The Income-tax Officer, Kapurthala-II V. Sh. Varinder Kumar Sood, Kapurthala

ITA 305/ASR/2013

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 73255 (ITAT-AMRITSAR)
• Duration Of Justice: 9 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-02-2014
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 12-02-2014
• Assessment Year: 2009-2010
• Appeal Filed On: 08-05-2013
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: J S BHASIN
• Keywords: Additional evidence; Assessment record
• Section: 133(6); 69

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH; AMRITSAR. BEFORE SH. H.S. SIDHU, JUDICIAL MEMBER AND SH. B.P.JAIN, ACCOUNTANT MEMBER I.T.A. NO.302(ASR)/2013 ASSESSMENT YEAR:2009-10 PAN :ABQPS0771B SH. VARINDER KUMAR SOOD, VS. INCOME TAX OFFICER, S/O SH. ATAM DEV SUD, KAPURTHALA-II, THE MALL, KAPURTHALA. KAPURTHALA. (APPELLANT) (RESPONDENT) I.T.A. NO.305(ASR)/2013 ASSESSMENT YEAR:2009-10 PAN : ABQPS0771B INCOME TAX OFFICER, VS. SH. VARINDER KUMAR SOOD, KAPURTHALA-II, S/O SH. ATAM DEV SUD, KAPURTHALA. THE MALL, KAPURTHALA. (APPELLANT) (RESPONDENT) ASSESSEE BY: SH.J.S.BHASIN, ADVOCATE RESPONDENT BY:SH. MAHAVIR SINGH, DR DATE OF HEARING:12/02/2014 DATE OF PRONOUNCEMENT:24/02/2014 ORDER PER BENCH ; 2 THESE CROSS APPEALS OF THE ASSESSEE AND THE REVEN UE ARISE FROM THE ORDER OF THE CIT(A), JALANDHAR DATED 28.02.2013 F OR THE ASSESSMENT YEAR 2009-10.THE ASSESSEE HAS RAISED FOLLOWING GROUNDS O F APPEAL: 1. THAT THE LD. CIT(A), GROSSLY MISCONSTRUED THE F ACTS AND EVIDENCE ON RECORD TO HOLD THAT THE JOINT BANK ACCO UNT HELD WITH AXIS BANK, ENTIRELY BELONGED TO THE APPELLANT. 2. THAT IN THE FACTS OF THE CASE, THE LD. CIT(A) HA S ERRED IN PRINCIPALLY CONFIRMING THE ADDITION OF RS.7,00,000/ - BEING INVESTMENT IN FDR OF SH. LAKHBIR SINGH, BY WRONGLY DISBELIEVING THE EXPLANATION AND EVIDENCE BROUGHT O N RECORD. 3. THAT THE LD. CIT(A) WAS NOT JUSTIFIED IN REJECTI NG THE ASSESSEES EXPLANATION SUPPORTED BY COGENT EVIDENCE, TO EXPLAI N CASH DEPOSIT OF RS.6,40,000/- IN BANK. 4. THAT THE LD. CIT(A) ERRED IN NOT ALLOWING IN FU LL, THE ALTERNATIVE RELIEF OF TELESCOPING OF RS.7,00,000/- AND IN RESTR ICTING IT TO RS.6,40,000/- WHEN THE ENTIRE CASH DEPOSITS OF RS.1 8.38 LACS WERE ADDED AS UNEXPLAINED. 5. THAT THE LD. CIT(A) WAS NOT JUSTIFIED IN UPHOLDI NG THE ADDITION OF BALANCE AMOUNT OF RS.3,23,000/- (BEING PART OF RS.18,38,000/- ) BY WRONGLY IGNORING ASSESSES EXPL ANATION THAT IT WAS ALSO OUT OF PRIOR WITHDRAWALS MADE FROM BANK . 6. THAT THE ADDITION OF RS.21,218/- MADE TOWARDS UNDIS CLOSED BANK INTEREST, HAS BEEN WRONGLY CONFIRMED BY THE LD. CIT (A). 2. THE REVENUE IN ITS APPEAL HAS RAISED FOLLOWING G ROUNDS: ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW THE LD. CIT(A) HAS ERRED IN: 1. DELETING THE ADDITION OF RS.8,75,000/- MADE U/S 69A OF THE INCOME TAX ACT, 1961 AFTER ADMITTING WRITTEN SUBMIS SION AND ADDITIONAL EVIDENCES PRODUCED BY THE ASSESSEE WITHO UT 3 APPRECIATING THE FACT THAT THE ASSESSEE FAILED TO EXPLAIN THE SOURCES AND EVIDENCES OF THE CASH CREDITS BEFORE FI NALIZATION OF THE ASSESSMENT PROCEEDINGS. 