Smt. Reeta, Haridwar V. ITO, Roorkee

ITA 2940/DEL/2013

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 2892 (ITAT-DELHI)
• Duration Of Justice: 4 year(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-06-2017
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: F
• Next Hearing Date: 17-05-2017
• Assessment Year: 2009-2010
• Appeal Filed On: 13-05-2013
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: F R MEENA
• Assessee Lawyers: S K MONGA
• Keywords: Unexplained investment
• Section: 147

Judgement Text

PAGE 1 OF 8 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH - F NEW DELHI BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER AND SHRI PRASHANT MAHARISHI , ACCOUNTANT MEMBER ITA NO. 2939/DEL/20 13 ASSESSMENT YEAR : 2009-10 LATE SH. PREM SINGH THROUGH L/H RAJESH KUMAR C/O SHRI P.S.DEEPAK, ADVOCATE 47, SAKET ROORKEE HARIDWAR PAN BZLPS2676D VS. ITO WARD-2 ROORKEE (APPELLANT) (RESPONDENT) ITA NO. 2940/DEL/2013 ASSESSMENT YEAR : 2009-10 REETA W/O SATISH KUMAR C/O SHRI P.S. DEEPAK, ADVOCATE, 47, SAKET, ROORKEE, HARIDWAR PAN ALGPR4812G VS. ITO WARD-2 ROORKEE (APPELLANT) (RESPONDENT) PER BHAVNESH SAINI, JUDICIAL MEMBER ORDER THIS ORDER WAS DISPOSED OF BOTH THE APPEALS FILED B Y DIFFERENT ASSESSES ON IDENTICAL ISSUES. ASSESSEE BY : SHRI S.K. MONGA, ADVOCATE DEPARTMENT BY: SHRI F.R. MEENA, SR. DR DATE OF HEARING 17//05/2017 DATE OF PRONOUNCEMENT 06//06/2017 ITA NOS. 2939,2940/DEL/2013 LATE SHRI PREM SINGH VS. ITO AND SMT. REETA VS. ITO PAGE 2 OF 8 2. WE HAVE HEARD LD. REPRESENTATIVES OF BOTH THE PA RTIES AND PERUSED THE MATERIAL ON RECORD. THE APPEALS ARE DEC IDED AS UNDER :- ITA NO. 2939/DEL/2013 ASSESSMENT YEAR 2009-10 3. THIS APPEAL BY ASSESSEE HAS BEEN DIRECTED AGAINS T THE ORDER OF LD. CIT(A) I DEHRADUN DATED 27 TH FEBRUARY, 2013 FOR ASSTT. YEAR 2009- 10. 4. GROUND NO. 1 AND 2 ARE GENERAL AND NEED NOT ADJU DICATION. LD. COUNSEL FOR ASSESSEE DID NOT PRESS GROUND NO. 4 OF THE APPEAL. SAME IS DISMISSED AS NOT PRESSED. 5. ON GROUND NO. 3 ASSESSEE CHALLENGED THE ADDITION OF RS. 80,000/- OUT OF OPENING CAPITAL OF RS. 1,80,000/- CARRY FOR WARD FROM PREVIOUS YEAR I.E. ASSTT. YEAR 2008-09. 6. IT IS NOTED IN THE IMPUGNED ORDER THAT ASSESSEE CLAIMED TO HAVE MADE INITIAL INVESTMENT OF RS. 1,80,000/- OUT OF HI S OPENING BALANCE OF CAPITAL. ACCORDING TO HIM, HE HAD CASH AMOUNT OF RS . 