Shri Pradeep Sharma, Bhopal V. ITO-2(2), Bhopal

ITA 256/Ind/2019

• Counselvise Citation: [2020] 110 COUNSELVISE.COM (IT) 8459 (ITAT-INDORE)
• Duration Of Justice: 1 year(s) 3 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-07-2020
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: SMC
• Assessment Year: 2008-2009
• Appeal Filed On: 13-03-2019
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Assessee Lawyers: N D PATWA ADVS
• Section: 142(1); 48; 13; 147; 148; 144

Judgement Text

[ITA NO.256/IND/2019] [SHRI PRADEEP SHARMA ] 1 IN THE INCOME TAX APPELLATE TRIBUNAL INDORE SMC BENCH, INDORE BEFORE SHRI KUL BHARAT, JUDICIAL MEMBER ITA NO.256/IND/2019 ASSESSMENT YEAR: 2008-09 SHRI PRADEEP SHARMA, S/O. SHRI BADRI PRASAD SHARMA VILLAGE RATIBAD, BHOPAL / VS. ITO - 2 ( 2 ) BHOPAL ( APPELLANT ) ( REVENUE ) P.A. NO. BNUPS9341E APPELLANT BY SHRI ASHISH GOYAL & SHRI N.D. PATWA, ADVS RESPONDENT BY SHRI ASHISH PORWAL , DR DATE OF HEARING: 08.07.2020 DATE OF PRONOUNCEMENT: 09.07.2020 / O R D E R THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST ORDER O F THE COMMISSIONER OF INCOME TAX APPEALS [CIT(A)]-3, BHOPAL DATED 16.01.2019 PERTAINING TO THE ASSESSMENT YEAR 2008-09. THE ASSESSEE HAS RAISED FOLLOWING GROUND S OF APPEAL: ON THE FACTS AND THE CIRCUMSTANCES OF THE CASE:- 1. THE LD. CIT(A) WAS NOT JUSTIFIED IN SUSTAINING T HE ASSESSMENT ORDER U/S 144 R.W.S 147 WHICH IS BAD IN LAW, [ITA NO.256/IND/2019] [SHRI PRADEEP SHARMA ] 2 VOID-AB-INITIO, BARRED BY LIMITATION, ILLEGAL, CONT RARY TO THE FACTS AND CIRCUMSTANCES OF THE CASE, LIABLE TO BE ANNULLE D. 2. THAT THE LD. CIT(A) ERRED IN SUSTAINING THE ADDI TION OF RS.11,07,600/- ON ACCOUNT OF UNEXPLAINED CASH DEPOS IT IN THE BANK ACCOUNT WITHOUT ACCEPTING THE EXPLANATIONS OFF ERED BY THE ASSESSEE. 3. THAT THE LD. CIT(A) ERRED IN SUSTAINING THE ADDI TION OF RS.11,07,600/- AS UNEXPLAINED INCOME OF THE ASSESSE E, WITHOUT CONSIDERING THAT THE ASSESSEE HAS TAKEN LOA N FROM MR. MAHESH SHARMA AND FROM MR. LALIT SHARMA AND ALSO DISCHARGED THE ONUS BY PROVIDING AFFIDAVITS OF THE LENDERS. 2. THE FACTS GIVING RISE TO THE PRESENT APPEAL ARE THAT THE CASE OF THE ASSESSEE WAS REOPENED ON THE GROUND THAT TH E ASSESSEE HAD DEPOSITED CASH AMOUNTING TO RS.1107,600/- IN HIS SAVING BANK ACCOUNT. THE ASSESSING OFFICER DID NOT ACCEPT THE EXPLANATION AS GIVEN BY THE ASSESSEE AND PROCEEDED TO MAKE ADDITION OF RS.11,07,600/- AMOUNT DEPOSITED IN THE BANK ACCOUNT. 3. AGGRIEVED AGAINST THE ADDITION MADE IN ASSESSMENT OR DER DATED 21.03.2016, THE ASSESSEE PREFERRED AN APPEAL BEFORE LD. [ITA NO.256/IND/2019] [SHRI PRADEEP SHARMA ] 3 CIT(A), WHO ALSO DISMISSED THE APPEAL. NOW THE ASSESSE E IS IN APPEAL BEFORE THIS TRIBUNAL. 