ITO, Meerut V. Sh. Hari Om Agarwal, Meerut

ITA 4279/DEL/2012

• Counselvise Citation: [2014] 120 COUNSELVISE.COM (IT) 7333 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-09-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Next Hearing Date: 04-03-2014
• Assessment Year: 2007-2008
• Appeal Filed On: 07-08-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SATPAL SINGH
• Keywords: Unexplained cash credit; Gift; Depreciation; Business expenditure; Source of fund
• Section: 143(3); 154

Judgement Text

INCOME TAX APPELLATE TRIBUNAL DELHI BENCH C : NEW DELHI BEFORE SHRI B.C.MEENA , ACCOUNTANT MEMBER AND SHRI A. T. VARKEY, JUDICIAL MEMBER ITA NO. 4279 /DEL/ 2012 (ASSESSMENT YEAR: 2007 - 08 ) ITO WARD - 1(3), MEERUT VS. SH. HARI OM AGARWAL H. NO. 6, NEHRU NAGAR MEERUT. (APPELLANT) (RESPONDENT) APPELLANT BY : SH. SATPAL SINGH, SR. DR RESPONDENT BY : SH. K. SAMPATH , A DV , O R D E R PER A. T. VARKEY , JUDICIAL MEMBER THIS IS AN APPEAL PREFERRED BY THE REVENUE AGAINST THE ORDER OF THE LD CIT(A), MEERUT DATED 08.05.2012 FOR THE ASSESSMENT YEAR 2007 - 08. 2. THE GROUND S OF APPEAL ARE AS FOLLOWS: - 1. WHETHER IN THE FACTS AND CIRCUMSTANCES OF THE CASE, TH E LD COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED IN LAW IN DELETING THE ADDITION OF RS.13,59,347/ - MADE BY THE AO ON AC/ OF UNEXPLAINED CREDITS ON THE BASIS OF WITHDRAWALS FROM FIRM AND BANKS BUT IGNORING THE PAYMENTS AND INVESTMENT MADE BY THE ASSESSEE AND WITHOUT POINTING OUT ANY DEFICIENCY IN AOS WORKING ESTABLISHING THE CLOSING BALANCE AS UNEXPLAINED AFTER DUE REBUTTAL OF ASSESSEES ARGUMENTS. 2. WHETHER IN THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD COMMISSIONER OF INCOME TAX (APPEALS) HAS ERR ED IN LAW IN DELETING THE ADDITION OF RS.1,02,693/ - MADE BY THE AO ON A/C OF DISALLOWANCES OF EXPENSES WITHOUT ANY COGENT REASONS AND IGNORING THAT ASSESSEE COMPLETELY FAILED TO DISCHARGE HIS ONUS IN RESPECT OF PROVING THE GENUINENESS OF EXPENSES BY PRODUC TION OF BOOKS OF A/C, BILLS, VOUCHERS, BANK STATEMENTS ETC. 3. WHETHER IN THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD COMMISSIONER OF INCOME TAX (APPEAL) HAS ERRED IN LAW IN DELETING THE ADDITION OF RS.1,02,000/ - MADE BY THE AO ON A/C OF LOW HOUSE HOL D WITHDRAWALS WITHOUT POINTING OUT ANY DEFICIENCY IN WORKING OF TOTAL HOUSE HOLD WITHDRAW ALS AT RS.1,92,000/ - BY THE AO. PAGE NO. 2 3. APROPOS GROUND NO.1 DELETION OF ADDITION OF RS.13,59,347/ - MADE ON ACCOUNT OF UNEXPLAINED CREDITS. 