Shri Govindbhai G. Bharwad, Ahmedabad V. The Dy.CIT, Circle-6, Ahmedabad

ITA 2436/AHD/2015

• Counselvise Citation: [2021] 108 COUNSELVISE.COM (IT) 9084 (ITAT-AHMEDABAD)
• Duration Of Justice: 5 year(s) 6 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-03-2021
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: B
• Next Hearing Date: 19-03-2020
• Assessment Year: 2011-2012
• Appeal Filed On: 14-08-2015
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: R R MAKWANA
• Assessee Lawyers: S N DIVETIA
• Keywords: Unexplained cash credit; Sale consideration of property below Jantri Value; Capital asset; Retrospective amendment; Capital Gains
• Section: 50C; 40(a)(ia); 201; 48; 68

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL , B BENCH, AHMEDABAD (CONDUCTED THROUGH VIRTUAL COURT AT AHMEDABAD) BEFORE SHRI WASEEM AHMED , ACCOUNTANT MEMBER AND MS MADHUMITA ROY , JUDICIAL MEMBER ./ ITA NO. 2436/AHD/2015 / ASSTT. YEAR: 2011 - 2012 GOVINDBHAI G. BHARWAD , 1, VUSHWAS RESIDENCY , OPP. MALAV KUTIR , B/H HITARTH PARTY PLOT , SOLA, AHMEDABAD . PAN : AHXPB9464H VS. D.C.I.T. , CIRCLE - 6 , AHMEDABAD. (APPLICANT) ( RESPON D ENT ) ASSESSEE BY : SHRI S.N. DIVETIA , A.R REVENUE BY : SHRI R.R. MAKWANA , SR. .D. R / DATE OF HEARING : 04 / 01 / 2021 / DATE OF PRONOUNCEMENT: 02 / 03 /2021 / O R D E R PER WASEEM AHMED, ACCOUNTANT MEMBER: THE CAPTIONED APPEAL HAS BEEN FILED AT THE INSTANCE OF THE ASSESSEE A GAINST THE ORDER OF THE LEARNED COMM ISSIONER OF INCOME TAX (APPEALS) - 3 , AHMEDABAD , DATED 26 /05 /2015 ARISING IN THE MATTER OF ASSESSM ENT ORDER PASSED UNDER S.143(3) OF THE INCOME TAX ACT 1961 ( HERE - IN - AFTER REFERRED TO AS 'THE ACT') RELEVANT TO THE ASSESSMENT YEAR 2011 - 20 12 . ITA NO.2436/AHD/2015 ASSTT. YEAR 2011 - 12 2 2. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL: ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE COMMISSIONER OF INCOME - TAX(APPEALS), WHERE AN APPEAL IS FILED BEFORE THE TRIBUNAL AGAINST THE ORDER OF COMMISSIONER OF INCOME TAX(APPEALS), WHERE AN APPEALS IS FILED BEFORE THE TRIBUNAL AGA INST THE ORDER OF COMMISSIONER OF INCOME TAX(APPEALS) ERRED IN TOTAL ADDITION OF RS.829142/ - AS PER THE GROUND STATED BELOW: 1. THE LEANED CIT(A) HAS ERRED IN LAW IN CONFIRMING THE ADDITION OF RS.107142/ - MADE IN RESPECT OF THE SALE CONSIDERATION OF THE LAND U/S.50C OF THE INCOME TAX ACT. 2. THE LEARNED CIT (A) HAS ERRED IN LAW IN CONFIRMING THE ADDITION OF RS.572000/ - MADE IN RESPECT OF UNEXPLAINED CASH CREDIT U/S.68 OF THE INCOME TAX ACT. 3. THE LEARNED CIT(A) HAS ERRED IN LAW IN CONFIRMING THE ADDITION OF RS.1 50000/ - OUT OF RS.300000/ - MADE IN RESPECT OF LOW WITHDRAWAL OF HOUSEHOLD EXPENSES. 4. THE APPELLANT CRAVES LEAVE TO ADD, AMEND, ALTER, DELETE, CHANGE OR MODIFY ANY OR ALL GROUNDS BEFORE OR AT THE TIME OF THE HEARING. 3. FIRST ISSUE RAISED BY THE ASSESSEE I S THAT THE LEARNED CIT (A) ERRED IN CONFIRMING THE ADDITION FOR RS. 1,07,142/ - UNDER SECTION 50C OF THE ACT. 4. THE FACTS OF THE CASE ON HAND ARE THAT THE ASSESSEE, DURING THE YEAR UNDER CONSIDERATION , SOLD A PIECE OF LAND BEARING SURVEY NUMBER 299/1 & 299/2 FOR RS. 2,75,00,000/ - JOINTLY . HOWEVER , THE STAMP VALUE OF THE IMPUGNED LAND WAS OF RS. 2,77,14,285/ - ONLY WHICH WAS MORE THAN THE SALES VALUE . THEREFORE THE AO INVOKED THE PROVISION OF SECTION 50C OF THE ACT AND WORKED OUT THE DIFFERENCE IN CONSIDER ATION DECLARED VIZ - A - VIZ STAMPED VALUE AT RS. 2,14,285 / - ONLY WHICH WAS TREATED AS THE INCOME OF THE ASSESSEE . THE AO ACCORDINGLY MADE THE ADDITION OF RS. 1,07,142/ - BEING THE 50% SHARE BELONGING TO THE ASSESSEE TO THE TOTAL INCOME OF THE ASSESSEE . 