ITO 21(2)(1), MUMBAI V. HARSHA D. DOSHI, MUMBAI

ITA 5088/MUM/2013

• Counselvise Citation: 508819914 RSA 2013
• Duration Of Justice: 2 year(s) 1 month(s) 6 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-08-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: H
• Next Hearing Date: 03-06-2015
• Assessment Year: 2009-2010
• Appeal Filed On: 08-07-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: RASHMIKANT C MOD I
• Keywords: Unexplained investment; Source of fund
• Section: 143(3)

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES H MUMBAI . . , , BEFORE SHRI G.S.PANNU, ACCOUNTANT MEMBER AND SHRI SANJAY GARG, JUDICIAL MEMBER . / ITA NO.5088/MUM/2013 / ASSESSMENT YEAR 2009-10 THE ITO 21(2)(1), 505, 5 TH FLOOR, C-10, PRATYAKSH KAR BHAVAN, BANDRA KURLA COMPLEX, BANDRA (E), MUMBAI 400051. / VS. SMT. HARSHA D. DOSHI, 701, DHARAMKRUPA, 7 TH FLOOR, CHUNABHATTI (W), MUMBAI -22. ./ ./ PAN/GIR NO. : AADPD 7173 L ( / APPELLANT ) .. ( / RESPONDENT ) APPELLANT BY SHRI SUNIL KUMAR SINGH RESPONDENT BY SHRI RASHMIKANT C. MODI ' #$ / DATE OF HEARING : 10/06/2015 ' #$ / DATE OF PRONOUNCEMENT : 14/08/2015 / O R D E R PER G.S.PANNU, A.M: THE PRESENT APPEAL IS PREFERRED BY THE REVENUE AND IS DIRECTED AGAINST THE IMPUGNED APPELLATE ORDER DATED 03/04/2013 PAS SED BY LD. CIT(A)-32, MUMBAI PERTAINING TO THE ASSESSMENT YEAR 2009-10, W ITH REFERENCE TO THE ASSESSMENT ORDER DATED 30/12/2011 PASSED BY THE A .O IN TERMS OF SECTION 143(3) OF THE INCOME TAX ACT, 1961(THE ACT). 2. IN THIS APPEAL THE GRIEVANCE OF THE REVENUE IS A GAINST THE ORDER OF CIT(A), WHEREIN ADDITION OF RS.34,80,000/- MADE BY THE ASS ESSING OFFICER ON ACCOUNT OF UNEXPLAINED INVESTMENT IN FDRS, HAS BEEN DELET ED. . / ITA NO.5088/MUM/2013 / ASSESSMENT YEAR 2009-10 2 3. BRIEFLY PUT, THE RELEVANT FACTS ARE THAT THE ASS ESSEE-INDIVIDUAL, DERIVES INCOME FROM HOUSE PROPERTY, BUSINESS, CAPITAL GAIN AND OTHER SOURCES. THE AO NOTICED THAT FDRS TO THE TUNE OF RS.34,80,000/- STOOD IN THE NAME OF MASTER SHUBHAM D. DOSHI, THE MINOR CHILD OF THE ASS ESSEE. THE EXPLANATION FURNISHED BY THE ASSESSEE WITH RESPECT TO THE SOUR CE OF INVESTMENT WAS NOT ACCEPTED BY THE AO ON THE GROUND THAT IT WAS NOT SU BSTANTIATED ON THE BASIS OF ANY DOCUMENTARY EVIDENCE. THEREFORE, THE VALUE OF INVESTMENT IN FDRS AMOUNTING TO RS.34,80,000/- WAS CONSIDERED AS UNP ROVED AND ADDED TO THE INCOME RETURNED BY THE ASSESSEE. 4. BEFORE CIT(A), ASSESSEE EXPLAINED THAT FDRS TO THE EXTENT OF RS. 14,30,000/- WAS MADE OUT OF CASH RECEIVED FROM HER MOTHER SMT . LEELABEN G.SHAH, WHEREAS FDRS TO THE EXTENT OF RS.20,50,000 /- WERE MADE OUT OF LOANS RECEIVED THROUGH CHEQUES FROM FOUR PERSONS NAMELY SMT. JAYABEN VASA, HITEN VASA, MOHIT VASA & MAITRI VASA. THE ASSESSEE EXPLA INED THAT CONFIRMATIONS FROM THE AFORESAID LOAN CREDITORS WERE FURNISHED BE FORE THE AO. WITH REGARD TO THE AMOUNT RECEIVED