The Income Tax Officer, Jammu V. Sh. Parvez Bakhat Malik, Jammu

ITA 304/ASR/2014

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 8932 (ITAT-AMRITSAR)
• Duration Of Justice: 1 year(s) 7 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 01-01-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2005-2006
• Appeal Filed On: 07-05-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: K V K SINGH
• Keywords: Assessment record; Onus to prove
• Section: 142(1); 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, AMRITSAR BENCH; AMRITSAR (CAMP : JAMMU) BEFORE SH. A.D. JAIN, JUDICIAL MEMBER AND T.S. KAPOOR, ACCOUNTANT MEMBER ITA NO.304(ASR)/2014 ASSESSMENT YEAR:2005-06 PAN:AXDPM1862F INCOME TAX OFFICER, VS. SH. PARVEZ BAKHAT MALIK, WARD-1(2), JAMMU. H/NO.70, BATHINDI MORH, SATELLITE COLONY, JAMMU. (APPELLANT) (RESPONDENT) APPELLANT BY:SH. K.V.K. SINGH, DR RESPONDENT BY:SH.JOGINDER SINGH, CA DATE OF HEARING: 02/12/2015 DATE OF PRONOUNCEMENT: 01/01/2016 ORDER PER A.D. JAIN, JM THIS IS THE DEPARTMENTS APPEAL FOR THE ASSESSMENT YEAR 2005-06, AGAINST THE ORDER DATED 26.02.104 PASSED BY THE LD. CIT(A), JAMMU. THE DEPARTMENT HAS RAISED THE FOLLOWING GROUNDS OF APPE AL: 1. ON THE FACTS AND CIRCUMSTANCES WHETHER THE LD. CIT(A) WAS RIGHT IN DELETING THE ADDITIONS MADE ON ACCOUNT OF UNEXPLAINED CASH DEPOSITS IN THE BANK AMOUNTING TO RS.5,00,000/- AS THE BANK ACCOUNT HAS BEEN OWNED BY THE WIFE OF THE ASSESSEE AND THIS FACT WAS ADMITTED BY THE ASSESSEE. 2. ON THE FACTS AND CIRCUMSTANCES WHETHER THE LD. C IT(A) WAS RIGHT IN DELETING THE ADDITIONS MADE ON ACCOUNT OF UNEXPLAINED CASH DEPOSITS IN THE BANK AMOUNTING TO RS.15,00,000/- AS THE CHEQUES WERE RECEIVED BY THE ASSESSEE FROM THE VENDEE AND THE VENDEE DENIED THE DELIVERY OF THE CHEQUES TO THE ASSESSEE. ITA NO.304(ASR)/2014 ASSTT. YEAR : 2005-06 2 3. ON THE FACTS AND CIRCUMSTANCES WHETHER THE LD. C IT(A) WAS RIGHT IN DELETING THE ADDITIONS MADE ON ACCOUNT OF UNEXPLAINED CASH DEPOSITS IN THE BANK AMOUNTING TO RS.4,15,000/-. 4. ON THE FACTS AND CIRCUMSTANCES WHETHER THE LD. C IT(A) WAS RIGHT IN DELETING THE ADDITIONS MADE ON ACCOUNT OF UNEXPLAINED CASH DEPOSITS IN THE BANK AMOUNTING TO RS.3,00,000/- AS KEEPING HUGE AMOUNT OF RS.3,00,000 /- IN CASH FOR A LONG PERIOD OF AROUND TWO YEARS IS NOT JUSTIFIABLE WHEN THE ASSESSEE IS MAINTAINING DIFFERENT BANK ACC OUNTS. 2. THE ASSESSEE INDIVIDUAL, DURING THE YEAR, DERIVE D PENSION AND OTHER INCOME. AS PER INFORMATION RECEIVED BY THE AO FROM THE ITO (AIU), JAMMU, WORKING UNDER THE DIRECTORATE OF INCOME TAX (INV.), DURING THE YEAR, THERE WERE HUGE CREDITS AGGREGATING TO RS. 58 ,77,539/- IN HIS BANK ACCOUNT MAINTAINED WITH HDFC BANK, BAHU PLAZA, JAMM U. THIS ACCOUNT WAS NUMBERED 2411000029956. THERE WAS ANOTHER BANK ACCOUNT NO. 02411000070472 WITH HDFC BANK, BAHU PLAZA, JAMMU, I N THE NAME OF SMT. PARVEEN MALIK, WIFE OF THE ASSESSEE. IN THE ST ATEMENT RECORDED ON 20.03.2006, THE ASSESSEE ADMITTED THAT HIS WIFE WAS A HOUSE-WIFE HAVING NO SOURCE OF INCOME AND THAT THUS, THE DEPOSITS MAD E IN HER ACCOUNT BELONGED TO THE ASSESSEE. THIS ACCOUNT HAD BEEN OPE NED ON 28.12.2004 AND CASH OF RS.5,00,000/- WAS DEPOSITED ON THE VERY SAME DATE, AS THE OPENING AMOUNT. 