ITO, Ludhiana V. Lt. Sh. Rajinder Singh, Ludhiana

ITA 339/CHANDI/2014

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 95578 (ITAT-CHANDIGARH)
• Duration Of Justice: 1 year(s) 5 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-09-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 16-09-2015
• Assessment Year: 2006-2007
• Appeal Filed On: 02-04-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S K MITTAL
• Keywords: Additional evidence
• Section: 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL CHANDIGARH BENCHES, CHANDIGARH BEFORE SHRI H.L.KARWA, HON'BLE VICE PRESIDENT & MS. ANNAPURNA MEHROTRA, ACCOUNTANT MEMBER ITA NO. 339/CHD/2014 ASSESSMENT YEAR: 2006-07 THE ITO, VS. LATE SH. RAJINDER SINGH WARD 1(2), THROUGH HIS LEGAL HEIR LUDHIANA SMT. KULWANT KAUR, LUDHIANA PAN NO. ANHPS 1001 M (APPELLANT) (RESPONDENT) APPELLANT BY : SH. S.K. MITTAL RESPONDENT BY : NONE DATE OF HEARING : 16.09.2015 DATE OF PRONOUNCEMENT : 24.09.2015 ORDER PER H.L.KARWA, VP THIS APPEAL FILED BY THE REVENUE IS DIRECTED AGAINS T THE ORDER OF CIT(A)-II, LUDHIANA DATED 10.01.2014 RELATING TO ASSESSMENT Y EAR 2006-07. 2. IN THIS APPEAL THE REVENUE HAS RAISED THE FOLLOW ING GROUNDS:- 1. WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES O F THE CASE AND IN LAW, THE LD. CIT(A) HAS ERRED IN ACCEP TING THE CONTENTION OF THE ASSESSEE AND IGNORING THE FACTS, THEREBY DELETING THE ADDITION OF RS. 6,50,000/- MADE BY TH E ASSESSING OFFICER ON ACCOUNT OF SALE OF TRUCK. 2 2. WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE CA SE AND IN LAW, THE LD. CIT(A) HAS ERRED IN ACCEPTING THE C ONTENTION OF THE ASSESSEE AND IGNORING THE FACTS, THEREBY DELETI NG THE ADDITION UP TO THE EXTENT OF RS. 3,93,000/- MADE BY THE ASSESSING OFFICER ON ACCOUNT OF CASH WITHDRAWN. 3. BRIEFLY STATED, THE FACTS OF THE CASE ARE THAT A SSESSEE SUBMITTED HIS RETURN ON 14.09.2006 DECLARING THE TOTAL INCOME OF RS. 1,3 5,000/-. DURING THE COURSE OF ASSESSMENT PROCEEDINGS IN SPITE OF REPEATED OPPORTU NITIES THERE WAS NO COMPLIANCE ON THE PART OF THE ASSESSEE AS THE ASSES SEE WAS HOSPITALIZED. THE ASSESSING OFFICER ISSUED STATUTORY NOTICES AND QUES TIONNAIRE AND IN RESPONSE TO THE SAME, AUTHORIZED REPRESENTATIVE OF THE ASSESSEE INFORMED THE ASSESSING OFFICER THAT ASSESSEE HAD DIED AND AS SUCH NO INFOR MATION COULD BE PROVIDED. THE ASSESSING OFFICER ACCORDINGLY MADE THE ADDITION OF RS. 14,26,208/-. AS REGARDS THE SOURCE OF EXCESS DEPOSITS IN THE BANK ACCOUNT O F RS. 14,26,208/- THE ASSESSEE FAILED TO PROVE THE SOURCES OF THESE DEPOSITS, THER EFORE, THE ASSESSING OFFICER MADE AN ADDITION OF RS. 14,26,208/- U/S 69A OF THE INCOME-TAX ACT, 1961 (IN SHORT 'THE ACT'). 