Mrs. Mala Gupta, Kolkata V. ITO,Ward-53(1), Kolkata, Kolkata

CO 28/KOL/2012

• Counselvise Citation: [2015] 123 COUNSELVISE.COM (IT) 1007 (ITAT-KOLKATA)
• Duration Of Justice: 3 year(s) 3 month(s) 24 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 09-07-2015
• Appeal Filed By: Assessee
• Bench Allotted: C
• Assessment Year: 2005-2006
• Appeal Filed On: 15-03-2012
• Court: TRIBUNAL
• Department Lawyers: A P ROY
• Keywords: Capital asset; Gift; Onus to prove
• Section: 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH: KOLKATA [BEFORE SHRI P. K. BANSAL, AM & SHRI MAHAVIR SINGH, JM ] I.T.A NO. 1 6 11 /KOL/201 1 ASSESSMENT YEAR : 200 5 - 0 6 INCOME - TAX OFFICER, WD - 53(1), KOLKATA. VS. SMT. MALA GUPTA (PAN: AHGPG5432N) ( APPELLANT ) ( RESPONDENT ) & C.O. NO.28/KOL/2012 IN I.T.A NO. 1611 /KOL/201 1 ASSESSMENT YEAR : 200 5 - 06 SMT. MALA GUPTA VS. INCOME - TAX OFFICER, WD - 53(1), (CROSS OBJECTOR) (RESPONDENT) DATE OF HEARING: 09 .0 7 .2015 DATE OF PRONOUNCEMENT: 09 . 0 7 . 2015 FOR THE REVENUE : SHRI A. P. ROY, JCIT FOR THE ASSESSEE/CROSS OBJECTOR : SHRI SIDDHARTH JHAJHARIA, FCA ORDER PER SHRI MAHAVIR SINGH, JM: THIS APPEAL BY REVENUE AND CROSS OBJECTION BY ASSESSEE ARE ARISING OUT OF ORDER OF CIT (A) - XXXIII , KOLKATA VIDE APPEAL NO. 159 /CIT(A) - XXXII I / WD - 53(1)KOL/07 - 08 DATED 15 . 0 9 .201 1 . ASSESSMENT WAS FRAMED BY ITO, 53(1) , KOLKATA U/S. 147/ 1 43(3) OF THE INCOME - TAX ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT ) FOR ASSES SMENT YEAR 200 5 - 0 6 VIDE HIS ORDER DATED 3 1 . 12 .20 0 7 . 2. THE FIRST ISSUE IN THIS APPEAL OF REVENUE IS AGAINST THE ORDER OF CIT(A) DELETING THE DISALLOWANCE MADE BY AO IN REGARD TO PERSONAL EFFECT TREATING THE SAME AS ACQUIRED FROM UNDISCLOSED SOURCES OF IN COME. FOR THIS, REVENUE HAS RAISED FOLLOWING GROUND NOS. 1 AND 2: 1 . THAT IN THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) ERRED IN DELETING THE DISALLOWANCE MADE IN REGARD TO PERSONAL EFFECT FROM UNDISCLOSED SOURCES OF RS.10 LAC. 2. THAT IN THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) ERRED IN TREATING SRI BECHAN SINGH AND SRI BECHU SINGH AS SAME PERSON WHERE THE INVESTIGATION PROVED THAT THEY WERE TWO DIFFERENT PERSONS. 