Asstt. Commissioner of Income Tax, Kanpur V. Shri Jeewan Kumar Agarwal, Kanpur

ITA 667/LKW/2013

• Counselvise Citation: [2015] 121 COUNSELVISE.COM (IT) 0724 (ITAT-LUCKNOW)
• Duration Of Justice: 1 year(s) 10 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-07-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 17-06-2015
• Assessment Year: 2006-2007
• Appeal Filed On: 09-09-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: P K KAPOOR
• Keywords: Unexplained cash credit

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH A, LUCKNOW BEFORE SHRI SUNIL KUMAR YADAV, JUDICIAL MEMBER AND SHRI A.K. GARODIA, ACCOUNTANT MEMBER ITA NO.667/LKW/2013 ASSESSMENT YEAR:2006 - 07 SHRI JEEWAN KUMAR AGARWAL, 7/130, SWAROOP NAGAR, KANPUR. PAN:AALPA4280H VS A.C.I.T., CENTRAL CIRCLE - II, KANPUR. (RESPONDENT) (APPELLANT) C.O.NO. 48 /LKW/201 3 (IN ITA NO.667/LKW/2013 ASSESSMENT YEAR:2006 - 07 A.C.I.T., CENTRAL CIRCLE - II, KANPUR. VS SHRI JEEWAN KUMAR AGARWAL, 7/130, SWAROOP NAGAR, KANPUR. PAN:AALPA4280H (RESPONDENT) (OBJECTOR) DR. ANAND KUMAR AGARWAL, C.I.T., D. R. REVENUE BY SHRI P. K. KAPOOR, C.A. ASSESSEE BY 18/06/2015 DATE OF HEARING 24 /07/2015 DATE OF PRONOUNCEMENT O R D E R PER A. K. GARODIA, A.M. THE APPEAL IS FILED BY THE REVENUE AND THE CROSS OBJECTION IS FILED BY THE ASSESSEE, WHICH ARE DIRECTED AGAINST THE ORDER OF CIT(A) - I, KANPUR DATED 07/06/2013 FOR ASSESSMENT YEAR 2006 - 07. 2. FIRST WE TAKE UP THE APPEAL OF THE REVENUE I.E. I.T.A. NO.667/LKW/2013. G ROUND NO. 1 IS AS UNDER: 1. LD. CIT(A) HAS ERRED IN LAW AND ON FACTS IN DELETING THE ADDITIONS OF RS.4,80,000/ - ON ACCOUNT OF RECEIPTS FROM 2 GOPALAYA GUEST HOUSE BY HOLDING THAT ADDITION WAS MADE ON THE BASIS OF SUSPICION, CONJECTURES A ND SURMISES WITHOUT GOING THROUGH THE FACTS OF THE CASE AND WITHOUT ASSIGNING ANY LOGICAL REASON. 3. LEARNED D. R. OF THE REVENUE SUPPORTED THE ASSESSMENT ORDER WHEREAS LEARNED A. R. OF THE ASSESSEE SUPPORTED THE ORDER OF LEARNED CIT(A). 4. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. WE FIND THAT THIS ISSUE WAS DECIDED BY LEARNED CIT(A) AS PER PARA 5.3 OF HIS ORDER, WHICH IS REPRODUCED BELOW FOR THE SAKE OF READY REFERENCE: - 5.3 DECISION THE APPELLANT HAS SHOWN NIL PROFIT (AS AGAINST LOSS OF RS.15,000/ - ) ON ACCOUNT OF RENTING OUT THIS PLACE IN THE ORIGINAL RETURN OF INCOME FILED. THE ADDITION MADE BY THE ASSESSING OFFICER IN THIS REGARD BY INCREASING THE RECEIPTS IS BASED ON SUSPICION, CONJECTURES AND SURMISE, WHICH HAS NO PLACE IN THE IN COME - TAX ASSESSMENT. IN ABSENCE OF ANY EVIDENCE FOUND FOR HAVING MORE RECEIPTS THAN WHAT WAS SHOWN, THE IMPUGNED ADDITION CANNOT SURVIVE. THE ADDITION MADE IS, THEREFORE, DELETED. 