HEMLATA J. BHANDARI, MUMBAI V. ITO 25(3)(2), MUMBAI

ITA 4638/MUM/2008

• Counselvise Citation: [2014] 120 COUNSELVISE.COM (IT) 8096 (ITAT-MUMBAI)
• Duration Of Justice: 6 year(s) 3 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-10-2014
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: H
• Next Hearing Date: 18-08-2014
• Assessment Year: 2005-2006
• Appeal Filed On: 09-07-2008
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: ASGHAR ZAIN
• Assessee Lawyers: SANJUKTA CHOW DHURY
• Keywords: Unexplained investment; Gift; Business income; Principle of natural justice; Peak credit
• Section: 68

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL H , BENCH MUMBAI , BEFORE : SHRI R.C.SHARMA , A M & SHRI SANJAY GARG, J M ITA NO. 4638/ MUM/20 08 ( ASSESSMENT YEAR :2005 - 06 ) SMT.HEMLATA J. BHANDARI, FLAT NO.607, JEEVANSWAPNA, PATEL NAGAR, M.G.ROAD, KANDIVALI (WEST), MUMBAI - 400 067 VS. ITO 25(3)(2), MUMBAI - 400 051 PAN/GIR NO. : A GE PP 9278 P ( APPELLANT ) .. ( RESPONDENT ) AND ITA NO. 4920/ MUM/20 08 ( ASSESSMENT YEAR :2005 - 06 ) ITO 25(3)(2), MUMBAI - 400 051 VS. SMT.HEMLATA J. BHANDARI, FLAT NO.607, JEEVANSWAPNA, PATEL NAGAR, M.G.RO AD, KANDIVALI (WEST), MUMBAI - 400 067 PAN/GIR NO. : A GEPP 9278 P ( APPELLANT ) .. ( RESPONDENT ) /ASSESSEE BY : SHRI PRAMOD KUMAR PARIDA & MS. SANJUKTA CHOWDHURY /REVENUE BY : SHRI ASGHAR ZAIN DATE OF HEARING : 25 TH SEPT , 201 4 DATE OF PRONOUNCEMENT : 17 TH OCT , 201 4 O R D E R PER R.C.SHARMA ( A .M.) : TH ESE ARE THE CROSS APPEALS FILED BY ASSESSEE AND REVENUE AGAINST THE ORDER OF CIT(A ) , DATED 9 - 5 - 2008 FOR THE ASSESSMENT YEAR 200 5 - 06 , IN THE MATTER OF ORDER PASSED U/S. 143 ( 3 ) OF TH E I.T. ACT RW.S.145(3) OF THE I.T.ACT. ITA NO. 4638&4920 / 08 2 2 . INITIALLY, T HE ASSESSEE IN ITS APPEAL I.E. ITA NO. 4638/MUM/2008 HAS RAISED THE FOL LOWING GROUNDS : - 1. THE LEARNED CIT (A)XXV, HAS GIVEN A RELIEF TO THE TUNE OF RS.8,99,577/ - AS AGAINST THE ADDITIONS MADE BY THE ASSESSING OFFICER TO RS.15,39,695/ - , BUT WHILE CONSIDERING THE PEAK THEORY SHE HAS FURTHER ADDED RS.72,000/ - IS AGAINST THE P RINCIPLE OF NATURAL JUSTICE. 2. THE LEARNED ASSESSING OFFICER HAS CONFIRMED THE ADDITIONS OF RS.1,40,000/ - AS UNDISCLOSED JEWELRY AND ADDED IN INCOME IS NOT JUSTIFY WITH REFERENCE TO THE FACT. THIS ADDITION BASED ON THE PRESUMPTION IS REQUESTED TO BE DE LETED. 