Dharam Chand Jain, Hyd, Hyderabad V. ACIT, Central Circle-3, Hyd, Hyderabad

ITA 1177/HYD/2016

• Counselvise Citation: [2021] 109 COUNSELVISE.COM (IT) 6632 (ITAT-HYDERABAD)
• Duration Of Justice: 4 year(s) 4 month(s) 20 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-01-2021
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB-A
• Next Hearing Date: 18-01-2021
• Assessment Year: 2004-2005
• Appeal Filed On: 09-09-2016
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Unexplained investment; Additional evidence; Retraction
• Section: 143(3); 153A; 69B

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCHES : BENCH A HYDERABAD (THROUGH VIDEO CONFERENCE ) BEFORE SHRI S ATBEER SINGH GODARA, JUDICIAL MEMBER AND SHRI LAXMI PRASAD SAHU, ACCOUNTANT MEMBER I.T.A. NO. 1177/ HYD./201 6 ASSESSMENT YEAR : 2004 - 05 SHRI DHARAM CHAND JAIN VS. ADDL. CIT, HYDERABAD CENTRAL CIRCLE 3 HYDERABAD PAN: AAACI4487J (APPELLANT) (RESPONDENT) FOR ASSESSEE: SRI K.C. DEVDAS, A.R. FOR REVENUE: SRI ASHOK KUMAR KARDAM, D.R. DATE OF HEARING : 18/01/2021 DATE OF PRONOUNCEMENT : 29 /01/2021 O R D E R PER BENCH THIS ASSESSEES APPEAL FOR A.Y. 2004 - 05 ARISES FROM COMMISSIONER OF INCOME TAX (APPEALS) - 12 [CIT(A)], HYDERABAD S ORDER DATED 27.05.2016 PASSED IN CASE NO. 0212 /20 14 - 15 INVOLVING PROCEEDINGS U/S 143(3) R.W.S. 153A OF THE INCOME TAX ACT, 1961 (IN SHORT THE ACT). HEARD SRI K.C. DEVDAS REPR ESENTING THE DECEASED ASSESSEES LEGAL REPRESENTATIVES AND SHRI ASHOK KUMAR KARDAM , CIT,DR APPEARING ON REVENUES BEHALF. CASE FILE PERUSED. 2. THE ASSESSEE S SOLE SUBSTANTIVE GROUND RAISED IN THE INSTANT APPEAL CHALLENGES THE CORRECTNESS OF BOTH THE LOWER AUTHORITIES ACTION ADDING A SUM ITA NO. 1177 /HYD/ 2016 AY 2004 - 05 LATE DHARAM CHAND JAIN, LEGALLY REPRESENTED BY: SMT.KAMAL CHORDIA ALIAS KAMAL JAIN (WIFE) & MR. SHASHWAT JAIN (SON) 2 OF RS.5,00,000/ - AS UNEXPLAINED INVESTMENT IN THE COURSE OF ASSESSMENT AS UPHELD IN CIT(A)S ORDER VIDE FOLLOWING DETAIL ED DISCUSSION. 5.0. ADDITION TOWARDS UNEXPLAINED INVESTMENT OF RS.5,00,000/ - : DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE AO HAD OBSERVED THAT THE ASSESSEE THOUGH ADMITTED AN AMOUNT OF RS. 5,00,000/ - DURING THE SEARCH PROCEEDINGS AS UNEXPLAINED INCOME, HAS NOT ADMITTED THE SAME IN THE RETURN OF INCOME FILED FOR A.Y.2004 - 05 . WHEN THE ASSESSEE WAS ASKED TO EXPLAIN THE SAME DURING THE ASSESSMENT