Sh. Gurbhej Singh S/O Major Singh, Fazilka V. The Income Tax Officer, Abohar

ITA 599/ASR/2015

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 7735 (ITAT-AMRITSAR)
• Duration Of Justice: 1 year(s) 11 month(s) 14 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-10-2017
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2009-2010
• Appeal Filed On: 16-11-2015
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Assessee Lawyers: P N ARORA LD
• Section: 133(6); 69; 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH; AMRITSAR BEFORE SH. T.S. KAPOOR, ACCOUNTANT MEMBER AND SH. N.K.CHOUDHRY, JUDICIAL MEMBER I.T.A NO.599(ASR)/2015 ASSESSMENT YEAR:2009- 10 SH. GURBHEJ SINGH, S/O MAJOR SINGH, CIVIL LINES, PHASE-2, FAZILKA. PAN:CBEPS-9961H VS. INCOME TAX OFFICER, WARD-2(4), ABOHAR. (APPELLANT) (RESPONDENT) APPELLANT BY: SH. P. N. ARORA (LD. ADV .) RESPONDENT BY: SH. RAHUL DHAWAN (D.R) DATE OF HEARING: 06.09.2017 DATE OF PRONOUNCEMENT: 31.10.2017 ORDER PER N.K.CHOUDHRY (JM): THE INSTANT APPEAL HAS BEEN PREFERRED BY THE ASSESSEE, ON FEELING AGGRIEVED AGAINST THE ORDER DATED 22.09.201 5 PASSED IN APPEAL NO.243-IT/CIT(A)/BTI/11-12, RELEVANT TO THE ASST. YEA R:2009-10 BY CIT(A)- BATHINDA. 2. THE BRIEF FACTS OF THE CASE ARE AS UNDER: THE APPELLANT IS AN INDIVIDUAL BY THE NAME, SH. GURB HEJ SINGH, S/O SH. MAJOR SINGH HAD FILED HIS RETURN OF I NCOME OF RS.1,16,450/- FOR ASST YEAR:-2009-10. THE RETURNED INCO ME WAS PURPORTED TO BE FROM SALE OF MILK. THE APPELLANTS CAS E WAS SELECTED FOR SCRUTINY ON THE BASIS OF AIR INFORMATION REG ARDING CASH DEPOSITS EXCEEDING 10 LAKHS IN THE SAVING ACCOUNT MAINTAINED IN ALLAHABAD BANK, FAZILKA. THE ASSESSING OF FICER PROCURED A COPY OF THE BANK ACCOUNT OF THE APPELLANT BY ISSUANCE OF NOTICE UNDER SECTION 133(6) OF THE INCOME TAX ACT, 19 61 ITA NO.599 (ASR)/2015 ASST. YEAR : 2009-10 2 (HEREINAFTER, THE ACT) TO THE BRANCH MANAGER OF THE ALLAHABAD BANK, WHEREUPON IT WAS NOTICED THAT THE APPELLANT HAD DEPOSITED RS.31,05,000/-, RS.10,000/-, AND RS.1,000/- ON VARIOUS DATES DURING THE PERIOD UNDER CONSIDERATION. THE ASSESSING OFFI CERS QUERY REGARDING THE SOURCES OF SUCH DEPOSITS IN THE BANK ACCOUNT MET WITH NO RESPONSE FROM THE APPELLANT, RESULTING IN AN EX- PARTE ASSESSMENT, WHEREBY THE ENTIRE AMOUNT OF RS.31,15,000/- WAS ADDED TO THE INCOME OF THE APPELLANT UNDER THE PR OVISIONS OF SECTION 69 OF THE ACT. BESIDES THE SAID ADDITION, INCOME FROM SALE OF MILK WAS ALSO MODERATELY ENHANCED FROM RS.1,16,4 50/- TO RS.1,50,000/-. THE RESULTANT TAX DEMAND, PURSUANT T O THE AFORESAID ADDITION, STOOD AT RS.13,02,770/-. 