MRS.SUMITA RAMESH PATODIA, MUMBAI V. DY CIT CC-1(1), MUMBAI

ITA 6016/MUM/2018

• Counselvise Citation: [2021] 107 COUNSELVISE.COM (IT) 9199 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 9 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-08-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2014-2015
• Appeal Filed On: 22-10-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: NARENDRA JANG PA NGI LD
• Assessee Lawyers: HIRAL SEJPAL LD
• Keywords: Unexplained cash credit; Gift
• Section: 80C; 143(3); 153A

Judgement Text

MRS. SU M ITA RAMESH PATODIA ASSESSMENT YEARS: 2014 - 15 & 2015 - 16 1 IN THE INCOME TAX APPELLATE TRIBUNAL F BENCH, MUMBAI , , BEFORE HONBLE SHRI AMARJ I T SINGH , JM AND HONBLE SHRI MANO J KUMAR AGGARWAL, AM (HEARING THROUGH VIDEO CONFERENCING MODE) ./ I.T.A. NO. 601 6 /MUM/201 8 ( / ASSESSMENT YEAR : 2014 - 15 ) & ./ I.T.A. NO. 601 7 /MUM/2018 ( / ASSESSMENT YEAR : 2015 - 16 ) MRS. SU M ITA RAME SH PATODIA 405, SHREE VILLA, PLOT NO.137 SECTOR - 50, NERUL NAVI MUMBAI - 4 00 706 / VS. DCIT CC 1(1), R. NO. 903, 9 TH FLOOR, OLD CGO BUILDING, M. K. ROAD, MUMBAI - 400 020 ./ ./ PAN/GIR NO . A NOPP - 7257 - R ( / APPELLANT ) : ( / RESPONDENT ) ASSESSEE BY : MS. HIRAL SEJPAL LD. AR REVENUE BY : SHRI NARENDRA JANG PA NGI LD. CIT - DR / DATE OF HEARING : 26 /07 /2021 / DATE OF PRONOUNCEMENT : 06/08/2021 / O R D E R MANOJ KUMAR AGGARWAL (ACCO UNTANT MEMBER) 1. 1 THE GRIEVANCE OF THE ASSESSEE IN AFORESAID APPEALS FOR ASSESSMENT YEARS (AY) 2014 - 15 & 2015 - 16 IS COMMON. IT IS ADMITTED POSITION THAT ADJUDICATION OF ANY ONE APPEAL SHALL EQUALLY APPLY TO THE OTHER APPEAL ALSO. THESE APPEALS WERE HEARD ON 26/07/2021 ALONG WITH APPEALS OF OTHER FAMILY MEMBERS OF THE GROUP SINCE ISSUES WERE MRS. SU M ITA RAMESH PATODIA ASSESSMENT YEARS: 2014 - 15 & 2015 - 16 2 COMMON. FOR THE PURPOSE OF ADJUDICATION, THE APPEAL FOR AY 2014 - 15 IS TAKEN AS THE LEAD YEAR WHICH ARISES OUT OF THE ORDER OF LEARNED COMMISSIONER OF INCOME - TAX (APPEAL S) - 47 , MUMBAI [CIT(A)], DATED 31/07 /20 18 IN THE MATTER OF ASSESSMENT FRAMED BY LD. ASSESSING OFFICER (AO) U/S 143(3) R.W.S. 153A OF THE ACT ON 2 1 /12/2016. THE ASSESSEE IS AGGRIEVED BY CONFIRMATION OF CERTAIN ADDITIONS IN THE IMPUGNED ORDER. 1. 2 HAVING HEA RD RIVAL SUBMISSIONS AND UPON PERUSAL OF RELEVANT MATERIAL ON RECORD, OUR ADJUDICATION WOULD BE AS GIVEN IN SUCCEEDING PARAGRAPHS. 