Income Tax Officer-3(3), Kanpur V. Smt. Priya Raheja, Kanpur

ITA 559/LKW/2014

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 4641 (ITAT-LUCKNOW)
• Duration Of Justice: 1 year(s) 8 month(s) 14 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-03-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 02-03-2016
• Assessment Year: 2008-2009
• Appeal Filed On: 03-07-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Unexplained cash credit; Business expenditure
• Section: 68; 69

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH B, LUCKNOW BEFORE SHRI SUNIL KUMAR YADAV, JUDICIAL MEMBER AND SHRI A.K. GARODIA, ACCOUNTANT MEMBER ITA NO.559/LKW/2014 ASSESSMENT YEAR:2008-09 SMT. PRIYA RAHEJA, FLAT NO. 502, 7/85 TILAK NAGAR, KANPUR. PAN:AICPR7199F VS INCOME TAX OFFICER-3(3), KANPUR. (RESPONDENT) (APPELLANT) SHRI AMIT NIGAM, D. R. APPELLANT BY SHRI RAKESH GARG, ADVOCATE RESPONDENT BY 03/03/2016 DATE OF HEARING 17/03/2016 DATE OF PRONOUNCEMENT O R D E R PER A. K. GARODIA, A.M. THIS IS REVENUES APPEAL DIRECTED AGAINST THE OR DER PASSED BY LEARNED CIT(A)-II, KANPUR DATED 27/03/2014 FOR THE ASSESSMENT YEAR 2008- 09. 2. GROUND NO. 1 IS AS UNDER: 1. THAT THE LD. COMMISSIONER OF INCOME TAX (APPEAL S)-II, KANPUR HAS ERRED IN LAW AND ON FACTS IN DELETING TH E ADDITION OF RS.78,059/- MADE BY THE ASSESSING OFFIC ER WITHOUT APPRECIATING THE FACTS BROUGHT ON RECORD BY THE ASSESSING OFFICER WHO RIGHTLY ADDED THE OPENING STO CK AS THERE WAS NO CLOSING STOCK AS ON 31.03.2007. 3. LEARNED D. R. OF THE REVENUE SUPPORTED THE ORDER OF ASSESSING OFFICER WHEREAS LEARNED A. R. OF THE ASSESSEE SUPPO RTED THE ORDER OF LEARNED CIT(A). 2 4. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. WE FI ND THAT AS PER THE FINDING GIVEN BY CIT(A) ON PAGE NO. 10 OF HIS ORDER , TAKING OF OPENING STOCK OF RS.78,059.38 BY THE ASSESSEE IS EVIDENT FROM SHA RE PURCHASE DETAILS AND FROM DEMAT ACCOUNT AND ACCOUNTS OF THE ASSESSEE. T HE OBJECTION OF THE ASSESSING OFFICER IS THAT THE ASSESSEE HAS TAKEN TH E OPENING STOCK IN TRADING ACCOUNT BUT IN THE RETURN OF INCOME FILED BY THE AS SESSEE IN PRECEDING YEAR 2007-08, NIL CLOSING STOCK HAS BEEN SHOWN. ON THIS ASPECT, THIS IS THE CLAIM OF THE ASSESSEE THAT THE RETURN OF INCOME FOR ASSES SMENT YEAR 2007-08 WAS FILED WITHOUT ANY TRADING ACCOUNT AND BALANCE SHEET AND IN THE PRESENT YEAR, THE BOOKS OF ACCOUNTS WERE MAINTAINED AND OPENING S TOCK HAS BEEN TAKEN ON THE VALUATION OF THE SHARES ON DEMAT ACCOUNT AS ON 01/04/2007. UNDER THESE FACTS, WE FIND NO REASON TO INTERFERE IN THE ORDER OF CIT(A). ACCORDINGLY, GROUND NO. 1 IS REJECTED. 