Sri. R. Krishna, Mysore V. ACIT, Mysore

ITA 476/BANG/2014

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 0395 (ITAT-BANGALORE)
• Duration Of Justice: 2 year(s) 1 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-05-2016
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 24-03-2016
• Assessment Year: 2008-2009
• Appeal Filed On: 08-04-2014
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: G R REDDY
• Assessee Lawyers: S VENKATESAN
• Keywords: Unexplained cash credit; Gift; Search and seizure
• Section: 143(3); 153A; 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, BANGALORE BEFORE SHRI VIJAY PAL RAO, JUDICIAL MEMBER AND SHRI INTURI RAMA RAO, ACCOUNTANT MEMBER ITA NO S . 476 TO 4 7 8/ BANG/20 1 4 (ASSESSMENT YEAR: 20 08 - 09 TO 2010 - 11 ) SHRI R.KRISHNA, NO.648, E & F BL OCK, KUVEMPUNAGAR, MYSORE. PAN: ADXPN 1237 D VS. APPELLANT ASST. COMMISSIONER OF INCOME - TAX, CENTRAL CIRCLE, MYSORE. RESPONDENT APPELLANT BY : SHRI S.VENKATESAN, CA. RESPONDENT BY : SHRI G.R.REDDY, CIT(DR) DATE OF HEARI NG : 24/03/2016 DATE OF PRONOUNCEMENT : 13 /05/2016 O R D E R PER I NTURI RAMA RAO, AM : THESE ARE APPEALS FILED BY THE ASSESSEE DIRECTED AGAINST THE COMMON ORDER OF THE COMMISSIONER OF INCOME - TAX(APPEALS) - VI [CIT(A)], BANGALORE, FOR THE ASSESS MENT YEARS 2008 - 09 TO 2010 - 11. SINCE COMMON ISSUES ARE INVOLVED IN THESE APPEALS, WE PROCEED TO DISPOSE OF THE SAME BY THIS CONSOLIDATED ORDER FOR THE ITA NO S . 476 TO 478 /BANG/201 4 PAGE 2 OF 13 SAKE OF CONVENIENCE. FACTS RELATING TO ASSESSMENT YEAR 2010 - 11 ARE STATED HEREIN. 2. THE ASSESSEE RAISE D THE FOLLOWING GROUNDS OF APPEAL FOR THE ASSESSMENT YEAR 2010 - 11: 1. THE ORDER OF THE LEARNED CIT[A] IN SO FAR AS IT SUSTAINS ADDITIONS IMPUGNED IN THIS APPEAL AND ONLY ALLOWING THE APPEAL PARTLY INSTEAD OF TOTALLY IS OPPOSED TO LAW, EQUITY, WEIGHT OF EVIDE NCE, FACTS AND CIRCUMSTANCES OF THE APPELLANT'S CASE. 2. THE LEARNED CIT[A] HAS ERRED IN UPHOLDING THE ORDER OF ASSESSMENT U/S.143[3] RWS 153C OF THE ACT, WHICH IS BAD IN LAW AND VOID - AB - INITIO, SINCE THERE IS A SEARCH IN THE RESIDENTIAL PREMISES OF THE APPE LLANT AND IN THE PERSONAL CHAMBER OF THE APPELLANT IN M/S. VASU AGAR B ATHI PREMISES, OF WHICH THE APPELLANT IS A MANAGING PARTNER, WHICH CABIN IS IN HIS PERSONAL POSSESSION AND CONTROL AND CONSEQUENTLY, THE APPELLANT OUGHT TO HAVE BEEN ASSESSED U/S.143[3] R WS 1534. AND BY ISSUANCE OF NOTICE U/S.153A[1][A] OF THE ACT, AS MANDATORILY REQUIRED AND THAT IN THE ABSENCE OF A JURISDICTIONAL NOTICE, THE ASSESSMENT MADE BY INVOKING THE PROVISIONS OF SECTION 153C OF THE ACT, INSTEAD IS MISCONCEIVED AND THE CONSEQUENTI AL ASSESSMENT REQUIRES TO BE ANNULLED AND ACCORDINGLY THE LEARNED CIT[A] OUGHT TO HAVE ANNULLED THE ASSESSMENT. 