Gursev Singh Manchanda, New Delhi V. ITO, New Delhi

ITA 4842/DEL/2010

• Counselvise Citation: [2011] 140 COUNSELVISE.COM (IT) 53422 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 1 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-12-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 13-12-2011
• Assessment Year: 2005-2006
• Appeal Filed On: 04-11-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SALIL MISHRA
• Keywords: Unexplained expenditure; Gift; Additional evidence
• Section: 68

Judgement Text

ITA NO.4842/DEL/2010 & ITA 5039/D/2010 1 IN THE INCOME TAX APPELLAT E TRIBUNAL DELHI BENCH C NEW DELHI BEFORE SHRI G.D. AGRAWAL, VICE PRESIDENT AND SHRI C.L. SETHI, JUDICIAL MEMBER ITA NO.4842/DEL/2010 ASSTT. YEAR: 2005-06 SHRI GURSEV SINGH MANCHANDA, VS INCOME TAX OFFI CER, 9/77, PUNJABI BAGH WEST, WARD 12 (2), NEW DELHI. NEW DELHI. (PAN NO. AGDPM4784A) ITA NO. 5039/DEL/2010 ASSTT. YEAR: 2005-06 INCOME TAX OFFICER, VS SHRI GURSEV SING H MANCHANDA, WARD 12(2), PUNJAB I BAGH WEST, NEW DELHI. NEW DELHI. (APPELLANT) (RESPONDENT) APPELLANT BY: SHRI VINOD GUPTA RESPONDENT BY: SHRI SALIL MISHRA, SR. DR O R D E R PER G.D. AGRAWAL, V.P. THESE CROSS APPEALS HAVE BEEN PREFERRED BY THE AS SESSEE AS WELL AS THE REVENUE AGAINST THE ORDER OF CIT(A) DATED 31.8.2010 . IN THE ASSESSEES APPEAL, THE FOLLOWING GROUNDS ARE RAISED:- THE LD. CIT(A) ERRED ON FACTS AND UNDER THE LAW IN SUSTAINING THE ACTION OF AO PARTLY BY UPHOLDING THE ADDITION TO INCOME TO THE EXTENT OF RS.8,83,900/- CASH DEPOSITE D IN BANK OUT OF TOTAL CASH DEPOSITED ON VARIOUS DATES AMOUNTING TO RS.14,75,800/-. VARIOUS OBSERVATIONS MADE BY THE LEARNED CIT(A) WHI LE SUSTAINING ITA NO.4842/DEL/2010 & ITA 5039/D/2010 2 THE ABOVE ADDITION ARE ARBITRARY, UNJUST AND ARE NO T LEGALLY TENABLE. THE FACTS, CIRCUMSTANCES AND LEGAL POSITIO N AS SUBMITTED WERE NOT PROPERLY APPRECIATED. WITHOUT PREJUDICE THE DISALLOWANCE AS MADE ARE EXCE SSIVE. 2. THE LD. CIT(A) ERRED ON FACTS AND UNDER THE LAW IN SUSTAINING THE ACTION OF AO IN MAKING ADDITION/DISALLOWANCE O F RS.5,00,000/- ON ACCOUNT OF GIFT GIVEN BY THE ASSESSEE TO HIS FAT HER. VARIOUS OBSERVATIONS MADE BY THE LD. CIT(A) WHILE SUSTAININ G THE ABOVE DISALLOWANCE ARE ARBITRARY, UNJUST AND ARE NOT LEGA LLY TENABLE. THE FACTS, CIRCUMSTANCES AND LEGAL POSITION AS SUBMITTE D WERE NOT PROPERLY APPRECIATED. WITHOUT PREJUDICE THE DISALLOWANCE AS MADE ARE EXCE SSIVE. 