Dr. Mihir Pal, Hooghly V. JCIT, Range - 55, Kolkata, Kolkata

ITA 45/KOL/2015

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 1085 (ITAT-KOLKATA)
• Duration Of Justice: 2 year(s) 9 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-11-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 26-05-2017
• Assessment Year: 2008-2009
• Appeal Filed On: 13-01-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: P K MONDOL
• Keywords: Gift; Third party statement; Onus to prove
• Section: 143(3); 68; 148

Judgement Text

IN THE INCOME TAX APPELLATE TR IBUNAL KOLKATA SMC BENCH, KOLKATA [BEFORE SRI J. SUDHAKAR REDDY, ACCOUNTANT MEMBER] I.T.A. NO. 45/KOL/2015 ASSESSMENT YEAR: 2008-09 DR. MIHIR PAL.... ..APPELLANT C/O. S.N. GHOSH & ASSOCIATES, ADVOCATES SEVEN BROTHERS LODGE P.O. BUROSHIBTALA P.S. CHINSURAH DIST. HOOGHLY PIN 712 105 [PAN : AFRPP 7763 H] JCIT, RANGE-55, KOLKATA.... ..RESPONDENT INCOME TAX OFFICE 54/1, RAFI AHMED KIDWAI ROAD KOLKATA 700 016 APPEARANCES BY: SHRI SOMNATH GHOSH, APPEARED ON BEHALF OF THE ASSES SEE. SHRI P.K. MONDOL, ADDL. CIT, APPEARING ON BEHALF OF THE REVENUE. DATE OF CONCLUDING THE HEARING : OCTOBER 16 , 2017 DATE OF PRONOUNCING THE ORDER : NOVEMBER 08 , 2017 O R D E R PER J. SUDHAKAR REDDY :- THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAIN ST THE ORDER OF THE LD. COMMISSIONER OF INCOME TAX (APPEALS)-XXXVI, KOLKATA (HEREINAFTER THE LD. CIT (A)), PASSED U/S 250 OF THE INCOME TAX ACT, 1961 (THE ACT), DT. 18/09/2014, FOR THE ASSESSMEN T YEAR 2008-09. 2. THE ASSESSEE IS AN INDIVIDUAL CARRYING ON MEDICA L PROFESSION, SPECIALISING IN RADIOLOGY. HE FILED HIS RETURN OF I NCOME ON 29/07/2008, DECLARING TOTAL INCOME OF RS.5,42,924/-. THE ASSESS ING OFFICER COMPLETED 2 I.T.A. NO. 45/KOL/2015 ASSESSMENT YEAR: 2008-09 DR. MIHIR PAL ASSESSMENT U/S 143(3) ON 16/11/2010, COMPUTING TOTA L INCOME AT RS.21,83,804/-, INTERALIA MAKING ADDITIONS AS FOLLOWS:- 2.1. AGGRIEVED THE ASSESSEE CARRIED THE MATTER IN A PPEAL WITHOUT SUCCESS. FURTHER AGGRIEVED THE ASSESSEE IS IN APPEA L BEFORE US. 3. I HAVE HEARD AT LENGTH, MR. SOMNATH GHOSH, ON BEH ALF OF THE ASSESSEE AND MR. P.K. MONDAL, ACIT, ON BEHALF OF TH E REVENUE. I HAVE ALSO PERUSED THE 88 PAGES PAPER BOOK AND CASE LAW FILED BY THE ASSESSEE. ON CAREFUL CONSIDERATION OF THE FACTS AND CIRCUMSTANCE S OF THE CASE, I HOLD AS FOLLOWS:- 3.1. THE FIRST ADDITION IS OF RS.70,000/-. THE ASSE SSEES CASE IS THAT THIS AMOUNT HAS BEEN RECEIVED FROM FOUR PERSONS AS CASH LOANS I.E. TARUN KUMAR SAHA, KISHORI MOHAN SAHA, PARUL SAHA & NICE KUMA R SAHA. THE ASSESSEE FILED LOAN CONFIRMATION LETTERS, COPY OF T HE PROFIT AND LOSS ACCOUNT AND BALANCE SHEET, COPY OF RECEIPT OF FILIN G OF INCOME-TAX RETURNS OF THESE PERSONS. THE ASSESSING OFFICER DIS BELIEVED THESE LOANS 1. LOAN FROM THIRD PARTIES RS.70,000/- 2. LOAN FROM WIFE RS.55,000/- 3. LOAN + GIFT FROM FATHER RS.1,20,000/- 