Shri Sandeep Pravinbhai Engineer, Ahmedabad V. The DCIT, Circle-1, Ahmedabad

ITA 3029/AHD/2013

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 9857 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 11 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-11-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 21-11-2016
• Assessment Year: 2007-2008
• Appeal Filed On: 18-12-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: VIMAL I MEHTA
• Assessee Lawyers: VARTIK R CHOKSHI
• Keywords: Unexplained investment; Corroborative evidences
• Section: 147; 148; 6

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH, AHMEDABAD BEFORE SHRI R.P. TOLANI, JUDICIAL MEMBER ./ ITA NO. 3029/AHD/2013 / ASSESSMENT YEAR : 2007-08 SANDEEP PRAVINBHAI ENGINEER, A/1, SUPAL APARTMENT, NEHRUPARK, VASTRAPUR, AHMEDABAD-380054 PAN : AABPE 1175 D VS DCIT, CIRCLE-1, AHMEDABAD / (APPELLANT) / (RESPONDENT) ASSESSEE BY : SHRI VARTIK R. CHOKSHI, AR REVENUE BY : SHRI VIMAL I. MEHTA, SR DR / DATE OF HEARING : 21/11/2016 / DATE OF PRONOUNCEMENT: 22/11/2016 / O R D E R THIS APPEAL HAS BEEN FILED BY THE ASSESSEE AGAINST THE ORDER OF THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS)-III, A HMEDABAD DATED 24.10.2013 FOR ASSESSMENT YEAR 2007-08. 2. THE GROUNDS RAISED BY THE ASSESSEE READ AS UNDER :- 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE T HE LEARNED CIT(A) ERRED IN UPHOLDING VALIDITY OF REASSESSMENT PROCEED INGS INITIATED BY THE ASSESSING OFFICER U/S 147 OF THE I.T. ACT, LEADING TO FRAMING OF THE IMPUGNED REASSESSMENT ORDER DATED 23.12.2011. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE T HE LEARNED CIT(A) ERRED IN UPHOLDING ADDITION OF RS.5,28,000/- MADE B Y THE ASSESSING OFFICER ON THE ALLEGED GROUND OF UNEXPLAINED INVEST MENT IN PURCHASE OF PROPERTIES. 3. GROUND NO.1 IN RESPECT OF REASSESSMENT PROCEEDIN GS U/S 148 OF THE ACT IS NOT PRESSED; HENCE THE SAME IS DISMISSED. 4. APROPOS GROUND NO.2 ON MERITS, THE BRIEF FACTS A RE THE ASSESSEE IS A SALARIED EMPLOYEE EARNING SALARY ABOUT RS.34 LAKHS PER ANNUM AND HIS WIFE SMC-ITA NO. 3029/AHD/2013 SANDEEP PRAVINBHAI ENGINEER VS. DCIT AY : 2007-08 2 IS ALSO AN INCOME-TAX ASSESSEE. THE ASSESSEE HAS P URCHASED A PIECE OF LAND AS PER THE DETAILS GIVEN BELOW:- I. BY CHEQUE - RS. 3,17,000/- II. BY CASH - RS. 5,28,000/- TOTAL - RS. 8,45,000/- DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE A SSESSEE FILED COMPLETE DETAILS ABOUT THE SOURCE OF AVAILABILITY O F CASH. ACCORDING TO ASSESSEE, THE ASSESSING OFFICER DID NOT CONSIDER TH E EXPLANATION AND SUMMARILY MADE THE ADDITION OF THE CASH AMOUNT OF R S.5,28,000/-. 5. AGGRIEVED BY THE ORDER OF THE ASSESSING OFFICER, THE ASSESSEE PREFERRED THE FIRST APPEAL WHERE THE ENTIRE EVIDENC E WAS FURNISHED IN THE FORM OF PAPER-BOOK CONTAINING 70 PAGES. LD. CIT(A) , THOUGH DID NOT DISPUTE THE CASH WITHDRAWAL FROM THE BANK ACCOUNT, HOWEVER, ON THE ASSUMPTIONS THAT THERE WAS NO NEED TO WITHDRAW CASH WHEN ALREADY THE CASH WAS WITHDRAWN FROM THE BANK, REJECTED THE ASSE SSEES EXPLANATION AND CONFIRMED THE ADDITION MADE BY THE AO BY FOLLOWING OBSERVATIONS:- 10. NORMALLY CASH WITHDRAWALS ARE MADE FROM BANK O NLY AS PER THE IMMEDIATE REQUIREMENT. NOBODY