ACIT Range-I, Moradabad V. Kalpana Bansal, Moradabad

ITA 2392/DEL/2008

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 7292 (ITAT-DELHI)
• Duration Of Justice: 7 year(s) 7 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-02-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: F
• Next Hearing Date: 02-02-2016
• Assessment Year: 2003-2004
• Appeal Filed On: 24-06-2008
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Gift; Income from undisclosed sources; Source of fund; Additional evidence
• Section: 143(3); 68; 56

Judgement Text

PAGE | 1 INCOME TAX APPELLATE TRIBUNAL DELHI BENCH F : NEW DELHI BEFORE SHRI AMIT SHUKLA , JUDICIAL MEMBER AND SHRI PRASHANT MAHARISHI, ACCOUNTANT MEMBER ITA NO. 2391/DEL/2008 (ASSESSMENT YEAR: 2003 - 04 ) ACIT, RANGE - I, MORADABAD VS. SHRI PANKAJ RAJ BANSAL, MORADABAD (APPELLANT) (RESPONDENT) ITA NO. 2429/DEL/2008 (ASSESSMENT YEAR: 2003 - 04) SHRI PANKAJ RAJ BANSAL, MORADABAD VS. ACIT, RANGE - I, MORADABAD (APPELLANT) (RESPONDENT) ITA NO. 2428/DEL/2008 (ASSESSMENT YEAR: 2003 - 04) SMIT KALPANA BANSAL, W/O. SHRI PAWAN KUMAR BANSAL, KATRA NAJ, MORADABAD PAN:ADHPB7327H VS. ACIT, RANGE - I, MORADABAD (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI ATIQ AHMAD, SR. DR REVENUE BY: NONE DATE OF HEARING 31/10/ 2017 DATE OF PRONOUNCEMENT 0 4 / 0 1 / 2 0 1 8 O R D E R PER PRASHANT MAHARISHI , A. M. THESE ARE THE THREE APPEALS FOR SAME ASSESSMENT YEAR IN CASE OF GROUP ASSESSEE AND IDENTICAL ISSUES ARE INVOLVED, THEY ARE HEARD TOGETHER AND ARE DISPOSED OFF BY THIS COMMON ORDER. ITA NO 2391 & 2429/DEL/2008 A Y 2003 - 04 RE: - PANKAJ BANSAL ACIT,VS.SHRI PANKAJ RAJ BANSAL ITA NO. 2 3 91&2429/ DEL/2008 MRS. KALPANA BANSAL ITA NO. 2428/DEL/2008 ASSESSMENT YEAR: 2003 - 04) PAGE | 2 1. THESE ARE THE APPEALS FILED BY THE ASSESSEE AND REVENUE AGAINST THE ORDER OF THE LD CIT ( A ) - BAREILLY DATED 18.03.2008 FOR THE ASSESSMENT YEAR 2003 - 04. 2. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL IN ITA NO . 2391/DEL/2008 FOR THE ASSESSMENT YEAR 2003 - 04 : - 1. LD. COMMISSIONER OF INCOME TAX (APPEAL), BAREILLY HAS ERRED IN LAW AND THE FACTS OF THE CASE IN ALLOWING RELIEF TO THE ASSESSEE IN TREATING THE SUM OF RS. 565000/ - AS AN AGRICULTURAL INCOME WHICH WAS RIGHTLY TREATED BY THE AO AS AN INCOME FROM UNDISCLOSED SOURCES. 2. LD COMMISSIONER OF INCOME TAX (APPEAL), BAREILLY HAS ERRED IN LAW AND THE FACTS OF THE CASE IN ALLOWING RELIEF TO THE ASSESSEE IN TREATING THE SUM OF RS. 3005000/ - AS GENUINE GIFTS WHICH WERE RIGHTLY TREATED BY THE AO AS AN INCOME FROM OTHER S OURCES. 