Smt T.Nanda Vardhan, Secunderabad v. ACIT, Hyderabad

ITA 862/HYD/2003 | 1997-1998
Pronouncement Date: 28-07-2011 | Result: Partly Allowed

Appeal Details

RSA Number 86222514 RSA 2003
Assessee PAN ABXPT7109B
Bench Hyderabad
Appeal Number ITA 862/HYD/2003
Duration Of Justice 8 year(s) 1 month(s) 22 day(s)
Appellant Smt T.Nanda Vardhan, Secunderabad
Respondent ACIT, Hyderabad
Appeal Type Income Tax Appeal
Pronouncement Date 28-07-2011
Appeal Filed By Assessee
Order Result Partly Allowed
Bench Allotted B
Tribunal Order Date 28-07-2011
Date Of Final Hearing 06-07-2011
Next Hearing Date 06-07-2011
Assessment Year 1997-1998
Appeal Filed On 05-06-2003
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD A BENCH HYDERABAD BEFORE SHRI G.C. GUPTA VICE PRESIDENT AND SHRI CHANDRA POOJARI ACCOUNTANT MEMBER ITA NO.862/H/2003 ASSESSMENT YEAR 1997-98 ITA NO.1092/H/2003 ASSESSMENT YEAR 1998-99 ITA NO.1086/H/2003 ASSESSMENT YEAR 1999-00 ITA NO.30/H/2005 ASSESSMENT YEAR 1997-98 ITA NO.31/H/2005 ASSESSMENT YEAR 1998-99 ITA NO.32/H/2005 ASSESSMENT YEAR 1999-00 SMT. T. NANDA VARDHAN HYDERABAD (PAN ABXPT 7109 B) VS THE ACIT RANGE 13(1) HYDERABAD APPELLANT RESPONDENT APPELLANT BY : SHRI G. KRISHNA MURTHY RESPONDENT BY : SHRI G. PRASAD REDDY ORDER PER BENCH ALL THESE SIX APPEALS PREFERRED BY THE ASSESSEE ARE DIRECTED AGAINST THE DIFFERENT ORDERS PASSED BY THE CIT(A) II HYDERABAD AND PERTAINS TO THE ASSESSMENT YEARS 1997- 98 1998-99 1999-2000. SINCE ISSUES INVOLVED IN A LL THESE APPEALS ARE COMMON IN NATURE THEY ARE CLUBBED TOGET HER HEARD TOGETHER AND DISPOSED OFF VIDE THIS COMMON OR DER FOR THE SAKE OF CONVENIENCE. 2. FIRST WE WILL TAKE UP THE APPEAL IN ITA NO.862/H/2003. THE FIRST GROUND RAISED BY THE ASSE SSEE IN ITS APPEAL IS THAT THE CIT(A) ERRED IN CONFIRMING T HE ADDITION MADE U/S 69 OF THE ACT TOWARDS THE INVESTMENT IN HO USE PROPERTY AMOUNTING TO RS.3 35 000/- WITHOUT APPRECI ATING THE REAL AND TRUE FACTS AND WITHOUT GIVING AN OPPOR TUNITY OF EXPLAINING THE SAME. ITA NO.862 & OTHER 5 APPEALS/H/2003 05 SMT. T. NANDA VARDHAN HYDERABAD 2 3. BRIEF FACTS OF THE ISSUE ARE THAT THE ASSESSEE HAS SHOWN IN THE SALE DEED DATED 29.1.1997 AT RS.2.80 L AKHS AS PURCHASE COST OF THE HOUSE PROPERTY. HOWEVER I T WAS FOUND OUT THAT THE ASSESSEE HAS ENTERED INTO AN AGR EEMENT WITH MRS. ESTHER PRABHAKAR FOR PURCHASE OF THE SAI D HOUSE PROPERTY FOR A SALE CONSIDERATION OF RS.6.15 LAKHS. THE SALE AGREEMENT WAS EXECUTED ON A STAMP PAPER ON 11.2.199 6 AND THE SAME WAS DULY SIGNED BY BOTH THE PARTIES. THE DOCUMENT WAS ALSO PRODUCED BEFORE THE GIC HOUSING FINANCE LTD. AND AVAILED A LOAN OF RS.2 20 000/-. THIS FACT WAS CONFIRMED BY SHRI T. SRINIVAS ONE OF THE OFFIC ERS OF GIC HOUSING FINANCE LTD. IN DEPOSITION UNDER OATH ON 16.5.2001. HOWEVER THE ASSESSEE ON CONFRONTATION HAS SUBMITTED THAT THE ACTUAL CONSIDERATION WAS RS.2.80 LAKHS AND THE AGREEMENT WAS MADE ONLY FOR OBTAINING HIGHE R LOAN FROM THE HOUSING FINANCE. THE ASSESSEE ALSO STATED THAT SHE WAS UNABLE TO SUBSTANTIATE HER CLAIM SINCE THE SELLER OF THE HOUSE SMT. E. PRABHAKAR IS NO MORE. THUS THE A DDITION OF RS.3.35 LAKHS WAS MADE. THE CIT(A) HAS CONFIRME D THE SAME AND AGAINST THIS THE ASSESSEE IS IN APPEAL BEF ORE US. 4. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE MATERIALS AVAILABLE ON RECORD. THE ASSESSEES COUN SEL HAS MADE THE SAME SUBMISSIONS WHAT HE HAD MADE BEFORE T HE LOWER AUTHORITIES AND ACCORDING TO HIM TO INVOKE TH E PROVISIONS OF SECTION 69 THE CONDITIONS HEREIN ARE NOT FULFILLED. AFTER CONSIDERING THE ENTIRE FACTS AND CIRCUMSTANCES OF THE CASE IN OUR OPINION IT IS ES TABLISHED THAT THE SALE CONSIDERATION ACTUALLY PAID BY THE AS SESSEE IS MORE THAN WHAT WAS DISCLOSED BY HER TO THE DEPARTME NT. BEING SO THE REVENUE NEED NOT REQUIRED TO SHOW THE UNDER ITA NO.862 & OTHER 5 APPEALS/H/2003 05 SMT. T. NANDA VARDHAN HYDERABAD 3 STATEMENT BY ANY OTHER FRESH EVIDENCE. THERE IS A VALID AGREEMENT SIGNED BY BOTH THE PARTIES FOUND DURING T HE COURSE OF INVESTIGATION. THE PLEA OF THE ASSESSEE IS THAT THE SALE AGREEMENT WAS PREPARED ONLY TO AVAIL THE HIGHE R LOAN AMOUNT FROM GIC HOUSING FINANCE LTD. THIS ARGUMEN T OF THE ASSESSEES COUNSEL HAS NO LEGAL SANCTION. THER E IS A VALID DOCUMENT IN THE FORM OF SALE AGREEMENT AND TH E SAME IS TO BE CONSIDERED AS GENUINE ONE AND ON THAT BASI S OF THIS SALE CONSIDERATION UNDERSTATEMENT HAS BEEN DETERMIN ED BY THE ASSESSING OFFICER. IN OUR OPINION WE HAVE NO OPTION OTHER THAN CONSIDERING THE SIGNED AGREEMENT DATED 11.12.1996 FOUND DURING THE COURSE OF INVESTIGATION AS AGREEMENT ENTERED BETWEEN THE TWO PARTIES AND WHICH IS AN ACTUAL ONE AND ON THAT BASIS THE ASSESSMENT IS FRAM ED IS TO BE CONFIRMED. HENCE THIS GROUND OF THE ASSESSEE S TANDS DISMISSED. 