4.1 T HE ASSESSEE CARRIED THE MATTER TO THE APPELLATE AUTHORITY I.E. LEARNED CIT (A). ITA NO.2436/AHD/2015 ASSTT. YEAR 2011 - 12 3 4.2 THE ASSESSEE BEFORE THE LEARNED CIT(A) SUBMITTED TH AT AT THE TIME OF AGREEMENT TO SALE THE J A NTARI VALUE OF THE LAND WAS AT RS. 2,43,93,600/ - @ RS. 8800/ - PER SQ MTR. W HICH IS MUCH LOWER THAN THE ACTUAL CONSIDERATION. 5. HOWEVER THE LEARNED CIT (A) CONFIRMED THE ADDITION MADE BY THE AO BY OBSERVING AS UNDER: SECTION 50C PROVIDES THAT IF THE VALUE STATED IN THE INSTRUMENT OF TRANSFER IS LESS THAN THE VALUATION ADOPTED , ASSESSED OR ASSESSABLE BY THE STAMP DUTY AUTHORITIES, THE VALUATION AS ADOPTED , ASSESSED OR ASSESSABLE BY THE STAMP DUTY AUTHORITIES WILL BE CONSIDERED FOR THE PURPOSE OF COMPUTATION OF CAPITAL GAINS ARISING ON TRANSFER OF LAND OR BUILDING OR BOTH. IN VI EW OF THE SAME AND THE FACTS OF THE CASE, THE PROVISIONS OF SECTION 50C HAVE BEEN CORRECTLY APPLIED BY THE AO SINCE AS PER THE STAMP DUTY PAID THE SALE CONSIDERATION WAS MORE THAN THAT TAKEN BY THE APPELLANT. THE ADDITION OF RS.1,07,142/ - IS THEREFORE CONF IRMED. THE GROUND OF APPEAL NO.4 IS DISMISSED. 6. BEING AGGRIEVED BY THE ORDER OF THE LEARNED CIT (A), THE ASSESSEE IS IN APPEAL BEFORE US 7. THE LEARNED AR BEFORE US FILED PAPER BOOK RUNNING FROM PAGES 1 TO 65 AND CONTENDED THAT THE DIFFERENCE BETWEEN THE STAMP VALUE AND SALES CONSIDER ATION OF LAND IS OF 0.78% ONLY WHICH IS LESS THAN 5%. THEREFORE, THE ACTUAL SALE CONSIDERATION DECLARED BY THE ASSESSEE SHOULD BE TAKEN FOR THE PURPOSE OF COMPUTING THE INCOME UNDER THE HEAD CAPITAL GAIN. 8. ON THE OTHER HAND LEARNED DR VEHEMENTLY SUPPORTED THE ORDER OF AUTHORITIES BELOW. 9. WE HAVE HEARD THE RIVAL CONTENTION S OF BOTH THE PARTIES AND PERUSED THE MATERIAL S AVAILABLE ON RECORD. FOR THE SAKE OF BREVITY WE ARE GOING INTO DETAILED FACTS OF THE CA SE FOR THE REASON THAT THE SAME HAS BEEN DISCUSSED IN PREVIOUS PARAGRAPH. 9.1 T HE FIRST ISSUE FOR OUR ADJUDICATION IS WHETHER THE RELAXATION PROVIDED VIDE 3 RD PROVISO TO SECTION 50C OF THE ACT WHICH COMES INTO FORCE VIDE FINANCE ACT 2018 ITA NO.2436/AHD/2015 ASSTT. YEAR 2011 - 12 4 W.E.F. 01 - 04 - 20 19 CAN BE GIVEN A RETROSPECTIVE EFFECT. BEFORE ADJUDICATING THE ISSUE IT IS PERTINENT TO TAKE NOTE OF THE PROVISION OF SECTION 50C OF THE ACT AS APPLICABLE TO THE YEAR UNDER CONSIDERATION AS WELL AS AMENDMENT BROUGHT IN BY THE F INANCE ACT 2018. THE PROVISI ON BEFORE AMENDMENT AS APPLICABLE TO THE RELEVANT ASSESSMENT YEAR UNDER CONSIDERATION READS AS UNDER: 50C. (1) WHERE THE CONSIDERATION RECEIVED OR ACCRUING AS A RESULT OF THE TRANSFER BY AN ASSESSEE OF A CAPITAL ASSET, BEING LAND OR BUILDING OR BOTH, IS L ESS THAN THE VALUE ADOPTED OR ASSESSED 91 [OR ASSESSABLE] BY ANY AUTHORITY OF A STATE GOVERNMENT (HEREAFTER IN THIS SECTION REFERRED TO AS THE 'STAMP VALUATION AUTHORITY') FOR THE PURPOSE OF PAYME NT OF STAMP DUTY IN RESPECT OF SUCH TRANSFER, THE VALUE SO ADOPTED OR ASSESSED 91 [OR ASSESSABLE] SHALL, FOR THE PURPOSES OF SECTION 48 , BE DEEMED TO BE THE FULL VALUE OF THE CONSIDERATION RECEIVED OR ACCRUING AS A RESULT OF SUCH TRANSFER. 