NEVILLE RUSTOM JOSHI, MUMBAI v. DCIT CEN CIR 39, MUMBAI

ITA 8666/MUM/2010 | 2005-2006
Pronouncement Date: 25-02-2011 | Result: Allowed

Appeal Details

RSA Number 866619914 RSA 2010
Assessee PAN AFKPJ2061B
Bench Mumbai
Appeal Number ITA 8666/MUM/2010
Duration Of Justice 2 month(s) 12 day(s)
Appellant NEVILLE RUSTOM JOSHI, MUMBAI
Respondent DCIT CEN CIR 39, MUMBAI
Appeal Type Income Tax Appeal
Pronouncement Date 25-02-2011
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted SMC
Tribunal Order Date 25-02-2011
Assessment Year 2005-2006
Appeal Filed On 13-12-2010
Judgment Text
1 ITA NO.8666/MUM/2010 IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI MUMBAI MUMBAI MUMBAI SMC SMC SMC SMC BENCH BENCH BENCH BENCH MUMBAI BENCHES MUMBAI MUMBAI BENCHES MUMBAI MUMBAI BENCHES MUMBAI MUMBAI BENCHES MUMBAI BEFORE SHRI R K PANDA A BEFORE SHRI R K PANDA A BEFORE SHRI R K PANDA A BEFORE SHRI R K PANDA ACCOUNTANT MEMBER CCOUNTANT MEMBER CCOUNTANT MEMBER CCOUNTANT MEMBER ITA NO. ITA NO. ITA NO. ITA NO.8666/MUM/2010 8666/MUM/2010 8666/MUM/2010 8666/MUM/2010 (ASST YEAR (ASST YEAR (ASST YEAR (ASST YEAR 2005 2005 2005 2005- -- -06 0606 06) )) ) SHRI NEVILLE RUSTOM JOSHI 501 MAKER MANSION 623 LADY JEHANGIR ROAD PARSI COLONY DADAR (W) MUMBAI 14 VS TH DY COMMR OF INCOME TAX CEN.CIR 39 MUMBAI ( (( (APPELLANT APPELLANT APPELLANT APPELLANT) )) ) (RESPONDENT) (RESPONDENT) (RESPONDENT) (RESPONDENT) PAN NO. PAN NO. PAN NO. PAN NO.AFKPJ2061B AFKPJ2061B AFKPJ2061B AFKPJ2061B ASSESSEE BY SMT INDRA G ANAND REVENUE BY SHRI SATBIR SINGH PER R K PANDA AM PER R K PANDA AM PER R K PANDA AM PER R K PANDA AM THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAI NST THE ORDER DATED 22.1.2010 OF THE CIT(A)-41 MUMBAI RELATING TO ASSE SSMENT YEAR 2005-06. 2 THE ASSESSEE IN ITS GROUNDS OF APPEAL HAS CHALL ENGED THE ORDER OF THE CIT(A) IN CONFIRMING THE ACTION OF THE ASSESSING OF FICER IN TREATING THE CASH DEPOSIT OF RS. 96 200/- IN THE BANK ACCOUNT OF THE ASSESSEE AS UNDISCLOSED INCOME OF THE ASSESSEE. 2.1 FACTS OF THE CASE IN BRIEF ARE THAT THE ASSES SEE IS SON OF THE CHAIRMAN & MANAGING DIRECTOR OF M/S VVF LTD. A SEARCH AND SEI ZURE OPERATION WAS CONDUCTED IN THE CASE OF VVF LTD AND ITS DIRECTORS ON 3.1.2008. DURING THE COURSE OF SEARCH AND SEIZURE OPERATION JEWELLERY VA LUED AT RS. 9 370/- WAS FOUND FROM THE POSSESSION OF THE ASSESSEE SHRI NEVILLE R JOSHI. HOWEVER NO CASH WAS 2 ITA NO.8666/MUM/2010 FOUND. IN RESPONSE TO NOTICE U/S 153A THE ASSESSE E FILED RETURN OF INCOME DECLARING AN INCOME OF RS. 87 216/-. IN THE SAID RE TURN THE ASSESSEE DECLARED SALARY INCOME FROM M/S VVF LTD AND INCOME FROM OTHE R SOURCES BEING INTEREST INCOME. IT WAS STATED THAT THE ASSESSEE HAS COMPLE TED HIS EDUCATION UPTO THE LEVEL OF ICSE I.E. EQUIVALENT TO 12 TH STANDARD. 