Dr. Akilan Ramnathan, CHENNAI V. ACIT, CHENNAI

ITA 967/CHNY/2016

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 8487 (ITAT-CHENNAI)
• Duration Of Justice: 5 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-09-2016
• Appeal Filed By: Assessee
• Bench Allotted: A
• Assessment Year: 2009-2010
• Appeal Filed On: 15-04-2016
• Court: TRIBUNAL
• Department Lawyers: SHIVA SRINIVAS
• Assessee Lawyers: M P SENTHIL KUMAR
• Keywords: Reopening of assessment; Unexplained cash credit; Gift; Salary income; Charitable institution; Corroborative evidences
• Section: 148

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH : CHENNAI . , ! . # , $ % & [ BEFORE SHRI ABRAHAM P. GEORGE, ACCOUNTANT MEMBER AND SHRI G. PAVAN KUMAR, JUDICIAL MEMBER ] ./ I.T.A.NOS.967 TO 969/MDS/2016 / ASSESSMENT YEARS : 2009-10, 2010-11 AND 2011- 12 DR. AKILAN RAMANATHAN, #9, STATE BANK COLONY SHASTRI NAGAR ADYAR, CHENNAI 600 020 VS. THE ASSTT. COMMISSIONER OF INCOME-TAX NON-CORPORATE CIRCLE 15(1) CHENNAI [PAN ACQPA 2957 G] ( '( / APPELLANT) ( )*'( /RESPONDENT) / APPELLANT BY : SHRI PHILIP GEORGE, ADVOCATE & SHRI M.P.SENTHIL KUMAR, ADVOCATE /RESPONDENT BY : SHRI SHIVA SRINIVAS, JCIT / DATE OF HEARING : 17 - 08 - 2016 ! / DATE OF PRONOUNCEMENT : 16 - 09 - 2016 + / O R D E R PER ABRAHAM P. GEORGE, ACCOUNTANT MEMBER THESE APPEALS OF THE ASSESSEE ARE DIRECTED AGAIN ST SEPARATE ORDERS DATED 11.03.2016 OF THE COMMISSION ER OF INCOME-TAX (APPEALS)-15, CHENNAI, FOR ASSESSMENT YEARS 2009-10, 2010-11 AND 2011-12. 2. FIRST WE TAKE UP I.T.A.NO.967/MDS/2016 FOR ASSESSME NT YEAR 2009-10. ITA NO. 967 TO 969/16 :- 2 -: 3. LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT HE WAS NOT PRESSING GROUND NUMBER 2 CHALLENGING THE REOPENING. HENCE, GROUND NO.2 IS DISMISSED AS NOT PRESSED. 4. IN ITS GROUND NO.3, ASSESSEE ASSAILS AN ADDITION OF ` 17,50,000/- MADE U/S.68 OF THE INCOME TAX ACT, 1961 ( IN SHORT THE ACT ). 5. FACTS APROPOS ARE THAT THE ASSESSEE, HOLDING A DOC TORATE DEGREE FROM ANNA UNIVERSITY, CHENNAI, WAS IN CIVIL SERVICE SINCE 1997. HE RESIGNED FROM SUCH SERVICE IN JUNE 2005 AND THER EAFTER WORKED AS PRO-CHANCELLOR, BHARATH UNIVERSITY, CHENNAI FROM JU LY 2005 TO JUNE 2009. AFTER THIS TENURE, HE WORKED AS ADVISOR TO MA HATMA GANDHI MEDICAL COLLEGE FROM AUGUST 2005 TO NOVEMBER 2010. THEREAFTER HE WORKED AS CONSULTANT IN ONE M/S INFO PLUS PVT. LTD FROM APRIL 2010 TO MARCH, 2011. ASSESSEE WAS RECEIVING SALARY, CONSUL TANCY FEES ON RETAINERSHIP SERVICES AND INCOME FROM OTHER SOURCES . 6. FOR THE IMPUGNED ASSESSMENT YEAR, ASSESSEE FILED R ETURN OF INCOME DECLARING INCOME OF ` 26,34,200/-. ASSESSMENT WAS REOPENED BY ISSUING NOTICE U/S 148 OF THE ACT. IN PURSUANC E OF THE NOTICE, THE ASSESSEE REQUESTED THE ASSESSING OFFICER TO TREAT T HE RETURN ORIGINALLY FILED AS THE ONE FILED IN RESPONSE TO THAT NOTICE. DURING THE COURSE OF ASSESSMENT, IT WAS NOTICED BY THE ASSESSING OFFICER THAT THE ASSESSEE ITA NO. 967 TO 969/16 :- 3 -: HAD DEPOSITS IN A SAVINGS BANK ACCOUNT WITH INDIAN OVERSEAS BANK (I.O.B), ADYAR BRANCH TOTALING TO ` 17,52,000/-. THE EXPLANATION OF THE ASSESSEE WAS SOUGHT. THE SUBMISSION OF ASSESSEE WAS THAT THE DEPOSITS WERE MADE OUT OF WITHDRAWALS TOTALING ` 28,02,918/- MADE FROM HIS ACCOUNT WITH INDIAN BANK M.G.ROAD, PONDICH ERRY AS WELL AS AN ACCOUNT WITH INDIAN OVERSEAS BANK. THE AO WAS OF THE OPINION THAT ASSESSEE HAD NOT MAINTAINED ANY CASH BOOK AND THERE WAS A CONSIDERABLE GAP BETWEEN THE DATE OF WITHDRAWALS AN D THE DATE OF DEPOSITS. AS PER AO, ASSESSEE COULD NOT SHOW ANY EV IDENCE OR REASON KEEPING SIGNIFICANT AMOUNT OF CASH WITH HIM FOR A L ONG PERIOD. AN ADDITION OF ` 17,50,000/- WAS MADE U/S 68 OF THE ACT. 7. AGGRIEVED, ASSESSEE MOVED IN APPEAL BEFORE THE CIT( A). APART FROM CHALLENGING THE REOPENING OF ASSESSMENT, ON MERITS, IT WAS SUBMITTED BY THE ASSESSEE THAT THE DEPOSITS HAD CO ME OUT OF THE WITHDRAWAL FROM HIS OWN BANK ACCOUNT IN THE VER Y SAME BANK AS WELL AS AN ACCOUNT WITH I.O.B., PONDICHERRY BRANCH. ASSESSEE ALSO SUBMITTED BEFORE THE LD.CIT(A) THAT HE WAS NOT OBLI GED TO MAINTAIN ANY BOOKS OF ACCOUNTS SINCE SEC.44AA WAS NOT APPLIC ABLE TO HIM. AS PER ASSESSEE, HE WAS ONLY RECEIVING INCOME FROM SAL ARY AND CONSULTANCY FEES ON A RETAINER-SHIP BASIS. ACCORDI NG TO ASSESSEE, RULE 6F OF INCOME TAX RULES, 1962 WAS NOT APPLICABLE TO HIM. ITA NO. 967 TO 969/16 :- 4 -: 8. THE CIT(A) SOUGHT REMAND REPORT FROM THE ASSESSING OFFICER. IN THE REMAND REPORT THE ASSESSING OFFICER STATED T HAT EVIDENCE FURNISHED BY THE ASSESSEE WAS NOT SATISFACTORY. BA SED ON THIS REPORT, THE ADDITION WAS CONFIRMED BY THE CIT(A). 9. NOW, BEFORE US, THE LD.AR, STRONGLY ASSAILING THE O RDERS OF THE LOWER AUTHORITIES, SUBMITTED THAT COPY OF THE I.O.B BANK ACCOUNT PLACED AT PAGE 30 OF THE PAPER BOOK REFLECTED THE F OLLOWING DEPOSITS:- DATE AM OUNT DEPOSITED 03.04.2008 2,000/ - 28.05.2008 3,00,000/ - 02.06.2008 1,00,000/ - 09.09.2008 1,00,000/ - 29.09.2008 1,00,000/ - 06 . 