9.2 THE ABOVE PROVISION CREATE S A DEEMING FICTION THAT IN CASE WHERE CONSIDERATION ON SALE OR TRANSFER OF PROPERTY BEING LAND OR BUILDING FALLS BELOW THE VALUE ON WHICH STAMP DUTY IS PAID TO S TAT E G OVERNMENT UNDER RELEVANT ACT THEN SUCH VALUE SHOULD BE TAKEN AS CONSIDERATION FOR PURPOSE OF COMPUTING CAPITAL GAIN ON SUCH TRANSFER. 9.3 HOWEVER THIS DEEMING FICTION WAS CREATING HARDSHIP TO THE ASSESSEE WHERE THERE WERE MARGINAL VARIATION BETWEEN STAMP VALUE AND ACTUAL CONSIDERATION DUE TO GENUINE REASON. THEREFORE THE LEGISLATOR INSERTED NEW PROVISO TO SECTION 50C(1) OF THE ACT WHICH PROVIDED EXEMPTION FROM THE LEVY OF THIS SECTION WHEN DIFFERENCE BETWEEN ACTUAL CONSIDERATION AND STAMP VALUE IS LESS THAN 5%. THE PROVISO AND MEMORANDUM EXPLAINING THE PROVISION READS AS UNDER: PROVIDED ALSO THAT WHERE THE VALUE ADOPTED OR ASSESSED OR ASSESSABLE BY THE STAMP VALUATION AUTHORITY DOES NOT EXCEED ONE HUNDRED AND FIVE PER CENT OF THE CONSIDERATION RECEIVED OR ACCRUING AS A RESULT OF THE TRANSFER, THE CONSIDERATION SO RECEIVED OR ACCRUING AS A RES ULT OF THE TRANSFER SHALL, FOR THE PURPOSES OF SECTION 48 , BE DEEMED TO BE THE FULL VALUE OF THE CONSIDERATION. MEMORANDUM AT PRESENT, WHILE TAXING INCOME FROM CAPITAL GAINS (SECTION 50C), BUSINESS PROFITS (SECTION 43CA) AND OTHER SOURCES (SECTION 56) ARISING OUT OF TRANSACTIONS IN IMMOVABLE PROPERTY, THE SALE CONSIDERATION OR STAMP DUTY VALUE, WHICHEVER IS HIGHER IS ADOPTED. THE DIFFERENCE IS TAXED AS INCOME BOTH IN THE HANDS OF THE PURCHASER AND THE SELLER. IT HAS BEEN POINTED OUT THAT THIS VARIATION CAN OCCUR IN RESPECT OF SIMILAR PROPERTIES IN THE SAME AREA BECAUSE OF A VARIETY OF FACTORS, INCLUDING SHAPE OF THE PLOT OR LOC ATION. IN ORDER TO MINIMIZE HARDSHIP IN CASE OF GENUINE TRANSACTIONS IN THE REAL ESTATE SECTOR, IT IS PROPOSED TO PROVIDE THAT NO ADJUSTMENTS SHALL BE MADE IN A CASE WHERE THE VARIATION BETWEEN STAMP DUTY VALUE AND THE SALE CONSIDERATION IS NOT MORE THAN F IVE PERCENT OF THE SALE CONSIDERATION. THESE ITA NO.2436/AHD/2015 ASSTT. YEAR 2011 - 12 5 AMENDMENTS WILL TAKE EFFECT FROM 1ST APRIL, 2019 AND WILL, ACCORDINGLY, APPLY IN RELATION TO THE ASSESSMENT YEAR 2019 - 20 AND SUBSEQUENT ASSESSMENT YEARS. 9.4 FROM THE PERUSAL OF ABOVE PROVISO AND MEMORANDUM EXP LAINING IT , IT BECOMES CLEAR THAT THE ABOVE AMENDMENT OR PROVISO WAS INSERTED BY THE LEGISLATURE WITH VIEW TO MINIMIZE THE HARDSHIP CAUSED TO ASSESSEE DUE TO DEEMING FICTION. THEREFORE IN OUR CONSIDERED WHENEVER AN AMENDMENT BROUGHT IN STATUTE BY THE LEGIS LATURE WITH VIEW TO ERASE THE HARDSHIP CAUSED TO THE ASSESSEE THEN SUCH AMENDMENT SHOULD BE GIVEN A RETROSPECTIVE EFFECT WITHOUT GOING INTO THE FACT WHETHER THE SAME IS WRITTEN SPECIFICALLY OR NOT. IN HOLDING SO WE FIND SUPPORT AND GUIDANCE FROM THE JUDGM ENT OF COORDINATE BENCH OF THIS ITAT IN ITA NO - 1237/AHD/2013 OF DHARAMSHIBHAI SONANI VS. ACIT REPORTED IN 161 ITD 627 W HERE THE ISSUE WAS THAT WHETHER THE AMENDMENT BROUGHT IN SECTION 50C OF THE ACT WITH REGARD TO THE POINT OF TIME FOR TAKING STAMP VALUE VIDE FINANCE ACT 2016 IS RETROSPECTIVE IN NATURE OR NOT. THE COORDINATE BENCH HELD AS UNDER: SO FAR AS SECTION 50C IS CONCERNED, THE FINANCE ACT, 2016, WITH EFFECT FROM 1 - 4 - 2017, INSERTED THE PROVISOS TO SECTION 50C. [PARA 5] THERE CANNOT BE ANY DISPUTE THAT THIS AMENDMENT IN THE SCHEME OF SECTION 50C HAS BEEN MADE TO REMOVE AN INCONGRUITY, RESULTING IN