2. NOT PASSING AN ORDER IN WRITING AND THEREFORE, N O COMPLYING WITH THE SUB-RULE (2) OF RULE 46A WHILE ADMITTING T HE ADDITIONAL EVIDENCE IGNORING THE DECISION OF THE ITAT, CHANDIG ARH BENCH, CHANDIGARH INN THE CASE OF SMT. SURINDER KAUR DATED 29.07.2011 PASSED IN ITA NO.596/CHD/2011. 3. IT IS PRAYED THAT THE ORDER OF THE LD. CIT(A) BE SET ASIDE AND THE A.O BE RESTORED. 4. THE APPELLANT REQUESTS FOR LEAVE TO ADD OR AMEND OR ALTER THE GROUNDS OF APPEAL BEFORE THE APPEAL IS HEARD AND DI SPOSED OFF. 3. THE BRIEF FACTS OF THE CASE AS EMANATING FROM TH E ASSESSMENT ORDER ARE REPRODUCED FOR THE SAKE OF CONVENIENCE AS UNDER: THE ASSESSEE IS A DOCTOR RUNNING A HOSPITAL UNDER THE NAME AND STYLE OF SOOD HOSPITAL, KAPURTHALA. HE DERIVES INCOME FRO M HOUSE PROPERTY, SALARY AND INTEREST. 3. ADDITION ON ACCOUNT OF UNEXPLAINED CASH DEPOSIT S U/S 69A OF THE I.T. ACT. AS PER AIR INFORMATION AVAILABLE WITH THIS OFFICE, THE ASSESSEE HAS DEPOSITED RS.18,38,000/- IN CASH IN HIS BANK AC COUNT NO.088010100098564 WITH AXIS BANK, KAPURTHALA JOINT LY HELD BY HIM WITH ONE SH. LAKHBIR SINGH S/O SH. TARA SINGH, VPO FATHU DHINGA. THOUGH THE MAIN HOLDER OF THIS BANK ACCOUNT IS SH. LAKHBIR SINGH, PERMANENT ACCOUNT NUMBER GIVEN FOR OPENING THIS BAN K ACCOUNT HAS BEEN GIVEN BY THE ASSESSEE. ACCORDINGLY, INFORMATIO N WAS REQUISITIONED FROM AXIS BANK, KAPURTHALA WITH RESPE CT TO ALL THE BANK ACCOUNTS HELD BY THE ASSESSEE U/S 133(6) VIDE THIS OFFICE LETTER NO.502 DATED 15.6.2011. IN RESPONSE THERETO THE BANK FURNI SHED COPIES OF ALL THE BANK ACCOUNTS SINGLY OR JOINTLY HELD BY HIM VID E THIS OFFICE LETTER DATED 17.6.2011. 3.1. THEREUPON, VIDE THIS OFFICE LETTER NO.541 DATE D 24.6.2011 THE ASSESSEE WAS ASKED TO FURNISH DOCUMENTARY EVIDENCE OF THE SOURCE OF 4 CASH DEPOSITS OF RS.18,38,000/- DURING F.Y. 2008-09 AND EXPLAIN WHY INTEREST OF RS.9161/- EARNED DURING F.Y. 2008-09 IN HIS JOINT ACCOUNT NO. 088013294 WITH HIS WIFE; BANK INTEREST OF RS.28 96/- EARNED ON HIS FDR FOR RS.7 LAKH PURCHASED ON 16.3.2009 IN JOINT N AME WITH SH LAKHBIR SINGH S/O SH. TARA SINGH AND BANK INTEREST OF RS.9161/- IN HIS TERM DEPOSIT ACCOUNT NO.088010400089803 WITH AX IS BANK, KAPURTHALA, WHICH WAS NOT SHOWN IN HIS RETURN OF IN COME BE NOT ADDED TO HIS ASSESSABLE INCOME. APART FROM THE OPPORTUNITY ALLOWED VIDE THIS OFFICE LETTER NO.541 DATED 24.6.2011, FOLLOWING OPPORTUNITIES WERE ALSO ALLOWED TO THE ASSESSEE TO EXPLAIN THE SOURCE OF CASH DEPOSITS AND NON DISCLOSURE OF INTEREST INCOME: 1. LETTER NO.3124 DATED 3.2.2011 2. LETTER NO.83 DATED 18.4.2011 3. LETTER NO.572 DATED 1.7.2011 4. LETTER NO.690 DATED 8.7.2011 AND 5. LETTER NO.698 DATED 20.7.2011 IN RESPONSE TO THESE OPPORTUNITY LETTERS ISSUED AND SERVED ON THE ASSESSEE THE ASSESSEE FURNISHED WRITTEN REPLY VIDE HIS LETTER DATED 16.8.2011 AS UNDER: THIS BEARS REFERENCE TO YOUR LETTER DATED 20.7.20 11, THEREBY INVITING ASSESSEES EXPLANATION WITH DOCUMENTARY EV IDENCE AS TO SOURCE OF CASH DEPOSIT OF RS.18,38,000/-, MADE IN H IS BANK ACCOUNT WITH AXIS BANK LIMITED, KAPURTHALA JOINTLY HELD WIT H ONE SH. LAKHBIR SINGH S/O SH. TARA SINGH. 