DASHRATH KUMAR SHARMA, JPR ,JAIPUR V. ITO WD 7(4), JPR, JAIPUR

ITA 647/JPR/2024

AI Insights

The case involves an appeal by Shri Dashrath Kumar Sharma against the order of the CIT(A) which upheld the additions made by the AO for the assessment year 2014-15. The additions included unexplained cash credits under section 68, and income from other sources under section 56(2)(vii)(b)(ii) due to discrepancies between the declared purchase consideration and the stamp duty value of properties. The Tribunal found that the assessee had not adequately substantiated the agricultural income claimed and that the additions under section 68 were not convincingly explained. However, it directed a re-examination of the addition under section 56(2)(vii)(b)(ii) considering the revised tolerance limit for variations in property valuations.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 472794 (ITAT-JAIPUR)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-03-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2014-2015
• Other Referred Cases: CIT vs. P. Mohan Kala, CIT vs. Taj Borewells, Sheraton Apparels v/s ACIT, Aravali Trading Co. v/s ITO, Amrapali Cinema v/s ACIT, Kolkata Export Company v/s CIT, Allied Motors (P.) Ltd. v. CIT, Andaman Timber Industries v/s CCE, Kolkata-II, Maria Fernandes Cheryl v. ITO, Rajeev Kumar Agarwal v. Addl. CIT, Kantilal & Brothers v/s CIT, Manoj v/s DCIT, Smt. Shanta Devi v/s CIT, ACIT v/s Om Prakash & Co., S.P. Goyal v/s DCIT
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ARVIND KUMAR
• Assessee Lawyers: MAHENDRA GARGIEYA; HEMANG GARGIEYA
• Keywords: Business income; Capital asset; Revised return; Retrospective amendment; Corroborative evidences; Unexplained cash credit; Depreciation; Unexplained investment; Sale consideration of property below Jantri Value; Onus to prove; Gift; Capital Gains; Opportunity of cross examination
• Section: 143(3); 142(1); 143(2); 271(1)(c); 56; 43CA; 139(1); 68; 56(2)(vii)(b); 69; 13; 139; 274; 43B; 50C; 139(4); 44AB; 139(5); 20

Judgement Text

" vk;dj vihyh; vf/kdj.k] t;iqj U;k;ihB] t;iqj IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES,”A” JAIPUR Mk0 ,l- lhrky{eh] U;kf;d lnL; ,oa Jh jkBksM deys'k t;UrHkkbZ] ys[kk lnL; ds le{k BEFORE: DR. S. SEETHALAKSHMI, JM & SHRI RATHOD KAMLESH JAYANTBHAI, AM vk;dj vihy la-@ITA No. 647/JP/2024 fu/kZkj.k o\"kZ@Assessment Year : 2014-15 Shri Dashrath Kumar Sharma 73, Pancholiya Ka Mohalla, Kanota, Jaipur – 303 012 cuke Vs. The ITO Ward 7(4) Jaipur LFkk;h ys[kk la-@thvkbZvkj la-@PAN/GIR No.: EAJPS 0594A vihykFkhZ@Appellant izR;FkhZ@Respondent fu/kZkfjrh dh vksj ls@ Assessee by : Shri Mahendra Gargieya, Advocate & Shri Hemang Gargieya, Advocate jktLo dh vksj ls@ Revenue by : Shri Arvind Kumar, CIT-DR lquokbZ dh rkjh[k@ Date of Hearing : 01/01/2025 mn?kks\"k.kk dh rkjh[k@Date of Pronouncement : 17/03/2025 vkns'k@ ORDER PER: RATHOD KAMLESH JAYANTBHAI, AM By way of the present appeal the assessee challenges the order of the learned National Faceless Appeal Centre [ for short (NFAC)/CIT(A) ] dated 25-04-2024 for the assessment year 2014-15. That order was passed because the assessee challenges the order of the assessment by filling an appeal. The order of the assessment was passed 26.12.2016 by Income Tax Officer, Ward 7(4), Jaipur [ for short AO ] as per provision of section 143(3) of the Income Tax Act [ for short Act ]. 2. In the present appeal the assessee has raised following grounds of appeal : 1. The impugned order u/s 143(3) dated 26.12.2016 is bad in law and on facts of the case, for want of jurisdiction and various other reasons and hence the same kindly be quashed. 2. Rs. 2,56,03,777/- (wrongly typed as Rs.2,58,03,777/-): The ld. CIT (A) erred in law as well as on the facts of the case in confirming the addition made of Rs. 2,56,03,777/- u/s 68 of the Act on account of increase in capital. The impugned addition so made and confirmed, being totally contrary to the provisions of law and facts of the case, kindly be deleted in full. 3. Rs. 15,32,337/-: The ld. CIT(A) erred in law as well as on the facts of the case in confirming the addition made of Rs. 15,32,337/- u/s 56(2)(vii)(b)(i) of the Act alleging that total purchase consideration of the properties is less as compared to the DLC value as income from other sources. The impugned addition so made and confirmed, being totally contrary to the provisions of law and facts of the case, kindly be deleted in full. 4. Rs. 38,76,456/-: The ld. CIT(A) erred in law as well as on the facts of the case in confirming the addition made of Rs. 38,76,456/-on account of agricultural income declared initially ignoring the fact and legal position that the same was declared at NIL in the revised ROI and without bringing any evidence on record to show that there was an undisclosed income, making of the impugned addition and confirmation thereof, being totally contrary to the provisions of law and facts of the case, kindly be deleted in full. 5. The ld. CIT(A) erred in law as well as on the facts of the case in charging interest u/s 234A, 234B, 234C & 234D of the Act. The appellant totally denies it liability of charging of any such interest. The interest, so charged, being contrary to the provisions of law and facts, kindly be deleted in full. 6. The appellant prays your honor to add, amend or alter any of the grounds of the appeal on or before the date of hearing. 3. The brief facts related to the disputes are that the assessee efiled return of income on 30.03.2015 declaring total income of Rs. 2,05,280/- and agricultural income of Rs. 38,76,456/- which was included for rate purposes. The case of was selected for limited scrutiny though CASS. After issuance of notice u/s. 143(2) of the Act on 31.08.2015, the assessee filed revised return of income on 30.03.2016 declaring total income of Rs. 2,05,280/- and Nil agricultural income. Ld. AO noted that the revised return of income filed by the assessee was not a valid return of income as the original return of income was not filed as per the provisions of section 139(1) of the Act and therefore, he considered the revised return of income as a further information filed by the assessee. 3.1 Ld. AO noted that the assessee has shown total fixed assets of Rs. 2,85,69,394/- and current assets of Rs. 6,60,049/- as compared to fixed assets of Rs. 18,60,416/- and current assets of Rs. 17,79,337/- shown in the immediate preceding year. Therefore, there was an addition of Rs. 2,55,89,690 in the fixed assets and currents assets in the year under consideration. Regarding the source in the original return of income assessee claimed secure loan of Rs. 9,74,848/- and unsecured loan of Rs. 1,68,00,000/-, agricultural income of Rs. 38,76,456/- and capital of Rs. 42,44,387/-. Whereas in the revised balance sheet filed during the year under consideration the assessee claimed receipt of gift of Rs. 2,10,00,000/- from his father, unsecured loan of Rs. 18,00,000/-, secured loan of Rs. 6,72,987/- capital of Rs. 47,56,456/- and sundry creditors of Rs. 10,00,000/-. 3.2 Looking to the discrepancies and huge additions in the assets, proposal for conservation of the case from limited to complete scrutiny was made before the Principal Commissioner of Income Tax, III, Jaipur was made on 04.10.2016 by the ld. AO and the same was approved on 10.11.2016. 3.3. The AO issued a summons to Shri Mohan Lal Sharam, from whom the assessee claimed to have obtained a unsecured loan of Rs. 18,00,000/-. His statement was recorded and given a copy to the assessee. The assessee was required to furnish the reply as to why the unsecured loan of Rs. 18,00,000/- may not be treated as his unexplained income in view of the statement of Shri Mohan Lal Sharma. The assessee did not furnish any explanation to the ld. AO. 3.4 Since the assessee remained non-compliant ld. AO proceeded to complete the assessment based on the information available on record and ultimately completed the assessment by making the following addition in the return of income so filed by the assessee: Sr. No. Particulars Amount Rs. 1 Total income as declared in the return of income 2,05,280 2 Addition u/s 68 of the Act on account of increase in capital 2,56,03,0777 3 Addition on account of business income 17,24,000 4 Unexplained unsecure loan 18,00,000 5 Unexplained sundry creditors 10,00,000 6 Addition as per provision of section 56(2)(vii)(b)(ii) of the Act 15,32,337 7 Income from other sources 38,76,456 Total assessed income 3,57,41,850 4. Aggrieved from the above order of the assessment the assessee preferred an appeal before the ld. CIT(A). Apropos to the various grounds of appeal so raised by the assessee the relevant finding of the ld. CIT(A) is reiterated here below: ‘’4. Decision Ground No. 1:- This ground is general in nature and does not require any adjudication. Ground No.2: The ground of appeal has been raised on account of addition of Rs.2,56,03,777/- by the Ld.AO u/s 68 of the Act. From the facts of the case, it is seen that the limited scrutiny of the assessee was converted into a full scrutiny case on account of various discrepancies observed in the submissions and the ITR of the assessee It is seen that the appellant had filed his original return of income on 30.03.2015 declaring total income of Rs.2,05,280/- and an agricultural income of Rs.38,76,456/- for rate purposes. However, after the case of the assessee was selected for scrutiny, he preferred to revise his return of income on 30.03.2016 hence declaring total income of Rs.2,05,280/- and Nil agricultural income. The appellant has not raised any ground of appeal for considering his revised return as the true and correct statement of affairs. Since, the Ld. AO had treated the revised return just has an information filed by the assessee, the adjudication of this appeal is being done by considering the facts as stated in the original ITR of the assessee/appellant. During the course of assessment proceedings, the Ld. AO had observed that the assessee has shown an increase of capital of Rs.2,56,03,777/- in his capital account as on 31.03.2014. The appellant justified the source of increase of his capital on account of receipt of a gift of Rs.1,50,00,000/- from his late father Sh. Kalyan Sahay Sharma on 13.06.2013 (as shown in the revised ITR). The Ld. AO added a sum of Rs.2,56,03,777/- as unexplained cash credits u/s 68 to the income of the assessee. During the course of appellate proceedings, the appellant has provided the details of the sources of the cash credits as gifts received from his father- Rs.25,00,000/- (during A.Y. 2013-14) and Rs.27,00,000/- (during A.Y.2014-15) respectively, a gift of Rs.11,00,000/- from his wife, during A.Y. 2013-14 and a gift of Rs.5,00,000/- from his natural father (during Α.Υ.2013-14). Further, the appellant has stated that he has received unsecured loans amounting to Rs. 18,00,000 from Sh. Mohan Lal Sharma and another unsecured loan amounting to Rs.5,18,800/- from various parties. An advance against land situated at Kishanpura was also received amounting to Rs. 18,00,000/- Hence, the details of total cash credits amounting to Rs.1,09,18,800/- only have been provided by the appellant out of the total addition of Rs.2,56,03,777/- The appellant has attached various confirmations and gift deeds to support his arguments. The submissions of the appellant have been perused. It is seen that the appellant had at the time of assessment proceedings only stated to have received Rs.1,50,00,000/- from his late father as the source of the purchase of capital assets. Now, he has changed his submissions and has given cash credits to have been received as gifts from his blood relatives, acquaintances and through unsecured loans. Hence, the submission of the appellant are not only diverging but are totally unconvincing. The appellant has not submitted the copies of ITRs of the relatives from whom he has received gifts alongwith their statements of affairs and bank statements to prove the identity, creditworthiness and the genuineness of the transactions. All the documents submitted by the appellant are self-serving and cannot be accepted to have discharged the onus of proving the transactions of cash credits u/s 68 of the Act. In view of the foregoing, the addition of Rs. 2,58,03,777/- made by the Ld. AO is hereby upheld. The ground of appeal no. 2 is dismissed. Ground No.3:- The ground of appeal has been raised in respect of addition of Rs.17,24,000/- on account of alleged difference in profit declared at Rs.2,58,515/- and the profit computed by the Ld. AO at Rs. 19,82,515/-. Since, the turnover of the appellant is less than the limit mandated for audit of accounts u/s 44AB of the Act, the appellant was not required to maintain any books of accounts or explain the expenditures thereof. Hence, no addition is warranted on account of the business of the appellant. The Ld. AO is directed to delete the impugned addition of Rs. 17,24,000/-. The ground of appeal no.3 is allowed. Ground No.4:- The ground of appeal is account of addition of Rs. 18,00,000/- u/s 68 of the Act which is unsecured loan received from Sh. Mohanlal Sharma by the appellant. The cash credits received from Sh. Mohanlal Sharma have already been included for addition u/s 68 of the Act by the Ld. AO. The same has been again added to the income of the appellant by the Ld. AO making it