Shri Bhawani Singh Shekhawat, 137, Sagar Road, Amer V. Income Tax Officer Ward-7(4), Jaipur, Ward-7(4), Jaipur

ITA 219/JPR/2019

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 8106 (ITAT-JAIPUR)
• Duration Of Justice: 1 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-04-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2010-2011
• Appeal Filed On: 19-02-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: A K MAHALA
• Keywords: Unexplained investment; Gift; Source of fund; Cost of acquisition

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHE S,B JAIPUR JH JESK LH0 KEKZ] YS[KK LNL; ,OA JH FOT; IKY JKO] U;KF;D LNL; DS LE{K BEFORE: SHRI RAMESH. C. SHARMA, AM & SHRI VIJAY PA L RAO, JM VK;DJ VIHY LA- @ ITA NO. 219/JP/2019 FU/KZKJ.K O'K Z @ ASSESSMENT YEAR : 2010-11 SHRI BHAWANI SINGH SHEKHAWAT 137, SAGAR ROAD, AMER, JAIPUR. CUKE VS. THE ITO, WARD-7(4) JAIPUR. LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO.: BGXPS 3521 F VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT FU/KZKFJRH DH VKSJ L S@ ASSESSEE BY : SHRI P.C. PARWAL (C.A.) JKTLO DH VKSJ LS @ REVENUE BY : SHRI A.K. MAHALA (JCIT) LQUOKBZ DH RKJH[ K@ DATE OF HEARING : 08/04/2019 MN?KKS'K.KK DH RKJH[ K@ DATE OF PRONOUNCEMENT: 10/04/2019 VKNS'K@ ORDER PER: VIJAY PAL RAO, J.M. THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER DATED 28.12.2018 OF THE LD. CIT(A), JAIPUR FOR THE ASSESS MENT YEAR 2010-11. THE ASSESSEE HAS RAISED THE FOLLOWING GROUND:- 1. THE LD. CIT(A) HAS ERRED ON FACTS AND IN LAW IN CONFIRMING THE ADDITION OF RS. 11,38,230/- BY TREATING THE SOURCE OF INVESTMENT IN AGRICULTURAL LAND TO THIS EXTENT AS UNEXPLAINED. ITA NO. 219/JP/2019 SHRI BHAWANI SINGH SHEKHAWAT VS. ITO 2 2. THE APPELLANT CRAVES TO ALTER, AMEND AND MODIFY ANY GROUND OF APPEAL. 3. NECESSARY COST BE AWARDED TO THE ASSESSEE. 2. THE ONLY ISSUE ARISES IN THIS APPEAL OF THE ASSE SSEE IS RELATING TO THE ADDITION OF RS. 11,38,230/- ON ACCOUNT OF UNEXP LAINED INVESTMENT IN THE PLOT OF LAND. DURING THE YEAR UNDER CONSIDERAT ION THE ASSESSEE HAS MADE INVESTMENT OF RS. 34,83,230/- (INCLUDING REGIS TRATION CHARGES OF RS. 1,83,230/-) IN PURCHASE OF IMMOVABLE PROPERTY S ITUATED AT 1/38, GOLIMAR GARDEN, AMER ROAD, JAIPUR. IN ORDER TO VERI FY THE SOURCE OF SAID INVESTMENT THE AO ASKED THE ASSESSEE TO EXPLAIN THE SOURCE. IN RESPONSE, THE ASSESSEE HAS SUBMITTED REPLY DATED 16 .06.2016 EXPLAINING THE SOURCE OF INVESTMENT IN PURCHASE OF THE PLOT OF LAND IN QUESTION. APART FROM SHOWING THE LOAN FROM RAJASTHA N TEXTILES DEVELOPMENT CORPORATION AS WELL AS FROM OTHER PERSO NS, THE ASSESSEE HAS ALSO EXPLAINED THE SOURCE OF SALE PROCEEDS OF A GRICULTURAL LAND ORIGINALLY OWNED BY THE FATHER OF THE ASSESSEE AND AFTER THE DEATH OF THE FATHER OF THE ASSESSEE, HIS BROTHER, SISTERS AN D MOTHER BECAME THE LEGAL HEIRS OF THE LAND. THE AO DID NOT ACCEPT THE SOURCE OF FUND FROM SALE OF AGRICULTURAL LAND AND CONSEQUENTLY MADE THE ADDITION OF RS. 11,83,230/- ON ACCOUNT OF