ITO, Rohtak V. Sh. Krishan Singh, Rohtak

ITA 4916/DEL/2015

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 7068 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 1 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-09-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: SMC 2
• Next Hearing Date: 15-09-2016
• Assessment Year: 2011-2012
• Appeal Filed On: 30-07-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S K JAIN
• Assessee Lawyers: NAVEEN GUPTA
• Keywords: Additional evidence

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL NEW DELHI BENCH : SMC-II, NEW DELHI BEFORE SHRI SUNIL KUMAR YADAV, JUDICIAL MEMBER ITA NO.4916/DEL/2015 ASSESSMENT YEAR : 2011-12 THE INCOME TAX OFFICER, WARD-2, ROHTAK. VS. SHRI KRISHAN SINGH, S/O. SHRI HARPAL SINGH, H.NO.108, VPO. BAHU JAMALPUR, GADDI KHERI, ROHTAK. PAN: BSKPS 4326L APPELLANT RESPONDENT APPELLANT BY : SHRI S.K. JAIN, SR. DR RESPONDENT BY : SHRI NAVEEN GUPTA, ADVOCATE DATE OF HEARING : 15.09.2016 DATE OF PRONOUNCEMENT : 21.09.2016 O R D E R THIS APPEAL IS PREFERRED BY THE REVENUE AGAINST T HE ORDER OF CIT(APPEALS), ROHTAK DATED 28.05.2015 RELATING TO A DDITION OF RS.43,63,000 MADE BY THE ASSESSING OFFICER ON ACCOU NT OF UNEXPLAINED DEPOSITS MADE IN CASH IN THE ASSESSEES BANK ACCOUN T. 2. THE FACTS IN BRIEF BORNE OUT FROM THE RECORD AR E THAT INITIALLY ASSESSMENT WAS COMPLETED U/S. 143(1) OF THE INCOME- TAX ACT, 1961 [THE ACT] VIDE ORDER DATED 28.11.2011. ON THE BASIS OF AIR INFORMATION, THE ASSESSING OFFICER NOTICED THAT CASH OF RS.43,63,000 HAS BEEN DEPOSITED IN THE IDBI BANK, DELHI ROAD, ROHTAK. ASSESSEE WAS AS KED TO FURNISH COPY ITA NO.4916/DEL/2015 PAGE 2 OF 6 OF BANK ACCOUNTS MAINTAINED BY HIM AND HIS FAMILY M EMBERS. HE WAS ALSO ASKED TO EXPLAIN THE SOURCE OF DEPOSITS. IN RESPO NSE THERETO, THE ASSESSEE COULD FURNISH SOME INFORMATION AND MOST OF THE TIME HE SOUGHT ADJOURNMENTS ON ONE REASON OR THE OTHER. BEING NOT CONVINCED WITH THE EXPLANATION FURNISHED BY THE ASSESSEE, THE AO HAS M ADE AN ADDITION OF RS.43,63,000 ON ACCOUNT OF UNEXPLAINED CASH DEPOSIT IN THE BANK. 3. THE ASSESSEE PREFERRED AN APPEAL BEFORE THE CIT( APPEALS) AND EXPLAINED SOURCE OF DEPOSITS BEFORE HIM. THE SOURC E OF DEPOSITS EXPLAINED BY THE ASSESSEE WAS RECORDED BY THE CIT(A) IN PARA 2 OF HIS ORDER. I EXTRACT THE SAME FOR THE SAKE OF REFERENCE:- 1. 863000/-: APPELLANT HAD DEPOSITED 188000/- ON 8.6.2 010, 375000/- ON 12.6.2010 AND 300000/ - ON 28.6.2010, I N CASH IN HIS BANK ACCOUNT. APPELLANT IS ABOUT 38 YEARS OLD AND DOING BUSINESS FOR THE LAST ABOUT MORE THAN 15 YEARS. HE IS AN INCOME TAX ASSESSEE SINCE A.Y. 2007-08. THIS AMOUNT WAS DEPOSITED BY THE APPELLANT OUT OF HIS CAPITAL. COPY OF ITR FROM THE A.Y. 2007-08 TO 2011-12 ARE ENCLOSED HEREWITH AT PAGE 4 TO 8OF PB . 2. 