DCIT, New Delhi V. Shri Nikhil Nanda, New Delhi

ITA 3644/DEL/2013

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 87088 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 9 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-03-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: E
• Next Hearing Date: 09-03-2015
• Assessment Year: 2009-2010
• Appeal Filed On: 06-06-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: P DAM KANUNJNA
• Assessee Lawyers: V K AGGARWAL

Judgement Text

ITA NO. 3644/ DEL/ 2013 1 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH E , NEW DELHI BEFORE SHRI H.S. SIDHU, JUDICIAL MEMBER AND SHRI T.S. KAPOOR, ACCOUNTANT MEMBER I.T.A.NO. 3644 /DEL/201 3 A.Y. : 200 9 - 10 DCIT, CIRCLE 4 (1), NEW DELHI VS . SRI NIKHIL NANDA, D - 201, DEFENCE COLONY, NEW DELHI (PAN: AACPN9260H) (APPELLANT) (RESPONDENT) DEPARTMENT BY : SH. P. DAM. KANUNJNA, SR. DR ASSESSEE BY : SH. V.K. AGGARWAL, A.R. DATE OF HEARING : 0 9 - 0 3 - 201 5 DATE OF ORDER : 1 8 - 0 3 - 201 5 ORDER PER H.S. SIDHU : J M THE REVENUE HAS FILED THE PRESENT APPEAL AGAINST THE IMPUGNED ORDER DATED 22 / 3 /20 1 2 PASSED BY THE LD. COMMISSIONER OF INCOME TAX (APPEALS) - V III , NEW DELHI FOR THE ASSTT. YEAR 2009 - 10 ON THE FOLLOWING GROUNDS: - 1 . WHETHER IN THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) ERRED IN DELETING THE ADDITION OF RS. 74,95,500/ - OF CASH DEPOSITS ON THE BASIS OF ASSESSEE S VERSION SUBMITTED FOR THE FIRST TIME DURING APPELLATE PROCEEDINGS? 2. WHETHER IN THE FACTS AND CIRCUM STANCES OF THE CASE, THE LD. CIT(A) ERRED IN ADMITTING AND ITA NO. 3644/ DEL/ 2013 2 ACCEPTING THE FRESH SUBMISSION OF THE ASSESSEE REGARDING THE EXPLANATION OF CASH TRANSACTIONS WITHOUT ANY VERIFICATION HIMSELF AND / OR WITHOUT PROVIDING THE AO ANY OPPORTUNITY TO REBUT AS PER THE PROVISION OF RULE 46A? 3. THAT THE ORDER OF THE LD. CIT(A) IS ERRONEOUS AND IS NOT TENABLE ON FACTS AND IN LAW. 4. THAT THE GROUNDS OF APPEAL ARE WITHOUT PREJUDICE TO EACH OTHER. 5. THAT THE APPELLANT CRAVES LEAVE TO ADD, ALTER, AMEND OR FORGO ANY GRO UND(S) OF THE APPEAL RAISED ABOVE AT THE TIME OF HEARING. 2 . THE FACTS NARRATED BY THE REVENUE ARE NOT DISPUTED BY BOTH THE PARTIES, HENCE, NEED NOT TO REPEAT THE SAME HERE FOR THE SAKE OF BREVITY. 3. LD. DR RELIED UPON THE ORDER PASSED BY THE AO AND ALSO REITERATED THE CONTENTIONS RAISED IN THE GROUNDS OF APPEAL. 