Smt Kusum Bhargava L/h of Dr. Prahlad Bhargav, Ujjain V. ITO2 (1) , Ujjain

ITA 82/Ind/2018

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 8022 (ITAT-INDORE)
• Duration Of Justice: 1 year(s) 11 month(s) 6 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-01-2020
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: SMC
• Assessment Year: 2005-2006
• Appeal Filed On: 08-02-2018
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Assessee Lawyers: S S DESHPANDE
• Keywords: Unexplained investment; Onus to prove

Judgement Text

SMC KUSUM BHARGAV ITA 82 OF 2018 1 IN THE INCOME TAX APPELLATE TRIBUNAL INDORE SMC BENCH, INDORE BEFORE SHRI KUL BHARAT, JUDICIAL MEMBER ITA NO. 82/IND/2018 A.Y. 2005-06 SMT. KUSUM BHARGAV L/H OF DR. PRAHLAD BHARGAV, UJJAIN PAN ACIPB 3688 B :: APPELLANT VS ITO-2(1), UJJAIN :: RESPONDENT ASSESSEE BY SHRI S.S. DESHPANDE, CA RESPONDENT BY SHRI ASHISH PORWAL, SR. DR DATE OF HEARING 08.1.2020 DATE OF PRONOUNCEMENT 14.1.2020 O R D E R THIS APPEAL IS FILED BY THE ASSESSEE AGAINST THE O RDER OF LD. CIT(A)-UJJAIN DATED 01.11.2017. 2. FACTS GIVING RISE TO THE GROUNDS OF APPEAL ARE T HAT THE ASSESSEE IS AN INDIVIDUAL DERIVING INCOME FROM SERV ICE AND SHARE SMC KUSUM BHARGAV ITA 82 OF 2018 2 TRADING. THE RETURN OF INCOME DECLARING TOTAL INCOM E OF RS.2,81,610/- WAS FILED ON 28.7.2005. THE REVISED R ETURN OF INCOME WAS FILED ON 08.8.2005 DECLARING FURTHER INC OME OF RS.4,826/-. THE ASSESSING OFFICER FRAMED ASSESSMENT AND MADE ADDITIONS AND THE LD. CIT(A) ALSO PARTLY CONFIRMED THE ADDITIONS, AGAINST WHICH THE ASSESSEE IS BEFORE THIS TRIBUNAL. 3. THROUGH FIRST GROUND, THE ASSESSEE HAS CHALLENGE D THE CONFIRMATION OF THE ADDITION OF RS.1,11,203/- ON AC COUNT OF CREDITS IN BANK ACCOUNT. THE ASSESSING OFFICER MADE ADDITIO NS HOLDING THAT THE ASSESSEE FAILED TO DISCHARGE THE BURDEN OF PROOF BY NOT ESTABLISHING THE GENUINENESS OF CREDITS IN THE BANK ACCOUNT. HOWEVER, LD. CIT(A) DELETED THE ADDITION OF RS.50,0 00/- CONSIDERING THE PAST SAVINGS. THEREFORE, REMAINING ADDITION OF RS.1,11,203/- HAS BEEN CHALLENGED BY THE ASSESSEE B EFORE THIS TRIBUNAL. 4. BEFORE ME, LEARNED COUNSEL FOR THE ASSESSEE SUBM ITTED THAT THE ASSESSEE HAS BEEN RECEIVING SALARY AND INTEREST INCOME AS HE SMC KUSUM BHARGAV ITA 82 OF 2018 3 WAS WORKING IN THE GOVERNMENT HEALTH DEPARTMENT SIN CE 02.9.1997 AS AN ASSISTANT SURGEON. THEREFORE, THE C REDITS ARE FROM THE ROTATIONAL FUND. FURTHER, THE ASSESSEE WAS DOING SHARE TRADING AND DUE TO CANCELLATION