M/s. M. Sudha, Hyderabad v. ITO WARD -4(1), Hyderabad

ITA 726/HYD/2010 | 2006-2007
Pronouncement Date: 08-07-2011 | Result: Dismissed

Appeal Details

RSA Number 72622514 RSA 2010
Assessee PAN AGOPM7250L
Bench Hyderabad
Appeal Number ITA 726/HYD/2010
Duration Of Justice 1 year(s) 1 month(s) 25 day(s)
Appellant M/s. M. Sudha, Hyderabad
Respondent ITO WARD -4(1), Hyderabad
Appeal Type Income Tax Appeal
Pronouncement Date 08-07-2011
Appeal Filed By Assessee
Order Result Dismissed
Bench Allotted B
Tribunal Order Date 08-07-2011
Date Of Final Hearing 14-03-2011
Next Hearing Date 14-03-2011
Assessment Year 2006-2007
Appeal Filed On 13-05-2010
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH B HYDERABAD BEFORE SHRI G.C. GUPTA VICE PRESIDENT AND SHRI CHANDRA POOJARI ACCOUNTANT MEMBER ITA NO.726/HYD/2010 : ASSESSMENT YEAR 2006-0 7 SMT. M.SUDHA HYDERABAD (PAN AGOPM 7250 L) VS INCOME - TAX OFFICER WARD 4(1) HYDERABAD (APPELLANT) (RESPONDENT) AND ITA NO.527/HYD/2010 : ASSESSMENT YEAR 2006-0 7 INCOME - TAX OFFICER WARD 4(1) HYDERABAD VS SMT. M.SUDHA HYDERABAD (PAN AGOPM 7250 L) (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI S.RAMA RAO REVENUE BY : SHRI B.V.PRASAD REDDY O R D E R PER G.C.GUPTA VICE PRESIDENT: THESE CROSS APPEALS BY THE ASSESSEE AND THE REVEN UE FOR THE ASSESSMENT YEARS 2006-07 ARE DIRECTED AGAINST THE O RDER OF THE COMMISSIONER OF INCOME-TAX (APPEALS). THESE ARE BE ING DISPOSED OFF WITH THIS CONSOLIDATED ORDER. 2. THERE IS A DELAY OF SIX DAYS IN THE FILING OF T HE PRESENT APPEAL BY THE ASSESSEE BEFORE THE TRIBUNAL. WE HAVE HEARD THE PARTIES ON THE ISSUE OF ITA NO.726 A ND 527/HYD/2010 SMT. M.SUDHA HYDERABAD 2 CONDONATION OF DELAY IN FILING THE APPEAL. THE ASSE SSEE HAS FILED AN AFFIDAVIT IN SUPPORT OF HER SUBMISSIONS IN THE PETITION FOR C ONDONATION OF DELAY IN FILING THE APPEAL BEFORE US. WE FIND THAT THE HUSBAND OF THE ASSESSEE WHO WAS LOOKING AFTER THE INCOME-TAX MATTER OF THE ASSESSEE HAD TO LEAVE FOR HIS NATIVE PLACE TO SEE HIS GRAND MOTHER WHO FELL SERI OUSLY ILL AND THEREFORE THERE WAS SUFFICIENT CAUSE FOR NOT PRESENTING THE P RESENT APPEAL BEFORE THE TRIBUNAL IN TIME. ACCORDINGLY THE DELAY OF SIX DAY S IN FILING THE PRESENT APPEAL BY THE ASSESSEE BEFORE THE TRIBUNAL IS CONDO NED. 3. GROUNDS OF APPEAL OF THE ASSESSEE IN HER APPEAL ARE AS UNDER- 1) THE ORDER OF THE LEARNED CIT(APPEALS) IS ERRONE OUS TO THE EXTENT IT IS PREJUDICIAL TO THE APPELLANT. 