ACIT, Coimbatore V. T.Radhakrishnan, Coimbatore

ITA 548/CHNY/2013

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 73686 (ITAT-CHENNAI)
• Duration Of Justice: 10 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-02-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Next Hearing Date: 18-02-2014
• Assessment Year: 2009-2010
• Appeal Filed On: 01-04-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: N MADHAVAN
• Assessee Lawyers: T N SEETHARAMAN
• Keywords: Unexplained cash credit
• Section: 68

Judgement Text

, , IN THE INCOME-TAX APPELLATE TRIBUNAL C BENCH, CHENNAI . , . !' !' !' !' , # # # # $ $ $ $ BEFORE SHRI A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER & SHRI V. DURGA RAO, JUDICIAL MEMBER ./ I.T.A.NO.548/MDS/2013 # ' %' / ASSESSMENT YEAR:2009-10 THE ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE II, COIMBATORE. VS. SHRI T. RADHAKRISHNAN, 2/1, RUKMANI ILLAM, THIRUMURUGAN NAGAR, 5 TH STREET, P.N. PUDUR, COIMBATORE. [PAN : ACDPR5062J] ( &' &' &' &' / APPELLANT ) ( ()&' ()&' ()&' ()&' / RESPONDENT ) &' * + / APPELLANT BY : SHRI N. MADHAVAN, JCIT ()&' * + / RESPONDENT BY : SHRI T.N. SEETHARAMAN, ADVOCATE * , / DATE OF HEARING : 18.02.2014 -% * , /DATE OF PRONOUNCEMENT : 26.02.2014 . . . . / O R D E R PER V. DURGA RAO, JUDICIAL MEMBER : THIS APPEAL FILED BY THE REVENUE IS DIRECTED AGAINS T THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS) I, COIMBATORE, DATED 16.01.2013 RELEVANT TO THE ASSESSMENT YEAR 2009-10. 2. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE I S AN INDIVIDUAL, FILED HIS RETURN OF INCOME ADMITTING TOTAL INCOME OF ` .62,87,300/-. THE CASE OF THE ASSESSEE WAS SELECTED FOR SCRUTINY AND AFTER DUE PR OCESS, THE ASSESSEE WAS I.T.A. I.T.A. I.T.A. I.T.A. NO. NO. NO. NO.5 55 548 4848 48/M/ /M/ /M/ /M/13 1313 13 2 ASKED TO SUBMIT DETAILS OF CASH DEPOSITS MADE IN HI S SAVING BANK ACCOUNT WITH SOUTH INDIAN BANK TO THE TUNE OF ` .30,55,063/-. THE ASSESSEE HAS FILED ALL THE DETAILS AS ASKED BY THE ASSESSING OFFICER A ND ALSO STATED AS UNDER: 1. AS PER THE SALE DEED WE HAVE ACCOUNTED THE REC EIPT IN THE BOOKS OF ACCOUNTS ON THE DATE OF SALE. 2. THE SALE DEED HAS MENTIONED AN AMOUNT OF ADVANC E BUT DOES NOT MENTION THE DATE OR TIME OF RECEIPT OF ADVANCE AND IN SUCH SCENARIO THE ACCOUNTANT CAN ONLY ACCOUNT ON THE DAT E OF DOCUMENTATION AND NOT ON ANY OTHER DATE. 3. IT IS PERTINENT HERE TO NOTE THAT IT IS MENTION ED IN SALE DEED ONLY AS ADVANCE AND NEITHER THE DATE NOT THE PLACE OF