Shri Anjanevalu Jayapal, Chennai V. ITO, Non Corporate Ward-10(2), Chennai

ITA 48/CHNY/2018

• Counselvise Citation: [2019] 112 COUNSELVISE.COM (IT) 5922 (ITAT-CHENNAI)
• Duration Of Justice: 1 year(s) 10 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-11-2019
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2013-2014
• Appeal Filed On: 03-01-2018
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Assessee Lawyers: M MURUGABOOPATHY ADV
• Keywords: Business income
• Section: 143(3)

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH : CHENNAI . . . , , [BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI INTURI RAMA RAO, ACCOUNTANT MEMBER ] ./I.T.A. NOS.48 & 49/CHNY/2018 ! / ASSESSMENT YEARS : 2013-14 & 2014-2015. ANJANEYALU JAYAPAL, OLD NO.2/56, NEW NO.3/51, TK PATTU, GANDHI STREET, REDHILLS, CHENNAI 600 052. VS. THE INCOME TAX OFFICER, NON CORPORATE WARD 10(2) CHENNAI. [PAN AHFPJ 3481Q] ( / APPELLANT) ( /RESPONDENT) '# $ % / APPELLANT BY : SHRI. M. MURUGABOOPATHY, ADV &' '# $ % /RESPONDENT BY : SHRI. AR.V. SREENIVASAN, JCIT. ( ) $ * /DATE OF HEARING : 24-10-2019 +,! $ * /DATE OF PRONOUNCEMENT : 21-11-2019 / O R D E R PER INTURI RAMA RAO, ACCOUNTANT MEMBER THESE ARE APPEALS FILED BY THE ASSESSEE DIRECTED AGAINST DIFFERENT ORDERS OF THE COMMISSIONER OF INCOME TAX (APPEALS)-12, ITA NOS.48 & 49/2018 :- 2 -: CHENNAI (CIT(A) FOR SHORT) DATED 24.10.2017 FO R THE ASSESSMENT YEARS (AY) 2013-14 AND 2014-15. 2. SINCE, THE IDENTICAL FACTS AND ISSUES ARE INVOLVED IN THESE APPEALS, WE PROCEED TO DISPOSE THE SAME VIDE THIS C OMMON ORDER. 3. FOR THE SAKE OF CONVENIENCE AND CLARITY THE FACTS R ELEVANT TO THE APPEAL IN ITA NO.48/CHNY/2018 FOR ASSESSMENT YEAR 2 013-14 ARE STATED HEREIN. 4. THE ASSESSEE RAISED THE FOLLOWING GROUNDS OF APPEAL : 1. THE LEARNED CIT (APPEALS) PASSED ORDER CONFIRM ING THE ADDITION OF RS.1,26,39,539 MADE BY AO AS UNEXPLAINE D CASH CREDIT WHICH IS PNTRARY TO LAW AND FACTS. 2. THE CIT (APPEALS) FAILED TO TAKE COGNISANCE OF T HE ERROR THAT AO HAD NOT FOUND ANY SUM CREDITED IN THE BOOKS OF A SSESSEE WHICH IS A PRECONDITION TO TREAT A RECEIPT AS UNEXP LAINED CASH CREDIT. 3. THE CIT (APPEALS) ERRED IN CONSIDERING RECEIPT E NTRIES IN BANK STATEMENT AND FINANCIAL STATEMENTS WHICH ARE N OT BOOKS AS ENVISAGED BY LAW AND AS SETTLED BY JUDICIAL PRON OUNCEMENTS. 