Shri Surendra Dadha, CHENNAI V. ACIT, CHENNAI

ITSSA 20/CHNY/2010

• Counselvise Citation: [2012] 124 COUNSELVISE.COM (IT) 7697 (ITAT-CHENNAI)
• Duration Of Justice: 1 year(s) 7 month(s) 12 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 09-03-2012
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Next Hearing Date: 28-02-2012
• Assessment Year: misc
• Appeal Filed On: 27-07-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ANIRUDH RAI
• Assessee Lawyers: D ANAND
• Keywords: Block assessment; Documents seized

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH, CHENNAI BEFORE SHRI ABRAHAM P. GEORGE, ACCOUNTANT MEMBER AND SHRI VIKAS AWASTHY, JUDICIAL MEMBER I.T.(SS) A. NO. 20/MDS/2010 (BLOCK ASSESSMENT PERIOD : 1.4.1988 TO 15.12.199 8) SHRI SURENDRA DADHA, NO.12, POES 4 TH STREET, TEYNAMPET, CHENNAI - 600 034. PAN : AABHS0305M (APPELLANT) V. THE ASSISTANT COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE IV(2), CHENNAI - 600 034 . (RESPONDENT) APPELLANT BY : SHRI D. ANAND, ADVOCATE RESPONDENT BY : SHRI ANIR UDH RAI, CIT-DR DATE OF HEARING : 28.02.2012 DATE OF PRONOUNCEMENT : 09.03.2012 O R D E R PER ABRAHAM P. GEORGE, ACCOUNTANT MEMBER : THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGA INST THE AN ORDER DATED 2.3.2010 OF COMMISSIONER OF INCOME TAX (APPEALS)-I, CHENNAI. 2. THE APPEAL WAS FILED WITH A DELAY OF 18 DAYS. P ETITION FOR CONDONATION WAS FILED. REASONS FOUND TO BE SATISFA CTORY. HENCE, WE CONDONE THE DAY AND ADMIT THE APPEAL. I.T.(SS) A. NO. 20/MDS/10 2 3. GRIEVANCE RAISED BY THE ASSESSEE IS AGAINST DISA LLOWANCE OF ` 5 LAKHS SUSTAINED BY LD. CIT(APPEALS) FOR DEPOSITS OF ` 3.5 LAKHS AND ` 1.5 LAKHS MADE BY THE ASSESSEE IN HIS PROPRIETORSHI P CONCERN ON 23.6.98 AND 24.6.98 RESPECTIVELY. AS PER THE ASSES SEE, THE SAID SUM WAS WITHDRAWN BY HIM IN CASH FROM HIS PROPRIETARY C ONCERN ANTRIKSH PHARMA ON 15.6.98. 4. SHORT FACTS APROPOS ARE THAT THERE WAS A SEARCH CARRIED OUT IN THE PREMISES OF ONE SHRI MAHENDRA DADHA ON 15.12.19 98 WHICH WAS CONCLUDED ON 1.6.1999. BASED ON CERTAIN MATERIALS S EIZED FROM SHRI MAHENDRA DADHA, NOTICE WAS ISSUED TO ASSESSEE UNDER SECTION 158BD OF INCOME-TAX ACT, 1962 (IN SHORT 'THE ACT') ON 27.6.2001 FOR A BLOCK PERIOD 1.4.1988 TO 15.12.1998. A RETURN WAS LATER ON FILED BY THE ASSESSEE FOR THE BLOCK PERIOD. DURING THE COUR SE OF ASSESSMENT PROCEEDINGS, ONE OF THE ITEMS CONSIDERED BY THE A.O . FOR ADDITION WAS BASED ON CERTAIN DOCUMENTS IN THE NAME OF ASSESSEE AND A PROPRIETARY CONCERN M/S ANTRIKSH PHARMA. RELYING O N CERTAIN PAGES OF DOCUMENTS SEIZED FROM THE PREMISES OF SHRI MAHEN DRA DADHA, A.O. NOTED THAT ASSESSEE HAD RECEIVED A SUM OF ` 9.85 LAKHS WHICH WAS DEPOSITED ON DIFFERENT DATES IN DIFFERENT CONCE RNS. AGAIN, AS PER THE A.O., ASSESSEE HAD DEPOSITED ` 3.5 LAKHS AND ` 1.5 LAKHS IN HIS PROPRIETARY CONCERN M/S ANTRIKSH PHARMA WITHOUT PRO PER SOURCE. I.T.