Shri Vijay Prasad, V. DCIT,

ITA 157/RAN/2014

• Counselvise Citation: [2014] 120 COUNSELVISE.COM (IT) 8587 (ITAT-RANCHI)
• Duration Of Justice: 7 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-12-2014
• Appeal Filed By: Assessee
• Bench Allotted: DB
• Assessment Year: 2009-2010
• Appeal Filed On: 25-04-2014
• Court: TRIBUNAL
• Department Lawyers: DEEPAK ROSHAN SENIOR S CLD
• Assessee Lawyers: S K PODDAR; M K CHOUDHARY S LD ARS
• Keywords: Unexplained investment; Sale consideration of property below Jantri Value; Search and seizure

Judgement Text

1 ITA NOS. 157,158/RAN/14 S/SH.VIJAY PRASAD & SACHI NA ND PRASAD INCOME TAX APPELLATE TRIBUNAL, CIRCUIT BENCH, RANCHI BEFORE HON'BLE SHRI H.L. KARWA, PRESIDENT , AND HON'BLE SHRI B.R. BASKARAN, ACCOUNTANT MEMBER ITA NO. 157/ RAN/201 4 A.Y . 2009 - 10 SHRI VIJAY PRASAD VS. D.C.I.T, CC - 1, RANCHI PAN: AILPP0228L ( APPELLANT ) ( RESPONDENT ) ITA NO. 158/ RAN/201 4 A.Y 2009 - 10 SHRI SACHIDA NAND PRASAD VS. D.C.I.T, CC - 1, RANCHI PAN:ABWPP8560D ( APPELLANT ) ( RESPONDENT ) FOR THE APPELLANT : S/ SHR I S.K PODDAR & M. K CHOUDHARY, ADVOCATES, LD.ARS FOR THE RESPONDENT : SHRI DEEPAK ROSHAN, SENIOR S.C.LD.DR DATE OF HEARING : 04 - 12 - 2014 DATE OF PRONOUNCEMENT: 04 - 12 - 2014 O R D E R SHRI B.R. BASKARAN, A CCOUNTANT MEMBER : THE APPEALS FILED BY THE RESPECTIVE ASSESSEES ARE DIRECTED AGAINST THE ORDER PASSED BY LD CIT(A) IN THEIR HANDS AND BOTH THE APPEALS RELATE TO THE ASSESSMENT YEAR 2009 - 10. 2. IN THE APPEAL FILED BY SHRI SACHIDA NAND PRASAD, THE ASSESS EE IS AGGRIEVED BY THE DECISION OF LD CIT(A) IN CONFIRMING THE ADDITION OF RS.6,12,496/ - PERTAINING TO THE DIFFERENCE BETWEEN THE PURCHASE 2 ITA NOS. 157,158/RAN/14 S/SH.VIJAY PRASAD & SACHI NA ND PRASAD CONSIDERATION SHOWN IN THE CONVEYANCE DEED AND THE VALUE DETERMINED FOR STAMP DUTY PURPOSES IN RESPECT OF A PROPERTY PURCHASED. 3. IN THE APPEAL FILED BY SHRI VIJAY PRASAD, THE ASSESSEE IS AGGRIEVED BY THE DECISION OF LD CIT(A) IN CONFIRMING THE ADDITION OF RS.24,06,123/ - PERTAINING TO THE DIFFERENCE BETWEEN THE PURCHASE CONSIDERATION SHOWN IN THE CONVEYANCE DEED AND TH E VALUE DETERMINED FOR STAMP DUTY PURPOSES IN RESPECT OF A PROPERTY PURCHASED. 4. WE NOTICE THAT THERE WAS A SEARCH AND SEIZURE OPERATION AT THE RESIDENTIAL PREMISES OF BOTH THE ASSESSEES ON 16.02.2010. AT THE TIME OF SEARCH, A SWORN STATEMENT U/ S 132(4) OF THE ACT WAS TAKEN FROM SHRI SACHIDA NAND PRASAD, WHEREIN HE DISCLOSED THE DETAILS RELATING TO THE INVESTMENTS MADE IN THE NAME OF ALL THE FAMILY MEMBERS. BOTH THE ASSESSEES HAD JOINTLY PURCHASED AN OFFICE SPACE AT 2 ND AND 3 RD FLOOR OF PARIJHAT , JAMSHEDPUR. IN THE SWORN STATEMENT SHRI SACHIDANAND PRASAD ADMITTED THAT THE CONSIDERATION PAID FOR THE ABOVE PROPERTY WAS RS.1,20,03,160/ - . THE AO EXAMINED THIS TRANSACTION OF PURCHASE IN THE HANDS OF SHRI VIJAY PRASAD, WHO SUBMITTED THAT THE PROPERTY WAS PURCHASED FOR RS.95,97,037/ - ONLY. HOWEVER, THE AO NOTICED THAT THE STAMP AUTHORITY HAD VALUED THE PROPERTY FOR RS.1,20,03,160/ - AND SHRI SACHIDA NAND PRASAD HAD ALSO ADMITTED THE SAID AMOUNT IN THE SWORN STATEMENT. HENCE THE AO ASSESSED THE DIFFERE NCE AMOUNT OF RS.24,06,123/ - FULLY IN THE HANDS OF SHRI VIJAY PRASAD. IT IS PERTINENT TO NOTE THAT SHRI VIJAY PRASAD HELD ONLY 50% OF THE SHARE IN THE ABOVE SAID PROPERTY. 