UNDUE HARDSHIP TO THE ASSESSEE. ONCE IT IS NOT IN DISPUTE THAT A STATUTORY AMENDMENT IS BEING MADE TO REMOVE AN UND UE HARDSHIP TO THE ASSESSEE OR TO REMOVE AN APPARENT INCONGRUITY, SUCH AN AMENDMENT HAS TO BE TREATED AS EFFECTIVE FROM THE DATE ON WHICH THE LAW, CONTAINING SUCH AN UNDUE HARDSHIP OR INCONGRUITY, WAS INTRODUCED. [PARA 7] THE PRESENT AMENDMENT, BEING AN A MENDMENT TO REMOVE AN APPARENT INCONGRUITY WHICH RESULTED IN UNDUE HARDSHIPS TO THE TAXPAYERS, SHOULD BE TREATED AS RETROSPECTIVE IN EFFECT. QUITE CLEARLY THEREFORE, EVEN WHEN THE STATUTE DOES NOT SPECIFICALLY STATE SO, SUCH AMENDMENTS, CAN ONLY BE TREATED AS RETROSPECTIVE AND EFFECTIVE FROM THE DATE RELATED STATUTORY PROVISIONS WAS INTRODUCED. VIEWED THUS, THE PROVISO TO SECTION 50C SHOULD ALSO BE TREATED AS CURATIVE IN NATURE AND WITH RETROSPECTIVE EFFECT FROM 1 - 4 - 2003, I.E. THE DATE EFFECTIVE FROM WHICH SECTION 50C WAS INTRODUCED. [PARA 8] 9.5 WE ALSO FIND SUPPORT AND GUIDANCE FROM THE JUDGMENT OF HON BLE AGRA ITAT RAJIV KUMAR AGARWAL V. ACIT [IT APPEAL NO. 337 (AGRA) OF 2013] WHICH WAS FOLLOWED BY THE HON BLE DELHI HIGH COURT IN CASE OF CIT VS. ANSAL LAND MARK TOWNSHIP ( P) LTD. REPORTED IN 377 ITR 635 W HERE THE HON BLE BENCH OF ITAT AGRA HELD AS UNDER: ITA NO.2436/AHD/2015 ASSTT. YEAR 2011 - 12 6 'ON A CONCEPTUAL NOTE, PRIMARY JUSTIFICATION FOR SUCH A DISALLOWANCE IS THAT SUCH A DENIAL OF DEDUCTION IS TO COMPENSATE FOR THE LOSS OF REVENUE BY CO RRESPONDING INCOME NOT BEING TAKEN INTO ACCOUNT IN COMPUTATION OF TAXABLE INCOME IN THE HANDS OF THE RECIPIENTS OF THE PAYMENTS. SUCH A POLICY MOTIVATED DEDUCTION RESTRICTIONS SHOULD, THEREFORE, NOT COME INTO PLAY WHEN AN ASSESSEE IS ABLE TO ESTABLISH THAT THERE IS NO ACTUAL LOSS OF REVENUE. THIS DISALLOWANCE DOES DEINCENTIVIZE NOT DEDUCTING TAX AT SOURCE WHEN SUCH TAX DEDUCTIONS ARE DUE, BUT, SO FAR AS THE LEGAL FRAMEWORK IS CONCERNED, THIS PROVISION IS NOT FOR THE PURPOSE OF PENALIZING FOR THE TAX DEDUCTI ON AT SOURCE LAPSES. THERE ARE SEPARATE PENAL PROVISIONS TO THAT EFFECT. DEINCENTIVIZING A LAPSE AND PUNISHING A LAPSE ARE TWO DIFFERENT THINGS AND HAVE DISTINCTLY DIFFERENT, AND SOMETIMES MUTUALLY EXCLUSIVE, CONNOTATIONS. WHEN WE APPRECIATE THE OBJECT OF SCHEME OF SECTION 40(A)(IA), AS ON THE STATUTE, AND TO EXAMINE WHETHER OR NOT, ON A 'FAIR, JUST AND EQUITABLE' INTERPRETATION OF LAW AS IS THE GUIDANCE FROM HON'BLE DELHI HIGH COURT ON INTERPRETATION OF THIS LEGAL PROVISION, IN OUR HUMBLE UNDERSTANDING, I T COULD NOT BE AN 'INTENDED CONSEQUENCE' TO DISALLOW THE EXPENDITURE, DUE TO NON - DEDUCTION OF TAX AT SOURCE, EVEN IN A SITUATION IN WHICH CORRESPONDING INCOME IS BROUGHT TO TAX IN THE HANDS OF THE RECIPIENT. THE SCHEME OF SECTION 40(A)(IA), AS WE SEE IT, I S AIMED AT ENSURING THAT AN EXPENDITURE SHOULD NOT BE ALLOWED AS DEDUCTION IN THE HANDS OF AN ASSESSEE IN A SITUATION IN WHICH INCOME EMBEDDED IN SUCH EXPENDITURE HAS REMAINED UNTAXED DUE TO TAX WITHHOLDING LAPSES BY THE ASSESSEE. IT IS NOT, IN OUR CONSIDE RED VIEW, A PENALTY FOR TAX WITHHOLDING LAPSE BUT IT IS A SORT OF COMPENSATORY DEDUCTION RESTRICTION FOR AN INCOME GOING UNTAXED DUE TO TAX WITHHOLDING LAPSE. THE PENALTY FOR TAX WITHHOLDING LAPSE PER SE IS SEPARATELY PROVIDED FOR IN SECTION 271C, AND, SEC TION 40(A)(IA) DOES NOT ADD TO THE SAME. THE PROVISIONS OF SECTION 40(A)(IA), AS THEY EXISTED PRIOR TO INSERTION OF SECOND PROVISO