PROCEEDINGS, THE ASSESSEE FILED THE REPLY WHEREIN, IT WAS SHOWN TO HAVE STATED THAT; (I) THE AGREEMENT OF SALE WAS FOUND IN THE FACTORY PREMISES AND THE STATEMENT WAS RECORDED ON THE SAME DAY AT HIS RESIDENCE WITHOUT SHOWING HIM THE ACTUAL DOCUMENT. ( II) THE AGREEMENT IS DATED 11TH SEPTEMBER, 2003 WHEREAS THE STAMP PAPER IS PURCHASED ON 17TH SEP TEMBER, 2003, AND ITSELF EXPLAINS THAT THE DOCUMENT IS NOT A VALID DOCUMENT. (III) ASSESSEE HAS NOT SIGNED THE AGREEMENT. (IV) SIX FAMILY MEMBERS HAVE GIVEN HIM MONEY TO NEGOTIATE FOR THE PROPERTY AND IT WAS REITERATED THAT AS THERE IS TIME LAPSE, HE DID NOT REMEMBER THE SAID DETAILS AND DEPOSED SO, DURING SEARCH PROCEEDINGS. 5.1.1. THE ARGUMENTS PUT FORTH BY THE ASSESSEE WERE NOT ACCEPTABLE TO THE ASSESSING OFFICER, FOR THE REASONS THAT THE ASSESSEE HAD ADMITTED THE AMOUNT OF RS.5,00,000J - AS UNEXPLAINED INVESTMENT WHICH WAS PAID AS AN ADVANCE FOR PURCHASE OF 0.28 GUNTAS OF LA ND SITUATED AT THIMMAPUR (V), KOTHUR (M), MAHABOOBNAGAR DIST., WHICH HAS NOT BEEN RECORDED IN THE BOOKS OF ACCOUNTS AND THE ASSESSEE HAS NOT DECLARED THE SAME IN THE RETURN OF INCOME FILED FOR THE AY 2004 - 05. ACCORDINGLY, THE ADVANCE OF RS.5,00,000 / - PAID AS PER THE AGREEMENT OF SALE FOUND DURING SEARCH PROCEEDINGS, HAS BEEN TREATED AS UNEXPLAINED INVESTMENT IN THE HANDS OF THE ASSESSEE, AS PER THE PROVISIONS OF SECTION 69B OF THE I.T.ACT. AS SUCH, THE SAME AMOUNT HAS BEEN ADDED TO THE INCOME DECLARED BY TH E ASSESSEE. ITA NO. 1177 /HYD/ 2016 AY 2004 - 05 LATE DHARAM CHAND JAIN, LEGALLY REPRESENTED BY: SMT.KAMAL CHORDIA ALIAS KAMAL JAIN (WIFE) & MR. SHASHWAT JAIN (SON) 3 5.2. THE APPELLANT OBJECTED FOR SUCH ADDITION AND IT HAS BEEN SUBMITTED THAT THE STATEMENT RELIED UPON BY THE ASSESSING OFFICER WAS RECORDED AT THE RESIDENCE, WITHOUT SHOWING THE AGREEMENT FOR SALE OF PROPERTY WHICH WAS FOUND AND SEIZED FROM FACTORY PREMISES THEREBY THE APPELLANT WAS NOT IN THE KNOWLEDGE OF THE DOCUMENT UNDER REFERENCE. IT WAS ALSO SUBMITTED THAT WHILE THE AGREEMENT WAS DATED 11 - 9 - 2013, THE DATE OF PURCHASE OF STAMP PAPER WAS DATED 17 - 9 - 2013 AND SUCH AGREEMENT WAS NOT SIGNED BY HIM. IT WAS ALSO CONTENDED BY THE ASSESSEE THAT AT THE TIME OF RECORDING OF STATEMENT HE WAS ONLY QUESTIONED ON THE NON - RECORDING OF TRANSACTION IN BOOKS BUT NO SOURCES WERE EXAMINED AND THE SOURCES FOR SUCH AMOUNTS ARE PROVIDED BY FAMILY MEMBERS, FROM THEIR FUNDS AND ALL THESE EXPLANATIONS WERE NOT ACCEPTED BY THE ASSESSING OFFICER, ONLY ON THE GROUND THAT THE SAME AMOUNTED TO AN AFTERTHOUGHT. IT WAS FURTHER CONTENDED THAT WHEN THE SOURCES WERE NOT DISPUTED BY THE ASSESSING OFFICER, THE SAME COULD NOT B E TREATED AS UNEXPLAINED INVESTMENT. 