3. AGAINST THE INVESTMENT IN IMMOVABLE PROPERTY, ADDITION OF RS.25,000/ - IS CONFIRMED BY THE CIT IS NOT JUSTIFY, AS THIS EXPENSES ARE MADE TO THE PAYMENT OF ADVOCATE AND BROKERS. THE PROPERTY IS PURCHASED IN THE EARLIER YEARS AND ON THE SAME BASE S THIS ADDITIONS IS NOT JUSTIFY. 4. INVESTMENT MADE DURING THE YEAR RS.60,000/ - IN NSC SHOULD BE ALLOWABLE AND CAN NOT BE ADDED IN THE INCOME AND THE BENEFIT U/S.80(C) SHOULD BE GRANTED. 5. INVESTMENT OF RS.93,600/ - MADE IN PPF, CASH ACCOUNT, INVESTM ENT IN POST OFFICE AND MAHILA PRADHAN KSHATRIYA BACHAT YOJANA IS CONFIRMED AS AN ADDITIONS TO THE INCOME DURING THE YEAR IS AGAINST THE PRINCIPLE OF NATURAL JUSTICE. 6. PENALTY LEVIED U/S234(A),234(B) AND 234(C) IS NOT JUSTIFIED. THEREAFTER THE ASSESS EE RAISED AN ADDITIONAL GROUND WHICH IS AS UNDER : - 1. BOOKS REJECTED - PROFITS NOT ESTIMATED FOR PRESUMPTIVE TAX U/S. 44AF THE LD. CIT(A) ERRED IN CONFIRMING THE REJECTION OF BOOKS AND NOT ESTIMATING THE PROFIT ON PRESUMPTIVE BASIS U/S. 44AF AND FURTHE R ERRED IN MAKING ITEM - WISE SCRUTINY OF TRANSACTIONS IN ORDER TO MAKE SEPARATE - SEPARATE ADDITIONS. THE CASE OF THE ASSESSEE MAY BE ACCEPTED FOR PRESUMPTIVE TAX U/S. 44AF AS HER TOTAL TURNOVER DOES NOT EXCEED RS. 40 LACS NOR SHE, ADMITTEDLY, MAINTAINS ANY BOOKS. 3 . THE REVENUE IN ITS APPEAL I.E. ITA NO. 4920 /MUM/2008 HAS TAKEN THE FOLLOWING GROUNDS : - 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, AND IN LAW, THE ID. CIT(A) ERRED IN RESTRICTING THE ADDITION MADE BY THE ASSESSING OFFICER U/S. 68 OF THE IT ACT, TO RS.6,39, 118/ - AS AGAINST RS.15,38,695/ - , BY APPLYING 'PEAK CREDIT' METHOD. ITA NO. 4638&4920 / 08 3 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, AND IN LAW, THE ID. CIT(A) ERRED IN RESTRICTING THE ADDITION MADE BY THE ASSESSING OFFICER U/S. 68 OF THE IT A CT, TO RS.1,40,000/ - AS AGAINST RS.2,80,000/ - BY ESTIMATING THE POSSESSION OF JEWELLERY BY THE ASSESSEE WITHOUT ANY BASIS. 3. THE APPELLANT PRAYS THAT THE ORDER OF THE CIT(A) ON THE ABOVE GROUNDS TO BE SET ASIDE AND THAT OF THE AO BE RESTORED. 4 . WE HA VE CONSIDERED RIVAL CONTENTIONS AND PERUSED THE RECORD. FACTS IN BRIEF ARE THAT THE ASSESSEE IS A LADY INDIVIDUAL. DURING THE COURSE OF SCRUTINY ASSESSMENT, THE AO OBSERVED THAT THE ASSESSEE HAS FILED A RETURN OF INCOME DECLARING INCOME OF RS. 2,21,686/ - WH ICH COMPRISES OF INCOME FROM HOUSE PROPERTY , BUSINESS INCOME AND INCOME FROM OTHER SOURCES. THE