JAYESH DAMANIA, MUMBAI V. ITO 25(3)(2), MUMBAI

ITA 5952/MUM/2009

• Counselvise Citation: [2011] 140 COUNSELVISE.COM (IT) 55229 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 10 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-09-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: I
• Next Hearing Date: 25-08-2011
• Assessment Year: 2005-2006
• Appeal Filed On: 09-11-2009
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: VIJAY KOTHARI
• Keywords: Revised return

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI I BENCH BEFORE SHRI N.V.VASUDEVAN, JUDICIAL MEMBER & SHRI T.R.SOOD, ACCOUNTANT MEMBER I.T.A.NO.5952/MUM/2009 A.Y 2005-06 MR. JAYESH DAMANIA, A 606, CRYSTAL AVENUE, THAKUR VILLAGE, KANDIVALI (E), MUMBAI 400 001. AAGPD 8969 H VS. THE INCOME TAX OFFICER -25(3)(2), MUMBAI. (APPELLANT) (RESPONDENT) APPELLANT BY : MR. VIJAY KOTHARI. RESPONDENT BY : MR. SUNIL KUMAR SINGH. DATE OF HEARING: 25/08/2011 DATE OF PRONOUNCEMENT: 9/9/2011 O R D E R PER T.R.SOOD, AM: IN THIS APPEAL ASSESSEE HAS RAISED VARIOUS GROUNDS THROUGH WHICH ADDITIONS CONFIRMED TO THE EXTENT OF RS.16,20 ,712/- HAVE BEEN CHALLENGED. THE ADDITIONS HAVE BEEN FINALLY CONFIRM ED BY THE CIT(A) VIDE PARA 4.25 WHICH IS AS UNDER: 4.25 IN THE RESULT, ADDITION RELATING TO THE CREDI T ENTRIES TO THE EXTENT OF RS.16,20,712/- (RS.1,64,800 + RS.1,38,001 + RS.20,000 + RS.11,71,408 + RS.782 IS CONFIRMED. THE ASSESSING O FFICER IS DIRECTED TO DELETE THE REMAINING ADDITION OF RS.17,07,581/- (RS.33,28,292 RS.16,20,712). THE GROUND OF APPEAL NO.2 TO 6 ARE T HEREFORE, PARTLY ALLOWED. 2. OUT OF THE ABOVE ADDITIONS CONSISTING OF RS.1,38 ,001 + RS.20,000 + RS.782 WERE NOT PRESSED BEFORE US, THER EFORE, SAME ARE CONFIRMED. IN RESPECT OF THE OTHER ADDITIONS, THE F IRST ADDITION WAS OF RS.1,64,800/- AND THE MAIN CONTENTION WAS THAT THIS SHOULD HAVE BEEN ITA NO.5952 OF 09 2 SET OFF AGAINST THE VARIOUS CASH WITHDRAWALS IMMEDI ATELY BEFORE SUCH CASH DEPOSITS AND REFERENCE WAS MADE TO THE BANK ST ATEMENT. IT WAS ALSO POINTED OUT THAT SIMILAR RELIEF WAS ALLOWED IN EARLIER YEARS BY THE TRIBUNAL IN I.T.A.NOS.1947 & 1948/MUM/2010. AGAINST THE OTHER ADDITIONS, IT WAS MAINLY SUBMITTED THAT SUCH DEPOSI TS WERE ALSO OUT OF LOANS EARLIER GRANTED WHICH HAVE BEEN RETURNED FROM ENCASHMENT OF SOME MUTUAL FUNDS OR SUCH OTHER SOURCES. WHEN THE L D. COUNSEL OF THE ASSESSEE WAS CONFRONTED THAT WHAT WAS THE SOURCE OF SUCH LOANS, HE SUBMITTED THAT SAME CAN BE EXPLAINED BY PREPARING A CASH FLOW STATEMENT AND STATEMENT OF AFFAIRS FOR VARIOUS YEAR S AND, THEREFORE, HE REQUESTED THAT MATTER MAY BE SET ASIDE AND HE IS RE ADY TO FURNISH THESE STATEMENTS AND EXPLAIN THE SOURCE. 3. ON THE OTHER HAND, LD. DR STRONGLY SUPPORTED THE ORDER OF THE CIT(A). 4. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS CAREFUL LY AND FIND THAT WHEN THE ISSUES CAME UP FOR CONSIDERATION BEFORE TH E TRIBUNAL FOR A.YRS.2003-04 AND 2004-05, AS FAR AS ISSUE REGARDIN G CASH DEPOSIT IS CONCERNED RELIEF WAS GIVEN BY CONFIRMING THE ORDER OF THE LD. CIT(A) VIDE PARA-7 WHICH IS AS UNDER: 7. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS CAREFU LLY AND FIND FORCE IN THE SUBMISSIONS OF THE LEARNED COUNSEL FOR THE A SSESSEE. ASSESSEE IS STATED TO BE ONLY A PART-TIME ACCOUNTANT AND IS NOT REQUIRED TO MAINTAIN ANY BOOKS OF ACCOUNT. EVEN AS PER SECTION 44AA ONLY PROFESSIONALS LIKE ADVOCATES, ENGINEERS, ARCHITECTS , CHARTERED ACCOUNTANTS, INTERIOR DECORATORS OR ANY OTHER PROFE SSIONALS NOTIFIED BY THE BOARD WERE REQUIRED TO MAINTAIN BOOKS. IN ANY C ASE THE A.O. HAS HIMSELF ACCEPTED THE REVISED RETURN FOR A.Y. 2002-0 3 WHEREIN INITIAL DEPOSIT OF ABOUT `5 LAKHS WAS MADE IN THE ORIENTAL BANK OF COMMERCE ACCOUNT. A PERUSAL OF CIT(A)S ORDER, WHEREIN HE HA S EXTRACTED THE ITA NO.5952 OF 09 3 SUMMARY OF ACCOUNTS CLEARLY SHOWS THAT LATER ON MON EY HAS BEEN FIRST DRAWN AND THEN REDEPOSITED IN THE BANK AND THEREFOR E IT IS A MERE CASE OF ROTATION OF SAME MONEY. IN FACT BEFORE THE A.O., VIDE LETTER DATED 01.12.2008, IT WAS CLEARLY STATED AS UNDER: - 3. AS PER THE CASH ACCOUNT ENCLOSED YOU WILL OBSER VE THAT DURING A.Y. 2002-03 THE AMOUNT OF CASH DEPOSITED IN THE BANK AC COUNT WAS RS.11,43,679/- AND THE AMOUNT OF CASH WITHDRAWN WAS RS.12,71,800/- . SIMILARLY FOR A.Y. 2003-04 THE AMOUNT OF CASH DEP OSITED IN THE BANK ACCOUNT WAS RS.10,55,800/- AND THE AMOUNT OF CASH W ITHDRAWN WAS RS.5,97,060 AND FOR A.Y. 2004-05 THE AMOUNT OF CASH DEPOSITED IN THE BANK ACCOUNT WAS RS.8,33,350/- AND THE AMOUNT OF C ASH WITHDRAWN WAS RS.9,67,685/-. FROM THIS YOU WILL OBSERVE THAT OUT OF THE 3 YEARS, I HAD WITHDRAWN MORE CASH FROM THE BANK THAN WAS DE POSITED. FOR A.Y. 2002-03 THE EXCESS WITHDRAWN WAS RS.1,38,121 AND FOR A.Y. 2004-05 THE EXCESS WITHDRAWN WAS RS.1,34,335/-. FOR A.Y. 2003-04 AFTER CONSIDERING THE EXCESS CASH WITHDRAWN DURING A.Y. 2002-03, THE EXCESS DEPOSITED WAS ONLY RS.3,30,619/-. THIS CASH WAS FORM MY ACCUMULATED SAVINGS AND THE AMOUNT RECEIVED FROM MY FATHER AS STATED ABOVE. 5. AS FAR AS THE SOURCE FOR DEPOSITS FROM REFUND OF LOAN OR OTHER SOURCES IS CONCERNED, IN THE ABSENCE OF ALL DETAILS IT IS NOT POSSIBLE TO VERIFY THE SAME BY US. THEREFORE, IN THE INTERESTS OF JUSTICE, WE SET ASIDE THE ORDER OF THE LD. CIT(A) AND REMIT THE MAT TER BACK TO THE FILE OF THE AO WITH A DIRECTION TO RE-EXAMINE THE SOURCE OF DEPOSITS WITH REFERENCE TO THE SOURCES WHICH MAY BE EXPLAINED THR OUGH STATEMENT OF AFFAIRS AND CASH FLOW STATEMENT BEFORE THE AO. NEED LESS TO SAY THAT ASSESSEE SHOULD BE GIVEN AN ADEQUATE OPPORTUNITY FO R EXPLAINING HIS CASE. 6. IN THE RESULT, APPEAL IS PARTLY ALLOWED FOR STAT ISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON THIS DAY OF 9/9/2011. SD/- SD/- (N.V.VASUDEVAN) (T.R.SOOD) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI: 9/9/2011.