Imtiyaaz Foundation for Social Care, Lucknow V. Income Tax Officer, Lucknow

ITA 312/LKW/2016

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 1069 (ITAT-LUCKNOW)
• Duration Of Justice: 1 year(s) 9 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-03-2018
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Next Hearing Date: 06-03-2018
• Assessment Year: 2009-2010
• Appeal Filed On: 01-06-2016
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Keywords: Unexplained cash credit; Earning of tax free income
• Section: 133(6); 12A; 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH A , LUCKNOW BEFORE SHRI. T.S. KAPOOR, ACCOUNTANT MEMBER AND SHRI PARTHA SARATHI CHAUDHURY, JUDICIAL MEMBER ITA NO. 312 & 313/LKW/2016 ASSESSMENT YEAR: 2009 - 10 & 2010 - 11 IMTIYAAZ FOUNDATION FOR SOCIA L CARE 4/202, VISHAL KHAND GOMTI NAGAR, LUCKNOW V. INCOME TAX OFFICER RANGE 1(2) LUCKNOW T AN /PAN : AAATI1564R (APP ELL ANT) (RESPONDENT) APPELLANT BY: SHRI YOGESH AGARWAL, ADVOCATE RESPONDENT BY: SHRI J.S. MINHAS, CIT (DR) DATE OF HEARING: 06 0 3 201 8 DATE OF PRONOUNCEMENT: 12 0 3 201 8 O R D E R PER P ARTHA SARATHI CHAUDHURY, J.M : THESE APPEALS PREFERRED BY THE ASSESSEE EMANATE FROM SEPARATE ORDERS PASSED BY THE LD. CIT(A) - I, LUCKNOW DATED 29/2/2016 ON COMMON GROUNDS OF APPEAL EXCEPT THE DIFFERENCE I N AMOUNT. 2 . THESE APPEALS WERE HEARD TOGETHER AND SINCE THE FACTS INVOLVED IN THESE APPEALS ARE SIMILAR AND THE GROUNDS ARE COMMON, THESE APPEALS ARE BEING DISPOSED BY THIS CONSOLIDATED ORDER. HOWEVER, WE WILL TAKE UP THE APPEAL IN ITA NO.312/LKW/2016 FIRST AND, AS AGREED BY BOTH THE PARTIES, OUR FINDING THEREIN SHALL BE APPLICABLE FOR ITA NO.313/LKW/2016 ALSO. 3 . THE FACTS AS NOTED BY THE ASSESSING OFFICER IN APPEAL NO.312/LKW/2016 ARE THAT I N THE RETURN OF INCO ME, THE SOCIETY HAS CLAIMED RS. 960/ - AS EXEMPT IN COME, BUT DURING THE COURSE OF ITA NO.312 & 313/LKW/201 6 PAGE 2 OF 11 ASSESSMENT PROCEEDINGS, N O SUPPORTING DOCUMENTARY EVIDENCES WERE FURNISHED IN THIS REGARD. THEREFORE, THE CLAIM OF RS. 960/ - AS EXEMPT INCOME WAS DISALLOWED AND ADDED TO THE TOTAL INCOME OF THE ASSESSEE. 