JCIT (i/c), CHENNAI V. Smt. G.Suryakala, Vellore

ITA 717/CHNY/2012

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 61344 (ITAT-CHENNAI)
• Duration Of Justice: 3 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-07-2012
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 23-07-2012
• Assessment Year: 2008-2009
• Appeal Filed On: 04-04-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: VI KRAMADITYA
• Assessee Lawyers: A MAHESH
• Keywords: Unexplained investment; Business income
• Section: 143(3); 132

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL B B ENCH C HENN AI BEFORE DR .O.K.NARAYANAN, VICE PRESIDENT AND SHRI CHALLA NAGENDRA PRASAD, JUDICIAL MEMBER .. ITA NO. 717 /MDS./ 20 12 ASSESSMENT YEAR: 200 8 - 2009 THE JT. COMMISSIONER OF INCOME TAX, CENTRAL CIRCL E - IV(1), 46,MAHATMA GANDHI ROAD, NUNGAMBAKKAM, CHENNAI 34. VS. SMT.G.SURYAKALA, 15,14 TH EAST CROSS ROAD, GANDHI NAGAR, VELLORE. PAN ABHPS 8170 K (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI VIKRAMADITYA, JCIT D.R. RESPONDENT BY : SHRI A.MAHESH, FCA DATE OF HEARING : 23 .0 7 .12 DATE OF PRONOUNCEMENT : 27 .0 7 .12 O R D E R PER DR .O.K.NARAYANAN, VICE PRESIDENT : THI S APPEAL IS FILED BY REVENUE. THIS APPEAL IS DIRECTED AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX(APPEALS) - I AT CHENNAI DATED 25.01.2012. THIS APPEAL ARISES OUT OF THE ASSESSMENT COMPLETED UNDER SECTION 143(3) OF THE INCOME TAX ACT, 1961. ITA . 717 /MDS/ 12 2 2. THE RE WAS A SEARCH ACTION ON 06.06.2007 IN ASSESSEE S RESIDENCE UNDER SECTION. 132 OF THE INCOME TAX ACT, 1961. IN FACT, THE SEARCH WAS CARRIED OUT ALONG WITH THE SEARCHES MADE IN THE CASE OF M/S.VELLORE INSTITUTE OF TECHNOLOGY. IN THE COURSE OF SEARCH, CER TAIN DOCUMENTS AND SOME AMOUNT OF JEWELLERY WERE FOUND AND SEIZED. IN THE LIGHT OF THE DETAILS COLLECTED IN THE COURSE OF SEARCH, A NOTICE UNDER SECTION 142 (1) WAS SERVED ON THE ASSESSEE AGAINST WHICH THE ASSESSEE HAS FILED HER RETURN OF INCOME FOR ` 2,7 5,600/ - . IN THE COURSE OF ASSESSMENT PROCEEDINGS, CERTAIN ADDITIONS WERE MADE BY THE ASSESSING AUTHORITY AND AS SUCH THE ASSESSMENT WAS FINALLY COMPLETED ON A TOTAL INCOME OF ` 41,48,730/ - . 3. WHEN THE MATTER WAS TAKEN IN FIRST APPEAL, THE FACTS LEADING TO ALL THE ADDITIONS HAVE BEEN CONSIDERED BY THE COMMISSIONER OF INCOME TAX(APPEALS) IN A DETAILED MANNER. AFTER GOING THROUGH THE FACTS AND CIRCUMSTANCES OF THE CASE AND PARTICULARLY THE REASONS OF ADDITIONS, THE COMMISSIONER OF INCOME TAX(APPEALS) GRAN TED CERTAIN RELIEFS. THE REVENUE IS AGGRIEVED BY THE RELIEFS GRANTED BY THE COMMISSIONER OF INCOME TAX(APPEALS) AND THEREFORE, THE SECOND APPEAL BEFORE THE TRIBUNAL. ITA . 