4. THE LEARNED CIT (APPEALS) FAILED TO CONSIDER LET TER, SUBMITTED DURING APPELLATE PROCEEDINGS, ISSUED BY B ANK CONFIRMING THE BANK ACCOUNT AS JOINT ACCOUNT IN THE NAMES OF (1) ANJANEYALU JAYAPAL, THE APPELLANT,(2) J.SHENBAG AVALLI, WIFE OF APPELLANT AND (3) J.SRIRAM, SON OF APPELLANT. 5. THE LEARNED CIT (APPEALS) FAILED TO CONSIDER THE FACT THAT THE APPELLANT PROVED BEFORE LEARNED AO, THE IDENTIT Y OF THE CREDITOR FOR CASH DEPOSITS IN THE JOINT BANK ACCOUNT STATEMENT BY PRODUCING THE DEPOSITOR, J.SRI RAM, HIS SON, ONE OF THE JOINT ACCOUNT HOLDERS, BEFORE LEARN ED AD ON 21.3.2016. ITA NOS.48 & 49/2018 :- 3 -: 6. THE LEARNED CIT (APPEALS) FAILED TO CONSIDER THE FACT THAT J.SRIRAM, THE JOINT ACCOUNT HOLDER, ALSO ACCEPTED T HAT THE CASH DEPOSITS WERE MADE ONLY BY HIM IN THE JOINT BANK ACCOUNT WHICH WERE CASH SALE PROCEED S AND ADVANCES FROM CUSTOMERS RELATING TO HIS JEWELLERY S HOP M/S. SRI LAKSHMI THANGAMALIGAI. 7. THE LEARNED CIT (APPEALS) FAILED TO OBJECT TO TH E ASSESSMENT ORDER AS TO HOW THE LEARNED AO COULD TAK E AN IRRATIONAL VIEW THAT THE CASH DEPOSITS IN THE BANK ACCOUNT BELONGED TO FATHER AND NOT TO SON AND WHY COULDNT IT BE THE OTHER WAY ROUND WHERE THE ACCOUNT WAS A JOINT ACCOU NT AND ALL THE JOINT ACCOUNT HOLDERS UNANIMOUSLY STATED THAT T HE DEPOSITS BELONGED TO SONS BUSINESS AND NOT OF ANY OTHER JOI NT ACCOUNT HOLDER. 8. WHERE THE CIT (APPEALS) HAS OBSERVED THAT THE CA SH DEPOSIT IS SEVERAL TIMES HIGHER THAN BUSINESS TURNOVER AS P ER RETURN OF APPELLANT, HE HAS FAILED TO NOTE THAT THE CASH DEPO SIT IS SEVERAL TIMES LOWER THAN BUSINESS TURNOVER AS PER RETURN OF APPELLANTS SON, JAYAPAL SRIRAM WHO IS A JOINT ACCOUNT HOLDER. 9. THE APPELLANT CRAVES PERMISSION TO ADD, AMEND, A LTER OR VARY ALLOW ANY GROUNDS OF APPEAL BEFORE THE DISPOSAL OF APPEAL. 10. IN VIEW OF ABOVE GROUNDS AND ANY OTHER GROUND T HAT WILL BE PERMITTED TO BE ADDUCED AT THE TIME OF HEARING, THE APPELLANT PRAYS THE HONOURABLE TRIBUNAL TO ALLOW THE APPEAL A ND DELETE THE TAX DEMANDED. 5. THE BRIEF FACTS OF THE CASE ARE AS UNDER: THE APPELLANT IS AN INDIVIDUAL, CARRYING ON THE BUS INESS OF RUNNING BUS SERVICES IN THE NAME OF M/S. JAYALAKSH MI BUS SERVICE. THE RETURN OF INCOME FOR THE ASSESSMENT YEAR 2013 -14 WAS FILED ON 01.11.2014 DISCLOSING TOTAL INCOME OF RS.4,56,88 0/-. AGAINST THE SAID RETURN OF INCOME, THE ASSESSMENT WAS COMPLETED BY T HE INCOME TAX OFFICER, NON CORPORATE WARD 10(2), CHENNAI (IN S HORT THE ASSESSING ITA NOS.48 & 49/2018 :- 4 -: OFFICER ) VIDE ORDER DATED 31.03.2016 PASSED U/S . 