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2016 (9) TMI 550 - ITAT DELHI

2016 (9) TMI 550 - ITAT DELHI - TMI - Addition household expenses and deposit in PPF account - Held that:- In the present case, the contention of the assessee that his wife alongwith his son was residing with his father-in-law who was a retired railway official and spending the money for household expenses has not been rebutted. The assessee also explained that his son was pursuing B.com from Government College, Kalka and nominal course fee was amounting to ₹ 3,000 p.a. The assessee had sh .....

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assessee also explained before the ld. CIT(A) that a rent of ₹ 1,44,000/- was paid and an amount of ₹ 70,000/- was deposited in his PPF account. Another sum of ₹ 8,712/- was paid to M/s Navin Chand Navin Kumar. In this manner, total household expenses were shown at ₹ 3,30,712/-. The assessee also explained the total funds amounting to ₹ 3,77,000/- were available with him, therefore, the addition made by the AO and sustained by the ld. CIT(A) on account of household .....

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; 1,02,059/- on account of interest income without taking into consideration the revised return; b) ₹ 3,49,000/- on account of alleged low household drawings . c) ₹ 70,000/- on account of PPF deposit; 2. not deleting but merely setting aside and restoring the matter for verification to the AO the following additions made by him - a) ₹ 3,60,000/- on account of conveyance reimbursement b) ₹ 8,712/- petty amount ₹ 8,607/- on account of disallowance of deduction u/s 80C .....

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,000/- made by the AO on account of low household expenses and vide Ground No. 1(c), the assessee is aggrieved against the sustenance of addition of ₹ 70,000/- by the AO on account of deposit in PPF account. 5. Facts related to the above issues in brief are that the assessee filed the return of income on 29.07.2011 declaring an income of ₹ 12,17,509/-. Later on, the case was selected for scrutiny. During the course of assessment proceedings, the AO noticed that the assessee had made .....

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05.04.2010 in his PPF account but no such withdrawal from his bank account had been made. He, therefore, made the addition of ₹ 70,000/- to the taxable income of the assessee. 6. Being aggrieved the assessee carried the matter to the ld. CIT(A) and submitted that the assessee was residing at Sonepat where he worked and his family consisting of wife and only son were residing at their parental hometown at Village Dharampur, Tehsil Kalka, Haryana, which is small kasba in foot hill of Himach .....

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to ₹ 3,000 per annum. It was contended that the assessee was living singly in Sonepat and having his lunch & snacks in the company s canteen, so he also did not spent more than ₹ 4000-5000 p.m. for his household expenses. The assessee submitted the details of the total household expenses as under: Particulars Amount(Rs.) Household expenses of Assessee s Family (At Dharampur, Kalka) 48,000.00 Household expense of Assessee at Sonepat 60,000.00 PPF Deposits 7 0,000.00 Rent Paid 1,4 .....

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h as on 31.03.11 (Rs.) 75,000 1,25,000 1,45,000* 32,000 3,77,000 3,30,712 46,288 8. The assessee submitted to the ld. CIT(A) that the additions made by the AO were illegal and void for the following reasons: a. In the Para 3 of the Assessment Order, Assessing Officer had given arbitrary statement totally based upon his own imagination that "assessee is living along with his wife and son who is a student" but in reality Assessing Authority has never asked about area of residence of Asse .....

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mation on file which proves that estimated drawings taken by the AO are adequate and made addition towards inadequate drawings which is bad in law. Reliance has been placed upon Judgment held by ITAT Chennai in case of Jt. Commissioner of Income Tax, Central Circle IV(1) 46, Chennai Versus Shri V. Sampath -2012(12) TMI 638. Copy of Judgment is enclosed herewith. e. Assessing Officer has not made head wise calculation of assessee's drawings along with drawings made by his family members and m .....

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expenses on the basis of suspicion and surmises is bad in law and Assessing Officer has not given any cogent reason for estimating the household expenses and made impugned addition which may kindly be deleted. Reliance has been placed on decision held by Income Tax Appellate Tribunal-Delhi 94 TTJ 1071 in case of Bajrang Lal Bansal Vs Deputy Commissioner of Income Tax. h. Assessing Officer has made estimated addition on the basis status of assessee which is totally unjustified. Reliance has been .....

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ainly not a leap in the dark. The Assessing Officer is not entitled to make a guess without evidence. An assessment based on mere conjecture, surmise or suspicion or irrelevant and inadmissible evidence and material is in valid and unsustainable in law. Hence, the unjustified addition may kindly be deleted. 9. The ld. CIT(A) after considering the submissions of the assessee sustained the addition by observing as under: The submissions made by the appellant and the AO's report dated 14.7.2014 .....

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own expenses did not exceed ₹ 4,000/- to ₹ 5,000/- p.m. for his household expenses. What is extraordinary is the fact that all these explanations were not preferred to the AO during the assessment proceedings. In fact in the details of cash flow received during the year, it is seen that the appellant received ₹ 1,25,000/- in a family settlement dated 28.01.2011 following his mother's demise on 23.01.2011. This amount has been received at the fag end of the financial year a .....

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horities below and further submitted that the assessee was having the sufficient cash to meet out the household expenses and in making the deposit to his PPF account. Therefore, the addition made by the AO and sustained by the ld. CIT(A) was not justified. 11. In his rival submissions the ld. DR reiterated the observations made by the AO and the ld. CIT(A) strongly supported the impugned order passed by the ld. CIT(A). 12. I have considered the submissions of both the parties and carefully gone .....

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