4. GROUND NO.1 IS AGAINST THE REOPENING OF THE ASSESSM ENT, LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE REVEN UE AUTHORITIES WERE NOT JUSTIFIED IN REOPENING THE ASSES SMENT. 5. LD. D.R. SUBMITTED THAT ADMITTEDLY, THE ASSESSEE H AD NOT FILED RETURN OF INCOME, THEREFORE, TO VERIFY TH E VERACITY OF DEPOSIT IN THE BANK ACCOUNT. THE ASSESSING OFFICER WAS JUSTIFIED IN REOPENING THE ASSESSMENT. 6. I HAVE HEARD THE RIVAL SUBMISSIONS, PERUSED THE MATERIALS AVAILABLE ON RECORD. I DO NOT SEE ANY INFIRMITY INTO THE ACTION OF THE ASSESSING OFFICER FOR REOPENING OF THE ASSESSMENT, ADMITTEDLY, THE ASSESSEE HAD NOT FILED ANY RETURN OF INCOME. HE HAD DEPOSITED IN THE SAVING ACCO UNT AMOUNTING TO RS.11,07,600/-. THE SOURCE OF SUCH DEPO SIT [ITA NO.256/IND/2019] [SHRI PRADEEP SHARMA ] 4 WAS REQUIRED TO BE VERIFIED. THUS, GROUND NO.1 OF THE ASSESSEES APPEAL IS REJECTED. 7. GROUND NO.2 & 3 ARE AGAINST THE SUSTAINING ADDITION O F RS.11,07.600/- FOR UNEXPLAINED CASH DEPOSIT. LD. COUN SEL FOR THE ASSESSEE REITERATED THE SUBMISSION AS MADE IN T HE WRITTEN SUBMISSION. FOR THE SAKE OF CLARITY WRITTEN SUBMISSION ARE REPRODUCED AS UNDER: SOURCE OF CASH DEPOSIT DEPOSIT RECEIVED FROM MATERNAL UNCLES FOR INVESTMEN T. THE ASSESSEE, AFTER RECEIPT OF THE MONEY HAD INVESTED T HE SAME IN SHARES. THE DETAILS OF THE DEPOSIT RECEIVED WERE AS UNDER: NAME AMOUNT SOURCE EVIDENCES MAHESH SHARMA(MAMA) OCCUPATION-FARMER 7,06,200 (A) MATURITY OF MONTHLY INCOME CERTIFICATE (MIC). (B) SALE OF RURAL AGRICULTURAL LAND (A) CONFIRMATION AND AFFIDAVIT OF MAHESH SHARMA (PAPER BOOK 13014) (B) BANK STATEMENT OF MAHESH (PB18) SHOWING CASH WITHDRAWAL RS.6,42,000 ON 14.01.2008 AND BANK STATEMENT OF ASSESSEE SHOWING [ITA NO.256/IND/2019] [SHRI PRADEEP SHARMA ] 5 CASH DEPOSIT (PAPER BOOK 19) RS.6,40,000 ON SAME DATE. (C) THREE DIFFERENT SALE DEEDS OF AGRICULTURAL LAND. PAPER BOOK.20- 44 LALIT SHARMA(MAMA) OCCUPATION-FARMER 4,01,400 SALE OF AGRICULTURAL LAND THREE DIFFERENT SALE DEED OF AGRICULTURAL LANDS. PAPER BOOK 20- 44 DETAILS OF AMOUNT RECEIVED ON SALE OF RURAL AGRICUL TURAL LAND BY MAMAJI WAS AS UNDER: LAND DATE OF REGISTRY AMOUNT PB REF. WHEN PAYMENT RECEIVED AS PER REGISTRY KHASRA NO.297/1 07.07.2008 POA TRANSFERRED AS PER SALE DEED - 06.08.2007 4,32,000 PB20-24 ALREADY RECEIVED EARLIER. PARA 3 OF THE SALE DEED KHASRA NO.298- 306/1- 307/1/1/4 ETC 07.07.2008 POA TRANSFERRED AS PER SALE DEED - 06.08.2007 (PAPER BOOK 32034) 4,32,000 PB25-34 ALREADY RECEIVED EARLIER. PARA 3 OF THE SALE DEED [ITA NO.256/IND/2019] [SHRI PRADEEP