Sunil Maria, Ludhiana V. ITO, Ludhiana

ITA 396/CHANDI/2016

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 9957 (ITAT-CHANDIGARH)
• Duration Of Justice: 1 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-05-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2009-2010
• Appeal Filed On: 19-04-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S K MITTALDR
• Assessee Lawyers: PARIKSHIT AGGARA WL
• Keywords: Salary income

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH,CHANDIGARH BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER ITA NO. 396/CHD/2016 ASSESSMENT YEAR : 2009-10 SHRI SUNIL MARIA, VS THE ITO, #86, C/O NORTHLINK FISCAL & WARD 7(3), CAPITAL SERVICE, LUDHIANA. MALL ROAD, LUDHIANA. PAN: AAXPM2719D (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI PARIKSHIT AGGARA WL RESPONDENT BY : SHRI S.K.MITTAL,DR DATE OF HEARING : 18.05.2016 DATE OF PRONOUNCEMENT : 19.05.2016 O R D E R THIS APPEAL BY ASSESSEE HAS BEEN DIRECTED AGAINST THE ORDER OF LD. CIT(APPEALS)-3, CHANDIGARH DATED 08.02.2016 FOR ASSESSMENT YEAR 2009-10, CHALLENGING THE ADDITION OF RS. 4,00,901/- ON ACCOUNT OF CASH DEPOS IT IN THE BANK ACCOUNT. 2. BRIEFLY THE FACTS OF THE CASE ARE THAT ASSESSEE DERIVES INCOME FROM SALARY FROM M/S NORTHLINK FISCA L & CAPITAL SERVICE, LUDHIANA. AS PER INFORMATION AVAI LABLE WITH THE INCOME TAX DEPARTMENT, IT CAME TO THE NOTI CE THAT ASSESSEE HAS SAVING BANK ACCOUNT WITH SOUTH INDIAN BANK LTD., LUDHIANA. THE ASSESSING OFFICER ASKED 2 THE ASSESSEE TO EXPLAIN SOURCE OF THE CASH DEPOSIT IN THIS BANK ACCOUNT AND VIDE ORDER-SHEET, DIRECTED TO EXPL AIN THE SOURCE OF CASH DEPOSIT IN THE BANK ACCOUNT IN R ESPECT OF THE FOLLOWING ENTRIES : I) RS. 8,90,000/- 30.03.2009 II) RS. 11,10,000/- 31.03.2009 III) RS. 4,00,000/- 31.03.2009 IV) RS. 15,00,000/- 31.03.2009 3. THE ASSESSEE EXPLAINED BEFORE ASSESSING OFFICER THAT THE AMOUNT OF RS. 8,90,000/- TRANSFERRED FROM THE ACCOUNT NO. 73.31 BY CHEQUE ON DATED 30.03.2009 AND DEPOSITED IN THE BANK ACCOUNT OF THE ASSESSEE. ON THE SAME DAY, THE AMOUNT OF RS. 8,90,000/- HAS BEEN WITHDRAWN BY CHEQUE NO. 357446, THEN ON 31.03.2009 RS. 11,10,000/- DEPOSITED IN HIS ACCOUNT BY CHEQUE FROM THE SAME PARTY AND SAME AMOUNT WAS WITHDRAWN VIDE CHEQUE NO. 356799. SIMILARLY ASSESSEE DEPOSITED RS . 4 LACS AND RS.15 LACS IN CASH IN THE ACCOUNT AND ASSE SSEE HAD ISSUED AND TRANSFERRED THE AMOUNT OF RS. 15 LAC S TO M/S NORTHLINK FISCAL & CAPITAL SERVICE, LUDHIANA ACCOUNT NO. 73.31. 