Smt. Geetaben N.Kapadia, Surat V. The ACIT.,Cent.Circle-4, Surat

ITSSA 159/AHD/2011

• Counselvise Citation: [2014] 122 COUNSELVISE.COM (IT) 0278 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 6 month(s) 27 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 19-09-2014
• Appeal Filed By: Assessee
• Bench Allotted: D
• Next Hearing Date: 10-09-2014
• Assessment Year: 2006-2007
• Appeal Filed On: 22-02-2011
• Court: TRIBUNAL
• Department Lawyers: VIMALENDRA VERMA
• Assessee Lawyers: RAJESH SHAH AR
• Keywords: Gift; Peak credit
• Section: 69

Judgement Text

, , , , IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH, AHMEDABAD 0 00 0 0 00 0 , , , , ! ! ! ! ' #$% ' #$% ' #$% ' #$% #& #&#& #&0 00 0# ## #0 00 0 '& '& '& '&, , , , () * () * () * () * ( ' ( ' ( ' ( ' BEFORE SHRI G.C. GUPTA, VICE PRESIDENT AND SHRI N.S. SAINI, ACCOUNTANT MEMBER % % % %./ ././ ./ ITA(SS) NO. 151/AHD/2011 & - $.- & - $.- & - $.- & - $.-/ // / ASSESSMENT YEAR: 2006-07 SHRI AMIT N. KAPADIA, 3/1810, GHAMLAWAD, SHERI NO. 1, GHAMLAWAD, SURAT. PAN: AKDPK2449J VS ASSTT. COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE-4, SURAT. /0/ (APPELLANT) 12 /0/ (RESPONDENT) % % % %./ ././ ./ ITA(SS) NO. 159/AHD/2011 & - $.- & - $.- & - $.- & - $.-/ // / ASSESSMENT YEAR: 2006-07 SMT. GEETABEN N. KAPADIA, (PROP. GNK JARI INDUSTRIES) 3/1810, GHAMLAWAD, SHERI NO. 1, GHAMLAWAD, SURAT. PAN: AAVPK4396H VS ASSTT. COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE-4, SURAT. /0/ (APPELLANT) 12 /0/ (RESPONDENT) REVENUE BY : SH. VIMALENDRA VERMA, DR ASSESSEE(S) BY : SHRI RAJESH SHAH, AR &$3 4 )/ // / DATE OF HEARING : 11/09/2014 56. 4 ) / DATE OF PRONOUNCEMENT: 19/09/2014 (7 (7 (7 (7/ // / O R D E R PER SHRI N.S. SAINI, ACCOUNTANT MEMBER: THESE ARE THE APPEALS FILED BY THE ASSESSEES AGAINS T SEPARATE ORDERS OF COMMISSIONER OF INCOME TAX (APPE ALS)-II, AHMEDABAD, BOTH DATED 13.12.2010. IT(SS)A NOS. 151 & 159/AHD/2011 AMIT N. KAPADIA & GEETABEN N. KAPADIA FOR A.Y. 2006-07 - 2 - 2. THE SOLE ISSUE INVOLVED IN BOTH THE APPEALS IS THAT THE COMMISSIONER OF INCOME TAX (APPEALS) ERRED IN CONFI RMING THE ADDITION MADE BY THE ASSESSING OFFICER OF RS 15,73, 515/- IN THE CASE OF SHRI AMIT N. KAPADIA AND RS 20,55,587/- IN THE C ASE OF SMT. GEETABEN N. KAPADIA ON ACCOUNT OF UNEXPLAINED INVES TMENT IN BANK ACCOUNT. 3. IN ITA(SS) NO. 151/AHD/2011, THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSING OFFICER OBSERVED THAT THE AS SESSEE SHRI AMIT N. KAPADIA HAS MADE INVESTMENT IN FOLLOWING ACCOUNT S IN CENTURION BANK LTD., SURAT AS UNDER: A/C NO. FINANCIAL YEAR PEAK BALANCE 0041-097730-020 2005-06 10,01,000 0041-097695-020 2005-06 5,01,000 0041-094206-001 2005-06 71,515 TOTAL 15,73,515 WHICH IS NOT RECORDED IN THE BOOKS OF ACCOUNT MAINT AINED BY THE ASSESSEE. THEREFORE, HE ADDED THE SAME U/S. 69 OF THE ACT AS GIFS RECEIVED BY THE ASSESSEE. 