Sh. Karan Bhalla, New Delhi V. ITO, New Delhi

ITA 4862/DEL/2014

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 2977 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 9 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-06-2017
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: SMC
• Next Hearing Date: 16-05-2017
• Assessment Year: 2008-2009
• Appeal Filed On: 05-09-2014
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: R P MALL A; HIM SHRI C S AGARWAL
• Keywords: Gift; Income from undisclosed sources; Additional evidence
• Section: 144

Judgement Text

PAGE 1 OF 7 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH - SMC NEW DELHI BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER ITA NO.4862/DEL/201 4 ASSESSMENT YEAR : 2008-09 KARAN BHALLA W-3/2 LANE, WESTERN AVENUE, SAINIK FARMS, NEW DELHI 110 062 PAN AJLPB2687C VS. ITO WARD-9(2) NEW DELHI. (APPELLANT) (RESPONDENT) PER BHAVNESH SAINI, JUDICIAL MEMBER ORDER THIS APPEAL BY ASSESSEE HAS BEEN DIRECTED AGAINST T HE ORDER OF LD. CIT(A)() XI NEW DELHI DATED 24 TH JUNE, 2014 FOR ASSESSMENT YEAR 2008-09 CHALLENGING THE ADDITION OF RS. 17,31,500/- ON ACCOUNT OF CASH DEPOSIT IN THE BANK ACCOUNT. 2. BRIEFLY THE FACTS OF THE CASE ARE THAT THE ASSES SEE FILED RETURN OF INCOME AT RS. 2,48,000/-. THE CASE WAS SELECTED FOR SCRUTINY. THE ASSESSEE WAS ASKED TO EXPLAIN THE SOURCE OF THE CAS H DEPOSITED BY HIM ASSESSEE BY : SHRI C.S. AGARWAL AND SHRI R.P. MALL, ADVOCATE DEPARTMENT BY: MS. BEDOBANI, SR. DR DATE OF HEARING 25//05/2017 DATE OF PRONOUNCEMENT 09/06/2017 ITA NO. 4862/DEL/2014 KARAN BHALLA VS. ITO PAGE 2 OF 7 IN SAVING BANK ACCOUNT MAINTAINED WITH INDUSIND BAN K , GURGAON ON 20 OCCASIONS TOTALING TO SUM OF RS. 17,31,500/-. THE A SSESSEE WAS ASKED TO FURNISH COPY OF THE BANK ACCOUNT, STATEMENT OF AFFA IRS / BALANCE SHEET FOR ASSESSMENT YEAR UNDER APPEAL AS WELL AS OF LAST TWO YEARS ALONG WITH HOUSE HOLD WITHDRAWALS ETC. AND FRESH INVESTMENTS O F PROPERTY WITH DOCUMENTARY EVIDENCES. THE ASSESSEE HOWEVER DID NOT COMPLY WITH THE STATUTORY NOTICES. THE AO IN THE ABSENCE OF ANY EXP LANATIONS FROM THE SIDE OF THE ASSESSEE PASSED EX PARTE ASSESSMENT ORD ER U/S 144 OF THE I.T. ACT AND MADE THE ADDITION OF RS. 17,31,500/- A ND TREATED THE SAME AS INCOME OF ASSESSEE FROM UNDISCLOSED SOURCES. THE ADDITION WAS CHALLENGED BEFORE LD. CIT(A). THE ASSESSEE ALSO REQ UESTED FOR ADMISSION OF ADDITIONAL EVIDENCES WHICH WERE ADMITT ED. THE ASSESSEES WRITTEN SUBMISSION IS REPRODUCED IN IMPUGNED ORDER IN WHICH THE ASSESSEE EXPLAINED THAT DURING THE YEAR ASSESSEE HA D WITHDRAWN CASH AMOUNTING TO RS. 10,16,968/- FROM THE SAME BANK ACC OUNT AND HAVE BEEN USED TO MAKE THE DEPOSIT. IT WAS ALSO EXPLAINE D THAT FATHER OF THE ASSESSEE DURING