2) THE LEARNED COMMISSIONER OF INCOME-TAX(APPEALS) OUGHT TO HAVE SEEN THAT THE DEPOSITS MADE BY THE APPELLANT HEREIN OF RS.42 29 500/- REPRESENT THE BUSINESS RECEIPTS OF THE APPELLANT HEREIN AND THE BUSINESS RECEIPTS OF THE APPELLANTS HUSBAND. THE L EARNED COMMISSIONER OF INCOME-TAX(APPEALS) OUGHT TO HAVE SEEN THAT THE APPELLANT ADMITTED INCOME ON RUNNING STD BOOTH XEROX CENTRE AND SALE OF SOFT DRINKS. 3) THE LEARNED COMMISSIONER OF INCOME-TAX(APPEALS) OUGHT TO HAVE DELETED THE ENTIRE ADDITION AND DIREC TED THE ASSESSING OFFICER TO ASSESS THE INCOME AS ADMIT TED INSTEAD CONFIRMING ADDITION OF RS.4 01 441/-. GROUNDS OF APPEAL OF THE REVENUE IN ITS APPEAL ARE AS UNDER 01) THE ORDER CIT(APPEALS) IS ERRONEOUS IN LAW OR FACTS OR BOTH. 02) THE CIT(A) IN DIRECTING THE ASSESSING OFFICER TO TAKE UNACCO0UTNED INVESTMENT IN BUSINESS AS RS.4 01 441/ - WHICH IS ARRIVED AT BY REDUCING OPENING BALANCE OF RS.1 63 154/- FROM PEAK AMOUNT FOR S.5 64 595 APPEARING ASSESSEES BANK ACCOUNT. 03) THE CIT(A) IN CONSIDERING CONSIDERING CHEQUE TRANSACTIONS CREDITS & DEBITS BY WAY OF CHEQUES IN ITA NO.726 A ND 527/HYD/2010 SMT. M.SUDHA HYDERABAD 3 ASSESSEES BANK ACCOUNT IN ARRIVING AT THEIR PEAK A MOUNT OF RS.4 01 441. THUS THE ONLY ISSUE ARISING FOR CONSIDERATION IN T HESE CROSS APPEALS OF THE ASSESSEE AND THE REVENUE IS REGARDING THE ADDITION OF RS.42 29 500 MADE ON ACCOUNT OF DEPOSITS IN THE BANK ACCOUNT OF THE ASS ESSEE. THE ASSESSING OFFICER TREATED THE DEPOSITS MADE IN THE BANK ACCOU NT OF THE ASSESSEE AS UNEXPLAINED AND MADE THE ADDITION OF THE ENTIRE AMO UNT OF DEPOSITS IN THE BANK ACCOUNT OF RS.42 29 500 AS INCOME IN THE HANDS OF THE ASSESSEE. IN FIRST APPEAL THE CIT(A) HELD THAT ONLY THE PEAK DE POSIT IN THE BANK ACCOUNT OF THE ASSESSEE SHOULD BE ADDED AS INCOME OF THE AS SESSEE AND ACCORDINGLY DETERMINED THE PEAK AMOUNT OF DEPOSIT ENTRY AND SUS TAINED ADDITION OF RS.4 01 441 AS UNACCOUNTED CAPITAL INVESTED IN THE BUSINESS AND DIRECTED THE ASSESSING OFFICER TO DELETE THE BALANCE ADDITION. B EING AGGRIEVED BOTH THE PARTIES ARE IN APPEAL AGAINST THE ORDER OF THE CIT( A) BEFORE US. 2. LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED TH AT THE DEPOSIT ENTRY IN THE BANK ACCOUNT OF THE ASSESSEE WAS THE J OINT ACCOUNT OF THE ASSESSEE AND HER HUSBAND AND THE HUSBAND IS A DEAL ER IN PURCHASE AND SALE OF SECOND HAND CARS AND HAS