Smt. Veena Bhatia, Indore V. The Addl.CIT Range-3, Indore

ITA 295/IND/2011

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 6156 (ITAT-INDORE)
• Duration Of Justice: 4 year(s) 6 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-05-2016
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 11-05-2016
• Assessment Year: 2008-2009
• Appeal Filed On: 28-10-2011
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: RAJEEV VARSHNEY; R A VERMA DRS
• Assessee Lawyers: ARPIT GAUR CAS
• Keywords: Unexplained investment; Opportunity of being heard
• Section: 143(3); 142(1); 14A

Judgement Text

VEENA BHATIA [TYPE THE DOCUMENT TITLE] 1 IN THE INCOME TAX APPELLATE TRIBUNAL INDORE BENCH, INDORE BEFORE SHRI D.T. GARASIA, JUDICIAL MEMBER AND SHRI B.C. MEENA, ACCOUNTANT MEMBER ITA NO.295/IND/2011 A.Y. 2008-09 SMT. VEENA BHATIA, INDORE PAN AEKPB 7309 B :: ASSESSEE VS ADDL. CIT, RANGE-3, INDORE :: RESPONDENT ASSESSEE BY SHRI ANIL KAMAL GARG AND SHRI ARPIT GAUR, CAS RESPONDENT BY SHRI RAJEEV VARSHNEY AND SHRI R.A. VERMA, DRS DATE OF HEARING 18.5.2016 DATE OF PRONOUNCEMENT 18.5.2016 O R D E R PER SHRI D.T. GARASIA, JM THE ABOVE APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF LD. CIT(A)-I, INDORE, DATED 05.8.2011. 2. SHORT FACTS OF THE CASE ARE THAT THE ASSESSEE IS AN INDIVIDUAL, PRESENTLY AGED NEARLY 57 YEARS. THE ASSESSEE IS REG ULARLY ASSESSED TO INCOME-TAX FOR THE LAST MANY YEARS. A SEARCH U/S. 1 32(1) OF THE INCOME- TAX ACT, 1961 WAS CARRIED OUT BY THE ASSISTANT DIRE CTOR OF INCOME-TAX (INV.)-II, INDORE, ON 25-09-2007, IN THE RESIDENTIA L PREMISES OF THE ASSESSEE AS ALSO IN THE BUSINESS PREMISES IN WHICH FAMILY MEMBERS/RELATIVES OF THE ASSESSEE WERE HAVING VESTE D INTEREST. DURING VEENA BHATIA [TYPE THE DOCUMENT TITLE] 2 THE COURSE OF THE SEARCH, THE BHATIA GROUP HAD ADMI TTED ADDITIONAL INCOME AGGREGATING TO RS.26,15,24,529/- AND AS AGAI NST SUCH ADMITTED INCOME OF RS.26,15,24,529/-, THE GROUP, AS A WHOLE, HAD SHOWN AN ADDITIONAL INCOME OF RS.27,33,73,087/- IN THE RETUR NS OF INCOME FURNISHED UNDER S.153A OF THE ACT. HOWEVER, THE ASS ESSEE NEITHER ADMITTED NOR DECLARED ANY ADDITIONAL INCOME IN HIS RETURN OF INCOME. SUCH FACTS ARE EVIDENT FROM THE FINDINGS GIVEN BY T HE CIT(A) AT PARA 2 & 2.1 AT PAGE NO. 2 & 3 OF HIS ORDER. THE CASE OF THE ASSESSEE WAS SELECTED FOR SCRUTINY AND NOTICES U/S. 143(2) & 142 (1) ALONG WITH A QUESTIONNAIRE WERE ISSUED FOR THE FIRST TIME ON 25- 08-2008. COPIES OF THE NOTICES U/S. 142(1) ALONG WITH A COPY OF QUESTIONNA IRE ARE PLACED AT PAGE NO. 1 TO 3 OF THE PAPER BOOK. THE ASSESSEE FUR NISHED HER RETURN OF TOTAL