YATEEN ANANT PANDIT, MUMBAI V. ACIT 15(2), MUMBAI

ITA 4232/MUM/2014

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 3767 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 10 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-05-2016
• Appeal Filed By: Assessee
• Bench Allotted: G
• Next Hearing Date: 27-04-2016
• Assessment Year: 2010-2011
• Appeal Filed On: 13-06-2014
• Court: TRIBUNAL
• Department Lawyers: S K BEPARI
• Keywords: Source of fund

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL G , BENCH MUMBAI BEFORE SHRI R.C.SHARMA, AM & SHRI SANJAY GARG , JM ./ ITA NO. 4232 / MUM/20 1 4 ( / ASSESSMENT YEAR : 20 10 - 11 ) SHRI YATEE N ANANT PANDIT, 49/1, PUSHPAK, LINKING ROAD, EXTENSION, SANTACRUZ (WEST), MUMBAI - 400054 VS. ACIT - 22(3), MUMBAI ./ ./ PAN/GIR NO. : A MUPP 3004 F ( / APPELLANT ) .. ( / RESPONDENT ) /ASSESSEE BY : SHRI J.P.BAIRAGRA /REVENUE BY : SHRI S .K.BEPARI / DATE OF HEARING : 03 /05/2016 / DATE OF PRONOUNCEMENT 11/05 /201 6 / O R D E R PER R.C.SHARMA (A.M) : THIS IS AN APPEAL FILED BY TH E REVENUE AGAINST THE ORDER OF CIT(A) - MUMBAI, FOR THE ASSESSMENT YEAR 20 10 - 11 . 2. IN THIS APPEAL, THE ASSESSEE IS AGGRIEVED FOR UPHOLDING DISALLOWANCE OF RS. 24 LAKHS U/S.68 REJECTING THE EXPLANATIONS FORWARDED BY THE ASSESSEE WITH REGARD TO THE SOURCE OF R S.24 LAKHS. 3. RIVAL CONTENTIONS HAVE BEEN HEARD AND RECORD PERUSED. FACTS IN BRIEF ARE THAT THE ASSESSEE IS AN INDIVIDUAL, WORKING AS A PILOT FOR KINGFISHER AIRLINES LTD. DURING THE YEAR UNDER CONSIDERATION, THE ASSESSEE HAS DERIVED INCOME FROM SALARIES, OTHER SOURCES & CAPITAL GAINS. TH E ASSESSEE HAS FILED RETURN OF INCOME ON 30.07.2010, DECLARING A TOTAL ITA NO. 4232 /1 4 2 INCOME OF RS.52.01 LACS AS AGAINST WHICH THE ASSESSING OFFICER (AO) HAS ASSESSED THE ASSESSEE 'S INCOME AT RS.75.21 LACS. IN DOING SO, THE AO HAS TAXED A SUM OF RS.24 LACS (BEING CASH) DEPOSITED ON 17.08.2009 IN A BANK ACCOUNT MAINTAI NED WITH STATE BANK OF INDIA, A/C NO.: 10154478793 STANDING IN THE JOINT NAMES OF THE ASSESSEE, HIS FATHER - MR. ANANT GANGARAM PANDIT, MOTHER - MRS. LEENA ANANT PANDIT & HIS BROTHER - MR. RAJESH ANANT PANDIT. THE ASSESSEE HAD EXPLAINED VIDE HIS LETTER DTD.09.01.2013 THAT THE SUM OF RS.24 LACS (CASH DEPOSITED ON 17.08.2009) IN THE SAID BANK ACCOUNT MAINTAINED WITH STATE BANK OF INDIA WAS SOURCED OUT OF SALE OF JEWELLERY MADE BY THE FOLLOWING PERSONS: SR. NO. NAME OF PERSON WEIGHT OF GOLD ORNAMENT SOLD AMOUNT OF CASH (RS.) A) MR. ANANT GANGARAM PANDIT (FATHER OF THE ASSESSEE) 240 GMS. 3,33,800 B) MRS. LEENA ANANT PANDIT (MOTHER OF THE ASSESSEE) 360 GMS. 4,84,200 C) MRS. GULAB SHANKAR PATKAR (GRANDMOTHER OF THE ASSESSEE) 210 GMS. 2,82,450 D) MRS. ANJANA YATIN PANDIT (WIFE OF THE ASSESSEE) 1,500 GMS. 13,05,440 TOTAL. 