Income Tax Appellate Tribunal - Lucknow
Ashish Kumar Shah, Kanpur vs Assessee
IN THE INCOME TAX APPELLATE TRIBUNAL
LUCKNOW BENCH "B", LUCKNOW
BEFORE SHRI SUNIL KUMAR YADAV, JUDICIAL MEMBER AND
SHRI J SUDHAKAR REDDY, ACCOUNTANT MEMBER
ITA Nos.262 & 264/LKW/2010
Assessment Years:2004-05 and 2006-07
Dr. Ashish Kumar Shah, v. ACIT
240-A, 1, Hardender Nagar CC-V, Kanpur
Kanpur
PAN:AGXPS1757P
(Appellant) (Respondent)
ITA Nos.263/LKW/2012
Assessment Year:2005-06
Dr. Ashish Kumar Shah, v. ACIT
240-A, 1, Hardender Nagar CC-V, Kanpur
Kanpur
PAN:AGXPS1757P
(Appellant) (Respondent)
Appellant by: Shri. Rakesh Garg, Advocate
Respondent by: Shri. Jagdish, CIT (DR)
Date of hearing: 14.03.13
Date of pronouncement: 28/08/2013
ORDER
PER SUNIL KUMAR YADAV:
These appeals are preferred by the assessee against the respective order of the ld. CIT(A) pertaining to assessment years 2004-05, :-2-:
2005-06 and 2006-07. Since these appeals were heard together, these are being disposed of through this consolidated order. We, however, prefer to adjudicate them one after the other.ITA No. 262/LKW/2010 : Assessment year 2004-05:
2. In this appeal, the assessee has assailed the order of the ld. CIT(A), inter alia, on various grounds, which are as under:-
1. Because the CIT(Appeals) has erred on facts and in law in confirming the addition of Rs.15,000/-, the amount deposited by the assessee appellant on 29.3.2004 in his Savings Bank account with ICICI Bank, Kanpur, treating the same to be unexplained.
2. Because the authorities below have failed to appreciate the explanation furnished by the assessee, and has arbitrarily held, that a sum of Rs.15,000/- deposited in ICICI Bank is unexplained.
3. Because the CIT(Appeals) has failed to appreciate the facts and circumstances of the case and the explanation furnished by the assessee, and has arbitrarily treated Rs.37,000/- received by the assessee as loan from Shri Ram Naresh Yadav (Rs.18,000/-) and Shri Mahesh Shukla (Rs.19,000/-) as unexplained.
4. Because the assessee having filed confirmation, giving complete names and addresses of the parties, and an explanation stating that the loans were received from the respective loanees, the primary onus cast on the appellant having been discharged, the CIT(A) has erred on facts and in law in holding the aforesaid loans as unexplained and has arbitrarily upheld the addition of Rs.37,000/-.
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5. Because on a proper consideration of facts and circumstances of the case, it would be found that the loans having been received in the normal course and duly confirmed, the CIT(Appeals) was not justified in rejecting the assessee's explanation and holding the same to be unexplained.
3. Apropos grounds No.1 and 2, it is noticed that the assessee has made deposit of `15,000 in ICICI Bank on 29.3.2004, but could not explain the source of deposit before the Assessing Officer and the Assessing Officer made addition thereof. Before the ld. CIT(A), the assessee did not press the ground with regard to this issue and the ld. CIT(A) confirmed the addition made by the Assessing Officer.
4. Now the assessee has raised this ground again before the Tribunal but has not furnished the source of deposit. The assessee has also not brought out anything on record to state that he has pressed this ground before the ld. CIT(A). The ld. CIT(A) has categorically recorded in his order that this ground is not pressed by the ld. counsel for the assessee. Therefore, he has confirmed the addition. If the assessee contend otherwise before the Tribunal, onus is upon him to prove that he has pressed this ground before the ld. CIT(A). Presumption under Indian Evidence Act is that the contents of the order sheet in judicial proceedings recorded by the Presiding Officers are deemed to be correct and true unless and otherwise is proved by some documentary evidence. Since nothing has been brought on record to establish the facts contrary to the facts recorded in the order sheet, we are of the view that since this ground was not pressed before the ld. CIT(A), the ld. CIT(A) has rightly dismissed the same.
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5. The next grounds i.e. grounds No.3 and 4 relate to the addition of `37,000 on account of unexplained cash credit received from Shri. Ram Naresh Yadav and Shri. Mahesh Shukla. Before the Assessing Officer, the assessee filed confirmation of receipt of `18,000 from Shri. Ram Naresh Yadav and `19,000 from Shri. Mahesh Shukla, but the confirmations were not accepted by the Assessing Officer as it was on plain paper. Similar was the position with the ld. CIT(A).
6. Now the ld. counsel for the assessee has contended that during the course of assessment proceedings and appellate proceedings before the ld. CIT(A), the assessee was not asked to produce the creditors or to file a proper confirmation along with source of advancement and the creditworthiness. However, the ld. counsel for the assessee before us undertook to file all these evidences if an opportunity is given to him.
7. The ld. D.R., on the other hand, has strongly opposed the contention of the ld. counsel for the assessee with the submission that it is the onus upon the assessee to prove the genuineness of cash credit, identity and creditworthiness of the creditors. If the assessee fails to prove these ingredients, the Revenue authorities are justified in making the addition under section 68 of Income-tax Act, 1961 (hereinafter called in short "the Act").