3. THE LEARNED CIT[A] FAILED TO APPRECIATE THAT THE NOTICES ISSUED U/S.153C RWS 153A[1][A] OF THE ACT, IS PATENTLY ILLEGAL AND THE RETURNS FILED I N RESPONSE TO THAT NOTICE IS ALSO ILLEGAL AND CONSEQUENTLY, THE ASSESSMENTS MADE WITHOUT ISSUANCE OF THE NOTICE U/S.153A OF THE ACT, IS ALSO ILLEGAL AND LIABLE TO BE ANNULLED. ITA NO S . 476 TO 478 /BANG/201 4 PAGE 3 OF 13 4. THE SEIZURE OF THE CASH AND DOCUMENTS FOUND IN THE PERSONAL CHAMBER OF THE APP ELLANT, WHICH IS UNDER HIS EXCLUSIVE POSSESSION AND CONTROL WITHOUT A SEPARATE WARRANT INITIATING SEARCH IN HIS NAME IS ILLEGAL AND CONSEQUENTLY, THE ASSESSMENT REQUIRES TO BE CANCELLED. 5. THE LEARNED CIT[A] FAILED TO APPRECIATE THE APPELLANT HAVING FILED THE RETURN IN RESPONSE TO NOTICE U/S.153C OF THE ACT, AS AND WHEN THE CASE CAME TO BE POSTED IT WAS BEING PLEADED TIME AND AGAIN THAT THE NOTICE ISSUED WAS ILLEGAL AND THE NOTICE WHICH OUGHT TO HAVE BEEN ISSUED WAS NOT ISSUED AND SUCH PARTICIPATION WAS ONL Y TO EMPHASIS ABOUT THE ILLEGALITY OF ASSUMPTION OF JURISDICTION AND SUCH A PARTICIPATION SHOULD NOT BE CONSIDERED AS HAVING ACQUIESCED TO THE JURISDICTION OR CURING THE DEFECT OF SUCH ILLEGALITY IN THE ASSUMPTION OF JURISDICTION FOR MAKING SUCH ASSESSMENT . 6. WITHOUT PREJUDICE TO THE ABOVE, THE LEARNED CIT[A] IS NOT JUSTIFIED IN SUSTAINING THE ADDITION OF A SUM OF RS.57,78,203/ - BEING THE AMOUNTS TRANSFERRED TO THE APPELLANT'S ACCOUNT IN THE BOOKS OF M/S.VASU VIKRAM ARCADES UNDER THE FACTS AS SET - OUT IN DETA IL IN ANNEXURE - 1, AND IN THE CIRCUMSTANCES OF THE APPELLANT'S CASE BY CONSIDERING FACTORS WHICH ARE IRRELEVANT TO CONCLUDE WHETHER THE CREDIT IS GENUINE OR NOT AND THUS VITIATED AND THEREFORE, REQUIRES TO BE DELETED. 6.1 THE ADDITION IS PURELY ON SUSPICIO N AND SURMISE, ASSUMPTIONS AND PRESUMPTIONS AND LIABLE TO BE DELETED AND AS ONE MADE ON ERRONEOUS APPRECIATION OF FACTS AND ACCORDINGLY PRINCIPLES OF DOUBLE ENTRY AND BY CONSIDERING IRRELEVANT CIRCUMSTANCES, WHICH ARE NOT RELEVANT AND GENUINE TO CONSIDER W HETHER THE CREDIT IS GENUINE OR NOT. ITA NO S . 