Sri B.Krishnaiah,, Hyderabad v. Dy.CIT,Central Circle-6,, Hyderabad

ITA 1740/HYD/2013 | 2010-2011
Pronouncement Date: 16-04-2014 | Result: Allowed

Appeal Details

RSA Number 174022514 RSA 2013
Assessee PAN ACVPB8494N
Bench Hyderabad
Appeal Number ITA 1740/HYD/2013
Duration Of Justice 4 month(s)
Appellant Sri B.Krishnaiah,, Hyderabad
Respondent Dy.CIT,Central Circle-6,, Hyderabad
Appeal Type Income Tax Appeal
Pronouncement Date 16-04-2014
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted B
Tribunal Order Date 16-04-2014
Assessment Year 2010-2011
Appeal Filed On 16-12-2013
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCHES B : HYDERABAD BEFORE SHRI B.R. BASKARAN ACCOUNTANT MEMBER AND SHRI SAKTIJIT DEY JUDICIAL MEMBER ITA.NO.1740/HYD/2013 ASSESSMENT YEAR 2010-2011 SRI B. KRISHNAIAH HYDERABAD PAN ACVPB 8494N VS. THE DCIT C.C. 6 HYDERABAD (APPELLANT) (RESPONDENT) FOR ASSESSEE : MR. D.V. ANJANEYULU AND MRS. P. PRAVALLIKA FOR REVENUE : MR. SOLGY JOSE T KOTTARAM DATE OF HEARING : 15.04.2014 DATE OF PRONOUNCEMENT : 16.04.2014 ORDER PER B.R. BASKARAN A.M. THE APPEAL FILED BY THE ASSESSEE IS DIREC TED AGAINST THE ORDER DATED 16.09.2013 PASSED BY LD CIT (A)-I HYDERABAD AND IT PERTAINS TO THE A.Y. 2010-2011. 2. THE SOLITARY ISSUE URGED IN THIS APPEAL IS W HETHER LD. CIT(A) WAS JUSTIFIED IN CONFIRMING THE ASSESSMENT O F RS.6 31 100/- BEING THE CASH FOUND DURING THE COU RSE OF SEARCH AS UNEXPLAINED INCOME IN THE HANDS OF THE AS SESSEE. 3. FACTS RELATING TO THE ISSUE ARE STATED IN BRIE F. THE ASSESSEE WAS SUBJECTED TO SEARCH AND SEIZURE OPERAT ION ON 20.08.2009. DURING THE COURSE OF SEARCH CASH BALAN CE OF RS.6 31 100/- WAS FOUND AT THE RESIDENCE OF THE ASS ESSEE. IN THE PRELIMINARY STATEMENT TAKEN AT THE TIME OF COMM ENCEMENT 2 ITA.NO.1740/HYD/2013 MR. B. KRISHNAIAH HYDERABAD OF THE SEARCH THE ASSESSEE HAD STATED THAT A CASH BALANCE OF LESS THAN RS. 1 LAKH WILL BE AVAILABLE AT HIS RESID ENCE. THOUGH THE ASSESSEE EXPLAINED BEFORE THE A.O. DURING THE COURSE OF ASSESSMENT PROCEEDINGS THAT THE ABOVE SAID CASH BA LANCE OF RS.6 31 100/- RELATED TO THE CASH WITHDRAWN BY HIM FROM HIS BANK ACCOUNT ON 17.08.2009 YET THE A.O. DID NOT AC CEPT THE SAID EXPLANATION ON THE REASONING THAT THE SAME IS CONTRADICTORY WITH THE PRELIMINARY STATEMENT GIVEN BY HIM AT THE TIME OF COMMENCEMENT OF SEARCH. THE A.O. ALSO T OOK THE VIEW THAT THE ASSESSEE HAS FAILED TO ESTABLISH THE NEXUS BETWEEN THE CASH WITHDRAWN FROM THE BANK AND THE CA SH FOUND AT THE RESIDENCE. ACCORDINGLY HE ASSESSED TH E SUM OF RS.6 31 100/- AS INCOME RELATING TO UNEXPLAINED CAS H IN THE HANDS OF THE ASSESSEE. 