Shri Shaileshbhai Chandubhai Patel, Ahmedabad V. The Income Tax Officer, Ward-9(4), Ahmedabad

ITA 724/AHD/2015

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 5789 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 1 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-05-2017
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: SMC
• Next Hearing Date: 08-03-2017
• Assessment Year: 2010-2011
• Appeal Filed On: 31-03-2015
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: RICHHA RASTOGI
• Keywords: Unexplained investment

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH, AHMEDABAD BEFORE SHRI N.K. BILLAIYA, ACCOUNTANT MEMBER AND SHRI MAHAVIR PRASAD, JUDICIAL MEMBER !# I.T.A. NO.724/AHD/2015 ( / ASSESSMENT YEAR : 2010-11) SHRI SHAILESHBHAI CHANDUBHAI PATEL, 3, SAMTA BUNGLOW, NEAR BIDIWALA PARK, SATELLITE CROSS ROAD, AHMEDABAD - 380015 # VS. ITO WARD (4) AHMEDABAD. $ # % & # PAN/GIR NO. : ABFPP 2970 A ( !$' / APPELLANT ) .. ( ($' # RESPONDENT ) !$') # APPELLANT BY : --NONE-- ($'*) / RESPONDENT BY : MS. RICHHA RASTOGI, SR. DR + ,*-. / DATE OF HEARING 08/03/2017 /012*-. / DATE OF PRONOUNCEMENT 29/05/2017 3# O R D E R PER SHRI MAHAVIR PRASAD, JUDICIAL MEMBER : THIS IS AN APPEAL BY THE ASSESSEE DIRECTED AGAIN ST THE ORDER OF THE COMMISSIONER OF INCOME TAX(APPEALS)-III, AHMEDABAD, DATED 26/02/2015 FOR THE ASSESSMENT YEAR (AY) 2010-11. 2. ASSESSEE HAS TAKEN THE FOLLOWING GROUNDS OF APPE ALS: I. WITHOUT PREJUDICE TO THE GROUND AT SR. NO. (2) ABOV E, THE LEARNED COMMISSIONER OF INCOME TAX HAS FOLLOWED AN ERRONEOU S METHOD ITA NO. 724/AHD /2015 SHRI SHAILESHBHAI CHANDUBHAI PATEL VS. ITO ASST.YEAR 2010-11 - 2 - IN ARRIVING AT THE TIME OF MAKING DECIDING THE DISP UTED GROUND OF MY APPEAL FOR LIC POLICIES HOWEVER SUCH INVESTMENTS HAVING BEEN MADE FROM SAVINGS AND AVAILABLE FUNDS OF ME AN D MY FAMILY MEMBERS FOR THE YEAR UNDER REVIEW ADDITIONS OF RS.7 ,00,000/- TO THE INCOME. ALL MEMBERS ARE ASSESSED TO TAX. THE DE TAILS OF WITHDRAWALS FOR THE FIVE YEARS WERE SUBMITTED TO JU STIFY THE SAME. THE SAME ADDITIONS TO BE DECIDED IN MY FAVOUR ACCOR DINGLY DESERVES TO BE DELETED AND THIS GROUND IS ALLOWABLE MAKING TO THE FACTS AND CIRCUMSTANCES OF MY CASE. II. REGARDING THE ADDITIONS OF RS.50,000/- FOR TRUC K LABOUR ON ESTIMATE BASIS ALL SUCH DETAILS FOR PAYMENT AND EVI DENCES PRODUCED BEFORE AO AND DULY VERIFIED BY HIM HENCE T HIS GROUNDS OF APPEAL IS ALSO TO BE ALLOWABLE . 