3. THE LD. CIT(A) ERRED IN SUSTAINING THE ACTION OF AO IN MAKING ADDITION/DISALLOWANCE OF RS.7,03,477/- ON ACCOUNT O F GIFT RECEIVED BY THE ASSESSEE FROM HIS BROTHER. THE FACTS, CIRCU MSTANCES AND LEGAL POSITION AS SUBMITTED WERE NOT PROPERLY APPRECIATED . 4. THE LD. CIT(A) ERRED ON FACTS AND UNDER THE L AW IN SUSTAINING THE ACTION OF AO IN MAKING ADDITION/DISALLOWANCE OF RS.71,000/- BEING SPENT BY THE FATHER OF THE ASSESSEE ON ASSESS EES VISIT TO MEET HIM ABROAD AS UNEXPLAINED EXPENDITURE. THE FACTS, CIRCUMSTANCES AND LEGAL POSITION AS SUBMITTED WERE NOT PROPERLY A PPRECIATED. 2. IN THE REVENUES APPEAL, FOLLOWING GROUNDS HAVE BEEN RAISED:- 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, TH E CIT(A) HAS ERRED IN DELETING THE ADDITION OF RS.5,91,100/- ON ACCOUNT OF UNDISCLOSED SOURCES U/S 68 OF THE I.T. ACT DEPOSITE D IN CASH ON VARIOUS DATES WITH BANK BY THE ASSESSEE DURING THE YEAR. 2. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, TH E CIT(A) ERRED IN DELETING THE ADDITION OF RS.16,12,000/- MADE U/S 68 OF I.T.ACT BEING INVESTMENT MADE OUT OF UNDISCLOSED SOURCE. ITA NO.4842/DEL/2010 & ITA 5039/D/2010 3 3. ON THE FACTS AND CIRCUMSTANCES OF THE CASE THE CIT( A) HAS ERRED IN DELETING THE ADDITION OF RS.91,692/- MADE U/S 68 OF I.T.ACT. 3. AT THE TIME OF HEARING BEFORE US, THE ASSESSEE S OUGHT FOR ADMISSION OF ADDITIONAL EVIDENCE WHICH IS CASH FLOW STATEMENT FO R THE FINANCIAL YEAR 2003- 04 AND 2004-05. HE STATED THAT DURING THE YEAR UND ER CONSIDERATION, THE AO HAS MADE THE ADDITION OF RS.14,75,800, BEING CASH D EPOSITED ON DIFFERENT DATES IN STANDARD CHARTERED BANK. ON APPEAL, THE C IT(A) DELETED THE ADDITION TO THE TUNE OF RS.5,91,000 AND SUSTAINED T HE ADDITION AT RS.8,83,900. THE ASSESSEE IS IN APPEAL IN RESPECT OF ADDITION SU STAINED VIDE GROUND NO.1 OF THE ASSESSEES APPEAL WHILE THE REVENUE IS IN APPEA L IN RESPECT OF RELIEF ALLOWED BY THE CIT(A) VIDE GROUND NO.1 OF THE REVEN UES APPEAL. HE SUBMITTED THAT FROM THIS CASH FLOW STATEMENT, IT IS EVIDENT THAT ASSESSEE HAD SUFFICIENT CASH BALANCE ON EACH AND EVERY DATE ON W HICH THE CASH WAS DEPOSITED WITH THE BANK. LD. DR HAD NO OBJECTION T O THE ADMISSION OF ADDITIONAL EVIDENCE. HE SUBMITTED THAT THE ADDITIO NAL EVIDENCE IS A FACTUAL STATEMENT OF INCOMING AND OUTGOING OF THE CASH DURI NG THESE TWO YEARS. THEREFORE, IT IS REQUIRED TO BE VERIFIED AT THE END OF THE AO. 4. THE LD. COUNSEL FOR THE ASSESSEE HAD NO OBJECTIO N TO THIS SUGGESTION OF THE LD. DR THAT THE MATTER IS REQUIRED TO BE SENT B ACK FOR VERIFICATION OF