FILED SEPARATE RETURN O F INCOME WITH THE DEPARTMENT. HE SUBMITTED THAT MAJORITY OF THE DEPO SIT ENTRIES BELONG TO THE ASSESSEES HUSBAND AND NOT TO THE ASSESSEE. HE SUB MITTED THAT THE ENTRIES IN THE BANK ACCOUNT REPRESENT THE BUSINESS ACTIVITI ES OF BOTH THE ASSESSEE AND THAT OF HER HUSBAND WHICH COULD NOT BE CONSIDER ED AS UNACCOUNTED INCOME OF THE ASSESSEE AND THEREFORE THE ADDITION SUSTAINED BY THE FIRST APPELLATE AUTHORITY OF THE PEAK AMOUNT OF DEPOSIT E NTRY WAS WHOLLY UNJUSTIFIED. 3. THE LEARNED DEPARTMENTAL REPRESENTATIVE HAS OPP OSED THE SUBMISSIONS OF THE LEARNED COUNSEL FOR THE ASSESSEE . HE SUBMITTED THAT THE ONUS WAS ON THE ASSESSEE TO EXPLAIN THE SOURCE OF T HE AMOUNTS DEPOSITED IN ITA NO.726 A ND 527/HYD/2010 SMT. M.SUDHA HYDERABAD 4 THE BANK ACCOUNT OF THE ASSESSEE. HE SUBMITTED THA T INSPITE OF THE OPPORTUNITY GIVEN THE ASSESSEE COULD NOT BIFURCATE AND IDENTIFY THE ENTRIES PERTAINING TO THE ASSESSEE AND THE OTHER ENTRIES PE RTAINING TO HER HUSBAND. HE SUBMITTED THAT THERE WAS NO JUSTIFICATION FOR RE STRICTING THE ADDITION ONLY TO THE PEAK AMOUNT OF THE CREDIT ENTRY AND THE CIT( A) SHOULD HAVE SUSTAINED THE ADDITION MADE OF ALL THE CREDIT ENTRIES IN THE BANK ACCOUNT OF THE ASSESSEE WITH REGARD TO WHICH THE ASSESSEE COULD N OT PROVE THE SOURCE. HE RELIED ON THE ORDER OF THE ASSESSING OFFICER. 4. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS CAREFU LLY. WE FIND THAT THE BANK ACCOUNT IN ING VYSYA BANK GANDHINAGAR BRA NCH HYDERABAD WAS IN THE JOINT NAMES OF THE ASSESSEE AND HER HUSBAND. T HE HUSBAND OF THE ASSESSEE WAS A DEALER IN SECOND HAND CARS. THERE A RE NUMBER OF DEBIT AND CREDIT ENTRIES IN THE BANK ACCOUNT OF THE ASSESSEE. THE ASSESSEE WAS GIVEN AN OPPORTUNITY TO IDENTIFY THE ENTRIES IN HER BANK ACCOUNT WHICH PERTAINS TO HER AND THE OTHER ENTRIES PERTAINING TO HER HUSBAND . THE CIT(A) HAS RECORDED IN HIS APPELLATE ORDER THAT THE ASSESSEE W AS NOT ABLE TO DO SO AND SHE (THE ASSESSEE) COULD NOT IDENTIFY THE SAME. IN THESE FACTS THE REVENUE AUTHORITIES WERE JUSTIFIED IN CONSIDERING THE ENTRI ES IN THE BANK ACCOUNT IN THE HANDS OF THE ASSESSEE. THE ONUS TO SHOW THE SOURCE OF THE ENTRIES IN THE BANK ACCOUNT WAS ON THE ASSESSEE AND THE ASSESSEE W AS NOT ABLE TO DISCHARGE HER ONUS. WE HAVE PERUSED THE RELEVANT PO RTION OF THE BANK ACCOUNT OF THE ASSESSEE WHICH HAS BEEN REPRODUCED B Y THE CIT(A) IN HIS APPELLATE ORDER IN