THERETO, WENT MUCH BEYOND THE OBVIOUS INTENTIONS OF THE LAWMAKERS AND CREATED UNDUE HARDSHIPS EVEN IN CASES IN WHICH THE ASSE SSEE'S TAX WITHHOLDING LAPSES DID NOT RESULT IN ANY LOSS TO THE EXCHEQUER. NOW THAT THE LEGISLATURE HAS BEEN COMPASSIONATE ENOUGH TO CURE THESE SHORTCOMINGS OF PROVISION, AND THUS OBVIATE THE UNINTENDED HARDSHIPS, SUCH AN AMENDMENT IN LAW, IN VIEW OF THE W ELL SETTLED LEGAL POSITION TO THE EFFECT THAT A CURATIVE AMENDMENT TO AVOID UNINTENDED CONSEQUENCES IS TO BE TREATED AS RETROSPECTIVE IN NATURE EVEN THOUGH IT MAY NOT STATE SO SPECIFICALLY, THE INSERTION OF SECOND PROVISO MUST BE GIVEN RETROSPECTIVE EFFECT FROM THE POINT OF TIME WHEN THE RELATED LEGAL PROVISION WAS INTRODUCED. IN VIEW OF THESE DISCUSSIONS, AS ALSO FOR THE DETAILED REASONS SET OUT EARLIER, WE CANNOT SUBSCRIBE TO THE VIEW THAT IT COULD HAVE BEEN AN 'INTENDED CONSEQUENCE' TO PUNISH THE ASSESSE ES FOR NON - DEDUCTION OF TAX AT SOURCE BY DECLINING THE DEDUCTION IN RESPECT OF RELATED PAYMENTS, EVEN WHEN THE CORRESPONDING INCOME IS DULY BROUGHT TO TAX. THAT WILL BE GOING MUCH BEYOND THE OBVIOUS INTENTION OF THE SECTION. ACCORDINGLY, WE HOLD THAT THE I NSERTION OF SECOND PROVISO TO SECTION 40(A)(IA) IS DECLARATORY AND CURATIVE IN NATURE AND IT HAS RETROSPECTIVE EFFECT FROM 1ST APRIL, 2005, BEING THE DATE FROM WHICH SUB CLAUSE (IA) OF SECTION 40(A) WAS INSERTED BY THE FINANCE (NO. 2) ACT, 2004.' 9.6 NOW COMING TO CASE OF THE ASSESSEE, THE LEARNED AR FOR THE ASSESSEE BEFORE US CONTENDED THAT THE VARIATION BETWEEN THE SALES CONSIDERATION AND STAMP VALUE WAS ONLY OF 0.78% WHICH IS WITH IN THE LIMIT OF RELAXATION PROVIDED VIDE 3 RD PROVISO TO SECTION 50C OF THE ACT THOUGH INSERTED BY FINANCE ACT 2018. THIS CONTENTION OF THE ASSESSEE NOT IN DISP UTE. THUS CONSIDERING THE ABOVE DISCUSSION , WE HOLD THAT THE AMENDMENT BROUGHT IN SECTION 50C BY FINANCE ACT 201 8 IS IN RETROSPECTIVE IN NATURE. ACCORDINGLY, THE VARIA TION IN THE AMOUNT OF CONSIDERATION SHOWN BY THE ASSESSEE IS WITH IN PERMISSIBLE LIMIT OF THE STAMP VALUE CONSIDERATION . THEREFORE , NO ITA NO.2436/AHD/2015 ASSTT. YEAR 2011 - 12 7 ADDITION IS REQUIRED FOR THE AMOUNT SHOWING THE DIFFERENCE BETWEEN THE ACTUAL CONSIDERATION AND STAMP VALUE. ACCORDINGLY W E DIRECT THE AO TO DELETE THE ADDITION BY HIM . HENCE THE GROUND OF APPEAL OF THE ASSESSEE IS ALLOWED 10. THE N EXT ISSUED RAISED BY THE ASSESSEE IS THAT THE LEARNED CIT (A) ERRED IN CONFIRMING THE ADDITION FOR RS. 5,72,000/ - UNDER SECTION 68 OF THE ACT. 11. THE ASSESSEE DURING THE YEAR UNDER CONSIDERATION HAS DEPOSITED CASH IN HIS BANK NAMELY ICICI AND SBI BANK AMOUNT ING TO RS. 72,000/ - AND RS. 7,13,750/ - RESPECTIVELY. BUT THE ASSESSEE FAILED TO EXPLAIN THE SOURCES OF SUCH CASH DEPOSIT S. HOWEVER , T HE AO FOUND THAT THE ASSESSEE HAS SHOWN AGR ICULTURE AND COMMISSION INCOME OF RS. 2,34,000/ - AND RS 15,000/ - IN CASH RESPECTIVELY . SIMILARLY THE ASSESSEE CLAIMED TO HA VE INCURRED CASH EXPENSES OF RS. 25,000/ - ON ACCOUNT OF STAMP DUTY AND RS. 36,000/ - ON ACC OUNT OF HOUSEHOLD EXPENSES. ACCORDINGLY THE AO WORKED OUT THE UNEXPLAINED CASH DEPOSIT S TO THE TUNE OF RS. 5,72,000/ - AND ADDED THE SAME TO TOTAL INCOME OF THE ASSESSEE. 12. THE ASSESSEE PREFERRED AN APPEAL BEFORE LEARNED CIT (A). 