Cwp/1270/2014 Of Veena v. Commisioner Of Income Tax-1 Jalandhar

IN THE HIGH COURT OF PUNJAB AND HARYANA ATCHANDIGARH CWP No.1270 of 2014Date of decision: 24.01.2014 Miss Veena ...... Petit Vs, Commissioner of Income Tax I, Jalandhar ..... Respond CORAM: HON’?BLE MR. JUSTICEK AJAY KUMAR MITTHON BLE MS. JUSTICEK ANITA CHAUDHRY Present:Mr. Ravish Sood, Advocate for the petitioner.Ajay Kumar Mittal,J, 1.)Challenge in this petition filed under Articles 226/227 of theConstitution of India is for quashing the assessment order dated 5.12.2011,Annexure P.3 and order passed by the respondent - Commissioner ofIncome Tax-l, Jalandhar (CIT) dated 28.3.2013, Annexure P.6 in revisionunder section 264 of the Income Tax Act, 1961 (in short, “the Act’). |A few facts relevant for the decision of the controversyinvolved as narrated in the petition may be noticed. The petitioner, anindividual was engaged in a small business of running a boutique andthereafter, she was employed as a clerk with HDFC Bank - The Mall Road,Kapurthala Branch. She filed her income tax return for the assessment year2009-10 on 29.10.2009 declaring net taxable income ofL1,32,000/- whichwas processed as such under section 143(1) of the Act. On 3.6.2008, sheopened a Saving Bank account in the said bank and the transactions started CWP No.12/0 of 2014 w.e.f 6.9.2008. Shri Amit Kashyap was serving as Manager in the saidbank. He was under pressure to meet out the targets of sale of pure goldcoins given to his branch. During the aforesaid period, a NRI customer ofthe said branch Shri Tarlochan Singh who was maintaining a NRE accountwith this bank, on his visit to India withdrew an amount ofL25 lacs in themonth of September 2008 for purchase of some property which could notmaterialise. Tarlochan Singh could not redeposit the said amount in his NREaccount as deposit of Indian rupees in the said account, was not permitted.He after being persuaded by the manager Shri Amit Kashyap agreed toinvest for the purchase of pure gold coins from the bank. As the purchase ofpure gold coins was not permitted in cash, the manager persuaded thepetitioner to permit routing the said purchase transaction through her savingaccount and allow the cash belonging to Shri Tarlochan Singh to bedeposited in her account and be routed for purchasing the pure gold coinsfor Shri Tarlochan Singh. The petitioner under the bonafide belief that therewas nothing wrong in facilitating the said transaction, agreed to thatarrangement and pursuant thereto an amount of.L24,38,830/- was depositedin her account on 26.10.2008 at the instance of Shri Amit Kashyap,Manager which amount was thereafter utilized for purchase of the goldcoins for and on behalf of Shri Tarlochan Singh. The petitioner was calledupon by the Assessing officer to explain the source of the amount in heraccount. The petitioner submitted the entire facts to the Assessing Officer,She also placed on record the affidavit of Shri Tarlochan Singh explainingthe exact position. The Assessing officer after examining the record treatedthe said amount as unexplained investment of the petitioner under section CWP No.12/0 of 2014 CWP No.12/0 of 2014 69 of the Act and vide his order dated $.12.2011, Annexure P.3 assessed theincome of the assessee at LT25,71,000/- and raised a consequential demandotLv10,37,474/- towards tax and interest in the hands of the petitioner.Aggrieved thereby, the petitioner filed an application under section 264 ofthe Act seeking revision of the order passed by the Assessing Officer.During the course of revision proceedings, Shri Amit Kashyap, Manager ofthe bank in compliance to the summons issued under section 131 of the Actappeared before the respondent and furnished affidavit dated 28.5.2012stating that in order to achieve the target of selling the gold coins from hisbranch, he persuaded the petitioner to permit to enroute the amount of ShriTarlochan Singh through her account for purchase of the said coins as thepurchase of coins was not permitted through NRE account. The CIT videorder dated 28.3.2013, Annexure P.6 dismissed the application for revisionof the order passed by the Assessing Officer, making addition of —=24,39,000/-. The petitioner submits that since no appeal lies against the saidorder, she 1s before this court through the present petition. 3)Learned counsel for the petitioner submitted that affidavitdated 2.8.2011 (Annexure P.1) of Tarlochan Singh son of Shri Gian Singhfrom whom the amount had been received was filed before the Assessingauthority and affidavit of Shri Amit Kashyap, the Bank Manager withHDFC Bank Kapurthala Branch dated 28.5.2012, Annexure P.2 was alsofiled. The source of cash deposit ofv24,38,826/- relating to purchase ofgold coins by the petitioner on behalf of Tarlochan Singh was explained. The Assessing Officer vide order dated 5.12.2011, Annexure P.3 and theCIT while passing order dated 28.3.2013, Annexure P.6 under section 264 of CWP No.12/0 of 2014 the Act had completely ignored the same. Furthermore, the CIT had passedthe order which 1s not a speaking one. Reliance was placed on judgment ofthe Apex Court inCIT vs. Smt.P.K.Noorjahan,(1999) 237 ITR 570 tosubmit that addition under section 69 of the Act 1s within the discretion ofthe Assessing officer as according to the words used in the said section, itwas incumbent upon the Assessing Officer to consider the facts andcircumstances of the case before making an addition of LT24,39,000/-. 4After hearing learned counsel for the petitioner, we do not findany merit in the writ petition. 