Sejal Sharamik Masturlal, Bangalore V. ITO, Bangalore

ITA 955/BANG/2016

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 5570 (ITAT-BANGALORE)
• Duration Of Justice: 1 year(s) 9 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-02-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 01-06-2017
• Assessment Year: 2008-2009
• Appeal Filed On: 09-05-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: DR PRA DEEP KUMAR
• Assessee Lawyers: ASHOK KULKARNI
• Keywords: Unexplained investment; Source of fund
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH, B ENGALURU BEFORE S HRI SUNIL KUMAR YADAV, JUDICIAL MEMBER AND SHRI INTURI RAMA RAO, ACCOUNTANT MEMBER I TA NO. 955 / BANG/2 0 1 6 (ASSESSMENT YEAR: 20 08 - 09 ) SMT. SEJAL SHARAMIK MASTURLAL, 16(1), VRINDAVAN 7 TH MILE BANNERGHATTA ROAD, BENGALURU - 560076. VS. APPELLANT INCOME - TAX OFFICER, WARD 14(2), BENGALURU. RESPONDENT APPELLANT BY : SHRI ASHOK KULKARNI, ADVOCATE. RESPONDENT BY : DR.PRADEEP KUMAR, ADDL.CIT DATE OF HEARING : 28 / 1 1 /2017 DATE OF PRONOUNCEMENT : 09 / 02 /201 8 O R D E R PER I NTURI RAMA RAO, AM : THIS IS AN APPEAL FILED BY THE ASSESSEE DIRECTED AGAINST THE ORDER OF THE LD. COMMISSIONER OF INCOME - T AX(APPEALS) - 12 , BANGALORE,[CIT(A)] DATED 14/03/2016 FOR THE ASSES SMENT YEAR 2008 - 09. 2. THE ASSESSEE RAISED THE FOLLOWING GROUNDS OF APPEAL: ITA NO . 955 /BANG/201 6 PAGE 2 OF 5 3 . BRIEFLY, THE FACTS OF THE CASE ARE THAT THE ASSESSEE IS AN INDIVIDUAL, DERIVING INCOME FROM OTHER SOURCES . THE RETURN OF INCO ME FOR THE ASSESSMENT YEAR 2008 - 09 WA S FILED ON 14/11/2008 D ECLARING TOTAL INCOME OF RS.1,88,530/ - . AGAINST THE SAID RETURN OF INCOME, THE ASSESSMENT WAS COMPLETED BY THE INCOME TAX OFFICER, WARD 14(2), BANGALORE, VIDE ORDER DATED 30 - 12 - 2010 PASSED UNDER SECTION 143(3) OF THE INCOME - TAX ACT, 1961 [HEREINAFTER REFERRED TO AS THE ACT ] AT TOTAL INCOME RS.16,62,912/ - . WHILE DOING SO, THE ASSESSING OFFICER MADE ADDITION OF RS.11,50,000/ - AS UNEXPLAINED INVESTMENT IN THE FOLLOWING MUTUAL FUNDS: ITA NO . 955 /BANG/201 6 PAGE 3 OF 5 THE ASSESSING OFFICER ALSO MADE ADDITION ON ACCO UNT OF SHORT TERM CAPITAL GAIN UP OF RS.2,24,384/ - . THE FACTS SET OUT BY THE ASSESSING OFFICER ARE AS UNDER: 4 . BEING AGGRIEVED BY THE ABOVE ADDITION, AN APPEAL WAS PREFERRED BEFORE THE LD.CIT(A) WHO, VIDE IMPUGNED ORDER, CONFIRMED THE ACTION OF THE ASSESSING OFFICER. 5 . BEING AGGRIEVED, THE ASSESS E E IS IN APPEAL BEFORE US. I T IS CONTENDED THAT THE INVESTMENTS ARE MADE BY THE ASSESSEE S SON FROM THE BANK ACCOUNT JOINTLY HELD BY ASSESSEE WITH HER SON RUSHAB MASTURLAL. A LL ITA NO . 