5.3. PERUSED THE SUBMISSIONS OF THE APPELLANT AND THE OBSERVATIONS AS WELL AS THE FINDINGS OF THE ASSESSING OFFICER, IN ASSESSMENT ORDER. AS COULD BE MADE OUT FROM THE FACTS OF THE CASE, THE AGREEMENT FOR SALE DATED 11 - 9 - 2003, FOR PURCHASE OF LAND ADMEASURING 28 GUNTAS LOCATED AT THIMMAPUR (V) AT THE RATE OF RS.18.50 LAKHS PER ACRE, WAS FOUND DURING SEARCH PROCEEDINGS CONDUCTED IN THE CASE OF THE ASSESSEE GROUP, MORE PRECISELY AT THE FACTORY PREMISES AND THE INFORMATI ON WAS FURTHER INDICATING THE PAYMENT OF RS.5,00,000 / - BY SRI DHARAM CHAND, AS AN ADVANCE TOWARDS THE SAID PURCHASE AND ON EXAMINATION FOR THE SOURCES, IT WAS ACCEPTED BY THE ASSESSEE THAT NO SUCH AMOUNTS WERE RECORDED IN BOOKS, AS SUCH ACCEPTED AS AN UNEX PLAINED INVESTMENT. HOWEVER, THE SAME WAS NOT ADMITTED IN THE RETURN OF INCOME, WHICH AMOUNTED TO RETRACTION OF THE STATEMENT, SUBSEQUENTLY, ON THE GROUND THAT THE AUTHORITIES HAVE NEVER EXAMINED THE SOURCES FOR THE SAME, EXCEPT TO ENQUIRE WHETHER IT WAS R ECORDED IN BOOKS OF ACCOUNT OR NOT, AND THE SOURCES FOR SUCH PAYMENT WERE SHOWN TO BE THE CONTRIBUTIONS FROM THE OTHER FAMILY MEMBERS, FROM THEIR EXPLAINABLE SOURCES. IT WAS ALSO ARGUED AND CONTENDED ITA NO. 1177 /HYD/ 2016 AY 2004 - 05 LATE DHARAM CHAND JAIN, LEGALLY REPRESENTED BY: SMT.KAMAL CHORDIA ALIAS KAMAL JAIN (WIFE) & MR. SHASHWAT JAIN (SON) 4 BY THE ASSESSEE THAT SUCH TRANSACTION HAS NOT GONE TH ROUGH AND THE ADVANCES PAID WERE RETURNED. IT WAS FURTHER CONTENDED AND CONTESTED THAT THE ASSESSEE WAS NOT AWARE OF THE CONTENTS OF THE SAID AGREEMENT, SINCE THE SAME WAS FOUND AT FACTORY PREMISES WHEREAS THE STATEMENT HAS BEEN RECORDED AT HIS RESIDENCE. IT WAS ALSO CONTESTED THAT THE RELIABILITY OF THE SALE DEED IS QUESTIONABLE WITH THE DATE OF STAMP PAPER SHOWN AS 17 - 9 - 20P3, WHEREAS THE AGREEMENT WAS DATED 11 - 9 - 2003 I.E. AGREEMENT WAS PRIOR TO THE DATE OF PURCHASE OF STAMP PAPER. 