4. ON APPEAL, THE COMMISSIONER OF INCOME TAX (APPE ALS) CONFIRMED THE ADDITION MADE BY THE ASSESSING OFFICE R BY OBSERVING AS UNDER: 4.2 I HAVE CONSIDERED THE FACTS AND THE SUBMISSION S. IN RESPECT OF GIFT RECEIVED, FROM THE COPY OF INCOME-T AX RETURN FILED, IT IS SEEN THAT THE DONORS HAVE VERY LOW INC OME AND ALSO COPY OF THE BANK ACCOUNT WAS NOT FILED FROM WHICH T HE LOAN WAS GIVEN. HENCE, THE CREDITWORTHINESS IS NOT PROVE D. FOR UNRECONCILED SALES AS THE APPELLANT HAS NOT GIVEN A NY DETAILS, THE ASSESSING OFFICER IS JUSTIFIED IN MAKING THE AD DITIONS. IN RESPECT OF LOANS, I FIND THAT THE APPELLANT HAS NOT PROVED THE GENUINENESS OF THE TRANSACTION AND ALSO NOT PROVED THE IDENTITY AND THE CREDITWORTHINESS OF THE DEPOSITORS . ALTHOUGH THE APPELLANT'S SUBMISSIONS THAT IT WAS LOAN AND NO T THE GIFT, IS CORRECT BUT HE HAS HOT PROVED THE CREDITWORTHINESS OF THE IT(SS)A NOS. 151 & 159/AHD/2011 AMIT N. KAPADIA & GEETABEN N. KAPADIA FOR A.Y. 2006-07 - 3 - CREDITORS. THE APPELLANT HAS NOT SUBMITTED THE COPY OF THE BANK ACCOUNT AND ANY EVIDENCE REGARDING CREDITWORTH INESS. MONEY HAS NOT COME FROM FOREIGN ACCOUNT BUT THE DEM AND DRAFTS HAVE BEEN ISSUED AGAINST THE PAYMENT IN CASH IN INDIA AND IT IS NOT SHOWN HOW THE AMOUNT CAME FROM DUBAI TO INDIA. FURTHER, THE; BANK ACCOUNT IN WHICH THE AMOUNT IS D EPOSITED WAS NOT REFLECTED IN THE INCOME-TAX RETURN OF THE A PPELLANT. APART-FROM THE CONFIRMATION, NO OTHER EVIDENCE WAS FILED WITH RESPECT TO THEIR IDENTITY, PERMANENT ADDRESS, NATUR E OF BUSINESS, SOURCE OF INCOME, MODE OF TRANSFER OF MON EY FROM ABROAD TO INDIA/MOVEMENT OF MONEY THROUGH BANKING C HANNEL AND GENUINENESS OF THE CLAIM THAT DRAFT FOUND DEPOS ITED IN THE APPELLANT'S BANK ACCOUNT WERE ACTUALLY THAT TRANSFE RRED FROM THE SAID LENDER'S BANK ACCOUNT. IN VIEW OF THESE FA CTS, IT IS HELD THAT THE ADDITION IS JUSTIFIED AND THE APPELLANT'S GROUND IS REJECTED. 5. SIMILARLY, IN ITA(SS) NO. 159/AHD/2011 THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSING OFFICER OBSERVED TH AT THE ASSESSEE SMT. GEETABEN N. KAPADIA HAS RECEIVED INVESTMENT IN HER ACCOUNTS WITH CENTURION BANK LTD., SURAT AS UNDER: A/C NO. FINANCIAL YEAR PEAK BALANCE 0041-097733-020 2005-06 10,01,000 0041-093100-001 2005-06 2,02,067 0041-097708-051 2005-06 5,53,587 0041-097680-020 2005-06 5,01,000 TOTAL 22,57,654 WHICH IS NOT RECORDED IN THE BOOKS OF ACCOUNT MAINT AINED BY THE ASSESSEE. THEREFORE, HE ADDED THE SAME U/S. 69 OF THE ACT AS GIFS RECEIVED BY THE ASSESSEE. 