AO ALSO NOTED THAT RETURN WAS ACCOMPANIED BY STATEMENT OF COMPUTATION OF TOTAL INCOME, BALANCE SHEET AND PROOF OF PAYMENT OF LIC PREMIUMS AND NSC INVESTMENT. TH E AO FURTHER STATED THAT AS PER INFORMATION RECEIVED THROUGH AIR, THE ASSESSEE DEPOSITED CASH OF RS. 11,10,500/ - IN HER BANK ACCOUNT MAINTAINED WITH CANARA BANK. ASSESSEE WAS CALLED IN THE OFFICE AND HER STATEMENT WAS RECORDED U/S.131 OF THE I.T.ACT ON 1 - 11 - 2007 , WHEREIN SHE STATED THAT SHE WAS RUNNING FRUIT JUICE CENTRE AT FOOTPATH OF KANDIVALI. THE AO ALSO RECORDED HER STATEMENT WITH REGARD TO JEWELLERY AND OTHER ASSETS POSSESSED BY HER WHICH WAS REFLECTED IN THE BALANCE SHEET ALONG WITH THE RETURN OF INCO ME. SHE FURTHER STATED THAT THERE WERE TOTAL FIVE JUICE CENTRES DURING THE YEAR AND TWO YEARS BACK TWO JUICE CENTRES WERE THERE AND SHE WAS RUNNING THE JUICE CENTRE ON ROAD WITHOUT ANY PERMANENT SHOP. THE PLACES OF THE AFORESAID JUICE CENTRES ARE 1) PATE L NAGAR NAKA (NEAR RAHUL BUILDING), 2 ND MAHAVIR NAGAR IN BETWEEN (NEAR KAMALA ASHISH BUILDING), 3 RD CHATKPAL (NEAR ZUNKA BHAKAR KENDRA) , 4 TH POISAR MARKET IN FRONT OF ITA NO. 4638&4920 / 08 4 CHURCH ) AND 5 TH AT CHIKUWADI, SHIMPOLI ROAD (NEAR GARDEN). WITH REGARD TO AOS QUESTION R EGARDING THE PERSONS WITH WHOSE HELP SHE WAS RUNNING THE JUICE CENTRES, THE ASSESSEE STATED THAT EACH CENTRE WAS HAVING 2 - 2 MANPOWER, WHO WERE PAID RS. 200/ - PER DAY. THE NAME AND ADDRESS OF THESE PERSONS W ERE ALSO ASKED BY THE AO AND THE WAS DULY REPLIED B Y THE ASSESSEE. WITH REGARD TO THE PURCHASES OF FRESH JUICE ALSO SHE WAS ASKED FOR WHICH SHE REPLIED THAT SHE WAS PURCHASING FRUITS ON ALTERNATE DAY WITH THE HELP OF HIS BROTHER AT VASHI AND FRESH FRUITS OF RS. 5000/ - WERE PURCHASED AND THE SAME WERE DISTRI BUTED TO FIVE JUICE CENTRES . THE COLLECTION OF THE EACH JUICE CENTRE WAS ALSO ASKED FOR WHICH SHE REPLIED THAT EACH DAY APPROXIMATELY RS.500/ - TO RS.5000/ - WAS EARNING FROM THE EACH OF FIVE JUICE CENTRES. REGARDING WRITING OF BOOKS OF ACCOUNT, IT WAS STATE D THAT SHE DID NOT MAINTAIN ANY BOOKS OF ACCOUNTS . SHE FURTHER RECORDED HER STATEMENT THAT IN THE YEAR 2004 - 05 SHE HAS DEPOSITED CASH AMOUNT WHICH WAS COMING FROM JUICE CENTRE. WITH REGARD TO THE PROPERTY POSSESSED BY HER , SHE STATED THAT SHE HAS FOUR ROOM S IN JHOPADPATTI AND ONE FLAT IN JEEVAN SAPNA. SHE ALSO STATED THAT SHE WAS LIVING WITH HER TWO KIDS AND HUSBAND WAS NEITHER LIVING WITH HER NOR SUPPORTING HER FOR WHICH SHE STARTED THE AFORESAID BUSINESS TO RUN HER LIVELIHOOD. 