Chintalapati Srinivas, Hyderabad V. Dy. Commissioner of Income Tax ,Central Circle-6, Hyderabad

ITA 70/Hyd/2018

• Counselvise Citation: [2019] 116 COUNSELVISE.COM (IT) 4799 (ITAT-HYDERABAD)
• Duration Of Justice: 1 year(s) 7 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-08-2019
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: DB-A
• Next Hearing Date: 05-08-2019
• Assessment Year: 2008-2009
• Appeal Filed On: 08-01-2018
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: T MADHAN
• Assessee Lawyers: A V RAGHURAM
• Keywords: Unexplained cash credit; Search and seizure; Salary income

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCHES A-SMC, HYDERABAD BEFORE SMT. P. MADHAVI DEVI, JUDICIAL MEMBER AND SHRI S. RIFAUR RAHMAN, ACCOUNTANT MEMBER I.T.A. NO. 70/HYD/2018 ASSESSMENT YEAR: 2008-09 SRI CHINTALAPATI SRINIVAS, HYDERABAD [PAN: ADHPC9045R] VS DCIT, CENTRAL CIRCLE-6, HYDERABAD (APPELLANT) (RESPONDENT) FOR ASSESSEE : SHRI A.V. RAGHU RAM, AR FOR REVENUE : SHRI T. MADHAN, DR DATE OF HEARING : 05-08-2019 DATE OF PRONOUNCEMENT : 09-08-2019 O R D E R PER S. RIFAUR RAHMAN, A.M. : THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAINS T THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS)11 , HYDERABAD, DATED 15-11-2017, FOR THE AY.2008-09. 2. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE, AN INDIVIDUAL, DERIVING INCOME FROM SALARY, FROM DLF C OMPANY HAS NOT FILED THE RETURN OF INCOME FOR THE AY.2008-09. A SEARCH AND SEIZURE OPERATION U/S.132 OF THE INCOME TA X ACT [ACT] WAS CONDUCTED IN THE RESIDENTIAL PREMISES OF ASSE SSEE ON 17-10-2007. ACCORDINGLY, NOTICE U/S.148 R.W.S. 153 A OF THE ACT WAS ISSUED ON 04-11-2009. IN RESPONSE TO THE SAID NOTICE, ASSESSEE FILED HIS RETURN OF INCOME FOR THE AY.2008-0 9 ON ITA NO. 70/HYD/2018 :- 2 -: 20-11-2009, ADMITTING AN INCOME OF RS.27,78,220/-. TH E ASSESSMENT WAS COMPLETED U/S.143(3) OF THE ACT ON 31-1 2- 2009 WITH AN ADDITION OF RS.2,26,825/- TOWARDS UNEXPL AINED INVESTMENT U/S.69A OF THE ACT AND RS.17,65,000/- TOWAR DS UNEXPLAINED CASH CREDITS U/S.68 OF THE ACT. 2.1. AGGRIEVED WITH THE ABOVE ORDER, THE ASSESSEE PRE FERRED AN APPEAL BEFORE THE CIT(A). AFTER CONSIDERING THE SUBM ISSIONS OF ASSESSEE, LD.CIT(A) DELETED THE ADDITION OF RS.2,26,8 25/- AND NOTICED THAT ASSESSEE HAS RECEIVED LOANS FROM SHRI SA NDEEP REDDY AND SHRI SIVAPRASAD REDDY, NRIS TO THE EXTENT OF RS.14,65,000/- AND 5,00,000/- RESPECTIVELY. BOTH THE LOANS ARE AMOUNTING TO RS.19,65,000/-. WHEREAS THE AO MADE ADDITION OF RS.17,65,000/-. ACCORDINGLY, LD.CIT(A) I SSUED NOTICE TO THE ASSESSEE FOR THE ENHANCEMENT. SINCE, NONE APPEARED BEFORE HIM, THE APPEALS WERE DISMISSED BY TH E LD.CIT(A) WITH ENHANCEMENT. 2.2. AGGRIEVED WITH THE ABOVE ORDER OF LD.CIT(A), ASS ESSEE PREFERRED AN APPEAL BEFORE US, BY RAISING THE FOLLOW ING GROUNDS: 1. THE ORDER OF THE LEARNED CIT(A) ERRONEOUS BOTH ON FACTS AND IN LAW TO THE EXTENT IT IS PREJUDICIAL TO THE ASSESSEE. 2. THE LEARNED CIT(A) ERRED IN CONFIRMING THE ADDIT ION MADE AS UNEXPLAINED CASH DEPOSITS BY ENHANCING IT TO RS.19, 65,000/-. 