Narender Kumar Anand, New Delhi vs Department Of Income Tax

BEFORE SHRI G. C. GUPTA, HON'BLE VICE PRESIDENT AND SHRI T.S. KAPOOR, ACCOUNTANT MEMBER I.T.A. No. 5670/Del/2012 Assessment year : 2007-08 ITO, Ward 21(3), Vs. Sh. Narender Kumar Anand, New Delhi H.No.4, Vilalge Sanoth, Narela, Delhi-110 040 GIR / PAN:AGAPA0077B (Appellant) (Respondent)

Appellant by : Shri P. Dam Kanunjha, Sr. DR Respondent by : Shri R. S. Ahuja, CA

Date of hearing : 11.03.2015 Date of pronouncement : 25.03.2015

ORDER

PER T.S. KAPOOR, AM:

This is Revenue's appeal against the order of Ld. CIT(A) dated 24.08.2012. The only effective ground raised by Revenue is against action of Ld. CIT(A) by which he has deleted addition of Rs.12.48 lacs which was made by the A.O. on account of unexplained cash found deposited in the bank account of the assessee.

2. The brief facts of the case are that during assessment proceedings, the A.O. observed that the assessee had deposited an amount of Rs.15.28 lacs in his bank account with Corporation Bank, Narela, Delhi and on being asked, the assessee submitted that part of cash was lying as opening balance amounting to Rs.8,79,180/- and further he had claimed to have sold certain 2 ITA No.5670/Del/2012

land form which an amount of Rs.2.80 lacs was received. The A.O. did not accept the contention of the assessee that opening balance was kept as cash in hand. However he accepted the contention regarding the sale of land and after considering the sale of land, made a net addition of Rs.12.48 lacs.

3. Aggrieved by the order, assessee filed appeal before Ld. CIT(A) and submitted various contentions including admission of additional evidence as per Rule 46A of the Act and the additional evidence was in the form of bank statement of Bank of India. Before Ld. CIT(A), the assessee claimed that above evidence could not be filed with the A.O. as the then counsel had omitted to file the same before the A.O. and therefore, the then counsel had also filed affidavit in this respect. Ld. CIT(A) after obtaining remand report form A.O., accepted the additional evidence and A.O. however objected to the admission of additional evidence and did not comment upon merits. However, Ld. CIT(A) accepted the additional evidence as in his opinion these were consequential documents for arriving at appropriate decision in the case. The assessee also filed a detailed cash flow statement starting form 01.04.2004 wherein deposits and withdrawals from such bank account was taken into consideration. Ld. CIT(A) accepted the contention of assessee and deleted the addition. Aggrieved, the Revenue is in appeal before us.

4. At the outset, Ld. D.R. submitted that cash flow statement prepared and submitted before Ld. CIT(A) cannot be relied upon in view of the fact that major cash in hand claimed was on account of a gift received from father of assessee which was received in December 2004 and, therefore, should not have been considered for the purpose of considering as opening cash balance with the assessee. Moreover, it was submitted that keeping such large cash balance in hand is also against human probabilities.

3 ITA No.5670/Del/2012 5. Ld. A.R. on the other hand invited our attention to various copies of bank account statements placed at paper book pages 41-46. Ld. A.R. also invited our attention to paper book pages 47-61 where a copy of cash flow statement and affidavit from father of assessee regarding confirmation of gift of Rs.20 lacs and also documents regarding gift from Father-in-law was placed. Ld. A.R. submitted that Ld. CIT(A) after verifying the facts and circumstances and figures had arrived at the conclusion that sufficient balance was there before depositing cash in the bank and therefore, has rightly deleted the addition. Without prejudice to the above, Ld. A.R. further submitted that since assessee was not maintaining books of accounts therefore, addition u/s 68 was not warranted as passbook cannot be construed to the books of accounts of the assessee.

6. We have heard rival parties and have gone through the material placed on record. We find that assessee before Ld. CIT(A) had field details of cash deposits and details from 01.04.2004 onwards during which period the assessee had received an amount of Rs.20 lacs as gift from his father. The father of assessee had made gift out of money received from Government on acquisition of land. The affidavit of father along with documents evidencing acquisition of land are placed in paper book pages 58-61 and the said amount of Rs.20 lacs was deposited in Bank of India account which is apparent from paper book page 41. The assessee had been withdrawing from this amount and was depositing again in this account and again has withdrawn from this account and the last withdrawal from this account was on the following dates:

25.11.2005 1.25 lacs 29.11.2005 2.40 lacs 19.12.2005 3.20 lacs 4 ITA No.5670/Del/2012

6.1 These facts are verifiable form paper book page 41 and even Ld. CIT(A) at page 10 has also noted all these facts. Besides above, Ld. CIT(A) has noted in his order at page 10 the following withdrawals from Corporation Bank:

20.12.2005 1.50 lacs 02.01.2006 1.00 lacs 17.03.2006 1.03 lacs 15.06.2006 2.00 lacs 11.08.2006 2.00 lacs 6.2 The total of these withdrawals comes out at Rs.14.28 lacs. Therefore, Deposits during the period of May 2006 to Feb 2007 can be rightly related to these withdrawals as A.O. has not found utilization of this amount for any other purpose therefore, in view of above facts and circumstances, addition made by A.O. amounting to Rs.12.48 lacs on account of cash deposits has been rightly deleted by Ld. CIT(A) and we do not find any infirmity in the same.

7. In view of above, appeal filed by Revenue is dismissed.

8. Order pronounced in the open court on 25th March, 2015.

Sd./- Sd./- ( G. C. GUPTA) (T.S. KAPOOR) VICE PRESIDENT ACCOUNTANT MEMBER th Date: 25 March, 2015 Sp Copy forwarded to:- 1. The appellant 2. The respondent 3. The CIT 4. The CIT (A)-, New Delhi.

5. The DR, ITAT, Loknayak Bhawan, Khan Market, New Delhi.

True copy. By Order

(ITAT, New Delhi). 5 ITA No.5670/Del/2012

S.No. Details Date Initials Designation 1 Draft dictated on 16/3 Sr. PS/PS 2 Draft placed before author 17,23 Sr. PS/PS Draft proposed & placed before the 3 JM/AM Second Member Draft discussed/approved by Second 4 AM/AM Member 5 Approved Draft comes to the Sr. PS/PS 25/3 Sr. PS/PS 6 Kept for pronouncement 25/3 Sr. PS/PS 7 File sent to Bench Clerk 25/3 Sr. PS/PS Date on which the file goes to Head 8 Clerk 9 Date on which file goes to A.R. 10 Date of Dispatch of order