OF DD PURCHASED FOR SHARE TRADING, THE CREDIT OF RS.37,734/- IS APPEARING IN THE BANK ACCOUNT. CREDIT ENTRY OF RS.74,000/- IS TOWARDS CLEARING OF CHEQUE NO.143176. CREDIT ENTRY OF RS.27,200/- IS TOWARDS IDBI INFRAST RUCTURE BONDS PURCHASED BY THE ASSESSEE IN EARLIER YEARS. THEREFO RE, THE ASSESSEE HAD DULY DISCHARGED THE BURDEN OF PROOF BY EXPLAINING THE CREDIT ENTRIES. BUT, THE ASSESSING OFFICER DID NOT CONSIDER THE SAME AND LD. CIT(A) ONLY GRANTED PART RELIEF ON ACC OUNT OF PAST SAVINGS, WHICH IS NOT JUSTIFIED. THE ADDITION SHOUL D HAVE NOT BEEN MADE. ON THE OTHER HAND, LD. SR. DR RELIED ON THE ORDERS OF THE REVENUE AUTHORITIES BUT COULD NOT CONTROVERT THE SU BMISSION OF THE ASSESSEE BY BRINGING ANY CONTRARY MATERIAL ON R ECORD. 5. I HAVE CONSIDERED THE RIVAL SUBMISSIONS OF BOTH THE PARTIES AND GONE THROUGH THE MATERIAL AVAILABLE ON THE FILE . ON SMC KUSUM BHARGAV ITA 82 OF 2018 4 CONSIDERATION OF ABOVE FACTS, I FIND THAT LD. CIT(A ) CONSIDERED THE PAST SAVINGS BUT DID NOT APPRECIATE THE EXPLANATION OF THE ASSESSEE THAT HE WAS WORKING IN THE GOVERNMENT HEAL TH DEPARTMENT SINCE 02.9.1997 AS AN ASSISTANT SURGEON AND THE CREDITS ARE FROM THE ROTATIONAL FUND. FURTHER, CRED IT ENTRIES REGARDING THE CANCELLATION OF DD PURCHASED FOR SHAR E TRADING, CLEARING OF CHEQUE NO.143176 AND IDBI INFRASTRUCTUR E BONDS PURCHASED BY THE ASSESSEE IN EARLIER YEARS HAVE NOT BEEN CONSIDERED BY THE LD. CIT(A), WHICH IS NOT JUSTIFIE D BECAUSE THE ASSESSEE HAS EXPLAINED THE NATURE OF CREDIT ENTRIES . THEREFORE, I DIRECT THE ASSESSING OFFICER TO DELETE THE ADDITION ON ACCOUNT OF CASH CREDITS IN BANK ACCOUNT. ACCORDINGLY, GROUND N O.1 RAISED BY THE ASSESSEE IS ALLOWED. 6. SO FAR AS GROUND NO.2 WITH REGARD TO ADDITION OF RS.1,97,545/- ON ACCOUNT OF INTEREST ON FDR IS CONC ERNED, THE ASSESSING OFFICER NOTED THAT THE ENTRIES OF RS.2,12 ,600/-, 82,432/- , 83,209/- 1,26,316/-, 1,25,387/-, 1,26,051/- MADE ON 01.9.04, SMC KUSUM BHARGAV ITA 82 OF 2018 5 27.11.04, 27.11.04, 28.1.05, 28.1.05, 03.2.05 RELAT E TO MATURITY VALUE OF FDRS MADE IN EARLIER YEAR AND THE INTEREST EARNED ON THESE FDRS COMES TO RS.1,97,545/-. THE ASSESSING OF FICER, THEREFORE, ADDED RS.1,97,545/- TO THE TOTAL INCOME OF THE ASSESSEE. THE LD. CIT(A) ALSO CONFIRMED THE ACTION OF THE ASSESSING OFFICER. 7. BEFORE ME, LEARNED COUNSEL FOR THE ASSESSEE SUBM ITTED THAT MAJOR PART OF INTEREST INCOME RELATES TO PREVIOUS Y EARS, THEREFORE, IN THE YEAR UNDER CONSIDERATION, THE SAME CANNOT BE ADDED. ON THE OTHER HAND, LD. SR. DR RELIED ON THE ORDERS OF THE AUTHORITIES BELOW. 