Smt G M Nasreen Taj , Bangalore V. The Income Tax Officer Ward-7(2)(1), Bangalore

ITA 1052/BANG/2018

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 7701 (ITAT-BANGALORE)
• Duration Of Justice: 3 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-07-2018
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2010-2011
• Appeal Filed On: 02-04-2018
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: S VENKATESH
• Assessee Lawyers: SRINIVASAN V
• Keywords: Unexplained investment; Source of fund

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL SMC-B BENCH : BANGALORE BEFORE SHRI ARUN KUMAR GARODIA, ACCOUNTANT MEMBER ITA NO. 1 052/ BANG/201 8 ASSESSMENT YEAR : 20 1 0 - 1 1 SMT. G.M. NASREEN TAJ, TAJ RESIDENCY, #2007, SOUTH END, E CROSS, 26 TH MAIN, 9 TH BLOCK, JAYANAGAR, BANGALORE 560 069. PAN: ADTPN7684D VS. THE INCOME TAX OFFICER, WARD 7 [2] [1], BANGALORE. APPELLANT RESPONDENT APPELLANT BY : SHRI SRINIVASAN V, ADVOCATE RESPONDENT BY : SHRI S. VENKATESH, JCIT (DR) DATE OF HEARING : 02 .0 7 .2018 DATE OF PRONOUNCEMENT : 13 .0 7 .2018 O R D E R PER SHRI A.K. GARODIA, ACCOUNTANT MEMBER THIS APPEAL IS FILED BY THE ASSESSEE WHICH IS DIREC TED AGAINST THE ORDER OF LD. CIT (A)-10, BANGALORE DATED 08.01.2018 FOR ASSESSME NT YEAR 2010-11. 2. THE GROUNDS RAISED BY THE ASSESSEEARE AS UNDER. 1. THE ORDERS OF THE AUTHORITIES BELOW IN SO FAR AS THEY ARE AGAINST THE APPELLANT, ARE OPPOSED TO LAW, EQUITY, WEIGHT O F EVIDENCE, PROBABILITIES, FACTS AND CIRCUMSTANCES OF THE CASE. 2. THE LEARNED CIT[A] IS NOT JUSTIFIED IN UPHOLDING THE ADDITION OF RS. 18,18,750/- MADE AS THE UNEXPLAINED INVESTMENT IN P URCHASE OF THE NEW RESIDENTIAL HOUSE, WHICH WAS EXPLAINED BY THE A PPELLANT FROM OUT OF THE AMOUNTS RECEIVED BY THE APPELLANT FROM THE S ALE OF A HOUSE PROPERTY BELONGING TO HER HUSBAND AND DISBELIEVING THE CONFIRMATION LETTER FURNISHED BY THE APPELLANT AS ADDITIONAL EVI DENCE UNDER THE FACTS AND IN THE CIRCUMSTANCES OF THE APPELLANT'S CASE. 3. WITHOUT PREJUDICE TO THE RIGHT TO SEEK WAIVER WI TH THE HON'BLE CCIT/DG, THE APPELLANT DENIES HERSELF LIABLE TO BE CHARGED TO INTEREST U/S.234-A, 234-B AND 234-C OF THE ACT, WHICH UNDER THE FACTS AND IN THE CIRCUMSTANCES OF THE APPELLANT'S CASE AND THE L EVY DESERVES TO BE ITA NO.1052/BANG/2018 PAGE 2 OF 6 CANCELLED. 