717 /MDS/ 12 3 4 . WE HEARD SHRI VIKRAMADITYA, LEARNED JCIT APPEARING FOR THE REVENUE AND SHRI A.MAHESH , FCA, LEARNED CHARTERED ACCOUNTANT APPEARING FOR THE ASSESSEE . 5. LEARNED DEPARTMENTAL REPRESENTATIVE ARGUED THE CASE AT LENGTH. HE EXPLAINED THAT THE ADDITIONS WERE MADE BY THE ASSESSING AUTHORITY ON THE BASIS OF SOLID MATERIALS AND THE COMMISSIONER OF INCOME TAX(APPEALS) HAS DELETED THEM BY ACCEPTING THE EXPLANATIONS OFFERED BY THE ASSESSEE ALONE , BUT NOT SUPPORTED BY EVIDENCES. LD. OFFICER ARGUED AT LENGTH ON THE ADDITION OF ` 17 LAKHS MADE BY THE ASSESSING OFFICER TOWARDS UNEXPLAINED MONEY FOUND IN TH E COURSE OF SEARCH. 6. LEARNED CHARTERED ACCOUNTANT APPEARING FOR THE ASSESSEE ON THE OTHER HAND, SUPPORTED THE ORDER PASSED BY THE COMMISSIONER OF INCOME TAX(APPEALS) STATING THAT THE COMMISSIONER OF INCOME TAX(APPEALS) HAS GIVEN THE RELIEFS ONLY ON T HE BASIS OF THE EVIDENCES AND EXPLANATIONS OFFERED BY THE ASSESSEE BEFORE HIM. LEARNED CHARTERED ACCOUNTANT EXPLAINED THAT MANY OF THE ISSUES RAISED BY THE REVENUE IN THE PRESE NT APPEAL ARE ALREADY COVERED EITHER BY THE ORDERS OF TRIBUNAL OR ORDERS OF T HE CIT( A) FOR EARLIER ASSESSMENT YEARS AND AS SUCH ITA . 717 /MDS/ 12 4 THERE IS NO BASIS IN ARGUING THAT THE COMMISSIONER OF INCOME TAX(APPEALS) HAS GRANTED RELIEFS WITHOUT ANY BASIS. 7. WE HAVE HEARD BOTH SIDES IN DETAIL. 8. THE FIRST GROUND RAISED BY THE REVENUE IN THE A PPEAL IS THAT THE COMMISSIONER OF INCOME TAX(APPEALS) HAS ERRED IN DELETING THE ADDITIONS MADE BY THE ASSESSING OFFICER TOWARDS BUSINESS INCOME AMOUNTING TO ` 6 LAKHS FROM LEASE OF BUSES. THIS ISSUE WAS CONSIDERED BY ITAT, CHENNAI B BENCH IN ASSESSEE'S OWN CASE WHILE CONSIDERING THE APPEALS FOR THE ASSESSMENT YEARS 2002 - 03 TO 2006 - 07 FILED BEFORE IT. IN THE COMMON ORDER PASSED BY THE TRIBUNAL DATED 20 TH JANUARY, 2012 IN ITA NOS. 1533 TO 1537/MDS./2010 ALONG WITH CROSS OBJECTIONS NOS.150 TO 154/MDS/2010, THE TRIBUNAL HAS DELETED SIMILAR ADDITIONS AFTER EXAMINING THE FACTS OF THE CASE . AS SUCH, WE HAVE TO SEE THAT THE ISSUE IS ALREADY COVERED BY THE DECISION OF THE TRIBUNAL. THE ORDER OF THE COMMISSIONER OF INCOME TAX(APPEALS) ON THIS POINT IS SUSTAINABLE IN LAW. 9. THE NEXT ISSUE RAISED BY THE REVENUE IN THE PRESENT APPEAL IS THAT THE COMMISSIONER OF INCOME TAX(APPEALS) HAS ERRED IN ITA . 