12.1 THE ASSESSEE BEFORE THE LD. CIT - A, REGARD ING THE DEPOSIT OF CASH IN ICICI BANK FOR RS. 72,000/ - SUBMITTED THAT DURING THE YEAR HE HAS SOLD ONE OF HIS OLD CAR ON WHICH EMI WAS PENDING WITH THE UNDERSTANDING WITH THE BUYER THAT T HE PURCHASER SHALL PAY THE PENDING EMIS . H OWEVER , THE CAR LOAN WAS IN HIS NAME (THE ASSESSEE) THEREFORE THE PURCHASER OF CAR USED TO DEPOSIT CASH FOR RS. 9000/ - EVERY MOTH IN HIS (THE ASSESSEE) BANK ACCOUNT. 12.2 LIKEWISE, REGARD THE CASH DEPOSIT OF RS. 7,13,750/ - IN SBI BANK , T HE ASSESSEE SUBMI TTED THAT THE CASH FOR RS. 3,18,750/ - WAS DEPOSITED OUT OF RECEIPT AGAINST SALE OF PROPERTY BEARING SURVEY NO - 687 WHICH WAS DULY DISCLOSED IN RETURN OF INCOME. THE ASSESSEE ALSO SUBMITTED THAT DURING THE YEAR HE HAS WITHDRAW N CASH ON VARIOUS OCCASION. THU S THE HOUSEHOLD EXPENSES OF RS. 36,000/ - WAS M ET OUT FROM SUCH ITA NO.2436/AHD/2015 ASSTT. YEAR 2011 - 12 8 WITHDRAWAL. THE ASSESSEE FURTHER SUBMITTED THAT AN AMOUNT OF RS. 3,75,000/ - WAS WITHDRAWN FROM SBI BANK DATED 16/06/2010 WHICH WAS USED FOR THE PAYMENT OF PURCHASE CONSIDERATION OF RS. 3,50,000 / - AND STAMP DUTY OF RS. 15,000/ - ALONG WITH OTHER EXPENSES AGAINST PURCHASE OF LAND. 12.3 THE ASSESSEE FURTHER CLAIMED THAT THE ABOVE FACTS CAN BE SUBSTANTIATE D FROM THE BANK STATEMENT, BOOKS OF ACCOUNT S AND SALE AND PURCHASE AGREEMENT OF PROPERTY WHICH WERE FILED BEFORE THE AO DURING THE ASSESSMENT PROCEEDING S. 13. HOWEVER THE LEARNED CIT (A) CONFIRMED THE ADDITION MADE BY THE AO BY OBSERVING AS UNDER: I HAVE CAREFULLY CONSIDERED THE FACTS OF THE CASE IN THE LIGHT OF THE SUBMISSIONS MADE BY THE APPEL LANT AND THE FINDING OF THE ASSESSING OFFICER RECORDED IN THE ASSESSMENT ORDER. DURING APPELLATE PROCEEDINGS, THE APPELLANT SUBMITTED THAT HE HAD TAKEN A LOAN FOR PURCHASE OF A MARUTI SWIFT CAR WHICH WAS SUBSEQUENTLY SOLD BY HIM WHILE THE LOAN WAS STILL OU TSTANDING. IT WAS FURTHER SUBM ITTED THAT THE AMOUNT OF RS. 72,000/ - CREDITED TO HIS BANK ACCOUNT, WAS ON ACCOUNT OF REPAYMENT OF THIS LOAN BY THE PURCHASER OF THE CAR IN INSTALMENTS OF RS. 9,000/ - P.M, THESE CLAIMS HOWEVER HAVE NOT BEEN SUPPORTED BY ANY DOCUMENTARY EVIDENCE DURING APPELLATE PROCEEDINGS. NO DETAILS IN RESPECT OF THE LOAN, ARRANGEMENT WITH THE PURCHASER OF THE CAR, DETAILS OF SALE OF CAR ETC HAVE BEEN FURNISHED. IN RESPECT OF ALL THE OTHER CREDI T ENTRIES AS WELL, NO SUPPORTING DOCUMENTARY EVIDENCE HAS BEEN PRODUCED. THE APPELLANT HAS MERELY SUBMITTED A PRINT OUT OF HIS CASH BOOK TO SHOW THE VARIOUS ENTRIES. THE SAME DOES NOT CONFIRM ANY OF THE EXPLANATIONS GIVEN BY THE APPELLANT IN RESPECT OF THE CASH DEPOSITS MADE IN HIS BANK ACCOUNT. PERUSAL OF THE ASSESSMENT ORDER SHOWS THAT EVEN DURING ASSESSMENT PROCEEDINGS NO DETAILS HAD BEEN FURNISHED BEFORE THE A O . SINCE BEFORE ME AS WELL NO DETAILS HAVE BEEN FURNISHED, THE ADDITION OF RS. 5,72,000/ - IS CONFIRMED THE GROUND OF APPEAL NO. 5 IS DISMISSED. 14. BEING AGGRIEVED BY THE ORDER OF THE LEARNED CIT(A) THE ASSESSEE IS IN APPEAL BEFORE US. 15. THE LEARNED AR BE FORE US SUBMITTED THAT THE CASH OF 72,000 WAS RECEIVED FROM THE PARTY AGAINST THE PAYMEN T OF THE EMI AND THE SAME WAS DISCLOSED IN THE CASH BOOK. THE LEARNED AR ALSO CONTENDED THAT THE REMAINING AMOUNT OF CASH WAS DEPOSITED IN THE BANK OUT OF THE CASH WITHDRAWAL FROM THE BANK. 16. O N THE OTHER HAND THE LEARNED DR VEHEMENTLY SUPPORTED THE ORDER OF THE AUTHORITIES BELOW. ITA NO.2436/AHD/2015 ASSTT. YEAR 2011 - 12 9 17. WE HAVE HEARD THE RIVAL CONTENTIONS OF BOTH THE