ACIT, Patiala V. Sh. Joginder Paul, Mandi Gobindgarh

ITA 734/CHANDI/2014

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 86113 (ITAT-CHANDIGARH)
• Duration Of Justice: 4 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-01-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 22-12-2014
• Assessment Year: 2010-2011
• Appeal Filed On: 20-08-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MANJIT SINGH

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL CHANDIGARH BENCHES A CHANDIGARH BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER AND SHRI T.R. SOOD, ACCOUNTANT MEMBER ITA NO. 734/CHD/2014 ASSESSMENT YEAR: 2010-11 THE ACIT, CENTRAL CIRCLE, VS SHRI JOGINDER PAUL, PATIALA C/O M/S JAY INDUSTIES, MANDI GOBINDGARH PAN NO.ACWPP2974A (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI MANJIT SINGH RESPONDENT BY : S/SHRI SUDHIR SEHGAL & ASHOK GOYA L DATE OF HEARING : 22.12.2104 DATE OF PRONOUNCEMENT : 12/1/2015 ORDER PER T.R.SOOD, A.M. THE APPEAL FILED BY THE REVENUE DIRECTED AGAINST TH E ORDER DATED 7.5.2015 OF CIT(A)-I, LUDHIANA 2. IN THIS APPEAL THE REVENUE HAS RAISED THE FOLLOW ING EFFECTIVE GROUND:- 1. THAT THE LD. CIT(A) ERRED BOTH IN LAW AND ON FACTS WHILE DELETING THE ADDITION OF RS. 94,40,180/- WITHOUT APPRECIATING THE FACTS AND DETAILED REASONS RECORDE D BY THE ASSESSING OFFICER IN THE ASSESSMENT ORDER THAT THE ASSESSEE HAS FILED TO PROVE THE SOURCE OF THESE DEPOSITS. 3. AFTER HEARING BOTH THE PARTIES WE FIND THAT DURI NG ASSESSMENT PROCEEDINGS THE ASSESSING OFFICER NOTICED THAT ASSESSEE HAS DEP OSITED TOTAL SUM OF RS. 94,40,180/- IN CASH IN SAVING BANK ACCOUNT NO. 0533 2010006640. THE DETAILS OF DEPOSITS ARE AS UNDER:- 2 DATE PARTICULARS DEPOSIT CREDIT / WITHDRAWAL 25.08.2009 CASH DEPOSITED 90,180/- 22.12.2009 CASH WITHDRAWAL - 3,00,000/- 26.12.2009 CASH DEPOSITED 3,00,000/- 12.01.2010 CASH WITHDRAWAL - 3,50,000/- 15.01.2010 CASH DEPOSITED 2,00,000/- 18.01.2010 CASH WITHDRAWAL 4,00,000/- 18.01.2010 CASH DEPOSITED 3,00,000/- - 19.01.2010 CASH DEPOSITED 4,40,000/- - 23.01.2010 CASH DEPOSITED 1,10,000/- - 26.02.2010 CASH DEPOSITED 2,00,000/- - 17.03.2010 CASH DEPOSITED 20,00,000/- - 18.03.2010 CASH DEPOSITED 20,00,000/- - 18.03.2010 CASH DEPOSITED 10,00,000/- - 19.03.2010 CASH DEPOSITED 10,00,000/- - 19.03.2010 CASH DEPOSITED 12,00,000/- - 20.03.2010 CASH DEPOSITED 6,00,000/- - TOTAL 94,40,180/- 4. ON FURTHER BEING ASKED TO GIVE THE