Income-tax Officer, V. Rakesh Sudharkar Akole, Pune

ITA 893/PUN/2014

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 1080 (ITAT-PUNE)
• Duration Of Justice: 2 year(s) 3 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-08-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 20-07-2016
• Assessment Year: 2009-2010
• Appeal Filed On: 02-05-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: P L KUREEL
• Keywords: Unexplained investment; Additional evidence; Tax effect
• Section: 69

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, PUN E , ! # $% , & ' BEFORE SHRI VIKAS AWASTHY, JM AND SHRI PRADIP KUMAR KEDIA, AM ( / ITA NO. 741/PN/2014 ) * +* / ASSESSMENT YEAR : 2009-10 MR. RAKESH SUDHAKAR AKOLE, GAT NO. 1635, RAMDAS NAGAR, SONAWANE WASTI ROAD, CHIKHALI, PUNE-412114, MAHARASHTRA PAN : AHAPA9244R ....... / APPELLANT ) / V/S. INCOME TAX OFFICER, WARD 9(1), PUNE / RESPONDENT ( / ITA NO. 893/PN/2014 ) * +* / ASSESSMENT YEAR : 2009-10 INCOME TAX OFFICER, WARD 9(1), PUNE ....... / APPELLANT ) / V/S. MR. RAKESH SUDHAKAR AKOLE, GAT NO. 1635, RAMDAS NAGAR, SONAWANE WASTI ROAD, CHIKHALI, PUNE-412114, MAHARASHTRA PAN : AHAPA9244R / RESPONDENT ASSESSEE BY : SHRI SUNIL GANOO REVENUE BY : SHRI P.L. KUREEL / DATE OF HEARING : 25-07-2016 / DATE OF PRONOUNCEMENT : 24-08-2016 2 ITA NOS. 741 & 893/PN/2014, A.Y. 2009-10 , / ORDER PER VIKAS AWASTHY, JM : THESE APPEALS BY THE ASSESSEE AND THE REVENUE ARE DIR ECTED AGAINST THE ORDER OF COMMISSIONER OF INCOME TAX (APPEALS) -V, PUNE DATED 28-01-2014 FOR THE ASSESSMENT YEAR 2009-10. 2. THE BRIEF FACTS OF THE CASE AS EMANATING FROM RECORDS ARE: THE ASSESSEE IS AN ADVOCATE BY PROFESSION. THE ASSESSEE FILED HIS RETURN OF INCOME FOR THE IMPUGNED ASSESSMENT YEAR ON 22-12-2009 DECLARING TOTAL INCOME OF ` 2,24,650/-. THE CASE OF THE ASSESSEE WAS SELECTED FOR SCRUTINY UNDER CASS. DURING THE COURSE OF SCRUTINY ASSE SSMENT, THE ASSESSING OFFICER INTER ALIA MADE ADDITION ON ACCOUNT OF UNEX PLAINED INVESTMENT ` 20,37,514/-. THE ASSESSING OFFICER FURTHER MADE ADDITION OF ` 5,58,000/- U/S. 69 OF THE INCOME TAX ACT, 1961 (HEREINAFTER REFERR ED TO AS THE ACT) ON ACCOUNT OF CASH PAYMENT MADE BY T HE ASSESSEE ALLEGEDLY FOR PURCHASE OF LAND SITUATED AT GAT NO. 357, KHA RABWADI, CHAKAN, PUNE. AGGRIEVED BY THE ASSESSMENT ORDER DATED 29-11-2011, T HE ASSESSEE PREFERRED AN APPEAL BEFORE THE COMMISSIONER OF I NCOME TAX (APPEALS). THE COMMISSIONER OF INCOME TAX (APPEALS) VIDE IMPU GNED ORDER PARTLY ACCEPTED THE APPEAL OF THE ASSESSEE AND DELETED THE ADDITION OF ` 15,37,514/- FROM THE TOTAL ADDITION OF ` 20,37,514/-. THUS, THE COMMISSIONER OF INCOME TAX (APPEALS) CONFIRMED THE ADDIT ION OF ` 5,00,000/-. THE COMMISSIONER OF INCOME TAX (APPEALS) FURTHER CONFIRMED THE ADDITION OF ` 5,58,000/- BY DISBELIEVING THE CONTENTIONS OF THE ASSESSEE. AGAINST THE FINDINGS OF COMMISSIONER OF INC OME TAX 3 ITA NOS. 741 & 893/PN/2014, A.Y. 2009-10 (APPEALS), BOTH, THE ASSESSEE AND THE REVENUE ARE IN APPE AL BEFORE THE TRIBUNAL. THE ASSESSEE IS IN APPEAL AGAINST THE ADDITION O F ` 5,00,000/- AND ` 5,58,000/- ON ACCOUNT OF ALLEGED UNDISCLOSED INVESTMENTS. WHEREAS, THE REVENUE IS IN APPEAL AGAINST THE ADDITION DE LETED BY THE COMMISSIONER OF INCOME TAX (APPEALS). 3. SHRI SUNIL GANOO APPEARING ON BEHALF OF THE ASSESSEE S UBMITTED THAT THE ASSESSEE HAD RECEIVED ` 5,00,000/- IN CASH FROM HIS BROTHER SHRI SANTOSH SUDHAKAR AKOLE FOR PURCHASE OF PLOT. HOWEVE R, THE DEAL COULD NOT BE FINALIZED AND THE ASSESSEE RETURNED THE SAID AMOUNT VIDE CHEQUE WHICH WAS DEPOSITED IN THE BOOK ACCOUNT OF HIS BR OTHER ON THE SAME DAY. THE AUTHORITIES BELOW HAVE ERRED IN NOT ACCEP TING THE CONTENTIONS OF THE ASSESSEE. THE LD. AR OF THE ASSESSEE REFERRED TO BANK STATEMENT OF ASSESSEE TO SHOW THAT THE CASH RECEIVED FROM SANTOSH SUDHAKAR AKOLE WAS DEPOSITED IN THE BANK ACCOUNT OF THE ASSESSEE ON 03-07-2003 AND THE ON THE SAME DATE THE SAID AMOUNT WAS RETURNED BY CHEQUE TO SHRI SANTOSH SUDHAKAR AKOLE. 3.1 THE LD. AR OF THE ASSESSEE CONTENDED THAT THE AUTH ORITIES BELOW HAVE ERRED IN MAKING THE ADDITION OF ` 5,58,000/- PAID BY ASSESSEE IN CASH TO HIS BROTHER SHRI NIRMAL SUDHAKAR AKOLE. IT WAS S UBMITTED THAT THE BROTHER OF THE ASSESSEE SHRI NIRMAL SUDHAKAR AKOLE H AD PURCHASED A LAND SITUATED AT GAT NO. 357, KHARABWADI, CHAKAN, PUNE FO R A TOTAL CONSIDERATION OF ` 10,00,000/-. OUT OF THE TOTAL SAID CONSIDERATION AN AMOUNT OF ` 4,00,000/- WAS PAID IN CASH AND ` 1,58,000/- TOWARDS STAMP DUTY AND REGISTRATION CHARGES WAS ALSO PAID IN CA SH. THE LD. AR REFERRED TO THE CASH BOOK OF SHRI NIRMAL SUDHAKAR AKOLE T O SHOW THAT ` 4,00,000/- WAS PAID IN CASH TO THE SELLER OF LAND, ` 1,28,000/- WAS 4 ITA NOS. 741 & 893/PN/2014, A.Y. 2009-10 PAID TOWARDS STAMP DUTY AND ` 30,760/- WAS PAID TOWARDS REGISTRATION FEE. THE LD. AR CONTENDED THAT THE ASSESSEE WAS REQUIRE D TO PROVE THE IDENTITY OF CREDITORS, GENUINENESS OF