Suresh Namdevrao Ghuge, Jalna V. Income-tax Officer,

ITA 659/PUN/2014

• Counselvise Citation: [2015] 134 COUNSELVISE.COM (IT) 0557 (ITAT-PUNE)
• Duration Of Justice: 1 year(s) 8 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-12-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 28-12-2015
• Assessment Year: 2005-2006
• Appeal Filed On: 07-04-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S K JADHAV
• Assessee Lawyers: SANJEEV K KABRA
• Keywords: Unexplained investment; Salary income
• Section: 143(3); 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH A , PUNE , . . , BEFORE MS. SUSHMA CHOWLA, JM AND SHRI R.K. PANDA, AM . / ITA NO. 659 /PN/201 4 / ASSESSMENT YEAR : 200 9 - 1 0 SHRI SURESH NAMEVRAO GHUGE, C/O BANSILAL KABRA, ADVOCATE, 20, 1 ST FLOOR, AMBIKA MARKET, JALNA 431203 . / APPELLANT PAN: AIQPG7670J VS. THE INCOME TAX OFFICER , WARD 1 (4), PARBHANI . / RESPONDENT / APPELLANT BY : SHRI SANJEEV K. KABRA / RESPOND ENT BY : SHRI S.K. JADHAV, JCIT / DATE OF HEARING : 28 . 12 .2015 / DATE OF PRONOUNCEMENT: 30 . 1 2 .2015 / ORDER PER SUSHMA CHOWLA, JM : THIS APPEAL FILED BY THE ASSESSEE IS AGAINST THE ORDER OF CIT (A), AURANGABAD, DATED 28 .0 2 .201 4 RELATING TO ASSESSMENT YEAR 20 0 5 - 0 6 AGAINST ORDER PASSED UNDER SECTION 143(3) R.W.S. 147 OF THE INCOME TAX ACT, 1961 (IN SHORT THE ACT) . 2 ITA NO. 659 /PN/201 4 SHRI SURESH NAMDEVRAO GHUGE 2. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL : - 1. ADDITION OF RS.2,30,002/ - BY DISALLOWING INTEREST. THE LEARNED INCOME TAX OFFICER IS NOT JUSTIFIED IN MAKING ADDITION OF RS. 3,70,000/ - AS UNEXPLAINED INVESTMENT. ON APPEAL THE LEARNED CIT(A) HAS PARTLY ALLOWED THE APPEAL AND RESTRICTED THE ADDITION AT RS.1,60,000/ - . 2. THE APPELLANT MAY KINDLY BE ALLOWED TO ADD AND AMEND THE GROUNDS OF APPEAL. 3. THE ISSUE RAISED IN THE PRESENT APPEAL IS AGAINST THE ADDITION OF RS.1,60,000/ - . 4. BRIEFLY, IN THE FACTS OF THE PRESENT CASE, THE ASSESSEE HAD MADE AN INVESTMENT OF RS.5,00,000/ - AS CO - OWNER OF IMMOVABLE PROPERTY IN MUNICIPAL LIMITS OF HINGOLI MUNICIPAL COUNCIL, GANESHWADI, DIST. HI NGOLI. THE SAID PROPERTY WAS PURCHASED BY THE ASSESSEE ALONG WITH THREE OTHER PERSONS FOR TOTAL CONSIDERATION OF RS.16,00,000/ - ON 12.08.2004. THE ASSESSEE INVESTED RS.5,00,000/ - AS 25% IN THE SAID PROPERTY. THE SAID INFORMATION WAS RECEIVED BY THE ASSESSING OFFICER THROUGH AIR AND SINCE THE ASSESSEE HAD NOT FURNISHED ANY RETURN OF INCOME FOR THE CAPTIONED ASSESSMENT YEAR, REASONS WERE RECORDED AND NOTICE