NEELAM P. VORA, MUMBAI V. ITO 25(1)(4), MUMBAI

ITA 6631/MUM/2013

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 3254 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 6 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-06-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 23-05-2016
• Assessment Year: 2009-2010
• Appeal Filed On: 13-11-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MATI BHARTI SINGH
• Assessee Lawyers: JITENDRA SINGH
• Keywords: Income from undisclosed sources; Corroborative evidences
• Section: 143(3); 142(1)

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, MUMBAI BEFORE SHRI MAHAVIR SINGH , JM AND SHRI RAJESH KUMAR, AM ./ I.T.A. NO. 6631 /MUM/201 3 ( / ASSESSMENT YEAR : 20 09 - 10 ) SMT.NE ELAM P VORA, 701, VASANT VANDAN, OPP MKN BHATIYA HIGH SCHOOL , BORIVALI (W), MUMBAI - 400092. / VS. INCOME TAX OFFICER 25(1)(4), ROOM NO.308, C - 10, PRATYAKSHAKAR BHAVAN, BANDRA - KURLA COMPLEX, BANDRA (E), MUMBAI - 4000 51 ./ PAN : AD VPV 7310C / ASSESSEE BY SHRI JITENDRA SINGH / REVENUE BY SHRI MATI BHARTI SINGH / DATE OF HEARING : 23. 5.2016 / DATE OF PRONOUNCEMENT : 8. 6 .2016 / O R D E R PER RAJESH KUMAR, A. M: THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER DATED 2 7 . 9.2013 OF COMMISSIONER OF INCOME TAX (APPEALS) - 3 5 , MUMBAI (HEREINAFTER CALLED AS THE CIT(A) FOR ASSESSMENT YEAR 2009 - 20 10 . 2. THE ASSESSEE HA S RAISED TWO GROUNDS OF APPEAL AGAINST THE ORDER OF LD. CIT(A). IN THE FIRST GROUND, THE ASSESSEE HAS CHALLENGED THE ADDITION OF RS.12,05,000/ - MADE UNDER SECTION 69A OF T HE INCOME TAX ACT, 1961 (THE ACT) 2 6631 /MUM/ 201 3 WHEREAS IN THE SECOND GROUND , THE ASSESSEE HAS CH ALLENGED THE ADDITION OF RS.1,78,250/ - BEING CONFIRMED BY THE LD. CIT(A) FOR BROKERAGE RECEIVED FROM M/S S M SHAH WHICH WAS TREATED AS INCOME FROM UNDISCLOSED SOURCES BY IGNORING THE FACT THAT THE SAID BROKERAGE RELATED TO ASSESSMENT YEAR 2008 - 09 WAS OFF ERED TO TAX IN THE SAID YEAR. 3. THE FACTS OF THE CASE ARE THAT THE ASSESSEE FILED HER RETURN OF INCOME ON 8.7.2009 DECLARING TOTAL INCOME AT RS.1,65,482/ - , WHICH WAS PROCESSED UNDER SECTION 143(1) OF THE ACT. THEREAFTER, THE CASE OF THE ASSESSEE WAS S ELECTED FOR SCRUTINY AND THE STATUTORY NOTICES U/S 143(2) AND 142(1) WERE ISSUED AND SERVED UPON THE ASSESSEE. AS PER THE INFORMATION THROUGH AIR, THE ASSESSEE HAD DEPOSITED IN THE IR SAVINGS BANK ACCOUNT MAINTAINED WITH BANK OF INDIA AN AMOUNT OF RS.23 ,12,000/ - . THE AO DURING THE COURSE OF ASSESSMENT PROCEEDINGS, ASKED THE ASSESSEE TO PRODUCE