717 /MDS/ 12 5 DELETING THE ADDITION OF ` 1,02,291/ - MADE BY THE ASSESSING OFFICER AGAINST INTEREST AND CHIT KAZAR. THIS ISSUE WAS IN FACT DECIDED BY THE COMMISSIONER OF INCOME TAX(APPEALS) IN THE EARLIER ASSESSMENT YEARS IN FAVOUR OF ASSESSEE AND IT IS ON THE BASIS OF THOSE EARLIER YEARS THAT THE COMMISSIONER OF INCOME TAX(APPEALS) HAS DELETED THE SAID ADDITION IN THE IMPUGNED ASSESSMENT YE AR. IT IS TO BE FURTHER SEEN THAT AS STATED IN PARAGRAPH ABOVE, THE TRIBUNAL ALSO HAD CONSIDERED THE APPEALS IN THE CASE OF VERY SAME ASSESSEE FOR ASSESSMENT YEARS 2002 - 03 TO 2006 - 07, THIS ISSUE HAS NOT BEEN RAISED THEREIN. IN THESE CIRCUMSTANCES, WE FI ND THAT THE COMMISSIONER OF INCOME TAX(APPEALS) IS JUSTIFIED IN FOLLOWING HIS EARLIER ORDERS AND GRANTING RELIEF TO THE ASSESSEE. 10. THE THIRD ISSUE RAISED BY THE REVENUE IS THAT THE COMMISSIONER OF INCOME TAX(APPEALS) HAS ERRED IN DELETING THE ADDITIO N OF ` 17 LAKHS MADE BY THE ASSESSING AUTHORITY TOWARDS UNEXPLAINE D MONEY. IT IS THE CASE OF THE REVENUE THAT THE COMMISSIONER OF INCOME TAX(APPE ALS) HAS FAILED TO CONSIDER THE DEPOSITION OF THE ASSESSEE MADE DURING SEARCH A S VALID SINCE NO BOOKS OF ACCOUN T WERE PRODUCED DURING SEARCH AND SHE DID NOT ITA . 717 /MDS/ 12 6 PROVE RECEIPT OF ` 10 LAKHS FROM HER FATHER - IN - LAW AND BALANCE AMOUNT FROM MATURITY OF CHIT FUNDS. 11. THE COMMISSIONER OF INCOME TAX(APPEALS) HAS CONSIDERED THIS ISSUE IN A DETAILED MANNER IN PAGES 3 TO 6 OF HIS ORDER. IN THE COURSE OF SEARCH, THE ASSESSEE HAD GIVEN A STATEMENT THAT ` 13 LAKHS KEPT IN HER BANK LOCKER , WAS NOT ACCOUNTED FOR. IT IS FOR THAT REASON THE AMOUNT OF ` 13 LAKHS WAS ADDED. ANOTHER SUM OF ` 4 LAKHS WAS FOUND AT THE RESIDENCE OF THE ASSES SEE, WHICH ALSO ON THE SAME GROUND ADDED TO THE INCOME OF THE ASSESSEE. IT IS HOW A SUM OF ` 17 LAKHS HAS BEEN ADDED TO THE INCOME OF THE ASSESSEE. THE EXPLANATION OFFERED BY THE ASSESSEE IS THAT SHE HAD RECEIVED ` 10 LAKHS FROM HER FATHER - IN - LAW AND SHE A LSO HAD RECEIVED ` 7 LAKHS FROM MATURITY OF CHIT FUNDS . 12. ON GOING THROUGH THE RECORDS OF THE CASE IN A DETAILED MANNER, THE COMMISSIONER OF INCOME TAX(APPEALS) FOUND THAT THERE WAS AMPLE CASH BALANCE AVAILABLE IN THE CASH BOOK OF THE ASSESSEE. THE CO MMISSIONER OF INCOME TAX(APPEALS) HAS OBSERVED THAT THE BOOKS OF ACCOUNT PRODUCED BY THE ASSESSEE AT THE TIME OF ASSESSMENT HAVE NOT BEEN REJECTED. AS PER THE CASH BOOK, SUFFICIENT CASH BALANCE WAS AVAILABLE ON THE DATE OF ITA . 