SHEHBAZ M. CHUNAWALA, MUMBAI V. ITO 16(2)(1), MUMBAI

ITA 5086/MUM/2011

• Counselvise Citation: 508619914 RSA 2011
• Duration Of Justice: 3 year(s) 2 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-09-2014
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: E
• Next Hearing Date: 18-09-2014
• Assessment Year: 2003-2004
• Appeal Filed On: 30-06-2011
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: VIJAY KUMAR BORA
• Assessee Lawyers: JAYANT R BHAT
• Keywords: Unexplained cash credit; Principle of natural justice
• Section: 68

Judgement Text

, , , , , IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES E, MUMBAI .., ! , ' , # BEFORE SHRI I.P.BANSAL, JM AND SHRI RAJENDRA, AM ITA NO.5086 /MUM/2011 (A.Y. 2003-04) MR.SHEHBAZ M. CHUNAWALA, 3-B/6 & 7, LOHIA NAGAR, 306,LBS MARG, KURLA (W), MUMBAI 400070 PAN:AAAPC 9419M THE ITO 16(2)(1), MUMBAI. ( $% / // / APPELLANT) ' ' ' ' / VS. ( ()$%/ RESPONDENT) $% * + * + * + * + /APPELLANT BY :SHRI JAYANT R. BHAT ()$% * + * + * + * + /RESPONDENT BY : SHRI VIJAY KUMAR BORA ' * ,-' / / / / DATE OF HEARING : 18.09.2014 ./0 * ,-' / DATE OF PRONOUNCEMENT : 18.09.2014 1 1 1 1 / / / / O R D E R PER I.P.BANSAL (JM) : THIS APPEAL IS FILED BY THE ASSESSEE AND IT IS DIRE CTED AGAINST THE ORDER PASSED BY LD. CIT(A)-28 , MUMBAI DATED 29/3/2011 FO R ASSESSMENT YEAR 2003-04. GROUNDS OF APPEAL READ AS UNDER: 1. THE HONBLE COMMISSIONER OF INCOME TAX (APPEAL) HAS ERRED IN CONFIRMING THE AMOUNT OF RS.5,00,000/- AS INCOME OF THE FINANC IAL YEAR 2002-2003 U/S 68 OF THE ACT. 2. THE HONBLE COMMISSIONER OF INCOME TAX (APPEAL) HAS ERRED IN CONFIRMING THE CONCLUSION OF A.O. THAT THE SALES PROCEEDS OF T HE FLAT OF RS. 90,000/- WERE UNEXPLAINED CASH CREDIT U/S 68 OF THE INCOME T AX ACT. 3. THE HONBLE COMMISSIONER OF INCOME TAX (APPEAL) HAS ERRED IN CONFIRMING THE CONCLUSION THAT THE CASH DEPOSITED OF RS. 50,00 0/- OUT OF PAST SAVINGS WAS AN UNEXPLAINED CASH CREDIT U/S 68 OF THE INCOME TAX ACT. 4. REASON ASSIGNED BY THE HONBLE COMMISSIONER OF I NCOME TAX (APPEALS) IN MAKING THE ABOVE ADDITIONS ARE WRONG, CONTRARY TO T HE PROVISIONS OF LAW & AGAINST IN THE NATURAL JUSTICE. ITA NO.5086 /MUM/2011 (A.Y. 2003-04 ) 2 5. THE APPELLANT PRAYS TO DELETE THE ENTIRE ADDITIO NS OF RS. 6,40,000/- WHICH IS NOT IN ACCORDANCE WITH LAW. 6. THE APPELLANT PRAYS TO KEEP THE DEMAND IN ABEYAN CE TILL THE DISPOSAL OF THE APPEAL. 