ITO, New Delhi V. Sh. Mahendra Kumar Bhatnagar, New Delhi

ITA 5734/DEL/2011

• Counselvise Citation: [2013] 120 COUNSELVISE.COM (IT) 1378 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 2 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-03-2013
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: E
• Next Hearing Date: 05-03-2013
• Assessment Year: 2008-2009
• Appeal Filed On: 23-12-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: TARUN SEEM
• Section: 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL DELHI DELHI DELHI DELHI BENCH BENCH BENCH BENCH E EE E : NEW DELHI : NEW DELHI : NEW DELHI : NEW DELHI BEFORE SHRI G. BEFORE SHRI G. BEFORE SHRI G. BEFORE SHRI G.D.AGRAWAL, D.AGRAWAL, D.AGRAWAL, D.AGRAWAL, VICE PRESIDENT AND VICE PRESIDENT AND VICE PRESIDENT AND VICE PRESIDENT AND SHRI SHRI SHRI SHRI RAJPAL YADAV RAJPAL YADAV RAJPAL YADAV RAJPAL YADAV, JUDICIAL MEMBER , JUDICIAL MEMBER , JUDICIAL MEMBER , JUDICIAL MEMBER ITA NO. ITA NO. ITA NO. ITA NO.5734/DEL/2011 5734/DEL/2011 5734/DEL/2011 5734/DEL/2011 ASSESSMENT YEAR ASSESSMENT YEAR ASSESSMENT YEAR ASSESSMENT YEAR : : : : 2008 2008 2008 2008- -- -09 0909 09 INCOME TAX OFFICER, INCOME TAX OFFICER, INCOME TAX OFFICER, INCOME TAX OFFICER, WARD WARD WARD WARD- -- -31(2), 31(2), 31(2), 31(2), NEW DELHI. NEW DELHI. NEW DELHI. NEW DELHI. VS. VS. VS. VS. SHRI MAHEND SHRI MAHEND SHRI MAHEND SHRI MAHENDRA KUMAR BHATNAGAR, RA KUMAR BHATNAGAR, RA KUMAR BHATNAGAR, RA KUMAR BHATNAGAR, 7/8, BHAGWAN DAS ROAD, 7/8, BHAGWAN DAS ROAD, 7/8, BHAGWAN DAS ROAD, 7/8, BHAGWAN DAS ROAD, DDA OFFICERS FLATS, DDA OFFICERS FLATS, DDA OFFICERS FLATS, DDA OFFICERS FLATS, NEW DELHI. NEW DELHI. NEW DELHI. NEW DELHI. PAN : AAAPB1138N. PAN : AAAPB1138N. PAN : AAAPB1138N. PAN : AAAPB1138N. (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI TARUN SEEM, SR.DR. RESPONDENT BY : NONE. ORDER ORDER ORDER ORDER PER G. PER G. PER G. PER G.D.AGRAWAL, D.AGRAWAL, D.AGRAWAL, D.AGRAWAL, VP VPVP VP : : : : THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST THE O RDER OF LEARNED CIT(A)-XXVI, NEW DELHI DATED 12 TH OCTOBER, 2011 FOR THE AY 2008-09. 2. THE ONLY GROUND RAISED BY THE REVENUE READS AS UNDE R:- WHETHER LD.CIT(A) HAS ERRED IN DELETING THE UNEXPLA INED CASH CREDITS OF RS.17,81,000/- IN THE ABSENCE OF SUPPORT IVE EVIDENCE OF CASH DEPOSIT OF RS.12,81,000/- AND INVESTME NT OF RS.5,00,000/- IN LIFE INSURANCE AND MUTUAL FUNDS. 