717 /MDS/ 12 7 OPERATION OF BANK LOCKER AND THE AMOUNT OF ` 13 LAK HS FOUND IN THE BANK LOCKER THUS COVERED BY THE MONEY AVAILABLE IN THE HANDS OF ASSESSEE. AS PER ACCOUNTS, HE ALSO FOUND THAT THE BALANCE AMOUNT OF ` 4 LAKHS IS ALSO SUPPORTED BY THE CASH BALANCE THEN AVAILABLE IN THE HANDS OF THE ASSES SEE. ON GOING FURTHER, THE COMMISSIONER OF INCOME TAX(APPEALS) FOUND THAT THE CASH BALANCES WERE GENERATED FROM BUS OPERATIONS CARRIED ON BY HER AND ALSO ON SALE OF ASSETS AND HER MINOR CHILDREN S SHARE IN HER HUS BAND S RESIDENTIAL PROPERTY AT TIRUVANNAM ALAI. THE COMMISSIONER OF INCOME TAX(APPEALS) ALSO FOUND THAT THE ASSESSEE HAD PRODUCED EVIDENCES IN SUPPORT OF CHIT FUND AMOUNTS, WHICH HAVE NOT BEEN SO FAR DISPROVED. IN THESE CIRCUMSTANCES, THE COMMISSIONER OF INCOME TAX(APPEALS) HAS DELETED THE AMOUN T OF RS.17 LAKHS. 13. ON GOING THROUGH THE RECORDS OF THE CASE, WE FIND THAT EVEN IF THE BOOKS OF ACCOUNTS WERE NOT AVAILABLE AT THE TIME OF SEARCH, THE ASSESSEE HAD MAINTAINED BOOKS AND THEY WERE PRODUCED BEFORE THE ASSESSING AUTHORITY AND THOSE BOOKS W ERE NOT REJECTED IN THE COURSE OF ASSESSMENT. THE BALANCE AVAILABLE IN THE CASHBOOK WAS SUFFICIENT TO COVER THE AMOUNTS POINTED OUT BY THE ASSESSING AUT HORITY. THE ASSESSEE WAS ALSO HAVING BUS ITA . 717 /MDS/ 12 8 OPERATIONS AND THE ASSESSEE HAD ALSO PRODUCED EVIDENCE IN SUP PORT OF CHIT FUND INCOME BEFORE THE ASSESSING AUTHORITY. IN FACT, IT IS NOT A CASE WHERE THE ASSESSEE HAS NOT PRODUCED ANY EVIDENCE, BUT IT IS A CASE WHERE THE EVIDENCES PRODUCED BY THE ASSESSEE WERE REJECTED BY THE ASSESSIN G AUTHORITY. WHEN WE CONSIDER THE ENTIRE ASPECTS, ESPECIALLY IN VIEW OF THE FACT THAT THE CASH BALANCE WAS AVAILABLE IN HER HANDS AS PER CASH BOOK, WE ARE INCLINED TO AGREE WITH THE FINDINGS ARRIVED AT BY THE COMMISSIONER OF INCOME TAX(APPEALS) ON THIS ISSUE. THE COMMISSIONER OF INC OME TAX(APPEALS) HAS DELETED THE ADDITION OF RS.17 LAKHS ON SOUND AND REASONABLE GROUND. THEREFORE, THIS GROUND RAISED BY THE REVENUE IS DISMISSED. 14. THE LAST GROUND RAISED BY THE REVENUE IN THE PRESENT APPEAL IS THAT THE COMMISSIONER OF INCOME TAX(AP PEALS) ERRED IN DELETING THE ADDITION MADE BY THE ASSESSING AUTHORITY AGAINST UNEXPLAINED INVESTMENT IN GOLD JEWELLERY AND DIAMON D S. THIS ISSUE WAS CONSIDERED BY THE COMMISSIONER OF INCOME TAX(APPEALS) IN PAGES 6 TO 11 OF HIS ORDER. AFTER COMPUTING AVAILAB ILITY OF GOLD IN THE HANDS OF DIFFERENT PERSONS OF THE FAMILY, THE COMMISSIONER OF INCOME TAX(APPEALS) HAS ARRIVED AT AN EXCESS QUANTUM IN THE HANDS OF THE ASSESSEE AT 660.600 GRAMS. ITA . 