AD VANCE IS MENTIONED IN THE SALE DEED. THE ADVANCE MAY BE AT T HE OFFICE BEFORE THE REGISTRATION AND IT MAY BE AS EXPLAINED IN OUR EARLIER LETTER ON THIS SUBJECT. WHEN NEITHER THE DATE IS NO T MENTIONED IN THE SALE DEED NOR ANY DOCUMENT TO SHOW THE DATE OF ADVANCE, HOW IT IS POSSIBLE TO ENTER THE RECEIPT ON ANY EARL IER DATE. FURTHER ANY EARLIER DATE ITSELF WILL BE QUESTIONED BY YOUR GOOD SELF FOR WANT OF PROOF. 4. THE ASSESSEE DOES NOT MAINTAIN ANY PHYSICAL REC EIPT BOOK AND NO RECEIPT HAVE BEEN ISSUED TO THE BUYER FOR THE SALE. THE SALE DOCUMENT IS THE BASIC DOCUMENT FOR THE SALE ACCOUNT ING AND HE HAS RECEIVED THE AMOUNT OF SALE AND ACCOUNTED THE S AME ON THE CASH BOOK. 5. YOU HAVE MENTIONED THAT ONLY HALF OF THE AMOUNT IS SHOWN IN THE BOOKS, IT IS CORRECT AS THE ASSESSEE IS 50% OWNER O F THE LAND AND HENCE INCOME ACCRUES TO THE ASSESSEE ONLY 50%. 6. IT IS ONLY WRONG IF THE ASSESSEE ACCOUNTED AN A MOUNT PRIOR TO THE DATE OF RECEIPT AS IT CAN BE TREATED AS AN UNEXPLAI NED RECEIPT. FOR EXAMPLE, THE DOCUMENT DATE IS 6.10.2008 AND IF THE ASSESSEE ACCOUNTS THE SAME ON 06.09.2008 FOR THE CASH RECEIP T IS SHOWN ON THE DATE OF TRANSACTION OR SUBSEQUENTLY THERE IS NO CONCEALMENT OF CASH AND HENCE THE CASH BOOK CANNOT BE REJECTED. I.T.A. I.T.A. I.T.A. I.T.A. NO. NO. NO. NO.5 55 548 4848 48/M/ /M/ /M/ /M/13 1313 13 3 3. THE ASSESSEE HAS ACCOUNTED THE ENTIRE RECEIPTS IN THE BOOKS OF ACCOUNT ON THE DATE OF SALE BUT THE ASSESSEE HAS RE CEIVED APPROXIMATELY 75% OF SALE CONSIDERATION AS AN ADVANCE AND BALANCE APPROXIMATELY 25% AT THE TIME OF REGISTRATION. HOWEVER, THE ASSESSING OF FICER HAS RECOMPUTED THE SOURCE OF CASH IN HANDS OF THE ASSESSEE BASED ON TH E [APPROXIMATELY 25% OF SALE VALUE) CASH RECEIVED ON THE DATE OF SALE. T HE ASSESSING OFFICER HAS ALSO OBSERVED THAT THE CASH BOOK WAS REWORKED SO AS TO GIVE THE CORRECT PICTURE, WHICH REFLECTS THE NEGATIVE BALANCE IN THE CASH BOOK OF THE ASSESSEE ON CERTAIN DATES. SINCE, THERE WAS NO ADEQUATE SOUR CE OF CASH DEPOSIT IN SOUTH INDIAN BANK, THE DIFFERENCE AS PER THE WORKIN G OF THE ASSESSING OFFICER WAS ADDED TO THE INCOME OF THE ASSESSEE TO THE EXTENT OF ` .18,58,900/- AS UNEXPLAINED CASH CREDIT UNDER SECTI ON 68 OF THE ACT . 