3. THE COMPLETED ASSESSMENT OF THE ASSESSEE WAS REO PENED AND THE ASSESSEE WAS QUERIED WITH REGARD TO THIS DEPOSIT VI DE NOTICE DATED 17.01.2013, ISSUED U/S 142(1) OF THE ACT. THE ASSES SEE CONTENDED IN HIS REPLY DATED 06.02.2013 THAT THE ISSUE OF DEPOSIT OF RS.5 LACS IN THE BANK ACCOUNT OF HIS WIFE DID NOT PERTAIN TO THE ASSESSE E, SINCE THE ACCOUNT BELONGED TO HIS WIFE. IT WAS SUBMITTED THAT THIS IS SUE WAS NOT RELEVANT TO THE PROCEEDINGS FOR THE YEAR UNDER CONSIDERATION, I .E., ASSESSMENT YEAR 2005-06. THE AO, HOWEVER, DID NOT FIND THE ASSESSEE S REPLY TO BE SATISFACTORY AND A SHOW CAUSE NOTICE DATED 07.02.20 13 WAS ISSUED. ITA NO.304(ASR)/2014 ASSTT. YEAR : 2005-06 3 THEREIN, THE AO STATED THAT IN THE COURSE OF ENQUIR Y PROCEEDINGS IN HIS STATEMENT RECORDED ON 20.03.2006, THE ASSESSEE HAD STATED THAT HIS WIFE WAS A HOUSE-WIFE, HAVING NO SOURCE OF INCOME. THE AO OBSERVED THAT AS SUCH, IT DID NOT MATTER IF THE ACCOUNT WAS A JOINT ACCOUNT OR A SINGLE ACCOUNT, AND THAT THEREFORE, THE ASSESSEES PLEA TH AT THE ACCOUNT BELONGED TO HIS WIFE WAS BEING REJECTED. IT WAS FUR THER OBSERVED THAT REGARDING THE SOURCE OF THE DEPOSIT OF RS.5 LACS IN THE BANK ACCOUNT OF HIS WIFE, IN HIS REPLY, THE ASSESSEE HAD SUPPLIED A LIST OF ONLY INCOMPLETE ADDRESSES AND NO PROOF OF THE IDENTITY OF THE PERS ONS AND THEIR CREDIT- WORTHINESS, OR GENUINENESS OF THE RECEIPTS OF SHAGA NS ON THE MARRIAGE OF THE ASSESSEES DAUGHTER HAD BEEN FILED BY THE ASSES SEE; THAT EVEN NO PROOF OF THE OCCASION HAD BEEN FURNISHED; THAT THE ASSESSEE HAD STATED THAT MOST OF THE PERSONS WHO HAD GIVEN SHAGANS HAD EXPIRED AND THAT THE ASSESSEE WAS UNABLE TO PRODUCE THE DEATH CERTIF ICATES OF THESE PERSONS; AND THAT THE ASSESSEE HAD ALSO EXPRESSED H IS INABILITY TO PRODUCE THE REMAINING PERSONS BEFORE THE AO TO VERI FY THE RECEIPT OF SHAGAN AMOUNT. THE AO OBSERVED THAT FROM THIS, IT S TOOD ESTABLISHED THAT THE CREDIT ENTRIES IN THIS ACCOUNT WERE FROM S OURCES NOT DISCLOSED TO THE DEPARTMENT. THE ASSESSEE WAS ASKED TO SHOW CAUS E AS TO WHY THIS AMOUNT OF RS. 5 LACS BE NOT ADDED TO THE ASSESSEES RETURNED INCOME. 4. AGAINST THE SAID SHOW CAUSE NOTICE, THE ASSESSEE SOUGHT DIRECTIONS U/S 144A OF THE ACT FROM THE JCIT, RANGE-I, JAMMU. 5. THE JCIT ISSUED THE FOLLOWING DIRECTIONS VIDE L ETTER DATED 21.03.2013 TO THE AO: THE CONTENTION OF THE COUNSEL OF THE ASSESSEE IS T HAT THE DEPOSITS OF RS.5,00,000/- IS IN THE NAME OF SMT. PARVEEN MALIK WHEREAS THE PROCEEDINGS ARE GOING ON IN THE CASE OF SH.PARVEZ BHAKHAT MALIK. IT IS, THEREFORE, ARGUED BY ASSESSEE AND HIS COUNSEL T HAT THIS AMOUNT CANNOT BE ADDED TO THE INCOME OF THE ASSESSEE. THE SAID ISSUE WAS DISCUSSED WITH THE COUNSEL OF THE ASSESSEE AND AFTE R GOING THROUGH THE ASSESSMENT RECORDS IT HAS BEEN OBSERVED THAT DU RING THE COURSE OF INQUIRY PROCEEDINGS THE HUSBAND OF THE