THE DCIT, CENTRAL-1, Indore V. SHRI DEEPAK KALRA, Indore

ITSSA 68/IND/2016

• Counselvise Citation: [2017] 122 COUNSELVISE.COM (IT) 2885 (ITAT-INDORE)
• Duration Of Justice: 8 month(s) 5 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 17-01-2017
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 05-01-2017
• Assessment Year: 2011-2012
• Appeal Filed On: 12-05-2016
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: LALCHAND
• Keywords: Unexplained cash credit; Gift
• Section: 143(3); 153A; 131; 68

Judgement Text

SHRI DEEPAK KLARA / I.T.A. NO.SS68 /IND/2016/A.Y.:1 1-12 PAGE 1 OF 4 , , IN THE INCOME TAX APPELLATE TRIBUNAL, INDORE BENCH, INDORE . . , . . , ' BEFORE SHRI D.T. GARASIA, JUDICIAL MEMBER AND SHRI O.P. MEENA, ACCOUNTANT MEMBER DCIT CENTRAL CIRCLE-1 INDORE VS. SHRI DEEPAK KALRA 6 SHRIRAM NAGAR INDORE / APPELLANT / RESPONDENT . . ./ PAN: ALGPK 9075L / APPELLANT BY SHRI LAL CHAND CIT (DR) / RESPONDENT BY SHRI SATNAM SINGH SHEETAL, ADVOCATE / DATE OF HEARING 05.01.2017 / DATE OF PRONOUNCEMENT 17.01.2017 / O R D E R PER O.P. MEENA, ACCOUTANT MEMEBR. 1. THIS APPEAL IS FILED BY THE ASSESSEE AGAINST THE OR DER OF LD. COMMISSIONER OF INCOME TAX (APPEALS)-I, INDORE [HEREINAFTER REFERRED TO AS THE CIT (A)] DATED 29.02.2016. THIS APPEAL PERTAINS TO ASSESSMENT YEAR 2011-12 AS AGAINST APPE AL DECIDED IN RESPECT OF ASSESSMENT ORDER DATED 24.03.2015 PASSED U/S. 153A READ WITH S ECTION 143(3) OF INCOME TAX ACT, 1961(HEREIN AFTER REFERRED TO AS 'THE ACT) BY THE D CIT CENTRAL CIRCLE 1, INDORE [HEREINAFTER REFERRED TO AS THE AO]. THE REVENUE HAS TAKEN FOLL OWING GROUNDS OF APPEAL:- . . /. I.T.A. NO.SS68/IND/2016 $ $ / ASSESSMENT YEAR:2011-12 SHRI DEEPAK KLARA / I.T.A. NO.SS68 /IND/2016/A.Y.:1 1-12 PAGE 2 OF 4 ON THE FACTS AND IN CIRCUMSTANCES OF THE CASE, THE LD. CIT (A) ERRED IN DELETING THE ADDITION MADE BY THE AO OF RS. 1,50,00,000/- ON ACC OUNT OF UNEXPLAINED CASH CREDIT UNDER SECTION 68 OF INCOME TAX ACT,1961 WITHOUT AP PRECIATING THE FACTS AND EVIDENCES BROUGHT INTO LIGHT BY THE AO DURING ASSES SMENT PROCEEDINGS. 2. SUCCINCTLY, FACTS AS CULLED OUT FROM THE ORDERS OF LOWER AUTHORITIES ARE THAT THE ASSESSEE IS INDIVIDUAL AND BELONGED TO APOLLO GROUP IN WHICH SE ARCH AND SEIZURE OPERATION WAS CARRIED ON 21.09.2012. WHILE MAKING ASSESSMENT, THE AO NOTI CED THAT THE ASSESSEE HAS TAKEN GIFTS OF RS. 25,00,000/- VIDE CHEQUE NO. 756015 DTD. 25.1 1.2010, RS. 25,00,000/- VIDE CHEQUE NO. 756016 DTD. 25.11.2010, RS. 50,00,000/- VIDE CHEQUE NO. 756017 DTD. 26.11.2010 AND RS. 50,00,000/- VIDE