4.1 FROM THE ABOVE PARA FROM THE ORDER OF LEARNED CIT(A), WE FIND THAT A CLEAR FINDING HAS BEEN GIVEN BY LEARNED CIT(A) THAT THE ADDITION MADE BY THE ASSESSING OFFICER IN THIS REGARD BY INCREASING THE RECEIPTS IS BASED ON SUSPICION, CONJECTURES AND SURMISE S. WE ALSO FIND THAT THE ASSESSING OFFICER HAS OBSERVED IN THE ASSESSME NT ORDER THAT THERE ARE 40 AUSPICIOUS OCCASIONS FOR MARRIAGE DURING THE YEAR AND THERE MAY BE OTHER SUCH OCCASIONS FOR OTHER RELIGIONS ALSO AND THEREFORE, 9 SUCH BOOKINGS SHOWN BY THE ASSESSEE AND THAT TOO SHOWING CASH RECEIPT ON EACH OCCASION IS NOT SUFFI CIENT AND THEREAFTER , THE ASSESSING OFFICER PROCEEDED TO ESTIMATE THAT THE RECEIPTS FROM GOPALAYA GUEST HOUSE BE TAKEN AT RS.6 LAC AND FROM THAT THE ASSESSING OFFICER REDUCED THE AMOUNT OF RENT PAID BY THE ASSESSEE OF 3 RS.1.20 LAC AND MADE ADDITION OF BALAN CE AMOUNT OF RS.4.80 LAC. HENCE, IT IS SEEN THAT NO BASIS O R MATERIAL HAS BEEN INDICATED BY THE ASSESSING OFFICER TO ESTIMATE THE RECEIPTS FROM GOPALAYA GUEST HOUSE AND THEREFORE, CONSIDERING ALL THE FACTS OF THE PRESENT CASE, WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF CIT(A). ACCORDINGLY, GROUND NO. 1 IS REJECTED. 5. GROUND NO. 2 IS AS UNDER: 2. LD. CIT(A) HAS ERRED IN LAW AND ON FACTS IN DELETING THE ADDITION OF RS.45,43,000/ - ON ACCOUNT OF UNEXPLAINED CASH CREDIT ON THE BASIS OF WRITTEN SUBMISSIONS MADE BY THE ASSESSEE AND IGNORING THE FACT THAT THE ASSESSEE COULD NOT OFFER ANY EXPLANATION REGARDING THE SAME DURING THE COURSE OF ASSESSMENT PROCEEDINGS. 6 . LEARNED D. R. OF THE REVENUE SUPPORTED THE ASSESSMENT ORDER WHEREAS LEARNED A. R. OF THE ASSESSEE SUPPORTED THE ORDER OF LEARNED CIT(A). HE ALSO SUBMITTED THAT THE BANK ACCOUNT IN WHICH THE AMOUNT WAS DEPOSITED IS A JOINT BANK ACCOUNT AND THEREFORE, THE ASSESSING OFFICER WAS NOT JUSTIFIED IN MAKING ADDITION OF ENTIRE DEPOSIT IN THIS BA NK ACCOUNT BEING SB ACCOUNT NO.20788 IN BANK OF INDIA, KASTURBA MARG BRANCH, KANPUR. HE ALSO SUBMITTED A COPY OF THE PASS - BOOK OF THE BANK ACCOUNT TO SHOW THAT THIS IS A JOINT BANK ACCOUNT. HE ALSO DRAWN OUR ATTENTION TO PAGE NO. 69 OF THE PAPER BOOK WHE REIN THERE IS A STATEMENT SHOWING WORKING OF LONG TERM CAPITAL GAIN DECLARED BY THE ASSESSEE OF RS.4,63,458/ - . HE ALSO SUBMITTED THAT A COPY