1 0.2008 5,00,000/ - 07.10 .2008 2,00,000/ - 11.11 .2008 50,000/ - 02.12 .2008 1,00,000/ - 07.01.2009 50,000/ - 09.01.20 09 50,000/ - 21.01.2009 5,000/ - 09.02.2009 2,00,000/ - TOTAL 17,57,000/ - ITA NO. 967 TO 969/16 :- 5 -: 10. AS PER THE LD. AR, OUT OF THE ABOVE DEPOSITS, THE FOLLOWING ONES WERE EXPLAINED BY AMOUNTS WITHDRAWN ON EARLIER DATES FROM VARIOUS BANK ACCOUNTS HELD BY THE ASSESSEE AND OPE NING CASH BALANCE HELD: BANK DATE AMOUNTS DEPOSITED AMOUNT WITHDRAWN IN RS. OPENING BALANCE 0 1.04.200 8 4,86,141 / - IOB, ADYAR 02.04.2008 3,2 0,000/ - IOB, ADYAR 03.04.2008 2,000/ - INDIAN BANK PUDUCHERRY 03.04.2008 1,8 0,000/ - INDIAN BANK PUDUCHERRY 16.04.2008 1,80,000 / - IOB, ADYAR 28.05.2008 3,00,000/ - 14,64,343/ - IOB, ADYAR 02.06.2008 1,00,000/ - TOTAL 4,02,000/ - 11,66,141/ - BANK DATE AMOUNTS DEPOSITED AMOUNT WITHDRAWN IN RS. IOB, ADYAR 09.06.2008 2,00,000/ - IOB, ADYAR 14.06.2 008 1,00,000/ - INDIAN BANK PUDUCHERRY 02.07.2008 2,0 0,000/ - IOB, ADYAR 16.07.2008 2,0 0,000/ - IOB, ADYAR 09.09.2008 1,00,000/ - IOB, ADYAR 29.09.2008 1,00,000/ - IOB, ADYAR 06.10.2008 5,00,000/ - TOTAL 7,00,000/ - 7,00,000/ - THESE ACCORDING TO LD.A.R, WOULD EXPLAIN THE DEPOSI TS MADE BY THE ASSESSEE DURING THE PERIOD 03.04.2008 TO 06.10.2008 . AS PER LD.A.R, THE DEPOSITS OF ` 2 LAKHS ON 07.10.2008 CAME OUT OF A GIFT OF ` 2 LAKHS RECEIVED FROM ASSESSEES CO-BROTHER SHRI SUDAMANI. LD.A.R SUBMITTED THAT SHRI SUDAMANI WAS WORKING AS AN ENGINEER IN A MULTI-NATIONAL ITA NO. 967 TO 969/16 :- 6 -: COMPANY AND ASSESSEE HAD RECEIVED A SUM OF ` 2 LAKHS AS A GIFT FOR TAKING CARE OF THE PARENTS OF SHRI SUDAMANI, WHEN T HEY HAD VISITED CHENNAI FOR MEDICAL TREATMENT. 11. CONTINUING HIS ARGUMENTS, LD.A.R SUBMITTED THA T THE FOLLOWING DEPOSITS WERE MADE OUT OF AGRICULTURAL IN COME OF ` 2.5 LAKHS RETURNED BY THE ASSESSEE. BANK DATE AMOUNTS DEPOSITED IOB, ADYAR 11.11.2009 50,000/ - IOB, ADYAR 02.12.2009 1,00,000/ - IOB, ADYAR 07.01.2009 50,000/ - IOB, ADYAR 09.01.2009 50,000/ - / - TOTAL 2,50,000/ - LD.A.R SUBMITTED THAT DEPOSITS OF ` 5,000/- ON 21.01.2009 AND ` 2 LAKHS HAD COME OUT OF WITHDRAWALS OF ` 3,05,000/- ON 21.01.2009 FROM THE ACCOUNT WITH INDIAN BANK, PUDUCHERRY. AS PER T HE LD.A.R, THE CREDITS IN THE ASSESSEES ACCOUNT WITH INDIAN BANK, PUDUCHERRY WAS HIS SALARY. THUS, ACCORDING TO HIM, THE DEPOSITS IN THE BANK STOOD EXPLAINED. 12. PER CONTRA, LD.D.R SUBMITTED THAT ASSESSEE NOT BEING IN ANY LINE OF BUSINESS HAD NO REASON TO WITHDRAW MONEY A ND KEEP IT WITH HIM AS CASH. ACCORDING TO HIM, IT WAS NOT PROBABLE THAT A SALARIED EMPLOYEE WOULD KEEP SUBSTANTIAL SUMS AS CASH IN HIS HOUSE. THUS ACCORDING TO HIM, THE VERSION GIVEN BY THE ASSESSEE WAS UNBELIEVABLE. ITA NO. 967 TO 969/16 :- 7 -: 13. WE HAVE CONSIDERED THE RIVAL CONTENTIONS AND P ERUSED THE ORDERS OF THE AUTHORITIES BELOW. THE WITHDRAWALS C LAIMED BY THE ASSESSEE ARE FROM HIS ACCOUNTS WITH IOB, ADYAR BRAN CH AND INDIAN BANK PUDUCHERRY. THESE WITHDRAWALS ARE CLEARLY REFL ECTED IN THE BANK ACCOUNT STATEMENTS, COPY OF WHICH IS FILED AT PAGES 2 TO 12. A LOOK AT THE DATES OF THE WITHDRAWALS AND DATES OF DEPOSITS CAPTURED BY US IN PARA NOS.9 & 10 OF THIS ORDER WOULD CLEARLY SHOW TH AT THE TIME GAP OF BETWEEN WITHDRAWALS AND THE DEPOSITS WERE NOT MORE THAN FOUR MONTHS AT THE MOST. ASSESSEE HAD STATED THAT HE WAS CONTEMPLATING PURCHASE OF A PIECE OF LAND AND ON 19.05.2008, AND ASSESSEE HAD INDEED PURCHASED A PROPERTY AT TIRUVIDANNAI VILLAG E, KANCHEEPURAM DISTRICT. JUST BECAUSE THE ASSESSEE WAS A SALARIED EMPLOYEE, WE CANNOT SAY THAT ASSESSEE SHOULD NOT HAVE KEPT MONEY AT HIS HOME, IF HE HAD AN INTENTION TO PURCHASE A LAND WHICH HE FOU ND SUITABLE. COMING TO THE CASH DEPOSIT OF ` 2 LAKHS FOR WHICH ASSESSEE HAS SHOWN THE SOURCE AS A GIFT FROM CO-BROTHER, SRI SUDAMANI, CONFIRMATION FROM MR.SUDAMANI IS AVAILABLE AT PAGE-13 OF PAPER BOOK. THE SAID CONFIRMATION GAVE MR.SUDAMANIS PAN AND ALSO HIS A DDRESS IN DUBAI. COPY OF THE RETURN OF INCOME FILED BY MR.SUDAMANI F OR ASSESSMENT YEAR 2008-09 IS AVAILABLE AT PAGE-14 OF PAPER BOOK AND IT REFLECTS A TOTAL INCOME OF ` 10,94,500/-. IN OUR OPINION, ASSESSEE HAD SHOWN THE GENUINENESS OF THE GIFT AND ALSO THE CREDIT WORTHIN ESS OF THE DONOR. ITA NO. 967 TO 969/16 :- 8 -: 14. COMING TO THE CLAIM OF DEPOSITS OF ` 2.5 LAKHS MADE OUT OF AGRICULTURAL INCOME, THE AO HIMSELF HAS IN THE ASSE SSMENT ORDER ACCEPTED AN AGRICULTURAL INCOME OF ` 3,13,800/-. THE DEPOSITS CLAIMED BY THE ASSESSEE OUT OF AGRICULTURAL INCOME WERE ONL Y ` 2.5 LAKHS. 15. ASSESSEE IN OUR OPINION IS NOT OBLIGED TO MAI NTAIN BOOKS OF ACCOUNTS, SINCE SEC.44AA IS APPLICABLE ONLY TO PERS ONS CARRYING ON BUSINESS OR PROFESSION. WE ARE OF THE OPINION THAT THE ASSESSEE HAD DONE ALL WHAT HE WAS EXPECTED TO DO TO PROVE THE SO URCE OF THE DEPOSITS IN THE BANK ACCOUNTS. THE ADDITION STANDS DELETED. GROUND NO.3 OF ASSESSEE IS ALLOWED. 