DCIT Central Circle-30, New Delhi V. Dhruva Goel, New Delhi

ITA 1646/DEL/2020

• Counselvise Citation: [2023] 102 COUNSELVISE.COM (IT) 0324 (ITAT-DELHI)
• Duration Of Justice: 3 year(s) 1 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-10-2023
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: G
• Next Hearing Date: 11-10-2023
• Assessment Year: 2011-2012
• Appeal Filed On: 30-09-2020
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Business income; Capital Gains
• Section: 132; 271(1)(c); 44AD

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHE “H”, NEW DELHI Before Sh. Saktijit Dey, Vice President Dr. B. R. R. Kumar, Accountant Member ITA No. 1602/Del/2020 : Asstt. Year: 2013-14 ITA No. 1603/Del/2020 : Asstt. Year: 2015-16 Dhruva Goel, K-69, FF, Hauz Khas Enclave, New Delhi-110016 Vs ACIT, Central Circle-30, New Delhi-110055 (APPELLANT) (RESPONDENT) PAN No. AAZPG0330Q ITA No. 1646/Del/2020 : Asstt. Year: 2011-12 ITA No. 1647/Del/2020 : Asstt. Year: 2013-14 ACIT, Central Circle-30, New Delhi-110055 Vs Dhruva Goel, K-69, FF, Hauz Khas Enclave, New Delhi-110016 (APPELLANT) (RESPONDENT) PAN No. AAZPG0330Q ITA No. 1601/Del/2020 : Asstt. Year: 2012-13 Urmila Goyal, K-69, FF, Hauz Khas Enclave, New Delhi-110016 Vs ACIT, Central Circle-30, New Delhi-110055 (APPELLANT) (RESPONDENT) PAN No. AAOPG3349Q ITA No. 1649/Del/2020 : Asstt. Year: 2011-12 ITA No. 1650/Del/2020 : Asstt. Year: 2013-14 ACIT, Central Circle-30, New Delhi-110055 Vs Urmila Goyal, K-69, FF, Hauz Khas Enclave, New Delhi-110016 (APPELLANT) (RESPONDENT) PAN No. AAOPG3349Q Assessee by : Sh. Prateek Mittal, CA Revenue by : Ms. Sapna Bhatia, CIT-DR Date of Hearing: 12.10.2023 Date of Pronouncement: 31.10.2023 ITA Nos. 1601, 1602 & 1603/Del/2020 ITA Nos. 1646, 1647, 1649 & 1650/Del/2020 Dhruva Goel & Urmila Goyal 2 ORDER Per Dr. B. R. R. Kumar, Accountant Member: The present appeals have been filed by the assessee and the Revenue against the orders of ld. CIT(A)-30, New Delhi dated 13.07.2020. 2. A search & seizure action u/s 132 has been conducted at the residential premises of the assessee in the month of July/August 2016. As per the seized material, Annexure A- 6/Page-6 which is a personal diary wherein the details mentioned thereon have been reproduced as under: 01.03.2011 C-690 - 7.50 164 SV - 9.00 E-29 - 3.30 H-17 - 3.75 J-17 - 5.06 N-81 - 14.50 I-8 - 7.50 Jewar - 1.60 3. The Revenue alleged that the amount represents the actual value of the properties mentioned thereon and brought to tax the difference between the amount mentioned and the registered value of the properties. ITA Nos. 1601, 1602 & 1603/Del/2020 ITA Nos. 1646, 1647, 1649 & 1650/Del/2020 Dhruva Goel & Urmila Goyal 3 ITA No. 1602/Del/2020 : A.Y. 2013-14 (Assessee Appeal) ITA No. 1647/Del/2020 : A.Y. 2013-14 (Revenue Appeal) 4. With regard to the H-17, Greater Kailash, Part-III property purchased by the assessee, based on the above document, the AO came to a conclusion that the total consideration was Rs.3.75 Cr. Since, the sale deed reflected the total consideration of Rs. 1 Cr., the AO concluded that the amount of Rs.2.75 Cr. has been paid in cash. Similarly, on account of E-29 property, the AO made addition of Rs.2.64 Cr. 5. With regard to H-17 property, the ld. CIT(A) referred the matter to the DVO and also obtained remand report from the AO and based on the report of the DVO considered the value of the property at Rs. 1 Cr. and gave relief of Rs.2.75 Cr. Since, the decision of the ld. CIT(A) is based on the report of the DVO and also remand report from the AO and since no perversity has been brought to our notice, we decline to interfere with the order of the ld. CIT(A) on this issue. 6. With regard to E-29 property, the ld. CIT(A) tailored the addition to Rs.10,30,400/- based on the DVO report which valued the value of property at Rs.76,30,400/-. It was brought to our notice with documentary evidence that the agreement to sell was dated 10.07.2011 for a consideration of Rs.66 lacs and an advance of Rs. 5 lacs has been paid. The sale deed was executed on 20.11.2012 after completion of the building. The value determined by the DVO was as on 20.11.2012 whereas the property was booked on 10.07.2011 and the construction was completed 16 months after booking of the property. The ITA Nos. 1601, 1602 & 1603/Del/2020 ITA Nos. 1646, 1647, 1649 & 1650/Del/2020 Dhruva Goel & Urmila Goyal 4 registration value of the property as on the date of booking i.e. 10.07.2011 was Rs.66 lacs. Hence, we hold that the DVO ought to have valued the property as on 10.07.2011 and since there is no difference in the value of the property as per the registration value, we hold that no addition is called for. ITA No. 1603/Del/2020 : A.Y. 2015-16 (Assessee Appeal) 7. The AO made addition of Rs.4,66,128/- on account of cash deposited in the bank account of the assessee and Rs.79,872/- on account of business receipts. 