5. THE SECOND GROUND WAS NOT PRESSED BY THE ASSESS EE AND THE SAME IS DISMISSED AS NOT PRESSED. 6. THE THIRD GROUND IS THAT THE CIT(A) ERRED IN NO T APPRECIATING THE SUBMISSIONS MADE AND CONFIRMED THE DISALLOWANCE OF RS.10 080/- RECEIVED FROM SHRI SUNI L BEING THE REPAYMENT OF HAND LOAN BY HIM. 7. THE ASSESSEE HAS SHOWN A RECEIPT OF RS.10 080/- ON 13.7.1996 BY WAY OF A CHEQUE. THE ASSESSEE HAS TAK EN A PLEA THAT THIS WAS THE REPAYMENT OF LOAN BY MR. SUN IL WHICH WAS ADVANCED TO HIM ON 9.7.1996. ITA NO.862 & OTHER 5 APPEALS/H/2003 05 SMT. T. NANDA VARDHAN HYDERABAD 4 8. ACCORDING TO THE ASSESSING OFFICER THE ADVANC E WAS NOT REFLECTED IN THE CASH FLOW STATEMENT. THE ASSESSEE HAS TAKEN A PLEA THAT THE ADVANCE WAS MADE ONLY RS.10 000/-. HOWEVER RS.10 080/- WAS RETURNED WI THIN FIVE DAYS THROUGH A CHEQUE. FURTHER THE ASSESSING OFFICER HAS OBSERVED THAT ADVANCING OF CASH LOAN OF RS.10 0 00/- WAS NOT REFLECTED IN THE CASH FLOW STATEMENT/BOOKS OF ACCOUNT OF THE ASSESSEE AS THERE WAS NO CASH BALANC E. ON THE OTHER HAND THERE IS A DEFICIT CASH BALANCE OF RS.31 844/- ON THAT DATE. ACCORDINGLY HE ADDED RS.10 000/- AS INCOME OF THE ASSESSEE. 9. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE MATERIALS AVAILABLE ON RECORD. THE CONTENTION OF THE ASSESSEES COUNSEL IS THAT THE REPAYMENT OF LOAN WA S CONFIRMED BY SHRI SUNIL AND HE IS HAVING THE SOURCE OF INCOME AS HE WAS WORKING IN A PRIVATE FIRM ON A MON THLY SALARY OF RS.4000 TO 8000/- AND IT CANNOT BE ADDED IN THE HANDS OF THE ASSESSEE. WE FIND NO FORCE IN THE ARG UMENTS OF THE ASSESSEES COUNSEL. ADVANCE OF LOAN WAS NOT RE FLECTED IN THE CASH FLOW STATEMENT OF THE ASSESSEE. THE ASSES SEE HAS RECEIVED RS.10 080/- WITHIN 5 DAYS OF THE IMPUGNED ADVANCE OF RS.10 000/- IN THE FORM OF A CHEQUE. TH ERE WAS NO EVIDENCE REGARDING ADVANCING OF LOAN BY THE ASSE SSEE. THE BANK ACCOUNT OF MR. SUNILS WAS NOT FURNISHED B Y THE ASSESSEE TO THE LOWER AUTHORITIES FOR EXAMINATION. BEING SO IN OUR OPINION THE ASSESSEES ARGUMENT IS ONLY AN AFTERTHOUGHT TO COVER UP THE DISCREPANCIES. ACCORD INGLY WE CONFIRM THE ADDITIONS. ITA NO.862 & OTHER 5 APPEALS/H/2003 05 SMT. T. NANDA VARDHAN HYDERABAD 5 10. THE FOURTH GROUND IN THE ASSESSEES APPEAL IS THAT THE CIT(A) ERRED IN CONFIRMING THE DISALLOWANCE OF RS.1 5 000/- BEING THE GIFTS RECEIVED FROM THE DONORS IGNORING T HE CONFIRMATION LETTERS FILED AND THE SUBMISSIONS MADE . 11. THE ASSESSEE SAID TO HAVE BEEN RECEIVED GIFTS FROM THE FOLLOWING PARTIES: 1. SHRI JOHNSON RS.5000 (12.9.1996) 2. SHRI JOHNSON RS.5000/- (28.9.1996) 3. SHRI MPN VIJAYAKUMAR RS 5000 (8.9.1996) 11.1. REGARDING THE RECEIPTS OF THE ABOVE GIFTS T HE ASSESSEE HAS FILED CONFIRMATION LETTERS. HOWEVER THE ASSES SEE HAS NOT ABLE TO FURNISH THE OCCASION ON WHICH THE GIFTS HAVE BEEN EXCHANGED BETWEEN THE PARTIES. THE ASSESSEE N EITHER ABLE TO PRODUCE DETAILS OF SOURCES OF SUCH GIFTS RE CEIVED NOR COPY OF BANK ACCOUNT BEFORE THE LOWER AUTHORITIES F OR EXAMINATION. BEING SO THE ADDITION WAS CONFIRMED BY CIT(A). 12. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE MATERIALS AVAILABLE ON RECORD. AS STATED BY THE LO WER AUTHORITIES THE ASSESSEE WAS NOT ABLE TO PRODUCE T HE OCCASIONS ON WHICH THESE GIFTS ARE GIVEN AND ALSO T HE ASSESSEE WAS NOT ABLE TO SPELL OUT ANY RELATIONSHIP BETWEEN THE PARTIES WITH SUPPORTING EVIDENCE THOUGH THE AS SESSEE HAS TAKEN A PLEA THAT THEY ARE CLOSE RELATIVES. BY PLACING RELIANCE ON THE JUDGEMENT IN THE CASE OF MOHANKALA VS. CIT (291 ITR 278) (SC) WE DISMISS THE GROUND TAKEN BY T HE ASSESSEE ON THIS ISSUE. ITA NO.862 & OTHER 5 APPEALS/H/2003 05 SMT. T. NANDA VARDHAN HYDERABAD 6 13. THE FIFTH GROUND TAKEN BY THE ASSESSEE IN ITS APPEALS IS THAT THE CIT(A) ERRED IN IGNORING THE REVISED F UND FLOW STATEMENT AND CONFIRMED THE DISALLOWANCE OF RS.56 330/- BEING THE PEAK CASH DEFICIT WITHOUT GIVING AN OPPOR TUNITY FOR EXPLAINING THE SAME. 14. THE LEARNED COUNSEL FOR THE ASSESSEE HAS SUBMI TTED THAT THERE WAS A DEFICIT CASH BALANCE IN THE ORIGIN AL CASH FLOW STATEMENT. HOWEVER THE ASSESSEE HAS FILED A REVISED CASH FLOW STATEMENT