5 . THE AO DID NOT ACCEPT AS SESSEES CONTENTION FOR RUNNING OF ANY JUICE CENTRE . THE AO ALSO DID NOT ACCEPT ASSESSEES CONTENTION WITH REGARD TO DEPOSIT OF MONEY IN THE BANK OUT OF CASH RECEIPTS ON JUICE SALES. THE AO ALSO OBSERVED THAT AS PER PROVISIONS OF SECTION 44AA(2)(I) OF THE ACT, THE PROFIT ON JUICE CORNER OFFERED AT RS. 1,76,545/ - , WHICH WAS MORE THAN THE PRESCRIBED LIMIT OF RS. 1,20,000/ - , THEREFORE, ASSESSEE WAS ITA NO. 4638&4920 / 08 5 STATUTORILY REQUIRED TO MAINTAIN BOOKS OF ACCOUNT. ACCORDINGLY, THE AO PROCEEDED TO ADD THE ENTIRE AMOUNT OF CASH D EPOSIT ED IN THE BANK ACCOUNT AS INCOME FROM OTHER SOURCES WITHOUT GIVING ANY CREDIT FOR THE CASH WITHDRAWN FROM THE VERY SAME BANK ACCOUNT AND ALSO WITH REGARD TO THE INCOME DECLARED BY THE ASSESSEE WHICH WAS AVAILABLE WITH HER IN CASH. 6 . BY THE IMPUGNED ORDER, THE CIT(A) ALLOWED CREDIT OF CASH WITHDRAWN FROM THE VERY SAME BANK ACCOUNT AND ADDED THE DIFFERENCE IN SHORTAGE OF CASH AVAILABLE AMOUNTING TO RS. 5,67,118/ - . AGAINST THIS ORDER OF CIT(A), BOTH ASSESSEE AND REVENUE ARE IN APPEALS BEFORE US. 7 . WE H AVE CONSIDERED RIVAL CONTENTIONS, CAREFULLY GONE THROUGH THE ORDER OF THE LOWER AUTHORITIES AS WELL AS THE STATEMENT OF ASSESSEE RECORDED UNDER SECTION 131. WE FOUND THAT ASSESSEE BEING LIVING WITH HER TWO KIDS WITHOUT HUSBAND, WAS CARRYING ON JUICE CORNER S AND SHE HAS REPLIED EACH AND EVERY QUESTION ASKED BY THE AO AS TO HOW SHE WAS CARRYING ON THE JUICE CENTRES. WE, THEREFORE, DO NOT FIND ANY MERIT IN THE ACTION OF THE AO FOR DECLINING ASSESSEES CLAIM OF RUNNING THE JUICE CENTRES. 8 . SO FAR AS APPLICA BILITY OF SECTION 44AF IS CONCERNED, THE CONTENTION OF THE LEARNED AR WAS THAT SINCE THE TURNOVER OF THE JUICE BUSINESS WAS LESS THAN RS. 40 LAKHS I.E. RS. 4,43,800/ - , THE LOWER AUTHORITIES SHOULD HAVE APPLIED PROVISION OF SECTION 44A F AND SHOULD HAVE ASSESS ED ASSESSEES INCOME AS INCOME FROM JUICE CORNER AT THE RATE OF 5% OF THE SALES AND NO OTHER ADDITION ON ACCOUNT OF DEPOSIT OF CASH IN BANK SHOULD BE MADE . WE DO NOT FIND ANY MERIT IN THE CONTENTION OF THE LEARNED AR INSOFAR AS 5% OF ITA NO. 4638&4920 / 08 6 SALES WORKS OUT TO BE RS. 21,190/ - , WHEREAS THE ASSESSEE HERSELF HAS OFFERED THE NET PROFIT OF RS. 1,76,545/ - , HENCE, T HE PROVISIONS OF SECTION 44AF IS