a double addition. The addition hence made by the Ld. AO is unsustainable and is directed to be deleted. The ground of appeal no.4 is allowed. Ground No.5: The ground of appeal is account of addition of Rs. 10,00,000/- u/s 68 of the Act which are sundry creditors of the appellant. The sundry creditors are nothing but unexplained cash credits which have already been included for addition u/s 68 of the Act by the Ld. AO while making the addition of Rs.2,56,03,777/- The same has been again added to the income of the appellant by the Ld. AO making it a double addition. The addition hence made by the Ld. AO is unsustainable and is directed to be deleted. The ground of appeal no. 5 is allowed. Ground No.6 : The ground of appeal is account of addition of Rs. 15,35,337/-by the Ld. AO u/s 56(2)(vii)(b)(ii) of the Act. From the assessment order, it is seen that the impugned addition has been made on account of purchase consideration being less than the value adopted by sub registrar for the purpose of stamp duty. The assessee has carried out two such transactions during the A.Y. 2014-15. During the course of appellate proceedings, the appellant has not been able to controvert the facts stated in the assessment order or bring out any new facts through which his submission can be accepted. In view of the foregoing, the addition of Rs. 15,35,337/- made by the Ld. AO is hereby confirmed. The ground of appeal no.6 is dismissed. Ground No.7:- The ground of appeal is directed against addition of Rs.38,76,456/- made by the Ld. AO on account of agricultural income earned by the appellant. The appellant has not produced any documentary evidence regarding land holding, sale bills of crops, Jamabandi and Girdawari report etc. to support the same. In view of the foregoing, the addition made by the Ld. AO is hereby confirmed. The ground of appeal no.7 is dismissed. Ground No.8:- This ground is consequential in nature and does not require any adjudication. Ground No.9:- This ground is general in nature and does not require any adjudication. In the result, the appeal is partly allowed. 5. As the appeal of the assessee was not considered in full the assessee challenged that order of the ld. CIT(A) before this tribunal on the various grounds. Apropos to the grounds so raised by the assessee the ld. AR of the assessee has filed a detailed written submission on each ground which is reproduced below : “Brief General Facts: The assessee e-filed its Return of Income on 30.03.2015 u/s 139(4) of Income Tax Act, 1961 (for short “the Act”) declaring total income of Rs. 2,05,280/- and agricultural income of Rs. 38,76,456/- which was revised on 30.03.2016 u/s 139(5) by declaring total income of Rs. 2,05,280/- and Nil agricultural income. Case of the assessee was selected for limited scrutiny through CASS and notice u/s 143(2) was issued on dt.31.08.2015. The ld. AO observed substantial increase in the Fixed and Current Assets during the year under consideration upto Rs. 2,55,89,690/-. During the course of assessment proceedings, various notices were issued by the ld. AO which were duly replied by the assessee but the ld. AO not feeling satisfied, passed the impugned order u/s 143(3) on 26.12.2016 at Total Income of Rs. 3,57,41,850/- by making huge additions as under: a. Addition u/s 68 of Rs. 2,56,03,777/- on account of addition in Assets alleged to unexplained (at pg.3, Pr.6.1 of Asst. Order). b. Addition of Rs. 17,24,000/- in business income (at pg.4, Pr.6.2 of Asst. Order) deleted by CIT(A). c. Addition u/s 68 of Rs.18 lakhs as unexplained Unsecured Loan (at pg.5, Pr.6.3 of Asst. Order) deleted by CIT(A). d. Addition u/s 68 of Rs.10 lakhs as unexplained Sundry Creditors (at pg.6, Pr.6.4 of Asst. Order) deleted by CIT(A). e. Addition u/s 56(2)(vii)(b)(ii) of Rs. 15,32,337/- being difference in Stamp duty value and declared consideration (at pg.7, Pr.6.5 of Asst. Order). f. Addition of Rs. 38,76,456/- under Income from Other Sources on account of agriculture income (at pg.7, Pr.6.6 of Asst. Order) The Assessee filed appeal before ld. CIT(A) on 29.08.2018 against above order but unfortunately ld. CIT(A) partly upheld the additions vide it’s order dt. 25.04.2024 to the tune of Rs. 3,10,12,570/- (listed at a, e & f) made by ld. AO. Thus, feeling aggrieved from the above order of ld. CIT(A) the assessee filed this appeal. However, the Department is not in appeal. GOA 1: Is a general ground and may kindly be considered while deciding the other grounds of appeals. GOA 2: Addition of Rs. 2,56,03,777/- on account of unexplained money u/s 68 (wrongly typed of Rs. 2,58,03,777/- in CIT(A) order): (AO pg.3, Pr.6.1 and CIT(A) Pg. 11& 12) Facts: The finding of the AO at pg.3, Pr.6.1 of order is as under: “6.1 Introduction of fresh capital- As per the balance sheet furnished by the assessee during the course of assessment proceedings vide his written submission dated 25.05.2016, the assessee has shown his capital of Rs.2,57,56,456/- which is comparatively too higher as compared to the capital of Rs.1,52,679/- shown as on 31.03.2013 in the ITR for the A.Y. 2013-14. Therefore, there is increase of capital of Rs.2,56,03,777/-. The details of capital shown by the assessee as on 31.03.2014 is as under:- Dhashrath Sharma Rs. 49,19,992/- Gift received from father Rs. 2,10,00,000/- Total Rs. 2,59,19,992/- Less- Rs. 1,63,536/- I) Drawings Rs. 1,20,000/- II) Tuition Fees Rs. 43,536/- Net Capital Rs. 2,57,56,456/- From the above facts it is clear that during the year under consideration the assessee has shown increased capital of Rs.2,56,03,777/- in his capital account as on 31.03.2014. Further, on perusal of the asset side, during the year under consideration the assessee has shown total assets of Rs.2,92,29,443/-(fixed assets of Rs.2,85,69,394/- and current assets of Rs.6,60,049/-) as compared to total assets of Rs.36,39,753/-(fixed assets of Rs.18,60,416/- and current assets of Rs. 17,79,337/-). Therefore, there is increase of assets of Rs.2,55,89,690/- besides the claim of deduction of Rs.2,06,038/- on account of depreciation. Therefore, in order to verity the genuineness of the declared assets & capital, the assessee vide notice u/s 142(1) of the I.T. Act, 1961 dated 10.11.2016 was required to furnish the supporting details of documents in support of the same. In response to the above the assessee vide written submission furnished on 29-11- 2016 has stated that the assessee has shown receipt of unsecured loan of Rs. 1,50,00,000/- on 13.06.2013 from his father late Sh. Kalyan Sahay Sharma in the ITR filed on 30.03.2015. He further stated that the nature of above stated amount received from Late Sh. Kalyan Sahay Sharma was gift instead of unsecured loan which was wrongly classified in original ITR filed on 30.03.2015. Although, it had been correctly classified in his revised return filed on 30.03.2016. The assessee vide his above written submission has claimed the receipt of gift of Rs.1,50,00,000/- from his father only and no justification for the remaining capital has been furnished. Therefore, in order to verify the genuineness of the claim, the assessee vide note sheet entry dated 07.12.2016 was required to explain the source of deposits made in the bank account of his father. However, despite providing various reasonable opportunities, the assessee has neither furnished any details/documents in support of the claimed gift from his father nor he has explained the source of deposits/ credits made in the bank account of his father. Since the assessee's father is deceased, it was the onus of the assessee being legal representative to prove the source of credit entries made in the bank account of his father. However, the assessee has failed to prove the creditworthiness of his father. In the circumstances, the amount transferred in the bank account of his father remained unverified and, genuineness and creditworthiness of the same could not be proved. Therefore, the source of total capital of Rs.2,56,03,777/- is not found to be explained by the assessee. Hence, the same is treated as introduced out of his undisclosed income, Accordingly, the undisclosed income of Rs. 2,56.03,777/- is here by added to the total income of the assessee u/s 68 of the IT. Act 1961. From the above it is clear that the assessee has concealed the particulars of his income/furnished inaccurate particulars Therefore, 4 is a fit case for initiation of penalty proceedings u/s 271(1)(c) read with section 274 of the IT Act, 1961.” In the first appeal, the ld. CIT(A) firstly repeated all the facts of the case and submission made before him and thereafter commenced his discussion from Para 4, page 11 onward. Finally, the ld. CIT(A) concluded at pg.12 in following words: “Ground No.2:- The ground of appeal has been raised on account of addition of Rs.2,56,03,777/- by the Ld.AO u/s 68 of the Act. From the facts of the case, it is seen that the limited scrutiny of the assessee was converted into a full scrutiny case on account of various discrepancies observed in the submissions and the ITR of the assessee. It is seen that the appellant had filed his original return of income on 30.03.2015 declaring total income of Rs.2,05,280/- and an agricultural income of Rs.38,76,456/- for rate purposes. However, after the case of the assessee was selected for scrutiny, he preferred to revise his return of income on 30.03.2016 hence declaring total income of Rs.2,05,280/- and Nil agricultural income. The appellant has not raised any ground of appeal for considering his revised return as the true and correct statement of affairs. Since, the Ld. AO had treated the revised return just has an information filed by the assessee, the adjudication of this appeal is being done by considering the facts as stated in the original ITR of the assessee/appellant. During the course of assessment proceedings, the Ld. AO had observed that the assessee has shown an increase of capital of Rs.2,56,03,777/- in his capital account as on 31.03.2014. The appellant justified the source of increase of his capital on account of receipt of a gift of Rs.1,50,00,000/- from his late father Sh. Kalyan Sahay Sharma on 13.06.2013 (as shown in the revised ITR). The Ld. AO added a sum of Rs.2,56,03,777/- as unexplained cash credits u/s 68 to the income of the assessee. During the course of appellate proceedings, the appellant has provided the details of the sources of the cash credits as gifts received from his father- Rs.25,00,000/- (during A.Y. 2013-14) and Rs.27,00,000/- (during A.Y.2014-15) respectively, a gift of Rs.11,00,000/- from his wife, during A.Y. 2013-14 and a gift of Rs.5,00,000/- from his natural father (during A.Y.2013-14). Further, the appellant has stated that he has received unsecured loans amounting to Rs.18,00,000 from Sh. Mohan Lal Sharma and another unsecured loan amounting to Rs.5,18,800/- from various parties. An advance against land situated at Kishanpura was also received amounting to Rs.18,00,000/-. Hence, the details of total cash credits amounting to Rs.1,09,18,800/- only have been provided by the appellant out of the total addition of Rs.2,56,03,777/-. The appellant has attached various confirmations and gift deeds to support his arguments. The submissions of the appellant have been perused. It is seen that the appellant had at the time of assessment proceedings only stated to have received Rs.1,50,00,000/- from his late father as the source of the purchase of capital assets. Now, he has changed his submissions and has given cash credits to have been received as gifts from his blood relatives, acquaintances and through unsecured loans. Hence, the submission of the appellant are not only diverging but are totally unconvincing. The appellant has not submitted the copies of ITRs of the relatives from whom he has received gifts alongwith their statements of affairs and bank statements to prove the identity, creditworthiness and the genuineness of the transactions. All the documents submitted by the appellant are self-serving and cannot be accepted to have discharged the onus of proving the transactions of cash credits u/s 68 of the Act. In view of the foregoing, the addition of Rs.2,58,03,777/- made by the Ld. AO is hereby upheld. The ground of appeal no.2 is dismissed.” To clarify the CIT(A) wrongly mentioned Rs. 2,58,03,777/- whereas the correct figures are Rs. 2,56,03,777/-. The only moot question involved was whether the source of Rs. 2,56,03,777/- alleged to be the addition in the asset is duly explained by the appellant or not. Hence, this ground. Submission: 1. Non application of mind by AO: At the outset, it is submitted that the AO did not apply his mind. It is evident from the way he dealt with this issue and made the addition on the reasoning which is not only vague but self-contradictory. The AO stated that the Assessee made addition to the fixed and current asset for Rs. 2,55,89,690/- when compared with the figures of last year Balance Sheet in FY 2012-13 (AY 2013-14). This clearly implies that authorities below has not properly appreciated the facts of the case and submissions made before them. Moreover, the AO itself stated that the fact of receipts of the amounts through the banking channel, which is evident from the copy of Bank statement (PB 115-119). 