Shri Avnishkumar G. Joshi, Nadiad V. The Income Tax Officer, Ward-2, Nadiad

ITA 964/AHD/2014

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 9487 (ITAT-AHMEDABAD)
• Duration Of Justice: 1 year(s) 10 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-02-2016
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2010-2011
• Appeal Filed On: 07-04-2014
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: SANTOSH KARNAMI
• Assessee Lawyers: S P BHATT
• Keywords: Deemed to accrue or arise in india
• Section: 131

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH, AHMEDABAD BEFORE SHRI B.P. JAIN, ACCOUNTANT MEMBER ./ ITA.NO.964/AHD/2014 AND ITA NO.3072/AHD/2015 / ASSTT. YEAR: 2010-2011 JOSHI AVNISHKUMAR G C/O. D.P. MEDICAL & GENERAL STORES OPP: D.P. DESAI HIGH SCHOOL NADIAD 387 001. VS ITO, WARD-2 NADIAD 387 002. ! / (APPELLANT) '# ! / (RESPONDENT) ASSESSEE BY : SHRI S.P. BHATT, AR REVENUE BY : SHRI SANTOSH KARNAMI, SR.DR / DATE OF HEARING : 24/02/2016 / DATE OF PRONOUNCEMENT: 24/02/2016 $%/ O R D E R THESE TWO APPEALS OF THE ASSESSEE AROSE FROM TWO DI FFERENT ORDERS OF THE LD. CIT(A)-II, BARODA ONE ON ACCOUNT OF QUANT UM DATED 11.12.2013 AND ANOTHER ON ACCOUNT OF PENALTY LEVIED UNDER SECTION 271(1)(C) OF THE INCOME TAX DATED 24.08.2015 FOR THE ASSTT.YEAR 2010-2011. 2. SINCE APPEALS ARE INTER-CONNECTED, ACCORDINGLY, I TAKE BOTH THE APPEALS BY THIS CONSOLIDATED ORDER. FIRST OF ALL, I TAKE T HE QUANTUM APPEAL IN ITA NO.964/AHD/2014 WHERE THE ASSESSEE HAS RAISED THE F OLLOWING GROUNDS OF APPEAL: L. THE PETITIONER SUBMITS THAT DURING THE COURSE O F HEARING IDENTIFICATION OF THE CREDITOR WAS ESTABLISHED EXPL AINING THE ENTRY OF RS.5 LACS FOUND BY THE ID.I.T.O.IN THE COPY OF S.B. ACCOUNT WITH AXIS ITA NO.964/AHD/2014 AND 3072/AHD/2015 2 BANK IN THE NAME OF KADAMKUMAR -K. PATEL. SUMMONS U /S.131 WAS ISSUED TO THE PARTY WHOSE STATEMENT WAS RECORDED. F OR THE REASONS NOT KNOWN TO THE PETITIONER THE SAID AMOUNT WAS ADDED T O THE BOOK RESULT BY THE LD.I.T.0. AND UPHELD BY THE LD.C.I.T,(A)II,B ARODA IN FIRST APPEAL. 2. THE SAID ENTRY IN THE BANK ACCOUNT WAS LOAN ARRA NGED FROM THE LENDER ELDER BROTHER OF SHRI K.K.PATEL VIZ.JATINBHA I KANTIBHAI PATEL CLOSE FRIEND OF THE PETITIONER WHO HAS BEEN SETTLED IN LONDON. THE SAID AMOUNT OF RS.5 LAC WAS DEPOSITED IN THE BANK ACCOUN T BUT SIMULTANEOUSLY AS DESIRED BY THE BED-RIDDEN FATHER THE AMOUNT WAS WITHDRAWN AND PAID TO THE LENDER SHRI K.K.PATEL. 