Sh Umrao Singh HUF, Delhi V. ITO, New Delhi

CO 412/DEL/2012

• Counselvise Citation: [2013] 122 COUNSELVISE.COM (IT) 8920 (ITAT-DELHI)
• Duration Of Justice: 9 month(s) 25 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 14-08-2013
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: H
• Next Hearing Date: 12-08-2013
• Assessment Year: 2006-2007
• Appeal Filed On: 19-10-2012
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: RAMESH CHAND
• Assessee Lawyers: SAMEER SHARMA
• Keywords: Additional evidence; Assessment record
• Section: 131; 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH H NEW DELHI BEFORE SHRI R.P. TOLANI AND SHRI B.C. MEENA ITA NO. 4578/DEL/2012 ASSTT. YR: 2006-07 INCOME-TAX OFFICER, VS. UMRAO SINGH HUF, WARD 25(1), NEW DELHI. PLOT NO. 87, BLOCK H-4/5, PITAMPURA, DELHI-110034. PAN: AAAHU 0205 M AND C.O. NO. 412/DEL/2012 ( IN ITA NO. 4578/DEL/2012 ) ASSTT. YR: 2006-07 UMRAO SINGH HUF, VS. INCOME-TAX OFFICER, PLOT NO. 87, BLOCK H-4/5, WARD 25(1), NEW DELHI. PITAMPURA, DELHI-110034. ( APPELLANT ) ( RESPONDENT ) DEPARTMENT BY : SHRI RAMESH CHAND FCA ASSESSEE BY : SHRI SAMEER SHARMA SR. DR O R D E R PER R.P. TOLANI, J.M : THIS IS REVENUES APPEAL AND ASSESSEES CROSS OBJE CTION AGAINST CIT(A)S ORDER DATED 15-6-2012 RELATING TO A.Y. 200 6-07. RESPECTIVE EFFECTIVE GROUNDS RAISED ARE AS UNDER: REVENUES APPEAL (ITA NO. 4578/DEL/2012) : ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE C IT(A) ERRED IN DELETING THE ADDITION OF RS. 13,20,000/- MADE U/ S 68 OF THE I.T. ACT. 2 ASSESSEES CROSS-OBJECTION : THE LD CIT (APPEALS) IS RIGHT IN DELETING THE ADDIT ION OF RS. 13,20,000/- ON THE FACTS OF THE CASE AS SUFFICIENT OPPORTUNITY HAS BEEN GIVEN TO THE L. ITO TO PROVE OTHERWISE EVEN AT APPELLATE STAGE BY ASKING FOR THE REMAND REPORT TWICE. 2. BRIEF FACTS ARE: THE ASSESSEE FILED ITS RETURN D ECLARING AN INCOME OF RS. 4,08,730/-. IT WAS SELECTED FOR SCRUTINY AND N OTICE U/S 143(2) WAS ISSUED. ASSESSING OFFICER RECEIVED AIR INFORMATION THAT IT HAD DEPOSITED AN AMOUNT OF RS. 13,20,000/- IN HDFC BANK A/C. FOR ITS VERIFI CATION THE ASSESSING OFFICER ISSUED QUESTIONNAIRE. IN REPLY THE ASSESSEE HUF SUBMITTED THAT IT HAD ANCESTRAL PROPERTY AT VILLAGE SULTANPUR MAJRA, WHIC H WAS DIVIDED INTO PLOTS AND AGREED TO BE SOLD TO 12 DIFFERENT PERSONS FROM WHOM ADVANCE OF RS. ONE LAKH EACH WAS RECEIVED. THE ASSESSING OFFICER ISSU ED SUMMONS U/S 131 ON FIVE PERSONS OUT OF