FROM THE MOTHER, ASSESSEE ALSO EXPLAINED THAT THE CASH RECEIVED WAS OUT OF THE SALE OF OLD JEWELLERY BY HER MOTHER, AND THE COPY OF THE BILL OF THE JEWELLER EVIDENCING SALE OF JEWE LLERY WAS ALSO FURNISHED. THE CIT(A) NOTICED THAT THE AO HAD NOT MADE ANY COMME NTS ON THE EVIDENCE AND MATERIAL STATED TO HAVE BEEN FURNISHED BEFORE HIM A ND, THEREFORE, HE CALLED FOR A REMAND REPORT FROM THE AO. IT IS SEEN THAT IN TH E COMMUNICATION CALLING FOR THE REMAND REPORT, THE AO WAS SPECIFICALLY DIRECTE D TO EXAMINE THE EVIDENCE AND MATERIAL RELIED UPON BY THE ASSESSEE AND ALSO T O CARRY OUT NECESSARY INVESTIGATIONS IN ORDER TO CHECK VERACITY OF THE CL AIM MADE BY THE ASSESSEE. THE CIT(A) HAS THEREAFTER, CONSIDERED THE REMAND RE PORT FURNISHED BY THE AO AND ALSO THE REPLIES OF THE ASSESSEE. ON THE BASI S OF THE AFORESAID, THE CIT(A) HAS DELETED THE ADDITION AND THE FOLLOWING DISCUSSI ON IN HIS ORDER IS RELEVANT:- . / ITA NO.5088/MUM/2013 / ASSESSMENT YEAR 2009-10 3 FROM THE PERUSAL OF THE REPLIES FILED, IT IS NOTED THAT LOAN CONFIRMATION WERE DULY FURNISHED BEFORE THE AO BUT THE SAME HAS REMAINED T O BE CONSIDERED IN THE ASSESSMENT ORDER WHILE ARRIVING AT THE CONCLUSION, THAT NO DOCUMENTARY EVIDENCE' WAS FURNISHED. ACCORDINGLY ALL THE LOAN CONFIRMATI ONS AS WELL AS SALE BILLS OF THE JEWELLERY FURNISHED BY ASSESSEE DURING APPELLATE PR OCEEDINGS WERE FORWARDED TO THE AO ALONGWITH THE DETAILED REPLY OF THE ASSESSEE CALLING FOR THE REMAND REPORT. IT IS ALSO NOTED THAT THE ASSESSEE DURING THE REMAN D PROCEEDINGS HAD SUBMITTED ALL THE EXPLANATIONS AND EVIDENCES TO EXPLAIN THE S OURCE OF CASH OF RS.14,30,000/- GIVEN BY SMT. LILABEN SHAH AS WELL A S THE LOANS RECEIVED FROM OTHER 4 PERSONS AMOUNTING TO RS. 20,50,000/- SUCH A S COPY OF THE PAN CARD, ACKNOWLEDGMENT OF THE RETURN ETC. ALONG WITH THE CO MPUTATION OF INCOME, BALANCE SHEET, BANK STATEMENT AND CONFIRMATIONS OF THE LOAN CREDITORS ALONG WITH THEIR ADDRESSES ETC. VIDE LETTER DATED 6.8.2012, 13.8.201 2. THUS IT IS CLEAR THAT WHATEVER DETAILS THE AO ASKED DURING THE REMAND PRO CEEDINGS, HAVE BEEN FURNISHED BY THE ASSESSEE TO THE AO. THOUGH, VIDE P ARA 4 OF THIS OFFICE LETTER DATED 12.7.2012 THE AO WAS SPECIFICALLY DIRECTED TO MAKE FURTHER ENQUIRIES TO CHECK THE VERACITY OF THE CLAIMS MADE BY THE ASSESS EE BUT NO ENQUIRY FROM THE THIRD PARTIES SUCH AS LOAN CREDITORS OR JEWELER HAS BEEN DONE BY THE AO. HE HAS SIMPLY SUPPORTED THE ADDITIONS MADE ON BASIS OF MER E SUSPICION WITHOUT BRINGING ANY MATERIAL ON RECORD TO REBUT THE EVIDENCES GIVEN BY ASSESSEE DURING THE REMAND PROCEEDINGS ALSO. AGAINST THE AFORESAID, REVENUE IS IN APPEAL BEFORE US. 5. LD. DR APPEARING FOR THE REVENUE HAS STATED THAT ASSESSEE WAS NOT ABLE TO PROVE THE GENUINENESS OF THE TRANSACTIONS WITH T HE CREDITORS EITHER AT THE TIME OF ASSESSMENT PROCEEDINGS OR EVEN IN THE REMAN D PROCEEDINGS AND, THEREFORE, CIT(A) ERRED IN DELETING THE ADDITION. 