THE ADDITIONAL EVIDENCE. ITA NO.4842/DEL/2010 & ITA 5039/D/2010 4 5. LD. DR FURTHER POINTED OUT THAT IN RESPECT OF AN OTHER RELIEF ALLOWED BY THE CIT(A) I.E. WITH REGARD TO INVESTMENT OF RS.16, 12,000 ALSO, THE ASSESSEE HAD PRODUCED CERTAIN ADDITIONAL EVIDENCE BEFORE THE CIT(A) WHICH IS ADMITTED AND RELIED UPON BY THE CIT(A) WITHOUT FOLL OWING THE PROCEDURE LAID DOWN BY RULE 46A OF THE I.T. ACT. 6. LD. COUNSEL FOR THE ASSESSEE AT THE OUTSET OBJEC TED TO THIS SUBMISSION OF THE LD. DR AND STATED THAT ALL THE EVIDENCES WHI CH WERE PRODUCED BEFORE THE CIT(A) WERE DULY PRODUCED BEFORE THE AO AND IT IS THE AO WHO DID NOT CONSIDER THE SAME. HE, HOWEVER, STATED THAT EVEN I F ALL THE EVIDENCES WERE PRODUCED BEFORE THE AO, HE HAD NO OBJECTION IF THIS MATTER IS ALSO SET ASIDE TO THE FILE OF THE AO FOR READJUDICATION AFTER CONS IDERING ALL THE EVIDENCE. HE ALSO SUBMITTED THAT IN RESPECT TO OTHER GROUNDS IN THE ASSESSEES APPEAL ALSO, THE FACTS AND EVIDENCES PRODUCED BEFORE THE A O WERE NOT CONSIDERED BY HIM AND, THEREFORE, THE ENTIRE GROUNDS RAISED EITHE R IN THE ASSESSEES APPEAL OR IN REVENUES APPEAL, MAY BE SET ASIDE TO THE FIL E OF THE AO FOR READJUDICATION, AFTER CONSIDERING ALL THE EVIDENCES WHICH ARE ON RECORD AND ALSO THE ADDITIONAL EVIDENCE WHICH THE ASSESSEE WIL L FURNISH BEFORE THE AO. LD. DR HAS NO OBJECTION TO THIS SUGGESTION OF THE L EARNED COUNSEL. 7. SINCE BOTH THE PARTIES HAVE AGREED THAT ALL THE ISSUES RAISED IN BOTH THE APPEALS BY THE DEPARTMENT AS WELL AS THE ASSESSEE A RE REQUIRED TO BE SET ASIDE ITA NO.4842/DEL/2010 & ITA 5039/D/2010 5 TO THE FILE OF THE AO, WE, THEREFORE, SET ASIDE ALL THE ISSUES RAISED EITHER IN ASSESSEES APPEAL OR IN REVENUES APPEAL BACK TO TH E FILE OF THE AO. WE DIRECT THE ASSESSEE TO PRODUCE ALL THE EVIDENCE/EXP LANATION IN SUPPORT OF HIS CONTENTIONS BEFORE THE AO. THEREAFTER, THE AO IS D IRECTED TO READJUDICATE ALL THE ISSUES IN ACCORDANCE WITH LAW. NEEDLESS TO MEN TION, THE AO WILL ALLOW ADEQUATE OPPORTUNITY TO THE ASSESSEE TO PRODUCE ALL THE EVIDENCE/EXPLANATION BEFORE HIM. 8. IN THE RESULT, BOTH THE APPEALS ARE DEEMED TO BE ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 13 TH DECEMBER, 2011. SD/- SD/- ( C.L. SETHI ) ( G.D. AGRAWAL ) JUDICIAL MEMBER VICE PRESIDENT DT. 13TH DECEMBER, 2011 GS COPY FORWARDED TO: 1. SHRI GURSEV SINGH MANCHANDA, NEW DELHI. 2. ITO, WARD-12(2), NEW DELHI. 3. CIT(A)-X, NEW DELHI. 4. CIT 4. DR BY ORDER DY. REGISTRAR ITA NO.4842/DEL/2010 & ITA 5039/D/2010 6