K.Sudheer Eluru – Unexplained cash deposit

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ITA No.161/Vizag/2014
Sri Kanigolla Sudheer, Eluru

unexplained cash deposit
unexplained cash deposit
unexplained cash deposit
unexplained cash deposit
unexplained cash deposit
unexplained cash deposit
unexplained cash deposit
unexplained cash deposit
unexplained cash deposit
unexplained cash deposit
unexplained cash deposit
unexplained cash deposit
unexplained cash deposit

unexplained cash deposit
unexplained cash deposit
unexplained cash deposit
unexplained cash deposit
unexplained cash deposit
unexplained cash deposit
unexplained cash deposit
unexplained cash deposit

IN THE INCOME TAX APPELLATE TRIBUNAL,
VISAKHAPATNAM BENCH, VISAKHAPATNAM

BEFORE SHRI V. DURGA RAO, JUDICIAL MEMBER &
SHRI G. MANJUNATHA, ACCOUNTANT MEMBER

./I.T.A.No.161/Vizag/2014

(/ Assessment Year: 2010-11)

ITO , Ward -1, Sri Kanigolla Sudheer
Eluru Vs. Eluru
[PAN: ARUPK1046K ]
( / Appellant) (&’???% / Respondent)

C.O. No.39/Vizag/2014
(Arising out of I.T.A.No.161/Vizag/2014)
(????? ?? / Assessment Year: 2010-11)

Sri Kanigolla Sudheer ITO , Ward -1,

Eluru Eluru
Vs.

(??????% / Appellant) (&’???% / Respondent)

/ Appellant by : Shri M.N. Murthy Naik, DR

/ Respondent by : Shri G.V.N. Hari, AR

/ Date of hearing : 24.03.2016
/ Date of Pronouncement : 31.03.2016

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ITA No.161/Vizag/2014
Sri Kanigolla Sudheer, Eluru

???? / O R D E R

PER G. MANJUNATHA, Accountant Member:

unexplained cash deposit
unexplained cash deposit
unexplained cash deposit
unexplained cash deposit
unexplained cash deposit
unexplained cash deposit
unexplained cash deposit

This appeal filed by the Revenue and Cross objection filed by the

assessee, are directed against the order of Commissioner of Income –

tax (Appeals), Visakhapatnam Dated 22-02-2014 and it pertains to the

Asst. Year 2010-11. Since, the issue involved in these appeals are

common, they are clubbed, heard together and disposed off, by way of

this common order for the sake of convenience.

2. The brief facts of the case are that the assessee is an individual,

filed his return of income for the A.Y.2010-11 on 9-9-2010 declaring

total income of Rs. 2,92,240/-. The case has been selected for scrutiny,

accordingly, notice under sec. 143(2) and 142(1) of the Income tax Act,

1961 were issued. In response to notice, the authorised representative

of the assessee appeared and filed necessary details. During the course

of assessment proceedings, the A.O. noticed that the assessee is

operating a savings bank account at ICICI Bank Eluru, which was found

credited with cash deposits of Rs. 34,00,000/- on 5 days between 25-1-

2010 to 24-3-2010. Therefore, issued a show cause notice on 9-7-2012

and asked to explain the nature and source of cash deposits into the

bank account. In response to show cause notice, the assessee neither

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———————Page 3———————

ITA No.161/Vizag/2014
Sri Kanigolla Sudheer, Eluru

appeared nor furnished any details. The A.O. issued further letter on 19-

10-2012 and requested to furnish the details with regard to cash

deposits. In response letter, the assessee neither appeared nor

furnished any information. Since, no information is coming from the

assessee, the A.O. has treated total cash deposits of Rs. 34,00,000/- as

unexplained cash credit and brought to tax u/s 68 of the Act.

3. Aggrieved by the assessment order, the assessee preferred an

appeal before the CIT(A). Before the CIT(A), the assessee filed

additional evidence by filing petition for admission of additional evidence

and submitted that the impugned cash deposits were received from M/s

Ambica Channakeshava Projects Limited, Hyderabad for the purpose of

purchase a property for that company. The assessee further submitted

that he had obtained a confirmation letter on 9-12-2012 and the same

has been submitted to A.O. on 10-12-2012. However, by the time the

A.O. has completed the assessment, therefore not considered the

confirmation letter. During the course of appellate proceedings, the

additional evidences filed by the assessee were forwarded to the A.O.

for his comments. The A.O. vide his remand report dated 4-11-2013 and

3-1-2014 submitted that the sources for the cash deposits has been

verified with reference to confirmation letter, ledger account copy, cash

book and income tax returns of Company and found that the cash
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ITA No.161/Vizag/2014
Sri Kanigolla Sudheer, Eluru

deposits in assessee bank account were drawn from the company on

respective dates. Therefore, the A.O. concluded that the identity, credit

worthiness and genuineness of the transaction is proved and the

additional evidences filed by the assessee may be accepted. The CIT(A),

after considering the additional evidences filed by the assessee and also

taken into account the remand report of the A.O. deleted the addition of

` 34,00,000/- made under sec. 68 of the Act. Aggrieved by the CIT(A)

order, the Revenue is in appeal before us.