476 TO 478 /BANG/201 4 PAGE 4 OF 13 7. WITHOUT PREJUDICE TO THE RIGHT TO SEEK WAIVER WITH THE HON'BLE CCIT/DG, THE APPELLANT DENIES HIMSELF LIABLE TO BE CHARGED TO INTEREST U/S. 234 - A, 234 - B AND 234 - C OF THE ACT, WHICH UNDER THE FACTS AND IN THE CIRCUMSTAN CES OF THE APPELLANT'S CASE DESERVES TO BE CANCELLED. 8. FOR THE ABOVE AND OTHER GROUNDS THAT MAY BE URGED AT THE TIME OF HEARING OF THE APPEAL, YOUR APPELLANT HUMBLY PRAYS THAT THE APPEAL MAY BE ALLOWED AND JUSTICE RENDERED AND THE APPELLANT MAY BE AWARDED COSTS IN PROSECUTING THE APPEAL AND ALSO ORDER FOR THE REFUND OF THE INSTITUTION FEES AS PART OF THE COSTS. 3. BRIEFLY, FACTS OF THE CASE ARE THAT THE APPELLANT IS AN INDIVIDUAL. SEARCH AND SEIZURE OPERATIONS WERE CONDUCTED IN THE BUSINESS PRE MISES OF M/S.N.RANGA RAO & SONS, M/S.VASU AGARBATHIES AND GROUP OF CASES ON 18/06/2010. THE APPELLANT IS STATED TO BE A PARTNER IN THE FIRM M/S.VASU AGARBATHIES. CONSEQUENT TO THESE SEARCHES, OFFICE PREMISES AS WELL AS RESIDENTIAL PREMISES OF THE APPELLA NT WERE ALSO SEARCHED. IT WAS STATED BY THE ASSESSING OFFICER [AO] THAT CONSEQUENT UPON SEARCH OPERATIONS, DOCUMENTS AND ASSETS BELONGING TO APPELLANT WERE FOUND AND SEIZED AND CONSEQUENTLY NOTICE U/S 153C OF THE INCOME - TAX ACT, 1961 [HEREINAFTER REFERRED TO AS 'THE ACT' FOR SHORT] WAS ISSUED TO THE APPELLANT CALLING UPON HIM TO FILE RETURN OF INCOME. IN RESPONSE TO THE SAID NOTICE, APPELLANT FILED RETURN OF INCOME DISCLOSING INCOME AS FOLLOWS: ITA NO S . 476 TO 478 /BANG/201 4 PAGE 5 OF 13 ASST. YEAR RETURN OF INCOME (RS.) AGRICULTURAL INCOME (RS.) 2008 - 09 3,29,450 29,440 2009 - 10 19,70,170 32,580 2010 - 11 7,65,360 49,640 4. AGAINST THE SAID RETURN OF INCOME, ASSESSMENTS WERE COMPLETED BY THE ASST. COMMISSIONER OF INCOME - TAX, CENTRAL CIRCLE, MYSORE, U/S 143(3) R.W.S. 153C OF THE ACT VIDE ORDE RS DATED 31/12/2012 ON A TOTAL INCOME OF RS. 38,09,450/ - FOR ASSESSMENT YEAR 2008 - 09, RS.94,25,484/ - FOR ASSESSMENT YEAR 2009 - 10 AND RS.1,01,76,083/ - FOR ASSESSMENT YEAR 2010 - 11. ADDITION OF RS.29,80,000/ - ON ACCOUNT OF UNEXPLAINED DEPOSIT IN BANK A/C BEAR ING CLSB/01/040003 WITH CORPORATION BANK, BANNIMANTAP BRANCH, MYSORE AND RS.5 LAKHS AS UNEXPLAINED CASH CREDIT IN THE NAME OF M/S.VASU VIKRAM ARCADES WAS MADE FOR THE ASSESSMENT YEAR 2008 - 09. FOR ASSESSMENT YEAR 2009 - 10, ADDITION OF RS.21,60,000/ - WAS M ADE ON ACCOUNT OF UNEXPLAINED SOURCE FOR GIFT MADE TO