ITO, Bangalore V. Sri Pagariya Nandkishore Suwalalji, Bangalore

ITA 785/BANG/2009

• Counselvise Citation: [2009] 115 COUNSELVISE.COM (IT) 2053 (ITAT-BANGALORE)
• Duration Of Justice: 4 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-12-2009
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 14-12-2009
• Assessment Year: 2006-2007
• Appeal Filed On: 05-08-2009
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: V S SREELEKHA
• Assessee Lawyers: H GANPATLAL KAWAD
• Keywords: Unexplained cash credit; Reasonable cause

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL BANGALORE B BENCH, BANGALORE BEFORE SHRI SHAILENDRA KUMAR YADAV, JM AND SHRI A. MOHAN ALANKAMONY, AM ITA NO.785(BNG.)/2009 (ASSESSMENT YEAR : 2006-07) THE INCOME-TAX OFFICER, WARD-14(1), H.M.T BHAVAN, GANGA NAGAR, BANGALORE-560 032. APPELLANT VS SRI PAGARIYA NANDKISHORE SUWALALJI, SWAROOPA RANI, 608, F, BLOCK, RAHEJA PARK, MAGADI MAIN ROAD, BANGALORE-560 079 RESPO NDENT REVENUE BY : SMT. V.S.SREELEKHA ASSESSEE BY : SHRI H. GANPATLAL KAWAD O R D E R PER SHRI SHAILENDRA KUMAR YADAV, JM THIS APPEAL HAS BEEN FILED BY THE REVENUE AGAINST THE ORDER OF CIT(A), BANGALORE DATED 26-05-2009 AGAINST DELETION OF ADDITION MADE ON ACCOUNT OF DEPOSITS OF RS.3,65,000/- IN SBM AND RS.25,47,000/- IN AXIS BANK. 2. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESS EE HAD PURCHASED MUTUAL FUND FOR RS.41,00,000/- DURING THE ITA NO.785(B)/09 2 ASSESSMENT YEAR 2006-07. THE AO FOUND THAT THE ASS ESSEE HAD MADE CASH DEPOSITS AMOUNTING TO RS.3,65,000/- IN SB M AND RS.25,47,000/- IN AXIS BANK ON VARIOUS DATES. THE ASSESSEE HAS STATED THAT THESE DEPOSITS WERE MADE BY SALE OF AGR ICULTURAL PRODUCTS THROUGH RELATIVES. IN ABSENCE OF MATERIAL S AND SINCE THE CASE WERE GETTING TIME BARRED, THE ASSESSMENT WAS C OMPLETED ADDING THE UNEXPLAINED CASH CREDITS OF RS.3,65,000 /- AND RS.25,47,000/- DEPOSITED IN SBM AND AXIS BANK RESPE CTIVELY AND INTEREST THEREON RS.37,913/-. 3. THE MATTER WAS CARRIED BEFORE THE FIRST APPELLAT E AUTHORITY, WHO AFTER CALLING FOR REMAND REPORT GRANTED RELIEF TO THE ASSESSEE. THE SAME HAS BEEN OPPOSED BEFORE US BY THE REVENUE. ON THE OTHER HAND, LEARNED AR SUPPORTED THE ORDER OF THE C IT(A)STATING THAT THE ADDITION IN QUESTION HAS BEEN RIGHTLY DELE TED BY THE CIT(A), WHO AFTER TAKING INTO CONSIDERATION THE REM AND REPORT CALLED FROM THE CONCERNED AO. 4. AFTER GOING THROUGH THE RIVAL SUBMISSION AND MA TERIAL ON RECORD, WE ARE NOT INCLINED TO INTERFERE WITH THE F INDINGS OF THE CIT(A). THE AO NOTICED THAT THE