8. Having given a thoughtful consideration to the rival submissions and perusal of record, we find that the assessee has filed confirmation of Shri. Ram Naresh Yadav and Shri. Mahesh Shukla. Copies of the same are placed at pages 3 and 4 of the compilation of the assessee. In those confirmations, neither complete address of the creditors nor any information with regard to the creditworthiness were given. Now since the assessee has undertaken to produce these creditors before the A.O. for :-5-:
verification and to prove the creditworthiness, we are of the view that one more opportunity should be afforded to the assessee. Accordingly we set aside the order of the ld. CIT(A) in this regard and restore the matter to the file of the Assessing Officer with a direction to re-adjudicate the issue afresh after affording an opportunity of being heard to the assessee. If need be the Assessing Officer may examine the creditors, for which the assessee will extend all sort of co-operation.ITA Nos. 264/LKW/2010 : A.Y 2006-07 & ITA Nos.263/LKW/2012:A.Y. 2005-06:
9. Through these appeals, the assessee has assailed the orders of the ld. CIT(A) confirming the addition of `7.50 lakhs in each assessment year on the basis of the statement recorded during the course of search. Besides, one more ground relating to charging of interest under sections 234A and 234B of the Act is also raised. Since this ground is consequential in nature, it does not require any specific adjudication. Therefore, we are left with only one ground with regard to the addition of `7.50 lakhs each in both the assessment years.
10. During the pendency of appeal, the assessee has also moved an application for admission of additional ground that no search warrant was issued in the name of the assessee, therefore, assessment framed under section 153A of the Act is without jurisdiction. During the course of hearing of the appeal, the ld. counsel for the assessee has opted not to press the additional ground. Accordingly the application for admission of additional ground filed by the assessee is dismissed being not pressed.
11. With regard to the grounds on merit i.e. addition of `7.50 lakhs each, it is noticed from the orders of the lower authorities that during the course of assessment proceedings the assessee has voluntarily surrendered a total sum of `70 lakhs in the hands of different persons. In his individual :-6-:
hands he has surrendered `15 lakhs in both the assessment years i.e. assessment years 2005-06 and 2006-07 but while filing the return of income he did not offer this amount. Relying upon the surrender statement recorded during the course of search, the Assessing Officer made an addition of `7.50 lakhs each in assessment years 2005-06 and 2006-07, against which appeals were filed before the ld. CIT(A) with the submission that the assessee has made surrender statement during the course of search without realizing the correct position. During the course of assessment proceedings, the assessee has clarified the position as to under what circumstances surrender was made. The assessee has clarified that during the course of search he was not assisted by a legal advisor and on that date the Chartered Accountant or Accountant of the assessee were not allowed to enter the premises. Since the statement recorded under the disturbed mental state, the income offered in individual hands were not disclosed in the return of income as it was wrongly surrendered. It was also stated before the ld. CIT(A) that once surrender statement was retracted, it is for the Assessing Officer to make necessary enquiry/verification on the point on which surrender was made, before making the addition, but he did not do so and made addition relying upon the surrender statement. Being not convinced with the explanations of the assessee, the ld. CIT(A) confirmed the addition of `7.50 lakh each in both the assessment years.
12. Now the assessee has preferred appeals before the Tribunal with the submission that the Assessing Officer has not made any enquiry with regard to the issues on which surrender was made. In support of his contention that whenever surrender statement was made without any basis and it was retracted, the Assessing Officer is required to make necessary enquiry to form the basis of addition, he has relied upon the order of the :-7-:
Tribunal in the case of ACIT vs. Anoop Kumar [2005] 94 TTJ 288; ACIT vs. Jorawar Singh M. Rathod, [2005] 94 TTJ 867, in which it has been held that addition merely on the basis of statement recorded under section 132(4) of the Act at the time search are not sustainable as no evidence/ material/ assets immoveable or moveable were found at the time of search which support the disclosure.
13. The ld. D.R., on the other hand, has placed reliance upon the order of the ld. CIT(A).
14. Having carefully examined the orders of the lower authorities in the light of the rival submissions, we find that during the course of search the assessee has made surrender statement offering a total sum of `70 lakhs in different hands. Though he has made surrender in the hands of individuals, but no reason for surrendering the amount of `15 lakhs in the hands of individual available in the orders of the lower authorities. Meaning thereby, no material or evidence was found on the basis of which the assessee has made surrender of `15 lakhs in the hands of individual in both these years. Once surrender statement was retracted by the assessee by not offering it in the return of income, the Assessing Officer would be at liberty to make necessary enquiry and also to find out material on the basis of which surrender of `15 lakhs was made by the assessee for both the years. But no effort was made by the Assessing Officer and having simply relied upon the surrender statement during the course of search, made an addition of `7.50 lakhs each in both the assessment years. Similar aspect was examined by the various Benches of the Tribunal in the aforementioned cases and it has been categorically held that once surrender was made without any material and evidence and is retracted subsequently, the onus is upon the Assessing Officer to bring out some cogent material on record before making addition. Since the Assessing :-8-:
Officer has not made any effort to collect cogent material to make addition, we find no merit therein. We accordingly set aside the order of the ld. CIT(A).
15. In the result, appeal in ITA No. 262/LKW/2010 is partly allowed and appeals in ITA Nos. 263/LKW/2012 and 264/LKW/2010 are allowed.
Order pronounced in the open court on 28/05/2013 Sd/. Sd/.
[J SUDHAKAR REDDY] [SUNIL KUMAR YADAV]
ACCOUNTANT MEMBER JUDICIAL MEMBER
DATED:28/05/2013
JJ:1204
Copy forwarded to:
1. Appellant
2. Respondent
3. CIT(A)
4. CIT
5. DR
Assistant Registrar