ASSESSEE HAS ADMITTED ITA NO.304(ASR)/2014 ASSTT. YEAR : 2005-06 4 THAT HIS WIFE IS A HOUSE-WIFE AND HAS NO SOURCE OF INCOME. IT IS, THEREFORE, PRESUMED THAT THE DEPOSIT OF RS.5,00,000 /- IN BANK ACCOUNT NO.02411000070472 MAINTAINED IN THE NAME OF SMT. PARVEEN MALIK BELONGS TO SH. PARVEZ BHAKAT MALIK WH ICH THE ASSESSEE HAS DEPOSITED IN THE BANK ACCOUNT FROM THE SOURCES NOT DISCLOSED TO THE DEPARTMENT. THEREFORE, THE CONTENT ION OF THE COUNSEL OF THE ASSESSEE THAT THE SAME CANNOT BE ADDED TO TH E INCOME OF THE SH.PARVEZ BHAKAT MALIK IS NOT CORRECT. THE AO IS DI RECTED TO MAKE THE ADDITION IN HANDS OF THE ASSESSEE WHOSE PROCEED INGS ARE GOING ON AS THE ASSESSEE IS MAINTAINING BANK ACCOUNT IN T HE NAME OF HIS WIFE AND THE SOURCE OF THE DEPOSIT HAS NOT BEEN DIS CLOSED TO THE DEPARTMENT. SIMULTANEOUSLY, IT IS CLAIMED THAT THE SAID DEPOSIT OF RS.5,00,000/- IS OUT OF ALLEGED RECEIPT OF SHAGAN A MOUNT CLAIMED TO BE RECEIVED ON THE OCCASION OF MARRIAGE OF HIS DAUG HTER. THIS CONTENTION OF THE COUNSEL OF THE ASSESSEE IS NOT TE NABLE AS THE SHAGAN AMOUNTS ARE BIG AMOUNTS RANGING BETWEEN RS.2 0,000/- TO 50,000/- FROM VARIOUS PERSONS WHO AS PER LIST SUPPL IED HAS EXPIRED AND NOT AVAILABLE TO CONFIRM THE TRANSACTION. THUS, THE ASSESSEE HAS FAILED TO DISCHARGE HIS ONUS TO PROVE THAT THE CRED ITWORTHINESS OF THE PERSONS WHO HAS GIVEN SHAGANS, HENCE, THE AMOUNT NE EDS TO BE ADDED U/S 68 OF THE I.T. ACT, 1961 TO THE INCOME RE TURNED BY THE ASSESSEE AND PENALTY PROCEEDINGS U/S 271(1)(C) BE I NITIATED SEPARATELY. 6. THUS, U/S 144A OF THE ACT, THE JCIT DIRECTED THE AO TO MAKE THE ADDITION IN THE HANDS OF THE ASSESSEE, AS IT WAS TH E ASSESSEE WHO WAS MAINTAINING THE BANK ACCOUNT IN HIS WIFES NAME AND THE SOURCE OF THE DEPOSIT HAD NOT BEEN DISCLOSED. IT WAS ALSO OBSERVE D THAT THE AMOUNT NEEDED TO BE ADDED U/S 68 OF THE I.T.ACT, 1961, SIN CE THERE WAS NO FORCE IN THE ASSESSEES CONTENTION THAT THE DEPOSIT OF RS .5,00,000/- WAS OUT OF SHAGAN RECEIVED ON HIS DAUGHTERS MARRIAGE, SINCE T HE SHAGAN AMOUNTS WERE RANGING FROM RS.20,000/- TO RS.50,000/-, FROM VARIOUS PERSONS WHO, AS PER THE ASSESSEE, HAD EXPIRED AND WERE NOT AVAILABLE FOR CONFIRMATION, DUE TO WHICH, THE ASSESSEE HAD FAILED TO PROVE THEIR CREDITWORTHINESS. 7. THE AO, ACCORDINGLY, ADDED THE AMOUNT OF RS.5,00 ,000/- TO THE ASSESSEES RETURNED INCOME. 8. THE LD. CIT(A) DELETED THIS ADDITION, GIVING RI SE TO GROUND NO.1 BEFORE US. ITA NO.304(ASR)/2014 ASSTT. YEAR : 2005-06 5 9. THE LD. DR CONTENDED THAT THE LD. CIT(A) HAS ERR ED IN DELETING THE ADDITION MADE ON ACCOUNT OF UNEXPLAINED CASH DEPOSI T IN THE BANK ACCOUNT OF THE ASSESSEES WIFE, AMOUNTING TO RS.5,0 0,000/-, SINCE THE ASSESSEE HIMSELF HAD ADMITTED THAT THE DEPOSIT I N THE BANK ACCOUNT WAS OF THE ASSESSEES WIFE AND THAT IT DID NOT PERT AIN TO HIM; AND THAT THE ACCOUNT WAS OWNED BY HIS WIFE. 10. ON THE OTHER HAND, THE LD. COUNSEL FOR THE ASSE SSEE HAS PLACED STRONG RELIANCE ON THE IMPUGNED ORDER, CONTENDING T HAT HIS DAUGHTERS, WHO WERE SETTLED IN AMERICA, REGULARLY SENT MONEY TO THEIR MOTHER; THAT HIS WIFE ALSO RECEIVED MONEY FROM HER FATHER, WHO W AS THE OWNER OF FRUIT ORCHARDS IN KASHHMIR; THAT THE AO, DESPITE REPEATED REQUESTS FROM THE ASSESSEE, DID NOT MAKE ANY REQUIREMENT WHATSOEVER F ROM THE WIFE OF THE ASSESSEE THOUGH THE BANK ACCOUNT ADMITTEDLY BELONG TO HER; AND THAT THERE WAS NOTHING TO PROVE THAT THE AMOUNT OF RS.5, 00,000/- ACTUALLY BELONGED TO THE ASSESSEE. 