ANOOP P. BABANI, MUMBAI V. ASST CIT CIR 1, THANE

ITA 854/MUM/2016

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 3740 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 5 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-08-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2009-2010
• Appeal Filed On: 22-02-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SUMAN KUMAR
• Assessee Lawyers: SURESH N OTWANI
• Keywords: Unexplained cash credit
• Section: 69C; 68; 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCH B, MUMBAI BEFORE SHRI JOGINDER SINGH, JUDICIAL MEMBER AND SHRI RAJESH KUMAR, ACCOUNTANT MEMBER ITA NO.854/M/2016 ASSESSMENT YEAR: 2009-10 SHRI ANOOP P. BABANI, C/O. SHRI SURESH N. OTWANI, ADVOCATE 305, 3 RD FLOOR, ADAMJI BUILDING, 413, KATHA BAZAR, MUMBAI 400 009 PAN: AFLPB 1551R VS. ASST. COMM. OF INCOME TAX, CIR-1 THANE, ROOM NO.29, A-WING, 6 TH FLOOR, ASHAR IT PARK, ROAD NO.16-Z, WAGLE INDL. ESTATE, THANE 400 604 (APPELLANT) (RE SPONDENT) PRESENT FOR: ASSESSEE BY : SHRI SURESH N. OTWANI, A.R. REVENUE BY : SHRI SUMAN KUMAR, D.R. DATE OF HEARING : 26.07.2018 DATE OF PRONOUNCEMENT : 10.08.2018 O R D E R PER RAJESH KUMAR, ACCOUNTANT MEMBER: THE PRESENT APPEAL HAS BEEN PREFERRED BY THE ASSES SEE AGAINST THE ORDER DATED 22.12.2015 OF THE COMMISSIONE R OF INCOME TAX (APPEALS) [HEREINAFTER REFERRED TO AS TH E CIT(A)] RELEVANT TO ASSESSMENT YEAR 2009-10. 2. THE ONLY ISSUE RAISED BY THE ASSESSEE IS AGAINST THE CONFIRMATION OF PENALTY BY LD. CIT(A) OF RS.1,01,970 /- AS IMPOSED BY THE AO UNDER SECTION 271(1)(C) OF THE AC T. 3. THE FACTS IN BRIEF ARE THAT THE ASSESSEE IS A SA LARIED EMPLOYEE AND FILED RETURN OF INCOME ON 17.11.2009 D ECLARING ITA NO.854/M/2016 SHRI ANOOP P. BABANI 2 AN INCOME OF RS.17,84,110/-. THE CASE OF THE ASSESSEE WAS SELECTED FOR SCRUTINY. THE AO OBSERVED DURING THE COURSE OF ASSESSMENT PROCEEDINGS THAT ASSESSEE HAS RECEIVED S ALARY FROM THREE EMPLOYERS AND ALSO SHARE OF PROFIT FROM FOUR FIRMS. ACCORDING TO THE AO, THE ASSESSEE COULD NOT EXPLAIN THE DEPOSIT OF RS.3 LAKHS OUT OF RS.11,32,085/-. THEREAF TER, THE ASSESSMENT WAS FRAMED EX-PARTE UNDER SECTION 144 OF THE ACT VIDE ORDER DATED 23.11.2011 WHEREIN ADDITIONS TOWAR DS UNEXPLAINED RECEIPTS RS.45,000/-, UNEXPLAINED CASH CR EDITS RS.11,32,085/- UNDER SECTION 68 AND SELF ASSESSMEN T TAX PAYMENT UNDER SECTION 69C OF RS.41,945/- WERE MADE. 4. IN THE APPELLATE PROCEEDINGS, OUT OF VARIOUS AD DITIONS AS MADE BY THE AO, ONLY RS.3 LAKHS WAS CONFIRMED BY WAY OF ESTIMATION OF PERSONAL PURPOSES TOWARDS THE HOUSEHO LD EXPENSES ON WHICH A PENALTY OF RS.1,01,970/- WAS IMP OSED EQUAL TO 100% OF THE TAX SOUGHT TO BE EVADED. IN T HE APPELLATE PROCEEDINGS, THE LD. CIT(A) CONFIRMED THE PENALTY BY HOLDING THAT THE ASSESSEE WAS NOT ABLE TO EXPLAI N THE SOURCE OF RS.3 LAKHS AND THUS JUSTIFIES THE IMPOSITI ON OF PENALTY. 