Shri Aiyubkhan Doulatkhan Pathan, Ahmedabad V. The ITO, Ward-1(1)(3), Ahmedabad

ITA 1384/AHD/2019

AI Insights

The case involves cross-appeals by both the assessee, Shri Aiyubkhan Doulatkhan Pathan, and the Income Tax Officer (ITO), Ward-1(1)(3), Ahmedabad, against the order of the Commissioner of Income-Tax (Appeals)-1, Ahmedabad. The primary issues revolved around the classification of agricultural land as a 'capital asset' and the applicability of section 50C of the Income Tax Act, 1961, which pertains to the taxation of capital gains. The assessee argued that the land sold did not qualify as a capital asset and thus should not attract capital gains tax, while the Revenue contested the CIT(A)'s allowance of certain exemptions under section 54B and the deletion of additions under section 68.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 133598 (ITAT-AHMEDABAD)
• Duration Of Justice: 4 year(s) 2 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-11-2023
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 07-08-2023
• Assessment Year: 2012-2013
• Appeal Filed On: 29-08-2019
• Other Referred Cases: Pr CIT v/s Khetilal Sharma (HUF), ITO v/s Akash Deep Farms P. Ltd, Shri Dashratbhai Gopalbhai Patel, CIT v/s Murali Lodge, ITO v/s Shri Adela Krishna Reddy, CIT(A) v/s Nitish Rameshchandra Chordia, CIT Vs. Aayachi Chandrashekhar Narsangi, CIT Vs. Rohini Builders
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Sale consideration of property below Jantri Value; Capital asset; Source of fund; Set aside; Capital Gains
• Section: 68; 54B; 50C; 13

Judgement Text

आयकर अपीलीय अिधकरण आयकर अपीलीय अिधकरणआयकर अपीलीय अिधकरण आयकर अपीलीय अिधकरण, अहमदाबाद 瀈यायपीठ अहमदाबाद 瀈यायपीठअहमदाबाद 瀈यायपीठ अहमदाबाद 瀈यायपीठ ‘C’ अहमदाबाद। अहमदाबाद।अहमदाबाद। अहमदाबाद। IN THE INCOME TAX APPELLATE TRIBUNAL “C” BENCH, AHMEDABAD ] ] BEFORE SMT.ANNAPURNA GUPTA, ACCOUNTANT MEMBER AND SMT. MADHUMITA ROY, JUDICIAL MEMBER, JUDICIAL MEMBER ITA No.1384/Ahd/2019 Assessment Year : 2012-13 Shri Aiyubkhan Doulatkhan Pathan 64, Prachina Society Nr. Samir Vihar Society Juhapura Sarkhej Road Ahmedabad. PAN : AGHPP 3458 Q Vs. ITO, Ward-1(1)(3) Ahmedabad. ITA No.1472/Ahd/2019 Assessment Year : 2012-13 ITO, Ward-1(1)(3) Ahmedabad. Vs. Shri Aiyubkhan Doulatkhan Pathan 64, Prachina Society Nr. Samir Vihar Society Juhapura Sarkhej Road Ahmedabad. PAN : AGHPP 3458 Q 0 अपीलाथ / (Appellant) यथ /(Respondent) Assessee by : Shri Hiren Shah on behalf of Shri Jignesh Parikh, AR Revenue by : Written Application स ु नवाई क तार ख/Date of Hearing : 08/08/2023 घोषणा क तार ख /Date of Pronouncement: 07/11/2023 आदेश/O R D E R PER ANNAPURNA GUPTA, ACCOUNTANT MEMBER Assessee and the Revenue, both are in cross-appeals against order passed by the ld.Commissioner of Income-Tax(Appeals)-1, Ahmedabad [hereinafter referred to as “ld.CIT(A)”] dated 01.7.2019 ITA No.1384 and 1472/Ahd/2019 2 under section 250(6) of the Income Tax Act, 1961 ("the Act" for short)pertaining to Asst.Year 2012-13. 2. The grounds raised by the assessee are as under: i) That on facts, and in law, the learned CIT(A) has grievously erred in confirming the addition made towards capital gains of Rs.1,04,48,973/-. ii) That on facts, in law, and on evidence on record, it ought to have been held that the agricultural land sold is not a capital asset and , the entire addition ought to have been deleted, as prayed for. iii) That on facts and in law, the learned CIT(A) has grievously erred in confirming the action of the AO in applying the provisions of section 50C of the Act while computing the addition of capital gains.” And the grounds raised by the Revenue in its appeal are as under: (1) The Id. CIT(A) has erred in direction the AO to verify and allow the claim u/s 54 by ignoring that (i) assessee had not made the claim u/s 58 in return of income, (ii) Section 54B deduction is allowed only if the land is used for agricultural purposes, (Hi) Section 54B envisages that in the 2 immediate preceding years, the assessee should have used the land for agricultural purposes which is not satisfied in this case as the lands have been purchased in one financial year and sold in immediate next financial year. (2) The Id. CIT(A) has erred in deleting the additions made u/s 68 of Rs.64,85,000/- + Rs.2,63,00,000/- + Rs.3,34,50,000/- aggregating Rs.6,62,35,000/- without appreciating the discrepancies and findings given by the AO in the remand report in the right perspective. (3) It is, therefore, prayed that the order of Id. CIT(A) may be set aside and that of the Assessing Officer be restored. 