SHRI ABHISHEK RANGA AND ADDITION OF RS.46,58,000/ - WAS MADE ON ACCOUNT OF UNEXPLAINED CASH DEPOSIT IN THE CORPORATION BANK, BANNIMANTAP BRANCH A/C NO.CLSB/01/040003, UNEXPLAINED CASH CREDIT OF RS.5 LAK HS AND ON ACCOUNT OF LONG TERM CAPITAL GAINS OF RS.1,37,314/ - . FOR THE ASSESSMENT YEAR 2010 - 11, ADDITION OF RS.17,30,000/ - WAS MADE ON ACCOUNT OF UNEXPLAINED CASH DEPOSIT IN THE CORPORATION BANK, BANNIMANTAP BRANCH A/C NO.CLSB/01/040003; ADDITION OF ITA NO S . 476 TO 478 /BANG/201 4 PAGE 6 OF 13 RS.6 2,78,203/ - WAS MADE AS UNEXPLAINED CREDIT IN THE NAME OF M/S.VASU VIKRAM ARCADES. 5. BEING AGGRIEVED BY THE ABOVE ADDITIONS, AN APPEAL WAS PREFERRED BEFORE THE CIT(A). IT WAS CONTENDED BEFORE THE CIT(A) THAT ASSUMPTION OF JURISDICTION BY THE AO UNDER THE PROVISIONS OF SEC.153C IS INVALID AS THE DOCUMENTS WERE ALLEGED TO BE BELONGING TO THE APPELLANT WERE SEIZED AS A RESULT OF SEARCH AND SEIZURE OPERATIONS CONDUCTED IN THE PREMISES OF THE APPELLANT S RESIDENCE AS WELL AS THE OFFICE PREMISES. THIS CONT ENTION OF THE APPELLANT WAS REJECTED BY THE CIT(A) HOLDING THAT THE APPELLANT HAD COMPLIED WITH THE NOTICES ISSUED BY THE AO AND PARTICIPATED IN THE ASSESSMENT PROCEEDINGS AND NO OBJECTION WAS RAISED AT ANY STAGE OF PROCEEDINGS BEFORE THE AO. ON MERITS OF THE ADDITION, THE CIT(A), AFTER CONSIDERING THE EXPLANATION FILED BY THE APPELLANT THAT THE ADDITION OF RS.29,80,000/ - WAS NOT WARRANTED AS THE CIT(A) FOUND THAT THE DEPOSITS IN CASH CAN BE RELATED T THE BALANCE OF CASH AVAILABLE AS PER THE CASH BOOK. THE CIT(A) CONFIRMED THE ADDITION OF RS.5 LAKHS MADE ON ACCOUNT OF UNEXPLAINED CREDIT APPEARING IN THE BOOKS OF ACCOUNT IN THE NAME OF M/S.VASU AGARBATHIES. AS REGARDS THE ADDITION OF RS.21,60,000/ - MADE IN THE ASSESSMENT YEAR 2009 - 10, THE CIT(A) ACCEPTED THE EXPLANATION OF THE APPELLANT THAT THE AMOUNT OF GIFT WAS MADE OUT OF BALANCE AVAILABLE AS PER CASH BOOK OF THE APPELLANT. HOWEVER, THE CIT(A) SUSTAINED THE ADDITION OF RS.46,58,000/ - MADE AS UNEXPLAINED CASH DEPOSIT IN THE BANK ITA NO S . 476 TO 478 /BANG/201 4 PAGE 7 OF 13 ACCOUNT OF THE APPELLA NT WITH CORPORATION BANK, BANNIMANTAP BRANCH BY HOLDING THAT THE EXPLANATION TENDERED BY THE APPELLANT THAT THE DEPOSITS ARE MADE OUT OF ADVANCES RECEIVED IS ONLY AN AFTER - THOUGHT. FOR THE ASSESSMENT YEAR 2010 - 11 ADDITION OF RS.17,30,000/ - MADE ON ACCOUNT OF CASH DEPOSIT WAS DELETED ACCEPTING THE EXPLANATION