4. IN THE APPEAL PROCEEDINGS THE LD. CIT(A) CONFIRMED THE ADDITION WITH THE FOLLOWING OBSERVATI ONS : 7. I HAVE GONE THROUGH THE FACTS OF THE CASE. THE BANK A/C COPY FILED SHOWS WITHDRAWAL OF RS.7 00 000/- ON 17.8.2009 WITH NARRATION SELF AND SEARCH AND SEIZURE OPERATION TOOK PLACE ON 20.8.2009. FROM TH E BANK ACCOUNT STATEMENT IT IS NOTICED THAT THE APPELLANT HAD DEPOSITED RS.3 03 84 397/- ON 14.8.2009 BY CHEQUE CLEARING AND HE HAS BEEN WITHDRAWING HUGE AMOUNTS IN FAVOUR OF BOLLINENI DEVELOPERS. HE IS THE KEY PERSON OF THE GROUP AND H E WOULD NOT BE WITHDRAWING AMOUNTS TO KEEP IT IDLE AT HOUSE. IT MUST HAVE BEEN WITHDRAWN FOR SOME OTHER PURPOSE AND EXPENDED THE SAME ON THAT PURPOSE. 7.1. THE ABOVE ARGUMENT IS SUPPORTED BY THE FACT TH AT ON THE DAY OF SEARCH I.E. 20.8.2009 HE ADMITTED THAT THE CASH AVAILABLE IN HIS RESIDENCE WAS BELOW RS.1 00 000/- AND IT IS ONLY AN AFTER-THOUGHT AFTER 3 DAYS I.E. ON THE DAY OF SEARCH HE CLAIMED THAT TH E CASH WITHDRAWN ON 17.8.2009 WAS THE AMOUNT FOUND AT HIS RESIDENCE. AS THE ASSESSING OFFICER POINTED OUT THAT NO NEXUS WAS ESTABLISHED BETWEEN 3 ITA.NO.1740/HYD/2013 MR. B. KRISHNAIAH HYDERABAD THE CASH WITHDRAWN AND CASH FOUND AT RESIDENCE IT MAY BE NOTED THAT SURMISES AND CONJECTURES ON THE CASH FOUND AT THE TIME OF SEARCH CANNOT BE ACCEPTED . ACCORDINGLY THE ADDITION MADE OF RS.6 31 100/- IS SUSTAINED. AGGRIEVED BY THE ORDER PASSED BY LD CIT(A) THE ASS ESSEE HAS FILED THIS APPEAL BEFORE US. 5. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERU SED THE RECORD. THE LD D.R PLACED STRONG RELIANCE ON THE O RDER PASSED BY LD CIT(A) AND SUBMITTED THAT THE ASSESSEE HAS FA ILED TO SHOW THE NEXUS BETWEEN THE CASH WITHDRAWAL MADE FRO M THE BANK AND THE CASH FOUND AT HIS RESIDENCE AT THE TIM E OF SEARCH AND FURTHER THE EXPLANATION OF THE ASSESSEE IS IN C ONTRADICTION WITH THE PRELIMINARY STATEMENT GIVEN AT THE TIME OF COMMENCEMENT OF SEARCH. ON THE CONTRARY THE LD A. R VEHEMENTLY CONTENDED THAT THE IMPUGNED ADDITION HAS BEEN MADE ON SURMISES AND PRESUMPTIONS. THE LD A.R FURT HER SUBMITTED THAT THE ASSESSEE HAS FURNISHED EVIDENCE SHOWING WITHDRAWAL OF CASH FROM BANK JUST TWO DAYS PRIOR TO THE DATE OF SEARCH AND ACCORDINGLY EXPLAINED THE SOURCE OF CASH FOUND DURING THE COURSE OF SEARCH. HE FURTHER SUBMITTED THAT THE REVENUE DID NOT BRING ANY MATERIAL ON RECORD TO SHO W THAT THE AMOUNT SO WITHDRAWN WAS SPENT AWAY OR UTILIZED BY T HE ASSESSEE FOR SOME OTHER PURPOSE. THE LD A.R PLACED STRONG RELIANCE ON THE DECISION OF JABALPUR BENCH OF TRIB UNAL IN THE CASE OF DCIT VS. VISHWANATH PRASAD GUPTA (2011) (13 0 ITD 73) AND SUBMITTED THAT THE IMPUGNED ADDITION SHOULD NOT HAVE BEEN MADE SINCE THE ASSESSEE HAS EXPLAINED THE SOU RCES OF THE CASH FOUND DURING THE COURSE OF SEARCH. 