ITO WD 18(2)(3), MUMBAI V. NALLINI S. AGARWAL, MUMBAI

ITA 5061/MUM/2009

• Counselvise Citation: [2010] 136 COUNSELVISE.COM (IT) 1509 (ITAT-MUMBAI)
• Duration Of Justice: 9 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-06-2010
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2005-2006
• Appeal Filed On: 04-09-2009
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: VIKRAM GAUR
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES, B, MUMBAI BEFORE SHRI R V EASWAR, PRESIDENT AND SHRI J SUDHAKAR REDDY, ACCOUNTANT MEMBER I T A NO: 5061/MUM/2009 (ASSESSMENT YEAR: 2005-06) INCOME TAX OFFICER, WARD 18(2)(3), MUMBAI APPELL ANT VS SMT NALINI S AGARWAL, MUMBAI RESPONDENT (PAN: AABPA6804F) APPELLANT BY: SHRI VIKRAM GAUR RESPONDENT BY: SHRI S L JAIN O R D E R R V EASWAR, PRESIDENT: THIS IS AN APPEAL BY THE DEPARTMENT FOR THE ASSESS MENT YEAR 2005-06 AND THE ONLY GROUND TAKEN IS THAT THE CIT(A ) ERRED IN DELETING THE ADDITION OF THE CASH DEPOSIT OF RS.9,40,500/-. 2. THE ASSESSEE IS AN INDIVIDUAL. SHE DOES NOT CAR RY ON ANY BUSINESS AND THE INCOME DECLARED IN THE RETURN CONS ISTED OF PROPERTY INCOME AND CAPITAL GAINS. WHILE COMPLETING THE ASS ESSMENT UNDER SECTION 143(3) OF THE INCOME TAX ACT, 1961, THE ASS ESSING OFFICER NOTICED THAT THERE WERE CASH DEPOSITS IN THE BANK A CCOUNT. THE ASSESSEE EXPLAINED THAT THE DEPOSITS IN THE BANK AC COUNT WERE FROM THE CASH BALANCE AVAILABLE WITH HER OUT OF WITHDRAW ALS FROM THE BANK ITA NO: 5061/MUM/2009 2 FROM TIME TO TIME. IN AN ATTEMPT TO EXAMINE THE AS SESSEES EXPLANATION, THE ASSESSING OFFICER COLLECTED THE DE TAILS OF THE WITHDRAWALS AND DEPOSITS FROM APRIL 2004 TO MARCH 2 005 AND TRIED TO CO-RELATE THEM BUT STILL FOUND THAT THE DEPOSIT OF RS.11,15,500/- IN MARCH 2005 COULD NOT BE FULLY CO-RELATED TO THE EAR LIER WITHDRAWALS. THOUGH THERE WERE HEAVY WITHDRAWALS IN THE EARLIER MONTHS, IT WAS THE VIEW OF THE ASSESSING OFFICER THAT CASH IS WITHDRAW N NORMALLY FOR MEETING SPECIFIC AND IMMEDIATE REQUIREMENTS AND NOT HING WOULD THEREFORE BE AVAILABLE TO THE ASSESSEE FROM THOSE W ITHDRAWALS FOR BEING DEPOSITED BACK INTO THE ACCOUNT. HOWEVER, HE GAVE THE BENEFIT OF THE WITHDRAWALS OF RS.2,15,000/- MADE IN FEBRUAR Y 2005 AND ASSESSED THE BALANCE OF RS.9,40,500/- AS THE INCOME OF THE ASSESSEE FROM UNEXPLAINED SOURCES. 3. ON APPEAL, THE ASSESSEE CONTENDED THAT THE MERE TIME DIFFERENCE OF A FEW MONTHS CANNOT BE A VALID REASON FOR REJECTING THE ASSESSEES EXPLANATION. BEYOND THIS NO EVIDENCE WO ULD APPEAR TO HAVE BEEN ADDUCED, EXCEPT BRINGING CERTAIN AUTHORIT IES TO THE NOTICE OF THE CIT(A). THE CIT(A) MERELY REPRODUCED THE ASSES SEES ARGUMENTS AND THE EXTRACTS FROM THE AUTHORITIES AND IN PARAGR APH 6 OBSERVED AS UNDER: - 6. IN VIEW OF THE AFORESAID FACTS, ADDITION MADE B Y THE AO IS DELETED. 4. THE REVENUE IS IN APPEAL AND ITS MAIN CONTENTION WAS THAT THE CIT(A) HAS NOT PASSED A SPEAKING ORDER AND HAS NOT GIVEN ANY ITA NO: 5061/MUM/2009 3 REASONS FOR ACCEPTING THE ASSESSEES APPEAL. IT IS POINTED OUT THAT NO EVIDENCE HAS BEEN ADDUCED BY THE ASSESSEE TO SHOW T HAT SOME AMOUNT WAS LEFT WITH HER OUT OF THE WITHDRAWALS OF THE EARLIER MONTHS TO FACILITATE THE DEPOSIT IN THE BANK ACCOUNT IN MARCH 2005. OUR ATTENTION WAS ALSO DRAWN TO THE OBSERVATION OF THE ASSESSING OFFICER THAT NO CASH BOOK WAS PRODUCED BY THE ASSESSEE. ON THE OTH ER HAND, THE LEARNED REPRESENTATIVE FOR THE ASSESSEE SUBMITTED T HAT THE CIT(A) HAS RELIED ON SEVERAL AUTHORITIES TO