8. ON CONSIDERATION OF ABOVE FACTS, I FIND THAT THE ASSESSING OFFICER HIMSELF NOTED IN THE ASSESSMENT ORDER THAT FDRS RELATE TO EARLIER YEARS, THEREFORE, I FIND FORCE IN THE CONTE NTION OF THE ASSESSEE THAT THE MAJOR PART OF INTEREST EARNED ON MATURITY VALUE OF FDRS PERTAINS TO PREVIOUS YEARS, WHICH SHOULD NO T BE ADDED IN THE PRESENT YEAR. LOOKING TO THESE FACTS, I DIRECT THE ASSESSING SMC KUSUM BHARGAV ITA 82 OF 2018 6 OFFICER TO DELETE THE ADDITION IN RESPECT OF INTERE ST EARNED ON PREVIOUS YEARS AND RESTRICT THE ADDITION TO THE YEA R UNDER CONSIDERATION IF THE SAME IS NOT PART OF RETURN OF INCOME FOR THE PRESENT YEAR. ACCORDINGLY, GROUND NO.2 RAISED BY TH E ASSESSEE IS PARTLY ALLOWED. 9. THROUGH THE GROUND NO.3, THE ASSESSEE HAS CHALLE NGED THE CONFIRMATION OF ADDITION OF RS.50,000/- ON ACCOUNT OF PRIVATE PRACTICE. THE ASSESSING OFFICER MADE ADDITION NOTIN G THAT THE ASSESSEE COULD NOT PROVE THE CREDIT ENTRY OF RS.50, 000/- MADE IN THE BANK ACCOUNT. THE LD. CIT(A) CONFIRMED THE SAME ON THE GROUND THAT THE ASSESSEE IS A SURGEON AND RECEIVING FEES FROM PRIVATE PRACTICE. 10. LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT ON PRESUMPTION, THIS ADDITION HAS BEEN SUSTAINED BY TH E LD. CIT(A) AS NO EVIDENCE HAS BEEN BROUGHT ON RECORD REGARDING PR IVATE PRACTICE DONE BY ASSESSEE. ON THE OTHER HAND, LD. S R. DR RELIED ON THE ORDERS OF THE AUTHORITIES BELOW. SMC KUSUM BHARGAV ITA 82 OF 2018 7 11. ON CONSIDERATION OF ABOVE FACTS, I FIND THAT LD . CIT(A) NOTED IN THE ORDER THAT THE ASSESSEE IS A SURGEON AND REC EIVING FEES FROM PRIVATE PRACTICE. HOWEVER, PERUSAL OF ASSESSME NT ORDER AND IMPUGNED ORDERS SHOWS THAT NO CORROBORATIVE EVIDENC E WAS BROUGHT ON RECORD BY THE REVENUE AUTHORITIES IN THI S REGARD. THEREFORE, THE LD. CIT(A) ON PRESUMPTIVE BASIS SUST AINED THE ADDITION, WHICH IS NOT JUSTIFIED. THUS, I DIRECT TH E ASSESSING OFFICER TO DELETE THE ADDITION OF RS.50,000/-. 12. THE LAST GROUND RAISED BY THE ASSESSEE IS WITH REGARD TO CONFIRMATION OF ADDITION OF RS.7,68,844/- ON ACCOUN T OF UNEXPLAINED INVESTMENT IN SHARES AND MUTUAL FUND. F ACTS GIVING RISE TO GROUND OF APPEAL ARE THAT THE ASSESSING OFF ICER NOTED THAT THE ASSESSEE HAS INVESTED IN THE SHARES AND AS PER BALANCE SHEET ENCLOSED WITH RETURN OF INCOME OF WIFE OF THE ASSESSEE, THE VALUE OF STOCK OF SHARES HAS BEEN SHOWN AT RS.6,18, 844/- INCLUDING INVESTMENT IN MUTUAL FUND AND ALSO INVEST MENT OF RS.1,50,000/- IN TAX FREE BONDS. THE ASSESSING OFFI CER WAS OF THE SMC KUSUM BHARGAV ITA 82 OF 2018 8 VIEW THAT THESE INVESTMENTS TOTALING TO RS.7,68,844 /- RELATED TO ASSESSEE. THE LD. CIT(A) CONFIRMED THE SAME ON THE GROUND THAT THE INITIAL BURDEN WAS NOT DISCHARGED BY THE ASSESS EE ESTABLISHING THE GENUINENESS OF TRANSACTION. 