2,40,000/- REPRESENTING HIS OWN CAPITAL ACCUMULATED OVER THE Y EARS AND OUT OF THAT IT INVESTED RS. 1,80,000/- FOR PURPOSES OF BUSINESS . THE AO REJECTED THE EXPLANATION AS THE ASSESSEE DID NOT HAVE ANY DOCUME NTARY EVIDENCE TO SUBSTANTIATE HIS CONTENTION AND TREATED THE SUM AS HIS UNEXPLAINED INVESTMENT. IN APPEAL IT WAS SUBMITTED BY ASSESSEE THAT THE ASSESSEE HAD FURNISHED HIS RETURN OF INCOME FOR ASSTT. YEAR 2008-09 SHOWING CAPITAL BALANCE OF RS. 2,40,000/- AND MENTIONED T HAT OUT OF THE SAME ITA NOS. 2939,2940/DEL/2013 LATE SHRI PREM SINGH VS. ITO AND SMT. REETA VS. ITO PAGE 3 OF 8 AN AMOUNT OF RS. 1,80,000/- HAD BEEN INVESTED IN AS STT. YEAR 2009-10 FOR WINE SHOP. A COPY WAS ALSO FILED IN SUPPORT OF THE CONTENTION. LD. CIT(A) NOTED THAT ASSESSEE WAS NOT ASSESSED TO TAX REGULARLY. THE RETURN OF INCOME FOR ASSTT. YEAR 2008-09 WAS FURNISHED ON 16 TH SEPTEMBER, 2009 I.E ALMOST SIMULTANEOUSLY WITH THE RETURN FOR ASSTT. YEAR 2009-10. IN THE FORMER, HE SHOWED INCOME OF RS. 95,000/- FRO M BROKERAGE AND AGRICULTURAL INCOME OF RS. 1,05,000/-. HE ALSO CLAI MED OPENING BALANCE OF CASH OF RS. 1,00,000/- AS ON 1.4.2007. ACCORDIN G TO HIM IF THE AO WAS NOT SATISFIED WITH THE EXPLANATION, HE SHOULD H AVE INITIATED ACTION U/S 147 OF THE ACT FOR ASSTT. YEAR 2008-09 AND IF HE DID NOT DO SO IT WAS NOT PROPER FOR HIM TO QUESTION THE OPENING BALANCE AS ON 1.4.2009. LD. CIT (A) THEREFORE NOTED THAT IT IS APPARENT THAT RE TURN FOR ASSTT., YEAR 2008-09 HAD BEEN FURNISHED JUST TO BUILD CAPITAL AS IT SHOWED OPENING BALANCE OF RS. 1,00,000/- INCOME OF RS. 2,00,000/- INCLUDING AGRICULTURAL INCOME. NO TAX WAS PAID BECAUSE RETURN WAS SHOWN TO BE BELOW TAXABLE LIMIT. THE AO REJECTED THE CLAIM. THE COMPUTATION O F INCOME FOR THAT YEAR WOULD ALSO BE BELOW TAXABLE. THE OPENING CASH BALANCE CANNOT BE ACCEPTED SIMPLY BECAUSE ASSESSEE HAS FURNISHED RETU RN SHOWING EQUIVALENT OF CLOSING BALANCE OF CASH IN HAND . LD. CIT(A) ALSO NOTED THAT SAME IS THE POLICY IN OTHER CASES OF LIQUOR CONTRA CTORS. LD. CIT(A) AFTER CONSIDERING SOME SAVINGS OF THE ASSESSEE IN PAST HA D GIVEN CREDIT OF RS. 1,00,000/- AND BALANCE ADDITION OF RS. 80,000/- WAS CONFIRMED. ITA NOS. 2939,2940/DEL/2013 LATE SHRI PREM SINGH VS. ITO AND SMT. REETA VS. ITO PAGE 4 OF 8 7. AFTER CONSIDERING RIVAL SUBMISSIONS WE DO NOT FI ND MERIT IN THIS GROUND OF APPEAL OF ASSESSEE. THE ASSESSEE FILED RE TURN OF INCOME FOR ASSTT. YEAR UNDER APPEAL I.E 2009-10 ON 11 TH SEPTEMBER, 2009. HOWEVER THE LD. CIT(A) NOTED THAT THE RETURN FOR PRECEDING ASSESSMENT YEAR 2008-09 WAS FURNISHED ON 16 TH SEPTEMBER , 2009 I.E AFTER FILING OF THE RETURN FOR ASSESSMENT YEAR UNDER APPEAL. IT IS ALSO ADMITTED FACTS THAT ASSESSEE WAS NOT REGULARLY ASSESSED TO TAX. THEREFO RE, THERE WAS NO EVIDENCE AVAILABLE WITH THE ASSESSEE OF HAVING ANY OPENING BALANCE WITH HIM IN PRECEDING ASSESSMENT YEAR 2008-09 AS WELL AS THERE WERE NO EVIDENCE AVAILABLE TO HAVE ACCUMULATED AMOUNT OF R S. 2,40,000/- IN EARLIER YEARS. THE ASSESSEE IN THE EARLIER YEAR 200 8-09 HAS SHOWN WITHDRAWALS OF RS. 60,000/-. LD. COUNSEL FOR ASSESS EE ADMITTED THAT IN THAT YEAR ASSESSEE WAS HAVING HIS WIFE AND TWO SONS . THEREFORE