THE MARCH, 2008 SOLD SOME VALUABLES FOR A SUM OF RS. 44 LACS OUT OF WHICH RS. 50,000/- WAS DEPOSITED BY ASSESSEE IN HIS BANK ACCOUNT IN MARCH, 2008. THE ASSESSEES MARRIAGE TOO K PLACE IN THE MONTH OF FEBRUARY, 2007. A CONSIDERABLE SUM OF MONE Y WAS RECEIVED BY THE ASSESSEE FROM HIS FRIENDS AND RELATIVES AS GIFT ON THE OCCASION OF HIS MARRIAGE. THE AO FILED THE REMAND REPORT AND EXPLAI NED THAT ASSESSEE FAILED TO EXPLAIN THE SOURCE OF CASH DEPOSIT IN THE BANK ACCOUNT. THE RECEIPT OF THE GIFT AT THE TIME OF MARRIAGE AND BIR THDAY IS AFTER THOUGHT ITA NO. 4862/DEL/2014 KARAN BHALLA VS. ITO PAGE 3 OF 7 AND CANNOT BE RELIED UPON IN THE ABSENCE OF ANY SUP PORTING DOCUMENTS. THE ASSESSEE WAS HAVING OPENING CASH IN HAND, THERE WAS NO NEED TO WITHDRAW THE AMOUNT FROM THE BANK. THE WITHDRAWAL F ROM THE BANK HAS NOT BEEN USED TO MAKE THE DEPOSIT AGAIN. 3. LD. CIT(A) CONSIDERING THE EXPLANATION OF THE AS SESSEE CONFIRMED THE ADDITION AND DISMISSED THIS GROUND OF APPEAL OF ASSESSEE. HIS FINDINGS IN PARA 8.2 OF THE APPELLATE ORDER IS REPR ODUCED AS UNDER :- 8.2 ON CONSIDERING THE FACTS OF THE CASE AND WRITT EN SUBMISSIONS MADE BY THE APPELLANT, REGARDING THE SO URCE OF CASH DEPOSIT OF RS. 17,31,500/- IN INDUSIND BANK , THE APPELLANT HAS TRIED TO EXPLAIN THE SOURCE OF SUCH CASH IN THE FOLLOWING WAY : CASH SUMMARY FROM 1.4.2006 TO 31.3.2007 OPENING BALANCE 325000 325,000.00 SALARY 40000 GIFT RECEIVED ON MARRIAGE 664532 GIFT RECEIVED ON BIRTHDAY 485000 CASH WITHDRAWAL FROM INDUSIND BANK 449550 1,639,082.00 CASH DEPOSITS IN INDUSIND BANK 623833 DRAWINGS 240249 864,082.00 CASH IN HAND 1,100,000.00 CASH SUMMARY FROM 1.4.2007 TO 31.3.2008 OPENING BALANCE 1,100,000.00 1,100,000.00 ADD : RECEIPTS BIRTHDAY GIFT FROM PARENTS 50,000.00 CASH WITHDRAWAL FROM BANK 984,968.00___ ________ _______ 1, 034,968.00 1,034,968.00 LESS: PAYMENTS CASH DEPOSITED IN BANK 1,731,500.00 DRAWINGS 400,000.00_________________ 2,131,500.00 2,131,500.00 CLOSING BALANCE 3,4 68.00 DETAILS OF WITHDRAWALS FROM BANK ITA NO. 4862/DEL/2014 KARAN BHALLA VS. ITO PAGE 4 OF 7 DURING 2007-08 F.Y. (SUMMARISED) S. NO. MONTH AMOUNT 1. AUGUST - 07 315000 2. SEPTEMBER - 07 15650 3. OCTOBER - 07 47818 4. NOVEMBER - 07 482500 5. DECEMBER - 07 25000 6. JANUARY - 08 74000 7. FEBRUARY - 08 25000 TOTAL 984968 IT IS OBSERVED THAT THE EXPLANATION OFFERED BY THE APPELLANT ARE VAGUE AND SELF-SERVING. NO INDEPENDENT EVIDENCES IN THE F ORM OF WEALTH TAX RETURN OR CASH FLOW CHART FILED WITH ITR COULD BE P RODUCED BY THE APPELLANT. JUST TO SHOW OPENING CASH BALANCE OF RS. 11 LAC AS ON 01.04.2007, THE APPELLANT HAS SHOWN MASSIVE GIFTS O F MORE THAN RS. 11 LAC IN MARRIAGE AND BIRTHDAY OF THE APPELLANT. NO E VIDENCES IN WHATSOEVER ARE PRODUCED IN SUPPORT OF MARRIAGE GIFT