2. THE MATERIAL FACTS ARE THAT PURSUANT TO SEARCH ACTION ON BALAJI GROUP ON 28/01/2015, THE PREMISES OF THE ASSESSEE WERE ALS O COVERED UNDER THE SEARCH. IN RESPONSE TO NOTICE U/S 153A, THE ASSESSEE OFFERED RETURNED INCOME OF RS. 6 .0 9 LACS WHICH WAS THE SAME AS OFFERED U/S 139(1). THE ASSESSEE WAS SADDLED WITH VARIOUS ADDITIONS WHICH ARE ADJUDICATED AS UNDER: - 3. GIFTS 3.1 THE AS SESSEE RECEIVED GIFTS OF RS.0.9 7 LACS FROM H ER MOTHER - IN - LAW SMT. SANTABEN VASHRAMBHAI PATODIYA WHICH WAS SUPPORTED BY GIFT DEED AND LAND HOLDINGS. HOWEVER, BANK STATEMENT WAS NOT FILED. FURTHER, DONOR HAD REFLECTED INCOME OF RS.1.78 LACS ONLY. THE DONOR H AD GIFTED AMOUNT OF RS.4.9 4 LACS TO VARIOUS OTHER FAMILY MEMBERS DURING THE YEAR . THEREFORE, REJECTING ASSESSEES EXPLANATION, THE SE GI F TS WERE ADDED TO ASSESSEES INCOME AS UNEXPLAINED CASH CREDIT U/S 68. THE LD.CIT(A), AFTER APPRECIATING ADDITIONAL EVIDE NCES, CONFIRMED THE ADDITION BY OBSERVING THAT THE DONOR ADVANCED GIFTS TO VARIOUS OTHER MEMBERS AND THERE WAS NO CONCRETE INCOME IN HER RETURN OF INCOME. THE DONOR WAS MRS. SU M ITA RAMESH PATODIA ASSESSMENT YEARS: 2014 - 15 & 2015 - 16 3 STATED TO HAVE CONTRIBUTED AN AMOUNT OF RS.10.47 LACS TOWARDS HOUSEHOLD EXPENSES WHICH WAS HIGHLY IMPROBABLE. NO AGRICULTURAL INCOME WAS OFFERED BY HER IN RETURN OF INCOME. AGGRIEVED, THE ASSESSEE IS IN FURTHER APPEAL BEFORE US. 3. 2 WE FIND THAT SIMILAR ISSUE HAS BEEN DECIDED BY US IN ASSESSEES FAVOR IN ITA NO.6012/MUM/2018 AS FOLLOWS: - 3.5 UPON PERUSAL OF DOCUMENTS ON RECORD, WE FIND THAT T HE MOTHER OF THE ASSESSEE HAS DECLARED INCOME OF RS.1.78 LACS DURING THE YEAR AS MISCELLANEOUS INCOME. HOWEVER, UPON PERUSAL OF HER BALANCE SHEET AS ON 31/03/2014, AS PLACED ON RECORD, IT COULD BE SEEN THAT SHE HAS CAPITAL BALANCE OF RS.1287.32 LACS WHICH HAS BEEN INVESTED IN VARIOUS FORMS. THIS CAPITAL BALANCE IS ARRIVED AT AFTER REDUCING GIFTS OF RS.4.94 LACS AND WITHDRAWALS OF RS.10.47 LACS. THE SOURCE OF GIFT, IN OUR OPINION, COULD NOT SOLELY BE THE CURRENT YEARS INCOME PARTICULARLY IN VIEW OF THE FACT THAT THE MOTHER OF THE ASSESSEE WAS ON OLD LADY AND LIVING IN A JOINT FAMILY. THERE IS NO ADVERSE MATERIAL TO PROVE THE GIFTS. THEREFORE, THE CONCLUSION DRAWN BY LD. CIT(A) COULD NOT BE SUSTAINED AND WE ARE INCLINED TO DELETE THE ADDITION OF RS.1 LACS. FACTS BEING PARI - MATERIA THE SAME, WE DELETE THE IMPUGNED ADDITION AND ALLOW THIS GROUND OF APPEAL. 3.3 THE ASSESSEE RECEIVED ANOTHER GIFT OF RS.0.97 LACS FROM HER BROTHER SHRI HANSRAJ KOHTIYA. IN THE A BSENCE OF RETURN OF INCOME AND BANK STATEMENT, THE SAME WAS ADDED TO THE INCOME OF THE ASSESSEE. THE SAME, UPON CONFIRMATION BY LD. CIT(A) IS IN FURTHER CHALLENGE BEFORE US. 3.4 WE FIND THAT THE DONOR IS AN AGRICULTURIST WHICH IS SUPPORTED BY PARTICULARS O F LAND HOLDING IN THE AFFIDAVIT. THE GIFTS ARE DULY SUBSTANTIATED BY THE AFFIDAVIT OF THE DONOR. THE AMOUNTS OF GIFTS ARE LESS THAN RS.1 LAC WHICH WAS BELOW EXEMPTION LIMIT OF RS.2 LACS. THEREFORE, THERE WOULD BE NO OBLIGATION ON THE DONOR TO FILE THE RETU RN OF INCOME. THE DETAILS OF AGRICULTURAL LAND HAVE BEEN WELL ENUMERATED IN THE AFFIDAVIT. REGARDING