2 ITA NO. 1 6 11 /K/201 1 & CO NO.28/K/2012 SMT. MALA GUPTA AY 200 5 - 0 6 3. BRIEFLY STATED FACTS ARE THAT THE ASSESSEE CLAIMED A SU M OF RS.10 LAC AS RECEIPT SHOWN FROM SALE OF PERSONAL EFFECT ACQUIRED FROM ANCESTRAL PROPERTY JOINTLY HELD WITH HER SISTER. THE PROPERTY FROM WHERE THE PERSONAL EFFECTS WERE SOLD WAS ALSO SOLD FOR A CONSIDERATION OF RS. 60 LAC. ON THE SAME DAY FITTING, F IXTURE AND FURNITURE AS AVAILABLE IN THAT PROPERTY WAS ALSO SOLD TO ONE SHRI BECHAN SINGH FOR A CONSIDERATION OF RS.20 LACS THAT MEANS RS. 10 LACS SHARE COMES TO ASSESSEE. THE ASSESSEE CLAIMED THIS AS AN EXEMPT BEING TRANSFER OF PERSONAL EFFECT AS CAPITAL ASSET IN VIEW OF SECTION 2 (14)(II) OF THE ACT. THE AO HELD THAT THE AMOUNT RECEIVED ON SALE OF PERSONAL EFFECT IS BOGUS AND TREATED THIS RECEIPT OF RS.10 LACS AS UNDISCLOSED INCOME OF THE ASSESSEE U/S. 68 OF THE ACT. AGGRIEVED, ASSESSEE PREFERRED APPEAL BEFORE CIT(A), WHO DELETED THE ADDITION BY OBSERVING IN PARA 8 AS UNDER: 8. AFTER CONSIDERING THE FACTS AND CIRCUMSTANCES, I AM OF THE VIEW THAT THERE IS ENOUGH CIRCUMSTANTIAL EVIDENCE TO SUPPORT THE APPELLANT'S CASE. AN AGREEMENT FOR SALE OF FITTING, F IXTURES AND FURNITURE WAS SIGNED ON THE VERY DATE ON WHICH AGREEMENT FOR SALE OF PROPERTY WAS SIGNED. THE AGREEMENT CLEARLY MENTIONED THE ITEMS SOLD ARE FITTINGS, FURNITURE AND FIXTURES INSTALLED/PROVIDED IN THE PROPERTY. THE SALE CONSIDERATION HAS BEEN RE CEIVED THROUGH BANKING CHANNEL. THE BANK TRANSACTION WAS INDEPENDENTLY CONFIRMED BY THE ASSESSING OFFICER. IN VIEW OF THIS PRIMA FACIE MATERIAL, IF ASSESSING OFFICER WAS NOT SATISFIED THAT THE AMOUNT RECEIVED WAS NOT ON ACCOUNT OF SALE OF FURNITURE AND FIX TURE, ONUS WAS UPON HIM TO BRING ANY MATERIAL EVIDENCE TO THE CONTRARY. HOWEVER NO STRONG EVIDENCE HAVE BEEN BROUGHT ON RECORDS. TRUE, THERE IS A SLIGHT DISCREPANCY IN NAME OF THE PURCHASER AS MENTIONED IN THE AGREEMENT AND AS PER THE BANK RECORD. HOWEVER THE SLIGHT DIFFERENCE BETWEEN 'BECHU' AND 'BECHAN' IS NOT OF MATERIAL IMPORTANCE CONSIDERING THE NAME OF FATHER IS MATCHING. IN ALL PROBABILITY 'BACHU' AND 'BECHAN' ARE VARIATIONS OF SAME PERSON'S NAME. ALSO IF THE SAID PERSON SHIFTED HIS PREMISES, THE APP ELLANT CANNOT BE REASONABLY EXPECTED TO KEEP TRACK IN CASE OF SUCH ONE TIME, TRANSACTION. ENQUIRY CONDUCTED BY THE INVESTIGATION WING HAS FAILED TO LOCATE SRI BECHAN SINGH BUT HAS ALSO NOT RESULTED IN ANY POSITIVE EVIDENCE AGAINST THE APPELLANT BECAUSE THE INSPECTOR HAS REPORTED THAT THE GIVEN ADDRESS WAS OF A BIG BLOCK HAVING MOSTLY TENANTS. UNDER THESE CIRCUMSTANCES, SRI BECHAN SINGH BEING ONE OF TENANT AT EARLIER POINT OF TIME CANNOT BE RULED OUT. IN VIEW OF THOSE FACTS, I AM OF THE OPINION THAT THERE IS NO EVIDENCE TO REFUTE THE APPELLANT'S