4 . FURTHER, IN THE ASSES SMENT PROCEEDINGS, IT WAS FOUND THAT VOUCHES REGARDING EXPENSES WERE SELF - MADE AND WERE NOT SUPPORTED BY OUTSIDE BILLS. THE PAYMENTS WERE MADE IN CASH. THUS EXPENSES CLAIMED AMOUNTING TO RS.13,105/ - ARE NOT OPEN FOR VERIFICATION FOR WANT OF CONCLUSIVE DOCU MENTARY EVIDENCES AND THEREFORE 50% OF THE EXPENSES CLAIMED I.E. RS.6,553/ - IS BEING DISALLOWED AND ADDED TO THE TOTAL INCOME OF THE ASSESSEE. DURING THE RELEVANT FINANCIAL YEAR 2009 - 10, THE ASSESSEE SOCIETY HAS SHOWN AN ADDITION I N CAPITAL FUND AMOUNTING TO RS. 13,00,000 / - AS PER BALANCE SHEET SUBMITTED BY THE ASSESSEE. DURING THE SEARCH PROCEEDING S, THE COUNTER FOIL OF THE BANK DEPOSITS FOUND THAT FOLLOWING CASH DEPOSITS IN THE BANK ACCOUNT WITH AXIS BANK WERE FOUND: - DATE OF DEPOSITS AMOUNT 04.10.200 8 RS. 1,55,000/ - 04.10.2008 RS. 1,40,000/ - 04.10.2008 RS. 1,36,000/ - 04.10.2008 RS. 1,24,000/ - 04.10.2008 RS. 1,15,000/ - 04.10.2008 RS. 1,20,000/ - 04.10.2008 RS. 1,10,000/ - 07.10.2008 RS. 1,23,000/ - 07.10.2008 RS. 1,20,000 / - ITA NO.312 & 313/LKW/201 6 PAGE 3 OF 11 07.10.2008 RS. 1,22,000/ - 07.10.2008 RS. 1,17,000/ - 07.10.2008 RS.1,18,000/ - 19.09.2008 RS. 1,00,000/ - TOTAL RS. 16,00,000/ - 5 . D URING THE COURSE OF ASSESSMENT PROCEEDINGS , T HE ASSESSEE TRUST WAS ASKED TO FURNISH NAME AND COMPLETE ADDRESS OF PARTIES, THEIR PAN, ASSESSMENT DETAILS AND BANK DETAILS, CONFIRMATION FROM PARTIES ETC. AND TO PRODUCE THEM FOR STATEMENT. THE ASSESSEE TRUST FURNISHED ONLY NAME AND ADDRESS OF PARTIES, BUT COULD NOT FURNISH THEIR PAN, ASSESSMENT DETAILS, BANK DETAILS, CON FIRMATION FROM THEM AND ALSO COULD NOT PRODUCE THEM FOR STATEMENT, DESPITE SEVERAL OPPORTUNITIES ALLOWED DURING THE COURSE OF ASSESSMENT PROCEEDINGS. THE LETTERS WERE ISSUED TO THE PARTIES CALLING FOR INFORMATION U/S 133(6) OF THE ACT. THE ENVELOPES CONTAI NING LETTER RELATING TO FOLLOWING FOUR PARTIES WERE RETURNED UN - SERVED: - SI. NO. NAME OF THE PARTY AMOUNT 1 SRI K.P. SINGH RS. 18,0007 - 2 SRI MEHAR JALIL KHAN RS. 17,000/ - 3 SMT. NIRZALA KHAN RS. 18,000/ - 4 SRI SHAKIR KHAN RS. 18,000/ - TOTAL RS. 71,000/ - ITA NO.312 & 313/LKW/201 6 PAGE 4 OF 11 6 . TH EREFORE, THE GENUINE NESS OF AFORESAID AMOUNT OF RS. 71,000/ - IS NOT VERIFIABLE. HENCE, THE AMOUNT OF RS. 71,000/ - IS BEING ADDED TO THE TOTAL INCOME OF THE ASSESSEE AS UNEXPLAINED CREDITS U/S 68 OF THE I.T. ACT. 7 . IN THE FOLLOWING C ASES , NO REPLY HAS BEEN RECEIVED FROM THE PARTIES AND THE ASSESSEE COULD NOT FURNISH THE DETAILS REGARDING PAN, ASSESSMENT DETAILS, BANK DETAILS AND CONFIRMATION OF PARTIES AND ALSO COULD NOT PRODUCE THE