Appeal details
Counselvise Citation
[2015] 134 COUNSELVISE.COM (IT) 2867 (ITAT-MUMBAI)
Assessee PAN
Bench
Appeal Number
Duration Of Justice
4 year(s) 9 month(s) 28 day(s)
Appellant
Respondent
Appeal Type
Income Tax Appeal
Pronouncement Date
28-10-2015
Appeal Filed By
Assessee
Order Result
Allowed
Bench Allotted
A
Next Hearing Date
27-07-2015
Assessment Year
2006-2007
Appeal Filed On
31-12-2010
Judgement Text
IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, MUMBAI BEFORE SHRI G.S.PANNU, ACCOUNTANT MEMBER AND SHRI SANJAY GARG, JUDICIAL MEMBER ITA NO.9206/MUM./2010 (ASSESSMENT YEAR : 2006-07 ) KETAN B. MEHTA, C/O. KAPOOR & PAREKH ASSOCIATES, 157, ZAVERI BUILDING, PRINCESS STREET, MUMBAI 400 002 .. APPELLANT V/S INCOME TAX OFFICER 11(2)(4), 4 TH FLOOR, AAYAKAR BHAVAN, MUMBAI 400 020 .... RESPONDENT ASSESSEE BY : SHRI VIJAY MEHTA & GOVIND JHAVERI, A.R. REVENUE BY : SHRI S.P.WALIMBE, D.R. DATE OF HEARING 27.07.2015 DATE OF ORDER 28.10 .2015 O R D E R PER SANJAY GARG, JUDICIAL MEMBER THIS APPEAL PREFERRED BY THE ASSESSEE IS AGAINST TH E ORDER DATED 17.08.2010 PASSED BY THE LEARNED COMMISSIONER OF IN COME TAX (APPEALS) [HEREAFTER REFERRED TO AS CIT(A)], MUMBAI FOR THE A SSESSMENT YEAR 2006-07. 2. THE GROUNDS OF APPEAL TAKEN BY THE ASSESSEE ARE AS UNDER: 1. THE ASSESSEE PRAYS THAT THE DELAY OF 47 DAYS IN FILING THIS APPEAL MAY PLEASE BE CONDONED AND APPEAL BE HEARD. 2. ASSESSMENT ORDER PASSED BY L.D. CIT (A) - III IS ARBITRARY, ERRONEOUS, AND BAD IN LAW. ITA NO.9206/M/10 KETAN B. MEHTA A.Y.2006-07 2 3. ON THE FACTS AND CIRCUMSTANCES OF THE FACTS THE LEARNED ITO AS WELL AS CIT (A) - III ERRED IN TREATING CASH DEPOSITS OF RS .L2,55,OOOI- IN THE BANK AS UNEXPLAINED CASH CREDIT U/S 68 OF THE INCOME TAX AC T, 1961 AND ADDING THE SAME TO THE TOTAL INCOME OF THE APPELLANT. 3. AT THE TIME OF HEARING IT WAS NOTED THAT THE APP EAL IS BARRED BY LIMITATION BY 47 DAYS. AFTER HEARING THE RIVAL PAR TIES AND PERUSING THE MATERIAL AVAILABLE ON RECORD INCLUDING THE AFFIDAVI T DATED 27.12.2010 OF THE ASSESSEE WHEREIN, IT HAS BEEN STATED THAT DUE TO TH E PURSUANCE OF AUDIT WORK, THE ORDER OF THE CIT(A) WAS MISPLACED ALONG WITH TH E BUNCH OF PAPERS AND AFTER GETTING ANOTHER COPY OF THE ORDER OF THE CIT( A), THE APPEAL WAS FILED IMMEDIATELY, THEREFORE, THE DELAY MAY BE CONDONED, THE DELAY IN THE ABSENCE OF ANY CONTRARY MATERIAL PLACED ON RECORD BY THE LD . DR, IS CONDONED AND APPEAL IS ADMITTED. 4. BRIEFLY STATED THE FACTS OF THE CASE ARE THAT TH E ASSESSEE IS A C.A. BY PROFESSION. DURING THE ASSESSMENT YEAR UNDER CONSI DERATION, THE ASSESSEE DECLARED INCOME FROM PROFESSION AND OTHER SOURCES. ON PERUSAL OF THE RECORD IT WAS FOUND BY THE ASSESSING OFFICER (HEREINAFTER REFERRED TO AS THE AO) THAT THE ASSESSEE HAD DEPOSITED CASH OF RS.12,55,000/- I N HIS SAVING BANK ACCOUNT WITH INDIAN OVERSEAS BANK A/C. NO. 8177, JUHU, MUMB AI ON 31.03.2006. IN REPLY TO THE SHOW CAUSE NOTICE AS TO WHY THE SAME S HOULD NOT BE TREATED AS UNEXPLAINED CASH CREDIT AND WHY THE SAME SHOULD NOT BE ASSESSED BACK