Sheela Varghese, CHENNAI V. ITO International Taxation Ward 2(2), CHENNAI

ITA 2943/CHNY/2017

• Counselvise Citation: [2018] 121 COUNSELVISE.COM (IT) 5285 (ITAT-CHENNAI)
• Duration Of Justice: 4 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-04-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Assessment Year: 2014-2015
• Appeal Filed On: 01-12-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: VIJAYAPRABHA
• Assessee Lawyers: SHRIS RAJAGOPALAN
• Keywords: Unexplained cash credit
• Section: 143(3)

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL , D B ENCH, CHENNAI . , ! ' ! # . $ , %& BEFORE SHRI A.MOHAN ALANKAMONY, ACCOUNTANT MEMBER AND SHRI DUVVURU RL REDDY, JUDICIAL MEMBER ./ I.T.A.NO.2943/CHNY/2017 ( / ASSESSMENT YEAR: 2014-15) SMT. SHEELA VARGHESE, D/O. JOHN VARGHESE, NO.9, IAF STATION ROAD, EAST TAMBARAM, CHENNAI 600 059. VS THE INCOME TAX OFFICER, INTERNATIONAL TAXATION WARD 2(2), CHENNAI. PAN: DUSPS5304G ( /APPELLANT) ( /RESPONDENT) / APPELLANT BY : SHRIS. RAJAGOPALAN, CA / RESPONDENT BY : SMT. VIJAYAPRABHA, JCIT /DATE OF HEARING : 25.04.2018 /DATE OF PRONOUNCEMENT : 26.04.2018 / O R D E R PER A. MOHAN ALANKAMONY, AM:- THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER PASSED BY THE LD. COMMISSIONER OF INCOME TAX (APPEALS)-16, CHENNAI DATED 21.09.2017 IN ITA NO.106/CIT(A)-16/2014-15 FOR THE ASSESSMENT YEAR 2014-15 PASSED U/S.250(6)R.W.S. 143(3) OF THE ACT. 2. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS IN HER APPEAL:- 1. THE ASSESSING OFFICER DID NOT SPECIFY THE SECTI ON OF THE INCOME TAX ACT UNDER WHICH THE ADDITIONS TO THE REPORTED INCOME IS MADE. THE ASSESSMENT ORDER MERELY MAKES ADJUSTMENTS TO ADMITTED INCOME BY REFERRING T O INCOME FROM OTHER SOURCES AS 2 ITA NO.2943/CHNY /20 17 EXPLAINED IN PARA4.4.IN THE ABSENCE OF MENTION OF RELEVANT TAXING SECTION OF INCOME TAX ACT, THE ASSESSMENT ORDER IS NOT VALID AND THER EFORE NULL AND VOID 2. THE ASSESSEE IS NOT HAVING INDEPENDENT INCOME AN D SHE IS THE JOINT HOLDER OF BANK ACCOUNT IN ALL THE BANK ACCOUNTS WHILE HER HUSBAND IS THE ABSOLUTE OWNER OF THE AFORESAID BANK ACCOUNTS. THIS IS BECAUSE HUSBAND BO UGHT THE LAND WITH HIS EARNINGS ABROAD AND SOLD THE SAME. INCIDENTALLY THE SALE PRO CEEDS OF LAND WERE DEPOSITED IN TO THE BANK ACCOUNT WHERE THE ASSESSEE AND HER HUSBAND ARE JOINT HOLDERS. EVEN THE SO CALLED UNEXPLAINED SOURCE MONEY WAS DEPOSITED IN TO THE SAME BANK ACCOUNT WHERE THE HUSBAND AND WIFE ARE JOINT ACCOUNT HOLDER S. THE ENTIRE SALE CONSIDERATION WAS OFFERED FOR INCOME TAX UNDER THE HEAD INCOME F ROM CAPITAL GAINS IN THE HANDS OF MR. GHEE VERGHESE, HUSBAND OF THE ASSESSEE . GIVEN THIS BACKGROUND, TAXING THE SALE CONSIDERATION AS INCOME FROM UNEXPLAINED SOURCE ONCE AGAIN IN THE HANDS OF ASSESSEE WIFE IS DEVOID OF MERITS AND IS T HEREFORE REQUIRED TO BE SET ASIDE. 