Amruthamma Pulluri, Karimnagar, Hyderabad V. ITO, Ward-3, Karimnagar, Hyderabad

ITA 814/HYD/2016

• Counselvise Citation: [2019] 118 COUNSELVISE.COM (IT) 1269 (ITAT-HYDERABAD)
• Duration Of Justice: 2 year(s) 9 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-03-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB-B
• Next Hearing Date: 07-03-2019
• Assessment Year: 2005-2006
• Appeal Filed On: 31-05-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAJEEV BENJWAL
• Assessee Lawyers: S RAMA RAO
• Keywords: Unexplained investment

Judgement Text

` IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH B ', HYDERABAD BEFORE S HRI V. DURGA RAO , JUDICIAL MEMBER AND SHRI S. RIFAUR RAHMAN , ACCOUNTANT MEMBER ITA NO. 814 / HYD/201 6 ASSESSMENT YEAR: 20 0 5 - 0 6 A MRUTHAMMA PULLURI, KARIMNAGAR, PAN A UCPP1050D VS. INCOME - TAX OFFICER, WARD 3, KARIMNAGAR HYDERABAD. APPELLANT RESPONDENT ASSESSEE BY: S HRI S. RAMA RAO REVENUE BY: SHRI R AJEEV BENJWAL DATE OF HEARING: 07 / 0 3 / 201 9 DATE OF PRONOUNCEMENT: 15 / 0 3 /201 9 O R D E R PER S. RIFAUR RAHMAN , AM: T H IS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF CIT(A) 2 , HYDERABAD, DATED, 3 0 / 1 1 /201 5 FOR AY 20 0 5 - 0 6. 2. ON PERUSAL OF RECORD, WE FIND THAT THERE WAS A DELAY OF 97 DAYS IN FI LING THIS APPEAL BEFORE US. TO THIS EFFECT, THE ASSESSEE HAS FILED A PETITION REQUESTING FOR CONDONATION OF THE SAID DELAY WHEREIN IT WAS STATED THAT SINCE THE ASSESSEE IS A 80 YEARS OLD AND ALMOST CONFINED TO BED DUE TO WHICH SHE WAS NOT IN A POSITION TO GET THE THINGS DONE WITHIN THE STIPULATED TIME, THE DELAY OCCURRED. IT WAS THEREFORE, STATED THAT THE DELAY MAY BE CONDONED AND ADMIT THE APPEAL FOR ADJUDICATION. AN AFFIDAVIT WAS ALSO FILED AFFIRMING THE SAID REASONS. AS THE ASSESSEE WAS PREVENTED BY A R EASONABLE CAUSE FOR NOT FILING THE APPEAL WITHIN THE STIPULATED TIME, WE I.T.A. NO. 814 /HYD/1 6 AMRUTHAMMA PULLURI , KARIMNAGAR 2 CONDONE THE DELAY AND ADMIT THE APPEAL FOR HEARING AND ADJUDICATION. 3. THE BRIEF FACTS RELATING TO THIS APPEAL ARE, THE ASSESSEE MADE TWO CASH DEPOSITS, VIZ., ON 12/02/2005 OF RS. 6,10,000/ - AND ON 26/02/2005 OF RS. 4,00,000/ - . THE AO ACCEPTED THE EXPLANATION OFFERED BY THE ASSESSEE FOR RS. 4,00,000/ - AND PORTION OF RS. 6,10,000/ - . HE MADE DISALLOWANCE OF RS. 1,20,000/ - OUT OF RS. 6,10,000/ - BY OBSERVING AS UNDER: THE EXPLANATION OF THE ASSESSEE IS CAREFULLY CONSIDERED. IT IS TRUE THAT THE ASSESSEE IS IN THE BUSINESS OF MONEY - LENDING AND THEREFORE, THE THEORY OF COLLECTIONS FROM DEBTORS CANNOT BE REJECTED. IT IS ALSO TRUE THAT SHE IS GETTING RENTAL INCOME OF ABOUT R S. 1,20,000/ - PER ANNUM. EVEN ASSUMING THAT THE COLLECTIONS OF RS. 4,25,000/ - AND SALE PROCEEDS OF RS. 65,000 ARE POOLED TOGETHER AND USED IN THE BANK DEPOSIT, IT AMOUNTED TO RS. 4,90,000 ONLY WHEREAS THE DEPOSIT WAS FOR AN AMOUNT OF RS. 6,10,000. THUS, TH ERE IS A GAP OF RS. 1,20,000 BETWEEN THE INVESTMENT AND THE SOURCE, FOR WHICH THERE IS NO PROPER EXPLANATION AND HENCE TREATED AS UNEXPLAINED INVESTMENT IN THE HANDS OF THE ASSESSEE. 