PARTIES FOR STATEMENT DESPITE SEVERAL OPPORTUNITIES ALLOWED DURING THE C OURSE OF ASSESSMENT PROCEEDINGS: - SI. NO. NAME OF THE PARTY AMOUNT 1 SRI AHMAD JAMAL KHAN, RS. 18,000/ - 2 SRI DAUD AHMAD RS. 15,000/ - 3 SMT. SAFIA RS. 15,000/ - 4 AJAY KUMAR SINGH RS. 18,000/ - TOTAL RS. 66,000/ - 8 . THUS, THE GENUINE NESS OF AFORESAID AMOUNT OF RS.66,000 / - WA S ALSO NOT VERIFIABLE AND, THEREFORE, ADDED THE SAME TO THE TOTAL INCOME OF THE ASSESSEE AS UNEXPLAINED CREDITS U/S 68 OF THE I.T. ACT. 9 . IN THE FOLLOWING CASES , REPLIES OF LETTERS ISSUED CALLING FOR INFORMATION U/S 133(6) OF THE ACT HAVE BEEN RECEIVED. IT WAS STATED BY THE PARTIES THAT THEY ARE NOT ASSESSED TO TAX AND HAVE NO PAN AND HAVE GIVEN DONATION/ CAPITAL FUND TO THE ASSESSEE TRUST. THEY COULD NOT FU RNISH BANK DETAILS AND ANY OTHER DETAILS REGARDING AVAILABILITY OF FUNDS HAVING ITA NO.312 & 313/LKW/201 6 PAGE 5 OF 11 THEM TO SUBSTANTIATE THE GENUINENESS OF THE MONEY GIVEN. THE ASSESSEE ALSO COULD NOT FURNISH ANY SUPPORTING DETAILS IN THIS REGARD. FROM A PERUSAL OF RECEIPTS BOOKS PRODUCED, I T WAS FOUND THAT JUST A DAY BEFORE THE DAY OF CASH DEPOSITS, THE RECEIPTS HAS BEEN ISSUED REGARDING COLLECTION OF FUND, THOUGH THE PARTIES ARE OF DIFFERENT PLACES. THUS, THE RECEIPTS BOOKS ALSO DO NOT APPEAR GENUINE AND IS AFTER THOUGHT OF THE ASSESSEE TRU ST: - SI. NO. NAME AMOUNT IN RS. 1 ABDUL RASHEED KHAN 18,000 2 ABU FAISAL 18,000 3 ABU FAISAL 15,000 4 ABU SUFIAN KHAN 17,000 5 AFREEN 16,000 6 AHMED FAISAL KHAN 18,000 7 AISHA HABIB 18,000 8 AMJAD KHAN 18,000 9 AQEEL AH MAD KHAN 15,000 10 ARSHAD 16,000 11 ARSHAD KHAN 15,000 12 ARSHIYA MASOOD 18,000 13 ASAD KHAN 17,000 U ASJAD KHAN 17,000 ITA NO.312 & 313/LKW/201 6 PAGE 6 OF 11 15 ASLAM KHAN 17,000 16 AZRA 18,000 17 BADAR JALIL KHAN 17,000 18 BILQIS KHANAM 18,000 19 BILQIS KHANAM 15,000 20 FARHEEN AHMAD 18,000 21 HABIBUR RAHMAN 21,000 22 HENA ALVI 17,000 23 HULA 18,000 24 JAWED IRSHAD 17,000 25 LUBNA ALVI 18,000 26 MARYA 17,000 27 MA SOOD SARDAR 18,000 28 MATIUDDIN 17,000 29 MEHAR AFROZ 17,000 30 MUFIDEEN NISHA 16,000 31 NAGMA NASIM 17,000 32 NASIM 18,000 33 NAZEEN 17,000 34 NAZIA 18,000 35 NEYAZ AHMAD 15,000, 36 NIZAMUDDIN KHAN 17,000 ITA NO.312 & 313/LKW/201 6 PAGE 7 OF 11 37 NUZRAT KHAN 17,000 38 QAMAR JALIL KHAN 18,000 39 RASHID UMAR 18,000 40 RAZIA KHAN 17,000 41 RIZWANA BEGUM 16,000 42 SABIA 18,000 43 SALMA KHATON 