ITO 23(2)(3), MUMBAI V. INDIRA VASANT PAREKH, MUMBAI

ITA 5969/MUM/2010

• Counselvise Citation: [2011] 119 COUNSELVISE.COM (IT) 7302 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 2 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-10-2011
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: I
• Assessment Year: 2007-2008
• Appeal Filed On: 30-07-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Unexplained cash credit; Corroborative evidences
• Section: 143(3); 142(1); 68; 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES, I, MUMBAI BEFORE S/SHRI D.K.AGARWAL (JM) AND RAJENDRA SINGH(A .M ) ITA NO.5969/MUM/2010 (ASSESSMENT YEAR : 2007-08) INCOME TAX OFFICER 23(2)(3), C-10/204, 2 ND FLOOR, PRATYAKSHAKAR BHAVAN, BANDRA KURLA COMPLEX, MUMBAI-400051. SMT.INDIRA VASANT PAREKH, 15, MANUSMRUTI, RRT ROAD, MULUND (WEST), MUMBAI-400080 . PAN:AAFPP7478N APPELLANT V/S RESPONDENT DATE OF HEARING : 4.10.2011 DATE OF PRONOUNCEMENT : 7.10.2011 APPELLANT BY : SHRI SUNIL KUMAR SINGH RESPONDENT BY : NONE O R D E R PER D.K.AGARWAL (JM) THIS APPEAL PREFERRED BY THE REVENUE IS DIRECTED AGAINST THE ORDER DATED 14.5.2010 PASSED BY THE LD. CIT(A) FOR THE ASSESSMENT YEAR 2007-08. 2. THE APPEAL WAS FIXED FOR HEARING TODAY I.E.4.10. 2011 AND THE NOTICE OF HEARING WAS SENT TO THE ASSESSEE. DESPITE VALID SERVICE OF NOTICE, AT THE TIME OF HEARING, NO NE WAS PRESENT ON BEHALF OF THE ASSESSEE NOR FILED ANY APP LICATION FOR ADJOURNMENT OF THE CASE. THEREFORE, WE DECIDE T HE APPEAL ITA NO.5969/MUM/2010 (ASSESSMENT YEAR : 2007-08) 2 EX-PARTE, QUA THE ASSESSEE, ON MERITS AFTER HEARI NG THE LEARNED D.R. 3. BRIEFLY STATED FACTS OF THE CASE ARE THAT THE ASSESSEE AN INDIVIDUAL DERIVES INCOME FROM BUSINESS AND OTHE R SOURCES, FILED RETURN DECLARING TOTAL INCOME AT RS .1,84,740/-. THE AO AFTER SELECTING THE CASE FOR SCRUTINY ISSUED NOTICES U/S 143(2) AND 142(1) OF THE INCOME TAX ACT, 1961(I N SHORT THE ACT) . HOWEVER, THERE WAS NO COMPLIANCE BY THE ASSESSEE. THE AO OBSERVED THAT ON THE BASIS OF AIR INFORMATION THERE WAS A DEPOSIT OF RS.11,17,620/- IN THE SAVING BANK ACCOUNT WITH SYNDICATE BANK, MULUND B RANCH BY THE ASSESSEE. THE ASSESSEE WAS ASKED TO EXPLAIN THE SOURCE OF CASH DEPOSITS IN THE BANK ACCOUNT. IN THE ABSENCE OF ANY EXPLANATION, THE AO TREATED THE SAID BANK DEPOSIT OF RS.11,17,620/- AS UNEXPLAINED CASH CREDIT U/S 68 O F THE ACT AND ACCORDINGLY COMPLETED THE ASSESSMENT AT AN INCO ME OF RS.13,02,360/- VIDE ORDER DATED 11.11.2009 PASSED U /S 144 OF THE ACT. ON APPEAL, THE