Smt. Krishna Sharma, Bhopal V. The ACIT 1(2), Bhopal

ITSSA 34/IND/2013

• Counselvise Citation: [2013] 121 COUNSELVISE.COM (IT) 9191 (ITAT-INDORE)
• Duration Of Justice: 2 month(s) 18 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 23-05-2013
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2000-2001
• Appeal Filed On: 06-03-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: R A VERMA
• Assessee Lawyers: H P VERMA; SAKSHI VERMA
• Keywords: Unexplained investment
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL , INDORE BENCH, INDORE BEFORE SHRI JOGINDER SINGH, J.M. AND SHRI R.C.SHARM A, A.M. PAN NO. : ACUPS4898Q I.T(SS).A.NO.34 /IND/201 3 A.Y. : 2000-01 SMT.KRISHNA SHARMA, E-5/137, ARERA COLONY, BHOPAL VS. ACIT, 1(2), BHOPAL APPELLANT RESPONDENT APPELLANT BY : SHRI H.P.VERMA, ADV. AND MS.SAKSHI VERMA, C. A. RESPONDENT BY : SHRI R.A.VERMA, SR. DR DATE OF HEARING : 21 . 0 5 .201 3 DATE OF PRONOUNCEMENT : 23 . 0 5 .201 3 O R D E R PER R. C. SHARMA, A.M. THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER PASSED BY THE CIT(A) DATED 14TH DECEMBER, 2012, FOR THE ASSESSMENT YEAR 2000-01 IN THE MATTER OF ORDER PASS ED U/S 153C R/W SECTION 143(3) OF THE INCOME-TAX ACT, 1961 . -: 2: - 2 2. THE ONLY GRIEVANCE OF THE ASSESSEE RELATES TO CONFIRMING ADDITION OF RS. 40,000/- OUT OF OPENING CASH BALANCE SHOWN BY THE ASSESSEE AT RS. 59,160/-, WHIC H WAS ACCEPTED BY THE ASSESSING OFFICER AT RS. 19,160/-. 3. RIVAL CONTENTIONS HAVE BEEN HEARD AND RECORDS PERUSED. FACTS IN BRIEF IN BRIEF ARE THAT THE ASSE SSEE IS MEMBER OF SHARMA GROUP OF CASE WHICH IS HEADED BY S HRI SHAMBHU NATH SHARMA, WHO IS A RETIRED DSP FROM MP P OLICE. FURTHER DURING THE COURSE OF SEARCH SHRI RAMNATH SH ARMA THE SON SHRI SAMBHUNATH SHARMA THE HEAD OF SHARMA GROUP WAS EXAMINED ON OATH ON 16.09.2005 AND ALSO ON 17.09.20 05 AND WAS CONFRONTED WITH THE INCRIMINATING DOCUMENTS FOU ND DURING THE SEARCH. IN STATEMENT IN OATH SHRI RAMNAT H SHARMA OFFERED FOR TAXATION TOTAL INCOME OF RS. 1.83 CRORE ON ACCOUNT OF UNEXPLAINED INVESTMENT ON VARIOUS PLOTS ACQUIRED BY THE FAMILY MEMBERS DISCLOSING THE LESSER VALUE AND ALSO ON ACCOUNT OF UNRECORDED PAYMENT AND INVESTMENT. IN T HE RETURN OF INCOME FILED, THE ASSESSEE SMT. KRISHNA SHARMA H AS SHOWN TOTAL INCOME AT RS. 1,59,871/- WHICH CONSIST OF SAL ARY INCOME FROM HARE KRISHNA COLONIZERS PVT.LTD. RS. 33,333/-, RENTAL -: 3: - 3 INCOME AT RS. 79,384/- AND MISCELLANEOUS INCOME OF RS. 35,000/-. DURING THE ASSESSMENT PROCEEDING ASSESSEE FILED STATEMENT OF AFFAIRS ALONGWITH THE RECEIPT AND PAYM ENT ACCOUNT AND INCOME