13. BEFORE ME, LEARNED COUNSEL FOR THE ASSESSEE SUB MITTED THAT THE AMOUNT WAS SHOWN IN THE RETURN OF INCOME OF THE WIFE OF THE ASSESSEE AND AS SUCH THE ADDITION IN THE HANDS OF T HE ASSESSEE IS UNJUSTIFIED. THEREFORE, IT IS SUFFICIENT PROOF O F DISCHARGING THE INITIAL BURDEN OF EXPLAINING THE ADDITION. BUT, THE ASSESSING OFFICER DID NOT CONSIDER THE SAME AND LD. CIT(A) HOWEVER DE LETED THE ADDITION OF RS.1,37,528/- ON ACCOUNT OF PROFIT ON S HARE TRADING HOLDING THAT THE SAME PERTAINS TO WIFE OF THE ASSES SEE BUT INVESTMENT OF RS.7,68,844/- WAS NOT DELETED ON THE GROUND THAT THE INITIAL BURDEN WAS NOT DISCHARGED BY THE ASSESS EE ESTABLISHING THE GENUINENESS OF TRANSACTION, WHICH IS NOT JUSTIFIED. ON THE OTHER HAND, LD. SR. DR RELIED ON THE ORDERS OF THE REVENUE SMC KUSUM BHARGAV ITA 82 OF 2018 9 AUTHORITIES BUT COULD NOT CONTROVERT THE SUBMISSION OF THE ASSESSEE BY BRINGING ANY CONTRARY MATERIAL ON RECOR D. 14. I HAVE CONSIDERED THE RIVAL SUBMISSIONS OF BOTH THE PARTIES AND GONE THROUGH THE MATERIAL AVAILABLE ON THE FILE . ON CONSIDERATION OF ABOVE FACTS, I FIND THAT IN PARA 5 .6, THE LD. CIT(A) HELD THAT THE ASSESSING OFFICER WAS NOT JUSTIFIED I N MAKING THE ADDITION OF THE INCOME OF RS.1,37,528 ON ACCOUNT OF PROFIT ON SHARE TRADING PERTAINING TO WIFE OF THE ASSESSEE. H OWEVER, INVESTMENT OF RS.7,68,844 WAS NOT DELETED ON THE GR OUND THAT THE INITIAL BURDEN WAS NOT DISCHARGED BY THE ASSESSEE. I FIND THAT LD. CIT(A) HIMSELF HAS CONSIDERED THE FACT THAT THE WIF E OF THE ASSESSEE HAS PROFIT ON SHARE TRADING AND ACCORDINGL Y DELETED THE ADDITION, THEREFORE, THE INITIAL BURDEN HAD BEEN DI SCHARGED BY THE ASSESSEE. THUS, THE LD. CIT(A) SHOULD ALSO HAVE DEL ETED THE ADDITION ON ACCOUNT OF INVESTMENT OF RS.7,68,844. T HEREFORE, I DIRECT THE ASSESSING OFFICER TO DELETE THE ADDITION OF RS.7,68,844. SMC KUSUM BHARGAV ITA 82 OF 2018 10 ACCORDINGLY, GROUND NO.4 RAISED IN THE ASSESSEES A PPEAL IS ALLOWED. 15. IN RESULT, THE APPEAL OF THE ASSESSEE IS PARTLY ALLOWED. ORDER WAS PRONOUNCED IN THE OPEN COURT ON 14.1.2020 . SD/- (KUL BHARAT) JUDICIAL MEMBER DATED : 14.1.2020 ! VYAS ! COPY TO: APPELLANT/RESPONDENT/PR.CIT(A)/PR.CIT/DR, INDORE