SMT BINITA BUBNA,KOLKATA vs. ITO, WD-34(1), KOLKATA, KOLKATA

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ITA 138/KOL/2016Status: DisposedITAT Kolkata16 April 2019AY 2011-201216 pages
AI SummaryPartly Allowed

What did the Tribunal hold?

The Tribunal held that the assessee failed to prove that the deposits were derived from commodity exchange transactions, as the exchange's records did not link the assessee's PAN. However, the Tribunal found merit in the assessee's argument that the entire credit side of deposits was added, requiring a re-computation of the peak balance.

What were the facts?

The assessee deposited significant amounts in her bank accounts during the assessment years 2010-11 and 2011-12. The Assessing Officer treated these deposits as unexplained cash credits, and this was upheld by the CIT(A).

What were the issues?

Whether the cash deposits in the bank accounts are unexplained cash credits. Whether the entire credit side of deposits was erroneously added by the lower authorities without considering the peak balance.

Which sections of the Income-tax Act were involved?

Section 68,Section 143(3)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, KOLKATA ‘C’ BENCH, KOLKATA

Before: Sri S.S. Godara & Dr. A.L. Saini

Binita Bubna..............…..............….……...........…………..……………….…...……..…..……………….......Appellant 125, N.S. Road 3rd Floor Kolkata – 700 001 [PAN : AHMPB 8566 F] Vs. Income Tax Officer, Ward-34(1), Kolkata..................................……......…….....….…............Respondent Appearances by: Shri A.N. Kesari, CA, appeared on behalf of the assessee. Shri Saurabh Kumar, Addl. CIT D/R. appearing on behalf of the Revenue. Date of concluding the hearing : January 17th, 2019 Date of pronouncing the order : April 16th , 2019 ORDER Per S.S. Godara, JM :-

Both these assessee’s appeal for Assessment Years 2010-11 & 2011-2 arise against the separate orders of the Commissioner of Income Tax (Appeals) - 10, Kolkata passed in case nos. 52/CIT(A)-10/34/(1)/2016-17/Kol & 46/CIT(A)-10/Wd-34(1)/14- 15/Kol, confirming the Assessing Officer’s action making additions on account of unexplained cash credits, in proceedings u/s 143(3) of the Income Tax Act, 1961 (in short ‘the Act’).

2.

Heard both parties. Case files perused.

3.

The assessee’s only argument raised during the course of hearing challenges correctness of both the lower authorities action holding her deposits amounting to Rs.31,25,595/- and Rs.49,80,000/- to be unexplained cash credits in the two impugned assessment years. Our attention is invited to assessee’s additional grounds of appeal

as well seeking to delete both the impugned addition in principle. It transpires during the course of hearing that the CIT(A) has followed his detailed discussion in latter

2. Assessment Year: 2010-11 & ITA No. 138/Kol/2016 Assessment Year: 2011-12 Binita Bubna Assessment Year 2011-12 mutatis mutandis in earlier Assessment Year 2010-11 whilst confirming the impugned assessment order. The CIT(A)’s findings under challenge reads as under:-

4. We have given our thoughtful consideration to the rival contentions. There is hardly any dispute about the assessee having made the impugned deposits in her bank account in the two assessment years. Ld. Counsel for the assessee invites our attention to the assessee’s detailed paper book comprising of income tax filing acknowledgement, revised computation, balance sheet as well as P&L account for the two Assessment Years, copy of contract notes, bank statements, cash retention statements, copy of original assessment order, the Assessing Officer’s notice u/s 133(6), copy of section 263 order with record, Assessing Officer’s showcause notice as well as the exchange’s report dt. 27/01/2016 and her ledger account with broker relating to commodity profit/loss followed by compliance letter submitted by the broker in response to section 133(6) notice. The assessee’s case is accordingly that all the said evidence sufficiently proves her to have derived income from commodity exchange transactions only. She vehemently contends therefore that both the lower authorities have erred in law as well as in facts in treating the impugned cash deposits to be unexplained u/s 68 of the Act.

15 Assessment Year: 2010-11 & ITA No. 138/Kol/2016 Assessment Year: 2011-12 Binita Bubna The Revenue strongly supports both the lower authorities action making the impugned addition.

5.

We have given our thoughtful consideration to the rival contentions.

6.

It transpires from a perusal of the case files that the assessee has failed to prove from the stock exchange record that she had derived any income in commodity transactions. The relevant stock exchange M/s. NMCE filed its response dt. 27/01/2016 before the department making it clear that the assessee’s PAN No. nowhere forms part of its database with any of its members. This clinching finding has gone unrebutted before us during the course of hearing. The assessee has tried her level best to rely upon the broker’s ledger (supra) other documents on record in support of her arguments. We find no force in all these averments since the commodity exchange in issue has failed to support her case by way of all relevant details. Hon’ble apex court’s landmark decisions in Sumita Dayal vs. CIT in Civil Appeal No. 1344-45 of 1977 and CIT vs. Durga Prasad More 81 ITR 540, settle the law that any evidence filed during the course of proceedings under the Act have to be appreciated in the light of human probabilities by removing all blinkers. We draw support therefrom to conclude that both the lower authorities have rightly assessed the impugned cash deposits to be unexplained in the two assessment years in principle.

7.

Next comes the assessee’s latter argument that both the lower authorities have added the entire credit side of her deposits in these two assessment years. She seeks to place reliance on her bank statement to this effect forming part of the case records in the two Assessment Years. The Revenue is fair enough in contending that this latter issue requires a detailed examination of assessee’s bank statements comprising of both credit as well as debit side. We therefore deem it proper in larger interest of justice that the assessing officer needs to redo the entire exercise of arriving at the peak figure along with the credit side of closing as well as opening balance in the two Assessment Years. We therefore remit this computation issue back to the Assessing Officer to be decided in view of the assessee’s corresponding bank statements as per law. Ordered accordingly.

16 Assessment Year: 2010-11 & ITA No. 138/Kol/2016 Assessment Year: 2011-12 Binita Bubna 8. These two assessee’s appeal are partly allowed for statistical purposes in above terms.

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