Income Tax Appellate Tribunal - Chandigarh
Shri Diwan Chand, Kullu vs Ito, Kullu on 6 September, 2018
IN THE INCOME TAX APPELLATE TRIBUNAL DIVISION BENCH 'A', CHANDIGARH BEFORE MS.DIVA SINGH, JUDICIAL MEMBER AND MS. ANNAPURNA GUPTA, ACCOUNTANT MEMBER ITA No.119/Chd/2017 (Assessment Year : 2011-12) Shri Diwan Chand, Vs. The Income Tax Officer, S/o Shri Hem Singh, Kullu.
V. Batahar P.O. Haripur,
Distt. Kullu (H.P.)
PAN: ASGPC6745A
(Appellant) (Respondent)
Appellant by : Shri R.R. Thakur, Adv.
Respondent by : Shri Ankur Alya, JCIT DR
Date of hearing : 08.08.2018
Date of Pronouncement : 06.09.2018
O RDE R
PER ANNA PURNA GUPTA, A. M. :
Th i s a p p e a l h a s b e e n p r e f er r e d by t h e a s s es s e e ag a i n st t h e o r d e r o f L d. C o m m i s s i o ne r o f I n c o m e Ta x ( A p p e a l s ) , Palampur d at e d 1 0 . 1 0 . 2 0 1 6 re l a t i n g to a s se s sm e n t year 2011-12.
2. The bri ef facts re l ati ng to the case are that the assessee is engaged in the busi ness of tracki ng and adventure gui dance. Duri ng the i mpugned year i t was found that the assessee had deposi ted cash amounti ng to Rs.18,50,000/- i n hi s savi ng bank account. Enqui r y l etter i n thi s regard was i ssued to the assessee, but no compl i ance was made. Accordi ngl y, si nce the source of cash deposi ted remai ned une xpl ai ned, the case of t he ass essee was reope ned under secti on 147 of th e I ncome Ta x Act , 1961 ( i n short 'the Act') . 2 ITA No.119/Chd/2017
A.Y.2011-12 Duri ng assessment proceedi ngs, the assessee was asked to e xpl ai n the sour ce of cash depos i ted, to whi ch th e assessee contented that the same was an account of l oans/ advances, gi ven by hi s fath er to hi s rel ati ve s, whi ch had bee n returned duri ng the year a nd al so out of th e agri cul ture i nc ome of hi s father. The A.O after maki ng due i nqui res found t hat out of the total deposi t of Rs.18,50,000/- i n the Savi ng Bank A/c of the assessee in the State Bank of I ndia, Hari pur, Rs.5,90,000 coul d be attri buted to l oans returned by rel ati ves and Rs.9,20,000/- to the agri cul ture i ncome earned duri ng the year from the sal e of crop. Accordi ngl y he accepted the e xpl anati on of the assessee vi s-à-vi s deposi ts total i ng Rs.15,10,000/-. The bal ance cash deposi t of Rs.3,40,000/- was treated as une xpl ai ned by A.O and addi ti on made on account of sa me to the i nco me of the assessee. The A.O. al so found that there was cash deposi t of Rs.1,50,000/- i n the Savi ng Ba nk A/c mai ntai ned by the assessee wi th State Bank of Patial a, Patl i kuhal which al so remai ned une xpl ai ned. Addi ti on of the same was al so made to the i ncome of the assessee. The A.O. further noted that assessee had returned Agri cul ture i ncome of Rs.1,80,000/- i n hi s return of i ncome but was nei ther the o wner of any agri cul tural l and, nor had demonstrated the same to the A.O. Therefore the agri cul ture i ncome returned by the assessee of Rs. 1,80,000/- was treated as I ncome earned from undi scl osed sources and added to the i ncome of the assessee.
3 ITA No.119/Chd/2017
A.Y.2011-12
4. Aggri eved by the same, the assessee fi l ed appeal before the Ld. CI T( Appeal s) , chal l engi ng al l the above addi ti ons made by the A.O. The Ld.CI T( Appeal s) del eted the addi ti on made on account of cash found deposi ted i n Savi ng Bank A/c of the assessee wi th St ate Bank of I ndi a, Hari pur to the e xtent of Rs.1,50,000/-, on fi ndi ng that the sai d amount had not been accounted for by the A.O. whi l e gi vi ng credi t to the advance returned by the rel ati ves of the assessee's father, as source of cash deposi ted i n the sai d bank A/c of t he assessee. Ac cordi ngl y, the bal ance of Rs.1,90,000/-, remai ni ng une xpl ai ned, was uphe l d by the CI T( Appeal s) . Th e CI T( Appeal s) al so uphel d the additi on made on account of cash deposi t ed i n the Savi ng Bank A/c of the assessee in State Bank of Pati al a, Pat l i kuhal of Rs.1,50,000/- whi ch the assesse e had contended was from agri cul tural i ncome earned from s al e of crop, i n t he absence of any evi dence and detai l of the same. The addi ti o n made by the A.O. treati ng the agri cul tural i ncome returned by the assessee as i ncome from other sources was al so uphel d hol di ng that the evi dence submi tted by the as sessee of o wnershi p of agr i cul ture l and sho wed hi s father a s o wner of the Land and pe rtai ned to the as sessment year 2 003- 04 and that the agri cul ture i ncome sho wn to have been earned had al ready been gi ven credi t of as cash deposi ted i n the Bank A/c of the assessee and i n any case i t was the agricul tural i ncome of the father of the assessee and not the assessee. 4 ITA No.119/Chd/2017
A.Y.2011-12
5. Aggri eved by th e same the asse ssee has come up in appeal before us rai si ng the fol l o wi ng effecti ve grounds:
"2. That the Ld. Commissioner of Income Tax (Appeal) has wrongly confirmed the addition of Rs.1,90,000/- which is likely to be deleted.