TO THE TOTAL INCOME OF THE ASSESSEE; THE ASSESSEE SUBMITT ED AS UNDER: AS REGARDS TO YOUR SHOW CAUSE NOTICE THAT THE ASSE SSEE HAS DEPOSITED CASH AGGREGATING TO RS.12,55,000/- IN HIS SAVINGS ACCOUN T WITH INDIAN OVERSEAS BANK BEARING ACCOUNT NO.8177 DURING THE YEAR AND WHY THE SAME SHOULD NOT BE TREATED AS UNEXPLAINED INVESTMENT WE ON BEHALF OF THE ASSES SEE SUBMIT THAT THE SAID AMOUNT DEPOSITED IS OUT OF CASH WITHDRAWN BY HIM FR OM HIS BANK IN EARLIER YEARS. HE WAS HOLDING SUFFICIENT CASH BALANCES ON THE DATE FROM WHICH HE HAS DEPOSITED CASH OF RS.12,55,000/- IN INDIAN OVERSEAS BANK. WE ARE ENCLOSING COPY OF HIS BALANCE SHEET AS ON 31.03.2004 AND 31.03.5005 FOR Y OUR PERUSAL WHEREIN AS ON 31.03.2005 CASH ON HAND IS RS.18,58,818/-. WE ARE ENCLOSING COPY OF HIS BANK ITA NO.9206/M/10 KETAN B. MEHTA A.Y.2006-07 3 STATEMENT ALONG WITH BANK SUMMARY FROM WHICH IT IS EVIDENT THAT THE CASE HAS BEEN WITHDRAWN IN THESE YEARS AND OUT OF WHICH CASH HAS BEEN DEPOSITED. THEREFORE IN LIEU OF THE ABOVE EXPLANATION THE CASH DEPOSITED OF RS.12,55,000/- IN SAVINGS ACCOUNT OF INDIAN OVERSEAS BANKS STANDS DUL Y EXPLAINED. CONSIDERING THE ABOVE WE REQUEST YOU NOT TO TREAT C ASH DEPOSIT OF RS.12,55,000/- AS UNEXPLAINED INVESTMENT AND NOT TO MAKE ANY ADDITION ON THIS ACCOUNT. 5. HOWEVER, THE A.O ON EXAMINATION OF THE ASSESSEE S BALANCE SHEET FOUND THAT DURING THE YEAR THE ASSESSEE HAD TOTAL C ASH/BANK BALANCE RS.16,45,983/- ONLY OUT OF WHICH ASSESSEE HAD WITHD RAWN RS.14,47,000/- FOR PAYMENTS/INVESTMENTS ETC., THEREFORE, ACCORDING TO THE A.O., THE BANK BALANCE AVAILABLE WITH THE ASSESSEE WAS RS.1,98,983/- ONLY AND THUS THE ASSESSEE WAS NOT IN A POSITION TO DEPOSIT CASH RS. 12,55,000/-. THEREFORE HE TREATED THE CASH DEPOSIT OF RS.12,55,000/- IN THE BANK ACCOUNT AS UNEXPLAINED CASH CREDIT AND ACCORDINGLY ADDED THE SAME TO THE TOTAL INCOME OF THE ASSESSEE. 6. ON APPEAL, THE LD. CIT(A) UPHELD THE ADDITION SO MADE BY THE A.O. 7. BEFORE US, THE LD. AR OF THE ASSESSEE, WHILE RET REATING THE SAME SUBMISSIONS AS SUBMITTED BEFORE THE A.O. AND CIT(A) HAS FURTHER INVITED OUR ATTENTION TO HIS APPLICATION FOR FURNISHING OF ADDITIONAL EVIDENCE MOVED UNDER RULE 29 OF THE ITAT RULES TO CONTEND THAT THE ASSESSEE HAD FILED THE SUMMARY OF CASH DEPOSITS AND CASH WITHDRAWALS BEFOR E THE AO AS WELL AS BEFORE THE CIT(A). THE ASSESSEE WAS UNDER BONAFIDE BELIEF THAT THE SAME WOULD BE DULY CONSIDERED BY THE LOWER AUTHORITIES. TO SUBSTANTIATE HIS CLAIM, THE ASSESSEE SEEKS TO TENDER CASH BOOK AND RECONCIL IATION STATEMENT, WHICH DOCUMENTS ARE VERY MUCH NECESSARY TO BE LOOKED INTO TO ARRIVE AT PROPER CONCLUSION OF THE CASE. THE LD. AR HAS FURTHER SUBM ITTED THAT THE A.O. WHILE CALCULATING THE BANK BALANCE RS.1,98,983/- HAS NOT CONSIDEREDS THE PROFIT OF RS.95,187/- AND HAS WRONGLY DEBITED THE EARLIER YEA R WITHDRAWAL I.E. FOR ITA NO.9206/M/10 KETAN B. MEHTA A.Y.2006-07 4 A.Y.2005-06 AMOUNTING TO RS.14,47,000/-. THE LD. A R IN THIS RESPECT HAS RELIED UPON THE RECONCILIATION STATEMENT, SOUGHT T O BE PRODUCED AS