHS WAS USED FOR PURCHASING A DEMAND DRAFT IN CONNECTION WITH THE ADMISSION OF HE R SON INTO A MEDICAL COLLEGE. THE ASSESSING OFFICER NOTICED THAT SMT. MINI WITHDREW T HE REMAINING AMOUNT OF RS.4.00 LAKHS IMMEDIATELY AFTER THE PURCHASE OF DEMAND DRAF T OF RS. 10 LAKHS. HENCE THE ASSESSING OFFICER TOOK THE VIEW THAT THE WITHDRAWAL OF RS.4.00 LAKHS COULD ALSO HAVE BEEN USED IN CONNECTION WITH THE MEDICAL COLLEGE AD MISSION OF HER SON AND HENCE, THE SAID AMOUNT COULD NOT HAVE BEEN GIVEN TO THE ASSESS EE. ACCORDINGLY, HE ADDED THE I.T.A. NOS. 281 & 314/COCH/2012 & C.O. NOS. 19 & 21/COCH/2012 6 AMOUNT OF RS.4.00 LAKHS AS INCOME OF THE ASSESSEE. THE LD. CIT(A), HOWEVER, DELETED THE ADDITION WITH THE OBSERVATION THAT THERE IS NO REASON WHY THE ASSESSING OFFICER SHOULD NOT ACCEPT THE REMAINING AMOUNT OF CASH CRED IT OF RS. 4 LAKHS, WHEN HE IS ACCEPTING THE AMOUNT OF RS.10.00 LAKHS. 11. WE HAVE HEARD THE RIVAL CONTENTIONS ON THIS ISSUE. WE NOTICE THAT THE ASSESSING OFFICER HAS ADDED THE AMOUNT OF RS.4.00 LAKHS WITHO UT EXAMINING EITHER THE ASSESSEE OR THE SPOUSE OF THE ASSESSEE. WE ALSO NOTICE THAT TH E LD. CIT(A) HAS ALSO DELETED THE ADDITION WITHOUT CARRYING OUT ANY SUCH EXAMINATION. THUS, BOTH THE TAX AUTHORITIES, IN OR VIEW, HAS PROCEEDED TO DEAL WITH THIS ISSUE ON S URMISES BY MAKING CERTAIN PRESUMPTIONS, I.E., BOTH THE AUTHORITIES HAVE FAILE D TO EXAMINE THE ABOVE SAID CASH CREDIT AS MANDATED BY THE PROVISIONS OF SEC. 68 OF THE ACT. ACCORDINGLY, IN OUR VIEW, THIS ISSUE REQUIRES FRESH EXAMINATION AT THE END OF THE ASSESSING OFFICER. ACCORDINGLY, WE SET ASIDE THE ORDER OF THE LD. CIT(A) ON THIS IS SUE AND RESTORE THE SAME BACK TO THE FILE OF THE ASSESSING OFFICER WITH A DIRECTION TO E XAMINE THE ISSUE AFRESH AND TAKE APPROPRIATE DECISION IN ACCORDANCE WITH LAW. 12. THE NEXT ISSUE RELATES TO THE ADDITION OF CASH CREDIT OF RS.10.00 LAKHS CLAIMED TO HAVE BEEN RECEIVED FROM A CONCERN NAMED M/S. PRIYA HEALTH CARE. FROM THE ORDERS OF BOTH THE TAX AUTHORITIES, WE NOTICE THAT THE ASSESS ING OFFICER DID NOT ACCEPT THE GENUINENESS OF CREDIT WITHOUT CARRYING OUT ANY VERI FICATION. THE LD. CIT(A) HAS ALSO DELETED THE ADDITION WITHOUT MAKING ANY EXAMINATION OF THE CLAIM OF THE ASSESSEE. BEFORE THE ASSESSING OFFICER, IT APPEARS THAT THE A SSESSEE HAD OFFERED SOME EXPLANATIONS WITH REGARD TO THE SOURCES IN THE HAND S OF THE CONCERN, CITED