The DCIT, Circle 1, Ahmedabad V. Shri Sandeep Pravinbhai Engineer, Ahmedabad

ITA 1714/AHD/2015

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 8615 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 2 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-08-2017
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Assessment Year: 2010-2011
• Appeal Filed On: 12-06-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ROOP CHAND
• Assessee Lawyers: BIREN SHAH
• Keywords: Unexplained investment; Tax effect
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD C BENCH AHMEDABAD BEFORE, SHRI S. S. GODARA, JUDICIAL MEMBE R AND SHRI AMARJIT SINGH, ACCOUNTANT MEMBER ITA NO. 1714/AHD/2015 (ASSESSMENT YEAR: 2010-11) DCIT, CIRCLE 1(1)(1), AHMEDABAD APPELLANT VS. SHRI SANDEEP PRAVINBHAI ENGINEER 59, NEHRU PARK, VASTRAPUR, AHMEDABAD 380015 RESPONDENT PAN: AABPE1175D /BY REVENUE : SHRI ROOPCHAND, SR. D.R. /BY ASSESSEE : SHRI BIREN SHAH, A.R. /DATE OF HEARING : 29.08.2017 /DATE OF PRONOUNCEMENT : 30.08.2017 ORDER PER S. S. GODARA, JUDICIAL MEMBER THIS REVENUES APPEAL FOR ASSESSMENT YEAR 2010-11 I S DIRECTED AGAINST THE CIT(A)-1, AHMEDABADS ORDER DATED 03.03.2015, I N CASE NO. CIT(A)- I/DCIT,CIR-1/40/2013-14, REVERSING ASSESSING OFFICE RS ACTION MAKING UNACCOUNTED INVESTMENT IN LAND ADDITION OF RS.34,46 ,870/- IN ASSESSMENT ITA NO. 1714/AHD/15 (DCIT VS. SANDEEP P. ENGINEER) A.Y. 2010-11 - 2 - ORDER DATED 30.03.2013, IN PROCEEDINGS U/S. 143(3) OF THE INCOME TAX ACT, 1961; IN SHORT THE ACT. CASE CALLED TWICE. NONE APPEARS AT ASSESSEES BEH EST DESPITE THE FACT THAT THE REGISTRY HAS ALREADY ISSUED AN RPAD N OTICE DATED 29.08.2017. WE THEREFORE PROCEED EX PARTE AGAINST THE ASSESSEE. 2. RELEVANT FACTS PERTAINING TO THE ABOVE SOLE ISSU E OF UNACCOUNTED INVESTMENT ADDITION OF RS.34,46,870/- ARE IN A VERY NARROW COMPASS. THE ASSESSING OFFICER FRAMED THE IMPUGNED ADDITION IN A SSESSEES CASE ON THE BASIS OF A SURVEY OPERATION DATED 15.04.200 CARRIED OUT IN CASE OF M/S. ASTRAL POLYTECHNIC LTD. THE DEPARTMENT CAME ACROSS ALLEGE D INCRIMINATING MATERIAL INDICATING THE ASSESSEE TO HAVE INDULGED IN ON MONE Y PAYMENTS IN VARIOUS LAND TRANSACTIONS. THE ASSESSING OFFICER REFERRED TO ASSESSEES SURVEY STATEMENT TO OBSERVE IN ASSESSMENT ORDER THAT HE HA D INDEED PAID CASH COMPONENT OF RS.34,46,870/- IN QUESTION OVER AND AB OVE CHEQUE AMOUNT OF RS.4,97,000/-. ALL THIS RESULTED IN THE IMPUGNED ADDITION BEING MADE IN ASSESSEES HANDS. 3. THE CIT(A) DELETES THE IMPUGNED ADDITION AS UNDE R: B) GROUND NO. 2 TO 4 ARE INTERLINKED AND AGAINST T HE ADDITION OF RS. 3446870 AS UNACCOUNTED INVESTMENT. IT WAS CONTENDED THAT THE A.O. HAS NOT CONSIDERED THE FACT THAT THE APPELLANT WAS HAVING CASH ON HAND OF RS. 102514000 BEING 50% OUT OF ON MONEY RECEIVED FROM SALE OF LAND AT BLOCK NO. 69, LILAPUR, TALUKA DASCROI, DIST . AHMEDABAD DURING F.Y. 07-08 AND THE SAME CASH WAS UTILIZED IN PAYMEN T OF ON MONEY OF RS. 3446870 FOR PURCHASE OF LAND DURING PREVIOUS YE AR. IT WAS ALSO SUBMITTED THAT MY PREDECESSOR IN THE APPELLANT'S OW N CASE FOR A.Y. 08- 09 ON THE SAME ISSUE WITH SIMILAR FACTS DELETED THE ADDITION SO MADE BY THE A.O. I AM INCLINED WITH APPELLANT THAT AS PER THE IMPOU NDED MATERIAL AS ANNEXURE A-5 AND ADMISSION BY APPELLANT IN THE STATEMENT RECORDED ON OATH ON 15/04/2010, THE