4 . DURING THE HEARING, LD. COUNSEL FOR THE ASSESSEE STATED THAT LD. CIT(A) IN THE IMPUGNED ORDER HAS DELETED THE ADDITION S IN DISPUTE BY RESPECTFULLY FOLLOWING THE ORDER S OF THE ITAT IN THE CASE OF ACIT VS. BALDEV RAJ CHARLA, 121 TTJ (DEL) 366 AND MOONGIPA INVESTMENT LTD. VS. ITO IN ITA NO. 2605/DEL/2007, HENCE, HE REQUESTED THE ORDER OF THE LD. CIT(A) MAY BE UPHELD. IN SUPPORT OF HIS CONTENTION HE ALSO FILED A PAPER BOOK CONTAINING PAG ES 1 TO 33 HAVING THE COPIES OF THE WRITTEN SUBMISSIONS DATED 26.2.13 AND 14.3.2013 FILED BEFORE THE CIT(A); LEDGER ACCOUNT OF PERSONAL DRAWINGS; SUMMARY OF DRAWINGS; DETAILS OF CASH DEPOSITS AND ITA NO. 3644/ DEL/ 2013 3 WITHDRAWALS FROM THE BANK; COPIES OF BANK ACCOUNTS; WRITT EN SUBMISSIONS DATED NIL FILED BEFORE THE CIT(A) AND LETTER DATED 23.8.2011 FILED BEFORE THE AO. 5 . FIRST WE DEAL GROUND NO. 1 RELATING TO DELETION OF ADDITION OF RS.74,95,500/ - . WE HAVE HEARD BOTH THE COUNSEL AND PERUSED THE RELEVANT RECORDS AVAILABLE WITH US, ESPECIALLY THE ORDER PASSED BY THE LD. CIT(A) AND THE AFORESAID ORDER S OF THE ITAT. WE FIND THAT LD. CIT(A) HAS FOLLOW ED THE ORDER S OF THE ITAT IN THE CASE OF ACIT VS. BALDEV RAJ CHARLA, 121 TTJ (DEL) 366 AND MOONGIPA INVESTMENT LTD. VS. ITO IN ITA NO. 2605/DEL/2007 AND DELETED THE ADDITION IN DISPUTE. WE FIND THAT THE LD. CIT(A) IN THE ASSTT. YEAR IN DISPUTE I.E. 2009 - 10 HAS ADJUDICATED THE ISSUE VIDE HIS ORDER DATED 22 . 3 .201 2 AS UNDER: - I HAVE CONSIDERED THE S UBMISSIO NS OF THE APP ELLANT, FINDINGS OF THE AO AND THE FACTS ON RECORD. PERUSAL OF THE FACTS ON RECORD SHOWS THAT AIR INFORMATION HAD BEEN RECEIVED BY THE AO THAT THE APPELLANT HAD MADE CASH DEPOSIT IN THE BANK. TO VERIFY THE DETAILS OF DEPOSITS IN THE BANK ACCOUNT THE AO CA LLED FOR THE BANK ACCOUNTS OF THE APPELLANT. FROM THE STATEMENTS OF THE BANK DEPOSITS IT WAS OBSERVED BY THE AO THAT THE AP PELLANT HAD MADE CASH DEPOSITS OF RS. 74,95,500 / - IN ITS BANK ACCOUNTS MAINTAINED WITH INDIAN BANK AND CENTURION BANK ON DIFFERENT D ATES. THE APPELLANT HAD SUBMITTED THAT THE DEPOSITS HAD BEEN MADE OUT OF THE CASH WITHDRAWALS FROM ITS VARIOUS BANK ITA NO. 3644/ DEL/ 2013 4 ACCOUNTS. THE AO DID NOT AGREE WITH THE SUBMISSIONS OF THE APPELLANT, AND HAS HELD THAT THE CASH DEPOSITS WERE UNEXPLAINED CASH DEPOSITS AND THEREFORE WERE BEING ADDED TO THE APPELLANT'S INCOME. THE ONLY REASON DISCUSSED BY THE