MALLELA RAJESH NAIDU, VIJAYAWADA V. DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE-1, GUNTUR

ITA 99/VIZ/2023

• Counselvise Citation: [2024] 100 COUNSELVISE.COM (IT) 3209 (ITAT-VISAKHAPATNAM)
• Duration Of Justice: 1 year(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-03-2024
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 20-03-2024
• Assessment Year: 2020-2021
• Appeal Filed On: 19-03-2023
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: APARNA VILLURI
• Section: 131; 132; 44AD; 143(3); 69A; 44AB

Judgement Text

आयकरअपीलीयअधिकरण, धिशाखापटणम “SMC” पीठ, धिशाखापटणम IN THE INCOME TAX APPELLATE TRIBUNAL, VISAKHAPATNAM “SMC” BENCH, VISAKHAPATNAM श्री द ु व्वूरु आर एल रेड्डी, न्याधयक सदस्य के समक्ष BEFORE SHRI DUVVURU RL REDDY, HON’BLE JUDICIAL MEMBER आयकर अपील सं./I.T.A.No.99/Viz/2023 (ननधधारण वर्ा / Assessment Year : 2020-21) Mallela Rajesh Naidu D.No.22-115, M.M.Street Chilakaluripet [PAN : AMJPM9124C] Vs. Dy.Commissioner of Income Tax Central Circle-1 Guntur (अपीलार्थी/ Appellant) (प्रत्यर्थी/ Respondent) अपीलधथी की ओर से/ Appellant by : Shri M.V.Prasad, AR प्रत्यधथी की ओर से / Respondent by : Dr.Aparna Villuri, DR सुनवधई की तधरीख / Date of Hearing : 21.03.2024 घोर्णध की तधरीख/Date of Pronouncement : 28.03.2024 आदेश /O R D E R Per Shri Duvvuru RL Reddy, Judicial Member : This appeal is filed by the assessee against the order of Commissioner of Income Tax (Appeals) [CIT(A)], Visakhapatnam vide DIN & Order No. ITBA/APL/S/250/2022-23/1049221489(1) dated 30.01.2023, arising out of order passed u/s 143(3) of the Income Tax Act, 1961 (in short ‘Act’) dated 28.09.2021 for the Assessment Year (A.Y.) 2020-21. 2. Brief facts of the case are that the assessee is an individual and a commission agent in buffalo trade. As per the information received from 2 I.T.A. No.99/Viz/2023, A.Y.2020-21 Mallela Rajesh Naidu, Chilakaluripet AIU-HYD, the assessee was intercepted at Gannavaram Airport around 08:30 p.m. on 14.10.2019 and it was found that the assessee was carrying cash of Rs.27 lakhs in his hand baggage. The assessee could not produce any kind of documents to explain the source for the cash he was carrying. Summons u/s 131 were served on him and statement u/s 131(1A) was recorded on 14.10.2019. It was stated by the assessee that Rs.11 lakhs was withdrawn from the bank account of M.R.Global Merchandise Pvt. Ltd. on 05.10.2019, Rs.13 lakhs was received from Sri Vema Gopala Krishna, cousin of the assessee at Hyderabad and Rs.3 lakhs from his own savings. Since the assessee could not properly explain the sources and failed to furnish proof for receipt of Rs.13 lakhs claimed to have received from his cousin, Sri Vema Gopala Krishna, the entire amount of Rs.27 lakhs was seized u/s 132 of the Act on 15.10.2019. After considering the submissions of the assessee, the assessment was completed and the Assessing Officer(AO) made an addition of Rs.27 lakhs to the returned total income. 3. On being aggrieved, the assessee preferred an appeal before the CIT(A) and the Ld.CIT(A) partly allowed the appeal filed by the assessee and sustained the addition of Rs.13 lakhs as the assessee has not submitted necessary evidence before the Ld.CIT(A). 3 I.T.A. No.99/Viz/2023, A.Y.2020-21 Mallela Rajesh Naidu, Chilakaluripet 4. On being aggrieved, the assessee preferred an appeal before the Tribunal by raising the following grounds of appeal : 1. The learned CIT(Appeals) is erred in facts and law while passing the order. 2. The learned CIT(Appeals) erred in confirming the addition of Rs.13.00 lacs even though section 69A is not applicable in the present facts of the case. 3. The learned CIT(Appeals) would have appreciated that the Assessing Officer erred in invoking the provisions of section 69A of the I.T.Act since the amount of Rs.11 lacs was already recorded in the books of account and which were produced before the Assessing Officer. 4. The Ld.CIT(Appeals) would have appreciated that the books of account were duly audited u/s 44AB read with section 44AD and the amount of loan of Rs.13 lacs obtained was already recorded in the books of account. 