ASSESSEE DELIBERATELY SHOWN PETTY WITHDRAWALS. THER EFORE, WHEN THE MATTER WAS TAKEN UP FOR ASSESSMENT IN ASSESSMENT YE AR UNDER APPEAL I.E 2009-10 IT WAS THE DUTY OF THE ASSESSEE TO EXPLAIN THE AVAILABILITIES OF THE OPENING CAPITAL BALANCE TO THE SATISFACTION OF THE AO. IF NO EVIDENCE OR MATERIAL WAS PRODUCED BEFORE THE AUTHORITIES BEL OW TO SHOW HOW ASSESSEE WAS HAVING AVAILABILITY OF ANY FUND WITH H IM OR TO HAVE ANY OPENING CAPITAL BALANCE ADDITION IS JUSTIFIED. IN T HE ABSENCE OF ANY EVIDENCE, IT IS DIFFICULT TO ACCEPT THE EXPLANATION OF THE ASSESSEE. IT IS A CLEAR CASE OF BUILDING CAPITAL AND TO SHOW OPENING CAPITAL BALANCE. LD. COUNSEL FOR ASSESSEE SUBMITTED THAT ITAT DELHI BENC H IN THE CASE OF ITA NOS. 2939,2940/DEL/2013 LATE SHRI PREM SINGH VS. ITO AND SMT. REETA VS. ITO PAGE 5 OF 8 VINOD KUMAR ACCEPTED THE OPENING CAPITAL BALANCE OF EARLIER YEAR. HOWEVER, THE FACTS NOW CONSIDERED BY THE LD. CIT(A ) HAVE NOT BEEN CONSIDERED IN THE CASE OF VINOD KUMAR (SUPRA). WE M AY ALSO NOTE THAT SUPPOSE ANY ASSESSEE MAY DECLARE ANY HUGE AMOUNT IN CASH FLOW STATEMENT IN PRECEDING YEAR WHICH WAS NOT SUBJECT T O SCRUTINY ASSESSMENT WHETHER SAME COULD BE EXTENDED BENEFIT T O THE ASSESSEE, THE ANSWER WOULD BE THAT SUCH ATTEMPT TO BUILD CAPI TAL CANNOT BE ACCEPTED UNLESS THERE WAS SOME EVIDENCE OF RECORD T O JUSTIFY ACCUMULATIVE OF FUNDS OR THE AVAILABILITY OF THE OP ENING CAPITAL BALANCE. THIS GROUND OF APPEAL OF ASSESSEE THUS HAS NO MERIT THE SAME IS ACCORDINGLY DISMISSED. 8. ON GROUND NO. 5 ASSESSEE CHALLENGED THE ADDITION OF RS. 4,10,000/- ON ACCOUNT OF SALE OF TREES TO SHRI KHAL IL. THE LD. CIT(A) NOTED THAT ASSESSEE CLAIMED TO HAVE RECEIVED A SUM OF RS. 4,10,000/- BY WAY OF SALE OF TREES FROM MR. KHALIL. MR. KHALIL AP PEARED BEFORE THE AO AND CONFIRMED THE TRANSACTION. HE ALSO SUBMITTED TH AT HE HAD RECEIVED MONEY FROM A COMMISSION AGENT OF TIMBER. THE AO WAS NOT SATISFIED WITH THE EXPLANATION OF THE ASSESSEE AS NO DOCUMEN TARY EVIDENCE RELATING TO THE TRANSFER OF MONEY BETWEEN THE COM MISSION AGENT AND MR. KHALI AND BETWEEN HIM AND THE ASSESSEE WAS PR ODUCED. THE AO THEREFORE TREATED THE SAID SUM OF ASSESSEES UNDISC LOSED INCOME. IN APPEAL, ASSESSEE SUBMITTED THAT HE HAD DISCHARGED I TS ONUS BY PRODUCING MR. KHALIL AND THAT HE WAS NOT REQUIRED TO EXPLAIN THE SOURCE ITA NOS. 2939,2940/DEL/2013 LATE SHRI PREM SINGH VS. ITO AND SMT. REETA VS. ITO PAGE 6 OF 8 OF MONEY IN THE HANDS OF THE LATTER. LD. CIT(A) FO UND THAT MERELY BECAUSE MR. KHALIL HAS CONFIRMED GIVING MONEY TO TH E ASSESSEE, IT WOULD NOT MEAN THAT TRANSACTION WAS EXPLAINED. THE CAPACI TY OF THE BUYER AND THE GENUINENESS OF THE TRANSACTION ARE AS IMPORTANT FACTOR WHICH SHOULD BE ESTABLISHED. THE ASSESSEE HAS NOT PROVED ANYTHIN G. THEREFORE ORAL TESTIMONY OF MR. KHALIL WILL NOT SUFFICE. THE ADDI TION WAS CONFIRMED AND THIS GROUND WAS DISMISSED. 