M/s. Raj Kumar Jain, New Delhi V. ITO, New Delhi

ITA 4950/DEL/2011

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 91001 (ITAT-DELHI)
• Duration Of Justice: 3 year(s) 5 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-04-2015
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: F
• Next Hearing Date: 09-04-2015
• Assessment Year: 2008-2009
• Appeal Filed On: 08-11-2011
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: VIKRAM SAHAY
• Keywords: Unexplained expenditure; Salary income; Assessment record
• Section: 69C; 143(3)

Judgement Text

IN TH E INCOME TAX APPELLATE TRIBUNAL DELHI BENCH F : NEW DELHI BEFORE SHRI G .C. GUPTA , HON BLE VICE PRESIDENT AND SHRI I NTURI RAMA RAO , ACCOUNTANT MEMBER ITA NO. 4950 /DEL/201 1 ASSESSMENT YEAR 200 8 - 0 9 M/S RAJ KUMAR JAIN VS. INCOME TAX OFFICER, W - 19/ 9, WESTERN AVENUE WARD 14(3) , SAINIK FAR M , DELHI. NEW DELHI (PAN AA EPJ 2076 K ) ( APPELLANT) (RESPONDENT) DATE OF HEARING : 0 9 .0 4 .2015 DATE OF PRONOUNCEMENT : 24 . 0 4 .2015 APPELLANT BY : NONE RESPONDENT BY : SHRI VIKRAM SAHAY , SR. DR ORDER PER SHRI I NTURI RAMA RAO , A M : 1. THIS IS AN APPEAL FILED BY THE ASSESSEE FOR THE AY 2008 - 09 AGAINST THE ORDER OF COMMISSIONER OF INCOME TAX (APPEALS) - XVII, NEW DELHI DATED 30.09.2011 IN ITA NO. 150/10 - 11 . 2. HOWEVER, AT THE TIME OF HEARING NO ONE WAS PRESENT ON BEHALF OF THE ASSESSEE. THE NOTICE FOR THE DATE OF HEARING HAS BEEN INTIMATED ON 05.11.2014. DESPITE THE SAME NEITHER THE ASSESSEE WAS PRESENT NOR ANY REQUEST FOR ADJOURNMENT HAS BEEN PLACED BEFORE US. IT IS FURTHER SEEN THAT IT IS RECALLED MATTER. ON THE EARLIER OCCASION ALSO THE APPEAL WAS DISMISSED FOR NON - APPEARANCE ON 10.01.2012. IT A NO S . 4950 /DEL /201 1 2 HOWEVER, ON RECALL PETITION FILED BY THE ASSESSEE, THE ORDER WAS RECALLED BY THE ORDER DATED 05.04.2013. THIS ONLY GOES TO SHOW THAT TH E ASSESSEE IS NOT SERIOUS IN PURSUING THE APPEAL. THEREFORE, WE PROCEED TO DISPOSE OF THE APPEAL ON MERITS. 3. THE BRIEF FACTS OF THE CASE ARE THE ASSESSEE IS AN INDIVIDUAL DERIVING INCOME FROM SALARY INCOME FOR THE AY 2008 - 09 . T HE ASSESSEE FILED THE RETU RN OF INCOME ON 24.03.2009, DECLARING INCOME OF RS.13,20,889/ - . AGAINST THE SAID RETURN OF INCOME , ASSESSMENT WAS MADE U/S 143(3) OF THE ACT VIDE ORDER DATED 21.12.2010 BY INCOME TAX OFFICER, WARD - 14(3), NEW DELHI AFTER MAKING ADDITION OF