4. BRIEF FACTS OF THE CASE IS THAT THE ASSESSEE HAS BEEN CARRYING ON MONEY LENDING BUSINESS. DURING THE CURRENT ASSESSMENT YEAR THE ASSESSEE HAS SHOWN NET INCOME OF RS.85,000/ - . THE AO AFTER PERUSAL OF THE STATEMENT OF AFFAIRS FOR THE RELEVANT ASSESSMENT FILE D BY THE ASSESSEE NOTICED THAT THE ASSESSEE HAD SHOWN THE FOLLOWING CLOSING BALANCE OF ASSETS SIDE BESIDES ALL OTHER CLOSING BALANCE : - A. Y. 2007 - 08 A. Y. 2006 - 07 UCO BANK 6102.00 NIL ADVANCES 400000.00 NIL CASH ADVANCES AND STATE BANK OF PATIALA 13 59347.00 370911.00 5. ON QUERY THE ASSESSEE SUBMITTED THAT THE HE HAD MAINTAINED ONLY ONE BANK ACCOUNT NO.21563 AT UCO BANK IN WHICH THE ASSESSEE HAD CLOSING BALANCE OF RS.6 , 102/ - . FURTHER IT WAS SUBMITTED THAT THE ASSESSEE WAS NOT MAINTAINING ANY OTHER BANK ACCOUNT AT THE UCO BANK. IT WAS ALSO STATED THAT THE CASH ADVANCE AND UCO BANK REFLECTED IN WRITTEN STATEMENT OF AFFAIRS AS SHOWN ABOVE WAS CLERICAL MISTAKE ; AND THE ADVANCE S OF RS.4,00,000/ - WAS INFACT THE AMOUNT O N WHICH THE ASSESSEE HAD EARNED INTEREST INCOME OF RS.85,000/ - . IT WAS ALSO SUBMITTED THAT THIS AMOUNT WAS INVESTED IN MONEY LENDING BUSINESS. THE ASSESSEE EXPLAINED THAT THE AMOUNT OF RS.13,59,347/ - WAS THE AMOUNT THAT STOOD AS CASH IN HAND IN HAND AS ON 31.03.2007 AND THE BIFURCATION AND THE SOURCE OF THIS AMOUNT WAS ALSO GIVEN AS UNDER: - RS.8,69,247/ - WITHDRAWALS FROM THE FIRM M/S. APPROVE DEVELOPER IN WHICH ASSESSEE IS A PARTNER. RS3,70,184/ - OLD CASH IN HAND S HOWN AS ON 31.03.2006 IN STATEMENT OF AFFAIRS FOR A.Y. 2006 - 07. RS.1,19,916/ - CASH BALANCE OUT OF CURRENT YEARS INCOME. RS.13,59,347/ - TOTAL 6. THE ASSESSEE HAS ALSO BROUGHT TO THE KNOWLEDGE OF THE AO THAT HE HAD BEC O ME A PARTNER IN M/S. SHARDA ESTATE PROMOT E RS AND HIS INVESTMENT IN THE FINANCIAL YEAR 2005 - 06 WAS RS. 9,33,133/ - ; AND IN THE NEXT FINANCIAL YEAR 2006 - 07 THE ASSESSEE HAD WITHDRAWN AN AMOUNT OF RS.8,69,247/ - WHICH WAS EXPLAINED BY THE ASSESSEE AS CASH IN HAND IN THE FINANCIAL YEAR AS ON 31.03.2007. HOWEVER, THE AO TOOK NOTICE OF THE COPY OF THE BANK ACCOUNT OF THE ASSESSEE IN THE FIRM FOR ASSESSMENT YEAR 2006 - 07 THAT THE ASSESSEE HAD MADE THE FOLLOWING WITHDRAWAL S FROM THE FIRM AS UNDER: - PAGE NO. 3 BY CHEQUE ON 26.04.2006 RS.5,75,000/ - BY CH EQUE ON 05.06.2006 1,05,000/ - BY CHEQUE ON 20.11.2006 2,00,000/ - 8,80,000/ - 7. THE AO COMPARED THE S AME WITH THE BANK ACCOUNT MAINTAINED BY THE ASSESSEE AND NOTICED THAT THE ASSESSEE HAD DEPOSITED THE ABOVE AMOUNT IN BANK ACCOUNT NO.21563 AT UCO BANK AND IT WAS ALSO OBSERVED BY THE AO THAT BOTH THE CHEQUES WERE DEPOSITED AND CASH WAS WITHDRAWN ON