RAJEEV RAMESH ATEY, Nagpur V. I.T.O. WARD -7(1), Nagpur

ITA 494/NAG/2016

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 7696 (ITAT-NAGPUR)
• Duration Of Justice: 4 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-01-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2008-2009
• Appeal Filed On: 07-09-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: A R NINAWE
• Keywords: Unexplained cash credit; Gift; Opportunity of being heard; Corroborative evidences

Judgement Text

1 ITA NO. 494/NAG/2016. IN THE INCOME TAX APPELLATE TRIBUNAL, NAGPUR BENCH, NAGPUR BEFORE SHRI SHAMIM YAHYA, ACCOUNTANT MEMBER. (S.M.C.) I.T.A. NO. 494/NAG/2016 ASSESSMENT YEAR : 2008 - 09. RAJEEV RAMESH ATEY, THE INCOME - TAX OFFICER, NAGPUR. VS. WARD - 7(1), NAGPUR. PAN AHCPA4374L. APPELLANT. RESPONDENT. APPELLANT BY : SHRI AMAN JAIN. RESPONDENT BY : SHRI A.R. NINAWE. DATE OF HEARING : 15 - 12 - 2016 DATE OF PRONOUNCEMENT : 9 TH JANUARY, 2017. O R D E R. T HIS IS AN APPEAL BY THE ASSESSEE DIRECTED AGAINST THE ORDER OF L EARNED CIT (APPEALS) - II, NAGPUR DATED 9/5/2016 AND PERTAINS TO ASSESSMENT YEAR 2008 - 09 .T HE GROUNDS OF APPEAL READ AS UNDER : 1. THE LEARNED CIT(A) ERRED IN PASSING EX - PARTE ORDER WITHOUT FURTHER INVESTIGATING INTO ALLEGED ADDITIONS. 2. THE LEARNED CIT(A) ERRED IN LAW IN DISMISSING APPEAL WITHOUT MAKING FURTHER ENQUIRIES WHICH IS VERY MUCH WITHIN ITS JURISDICTION AS THE POWER OF CIT(A) IS CO - TERMINIUS WITH THAT OF AO. 2. T HE ASSESSING IN THIS CASE IS RETAIL DEALER OF PETROL AND LUBRICANT OIL . IN THE COURSE OF ASSESSMENT THE A SSESSING O FFICER NOTED THAT THERE WAS AN UNDISCLOSED BANK ACCOUNT IN ICICI BANK. IN EXPLANATION FOR THE SOURCE OF DEPOSIT IN THAT ACCOUNT ASSESSEE EXPLAINED AS UNDER : 2 ITA NO. 494/NAG/2016. I AM GIVING THE EXPLANATION AS REQUESTED BY YOUR G OOD SELF: OPENING CASH IN HAND FOR RS.600000.00: I HAD THE OPENING CASH IN HANDS AS I HAD RECEIVED THE CASH AS GIFT AT THE TIME OF MY MARRIAGE FROM THE WELL WISHER. SOME CASH WAS GIVEN TO ME BY FATHER & MOTHER. THE CASH WAS WITH ME IN HAND AND THE SAME IS REFLECTED IN THE BOOKS OF ACCOUNTS. CONFIRMATION FROM MR. SURESH LANJEWAR : MR. SURESH LANJEWAR IS MY FATHER IN LAW. AT PRESENT E IS NOT IN THE COUNTRY, ONCE HE IS BACK IN TOWN, THE CONFIRMATION AS REQUESTED BY YOUR GOOD SELF WILL BE SUBMITTED TO YOUR OF FICE. S UBSEQUENTLY ASSESSEE ALSO SUBMITTED CONFIRMATION FROM SHRI S.B. L NJEWAR. THE A SSESSING O FFICER DISBELIEVED THE DEPOSIT OUT OF OPENING CASH BALANCE BUT ACCEPTED THE EXPLANATION OF RECEIPT OF RS. 1 , 00,000 / - FROM FATHER - IN - LAW. ACCORDINGLY ASSESSING O FFICER ADDED THE SUM OF RS. 6 , 00,000 / - AS UNEXPLAINED CASH CREDIT. THE ASSESSING OFFICER FURTHER FOUND DEPOSITS OF RS. 45 , 898 / - AND RS.42 , 937 / - IN THE BACK ACCOUNT. THE A SSESSING O FFICER ALSO ADDED 8% OF THE AFORESAID SUM AMOUNTING TO RS. 7 , 107 / - AS PROFIT ON CONTRACT RECEIPT. 