4. THE ASSESSING OFFICER OBSERVED THAT ASSESSEE MAD E CASH DEPOSIT AND THEN MADE WITHDRAWALS THERE FROM. THIS PRACTICE WAS CARRIED ON BY ASSESSEE THROUGH OU T THE FINANCIAL YEAR. THE EXPLANATION OF THE ASSESSEE WA S NOT ACCEPTED. THE ASSESSING OFFICER FOUND THAT ASSESSE E 3 INTRODUCED CASH IN THE BANK ACCOUNT, SOURCE OF WHIC H IS NOT FULLY EXPLAINED. THE ASSESSING OFFICER, THEREFO RE, CONCLUDED THAT THERE IS A BANK DEPOSIT IN BANK ACCO UNT OF THE ASSESSEE ON 31.03.2009 I.E. NET DEPOSIT AFTE R EXCLUDING DRAWINGS WAS RS. 4,00,901/-. THIS AMOUNT WAS ADDED TO THE INCOME OF THE ASSESSEE. THE ASSES SING OFFICER ALSO OBSERVED THAT ASSESSEE HAS NOT DISCLOS ED THIS BANK ACCOUNT, WHICH CAME TO THE NOTICE OF THE DEPARTMENT LATER ON. 5. THE ASSESSEE CHALLENGED THE ADDITION OF RS. 4,00,901/- BEFORE LD. CIT(APPEALS) AND IT WAS SUBMI TTED THAT ASSESSEE HAS MADE CASH WITHDRAWALS FROM THE BA NK IN A SUM OF RS. 20 LACS ( I.E. RS. 8,90,000/- + RS. 11,10,000/-) AND RS. 19 LACS ( RS. 4 LACS + RS. 15 LACS) HAS BEEN DEPOSITED OUT OF THE CASH WITHDRAWALS. IT WAS FURTHER SUBMITTED THAT ASSESSEE HAS ISSUED CHEQUE O F RS. 15 LACS WHICH IS NOTED IN THE BANK STATEMENT, THERE FORE, ADDITION IS WHOLLY UNJUSTIFIED. IT WAS ALSO SUBMIT TED THAT ADDITION HAS BEEN MADE BY MISTAKE AND WHATEVER CASH HAS BEEN DEPOSITED IS OUT OF THE CASH WITHDRAW AL FROM THE BANK ACCOUNT. THE LD. CIT(APPEALS) CALLED FOR THE REMAND REPORT FROM THE ASSESSING OFFICER AND ULTIMATELY CONFIRMED THE ADDITION AND DISMISSED THE APPEAL OF THE ASSESSEE. 6. I HAVE HEARD LD. REPRESENTATIVES OF BOTH THE PAR TIES AND PERUSED THE MATERIAL ON RECORD. THE ASSESSING 4 OFFICER ASKED FOR THE SOURCE OF THE CASH DEPOSITED IN THE BANK ACCOUNT OF THE ASSESSEE ON 30.03.2009 AND 31.03.2009 IN RESPECT OF FOUR ENTRIES AS MENTIONED ABOVE. THE ASSESSEE EXPLAINED THE SAID ENTRIES AND HAS ALSO FILED COPY OF THE BANK STATEMENTS IN THE PAPER BOOK WHICH REVEALED THAT ON 30.03.2009, RS. 8,90,000/- H AS BEEN CREDITED IN THE BANK ACCOUNT OF THE ASSESSEE THROUGH CHEQUE TRANSFER FROM ACCOUNT NO. 73.31 I.E. OF M/S NORTHLINK FISCAL & CAPITAL SERVICE, LUDHIANA ON THE SAME DAY, THE ASSESSEE HAS WITHDRAWN THE SAME AMOUN T OF RS. 8,90,000/- VIDE CHEQUE NO.357446. SIMILARLY RS. 11,10,000/- WERE DEPOSITED IN THE ACCOUNT OF TH E ASSESSEE THROUGH CHEQUE TRANSFER FROM M/S NORTHLINK FISCAL & CAPITAL SERVICE, LUDHIANA. THE SAME AMOUNT OF RS. 11,10,000/- WAS WITHDRAWN BY ASSESSEE FROM HIS BANK ACCOUNT VIDE CHEQUE NO. 356799. THUS, THE EXPLANATION GIVEN BY ASSESSEE BEFORE AUTHORITIES BE LOW IS SUPPORTED BY THE BANK STATEMENT AND THE ENTRIES CONTAINED THEREON, ASSESSING OFFICER