ABOVE, FOR MAKING THE IMPUGNED ADVANCE TO THE ASSESSEE. HOWEV ER, THE SAID EXPLANATION HAS BEEN REJECTED BY THE AO WITHOUT EXAMINING THE SAME AND THE LD CIT(A) HAS ALSO ACCEPTED THE SAID EXPLANATIONS WITHOUT CAUSING NECE SSARY ENQUIRIES THEREOF. THUS, BOTH THE TAX AUTHORITIES HAVE NOT EXAMINED THIS ISS UE IN A PROPER PERSPECTIVE. HENCE, IN OUR VIEW, THIS ISSUE ALSO REQUIRES FRESH EXAMINA TION AT THE END OF THE ASSESSING OFFICER. ACCORDINGLY, WE SET ASIDE THE ORDER OF TH E LD. CIT(A) ON THIS ISSUE AND RESTORE I.T.A. NOS. 281 & 314/COCH/2012 & C.O. NOS. 19 & 21/COCH/2012 7 THE SAME BACK TO THE FILE OF THE ASSESSING OFFICER WITH A DIRECTION TO EXAMINE THE ISSUE AFRESH AND TAKE APPROPRIATE DECISION IN ACCORDANCE WITH LAW. 13. THE NEXT ISSUE RELATES TO THE ADDITION OF RS.1, 53,165/- RELATING TO THE SALE OF FURNITURE AND FITTINGS. THE FACTS RELATING TO THE SAME ARE STATED IN BRIEF. IN THE CASH FLOW STATEMENT, THE ASSESSEE HAD DISCLOSED THE AMOU NT RECEIVED FROM SALE OF A FLAT AT RS. 11,18,165/-. THE ASSESSING OFFICER, HOWEVER, N OTICED FROM THE SALE DEED THAT THE ASSESSEE HAD SOLD THE FLAT FOR A CONSIDERATION OF R S. 9,65,000/- ONLY. WHEN ENQUIRED ABOUT THE DIFFERENCE IN THE AMOUNT OF SALE CONSIDER ATION, THE ASSESSEE SUBMITTED THAT HE HAD SOLD THE FURNITURE AND FITTINGS AVAILABLE IN THE FLAT SEPARATELY FOR A SUM OF RS.1,53,165/-. HOWEVER, THE ASSESSEE COULD NOT SUB STANTIATE THE SAID CLAIM WITH ANY DOCUMENTARY EVIDENCE. THE AO ALSO NOTICED THAT THE ASSESSEE DID NOT ACCOUNT FOR ANY EXPENDITURE ON PURCHASE OF FURNITURE AND FITTINGS. ACCORDINGLY, THE ASSESSING OFFICER REJECTED THE CLAIM OF RECEIPT OF RS.1,53,165/- AND ASSESSED THE SAME AS INCOME OF THE ASSESSEE. BEFORE THE LD. CIT(A), THE ASSESSEE CON TENDED THAT THE FURNITURE AND FITTINGS WERE ACQUIRED BY HIM OVER THE YEARS, BY SPENDING A SUM OF RS. 20,000/- PER YEAR. THE LD. CIT(A) ACCEPTED THE SAID CLAIM AND ACCORDINGLY, DIRECTED THE ASSESSING OFFICER TO DELETE THE ABOVE SAID ADDITION. 14. WE NOTICE THAT THE ASSESSEE COULD NOT FURNISH A NY EVIDENCE TO SUBSTANTIATE THE CLAIM OF RECEIPT OF RS.1,53,165/- ON SALE OF FURNIT URE AND FITTINGS. BEFORE THE LD. CIT(A), THOUGH THE ASSESSEE CLAIMED THAT THE FURNITURE AND FITTINGS WERE ACCUMULATED OVER A PERIOD BY SPENDING A SUM OF RS. 20,000/- PER YEAR, YET IT TURNED OUT TO BE A ORAL EXPLANATION, AS THE ASSESSEE COULD NOT