3 ITA NOS. 157,158/RAN/14 S/SH.VIJAY PRASAD & SACHI NA ND PRASAD 5. SHRI SACHIDA NAND PRASAD HAD INDEPENDENTLY PURCHASED AN OFFICE SPACE AT 4 TH F LOOR OF PARIJHAT, JAMSHEDPUR. THE PROPERTY WAS VALUED FOR STAMP DUTY PURPOSES AT RS.58,63,800/ - ,WHERE AS THE SALE CONSIDERATION WAS SHOWN IN THE CONVEYANCE DEED AT RS.45,62,597/ - AND AFTER ADDING THE STAMP DUTY AND REGISTRATION CHARGES, THE TOTAL AMOUNT S HOWN BY THE ASSESSEE WORKED OUT TO RS.50,57,100/ - . IN THE SWORN STATEMENT, HE HAD ADMITTED THE PURCHASE CONSIDERATION TO BE RS.58,63,800/ - . HENCE THE AO ASSESSED THE DIFFERENCE AMOUNT OF RS.6,12,496/ - AS THE INCOME OF THE ASSESSEE. 6. IN THE APPEALS FILED BY BOTH THE PARTIES, THE LD CIT(A) CONFIRMED THE ADDITIONS MADE BY THE AO. HENCE, BOTH THE PARTIES ARE IN APPEAL BEFORE US. 7. BEFORE US, THE LD A.R VEHEMENTLY CONTENDED THAT THE PURCHASE CONSIDERATION PAID BY THE ASSESSEE HAS BEEN DULY DECLARE D IN THE CONVEYANCE DEED AND THE STAMP DUTY WAS PAID ON THE VALUE DETERMINED BY THE STAMP AUTHORITY TO SUIT THE CONVENIENCE. THE SAID FACT HAS ALSO BEEN MENTIONED IN THE CONVEYANCE DEED. ACCORDINGLY THE LD A.R SUBMITTED THAT THE ASSESSING OFFICER WAS NOT JUSTIFIED IN DRAWING INFERENCE THAT THE DIFFERENCE BETWEEN THE ACTUAL CONSIDERATION AND STAMP DUTY VALUE REPRESENT UNACCOUNTED PAYMENT, WITHOUT BRINGING ANY MATERIAL ON RECORD. HE SUBMITTED THAT THE STATEMENT GIVEN BY SHRI SACHIDA NAND PRASAD HAS NOT BEE N CORROBORATED WITH ANY OTHER EVIDENCE. ACCORDINGLY, HE SUBMITTED THAT THE TAX AUTHORITIES ARE NOT JUSTIFIED IN ASSESSING THE DIFFERENCE AS UNEXPLAINED INVESTMENT, WHEN THE ASSESSEES HAVE NOT PAID THE DIFFERENCE AMOUNT AT ALL. 4 ITA NOS. 157,158/RAN/14 S/SH.VIJAY PRASAD & SACHI NA ND PRASAD 8. THE LD A.R MADE IDENT ICAL SUBMISSIONS IN RESPECT OF THE ADDITION MADE IN THE HANDS OF SHRI SACHIDA NAND PRASAD. 9. ON THE CONTRARY, THE LD D.R SUBMITTED THAT THE DIFFERENCE BETWEEN THE STAMP DUTY VALUE AND STATED CONSIDERATION WAS ACCEPTED AS UNDISCLOSED INCOME BY SHRI SA CHIDANAND PRASAD IN THE SWORN STATEMENT TAKEN U/S 132(4) OF THE ACT. HE FURTHER SUBMITTED THAT THE ASSESSEE S HAVE AVAILED BANK LOANS FOR PURCHASE OF BOTH THE PROPERTIES AND AMOUNT OF LOAN WA S EQUAL TO THE AMOUNT OF CONSIDERATION STATED IN THE CONVEYANCE D EED. THE LD D.R SUBMITTED THAT IT IS IN THE COMMON KNOWLEDGE OF EVERY BODY THAT THE BANK DOES NOT GIVE LOAN UPTO 100% OF THE COST OF THE FLAT. ACCORDINGLY HE SUBMITTED THAT THE VALUE DETERMINED BY THE STAMP AUTHORITY WAS THE CORRECT VALUE AND ACCORDINGLY THE ASSESSING OFFICER WAS JUSTIFIED IN ASSESSING THE DIFFERENCE AMOUNT. 