2. THE ASSESSEE IS PROPRIETOR OF M/S. FORTUNE-8 AD VERTISING. DURING THE ASSESSMENT PROCEEDINGS THE AO FOUND THAT A SUM OF R S.5.00 LACS WAS CREDITED IN THE CAPITAL ACCOUNT OF THE ASSESSEE WHICH WAS SHOWN AS TRANSFERRED (OUT OF INDIA) INCOME EARNED AS NIR IN EARLIER YEARS. THE ASS ESSEE WAS REQUIRED TO PROVE THE CLAIM THAT RS.5.00 LACS WAS EARNED OUTSIDE INDIA AS NRI. VIDE LETTER DATED 12/1/2006 IT WAS SUBMITTED THAT THE ASSESSEE WAS W ORKING IN DUBAI FROM 1991. IN 1997 THE ASSESSEE WAS WORKING WITH M/S. FITRA IN TERNATIONAL FZE AND INITIALLY HIS SALARY WAS 5,000 DIRHAMS PER MONTH AND THE SA ME WAS INCREASE TO 9250 DURHAM PER MONTH BY JANUARY 2000. THE SALARY WAS BE ING CREDITED TO HIS BANK ACCOUNT IN DUBAI. THE SAID BANK ACCOUNT WAS CLOSED WHEN THE ASSESSEE CAME BACK TO INDIA IN APRIL, 2000. THERE WAS A BALANCE OF 80,000 DURHAM IN THE ACCOUNT AND THE SAME WAS WITHDRAWN IN CASH AND WAS LEFT IN DUBAI. OUT OF 80,000 DIRHAMS THE ASSESSEE TRANSFERRED RS.3.00 LA CS AND RS.2.00 LACS IN AUG. 2002 AND SEPTEMBER 2002 TO INDIA BY BANK DEMAND DRA FTS. IT WAS SUBMITTED THAT THE SAID AMOUNT WAS EARNED BY THE ASSESSEE DURING HIS TEN YEARS OF EMPLOYMENT IN DUBAI FROM JULY 1991 TO MARCH, 2000. IN PROOF THE ASSESSEE FILED SALARY SLIPS FOR THE MONTH OF JANUARY 2000 ISSUED BY M/S.FITRA I NTERNATIONAL FZE AND ALSO THE COPY OF PASSPORT. THEREAFTER, VIDE LETTER DATE D 27/1/2006 THE DETAILS OF PERIOD OF ASSESSEES STAY OUTSIDE INDIA WAS ALSO FURNISHED . FROM THE DETAILS THE AO NOTICED THAT THE ASSESSEE WAS OUT OF INDIA DURING T HE PERIOD FROM 30/07/2002 TO 26/10/2002 AND FROM 19/3/2003 TO 17/6/2003. THE AS SESSEE ALSO FILED A LETTER DATED 6/2/2006 ISSUED BY STANDARD CHARTERED BANK, WHEREIN IT WAS STATED THAT THE ASSESSEE HAS AN ACCOUNT WITH THEM AND UPON RE QUEST OF THE ASSESSEE FOREIGN INWARD CERTIFICATES WERE ISSUED TO HIM FOR THE CHEQUES OF RS.3.00 LACS AND RS.2.00 LACS DEPOSITED IN THE SAID ACCOUNT ON 24/8/ 2002 AND 17/9/2002 RESPECTIVELY. IN VIEW OF ALL THESE EVIDENCES IT WAS SUBMITTED THAT THE AMOUNT OF RS.5.00 LACS SHOULD NOT BE CONSIDERED TO BE UNEXPLA INED. THE A.O REJECTED SUCH CLAIM OF THE ASSESSEE AND ADDED THE SAID AMOUNT TO THE INCOME OF THE ASSESSEE. ITA NO.5086 /MUM/2011 (A.Y. 2003-04 ) 3 3. BEFORE LD. CIT(A) APART FROM THE AFOREMENTIONED EVIDENCE THE ASSESSEE SUBMITTED THAT DURING HIS STAY IN UAE THE ASSESSEE HAD ADVANCED 80,000 DIRHAMS TO ONE MR. MOIZ DHOLAKWALA FROM WHOM HE HAS RECEIVED THE AFOREMENTIONED AMOUNT OF RS.5.00 LACS