3. AT THE TIME OF HEARING BEFORE US, NONE APPEARED O N BEHALF OF THE ASSESSEE BUT A WRITTEN SUBMISSION IS PLACED ON RECORD. THE REFORE, WE PROCEED TO DECIDE THE APPEAL OF THE REVENUE AFTER H EARING THE LEARNED DR AND PERUSING THE WRITTEN SUBMISSION FILED BY THE ASSESSE E. ITA-5734/DEL/2011 2 4. THE FACTS OF THE CASE ARE THAT THE ASSESSEE IS A RETIRE D GOVERNMENT SERVANT AND DURING THE ACCOUNTING YEAR RE LEVANT TO ASSESSMENT YEAR UNDER CONSIDERATION, IT WAS FOUND THAT TH E ASSESSEE HAS DEPOSITED CASH IN STANDARD CHARTERED BANK AMOUNTIN G TO ` 10,89,000/-, ` 1,92,500/- WITH KOTAK MAHINDRA BANK AND ` 5,00,000/- INVESTED IN THE MUTUAL FUNDS. THE ASSESSING OFFICER TREA TED ALL THESE DEPOSITS TO BE UNEXPLAINED AND MADE THE ADDITION OF ` 17,81,000/-. ON APPEAL, LEARNED CIT(A) DELETED THE ADDITION. HENCE , THIS APPEAL BY THE REVENUE. 5. WE HAVE HEARD THE LEARNED DR AND PERUSED THE MATE RIAL PLACED BEFORE US INCLUDING THE WRITTEN SUBMISSION FILED BY TH E ASSESSEE. THE LEARNED CIT(A) DELETED THE ADDITION WITH THE FOLLOW ING FINDING:- 6. I HAVE GONE THROUGH THE SUBMISSIONS MADE BY THE APPELLANT, ASSESSMENT ORDER, FACTS AND CIRCUMSTANCES OF THE CASE AND CONSIDERED THEM. IN THE FIRST INSTANCE, I EXAMINED THE OBJECTION RAISED BY THE AR THAT BOOKS OF ACCOUNT DO NOT INCLUDE BANK PASS BOOK OR BANK STATEME NT, AND THEREFORE A CASH CREDIT IN THE BANK ACCOUNT DOE S NOT FALL WITHIN THE AMBIT OF SECTION 68 OF THE IT ACT, 1 961. THIS IS NOT A WELL FOUNDED GROUND AS THE BANK BOOK IS DEFIN ITELY WITHIN THE MEANING OF BOOKS OF ACCOUNTS, WHICH FORMS PRECISELY A PART OF THE GENERAL CASH BOOK. BOOKS OF ACCOUNT MAINTAINED BY THE ASSESSEE IN THE REGULAR COURSE OF BUSINESS ARE JOURNAL CASH BOOK, BANK BOOK, STOCK REGISTER, LEDGER ETC. IT IS THE BANK PASS BOOK WHICH REGULATES THE BUSINESS TRANSACTIONS. ALL THE TRANSACTIONS LIKE SALE, PURCHASE, LOANS RECEIPTS OF ANY MONEY IN THE FORM OF SHARE APPLICATION ETC. ARE ROUTED AND REGULA TED THROUGH THE BANK ACCOUNT. THEREFORE, THE ARGUMENT FORWARDED BY THE APPELLANT THAT A BANK PASS BOOK SHOUL D BE EXCLUDED FROM THE BOOKS OF ACCOUNT IS TOTALLY BASEL ESS AND IS HEREBY REJECTED. 6.1 IT IS A FACT THAT THE APPELLANT DEPOSITED AN AMOU NT OF RS.10,89,000/- IN STANDARD CHARTERED BANK AND A CASH DEPOSIT OF RS.1,92,000/- IN KOTAK MAHINDRA BANK RESPECTIVELY. IT WAS SUBMITTED BY THE AR THAT THESE ITA-5734/DEL/2011 3 DEPOSITS ARE MADE OUT OF THE RETIREMENT RECEIPTS, PAST SAVINGS FOR OVER 30 YEARS, AND ALSO RECEIPTS FROM HIS TWO SONS WHO ARE WORKING AS PROFESSIONALS IN THEIR RESPECTIVE FIELDS, AND SEND MONEY TO THEIR PARENTS ON REGULAR BA SIS. IT WAS ALSO SUBMITTED THAT THE APPELLANT WAS A CARDIOTHORA CIC PATIENT AND UNDERWENT A SEVERE CORONARY SURGERY IN 20 05 AT ESCORTS HEART INSTITUTE. IT WAS ALSO SUBMITTED THAT IN 2007, THE APPELLANT WAS DIAGNOSED WITH CHRONIC KIDNEY DISEASE AND WAS ADVISED A KIDNEY TRANSPLANT. IT WAS ALSO SUBMITTED THAT SINCE A POTENTIAL KIDNEY