Maruti Sukir Patil, Pune V. Income-tax Officer,

ITA 638/PUN/2016

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 1613 (ITAT-PUNE)
• Duration Of Justice: 2 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-06-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2009-2010
• Appeal Filed On: 11-04-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: HITENDRA NINAWE
• Assessee Lawyers: Y P PANDIT
• Section: 143(3); 68

Judgement Text

- IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH SMC, PUNE , BEFORE MS. SUSHMA CHOWLA, JM / ITA NO.638/PN/2016 ! ' ' / ASSESSMENT YEAR : 2009-10 MR. MARUTI SUKIR PATIL, C/O MR. D.Y. PANDIT, ADV.1187/10, KRUPA, SHIVAJINAGAR, PUNE 411 006 . / APPELLANT PAN: AHEPP0663K VS. THE INCOME TAX OFFICER, WARD 4, PANVEL . RESPONDENT / APPELLANT BY : SMT. DEEPA KHARE & SHRI Y. P. PANDIT / RESPONDENT BY : SHRI HITENDRA NINAWE DATE OF HEARING : 28.06.2016 / DATE OF PRONOUNCEMENT: 30.06.2016 # / ORDER PER SUSHMA CHOWLA, JM: THIS APPEAL FILED BY THE ASSESSEE IS AGAINST THE OR DER OF CIT(A)-2, THANE, DATED 22.12.2015 RELATING TO ASSESSMENT YEAR 2009-10 AGAINST ORDER PASSED UNDER SECTION 143(3) OF THE INCOME-TAX ACT, 1961 (IN SHORT THE ACT). ITA NO.638/PN/2016 2 2. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL:- 1. THE LD. CIT (APPEALS)-II, THANE ERRED IN LAW AND ON FACTS IN CONFIRMING THE ADDITION OF RS.5,00,000/- MADE BY THE ASSESSING OFFICER ON ACCOUNT OF UNEXPLAINED CASH DEPOSIT IN THE BANK ACCOUNT OF THE ASSESSEE. 2. HE OUGHT TO HAVE ACCEPTED THAT THE REASONS RECOR DED IN REMAND REPORT BY THE ASSESSING OFFICER DATED 21/08/2015 WH EREIN IDENTITY, CAPACITY AND THE GENUINENESS IS ACCEPTED. 3. THE APPELLANT MAY BE PERMITTED TO AMEND OR ALTER ANY OF THE ABOVE GROUNDS OF APPEAL OR ADD A NEW GROUND OF APPEAL ANY TIME BEFORE THE HEARING OF APPEAL OR DURING THE COURSE OF HEARING O F APPEAL. 3. THE ASSESSEE IS IN APPEAL AGAINST AN ADDITION OF RS.5,00,000/- MADE BY THE ASSESSING OFFICER ON ACCOUNT OF UNEXPLAINED CAS H DEPOSIT IN THE BANK ACCOUNT. 4. BRIEFLY, IN THE FACTS OF THE CASE, THE ASSESSING OFFICER DURING THE ASSESSMENT PROCEEDINGS NOTED THAT THE ASSESSEE HAD RECEIVED A SUM OF RS.25,86,250/- AGAINST THE SALE OF AGRICULTURAL LAN D BELONGING TO HIS FAMILY TO M/S MUMBAI SEZ LTD.. FURTHER, THE YOUNGER BROTHERS NAMELY SHRI BHASKAR SUKIR PATIL AND SHRI VASUDEV SUKIR PATIL HAD ALSO R ECEIVED SUM OF RS.6,33,333/- EACH FROM M/S MUMBAI SEZ LTD.. THE ASSESSING OFFIC ER ASKED THE ASSESSEE TO EXPLAIN THE SOURCE OF RS.5,00,000/- DEPOSITED IN CA SH ON 29.05.2008 IN PEN URBAN CO-OPERATIVE BANK LTD.. THE ASSESSEE WAS UNA BLE TO GIVE THE EXPLANATION REGARDING THE SOURCE