11. HERE, IT IS SEEN THAT THE DEPARTMENT HAS NOT BE EN ABLE TO DISLODGE THE CATEGORICAL FINDING OF THE LD. CIT(A) TO THE EF FECT THAT THERE WAS NOTHING TO RECORD TO SHOW THAT THE AMOUNT OF RS.5,0 0,000/- DEPOSITED IN THE ACCOUNT SMT. PARVEEN MALIK, WIFE OF THE ASSESSE E WAS, IN FACT, CASH BELONGING TO THE ASSESSEE. THE AO MADE THE ADDITION ONLY ON THE BASIS OF THE PRESUMPTION THAT THE BANK ACCOUNT, MAINTAINED I N THE NAME OF HIS WIFE ACTUALLY BELONGED TO THE ASSESSEE. THE AO DID NOT DEEM IT APPROPRIATE TO MAKE ANY ENQUIRY FROM SMT. PARVEEN M ALIK, DESPITE THE FACT THAT THE ASSESSEE HAD MADE REPEATED REQUESTS I N THIS REGARD. AS SUCH, FINDING NO ERROR WITH THE ACTION OF THE LD. C IT(A) IN DELETING THE ADDITION MADE, WE REJECT GROUND NO.1. 12. CONCERNING GROUND NO.2, CHEQUES OF RS.4 LACS, RS. 4 LACS, RS. 4 LACS AND RS. 3 LACS, DATED 21.12.2004, TOTAL AMOUNT ING TO RS.15 LACS, WERE FOUND CREDITED IN THE ASSESSEES ACCOUNT, REPR ESENTING CHEQUE PAYMENTS FROM SH. PARMOD KUMAR CONTRACTOR. ON QUERY , THE ASSESSEE ITA NO.304(ASR)/2014 ASSTT. YEAR : 2005-06 6 SUBMITTED THAT THE CHEQUES WERE HANDED OVER BY SH. PREM NATH, A CLOSE FRIEND OF SH. PARDEEP KUMAR CONTRACTOR. THE AO, IN THE SHOW CAUSE NOTICE OBSERVED THAT NO DOCUMENTARY EVIDENCE HAD BE EN FILED REGARDING THE NATURE AND SOURCE OF THESE DEPOSITS, NOR ANY CO NFIRMATION HAD BEEN FILED. 13. IN THE DIRECTIONS U/S 144A OF THE ACT, IT WAS O BSERVED THAT VIDE OFFICE LETTER DATED 11.03.2013, SH. PREM NATH (VEND EE) HAD BEEN CONFRONTED WITH THE ASSESSEES REPLY THAT HE HAD MA DE CHEQUE PAYMENT OF 15 LACS THROUGH THE ACCOUNT OF SH. PARDEEP KUMA R CONTRACTOR, A RELATIVE OF THE ASSESSEE. VIDE HIS REPLY, SH. PREM NATH STATED THAT SH. PARDEEP KUMAR CONTRACTOR WAS NOT ANY RELATIVE OF TH E ASSESSEE AND THAT THE ASSESSEE HAD NO KNOWLEDGE OF SUCH CHEQUES. IT W AS OBSERVED THAT THE ASSESSEE HAD NOT BROUGHT ANY EVIDENCE TO PROVE THE CREDIT-WORTHINESS OF THE DEPOSITOR AND SO, THE AMOUNT WAS NEEDED TO BE A DDED U/S 68 OF THE ACT. THE AO MADE THE ADDITION OF RS.15 LACS. 14. THE LD. CIT(A), DELETED THE ADDITION SO MADE BY THE AO. 15. THE LD. DR HAS CONTENDED THAT THE LD. CIT(A) HA S ERRED IN DELETING THE ADDITION CORRECTLY MADE BY THE AO SINCE THE CHE QUES WERE STATED TO HAVE BEEN RECEIVED BY THE ASSESSEE FROM THE VENDEE, WHEREAS THE VENDEE DENIED THE DELIVERY OF THE CHEQUES TO THE ASSESSEE . 16. THE LD. COUNSEL FOR THE ASSESSEE, ON THE OTHER HAND, STRONGLY RELIED ON THE IMPUGNED ORDER. 