3. THE PETITIONER ESTABLISHED IDENTIFICATION OF THE CREDITOR TO SHOW THAT THE ENTRY WAS NOT FICTITIOUS AND THERE WAS NO MORE POSSESSION OVER THE MONEYS IT IS STILL NOT UNDERSTOOD AS TO WHY THE SAM E IS BEING LOOKED IN THE NATURE OF OWNERSHIP OF THE PETITIONER AND MADE APPLICATION OF SECTION 69-A BRINGING INTO THE NET OF TAXATION IN T HE FORM OF 'DEEMED INCOME WHEN ANY BENEFIT / EARNING AROSE TO THE PET ITIONER. THE LD.C.I.T.(A) BARODA HAS DECIDED THE APPEAL UPHOLDIN G THE ADDITION BUT REASONS FOR DECISION ALONG WITH POINTS FOR DETERMIN ATION ARE NOT STATED THEREIN. 4. THE OBJECTIVE TO ARRANGE FOR LOAN WAS THE ANTICI PATED PAYMENTS TO LABOURERS ETC. WHEN THE CONSTRUCTION WORK WAS UNDER PROGRESS AND UNDERTAKEN BY FATHER GUNVANTBHAI -FATHER OF THE PET ITIONER WHO WAS RETIRED EMPLOYEE OF THE STATE GOVT. OF CADRE-I HAVI NG ADVANCE AGE. THE PETITIONER EXPLAINED THE NEED OF LOAN AND THE M ANNER IN WHICH THE LOAN AMOUNT WAS NECESSARY FOR CONSTRUCTION OF RESID ENTIAL HOUSE IN PROGRESS, AFTER RETIREMENT, ON SUPERANNUATION. 5. THE ONLY GROUND FOR ADDITION THAT CASH WAS DEPOS ITED AND BORROWED AMOUNT WAS RETURNED ON THE SAME DAY BY SIMULTANEOUS WITHDRAWAL COULD CREATE A SUSPICION BUT NOT PROOF. VIDE PLEASE C.I.T. VS DAULATRAM RAWATMAL 87 ITR 349(SC). 6. THE PETITIONER WAS THEREFORE NOT THE PERSON IN W HOSE POSSESSION THE MONEYS, WERE FOUND IN. THE STATEMENT OF BANK ACCOUN T NOR HOLDING OWNERSHIP OF THE SAID MONEYS OF RS.5 LACS DEPOSITED & WITHDRAWN SIMULTANEOUSLY SO THAT THE ADDITION SO MADE IN THE FORM OF DEEMED INCOME U/S.69-A CONFIRMED IN FIRST APPEAL SHOULD BE DELETED AND JUSTICE BE DONE ON THAT SCORE. ITA NO.964/AHD/2014 AND 3072/AHD/2015 3 3. THE BRIEF FACTS AS EMANATING FROM THE ORDER OF T HE AO ARE REPRODUCED BELOW: 5. FURTHER, AS PER COPY OF BANK ACCOUNT OF AXIS BANK HAVING ACCOUNT NO.446010100108805 FOR THE PERIOD FROM 01/0 4/2009 TO 31/03/2010, IT IS NOTICED THAT THE ASSESSEE HAS REC EIVED RS.5,00,000/- AS ON 07/09/2009 FROM KADAMKUMAR K. PATEL. THE STATEME NT U/S.131 OF THE ACT WAS RECORDED ON 12/10/2012 OF SHRI KADAMKUM AR K. PATEL OF KERIAVL TA. NADIAD (PAN:ATOPP3980R). WHO IS RIOT, F ILING RETURN OF INCOME SINCE HE DO NOT HAVE TAXABLE INCOME. (REPLY TO Q.NO.3). AS PER REPLY TO Q.NO.5, HE STATED THAT HE HAS PAID RS.3,00 ,000/- THROUGH CHEQUE OF AXIS BANK HOWEVER NO SUCH ENTRY IS FOUND IN THE BANK STATEMENT OF AXIS BANK SUBMITTED BY SHRI KADAMKUMAR