FURNISH ANY EVIDENCE IN SUPPORT OF THE SAID CLAIM. THUS, THE CREDIT OF RS.1,53,165/- TURNS OUT TO BE A MERE CASH CREDIT. THERE SHOULD NOT BE ANY DISPUTE THAT UNDER SECTION 68 OF THE ACT, THE INITIAL BURDEN TO PROVE THE CASH CREDIT IS PLACED UPON THE ASSESSEE. IF TH E ASSESSEE DISCHARGES THE INITIAL BURDEN OF PROOF PLACED UPON HIM, THEN THE BURDEN OF PROOF GETS SHIFTED TO THE ASSESSING OFFICER. IN THE INSTANT CASE, ADMITTEDLY , THE ASSESSEE COULD NOT FURNISH ANY EVIDENCE TO SUBSTANTIATE THE CLAIM OF RECEIPT OF RS .1,53,165/-, MEANING THEREBY THAT THE ASSESSEE COULD NOT DISCHARGE THE INITIAL BURDEN PL ACED UPON HIM U/S 68 OF THE ACT. I.T.A. NOS. 281 & 314/COCH/2012 & C.O. NOS. 19 & 21/COCH/2012 8 UNDER THESE SET OF FACTS, IN OUR VIEW, THE ASSESSIN G OFFICER WAS RIGHT IN LAW IN ASSESSING THE AMOUNT OF RS. 1,53,165/- AS THE INCOME OF THE A SSESSEE . ACCORDINGLY, WE SET ASIDE THE ORDER OF THE LD. CIT(A) ON THIS ISSUE AND RESTO RE THAT OF THE ASSESSING OFFICER. 15. WE SHALL NOW TAKE UP THE APPEAL FILED FOR T HE ASSESSMENT YEAR 2007-08, WHEREIN FOLLOWING ISSUES ARE CONTESTED BY THE ASSESSEE:- (A) ADDITION TO PROFESSIONAL INCOME RS.3.50 LAK HS (B) ADDITION OF CONTRIBUTION CLAIMED TO HAVE BEEN RECEIVED FROM THE FATHER AND WIFE OF THE ASSESSEE RS.5.00 LAKHS. 16. THE FIRST ISSUE RELATES TO THE ADDITION OF R S.3.50 LAKHS TO THE PROFESSIONAL INCOME DISCLOSED BY THE ASSESSEE. THIS ADDITION HAS BEEN MADE UNDER IDENTICAL SET OF FACTS AS IN THE CASE OF IMMEDIATELY PRECEDING YEAR, WHEREIN AN ADDITION OF RS.2.00 LAKHS WAS MADE TO THE PROFESSIONAL INCOME. THE LD CIT(A), AS IN THE CASE OF IMMEDIATELY PRECEDING YEAR, DELETED THE ADDITION ON THE GROUND THAT THE AO SHOULD NOT HAVE PLACED RELIANCE ON THE STATEMENT TAKEN DURING THE COURSE O F SURVEY. 17. WHILE CONSIDERING AN IDENTICAL ISSUE IN THE PRECEDING YEAR (SUPRA), WE HAVE GIVEN A FINDING THAT THE ADDITION TO THE PROFESSIONAL INC OME COULD BE MADE BY THE ASSESSING OFFICER, EVEN WITHOUT PLACING RELIANCE ON THE STATE MENTS TAKEN FROM THE ASSESSEE AS WELL AS ONE OF THE STAFF MEMBERS, IN VIEW OF THE DEFECTS IN MAINTENANCE OF BOOKS OF ACCOUNTS. IN THE INSTANT YEAR, THE AO HAS ESTIMATE D THE POSSIBLE SUPPRESSION OF PROFESSIONAL INCOME AT RS.3.50 LAKHS AND ADDED THE SAME TO THE TOTAL INCOME OF THE ASSESSEE. WE ALSO NOTICE THAT THE SURVEY OFFICIALS HAVE FOUND UNEXPLAINED CASH OF RS.3,64,075/- DURING