OF THE APPELLANT THAT DEPOSITS WERE MADE OUT OF DRAWINGS FROM M/S.SUKRUTHI INFOTECH, A PARTNERSHIP FIRM, IN WHICH THE APPELLANT IS A PARTNER. HOWEVER, THE CIT(A) SUSTAINED THE ADDITION OF RS.57,78,203 / - MADE ON ACCOUNT OF UNEXPLAINED LIABILITY APPEARING IN THE BOOKS OF THE APPELLANT HOLDING THAT THE APPELLANT HAD FAILED TO EXPLAIN THE GENUINENESS OF THE TRANSACTION APPEARING IN THE NAME OF M/S.VASU VIKRAM ARCADES. BEING AGGRIEVED WITH THAT PART OF THE ORDER OF THE CIT(A) WHICH IS AGAINST THE APPELLANT, APPELLANT IS BEFORE US WITH THE PRESENT APPEAL. 6. LEARNED AR OF THE APPELLANT VEHEMENTLY ARGUED THAT THE CIT(A) WAS NOT JUSTIFIED IN SUSTAINING THE ADDITION OF RS.57,78,203/ - AS UNEXPLAINED CREDIT IN THE BOOKS OF ACCOUNT AS IT WAS ONLY A JOURNAL ENTRY MADE AND THERE WAS NO CASH RECEIPT IN THE BOOKS OF THE FIRM. IT WAS SUBMITTED THAT THE FIRM M/S.VASU VIKRAM ARCADES RECEIVED A SUM OF RS.2 CRORES FROM ONE MR.NAGENDRA PRASAD. OUT OF THIS, A SUM OF RS .1,73,34,610/ - WAS TRANSFERRED TO THE ACCOUNT OF M/S.VASU VIKRAM ARCADES, PARTNERSHIP FIRM, IN WHICH THE APPELLANT IS A PARTNER. IT IS FURTHER STATED THAT M/S.VASU AGARBATHIES IS ALSO A PARTNER IN M/S.VASU ITA NO S . 476 TO 478 /BANG/201 4 PAGE 8 OF 13 VIKRAM ARCADES. M/S.VASU VIKRAM ARCADES WHO TRA NSFERRED A SUM OF RS.1,73,34,610/ - TO M/S.VASU AGAR B ATHIES, PASSED A JOURNAL ENTRY OF RS.57,78,203/ - CREDITING EACH OF ITS PARTNERS M/S.VASU AGARBATHIES AND IT WAS STATED THAT THE ENTRY OF RS.57,78,203/ - APPEARING IN THE NAME OF M/S.VASU VIKRAM ARCADES IS ONLY A JOURNAL ENTRY AND THERE WAS NO CASH FLOW TO THE APPELLANT DIRECTLY. THEREFORE, THE PROVISIONS OF SEC.68 WERE NOT APPLICABLE. AS REGARDS THE ADDITION OF RS.5 LAKHS AS UNEXPLAINED CREDIT, APPELLANT SUBMITS THAT IT REPRESENTS OPENING BALANCE FOR THE ASSESSMENT YEARS 2009 - 10 AND 2010 - 11. AS REGARDS THE ADDITION OF CASH CREDIT DEPOSITS OF RS.45,50,000/ - FOR ASSESSMENT YEAR 2009 - 10, IT WAS EXPLAINED THAT THE SAME WAS OUT OF ADVANCED RECEIVED WHICH ARE SHOWN IN THE BOOKS OF ACCOUNT REGULARLY MAINTAINED B Y THE APPELLANT. THEREFORE, NO ADDITION WAS CALLED FOR. THUS, LEARNED AR OF THE ASSESSEE SUBMITTED THAT IN LIGHT OF THE EXPLANATION FILED BY THE APPELLANT, NO ADDITIONS WERE CALLED FOR. ON THE OTHER HAND, LEARNED CIT - DR RELIED ON THE ORDERS OF THE LOWER AUTHORITIES. 