INCOME TAX OFFICER, GUNTUR V. ANNAPURNA RAJAVARAPU, GUNTUR

ITA 285/VIZ/2025

AI Insights

The case involves an appeal by the revenue against the order of the Learned Commissioner of Income Tax (Appeals), which had favored the assessee, Annapurna Rajavarapu. The primary issue was the addition of Rs.51,06,33,000/- as unexplained investment by the Assessing Officer, which was later corrected to Rs.1,32,34,500/- based on the Remand Report. The assessee had purchased 43 plots from her husband, and the payments were made through banking channels in subsequent years. The Tribunal agreed with the CIT(A)'s decision to delete the addition, noting that section 69 of the Act, which deals with unexplained investments, did not apply as the transactions were documented and the payments were traceable.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 633673 (ITAT-VISAKHAPATNAM)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-06-2025
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2022-2023
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Unexplained investment
• Section: 143(3); 69

Judgement Text

"आयकर अपीलीय अधिकरण, धिशाखापटणम पीठ, धिशाखापटणम IN THE INCOME TAX APPELLATE TRIBUNAL VISAKHAPATNAM “DIVISION” BENCH, VISAKHAPATNAM श्री िी. दुर्ाा राि, न्याधयक सदस्य, एिं श्री एस बालाक ृष्णन, लेखा सदस्य क े समक्ष BEFORE SHRI V. DURGA RAO, HON’BLE JUDICIAL MEMBER & SHRI S BALAKRISHNAN, HON’BLE ACCOUNTANT MEMBER आयकर अपीलसं./I.T.A. No.285/VIZ/2025 (निर्धारण वर्ा/ Assessment Year: 2022-23) Income Tax Officer Standard House, Nagaramapalem Guntur – 522004, Andhra Pradesh v. Annapurna Rajavarapu Flat No. A2, Srihari Vasam 1/1 Vidya Nagar, Guntur – 522007 Andhra Pradesh [PAN: AFSPR9778M] (अपीलार्थी/ Appellant) (प्रत्यर्थी/ Respondent) करदाता का प्रतततितित्व/ Assessee Represented by : Shri M.C. Rao, CA राजस्व का प्रतततितित्व/ Department Represented by : Dr. Aparna Villuri, Sr. AR सुिवाई समाप्त होिे की ततति/ Date of Conclusion of Hearing : 11.06.2025 घोर्णध की तधरीख/Date of Pronouncement : 12.06.2025 आदेश /O R D E R PER V. DURGA RAO, JM: 1. The captioned appeal is filed by the revenue against order of the Learned Commissioner of Income Tax (Appeals), National Faceless Appeal centre, Delhi [hereinafter in short “Ld.CIT(A)”] vide DIN & Order No. I.T.A. No.285/VIZ/2025 Annapurna Rajavarapu Page No. 2 ITBA/NFAC/S/250/2024-25/1074280074(1) dated 10.03.2025 for the A.Y.2022-23 arising out of order passed under section 143(3) of the Income Tax Act, 1961 (in short ‘Act’) dated 15.03.2024. 2. Brief facts of the case are, assessee is an individual filed her return of income declaring total income of Rs.4,71,600/-. The case was selected for scrutiny under CASS and after following the due procedure assessment was completed on 15.03.2024 under section 143(3) r.w.s. 144B of the Act. In the assessment order, Ld. AO gave a finding that as per the information available with the department, assessee is involved in the purchase of immovable property to the tune of Rs.51,06,33,000/- and the assessee has failed to substantiate the source of purchase with any documentary evidences. Therefore, Ld. AO added the entire amount of Rs.51,06,33,000/- as unexplained investment as per provisions of section 69 of the Act. Assessee has submitted all the details before Ld. AO by stating that she has purchased only 43 vacant residential plots from her husband through three sale deeds. However, Ld. AO not accepted the explanation of the assessee. 3. On appeal, it was submitted before the Ld. CIT(A) that assessee only purchased 43 plots through three Registered Sale deeds amounting to Rs.1,32,34,500/-. The Ld. CIT(A) by considering the submissions, he called for Remand Report from the Ld. AO. In the Remand Report the Ld. AO admitted I.T.A. No.285/VIZ/2025 Annapurna Rajavarapu Page No. 3 that the assessee purchased only 43 plots and observed that on verification of the sale deed document No. 244 / 2022 it is observed the applicant has purchased 15 plots for a consideration of Rs. 47,28,000/- but the amount considered by the Ld.AO in the assessment order was Rs. 7,09,20,000/-. On verification of the sale deed Document No. 246/2022, it is observed that the applicant has purchased 15 plots for a consideration of Rs. 46,06,500/- but the amount considered by the Ld.AO is Rs.6,90,97,500/-. On verification of the sale deed document No. 236/2022, it is observed that the applicant has purchased 13 plots for a consideration of Rs. 39,00,000/- but the amount considered by the Ld. AO is of Rs. 5,07,00,000/-. The Ld. CIT(A) by considering the above, deleted the addition made by the Ld. AO and allowed the appeal filed by the assessee. 