16. VIDE ITS GROUND NO.4, GRIEVANCE RAISED BY THE ASSESSEE IS THAT A GIFT OF ` 2 LAKHS RECEIVED FROM SHRI SUDAMANI WAS DISBELIEVE D AND AN ADDITION OF THE SAID AMOUNT WAS MADE. 17. IN RELATION TO GROUND NO.3 OF THE ASSESSEE WHE REIN HE ASSAILED THE ADDITION OF ` 17,50,000/- U/S.68 OF THE ACT, WE HAVE ALREADY HELD AT PARA NO.13 OF THIS ORDER THAT ASSE SSEE HAD SUBSTANTIATED THE CLAIM OF GIFT FROM SHRI SUDAMANI. ACCORDINGLY, WE DELETE THE ADDITION OF ` 2 LAKHS. GROUND NO.4 OF ASSESSEE STANDS ALLOWED. ITA NO. 967 TO 969/16 :- 9 -: 18. VIDE ITS GROUND NO.5, GRIEVANCE RAISED BY THE ASSESSEE IS THAT AN UNSECURED LOAN OF ` 15 LAKHS OBTAINED FROM ONE BALAJI EDUCATIONAL TRUST WAS DISBELIEVED AND ADDED. 19. LD.A.R SUBMITTED THAT FOR THE LOAN OF ` 15 LAKHS, ASSESSEE HAD PRODUCED CONFIRMATION LETTER FROM BALAJI EDUCA TION AND CHARITABLE PUBLIC TRUST WHICH GAVE ITS PAN AND ADDRESS. AS PE R LD.A.R, THE LEDGER ACCOUNT OF ASSESSEE IN THE BOOKS OF SAID TRUST SIGN ED BY THEIR AUTHORIZING SIGNATORY WAS ALSO PRODUCED BEFORE THE LOWER AUTHORITIES. DESPITE THIS, ACCORDING TO HIM, THE CLAIM OF ASSESS EE WAS DISALLOWED. 20. PER CONTRA, LD.D.R SUPPORTED THE ORDERS OF LOW ER AUTHORITIES. 21. WE HAVE CONSIDERED THE RIVAL CONTENTIONS AND P ERUSED THE ORDERS OF THE AUTHORITIES BELOW. WE HAVE PERUSED T HAT THE EVIDENCE PRODUCED BY THE ASSESSE, WHICH IS A CONFIRMATION F ROM BALAJI EDUCATIONAL TRUST, COPY OF WHICH IS PLACED AT PAGE- 20 OF PAPER BOOK. WE HAVE ALSO SEEN THE LEDGER COPY OF THE ASSESSEE I N THE BOOKS OF THE SAID TRUST PLACED AT PAGE-21 OF PAPER BOOK. LD.CIT( A) HAD SOUGHT A REMAND REPORT FROM THE AO ON THESE. LD.CIT(A) HAS HIMSELF STATED THAT IN THE REMAND REPORT, THE AO HAS SIMPLY MENTIO NED THE EVIDENCE TO BE NOT SATISFACTORY. THE REASON WHY THE EVIDENC E WAS NOT CONSIDERED SATISFACTORY WAS NEVER SPELT OUT BY AO. ASSESSEE HAD PRODUCED CONFIRMATION LETTER GIVING ALL THE DETAILS OF CREDITOR. CREDITOR BEING A CHARITABLE TRUST WOULD HAVE BEEN SUBJECT T O ASSESSMENT UNDER ITA NO. 967 TO 969/16 :- 10 - : INCOME TAX ACT,1961. IN SUCH SITUATION, WE ARE OF T HE OPINION THAT TO REJECT THE CLAIM OF THE LOAN WAS UNJUST. ASSESSEE H AD PRODUCED WHAT ALL WAS NECESSARY TO PROVE THE CREDIT. THE ADDITIO N OF ` 15 LAKHS STANDS DELETED. GROUND NO.5 OF THE ASSESSEE IS ALLO WED. 22. VIDE ITS GROUND NO.6, GRIEVANCE RAISED BY THE ASSESSEE IS ON AN ADDITION OF ` 2,26,600/- MADE BY THE AO FOR DIFFERENCE IN SALARY INCOME. 23. THE LD.A.R ASSAILING THE ABOVE ADDITION SUBMIT TED THAT THE PROFESSIONAL FEE RECEIVED BY THE ASSESSEE FROM M/S. BHARATH UNIVERSITY WAS ` 20 LAKHS AND THE RETURNED INCOME REFLECTED THE SAID AMOUNT. HOWEVER, ACCORDING TO HIM, THE TDS CERTIFICATE ISSU ED BY THE SAID UNIVERSITY REFLECTED A SUM OF ` 2,26,600/-. AS PER THE LD.A.R, THE ADDITIONS MADE BY THE AO WERE BASED ON CASH FLOW ST ATEMENT WHEREIN ASSESSEE HAD SHOWN TDS AS AN OUTFLOW. ACCORDING TO HIM, THE ADDITION WAS NOT JUSTIFIED. 24. PER CONTRA, LD.D.R SUPPORTED THE ORDERS OF AUT HORITIES BELOW. 25. WE HAVE CONSIDERED THE RIVAL CONTENTIONS AND PE RUSED THE ORDERS OF THE AUTHORITIES BELOW. IT IS NOT DISPUTE D THAT REMUNERATION RECEIVED FROM BHARATH UNIVERSITY WAS ` 22,26,600/-. MAY BE IT IS TRUE THAT ` 2,26,600/- WAS TDS. HOWEVER, ASSESSEE OUGHT HAVE RE TURNED THE GROSS AMOUNT AS HIS INCOME FROM SALARY AND NOT TH E NET AMOUNT. THE ITA NO. 967 TO 969/16 :- 11 - : ADDITION WAS THEREFORE JUSTIFIED. WE DO NOT FIND AN Y REASON TO INTERFERE WITH THE ORDER OF LD.CIT(A). GROUND NUMBER 6 IS DI SMISSED. 26. VIDE ITS GROUND NO.7, GRIEVANCE RAISED BY THE ASSESSEE IS ON SUSTENANCE OF AN ADDITION OF ` 8,11,500/- OUT OF 13,30,877/- CLAIMED AS AGRICULTURAL INCOME. 27. LD.A.R SUBMITTED THAT THE ASSESSEE WAS HOLDIN G 20.92 ACRES OF AGRICULTURAL LAND, AND HAD CULTIVATED WATER MELO N, KOREAN GRASS AND BLACK GRAM(URID DHAL). ACCORDING TO HIM, GROSS AGR ICULTURAL INCOME CAME TO ` 13,30,877/-. THE LD.A.R SUBMITTED THAT AGRICULTURAL ACTIVITY WAS PROVED BY THE DETAILED WORKINGS PROVIDED BY THE ASSESSEE, WHICH WAS UNREASONABLY REJECTED. ACCORDING TO HIM, THE AO MADE AN ESTIMATE OF ` 15,000/- AS AGRICULTURAL INCOME PER ACRE AND FOR 20 .92 ACRES HAD ARRIVED AT AN AGRICULTURAL INCOME OF ` 3,13,800/-. AS PER LD.A.R, THE AO HAD MADE AN ADDITION OF ` 10,17,077/- UNREASONABLY REJECTING THE CLAIM OF ASSESSEE. LD.A.R POINTED OUT THAT CIT(A) HAD ON ASSESSEES APPEAL RESTRICTED THE ADDITION TO ` 8,11,500/-, SINCE THE ASSESSEE HAD SHOWN ONLY THE SAID AMOUNT AS INFLOW F ROM AGRICULTURAL OPERATIONS IN THE CASH FLOW STATEMENT. ACCORDING TO HIM, THE CLAIM OF ASSESSEE OUGHT TO HAVE BEEN ALLOWED IN FULL, SINCE HE HAD SUBSTANTIAL AGRICULTURAL HOLDING. ITA NO. 967 TO 969/16 :- 12 - : 28. PER CONTRA, LD.D.R STRONGLY SUPPORTING THE ORD ERS OF LOWER AUTHORITIES SUBMITTED THAT ASSESSEE COULD NOT SHOW ANY EVIDENCE FOR THE EARNING OF AGRICULTURAL INCOME. THEREFORE, ACC ORDING TO HIM, THE CLAIM WAS CORRECTLY RESTRICTED BY THE LOWER AUTHORI TIES. 29. WE HAVE CONSIDERED THE RIVAL CONTENTIONS AND P ERUSED THE ORDERS OF THE AUTHORITIES BELOW. THE NET INCOME E STIMATED BY THE AO FROM AGRICULTURAL ACTIVITY WAS ` 15,000/- PER ACRE. AS AGAINST THIS, ASSESSEE HAD SHOWN A NET INCOME OF ` 63,575/- PER ACRE. IN OUR OPINION, ONCE IT IS ACCEPTED