INCOME FOR THE RELEVANT ASSESSMENT YEAR ON 11-12-2008 VIDE ACK. NO. 0030100955 DECLARING AN INCOME OF RS.1,59, 400/-. ALONG WITH THE RETURN AND COMPUTATION OF TOTAL INCOME, THE ASS ESSEE HAD FURNISHED COPY OF CAPITAL ACCOUNT AND ALSO HER STAT EMENT OF AFFAIRS RELEVANT TO THE PREVIOUS YEAR UNDER REVIEW (PB PAGE NO. 30 TO 37). IN RESPONSE TO THE NOTICES ISSUED, THE ASSESSEE THROUG H HER AUTHORIZED REPRESENTATIVE ATTENDED THE HEARING BEFORE THE ASSE SSING OFFICER FROM TIME TO TIME AND MADE WRITTEN SUBMISSIONS DATED 07- 08-2009 AND 21-12- 2009 ALONG WITH NECESSARY DOCUMENTARY EVIDENCES. CO PIES OF SUCH WRITTEN SUBMISSIONS ARE PLACED AT PAGE NO. 38 TO 11 1 OF THE PAPER BOOK. FINALLY, THE LEARNED ASSESSING OFFICER FRAMED THE ASSESSMENT ON 22-12-2009, U/S. 143(3) OF THE INCOME-TAX ACT, 1961 , DETERMINING THE INCOME OF THE ASSESSEE AT RS.15,38,610/- AS AGAINST THE RETURNED INCOME OF RS.1,59,400/- THEREBY MAKING ADDITIONS OF RS.13,79,210/-, AS PER DETAILS GIVEN BELOW: S.NO. PARTICULARS AMOUNT VEENA BHATIA [TYPE THE DOCUMENT TITLE] 3 (RS.) 1 ADDITION ON ACCOUNT OF ALLEGED UNEXPLAINED INVESTMENT IN JEWELLERY SEIZED DURING THE COURSE OF SEARCH ON SUBSTANTIVE BASIS 13,23,000 2 ADDITION ON ACCOUNT OF DIVIDEND UNDER RULE 8D R.W.S. 14A 56,210 TOTAL ADDITIONS 13,79,210 3. MATTER CARRIED TO LEARNED CIT(A), WHO DELETED TH E ADDITION OF RS.56,210/- MADE BY THE AO ON ACCOUNT OF DIVIDEND U NDER RULE 8D R.W.S. 14A. HOWEVER, THE CIT(A) CONFIRMED THE ADDIT ION OF RS.13,23,000/- MADE BY THE AO ON ACCOUNT OF ALLEGED UNEXPLAINED JE WELLERY SEIZED DURING THE COURSE OF SEARCH. AGAINST THE ORDER OF THE CIT(A), THE ASSESSEE IS IN APPEAL BEFORE THIS TRIBUNAL. GROUND NO. 1 4. THIS GROUND IS DIRECTED AGAINST THE CIT(A)S FIN DING OF UPHOLDING AOS ACTION OF PASSING THE ASSESSMENT ORDER ARBITRA RILY WITHOUT GIVING PROPER OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. THE CIT(A) HAS DEALT WITH THIS GROUND. ACCORDING TO THE CIT(A), THE ASSE SSEE WAS GIVEN DUE OPPORTUNITY BY THE AO. BEFORE US, LD. COUNSEL FOR T HE ASSESSEE DID NOT PRESS THIS GROUND. THEREFORE, SAME IS DISMISSED BEI NG NOT PRESSED. GROUND NO. 2 5. THIS GROUND IS DIRECTED AGAINST THE CIT(A)S ACT ION OF CONFIRMING THE ADDITION OF RS.13,23,000/- MADE BY THE AO ON AC COUNT OF ALLEGED UNEXPLAINED INVESTMENT IN JEWELLERY SEIZED FROM THE BANK LOCKER OF THE ASSESSEE DURING THE COURSE OF THE SEARCH. VEENA BHATIA [TYPE THE DOCUMENT TITLE] 4 6. SHORT FACTS OF THE ISSUE ARE THAT THE AO HAS DEA LT WITH THE ISSUE AT PARA 1, ON PAGE NO. 3 OF HIS ORDER. THE AO, AT PARA 1 OF THE ORDER, NOTED THAT DURING THE COURSE OF