ALLEGATION OF IMMEDIATE CASH DEPOSIT, THE DONORS BEING AGRICULTURIST MRS. SU M ITA RAMESH PATODIA ASSESSMENT YEARS: 2014 - 15 & 2015 - 16 4 WORKING IN REMOTE VILLAGE WOULD RECEIVE THE PROCEEDS OF AGRICULTURE IN CASH. THE CASH DEPOSIT NEED NOT MATCH WITH HARVESTING SEASON SINCE THERE IS NO SUCH REQUIREMENT UNDER LAW. THEREFORE, THIS ADDITION STAND S DELETED. WE ORDER SO. 4. REJECTION OF CLAIM OF HOUSE PROPERTY LOSS & DEDUCTION U/S 80C 4.1 THIS ADDITION STEM FROM THE FACT THAT TH E ASSESSEE CLAIMED DEDUCTION OF INTEREST ON BORROWED CAPITAL FOR RS.0.13 LACS FOR SELF - OCCUPIED PROPERTY UNDER THE HEAD INCOME FROM HOUSE PROPERTY. IN THE ABSENCE OF SUFFICIENT EVIDENCES, THE DEDUCTION WAS DENIED TO THE ASSESSEE. THE SAME UPON, CONFIRMATIO N BY LD. CIT(A) IS IN FURTHER CHALLENGE BEFORE US. THE ASSESSEE HAD ALSO CLAIMED DEDUCTION OF REPAYMENT OF PRINCIPAL AMOUNT FOR RS.0.71 LAC U/S 80C WHICH WAS ALSO DENIED IN THE SIMILAR MANNER. 4.2 UPON PERUSAL OF DOCUMENTS, WE FIND THAT ASSESSEE HAS PLACED ON RECORD A COPY OF SPECIAL POWER OF ATTORNEY AS WELL AS MORTGAGE DEED DATED 03/03/2008 WITH RESPECT TO PROPERTY. THE ASSESSEE IS JOINT OWNER OF THE PROPERTY. ON THE LOAN TAKEN FROM GOPINATH PATIL PARSIK JANATA SAHAKARI BANK LTD., AN AMOUNT OF RS.0.32 LAC S HAS BEEN PAID AS INTEREST ALONG WITH REPAYMENT OF PRINCIPAL AMOUNT OF RS.1.71 LACS. THE HUSBAND OF THE ASSESSEE, AS CO - OWNER, HAS CLAIMED ONLY PROPORTIONATE DEDUCTION WHICH IS EVIDENT FROM HIS COMPUTATION OF INCOME. THUS, THESE TWO CLAIMS WOULD BE ALLOWA BLE TO THE ASSESSEE. WE ORDER SO. 5. LOW HOUS EHOLD DRAWINGS 5.1 UPON PERUSAL OF DRAWINGS DETAILS, IT TRANSPIRED THAT THE FAMILY DECLARED AGGREGATE DRAWINGS OF RS.1.40 LACS WHICH INCLUDE CHILDRENS MRS. SU M ITA RAMESH PATODIA ASSESSMENT YEARS: 2014 - 15 & 2015 - 16 5 EDUCATION EXPENSES AND LIC PAYMENTS, THE ASSESSEE DID NOT F URNISH COMPLETE DETAILS OF EXPENSES ON VARIOUS ITEMS, EXPENSES DURING FUNCTIONS AND FESTIVALS, TRAVELLING ETC. IT WAS CONCLUDED THAT THE OVERALL DRAWINGS WERE TOO LOW TO RUN A FAMILY. ACCORDINGLY, THE YEARLY DRAWINGS WERE ESTIMATED AT RS.4.00 LACS AND THE DIFFERENCE OF RS.2.59 LACS WAS ADDED TO THE INCOME OF THE ASSESSEE. 5.2 WE FIND THAT SIMILAR ISSUE HAS BEEN DECIDED BY US IN ASSESSEES FAVOR IN ITA NO.6012/MUM/2018 AS FOLLOWS: - 4.4 AFTER GOING THROUGH THE OBSERVATIONS OF LD. CIT(A) AND MATERIAL ON RECOR D AND IN VIEW OF OUR OBSERVATIONS IN PRECEDING PARA 3.5, WE ARE OF THE VIEW THAT THE DRAWINGS MADE BY THE MOTHER AS WELL AS GIFTS GIVEN BY HER ARE DULY SUPPORTED BY HER BALANCE SHEET AS ON 31/03/2014. IT COULD BE SEEN THAT SHE HAS CAPITAL BALANCE OF RS.128 7.32 LACS WHICH HAS BEEN INVESTED IN VARIOUS FORMS. THIS CAPITAL BALANCE IS ARRIVED AT AFTER REDUCING GIFTS OF RS.4.94 LACS AND WITHDRAWALS OF RS.10.47 LACS. THE ASSESSEES DRAWINGS IN ALL THE EARLIER YEARS ARE LESS THAN RS.2 LACS WHICH IS EVIDENT FROM DET AIL OF HOUSEHOLD EXPENSES AS PLACED ON RECORD FOR VARIOUS YEARS. THIS BEING THE CASE, THIS ADDITION IS NOT SUSTAINABLE AND HENCE, WE DELETE THE SAME. FACTS BEING PARI - MATERIA THE SAME, WE DELETE THE IMPUGNED ADDITION AND ALLOW THIS GROUND OF APPEAL. 