PARTIES AND PERUSED THE MATERIALS AVAILABLE ON RECORD. IT WAS EXPLAINED BY THE ASSESSEE THAT HE HAS RECEIVED A SUM OF 72,000, FROM THE PARTY TO W HOM HE HAS SOLD HIS CAR AGAINST THE PAYMENT OF THE EMIS . ORIGINALLY THE ASSESSEE ACQUIRED CAR ON THE LOAN WHICH WAS SOLD TO THE PARTY BUT THE OWNERSHIP WAS NOT TRANSFERRED. IN OTHER WORDS THE LOAN WAS CONTINUING IN THE NAME OF THE ASSESSEE ONLY. THUS THE OTHER PARTY WAS PAYING THE AMI TO THE ASSESSEE WHICH WAS SUBSEQUENTLY PAID TO THE BANK. IN THIS REGARD, CONVERSELY, WE FIND THAT CONTENTION OF THE ASSESSEE WAS NOT BASED ON ANY DOCUMENTARY EVIDENCE. THUS IN THE ABSENCE OF NECESSARY DOCUMENTS, WE DO NOT FIN D ANY MERIT SUBMISSION OF THE ASSESSEE. ACCORDINGLY WE CONFIRMED THE ADDITION FOR THE SUM OF 72,000 TO THE TOTAL INCOME OF THE ASSESSEE. 17.1 REGARDING THE BALANCE AMOUNT, IT WAS EXPLAINED BY THE ASSESSEE THAT MONEY WAS DEPOSITED OUT OF THE CASH WITHDRA WAL FROM THE BANK. THE ASSESSEE TO THIS EFFECT HAS FILED THE CASH BOOK WHICH IS PLACED ON PAGE S 27 - 28 OF THE PAPER BOOK. WE FIND FORCE IN THE ARGUMENT OF THE LEARNED AR FOR THE ASSESSEE. IF THE AMOUNT HAS BEEN DEPOSITED IN CASH BY THE ASSESSEE OUT OF THE C ASH WITHDRAWAL FROM THE BANK, THEN NO ADDITION, TO OUR MIND IS WARRANTED PARTICULARLY IN A SITUATION WHERE THERE IS NO FINDING OF THE AUTHORITIES BELOW SUGGESTING THAT THE AMOUNT WITHDRAWN FROM THE BANK WAS UTILIZ ED BY THE ASSESSEE FOR ANY OTHER PURPOSE. I N THE ABSENCE OF SUCH FINDING, AN INFERENCE CAN BE DRAWN THAT THE AMOUNT WITHDRAWN BY THE ASSESSEE FROM THE BANK WAS UTILI Z ED FOR THE PURPOSE OF SUBSEQUENT DEPOSIT IN THE BANK . HOWEVER, WE ARE INCLINED TO DIRECT THE AO TO VERIFY WHETHER THE WITHDRAWAL FROM THE BANK WAS DEPOSITED IN THE BANK SUBSEQUENTLY . IF THAT BE SO T HE ADDITION IS NOT WARRANTED. HENCE , THE GROUND OF APPEAL OF THE ASSESSEE IS ALLOWED. 18. THE LAST ISSUE RAISED BY THE ASSESSEE IS THAT THE LEARNED CIT (A) ERRED IN CONFIRMING THE PARTIAL ADDITION FOR RS. 1,50,000/ - ON ACCOUNT OF LOW WITHDRAWAL OF HOUSEHOLD EXPENSES. ITA NO.2436/AHD/2015 ASSTT. YEAR 2011 - 12 10 19. THE AO DURING THE ASSESSMENT PROCEEDING REQUIRED THE ASSESSEE TO FURNISH THE DETAIL OF FAMILY MEMBER S AND HOUSEHOLD EXPENSES. FROM THE DETAIL SUBMI TTED THE AO OBSERVED THAT THE ASSESSEE FAMILY COMPRISE OF 5 MEMBERS INCLUDING 3 SCHOOL GOING CHILDREN. THE AO FURTHER FOUND THAT ANNUAL SCHOOL FEE OF ONE CHILDREN COMES AT R S . 10 , 350/ - ONLY, AGGREGATING TO RS. 31,050.00 FOR ALL THE CHILDREN . HOWEVER THE AS SESSEE CLAIMED ANNUAL HOUSEHOLD EXPENSES AT RS. 36,000/ - ONLY. ACCORDINGLY THE AO CONSIDERING THE FAMILY AND LOCALITY OF THE ASSESSEE S RESIDENCE ESTIMATED THE ANNUAL HOUSEHOLD EXPENSES AT RS. 3,60,000/ - AND MADE A LUMP SUM ADDITION OF RS. 3,00,000 TO THE TOTAL INCOME OF THE ASSESSEE. 20. ON APPEAL THE LEARNED CIT (A) PROVIDED PARTIAL RELIE F TO THE ASSESSEE BY OBSERVING AS UNDER: I HAVE CAREFULLY CONSIDERED THE FACTS OF THE CASE IN THE LIGHT OF THE SUBMISSIONS MADE BY THE APPELLANT AND THE FINDING OF THE ASSESSING OFFICER RECORDED IN THE ASSESSMENT ORDER. I AM INCLINED TO AGREE WITH THE A O THAT THE AMOUNT OF RS. 36,000/ - A YEAR AS HOUSEHOLD EXPENSES | WHICH WORKS OUT TO RS. 3,000/ - P M IN VERY LOW SINCE THE APPELLANT HAS FIVE FAMILY MEMBERS AND ' ALSO MAI NTAINS A CAR. ALL HIS CHILDREN ARE SCHOOL GOING AND IT IS SEEN FROM THE ASSESSMENT ORDER THAT ANNUAL FEE