2. No books of accounts, no addition possible u/s 68: 2.1.1 It is a matter of fact that the appellant never maintained any books or accounts, nor it is the case of the AO. This fact is verifiable from the ROI where the assessee denied maintaining any account. In fact, he did not make any direct inquiry, nor he specifically asked the appellant if he maintained the books of accounts. It is only because of the Balance Sheet, rather correctly stating Statement of Affairs that it was submitted by the CA on the first time and again on the second time and so on. Otherwise also, a person having a small income of around 2 lakhs is not supposed to maintain regular books of accounts and invite huge expenses on accountant, etc. Before invoking S.68, the AO was obliged to have established the jurisdictional fact that the appellant did maintain books of accounts in regular course. The appellant never relied upon books or accounts with relation to any addition or inquiry made by the AO or on any aspect of the matter before the authorities below. 2.1.2 The contention that the assessee is not maintaining Books of accounts is further supported by the facts that the assessee consistently mentioned in the Return of Income u/s 139 that he is not liable to maintain Books of Accounts as per S.44AA which fact is not disproved. The relevant part of ITR is reproduced hereinunder: - Thus, it was only an imposed presumption of the authorities below that the appellant might have maintained books or accounts and therefore they invoked S. 68 which is completely without jurisdiction. 2.1.3 The CIT(A) deleted the addition of business income (at CIT (A) Order pg. 13 middle on GOA3) saying that the assessee was not required to maintain accounts u/s 44AB against which AO is not in further appeal. If that is the scene, then whatever Balance Sheet (PB59) assessee might have furnished before the AO, whether the initial one, has no sanctity and could not have been considered by the AO. It is not the case that AO asked regarding the source of investment in the purchase of the two lands, totaling more than Rs.2 crores for which the assessee filed the Balance Sheet. Thus, the CIT(A) has contradicted his own stand in as much as on one hand he stated that no books of accounts were required etc. and deleted the addition which impliedly suggested that no Books of A/C was required but at the same time taking into account the same balance sheet showing increase in capital of Rs.2.56 crore addition u/s 68 was made and confirmed by him. If legally speaking, no Books of Accounts are required, there cannot be any case of finding any cash credit therein. 2.2.1 The law is well settled that where there are no books of accounts maintained by the assessee, S.68 can’t be applied. 2.2.2 The provisions of Sec.68 of the Act read that “S. 68: Cash credits. Where any sum is found credited in the books of an assessee maintained for any previous year, and the assessee offers no explanation about the nature and source thereof or the explanation offered by him is not, in the opinion of the [Assessing] Officer, satisfactory, the sum so credited may be charged to income- tax as the income of the assessee of that previous year …” A bare reading of Sec. 68 suggests that there has to be a credit of amounts found in the books of accounts regularly maintained by appellant during the relevant previous year. 2.2.3 Books of account have been separately defined u/s 2(12A) as under: “[(12A) “books or books of account” includes ledgers, day-books, cash books, account-books and other books, whether kept in the written form or as print-outs of data stored in a floppy, disc, tape or any other form of electro-magnetic data storage device;]” Thus, a bare reading of the above provision together with Sec.68 make it evidentiary clear that the mere annual accounts in the shape of Balance Sheet, Trading and Profit & Loss A/c etc. cannot by itself be said to be the books or books of accounts contemplated u/s 68 and therefore any credit found therein can’t be considered any sum found credited in the books of an assessee, in as much as the same cannot be treated as “books of account” by any stretch of imagination, more particularly when the same were not produced before the AO. 2.3 Supporting Case Laws: 2.3.1 CIT vs. P. Mohan Kala (2007) 291 ITR 278 (SC) held that “The question is what is the nature and scope of S.68 of the Act? When and in what circumstances Sec. 68 of the Act would come into play? That a bare reading of S. 68 suggest that there has to be credit of amounts in the books maintained by assessee; some credit has to be of during the previous year--” 2.3.2 CIT vs. Taj Borewells (2007) 291 ITR 232 (Mad) it was held as under: “In the judgment reported in S. Rajagopala Vandayar vs. CIT (1990) 81 CTR (Mad) 195 : (1990) 184 ITR 450 (Mad), in the case of S. Rajagopala Vandayar vs. CIT, this Court has taken a view that profit and loss account does not form part of the books of account and held as follows : \"We May point out that that is not the situation here, as it had not been disputed by the assessee right through that no account books at all had been maintained. The Supreme Court, in CIT vs. National Syndicate (1961) 41 ITR 225 (SC), dealing with s. 10(2)(vii) of the Indian Income-tax Act, 1922, laid down that in order to claim deduction of the loss sustained under that provision, one of the essential conditions to be fulfilled was that the loss should have been brought into the books of the assessee and written off as provided by the first proviso to s. 10(2)(vii) of the Indian Income-tax Act, 1922. At p. 234, the Supreme Court has catalogued the four conditions required to be fulfilled and the fourth condition, according to the Supreme Court, to be fulfilled is that in the books of account of the assessee, the loss should have been brought in and written off. It follows, therefore, that if this requirement is not fulfilled, the assessee is not entitled to the relief of allowance of the loss. We May now refer to the decision of this Court in P. Appavu Pillai vs. CIT (1965) 58 ITR 622 (Mad). In that case, the Tribunal took the view that relief under s. 10(2)(vii) of the Indian Income-tax Act, 1922, could be given only in cases where the assessee maintains regular books of accounts and the loss had been written off in the books and that as the assessee did not keep any accounts, the allowance was rightly refused. The Court found that though there is no indication in s. 10(2)(vii) of the Indian Income-tax Act, 1922, as to the particular type of account book which should be maintained by the assessee, if accounts are produced, in which the relevant entry with regard to the allowance appeared, that would be sufficient compliance with the first proviso to s. 10(2)(vii) of the Indian Income-tax Act, 1922. In that case, the assessee produced before the assessing authority the daily collection and expenditure account and notwithstanding the absence of a day book and a ledger, the ITO was satisfied that the obsolescence allowance claimed could be granted. But a contrary view was taken by the Appellate Assistant Commissioner and the Tribunal that the loss could be allowed only if such amount is actually written off in the books of the assessee and that books in that context would mean the books of account maintained by the assessee in the course of the business. However, the Court took the view that though the accounts maintained by the assessee May be defective in that the entries therein do not lead to a correct assessment of the income, profits and gains of the business, that has nothing whatever to do with the allowance that can be granted under s. 10(2)(vii) of the Indian Income-tax Act, 1922, if such accounts are available in which the relevant entry with regard to the allowance appears, that would be sufficient compliance with the requirement of the proviso and in that view, it was held that the details in the accounts produced in that case would be sufficient to comply with the requirements of the first proviso to s.10(2)(vii) of the Indian Income-tax Act, 1922. We May in this connection, point out that the argument of the Revenue in that case that the profit and loss account is the account which can be said to be a book of account was rejected and it was characterised as a statement representing the state of business as at the end of the accounting year with details culled from other books of account, which May be characterised as the primary books which a business man generally maintains. In other words, according to that decision, a profit and loss account is not a book of account. We are, therefore, of the view that merely by relying upon the profit and loss account, the assessee in this case cannot claim the benefit of allowance of loss sustained on the sale of the cars.\" The word \"books of account\" is not defined during the relevant assessment year. Later, s. 2(12A) was introduced in the Act defining \"books or books of account\" by the Finance Act, 2001, with effect from 1st June, 2001, and the same reads as follows : \"(12A) 'books or books of account' includes ledgers, day-books, cash books, account-books and other books, whether kept in the written form or as print-outs of data stored in a floppy, disc, tape or any other form of electromagnetic data storage device ;\" 2.3.3 In the context of Sec.271(1)(c) Explanation 5 sub clause (1), in the case of Sheraton Apparels v/s ACIT (2002) 256 ITR 20 (Bom), has held that “Penalty under s. 271(1)(c)—Applicability of Expln. 5—Books of account vis-a-vis diary—Term \"books of account\" referred to in sub-cl. (1) of Expln. 5 to s. 271(1)(c) means books of account which have been maintained for determining any source of income and whose main object is to provide credible data and information to file tax returns—It does not refer to diaries which are maintained merely as a private record to record secret, unaccounted clandestine transactions not meant for the purposes of the IT Act—Such books or diaries cannot be accepted as books of account for the purposes of Expln. 5 so as to afford immunity from penalty” The above case though decide against the assessee supports the contention of the assessee. 2.3.4 Other Case Laws: • Kantilal & Brothers v/s CIT (1995) 55 TTJ 513 (Pune ITAT), • Manoj v/s DCIT (2008) 11 DTR 1 (Del. Special Bench) para 26, • Smt. Shanta Devi v/s CIT (1988) 171 ITR 532 (P & H)- bank pass book if not books of account u/s 68, • ACIT v/s Om Prakash & Co.87 TTJ 183 (Bom.) and • S.P. Goyal v/s DCIT 77 TTJ (Mum) I (TM). Thus, when Sec.68 is not applicable, there is no onus laying upon the appellant u/s 68 nor consequently any addition could be made. Hence be deleted in full here itself. 3. Alternatively, and without prejudice to the above, on merits. 3.1. Source fully explained before lower authorities: 3.1.1 At the outset, it is submitted that the immediate source of the increase in assets, was explained and tabulated as under: Amount (in Rs.) Particulars Documents in support of claim 1,52,679 Opening capital 01.04.2013 2,10,00,000 Gift from Step Father Late Shri Kalyan Sahay Sharma [transferred sum of Rs.1.50 Crore to the assessee’s Oriental Bank of Commerce A/c 16952191005702 (PB 115) and remaining in cash on various occasions. Source: Proceed from sale agricultural land located at K. No. 626/3, Village Kanota, Tehsil Bassi, Jaipur, on 14.03.2013 to Shri Santosh Kumar Sharma for a total consideration of Rs. 1.50 Cr (PB 86- 97). Capital of Rs. 71.51 lakhs (PB 68). Kindly refer para1-4 at Pg14-15 of this WS and also refer Note 1 below table. 5,00,000 From biological Father Shri Nawal Kishore Sharma on 17.03.2013 in Cash Gift Deed (PB-6). Kindly refer para 7 at Pg14-15 of this WS 11,00,000 From Spouse of Assessee Smt. Sapna Sharma Rs. 10 Lakhs received from relatives (PB-5) and Rs. 1 Lakh from her personal Savings. Kindly refer para5-6 at Pg14-15 of this WS. 18,00,000 Unsecured Loan from Shri Mohan Lal Sharma via Banking channel on 11.06.2013 Bank Ledger of assessee (PB 60). Kindly refer para 8 at Pg14-15 of this WS. Amount (in Rs.) Particulars Documents in support of claim 5,97,242 Sale proceeds from Verna Car in cash on 25.08.2013 Car RC and Loan statement where loan of Rs. 3,83,333/- agreed to be paid by purchaser Shri Kamles (PB 7-10). Kindly refer para10 at Pg14-15 of this WS. 5,18,800 Unsecured loan from various parties listed at PB20 Affidavit from the parties (PB 21-40). Kindly refer para 11 at Pg14-15 of this WS. 18,00,000 Amount received from Shri Madan lal Sharma as token money / advance for land located at K No. 199, Village Kishanpura The. Bassi Agreement for sale of agriculture land dt. 12.05.2013 for total sale consideration of Rs. 28 lakhs (PB 52-55) 18 Lakhs received in current year and balance 10 lakhs agreed to pay in 24 months. Kindly refer para14 at Pg14-15 of this WS 4,86,953 Profit earned during the year Proft and loss statement (PB 58). Kindly refer para15 at Pg14-15 of this WS 21,00,000 Received from Ritesh Thavariya s/o Mohanlal, Jaipur on 03.04.2013 via Cheque No. 716940 Received against sale made on 25.03.2013 (AY 2013-14) for property situated at Khasra No. 87, Ramratanpura, Teh. Bassi, Dist. Jaipur (Raj.). 