SOURCE, THE A SSESSEE FILED A CASH FLOW STATEMENT IN WHICH A SUM OF RS. 80 LAKHS WAS SHOWN AVAILABLE WITH THE ASSESSEE AS ON 1.4.2009 ON ACCOUNT OF INCOME SURRENDERED U/S 132(4) OF THE ACT IN ASSESSMENT YEARS 2007-08 AND 2008-09. A COPY OF TH E CASH FLOW STATEMENT HAD BEEN REPRODUCED BY THE ASSESSING OFFICER WHICH IS A S UNDER:- CASH FLOW STATEMENT F.Y. 2008-09 DATE PARTICULARS RECEIPTS PAYMENTS 01.04.2008 OPENING CASH IN HAND ON ACCOUNT OF INCOME SURRENDERED U/S 132(4) FOR THE A.Y. 07-08 & 08-09 8000000.00 - 28.03.2009 BY CASH FROM BANSAL ICE & COLD STORAGE, KHANNA 170000.00 - 28.03.2009 TO CAPITAL FOR MARRIAGE EXP. - 170000.00 8170000.00 170000.00 3 31.03.2009 BY BALANCE - 8000000.00 TOTAL 8170000.00 8170000.00 CASH FLOW STATEMENT F.Y. 2009-10 DATE PARTICULARS RECEIPTS PAYMENTS 01.04.2009 OPENING CASH IN HAND ON ACCOUNT OF INCOME SURRENDERED U/S 132(4) FOR THE A.Y. 07.08 & 08- 09 8000000.00 - 20.08.2009 BY RENT RECEIVED C.EX 90180.00 - 25.08.2009 TO CASH DEPOSITED OBC - 90180.00 22.12.2009 BY CH. 352397 SELF OBC 300000.00 - 28.12.2009 TO CASH DEPOSITED OBC - 300000.00 08.01.2010 BY CH. SELF OBC 300000.00 - 12.01.2010 BY CH. SELF OBC 350000.00 - 15.01.2010 TO CASH DEPOSITED OBC - 200000.00 18.01.2010 BY CH. SELF OBC 400000.00 - 18.01.2010 TO CASH DEPOSITED OBC - 300000.00 19.01.2010 TO CASH DEPOSITED OBC - 440000.00 23.01.2010 TO CASH DEPOSITED OBC - 110000.00 26.02.2010 TO CASH DEPOSITED OBC - 200000.00 17.03.2010 TO CASH DEPOSITED OBC - 2000000.00 18.03.2010 TO CASH DEPOSITED OBC - 2000000.00 18.03.2010 TO CASH DEPOSITED OBC - 1000000.00 19.03.2010 TO CASH DEPOSITED OBC - 1000000.00 19.03.2010 TO CASH DEPOSITED OBC - 1200000.00 20.03.2010 TO CASH DEPOSITED OBC - 600000.00 TOTAL 9440180.00 9440180.00 5. IT WAS FURTHER EXPLAINED THAT CASH WAS DULY REFL ECTED EVEN IN THE WEALTH TAX RETURN AND COPY OF THE WEALTH TAX RETURN WAS AL SO ENCLOSED. THE ASSESSING OFFICER AFTER EXAMINING THESE SUBMISSION OBSERVED THAT THE AMOUNT WHICH WAS AVAILABLE AT THE TIME OF SEARCH WAS RELAT ED TO THE SEARCH CONDUCTED IN APRIL 2007 I.E ABOUT THREE YEARS BACK, AND THEREFOR E, CASH COULD NOT BE STILL AVAILABLE. HE FURTHER OBSERVED THAT IN THE MEANTIM E MARRIAGE OF THE SON OF THE ASSESSEE WAS ALSO SOLEMNIZED AND MAY BE CASH WAS SP ENT IN THAT. FURTHER, A CASH OF RS. 80 LAKHS WAS AVAILABLE THEN WHY CERTAIN AMOU NTS HAVE BEEN WITHDRAWN FROM THE BANK. IN VIEW OF THIS OBSERVATION, A SUM OF RS. 94,40,180/- WAS ADDED TO THE INCOME OF THE ASSESSEE. 