3. MR.DEVDAS VEHEMENTLY CONTENDED DURING THE COURSE OF HEARING THAT THE ASSESSING OFFICER AS WELL AS THE COMMISSIONER OF INCOME TAX (APPEALS) HAVE ERRED IN LAW AND ON FACTS IN MAKING IMPUGNED ADDITION TOWARDS UNEXPLAINED INVESTMENTS THEREBY STATING ASSESSEES FAILURE IN PROVING THE SOURCE THEREOF. HE HAS FILED A MULTIPLE SET OF PAPER BOOK ( S ) AS WELL AS A PPLICATION SEEKING ADMISSION OF ADDITIONAL EVIDENCE THAT ASSESSEE HAD IN FACT RECEIVED THE IMPUGNED SUM OF RS.5,00,000/ - FROM HIS FAMILY MEMBER/BROTHERS AND NOW HIS LEGAL REPRESENTATIVES WOULD BE ABLE TO PROVE THE SAME IN CASE THEY ARE GRANTED ONE MORE OPPORTUNITY BEFORE THE ASSEESSING OFFICER. 4. WE HAVE GIVEN OUR THOUGHTFUL CONSIDERATION TO RIVAL PLEADINGS AGAINST AND IN SUPPORT OF IMPUGNED ADDITION. WE FIND NO MERIT TO ACCEPT ASSESSEES FOREGOING REQUEST FOR ADMISSION OF ADDITIONAL EVIDENCE. THE CLINCHING FACT THAT REMAINS IS THAT THE IMPUGNED A.Y. 2004 - 05 INVOLV ES THE SEARCH IN QUESTION DATED 18..6.2008 . W E NOTICE THAT RIGHT FROM THE ASSESSEES SEARCH STATEMENT RECORDED U/S 132(4) OF THE ACT TILL THE LOWER APPELLATE ORDER DATED 25.02.2016, HE HA D NOT GIVEN EVEN A SINGLE PARTYS NAME DURING ALL THIS INTERVENING PERIOD. THERE IS FURTHER NO INDICATION AS TO HOW ALL TH ESE ADDITIONAL EVIDENCES H AVE SEEN LIGHT OF THE DAY DURING THE INSTANT SECOND APPELLATE PROCEEDINGS. WE THUS DO NOT SEE ANY MERIT IN BOTH SUBSTANTIVE GROUNDS AS WELL AS IN ADDITIONAL EVIDENCE APPLICATION SEEKING TO DELETE THE IMPUGNED UNEXPLAINED INVESTMENT ADDITION. WE ALSO WI SH TO OBSERVE THAT THIS ITA NO. 1177 /HYD/ 2016 AY 2004 - 05 LATE DHARAM CHAND JAIN, LEGALLY REPRESENTED BY: SMT.KAMAL CHORDIA ALIAS KAMAL JAIN (WIFE) & MR. SHASHWAT JAIN (SON) 5 IS AN INSTANCE WHERE THE ASSESSEE/HIS L EGAL REPRESENTATIVES HAVE SOUGHT TO PROJECT AN ALTOGETHER NEW CASE BY SUBMITTING A LIST OF BROTHERS/FAMILY MEMBERS WHICH WAS NEVER PLACED ON RECORD EARLIER. WE ACCORDINGLY REJECT ALL OF ASSESS EES PLEADINGS. THE IMPUGNED ADDITION IS CONFIRMED. THIS A SSESSEES APPEAL IS DISMISSED. PRONOUNCED IN OPEN COURT ON 29 TH JANUARY, 2021. SD/ - SD/ - (LAXMI PRASAD SAHU) (S ATBEER SINGH GODARA) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: THE 29 TH JANUARY, 2021. * GM V COPY OF THE ORDER FORWARDED TO: 1. LATE DHARAM CHAND JAIN REPRESENTED BY L.RS. : KAMAL CHORDIA AND MR.SHASHWAT, 1 - 4 - 6 - 86, CHUDI BAZAR, BEGUM BAZAR, NAMPALLY, HYDERABAD , TELANGANA 2. A CIT, CENTRAL CIRCLE 3 , HYDERABAD 3. ACIT, RANGE 3 , HYDERABAD. 4. CIT(A) - 1 2, HYDERABAD. 5. PR.CIT (CENTRAL), HYDERABAD 6. DR, ITAT, HYDERABAD. 7. GUARD FILE.