BACK AND TO S UPPORT SUCH CONTENTION THE ASSESSEE FILED A CERTIFICATE, THE COPY OF WHICH IS PLACED AT PAGE-4 OF THE PAPER BOOK, IN WHICH THE FOLLOWING CERTIFICATE WAS GIVEN. TO WHOMESOVER IT MAY CONCERN I, MOIZ DHOLKAWALA, RESIDING AT DUBAI, UAE, HEREBY STATE AS FOLLOWS 1) IN AND AROUND THE YEAR APRIL 2000, I WAS RESIDIN G IN DUBAI AND WAS IN URGENT NEED OF FUNDS FOR BUSINESS. 2) AT THAT TIME, MY CLOSE FRIEND AND ASSOCIATE MR. SHEHBAZ CHUNAWALA HAD LEFT HIS SERVICES WITH FITRA INTERNATIONAL AND WAS LEAVING F OR MUMBAI. 3) I REQUESTED HIM FOR AN URGENT LOAN OF 60000 DIRH AMS WHICH HE GAVE ME IN CASH BY WITHDRAWING FROM HIS BANK ACCOUNT; 4) AFTER HE LEFT FOR INDIA, I UTILISED MY MONEY FOR AN URGENT NEED AS STATED ABOVE. 5) MR. SHEHBAZ CHUNAWALA REMINDED ME FROM TIME TO T IME FOR REPAYMENT OF LOAN REQUESTING ME TO REMIT THE MONEY TO HIM IN INDIA. 6) UNFORTUNATELY, ON ACCOUNT OF CIRCUMSTANCES BEYON D MY CONTROL, I COULD NOT MAKE THE REMITTANCE. 7) FINALLY IN AND AROUND AUGUST 2002, MR. SHEHBAZ C HUNAWALA HAD COME TO DUBAI AND PRESSED ME FOR VERY HARD FOR REPAYMENT OF LOAN. 8) I MANAGED TO PAY HIM AN AMOUNT EQUIVALENT TO RS. 3 LACS (INDIAN RUPEES) AND IN SEPTEMBER 2002 I PAID HIM FURTHER MONEY EQUIVALENT TO INDIAN RUPEES 2 LACS. THIS CLEARED MY LIABILITY TO HIM. 9) SINCE THE FUNDS WERE URGENTLY NEEDED BY MR. SHEH BAZ CHUNAWALA, I PAID THE AMOUNT TO HIM IN CASH INSTEAD ON MAKING THE REMITTA NCE WHICH WOULD HAVE TAKEN LONGER TIME FOR REALISATION. I AM INFORMED THAT MR. SHEHBAZ CHUNAWALA HAS BEEN R EQUIRED TO GIVE AN EXPLANATION OF THE AMOUNT OF RS.5 LACS CREDITED TO HIS ACCOUNT IN INDIA AND I HAVE NARRATED THE FACTS ABOVE SO THAT THE MATTER IS CLEA R TO THE AUTHORITIES CONCERNED. SIGNED AT DUBAI, THIS 19TH DAY OF NOVEMBER 2006. 3.1 ALONGWITH AFOREMENTIONED CERTIFICATE COPY OF PA SSPORT OF MR. MOIZ DHOLAKWALA WAS ALSO FILED. LD. CIT(A) FORWARDED TH ESE EVIDENCES TO THE AO AND ITA NO.5086 /MUM/2011 (A.Y. 2003-04 ) 4 SOUGHT FOR THE REMAND REPORT. THE AO HAS SUBMITTED THE REMAND REPORT WHICH IS REPRODUCED IN PARA 3.1 OF THE CIT(A)S ORDER. FIRS TLY, THE AO OBJECTED TO ADMISSION OF THE SAID EVIDENCES. HOWEVER, THE AO REJECTED TH E CONTENTION OF THE ASSESSEE AS PER FOLLOWING OBSERVATION: 1. THE ASSESSEE HAS BEEN WORKING IN UAE DURING TH E PERIOD FROM JULY 1991 TO MARCH 2000. IN THE CIRCUMSTANCES, WHEN THE ASSESSE E HAS WOULD UP HIS AFFAIRS IN UAE, ON TOTAL TRANSFER OF RESIDENCE, WHICH REASONAB LE MAN OF ORDINARY PRUDENCE WOULD LEND MONEY TO A PURPORTED FRIEND AN AMOUNT E QUIVALENT TO RS.5,00,000/-. 