THE TRANSACTIONS AND CREDITWORTHINESS OF THE CREDITORS. THE ASSESSEE HAS DISC HARGED HIS ONUS BY SATISFYING THE THREE CONDITIONS. THE LD. AR PRAYE D THAT THE ASSESSEE IS FILING ADDITIONAL EVIDENCE IN THE FORM OF ACKNOWLE DGMENT OF INCOME TAX RETURN FILED BY SHRI SANTOSH SUDHAKAR AKOLE, A COPY OF INCOME AND EXPENDITURE ACCOUNT AND BALANCE SHEET AS ON 31-03-2009 ALONG WITH THE CONFIRMATION LETTERS OF UNSECURED CREDITORS AND THE EXTRACT OF SAVING BANK ACCOUNT MAINTAINED BY SHRI SANTOS H SUDHAKAR AKOLE WITH ICICI BANK. A COPY OF AFFIDAVIT JOINTLY EXECUTED BY ASSESSEE AND SHRI NIRMAL SUDHAKAR AKOLE, A COPY OF PROFIT AND LOSS A CCOUNT AND BALANCE SHEET AS ON 31-03-2009 ALONG WITH CONFIRMATION LET TERS OF LOAN AND ADVANCES IN THE CASE OF SHRI NIRMAL SUDHAKAR AKOLE AND A COPY OF CASH BOOK OF SHRI NIRMAL SUDHAKAR AKOLE FOR THE PERIOD 0 1-04-2008 TO 31-03-2009. THE ABOVE SAID DOCUMENTS ARE FILED AS ADDITIO NAL EVIDENCE TO SUPPORT THE CLAIM OF ASSESSEE. 3.2 THE LD. AR OF THE ASSESSEE FURTHER SUBMITTED THAT THE ASSESSING OFFICER HAS NOT MADE INVESTIGATION IN THE RIGHT PROSPECTIVE TO ASCERTAIN THE GENUINENESS OF THE TRANSACTIONS. THE LD. AR IN ORDER TO BUTTRESS HIS ARGUMENTS PLACED RELIANCE ON THE FOLLOWING DECISIONS : I. COMMISSIONER OF INCOME TAX VS. TANIA INVESTMENTS P. LTD., 322 ITR 394 (BOM); II. NEMI CHAND KOTHARI VS. COMMISSIONER OF INCOME TAX, 264 IT R 254 (GAU); III. ITO VS. SMT. INDIRA KAMALAKAR YEULA IN ITA NO. 021/PN/2012 FOR ASSESSMENT YEAR 2006-07 DECIDED ON 27-11-2012. 5 ITA NOS. 741 & 893/PN/2014, A.Y. 2009-10 4. PER CONTRA SHRI P.L. KUREEL REPRESENTING THE DEPARTME NT VEHEMENTLY SUPPORTED THE ORDER OF COMMISSIONER OF INCO ME TAX (APPEALS) IN CONFIRMING THE ADDITION. THE LD. DR SUBMITTED THAT THE ASSESSEE DURING THE ASSESSMENT PROCEEDINGS FAILED TO PLAC E ON RECORD ANY DOCUMENTS WHATSOEVER TO SUPPORT HIS CONTENTIONS. NO PLAUSIBLE EXPLANATION WAS FURNISHED BY THE ASSESSEE DURING ASSESSM ENT PROCEEDINGS OR DURING THE FIRST APPELLATE PROCEEDINGS IN SUPPORT OF HIS CONTENTIONS. THE DOCUMENTS WHICH HAVE NOW BEEN PLACED ON RECORD AS ADDITIONAL EVIDENCE WERE AVAILABLE BEFORE THE ASSESSEE EVEN AT THE TIME OF ASSESSMENT. HOWEVER, THE ASSESSEE DID NOT FURNISH THE SAME AND NO EXPLANATION HAS BEEN OFFERED FOR NOT PROVIDING THESE DOCUM ENTS TO ASSESSING OFFICER. THE LD. DR REFERRED TO THE FINDINGS OF COMM ISSIONER OF INCOME TAX (APPEALS) IN PARAS 10 AND 14 OF THE IMPUGNED O RDER. THE LD. DR POINTED