LD. CIT(A) CALLED FOR THE REMAND REPORT FROM THE AO. HOWEVER, IN THE ABSENCE OF ANY DISCUSSION ON THE IMPUGNED ISSUE, THE LD. CIT(A) AF TER CONSIDERING THE MATERIAL AVAILABLE ON RECORD, DELET ED THE ADDITION MADE BY THE AO. ITA NO.5969/MUM/2010 (ASSESSMENT YEAR : 2007-08) 3 4. BEING AGGRIEVED BY THE ORDER OF THE LD.CIT(A), T HE REVENUE IS IN APPEAL BEFORE US TAKING FOLLOWING GR OUNDS OF APPEAL: 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) ERRED IN DELETING THE ADDITION OF RS.11,17,620/- AND IN ALLOWING THE APPEAL OF THE ASSESSEE; 2. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND I N LAW, THE LD. CIT(A) ERRED IN ADMITTING FRESH EVIDE NCE WITHOUT GIVING OPPORTUNITY TO THE AO TO CROSS VERI FY THOSE, AND THEREBY ACTED CONTRARY TO THE PROVISION OF RULE 46A OF THE I.T. RULES, 1962 5. AT THE TIME OF HEARING, THE LD. DR SUBMITS THAT SINCE THE ASSESSEE HAS FAILED TO EXPLAIN THE SOURCE OF DEPOSI TS OF RS.11,17,620/- BEFORE THE AO, THE LD. CIT(A) WAS NO T JUSTIFIED IN DELETING THE SAME. HE, THEREFORE, SUBMITS THAT T HE ADDITION MADE BY THE AO BE RESTORED. 6. HAVING CAREFULLY HEARD THE SUBMISSIONS OF THE LD .DR AND PERUSING THE MATERIAL AVAILABLE ON RECORD WE F IND THAT THERE IS NO DISPUTE THAT BEFORE THE AO, THE ASSESS EE NEITHER ATTENDED THE DATE OF HEARING NOR FILED ANY EXPLANAT ION ABOUT THE NATURE AND SOURCE OF BANK DEPOSITS OF RS.11, 17,620/-. WE FURTHER FIND THAT BEFORE THE LD. CIT(A), THE ASS ESSEE HAS FILED THE DETAILED EXPLANATION ALONG WITH THE SUPP ORTING MATERIAL WHICH IS REPRODUCED AS UNDER (PARA 7.3 OF CIT(A)S ORDER): ITA NO.5969/MUM/2010 (ASSESSMENT YEAR : 2007-08) 4 A. SMT. INDIRA VASANT PAREKH IS OLD LADY OF 7 0 YEARS; B. SHE IS SUFFERING FROM ILLNESS LIKE AILMENT OF HEART, DIABETES AND HYPERTENSION IN FACT UNDERGONE CORONARY BYPASS SURGERY IN THE YEAR 2001; C. SHE HAS RELIED ON CA AND NOT ATTENDED ANY OPPORTUNITY GIVEN BY THE ITO EVEN ALL CASH DEPOSITED SOURCE WAS GENUINE; D. IN FACT SHE HAS RECEIVED TEMPORARY MEDICAL HELP FROM TIME TO TIME HER SON IN LAW ANIL JASANI HAVING PROPRIETOR BUSINESS I.E ANIL DYE CHEM CORPORATION; E. SHE HAS RECEIVED RS.I0,41,075/- FROM TIME TO TIME DEPOSITED IN HER SB ACCOUNT MAINTAINED WITH SYNDICATE BANK MULUND BRANCH; F. THIS NEAR RELATION HELP TAKEN AFTER GIVING OLD ANCESTOR JEWELLERY AS MORTGAGED AS PER MUTUAL UNDERSTANDING; G. AFTER SOMETIME, SHE HAS RETURNED MONEY BY CROSS CHEQUE TO SON IN LAW AND RECEIVED MORTGAGED JEWELLERY. THERE IS NO OUTSTANDING BALANCE AS ON 31.3.2007; H. WE ARE ENCLOSING