CHEQUE NO. 756023 DTD. 30.11.2010 ALL OF UNION BANK OF INDIA, AGGREGATING TO RS.1,50,00,000/- FROM SMT. MAYA SACHDEVA. SIMIL ARLY, OTHER FAMILY MEMBERS NAMELY SMT. DRAUPADI KALRA AND SMT. KANGANA KALRA HAVE ALSO TAK EN GIFTS AMOUNTING TO RS. 2,90, 00,000/- (INCLUDING OF THE ASSESSEE) FROM SMT. MAYA SACHDEV. IN ORDER TO VERIFY THE IDENTITY, GENUINENESS AND CREDITWORTHINESS OF THE DONOR, SUMM ONS UNDER SECTION 131 OF THE ACT DTD. 02.03.2015 ISSUED TO SMT. MAYA SACHDEV ASKING HER T O APPEAR PERSONALLY BEFORE THE AO WITH CERTAIN DETAILS. HOWEVER, SMT. MAYA SACHDEV DID NOT APPEAR PERSONALLY BUT SUBMITTED SOME DETAILS THROUGH HER A.R. . THE AO EXAMINED THE DETA ILS AND NOTED THAT WHEN THE SMT. MAYA SACHDEV WHO IS 70 YEARS OF OLD IS DOING BUSINESS, T HEREFORE, THERE COULD NOT BE ANY DIFFICULTY TO APPEAR BEFORE THE AO. IT WAS CLAIMED THAT SHE H AD FOUR SONS, BUT RESIDING ALONE AND SHRI NANKRAM IS LOOKING AFTER HER. HER CHILDREN ARE INDU LGED IN BAD HABITS; THEREFORE, SHE DECIDED TO GIVE AWAY HER MONEY TO THE ASSESSEE AND HIS FAMI LY AS GIFTS. HOWEVER, THE AO DID NOT SATISFACTORY WITH SUBMISSION, AS SMT. MAYA SACHDEV DID NOT APPEAR PERSONALLY BEFORE HIM. THE AO FURTHER NOTED THAT HER BALANCE SHEET AS ON 01.04.2007 SHOWED CAPITAL AT RS. 2,84,48,258/- WHICH SUDDENLY INCREASED TO RS. 2,96, 30,350/- AS ON 31.03.2010. OUT OF THIS SHRI DEEPAK KLARA / I.T.A. NO.SS68 /IND/2016/A.Y.:1 1-12 PAGE 3 OF 4 SHE HAD MADE GIFTS OF RS. 2,90,00,000/- LEAVING A P ALTRY SUM OF RS. 9,64,775/- FOR REST OF HER LIFE. THIS SUDDEN INCREASE AND FOR PARTING AWAY SUC H BIG AMOUNT BY WAY OF BY WAY OF GIFTS IS NOT UNDERSTANDABLE. THE AO ALSO OBSERVED THAT SHE D ID NOT FURNISH BANK ACCOUNT FOR THE PERIOD FROM 01.04.2007 TO 31.03.2013. ACCORDINGLY, IN VIEW OF REASONS AS DISCUSSED IN ASSESSMENT ORDER , THE AO HELD THAT GIFTS IS NOT PR OVED TO BE GENUINE AS IDENTITY, GENUINENESS AND CREDITWORTHINESS IS NOT ESTABLISHED . ACCORDINGLY ADDITION OF RS. 1,50,00,000/- WAS MADE UNDER SECTION 68 OF THE ACT. 3. BEING, AGGRIEVED THE ASSESSEE FILED AN APPEAL BEFOR E THE LD. CIT (A). DURING THE COURSE OF APPELLATE PROCEEDINGS, LD. CIT (A) HAD ISSUED SUMMO NS UNDER SECTION 131 OF THE ACT TO SMT. MAYA SACHDEV FOR HER PERSONAL APPEARANCE AND SHE WA S APPEARED AND EXAMINED BY LD. CIT (A). THE AO WAS ALSO ASKED FOR CROSS-EXAMINATION TH E DONOR, BUT THE AO DID NOT AVAIL THE OPPORTUNITY BEING ALLOWED TO HIM BY THE LD. CIT (A) . THE LD. CIT (A) THAT SMT. MAYA SACHDEV WAS OLD LADY HENCE, SHE COULD NOT HANDLE HER BUSINE SS, SHE ALSO GIVE LOANS