I.t.a v. I.t.a

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT: THE HON'BLE THE CHIEF JUSTICE DR. MANJULA CHELLUR & THE HONOURABLE MR.JUSTICE A.M.SHAFFIQUE FRIDAY, THE 4TH DAY OF OCTOBER 2013/12TH ASWINA, 1935 ITA.No. 95 of 2012 () ---------------------- I.T.A. NO.48/COCH/2010 OF INCOME TAX APPELLATE TRIBUNAL, COCHIN BENCH.......... APPELLANT/APPELLANT: ------------------------------------- K.V. MATHEW, PROP. PHOENIX ENTERPRISES, 40/8084, MULLASSERY CANAL ROAD, ERNAKULAM, PAN : AEBPM 4915KJ. BY ADVS.SRI.ANIL D. NAIR, SRI.J.R.PREM NAVAZ, SMT.NIVEDITA A.KAMATH. RESPONDENT/RESPONDENT: -------------------------------------------- THE INCOME TAX OFFICER, WARD-2(3), RANGE - 2, ERNAKULAM. BY ADV. SRI.JOSE JOSEPH, SC, INCOME TAX. THIS INCOME TAX APPEAL HAVING COME UP FOR ADMISSION ON 04-10-2013, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: rs. ITA.No. 95 of 2012 APPENDIX PETITIONER'S ANNEXURES:- ANNEXURE ACOPY OF THE ORDER OF ASSESSMENT DATED 31/12/2007FOR THE YEAR 2005-2006 ISSUED TO THE APPELLANT.FOR THE YEAR 2005-2006 ISSUED TO THE APPELLANT. ANNEXURE BCOPY OF THE ORDER OF THE COMMISSIONER OF INCOME TAX DATED 30/11/2009 FOR THE YEAR 2005-2006 ISSUED TO THE APPELLANT.TAX DATED 30/11/2009 FOR THE YEAR 2005-2006 ISSUED TO THE APPELLANT. ANNEXURE CCOPY OF THE ORDER OF THE INCOME TAX APPELLATE TRIBUNAL, COCHIN BENCH DATED 06/01/2012. RESPONDENT'S ANNEXURES:- NIL. //TRUE COPY// P.S. TO JUDGE rs. MANJULA CHELLUR, C.J. & A.M. SHAFFIQUE, J. = = = = = = = = = = = = = = = = = = = I.T.A. NO. 95 OF 2012= = = = = == = = = = = = = = = = = = = Dated this the 4[th] day of October 2013 JUDGMENT A.M.Shaffique,J. This appeal is filed by the assessee against the order in I.T.A.No.48/Coch/2010 of the Income Tax Appellate Tribunal,Cochin Bench. The issue relates to the assessment year 2005-06. 2. The appellant is a dealer of Art and Craft paper and hefiled his return of income declaring the total income atRs.2,19,730/-. A scrutiny notice under Section 143(2) of theIncome Tax Act was issued on 18.10.2006. After hearing theasessee, it was found that in computing the total income theassessee has not considered the personal elements involved inexpenditure under the head of vehicle maintenance, hirepurchase interest on car and depreciation on car. Further it wasfound that on verification of the account, the total sundrycreditors of Rs.74,34,966/- and Rs.64,57,129/- is styled aspayable (Account - K.V.Mathew). Further it was seen that an I.T.A. NO. 95/2012 amount exceeding Rs.10 lakhs was deposited in the Savings BankAccount. The assessing officer found that there are numeroustransactions of credits and debits in the account. Though theassessee took up a contention that the amount deposited in theSavings Bank Account is the money received from his sister, theassessing officer formed an opinion that the assessee was notable to prove that the amount came through fund transfer fromItaly and it was credited to the Post Office Savings Bank Accountof his brother. The assessing officer found that the assesseefailed to prove the onus of the transaction and having reliedupon the judgment of the Supreme Court in Commissioner ofIncome Tax v. P.Mohnakala (291 ITR 278(SC) held that theexplanation offered by the assessee about the nature andsource of sums found in the credit is not satisfactory and primafacie evidence was available against the assessee. Accordingly,an amount of Rs.22,51,000/- as cash credit in S.B. account wastreated as unexplained money under Section 69A of the IncomeTax Act. That apart 1/4th disallowance out of vehiclemaintenance and hire purchase interest as attributable to I.T.A. NO. 95/2012 personal user was also added as business income. I.T.A. NO. 95/2012 personal user was also added as business income. 3. The assessee filed an appeal before the Commissioner ofIncome-tax, who after going through the entire matter in detail,dismissed the appeal. On a further appeal filed by the assesseebefore the Tribunal, the Tribunal also agreed with the viewexpressed by the assessing officer as well as the first appellateauthority. In the appeal, learned counsel for the appellant, interalia, contended that if the unexplained money is the amountreceived from a close relative and it would reflect in the accountof that person, the proper course would be to call upon thatperson to explain regarding the unexplained money. It wasfurther contended that the assessee had produced necessarydeclaration and the person from whom he received the amountalso sworn an affidavit regarding the source of income whichwas not appreciated by the authorities below. The appellantraised the following substantial question of law in thememorandum of appeal: “i)In the facts and circumstances of the case, oughtnot the Tribunal have held that there is no scope foraddition under Sec.69A of the Act on the credits which are received from Sister of the appellant who isNRI?” 4. First of all, we think that such a question of law does notarise for consideration. The assessing officer came to theconclusion that the petitioner was not in a position to explain thecredit. It is not in dispute that an amount of Rs.22,51,000/- wasseen as deposit in the Savings Bank Account of the appellant.He was under obligation to satisfy the receipt of the amounts.The assessing officer found that the appellant was not in aposition to produce any proof for the funds that he had receivedfrom Italy. No cash flow statement was filed. In a letter dated14.12.2007, as reply to the request of the department, theassesseee had only reiterated the earlier deposit stating that thefunds were withdrawn from the Savings Bank Account to advanceto his brother and when such amounts were returned by hisbrother, the same were deposited in the account. It is alsocontended that the funds have also been received from thesister when she was in station. He also sought for time to obtaindetails of the remittance from Italy. He was granted time upto I.T.A. NO. 95/2012 27/12/2007, on which date he had given a letter dated26.12.2007 making a declaration stating that his brotherMr.Thomas K.George had received amounts from his sister inItaly through Western Union Money Transfer which was creditedto the Post Office Savings Bank Account of Sri Thomas Gerogeand Raji Thomas. The amounts that were received by them fromhis sister in 2003-04 were used as temporary fund adjustmentswhich got routed in his Savings Bank Account. The assessee didnot furnish any proof regarding his claim other than producing acopy of the Post Office Savings Bank Accounts pass book. Inthat view of the matter, the assessing Officer found that therewas no proof to substantiate such contention. When theamounts in the Savings Bank account of the appellant remainedunexplained, definitely the assessing officer was justified inpassing the impugned order. This is purely a question of factwhich has been found against the petitioner and therefore whenthe other fact finding authorities, namely the first appellateauthority and the second appellate authority did not care tointerfere with the said factual findings, we do not think that any I.T.A. NO. 95/2012 question of law arises for consideration in the present appeal.The authorities have on facts held against the appellant whichcannot be countenanced by the question of law now raised bythe appellant. In the result, there is no merit in the appeal and the sameis dismissed. Sd/-MANJULA CHELLUR, CHIEF JUSTICE ks. Sd/-A.M. SHAFFIQUEJUDGE TRUE COPY P.S. TO JUDGE