4. AGGRIEVED WITH THE ABOVE ORDER, THE ASSESSEE PREFERRED AN APPEAL BE FORE THE CIT(A) AND LD. CIT(A) HAS CONFIRMED THE FINDINGS OF AO. 5. AGGRIEVED BY THE ORDER OF CIT(A), THE ASSESSEE IS IN APPEAL BEFORE US RAISING THE FOLLOWING GROUNDS OF APPEAL: 1) THE ORDER OF THE LEARNED CIT (A) IS ERRONEOUS BOTH ON FACTS AND IN LAW . 2) THE LEARNED CIT (A) ERRED IN CONFIRMING THE ACTION OF THE ASSESSING OFFICER IN TREATING THE DEPOSITS MADE INTO THE BANK ACCOUNT OF RS. 1 ,20, 000/ - AS THE INCOME OF THE APPELLANT. 3) ANY OTHER GROUND OR GROUNDS THAT MAY BE URGED AT THE TIME OF HEARIN G. I.T.A. NO. 814 /HYD/1 6 AMRUTHAMMA PULLURI , KARIMNAGAR 3 6. CONSIDERED THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD. THE EFFECTIVE GROUND RAISED BY THE ASSESSEE IS OBJECTING TO ADDITION OF RS. 1,20,000/ - . WE NOTICE FROM THE ASSESSMENT ORDER THAT AO HAS CONFIRMED THAT THE ASSESSEE HAS RECEIVED RENTAL INCOME TO THE EXTENT OF RS. 1,20,000/ - , WH ILE COMP ARING THE SOURCE FOR DEPOSIT OF RS. 6,10,00 0 / - . HE CONSIDERED THE SOURCES AS I) COLLECTION FROM DEBTORS RS. 4,25,000/ - II) SALE PROCEEDS RS. 65,000/ - RS. 4,90,000/ - ====== ===== THE LD. AR HAS SUBMITTED THAT AFTER CONFIRMING THE RENTAL INCOME, AO HAS NOT GIVEN CREDIT FOR THE SAME. WE NOTICE FROM THE RECORD THAT ASSESSEE HAS DECLARED THE NET INCOME FROM RENT IN THE RETURN OF INCOME AT RS. 84,000/ - AND INCOME FROM LENDING BUSI NESS AT RS. 65, 5 00/ - . THEREFORE, WE CANNOT ACCEPT THE SUBMISSION OF THE LD. AR TO CONSIDER WHOLE OF RENTAL INCOME AS SOURCE FOR MAKING THE ABOVE DEPOSITS . ASSESSEE HAS NET SOURCE OF RS. 1,49,500/ - AND ASSESSEE HAS TO MAINTAIN THE FAMILY, AND AFTER FACTORIN G THE FAMILY MAINTENANCE @ 50%, WE CAN PRESUME THAT ASSESSEE MUST HAVE SAVED SOME FUNDS FOR FUTURE. THEREFORE, WE DIRECT THE AO TO ALLOW RS. 75,000/ - AS SAVINGS FROM THE INCOME OF THIS YEAR. ACCORDINGLY, GROUND RAISED BY THE ASSESSEE IS PARTLY ALLOWED. 7 . IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED. PRONOUNCED IN THE OPEN COURT ON 15 TH MARCH , 201 9. SD/ - ( V. DURGA RAO ) JUDICIAL MEMBER SD/ - ( S. RIFAUR RAHMAN ) ACCOUNTANT MEMBER HYDERABAD, DATED 15 TH MARCH , 201 9. KV I.T.A. NO. 814 /HYD/1 6 AMRUTHAMMA PULLURI , KARIMNAGAR 4 COPY FORWARDED TO: 1. AMRUTHAMMA PULLURI, C/O SRI S. RAMA RAO, ADVOCATE, FLAT NO. 102, SHRIYAS ELEGANCE, 3 - 6 - 643, STREET NO. 9, HIMAYATNAGAR, HYDERABAD 500 029. 2 . IT O , WARD 3 , KARIMNAGAR 3 . CIT (A) - 2 , HYDERABAD 4. PR. CIT 2 , HYDERABAD 5. THE DR, ITAT, HYDERABAD 6. GUARD FILE