3. FEELING AGGRIEVED AGAINST THE EX-PARTE ASSESSMENT ORDE R DATED 12 TH SEP. 2011, THE ASSESSEE FILED THE FIRST APPEAL BEFORE T HE LD. CIT(A), WHO PARTLY ALLOWED THE APPEAL OF THE ASSESSEE B Y DELETING THE ADDITION OF RS.5,68,000/- AND RS.10,00,000/-, HOWEVER , CONFIRMED THE ADDITION TO THE EXTENT OF RS.15,47,000/-. 4. THE ASSESSEE CHALLENGED THE ORDER PASSED BY THE LD. CIT (A) BY RAISING THE ONLY GROUND OF APPEAL WHICH IS REPRODUCED A S UNDER: THAT THE LEARNED CIT(A) ERRED ON FACTS AND LAW IN CONFIRMING THE ADDITION OF RS.15,47,000/- MADE BY THE AO ON ACCOUN T OF THE ALLEGED FAILURE OF THE ASSESSEE TO PROVE THE SOURCE OF CASH DEPOSIT IN HIS SAVING BANK ACCOUNT WITH ALLAHABAD BANK, FAZILK A. THE ASSESSEE ALSO RAISED THE ADDITIONAL GROUND OF APPEAL. THAT IN THIS CASE THE ADDITION OF RS.31,15,000/- H AS BEEN MADE BY INVOKING THE PROVISIONS OF SECTION 69 OF THE I.T. A CT, 1961. THE PROVISIONS OF SEC.69 ARE NOT AT ALL APPLICABLE TO T HE PRESENT FACTS AND CIRCUMSTANCES OF THE CASE. AS SUCH THE ADDITION MAD E IS UNJUSTIFIED, ITA NO.599 (ASR)/2015 ASST. YEAR : 2009-10 3 UNCALLED FOR AND THE ADDITION MADE ON THIS SCORE MA Y BE DELETED AS THE SAME IS ILLEGAL, INVALID AND VOID AB INITIO IN THE EYES OF LAW. THE ASSESSEE IN SUPPORT OF ITS CASE SUBMITTED THAT WHILE COM PLETING THE ASSESSMENT, THE AO MADE ADDITION OF RS.31,15,000/- B Y INVOKING THE PROVISIONS OF SEC.69 OF THE I.T. ACT, 1961 AND OUT OF THIS ADDITION, THE WORTHY CIT(A) ALLOWED THE BENEFIT OF RS.15,68,00 0/- AND SUSTAINED THE ADDITION OF RS.15,47,000/- AGAINST WHICH THE ASSESSE E HAS PREFERRED THE INSTANT APPEAL. IT IS SUBMITTED THAT IN THE INSTANT CASE, THE ADDITION WAS MADE BY INVOKING THE PROVISIONS OF SEC.69 OF THE I.T. ACT WHICH LEGALLY AT ALL NOT APPLICABLE TO THE PRESENT FACTS AND CIRCUMSTANCES OF THE CASE BECAUSE ADMITTEDLY THE ASSESSEE WAS NOT MAINTAINING ANY BOOKS OF ACCOUNTS AND AS SUCH THE PROVISION S OF SEC.69 PRESUPPOSES FOLLOWING TWO INGREDIENTS (I) THAT T HE BOOKS OF ACCOUNTS SHOULD BE MAINTAINED (II) THAT THE INVESTMENT SH OULD BE MADE OUTSIDE OF THE BOOKS OF ACCOUNTS. SINCE, IN THE INSTA NT CASE, NO BOOKS OF ACCOUNTS HAS BEEN MAINTAINED, THEREFORE, THE PR OVISIONS OF SEC.69 ARE NOT APPLICABLE AND THIS VIEW FINDS SUPPORT F ROM THE DECISION OF ITAT, AMRITSAR BENCH, IN THE CASE OF AMARJIT SINGH, IN ITA NO.114(ASR)/2015 VIDE ORDER DATED 14.12.2015 RELATIN G TO ASST. YEAR 2011-12. ALTERNATIVELY, IT WAS ARGUED BY THE LD. AR THAT ON MERITS, NO ADDITION CAN BE MADE, IN VIEW OF THE WHOLE DISCUSSION W HICH HAS BEEN MADE IN