3,00,55,674 Total Availability of funds from various sources Note-1: The assessee is the adopted child of Sh. Kalyan Sahay Ji Sharma, who passed away in July 2015 (PB 98). Sh. Kalyan Sahay Ji Sharma was a farmer with approximately 10 bigha of land (Land Holding Paper PB99-102). He also cultivated additional land on a sharecropping basis, bringing his total farmed land to around 30-35 bigha annually ( Khasra Girdhawri PB103-106). The agricultural produce was sold in the open market through Aadatiya or directly to consumers. Due to ill health and concerns about the assessee's future, Sh. Kalyan Sahay Sharma initiated a phased transfer of his assets to the assessee. This decision was motivated by a desire to protect the assessee from potential disputes or difficulties that might arise in a traditional family setting, particularly in rural areas. Not to be surprised to mention that Sh. Kalyan Sahay Sharma, being a farmer from a rural background, was not familiar with formal banking systems. As per usual practice with the villager, he typically kept his wealth at home or provided financial assistance to relatives in need without charging interest. Gift of Rs. 2.10 Cr. to assessee: In light of the above, the gift of Rs. 2.10 crores from Shri Sharma to the assessee is a logical and consistent step in his plan to secure the assessee's future. The transfer of assets was a deliberate act intended to provide the assessee with financial stability and independence. 3.1.2 Source of Gift: a. Sale of Agricultural Land: The assessee's stepfather, concerned about his own deteriorating health, sold his agricultural land located at K. No. 626/3, Village Kanota, The Bassi, Jaipur, on 14.03.2013 to Shri Santosh Kumar Sharma for a total consideration of Rs. 1.50 Cr against sale of Agriculture land (PB 86-97). The said sale proceeds, received through bank by through father and deposited in SBBJ Bank (Bank Statement - PB 114) and thereafter transfer to assessee bank account (OBC Bank Statement- PB 115) were the primary source of the gift to the assessee. b. Personal Capital: The assessee's father had capital of Rs. 68,38,632/- as on 01.04.2013, and profit of Rs. 3,12,428.61 earned during the AY 2014-15 (PB67-68). This capital and profit were also used to contribute to the gift. Thus, the gift of Rs. 2.10 crores from assessee’s step father is a genuine and bona fide transaction. The circumstances surrounding the gift, including the donor's intentions, the assessee's relationship with the donor, and the sale of the stepfather's agricultural land, clearly demonstrate the legitimacy of the transaction beyond any doubt. 3.2 Initial onus stands fully and duly discharged: 3.2.1 At the outset it is submitted that it is only initial onus, which lay upon the appellant to prove the identity and the capacity of the creditors and the genuineness of the transaction and once this initial onus is discharged, it shifts to the ld. AO to rebut/disprove the same for making a valid addition u/s 68. Kindly refer CIT v/s Shree Barkha Synthetics (2003) 182 CTR 175 (Raj), Shanker Industries v/s CIT (1978) 114 ITR 689 (Cal) and First Point Finance Ltd 286 ITR 477 (Raj). 3.2.2 The appellant, in the present case, did discharge the initial onus cast upon and satisfied all the three conditions as under: 3.2.3 Identity Established: The identity of all the creditor stood established with the help of the duly notarized affidavits / sale deeds bearing complete name and address and some of them are having PAN. Therefore, identity is not otherwise in dispute. 3.2.4 Genuine Transaction and capacity proved: It is submitted that the major creditor being the late father, had already shown the entire amount of Rs. 2.10 crore, given by him to the son, and appearing in his Balance Sheet(PB 67-68), evidences in the shape of affidavits, sale deeds, etc, were submitted, which are referred in this written submission. 3.2.5 Supporting case laws: 3.2.5.1 Kindly refer Labhchand Bohra V/s ITO (2008) 8 DTR 44 (Raj.) held that “Cash credit- burden of proof- identity of the creditors established and the confirmed the credit. This discharged the burden of appellant to prove genuineness. However capacity of the lender to advancement money to appellant was not a matter which the appellant could be required to establish and that would amount to calling upon him to establish the source of source. Hence addition cannot be sustained.” 3.2.5.2 In Aravali Trading Co. v/s ITO (2008) 8 DTR 199 (Raj) (DPB 11-19) held that “Once the existence of the creditors is proved and such persons own the credits which are found in the books of the appellant, the appellant’s onus stand discharged and the latter is not further required to prove the sources from which the creditors could have acquired the money deposited with him and, therefore the addition u/s 68 cannot be sustained in the absence of anything to establish that the sources of the creditors deposits flew from the appellant itself.” 3.3 Submission before lower authorities: In this regard it is submitted that, the assessment proceedings were completed in haste and arbitrarily manner. The assessee in good faith and to seek justice tried to bring the documents on record send the same through India Post on 29.12.2016 (PB4). Unfortunately, the ld. CIT(A) again ignored the submission made before him which is reproduced as under (also at CIT(A) order Pg.3): “1. It is stated that I am adopted child of Sh. Kalyan Sahay Ji Sharma, who had deceased in July, 2015. He was farmer and heaving 10 bigha land (approx.), further he used to take land on ‘BATAI’ basis for farming and earn agriculture income, as per my knowledge, he generally farms the land around 30 to 35 bigha every year which were include his own land as well as land taken on ‘BATAI’ basis and used to sold agriculture products in open market or door basis through himself or through employees. 2. From the year 2011-12, to till his death he was generally in ill position and he was conscious about my future after his death. Generally in traditional families or in rural area’s in such kind of positions, relative makes some nuisance or make dispute for adopted child. So remove such kind of problems, he decided to phase wise transfer of his assets in my favour. 3. It is worthy to state that he was farmer and lives in rural areas so he was not well aware about banking systems and generally held his money or other wealth at home or used to give money his relatives for their hard time as advance without any interest, just to help them. 4. In the FY 2012-13, I had received cash gift of Rs.25.00 lacs (Rupees Twenty Five Lacs only) and further received Rs.27.00 lacs (Rupees Twenty Lacs Only) in FY 2013-14 from my father for purchases of land and other assets out of his savings or as received from his relatives which were earlier given as advances to them for their requirements. 5. Further stated that in the FY 2011-12, I got married with Smt. Sapna Sharma D/o Sh. Murari Lal Sharma, Village Toda Thekala, Tehsil-Lalsot, Dasua. 6. That in the FY 2012-13 I received cash money of Rs.11.00 (Rupees Eleven Lacs) from my wife as gift out of his savings and amount received from her father and other relatives as gift. She received cash gift of Rs.10.00 lacs (Rs. Ten Lacs Only) from his father and other relatives, further she also had some savings, out of which she made cash gift of Rs.11.00 lacs. (Copy of gift deed in favour of Smt. Sapna From her father and other relatives attached herewith-annexure no.1-pg.6). 7. It is further stated that I also received cash gift of Rs.5.00 lacs (Rupees five lacs) from my natural father Sh. Naval Kishore Sharma against his natural love and affection for me. (Annexure No.2- pg. 7). 8. Further stated that I had taken unsecured loan of Rs.18.00 lacs (Rupees Eighteen Lacs) from Sh. Mohan Lal Sharma S/o Sh. Mahadev Prasad Sharma, R/o VillageChak Bhejupura, Tehsil-Bassi, PAN-BMNPS8095K. it was taken at the time of when I was purchasing land at Bagarana, and I had no sufficient fund, that’s why I approaches to Sh. Mohan Lal Sharma and he had agreed to give me unsecured loans for Rs.18.00 lacs (Rupees Eighteen Lacs) vide RTGS from SBBJ Bank. It is further stated that after going through statement of Sh. Mohan Lal Sharma as recorded by your kind office, it is come to know that he had denied to give unsecured loan in my favour. Here it is worthy to state that I had received unsecured loan out of his own fund through RTGS in my saving account no.16952191005702 of OBC Bank Knota. I had never give him any cash to deposit in his account and than grant a loan to my favour. So it is request, please go through all the facts and his bank account and decide. Here I further affirm that if the above point no.8 is true and correct and find otherwise than I will solely liable to pay income tax on such money without any hesitation. 9. Further stated that agriculture income shown in my original return filled on 30.12.2015 were wrongly shown as the return was getting time barring and due to hurries, it was wrongly shown. Please not consider the same. 10. Further stated that in FY 2012-13, there was no Motar Car in my name, which was wrongly shown in balance sheet, further stated that I had purchased a car in FY 2013-14 and after two month I sold the same in favour of Sh. Kamlesh Kumar Sharma S/o sh. Ramesh Chand Sharma for Rs.980575/- out of Rs.597242/- I had received in cash and balance Rs.383333.00 which was also outstanding in favour of AU Finaciares, liability to pay the same loan had taken by the said purchaser. We are also enclosing herewith the copy of loan statement and copy of RC in favour of said purchaser. We are also enclosing herewith CIBIL Report to show that I had no other loan liability at that time. (As per annexure no.3, pg no.8-16) 11. Further stated that during the year I had also received unsecured loans from other parties of Rs.518800.00 (Rs. Five Lacs Eighteen Thousand Eight Hundred Only). List of same is also attached herewith for your kind perusal along with their declarations. (Annexure no.4-pg no.17) 12. It is further stated that agriculture land at Kacholiya having Khasara no.199 for Rs..20.50 lacs (Rupees Twenty lacs and fifty thousand) was wrongly shown in FY 2013-14, actually that land had been purchased in FY. 2015-16. Copy of same is attached herewith for your kind perusal. (Annexure no.5, Pg no.18-24) 13. It is further stated that Plot no.129, 130 & 131 situated at Radha Govind Nagar had been sold in June 2013 for Rs.3.00 lacs (Rupees three lacs only) due to requirement of cash. Hence it was also not exist in FY. 2013-14 in my balance sheet. 14. Further stated that I had received Rs.18.00 lacs (Rupees Eighteen lacs) as advance against land situated at Kishanpura. Copy of that agreement is attached herewith for your kind perusal. (As per annexure no.6 pg no.25-28) 15. Further I am also enclosing herewith my correct asset and liability statement along with cash account, revised profit and loss account, bank book copy, cash book copy for your kind perusal along with capital account of Sh. Kalyan Sahay Sharma for FY 2012-13 (As per annexure no.7, 7a, 7b, 7c,7d,7e,7f,7g, & 7h, pg. no.29-41) I affirms that the above stated points 1 to 15 are correct as per my best belief. So please find the above submission in order and oblige. I further request you to provide another opportunity if your kind office find any clarification in such regards.” 4. Allegations of CIT(A): 4.1. The allegations of the CIT(A) are more based on suspicion and without appreciating the correct position of law. Allegation that the appellant changed his submission with regard to the amount received from his late father Shri Kalyan Sahay Sharma of Rs. 1.50 crore, is not material in as much as earlier the appellant claimed the same to have been received as a loan but this being a bona fide factual mistake committed by him, it was duly corrected by saying that it was a case of gift received from his father and was shown in the revised ITR. But the vital fact is that the assessee was in receipt of amount from his late father, be it by way of loan or by way of gift. Notably, the very fact of giving amount to the appellant by his late father during his lifetime is fully evident and supported by the Balance Sheet in the case of the father (PB 67) filed during appellate proceedings. Notably, the content of the Balance Sheet has neither been disputed nor has been disproved. Unfortunately however, the ld. CIT(A) did not adjudicate the legal issue arising from the assessment order appealed against by merely saying that (at pg. 11) “The appellant has not raised any ground of appeal for considering his revised return as the true and correct statement of affairs. Since, the Ld. AO had treated the revised return just has an information filed by the assessee, the adjudication of this appeal is being done by considering the facts as stated in the original ITR of the assessee/appellant.” There can’t be any dispute over the settled legal proposition that the powers of the first appellate authority are very wide and co-terminus with those of the AO and what AO can do, he can do and what AO fail to do, that also he can do. Kindly refer Kanpur Coal Syndicate 53 ITR 225 (SC). Therefore, CIT (A) was bound to have adjudicated upon this legal aspect. 