UNEXPLAINED INVESTMENT IN THE HAND OF THE ITA NO. 219/JP/2019 SHRI BHAWANI SINGH SHEKHAWAT VS. ITO 3 ASSESSEE. THE ASSESSEE CHALLENGED THE ACTION OF THE AO BEFORE THE LD. CIT(A) AND REITERATED ITS CONTENTION THAT THE SOURC E OF RS. 11,83,230/- IS THE SALE PROCEEDS OF AGRICULTURAL LAND AS WELL A S ASSESSEES INCOME OF THE PAST YEARS. THE ASSESSEE ALSO FILED GIFT DEED F ROM THE THREE SISTERS OF THE ASSESSEE AS WELL AS MOTHER AND CLAIM THAT A SUM OF RS. 12 LACS RECEIVED BY THE ASSESSEE FROM THREE SISTERS AND MOT HER OUT OF THE SALE CONSIDERATION OF THE AGRICULTURAL LAND. THE LD. CIT (A) DID NOT ACCEPT THE CONTENTION OF THE ASSESSEE ON THE GROUND THAT THE L AND WAS SOLD IN THE YEAR 2006 AND THE PRESENT PLOT OF LAND WAS PURCHASE D IN THE YEAR 2009 THEREFORE, IT IS HIGHLY UNLIKE THAT THE SALE PROCEE DS OF THE LAND WAS KEPT IN HOUSE BY THE ASSESSEE AND DEPOSITED IN THE BANK ONLY AT THE TIME OF PURCHASE OF THE PLOT OF LAND IN THE YEAR 2009. THUS , THE LD. CIT(A) HAS CONFIRMED THE ADDITION MADE BY THE AO. 3. BEFORE US, THE LD. AR OF THE ASSESSEE HAS SUBMIT TED THAT THE ASSESSEE HAS MADE TOTAL INVESTMENT OF RS. 34,83,230 /- INCLUDING THE EXPENDITURE ON REGISTRY OUT OF WHICH RS. 28,00,000/ - WERE MADE BY CHEQUE AND PAYMENT OF RS. 6,83,230/- WAS MADE IN C ASH. SINCE, THE ASSESSEE ALSO DEPOSITED A SUM OF RS. 5,00,000/- BEF ORE ISSUING THE CHEQUE THEREFORE, THE AO AS MADE AN ADDITION OF RS. 11,83,230/-. THE SOURCE OF CASH PAYMENT AND CASH DEPOSIT IN THE BANK OF RS. 11,83,230/- ITA NO. 219/JP/2019 SHRI BHAWANI SINGH SHEKHAWAT VS. ITO 4 IS OUT OF THE SALE PROCEEDS OF AGRICULTURAL LAND SO LD ON 17.03.2006 FOR A CONSIDERATION OF RS. 18,66,000/-. FURTHER THE ASSES SEE HAS ALSO SHOWN THE SOURCE BEING SAVING FROM THE INCOME DECLARED FO R THE ASSESSMENT YEARS 2009-10 & 2010-11 OF RS. 3,53,690/- AND RS. 4 ,14,720/- RESPECTIVELY. THUS, THE LD. AR HAS SUBMITTED THAT T HE ASSESSEE HAS EXPLAINED THE SOURCE MORE THAN THE SAID AMOUNT OF R S. 11, 83,230/-. HE HAS REFERRED TO THE GIFT DEEDS EXECUTED BY THE MOTH ER AND THREE SISTERS WHO ARE CO-OWNERS OF THE LAND SOLD. THEREFORE, THE ASSESSEE WAS HAVING SUFFICIENT FUNDS TO THE DEPOSIT OF RS. 5,00, 000/- IN THE BANK ACCOUNT AND ALSO FOR MAKING PAYMENT OF RS. 6,83,230 /- IN CASH. THUS, THE LD. AR HAS SUBMITTED THAT THE ADDITION MADE BY THE AO AND CONFIRMED BY THE LD. CIT(A) MAY BE DELETED. 4. ON THE OTHER HANDS, THE LD. DR HAS SUBMITTED THA T THE LAND IN QUESTION WAS SOLD IN THE YEAR 2006 WHEREAS DEPOSITS WERE MADE IN THE BANK IN THE YEAR 2009 AS WELL AS THE CASH PAYMENT W AS MADE FOR PURCHASE OF LAND IN THE YEAR 2009. THEREFORE, IT CA NNOT BE ACCEPTED AS SOURCE OF THE DEPOSIT MADE IN THE BANK AS WELL AS C ASH PAYMENT FOR PURCHASE OF PLOT OF LAND AFTER THE GAP OF THREE YEA RS WHEN THE ASSESSEE HAS NOT GIVEN SATISFACTORY EXPLANATION FOR KEEPING THE CASH AT HOUSE FOR SUCH A LONG TIME. AS REGARDS SAVING FROM THE INCOME , THE LD. DR HAS ITA NO. 219/JP/2019 SHRI BHAWANI SINGH SHEKHAWAT VS. ITO 5 SUBMITTED THAT THE INCOME DECLARED BY THE ASSESSEE WAS NOT SUFFICIENT TO MEET EVEN HOUSEHOLD EXPENDITURE THEREFORE, THE C LAIM OF SAVING IS NOT ACCEPTABLE. HE HAS RELIED UPON THE ORDERS OF TH E AUTHORITIES BELOW. 