AO IN THE ASSESSMENT ORDER IS THAT WHILE THE APPELLANT HAD MADE MAJOR WITHDRAWALS IN THE MONTH OF JANUARY, 2008, THE DEPOSITS WERE MADE IN THE MONTH OF JUNE, 2008 AND, UPTO MARCH, 2 00 8 AND NO SATISFACTORY REASON COULD BE GIVEN BY THE APPELLANT AS TO WHY SUCH HUGE AMOUNT WERE KEPT AT HOME. IN VIEW OF THE ABOVE, THE AO HAS HELD THAT THE CASH DEPOSITS WERE UNEXPLAINED. PERUSAL OF THE SUBMISSIONS OF THE APPELLANT S HOW THAT T HE APPELLANT HAD MADE CASH WITHDRAWALS OF RS. 51,00, 000 I - ON 01.02.2008 AND OF RS. 20,00,000 / - OF 15.03.2008. I T IS ALSO OBSERVED THAT AGAINST, THE ABOVE WITHDRAWALS DEPOSITS WERE MADE IN THE BANK ACCOUNTS AS UNDER: - 1. 24.06.2008 39,98,800/ - 2. 26.06.2008 1,00,000/ - 3. 27.06.2008 9,00,000/ - 4. 02.07.2008 4.90,000/ - ITA NO. 3644/ DEL/ 2013 5 5. 15.07.2008 3,00,000/ - T OTAL 56,98,800/ - IT IS ALSO OBSERVED THAT THE APPELLANT HAD MADE WITHDRAWALS OF RS. 9.90 LACS ON 25.11.2008, RS. 5.3 LACS ON 26.11.2008, RS. 6.50 LACS ON 17.12.2008 & RS. 2 LACS ON 01.01.2009 AGAINST WHICH CASH DEPOSITS HAD BEEN MADE IN THE BANKS AS UNDER: 1. 23.12.2008 7,96,500 / - 2. 24.12.2008 3,00,000 / - 3. 30.12.2008 10,000 / - 4. 30.03.2009 6,00,000 / - TOTAL 17,06,500/ - THE ABOVE FACTS SHOW THAT THE APPELLANT WITHDREW RS. 71,00,000/ - FROM THE BANK ACCOUNT BETWEEN 01.02.2008 & 15.03.2008 AND DEPOSITED' AND AMOUNT OF RS. 56,98,800 / - BETWEEN 24.06.2008 AND 15.07.2008. IT IS ALSO OBSERVED THAT THE APPELLANT WITHDREW A FURTHER AMOUNT OF RS. 23,70,000 / - BETWEEN 25.11.2008 AND 01.01.2009 AND DEPOSITED CASH IN THE BANK ACCOUNTS OF ITA NO. 3644/ DEL/ 2013 6 RS. 17,06,500/ - BETWEEN 23.12.2008 AND 30.03.2009. THE ABOVE FACTS SHOW THAT THE APPELLANT HAD SUBSTANTIAL CASH WITHDRAWALS FROM ITS BANK ACCOUNTS OUT O F WHICH THE CASH DEPOSITS HAD BEEN MADE IN THE BANK ACCOUNT. THE APPELLANT HAS SUBMITTED THAT WITHDRAWALS HAD BEEN MADE IN CASH SINCE IT WAS INTERESTED IN PURCHASING IMMOVABLE PROPERTIES, BUT SINCE THE DEALS DID NOT MATERIALIZE THEREFORE, THE AMOUNT WAS RE - DEPOSITED IN HIS BANK ACCOUNTS BY WAY OF CASH. PERUSAL OF THE DETAILS FILED BY THE APPELLANT SHOW THAT THE APPELLANT HAD SUBSTANTIAL WITHDRAWALS, BESIDES THE ABOVE MENTIONED WITHDRAWALS OF RS. 94,70,000 / - , WHICH WERE UTILIZED FOR HOUSEHOLD EXPENSES. THE ONLY CONTENTION OF THE AO IS THAT THERE WAS NO JUSTIFICATION FOR KEEPING THE CASH AT HOME AND THERE WAS A TIME GAP BETWEEN