DCIT, CHENNAI V. Karunaianandan, CHENNAI

ITA 447/CHNY/2013

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 73666 (ITAT-CHENNAI)
• Duration Of Justice: 10 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-01-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: D
• Next Hearing Date: 08-01-2014
• Assessment Year: 2009-2010
• Appeal Filed On: 14-03-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: HARI RAO
• Assessee Lawyers: G BASKAR
• Keywords: Unexplained expenditure
• Section: 69C; 132

Judgement Text

IN THE INCOME-TAX APPELLATE TRIBUNAL D BENCH, CHENNAI. BEFORE SHRI A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER & SHRI V. DURGA RAO, JUDICIAL MEMBER ITA NO.447/MDS/2013 ASSESSMENT YEAR: 2009-10 & C.O.NO.67/MDS/2013 [IN ITA NO.447/MDS/2013] THE DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE II(4), CHENNAI-34. VS. SHRI KARUNAIANANDAN, NO. 43/16, TELUGU CHETTY STREET, OLD WASHERMANPET, CHENNAI 600 021. [PAN : AAATD0425G] (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI HARI RAO, JCIT RESPONDENT BY : SHRI G. BASKAR, ADVOCATE DATE OF HEARING : 08.01.2014 DATE OF PRONOUNCEMENT : 28.01.2014 O R D E R PER V. DURGA RAO, JUDICIAL MEMBER : THIS APPEAL FILED BY THE REVENUE AND CROSS OBJECTIO N BY THE ASSESSEE ARE DIRECTED AGAINST THE ORDER OF THE COMM ISSIONER OF INCOME TAX (APPEALS) II, CHENNAI DATED 21.12.2012 RELEVANT TO THE ASSESSMENT YEAR 2009-10. 2. THE APPEAL OF THE REVENUE IS TIME BARRED BY THR EE DAYS IN FILING. THE DEPARTMENT HAS FILED AN AFFIDAVIT REQUESTING TO CON DONE THE DELAY. BY REFERRING TO THE CONTENTS THEREIN, THE LD. DR HAS R EQUESTED TO CONDONE THE I.T.A. I.T.A. I.T.A. I.T.A. NO. NO. NO. NO.447 447447 447/M/ /M/ /M/ /M/13 1313 13 & & & & C.O. NO. 67/M/13 C.O. NO. 67/M/13 C.O. NO. 67/M/13 C.O. NO. 67/M/13 2 DELAY. THE LD. COUNSEL FOR THE ASSESSEE HAS NOT OBJ ECT TO THE SUBMISSIONS OF THE LD. DR. ON PERUSAL OF THE AFFIDAVIT FILED FOR C ONDONATION OF DELAY, WE ARE SATISFIED THAT THE REVENUE WAS PREVENTED BY SUFFICI ENT CAUSE FROM NOT FILING THE APPEAL WITHIN THE STIPULATED TIME. ACCORDINGLY, WE CONDONE THE DELAY OF FIVE DAYS IN FILING THE APPEAL AND ADMIT THE SAME F OR HEARING. 3. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE I S THE PROPRIETOR OF M/S. ANANDA OIL CORPORATION, TRADING IN OIL AND ALSO DIR ECTOR OF M/S. KALEESUWARI REFINERY PVT. LTD. THERE WAS A SEARCH CONDUCTED UND ER SECTION 132 OF THE INCOME TAX ACT IN THE CASE OF SHRI G. KARUNAIANANDA N, DIRECTOR OF M/S. KALEESUWARI REFINERY PVT. LTD. ON 16.07.2008. THE R ETURN OF INCOME WAS FILED ON 18.08.2010 DECLARING AN INCOME OF ` .87,70,059/-. THE ASSESSING OFFICER HAS COMPLETED THE ASSESSMENT ON 30.12.2010 BY DETERMINING TOTAL INCOME OF THE ASSESSEE AT ` .1,22,62,979/-, WHEREIN THE ASSESSING OFFICER HAD MADE AN ADDITION IN RESPECT OF UNEXPLAINED EXPE NDITURE OF ` .29,42,831/- UNDER SECTION 69C OF THE ACT. IN THE ASSESSMENT ORD ER, THE ASSESSING OFFICER HAS OBSERVED THAT AS PER CASH BOOK OF M/S. ANANDA O IL CORPORATION, THE PROPRIETOR CONCERN OF THE ASSESSEE ON THE DATE OF S EARCH ON 16.07.2008 THERE SHOULD HAVE BEEN A CASH BALANCE OF ` .49,42,831/-. OUT OF THIS, ` .20,00,000/- WAS DEPOSITED IN BANK, LEAVING A DEFIC IT IN PHYSICAL AVAILABILITY OF CASH TO THE EXTENT OF ` .29,42,831/-. DURING THE COURSE OF SEARCH, THIS AMOUNT WAS NOT FOUND. THE ASSESSING OFFICER ISSUED SHOW-CAUSE NOTICE TO I.T.A. I.T.A. I.T.A. I.T.A. NO. NO. NO. NO.447 447447 447/M/ /M/ /M/ /M/13 1313 13 & & & & C.O. NO. 67/M/13 C.O. NO. 67/M/13 C.O. NO. 67/M/13 C.O. NO. 67/M/13 3 THE ASSESSEE PROPOSING TO ASSESS THE CASH DEFICIT A S UNEXPLAINED EXPENDITURE UNDER SECTION 69C OF THE ACT. THE ASSES SEE HAS SUBMITTED BEFORE THE ASSESSING OFFICER THAT THE MONEY WAS GIV EN ON SUSPENSE ACCOUNT TO THE PROPRIETOR OF THE CONCERN AND THE OTHER OFFI CIALS TO MEET THE DAY-TO-DAY EXPENSES. IT WAS ALSO SUBMITTED THAT THE SHORTAGE I N CASH CANNOT BE ADDED UNDER SECTION 69C. THE ASSESSING OFFICER, HOWEVER, NOT ACCEPTED THE EXPLANATION OF THE ASSESSEE AND AN AMOUNT OF ` .29,42,831/- WAS ADDED UNDER SECTION 69C OF THE ACT. 4. ON APPEAL, THE LD. CIT(APPEALS), BY FOLLOWING THE ORDER OF THE HIS PREDECESSOR IN ASSESSEES GROUP CONCERN CASE, ALLOW ED THE GROUND RAISED BY THE ASSESSEE. 5. AGGRIEVED, THE REVENUE IS IN APPEAL BEFORE THE TRIBUNAL. 6. THE LD. DR RELIED ON THE ORDER OF THE ASSESSING OFFICER. 7. ON THE OTHER HAND, THE LD. COUNSEL FOR THE ASSE SSEE HAS SUBMITTED THAT THERE WAS SHORT OF CASH AND DULY EXPLAINED BEF ORE THE ASSESSING OFFICER THAT THE DEFICIT CASH WAS GIVEN TO THE OFFICIALS TO MEET THE DAY-TODAY EXPENSES. THE ASSESSING OFFICER HAS WRONGLY INVOKED SECTION 69C OF THE ACT AND STRONGLY SUPPORTED THE ORDER PASSED BY THE LD. CIT(APPEALS). I.T.A. I.T.A. I.T.A. I.T.A. NO. NO. NO. NO.447 447447 447/M/ /M/ /M/ /M/13 1313 13 & & & & C.O. NO. 67/M/13 C.O. NO. 67/M/13 C.O. NO. 67/M/13 C.O. NO. 67/M/13 4 8. WE HAVE HEARD BOTH SIDES, PERUSED THE MATERIALS ON RECORD AND GONE THROUGH THE ORDERS OF AUTHORITIES BELOW. A SEARCH W AS CONDUCTED IN THE PREMISES OF THE ASSESSEE UNDER SECTION 132 OF THE A CT. DURING THE COURSE OF SEARCH, THEY FOUND THAT THERE SHOULD A CASH BALANCE OF ` .49,42,831/-. OUT OF THIS, ` .20,00,000/- WAS DEPOSITED IN BANK AND THERE WAS DE FICIT OF CASH OF ` .29,42,831/-. HOWEVER, NO CASH WAS FOUND DURING THE COURSE OF SEARCH. IT WAS EXPLAINED BEFORE THE ASSESSING OF FICER THAT THE DEFICIT CASH WAS GIVEN TO THE OFFICIALS TO MEET THE DAY-TOD AY EXPENSES. THE ASSESSING OFFICER HAS NOT ACCEPTED THE SUBMISSIONS MADE BY THE ASSESSEE AND THE LD. CIT(APPEALS) HAS ACCEPTED THE SAME SUBMISSIONS BY FOLLOWING THE ORDER OF HIS PREDECESS OR IN ASSESSEES GROUP CONCERN CASE AND DELETED THE ADDITION MADE BY THE ASSESSING OFFICER. WE FIND THAT THE ASSESSING OFFICER WAS NOT CORRECT IN INVOKING SECTION 69C OF THE ACT. THE LD. CIT(APPEALS), AFTER CONSIDERING ENTIRE FACTS AND SUBMISSIONS OF THE ASSESSEE AND ALSO BY F OLLOWING A SIMILAR CASE DECIDED BY HIS PREDECESSOR IN ASSESSEES GROUP CONCERN, DELETED THE ADDITION MADE BY THE ASSESSING OFFICER. THUS, W E FIND NO REASON TO INTERFERE WITH THE ORDER PASSED BY THE LD. CIT(APPE ALS). 9. COMING TO THE CROSS OBJECTION FILED BY THE ASSE SSEE, AT THE TIME OF HEARING, THE LD. COUNSEL FOR THE ASSESSEE HAS NO T PRESSED THE I.T.A. I.T.A. I.T.A. I.T.A. NO. NO. NO. NO.447 447447 447/M/ /M/ /M/ /M/13 1313 13 & & & & C.O. NO. 67/M/13 C.O. NO. 67/M/13 C.O. NO. 67/M/13 C.O. NO. 67/M/13 5 GROUNDS RAISED IN THE CROSS OBJECTION. ACCORDINGLY, THE CROSS OBJECTION FILED BY THE ASSESSEE STANDS DISMISSED AS NOT PRESS ED. 10. IN THE RESULT, THE APPEAL FILED BY THE REVENUE AND CROSS OBJECTION FILED BY THE ASSESSEE ARE DISMISSED. ORDER PRONOUNCED ON TUESDAY, THE 28 TH OF JANUARY, 2014 AT CHENNAI. SD/- SD/- (A. MOHAN ALANKAMONY) ACCOUNTANT MEMBER (V. DURGA RAO) JUDICIAL MEMBER CHENNAI, DATED, THE 28.01.2014 VM/- TO: THE ASSESSEE/A.O./CIT(A)/CIT/D.R.