3. AGAINST ABOVE ORDER ASSESSEE APPEA L ED BEFORE THE L EARNED CIT(APPEALS). I N AN EX - PARTE ORDER OF L EARNED CIT(APPEALS) CONFORMED TH E AOS ACTION BY HOLDING AS UNDER : I HAVE CONSIDERED THE FACTS OF THE CASE AND THE SUBMIS SIONS MADE. IT IS SEEN THAT THE APPELLANT DID NOT PROVIDE ANY INFORMATION WITH REGARD TO THE SAID ICICI BANK ACCOUNT WHEN THE LD. AO REQUIRED THE APPELLANT TO FURNISH DETAILS IN RESPECT OF THE BANK ACCOUNTS. IT WAS ONLY WHEN THE LD. AO REQUIRED THE APPELLA NT TO SUBMIT DETAILS OF AMOUNTS CREDITED IN THE SAID ICICI BANK THAT THE APPELLANT CAME FORWARD AND HAS TO EXPLAIN THE DEPOSITS THEREIN BY STATING THAT IT HAD OPENING CASH BALANCE OF RS.6,00,000/ - AND THAT THE SAID CASH HAD BEEN RECEIVED ON HIS MARRIAGE FR OM THE RELATIVES AND WELL WISHERS. HOWEVER, NO SUPPORTING EVIDENCES WHATSOEVER WERE FURNISHED BY THE APPELLANT TO ESTABLISH HIS CASE. WHENEVER ANY ACCOUNT IS FOUND CREDITED IN 3 ITA NO. 494/NAG/2016. THE BOOKS OF ACCOUNTS OF AN APPELLANT, THE ONUS IS ON THE APPELLANT TO ESTABLISH BY WAY OF CREDIBLE EVIDENCES THAT THE SAID AMOUNTS ARE DULY EXPLAINED. SINCE THE APPELLANT HAS FAILED TO DO SO, I SEE NO REASON TO INTERFERE WITH THE FINDINGS OF THE LD. AO. CONSEQUENTLY THE ADDITION OF RS.6,00,000/ - IS HEREBY CONFIRMED. 4. A GAINST THE ABOVE ORDER , ASSESSEE IS IN APPEAL BEFORE THE ITAT 5. I HAVE HEARD BOTH THE COUNSEL AND PERUSED THE RECORDS. THE SUBMISSION OF THE LEARNED COUNSEL OF THE ASSESSEE IN THIS REGARD IS NOTED AS UNDER : IT IS CONTENDED BY THE LD. AO THAT THE CASH HELD BY THE A SSESSEE IS FROM UNEXPLAINED SOURCES, CITING REASONS THAT A PRUDENT BUSINESSMAN WOULD NOT KEEP CASH AT HOME. HOWEVER, THE ASSESSEE HAD JUSTIFIABLE REASONS TO HOLD CASH, WHICH ARE EXPLAINED BELOW : DURING THE YEAR UNDER CONSIDERATION, THE ASSESSEE DEPOSITED CASH IN THE PERSONAL SAVING ACCOUNT, WHICH HAS BEEN QUESTIONED BY THE LD. AO. THE SAID AMOUNT WAS HELD AS CASH IN HAND IN PREVIOUS YEAR, AND THE DETAILED BREAKUP OF THE SAID AMOUNT IS AS FOLLOWS : I. PART OF RECEIPTS SON THE OCCASION OF ASSESSEES MARRIAGE 3,50,000/ - II. BIRTHDAY GIFTS FROM FATHER AND MOTHER 2,50,000/ - III. BIRTHDAY GIFTS FROM ELDER UNCLE (SHRI VASANT ATEY) 25,000/ - IV. RESIDUAL AMOUNT FROM WITHDRAWALS IN PREVIOUS YEARS 75,000/ - OF THE ABOVE MENTIONED CASH AMOUNTS, RS.3,25,000/ - WAS KEPT WITH THE ASSESSEES WIFE AS A CUSTOM OF THE FAMILY, WHICH COULD BE UTILISED IN CASH OF CONTINGENCIES. FURTHER, THE AMOUNTS RECEIVED AS GIFT ON OCC ASION OF BIRTHDAY WAS KEPT FOR THE PURPOSE OF BUYING AN I DENTIFIED AGRICULTURAL LAND AT MOUZA MOHGAON, NEAR BAZARGAON. SINCE, IN PRACTICE, AN AGRICULTURIST DOES NOT MAINTAIN A BANK ACCOUNT, THE AFORESAID AMOUNT WAS HELD I CASH FOR MAKING PAYMENT. HOWEVER, THE AMOUNT KEPT ASIDE FOR THE PURPOSE OF PURCHASING AGRIC ULTURAL PROPERTY WAS USED FOR REPAIR, RENOVATION & FURNISHING OF THE EXISTING HOUSE. 