2,310 GMS. 24,05,850 4. AFFIDAVITS EXPLAINING THE SOURCES OF THE JEWELLERY WERE ALSO FILED BY THE RESPECTI VE PERSONS DURING THE COURSE OF THE ASSESSMENT PROCEEDING BEFORE THE AO, VIDE LETTER DTD.09.01.2013. THE AO IN ORDER TO VERIFY THE GENUINENESS OF THE SALE OF JEWELLERY, DEPUTED HIS INSPECTOR TO VISIT THE SHOWROOM OF 'RAJLAXMI JEWELLERS'. A FIELD VISIT OF T HE INSPECTOR REVEALED THAT THE JEWELER HAD LEFT THE PREMISES, AS STATED IN THE SALE BILL & HAD THEREFORE, NO CLUE IN RESPECT OF THE NEW ADDRESS OF THE JEWELLER. IN THESE CIRCUMSTANCES, THE AO REJECTED THE EXPLANATION OFFERED BY THE ASSESSEE & ITA NO. 4232 /1 4 3 THEREBY, TREA TED THE SUM OF RS.24 LACS AS UNDISCLOSED INCOME U/S.68 OF THE INCOME TAX ACT. 5. BY THE IMPUGNED ORDER, THE CIT(A) CONFIRMED THE ACTION OF THE AO, AGAINST WHICH ASSESSEE IS IN FURTHER APPEAL BEFORE US. 6. LD. AR DREW OUR ATTENTION TO THE FOLLOWING DOCUME NTS PLACED ON RECORD : - I) COPY OF SUMMARY OF BANK ACCOUNT WITH SB.I. BANK, SANTACRUZ (WEST) BRANCH. II) COPIES OF THE BILL FOR SALE OF JEWELLERY BY THE APPELLANT - MR. YATEEN ANANT PANDIT ON 10.08.200 9 FOR RS.10,90,780/ - , BEARING NO .21. III) COPIES OF THE BILL FOR SALE OF JEWELLERY BY MRS. ANJANA YATEEN PANDIT (APPELLANT'S WIFE) ON 11.08.2009 FOR RS.13,05,440/ - , BEARING NO.26. IV) COPY OF THE LETTER DTD.05.12.20 12 FILED BEFORE THE LEARNED AO. V) COPY OF THE LETTER DTD.09.01.2013 FILED BEFORE THE LEARNED AO ALONG WITH THE COPIES OF 6 DECLARATIONS. COPIES OF WHICH ARE ALSO ENCLOSED AS UNDER: A) DEED OF CONFIRMATION FROM SHRI ANANT GANGARAM PANDIT. B) DECLARATION FROM SMT. LEENA ANANT PANDIT. C) DECLARATION FROM MS. GULAB SHANKAR PATKAR. D) DECLARATION FROM SHII ARVIND KUMAR MATHUR AND SMT. ABBA MATHUR. E) DECLARATION FROM ANJANA YATEEN PANDIT GIVING DETAILS OF GOLD & JEWELLERY HOLDING ALONG WITH WEALTH TAX APPLICABILITY. F) DECLARATION FROM YATEEN ANANT PANDIT GIVING DETAILS OF G OLD & JEWELLERY HOLDING ALONG WITH WEALTH TAX APPLICABILITY. IN VIEW OF THE ABOVE, IT WAS CONTENDED BY LD. AR THAT THE ASSESSEE HAS BROUGHT ON RECORDS, ALL THE RELEVANT SUPPORTING, WHICH ARE POSSIBLE & ARE WITHIN HIS CONTROL FOR THE PURPOSE OF ESTABLISHI NG GENUINENESS OF THE TRANSACTION & THE SOURCE OF THE CASH DEPOSIT. THE LEARNED AO HAS NOT IN ANY MANNER REBUTTED THE EVIDENCE PRODUCED BY THE ASSESSEE WITH A COHESIVE COUNTER EVIDENCE NOR HAS HE POINTED OUT ANY LACUNAE IN THE QUALITY OF THE EVIDENCE PRODU CED. JUST BECAUSE THE LEARNED AO ITA NO. 4232 /1 4 4 SUBJECTIVELY THINKS THAT ON THE 'TEST OF HUMAN PROBABILITIES' AND HIS STATEMENT THAT THE GENUINENESS & SOURCE AS 'DOUBTFUL' CANNOT BE AN ADEQUATE BASE FOR SUCH A DISALLOWANCE. IT WAS FURTHER CONTENDED THAT ASSESSEE WANTED URGENTLY TO PAY FOR THE HOUSE AND HE BEING A NON - TECHNICAL PERSON AND THE AMOUNT BEING OF HIGH MAGNITUDE, HE DID NO T TAKE ANY RISK OF CHEQUES OR D /D (WHICH CAN BOUNCE) AND. ACCEPTED THE CASH. THE SUBSEQUENT CHANGE OF PLACE