143(3) OF THE INCOME TAX ACT, 1961 (FOR SHORT THE ACT) AT TOTA L INCOME OF RS. 1,30,96,419/-. WHILE DOING SO, THE ASSESSING OFFI CER MADE ADDITION OF RS.1,26,39,539/- AS UNEXPLAINED CASH DEPOSITS IN T HE SAVING BANK ACCOUNT MAINTAINED WITH M/S. KARNATAKA BANK. WHEN T HE ASSESSEE WAS ASKED TO EXPLAIN THE SOURCE FOR CASH DEPOSITS, IT WAS EXPLAINED BEFORE THE ASSESSING OFFICER THAT THE SAID ACCOUNT WAS JO INTLY HELD ALONGWITH HIS WIFE SMT.J.SHENBAGAVALLI AND HIS SON J. SRIRAM AND THE SOURCE FOR CASH DEPOSITS WAS EXPLAINED TO BE BUSINESS RECEIPTS OF HIS SON. BUT THE ASSESSING OFFICER RECORDED FINDING THAT ASSES SEE HAD FAILED TO SUBSTANTIATE THE EXPLANATION AND ASSESSEE ALSO FA ILED TO PROVE CREDIT WORTHINESS AND GENUINENESS OF UNSECURED LOAN OF RS .14,50,000/-. IN THE CIRCUMSTANCES, THE ASSESSING OFFICER MADE ADDIT ION IN RESPECT OF UNEXPLAINED CASH DEPOSITS OF RS.1,11,89,539/- AND UNSECURED CREDIT OF RS.14,50,000/-. 6. BEING AGGRIEVED, AN APPEAL WAS PREFERRED BEFORE THE LD.CIT(A) WHO VIDE IMPUGNED ORDER CONFIRMED THE ACT ION OF THE ASSESSING OFFICER BY HOLDING THAT THAT CASH DEPOSI TS IN THE SAVING BANK ACCOUNT ARE MORETHAN THE BUSINESS RECEIPT SHO WN IN THE NAME OF HIS SON. HE FURTHER OBSERVED THAT THE BANK ACCOUN T WAS HELD ONLY IN THE NAME OF THE ASSESSEE AND NOT HELD AS JOINT ACC OUNT. BASED ON THE ITA NOS.48 & 49/2018 :- 5 -: INFORMATION OBTAINED BY THE ASSESSING OFFICER AND EVEN IN RESPECT OF UNSECURED LOANS, ASSESSEE WAS UNABLE TO DISCHARGE T HE ONUS OF PROVING CREDITWORTHINESS, GENUINENESS AND SOURCE O F THE SUNDRY CREDITORS. ACCORDINGLY, HE CONFIRMED THE ACTION OF THE ASSESSING OFFICER. 7. BEING AGGRIEVED, THE APPELLANT IS IN APPEAL BEFORE US IN THE PRESENT APPEAL. THE LD. AUTHORISED REPRESENTATIVE A DVANCED THE SAME ARGUMENTS AS ADVANCED BEFORE THE LOWER AUTHORITIES AND HE FURTHER SUBMITTED THAT BOOKS OF ACCOUNTS MAINTAINED IN THE CASE OF HIS SON WERE DESTROYED IN FLOODS IN THE MONTH OF DECEMBER, 2015. 8. PER CONTRA, LD. DEPARTMENTAL REPRESENTATIVE SUBMITT ED THAT ASSESSEE COULD NOT DISCHARGE THE ONUS LYING ON HIM. 9. WE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATE RIAL ON RECORD. AS REGARDS TO THE ADDITION ON ACCOUNT OF UNEXPLAINED CASH DEPOSITS IN THE SAVING BANK ACCOUNT. ADMITTEDLY, A SSESSEE WAS UNABLE TO PROVE THE NEXUS BETWEEN CASH DEPOSITS MADE AND B USINESS RECEIPT OF HIS SON EXCEPT ORAL ASSERTION MADE BY THE ASSES SEE. NO EVIDENCE WAS FILED BEFORE LOWER AUTHORITIES. THE