DONOR WAS NOT FOUND, HE IS ON REGULAR DIALYSIS. IT HAS BEEN VEHEMENT LY ARGUED THAT DUE TO THE FACTS MENTIONED ABOVE AND ON ACCOUNT OF ANY UNFORESEEN CIRCUMSTANCES, HE HAD TO KEE P SUFFICIENT CASH IN HAND AND FUNDS AT HIS RESIDENCE FOR MEDICINES AND CLINICAL TESTS. IT WAS ALSO STATED THAT AF TER THE UTILIZATION OF SUCH AMOUNTS, THE BALANCE WAS DEPOSI TED IN THE BANK ACCOUNT. IT HAS BEEN SUBMITTED THAT UND ER PRESSING CIRCUMSTANCES THE APPELLANT MAINTAINED CASH AT HOME, OUT OF WHICH EXCESS AMOUNT LEFT IN HAND WAS DEPOSITED IN BANKS. IT IS SEEN FROM THE DETAILS ON RECO RD, THAT THE ASSESSING OFFICER DID NOT CONDUCT ANY ENQUIRY OR ASK THE APPELLANT TO FURNISH NECESSARY DOCUMENTARY EVIDENCE TO SUBSTANTIATE HIS VERSION FOR THE CASH DEPOSIT ED AND WHICH OF THE EVIDENCE FURNISHED BY THE APPELLANT WAS NOT FOUND SATISFACTORY BY HIM. THE ASSESSING OFFICER WHE N CONFRONTED OR INFORMED WITH SUCH AN ENTRY, HE HAS TO SET FOOT APPROPRIATE ENQUIRIES TO DETERMINE THE TRUTH AS TO WHETHER THE SO CALLED DEPOSIT HAS BEEN MADE BY THE THI RD PARTY OR HAS COME OUT OF THE RESOURCES OF THE APPELLAN T HIMSELF. THE ASSESSING OFFICER HAS NOT ENQUIRED WHETHER THE APPELLANTS SONS WERE IN A POSITION TO EXTENDED SUCH AMOUNTS. DESPITE OF FURNISHING REASONS FOR KEEPING CA SH IN HAND, THE ASSESSING OFFICER HAS NOT BROUGHT OUT ANY MATERIAL ON RECORD CONTRARY TO THE CONTENTION OF TH E APPELLANT. THE ASSESSING OFFICER HAS JURISDICTION AND AUTHORITY TO MAKE ENQUIRIES REGARDING THE NATURE AND SOURCE OF SUCH SUM DEPOSITED, BUT THE SAME IS LACKING IN THE PRESENT CASE. THE ONLY EVIDENCE TENDERED BY THE APPELLANT IS THE STATEMENT OF THE BANK ACCOUNT, BUT T HE ASSESSING OFFICER DID NOT ANALYZE THE SAME AND SHOW HIS DISSATISFACTION WHILE REJECTING IT AND ADDING BANK TO THE INCOME OF THE APPELLANT. THE ASSESSING OFFICER DID NOT BRING ANY MATERIAL TO EVIDENCE THAT THE DEPOSITS CONSTITUTED THE INCOME OF THE APPELLANT. THE ASSESSING OFFICER HAS NOT PROVIDED ANY OPPORTUNITY TO THE APPE LLANT BEFORE MAKING SUCH AN ADDITION TO THE INCOME. IN T HE ITA-5734/DEL/2011 4 ABSENCE OF EVIDENCE, CONTRARY TO THE VERSION OF THE APPELLANT, I DELETE THE ADDITION AMOUNTING TO RS.12,81,000/- U/S 68 OF THE IT ACT, 1961 AND DIRECT THE ASSESSING OFFICER TO PASS A CONSEQUENTIAL ORDER ACCORDINGLY. 6.2 AS REGARDS THE INVESTMENT OF RS.2,00,000/- EACH IN MUTUAL FUNDS AND RS.1,00,000/- IN THE INSURANCE PREMI UM, AGGREGATING TO RS.5,00,000/-, I FIND THAT THERE ARE BANK TRANSACTIONS MADE OUT OF HIS BANK ACCOUNT AND WERE EXPLAINED DURING THE ASSESSMENT PROCEEDINGS. THERE ARE NO CASH DEPOSITS PRECEDING ANY INVESTMENT MENTIONED HERE. HENCE, I HOLD THAT THESE INVESTMENTS ARE EXPLAI NED AS THEY HAVE BEEN MADE OUT OF THE FUNDS AVAILABLE WIT H THE APPELLANT IN HIS BANK ACCOUNT. HENCE, THE ADDITION MADE BY THE APPELLANT AMOUNTING TO RS.5,00,000/- IS HEREBY IS DELETED. 