17. THE LD. CIT(A) HAS DELETED THE ADDITION BY OBSE RVING AS FOLLOWS: ADDITION OF RS.15,00,000/- WAS MADE BY THE AO ON ACCOUNT OF AMOUNT CREDITED IN HIS BANKS THROUGH FOUR CHEQUES. THE APPELLANT HAS ARGUED THAT HE HAS RECEIVED FOUR THIRD PARTY CH EQUES FROM SH.PREM NATH AMOUNTING TO RS.15 LAKHS AS PART CONSI DERATION FOR SALE OF PROPERTY. THE APPELLANT WAS PRODUCED COPY O F AGREEMENT, CONFIRMATION OF SH. PARDEEP MALHOTRA, BANK STATEME NTS AND A LETTER OF THE COUNSEL OF SH. PREM NATH GIVEN TO ADIT (INV. ), JAMMU IN INVESTIGATION PROCEEDINGS. THE MATTER WAS REMANDED BACK TO THE AO FOR VERIFICATION AND COMMENTS THEREON. I HAVE GO NE THROUGH THE SUBMISSION OF THE APPELLANT, ASSESSMENT ORDER AND R EMAND REPORT. IT IS NOTICED THAT SH. PARDEEP MALHOTRA HAS CONFIRMED DURING THE ITA NO.304(ASR)/2014 ASSTT. YEAR : 2005-06 7 REMAND PROCEEDINGS THAT SH. PREM NATH HAD MADE PAYM ENTS OF RS.15 LAKHS IN THE FORM OF TWO DRAFTS OF RS. 9 LAKH S ( DATED 18.11.2004 FROM J & K BANK UNIVERSITY CAMPUS) AND R S.6 LAKHS( DATED 17.11.2004 FORM ALLAHABAD BANK, RESIDENCY ROA D) TO M/S. SUNDER PAL ENGINEERS, MANDI GOBINDGARH, ON HIS BEHA LF AND TO REPAY THE SAID AMOUNT HE HAD PAID FOUR UNNAMED CHEQ UES OF RS.15 LAKHS WHICH SH.PREM NATH FURTHER HANDED OVER TO THE APPELLANT. HOWEVER, SH. PREM NATH DURING THE REMAND PROCEEDING S ALTHOUGH CONFIRMED THAT HE HAD MADE PAYMENTS TO SUNDER PAL E NGINEERS BUT SUBMITTED THAT HE HAD MADE THOSE PAYMENT ON BEHALF OF HIS BROTHER RAJKUMAR AND NOT FOR SH. PARDEEP MALHOTRA AND THAT HE HAS NOT HANDED OVER ANY CHEQUES OF PARDEEP KUMAR TO THE APP ELLANT. ON THE PERUSAL OF DOCUMENT ON RECORD, IT IS FOUND THAT THE STATEMENT MADE BY SH. PREM NATH IS UNTRUE AS IN THE LETTER SUBMITT ED BEFORE THE ADIT (INV.) DURING INVESTIGATION PROCEEDINGS, SH. PREM NATH HAS HIMSELF ADMITTED THAT HE HAS MADE PAYMENTS OF RS.15 LAKHS T O SUNDER PAL ENGINEERS ON BEHALF OF SH. PARDEEP MALHOTRA. THE ST ATEMENT MADE BY SH. PREM NATH IS IN CONTRADICTION OF HIS OWN SUB MISSION AND ACCORDINGLY NOT ACCEPTABLE. FROM THE DOCUMENTS ON R ECORD, IT IS CLEAR THAT THE FOUR CHEQUES TOTALING RS.15 LAKH HAS BEEN GIVEN BY SH. PARDEEP MALHOTRA TO SH. PREM NATH AGAINST THE AMOUN T PAID BY SH. PREM NATH ON BEHALF BEHALF TO M/S. SUNDER PAL ENGIN EERS. THESE CHEQUES WERE HANDED OVER BY SH. PREM NATH TO THE AP PELLANT IN PART CONSIDERATION OF PURCHASE OF PROPERTY VIDE SUPPLEME NTARY AGREEMENT TO SELL DATED 29.07.2004. THEREFORE, THE AMOUNT OF RS. 15 LAKHS IS EXPLAINED BY THE APPELLANT AND ACCORDINGLY THIS GROUND OF APPEAL IS ALLOWED. FURTHER, IT IS NOTICED THAT THE SELLER I.E. THE APPELLANT HAS PRODUCED SUPPLEMENTARY AGREEMENT TO S ELL OF RS. 57 LAKHS AND DISCLOSED THE SALE CONSIDERATION OF RS.57 LAKHS IN HIS RETURN, WHEREAS THE PURCHASER I.E. SH. PREM NATH IS DENYING THE PAYMENT OF RS.15 LAKHS TO THE APPELLANT WHICH HE HA S MADE THROUGH THE CHEQUES OF SH. PARDEEP MALHOTRA WHICH ARE ALSO CONFIRMED BY SH. PARDEEP MALHOTRA. IT CLEARLY SHOWS THAT SH. PRE M NATH HAS NOT DISCLOSED THE FULL AMOUNT OF PURCHASE CONSIDERATION IN THE RETURN AND MADE PAYMENTS OF RS. 15 LAKHS OUTSIDE HIS BOOK S. IT IS, THEREFORE, DIRECTED TO PASS THE INFORMATION TO THE AO OF SH. PREM NATH FOR NECESSARY ACTION. 