3. ORDER PASSED BY THE LD COMMISSIONER OF INCOME TAX (APPEAL), BAREILLY IN RESPECT OF THE ABOVE ASPECTS MAY BE SET - ASIDE AND THE ORDER PASSED BY THE ASSESSING OFFICER MAY BE RESTORED. 3. THE REVENUE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL IN ITA NO. 2429/DEL/2008 FOR THE ASSESSMENT YEAR 2003 - 04: - 1. THAT THE LOWER AUTHORITIES WERE NOT JUSTIFIED IN ASSESSING AGRICULTURAL INCOME OF RS. 130000/ - AND RS. 160000/ - OF SALE OF EUCALYPTUS TREES 300 AND 500 NUMBERS AS INCOME FROM OTHER SOURCES U/S 56. 2. THAT SMT SHANTI AGARWAL GIFTED RS. 20000/ - TO DAUGHTER OF THE APPELLANT. HER IDENTIFY, SOURCE OF INVESTMENT AND PAYING CAPACITY IS PROVED. SHE HAD GIVEN AFFIDAVIT AND GIFT DEED INN TOKEN OF GIFT. THEREFORE, THE ACIT AS WELL AS CIT(A) HAVE NOT JUSTIFIED IN REJECTING GIFTS OF RS. 2 LACS AND ASSESSING THE AMOUNT AS INCOME AS INCOME FROM OTHER SOURCES U/S 56. 4. THESE TWO ABOVE APPEALS ARE FILED BY THE REVENUE AND ASSESSEE AGAINST THE ORDER OF THE CIT ( A), BAREILLY FOR ASSESSMENT YEAR 2003 - 04. THE FACTS STATED ARE THAT ASSESSEE IS AN INDIVIDUAL WHO FILED HIS RETURN OF INCOME ON 01.12.2003 SHOWING INCOME OF RS. 368550/ - . DURING THE YEAR, THE ASSESSEE HAS SHOWN INCOME OF RS. 725000/ - ON ACCOUNT OF AGRICULTURAL INCOME . THE LD ASSESSING OFFICER DISPUTED THE SAME. TH E ASSESSEE SUBMITTED THAT ASSESSEE HAS SOLD 1800 TREES TO 18 PERSONS. ALL THESE PERSONS ARE FROM VILLAGE RAMPUR AND THEREFORE, THE ASSESSING OFFICER ACIT,VS.SHRI PANKAJ RAJ BANSAL ITA NO. 2 3 91&2429/ DEL/2008 MRS. KALPANA BANSAL ITA NO. 2428/DEL/2008 ASSESSMENT YEAR: 2003 - 04) PAGE | 3 ASKED THE ASSESSEE TO PRODUCE ALL THESE PERSONS FOR EXAMINATION, WHICH ASSESSEE EXPRESSED ITS INABILITY. TH EREFORE, THE ASSESSING OFFICER GOT ENQUIRY CONDUCTED BY THE INSPECTOR, WHICH SHOWED THAT THESE PERSONS COULD NOT BE TRACED IN VIEW OF INCOMPLETE ADDRESS. THEREFORE, THE ASSESSING OFFICER MADE ADDITION OF THE ABOVE SUM AND PASSED THE ASSESSMENT ORDER MAKING AN ADDITION AS INCOME FROM UNDISCLOSED SOURCES . FURTHER DURING THE YEAR GIFT OF RS. 32.50 LACS WAS RECEIVED BY THE MINOR CHILDREN OF THE ASSESSEE. IN ABSENCE OF ANY RELATIONSHIP AND FOR THE REASON THAT DONORS HAVE DEPOSITED CASH BEFORE GIVING THE GIFT T HE LD ASSESSING OFFICER HELD THAT SUCH GIFT IS ALSO CHARGEABLE TO TAX U/S 56(2)(V) OF THE INCOME TAX ACT. CONSEQUENTLY, ASSESSMENT ORDER U/S 143(3) OF THE ACT WAS PASSED ON 21.02.2006 