955 /BANG/201 6 PAGE 4 OF 5 THESE INVESTMENTS ARE DU LY REFLECTED IN THE BANK ACCOUNT STATEMENT . T HE REFORE, QUESTION OF TREATING THE INVESTMENT AS UNEXPLAINED INVESTMENT DOES NOT ARISE. I N THIS CONNECTION , THE LEARNED COUNSEL FOR THE ASSESSEE DRAWN OUR ATTENTION TO THE STATEMENT OF ACCOUNT HELD WITH C ITIBANK PLACED AT PAGE 5 OF THE PAPER BOOK . 5 .1 AS REGARDS AD DITION UNDER CAPITAL GAINS , IT IS SUBMITTED THAT THE ASSESSEE WAS HOLDING JOINT ACCOUNT ALONG WITH H ER MOTHER SMT.ANUPAM SHAH WITH IDBI BANK , SARAKKI B RANCH , BANGALORE . T HIS JOINT ACCOUNT WAS O PENED ONLY FOR OPERATION AL CONVENIENCE . I T IS STATED THAT THE ASSESSEE S MOTHER HAD MADE SHORT TERM CAPITAL GAIN OF RS. 2 , 24 ,3 84 / - ON REDEMPTION OF DSP MERRILL LYNCH MUTUAL FUND AND GAINS MADE ARE CREDIT ED TO JOINT ACCOUNT AND THE GAINS , IF ANY , ARE TAXABL E ONLY IN HIS MOTHER S HANDS AND NOT IN THE APPELLANT S HANDS. 5 .2 O N THE OTHER HAND , THE LEARNED DEPARTMENTAL REPRESENTATIVE PLACED R ELIANCE ON THE ORDERS OF THE LOWER AUTHORITIES . 6 . WE HEARD RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD. T HE FIRST ISSUE IN THE GROUNDS OF APPEAL RELATES TO THE ADDITION OF RS. 11 , 50 , 0 00/ - AS UNEXPLAINED INVESTMENT IN MUTUAL FUNDS . IT IS U NDISPUTED FACT THAT THESE INVESTMENTS ARE MADE OUT OF FUNDS AVAILABLE IN THE CITY BANK JOINTLY HELD BY THE ASSESSEE, WITH H ER SON AND HER HUSBAND. FROM THE MERE PERUSAL OF THE STATEMENT OF BANK ACCOUNT, IT IS CLEAR THAT INVESTMENTS IN MUTUAL FUNDS HAD BEEN MADE OUT OF THIS BANK ACCOUNT. THUS, THE S O URCE OF INVESTMENTS IS MANIFEST FROM THE PERUSAL OF STATEMENT OF ACCOUNT. T HE QUESTION , FROM WHOSE SOURCE OF INCOME ITA NO . 955 /BANG/201 6 PAGE 5 OF 5 INVESTMENT S ARE MADE IS IR RELEVANT , AS THE ADDITION CAN BE MADE IN CASE SOURCE REMAINED UNEXPLAINED. SINCE IN THE PRESENT CASE, SOURCE OF FUNDS HAVE BEEN DULY EXPLAINED, THE QUESTI O N OF ADDITION DOES NOT ARISE . T HERE F ORE, THE ADDITION MADE BY THE A SSESSING O FFICER IS DELETED . A S REGARDS THE ADDITION OF RS.2,24,384/ - ON ACCOUNT OF SHORT TERM CAPITAL GAIN CREDITED TO THE JOINT DEPOSIT ACCOUNT MAINTAINED WITH IDBI BANK, SARAKKI BRANCH, BENGALURU, ONUS LIES ON THE REVENUE TO PROVE THAT THE SOURCE OF INVESTMENT IN DSP MERRILL LYNCH MUTUAL FUND HAS GONE FROM INCOME SOURCE OF THE APPELLANT. T HE REVENUE HA D NOT DISCHARGED ON US THAT LIE UPON IT . I N THE CIRCUMSTANCES WE ARE UNABLE TO UP HOLD THE ADDITION OF RS.2,24,384/ - , WE HEREBY DELETE THE ADDITION. 7. I N THE RESULT , APPEAL FILED BY THE ASSESSEE IS ALLOWED . ORDER PRONOUNCED IN THE OPEN COURT ON 09 TH FEBRUARY , 2018 S D/ - SD/ - ( SUNIL KUMAR YADAV ) (INTURI RAMA RAO) JUDICIAL MEMBER ACCOUNTANT MEMBER PLAC E : BENGALURU. D A T E D : 09 / 0 2 /201 8 SRINIVASULU, SPS COPY TO : 1 APPELLANT 2 RESPONDENT 3 CIT(A) 4 CIT 5 DR, ITAT, BANGALORE. 6 GUARD FILE BY ORDER SENIOR PRIVATE SECRETARY INCOME - TAX APPELLATE TRIBUNAL BANGALORE