5. The appellant craves to add to, amend or modify the above grounds of appeal either before or at the time of hearing of the appeal, if it is considered necessary. 5. It was the submission of the assessee that the assessee had borrowed Rs.13 lakhs from one Sri Vema Gopala Krishna, none other than his cousin, which was recorded in his books of accounts. The assessee has filed confirmation letter before the Tribunal which was not filed either before the AO or the Ld.CIT(A). He further submitted that he filed the confirmation letter before the Tribunal for perusal and pleaded to delete the addition made by the AO. 4 I.T.A. No.99/Viz/2023, A.Y.2020-21 Mallela Rajesh Naidu, Chilakaluripet 6. On the other hand, the Ld.DR submitted that the confirmation letter does not contain the place of payment made to the assessee. Therefore, it requires verification. Moreover, the said confirmation letter was not placed either before the AO or the CIT(A) . The Ld.DR, therefore, pleaded to remit the matter back to the file of the AO to examine the creditor. 7. I have heard both the parties and perused the material available on record. It is an admitted fact that the revenue authorities seized an amount of Rs.27 lakhs at Gannavaram Airport around 8:30 p.m. on 14.10.2019. After considering the submissions, the Ld.CIT(A) sustained the addition of Rs.13 lakhs, as the assessee has not produced any satisfactory evidence before him and deleted an amount of Rs.14 lakhs as the assessee has explained the source. Now the assessee filed the confirmation letter by way of affidavit, which shows that the assessee borrowed an amount of Rs.13 lakhs from Sri Vema Gopala Krishna on 14.10.2019. On this aspect, the main contention of the Ld.DR is that there was no mention in the affidavit / confirmation letter that the amount was paid to the assessee at Hyderabad. However, it was the submission of the assessee that at the time of recording the statement u/s 131(1A), the assessee categorically deposed that he had borrowed an amount of Rs.13 lakhs from his cousin, by name, Vema Gopala Krishna at 5 I.T.A. No.99/Viz/2023, A.Y.2020-21 Mallela Rajesh Naidu, Chilakaluripet Hyderabad. But, the assessee has not filed confirmation letter before the revenue authorities saying that he borrowed an amount of Rs.13 lakhs from his cousin at Hyderabad on 14.10.2019. The assessee filed confirmation letter before me and on perusal of the said letter, there is no mention of the place, where the assessee had received an amount of Rs.13 lakhs from his cousin. Apart from this, in the confirmation letter, the loan was given to the assessee on 14.10.2019 by his cousin, Sri Vema Gopala Krishna, who is resident of Kanchikacherla, Krishna Dist. and the said amount was also seized on the same day at Gannavaram airport exit gate. Since there is ambiguity, I remit the matter back to the file of the AO to examine the issue and if the assessee proves that he had received the loan amount of Rs.13,00,000/- from his cousin on 14.10.2019 at Hyderabad, then the assessee is entitled to relief claimed by the assessee for an amount of Rs.13 lakhs. Accordingly, the grounds raised by the assessee are allowed for statistical purpose. 8. In the result, appeal of the assessee is allowed for statistical purpose. 6 I.T.A. No.99/Viz/2023, A.Y.2020-21 Mallela Rajesh Naidu, Chilakaluripet Order pronounced in the open court on 28 th March, 2024. Sd/- (द ु व्वूरु आर.एल रेड्डी) (DUVVURU RL REDDY) न्याधयक सदस्य/JUDICIAL MEMBER Dated : 28.03.2024 L.Rama, SPS आदेश की प्रतितिति अग्रेतिि/Copy of the order forwarded to:- 1. ननधधाऩरती/ The Assessee– Mallela Rajesh Naidu, D.No.22-115, M.M.Street, Chilakaluripet 2. रधजस्व/The Revenue – The Dy.Commissioner of Income Tax, Central Circle-1, Guntur 3. The Principal Commissioner of Income Tax, Guntur 4. नवभधगीय प्रनतनननध, आयकर अपीलीय अनधकरण, नवशधखधपटणम / DR,ITAT, Visakhapatnam 5..गधर्ा फ़धईल / Guard file आदेशधनुसधर / BY ORDER Sr. Private Secretary ITAT, Visakhapatnam