APPELLANT WITH HIS WIFE SMT. JAGRUTI ENGINEER WERE IN RECEIPT OF RS. 302027853 A S SALE ITA NO. 1714/AHD/15 (DCIT VS. SANDEEP P. ENGINEER) A.Y. 2010-11 - 3 - CONSIDERATION OF LAND AT LILAPUR SOLD ON 06/08/2005 WHICH INCLUDED RS. 7000000 BY CHEQUE AND RS. 205027853 IN CASH. IT IS ALSO EVIDENT FROM THE IMPOUNDED MATERIAL ANNEXURE A-2 THAT APPEL LANT PAID ON MONEY FOR THE PURCHASES OF VARIOUS LANDS (THE A.O. DISCUSSED IN A TABULAR FORM AT PARA-2 OF THE IMPUGNED ORDER) DURIN G F.Y. 06-07, 07- 08 AND 09-10. THE TOTAL ONMONEY SO PAID IS OF RS. 5 388370. DURING THE PREVIOUS YEAR ONMONEY OF RS. 3446870 WAS PAID F OR THE PURCHASE OF LAND AT SURVEY NO. 1207 ON 06/04/2009 REFLECTING REGISTERED PURCHASE VALUE AT RS. 497000 (ANNEXURE A-2 PAGE NO. 161 AND 162). THE A,Q HAS NOT GIVEN ANY COGENT REASON FOR NOT ACC EPTING SUCH CONTENTION OF APPELLANT. WHEN THE APPELLANT HAS ADM ITTED THE RECEIPT OF ON MONEY ON THE SALE OF LAND ON THE BASIS OF IMPOUN DED MATERIAL THEN HE SHOULD BE GIVEN CREDIT OF PAYMENT OF ON MONEY FO R PURCHASE OF LAND BASED ON SAME IMPOUNDED MATERIAL UNLESS AND OTHERWI SE THE RECEIPT OF ON MONEY WAS FOUND TO BE UTILIZED FOR OTHER PURPOSE S AND NOT FOR PURCHASES. MY PREDECESSOR LD. CIT(A) IN THE APPELLA NT'S CASE FOR A.Y. 08-09 VIDE ORDER DATED 20/06/2013 DELETED SUCH ADDI TION OF RS. 1409500 MADE BY THE A.O. IT IS THEREFORE FOLLOWING THE RATIO OF SUCH ORDER (DISCUSSED AT PARA 2.1 OF APPELLANT'S SUBMISS ION ABOVE AT PARA 4B) AND CONCEPT OF TELESCOPING THE A.O. IS DIRECTED TO ALLOW THE CREDIT OF RS. 3446870 BEING PAID AS ON MONEY FOR PURCHASE OF LAND OUT OF ON MONEY RECEIVED ON SALE OF LAND AND DELETE THE ADDIT ION SO MADE OF RS. 3446870. THE APPELLANT GETS RELIEF ACCORDINGLY. ALL THESE GROUNDS ARE ALLOWED. 4. HEARD LEARNED DEPARTMENTAL REPRESENTATIVE STRONG LY ARGUING IN FAVOUR OF THE IMPUGNED ADDITION. IT HAS COME ON RECORD TH AT THE CIT(A) HAS FOLLOWED HIS CONCLUSION IN ASSESSEES OWN CASE PERT AINING TO ASSESSMENT YEAR 2008-09 DELETING AN IDENTICAL ADDITION AFTER HOLDIN G THAT HE WAS ENTITLED FOR TELESCOPING BENEFIT REGARDING ON MONEY RECEIVED IN LAND TRANSACTIONS AS VENDOR. THE SAID ON MONEY READS A FIGURE OF RS.20, 50,27,853/-. THE REVENUE FAILS TO REBUT THIS CLINCHING FINDING OF FACT. NOR DOES IT CONTEND THAT THE IMPUGNED TELESCOPING BENEFIT ALREADY STANDS GRANTED TO THE ASSESSEE EQUAL TO THE AMOUNT IN QUESTION. WE ARE FURTHER INFORMED TH AT THIS TRIBUNAL HAS ALREADY REJECTED REVENUES APPEAL ITA NO.1592/AHD/2013 PERTAINING TO THE SAID PRECEDING ASSESSMENT YEAR FOR LOW TAX EFFECT. BE TH AT AS IT MAY, THE IMPUGNED TELESCOPING BENEFIT ORDERED TO BE GRANTED TO THE AS SESSEE IN LOWER APPELLATE ITA NO. 1714/AHD/15 (DCIT VS. SANDEEP P. ENGINEER) A.Y. 2010-11 - 4 - PROCEEDINGS IN VIEW OF CASH COMPONENT FOUND TO HAVE BEEN RECEIVED IN EARLIER ASSESSMENT YEAR(S) DOES NOT SUFFER FROM ANY INFIRMITY. WE THUS AFFIRM CIT(A)S FINDINGS UNDER CHALLENGE. 5. THIS REVENUES APPEAL IS DISMISSED. [PRONOUNCED IN THE OPEN COURT ON THIS THE 30 TH DAY OF AUGUST, 2017.] SD/- SD/- ( AMARJIT SINGH ) (S. S. GODA RA) ACCOUNTANT MEMBER JUDICIAL MEMBER AHMEDABAD: DATED 30/08/2017 S.K.SINHA / COPY OF ORDER FORWARDED TO:- / REVENUE 2 / ASSESSEE ! / CONCERNED CIT 4 !- / CIT (A) ( )*+ ,--. . /0 / DR, ITAT, AHMEDABAD 1 +23 45 / GUARD FILE. BY ORDER / . // . /0