MRS. PURNIMA PATNI, PUNE V. INCOME TAX OFFICER WARD-3(4), JAIPUR

ITA 234/JPR/2018

• Counselvise Citation: [2022] 106 COUNSELVISE.COM (IT) 1472 (ITAT-PUNE)
• Duration Of Justice: 4 year(s) 6 month(s) 14 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-08-2022
• Appeal Filed By: Assessee
• Order Result: PartlyAllowed
• Bench Allotted: A
• Assessment Year: 2009-2010
• Appeal Filed On: 14-02-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: HARI KRISHAN
• Keywords: Unexplained investment; Additional evidence; Capital Gains
• Section: 69; 271(1)(c); 144; 250

Judgement Text

आयकर अपीलीय अिधकरण “ए” Ɋायपीठ पुणे मŐ। IN THE INCOME TAX APPELLATE TRIBUNAL “A” BENCH, PUNE BEFORE SHRI S.S.GODARA, JUDICIAL MEMBER AND DR. DIPAK P. RIPOTE, ACCOUNTANT MEMBER आयकर अपीलसं. / ITA No’s.234 & 235/JPR/2018 िनधाᭅरणवषᭅ / Assessment Years : 2009-10 Mrs. Purnima Patni, Plot No.604A, Akashganga Society, Rahetani, Pimple Soudagar, Pune – 411017. PAN: ADUPP 9192 P Vs . The ITO, Ward-3(4), Jaipur. Appellant/ Assessee Respondent /Revenue Assessee by Shri Hari Krishan – AR Revenue by Shri Arvind Desai – DR Date of hearing 12/08/2022 Date of pronouncement 29/08/2022 आदेश/ ORDER Per S.S.Godara, JM: 1. These assessee’s twin appeals for assessment year 2009-10 arise against the CIT(A)-1, Jaipur’s separate orders; both dated 09.11.2017, passed in case no.s:92/2013-14 and 189/2013-14 involving proceedings under section 144 and 271(1)(c) of the Income Tax Act, 1961 (in short “the Act”), respectively. Heard both the parties. Case files perused. 2. It emerges at the outset that the assessee’s instant twin appeals suffer from identical delay of 03 days each stated to be attributable to communication gap with the arguing counsel. The same is found to be neither intentional nor deliberate and stands condoned therefore. ITA No’s.234 & 235/JPR/2018 for A.Y. 2009-10 (A) Mrs.Purnima Patni 2 3. We next note that the assessee’s former quantum appeal ITA No.234/JP/2018 raises her sole substantive ground challenging correctness of both the lower authorities’ action making section 69 unaccounted investment addition of Rs.23,24,000/- in the course of section 144 assessment dated 26.12.2011 as upheld in the CIT(A)’s order reading as follows: “(iv) The relevant extract of rejoinder of the AR to the remand report of the AO is reproduced as under: The appellant had deposited a sum of Rs.23,24,000 in her bank account in cash as detailed below:- 09.05.2008 15,00,000 16.05.2008 7,50,000 26.05.2008 74,000 The above said sum was deposited by the appellant out of cash received from Shri Babulal Gurnani against sale of property situated at plot no. 495, Adarsh nagar, Jaipur. The assessee, her husband, her son and daughter in law (who were joint owners of property situated at plot no. 495, Adarsh Nagar, Jaipuir) had executed an Agreement to sale for 250 sq. yards of land of the said property vide Agreement dated 17/03/2008 as per which the said part of total land was agreed to to be sold for Rs. 54.00 Lacs and the buyer Shri Babulal Gurnani haa paid Rs. 40.00 Lacs to the co owners out of which Rs. 26.00 Lacs were received through cheques and Rs. 14.00 Lacs was paid in cash. As per this Agreement the balance consideration was agreed to be paid within 45 days which were to expire on 1 st May, 2008. On 25 th April, 2008 i.e. just six days prior to expiry of said time schedule, all the co owners had executed a registered power of attorney favouring Shri Babu Lai Gurnani. The appellant could not trace out the sale deed of the said property but the said fact of executing registered power of attorney proves that the said Shri Babu Lai Gurnani had paid Rs. 14,00,000 to the appellant against the property. In this way the assessee had Rs. 28,00,000 with her which belonged to her and her other family persons. As is apparent from the bank statements of all other members no cash was deposited in their