THAT THE COMMISSIONER OF INCOME TAX (APPEALS ) HAS CATEGORICALLY OBSERVED THAT THE ADDITIONAL EVIDENCE FILED B Y THE ASSESSEE IN RESPECT OF SHRI SANTOSH SUDHAKAR AKOLE CANNOT BE AD MITTED AS THE SAME WERE NOT PRODUCED BEFORE THE ASSESSING OFFICER AND ALSO BECAUSE IT APPEARS TO HAVE BEEN PREPARED SIMPLY FOR THE PURPOS E OF EXPLAINING THE TRANSACTIONS. SIMILARLY, IN RESPECT OF TRANSACTION WITH SHRI NIRMAL SUDHAKAR AKOLE THE COMMISSIONER OF INCOME TAX (APPEALS) RE FUSED TO ACCEPT THE ADDITIONAL EVIDENCE AS NO REASON WAS GIVEN BY THE ASSESSEE FOR NOT FURNISHING THE DOCUMENTS AT THE TIME OF ASSESSMEN T PROCEEDINGS. THE LD. DR PRAYED FOR DISMISSING THE APPEAL OF THE ASSESSEE. 5. IN RESPECT OF APPEAL FILED BY THE DEPARTMENT THE LD. DR FAIRLY ADMITTED THAT THE APPEAL SUFFERS FROM LOW TAX EFFECT IN VIEW OF THE CBDT CIRCULAR NO. 21/2015, DATED 10-12-2015. 6 ITA NOS. 741 & 893/PN/2014, A.Y. 2009-10 6. WE HAVE HEARD THE SUBMISSIONS MADE BY THE REPRESEN TATIVES OF RIVAL SIDES AND HAVE PERUSED THE ORDERS OF THE AUTHORITIE S BELOW. WE HAVE ALSO EXAMINED THE DOCUMENTS FILED BY THE ASSESSEE A S ADDITIONAL EVIDENCE. IN APPEAL THE ASSESSEE HAS ASSAILED THE FINDINGS OF COMMISSIONER OF INCOME TAX (APPEALS) ON TWO GROUNDS : I. CONFIRMING THE ADDITION OF ` 5,00,000/- IN RESPECT OF UNEXPLAINED INVESTMENT. II. CONFIRMING THE ADDITION OF ` 5,58,000/- AS UNEXPLAINED INVESTMENT IN RESPECT OF PROPERTY COMPRISING IN GAT NO. 3 57, KHARABWADI, CHAKAN, PUNE. 7. IN SO FAR GROUND NO. 1 RELATING TO THE ADDITION OF ` 5,00,000/- AS UNEXPLAINED INVESTMENT, THE CONTENTION OF THE ASSESSEE IS THAT THE AMOUNT OF ` 5,00,000/- RECEIVED IN CASH BY THE ASSESSEE FROM HIS BROTHER SHRI SANTOSH SUDHAKAR AKOLE FOR THE PURCHASE O F PLOT WAS RETURNED BY CHEQUE ON THE SAME DATE. SINCE, THE DEAL COULD NOT BE FINALIZED THE AMOUNT WAS DEPOSITED IN THE BANK ACCOUNT O F SHRI SANTOSH SUDHAKAR AKOLE ON THE SAME DAY THROUGH CHEQU E. THE ASSESSEE HAS FILED BANK STATEMENT OF SHRI SANTOSH SUDHAK AR AKOLE AS WELL AS HIS OWN BANK STATEMENT IN SUPPORT OF HIS SUBMISSION S. THE ASSESSEE HAS ALSO FILED BALANCE SHEET OF SHRI SANTOSH S UDHAKAR AKOLE AS ADDITIONAL EVIDENCE IN SUPPORT OF HIS CONTENTIONS. 