Shri Gajraj Kaushik, Rohtak V. ITO, Rohtak

ITA 986/DEL/2011

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 86988 (ITAT-DELHI)
• Duration Of Justice: 4 year(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-03-2015
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: C
• Next Hearing Date: 19-03-2015
• Assessment Year: 2007-2008
• Appeal Filed On: 21-02-2011
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: T VASANTHAN
• Keywords: Peak credit; Additional evidence
• Section: 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES : C : NEW DELHI BEFORE SHRI R.S. SYAL, AM AND SHRI C.M. GARG, JM ITA NO.804/DEL/2011 ASSESSMENT YEAR : 2007-08 ITO, WARD-1, ROHTAK. VS. GAJRAJ KAUSHIK, S/O LATE SHRI UJALA RAM, H. NO.2328, HOUSING BOARD, SECTOR 2, 3 & 4, ROHTAK. PAN: AGIPK9638A ITA NO.986/DEL/2011 ASSESSMENT YEAR : 2007-08 GAJRAJ KAUSHIK, S/O LATE SHRI UJALA RAM, H. NO.2328, HOUSING BOARD, SECTOR 2, 3 & 4, ROHTAK. PAN: AGIPK9638A VS. ITO, WARD-1, ROHTAK. (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI SURESH KUMAR GUPTA, CA DEPARTMENT BY : SHRI T. VASANTHAN, SR. DR ITA NOS.804 & 986/DEL/2011. 2 DATE OF HEARING : 19.03.2015 DATE OF PRONOUNCEMENT : 20 .03.2015 ORDER PER R.S. SYAL, AM: THESE TWO CROSS APPEALS ONE BY THE ASSESSEE AND THE OTHER BY THE REVENUE ARISE OUT OF THE ORDER PASSED BY THE CIT( A) ON 7.12.2010 IN RELATION TO THE ASSESSMENT YEAR 2007-08. 2. THE ONLY ISSUE RAISED IN THIS APPEAL THROUGH VAR IOUS GROUNDS OF THE REVENUE IS AGAINST THE REDUCTION IN THE ADDITION FR OM RS.32,03,316/- AS MADE BY THE AO TO RS.10,67,010/- . THE LD. AR DID N OT OBJECT TO THE SUBMISSION OF THE LD. DR FOR ADOPTION OF THE CORRE CT AMOUNT OF ADDITION SUSTAINED IN THE GROUNDS OF THE REVENUES APPEAL, W ITHOUT ANY FORMAL AMENDMENT TO THE FORM NO. 36. THE ASSESSEE IN HIS CROSS OBJECTION IS AGGRIEVED AGAINST THE SUSTENANCE OF ADDITION TO THE EXTENT OF RS.10,67,010/-. 3. BRIEFLY STATED, THE FACTS OF THE CASE ARE THAT T HE ASSESSEE, A PRACTISING DOCTOR, FILED HIS RETURN DECLARING TOTAL INCOME OF RS.1,16,650/. THE AO REQUIRED THE ASSESSEE TO SUBSTANTIATE THE CO NTENTS OF HIS RETURN OF ITA NOS.804 & 986/DEL/2011. 3 INCOME. SEVERAL OPPORTUNITIES WERE GRANTED WHICH W ERE NOT AVAILED BY THE ASSESSEE. ULTIMATELY, THE ASSESSMENT WAS COMPL ETED EX PARTE U/S 144 OF THE INCOME-TAX ACT, 1961 (HEREINAFTER ALSO CALLE D `THE ACT). THE AO NOTICED THAT THE ASSESSEE WAS MAINTAINING THE FOLLO WING BANK ACCOUNTS, WHICH WERE NOT DISCLOSED TO THE DEPARTMENT:- S.NO. BANK ACCOUNT NO. NAME OF BANK AMOUNT CREDITED DURING THE AY 2007-08 1. 55057764337 STATE BANK OF PATIALA, GOHANA 28,36, 338/- 2. 65010109060 -DO- 1,53,632/- 3. 65013829258 -DO- 5,00,000/- 4. 65015828649 -DO 4,00,986/- 5. 65016274449 -DO- 1,00,000/- 6. PNB LOAN ACCOUNT (REPAYMENTS) 2,15,000/- 7. HDFC AUTO LOAN (REPAYMENTS) 1,47,360/- TOTAL 43,53,316/- 4. ON PERUSAL OF THE COMPUTATION OF INCOME, IT WAS OBSERVED THAT NOT ONLY THESE BANKS ACCOUNTS WERE NOT DISCLOSED, EVEN NO INTEREST INCOME FROM SUCH BANKS ACCOUNTS WAS OFFERED. CREDIT ENTRIE S IN THE ABOVE BANK ACCOUNTS WERE TOTALED AT RS.43,53,316/-. THE AO OB SERVED THAT INITIAL INVESTMENT AMOUNTING TO RS.11.50 LAC WAS MADE, TO WHICH EXTENT THESE DEPOSITS WERE TREATED AS EXPLAINED. THE REMAINING AMOUNT OF RS.32,03,316/- (RS.43,53,316 MINUS RS.11,50,000) WA S MADE AS ITA NOS.804 & 986/DEL/2011. 