ITO, Meerut V. Sh. Vipin Sirohi, Meerut

ITA 5465/DEL/2013

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 86715 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 4 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-02-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: H
• Next Hearing Date: 12-02-2015
• Assessment Year: 2009-2010
• Appeal Filed On: 04-10-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: J P CHANDRAKAR
• Assessee Lawyers: VINOD GOEL
• Keywords: Unexplained cash credit

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH H , NEW DELHI BEFORE SH. I. P. BANSAL , JM AND SH. N. K. SAINI, AM ITA NO. 5465 /DEL/201 3 : ASSTT. YEAR : 200 9 - 10 INCOME TAX OFFICER, WAR D 2(4), MEERUT VS SHRI VIPIN SIROHI, L - 809, SHASTRI NAGAR, MEERUT (APPELLANT) (RESPONDENT) PAN NO. A IJPS9766L ASSESSEE BY : SH. VINOD GOEL, ADV. REVENUE BY : SH. J. P. CHANDRAKAR , SR. DR DATE OF HEARING : 12 .02 .2015 DATE OF PRONO UNCEMENT : 12 .02 .2015 ORDER PER N. K. SAINI, AM: THIS IS AN APPEAL BY THE DEPARTMENT AGAINST THE ORDER DATED 30.07.2013 OF LD. CIT(A), MEERUT . 2. FOLLOWING GROUNDS HAVE BEEN RAISED IN THIS APPEAL: 1. WHETHER IN THE FACTS AND CI RCUMSTANCES OF THE CASE, THE LD. COMMISSIONER OF INCOME TAX(APPEALS) HAS ERRED IN LAW IN DELETING THE ADDITION OF RS. 31,42,000/ - MADE BY THE AO ON ACCOUNT OF UNEXPLAINED CASH CREDIT IN THE BANK ACCOUNT OF THE ASSESSEE. MOREOVER, LD. CIT(A) HAS ALSO ERRED IN RELYING UPON THE ASSESSEE S CLAIM THAT SOURCE OF SOME DEPOSITS WAS EARLIER CASH WITHDRAWAL, FOR WHICH NO EVIDENCE WAS PRODUCED BY THE ASSESSEE. ITA NO . 5465 /DEL /2013 VIPIN SIROHI 2 2. WHETHER IN THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) HAS ERRED IN LAW IN DELETING THE ADDI TION OF RS. 1,70,000/ - WHICH WAS MADE BY THE AO BECAUSE THE SOURCE OF INVESTMENT IN THE NSC PURCHASED DURING THE YEAR HAD NOT BEEN EXPLAINED BY THE ASSESSEE. 3. THAT THE APPELLANT CRAVES LEAVE TO ADD, MODIFY AND/OR DELETE ANY GROUND(S) OF APPEAL. 4. IN T HE FACTS AND CIRCUMSTANCES OF THE CASE, THE ORDER OF THE CIT(A) MAY BE SET ASIDE AND THAT OF THE AO RESTORED. 3. VIDE GROUND NO. 1 GRIEVANCE OF THE DEPARTMENT RELATES TO THE DELETION OF ADDITION OF RS. 31,42,000/ - MADE BY THE AO ON ACCOUNT OF UNEXPLAINED DEPOSITS IN THE BANK ACCOUNT. 4. FACTS OF THE CASE IN BRIEF ARE THAT THE AO RECEIVED A N AIR INFORMATION AND COMPLAINT THAT THE ASSESSEE HAD DEPOSITED RS. 11,00,000/ - IN CASH IN HIS BANK ACCOUNT. HE, THEREFORE, ASKED THE ASSESSEE TO EXPLAIN THE SOURCE OF INVESTMENT AND GENUINENESS OF THE TRANSACTIONS RELATING TO THE CASH DEPOSITS. THE ASSESSEE SUBMITTED THAT THE CASH DEPOSITS IN THE BANK ACCOUNT WERE AFTER WITHDRAWALS FROM OTHER BANK ACCOUNTS. HOWEVER, THE AO WAS NOT SATISFIED AND MADE AN ADDITION OF RS. 31,42,000/ - TO THE TOTAL INCOME OF THE ASSESSEE. THE SAID AMOUNT REPRESENTED CASH DEPOSITS IN ICICI BANK, PNB BANK AND ALLAHABAD BANK OF RS. 1 0 ,90,000/ - , RS. 8,69,000/ - AND RS. 11,83,000/ - RESPECTIVELY. ITA NO . 