4]It would be expedient to refer to Section 264 of the Act whichreads thus:- “764. Revision of other orders (1) In the case of any order other than an order to which section263 applies passed by an authority subordinate to him, theCommissioner may, either of his own motion or on anapplication by the assessee for revision, call for the record ofany proceeding under this Act in which any such order hasbeen passed and may make such inquiry or cause such inquiryto be made and, subject to the provisions of this Act, may passsuch order thereon, not being an order prejudicial to theassessee, as he thinks fit. (2) The Commissioner shall not of his own motion revise anyorder under this section 1f the order has heen made more thanone year previously. (3) In the case of an application for revision under this sectionby the assessee, the application must be made within one yearfrom the date on which the order in question wascommunicated to him or the date on which he otherwise cameto know of it, whichever 1s earlier: Provided that the Commissioner may, 1f he 1s satisfied that theassessee was prevented by sufficient cause from making theapplication within that period, admit an application made afterthe expiry of that period. (4) The Commissioner shall not revise any order under thissection in the following cases - (2) The Commissioner shall not of his own motion revise anyorder under this section 1f the order has heen made more thanone year previously. (3) In the case of an application for revision under this sectionby the assessee, the application must be made within one yearfrom the date on which the order in question wascommunicated to him or the date on which he otherwise cameto know of it, whichever 1s earlier: Provided that the Commissioner may, 1f he 1s satisfied that theassessee was prevented by sufficient cause from making theapplication within that period, admit an application made afterthe expiry of that period. (4) The Commissioner shall not revise any order under thissection in the following cases - (a) where an appeal against the order lies to the DeputyCommissioner (Appeals) or to the Commissioner(Appeals) or to the Appellate Tribunal but has not beenmade and the time within which such appeal may be madehas not expired, or, in the case of an appeal to theCommissioner (Appeals) or to the Appellate Tribunal, theassessee has not waived his right of appeal; or (b) where the order 1s pending on an appeal before theDeputy Commissioner (Appeals); or (c) where the order has been made the subject of anappeal to the Commissioner (Appeals) or to the AppellateTribunal. (5) Every application by an assessee for revision under thissection shall be accompanied by a fee of five hundredrupees, (6) On every application by an assessee for revision underthis sub-section, made on or after the Ist day of October,1998, an order shall be passed within one year from the endof the financial year in which such application 1s made by theassessee for rev1sion. Explanation: In computing the period of limitation for thepurposes of this sub-section, the time taken in giving an opportunity to the assessee to be reheard under the proviso tosection 129 and any period during which any proceedingunder this section 1s stayed by an order or injunction of anycourt shall be excluded. (7) Notwithstanding anything contained in sub-section (6),an order in revision under sub-section (6) may be passed atany time in consequence of or to give effect to any finding ordirection contained in an order of the Appellate Tribunal,National Tax Tribunal, the High Court or the Supreme Court. Explanation 1: An order by the Commissioner declining tointerfere shall, for the purposes of this section, be deemednot to be an order prejudicial to the assessee. Explanation 2: For the purposes of this section, the DeputyCommissioner (Appeals) shall be deemed to be an authoritysubordinate to the Commuissioner. 6.A reading of the above show that the assessee can moveCommissioner of Income Tax for revising the order passed by an authoritywithin the period of one year from the date on which the order 1scommunicated to him or when he comes to know of the order whichever 1searlier. If due to sufficient cause the assessee cannot file revision within theprescribed period, the Commissioner may condone the delay and admit theapplication even after expiry of that period. TiThe Assessing Officer while making addition ofLT24,39,000/-vide order dated 5.12.2011, Annexure P.3 had noticed as under:- “To verify the facts, a letter was issued to the bank Manager,HDFC Bank Limited, Kapurthala on 13.9.2011. In response to this letter Shri Dinesh Sarna filed copies of two withdrawalvouchers filed in bank by S.Tarlochan Singh and copy ofdeposit voucher of Miss Veena on 4.10.2011, the details ofthe withdrawal made by Shri Tarlochan Singh are as under:- TiThe Assessing Officer while making addition ofLT24,39,000/-vide order dated 5.12.2011, Annexure P.3 had noticed as under:- “To verify the facts, a letter was issued to the bank Manager,HDFC Bank Limited, Kapurthala on 13.9.2011. In response to this letter Shri Dinesh Sarna filed copies of two withdrawalvouchers filed in bank by S.Tarlochan Singh and copy ofdeposit voucher of Miss Veena on 4.10.2011, the details ofthe withdrawal made by Shri Tarlochan Singh are as under:- From the above details, it 1s noticed that S.Tarlochan Singhwithdrew=a5 lacs on 4.9.2008 and|=a20 lacs on 16.99.2008 angave the same amount to Miss Veena on 16.9.2008 for purchaseof gold. Miss Veena depositedan24,39,000/- only into hersaving account on 26.10.2008. It 1s not clear why such