3. As is evident from the above, ground no.1 to 3 raised by the assessee, and ground no.1 raised by the Revenue relate to the issue of addition made to the income of the assessee by the AO on account of capital gain earned on sale of land, amounting to Rs.1,04,48,973/-. The assessee had claimed the said land as not qualifying as “capital asset” being a rural agricultural land in terms of section 2(14)(iii) of the Act and hence had not returned any capital gains on sale of the said asset. However, the AO rejected this ITA No.1384 and 1472/Ahd/2019 3 contention of the assessee treating the land as not qualifying in the exception provided in section 2(14)(iii) of the Act, and accordingly subjected to the gain thereon to tax. The AO, thereafter applied the provisions of section 50C of the Act substituting theconsideration actually received by the assessee with the stamp duty value thereon, and the assessee’s claim of exemption of capital gain under section 54B of the Act on account of investment of capital gains in agriculture land was rejected by the AO. 4. The ld.CIT(A) though confirmed order of the AO treating the land as capital asset, and also application of provisions of Section 50C of the Act to the impugned transaction, however, on the aspect of claim of exemption of the asset under section 54B of the Act, he allowed the claim of the assessee. Accordingly, the assessee is in appeal before us against the order of theld.CIT(A) treating the impugned land as capital asset and applying section 50C of the Act for the purpose of computing the capital gains thereon, which issues have been raised in ground no.1 and 3 of its appeal, while the Revenue is against allowance of claim of exemption to the assessee of the capital gains under section 54B of the Act raised in ground no.1 of its appeal. 5. Since the issues raised by the assessee in its appeal and the Revenue in ground no.1 are inter-connected, we shall deal with all of them together in this order. Since the assessee has challenged the addition made of capital gains on the preliminary aspect i.e. the impugned land is not qualified as “capital asset”, we shall first adjudicate this issue. ITA No.1384 and 1472/Ahd/2019 4 6. As transpires from order of the authority below, the assessee’s contention for the asset not qualifying as “capital asset” is that the land was situated beyond limits prescribed under section 2(14)(iii) of the Act to qualify as capital asset. The contentionof the Revenue, on the other hand, is otherwise. The assessee has sold two pieces of land during the year – (i) situated in Gam Telav, Ta. Sanand, and (ii) land at Gam Sanathal, Ta. Sanand. The assessee had contended that the lands fell in the exception provided u/s 2(14)(iii) of the Actbeing situated beyond 8 Kms. from the Ahmedabad Municipal Corporation and had measured the distance as per Google Map and based on certificate of Dy. Engineer, Roads & Building Department. The assessee had submitted that boththe land are located under Sanand Taluka, and are located beyond 2 Kms. from thelocal limit of Sanand, and therefore, as per the Notification No.SO-9447 (F.No.164/3-ITA-I dated 6.1.1994, they are not urban agricultural land. The assessee had also submitted Google Map and letter of Dy.Engineer, Road & Building Department, reporting distance beyond 8 Kms. from the limit of the AMC and beyond 2 Kms. from the Sanand Municipality. The facts relating to the measurement of distance furnished by the assessee from the Google Map and certificate of the Dy. Engineer are as under: Measurement of Distance Further the distance of Land is as under; Land at Distance as per Google Map Page Reference Ahmedabad Sannand Tefav 183 KMs 6.2 KMs Page 7 & 8 of CtT Appeal Order Sanathal 13.5 KMs 11.6 KMs ITA No.1384 and 1472/Ahd/2019 5 Distance based on Certificate of Deputy Engineer Road and Building Department Dated 08.05.2019. Distance from Ahmedabad to Telav 16 KMs Page 7 & 8 of C)TAppea 1 Order 7. The ld.AO, whose order was confirmed by the ld.CIT(A) however found the villages in which the land was situated i.e. Village Telav and Sanathal to be included in the Ahmedabad Urban Development Authority (AUDA) vide Notification dtd. 