THE COPY OF BANK ACCOUNT AND TO EXPLAIN SOURCE OF DEPOSITS ALONG WITH THE SUPPORTING EVIDENCE WHICH WAS REP LIED BY THE ASSESSEE VI D E HERE L ET TER DATED 5.10.2011 ST ATING THAT THE INFORMATION OF THE DEPARTMENT QUA DEPOSITING RS.23,12,000/ - IN THE BANK OF INDIA DURING THE FINANCIAL YEAR 2008 - 09 WAS TOTALLY WRONG AND IN FACT THE ASSESSEE HAS DEPOSITED RS.10,26,000/ - IN THE SAID BANK ACCOUNT . THE ASSESSEE EXPLAIN ED TH E SOURCE OF CASH DEPOSIT S IN THE BANK AS UNDER: I) RS.2,OO,OOO / - FROM SHRI PRAKASH D VORA II) RS .4,00,000/ - RECEIVED FROM SHRI RAJNIKANTH D VORA 3 6631 /MUM/ 201 3 III) RS.1 ,78,250 / - ON ACCOUNT OF BROKERAGE RECEIVED FROM M/S SM SHAH IV) RS.2,25,OOO / - FROM SHRI PRAKASH D VORA V) RS.43,858/ - ON ACCOUNT OF NIRMAL BANG, SALE OF SHARES. VI) RS.18,500 / - MEDICLAIM CHEQUE RECEIVED. BESIDES , F ROM THE DETAILS FILED, THE AO NOTICED THAT AN AMOUNT OF RS.3,34,OOO / - - HAS ALSO BEEN DEPOSITED IN CASH IN ACCOUNT WITH T HE ORIENTAL BANK OF COMMERCE, BORIV A LI WEST. THEREFORE, BY ASSESSEES OWN ESTIMATES TOTAL CASH DEPOSIT DURING THE F. Y. 2 008 - 09 WAS TO THE TUNE OF RS.13,70 ,000/ - 4 . IN THE CASE OF PRAKASH D VORA, THE AO OBSERVED THAT THE SAID PERSON WAS NOT HAVING ANY FINANCIAL C APACITY TO GIVE ADVANCE MONEY TO THE ASSESSEE IN CASH. SIMILARLY, THE AO OBSERVED THAT THE REFUND OF LOAN RECEIVED FROM RAJNIKANT D VORA OF RS.4 LAKHS WAS NOT GENUINE AS ASSESSEE FAILED TO FURNISH ANY EVIDENCE IN SUPPORT OF ITS CLAIM. THE AO ALSO FOU ND FROM THE COPY OF BANK ACCOUNT OF THE ASSESSEE WITH THE BANK OF COMMERCE THAT THE ASSESSEE HAS DEPOSITED RS.3,34,000/ - DURING THE YEAR. FINALLY THE AO ISSUED SHOW CAUSE NOTICE TO THE ASSESSEE AS TO WHY THE DEPOSIT OF CASH IN BOTH THE BANK ACCOUNT OF THE ASSESSEE AMOUNTING TO RS.13,70,000/ - SHOULD NOT BE TREATED AS UNEXPLAINED CASH U/S 69A OF THE ACT WHICH WAS REPLIED BY THE ASSESSEE VIDE LETTER DA T ED 22.11.2011 AS UNDER : - 1 . (A) RS.2,OO,OOO/ - CASH FROM SHRI PRAKASH D VORA, THESE FACTS I HAVE A LREADY EXPLAINED IN MY LETTER DATED 28.10.2011 AND EXPLAINED IN DETAIL IN PARA 2 OF THE SAID LETTER. (B) RS.4,OO,OOO/ - CASH RECEIVED FROM SHRI RAJNIKANT D VORA, BEING OF 4 6631 /MUM/ 201 3 REFUND OF LOAN THESE FACTS I HAVE ALREADY EXPLAINED IN MY LETTER DATED 28.10.2011. (C) RS.1,78,250/ - IS A BROKERAGE RECEIVED FROM S M SHAH FOR THE A. Y. 2008 - 09. (D) RS.2,25,OOO/ - PRAKASH. D VORA BY DEMAND DRAFT, THESE FACTS I HAVE ALREADY EXPLAINED IN MY LETTER DATED 28.10.2011.. HE HAS SOLD AGRICULTURE LAND WHICH WAS AT HIS NATIVE PLA CE THE AMOUNT HAS BEEN GIVEN TO ME AS LOAN, COPY OF 7X12 AND LAND REGISTRATION, DEPOSIT SLIPS ENCLOSED. (E) RS. 43, 858/ - RECEIVED BY CHEQUE FROM NIRMAL BAUG FOR SALE OF SHARES. 