PROOF FOR SOURCE AS UNDER; I. RETURN COPY ANIL JASANI PROP OF ANIL DYE CHEM. II. SCRUTINY ASSESSMENT ORDER ASSESSMENT YEAR 2007-08; III. EXTRACT OF CASH BOOK DATE WISE FROM 1,4.2006 TO 31.3.2007 ; IV. LEDGER ACCOUNT SRNT INDIRA VASANT PARAKH IN THE BOOKS OF ANIL DYE CHEM; V. CERTIFICATE FROM ANIL DYE CHEM; I. ON THE ABOVE MATTER SHE HAS EXPLAINED THE SOURCE OF CASH DEPOSITED AND RETURNED THE MONEY TO ANIL DYE CHEM; ITA NO.5969/MUM/2010 (ASSESSMENT YEAR : 2007-08) 5 J. AFFIDAVIT DATED 22.4.2010 ENCLOSED; K. AS PER SCRUTINY ORDER ITO HAS ADDED AS CASH CREDIT U/S 68 AMOUNT RS.11,17,620/- AS PER CASH DEPOSITED DURING THE YEAR ; AND L. AS EXPLAINED ABOVE, RS.1041075/- RECEIVED FROM ANIL DYE CHEM AND BALANCE RS. 76545/- DEPOSITED OUT OF INCOME DURING THE YEAR; YOU ARE REQUESTED TO DELETE THE ADDITION U/S 68 OF RS.11,17,620/-. IN VIEW OF THE FOREGOING SUBMISSION, THE APPELLANT PRAYS THAT SUCH AN INVALID ASSESSMENT ORDER BE QUASHED AS NULL AND VOID AND THE ADDITION MADE THEREIN BE DELETED. OR IN MERITS, WITHOUT PREJUDICE ON LEGAL GROUND, THE ADDITION MADE THEREIN BE DELETED WE FURTHER FIND THAT THE LD. CIT(A) REMANDED THE M ATTER TO THE AO. IT HAS BEEN OBSERVED BY THE LD. CIT(A) IN PARAGRAPHS 7.2 OF THE ORDER THAT IN THE REMAND REP ORT SENT BY THE AO, THERE IS NO DISCUSSION ON THE IMPUGNED ISS UE AT ALL. WE FURTHER FIND THAT THE LD. CIT(A) AFTER CONSIDERI NG THE ASSESSEES SUBMISSIONS HAS DELETED THE IMPUGNED ADD ITION VIDE FINDING RECORDED IN PARAGRAPHS 7.4 OF HIS ORDE R WHICH IS REPRODUCED AS UNDER(LAST PAGE) : 7.4 I HAVE CAREFULLY CONSIDERED THE ORDER OF THE ASSESSING OFFICER AND THE SUBMISSIONS MADE BY THE APPELLANT ALONG WITH THE SUPPORTING EVIDENCES. I FI ND THAT THE CONTENTION OF THE APPELLANT CAN BE ACCEPTED. IT IS SEEN THAT THE APPELLANT IS AGED 70 AND THEREFORE IT CANNOT BE DOUBTED THAT SHE COULD BE TROUBLED BY ILL NESS MENTIONED IN HER SUBMISSION. THE APPELLANT HAS ALRE ADY AT THE TIME OF FILING OF APPEAL SUBMITTED EVIDENCE OF ILL HEALTH. THEREFORE, THIS CONTENTION OF ILL HEALTH CA NNOT BE OVERLOOKED OR REJECTED. THE APPELLANT, I FIND HAS F URTHER CONTENDED THAT DUE TO HER ILL HEALTH SHE WAS AT TI MES ITA NO.5969/MUM/2010 (ASSESSMENT YEAR : 2007-08) 6 REQUIRED TO SEEK FINANCIAL ASSISTANCE (WHICH AMOUNT ED TO RS. 10,41,075/-) FROM HER SON IN LAW. SHE HAS ALSO FILED DETAILS OF THE MONEY RECEIVED FROM TIME TO TIME AN D THE REPAYMENT EFFECTED BY HER. IT IS SEEN THAT HER ACCO UNT CLEARLY REFLECT AN OUTSTANDING BALANCE OF RS.74,125 /- AND DEPOSIT OF RS.10,41,075/- FROM