4 ADDITION. THE LD. CIT(A) ENTERTAINED SOME ADDITION AL EVIDENCE FROM THE ASSESSEE. HE CALLED FOR THE REMAND REPORT. AFTER CONSIDERING THE ADDITIONAL EVIDENCE, THE REMAND REPORT AND THE REJO INDER GIVEN BY THE ASSESSEE, THE LD. CIT(A) COMPUTED PEAK CREDIT TO TH E TUNE OF RS.9,19,560/- AS UNEXPLAINED CASH DEPOSIT. HE, THE REFORE, DIRECTED THE AO TO VERIFY THE STATEMENT FILED BY THE ASSESSEE CO MPUTING SUCH PEAK CREDIT BEFORE GIVING EFFECT TO HIS ORDER. AS REGAR DS THE REPAYMENT OF LOAN FROM HDFC BANK AMOUNTING TO RS.1,47,360/-, HE SUSTAINED ADDITION FOR THIS SUM ALSO IN THE ABSENCE OF THE AS SESSEE FURNISHING ANY EVIDENCE. ACCORDINGLY, TOTAL ADDITION WAS SUSTAINE D AT RS.10,67,010/- SUBJECT TO VERIFICATION BY THE AO, AS AGAINST THAT MADE BY THE AO AT RS.32,03,316/-. BOTH THE SIDES ARE IN APPEAL ON THE IR RESPECTIVE STANDS. 5. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE RELEVANT MATERIAL ON RECORD. IT CAN BE SEEN FROM THE ASSESS MENT ORDER THAT DESPITE GIVING SEVERAL OPPORTUNITIES, THE ASSESSEE DID NOT PARTICIPATE IN THE ASSESSMENT PROCEEDINGS. IT IS ALSO NOT DENIED THAT THE ASSESSEE HAD SEVEN BANK ACCOUNTS WHICH WERE UNDISCLOSED IN WHICH THERE WERE CERTAIN ITA NOS.804 & 986/DEL/2011. 5 DEPOSITS AND INTEREST WAS ALSO EARNED THEREFROM WHI CH WAS NOT DECLARED BY THE ASSESSEE. THE LD. CIT(A) ACCEPTED THE AMOUN T OF PEAK CREDIT TO BE TAXABLE FROM THE BANK ACCOUNTS, SUBJECT TO THE VERIFICATION BY THE AO. IN OUR CONSIDERED OPINION, IF THERE ARE CERTAI N DEPOSITS AND ALSO WITHDRAWALS IN A BANK ACCOUNT WHICH IS NOT DISCLOSE D, THEN A TOTAL OF ALL THE CREDIT ENTRIES CANNOT BE SUBJECTED TO ADDITION BY DISREGARDING THE WITHDRAWALS FROM SUCH BANK ACCOUNT. IT IS, IN FACT , THE PEAK CREDIT WHICH IS REQUIRED TO BE ADDED BECAUSE THE SOURCE OF CERTA IN DEPOSITS CAN BE CLEARLY MADE OUT FROM THE WITHDRAWALS FROM THE SAME BANK ACCOUNT. WE, THEREFORE, UPHOLD THE VIEW TAKEN BY THE LD. CIT (A) IN DIRECTING THE AO TO VERIFY THE STATEMENT OF COMPUTATION OF PEAK C REDIT AT RS.9,19,650/- AND SUSTAINING THE ADDITION TO THIS L EVEL, IF SUCH STATEMENT IS FOUND TO BE CORRECT. AS REGARDS THE OTHER AMOUN T, WE FIND THAT THE ASSESSEE DID MAKE REPAYMENT OF LOAN FROM HDFC BANK ACCOUNT TO THE TUNE OF RS.1,47,360/- FOR WHICH NO SOURCE WAS EXPLA INED TO THE SATISFACTION OF THE AUTHORITIES BELOW. UNDER SUCH CIRCUMSTANCES, THE LD. CIT(A) WAS JUSTIFIED IN SUSTAINING ADDITION TO THIS EXTENT. WE, THEREFORE, APPROVE THE IMPUGNED ORDER. ITA NOS.804 & 986/DEL/2011. 6 6. IN THE RESULT, BOTH THE APPEALS STAND DISMISSED. THE ORDER PRONOUNCED IN THE OPEN COURT ON 20.03.201 5. SD/- SD/- [C.M. GARG] [R.S. SYAL] JUDICIAL MEMBER ACCOUNTANT MEMBER DATED, 20 TH MARCH, 2015. DK COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT (A) 5. DR, ITAT AR, ITAT, NEW DELHI.