30.1.1978, and therefore held that they were situated within 8 Kms. of the AMC, and the population of the village exceeding as per the last census being more than 10,000, the land qualified as capital asset. His relevant findings in this regard are at para 4.6 ofthe order as under: ITA No.1384 and 1472/Ahd/2019 6 8. The contention of the assessee before us was that - - as per section 2(14)(iii) of the Act, the distance is to be determined from the municipal limit and AUDA did not qualify as municipality or municipal corporation - that even otherwise distance from the municipality or municipal corporation has to be seen as on the date of notification specifying the limits dated 6.1.1994. Reference was made to the Explanation (2) of the said notification. Further reliance was placed on the following decisions supporting the contentions of the assessee. a. Pr CIT v/s Khetilal Sharma (HUF) 2017 (11) TMI 1651 -Raj HC b. ITO v/s Akash Deep Farms P. Ltd 2016 (9) TMI 918-ITAT AHD c. Shri DashratbhaiGopalbhai Pate! I.T.A. No. 1356/Ahd/2017 9. The written submissions in this regard were filed before us, which are reproduced hereinunder: Municipality vs Municipal Corporation Ahmedabad Urban Development Authority (ADDA) was established on February 1. 1978 by the Government of Gujarat. The prime objective of the AUDA's formation was to carry out the sustained planned development of the area failing outside the periphery of Ahmedabad Municipal Corporation. A Municipality or Municipal Corporation is Constitutional body, while a Development Authority is a creation of statute. The role of Municipality or Municipal Corporation is altogether different from Development Authority. AUDA does not have elected representatives but only nominated representatives by the Government Moreover, it does not have power to levy taxes. It is held by Hon'ble Kerala High Court in the case of CIT v/s Murali Lodge 194 ITR 125 (Ker) that only those local authorities, township, etc. can be treated as municipality within meaning of section 2(14)(iii)(a) which satisfy the requirements of a municipality within the meaning of relevant Municipal Act. It is held in following judgements that a Development Authority is not a Municipality: ITA No.1384 and 1472/Ahd/2019 7 a. Smt.T. Urmila v/s ITO (2012} 34 CCH 0477 HydTrib & b. ITO v/s Shri Adela Krishna Reddy [ITA No.l838/Hyd/2013) Measurement of Distance Further the distance of Land is as under; Land at Distance as per Google Map Page Reference Ahmedabad Sannand Telav 18.3 KMs 6.2 KMs Page 7 & 8 of GT Appeal Order - Sanathal 13.5 KMs 11.6 KMs Distance based on Certificate of Deputy Engineer Road and Building Department Dated 08.05.2019. Distance from Ahmedabad to Telav 16 KMs Page 7 & 8 of C1T Appeal Order Distance from Ahmedabad to Sanathal 12 KMs The provision regarding measurement of distance 'aerially' has been introduced for the first time by the Finance Act, 2013 w.e.f, 01.04.2015 only. Thus, in this case the distance between the impugned land 'municipality' or 'municipal corporation' must be measured via the shortest road distance. Reliance is placed in the case of a. CIT(A) v/s Nitish Rameshchandra Chordia (2015) 374ITR 531 (Bom) b. TO v/s Akash Deep Farms P. Ltd. 2016 (9) TMI 918-ITAT AHMEDABAD c. ShriDashratbhaiGopalbhaiPatel I.T.A. No. 1356/Ahd/2017 For the purpose of sub-clause (b) of Section 2(14)(iii), the distance from the 'municipality' or 'municipal corporation' has to be seen as on the date of Notification No. [SO 9447] [FileNo.l64/3/87-ITA.I] dated 06.01.1994 i.e. 06.01.1994 as per Explanation (2) to the above Notification. Moreover, the following decisions also support the above view:- a. Pr.CIT v/s KhetilalSharma(HUF) 2017 (11) TMI 1651 -Raj HC b. 1TO v/s Akash Deep Farms P. Ltd 2016 (9) TMI 918-iTAT AHD c. Shri DashratbhaiGopalbhai Patel I.T.A. No. 1356/Ahd/2017 _ The Explanation 2 is reproduced hereunder: ITA No.1384 and 1472/Ahd/2019 8 "(2) The reference to municipal limits or the limit of Cantonment Board in the schedule to this notification is to the limits as existing on the date on which the limits as existing on the date on which the notification is published in the Official Gazette." The Distance from Sanand as per Notification The Distance from Ahmedabad as per Notification Areas up to a distance of 2 kms. from the municipal limits in all directions Areas up to a distance of 8 