OF THE SALE DEED IS AVAILABLE ON PAGES 14 TO 68 OF THE PAPER BOOK. THEREAFTER, HE SUBMITTED THAT CIT(A) HAS A LTHO UGH DELETED THE ADDITION BUT IT IS ALSO DIRECTED BY HIM TO ASSESSING OFFICER THAT HE SHOULD REVERIFY THE SALE PROCEEDS AND OFFERING OF CAPITAL GAIN TAX BY THE ASSESSEE AND THE JOINT OWNER S . HE SUBMITTED THAT CIT(A) HAS NO POWER TO SET ASIDE THE MATTER TO ASSESSING OFFICER AND THEREFORE, HIS DIRECTION ON THIS ASPECT SHOULD BE EXPUNGED . 4 7 . WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. FIND THAT THIS ISSUE WAS DECIDED BY LEARNED CIT(A) AS PER PARA 7.3 OF HIS ORDER, WHICH IS REPRODUCED BELOW FOR THE SAKE OF READ Y REFERENCE: - 7.3 DECISION: THE LD. A.R. HAS SUBMITTED THAT CREDITS IN THE BANK ACCOUNT WHICH HAVE BEEN ADDED IN THE HANDS OF THE APPELLANT DO NOT BELONG TO THE APPELLANT ALONE; BUT THAT BANK ACCOUNT IS A JOINT BANK ACCOUNT WITH THREE OTHERS. IN THIS BANK ACCOUNT, THE SALE PROCEEDS O F FLATS/SHOPS SOLD IN CLYDE HOUSE WERE BEING DEPOSITED. THE SAID PROPERTY BELONGED TO SEVERAL CO - OWNERS AND THE CAPITAL GAINS ACCRUING ON SUCH SALE, HAS BEEN OFFERED IN THE HANDS OF THE CO - OWNERS INCLUDING THE APPELLANT. DURING THIS YEAR, THE APPELLANT HA S OFFERED CAPITAL GAINS OF RS.4,63,455/ - ON SALE OF FLATS/SHOPS IN CLYDE HOUSE. SIMILARLY, OTHER HAVE OFFERED THEIR SHARES OF CAPITAL GAINS. THE A.O. IS DIRECTED TO RE - VERIFY THE SALE PROCEEDS RECEIVED & DEPOSITED IN THE SAID BANK ACCOUNT FROM THE DOCUMENT S EXECUTED AND HE ALSO RE - VERIFY IF THE CAPITAL GAINS HAS BEEN CORRECTLY OFFERED IN THE HANDS OF THE CO - OWNERS, INCLUDING THE APPELLANT. T HE CAPITAL GAIN HAS BEEN CORRECTLY OFFERED TO TAX, T HE IMPUGNED ADDITION MADE IN THE HANDS OF TH E APPELLANT WOULD ST AND DELETED. 7.1 FROM THE ABOVE PARA FROM THE ORDER OF LEARNED CIT(A), WE FIND THAT A CLEAR FINDING IS GIVEN BY LEARNED CIT(A) THAT THE IMPUGNED BANK ACCOUNT IS A JOINT BANK ACCOUNT. WE HAVE ALSO VERIFIED THIS ASPECT AS PER COPY OF PASSBOOK PRODUCED BEF ORE US AND ON THIS ASPECT, WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF CIT(A). SECONDLY, THIS FINDING IS ALSO GIVEN BY LEARNED CIT(A) THAT THIS PROPERTY BELONGS TO SEVERAL CO - OWNERS AND THE CAPITAL GAINS ACCRUING ON SUCH SALE HAS BEEN OFFERED IN THE HANDS OF THE CO - OWNERS INCLUDING THE ASSESSEE BUT ON THIS ASPECT, THE CIT(A) HAS NOT MADE ANY VERIFICATION AND HAS DIRECTED THE ASSESSING OFFICER TO REVERIFY THE SALE PROCEEDS RE CEIVED AND DEPOSITED IN BANK ACCOUNT AND ALSO DIRECTED