2. UPON HAVING CLOSELY EXAMINED THE BANK A/C UNDER REFERENCE THE CASH DEPOSIT IN QUESTION HAS BEEN FOU ND TO BE AGGREGATE OF ALL THE CASH CREDITS APPEARING IN THE BANK ACCOU NT DURING THE YEAR AND NOT ONE TIME DEPOSIT, AS APPEARS TO HAVE BEEN P ROJECTED IN YOUR LETTER UNDER REPLY. NONETHELESS, THERE ARE TWO MAJO R CASH DEPOSITS, ONE FO RS.8,75,000/- ON 21.4.2008 AND THE OTHER OF RS.6,40,000/- ON 12./3.2009 WHICH WARRANT POINTED EXPLANATION. THE OTHER CREDITS OF MUCH SMALLER AMOUNTS, SEEMINGLY APPEAR TO HAVE BEEN PLOUGHED BACK FROM THE FUNDS AVAILABLE WITH THE ASSESSEE, FROM WI THDRAWALS MADE IN NORMAL COURSE, SHORTLY BEFORE MAKING SUCH DEPOSITS, WHICH IS SELF 5 EVIDENT FROM THE BANK ACCOUNT ITSELF. THE TWO MAJOR CASH DEPOSITS ARE EXPLAINED AS FOLLOWS: A) ON 21.4.2008, THERE APPEARS A CASH DEPOSIT OF RS .8,75,000/-. ON HAVING REVISITED THE RECORDS, WHEN NO PERSONAL C ASH BOOK IS MAINTAINED BY ASSESSEE, THE SOURCE OF ABOVE CASH DE POSIT HAS BEEN FOUND TO HAVE ORIGINATED FROM THE WITHDRAWAL OF RS. 10 LACS MADE BY THE ASSESSEE ON 14.1.2008 FROM SB A/C NO.0138100004 2254 HELD WITH HDFC BANK, JOINTLY WITH HIS WIFE SMT. SUREKHA SOOD. THE SAID BANK ACCOUNT WITH HDFC NEEDLESS TO REITERATE WAS THE SUB JECT MATTER OF SCRUTINY IN IMMEDIATE PRECEDING YEAR, WHICH AFTER C LOSE FOCUSING, WAS ACCEPTED FOR ALL THE SOURCES EXPLAINING THE DEPOSIT S MADE IN THAT ACCOUNT VIDE ORDER DATED 20.12.2010 PASSED U/S 143( 3) BY YOUR PREDECESSOR. THE ASSESSEE HAD MADE STILL MORE WITHD RAWALS FROM THE SAID BANK ACCOUNT HELD WITH HDFC, SO THAT THE FLOA TING FUNDS ALWAYS REMAINED AT HIS COMMAND TO MEET ANY EVENTUALITY, MA Y BE FOR MEETING A PERSONAL CONTINGENCY OR FOR MAKING ANY INVESTMENT /DEPOSIT ETC. THE AMOUNTS DEPOSITED INVARIABLY REMAINING FAR LESS THA N THE FUNDS DRAWN, WHETHER CUMULATIVE OR OTHERWISE, HARDLY LEAV ES ANY ROOM TO DOUBT THE SOURCE OF CASH DEPOSITS. A COPY OF THE SA ID BANK ACCOUNT WITH HDFC, THOUGH ALREADY AVAILABLE IN DEPARTMENT S ASSESSMENT RECORD FOR EARLIER YEAR, IS STILL ENCLOSED TO FACIL ITATE QUICK REFERENCE. B) THE OTHER NOTABLE CREDIT IN THE SAID BANK ACCOUN T OF RS.6,40,000 APPEARS ON 12.3.2009. IT ALSO DESERVES PERTINENT MENTION AT THIS VERY JUNCTURE THAT A DAY AFTER I.E. ON 14.3 .2009, THERE IS WITHDRAWALS OF RS.7 LACS BY SH. LAKHBIR SINGH, THE OTHER HOLDER OF THE BANK ACCOUNT. THIS WITHDRAWAL ITSELF EXPLAINS THE S OURCE OF DEPOSIT, HAVING BEEN MADE BY SH. LAKHBIR SINGH. SH. LAKHBIR SINGH WAS IN THE TOWN WITH THE IMPUGNED AMOUNT OF RS.6.40 LACS TO EF FECT PURCHASEOF A TRACTOR TROLLEY. THE DEAL HAVING BEEN PUT OFF FOR A DAY OR SO, HE CHOSE TO PARK HIS FUNDS IN THE SAID ACCOUNT, TOWARDS ANY RISK OF CARRYING HEAVY CASH, BACK TO HIS VILLAGE SIMPLY TO BE BROUGH T BACK A DAY AFTER, WHEN THE DEAL WAS LIKELY TO MATERIALIZE. HOWEVER, O N 14.03.2009, WHEN THE DEAL ENDED FOR AN AMOUNT LARGER THAN HE HA D PARKED, ON 