kms. from the municipal limits in all directions 10. We have heard the ld.counsel for the assessee, and perused the ordersof the Revenue authorities. We also perused the submissions filed in writing before us and the case laws referred to before us. The short issue for adjudication is, whether the lands sold by the assessee qualified as “capital asset” in terms of section 2(14)(iii) of the Act. For clarity, the section is reproduced hereunder: 2(14)(iii) agricultural land in India, not being land situate— (a) in any area which is comprised within the jurisdiction of a municipality (whether known as a municipality, municipal corporation, notified area committee, town area committee, town committee, or by any other name) or a cantonment board and which has a population of not less than ten thousand ; or (b) in any area within the distance, measured aerially,— (I) not being more than two kilometres, from the local limits of any municipality or cantonment board referred to in item (a) and which has a population of more than ten thousand but not exceeding one lakh; or (II) not being more than six kilometres, from the local limits of any municipality or cantonment board referred to in item (a) and which has a population of more than one lakh but not exceeding ten lakh; or (III) not being more than eight kilometres, from the local limits of any municipality or cantonment board referred to in item (a) and which has a population of more than ten lakh. Explanation.—For the purposes of this sub-clause, "population" means the population according to the last preceding census of which the relevant figures have been published before the first day of the previous year; 11. As is evident, agricultural and situated within the jurisdiction of municipality or cantonment board or within the specified limits of ITA No.1384 and 1472/Ahd/2019 9 such municipality or cantonment board, qualify as capital asset. The limits from the respective municipalities or cantonment boards, have been specified by the CBDT in its Notification No.SO-9447 F.No.164/3-ITA-I dated 6.1.1994. The Revenue has held the land qualifying as “capital asset” on the basis that the land was included in the AUDA, and are therefore within 8 kms. from the outer point of AMC. 12. We have noted that identical issue has been deal with the by the ITAT, Ahmedabad Bench in the case of Shri Dashratbhai Gopalbhai Patel, ITA No.1356/Ahd/2017 dated 31.8.2021 wherein they have held that the Development Authority cannot be equated with the Municipal Corporation, and therefore, the measurement of the Revenue Department fails. The relevant findings of the ITAT are at para 12 of its order, as under: “12. Moving further on merits, we find that the assessee has successfully demonstrated that the land parcels situated as Adalaj does not fall within the meaning of expression 'Municipality' or 'Municipal Corporation' and therefore falls in exception provided in sub-clause (a) to Section 2(14)(iii) of the Act. As stated on behalf of assessee, the development authority i.e. GUDA is a creation of statute. It cannot be equated with Municipal Corporation in the light of the ratio of decisions of Hon'ble Kerala High Court in the case of Murali Ldge (supra) and Smt. T. Urmila (supra) as rightly pointed out on behalf of the assessee. The provisions regarding aerial measurement of distance is applicable prospectively after the amendment by way of Finance Act, 2013. We also take affirmative note of the significant plea on behalf of the assessee that distance of 8 kms. from the Municipality has to be seen from the date of notification dated 06.11.1994 in the light of judicial pronouncements quoted above.” 13. Since no contrary decision has been pointed out by the Revenue before us, therefore, ratio laid down by the ITAT in the said decision will apply in the present case also, following which, we hold that the distance measurement bythe Revenue is not in accordance with law. ITA No.1384 and 1472/Ahd/2019 10 14. As for the distance measurement submitted by the assessee, the same is based on Google Map and that submitted by the Dy. Engineering, Road & Building Department, we fail to understand how this measurement can be treated as authentic. In our view, authority keeping records of land is the correct authority to issue certificate, and therefore, measurement certificate submitted by the assessee is also rejected. 