EXPENDITURE ACCOUNT. ON THE PERU SAL OF THESE ACCOUNT AND STATEMENT AND RETURN OF INCOME FI LED BY THE ASSESSEE, THE ASSESSING OFFICER OBSERVED THAT THE A SSESSEE HAS SHOWN CASH IN HAND AT RS. 59,160/- AS ON 1.4.1999, WHEREAS THE BANK BALANCE HAS BEEN SHOWN AT RS. 4,000/- ONLY IN RESPECT OF TWO BANK ACCOUNT OPERATED BY THE ASSESSE E. HOWEVER, THE A.O. ACCEPTED CASH BALANCE OF RS. 19,1 60/- AND BALANCE OF RS. 40,000/- WAS ADDED IN ASSESSEES INC OME. BY THE IMPUGNED ORDER, CIT(A) CONFIRMED THE ASSESSING OFFICES ACTION AGAINST WHICH ASSESSEE IS IN FURTHER APPEAL BEFORE US. 4. IT WAS CONTENDED BY THE LD. AUTHORIZED REPRESENTAT IVE THAT - THE LD. ASSESSING OFFICER/CIT(A) DID NOT TAKE INTO CONSIDERATION THAT THE OPENING CASH IN HAND AS ON 31.3.1997 WAS RS. 2,035/- ONLY. -: 4: - 4 - THAT, THEREAFTER THE ENTRIES IN THE CASH FLOW STATE MENTS HAVE BEEN ACCEPTED BY THE LD. ASSESSING OFFICER/CIT (A) AS THESE ARE VERIFIABLE. - THAT THE INCOMINGS AND OUTGOINGS MADE THE CASH IN HAND AS ON 31.03.1999 AT RS. 59,160. IF THE OPENIN G BALANCE AS ON 31.3.1997 IS ACCEPTABLE, THE CLOSING ON 31.3.1999 CANNOT BE REJECTED. (B) THE LD. CIT(A) WRITES THAT THIS CASH-FLOW WAS P REPARED AFTER SEARCH. EXCEPT THE CASH-IN-HAND RS. 2.035 AS ON 01.04.97 ALL THE OTHER ENTRIES IN THE CASH FLOW ARE VERIFIABLE BY COPIES OF DOCUMENTS FILED BY THE APPE LLANT BEFORE THE LD. ASSESSING OFFICER/CIT(A). (C) THE INVESTMENTS IN M/S. RAM ENTERPRISES FOR BOT H THE YEARS ARE SHOWN IN THE STATEMENTS. (D) THE BANK ACCOUNTS HAVE BEEN FILED BEFORE THE LD . AUTHORITIES BELOW. FROM THE BANK OF INDIA ON 30-03- 99, CASH OF RS. 11,000 WAS WITHDRAWN. (E) IT IS A KNOWN FACT THAT HOUSE LADIES IN INDIA K EEP MONEY WITH THEM OUT OF RECEIPTS FROM FAMILY MEMBERS . HENCE, THE CASH AS SHOWN IS NOT UNREASONABLE. (F) A LADY HAVING INVESTMENT OF RS. 6,99,392/- IN M /S. RAM ENTERPRISES AS ON 31.03.1999 CAN DEFINITELY HAV E CASH IN HAND AS SHOWN. SHE FILED HER RETURN FOR THI S YEAR SHOWING INCOME OF RS. 1,59,871/-. -: 5: - 5 5. ON THE OTHER HAND, THE LD. SENIOR DR RELIED ON O RDER OF LOWER AUTHORITIES AND CONTENDED THAT ASSESSEE COULD NOT SUBSTANTIATE THE OPENING CASH BALANCE. THEREFORE, T HE ASSESSING OFFICER HAS ACCEPTED CASH BALANCE OF RS. 19,160/- IN PLACE OF CASH BALANCE SHOWN BY THE ASSESSEE AT RS.5 9,160/-. 