PARA NO.7 ON PAGE 6 &7 OF THE ORDER OF WORT HY CIT(A). IT WAS ARGUED BEFORE THE AUTHORITIES BELOW THAT ONE OF THE FRIEND OF THE ASSESSEE SH. SUKHDEV SINGH HAS SOLD HIS AGRICULTURAL LAND FOR AN AMOUNT OF RS.16,30,000/- WHICH WAS GIVEN BY HIM TO TH E ASSESSEE FOR SAFE KEEPING, THE SAME IN HIS BANK ACCOUNT WHICH WAS SUBSE QUENTLY RETURNED BACK TO SH. SUKHDEV SINGH ON 20.01.2009 AND THESE FACTS HAVE BEEN DULY ADMITTED BY SH. SUKHDEV SINGH IN THE REMAND PROCEEDING DATED 18.03.2015, THEREFORE, IN VIEW OF T HE CIRCUMSTANCES, THE LD. CIT(A) WAS NOT AT ALL JUSTIFIED IN CONFIRMIN G THE ADDITION OF ITA NO.599 (ASR)/2015 ASST. YEAR : 2009-10 4 RS.15,45,000/- AS THE SAME HAS BEEN MADE PURELY ON THE BASIS OF CONJECTURE, SURMISES AND SUPPOSITIONS. 5. ON THE OTHER HAND, THE LD. DR RELIED UPON THE ORDER PASSED BY THE LD. CIT(A) AND SUBMITTED THAT THE CONTENTION OF T HE ASSESSEE TO THE EFFECT THAT NO ADDITION CAN BE MADE U/S 69 OF THE ACT HAVING NO LEGS TO STAND IN LAW AND THE PROPOSITION OF THE LD. AR IS CONTRARY TO THE PROVISIONS OF SEC.69 OF THE ACT. 6. WE HAVE GONE THROUGH WITH THE FACTS AND CIRCUMSTANCES OF THE CASE, AS IT REFLECTS FROM THE ASSESSMENT ORDER THAT MORE TH AN 10 OPPORTUNITIES HAVE BEEN GIVEN TO THE ASSESSEE FOR JOININ G THE ASSESSMENT PROCEEDINGS, HOWEVER, THE ASSESSEE DID NOT CO-OPE RATE IN THE ASSESSMENT PROCEEDINGS AND FINDING NO OPTION, THE ASSESSI NG OFFICER WAS CONSIDERED TO COMPLETE THE ASSESSMENT U/S 144 OF THE I.T. ACT ON THE BASIS OF INFORMATION AND MATERIAL AVAILABLE ON RECORD. AS THE ASSESSEE HAS FAILED TO OFFER ANY EXPLANATION IN RESPE CT OF CASH DEPOSIT OF RS.31,15,000/- IN HIS SAVING ACCOUNT NO.4512 M AINTAINED BY HIM WITH THE ALLAHABAD BANK, FAZILKA ON 06.01.2009, THEREFORE, THE VALUE OF THE DEPOSIT OF RS.31,15,000/- WAS TREATED AS I NCOME OF THE ASSESSEE FOR THE YEAR UNDER CONSIDERATION U/S 69 OF THE I. T. ACT. ON APPEAL, THE LD. CIT(A) DELETED THE SOME OF THE A DDITION, HOWEVER, SUSTAINED THE ADDITION OF RS.15,47,000/-. IT IS NOT OUT TO PLACE HEREIN THAT THE ASSESSEE NEVER RAISED OBJECTION WITH REGARD TO THE NON-APPLICABILITY OF PROVISIONS OF SEC.69 IN THE F ACTS AND CIRCUMSTANCES OF THE INSTANT CASE BEFORE THE LD. CIT(A). TH E ASSESSEE HAS ALREADY GOT THE RELIEF OF RS.5,68,000/- AND RS.10, 00,000/-, HOWEVER, BY RAISING ADDITIONAL GROUND CHALLENGED THE WHOLE ADDITION OF RS.31,15,000/-. LET US TO PERUSE THE INGREDIENTS OF SEC. 69. ITA NO.599 (ASR)/2015 ASST. YEAR : 2009-10 5 WHERE IN THE FINANCIAL YEAR IMMEDIATELY PRECEDING THE ASSESSMENT YEAR THE ASSESSEE HAS MADE INVESTMENTS WHICH ARE NO T