THE ASSESSING OFFICER TO REVERIFY THAT THE CAPITAL GAIN HAS BEEN CORRECTLY OFFERED IN THE HANDS OF THE ASSESSEE AS WELL AS CO - OWNERS. ON THIS ASPECT, THIS IS THE CONTENTION OF LEARNED A.R. OF THE ASSE SSEE THAT THIS AMOUNTS TO SET 5 ASIDE BY CIT(A) AND THE SAME I.E. SET ASIDE IS NOT PROPER . WE FIND FORCE IN THIS CONTENTION OF LEARNED A.R. OF THE ASSESSEE BUT IN THE ABSENCE OF ANY FINDING BY CIT(A) THAT THE CAPITAL GAIN OFFERED BY THE ASSESSEE AND THE CO - OWNERS IS PROPER AND CORRECT, WE HAVE ONLY TWO COURSE OF ACTION BEFORE US, EITHER WE RESTORE THE MATTER BACK TO THE FILE OF CIT(A) TO DECIDE THE ISSUE AFRESH AFTER OBTAINING REMAND REPORT FROM THE ASSESSING OFFICER OR TO SET ASIDE THE MATTER TO THE FILE OF THE ASSESSING OFFICER FOR FRESH DECISION AS HAS BEEN DONE BY CIT(A) ALTHOUGH IT WAS NOT WITHIN HIS POWERS. THE ORDER OF CIT(A) IS DATED 07/06/2013 AND THEREFORE, IN OUR CONSIDERED OPINION, IN THE FACTS OF THE PRESENT CASE, THE SECOND OPTION IS MORE SUITA BLE AND THEREFORE, WE DIRECT THE ASSESSING OFFICER TO REVERIFY THE SALE PROCEEDS RECEIVED AND DEPOSITED IN THE BANK ACCOUNT WITH THE DOCUMENTS EXECUTED AND THE ASSESSING OFFICER SHOULD ALSO REVERIFY AS TO WHETHER THE CAPITAL GAIN HAS BEEN CORRECTLY OFFERED BY THE ASSESSEE AND IF IT IS FOUND THAT THE CAPITAL GAIN HAS BEEN CORRECTLY OFFERED BY THE ASSESSEE & THEN THE ADDITION MADE BY THE ASSESSING OFFICER IS NOT JUSTIFIED. IN THIS MANNER, WE DECIDE THIS ISSUE IN FAVOUR OF THE ASSESSEE. THIS GROUND IS REJECT ED WITH THE ABOVE OBSERVATIONS AND DIRECTIONS. 8. GROUND NO. 3 IS AS UNDER: 3. LD. CIT(A) HAS ERRED IN LAW AND ON FACTS IN DELETING THE ADDITION OF RS.4,67,921/ - ON ACCOUNT OF ACCRUED INTEREST ON ICICI BOND ON THE BASIS OF NOTIFICATION NO. F.4 (9) - W&M OF 2003 DATED 13/03/2003 REPORTED IN (2003) 260 ITR 306 (STATUTE) WITHOUT GOING THROUGH THE FACTS OF THE CASE. 9. LEARNED D. R. OF THE REVENUE SUPPORTED THE ASSESSMENT ORDER WHEREAS LEARNED A. R. OF THE ASSESSEE SUPPORTED THE ORDER OF LEARNED CIT(A). 10 . WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. WE FIND THAT THIS ISSUE WAS DECIDED BY LEARNED CIT(A) AS PER PARA 8.3 OF HIS ORDER WHERE HE HAS 6 OBSERVED THAT THERE IS SPECIFIC NOTIFICATION IN CONNECTION WITH THESE BONDS AS PER WHICH THE INTEREST INCOME ON THESE BONDS IS TAX EXEMPT. THE CIT(A) HAS DELETED THIS ADDITION AFTER MAKING THIS OBSERVATIONS AND LEARNED D.R. OF THE REVENUE COULD NOT POINT OUT ANY DEFECT IN THIS OBSERVATION OF CIT(A) AND THEREFORE, WE DECLINE TO INTERFERE IN THE ORDER OF CIT(A) ON TH IS ISSUE BECAUSE WNEN THE INCOME IS TAX EXEMPT, THE ADDITION MADE BY THE ASSESSING OFFICER IS NOT JUSTIFIED. ACCORDINGLY, THIS GROUND IS REJECTED. 