ADDITIONAL EVIDENCE. IT HAS BEEN CONTENDED THAT AS PER BALANCE SHEET AS ON 31.03.2005, CASH AND BANK BALANCE RS.19,61,339/- WAS AVAILABLE OUT OF WHICH CASH IN HAND WAS SHOWN AT RS.18,58,818/- AS ON 31.03.2005 AND THE SAME CASH IN HAND WAS BROUGHT FORWARD AS ON 01.04.2005, OUT OF W HICH THE ASSESSEE HAD DEPOSITED RS.12,55,000/- IN THE BANK ACCOUNT. IT HA S THEREFORE BEEN CONTENDED THAT THE CASH WAS DEPOSITED OUT OF CASH I N HAND AVAILABLE WITH THE ASSESSEE. THE RELIANCE HAS ALSO BEEN PLACED ON DECI SION OF THE TRIBUNAL IN ITO13(1)(2) VS. M/S. CELLPLUS TELECOMES, MUMBAI IN ITA 957/M/2009 FOR A.Y. 2005-06 DATED 18.06.2010WHEREIN IT HAS BEEN OB SERVED AS UNDER: IT IS ALSO NOT THE CASE OF THE REVENUE THAT THE RE LEVANT ENTRIES RECORDED IN THE CASE BOOK ARE FOUND TO BE FALSE OR UNTRUE. MERELY BECAUSE THERE IS A TIME GAP OF FEW MONTHS DOES NOT MEAN THAT THE DEP OSITS MADE BY THE PARTNERS OF THE FIRM ARE NOT GENUINE OR THE PARTNER S HAVE NO CAPACITY TO DEPOSIT RS.12,05,000/- IN THE BANK ACCOUNT OF THE F IRM. IN FACT, THERE WAS NO FURTHER NEED ON THE PART OF THE ASSESSEE TO PROV E THE DEPOSITS. THE ONUS WAS ON THE REVENUE TO DISPROVE THE SAME WHICH HAS NOT BEEN DISCHARGED. IN THIS VIEW OF THE MATTER WE ARE OF T HE VIEW THAT THE ASSESSEE NOT ONLY DISCHARGED THE ONUS PLACED UPON H IM U/S.68 OF THE ACT IN ORDER TO PROVE THE SOURCE OF MONEY OF RS.12,05,0 00/- INTRODUCED IN THE BANK ACCOUNT BUT ALSO ADDUCED POSITIVE EVIDENCE/NEX US REQUIRED FOR THE PURPOSE. THIS VIEW ALSO FINDS SUPPORT FROM THE DEC ISION IN ADDITIONAL CIT VS. MOHAN ENGINEERING CO. (1985)151 ITR 571(PAT.). ON THE OTHER HAND THE LD. D.R. SUPPORTED THE CASE OF THE AUTHORITIES BELOW. 8. WE FIND THAT THE ABOVE CONTENTIONS RAISED BY THE LD. AR HAVE NOT BEEN LOOKED INTO BY THE LOWER AUTHORITIES. THE STAND OF THE ASSESSEE THAT THE DEPOSITS WERE MADE OUT OF THE CASH IN HAND AS PER B OOKS OF ACCOUNTS HAS NOT BEEN EXAMINED. THE DOCUMENTS SOUGHT TO BE PRODUCED AS ADDITIONAL EVIDENCE ARE VERY MUSH NECESSARY FOR THE JUST AND PROPER DEC ISION OF THE CASE. WE ITA NO.9206/M/10 KETAN B. MEHTA A.Y.2006-07 5 THEREFORE SET ASIDE THE IMPUGNED ORDER OF THE CIT(A ) AND RESTORE THE MATTER TO THE FILE OF THE AO WITH A DIRECTION TO ADMIT THE AD DITIONAL EVIDENCES AS MAY BE PRODUCED BY THE ASSESSEE IN JUSTIFICATION OF HIS CLAIM INCLUDING THE RECONCILIATION STATEMENT, BALANCE SHEET AND THE CAS H BOOK ETC. SOUGHT TO BE PRODUCED BEFORE US AND DECIDE THE ISSUE A FRESH AFT ER GIVING PROPER OPPORTUNITY TO THE ASSESSEE TO REPRESENT HIS CASE A ND ALSO CONSIDERING THE RELEVANT CASE LAWS RELIED UPON BY THE LD. AR. IN TH E RESULT, THE APPEAL OF THE ASSESSEE IS TREATED AS ALLOWED FOR STATISTICAL PURP OSES. ORDER PRONOUNCED IN THE OPEN COURT ON 28.10.2015 SD/- SD/- (G.S.PANNU) (SANJAY GARG) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI, DATED: 30.10.2015. * M.P. . COPY TO: THE APPELLANT THE RESPONDENT THE CIT, CONCERNED, MUMBAI THE CIT (A) CONCERNED, MUMBAI THE DR CONCERNED BENCH //TRUE COPY// [ BY ORDER D Y/ASSTT. REGISTRAR, ITAT, MUMBAI.