OF THE SAID DEPOSI T AND HENCE THE SAID AMOUNT WAS ADDED AS INCOME IN THE HANDS OF THE ASSE SSEE UNDER SECTION 68 OF THE ACT. 5. BEFORE THE CIT(A), THE ASSESSEE EXPLAINED THAT T HE SOURCE OF THE SAID SUM OF RS.5,00,000/- WAS OUT OF THE WITHDRAWALS MAD E BY HIS BROTHERS WHO HAD GIVEN RS.2,50,000/- EACH. THE ASSESSEE FURNISHED E VIDENCE BEFORE THE CIT(A) IN THIS REGARD AND ALSO EXPLAINED THE SOURCE IN DET AILS. THE CIT(A) ASKED FOR ITA NO.638/PN/2016 3 THE REMAND REPORT FROM THE ASSESSING OFFICER WHO RE PORTED THAT THE WITHDRAWALS WERE MADE BY HIS BROTHERS IN THE MONTH OF OCTOBER, 2007 AND THE SUM OF RS.5,00,000/- WAS DEPOSITED ON 29.05.2008 AND HENCE THE EXPLANATION WAS NOT RELIABLE AND WAS ALSO DEVOID ON MERITS. THE CIT(A) CONFRONTED THE ASSESSEE WITH THE REMAND REPORT AND AFTER CONSIDERING THE RE PLY OF THE ASSESSEE, THE CIT(A) HELD THAT IF THE CASH LOAN OF RS.5,00,000/- IS ACCEPTED TO HAVE BEEN GIVEN BY HIS YOUNGER BROTHERS I.E. RS.2,50,000/- EA CH THAN THE ASSESSEE HAS VIOLATED THE PROVISIONS OF SECTION 269SS OF THE ACT BY ACCEPTING THE SAID LOAN IN CASH, AS THE ASSESSEE WAS DEALING IN THE BUSINESS O F LAND TRADING AND AS AN ESTATE AGENT AND WAS RUNNING HIS BUSINESS UNDER THE NAME AND STYLE OF M/S M.S. PATIL. THE CIT(A) ALSO DID NOT ACCEPT THE EXP LANATION OF THE ASSESSEE IN RESPECT OF CASH DEPOSIT OF RS.5,00,000/- IN THE ABS ENCE OF ANY SUPPORTING DOCUMENTS PRODUCED BY HIM AND HENCE UPHELD THE ADDI TION. 6. THE ASSESSEE IS IN APPEAL AGAINST THE ORDER OF T HE CIT(A) BEFORE US. 7. THE LD. AUTHORIZED REPRESENTATIVE FOR THE ASSESS EE POINTED OUT THAT THE AGRICULTURAL LAND SOLD BY THE ASSESSEE WAS BEYOND T HE MUNICIPAL LIMITS AND CONSEQUENTLY NO CAPITAL GAIN AROSE IN THE HANDS OF THE ASSESSEE, WHICH STAND HAS BEEN ACCEPTED BY THE ASSESSING OFFICER. HOWEVE R, ADDITION WAS MADE ON ACCOUNT OF DEPOSIT OF RS.5,00,000/- IN CASH IN HIS BANK ACCOUNT BY THE ASSESSING OFFICER WHICH WAS UPHELD BY THE CIT(A). MY ATTENTION WAS DRAWN AT PAGE 8 OF THE ORDER OF THE CIT(A) WHEREIN HE HAS PR ESUMED THAT THE SAID SUM OF RS.5,00,000/- MAY BE DEPOSITED ON ACCOUNT OF ON-MON EY. HE FURTHER POINTED OUT THAT A CONSOLIDATED LAND WAS PURCHASED BY THE A SSESSEE ALONG WITH HIS BROTHERS AND HENCE THE SAID SUM WAS DEPOSITED IN HI S BANK ACCOUNT AND IN LATER YEARS THE LAND WAS BOUGHT BY THE ASSESSEE. ITA NO.638/PN/2016 4 8. THE LD. DEPARTMENTAL REPRESENTATIVE FOR THE REVE NUE, ON THE OTHER HAND, RELIED UPON THE ORDERS OF THE AUTHORITIES BEL OW. 9. ON PERUSAL OF THE RECORD AND THE SUPPORTING EVID ENCE FILED BY THE ASSESSEE IN THE PAPER BOOK, THE ISSUE TO BE DECIDED IN THE PRESENT APPEAL IS IN RELATION TO SOURCE OF CASH DEPOSIT