THE NAMES OF 12 FURNISHED BY AS SESSEE. ACCORDING TO ASSESSING OFFICER NONE ATTENDED. ASSESSEE WAS THEN ASKED TO PRODUCE THE DOCUMENTARY EVIDENCE. THE ASSESSEE FILED CONFIRMATI ONS FROM FIVE PERSONS TO WHOM SUMMONS WERE ISSUED, CONFIRMING THAT THEY H AD PAID RS. ONE LAKH EACH IN CASH TO THE ASSESSEE AGAINST THE PURCHASE O F PLOT. THEY ALSO EXPLAINED THE SOURCE OF THEIR INVESTMENT IN PLOTS BEING OUT O F THEIR SAVINGS. ASSESSING OFFICER, HOWEVER, HELD THAT THE ASSESSEE HAD NOT GI VEN SATISFACTORY EXPLANATION AND ADDED THE AMOUNT IN THE HANDS OF TH E ASSESSEE U/S 68. 3 2.1. AGGRIEVED, ASSESSEE PREFERRED FIRST APPEAL, DU RING THE COURSE OF HEARING THE ASSESSEE FILED APPLICATION FOR ADMISSIO N OF ADDITIONAL EVIDENCE UNDER RULE 46A, BY WHICH COPIES OF AGREEMENTS/ GPA DRAWN IN FAVOUR OF THE BUYERS AND OTHER EVIDENCE REGARDING FINAL SALE OF T HESE PLOTS TO THESE BUYERS. ASSESSEE ALSO SUBMITTED COPIES OF BANK ACCOUNTS AND FORM NO. 16 OF ONE OF THE PURCHASERS SHRI JAGMOHAN; STATEMENT OF AFFAIRS FOR ASSESSMENT YEARS 2005-06 AND 2006-07 WERE ALSO FILED. 2.2. THE CIT(A) CALLED FOR A REMAND REPORT FROM THE ASSESSING OFFICER. IN HIS REMAND REPORT THE ASSESSING OFFICER OBJECTED FO R ADMISSION OF ADDITIONAL EVIDENCE AT APPELLATE STAGE ON THE GROUND THAT SUF FICIENT OPPORTUNITY WAS PROVIDED TO THE ASSESSEE TO SUBMIT SUCH EVIDENCES A T THE ASSESSMENT STAGE. THE CIT(A) AGAIN ISSUED DIRECTIONS U/S 250(4) OF TH E ACT DIRECTING THE ASSESSING OFFICER TO ISSUE SUMMONS TO THE PURCHASER S OF THE PROPERTY U/S 131 AND CARRY OUT NECESSARY INVESTIGATION BY RECORDING THE STATEMENTS AND TO MAKE OTHER INQUIRIES AND AGAIN SUBMIT A REMAND REPO RT. SECOND REMAND REPORT WAS SUBMITTED BY THE ASSESSING OFFICER WHICH IS MENTIONED IN THE CIT(A)S ORDER. THE CIT(A) DELETED THE ADDITION BY FOLLOWING OBSERVATIONS: 4.6 I HAVE CAREFULLY PERUSED THE REMAND REPORTS OF THE AO AS WELL AS THE SUBMISSIONS MADE BY THE APPELLANT ALONG WITH REJOINDERS ON THE REMAND REPORTS. I HAVE CAREFULLY GONE THROUGH THE ASSESSMENT RECORDS ALSO. FIRSTLY, I AM OF THE OPINION THAT THE ADDITIONAL EVIDENCE SUBMITTED BY T HE APPELLANT 4 DESERVES TO BE ADMITTED SINCE, IT IS CRUCIAL FOR PR OPER DISPENSATION OF JUSTICE IN THIS CASE AND IT IS ALSO CRUCIAL TO THE GROUNDS OF APPEAL TAKEN BY THE APPELLANT. THE AVERM ENT OF THE APPELLANT THAT THERE WAS SUFFICIENT CAUSE FOR NOT P RODUCING THESE EVIDENCES DURING ASSESSMENT STAGE SINCE, THE DEALS GOT FINALIZED MUCH LATER, IS ACCEPTED. THE AD DITIONAL EVIDENCE, IS, THEREFORE, ALLOWED TO BE ADMITTED. 