WAS, THEREFORE , NOT JUSTIFIED IN HOLDING THAT ASSESSEE MADE CASH DEPOSI T AND THEN MADE WITHDRAWALS FROM THIS BANK ACCOUNT BECAUS E BOTH THESE TWO ENTRIES ARE CREDIT ENTRIES ON ACCOUN T OF REALIZATION OF THE CHEQUE AMOUNT RECEIVED BY THE ASSESSEE ON TRANSFER FROM M/S NORTHLINK FISCAL & CA PITAL SERVICE, LUDHIANA, THESE ENTRIES, THEREFORE, COULD NOT BE CONSIDERED AS CASH DEPOSIT OR UNDISCLOSED CASH DEPO SIT MADE IN THE BANK ACCOUNT OF THE ASSESSEE. 5 6(I) THE ASSESSEE FURTHER EXPLAINED BEFORE THE AUTHORITIES BELOW THAT ON WITHDRAWING RS. 20 LACS F ROM THE BANK ACCOUNT, THE ASSESSEE MADE RE-DEPOSIT OF R S. 19 LACS I.E. RS. 4 LACS AND RS. 15 LACS IN THE SAME BA NK ACCOUNT ON 31.03.2009. THE ASSESSEE FURTHER EXPLAI NED THAT ON THE SAME DAY, RS. 15 LACS WAS TRANSFERRED T O ACCOUNT NO. 73.31 I.E. OF M/S NORTHLINK FISCAL & CA PITAL SERVICE, LUDHIANA. THE SOURCE OF RE-DEPOSIT OF THE CASH OF RS. 19 LACS IS, THEREFORE, EXPLAINED THROUGH THE WITHDRAWALS MADE FROM THE SAME BANK ACCOUNT IN A SU M OF RS. 20 LACS. THUS, THERE IS NO UNEXPLAINED CASH DEPOSIT IN THE BANK ACCOUNT OF THE ASSESSEE. IT MA Y ALSO BE NOTED HERE THAT THE ASSESSING OFFICER ULTIMATELY DID NOT DISBELIEVE ALL THESE FOUR ENTRIES BECAUSE THE ASSESSING OFFICER MADE ADDITION OF CLOSING BALANCE OF RS. 4,00,901/- IN THE BANK ACCOUNT OF THE ASSESSEE AT THE END OF THE FINANCIAL YEAR WHICH ITSELF COULD NO T BE TREATED AS UNDISCLOSED DEPOSIT OR UNDISCLOSED INCOM E OF THE ASSESSEE. WHEN ASSESSING OFFICER DID NOT DISBE LIEVE THE EXPLANATION OF THE ASSESSEE, THERE WERE NO REAS ONS TO MAKE ADDITION OF THE CLOSING BALANCE IN THE SAME BA NK ACCOUNT. FURTHER, ASSESSING OFFICER NOTED THAT THI S BANK ACCOUNT WAS NOT DISCLOSED TO THE REVENUE DEPARTMENT WHICH CAME TO THE NOTICE OF THE DEPARTMENT LATER ON . THIS FACT IS ALSO INCORRECT BECAUSE THE ASSESSEE HA S FILED COPY OF THE IT RETURN IN THE PAPER BOOK IN WHICH SA ME BANK ACCOUNT HAS BEEN SHOWN IN THE IT RETURN AND INTEREST INCOME HAS BEEN DECLARED AS INCOME FROM O THER 6 SOURCES. THEREFORE, ENTIRE FINDINGS OF THE AUTHOR ITIES BELOW ARE FACTUALLY INCORRECT AND THEREFORE, THERE WAS NO JUSTIFICATION FOR MAKING ANY ADDITION AGAINST THE ASSESSEE. 7. IN VIEW OF THE ABOVE DISCUSSION, I SET ASIDE THE ORDERS OF AUTHORITIES BELOW AND DELETE THE ADDITION OF RS. 4,00,901/-. 8. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED . ORDER PRONOUNCED IN THE OPEN COURT. SD/- (BHAVNESH SAINI) JUDICIAL MEMBER DATED: 19 TH MAY, 2016. POONAM COPY TO: THE APPELLANT, THE RESPONDENT, THE CIT(A), THE CIT, DR ASSISTANT REGISTRAR, ITAT/CHD