15. Now since, there is no basis before us for determining the distance for the land sold by the assessee, the issue, we find, need reconsideration, and therefore the same is restored back to the AO to obtain necessary distance certificate from the appropriate authority, and thereafter adjudicate the issue in accordance with law. The assesses claim of exemption u/s 54B of the Act, is also restored back to be dealt with thereafter. The ground no.1 to 3 raised by the assessee, therefore, are allowed for statistical purpose. As also, the ground no.1 raised by the Revenue is also allowed for statistical purpose. 16. In the result, the appeal of the assessee is allowed for statistical purpose. 17. Now we shall deal with the remaining grounds of appeal of the Revenue. 18. The ground no.2 raised by the Revenue is as under: “(2) The Id. CIT(A) has erred in deleting the additions made u/s 68 of Rs.64,85,000/- + Rs.2,63,00,000/- + Rs.3,34,50,000/- aggregating Rs.6,62,35,000/- without appreciating the discrepancies and findings given by the AO in the remand report in the right perspective.” ITA No.1384 and 1472/Ahd/2019 11 19. The issue relates to the addition made under section 68 of the Act amounting to Rs.6,62,35,000/- which was deleted by the ld.CIT(A). 20. The facts relating to the case being that as per the AIR information, the assessee found to have credited amounts exceeding Rs.2.00 lakhs in cash in his bank account. The assessee was asked during the assessment proceedings to demonstrate the genuinenessof the same, which he failed to do so, and therefore, entire cash deposited amounting to Rs.6,90,17,521/- was added to his income pertaining to the following depositors: 21. During the appellate proceedings, the assessee submitted that necessary evidences were not filed to the AO because its premises was sealed by the Municipal Corporation, therefore, he furnished ITA No.1384 and 1472/Ahd/2019 12 additional evidence before the ld.CIT(A), which were admitted by him. A remand report was sought fromthe AO, after considering which, theld.CIT(A) deleted all the additionsmade except an amount of Rs.1,50,000/- received from one Shri S.M.Sipahi. The relevant finding of the ld.CIT(A) deleting the addition are at page no.53 to 57 of his order as under: “4.2.8. The appellant in respect of following persons has stated that he has submitted the confirmation and the amount has been received through cheque, therefore, addition is not justified. The appellant has further submitted the explanation of the credit in the bank account as out of recovery of advance loan given, and therefore, cannot be added u/s. 68 of the I. T. Act, 1961. Sr No. on page 1 3 and 1 4 of the assessment order and also SR no as per Remand Report NAME AMOUNT (Rs.) 05 A.A. Pathan 6,00,000 10 Zamirkhan Z. Pathan 4,85,000 11 Kamrunisa Ansari 25,00,000 18 Bharat Bharwad 19,00,000 19 Rakesh B. Shah 10,00,000 Total 64,85,000 The Assessing Officer in the remand report has observed that Shri A.A. Pathan has debit balance of Rs.27,20,185/- as on 01/04/2011 but as per books of Shri A. A. Pathan, the debit balance is Rs.24,35,959/-, therefore, appellant's explanation should not be accepted. As regard to Shri Zamirkhan Z. Pathan, the AO has noted that return of income and confirmation was filed but bank statement was not submitted. As regard to Smt. Kamrunisa Ansari, the AO has noted that identity, genuineness and creditworthiness not proved. As regard to Shri BharatbhaiBharwad, AO has observed that copy of bank statement, return of income has not been filed. As regard to Shri Rakesh B. Shah, the AO has observed that bank account has not been furnished. Appellant has submitted that he has furnished copy of confirmation which clearly shows that there was a opening balance against which the amount has been received during the year, and therefore, addition cannot be made. I agree with thesubmission made by the appellant that credit in the bank account in respect of above persons are recovery of ITA No.1384 and 1472/Ahd/2019 13 advance made in earlier year and receipt is by cheque, and therefore, same cannot be added u/s. 68 of the Act as held by Honourable Gujarat High Court in the case of CIT, Surat- 1 Vs. Shree Mahavir Crimpers [2018] 95 Taxman.com 323 (Guj'arat) and decision in the case of CIT Vs. Aayachi Chandrashekhar Narsangi. Therefore, the addition made by the AO to the extent of Rs.64,85,000/- in respect of credit from above persons is deleted. 