7. WE HEARD RIVAL SUBMISSIONS AND PERUSED MATERIAL ON RECORD. AT THE FIRST INSTANCE, WE SHALL DEAL WITH THE GROUNDS CHALLENGING THE VALIDITY OF ASSUMPTION OF JURISDICTION U/S 153C OF THE ACT. THE CONTENTION OF THE APPELLANT IS THAT SINCE SEARCH AND SEIZURE OPERATIONS WERE ACTUALLY CONDUCTED IN THE RESIDENTIAL PREMISES AS WELL AS THE BUSINESS PREMISES OF THE APPELLANT, ITA NO S . 476 TO 478 /BANG/201 4 PAGE 9 OF 13 PROVISIONS SHOULD HAVE BEEN INITIATED ONLY U/S SEC.153A OF THE ACT AND NOT U/S 153C OF THE ACT. IT IS UNDISPUTED FA CT THAT THERE WAS NO SEARCH WARRANT IN THE NAME OF THE APPELLANT. IT IS ALTOGETHER A DIFFERENT ISSUE AS TO THE VALIDITY OF THE SEARCH CONDUCTED IN THE RESIDENTIAL PREMISES OF THE APPELLANT IN THE ABSENCE OF WARRANT, T HEREFORE, THE CONTENTION THAT THE PROC EEDINGS SHOULD BE INITIATED ONLY U/S 153A OF THE ACT IS NOT ACCEPTED. FURTHERMORE THE APPELLANT HAD NOT RAISED ANY OBJECTION AS TO THE VALIDITY OF THE ASSUMPTION OF JURISDICTION U/S 153C AT ANY STAGE OF PROCEEDINGS BEFORE THE AO. HE HAS PARTICIPATED IN T HE ASSESSMENT PROCEEDINGS, INITIATED PURSUANT TO NOTICE ISSUED U/S 153C OF THE ACT. THE HON BLE BOMBAY HIGH COURT, IN THE CASE OF AMAYA INFRASTRUCTURE PVT. LTD. VS. ITO IN WP NO.787 OF 2016 DATED 20/4/2016 HELD THAT WHERE ASSESSEE PARTICIPATED IN THE ASSE SSMENT PROCEEDINGS AND NO OBJECTION WAS RAISED AT ANY STAGE BEFORE THE AO, THE ASSESSMENTS CANNOT BE CHALLENGED IN THE SUBSEQUENT PROCEEDINGS. RESPECTFULLY FOLLOWING THE RATIO LAID DOWN BY THE HON BLE BOMBAY HIGH COURT IN THE CASE OF AMAYA INFRASTRUCTURE PVT. LTD. (SUPRA) , WE HOLD THAT ASSUMPTION OF JURISDICTION BY THE AO U/S 153C IS VALID IN LAW. 8. NOW, WE TURN TO THE MERITS OF THE ADDITION. THE ONLY ADDITION INVOLVED IN THE ASSESSMENT YEAR 2008 - 09 IS ADDITION OF RS.5 LAKHS MADE ON ACCOUNT OF UNEX PLAINED CREDIT IN THE NAME OF M/S.VASU VIKRAM ARCADES . THE AO MADE ADDITION ON THE GROUND THAT THE AMOUNT STATED TO HAVE BEEN RECEIVED FROM M/S.VASU ITA NO S . 476 TO 478 /BANG/201 4 PAGE 10 OF 13 VIKRAM ARCADES NEVER CARRIED ON ANY BUSINESS NOR OBTAINED PERMANENT ACCOUNT NUMBER. THE CIT(A) ALSO CONFI RMED THE ADDITION ADOPTING THE REASONING OF THE AO. THE RECEIPT OF MONEY BY ACCOUNT PAYEE CHEQUE IS NOT SINE QUA NON FOR ACCEPTANCE OF THE SAME. IT IS TRITE LAW THAT INITIAL ONUS LIES ON THE ASSESSEE TO PROVE THE IDENTITY, GENUINENESS AND CREDIT WORTHINES S OF THE LENDOR. THERE WAS NO INFORMATION FILED EITHER BEFORE THE AO OR THE CIT(A) OR BEFORE US ESTABLISHING THE ABOVE THREE INGREDIENTS IN THE TRANSACTION. IN THE CIRCUMSTANCES, WE UPHOLD THE ADDITION OF RS.5 LAKHS , AS THE APPELLANT HAD FAILED TO DISCHA RGE HIS INITIAL ONUS OF PROVING THE IDENTITY, GENUINENESS AND CREDIT WORTHINESS OF THE LENDER. IN THE RESULT, THE APPEAL FOR THE ASSESSMENT YEAR 2008 - 09 IS DISMISSED. 