OF RS.5,00,000/- IN THE BANK ACCOUNT OF THE ASSESSEE WHICH WAS MADE ON 29.05.2008. THE ASSESSE E ALONG WITH HIS BROTHERS HAD ADMITTEDLY RECEIVED THE SALE PROCEEDS OF AGRICULTURAL LAND SOLD BY THEM WHICH WAS DEPOSITED BY THEM IN THEIR RESPECTIV E BANK ACCOUNTS. FURTHER, THE TWO BROTHERS OF THE ASSESSEE WITHDREW A SUM OF RS.6,34,000/- AND RS.5,00,000/- RESPECTIVELY FROM THEIR IRRESPECTIVE BANK ACCOUNTS OUT OF WHICH A SUM OF RS.2,50,000/- EACH WAS GIVEN TO THE ASSESSEE , WHO WAS ELDER BROTHER. THE CASE OF THE ASSESSEE IS THAT THE AMOUNT WAS TO BE UTILIZED FOR PURCHASING ANOTHER LAND AND BECAUSE OF THE MARKET CONDITIONS T HE SAID LAND COULD NOT BE PURCHASED IMMEDIATELY BUT WAS PURCHASED ON A LATER DATE. 10. ANOTHER ASPECT OF THE ISSUE WAS THAT THE SAID A MOUNT WAS WITHDRAWN BY THE TWO BROTHERS IN THE MONTH OF OCTOBER, 2007 AND PART OF WHICH WAS DEPOSITED IN THE BANK ACCOUNT OF THE ASSESSEE ON 29.05.2008. ADMITTEDLY, THERE IS A TIME GAP IN THE DEPOSIT OF CASH IN THE BANK ACCOUNT OF T HE ASSESSEE. HOWEVER, THE SAME CANNOT BE USED AGAINST THE ASSESSEE WHERE THER E IS A CLEAR EVIDENCE OF CASH WITHDRAWN BY THE TWO BROTHERS OF THE ASSESSEE IN THE MONTH OF OCTOBER, 2007 AND IN THE ABSENCE OF ANY EVIDENCE FOUND THAT THE SAID AMOUNT HAS BEEN UTILIZED BY THE TWO BROTHERS IN THE PURCHASE OF ANY ASSET OR FOR INCURRING ANY EXPENDITURE, THE PRESUMPTION IS THAT THE SAID CASH IS AVAILABLE WITH THE SAID PERSONS, OUT OF WHICH A PART OF THE CASH OF RS.2,50 ,000/- WAS USED FOR JOINT INVESTMENT IN AN ASSET, WHICH ADMITTEDLY WAS CARRIE D OUT IN THE LATER YEARS. IN THE TOTALITY OF FACTS AND CIRCUMSTANCES, THE ASSESS EE HAVING EXPLAINED SOURCE ITA NO.638/PN/2016 5 OF CASH DEPOSIT OF RS.5,00,000/-, THERE IS NO MERIT IN ANY ADDITION IN THE HANDS OF THE ASSESSEE. 11. NOW, COMING TO THE SECOND ASPECT RAISED BY THE CIT(A) I.E. THE VIOLATION OF PROVISIONS OF SECTION 269SS OF THE ACT. THE TRA NSACTION IN HAND IS BETWEEN THE MEMBERS OF ONE FAMILY AND IS FOR THE PURPOSE OF PURCHASE OF AN ASSET AND THE SAID PROVISIONS OF SECTION 269SS OF THE ACT ARE NOT ATTRACTED IN THE AFORESAID CIRCUMSTANCES. THUS, THE GROUNDS OF APPE AL RAISED BY THE ASSESSEE ARE ALLOWED. 12. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS AL LOWED. ORDER PRONOUNCED ON THIS 30 TH DAY OF JUNE, 2016. SD/- (SUSHMA CHOWLA) / JUDICIAL MEMBER / PUNE ; DATED : 30 TH JUNE, 2016 . ! #$%&'()(& / COPY OF THE ORDER IS FORWARDED TO : THE APPELLANT; THE RESPONDENT; ' ' # () THE CIT(A)-2, THANE; ' ' # THE CIT-2, THANE &'( ))*+, ' *+ , , - . // / DR SMC, ITAT, PUNE; (01 2 / GUARD FILE. #! / BY ORDER & ) // TRUE COPY // 345 )! *6 / SR. PRIVATE SECRETARY ' *+ , ITAT, PUNE