Smt. Satya Bhama Bindal, Mandi Gobindgarh V. ITO, Mandi Gobindgarh

ITA 713/CHANDI/2012

• Counselvise Citation: [2013] 140 COUNSELVISE.COM (IT) 68403 (ITAT-CHANDIGARH)
• Duration Of Justice: 1 year(s) 1 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-08-2013
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 05-08-2013
• Assessment Year: 2008-2009
• Appeal Filed On: 28-06-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Peak credit
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL CHANDIGARH BENCHES A, CHANDIGARH BEFORE SHRI T.R.SOOD, ACCOUNTANT MEMBER AND MS. SUSHMA CHOWLA, JUDICIAL MEMBER ITA NO.713/CHD/2012 (ASSESSMENT YEAR : 2008-09) SMT. SATYA BHAMA BINDAL, VS THE INCOME TAX OFFICER, H.NO. 230, STREET NO. 2, WARD-1, SHYAM NAGAR, MANDI GOBINDGARH. MANDI GOBINDGARH. PAN: ABJPB-2503M (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI SUDHIR SEHGAL RESPONDENT BY : SHRI AKHILESH GUPTA DATE OF HEARING : 05.08.2013 DATE OF PRONOUNCEMENT : 20.08.2013 O R D E R PER SUSHMA CHOWLA, J.M. : THE APPEAL FILED BY THE ASSESSEE IS AGAINST THE ORD ER OF THE COMMISSIONER OF INCOME-TAX (APPEALS), PATIALA DATED 23.05.2012 RELATING TO ASSESSMENT YEAR 2008-09 AGAINST THE ORD ER PASSED UNDER SECTION 143(3) OF THE INCOME TAX ACT, 1961 (IN SHOR T THE ACT). 2. THE GROUNDS OF APPEAL RAISED BY THE ASSESSEE RE AD AS UNDER: 1. THAT THE WORTHY COMMISSIONER OF INCOME TAX (APP EALS), PATIALA HAS ERRED IN CONFIRMING THE ADDITION OF RS. 29,56,000/- AS MADE BY THE ASSESSING OFFICER ON ACC OUNT OF DEPOSITS ON DIFFERENT DATES IN THE BANK ACCOUNT WIT H CENTURION BANK OF PUNJAB. 2. THAT THE WORTHY CIT(A) HAS ALSO ERRED IN NOT CO NSIDERING THAT THE DEPOSITS WERE IN SMALL AMOUNTS, NORMALLY AGGREGATING BETWEEN RS. 5,000/- TO RS. 50,000/- ON DIFFERENT DATES AND THE AMOUNT WAS WITHDRAWN IMMEDIATELY THER EAFTER LEAVING HARDLY ANY BALANCE IN THE ACCOUNT OF THE AS SESSEE. 2 3. THAT NOTWITHSTANDING THE ABOVE SAID GROUND OF APPEA L, THE CIT (A) HAS ERRED IN NOT CONSIDERING THE ALTERN ATE SUBMISSIONS OF THE ASSESSEE THAT IF AT ALL, ANY ADD ITION IS CALLED FOR THAT COULD BE ON ACCOUNT OF PEAK BALANCE ON 08.09.2007 AMOUNTING TO RS. 55,923/-. 4. THAT THE CIT (A) HAS FAILED TO CONSIDER THE SUBMISS IONS AS MADE BEFORE HIM IN A RIGHT PROSPECTIVE. 5. THAT THE APPELLANT CRAVES LEAVE TO ADD OR AMEND ANY GROUNDS OF APPEAL BEFORE THE APPEAL IS FINALLY HEAR D OR DISPOSED OFF. 4. THE ISSUE RAISED IN THE PRESENT APPEAL IS AGAINS T THE ADDITION MADE ON ACCOUNT OF VARIOUS DEPOSITS ON DIFFERENT DATES I N THE BANK ACCOUNT WITH CENTURIAN BANK OF PUNJAB. 5. THE BRIEF FACTS RELATING TO THE ISSUE ARE THAT T HE ASSESSEE HAD FILED RETURN OF INCOME DECLARING TOTAL INCOME OF RS.18,07 0/-. THE ASSESSEE WAS AN INSURANCE AGENT AND WAS RECEIVING COMMISSIO N FROM LIC OF INDIA, MANDI GOBINDGARH. DURING THE YEAR UNDER CON SIDERATION, THE ASSESSING OFFICER FOUND THAT THE ASSESSEE HAD DEPOS ITED RS.29,56,000/- IN CASH ON DIFFERENT DATES IN HER SAVING ACCOUNT WI TH CENTURIAN BANK OF PUNJAB, MANDI GOBINDGARH. THE ASSESSEE WAS SHOW CA USED TO EXPLAIN THE SOURCE OF DEPOSIT OF THE SAID CASH IN HER BANK ACCOUNT. THE EXPLANATION OF THE ASSESSEE WAS THAT THE BANK ENTRI ES WERE ROTATED ON THE ADVICE OF HER BANK CONSULTANT AND EVERY TIME ASSESS EE VISITED HER RELATIVES AT MUKTSAR, MALAUT AND KOTAKPURA, ASSESSE E DEPOSITED CASH IN HER BANK ACCOUNT, WHICH WAS WITHDRAWN ALSO. THE SEC OND PLEA OF THE ASSESSEE WAS THAT AT MAXIMUM, THE PEAK WAS RS.55,00 0/- WHICH WAS ROTATED THROUGH HER ACCOUNT. THE ASSESSING OFFICER REJECTING THE EXPLANATION OF THE ASSESSEE MADE AN ADDITION OF RS. 29,56,000/- AS INCOME FROM UNEXPLAINED SOURCES. THE CIT(APPEALS), REJECTING THE PLEA OF THE ASSESSEE, UPHELD THE ADDITION OF RS.29,56,00 0-. THE ASSESSEE IS IN APPEAL AGAINST THE ORDER OF THE CIT(APPEALS). 