4. LOAN FROM MOTHER RS.2,50,000/- 5. CASH DEPOSITS BY FATHER (RS.3,38,00/- RS.2,18,000/-) IN HIS BANK ACCOUNT. RS.2,18,000/- 6. CASH DEPOSIT BY MOTHER (RS.11,70,000/- - RS.2,50,000/-) IN HER BANK ACCOUNT. RS.9,20,000/- TOTAL ADDITIONS BY THE LD. ASSESSING OFFICER RS.16,40,880/- 3 I.T.A. NO. 45/KOL/2015 ASSESSMENT YEAR: 2008-09 DR. MIHIR PAL FOR THE REASON THAT THESE PERSONS HAVE NOT APPEARED AFTER SUMMONS U/S 131. THE ASSESSEE RELIES ON THE DECISION OF THE ITA T C BENCH OF THE KOLKATA, TRIBUNAL IN THE CASE OF INDRA CHAND AGARWAL VS. ADDL. COMMISSIONER OF INCOME-TAX, RANGE-1, SILIGURI IN IT A NO. 1027/KOL/2010, ORDER DT. 14/05/2013, I FIND THAT AT PARA 4 PAGE 3 OF THIS ORDER, IT WAS HELD AS FOLLOWS:- 4. WE HAVE HEARD RIVAL SUBMISSIONS AND GONE THROUG H FACTS AND CIRCUMSTANCES OF THE CASE. WE FIND THAT THE ASSESSE E HAS PRODUCED COMPLETE ASSESSMENT PARTICULARS, BALANCE SHEETS, BANK STATEM ENT AND ALSO CONFIRMATIONS. IT IS A FACT THAT ASSESSEE COULD NOT PRODUCE THE CASH CREDITORS BEFORE THE AO. IN SUCH CIRCUMSTANCES, WHETHER THE C ASH CREDITORS CAN BE TREATED AS UNEXPLAINED IN THE ABSENCE OF PRODUCTION BEFORE THE AO. IN SUCH CIRCUMSTANCES, THE LD. COUNSEL FOR THE ASSESSEE REL IED ON VARIOUS CASE LAWS AND ONE PERTINENT CASE LAW OF HON'BLE CALCUTTA HIGH COURT IN THE CASE OF CIT VS. M/S. DATAWARE PRIVATE LIMITED, ITAT NO.263 OF 2 011, GA NO.2856 OF 2011 DATED 21.09.2011, WHEREIN HON'BLE HIGH COURT HAS OB SERVED AS UNDER: 'IN OUR OPINION, IN SUCH CIRCUMSTANCES, THE ASSESSI NG OFFICER OF THE ASSESSEE CANNOT TAKE THE BURDEN OF ASSESSING THE PROFIT AND LOSS ACCOUNT OF THE CREDITOR WHEN ADMITTEDLY THE CREDITOR HIMSELF IS AN INCOME TAX ASSESSEE. AFTER GETTING THE PAN NUMBER AND GETTING THE INFORM ATION THAT THE CREDITOR IS ASSESSED UNDER THE ACT, THE ASSESSING OFFICER SH OULD ENQUIRE FROM THE ASSESSING OFFICER OF THE CREDITOR AS TO THE GENUINE NESS OF THE TRANSACTION AND WHETHER SUCH TRANSACTION HAS BEEN ACCEPTED BY THE A SSESSING OFFICER OF THE CREDITOR BUT INSTEAD OF ADOPTING SUCH COURSE, THE A SSESSING OFFICER HIMSELF COULD NOT ENTER INTO THE RETURN OF THE CREDITOR AND BRAND THE SAME AS UNWORTHY OF CREDENCE. SO LONG IT IS NOT ESTABLISHED THAT THE RETURN SUBMI TTED BY THE CREDITOR HAS BEEN REJECTED BY ITS ASSESSING OFFICER, THE ASSESSI NG OFFICER OF THE ASSESSEE IS BOUND TO ACCEPT THE SAME AS GENUINE WHEN THE IDENTI TY OF THE CREDITOR AND THE GENUINENESS OF TRANSACTION THROUGH ACCOUNT PAYE E CHEQUE HAS BEEN ESTABLISHED. WE FIND THAT BOTH THE COMMISSIONER OF INCOME TAX (A PPEAL) AND THE TRIBUNAL BELOW FOLLOWED THE WELL-ACCEPTED PRINCIPLE WHICH ARE REQUIRED TO BE FOLLOWED IN CONSIDERING THE SHRI INDRA CHAND AGA RWAL, AY: 2006-07 EFFECT OF SECTION 68 OF THE ACT AND WE THUS FIND NO REASON TO INTERFERE WITH THE CONCURRENT FINDINGS OF FACT RECORDED BY BOTH THE AU THORITIES. THE APPEAL IS THUS DEVOID OF ANY SUBSTANCE AND IS S UMMARILY DISMISSED.' 