4. AGGRIEVED BY THE ORDER OF ASSESSING OFFICER, SMT . KULWANT KAUR, LEGAL HEIR OF LATE SHRI RAJINDER SINGH PREFERRED AN APPEAL BEF ORE THE CIT(A). IT WAS STATED THAT THE ASSESSEE HAD SOLD AS TRUCK FOR RS. 6,50,00 0/- AND RECEIVED RS. 3 LAKHS VIDE CHEQUE CREDITED IN THE BANK ACCOUNT ON 1.6.200 5 AND BALANCE AMOUNT IN CASH. IN SUPPORT OF THE ABOVE EXPLANATION FOR THE CREDITS IN THE BANK ACCOUNT THE ASSESSEE FILED AN APPLICATION UNDER RULE 46A OF INC OME TAX RULE, 1962 FOR ADMISSION OF ADDITIONAL EVIDENCE. THE CIT(A) SOUGHT THE COMMENTS OF THE ASSESSING OFFICER AS REGARDS THE ASSESSEES REQUEST FOR ADMISSION OF ADDITIONAL EVIDENCE UNDER RULE 46A. THE ASSESSING OFFICER VIDE HIS REPORT DATED 3.7.2012 SUBMITTED THAT ASSESSEE WAS PREVENTED BY SUFFICIENT CAUSE FOR NOT PROVIDING THE 3 EVIDENCE BEFORE THE THEN ASSESSING OFFICER. ACCORDI NGLY, THE CIT(A) ADMITTED THE ADDITIONAL EVIDENCE. THE CIT(A) ASKED THE ASSESSING OFFICER TO EXAMINE THE ADDITIONAL EVIDENCE AND SUBMIT HIS REPORT IN THE MA TTER. IN HIS REPORT DATED 5.10.2012, THE ASSESSING OFFICER SUBMITTED THAT THE ASSESSEE HAS RAISED FOLLOWING CONTENTION TO JUSTIFY THE SOURCE OF EXCESS DEPOSIT IN THE BANK ACCOUNT AMOUNTING TO RS. 14,26,208/- WHICH ALSO REPRESENT THE ADDITIO NS MADE TO THE INCOME OF THE ASSESSEE FOR THE RELEVANT ASSESSMENT YEAR. 1. SALE OF TRUCK RS. 6,50,000/- 2. CREDIT OF BALANCE CHEQUE RS. 13,495/- RS. 20,500/- 3. OUT OF CASH WITHDRAWN ON 6.1.20006 RS. 1,00,0 00 4. AGRICULTURE INCOME RS. 1,00,500/- 5. OUT OF CASH WITHDRAWN RS. 5,41,713/- RS. 14,26,208/- IN THE REMAND REPORT, THE ASSESSING OFFICER STATED THAT THERE WAS NO MERIT IN THE EXPLANATION OF THE ASSESSEE AND HE REQUESTED TH E CIT(A) TO CONFIRM THE ADDITION. 5. THE LD. CIT(A) ACCEPTED THE EXPLANATION OF THE A SSESSEE REGARDING SOURCE OF DEPOSITS MADE IN THE BANK ACCOUNT OUT OF SALE OF TRUCK FOR RS. 6,50,000/- AND OUT OF CASH WITHDRAWN TO THE EXTENT OF RS. 3,93,000 /- AS AGAINST RS. 5,41,713/- CLAIMED BY THE ASSESSEE. THE RELEVANT FINDINGS OF THE CIT(A) AS AS UNDER:- (I) SALE OF TRUCK RS. 6,50,000/- IN THIS REGARD THE APPELLANT HAD FILED A COPY OF TH E AFFIDAVIT SIGNED BY THE LATE APPELLANT WHEREIN THE APPELLANT CONTENDED THAT 4 HE HAD SOLD HIS TRUCK NO. HR-55-6164 OF ASHOKA LEYL AND 2614 MODEL TO SH. DALJIT SH. MAL SINGH ON 10.04.2005 FOR AN AMOUNT OF RS. 6,50,000/-. THE APPELLANT HAD FURTHER MENTIONED IN THE AFFIDAVIT THAT RS. 3,50,000/- WAS RECEIVED IN CASH AND RS.3 LACS WERE RECEIVED VIDE CHEQUE DATED 21.05.2005. THE AO HAS REJECTED THE APPELLANT'S CONTENTION ON THE FOLLOWI NG TWO GROUNDS:- (A) ON PERUSAL OF THE BANK STATEMENT, NEITHER RS. 3 LACS NOR RS. 3.5 LACS APPEAR ON CREDIT SIDE. (B)IF THE APPELLANT WAS HAVING RS. 6.5 LACS OF FUND S AVAILABLE WITH HIM THERE WOULD HAVE BEEN NO REQUIREMENT OF WI THDRAWAL OF ANY FUNDS SUBSEQUENT TO 21.05,2005 I DO NOT AGREE WITH BOTH THE CONTENTIONS OF THE AO. AS IS EVIDENT FROM THE COPY OF BANK ACCOUNT AND AS POINTED