5. WE HAVE CONSIDERED THE RIVAL CONTENTIONS AND GONE THROUGH THE ORDERS OF THE LOWER AUTHORITIES. FROM T HE RECORD, WE FOUND THAT DURING THE COURSE OF ASSESSMENT PROCE EDINGS, FOR THE ASSESSMENT YEAR UNDER CONSIDERATION, THE AS SESSEE HAS FURNISHED CASH FLOW STATEMENT IN SUPPORT OF OPENING CASH BALANCE OF RS. 59,160/- AS ON 31.3.1999. BANK STATE MENT WAS ALSO FURNISHED, WHICH INDICATED BALANCE OF RS. 4000 /-. ON THE BASIS OF BANK BALANCE OF RS. 4000/-, THE ASSESSING OFFICER STATED THAT TAKING A WHOLESOME VIEW CASH TO THE EXT ENT OF RS. 19,160/- WAS JUSTIFIED. ACCORDINGLY, HE MADE AN ADD ITION OF RS. 40000/- BY REJECTING ASSESSEES CLAIM OF CASH B ALANCE OF RS. 59,160/-. 6. BY THE IMPUGNED ORDER, THE LD. CIT(A) CONFIRMED THE ADDITION BY OBSERVING THAT CASH FLOW STATEMENTS WER E PREPARED AFTER THE DATE OF SEARCH JUST TO EXPLAIN THE SOURCE OF OPENING -: 6: - 6 CASH IN HAND. THEREFORE, SUCH CASH FLOW STATEMENT C ANNOT BE RELIED. AGAINST THIS ORDER OF CIT(A), THE ASSESSEE IS IN FURTHER APPEAL BEFORE US. 7. THE LD. AUTHORIZED REPRESENTATIVE DREW OUR ATTENTIO N TO THE CASH FLOW STATEMENT FILED BEFORE THE ASSESSI NG OFFICER FOR THE PERIOD 1.4.1997 TO 31.3.1998 AND FOR 1.4.1998 T O 31.3.1999. IN THE CASH FLOW STATEMENT, THE ASSESSEE HAD SHOWN OPENING CASH BALANCE OF RS. 2035/- AS ON 1.4. 1997. THEREAFTER, RECEIPT OF CASH OUT OF SALE OF LAND AND WITHDRAWALS FROM BANK WERE DULY INCORPORATED IN THE CASH FLOW S TATEMENT AND PAYMENT MADE ON ACCOUNT OF INVESTMENT MADE AND HOUSE HOLD EXPENSES WERE DULY DISCLOSED IN THE CASH FLOW STATEMENT. NO DEFECT WAS FOUND WITH RESPECT TO RECEIPTS AND PA YMENTS SHOWN IN THE CASH FLOW STATEMENT SO FURNISHED. EVEN OPENING CASH BALANCE AS ON 1.4.1997 WAS ACCEPTED. THE TRANS ACTIONS IN THE CASH FLOW STATEMENT WERE DULY VERIFIABLE SUP PORTED BY DOCUMENTARY EVIDENCE. MERELY BECAUSE CASH FLOW STAT EMENT WAS FURNISHED DURING THE COURSE OF ASSESSMENT PROCE EDINGS, THE SAME CANNOT BE IGNORED MERELY ON THE PLEA THAT IT WAS PREPARED AFTER SEARCH. NO DOUBT, IT WAS PREPARED AF TER THE -: 7: - 7 SEARCH, BUT IT INCORPORATES THE TRANSACTION ENTERED INTO BY THE ASSESSEE WHICH WERE DULY SUPPORTED BY THE DOCUMENTS PLACED ON RECORD. ONCE THE CASH FLOW STATEMENT IS FURNISHE D TO SUBSTANTIATE THE CASH BALANCE, THE SAME CANNOT BE R EJECTED WITHOUT POINTING OUT MISTAKE OR FAULT THEREIN. IT I S ALSO NOT THE CASE OF REVENUE AUTHORITIES THAT ENTRIES IN CASH FL OW STATEMENT WAS NOT SUBSTANTIATED BY DOCUMENTARY EVIDENCE. ACCO RDINGLY, WE DO NOT FIND ANY MERIT IN THE ORDERS OF LOWER AUT HORITIES FOR DISREGARDING CLOSING CASH BALANCE WORKED OUT AS PER CASH FLOW STATEMENT AT RS. 59,160/-. 8. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWE D. THIS ORDER HAS BEEN PRONOUNCED IN THE OPEN COURT ON 23 RD MAY, 2013. SD/- SD/- (JOGINDER SINGH) (R. C. SHARMA) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED :23 RD MAY, 2013. CPU* 21225