2. THOUGH MY HUSBANDS INCOME FOR THE A. Y. 2009 - 10 IS RS.1,59,OOO/- IT DOE S NOT MEAN THAT HE HAS NO CAPACITY TO ADVANCE RS.5,50,OOO/- TO ME AS IN THE SAID YEAR HE HAS RECEIVED THE AMOUNT BY SELLING AGRICULTURE LAND, LIC REFUND ON MATURITY, MY HUSBAND HAS SUBMITTED CONFIRMATION LETTER & STATEMENT OF AMOUNT DEPOSITED. 1 . I HAVE ADV ANCE RS .4 ,OO,OOO/ - TO RAJNIKANT D VORA, A TEACHER OVER A PERIOD OF 4 - 5 YEARS FOR CONSTRUCTION HIS HOUSE, HE HAS REPAID BACK THE SAID AMOUNT IN A. Y. 2009 - 10. I OFFER THIS AMOUNT AS MY INCOME FOR THE AY 2009 - 10 AS IT IS NOT POSSIBLE FOR ME TO SUBMIT ANY CON FIRMATION LETTER FROM HIM AS HE HAS EXPIRED. I AM WILLING TO PAY THE TAX ON THIS INCOME KINDLY DO NOT LEVY ANY PENALTY, I WAS NOT AWARE OF IT PROVISIONS RELATING TO RECEIPT A ND DEPOSIT OF CASH IN BANK ACCOUNT. KINDLY DROP THE PENALTY PROCEEDINGS U/S 271B .' 5 . F INALLY, THE AO FRAMED THE ASSESSMENT U/S 143(3) OF THE ACT VIDE ORDER DATED 19.12.2011 ASSESSING THE INCOME OF ASSESSEE AT RS.15,48,732/ - BY MAKING THE DISALLOWANCE OF RS.12,05,000/ - UNDER SECTION 69A AS PER DETAILS INCORPORATED IN PARA 3.8 T O 3.10 OF THE ASSESSMENT ORDER AND SECOND LY , THE AMOUNT OF RS.1,78,25/ - AS UNDISCLOSED BROKERAGE CHARGES WHICH IS DISCUSSED IN PARA 4 OF THE ASSESSMENT ORDER. AGGRIEVED BY THE ORDER OF THE AO, THE ASSESSEE PREFERRED AN APPEAL BEFORE THE LD.CIT(A) WHO A LSO DISMISSED THE APPEAL OF THE ASSESSEE AFTER CONSIDERING T HE SUBMISSIONS OF THE ASSESSEE WHICH HAVE BEEN 5 6631 /MUM/ 201 3 INCOR PORATED IN PARA 4 OF THE APPELLATE ORDER BY OBSERVING AND HOLDING AND AS UNDER : 5. DECISION I HAVE GONE THROUGH THE CONTENTIONS OF THE A O AND THE SUBMISSIONS OF THE APPELLANT. 5A. THE MAIN ADDITION IS UNDER 69 OF THE IT ACT, 1961 OF UNEXPLAINED MONEY OF RS. 12,05,000/ - . THE VARIOUS COMPONENTS OF THIS TOTAL ARE DISCUSSED HERE UNDER: 1. OPENING CASH BALANCE OF RS.3,72,000. THE CONTENT ION OF THE APPELLANT THAT SHE HAD NOT FILED COPIES OF INCOME AND EXPENDITURE ACCOUNT ALONG WITH THE RETURN OF INCOME CANNOT BE TAKEN AS SUFFICIENT EXPLANATION IN LIGHT OF THE FACTS THAT SHE HAS IN ANY CASE NOT BEEN ABLE TO SUBSTANTIATE HOW SHE HAD NOT BALA NCE. IN FACT THE COMPUTATION OF INCOME FILED ALONG WITH THE RETURN FOR AY 2008 - 09 HAS NO SUCH EVIDENCE ALONG WITH IT. THE GROUND OF APPEAL IS DISMISSED AND THE ADDITION OF RS.3,72,000 MADE BY THE AO IS UPHOLD. 