DIFFERENT DATES. IT WAS ALSO OBSERVED THAT CASH WITHDRAWAL OF RS.2,00,000/ - WAS SHOWN AS D EPOSIT ON 20.112006 , ALONGWITH OTHER RS.1,00,000/ - I . E. T HE ASSESSEE HAD MADE CASH DEPOSIT RS. 3,00,000/ - ON 20.11.2006 AND MADE PAYMENT THROUGH THREE CHEQUES OF RS.1,00,000/ - EACH TO PURCHASE A PLOT AT GANGA NAGAR, MEERUT TO THREE DIFFERENT PERSONS. THE AO FURTHER NOTICE D THAT THE ASSESSEE HAS MADE WITHDRAWAL OF RS.8,80,000/ - , AND THE ASSESSEE AS PER RECORDS HAD PAID RS.2,00,000/ - TO DIFFERENT PARTIES FOR PURCHASE OF LAND ; AND THEREFORE THE AO WONDERED HOW THE ASSESSEE HAD RS.8,69,247/ - AS CASH IN HAND FROM THE WITHDRAWALS FROM THE FIRM M/S SHARDA ESTATE DEVELOPERS, MEERUT. 8. THE AO ALSO OBSERVED THAT AFTER PERUSING THE RECORD HE FOUND THAT THE CASH BALANCE OF RS.1,19,916/ - AND ALSO OBSERVED THAT THE ASSESSEE HAD RECEIVED CASH RECEIPTS AS PER RECORDS DURING THE YEAR AS UNDER: - RS.10,90,307/ - COMMISSION INCOME RS.85,000/ - INTEREST INCOME RS.11,000/ - GIFT SURRENDERED RS.2,05,307/ - RS.12132/ - PROFIT FROM FIRM M/S. SHARDA ESTATE DEVELOPERS, WHICH STOOD REMAIN CREDITED IN HIS ACCOUNT AS CAPITAL BALANCE. 9. SO, ACCORDING TO THE AO , THE ASSESSEE HAD EARNED CASH RECEIPT OF RS.2,05,307/ - AND HE HAS MADE EXPENSES AS UNDER: - RS.99,473/ - DEPOSITED IN LIC RS.36,000/ - H/H WITHDRAW ALS RS.1,35,473/ - 10. IN THIS WAY, THE ASSESSEE WAS HAVING CASH BALANCE OF RS.69,824/ - (2,05,307/ -- 1,35,473/ - ) ONLY OUT OF HIS CURRENT YEARS INCOME WITH HIM. PAGE NO. 4 11. IN RESPECT TO THE AMOUNT OF RS.3,70,184/ - WHICH WAS STATED AS CASH IN HAND AS ON 31.03.2006 AND THE AO OBSERVED AFTER PERUSAL OF THE STATEMENT OF AFFAIRS FOR ASSESSMENT YEAR 2006 - 07 THAT NO INVESTMENT HAD BEEN SHOWN BY THE ASSESSEE IN HIS MONEY LENDING BUSINESS AND ONLY INTEREST INCOME OF RS.15,000/ - WAS SH OWN IN HIS P&L A/C ; AND THE AO ALSO OBSERVED AFTER PERUSAL OF STATEMENT OF AFFAIRS FOR ASSESSMENT YEAR 2007 - 08, THAT THE ASSESSEE HAD SHOWN INVESTMENT IN MONEY LENDING BUSINESS AMOUNTING TO RS. 4,00,000/ - ACCORDING TO THE AO A SUM OF RS.3,70,184/ - WAS INVE STED IN THE ASSESSEES MONEY LANDING BUSINESS AND THE ASSESSEE WAS NOT HAVING ANY CASH IN HAND AS ON 31.03.2006 AND REJECTED THE CLAIM OF THE ASSESSEE THAT RS.3,70,187/ - WAS THE CLOSING BALANCE AS CASH IN HAND AS ON 31.03.2006 WHICH ALSO STOOD AS CASH IN H AND AS ON 31.03.2007 . 