4 ITA NO. 494/NAG/2016. LATER , THERE WAS UNFORTUNATE SEQUENCE OF EVENTS , BECAUSE OF WHICH THE ASSESSEE WAS FORCED TO USE THE CASH WHICH WAS KEPT FOR CONTINGENCIES. HENCE, THE ASSESSEE DEPOSITED THE AMOUNT HELD IN CASH, IN HIS SAVINGS BANK ACCOUNT . IN THE YEAR UNDER CONSIDERATION , ELDER DAUGHTER OF THE ASSESSEE STARTED GOING TO A PRIVATE SCHOOL THUS CASH FLOW FOR THE SAME STARTED SIGNIFICANTLY. LATER ON DURING THE YEAR , FATHER OF THE ASSESSEE BEING A HEART PAT I ENT , WAS ADMITTED TO HOSPITAL AND WAS DIAGNOSED WITH PROSTATE CANCER & THE MOTHER OF THE ASSESSEE WAS DIAGNOSED WITH BREAST CANCER . THIS CAUSED HEAVY CASHFLOWS TOWARDS MEDICAL TREATMENT AND MEDICATION (THE MEDICAL REPORTS ARE ATTACHED HEREWITH AS ANNEXURE A) . BEING AN EMERGENC Y S I TUAT I ON , ASSESSEE STARTED UTILISING THE SAFE MONEY HELD AS SECU R IT Y, BASED ON THE CUSTOMARY PRINCIPLES. IN CONCLUSION , IT MA Y BE STATED THAT IN THE ASSESSEE ' S LINE OF BUSINESS , AND AS A PRUDENT BUSINESSMAN, NO ONE WOULD KEEP IDLE CASH AND LOSE THE OPPORTUNITY OF EARNING RETURNS ON THE SAME . HOWEVER, THE CUSTOMS AND TRADITIONS OF THE FAMILY ARE INHERENT PART OF OUR SOCIETY, BASED ON SCIENTIFIC AND PRUDENT FACTS WHICH CAN'T BE IGNORED SOLEL Y ON THE BASIS OF MONETARY PRUDENCE. THE BASIC LOGIC BEHIND KEEPING CERTAIN AMOUNT OF MONEY AS DEPOSIT IS TO SAFEGUARD THE FAMILY IN FUTURE FROM THE UNCERTAIN INEVITABLE SITU ATIONS . AND IN TH I S CASE AND MANY MORE CASES , THE CUSTOMARY PRACTICES HAVE PROVED THEIR VALUES AND HELPED THE FAMILIES IN TACKLING DOWN THE TOUGH SITUATIONS. HENCE , RELYING ON THE ABOVE SUBMISSION THE ASSESSEE PLEADS 5 ITA NO. 494/NAG/2016. THAT T HE CASH HELD BY THE ASSESSEE AND DEPOSIT OF THE SAME IN THE BANK ACCOUNT IS LEGITIMATE AND DOES NOT ACCOUNT FOR THE UNEXPLAINED CASH CREDITS. 6. UPON CAREFUL CONSIDERATION I FIND THAT ASSESSEE WAS NOT ABLE TO PROPERLY CANVAS THE CASE BEFORE THE L EANED CIT(APPEALS) DUE TO MEDICAL AILMENTS. IN THE CIRCUMSTANCES IN MY CONSIDERED OPINION TH E ASSESSEE DESERVES THE CHANCE TO PURSUE THE CASE. SINCE ALL THE SUBMISSIONS WERE NOT BEFORE THE AUTHORITIES BELOW I DEEM IT APPROPRIATE TO REMIT THE ISSUE TO THE FILE OF THE A SSESSING O FFICER. THE A SSESSING O FFICER IS DIRECTED TO CONSIDER THE ISSUE A FRESH AFTER GIVING THE ASSESSEE AN OPPORTUNITY OF BEING HEARD. 7. IN THE RESULT THIS APPEAL BY THE ASSESSEE STANDS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 9 TH DAY O F JANUARY., 2017. SD/ - ( SHAMIM YAHYA) ACC OUNTANT MEMBER. NAGPUR, DATED: 9 TH JANUARY, 2017. 6 ITA NO. 494/NAG/2016. COPY FORWARDED TO : 1. RAJESH RAMESH ATEY, 251, LOKSEVA NAGR, BHAMTI, NAGPUR - 440022. 2. I.T.O., WARD - 7(1), NAGPUR. 3. PR. C.I.T. - II, NAGPUR. 4. CIT(APPEALS), - II, NAGPUR. 5. D.R., ITAT, NAGPUR. 6. GUARD FILE TRUE COPY BY ORDER ASSISTANT REGISTRAR, INCOME TAX APPELLATE TRIBUNAL, NAGPUR BENCH, NAGPUR. WAKODE.