35 , 00 , 000/- : APPELLANT HAD DEPOSITED 35,00,000/- ON 26.7.2010 IN HIS BANK ACCOUNT. SOURCE OF THIS AMOUN T IS AS UNDER: (I) 863000/-: APPELLANT HAD DEPOSITED 188000/- ON 8.6.2010 AND 375000/- ON 12.6.2010 IN HIS BANK ACCOUNT, WHICH WAS TRANSFERRED BY HIM TH. RTGS IN M /S TIN TIN INFRASTRUCTURE P. LTD. AS DEPOSITS. APPELLA NT HAD ALSO DEPOSITED 300000/- ON 28.6.2010 IN HIS BANK ACCOUNT WHICH WAS TRANSFERRED BY HIM TH. RTGS TO M/ S INSPIRE INDIA MARKETING P. LTD. AS DEPOSITS. THIS T OTAL AMOUNT OF 863000/- WAS RECEIVED BACK BY THE APPELLA NT ITA NO.4916/DEL/2015 PAGE 3 OF 6 IN CASH FROM THESE COMPANIES ON 25.7.2010, AND WAS AGAIN DEPOSITED IN THE BANK ACCOUNT ON 26.7.2010 IN CASH. CONFIRMATION LETTERS FROM THE COMPANIES ARE ENCLOSED HEREWITH AT PAGE 9 AND 10 OF PB. (II) 2637000/-: DURING THE YEAR, APPELLANT CAME IN CONTACT WITH ONE INVESTMENT COMPANY M/S FOREXX INDIA INVESTMENTS. THE COMPANY GAVE THE APPELLANT LUCRATIVE OFFERS AND PROMISED HIGHER RETURNS. APPELLANT BECAME THE AGENT OF THE COMPANY. HE PERSUADED PEOPLE TO INVEST IN THE COMPANY BY PROMISING THEM HANDSOME RETURNS ON THE INVESTMENTS AND COLLECTED 19500/- EACH F R OM THE SEVERAL OF HIS RELATIVES, FRIENDS AND PERSONS RESIDING IN HIS VILLAGE AND DEPOSITED THE COLLECTED AMOUNT IN CASH IN HIS BANK ACCOUNT. FROM THERE, HE TRANSFERRED THE AMOUNT TO THE COMPANY M/ S FOREXX INDIA INVESTMENTS, TH . RTGS. LATER ON, THE COMPANY PROVES TO BE A FRAUD AND RAN AWAY WITH THE HARD EARNED MONEY OF GENERAL PUBLIC. AFFIDAVITS AND PROOF OF IDENTITY OF 135 INVESTORS CONFIRMING THE TRANSACTION ARE ENCLOSED AT PAGE 11 TO OF PB. SINCE ALL THESE DOCUMENTS WERE IN THE POSSESSION OF OTHER PERSONS, APPELLANT COULD NOT FILE THESE DOCUMENTS BEFORE THE AO DURING THE ASSESSMENT PROCEEDINGS. HENCE AN APPLICATION U/R 46A I S ALSO ENCLOSED TO ADMIT ALL THESE DOCUMENTS AS ADDITIONAL EVIDENCE . 4. ON THIS EXPLANATION FURNISHED BY THE ASSESSEE, T HE CIT(APPEALS) HAS CALLED FOR A REMAND REPORT FROM THE ASSESSING O FFICER AND DURING THE REMAND PROCEEDINGS, THE ASSESSING OFFICER DIRECTED THE ASSESSEE TO APPEAR IN PERSON AND TO PRODUCE 10 PERSONS WHO FILE D THE AFFIDAVITS. ACCORDINGLY, THESE PERSONS HAVE APPEARED AND ORAL E NQUIRIES WERE MADE FROM THESE PERSONS IN WHICH THEY HAVE CONFIRMED THE TRANSACTION IN THEIR STATEMENTS. ACCORDINGLY REMAND REPORT WAS SUBMITTE D TO THE CIT(A) AND IN ITA NO.4916/DEL/2015 PAGE 4 OF 6 THE LIGHT OF REMAND REPORT, THE CIT(A) HAS ACCEPTED THE EXPLANATION FURNISHED BY THE ASSESSEE AND DELETED THE ADDITION. THE FINDINGS OF THE CIT(APPEALS) ARE EXTRACTED HEREUNDER FOR THE SAKE O F REFERENCE:- REJOINDER RESPECTFULLY SUBMITS THAT DURING REMAND PROCEEDING S, THE ASSESSING OFFICER DIRECTED THE APPELLANT TO APPEAR IN PERSON AND TO PRODUCE 10 OF THE PERSONS WHO FILED AFFIDAVITS. IN RESPONSE, APPELLANT APPEARED BEFORE AO AND ALSO PRODUCE 10 PE RSONS. AO MAKE ADEQUATE ORAL ENQUIRIES FROM ALL THESE PERSONS , ALL THE PERSONS CONFIRMED THE TRANSACTION IN THEIR STATEMEN T AND IN HIS REMAND REPORT, AO GAVE NO ADVERSE FINDING. IN THE REMAND REPORT, AO SUBMITTED THAT APPELLANT HAD FILED ONLY COPY OF ACKNOWLEDGEMENT OF RETURN AND NO COMPUTATION OF INCOME OR CAPITAL ACCOUNT ETC. WAS F ILED. IN THIS REGARD, IT IS TO SUBMIT THAT IT IS VERY STRANGE ON THE PART OF ASSESSING OFFICER TO SAY THAT APPELLANT DIDN'T FILE COMPUTATION OF INCOME OR CAPITAL ACCOUNT ETC. WHEN APPELLANT IS PR OVIDING COPY OF ACKNOWLEDGEMENT OF RETURN FILED, TO THE AO WHICH CLEARLY SHOWS THE DATE OF FILING OF RETURN AND ITS ACKNOWLE DGEMENT NUMBER, AO CAN VERY WELL INVESTIGATE THE RETURNS WH ICH WERE FILED IN HIS OFFICE. MOREOVER, ASSESSING OFFICER A LSO NEVER DIRECTED TO THE APPELLANT TO FILE THESE DOCUMENTS. IN VIEW OF ABOVE DISCUSSION, IT IS PRAYED THAT AL L THE ADDITIONS MADE MAY KINDLY BE DELETED AND APPEAL OF THE APPELLANT MAY KINDLY BE ALLOWED AND OBLIGE. 