WAS ISSUED UNDER SECTION 148 OF THE ACT. IN RESPONSE THERETO, THE ASSESSEE FURNISHED THE RE TURN OF INCOME DECLARING TOTAL INCOME OF RS.62,220/ - . IN RESPONSE TO THE NOTICE ISSUED BY THE ASSESSING OFFICER, THE ASSESSEE EXPLAINED THAT HE WAS A SALARIED PERSON AND HAD NO OTHER SOURCE OF INCOME, EXCEPT SALARY . IN RESPECT OF INVESTMENT MADE IN THE P URCHASE OF PROPERTY, THE EXPLANATION OF THE ASSESSEE WAS THAT HE HAD OBTAINED LOAN OF RS.1,30,000/ - ON 12.06.2004 FROM NAGNATH URBAN CO - OP. BANK LTD. , HINGOLI AND ALSO HIS FATHER AND BROTHERS HAD 3 ITA NO. 659 /PN/201 4 SHRI SURESH NAMDEVRAO GHUGE ADVANCED LOAN OF RS.3,35,000/ - . THE BALANCE OF RS.2,20,000/ - WAS OUT OF HIS SAVINGS FROM SALARY OVER THE PERIOD OF YEARS. THE ASSESSING OFFICER REJECTING THE EXPLANATION OF THE ASSESSEE, IN VIEW OF THE QUANTUM OF SALARY AND THE ABSENCE OF ANY DETAILS WITH REGARD TO LOAN RECEIVED FROM HIS FATHER, ACCEP TED THE CONTENTION OF THE ASSESSEE TO THE EXTENT OF LOAN RECEIVED FROM THE BANK I.E. RS.1,30,000/ - AND THE BALANCE INVESTMENT OF RS.3,70,000/ - WAS TREATED AS UNEXPLAINED AND ADDITION WAS MADE TO THE TOTAL INCOME OF THE ASSESSEE. 5. THE CIT(A) CONSIDERED THE EXPLANATION OF THE ASSESSEE WITH REGARD TO SALARIED INCOME AND PAST SAVINGS AND THE PLEA OF THE ASSESSEE THAT THE SAID SAVINGS WERE NOT UTILIZED TO THE EXTENT OF RS.1,20,000/ - . HOWEVER, THE CIT(A) ACCEPTED THE PLEA OF THE ASSESSEE WITH REGARD TO INVE STMENT IN LAND TO THE EXTENT OF RS.60,000/ - AS AGAINST THE CLAIM OF THE ASSESSEE AT RS.1,20,000/ - . THE CIT(A) FURTHER ACCEPTED THE PLEA OF THE ASSESSEE REGARDING LOAN RECEIVED FROM HIS FATHER / BROTHERS TO THE EXTENT OF RS.1,50,000/ - AND UPHELD THE ADDITI ON TO THE EXTENT OF RS.1, 0 0,000/ - . IN TOTALITY, THE ADDITION WAS RESTRICTED TO RS.1,60,000/ - AS AGAINST RS.3,70,000/ - MADE BY THE ASSESSING OFFICER. 6. THE ASSESSEE IS IN APPEAL AGAINST THE ORDER OF CIT(A). 7. SHRI SANJEEV K. KABRA APPEARED FOR THE ASSE SSEE AND SHRI S.K. JADHAV, JCIT APPEARED FOR THE REVENUE AND PUT FORWARD THEIR CONTENTIONS. 8. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE RECORD. THE ASSESSEE HAD MADE AN INVESTMENT TO THE EXTENT OF RS.5,00,000/ - IN PURCHASING 25% SHARE IN THE PROPERTY. THE SOURCE S OF INVESTMENT IN THE SAID PROPERTY WERE 4 ITA NO. 659 /PN/201 4 SHRI SURESH NAMDEVRAO GHUGE CLAIMED BY THE ASSESSEE TO BE OUT OF LOAN RECEIVED FROM BANK TO THE EXTENT OF RS.1,30,000/ - , WHICH HAD BEEN ACCEPTED BY THE ASSESSING OFFICER AND ALSO ADOPTED BY THE CIT(A). THE SECOND