18,000 44 SANA 17,000 45 SARFRAZ AHMAD 18,000 46 SARV/AT MOIN 17,000 47 SEEMA KHAN 18,000 48 SHAHEEN 18,000 49 SHAHEEN KHAN 16,000 50 SHAHGUFTA 15,000 51 SHAHID IRSHAD 17,000 52 SHAHIDA 17,000 53 SHAHNAWAZ 18,000 54 SHAHNAWAZ AHMAD 16,000 55 SHAKEEL AHMAD KHAN 18,000 56 SHAMIN AHMAD 15,000 57 SHARIQ AL VI 17,000 ITA NO.312 & 313/LKW/201 6 PAGE 8 OF 11 58 SHAZIA QAMAR 18,000 59 SHEERIN 18,000 60 SHEERIN 16,000 61 SHOEB KHAN 17,000 62 SUFIA 16,000 63 SUFIYANA BEGUM 15,0 00 64 TABASSUM 17,000 65 TABREZ AHMAD 18,000 66 TALAT RAHMAN 18,000 67 TARANNUM KHAN 15,000 68 TARIQ AHMAD 17,000 69 UZMA RASHID 17,000 70 ZARIN KHAN 17,000 71 ZEHRA HABIB 15,000 TOTAL 11,89,000/ - 10 . DESPITE SEVERAL OPPORTUNITIES ALLOWED TO THE ASSESSEE TRUST TO PROVE THE CREDITWORTHINESS OF THE ABOVE CREDITS, THE ASSESSEE COULD NOT PRODUCE PAN, ASSESSMENT DETAILS AND BANK DETAILS OF THE PARTIES AND COULD NOT PRODUCE THE ABOVE PARTIES FOR STATEMENTS. ONLY A WRITTEN REPLY ON PLAIN PAPER IN A GENERAL MANNER WITHOUT ANY SUPPORTING DOCUMENTS REGARD ING AVAILABILITY OF FUNDS, DO NOT CONSTITUTE THE CREDITWORTHINESS OF THE SAID CREDITS. THEREFORE, THE ABOVE CREDIT TOTALING TO RS.11,89,000/ - ITA NO.312 & 313/LKW/201 6 PAGE 9 OF 11 WAS ADDED TO THE TO TAL INCOME OF THE ASSESSEE AS UNEXPLAINED CASH CREDITS U/S 68 OF THE I.T. ACT. THE SOCIETY IS NOT REGISTERED U/S 12A OF THE I.T. ACT, THEREFORE, ITS INCOME WAS ASSESSED IN THE STATUS OF AOP AND TAX WAS CHARGED AT MAXIMUM ON TOTAL INCOME AT MAXIMUM MARGINA L RATE. 11 . BEFORE THE LD. CIT(A), ASSESSEE DID NOT MAKE ANY COMPLIANCE OF NOTICES ISSUED ON DIFFERENT DATES OF HEARING WHICH ARE ON RECORD IN THE ORDER OF THE LD. CIT(A). IT WAS OBSERVED BY THE LD. CIT(A) THAT IT IS AMPLY CLEAR FROM THE ABOVE CHART THAT THE ASSESSEE WILLFULLY HAS NOT MADE COMPLIANCE OF STATUTORY NOTICES ISSUED FOR HEARING FOR THE REASON S BEST KNOWN TO HIM. THE LD. CIT(A) OBSERVED THAT I N VIEW OF THE FACTS OF THE ASSESSEES CASE , IT IS BEYOND DOUBT THAT THE ASSESSEE IS NOT BOTHERED FO R THE FAT E OF THE APPEAL. THE ASSESSEE HAS FILED THE PRESENT APPEAL MERELY TO FILE AN APPEAL. THUS, IT IS OBVIOUS THAT THE ASSESSEE IS NOT INTERESTED IN DISPOSAL OF APPEAL, SINCE ASSESSEE HAS NOTHING TO SAY IN REGARD TO ADDITIONS MADE BY ASSESSING OFFICER . THEREFORE, ALL THE ADDITIONS MADE BY ASSESSING OFFICER I.E. RS. 960/ - + 65S3/ - + 71,000/ - + 66,000 + 11,89,000/ - RESPECTIVELY WERE CONFIRMED BY THE LD. CIT(A) . 