CASH DEPOSITS OF R S.3,65,000/- IN SBM AND RS.25,47,000/- IN AXIS BANK. THOUGH, AT TH E TIME OF ITA NO.785(B)/09 3 ASSESSMENT PROCEEDINGS, INCOME FROM AGRICULTURAL AC TIVITY COULD NOT BE SUBSTANTIATED, SO THE AO HELD THAT THE SAME WERE UNEXPLAINED CREDIT WITH THE ASSESSEE. IN APPEAL TH E CIT(A) CALLED FOR REMAND REPORT AND WENT THROUGH THE DETAILS OF A GRICULTURAL LAND AND LETTER FROM COUSIN BROTHER OF ASSESSEE WIT H REGARD TO AGRICULTURAL INCOME WHICH COULD NOT BE FILED BEFORE THE AO. IN FACT THE AO HAD HURRIEDLY PASSED ASSESSMENT ORDER, STATI NG THEREIN THAT IT WAS GETTING TIME BARRED. SO IT WAS VALID ON THE PART OF THE CIT(A) TO ADMIT THE AFORESAID EVIDENCE FOR WHICH AS SESSEE WAS PREVENTED BY REASONABLE CAUSE BEFORE THE CONCERNED AO. IT IS NOT IN DISPUTE THAT THE ASSESSEE IS HAVING AGRICULTURAL HOLDING OF 18 ACRES OF LAND SINCE 1991 AND THE SAME HAS BEEN CULT IVATED BY HIS RELATIVE CULTIVATORS WHO HAS CATEGORICALLY STATED THAT AFTER ADJUSTMENT OF ALL EXPENSES TOWARDS CULTIVATION THE ASSESSEE SHRI NANDKISHORE SUWALAJI PAGARIYA HAS BEEN GIVEN RS.2.5 TO 3 LAKHS CASH EVERY YEAR. THUS, THE ASSESSEE HAS DEPOSITED RS.25,47,000/- IN AXIS BANK AND RS.3,65,000/- IN SBM RESPECTIVELY OUT OF ABOVE SAID ACCUMULATION OF AGRICULTURAL INCOME. FURTHER, ON PERUSAL OF THE BANK STATEMENT OF AXIS BANK, IT WAS FOUND THAT THE ASSESSEE DEPOSITED CASH OF RS.25,47,000/- IN AXIS BANK ON VA RIOUS DATES. ITA NO.785(B)/09 4 SIMILARLY, WITH REGARDS TO BANK STATEMENT IT WAS FO UND THAT THE ASSESSEE DID NOT OPEN BANK ACCOUNT TILL 1996-97 AND THE CASH BALANCE FROM AGRICULTURAL PRODUCE CARRIED FORWARD F ROM FY:1997- 98 WAS RS.20,30,000/-AND IT WAS SUBSTANTIATED FROM THE CASH FLOW STATEMENT THAT THE ASSESSEE HAD CASH IN HAND AND DE POSITED THE SAME IN ABOVE MENTIONED BANK. THE MUTUAL FUND INVES TMENTS HAVE BEEN DRAWN FROM SAID BANK ACCOUNTS WHICH WAS N OT DISPUTED BY THE AO. THUS, THE MAIN SOURCE OF MUTUAL FUND IN VESTMENT STOOD EXPLAINED AS MENTIONED ABOVE. SO, THE AO WAS NOT JUSTIFIED TO DISBELIEVE THE SAME. IN VIEW OF THE ABOVE, AO W AS RIGHTLY DIRECTED TO DELETE THE SAME BY THE CIT(A) AFTER CAL LING FOR REMAND REPORT ON THE ISSUE. WE UPHOLD THE SAME. 5. IN THE RESULT, THE APPEAL FILED BY THE REVENUE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 30-12-2009. ( A. MOHAN ALANKAMONY) (SHAILENDRA KUMAR YADAV) AC COUNTANT MEMBER JUDICIAL ME MBER PLACE: BANGALORE DATED: 30-12-2009. AM * COPY TO : 1. THE ASSESSEE 2. THE REVENUE 3. CIT(A) 4. CIT ITA NO.785(B)/09 5 5. DR 6. GF(BLORE) 7. GF(DELHI AR, ITAT, BANGALORE