4.2 The AO alleged that the appellant being the LR must have explained the source of the amount deposited in the hands of the father. In other words, the AO wanted to tax the income (if assuming so) from whatever source in the hands of late father now through or in the hands of the son which is completely contrary to the concept that father and sons who are two separate assessee u/s 2(31) of the Act. Otherwise also AY 2014-15 getting time barred the AO could not have used the hands of the son even though he was LR, so as to tax the income which otherwise belonged to father. There is no whisper in the entire order of the AO & CIT(A) that the amount deposited in the bank account of the father in fact and in law belonged to the assesse only (except alleging that u/s 68 the appellant failed to explain the source etc. but it is only a technical plea). In substance it was the income of the father and if AO felt dissatisfied with the source, he could have made inquiry/taken action in the hands of late father only, but not in the hands of the appellant’s son. The law is well settled that AO can't ask source of source. By citing the first source the appellant successfully discharged the initial burden lay upon him. Thus, major part of the source of purchase of land is to be explained. 4.3 The AO alleged that the Mohan Lal Sharma has denied giving any amount to the assessee. However, the same is just contrary to the admitted facts that the amount was received through account payee cheque only there is no evidence of giving cash by assessee to him. Opportunity of cross examination was given hence such statement could not be relied upon variedly and addition based thereon deserves to be deleted as held in the case of Andaman Timber (2015) 62taxmann.com3 (SC). The denial is clearly to save his own skin. 5. Otherwise also, the AO not having set up the case u/s 69 and CIT(A) not having invoked that provision even in the first appeal, now ITAT cannot invoke the same because it is not the controversy before the ITAT. 6. Lastly, S.68 is discretionary as held in P.K. Noorjahan. Hence the entire impugned addition based on misconception of Law, misreading of facts and merely based on suspicion, deserves to be deleted in full. GOA-3: Addition of Rs. 15,32,337/- u/s 56(2)(vii)(b)(ii) bad in law: (AO Pg.7 Pr.6.5 & CIT(A) Pg.14) Facts: During the year the assessee purchased 2 agriculture lands located at Bassi, Jaipur. The ld. AO on perusal of purchase deeds furnished by the assessee, observed that the assessee has paid purchase consideration less than the Stamp Duty Value or (“SDV/DLC” for short) of the property as contemplated u/s 56(2)(vii)(b)(ii) of the Act. The relevant detail are tabulated hereunder for reference (also given at pg. 7 of the Assessment Order): a b c d e f g Sr . N o. Addre ss of proper ty Date of purch ase Declare d Sale Conside ration Value Adopt ed by the sub- registr ar Differe nce (d-e) % of differ ence (f/e*1 00) 1. Agricul tural land khasra No. 199 of Vill. Kishan pura, Bassi, Jaipur 01.05. 2013 55,00,0 00/- 69,48, 411/- 14,48, 411/- 20.8 5% 2. Agricul tural land khasra No. 117 of vill. Dayar 09.01. 2014 6,50,00 0/- 9,33,9 26/- 83,92 6/- 8.98 % ampur a, Bassi, Jaipur Total 15,32, 337/- The ld. AO alleged that the assessee failed to declare Rs. 15,32,337/- in ITR filed and finally held as under: “6.5 Addition u/s 56(2)(vii)(b)(ii) of the IT.Act, 1961- As per the copy of purchase deeds available on records during the year under consideration the assessee has purchase the following immovable properties, where purchase consideration is less than the value adopted by the sub registrar for the purpose of stamp duty. The details of which are as under- ------xxx------xxx------xxx------xxx------xxx------xxx------ From the above chart it is clear that the total purchase value of the properties is less by Rs. 15,32,3377- as compared to the DLC value and purchase value. Therefore, as per the provisions of section 56(2)(vil)(b)(ii) of the I.T.Act, 1981 the excess amount of Rs. 15,32,3377- is chargeable to be income-tax under the head \"Income from other Sources. However, the assessee has failed to declare such income in his return of income for the year under consideration. Looking to the above discrepancies, the assessee, vide notice u/s 142(1) dated 10.11.2016 thereafter, vide note sheet entries was required to explain as to why the excess amount may not be added to his total income. However, In response to the above, the assessee has failed to furnish any justification for the same. In the circumstances, the excess value of Rs. 15,32,337/- is treated as undisclosed income of the assessee and accordingly, the same is hereby added to the total income of the assessee under the head 'income from other sources. From the above it is evident that the assessee has concealed the particulars of her income/furnished inaccurate particulars of her income before the revenue. Therefore, it is a fit case for initiation of penalty proceeding of u/s 271 (1)(c) of the I.T.Act 1961.” The ld. CIT(A) at pg.14 held in following word: “Ground No.6:- The ground of appeal is account of addition of Rs.15,35,337/- by the Ld. AO u/s 56(2)(vii)(b)(ii) of the Act. From the assessment order, it is seen that the impugned addition has been made on account of purchase consideration being less than the value adopted by sub registrar for the purpose of stamp duty. The assessee has carried out two such transactions during the A.Y. 2014-15. During the course of appellate proceedings, the appellant has not been able to controvert the facts stated in the assessment order or bring out any new facts through which his submission can be accepted. In view of the foregoing, the addition of Rs.15,35,337/- made by the Ld. AO is hereby confirmed.” To clarify a clerical mistake, the CIT(A) wrongly mentioned Rs. 15,35,337/- whereas the correct figures are Rs. 15,32,337/-. Hence, this ground. Submission: 1. At the outset, it is submitted that alleged addition made u/s 56(2)(vii)(b)(ii) of the Act is not the final word in as much as the DLC rates being determined by the District Level Committee, is not based on any scientific analysis and is a mere estimation based on prevailing market conditions, location of property, etc. and hence the same cannot replace the concept of fair market value that is the sale consideration being decided in the open market between the buyer and seller. 2. Minor and Negligible variation: 2.1 The only issue involved in this appeal is the difference between the declared purchase consideration and the stamp duty valuation with regard to purchase of two properties as per table given at page 7 of Assessment Order. 2.2 Regarding the property being agriculture land Khasra No.117 of Vill. Dayarampura, Bassi, Jaipur the amount of variation appears to be only 8.98% (83,926 / 9,33,926 *100). Needless to say that an estimation is an estimation only and can never take the place of actuals. This is also nothing but an estimation which is bound to vary than the actual specially in the cases of purchase and sale of land wherein a lot factors and variables decide the actual price of the buyers and sellers. 3. Applicability of Safe Harbour limit: It submitted that S. 50C(1) or 56(2)(vii) as also 43CA of the Act were an anti-avoidance provision to prevent evasion of tax by showing lesser consideration in the transactions. However, after acknowledging the fact of variance between the stamp duty value and the actual consideration, the proviso was initially introduced by Finance Act 2018 from A.Y. 2019-20, introducing the \"safe harbour limit\" of 5%, which has been enhanced to 10% (inserted by Finance Act 2020 w.e.f. 01.04.2020). The amendment was essentially brought about to cure \"unintended consequences\" of section 50(1) even in a bonafide situations. Be that as it may, the question is whether the benefit of the proviso as aforesaid can be extended in this case of assessee. As noticed earlier the issue is no longer res integra as it is covered by the decision discussed hereunder. 4.1 Reliance is placed on: 4.1.1 Maria Fernandes Cheryl v. ITO, (International Taxation) [2021] 123 taxmann.com 252/187 ITD 738 (Mumbai - Trib.) (DC 1-9)held as under: “8. Once legislature very graciously accepts, by introducing the legal amendments in question, that there were lacunas in the provisions of Section 50 C in the sense that even in the cases of genuine variations between the stated consideration and the stamp duty valuation, anti-avoidance provisions under section 50C could be pressed into service, and thus remedied the law, there is no escape from holding that these amendments are effective with effect from the date on which the related provision, i.e., Section 50C, itself was introduced. These amendments are thus held to be retrospective in effect. In our considered view, therefore, the provisions of the third proviso to Section 50C (1), as they stand now, must be held to be effective with effect from 1st April 2003. We order accordingly. Learned Departmental Representative, however, does not give up. Learned Departmental Representative has suggested that we may mention in our order that \"relief is being provided as a special case and this decision may not be considered as a precedent\". Nothing can be farther from a judicious approach to the process of dispensation of justice, and such an approach, as is prayed for, is an antithesis of the principle of \"equality before the law,\" which is one of our most cherished constitutional values. Our judicial functioning has to be even-handed, transparent, and predictable, and what we decide for one litigant must hold good for all other similarly placed litigants as well. We, therefore, decline to entertain this plea of the assessee.” 4.1.2 Rajeev Kumar Agarwal v. Addl. CIT [2014] 45 taxmann.com 555/149 ITD 363 (Agra - Trib.) (para 14) (DC 10-15) wherein Hon’ble Agra ITAT bench was dealing with the question whether insertion of a proviso to Section 40(a)(i) to cure intended consequence could have retrospective effect, even though not specifically provided for, and speaking through one of us (i.e. the Vice President), the coordinate bench had, after a detailed analysis of the legal position, observed that, \"Now that the legislature has been compassionate enough to cure these shortcomings of provision, and thus obviate the unintended hardships, such an amendment in law, in view of the well settled legal position to the effect that a curative amendment to avoid unintended consequences is to be treated as retrospective in nature even though it may not state so specifically, the insertion of second proviso must be given retrospective effect from the point of time when the related legal provision was introduced\". 4.1.3 Commissioner of Income Tax, Chennai v. Vummudi Amarendran* [2020] 120 taxmann.com 171 (Madras) (DC 16-21) “7. Before we proceed to consider as to whether proviso inserted in Section 50C of the Act has to be read retrospective or prospective, we need to point out that the Assessing Officer did not doubt the bona fides of the transaction done by the assessee, since the Assessing Officer accepted the fact that the assessee had entered into an Agreement for Sale of the property in question vide Agreement for Sale dated 4-8-2012, wherein agreed sale consideration was Rs. 19 Crores and the assessee had received Rs. 6 Crores by way of account payee cheque on the date of signing the Agreement. This fact was noted by the CIT(A) and held that the Agreement cannot be treated to be ante-dated as the assessee had received Rs. 6 crores as advance on the date of Agreement through banking channel. The only reason for the Assessing Officer to adopt higher value is based upon the guideline value fixed by the State Government. The question would be as to what is the effect of the guideline value fixed by the Government and the purpose behind fixing the same. This aspect was clearly explained in the case of J. Jayalalitha. It has been pointed out that the guideline value has relevance only in the context of section 47A of the Indian Stamp Act (as amended by Tamil Nadu Act 24 of 1967) which provides for dealing with instruments of conveyance which are undervalued. The guideline value is a rate fixed by the authorities under the Stamp Act for the purpose of determining the true market value of the property disclosed in an instrument requiring payment of stamp duty. Thus, the guideline value fixed is not final but only a prima facie rate prevailing in an area to ascertain the true or correct market value. It is open to the Registering Authority as well as the person seeking registration to prove the actual market value of the property. The authorities cannot regard the guideline valuation as the last word on the subject of market value but only a factor to be taken note of, if at all available in respect of an area in which the property transferred lies. It was further pointed out that this position is made clear in the explanation to Rule 3 of the Tamil Nadu Stamp (Prevention of Undervaluation of Instruments) Rules, 1968; this explanation also will have to be read in conjunction with explanation to section 47(A) of the Indian Stamp Act (as amended by the Tamil Nadu Act 24/1967). It was further pointed out that undue emphasis on the guideline value without referred to the setting in which it is to be viewed will obscure the issue for consideration. Further it was held that in any event, if for the purpose of the Stamp Act, guideline value alone is not a factor to determine the value of the property, its worth will not be any higher in the context of assessing the true market value of the properties in question to ascertain whether the transaction has resulted in any offense so as to give a pecuniary advantage to one party or other. ------xxx------xxx------xxx------xxx------xxx------xxx------ 12. The Honble Supreme Court in Kolkata Export Company took note of the earlier decisions on the same issue in the case of Allied Motors (P.) Ltd. v. CIT [1997] 91 Taxman 205/224 ITR 677, Whirlpool of India Ltd. v. CIT [2000] 245 ITR 3, CIT v. Amrit Banaspati Co. Ltd. [2002] 123 Taxman 74/255 ITR 117 (SC) and CIT v. Alom Enterprises [2009] 185 Taxman 416/319 ITR 306 and held that the new proviso should be given retrospective effect from the insertion on the ground that the proviso was added to remedy unintended consequences and supply an obvious omission. The proviso ensured reasonable interpretation and retrospective effect would serve the object behind the enactment. Thus by taking note of the above decisions, we have no hesitation to hold that the proviso to Section 50C(1) of the Act should be taken to be retrospective from the date when the proviso exists. The CIT(A) while allowing the assessee's appeal vide order dated 25-7- 2019, took note of the submissions made by the assessee wherein they placed reliance on the decision of the Ahmadabad Bench of the Tribunal in the case of Dharamshibhai Sonani v. Asstt. CIT [2016] 75 taxmann.com 141/161 ITD 627, order of the Delhi Bench of the ITAT in the case of Income tax Officer v. Modipon Ltd. [2015] 57 taxmann.com 360/154 ITD 369.” 