2. REFUND OF LOAN OF R S . 4,00,000 EARLIER GIVEN TO BROTHER - IN - L AW - THE EXPLANATION OFFERED IS NOT ACCEPTABLE ON TWO ACCOUNTS; FIRSTLY, THE APPELLANT HAS NOT EVEN EXHIBITED HER OWN ABILITY TO HAVE ADVANCED SUCH A LOAN AND SECONDLY, THERE IS NO EVIDENCE TO SUBSTANTIATE THE RECEIVING BACK OF THE SAI D LOAN. MERE EXPLANATION THAT THE BROTHER - IN - LAW HAS SINCE EXPIRED DOES NOT COMPLETE THE ONUS CAST ON THE APPELLANT TO PROVE THE SOURCE OF THE CREDIT IN HER ACCOUNT. THE ADDITION OF RS 4,00,000 ON THIS ACCOUNT IS UPHELD. 3. CASH OF RS . 5,50,000 DEPOSITED AS RECEIPT FROM HUSBAND - THE APPELLANT HAS ONLY FURNISHED AS EVIDENCE OF THE ABILITY OF THE HUSBAND TO ADVANCE THIS LOAN A COPY OF THE 7/12 EXTRACT OF SOME 3 ACRES OF LAND HOLDING IN NATEPUTE. THIS IN NO WAY SHOWS THAT THE SAID LAND WAS SOLD, AND IF SO T HEN AT WHAT VALUE AND WHETHER ANY SUCH MONEY BECAME THE SOURCE OF HIS ADVANCING THE MONEY TO THE APPELLANT. THE EXPLANATION IS ABSOLUTELY FLIMSY AND IT CANNOT BE TAKEN AS ACCEPTABLE. IN LIGHT OF THIS THE ADDITION MADE BY THE AO TO THE TUNE OF RS . 5,50,000 IS UPHELD. 6 6631 /MUM/ 201 3 2 . ADDITION OF RS 45,000 - THE APPELLANT HAS OFFERED NO EXPLANATION FOR THE DISCREPANCY IN THE VALUE OF CASH DEPOSIT BEING RS. 10,71, 000/ - INSTEAD OF RS.10,26,000/ - AS CLAIMED BY THE APPELLANT. THE ADDITION OF RS . 45,000 MADE BY THE AO IS UPHELD IN LIGHT OF NO COGENT EXPLANATION OFFERED BY THE APPELLANT. 5. AS REGARDS THE SHARE APPLICATION MONEY OF R S 2,00,000 - THE APPELLANT OFFERED NO EXPLANATION EITHER BEFORE THE AO OR AT THE APPEAL STAGE . THIS AMOUNT REMAINS UNEXPLAINED AND INCLUDED FOR THE PURPOSE OF ADDITION U/S 69A: 6. AS REGARDS THE ADDITION MADE OF RS 3,34,000 ON ACCOUNT OF CASH DEPOSITS IN THE ORIENTAL BANK OF COMMERCE BEARING ACCOUNT NUMBER 02872010006850, THE APPELLANT HAS MADE NO SUBMISSION WHATSOEVER. THE ADDITION MADE ON THIS ACC OUNT IS ALSO UPHELD. -- OUT OF THE VARIOUS EXPLANATIONS OFFERED BY THE APPELLANT FOR TOTAL CASH D EPOSITS OF 14,05,000, ONLY 2,00,000 WAS FOUND ACCEPTABLE BY THE AO. THE SAME PO SITION IS UPHELD. IN SUM THEN THE ENTIRE ADDITION OF RS 12,05,000 MADE U/ S 69A IS UPHELD. 5 B. BROKERAGE OF RS 1,78,250 FROM SM SHAH - THE ONLY EXPLANATION EXTENDED BY THE APPELLANT IS THAT THE SAID AMOUNT PERTAINS TO THE EARLIER FY AND THAT SH E HAS ALREADY INCLUDED IT IN HER COMPUTATION OF AY 2008 - 09. IT IS SEEN THAT THE TWO CHEQU ES AS CONFIRMED BY SM SHAH ARE ACTUALLY DEPOSITED IN THE PRESENT FY . T HE EXPLANATION IS NOT FOUND ACCEPTABLE SINCE THE APPELLANT HAS NOT