5. GROUND NO. 2 IS AS UNDER: 2. THAT THE LD. COMMISSIONER OF INCOME TAX (APPEA LS)-II, KANPUR HAS ERRED IN LAW AND ON FACTS IN DELETING TH E ADDITION OF RS.10,46,375/- MADE BY THE ASSESSING OF FICER WITHOUT APPRECIATING THE FACTS BROUGHT ON RECORD BY THE ASSESSING OFFICER WHO RIGHTLY DISALLOWED THE EXPENS ES AS THE ASSESSEE WAS NOT ABLE TO SUBSTANTIATE HER CLAIM IN RESPECT OF THE EXPENSES. 6. LEARNED D. R. OF THE REVENUE SUPPORTED THE ORDER OF ASSESSING OFFICER WHEREAS LEARNED A. R. OF THE ASSESSEE SUPPO RTED THE ORDER OF LEARNED CIT(A). 7. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. WE FI ND THAT OUT OF TOTAL DISALLOWANCE OF RS.10,46,375/-, THE MAJOR AMOUNT IS RS.8,29,128.25 UNDER THE HEAD SHARE CALL OPTION PREMIUM AND RS.1,67,030. 63 ON ACCOUNT OF BROKERAGE ON SHARES. REGARDING BOTH THESE AMOUNTS, A CATEGORICAL FINDING HAS BEEN GIVEN BY CIT(A) ON PAGE NO. 12 OF HIS ORDE R THAT THESE 3 TRANSACTIONS ARE WELL EVIDENT FROM THE RELEVANT STA TEMENT OF THE SHARE BROKER, CONTRACT NOTE, BANK STATEMENT AND ARE VERIF IABLE AND ARE RELATED TO BUSINESS AND THEREFORE, THE ADDITION MADE IS DELETE D. THIS FINDING OF CIT(A) COULD NOT BE CONTROVERTED BY LEARNED D. R. OF THE R EVENUE. THE REMAINING AMOUNTS ARE PETTY AMOUNTS ON ACCOUNT OF PETTY EXPEN SES SUCH AS BANK CHARGES, D.P. CHARGES, INTEREST ON LOAN, MISC. EXPE NSES, MEMBERSHIP SUBSCRIPTION FEE AND SECURITY TRANSACTION TAX. REG ARDING THESE EXPENSES ALSO, A CATEGORICAL FINDING HAS BEEN GIVEN BY CIT(A ) THAT THE ASSESSING OFFICER HAS NOT BROUGHT ANY EVIDENCE AGAINST THE AD MISSIBILITY OF THESE EXPENSES AND THEREFORE, THESE EXPENSES ARE CONSIDER ED AS BUSINESS EXPENSES AND THE ADDITIONS MADE ARE DELETED. LEARN ED D. R. OF THE REVENUE COULD NOT CONTROVERT ANY OF THESE FINDINGS OF CIT(A) AND, THEREFORE, WE FIND NO REASON TO INTERFERE IN THE ORDER OF CIT( A). GROUND NO. 2 IS REJECTED. 8. GROUND NO. 3 IS AS UNDER: 3. THAT THE LD. COMMISSIONER OF INCOME TAX (APPEA LS)-II, KANPUR HAS ERRED IN LAW AND ON FACTS IN DELETING TH E ADDITION OF RS.15,77,500/- MADE BY THE ASSESSING OF FICER WITHOUT APPRECIATING THE FACTS BROUGHT ON RECORD BY THE ASSESSING OFFICER WHO RIGHTLY ADDED THE UNSECURED L OANS RAISED BY THE ASSESSEE U/S 68 OF THE I.T. ACT, 1961 AS THE ASSESSEE COULD NOT PROVE THE IDENTITY, GENUINENESS AND CREDIT WORTHINESS OF THE CONCERNED PERSONS. 9. LEARNED D. R. OF THE REVENUE SUPPORTED THE ORDER OF ASSESSING OFFICER WHEREAS LEARNED A. R. OF THE ASSESSEE SUPPO RTED THE ORDER OF LEARNED CIT(A). 10. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. WE F IND THAT THIS ADDITION IS OF THE TOTAL AMOUNT OF VARIOUS LOANS OUTSTANDING IN THE BOOKS OF ACCOUNTS OF THE ASSESSEE AND REGARDING EACH OF THESE LOANS, A CATEGORICAL FINDING HAS BEEN GIVEN BY CIT(A) THAT THE MAJOR AMOUNT IS REGAR DING OPENING BALANCE 4 AND REGARDING THE SMALL AMOUNTS WHICH WERE RECEIVED DURING THE PRESENT YEAR, THE ASSESSEE HAS SATISFACTORILY DISCHARGED HI S BURDEN OF PROVING THE LOAN. THIS CATEGORICAL FINDING OF CIT(A) COULD NOT BE CONTROVERTED BY LEARNED D. R. OF THE REVENUE AND THEREFORE, WE DO N OT FIND ANY REASON TO INTERFERE IN THE ORDER OF CIT(A) ON THIS ISSUE. TH IS GROUND IS REJECTED. 11. GROUND NO. 4 IS AS UNDER: 4. THAT THE LD. COMMISSIONER OF INCOME TAX (APPEA LS)-II, KANPUR HAS ERRED IN LAW AND ON FACTS IN DELETING TH E ADDITION OF RS.7,18,159/- MADE BY THE ASSESSING OFF ICER WITHOUT APPRECIATING THE FACTS BROUGHT ON RECORD BY THE ASSESSING OFFICER WHO RIGHTLY ADDED THE UNEXPLAINED SUNDRY CREDITORS U/S 68 OF THE I.T. ACT, 1961 AS TH E ASSESSEE COULD NOT SUBSTANTIATE THESE CREDITS. 12. LEARNED D. R. OF THE REVENUE SUPPORTED THE ORDE R OF ASSESSING OFFICER WHEREAS LEARNED A. R. OF THE ASSESSEE SUPPO RTED THE ORDER OF LEARNED CIT(A). 13. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. WE F IND THAT ON PAGE NO. 23 OF HIS ORDER, A CATEGORICAL FINDING HAS BEEN GIV EN BY CIT(A) THAT THE ASSESSEE HAS ADMITTED THE LIABILITY OF RS.7,18,159. 49 AGAINST THE LIABILITY SHOWN BY THE CREDITOR FOR RS.7,56,963.40 AND THE AS SESSEE HAS ADMITTED THE DIFFERENCE IN LIABILITY IN NEXT FINANCIAL YEAR AND THEREFORE, THE LIABILITY SHOWN OF RS.7,18,159.49 IS EVIDENCED FROM THE STATEMENT O F THE PARTIES AND THEREFORE, THE ADDITION MADE BY THE ASSESSING OFFIC ER IS DELETED. CONSIDERING THIS FACTUAL FINDING OF CIT(A) WHICH CO ULD NOT BE CONTROVERTED BY LEARNED D. R. OF THE REVENUE, WE FIND NO REASON TO INTERFERE IN THE ORDER OF CIT(A). GROUND NO. 4 IS REJECTED. 14. GROUND NO. 5 IS AS UNDER: 5. THAT THE LD. COMMISSIONER OF INCOME TAX (APPEAL S)-II, KANPUR HAS ERRED IN LAW AND ON FACTS IN DELETING TH E 5 ADDITION OF RS.21,06,261/- MADE BY THE ASSESSING OF FICER WITHOUT APPRECIATING THE FACTS BROUGHT ON RECORD BY THE ASSESSING OFFICER WHO RIGHTLY ADDED THE UNEXPLAINED OTHER LIABILITIES U/S 68 OF THE I.T. ACT, 1961 AS T HE ASSESSEE COULD NOT PROVE THE GENUINENESS OF THESE CREDITS. 15. LEARNED D. R. OF THE REVENUE SUPPORTED THE ORDE R OF ASSESSING OFFICER WHEREAS LEARNED A. R. OF THE ASSESSEE SUPPO RTED THE ORDER OF LEARNED CIT(A). 16. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. WE F IND THAT ON PAGE NO. 24 OF HIS ORDER, A FINDING HAS BEEN GIVEN BY CIT(A) THAT THE CONTENTION OF THE ASSESSEE HAS BEEN ACCEPTED BY THE ASSESSING OFF ICER IN REMAND PROCEEDINGS AS PER WHICH THE RENT SECURITY IS EVIDE NCED FROM RENT AGREEMENT DATED 16/10/2007 AND FURTHER THE SAME HAS BEEN APPROPRIATED AGAINST RENT IN NEXT FINANCIAL YEAR. IN VIEW OF TH IS FINDING OF CIT(A) WHICH COULD NOT BE CONTROVERTED BY LEARNED D. R. OF THE R EVENUE, WE FEEL THAT NO INTERFERENCE IS CALLED FOR IN THE ORDER OF CIT(A) O N THIS ISSUE. GROUND NO. 5 IS REJECTED. 17. GROUND NO. 6 & 7 ARE AS UNDER: 6. THAT THE LD. COMMISSIONER OF INCOME TAX (APPEAL S)-II, KANPUR HAS ERRED IN LAW AND ON FACTS IN DELETING TH E ADDITION OF RS.5,93,272/- MADE BY THE ASSESSING OFF ICER WITHOUT APPRECIATING THE FACTS BROUGHT ON RECORD BY THE ASSESSING OFFICER WHO RIGHTLY ADDED THE UNEXPLAINED CREDITS IN THE SAVING BANK ACCOUNT U/S 69 OF THE I.T. ACT, 1961 AS THE ASSESSEE COULD NOT PROVE THE GENUINENES S OF THESE CREDITS. 7. THAT THE LD. COMMISSIONER OF INCOME TAX (APPEALS )-II, KANPUR HAS ERRED IN LAW AND ON FACTS IN DELETING TH E ADDITION OF RS.31,69,650/- MADE BY THE ASSESSING OF FICER WITHOUT APPRECIATING THE FACTS BROUGHT ON RECORD BY THE ASSESSING OFFICER WHO RIGHTLY ADDED THE UNEXPLAINED CREDITS IN THE SAVING BANK ACCOUNT U/S 69 OF THE I. T. ACT, 6 1961 AS THE ASSESSEE COULD NOT PROVE THE GENUINENES S OF THESE CREDITS. 18. LEARNED D. R. OF THE REVENUE SUPPORTED THE ORDE R OF ASSESSING OFFICER WHEREAS LEARNED A. R. OF THE ASSESSEE SUPPO RTED THE ORDER OF LEARNED CIT(A). 19. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. WE F IND THAT THE ASSESSING OFFICER HAS MADE ADDITION OF CREDIT OF RS.5,93,272/ - IN THE CASE OF ALLAHABAD BANK AND CREDIT OF RS.31,69,650/- IN THE CASE OF SB ACCOUNT OF BANK OF INDIA. ON PAGE NO. 26, A CATEGORICAL FINDING HAS B EEN GIVEN BY CIT(A) THAT CASH DEPOSIT IN ABOVE BANK ACCOUNTS ON VARIOUS DATE S ARE SUPPORTED BY CASH BOOK MAINTAINED BY THE ASSESSEE AND BOOKS OF ACCOUN TS HAVE BEEN PRODUCED BEFORE THE ASSESSING OFFICER IN ASSESSMENT PROCEEDINGS AND ALSO IN REMAND PROCEEDINGS AND ALSO BEFORE CIT(A). LEAR NED D. R. OF THE REVENUE COULD NOT CONTROVERT THIS FINDING OF CIT(A) THAT THE DEPOSIT OF CASH IN THESE TWO BANK ACCOUNTS IS EVIDENCED BY CASH BOO K AND THEREFORE, WE FIND NO REASON TO INTERFERE IN THE ORDER OF CIT(A). ACCORDINGLY, THESE GROUNDS ARE REJECTED. 20. IN THE RESULT, THE APPEAL OF THE REVENUE STANDS DISMISSED. (ORDER WAS PRONOUNCED IN THE OPEN COURT ON THE DATE MENTIONED ON THE CAPTION PAGE) SD/. SD/. (SUNIL KUMAR YADAV) ( A. K. GAROD IA ) JUDICIAL MEMBER ACCOUNTANT ME MBER DATED:17/03/2016 *SINGH COPY OF THE ORDER FORWARDED TO : 1.THE APPELLANT 2.THE RESPONDENT. 3.CONCERNED CIT 4.THE CIT(A) 5.D.R., I.T.A.T., LUCKNOW ASSTT. REGISTRAR