4 6. ON APPEAL, IT WAS MAINLY SUBMITTED THAT CASH OF RS. 80 LAKHS WAS AVAILABLE OUT OF THE SURRENDER MADE DURING THE SEAR CH AND CASH WAS DULY REFLECTED IN THE WEALTH TAX RETURN AND, THEREFORE, THERE IS NO JUSTIFICATION IN THE ADDITION. 7. THE LD. CIT(A) FOUND FORCE IN THESE SUBMISSIONS AND DECIDED THE ISSUE IN FAVOUR OF THE ASSESSEE. 8. BEFORE US LD. DR STRONGLY SUPPORTED THE ORDER OF ASSESSING OFFICER AND FURTHER SUBMITTED THAT HOW THE AMOUNT SURRENDERED I N 2007 COULD BE AVAILABLE AND ASSESSEE HAS NOT SHOWN ANY JUSTIFICATION IN KEE PING SUCH A HUGE AMOUNT WITH HIM. 9. ON THE OTHER HAND LD. COUNSEL OF THE ASSESSEE RE FERRED TO THE WEALTH TAX RETURN IN THE PAPER BOOK AND SHOWED THAT AMOUNT OF RS. 80 LAKHS WAS DULY REFLECTED IN THE WEALTH TAX RETURN AND THIS RETURN HAS BEEN ACCEPTED BY THE DEPARTMENT. HE FURTHER FILED COY OF THE RETURN AND ASSESSMENT ORDER FOR ASSESSMENT YEAR 2007-08, THROUGH WHICH INCOME OF RS . 1 CRORE 3 LAKHS WAS SURRENDERED IN THE FORM OF RECEIVABLE. HE SUBMITTE D THAT THIS RETURN HAS ALSO BEEN ACCEPTED BY THE DEPARTMENT. THE AMOUNT SURREN DERED WAS ON ACCOUNT OF RECOVERABLE WHICH HAS BEEN RECEIVED OVER A PERIOD O F TIME WHICH WAS AVAILABLE WITH THE ASSESSEE. IN THIS BACKGROUND HE STRONGLY SUPPORTED THE IMPUGNED ORDER. 10. AFTER CONSIDERING THE RIVAL SUBMISSIONS WE FIND THAT THIS ISSUE HAS BEEN DECIDED BY LD. CIT(A) VIDE PARA 9 WHICH IS UNDER :- 9. I HAVE CONSIDERED THE FACTS OF THE CASE, THE BA SIS OF ADDITION MADE BY THE ASSESSING OFFICER AND THE ARGUMENTS OF THE AR ON THE ISSUE DURING ASSESSMENT AS WELL AS APPELLATE PROCEE DINGS. THE FOLLOWING INCONTROVERTIBLE FACTS REGARDING AVAILABI LITY OF CASH IN 5 HAND WITH THE APPELLANT HAVE BEEN ADMITTED BY THE A SSESSING OFFICER IN THE ASSESSMENT ORDER:- I) THE ASSESSEE HAD ADMITTED INCOME UNDER SECTION 1 32(4)IN THE FORM OF RECEIVABLES TO THE TUNE OF RS. 80,00,000/ - DURING THE COURSE OF SEARCH OPERATION AND HAD PAID THE TAXES O N SUCH INCOME ACCORDINGLY FOR ASSESSMENT YEAR 2007-08 AND 2008-09 . THE SAID DISCLOSURE WAS DULY ACCEPTED BY AND ASSESSED BY THE ASSESSING OFFICER WITHOUT ANY VARIATION THEREOF. II) THE APPELLANT HAD SHOWN THESE RECEIVABLES AS HAVING RECEIVED AS ON 31.03.2008 IN THE FORM OF CASH IN HA ND IN HIS WEALTH TAX RETURN FOR ASSESSMENT YEAR 2008-09. THE SAID AS SESSMENT HAD BEEN FRAMED UNDER SECTION 16(3) AFTER DUE SCRUTINY