3. That the Ld. Commissioner of Income Tax (Appeal) has wrongly confirmed the addition of Rs.1,50,000/- which is likely to be deleted.
4. That the Ld. Commissioner of Income Tax (Appeals) has wrongly confirmed the addition of Rs.1.80,000/- added by the Assessing Officer as income from undisclosed sources. The addition is likely to be deleted."
6. Taki ng up al l t he grounds tog ether before us , Ld. Counsel for the assessee contended that the cash avai l abl e wi th i t duri ng the year amounted to Rs. 19,77,110 as under:
( 1 ) A mo u n t of Lo an R e tu r n e d 7,40,000
ac c e p te d b y C IT ( A ) al s o
( 2 ) Ag r ic u l tu r e C o ntr ac t 9,20,000
A mo u n t
( 3 ) In c o me R e tu r n e d 1,37,110
( 4 ) Ag r ic u l tu r e In c o me 1,80,000
T o tal 1 9 ,7 7 ,1 1 0
7. The assessee co ntended that out of the above amount Rs.1,50,000/- was deposi ted i n Savi ng Bank A/C of Pati al a, Patl i kuhal , l eavi ng the assessee wi th the bal ance of Rs.18,27,110/- whi ch e xpl ai ned the cash found depos i ted of Rs.18,50,000/- i n the Savi ng bank A/c of the assessee in State Bank of Indi a, Hari pur. He therefore contended that the Ld.CI T( Appeal s) , had wrongl y confi rmed the addi ti on of Rs.1,90,000/- and Rs.1,50,000/- on account of cash deposi ted i n the sai d t wo bank accounts of the assessee, whi ch were chal l enged by the wa y of ground Nos.2 & 3 rai sed 5 ITA No.119/Chd/2017 A.Y.2011-12 before us. As for the addi t i on made on account of agri cul tural i ncome uphel d by the CI T( Appeal s) chall enged i n ground No.4 rai sed before us, the Ld. counsel for assessee contended that the agri cul tural l and was transferred to him on the death of hi s father on 18.12.2010 whi ch was evi denced by Fa rd of agri cul tur al Land taken from the Pat wari on 18/0 1/12 and on 19. 09.2016. I t was contended that the Ld.CI T( A) had wrongl y menti oned the Fard as pertai ni ng to A.Y 2003-04, whi ch was actual l y I ntekhab Mi scl e Haki at Ba waat Saal and not A.Y. I t was therefore contended that the o wnershi p of l and havi ng been dul y establ i shed there remai ned no r eason for not ac cepti ng the agri cul tural i ncome returned by the as sessee of Rs.1,80,000/-.
8. Ld. DR, on the other hand, rel i e d on the order o f the CI T( Appeal s) and stated that the assessee had al ready been gi ven due benefi t of l oan sho wn to have been returned by rel ati ves duri ng the year amounti ng to Rs.7,40,000/- and al so i ncome earned from sal e of crop l and of Rs.9,20,000/- and i n the absence of any other evi dence for the remai ni ng cash deposi ted, the CI T( Appeal s) had ri ghtl y uphel d the bal ance addi ti ons made. As for agri cul tural i ncome cl ai med to have been earned by the assessee, Ld. DR rel i ed on the order of the CI T( Appeal s) and stated that the documents fi l ed by the assessee, sho wed that the agri cul tural l and was o wned by the father and therefore the agri cul tural i ncome earned thereon coul d not attri buted to the assessee and the 6 ITA No.119/Chd/2017 A.Y.2011-12 CI T( Appeal s) therefore had ri ghtl y treated the agricul tural i ncome earned by the assessee as I ncome from other sources.
9. We have heard the ri val contenti ons and perused the orders of the authori ti es bel o w. The undi sp uted facts rel ati ng to the c ase are that cas h found deposi t ed i n t wo savi ngs bank account of the assessee amounted al l in Rs.20,00,000/- as under:
• SBI , Hari pur Rs. 18,50,000/-
• SBOP, Patl i kuhal Rs. 1,50,000/-
10. The e xpl anati ons furni shed by the assessee regardi ng the source of th e same to the a uthori ti es bel o w and even before us, whi ch we fi nd, stands accepted by authori ti es bel o w i s as under:
• Advances returned by rel ati ves Rs. 7,40,000 • I ncome from sal e of crops Rs. 9,20,000 Total Rs.16,60,000/-
11. Regardi ng the ab ove facts there i s no di spute. Ther efore the bal ance remai ni ng une xpl ai ned i s Rs.1,90,000/- , i n SBI, Hari pur ( 18,50,000-16,60,000) and Rs.1,50,000/- i n SBOP, Patl i kuhal , total i ng i n al l to Rs.3,40,000/-. Before us the assessee has attri buted the source of thi s cash to i ts i ncome returned of Rs.1,37,110/- and agri cul tural income of Rs.1,80,000/-.