3. THE RELEVANT FACTS AS CULLED OUT FROM THE MATERI ALS ON RECORD ARE AS UNDER:- IN THIS CASE OF ASSESSEE, INFORMATION WAS RECEIVE D FROM INCOME TAX OFFICER (INV.), UNIT-II, AHMEDABAD THAT THE ASS ESSEE HAS PURCHASED 14 POLICIES OF LIFE INSURANCE CORPORATION OF INDIA WORTH RS.70,00,000/- IN CASH DURING F.Y. 2009-10 RELEVANT TO A.Y. 2010-1 1. HOWEVER, ON VERIFICATION OF THE CASE RECORDS, IT IS NOTICED THA T THE ASSESSEE HAS NOT SHOWN THE INVESTMENT MADE LIC POLICIES OF RS.7,00,0 00/- AND SOURCE THEREOF REMAINED UNEXPLAINED. LOOKING TO THE ABOVE, A SHOW CAUSE NOTICE WAS ISSUED AS FOLLOWS: AS PER THE INFORMATION AVAILABLE ON RECORD IN YOUR CASE YOU HAVE PURCHASED 14 POLICIES OF LIFE INSURANCE CORPORATION OF INDIA FOR RS.7,00,000/- IN CASH DURING F.Y.2009-10 RELEVANT T O A.Y. 2010-11. IN THE RETURN OF INCOME OR THE DETAILS FURNISHED BY YO U DURING THE COURSE OF ASSESSMENT PROCEEDINGS FOR THE YEAR UNDER CONSIDERA TION THE INVESTMENT OF RS.7,00,000/- MADE IN CASH DOES NOT APPEAR. UNDE R THE CIRCUMSTANCES YOU ARE REQUESTED TO SHOW CAUSE AS TO WHY AN AMOUNT TO ITA NO. 724/AHD /2015 SHRI SHAILESHBHAI CHANDUBHAI PATEL VS. ITO ASST.YEAR 2010-11 - 3 - RS.7,00,000/- SHOULD NOT BE ADDED IN YOUR CASE TREA TING THE SAME AS UNDISCLOSED THE INCOME. THE ASSESSEE HAS FILED HIS REPLY AS UNDER: REGARDING LIC POLICIES OR INVESTMENT: AS EXPLAIN HERE IN BEFORE THROUGH OUR PREVIOUS LETT ER AND SUBMISSIONS TO YOUR GOOD HONOUR, ALL THESE POLICIES WERE TAKEN FRO M AVAILABLE FUNDS AND OR CASH ON HAND OF ALL MY FAMILY MEMBERS AT THE TIME OF INVESTMENT DURING THE YEAR UNDER REVIEW BY ME. HOWEVER I AM EN CLOSING HERE WITH THE COPY OF THE BANK STATEMENTS OF HDFC BANK FOR FI NANCIAL YEAR 2013- 14 IN WHICH ALL THE MATURITY AMOUNT OF THE POLICIES HAVE BEEN RECEIVED AND VERY WELL REFLECTED. ON VERIFICATION OF THE DETAILS SUBMITTED DURING THE COURSE OF ASSESSMENT PROCEEDINGS AND THE ACCOUNTS FILED ALONG WITH THE R ETURN OF INCOME, IT IS NOTICED THAT THE ASSESSEE HAS DEBITED TRUCK LABO UR CHARGES OF RS.8,58,486/- IN THE PROFIT AND LOSS ACCOUNT. ON VE RIFICATION OF DETAILS OF SUCH EXPENSES IT IS NOTICED THAT SOME OF THE PAY MENT ARE MADE BY P&L VOUCHERS AND SOME OF THE EXPENSES SHOWN THE SUP PORTING EVIDENCE ARE NOT FULLY AVAILABLE. LOOKING INTO ABOVE FACTS, ASSESSEE WAS ASKED TO EXPLAIN AS TO WHY OUT OF TRUCK LABOUR CHARGES OF RS .8,58,486/- WHY AN AMOUNT OF RS. 50,000/- SHOULD NOT BE ADDED TO THE T OTAL INCOME. THE ASSESSEE HAS NOT TAKEN ANY OBJECTION FOR THE ABOVE DISALLOWANCE. ACCORDINGLY DISALLOWANCE OF RS.50,000/- WAS MADE, 4. AGAINST THE SAID ORDER ASSESSEE PREFERRED FIRST STATUTORY APPEAL BEFORE THE LEARNED CIT(A). LEARNED CIT(A) HELD THAT ASSESSEE PURCHASED 14 POLICIES FOR THE IMPUGNED AMOUNT OF RS.7,00,000/ - THAT THE APPELLANT WAS UNABLE TO FURNISH ANY SATISFACTORY EXPLANATION. THESE POLICIES ARE IN THE NAME OF APPELLANT AND NOT IN THE NAME OF HIS FA MILY MEMBERS WHEREAS THE APPELLANT HAS CLAIMED THAT WITHDRAWALS OF ALL FAMILY MEMBERS ARE USED FOR MAKING INVESTMENT IN THESE POL ICIES. DURING APPELLATE PROCEEDINGS AS WELL AS APPELLANT HAS REIT ERATED THE STAND TAKEN ITA NO. 724/AHD /2015 SHRI SHAILESHBHAI CHANDUBHAI PATEL VS. ITO ASST.YEAR 