6. ON APPEAL, THE COMMISSIONER OF INCOME TAX (APPE ALS) CONFIRMED THE ADDITION MADE BY THE ASSESSING OFFICE R BY OBSERVING AS UNDER: 4.2 I HAVE CONSIDERED THE FACTS AND THE SUBMISSION S. FOR UNRECONCILED SALES AND PAST SAVINGS, AS THE APPELLA NT HAS NOT GIVEN ANY DETAILS, HENCE, THE ASSESSING OFFICER IS JUSTIFIED IN MAKING THE ADDITIONS. IN RESPECT OF LOANS, I FIND T HAT THE IT(SS)A NOS. 151 & 159/AHD/2011 AMIT N. KAPADIA & GEETABEN N. KAPADIA FOR A.Y. 2006-07 - 4 - APPELLANT HAS NOT PROVED THE GENUINENESS OF THE TRA NSACTION AND ALSO NOT PROVED THE IDENTITY AND THE CREDITWORT HINESS OF THE DEPOSITORS. ALTHOUGH THE APPELLANT'S SUBMISSION S THAT IT WAS LOAN AND NOT THE GIFT IS CORRECT BUT HE HAS NOT PROVED THE CREDITWORTHINESS OF THE CREDITORS. THE APPELLANT HA S NOT SUBMITTED THE COPY OF THE BANK ACCOUNT AND ANY EVID ENCE REGARDING CREDITWORTHINESS. MONEY HAS NOT COME FRO M FOREIGN ACCOUNT PUT THE DEMAND DRAFTS HAVE BEEN ISSUED AGAI NST THE PAYMENT IN CASH IN INDIA AND IT IS NOT SHOWN HOW TH E AMOUNT CAME FROM DUBAI TO INDIA. FURTHER, THE BANK ACCOUNT IN WHICH THE AMOUNT IS DEPOSITED WAS NOT REFLECTED IN THE IN COME-TAX RETURN OF THE APPELLANT. APART FROM THE CONFIRMATI ON, NO OTHER EVIDENCE WAS FILED WITH RESPECT TO THEIR IDENTITY, PERMANENT ADDRESS, NATURE OF BUSINESS, SOURCE OF INCOME, MODE OF TRANSFER OF MONEY FROM ABROAD TO INDIA/MOVEMENT OF MONEY THROUGH BANKING CHANNEL AND GENUINENESS OF THE CLAI M THAT DRAFTS FOUND DEPOSITED IN THE APPELLANT'S BANK ACCO UNT WERE ACTUALLY THAT TRANSFERRED FROM THE SAID LENDER'S BA NK ACCOUNT. IN VIEW OF THESE FACTS, IT IS HELD THAT THE ADDITIO N IS JUSTIFIED AND THE APPELLANT'S GROUND IS REJECTED. 7. THE AUTHORIZED REPRESENTATIVE OF THE ASSESSEE S UBMITTED THAT THE AMOUNTS IN QUESTION FOR WHICH THE ADDITION HAS BEEN MADE BY THE ASSESSING OFFICER WERE RECEIVED BY THE ASSES SEES IN FINANCIAL YEAR 2004-05 RELEVANT TO THE ASSESSMENT YEAR 2005-0 6 AND THEREFORE NO ADDITION CAN BE MADE IN THE HANDS OF T HE ASSESSEE IN THE PRESENT YEAR OF ASSESSMENT. FOR THIS, HE PLACE D RELIANCE ON THE DECISION OF THIS BENCH OF THE TRIBUNAL IN THE CASE OF SMT. PREMILABEN A. JARIWALA VS. ACIT IN ITA NO. 155/AHD/2011 ORDER DATED 04.04.2014, WHEREIN SIMILAR DISALLOWANCE WAS DELETE D. 8. THE DEPARTMENTAL REPRESENTATIVE COULD NOT CONTR OVERT THE ABOVE SUBMISSIONS OF THE AUTHORIZED REPRESENTAT IVE OF THE ASSESSEE. 9. AFTER CONSIDERING THE RIVAL SUBMISSIONS AND PER USING THE MATERIAL ON RECORD, WE FIND THAT IN THE CASE OF SHR I AMIT N. KAPADIA, THE AUTHORIZED REPRESENTATIVE OF THE ASSESSEE POINT ED OUT FROM PAGE IT(SS)A NOS. 151 & 159/AHD/2011 AMIT N. KAPADIA & GEETABEN N. KAPADIA FOR A.Y. 2006-07 - 5 - NO. 26 OF THE PAPER BOOK WHEREIN BANK STATEMENT OF CENTURION BANK LTD., SURAT FOR ACCOUNT NO. 0041097695020 IS PLACE D, THAT THE SUM OF