12. As for pl ea of the of the assessee for the credi t to be gi ven for hi s i nco me returned of R s.1,37,110/-, we fi nd meri t in the same. It is not di sputed that the assessee has 7 ITA No.119/Chd/2017 A.Y.2011-12 returned the sai d i ncome to ta x. The Ld.DR has n ot rebutted the aforesai d contenti on of the assessee that credit be gi ven of the i ncome returned by i t for the cash found deposi ted. We therefore see no reason for n ot gi vi ng any cr edit of the same for the c ash found depo si ted in the ba nk of the assessee.
13. As regards the c l ai m of the asse ssee of attri buti ng the cash deposi ted, to agri cul tural i ncome of Rs.1,80,000/- returned for ta x, we see no reason for denyi ng the same al so. The Revenue we fi nd has treated the sai d i ncome as i ncome from undi scl osed sources, re jecti ng the assessees contenti on that i t was hi s agri cul tural i ncome. But the sai d fact , we hol d, makes no d i fference so far a s source of cash deposi t i n bank is concerned. Havi ng accepted the fact that the assessee had earned i ncome of Rs.1,80,000/-, al bei t from undi scl osed sour ces, the same c an be safel y att ri buted as the source of cash deposi ted i n the bank of the assessee.
14. I n vi e w of the above, therefore, we di rect that credi t for the cash deposi ted i n the bank be gi ven for t he i ncome returned by the assessee of Rs.1, 37,110/- & the a gri cul tural i ncome of Rs.1, 80,000/- returne d by the assesse e. Ground of appeal Nos.2 & 3 rai sed by the assessee therefore stand partl y al l o wed to the above e xtent.
15. As for the i ssue rel ati ng to tre ati ng the agri cu l tural i ncome returned by the assessee as i ncome from u ndiscl osed sources, the onl y the contenti on of the Ld.Coun sel for the assessee i s that si nce i t had es tabl i shed the o w nershi p of 8 ITA No.119/Chd/2017 A.Y.2011-12 l and, the agri c ul tural i ncome earned therefro m was hi s i ncome. We fi nd that the CI T( A) has gi ven a categori cal fi ndi ng that the sai d i ncome cannot be treated as hi s agri cul tural i ncome si nce the ownershi p of l and by the assessee was not establ i shed and al so because i n any case agri cul tural i ncome therefrom from sal e of frui t crops of Rs.9,20,000/- h ad al ready been cl ai med as the i ncome of the father, whi ch was cl ai med by the assessee as a source of cash found dep osi ted i n the b ank of the ass essee. The rel evant fi ndi ngs of the CI T( A) at page 5 of her o rder i s as under:
"The submissions of the appellant and facts of the case on record have been considered. It is observed that the land record submitted by the appellant pertain to A.Y.2003-04 where the owner of the land is shown as Hem Raj, father of the appellant. The assessee while explaining the source of Rs.18,50,000/- in the saving bank account has stated that all the transaction in the account were 'made on account of agriculture income of his father which includedRs.9,20,000/- as agriculture receipt for the crop of 2010. Therefore agriculture income of Rs.9,20,000/- pertains to his father which has been accepted by the AO. In the absence of documentary evidence that the appellant was the owner of land, the addition of Rs.1,80,000/- on account of undisclosed income is upheld."
16. The Ld.Counsel f or the assessee has not addresse d the i ssue of i ncom e from the sai d l and havi ng al ready been cl ai med by the assessee and accepted by the Revenue, as bel ongi ng to the father of the assessee. Nothi ng has been brought before us to sho w that the agri cul tural i ncome returned by the assessee of Rs.1,80,000/- was over and above the i ncome of Rs.9,20,000/- attri buted to the same pi ece of l and i n the hands of the father of the assessee. In the absence of the same we see no reason for accepti ng the 9 ITA No.119/Chd/2017 A.Y.2011-12 contenti on of the assessee that i t had earned agri cul tural i ncome to the e xtent of Rs.1,80,000/- duri ng the year.
Ground of app eal No.4 rai sed by the assess ee is therefore di smi ssed.
17. I n the resul t, the appeal of th e assessee i s p artl y al l o wed.
O r d e r p r on o u n c ed i n t h e O p e n Cou r t .
Sd/- Sd/-
(DIVA SINGH) (ANNAPURNA GUPTA)
JUDICIAL MEMBER ACCOUNTANT MEMBER
Dated : 6 t h September, 2018
*Rati*
Copy to:
1. The Appellant
2. The Respondent
3. The CIT(A)
4. The CIT
5. The DR
Assistant Registrar,
ITAT, Chandigarh