5465 /DEL /2013 VIPIN SIROHI 3 5. BEING AGGRIEVED THE ASSESSEE CARRIED THE MATTER TO THE LD. CIT(A) AND FURNISHED COPIES OF ALL THE BANK ACCOUNT S MAINTAINED DURING THE PERIOD 01.04.2008 TO 31.03.2009. THE LD. CIT(A) MADE A REFERENCE TO THE AO REQUESTING HIM TO EXAMINE THE SUBMISSIONS AND , IF REQUIRED, MADE NECESSARY E NQUIRIES WITH THE ASSESSEE AND/OR ANY THIRD PARTY (INCLUDING THE BANK) IN THIS REGARD AND TO FURNISH A REPORT. THE AO FURNISHED THE REPORT VIDE LETTER DATED 16.07.2013 STATING THEREIN AS UNDER: DURING THE COURSE OF ASSESSMENT PROCEEDINGS THE ASSESSEE HAS EXPLAINED THE SOU RCE OF CASH DEPOSITS IN PARA 5 OF HIS LETTER DATED 04.02.2013 WHICH IS UNDER: - ALL AMOUNT DEPOSIT IN BANK ACCOUNT ARE WITHDRAWAL FROM ANOTHER ACCOUNT E.G. 17/12/2008 WITHDRAWAL FROM ALLAHABAD BANK A/C NO. 2019577 7461 RS. 6,00,000/ - & FROM PNB A/C NO. 444 2009300010229 RS. 4,70,00/ - TOTAL RS. 10,70,000/ - WHICH ARE DEPOSIT IN ICICI BANK A/C NO. 097501500725. 17.02.2009 WITHDRAWAL FROM ICICI BANK A/C NO. 097501500725 RS. 1,50,000/ - WHICH ARE DEPOSIT IN ALLAHABAD BANK A/C NO. 20195777461. 02.03.2009 WITHDRAWAL FROM ICICI BANK A/C NO. 097501500725 RS. 4,50,000/ - OUT OF WHICH RS. 4,00,000/ - ARE DEPOSIT IN PNB A/C NO. 4442009300010229. 12.03.2009 WITHDRAWAL FROM ICICI BANK A/C NO. 097501500725 RS. 1,00,000/ - WHICH ARE DEPOSIT IN PNB A/C NO. 4442009300010229 ETC. THESE WITHDRAWALS AND DEPOSITS ARE VERIFIABLE FROM BANK STATEMENTS OF THE ASSESSEE. DURING THE APPELLATE PROCEEDINGS THE ASSESSEE HAS FILED CASH DEPOSIT AND WITHDRAWAL DATE WISE STATEMENT WHICH SUPPORTS HIS EARLIER SUBMISSION. BUT IT IS NOTICED THAT THER E ITA NO . 5465 /DEL /2013 VIPIN SIROHI 4 ARE NUMEROUS CASH WITHDRAWALS AND DEPOSITS. THERE IS ALSO GAP OF SOME DAYS TO A MONTH AND ODD BETWEEN DATES OF WITHDRAWALS AND DEPOSITS. THE ASSESSEE HAS NOT MADE ANY STATEMENT ABOUT PURPOSE OF WITHDRAWAL AND CIRCUMSTANCES UNDER WHICH THE PURPOSE WAS NOT FULFILLED AND CASH WAS RE - DEPOSITED IN OTHER ACCOUNT OF THE ASSESSEE. THIS FACT IS IN THE KNOWLEDGE OF THE ASSESSEE ONLY AND UNLESS HE COMES OUT WITH SOME STATEMENT WITH COGENT REASON AND PROOF, IF POSSIBLE, THE CORRELATION BETWEEN WITHDRAWAL AND DEPOSIT CANNOT BE ACCEPTED. 6. THE LD. CIT(A) AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE AND REMAND REPORT OF THE AO DELETED THE IMPUGNED ADDITION BY OBSERVING IN PARA 2.4 OF THE IMPUGNED ORDER AS UNDER: 2.4 FROM THE ABOVE, IT IS APPARENT THAT THE DEPO SITS ARE VERIFIABLE FROM THE WITHDRAWALS MADE FROM OTHER BANK ACCOUNTS. SPECIFICALLY, THE DEPOSITS IN EXCESS OF RS. 1,00,000/ - WERE RS. 10,70,000/ - DEPOSITED IN ICICI BANK ON 17.12.2008, RS. 6,00,000/ - DEPOSITED IN ALLAHABAD BANK ON 02.08.2008, RS. 1,50,00 0/ - DEPOSITED IN ALLAHABAD BANK ON 17.02.2009, RS. 4,00,000/ - DEPOSITED IN ALLAHABAD BANK ON 02.03.2009, RS. 5,00,000/ - DEPOSITED IN PNB ON 02.08.2008 