WHICH HAS TO BE CONSIDERED AS I N THE CASE OF HER HUSBAND BEEN CONSIDERED BY THE TRIBUNAL VIDE ITS ORDER DATED 3.9.2010 IN ITA NOS. NOS.1091 1200 1084/H/2003 28 &29/HYD/2005 WHEREIN HELD AS FOLLOW S: PARA 18: WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. WE FIND THAT THE ASSESSEE HAS STATED BEFORE THE CIT (A) THAT THE ORIGINAL CASH FLOW STATEMENT WAS PREPARED IN HASTE AND NOT IN SCIENTIFIC MANNER WITHOUT RECOURS E TO THE FACTUAL POSITION AND THE ASSESSING OFFICER HAS FAILED TO TAKE COGNIZANCE OF THE REVISED CASH FLOW STATEMENT PREPARED WHEREIN THE CORRECT ENTRIES WERE MADE AND WHICH CLEARLY ESTABLISHED THAT THERE WAS N O NEGATIVE CASH BALANCE AT ALL. WE FIND THAT THE ARGUMENT OF THE LEARNED COUNSEL FOR THE ASSESSEE TH AT ONCE THE REVISED CASH FLOW STATEMENT IS TAKEN INTO CONSIDERATION THEN THERE REMAINS NO PEAK DEFICIT O R NEGATIVE CASH BALANCE AT ALL COULD NOT BE CONTROVER TED BY THE REVENUE. THERE SEEMS TO BE NO VALID REASON FOR NOT TAKING INTO CONSIDERATION THE REVISED CASH FLOW STATEMENT FILED BY THE ASSESSEE. IN THESE FACTS OF THE ITA NO.862 & OTHER 5 APPEALS/H/2003 05 SMT. T. NANDA VARDHAN HYDERABAD 7 CASE WE HAVE NO HESITATION IN DELETING THE AMOUNT OF RS.1 07 044/- MADE BY THE ASSESSING OFFICER AND ACCORDINGLY THIS GROUND OF THE APPEAL OF THE ASSESS EE IS ALLOWED. 15. ON THE OTHER HAND THE LEARNED DEPARTMENTAL REPRESENTATIVE RELIED ON THE ORDER OF THE LOWER AUT HORITIES. 16. WE HAVE HEARD BOTH THE PARTIES AND PERUSED MATERIALS AVAILABLE ON RECORD. CONSIDERING THE ABO VE ORDER OF THIS TRIBUNAL CITED SUPRA WE DIRECT THE ASSESSI NG OFFICER TO CONSIDER THE REVISED CASH FLOW STATEMENT AND COM PLETE THE ASSESSMENT ACCORDINGLY. THIS GROUND OF THE ASS ESSEE IS ALLOWED FOR STATISTICAL PURPOSE. 17. THE SIXTH GROUND OF THE APPEAL OF THE ASSESSE E IS THAT THE CIT(A) ERRED IN IGNORING THE REVISED FU ND FLOW STATEMENT AND CONFIRMED THE ADDITION OF RS.1 LAKH T OWARDS FIXED DEPOSIT AS UNEXPLAINED INVESTMENT U/S 69 OF T HE ACT WITHOUT GIVING AN OPPORTUNITY FOR EXPLAINING THE SA ME. 18. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE MATERIALS AVAILABLE ON RECORD. ACCORDING TO LEARNE D AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE THIS AM OUNT WAS RECEIVED BY THE ASSESSEE OUT OF FIXED DEPOSIT M ATURED IN HER HUSBANDS AND FILED A COPY OF HER HUSBANDS BAN K ACCOUNT STATEMENT. WE HAVE GONE THROUGH THE MATERI ALS AVAILABLE ON RECORD. THE CASH BALANCE IN THE HANDS OF HER HUSBAND AS ON 2.3.1997 WAS AT RS.59 850/-. HENCE A S OBSERVED BY THE LOWER AUTHORITIES SHRI VARDHAN CAN NOT MAKE ADVANCE OF RS.1 LAKH TO THE ASSESSEE. MORE SO AN ITA NO.862 & OTHER 5 APPEALS/H/2003 05 SMT. T. NANDA VARDHAN HYDERABAD 8 AMOUNT OF RS.1 LAKH WAS NOT REFLECTED IN THE CASH F LOW STATEMENT OF SHRI VARDHAN. HOWEVER THE ASSESSEES CONTENTION NOW IS THAT THE TRIBUNAL HAS ACCEPTED TH E REVISED CASH FLOW STATEMENT IN THE CASE OF MR. T.J. P.S. VARDHAN (SUPRA) AND HENCE THE SAME IS TO BE CONSIDE RED. IN VIEW OF THIS WE DIRECT THE ASSESSING OFFICER TO CONSIDER THE REVISED CASH FLOW STATEMENT OF SHRI VARDHAN AND DECIDE THE ISSUE ACCORDINGLY. 19. IN THE RESULT THE APPEAL IN ITA NO.862/HYD/20 03 IS PARTLY ALLOWED FOR STATISTICAL PURPOSE. 20. NOW LET US TAKE THE NEXT APPEAL IN ITA NO.1092/H/2003 21. THE FIRST GROUND IN THIS APPEAL IS THAT THE CI T(A) ERRED IN CONFIRMING THE ADDITION OF RS.95 606/- UNDER THE HEAD CHEQUES WITHOUT SOURCES COMPRISING OF 4 ITEMS AS NOT SATISFACTORILY EXPLAINED WITHOUT APPRECIATING THE REAL AND TRUE FACTS AND ALSO WITHOUT GIVING AN OPPORTUNITY O F EXPLAINING THE SAME. 22. BRIEF FACTS OF THE ISSUE ARE THAT THE CREDITS UNDER THE HEAD CHEQUES WITHOUT SOURCES WERE SATISFACTORILY NOT EXPLAINED AND SO MADE THE ADDITION U/S 68 OF THE AC T. IN THE ASSESSMENT ORDER THE ASSESSING OFFICER HAS HEL D THAT IN THE CONSOLIDATED RECEIPTS AND PAYMENTS ACCOUNT FOR THE FINANCIAL YEAR 1997-98 RELEVANT TO THE YEAR UNDER CONSIDERATION FILED BY THE ASSESSEE HE STATED THAT SPECIFIC SOURCES ARE NOT AVAILABLE IN RESPECT OF VARIOUS CHE QUES DEPOSITED IN THE BANK ACCOUNT OF THE ASSESSEE AGGRE GATING ITA NO.862 & OTHER 5 APPEALS/H/2003 05 SMT. T. NANDA VARDHAN HYDERABAD 9 TO RS.1 03 609/-. THEREFORE THE ASSESSEE WAS DIRE CTED TO FURNISH EXPLANATION IN RESPONSE TO WHICH LETTER DAT ED 28.2.2002 WAS FILED. FROM THAT THE ASSESSING OFFIC ER HELD THAT A SUM OF RS.6000/- (3000 + 1000 + 2000) WAS GI FT RECEIVED FROM ONE SRI SUNEEL ON