SEARCH, JEWELLERY AMOUNTI NG TO RS.13,23,000/- WAS SEIZED FROM THE LOCKER NO.C14, UNION BANK OF IN DIA, VISHNUPURI BRANCH, INDORE. IN ORDER TO EXPLAIN THE SOME OF THE JEWELLERY, THE ASSESSEE PRODUCED CERTAIN PURCHASE BILLS. THE ASSES SING OFFICER, CONSIDERING THE FACTS AND MATERIAL, HELD THAT THE B ILLS PRODUCED IN RESPECT OF THE JEWELLERY PURCHASES WAS AN AFTERTHOUGHT AND THE BILLS HAVE BEEN TAKEN FROM THE JEWELLERS BECAUSE THESE BILLS ARE IN SERIAL NO. EVEN IN LAPSE OF ONE OR TWO DAYS. THE AO FURTHER HELD THAT THAT THE ASSESSEE HAS TRIED TO TAKE ADVANTAGE OF CASH WITHDRAWALS DURING THESE MONTHS. CONSEQUENTLY, THE AO BY DISREGARDING THE EXPLANATIO N OF THE ASSESSEE, MADE AN ADDITION OF RS.13,23,000/- IN THE HANDS OF THE ASSESSEE ON SUBSTANTIVE BASIS. THE AO MADE A CORRESPONDING ADDI TION IN THE HANDS OF THE HUSBAND OF THE ASSESSEE NAMELY SHRI GURVINDE R SINGH BHATIA ON PROTECTIVE BASIS. 7. MATTER CARRIED TO LEARNED CIT(A), WHO HAS DEALT WITH THE ISSUE AT PARA 4.2, PAGE NO. 10 TO 12 OF THE ORDER. THE CIT( A) HAS CONFIRMED THE ADDITION OF RS.13,23,000/- MADE BY THE AO ON ACCOUN T OF ALLEGED UNEXPLAINED INVESTMENT IN JEWELLERY SEIZED DURING T HE COURSE OF SEARCH FROM THE BANK LOCKER OF THE ASSESSEE BY HOLDING THA T THE ADDITION HAS RIGHTLY BEEN MADE BY THE AO. THE CIT(A) WAS OF THE VIEW THAT THE JEWELLERY ACCOUNT COULD BE PREPARED BUT THE SUPPORT ING PURCHASE BILLS COULD NOT BE ARRANGED TILL THAT DAY. 8. THE LD. AR FOR THE ASSESSEE HAS MADE ORAL AS WEL L AS WRITTEN SUBMISSION AS UNDER: VEENA BHATIA [TYPE THE DOCUMENT TITLE] 5 1.00 THAT, DURING THE COURSE OF THE SEARCH PROCEED INGS, JEWELLERY FOR AN AGGREGATE VALUE OF RS.13,23,000/- WAS FOUND AND SEI ZED FROM THE BANK LOCKER OF THE ASSESSEE. 2.01 THAT, A STATEMENT UNDER S.132(4) OF THE ACT OF THE ASSESSEE WAS RECORDED BY THE SEARCH PARTY. THE ASSESSEE, VIDE Q. NO. 3, WAS ASKED TO FURNISH HER EXPLANATION REGARDING JEWELLERY OF RS.13,23,000 /- FOUND AND SEIZED FROM HER BANK LOCKER. IN RESPONSE, THE ASSESSEE ANSWERED THA T OUT OF THE TOTAL JEWELLERY OF 3152.780 GMS., JEWELLERY WEIGHING APPROX. 750-800 G MS. WERE BELONGING TO HER DAUGHTER IN LAW NAMELY SMT. HARLEEN KAUR BHATIA AND JEWELLERY WEIGHING APPROX. 1000 GMS. WERE PURCHASED BY HER HUSBAND NAM ELY SHRI GURVINDER SINGH BHATIA FOR A SUM OF RS.11,50,000/-. THE ASSES SEE ALSO FURNISHED A COPY OF LEDGER ACCOUNT OF JEWELLERY IN THE BOOKS OF SHRI GU RVINDER SINGH BHATIA IN WHICH THE AFORESAID JEWELLERY OF RS.11,50,000/- WAS DULY GETTING REFLECTED. HOWEVER, THE ASSESSEE COULD NOT FURNISH THE COPY OF PURCHASE BILL OF JEWELLERY AT THAT TIME BEFORE THE SEARCH