CONTENTION OF THE ASSESSEE VIS - - VIS SOURCE OF INVESTMENT WAS THE LOAN RECEIVED FROM THE FATHER AND BROTHERS OF THE ASSESSEE , WHICH WAS NOT ACCEPTED BY THE ASSESSING OFFICER AND THE CIT(A) HELD THAT IN VIEW OF THE AGRICULTURAL IN CO ME OF THE FATHER AND BROTHERS, LOAN OF RS.1,00,000/ - IS ACCEPTED FROM HIS FATHER AND RS.50,000/ - FROM THREE BROTHERS , T HE BALANCE LOAN OF RS.1,00,000/ - CLAIMED TO BE ADVANCED BY THEM, WAS NOT ACCEPTED. HOWEVER, WE FIND NO MERIT IN THE ORDER OF CIT(A) IN T HIS REGARD, WHERE THE ASSESSEE HAD EXPLAINED THE NATURE OF LAND HOLDING BY HIS FATHER AND BROTHERS, WHO HA VE MADE CERTAIN ADVANCES AND ALSO INVESTMENTS, WHICH WERE AVAILABLE WITH THEM. IN ANY CASE, SAVINGS OF RS.2,50,000/ - FROM THE FATHER AND HIS THREE BR OTHERS, MERITS TO BE ACCEPTED IN THE HANDS OF ASSESSEE, OUT OF WHICH CREDIT OF RS.1,50,000/ - HAS ALREADY BEEN ALLOWED BY THE CIT(A) AND WE DIRECT THE ASSESSING OFFICER TO ALLOW THE CREDIT OF BALANCE SUM OF RS.1,00,000/ - . 9. THE NEXT CONTENTION OF THE ASSESSEE WAS HIS SAVINGS FROM HIS SALARY INCOME TO THE EXTENT OF RS.1,20,000/ - . THE DETAILS OF SALARY INCOME EARNED BY THE ASSESSEE FROM YEAR TO YEAR IS TAB ULATED AT PAGE 3 OF ASSESSMENT ORDER AND THE ASSESSEE OVER THE PERIOD OF YEARS WAS IN RECEIPT OF SA LARY RS. 6,90,648/ - . THE ASSESSEE CLAIMS THAT HE HAD INCURRED EXPENDITURE OF RS.5,14,500/ - FOR HIS DAILY NEEDS AND THE BALANCE OF RS.2,20,000/ - WAS AVAILABLE WITH HIM. THE CIT(A) HAS ACCEPTED THE SAVINGS TO THE EXTENT OF RS.60,000/ - . IN THE ENTIRETY OF T HE ABOVE FACTS AND CIRCUMSTANCES, WHERE THE ASSESSEE WAS A SALARIED PERSON, WE FIND NO MERIT IN THE AFORESAID BALANCE ADDITION OF RS.60,000/ - . W E ACCEPT THE PLEA OF THE ASSESSEE WITH REGARD TO HIS SAVINGS TO THE EXTENT OF RS.1,20,000/ - IN ALL. IN VIEW 5 ITA NO. 659 /PN/201 4 SHRI SURESH NAMDEVRAO GHUGE TH EREOF, WE ALLOW THE CREDIT OF BALANCE SUM OF RS. 60,000/ - IN HIS HANDS. ACCORDINGLY, WE DELETE THE ADDITION SUSTAINED BY THE CIT(A) IN THE HANDS OF THE ASSESSEE. 1 0 . IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED ON THIS 30 TH DAY OF DECEMBER , 2015. SD/ - SD/ - ( R.K. PANDA ) ( SUSHMA CHOWLA ) / ACCOUNTANT MEMBER / JUDICIAL MEMBER / PUNE ; DATED : 30 TH DECEMBER , 2015 . GCVSR / COPY OF THE ORDER IS FORWARDED TO : 1. / THE APPELLANT ; 2. / THE RESPONDENT; 2. / THE RESPONDENT; 3. ( ) / THE CIT(A), AURANGABAD ; 4. / THE CIT , AURANGABAD ; 5. , , / DR A , ITAT, PUNE; 6. / GUARD FILE . / BY ORDER , // TRUE COPY // / SR. PRIVATE SECRETARY , / ITAT, PUNE