SHARMA ] 6 KHASRA NO.298- 306/1- 307/1/1 07.07.2008 POA TRANSFERRED AS PER SALE DEED - 06.08.2007 (PAPER BOOK 32034) 4,32,000 PB35-44 ALREADY RECEIVED EARLIER. PARA 3 OF THE SALE DEED COMMENTS OF THE LD. AO IN THE REMAND REPORT (PB7-9) BASIS OF LD. CIT(A) AND SUBMISSIONS OF THE APPELLANT : 1. REGISTRY FOR SALE OF LAND WAS DONE ON 07.07.2008, B UT THE CASH WAS DEPOSITED IN THE BANK OF ASSESSEE BETWEEN 13 NOV. 2007 TO 3 RD APRIL 2008. SUBMISSION: ASSESSEE SUBMITTED IN THE REJOINDER THAT THE AMOUNT WAS RECEIVED PRIOR TO REGISTRY. IN FACT THERE WAS MENTI ON OF THE POWER OF ATTORNEY IN THE SALE DEED. THE POWER OF AT TORNEY WAS DATED 6 TH AUGUST 2007. 2. NO PRUDENT AGRICULTURIST WILL SELL THE LAND AND ADV ANCE THE RECEIPT AS LOAN WITHOUT ANY REASON. SUBMISSION: THE FACT THAT THE DEPOSITORS (MAMAJI) SOLD THE LAND IS ON RECORD AND EVIDENCED BY REGISTRY. THE BASIS OF THE LD. CIT(A) IS A MERE SUSPICION AND SURMISE, AND NOTHING ELSE. 3. THE SOURCE OF THE DEPOSITS IS DULY EXPLAINED AS ABO VE IN THE CHART. [ITA NO.256/IND/2019] [SHRI PRADEEP SHARMA ] 7 SO FAR AS THE RECEIPT OF RS.6,40,000/- IS CONCERNED , IT IS CLEAR FROM THE BANK STATEMENT OF THE APPELLANT THAT THE AMOUNT WAS WITHDRAWN FROM THE BANK OF MAHESH SHARMA AND DEPOSITED IN THE BANK OF THE APPELLANT O N THE SAME DATE. SOURCE OF THE BALANCE RECEIPT WAS OUT OF THE SALE O F THREE RURAL AGRICULTURAL LANDS BY MAHESH SHARMA AND LALIT SHARMA. THIS FACT THEY HAD CONFIRMED IN THE AFFIDAVITS. LD. AO AND LD. CIT(A) CHOOSE NOT TO EXAMI NE THEM. 8. ON THE CONTRARY, LD. DR OPPOSED THIS SUBMISSION AN D SUPPORTED THE ORDERS OF THE AUTHORITIES BELOW. 9. I HAVE HEARD THE RIVAL SUBMISSIONS, PERUSED THE ORD ERS OF THE AUTHORITIES BELOW. THE SOLE GRIEVANCE OF THE ASSES SEE IS THAT THE AUTHORITIES BELOW REJECTED THE EXPLANATION IN A CASUAL MANNER, DESPITE THE FACT THAT THE ASSESSEE HAD GIVE N DOCUMENTARY EVIDENCES IN SUPPORT OF THE SOURCE OF CAS H DEPOSITS. I FIND THAT LD. CIT(A) CONFIRMED THE ADDITI ON BY OBSERVING AS UNDER: 4. GROUND NO.1:- THROUGH THIS GROUND OF APPEAL THE APPELLANT HAS CHALLENGED THE ADDITION OF RS.11,07,6 00/- ON ACCOUNT OF UNEXPLAINED CASH DEPOSIT IN BANK [ITA NO.256/IND/2019] [SHRI PRADEEP SHARMA ] 8 ACCOUNT. THE AO MADE ADDITION OF RS.11,07,600/- ON THE BASIS OF AIR INFORMATION RECEIPT. THE APPELLANT HAD DEPOSITED CASH AMOUNTING TO RS.11,07,600/- IN HIS SAVING BANK ACCOUNT. THE AO HAS ISSUED NOTICE U/S 1 48 DATED 27.03.2015 AFTER RECORDING THE REASONS, BUT T HE APPELLANT FAILED TO COMPLY. NOTICES U/S 142(1) WERE ISSUED ON 10.09.2015 & 12.10.2015. THE APPELLANT FAILED TO COMPLY THE ABOVE NOTICES. THEREAFTER, ON 