account and the whole amount was deposited in the ITA No’s.234 & 235/JPR/2018 for A.Y. 2009-10 (A) Mrs.Purnima Patni 3 bank account of the appellant. It is therefore sincerely requested that the said cash deposit may please be treated as explained and addition made by the Id. AO may please be deleted. ’’ (V) I have duly considered the submissions of the appellant, remand report of the AO and its rejoinder by the AR and the material placed on record and I find merit in the comments of the AO. It is to be noted that the ‘Agreement to Sell’ dated 17/03/2008 executed by the appellant and other co-owners was only for half portion of the property situated at plot No. 425, Adarsh Nagar, Jaipur for a consideration of Rs. 54 lakh, out of which a sum of Rs. 40 lakh appeared to be received on 17.03.2008, including cash amount of Rs. 14 lakh. However, a registered power of attorney was issued by the appellant along with other co-owners in favour of Shri Babulal Gurnani on 25/04/2008 for the entire plot of 500 square yards. The appellant has not brought on record any evidence which may indicate that a sum of Rs. 14 lakh was paid by the power-of- attorney holder Shri Babulal Gurnani on 25.04.2008. It has not brought on record any evidence which may indicate why initially the ‘Agreement to Sell' was made for only half portion of the property under consideration and why only after a few days, a power-of- attorney was executed in favour of Shri Babulal Gurnani for the entire property. It has also not brought on record any evidence which may suggest that the ‘Agreement to Sell’ dated 17/03/2008 was finally registered or not. (vi) It appears that the appellant has not come forward with clean hands even during the appellate proceedings as it has submitted only a part of the information and it could be presumed that the disclosure of the complete information would adversely affect the case of the appellant. It has not stated in clear terms that whether the property was sold to Shri Babu Lai Gurnani or just a power of attorney was issued for the whole property or the whole property was sold and if yes, what was its sale consideration etc. (vii) It is pertinent to mention here that in its return of income filed on 31/07/2009 for the year under consideration, the appellant has not shown any computation relating to long-term capital gain on sale of the property under consideration, not to speak of declaration of any long term capital gains thereof. (viii) It was claimed by the appellant that out of cash amount of Rs. 28 lakh, a sum of Rs. 23.24 lakh was deposited in her bank account. The appellant has filed bank accounts of other family members in order to establish that no cash was deposited therein. However, it is noted that no confirmation was filed by the appellant from the other co-owners, who are its family members only to the effect that they had given the cash of Rs. 23.24 lakh out of the sale ITA No’s.234 & 235/JPR/2018 for A.Y. 2009-10 (A) Mrs.Purnima Patni 4 proceeds to the appellant. Even the appellant has not filed the copies of income tax returns of other family members for the year under consideration to indicate that they have shown the long-term capital gains on the sale of the property under consideration thereof. The appellant has not filed any confirmation from Shri Babu Lai Gurnani that he had made the cash payment of Rs. 14 Lakh on 25.04.2008 i.e. the date of execution of power of attorney by the appellant and other coowners in the favour of Shri Babulal Gurnani. It may be mentioned that the onus is on the appellant to prove the source of cash deposits in its bank account. In the instant case under consideration, the appellant has failed miserably to prove the source of cash deposits in its bank account. (ix) Therefore, in view of the above discussion and looking to the totality of facts and circumstances the case, it is held that the AO was justified in making addition of Rs. 23.24 lakh to the income of the appellant u/s 69 of the Act and thus the same is hereby sustained.” 