3. THE LEARNED CIT(A) ERRED IN HOLDING THAT THE ASS ESSEE HAS NOT FILED THE REQUIRED DOCUMENTS THOUGH HAS NOT GRANTED TIME REQUEST FOR WHICH WAS MADE THROUGH MAIL MESSAGE DT.30-8-2017 TO FILE SUCH DOCUMENTS AND THEREBY ERRED IN ENHANCING AND CONFIR MING THE ADDITION OF RS.19,65,000/-. ITA NO. 70/HYD/2018 :- 3 -: 4. THE LEARNED CIT(A) FURTHER FAILED TO APPRECIATE THE FACT THAT THE APPELLANTS ONLY SOURCE OF INCOME IS SALARY AND THE RE CANNOT BE ANY UNDISCLOSED INCOME TO MAKE DEPOSITS TO TREAT THEM A S UNEXPLAINED AND THUS ERRED IN CONFIRMING THE DEPOSITS AS UNEXPL AINED. 5. ANY OTHER GROUND THAT MAY BE URGED AT THE TIME O F HEARING. 3. BEFORE US, LD.AR SUBMITTED THAT ASSESSEE HAS RECEIVE D LOANS FROM SHRI SANDEEP REDDY AND SHRI SIVAPRASAD R EDDY, BOTH ARE NRIS. WITH REGARD TO LOAN TAKEN FROM SHRI SA NDEEP REDDY, HE SUBMITTED THAT ASSESSEE DOES NOT HAVE GOOD RELATIONSHIP WITH SHRI SANDEEP REDDY. THEREFORE, HE COULD NOT GET CONFIRMATION LETTER IN ORDER TO SUBMIT BEFORE THE TAX AUTHORITIES AND EVEN NOW, THE RELATIONSHIP HAS NOT IMPR OVED, THAT IS THE REASON WHY ASSESSEE COULD NOT SUBMIT ANY CONFIRMATION LETTER FROM HIM. WITH REGARD TO LOAN TAKEN FROM SHRI SIVAPRASAD REDDY, HE SUBMITTED THAT ASSESSEE FURNI SHED CONFIRMATION LETTER, WHICH WAS RECEIVED THROUGH E-MAIL , WHICH WAS SUBMITTED BEFORE THE AO AND CIT(A). BUT THE SAME WA S NOT ACCEPTED FOR THE REASON THAT IT WAS RECEIVED THROUGH E-MAIL. HE SUBMITTED THAT NOW THE ASSESSEE HAS SUBMITTED A LETTER OF CONFIRMATION FROM SHRI SIVAPRASAD REDDY, WH ICH IS PLACED ON RECORD. HE SUBMITTED THAT IT MAY BE REMITTED B ACK TO THE FILE OF AO FOR PROPER VERIFICATION OF THE CONFIR MATION LETTER. 4. ON THE OTHER HAND, LD.DR SUPPORTED THE ORDERS OF REVENUE AUTHORITIES AND GRACIOUSLY AGREED TO REMIT THE ISSUE BACK TO THE FILE OF AO FOR VERIFICATION. ITA NO. 70/HYD/2018 :- 4 -: 5. CONSIDERED THE RIVAL SUBMISSIONS AND MATERIAL ON RECORD. WE FIND THAT EVEN THOUGH ASSESSEE HAS MADE FIVE GROUND S OF APPEAL, GROUND NOS.1 AND 5 ARE GENERAL IN NATURE. H OWEVER, LD.AR PREFERRED TO SUBMIT BEFORE US THE ISSUE RELATING TO SHRI SIVAPRASAD REDDY, FROM WHOM ASSESSEE HAS SUBMITTED CONFIRMATION LETTER, CONFIRMING THE RECEIPT OF LOAN FR OM HIM. SINCE IT WAS NOT SUBMITTED BEFORE THE AO, WE DEEM IT FIT AND PROPER TO REMIT THIS ISSUE TO THE FILE OF AO TO VERIFY THE CONFIRMATION LETTERS SUBMITTED BY THE ASSESSEE AND WE DI RECT THE AO TO DELETE THE ADDITION WITH RESPECT TO THE LOAN TAK EN FROM SHRI SIVAPRASAD REDDY, AFTER DUE VERIFICATION. 5.1. WITH REGARD TO LOAN RECEIVED FROM SHRI SANDEEP R EDDY, ASSESSEE HAS NOT SUBMITTED ANY CONFIRMATION LETTER, REA SONS BEST KNOWN TO ASSESSEE. SINCE THERE WAS NO CONFIRMATIO N FROM SHRI SANDEEP REDDY, WE ARE SUSTAINING THE ADDITION MAD E BY THE AO. ACCORDINGLY, GROUNDS RAISED BY ASSESSEE ARE PARTLY ALLOWED. 6. IN THE RESULT, THE APPEAL OF ASSESSEE IS PARTLY ALLO WED. ORDER PRONOUNCED IN THE OPEN COURT ON 9 TH AUGUST, 2019 SD/- SD/- (P. MADHAVI DEVI) (S. RIFA UR RAHMAN) JUDICIAL MEMBER ACCOUNTANT M EMBER HYDERABAD, DATED 9 TH AUGUST, 2019 TNMM ITA NO. 70/HYD/2018 :- 5 -: COPY TO : 1. SRI CHINTALAPATI SRINIVAS, C/O. K.VASANT KUMAR, A.V. RAGHU RAM, P.VINOD & M.NEELIMA DEVI, ADVOCATES, 610 , BABUKHAN ESTATE, BASHEERBAGH, HYDERABAD. 2. THE DCIT, CENTRAL CIRCLE-6, HYDERABAD. 3. CIT(APPEALS)-11, HYDERABAD. 4. PR.CIT(CENTRAL), HYDERABAD. 5. D.R. ITAT, HYDERABAD. 6. GUARD FILE.