Smt. Malti Gupta, Indore V. The I..T.O., Indore

ITA 18/IND/2010

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 9638 (ITAT-INDORE)
• Duration Of Justice: 1 year(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-02-2011
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: DB
• Next Hearing Date: 20-12-2010
• Assessment Year: 2006-2007
• Appeal Filed On: 11-01-2010
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: PRADEEP KUMAR MITRA
• Keywords: Income from undisclosed sources
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL INDORE BENCH : INDORE BEFORE SHRI JOGINDER SINGH, JUDICIAL MEMBER AND SHRI R.C.SHARMA, ACCOUNTANT MEMBER PAN NO. : ABIPG3811G I.T.A.NO.18/IND/2010 A.Y. : 2006-07 SMT. MALTI GUPTA, ITO, 582, M. G. ROAD, VS 3(1), INDORE. INDORE. (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI PRAKASH JAIN, C. A. RESPONDENT BY : SHRI PRADEEP KUMAR MITRA, SR.DR O R D E R PER R. C. SHARMA, A.M. THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER OF CIT(A)-I, INDORE, DATED 16.10.2009 FOR THE ASSES SMENT YEAR 2006-07 IN THE MATTER OF ORDER PASSED U/S 143(3) OF THE INCOME-TAX ACT, 1961. 2. FOLLOWING GROUNDS OF APPEAL HAVE BEEN TAKEN BY THE ASSESSEE :- -: 2: - 2 1) THE LD. CIT(A)-I HAS ERRED IN UPHOLDING THE DISALLOWANCE OF RS.1,60,000/- BEING PAYMENT ROUTED THROUGH THE ACCOUNT OF ASSESSEE FOR PURCHASE OF HOUSE IN JOINT NAME WITH HER HUSBAND, THIS PAYMENT WAS RECEIVED BY THE ASSESSEE FROM HER HUSBAND. 2) THE LD. CIT(A)-I HAS ERRED IN UPHOLDING THE DISALLOWANCE OF RS. 2,12,360/- BEING PAYMENT MADE FOR ACQUISITION OF AGRICULTURE LAND ON THE HYPOTHESIS THAT THE LAND IS PURCHASED FROM UNDISCLOSED SOURCES, HE FAILED TO UNDERSTAND THAT WHEN AN ASSET IS DISCLOSED IN THE STATEMENT OF AFFAIRS OF THE ASSESSEE, WHO HE TREAT THE SAME AS INCOME FROM UNDISCLOSED SOURCES. 3) THE LD. CIT(A)-I HAS ERRED IN UPHOLDING THE DISALLOWANCE OF RS. 27,000/- BEING PURCHASE OF GOLD ORNAMENTS FOR WANT OF SUPPORTING BILLS ETC. THE ORNAMENTS ARE APPEARING IN THE STATEMENT OF AFFAIRS OF THE ASSESSEE, PAYMENT FOR PURCHASE OF THE SAME WAS MADE BY THE ASSESSEE 3. RIVAL CONTENTIONS HAVE BEEN HEARD AND RECORDS PERUSED. 