VARIOUS DATES. SIM ILARLY RS.2000/- WAS ALSO GIFT RECEIVED FROM SHRI MPN VIJA YA KUMAR. ACCORDINGLY THE ASSESSING OFFICER ALLOWED RS.8000/- AS EXPLAINED FROM THE ABOVE AMOUNT OF RS.1 03 609/- AND HELD THAT IN RESPECT OF THE BALAN CE OF RS.95 609/- THE ASSESSEE HAS NO EXPLANATION AS TO T HE SOURCE THEREOF. CONSEQUENTLY THE ASSESSING OFFICE R MADE THE ABOVE ADDITION. AGAINST THE SAID ADDITION MADE BY THE ASSESSING OFFICER THE CLAIM OF THE ASSESSEE BEFORE THE ASSESSING OFFICER WAS RS.4 609/- RECEIPT OF INCIDEN TAL EXPENSES FOR ATTENDING THE WORKS RS.10 000 REPRESE NTS AMOUNT PAID BY ONE SHRI NEELAIAH AND RS.80 000 WAS HAND LOAN GIVEN BY ONE SHRI MD. AB. KHAN. AS REGARDS RS.4 609/- CLAIMED AS RECEIPT OF INCIDENTAL EXPENSE S THE ASSESSING OFFICER HELD THAT THE ASSESSEE HAS NOT FU RNISHED ANY DETAILS AND THE ADDITION WAS MADE. AS REGARDS RS.10 000/- BEING THE ALLEGED AMOUNT REPAID BY SRI NEELAIAH THE ASSESSEE FAILED TO PRODUCE BEFORE THE ASSESSING OFFICER THE BANK ACCOUNT FROM WHICH CHEQU E WAS ISSUED BY THE SAID PERSON AS WELL AS THE NAME OF TH E ACCOUNT HOLDER AND OTHER RELEVANT DETAILS AND THERE FORE THE ASSESSING OFFICER DID NOT ACCEPT THE EXPLANATION AS SATISFACTORY AND TREATING THE ABOVE AS UNEXPLAINED HE MADE THE ADDITION. AS REGARDS RS.80 000/- ALLEGEDLY BE ING THE AMOUNT OF HAND LOAN RECEIVED IN CASH FROM MD. AB KH AN THE ASSESSING OFFICER DID NOT FIND THE CONFIRMATION LETTER FILED BY THE ASSESSEE AS SATISFACTORY AS RELEVANT SUPPORTING ITA NO.862 & OTHER 5 APPEALS/H/2003 05 SMT. T. NANDA VARDHAN HYDERABAD 10 EVIDENCES WERE NOT FURNISHED BEFORE HIM AND THEREFO RE THE ADDITION WAS MADE. 23. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE MATERIALS AVAILABLE ON RECORD. REGARDING THE RECEI PT OF RS.4 609/- THE ASSESSEE HAS TAKEN A PLEA THAT THIS AMOUNT IS INCIDENTAL EXPENSES FOR ATTENDING MENIAL WORKS W HICH IS NOTHING BUT REIMBURSEMENT. HOWEVER THE ASSESSEE H AS NOT ABLE TO FURNISH ANY SUPPORTING DOCUMENTS REGARDING REIMBURSEMENT OF THE SAID AMOUNT. ACCORDINGLY THE SAME WAS REJECTED BY ASSESSING OFFICER. MORESO THE ASS ESSEE NOT ABLE TO FURNISH THE SUPPORTING EVIDENCE AND THE CONFIRMATION LETTER FILED BY THE ASSESSEE DID NOT F IND SATISFACTORY WITH REGARD TO THE IMPUGNED HAND LOAN OF RS.80 000/-. 24. REGARDING REPAYMENT OF RS.10 000/- BY SHRI NEE LAIAH FROM MRS. NANDA VARDHAN NO DETAILS HAVE BEEN FURNI SHED AS TO WHEN THE SAID LOAN WAS GIVEN EXCEPT STATING T HAT IT WAS GIVEN IN THE IMMEDIATE PREVIOUS YEAR. SINCE TH E ASSESSEE HAS NOT ABLE TO FURNISH ANY SUPPORTING EVI DENCE THE GROUND OF THE ASSESSEE ON THIS ISSUE STANDS REJ ECTED. SIMILARLY NO EVIDENCE HAS BEEN PRODUCED REGARDING THE DEPOSIT OF RS.10 000/-. ACCORDINGLY THE ADDITIONS IS CONFIRMED. 25. THE SECOND GROUND IN THE ASSESSEES APPEAL IS THAT THE CIT(A) ERRED IN CONFIRMING THE ADDITION OF RS.20 93 7/- UNDER THE HEAD PEAK CASH DEFICIT IGNORING THE AVE RMENTS MADE BEFORE HIM AND ALSO WITHOUT PROPER APPRECIATIO N OF THE TRUE AND CORRECT FACTS OF THE CASE. ITA NO.862 & OTHER 5 APPEALS/H/2003 05 SMT. T. NANDA VARDHAN HYDERABAD 11 26. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE MATERIALS AVAILABLE ON RECORD. THE CONTENTION OF T HE ASSESSEES COUNSEL IS THAT THE ASSESSEES HUSBANDS REVISED CASH FLOW STATEMENT IS TO BE CONSIDERED. WE ACCEDE THE REQUEST OF THE ASSESSEES COUNSEL. AS DECIDED BY T HE TRIBUNAL IN THE CASE CITED SUPRA WE DIRECT THE ASS ESSING OFFICER TO CONSIDER THE REVISED CASH FLOW STATEMENT OF SHRI VARDHAN ASSESSEES HUSBAND AND SHRI BABU. ACCORDI NGLY THE GROUND TAKEN BY THE ASSESSEE ON THIS ISSUE IS A LLOWED FOR STATISTICAL PURPOSES. 27. THE THIRD GROUND OF THE APPEAL OF THE ASSESSEE IS THAT THE CIT(A) ERRED IN CONFIRMING THE ADDITION OF RS.4 8 000/- UNDER THE HEAD DRAWINGS WITHOUT RECOURSE TO THE F ACTS OF THE CASE AND ITS PROPER APPRECIATION. 28. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE MATERIALS AVAILABLE ON RECORD. THE ASSESSEE HAS S HOWN WITHDRAWALS OF RS.24 000/-. ACCORDING TO ASSESSING OFFICER WHICH IS VERY LOW AND HENCE MADE ADDITION OF RS.48 000/-. THIS IS AN AD HOC ADVANCE AND IN OUR OPINION TO ME ET THE ENDS OF JUSTICE WE DIRECT THE ASSESSING OFFICER TO MAKE ADDITION ON RS.24 000/- ONLY INSTEAD OF RS.48 000/- . ACCORDINGLY THIS GROUND OF THE ASSESSEE IS PARTLY ALLOWED. 29. IN THE RESULT THE APPEAL IN ITA NO.1092/H/2003 IS PARTLY ALLOWED. 