717 /MDS/ 12 9 HE HAS ACCEPTED THE EXPLANATION REGARDING 552 GRAMS OF ORNAMENTS. THE RE LIEF HAS BEEN GRANTED BY THE COMMISSIONER OF INCOME TAX(APPEALS) ON SPECIFIC GROUNDS DISCUSSED BY HIM AFTER EXAMINING THE PARTICULARS PLACED BEFORE HIM. THE FIRST OBSERVATION OF THE COMMISSIONER OF INCOME TAX(APPEALS) IS THAT EVEN AT THE TIME OF SEARCH, TH E ASSESSEE HAD IDENTIFIED THE JEWELLERY AND ITS OWNERSHIP ITEM - WISE. THE JEWELLERY WAS NOT SEIZED AT ONE PLACE AND THEY WERE SEIZED AT DIFFERENT BED ROOMS OF JOINT FAMILY AND AS SUCH NOT POSSIBLE TO HOLD THAT THE ENTIRE JEWELLERY BELONGS TO ASSESSEE HERSE LF. THE ASSESSEE COMING FROM AN AFFLUENT FAMILY, REASONABLE AMOUNT OF JEWELLERY WAS RECEIVED AT THE TIME OF MARRIAGE AND OTHER OCCASIONS FROM HER PARENTS AND OTHER CLOSE RELATIVES. THE COMMISSIONER OF INCOME TAX(APPEALS) ALSO FOUND THAT THE ASSESSEE HAS B EEN GETTING THE SUPPORT OF HER ADOPTIVE FATHER, NATURAL FATHER AS WELL AS HER HUSBAND. IN THESE CIRCUMSTANCES, THE COMMISSIONER OF INCOME TAX(APPEALS) HAS ACCEPTED THE GENUINENESS OF 552 GRAMS OF GOLD ORNAMENTS IN THE ASSESSEE S HANDS. THE COMMISSIONER OF INCOME TAX(APPEALS) HAS DELETED THE ADDITION TOWARDS DIAMONDS AMOUNTING TO ` 50,000 ON THE GROUND THAT THE AMOUNT IS VERY NEGLIGIBLE AND BY ALL MEANS INHERENTLY EXPLAINED BY THE FINANCIAL POSITION OF THE ASSESSEE AND HER FAMILY. ITA . 717 /MDS/ 12 10 1 5. ON GOING THROUGH THE DETAILED DISCUSSION MADE BY THE COMMISSIONER OF INCOME TAX(APPEALS), WE FIND THAT T HE FINDINGS ARRIVED AT BY HIM ARE TO BE ACCEPTED. HE HAS EXAMINED THE STATEMENTS MADE BY DIFFERENT PERSONS AT THE TIME OF SEARCH AND HAS TABULATED THE DETAILS OF GOLD ORNA MENTS AVAILABLE IN THE HANDS OF DIFFERENT PERSONS AND HAS REASONABLY WORKED OUT THE ACCOUNT OF GOLD JEWELLERY IN THE HANDS OF THE ASSESSEE. THEREFORE, WE FIND THAT NO INTERFERENCE IS CALLED FOR IN THE ORDER OF THE COMMISSIONER OF INCOME TAX(APPEALS) ON TH IS ISSUE. 16 . IN RESULT, THIS APPEAL FILED BY REVENUE IS DISMISSED. ORDER PRONOUNCED ON FRIDAY THE 27 TH JULY , 2012 AT CHENNAI. SD/ - SD/ - ( CHALLA NAGENDRA PRASAD ) ( DR.O.K.NARAYANAN ) JUDICIAL MEMBER VICE PRESIDENT CHENNAI, DATED 27 TH JULY , 2012 . K S SUNDARAM COPY TO: ASSESSEE / AO / CIT (A) / CIT / D.R. / GUARD FILE ITA . 717 /MDS/ 12 11