RS 5 LAKHS WAS RECEIVED ON 12.08.2004 AND RS 1,0 00/- WAS THE CASH DEPOSIT MADE BY THE ASSESSEE ON 07.08.2004, LE ADING TO A CREDIT BALANCE OF RS 5,01,000/-. FURTHER, HE POINT ED OUT FROM PAGE NO. 32 OF THE PAPER BOOK WHEREIN BANK STATEMENT OF CENTURION BANK LTD., SURAT FOR ACCOUNT NO. 0041097730020 THAT AN AMOUNT OF RS 5 LAKHS WAS CREDITED ON 17.08.2004 AND ANOTHER RS 5 L AKHS WAS CREDITED ON 24.08.2004 AND RS 1,000/- WAS THE CASH DEPOSIT MADE ON 16.08.2004, TOTALLING TO RS 10,01,000/-. FURTHER, HE POINTED OUT FROM PAGE NO. 38 OF THE PAPER BOOK WHEREIN BANK STA TEMENT OF CENTURION BANK LTD., SURAT FOR ACCOUNT NO. 00409420 6001 IS PLACED, THAT RS 70,455/- WAS THE CREDIT BALANCE AS ON 01.04 .2004 AND RS 1,060/- WAS THE INTEREST CREDITED IN THE ACCOUNT, T OTALLING TO RS 71,515/-. HE THEREFORE SUBMITTED THAT THE TOTAL DEPOSIT OF RS 15,73,515/- WAS RECEIVED IN THE FINANCIAL YEAR 2004 -05 RELEVANT TO THE ASSESSMENT YEAR 2005-06 AND NO ADDITION FOR THE SAME CAN BE MADE IN THE ASSESSMENT YEAR 2006-07. THIS FACT HAS NOT BEEN CONTROVERTED BY THE DEPARTMENTAL REPRESENTATIVE DUR ING THE COURSE OF THE HEARING. 10. SIMILARLY, IN THE CASE OF SMT. GEETABEN N. KAP ADIA, THE AUTHORIZED REPRESENTATIVE OF THE ASSESSEE POINTED O UT THAT AT PAGE NO. 26 OF THE PAPER BOOK IS PLACED THE BANK STATEME NT OF CENTURION BANK LTD., SURAT FOR ACCOUNT NO. 0041097733020 FROM WHICH IT WILL BE FOUND THAT THERE WAS DEPOSIT OF RS 5 LAKHS ON 17 .08.2004 AND ANOTHER DEPOSIT OF RS 5 LAKHS ON 24.08.2004 AND THE RE WAS CASH DEPOSIT OF RS 1,000/- ON 16.08.2004, TOTALLING TO R S 10,01,000/-. FURTHER, AT PAGE NO. 32 OF PAPER BOOK IS PLACED BAN K STATEMENT OF CENTURION BANK LTD., SURAT FOR ACCOUNT NO. 00410977 08051 IT(SS)A NOS. 151 & 159/AHD/2011 AMIT N. KAPADIA & GEETABEN N. KAPADIA FOR A.Y. 2006-07 - 6 - WHEREFROM IT WILL BE FOUND THAT RS 5,51,000/- WAS C REDITED ON 18.08.2004 AND RS 1,000/- WAS CASH DEPOSIT MADE ON 16.08.2004 AND THERE WAS CREDIT OF INTEREST OF RS 1,587/- ON 0 4.10.2004, TOTALLING TO RS 5,53,587/-. FURTHER, AT PAGE NO. 3 8 OF THE PAPER BOOK IS PLACED THE BANK STATEMENT OF CENTURION BANK LTD. , SURAT FOR ACCOUNT NO. 0041097680020 FROM WHICH IT WILL BE OBS ERVED THAT RS 1,000/- WAS THE CASH DEPOSIT MADE ON 07.08.2004 AND THERE WAS A DEPOSIT OF RS 5 LAKHS ON 12.08.2004, TOTALLING TO R S 5,01,000/-. IT WAS HIS SUBMISSION THAT TOTAL DEPOSIT IN THE BANK S TATEMENT WAS RS 20,55,587/- WHICH WAS MADE IN THE FINANCIAL YEAR 2 004-05 RELEVANT TO ASSESSMENT YEAR 2005-06. HENCE, NO ADDITION CAN BE MADE IN THE PRESENT ASSESSMENT YEAR 2006-07. 