EXPLANATIO N THAT BOOKS OF ACCOUNTS WERE DESTROYED IN THE FLOODS CAUSED IN T HE MONTH OF ITA NOS.48 & 49/2018 :- 6 -: DECEMBER, 2015 HAD NO RELEVANCE AS THE SCRUTINY PR OCEEDINGS WERE STARTED IN THE MONTH OF AUGUST, 2015 AND SEPTEMBER 2015 AND ASSESSEE WAS ASKED TO PRODUCE THE SOURCE FOR CASH D EPOSITS. THEREFORE THE EXPLANATION OFFERED BY THE ASSESSEE H AS NO RELEVANCE ON THE ISSUE ON HAND. FURTHER, THE FINDINGS OF THE LD . COMMISSIONER OF INCOME TAX (APPEALS) THAT CASH DEPOSITS IN THE SA VING BANK ACCOUNT ARE MORETHAN THE BUSINESS RECEIPT SHOWN IN THE NAM E OF HIS SON REMAINS UNCONTROVERTED. SIMILARLY FINDINGS OF THE LOWER AUTHORITIES THAT SAVING BANK ACCOUNT WAS NOT HELD JOINTLY WIT H HIS WIFE MRS. J. SHENBAGAVALLI AND HIS SON J. SRIRAM ALSO REMAIN UNC ONTROVERTED. THIS WOULD CERTAINLY CLINCH THE ISSUE AGAINST THE ASSE SSEE AND ACCORDINGLY, WE ARE OF THE OPINION THAT THE ASSESSING OFFICER I S JUSTIFIED IN MAKING ADDITION OF RS.1,11,89,539/- AS UNEXPLAINED CASH DE POSITS. SIMILARLY, AS REGARDS TO THE ADDITION ON ACCOUNT OF SUNDRY CRE DITORS. ADMITTEDLY, ASSESSEE HAD FAILED TO DISCHARGE THE ONUS OF PROVIN G OF GENUINENESS, CREDITWORTHINESS AND IDENTITY OF SUNDRY CREDITORS. NO ATTEMPT WAS MADE BY THE ASSESSEE TO DISCHARGE THE ONUS. HENCE , WE CONFIRM THE ADDITION OF UNSECURED LOANS OF RS.14,50,000/-. WE D O NOT FIND ANY REASON TO INTERFERE WITH THE ORDERS OF THE LOWER AU THORITIES. 10. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IN ITA NO.48/CHNY/2018 FOR ASSESSMENT YEAR 2013-2014 STAND S DISMISSED. ITA NOS.48 & 49/2018 :- 7 -: ITA NO.49/CHNY/2018, FOR ASSESSMENT YEARS 2014-15. 11. SINCE, THE FACTS IN THE PRESENT APPEAL IS IDENTIC AL TO THE FACTS IN ITA NO.48/CHNY/2018, FOR ASSESSMENT YEAR 2013-2014, FOR THE REASONS MENTIONED THEREIN, WE DISMISS THE APPEAL ON THE ABOVE LINES INDICATED IN APPEAL ITA NO.48/CHNY/2018 SUPRA. HENC E, THE ABOVE CAPTIONED APPEAL FILED BY THE ASSESSEE STANDS DISM ISSED. 12. TO SUMMARIZE THE RESULTS, THE APPEALS FILED BY THE ASSESSEE IN ITA NOS. 48 AND 49/CHNY2018 FOR ASSESSMENT YEARS 2013-14 AND 2014-15 STAND DISMISSED. ORDER PRONOUNCED ON 21ST DAY OF NOVEMBER, 2019, AT CHENNAI. SD/- SD/- ( . . . ) (N.R.S. GANESAN) /JUDICIAL MEMBER ( ) (INTURI RAMA RAO) /ACCOUNTANT MEMBER - ) / CHENNAI . / DATED: 21ST NOVEMBER, 2019 KV $ &*01 21!* / COPY TO: 1 . '# / APPELLANT 3. ( 3* () / CIT(A) 5. 16 &*7 / DR 2. &' '# / RESPONDENT 4. ( 3* / CIT 6. 8 9) / GF