4.1.4 Amrapali Cinema v. ACIT, Circle-I, Meerut [2021] 127 taxmann.com 376 (Delhi - Trib.) (DC 22-26) head note is reproduced hereunder: “Section 50C of the Income-tax Act, 1961 - Capital gains - Special provision for computation of full value consideration (Safe harbour) - Whether amendment made in scheme of section 50C(1), by inserting third proviso thereto and by enhancing tolerance band for variations between stated sale consideration vis-à- vis stamp duty valuation from 5 per cent to 10 per cent are effective from date on which section 50C, itself was introduced, i.e 1-4-2003 - Held, yes - Whether in plain words, what it means is that even if valuation of a property, for purpose of stamp duty valuation, was 10 per cent more than stated sale consideration, stated sale consideration would be accepted at face value and anti-avoidance provisions under section 50C would not be invoked - Held, yes [Paras 8 and 10][In favour of assessee]” 5. Further Circular 8 of 2018 on 26.12.2018 by the Central Board of Direct Taxes (CBDT) viz. explanatory notes to the Finance Act 2018, which intended the rationalization of section 43CA, section 50C and section 56 of the said Act. The relevant portion of Circular 8 of 2018 reads thus: \"16.1 Before amendment by the Act, for computing income from business profits (section 43CA), capital gains (section 50C) and other sources (section 56) arising out of transactions in immovable property, the higher of sale consideration or stamp duty value was adopted. The difference was taxed as income both in the hands of the purchaser and the seller. 16.2 It has been pointed out that the variation between stamp duty value and actual consideration received can occur in respect of similar properties in the same area because of a variety of factors, including shape of the plot or location. 16.3 In order to minimize hardship in case of genuine transactions in the real estate sector, section 43CA, section 50C and section 56 of the Income-tax Act have been amended to provide that no adjustments shall be made in a case where the variation between stamp duty value and the sale consideration is not more than five per cent of the sale consideration.\" It can thus be seen that the CBDT had acknowledged that there can be genuine cases, where there would be a variance between the \"stamp duty value\" and the \"actual consideration received\" in respect of similar properties depending upon variety of factors. Moreover, variance indeed occurs on the basis of location, dimension, access and other facilities which a particular property may enjoy. Therefore, it is necessary to note that the stamp duty value or the ready reckoner value is essentially an estimate. 6. The difference in this case is more than 5% but below 10% being 8.98% however in view of the judicial guidelines the amendment made in the tolerance limit whether upto 5% or 10% (inserted by Finance Act 2020 w.e.f. 01.04.2020), has along been held to be retrospective in nature in effective from 01.04.2003 (i.e.) right since the inspection of S.50C of the Act itself. Consequently, the fact of the present case being squarely covered by the above decisions the addition so made merely on this sole basis, this to be deleted in full. 7. On Merits: But otherwise also, there is merits behind the difference being that the said the plot suffered location disadvantages which has significantly reduced the market value of the property. The Hon’ble Courts have also recognized that because of the locational disadvantage or advantage, suitable rates must be made. Accordingly, variation of less than 10% because of the very fact, is not abnormal and deserves to be accepted. B.1 Addition without Jurisdiction: The ld. AO made addition and also CIT(A) erred in confirming the same without looking to the fact that the provision under which the addition was made was introduced by Finance Act, 2013 wef 01.04.2014. It is submitted that the pre-amended law contemplates the only situation where the immovable property is sold without consideration but the law never contemplated the sale with inadequate consideration. This amendment came into effect form 01.04.2014 which means that any transaction of sale carried out on or after that date but not before that date. It was held that the applicability of s. 50C is to be reckoned from the cut off date and cannot be applied w.r.t a particular assessment year as was held in the case of Ashutosh Bharghav V DCIT (2011) 138 TTJ (JP) 479. In this case, the land was purchased on 01.05.2013 i.e. much earlier to 01.04.2014 and shall be governed by the pre-amended law. In this view the addition made by the AO u/s 50C r.w. 56(2)(vii)(b), is completely without jurisdiction and deserves to be quashed. B.2.1 Covered issue: Naina Saraf Vs. Pr. CIT, (ITAT Jaipur) (2021) 35 NYPTTJ 710 (Jp) held as under: “8. Now we come to the provisions of s. 56(2)(vii), which stood prior to the amendment. \"(b) any immovable property,— (i) without consideration, the stamp duty value of which exceeds fifty thousand rupees, the stamp duty value of such property; The Finance Act, 2013 inserted cl. (ii) in s. 56(2)(vii)(b) reading as under : \"(ii) for a consideration which is less than the stamp duty value of the property by an amount exceeding fifty thousand rupees, the stamp duty value of such property as exceeds such consideration\" The pre-amended law evidently did not cover a situation where an immovable property was received by an individual or HUF for a consideration, whether adequate or inadequate, whether consideration was less than the stamp duty valuation by an amount exceeding Rs. 50,000. In other words, the preamended law which was applicable up to asst. yr. 2013-14 never contemplated such a situation and it was only in the amended law, specifically made applicable for and from asst. yr. 2014-15 that any receipt of the immovable property with inadequate consideration has been subjected to the provisions of s. 56(2)(vii)(b) but not before that. Hence, the applicability of the said provision in such cases, could not be insisted in the assessment years prior to asst. yr. 2014-15. Having said this, in this case, there was a valid and lawful agreement entered by the parties long back in asst. yr. 2010-11 only, when the subject property was transferred and substantial obligations were discharged. The law contained in s. 56(2)(vii)(b) as stood at that point of time did not contemplate a situation of a receipt of property by the buyer for inadequate construction. Hence, we are of the considered view that the learned Principal CIT erred in applying the said provision. Because of the mere fact that the flat was registered in the year 2014 falling in asst. yr. 2015-16 on the fulfilment of the conditions, the amended provision of s. 56(2)(vii)(b)(ii) could not be applied. B.2.2 Our view finds support from the decision in the case of Bajranglal Naredi vs. ITO (2020) 203 TTJ (Ranchi) 925 : (2020) 187 DTR (Ranchi)(Trib) 49 (DPB 1-4) wherein it was held that : \"Income from other sources—Chargeability—Applicability of s. 56(2)(vii)(b) visa-vis date of registration of property—Assessee got registered an immovable property on 17th June, 2013 against the actual purchase of property on 15th April, 2011— Purchase consideration was determined at Rs. 9,10,000 at the time of agreement for purchase—At the time of registration the stamp duty valuation stood at a higher figure at Rs. 22,60,000—Provision of s. 56(2)(vii)(b) was substituted by Finance Act, 2013 and made applicable to asst. yr. 2014- 15 onwards—As per the amended provisions, the scope of substituted provision was expanded to cover purchase of immovable property for inadequate consideration as well—Mere registration at later date would not cover a transaction already executed in the earlier years and substantial obligations have already been discharged—Hence, the AO is directed to delete the additions made under s. 56(2)(vii)(b).\" Alternatively, in both cases, appellant should get opportunity to file objection u/s 50C (2). Hence the impugned addition u/s 56 based on misconception of Law, misreading of facts and merely based on suspicion, deserves to be deleted in full. GOA-4: Addition of Rs. 38,76,456/- under income from other sources: Facts: The ld. AO has dealt this issue at pg.7 para 6.6 in following words: “6.6 Agriculture income- During the year under consideration the assessee has shown agriculture income of Rs 38,76,456/- in his return of income filed on 30.03.2015, In order to verify the genuineness of the declared agriculture income the assessee vide notice u/s 142(1) dated 10.11.2016 was required to furnish the documentary evidence regarding land holding sale bill of crops jamabandi and girdawari report in support of the same. However, despite providing various reasonable opportunities, the assessee has failed to furnish any of the above required details and documents, In the circumstances, the claim of agriculture income remained unverified. Accordingly the same is treated as unexplained other sources income and added to the total income of the assessee From the above it is clear that the assessee has concealed the particulars of his income/furnished inaccurate particulars. Therefore, it is a fit case for initiation of penalty proceedings u/s 271(1)(c) read with section 274 of the IT Act, 1961.” On this aspect, the ld. CIT(A) at pg.15 confirmed as under: “Ground No.7:- The ground of appeal is directed against addition of Rs.38,76,456/- made by the Ld. AO on account of agricultural income earned by the appellant. The appellant has not produced any documentary evidence regarding land holding, sale bills of crops, Jamabandi and Girdawari report etc. to support the same. In view of the foregoing, the addition made by the Ld. AO is hereby confirmed.” Hence this ground. Submission: 1. In this regard, following submission made before CIT(A): “9. Further stated that agriculture income shown in my original return filled on 30.12.2015 were wrongly shown as the return was getting time barring and due to hurries, it was wrongly shown. Please not consider the same.” 2. Addition as Income from Other Sources is completely without jurisdiction: A perusal of the orders of authorities below shall reveal that the only basis of making the addition of Rs. 38.76 lakhs is that the appellant had declared Agricultural Income in the initially filed ROI u/s 139(4) dt.30.03.2015 however, the assessee failed to furnish any document to substantiate the same. The authorities below had clearly ignored the revised ROI filed showing “Nil” income, which is also clear from the stand taken by the ld. CIT(A) in Page11, saying that “The appellant has not raised any ground of appeal for considering his revised return as the true and correct statement of affairs.”