OUT BY THE APPELLANT THERE IS CREDIT ENTRY OF RS. 3 LACS BY CHEQUE IN TH E BANK ACCOUNT ON 01.06.2006. THE CONTENTION OF THE AO THAT RS. 3 LACS DOES NOT APPEAR IN THE BANK STATEMENT IS FACTUALLY INCORRECT . AFTER DEPOSITING RS. 3 LACS, THE FUNDS AVAILABLE WITH THE APPELLANT WERE RS. 3.5 LACS AND NOT RS. 6.5 LACS AS MENTIONED BY T HE AO IN HIS REPORT DATED 05.10.2012. FURTHER, MERELY BECAUSE TH E APPELLANT HAD WITHDRAWN CERTAIN CASH AFTER 21.05.2005 FROM HI S BANK ACCOUNT DOES NOT IMPLY THAT THE AMOUNT OF RS. 3.5 L ACS COULD NOT HAVE BEEN AVAILABLE WITH THE APPELLANT AT THAT TIME . IT IS FOR THE APPELLANT TO DECIDE THE QUANTUM OF FUNDS REQUIRED B Y HIM AT ANY PARTICULAR MOMENT OF TIME. THE APPELLANT, IN THE AF FIDAVIT HAD ALSO SUBMITTED THAT THE AFORESAID VEHICLE WAS REGISTERED IN HIS NAME UPTO 10.04.2005 AND THEREAFTER IT WAS TRANSFERRED I N THE NAME OF SH. DALJIT SINGH. IN CASE THE AO HAD ANY DOUBT ABOU T THE GENUINENESS OF THIS TRANSACTION HE COULD HAVE EASIL Y VERIFIED THE SAME FROM THE RTO OFFICE. THE AO, HOWEVER, CHOSE NO T TO DO SO. COPY OF THE AFFIDAVIT FILED BY THE APPELLANT IS ENC LOSED AS ANNEXURE- A, TO THIS ORDER KEEPING IN VIEW ALL THE AFORESAID FACTS THE SOURCE OF RS. 6,50,000/- ON THIS ACCOUNT IS ACCEPTED. 5 AS REGARDS THE CASH WITHDRAWALS, THE RELEVANT FINDI NGS OF THE CIT(A) ARE AS UNDER:- (V) CASH WITHDRAWN - RS. 5,41,713/- THIS CONTENTION OF THE APPELLANT HAD BEEN REJECTED BY THE AO ON THE GROUND THAT THE ONLY ENTRIES OF CASH DEPOSITS IN TH E BANK ACCOUNT ARE AS UNDER:- 17.09.2005 RS. 500/- 28.10.2005 RS. 7,39,500/- [WHICH IS STATED BY THE ASSESSEE TO BE OUT OF SALE PROCEEDS OF TRUCK AND AGRICULTURAL INCOME.] 16.12.2005 RS. 3,000/- 12.01.2006 RS. 1,00,000/- [CLAIMED BY THE ASSESSEE OUT OF WITHDRAWALS ON 07.01.2006] THE AO HAS OBSERVED THAT IN VIEW OF THE ABOVE THERE ARE NO CASH DEPOSITS IN THE BANK ACCOUNT WHICH CAN BE REGARDED TO BE OUT OF CASH WITHDRAWALS. 1 DO NOT AGREE WITH THE AO'S VIEW ON T HIS ISSUE. OUT OF THE CASH DEPOSIT OF RS. 7,39,500/-ON 28.10.2005 ONL Y RS. 3,50.000 - IS CLAIMED TO BE OUT OF SALE PROCEEDS OF TRUCK, FUR THER, THE APPELLANT'S CONTENTION OF HAVING ANY AGRICULTURAL I NCOME HAS BEEN THEREFORE, PART OF THE CASH DEPOSIT OF RS. 7.39.500 /- CAN BE EXPLAINED TO WITHDRAWALS FROM THE BANK ACCOUNT. ACCORDINGLY, THE FOLLOWING CASH ID TO BE OUT OF CASH WITHDRAWALS FROM THE BANK ACCOUNT:- SR. NO. DATE AMOUNT 1. 17.09.2005 RS. 500/- 2. 28.10.2005 RS. 3,89,500/- 3. 16.12.2005 RS. 3,000/- TOTAL RS. 3,93,000/- 6 THUS, THE APPELLANT'S CONTENTION OF DEPOSITS BEING OUT OF CASH WITHDRAWALS IS ACCEPTED TO THE EXTENT OF RS. 3,89,5 00/-. 