12. IT WAS ALSO TAKEN NOTE BY THE AO THAT ASSESSEE HAD TAKEN UNSECURED LOANS FROM DIFFERENT PARTIES, CAR LOANS FROM PNB AND LOAN FROM SYNDICATE BANK FOR WHICH THE ASSESSEE WAS PAYING HEAVY INTEREST, WHEREAS THE ASSESSEE WAS SUPPOSED TO BE HAVING HUGE AMOUNT OF CASH IDLE IN HIS HANDS WHICH ACCORDING TO AO WAS UNBELIEVABLE. IN THE SAID CIRCUMSTANCES THE AO REJECTED THE EXPLANATION OF ASSESSEE IN RESPECT OF CASH IN HAND OF RS.13,59,347 / - AS ON 31.03.2007 AND AN ADDITION OF RS.13,59,347/ - WAS MADE TO THE INCOME OF THE ASSESSEE ON A/C OF UNEXPLAINED CASH IN HAND FOR ASSESSMENT YEAR 2007 - 08. 13. AGGRIEVED BY THE SAID ORDER OF THE AO, THE ASSESSEE PREFERRED AN APPEAL BEFORE THE LD CIT(A). 14. IT WAS EXPLAINED BY THE ASSESSEE BEFORE THE LD CIT(A) THAT RS.1 0 , 20 , 220/ - W AS THE CAPITAL OF THE ASSESSEE AS ON 31 - 03 - 2001. AND T HE CAPITAL OF THE ASSESSEE IS PROVED WITH OLD CAPITAL AS ON 31 - 03 - 2006, PLUS INCOME DECLARED FOR THIS YEAR LESS WITHDRAWALS FOR HOUSEHOLD EXPENSES AND LIC. AND T HE AO IS SI LENT IN RESPECT TO THE CAPITAL OF THE ASSESSEE APPEARING IN THE STATEMENT OF AFFAIRS. 15 . IT WAS SUBMITTED BEFORE THE CIT(A) THAT FAMILY LOAN OF RS.8 , 50 , 000/ - WAS TAKEN FROM WIFE AND UNCLE OF ASSESSEE. BOTH CREDIT ORS ARE ASSESSED TO INCOME TAX AND CONFIRMATION REGARDING THE SAME HAS BEEN FILED. MOREOVER IT WAS POINTED OUT THAT THE LOANS ARE TAKEN IN EARLIER YEARS. THE AO HOWEVER HAS MADE NO COMMENT ON THIS POINT. 16. IT WAS ALSO SUBMITTED BEFORE THE CIT(A) THAT B ANK LOAN OF RS. 3,27,776/ - WAS PAGE NO. 5 TAKEN FROM PNB FOR PURCHASE OF CAR AND 2N D BANK LOAN OF RS. 9,80,545/ - F R O M SYNDICATE BANK . COPIES OF ACCOUNTS OF BOTH BANK S HAVE BEEN FILED BEFORE THE AO. HOWEVER THE AO MADE NO COMMENT ON THESE LOANS TOO. THUS TOTAL FUNDS AVAILABLE WITH THE ASSESSEE ON 3 - 03 - 2 007 STOOD AT RS. 31,78,541/ - AGAINST WHICH THERE ARE TOTAL ASSETS OF RS. 31,78,541/ - INCLUDING CASH IN HAND AND BALANCE IN ACCOUNT OF - STATE BANK OF PATIALA AT RS. 13,59,347/ - . THE AO HAS FAILED TO APPRECIATE THAT AS LONG AS ASSETS HELD BY ASSESSEE AND AP PEARING ON DEBIT SIDE OF STATEMENT OF AFFAIRS ARE COVERED WITH PROVED FUNDS ON ITS CREDIT SIDE ANY PART OF SUCH ASSETS MAY NOT BE HELD AS UNEXPLAINED. IT WAS ALSO IMPORTANT TO NOTE THAT IT WA S NOT THE CASE OF DEPTT. THAT ASSESSEE WAS HOLDING SOME ASSETS OUT SIDE THE STATEMENT OF AFFAIRS AND HENCE THE CASH IN HAND MAY NOT BE HELD AS UNEXPLAINED. IT WAS ALSO SUBMITTED THAT THE ASSESSEE HAS ARRANGED THE CASH IN QUESTION FOR BEING INVESTMENT IN NE W FIRM. THE NEW FIRM COULD BE ORGANIZED IN NEXT YEAR AND THE CASH IN QUESTION WAS INVESTED THEREIN. THUS IT WAS PLEADED BEFORE THE CIT(A) THAT ENTIRE ADDITIONS AND DISALLOWANCE OF RS. 15,64,040/ - LIABLE TO BE DELETED. 