18. THE DEPARTMENT HAS NOT BEEN ABLE TO CONTROVERT THE CATEGORICAL FINDINGS OF THE LD. CIT(A). THE LD. CIT(A) HAS TAKE N INTO CONSIDERATION THE ASSESSEES CONTENTION THAT HE HAD RECEIVED THE CHEQ UES, TOTAL AMOUNTING TO RS.15 LAKHS, FROM SH. PREM NATH, AS PART CONSIDE RATION OF SALE OF PROPERTY IN THE INVESTIGATION PROCEEDINGS BEFORE TH E ADIT (INV.). A LETTER ITA NO.304(ASR)/2014 ASSTT. YEAR : 2005-06 8 HAD BEEN GIVEN BY THE COUNSEL OF SH. PREM NATH. TH E SAME WAS PRODUCED BY THE ASSESSEE ALONGWITH COPY OF AGREEMEN T, CONFIRMATION OF THE CONTRACTOR, SH. PARDEEP KUMAR MALHOTRA AND THE BANK STATEMENT. THE LD. CIT(A) REMITTED THE MATTER TO THE AO. THE A O DULY FILED A REMAND REPORT. AS PER THE REMAND REPORT, IN THE REMAND PRO CEEDINGS BEFORE THE AO, SH. PARDEEP KUMAR MALHOTRA HAD CONFIRMED SH. PRAM NATH HAVING MADE THE PAYMENT OF RS. 15 LAKHS TO THE ASSESSEE BY WAY OF TWO DRAFTS OF RS.9 LACS AND RS. 6 LAKHS TO M/S. SUNDER PAL ENGINE ERS, ON HIS BEHALF. THE FIRST DRAFT DATED 18.11.2004 WAS FROM J & K BA NK, UNIVERSITY CAMPUS, JAMMU WHEREAS, THE OTHER WAS FROM ALLAHABAD BANK, RESIDENCY ROAD, JAMMU AND WAS DATED 17.11.2004. TO REPAY THIS AMOUNT, HE STATED TO HAVE ISSUED FOUR CHEQUES, TOTA L AMOUNTING TO RS.15 LAKHS. IT WAS THESE CHEQUES, WHICH SH. PREM NATH HA D HANDED OVER TO THE ASSESSEE. NOW, WHEN SH. PREM NATH HAD ADMITTED, DURING THE INVESTIGATION PROCEEDINGS, HAVING MADE THE PAYMENT S TO M/S. SUNDER PAL ENGINEERS, MANDI GOBINDGARH, ON BEHALF OF SH. P ARDEEP MALHOTRA/SH. PREM NATH, HIS STATEMENT IN THE REMAND PROCEEDINGS, THAT THE PAYMENTS WERE ON BEHALF OF HIS BROTHER SH.RAJ K UMAR AND NOT FOR SH. PARDEEP MALHOTRA AND THAT HE HAD NOT HANDED OVER AN Y CHEQUE OF SH. PARDEEP KUMAR TO THE ASSESSEE, WAS RIGHTLY OBSERV ED BY THE LD. CIT(A), PARTICULARLY WHEN THE PAYMENT WAS CONFIRMED BY THE DEPOSITOR SH. PARDEEP MALHOTRA HIMSELF, TO BE UNTRUE. MOREOVER, I T WAS FOUND FROM THE DOCUMENTS ON RECORD THAT THE FOUR CHEQUES TOTALING TO RS.15 LAKHS HAD BEEN GIVEN BY SH. PARDEEP MALHOTRA TO SH. PREM NATH AGAINST THE AMOUNT PAID BY SH. PREM NATH ON HIS BEHALF TO M/S. SUNDER PAL ENGINEERS. THE CHEQUES WERE IN PART CONSIDERATION O F PURCHASE OF PROPERTY VIDE SUPPLEMENTARY AGREEMENT TO SELL DATED 29.07.2004, WHICH WAS ALSO PRODUCED ON RECORD. THE ASSESSEE HAD PROD UCED SUPPLEMENTARY AGREEMENT TO SELL, WHEREIN THE SALE C ONSIDERATION WAS RECITED TO BE AT RS. 57 LAKHS. THIS AMOUNT OF RS. 57 LAKHS STOOD DISCLOSED BY THE ASSESSEE IN HIS RETURN OF INCOME. IT WAS ON CONSIDERATION ITA NO.304(ASR)/2014 ASSTT. YEAR : 2005-06 9 OF ALL THESE FACTORS, WHICH REMAIN UNCHALLENGED BY THE DEPARTMENT THAT THE LD. CIT(A) DELETED AND, IN OUR CONSIDERATION O PINION, RIGHTLY SO, THE ADDITION OF RS.15 LAKHS. MOREOVER, THE AO OF SH. P REM NATH HAD BEEN SOUGHT TO BE INFORMED IN THIS REGARD BY THE LD. CIT (A), SO THAT THE AMOUNT DOES NOT REMAIN UNTAXED. 19. IN VIEW OF THE ABOVE DISCUSSION, GROUND NO.2 IS ALSO FOUND TO BE SHORN OF MERIT AND IT IS REJECTED. 