30. NOW LET US TAKE THE THIRD APPEAL OF THE ASSES SEE IN ITA NO.1086/H/2003. ITA NO.862 & OTHER 5 APPEALS/H/2003 05 SMT. T. NANDA VARDHAN HYDERABAD 12 31. THE FIRST GROUND IN THIS APPEAL IS THAT THE CI T(A) ERRED IN CONFIRMING THE ADDITION OF RS.1 51 805/- U/S 68 OF THE ACT UNDER THE HEAD CHEQUES WITHOUT SOURCES COMPRI SING OF 9 ITEMS AS NOT SATISFACTORILY EXPLAINED WITHOUT AP PRECIATING THE REAL AND TRUE FACTS AND ALSO WITHOUT GIVING AN OPPORTUNITY OF EXPLAINING THE SAME. 32. BRIEF FACTS OF THE ISSUE ARE THAT THE ASSESSIN G OFFICER FAILED TO APPRECIATE THE FACT THAT THE CREDITS UNDE R THE HEAD CHEQUES WITHOUT SOURCES WERE SATISFACTORILY EXPLA INED BY WAY OF FILING CONFIRMATION LETTERS FROM THE CREDITO RS AND THAT THE ASSESSING OFFICER FURTHER FAILED TO APPRECIATE THE EVIDENCES FILED BEFORE HIM FOR WANT OF ADDITIONAL I NFORMATION WHICH COULD NOT BE FURNISHED BY THE ASSESSEE AND HE NCE DISALLOWED THE CLAIM AND ADDED THE AMOUNTS U/S 68 O F THE ACT. IN THIS CASE THE ASSESSING OFFICER NOTICED F ROM THE CONSOLIDATED RECEIPTS AND PAYMENTS ACCOUNT FOR THE YEAR UNDER CONSIDERATION FILED BY THE ASSESSEE THAT THE ASSESSEE COULD NOT EXPLAIN SATISFACTORILY SPECIFIC SOURCES F OR CHEQUES DEPOSITED IN HER ACCOUNT FROM 13.4.1998 TO 25.3.199 9 AGGREGATING TO RS.1 54 906/-. THE ASSESSING OFFICE R IN HIS LETTER DATED 4.4.2001 AND 14.3.2002 HAD ASKED THE A SSESSEE TO EXPLAIN WHY THE SAID AMOUNT OF RS.1 54 904 SHOUL D NOT BE TREATED AS UNEXPLAINED INCOME OF THE ASSESSEE. IN RESPONSE TO THIS THE ASSESSEE FILED LETTER DATED 22 .3.2002 AND EXPLANATION WAS OFFERED AS REGARDS THE SOURCE O F THE SAID CHEQUE. AS REGARDS GIFT OF RS.1 500/- RS.1 60 0/- RECEIVED FROM MRS. GRACE JOSEPH ON 13.4.1998 THE ASSESSING OFFICER WAS SATISFIED AS TO THE SOURCE IN VIEW OF THE CONFIRMATION LETTER FILED AND AFTER VERIFICATIO N OF BANK ITA NO.862 & OTHER 5 APPEALS/H/2003 05 SMT. T. NANDA VARDHAN HYDERABAD 13 ACCOUNT. WITH REGARD TO GIFTS STATED TO HAVE BEEN RECEIVED FROM RELATIVES OF RS.250 RS.2000 RESPECTIVELY ON 5 .10.98 AND 21.12.98 REPAYMENT OF LOAN BY MRS. BEULAH OF RS.13 000/- ON 30.1.1999 AND REIMBURSEMENT OF EXPEN SES OF WORKSHOPS OF RS.2631/- RS.21 000/- AND RS.977/- RESPECTIVELY ON 2.3.99 6.3.99 25.3.99 THE ASSESS ING OFFICER HELD THAT IN THE ABSENCE OF DETAILS AND SUP PORTING EVIDENCES THE ASSESSEES EXPLANATION AS TO THE SOUR CE THEREOF IS NOT SATISFACTORY. AS REGARDS THE AMOUN T OF RS.50 000/- ON 9.10.1998 STATED TO BE CONTRA ENTRY THE ASSESSING OFFICER HELD THAT AS NO DETAILS WERE FURN ISHED AS TO THE SOURCE OF IT IT IS TO BE TREATED AS ASSESSE ES INCOME AND NOT CONTRA ENTRY. AS REGARDS RS.51 948/- DATED 30.1.1999 ALLEGEDLY DEPOSITED OUT OF THE MATURITY PROCEEDINGS OF FDR THE ASSESSING OFFICER MADE THE ADDITION ON THE GROUND THAT THE ASSESSEE HAS NOT PR OVIDED ANY EVIDENCE AS TO WHEN THE FDR WAS TAKEN AND THE S OURCE THEREOF. ALSO THE ASSESSING OFFICER TOOK THE VIEW THAT THE CASH FLOW STATEMENT DULY REFLECTING THE AMOUNT OF F DR IN ASSESSEES CASE WAS NOT FURNISHED BEFORE HIM AND ACCORDINGLY THE ADDITION WAS MADE. 33. THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE HAS STATED THAT THE ADDITIONS HAVE FOLLOWI NG BREAKUPS: 33.1 THE AR SUBMITTED THAT AS REGARDS FROM THE REIMBURSEMENTS FROM WORKSHOPS IS CONCERNED THE ASS ESSEE ATTENDS VARIOUS WORKSHOPS AT DIFFERENT PARTS OF THE COUNTRY. DURING THE YEAR FOR THE VISITS MADE THE ASSESSEE W AS REIMBURSED A TOTAL SUM OF RS.24 608/- FROM SIDUR. AS THE ITA NO.862 & OTHER 5 APPEALS/H/2003 05 SMT. T. NANDA VARDHAN HYDERABAD 14 NECESSARY PARTICULARS COULD NOT BE FURNISHED THE A SSESSING OFFICER TREATED THE AMOUNT AS INCOME OF THE ASSESSE E. 33.2. AS REGARDS THE MATURITY DEPOSIT OF FDR FOR RS.51 948/- HE SUBMITTED THAT THIS AMOUNT WAS INVES TED BY MR. TPJS VARDHAN IN THE ASSESSMENT YEAR 1997-98 IN THE NAME OF THE ASSESSEE. THE MATURITY PROCEEDS OF THE SAME WERE CREDITED TO SB ACCOUNT WITH TRINITY COOPERATIV E URBAN BANK LTD. THIS AMOUNT OF RS.50 000/- WAS MADE BY M R. VARDHAN OUT OF HIS CASH BALANCE FROM THE REVISED FU ND FLOW STATEMENT FILED FOR THE ASSESSMENT YEAR 1997-98 IN HIS HANDS. THE ASSESSING OFFICER IGNORED THE SUBMISSIO NS AND MADE WITHOUT PROPER VERIFICATION CAME TO THE ERRONE OUS CONCLUSION THAT THIS AMOUNT WAS UNEXPLAINED AND BRO UGHT THE SAME TO TAX. 33.3. IN SO FAR AS THE HAND LOAN REPAID BY MRS. BEULAH FOR RS.13 000/- IS CONCERNED HE SUBMITTED TH AT THIS AMOUNT WAS GIVEN TO HER BY THE ASSESSEES HUSBAND M R. VARDHAN IN 1994 