17. IT WAS ALSO BROUGHT TO THE KNOWL EDGE OF THE CIT(A) THAT ALL THE ABOVE SUBMISSION ON THIS POINT OF CASH IN HAND WERE MADE BEFORE THE AO THROUGH PETITION DATED 03 - 03 - 2010 MOVED U/ S 154 OF THE ACT, AFTER COMPLETION OF THE ASSESSMENT IN QUESTION U/S 143(3). ALONG WITH THE SAID PETITION U/S 154, COMPARATIVE STATEMENT OF TWO YEARS AFFAIRS ONE FOR F.Y. 31 - 03 - 2006 AND OTHER FOR F.Y. ENDING ON 31 - 03 - 2007 WAS ALSO FURNISHED. AND 2 YEARS PERIOD HAS EXPIRED AND THE SAID PETITION IS STILL LYING UNDISPOSED BY THE DEPTT . 18. IT WAS ALSO SUBMITTED BE FORE THE CIT(A) T HAT FROM A PERUSAL OF THE COMPARATIVE FIGURES OF TWO YEARS STATEMENTS OF AFFAIRS IT WOULD BE EVIDENT THAT DURING THE YEAR UNDER CONSIDERATION, THE APPELLANT HAS PURC HASED TWO LANDS: - ONE IN ROSHAN PUR DORLI VILLAGE AND OTHER IN GANGA NAGAR COLONY AT MAWANA ROAD, TOTAL INVESTMENTS IN THESE TWO LANDS INCLUDING ALL EXPENSES OF STAMPS AND MISCELLANEOUS STAND AT RS. 422000/ - (REFER TO THE STATEMENT OF SUCH INVESTMENT PLACED AT PAGE 16 OF THE PAPER BOOK). AMOUNT OF RS. 4,00,000/ - DRAWN FROM UCO BANK ACCOUNTS OF THE APPELLANT COPY OF THE UCO BANK ACCOUNT IS PLACED AT PAGE 13 TO 14 OF THE PAPER BOOK IN SUPPORT OF THE CONTENTION AND CASH AMOUNT OF RS. 2,2,000/ - IS FROM THE INCOME OF THE YEAR AND STAND ADJUSTED IN THE CASH GENERATION STATEMENT PLACE D AT PAGE 23 TO 24 OF THE PAPER BOOK. PAGE NO. 6 19. THAT IN A.Y. 2006 - 07 THERE WAS NO TRANSACTION IN THE ACCOUNT OF THE APPELLANT IN UCO BANK AND HENCE ITS OLD BALANCE WAS PLACED ALONG WITH CASH AND ADVANCES UNDER THE HEAD 'CASH ADVANCE AND UCO BANK' IN ABSENCE OF COPY OF THE BANK ACCOUNT. DURING THE YEAR UNDER CONSIDERATION ALL BANK TRANSACTION WERE THROUGH UCO BANK AND ITS COPY OF ACCOUNT WAS AVAILABLE SO ITS BALANCE WAS SEPARATELY PLACED IN THE STATEMENT OF AFFAIRS. THERE WAS NO TRANSACTION IN THE STATE BANK OF P ATIALA AND NO COPY OF THIS ACCOUNT WAS AVAILABLE FOR THE YEAR UNDERATION AND SO ITS OLD BALANCE WAS TO BE PLACED WITH CASH AND ADVANCE. THROUGH MISTAKE INSTEAD OF STATE BANK OF PATIALA, NAME OF UCO BANK WAS ADDED TO CASH AND ADVANCES. DUE THIS MISTAKE AND WRONG APPREHENSION OF THE FACTS, THE AO ASSUMED THAT CASH IN HAND STOOD AT RS. 13,59,347/ - INSTEAD OF RS. 13,57,269/ - AS UNDER. TOTAL FIGURE OF 1/ CASH ADVANCES AND BANK' 13,59,347.00 BALANCE IN STATE BANK OF PATIALA 2,078.00 CASH AND ADVANCES 13,57,269.00 20. IN VIEW OF ABOVE MISTAKE AND WRONG APPRECIATION OF THE FACTS THE AO TOOK CASH AND ADVANCES AT RS. 13,59,347/ - INSTEAD RS.13,57,269/ - . THE COPIES OF THE ABOVE TWO BANKS ACCOUNT WERE AVAILABLE BEFORE THE AO. WHICH CLAR IFY THE MISTAKE IN QUESTION. 