Dawesh Bishnoi, Delhi V. Income Tax Ward Int. Tax 1(1)(2) , Delhi

ITA 314/DEL/2022

• Counselvise Citation: [2022] 104 COUNSELVISE.COM (IT) 9671 (ITAT-DELHI)
• Duration Of Justice: 7 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-09-2022
• Appeal Filed By: Assessee
• Order Result: PartlyAllowed
• Bench Allotted: D
• Assessment Year: 2012-2013
• Appeal Filed On: 15-02-2022
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Income from undisclosed sources; Reassessment proceedings; FORM 26AS
• Section: 147; 68; 69; 148; 139; 69A

Judgement Text

I.T.A.No.314/Del/2022 1 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH “D” NEW DELHI BEFORE SHRI G.S. PANNU, HON’BLE PRESIDENT AND SHRI CHALLA NAGENDRA PRASAD, JUDICIAL MEMBER आ .अ.स ं /.I.T.A No.314/Del/2022 /Assessment Year: 2012-13 Dawesh Bishnoi 175 2SF CAT, Sarita Vihar, New Delhi. ब म Vs. Income Tax Officer, Ward Int. Tax 1(1)(2) Delhi. PAN No. AEHPB2402C अ Appellant /Respondent िनधा रतीक ओरसे /Assessee by Ms. Rano Jain, Adv. राज वक ओरसे /Revenue by Shri Sanjay Kumar, Sr. DR स ु नवाईक तारीख/ Date of hearing: 03.08.2022 उ ोषणाक तारीख/Pronouncement on 29.09.2022 आदेश /O R D E R PER C.N. PRASAD, J.M. This appeal is filed by the assessee against the order of Ld. Commissioner of Income Tax (Appeals), Delhi-42 dated 25.01.2022 for the AY 2012-13 in sustaining the addition of Rs.17,42,000/- made u/s 68 of the Act by the Assessing Officer. 2. Briefly stated the facts are that in this case the assessment was reopened u/s 147 of the Act by issue of notice u/s 148 on the basis of the NMS data available on record that the assessee had deposited cash of I.T.A.No.314/Del/2022 2 Rs.17,42,000/- in his savings account held with State Bank of India during the FY 2011-12 relevant to the AY 2012-13 as appearing in Form 26AS. In response to notice dated 29.03.2019 issued u/s 148 of the Act the assessee filed return electronically on 16.04.2019 declaring income of Rs.10,430/- under the head “Income from other sources”. In the course of reassessment proceedings, the Assessing Officer required the assessee to explain the source of cash of Rs.17,42,000/- deposited into his bank account. The assessee furnished reply stating that he is an NRI and during the AY 2011-12 and 2012-13 he stayed in India for a period of 32 days and 14 days respectively. The assessee submitted that the cash of Rs.17,42,000/- deposited into his bank account was from out of withdrawal of Rs.20 lakhs for construction of property in plot No. A-45, Sector-100, Noida and this withdrawal of cash of Rs.20 lakhs was kept with one Shri Shahid Ahmed to be handed over to the builder. However, during the AY 2012-13 Shri Shahid Ahmed re-deposited an amount of Rs.17,42,000/- out of Rs.20 lakhs into bank account of the assessee as the construction contract could not be materialized. However, the AO not convinced with the explanation of the assessee treated Rs.17,42,000/- as unexplained cash deposit u/s 68 of such cash deposits. 3. On appeal the Ld. CIT(Appeals) sustained the addition made by the Assessing Officer observing that the unutilized cash should have been deposited immediately by Shri Shahid Ahmed and not after almost one year. He also observed that the unutilized cash should have been I.T.A.No.314/Del/2022 3 deposited in one go and not in parts on various dates between 29.12.2011 to 07.03.2012. 4. The Ld. Counsel for the assessee submits that the assessee a non- resident individual who left India in 2007 is working in Managerial position outside India. The assessee do not visit India very often and stayed only for few days in India whenever he visits India. The Ld. Counsel submits that during the AY 2011-12 and 2012-13 his total period of stay in India was 32 days and 14 days respectively. Ld. Counsel submits that the only source of income for the assessee in India is interest income and during the assessment year under consideration assessee earned interest of Rs.10,430/- and the assessee did not file return of income as he was not required to file the same as per