THAT THE ASSESSEE WAS DOING AGRICULTURAL OPERATIONS, THEN THE ESTIMATE OUGHT TO HAVE BEEN MA DE IN A REASONABLE MANNER. WE ARE OF THE OPINION THAT ASSES SEE COULD HAVE EARNED A SUM OF ` 25,000/- PER ACRE AS AN AGRICULTURAL INCOME. AT TH E SAID RATE, THE AGRICULTURAL INCOME OF ASSESSEE FROM 20.92 ACRES WOULD COME TO ` 5,23,000/-. SINCE THE ASSESSEE HAD SHOWN ONLY ` 8,11,500/- AS INFLOW FROM AGRICULTURAL OPERATIONS IN HIS CASH FLOW STATEMENT, THE ADDITION UNDER THIS HEAD HAS TO BE RESTRICTED TO ` 2,88,500/-. ORDERED ACCORDINGLY. GROUND NO.7 IS TREATED AS PARTLY ALL OWED. 30. IN THE RESULT, THE APPEAL OF ASSESSEE FOR ASSE SSMENT YEAR 2009-10 IS PARTLY ALLOWED. ITA NO. 967 TO 969/16 :- 13 - : 31. IN THE APPEAL FOR ASSESSMENT YEAR 2010-11 IN I. T.A.NO. 968/MDS/2016, THE ASSESSEE HAS TAKEN ALTOGETHER NI NE GROUNDS OF WHICH GROUND NOS.1,6,7,8 & 9 ARE GENERAL IN NATURE, REQUIRING NO SPECIFIC ADJUDICATION. 32. VIDE ITS GROUND NO.2, THE ASSESSEE IS AGGRIEVE D ON ADDITIONS OF ` 19 LAKHS, DISBELIEVING LOANS CLAIMED TO HAVE BEEN R AISED ONE FROM MR.B.NAGARAJAN AND M/S.LLOYDS PURE WATER TECHNOLOGY (P) LTD., WHICH WAS CONFIRMED BY THE LD.CIT(A). 33. LD.A.R SUBMITTED THAT ASSESSEE HAD FURNISHED C ONFIRMATION LETTER DATED 16.08.2013 FROM MR.B.NAGARAJAN FOR HAV ING GIVEN A LOAN OF ` 10 LAKHS TO THE ASSESSEE. AS PER LD.A.R, MR.B.NAGA RAJAN, WAS THE DIRECTOR OF M/S.LLOYDS PURE WATER TECHNOLOGY (P) LT D., AND HAD GIVEN THE ABOVE LOAN OF ` 10 LAKHS TO THE ASSESSEE THROUGH ACCOUNT PAYEE CHEQUE. ASSESSEE, AS PER LD.A.R, HAD SUBMITTED COP Y OF THE ACCOUNT OF MR.B.NAGARAJAN WITH CORPORATION BANK. AS PER LD.A. R, THE LOAN WAS GIVEN BY MR.B.NAGARAJAN FROM HIS NRI ACCOUNT. FURTH ER, AS PER LD.A.R, THE LOWER AUTHORITIES HAD THESE DISBELIEVED EVIDENC E. IN SO FAR AS THE SUM OF ` 9 LAKHS CLAIMED TO HAVE BEEN RECEIVED FROM M/S.LLOY DS PURE WATER TECHNOLOGY (P) LTD. LD.A.R SUBMITTED THAT T HIS SUM WAS ALSO RECEIVED THROUGH CHEQUES ISSUED BY THE SAID COMPANY FROM ITS ACCOUNT WITH CORPORATION BANK, NANGANALLUR BRANCH,CHENNAI. LD.A.R SUBMITTED THAT IN THE CONFIRMATION FILED BY THE ASSESSEE, PA N OF THE SAID ITA NO. 967 TO 969/16 :- 14 - : COMPANY WAS CLEARLY MENTIONED. DESPITE THIS EVIDENC E, THE LOANS WERE DISBELIEVED AND AN ADDITION OF ` 19 LAKHS WAS ADDED TO INCOME OF ASSESSEE. 34. PER CONTRA, LD.D.R STRONGLY SUPPORTED THE ORDE RS OF LOWER AUTHORITIES. 35. WE HAVE CONSIDERED THE RIVAL CONTENTIONS AND P ERUSED THE ORDERS OF THE AUTHORITIES BELOW. MR.B.NAGARAJAN HA D FILED CONFIRMATION FOR HIMSELF AS WELL AS ON BEHALF OF M/S.LLOYDS PURE WATER TECHNOLOGY (P) LTD., FOR SUM OF ` 10 LAKHS GIVEN BY MR.B.NAGARAJAN IN HIS PERSONAL CAPACITY AND ` 9 LAKHS GIVEN BY THE COMPANY, M/S.LLOYDS PURE WAT ER TECHNOLOGY (P) LTD. CONFIRMATION COPY OF WHICH IS PLACED AT PAGE NO.2,3,5 & 6 OF PAPER BOOK GIVES THE ADDRESSES OF T HE CREDITORS AND THE PAN OF MR.B.NAGARAJAN. MR.B.NAGARAJAN WAS A NRI AND THE LOAN OF ` 10 LAKHS WAS GIVEN FROM HIS NRE BANK ACCOUNT. STATE MENT OF SUCH ACCOUNT FOR THE PERIOD 11.07.2009 TO 30.07.2009 HAS BEEN PLACED AT PAGE NO.4 OF PAPER BOOK. IT IS NOT DISPUTED BY THE LOWER AUTHORITIES THAT THE LOAN WAS RECEIVED BY CHEQUE. WE ALSO FIND THAT LD.CIT(A) HAD SOUGHT A REMAND REPORT ON THE DETAILS FILED BY THE ASSESSEE. IN THE REMAND REPORT, THE AO MERELY MENTIONED THAT EVIDENC E WAS NOT SATISFACTORY WITHOUT SPELLING OUT WHAT DEFICIENCY H E HAD FOUND IN SUCH EVIDENCE, WHICH COMPELLED HIM TO TAKE A VIEW THAT T HE LOAN WAS NOT BELIEVABLE. HOWEVER, FOR THE LOAN OF ` 9 LAKHS CLAIMED TO HAVE BEEN ITA NO. 967 TO 969/16 :- 15 - : RECEIVED M/S.LLOYDS PURE WATER TECHNOLOGY (P) LTD., ASSESSEE HAD NOT FILED ANY SUPPORTING EVIDENCE EXCEPT FOR THE CONFIR MATION GIVEN BY MR.B.NAGARAJAN. NEITHER THE BANK ACCOUNT OF M/S.LL OYDS PURE WATER TECHNOLOGY (P) LTD., NOR ADDRESS OF ITS REGISTERED OFFICE NOR PAN OF THE SAID COMPANY IS AVAILABLE ON RECORD. IN OUR OPINION , THE GENUINENESS OF THE CLAIM OF LOAN OF ` 9 LAKHS RECEIVED FROM M/S.LLOYDS PURE WATER TECHNOLOGY (P) LTD., REQUIRE FRESH VERIFICATION. HE NCE, THE CLAIM OF ASSESSEE WITH REGARD TO THE LOAN OF ` 9 LAKHS FROM M/S.LLOYDS PURE WATER TECHNOLOGY (P) LTD., IS REMITTED BACK TO THE FILE OF AO FOR CONSIDERATION OF AFRESH. ASSESSEE SHALL PRODUCE WHA TEVER EVIDENCE HE WANTS TO PROVE THE SAID CREDIT. HOWEVER, INSOFAR AS THE CREDIT OF ` 10 LAKHS FROM MR.B.NAGARAJAN CONCERNED, IN OUR OPINION , THE EVIDENCE FURNISHED BY THE ASSESSEE WAS SATISFACTORY. IN THE RESULT, OUT OF THE TOTAL ADDITION OF ` 19 LAKHS, SUM OF ` 10 LAKHS STANDS DELETED WHEREAS THE BALANCE SUM OF ` 9 LAKHS IS REMITTED BACK TO THE FILE OF AO FOR CONSIDERATION AFRESH. GROUND NO.2 OF THE ASSESSEE STANDS PARTLY ALLOWED. 36. IN ITS GROUND NO.3, THE ASSESSEE ASSAILS ADDIT IONS OF ` 4 LAKHS MADE BY AO DISBELIEVING THE CLAIM OF REFUND OF LOAN EARLIER GIVEN BY THE ASSESSEE TO ONE MRS.KADAMBARI PRADMASREE. 