4.2.9. The appellant in respect of following persons has stated that he has submitted the confirmation and the amount has been received through cheque, therefore, addition is not justified. The appellant has further submitted that the credit entry in the bank is loan which has been subsequently repaid, and therefore, addition u/s. 68 cannot be made in view of decision of jurisdictional High Court. Sr No. on page 1 3 and 1 4 of the assessment order and also SR no as per Remand Report NAME AMOUNT 02 AbdulhaaShamshulhaa 50,00,000 03 TajbhanuVazirkhan 1 ,20,00,000 08 ImanulhaqShamshulhaq 50,00,000 15 Y.Y. Sheikh ( Biren J. Patel) -C.M. Motors 18,00,000 16 Kamlesh Bhaaat 25,00,000 Total 2,63,00,000 The Assessing Officer in the remand report in respect of Shri Abdulhaq Shamshulhaq has stated that the appellant has not proved the creditworthiness, though appellant has submitted copy of account of the said party, confirmation and relevant part of bank statement. As regard to Smt. TajbhanuVazirkhan, appellant has submitted confirmation, copy of ITR and copy of account. The Assessing Officer has doubted the creditworthiness. As regard to Shri ImanulhaqShamshulhaq appellant has submitted confirmation, copy of bank pass book. The AO has noted thatcreditworthiness has not been proved. In respect of Shri Y.Y. Sheikh, appellant submitted that amount is received from C. M. Motors, Prop. Shri Biren J. Patel and not from Shri Y. Y. Sheikh and submitted accounts from his books of accounts. The Assessing Officer has noted that the appellant has not discharged the onus, therefore, credit entry is not explained. As regard to Shri Kamlesh Bhagat, appellant submitted copy of account, copy of return of income and bank statement, however, the AO has noted that credit worthiness has not been proved as the total income shown is only Rs.3,24,330/-. Appellant has submitted confirmation from the above persons and the amount taken has been returned back subsequently. ITA No.1384 and 1472/Ahd/2019 14 Therefore, in view of decision of Honourable Gujarat High Court in the case of CIT Vs. Aayachi Chandrashekhar Narsangi, the addition made u/s. 68 is not sustainable in respect of above persons. 4.2.10. The appellant in respect of credit in the bank account received from following persons has stated that he has submitted the confirmation and other details and the amount has been received through cheque, therefore, addition is not justified. SrNo. on page 13 NAME AMOUNT and 14 of the assessment order and also SR no as per Remand Report 01 A K Buildcon 3,11,00,000 04 Shamana Shajid Momin 11,00,000 06 S.M. PathanfS.M. Sipai) 7,50,000 07 A.M. Sipai f S.M. Sipai) 1,50,000 13 H.N. Ghoghari 5,00,000 Total 3,36,00,000 As regardto credit entry of Rs.3,11,00,000/- from M/s. A. K.Buildcon, the appellant has submitted that M/s. A. K. Buildcon was a partnership concern of appellant and M/s. Lapis Impex Pvt. Ltd. The appellant has withdrawn fund from firm and deposited in his bank account. Appellant further explained the immediate source of fund as amount received by M/s. A. K. Buildcon from M/s. Lapis Impex Pvt. Ltd. The Assessing Officer has noted that the credit worthiness of the party from whom loan has been taken has not been proved. It is seen that appellant has submitted copy of partnership deed, copy of confirmation, copy of bank statement of M/s. A. K. Buildcon along with copy of confirmation from Lapiz Impex Pvt. Ltd., its bank statement and annual accounts of M/s. Lapis Impex Pvt. Ltd. Appellant has also submitted that M/s. Lapis Impex Pvt. Ltd. had reserves and surplus of Rs.7,41,86,000/- as on 31/03/2010 and on 31/03/2011. M/s. Lapis Impex Pvt. Ltd. has contributed through its bank account in the partnership concern M/s. A. K. Buildcon. The appellant has withdrawn capital from the firm and credited in its bank account. In view of the above, the credit entry in the bank account of appellant in respect of M/s. A. K. Buildcon is explained. ITA No.1384 and 1472/Ahd/2019 15 As regard to credit entry of Rs.11,00,000/- in respect of Smt. Shamana Shajid Momin, the Assessing Officer has observed that the appellant has not discharged onus of proving genuineness and creditworthiness. However, appellant has submitted that she is presently staying in USA and