DETERMINING TOTAL INCOME OF RS. 4343546/ - AGAINST RETURNED INCOME OF RS. 157327/ - . THE ASSESSEE PREFERRED APPEAL BEFORE THE LD CIT ( A), WHO HELD THAT A SUM OF RS. 435000/ - COULD NOT TREATED AS AGRICULTURAL INCOME AND RS. 290000/ - MAY BE TREATED AS INCOME FROM OTHER SOURCES. WITH RESPECT TO THE GIFT, HE DELETED THE ADDITION HOL DING THAT THERE IS NO NEED OF ANY BLOOD RELATION FOR THE GIFT. HE FURTHER HELD THAT ALL THE DONORS HAVE SHOWN THE SOURCE. IN VIEW OF THIS REVENUE AGGRIEVED HAS PREFERRED APPEAL BEFORE US. 5. THE LD DEPARTMENTAL REPRESENTATIVE SUBMITTED THAT THE LD CIT ( A) HA S DECIDED THE ISSUE BY ADMITTING THE ADDITIONAL EVIDENCES AS PER PAGE NO. 4 OF HIS ORDER WITHOUT RECORDING ANY REASONS FOR ADMISSION OF THE SAME. HE THEREFORE, SUBMITTED THAT THE CIT ( A) HAS WRONGLY ADMITTED THE ADDITIONAL EVIDENCES. HE FURTHER STATED THAT WHEN THE LD ASSESSING OFFICER HAS MADE ADDITION OF THE AGRICULTURAL INCOME AS UNDISCLOSED INCOME THE LD CIT(A) HAS CONVERTED IT INTO INCOME FROM OTHER SOURCES WITHOUT ANY REASONS. HE SUBMITTED THAT OUT OF THE TOTAL AGRICULTURAL INCOME OF RS 7.25 LAKHS LD CIT (A ) HAS CONFIRMED RS 2,90,000/ - AS INCOME FROM OTHER SOURCES WHERE AS FOR THE BALANCE AMOUNT HE HAS ACCEPTED THAT, IT IS AN AGRICULTURAL INCOME. HENCE, ASSESSEE IS IN APPEAL FOR RS 2,90,000/ - STATING THAT IT IS AGRICULTURAL INCOME AND REVENUE IS CONTES TING THAT ACCEPTANCE OF ACIT,VS.SHRI PANKAJ RAJ BANSAL ITA NO. 2 3 91&2429/ DEL/2008 MRS. KALPANA BANSAL ITA NO. 2428/DEL/2008 ASSESSMENT YEAR: 2003 - 04) PAGE | 4 AGRICULTURAL INCOME OF BALANCE SUM IS NOT CORRECT. HE REITERATED THE ARGUMENTS AS STATED IN ASSESSMENT ORDER. 6. WITH RESPECT TO THE ADDITION ON ACCOUNT OF GIFT HE SUBMITTED THAT PROVISIONS OF SECTION 56(2)(V) OF THE ACT HAS BEEN I GNORED BY THE LD CIT(A) AND HAS NOT GIVEN ANY REASON THAT WHY THAT PARTICULARS SECTION IS NOT APPLICABLE. HE STATED THAT NO DONORS ARE RELATED TO THE ASSESSEE AND HENCE, THE ADDITION SHOULD HAVE BEEN CONFIRMED. HE FURTHER SUBMITTED THAT SECOND GROUND OF AP PEAL OF ASSESSEE IS WITH RESPECT TO THE ADDITION OF RS 2 LAKHS ON ACCOUNT OF ONE DONOR, WHICH COULD NOT BE PROVED BY THE ASSESSEE AS A GIFT. HE REITERATED THE FINDINGS OF THE LD AO FOR THE ADDITION DELETED BY CIT (A) AND OF LOWER AUTHORITIES OF THE ADDICTION OF RS 2 LAKHS ON WHICH ASSESSEE IS IN APPEAL. 