4.7 CERTAIN FINDING OF FACTS IN THIS CASE NEEDS TO BE ELABORATED. (I) THE EXISTENCE OF LAND WHICH IS SOLD HAS NOT BE EN QUESTIONED BY THE AO. THE PROOF OF LAND HOLDING HAS BEEN PROVIDED BY THE APPELLANT IN THE FORM OF KHASRA/ KH ATAUNI. (II) THE AGREEMENTS WITH THE BUYERS ALONG WITH BAY ANA RECEIPTS WERE PRODUCED BY / THE APPELLANT BEFORE TH E AO AND ARE KEPT IN THE ASSESSMENT FOLDER. (III) THE IDENTITY PROOFS OF THE BUYERS ALONG WITH VOTER IDENTITY CARDS/RATION CARDS/DRIVING LICENSE WERE ALSO PROVID ED BY THE APPELLANT TO THE AO AND THESE PROOFS ARE ALSO PLACE D IN THE ASSESSMENT FOLDER. (IV) THE SUMMONS ISSUED BY THE AO WERE SERVED ON MO ST OF THE PURCHASERS AND TWO OF THEM RESPONDED TO THE SUMMONS ALSO. (V) ALL THE PURCHASERS HAVE GIVEN CONFIRMATIONS TH AT CASH WAS GIVEN BY THEM TO THE APPELLANT @ RS.L LAC EACH FOR PURCHASE OF PLOTS (VI) AS REGARDS THE DEPOSIT OFRS.L,20,0001- BY THE APPELLANT IN HIS BANK ACCOUNT OUT OF ITS OWN SOURCES, THE AO APP EARS TO HAVE ACCEPTED THE SAME SINCE, HE HAS NOT COMMENTED ADVER SELY ON THIS ISSUE. 4.7 AFTER CAREFUL ANALYSIS OF ALL THE EVIDENCES AVA ILABLE ON RECORD IN THE ASSESSMENT FOLDER AS WELL AS THOSE SU BMITTED BY THE APPELLANT DURING APPELLATE PROCEEDINGS, I AM OF THE OPINION THAT THE APPELLANT HAS DISCHARGED ITS ONUS ADEQUATE LY WITH REGARDS TO EXPLAINING THE SOURCE OF CASH DEPOSITED IN ITS BANK 5 ACCOUNT. ON THE OTHER HAND, THE AO HAS NOT BEEN ABL E TO BRING ON RECORD ANY SHRED OF EVIDENCE WHICH WOULD PROVE T HAT THE CLAIM OF THE APPELLANT WAS NOT CORRECT. THE ADDITIO N OF RS.13 .20 LACS TO THE INCOME OF THE APPELLANT HAS BEEN IM PUGNED BY THE APPELLANT IN GROUND OF APPEAL NO. 2 AND IN THE LIGHT OF THE DISCUSSION IN THE FOREGOING PARAGRAPHS, THIS ADDITI ON IS DELETED AND THE GROUND OF APPEAL TAKEN BY THE APPELLANT IS ALLOWED . AGGRIEVD, REVENUE IS IN APPEAL AND ASSESSEE HAS FIL ED CROSS OBJECTIONS. 3. LD. DR SUPPORTS THE ORDER OF ASSESSING OFFICER A ND CONTENDS THAT NEITHER BEFORE ASSESSING OFFICER NOR BEFORE THE CIT (A) THE ASSESSEE COULD PRODUCE THE ALLEGED PURCHASERS OF THE PLOTS, THEREF ORE, THE ASSESSEE HAS FAILED TO DISCHARGE ITS BURDEN IN TERMS OF SEC. 68. ORDER OF ASSESSING OFFICER IS RELIED ON. 4. ON THE OTHER HAND, LD. COUNSEL FOR THE ASSESSEE SHRI RAMESH CHAND FCA CONTENDS THAT FROM THE PERUSAL OF CIT(A)S ORDE R FOLLOWING FACTS