37. LD.A.R SUBMITTED THAT MRS.KADAMBARI PRADMASREE HAD CONFIRMED REFUND OF LOAN EARLIER GIVEN TO HER BY TH E ASSESSEE VIDE ITA NO. 967 TO 969/16 :- 16 - : CONFIRMATION PLACED AT PAGE NO.7 OF PAPER BOOK. AC CORDING TO HIM, THE SAID PERSON HAD GIVEN HER PAN AND ADDRESS. AS P ER LD.A.R, ASSESSEE HAD EARLIER GIVEN A LOAN OF ` 4 LAKHS TO MRS.KADAMBARI PRADMASREE IN PREVIOUS YEAR RELEVANT TO ASSESSMENT YEAR 2007-08, WHICH WAS RETURNED BY THE SAID PERSON DURING THE RE LEVANT PREVIOUS YEAR. ONLY FOR A REASON THAT CASH BOOK WAS NOT MAIN TAINED BY THE ASSESSEE, THE CLAIM WAS DISBELIEVED. AS PER LD.A.R, THERE WAS NO REASON FOR THE ADDITION. 38. PER CONTRA, THE LD. DR SUPPORTED THE ORDERS OF THE AUTHORITIES BELOW. 39. WE HAVE CONSIDERED THE RIVAL CONTENTIONS AND P ERUSED THE ORDERS OF THE AUTHORITIES BELOW. THE ASSESSEE HAD P RODUCED CONFIRMATION FROM MRS.KADAMBARI PRADMASREE FOR THE REFUND OF ` 4 LAKHS BY MRS.KADAMBARI PRADMASREE THROUGH ACCOUNT P AYEE CHEQUE. NONE OF THE AUTHORITIES DISPUTED THE CLAIM OF ASSES SEE THAT IT WAS RETURN OF LOAN GIVEN BY THE ASSESSEE TO MRS.KADAMBA RI PRADMASREE IN AN EARLIER YEAR. BUT, FOR STATING THAT THE EVIDENCE FILED BY THE ASSESSEE WAS UNSATISFACTORY, NOTHING SPECIFIC HAS BEEN MENTI ONED BY THE AO IN HIS REMAND REPORT. IN OUR OPINION, THE ADDITION WAS NOT CALLED FOR. SUCH ADDITION STANDS DELETED. GROUND NO.3 STANDS ALLOWED . 40. VIDE ITS GROUND NO.4, GRIEVANCE RAISED BY THE ASSESSEE IS THAT DEPOSITS TOTALING TO ` 7 LAKHS MADE BY HIM IN HIS BANK ACCOUNT WAS ITA NO. 967 TO 969/16 :- 17 - : SUBJECTED TO AN ADDITION FOR WANT OF SOURCE, WHICH WAS CONFIRMED BY THE CIT(A) ON APPEAL. 41. LD.A.R SUBMITTED THAT ASSESSEE HAD WITHDRAWALS OF ` 12,71,000/- FROM HIS BANK ACCOUNTS. AS PER LD.A.R, THE DEPOSIT OF ` 7 LAKHS IN THE BANK ACCOUNT OF I.O.B, ADYAR BRANCH WA S OUT OF SUCH EARLIER WITHDRAWALS. FURTHER, ACCORDING TO LD.A.R, ASSESSEE HAD SUBSTANTIAL EARNINGS FROM AGRICULTURAL OPERATIONS. THUS, AS PER LD.A.R, THE ADDITIONS WERE MADE PURELY ONSURMISES. 42. PER CONTRA, THE LD. DR SUPPORTED THE ORDERS OF THE AUTHORITIES BELOW. 43. WE HAVE CONSIDERED THE RIVAL CONTENTIONS AND P ERUSED THE ORDERS OF THE AUTHORITIES BELOW. ASSESSEE HAS FURNI SHED A COMBINED STATEMENT OF HIS ACCOUNTS WITH IOB AND INDIAN BANK AT PAGE NO.8 OF PAPER BOOK. THE STATEMENT REFLECTS THE FOLLOWING T RANSACTIONS. COMBINED STATEMENT OF IOB, A/C & INDIAN BANK F.Y 2009-10 BANK DATE AMOUNTS DEPOSITED AMOUNT WITHDRAWN IN RS. IOB A/C 08.04.2009 1,20,000 INDIAN BANK 17.04.2009 50,000 IOB, A/C 06.05.2009 1,60,000 INDIAN BANK 18.05.2009 80,000 IOB, A/C 04.06.2009 2,50,000/- IOB, A/C 08.07.2009 2,00,000/- IOB, A/C 24.07.2009 2,26,000 IOB 07.09.2009 1,70,000 IOB 22.10.2009 50,000 INDIAN BANK 20.10.2009 3,80,000 INDIAN BANK 15.12.2009 1,25,000 INDIAN BANK 25.02.2010 1,00,000 INDIAN BANK 19.03.2010 60,000 7,00,000 12,71,000 ITA NO. 967 TO 969/16 :- 18 - : THE ABOVE COMBINED STATEMENT WAS SUPPORTED BY THE B ANK ACCOUNT STATEMENTS FROM THE RESPECTIVE BANKS PLACED AT PAGE NOS.9 TO 17 OF PAPER BOOK. WITHDRAWALS MENTIONED IN THE COMBINED STATEMENT DO APPEAR IN THE BANK ACCOUNT STATEMENTS FILED BY T HE ASSESSEE. THE ONLY AMOUNT FOR WHICH WITHDRAWALS WERE NOT THERE WE RE ` 1,20,000/- ON 08.04.2009 AND ` 1,60,000/- DEPOSITED ON 06.05.2009. INSOFAR AS THE SECOND AMOUNT IS CONCERNED, ASSESSEE HAD WITHDR AWN ` 50,000/- ON 17.04.2009 AND HENCE, THE BALANCE WHICH REMAINED TO BE EXPLAINED COME TO ` 2,30,000/-. ASSESSEE HAD DECLARED AGRICULTURAL INCO ME OF ` 13,86,827/-FOR IMPUGNED ASSESSMENT YEAR. AO HAD HI MSELF ACCEPTED A SUM OF ` 3,14,850/- IN THE ASSESSMENT. THUS, IN OUR OPINION THE ASSESSEE HAD SUFFICIENT FUNDS WITH HIM TO EXPLAIN T HE DEPOSIT. IN SUCH CIRCUMSTANCES, WE ARE OF THE OPINION THAT THE ADDIT ION OF ` 7 LAKHS WAS NOT WARRANTED. SUCH ADDITION STANDS DELETED. HENCE, GROUND NO.4 OF ASSESSEE IS ALLOWED. 44. VIDE ITS GROUND NO.5, THE ASSESSEE ASSAILS THE SUSTENANCE OF ` 8,55,600/- OUT OF TOTAL ADDITION OF ` 10,71,977/- MADE BY AO DISBELIEVING THE CLAIM OF AGRICULTURAL INCOME. 45. THE ISSUE RELATING TO AGRICULTURAL INCOME CLAI MED BY THE ASSESSEE HAS ALREADY BEEN CONSIDERED BY US WHILE ADJUDICATING ITS GROUND NO.7 FOR ASSESSMENT YEAR 2009-10 AT PARA NO .28 OF THIS ORDER. ITA NO. 967 TO 969/16 :- 19 - : WE HAVE HELD THAT INCOME OF ` 25,000/- PER ACRE WOULD BE FAIR. LD. AO HAS MENTIONED THAT AGRICULTURAL HOLDING OF T HE ASSESSEE FOR THE RELEVANT PREVIOUS ASSESSMENT YEAR IS 20.99 ACRES. A CCORDINGLY, ASSESSEES AGRICULTURAL INCOME CAN BE FIXED AT ` 5,24,750/- FOR THE IMPUGNED ASSESSMENT YEAR ALSO. IN THE CASH FLOW STA TEMENT, ASSESSEE HAD SHOWN INFLOW FROM AGRICULTURAL OPERATIONS AT ` 8,55,600/-. HENCE, THE ADDITION FOR EXCESS AGRICULTURAL INCOME IS REST RICTED TO ` 3,30,850/- AND THE BALANCE OF THE ADDITION IS DELETED. ACCORD INGLY, GROUND NO.5 OF ASSESSEE IS PARTLY ALLOWED. 46. IN THE RESULT, THE APPEAL OF FOR ASSESSMENT YE AR 2010-11 IS PARTLY ALLOWED. 47. COMING TO ASSESSMENT YEAR 2011-12 IN I.T.A.NO. 969/MDS/2016, THE ASSESSEE HAS TAKEN ALTOGETHER EL EVEN GROUNDS OF WHICH GROUND NOS.1,8,9,10 & 11 ARE GENERAL IN NATUR E, REQUIRING NO SPECIFIC ADJUDICATION. 