6. WE FIND FORCE IN THE ARGUMENTS ADVANCED BY T HE LD COUNSEL FOR THE ASSESSEE. IT IS AN ADMITTED FACT T HAT THE 4 ITA.NO.1740/HYD/2013 MR. B. KRISHNAIAH HYDERABAD ASSESSEE HAS WITHDRAWN A SUM OF RS.7.00 LAKHS ON 17 .08.2009 FROM THE BANK ACCOUNT MAINTAINED IN HIS NAME WITH M /S VIJAYA BANK. THE SEARCH TOOK PLACE ON 20-08-2009 A ND THE REVENUE FOUND CASH BALANCE OF RS.6 31 100/- AT HIS RESIDENCE. THUS IT IS SEEN THAT THE CASH FOUND AT THE TIME OF SEARCH WAS LESSER THAN THE AMOUNT WITHDRAWN FROM THE BANK TWO DAYS PRIOR TO THE DATE OF SEARCH. IT IS ALSO A FACT THA T THERE IS NO OTHER MATERIAL AVAILABLE ON RECORD TO SHOW THAT THE ASSESSEE HAD SPENT AWAY OR UTILIZED THE AMOUNT SO WITHDRAWN FOR ANY OTHER PURPOSE. WE NOTICE FROM THE ORDER PASSED BY LD CIT(A) THAT THE FIRST APPELLATE AUTHORITY IS ONLY TALKING ABOUT THE POSSIBILITY OF THE AMOUNT BEING SPENT AWAY ON THE R EASONING THAT THE ASSESSEE IS IN BUILDING DEVELOPMENT BUSINE SS AND HENCE HE WOULD NOT KEEP THE MONEY IDLE. IT IS A FA CT THAT THE VIEW EXPRESSED BY LD CIT(A) IS ONLY BASED ON PRESUM PTIONS AND NOT BASED ON ANY MATERIAL. THE AO HAS ALSO EXP RESSED THE VIEW THAT THE ASSESSEE HAS FAILED TO ESTABLISH THE NEXUS BETWEEN THE CASH WITHDRAWAL AND THE CASH FOUND AT H IS RESIDENCE. BUT THE FACT REMAINS THAT THE TIME GAP BETWEEN THE CASH WITHDRAWAL AND THE DATE OF SEARCH WAS ONLY TWO FULL DAYS AND HENCE IN OUR VIEW IT MAY NOT BE CORRECT TO RE JECT THE EXPLANATIONS FURNISHED BY THE ASSESSEE WITHOUT BRIN GING ANY MATERIAL ON RECORD TO CONTRADICT THE SAME. 7. THERE IS NO DISPUTE THAT THE ASSESSEE IN THE PRELIMINARY STATEMENT TAKEN DURING THE COURSE OF SEARCH HAS ST ATED THAT THE CASH BALANCE AVAILABLE IN THE RESIDENCE WILL BE LESS THAN ONE LAKH. THE CONTENTION OF THE LD A.R IS THAT THE ASSESSEE GAVE THE SAID STATEMENT OUT OF MEMORY AND THE SAME IS NOT BASED ON ANY MATERIAL. IN OUR VIEW THE EXPLANATI ON OF THE ASSESSEE ABOUT THE SOURCES OF THE CASH FOUND DURING THE 5 ITA.NO.1740/HYD/2013 MR. B. KRISHNAIAH HYDERABAD COURSE OF SEARCH HAVE TO BE EXAMINED ON THE BASIS O F EVIDENCES AND EXPLANATIONS FURNISHED BY THE ASSESSEE. IN THE INSTANT CASE THE ASSESSEE HAS EXPLAINED THE SOURCE OF CASH AS THE AMOUNT WITHDRAWN FROM THE BANK JUST TWO DAYS PRIOR TO THE DATE OF SEARCH. THERE IS NO MATERIAL TO SHOW THAT THE MONEY SO WITHDRAWN WAS SPENT AWAY OR UTILIZED FOR ANY OTHER PURPOSE. UNDER THESE CIRCUMSTANCES WE ARE OF THE VIEW THAT ASSESSEE HAS EXPLAINED THE SOURCES OF THE CASH FOUND AT HIS RESIDENCE AT THE TIME OF SEARCH AND HENCE NO ADDITION IS WARRANT ED ON THAT ACCOUNT. ACCORDINGLY WE SET ASIDE THE ORDER OF LD CIT(A) ON THIS ISSUE AND DIRECT THE ASSESSING OFFICER TO DELE TE THE IMPUGNED ADDITION. 8. IN THE RESULT THE APPEAL FILED BY THE ASSES SEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 16.04.2014 SD/- SD/- (SAKTIJIT DEY) (B.R. BASKARAN) JUDICIAL MEMBER ACCOUNTANT MEMBER HYDERABAD DATED 16 TH APRIL 2014 VBP/- COPY TO : 1. MR. B. KRISHNAIAH 6-2-913/914 5 TH FLOOR PROGRESSIVE TOWERS KHAIRATABAD HYDERABAD. C/O. M/S. ANJANEYULU & CO. C.AS. 30 BHAGYALAKS HMI NAGAR GANDHI NAGAR HYDERABAD 500 080. 2. DCIT CENTRAL CIRCLE-6 HYDERABAD. 3. CIT(A)-I HYDERABAD 4. CIT (CENTRAL) HYDERABAD 5. D.R. ITAT B BENCH HYDERABAD.