TO MEET HER PERSONAL EXPENSES. SHE IS A CLOSE RELATIVE OF THE ASSESSEE CO-SISTER IN LAW. THE CREDITOR MRS. BEULAH STAYS IN USA. THIS AMOUNT WAS REPAID B Y HER TO THE ASSESSEE FROM HER BANK ACCOUNT DURING THE LA TEST VISIT TO INDIA. THIS FACT WAS BROUGHT TO THE NOTI CE OF THE ASSESSING OFFICER WHO HAD IGNORED THE SAME. THIS A MOUNT MUST BE TREATED AS BONAFIDE AND GENUINE ON THE THEO RY OF PREPONDERANCE OF THE PROBABILITY AND THE ADDITION M ADE BY THE ASSESSING OFFICER. THE CIT(A) CONFIRMED THE AD DITION HENCE THE ASSESSEE IS IN APPEAL BEFORE THIS TRIBUNA L. ITA NO.862 & OTHER 5 APPEALS/H/2003 05 SMT. T. NANDA VARDHAN HYDERABAD 15 34. THE DEPARTMENTAL REPRESENTATIVE RELIED ON THE ORDER OF THE CIT(A). 35. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE MATERIALS AVAILABLE ON RECORD. REGARDING ADDITION OF RS.24 608/- THE EXPLANATION OFFERED BY THE ASSESSE E WAS NOT SATISFACTORY. THE ASSESSEE HAS NOT PRODUCED AN Y CONFIRMATION LETTER FROM SIDUR. BEING SO WE CONFI RM THE ADDITION ON THIS ISSUE. 36. REGARDING RECEIPT OF MONEY FROM HER HUSBAND AT RS.51 948/- WE SET ASIDE THE ISSUE TO THE FILE OF ASSESSING OFFICER TO CONSIDER THE REVISED FUND FLOW STATEMENT OF HER HUSBAND SHRI VARDHAN AND DECIDE THE ISSUE ACCORDING LY. 37. REGARDING HAND LOAN REPAID BY MRS. BEULAH FOR RS.13 000/- IS CONCERNED THE ASSESSEE HAS SUBMITTED THAT THIS AMOUNT WAS GIVEN TO HER BY HER HUSBAND MR. VAR DHAN IN 1994 TO MEET HER PERSONAL EXPENSES. THIS AMOUNT WAS REPAID BY HER TO THE ASSESSEE FROM HER BANK ACCOUNT DURING THE VISIT TO INDIA BY MRS. BEULAH WHO STAYS IN USA. HOWEVER THE ASSESSEE NOT ABLE TO PRODUCE OR FURNIS H ANY DOCUMENTS OR DETAILS OF CHEQUE NO. AND BANK ON WHIC H IT WAS DRAWN. SIMILARLY THE DETAILS OF CHEQUE NO. AN D BANK ACCOUNT OF REPAYMENT ALSO NOT FURNISHED BY THE ASSE SSEE. THE EXPLANATION OFFERED BY THE ASSESSEE IS NOT SATI SFACTORY. HENCE THIS ADDITION IS SUSTAINED. 38. REGARDING THE BALANCE ADDITION ALSO THERE IS NO SATISFACTORY EXPLANATION AND THE SAME IS CONFIRMED. ITA NO.862 & OTHER 5 APPEALS/H/2003 05 SMT. T. NANDA VARDHAN HYDERABAD 16 39. IN THE RESULT THE APPEAL OF THE ASSESSEE IN IT A NO.1086/H/2003 IS PARTLY ALLOWED. 40. NOW COMING TO THE ASSESSEES APPEALS IN ITA NOS.30 31 & 32/H/2005 THE MAIN GRIEVANCE OF THE ASSESSEE IN THESE APPEALS IS REGARD TO LEVY OF PEN ALTY U/S 271(1) (C) OF THE IT ACT. 41. IN ITA NO.30/H/2005 THE ASSESSEE WAS LEVIED PENALTY ON ACCOUNT OF UNEXPLAINED INVESTMENT IN TH E HOUSE PROPERTY AT RS.3.35 LAKHS UNEXPLAINED GIFT OF RS.8 000/- SAID TO BE RECEIVED FROM MR. NARAYANAN AND UNEXPLAI NED CREDIT OF RS.10 080/- SAID TO BE RECEIVED FROM SHRI SUNIL AND ANOTHER UNEXPLAINED GIFT OF RS.15 000/ RECEIVE D FROM MR. JOHNSON RS.5000/- AND RS.10 000/- SHRI M.P.N. V IJAYA KUMAR. 41.1. THE ASSESSEE HAS PURCHASED A HOUSE PROPERTY AT B-51/F1 VIJAYA NAGAR COLONY HYDERABAD ON 29.1. 1997. THE SALE CONSIDERATION MENTIONED IN THE SALE DEED I S RS.2.8 LAKHS WHEREAS AN AMOUNT OF RS.6.15 LAKHS EVIDENCED BY SALE AGREEMENT FOUND DURING THE COURSE OF INVESTIGA TION. THUS THERE WAS UNDER STATEMENT OF SALE CONSIDERATI ON TO THE TUNE OF RS.3.35 LAKHS. THIS ADDITION WAS CONFI RMED BY US IN EARLIER PARA OF THIS ORDER. FROM THE FACTS O F THE CASE THE UNDERSTATEMENT WAS PROVED BEYOND DOUBT AND ALSO SUPPORTED BY THE STATEMENT FURNISHED BY SHRI T. SRI NIVASA ONE OF THE OFFICERS OF THE GIC HOUSING FINANCE LIMI TED. THE PLEA OF THE ASSESSEE IS THAT THE SALE AGREEMENT WA S MADE ONLY TO AVAIL A HIGHER AMOUNT OF LOAN FROM THE GIC HOUSING FINANCE LTD. THIS PLEA OF THE ASSESSEE IS HAVING N O LEGAL ITA NO.862 & OTHER 5 APPEALS/H/2003 05 SMT. T. NANDA VARDHAN HYDERABAD 17 SANCTITY. THE EXPLANATION FURNISHED BY THE ASSESSE E IS NOT BONA FIDE AND ALSO UNSUBSTANTIATED ONE. THE ASSESS EE HIT BY EXPLANATION 1 TO SECTION 271(1) (C ) OF THE ACT. THE ASSESSEE HAS ALSO NOT ABLE TO FURNISH EVIDENCE THAT THERE EXISTS CIRCUMSTANCES WHICH DISABLED HIM TO FURNISH THE EVIDENCE IN SUPPORT OF HER CLAIM. FURTHER WE CANN OT HOLD THAT THE ASSESSEE HAS FURNISHED ALL MATERIAL FACTS RELATING TO HER ASSESSMENT. THE ASSESSEE HAS NOT ABLE TO EXPLA IN THE SOURCES FOR ADDITIONAL INVESTMENT AT RS.3.35 LAKHS IN THE IMPUGNED PROPERTY. IN OUR OPINION THIS IS A FIT C ASE TO LEVY PENALTY ON THIS ISSUE CONSIDERING THE TOTALITY OF F ACTS AND CIRCUMSTANCES OF THE CASE. THE ASSESSEE HAS NOT SH OWN ANY BONA FIDE EXPLANATION FOR THE DISCREPANCIES FOU ND BY THE AUTHORITIES. ACCORDINGLY WE CONFIRM THE LEVY OF PENALTY ON THIS ISSUE. 