(SS) A. NO. 20/MDS/10 3 CONSIDERING SEIZED RECORD, MARKED AS LOOSE SHEETS ANNEXURE G/S1, A.O. MADE AN ADDITION OF ` 21.5 LAKHS AS UNDISCLOSED INCOME OF THE ASSESSEE AMONG CERTAIN OTHER ADDITIONS, WHICH INTER ALIA INCLUDED THE SUM OF ` 5 LAKHS AS WELL. 5. IN ITS APPEAL BEFORE LD. CIT(APPEALS), SUBMISSIO N OF THE ASSESSEE WAS THAT WHEN THE SEIZED MATERIALS WERE CO NSIDERED, IT SHOULD BE TAKEN IN ITS ENTIRETY AND NOT FOR PART TR ANSACTIONS MENTIONED THEREIN. AFTER VERIFYING THE SUBMISSIONS OF THE AS SESSEE AND ALSO REMAND REPORTS OBTAINED FROM ASSESSING OFFICER, LD. CIT(APPEALS) REACHED AN OPINION THAT THE SEIZED MATERIAL REFLECT ED BOTH SOURCE OF DEPOSITS AND UTILIZATIONS. THEREFORE, ACCORDING TO HIM, SUCH AMOUNTS COULD NOT BE CONSIDERED FOR AN ADDITION. HOWEVER, DEPOSITS OF ` 3.5 LAKHS AND ` 1.5 LAKHS ON 23.6.98 AND 24.6.98 RESPECTIVELY IN TH E PROPRIETORSHIP CONCERN, AS PER LD. CIT(APPEALS), WE RE NOT PROPERLY EXPLAINED. AS PER LD. CIT(APPEALS), ASSESSING OFFI CER IN HIS REMAND REPORT HAD MENTIONED THAT WITHDRAWAL FROM THE BANK WAS MORE THAN A WEEK BEFORE THE DEPOSITS WERE MADE IN THE PROPRIETO RSHIP CONCERN AND, THEREFORE, COULD NOT BE ACCEPTED AS SOURCE FOR SUCH DEPOSITS. THUS, LD. CIT(APPEALS) DELETED THE ADDITION MADE BY THE A.O. EXCEPT FOR THE SUM OF ` 5 LAKHS. I.T.(SS) A. NO. 20/MDS/10 4 6. NOW BEFORE US, LEARNED A.R. ASSAILING THE ORDER OF LD. CIT(APPEALS) SUSTAINING THE ADDITION OF ` 5 LAKHS, SUBMITTED THAT THE SAID SUM WAS WITHDRAWN FROM ASSESSEES OWN ACCOUNT ON 15 TH JUNE, 1998. ACCORDING TO HIM, THE DEPOSIT OF THE MONEY I N THE PROPRIETORSHIP CONCERN WAS DONE ON 23 RD AND 24 TH JUNE, 1998 AND IT COULD NOT BE SAID THAT THERE WAS ANY SUBSTANTIAL TI ME GAP BETWEEN WITHDRAWAL AND DEPOSIT SO AS TO REJECT THE CONTENTI ON OF THE ASSESSEE REGARDING THE SOURCE. 7. PER CONTRA, LEARNED D.R. SUPPORTING THE ORDER OF LD. CIT(APPEALS), SUBMITTED THAT ASSESSEE WAS NOT ABLE TO MAKE ONE TO ONE CO-RELATION OF WITHDRAWAL FROM BANK AND DEPOSIT IN PROPRIETARY CONCERN. 8. WE HAVE PERUSED THE ORDERS AND HEARD THE RIVAL SUBMISSIONS. THE ISSUE BEFORE US IS REGARDING ` 5 LAKHS DEPOSITED BY THE ASSESSEE IN ITS PROPRIETARY CONCERN ON TWO DAYS, VIZ. 23 RD AND 24 TH JUNE, 1998. THE SUM DEPOSITED WAS IN TWO INSTALMENTS ` 3.5 LAKHS AND ` 1.5 LAKHS. IT IS AN ADMITTED POSITION THAT ASSESSEE HA D MADE A WITHDRAWAL OF ` 5 LAKHS FROM HIS ICICI BANK ACCOUNT ON 15.6.1998. REVENUE HAS NO CASE THAT THE DEPOSITS OF THE ASSESS EE IN ICICI BANK WAS NOT EXPLAINED. THEREFORE, ANY WITHDRAWAL FROM SUCH BANK I.T.(SS) A. NO. 20/MDS/10 5 ACCOUNT COULD RIGHTLY BE CLAIMED BY THE ASSESSEE AS SOURCE FOR INVESTMENT UNLESS AND UNTIL SUCH INVESTMENTS WERE M ADE IN SUCH A DISTANCE POINT OF TIME TO TAKE IT OUT OF PREPONDERA NCE OF PROBABILITY. THE MONEY HERE WAS NOT KEPT IDLE FOR A LONG PERIOD. THE GAP BEING LESS THAN ONE MONTH, WE CANNOT SAY THAT IT WAS SUCH A SUBSTANTIAL DELAY SO AS TO WARRANT A CONCLUSION THAT ASSESSEE H AD UTILIZED THE MONEY FOR SOMETHING ELSE. THE EXPLANATION GIVEN BY THE ASSESSEE IF TESTED FROM THE RULE OF PREPONDERANCE AND PROBABILI TY IS ACCEPTABLE. WE ARE UNABLE TO UNDERSTAND WHAT THE REVENUE MEANS BY ONE TO ONE CO-RELATION. ASSESSEE HAD WITHDRAWN THE SUM AND DE POSITED IT IN HIS PROPRIETORSHIP CONCERN IN TWO INSTALMENTS. SOURCE IS WELL EXPLAINED AND THE ADDITION WAS NOT WARRANTED. ORDERS OF LOWE R AUTHORITIES ARE SET ASIDE. ADDITION IS DELETED. 9. IN THE RESULT, APPEAL FILED BY THE ASSESSEE IS A LLOWED. THE ORDER WAS PRONOUNCED IN THE COURT ON 9 TH MARCH, 2012. SD/- SD/- (VIKAS AWASTHY) (ABRAHAM P. GEORGE) JUDICIAL MEMBER ACCOUNTANT MEMBER CHENNAI, DATED THE 9 TH MARCH, 2012. KRI. COPY TO: APPELLANT/RESPONDENT/CIT(A)-I, CHENNAI-34/ CIT, CENTRAL-I, CHENNAI/D.R./GUARD FILE