AND FINALLY RS. 1,00,000/ - DEPOSITED IN PNB ON 12.03.2009. EXPLANATION REGARDING THE ABOVE DEPOSITS GIVEN BY THE ASSESSEE (EXCEPT RS. 5,00,000/ - DEPOSITED IN PNB AND RS. 6,00,000/ - DEPOSITED IN ALLAHABAD BANK ON 02.08.2008) HAS BEEN FOUND VERIFIABLE BY ADDL. CIT, RANGE - 2, MEERUT, FROM THE BANK STATEMENT OF THE ASSESSEE, AS EVIDENT FROM THE EXTRACT REPRODUCED ABOVE. AS REGARDS RS. 5,00,000/ - DEPOSITED IN PNB ON 02.08.2008 AND RS. 6,00,000/ - DEPOSITED IN ALLAHABAD BANK ON 02.08.2008, NOTHING SPECIFIC HAS BEEN REPORTED BY THE ADDL. CIT EVEN THOUGH NO ADVERSE COMMENTS HAVE BEEN GIVEN. IN FACT, THE ADDL. CIT, RANGE - 2, MEERUT HAS CATEGORICALLY STATES THAT THE ITA NO . 5465 /DEL /2013 VIPIN SIROHI 5 SUBMISSION MADE AT THE APPELLATE STAGE SUPPORTS HIS EARLIER SUBMISSION . IT WAS EXPLAINED THAT THE ASSESSEE HAD AVAILED LOAN/OVERDRAFT OF RS. 4,50,000/ - AND RS. 5,50,000/ - FROM ALLAHABAD BANK AND PNB WHICH HAD BEEN DEPOSITED IN THE BANK ACCOUNT OF THE ASSESSEE. THESE HAD BEEN WITHDRAWN FROM THE ALLAHABAD BANK AND PNB ON 11.06.2008 AND 12.06.2008 RESPECTIVELY. COPY OF THE LOANS SANCTION LETTER FOR THESE AMOUNTS HAD BEEN FILED BEFORE THE AO DURING THE REMAND PROCE EDINGS, AND COPIES OF THE SAME HAVE ALSO BEEN SUBMITTED IN THE APPEAL PROCEEDINGS. FROM THE ABOVE, IT IS APPARENT THAT THE EXPLANATION GIVEN BY THE ASSESSEE DURING THE APPEAL PROCEEDINGS, THE CASH DEPOSITS WERE SOURCED OUT OF WITHDRAWAL MADE FROM THE BANK ACCOUNT IS CORRECT. IT IS FURTHER NOTED THAT THIS CONTENTION HAS ALSO BEEN MADE DURING THE HEARING OF THE CASE HELD ON 17.07.2003 WHEN THE ADDL. CIT, RANGE - 2, MEERUT WAS ALSO PRESENT. THE ONLY OBJECTION OF THE ADDL. CIT, RANGE - 2, MEERUT BOTH IN THE REPORT DATED 16.07.2013 AND IN THE COURSE OF HEARING ON 17.07.2013 WAS THE TIME GAP BETWEEN THE WITHDRAWALS OF THE AFORESAID AMOUNTS OF RS. 5,00,000/ - AND RS. 6,00,000/ - MADE IN JUNE 2008 WHEREAS THE DEPOSITS HAD BEEN MADE IN AUGUST 2008. THE COUNSEL OF THE ASSES SEE EXPLAINED THAT THE WITHDRAWALS WERE MADE FROM THE BANKING AUTHORITY SHOW AS TO SHOW, WITHIN A REASONABLE PERIOD OF THE DISBURSEMENT OF THE LOAN/OVERDRAFT, THE UTILIZATION OF SUCH AMOUNTS. 7. NOW THE DEPARTMENT IS IN APPEAL. THE LD. DR STRONGLY SUPPO RTED THE ORDER OF THE AO AND FURTHER SUBMITTED THAT THE ASSESSEE DID NOT EXPLAIN THE PURPOSE FOR WHICH THE WITHDRAWALS WERE MADE FROM BANKS AND WHERE WERE THOSE UTILIZED, THEREFORE, THE ADDITION DELETED BY THE LD. CIT(A) WAS NOT JUSTIFIED. ITA NO . 5465 /DEL /2013 VIPIN SIROHI 6 8. IN HIS RIVAL SUBMISSIONS THE LD. COUNSEL FOR THE ASSESSEE REITERATED THE SUBMISSIONS MADE BEFORE THE AUTHORITIES BELOW AND STRONGLY SUPPORTED THE IMPUGNED ORDER PASSED BY THE LD. CIT(A). 