PARTY. FURTHER, THE ASSESSEE EXPR ESSED HER INABILITY TO OFFER ANY EXPLANATION IN RESPECT OF THE REMAINING JEWELLE RY AND SUBMITTED THAT THE NECESSARY EXPLANATION COULD BE GIVEN BY HER HUSBAND SHRI GURVINDER SINGH BHATIA ONLY. 2.02 THAT, DURING THE COURSE OF THE POST-SEARCH ASS ESSMENT PROCEEDINGS, THE ASSESSEE, VIDE HER LETTER DATED 07-08-2009 [KIN DLY REFER PB PAGE NO. 38 & 39], FURNISHED DETAILED EXPLANATION IN RESPECT OF T HE JEWELLERY SEIZED FROM THE BANK LOCKER AND ALSO FURNISHED VARIOUS NECESSARY DO CUMENTARY EVIDENCES SUCH AS WEALTH TAX RETURNS, COPIES OF PURCHASE BILLS IN RESPECT OF PURCHASES OF JEWELLERY ETC. [KINDLY REFER PB PAGE NO. 40 TO 111] . 2.03 THAT, THE AO, WITHOUT ASSIGNING ANY REASON, DI SREGARDED THE EXPLANATION OF THE ASSESSEE AND ADDED A SUM OF RS.1 3,23,000/- TO THE TOTAL INCOME OF THE ASSESSEE. 3.01 THAT, DURING THE COURSE OF APPELLATE PROCEEDIN GS, THE ASSESSEE FURNISHED A DETAILED EXPLANATION BEFORE THE CIT(A) VIDE HIS LETTER DATED NIL [KINDLY REFER PB PAGE NO. 112 TO 114]. 3.02 THAT, DURING THE COURSE OF SIMULTANEOUS APPELL ATE PROCEEDINGS IN THE CASE OF THE HUSBAND OF THE ASSESSEE NAMELY SHRI GUR VINDER SINGH BHATIA, A DETAILED EXPLANATION BEFORE THE CIT(A) WAS ALSO FUR NISHED BY SHRI GURVINDER SINGH BHATIA VIDE LETTER DATED NIL [KINDLY REFER PB PAGE NO. 115 TO 119]. 4.00 THAT, THE CIT(A) DID NOT CONSIDER THE EXPLANAT ION OF THE ASSESSEE AND VARIOUS DOCUMENTARY EVIDENCES FURNISHED BY THE ASSE SSEE IN SUPPORT OF HIS CONTENTION. FINALLY, THE CIT(A) ALLEGED THAT THE AS SESSEE FAILED TO GIVE ANY SATISFACTORY EXPLANATION AND CONFIRMED THE ADDITION OF RS.13,23,000/- IN THE HANDS OF THE ASSESSEE. 5.00 IT IS SUBMITTED THAT THE ASSESSEE HAS PROPERLY EXPLAINED THE SOURCE OF JEWELLERY SEIZED FROM HER BANK LOCKER ALONG WITH NE CESSARY EVIDENCES. IN VIEW OF THE ABOVE FACTS AND CIRCUMSTANCES OF THE CASE, THE ADDITION OF RS.13,23,000/- SO MADE BY THE AO AND CONFIRMED BY T HE CIT(A) ON ACCOUNT OF JEWELLERY SEIZED DURING THE COURSE OF SEARCH DESERV ES TO BE DELETED IN TOTO. RELEVANT DOCUMENTS FILED IN THE PAPER BOOK ON WHICH THE ASSESSEE IS PLACING RELIANCE FOR THIS GROUND VEENA BHATIA [TYPE THE DOCUMENT TITLE] 6 PAGE NO. NATURE OF DOCUMENT FILED FOR THE PURPOSE OF FROM TO 7 29 COPIES OF STATEMENTS OF SMT. VEENA BHATIA, SHRI GURVINDER SINGH BHATIA, SHRI AMANDEEP SINGH BHATIA AND SMT. HARLEEN KAUR BHATIA RECORDED DURING THE COURSE OF SEARCH ESTABLISHING THAT THE NECESSARY EXPLANATION AS REGARD TO JEWELLERY HAS BEEN GIVEN DURING THE COURSE OF RECORDING THE STATEMENT UNDER S.132(4) 38 111 COPY OF REPLY FILED BEFORE AO ALONG WITH