. Thus, ld. CIT (A) in absence of any specific ground, choose continuing with the originally filed ROI. Even the ld. AO held that the initial ROI not having been filed within the time permitted u/s 139(1), the revised ROI was liable to be ignored. However, the authorities below did not judiciously and correctly consider the provisions of law, in as much as the law confers specific power on the assessee to revise the initially filed ROI if he finds some “omission or wrong statement” therein provided such revision is possible only when initial ROI is filed within the time prescribed u/s 139(1) or it is in response to notice u/s 142(1). On the other hand, S.142(1) obliges the AO to issue a notice if no return is filed by the assessee within the permissible time limit. In this case, the assessee did not file the initial ROI u/s 139(1) before the due date being 31.07.2014, as the same was filed belatedly u/s 139(4) on 30.03.2015. Therefore, it was for the AO to have issued notice u/s 142(1) calling the appellant to file the ROI, which he has failed to comply with. On the other hand, the AO issued a notice u/s 143(2) on 31.08.2015 and thereafter the revised ROI was filed by the assessee on 30.03.2016. The AO not having issued any notice u/s 142(1) though obliged by the statute, it did not lie in his mouth now to raise objection and to ignore the revised ROI filed on 30.03.2016. In fact, when he issued notice u/s 143(2), he was also supposed to have issued notice u/s 142(1) along with the same, which he did not. It is not the case of the AO that the revised ROI was filed out of time, which was within 1 year from the end of the relevant financial year in which the initial ROI was filed, which fall on 31.03.2016. For these reasons, the authorities below were bound to have considered the revised ROI and the declarations made therein. There appear a seeming contradiction in the drafting of the provision seen as much as the notice u/s 143(2) could be issued for any type of ROI whether filed initially u/s 139(1) or u/s 139(4), i.e. belated. But for revision of ROI so filed, the assessee is supposed to file the ROI within the time limit of S. 139(1) only. When the law has conferred a right upon the assessee to revise the ROI, noticing any “omission or wrong statement” made earlier, why such opportunity should not have been given w.r.t. ROI whether filed u/s 139(1) or u/s 139(4) belated and for these reasons only, the legislature has amended the provision u/s 139(5) by the Finance Act 2016, though w.e.f. 01.04.2017 by also adding “S. 139(4)”. Such a provision being remedial and benevolent, helping in removing the hardship, have been held to be retrospective in similar type of situations. 3. Supporting case laws: 3.1 Reliance is placed On Apex Court decision in the case of Allied Motors (P.) Ltd. v. Commissioner of Income-tax [1997] 224 ITR 677 (SC) which held as under: “5. Section 43B was, therefore, clearly aimed at curbing the activities of those taxpayers who did not discharge their statutory liability of payment of excise duty, employer's contribution to provident fund, etc., for long periods of time but claimed deductions in that regard from their income on the ground that the liability to pay these amounts had been incurred by them in the relevant previous year. It was to stop this mischief that section 43B was inserted. It was clearly not realised that the language in which section 43B was worded would cause hardship to those taxpayers who had paid sales-tax within the statutory period prescribed for this payment, although the payment so made by them did not fall in the relevant previous year. This was because the sales-tax collected pertained to the last quarter of the relevant accounting year. It could be paid only in the next quarter which fell in the next accounting year. Therefore, even when the sales-tax had in fact been paid by the assessee within the statutory period prescribed for its payment and prior to the filing of the income-tax return, these assessees were unwittingly prevented from claiming a legitimate deduction in respect of the tax paid by them. This was not intended by section 43B. Hence the first proviso was inserted in section 43B. The amendment which was made by the Finance Act, 1987 in section 43B by inserting, inter alia, the first proviso, was remedial in nature, designed to eliminate unintended consequences which may cause undue hardship to the assessee and which made the provision unworkable or unjust in a specific situation.” 3.2 Goodyear India Ltd. v. State of Haryana [1991] 188 ITR 402 where it was held by Apex Court that the rule of reasonable construction must be applied while construing a statute. Literal construction should be avoided if it defeats the manifest object and purpose of the Act. Thus, the impugned addition is based on a misunderstanding of the law, misinterpretation of facts, and mere speculation. It should be entirely deleted. Common Submission-Telescoping /Set off: 1. Benefit of telescoping/set-off deserves to be allowed: Alternatively and without prejudice to our above submissions, the ld. CIT(A) while acknowledging that the ld. AO erred in making double additions w.r.t. addition u/s 68 of Rs. 2,56,03,777/- on account of increase in capital deleted addition of Rs. 17,24,000/- in business income, addition u/s 68 of Rs.18 lakhs as unexplained unsecured loan and also addition u/s 68 of Rs.10 lakhs as unexplained Sundry Creditors. However, the ld. CIT(A) upheld the addition u/s 56(2)(vii)(b)(ii) of Rs. 15,32,337/- being difference in Stamp duty value and declared consideration and also impugned addition of Rs. 38,76,456/- under Income from Other Sources on account of alleged agriculture income. In this context, our submission regarding the sustained addition of Rs. 54,08,793/- (Rs. 15,32,337 + Rs. 38,76,456) merits due consideration. The ld. CIT(A) has failed to account for the fact that the addition of Rs. 54.08 lakhs results in double taxation in as much as Rs. 15,32,337/- is an unexplained investment made in the purchase of the agricultural land towards which, the source in the shape of addition u/s 68 is already available. There apart, the addition of Rs. 38,76,456/- alleged as income from other sources (as against agriculture income) also provide availability of funds which is introduced through the unexplained cash credit u/s 68 of Rs. 2.56 crore. Hence, both these additions (if sustained by the Hon’ble ITAT) are legally required to be set-off against the addition u/s 68 already made and sustained by the CIT(A). Consequently, this part of the CIT(A)'s order warrants modification by deleting both these additions. However, this an alternate argument without any motion or concession w.r.t the correctness or otherwise of these two additions which are separately under challenged. 2. Supporting Case Laws: The issue of telescoping is no more Res Integra and rather a well settled principle because long back in the case of Anantharam Veerasingaiah & Co vs CIT [1980] 3 Taxman 56, the Hon’ble Apex Court has in principle agreed that the undisclosed income in one year will constitute a fund which can be drawn by the assessee later on and can be utilised for acquiring goods or in making investments, etc. and therefore, separate additions on both the counts cannot be made. The Hon’ble jurisdictional High Court in the case of CIT v. Tyaryamal Balchand (1987) 165 ITR 453 (Raj) has also held so, following the aforesaid apex court judgement. GOA-5 Charging of Interest u/s 234A & 234B: It is submitted that such levy is contrary to the provisions of law and hence may kindly be quashed.” 6. To support the contention so raised in the written submission the ld. AR of the assessee filed a detailed paper book containing the following evidence / records : S NO. PARTICULARS Pg NO. 1. Copy of written submissions to AO vide letter dated 23.12.2016 1-3 2. Copy of acknowledgement of speed post to ITO dated 29.12.2016 4 3. Copy of notarized gift deed dated 13.02.2013 in favor of spouse from her Grand Mother, Father and Uncle. 5 4. Copy of notarized gift deed dated 17.03.2013 in favor of assessee from his biological father Shri Nawal Kishore Sharma 6 5. Copy of RC of motor vehicle and vehicle loan statement 10 6. Copy of CIBIL Report of assessee 11-19 7. Copy of list of unsecured lenders 20 8. Copy of notarized affidavits of unsecured lenders 21-40 9. Copy of purchase deed of Kishanpura land dated 10.11.2015 41-51 10. Copy of sale agreement of kacholiya land dated 12.05.2013 52-55 11. Copy of Balance Sheet and Capital Account of assessee For A.Y. 2014-15 56-57 12. Copy of P&L Account of assessee for A.Y. 2014-15 58 13. Copy of Balance Sheet of assessee for A.Y. 2013-14 59 14. Copy of OBC Bank ledger account of assessee for A.Y. 2014-15 60-62 15. Copy of Cash Book of assessee for A.Y. 2014-15 63-66 16. Copy of Balance Sheet of Shri Kalyan Sahay Sharma for A.Y. 2013-14 67 17. Copy of Balance Sheet of Shri Kalyan Sahay Sharma for A.Y. 2014-15 68 18. Copy of purchase deed of Bagrana land dated 13.06.2013 69-77 Ld. AR of the assessee also filed a case law compilation of the case law referred in his written submission S.No. PARTICULARS Pg. No. 1. CIT vs. Taj Borewells (2007) 291 ITR 232 (Mad) 1-9 2. Sheraton Apparels vs. ACIT (2002) 256 ITR 20 (Bom) 10-12 3. Aravali Trading Co. vs. ITO (2008) 8 DTR 199 (Raj) 13-17 4. Amrapali Cinema vs. ACIT, Circle- I, Meerut (2021) 127 taxmann.com 376 (Delhi – Trib) 18-22 5. Ashutosh Bharghav vs. DCIT (2011) 138 TTJ (JP) 479 23-32 6. Andaman Timber Industries vs. CCE, Kolkata-II (2015) 62 33-37 7. The ld. AR of the assessee argued that since the assessee stated in the ITR that no books of account were maintained, any addition based on such alleged books is not valid and are required to be deleted. For that reason he relied upon the provision of section 68 of the Act. He also submitted that considering the nature of income assessee never in past also required to be maintained the books of accounts and statement of affairs cannot be considered as books of accounts. To drive home to this 19. Copy of purchase deed dated 09.01.2014 of Dayarampura Land 78-85 20. Copy of sale deed of land dated 14.03.2013 by Shri Kalyan Sahay Sharma (Father of assessee) 86-97 21. Copy of death certificate of Shri Kalyan Sahay Sharma (Father of assessee) 98 22. Copy of Jamabandi of land of Shri Kalyan Sahay Sharma 99-102 23. Copy of Khasra Girdawari of land of Shri Kalyan Sahay Sharma 103-106 24. Copy of OBC Bank Account of Shri Kalyan Sahay Sharma 107-112 25. Copy of SBBJ Bank Account of Shri Kalyan Sahay Sharma 113-114 26. Copy of Bank Account of assessee 115-119 contention, he relied upon the decision of CIT vs. Taj Borewells (Supra). Ld. AO as well as ld. CIT(A) while confirming the addition made u/s. 68 of the Act has not appreciated that aspect of the matter. Even if the revenue intend to tax the investment so made by the assessee at this stage before the ITAT the revenue once added u/s. 68 of the Act now cannot take a plea to invoke the provision of section 69 of the Act to tax the investment made. The assessee has placed on record all the money trail to explain the investment so made and therefore revenue cannot tax the investment by invoking the provision of section 68 of the Act. When the assessee has established the source, he cannot be expected to prove the source of source. As regards the unsecured loans adopted by the assessee but was added merely based on the statement of that lender without allowing the assessee an opportunity to cross examine Shri Mohan Sharma addition cannot be confirmed [ Reliance was placed on the decision of apex court in the case of Andaman Timber]. As regards the addition made under section 56(2)(vii)(b)(ii) of the Act, the variation being less than 10 % the benefit of revised limit of tolerance be given to the assessee. As regardst the agricultural income the same is revised before the assessment was completed. Alternatively, the benefit of telescoping be given to the assessee. 8. Per contra ld. DR relied upon the orders of the lower authority and vehemently argued that the assessee has revised the balance sheet and he could not substantiate the credit claimed in the balance sheet and therefore, the addition made is in accordance with the provisions of section 68 of the Act. The assessee has not submitted evidence of the amount claimed to be received from the father and thereby claiming the investment benefit is not proper and therefore, ld. DR supported the orders of the lower authority. 9. We have heard both the parties and perused the materials available on record. Ground No. 1 and 6 raised by the assessee are general in nature and do not require any adjudication. Ground no. 5 being the charge of interest as per provision of section 234A/B/C & D of the Act which are consequential in nature and does not require any finding. 10. Ground no. 2 raised by the assessee challenges the confirmation of addition made by the ld. AO u/s. 68 of the Act for an amount of Rs. 2,56,03,777 [ wrongly typed as Rs. 2,58,03,777/- by ld. CIT(A) ] being the amount of alleged increase in capital. The brief fact while making the addition are that the assessee in the assessment proceeding furnished the balance sheet vide submission dated 25.05.2016 wherein the assessee has shown capital of Rs. 2,57,56,456/- which was comparatively too higher as compared to the capital of Rs. 1,52,679/- shown as on 31.03.2013 in the ITR for the A. Y. 2013-14. Therefore, there was an increase in capital of Rs. 2,56,03,777/-. For this additional increase in capital the ld. AR of the assessee filed a detailed explanation stating the complete source for that increase in capital vide his submission filed as reiterated herein above. The major part of the amount the assessee claimed to be from his Step Father. The assessee has on this account has given the source of the source and the ld. AO or that of the ld. CIT(A) did not believe the explanation of the assessee merely on the reason that the assessee at the time of assessment proceedings only stated to have received Rs.1,50,00,000/- from his late father as the source of the purchase of capital assets. Now, he has changed his submissions and has given cash credits to have been received as gifts from his blood relatives, acquaintances and through unsecured loans. Hence, the submission of the appellant not only diverging but are totally unconvincing. The appellant has not submitted the copies of ITRs of the relatives from whom he has received gifts along with their statements of affairs and bank statements to prove the identity, creditworthiness and the genuineness of the transactions. All the documents submitted by the appellant are self-serving and cannot be accepted to have discharged the onus of proving the transactions of cash credits u/s 68 of the Act.