12 . AT THE TIME OF HEARING BEFORE US, THE LD. A.R. OF THE ASSESSEE POINTED THAT IN RESPONSE TO NOTI CES UNDER SECTION 133(6), ONLY FOUR PARTIES HAVE NOT ANSWERED , BUT THAT SHOULD NOT MAKE THE ENTIRE DEPOSITS AS NON - GENUINE. THE LD. A.R. OF THE ASSESSEE FURTHER STATED THAT IN MOST OF THE CASES, PARTIES HAVE AGREED THAT THEY HAVE GIVEN DONATION TO THE ASS ESSEE - TRUST AND, THEREFORE, THOSE DONATIONS SHOULD BE ACKNOWLEDGED. THE ASSESSING OFFICER AND THE LD. CIT(A) HAVE ADDED THE ENTIRE AMOUNT, WHICH IS NOT JUSTIFIED. THEREFORE, THE ORDER OF THE LD. CIT(A) MAY BE SET ASIDE AND THE ADDITIONS SO MADE BY THE AS SESSING OFFICER AND CONFIRMED BY THE LD. CIT(A) MAY BE DELETED. ITA NO.312 & 313/LKW/201 6 PAGE 10 OF 11 13 . THE LD. D.R., ON THE OTHER HAND, PLACED RELIANCE UPON THE ORDERS OF TH E AUTHORITIES BELOW AND ARGUED THAT THE ASSESSEE IS NOT VIGILANT ABOUT HIS OWN LITIGATION AND, THEREFORE, BEFORE THE LD. C IT(A) DESPITE SEVERAL OPPORTUNITIES THERE WAS NEITHER ANY COMPLIANCE OF THE NOTICES NOR ANY EXPLANATION WAS FURNISHED BY THE ASSESSEE AS REGARDS THE ADDITIONS MADE BY THE ASSESSING OFFICER. 14 . WE HAVE PERUSED THE CASE RECORDS, HEARD THE RIVAL CONTENTIONS AND TAKING INTO ACCOUNT THE FACTS IN TOTALITY, WE FIND THAT THE MATTER SHOULD BE RESTORED BACK TO THE FILE OF THE ASSESSING OFFICER TO VERIFY IN DETAIL THE FACTUAL POSITION AND GENUINENESS IN THE PRESENT CASE AND TO DECIDE THE ISSUE AFRESH AFTER PROVI DING OPPO RTUNITY OF HEARING TO THE ASSESSEE. WE, THEREFORE, SET ASIDE THE ORDER OF THE LD. CIT(A) AND RESTORE THE MATTER TO THE FILE OF THE ASSESSING OFFICER WITH A DIRECTION TO DECIDE THE MATTER AFRESH AFTER AFFORDING PROPER OPPORTUNITY OF HEARING TO THE ASSESSEE . 15 . FOLLOWING OUR AFORESAID VIEW TAKEN IN ITA NO. 3 12/LKW/2016, THE APPEAL IN ITA NO. 3 13/LKW/2016 IS ALSO RESTORED TO THE FILE OF THE ASSESSING OFFICER TO DECIDE THE MATTER AFRESH AS PER TERMS INDICATED THEREIN. 16 . IN THE RESULT, BOTH THE APPEALS OF THE ASSESSE E ARE ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 12 / 0 3 / 201 8 . SD/ - SD/ - [ T.S. KAPOOR ] [PARTHA SARATHI CHAUDHURY ] ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 12 TH MARCH , 201 8 JJ: 0703 ITA NO.312 & 313/LKW/201 6 PAGE 11 OF 11 COPY FORWARDED TO: 1 . APPELLANT 2 . RESPONDENT 3 . CIT(A) 4 . CIT 5 . DR