THE COURSE OF SURVEY. HOWEVER , THE AO CHOSE NOT TO MAKE ANY ADDITION IN RESPECT OF THE UNEXPLAINED CASH, IN VIE W OF THE ADDITION OF RS.3.50 LAKHS MADE TOWARDS PROFESSIONAL RECEIPTS. IN EFFECT, THE AO HAS TELESCOPED THE UNEXPLAINED CASH BALANCE AGAINST THE ABOVE SAID ADDITION. THUS , IT IS SEEN THAT EVEN IF SOME RELIEF IS GIVEN AGAINST THE ADDITION OF RS.3.50 LAKHS, IT WOU LD AUTOMATICALLY GET OFFSET BY THE ADDITION RELATING TO UNEXPLAINED CASH FOUND DURING THE COURSE OF SURVEY. FOR THE REASONS STATED BY US WHILE CONFIRMING THE ADDITION OF RS.2.00 LAKHS IN THE IMMEDIATELY I.T.A. NOS. 281 & 314/COCH/2012 & C.O. NOS. 19 & 21/COCH/2012 9 PRECEDING YEAR, WE CONFIRM THE ADDITION OF RS.3.50 LAKHS MADE IN THE INSTANT YEAR ALSO. ACCORDINGLY, WE SET ASIDE THE ORDER OF LD CIT(A) ON THIS ISSUE AND RESTORE THAT OF THE ASSESSING OFFICER. 18. THE NEXT ISSUE RELATES TO THE ADDITION OF R S.5.00 LAKHS RELATING TO THE CONTRIBUTIONS CLAIMED TO HAVE BEEN RECEIVED FROM TH E FATHER OF THE ASSESSEE (RS.3.00 LAKHS) AND WIFE OF THE ASSESSEE (RS.2.00 LAKHS). ON GOING THROUGH THE BANK ACCOUNTS OF BOTH THE PERSONS CITED ABOVE, THE ASSESSING OFFI CER NOTICED THAT THERE WERE DEPOSITS OF IDENTICAL AMOUNTS IN THE IMMEDIATELY PRECEDING D AY. THE AO FURTHER NOTICED THAT BOTH THE PERSONS ARE NOT INCOME TAX ASSESSEES. HEN CE, THE AO ASKED THE ASSESSEE TO PRODUCE BOTH THE PERSONS FOR EXAMINATION. HOWEVER, THEY WERE NOT PRODUCED BEFORE THE AO BY CITING SOME REASONS. HENCE, THE AO ADDED THE AMOUNT OF RS.5.00 LAKHS AS THE INCOME OF THE ASSESSEE. BEFORE THE LD CIT(A), THE ASSESSEE SUBMITTED THAT THE NOTICES REQUESTING PRODUCTION OF THE FATHER AND WIF E OF THE ASSESSEE WERE ISSUED AT THE FAG END OF THE ASSESSMENT PROCEEDINGS AND ACCORDING LY IT WAS SUBMITTED THAT HE COULD NOT PRODUCE BOTH THE PERSONS BEFORE THE ASSESSING O FFICER FOR WANT OF SUFFICIENT TIME. THE LD CIT(A), HOWEVER, DELETED THE ADDITION OF RS. 5.00 LAKHS WITHOUT MAKING ANY FURTHER EXAMINATION AND ALSO WITHOUT CITING ANY REA SON. 19. WE HAVE HEARD THE PARTIES ON THIS ISSUE. A DMITTEDLY, THE ASSESSEE COULD NOT PRODUCE THE CREDITORS BEFORE THE ASSESSING OFFICER. ACCORDING TO THE ASSESSEE, THE ASSESSING OFFICER ISSUED NOTICES IN THAT REGARD ONL Y AT THE FAG END OF THE ASSESSMENT PROCEEDINGS. THE ASSESSING OFFICER HAS DISCUSSED A BOUT THE BANK ACCOUNTS OF BOTH THE CREDITORS, BUT DID NOT