2. GENERALLY, AT THE TIME OF TRANSFER OF RESIDENCE, IT IS QUITE NORMAL THAT PEOPLE WITHDRAW CASH AND BUT ARTICULATES ( WHICH ARE QUITE CHEAP IN UAE) AND BRING HOME THE SAME AS THE ARTICLES BROUGHT BY THE INDIVIDUAL ON TRANSFER OF RESIDENCE ARE PRACTICALLY EXEMPT FROM CUSTOMS DUTY OR PAYING LEAS T CUSTOMS DUTY. 3. IT IS ALSO QUITE NORMAL FOR THE PEOPLE TO BRING ARTICLES WHENEVER THEY VISIT THEIR HOUSE IN INDIA. THUS, HEAVY WITHDRAWALS FROM BANK ARE QUITE NORMAL DURING THEIR RETURN BACK TO INDIA. 4. THUS, ON SUCH OCCASION NO BODY WILL GIVE CASH L OAN TO ANY OTHER PERSON IN A COUNTRY WHICH THEY ARE LEAVING. FURTHER, EVEN IN E XTREME CASES ANY PERSON WILL ONLY GIVE LOAN BY CHEQUE SO THAT HE HAS SOME PROOF BY WA Y OF ENTRY IN THE BANK ACCOUNT. 5. IF THE ASSESSEE HAS RETAINED ANY SUM ABROAD, WHY HE HAS NOT INFORMED THE RESERVE BANK OF INDIA. THE ASSESSEE HAS NOT PRODUC ED ANY EVIDENCE OF THIS VITAL NATURE. 6. WHY WILL ANY PERSON (DEBTOR) WHO IS RETURNING TH E LOAN WILL REPAY MONEY IN INDIA RUPEE WHEN THE DEBTOR IS WORKING IN UAE AND EARNS I NCOME IN DIRHUMS. 7. IT IS NOT CLEAR WHETHER MR. DHOLAKWALA CAME TO INDIA TWICE (I.E. IN AUGUST 2002 AND SEPT. 2002) IN SUCH A SHORT SPAN TO RETURN/REPA Y THE LOAN BY TAKING BANK DRAFT BY DEPOSITING CASH. WHY HE HAS NOT REPAID BY CHEQ UE BY A CHEQUE DRAWN ON FOREIGN CURRENCY I.E. DIRHAMS WHICH IS QUITE NORMAL . THE ABOVE MATERIAL FACTS TO PROVE THE EQUINITY OF G IVING LOAN AND REPAYMENT OF LOAN HAVE NOT BEEN ADDRESSED BY THE ASSESSEE ANYWHERE. THE ABOVE SUBMISSION MAY KINDLY BE CONSIDERED BY YO UR HONOUR WHILE PASSING THE APPELLATE ORDER. 3.2 RELYING UPON AFOREMENTIONED REMAND REPORT LD. CIT(A) HAS OBSERVED THAT TIME AND AGAIN OPPORTUNITIES WERE GIVEN TO THE ASSE SSEE BUT THE ASSESSEE HAS FAILED TO PRODUCE SUFFICIENT EVIDENCE EXCEPT CONFIR MATION FROM MR. MOIZ DHOLAKWALA. THE VERACITY OF STATEMENT OF MR. MOIZ DHOLAKWALA AND THE CIRCUMSTANCES IN WHICH THE AMOUNT OF RS.5.00 LACS W AS ALLEGEDLY CLAIMED TO BE GIVEN TO AN UNKNOWN PERSON WHILE LIVING IN DUBAI W HEN THE ASSESSEE WAS GOING TO INDIA FOR PERMANENT SETTLEMENT, WAS NOT ESTABLIS HED. THERE WAS NO PERMISSION ITA NO.5086 /MUM/2011 (A.Y. 2003-04 ) 5 TAKEN FROM RESERVE BANK OF INDIA FOR THE TRANSFER O F FOREIGN EXCHANGE AND IN VIEW OF ALL THESE FACTS LD. CIT(A) HAS HELD THAT THE AMO UNT OF RS.5.00 LACS DEPOSITED BY THE ASSESSEE IN STANDARD CHARTERED BANK CANNOT BE C ONSIDERED TO BE EXPLAINED, ACCORDINGLY, LD.CIT(A) HAS UPHELD THE ADDITION. 