2010-11 - 4 - DURING ASSESSMENT PROCEEDINGS. HE HAS ALSO STATED T HAT HE HAD TAKEN THESE POLICIES TO SAFEGUARD THE INTEREST OF HIS FAMILY. W HILE THE EXISTENCE OF THE LIC POLICIES OR THE NEED THEREOF IS NOT DOUBTED, TH E APPELLANTS EXPLANATION FOR PURCHASING THE SAME IN CASH AND EXP LAINING THE SOURCE OF THE SAME AS WITHDRAWALS FOR HOUSEHOLD EXPENSES DOES NOT SEEN PLAUSIBLE, ESPECIALLY IN VIEW OF THE FACT THAT HE WAS UNABLE T O GIVE DETAILS OF HIS LIC AGENT AS WELL. THEREFORE, LEARNED CIT(A) HAD NO REA SON TO INTERFERE WITH THE DECISION IN MAKING ADDITION OF RS.7,00,000/- U/ S. 69 AS UNEXPLAINED INVESTMENT AND THE SAME WAS THEREFORE CONFIRMED. SO FAR AS GROUND REGARDING ADDITION OF RS.50,000/- ON ACCOUNT OF TRU CK LABOUR CHARGES ARE CONCERNED. SINCE THE PAYMENT OF THESE EXPENSES WERE NOT FULLY VERIFIABLE. DURING THE ASSESSMENT PROCEEDING ASSESSEE HAS NOT T AKEN ANY OBJECTION FOR THE ABOVE DISALLOWANCE. 5. WE HAVE GONE THROUGH THE RELEVANT RECORD AND IMP UGNED ORDER. WE DO NOT FIND ANY REASON TO INTERFERE IN THE ORDER PASSED BY THE LEARNED CIT(A) BECAUSE ASSESSEE HAS FAILED TO GIVE ANY SATI SFACTORY EXPLANATION WITH REGARD TO LIC POLICIES AND FOR RS.50,000/- PAI D FOR TRUCK TRANSPORTATION AND HE HIMSELF HAS AGREED FOR THE SA ME BEFORE THE AO AND HE HAD NO OBJECTION BEFORE THE ASSESSING OFFICER. I N VIEW OF THE ABOVE, WE DO NOT FIND ANY INFIMITY IN THE ORDER PASSED BY THE LEARNED CIT(A). THEREFORE, APPEAL OF THE ASSESSEE IS DISMISSED. ITA NO. 724/AHD /2015 SHRI SHAILESHBHAI CHANDUBHAI PATEL VS. ITO ASST.YEAR 2010-11 - 5 - 6. IN THE RESULT, APPEAL FILED BY THE ASSESSEE IS D ISMISSED. THIS ORDER PRONOUNCED IN OPEN COURT ON 29/05/2017 SD/- SD/- ( ) 4 5 ( N.K. BILLAIYA ) ( MAHAVIR PRASAD ) ACCOUNTANT MEMBER JUDICIAL MEMBER AHMEDABAD; DATED 29/05/2017 PRITI YADAV, SR.PS !'#$ %$' # COPY OF THE ORDER FORWARDED TO : 1. !$' / THE APPELLANT 2. ($' / THE RESPONDENT. 3. 67- + 8- / CONCERNED CIT 4. + 8- 4!5 / THE CIT(A)-III, AHMEDABAD. 5. 9:;-67 !.!672 ! / DR, ITAT, AHMEDABAD 6. ;<=, # GUARD FILE. & / BY ORDER, (9-- //TRUE COPY// '/ () ( DY./ASSTT.REGISTRAR) , / ITAT, AHMEDABAD TRUE COPY 1. DATE OF DICTATION 22/05/2017 (DICTATION-PAD 3 PAGES ATTACHED AT THE END OF THIS APPEAL-FILE) 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER 23/05/2017 3. OTHER MEMBER 4. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR.P. S./P.S 26/05/2017 5. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE D ICTATING MEMBER FOR PRONOUNCEMENT 6. DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR.P .S./P.S. 7. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 29/05/2017 8. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK ... 9. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT RE GISTRAR FOR SIGNATURE ON THE ORDER.. 10. DATE OF DESPATCH OF THE ORDER