21. THAT TO PROVE THE AVAILABILITY OF CASH IN HAND AT RS. 13,57,269/ - THE APPELLANT HAS MADE A LONG DROWN PROCESS OF WORKING OUT CASH IN HAND AS ON 31 - 03 - 2007 AFTER TAKING INTO CONSIDERATION ALL TRANSACTIONS OF THE YEAR. THRO UGH THIS PROCESS CASH IN HAND IS WORKED OUT AT RS. 13,60,954/ - IN PLACE OF RS. 13,57,269/ - SHOWN THROUGH STATEMENT OF AFFAIRS AND HENCE CASH IN HAND AND ADVANCES SHOWN IN THE STATEMENT OF AFFAIRS DESERVE TO BE HELD AS PROVED AND ACCEPTABLE ON FACTS AND IN LAW AND ACCORDING TO THE PRINCIPLE OF ACCOUNTANCY. 22. . TAKING NOTE OF THE AFORESAID SUBMISSION AND CAREFUL PERUSAL OF THE RECORDS WE FIND THAT THE LD CIT(A) HAS MADE A FINDING THAT ON 31.03.2007 THE ASSESSEE WAS HAVING TOTAL CASH OF RS.13,60,954/ - ; AND THE ASSESSEE HA D FILED ALL THE DETAILS IN RESPECT TO HIS WITHDRAWALS FROM THE ACCOUNT OF THE ASSESSEE IN THE FIRM M/S. APPROVE HOME DEVELOPERS, WHICH WE HAVE SEEN AT PG. 7 OF THE PAPER BOOK AND WITHDRAWAL FROM THE ACCOUNT OF THE ASSESSEE IN THE FIRM M /S. SHARDA STATE PROMOTERS PLAC ED AT PAGE 8 OF THE PAPER BOOK AND CASH DRAWN FROM OTHER BANK ACCOUNTS OF THE APPELLANT AS INDICATED IN THE STATEMENT PLACED AT PG. 15 OF THE PAPER BOOK. WE PAGE NO. 7 FIND THAT THE LD. CIT(A) RIGHTLY HELD THAT THE AO ERRED IN ARRIVING AT THE CORRECT FIGURE OF CASH IN HAND WITH REFERENCE TO THE INCOME SHOWN IN THE P & L ACCOUNT & AFORESAID WITHDRAWAL FROM FIRMS OF BANKS. THEREFORE WE ARE INCLINED NOT TO INTERFERE WITH THE ORDER OF THE LD. CIT(A) IN THIS REGARD AND DISMISS THE APPEAL OF THE REVENUE. 23. GROUND NO. 2 AND 3 IS REGARDING DISALLOWANCE MADE ON ACCOUNT OF EXPENDITURE ON CAR AND DELETI ON OF ADDITION MADE ON HOUSEHOLD EXPENSES. 24 . BEFORE ADVERTING TO THE SPECIFIC FINDING OF THE AO , WE CONSIDER IT APPROPRIATE TO NOTE THAT THE ASSESSEE HAS FILED HIS RETURN OF INCOME DECLARING AN INCOME OF RS.1,06,010/ - . AGAINST SUCH INCOME HE HAD CLAIMED FOUR EXPENSES ON ACCOUNT OF CAR I.E. EXPENSES INCURRED ON ACCOUNT OF BANK INTEREST ON CAR LOAN, DEPRECIATION CLAIMED ON CAR USED FOR BUSINESS , CAR INSURANCE EXPE NSE & CAR MAINTENANCE EXPENSES. 