9. AFTER CONSIDERING RIVAL SUBMISSIONS, WE DO NOT F IND ANY MERIT IN THIS GROUND OF APPEAL OF ASSESSEE. LD. COUNSEL FOR ASSESSEE REITERATED THE SUBMISSIONS MADE BEFORE AUTHORITIES BELOW AND R EFER TO RECEIPT EXECUTED BY MR. KHALIL COPY OF WHICH IS FILED AT PA GE 10 OF THE PAPER BOOK IN WHICH MR. KHALIL HAS EXPLAINED THAT HE HAS GIVEN RS. 4,10,000/- TO THE ASSESSEE ON SALE OF POPULAR TREES. IN HIS ST ATEMENT RECORDED BY AO HE HAS CONFIRMED THE SAME FACTS. HOWEVER, LD. CO UNSEL FOR ASSESSEE WAS NOT ABLE TO PRODUCE ANY EVIDENCE IF ANY ACTUAL AMOUNT WAS GIVEN TO THE ASSESSEE FOR SALE OF POPULAR TREE. NO EVIDENCE IN SUPPORT OF HIS CLAIM OF SALE OF TREES HAS BEEN FILED. IN THE ABSENCE OF ANY EVIDENCE TO PROVE THAT ASSESSEE WAS OWNER OF POPULAR TREES OR HE HAS ACTUALLY SOLD THE POPULAR TREE TO MR. KHALI, NO INTERFERENCE IS CALLE D FOR IN THE MATTER. SIMILARLY PRODUCTION OF RECEIPT AND STATEMENT RECOR DED BY AO ORALLY IS NOT SUFFICIENT TO DISCHARGE ONUS UPON ASSESSEE TO P ROVE GENUINENESS OF THE TRANSACTION IN THE MATTER AND ACTUAL SALE TRANS ACTION OF POPULAR TREE . IN THE ABSENCE OF ANY EVIDENCE OR MATERIAL ON REC ORD NO INTERFERENCE IS ITA NOS. 2939,2940/DEL/2013 LATE SHRI PREM SINGH VS. ITO AND SMT. REETA VS. ITO PAGE 7 OF 8 CALLED FOR IN THE MATTER. THIS GROUND OF APPEAL OF ASSESSEE IS ACCORDINGLY DISMISSED. 10. IN THE RESULT APPEAL OF ASSESSEE IS DISMISSED. ITA 2940/DEL-2013 ASSESSMENT YEAR 2009-10 11. THIS APPEAL BY ASSESSEE HAS BEEN DIRECTED AGAIN ST ORDER OF LD. CIT(A) DEHRADUN I DATED 18 TH FEBRUARY, 2013 FOR ASSESSMENT YEAR 2009- 10. 12. LD. COUNSEL FOR ASSESSEE DID NOT PRESS GROUND N O. 4 OF APPEAL OF ASSESSEE. THE SAME IS DISMISSED AS NOT PRESSED. GRO UND NO. 1 AND 2 ARE GENERAL WHICH NEED NO ADJUDICATION. 13. IN GROUND NO. 3 ASSESSEE CHALLENGED THE ADDITIO N OF RS. 1,20,000/- OUT OF OPENING CAPITAL OF RS. 2,20,000/- . LD. REPRESENTATIVE OF BOTH THE PARTIES SUBMITTED THAT THIS ISSUE IS SA ME AS HAS BEEN CONSIDERED ON GROUND NO. 3 OF APPEAL OF ASSESSEE LA TE SHRI PREM SINGH IN ITA NO. 2939/2013. FOLLOWING THE REASON FOR DECI SION IN THE CASE OF SHRI PREM SINGH WE DISMISS THIS GROUND OF APPEAL OF ASSESSE. 14. IN THE RESULT APPEAL OF ASSESSEE IS DISMISSED. IN THE RESULT BOTH THE APPEALS OF ASSESSEE ARE DIS MISSED. PRONOUNCED IN THE OPEN COURT. SD/- SD/- (PRASHANT MAHARISHI) ( BHAVNESH SAINI ) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 06/6/2017 *VEENA* ITA NOS. 2939,2940/DEL/2013 LATE SHRI PREM SINGH VS. ITO AND SMT. REETA VS. ITO PAGE 8 OF 8 COPY FORWARDED TO: - 1. APPELLANT 2. RESPONDENT 3. PRINCIPAL CIT 4. CIT(A) 5. DR, ITAT TRUE COPY BY ORDER, ASSISTANT REGISTRAR