S AND BIRTHDAY GIFTS ALLEGEDLY RECEIVED BY THE APPELLANT. MOREOVER, IF A T ALL SOME CUSTOMARY GIFTS ARE RECEIVED BY THE APPELLANT AT THE TIME OF MARRIAGE OR BIRTHDAY, THE EXPENDITURE INCURRED IN SUCH CELEBRATIONS IS MU CH MORE THAN THE GIFTS RECEIVED AND THE APPELLANT IS SILENT ON THIS POINT. IT IS APPARENT THAT THE APPELLANT HAS CONCOCTED THE STORY JUST TO EXPLA IN THE SOURCE OF CASH DEPOSITED BY HIM IN THE BANK ACCOUNT. THEREFORE, TH E BENEFIT OF OPENING CASH BALANCE OF RS. 11 LAC CANNOT BE GIVEN TO THE A PPELLANT. REGARDING THE CASH DEPOSITS OUT OF CASH WITHDRAWALS MADE BY T HE APPELLANT FROM THE SAME ACCOUNT, I HAVE EXAMINED THE ENTRIES OF BA NK ACCOUNT IN DETAIL. THE WITHDRAWALS HAVE BEEN MADE IN SMALL AMOUNTS VER Y FREQUENTLY DURING THE MONTH, THOUGH THE MONTHLY SUMMARY OF' WI THDRAWALS SHOW A BIGGER FIGURE. I FULLY AGREE WITH THE AO'S REMAND R EPORT ON THE POINT THAT THERE SHOULD NOT HAVE BEEN ANY URGENCY IN MAKING FU RTHER WITHDRAWALS FROM THE BANK ACCOUNT IF THE APPELLANT WAS HAVING S UFFICIENT CASH BALANCE WITH HIM. IN FACT IT IS CLEAR FROM THE BANK ACCOUNT THAT WITHDRAWAL IS FULLY UTILIZED BEFORE MAKING THE NEXT WITHDRAWAL. THEREFORE, THE APPELLANT'S ATTEMPT TO TAKE BENEFIT OF CASH WIT HDRAWAL OF RS. 9,84,986/- FOR EXPLAINING THE SOURCE OF CASH DEPOSI T IS OUTRIGHTLY REJECTED. THUS, THE ENTIRE AMOUNT OF CASH DEPOSIT O F RS. 17,31,500/- REMAINS UNEXPLAINED. THEREFORE, THE AO'S ACTION IN MAKING ADDITION OF RS.17,31,500/- IN APPELLANT'S INCOME TREATING THE S AME AS INCOME FROM UNDISCLOSED SOURCES IS UPHELD. GROUND NO. 5 OF THE APPEAL IS DISMISSED. 4. AFTER CONSIDERING RIVAL SUBMISSIONS, I DO NOT FI ND ANY MERIT IN THIS GROUND OF APPEAL OF ASSESSEE. THE ASSESSEE HAS GIVE N THE DETAILS OF SOURCE OF THE CASH WHICH ARE REPRODUCED IN THE ORDE R OF THE LD. CIT(A). ITA NO. 4862/DEL/2014 KARAN BHALLA VS. ITO PAGE 5 OF 7 HOWEVER NO SUPPORTING DOCUMENTS HAVE BEEN FILED. TH E ASSESSEE DID NOT PRODUCE ANY INDEPENDENT EVIDENCE IN SUPPORT OF CASH FLOW STATEMENT. NO EVIDENCE OF ANY AMOUNT IS RECEIVED ON OCCASION OF MARRIAGE AND BIRTHDAY HAVE BEEN FILED. EVEN DURING THE COURSE OF ARGUMENTS, THE ASSESSEE WAS NOT ABLE TO PRODUCE ANY EVIDENCE TO PROVE THAT IN FACT MARRIAGE OF THE ASSESSEE HAD BEEN PER FORMED IN FEBRUARY, 2007. ANYHOW IF THE CLAIM OF ASSESSEE MAY BE CONSID ERED FAVOURABLY FOR RECEIPT OF MARRIAGE GIFT AND BIRTHDAY GIFT, ASSESSE E WOULD HAVE SPENT SOME EXPENDITURE ON THOSE CELEBRATIONS BUT NO EVIDE NCE IN THIS REGARD HAS ALSO BEEN FILED. LD. CIT(A) AFTER EXAMINING THE BANK ACCOUNT NOTED THAT WITHDRAWALS HAVE BEEN MADE IN SMALL AMOUNT VER Y FREQUENTLY. THEREFORE IT COULD NOT BE CONSIDERED AS REDEPOSIT I N THE BANK ACCOUNT OF THE ASSESSEE. THE ASSESSEE FAILED TO CO-RELATE THE WITHDRAWALS