TMI Blog2014 (8) TMI 1059X X X X Extracts X X X X X X X X Extracts X X X X ..... see to explain from where the assessee got the funds for making investment and why the same should not be treated as income of the assessee. The assessee has no explanation to offer. Therefore, this Tribunal is of the considered opinion that the assessing officer has rightly taken the entire amount as income of the assessee. This Tribunal do not find any infirmity in the order of the lower authority. Accordingly the same is confirmed. - Decided against assessee Addition towards unexplained investment in the bank account and profit from sale of land - Held that:- The assessee has to explain the source for making investment in the landed property. The assessee is engaged in the real estate business, therefore, the profit arising out of purchase and sale of real estate has to be treated as unexplained income. In the absence of any details, this Tribunal is of the considered opinion that the CIT(A) has rightly confirmed the addition. It is for the assessee to explain the source for making the deposit in the bank and the source for making the investment in the landed property. It is also the responsibility of the assessee why such investment should not be treated as income of the ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he lower authority is set aside and the assessing officer is directed to delete the addition of ₹ 2,91,600 with regard to cash withdrawal from the bank as shown in the cash flow statement. - Decided against assessee in part Addition of foreign travel expenses - Held that:- It is an admitted fact that the assessee undertook foreign travel during the year under consideration. The source for the expenditure was not disclosed before the assessing officer. It is also not disclosed in the cash flow statement. The assessee is also not maintaining any books. In those circumstances, the CIT(A) has rightly made addition to the extent of ₹ 5 lakhs. In total the unexplained investment and expenditure to the tune of ₹ 33,75,410 is confirmed out of the addition of ₹ 36,67,010. The assessing officer is directed to delete the addition of ₹ 2,91,600. - Decided against revenue - I.T.A No. 42 to 44/Coch/2014, I.T.A No. 45 to 51/Coch/2014 - - - Dated:- 8-8-2014 - Shri N.R.S. Ganesan (JM) and Shri Chandra Poojari (AM) For the Appellant: Shri CBM Warrier For the Respondent: Shri M Anil Kumar, CIT O R D E R Per N.R.S. Ganesan (JM) All the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , the ld.representative for the assessee very fairly conceded that he satisfied that there was search in the case of Smt. Asha Sunil also, therefore, he withdrew the additional ground filed before this Tribunal with regard to the validity of the assessment framed u/s 153A of the Act. In view of the above factual position that the assessment was framed u/s 153A of the Act on the basis of the search conducted in the premises of the assessee on 13-03-2008, the additional ground raised by the assessee has no merit at all. Moreover, the ld.representative also submitted that he is withdrawing the additional ground of appeal. Accordingly, the additional ground of appeal filed by the assessee is dismissed. 6. Now coming to the merit of the addition, the first addition is ₹ 3,33,815 as unexplained credits in the bank account. 7. The ld.representative for the assessee submitted that the deposits were made out of the trading receipts from garment business. The assessing officer, without considering the explanation of the assessee has made the addition. 8. On the contrary, Shri M Anil Kumar, the ld.DR submitted that though the assessee is engaged in the garment business, the net ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... entative for the assessee submitted that the assessing officer made addition of ₹ 38,39,969 towards unexplained investment in the bank account and profit from sale of land. According to the ld.representative, the assessee explained that the deposits were made in the bank from sale proceeds of the land. However, the assessing officer found that the land itself was purchased on 07-04-2006 and the investment in the landed property was not explained. The assessing officer has also treated the profit on sale of the land to the extent of ₹ 5,93,100 as business profit. According to the ld.representative, these deposits were made from trading receipts and from the sale proceeds of the land. We heard Shri M Anil Kumar, the ld.DR also. 14. Though the assessee explains that the deposits were made from sale proceeds of the land, the details of transactions and sale of the land were not filed before the assessing officer. The assessing officer found that the property sold by the assessee itself was purchased on 07-04-2006 during the assessment year under consideration. Therefore, the assessee has to explain the source for making investment in the landed property. The assessee is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he hands of the assessee. According to the ld.representative, the money was routed through banking channel from the assessee s father s account, therefore, the assessee is not the owner of the money. Assessee s father gifted the money to the assessee. In those circumstances, according to the ld.epresentative, addition made by the assessing officer is not justified. 