RECORDED IN THE BOOKS OF ACCOUNT, IF ANY, MAINTAINED BY HIM FOR ANY SOURCE OF INCOME, AND THE ASSESSEE OFFERS NO EXPLANATION ABOUT THE NA TURE AND SOURCE OF THE INVESTMENTS OR THE EXPLANATION OFFERED BY HIM I S NOT, IN THE OPINION OF THE [ASSESSING] OFFICER, SATISFACTORY, T HE VALUE OF THE INVESTMENTS MAY BE DEEMED TO BE THE INCOME OF THE A SSESSEE OF SUCH FINANCIAL YEAR. FROM THE PLAIN READING OF SEC.69, IT REFLECTS THAT IT IS NOT MANDATORY TO MAINTAIN THE BOOKS OF ACCOUNTS. THE INGRE DIENTS OF SEC.69 REFLECTS THAT WHERE IN THE FINANCIAL YEAR IMMEDI ATELY PRECEDING THE ASSESSMENT YEAR THE ASSESSEE HAS MADE INVESTMENT WHICH ARE NOT RECORDED IN THE BOOKS OF ACCOUNT, IF ANY, MAINTAINED BY HIM FOR ANY SOURCE OF INCOME. IF ANY CLASSIFIES THAT FOR APPLICATION O F SEC.69 IT IS NOT MANDATORY TO MAINTAIN THE BOOKS OF ACCOUNTS AND THE REFORE, IT CANNOT BE SAID THAT SEC.69 PRESUPPOSES TWO CONDITIONS (I) T HAT THE BOOKS OF ACCOUNT SHOULD BE MAINTAINED (II) THAT THE INV ESTMENT SHOULD BE MADE OUTSIDE THE BOOKS OF ACCOUNT. SEC.69 FURTHER CLASSI FIES THAT IF THE ASSESSEE OFFERS NO EXPLANATION ABOUT THE NATURE AND SOURCE OF INVESTMENT OR THE EXPLANATION OFFERED BY HIM, IN THE OPINION OF THE ASSESSING OFFICER NONSATISFACTORY, THE VALUE OF INVESTMENT MAY BE DEEMED TO BE THE INCOME OF THE ASSESSEE OF SUCH FINANCIAL Y EAR WHICH IN SIMPLE MEANING COVERS TWO SITUATIONS (I) WHERE THE ASSE SSEE OFFERS NO EXPLANATION ABOUT THE NATURE AND SOURCE OF INVESTM ENT AND (II) THE EXPLANATION OFFERED BY HIM IS NOT, IN THE OPINION OF THE ASSESSING OFFICER, SATISFACTORY, IN THAT SITUATION THE VALUE OF T HE INVESTMENTS MAY BE DEEMED TO BE THE INCOME OF THE ASSESSEE OF SUCH FIN ANCIAL YEAR. EVEN OTHERWISE, SEC.69A FURTHER CLARIFIES ABOUT THE UN EXPLAINED MONEY AND CRUX OF THAT SECTION REFLECTS THAT THE MONEY AND VALUE OF THE BILLION, JEWELLERY OR OTHER VALUABLE ARTICLE, IF ASSESSEE OFFERS NO EXPLANATION ABOUT THE NATURE AND SOURCE OF ACQUISITION OR THE ITA NO.599 (ASR)/2015 ASST. YEAR : 2009-10 6 EXPLANATION OFFERED BY HIM IS NOT IN THE OPINION OF THE ASSESSING OFFICER SATISFACTORY THEN THE SAME MAY BE DEEMED TO BE T HE INCOME OF THE ASSESSEE FOR SUCH FINANCIAL YEAR. THE CASE CITED BY THE LD. AR TITLED AS AMARJIT SINGH VS. ITO (SUPRA) IS FACTUALLY DISSIMILAR T O THE INSTANT CASE AND NOT BASED UPON ANY PRECEDENT AND COGENT REASONS, THEREFORE, NOT APPLICABLE TO THE INSTANT CASE. HENCE, IN OVER ALL CONSIDERATION, THE ADDITIONAL GROUNDS RAISED BY THE ASSESSE E STANDS DISMISSED. NOW COMING TO THE ALTERNATIVE PLEA OF THE ASSESSEE THAT ONE OF THE FRIEND