4. AFTER NARRATING THE FACTS IT WAS SUBMITTED BY L D. AR THAT THE ADDITION OF RS.5.00 LACS HAS WRONGLY BEEN CONFIRMED BY LD. CIT( A). HE SUBMITTED THAT THE ASSESSEE IS A MAN OF MEAN AND IT WAS SHOWN THROUGH DOCUMENTARY EVIDENCE THAT FOR ALMOST 10 YEARS THE ASSESSEE WAS WORKING IN DUB AI AND ABOUT 80,000 DIRHAMS WERE LYING IN HIS BANK ACCOUNT WHEN HE LEFT DUBAI. HE SUBMITTED THAT THE ASSESSEE HAD GIVEN 80,000 DIRHAMS TO MR. MOIZ DHOLAKWALA AND HE HAS ALSO CONFIRMED THE SAME. HIS COPY OF PASSPORT WAS ALSO FILED ALONGWITH COPY OF PASSPORT OF THE ASSESSEE. IT WAS SHOWN THAT ASSESS EE HAD VISITED AGAIN TO UAE TO RECEIVE BACK HIS AMOUNT WHICH WAS GIVEN BY MR. MOI Z DHOLAKWALA AND THE AMOUNT WAS DIRECTLY CREDITED TO STANDARD CHARTERED BANK. THUS IT WAS SUBMITTED THAT THE AMOUNT OF RS.5.00 LACS CANNOT BE CONSIDERE D TO BE UNEXPLAINED. REFERENCE WAS ALSO MADE TO THE COPIES OF THE FOLLO WING DOCUMENTS WHICH ARE FILED IN THE PAPER BOOK. 1. CERTIFICATE OF MR. MOIZ DHOLAKWALA ALONGWITH CO PY OF HIS PASSPORT AT PAGE 4 TO 6 OF THE PAPER BOOK. 2. COPY OF CERTIFICATE OF STANDARD CHARTERED BANK AT PAGE 7 OF THE PAPER BOOK. 3. COPY OF FOREIGN EXCHANGE REMITTANCE OF RS.2.00 LACS AT PAGE 8 OF PAPER BOOK. 4. COPY OF REMITTANCE OF FOREIGN EXCHANGE OF RS.3 .00 LACS AT PAGE 9 OF THE PAPER BOOK. 5. COPY OF PASSPORT OF THE ASSESSEE AT PAGES 10 T O 12 OF THE PAPER BOOK. 6.. COPY OF BANK ACCOUNT OF THE ASSESSEE IN UAE AT PAGES 13 TO 15 OF THE PAPER BOOK - IT MAY BE MENTIONED HERE THAT IN APRI L 2000 THE ASSESSEE HAS DRAWAN74,621.90 DIRHAMS FROM EMIRATE BANK AS PER C OPY PLACED AT PAGE 5 OF THE PAPER BOOK. 7.. CERTIFICATE GIVEN BY M/S.FITRA INTERNATIONAL F ZE STATING THAT DURING THE PERIOD 26/1/1997 TO 31/3/2000 THE ASSESSEE WAS DRAW ING TOTAL SALARY WITH ALLOWANCES AT A SUM OF 9250 DIRHAMS PER MONTH WHIC H WAS TRANSFERRED TO EMIRATE BANK INTERNATIONAL, DUBAI. ITA NO.5086 /MUM/2011 (A.Y. 2003-04 ) 6 5. ON THE OTHER HAND, LD. DR RELIED UPON THE ORDER PASSED BY AO AND LD. CIT(A). HE SUBMITTED THAT ASSESSEE COULD NOT PROVE THE GENUINENESS OF THE CASH CREDIT IN THE CAPITAL ACCOUNT , THEREFORE, LD. CIT (A) HAS RIGHTLY UPHELD THE ADDITION AND HIS ORDER SHOULD BE UPHELD. 