CLAIM THAT THE AMOUNT OF RS. 10 LA C S WAS RECEIVED ON SALE OF PERSONAL EFFECTS BEING FURNITURE AND FIXTURE. THE ADDITION IN THIS RESPECT IS ACCORDINGLY DELETED. AGGRIEVED, REVENUE IS IN APPEAL BEFORE TRIBUNAL 4. WE H AVE HEARD RIVAL SUBMISSIONS AND GONE THROUGH FACTS AND CIRCUMSTANCES OF THE CASE. THE UNDISPUTED FACTS ARE FACT THAT THE ANCESTOR PROPERTY OF THE APPELLANT MEASURING 320 SQ. YARDS WAS SOLD BY AGREEMENT DATED 01 - 06 - 2004. ON THE SAME DATE ANOTHER AGREEMENT WAS SIGNED WITH SRI BECHAN SINGH FOR SALE OF FITTING, FIXTURE 3 ITA NO. 1 6 11 /K/201 1 & CO NO.28/K/2012 SMT. MALA GUPTA AY 200 5 - 0 6 AND FURNITURE INSTALLED IN THE SAID PROPERTY. CONSIDERATION FOR THE SAME WAS RECEIVED BY PAY ORDER. ON MAKING ENQUIRY FROM BANK THE TRANSACTION WAS CONFIRMED EXCEPT TO THE EXTENT THAT NAME OF TH E CONCERNED AMOUNT HOLDER WAS FOUND TO BE SRI BECHU SINGH. WE ALSO FIND FROM THE CASE RECORDS THAT THE ASSESSING OFFICER HAD RECEIVED FROM UCO B ANK, NIJAMUDDIN (BRANCH) NEW DELHI A LETTER DATED 29 - 11 - 2007 THAT NAME OF SRI BACHU SINGH'S FATHER WAS SRI DAL SINGHAR SINGH, WHICH MATCHES WITH THE NAME OF FATHER OF SRI BECHAN SINGH, AS MENTIONED IN THE SALE AGREEMENT. THEREFORE THERE IS FORCE IN ARGUMENT OF THE A SSESSEE THAT THE SLIGHT DIFFERENCE IN NAMES DOES NOT MEAN THAT THEY ARE NOT BELONGING TO THE SAME PER SON. ALSO THE A SSESSEE 'S STATEMENT THAT FURNITURE AND FIXTURE CONSISTED OF A LARGE NUMBER OF AN TIQUE, BULKY AND UNIQUE PIECES WHICH IS WHY THEIR DESCRIPTION WAS NOT MENTIONED IN THE SALE AGREEMENT ALSO CANNOT BE DISMISSED SUMMARILY. SO FAR AS NON - PRODUCTIO N OF SRI BECHAN SINGH IS CONCERNED, IT HAS BEEN EXPLAINED THAT THIS WAS ONE TIME TRANSACTION WITH HIM AND THEY WERE NOT IN CONTINUOUS TOUCH. THEREFORE THE A SSESSEE WAS NOT AWARE OF HIS CURRENT WHEREABOUTS. HOWEVER THIS SHOULD NOT BE HELD AGAINST A SSESSEE , SINCE THE PERSON GENUINELY EXISTED AS ALSO CLEAR FROM THE BANK ENQUIRY MADE BY THE AO . IN VIEW OF THE ABOVE, WE ARE OF THE VIEW THAT THE ASSESSEE IS ABLE TO PROVE THAT THE PURCHASE BECHAN SINGH IS THE SAME PERSON WHO HAS PURCHASED THE FURNITURE AND FIXTURE S CONSISTED OF A NUMBER OF ANTIQUE, BULKY AND UNIQUE PIECES. THE GENUINENESS OF TRANSACTION IS NOT IN DOUBT. IN VIEW OF THIS, WE CONFIRM THE ORDER OF CIT(A) AND THIS ISSUE OF REVENUE S APPEAL IS DISMISSED. 