3 6. THE LD. AR FOR THE ASSESSEE POINTED OUT THAT THE ASSESSEE HAD DEPOSITED CASH ON VARIOUS DATES WHICH WAS ALSO WITH DRAWN ON VARIOUS DATES ON THE ADVICE OF A BANK CONSULTANT, IN ORDER TO OBTAIN LOAN FROM THE BANK. THE LD. AR FURTHER SUBMITTED THAT AT BEST, W HAT CAN BE ADDED IN THE HANDS OF THE ASSESSEE WAS A PEAK CREDIT OF RS.5 5,923/- I.E. THE PEAK BALANCE AS ON 08.09.2007. 7. THE LD. DR FOR THE REVENUE POINTED OUT THAT THER E IS NO PROOF OF THE PLEA RAISED BY THE ASSESSEE IN RESPECT OF OBTAINING BANK LOAN AND IN THE ABSENCE OF THE SAME, THERE WAS NO MERIT IN THE SUBM ISSIONS MADE BY THE ASSESSEE. RELIANCE WAS PLACED BY THE LD. DR FOR TH E REVENUE ON THE ORDERS OF THE AUTHORITIES BELOW IN RESPECT OF THE A DDITIONS MADE. 8. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE RECORD. THE ASSESSEE WAS A LIC AGENT AND HAD EARNED INCOME FROM COMMISSION. HOWEVER, DURING THE YEAR UNDER CONSIDERATION I.E. T HE FINANCIAL YEAR 2007-08, THE ASSESSEE HAD DEPOSITED VARIOUS AMOUNTS IN THE BANK ACCOUNT AND HAD ALSO MADE CASH WITHDRAWALS ON DAY-TO-DAY BA SIS. THE TOTAL DEPOSITS IN CASH IN CENTURIAN BANK OF PUNJAB LTD. D URING THE FINANCIAL YEAR WAS RS.30,13,018/-. THE ASSESSEE HAD WITHDRAW N A SUM OF RS.30,59,283/- FROM THE SAID BANK ACCOUNT DURING TH E YEAR. THE SAID FIGURES ARE AS CITED BY THE CIT(APPEALS) IN PARA 4. 1 AT PAGE 3 OF THE APPELLATE ORDER. THE ASSESSEE HAS FURNISHED ON REC ORD THE COPY OF BANK ACCOUNT AT PAGES 3 TO 12 OF THE PAPER BOOK. THE PE RUSAL OF THE SAID BANK ACCOUNT REFLECTS THE ASSESSEE HAVING MADE DEPOSITS IN DIFFERENT DENOMINATIONS ON DIFFERENT DATES AND THE SAME REPEA TEDLY WITHDRAWN EITHER ON THE SAME DAY OR ON THE NEXT DAY. IN VIEW OF THE SAID TRANSACTIONS OF CASH DEPOSIT ON ONE DATE AND WITHDR AWAL ON THE SUCCEEDING DATES, WE FIND MERIT IN THE PLEA RAISED BY THE ASSESSEE IN RESPECT OF THE SAID CASH DEPOSITS AND CASH WITHDRAW ALS FROM THE BANK 4 ACCOUNT. HOWEVER, IN THE ABSENCE OF ANY EXPLANATION FILED IN RESPECT OF CASH AMOUNT UTILIZED FOR MAKING THE INITIAL CASH DE POSIT AND ALSO VARIOUS DEPOSITS AND WITHDRAWALS CLAIMED TO BE MADE IN CASH ON DAY-TO-DAY BASIS, WE HOLD THAT THE CONCEPT OF PEAK THEORY NEED S TO BE APPLIED TO THE FACTS OF THE PRESENT CASE BOTH IN RESPECT OF THE OP ENING INTRODUCTION OF CASH IN HAND AND VARIOUS TRANSACTIONS OF CASH DEPOS ITS AND WITHDRAWALS DURING THE YEAR UNDER CONSIDERATION. IN ORDER TO V ERIFY THE CLAIM OF THE ASSESSEE AND TO DETERMINE THE QUANTUM OF ADDITION, WE RESTORE THE ISSUE BACK TO THE FILE OF ASSESSING OFFICER TO FIRST DETE RMINE THE DEPOSIT OF CASH AT THE START OF THE YEAR AND IN CASE THE SAME IS NOT RELATABLE TO CASH WITHDRAWN DURING THE YEAR BEFORE THAT DATE, THEN SU CH AMOUNT IS TO BE INCLUDED AS INCOME OF THE ASSESSEE. FURTHER, THE P EAK THEORY IS TO BE APPLIED TO THE VARIOUS ENTRIES OF CASH DEPOSIT AND WITHDRAWAL DURING THE YEAR UNDER CONSIDERATION IN ORDER TO DETERMINE THE ADDITION IN THE HANDS OF THE ASSESSEE ON THE BASIS OF PEAK THEORY. IN VI EW THEREOF, THE GROUNDS OF APPEAL RAISED BY THE ASSESSEE ARE ALLOWED FOR ST ATISTICAL PURPOSES. 8. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 20 TH DAY OF AUGUST, 2013. SD/- SD/- (T.R.SOOD) (SUSHMA CHOWLA) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 20 TH AUG.2013 POONAM COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT 4. THE CIT(A) 5. THE DR BY ORDER ASSISTANT REGISTRAR, ITAT, CHANDIGARH