9. WE HAVE CONSIDERED THE SUBMISSIONS OF BOTH THE PARTIES AND CAREFULLY GONE THRO UGH THE MATERIAL AVAILABLE ON THE RECORD. IN THE PRESENT CASE IT IS NOTICED THAT THE AO IN HIS REMAND REPORT HAD STATED THAT THE WITHDRAWALS AND DEPOSITS WERE VERIFIABLE FROM THE BANK STATEMENTS OF THE ASSESSEE. HE HAD NOT MADE ANY ADVERSE COMMENTS TO THE SUBMISSIONS OF THE ASSESSEE AND THE LD. CIT(A) AFTER VERIFYING FROM THE VARIOUS BANK ACCOUNTS CAME TO THE CONCLUSION THAT THE EXPLANATION GIVEN BY THE ASSESSEE DURING THE APPEAL PROCEEDINGS THAT THE CASH DEPOSITS WERE SOURCED OUT OF WITHDRAWALS MADE FROM T HE BANK ACCOUNT WAS CORRECT. THE SAID FINDINGS OF THE LD. CIT(A) HAS NOT BEEN REBUTTED BY BRINGING ANY ADVERSE MATERIAL ON RECORD. THEREFORE, WE DO NOT SEE ANY VALID GROUND TO INTERFERE WITH THE FINDINGS OF THE LD. CIT(A), ACCORDINGLY, DO NOT SEE ANY MERIT ON THIS ISSUE OF THE DEPARTMENTAL APPEAL. 10. THE NEXT ISSUE VIDE GROUND NO. 2 RELATES TO THE DELETION OF ADDITION OF RS. 1,70,000/ - MADE BY THE AO FOR THE REASON TH AT THE SOURCES OF THE INVESTMENT FOR THE PURCHASE OF NSC DURING THE YEAR HAD NOT BEEN EXP LAINED. THE ASSESSEE CARRIED THE MATTER TO THE LD. CIT(A) AND STATED THAT THE INVESTMENT IN THE NSC S WERE SOURCED FROM THE EARLIER NSC ITA NO . 5465 /DEL /2013 VIPIN SIROHI 7 MATURED DURING THE YEAR. IT WAS ALSO STATED THAT THE NSC MATURED HAD BEEN CREDITED TO THE BANK ACCOUNT AND THE PURCHASE OF NSC HAD ALSO BEEN MADE FROM THE SAME BANK ACCOUNT. IT WAS FURTHER STATED THAT THE SIMILAR EXPLANATION WAS GIVEN DURING THE REMAND PROCEEDINGS AND THAT THE CREDIT ENTRIES IN RESPECT OF MATURED NSC AND THE INVESTMENT IN NEW NSC WERE ALSO VERIFIABLE FROM T HE BANK ACCOUNT. THE LD. CIT(A) AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE WAS OF THE VIEW THAT THE INVESTMENT IN NSC STOOD EXPLAINED. ACCORDINGLY, THE ADDITION OF RS. 1,70,000/ - WAS DELETED. 11. NOW THE DEPARTMENT IS IN APPEAL. THE LD. DR SUBMITTE D THAT THE ASSESSEE DID NOT EXPLAIN THE DATE OF MATURITY OF THE NSC, THEREFORE, SOURCE OF THE INVESTMENT IN NSC WAS NOT VERIFIABLE AND THE ADDITION WAS RIGHTLY MADE BY THE AO. IN HIS RIVAL SUBMISSIONS THE LD. COUNSEL FOR THE ASSESSEE REITERATED THE SUBMISS IONS MADE BEFORE THE LD. CIT(A) . 12. A FTER CONSIDERING THE SUBMISSIONS OF BOTH THE PARTIES, W E ARE OF THE VIEW THAT THE LD. CIT(A) RIGHTLY DELETED THE IMPUGNED ADDITION BECAUSE THE AMOUNT RECEIVED ON MATURITY OF THE OLD NSC WAS DEPOSITED IN THE BANK AND THE INVESTMENT WAS ALSO MADE BY WITHDRAWING THE SAME FROM THE BANK ACCOUNT . IN THE PRESENT CASE, THE LD. CIT(A) AFTER VERIFICATION FROM THE BANK ACCOUNTS FOUND MERIT IN THE SUBMISSIONS OF THE ASSESSEE AND DELETED THE IMPUGNED ADDITION . WE, THEREFORE, DO NO T SEE ANY INFIRMITY IN THE ORDER OF THE LD. CIT(A) ON THIS ISSUE. ITA NO . 5465 /DEL /2013 VIPIN SIROHI 8 13 . IN THE RESULT, THE APPEAL OF THE DEPARTMENT IS DISMISSED. ( ORDER PRON OUNCED IN THE COURT ON 12 /02 /2015 ) SD/ - SD/ - (I. P. BANSAL ) (N. K. SAI NI) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 12 /02 /2015 *SUBODH* COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. 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