EMERGE: (A) THERE IS NO DISPUTE ON THE EXISTENCE OF LAND OR THE SUBJECT WHICH WE SOLD AND EVEN THE AO ACCEPTED THE EXISTENC E OF LAND IN QUESTION. (B) THERE IS NO DISPUTE THAT THE AGREEMENTS WITH TH E BUYERS WERE SUBMITTED AT THE TIME OF ASSESSMENT AND ALLEGATIONS THAT THE DOCUMENTS ARE FABRICATED DOES NOT HOLD GROUND. ( C) THERE IS NO DISPUTE TO THE FACT THAT THE DEAL S WERE FINALIZED. (D) THAT THE CONFIRMATIONS FROM THE BUYERS ALONG W ITH IDENTITY AND ADDRESS PROOFS WERE SUBMITTED. ( E) THAT ALL THE SUMMONS U/S. 131 WAS DULY SERVED ON ALL THE 6 BUYERS THEREBY ESTABLISHING THAT THE PERSONS, ADDRE SSES WERE CORRECT AND THE TRANSACTIONS ARE GENUINE. (F) THAT THESE TRANSACTIONS ARE THE SALE TRANSACTI ONS AND THE SELLER IS NOT EXPECTED TO KNOW THE SOURCE OF INCOME OR BANK ACCOUNTS OF THE PERSONS/BUYERS. (G) THAT IT IS ALSO NOT A CASE OF REVENUE THAT THE LAND IN QUESTION WHICH HAS BEEN CLAIMED TO BE SOLD, HAS NOT BEEN ALIENATED BY THE ASSESSEE. (I) THAT THE DOCUMENTS HAVE BEEN COMPLETED IN APRI L, 2010 WITH THE SAME BUYERS AND AS THE LAND IN QUESTION IS AGRICULTURAL LAND AND CANNOT BE REGISTERED IN SMALL PLOTS AND HE NCE POA IS ONLY WAY TO TRANSFER. (J) THAT THERE IS NO MENTION IN THE REMAND REPORT ABOUT THE DEPOSIT OF RS. 1,20,000/- FROM OUR OWN SOURCE. 4.1. IT WAS PLEADED THAT THE ASSESSEE SUBMITTED THA T VARIOUS DOCUMENTS IN THE FORM OF AGREEMENTS, WHICH ARE SUPPORTED BY SUBS EQUENT SALE-DEEDS. THESE DOCUMENTS ARE SUFFICIENT TO PROVE THAT THE TR ANSACTIONS IN QUESTION WERE GENUINE AND THE PLOTS WERE ACTUALLY AGREED TO BE SOLD, ADVANCE OF RS. ONE LAC EACH WAS RECEIVED AND THEREAFTER SOLD. THE REFORE, THE FACTUM OF ASSESSEE HAVING RECEIVED ADVANCES FOR PURCHASE OF P LOTS IS CLEARLY DEMONSTRATED. 4.2. THE ASSESSING OFFICER INSISTED ON PHYSICAL PRO DUCTION OF THE PERSONS WHICH WAS BEYOND THE CAPACITY OF THE ASSESSEE AS T HE ORDINARILY PERSONS ARE NOT INCLINED TO APPEAR BEFORE THE INCOME-TAX AUTHOR ITIES. FOR THEIR NON- ATTENDANCE ASSESSEE CANNOT BE HELD RESPONSIBLE. REL IANCE IS PLACED ON 7 HONBLE SUPREME COURT JUDGMENT IN THE CASE OF ORIS SA CORPORATION 159 ITR 78 FOR THE PROPOSITION THAT IF SUMMONS U/S 131 ARE ISSUED AND NOT RESPONDED BY THE PERSONS SUMMONED, NO ADVERSE INFER ENCE CAN BE DRAWN AGAINST THE ASSESSEE. IT IS FOR THE ASSESSING OFFIC ER TO BRING THE PROCEEDINGS OF 131 TO A LOGICAL CONCLUSION. IN THIS CASE FROM THE MATERIAL AVAILABLE ON RECORD, ASSESSEE HAS BEEN ABLE TO DEMONSTRATE CLEAR LY THAT IT RECEIVED THE ABOVE AMOUNTS BY WAY OF ADVANCES AND THE PLOTS WERE ULTIMATELY SOLD. ONCE THE ASSESSEE HAS PRODUCED SUFFICIENT EVIDENCE TO CO RROBORATE ITS VERSION, THE NON-ATTENDANCE OF PERSONS WHICH IS NOT IN ITS CONTR OL DOES NOT MILITATE AGAINST THE ASSESSEES STAND. 