4. FOR THE ABOVE AND OTHER GROUNDS THAT MAY BE URGE D AT THE TIME OF HEARING OF THE APPEAL, YOUR APPELLANT HUMBLY PRAYS THAT THE APPEAL MAY BE ALLOWED AND JUSTICE RENDERED AND THE APPELLA NT MAY BE AWARDED COSTS IN PROSECUTING THE APPEAL AND ALSO OR DER FOR THE REFUND OF THE INSTITUTION FEES AS PART OF THE COSTS. 3. IT WAS SUBMITTED BY LD. AR OF ASSESSEE THAT ON P AGE NO. 40 OF THE PAPER BOOK IS THE CONFIRMATION FILED IN RESPECT OF RECEIPT OF RS. 24 LAKHS FROM MRS. TASNEEM S. MALIK. HE FURTHER SUBMITTED THAT ADMITTEDLY, HI S CONFIRMATION WAS NOT FILED BEFORE AO AND IT WAS FILED BEFORE CIT (A) AS ADDITI ONAL EVIDENCE AND LD. CIT (A) ASKED THE AO FOR REMAND REPORT AND THE COPY OF REMA ND REPORT IS AVAILABLE ON PAGES 41 AND 42 OF PAPER BOOK. THEREAFTER, HE SUBMI TTED THAT IN THE REMAND REPORT, THE AO HAS NOT STATED ANYTHING ABOUT THIS C ONFIRMATION AND HE HAS REITERATED THE SAME CONTENTIONS WHICH WERE RAISED B Y HIM IN THE ASSESSMENT ORDER. HE SUBMITTED THAT WHEN THE ASSESSEE HAS FIL ED THE CONFIRMATION THEN THE PERSON SHOULD HAVE BEEN EXAMINED BEFORE REJECTING T HE CONFIRMATION. HE ALSO SUBMITTED THAT THE RELEVANT SALE DEED IS AVAILABLE ON PAGES 25 TO 39 OF PAPER BOOK AND MY ATTENTION WAS DRAWN TO PAGE NO. 31 OF P APER BOOK AND IT WAS POINTED OUT THAT ON THIS PAGE, IT IS STATED IN THE SALE DEED THAT THE WHOLE AMOUNT OF CONSIDERATION OF RS. 25 LAKHS WAS RECEIVED BY TH E VENDOR IN CASH BUT NO DATE IS GIVEN IN RESPECT OF THE RECEIPT OF THE CONS IDERATION BY THE VENDOR. HE POINTED OUT THAT THE DATE OF SALE DEED IS 31.07.200 9 BUT AS PER THE CONFIRMATION OF THE BUYER, RS. 24 LAKHS WAS PAID AS ADVANCE ON 1 2.06.2009 AND THE BALANCE OF RS. 1 LAKH WAS PAID ON 31.07.2009 I.E. O N THE DATE OF SALE DEED AND THEREFORE, THE ASSESSEES CLAIM SHOULD BE ACCEPTED THAT THE AMOUNT PAID BY THE ASSESSEE FOR PURCHASE OF PROPERTY ON 12.06.2009 STA NDS EXPLAINED. THE LD. DR OF REVENUE SUPPORTED THE ORDERS OF AUTHORITIES BELO W. 4. I HAVE CONSIDERED THE RIVAL SUBMISSIONS. I FIND THAT THE ISSUE IN DISPUTE WAS DECIDED BY LD. CIT (A) AS PER PARA 5, 5.1 AND 5.2 O F HIS ORDER AND THEREFORE, THESE PARAS ARE REPRODUCED HEREINBELOW FOR THE SAKE OF READY REFERENCE. 