2.2 DURING THE COURSE OF ASSESSMENT PROCEEDINGS TH E ASSESSING OFFICER NOTICED FROM THE STATEMENT OF THE ASSESSEE THAT CAS H OF RS. 96 200/- WAS DEPOSITED IN BANK ACCOUNT OF THE ASSESSEE ON 28.5.2 004. ON BEING QUESTIONED BY THE ASSESSING OFFICER TO EXPLAIN THE SOURCE OF T HE CASH SO DEPOSITED THE ASSESSEE VIDE HIS LETTER DATED 20.7.209 STATED AS U NDER: ASSESSEE USE TO GET SALARY ONLY IN CASH UPTO PERIO D ENDED 30 TH APRIL 2003. ASSESSEE HAD DRAWN EXACT AMOUNT OF SALARY IMM EDIATELY ON RECEIPT OF THE SAME IN CHEQUE FOR SUBSEQUENT PERIOD AND WAS MAINTAINING CASH ON HAND. HIS HOUSEHOLD EXPENSES WERE MET MAINLY BY HI S FATHER. HIS FATHERS WITHDRAWALS PER YEAR WERE IN RANGE OF RS.6 00 000/- OF CASH OVER AND ABOVE CHEQUE PAYMENTS. THIS DEPOSIT WAS THE ONLY CA SH DEPOSITED OVER A PERIOD OF LAST 8 YEARS. THE DATA ARE AS UNDER: CASH SALARY FOR PERIOD 6 TH NOV 2000 TO 30 TH APRIL 2003 RS. 55 584/- CASH DAWN OF SALARY CHEQUE FOR PERIOD 1.7.2003 TO 30.4.2004 RS. 88 820/- TOTAL CASH AVAILABLE ON HAND RS. 1 44 404/- CASH DEPOSITED ON 28 TH MAY 2004 OUT OF THE ABOVE RS. 96 200 /- 2.3 HOWEVER THE ASSESSING OFFICER WAS NOT SATISFIE D WITH THE EXPLANATION GIVEN BY THE ASSESSEE. HE DIS-BELIEVED THE THEORY OF KEEPING SUCH HUGE CASH WITHOUT DEPOSITING THE SAME IN THE BANK WHEN IN THE MODERN SOCIETY WHEN BANKING FACILITIES ARE AVAILABLE AT THE DOOR STEPS. HE ACCORDINGLY TREATED THE AMOUNT OF RS. 96 200/- AS UNDISCLOSED INCOME OF THE ASSESSEE U/S 68 OF THE I T ACT.. 3 ITA NO.8666/MUM/2010 3 IN APPEAL BEFORE THE CIT(A) THE ASSESSEE REITERA TED THE SAME SUBMISSIONS AS MADE BEFORE THE ASSESSING OFFICER. HOWEVER THE CIT(A) WAS ALSO NOT CONVINCED WITH THE EXPLANATION GIVEN BY THE ASSESSE E. HE NOTED THAT NO DOCUMENTARY EVIDENCES WERE SUBMITTED BEFORE THE ASS ESSING OFFICER TO PROVE THE SOURCE OF THE CASH. THE ASSESSEE HAS NOT DISCH ARGED HIS ONUS BY PROVING THE SOURCE OF SUCH DEPOSIT IN THE BANK EITHER BEFORE T HE ASSESSING OFFICER OR BEFORE HIM. REFERRING TO THE DECISION OF THE TRIBUNAL IN THE CASE OF PRADEEP KUMAR LOYAKA VS ITO REPORTED IN 63 ITD 87 AND ACIT VS DHA NLAXMI STEEL REPORTED IN 57 ITD 371 HE UPHELD THE ACTION OF THE ASSESSING OFFI CER. AGGRIEVED WITH SUCH ORDER OF THE CIT(A) THE ASSESSEE IS IN APPEAL BEFORE TH E TRIBUNAL. 4 THE LD COUNSEL FOR THE ASSESSEE REITERATED THE SA ME SUBMISSIONS AS MADE BEFORE THE ASSESSING OFFICER AND CIT(A). SHE SUBMIT TED THAT THE ASSESSEE WAS IN RECEIPT OF CASH SALARY FROM THE COMPANY WHICH WAS K EPT WITH HIM. REFERRING TO THE SUBMISSIONS MADE BEFORE THE ASSESSING OFFICER SHE SUBMITTED THAT OUT OF THE CASH SALARY RECEIVED BY THE ASSESSEE FROM 6.11.2000 TO 30.4.2003 AMOUNTING TO RS.55 584/- AND THE CASH DRAWAL OF SALARY CHEQUE FO R THE PERIOD FROM 1.7.2003 TO 30.4.2004 AMOUNTING TO RS. 88 820/- (BOTH TOTALLING TO RS. 1 44 404/-) THE ASSESSEE MADE CASH DEPOSIT OF RS. 96 200/- AND THE BALANCE AMOUNT WAS SPENT FOR HIS PERSONAL EXPENDITURE. REFERRING TO THE DEC ISION RELIED ON BY THE LD CIT(A) SHE SUBMITTED THAT THOSE DECISIONS ARE NOT APPLICAB LE TO THE FACTS OF THE PRESENT CASE. IN THOSE CASES NO DOCUMENTARY EVIDENCES WERE GIVEN WHEREAS IN THE INSTANT CASE THE ASSESSEE HAS EXPLAINED THE SOURCE OF CASH DEPOSITS BEING THE ACCUMULATED SALARY RECEIVED BY HIM IN THE PAST. 4 ITA NO.8666/MUM/2010 4.1 THE LD DR ON THE OTHER HAND WHILE SUPPORTING THE ORDERS OF THE AUTHORITIES BELOW RELIED ON THE DECISIONS OF THE HO NBLE SUPREME COURT IN THE CASE OF CIT VS DURGA PRASAD MORE REPORTED IN 82 ITR 54 AND IN THE CASE OF SUMATHI DAYAL VS CIT REPORTED IN 214 ITR 801. 