41.2. NOW COMING TO THE PENALTY WITH RESPECT TO OT HER 3 ITEMS OF UNEXPLAINED INCOME/GIFTS AS PER EXPLANATION SECTION 271 (1) (C ) OF THE ACT PROVIDES FOR DEEMIN G ADDITION AS CONCEALED INCOME OR INCOME IN RESPECT OF WHICH INACCURATE PARTICULARS HAVE BEEN FURNISHED PROVIDED CONDITIONS LAID DOWN IN EITHER OF THE CLAUSES ARE S ATISFIED. IF ASSESSEE DOES NOT FURNISH ANY EXPLANATION IN RESPE CT OF ADDITION MADE OR EXPLANATION FURNISHED IS FOUND FA LSE THEN CLAUSE (A) EXPLANATION 1 CAN BE INVOKED. WHERE ASS ESSEE FURNISHES AN EXPLANATION IN RESPECT OF ADDITION MAD E THEN AS PER CLAUSE (B) OF EXPLANATION 1 THE ADDITION WO ULD BE DEEMED AS CONCEALED INCOME OR INCOME IN RESPECT OF WHICH INACCURATE PARTICULARS HAVE BEEN FURNISHED PROVIDE D FOLLOWING THREE CONDITIONS ARE SATISFIED: ITA NO.862 & OTHER 5 APPEALS/H/2003 05 SMT. T. NANDA VARDHAN HYDERABAD 18 I) ASSESSEE IS NOT ABLE TO SUBSTANTIATE HIS EXPLANATION II) EXPLANATION FURNISHED BY HIM IS NOT BONA FIDE III) ALL THE MATERIAL FACTS NECESSARY FOR ASSESSMENT O R IN RESPECT OF EXPLANATION ARE NOT FURNISHED BY HIM. IF ASSESSEE IS ABLE TO SHOW PRIMA FACIE THAT SHE IS NEITHER HIT BY CLAUSE (A) OR BY CLAUSE. (B) OF EXPLANATION 1 THEN ONUS WILL SHIFT TO THE ASSESSING OFFICER THAT CONDITION LAID DOWN THEREIN ARE SATISFIED. IN RESPECT OF EXPLANATION 1 THE DEEMING FICTION IS RAISED AND ADDED/DISALLOWED AMOUNT IS TREATED AS THE INCOME IN RESPECT OF WHICH PARTICULARS HAVE BEEN CONCEALED. EXPLANATION 1(B) WILL NOT APPLY IF THE EXPLANATION GIVEN BY THE ASSESSEE IN THE QUANTUM PROCEEDINGS WHICH SHE C OULD NOT SUBSTANTIATE IN THOSE PROCEEDINGS WAS (I) BONA FIDE AND (II) SHE HAD DISCLOSED IN ALL THE FACTS RELATING TO THE SAME AND MATERIAL TO THE COMPUTATION OF HIS TOTAL INCOME . IN CASES WHERE EXPLANATION WAS OFFERED BUT WAS REJECT ED AS IT COULD NOT BE SUBSTANTIATED BY THE ASSESSEE THERE W OULD ARISE NO PRESUMPTION OF CONCEALMENT OF THE PARTICUL ARS OF INCOME THAT WAS ADDED OR DISALLOWED IF SUCH ASSESSE E CAN SHOW THAT THE SAID EXPLANATION OFFERED BY HIM WAS A BONA FIDE ONE AND THAT HE HAD DISCLOSED ALL FACTS RELATI NG TO SUCH EXPLANATION AND MATERIAL TO THE COMPUTATION OF HIS TOTAL INCOME DURING THE QUANTUM PROCEEDINGS. FOR BRINGIN G THE CASE UNDER THE MAIN PROVISION THE ONUS IS PUT ON TH E DEPARTMENT TO PROVE THAT THE ASSESSEE HAS CONCEALED THE PARTICULARS OF HER INCOME OR FURNISHED INACCURATE PARTICULARS THEREOF. TO BRING THE CASE OF THE ASSE SSEE WITHIN ITS MISCHIEF MERE REJECTION OF ASSESSEES CLAIM WO ULD NOT BE ITA NO.862 & OTHER 5 APPEALS/H/2003 05 SMT. T. NANDA VARDHAN HYDERABAD 19 SUFFICIENT AND THE ASSESSEE CANNOT BE HELD GUILTY O F CONCEALMENT. IT IS BY VIRTUE OF EXPLANATION THAT A SSESSING OFFICER CAN RAISE THE PRESUMPTION ABOUT ADDITIONS M ADE TO THE TOTAL INCOME OR DEDUCTION DISALLOWED THAT IT RE PRESENTS ASSESSEES CONCEALED INCOME OR THE INCOME IN RESPEC T OF WHICH ASSESSEE HAS FURNISHED INACCURATE PARTICULARS . WHEN WE EXAMINE PART B OF EXPLANATION 1 CAREFULLY THEN W E ARE OF THE VIEW THAT THE WORDS NOT SUBSTANTIATE USED IN THAT CLAUSE DOES NOT MEAN THAT IS NOT ACCEPTED BY THE CO NCERNED AUTHORITY BUT IT MEANS THAT THERE IS NO SUBSTANCE IN THE CLAIM MADE BY THE ASSESSEE. THE WORD SUBSTANTIATE IS OPPOSITE TO THE WORD VAGUE OR FANCIFUL OR WITH OUT ANY FOUNDATION OR BASIS. THE PHRASE TO PROVE THAT SU CH EXPLANATION IS BONA FIDE MEANS THAT THE ASSESSEE H AS TO SHOW THAT CIRCUMSTANCES EXISTED WHEREBY IT HAS MADE THE CLAIM OR THAT AS IN THE PRESENT CASE IT HAD IN F ACT RECEIVED THE MONEY FROM THE CREDITORS BUT THEIR CREDENTIALS CANNOT BE ESTABLISHED. IT HAS TO BE PROVED THAT FAILURE O F THE ASSESSEE TO FURNISH EVIDENCE IN SUPPORT THE CLAIM W AS BEYOND HIS CONTROL. ASSESSEE HAS TO PROVE OR FURNI SH EVIDENCE THAT CIRCUMSTANCES EXISTED WHICH DISABLED HIM TO FURNISH THE EVIDENCE IN SUPPORT OF HIS CLAIM. THE THIRD CONDITION IS THAT ALL THE FACTS RELATING TO THE CLA IM AND MATERIAL TO THE COMPUTATION OF ITS TOTAL INCOME HAS BEEN DISCLOSED BY HIM. IT MEANS THAT ALL THE MATERIAL F ACTS WHICH ARE RELEVANT FOR COMPUTATION OF INCOME OF THE ASSES SEE HAVE BEEN DISCLOSED TO THE DEPARTMENT NOT MERELY DURING THE ASSESSMENT PROCEEDINGS BUT IN THE RETURN OF INCOME. 