4. We have heard both the parties and perused the materials

available on record. The A.O. made addition under sec. 68 towards cash

deposits for the reason that the assessee has not filed any evidence to

prove the nature of credit and source for credit in the bank account.

During the course of appellate proceedings, the A.O. has issued a

remand report dated 3-1-2014 and has accepted the additional

evidences filed by the assessee and concluded that the assessee has

proved the identity, creditworthiness and genuineness of the

transaction. The CIT(A), based on the evidences filed by the assessee

and also taken into account the remand report of A.O. deleted the

addition. The relevant paragraph of A.O. is extracted below.

“5. The above additional evidence was forwarded to the assessing
officer for his comments and also for a report after necessary inquiry.
The assessing officer filed its report vide letter dt.4.11.2013 and
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ITA No.161/Vizag/2014
Sri Kanigolla Sudheer, Eluru

03.01.2014. During the remand proceedings, the assessing officer had
examined the Managing Director of M/s. Ambica Chenna Kesava Projects
Limited who had issued the said confirmation letter. In the report it was
stated that Shri PT.N.V.A.R. Sudarshan, Managing Director appeared and
produced the books of account of the company. The said Managing
Director also confirmed to the AC that the amounts were deposited in
the accounts of the assessee out of the cash balance of the company.
The assessing officer had also verified the books of accounts of the
company and found that there were withdrawals from the cash book of
the company on the respective dates for depositing the cash in the
savings bank account of the assessee. Hence, the assessing officer
concluded in his report that as the identity of the creditor, the credit-
worthiness of the creditor and the genuineness of the transaction are
proved the additional evidence filed may be accepted as genuine. In
view of the above findings of the AC based in the inquiry, the source for
the impugned cash deposits to the tune of Rs.34,00,000/- can be
considered to be explained. In these factual scenario, the assessing
officer is directed to delete the impugned addition.”

5. We find that CIT(A) has considered relevant evidences such as

confirmation letters and books of accounts of M/s Ambica Channakesava

Projects Limited and find that the cash deposits into assessee savings

bank account at ICICI Bank, Eluru were withdrawn from the Company.

The facts remain same even before us. The Revenue has failed to

brought on record any evidences to prove that the findings of the fact

recorded by CIT(A) is incorrect. Therefore, we are of the opinion that

the CIT(A) has rightly deleted the addition. We do not see any reason to

interfere with CIT(A) order, hence, we inclined to upheld the CIT(A)

order and dismiss the appeal filed by the revenue.

6. The Cross objection filed by the assessee is supporting the order

of CIT(A). We, therefore, for the reasons recorded in the preceding

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ITA No.161/Vizag/2014
Sri Kanigolla Sudheer, Eluru

paragraphs, of the opinion that the cross objection filed by the assessee

is infructous and hence, the same is dismissed.

7. In the result, the appeal filed by the Revenue and Cross objection

filed by the assessee are dismissed.

st
The above order was pronounced in the open court on 31 Mar’16.

Sd/- Sd/-
(?? . ???????? ) (?? . ???????? )

(V. DURGA RAO) (G. MANJUNATHA)
ˆ????? ???? /JUDICIAL MEMBER ???? ???? /ACCOUNTANT MEMBER

#????????? /Visakhapatnam:
‘????? /Dated : 31.03.2016
VG/SPS

???? ? ??)?#? ?*?#?? /Copy of the order forwarded to:-
1. ?????? / The Appellant – The ITO Ward-1, KKS Towers, RR Pet, Eluru
2. ????? / The Respondent – Shri Kanigolla Sudheer, S/o Jagat Kumar, D.No.3B-17-
22/1-2, Senagappappu Bazar, Eluru-534001.
3. ???? ??+?? / The CIT, Visakhapatnam
4. ???? ??+?? (???? ) / The CIT (A), Visakhapatnam
5. #?????? ???.? , ?? ?? ?????? ?.???? , #????????? /
DR, ITAT, Visakhapatnam
6. ??? ???? / Guard file
?????????? / BY ORDER

// True Copy //
?1?2? ??? ?.?? (Sr.Private Secretary)
?? ?? ?????? ?.???? , #????????? /
ITAT, VISAKHAPATNAM

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Ashni Shah is pursuing Chartered Accountancy and is currently engaged as Article Assistant at Rasesh Shah and Associates and can be reached at ashnishah2017@gmail.com. She loves Dancing and Gyming.

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