Parveen Kumar v. Commissioner Of Income Tax, Ludhiana

IN THE HIGH COURT OF PUNJAB AND HARYANA ATCHANDIGARH. LTA. No. 453 of 2017DATE OF DECISION: 16.03 2018 Parveen Kumar APPELLANT Versus Commissioner of Income Tax, Ludhiana RESPONDENT CORAM :- HON'BLE MR. JUSTICE S.J. VAZIFDAR, CHIEF JUSTICEHON'BLE MR. JUSTICE AVNEESH JHINGANHON'BLE MR. JUSTICE AVNEESH JHINGAN Present:Mr. Sunil K. Mukhi, Advocate,for the appellant.for the appellant. "SRO AVNEESH JHINGAN, J. This 1s an appeal against the order of the Income Tax Appellate Tribunal partly allowing the appeal of the assessee. |The matter pertains to the assessment year 2011-12. 3]According to the appellant, the following substantial questions of law arise in this appeal :- (4)Whether the ITAT 1s justified in confirming addition of =15,49,420/- without appreciating the cash-in-handavailable as on 01.04.2010 to the extent of 410,94,260/-and without doubting the veracity of cash book even bythe Departmental Representative after granting partialrelief ofL> lakh without appreciating the Peak Theory’duly accepted by this Hon'ble High Court in the case ofVed Parkash vs. CIT in ITA 235 of 2015 decided oni15,49,420/- without appreciating the cash-in-handavailable as on 01.04.2010 to the extent of 410,94,260/-and without doubting the veracity of cash book even bythe Departmental Representative after granting partialrelief ofL> lakh without appreciating the Peak Theory’duly accepted by this Hon'ble High Court in the case ofVed Parkash vs. CIT in ITA 235 of 2015 decided oni ITA No. 453 of 2017 ~)_ ?%%@ ?%%%@ (iv) 02.07.2015wherein the peak being=8,/1,131/- thus theaddition having been based on suspicion without anyadverse evidence against the appellant and converselywithout appreciating cogent and plausible reasons withevidence filed therein, which finding is perverse? Whether the [TAT 1s justified in confirming addition of 414,40,000/- 1n the joint account with grandfather whobeing the first account holder without appreciatingvarious evidences filed having direct bearing on the factsof the case and thereby rejecting additional evidencebeing bank certificates confirming that all thetransactions were being done by grandfather, the additionbeing on technical grounds, based on suspicion and thusbeing perverse’? Whether the ITAT 1s justified in dismissing the appealignoring the well settled law in the case ofTek Ram(Dead) through LRs Versus Commissioner of Income Tax, Faridabad 3357 TTR 133 (SC) while rejectingadditional evidence having substantive effect on the caseand thus finding of the ITAT are perverse and deserve tobe set aside? Whether the order of ITAT 1s perverse and deserves to beset aside being devoid of proper appreciation of facts andagainst well settled law?” 4 The assessee filed the return showing income under the head ‘salary’ only. The case was taken up for scrutiny. The Assessing Officer(AO) vide order dated 25.02.2014 finalised the assessment under Section143 (3) of the Income Tax Act, 1961. The AO made additions ofL20,49,420/- and |414,40,000/-, the amounts deposited in cash in Bankaccounts, as income from undisclosed sources. Interest received from FDRs ITA No. 453 of 2017 -~3 not disclosed in the return was also added. 4]The Commissioner of Income Tax (Appeals)-I, Ludhiana [CIT(A)| dismissed the appeal vide order dated 30.11.2015, 6]The Tribunal partly allowed the appeal vide its order dated06.03.2017. The addition made ot =20,49,420/- was reduced by=5 lakh.The other addition made of|414,40,000/- was affirmed. Re:Question No. (1) TiQuestion No. (1) in the appeal relates to addition confirmed by|Tribunal of415,49,420/-. ITA No. 453 of 2017 -~3 not disclosed in the return was also added. 4]The Commissioner of Income Tax (Appeals)-I, Ludhiana [CIT(A)| dismissed the appeal vide order dated 30.11.2015, 6]The Tribunal partly allowed the appeal vide its order dated06.03.2017. The addition made ot =20,49,420/- was reduced by=5 lakh.The other addition made of|414,40,000/- was affirmed. Re:Question No. (1) TiQuestion No. (1) in the appeal relates to addition confirmed by|Tribunal of415,49,420/-. § The relevant facts are that the appellant filed return showingonly the salary income. Questionnaire was issued during the assessmentproceedings asking for details of the bank accounts. The assessee furnishedhis bank account statement with Axis Bank in respect of account No.197010100090146. Later on, he furnished the bank statement of his accountNo. 