5. THE NEXT ISSUE IN THIS APPEAL OF REVENUE IS AGAINST THE ORDER OF CIT(A) DELETING THE ADDITION OF GIFT MADE BY AO FOR THE REASON THAT THE GENUINENESS OF GIFT AND CAPACITY FOR MAKING GIFT IS NOT PROVED AMOUNTING TO RS.17 LACS. FOR THIS REVENUE HAS RAISED FOLLOWING GROUND NO.3: 3. THAT IN THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) ERRED IN DELETING THE DISALLOWANCE OF GIFTS OF RS. 17 LACS WHERE THE ASSESSEE FAILED TO PROVE THE GENUINENESS OF THE GIFTS AND ONUS TO PROVE THE CAPACITY OF MAKING THE GIFTS. 6. BRIEFLY STATED FACTS ARE THAT T HE ASSESSEE RECEIVED GIFT OF RS. 20 LACS FROM TEN DIFFERENT PERSONS. THE AO DURING THE COURSE OF ASSESSMENT PROCEEDINGS CONDUCTED ENQUIRY AND FOUND THAT NEITHER GENUINENESS NOR CAPACITY OF DONORS ARE PROVED AND 4 ITA NO. 1 6 11 /K/201 1 & CO NO.28/K/2012 SMT. MALA GUPTA AY 200 5 - 0 6 HENCE, HE ADDED THESE GIFTS AS UNEXPLAINED U/ S. 68 OF THE ACT. AGGRIEVED, ASSESSEE PREFERRED APPEAL BEFORE CIT(A), WHO AFTER CONSIDERING THE SUBMISSION OF THE ASSESSEE DELETED THE ADDITION BY OBSERVING IN PARA 11 TO 15 AS UNDER: 15. SO FAR AS OTHER GIFT ARE CONCERNED, IT IS SEEN THAT APPELLANT HAD GIVEN DOCUMENTS SUCH AS AFFIDAVITS SUPPORTED IN MOST CASES BY ACKNOWLEDGEMENT OF RETURN, BALANCE SHEET, EXTRACT FROM BANK ACCOUNT ETC. ALL BUT ONE OF THE DONORS ARE HAVING PAN. THUS THE PRIMARY ONUS WAS INITIALLY DISCHARGED BY THE APPELLANT. IT IS SEEN FR OM THE CASE RECORDS THAT VIDE ORDER SHEET ENTRY DATED 13 - 09 - 2007 THE ASSESSING OFFICER ASKED THE APPELLANT TO PRODUCE THE DONORS. WHEN THE DONORS WERE NOT PRODUCED WITHIN THE TIME GIVEN, THE A.O ISSUED SUMMONS TO THE DONORS. IN RESPONSE, TWO DONORS VIZ. SM T. PINNU AGARWAL AND SMT. SARITA JHUNJHUNWALA HAD APPEARED. SO FAR AS OTHER DONORS ARE CONCERNED IT IS SEEN THAT WRITTEN REPLIES HAVE BEEN RECEIVED BY THE ASSESSING OFFICER IN CASE OF SRI HEMANT PODDAR, SANKAR PODDAR (ON BEHALF OF LATE BHUSAN PODDAR) SAFA HUSSAIN AND SAJJAD HUSSA I N. TWO OF THE OTHER DONORS VIZ SRI SATYANARAYAN MALL AND SRI RADHESHYAM AGARWAL ARE STATED TO BE DECEASED. THUS THE ONLY DONORS WHOSE REPLIES ARE NOT ON RECORDS OF ASSESSING OFFICER ARE SMT. GITA DEVI AGARWAL AND SMT. SHANTI DEVI M ALL. IN C ASE OF SMT GITA DEVI AGARWAL THE ADDITION HAS ALREADY BEEN CONFIRMED AS DISCUSSED IN PARA 14 ABOVE. SO FAR AS SMT. SHANTI DEVI MALL IS CONCERNED THERE IS NO EVIDENCE ON RECORD THAT SUMMON ISSUED TO HER WAS ACTUALLY SERVED AS THE ACKNOWLEDGEMENT ON RECORD IS NOT SIGNED BY ANYBODY UNLIKE ACKNOWLEDGMENT IN CASE OF OTHER DONORS . THUS, IT CAN BE SEEN THAT IN THE ABOVE CASE S WHEN THE DONORS WERE NOT PRODUCED BY THE APPELLANT, THE