ROHINI V. KOTHARI, MUMBAI V. ITO 20(2)(4), MUMBAI

ITA 3167/MUM/2012

• Counselvise Citation: 316719914 RSA 2012
• Duration Of Justice: 2 year(s) 3 month(s) 20 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-08-2014
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Next Hearing Date: 17-07-2014
• Assessment Year: 2006-2007
• Appeal Filed On: 08-05-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: JITENDRA SINGH
• Assessee Lawyers: VIKAS KUMAR AGARWAL

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH, MUMBAI BEFORE S/SHRI B.R.BASKARAN (AM) AND SANJAY GARG, (JM) .. , , ./I.T.A. NO.3167/MUM/2012 ( / ASSESSMENT YEAR : 2006-07) SMT.ROHINI V KOTHARI B-42, MONICA APTS.,4 TH FLOOR, J P ROAD, ANDHERI (W), MUMBAI- 400058 / VS. INCOME TAX OFFICER 20(2)(4), MUMBAI. ( !' / APPELLANT) .. ( #$!' / RESPONDENT) ! ./ % ./PAN/GIR NO. :AAPPK0491G !' & / REVENUE BY : S/SHRI K GOPAL AND JITENDRA SINGH #$!' ' & /ASSESSEE BY : SHRI VIKAS KUMAR AGARWAL ( ) ' *+ / DATE OF HEARING : 17.7.2014 ,- ' *+ /DATE OF PRONOUNCEMENT : 28.8.2014 / O R D E R PER B.R.BASKARAN, ACCOUNTANT MEMBER: THE APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAINS T THE ORDER DATED 29.02.2012 PASSED BY LD CIT(A)-31, MUMBAI AND IT RE LATES TO THE ASSESSMENT YEAR 2006-07. 2. THE DECISION TAKEN BY LD CIT(A) ON THE FOLLOWIN G ADDITIONS IS BEING CONTESTED BEFORE US BY THE ASSESSEE. (A) UNEXPLAINED DEPOSITS MADE IN THE BANK ACCOUN T RS.16,20,000/- (B) SALE VALUE OF SECURITIES ASSESSED AS INCOME - RS.13,44,728/- (C) ASSESSMENT OF ALLEGED RECEIPT OF DIVIDEND - RS.25,260/- I.T.A. NO.3167/MUM/2012 2 3. THE FACTS RELATING TO THE CASE ARE STATED IN BR IEF. THE ASSESSEE IS AN INDIVIDUAL AND SHE FILED HER RETURN OF INCOME DECLA RING INCOME OF RS.34,047/- FOR THE YEAR UNDER CONSIDERATION, WHICH CONSISTED OF BA NK INTEREST AND OTHER INTEREST INCOME. THE AO COMPLETED THE ASSESSMENT BY MAKING VARIOUS ADDITIONS, AS THE ASSESSEE COULD NOT PROPERLY EXPLAIN THE SOURCES FOR MAKING DEPOSITS AND ALSO DID NOT EXPLAIN THE DETAILS RELATING TO SHARE TRANSACTI ONS. IT WAS STATED THAT THE BUILDING, WHERE THE ASSESSEES HUSBAND WAS HAVING O FFICE, COLLAPSED AND HENCE ALL THE DETAILS WERE DESTROYED. THE SAID EXPLANATI ON WAS NOT FOUND CONVINCING TO BOTH THE AO AS WELL AS THE LD CIT(A). IN THE APPE AL FILED, THE ASSESSEE COULD GET ONLY PARTIAL RELIEF. STILL AGGRIEVED, THE ASSE SSEE HAS FILED THIS APPEAL BEFORE US. 4. THE FIRST