NOT APPLICABLE. AS PER PROVISIONS OF SECTION 44AF, IF THE ASSESSEE DOES NOT MAINTAIN ANY BOOKS OF ACCOUNTS THEN IN CASE OF RETAI L TRADE HER INCOME IS TO BE ESTIMATED AT 5% OF TURNOVER , HOWEVER, IN THE INSTANT CASE ASSESSEE HAS HERSELF OFFERED NET PROFIT OF RS. 1,76,545/ - , WHICH IS HIGHER THAN THE SALES. THERE IS NO REASON TO APPLY SECTION 44AF. THE CONTENTION OF THE LD. AR THAT THE AMOUNT OF CASH DEPOSIT IN THE BANK ACCOUNT WAS OUT OF THE BUSINESS OF JUICE CENTRE ALSO CANNOT BE ACCEPTED INSOFAR AS THE AMOUNT DEPOSITED IN THE BANK WAS MUCH MORE THAN THE GROSS AMOUNT COLLECTED OUT OF THE JUICE BUSINESS. IT WAS THE CONTENTION OF THE LEA RNED AR THAT ONCE THE 44AF IS APPLICABLE, NO SEPARATE ADDITION IS TO BE MADE IN RESPECT OF CASH DEPOSIT IN THE BANK ACCOUNT AND TOTAL INCOME IS TO BE ASSESSED AT 5% OF THE SALES. W E DO NOT FIND ANY MERIT IN THE CONTENTION OF THE LEARNED AR AND, THEREFORE, HELD THAT ASSESSEE HAS HAVING NET PROFIT OF RS. 1,76,545/ - FROM HER JUICE CENTRES. 9 . NOW, COMING TO THE ADDITION CONFIRMED BY THE CIT(A) IN RESPECT OF THE CASH DEPOSIT IN THE BANK ACCOUNT, THE C IT(A) HAS ALREADY GIVEN CREDIT OF THE CASH WITHDRAWN FROM T HE VERY SAME BANK ACCOUNT AND UTILIZED FOR THE DEPOSIT IN THE VERY SAME BANK ACCOUNT, HOWEVER, HE HAS NOT GIVEN THE CREDIT FOR THE INCOME EARNED AND RETURN ED BY HER WHICH WAS AVAILABLE TO THE ASSESSEE IN THE FORM OF CASH. ACCORDINGLY, WE MODIFY THE ORDER O F THE LOWER AUTHORITIES AND DIRECT TO REDUCE THE INCOME OF RS. 2, 21 ,686/ - OFFERED BY THE ASSESSEE AS AVAILABLE WITH HER FOR DEPOSIT IN THE BANK ACCOUNT. ITA NO. 4638&4920 / 08 7 ACCORDINGLY, THE ADDITION U/S. 68 OF THE ACT IS RESTRICTED TO RS . 3 , 45 , 432 / - (RS. 5,67,118 - 2,21,686) . 10 . THE AO ALSO MADE AN ADDITION OF RS.2,80,000/ - ON ACCOUNT OF JEWELLERY. IT WAS THE CONTENTION OF THE ASSESSEE BEFORE THE LOWER AUTHORITIES THAT ASSESSEE RECEIVED JEWELLERY DURING HER MARRIAGE AND GIFT FROM VARIOUS RELATIVES, WHICH WAS SOLEMNIZED BEFORE 22 YEARS. HOWEVER, THE AO DID NOT ACCEPT THE SAME AND MADE AN ADDITION IN RESPECT OF JEWELLERY OF 400 GMS. BY THE IMPUGNED ORDER, THE CIT(A) HAS REDUCED THE ADDITION ON ACCOUNT OF JEWELLERY TO 50% AMOUNTING TO RS. 1,40,000/ - BY ACCEPTING THE FACT THAT THE ASSE SSEE IS A LADY WHO GOT MARRIED BEFORE 22 YEARS AND,HENCE, SOME JEWELLERY IS TO BE ACCEPTED AS MUCH AS HAS BEEN OWNED BY HER. BOTH ASSESSEE AND REVENUE ARE