WITHOUT ANY VARIATION ON THE ISSUE. III) THE WEALTH TAX RETURN FOR ASSESSMENT YEAR 2009 -10 HAD ALSO BEEN FILED BY THE ASSESSEE DISCLOSING THE IMPUGNED CASH IN HAND TO THE TUNE OF RS. 80,00,000/- AS ON 30.03.2009 AND TH E DUE WEALTH TAX ON THE SAME HAD BEEN PAID. THIS RETURN OF WEALTH TA X HAD ALSO BEEN ASSESSED UNDER SECTION 16(1) AND NO ADVERSE COGNIZA NCE THEREOF WAS TAKEN. THE AMOUNTS DEPOSITED IN FINANCIAL YEAR 2009 -10 BY THE APPELLANT HAVE BEEN CLAIMED TO BE FROM THE AVAILABL E CASH IN HAND WHICH HAS BEEN DULY ACCEPTED BY THE DEPARTMENT AS D ETAILED ABOVE BOTH IN THE INCOME TAX AS WELL AS WEALTH TAX RETURN S. IN THE CIRCUMSTANCES, THERE IS NO LOGICAL BASIS FO R THE ASSESSING OFFICER TO REJECT THE CONTENTION OF THE A PPELLANT ON THE ISSUE MERELY ON THE GROUND THAT IT COULD BE IMPROBA BLE FOR THE ASSESSEE TO KEEP CASH TO THE TUNE OF RS. 80,00,000/ - IN CASH FOR TWO YEAR OR SO. THE DISCRETION OF NOT DEPOSITING THE SA ID CASH IN HAND ANYTIME EARLIER THAN THESE HAD BEEN ACTUALLY DEPOSI TED IN BANK WAS WITH THE APPELLANT AND MERE SUSPICION ON THIS ACCOU NT COULD NOT OBLITERATE THE FACT OF ASSESSEE HAVING SUCH CASH IN HAND AS ON 31.03.2009. IN THE CIRCUMSTANCES, THERE IS NO REASO N TO HOLD THAT THE SAID CASH DEPOSITS WERE FROM SOME OTHER ACCOUNTED I NCOME OF THE APPELLANT AND NOT FROM AVAILABLE CASH IN HAND. THE ADDITION MADE IS MERELY ON SUSPICION IGNORING ALL FACTUAL EVIDENCE I N THIS REGARD AND IS THEREFORE DIRECTED TO BE DELETED. 6 11. IN OUR OPINION LD. CIT(A) HAS CORRECTLY DECIDED THE ISSUE BECAUSE ADMITTEDLY THE ASSESSEE HAD DISCLOSED A SUM OF RS. 1.03 CRORES IN ASSESSMENT YEAR 2007-08, AND A SUM OF RS. 10 LAKHS IN ASSESSME NT YEAR 2008-09. THIS AMOUNT WAS SURRENDERED DURING THE SEARCH AND TAX HA VE BEEN DULY PAID AND THE ASSESSED INCOME INCLUDES THIS AMOUNT OF SURRENDER. FURTHER, CASH IS DULY REFLECTED IN THE WEALTH TAX RETURN. ONCE THE FACT OF HAVING CASH DEPOSITED BY THE REVENUE DURING WEALTH TAX ASSESSMENT PROCEEDING S, THEN LATER ON REVENUE CANNOT CHALLENGE THE EXISTENCE OF CASH, THEREFORE, WE FIND NOTHING WRONG WITH THE ORDER OF LD. CIT(A) AND WE CONFIRM THE SAME. 12. IN THE RESULT, APPEAL OF THE REVENUE IS DISMISS ED. ORDER PRONOUNCED IN THE OPEN COURT ON 12.01.2015 SD/- SD/- (BHAVNESH SAINI) (T.R. SOOD) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED : 12 TH JAN 2015 RKK COPY TO: THE APPELLANT, THE RESPONDENT, THE CIT, TH E CIT(A), THE DR