6. THE ABOVE APPEAL WAS FIXED FOR HEARING ON 16.9.2 015. NOBODY APPEARED ON BEHALF OF THE ASSESSEE DESPITE SERVICE OF NOTICE. I T APPEARS THAT ASSESSEE IS NOT INTERESTED IN THE MATTER. UNDER THESE CIRCUMSTANCES , WE ARE CONSTRAINED TO DISPOSE OF THE APPEAL OF THE REVENUE, OF COURSE, AFTER HEAR ING LD. DR. 7. WE HAVE HEARD SHRI S.K. MITTAL, LD. DR AND HAVE ALSO PERUSED THE MATERIALS AVAILABLE ON RECORD. IN THIS CASE THE AS SESSING OFFICER FRAMED THE ASSESSMENT U/S 144 OF THE ACT AS THE ASSESSEE HAD D IED DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THEREFORE, NO EXPLANATION R EGARDING SOURCE OF DEPOSITS WERE SUBMITTED BEFORE THE ASSESSING OFFICER. IN OU R OPINION, THE CIT(A) HAS CORRECTLY ADMITTED THE ADDITIONAL EVIDENCE AND IN T HE REMAND REPORT THE ASSESSING OFFICER HIMSELF HAS STATED THAT THE ASSESSEE WAS PR EVENTED BY SUFFICIENT CAUSE FROM PRODUCING THE ADDITIONAL EVIDENCE. IT APPEARS THAT THE ASSESSING OFFICER HAS FRAMED THE ASSESSMENT U/S 144 OF THE ACT WITHOUT VE RIFYING THE TRANSACTIONS AND THE BANK ACCOUNT OF THE ASSESSEE. THE LD. CIT(A) HAS VERIFIED THE BANK ACCOUNT OF THE ASSESSEE AND HE HAS CATEGORICALLY STATED THA T THERE IS CREDIT ENTRY OF RS. 3 LAKHS BY CHEQUE IN THE BANK ACCOUNT ON 1.6.2006. HE HAS FURTHER STATED THAT THE CONTENTION OF THE ASSESSING OFFICER THAT RS. 3 LAKH S DOES NOT APPEAR IN THE BANK STATEMENT IS FULLY INCORRECT. ACCORDING TO LD. CIT( A), AFTER DEPOSIT OF RS. 3 LAKHS, THE FUNDS AVAILABLE WITH THE ASSESSEE WERE RS. 3.5 LAKHS AND NOT RS. 6.5 LAKHS AS STATED BY THE ASSESSING OFFICER IN HIS RE PORT DATED 5.10.2012. ACCORDING TO LD. CIT(A), THE AMOUNT OF RS. 3.5 LAKHS WAS AVAI LABLE WITH THE ASSESSEE. ACCORDING TO LD. CIT(A), THERE WAS AMPLE EVIDENCE O N THE RECORD TO DEMONSTRATE THAT TRUCK WAS SOLD TO SHRI DALJIT SINGH. HE HAS A LSO OBSERVED THAT IN CASE THE 7 ASSESSING OFFICER HAS ANY DOUBT ABOUT THE GENUINEN ESS OF THESE TRANSACTIONS HE COULD HAVE EASILY VERIFIED THE SAME FROM THE RTO OF FICE. IN OUR CONSIDERED VIEW, THE ORDER OF THE CIT(A) IS CORRECT AND BASED ON APP RECIATION OF FACTS AND ALSO EVIDENCE BROUGHT ON RECORD. IN THAT VIEW OF THE M ATTER, WE HOLD THAT CIT(A) WAS FULLY JUSTIFIED IN DELETING THE ADDITION OF RS. 6,5 0,000/-. IT IS ALSO OBSERVED THAT THE ASSESSING OFFICER HAS NOTED IN THE ASSESSMENT ORDER THAT NO CASH DEPOSIT IN THE BANK ACCOUNT CAN BE REGARDED TO BE OUT OF CASH WITHDRAWALS. THE LD. COMMISSIONER HAS ACCEPTED THE WITHDRAWALS OF RS. 3, 93,000/- AS AGAINST RS. 5,41,713/- CLAIMED BY THE ASSESSEE. IN OUR VIEW ,T HE LD. CIT(A) HAS CORRECTLY ACCEPTED THE WITHDRAWALS TO THE EXTENT OF RS. 3,93, 000 ACCORDINGLY WE DO NOT SEE ANY INFIRMITY IN THE ORDER OF LD. CIT(A), THE SAME IS CONFIRMED. 8. IN THE RESULT, THE APPEAL IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 24.09.2015 SD/- SD=- (ANNAPURNA MEHROTRA) (H.L.KARWA) ACCOUNTANT MEMBER VICE PRESIDENT DATED : 24 TH SEPTEMBER, 2015 RKK COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT 4. THE CIT(A) 5. THE DR