IN APPEAL BEFORE US. 10.1 WE HAVE CONSIDERED RIVAL CONTENTIONS AND FOUND THAT ASSESSEE, WHO IS A LADY , WAS LIVING WITH HER TWO KIDS. SHE WAS MARRIED 22 YEARS BACK, BEING A HINDU LADY IT CAN REASONABLE BE PRE SUMED THAT SHE HAD BEEN GIVEN SOME JEWELLERY BOTH FROM H ER PARENT SIDE AS WELL AS FROM HER IN - LAWS SIDE. SOME JEWELLERY WAS ALSO GIVEN BY HER HUSBAN D. EVEN THE CBDT CIRCULAR NO. 1916, DATED 11 - 5 - 1994 GIVEN AN INSTRUCTION THAT MARRIED WOMEN CAN HAVE GOLD OF 500 GMS. FOR THIS PURPOSE, RELIANCE MAY BE PLACED ON THE DECISION REPORTED IN 158 TAXMAN 170 AS WELL AS DECISION OF THE AHMADABAD BENCH OF THE TRIB UNAL IN THE CASE OF RAMESH CHANDRA R.PATEL, 89 ITD 203 (AHD), IN WHICH IT WAS HELD THAT INSTRUCTION NO. 1916 OF CBDT DATED 11 - 5 - 1994 SPEAKS OF NOT SEIZING OF JEWELLERY, THE EXTENDED MEANING OF THE SAME SHOWS THE INTENTION THAT THE JEWELLERY IS TO BE TREATED AS EXPLAINED ONE TO THE EXTENT OF 500 GMS IN THE CASE OF ITA NO. 4638&4920 / 08 8 MARRIED LADY. KEEPING IN VIEW OF THE FACTS AND CIRCUMSTANCES OF THE CASE, VIS - - VIS CBDT CIRCULAR NO. 1916, WE DO NOT FIND ANY MERIT IN THE ADDITION MADE BY THE AO AND REDUCED BY THE CIT(A) UPTO 50% I.E. RS. 1,40,000/ - ON ACCOUNT OF JEWELLERY. 11 . WITH REGARD TO THE INVESTMENT OF RS. 5,75,000/ - , THE CIT(A) AFTER EXAMINING THE BALANCE SHEET OF EARLIER YEARS RECORDED A CATEGORICAL FINDING THAT ALL THESE INVESTMENTS WERE MADE IN THE EARLIER YEARS AND THAT ASSESSEE CONSOLIDATED HER ASSTS AND BROUGHT ALL THE ASSETS TO THE BALANCE SHEET OF THE YEAR UNDER CONSIDERATION EVEN THOUGH INVESTMENT WAS MADE IN EARLIER YEARS. TOTAL INVESTMENT IN ROOMS WERE SHOWN AT RS. 6 LAKHS WHILE ASSESSEE COULD PROVE FROM AGREEMENTS THE INVESTMENT OF RS. 5,75,000/ - IN EARLIER YEARS. ACCORDINGLY, CIT(A) CONFIRMED THE BALANCE ADDITION OF RS. 25000/ - . THE FINDINGS RECORDED BY THE CIT(A) HAVE NOT BEEN CONTROVERTED. THEREFORE, WE DO NOT FIND ANY REASON TO INTERFERE IN THE ORDER OF CIT(A) . A CCORDINGLY, WE CONFIRM THE ACTION OF THE CIT(A) UPHOLDING THE ADDITION OF RS. 25000/ - ON ACCOUNT OF INVESTMENT IN ROOMS. 