197010100090401 with Axis Bank, stating that it was his salaryaccount. There was a cash deposit of=23,39,420/- in bank account No.197010100090146. The assessee explained that the cash deposited was fromthe salary earned during the period from 2007-08 to 2011-12. The salarywas drawn from a brick kiln firm M/s Om Parkash Sunder Lal B.K.O,Narnaud, Jind during the assessment years 2007-08 and 2008-09. In thisfirm, the grand-father of the appellant was a partner. During the assessmentyears 2009-10 to 2011-12, he had a joint account in Axis Bank. He statedthat the funds were rotated from time to time and hence, the cash wasdeposited. He failed to prove that the cash withdrawal made from his salary ITA No. 453 of 2017 _4_ account was deposited in bank account No. 197010100090146. It was notedthat the withdrawals were through ATMs or cash from same account. Givingthe benefit of the fact that there could have been cash re-deposited, the AOmade an addition of.420,49,420/- under Section 69, giving a benefit of=3lakh| Q The appellant adduced additional evidence before CIT (A). Thesame was considered. Remand report was asked for. The CIT (A) consideredthe facts and the evidence produced. The claim of the appellant of havingopening balance of41,65,850/- from salaries earned upto 31.03.2008 was)rejected after verifying bank details from the system of department andtaking into account the withdrawals made. The claim that appellant hadreceived some money for labour contract from M/s Parkash Rice & GeneralMulls was rejected as he failed to substantiate that there was some actualreceipt of money. Copy of the Profit & Loss Account of M/s Parkash Rice &General Mills was not produced. There was no proof with the appellant toshow that there was cash 1n hand of|=8,86,639/- as on 31.03.2010. Theappeal was dismissed, 10.Tribunal re-appreciated the evidence and concluded that thoughthe authorities below have given the benefit of43 lakh of re-deposit of cashbut have not considered that during the previous years, the appellant wouldhave accumulated funds, for which a further benefit of => lakh was given.The Tribunal came to the conclusion that there was no specific evidence tosupport the opening balance of48,86,639/- as on 01.04.2010. The evidencewas not there to explain the cash deposits made to the tune of=23,39,420/-There was nothing on record to support the fact that the amounts withdrawn ITA No. 453 of 2017 -5- from the salary account were re-deposited. The FDRs of the appellantindicated that he was intelligently investing the amount with the bank. Thebenefit of re-deposits and of accumulated funds for the previous year hasalready been given. 11.The question raised is a question of fact, as the issue 1s onlyregarding appreciation of evidence. No interference is called for in thefindings recorded by the Tribunal affirming the addition ofL15,49,420/- Re:Question No. (11) ITA No. 453 of 2017 -5- from the salary account were re-deposited. The FDRs of the appellantindicated that he was intelligently investing the amount with the bank. Thebenefit of re-deposits and of accumulated funds for the previous year hasalready been given. 11.The question raised is a question of fact, as the issue 1s onlyregarding appreciation of evidence. No interference is called for in thefindings recorded by the Tribunal affirming the addition ofL15,49,420/- Re:Question No. (11) 12)An addition of.=14,40,000/- was made for cash deposited injoint bank account No. 19701010011034 of Shri Om Parkash (maternalgrand-father of the appellant) and the appellant.13.During the assessment proceedings, in spite of specific queriesin the questionnaire and in subsequent letters, the appellant never disclosedthe said bank account to the authorities. The authorities had AnnualInformation Return (AIR) information. The appellant denied having anysuch joint account with Shri Om Parkash. The authorities confronted himwith the bank statement and asked for the source of cash deposits made. Atthat stage, the assessee replied that the account was of his maternal grand-father, who expired on 10.11.2011 and all transactions related to his grand-father only. It was stated that his name was added Just to assist his 85 yearsold maternal grand-father for operating the bank account. In his statement,the appellant stated that the source of income of his grand-father