3. THE RECEIPT OF SALE CONSIDERATION OF RS.1,23,00, 000/- HAD ARISEN OUT SALE DEEDS REGISTERED III FAVOR OF 2 BUYERS BY THE APPELLANT A ND HER HUSBAND ON 22/11/2013 AND CASH DEPOSITS IN TO THE BANK ACCOUNT ON THE SAME DA TE FOR THE CORRESPONDING AMOUNT ESTABLISHES A VERY STRONG ONE TO ONE RELATIONSHIP B ETWEEN CASH DEPOSITS IN TO BANK AND THE SALE CONSIDERATION. THEREFORE THE SOURCE OF CASH DEPOSITS IS VERY WELL EXPLAINED AND THEREFORE CANNOT BY ANY MEANS DESCRIB ED AS INCOME FROM UNEXPLAINED SOURCE AND TAX LEVIED THEREON. 4. THE DEFINITION OF UNEXP1AINED CREDITS MEANS ANY CREDIT IN THE BOOKS OF ACCOUNTS WHICH IS NOT EXPLAINED. BY THE SAME DEFINITION, BO OKS OF ACCOUNTS DOES NOT INCLUDE BANK STATEMENT FOR THIS PURPOSE. THEREFORE THE TE RM UNEXPLAINED CREDITS MENTIONED IN THE ASSESSMENT ORDER DATED 29/12/2016 SHOULD NOT INCLUDE CREDITS FOUND IN THE BANK STATEMENT OF THE APPELLANT FOR TH E PURPOSE OF THIS DEFINITION. 5. THE SALE PROCEEDS FROM THE PROPERTY AS DEPOSITED INTO THE BANK ACCOUNT OF THE APPELLANT IS GIVEN IN ANNEXURE. THE BANK EXTRACTS G IVE THE DETAILS OF ALL THE DEPOSITS IN TO THE BANK ACCOUNTS OF THE APPELLANT DURING THE RELEVANT PERIOD. THE PROCEEDS OF SALE OF PROPERTY INCLUDED A SUM OF RS.1,23,00,000/- (RS.61,50,000/- EACH ON TWO OCCASIONS). 6. THE PAYMENT DETAILS MENTIONED IN THE SALE DEEDS WERE NOT RECEIVED BY THE APPELLANT. HOWEVER, THE CORRESPONDING PAYMENTS WERE RECEIVED BY WAY OF RTGS / CASH REMITTANCE FROM THE BUYERS OF THE PROPERTIES. THESE PAYMENTS ARE GIVEN IN THE BANK PARTICULARS SHOWN IN ANNEXURE AS ABOVE. 7. THE CONNECTION DOTS BETWEEN BUYERS OF THE LAND T O THE PAYMENTS RECEIVED BY THE APPELLANT IS TO BE ESTABLISHED. THE APPELLANT IS SI TUATED ABROAD AND BUYERS ARE SITUATED IN VARIOUS PLACES IN INDIA. THE CONNECTING DOT IN THIS CASE IS THE SALE 3 ITA NO.2943/CHNY /20 17 AGREEMENT. THE SALE AGREEMENT WILL ESTABLISH THE CA SH DEPOSITS LINKAGE TO THE SALE PROCEEDS OF LAND. 8. FOR THE REASONS CITED ABOVE, IT IS SUBMITTED THA T THE ORDER OF THE ITO, INTERNATIONAL TAXATION WARD 2(2) DATED 29/12/2016 MAY BE SET ASID E AND A FRESH ASSESSMENT MAY BE ORDERED TO PRODUCE FURTHER EVIDENCE AND OBTAIN F AIR AND JUST ASSESSMENT ORDER FOR THE APPELLANT. 3. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSE E IS A NON-RESIDENT INDIVIDUAL FILED HER RETURN OF INCOME FOR THE ASSES SMENT YEAR 2014-15 ON 02.08.2014 ADMITTING TOTAL INCOME OF RS.46,830/-. THE CASE WAS SELECTED FOR SCRUTINY UNDER CASS AND NOTICE U/S.143(2) OF THE AC T WAS ISSUED ON 31.08.2015. FINALLY ASSESSMENT ORDER WAS PASSED U/ S.143(3) OF THE ACT ON 29.12.2016 WHEREIN THE LD.AO MADE ADDITION OF RS.1, 23,13,500/- TOWARDS INCOME FROM OTHER SOURCES. 4. AT THE OUTSET THE LD.AR SUBMITTED FRESH EVIDENCE BEFORE US. THE LD.AR FURTHER SUBMITTED THAT THE ASSESSEE WAS A NRI AND THEREFORE COULD NOT FURNISH THE REQUISITE MATERIALS BEFORE THE AUTHORIT IES AT THE APPROPRIATE TIME. HENCE IT WAS PLEADED THAT THE MATTER MAY BE REMITTE D BACK TO THE FILE OF LD.AO FOR FRESH CONSIDERATION TO DECIDE THE MATTER IN THE LIGHT OF THE EVIDENCE PRODUCED BEFORE THE TRIBUNAL FOR THE FIRST TIME. TH E LD.DR VEHEMENTLY OPPOSED TO THE SUBMISSION OF THE LD.AR AND REQUESTE D THAT THE APPEAL OF THE ASSESSEE MAY BE DISMISSED. 5. WE HAVE HEARD THE RIVAL SUBMISSIONS AND CAREFULLY P ERUSED THE MATERIALS AVAILABLE ON RECORD. CONSIDERING THE SUBM ISSION OF THE LD.AR, 4 ITA NO.2943/CHNY /20 17 WE ARE OF THE CONSIDERED VIEW THAT THE FRESH INFORM ATION SUBMITTED BY THE LD.AR BEFORE THE BENCH IS RELEVANT FOR DECIDING THE CASE OF THE ASSESSEE. THEREFORE IN THE INTEREST OF JUSTICE, WE HEREBY REMIT THE MATTER BACK TO THE FILE OF LD.AO FOR DE-NOVA CONSID ERATION WITH DIRECTIONS TO ADMIT ANY FRESH EVIDENCE SUBMITTED BY THE ASSESSEE AT THE TIME OF HEARING AND THEREAFTER PASS APPROPRIATE ORD ER IN ACCORDANCE WITH LAW AND MERITS. AT THE SAME TIME, WE ALSO CAU TION THE ASSESSEE TO PROMPTLY CO-OPERATE BEFORE THE LD.REVENUE AUTHORITI ES IN THEIR PROCEEDINGS IN ORDER TO EXPEDITE THEIR ORDERS FAILI NG WHICH THE LD.REVENUE AUTHORITIES SHALL BE AT LIBERTY TO PASS APPROPRIATE ORDER BASED ON THE MATERIALS ON RECORD. 6. IN THE RESULT THE APPEAL OF THE ASSESSEE IS ALLO WED FOR STATISTICAL PURPOSES AS INDICATED HEREIN ABOVE. ORDER PRONOUNCED ON THE 26 TH APRIL, 2018 AT CHENNAI. SD/- SD/- ( ! ' ! # . $ ) ( . ) ( DUVVURU RL REDDY ) ( A. MOHAN ALANKAMONY ) # $% /JUDICIAL MEMBER $% / ACCOUNTANT MEMBER &# /CHENNAI, '$ /DATED 26 TH APRIL, 2018 5 ITA NO.2943/CHNY /20 17 RSR $( )*+* /COPY TO: 1. /APPELLANT 2. /RESPONDENT 3. . ( )/CIT(A) 4. . /CIT 5. */0 1 /DR 6. 023 /GF