4. We have given our thoughtful consideration to vehement rival contentions against and in support of the impugned unexplained investment addition. Suffice to say, this sum in issue of Rs.23.24 lakhs represents the assessee’s cash deposits made in her bank account on 09, 16 & 26 th May 2008 involving Rs.15 lakhs, Rs.7.5 lakhs and Rs.74,000/-; respectively. Her stand all along has been that she had received cash of Rs.14 lakhs from one Mr.Gurnani in lieu of agreement to sell(supra). Mr.Harikishan reiterated the very fact before us as well in light of the assessee’s family member’s affidavits to this effect which have been sought to be placed as additional evidence. 5. We find no merit in assessee’s stand. This is for the clinching reason that there is no indication in the above stated agreement to sell or the latter instrument (power of attorney) dated 25.04.2008 that the ITA No’s.234 & 235/JPR/2018 for A.Y. 2009-10 (A) Mrs.Purnima Patni 5 assessee herself had accepted the entire cash sum of Rs.14 lakhs; which in turn, forms source of the cash deposits herein amounting to Rs.23.24 lakhs. The fact also remains that she deserves credit to the extent of her share in the foregoing cash amount of Rs.14 lakhs. Faced with this situation, we grant part relief to the assessee to the limited extent that the Assessing Officer shall ascertain the assessee’s share in the immoveable property forming subject matter of the agreement to sell dated 17.03.2008 as well as power of attorney dated 25.04.2008 and thereafter apportion the cash sum of Rs.14 lakhs which’ll be treated as source of her cash deposits in issue. We make it clear in other words that we have granted part relief to the assessee to the extent of her share in the cash amount of Rs.14 lakhs received vis-a-viz the agreement to sell. Necessary computation shall follow as per law. This former appeal in ITA No.234/JP/2018 is partly accepted in very terms. 6. Next comes the corresponding penalty appeal ITA No.235/JP/2018 involving the sum in issue of Rs.7,57,282/-. The Revenue could hardly dispute the settled legal proposition in light of CIT vs. Reliance Petro Products Pvt. Ltd. 322 ITR 158 (SC) that quantum and penalty are parallel proceedings wherein any disallowance / addition made course of the former does not ipso facto attract the latter penal provision. We keep in mind this fine ITA No’s.234 & 235/JPR/2018 for A.Y. 2009-10 (A) Mrs.Purnima Patni 6 distinction and note that the assessee has led her oral as well as documentary evidence that the cash deposits in issue of Rs.23.24 lakhs have arisen from the cash amounts received from Mr.Gurnani only in lieu of executing agreement to sell / power of attorney(supra). We thus conclude that she has indeed filed justifiable explanation atleast in the impugned penalty proceedings throwing sufficient light on source of the quantum cash deposits. This penalty of Rs.7,57,282/- stands delete therefore. Ordered accordingly. 7. To sum up, the assessee’s quantum appeal ITA No.234/JP/2018 is partly allowed for statistical purposes and penalty appeal ITA No.235/JP/2018 is allowed in above terms. A copy of this common order be placed in the respective case files. Order pronounced in the open Court on 29 th August, 2022. Sd/- Sd/- (DR. DIPAK P. RIPOTE (S.S.GODARA) ACCOUNTANT MEMBER JUDICIAL MEMBER पुणे / Pune; ᳰदनांक / Dated : 29 th Aug, 2022/ SGR* आदेशकᳱᮧितिलिपअᮕेिषत / Copy of the Order forwarded to : 1. अपीलाथᱮ / The Appellant. 2. ᮧ᭜यथᱮ / The Respondent. 3. The CIT(A), concerned. 4. The Pr. CIT, concerned. 5. िवभागीयᮧितिनिध, आयकर अपीलीय अिधकरण, “ए” बᱶच, पुणे / DR, ITAT, “A” Bench, Pune. 6. गाडᭅफ़ाइल / Guard File. आदेशानुसार / BY ORDER, // TRUE COPY // Senior Private Secretary आयकर अपीलीय अिधकरण, पुणे/ITAT, Pune.