26.11.2015 THE APPELLANT ATTENDED AND REQUESTED FOR M MORE TIME TO SUBMIT THE INFORMATION AND NEXT DATE O F HEARING WAS FIXED ON 29.12.2015. VIDE LETTER DATED 22.01.2016 THE APPELLANT SUBMITTED THAT HE HAS NOT FILED HIS INCOME TAX RETURN OF YEAR UNDER CONSIDERA TION, HIS INCOME WAS BELOW THE LIMIT. THEREAFTER, THE AO MADE THE ADDITION OF RS.11,07,600/- AND PASS THE ORDER U/S 144 OF THE INCOME TAX ACT. DURING THE APPELLATE PROCEEDINGS THE APPELLANT SUBMITTED THAT HE HAD TAKEN LOAN FROM MR. MAHESH SHARMA & MR. LALIT SHARMA. IN SUPPORT OF HIM CLAIM THE APPELLANT PRODU CED AFFIDAVITS OF MR. MAHESH SHARMA & MR. LALIT SHARMA. IN THESE AFFIDAVITS THEY CONFIRMED THAT THEY HAD GIVEN THE MONEY TO THE APPELLANT OUT OF AMOUNT RECEIVED FROM SALE OF RURAL AGRICULTURAL LAND AND SUBMITTED REGISTRY DOCUMENTS FOR SALE OF RURAL AGRICULTURAL LAND. THE APPELLANT MADE THE DEPOSIT IN THE BANK ACCOUNT FROM 13.11.2007 TO 02.04.2008. SHRI MAHESH SHARMA & SHRI LALIT SHARMA SOLD THE LAND ON 07.07.2008 I.E. AFTER THE CASE DEPOSIT THEREFORE, THE APPELLANT FAILED TO EST ABLISH THAT THE SUM DEPOSITED IN THE BANK ACCOUNT IS SALE PROCEED OF AGRICULTURAL LAND OF SHRI MAHESH SHARMA & SHRI LALIT SHARMA. THE APPELLANT ALSO FAILED TO STA TE THE REASON WHY SHRI MAHESH SHARMA & SHRI LALIT SHARMA SOLD THE AGRICULTURAL LAND. THE APPELLANT ALSO FAIL ED TO [ITA NO.256/IND/2019] [SHRI PRADEEP SHARMA ] 9 BRING ON RECORD THE NEED OF MONEY WHICH HE ALLEGEDL Y TAKEN FROM SHRI MAHESH SHARMA & SHRI LALIT SHARMA. NO PRUDENT AGRICULTURAL WILL SALE THE LAND AND ADVA NCE THE RECEIPT AS LOAN WITHOUT ANY REASON. THEREFORE, THE ADDITION MADE BY THE AO AMOUNTING TO RS.11,07,600/- IS CONFIRMED. THEREFORE, THE APPEAL ON THIS GROUND IS DISMISSED. 10. DURING THE COURSE OF HEARING LD. COUNSEL FOR TH E ASSESSEE HAS TAKEN ME THROUGH THE PAPER BOOK WHERE THE ASSESSEE HAS ENCLOSED CONFIRMATIONS OF GIVEN LOAN TO T HE ASSESSEE AND ALSO CONFIRMING THIS FACT BY WAY OF AFFIDAV ITS. THESE CONFIRMATION AND AFFIDAVIT FROM SHRI MAHESH SHARMA IS ENCLOSED AT PAPER BOOK PAGES 13-14 AND CONFIRMATIO N AND AFFIDAVIT FROM SHRI LALIT SHARMA IS ENCLOSED AT PAPER BOOK PAGES 15-16. LD. COUNSEL ALSO DREW OUT ATTENTION TO PAPER BOOK PAGES 17 TO 18 FOR BANK STATEMENTS OF SHRI MAHESH SHARMA WHICH IS ALSO ENCLOSED IN PAPER BOOK AS T O BUTTRESS THE CONTENTION THAT THE ASSESSEE HAD RECEIVED A SUM OF RS.7,06,200/- FROM SHRI MAHESH SHARMA OUT OF [ITA NO.256/IND/2019] [SHRI PRADEEP SHARMA ] 10 MATURITY OF MONTHLY INCOME CERTIFICATE (MIC) AND SALE O F RURAL AGRICULTURAL LAND. LD. COUNSEL STATED THAT THERE W AS CASH WITHDRAWAL OF RS.6,42,000/- FROM THE