25 . THE NATURE OF EXPENSES NAMELY INSURANCE OF THE CAR DOES NOT WARRANT PRODUCTION OF BOOKS OF ACCOUNT. IN RESPECT TO THE AFORESAID EXPENSES THE ASSESSEE HA D SUBMITTED BEFORE THE LD CIT(A) AS UNDER: - (A) RS.22328/ - AS BANK INTEREST ON LOAN RAISED FOR PURCHASE OF CAR FROM PNB. EXTRACT OF THE CAR LOAN ACCOUNT IS LACED AT A E 9 OF THE PAPER BOOK. DETAILED CO OF THE PNB A/C HAS BEEN FILED BEFORE THE AO. (B) RS. 48825/ - BEING DEPRECIATION ON CAR PURCHASED IN EARLIER YEAR AND HAVING WDV FOR THIS AT RS.4,88,250/ - .THE CAR HAS BEEN USED FOR CARRYING ON THE 3 TYPES OF BUSINESS CARRIED BY THE APPELLANT AND DEPRECIATION HAS BEEN CLAIMED @ 10% ONLY. SIMILAR DEPRECIATION WAS CLAIMED AND ALLOWED IN EARLIER YEAR. (C) INSURANCE'S EXPENSES OF RS. 15794/ - ON CAR PAID THROUGH ACCOUNT PAYEE CHEQUE OF UCO BANK ON 18 - 5 - 2006, COPY OF THE BANK ACCOUNT FILED BEFORE THE AO AND COPY THERE OF IS PLACED AT PAGE 13 OF THE PAPER BOOK. (D) RS.5746/ - THESE ARE THE ONLY DAY TO DAY EXPEN SES INCURRED FOR REPAIR AND MAINTENANCE OF CAR, PETROL EXPENSES AND DIFFERENT TYPE OF OTHER EXPENSES INCURRED IN CONNECTION WITH DIFFERENT BUSINESS CARRIED ON BY THE APPELLANT. THESE EXPENSES ALONE MAY BE HELD AS WITHOUT SUPPORTING DOCUMENTARY EVIDENCE. BUT BUSINESS NEED OF THE ASSESSEE AND REASONABILITY OF THE CLAIM MADE MAY NOT BE IGNORED. WHERE CAR IS OWNED AND USED BY THE ASSESSEE FOR BUSINESS PURPOSES, THE REASONABLE CLAIM FOR PETROL, REPAIR AND MAINTENANCE MUST BE ALLOWED. THE CLAIM OF RS. 5746/ - F OR ALL TYPE OF BUSINESS EXPENSES DESERVED TO BE ALLOWED AS REASONABLE EXPENSES FOR BUSINESS PURPOSE. PAGE NO. 8 4. THAT AFTER COMPLETION OF ASSESSMENT IS] S 143(3) THE AO SENT THE DEMAND FOR RECOVERY TO THE TRO MEERUT, WITHOUT WAITING FOR THE RESULTS OF APPEAL IN QU ESTION AND IGNORING THE STAY PETITION PENDING BEFORE THE AO. ON RECEIPT OF RECOVERY NOTICE FROM TRO THE APPELLANT MOVED PETITION U/ S 154 OF THE ACT, BEFORE THE AO ON 24 - 08 - 2010 THROUGH DAK COUNTER WHICH IS STILL PENDING BEFORE THE AO, COPY OF THE SAID PET ITION IS PLACED AT PAGES 20 TO 22 THE PAPER BOOK IN WHICH SIMILAR SUBMISSIONS WERE MADE AND THE RECTIFICATION OF THE MISTAKE WERE SOUGHT. IN VIEW OF ABOVE SUBMISSION THE DISALLOWANCE OF EXPENSES OF RS. 102693/ - MAY BE HELD AS WRONG ILLEGAL AND UNWARRANTE D AND THEREFORE DESERVE TO BE DELETED IN ITS ENTIRETY. 5. THAT THE FAMILY CONSISTS OF 4 PERSONS NAMELY APPELLANT HIMSELF, HIS WIFE SMT. USHA AGARWAL, HIS SON ANKIT AND DAUGHTER ASHA GARG. ALL THE 4 PERSONS ARE REGULARLY ASSESSED TO INCOME TAX AND HAVE BEE N MAKING WITHDRAWALS FOR HOUSE HOLD EXPENSES FORM THEIR OWN SOURCES OF INCOME. THERE IS ONE HUF HARIOM & SONS WHICH IS ALSO MAKING WITHDRAWALS FOR HOUSE HOLD EXPENSES. THE TOTAL WITHDRAWALS MADE BY THESE 5 PERSONS FOR THE YEAR UNDER CONSIDERATION, STOOD AT RS. 90000/ - ONLY. THE COMPARATIVE STATEMENT OF WITHDRAWALS MADE BY THE 5 PERSONS FOR THIS YEAR AND EARLIER YEARS HAS BEEN