MAKES CASH WITHDRAWAL S FROM BANK FOR KEEPING THE CASH AT HOME. THE VERY FACT THAT APPELL ANT MADE CASH WITHDRAWALS OF RS.4,000 ON 7.7.2006 AND ANOTHER SUM OF RS.4,000 ON 11.8.2006 INDICATES THAT CASH WITHDRAWN BY HIM ON E ARLIER DATES WAS UTILIZED BY HIM ELSEWHERE. SIMILARLY, IN THE CASE OF HIS WIF E JAGRUTIBEN, CASH OF RS.5,000 WAS WITHDRAWN ON 24.7.2006 AND RS.10,000 O N 19.7.2006. IN SUCH A SITUATION ARGUMENT OF THE APPELLANT THAT OUT OF W ITHDRAWALS MADE IN F.Y. 2005-06, CASH OF RS.3,94,720 WAS AVAILABLE WITH HIM AS ON 31.3.2006 IS NOT ACCEPTABLE AND DESERVES REJECTION ON THE FACE OF IT . SIMILARLY, THE ARGUMENT THAT ANOTHER SUM OF RS.2,73,000 WAS AVAILABLE OUT O F DRAWINGS FROM BANK IN F.Y. 2006-07 IS ALSO NOT ACCEPTABLE FOR SIMILAR REA SON. AS MENTIONED BY A.O. ON PAGE NO.9 OF THE ASSESSMENT ORDER, CASH OF RS.5, 28,000 WAS PAID BY THE APPELLANT ON 24.8.2006, 28.11.2006 AND 20.12.2006. IN VIEW OF LARGE TIME GAP BETWEEN THESE DATES AND DATES OF EARLIER CASH W ITHDRAWALS, ARGUMENT OF THE APPELLANT REGARDING AVAILABILITY OF CASH WITH H IM IS REJECTED. I THEREFORE HOLD THAT A.O. HAS RIGHTLY MADE ADDITION OF RS.5,28 ,000 TREATING THE SAME AS UNACCOUNTED INVESTMENT AND THE ADDITION IS CONFIRME D. SMC-ITA NO. 3029/AHD/2013 SANDEEP PRAVINBHAI ENGINEER VS. DCIT AY : 2007-08 3 6. AGGRIEVED, THE ASSESSEE IS IN SECOND APPEAL. 7. THE LD. COUNSEL FOR THE ASSESSEE CONTENDS THAT : - I) DETAILED SUBMISSIONS WITH SUPPORTING EVIDENCE WE RE FILED BEFORE THE ASSESSING OFFICER WHEREIN IT WAS EXPLAINED THAT THE AFORESAID PAYMENT OF RS.5,28,000/- WERE MADE BY THE ASSESSEE FROM OUT OF SUBSTANTIAL CASH WITHDRAWALS MADE BY HIM AND HIS WI FE FROM BANK ACCOUNTS. COMPLETE DETAILS OF SUCH WITHDRAWALS SUPPORTED BY COPIES OF RELEVANT BANK ACCOUNTS WERE FILED BEFO RE THE ASSESSING OFFICER. IT WAS EXPLAINED THAT THE MAJOR HOUSEHOLD EXPENSES WERE INCURRED BY CHEQUES WHICH ARE SEPARAT ELY DEBITED IN THE BANK ACCOUNTS AND PART OF CASH WITHDRAWALS W ERE USED FOR SUNDRY REMAINING HOUSEHOLD EXPENSES WHICH WERE NOT MUCH. COMPLETE DETAILS WERE FILED AND IT WAS SUBMITTED TH AT THE ASSESSEE WAS LEFT WITH SUFFICIENT CASH AMOUNTS TO COVER THE ALLEGED PAYMENT OF RS.5,28,000/- AND, THEREFORE, THERE WAS NO JUSTIFICATION FOR ANY ADDITION. THE ASSESSING OFFICER COMPLETELY IGNORED THESE SUBMISSIONS AND HE HAS NOT COMMENTED ON THE MERITS OF THE EXPLANATION GIVEN BY THE ASSESSEE AND AT PARA-6 OF THE ASSESSMENT ORDER HE MERELY OBSERVED THAT 'THE ASSESSEE FAILED TO PROVE HIS CONTENTION'. THE ASSESSING OFFICER HAS NOT GIVEN AN Y REASONS AS TO HOW, IN HIS OPINION, THE ASSESSEE FAILED TO PROVE H IS CONTENTION, WHEREAS COMPLETE DETAILS SUPPORTED BY BANK STATEMEN TS WERE FILED BEFORE THE ASSESSING OFFICER. THE ADDITION OF RS.5,28,000/- WAS ARBITRARILY MADE BY THE ASSESSING OFFICER. II) THE CIT(A) ALSO HAS NOT DISPUTED THE FACT OF CA SH WITHDRAWALS FROM THE BANK ACCOUNTS NOR HAS HE DISPUTED THE TOTA L EXPENDITURE INCURRED BY THE ASSESSEE ON HOUSEHOLD EXPENSES. HO WEVER, THE ADDITION HAS BEEN SUSTAINED BY HIM MERELY ON PRESUM PTION THAT IT SMC-ITA NO. 3029/AHD/2013 SANDEEP PRAVINBHAI ENGINEER VS. DCIT AY : 2007-08 4 WAS NOT NORMAL FOR A PERSON TO MAKE WITHDRAWALS AND KEEP THE