14.3.2009, WHEN THE DEAL ENDED FOR AN AMOUNT LARGER THAN HE HAD PARKED, HE MADE A WITHDRAWAL OF RS. 7 LACS FROM THE BANK, OF COURSE WITH THE CONSENT OF ASSESSEE. NOW THE SOURCE FOR TH IS AMOUNT OF RS.6.40 LACS HE HAS EXPLAINED TO ASSESSEE, IS THE F UNDS ALREADY AVAILABLE AS ALSO THE PROCEEDS HE HAD COLLECTED SOM E TIME BACK FROM 6 TWO OF THE COMMISSION AGENTS AS UNDER, AGAINST THE SALE OF HIS AGRICULTURE PRODUCED:- RS.4,35,238.78 COLLECTED ON 14.10.2008 FROM M/S. S HAHI MOHAN MOHAN LAL GRAIN MARKET, FATTU DHINGA, DISTRICT KAPU RTHALA AGAINST SALE OF HIS PADDY CROP: RS.3,44,048/- COLLECTD ON 25.5.2008 FROM M/S. KISS AN TRADING CO. GRAIN MARKET, FATTU DHINGA, AGAINST SALE OF WHE AT CROP; COPIES OF ACCOUNT OF SH. LAKHBIR SINGH IN THE BOOK S OF ABOVE TWO PARTIES, EVIDENCING THE TRANSACTIONS, ARE ENCLO SED FOR KIND PERUSAL. 3.2. I HAVE CAREFULLY CONSIDERED THE REPLY FURNISHE D BY THE ASSESSEE AFTER AVAILING OF A NUMBER OF OPPORTUNITIES AS MENT IONED ABOVE AND CHANGING THE COUNSEL ALSO DURING ASSESSMENT PROCEE DINGS WITH REFERENCE TO ALL THE FACTS, MATERIAL AND EVIDENCE A VAILABLE ON RECORD. IT IS NOT CLARIFIED BY EITHER OF THE TWO LEARNED CO UNSELS IN THE WRITTEN REPLY AS TO WHY THE ASSESSEE CHOSE TO OPEN IMPUGNED BANK ACCOUNT WITH AXIS BANK, KAPURTHALA IN THE NAME OF SH. LAKHB IR SINGH S/O SH. TARA SINGH R/O VPO FATTU DHINGA BY GIVING HIS OWN P ERMANENT ACCOUNT NUMBER AND KEEPING THE SAID SHRI LAKHBIR SI GH AS HIS JOINT ACCOUNT HOLDER OF THE IMPUGNED BANK ACCOUNT. THE AS SESSEE IS A DOCTOR BY PROFESSION AND SH. LAKHBIR SINGH IS AN AG RICULTURIST WITH RESIDENCE AT A FAR OFF PLACE I.E. VPO FATTU DHINGA FROM KAPURTHALA. THERE IS NO INTER SE BUSINESS, PROFESSIONAL OR PERS ONAL RELATION BETWEEN THE ASSESSEE AND THE SAID SH.LAKHBIR SINGH. THE ASSESSEE HAS ALSO NOT FURNISHED HIS CONFIRMATION THROUGH A SWORN AFFIDAVIT OR PRODUCED HIM FOR EXAMINATION TO SUPPORT HIS CONTENT ION THAT HE HAD ACTUALLY MADE DEPOSIT OF RS.6.40 LACS IN THE IMPUGN ED BANK ACCOUNT OF THE ASSESSEE. MORESO THERE IS NO VALID REASON FOR S H. LAKHBIR SIGH TO DEPOSIT SO BIG AN AMOUNT IN THE BANK ACCOUNT OF THE ASSESSEE. IN THE ABSENCE OF CONFIRMATION OF SH. LAKHBIR SINGH IT IS CLEAR THAT THE IMPUGNED BANK MIGHT HAVE BEEN OPENED BY THE ASSESS EE IN THE NAME OF SH. LAKHBIR SINGH TO CAMOUFLAGE THE DUBIOUS CASH TRANSACTIONS TO HOODWINK THE INCOME TAX DEPARTMENT IN SUCH A FASHIO N. 7 3.3. THE STORY PUT UP BY THE ASSESEE THAT A SUM OF RS.6.40 LACS WAS DEPOSITED BY HIM AFTER THE SALE PROCEEDS OF HIS AGR ICULTURAL PRODUCE IS A CONCOCTED STORY FOR THE FOLLOWING REASONS: I. THAT IMPUGNED CASH DEPOSIT OF RS.6.40 LACS HAS B EEN MADE ON 12.3.2009 WHEREAS PADDY CROP FOR A SUM OF RS.4,35,2 38/- WAS SOLD ON 14.10.2008 AND WHEAT CROP FOR A SUM OF RS.3,44,048/ - ON 25.5.2008 THROUGH M/S. SHASHI MOHAN MOHAN LAL, GRAIN MARKET, VPO FATTU DHINGA; II. THAT NO PRUDENT PERSON WOULD LIKE TO PARK HIS F UNDS IDLE AT HOME FOR A LONG PERIOD OF SIX TO NINE MONTHS SPECIA LLY WHEN BANKING FACILITY IS AVAILABLE THESE DAYS EVERY WHERE PARTI CULARLY IN A VILLAGE FATTU, DHINGA WHICH AN INDUSTRIAL HUB OF RICE MANUF ACTURERS; III. THAT EVEN IF THE FUNDS ARE AVAILABLE WITH ANY PERSON HE WOULD LIKE TO DEPOSIT IN HIS OWN BANK ACCOUNT AND THE BAN K ACCOUNT OF SOME ONE ELSE UNLIKE THE PRESENT CASE, KNOWING FULL WELL THAT HIS FUNDS COULD BE MISAPPROPRIATED BY THE ACCOUNT HOLDER WITHOUT HI S KNOWLEDGE, LEAVING THEREBY THE PERSON CONCERNED TO FALL BACK O N LITIGATION. IV. THAT THE CASH DEPOSIT OF RS.6.40 LACS IN THE BA NK A/C OF THE ASSESSEE IS ON 12.3.2009 WHEREAS SO CALLED WITHDRAW AL OF RS.71 LACS BY SH. LAKHBIR SINGH IS ON 14.3.2009; IT IS THEREFO RE NOT UNDERSTOOD AS TO HOW AMOUNT WITHDRAWN ON 14.3.2009 COME IN THE BA NK ACCOUNT OF THE ASSESSEE ON 12.3.2009. V. THAT COPIES OF ACCOUNT OF SH. LAKHBIR SINGH FOR F.Y. 2008-09 AS APPEARING IN THE BOOKS OF ACCOUNT OF M/S. SHASHI MO HAN MOHAN LAL, COMMISSION AGENTS, VPO FATTU DHINGA AS FURNISHED BY THE ASSESSEE ARE UNSIGNED AND UNATTESTED EITHER BY THE SAID PART Y OR BY SH.LAKHBIR SINGH OR BY THE ASSESSEE; PRINTED PAD ON WHICH THE COPY OF ACCOUNT OF THE SAID LAKHBIR SINGH HAS BEEN NOTED DOES NOT BEAR EVEN VAT NUMBER/SALES TAX NUMBER OF THE PARTY THOUGH IT IS M UST FOR EACH AND EVERY COMMISSION AGENT; SUCH COPIES OF ACCOUNT, THE REFORE, DO NOT CARRY ANY EVIDENTIARY VALUE. 3.4. `FOR THESE REASONS CASH DEPOSIT OF RS.6.40 LAC S IS HELD AS UNEXPLAINED U/S 69A OF THE ACT. AS THE ASSESSEE HAS CONCEALED HIS 8 INCOME, ON ACCOUNT OF UNEXPLAINED CASH DEPOSITS OF RS.6.40 LACS, PENALTY PROCEEDINGS U/S 271(1)(C) HAVE BEEN INITIAT ED SEPARATELY. 3.5. AS REGARDS THE FOLLOWING WITHDRAWALS: 14.1.2008 CHQ PAID-KAPURTHALA-PU-0433252 RS.10 LAC 16.1.2008 CHQ PAID-KAPURTHALA-PU-0433253 75,000/- 21.1.2008 CHQ PAID-KAPURTHALA-PU-0433258 RS.4 LAC IT IS SEEN THAT THESE ARE NOT CASH WITHDRAWALS. TH ESE WITHDRAWALS MIGHT HAVE GONE TO SOME ACCOUNT OF THE ASSESSEE OR SOME ONE ELSE TO WHOM SUCH CHEQUES MIGHT HAVE BEEN ISSUED BY THE ASS ESSEE. THEREFORE, THESE WITHDRAWALS ON 14.1.2008 CANNOT B E RELATED TO THE CASH DEPOSIT OF RS.8.75 LACS ON 21.4.2008. CASH DE POSIT OF RS.8.75 LACS REMAINS UNEXPLAINED AND THE SAME IS ADDED TO T HE ASSESSABLE INCOME OF THE ASSESSEE U/S 69A OF THE ACT. AS THE A SSESSEE HAS CONCEALED HIS INCOME ON ACCOUNT OF UNEXPLAINED CASH DEPOSITS OF RS.8.75 LACS, PENALTY PROCEEDINGS U/S 271(1)(C) HAV E BEEN INITIATED SEPARATELY. 4. FOR THE REMAINING CASH DEPOSITS THE ASSESSEE HAS NOT FURNISHED ANY DOCUMENTARY EVIDENCE TO EXPLAIN THE SOURCE THER EOF. HIS EXPLANATION THAT THESE ARE MINOR CASH DEPOSITS AND MAY BE FROM WITHDRAWALS MADE ON EARLIER DATES DOES NOT HOLD GOO D AS HE HAS NOT BEEN ABLE TO CORRELATE ANY OF THE WITHDRAWALS MADE EARLIER WITH THE CASH MADE LATER DURING F.Y. 2008-09. THE REMAINING CASH DEPOSIT OF RS.3,23,000/- (RS.18,38,000-(8.75 LACS AND RS.6.40 LACS)+3.23 LACS) IS ALSO HELD AS UNEXPLAINED U/S 69A OF THE ACT. AS TH E ASSESSEE HAS CONCEALED HIS INCOME ON ACCOUNT OF UNEXPLAINED CASH DEPOSITS OF RS.3,23,000/-, PENALTY PROCEEDINGS U/S 271(1) HAVE BEEN INITIATED SEPARATELY. 5. ADDITION ON ACCOUNT OF UNEXPLAINED FDR AMOUNT OF RS. 7 LAKH PURCHASED ON 16.3.2009 IN THE JOINT NAME OF ASSESSE E AND SH. LAKHBIR SINGH IN A/C NO.088010400118361 WITH AXIS BANK, KA PURTHALA, ON 16.3.2009. VIDE THIS OFFICE LETTER NO.541 DATED 24.6.2011 SER VED ON THE ASSESSEE ON 25.6.2011, THE ASSESSEE WAS ASKED TO EX PLAIN THE SOURCE OF FDR OF RS. 7 LAKH PURCHASED ON 16.3.2009 IN THE JOI NT NAME OF 9 ASSESSEE AND SH. LAKHBIR SINGH S/O SH.TARA SINGH IN A/C NO. .088010400118361 WITH AXIS BANK, KAPURTHALA, ON 16. 3.2009. IN RESPONSE THERETO THE ASSESSEE FURNISHED WRITTEN REPLY DATED 16.8.2011 GIVING THEREIN EXPLANATION OF CASH DEPOSI TS OF RS.8.75 LAKHS AND RS.6.40 LAKHS WHICH HAVE BEEN DISCUSSED HEREINA BOVE. THE ASSESSEE HAS HOWEVER, NOT FURNISHED ANY EVIDENCE, M UCH LESS DOCUMENTARY EVIDENCE FOR THE PURCHASE OF THE SAID F DR. ACCORDINGLY, IT IS HELD THAT THE SAID SUM OF RS. 7 LAKH IS UNEXP LAINED U/S 69A OF THE ACT. AS THE ASSESSEE HAS CONCEALED HIS INCOME ON AC COUNT OF UNEXPLAINED FDR OF RS.7 LACS, PENALTY PROCEEDINGS U /S 271(1)(C) HAVE BEEN INITIATED SEPARATELY. 6. ADDITION ON ACCOUNT OF UNDECLARED BANK INTEREST OF RS.21,218/- VIDE THIS OFFICE LETTER NO.541 DATED 24.6.2011 SERV ED ON THE ASSESSEE ON 25.6.2011, THE ASSESSEE WAS ASKED TO EX PLAIN THE SOURCE OF BANK INTEREST OF RS.21,218/- (RS9161 ON BANK A/C NO .088013294 WITH AXIS BANK + 2896 FDR INTEREST OF RS. 7 LAKH + 9161 ON BANK A/C NO.088010400089803 WITH AXIS BANK, KAPURTHALA = 21, 218/-) DURING F.Y.2008-09. IN RESPONSE THERETO THE ASSESSEE FURNISHED WRITTEN REPLY DATED 16.8.2011 GIVING THEREIN EXPLANATION OF CASH DEPOSI TS OF RS.8.75 LACS AND RS.6.4 LACS WHICH HAVE BEEN DISCUSSED HEREINABO VE. THE ASSESSEE HAS HOWEVER, NOT FURNISHED ANY EXPLANATION FOR NON- DECLARATION OF THE SAID BANK INTEREST IN HIS RETURN OF INCOME. ACCORDI NGLY, IT IS HELD THAT THE SAID SUM OF RS.21,218/- IS UNEXPLAINED U/S 69A OF THE ACT. AS THE ASSESSEE HAS CONCEALED HIS INCOME ON ACCOUNT OF UNE XPLAINED CASH DEPOSITS OF RS.21,218/-, , PENALTY PROCEEDINGS U/S 271(1)(C) HAVE BEEN INITIATED SEPARATELY. 4. BEFORE THE LD. CIT(A), THE ASSESSEE FILED THE AD DITIONAL EVIDENCES, WHICH WERE SENT TO THE AO FOR COMMENTS AND AFTER RE CEIVING COMMENTS, THE SAME WERE ADMITTED AND THE LD. CIT(A) DELETED THE ADDITIONS OF RS.8.75 LACS 10 AND RS.6.40 LACS AND SUSTAINED THE ADDITIONS OF RS .3,23 LACS AND RS.21,218/-. 5. THE LD. COUNSEL FOR THE ASSESSEE, MR. J.S.BHASIN , ADVOCATE MADE THE ARGUMENTS ON THE SIMILAR LINES AS SUBMITTED BEFORE THE LD. CIT(A. 6. THE LD. JCIT(DR), MR. MAHAVIR SINGH, ON THE OTHE R HAND, RELIED UPON THE ORDER OF THE A.O. AND ARGUED THAT THE LD. CIT(A) WAS NOT JUSTIFIED IN ADMITTING THE ADDITIONAL EVIDENCES SINCE THE ASS ESSEE WAS GIVEN AMPLE OPPORTUNITIES OF BEING HEARD BY THE A.O. 7. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE FACTS OF THE CASE. AS REGARDS THE ADDITIONAL EVIDENCES SUBMITTED BY TH E LD. COUNSEL FOR THE ASSESSEE, THERE IS NO DISPUTE TO THE FACT TAT THE A SSESSEE HAS FILED AN EXPLANATION VIDE LETTER DATED 16.8.2011 AND THEREAF TER NO QUERY WAS RAISED BY THE AO AND THE AO SIMPLY MADE THE ADDITION WITHOUT CONSIDERING THE SAID EXPLANATION. EVEN IF THE ASSESSEE HAS NOT CO-OPER ATED IN THE EARLIER PART OF THE PROCEEDINGS BUT ULTIMATELY ON 16.8.2011, HE HAD SUBMITTED THE EXPLANATION, WHICH IN FACT, SHOULD HAVE BEEN TAKEN COGNIZANCE BY THE AO AND THE ORDER PASSED ON 26.08.2011 AFTER 10 DAYS OF THE RECEIPT OF THE EXPLANATION. THEREFORE, WE FIND NO INFIRMITY IN TH E ORDER OF THE LD. CIT(A) IN ADMITTING THE ADDITIONAL EVIDENCES, ESPECIALLY W HEN THE REMAND REPORT WAS TAKEN FROM THE A.O. 11 7.1. AS REGARDS THE ISSUE ON MERIT WITH REGARD TO T HE DEPOSITS IN THE BANK ACCOUNT WITH AXIS BANK REGARDING RS.8.75 LACS, WHI CH HAS BEEN DELETED BY THE LD. CIT(A), THE CONTENTION OF THE ASSESSEE WAS THAT THERE WAS WITHDRAWAL OF RS.10 LACS ON 14.1.2008 FROM HDFC BANK, THE ACCO UNT HELD BY THE ASSESSEE JOINTLY WITH HIS WIFE SMT. SUREKHA SOOD. THE CERTIFICATE FROM THE SAID BANK CONFIRMING THAT CASH HAS BEEN WITHDRAWN ON 14.01.2008 I.E. DURING THE YEAR ENDING 31.03.2008 PERTAINING TO ASS ESSMENT YEAR 2008-09 WAS PLACED ON RECORD. A QUERY WAS ASKED FROM THE LD . COUNSEL WITH REGARD TO THE PROOF OF FILING THE RETURN FOR THE PROCEEDIN G YEAR I.E. A.Y. 2008-09 AND IF ANY DOCUMENTARY EVIDENCE WAS PLACED ON RECO RD BEFORE ANY OF THE AUTHORITIES BELOW OR BEFORE US AS PART OF THE PAPER BOOK TO SUBSTANTIATE WHETHER THE ASSESSEE WAS HAVING CASH IN HAND AVAIL ABLE TO DEPOSIT OF RS.8.75 LACS AS ON 31.3.2008 FOR DEPOSITING THE SAM E ON 21.04.2008 IN AXIS BANK. THE LD. COUNSEL FOR THE ASSESSEE DID NOT REPL Y IN FAVOUR OF THE ASSESSEE AND WE FOUND THAT THERE IS NO DOCUMENTARY EVIDENCE PLACED BEFORE ANY OF THE AUTHORITIES BELOW OR BEFORE US WITH REGA RD TO THE AVAILABILITY OF CASH IN HAND AS ON 31.03.2008 PERTAINING TO THE ASS ESSMENT YEAR 2008-09. THEREFORE, SIMPLY SUBMITTING CERTIFICATE FROM THE B ANK I.E. HDFC BANK THAT CASH WITHDRAWAL OF RS.10 LACS WAS MADE AVAILABLE C ANNOT SUBSTANTIATE THE CLAIM OF THE ASSESSEE. IT IS NOT FOR THE AO TO A CCEPT THE CLAIM OF THE 12 ASSESSEE THAT CASH IN HAND WITHDRAWN FROM THE EARLI ER YEARS SHOULD BE ACCEPTED AS SOURCE IN THE IMPUGNED YEAR. THE PERSO N WHO MAKES CLAIM HAS TO PROVE IT IS THE SETTLED LAW. IN THE PRESENT CASE , THE ASSESSEE HAS CLAIMED THE WITHDRAWAL OF RS. 10 LACS ON 14.01.2008, WAS AVAILA BLE FOR DEPOSIT ON 21.04.2008 AT RS.8.75 LACS, EVEN BOOKS OF ACCOUNT A RE NOT MAINTAINED BY THE ASSESSEE. THE ASSESSEE HAS TO SUBSTANTIATE AND TO P ROVE THE CLAIM THAT SUCH CASH IN HAND WAS AVAILABLE IN THE IMPUGNED YEAR WH ERE THE CREDIT FOUND IN THE BANK ACCOUNT OF THE ASSESSEE REMAINED UNEXPLAIN ED. THEREFORE, THE LD. CIT(A) IS NOT JUSTIFIED IN DELETING THE SAID ADDITI ON OF RS.8.75 LACS. ACCORDINGLY, THE ORDER OF THE LD. CIT(A) IS REVERSE D THAT OF THE AO IS RESTORED TO THE EXTENT OF ADDITION OF RS.8.75 LACS. THE AO IS ACCORDINGLY DIRECTED TO SUSTAIN AN ADDITION OF RS.8.75 LACS