ISSUE RELATES TO THE UNEXPLAINED DEPO SITS MADE IN THE BANK ACCOUNT OF THE ASSESSEE. FROM THE AIR REPORT, THE AO NOTICED THAT THE ASSESSEE HAS DEPOSITED AN AGGREGATE AMOUNT OF RS.16,20,000/- IN THE SB A/C NO.0021000050249 MAINTAINED WITH HDFC BANK. WHEN Q UESTIONED ABOUT THE SOURCES FOR MAKING THE ABOVE SAID DEPOSITS, THE ASS ESSEE EXPLAINED THAT THE CASH WITHDRAWN FROM ANOTHER BANK ACCOUNT, VIZ., LAS 0022 100003072 WAS USED TO MAKE THE ABOVE SAID DEPOSITS. THE AO DID NOT ACCEP T THE SAME HENCE ASSESSED IT AS THE INCOME OF THE ASSESSEE. BEFORE LD CIT(A ), THE ASSESSEE FILED CASH RECONCILIATION STATEMENT, CASH BOOK AND BANK BOOK. HENCE, THE LD CIT(A) CALLED FOR A REMAND REPORT FROM THE AO. IN THE REMAND REP ORT, THE ASSESSING OFFICER REPORTED THAT THE ASSESSEE HAS DEPOSITED AGGREGATE AMOUNT OF RS.18,40,000/- IN THREE BANK ACCOUNTS AND WITHDRAWN AN AGGREGATE AMOU NT OF RS.29,59,000/- FROM THE ABOVE SAID BANK ACCOUNTS. ACCORDINGLY, HE REPORTED THAT THE AGGREGATE I.T.A. NO.3167/MUM/2012 3 WITHDRAWALS WERE MORE THAN THE AGGREGATE AMOUNT OF DEPOSITS. HOWEVER, THE LD CIT(A) EXPRESSED THE VIEW THAT THE EXPLANATION G IVEN BY THE ASSESSEE THAT THE WITHDRAWALS MADE ON AN EARLIER OCCASION WERE US ED TO MAKE DEPOSITS IN FUTURE DATE WAS NOT SUBSTANTIATED. ACCORDINGLY HE CONFIRMED THE ADDITION OF RS.16,20,000/-. 5. WE HAVE HEARD THE RIVAL CONTENTIONS ON THIS IS SUE. IT IS AN ADMITTED FACT THAT THE ASSESSEE COULD NOT FURNISH RELEVANT DETAIL S DURING THE COURSE OF ASSESSMENT PROCEEDINGS ON THE PLEA THAT THE RELEVAN T RECORDS WERE DESTROYED WHEN THE OFFICE BUILDING OF ASSESSEES HUSBAND WAS COLLAPSED. HOWEVER, DURING THE COURSE OF APPELLATE PROCEEDINGS, THE ASSESSEE H AS COLLATED THE CASH TRANSACTIONS MADE IN HER BANK ACCOUNTS AND HAS SHOW N THAT THE SOURCES FOR THE DEPOSITS MADE WERE ACTUALLY THE EARLIER WITHDRAWALS . ACCORDING TO THE ASSESSEE, SHE WAS HAVING POSITIVE CASH BALANCE ON ANY GIVEN D ATE. WE NOTICE THAT THE LD CIT(A) DID NOT EXAMINE THE ABOVE SAID DETAILS. INS TEAD, THE LD CIT(A) WAS NOT CONVINCED WITH THE EXPLANATIONS GIVEN BY THE ASSESS EE WITH REGARD TO THE WITHDRAWALS. IN THE REMAND REPORT, WE NOTICE THAT THE ASSESSING OFFICER HAS GIVEN DETAILS OF AGGREGATE AMOUNT OF DEPOSITS / WIT HDRAWALS. IN OUR VIEW, THE AVAILABILITY OF POSITIVE CASH BALANCE IS TO BE SEEN BY COMBINING THE TRANSACTIONS PERTAINING TO ALL THE THREE BANK ACCOUNTS ALONG WIT H THE CASH BALANCE, ON DAY TO DAY