4. THE ASSESSEE CARRIED THE MATTER IN APPEAL BEFOR E THE LD. CIT(APPEALS) AND THE LD. CIT(APPEALS), AFTER CONSIDERING THE EXP LANATION OF THE ASSESSEE, HAS DELETED THE ADDITION MADE BY THE ASSESSING OFFI CER BY OBSERVING AS UNDER: I HAVE GONE THROUGH THE SUBMISSIONS MADE BY THE AP PELLANT AND ALSO THE ORDER OF THE ASSESSING OFFICER. AS SEEN FROM TH E ASSESSMENT ORDER AT PARA 5 THE ASSESSEE SUBMITTED THE CASH BOOK ALO NG WITH SALE DEEDS FOR SALE OF THE SITES, WHICH IS THE MAIN INFLOW OF CASH IN THE CASH BOOK OF ASSESSEE. THE ASSESSING OFFICER IN HIS ORDER STA TED THAT THE CASH BOOK RECEIPT IS EXACTLY THE TOTAL SALE VALUE RECEIVED BY THE ASSESSEE FOR HIS SHARE FOR THE SALE OF THE PARTICULAR SITE ON A PART ICULAR DATE AND THE ADVANCE RECEIPT IS ALSO ACCOUNTED ON THE SAME DATE WHICH IS CONTRARY TO THE FACTS SHOWN IN SALE DEED. THE ASSESSING OFFICER FELT THAT THE CASH BOOK OF THE ASSESSEE DOES NOT REFLECT THE CORRECT P ICTURE. THE ASSESSING I.T.A. I.T.A. I.T.A. I.T.A. NO. NO. NO. NO.5 55 548 4848 48/M/ /M/ /M/ /M/13 1313 13 4 OFFICER HAS TAKEN APPROXIMATELY 25% OF SALE VALUE R ECEIVED BY CASH ON THE DATE OF SALE AND RE-COMPUTED THE CASH BOOK. IN MY OPINION THE ASSESSING OFFICER HAS RE-COMPUTED THE CASH BOOK WIT HOUT ANY BASIS. THE FACT THAT THE APPELLANT HAS RECORDED THE COMPLE TE RECEIPTS RECEIVED BY HIM CANNOT BE IGNORED. THE ESTIMATED CASH FLOW I S WITHOUT ANY BASIS AND ARRIVING AT THE CASH BALANCE AND CASH DEFICIT B ASED ON PRESUMPTION AMOUNTS TO ONLY AN ESTIMATION. THE APPELLANT HAS AC COUNTED FOR ALL THE RECEIPTS. IT IS TRUE THAT THE ADVANCE RECEIPTS WERE ALSO ACCOUNTED ON THE DATE OF SALE DEED ONLY. THERE IS ALSO NO EVIDENCE T O PROVE THAT THE ADVANCE WAS RECEIVED ON A PARTICULAR DATE. IN THESE CIRCUMSTANCES, IT IS TO BE LOOKED INTO, WHETHER THE TOTAL AMOUNTS HAVE B EEN ACCOUNTED OR NOT BY THE APPELLANT. AS SEEN FROM THE FACTS THE AP PELLANT HAD ACCOUNTED FOR THE TOTAL RECEIPTS INCLUDING ADVANCES . THERE WAS NO DEFICIENCY OF CASH WHENEVER CASH DEPOSITS WERE MADE INTO THE BANK. IN VIEW OF THIS, RECOMPUTATION OF CASH BOOK MADE BY TH E ASSESSING OFFICER WITHOUT ANY BASIS CANNOT BE CONSIDERED. THE ASSESSI NG OFFICER IS DIRECTED TO DELETE THE ADDITION. 5. AGGRIEVED, THE REVENUE IS IN APPEAL BEFORE THE TRIBUNAL AND THE LD. DR HAS STRONGLY SUPPORTED THE ORDER PASSED BY THE A SSESSING OFFICER. 6. ON THE OTHER HAND, THE LD. COUNSEL FOR THE ASSE SSEE HAS STRONGLY SUPPORTED THE ORDER PASSED BY THE LD. CIT(APPEALS). 7. WE HAVE HEARD BOTH SIDES, PERUSED THE MATERIALS ON RECORD AND GONE THROUGH THE ORDERS OF AUTHORITIES BELOW. IN THIS CA SE, THE ASSESSEE HAS SOLD THE PROPERTY AND THE ENTIRE SALE RECEIPTS ACCOUNTED IN THE BOOKS OF ACCOUNT ON THE DATE OF SALE. HOWEVER, IN THE SALE DEED, THE RE WAS MENTION OF AMOUNT OF ADVANCE, BUT DOES NOT MENTION THE DATE OR TIME O F RECEIPT OF ADVANCE. THEREFORE, THE ASSESSING OFFICER CAME TO A CONCLUSI ON THAT THE ASSESSEE MUST HAVE RECEIVED ADVANCE OF 75% AND REMAINING 25% AT THE TIME OF EXECUTION OF SALE DEED AND COMPARING THE BANK STATE MENT OF ASSESSEES I.T.A. I.T.A. I.T.A. I.T.A. NO. NO. NO. NO.5 55 548 4848 48/M/ /M/ /M/ /M/13 1313 13 5 SAVING BANK ACCOUNT VIDE ASSESSMENT ORDER PAGE NO. 5, 6, 7 AND 8, WORKED OUT THE DIFFERENCE AND ACCORDING TO THE ASSESSING O FFICER, THE DIFFERENCE WAS TREATED AS UNEXPLAINED CASH CREDIT UNDER SECTION 68 OF THE ACT. THERE IS NOTHING ON RECORD FOR THE ASSESSING OFFICER TO COME SUCH A CONCLUSION THAT THE ASSESSEE HAS RECEIVED THE ADVANCE OF 75% OF THE SALE PROCEEDS, BECAUSE NOTHING WAS MENTIONED IN THE SALE DEED. IT IS A FACT THAT THE ASSESSEE HAD RECEIVED SOME ADVANCE, BUT WHEN HE HAS RECEIVED THE ADVANCE WAS NOT CLEAR. THE CASE OF THE ASSESSEE IS THAT THE BROKER HAS RECEIVED THE ADVANCE. HOWEVER, THE ASSESSEE HAS DIS CLOSED ALL THE SALE PROCEEDS BEFORE THE ASSESSING OFFICER. THE ONLY DIS PUTE IS WITH REGARD TO DATE OF RECEIPT OF ADVANCE. WHEN THERE IS NOTHING O N RECORD TO SUGGEST THAT THE ASSESSEE HAS RECEIVED THE ADVANCE, THE ASSESSIN G OFFICER HAS JUST CAME TO SUCH A CONCLUSION THAT THE ASSESSEE HAS REC EIVED APPROXIMATELY 75% OF SALE CONSIDERATION AS ADVANCE AND RECEIVED 2 5% AT THE TIME OF SALE WITHOUT ANY MATERIAL EVIDENCE. UNDER THESE FACTS AN D CIRCUMSTANCE, WE FIND THAT IT IS NOT A CASE TO INVOKE SECTION 68 OF THE A CT. MOREOVER, THE LD. CIT(APPEALS) HAS CAREFULLY EXAMINED THE CASE AND FO UND THAT THE ASSESSEE HAD ACCOUNTED THE TOTAL RECEIPTS INCLUDING ADVANCES AND THERE WAS NO DEFICIENCY OF CASH WHENEVER CASH DEPOSITS WERE MADE INTO THE BANK. THEREFORE, THE LD. CIT(APPEALS) DIRECTED THE ASSESS ING OFFICER TO DELETE THE ADDITION SINCE THE RECOMPUTATION OF CASH BOOK MADE BY THE ASSESSING OFFICER WAS WITHOUT ANY BASIS. KEEPING IN VIEW OF T HE FACTS AND I.T.A. I.T.A. I.T.A. I.T.A. NO. NO. NO. NO.5 55 548 4848 48/M/ /M/ /M/ /M/13 1313 13 6 CIRCUMSTANCES OF THE CASE, WE FIND NO INFIRMITY IN THE ORDER PASSED BY THE LD. CIT(APPEALS) AND DISMISS THE GROUNDS RAISED BY THE REVENUE. 08. IN THE RESULT, THE APPEAL FILED BY THE REVENUE IS DISMISSED. ORDER PRONOUNCED ON WEDNESDAY, THE 26 TH OF FEBRUARY, 2014 AT CHENNAI. SD/- SD/- (A. MOHAN ALANKAMONY) ACCOUNTANT MEMBE R (V. DURGA RAO) JUDICIAL MEMBER CHENNAI, DATED, THE 26.02.2014 VM/- TO: THE ASSESSEE/A.O./CIT(A)/CIT/D.R.