THE WITHDRAWALS AND DEPOSITS DOES NOT HOLD GOOD IN VIEW OF THE DECISION OF THE HON'BLE ITAT DELHI IN THE CASE OF ACIT VS. BALDEV RAJ CHARLA 121 TT] (DEL) 366WHREIN IT HAS BEEN HELD AS UNDER: 'WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD AND HAVE GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW. ITA NO. 3644/ DEL/ 2013 7 WE FIND THAT THIS EXPLANATION OF THE ASSESSEE WAS FOUND CORRECT THAT AGAINST THESE FIVE DEPOSITS ON DT. 14TH JUNE, 1996, RS. 31,000; 2 1 ST JULY, 1997, RS. 1,27,000 / - , 18TH SEPT., 1997, RS. 22,000; 4TH OCT., 1997, RS. 26,000 AND ON 7TH NOV., 1997, RS. 52,000 THERE WERE SUFFICIENT CASH WITHDRAWALS FROM AWL AND FROM SBL MAYAPURI, BUT THIS ADDITION HAS BEEN CONFIRMED BY LEARNED CIT(A) ON THE BASIS THAT THERE IS TIME GAP BETWEEN THE ASSESSEE'S WITHDRAWALS FROM HIS OWN PARTNERSHIP MLS AWI OR FROM HIS OWN BANK. THERE IS FINDING RECORDED BY THE LEARNED AO OR BY LEARN ED CIT (A) THAT APART FROM DEPOSITING THESE CASH INTO BANK AS EXPLAINED BY THE ASSESSEE, THERE WAS ANY OTHER USER BY THE ASSESSEE OF THESE AMOUNTS AND IN THE ABSENCE OF THAT, SIMPLY BECAUSE THERE WAS A TIME GAP, THE EXPLANATION OF THE ASSESSEE CANNOT BE RE JECTED AND HENCE THE ADDITION CONFIRMED BY THE LEARNED CIT(A) IS NOT CORRECT. WE, THEREFORE, DELETE THE SAME. THIS GROUND OF THE ASSESSEE IS ALLOWED.' PERUSAL OF THE ABOVE SHOWS THAT THE HON'BLE IT AT HAS CLEARLY HELD THAT SIMPLY BECAUSE THERE WAS A TIME GAP BETWEEN THE CASH WITHDRAWAL AND CASH DEPOSITS IN ITA NO. 3644/ DEL/ 2013 8 BANK THE EXPLANATION OF THE ASSESSEE CANNOT BE REJECTED, UNLESS THERE IS A FINDING THAT THE AMOUNT WAS USED SOMEWHERE ELSE. IN THE INSTANT CASE ALSO IT IS OBSERVED THAT THERE IS NO FINDING OF BY THE AO T HAT THE CASH WITHDRAWALS HAD BEEN USED ANYWHERE ELSE BY THE APPELLANT. MOREOVER, THE APPELLANT HAS ALSO SUBMITTED DETAILS FROM WHICH IT CAN BE OBSERVED THAT THE APPELLANT HAD SUBSTANTIAL WITHDRAWING FOR ITS HOUSEHOLD EXPENSES. THE HON'BLE IT A T DELHI IN THE CASE OF MOONGIPA INVESTMENT LTD. VS. ITO IN ITA NO. 260SIDE1L2007 AFTER PLACING RELIANCE ON THE DECISION IN THE CASE OF BALDEV RAJ CHARLA HAS HELD THAT ADDITION CANNOT BE MADE OR SUSTAINED ON THE BASIS THAT THERE WAS TIME GAP BETWEEN CASH WITHDRAWAL FR OM BANK ACCOUNT AND CASH DEPOSITS IN BANK ACCOUNT. IN VIEW OF THE FINDINGS ABOVE THAT THE APPELLANT HAD SUBSTANTIAL CASH WITHDRAWALS FROM WHICH THE CASH