4. On being aggrieved, revenue is in appeal before us by raising following grounds of appeal: - “1. Order of the Ld. Commissioner of Income Tax (Appeals), NFAC is erroneous on facts and law. 2. The Ld CIT(A) ought to have uphold the addition of Rs.1,32,34,500/- made by the FAO towards unexplained investment u/s69 of the I.T. Act by considering the factual report submitted by the Assessing Officer that the appellant has purchased 43 plots for a total purchase consideration of Rs.1,32,34,500/-; 3. The Ld.CIT(A) ought to have upheld the addition made by the FAO of Rs.1,32,34,500/- towards unexplained investment u/s.69. of the I.T.Act by appreciating the content mentioned in all the registered purchase deeds which shows that it is agreed by both the purchaser and seller to transfer the property under consideration and also agreed that the corresponding I.T.A. No.285/VIZ/2025 Annapurna Rajavarapu Page No. 4 purchase consideration has been exchanged at the time of registration itself: 4. The Ld.CIT(A) ought to have appreciated that it is only an afterthought of the assessee that she paid the purchase consideration through banking channel in subsequent year, that too, after completion of scrutiny assessment under consideration; 5. The Ld.CIT(A) ought not to have accepted the appellant's contention that her husband agreed to her proposal to make the payment of purchase consideration out of the sale proceeds received by her as and when she sells the said plots in future; 6. The Ld.CIT(A) is not justified in accepting the assessee's claim of alleged evidence in the form of copy of the assessee's ledger account in the books of her husband Sri. Ravi Rajavarapu for the financial years 2021-22 and 2022-23 since it is an afterthought of the assessee to deny the addition made by the FAO towards unexplained investment made u/s.69 of the I.T.Act; 7. The Ld.CIT(A) ought to have upheld the addition made by the FAO of Rs.1,32,34,500/- towards unexplained investment u/s.69 of the I.T.Act by appreciating the action of FAO since the explanation offered by the assessee is not, in the opinion of the Assessing Officer, satisfactory in respect of the value of the investments. 8. Any other ground(s) that may be urged at the time of hearing.” 5. The Ld. Departmental Representative [hereinafter in short “Ld. DR”] submitted that the Ld. AO in the Remand Report noted that addition has to be made in the hands of the assessee of Rs.1,32,34,500/- and submitted that Ld.CIT(A) without considering the Ld. AO’s Remand Report properly deleted the addition. 6. On the other hand, Ld. Authorised Representative [hereinafter “Ld.AR”] submitted that assessee only purchased 43 plots for a sale consideration of I.T.A. No.285/VIZ/2025 Annapurna Rajavarapu Page No. 5 Rs.1,32,34,500/-, all the amounts paid subsequently in 2023-24 as per paper book Page No. 186 and submitted that section 69 of the Act has no application. 7. We have heard both the sides and perused the records and gone to the orders of the authorities below. In this case, the Ld. AO without making any enquiry simply made an addition of Rs.51,06,33,000/-. When the assessee carried the matter before Ld. CIT(A), Ld. CIT(A) called for Remand Report, in that Remand Report the Ld. AO has clearly mentioned that the assessee has purchased only 43 plots for a consideration of Rs. Rs.1,32,34,500/- and the claim of the assessee is genuine. Based on the report given by the Ld. AO, the Ld.CIT(A) deleted the addition made by the Ld. AO. The case of the assessee is that the assessee has purchased 43 plots from her husband for a sale consideration of Rs.1,32,34,500/- which is confirmed by the Ld. AO in the Remand Report. Payments were made subsequently which is evidenced from the paper book page No. 186 and the assessee paid the entire sale consideration as below: Sl.No. Details of purchase documents Date of Payment for cheques to her husband 1. Doc. No. 236/2022 21.08.2024 2. Doc No. 244/2022 30.07.2024 3. Doc. No. 246/2022 29.07.2024 8. In view of the above and by considering the entire facts and circumstances of the case, we are of the opinion that section 69 of the Act has no application in I.T.A. No.285/VIZ/2025 Annapurna Rajavarapu Page No. 6 the present case and we find no reason to interfere with the order passed by the Ld. CIT(A). Accordingly, grounds raised by the revenue are dismissed. 9. In the result, appeal filed by the revenue is dismissed. Order pronounced in the open court on 12th June, 2025. Sd/- (एस बालाक ृष्णन) (S. BALAKRISHNAN) लेखा सदस्य/ACCOUNTANT MEMBER Sd/- (िी. दुर्ाा राि)Sd/- (V. DURGA RAO) न्याधयक सदस्य/JUDICIAL MEMBER Dated : 12/06/2025 Giridhar, Sr.PS आदेशकीप्रनतनलनपअग्रेनर्त/ Copy of the order forwarded to :- 1. निर्धाररती/ The Assessee : Annapurna Rajavarapu Flat No. A2, Srihari Vasam 1/1 Vidya Nagar, Guntur – 522007 Andhra Pradesh 2. रधजस्व/ The Revenue : Income Tax Officer Standard House, Nagaramapalem Guntur – 522004, Andhra Pradesh 3. The Principal Commissioner of Income Tax 4. नवभधगीयप्रनतनिनर्, आयकरअपीलीयअनर्करण, नवशधखधपटणम/DR,ITAT, Visakhapatnam 5. The Commissioner of Income Tax 6. गधर्ाफ़धईल/ Guard file आदेशधिुसधर / BY ORDER Sr. Private Secretary ITAT, Visakhapatnam "