4 I.T.A. NO. 45/KOL/2015 ASSESSMENT YEAR: 2008-09 DR. MIHIR PAL 7. WE FIND THAT IN THE PRESENT CASE ALSO THE ASSESS EE HAS DISCHARGED ITS ONUS BY FILING CONFIRMATIONS FROM THE DONORS, COPIES OF ACKNOWLEDGMENT OF RETURNS OF THE RELEVANT ASSESSMENT YEAR, COPIES OF PAN CARD , COPIES OF BANK STATEMENTS AND ALSO CONTRA CONFIRMATION. ONCE THIS IS THE POSITION AND NONE OF THE AUTHORITIES BELOW HAVE GONE INTO THE DETAILS AND NOT DOUBTED THE GENUINENESS OF THE TRANSACTION OR THE CREDITWORTHIN ESS OF THESE CREDITORS, IN OUR VIEW, NOW NOTHING BEFORE US REMAINS AFTER THE D ECISION OF HON'BLE CALCUTTA HIGH COURT IN THE CASE OF M/S. DATAWARE PR IVATE LIMITED (SUPRA). RESPECTFULLY FOLLOWING THE SAID DECISION IN THE CAS E OF M/S. DATAWARE PRIVATE LIMITED (SUPRA), WE ARE OF THE VIEW THAT IN THE ABS ENCE OF ANY ENQUIRY FROM THE AO OF THE CREDITORS, THE AO CANNOT MAKE THE ADD ITION IN THE HANDS OF THE ASSESSEE BY TREATING THE LOANS RECEIVED BY ASSESSEE AS UNEXPLAINED. WE DELETE THE SAME AND ALLOW THE APPEAL OF ASSESSEE. 3.1.1. THE FACTS OF THE PRESENT CASE ARE SIMILAR T O THAT OF THE FACTS OF THE CASE OF INDRA CHAND AGARWAL (SUPRA) . RESPECTFULLY FOLLOWING THE PROPOSITIONS OF LAW LAID DOWN THEREIN, I DELETE THI S ADDITION AS THE ASSESSEE HAS DISCHARGED THE BURDEN OF PROOF THAT LA Y ON HIM. 4. THE NEXT ADDITION RELATES TO A LOAN TAKEN FROM T HE WIFE OF THE ASSESSEE OF RS.55,000/-. THE ASSESSE FILED COPIES O F SALARY CERTIFICATE, HER INCOME-TAX RETURN COPIES ALONG WITH PROFIT AND LOSS ACCOUNT AND BALANCE SHEET. THE AMOUNT WAS PAID BY WAY OF ACCOUN T PAYEE CHEQUE AND A COPY OF THE LOAN CONFIRMATION WAS FILED. THE ASSESSING OFFICER MADE THE ADDITION ON THE GROUND THAT HER EARNINGS F ROM SALARY WAS VERY LOW AND THERE WAS NO SUBSTANTIVE EVIDENCE THAT SHE EARNED FROM TUITION INCOME. IN MY VIEW, THE ADDITION IS NOT SUSTAINABLE . WHEN A PERSON DISCLOSES A PARTICULAR INCOME AND FILES THE RETURN OF INCOME AND PAYS TAXES THEREON, IT IS NOT CORRECT TO HOLD THAT SHE C OULD NOT PROVE WITH 5 I.T.A. NO. 45/KOL/2015 ASSESSMENT YEAR: 2008-09 DR. MIHIR PAL EVIDENCE, THE INCOME SO DECLARED AND HENCE IT WAS T HE MONEY/INCOME OF SOMEBODY ELSE THAT SHE DECALRED. THE RETURN OF INCO ME OF SMT. DIPANWITA PAL, WAS ACCEPTED. INCOME FROM TUITIONS C ANNOT BE SUBSTANTIATED BY WAY OF EXTENSIVE DOCUMENTATION. TH E ASSESSEE HAS DISCHARGED THE BURDEN OF PROOF THAT LAY ON HIM. HEN CE THIS ADDITION IS HEREBY DELETED. 5. THE NEXT ADDITION IS OF THE LOAN AND GIFT RECEIV ED BY THE ASSESSEE FROM HIS FATHER. THE ASSESSEE FILED THE COPY OF THE INCOME-TAX RETURN OF SHRI SAMBHU NATH PAL, THE FATHER OF THE ASSESSEE. THE ASSESSMENT OF SHRI SAMBHU NATH PAL, WAS RE-OPENED U/S 148 AND AN ORDER U/S 143(3) R.W.S. 147 OF THE ACT WAS PASSED ON 27/11/2013. SHRI SAMBHU NATH PAL HAD FILED CONFIRMATION LETTER FOR THE LOAN, AS WELL AS A COPY OF GIFT DEED. THE ASSESSING OFFICER