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AS WELL AS RELEVANT MATERIAL ON RECORD. IN RESPONSE, TO THE SHOW CAUSE NOTICE ISSUED BY THE AO REGARDING THE SOURCE OF INVESTMENT OF RS. 34,83, 230/- FOR PURCHASE OF IMMOVABLE PROPERTY SITUATED AT 1/38 GOLIMAR GARD EN, AMER ROAD, JAIPUR THE ASSESSEE IN ITS REPLY DATED 16.06.2016 H AS GIVEN THE DETAILS AS UNDER :- DETAILS OF COST OF PURCHASE SOURCE OF INVESTMENT DATE MODE OF PAYMENT AMOUNT DATE OF RECEIPT PARTICULARS AMOUNT 21.05.2009 CHEQUE 5,00 ,000/ - 04.06.2009 LOAN FROM RAJASTHAN TEXTILES DEVEP. CORP. 8,00,000/ - 05.06.2009 CHEQUE 5,00,000/ - 04.06.2009 LOAN RECEIVED FROM RAJ KUMAR BALANCE AVAILABLE IN THE BANK OUT OF SALE PROCEED 2,00,000/ - 3,00,000/- 08.06.2009 13.06.2009 CHEQUE CHEQUE 5,00, 000/ - 5,00,000/- 06.06.2009 LOAN RECEIVED FORM MOHIT JEWELLERS 10,00,000/ - ITA NO. 219/JP/2019 SHRI BHAWANI SINGH SHEKHAWAT VS. ITO 6 06.07.2009 CHEQUE 5,00,000/ - 06.07.2009 CASH DEPOSIT IN BANK OUT OF SALE OF AGRICULTURE LAND IN 2006 5,00,000/ - 10.06.2009 CASH 5,00,000/ - 10.06.2009 CASH PAYMENT OUT OF SALE OF AGRICULTURE LAND IN 2006 5,00,000/ - 10.06.2009 CASH REGISTRY CHARGES 1,83,230/ - 10.06.2009 CASH EXPENSES OUT OF SALE OF AGRICULTURE LAND IN 2006 1,83,230/ - TOTAL PURCHASE COST 34,83,230/ - TOTAL SOURCE 34,83,230/ - THUS, FROM THE DETAILS FILED BY THE ASSESSEE THE AO NOTED THAT THE ASSESSEE HAS MADE A CASH PAYMENT OF RS. 6,83,230/- AND THE BALANCE PAYMENT WAS MADE THROUGH CHEQUE HOWEVER, THE ASSESS EE HAS ALSO MADE A DEPOSIT OF RS. 5,00,000/- IN CASH IN THE BAN K ACCOUNT BEFORE ISSUING THE CHEQUE DATED 06.07.2009. ACCORDINGLY, T HE AO PROPOSED TO MAKE THE ADDITION OF RS. 11,83,230/- ON ACCOUNT OF UNEXPLAINED INVESTMENT. THE ASSESSEE SUBMITTED THAT THE SOURCE OF THE SAID AMOUNT OF RS. 11,83,230/- WAS OUT OF SALE PROCEEDS OF AGRI CULTURAL LAND SOLD IN THE YEAR 2006 BY THE ASSESSEE, HIS BROTHER, MOTHER AND THREE SISTERS. THE AO NOTED THAT THE ASSESSEES SHARE IN THE SALE PROCEEDS OF LAND IS ONLY RS. 3,11,000/- AND THEREFORE, THE CLAIM OF THE ASSESSEE WAS NOT ITA NO. 219/JP/2019 SHRI BHAWANI SINGH SHEKHAWAT VS. ITO 7 ACCEPTED. ON APPEAL, THE ASSESSEE FILED THE GIFT DE ED FROM THREE SISTERS AND MOTHER GIVING THEIR SHARE IN THE SALE PROCEEDS OF AGRICULTURAL LAND TO THE ASSESSEE OF RS. 3,00,000/- EACH AND THEREBY THE ASSESSEE CLAIMED THAT THE SOURCE OF INVESTMENT TO THE EXTENT OF RS. 12,00,000/- WAS AVAILABLE WITH THE ASSESSEE ON ACCOUNT OF THESE GIFT OF THE SALE PROCEEDS OF AGRICULTURAL LAND MADE BY HIS MOTHER AN D THREE SISTERS. FURTHER, THE ASSESSEE HAS ALSO CLAIMED THAT THERE W AS A SAVING FROM THE DECLARED INCOME FROM THE ASSESSMENT YEARS 2009-10 A ND 2010-11 AS WELL AS WITHDRAWAL FROM THE BANK OF RS. 3,00,000/- ON 09.06.2009. THE DETAILS OF THE TOTAL SOURCE