K. PATEL, (A/C. NO.297010100039914). FURTHER, IN REPLY TO Q.NO.4, H E STATED THAT HE HAVING A BANK ACCOUNT IN IDBI BANK OF NADIAD AND BA NK OF BARODA OF KERIAVI. IN REPLY TO Q. NO.8, HE STATED THAT HE HAS PAID RS.3,00,000/- TO SHRI AVNISH JOSHI I.E. THE ASSESSEE ON BEHALF OF TH E BROTHER OF SHRI KADAMKUMAR NAMELY SHRI JATINBHAI K. PATEL. HOWEVER SHRI KADAMKUMAR K. PATEL HAS NOT FURNISHED ANY SUPPORTIN G DOCUMENTARY EVIDENCES IN THIS REGARD. 5.1 NOW, IT IS SEEN THAT, THE ASSESSEE CLAIMED THAT AMOUNT OF RS.5,00,000/-RECEIVED ON 07/09/2009 FROM SHRI KADAM KUMAR K. PATEL IS NOT FOUND GENUINE ON THE FACTS THAT SHRI KADAMKU MAR HAS NO CREDITWORTHYNESS AND DO NOT SHOWING PAYMENT OF RS.3 ,00,000/- FROM THE BANK ACCOUNT FURNISHED OF AXIS BANK. UNDER SUCH CIRCUMSTANCES, THE AMOUNT OF RS.5,00,000/- CREDITED IN BANK ACCOUN T AS ON 07/09/2009 IS NOT TREATED AS RECEIVED FROM SHRI KADAMKUMAR K. PATEL AND IT IS ALSO NOT FOUND GENUINE TRANSACTION AND THEREFORE THE SAM E IS TREATED AS INCOME OF THE ASSESSEE AS PROVIDED IN THE PROVISION OF SECTION 69A OF THE IT ACT, 1951. PENAL ACTION U/S.271(L)(C) ARE IN ITIATED ON ACCOUNT OF INACCURATE PARTICULARS OF SUCH INCOME HAVE BEEN FUR NISHED. 4. THE LD.CIT(A) CONFIRMED THE ACTION OF THE AO. 5. THE LD.COUNSEL FOR THE ASSESSEE REITERATED THE S UBMISSIONS, AS SUBMITTED BEFORE BOTH THE AUTHORITIES BELOW, WHEREAS, THE LD. DR RELIED UPON THE ORDERS OF THE LOWER AUTHORITIES. ITA NO.964/AHD/2014 AND 3072/AHD/2015 4 6. I HAVE HEARD RIVAL CONTENTIONS AND PERUSED THE F ACTS OF THE CASE. IT HAS BEEN CLAIMED THAT THE ASSESSEE HAS RECEIVED RS.5.00 LAKHS ON 7.9.2009 FROM SHRI KADAMKUMAR K. PATEL (KKP FOR SHORT). ACCORD INGLY, A STATEMENT UNDER SECTION 131 OF THE ACT WAS RECORDED ON 12.10. 2012 OF KKP. IT WAS STATED BY HIM THAT HE IS NOT FILING ANY RETURN OF I NCOME AND HE HAS PAID RS.3.00 LAKHS THROUGH ACCOUNT PAYEE CHEQUE OF AXIS BANK. THE AO, HOWEVER, ON VERIFICATION FOUND FROM THE BANK STATEM ENT OF AXIS BANK SUBMITTED BY KKP (ACCOUNT NO.297010100039914) THAT NO SUCH ENTRY OF PAYMENT OF RS.3.00LAKHS TO THE ASSESSEE IS APPEARIN G IN THE BANK STATEMENT. KKP ALSO STATED THAT HE IS HAVING BANK ACCOUNT IN I DBI BANK, AND IN QUESTION NO.8, HE HAS STATED THAT HE HAS PAID RS.3.00 LAKHS TO THE ASSESSEE ON BEHALF OF HIS BROTHER, BUT NO SUPPORTING DOCUMENTARY EVIDENCE S IN THIS REGARD HAS BEEN SUBMITTED. A PERUSAL OF THE STATMENT OF KKP AVAILA BLE IN APPEAL PAPERS AT PAGE NO.20 