18. On the contrary, Shri M Anil Kumar, the ld.DR submitted that the Financial Intelligent Wing received an information about the transfer of funds from Singapore to City Bank in the assessee s father s account and further transfer to assessee s account. The assessee by a notice dated 07-09-2009 was requested to furnish specific information with regard to transfer of funds. The assessee could not produce any explanation. Though the assessee filed confirmation letter from her father Shri George Philip, the creditworthiness of Shri George Philip for making such huge gift was not filed before the lower authorities. According to the ld.DR, the money was found to be credited in the account of the assessee from City Bank in Singapore. The letter said to be written by Shri George Philip does not disclose the source of earnin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r transfer of funds from undisclosed / unidentified person to Smt. Asha Sunil. The fact that the credit of the above amounts to the account of Shri George Philip is a suspicious transaction reported by the Bank to the Financial Intelligence Unit, Ministry of Finance points out the doubtful nature of the receipts. 20. From this it is obvious that the funds were transferred to the assessee s father s account by T.T. transfer and again it was retransferred to assessee s account. Therefore, it is for the assessee to explain how the assessee s father got the funds. The assessing officer has taken pain in examining assessee s father. However, he could not give any satisfactory explanation except by saying that it was his savings and salary. In the absence of any material to show that the assessee s father has saved so much of money, this Tribunal is of the considered opinion that the claim of the assessee / her father that the transfer was from savings of her father cannot be accepted. To accept the gift, the assessee has to definitely establish the creditworthiness of her father. The contention of the ld.counsel for the assessee is that if the assessee could not explain the creditw ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or making deposit in the bank account. Therefore, it should not be taken as income of the assessee. Cash withdrawal from the bank to the extent of ₹ 2,91,600 was also taken as income of the assessee. According to the ld.representative, once the deposit was taken as income, the withdrawal should not be taken as income once again. 24. Referring to the foreign travel expenses, the ld.representative submitted that the assessing officer made addition of ₹ 5 lakhs towards foreign travel expenses. According to the ld.representative, the foreign travel expenses were made from the withdrawals made from the bank account. 25. On the contrary, the ld.DR, Shri M Anil Kumar submitted that during the course of search operation several materials were found with regard to deposit of money in the bank and investments. The assessee has also filed a cash flow statement before the assessing officer during the course of assessment proceedings. For the assessment year 2002-03, the assessee has disclosed only a deposit of ₹ 8,76,500 in the cash flow statement. However, the material found by the assessing officer disclosed deposit of ₹ 15,04,891. The assessee has also shown cr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cash flow statement. If the assessee has taken loan from others it is for the assessee to explain the identity of the persons, who gave the money on loan, the creditworthiness of the creditors and the genuineness of the transactions. In the absence of any details and the assessee has disclosed the same as suspense account, this Tribunal is of the considered opinion that the assessing officer has rightly taken the same as income of the assessee. It is unfortunate that even the repayment of housing loan to HDFC bank could not be explained by the assessee before the lower authorities. Therefore, the repayment of loan to HDFC bank has to be taken as income of the assessee. 28. The assessee has withdrawn an amount of ₹ 2,91,600 from the bank. Since the amount was withdrawn from bank out of the deposit made in the bank, this Tribunal is of the considered opinion that ₹ 2,91,600 which was withdrawn from bank cannot be treated as income of the assessee. In other words, the amount of ₹ 2,91,600 was part of ₹ 15,04,891 which was already added by the assessing officer and addition of ₹ 2,91,600 once again would amount to double addition. Therefore, this Tribun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Therefore, the reasons given by the Tribunal for the assessment year 2002-03 are equally applicable for other years under considerations. Accordingly, we follow the decision already arrived at for the assessment year 2002-03 in these years also. Thus, the addition contested and the addition to be deleted year-wise for the assessment yeas 2003-04 to 2008- 09 on account of withdrawal from the bank account out of the deposits made is illustrated below: Assessment year Addition withdrawal from bank 2003-04 84,51,269 12,71,120 2004-05 96,95,034 11,99,600 2005-06 2,31,88,161 17,57,196 2006-07 76,07,693 27,24,607 2007-08 1,02,65,429 12,87,488 2008-09 4,55,14,549 47,04,660 31. For the detailed reasons given for the assessment year 2002-03 above, the assessing officer is directed to delete the addition of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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