5. DECISION 5.1 I HAVE GONE THROUGH THE RECORDS OF THE CASE AND ALSO HAD A DISCUSSION WITH THE A/R. IN THIS CASE THE APPELLANT HAS BEEN CONTINUOUSLY CHANGING HER STAND FOR THE SOURCE OF R S. 18,18,750/-. FIRST, SHE DECLARED THE SOURCE AS SUNDRY CREDITORS WHICH WAS CHANGED ITA NO.1052/BANG/2018 PAGE 3 OF 6 TO A LOAN FROM HER HUSBAND AND FINALLY ADVANCE RECE IVED FROM MRS. TASNEEM S. MALIK ON 12-06-2009. THE A/R SUBMITTED A CONFIRMATION LETTER FROM MRS. TASNEEM S. MALIK STATING THAT SHE HAS PAID AN ADVANCE OF RS. 24 LAKH ON 12-06-2009 TO MR. SYED HA SSAN AND MRS. NASREEN TAJ FOR PURCHASE OF THE FLAT BEARING NO. D3 , GREEN VIEW, K.V.LAYOUT, 4TH BLOCK, (EAST), 30TH CROSS, JAYANAGA R, BANGALORE. THE FACTS LEADING TO THIS TRANSACTION IS THAT THE APPEL LANT ALONG WITH HER HUSBAND OWNED A PROPERTY AT 4TH BLOCK (EAST), 30TH CROSS, JAYANAGAR, BANGALORE WHICH WAS SOLD TO ONE MRS. TAS NEEM S. MALIK. THIS DEED WAS REGISTERED ON 31-07-2009. HOWEVER, BE FORE SELLING THAT PROPERTY THE APPELLANT PURCHASED A HOUSE PROPERTY W HICH WAS REGISTERED ON 12-06-2009. THE APPELLANT STATES THAT SHE RECEIVED MONEY FROM MRS. TASNEEM AS ADVANCE OF THE PROPERTY SOLD TO HER. IN THIS ENTIRE EPISODE FOLLOWING DISCREPANCIES WERE NO TED: 1. IF THE APPELLANT HAD RECEIVED MONEY FROM THE PUR CHASER OF THE PROPERTY THE SAME COULD NOT HAVE GONE UNNOTICED AND COULD NOT RESULT IN GIVING EXPLANATIONS LIKE SUNDRY CREDITORS AND LO AN FUNDS. 2. IN NORMAL PRACTICE ADVANCE OF THE ENTIRE AMOUNT IS NOT GIVEN FOR PURCHASE OF A PROPERTY. IN THIS CASE IT IS CLAIMED THAT RS. 24 LAKH WAS PAID ON 12-06-2009 AND RS. 1 LAKH WAS PAID ON 31-07 -2009 WHEN THE SALE DEED WAS REGISTERED. 3. AS AGAINST THE ABOVE, THE APPELLANT CLAIMS TO HA VE PAID THE ENTIRE SALE CONSIDERATION ON THE DATE OF THE REGISTRATION OF THE PROPERTY WHICH SHE PURCHASED. NO ADVANCE IS STATED TO BE PAI D. 5.2 FROM THE ABOVE FACTS, IT IS VERY CLEAR THAT THE APPELLANT HAS MADE INVESTMENT FROM UNDISCLOSED SOURCES AND IN ORDER TO HAVE SOME EXPLANATION FOR THE SOURCE OF INVESTMENT SHE HAS FR AMED A STORY WHICH MAY SUIT HER. ONE HAS TO GO BY THE PROBABILITIES OF THE CASE. IN THIS CASE IT IS TO BE MENTIONED THAT THERE IS NO TRANSAC TION THROUGH BANKING CHANNEL AND WHATEVER IS BEING CLAIMED AS THE ALLEGE D TRANSACTION IS ALL THROUGH CASH. THEREFORE, THE STORY OF THE APPEL LANT CANNOT BE RELIED UPON AND IN MY CONSIDERED OPINION THE AO HAS RIGHTL Y REJECTED THE SAME. ACCORDINGLY, I CONFIRM THE ADDITION OF RS. 18,18,75 0/- . 