3. A PERUSAL OF THE FACTS ON RECORD, THE REMAND RE PORT OF THE AO DATED 27.04.2015 AND THE SUBMISSIONS MADE BY THE APPELLANT REVEAL THAT ALL TRANSACTIONS HAVE BEEN EXAMINED BY THE AO AND NOTHING ADVERSE HAS BEEN FOUND AFTER EXAMINING THEM . TO STATE THAT NO CAPITAL ACCOUNT OR COMPUTATION WAS FILED IS NOT A CONCLUSIVE FINDING WHEN ALL RETURNS WERE AVAILABLE WITH THE AO. NO COGENT EVIDENCE IS ON RECORD FOR NOT ACCEPTING T HE ASSESSEE'S EXPLANATION. NOR HAVE ANY ENQUIRIES BEEN MADE BY TH E AO. THEREFORE, I DELETE THE SAID ADDITION. ITA NO.4916/DEL/2015 PAGE 5 OF 6 5. AGGRIEVED, THE REVENUE IS IN APPEAL BEFORE THE T RIBUNAL WITH THE SUBMISSION THAT THE ASSESSING OFFICER HAS MADE OUT A CASE THAT ASSESSEE HAS NO SUFFICIENT MEANS FOR THE DEPOSITS IN CASH, B UT THE CIT(A) HAS ACCEPTED THE SAME WITHOUT ANY JUSTIFIABLE REASONS. WHEREAS, THE LD. COUNSEL FOR THE ASSESSEE HAS CONTENDED THAT THE ASS ESSEE HAS FILED DETAILED EXPLANATION BEFORE THE CIT(APPEALS) AND TH E CIT(A) HAS TAKEN COGNIZANCE OF THE SAME, AFTER CALLING FOR A REMAND REPORT. 6. HAVING CAREFULLY EXAMINED THE ORDER OF LOWER AUT HORITIES IN THE LIGHT OF RIVAL SUBMISSIONS, I FIND THAT BEFORE THE ASSESS ING OFFICER THE ASSESSEE COULD NOT FURNISH COMPLETE EVIDENCE WITH RESPECT TO SOURCE OF DEPOSITS, BUT BEFORE THE CIT(APPEALS) HE HAS FILED DETAILED EXPLA NATION WHICH WAS EXAMINED BY THE CIT(APPEALS) IN THE LIGHT OF REMAND REPORT SOUGHT ON THE ADDITIONAL EVIDENCE AND BEING CONVINCED WITH THE EX PLANATION OF THE ASSESSEE, THE CIT(APPEALS) HAS DELETED THE ADDITION . 7. DURING THE COURSE OF HEARING, THE LD. DR COULD N OT POINT OUT SPECIFIC DEFECTS IN THE ORDER OF CIT(APPEALS), WHEREAS THE A SSESSEE HAS CATEGORICALLY EXPLAINED THAT RS.26,37,000 WAS COLLE CTED FROM DIFFERENT PERSONS ON BEHALF OF M/S. FOREXX INDIA INVESTMENTS, WHICH WAS DEPOSITED IN HIS ACCOUNT AND ON THE NEXT DAY IT WAS TRANSFERR ED THROUGH RTGS TO THE ACCOUNT OF M/S. FOREXX INDIA INVESTMENTS. SIMILAR IS THE POSITION WITH RESPECT TO THE OTHER DEPOSITS ALSO. THIS EXPLANATI ON WAS EXAMINED BY THE CIT(APPEALS) ,BUT HE COULD NOT FIND ANY FAULT THERE IN. SINCE THE ITA NO.4916/DEL/2015 PAGE 6 OF 6 CIT(APPEALS) HAS ADJUDICATED THE ISSUE IN THE LIGHT OF GIVEN FACTS AND CIRCUMSTANCES OF THE CASE IN THE RIGHT PERSPECTIVE, I FIND NO INFIRMITY THEREIN AND I CONFIRM HIS ORDER. 8. IN THE RESULT, THE APPEAL OF THE REVENUE STANDS DISMISSED. PRONOUNCED IN THE OPEN COURT ON THIS 21 ST DAY OF SEPTEMBER 2016. SD/- (SUNIL KUMAR YADAV ) JUDICIAL MEMBER NEW DELHI, DATED, THE 21 ST SEPTEMBER, 2016. /D S/ COPY TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR, ITAT, NEW DELHI. ASSISTANT REGISTRAR, ITAT, NEW DELHI.