48. VIDE ITS GROUND NO.2, THE ASSESSEE IS AGGRIEVE D ON ADDITIONS OF ` 21,13,000/- AS UNEXPLAINED CREDIT U/S.68 OF THE ACT , WHICH WAS CONFIRMED BY LD.CIT(A). 49. LD.AR, STRONGLY ASSAILING THE ORDERS OF THE LO WER AUTHORITIES SUBMITTED THAT COPY OF THE I.O.B BANK ACCOUNT PLACE D AT PAGE 48 OF THE PAPER BOOK REFLECTED THE FOLLOWING DEPOSITS. ITA NO. 967 TO 969/16 :- 20 - : BANK DATE AMOUNT DEPOSITED IOB, ADYAR 07.05.2010 55 ,000/ - IOB, ADYAR 08.06.2010 1,53 ,000/ - IOB, ADYAR 06.07.2010 2,2 0,000/ - IOB, ADYAR 13.07.2010 55 ,000 IOB, ADYAR 17.08.2010 5 ,000/ - IOB, ADYAR 04.09.2010 80 ,000 IOB, ADYAR 03.11.20 10 3,0 0,000 IOB, ADYAR 04.12.2010 8 0,000 IOB, ADYAR 20.12.2010 15 ,000 IOB, ADYAR 18.01.2011 50,000/ - IOB, ADYAR 31.01.2011 1, 50,000 IOB, ADYAR 12.02.2011 3,50,000 IOB, ADYAR 21.02.2011 1,50,000 IOB, ADYAR 24.02.2011 50,000 IOB, ADYAR 11.03.2011 3,40,000 TOTAL 21,13,000 AS PER LD.A.R, EARLIER WITHDRAWALS MADE BY THE ASSE SSEE FROM VERY SAME BANK ACCOUNT AND ANOTHER ACCOUNT WITH INDIAN B ANK, PONDICHERRY EXPLAINED SUBSTANTIAL PART OF THESE DEP OSITS. THE FOLLOWING WITHDRAWALS, AS PER THE LD.A.R MORE OR LESS EXPLAI NED THE ABOVE DEPOSITS MADE BY THE ASSESSEE. DATE BANK W ITHDRAWAL/OPE NING BALANCE DEPOSIT 01.04.2010 OPENING BALANCE 1,65,339 01.04.2010 IB 20,000 03.05.2010 IB 1,15,000 07.05.2010 IOB 55,000 CASH IN HAND CLOSING BALANCE 2, 45,339 DATE BANK WITHDRAWAL/OPE NING BALANCE DEPOSIT 07.06.2010 OPENING BALANCE 2,45,339 08.06.2010 IOB 1,53,000 06.07.2010 IOB 2,80,000 ITA NO. 967 TO 969/16 :- 21 - : 13.07.2010 IOB 55,000 17.08.2010 IOB 5,000 04.09.2010 IOB 80,000 TOTAL 2,45,339 5,73,000 ( - ) 3,2 7,661 CONTENTION OF THE LD.A.R WAS THAT THE DEFICIT OF ` 3,27,661/- REPRESENTED AGRICULTURAL INCOME. 50. FOR THE DEPOSITS MADE ON DATES SUBSEQUENT TO 0 4 TH SEPTEMBER, 2010, LD.A.R SUBMITTED THE FOLLOWING EXP LANATION. DATE BANK WITHDRAWAL/OPE NING BALANCE DEPOSIT 26.10.2010 IB 3,95,000 28.10.2010 IOB 8,00,000 30.10.2010 IOB 4,00,000 01.11.2010 IOB 2,00,000 3,00,000 03.11.2010 IOB 80,000 04.12.2010 IOB TOTAL 17,95,000 3,80,000 CASH IN HAND CLOSING BALANCE 14,15,000 DATE BANK WITHDRAWAL/OPE NING BALANCE DEPOSIT 19.12.2010 OPENING BALANCE 14,15,000 20.12.2010 IOB 125000 20.12.201 0 IOB 15,000 TOTAL 15,40,000 15,000 CLOSING BALANCE 15,25,000 DATE BANK WITHDRAWAL/OPEN ING BALANCE DEPOSIT 23.12.2010 OPENING BALANCE 15,25,000 24.12.2010 IB 65,000 18.01.2011 IOB 50,000 31.01.2011 IOB 1,50,000 12.02.2011 IOB 3,50,000 ITA NO. 967 TO 969/16 :- 22 - : 2 1.02.2011 IOB 1,50,000 24.02.2011 IOB 50,000 11.03.2011 IOB 3,40,000 TOTAL 15,90,000 10,90,000 CASH IN HAND 5,00,000 51. AS PER LD.A.R, JUST FOR A REASON THAT THERE W AS A SMALL TIME GAP BETWEEN WITHDRAWALS AND DEPOSITS, LOWER AUTHORI TIES OUGHT NOT HAVE IGNORED THE SOURCE OF DEPOSITS. FURTHER, AS P ER LD.A.R, THE ASSESSEE WAS NOT REQUIRED TO MAINTAIN BOOKS OF ACCO UNTS, SINCE RULE 6F AND SEC.44AA HAVE NO APPLICATION. 52. PER CONTRA, THE LD. DR SUPPORTED THE ORDERS OF THE AUTHORITIES BELOW. 53. WE HAVE CONSIDERED THE RIVAL CONTENTIONS AND P ERUSED THE ORDERS OF THE AUTHORITIES BELOW. COPIES OF BANK ACC OUNTS OF THE IOB AND INDIAN BANK HAS BEEN FILED AT PAGE NOS. 5 TO 8 OF PAPER BOOK. THE COMBINED STATEMENT SHOWS THAT DEPOSITS AND WITHDRAW ALS FROM THESE BANK ACCOUNTS WERE AS UNDER:- COMBINED STATEMENT OF IOB, A/C & INDIAN BANK F.Y 2009-10 BANK DATE DEPOSIT WITHDRAWAL RS. INDIAN BANK 01.04.2010 20,000 INDIAN BANK 03.05.2010 1,15,000 IOB A/C 07.05.2010 55,000 IOB A/C 08.06.2010 1,53,000 IOB A/C 06.07.2010 2,80,000 IOB A/C 13.07.2010 55,000 IOB A/C 17.08.2010 5,000 IOB A/C 04.09.2010 80,000 INDIAN BANK 26.10.2010 395000 IOB A/C 28.10.2010 800000 ITA NO. 967 TO 969/16 :- 23 - : IOB A/C 30.10.2010 4,00,000 IOB A/C 01.11.2010 2,00,000 IOB A/C 03.11.2010 3,00,000 IOB A/C 04.12.2010 80,000 IOB A/C 20.12.2010 1,25,000 IOB A/C 20.12.2010 15,000 INDIAN BANK 24.12.2010 65,000 IOB A/C 18.01.2011 50,000 IOB A/C 31.01.2011 1,50,000 IOB A/C 12.02.2011 3,50,000 IOB A/C 21.02.2011 1,50,000 IOB A/C 24.02.2011 50,000 IOB A/C 11.03.2011 3,40,000 2113000 2120000 EACH OF THE WITHDRAWAL & DEPOSIT SHOWN IN THE ABOVE TABLE FINDS A PLACE IN THE BANK ACCOUNTS OF ASSESSEE. THUS, THE A SSESSEE HAD WITHDRAWALS TOTALING ` 21,20,000/- IN CASH, AGAINST WHICH DEPOSITS, CAME TO ` 21,13,000/- ONLY. THE GAP BETWEEN WITHDRAWALS AND THE DEPOSITS WERE NOT SUBSTANTIAL ENOUGH TO DISBELIEVE THE VERSION OF THE ASSESSEE THAT THE DEPOSITS WERE MADE OUT OF EARLIER CASH WITHDRAWALS. FURTHER, ASSESSEE HAD CLAIMED AGRICULTURAL INCOME O F ` 10,56,320/-, AGAINST WHICH THE AO HIMSELF HAVE ASSESSED AS A SUM OF ` 3,14,850/-. IN SUCH SITUATION, WE ARE OF THE OPINION THAT ASSES SEE HAD EXPLAINED THE SOURCE OF DEPOSITS IN HIS BANK ACCOUNT. ADDITIO N OF ` 21,13,000/- IS DELETED. GROUND NO.2 OF THE ASSESSEE IS DELETED. 