Shri Devraj Singh Gurjar, Rajgarh V. The ITO, Shajapur

ITA 430/IND/2012

• Counselvise Citation: [2013] 120 COUNSELVISE.COM (IT) 1493 (ITAT-INDORE)
• Duration Of Justice: 7 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-02-2013
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2006-2007
• Appeal Filed On: 06-07-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: R A VERMA
• Assessee Lawyers: S S DESHPANDE
• Keywords: Income from undisclosed sources; Additional evidence; Reasonable cause
• Section: 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL , INDORE BENCH, INDORE BEFORE SHRI JOGINDER SINGH, J.M. AND SHRI R.C.SHARM A, A.M. PAN NO. : BFBPS2131H I.T.A.NO. 430/IND/2012 A.Y. : 2006 - 07 SHRI DEVRAJ SINGH GURJAR, ITO, VILLAGE JEPLA, BIORA VS SHAJAPUR. APPELLANT RESPONDENT APPELLANT BY : SHRI S. S. DESHPANDE, C. A. RESPONDENT BY : SHRI R. A. VERMA, SR. DR , CIT DR DATE OF HEARING : 11 . 0 2 .201 3 DATE OF PRONOUNCEMENT : 25 . 0 2 .201 3 O R D E R PER R. C. SHARMA, A.M. THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER PASSED BY THE CIT(A) DATED 8.5.2012 , FOR THE ASSES SMENT YEAR 2006-07, IN THE MATTER OF ORDER PASSED U/S 147/143( 3) OF THE INCOME-TAX ACT, 1961. -: 2: - 2 2. FOLLOWING GROUNDS HAVE BEEN TAKEN BY THE ASSESSEE : - 1. THE ASSESSMENT FRAMED IS ILLEGAL AND BAD IN LAW AND HENCE SHOULD HAVE BEEN ANNULLED. THE REOPENING IS B AD IN LAW. 2. THE LD CIT (A). HAS ERRED IN HOLDING THAT THERE IS NO GROUND IN RESPECT OF THE CASH DEPOSITED IN THE BANK. WHILE IN GROUND NO. 5 AND 6, IT WAS SPECIFICALLY AGITATED TH AT THE CAPITAL INVESTMENTS AND THE CASH DEPOSITS WERE EXPL AINED WHICH IS WRONG AND BAD IN LAW. 2.1 THE LD. CIT(A) HAD CALLED FOR THE REMAND REPORT WHICH WAS SUBMITTED BY THE LD. AO ON THIS GROUND AND THE LD. CIT(A) OUGHT TO HAVE ADMITTED THE GROUND AND ADDITIONAL EV IDENCE AND ADJUDICATED ON THE POINT AND DECIDED THE APPEAL . 2.2 THE ADDITIONS OFRS. 1,90,000/- MAY PLEASE BE DE LETED. 3. THE LD. CIT(A) HAS ERRED IN UPHOLDING THE ADDITI ON OFRS. 2,63,185/- AS UNDISCLOSED INCOME. IT WAS PROVED BEF ORE THE LD CIT(A) THAT THE ASSESSEE HAS THE AGRICULTURAL IN COME OF THE FAMILY AND THE TOTAL ENTRIES BELONG TO THE FAMI LY. THUS -: 3: - 3 NO ADDITION COULD HAVE BEEN MADE IN THE HANDS OF TH E ASSESSEE. 3.1 WITHOUT PREJUDICE THE ASSESSEE HAD THE AGRICULT URAL INCOME AND THE INVESTMENTS WERE EXPLAINED OUT OF TH E SAME. THE ADDITION OF RS. 2,63,185/- MAY PLEASE BE DELETED. 4. THE LD. CIT(A) HAS ERRED IN UPHOLDING THE ADDITI ON OF RS. 80,000/SHOWN AS AGRICULTURAL INCOME. THE ASSESSEE W AS CULTIVATING THE LANDS AND THE KHASRA DOCUMENTS WERE FILED. THE ADDITION OF RS. 80000/- MAY PLEASE BE DELETED. 