was onlyrental income ofL3,630/- per month. But during the period from06.05.2010 to 05.03.2011, cash deposits worthL14,40,000/- were made in) ITA No. 453 of 2017 -6§ the account. It was further noted that even after the death of his grand-father, the appellant was continuously operating the account.14.In appeal before the CIT (A), the appellant adduced additionalevidence in the shape of bank statement and balance sheet of M/s OmParkash Sunder Lal B.K.O, in which Shri Om Parkash, maternal grand-father of the appellant, was stated to be a partner. The said additionalevidence was considered. The evidence produced in no way enhanced thecase of the appellant. The bank statement only showed that apart from otherdeposits, there were cash deposits of|=8,16,000/- made on 11.06.2010 and)=4,08,000/- made on 12.06.2010. The appellant never proved that theamounts deposited were from the sources of income of Shri Om Parkash.The retirement deed was filed showing that Shri Om Parkash retired fromthe firm on 31.03.2010 and the balance sheet filed showed that there wascapital of44,46,615/-. No proof was adduced to show that the standing!capital amount was re-paid by the firm to Shri Om Parkash. There was noevidence regarding the date of payment or mode of payment from the firmto Shr1 Om Parkash. The reliance on the cash book of Shri Om Parkash wasfound baseless as it showed an opening balance of =8,50,528/- as on01.04.2010, for which there was no proof of entries or source of openingbalance. The addition was affirmed by the CIT (A).14)Before the Tribunal, the appellant relied upon a bank certificatedated 30.08.2016 and copy of capital account of Shri Om Parkash. The saiddocuments were produced first time before the Tribunal without anyapplication for permission to produce additional evidence. The Tribunal ITA No. 453 of 2017 _/- confirmed the order of the AO and the CIT (A) regarding addition made ofL14,40,000/-. ITA No. 453 of 2017 _/- confirmed the order of the AO and the CIT (A) regarding addition made ofL14,40,000/-. 16.The question raised is one of fact. Addition made was onappreciation of facts. The appellant kept on denying that he had any jointaccount with his grand-father. His claim that his name was added in theaccount only for helping his old maternal grand-father for operating theaccount 1s belied by the fact that the ration card produced showed that ShriOm Parkash was staying with his two sons who could have helped him foroperating the account. Shri Om Parkash had his own PAN number, yet PANnumber of the appellant was mentioned in the bank account. Theexplanation furnished by the appellant that Shri Om Parkash was partner inM/s Om ParkashSunder Lal B.K.O was of no help, as no income tax returnsof the B.K.O were placed on record. There was no evidence to show that thesaid capital was ever received by Shri Om Parkash. Reliance was placed ona self serving capital account prepared but the appellant failed to establishthat Shri Om Parkash had any other source of income, except the rentalincome ofv3,630/- per month. 17.The view taken by the Tribunal is a possible view and by nostretch of imagination can be said to be perverse. The question raised 1s nota question of law, much less a substantial question of law. No interference 1scalled for by this Court in appeal under Section 260-A of the Acct. Re:Questions No. (11) and (iv) 18)So far as rejecting the additional evidence is concerned, nosuch application was moved before the Tribunal for permitting production ITA No. 453 of 2017 -§- of additional evidence. Even otherwise, the capital account of Shri OmParkash was a self serving document prepared without any basis. The saidcapital account showed opening balance of|L8,90,528/-, for which therewas no source or basis. The appellant failed to give any reason as to whythese documents could not be produced earlier, 19)In view of the answers to questions No. (1) and (11), noperversity has been established. The issues raised are only of appreciation offacts. The conclusions arrived at are logical. In appeal filed under Section260-A, the evidence cannot be re-appreciated. There 1s no warrant forinterference with the order passed by the Tribunal. 20.The questions are answered against the appellant. 21.The appeal is dismissed. (S.J. VAZIFDAR )CHIEF JUSTICE March 16, 2018(AVNEESH JHINGAN )ndjJUDGE ndj Whether speaking/reasonedYesWhether ReportableYes