(sic) Thus, that observation of the ld. CIT(A) indirectly made it clear that the assessee filed the evidence which he considered it as self-serving document without rebutting those evidence. He do not considered those evidence to be again tested by the ld. AO so as to render the justice to the assessee and had simply stated that the assessee has changed his contention from the gift from father to other relative also. The bench noted that Shri Kalyan Sahay Ji Sharma was a farmer with approximately 10 bigha of land (Land Holding Paper PB99-102). He also cultivated additional land on a sharecropping basis, bringing his total farmed land to around 30-35 bigha annually ( Khasra Girdhawri PB103-106). The agricultural produce was sold in the open market through Aadatiya or directly to consumers. So far as the gift of Rs. 2.10 crores from Shri Sharma to the assessee his father sold his agricultural land located at K. No. 626/3, Village Kanota, The Bassi, Jaipur, on 14.03.2013 to Shri Santosh Kumar Sharma for a total consideration of Rs. 1.50 Cr against sale of Agriculture land (PB 86-97). The said sale proceeds, received through bank by through father and deposited in SBBJ Bank (Bank Statement - PB 114)and thereafter transfer to assessee bank account (OBC Bank Statement- PB 115) were the primary source of the gift to the assessee. The assessee also submitted that his father had capital of Rs. 68,38,632/- as on 01.04.2013, and profit of Rs. 3,12,428.61 earned during the AY 2014-15 (PB67-68). This capital and profit were also used to contribute to the gift and thereby the investment was made by the assessee. Thus, the gift of Rs. 2.10 crores from assessee’s step father cannot be added without ignoring the evidence so placed on record as the assessee has discharged the initial onus casted upon him. We get support to this view of the matter from the decision of our Jurisdictional Hon’ble Rajasthan High Court in the case of CIT v/s Shree Barkha Synthetics (2003) 182 CTR 175 (Raj), wherein the High Court held that ; 14. Since in the context of the aforesaid decisions, the facts of the present case are that the Tribunal has reached its conclusion about the non-inclusion of alleged share application money in the assessee’s income is founded on material before it, which discharged initial burden of the assessee and further enquiry has not been pursued by the Revenue. In these circumstances, it cannot be said that any substantial questions of law arise for consideration in this appeal. 15. The decision relied on by the learned counsel for the appellant in the case of Sophia Finance Ltd. (supra) also does not help the case of the Revenue. A Full Bench decision of Delhi High Court said in that case : \"The mere fact that the (assessee) company chooses to show the receipt of the money as capital does not preclude the Income-tax Officer from going into the question whether this is actually so. Where, therefore, an assessee-company represents that it had issued share on the receipt of share application money then the amount so received would be credited in the books of account of the company. The Income-tax Officer would be entitled, and it would indeed be his duty, to enquire whether the alleged shareholders do in fact exist or not. If the shareholders exist then, possibly, no further enquiry need be made. But if the Income-tax Officer finds that the alleged shareholders do not exist then, in effect, it would mean that there is no valid issuance of share capital. Shares cannot be issued in the name of non-existing persons....\" (p. 98) It is apparent that Full Bench drew the distinction between investment made by persons whose existence have been shown and in which existence has not been established. We have noticed above that the Tribunal has found that 6 out of 7 companies and 9 out of 10 individual investors in share application money of the company have been shown to exist. Thus, the initial burden has been discharged by the assessee. But, as no further enquiry having been held by the Assessing Officer to find genuineness of material by those existing investors, it cannot be made a subject-matter of addition in income of the assessee as unexplained cash credits to the extent such material has come on record. We may notice that in the judgment of Full Bench of Delhi High Court also, it has been reiterated that where the existence of investors cannot be doubted so far as the investment in share capital by them is concerned, no further enquiry can be made. Thus, we note that the assessee discharged initial onus of proving the Identity, Genuineness of the transaction and Capacity of the persons from whom the credit to have been claimed to make the investment which has not been doubted. We also get support of the view of our jurisdictional high court decision in the case of Labhchand Bohra V/s ITO (2008) 8 DTR 44 (Raj.) wherein the High Court held that the assessee cannot called upon to prove the source of the source. Even if the revenue intends to tax it as unexplained investment having not done so u/s 69 and CIT(A) not having invoked that provision even in the first appeal, now we cannot improve the case of the revenue. When revenue taxed under the guise of section 68 of the Act when the assessee proved the initial burden cast upon him under that section. Based on this observation, ground no. 2 raised by the assessee is allowed. 11. Vide ground no. 3 the assessee challenges the addition of Rs. 15,32,337/- made as per provision of section 56(2)(vii)(b)(ii) of the Act. The brief facts related to the dispute are that the assessee purchased two agriculture lands located at Bassi, Jaipur. Ld. AO noted that the assessee has paid purchase consideration less than the Stamp Duty Value or (“SDV/DLC” for short) of the property as contemplated u/s 56(2)(vii)(b)(ii) of the Act. The relevant detail were tabulated at pg. 7 of the Assessment Order and thereby addition for Rs. 15,32,337/- was made the break up of the amount added reads as under: a b c d e f g Sr. No. Address of property Date of purchase Declared Sale Consideration Value Adopted by the sub- registrar Difference (d-e) % of difference (f/e*100) 1. Agricultural land khasra No. 199 of Vill. Kishanpura, Bassi, Jaipur 01.05.2013 55,00,000/- 69,48,411/- 14,48,411/- 20.85% 2. Agricultural land khasra No. 117 of vill. Dayarampura, Bassi, Jaipur 09.01.2014 6,50,000/- 9,33,926/- 83,926/- 8.98% Total 15,32,337/- Based on the above observation addition of Rs. 15,32,337/- was made in total income as per the provision section 56(2)(vii)(b)(ii) of the Act. When the matter carried before the ld. CIT(A) he has confirmed the addition stating that the assessee has not controverted the finding of the ld. AO and therefore, the said addition was confirmed. Before us ld. AR of the assessee submitted that the difference for the property at sr no. 2 being less than 10 % the tolerance limit as revised upto 10 % be applied to retrospective even for the transaction referred herein above and that amendment made vide Finance Act 2020 was held to be retrospective. Even the CBDT in its circular no. 8/2015 stated that in order to minimize hardship in case of genuine transaction in the real estate sector, section 43CA, section 50C and section 56 of the Income-tax Act have been amended to provide that no adjustments shall be made in a case where the variation between stamp duty value and the sale consideration is not more than five per cent of the sale consideration. As regards the property listed at Sr no. 1 the difference being more than 10 % as revised and therefore, considering the specific plea of the assessee that they have not been property opportunity to substantive their defense. Considering that aspect of the matter the bench feels that lis between the parties must be decided on merits so that nobody’s rights could be scuttled down without providing opportunity of being heard to the assessee. Considering that specific prayer of the assessee as regards the property no. 1 listed in the table the matter is restored to the file of the ld. AO who considered the objection on the alleged difference and decide the issue in accordance with law. Based on this observation ground no. 3 is partly allowed. 12. Now coming to the last ground no. 4 raised by the assessee about the agricultural income which was considered in the original return and supported by filling the computation of the income were not considered and thereby the addition of Rs. 38,76,456/- was made as unexplained other source income in the hands of the assessee. The brief facts of the case are that the assessee for the year under consideration has shown agriculture income of Rs 38,76,456/- in his return of income filed on 30.03.2015, In order to verify the genuineness of the declared agriculture income the assessee vide notice u/s 142(1) dated 10.11.2016 was required to furnish the documentary evidence regarding land holding sale bill of crops jamabandi and girdawari report in support of the same. However, despite providing various reasonable opportunities, the assessee has failed to furnish any of the above required details and documents, In the circumstances, the claim of agriculture income remained unverified. Accordingly, the same was treated as unexplained other sources income and added to the total income of the assessee. When the matter carried before the ld. CIT(A) he also confirmed the view of the ld. AO as there also the assessee has not produced any documentary evidence regarding land holding, sale bills of crops, Jamabandi and Girdawari report etc. to support the claim of agricultural income. The bench noted that the only reasons advanced for not considering the income of the assessee under the head agricultural income because the assessee could not support the claim with supporting evidence which was though shown in the original return of income filed. The bench noted that here the claim of the assessee is supported by the original return and thereby filling the revised computation at the time of assessment proceedings thus the claim of the assessee cannot be denied. We get support on this issue from the decision of Hon’ble Gujarat High Court in the case of Principal Commissioner of Income Tax -1, Vs. Babubhai Ramanbhai Patel [ 84 taxmann.com 32 (Gujarat) where in the court has held that ; 6. Sub-section (5) of Section 139, therefore, gives right to an assessee who has furnished a return under sub-section (1) or sub-section (4) to revise such return on discovery of any omission or a wrong statement. Such revised return, however, can be filed before the expiry of one year from the end of the relevant assessment year or before the completion of the assessment, whichever is earlier. This is precisely what the assessee did while exercising the right to revise the return. Sub-section (5) of Section 139 does not envisage a situation whereupon revising the return if a case for loss arises which the assessee wishes to carry forward, the same would be impermissible. In terms, sub-section (5) of Section 139 allows the assessee to revise the return filed under sub- section (1) or sub-section (4) as long as the time frame provided therein is adhered to and the requirement of the revised return has arisen on discovery of any omission or a wrong statement in the return originally filed. Accepting the contention of the revenue would amount to limiting the scope of revising the return already filed by the assessee flowing from sub-section (5). No such language or intention flows from such provision. Considering the overall facts and submission placed on record we direct the assessee to submit all the evidence before the ld. AO and thereby ld. AO shall verify the claim of the assessee with supporting evidence by the assessee. Thus, for this limited purpose of verifying the fact that the income to the extent of Rs. 38,76,456/- is to be charged as agricultural income or the other income. Based on these observations ground no. 4 raised by the assessee is allowed for statistical purpose. In the result appeal of the assessee is partly allowed. Order pronounced in the open court on 17/03/2025. Sd/- Sd/- ¼ Mk0 ,l- lhrky{eh ½ ¼ jkBksM deys'k t;UrHkkbZ ½ (Dr. S. Seethalakshmi) (Rathod Kamlesh Jayantbhai) U;kf;d lnL;@Judicial Member ys[kk lnL;@Accountant Member Tk;iqj@Jaipur fnukad@Dated:- 17/03/2025 *Mishra/ Ganesh Kumar vkns'k dh izfrfyfi vxzsf’kr@Copy of the order forwarded to: 1. The Appellant- Dashrath Kumar Sharma, Jaipur 2. izR;FkhZ@ The Respondent- The ITO, Ward- 7(4), Jaipur. 3. vk;dj vk;qDr@ The ld CIT 4. vk;dj vk;qDr¼vihy½@The ld CIT(A) 5. foHkkxh; izfrfuf/k] vk;dj vihyh; vf/kdj.k] t;iqj@DR, ITAT, Jaipur 6. xkMZ QkbZy@ Guard File (ITA Nos. 647/JP/2024) vkns'kkuqlkj@ By order, lgk;d iathdkj@Asst. Registrar "