41.3. WHEN WE EXAMINE THE FACTS OF THE PRESENT CA SE AS OBSERVED BY THE US IN THIS ORDER IN EARLIER P ARA THAT THE AMOUNTS FOUND TO BE UNEXPLAINED. THERE IS NO PROX IMITY OF ITA NO.862 & OTHER 5 APPEALS/H/2003 05 SMT. T. NANDA VARDHAN HYDERABAD 20 SOURCE WHATSOEVER. EVEN OTHERWISE THE ASSESSEE HA S NOT LED ANY EVIDENCE TO PROVE THE IDENTITY OF THE CREDI TOR THEIR CREDITWORTHINESS AND THE GENUINENESS OF THE TRANSA CTION. 41.4. ON EXAMINATION OF THE FACTS OF THE PRESENT C ASE RELATING TO THESE ADDITIONS THE ASSESSEE NOT ABLE TO SUBSTANTIATE HER CLAIM REGARDING THESE INCOME/RECEI PTS THERE IS NO SOURCES OF WHATSOEVER EVEN OTHERWISE T HE ASSESSEE HAS NOT LEAD ANY EVIDENCE TO PROVE THE IDE NTITY OF THE CREDITOR/DONOR CREDIT WORTHINESS AND GENUINENE SS OF THE TRANSACTIONS. THE ARGUMENTS OF THE ASSESSEES COUNSEL WILL NOT COME TO THE RESCUE OF THE ASSESSEE IT IS ONLY AN AFTERTHOUGHT TO COVER UP THE DISCREPANCIES. IN OUR OPINION LEVY OF PENALTY IN RESPECT OF THE ABOVE 3 ITEMS IS JUSTIFIED AND THE SAME IS CONFIRMED. 41.5. NOW COMING TO THE LEVY OF PENALTY IN RESPECT OF UNEXPLAINED FIXED DEPOSITS OF RS.1 LAKHS SINCE WE HAVE SET ASIDE THIS ISSUE TO THE FILE OF ASSESSING OFFICER F OR FRESH CONSIDERATION IN QUANTUM APPEAL IN THE EARLIER PARA AT THIS STAGE LEVY OF PENALTY IS NOT WARRANTED. HOWEVER T HE ASSESSING OFFICER IS AT LIBERTY TO CONSIDER THE SAM E WHILE PASSING THE CONSEQUENTIAL ASSESSMENT ORDER IF SITUA TION WARRANTS. 42. IN THE RESULT ITA NO.30/H/2005 IS PARTLY ALLOW ED. 43. NOW WE WILL TAKE UP THE APPEAL IN ITA NO.31/H/ 2005. IN THIS CASE THE PENALTY WAS LEVIED IN RESPECT OF C HEQUES WITHOUT SOURCES AT RS.95 609/- PEAK CASH DEFICIT O F RS.20 937/- AND LOW DRAWINGS OF RS.48 000/- ITA NO.862 & OTHER 5 APPEALS/H/2003 05 SMT. T. NANDA VARDHAN HYDERABAD 21 44. IN CASE OF LEVY OF PENALTY FOR UNEXPLAINED SOU RCE OF INCOME AT RS.95 609/- UNDER THE HEAD CHEQUES WITHOU T SOURCES THE ASSESSEE COULD NEITHER PRODUCE ANY SUP PORTING EVIDENCE NOR FURNISH THE BANK ACCOUNT FROM WHICH TH E CHEQUES WERE ISSUED. IN OUR OPINION LEVY OF PEN ALTY IS JUSTIFIED ON THIS ISSUE AS DISCUSSED IN EARLIER PAR S IN ITA NO.30/H/2005. IN CASE OF LEVY OF PENALTY IN RELAT ION TO ADDITION ON PEAK CASH DEFICIT IN THE CASH FLOW STAT EMENT SINCE WE HAVE SET ASIDE THIS ISSUE TO CONSIDER THE REVISED CASH FLOW STATEMENT LEVY OF PENALTY AT THIS STAGE IS NOT JUSTIFIED. 45. REGARDING LOW DRAWINGS THIS IS ONLY AN AD HOC ADDITION ON ESTIMATE BASIS. IN OUR OPINION THE AD HOC ADDITION DOES NOT WARRANT LEVY OF PENALTY. 46. IN THE RESULT THE APPEAL IN ITA NO.31/H/2005 IS PARTLY ALLOWED. 47. NOW WE WILL TAKE THE APPEAL IN ITA NO.32/H/2 005. IN THE CASE THE PENALTY WAS LEVIED IN RESPECT OF TH E FOLLOWING ADDITIONS: CHEQUES RECEIVED WITHOUT SPECIFIC SOURCES: RS.1 51 805/- DATE AMOUNT SOURCE 13.4.98 1 500 MRS. GRACE BAI JOSEPH 13.4.98 1 600 MRS. GRACE BAI JOSEPH 22.8.98 10 000 HAND LOAN REPAID BY MRS. PRABHAKAR 5.10.98 250 RELATIVES 9.10.98 50 000 CONTRA ITEM 21.12.98 2 000 GIFTS FROM RELATIVES 30.1.99 51 948 MATURITY DEPOSIT OF FDR ITA NO.862 & OTHER 5 APPEALS/H/2003 05 SMT. T. NANDA VARDHAN HYDERABAD 22 30.1.99 13 000 REPAYMENT OF HAND LOAN FROM MRS. BEULAH 2.3.99 2 631 REIMBURSEMENT OF EXPENSES FROM WORKSHOPS 6.3.99 21 000 REIMBURSEMENT OF EXPENSES FROM WORKSHOP 25.3.99 977 REIMBURSEMENT OF EXPENSES FROM WORKSHOP TOTAL 1 54 906 48. WHILE DECIDING THE QUANTUM ADDITIONS IN THIS ASSESSMENT YEAR WE HAVE CONFIRMED THE ADDITION EX CEPT ADDITION IN RESPECT OF MATURITY DEPOSIT OF FDR FRO M HER HUSBAND AT RS.51 948/-. REGARDING CONFIRMED ADDITI ONS THE ASSESSEE HAS NEITHER FURNISHED ANY DETAILS NOR OF ANY SUPPORTING DOCUMENTS IN CONNECTION WITH THESE ADDIT IONS. THE EXPLANATION OFFERED BY THE ASSESSEE WAS NOT SATISFACTORY. AS DISCUSSED IN EARLIER PARAS IN ITA NO.30/H/2005 WE CONFIRM THE LEVY OF PENALTY ON THE BALANCE AMOUNTS ON THE SAME REASONS. IN THE RESULT THE APPEAL OF THE ASSESSEE IN ITA NO.32/H/2005 IS PARTL Y ALLOWED. 49. IN THE RESULT THE ASSESSEES APPEALS IN ITA N OS.862 1092 1086/HYD/2003 AND ITA NOS.30 TO 32/HYD./200 5 ARE PARTLY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT 28. 7.2011 SD/- SD/- G.C. GUPTA CHANDRA POOJARI VICE PRESIDENT ACCOUNTANT M EMBER DATED THE 28 TH JULY 2011 ITA NO.862 & OTHER 5 APPEALS/H/2003 05 SMT. T. NANDA VARDHAN HYDERABAD 23 COPY FORWARDED TO: 1. M/S G. KRISHNA MURTHY & CO. C AS 133/1 P.G. ROAD SECUNDERABAD C/O SMT. T. NANDA VARDHAN HYDERABAD 2. THE ACIT RANGE 13(1) HYDERABAD 3. THE CIT(A) II HYDERABAD 4. THE CIT HYDERABAD 5. THE DR ITAT HYDERABAD NP/