PARA 7.2 THEREOF. WE FIND THAT T HERE ARE A NUMBER OF CREDIT AS WELL AS CORRESPONDING DEBIT ENTRIES OF DEPOSITS AND WITHDRAWALS OF CASH IN THE BANK ACCOUNT OF THE ASSESSEE. THE CIT(A) HAS RE CORDED A FINDING THAT CREDIT ENTRIES AND THE DEBIT ENTRIES WERE THERE WI TH MOST OF THE ENTRIES IN THE BANK ACCOUNT OF THE ASSESSEE. ACCORDINGLY IT I S JUSTIFIED TO CONSIDER BOTH THE DEBIT AND THE CREDIT ENTRIES AS A WHOLE AND THE RE IS NO JUSTIFICATION FOR CONSIDERING ONLY THE CREDIT ENTRIES IN THE BANK ACC OUNT OF THE ASSESSEE. THE ITA NO.726 A ND 527/HYD/2010 SMT. M.SUDHA HYDERABAD 5 ASSESSING OFFICER COULD NOT GIVE ANY VALID REASON F OR TAKING INTO ACCOUNT ONLY THE CREDIT ENTRIES IN THE BANK ACCOUNT OF THE ASSES SEE. ACCORDINGLY THE MAXIMUM AMOUNT OF CREDIT ENTRY IN THE BANK ACCOUNT OF THE ASSESSEE AT A GIVEN POINT OF TIME I.E. THE PEAK DEPOSIT IN THE BANK ACCOUNT COULD BE ADDED AS INCOME IN THE HANDS OF THE ASSESSEE. WE FI ND THAT THE CIT(A) HAS PASSED A SPEAKING ORDER ON THIS ISSUE AND HAS DETER MINED THE FIGURE OF PEAK DEPOSIT IN THE BANK ACCOUNT OF THE ASSESSEE AT RS.5 64 595 AND AFTER REDUCING THE OPENING BALANCE OF RS.1 63 154 FROM TH E PEAK AMOUNT DIRECTED THE ADDITION IN RESPECT OF BALANCE AMOUNT OF RS.4 0 1 441 AS UNACCOUNTED CAPITAL IN THE BANK ACCOUNT OF THE ASSESSEE. THE PA RTIES BEFORE US COULD NOT SHOW ANY MISTAKE IN THE ORDER OF THE CIT(A) IN HOL DING THAT THE PEAK DEPOSITS OF THE BANK ACCOUNT OF THE ASSESSEE WAS AD DABLE AND IN DETERMINING THE SAME AT RS.4 01 441 AFTER REDUCING THE OPENING BALANCE. ACCORDINGLY THE ORDER OF THE CIT(A) IN DIRECTING THE ASSESSING OFFICER TO ADD ONLY AN AMOUNT OF RS.4 01 441 AS UNACCOUNTED INVESTMENT TO THE RETURNED INCOME OF THE ASSESSEE IS CONFIRMED AND THE GROUNDS OF APPEA L OF THE ASSESSEE AS WELL AS THE REVENUE BEING WITHOUT ANY MERIT ARE REJEC TED. 5. IN THE RESULT BOTH THE APPEALS OF THE ASSESSEE AND THE REVENUE ARE DISMISSED. ORDER PRONOUNCED IN THE COURT ON 8.7.2011 SD/- SD/- (CHANDRA POOJARI) ( G.C. G UPTA) ACCOUNTANT MEMBER VICE PRESIDENT DATED 8 .07.2011 ITA NO.726 A ND 527/HYD/2010 SMT. M.SUDHA HYDERABAD 6 COPY FORWARDED TO: 1. SMT. M.SUDHA C/O. SHRI S.RAMA RAO FLAT NO.102 SHIRYA'S ELEGANCE NO.3-6-643 STREET NO.9 HIMAYATNAGAR HYDERABAD 500029 2. INC OME - TAX OFFICER CIRCLE 4 (1) HYDERABAD 3. CIT (A) - V HYDERABAD . 4. COMMISSIONER OF INCOME-TAX-IV HYDERABAD 5. THE D.R. ITAT HYDERABAD. B.V.S.