10. WE NOTICE THAT THE ASSESSING OFFICER HAS ASSESSED THE ENTIRE DIFFERENCE OF RS.24,06,103/ - IN THE HANDS OF SHRI VIJAY PRASAD, WHERE AS THE FACT REMAINS THAT HE OWNED ONLY 50 % SHARE IN THE SAID PROPERTY. HENCE, WE ARE NOT ABLE TO UNDERSTAND AS TO HOW THE AO COULD ASSESS THE ENTIRE DIFFERENCE IN THE HANDS OF SHRI VIJAY PRASAD. FURTHER, WE NOTICE THAT THE AO HAD PLACED RELIANCE ON THE SWORN STATEMENT GIVEN BY SHRI SACHIDA NAND PRASAD, WITHOUT CONFRONTING THE SAME WITH SHRI VIJAY PRASAD. HOWEVER, AT THE SAME TIME, T HERE IS ALSO MERIT IN THE SUBMISSION MADE BY LD D.R WITH REGARD TO THE BANK LOANS AVAILED BY THE ASSESSEES FOR PURCHASE OF BOTH THE ASSETS. ON THE CONTRARY, BOTH T HE ASSESSEES ARE STRONGLY CONTENDING THAT THE CONSIDERATION MENTIONED IN THE CONVEYANCE 5 ITA NOS. 157,158/RAN/14 S/SH.VIJAY PRASAD & SACHI NA ND PRASAD DEED WAS THE ACTUAL AMOUNT PAID BY THEM. WITH REGARD TO THE STATEMENT GIVEN BY SHRI SACHIDA NAND PRASAD U/S 132(4) OF THE ACT, THE CONTENTION WAS THAT IT WAS GIVEN OU T OF MEMORY AND HENCE THE SAME SHOULD BE CORROBORATED WITH OTHER MATERIAL. 11. IN VIEW OF THE RIVAL CONTENTIONS AND ALSO IN VIEW OF THE INFIRMITY IN THE ACTION OF THE AO IN ASSESSING THE ENTIRE DIFFERENCE AMOUNT IN THE HANDS OF SHRI VIJAY PRASAD, WE A RE OF THE VIEW BOTH THE MATTERS NEED FURTHER EXAMINATION. ACCORDINGLY, WE SET ASIDE THE ORDER OF LD CIT(A) IN BOTH THE CASES AND RESTORE THEM TO THE FILE OF THE RESPECTIVE ASSESSING OFFICER WITH THE DIRECTION TO EXAMINE THEM AFRESH. THE ASSESSEES ARE ALS O DIRECTED TO FURNISH NECESSARY DOCUMENTS TO SUBSTANTIATE THEIR CLAIM. THE ASSESSING OFFICER, IF FOUND NECESSARY, MAY MAKE NECESSARY ENQUIRIES WITH THE SELLERS AND/OR CARRY OUT SUCH OTHER ENQUIRY IN THIS MATTER. WE ORDER ACCORDINGLY. 12. IN THE RESUL T, THE APPEALS FILED BY BOTH THE ASSESSEES ARE TREATED AS ALLOWED FOR STATISTICAL PURPOSES. PRONOUNCED ACCORDINGLY ON 04 - 12 - 2014 SD/ - SD/ - [ H.L. KARWA ] [ B.R. BASKARAN ] PRESIDENT ACCOUNTANT MEMBER DT. 04 - 12 - 2014 PLACE : RANCHI PP, SR. PS COPY OF THE ORDER FORWARDED TO: 6 ITA NOS. 157,158/RAN/14 S/SH.VIJAY PRASAD & SACHI NA ND PRASAD 1. THE APPELLANT : 2 THE RESPONDENT: 3..THE CIT, 4.THE CIT(A), 5.DR, I TAT CIRCUIT BENCH, RANCHI 6. GUARD FILE. TRUE COPY, BY ORDER, ASSTT. REGISTRAR 1. DATE OF DICTATION ............ ORDER DRAFTED BY HON'BLE.MEMBER 04 - 12 - 2014....................... 7 ITA NOS. 157,158/RAN/14 S/SH.VIJAY PRASAD & SACHI NA ND PRASAD 2. DATE ON WHICH THE TYP ED DRAFT IS PLACED BEFORE THE DICTATING MEMBER ........................OTHER MEMBER ..... 12 - 2014........................ 3. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR. P.S./P.S. ..................... 4. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE T HE DICTATING MEMBER FOR PRONOUNCEMENT................................ 04 - 12 - - 2014................................................... 5. DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR. P.S./P.S ................ 6. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK ....................................... 7. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK ......................................... 8. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT REGISTRAR FOR SIGNATURE ON THE ORDER .............................. ................................................................... 9. DATE OF DESPATCH OF THE ORDER ..............................................................