8. With regard to the addition of business receipts of Rs.79,872/-, it was submitted before us that the amount stands offered to tax under the head “income from business & profession” u/s 44AD of the Income Tax Act, 1961. Hence, we direct that the addition be deleted. 9. With regard to the cash deposited in the bank, the assessee submitted that the cash deposited in the bank account is from the available “cash in hand” and from past savings and agricultural income. The ld. AR has also submitted that the assessee has received rental income and an amount of Rs.8,34,000/- has been shown in the Income Tax Return and hence, no addition can be made. We find that the total cash deposits of Rs.13,80,800/- were found in the bank and the revenue has rightly allowed Rs.8,34,000/- being the rental income received in cash. We have already allowed Rs.79,872/- on account of business receipts declared u/s 44AD and keeping in view the general, social and financial condition an amount of Rs.1,00,000/- can be treated as “cash in hand” and hence, we ITA Nos. 1601, 1602 & 1603/Del/2020 ITA Nos. 1646, 1647, 1649 & 1650/Del/2020 Dhruva Goel & Urmila Goyal 5 decline to interfere with the order of the ld. CIT(A) in confirming the cash deposits to the tune of Rs.3,66,128/-. 10. In the result, the appeal of the assessee on this ground is partly allowed. ITA No. 1646/Del/2020 : A.Y. 2011-12 (Revenue Appeal) 11. The only issue pertains to addition made on account of cash payment with relation to acquisition of the property of C- 690. The ld. CIT(A) deleted the addition based on the valuation report obtained from the DVO and after getting a remand report from the AO. Since, the decision of the ld. CIT(A) is based on the report of the DVO, we decline to interfere with the order of the ld. CIT(A). Urmila Goyal ITA No. 1601/Del/2020 : A.Y. 2012-13 (Assessee Appeal) 12. The AO made addition of Rs.8,19,000/- on account of cash deposit in her bank account out of which the ld. CIT(A) gave relief of Rs.3,82,000/- and confirmed the addition of Rs.4,37,900/-. 13. Aggrieved, the assessee filed appeal before the ITAT against the confirmed addition of Rs.4,37,900/-. 14. It was submitted that the assessee has rental income of Rs.6,00,000/- and income from other sources of Rs.3,82,000/- which has been shown in the Income Tax Return and hence, no addition can be made. We find that the total cash deposits of Rs.14,19,900/- were found in the bank and the revenue has ITA Nos. 1601, 1602 & 1603/Del/2020 ITA Nos. 1646, 1647, 1649 & 1650/Del/2020 Dhruva Goel & Urmila Goyal 6 rightly allowed Rs.9,82,000/- being the rental income received in cash and income from other sources. Keeping in view the general, social & financial condition, the Pin money kept with the respected mothers and the married women, an amount of Rs.1,00,000/- can be considered as “cash in hand” and hence, we decline to interfere with the order of the ld. CIT(A) in confirming the cash deposits to the tune of Rs. Rs.3,37,900/-. 15. In the result, the appeal of the assessee is partly allowed. ITA No. 1649/Del/2020 : A.Y. 2011-12 (Revenue Appeal) 16. The only issue pertains to addition made on account of cash payment with relation to acquisition of the property of B- 15. The ld. CIT(A) deleted the addition based on the valuation report obtained from the DVO and after getting a remand report from the AO. Since, the decision of the ld. CIT(A) is based on the valuation report of the DVO and the remand report of the Assessing Officer, we decline to interfere with the order of the ld. CIT(A). ITA No. 1650/Del/2020 : A.Y. 2013-14 (Revenue Appeal) 17. The only issue pertains to addition made on account of Short term capital gains and interest earned with respect to the sale