DEPOSITS HAD BEEN MADE IN THE BANK ACCOUNT AND ALSO IN VIEW OF THE FACT THAT THE AO HAS NOT BROUGHT AN Y EVIDENCES ON RECORD TO SHOW THAT THE MONEY WITHDRAWN WAS USED FOR ANY OTHER PURPOSE OTHER THAN BEING RE - ITA NO. 3644/ DEL/ 2013 9 DEPOSITED IN THE BANK ACCOUNT, THE ADDITION MADE BY THE AO CANNOT BE SUSTAINED. RESPECTFULLY FOLLOWING THE DECISION OF THE HON'BLE ITAT DELHI IN THE C ASE OF BALDEV RAJ CHARLA AND ORS. DISCUSSED ABOVE AND OTHER JUDICIAL DECISIONS DISCUSSED ABOVE AND THE FACTS OF THE CASE THE ADDITION MADE BY THE AO IS DELETED. 6 . AFTER GOING THROUGH THE AFORESAID ORDER PASSED BY THE LD. CIT(A) ON THE ISSUE IN DISPUTE AS WELL AS THE JUDICIAL PRECEDENTS OF ITAT RELIED BY HIM, WHILE DELETING THE ADDITION IN DISPUTE, WE ARE OF THE CONSIDERED VIEW THAT THE LD. FIRST APPELLATE AUTHORITY HAS PASSED A WELL REASONED ORDER BY FOLLOWING THE JUDICIAL PRECEDENTS OF ITAT, AS AFORESAID. THEREFORE, W E FIND NO INFIRMITY IN THE ORDER OF THE LD. CIT(A) AND THEREFORE, NO INTERFERE IS REQUIRED ON OUR PART, HENCE, WE UPHOLD THE IMPUGNED ORDER PASSED BY THE LD. CIT(A) ON THIS ISSUE AND DECIDE THE ISSUE AGAINST THE REVENUE. 7 . WITH REGARD TO GROUND NO. 2 REGARDING THE EXPLANATION OF CASH TRA NSACTIONS WITHOUT ANY VERIFICATION HIMSELF AND / OR WITHOUT PROVIDING THE AO ANY OPPORTUNITY TO REBUT AS PER THE PROVISIONS OF RULE 46A IS CONCERNED. WE FIND THAT WITH REGARD TO ISSUE OF DELETION OF ADDITION OF RS. 74,95,500/ - RAISED IN GROUND NO. 1, AS A FORESAID, IS CONCERNED, THE LD. CIT(A) HAS DELETED THE ADDITION OF RS.74,95,500/ - MADE BY THE AO BY FOLLOWING THE ITAT ORDERS IN THE CASE OF ACIT VS. ITA NO. 3644/ DEL/ 2013 10 BALDEV RAJ CHARLA, 121 TTJ (DEL) 366 AND MOONGIPA INVESTMENT LTD. VS. ITO IN ITA NO. 2605/DEL/2007, WHICH WE HAVE ALREADY CONFIRMED, AS AFORESAID. HENCE, THE QUESTION OF PROVIDING AN OPPORTUNITY TO REBUT AS PER THE PROVISION OF RULE 46A IS CONCERNED, DOES NOT ARISE AND AS SUCH IS DISMISSED. THEREFORE, THE GROUND NO. 2 IS DISMISSED. 8 . IN THE RESULT, THE AP PEAL OF THE REVENUE IS DISMISSED. ORDER PRONOUNCED IN THE O PEN C OURT ON 1 8 / 0 3 /20 1 5 . S D / - S D / - [ T.S. KAPOOR ] [ H.S. SIDHU ] ACCOUNTANT MEMBER JUDICIAL MEMBER DATE 1 8 / 0 3 /201 5 SRBHATNAGAR COPY FORWARDED TO: - 1. APPELLANT - 2. RESPONDENT - 3. CIT 4. CIT (A) 5. DR, ITAT TRUE COPY BY ORDER, ASSISTANT REGISTRAR, ITAT, DELHI BENCHES ITA NO. 3644/ DEL/ 2013 11