ACCUMULATION AMOUNT WITH HIM, TO BE ULTIMATELY USED FOR MAKING PAYMENTS AGAINST PURCHASE OF LAND. THUS, BOTH THE AUTHORITIES BELOW HAVE NOT CONSIDERE D THE DISCHARGE OF BURDEN BY THE ASSESSEE IN PROPER PERSP ECTIVE. THE LD. AO DID NOT CONSIDER THE EXPLANATION AT ALL AND THE LD. CIT(A) MERELY ON ASSUMPTIONS DISCARDED THE ASSESSEES VOLUMINOUS EVIDENCES, BANK ACCOUNTS, CASH FLOW STATEMENTS ETC. & WITHOUT CITIN G ANY COGENT REASON AND RELYING ONLY ON PRESUMPTIONS. SECTION 6 8/69 IMPOSES PRIMARY BURDEN ON THE ASSESSEE WHICH IS DULY STANDS DISCHARGED. IT IS SETTLED LAW THAT IF THE ASSESSEE GIVES AN EXPLANATI ON SUPPORTED BY DOCUMENTS, THE AUTHORITIES BELOW CAN REJECT OR DISM ISS THE SAME ON COGENT GROUNDS/EVIDENCE/MATERIAL ONLY. THERE IS NO JUSTIFICATION IN OFFERING NO COGENT COMMENT ON THE EVIDENCE FILED BY THE ASSESSEE AND MERELY RELYING ON PRESUMPTIONS ON THE BASIS OF SOME PETTY WITHDRAWALS OF RS.4000/- ON 07.07.2006 AND RS.4000/ - ON 11.08.2006 ETC. THUS, THE REASON OF NOT BELIEVING THE ASSESSE ES EXPLANATION IS WITHOUT ANY BASIS, JUSTIFICATION AND BRUSHING ASIDE THE RELEVANT EVIDENCE. SINCE THE ADDITION HAS BEEN CONFIRMED ON LY ON THE BASIS OF ASSUMPTIONS AND PRESUMPTIONS, THE SAME DESERVES TO BE DELETED. 8. THE LD. DEPARTMENTAL REPRESENTATIVE, ON THE OTHE R HAND, SUPPORTED THE ORDER OF THE CIT(A), PARTICULARLY PARAGRAPH 10 OF HIS ORDER. 9. I HAVE HEARD THE RIVAL CONTENTIONS, PERUSED THE MATERIAL AVAILABLE ON RECORD AND GONE THROUGH THE ORDERS OF THE AUTHORITI ES BELOW. AS THE FACTS EMERGE, IT HAS NOT BEEN DISPUTED THE FACT THAT THE ASSESSEE HAS FILED DETAILED EVIDENCE TO EXPLAIN THE SOURCE OF ABOVE AMOUNT AND DISCHARGED ITS PRIMARY ONUS IN TERMS OF SECTION 68/69 OF THE ACT. LD. ASS ESSING OFFICER DID NOT CONSIDER THE EVIDENCE & EXPLANATION AND CONFIRMED T HE ADDITION IN SMC-ITA NO. 3029/AHD/2013 SANDEEP PRAVINBHAI ENGINEER VS. DCIT AY : 2007-08 5 SUMMARILY MANNER. BEFORE THE LD. CIT(A), THE ASSES SEE FILED DETAILED PAPER- BOOK CONTAINING EXPLANATION, BANK ACCOUNTS DETAILS AND AGGREGATION OF AVAILABILITY OF CASH ETC. IT IS ALSO NOT DISPUTED T HAT THE MAJOR HOUSEHOLD EXPENSES WERE BORNE BY THE ASSESSEE BY SEPARATE ACC OUNT. IT IS SETTLED LAW THAT THE DISCHARGE OF PRIMARY ONUS BY THE ASSESSEE IS TO BE REBUTTED IN EFFECTIVE TERMS BY THE AUTHORITIES. THE EVIDENCE/E XPLANATION CANNOT BE DISBELIEVED ON PRESUMPTIONS AND ASSUMPTIONS. IN MY CONSIDERED VIEW, THE REASONS GIVEN BY THE LD. CIT(A) TO REBUT THE ASSESS EES EXPLANATION ARE BASED ON GUESSWORK AND PRESUMPTIONS AND THE CONFIRMATION OF ADDITION IS UNJUSTIFIED. SINCE THE ASSESSEE HAS DISCHARGED PRI MARY ONUS IN EFFECTIVE TERMS BY SUBMITTING THE PROPER/REASONABLE EXPLANATI ON ALONGWITH EVIDENCE AND ITS REBUTTAL BEING INEFFECTIVE AND BASED ONLY O N PRESUMPTIONS, THE ADDITION IN QUESTION STANDS DELETED. 10. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE COURT ON 22 ND NOVEMBER, 2016 AT AHMEDABAD. SD/- R.P. TOLANI (JUDICIAL MEMBER) AHMEDABAD; DATED 22/11/2016 *BIJU T., SR. PS / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. / CONCERNED CIT 4. ( ) / THE CIT(A) 5. , , / DR, ITAT, AHMEDABAD 6. / GUARD FILE . / BY ORDER, TRUE COPY / ( DY./ASSTT.REGISTRAR) , / ITAT, AHMEDABAD