8.1 FOR THE ASSESSMENT YEAR 2009 - 10, ONLY ADDITION OF RS.46,58,000/ - WAS UNDER CHALLEN GE IN THIS APPEAL. ADDITION WAS MADE BY THE AO DISBELIEVING THE EXPLANATION OFFERED BY THE APPELLANT THAT DEPOSITS WERE MADE IN THE BANK ACCOUNT OF THE APPELLANT IN THE CORPORATION BANK, BANNIMANTAP BRANCH, MYSORE, OUT OF CASH BALANCE AVAILABLE AS PER CASH BOOK. THIS CASH WAS STATED TO HAVE BEEN RECEIVED AS ADVANCE FROM VARIOUS PARTIES. THE AO DIRECTED THE APPELLANT TO FILE CONFIRMATION LETTERS FROM PARTIES WHO HAVE STA T ED TO HAVE GIVEN ADVANCE TO THE APPELLANT. THE APPELLANT HAD FAILED TO DISCHARGE TH IS ONUS BEFORE THE AO. THE APPELLANT NEITHER FILED BEFORE THE CIT(A) NOR BEFORE US SUBSTANTIATING THE CLAIM THAT THE AMOUNTS WERE RECEIVED FROM ITA NO S . 476 TO 478 /BANG/201 4 PAGE 11 OF 13 VARIOUS PARTIES AS ADVANCE. NO CONFIRMATION LETTERS WERE FILED. MERE FACT THAT CASH WAS AVAILABLE AS APPEARING IN WEALTH - TAX RETURN, CANNOT ALONE ESTABLISH AVAILABILITY OF CASH. THE FINDING IN WEALTH - TAX IS NOT RELEVANT FOR INCOME - TAX PROCEEDINGS. MORE OVER MERE FACT THAT CASH WAS AVAILABLE ON ONE PARTICULAR DATE I.E. ON THE VALUATION DATE FOR WEALTH - TAX PURPOSE, IT CANNOT BE PRESUMED THAT CASH WAS AVAILABLE THROUGH - OUT THE PERIOD OF PREVIOUS YEAR. 8.2 THE APPELLANT HAD FAILED TO CONTROVERT THE FINDING OF THE CIT(A) THAT WEALTH - TAX RETURNS WERE FILED DISCLOSING AVAILABILITY OF CASH ONLY TO COVER UP DEFICIT IN CASH BALANCE SUBSEQUENT TO SEARCH AND SEIZURE PROCEEDINGS AND I N VIEW OF THE FACT THAT THE APPELLANT HAS FAILED TO FURNISH CONFIRMATION LETTERS FROM WHOM ADVANCES HAVE BEEN RECEIVED, WE ARE UNABLE TO ACCEPT THE EXPLANATION OF THE APPELLANT IN SUPPORT OF THE AV AILABILITY OF CASH BALANCE. WE, ACCORDINGLY, DISMISS THIS GROUND OF APPEAL RAISED FOR ASSESSMENT YEAR 2009 - 10. 8.3 AS REGARDS THE OTHER GROUND RELATING TO ADDITION OF RS.1,37,314/ - WHILE COMPUTING CAPITAL GAINS IS NOT PRESSED DURING THE COURSE OF HEARI NG , H ENCE, DISMISSED AS SUCH. THE APPEAL OF THE APPELLANT FOR THE ASSESSMENT YEAR 2009 - 10 IS DISMISSED. 