20. COMING TO GROUND NO.3, APROPOS CREDIT ENTRY OF RS.5.15 LAKHS, THE ASSESSEE SUBMITTED IN HIS REPLY TO THE AO, THAT HE WAS A PARTNER IN THE FIRM M/S. JAVED IQBAL WANI CONTRACTOR AND THAT THE AMOUNT HAD BEEN RECEIVED BACK, AFTER RETIREMENT FROM THE SAID FIRM. THE ASSESSEE FURNISHED A COPY OF ACKNOWLEDGEMENT OF THE RETURN F ILED BY THE FIRM FOR THE YEAR UNDER CONSIDERATION, COPY OF COMPUTATION O F INCOME, BALANCE SHEET AND CAPITAL ACCOUNT OF THE PARTNER AND COPY O F PARTNERSHIP DEED. THE AO OBSERVED THAT AS PER THE CAPITAL ACCOUNT, TH E ASSESSEE HAD NOT RETIRED DURING THE PERIOD UNDER CONSIDERATION, BU T HAD BECOME A PARTNER IN THE FIRM AND HAD INTRODUCED CAPITAL OF R S.1,65,000/- DURING THE YEAR AND THERE WAS A WITHDRAWAL OF RS.45,810/- ONLY. AS PER THE AO, HENCE, THE CREDIT ENTRIES IN THE BANK ACCOUNT, AMOU NTING TO RS.5.15 LAKHS, CLAIMED BY THE ASSESSEE AS RECEIVED FROM M/S . JAVED IQBAL WANI CONTRACTOR, WERE FROM UNDISCLOSED SOURCES. THE ASSE SSEE WAS ASKED TO SHOW CAUSE WHY THE AMOUNT BE NOT ADDED TO HIS RETUR N INCOME. 21. IN THE DIRECTIONS ISSUED U/S 144A OF THE ACT, T HE AO WAS DIRECTED TO ADD THE AMOUNT TO THE ASSESSEES RETURNED INCOME , SINCE THE ASSESSEES REPLY BEFORE THE AO WAS NOT FOUND CONVI NCING DUE TO THE FACT THAT AS PER THE CAPITAL ACCOUNT, THERE WERE NOT SUC H WITHDRAWALS AND AS SUCH, THE DEPOSITS WERE TREATED AS MADE BY THE ASSE SSEE FROM UNDISCLOSED SOURCES. THE AO ADDED THE AMOUNT AND TH E LD. CIT(A) DELETED THE ADDITION. 22. THE DEPARTMENT CONTENDS THAT THE LD. CIT(A) HAS WRONGLY DELETED THE ADDITION SINCE THE CHEQUES WERE STATED BY THE A SSESSEE TO BE RECEIVED ITA NO.304(ASR)/2014 ASSTT. YEAR : 2005-06 10 FROM THE VENDEE WHEREAS THE VENDEE DENIED THE DELIV ERY OF THE CHEQUES TO THE ASSESSEE. 23. THE LD. COUNSEL FOR THE ASSESSEE, ON THE OTHER HAND, STRONGLY RELIED UPON THE IMPUGNED ORDER. 24. THE LD. CIT(A), IT IS SEEN, DELETED THE ADDITIO N ON THE BASIS THAT IN THE REMAND PROCEEDINGS BEFORE THE AO, THE AO HAD VE RIFIED THAT ONE CHEQUE OF RS. 1 LAKH HAD BEEN DISHONOURED BY THE BA NK, WITH REGARD TO WHICH, THE ASSESSEES PLEA WAS ACCEPTED; THAT, HOWE VER, THE AO HAD NOT MADE ANY INQUIRY FROM M/S. JAVED IQBAL WANI; AND TH AT THE BANK SHEET PRODUCED BY THE ASSESSEE SHOWING THE SOURCE OF PURC HASES HAD NOT BEEN VERIFIED BY THE AO BUT STILL, IT HAD BEEN CONCLUDED THAT SINCE THE ASSESSEE HAD PENSION OF RS.5000 AND DID NOT HAVE ANY SOURCE FOR MAKING PURCHASES ON BEHALF OF M/S. JAVED IQBAL WANI, FOR WHICH, REIMBURSEMENT HAD BEEN CLAIMED AS MADE, THE ASSESSEES CONTENTION WAS NOT BELIEVABLE. THE LD. CIT(A), FOUND THAT AS PER THE RECORD, THE A SSESSEE HAD RECEIVED CHEQUES OF RS. 4.15 LACS AND NOT OF RS.5.15 LACS FR OM MR. JAVED IQBAL WANI, AS REIMBURSEMENT FOR PURCHASES MADE ON BEHALF OF THE FIRM IN WHICH THE ASSESSEE WAS ALSO A PARTNER. THE FIRM HA D ALSO CONFIRMED THIS FACT IN THE FIRM LEDGER, COPY OF WHICH WAS CERTIFIE D BY THE MANAGING PARTNER OF THE FIRM. ON REMAND, HOWEVER, THE AO DI D NOT MAKE ANY ENQUIRY IN THIS REGARD. THEREFORE, IN VIEW OF THE LEDGER COPY OF THE FIRM, AS CERTIFIED BY ITS MANAGING DIRECTOR, THE LD. CIT( A) WAS CORRECT IN DULY TAKING INTO CONSIDERATION THIS DOCUMENT. THE COPY OF THE BANK ACCOUNT, FROM WHICH WITHDRAWALS WERE MADE FOR MAKING PURCHA SES FROM TIME, TO TIME AS PRODUCED BY THE ASSESSEE, WAS ALSO NOT DISP UTED. 25. IN VIEW OF THE ABOVE, GROUND NO.3 IS REJECTED. 