Sri Polleyalli Ram Mohan , Bangalore V. Income TAx Officer Ward-7(2)(5), BAngalore

ITA 802/BANG/2018

• Counselvise Citation: [2020] 110 COUNSELVISE.COM (IT) 5427 (ITAT-BANGALORE)
• Duration Of Justice: 2 year(s) 6 month(s) 20 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-10-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Assessment Year: 2014-2015
• Appeal Filed On: 15-03-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: R PREMI JT BENGALU RU
• Assessee Lawyers: L MAHESH KUMAR
• Keywords: Peak credit; Source of fund
• Section: 143(3); 133(6)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH : BANGALORE BEFORE SHRI N.V. VASUDEVAN, VICE PRESIDENT AND SHRI B R BASKARAN, ACCOUNTANT MEMBER ITA NO.802/BANG/2018 ASSESSMENT YEAR : 2014 - 15 SRI POLLEPALLI RAM MOHAN, NO.17, 3 RD CROSS, VIDYAPEETA MAIN ROAD, BALAJI LAYOUT, BANGALORE 560 085. PAN: AEVPR 3604L VS. THE INCOME TAX OFFICER, WARD 7(2)(5), BANGALORE. APPELLANT RESPONDENT APPELLANT BY : SHRI L. MAHESH KUMAR, CA RESPONDENT BY : SMT. R. PREMI, JT. CIT(DR)(ITAT), BENGALURU. DATE OF HEARING : 29.09.2020 DATE OF PRONOUNCEMENT : 05.10.2020 O R D E R PER N.V. VASUDEVAN, VICE PRESIDENT THIS APPEAL BY THE ASSESSEE IS AGAINST THE ORDER D ATED 4.1.2018 OF THE CIT(APPEALS)-7, BENGALURU RELATING TO ASSESSMEN T YEAR 2014-15. 2. THE ASSESSEE IS AN INDIVIDUAL WHO FILED RETURN OF INCOME FOR THE AY 2014-15 DECLARING A TOTAL INCOME OF RS.5,66,420. I N THE COURSE OF ASSESSMENT PROCEEDINGS U/S. 143(3) OF THE INCOME-TA X ACT, 1961 [THE ACT], THE AO OBTAINED INFORMATION U/S. 133(6) OF THE ACT FROM SHRI SUBRAMANYESHWARA CO-OPERATIVE BANK LTD., WHICH REVE ALED THAT THE ASSESSEE HAD DEPOSITED A SUM OF RS.52,40,000 IN HIS SB ACCOUNT. SINCE NO EXPENDITURE WITH REGARD TO THE SOURCE WAS FURNIS HED BY THE ASSESSEE, THE AO ADDED THE AFORESAID SUM TO THE TOTAL INCOME OF THE ASSESSEE AS ITA NO.802/BANG/2018 PAGE 2 OF 4 INCOME UNDER THE HEAD INCOME FROM OTHER SOURCES. AGAINST THE AFORESAID ADDITION, THE ASSESSEE PREFERRED APPEAL BEFORE THE CIT(APPEALS). 3. BEFORE THE CIT(APPEALS), THE HEARING OF THE APPE AL WAS FIXED ON 7.2.12017. ON THAT DATE, THE LD. AR OF ASSESSEE PR AYED FOR ONE MORE OPPORTUNITY BEFORE THE AO TO EXPLAIN HIS CASE. THE CIT(APPEALS) HELD THAT SINCE THE WRITTEN SUBMISSIONS NOR ANY SUPPORTING EV IDENCE WAS FILED, IT WAS NOT POSSIBLE FOR HIM TO REMAND THE MATTER TO THE AO . THE CIT(A) FOUND THAT THERE WAS NO EXPLANATION BY THE ASSESSEE AND THEREF ORE THE ADDITION MADE BY THE AO WAS SUSTAINED BY THE CIT(APPEALS). 4. AGGRIEVED BY THE ORDER OF CIT(APPEALS), THE ASSE SSEE HAS PREFERRED THE PRESENT APPEAL BEFORE THE TRIBUNAL. 