BASIS IN ORDER TO FIND OUT NEGATIVE CASH BALANC E, IF ANY, ON ANY DAY. THE NEGATIVE CASH BALANCE, IF FOUND, MAY BE ASSESSED AS THE INCOME OF THE ASSESSEE. ACCORDINGLY, WE ARE OF THE VIEW THAT THE LD CIT(A) HAS RENDERED HIS DECISION ON THIS ISSUE WITHOUT PROPER EXAMINATION OF FACTS. WE ALSO NOTICE THAT THE REMAND REPORT GIVEN BY THE ASSESSING OFFICER DOES NOT GIVE PROPER DETAILS. ACCORDINGLY, IN I.T.A. NO.3167/MUM/2012 4 OUR VIEW, THIS ISSUE REQUIRES PROPER EXAMINATION AT THE END OF THE ASSESSING OFFICER. ACCORDINGLY, WE SET ASIDE THE ORDER OF LD CIT(A) ON THIS ISSUE AND RESTORE THE SAME TO THE FILE OF THE ASSESSING OFFIC ER WITH THE DIRECTION TO EXAMINE THIS ISSUE AFRESH AND TAKE APPROPRIATE DECISION IN ACCORDANCE WITH THE LAW. THE ASSESSEE IS ALSO DIRECTED TO PREPARE A CONSOLIDATED CASH BOOK CONTAINING ALL CASH AND BANK TRANSACTIONS AND FURNISH THE SAME TO THE A SSESSING OFFICER IN ORDER TO ENABLE HIM TO ADJUDICATE THIS MATTER. 6. THE REMAINING TWO ISSUES, VIZ., ASSESSMENT OF RS.13,44,728/- PERTAINING TO SALE VALUE OF SHARES AND RS.25,260/- PERTAINING TO DIVIDEND INCOME ARISE OUT OF COMMON SET OF FACTS. IN THE RETURN OF INCOME TH E ASSESSEE DECLARED LONG TERM CAPITAL GAIN OF RS.7,98,893/- AND DIVIDEND INC OME OF RS.25,260/-. DURING THE COURSE OF ASSESSMENT PROCEEDING, THE ASSESSEE S UBMITTED THAT THE CAPITAL GAIN AND DIVIDEND INCOME DECLARED BY HER DO NOT BEL ONG TO HER AND IT WAS INADVERTENTLY INCLUDED IN HER RETURN OF INCOME DUE TO WRONG COMPUTER PROCESSING. THE AO DID NOT BELIEVE THE SAID EXPLAN ATION GIVEN BY THE ASSESSEE. THE ASSESSING OFFICER NOTICED THAT THE ASSESSEE HAD SHOWN THE ABOVE SAID LONG TERM CAPITAL GAINS ON SALE OF FIVE TYPES SHARES ON A TOTAL SALE VALUE OF RS.13,44,728/-. THE ASSESSING OFFICER ASSESSED THE ABOVE SAID SALE VALUE AS WELL AS THE DIVIDEND INCOME AS THE INCOME OF THE ASSESSE E UNDER UNDISCLOSED SOURCES. 7. IN THE APPELLATE PROCEEDINGS, THE ASSESSEE FUR NISHED COMPLETE DETAILS OF SHARE TRANSACTIONS. IN THE REMAND REPORT, THE ASSE SSING OFFICER ANALYZED THE SALE TRANSACTIONS DECLARED IN THE ORIGINAL RETURN OF INC OME AND ALSO THE DETAILS THAT WERE FURNISHED BEFORE LD CIT(A) AND LISTED OUT THE DIFFERENCES. ACCORDINGLY THE I.T.A. NO.3167/MUM/2012 5 ASSESSING OFFICER SUBMITTED THAT THE MATTER MAY BE DECIDED ON MERITS. HOWEVER, THE LD CIT(A) CHOSE TO CONFIRM THE ADDITION BY REJE CTING THE EXPLANATIONS GIVEN BY THE ASSESSEE. 