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Income Tax Appellate Tribunal, MUMBAI BENCHES “D”, MUMBAI
Before: Shri Sanjay Garg, & Shri Ashwani Taneja
Before Shri Sanjay Garg, Judicial Member, and Shri Ashwani Taneja, Accountant Member Assessment Year: 2009-10 Mrs. Dolly Luthra, ITO 21(1)(1) 155 Saket Nagar, बनाम/ Mumbai Indore, M.P. Vs. (Assessee) (Revenue) P.A. No. ABPPL0268D Appellant by Shri Sunil R. Bhandari (AR) Shri B.S. Bist (Sr. DR) Revenue by 26/09/2016 सुनवाई क" तार"ख / Date of Hearing : 30/09/2016 आदेश क" तार"ख /Date of Order: आदेश / O R D E R Per Ashwani Taneja (Accountant Member): This appeal has been filed by the Assessee against the order of Ld. Commissioner of Income Tax (Appeals), Mumbai- 22 {(in short ‘CIT(A)’}, dated 19.06.2014 passed against assessment order u/s 143(3) dated 13.12.2011 for the Assessment Year 2009-10 on the following grounds:
2 Mrs. Dolly Luthra “1.On the facts and in the circumstances of the case and in Law, the Ld Commissioner of Income Tax (Appeals) [here-in-after referred to as Ld. CIT (Appeals)] was not justified and erred in upholding addition of Rs. 13.91771/- made by the Assessing Officer u/s 68 of Income Tax Act.
2. On the facts and in the circumstances of the case and in Law, the Learned CIT (Appeals) was not justified and erred in upholding addition of Rs. 98,507/- made by the Assessing Officer u/s 68 of Income Tax.
3. On the facts and in the circumstances of the case and in Law. the Learned CIT (Appeals) was not justified and erred in sustaining addition to the extent of Rs. 20,000/- made by the Assessing Officer u/s 68 of Income Tax Act. 4.Without prejudice to any of the grounds raised
above, the Learned CIT(Appeals) failed to appreciate that addition for unexplained credit under section 68 is not mandatory but is discretionary as evident from the words "the sum so credited may be charged to income-tax as the income" used in section 68.
5. That the appellant craves leave to add, to amend, modify, rescind, supplement or alter any of the Grounds stated here-in-above, either before or at the time of hearing of this appeal.”
During the course of hearing, arguments were made by Shri Sunil R. Bhandari, Authorised Representative (AR) on behalf of the Assessee and by Shri B.S. Bist, Departmental Representative (DR) on behalf of the Revenue.
Ground No.1: In this ground, the assessee has agitated the action of lower authorities in upholding addition of Rs.13,91,771/- made u/s 68 on account of cash deposited by the assessee in her bank account during the year under consideration.
3 Mrs. Dolly Luthra 3.1. The brief facts of the case as culled out from the order of the lower authorities are that on the basis of AIR, the AO asked the assessee to explain the cash deposit of Rs.15,90,000/- in assessee’s saving bank account. Before the AO, it was inter alia explained by the assessee that all the financial affairs of the assessee were being looked after by her husband and after his unfortunate death, the assessee faced severe financial crisis and everything in this regard had gone haywire. It was also submitted that aggregate amount of cash deposited in her saving bank account maintained with Standard Chartered Bank was Rs. 13,91,771/-. In respect to the same, it was explained that the assessee has been time to time withdrawing cash for her family needs from her another bank account maintained with the Corporation Bank, Matunga, Mumbai, on various dates and when the cash could not be properly utilized the same was deposited back into another bank account maintained with Standard Chartered Bank, Indore, for some family needs. The AO was not satisfied with the justification of withdrawing and keeping cash idle and therefore the entire amount deposited in the Standard Chartered bank was found unexplained, and therefore same was added u/s 68 of the Act. 3.2. Being aggrieved, the assessee filed an appeal before the Ld. CIT(A) and furnished various details and evidences to explain the sources of the cash deposited into her bank account. The main thrust of argument of the assessee before the Ld. CIT(A) was same as was before the AO viz. the original sources was cash withdrawn from assessee’s account 4 Mrs. Dolly Luthra maintained with Corporation Bank. However, Ld. CIT(A) was not satisfied with the submissions of the assessee and therefore he confirmed order of the AO. 3.3. Being aggrieved, the assessee filed before us. During the course of hearing, Ld. Counsel reiterated the adverse circumstances faced by the assessee since unfortunate demise of her husband who was looking after all the financial matters of the assessee. It was also submitted that this fact is not disputed that cash was withdrawn from the Corporation Bank. The assessee for her various family needs, has been withdrawing and depositing cash from one bank account to the other. No evidences have been brought on record by the lower authorities to demonstrate that cash withdrawn from the Corporation Bank was utilized elsewhere. Under these circumstances, the source of cash deposited into Standard Corporation Bank account stood duly explained. The burden has been wrongly put upon the assessee to prove the negative i.e. the cash was not utilized elsewhere. Such an approach of the lower authorities was not fair. He, thus, requested for deleting the addition made by the lower authorities. 3.4. Per contra, Ld. DR reiterated the reasoning given by the AO and Ld. CIT(A). 3.5. We have gone through the orders of the lower authorities as well as submissions made by both the sides before us. Before us, Ld. DR fairly submitted that nothing is there on record to show that cash has been utilized elsewhere. Thus, in our view, the assessee has been able to successfully show the availability of cash. The requisite cash flow statement, etc.