he has already submitted confirmation along with bank statement in support of the credit entry. It is seen from the bank statement of Smt. Shamana Shajid Momin held with AXIS Bank Account No.911010028697538 that there is a deposit out of closure proceeds in her bank account and out of above credit, cheque has been issued to the appellant. As appellant has furnished confirmation and entries through bank accounts and there is nothing abnormal noticed in view of decision of Honourable Gujarat High Court in the case of Rohini Builders (supra), the addition made by the AO cannot be sustained. As regard to credit entry of Rs.7,50,000/- from Shri S. M. Pathan (S. M. Sipahi), the appellant has submitted that the confirmation from Shri S.M.Sipahi, bank statement and copy of return of income showing annual income of Rs.7,50,000/- for A. Y. 2012-13. As appellant has submitted confirmation, bank statement and income tax return in respect of Shri S.M. Sipahi, the credit entry is duly explained. As regard to credit entry of Rs.5,00,000/- from Shri H.N. Ghoghari, appellant has submitted confirmation, bank statement and copy of income tax return explaining the source of the credit entry. Therefore, in view of decision of Honourable Gujarat High Court in the case of Rohini Builders (supa), the addition u/s. 68 of the I. T. Act, 1961 is not sustainable. As regard to credit entry of Rs.1,50,000/- from Shri A. N. Sipahi, appellant contended that same are issued by Shri S. M. Sipahi only and duly reflected in the bank account of Shri S.M. Sipahi, and therefore, credit entry is explained. I do not agree with the submission of the appellant, as Shri S. M. Sipahi has given confirmation only for Rs.7,50,000/-. Therefore, addition made to the extent of Rs.1,50,000/- is confirmed.” 22. As is evident from the above, the ld.CIT(A) deleted the addition of Rs.1,34,17,521/- noting that the AO had accepted the explanation of source of deposits in the bank account to the said extent. In view of the same, we hold that since the AO has accepted explanation of source with respect to the deposits of Rs.1.34 crores, there can be no grievance of the AO. Therefore, order of the ld.CIT(A) deleting the addition of unexplained cash deposits to Rs.1,34,17,521/- is upheld. ITA No.1384 and 1472/Ahd/2019 16 23. With respect to the balance cash deposited, we have noted that the ld.CIT(A) has accepted the explanation of the assessee giving detailed finding with respect toeach deposits. Para 4.2.8 of his order deals with cash deposits from five parties noted therein amounting to Rs.64.85 lakhs. The ld.CIT(A) has given a finding of fact that the amount received by the assessee from them was from the opening balance outstanding in their name which were confirmed by the said parties. 24. With respect to the parties mentioned at para 4.2.9 of his order, from whom amounts of Rs.2.63 crores were received by the assessee, the ld.CIT(A) noted with respect to such parties, the assessee has submitted relevant bank accounts proving credit- worthiness of the said parties, as also their confirmation and copy of the return of income. The ld.CIT(A) also noted that the said amounts were shown to have been returned also, therefore, relying upon the decision of the Hon’ble Gujarat High Court in thecase of CIT Vs. Aayachi Chandrakshekar Narsangi, the ld.CIT(A) deleted the addition made. 25. With respect to the amount of Rs.3.36 crores, received from parties listed in 4.2.10 of his order again, we find, the ld.CIT(A) has given detailed finding of being satisfied with the genuineness of the credit, noting that the said parties had filed their confirmation, returned income and bank statement. 26. In view of the above detailed factual finding of theld.CIT(A), which have not been controverted by the Revenue, we see no reasons to interfere in the order of the ld.CIT(A) on this issue of deleting the addition on account of cash deposits in the bank to the tune of Rs.6,62,35,000/-. ITA No.1384 and 1472/Ahd/2019 17 The ground no.2 raised by the Revenue is dismissed. 27. In the result, the appeal of the assessee is allowed for statistical purpose, and the appeal of the Revenue is partly allowed for statistical purpose. Order pronounced in the Court on 7 th November, 2023 at Ahmedabad. Sd/- Sd/- (MADHUMITA ROY) JUDICIAL MEMBER (ANNAPURNA GUPTA) ACCOUNTANT MEMBER Ahmedabad, dated 07/11/2023