6. WE HAVE HEARD BOTH THE PARTIES AND THEIR CONTENT IONS HAVE CAREFULLY BEEN CONSIDERED. FROM THE FACTS OF THE CASE AND EVIDENC ES PLACED ON RECORD, IT CANNOT BE SAID THAT ASSESSEE WAS NOT IN A CAPACITY TO SHOW THAT CREDIT TO HIS CAPITAL ACCOUNT OF RS.5.00 LACS COULD NOT BE MADE BY HIM. RATHER THE IMMEDIATE SOURCE OF THE DEPOSIT IS FOREIGN EXCHANGE REMITTANCE DIREC TLY CREDITED TO THE BANK ACCOUNT OF THE ASSESSEE. ALL THE RELEVANT EVIDENCES HAVE B EEN FILED BY THE ASSESSEE TO SHOW THAT THE IMMEDIATE SOURCE OF RECEIPT IS FOREIGN EX CHANGE REMITTANCE. THE ASSESSEE HAS SHOWN THE CAPACITY OF POSSESSING THAT AMOUNT AS THE ASSESSEE WAS WORKING IN DUBAI FOR ALMOST 10 YEARS AND HIS EMPLOY MENT IN DUBAI IS SUPPORTED BY CERTIFICATE OF THE EMPLOYER AND DEPOSIT OF SALA RY IN THE BANK ACCOUNT. THEREFORE, THE CONTENTION OF THE ASSESSEE CANNOT B E DISBELIEVED THAT HE WAS HAVING MONEY TO THE EXTENT IT HAS BEEN CREDITED TO HIS BANK ACCOUNT AND THEN TO THE CAPITAL ACCOUNT OF THE ASSESSEE. IN VIEW OF TH E EVIDENCES FILED BY THE ASSESSEE BEFORE AO AND LD. CIT(A), WE ARE OF THE OPINION TH AT UPHOLDING OF THE ADDITION WAS NOT JUSTIFIED. THE SAME IS DELETED AND GROUND NO.1 IS ALLOWED. 7. APROPOS GROUND NO.2, A SUM OF RS.90,000/- WAS AL SO CREDITED TO THE CAPITAL ACCOUNT OF THE ASSESSEE AS SALE OF FLAT AT MUMBRA (PURCHASED BY FATHER IN 1989) THE ASSESSEE WAS REQUIRED TO FILE THE PROOF OF PURC HASE AND SALE OF THE SAID FLAT. VIDE LETTER DATED 12/1/2002 IT WAS SUBMITTED THAT T HE FLAT AT MUMBRA WAS PURCHASED IN 1988 FOR RS.80,000/-. A COPY OF AGREE MENT DATED 8/9/1988 WAS FILED, ACCORDING TO WHICH THE FLAT WAS PURCHASED FO R RS.80,000/-. HOWEVER, THE ASSESSEE DID NOT FILE COPY OF SALE AGREEMENT. IT W AS SUBMITTED BY ASSESSEE THAT ASSESSEE IS NOT ABLE TO TRACE THE AGREEMENT FOR SAL E. IT IS, THEREFORE, THE AO DISALLOWED THE CLAIM OF THE ASSESSEE THAT A SUM OF RS.90,000/- PERTAIN TO THE SAID FLAT. LD. CIT(A) HAS CONFIRMED THE ADDITION. THE ASSESSEE AGGRIEVED, HENCE, HAS FILED GROUND NO.2. ITA NO.5086 /MUM/2011 (A.Y. 2003-04 ) 7 8. LD. AR SUBMITTED THAT THE ASSESSEE COULD NOT TRA CE COPY OF THE SALE AGREEMENT. THE COPY OF THE PURCHASE AGREEMENT IS FILED AT PAGES 17 TO 27 OF THE PAPER BOOK AND AT PAGE 28 THE ASSESSEE HAS FILED CO PY OF POSSESSION LETTER IN RESPECT OF THE SAID FLAT ACCORDING TO WHICH POSSESS ION WAS GIVEN TO MRS. MUMTAZ BANO DAUGHTER OF MR. MOHAMMAD CHUNAWALA .MRS. MOMIN BAI WIFE OF MR. MOHAMMAD CHUNAWALA. THE SAID LETTER IS DATED 6/3/2 003. THE CONTENT OF THE SAID LETTER ARE AS UNDER: FROM (1) MRS. MUMTAZ BANO D/O. MOHD. CHUNAWALA (KHAKYA) (2) MRS. MOMINBAI W/O. MOHD. CHUNAWALA (KHAKYA) 40, BAPU KHOTE STREET, 1 ST FLOOR, MUMBAI NO.400003 DATED: 6 TH MARCH, 2003 TO SHEHBAZ CUNAWALA, 93- BEACH VIEW, WARDEN ROAD, MUMBAI NO.400 026. RESPECTED SIR, SUB: POS SESSION LETTER. WITH REFERENCE TO THE AGREEMENT DATED 6 TH MARCH, 2003 MADE BETWEEN US ACCORDING TO THAT TODAY WE HAVE RECEIVED A PEACEFUL AND VACANT POSSESSION OF YOUR FLAT NO.402, 4 TH FLOOR, BODG. NO.B1, LAYING ON THE PLOT BEARING SUR VEY NO.70, HISSA NO.1 (PART) CHISTIYANAGAR, OPPOSITE AMRUT NAGAR, MU MBRA, DIST. THANE. WE HAVE RECEIVED THE ORIGINAL AGREEMENT COPY OF YOUR FLAT B ETWEEN THE BUILDER AND YOU DATED 8 TH SEPTEMBER, 1988. WE HAVE ALSO RECEIVED THE ZEROX OF THE T.M.C TAX C OPY AND THE MAINTENANCE RECEIPT OF THE HOUSING SOCIETY. NOW WE UNDERTAKE A LL THE RESPONSIBILITY OF THE FLAT FROM 1 ST MARCH, 2003. THANKING YOU, 1) MUMTAZ MOHD CUNAWALA SD/- THUS, IT WAS SUBMITTED BY LD. AR THAT THE SUM OF RS .90,000/- CREDITED TO THE ACCOUNT OF THE ASSESSEE SHOULD BE ACCEPTED. ITA NO.5086 /MUM/2011 (A.Y. 2003-04 ) 8 9. ON THE OTHER HAND, LD. DR RELIED UPON THE ORDER PASSED BY AO AND LD. CIT(A). 10. WE HAVE HEARD BOTH THE PARTIES AND THEIR CONTEN TIONS HAVE CAREFULLY CONSIDERED. THE ADDRESS OF THE PERSON TO WHOM THE POSSESSION WAS GIVEN HAD BEEN SUPPLIED TO THE AO BY WAY OF POSSESSION LETTE R AND IN THE SUBMISSIONS MADE MOBILE NO. WAS ALSO GIVEN. THE CONSIDERATION OF RS.90,000/- AS PER SUBMISSIONS OF THE ASSESSEE WAS RECEIVED BY CHEQUE NO.199361 ON 6/3/2003. IN VIEW OF THESE EVIDENCES IT CAN BE SAID THAT ASS ESSEE HAD SUBMITTED CERTAIN INFORMATION WHICH COULD BE VERIFIED BY THE AO AND THE CLAIM OF THE ASSESSEE SHOULD NOT HAVE BEEN REJECTED WITHOUT VERIFICATION. THEREFORE, WE ARE OF THE OPINION THAT THIS MATTER SHOULD BE RESTORED BACK TO THE FILE OF AO FOR MAKING VERIFICATION AND AO WILL RE-ADJUDICATE THIS ISSUE A FTER GIVING THE ASSESSEE A REASONABLE OPPORTUNITY OF HEARING. THUS, GROUND NO. 2 IS ALLOWED FOR STATISTICAL PURPOSES. 11. APROPOS GROUND NO.3, FROM THE CAPITAL ACCOUNTS SUBMITTED BY THE ASSESSEE IT WAS FOUND BY AO THAT A SUM OF RS.14,60,000/- WAS DEBITED TOWARDS PURCHASE OF FLAT NO.605A, KOHINOOR, ANDHERI (W). IT WAS ALS O NOTICED BY THE AO THAT A SUM OF RS.50,000/- WAS ALSO PAID ON ACCOUNT OF THE SAID FLAT ON 17/2/2003, THE SOURCE OF WHICH WAS STATED TO BE CASH DEPOSITED IN BANK AC COUNT, WHERE