Kanduri Maruthi Shetty, Bellary V. The Income Tax Officer, Ward-1 & TPS, Bellary

ITA 371/BANG/2021

• Counselvise Citation: [2021] 107 COUNSELVISE.COM (IT) 5734 (ITAT-BANGALORE)
• Duration Of Justice: 1 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-09-2021
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: C
• Next Hearing Date: 14-09-2021
• Assessment Year: 2017-2018
• Appeal Filed On: 28-07-2021
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Keywords: Salary income; Source of fund; Condonation of delay
• Section: 143(3); 143(2); 69A

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL BANGALORE SMC-C BENCH, BANGALORE BEFORE SHRI GEORGE GEORGE K, JUDICIAL MEMBER ITA NO.371/BANG/2021: ASST.YEAR 2017-2018 SHRI KANDURI MARUTHI SHETTY DOOR NO.73, WARD NO.11, OPP : BIG VEGETABLE MARKET CAR STREET, BELLARY 583 101 KARNATAKA. PAN : ARMPM2858D. V. THE INCOME TAX OFFICER WARD 1 & TPS BELLARY. (APPELLANT) (RESPONDENT) APPELLANT BY : SRI.SIVAPRASAD REDDY RESPONDENT BY : SRI.GANESH R.GHALE, STANDING COUNSEL DATE OF HEARING : 14.09.2021 DATE OF PRONOUNCEMENT : 20.09.2021 O R D E R THIS APPEAL AT THE INSTANCE OF THE ASSESSEE IS DIRECTED AGAINST THE CIT(A)S ORDER DATED 16.04.2021. THE RELEVANT ASSESSMENT YEAR IS 2017-2018. 2. THE ASSESSEE HAS FILED A PETITION FOR CONDONATION OF DELAY. THE CIT(A)S ORDER IS DATED 16.04.2021. THEREFORE, IN THE NORMAL CIRCUMSTANCES, THE APPEAL OUGHT TO HAVE BEEN FILED BEFORE THE ITAT ON OR BEFORE 15.06.2021. HOWEVER, THE APPEAL HAS BEEN FILED BEFORE THE ITAT ON 19.07.2021. THERE WAS A LOCKDOWN THROUGH OUT THE STATE OF KARNATAKA DURING THE PERIOD MARCH 2021 ON ACCOUNT OF COVID-19 PANDEMIC. THE HONBLE SUPREME COURT HAD EXTENDED THE TIMELINES FROM TIME TO TIME UNDER VARIOUS ACTS IN VIEW THE SAID PANDEMIC. THE CBDT IN CIRCULAR NO.10 OF 2021 DATED 25.05.2021 HAD ALSO COMMUNICATED TIME LINES FOR FILING APPEALS TO THE CIT(A) ALSO STANDS EXTENDED. IN SUCH CIRCUMSTANCES, THERE IS NO DELAY IN ITA NO.371/BANG/2021. SHRI KANDURI MARUTHI SHETTY. 2 FILING THIS APPEAL. THE APPLICATION FOR CONDONATION OF DELAY FILED BY THE ASSESSEE IS ONLY AS A MATTER OF ABUNDANT CAUTION. THEREFORE, I PROCEED TO DISPOSE OF THE APPEAL ON MERITS. 3. THE SOLITARY ISSUE RAISED IS WHETHER THE CIT(A) IS JUSTIFIED IN CONFIRMING THE ADDITION MADE BY THE ASSESSING OFFICER U/S 69A R.W.S. 115BBE OF THE I.T.ACT TO THE EXTENT OF RS.7.5 LAKH BEING CASH DEPOSITS IN BANK ACCOUNT (THE ASSESSING OFFICER HAD MADE AN ADDITION OF RS.9 LAKH). 4. THE BRIEF FACTS OF THE CASE ARE AS FOLLOWS:- THE ASSESSEE HAD DEPOSITED AN AMOUNT OF RS.9 LAKH ON 13.11.2016 DURING THE DEMONETISATION PERIOD IN HIS BANK ACCOUNT MAINTAINED IN UNION BANK OF INDIA (UBI). THE ASSESSEE WAS ASKED TO EXPLAIN THE SOURCE OF ABOVE MENTIONED CASH DEPOSIT. THE ASSESSEE SUBMITTED THAT HE IS A SALARIED EMPLOYEE IN A PRIVATE SECTOR WITH NO OTHER SOURCES OF INCOME, AS SUCH THERE IS NO QUESTION OF EARNING OF ANY UNDISCLOSED INCOME. FURTHER, IT WAS STATED THAT THE ASSESSEE HAS MADE WITHDRAWALS OF RS.18,21,700 FROM 01.04.2013 TO 06.11.2013 AND THE DEPOSIT OF RS. 9 LAKH MADE OUT OF SAVINGS / BALANCE AVAILABLE OUT OF THE WITHDRAWALS. IT HAS