hugeamount was kept for one month and 10 days in her custody. Asper affidavit of S.Tarlochan Singh this amount was given toMiss Veena for purchase of gold. Instead of depositing she keptthis amount in her house. The above explanation 1s not reliable.Secondly deposited denomination of notes are not tallied withthe denomination of notes withdrawn by S.Tarlochan Singh asmentioned above. To verify these facts, summon under Section131 was issued to Miss Veena d/o Shri Sham Lal on10.10.2011. Inspector of this office has reported that sherefused to accept this summon but she assured that she willvisit the office at 2.30 pm on the same day but she did notattend this office till date. Thirdly she filed return of income for the said year declaringncome or.Lv1,32,000/- after claiming expenses ofa18,000/-from the job work of boutique. Her counsel filed written reply on 23.8.2011 which stated that being bank employee and toachieve the target of gold sale in Diwali period she received asum of v25 lacs from S.Tarlochan Singh son of Shri Giansingh Village Thekriwal PO Nurpur District Kapruthala but shedid not declare any salary income received from the bank. Aletter bearing No.1636 dated 13.9.2011 issued to the Manager,HDFC bank Limited, MGN Public School, Kapurthala whowas requested to intimate the exact date of her joining andrelieving. In response to this query her counsel filed writtenreply on 4.10.2011 stating therein that Miss Veena was neveremployee of bank at that time now she 1s employee with thatbank. Subsequently a letter was issued to Miss Veena d/o ShriSham Lal, H.No.59/4, Deol Nagar, Nakodar Road, Jalandhar on25.11.2011 1n which she was requested to intimate the date ofjoining and relieving from the said branch, total salary drawnduring the said year and a copy of the appointment letter of thebank fixing the case for hearing on 30.11.2011 but no reply hasbeen received so far. [It 1s clear that assessee was not banemployee in the said year and wants to say nothing in thismatter. From the above facts, it is clear that writtensubmissions filed by her counsel on different dates are totallybaseless and after thought stories when onus lies on theassessee to prove its genuineness and creditworthiness of theperson from whom said amount was received but she hasreceived but she has failed to discharge the onus of proving thegenuineness and creditworthiness of the amount so received byher. Her counsel’s written submissions filed during assessmentproceedings are not satisfactory as the submission that she wasbank employee and received the cash 1n that capacity had itselfbeen found to be untrue. So total cash deposits of =a24,39,000/-in her saving account that has been used to purchase gold fromthe bank are unexplained, this amount 1s added in her returnedincome under section 69 of the Income Tax Act and penalty proceedings under Section 271(1) (c) of the Income Tax Acthave been initiated for furnishing inaccurate particulars ofincome.’ §.|Moreover, while rejecting the revision filed under section 264of the Act, the CIT vide order dated 28.3.2013, Annexure P.6 had observedas under:- proceedings under Section 271(1) (c) of the Income Tax Acthave been initiated for furnishing inaccurate particulars ofincome.’ §.|Moreover, while rejecting the revision filed under section 264of the Act, the CIT vide order dated 28.3.2013, Annexure P.6 had observedas under:- “4. | have carefully considered the assessment order passed bythe AO, the explanation which was given by the assessee at thattime, the submissions made by the assessee/assessee’s counselduring the proceedings under section 264 and even thesubmissions made by Shri Amit Kashyap. I may observe herethat the assessee could not present herself during theproceedings before the undersigned. The reasons stated to befor the same were that the assessee 1s already married and notpresent at Kapurthala or Jalandhar. 5. Position being so, | find that practically there 1s not muchdifference in the situation which has been presented before meand that which existed before the AO. Further, in the absence ofthe assessee herself, 1t was not possible to confront the assesseewith Shri Amit Kashyap who has tried to own the responsibilityfor maneuvering the entire transaction. I am therefore unable toconsider the application of the assessee favourably and thesame stands rejected.” Q It 1s clear from the orders passed by CIT and the AssessingOfficer that inspite of opportunity having been provided to the assessee toappear before them, she did not chose to appear and, therefore, Shri AmitKashyap could not be confronted to the assessee who had tried to own theresponsibility for maneuvering the entire transaction. It may be noticed thaton a query being put to the counsel for the petitioner as to why did thepetitioner enter into transaction on behalf of Tarlochan Singh who was CWP No.12/0 of 2014 stranger and had no relationship with the petitioner, learned counsel wasunable to give any reply much less satisfactory reply. In such circumstances,no illegality or perversity could be pointed out in the orders passed by theAssessing Officer and the CIT. Moreover, as regards the judgment reliedupon by the learned counsel for the appellant, 1n the facts and circumstancesof that case, the provisions of section 69 were not attracted. Therefore, theargument and reliance on the said judgment does not come to the rescue ofthe petitioner, 10.In view of the above, finding no merit in the petition, the sameis hereby dismissed. (Ajay Kumar Mittal)vudge January 24, 2014<;"/ (Anita Chaudhry)vudge