9. FOR THE ASSESSMENT YEAR 2010 - 11 THE ONLY GROUND RELATES TO ADDITION OF RS.57,78,203/ - . ADDITION WAS MADE BY THE AO SOLELY ON THE GROUND THAT THE APPELLANT HAD FAILED TO SUBSTANTIATE THE TRANSACTION BY PROVIDING THE IDENTITY, GENUINENESS AND CREDIT ITA NO S . 476 TO 478 /BANG/201 4 PAGE 12 OF 13 WORTHINESS OF THE FIRM IN WHOSE NAME THE AMOUNT WAS CREDITED. THE CIT(A) ALSO CONFIRMED THE ADDITION. THE ONLY EXPLANATION OFFERED BY THE APPELLANT IS THAT IT REPRESENTS A MERE BOOK ENTRY AND DOES NOT INVOLVED FLOW OF CASH. THEREFORE, QUESTION OF ADDITION U/S 68 DOES NOT ARISE. WE ARE UNABLE TO ACCEPT THE SUBMISSION OF THE APPELLANT IN THIS CONNECTION ON ACCOUNT OF FAILURE OF THE APPELLANT TO SUBST ANTIATE THE ENTRY BY PROVING THE IDENTITY, GENUINENESS AND CREDIT WORTHINESS OF THE TRANSACTION. IT IS TRITE LAW THAT EVEN IN RESPECT OF CREDIT ENTRY PROVISIONS OF SEC.68 ARE APPLICABLE. IN THIS CONNECTION, IT IS APT TO QUOTE THE DECISION OF THE HON BLE M ADHYA PRADESH HIGH COURT IN THE CASE OF V.I.S.P.(P) LTD. VS. CIT (2004) 136 TAXMAN 482(MP) WHEREIN IT WAS HELD THAT: 4. WE ARE AFRAID, SUCH A NARROW AND RESTRICTED INTERPRETATION OF THE PROVISIONS, CONTAINED IN SECTION 68 WAS ADVANCED BY LEARNED COUNSEL FOR THE APPELLANT/ASSESSEE, CANNOT BE ACCEPTED. IF THE LIABILITY SHOWN IN THE SAID ACCOUNT, WHICH, IS FOUND TO BE BOGUS AND IN THE ABSENCE OF ANY PLAUSIBLE AND REASONABLE EXPLANATION OFFERED BY THE ASSESSEE, THEN, CERTAINLY, THE AMOUNT CAN BE ADDED TOWARDS THE INCOME OF ASSESSEE AND BROUGHT TO TAX IN THE HANDS OF THE ASSESSEE. 5. THE RELIANCE PLACED ON THE DECISIONS, IN OUR CONSIDERED OPINION, DO NOT APPLY TO THE FACTS AND CIRCUMSTANCES OF THE CASE AND ARE DISTINGUISHABLE. FURTHERMORE , THIS ADDITION CA N BE SUSTAINED IF NOT UNDER THE PROVISIONS OF SEC.68 OF THE ACT BUT UNDER CLAUSE (IV) OF SUB - SEC(1) OF SEC.28 OF THE ACT. IN THE CIRCUMSTANCES, THE APPEAL FILED BY THE APPELLANT FOR THE ASSESSMENT YEAR 2010 - 11 IS DISMISSED. ITA NO S . 476 TO 478 /BANG/201 4 PAGE 13 OF 13 1 0. IN THE RESULT, ALL THE APPEALS FILED BY THE ASSESSEE ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 13 TH MAY , 2016 S D/ - S D/ - (VIJAY PAL RAO) (INTURI RAMA RAO) JUDICIAL MEMBER ACCOUNTANT MEMBER PLACE : BANGALORE D A T E D : 13 /0 5 /2016 SRIN IVASULU, SPS COPY TO : 1 APPELLANT 2 RESPONDENT 3 CIT(A) - II BANGALORE 4 CIT 5 DR, ITAT, BANGALORE. 6 GUARD FILE BY ORDER ASSISTANT REGISTRAR INCOME - TAX APPELLATE TRIBUNAL BANGALORE