OFFERED ANY COGENT EXPLANATION AS TO HOW AND WHY SHE HAS NOT OFFERED ANY COGENT EXPLANATION AS TO HOW AND WHY SHE HAS ACCOUNTED FOR PAYMENTS THAT SHE RECEIVES ONLY IN JULY OF THE SUBSEQUENT YEAR. THE ADDITION MADE ON THIS ACCOUNT IS UPHELD 6 . WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE MATERIALS PLACED BEFORE US INCLUDING THE ORDERS OF AUTHORITIES BELOW. THE LD. AR SUBMITTED BEFORE US THAT THE ADDITION MADE UNDER SECTION 69A AMOUNTING TO RS.12,05,000/ - WAS TOTALLY WRONG AS THE ASSESSEE HAS EXPLAINED SOURCES WHICH WERE NOT CORRECTLY APPRECIATED BY THE AUTHORITIES BELOW. THE LD. AR SUBMITTED THAT THE ASSESSEE 7 6631 /MUM/ 201 3 HAD OPENING CASH BALANCE AT RS.3,72,000/ - , THE REFUND OF LOAN OF RS.4 LAKHS FROM BROTHER IN - LAW GIVEN IN THE EARLIER YEARS. CASH RECEIVED FROM HUSBAND OF THE ASSESSEE AND OTHER SIMILAR SOURCES WHICH WERE NOT PROPERLY VERIFIED BY THE AO AND VEHEMENTLY P RAYED BEFORE US THAT THE MATTER BE REMITTED BACK TO THE FILE OF T HE AO FOR FRESH CONSIDE RATION AND TO DECIDE THE ISSUE OF ADDITION U/S 69A AFRESH AFTER EVALUATING THE SE EVIDENCE S . SIMILARLY AS REGARD THE ADDITION OF RS.1,78,250/ - , THE AR SUBMITTED THAT THE SAME RELATED TO THE ASSESSMENT YEAR 2008 - 09 AND WAS OFFERED TO TAX IN THAT YEA R AND THIS WAS ALSO NOT CORRECTLY APPRECIATED BY THE AUTHORITIES BELOW IN THE CORRECT PERSPECTIVE AND T HE SAME ALSO MAY BE RESTORED BACK TO THE FILE OF THE AO TO BE DECIDED AFRESH. THE LD. DR STRONGLY OBJECTED TO THE SUBMISSIONS OF THE LD. AR BY SUBMITTING THAT THE ASSESSEE FURNISHED VARIOUS EVIDENCE S WHICH WERE DULY CONSIDERED AND THE ADDITION WAS RIGHTLY MADE BY THE AO AND UPHELD BY THE LD.CIT(A). THUS, HAVING REGARD TO THE ARGUMENT MADE BY THE PARTIE S AND DOCUMENTS PLACED BEFORE US, WE ARE OF THE VIEW THAT IT WOULD MEET ENDS OF JUSTICE IF THE MATTER IS RESTORED BACK TO THE FILE OF AO FOR FRESH ADJUDICATION AFTER AFFORDING FAIR AND REASONABLE OPPORTUNITY OF HEARING TO TH E ASSESSEE . ACCORDINGLY, WE SET ASIDE ORDER OF LD.CIT(A) AND RESTORE THE MATTER TO THE FILE OF AO TO DECIDE THE MATTER DENOVO AFTER AFFORDING A REASONABLE OPPORTUNITY TO THE ASSESSEE. 8 6631 /MUM/ 201 3 7 . IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTIC AL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 8 TH JUNE , 201 6 SD SD ( MAHAVIR SINGH ) ( RAJESH KUMAR) / J UDICIAL MEMBER / A CCOUNTANT MEMBER MUMBAI ; DATED : 8.6. 2016 SR.PS:SRL: / 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 F ILE / BY ORDER, TRUE COPY / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI