Smt. Pramila Jain, Kanpur V. Asstt. Commissioner of Income Tax, Kanpur

ITA 433/LKW/2013

• Counselvise Citation: 43323714 RSA 2013
• Duration Of Justice: 2 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-08-2013
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: SMC
• Next Hearing Date: 19-08-2013
• Assessment Year: 2004-2005
• Appeal Filed On: 10-06-2013
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: ALOK MITRA
• Keywords: Assessment record
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH SMC : LUCKNOW BEFORE SHRI SUNIL KUMAR YADAV, JUDICIAL MEMBER I.T.A. NO. 433 /LKW/2013 ASSESSMENT YEAR:0 4 - 0 5 SMT. PRAMILA JAIN, VS. A.C.I.T., 54/1, NAYA GANJ, CENTRAL CIRCLE - II, KANPUR. KANPUR. PAN:ACFPJ6507J (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI ASHISH JAISWAL, ADVOCATE SHRI SHYAM SUNDER GUPTA, F.C.A. RESPONDENT BY : SHRI ALOK MITRA, D.R. DATE OF HEARING : 19 /0 8 /2013 DATE OF PRONOUNCEMENT : 22/08/2013 O RDER THIS APPEAL IS PREFERRED BY THE ASSESSEE AGAINST THE ORDER OF CIT(A) , MAINLY ON TWO GROUNDS . O NE IS WITH REGARD TO THE ADDITION MADE ON ACCOUNT OF OPENING CASH BALANCE AND OTHER ON ACCOUNT OF INCOME FROM OTHER SOURCES. THOUGH THE ASSESSEE HAS RAISED AS MANY AS 8 GROUNDS BUT THE EFFECTIVE GROUNDS ARE ONLY ABOVE TWO GROUNDS. 2. WITH REGARD TO FIRST GROUND, I.E. ADDITION ON ACCOUNT OF OPENING CASH BALANCE OF ` 2,08,653/ - . THE ASSESSING OFFICER HA S NOTED THAT THE ASSESSEE HAS SHOWN THIS AMOUNT AS OPENING BALANCE IN THE CASH FLOW STATEMENT. THE ASSESSING OFFICER ASKED THE ASSESSEE TO EXPLAIN THE SOURCE OF CASH 2 AND IN RESPONSE THERETO THE ASSESSEE HAS STATED THAT IT WAS BROUGHT FORWARD FROM THE BALANCE SHEET AS WELL AS CASH FLOW STATEMENT FOR THE IM MEDIATELY PRECEDING YEAR. THE EXPLANATION FURNISHED BY THE ASSESSEE WAS NOT ACCEPTED BY THE ASSESSING OFFICER AND HE MADE ADDITION OF ` 2,08,653/ - AS UNEXPLAINED CASH. THE ASSESSEE PREFERRED AN APPEAL BEFORE THE CIT(A) BUT DID NOT FIND FAVOUR WITH HIM. 3 . NOW THE ASSESSEE IS BEFORE THE TRIBUNAL WITH THE SUBMISSIONS THAT IN THE IMMEDIATELY PRECEDING YEAR THE ASSESSMENT WAS FRAMED U/S 143(3) OF THE ACT AND THE ASSESSEE HAS FILED THE INCOME & EXPENDITURE ACCOUNT, BALANCE SHEET AND CASH FLOW STATEMENT BEFORE THE ASSESSING OFFICER DURING THE COURSE OF ASSESSMENT PROCEEDINGS. IN SUPPORT OF HIS CONTENTION HE HAS FILED COPY OF THE ASSESSMENT ORDER FOR THE ASSESSMENT YEAR 2003 - 2004. THE COPY OF BALANCE SHEET, INCOME & EXPENDITURE ACCOUNT AND THE CASH FLOW STATEME NT OF THE CURRENT YEAR IS FILED BEFORE US WITH THE SUBMISSIONS THAT OPENING CASH BALANCE SHOWN IN THE CASH FLOW STATEMENT IS CLOSING CASH BALANCE IN THE BALANCE SHEET FOR THE ASSESSMENT YEAR 2003 - 2004. THEREFORE, THE OPENING BALANCE WAS BROUGHT FORWARD FR OM THE EARLIER YEARS. THE LEARNED COUNSEL FOR THE ASSESSEE HAS FURTHER CONTENDED THAT IF THE ASSESSING OFFICER WAS NOT CONVINCED WITH THE CLOSING BALANCE OF THE IMMEDIATELY PRECEDING YEAR, THE INTRODUCTION OF THE CASH CAN ONLY BE VERIFIED IN THE IMMEDIATE LY PRECEDING YEAR I.E. ASSESSMENT YEAR 2003 - 2004 AND NOT IN THE IMPUGNED ASSESSMENT YEAR. THEREFORE, NO ADDITION ON ACCOUNT OF OPENING CASH BALANCE IS CALLED FOR. 4. THE LEARNED D.R. SHRI ALOK MITRA HAS CONTENDED THAT THE ASSESSEE HAS NOT FILED ANY EVIDE NCE ON RECORD THAT HE HAS FILED THE BALANCE SHEET, 3 INCOME & EXPENDITURE ACCOUNT AND THE CASH FLOW STATEMENT DURING THE ASSESSMENT PROCEEDINGS FOR THE ASSESSMENT YEAR 2003 - 2004 AS THERE IS NO NARRATION IN THIS REGARD IN THE ASSESSMENT ORDER. THE LEARNED D. R. FURTHER CONTENDED THAT SINCE NEW FACTS HAVE BEEN RAISED BEFORE THE TRIBUNAL, IT REQUIRES VERIFICATION BY THE ASSESSING OFFICER. THE LEARNED D.R. FURTHER SUBMITTED THAT IN THE INTEREST OF JUSTICE, THE MATTER MAY BE SENT BACK TO THE ASSESSING OFFICER FOR VERIFICATION OF THE FACTS OR THE HEARING MAY BE ADJOURNED SO THAT HE CAN MAKE NECESSARY VERIFICATION FROM THE ASSESSMENT RECORDS. 5. HAVING HEARD THE RIVAL SUBMISSIONS AND FROM A CAREFUL PERUSAL OF THE RECORD, I FIND THAT THE ASSESSEE HAS SHOWN THE CLOSING BALANCE IN THE BALANCE SHEET FOR THE ASSESSMENT YEAR 2003 - 2004 AT ` 2,08,653/ - WHICH IS TAKEN AS OPENING BALANCE IN THE IMPUGNED ASSE SSMENT YEAR. THEREFORE THE OPENING BALANCE WAS BROUGHT FORWARD FROM THE IMMEDIATELY PRECEDING YEAR AND THE GENUINENESS OF THIS CASH CANNOT BE EXAMINED IN THE IMPUGNED ASSESSMENT YEAR. I HAVE ALSO EXAMINED THE BALANCE SHEET FOR OTHER ASSESSMENT YEARS PLAC ED BEFORE ME AT PAGE NO. 26 TO 32 OF THE COMPILATION FROM WHICH IT IS CLEAR THAT THE CASH HAS BEEN GENERATED OVER A PERIOD OF TIME AND THE CLOSING BALANCE OF THE IMMEDIATELY PRECEDING YEAR WAS TAKEN AS OPENING BALANCE OF THE IMPUGNED ASSESSMENT YEAR. IF T HE ASSESSING OFFICER HAS ANY DOUBT REGARDING INTRODUCTION OF CASH, IT CAN ONLY BE VERIFIED FOR THOSE YEARS IN WHICH IT WAS INTRODUCED AND NOT IN THE YEAR IN WHICH IT WAS CARRIED FORWARD AS OPENING BALANCE. THE LEARNED D.R. RAISED AN OBJECTION ABOUT FILING OF THIS DOCUMENT BEFORE THE ASSESSING OFFICER AS NOTHING HAS BEEN MENTIONED IN THE ASSESSMENT ORDER FOR ASSESSMENT YEAR 2003 - 2004 . COPY OF THE ASSESSMENT ORDER IS PLACED ON 4 RECORD. THE LEARNED COUNSEL FOR THE ASSESSEE , DURING THE COURSE OF HEARING, HAS A GREED THAT IF THE MATTER IS RESTORED TO THE ASSESSING OFFICER WITH CERTAIN DIRECTIONS, HE HAS NO OBJECTION IN THIS REGARD. KEEPING IN VIEW THE FACTS OF THE CASE AND THE SUBMISSIONS RAISED BY THE PARTIES, I AM OF THE OPINION THAT THE MATTER MAY BE SENT BAC K TO THE ASSESSING OFFICER WITH THE DIRECTION TO VERIFY THE FACTS WHETHER THE BALANCE SHEET, INCOME & EXPENDITURE ACCOUNT AND THE CASH FLOW STATEMENTS WERE FILED DURING THE COURSE OF ASSESSMENT PROCEEDINGS FOR ASSESSMENT YEAR 2003 - 2004. IF THE BALANCE SHE ET IS FILED BEFORE THE ASSESSING OFFICER IN WHICH CLOSING BALANCE SHOWN WAS AT ` 2,08,653/ - , NO ADDITION CAN BE MADE IN THE IMPUGNED ASSESSMENT YEAR ON ACCOUNT OF UNEXPLAINED OPENING CASH BALANCE. WITH THESE DIRECTIONS I RESTORE THE MATTER TO THE FILE OF T HE ASSESSING OFFICER FOR ADJUDICATION OF THE ISSUE IN THE TERMS INDICATED ABOVE. 6. THE NEXT GROUND RELATES TO THE ADDITION OF ` 22,000/ - WHICH WAS SHOWN BY THE ASSESSEE AS AGRICULTURAL INCOME BUT IT WAS TREATED AS INCOME FROM OTHER SOURCES BY THE REVENUE. DURING THE COURSE OF HEARING THE ASSESSEE HAS FILED THE COPY OF REVENUE RECORD TO ESTABLISH THE OWNERSHIP OF THE AGRICULTURAL HOLDING. AS PER THE REVENUE RECORD I.E. KISAN BAHI, THE ASSESSEE OWNED 5 BIGH OF AGRICULTURAL LAND. THE LEARNED D.R. STRONGLY CONTENDED THAT THE COPY OF THE KISAN BAHI WAS NOT PLACED BEFORE THE LOWER AUTHORITIES; THEREFORE, IT CANNOT BE ADMITTED AS EVIDENCE. AT THE MOST THE MATTER MAY BE SENT BACK TO THE ASSESSING OFFICER. THE LEARNED COUNSEL FOR THE ASSESSEE FURTHER CONTENDED THAT THE KISAN BAHI WAS FILED BEFORE THE LOWER AUTHORITIES BUT THEY HAVE NOT TAKEN A PROPER COGNIZANCE OF THE SAME AND TREATED THE AGRICULTURE INCOME OF THE ASSESSEE AS INCOME FROM OTHER SOURCES. 5 7. I HAVE CAREFULLY EXAMINED THE KISAN BAHI AND FIND THAT THE ASSESSEE OWNED CERTAIN AGRICULTURAL HOLDING OUT OF WHICH HE MIGHT HAVE EARNED SOME AGRICULTURE INCOME. THE ASSESSEE HAS CLAIMED ` 22,000/ - AGRICULTURE INCOME WHICH APPEARS TO BE REASONABLE AMOUNT O F INCOME EARNED OUT OF AGRICULTURAL ACTIVITIES OF THE LAND SHOWN IN THE KISAN BAHI. SINCE THE ASSESSEE HAS PLACED THE EVIDENCE WITH REGARD TO THE OWNERSHIP OF THE AGRICULTURAL HOLDING, THE AGRICULTURE INCOME REQUIRES TO BE ESTIMATED. THE INCOME SHOWN BY THE ASSESSEE IS QUITE REASONABLE AND I FIND NO MERIT IN THE ADDITION MADE BY THE LOWER AUTHORITIES. ACCORDINGLY, I SET ASIDE THE ORDER OF CIT(A) AND DELETE THE ADDITION. 8. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS PARTLY ALLOWED FOR STATISTICAL PURPO SES. (ORDER PRONOUNCED IN THE OPEN COURT ON 22/08/2013 ) SD/. (SUNIL KUMAR YADAV) JUDICIAL MEMBER DATED: 22/08/2013 *CL SINGH COPY FORWARDED TO THE: 1. APPELLANT. 2. RESPONDENT. 3. CIT (A) 4. CIT 5. DR. ASSISTANT REGISTRAR