FROM THE BANK ACCOUNT FOR THE PURPOSE OF REDEPOSIT IN THE SA ME ACCOUNT. NO EVIDENCE IN SUPPORT OF CASH SUMMARY HAS BEEN FILED. THEREFORE WHATEVER CONTENTIONS HAVE BEEN RAISED BY THE ASSESSEE BEFORE THE AUTHORITIES BELOW TO EXPLAIN CASH DEPOSIT IN THE BANK ACCOUNT H AS NOT BEEN SUPPORTED BY ANY EVIDENCE. LD. COUNSEL FOR ASSESSEE RELIED UPON ORDER OF ITAT DELHI BENCH IN THE CASE OF DCIT VS. SUNIL B HALLA IN ITA NO. 6689/DEL/2013 DATED 12 TH MAY, 2017 IN WHICH DEPARTMENTAL APPEAL IN THE CASE OF ASSESSEES FATHER HAS BEEN DISMISSED IN WHICH THE AO IN THE REMAND REPORT HAS ACCEPTED SUBSTANTIAL AVAILABILITY OF CASH WITH THAT ASSESSEE AND THE AO ALSO AGREED TO THE AVAILABILITY OF THE FUNDS WITH THE ASSESSEE AND THAT THE CASH WITHDRAWALS OF RS. 15 LA CS POST LAST DATE OF ITA NO. 4862/DEL/2014 KARAN BHALLA VS. ITO PAGE 6 OF 7 DEPOSIT WAS CONSIDERED FAVOURABLY. HOWEVER IN THE C ASE OF ASSESSEE THE AO HAS OBJECTED TO THE EXPLANATION OF THE ASSESSEE IN THE REMAND REPORT BECAUSE ASSESSEE HAS MADE UP STORY AFTER THOUGHT. T HE ASSESSEE FAILED TO EXPLAIN SOURCE OF THE CASH DEPOSIT IN THE BANK A CCOUNT. THEREFORE ORDER IN THE CASE OF DCIT VS. SUNIL BHALLA (SUPRA) WILL NOT APPLY TO THE FACT OF THE CASE. LD. COUNSEL FOR ASSESSEE ALSO REL IED UPON JUDGMENT OF THE HON'BLE SUPREME COURT IN THE CASE OF GOURI PRA SAD BAGARIA VS. CIT (1961) 42 ITR 112 (SUPREME COURT) IN WHICH THE TRIB UNAL HAD BELIEVED THE ASSESSEE WORDS IN VIEW OF HIS CONDUCT AND PAST HISTORY AND THE HON'BLE SUPREME COURT HELD THAT THE TRIBUNAL HAVING BELIEVED THE ASSESSEES STATEMENT, THERE WAS AN END OF THE MATTE R IN SO FAR AS THE FACT WAS CONCERNED. I MAY NOTE THAT THE CONDUCT OF THE ASSESSEE IN THE PRESENT CASE WAS WHOLLY NON COOPERATIVE BEFORE THE AO BECAUSE THE ASSESSEE DESPITE STATUTORILY NOTICE ISSUED TO HIM C ALLING FOR VARIOUS EXPLANATION ABOUT SOURCE OF THE CASH DEPOSIT IN THE BANK ACCOUNT FAILED TO RESPOND TO THE STATUTORILY NOTICES AND DID NOT FILE ANY EXPLANATION OR PRODUCE ANY EVIDENCE TO EXPLAIN SOURCE OF THE CASH DEPOSIT IN THE BANK ACCOUNT OF THE ASSESSEE. THE CONDUCT OF THE ASSESSE E THEREFORE SPEAKS AGAINST THE ASSESSEE. THE CRUX OF THE MATTER WOULD THAT ASSESSEE DID NOT PRODUCE ANY RELEVANT OR COGENT EVIDENCE BEFORE THE AUTHORITIES BELOW TO EXPLAIN THE SOURCE OF CASH DEPOSIT OF RS. 17,31,500 /-. THEREFORE NO INTERFERENCE IS CALLED FOR IN THE MATTER. THE APPEA L OF THE ASSESSEE STANDS DISMISSED. ITA NO. 4862/DEL/2014 KARAN BHALLA VS. ITO PAGE 7 OF 7 5. IN THE RESULT APPEAL OF THE ASSESSEE IS DISMISSE D. PRONOUNCED IN THE OPEN COURT. SD/- ( BHAVNESH SAINI ) JUDICIAL MEMBER DATED: 09.06.2017 *VEENA* COPY FORWARDED TO: - 1. APPELLANT 2. RESPONDENT 3. PRINCIPAL CIT 4. CIT(A) 5. DR, ITAT TRUE COPY BY ORDER, ASSISTANT REGISTRAR