NAMELY SH. SUKHDEV SINGH OF THE ASSESSEE HAS SOLD HIS AGRICULTURAL LAND FOR AN AMOUNT OF RS.16,30,000/- WHI CH WAS GIVEN BY HIM TO THE ASSESSEE FOR SAFE KEEPING IN HIS BANK ACCOUNT O N 06.01.2009 AND THE SAME WAS RETURNED ON 20.01.2009 D OES NOT SOUNDS TO BE SATISFACTORY EXPLANATION BECAUSE IN THE STATE MENT BEFORE THE ASSESSING OFFICER I.E., SH. SHUKHDEV SINGH CLAIMED TO HAVE SOLD LAND OF SH. SAWARN SINGH, S/O SH. HARBANSH SINGH BY SA LE DEED EXECUTED ON 25.06.2008, HOWEVER, THE SAID AMOUNT OF R S.16,30,000/- ALLEGED TO BE GIVEN TO THE ASSESSEE ONLY ON 06.01.2009 AND IT REFLECTS THAT THE PROPERTY DOES NOT BELONG TO SH. SHUKHDEV SI NGH BUT HE HAS ACTED ONLY AS HOLDER OF POWER ATTORNEY OF SH. SAWARN SINGH, S/O SH. HARBHAJAN SINGH AND IN PRINCIPLE CONSIDERATION AMOUNT WAS SUPPOSED TO BE PAID TO SH. SAWARN SINGH BEING AN OWNER OF TH E PROPERTY. EXPLANATION OFFERED BY SH. SHUKHDEV SINGH CREATES SO M ANY SUSPICIONS PARTICULARLY THAT BEING AN ADVOCATE, HE REMAI NS BUSY IN THE COURT AND GIVEN THE AFORESAID MONEY ON 20.01.2009 WI TH THE UNDERSTANDING THAT THE SAME WILL BE RECEIVED LATER ON. IN OUR THOUGHTFUL CONSIDERATION, THE EXPLANATION OFF ERED BY THE ASSESSEE SUFFERS FROM SERIOUS DISCREPANCIES AND IMPROBABILITI ES BECAUSE FROM THE STATEMENT OF SH. SUKHDEV SINGH ITSELF SHOWS THAT ITA NO.599 (ASR)/2015 ASST. YEAR : 2009-10 7 THE LAND WAS SOLD ON 25 TH JUNE, 2008, HOWEVER, THE CONSIDERATION AMOUNT ALLEGED TO BE GIVEN ONLY ON 6 TH JANUARY, 2009 AND THERE IS A GAP OF APPROXIMATELY SEVEN MONTHS AND EVEN OTHERWISE S H. SHUKHDEV SINGH WAS NEITHER THE OWNER OF THE PROPERTY NOR ENT ITLED TO RETAIN THE MONEY, THEREFORE, GIVING TO THE ASSESSEE AFTER SEVEN MO NTHS OF THE SALE DOES NOT IN ANY CASE SEEMS TO BE PROBABLE. HENCE, ON T HE AFORESAID CONSIDERATION AND ANALAYZATION, WE ARE OF TH E CONSIDERED OPINION THAT THE ASSESSEE HAD FAILED TO OFFER SATISFACTOR Y EXPLANATION ABOUT THE NATURE AND SOURCE OF INVESTMENT IN THE FORM OF DEPOSIT IN BANK ACCOUNT, WHICH WOULD ENTAIL DEEMED TO BE THE INC OME OF THE ASSESSEE FOR SUCH FINANCIAL YEAR UNDER CONSIDERATION. ON THE AFORESAID CONSIDERATION AND OBSERVATIONS ORIGINAL AND ADDITIONAL GROUND RAISED IN THE APPEAL STANDS DISMISSED. 7. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE STANDS D ISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 31.10.2017. SD/- SD/- (T. S. KAPOOR) (N.K.CHOUDHRY) ACCOUNTANT MEMBER JUDICI AL MEMBER DATED:31.10.2017. /PK/ PS. COPY OF THE ORDER FORWARDED TO: (1) THE ASSESSEE: (2) THE (3) THE CIT(A), (4) THE CIT, (5) THE SR DR, I.T.A.T., TRUE COPY BY ORDER