6. SU NDRY CREDITORS 6.1 THE ASSESSEE WAS ASKED TO FILE THE DETAILS OF YEAR - END SUNDRY CREDITORS OF RS.2.89 LACS. THE ASSESSEE SUBMITTED THAT THE SUNDRY CREDITORS WERE FOR THE BUSINESS COVERED U/S 44AD. THEREFORE, THE ASSESSEE WAS NOT REQUIRED TO MAINTAIN BOOKS OF ACCOUNTS AND THE NAME, ADDRESS & PAN OF THE CREDITORS WAS NOT AVAILABLE. THE SAME WAS, CONSEQUENTLY, ADDED TO THE INCOME OF THE ASSESSEE. THE ACTION OF LD. AO, UPON CONFIRMATION BY LD. CIT(A) IS IN FURTHER CHALLENGE BEFORE US. 6.2 WE FIND THAT IN TERMS OF SEC.44AD, THE INCOME IS COMPUTED ON PRESUMPTIVE BASIS AND THERE IS NO NEED TO MAINTAIN BOOKS OF ACCOUNTS. THEREFORE, THE IMPUGNED ADDITION, AS MADE U/S 41(1), IN OUR CONSIDERED MRS. SU M ITA RAMESH PATODIA ASSESSMENT YEARS: 2014 - 15 & 2015 - 16 6 OPINION, COULD NOT BE SUSTAINED IN THE EYES OF LAW. BY DELETING THE SAME, WE ALLOW THIS GROUND OF APPEAL. T HE APPEAL STANDS ALLOWED IN TERMS OF OUR ABOVE ORDER. 7. ITA NO.601 7 /MUM/2018, AY 2015 - 16 7.1 THE FACTS AS WELL AS ISSUES ARE SUBSTANTIALLY THE SAME IN THIS YEAR. THE ASSESSEE WAS SADDLED WITH ADDITION OF LOW HOUSEHOLD DRAWIN GS & SUNDRY CREDITORS. THE DEDUCTION OF INTEREST PAID ON HOUSING LOAN UNDER THE HEAD INCOME FROM HOUSE PROPERTY WAS DENIED. ANOTHER DEDUCTION OF REPAYMENT OF PRINCIPAL AMOUNT OF HOUSING LOAN AS CLAIMED U/S 80C WAS ALSO DENIED. ALL THESE ISSUES HAVE BEEN DE CIDED BY US IN ASSESSEES FAVOR IN AY 2014 - 15. TAKING THE SAME VIEW, THESE ADDITIONS STAND DELETED. 7.2 THE LAST ADDITION IS FOR GIFT OF RS.0.97 LACS RECEIVED FROM BROTHER SHRI VINODBHAI UKABHAI KOTHIYA. THIS ADDITION STAND DELETED IN VIEW OF THE FACT THAT THE DONOR HAS FILED AFFIDAVIT & PROOF OF LAND HOLDINGS. THE DETAILS OF AGRICULTURAL LAND HAVE BEEN WELL ENUMERATED IN THE AFFIDAVIT. KEEPING IN VIEW THE AMOUNT OF GIFT, THE DONOR WOULD NOT BE REQUIRED TO FILE INCOME TAX RETURN. THIS GROUND STAND ALLOWED. THE APPEAL STAND ALLOWED. CONCLUSION 8. BOTH THE APPEALS STAND ALLOWED. ORDER PRONOUNCED ON 6 TH AUGUST 2021. SD/ - SD/ - ( AMARJIT SINGH) (MANOJ KUMAR AGGARWAL) / JUDICIAL MEMBER / ACCOUNTANT MEMBER MUMBAI; DATED : 06.08.2021 SR.PS, DHANANJAY MRS. SU M ITA RAMESH PATODIA ASSESSMENT YEARS: 2014 - 15 & 2015 - 16 7 / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT 3. ( ) / THE CIT(A) 4. / CIT CONCERNED 5. , , / DR, ITAT, MUMBAI 6. / GUARD FILE / BY ORDER, / (DY./ASSTT.REGISTRAR) , / ITAT, MUMBAI.