7. DESPITE NOTICE, NONE APPEARED ON BEHALF OF THE ASSESSEE AND BECAUSE THIS APPEAL WAS FILED IN 2008 IS PENDING MOST OF TIMES BECAUSE OF THEN AR ON BEHALF OF THE ASSESSEE - SOUGHT ADJOURNMENTS. FURTH ER, FROM 2014 DESPITE APPEAL BEING ADJOURNED FOR AT LEAST FIVE TIMES , NOBODY RESPONDED , THEREFORE , THE MATTER IS DECIDED ON THE BASIS OF INFORMATION AVAILABLE ON RECORD . 8. WE HAVE CAREFULLY CONSIDERED THE RIVAL CONTENTIONS AND PERUSED THE ORDERS OF THE LOWE R AUTHORITIES. 9. ON THE FIRST ISSUE AS PER GROUND NO 1 OF APPEAL OF REVENUE AND GROUND NO 1 OF APPEAL OF ASSESSEE , ASSESSEE HAS SHOWN INCOME OF RS. 7.25 LACS ON ACCOUNT OF AGRICULTURAL INCOME ON SALE PROCEEDS OF 1800 TRESS ON THE LAND IN JOINT NAME WITH THREE OTHER PERSONS. THE ASSESSEE HAS SHOWN THE OWNERSHIP OF THE LAND; HOWEVER, THE ONLY DISPUTE IS WITH RESPECT TO THE MONEY SHOWN TO HAVE BEEN EARNED ON SALE OF THE TREES. THE ASSESSEE STATED THAT 500 TREES HAVE BEEN SOLD TO FIVE PERSONS FOR RS. 160000/ - , WHEREAS, 1300 TREES ARE SOLD TO 13 PERSONS FOR RS. 565000/ - . N O EVIDENCE PRODUCED BY THE ASSESSEE WITH RESPECT TO THE EXPENDITURE INCURRED. BEFORE THE LD ASS ESSING OFFICER ASSESSEE COULD NOT PRODUCE THOSE PERSONS AND EXPRESSED HIS INABILITY, HOWEVER, BEFORE THE LD CIT ( A) ACIT,VS.SHRI PANKAJ RAJ BANSAL ITA NO. 2 3 91&2429/ DEL/2008 MRS. KALPANA BANSAL ITA NO. 2428/DEL/2008 ASSESSMENT YEAR: 2003 - 04) PAGE | 5 HE SUBMITTED CERTAIN ADDITIONAL EVIDENCES, WHICH WERE ADMITTED. THE LD CIT ( A) HAS HELD THAT IN CASE OF THE LAND WHERE 1/3 SHARE IS WITH THE ASSESSEE , COPY OF REVENUE RECORDS SHOWS EXISTENCE OF 3000 TRESS. WITH RESPECT TO ANOTHER LAND, THE LD CIT ( A) HAS FINDING THAT ONLY 500 TREES ARE EXISTING. THEREFORE, HE ONLY GRANTED RELIEF OF 435000/ - OUT OF RS. 7.25 LACS. THE REVENUE STATED THAT LD CIT (A) HAS NOT VERIFIED THE BUYERS AND ASSESSEE COULD NOT SHOW ANY PROOF OF THE SALE OF TREES. DESPITE THIS CIT (A ) HAS ACCEPTED THE SALES. IT IS A MATTER OF FACT THAT THE ISSUE INVOLVED IN THE APPEAL IS NOT ABOUT THE EXISTENCE OF THE TREES, BUT WHETHER THE AMOUNT CREDITED IN THE BOOKS OF ASSESSEE IS EMANATING FROM THOSE PERSONS TO WHOM THE ASSESSEE HAS MENTIONED AS ALLEGED BUYERS OF THE TREES. FURTHER MERELY BECAUSE THE REVENUE RECORDS SHOW SOME TREES THE NUMBER OF TREES COULD NOT BE VERIFIED AS IT IS NO T MENTIONED THERE IN. MERE OWNERSHIP OF THE LAND IS NOT THE PROOF OF AGRICULTURAL INCOME. FURTHER, WHEN THE ASSESSEE HAS PLANTED THOSE TREES, HE MIGHT HAVE INCURRED SOME EXPENSES FOR SUCH A LARGE NUMBER OF TREES AND MAINTAINED THEM; THERE IS NO PROOF OF ANY EXPENSES INCURRED BY THE ASSESSEE ON PLANTS AS WELL ON