26. GROUND NO.4 PERTAINS TO CHALLENGING THE ACTION OF THE LD. CIT(A) IN DELETING THE ADDITION OF RS.3 LACS, MADE ON ACCOUNT OF UNEXPLAINED CASH. ITA NO.304(ASR)/2014 ASSTT. YEAR : 2005-06 11 27. THE AO MADE THE ADDITION ON THE BASIS OF THE DI RECTIONS UNDER SECTION 144A OF THE ACT. AS PER THE RECORD, A DEPO SIT OF RS.3 LACS STOOD MADE ON 09.07.2004. THE ASSESSEE HAD MAINTAINED TH AT THE SAID AMOUNT WAS DEPOSITED IN THE JOINT ACCOUNT FROM THE RETIREMENT BENEFITS RECEIVED AND THAT THIS WAS SUPPORTED BY THE PHOTOCO PIES OF CALCULATION SHEET/WORKING SHEET OF THE RETIREMENT BENEFITS. IT WAS OBSERVED THAT AS PER THIS DOCUMENT, THE ASSESSEE HAD RETIRED ON 31. 07.2001, WHEREAS THE AMOUNT WAS DEPOSITED ON 09.07.2004, AFTER A LONG GA P OF THREE YEARS. IT WAS OBSERVED THAT THE ASSESSEE HAD MADE OVER-WRITIN G/CUTTING ON THE DATE/YEAR UNDER THE INITIALS OF THE AUTHORITIES, DA TED 14.08.2003, AND THUS, THERE WAS SOME MANIPULATION OF THE DOCUMENTS, RENDERING THEM UNRELIABLE. 28. THE LD. CIT(A) CONSIDERED THE ARGUMENTS THAT TH OUGH HE RETIRED IN 2001 AND HAD RECEIVED GRATUITY AND COMMUTED PENSION IN THE SAID YEAR, THE GPF OF RS.2.83 LACS HAD BEEN RECEIVED IN FEBRU ARY, 2002, REGARDING WHICH THE ASSESSEE HAD PRODUCED A CERTIFICATE FROM THE DFO, BESIDES CALCULATION SHEET PRODUCED DURING THE ASSESSMENT, W HICH SHEET DID NOT HAVE ANY CUTTING. ON REMAND, NO VERIFICATION WAS DO NE BY THE AO AND THE ADDITION WAS MADE AGAIN. 29. IN THIS REGARD, IT IS SEEN THAT THERE IS NOTHIN G ON RECORD TO DISPUTE THE RECEIPT OF GRATUITY AND COMMUTED PENSION BY THE ASSESSEE IN OCTOBER, 2002. IT WAS THIS AND OTHER SAVINGS OF RS. 17,000/- WHICH THE ASSESSEE DEPOSITED IN THE BANK IN JULY, 2004. THE A O DID NOT BRING ANYTHING ON RECORD THAT THIS AMOUNT HAD IN FACT BEE N UTILIZED BY THE ASSESSEE FOR ANY OTHER PURPOSE. THERE IS NO FORCE I N THE AOS OBSERVATION THAT THERE WAS A LONG GAP BETWEEN THE RECEIPT AND T HE DEPOSIT. WE FIND THE ORDER OF THE LD. CIT(A) TO BE WELL VERSED IN THIS REGARD ALSO, SINCE THE AO REJECTED THE DOCUMENTARY EVIDENCE PRODUCED BY TH E ASSESSEE WITHOUT ITA NO.304(ASR)/2014 ASSTT. YEAR : 2005-06 12 BRINGING ANY MATERIAL TO CONTRADICT THE SAME. ACCOR DINGLY, GROUND NO.4 IS REJECTED. 30. IN THE RESULT, THE APPEAL IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 01/01/201 6. SD/- SD/- (T.S. KAPOOR) (A.D. JAIN) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 01/01/2016 /SKR/ COPY OF ORDER FORWARDED TO: 1. THE ASSESSEE:SH. PARVEZ BAKHAT MALIK, JAMMU 2. THE ITO, WARD 1(2), JAMMU 3. THE CIT(A), JAMMU 4. THE CIT, JAMMU 5. THE SR. DR, ITAT, ASR. TRUE COPY BY ORDER (ASSISTANT REGISTRAR) INCOME TAX APPELLATE TRIBUNAL