SMT. SATINDER KAUR,LUDHIANA vs. INCOME TAX OFFICER, ALWAR

In this appeal, the assessee is basically aggrieved for addition of Rs. 9,24,100/- made U/s 68 of the Act.

Rival contentions have been heard and record perused. The facts in brief are that the assessee is an individual and filed her return of income on 25/12/2013 declaring total income of Rs. 2,81,400/-. In the course of scrutiny assessment, the A.O. found that the assessee had purchased an Innova car from M/s Chadha Super Cars Pvt. Ltd. on 30.10.2012 for Rs.11,70,673/-. The source of same was explained to be Rs.23,150/- paid in cash, loan of Rs.3 lacs taken from HDFC Bank and Rs.9 lacs paid by her mother Smt. Surendra Kaur from her HDFC bank account. However, the AO noted that assessee has purchased the car for Rs.12,43,935/- on 30.10.2012 including registration charges, accessories, insurance against which payment of Rs.23,150/- is made in cash, Rs.9 lacs is paid from HDFC bank account of Smt. Surinder Kaur, rebate & discount is Rs.4,972/-, HDFC loan is of Rs.2,87,244/- and Rs.24,100/- is paid vide cheque of Kotak Mahindra Bank dated 10.12.2012. On verification of bank account of Smt. Surinder Kaur, the AO observed that prior to the date of payment of Rs.9 lacs to M/s Chadha Super Cars Pvt. Ltd., there was deposit of Rs.4 lacs on 18.10.2012 and Rs.5 lacs on 19.10.2012 in her bank account. The assessee failed to explain the source of this deposit and also failed to furnish the copy of bank account of Kotak Mahindra Bank from where Smt. Satinder Kaur Vs ITO payment of Rs.24,100/- was made. Further, the assessee also failed to furnish the details of PAN, copies of ITRs etc. filed by Smt. Surinder Kaur, therefore, verification of the creditworthiness & genuineness of the transaction is not proved. Accordingly, the AO made addition of Rs.9,24,100/- on account of unexplained investment made in purchase of motor vehicle. By the impugned order, the ld. CIT(A) confirmed the action of the A.O., against which the assessee is in further appeal before the ITAT.

It was argued by the ld AR of the assessee that there is no dispute as to the fact that Rs.9 lacs were paid by the mother of the assessee Smt. Surinder Kaur from her HDFC bank account to M/s Chadha Super Cars Pvt. Ltd. against the car purchased by the assessee. Immediately before this payment, there are two credits in her bank account by clearing. In course of assessment proceedings, details of these clearing deposits could not be explained as the mother of assessee has expired on 09.05.2014. In fact, this credit in the bank account of the mother of assessee is against the sale of Verna Car No. PB10DU7619 to Sh. Amarjeet Kaur, w/o Gurpreet Singh. In any case since this credit is in the bank account of the mother of assessee having PAN A/c

He further argued that Section 68 can be invoked when any sum is found credited in the books of accounts of assessee. Books of accounts in which unexplained cash credit is found must be of assessee himself and not of any other assessee. The Hon'ble Punjab & Haryana High Court in case of Smt. Shanta Devi Vs. CIT 171 ITR 532 has held that perusal of sec. 68 would show that in relation to the expression "books", the emphasis is on the word "assessee". In other words, such books have to be the books of assessee himself and not of any other assessee. Thus, books of accounts of the partnership firm cannot be considered to be the books of accounts of partner and hence, any cash credit shown therein cannot be brought to tax as income u/s 68 in the hands of the partners. In the present case also, credit of Rs.9 lacs are appearing in the bank account of assessee's mother Smt. Surinder Kaur. The assessee has only income from house property and bank interest and she is not required to maintain books of accounts. Therefore, the addition Smt. Satinder Kaur Vs ITO confirmed by the lower authorities u/s 68 is against the provisions of the Act.

On the other hand, the ld. DR has relied on the orders of the authorities below and contended that the assessee could not explain the deposit of cash in bank account of her mother, therefore, the A.O. was justified in making addition of Rs. 9,24,100/-.

I have considered the rival contentions and carefully gone through the orders of the authorities below. As per the contention of the ld AR cash was deposited in the bank account of the mother of the assessee out of sale proceeds of her old car to Mrs. Amarjeet Kaur. The assessee has also filed PAN detail of the mother. Under these facts and circumstances, as per my considered view, the A.O. should reexamine the factum of sale of car by the mother, proceeds of which was utilized for deposit in the bank account. In all fairness, I restore the matter back to the file of the A.O. for deciding the issue afresh after giving due and effective opportunity of being heard to the assessee. The assessee is at liberty to place any other evidence in support of her claim. I direct accordingly. Order pronounced in the open court on 19th August, 2019 ¼jes'k lh 'kekZ½ (RAMESH C SHARMA) ys[kk lnL;@Accountant Member Tk;iqj@Jaipur fnukad@Dated:- 19th August, 2019 *Ranjan आदेश की प्रतिलिपि अग्रेf’ात@ब्वचल वf जीम वतकमत वितूंतकमक जवरू vihykFkhZ@The Appellant- Smt. Satinder Kaur, Ludhiana, Punjab. 1. izR;FkhZ@ The Respondent- The I.T.O., Ward 1(4), Alwar. 2. vk;dj vk;qDr@ CIT 3. vk;dj vk;qDr¼vihy½@The CIT(A) 4. विभागीय प्रतिनिधि] आयकर अपीलीय अधिकरण] जयपुर@क्त्ए प्ज्Aज्ए

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