8. IN RESPECT OF ADDITION OF ` 5,58,000/- THE LD. AR OF THE ASSESSEE CONTENDED THAT ` 4,00,000/- WAS PAID IN CASH FOR PURCHASE OF PLOT AND ` 1,58,000/- WAS PAID IN CASH FOR REGISTRATION AND STAMP DUT Y CHARGES. THE LD. AR OF THE ASSESSEE IN SUPPORT OF HIS SUBMISSIONS HA S FILED A 7 ITA NOS. 741 & 893/PN/2014, A.Y. 2009-10 COPY OF CASH BOOK, PROFIT AND LOSS ACCOUNT AND BALANCE S HEET OF SHRI NIRMAL SUDHAKAR AKOLE. ALTHOUGH, NO PLAUSIBLE REASON WAS FURNISHED BY THE ASSESS EE FOR NOT FURNISHING THESE DOCUMENTS BEFORE THE ASSESSING OFFICE R, IF THE SAME WERE AVAILABLE WITH THE ASSESSEE AT THE TIME OF ASSE SSMENT. A PERUSAL OF IMPUGNED ORDER SHOWS THAT THE ASSESSEE HAD FILED CERTAIN DOCUMENTS TO SUPPORT HIS CONTENTIONS AT FIRST APPELLATE STAGE BUT THE SAME WERE REJECTED BY THE COMMISSIONER OF INCOME TAX (A PPEALS). IN SUCH CIRCUMSTANCES, WE DEEM IT APPROPRIATE TO REMIT THE FILE BACK TO THE ASSESSING OFFICER TO CONSIDER THE DOCUMENTS FURNISHED BY T HE ASSESSEE DURING APPEAL AND EXAMINE THE TWO TRANSACTIONS AFRESH WH ICH HAVE BEEN ASSAILED BY THE ASSESSEE BEFORE THE TRIBUNAL. NEEDLE SS TO SAY THAT BEFORE RE-EXAMINING THE TRANSACTIONS THE ASSESSING OFFICER SHALL GRANT AN OPPORTUNITY OF HEARING TO THE ASSESSEE, IN ACCORDANCE WITH LAW. ACCORDINGLY, THE APPEAL OF THE ASSESSEE IS ALLOWED FOR STAT ISTICAL PURPOSE. 9. THE DEPARTMENT IN ITS APPEAL HAS ASSAILED THE FINDINGS O F COMMISSIONER OF INCOME TAX (APPEALS) IN DELETING THE ADDITION OF ` 15,37,514/- ON ACCOUNT OF UNEXPLAINED INVESTMENT U/S. 69 O F THE ACT. UNDISPUTEDLY, THE TAX EFFECT IN THE PRESENT APPEAL IS LESS THAN ` 10 LAKHS. THE CBDT VIDE CIRCULAR NO. 21/2015, DATED 10-12-2 015 HAS RAISED THE MONETARY LIMIT OF TAX EFFECT FOR FILING OF APPEALS BY THE DEPARTMENT BEFORE THE TRIBUNAL TO ` 10 LAKHS. THE CIRCULAR APPLIES TO THE APPEALS TO BE FILED BY THE DEPARTMENT IN FUTURE, AS WE LL AS THE APPEALS PENDING BEFORE THE TRIBUNAL. THUS, IN VIEW OF THE CB DT 8 ITA NOS. 741 & 893/PN/2014, A.Y. 2009-10 CIRCULAR THE PRESENT APPEAL OF THE REVENUE IS LIABLE TO BE DISMISSED ON ACCOUNT OF LOW TAX EFFECT. 10. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED FO R STATISTICAL PURPOSE AND THE APPEAL OF THE REVENUE IS DISMISSED. ORDER PRONOUNCED ON WEDNESDAY, THE 24 TH DAY OF AUGUST, 2016. SD/- SD/- (PRADIP KUMAR KEDIA) (VIKAS AWASTHY) / ACCOUNTANT MEMBER / JUDICIAL MEMBER / PUNE; !' / DATED : 24 TH AUGUST, 2016 RK ,-#./0+. / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT. 2. / THE RESPONDENT. 3. # # $ () / THE CIT(A)-V, PUNE 4. # # $ / THE CIT-V, PUNE 5. '() *+ , # *+ , , ,-. , / DR, ITAT, B BENCH, PUNE. 6. )/0 12 / GUARD FILE. // ' // TRUE COPY// #3 / BY ORDER, 4 *. / PRIVATE SECRETARY, # *+ , / ITAT, PUNE