54. VIDE ITS GROUND NO.3, THE ASSESSEE IS AGGRIEVED ON SUSTENANCE OF AN ADDITION OF ` 3,65,000/- CLAIMED BY ASSESSEE AS ITA NO. 967 TO 969/16 :- 24 - : UNSECURED LOAN FROM HIS FATHER MR.V.RAMANATHAN, WHI CH WAS DISBELIEVED BY THE AO. 55. LD.A.R SUBMITTED THAT ASSESSEE HAD FILED CONF IRMATION FOR THE LOAN TAKEN FROM HIS FATHER MR.V.RAMANTHAN. AS PER L D.A.R, MR.V.RAMANATHAN HAD SUBSTANTIAL AGRICULTURAL HOLDIN G. LD.A.R SUBMITTED THAT OUT OF SUM OF ` 3,65,000/-, SUM OF ` 80,000/- WAS RECEIVED BY THE ASSESSEE BY CHEQUE AND THE BALANCE WAS RECEIVED IN CASH. PLACING RELIANCE ON THE PAGE NO.21 OF PAPER BOOK, WHICH IS A STATEMENT OF THE ACCOUNT OF MR.V.RAMANATHAN WITH IO B. LD.A.R SUBMITTED THAT HE HAD CASH WITHDRAWAL EXCEEDING ` 5,90,000/-. AS PER THE LD.A.R, THE CONFIRMATION FILED BY MR.V.RAMANATH AN WAS DISBELIEVED FOR NO GOOD REASON. 56. PER CONTRA, THE LD. DR SUPPORTED THE ORDERS OF THE AUTHORITIES BELOW. 57. WE HAVE CONSIDERED THE RIVAL CONTENTIONS AND P ERUSED THE ORDERS OF THE AUTHORITIES BELOW. ADMITTEDLY, MR.V. RAMANATHAN IS THE FATHER OF ASSESSEE. IN THE CONFIRMATION, MR.V.RAMAN ATHAN HAS GIVEN HIS FULL ADDRESS AND PAN. AO IN HIS REMAND REPORT T O THE LD.CIT(A), HAS MENTIONED THAT THE EVIDENCE FURNISHED BY THE AS SESSEE WAS NOT SATISFACTORY. HOWEVER, THE AO DID NOT POINT OUT ANY FLAW IN THE CONFIRMATION LETTER FILED BY MR.V.RAMANATHAN NOR SP ELL OUT WHY HE CONSIDERED THE EVIDENCE AS NOT SATISFACTORY. IF TH E AO DOUBTED THE ITA NO. 967 TO 969/16 :- 25 - : VERACITY OF THE CONFIRMATION OR DOUBTED THE SOURCE OF MR.V.RAMANATHAN TO GIVE THE LOAN TO THE ASSESSEE, H E OUGHT TO HAVE EXAMINED THE SAID PERSON BEFORE REJECTING THE CLAIM OF ASSESSEE. WE ARE OF THE OPINION THAT THE ASSESSEE HAD DONE WHATE VER WAS NECESSARY FOR PROVING THE LOAN. ADDITION OF ` 3,65,000/- STANDS DELETED. GROUND NO.3 OF THE ASSESSEE IS ALLOWED. 58. VIDE ITS GROUND NO.4, THE GRIEVANCE OF THE ASS ESSEE IS THAT AN ADDITION OF ` 6,66,,900/- MADE BY THE AO FOR THE ALLEGED DIFFEREN CE IN THE CASH FLOW STATEMENT AND RETURN OF INCOME IN RESPECT OF AMOUNT RECEIVED FROM M/S.INFO PLUS TECH PVT. LTD. AND MAHA TMA GANDHI MEDICAL RESEARCH CENTRE WAS CONFIRMED BY THE LD.CIT (A). 59. THE LD.A.R SUBMITTED THAT ASSESSEE HAD RECEIVE D ` 24 LAKHS FROM M/S.INFO PLUS TECH PVT. LTD., AND ` 6 LAKHS FROM MAHATMA GANDHI MEDICAL RESEARCH CENTRE MAHATMA GANDHI, WHICH WAS D ULY REFLECTED IN CASH FLOW STATEMENT. AS PER LD.A.R, IN THE RETURN OF INCOME ASSESSEE HAD SHOWN ` 13,90,300/- AS SALARY AND ` 9,32,800/- AS CONSULTANCY INCOME. AS PER THE LD.A.R, THE AO HAS ASKED EXPLANA TION FOR DIFFERENCE OF ` 6,66,,900/-. AS PER LD.A.R, ASSESSEE HAD EXPLAINED THAT ONLY THE NET AMOUNT OF INCOME WAS SHOWN BY HIM IN THE RETURN OF INCOME. SUBMISSION OF LD.A.R WAS THAT ASSESSEE HAD INCURRED SUBSTANTIAL EXPENDITURE FOR EARNING THE CONSULTANCY INCOME . AS PER LD.A.R, ASSESSEE WAS APPOINTED AS MANAGEMENT OFFICER BY M/S .INFO PLUS TECH ITA NO. 967 TO 969/16 :- 26 - : PVT. LTD. FROM 10 TH DECEMBER ONWARDS AND PAID SALARY THEREAFTER. ACCORDING TO HIM, THE EXPENDITURE FOR EARNING THE C ONSULTANCY FEES WAS IGNORED BY THE LOWER AUTHORITIES. 60. PER CONTRA, THE LD. DR SUPPORTED THE ORDERS OF THE AUTHORITIES BELOW. 61. WE HAVE CONSIDERED THE RIVAL CONTENTIONS AND P ERUSED THE ORDERS OF THE AUTHORITIES BELOW. THE CLAIM OF ASSE SSEE IS THAT AGAINST CONSULTANCY FEES, IT HAD INCURRED EXPENDITURE OF ` 6,67,,120/- AND THE NET CONSULTANCY INCOME WAS ` 9,32,880/- ONLY. IN SUPPORT, ASSESSEE HAS FILED DETAILS OF EXPENSES WHICH APPEAR AT PAGES 24 TO 35 OF PAPER BOOK. THE DETAILS OF EXPENSES INCLUDE CASH VOUCHER EVIDENCING PAYMENTS TO MR.R.IYAPPAN, MR.D.SUDHAKAR & DR. SAKTH IVEL, MR.R.MURALI,DRIVER, MS.JAYALAKSHMI, AND MS.C.DEVI F OR VARIOUS SERVICES RENDERED BY THEM. ASSESSEE HAS ALSO FILED COPIES O F HIS TELEPHONE BILLS. WE ARE OF THE OPINION THAT THE LOWER AUTHOR ITIES FELL IN ERROR IN TAKING A VIEW THAT WHOLE OF THE CONSULTANCY INCOME WOULD BE INCOME OF ASSESSEE. IN THE FACTS AND CIRCUMSTANCES, WE AR E OF THE OPINION 20% OF THE CONSULTANCY FEES OF ` 24 LAKHS OUGHT TO HAVE BEEN ALLOWED AS EXPENDITURE INCURRED BY THE ASSESSEE IN CONNECTION WITH EARNING OF SUCH INCOME. AFTER DEDUCTION OF 20% OF THE NET AMOUNT OF CONSULTANCY INCOME WOULD COME TO ` 19,20,000/-. ALONG WITH SALARY OF ` 6 LAKHS RECEIVED FROM MAHATMA GANDHI MEDICAL RESEAR CH CENTRE, THE ITA NO. 967 TO 969/16 :- 27 - : TOTAL RECEIPTS WOULD WORK OUT TO ` 25,20,000/-. THE INFLOW SHOWN BY THE ASSESSEE AGAINST THE ABOVE ITEMS IN HIS CASH FL OW STATEMENT IS ` 30 LAKHS. IN OUR OPINION, THE DIFFERENCE OF ` 4,80,000/- ALONE COULD BE CONSIDERED. THEREFORE, WE RESTRICT THE ADDITION TO ` 4,80,000/- AS AGAINST THE ADDITION OF ` 6,66,,900/- CONSIDERED BY THE LOWER AUTHORITIES. GROUND NO.4 OF THE ASSESSEE IS PARTLY ALLOWED. 62. VIDE ITS GROUND NO.5, THE ASSESSEE AGGRIEVED O N ADDITION OF ` 6 LAKHS DISBELIEVING A LOAN RECEIVED FROM ONE MR.R. JAYAGANATHAN. 