5. THE LD. A.R. VEHEMENTLY SUBMITTED BEFORE US THAT THE LD. CIT(A) PASSED THE ORDER BY IGNORING THE REMAND REPO RT FILED BY THE AO TO LD. CIT(A) IN WHICH THE AO HAS GIVEN A CLEAR CUT FINDING THAT AVAILABILITY OF CASH HAS BEEN VERIFIED AND FOUND TO BE IN ORDER FROM THE BOOKS OF ACCOUNTS OF THE ASSES SEE. THE LD. A.R. ALSO SUBMITTED THAT THE ASSESSEE HAS DULY FURNISHED THE SOURCES OUT OF THE CASH WAS DEPOSITED AS THE A SSESSEE ITA NO.854/M/2016 SHRI ANOOP P. BABANI 3 WAS HAVING SUFFICIENT OPENING BALANCE AND MADE THE WITHDRAWALS DURING THE YEAR WHICH COMPLETELY EXPLAI N THE SOURCES OF DEPOSIT INTO THE BANK ACCOUNT OF THE ASS ESSEE AS GIVEN BY LD. CIT(A) IN PARA 4.17 OF THE APPELLATE ORD ER. THE LD. A.R. FINALLY SUBMITTED THAT SINCE THE ADDITION WAS MADE/SUSTAINED TOWARDS THE HOUSEHOLD EXPENSES BY HO LDING THAT THE MONEY WITHDRAWN FROM THE BANK WAS USED FOR THE PERSONAL PURPOSES OF HOUSEHOLD EXPENSES AND NOTHING WAS LEFT TO DEPOSIT INTO THE BANK ACCOUNT OF THE ASSESSEE. T HE LD. A.R. SUBMITTED THAT THIS IS JUST AN ESTIMATION/CONJECTUR E WITHOUT ANY CORROBORATING EVIDENCES. THEREFORE, THE PENALTY SHOULD BE DELETED. 6. THE LD. D.R., ON THE OTHER HAND, RELIED ON THE ORD ER OF AUTHORITIES BELOW AND SUBMITTED THAT SINCE THE ASSE SSEE HAS MADE INADEQUATE WITHDRAWAL AND LD. CIT(A) HAS CORREC TLY SUSTAINED RS.3 LAKHS TOWARDS WITHDRAWAL FOR HOUSEHOL D EXPENSES AND ITS ONLY ON THIS AMOUNT THE AO HAS IMP OSED PENALTY AND SAME SHOULD BE CONFIRMED. 7. AFTER HEARING THE RIVAL SUBMISSIONS AND PERUSING THE MATERIAL ON RECORD, WE FIND THAT THE AO HAS ADDED RS.11,32,085/- ON ACCOUNT OF DEPOSITS INTO SAVINGS BANK ACCOUNT UNDER SECTION 68 OF WHICH THE LD. CIT(A) SU STAINED ONLY RS.3 LAKHS TOWARDS WITHDRAWAL FOR HOUSEHOLD EXP ENSES THEREBY ALLOWING PART RELIEF AFTER CONSIDERING T HE REMAND REPORT DATED 21.08.2012. THE RELEVANT EXTRACT OF W HICH IS REPRODUCED BELOW: 2) DEPOSITS IN BANK OF BARODA SAVING A/C: AS PER T HE AIR INFORMATION, THE ASSESSEE WAS SHOWN TO HAVE MADE CASH DEPOSITS TO TH E EXTENT OF RS.11,32,085. THE ITA NO.854/M/2016 SHRI ANOOP P. BABANI 4 AO HAS DISALLOWED THE CLAIM OF THE ASSESSEE SINCE H E COULD NOT FURNISH THE SOURCE FOR INTRODUCTION OF CASH. THE SAME WAS ADDED BACK U/S 68 OF THE I.T. ACT AS UNEXPLAINED CASH CREDIT. DURING THE REMAND PROCEEDINGS, THE AR HAS SUBMITTED COPY OF BANK PASS BOOK AND THE CASH FLOW STATEMENT. IT HAS BEEN SUBMITTED BY THE AR THAT THE CASH HAS BEEN DEPOSITED FROM OWN SOURCES. THE AVAILABILITY OF CA SH HAVE BEEN VERIFIED FROM THE CASH BOOK AND FOUND TO BE IN ORDER. 8. IT IS CLEAR FROM THE ABOVE THAT THE DEPOSITS INT O THE BANK ACCOUNT OF THE ASSESSEE HAVE BEEN VERIFIED BY THE A O BY CHECKING THE CASH BOOK AND BANK BOOK OF THE ASSESSE E. HOWEVER, THE LD. CIT(A) SUSTAINED RS.3 LAKHS TOWARDS HOUSEHOLD EXPENSES. IN OUR OPINION, THIS IS MERE A CONFIRMATION ON THE BASIS OF ESTIMATION WITHOUT AN Y CONCRETE EVIDENCES OR CORROBORATION WHICH COULD PROVE THE FU RNISHING OF INACCURATE PARTICULARS OF INCOME BY THE ASSESSEE. IN SUCH A SCENARIO, WE ARE NOT IN AGREEMENT WITH THE CONCLUSI ON REACHED BY LD. CIT(A) QUA CONFIRMATION OF PENALTY. ACCORDIN GLY, WE HOLD THAT SINCE THE PENALTY WAS IMPOSED ON THE ADHO C ESTIMATION OF WITHDRAWAL FOR HOUSEHOLD EXPENSES WHI CH IN OUR OPINION IS WRONG AND HAS TO BE DELETED . 9. ACCORDINGLY, WE SET ASIDE THE ORDER OF LD. CIT(A) AND DIRECT THE AO TO DELETE THE PENALTY. 10. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED. ORDER PRONOUNCED IN THE OPEN COURT ON 10.08.2018. SD/- SD/- (JOGINDER SINGH) (RAJESH KUMAR) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI, DATED: 10.08.2018. * KISHORE, SR. P.S. ITA NO.854/M/2016 SHRI ANOOP P. BABANI 5 COPY TO: THE APPELLANT THE RESPONDENT THE CIT, CONCERNED, MUMBAI THE CIT (A) CONCERNED, MUMBAI THE DR CONCERNED BENCH //TRUE COPY// [ BY ORD ER DY /ASSTT. REGISTRAR, ITAT, MUMBAI.