ITS MAINTENANCE. FURTHER, THE LD CIT (A) HAS ADMITTED THE ADDITIONAL EVIDENCES WITHOUT GIVING THE REASON FOR ADMITTING THEM IN TERMS OF RULE 46A OF THE INCOME TAX RULES, 1962. THEREFORE, WE COULD NOT CONVINCE OURSELVES WITH THE ORDER OF THE LD CIT ( A) WITH RESPECT TO THE QUANTIFICATION. FURTHER, WHEN THE LD AO HAS HELD SUCH INCOME TO BE INCOME FROM UNDISCLOSED SOURCES, THE LD CIT (A) HAS ACCEPTED THE SAME AS INCOME FROM OTHER SOURCES WITHOUT ANY REASONING. THEREFORE, WE SET ASIDE THE WHOLE ISSUE BACK TO THE FILE OF THE LD CIT ( A) TO REEXAMINE THE WHOLE ISSUE OF AGRICULTURAL INCOME OF RS 72500 0/ - WITH RESPECT TO THE SALES OF TREES . FURTHER ASSESSEE IS ALSO DIRECTED TO SHOW THE SOURCES OF INCOME BY PRODUCING NECESSARY EVIDENCE OF SOURCES OF INCOME AND PERSONS WHO IT IS RECEIVED. NEEDLESS TO SAY THE LD CIT (A) WILL PROVIDE ADEQUATE OPPORTUN ITY OF HEARING TO ASSESSEE AS WELL LD AO. IN VIEW OF THIS ACIT,VS.SHRI PANKAJ RAJ BANSAL ITA NO. 2 3 91&2429/ DEL/2008 MRS. KALPANA BANSAL ITA NO. 2428/DEL/2008 ASSESSMENT YEAR: 2003 - 04) PAGE | 6 GROUND NO. 1 OF THE APPEAL OF THE REVENUE AS WELL AS OF THE ASSESSEE IS PARTLY ALLOWED. 10. WITH RESPECT TO GROUND NO. 2 ABOUT THE ADDITION OF GIFT OF RS. 305 0 000/ - DELETED BY LD CIT (A) ON WHICH REVENUE IS IN APPEAL AND R LAKSH WHICH IS CONFIRMED BY THE LD CIT (A) , FACTS SHOWS THAT ASSESSEE HAS RECEIVED GIFT FROM SIX PERSONS AMOUNTING TO RS. 32.50 LACS IN THE NAME OF THREE MINOR DAUGHTERS. THE LD ASSESSING OFFI CER HAS MADE ADDITION U/S 56 HOLDING THAT NONE OF THE DONORS IS HAVING ANY RELATIONS, ABSENCE OF ANY OCCASION, DEPOSITING MONEY IN CASH PRIOR TO GIFT, NON PRODUCTION OF ANY OF THE PERSON. ACCORDING TO THE LD ASSESSING OFFICER GIFT FROM NON RELATED PARTIES AS PER SECTION 56(2)(V) IS CHARGEABLE TO TAX AS INCOME FROM OTHER SOURCES. THE LD CIT ( A) DELETED THE ADDITION HOLDING THAT THERE IS NO NEED OF ANY OCCASION OR BLOOD RELATION FOR GIVING GIFT. HE EXAMINED THE ISSUE FROM THE PERSPECTIVE OF THE CASH CREDIT T O DELETE THE ADDITION OF RS 30.50 LAKHS AND TO CONFIRM THE ADDITION OF RS 2 LAKHS. AS THE PROVISIONS OF SECTION 5 6(2 ) ( V) HAVE BEEN INSERTED W.E.F. 01.04.2005 AND THE APPEAL BEFORE US PERTAINS TO ASSESSMENT YEAR 2003 - 04 THE PROVISIONS OF THAT SECTION DO ES NOT APPLY. WE MAKE IT CLEAR THAT ONLY GRIEVANCE OF THE REVENUE IS CHARGEABILITY OF ABOVE GIFT U/S 56 OF THE ACT AND NOT ABOUT IDENTITY, CREDITWORTHINESS, AND GENUINENESS OF THE DONORS. IT IS ALSO NOT THE CASE OF THE REVENUE