4. IN THE COURSE OF SCRUTINY ASSESSMENT, THE AO MADE A N ADDITION OF RS. 1,60,000/- BEING PAYMENT MADE BY TH E ASSESSEE FOR PURCHASE OF HOUSE IN THE JOINT NAME WI TH HER HUSBAND. IN REPLY TO AOS QUERY REGARDING SOURCE OF INVESTMENT, IT WAS EXPLAINED THAT THE PAYMENT WAS R ECEIVED BY -: 3: - 3 THE ASSESSEE FROM HER HUSBAND. HER HUSBAND WAS WORK ING IN A BANK AND WAS HAVING GROSS INCOME OF RS. 5,63,740/ - AND TAXABLE INCOME OF RS. 4,63,740/- AS PER THE INCOME TAX RETURN FILED WITH THE DEPARTMENT. THE LD. AUTHORIZED REPRE SENTATIVE DREW OUR ATTENTION TO THE BALANCE SHEET OF THE HUSB AND OF THE ASSESSEE, WHEREIN THE PAYMENT MADE TO RAJ HOMES FOR PURCHASE OF RESIDENTIAL HOUSE WAS DULY DISCLOSED. T HE AO HAS DOUBTED THE GENUINENESS OF THE PAYMENT HAVING BEEN MADE BY HER HUSBAND, WHICH WE FOUND THAT THE ASSESSEE HAS E XPLAINED THE SAME AS HAVING BEEN PAID THROUGH HER HUSBAND. B ALANCE SHEET OF SHRI G.P. GUPTA, HUSBAND OF THE ASSESSEE I S ALREADY PLACED ON RECORD DULY INDICATING PAYMENT OF RS.1.60 LAKHS TO RAJ HOMES PRIVATE LIMITED. THE STATEMENT OF ACCOUNT OF ASSESSEE WITH M/S. RAJ HOMES PRIVATE LIMITED WAS AL SO PLACED BEFORE THE AO INDICATING PURCHASE OF HOUSE IN THE J OINT NAME OF ASSESSEE AND HER HUSBAND. THE SOURCE OF THE FUND HAS ALREADY BEEN EXPLAINED AS HAVING BEEN RECEIVED FROM HER HUSBAND, WHICH WAS DULY INDICATED IN THE BALANCE SH EET PLACED ON RECORD. IT APPEARS THAT THE BALANCE SHEET OF HER HUSBAND SHRI G.P. GUPTA WAS NOT FILED WITH THE DEPA RTMENT, -: 4: - 4 SINCE HIS RETURN WAS FILED IN FORM NO.2-D, THE SAME COULD NOT BE VERIFIED BY THE DEPARTMENT TO JUSTIFY THE PAYMEN T HAVING BEEN MADE BY HER HUSBAND. IN THE INTEREST OF JUSTIC E AND FAIR PLAY, WE RESTORE THIS GROUND TO THE FILE OF THE AO WITH THE DIRECTION TO VERIFY THE BALANCE SHEET OF HER HUSBAN D SHRI J.P. GUPTA AND TO DECIDE THE ISSUE AFRESH. IT IS PERTINE NT TO MENTION HERE THAT IF THE ASSESSEE HAS EXPLAINED THE PAYMENT AS HAVING BEEN MADE BY HER HUSBAND THROUGH BANK ACC OUNT, THE DEPARTMENT NOW CANNOT ASK FOR THE SOURCE OF SOU RCE. IF THE AO FINDS THAT THIS AMOUNT IS DULY INDICATED IN THE BALANCE SHEET OF SHRI J.P. GUPTA AS HAVING BEEN MADE TO M/S . RAJ HOMES PRIVATE LIMITED FOR ACQUIRING RESIDENTIAL HOU SE, THE SAME IS DIRECTED TO BE DELETED. WE DIRECT ACCORDING LY. 5. NEXT GRIEVANCE OF THE ASSESSEE RELATES TO ADDITION OF RS. 2,12,360/- BEING PAYMENT MADE FOR ACQUISITION OF AG RICULTURAL LAND. 6. WE HAVE CONSIDERED THE RIVAL CONTENTIONS, CAREFULLY GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW AN D FOUND THAT DURING THE YEAR THE ASSESSEE HAD SHOWN PURCHAS E OF AGRICULTURAL LAND SITUATED AT KOLAR ROAD, BHOPAL, A T RS. -: 5: - 5 2,12,360/-. THE ASSESSEE WAS ASKED TO EXPLAIN THE S OURCE OF INVESTMENT. IT WAS REPLIED BY THE ASSESSEE VIDE LET TER DATED 26.11.2008 THAT THE ASSESSEE PURCHASED THE LAND SIT UATED AT BHAISKHEDI AND THE SAME WAS REGISTERED IN SAME YEAR , BUT PAYMENT WAS