the provisions of Section 139 of the Act. 5. The Ld. Counsel further submits that the assessee was a co-owner in a plot in Noida, Plot No. G-136, Sector-44, Noida which was sold in the AY 2011-12 and the assessee had received sale proceeds of Rs.31,30,000/- to his share. The Ld. Counsel submits that out of the sale proceeds of Rs.31,30,000/- an amount of Rs.11,36,835/- was utilized for purchase of a new plot, Plot No. 45, Sector 100, Noida and an amount of Rs.20 lakhs was withdrawn from the bank to get the new plot constructed which was intended to be used for rental or other purposes. The Ld. Counsel submits that the said amount of Rs.20 lakhs was kept with one I.T.A.No.314/Del/2022 4 Shri Shahid Ahmed who is the friend of the assessee for the purpose of handing it over the said cash to the contractor who constructs the property in plot no.A-45, Sector-100, Noida which was newly purchased by the assessee. However, since the construction could not happen due to non-habitable condition of Sector-100 as the plan to construct the same had to be postponed by the assessee for some period the assessee requested Shri Shahid Ahmed to return the money. The Ld. Counsel submits that Shri Shahid Ahmed deposited Rs.17,42,000/- into assessee’s bank account and he has also given an affidavit affirming that the assessee had given Rs.20 lakhs to be handed over to the proposed builder, however, due to non-maturity of the proposed construction an amount of Rs.17,42,000/- was deposited into the bank account of the assessee and the balance of Rs.2,58,000/- was given back to the assessee in April, 2012 when the assessee came to India. The Ld. Counsel submits that all this was explained before the lower authorities and furnished copy of affidavit of Shri Shahid Ahmed, copy of passport of the assessee, copy of purchase deed of plot situated in Sector-100, Noida but the authorities below have simply disbelieved the explanation of the assessee on some assumptions and conjectures. 6. The Ld. Counsel for the assessee placing reliance on the decision of the Coordinate Bench of the Tribunal in the case of ITO vs. Deepali Sehgal (ITA No. 5660/Del/2012 dated 05.09.2014) submits that the Tribunal held that merely because there was a time gap between the I.T.A.No.314/Del/2022 5 withdrawal of cash and its further deposit into the bank account the amount cannot be treated as income from undisclosed sources u/s 69 of the Act in the hands of the assessee. Ld. Counsel also placed reliance on the coordinate bench decision of the Delhi Bench in the case of Neeta Breja vs. ITO (ITA No. 524/Del/2017 dated 25.11.2019) for the above said proposition. The Ld. Counsel further placing reliance on the decision of Hon’ble Delhi High Court in the case of Jaya Aggarwal vs. ITO (254 Taxman 398) submits that the Hon’ble High Court held that the explanation offered should be accepted unless there was justification and ground to hold to the contrary. 7. The Ld. DR strongly supported the orders of the authorities below. 8. Heard rival submissions, perused the orders of the authorities below the record placed before us and the case laws relied upon. The Assessing Officer did not dispute that the assessee is an NRI and during the assessment years 2011-12 and 2012-13 assessee stayed in India only for 32 days and 14 days respectively. The Assessing Officer also did not dispute the fact that assessee sold his property situated at plot no. G- 136, Sector-44, Noida and received sale consideration of Rs.31,30,000/- and part of sale consideration of Rs.11,36,835/- was utilized for purchase of new plot no. A-45, Sector-100, Noida. It is also not in dispute that the assessee withdrew Rs.20 lakhs from out of sale consideration. It is the contention of the assessee that this amount of Rs.20 lakhs which was I.T.A.No.314/Del/2022 6 withdrawn was kept with one of his friend Shri Shahid Ahmed for construction of property in the plot purchased by the assessee and since the construction could not materialize Shri Shahid Ahmed deposited Rs.17,42,000/- out