DISCUSS ABOUT ANY OTHER DOCU MENTS. HENCE, IT IS KNOWN AS TO WHETHER THE ASSESSEE HAS FILED ANY OTHER DOCUMENTS TO SUBSTANTIATE THE CLAIM OF RECEIPT OF RS.5.00 LAKHS FROM HIS FATHER AND WIFE. THERE S HOULD NOT BE ANY DISPUTE THAT THE INITIAL BURDEN TO PROVE THE CASH CREDITS IS PLACED UPON THE ASSESSEE U/S 68 OF THE ACT. THE ASSESSEE IS REQUIRED TO PROVE THREE MAIN INGRED IENTS IN THIS REGARD, VIZ., THE IDENTITY OF THE CREDITOR, THE CREDIT WORTHINESS OF THE CREDI TOR AND THE GENUINENESS OF THE TRANSACTION. IN THE INSTANT CASE, IT IS NOT KNOWN A S TO WHETHER THE ASSESSEE DID FURNISH ANY OTHER DOCUMENT EXCEPT THE BANK ACCOUNTS OF BOTH THE PARTIES. FURTHER, THE I.T.A. NOS. 281 & 314/COCH/2012 & C.O. NOS. 19 & 21/COCH/2012 10 ASSESSEE DID NOT PRODUCE BOTH THE CREDITORS BEFORE THE ASSESSING OFFICER, THOUGH HE WAS ASKED TO PRODUCE THEM. ACCORDING TO THE ASSESSEE, HE WAS NOT GIVEN ENOUGH TIME TO PRODUCE THEM. THESE DISCUSSIONS SHOW THAT THE IMPU GNED ADDITION OF RS.5.00 LAKHS HAS BEEN MADE WITHOUT CARRYING OUT NECESSARY VERIFI CATION AS MANDATED BY THE PROVISIONS OF SEC. 68 OF THE ACT. WE HAVE ALREADY NOTICED THAT THE LD CIT(A) HAS DELETED THE IMPUGNED ADDITION WITHOUT GIVING ANY RE ASON. UNDER THESE CIRCUMSTANCES, IN OUR VIEW, THIS ISSUE REQUIRES FRESH EXAMINATION AT THE END OF THE ASSESSING OFFICER. ACCORDINGLY, WE SET ASIDE THE ORDER OF LD CIT(A) ON THIS ISSUE AND RESTORE THE SAME TO THE FILE OF THE ASSESSING OFFICER WITH THE DIRECTIO N TO EXAMINE THE ISSUE AFRESH AND TAKE APPROPRIATE DECISION IN ACCORDANCE WITH THE LAW. 20. THE ASSESSEE HAS FILED THE CROSS OBJECTIONS ONLY TO SUPPORT THE ORDERS PASSED BY LD CIT(A). HENCE, WE DISMISS BOTH THE CROSS OBJECT IONS. 21. IN THE RESULT, BOTH THE APPEALS OF THE REVE NUE ARE TREATED AS ALLOWED FOR STATISTICAL PURPOSES AND THE CROSS OBJECTIONS FILED BY THE ASSESSEE ARE DISMISSED. PRONOUNCED ACCORDINGLY ON 07-06-2 013. SD/- SD/- (N.R.S.GANESAN) (B.R.BASKARAN) JUDICIAL MEMBER ACCOUNTANT MEMBER PLACE: KOCHI DATED: 7TH JUNE, 2013 GJ COPY TO: 1. DR. PREMDEEP PRIYADARSHAN, ENT CLINIC, JUBILEE BA ZAR, ONDEN ROAD, KANNUR. 2. THE ASSISTANT COMMISSIONER OF INCOME-TAX, CIRCLE -1, KANNUR. 3. THE COMMISSIONER OF INCOME-TAX(APPEALS)-II, KOZH IKODE.. 4. THE COMMISSIONER OF INCOME-TAX, KOZHIKODE. 5. D.R., I.T.A.T., COCHIN BENCH, COCHIN. 6. GUARD FILE. BY ORDER (ASSISTANT REGISTRAR) I.T.A.T, COCHIN