5. WE HAVE HEARD RIVAL SUBMISSIONS AND GONE THROUGH THE ENTIRE MATERIAL AVAILABLE ON RECORD. AS THE FACTS EMERGE, THE ISSUE BEFORE US IS WEIGHING OF THE EVIDENCE AVAILABLE ON RECORD. THE ASSESSEE PROD UCED AGREEMENTS FOR PURCHASE OF PLOT AND ADVANCES RECEIVED FROM THE PUR CHASERS; THE AGREEMENTS ARE CORROBORATED BY SUBSEQUENT SALE-DEEDS, WHICH WE RE PRODUCED AS ADDITIONAL EVIDENCE BEFORE THE CIT(A) ON WHICH TWO REMAND REPORTS WERE CALLED. REVENUE IS NOT IN APPEAL AGAINST THE ADMISS ION OF ADDITIONAL EVIDENCE. 5.1. DESPITE THIS CORROBORATING EVIDENCE, ASSESSING OFFICER WANTED PHYSICAL PRESENCE OF THE BUYERS WHICH THE ASSESSEE COULD NOT COMPLY. ASSESSING OFFICER ISSUED SUMMONS U/S 131 WHICH ARE NOT SATISF ACTORILY COMPLIED WITH. 8 ASSESSING OFFICER DID NOT PROCEED FURTHER QUA THE N ON-COMPLIANCE OF SUMMONS U/S 131 AGAINST THE PERSONS SUMMONED IN TER MS OF HONBLE SUPREME COURTS OBSERVATIONS CONTAINED IN THE CASE OF ORISSA CORPORATION (SUPRA). THE MAIN ISSUE IS NOW TO ASCERTAIN WHETHER THE EVIDENCE FILED BY THE ASSESSEE IS SUFFICIENT TO COME TO A CONCLUSION THAT THE ASSESSEE HAS DISCHARGED THE BURDEN IN TERMS OF INGREDIENTS OF SE CTION 68 I.E. IDENTITY, CREDITWORTHINESS AND GENUINENESS OF PERSONS TRANSAC TED. IN OUR CONSIDERED VIEW THE FACT THAT THE REGISTERED SALE-DEEDS WERE P RODUCED WHICH CORROBORATE THE AGREEMENTS FOR SALE AND SUPPORT THE RECEIPT OF ADVANCES AND THE IDENTITY OF PERSONS AND ASSESSEE HAS DISCHARGED ITS PRIMARY ONUS CAST IN TERMS OF SEC. 68. CONSIDERING ALL THE FACTS AND CIRCUMSTANCES, WE SEE NO INFIRMITY IN THE ORDER OF CIT(A) DELETING THE ADDITION IN QUESTION. THE ORDER OF CIT(A) IS ACCORDINGLY UPHELD. REVENUES APPEAL IS DISMISSED. 6. ASSESSEES CROSS-OBJECTION BEING MERELY IN SUPPO RT OF THE CIT(A)S ORDER HAS BECOME INFRUCTUOUS AND STANDS DISMISSED A CCORDINGLY. 7. IN THE RESULT, REVENUES APPEAL AS WELL AS SASSE SSEES CROSS OBJECTION STAND DISMISSED. ORDER PRONOUNCED IN OPEN COURT ON 14-08-2013. SD/- SD/- ( B.C. MEENA ) ( R.P. TOLANI ) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 14 TH AUGUST 2013. MP COPY TO : 1. ASSESSEE 2. AO 3. CIT 4. CIT(A) 5. DR 9