1 1 . GROUND NO. 4 IS AS UNDER: 4. LD. CIT(A) HAS ERRED IN LAW AND ON FACTS IN DELETING THE ADDITION OF RS. 18,000/ - ON ACCOUNT OF INCOME FROM HOUSE PROPERTY WITHOUT APPRECIATING THE DETAILED FACTS BROUGHT ON RECORD BY THE A.O. AND WITHOUT ASSIGNING ANY LOGICAL REASONS. 1 2 . LEARNED D. R. OF THE REVENUE SUPPORTED THE ASSESSMENT ORDER WHEREAS LEARNED A. R. OF THE ASSESSEE SUPPORTED THE ORDER OF LEARNED CIT(A). 1 3 . WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. WE FIND THAT THIS ISSUE WAS DECIDED BY LEARNED CIT (A) AFTER CONSIDERI NG THESE SUBMISSIONS OF THE ASSESSEE BEFORE HIM THAT ARYA NAGAR PROPERTY IS OPEN PLOT OF LAND AND THE PROPERTY CONSTRUCTED THEREON WAS SOLD AND INCOME EARNED THERE FROM WAS SHOWN AS LONG TERM CAPITAL GAIN. REGARDING THE SECOND PROPERTY I.E. GENERALGANJ PR OPERTY, IT WAS THE SUBMISSION OF THE ASSESSEE BEFORE THE CIT(A) THAT THIS IS VERY SMALL AND DILAPIDATED PROPERTY AND NOT EVEN IN POSSESSION OF THE ASSESSEE. THE CIT(A) HAS DELETED THIS ADDITION ON THE BASIS OF THESE CONTENTIONS RAISED BEFORE HIM. LEARNED D.R. OF THE REVENUE COULD NOT POINT OUT ANY MISTAKE IN THESE CLAIMS OF THE ASSESSEE BEFORE CIT(A) AND THEREFORE, ON THIS ISSUE ALSO , WE DO NOT FIND ANY REASON TO INTERFERE IN THE ORDER OF CIT(A). THIS GROUND IS REJECTED. 1 4 . IN THE RESULT, THE APPEAL OF THE REVENUE STANDS DISMISSED. 7 1 5 . NOW WE TAKE UP THE CROSS OBJECTION OF THE ASSESSEE. IN ITS CROSS OBJECTION, THE ASSESSEE HAS RAISED AS MANY AS FOUR GROUNDS BUT THEY ARE ONLY TECHNICAL OBJECTIONS AND SINCE WE HAVE DECIDED T HE APPEAL OF THE REVENUE IN FAVOUR OF THE ASSESSEE, THE ISSUES RAISED BY THE ASSESSEE IN CROSS OBJECTION HAVE BECOME OF ACADEMIC INTEREST ONLY AND THEREFORE, WE HOLD THAT NO ADJUDICATION IS CALLED FOR. 1 6 . IN THE RESULT, THE CROSS OBJECTION OF THE ASSESSEE IS DISMISSED. 1 7 . IN THE COMBINED RESULT, THE APPEAL OF THE REVENUE AND CROSS OBJECTION OF THE ASSESSEE ARE DISMISSED. (ORDER WAS PRONOUNCED IN THE OPEN COURT ON THE DATE MENTIONED ON THE CAPTION PAGE) SD/. SD/. (SUNIL KUMAR YADAV) ( A . K. GARODIA ) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 24 /07/2015 *C.L.SINGH COPY OF THE ORDER FORWARDED TO : 1.THE APPELLANT 2.THE RESPONDENT. 3.CONCERNED CIT 4.THE CIT(A) 5.D.R., I.T.A.T., LUCKNOW ASSTT. REGISTRAR