Sri Manchukonda Mani, Visakhapatnam V. The ITO, Ward-1(1)., Visakhapatnam

ITA 311/VIZ/2008

• Counselvise Citation: [2011] 140 COUNSELVISE.COM (IT) 50247 (ITAT-VISAKHAPATNAM)
• Duration Of Justice: 2 year(s) 11 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-06-2011
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: DB
• Next Hearing Date: 31-03-2011
• Assessment Year: 2004-2005
• Appeal Filed On: 04-06-2008
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: D S SUNDER SINGH
• Assessee Lawyers: C V S MURTHY
• Keywords: Unexplained investment
• Section: 68; 148

Judgement Text

ITA NO 311 OF 2008 MANCHUKONDA MANI VISAKHAPATNAM PAGE 1 OF 4 IN THE INCOME TAX APPELLATE TRIBUNAL VISAKHAPATNAM BENCH, VISAKHAPATNAM BEFORE: SHRI SUNIL KUMAR YADAV, JUDICIAL MEMBER AND SHRI BR BASKARAN, ACCOUNTANT MEMBER ITA NO. 311 /VIZAG/ 20 08 ASSESSMENT YEAR: 200 4 - 05 MANCHUKONDA MANI, VISAKHAPATNAM VS. ITO WARD - 1(1) VISAKHAPATNAM (APPELLANT) PAN NO:AHVPM 9252 E (RESPONDENT) ASSESSEE BY: SHRI C. V.S. MURTHY, CA DEPARTMENT BY: SHRI D.S. SUNDER SINGH, DR ORDER PER SHRI SUNIL KUMAR YADAV, JUDICIAL MEMBER THIS APPEAL IS PREFERRED BY THE ASSESSEE AGAINST T HE ORDER OF THE CIT (A) MAINLY ON THREE GROUNDS. THE FIRST GROUND RELATES T O THE VALIDITY OF THE NOTICES ISSUED U/S 148 OF THE ACT. BUT THIS GROUND IS NOT P RESSED BY THE LD COUNSEL FOR THE ASSESSEE DURING THE COURSE OF HEARING OF THE AP PEAL. WE ACCORDINGLY DISMISS THIS GROUND BEING NOT PRESSED. 2. THE NEXT GROUND RELATES TO AN ADDITION OF RS.4.0 0 LAKHS MADE ON ACCOUNT OF ITS DEPOSITS IN THE BANK A/C OF THE ASSESSEE AS UNEXPLAINED INVESTMENT. IN THIS REGARD THE FACTS BORNE OUT FROM THE RECORD IS THAT A SUM OF RS.4 LAKH WAS NOTED TO HAVE BEEN CREDITED IN THE ASSESSES BANK A/C. ON BEING CONFRONTED THE ASSESSEE ONLY STATED THAT THE AMOUNT WAS RECEIVED T HROUGH A/C PAYEE CHEQUE FROM FOUR CREDITORS BUT THE ASSESSEE COULD NOT FURN ISH THE DETAILS OF THE CREDITORS FROM WHOM THE SAID AMOUNT WAS RECEIVED. HE FURTHER CONTENDED THAT IT WAS THE DUTY OF THE ASSESSING OFFICER TO INVESTIGATE AND FI ND OUT THE PERSONS WHO GAVE ITA NO 311 OF 2008 MANCHUKONDA MANI VISAKHAPATNAM PAGE 2 OF 4 THE SAID CHEQUES AS IT WAS CREDITED IN THE BANK A/C THROUGH CHEQUE. FINDING NO FORCE IN THE ARGUMENT, THE ASSESSING OFFICER HAS MA DE THE ADDITION OF THE SAME U/S 69A OF THE ACT. SIMILAR WAS THE POSITION BEFORE THE CIT (A) AS NO DETAILS OF CREDITORS WERE FURNISHED AND THE ADDITIONS WERE CON FIRMED. 3. DURING THE COURSE OF HEARING OF THE APPEAL, A SP ECIFIC QUERY WAS RAISED TO FURNISH THE DETAILS OF THE CREDITORS FROM WHOM THIS AMOUNT WAS RECEIVED. BUT THE ASSESSEE FAILED TO FURNISH THE DETAILS. THE LD COUNSEL FOR THE ASSESSEE HOWEVER CONTENDED THAT SINCE THIS CREDIT WAS FOUND IN THE BANK A/C IT CANNOT BE TREATED U/S 68 OF THE ACT. 4. THE LD DEPARTMENTAL REPRESENTATIVE ON THE OTHER HAND HAS SUBMITTED THAT THE ADDITION WAS MADE U/S 69A OF THE ACT. WHEN CERT AIN CREDIT ENTRIES ARE FOUND IN THE BANK A/C OF THE ASSESSEE, THE ONUS IS ON THE ASSESSEE TO EXPLAIN THE SOURCE OF THE DEPOSIT. IF HE FAILED TO DO SO THE AS SESSING OFFICER IS AT LIBERTY TO MAKE THE ADDITION OF THE SAME U/S 69A OR U/S 68 OF THE ACT. SINCE THE ASSESSEE COULD NOT FURNISH THE SOURCE OF DEPOSIT IN HIS BANK A/C, THE ASSESSING OFFICER HAS RIGHTLY MADE THE ADDITION OF THE SAME U/S 69A OF TH E ACT. 5. HAVING CAREFULLY EXAMINED THE IMPUGNED ISSUE IN THE LIGHT OF RIVAL SUBMISSIONS AND THE MATERIAL AVAILABLE ON RECORD, W E FIND THAT UNDISPUTEDLY THE CREDIT ENTRIES OF RS.4 LAKH WAS FOUND IN THE BANK A /C OF THE ASSESSEE. THEREFORE, THE ONUS IS ON THE ASSESSEE TO FURNISH THE SOURCE O F DEPOSITS IN HER BANK A/C. IF SHE FAIL TO DO SO, THE ADDITION CAN BE MADE U/S 69A OF THE ACT AS UNEXPLAINED INVESTMENT. DURING THE COURSE OF THE HEARING AN OP PORTUNITY WAS AFFORDED TO THE ASSESSEE TO FURNISH THE SOURCE OF DEPOSIT BUT SHE C OULD NOT FURNISH THE SAME. SHE HOWEVER REQUESTED TO SEND THE MATTER BACK TO TH E FILE OF THE ASSESSING OFFICER SO THAT ASSESSING OFFICER CAN MAKE NECESSAR Y INQUIRY. WE DO NOT AGREE WITH THIS PREPOSITION OF THE ASSESSEE IN AS MUCH AS IT WAS THE DUTY OF THE ITA NO 311 OF 2008 MANCHUKONDA MANI VISAKHAPATNAM PAGE 3 OF 4 ASSESSEE TO EXPLAIN THE SOURCE OF DEPOSIT IN HER BA NK A/C AND ONCE THE ASSESSEE IS FAILED TO DISCHARGE ITS PRIMARY ONUS, THE REVENU E IS WITHIN ITS RIGHT TO MAKE THE ADDITION. WE THEREFORE, FIND NO INFIRMITY IN THE OR DER OF THE LOWER AUTHORITIES. ACCORDINGLY WE CONFIRM THE ORDER OF THE CIT (A) IN THIS REGARD. 6. THE NEXT GROUND RELATE TO THE DISALLOWANCE OF IN TEREST OF RS.1,39,335/- CLAIMED BY THE ASSESSEE AS DEDUCTION UNDER THE HEAD INCOME FROM HOUSE PROPERTY. THE FACTS BORNE OUT FROM THE RECORD IN TH IS REGARD ARE THAT THE ASSESSEE HAS TAKEN AN UNSECURED LOAN FOR THE PURPOS E OF CONSTRUCTION OF PROPERTY DURING THE ASSESSMENT YEAR 2001-02 BUT THE SAID LOAN WAS DISALLOWED BY THE ASSESSING OFFICER WHILE FRAMING THE ASSESSME NT, AND ADDITION U/S 68 WERE MADE. THE CORRESPONDING INTEREST IN THE IMPUGNED AS SESSMENT YEAR OF RS.1,39,335/- WAS ALSO DISALLOWED BY THE ASSESSING OFFICER RELYING UPON THE ORDER OF THE CIT (A) DURING 2001-02. IN THAT ASSESS MENT YEAR THE ASSESSEE PREFERRED AN APPEAL BEFORE THE TRIBUNAL AND THE TRI BUNAL HAS SET ASIDE THE ORDER OF THE CIT (A) AND RESTORED THE MATTER BACK TO THE FILE OF THE ASSESSING OFFICER FOR READJUDICATION. SINCE THE ISSUE OF GENUINENESS OF THE UNSECURED LOAN IS SUBJUDICE BEFORE THE ASSESSING OFFICER, THE CORRESP ONDING INTEREST PAID IN THE IMPUGNED ASSESSMENT YEAR CANNOT BE DISALLOWED. THER EFORE, THIS ISSUE SHOULD ALSO BACK TO THE ASSESSING OFFICER FOR READJUDICATI ON IN THE LIGHT OF THE DECISION TAKEN BY THE REVENUE AUTHORITIES WITH REGARD TO THE ORIGINAL UNSECURED LOAN INTRODUCED IN ASSESSMENT YEAR 2001-02. 7. IN THE LIGHT OF THESE FACTS BOTH THE PARTIES HAV E AGREED THAT THE MATTER SHOULD BE SENT BACK TO THE FILE OF THE ASSESSING OF FICER FOR READJUDICATION OF THE ISSUE IN TERMS OF FINAL OUTCOME OF THE GENUINENESS OF UNSECURED LOAN OBTAINED FOR THE PURPOSE OF CONSTRUCTION OF HOUSE DURING THE ASSESSMENT YEAR 2001-02. WE ACCORDINGLY SET ASIDE THE ORDER OF THE CIT (A) A ND RESTORE THE MATTER BACK TO THE FILE OF THE ASSESSING OFFICER FOR READJUDICATIO N IN TERMS INDICATED ABOVE. ITA NO 311 OF 2008 MANCHUKONDA MANI VISAKHAPATNAM PAGE 4 OF 4 6. IN THE RESULT THE APPEAL OF THE ASSESSEE IS PART LY ALLOWED FOR STATISTICAL PURPOSES. PRONOUNCED IN THE OPEN COURT ON 3.6.2011. SD/- SD/- (BR BASKARAN) (SUNIL K UMAR YADAV) ACCOUNTANT MEMBER JUDICIAL MEMBER PVV/SPS VISAKHAPATNAM, DATE: 3 RD JUNE, 2011. COPY TO 1 SMT. MANCHUKONDA MANI, PLOT NO.26, PANDURANGAPURAM, VISAKHAPATNAM 2 THE ITO WARD - 1(1) VISAKHAPATNAM 3 4. THE CIT 1, VISAKHAPATN AM THE CIT(A)-I VISAKHAPATNAM 5 THE DR, ITAT, VISAKHAPATNAM. 6 GUARD FILE. BY ORDER SENIOR PRIVATE SECRETARY INCOME TAX APPELLATE TRIBUNAL VISAKHAPATNAM