63. LD.A.R SUBMITTED THAT ASSESSEE HAD FURNISHED CONFIRMATION LETTER DATED 28.08.2013 FROM MR.R.JAYAGANATHAN, A C OPY OF WHICH IS PLACED AT PAGE-38 OF PAPER BOOK. AS PER THE LD.A.R, IN THE CONFIRMATION LETTER RECEIVED FROM MR.R.JAYAGANATHAN, THE IDENTIT Y OF THE CREDITOR AND HIS PAN NUMBER WERE SHOWN. ACCORDING TO HIM, AS SESSEE HAD DISCHARGED THE ONUS OF PROVING THE IDENTITY OF THE CREDITOR AND HAD ALSO FURNISHED THEIR FULL ADDRESS AND PAN. AS PER T HE LD.A.R, MR.R.JAYAGANATHAN OWNED 6.7 ACRES OF AGRICULTURAL LAND AND SUPPORTING DOCUMENT IN THE NATURE OF COPY OF ADANGA L OBTAINED FROM PRINCIPAL DEPUTY TAHSILDAR, PAPPIREDDIPATTI TALUK, DHARMAPURI DISTRICT WAS ALSO PRODUCED. CONTENTION OF THE LD.A.R WAS THA T THE LOANS HAVING BEEN RECEIVED BY CHEQUE, OUGHT NOT TO HAVE BEEN DIS BELIEVED. 64. PER CONTRA, THE LD. DR SUPPORTED THE ORDERS OF THE AUTHORITIES BELOW. ITA NO. 967 TO 969/16 :- 28 - : 65. WE HAVE CONSIDERED THE RIVAL CONTENTIONS AND P ERUSED THE ORDERS OF THE AUTHORITIES BELOW. A COPY OF CONFIRMA TION LETTER DATED 28.08.2013 RECEIVED FROM MR.R.JAYAGANATHAN HAS BEEN PLACED AT PAGE-38 OF PAPER BOOK. AS MENTIONED BY THE LD.A.R, THE SAID CONFIRMATION DOES SHOW THE ADDRESS OF MR.R.JAYAGANA THAN. IT IS ALREADY STATED THEREIN THAT HE WAS OWNING 6.7 ACRES OF AGRICULTURAL LAND. IN SUPPORT OF COPY OF ADNAGAL HAS ALSO BEEN FILED. IN THE REMAND REPORT, AO SIMPLY MENTIONED THE EVIDENCE FILED BY T HE ASSESSEE WAS NOT SATISFACTORY. HE HAS NOT POINTED OUT ANY FLAW IN THE EVIDENCE FILED BY THE ASSESSEE. WE ARE OF THE OPINION THAT ASSESSE E HAVING RECEIVED THE MONEY BY ACCOUNT PAY CHEQUE AND HAVING FILED TH E PROPER CONFIRMATION, THE CREDIT COULD NOT HAVE BEEN CONSID ERED AS BOGUS. THE ADDITION STANDS DELETED. GROUND NUMBER 5 OF THE AS SESSEE IS ALLOWED. 66. VIDE ITS GROUND NO.6, THE GRIEVANCE OF THE ASS ESSEE IS THAT THE LD.CIT(A) CONFIRMED AN ADDITION OF ` 3 LAKHS DISBELIEVING A RECEIPT FROM ONE MR.RAGHUPATHY. 67. THE LD.A.R ASSAILING THE ORDERS OF LOWER AUTHO RITIES SUBMITTED THAT CONFIRMATION FROM MR.R. RAGHUPATHY WAS FILED B Y THE ASSESSEE. AS PER THE LD.A.R, THE MONEY WAS RECEIVED BY CHEQUE AND PAN OF MR.R. RAGHUPATHY WAS ALSO AVAILABLE. WITHOUT BRINGI NG OUT ANY DEFECT IN THE CONFIRMATION LETTER AND WITHOUT MAKING ANY F URTHER ENQUIRIES, ITA NO. 967 TO 969/16 :- 29 - : THE AUTHORITIES BELOW HAD DISBELIEVED THE RECEIPT. ACCORDING TO LD.A.R, THE ADDITION WAS UNFAIRLY MADE. 68. PER CONTRA, THE LD. DR SUPPORTED THE ORDERS OF THE AUTHORITIES BELOW. 69. WE HAVE CONSIDERED THE RIVAL CONTENTIONS AND P ERUSED THE ORDERS OF THE AUTHORITIES BELOW. CONFIRMATION LETT ER FILED BY MR.R. RAGHUPATHY IS REPRODUCED AS UNDER:- TO WHOMSOEVER IT MAY CONCERN THIS IS TO CERTIFY THAT I HAVE RECEIVED A SUM OF AM OUNT OF RS.3,00,000/- (TRHEE LAKHS ONLY) ON 01.11.2010 VIDE CHEQUE NO.815 002 FROM DR.AKILAN RAMANATHAN, PAN NO.ACQPA 2957 G, PRESENTLY RESIDING AT NO.9 STATE BANK COLONY, SHASTRI NAGAR, ADYAR,CHENNAI-20. THE AME AMOUNT HAS BEEN RETURNED ON 26.03.2011 VIDE CHEQUE NO.688101 SUM OF RS.3 LAKHS DURING THE FY 2010-11. SD/- (R. RAGHUPATHY) PAN NO.AIEPR 3986 J, L 541 24TH CROSS ST,THIRUVAL LUVAR NAGAR, THIRUVANMIYAR CHENNAI 600 041 . IT IS MENTIONED BY MR.R. RAGHUPATHY THAT MONEY WAS BEING GIVEN AS REFUND OF AN EARLIER LOAN RECEIVED FROM THE ASSESSE E BY HIM. MR.R. RAGHUPATHY HAS ALSO MENTIONED THAT HE HAD RECEIVED THE SUM EARLIER FROM THE ASSESSEE ON 01.11.2010. ACCORDING TO MR.R. RAGHUPATHY, THE AMOUNT GIVEN BY HIM ON 26.03.2011 WAS THE RETURN OF THE EARLIER LOAN ITA NO. 967 TO 969/16 :- 30 - : TAKEN BY HIM FROM THE ASSESSEE. NOTHING WAS BROUGHT OUT BY THE LOWER AUTHORITIES AS TO WHY THE ABOVE CONFIRMATION WAS DI SBELIEVED. THE AO SIMPLY MENTIONED IN HIS REMAND REPORT THAT THE EVID ENCE WAS NOT SATISFACTORY, WITHOUT POINTING OUT ANY FLAW. WE ARE OF THE OPINION THAT THE ADDITION WAS MADE PURELY ON SURMISE. SUCH ADDIT ION STANDS DELETED. GROUND NO.6 OF THE ASSESSEE STANDS ALLOWED . 70. VIDE ITS GROUND NO.7, THE GRIEVANCE OF THE AS SESSEE IS THAT THE LD.CIT(A) RESTRICTED THE ADDITION OF AGRICULTUR AL INCOME TO ` 10,56,320/- INSTEAD OF DELETING IT IN TOTO. 71. THIS GROUND TAKEN BY THE ASSESSEE IS SIMILAR T O THE GROUND NO.7 FOR A.Y 2009-10 & GROUND NO.5 FOR A.Y 2010-11. 72. WE HAD HELD THAT FROM 20.99 ACRES OF AGRICUL TURAL LAND OWNED BY THE ASSESSEE, HE COULD HAVE EARNED A NET A GRICULTURAL INCOME OF ` 25,000/- PER ACRE. ACCORDINGLY, THE AGRICULTURAL I NCOME OF ASSESSEE FOR THE IMPUGNED ASSESSMENT YEAR HAS TO BE TAKEN AT ` 5,24,750/-. THE AMOUNT SHOWN BY THE ASSESSEE IN THE CASH FLOW STATEMENT WAS ` 10,56,320/- AS NET AGRICULTURAL INCOME. HENCE, THE ADDITION UNDER THIS HEAD, IN OUR OPINION, HAS TO BE RESTRICTED TO ITA NO. 967 TO 969/16 :- 31 - : ` 5,31,570/-. RELIEF TO THAT EXTENT IS GIVEN TO THE A SSESSEE. GROUND NO.7 IS TREATED AS PARTLY ALLOWED. 73. IN THE RESULT , THE APPEAL OF ASSESSEE IS PART LY ALLOWED. 74. TO SUMMARIZE, ALL THE APPEALS OF THE ASSESSEE ARE PARTLY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 16 TH SEPTEMBER, 2016, AT CHENNAI. SD/ - SD/ - ( . # ) (G. PAVAN KUMAR) $ / JUDICIAL MEMBER ( . ) (ABRAHAM P. GEORGE) / ACCOUNTANT MEMBER '# / CHENNAI $% / DATED: 16 TH SEPTEMBER, 2016 K S SUNDARAM %& '()( / COPY TO: 1 . / APPELLANT 4. * / CIT 2. / RESPONDENT 5. (+, - / DR 3. *./ / CIT(A) 6. ,01 / GF