5. THE LD. CIT(A) HAS ERRED IN UPHOLDING THE ADDITION OF RS. 80,650/BEING THE CASH SEIZED. THE AVAILABILITY OF C ASH WAS PROVED, AS SUCH NO ADDITION COULD HAVE BEEN MADE ON THIS ACCOUNT. FURTHER, THE INCOME IS ALSO ADDED AND THE ASSETS ARE ALSO ADDED THERE BY MAKING DOUBLE ADDITION. Z; -: 4: - 4 3. RIVAL CONTENTIONS HAVE BEEN HEARD AND RECORDS PERUSED. THE BRIEF FACTS OF THE CASE ARE THAT THE A SSESSEE SHRI DEVRAJ SINGH GURJAR WAS ARRESTED BY BIAORA POLICE WITH SOME CASH, JEWELLERY ETC. A RED BOOK/DIARY WAS ALSO SEIZ ED BY THE POLICE AUTHORITIES. LATER ON INVESTIGATION WING, IN DORE HAD CONDUCTED INQUIRIES IN THE MATTER. AS PER THE INQUI RIES OF ADIT (INVESTMENT.), IT IS FOUND THAT DURING THE YEAR UND ER CONSIDERATION ASSESSEE HAS MADE INVESTMENT IN BANK ACCOUNT NO. 11997 MAINTAINED BY HIM IN DISTRICT COOP. CENTR AL BANK, RAJGARH, AT RS. 1,90,000/-, MONEYLENDING/PAWNING BU SINESS AT RS. 3,20,960/- AND CASH SEIZED BY BIAORA POLICE RS. 80,650/-0. TOTAL INVESTMENT OF R.S 5,91,610/- WAS M ADE BY THE ASSESSEE. SINCE ASSESSEE HAS NOT FILED THE RETURN F OR THE YEAR UNDER CONSIDERATION, THE ASSESSING OFFICER HAS ISSU ED NOTICE U/S 148 ON 12.12.2007. IN RESPONSE TO THE NOTICE TH E ASSESSEE HAS FILED THE RETURN FOR THE ASSESSMENT YEAR 2006-0 7 DECLARING TOTAL INCOME AT RS. 578,780/- AND AGRICULTURAL INCO ME OF RS. 80,000/-. THE ASSESSEE HAS NOT FURNISHED ANY PROOF OF AGRICULTURAL INCOME, THEREFORE, ASSESSING OFFICER H AS TREATED INCOME FROM AGRICULTURAL SHOWN BY THE ASSESSEE AT R S. -: 5: - 5 80,000/-, AS INCOME FROM UNDISCLOSED SOURCES. AS T HE ASSESSEE FAILED TO EXPLAIN THE SOURCE OF DEPOSIT OF RS. 1,90,000/- IN BANK ACCOUNT, AN ADDITION OF RS. 1,90 ,000/- WAS ALSO MADE BY ASSESSING OFFICER. THE ASSESSING OFFI CER HAS FURTHER MADE THE ADDITION ON ACCOUNT OF INVESTMENT IN MONEYLENDING/PAWNING FROM UNDISCLOSED SOURCES AT RS . 2,63,185/-. ADDITION OF RS. 12,000/- WAS MADE AGAIN ST LOW HOUSE HOLD WITHDRAWAL. ASSESSMENT U/S 147/143(3) WA S COMPLETED AT RS. 6,03,610/-. AGAINST THE ORDER OF T HE ASSESSING OFFICER ASSESSEE HAS PREFERRED THE APPEAL BEFORE CIT(A). 4. BEFORE THE CIT(A), THE ASSESSEE FURNISHED ADDITIONA L EVIDENCE TO EXPLAIN THE CASH DEPOSITS IN THE DISTRI CT COOPERATIVE CENTRAL BANK, AT RS. 1,90,000/-. HOWEVE R, THE CIT(A) DISMISSED THE GROUND ON THE PLEA THAT THE AS SESSEE HAS NOT FILED ANY APPEAL AGAINST THIS ADDITION MADE BY THE ASSESSING OFFICER AND NOT TAKEN THIS GROUND IN THE APPEAL MEMO. BY OBSERVING THAT NO REASONABLE CAUSE WAS GIV EN BY THE ASSESSEE FOR FURNISHING ADDITIONAL EVIDENCE BEF ORE THE ASSESSING OFFICER, THE CIT(A) DID NOT ADMIT THE GRO UND. -: 6: - 6 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND FOUND THAT ADDITIONAL EVIDENCE FILED BY THE ASSESSEE WITH REGARD TO THE CASH DEPOSITED IN THE BANK ACCOUNT, GOES TO THE ROOT OF THE ISSUE AND SINCE THE ASSESSEE HAS TAKEN THIS GROUND BEFORE THE CIT(A), WHO HAS GOT COTERMINOUS POWER WITH THAT OF THE ASSESSING OFFICER, SHE SHOULD HAVE ACCEPTED THE ADD ITIONAL EVIDENCE AND AFTER CALLING THE REMAND REPORT, SHOUL D HAVE ADJUDICATED THE ISSUE ON MERIT. IN THE INTEREST OF JUSTICE AND FAIR PLAY, WE RESTORE THIS GROUND TO THE FILE OF TH E ASSESSING OFFICER FOR DECIDING AFRESH AFTER CONSIDERING THE A DDITIONAL EVIDENCE FILED BY THE ASSESSEE BEFORE THE CIT(A) TO SUBSTANTIATE ITS CLAIM OF CASH DEPOSIT IN THE BANK ACCOUNT. WE D IRECT ACCORDINGLY. 6. WITH REGARD TO ADDITION OF RS. 3,20,960/- ON THE GROUND OF INVESTMENT IN MONEYLENDING BUSINESS, WE F OUND THAT AS PER THE ASSESSMENT ALREADY COMPLETED AND TH E BALANCE SHEET FILED BEFORE THE LOWER AUTHORITIES, THE ASSES SEE WAS HAVING OPENING CAPITAL OF RS. 1,77,639/- AND ALSO L OANS FROM FRIENDS AND RELATIVES AMOUNTING TO RS. 2,03,733/-. TOTAL OF THIS AMOUNT WAS INVESTED IN THE BUSINESS. THE ASSESSEE W AS ALSO -: 7: - 7 HAVING BANK BALANCE OF RS. 3,10,275/- AS ON 31.3.20 05, WHICH WAS AVAILABLE TO THE ASSESSEE AT THE BEGINNING OF T HE YEAR FOR INVESTMENT OF BUSINESS IN MONEYLENDING. WE ALSO FOU ND THAT THE ASSESSEE HAS TRIED TO EXPLAIN THE INVESTMENT IN MONEYLENDING THROUGH VARIOUS WITHDRAWALS IN THE BAN K ACCOUNT, WHICH IS NOT PROPERLY APPRECIATED BY THE L OWER AUTHORITIES. IN THE INTEREST OF JUSTICE, THIS GROUN D IS ALSO RESTORED BACK TO THE FILE OF ASSESSING OFFICER FOR DECIDING AFRESH AFTER GIVING DUE OPPORTUNITY TO THE ASSESSEE. 7. WITH REGARD TO THE ADDITION ON ACCOUNT OF CASH OF R S. 80,650/- SEIZED FROM THE ASSESSEE, WE FOUND THAT CI T(A) HAS ALREADY CONFIRMED THE ADDITION OF RS. 80,000/- IN R ESPECT OF AGRICULTURAL INCOME SHOWN BY THE ASSESSEE, WHICH WA S TREATED AS INCOME FROM OTHER SOURCES. ONCE WE CONFIRM THE A CTION OF LOWER AUTHORITIES FOR TREATING SUCH AGRICULTURAL IN COME AS INCOME FROM OTHER SOURCES, THE REQUIRED CASH WAS AV AILABLE WITH THE ASSESSEE AND MAKING ADDITION OF THE CASH O F RS. 80,650/- SEIZED FROM THE ASSESSEE AMOUNTS TO DOUBLE ADDITION. ACCORDINGLY, WE DIRECT THE ASSESSING OFFI CER TO -: 8: - 8 RESTRICT THIS ADDITION TO RS. 650/- (RS. 80,650/- ( -) 80000/-). WE DIRECT ACCORDINGLY. 8. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWE D IN PART IN TERMS INDICATED HEREINABOVE. THIS ORDER HAS BEEN PRONOUNCED IN THE OPEN COURT ON 25 TH FEBRUARY, 2013. SD/ - SD/ - (JOGINDER SINGH) (R. C. SHARMA) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED : 25 TH FEBRUARY , 2013. CPU* 141825