OF BUSINESS BY THE JEWELLER WITHO UT ANY TRACE, PER SE, IS COMPLETELY OUTSIDE CONTROL OF THE ASSESSEE. THE BONAFIDE OF THE CONTENTIONS OF THE ASSESSEE , AS ON THE DATE OF TRANSACTION, IS ESTABLISHED BY THE VAT REGISTRATION DETAILS FROM THE RECORDS WITH GOVERNMENT OF MAHARASHTRA. THUS, YOUR ASSESSEE HAS PROVED THE GENUINENESS OF THE TRANSACTION & BONAFIDE SOURCE OF INVESTMENT WITH DOCUMENTS LIKE BILLS, DECLARATIONS, VAT REGISTRATION CERTIFICATE AND OVERALL EXPLANATION. 7. ON THE OTHER HAND, LD. DR RELIED ON THE ORDER OF LOWER AUTHORITIES AND CONTENDED THAT ASSESSEE COULD NOT PROVE THE SOURCE OF AMOUNT DEPOSITED IN THE BANK ACCOUNT, THEREFORE, THE AO WAS JUSTIFIED IN MAKING THE ADDITION. 8. WE HAVE CONSIDERED RIVAL CONTENTIONS AND CAREFULLY GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW AND F OUND THAT ASSESSEE HAS EXPLAINED SOURCE OF DEPOSIT OUT OF SALE PROCEEDS ON JEWELLERY OWNED BY THE FAMILY MEMBERS. AS THE JEWELLER TO WHOM JEWELLERY WERE SOLD WAS NOT AVAILABLE AT THE TIME OF INSPECTORS VISIT, THE AO DID NOT ACCEPT ASSESSEES CONTENTION AN D ADDED THE AMOUNT AS UNDISCLOSED INCOME OF THE ITA NO. 4232 /1 4 5 ASSESSEE. WE FOUND THAT ALL THE FAMILY MEMBERS HAVE EXPLAINED JEWELLERY BY FILING DECLARATION DULY EXECUTED ON THE STAMP PAPER, WHICH INDICATE THE ITEMS OF JEWELLERY ALONG WITH THEIR WEIGHTS AS POSSESSED BY T HEM AND ITS SALE TO A JEWELLER. THESE FAMILY MEMBERS CONSISTS OF GRANDMOTHER, FATHER, MOTHER, WIFE AND THE ASSESSEE HIMSELF. AS PER CBDT CIRCULAR NO. 1916 DATED 11 TH MAY, 1994 , JEWELLERY UPTO 100 GMS. FOR MALE MEMBER AND 500 GMS. FOR FEMALE MEMBER IN A FAMI LY IS ALLOWED TO BE POSSESSED AND NOT TO BE SEIZED DURING THE COURSE OF SEARCH. VARIOUS COURTS HAVE TAKEN A VIEW THAT THIS CIRCULAR IS ALSO APPLICABLE FOR CONSIDERING THE QUANTUM OF JEWELLERY, WHICH A NORMAL FAMILY MAY POSSESS. CONSIDERING THE TOTALITY OF FACTS AND CIRCUMSTANCES, WE DIRECT THE AO TO ALLOW SOURCE OF FUNDS OUT OF JEWELLERY POSSESSED BY DIFFERENT FAMILY MEMBERS AS PER CBDT CIRCULAR NO. 1916, DATED 11 TH MAY, 1994. ACCORDINGLY JEWELLERY POSSESSED/SOLD BY THEM SUBJECT TO THE MAXIMUM EXTENT OF JEW ELLERY AS PRESCRIBED IN CIRCULAR NO.1916, DATED 11 - 5 - 1994, IS TO BE ALLOWED. NO SALE OF JEWEL LE RY BY ASSESSEE HAD BEEN SHOWN, THEREFORE, BENEFIT OF AFORESAID CBDT CIRCULAR WILL NOT EXTEND TO ASSESSEE HIMSELF. WE DIRECT ACCORDINGLY. 9 . IN THE RESULT, APPEAL OF ASSESSEE IS ALLOWED IN PART. O RDER PRONOUNCED IN THE OPEN COURT ON THIS 11/05 / 201 6 . SD/ - ( SANJAY GARG ) SD/ - ( R.C.SHARMA ) / JUDICIAL MEMBER / ACCOUNTANT MEMBER MUMBAI ; DATED 11/05 /201 6 . . /PKM , . / PS / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE R ESPONDENT. 3. ( ) / THE CIT(A), MUMBAI. ITA NO. 4232 /1 4 6 / BY ORDER, / ( ASSTT. REGISTRAR) , / ITAT, MUMBAI 4. / CIT 5. , , / DR, ITAT, MUMBAI 6. / GUARD FILE. //TRUE COPY//