ASSESSING OFFICER ISSUED SUMMONS TO THEM. THE SUMMON WHICH WERE SERVED HAS BEEN COMPLIED WITH (EXCEPT IN CASE OF SMT. GITA DEVI AGARWAL). THE REPLIES RECEIVED BY THE ASSESSING OFFICER ARE IN ALMOST ALL CASES ACCOMPANIED BY THE DETAILS OF PAN AND SUPPORTING DOCUMENTS SUCH AS COPY OF RETURN OF INCOME, BALANCE SHEET EXTRACT FROM BANK ACCOUNT ETC. CONSIDERING THESE FACTS, IN MY OPINION, UNLESS THE ASSESSING OFFICER BRINGS ANY EVIDENCE TO THE CONTRARY, TH E SAID GIFTS CANNOT BE TREATED AS NOT GENUINE. ASSESSING OFFICER WAS NOT RIGHT IN TREATING THE TRANSACTIONS AS NON GENUINE MERELY BECAUSE THE DONORS WERE NOT PRODUCED BY TH E APPELLANT SINCE SUBSEQUENTLY THE DONORS HAVE DIRECTLY RESPONDED TO THE SUMMONS ISS UE BY THE ASSESSING OFFICER AND NO DISCREPANCY IN THE REPLIES HAVE BEEN FOUND BY THE ASSESSING OFFICER NOR ANY FURTHER ENQUIRY HAS BEEN CONDUCTED. AGGRIEVED, NOW REVENUE IS IN APPEAL BEFORE TRIBUNAL. 7. WE HAVE HEARD RIVAL SUBMISSIONS AND GONE THROUGH FA CTS AND CIRCUMSTANCES OF THE CASE. WE FIND THAT THE ASSESSEE IN MOST OF THE CASES HAS FILED ACKNOWLEDGMENT OF RETURNS, BALANCE SHEETS, DETAILS OF BANK ACCOUNTS INCLUDING STATEMENTS AND PAN NOS. OF THE DONORS. THE ASSESSEE IS ABLE TO DISCHARGE THE PRIMARY ONUS AND AO JUST ON THE BASIS OF SURMISES AND CONJECTURES AND WITHOUT ANY ENQUIRY ADDED THESE GIFTS. EVEN THESE DONORS HAVE REPLIED TO THE AO IN ALMOST ALL CASES ACCOMPANIED BY SUPPORTING DOCUMENTS. THE CIT(A) EXACTLY ON SAME FACTS DELETED THE ADDITION. EVEN NOW REVENUE COULD NOT CONTROVERT THE FINDINGS OF 5 ITA NO. 1 6 11 /K/201 1 & CO NO.28/K/2012 SMT. MALA GUPTA AY 200 5 - 0 6 CIT(A) AND NO NEW FACTS WERE ADDED. HENCE, WE HAVE NO ALTERNATIVE EXCEPT TO CONFIRM THE ORDER OF CIT(A) ON THIS ISSUE. WE ORDER ACCORDINGLY. 8. AT THE TIME OF HEARING LD. COUNSEL FOR THE ASSESSEE DID NOT PRESS THE CROSS OBJECTION, HENCE, THE SAME IS DISMISSED BEING NOT PRESSED. 9 . IN THE RESULT, APPEAL OF REVENUE IS DISMISSED AND CO OF ASSESSEE IS ALSO DISMISSED AS NOT PRESSED. 10 . ORDER IS PRONOUNCED IN THE OPEN COURT . SD/ - SD/ - ( P. K. BANSAL ) (MAHAVIR SINGH) ACCOUNTANT MEMBER J UDICIAL MEMBER DATED : 9 TH JULY , 201 5 JD.(SR.P.S.) COPY OF THE ORDER FORWARDED TO: 1 . A PPELLANT ITO, WARD - 53(1), KOLKATA . 2 RESPONDENT SMT. MALA GUPTA, C/O M. K. AGARWAL, 4/7, BHIKARAM CHAND MARKET, 14/2, OLD CHINA BAZAR ST., KOLKATA - 700 001. . 3 . THE CIT (A), KOLKATA 4. 5. CIT, KOLKATA . DR, KOLKATA BENCHES, KOLKATA / TRUE COPY, BY ORDER, ASSTT. REGISTRAR .