PREPARED AND IS PLACED AT PAGE 2 OF THE PAPER BOOK. THIS STATEMENT STAND TO PROVE THAT TOTAL WITHDRAWALS MADE THIS YEAR STAND AT HIGH EST FIGURE OF RS. 90000/ - AGAINST RS. 84000/ - MADE IN IMMEDIATELY EARLIER YEAR. THE WITHDRAWALS SO MADE HAVE BEEN ACCEPTED BY THE DEPTT. IN ALL THE EARLIER YEARS IN THE CASE OF APPELLANT AS WELL AS IN 4 OTHER CASES. THERE IS NO SPECIFIC REASON OR GROUND WA RRANTING DEPARTURE FROM THE PAST YEARS ACCEPTED HISTORY OF THE CASE. SO THE ADDITION OF RS.1,02,000/ - ON ACCOUNT OF LAW WITH DRAWALS IN RESPECT TO HOUSE HOLD EXPENSE NEED TO BE DELETED. 26 . HAVING REGARD TO THE ABOVE SUBMISSION , THE LD CIT(A) HAS DELETED THE SAID ADDITION. ALL EXPENSES DISCLOSED ARE COMPARABLE TO THE EARLIER YEARS. THERE IS NO MATERIAL TO SHOW THAT THERE IS ANY EXORBITANT INCREASE IN EXPENDITURE IN THE INSTANT YEAR. THE AO PROCEEDED ON ASSUMPTION WHICH IS NOT PERMISSIBLE. ALL EXP ENSES ARE SUPPORTED BY NECESSARY EVIDENCE WHICH HAS BEEN PLACED ON RECORD BEFORE AO AND THE LD DR HAS NOT BROUGHT TO OUR NOTICE ANY MATERIAL SO AS TO SHOW THAT NO SUCH EVIDENCE WA S FURNISHED BEFORE THE AO. MORE SO , WE NOTICE THAT THE NATURE OF E XPENSES CLA IMED BY THE ASSESSEE DOES NOT WARRANT ANY ADDITION. THERE IS NO DISPUTE AS TO THE EXISTENCE OF CAR AND THE CAR LOAN, FACTS OF WHICH WAS DULY REFLECTED IN THE STATEMENT OF AFFAIRS, WHICH HAS BEEN ACCEPTED BY THE AO. THUS DEPRECIATION OF COST OF CAR AND INTEREST ON CAR LOAN ARE STATUTORY DEDUCTION WHICH MUST BE GRANTED TO THE ASSESSEE AND THE INSURANCE HAS BEEN PAID BY ACCOUNT PAYEE CHEQUES . HAVING REGARD TO THE FACTUAL MATRIX WE FEEL IT APPROPRIATE TO CONFIRM THE DELETION OF THE SAID EXPENSES. THEREFORE WE ARE INCLINED NOT TO INTERFERE IN THE IMP UGNED ORDER OF THE LD. CIT(A) IN THIS REGARD. PAGE NO. 9 27 . IN RESPECT TO THE DELETION O F ADDITION MADE ON ACCOUNT OF LO W WITHDRAWAL FOR HOUSE HOLD EXPENSE. WE FIND THAT THE ASSESSEE ALONG WITH HUF TOGETHER HAS WITHDRAWN R S.54,000/ - CONSIDERING THE FACT & CIRCUMSTANCES OF THE ASSESSEE . WE DO NOT FIND ANY REASON TO DISAGREE WITH THE ORDER OF THE CIT(A) IN THIS RESPECT AND WE CONFIRM THE DELETION OF TH E SAID ADDITION MADE BY THE AO AND DISMISS BOTH THE GROUNDS OF APPEAL BY TH E REVENUE. 28. IN THE RESULT THE APPEAL IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 0 4 . 09 . 2014. - SD / - - SD / - ( B.C.MEENA ) (A. T. VARKEY) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 0 4 / 09 / 2014 A K KEOT COPY FORWARDED TO 1. APPLICANT 2. RESPONDENT 3. CIT 4. CIT (A) 5. DR:ITAT ASSISTANT REGISTRAR ITAT, NEW DELHI