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आदेश/Order
The present appeal has been preferred by the assessee against the order dated 24.12.2018 of the Commissioner of Income Tax (Appeals)- Palampur [hereinafter referred to as ‘CIT(A)’]
The assessee in this appeal has agitated the confirmation of 2. addition of Rs. 4,08,330/- into the income of the assessee on account of unexplained expenditure.
The brief facts of the case are that the assessee incurred an expenditure of a sum of Rs. 13.70 lacs for admission of his daughter in - Shri Anil Kumar, Una 2 MBBS Couse in an educational Institution namely Rohilkhand Medical College under the trust i.e. M/s Rohilkhand Educational Charitable Trust. On being asked to explain the sources of the aforesaid expenditure incurred on fee of his daughter, the assessee could explain the source of the amount of Rs. 9,61,670/-. So far as the remaining amount of Rs. 4,08,330/- was concerned, the assessee explained that the amount of Rs. 3 lacs was received by him from his sister-in-law which was further withdrawn by her from her bank account. Further, the remaining amount of Rs. 1,08,330/- was withdrawn from his bank account. However, the Ld. Assessing Officer did not agree with the aforesaid explanation given by the assessee. He observed that the sister-in-law of the assessee has withdrawn the amount at the beginning of the financial year, whereas, the payment was deposited after four months of the withdrawal made. So far as the remaining amount of Rs. 1,08,330/- was concerned, the Assessing Officer observed that the assessee had made so many payments such as housing loan, LIC premium etc. and, therefore, there was no likelihood that the assessee was possessed of the said funds to make the aforesaid expenditure on fees of his daughter. The Assessing Officer concluded that the assessee could not prove the source of the aforesaid funds, he, therefore, made the impugned addition into the income of the assessee being expenditure incurred from undisclosed sources.
The Ld. CIT(A) confirmed the addition so made by the Assessing Officer. - Shri Anil Kumar, Una 3
I have heard the rival contentions of the Ld. Authorized Representatives of both the parties and have gone through the record. A perusal of the impugned assessment order reveals that the Assessing Officer himself has drawn a chart, wherein, at Colum No. 6, he has duly acknowledged that Smt. Nirmal Devi had withdrawn the amount of Rs. 3 lacs from her bank account on 2.4.2009. The assessee has pleaded that the aforesaid amount of Rs. 3 lacs was gifted by his sister-in-law so as to financially help the assessee to admit her daughter for MBBS course.
The Assessing Officer rejected the above explanation only on the ground that the amount was withdrawn five months back and by that date the result of 10+2 examination, which was the basic qualification for admission to the MBBS course, had not been declared.
In my view, the Assessing Officer has wrongly rejected the contentions of the assessee. The parents of a child, now a days, even prior to the declaration of result of 10th class of the child, start planning for the future of their child / children. Since the assessee’s daughter had appeared for 10+2 examination and the assessee wanted his daughter to do MBBS course, hence, to pay the required fee, the assessee might have started arranging for funds in advance so as to make the payment on the stipulated date of admission. Further, the assessee’s sister-in-law had withdrawn an amount of Rs. 3 lacs from her bank account, which the assessee claimed to have been contributed by her for helping the assessee to get admission of his daughter in MBBS course. Under such - Shri Anil Kumar, Una 4 circumstances, merely because the money was withdrawn 4 – 5 months earlier, is not a ground to disbelieve the contention of the assessee.
So far as the addition of the amount of Rs. 1,08,330/- is concerned, the assessee duly explained that even after meeting of the expenditure incurred on LIC Premium etc., the assessee was possessed of the said funds. It was also explained that the assessee’s wife also contributed some amount from her past saving out of household expenses. Considering the plea of the assessee that it was out of withdrawal made from the bank and the said amount was saved after meeting the household expenditure & other liabilities and also considering the smallness of the amount, the addition, in my view, is not justified on this issue also.
In view of this, there is no justification on the part of the lower authorities in making and confirming the addition of Rs. 4,08,330/- and the same is accordingly ordered to be deleted.
In the result, the appeal of the assessee is hereby allowed.
Order dictated and pronounced in the Open Court immediately on completion of hearing on 01.01.2020.