of the property B-15. This issue has been interlinked for the A.Y. 2011-12 wherein the ld. CIT(A) accepted the purchase price determined by the DVO at Rs.70,00,000/- and the addition made on account of the price difference stands deleted. With regard to the addition of Rs.6,56,250/-, the AO determined a presumptive value of Rs.4.13 Cr. and accordingly computed the ITA Nos. 1601, 1602 & 1603/Del/2020 ITA Nos. 1646, 1647, 1649 & 1650/Del/2020 Dhruva Goel & Urmila Goyal 7 capital gains. We find that the notional computation of capital gain which was subsequent to the determination of speculative sale price of Rs.4.13 Cr. which was based on the price notionally determined by the AO earlier at Rs.4.06 Cr. is without any logic. Hence, we decline to interfere with the order of the ld. CIT(A). Interest Income: 18. The entire part of the Assessment Order with relevance to this issue is as under: “10. The assessee has also received consideration on late payment of principal amount. The total consideration received by the assessee on account of interest payment @ 2% as per page no. 11 of Annexure A-6 which is already produced above. Total interest received works out to be Rs.2,97,92,000/- (7,10,92,000 - 4,13,00,000) and the same is added to the income of the assessee. Since, the assessee has filed inaccurate particulars of the Income. I am satisfied that the provisions of Section 271(1)(c) are attracted and penalty proceedings u/s 271(1)(c) will be initiated on this issue.” 19. The ld. CIT(A) deleted the addition holding that the AO has made addition of Rs. 2,97,92,000/- on account of interest income on sale of property B-15 Pamposh, New Delhi assuming that the assessee has received interest on late payment of principal amount. The total consideration received by the assessee on account of interest payment @ of 2% as per page no 11 of Annexure A-6 found at the time of search. Total interest received worked out by the AO was Rs. 2,97,92,000/- ITA Nos. 1601, 1602 & 1603/Del/2020 ITA Nos. 1646, 1647, 1649 & 1650/Del/2020 Dhruva Goel & Urmila Goyal 8 (7,10,92,000 4,13,00,000/-). The ld. CIT(A) accepted with the arguments of the assessee that the calculation of Rs. 710.92 Lakh on the right hand side of Annexure A6 refers to working made for the purpose to weigh the return on proposal of purchase of entire property B-15, Pamposh having cost Rs. 413 Lakh and had nothing to do with the sale of property by appellant in July 2012 for consideration of Rs. 1.20 Crore. The ld. CIT(A) concluded that it was mere proposal under discussion with the broker at that time for which detailed working was made and it was for self informative purpose of the appellant to assess the proposal at that time. This proposal never materialized and thus this computation was only a rough working for calculation purpose only. The ld. CIT(A) held that the AO has assumed the receipt of sale consideration of Rs. 413 Lakhs by the assessee between "June 2008 to Dec 2010 for the B-15, Pamposh, New Delhi. The ld. CIT(A) vide letter dated 02.07.2019, directed the AO to provide the working of the said amount. Vide the remand report dated 20.08.2019, the AO has reproduced part of para 10 of the assessment order of Smt. Urmila Goyal for the A.Y. 2013- 14 and has stated that the above working of interest was arrived as per page No. 11 of the Annexure A-6. In effect, the AO reiterated the Assessment Order. Hence, the ld. CIT(A) held that it is on estimation basis without any corroborative evidence and also no money trail or any other document containing the detail of interest received for this property as alleged. 20. The ld. CIT(A) concluded that there was no corroborative evidence with regard to the receipt of interest and computation of interest was only on estimate basis and hence accorded the ITA Nos. 1601, 1602 & 1603/Del/2020 ITA Nos. 1646, 1647, 1649 & 1650/Del/2020 Dhruva Goel & Urmila Goyal 9 relief. Having gone through the material on record, we find no reason to interfere with the order of the ld. CIT(A). 21. In the result, the appeal of the Revenue is dismissed. Order Pronounced in the Open Court on 31/10/2023. Sd/- Sd/- (Saktijit Dey) (Dr. B. R. R. Kumar) Vice President Accountant Member Dated: 31/10/2023 *Subodh Kumar, Sr. PS* Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT ASSISTANT REGISTRAR