12 . THE AO HAS ALSO MADE AN ADDITION OF RS. 2,27,424/ - ON ACCOUNT OF PAYMENT MADE FOR FLAT TO M/S J.P. ENTERPRISES. THE CIT(A) DELETED T HE SAME AFTER OBSERVING THAT PAYMENT WAS MADE FROM THE BANK ACCOUNT NO. SB 73952 IN CANARA BANK ON 23 - 3 - 2005 BY ACCOUNT PAYEE CHEQUE NO. 227424. THE CIT(A) FURTHER OBSERVED THAT SINCE THE CASH SHORTAGE HAS ALREADY BEEN ADDED WITH REGARD TO DEPOSIT IN THE ABO VE STATED BANK ACCOUNT, FURTHER ADDITION ON ACCOUNT OF PAYMENT MADE FROM THE VERY SAME ACCOUNT THROUGH ACCOUNT PAYEE CHEQUE WILL AMOUNT TO DOUBLE ADDITION. ITA NO. 4638&4920 / 08 9 12.1 WE HAVE CONSIDERED RIVAL CONTENTION AND FOUND THAT PAYMENT OF RS. 2 ,27,424/ - WAS MADE OUT OF TH E BANK ACCOUNT WHICH HAS ALREADY BEEN CONSIDERED BY THE AO AND ADDITION HAS ALREADY BEEN MADE IN RESPECT OF CASH DEPOSIT ED IN THE BANK ACCOUNT WHICH BROUGHT CREDIT BALANCE IN HER BANK ACCOUNT OUT OF WHICH THIS AMOUNT OF RS. 2,27,424/ - WAS PAID BY CHEQUE . AC CORDINGLY, WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF CIT(A) FOR DELETING THE ADDITION OF RS. 2,27,424/ - . 13 . WITH REGARD TO THE ADDITION OF RS. 60,000/ - MADE ON ACCOUNT OF INVESTMENT IN NSCS, THE CIT(A) AFTER VERIFYING THE DATE OF PURCHASES OF NSC CAME TO THE CONCLUSION THAT ALL THE NSCS WERE PURCHASED IN CASH AND THE AVAILABLE CASH WIT H ASSESSEE HAVE ALREADY BEEN CONSIDERED WHILE WORKING OUT NEGATIVE CASH BALANCE AT BANK. ACCORDINGLY, IT WAS HELD THAT ADDITION OF RS. 60,000/ - WAS CORRECTLY MADE BY THE AO O N ACCOUNT OF UNEXPLAINED INVESTMENT IN NSCS. THE FINDINGS RECORDED BY THE CIT(A) HAS NOT BEEN CONTROVERTED BY THE LEARNED A R. ACCORDINGLY, WE DO NOT FIND ANY REASON TO DEVIATE FROM THE CONCLUSION DRAWN BY THE CIT(A) RESULTING INTO THE ADDITION OF RS. 60,000 / - ON ACCOUNT OF INVESTMENT IN NSCS. 14 . WITH REGARD TO LOANS AND ADVANCES OF RS. 1,00,000/ - MADE ON 4 - 10 - 2004 BY ISSUING CHEQUE FROM CANARA BANK, THE CIT(A) HAS DELETED THE SAME BY OBSERVING THAT THE SAID BANK ACCOUNT HAS ALREADY BEEN CONSIDERED AS A WHOLE AND SINCE THE ADDITION ON ACCOUNT OF CASH DEPOSIT IN THE BANK ACCOUNT HAS ALREADY BEEN MADE, THERE IS NO REASON FOR MAKING SEPARATE ADDITION OF ANY CHEQUE ISSUED OUT OF THIS BANK ACCOUNT. 14.1 WE HAVE CONSIDERED RIVAL CONTENTIONS AND FOUND THAT ASSESSEE H AS GIVEN LOAN OF RS. 1 LAKHS ON 4 - 10 - 2004 TO SUDHA P. VYAS. SINCE THE ITA NO. 4638&4920 / 08 10 ADVANCE WAS MADE FROM THE BANK ACCOUNT ALREADY CONSIDERED BY THE AO AND ADDITION HAS ALREADY BEEN MADE ON ACCOUNT OF CASH SHORTAGE ON THE DATE OF CASH DEPOSITS IN THE CANARA BANK ACCOUNT, THERE IS NO INFIRMITY IN THE ORDER OF CIT(A) FOR DELETING THE ADDITION OF RS. 1,00,000/ - MADE FOR ISSUANCE OF CHEQUES OUT OF DISCLOSED BANK ACCOUNT. IT AMOUNTS TO DOUBLE ADDITION, ONCE ON ACCOUNT OF CASH DEPOSITS AND SECOND ON ACCOUNT OF ISSUANCE OF CHEQUE S OUT OF THE VERY SAME BANK ACCOUNT. 