OUT OF THE TOTAL ADDITION MADE OF RS.18.38 LACS. 7.2. AS REGARDS THE ADDITION OF RS.6.40 LACS , THE SAME HAS BEEN DELETED BY THE LD. CIT(A) ON SUBMITTING THE ADDITIONAL EVIDENC E AND THE DEPARTMENT IS NOT IN APPEAL BEFORE US ON THAT GROUND. THEREFORE, THE REASONABLE PRESUMPTION IS MADE THAT THE DEPARTMENT HAS ACCEPTE D THE SOURCES OF RS.6.40 LACS. 7.3. AS REGARDS THE ADDITION OF RS. 7 LACS MADE UND ER SECTION 69 OF THE ACT, THE SOURCE OF RS.7 LACS IS THE DEPOSIT OF RS.6.40 L ACS WHICH IS EVIDENT FROM 13 THE COPY OF BANK ACCOUNT THAT THE DEPOSIT WAS MADE ON 12.03.2009 AMOUNTING TO RS.6.40 LACS WHICH MAKES THE BALANCE I N THE AXIS BANK AT RS.7,86,432/-. WHEREAS ON 14.03.2009. RS. 7 LACS H AS BEEN WITHDRAWN AND FDR WAS MADE ON 16.03.2009. THIS CLEARLY ESTABLISHE S THAT THE SOURCE OF ADDITION OF RS.7 LACS CANNOT BE MADE AND THE LD. CI T(A) WAS NOT JUSTIFIED IN CONFIRMING THE ADDITION AND THE AO IS DIRECTED TO DELETE THE SAID ADDITION. 7.4. AS REGARDS THE ADDITION OF RS.3.23 LACS SUBMIT TED BEFORE THE AUTHORITIES BELOW IS ACCEPTED THAT CASH IN HAND HAS BEEN WITHDRAWN FROM TIME TO TIME AND AS ARGUED BY THE LD. COUNSEL FOR THE ASSESSEE THAT CASH HAS BEEN WITHDRAWN ON 07.06.2008 AND 23.06.208 AMOUNTI NG TO RS.3,60,000/- AND RS.4,00,000/- AND THEREAFTER THE AMOUNT HAS BEE N WITHDRAWN FROM TIME TO TIME AND HAS BEEN DEPOSITED AND THEREFORE, THE BALANCE OF RS.3,23,000/- ALSO STANDS EXPLAINED ON A GIVEN SET OFF OUT OF WIT HDRAWALS MADE FROM TIME TO TIME FROM AXIS BANK. ACCORDINGLY, THE SAID ADDIT ION CONFIRMED BY THE LD. CIT(A) IS DIRECTED TO BE DELETED. 7.5. AS REGARDS THE ADDITION ON ACCOUNT OF UNDISCLO SED BANK INTEREST OF RS.21,218/-, THE ASSESSEE HAS SUBMITTED THAT HE HAS ALREADY DECLARED INCOME FROM OTHER SOURCES AMOUNTING TO RS.1,78,975/- OUT O F TOTAL DECLARED AMOUNT OF RS.4,63,975/- AND THE SAID INTEREST OF RS.21,218 /- IS PART OF INTEREST INCOME FROM OTHER SOURCES AT RS.1,78,975/-. THE ASS ESSEE HAS NOT GIVEN ANY 14 DETAILS OF THE INCOME DECLARED AT RS.1,78,975/-, WH ETHER THE SAID INTEREST OF RS.21,218/- CREDITED IN THE AXIS BANK IS A PART OF THE SECOND SUM IN THE ABSENCE OF ANY DOCUMENTARY EVIDENCE AND DETAILS. T HE EXPLANATION OF THE ASSESSEE CANNOT BE ACCEPTED. THUS, WE FIND NO INFIR MITY IN THE ORDER OF THE LD. CIT(A) AND THE SAME IS UPHELD. ACCORDINGLY, G ROUND NO.6 OF THE ASSESSEE IS DISMISSED AND GROUNDS NO. 1 TO 5 OF THE ASSESSEE ARE ALLOWED. 8. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IN ITA NO.302(ASR)/2013 IS PARTLY ALLOWED AND THAT OF THE REVENUE IN ITA NO.305(ASR)/2013 IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 24TH FEBRUARY, 2014. SD/- SD/- (H.S. SIDHU) (B.P. JAIN) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 24TH FEBRUARY, 2014 /SKR/ COPY OF THE ORDER FORWARDED TO: 1. THE ASSESSEE:SH.VARINDER KUMAR SUD, KAPURTHALA. 2. THE ITO WARD-II, KAPURTHALA. 3. THE CIT(A), JLR 4. THE CIT, JLR 5. THE SR DR, ITAT, AMRITSAR. TRUE COPY BY ORDER (ASSISTANT REGISTRAR) INCOME TAX APPELLATE TRIBUNAL, AMRITSAR BENCH: AMRITSAR