ENCLOSURES IN RESPECT OF JEWELLERY ESTABLISHING THAT A DETAILED EXPLANATION IN RESPECT OF JEWELLERY ALONG WITH NECESSARY DOCUMENTARY EVIDENCES HAVE BEEN FURNISHED BEFORE THE AO 112 114 COPY OF REPLY FILED BEFORE CIT(A) ESTABLISHING THAT A DETAILED EXPLANATION IN RESPECT OF JEWELLERY HAS ALSO BEEN MADE BEFORE THE CIT(A) 115 119 COPY OF WRITTEN SUBMISSION FILED BEFORE CIT(A) IN THE CASE OF SHRI GURVINDER SINGH BHATIA ESTABLISHING THAT A DETAILED EXPLANATION IN RESPECT OF JEWELLERY HAS ALSO BEEN MADE BEFORE THE CIT(A) BY SHRI GURVINDER SINGH BHATIA 9. LD. DRS HAS RELIED ON THE ORDERS OF THE REVENUE AUTHORITIES. 10. WE HAVE HEARD RIVAL CONTENTIONS OF BOTH THE PAR TIES AND PERUSED MATERIAL AVAILABLE ON RECORD. WE FIND THAT DURING T HE SEARCH, GOLD JEWELLERY WEIGHING 5814.980 GMS WERE FOUND FROM THE POSSESSION OF SHRI G.S. BHATIA, HER WIFE SMT. VEENA BHATIA I.E. P RESENT ASSESSEE AND OTHER FAMILY MEMBERS. THE ASSESSEE FILED RECONCILIA TION STATEMENT WHEREIN IT WAS EXPLAINED THAT THE QUANTITY TO THE E XTENT OF 1712.750 GMS WAS PURCHASED BY SHRI G.S. BHATIA AND SHRI AMANDEEP SINGH BHATIA FROM JAVERI BALKRISHNA GOVARDHANDAS SONI, INDORE. T HE ASSESSING OFFICER NOTED THAT THE BILLS WERE NOT FOUND DURING SEARCH BUT WERE PRODUCED DURING THE COURSE OF ASSESSMENT PROCEEDING S. ON VERIFICATION VEENA BHATIA [TYPE THE DOCUMENT TITLE] 7 OF THE BILLS, THE ASSESSING OFFICER NOTED THAT THES E BILLS WERE RUNNING CONTINUOUS SERIAL NUMBERS EVEN IN THE LAPSE OF ONE OR TWO DAYS WHICH WOULD MEAN THAT THE JEWELLERS HAD NOT SOLD THOSE DA YS JEWELLERY TO ANY PERSON OTHER THAN SHRI G.S. BHATIA OR AMANDEEP SING H BHATIA AND AS SUCH, THE ASSESSING OFFICER HELD THE EXPLANATION OF THE ASSESSEE AS AN AFTERTHOUGHT. THE LD. CIT(A) CONFIRMED THE ACTION O F THE ASSESSING OFFICER ON THE GROUND THAT THE JEWELLERY ACCOUNT CO ULD BE PREPARED BUT THE SUPPORTING PURCHASE BILLS COULD NOT BE ARRANGED TILL THAT DAY. ON CONSIDERATION OF THE FACTS AND CIRCUMSTANCES AND SU BMISSIONS THEREOF, WE FIND THAT BEFORE US TOO, THE ASSESSEE COULD NOT BE ABLE TO CONTROVERT THE FACTUAL FINDINGS RECORDED BY THE REVENUE AUTHOR ITIES BY BRINGING ANY POSITIVE MATERIAL ON RECORD. THUS, WE DO NOT FIND A NY MERIT IN THIS GROUND OF THE ASSESSEE. THEREFORE, THE ORDER OF THE LD. CI T(A) IS CONFIRMED. ACCORDINGLY, THIS GROUND OF THE APPEAL OF THE ASSES SEE IS DISMISSED. 11. IN RESULT, THE APPEAL OF THE ASSESSEE IS DISMIS SED. ORDER WAS PRONOUNCED IN THE OPEN COURT ON 18.5.201 6. SD/- (B.C. MEENA) ACCOUNTANT MEMBER SD/- ( D.T. GARASIA) JUDICIAL MEMBER DATED : 18.5.2016 COPY TO: ASSESSEE/RESPONDENT/CIT(A)/CIT/DR, INDORE