FURTHER STATED THAT THE ASSESSEES GRANDMOTHER WAS SUFFERING FROM CANCER AND CASH WAS KEPT FOR HER EMERGENCY MEDICAL TREATMENT. THE ASSESSEE ALSO FILED CASH BOOK AND CASH FLOW STATEMENT BEFORE THE ASSESSING OFFICER. THE CONTENTIONS RAISED BY THE ASSESSEE WAS REJECTED BY THE ASSESSING OFFICER VIDE ASSESSMENT ORDER DATED 27.07.2019 PASSED U/S 143(3) OF THE I.T.ACT. THE A.O. MADE AN ADDITION OF RS.9 LAKH U/S 69A R.W.S. 115BBE OF THE I.T.ACT. ITA NO.371/BANG/2021. SHRI KANDURI MARUTHI SHETTY. 3 5. AGGRIEVED BY THE ADDITION OF RS.9 LAKH, THE ASSESSEE PREFERRED AN APPEAL TO THE FIRST APPELLATE AUTHORITY. THE CIT(A) PARTLY ALLOWED THE APPEAL OF THE ASSESSEE. THE CIT(A) GRANTED RELIEF OF RS.1,50,000 AND SUSTAINED THE ADDITION OF RS.7,50,000. 6. AGGRIEVED BY THE CIT(A)S ORDER, THE ASSESSEE HAS FILED THIS APPEAL BEFORE THE TRIBUNAL. THE LEARNED AR HAS FILED A PAPER BOOK ENCLOSING THEREIN THE CASH FLOW STATEMENT AND CASH BOOK AND THE CASE LAWS RELIED ON. THE LEARNED AR ON MERITS REITERATED THE SUBMISSIONS MADE BEFORE THE INCOME TAX AUTHORITIES. 7. THE LEARNED STANDING COUNSEL, ON THE OTHER HAND, SUPPORTED THE ORDER OF THE CIT(A). 8. I HAVE HEARD RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD. THE ASSESSEE HAS RAISED A GROUND STATING THAT THE ORDER OF ASSESSMENT IS BAD IN LAW, SINCE NOTICE U/S 143(2) OF THE I.T.ACT WAS ISSUED BY THE WRONG ASSESSING OFFICER. HOWEVER, DURING THE COURSE OF HEARING, NO CONTENTION WITH REGARD TO THE ABOVE SAID ISSUE WAS RAISED, HENCE, THE GROUND RELATING TO THE TECHNICAL ISSUE THAT NO NOTICE U/S 143(2) WAS ISSUED BY THE CORRECT ASSESSING OFFICER IS REJECTED. 8.1 AS REGARDS THE ISSUE ON MERITS, IT IS NOT DISPUTED THAT THE ONLY SOURCE OF INCOME FOR ASSESSEE IS SALARY INCOME. IT IS ALSO A FACT THAT THERE WAS NO UNEXPLAINED ASSET OR INVESTMENT UNEARTHED BY THE DEPARTMENT. THE ASSESSEE HAD FILED CASH FLOW STATEMENT AND ALSO CASH BOOK FOR THE PERIOD 01.04.2013 TO 13.11.2016 BEFORE THE A.O. IT IS AN ADMITTED FACT THAT THE ITA NO.371/BANG/2021. SHRI KANDURI MARUTHI SHETTY. 4 ASSESSEES GRANDMOTHER IS SUFFERING FROM CANCER. EVIDENCE FOR THE CANCER TREATMENT FOR ASSESSEES GRANDMOTHER IS PLACED ON RECORD. I AM OF THE VIEW THAT IN ALL PROBABILITIES, SOME AMOUNT OF CASH WOULD HAVE BEEN KEPT BY THE ASSESSEE TO MEET THE MEDICAL EMERGENCIES. IN FACTS OF THE CASE, THE CREDIT OF RS.1,50,000 GIVEN BY THE CIT(A) IS INSUFFICIENT. I DIRECT THE ASSESSING OFFICER TO GRANT A FURTHER CREDIT FOR A SUM OF RS.3.5 LAKH BEING CASH DEPOSIT OUT OF PAST WITHDRAWALS. IN OTHER WORDS, THE A.O. IS DIRECTED TO TAX U/S 69A R.W.S. 115BBE OF THE I.T.ACT, A SUM OF RS.4 LAKH. THEREFORE, THE SUM OF RS.5 LAKH IS TREATED AS EXPLAINED BEING CASH DEPOSIT OUT OF WITHDRAWALS MADE IN THE PAST. IT IS ORDERED ACCORDINGLY. 9. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS PARTLY ALLOWED. ORDER PRONOUNCED ON THIS 20 TH DAY OF SEPTEMBER, 2021 . SD/- ( GEORGE GEORGE K ) JUDICIAL MEMBER BANGALORE; DATED : 20 TH SEPTEMBER, 2021. DEVADAS G* COPY TO : 1. THE APPELLANT. 2. THE RESPONDENT. 3. THE CIT(A)-NFC, DELHI 4. THE PR.CIT BANGALORE. 5. THE DR, ITAT, BENGALURU. 6. GUARD FILE. ASST.REGISTRAR/ITAT, BANGALORE