AND 21, AS REPLY TO QUESTION NO.3, IT WA S STATED THAT HE IS RESIDING WITH THE JOINT FAMILY AND DOES NOT HAVE ANY INCOME AND AT PRESENT HE IS STUDYING. ON THE OTHER HAND, REPLY TO QUESTION NO. 4, HE HAS STATED THAT HE IS HAVING A BANK ACCOUNT WITH IDBI AND BANK OF BARODA AND HOLDING SALARY ACCOUNT WITH AXIS BANK AND DOES NOT HAVE ANY OTHER BANK ACCOUNT. FROM THE PERUSAL OF THE EIGHT ANSWERS TO THE QUESTIONS FROM THE STATEMENT AT PAGE NO.20 AND 21 MENTIONED HEREINABOVE, IT IS EVIDENT THAT KK P IS NOT HAVING ANY AMOUNT AVAILABLE TO THE EXTENT OF RS.3.00 LAKHS OR RS.5.00 LAKHS FOR GIVING LOAN TO THE ASSESSEE, AND ALSO HE HAS NOT PRODUCED ANY DOCUMENTARY EVIDENCES IN THIS REGARD FOR AVAILABILITY OF FUNDS WITH HIM F OR GIVING LOAN TO THE ASSESSEE. IN THE CIRCUMSTANCES AND FACTS OF THE CASE, I AM OF THE VIEW THAT THE SAID AMOUNT OF RS.5 LAKHS RECEIVED BY THE ASSESSEE STATE D TO HAVE BEEN RECEIVED FROM KKP IS FALSE STATEMENT AND APPEARS TO BE HIS O WN MONEY ROUTED THROUGH KKP, AND THEREFORE, IN THE CIRCUMSTANCES AND FACTS OF THE CASE, I FIND NO ITA NO.964/AHD/2014 AND 3072/AHD/2015 5 INFIRMITY ON THE ORDER OF THE LD.CIT(A) IN CONFIRMI NG THE ACTION OF THE AO. IT IS CONFIRMED. ALL THE GROUNDS OF THE APPEAL OF THE ASSESSEE ARE DISMISSED. 7. IN THE RESULT, APPEAL OF THE ASSESSEE IN ITA NO. 964/AHD/2014 IS DISMISSED. ITA NO.3072/AHD/2015 (PENALTY UNDER SECTION 271(1)( C) OF THE ACT) 8. THE ASSESSEE HAS RAISED AS MANY AS TEN GROUNDS O F APPEAL, BUT ONLY ONE ISSUE IS, AS STATED BY THE LD.AR APPEARED BEFORE ME , IS AGAINST THE CONFIRMATION OF LEVY OF PENALTY UNDER SECTION 271(1 )(C) OF THE ACT. 9. THE FACTS IN THE PRESENT CASE ARE, AS STATED IN THE QUANTUM APPEAL HEREINABOVE, WHICH HAS BEEN CONFIRMED BY ME, AND TH E ASSESSEE HAS NOT SUBMITTED ANY EXPLANATION OR DOCUMENTARY EVIDENCE, AS HAVING RECEIVED MONEY FROM KKP, AND THEREFORE, IT IS A CASE OF FURN ISHING OF INACCURATE PARTICULARS OF INCOME. ACCORDINGLY, THE AO HAS RI GHTLY LEVIED PENALTY, WHICH HAS RIGHTLY BEEN CONFIRMED TO THE EXTENT OF RS.1,50 ,000/- BY THE LD.CIT(A), AND WE FIND NO INFIRMITY IN THE ORDER OF THE LD.CIT (A). THUS, ALL THE GROUNDS OF APPEAL OF THE ASSESSEE ARE DISMISSED. 10. IN THE RESULT, APPEALS OF THE ASSESSEE, BEING I TA NO.964/AHD/2014 AND ITA NO.3072/AHD/2015, BOTH ARE DISMISSED. ORDER PRONOUNCED IN THE COURT ON 24 TH FEBRUARY, 2016 AT AHMEDABAD. SD/- ( B.P. JAIN ) ACCOUNTANT MEMBER AHMEDABAD; DATED 24/02/2016