5. FROM THE ABOVE PARAS, IT IS SEEN THAT THE ASSESS EE HAS BEEN CONTINUALLY CHANGING ITS STAND REGARDING THE EXPLANATION IN RES PECT OF THE SOURCE OF RS. 18,18,750/-. INITIALLY IT WAS STATED THAT FIRST, S HE DECLARED THE SOURCE AS SUNDRY CREDITORS WHICH WAS CHANGED TO A LOAN FROM HER HUSB AND AND FINALLY, IT WAS STATED THAT AN ADVANCE WAS RECEIVED FROM MRS. TASNE EM S. MALIK ON 12.06.2009 TO THE EXTENT OF RS. 24 LAKHS ON THAT DA TE. IN THE SUPPORT OF THE FINAL CLAIM, THE ASSESSEE HAS FILED COPY OF SALE DE ED DATED 31.07.2009 AS PER WHICH, THE ASSESSEE HAS SOLD THE PROPERTY TO MRS. T ASNEEM S. MALIK. AS PER ITA NO.1052/BANG/2018 PAGE 4 OF 6 THIS SALE DEED DATED 31.07.2009, THE DETAILS ABOUT THE PAYMENT OF CONSIDERATION BY THE VENDEE TO THE VENDOR BEING THE PRESENT ASSESSEE IS AS PER PAGE NO. 4 OF THE SALE DEED WHICH IS REPRODUCED HER EINBELOW FOR THE SAKE OF READY REFERENCE FROM PAGES 31 AND 33 OF PAPER BOOK. THAT IN PURSUANCE OF THE AFORESAID AGREEMENT AND IN CONSIDERATION OF THE PAYMENT OF RS.25,00,000/- (RUPEES TWENTY FIV E LAKHS ONLY) PAID BY THE VENDEE TO THE VENDORS BY MEANS OF CASH. , WHICH SUM THE VENDORS DOES HEREBY ADMITS AND ACKNOWLEDGES THE REC EIPT OF THE SAME AND IN CONSIDERATION THEREOF THE VENDORS HEREBY GRA NTS, CONVEYS, SELLS, TRANSFERS, ASSIGNS AND ASSURES UNTO AND TO T HE USE OF THE SAID VENDEE ALL THE SCHEDULE 'B' AND 'C' PROPERTIES FREE FROM ALL ENCUMBRANCES, COURT ATTACHMENTS, LITIGATIONS, MAINT ENANCE CHARGES, CLAIMS AND DEMANDS WHATSOEVER TOGETHER WITH ALL THE RIGHTS OF WAY, EASEMENTS OF NECESSITY, WATER, WATER COURSES, DRAIN S, PRIVILEGES, APPURTENANCES, ADVANTAGES WHATSOEVER PERTAINING TO OR BELONGED TO THE SCHEDULE 'B' AND 'C' PROPERTIES, WHO SHALL HOLD POSSESS, USE AND ENJOY ALL THE RIGHT, TITLE AND INTEREST CLAIMS, PAY MENTS OF THE VENDORS AND ALL OTHER RIGHTS, PAYMENTS, PRIVILEGES AND AMEN ITIES BELONGING THERETO TO HAVE AND TO HOLD THE SCHEDULE 'B' AND 'C ' PROPERTIES AND EVERY PART THEREOF TO AND UNTO THE VENDEE ABSOL UTELY AND FOREVER. 6. FROM THE ABOVE PARAS REPRODUCED FROM THE SALE DE ED, IT IS SEEN THAT ALTHOUGH IT IS ADMITTED THAT THE SALE CONSIDERATION OF RS. 25 L AKHS WAS PAID BY THE VENDEE TO THE VENDOR IN CASH BUT WHAT IS THE DATE OF SUCH PAYMENT IS NOT STATED IN THE SALE DEED AND THE SALE DEED IS DATED 31.07.2009. I N THE SALE DEED, THIS IS ALSO STATED AS PER THE PARA REPRODUCED ABOVE THAT THE SA LE DEED IS IN PURSUANCE TO AN AGREEMENT BUT NEITHER THE DATE OF AGREEMENT IS D ISCLOSED NOR THE COPY OF ANY SUCH AGREEMENT IS PRODUCED. AS PER THE CONFIRMA TION FILED BY THE ASSESSEE BEFORE THE CIT (A) AND