IN MY OPINION, WAS WRONG IN REJEC TING THESE EVIDENCES. IN FACT, THE BANK ACCOUNT HELD BY THE FATHER JOINTL Y IN THE NAME OF THE ASSESSEE WAS ALSO CONSIDERED IN THIS PARTICULAR ASS ESSMENT ORDER. THUS, THIS ADDITION OF RS.2,18,000/-, MADE ON THE GROUND THAT THERE ARE CERTAIN UNEXPLAINED DEPOSITS IN THE SAID BANK ACCOUNTS, IS ALSO TO BE DELETED. WHEN THE ASSESSING OFFICER HAS ACCEPTED THE CLAIM O F SHRI SAMBHU NATH PAL, THAT HE IS IN THE BUSINESS OF FARIA AND THE DEPOSITS IN THE SAID BANK ACCOUNT BELONG TO HIM IN HIS INCOME TAX PROCEEDINGS , NO ADDITION CAN BE MADE IN THE HANDS OF THE ASSESSEE. IN MY VIEW, THE ASSESSEE HAS DISCHARGED THE BURDEN OF PROOF THAT LAY ON HIM. 5.1. IN THE RESULT, THIS ADDITION OF RS.3,38,000/- I.E., RS.1,20,000/- BEING LOAN AND GIFT FROM FATHER OF RS.2,18,000/-, C ASH DEPOSIT IN THE FATHERS BANK ACCOUNT ARE HEREBY DELETED. 6 I.T.A. NO. 45/KOL/2015 ASSESSMENT YEAR: 2008-09 DR. MIHIR PAL 6. THE LAST ADDITION IS THAT OF A LOAN OF RS.2,50,0 00/- TAKEN BY THE ASSESSEE FROM HIS MOTHER AND A CASH DEPOSIT OF RS.9 ,20,000/- IN THE ACCOUNT OF THE MOTHER. HERE ALSO, THE MOTHER OF THE ASSESSEE SMT. MAYA RANI PAUL, IS ASSESSED TO TAX. SHE FILED HER RETURN OF INCOME. THE ASSESSING OFFICER RE-OPENED THE ASSESSMENT BY ISSUA L OF NOTICE U/S. 148 OF THE ACT. THEREAFTER, AN ASSESSMENT ORDER WAS PAS SED U/S 143(3) R.W.S. 147 OF THE ACT, ON 27/11/2013 ACCEPTING THE CLAIM O F THE MOTHER SMT. MAYA RANI PAUL, THAT THE BANK ACCOUNTS IN QUESTION BELONGS TO HER. WHEN THE MOTHER OF THE ASSESSEE CONFIRMS THE TRANSA CTIONS IN QUESTION AND FURNISHES COPIES OF HER INCOME-TAX RETURNS AND COPIES OF HER ASSESSMENT ORDER, IN SUPPORT OF THE CONTENTIONS, IN MY VIEW, THE BURDEN OF PROOF THAT LAY ON THE ASSESSEE IS DISCHARGED. TH E FACT THAT THIS AGED COUPLE DID NOT APPEAR BEFORE THE ASSESSING OFFICER, CANNOT LEAD TO A CONCLUSION THAT THE IDENTITY, CREDITWORTHINESS AND GENUINENESS OF THE TRANSACTIONS IS NOT PROVED, SPECIFICALLY IN THE LIG HT OF THE OVERWHELMING EVIDENCE FILED BY THE ASSESSEE. IN THE RESULT, THIS ADDITION OF RS.2,50,000/-, BEING LOAN FROM MOTHER AND RS.9,20,0 00/-, BEING CASH DEPOSITED IN THE BANK ACCOUNT HELD BY THE MOTHER JO INTLY WITH THE ASSESSEE IS HEREBY DELETED. 7. IN THE RESULT, ALL THE GROUNDS OF APPEAL OF THE ASSESSEE ARE ALLOWED. KOLKATA, THE 8 TH DAY OF NOVEMBER, 2017. SD/- [ J. SUDHAKAR REDDY ] ACCOUNTANT MEMBER DATED : 08.11.2017 {SC SPS} 7 I.T.A. NO. 45/KOL/2015 ASSESSMENT YEAR: 2008-09 DR. MIHIR PAL COPY OF THE ORDER FORWARDED TO: 1. DR. MIHIR PAL C/O. S.N. GHOSH & ASSOCIATES, ADVOCATES SEVEN BROTHERS LODGE P.O. BUROSHIBTALA P.S. CHINSURAH DIST. HOOGHLY PIN 712 105 2. JCIT, RANGE-55, KOLKATA INCOME TAX OFFICE 54/1, RAFI AHMED KIDWAI ROAD KOLKATA 700 016 3. CIT(A)- 4. CIT- , 5. CIT(DR), KOLKATA BENCHES, KOLKATA. TRUE COPY BY ORDER SENIOR PRIVATE SECRETARY HEAD OF OFFICE/ D.D.O. ITAT, KOLKATA BENCHES