THAT AMOUNT IS ADDED U/S 68 OF THE ACT. IN FACT LD AO HIMSELF HAS MADE ADDITION U/S 56 OF THE ACT. AS WE HAVE ALREADY HELD THAT SECTION 56 DOES NOT APPLY TO THE IMPUGNED AY AND FURTHER LD AO HAS NOT MADE ADDITIONS U/S 68 OF THE ACT BUT AS INCOME FROM OTHER SOURCES, WE DO NOT HAVE ANY OTHER ALTERNATIVE BUT TO CONFIRM THE FINDING OF THE LD CIT (A) FOR DELETION OF ADDITION OF RS 30.50 LAKHS AND REVERSE HIS FINDING FOR CONFIRMING THE ADDITION OF RS 2 LAKHS RECEIVED FROM SHRIMATI SHANTI AGARWAL. IN THE RESULT GROUND NO. 2 OF THE APPEAL OF THE REVENUE IS DISMISSED AND OF ASSESSEE IS ALLOWED. 11. IN THE RESULT APPEAL OF THE ASSESSEE AND REVENUE ARE PARTLY ALLOWED FOR STATISTICAL PURPOSES . ACIT,VS.SHRI PANKAJ RAJ BANSAL ITA NO. 2 3 91&2429/ DEL/2008 MRS. KALPANA BANSAL ITA NO. 2428/DEL/2008 ASSESSMENT YEAR: 2003 - 04) PAGE | 7 ITA NO 2429/ DEL/2008 KALPANA BANSAL V S. ACIT A Y 2003 - 04 12. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL IN ITA NO. 2428 /DEL/2008 FOR THE ASSESSMENT YEAR 2003 - 04: - 1. THAT THE LOWER AUTHORITIES WERE NOT JUSTIFIED IN ASSESSING AGRICULTURAL INCOME OF RS. 130000/ - OF SALE OF EUCALYPTUS TREES 300 NUMBERS AS INCOME FROM OTHER SOURCES U/S 56. 13. IN THE PRESENT APPEAL ASSESSEE HAS SHOWN AGRICULTURAL INCOME OF RS 565000/ - ON SALE OF TREES. THE LD AO HAS TREATED IT AS INCOME FROM UNDISCLOSED SOURCES. THE LD CIT (A) ACCEPTED THAT ASSESSEE HAS AGRICULTURAL INCOME O F RS 435000/ - BUT AGREED WITH THE LD AO FOR BALANCE SUM OF RS . 130000/ - TAXED AS UNDISCLOSED INCOME AGAINST WHICH ASSESSEE IS IN APPEAL. REVENUE COULD NOT SHOW US THAT LD AO HAS FILED APPEAL AGAINST THE ORDER OF THE LD CIT (A) ACCEPTING AGRICULTURAL I NCOME OF RS 435000/ - . AS WE HAVE SET ASIDE THE IDENTICAL ISSUE TO THE FILE OF THE LD CIT (A) IN CASE OF SHRI PANKAJ BANSAL BY THIS ORDER, IN THE INTEREST OF JUSTICE, WE SET ASIDE THE APPEAL OF THE ASSESSEE BACK TO FILE OF THE LD CIT (A ) WITH SIMILAR DIRECT ION. IN THE RESULT, SOLITARY GROUND APPEAL OF ASSESSEE IS ALLOWED ACCORDINGLY . 14. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 0 4 / 0 1 / 2 0 1 8 - S D / - - S D / - ( AMIT SHUKLA ) (PRASHANT MAHARISHI) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 0 4 / 0 1 / 2 0 1 8 A K KEOT COPY FORWARDED TO 1. APPLICANT 2. RESPONDENT 3. CIT 4. CIT (A) ACIT,VS.SHRI PANKAJ RAJ BANSAL ITA NO. 2 3 91&2429/ DEL/2008 MRS. KALPANA BANSAL ITA NO. 2428/DEL/2008 ASSESSMENT YEAR: 2003 - 04) PAGE | 8 5. DR:ITAT ASSISTANT REGISTRAR ITAT, NEW DELHI