MADE BY THE ASSESSEE IN THE ASSESSMENT YEAR 2006-07, HENCE, THE SAME IS APPEARING IN THE BALANC E SHEET OF ASSESSMENT YEAR 2006-07. HOWEVER, THE AO DID NOT AC CEPT THE ASSESSEES EXPLANATION AND THE CASH FLOW STATEMENT SUBMITTED BY HIM INDICATING ACQUISITION OF LAND AND PAYMENT M ADE FOR THE SAME. ALLEGATION OF THE AO WAS THAT THE ASSESSE E DID NOT SUBMIT ANY DOCUMENT OF OWNERSHIP OF THE SAID PROPER TY NOR SUBMITTED DETAILS OF SOURCE OF INVESTMENT IN THE PR OPERTY. 7. WE HAVE GONE THROUGH CASH FLOW STATEMENT PLACED ON RECORD AND FOUND THAT THE ASSESSEE HAS DULY DISCLOS ED ACQUISITION OF AGRICULTURAL LAND BY MAKING CASH PAY MENT, WHICH IS DULY APPEARING IN THE CASH FLOW STATEMENT AS PLACED ON THE RECORD. NO FAULT WAS FOUND BY THE ASSESSING OFFICER IN THE CASH FLOW STATEMENT. AS THE ASSESSEE HAS EXPLAI NED THE PURCHASE OF LAND AND ALSO SOURCE OF PAYMENT AS PER THE CASH FLOW STATEMENT, MERELY BECAUSE DOCUMENTARY EVIDENCE AND ITS -: 6: - 6 TITLE COULD NOT BE PRODUCED, THE GENUINE PAYMENT MA DE FOR ACQUISITION OF LAND CANNOT BE DISALLOWED, WHEN IT I S SUFFICIENTLY CORROBORATED BY THE STATEMENT OF AFFAIRS OF THE ASS ESSEE PLACED BEFORE THE LOWER AUTHORITIES. WHEN THE ASSESSEE IS MAKING THE PAYMENT AND IS SHOWING THE SAME IN STATEMENT OF AFF AIRS, THERE IS NO REASON FOR TREATING THE PURCHASE AS OUT OF UNDISCLOSED SOURCES. THE AO IS, THEREFORE, DIRECTED TO DELETE THE SAME. 8. LAST GRIEVANCE OF THE ASSESSEE RELATES TO DISALLOWA NCE OF RS. 27,000/- BEING PURCHASE OF GOLD ORNAMENTS FO R WANT OF SUPPORTING BILLS. 9. FROM THE RECORD, WE FOUND THAT THE GOLD ORNAMENTS WERE DULY APPEARING IN THE STATEMENT OF ACCOUNT, WH ICH WAS PURCHASE DURING THE YEAR, MERELY BECAUSE THE ASSESS EE HAS NOT OBTAINED THE BILL FOR THE SAME, PAYMENT MADE FO R ACQUISITION OF IT CANNOT BE TREATED AS OUT OF UNDIS CLOSED SOURCES. WHEN THE EXPENDITURE WAS INCURRED OUT OF T HE CASH FLOW STATEMENT AS SUBMITTED BEFORE THE LOWER AUTHOR ITIES ONLY FOR WANT OF SALE BILL, THE SAME CANNOT BE ADDED IN THE ASSESSEES INCOME. GENUINENESS OF PAYMENT MADE THR OUGH -: 7: - 7 CASH FLOW STATEMENT HAS NOT BEEN DOUBTED AND THE SA ME IS DULY APPEARING IN THE STATEMENT OF AFFAIRS, THERE I S NO JUSTIFICATION FOR ANY ADDITION FOR RS. 27,000/-. TH E AO IS DIRECTED TO DELETE THE SAME. 10. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWE D IN PART. THIS ORDER HAS BEEN PRONOUNCED IN THE OPEN COURT ON 2 ND FEBRUARY, 2011. SD/- SD/- (JOGINDER SINGH) ( R.C.SHARMA) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED : 2 ND FEBRUARY, 2011. CPU* 2.2