RS.43,000/ - TOWAR DS HOUSEHOLD EXPENDITURE. BEING AGGRIEVED , THE ASSESSEE PREFERRED AN APPEAL BEFORE THE CIT(A) - XVII, NEW DELHI WHO VIDE ORDER DATED 30.09.2011 , ENHANCED THE ADDITION BY RS.6,2 3 ,000/ - . THE CIT(A) AFTER GOING THROUGH THE DETAILS FILED, HAD COME TO THE CONCLUS ION THAT THE ADDITIONAL SHOULD BE ENHANCED BY RS.6.2 3 LACS. ACCORDINGLY, HE HAD PUT THE APPELLANT ON NOTICE AS REQUIRED BY THE PROVISIONS OF THE ACT. THE CIT(A) HAD DEALT THE SAME VIDE PARA S NO. 2.3 TO 2.5 & 5.3 OF THE CIT(A) WHICH IS REPRODUCED AS UNDER: - ' SUB: - NOTICE U/S 251(2) OF THE IT ACT. 1961 IN THE CASE OF SHRI RAJ KUMAR JAIN. FOR THE ASSESSMENT YEAR 2008 - 09 - REG - PLEASE REFER TO YOUR APPEAL FOR THE ASSESSMENT YEAR 2008 - 09 FILED ON 28.01.2011. 1. FROM THE DETAILS SUBMITTED BY YOUR AR, IT IS S EEN THAT YOU HAVE PAID RS.60, 000 / - PER MONTH AS CASH TOWARDS RENT OF YOUR SAINIK FARM RESIDENCE TO THE RENT ACCOUNT IN THE BOOKS OF M / S PRJ ENTERPRISES LTD. FOR THE RELEVANT ASSESSMENT YEAR. THE TOTAL AMOUNT PAID IS RS. 6,20, 000 / - AS 60,000 / - PER MONTH IS PAID FOR 10 MONTHS FROM JUNE, 2007 TO MARCH, 2008 WHILE R S . 10,000/ - PER MONTH IS PAID FOR THE MONTHS OF APRIL & MAY, 2007. YOUR ENTIRE SALARY INCOME OF IT A NO S . 4950 /DEL /201 1 3 R S . 100,000/ - PER MONTH AND RS.60,000 / - AS HOUSE RENT ALLOWANCE IS SEEN CREDITED IN YOUR INDIVIDUAL LEDG ER ACCOUNT IN M / S PRJ ENTERPRISES LTD. THERE IS NO WITHDRAWAL IN THIS INDIVIDUAL LEDGER ACCOUNT TO MAKE THE PAYMENT OF RS. 6,20, 000 / - PAID AS CASH TO THE RENT ACCOUNT IN M / S PRJ ENTERPRISES LTD. AS PER YOUR AR'S LETTER DATED 19.04.2011, YOUR WITHDRAWAL FR OM THE ABOVE LEDGER ACCOUNT IS ONLY RS.2,08,000 / - DURING THE YEAR. 2. FROM THE DETAILS OF CASH WITHDRAWALS SUBMITTED, IT IS ALSO SEEN THAT THE WITHDRAWALS ON 10.12 . 200.7, 04.11.2008, 06.02.2008 AND 17.03.2008 TOTA LING RS.40,000 / - I.E. R S .10,000 / - REPRES ENTS CASH PAID FOR DEPOSIT IN UNION BANK OF INDIA. THESE DETAILS INDICATE THAT DURING THE 6 MONTHS PERIOD FROM 01.10.2007 TO 31.03.2008 THE ONLY CASH WITHDRAWAL MADE FROM THE ABOVE LEDGER ACCOUNT IS RS.14,000 / - MADE ON 30.12.2007. THEREFORE, THE ADDITION M ADE BY THE AO IN THE ASSESSMENT ORDER FOR INADEQUATE WITHDRAWAL FOR HOUSEHOLD EXPENSES APPEARS TO BE CORRECT AT LEAST FOR THE PERIOD BETWEEN 01.10.2007 AND 31.03.2008. BASED ON THE AO'S ESTIMATE OF RS.10,000 / - PER MONTH, AMOUNT OF RS.46,000 / - I.E. RS.10,00 0X6=60000 - 14000 (EXPLAINED) NEEDS TO BE ADDE D, INSTEAD OF RS.43,000/ - ADDED BY THE AO. 3. THEREFORE, IN EXERCISE OF POWERS AS PER PROVISIONS OF SECTION 251(1)(A) OF THE I. T. ACT, 1961, I PROPOSE TO ENHANCE THE INCOME BY RS.6,23,000 / - I.E. RS.6,20,000 / - U / S 69C OF THE I. T. ACT, 1961 FOR UNEXPLAINED EXPENDITURE AND RS.3,000 / - AS INADEQUATE WITHDRAWAL FOR HOUSEHOLD EXPENSES. 4. YOU MAY SUBMIT YOUR EXPLANATION IF ANY, IN WRITING DURING THE HEARING ON 11.07.2011 AT 11.00 A.M.' 2.4. THE APPELLANT'S AR FINALL Y APPEARED ON 21.07.2011 AND SUBMITTED THE FOLLOWING WRITTEN SUBMISSION: 'THE APPELLANT RESPECTFULLY SHOWETH: 1. THAT REFERRING TO PARA 2 OF THE NOTICE FIRST, THE APPELLANT SUBMITS THAT THE APPELLANT HAD ALREADY TAKEN INTO ACCOUNT THE AMOUNT O F RS. 40, 000 / - WHICH I:S INCLUDED IN THE TOTAL AMOUNT OF RS. 77,000 / - AS RE - DEPOSITED WITH THE BANK. THE KIND ATTENTION OF THE LD. CIT IS INVITED IN THIS BEHALF TO THE APPELLANT'S LETTER DATED 19.04.2011 WHICH IS ALREADY ON RECORD. AFTER ACCOUNTING FOR THE SAID RE - DEPOSIT THE APPELLANT HAS STILL AVAILABLE A CASH IN HAND OF RS.1,38,000 / - (RS.2,15,084 - RS.77,000). THE LD. AO HAS ESTIMATED THE HOUSE - HOLD EXPENSES AT RS.1,20,000 / - WHICH IS DULY COVERED BY THE CASH WITHDRAWALS MADE BY THE APPELLANT IT A NO S . 4950 /DEL /201 1 4 AND NOT RE - DEPOSITED IN THE BANK. THE ADDITION OF RS.43,000 / - OR PROPOSED AMOUNT OF RS.46,000 / - IS THEREFORE NOT CALLED FOR. 2. THAT IN REGARD TO CASH DEPOSITED BY THE APPELLANT WITH THE COMPANY, THE SAID AMOUNT HAS CLEARLY COME OUT OF THE CASH IN HAND AVAILABLE WITH THE APPE LLANT AS PER A COPY OF THE BALANCE - SHEET ENCLOSED HEREWITH FOR THE ASSESSMENT YEAR IN APPEAL WHICH IS ALREADY ON RECORD AND THE IMMEDIATE PRECEDING ASSESSMENT YEAR. NO ADDITION IS THEREFORE CALLED FOR. ' 2.5. THE ABOVE SUBMISSION OF THE APPELLANT IS TO BE TAKEN INTO ACCOUNT AFTER CONSIDERING THE FACT THAT THE TOTAL INCOME OF THE APPELLANT WAS O NLY RS.19,20,890/ - . FROM THIS INCOME OF RS.19,20,890 / - , THE APPELLANT HAS MADE AN INVESTMENT OF R S .20,10,000 / - IN MUTUAL FUNDS AND LIFE INSURANCE (RS.5,00,000 / - EAC H IN TATA, RELIANCE AND KOTAK MAHINDRA AND RS.5,10,000 / - IN AVIVA LIFE INSURANCE). THE APPELLANT HAS NOT FILED ANY CASH FLOW STATEMENT EITHER BEFORE ME OR THE A O . IN THE ENHANCEMENT