TO FAMILY MEMBERS OF THE ASSESSEE , HENCE, HER CREDITWORTHINE SS HAS BEEN ESTABLISHED. THUS, LD. CIT (A) CONCLUDED THAT IDENTITY, GENUINENESS AND CREDIT WORTHINESS OF DONOR IS ESTABLISHED, HENCE, LD. CIT (A) DELETED THE ADDITION MADE BY THE AO. 4. BEING, AGGRIEVED THE REVENUE HAS FILED THIS APPEAL BEFORE THE TRIBUNAL. THE LD. D.R. SUBMITTED THAT SMT. MAYA SACHDEV DID NOT APPEAR BEF ORE THE AO ON THE PRETEXT OF HER OLD AGE BUT SHE APPEARED BEFORE THE LD. CIT (A). HENCE, THE AO WAS DEPRIVED OPPORTUNITY TO EXAMINE HER. SHE DID NOT PRODUCE COMPLETE BANK ACCO UNT AS CALLED FOR BEFORE THE AO. IT IS ALSO NOT UNDERSTOOD AS HOW SHE PARTED AWAY HER ALL MONEY BY KEEPING JUST SMALL AMOUNT FOR HER LIFE. FURTHER, THERE WAS NO OCCASION OF GIVING GIFTS NOR THE FAMILY OF THE ASSESSEE HAS EVER GAVE HER ANY GIFTS. THE LD. CIT (A) EXCEEDED HER JU RISDICTION BY NOT REMANDING THE MATTER TO SHRI DEEPAK KLARA / I.T.A. NO.SS68 /IND/2016/A.Y.:1 1-12 PAGE 4 OF 4 THE AO AND CHOSEN TO EXAMINE HER OWN. THEREFORE, I N SUCH CIRCUMSTANCES, THE DELETION OF ADDITION IS NOT JUSTIFIED. 5. WE HAVE HEARD THE RIVAL SUBMISSIONS OF BOTH THE PAR TIES AND HAVE PERUSED THE MATERIAL AVAILABLE ON RECORD. WE FIND THAT THE AO HAS ISSUED SUMMONS UNDER SECTION 131 OF THE ACT ON 02.03.2015 TO SMT. MAYA SACHDEV, DONOR OF RS. 1. 50 CRORES AS GIFT TO THE ASSESSEE. HOWEVER, SHE DID NOT APPEAR BEFORE THE AO BY TAKING SOME EXCUSE OF HER AGE WHEREAS SHE WAS HANDLING HER BUSINESS. FURTHER, THE REQUIRED PE RIOD BANK ACCOUNT WAS NOT FILED BEFORE THE AO. WE FURTHER FOUND LD. CIT (A) HAS CHOSEN TO SUMMON HER BY ISSUE OF SUMMONS UNDER SECTION 131 OF THE ACT AT THE BACK OF THE AO. THE L D. CIT (A) OUGHT TO HAVE EXAMINED SMT. MAYA SACHDEV THROUGH THE AO ONLY, THROUGH REMAND RE PORT. THUS, WE ARE OF THE VIEW THE LD. CIT (A) HAS NOT FOLLOWED PROPER PROCEDURE AND T HE AO WAS DEPRIVED THE OPPORTUNITY BEING A PARTY AS HIS ORDER WAS SUBJECT MATTER OF AP PEAL. IN VIEW OF THIS MATTER, WE ARE OF THE VIEW, WE ARE INCLINED TO SET-ASIDE THE ISSUE TO THE FILE THE AO THE AO FOR EXAMINATION DENOVO. THE ASSESSEE WILL PRODUCE SMT. MAYA SACHDEV BEFORE THE ASSESSING OFFICER FOR EXAMINATION. ACCORDINGLY, THE ISSUE IS RESTORED TO THE FILE OF THE AO. THE REVENUE GROUNDS OF APPEAL IS ALLOWED FOR STATISTICAL PURPOSE. 6. IN THE RESULT, THE APPEAL OF THE REVENUE IS ALLOWED ; FOR STATISTICAL PURPOSE. 7. THE ORDER PRONOUNCED IN THE OPEN COURT ON 17.01.201 7 SD/- SD/- ( . . ) (D.T.GARASIA) JUDICIAL MEMBER ( . . ) (O.P.MEENA) ACCOUNTANT MEMBER ' / DATED : 17 JANUARY, 2017.OPM