SHRI ANIL RAMNIKAL J ASANI WHO IS HER SON-IN-LAW AND PROPRIETOR OF THE CONCERN ANIL DYE CHEM CORPORATION. IT IS ALSO SEEN THAT THE BOOK S OF ACCOUNTS OF SHRI JASANI FOR ASSESSMENT YEAR 2007-08 DULY REFLECT THE TRANSACTIONS AND THAT THE ASSESSIN G OFFICER IN THE CASE OF SHRI JASANI HAS ACCEPTED THE SAME IN HIS ORDER FOR ASSESSMENT YEAR 2007-08 DATED 31.12.2007 PASSED U/S 143(3) OF THE I.T ACT, 1961. NORMALLY THIS FINANCIAL HELP WOULD BE TERMED AS A L OAN. HOWEVER IN THE CASE OF THE APPELLANT, I FIND THAT S HE HAS TAKEN THE HELP FROM HER SON-IN-LAW BY MORTGAGING H ER JEWELLERY WITH HIM AS STATED IN THE ACCOUNTS ITSEL F. BEFORE DISMISSING THIS STATEMENT, ONE NEEDS TO SEE THE PSYCHOLOGY OF THE APPELLANT HERE. IT IS SEEN THAT T HE AGED APPELLANT NEEDED HELP, REQUESTED IT FROM HER SON-I N-LAW BUT NOR WANTING TO BE BEHOLDEN TO HIM, MORTGAGED HE R JEWELLERY WITH HIM WHICH SHE RECEIVED BACK ON REPAY MENT OF MONEY DUE. I AM INCLINED TO ACCEPT THIS AND I F IND FROM THE DOCUMENTS FILED BEFORE ME, IT IS CLEAR T HAT THE FINANCIAL AID RECEIVED WAS NOT IN FORM OF LOAN BU T VALUE OF MORTGAGED JEWELLERY. AS THE SOURCE OF CASH DEPO SITED IN THE BANK ACCOUNT, MAINTAINED WITH SYNDICATE BANK , MULUND BRANCH STANDS CLEARLY PROVED BY WAY OF DOCUMENTS, THE ADDITION MADE BY THE ASSESSING OFFIC ER U/S 68 OF THE IT ACT, 1961 TREATING THE SAME AS UNEXPLAINED CASH CREDIT DOES NOT SURVIVE AND IS THE REFORE DELETED. IN THE ABSENCE OF ANY CONTRARY MATERIAL BROUGHT ON RECORD BY THE REVENUE AGAINST THE FINDING OF THE LD. CIT(A) A ND KEEPING IN VIEW THAT THE LD. CIT(A) HAS COMPLIED WITH THE R ELEVANT PROVISION OF RULE 46A OF THE INCOME TAX RULES, 19 62 AND ALSO KEEPING IN VIEW THAT IN THE CASE OF SHRI ANI L RAMNIKAL JASANI, SON-IN-LAW AND PROPRIETOR OF THE CONCERN AN IL DYE CHEM CORPORATION, THE AO HAS ACCEPTED THE CORRESPO NDING ITA NO.5969/MUM/2010 (ASSESSMENT YEAR : 2007-08) 7 TRANSACTIONS AS GENUINE, WE ARE OF THE VIEW THAT TH E LD. CIT(A) WAS FULLY JUSTIFIED IN DELETING THE ADDITIO N OF RS.11,17,620/- MADE BY THE AO U/S 68 OF THE ACT. T HE GROUNDS TAKEN BY THE REVENUE ARE, THEREFORE, REJEC TED. 7. IN THE RESULT, THE REVENUE APPEAL STANDS DISMIS SED. ORDER PRONOUNCED IN THE OPEN COURT ON 7TH OCTOBER,2011. SD SD (RAJENDRA SINGH) (D .K.AGARWAL) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI, DATED 7TH OCTOBER, 2011 SRL: COPY TO: 1. APPELLANT 2. RESPONDENT 3. CIT CONCERNED 4. CIT(A) CONCERNED 5. DR CONCERNED BENCH 6. GUARD FILE. TRUE COPY BY ORDER ASSTT. REGISTRAR, ITAT, MUMBAI