of Rs.20 lakhs into the bank account of the assessee. The assessee also furnished affidavit of Shri Shahid Ahmed who deposed that he had received Rs.20 lakhs and also deposited Rs.17,42,000/- into the bank account of the assessee. The contents of the affidavit were not doubted by the Assessing Officer. It is also not in dispute that the assessee does not have any source of income in India other than interest income of Rs.10,430/- during the AY 2012-13. The Ld. CIT(A) sustained the addition observing that there is time gap of more than one year from the date of withdrawal of amount and Shri Shahid Ahmed could have deposited immediately. The explanation given by the assessee is a plausible explanation and the AO could not find any fault with the explanation given by the assessee. The evidences in this case clearly show that the assessee hardly stayed in India during the assessment years 2011-12 and 2012-13 and the explanation of the assessee that the proposed construction of property in the new plot could not materialize cannot be doubted. The observations of the Ld.CIT(A) in sustaining the addition is merely an assumption. The Appellate Authorities cannot assume what the assessee should have been done rather they should appreciate the evidences on record and what the assessee has really done. The explanation of the assessee should be accepted unless if there I.T.A.No.314/Del/2022 7 is any evidence to controvert the explanation given by the assessee. Nothing was brought on record by the Revenue to controvert and prove the explanation of the assessee as false. 9. In the case of ITO vs. Deepali Sehgal (supra) the Tribunal held as under: “Merely because there was a time gap between withdrawal of cash and its further deposit to the bank account, the amount cannot be treated as income from undisclosed sources u/s 69 of the Act in the hands of the assessee.” 10. In the case of Neeta Breja Vs. ITO (supra) the Tribunal held as under: “12. In the present case also the Ld. Assessing Officer or the Ld. CIT(A) did not show that above cash was not available in the hands of the assessee or have been spent on any other purposes. Further the coordinate bench in ACIT vs. Baldev Raj Charla 121 TTJ 366 (Delhi) also held that merely because there was a time gap between withdrawal of cash and cash deposits explanation of the assessee could not be rejected and addition on account of cash deposit could not be made particularly when there was no finding recorded by the Assessing Officer or the Commissioner that apart from depositing this cash into bank as explained by the assessee, there was any other purposes it is used by the assessee of these amounts. In view of above facts, the ground number 1 of the appeal of the assessee is allowed and orders of lower authorities are reversed.” 11. In view of the above, we hold that the explanation of the assessee is a plausible explanation and in the absence of any evidence to the contrary the authorities below are not justified in not accepting such I.T.A.No.314/Del/2022 8 explanation. Thus, we hold that the addition made u/s 68 of the Act which was sustained by Ld.CIT(A) u/s 69A of the Act in this case is unsustainable. The Assessing Officer is directed to delete the addition made u/s 68/69A of the Act. The ground of appeal No. 7(i) and (ii) is allowed. 12. Even though the assessee raised number of grounds in his appeal on technicalities, none of these grounds were argued before us except ground No. 7(i) and (ii) which is on merits of the addition made u/s 68/69A of the Act.. Therefore, all other grounds except ground No. 7(i) and 7(ii) are dismissed as not pressed and argued. 13. In the result, the appeal of the assessee is partly allowed as indicated above. Order pronounced in the open court on 29/09/2022 Sd/- Sd/- (G.S. PANNU) (C.N. PRASAD) PRESIDENT JUDICIAL MEMBER Dated: 29.09.2022 *Kavita Arora, Sr. P.S. Copy of order sent to- Assessee/AO/Pr. CIT/ CIT (A)/ ITAT (DR)/Guard file of ITAT. By order Assistant Registrar, ITAT: Delhi Benches-Delhi