OF ON E OF THE CHILDREN IS RS. 10,350/ - . DURING APPELLATE PROCEEDINGS, HOWEVER, THE APPELLANT SUBMITTED THAT HIS WIFE WAS ALSO AN EARNING MEMBER AND WAS FILING HER RETURN OF INCOME. IT WAS SUBMITTED THAT SHE ALSO CONTRIBUTED TO THE HOUSEHOLD EXPENSES OF THE FAMILY. HOWEVER NO DETAILS OF WITHDRAWALS MADE BY HER HAVE BEEN PRODUCED. NONETHELESS, CONSIDERING THAT THE APPELLANT'S WIFE MIGHT ALSO BE CONTR IBUTING TOWARDS HOUSEHOLD EXPENSES, ! AM R ESTRICTING THE ADDITION ON THIS AC COUNT TO RS. 1,50,000/ - INSTEAD OF RS. - 3,00,000/ - . THE APPELLANT THUS GETS RELIEF OF RS. 1,50,0007 - . 21. BEING AGGRIEVED BY THE ORDER OF THE LEARNED CIT(A) THE ASSESSEE IS IN APPE AL BEFORE US. 22. THE LEARNED AR BEFORE US SUBMITTED THAT THE HOUSEHOLD EXPENSES WERE MET OUT OF THE INCOME OF THE ASSESSEE, HIS WIFE AND THE MOTHER. IN OTHER WORDS THE ASSESSEE CONTRIBUTED IN SUCH HOUSEHOLD EXPENSES TO THE TUNE OF 36,000.00 ONLY. 23. O N THE OT HER HAND THE LEARNED DR VEHEMENTLY SUPPORTED THE ORDER OF THE AUTHORITIES BELOW. ITA NO.2436/AHD/2015 ASSTT. YEAR 2011 - 12 11 24. W E HAVE HEARD THE RIVAL CONTENTIONS OF THE PARTIES AND PERUSED THE MATERIALS AVAILABLE ON RECORD. NORMALLY, THERE CANNOT BE ADDITION ON THE BASIS OF ESTIMATI ON. HOWEVER, THE FACTS OF THE CASE ON HAND ARE DIFFERENT INSOFAR THE EXPENSES INCURRED BY THE ASSESSEE TOWARDS THE CHILDREN EDUCATION FEE. THE AO HAS GIVEN VERY CLEAR - CUT FINDING THAT THE ASSESSEE HAS BEEN INCURRING CHILDREN EDUCATION FEE OF 10, 350.00 FOR EACH CHILD AGGREGATING TO 3 1 ,0 50 . 00. FURTHERMORE, IT HAS ALSO BEEN POINTED OUT THAT THE FAMILY OF THE ASSESSEE CONSIST OF 5 MEMBERS IN TOTALITY. THUS IN SUCH CIRCUMSTANCES THE DRAWINGS SHOWN BY THE ASSESSEE TO THE TUNE OF 36,000 DOES NOT APPEAR TO BE R EASONABLE. 24. 1 MOVING FURTHER, WE ALSO FIND THAT THE ASSESSEE HAS NOT PRODUCED ANY DOCUMENTARY EVIDENCE IN SUPPORT OF HIS CONTENTION THAT THERE WAS THE INCOME IN THE HANDS OF HIS WIFE AND MOTHER. ACCORDINGLY, IN THE ABSENCE OF THE NECESSARY DOCUMENTS, IT CAN BE INFERRED THAT THERE WAS NO INCOME IN THE HANDS OF HIS WIFE AND MOTHER AS CLAIMED BY THE ASSESSEE. ACCORDINGLY, IT SEEMS THAT THE DRAWINGS SHOWN BY THE ASSESSEE SHOULD CERTAIN LY BE MORE THAN THE SUM OF RS. 3 6,000 AS SHOWN BY THE ASSESSEE. 24.2 THE NEXT QUESTION ARISES HOW TO ESTIMATE THE DRAWINGS THE ASSESSEE. INDEED, THE RE IS NO STANDARD JACKET FORMULA TO WORK OUT THE DRAWINGS OF THE ASSESSEE BASED ON THE DOCUMENTARY EVIDENCE IN THE GIVEN FACTS AND CIRCUMSTANCES. THUS, WE ARE OF THE VIEW THAT SOME ELEMENT OF GUESSWORK IS REQUIRED TO WORK OUT DRAWINGS OF THE ASSESSEE. ACCORDINGLY, WE HOLD THAT THE DRAWINGS TO THE TUNE OF 15,000 PER MONTH FOR THE HOUSEHOLD EXPENSES ARE SUFFICIENT AND R EASONABLE IN THE LIGHT OF THE ABOVE STATED FACTS AND DISCUSSION. THUS, THE TOTAL DRAWINGS WORKS OUT AT 1 , 80,000 AND THE ASSESSEE HAS ALREADY SHOWN A SUM OF 36,000 TOWARDS THE DRAWINGS IN THE INCOME TAX RETURN. ACCORD INGLY, THE BALANCE AMOUNT OF 1, 44,000 IS ADDED TO THE ITA NO.2436/AHD/2015 ASSTT. YEAR 2011 - 12 12 TOTAL INCOME OF THE ASSESSEE. HENCE THE GROUN D OF APPEAL OF THE ASSESSEE IS PARTLY ALLOWED. 25 . THE RESULT , THE APPEAL OF THE ASSESSEE IS PARTLY ALLOWED. O RDER PRONOUNCED IN THE COURT ON 02 /03 / 2021 AT AHMEDABAD. SD/ - SD/ - (MADHUMITA ROY ) (WASEEM AHMED) JUDICIAL MEMBER ACCOUNTANT MEMBER (TRUE COPY) A HMEDABAD; DATED 02 / 03 /2021 M ANISH