A SUM OF RS.20,000/- AND RS.30,000/- WAS DEPOSITED IN CASH O N 13/2/2003. THE ASSESSEE HAS NOT FURNISHED ANY EXPLANATION WITH REGARD TO TH E SAID AMOUNT OF RS.50,000/-. ACCORDINGLY, ADDITION OF RS.50,000/- WAS MADE. BEF ORE LD. CIT(A) IT WAS SUBMITTED THAT THE SAID DEPOSIT WAS MADE OUT OF CAS H IN HAND. HOWEVER, LD. CIT(A) DID NOT ACCEPT SUCH SUBMISSION OF THE ASSESS EE. HE CONFIRMED THE ADDITION ON ACCOUNT OF NON-FURNISHING OF COGENT EVIDENCE FOR SUCH DEPOSIT. 12. BEFORE US LD. AR SUBMITTED THAT ASSESSEE HAS N OTHING TO SAY EXCEPT WHAT IS PLEADED BEFORE AO AND LD. CIT(A). 13. ON THE OTHER HAND, LD. DR RELIED UPON THE ORDER PASSED BY AO AND LD. CIT(A). ITA NO.5086 /MUM/2011 (A.Y. 2003-04 ) 9 14. AFTER HEARING BOTH THE PARTIES, IN VIEW OF THE FACT THAT ASSESSEE COULD NOT SUBSTANTIATE THE CASH DEPOSITED IN THE BANK ACCOUNT WE HOLD THAT THE ADDITION HAS RIGHTLY BEEN UPHELD BY LD. CIT(A) AND WE DECLIN E TO INTERFERE. THIS GROUND OF ASSESSEE IS DISMISSED. 15. OTHER GROUNDS ARE ONLY SUPPORTING THE AFOREMENT IONED THREE GROUND AND THEY ARE NOT REQUIRED TO BE ADJUDICATED SEPARATELY. NO SEPARATE ARGUMENTS WERE ALSO SUBMITTED TO SUPPORT REST OF THE GROUNDS. 16. IN VIEW OF ABOVE DISCUSSIONS, THE APPEAL IS CO NSIDERED TO BE PARTLY ALLOWED FOR STATISTICAL PURPOSES IN THE MANNER AFORESAID. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 18.09. 2 014. 1 * ./0 2'3 18.09.2014 / * : SD/- SD/- ( ! /RAJENDRA) ( .. / I.P.BANSAL) ' ' ' ' / ACCOUNTANT MEMBER / JUDICIAL MEMBER MUMBAI; 2' DATED : 18 TH SEPT. 2014. VM. 1 * (,; < ;0, 1 * (,; < ;0, 1 * (,; < ;0, 1 * (,; < ;0,/ COPY OF THE ORDER FORWARDED TO : 1. $% / THE APPELLANT 2. ()$% / THE RESPONDENT. 3. =() / THE CIT, MUMBAI. 4. = / CIT(A)-13, MUMBAI 5. ;@: (,' , , / DR, ITAT, MUMBAI 6. :A B / GUARD FILE. 1' 1' 1' 1' / BY ORDER, );, (, //TRUE COPY// C CC C/ // /D D D D (DY./ASSTT. REGISTRAR) , , , , / ITAT, MUMBAI ITA NO.5086 /MUM/2011 (A.Y. 2003-04 ) 10 DATE INITIAL 1. DRAFT DICTATED ON 19.09.2014 SR.PS 2. DRAFT PLACED BEFORE AUTHOR 19.09.2014 SR.PS 3. DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER JM/AM 4. DRAFT DISCUSSED/APPROVED BY SECOND MEMBER. JM/AM 5. APPROVED DRAFT COMES TO THE SR.PS/PS SR.PS/PS 6. KEPT FOR PRONOUNCEMENT ON SR.PS 7. FILE SENT TO THE BENCH CLERK SR.PS 8. DATE ON WHICH FILE GOES TO THE AR 9. DATE ON WHICH FILE GOES TO THE HEAD CLERK. 10. DATE OF DISPATCH OF ORDER. 11. DRAFT DICTATION SHEETS ARE ATTACHED SR.PS