ACCEPT THE ASSESSE ES CLAIM AND THAT THE ASSESSEE DID ADDUCE EVIDENCE BEFORE HIM. 5. ON A CAREFUL CONSIDERATION OF THE MATTER, WE ARE SATISFIED THAT THE REVENUES CONTENTION IS CORRECT. THE ASSESSEE DID NOT PRODUCE ANY CASH BOOK BEFORE THE ASSESSING OFFICER AND WOUL D APPEAR TO HAVE RELIED UPON THE GENERAL ARGUMENT THAT SOME CASH OUT OF THE EARLIER WITHDRAWALS WOULD BE AVAILABLE WITH HER. BEFORE TH E CIT(A) ALSO, EXCEPT PLACING RELIANCE ON CERTAIN ORDERS OF THE TR IBUNAL AND JUDGMENTS OF THE SUPREME COURT TO THE EFFECT THAT NO ADDITION CAN BE MADE ON THE BASIS OF SUSPICION AND CONJECTURES, THE ASSESSEE AD DUCED PRECIOUS LITTLE BY WAY OF EVIDENCE TO SHOW THAT SOME CASH OU T OF THE EARLIER WITHDRAWALS WAS AVAILABLE WITH HER TO ENABLE HER TO DEPOSIT IT IN THE BANK IN MARCH 2005. THE ASSESSEE, INSTEAD OF ADDUC ING ANY EVIDENCE HAD CONTENDED BEFORE THE CIT(A) THAT IT WAS FOR THE ASSESSING OFFICER TO BRING ON RECORD SOME EVIDENCE TO SHOW THAT THE C ASH WITHDRAWN EARLIER WAS SPENT BY THE ASSESSEE AND, THEREFORE, N OTHING WOULD BE AVAILABLE TO HER FOR BEING DEPOSITED IN MARCH 2005. THE ASSESSEES ITA NO: 5061/MUM/2009 4 ARGUMENTS HAVE BEEN ACCEPTED BY THE CIT(A) WITHOUT ANY FURTHER ENQUIRY INTO THE FACTUAL POSITION. THIS IS ESSENTI ALLY A MATTER OF FACT WHERE IT WAS THE DUTY OF THE ASSESSEE TO SHOW THAT SHE HAD SOME CASH LEFT OUT OF THE EARLIER WITHDRAWALS, PARTICULARLY W HEN SHE HAS CONTENDED BEFORE THE CIT(A) THAT SHE WAS MAINTAINING A PROFIT & LOSS ACCOUNT AND BALANCE SHEET. IF REALLY SHE WAS MAINTAINING A PROFIT & LOSS ACCOUNT AND BALANCE SHEET, SHE WOULD HAVE MAINTAINE D THE CASH BOOK ALSO WHICH SHE OUGHT TO HAVE PRODUCED BEFORE T HE ASSESSING OFFICER. FURTHER THE CONTENTION OF THE ASSESSEE TH AT IT WAS FOR THE ASSESSING OFFICER TO BRING EVIDENCE TO SHOW THAT TH E ASSESSEE WAS NOT LEFT WITH ANY CASH BALANCE OUT OF THE EARLIER WITHD RAWALS IS BEREFT OF MERIT. IT IS NOT FOR THE ASSESSING OFFICER TO POIN T OUT HOW THE ASSESSEE HAD SPENT THE MONEYS OUT OF THE EARLIER WITHDRAWALS . ON THE CONTRARY THE ONUS IS ON THE ASSESSEE, WHO HAS THE KNOWLEDGE OF THE FACTS AND WHO CLAIMS THAT CASH WAS LEFT FROM THE EARLIER WITH DRAWALS, TO SUPPORT THE CLAIM BY ADDUCING THE RELEVANT EVIDENCE SUCH AS HOW THE EARLIER WITHDRAWALS WERE SPENT, HOW MUCH WAS SPENT AND HOW MUCH WAS AVAILABLE FOR BEING RE-DEPOSITED INTO THE BANK ACCO UNT. THERE SHOULD HAVE BEEN NO DIFFICULTY IF A REGULAR CASH BOOK HAD BEEN MAINTAINED BY HER. THE CIT(A) OUGHT TO HAVE EXAMINED ALL THESE F ACTUAL ASPECTS AND HIS JUDGMENT HAS BEEN CLOUDED BY THE WRONG PLACING OF THE ONUS UPON THE ASSESSING OFFICER AND ALSO BECAUSE HE APPROACHE D THE CASE ONLY FROM A LEGAL ANGLE WITHOUT REFERENCE TO THE FACTS W HICH ARE CRUCIAL. HE HAS NOT GIVEN ANY REASONS FOR HIS DECISION AND HAS SIMPLY ACCEPTED ITA NO: 5061/MUM/2009 5 THE ASSESSEES LEGAL SUBMISSIONS WITHOUT ASKING THE ASSESSEE TO ADDUCE EVIDENCE. IN THE CIRCUMSTANCES WE SET ASIDE THE ORDER OF THE CIT(A) AND RESTORE THE APPEAL TO HIM FOR A FRESH DI SPOSAL IN ACCORDANCE WITH LAW. THE APPEAL OF THE DEPARTMENT IS THUS ALL OWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 18 TH JUNE 2010. SD/- SD/- (J SUDHAKAR REDDY) (R V EASWAR) ACCOUNTANT MEMBER PRESIDENT MUMBAI, DATED 18 TH JUNE 2010 SALDANHA COPY TO: 1. SMT NALINI S AGARWAL 632, ARUN CHAMBERS, NEAR A C MARKET TARDEO, MUMBAI 400 034 2. ITO, WARD 18(2)(3) 3. CIT-XVIII 4. CIT(A)-XVIII 5. DR B BENCH TRUE COPY BY ORDER ASSTT. REGISTRAR, ITAT, MUMBAI