6. ON THE OTHER HAND, LD. REPRESENTATIVE FOR THE AS SESSEE HAS DEFENDED THE ORDER PASSED BY CIT(A) BY POINTING OUT THAT THE MAT ERIAL AND EVIDENCE BEFORE THE CIT(A) CLEARLY ESTABLISHED THAT SOURCE OF THE FDRS STOOD PROVED. 7. WE HAVE CAREFULLY CONSIDERED THE RIVAL SUBMISSIO NS. THE PERTINENT CONTROVERSY IN THE PRESENT APPEAL RELATES TO THE SO URCE OF FUNDS FOR THE FDRS MADE BY THE ASSESSEE IN THE NAME OF HER MINOR CHI LD MASTER SHUBHAM D. DOSHI AMOUNTING TO RS.34,80,000/-. OUT OF THE TO TAL AMOUNT, ASSESSEE EXPLAINED THAT RS.14,30,000/- WAS RECEIVED FROM HER MOTHER SMT. LEELABEN G. SHAH AND THE BALANCE OF RS.20,50,000/- WAS RECEIVE D FROM FOUR PERSONS. WITH . / ITA NO.5088/MUM/2013 / ASSESSMENT YEAR 2009-10 4 REGARD TO THE AMOUNT RECEIVED FROM HER MOTHER, A SSESSEE FURNISHED A LOAN CONFIRMATION AND ALSO EXPLAINED THAT THE AMOUNT BEC AME AVAILABLE WITH HER MOTHER ON ACCOUNT OF SALE OF JEWELLERY BY HER. THE DETAILS OF THE SALE OF JEWELLERY, NAMELY, INVOICE OF THE JEWELLERY SOLD, ETC. WERE ALSO FURNISHED. SECONDLY, WITH REGARD TO THE BALANCE AMOUNT OF RS.2 0,50,000/- AS LOANS RECEIVED FROM FOUR OTHER PERSONS, THE ASSESSEE NOT ONLY FILED THE CONFIRMATIONS BUT ALSO COPIES OF THE PAN CARD, ACKNOWLEDGEMENT OF RETURN OF INCOME, COMPUTATION OF INCOME, BALANCE SHEET, BANK STATEMEN T, ETC. OF THE LENDERS. THE AFORESAID MATERIAL WAS RELIED UPON BY THE ASSESSEE AND THE DISCUSSION BY THE CIT(A) REVEALS THAT THE SAME WAS PUT TO THE AO ALSO . THE CIT(A) FURTHER RECORDS A FINDING THAT THE AO HAS NOT MADE ANY ENQUIRIES I N THE CONTEXT OF THE MATERIAL AND EVIDENCE RELIED UPON BY THE ASSESSEE B UT MERELY REJECTED THE SAME ON SURMISES AND SUSPICION. 8. IN THIS BACKGROUND OF THE MATTER, WE FIND NO ERR OR ON THE PART OF THE CIT(A) IN ACCEPTING THE EXPLANATION OF THE ASSESSEE TOWARDS THE SOURCE OF FUNDS FOR MAKING OF FDRS OF RS.34,80,000/-. QUITE CLEARLY, THE FINDINGS OF THE CIT(A), WHICH WE HAVE EXTRACTED ABOVE ARE UNEXCEPT IONAL AND THERE IS NO COGENT MATERIAL OR EVIDENCE WITH THE REVENUE TO NEG ATE THE SAME. THE RESPONDENT ASSESSEE DULY EXPLAINED THE SOURCE OF FU NDS ON THE BASIS OF COGENT MATERIAL, WHICH HAS NOT BEEN FOUND TO BE UNRELIABLE OR FALSE. THEREFORE, WE AFFIRM THE ORDER OF THE CIT(A) ON THIS ASPECT AND A CCORDINGLY THE REVENUE FAILS. 9. RESULTANTLY, THE APPEAL FILED BY THE REVENUE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 14/08/2015 ' *+ ,- 14/08/2015 ' SD/- SD/- ( / SANJAY GARG ) ( . . / G.S.PANNU ) / JUDICIAL MEMBER / ACCOUNTANT MEMBER * MUMBAI; , DATED 14/08/2015 . / ITA NO.5088/MUM/2013 / ASSESSMENT YEAR 2009-10 5 ! / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. 0# ( ) / THE CIT(A)- 4. 0# / CIT 5. 12 #34 , $ 34 , * / DR, ITAT, MUMBAI 6. 5 / GUARD FILE. / BY ORDER, 1# # //TRUE COPY// / (DY./ASSTT. REGISTRAR) , * / ITAT, MUMBAI . . ./ VM , SR. PS