NOTICE I HAVE CLEARLY INDICATED THAT THE APPELLANT'S WITHDRAWAL AFTER 01.1 0.2007 WAS ONLY RS.14,000 / - MADE ON 30.12.2007. INSTEAD OF, EXPLAINING THE SOURCE OF HOUSE HOLD EXPENSES FOR THE PERIOD BETWEEN 01.10.2007 TO 31.03.2008, THE APPELLANT IS ONLY STATING THAT THE OVERALL DRAWINGS DURING THE YEAR IS ADEQUATE TO EXPLAIN THE HOU SE H OLD EXPENSES ESTIMATED BY THE AO AT R S .1,20,000 / - . THE BALANCE SHEET NOW FILED BY THE APPELLANT CAN ONLY BE TREATED AS SELF GENERATED EVIDENCE AS THE ASSESSMENT RECORDS INDICATES THAT NO BALANCE SHEET OR P&L WAS FILED ALONGWITH THE RETURN OF INCOME AS THE APPELLANT HAD ONLY SALARY INCOME AND ONLY A MEAGER INTEREST INCOME OF R S .889/ - . IN LIGHT OF THE ABOVE FINDINGS, THE VARIOUS GROUNDS OF APPEAL RAISED BY THE APPELLANT ARE CONSIDERED IN THE PARAGRAPHS BELOW. A PERSON HAVING RS.6,95,200/ - IN CASH AT TH E BEGINNING OF THE YEAR NEED NOT WITHDRAW SUCH SMALL AMOUNTS FROM HIS PERSONAL AMOUNT TO MAKE DEPOSITS IN THE BANK ACCOUNT. THEREFORE, THE APPELLANT S AR S EXPLANATION IS ONLY AN AFTER THOUGHT AND THEREFORE, REJECTED AND THE APPELLANT S INCOME IS ENHANCED WITH RS.6,20,000/ - U/S 69C OF THE ACT FOR UNEXPLAINED EXPENDITURE AS PROPOSED IN MY NOTICE U/S 251(2) DATED 04.07.2011. THEREFORE, THE TOTAL ENHANCEMENT OF RS.6,23,000/ - IS MADE INCLUDING RS.3,000/ - ENHANCED AS PER PARA 3.1. ABOVE. IT A NO S . 4950 /DEL /201 1 5 4. AS REGARDS THE ADDI TION OF RS.43,000/ - LD. CIT(A) HELD THAT THE TOTAL ESTIMATED HOUSEHOLD EXPENDITURE FOR SIX MONTHS AT THE RATE OF RS.10,000/ - PER MONTH COMES TO RS.60,000/ - OUT OF WHICH 14,000/ - IS MET OUT OF WITHDRAWALS OF THE MONEY AND THE BALANCE OF RS.46,000/ - WAS TRE ATED AS UNEXPLAINED EXPENDITURE THEREBY ENHANCING THE HOUSEHOLD EXPENDITURE BY RS.3000/ - . 5 . WE FIND THAT THE LD. C IT(A) PASSED VERY SPEAKING AND REASONED ORDER IN SUPPORT OF THE ENHANCEMENT OF RS.6,23,000/ - . HENCE, WE DO NOT FIND ANY REASON TO INTERFERE WITH THE ORDER OF THE CIT(A). THE APPEAL FILED BY THE ASSESSEE IS DISMISSED. 6 . IN THE RESULT , THE APPEAL FILED BY THE ASSESSEE IS DISMISSED. TH E ORDER PRONOUNCED IN THE OPEN COURT ON 2 4 TH APRIL , 201 5 . SD/ - SD/ - ( G.C. GUPTA ) ( I NTURI RAMA RAO ) V ICE PRESIDENT ACCOUNTANT MEMBER DATED: 2 4 TH APRIL , 201 5 . AKS/ - DC OM COPY FORWARDED TO 1 . APPELLANT 2 . RESPONDENT 3 . CIT 4 . CIT(A) 5 . DR ASST . REGISTRAR, ITAT, NEW DELHI