MADE AVAILABLE BEFORE THE TR IBUNAL ON PAGE 40 OF PAPER BOOK, IT IS STATED THAT OUT OF THIS AMOUNT OF RS. 2 5 LAKHS, RS. 24 LAKHS WAS PAID IN CASH ON 12.06.2009 AND THE BALANCE RS. 1 LAKH WA S PAID BY THE VENDEE TO THE VENDORS ON 31.07.2009. THE CLAIM OF THE ASSESS EE THAT THE VENDEE SHOULD HAVE BEEN EXAMINED BEFORE REJECTING THIS CONFIRMATI ON HAS TO BE LOOKED INTO IN THE LIGHT OF THIS FACTUAL POSITION ALSO THAT THE AS SESSEE IS REGULARLY CHANGING HER STAND. FIRST THIS WAS THE CLAIM OF THE ASSESSEE TH AT THE AMOUNT IN QUESTION IS FINANCED OUT OF SUNDRY CREDITORS. THEREAFTER THE S TAND WAS CHANGED AND IT WAS STATED THAT THE SAME IS FINANCED OUT OF UNSECURED L OAN FROM THE HUSBAND OF THE ASSESSEE. AS PER THE STATEMENT OF AFFAIRS AS ON 31 .03.2010 AVAILABLE ON PAGE ITA NO.1052/BANG/2018 PAGE 5 OF 6 24 OF PAPER BOOK, THERE IS CAPITAL OF RS. 12,66,730 /-, UNSECURED LOAN OF RS. 18,18,750/- AS THE SOURCE OF FUND TO THE TOTAL ASSE T OF RS. 30,85,480/- AND ADVANCE SALE CONSIDERATION IS N OT APPEARING. IN THE ASSET SIDE ALSO, THERE ARE ONLY THREE ASSETS I.E. FLAT PU RCHASED ON 12.06.2009 FOR RS. 25,13,750/-, CURRENT ASSETS AND DEPOSITS OF RS. 5.5 0 LAKHS AND CASH AND BANK BALANCES OF RS. 21,730/- TOTAL ASSETS OF RS. 30,85, 480/-. THEREAFTER, THE STAND WAS CHANGED AGAIN BEFORE CIT (A) AND IT WAS STATED THAT THE ASSESSEE HAS SOLD THE PROPERTY TO MRS. TASNEEM S. MALIK ON 31.07.2009 FOR CONSIDERATION OF RS. 25 LAKHS AND IT IS CLAIMED THAT OUT OF THIS SALE CO NSIDERATION OF RS. 25 LAKHS, RS. 24 LAKHS WAS RECEIVED BY CASH IN ADVANCE ON 12. 06.2009 AND BALANCE RS. 1 LAKH WAS RECEIVED ON 31.07.2009, COPY OF SUCH SAL E DEED DATED 31.07.2009 IS MADE AVAILABLE ON PAGES 25 TO 39 OF PAPER BOOK. IF THE ASSESSEES CLAIM IS CORRECT THEN THERE SHOULD HAVE BEEN EITHER CAPITAL GAIN OR CAPITAL LOSS ON THE SALE OF THIS PROPERTY BUT IT IS SEEN THAT NEITHER A NY CAPITAL GAIN IS OFFERED FOR TAXATION NOR ANY CAPITAL LOSS HAS BEEN REPORTED.ON PAGE NO. 24 OF PAPER BOOK IS THE COPY OF CAPITAL ACCOUNT AND IN THE SAME ALSO , NEITHER ANY INCOME ON SALE OF PROPERTY IS SHOWN NOR ANY LOSS ON SALE OF PROPER TY IS SHOWN. BEFORE THE TRIBUNAL, THE STATEMENT OF AFFAIRS AS ON 31.03.2009 HAS ALSO NOT BEEN BROUGHT ON RECORD TO SHOW THAT THE SAID PROPERTY FOR SALE O F WHICH THE ASSESSEE IS CLAIMING RECEIPT OF ADVANCE IS SHOWN IN SUCH A BALA NCE SHEET AS AN ASSET OF THE ASSESSEE. IN THE