5 I HAVE CONSIDERED THE SUBMISSIONS MADE BY BOTH TH E PARTIES PERUSED THE ORDERS OF THE AUTHORITIES BELOW AND THE PAPER BOOK FILED ON BEHALF OF THE ASSESSEE. I HAVE ALSO CONSIDERED THE DECISIONS CIT ED BEFORE ME. THERE IS NO DISPUTE TO THE FACT THAT AN AMOUNT OF RS. 96 200/- HAS BEEN DEPOSITED IN THE BANK ACCOUNT OF THE ASSESSEE ON 28.5.2004. THERE IS ALSO NO DISPUTE TO THE FACT THAT THE ASSESSEE DURING THE ASSESSMENT PROCEEDINGS HAS SUBMITTED THAT THE ABOVE AMOUNT WAS DEPOSITED OUT OF THE SALARY RECEIV ED BY HIM FOR THE PERIOD FROM 6.11.2000 TO 30.4.2004. I FIND THE ASSESSING OFFICER DISBELIEVED THE SUBMISSIONS OF THE ASSESSEE ON THE GROUND THAT KEEP ING OF SUCH HUGE CASH WITH HIM INSTEAD OF DEPOSITING THE SAME IN THE BANK ACCO UNT WHERE BANKING FACILITIES ARE AVAILABLE AT THE DOOR STEPS IS AGAINST HUMAN PR OBABILITY. I FIND THE CIT(A) UPHELD THE ACTION OF THE ASSESSING OFFICER ON THE G ROUND THAT THE ASSESSEE HAS NOT DISCHARGED THE ONUS CAST ON HIM BY SUBMITTING A NY DOCUMENTARY EVIDENCE TO PROVE THE SOURCE OF THE DEPOSIT. IN MY OPINION TH E OBSERVATION OF THE CIT(A) IS FACTUALLY INCORRECT. THE ASSESSEE HAS SUBMITTED BE FORE THE ASSESSING OFFICER THAT THE AMOUNT DEPOSITED IN THE BANK ACCOUNT IS OUT OF THE SAVING FROM THE SALARY RECEIVED BY HIM. THIS SUBMISSION OF THE ASSESSEE RE GARDING RECEIPT OF SALARY FROM THE COMPANY HAS NOT BEEN PROVED TO BE FALSE O R UNTRUE ESPECIALLY WHEN THE ASSESSMENT ORDER HAS BEEN PASSED U/S 143(3) R.W .S 153A OF THE I T ACT AND THE ASSESSING OFFICER WAS SUPPOSED TO GO THROUGH TH E RECORDS OF THE GROUP COMPANY OF VVF LTD WHICH WAS ALSO SEARCHED ON THE SAME DATE. THE VARIOUS 5 ITA NO.8666/MUM/2010 DECISIONS RELIED UPON BY THE CIT(A) IN MY OPINION ARE NOT APPLICABLE TO THE FACTS OF THE INSTANT CASE. 6 AS REGARDS THE OBSERVATIONS OF THE ASSESSING OFFI CER THAT THE ASSESSEE SHOULD HAVE KEPT THE HUGE AMOUNT OF CASH IN THE BAN K ACCOUNT INSTEAD OF KEEPING THE SAME WITH HIMSELF IN MY OPINION THE SA ME MAY BE DESIRABLE BUT IS NOT MANDATORY OR COMPULSORY FOR DEPOSITING IN THE B ANK ACCOUNT. CONSIDERING THE TOTALITY OF THE FACTS OF THE CASE AND CONSIDERI NG THE SMALLNESS OF THE AMOUNT I FIND FORCE IN THE SUBMISSION OF THE LD COUNSEL FO R THE ASSESSEE THAT THE AMOUNT OF RS. 96 200/- DEPOSITED IN THE BANK ACCOUNT IS O UT OF SAVINGS FROM SALARY RECEIVED BY THE ASSESSEE FOR THE PERIOD FROM NOV 20 00 TO APRIL 2004. IN THIS VIEW OF THE MATTER I SET ASIDE THE ORDER OF THE CIT(A) AND DIRECT THE ASSESSING OFFICER TO DELETE THE ADDITION. THE GROUND RAISED BY THE AS SESSEE IS ACCORDINGLY ALLOWED. 7 IN THE RESULT THE APPEAL FILED BY THE ASSESSEE I S ALLOWED. ORDER PRONOUNCED ON THE 25 TH DAY OF FEB 2011. SD/- ( R K PANDA ) ( R K PANDA ) ( R K PANDA ) ( R K PANDA ) ACCOUNTANT MEMBER PLACE: MUMBAI : DATED:25 TH FEB 2011 RAJ* 6 ITA NO.8666/MUM/2010 COPY FORWARDED TO: 1 APPELLANT 2 RESPONDENT 3 CIT 4 CIT(A) 5 DR /TRUE COPY/ BY ORDER DY /AR ITAT MUMBAI