6. AFTER CONSIDERING THE ARGUMENTS OF BOTH THE SIDES AN D THE FACTS OF THE CASE, WE DO NOT FIND ANY INFIRMITY IN THE ORD ER OF LEARNED CIT(A). THE ASSESSEE IS A RETIRED GOVERNMENT SERVANT WHO WAS SUFFE RING FROM SEVERE HEART AILMENT AND HE HAD A CORONARY SURGERY IN 2005 AT ESCORTS HEART INSTITUTE. HE ALSO SUFFERED WITH CHRONIC KIDNEY DISEASE AND WAS ADVISED A KIDNEY TRANSPLANT. IN VIEW OF THESE FACTS, T HE ASSESSEE KEPT SUFFICIENT FUNDS READILY AVAILABLE WITH HIM. THE SOUR CE OF DEPOSIT IN THE BANK IS EXPLAINED TO BE OUT OF RETIREMENT BENEFITS RECEIVED BY HIM, PAST SAVINGS OF OVER 30 YEARS AND ALSO RECEIPTS FROM HIS TWO SONS WHO WERE WORKING AS PROFESSIONALS IN THEIR RESPECTIVE FIELDS. CONSIDERING THE TOTALITY OF ABOVE FACTS, LEARNED CIT(A) DELETED THE ADDITION OF ` 12,81,000/-. WITH REGARD TO ADDITION OF ` 5,00,000/- WHICH IS THE INVESTMENT IN MUTUAL FUNDS, THE LEARNED CIT(A) HAS FOU ND THAT THE SAME HAS BEEN DEPOSITED FROM HIS BANK ACCOUNT. THE FAC TUAL FINDING RECORDED BY LEARNED CIT(A) HAS NOT BEEN CONTROVERTED BEFORE US. IN THE WRITTEN SUBMISSION, THE ASSESSEE HAS RELIED UPON THE DECISI ON OF HONBLE APEX COURT IN THE CASE OF CIT VS. MRS. P.K.NOO RJAHAN (1999) 237 ITR 570. CONSIDERING THE TOTALITY OF ABOVE FACT S AND THE DECISION ITA-5734/DEL/2011 5 OF HONBLE APEX COURT IN THE CASE OF MRS. P.K.NOORJAH AN (SUPRA), WE DO NOT FIND ANY JUSTIFICATION TO INTERFERE WITH THE ORD ER OF THE CIT(A). THE SAME IS UPHELD AND REVENUES APPEAL IS DISMISSED. 7. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISMISSED . DECISION PRONOUNCED IN THE OPEN COURT ON 15 TH MARCH, 2013. SD/- SD/- ( (( (RAJPAL YADA RAJPAL YADA RAJPAL YADA RAJPAL YADAV VV V) )) ) (G.D.AGRAWAL) (G.D.AGRAWAL) (G.D.AGRAWAL) (G.D.AGRAWAL) JUDICIAL JUDICIAL JUDICIAL JUDICIAL MEMBER MEMBER MEMBER MEMBER VICE PRESIDENT VICE PRESIDENT VICE PRESIDENT VICE PRESIDENT DATED : 15.03.2013 VK. COPY FORWARDED TO: - 1. APPELLANT : INCOME TAX OFFICER, INCOME TAX OFFICER, INCOME TAX OFFICER, INCOME TAX OFFICER, WARD WARD WARD WARD- -- -31(2), NEW DELHI. 31(2), NEW DELHI. 31(2), NEW DELHI. 31(2), NEW DELHI. 2. RESPONDENT : SHRI MAHENDRA KUMAR BHATNAGAR, SHRI MAHENDRA KUMAR BHATNAGAR, SHRI MAHENDRA KUMAR BHATNAGAR, SHRI MAHENDRA KUMAR BHATNAGAR, 7/8, BHAGWAN DAS ROAD, 7/8, BHAGWAN DAS ROAD, 7/8, BHAGWAN DAS ROAD, 7/8, BHAGWAN DAS ROAD, DDA OFFICERS FLATS, NEW DELHI. DDA OFFICERS FLATS, NEW DELHI. DDA OFFICERS FLATS, NEW DELHI. DDA OFFICERS FLATS, NEW DELHI. 3. CIT 4. CIT(A) 5. DR, ITAT ASSISTANT REGISTRAR