11. ON THE ABOVE FACTS, WE FIND THAT THE ISSUE IS SQUARELY COVERED BY THE DECISION OF THIS BENCH OF THE TRIBUN AL IN THE CASE OF SMT. PREMILABEN A. JARIWALA VS. ACIT (SUPRA) WHEREI N THE TRIBUNAL HELD AS UNDER: AT THE TIME OF HEARING LEARNED COUNSEL OF THE ASSES SEE AT THE OUTSET SUBMITTED THAT THE DEPOSITS AMOUNTING TO RS10,43,994/- IN THE ACCOUNT WERE MADE BY ASSESSEE DURING THE ASSESSMENT YEAR 2005-06 AND THEREFORE ADDITION CANNOT BE MADE DURING THE YEAR UNDER APPEAL. CONCLUDING TH E ARGUMENT, LEARNED COUNSEL OF THE ASSESSEE SUBMITTED THAT THE ADDITIONS SO MADE BY AO AND SUSTAINED BY THE LD. CI T(A) MAY KINDLY BE DELETED. LD. DR ON THE OTHER HAND RELIED ON THE ORDER OF THE LOWER AUTHORITIES. 7. AFTER HEARING BOTH THE PARTIES AND PERUSING THE RECORD PARTICULARLY PAGE NO. 48 AND 49 OF THE PAPER BOOK, WE AGREE WITH THE CONTENTIONS OF THE LEARNED COUNSEL OF THE ASSESSEE THAT THESE DEPOSITS WERE MADE IN THE SAID BANK ACCO UNT DURING THE ASSESSMENT YEAR 2005-06 AND THEREFORE ADDITION CANNOT BE MADE DURING THE YEAR UNDER APPEAL FOR UNEXPLAINE D INVESTMENT. THE ADDITION SO MADE AND SUSTAINED BY L D. CIT(A) IS HEREBY DELETED. AO HOWEVER WILL BE AT LIBERTY T O TAKE COGNIZANCE OF THESE DEPOSITS FOR ASSESSMENT YEAR 20 05-06 AS PER LAW. THIS GROUND OF THE ASSESSEE IS ALLOWED. IT(SS)A NOS. 151 & 159/AHD/2011 AMIT N. KAPADIA & GEETABEN N. KAPADIA FOR A.Y. 2006-07 - 7 - 12. RESPECTFULLY FOLLOWING THE ABOVE QUOTED DECI SION OF THE TRIBUNAL, WE SET ASIDE THE ORDERS OF LOWER AUTHORIT IES AND DELETE THE ADDITION OF RS 15,73,515/- IN THE CASE OF SHRI AMIT N. KAPADIA AND RS 20,55,587/- IN THE CASE OF SMT. GEETABEN N. KAPA DIA BY HOLDING THAT THE DEPOSITS WERE MADE IN THE SAID BANK ACCOUN TS DURING THE ASSESSMENT YEAR 2005-06 AND THEREFORE ADDITION CANN OT BE MADE DURING THE YEAR UNDER APPEAL FOR UNEXPLAINED INVEST MENT. HOWEVER, THE ASSESSING OFFICER WILL BE AT LIBERTY TO TAKE CO GNIZANCE OF THESE DEPOSITS IN THE ASSESSMENT YEAR 2005-06 AS PER LAW. FURTHER, WE OBSERVE THAT IN THE CASE OF SMT. GEETABEN N. KAPADI A, THE AUTHORIZED REPRESENTATIVE OF THE ASSESSEE HAS MADE ABSOLUTELY NO SUBMISSIONS FOR THE ADDITIONS MADE IN THE FOLLOWING BANK ACCOUNT: A/C NO. FINANCIAL YEAR PEAK BALANCE 0041-093100-001 2005-06 2,02,067 THEREFORE, WE CONFIRM THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS) IN RESPECT OF THE ADDITION OF RS 2,02,067 /-. THUS, THE APPEAL IN THE CASE OF SHRI AMIT N. KAPADIA IS ALLOW ED AND THE APPEAL IN THE CASE OF SMT. GEETABEN N. KAPADIA IS PARTLY A LLOWED. 13. IN THE RESULT, THE ASSESSEES APPEAL IN IT(SS) A NO. 151/AHD/2011 IS ALLOWED WHEREAS THE ASSESSEES APPE AL IN IT(SS)A NO. 159/AHD/2011 IS PARTLY ALLOWED. ORDER PRONOUNCED IN THE COURT ON FRIDAY, THE 19 TH OF SEPTEMBER, 2014 AT AHMEDABAD. SD/- SD/- (G.C. GUPTA) VICE PRESIDENT ( N.S. SAINI) ACCOUNTANT MEMBER AHMEDABAD; DATED /09/2014 GHANSHYAM MAURYA, SR. P.S.