OF FUNDS AS CLAIMED BY THE ASSESSEE ARE AS UNDER:- 4. CONSIDERING THE ABOVE FACTS, THE ASSESSEE HAS AVAILABILITY OF CASH FUNDS OF RS. 25,79,410/- AS UNDER:- SHARE OF IN THE SALE PROCEEDS OF AGRICULTURAL LAND RS. 3,11,000/- GIFT FROM MOTHER AND SISTERS OUT OF SALE PROCEEDS O F AGRICULTURAL LAND RS. 12,00,000/- CASH WITHDRAWALS FROM BANK ON 09.06.2009 RS. 3,0 0,000/- INCOME DECLARED IN AY 2009-10 RS. 3,53,690/- INCOME DECLARED IN AY 2010-11 RS. 4,14,720/- TOTAL RS. 25,79,410/- AFTER GIVING A DEEP THOUGHT ON THE FACTS AND CIRCUM STANCES OF THE CASE AS WELL AS ANALYZING THE RELEVANT DETAILS, WE FIND THAT ONCE THE MOTHER ITA NO. 219/JP/2019 SHRI BHAWANI SINGH SHEKHAWAT VS. ITO 8 AND THREE SISTERS OF THE ASSESSEE HAVE CONFIRMED TH E GIFT TO THE ASSESSEE OUT OF THE SALE PROCEEDS IT IS CLEAR THAT THEY HAVE NOT CLAIMED THEIR SHARE IN THE SALE PROCEEDS OF THE AGRICULTURA L LAND AND CONSEQUENTLY THE ENTIRE SALE PROCEEDS REMAINED WITH THE ASSESSEE AND HIS BROTHER. THEREFORE, EVEN IF TAKING HALF SHARE O F THE SALE PROCEEDS OF RS. 18,66,000/- THE SHARE OF THE ASSESSEE COMES TO RS. 9,33,000/-. FURTHER, IT IS ALSO THE MATTER ON RECORD THAT AS PE R THE DETAILS OF THE BANK ACCOUNT THE ASSESSEE HAS CLAIMED WITHDRAWALS O F RS. 3,00,000/- ON 09.06.2009 WHICH IS PRIOR TO THE PAYMENT OF RS. 6,83,230/- ON ACCOUNT OF PURCHASE OF PLOT OF LAND IN QUESTION. TH EREFORE, EVEN WITHOUT CONSIDERING ANY SAVING FOR THE ASSESSMENT YEARS 200 9-10 AND 2010-11 IF THE, HALF SHARE IN THE SALE PROCEEDS OF AGRICULT URAL LAND AND THE BANK WITHDRAWALS MADE BY THE ASSESSEE OF RS. 3,00,000/- ON 09.06.2009 IS TAKEN INTO CONSIDERATION THE ASSESSEE HAS ESTABLISH ED THE AVAILABILITY OF FUNDS OF RS. 11,83,230/-. WHEN THERE IS NO OTHER US E OF SALE PROCEEDS OF AGRICULTURE LAND THEN THE SAID AMOUNT IS VERY MU CH AVAILABLE WITH ASSESSEE. WE FIND THAT AS PER THE BANK STATEMENT FI LED BY THE ASSESSEE AT PAGE 9 TO 18 OF THE PAPER BOOK THERE IS A WITHDR AWALS OF RS. 3,00,000/- ON 09.06.2009. HENCE, IN THE FACTS AND C IRCUMSTANCES OF THE CASE, WE HOLD THAT THE ASSESSEE HAS EXPLAINED THE S OURCE OF RS. ITA NO. 219/JP/2019 SHRI BHAWANI SINGH SHEKHAWAT VS. ITO 9 11,83,230/- ON ACCOUNT OF INVESTMENT MADE IN THE PU RCHASE OF PLOT OF LAND AND ACCORDINGLY THE ADDITION MADE BY THE AO IS DELETED. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 10/04/2019. SD/- SD/- JESK LH0 KEKZ FOT; IKY JKO (RAMESH. C. SHARMA) (VIJAY PAL RAO) YS[KK LNL;@ ACCOUNTANT MEMBER U;KF;D LNL;@ JUDICIAL MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 10/04/2019. * SANTOSH. VKNS'K DH IZFRFYFI VXZSFKR@ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ@ THE APPELLANT- SHRI BHAWANI SINGH SHEKHAWAT, JAIPUR . 2. IZR;FKHZ@ THE RESPONDENT- ITO, WARD-7(4), JAIPUR. 3. VK;DJ VK;QDR@ CIT 4. VK;DJ VK;QDR@ CIT(A) 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ@ DR, ITAT, JAIPUR. 6. XKMZ QKBZY@ GUARD FILE {ITA NO. 219/JP/2019} VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ@ ASST. REGISTRAR