WRITTEN SUBMISSIONS WHICH ARE AVA ILABLE ON PAGES 1 TO 3 OF PAPER BOOK, IT IS STATED THAT THE SAID PROPERTY WAS PURCHASED BY THE ASSESSEE ALONG WITH HER HUSBAND MR. SYEED HASSAN AND THE SAI D PROPERTY WAS DISCLOSED IN THE BALANCE SHEET IN THE ASSESSEES HUSBAND FOR THE YEAR ENDED 31.03.2006. THIS IS ALSO VERY SURPRISING THAT WHEN THE PROPERTY IS OWNED BY THE HUSBAND OF THE ASSESSEE HOW THE ASSESSEE WILL RECEIVE THE WHOL E AMOUNT OF CONSIDERATION OF RS. 25 LAKHS. EVEN THE BALANCE SHEET OF THE HUS BAND OF THE ASSESSEE FOR THE YEAR ENDING ON 31.03.2006 OR 31.03.2007 OR 31.0 3.2008 OR 31.03.2009 HAS NOT BEEN BROUGHT ON RECORD TO SHOW THAT THE PROPERT Y IN QUESTION WAS SHOWN IN THE BALANCE SHEET OF THE HUSBAND OF THE ASSESSEE. THE BALANCE SHEET OF THE HUSBAND OF THE ASSESSEE FOR ASSESSMENT YEAR 2010-11 IS ALSO NOT BROUGHT ON RECORD TO SHOW THAT THE CAPITAL GAIN/LOSS ON SALE O F THE PROPERTY WAS DISCLOSED IN HIS BALANCE SHEET FOR THE YEAR ENDED 31.03.2010. CONSIDERING ALL THESE ITA NO.1052/BANG/2018 PAGE 6 OF 6 FACTS, I FIND NO REASON TO INTERFERE IN THE ORDER O F CIT(A) AND I FEEL THAT IN THE FACTS OF THE PRESENT CASE, THERE IS NO MERIT IN THE CLAIM OF THE LEARNED AR OF THE ASSESSEE THAT IN VIEW OF THE CONFIRMATION, MRS. T ASNEEM S. MALIK SHOULD HAVE BEEN EXAMINED BEFORE IGNORING THE CONFIRMATION BECA USE I FIND THAT WHEN THE ASSESSEE IS ADMITTEDLY NOT OWNING THE ASSET IN QUES TION AS A BENEFICIAL OWNER THAN HOW THE ASSESSEE IS EXPECTED TO RECEIVE THE AD VANCE FOR SALE OF THAT PROPERTY AND EVEN IF ANY ADVANCE IS GIVEN BY THE VE NDEE, IT WILL GO THE BENEFICIAL OWNER I.E. THE HUSBAND OF THE ASSESSEE A ND THEREFORE, EXAMINATION OF THE VENDEE IS NOT RELEVANT. IN THE SAID CONFIRMATIO N ALSO AVAILABLE ON PAGE 40 OF THE PAPER BOOK, IT IS NOT STATED THAT THE MONEY WAS GIVEN TO THE ASSESSEE. IN FACT, IN THAT CONFIRMATION, IT IS STATED THAT THE M ONEY WAS GIVEN TO MR. SYED HASSAN AND MRS. NASREEN TAJ. HENCE, THIS CONFIRMATI ON DOES NOT HELP THE ASSESSEE AND HENCE, EXAMINATION OF VENDEE IS NOT RE QUIRED. 7. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON THE DA TE MENTIONED ON THE CAPTION PAGE. SD/- (ARUN KUMAR GARODIA) ACCOUNTANT MEMBER BANGALORE, DATED, THE 13 TH JULY, 2018. /MS/ COPY TO: 1. APPELLANT 4. CIT(A) 2. RESPONDENT 5. DR, ITAT, BANGALORE 3. CIT 6. GUARD FILE BY ORDER SENIOR PRIVATE SECRETARY, INCOME TAX APPELLATE TRIBUNAL, BANGALORE.