8. WE HAVE HEARD THE PARTIES. WE NOTICE THAT THE ASSESSEE, DURING THE COURSE OF APPELLATE PROCEEDINGS BEFORE LD CIT(A), H AS SUBMITTED THE COMPLETE DETAILS RELATING TO HER SHARE TRANSACTIONS. SHE HA S ALSO SUBMITTED THE STATEMENT SHOWING COMPUTATION OF CAPITAL GAINS. IN FACT, ANO THER ADDITION OF RS.17,59,016/- MADE BY THE ASSESSING OFFICER AS THE DIFFERENCE BETWEEN THE PURCHASE VALUE AND SALE VALUE OF SHARE TRANSACTIONS , WAS DELETED BY THE LD CIT(A) ONLY ON THE STRENGTH OF THE DETAILS FURNISHE D BY THE ASSESSEE. WHEN THE ASSESSEE IS CLAIMING THAT THE LONG TERM CAPITAL GAI N AND DIVIDEND INCOME WERE WRONGLY INCLUDED IN HER RETURN OF INCOME AND FURTHE R WHEN SHE HAS SUBSTANTIATED THE SAME BY FURNISHING THE ACTUAL SHARE TRANSACTION S, WE ARE UNABLE TO COMPREHEND AS TO HOW THE LD CIT(A) COULD REJECT THE ABOVE SAID EXPLANATION GIVEN BY THE ASSESSEE THAT TOO, WHEN THE AO HAS ACT UALLY RECONCILED THE DIFFERENCES. IN OUR VIEW, THE ADDITION CONFIRMED B Y THE LD CIT(A) COULD NOT BE SUSTAINED UNLESS AND UNTIL IT IS SHOWN THAT THE FIV E TYPE OF SHARES LISTED OUT BY THE ASSESSING OFFICER WERE ACTUALLY HELD BY THE ASS ESSEE AND ACTUALLY SOLD BY HER. ADMITTEDLY, THE LD CIT(A) DID NOT BRING ANY MATERIA L ON RECORD TO SHOW THAT THE RELEVANT SHARES WERE HELD / SOLD BY HER. ON THE CO NTRARY, THE ASSESSEE HAS FURNISHED ALL THE DETAILS RELATING TO HER SHARE TRA NSACTIONS AND THE LONG TERM CAPITAL GAIN COMPUTED OUT OF THE ABOVE SAID DETAILS WAS ACCEPTED BY THE TAX AUTHORITIES. UNDER THESE CIRCUMSTANCES, IN OUR VIE W, THE LD CIT(A) WAS NOT JUSTIFIED IN CONFIRMING THE ADDITION OF RS.13.44 LA KHS AND RS.25,260/- REFERRED I.T.A. NO.3167/MUM/2012 6 ABOVE. ACCORDINGLY, WE SET ASIDE THE ORDER OF LD C IT(A) IN RESPECT OF THE ABOVE SAID TWO ISSUES AND DIRECT THE AO TO DELETE BOTH TH E ADDITIONS. 9. IN THE RESULT, THE APPEAL FILED BY THE ASSES SEE IS TREATED AS ALLOWED FOR STATISTICAL PURPOSES. THE ABOVE ORDER WAS PRONOUNCED IN THE OPEN COURT ON 28TH AUG, 2014. ,- ( ./ 0 1 28TH AUG, 2014 - ' ) 2 SD SD ( /SANJAY GARG) ( .. / B.R. BASKARAN ) / JUDICIAL MEMBER / ACCOUNTANT MEMBER . ( ) MUMBAI: 28TH AUG,2014. . . ./ SRL , SR. PS ! '#$%& '&($ / COPY OF THE ORDER FORWARDED TO : 1. !' / THE APPELLANT 2. #$ !' / THE RESPONDENT. 3. ( 4* ( ) / THE CIT(A)- CONCERNED 4. ( 4* / CIT CONCERNED 5. 56 #* 7 , + 7 , . ( ) / DR, ITAT, MUMBAI CONCERNED 6. 8) / GUARD FILE. 9 ( / BY ORDER, TRUE COPY : (ASSTT. REGISTRAR) + 7 , . ( ) /ITAT, MUMBAI