5. THE ASSESSEE HAS FILED A COPY OF THE ORDER OF CI T(APPEALS) WHICH IS NOT COMPLETE. THE ASSESSEE HAS, HOWEVER, FILED AN AFFIDAVIT BEFORE US ALONG WITH A COMPLETE COPY OF THE ORDER OF CIT(APPE ALS), AGAINST WHICH THE PRESENT APPEAL HAS BEEN FILED. THE COMPLETE COPY O F THE ORDER OF CIT(APPEALS) IS TAKEN ON RECORD. 6. THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE ASSESSEE WAS CARRYING ON BUSINESS OF WOOD CONSULTING AND TRAININ G. THE FACTORY OF THE FIRM, IN WHICH THE ASSESSEE WAS A PARTNER, WAS GUTT ED BY FIRE ON 11.6.2011 AND THEREFORE THE FIRM FACE INTENSE FINANCIAL CRUNC H. HE ALSO SUBMITTED THAT THE BANK ACCOUNT IN QUESTION WAS A JOINT ACCOUNT AN D THEREFORE THE ADDITION MADE OF THE ENTIRE DEPOSITS IN THE ACCOUNT CANNOT B E SUSTAINED. COPY OF THE LETTER OF THE BANK CERTIFYING THAT THE SB A/C N O.12008 IS A JOINT ACCOUNT IN THE NAME OF THE ASSESSEE AND HIS WIFE HA S BEEN FILED BEFORE US. IT WAS ALSO SUBMITTED THAT THERE WERE CASH WITHDRAW ALS FROM THE BANK ACCOUNT AND THIS ASPECT HAS BEEN OMITTED. IT WAS A LSO SUBMITTED THAT THE LOANS OBTAINED FOR THE PURPOSE OF BUSINESS HAD BEEN THE SOURCE OF DEPOSIT ITA NO.802/BANG/2018 PAGE 3 OF 4 INTO THE BANK ACCOUNT. IT WAS ALSO SUBMITTED THAT THE PEAK CREDIT IF WORKED OUT WILL BE NEGATIVE AND NO ADDITION CAN BE MADE. HE SUBMITTED THAT BECAUSE OF THE FIRE IN THE FACTORY AND BECAUSE OF L ITIGATION CONNECTED WITH THE FACTORY AND ILLNESS OF FAMILY MEMBERS, THE ASSE SSEE COULD NOT REPRESENT PROPERLY BEFORE THE LOWER AUTHORITIES. THE LD. COU NSEL FOR THE ASSESSEE ACCORDINGLY PRAYED THAT THE ASSESSEE MAY BE GIVEN A N OPPORTUNITY TO SUBSTANTIATE THE SOURCE OF FUNDS AND CASH DEPOSIT I N THE BANK ACCOUNT WHICH WAS ADDED AS UNEXPLAINED INCOME BY THE AO AND CONFIRMED BY THE CIT(APPEALS). 7. AFTER CONSIDERING THE RIVAL SUBMISSIONS, WE ARE OF THE VIEW THAT THE EVENTS AT THE TIME OF ASSESSMENT PROCEEDINGS AS WEL L AS APPELLATE PROCEEDINGS, THE ASSESSEE WAS PREVENTED BY REASONAB LE CAUSE FROM PRODUCING THE REQUIRED EVIDENCE. CONSIDERING THE F ACTS AND CIRCUMSTANCES 8. OF THE CASE, WE ARE OF THE VIEW THAT ASSESSEE D ESERVES ONE MORE OPPORTUNITY BEFORE THE AO. ACCORDINGLY, WE SET ASI DE THE ORDER OF CIT(APPEALS) AND REMAND THE ISSUE WITH REGARD TO TH E IMPUGNED ADDITION FOR DE NOVO CONSIDERATION, AFTER AFFORDING ASSESSEE OPPORTUNIT Y OF BEING HEARD. THE ASSESSEE WILL COOPERATE AND FURNISH THE REQUIRED DETAILS BEFORE THE AO WITH DEFAULT. 9. IN THE RESULT, THE APPEAL BY THE ASSESSEE IS ALL OWED FOR STATISTICAL PURPOSES. PRONOUNCED IN THE OPEN COURT ON THIS 5 TH DAY OF OCTOBER, 2020. SD/- SD/- ( B R BASKARAN ) ( N V VASUDEVAN ) ACCOUNTANT MEMBER VICE PRE SIDENT BANGALORE, DATED, THE 5 TH OCTOBER, 2020. / DESAI S MURTHY / ITA NO.802/BANG/2018 PAGE 4 OF 4 COPY TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR, ITAT, BANGALORE. BY ORDER ASSISTANT REGISTRAR ITAT, BANGALORE.