5 Mrs. Dolly Luthra have been filed before the lower authorities. Nothing is there on record to show that cash withdrawn from the Corporation Bank has been utilized elsewhere. In case the AO was keen to allege that the cash withdrawn from Corporation Bank might have been utilised somewhere else, then the burden was upon the revenue to prove the same. The assessee cannot be asked to prove the negative. In other words, the assessee cannot prove that cash was not utilized elsewhere. In our opinion, the assessee as was very much at her liberty to keep availability of cash in such a manner so as to fulfill her family needs by withdrawing cash from her one bank account, keeping it with with her and depositing it into another bank account, in accordance with her family needs and other requirements especially after the death of her husband. In our view, the assessee has been able to successful prove the source of cash deposited in her account maintained with Standard Chartered Bank. Thus, addition made was illegal and incorrect on facts and therefore same is directed to be deleted. This ground is allowed.
Ground No.2: In this ground, the assessee has challenged the action of lower authorities in upholding addition of Rs.98,507/- on account of cash deposited in bank account, the source of which was claimed to be reimbursement received from Imperial Academy and Ms. Sheetu Luthra against expenses incurred earlier by the assessee. 4.1. The brief findings in this regard are that the aggregate amount of Rs.98,507/- was explained by the assessee to have been received from M/s Imperial Academy and Ms. Sheetu 6 Mrs. Dolly Luthra Luthra on different dates on account of reimbursement of expenses which were incurred on earlier dates by the assessee. The lower authorities made the addition on the ground that nothing was brought on record to substantiate the claim of the assessee. Before us, Ld. counsel of the assessee submitted that out of the total amount, a sum of Rs.23,150/- was on account of reimbursement received from Imperial Academy for which admittedly no evidences could be submitted. But with regard to amount received from Ms. Sheetu Luthra, confirmation letter duly signed by her was submitted before the lower authorities. But, the same has been rejected after finding some faults therein that too without confronting the same with the assessee. 4.2. Per contra, Ld. DR relied upon the orders of the lower authorities. 4.3. We have gone through the orders of the lower authorities carefully and find that there is no evidence at all with respect to sum of Rs.23,150/- claimed to be received on account of reimbursement from M/s. Imperial Academy and therefore same has been rightly disallowed by the AO and the same is confirmed. But, with respect to balance sum of Rs.75,350/-, it is noted that the same was received by the assessee from her daughter namely Ms. Sheetu Luthra. In support of this, a confirmation letter issued by Mrs. Sheetu Luthra was filed before the Ld. CIT(A) also. The same has been rejected on the ground that same was undated and the fact of payment of cash on 01.02.2009 was not explicitly mentioned therein. We do not appreciate the approach followed by the Ld. CIT(A) in 7 Mrs. Dolly Luthra this regard. While rejecting the evidence submitted by the assessee, in case the Ld. CIT(A) felt some deficiencies in the confirmation, the same should have been confronted to the assessee. Alternatively, it was well within the powers of the lower authorities to get these facts directly verified from Ms. Sheetu Luthra whose complete particulars were there before them. Without properly examining the evidences, these should not be rejected on some surmises and conjectures. Such kind of approach leads to unfairness and shakes the faith of the taxpayers and therefore, it should be avoided. Under these circumstances, in our opinion, the assessee had duly submitted the evidences with respect to said amount. Therefore, the AO is directed to delete sum of Rs.75,350/-. Thus, this ground is partly allowed.
Ground No.3: In this ground, the assessee has challenged the action of lower authorities in making addition of Rs.20,000/-. 5.1. During the course of assessment proceedings it was noted by the AO that aggregate amount of Rs.2,00,000/- was received by the assessee from Imperial College of Professional Studies(ICPS), out of which a sum of Rs.1,80,000/- was received by way of cheque and balance amount of Rs.20,000/- was received in cash. The total outstanding balance receivable from the said College was Rs.1,91,332/-. The AO made aggregate addition of Rs.2,00,000/-. The Ld. CIT(A) deleted the addition of Rs.1,80,000/- and sustained the balance amount of Rs.20,000/-. Before us, Ld. counsel submitted that when all the transactions from the said College were accepted by the 8 Mrs. Dolly Luthra Ld. CIT(A), there were no basis to disbelieve transactions of Rs.20,000/- that too without any verification or bringing on record to any contrary material. 5.2. Per contra, Ld. DR relied upon the orders of the lower authorities. 5.3. We have gone through the orders of the lower authorities. It is noted that assessee brought on record of complete details and findings on record, and copy of ledger account of Imperial College of Professional Studies was also submitted. When the Ld. CIT(A) himself believed the transaction to the extent of Rs.1,80,000/-, there were no concrete basis to disbelieve the remaining amount of Rs.20,000, merely because same was received in cash. The Ld. CIT(A) had full powers under the law to make direct verification from the said property in case there were any doubts. But, without making any verification, he was not justified to partly disbelieve the account. Thus, addition of Rs.20,000/- has been wrongly sustained and same is directed to be deleted. This ground is allowed.
Ground Nos. 4 & 5 are general and do not need any specific adjudication and therefore dismissed.
In the result, the appeal of the Assessee is partly allowed.
Order pronounced in the open court on 30.09.2016. (Sanjay Garg ) (Ashwani Taneja) "या"यक सद"य / JUDICIAL MEMBER लेखा सद"य / ACCOUNTANT MEMBER मुंबई Mumbai; "दनांक Dated : 30/09/2016 ctàxÄ? P.S/."न.स.