15 . WITH REGARD TO THE ADDITION OF RS. 93,600/ - MADE ON ACCOUNT OF DEPOSIT IN PPF OF RS. 12,000/ - , INVESTMENT IN POST OFFICE RS. 33,600/ - , INVESTMENT IN MAHILA PRADHAN KSHETRIYA BACHAT YOJANA RS. 33,000/ - AND CASH IN HAND O F RS. 15,000/ - , WE FOUND THAT ASSESSEE WAS ALREADY HAVING SHORTAGE OF CASH. ACCORDINGLY, THE CIT(A) CONFIRMED THE ADDITION AS UNEXPLAINED INVESTMENTS. HENCE, WE DO NOT FIND ANY REASON TO INTERFERE IN THE ORDER OF CIT(A) FOR CONFIRMING THE ADDITION OF RS. 93, 600/ - . 16 . WITH REGARD TO ASSESSEES CLAIM FOR DEDUCTION U/S. 88 ON ACCOUNT OF INVESTMENT IN LIC AND NSCS, THE CIT(A) HAS DECLINED THE SAME ON THE PLEA THAT IN VIEW OF THE DECISION OF THE H O N BLE SUPREME COURT IN THE CASE OF GOETZ (INDIA) LTD. VS. CIT, 284 ITR 323 , NO CLAIM CAN BE ENTERTAINED. 16.1 WE HAVE CONSIDERED THE RIVAL CONTENTIONS. SINCE THE ADDITION HAS ALREADY BEEN MADE ON ACCOUNT OF PAYMENT MADE FOR LIC AND NSC, THERE IS NO REASON TO DECLINE REBATE U/S. 88 OF THE ACT IN RESPECT OF SUCH INVESTMENT. IN THE INTEREST OF JUSTICE AND FAIR - PLAY, WE RESTORE THIS ISSUE TO THE FILE OF AO FOR DECIDING AFRESH AS PER LAW. WE DIRECT ACCORDINGLY. 17 . IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED IN PART WHEREAS THE APPEAL OF REVENUE IS DISMISSED . ITA NO. 4638&4920 / 08 11 ORDER PRONOUN CED IN THE OPEN COURT ON THIS 17/10 / 201 4 . 17/10 / 2014 SD/ - SD/ - ( ) ( SANJAY GARG ) ( ) ( R.C.SHARMA ) / JUDICIAL MEMBER / ACCOUNTANT MEMBER MUMBAI ; DATED 17/10 /2014 /PKM , PS COPY OF THE ORDER FORWARDED TO : / BY ORDER, ( ASSTT. REGISTRAR) / ITAT, MUMBAI 1. / THE APPELLANT 2. / THE RESPONDENT. 3. / THE CIT(A) , MUMBAI. 4. / CIT 5. / DR, ITAT, MUMBAI 6. GUARD FILE. //TRUE COPY// ITA NO. 4638&4920 / 08 12 DATE INITIAL 1. DRAFT DICTATED ON 13 - 10 - 2014 SR.PS 2. DRAFT PLACED BEFORE AUTHOR 14 - 10 - 2014 (DICTATION PAD HA S BEEN ENCLOSED ALONG WITH THIS ORIGINAL FILE) SR.PS 3. DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER JM/AM 4. DRAFT DISCUSSED/APPROVED BY SECOND MEMBER. JM/AM 5. APPROVED DRAFT COMES TO THE SR.PS/PS SR.PS/ PS 6. KEPT FOR PRONOUNCEMENT ON S R.PS 7. FILE SENT TO THE BENCH CLERK SR.PS 8. DATE ON WHICH FILE GOES TO THE AR 9. DATE ON WHICH FILE GOES TO THE HEAD CLERK. 10. DATE OF DISPATCH OF ORDER.