ACCOUNT OF T HE ASSESSEE. THEREFORE, THE SOURCE OF RS.6,40,000/- STO OD EXPLAINED. BOTH AUTHORITIES HAVE NOT ACCEPTED THIS CONTENTION AND IN MY VIEW WHEN THE ASSESSEE HAS LINKED CASH DEPOSIT, WITHDRAWAL, CASH RECEIVED FROM RELATIVES OF THE ASSESSEE AND THE RELATIVE HAS GIVEN AFFIDAVIT THAT S UCH AMOUNT WAS RECEIVED BY THE ASSESSEE FROM THE SAID RELAT IVE SHRI MAHESH SHARMA. REVENUE OUGHT TO HAVE BROUGHT SOME ADVERSE MATERIAL ON RECORD FOR REBUTTING SUCH CONTENTION. HOWEVER, NO SUCH MATERIAL IS PLACED ON RE CORD, THEREFORE, I DIRECT THE ASSESSING OFFICER TO DELETE THE ADDITION OF RS.6,40,000/-. REGARDING BALANCE AMOUNT OF RS.4,01,400/-, IT IS THE CONTENTION OF THE ASSESSEE THAT THE AMOUNT WAS RECEIVED FROM ANOTHER RELATIVE WHO HAD SOLD HIS LAND AND OUT OF THE ADVANCE RECEIPT, HE MADE PAYMENT [ITA NO.256/IND/2019] [SHRI PRADEEP SHARMA ] 11 TO THE ASSESSEE. I FIND THAT THE LD. CIT(A) OBSERVED THAT ASSESSEE MADE DEPOSIT IN BANK ACCOUNT FROM 13.11.2007 T O 02.04.2008. SHRI MAHESH SHARMA & SHRI LALIT SHARMA SOLD THE LAND ON 07.07.2008 I.E. AFTER THE CASE DEPOSIT THE REFORE, THE ASSESSEE FAILED TO ESTABLISH THAT THE SUM DEPOSITE D IN THE BANK ACCOUNT IS SALE PROCEED OF AGRICULTURAL LAND OF SHRI MAHESH SHARMA & SHRI LALIT SHARMA. THE ASSESSEE ALSO FAILED TO STATE THE REASON WHY SHRI MAHESH SHARMA & SHRI LALIT SHARMA SOLD THE AGRICULTURAL LAND. IT IS FURTH ER OBSERVED BY THE LD. CIT(A) THAT THE ASSESSEE FAILED TO BRING ON RECORD THE NEED OF MONEY WHICH HE ALLEGEDLY TAKEN FROM SHRI MAHESH SHARMA & SHRI LALIT SHARMA. NO PRUDENT AGRICULTURIST WILL SELL THE LAND AND ADVANCE THE RECEIPT AS LOAN WITHOUT ANY REASON. THIS OBSERVATION OF THE LD. C IT(A) IS CONTRARY TO THE RECORDS AS IT IS POINTED OUT BY TH E LD. COUNSEL FOR THE ASSESSEE THAT PART OF MONEY WAS OUT OF MATURITY OF FIX DEPOSITS. THE OTHER INTENTION OF THE ASSESSEE [ITA NO.256/IND/2019] [SHRI PRADEEP SHARMA ] 12 THAT AMOUNT WAS RECEIVED IN ADVANCE AS POWER OF ATTORNEY WAS EXECUTED ON 6 TH AUGUST 2007 AND FACTUM OF POWER OF ATTORNEY IS DULY REFLECTED IN THE REGISTERED SALE DE ED. HENCE, IN MY VIEW THE LD. CIT(A) OUGHT NOT TO HAVE J UST BRUSHED ASIDE THE EXPLANATION, ADMITTEDLY, ON THE BASIS OF SUSPICION, I, THEREFORE, DIRECT THE ASSESSING OFFIC ER TO DELETE THE BALANCE ADDITION OF RS.4,01,400/-. THUS, GROUNDS N O.2 & 3 OF THIS APPEAL ARE ALLOWED. 11. THE APPEAL FILED BY THE ASSESSEE IS PARTLY ALLOWED. ORDER WAS PRONOUNCED IN THE OPEN COURT ON 09 .07 .2020. SD/- (KU L BHARAT) JUDICIAL MEMBER INDORE; DATED : 09/07/2020 PATEL/PS COPY TO: ASSESSEE/AO/PR. CIT/ CIT (A)/ITAT (DR)/GUAR D FILE. BY ORDER ASSISTANT REGISTRAR, INDORE