K.Karuppasamy, CHENNAI V. ITO, Tiruppur

ITA 2717/CHNY/2014

• Counselvise Citation: 271721714 RSA 2014
• Duration Of Justice: 1 year(s) 1 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-12-2015
• Appeal Filed By: Assessee
• Bench Allotted: A
• Next Hearing Date: 24-11-2015
• Assessment Year: 2009-2010
• Appeal Filed On: 31-10-2014
• Court: TRIBUNAL
• Department Lawyers: P RADHAKRISHNAN
• Assessee Lawyers: S SRIDHAR
• Keywords: Unexplained investment; Gift

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH : CHENNAI . . . , . ! , ' # $ [ BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER ] ./ I.T.A.NOS.2717 & 2718/MDS/2014 / ASSESSMENT YEARS : 2009-10 & 2010-11 SHRI K KARUPPASAMY 1/108B, MULLKARA THOTTAM KADAMBADI SULUR 641 402 VS. THE INCOME TAX OF FICER WARD I(6) TIRUPUR [PAN ALQPK 0451 Q ] ( %& / APPELLANT) ( '(%& /RESPONDENT) / APPELLANT BY : SHRI S SRIDHAR, ADVOCATE /RESPONDENT BY : SHRI P RADHAKRISHNAN, JCIT / DATE OF HEARING : 24 - 1 1 - 2015 ! / DATE OF PRONOUNCEMENT : - 1 2 - 2015 / O R D E R PER N.R.S.GANESAN, JUDICIAL MEMBER THESE APPEALS OF THE ASSESSEE ARE DIRECTED AGAIN ST SEPARATE ORDERS OF THE COMMISSIONER OF INCOME-TAX (APPEALS)-II, COIMBATORE, DATED 26.9.2014 FOR ASSESSMENT YEARS 2 009-10 AND 2010-11. I.T.A.NO.2717/MDS/2014 2. IN THIS APPEAL FOR ASSESSMENT YEAR 2009-10, THE ONL Y ISSUE ARISES FOR CONSIDERATION IS ADDITION OF ` 48,05,715/-. ITA NOS.2717 & 2718/14 :- 2 -: 3. SHRI S SRIDHAR, LD. COUNSEL FOR THE ASSESSEE SUBMIT TED THAT THERE WAS A SURVEY IN THE PREMISES OF M/S KODIES PR OMOTERS ON 6.9.2011. ACCORDING TO THE LD. COUNSEL, THE ASSESS EE ALONGWITH M/S JEYA KUMARAVEL AND SHANMUGASUNDARAM PROMOTED A COLO NY BY NAME AISHWARYAM COLONY. THE ASSESSEE CLAIMED BEFORE THE ASSESSING OFFICER THAT HE PAID A SUM OF ` 65 LAKHS TO THE LAND OWNERS OF AISHWARYAM COLONY. THE ASSESSEE EXPLAINED THAT HE RECEIVED A SUM OF ` 50 LAKHS FROM HIS WIFE. THE SOURCE FOR GIFT OF ` 50 LAKHS FOR HIS WIFE IS SALE PROCEEDS OF 3.18 ACRES OF LAND AT KAD UVETTIPALAYAM, ANNUR ON 2.7.2008. THE ASSESSEES WIFE HAS ALSO FILE D AN AFFIDAVIT. THE SALE OF THE LAND WAS ACCEPTED BY THE ASSESSING OFFI CER. AS PER AGREEMENT, THE SHARE OF THE ASSESSEES WIFE COMES TO ONLY ` 1.63 CRORES. REFERRING TO PAGE 47 OF THE PAPER BOOK, TH E LD. COUNSEL SUBMITTED THAT THIS IS AN AGREEMENT ENTERED INTO BE TWEEN THE PARTIES FOR SALE OF THE PROPERTY ON THE AGREED SALE CONSIDE RATION OF ` 51,25,0000/- PER ACRE. EVEN THOUGH THE AGREEMENT W AS FOR ` 51,25,000/- PER ACRE, ACCORDING TO THE LD. COUNSEL, THE SALE DEED WAS EXECUTED ONLY ON THE GUIDELINE VALUE. THEREFORE, T HE ASSESSING OFFICER HAS TAKEN THE SALE CONSIDERATION DISCLOSED IN THE S ALE DEED FOR SOURCE OF MAKING GIFT TO THE ASSESSEE BY HIS WIFE. ACCO RDING TO THE LD. COUNSEL, THE ASSESSING OFFICER WANTED TO TAKE THE S ALE CONSIDERATION DISCLOSED IN THE SALE DEED, THEN WHILE CONSIDERING THE INVESTMENT IN ITA NOS.2717 & 2718/14 :- 3 -: THE LANDED PROPERTY, HE HAS TO CONFINE HIMSELF ONLY TO THE SALE CONSIDERATION DISCLOSED IN THE SALE DEED. THE ASS ESSING OFFICER ON THE ONE HAND IS ADOPTING THE SALE CONSIDERATION DISCLOS ED IN THE SALE DEED EXECUTED BY ASSESSEES WIFE FOR SALE OF THE LAND A ND IGNORED THE VALUE DISCLOSED IN THE AGREEMENT FOR SALE AND ON THE OTHE R HAND WHILE THE ASSESSEE PURCHASED THE LAND, HE IS ADOPTING/ACCEPT ING PAYMENT OF ON MONEY OVER AND ABOVE THE SALE CONSIDERATION DISCLOS ED IN THE SALE DEED. ACCORDING TO THE LD. COUNSEL, WHAT WAS RECEI VED BY THE ASSESSEES WIFE IS ` 51,25,000/- PER ACRE AND HER SHARE OF MONEY COMES TO NEARLY ` 1.63 CRORES. THIS MONEY WAS INVESTED BY THE ASSESSEE IN THE PROPERTY PURCHASED BY THE ASSESSE E. THEREFORE, THE ASSESSING OFFICER IS NOT JUSTIFIED IN RESTRICTING T HE SALE CONSIDERATION OF THE LAND TO ` 3,88,570/- AND MAKING ADDITION OF ` 48,05,715/-. 4. ON THE CONTRARY, SHRI P RADHAKRISHNAN, LD. DEPARTME NTAL REPRESENTATIVE SUBMITTED THAT THE SIGNATURE OF SMT K. THULASIMANI IN THE AGREEMENT A COPY OF WHICH IS AVAILABLE AT PAGE 47 OF THE PAPER BOOK DIFFERS FROM THE SIGNATURE FOUND IN THE REGIST ERED SALE DEED. BY FILING A COPY OF THE REGISTERED SALE DEED, THE LD. DR SUBMITTED THAT THIS IS A COPY RECEIVED BY THE ASSESSING OFFICER FROM TH E SRO OFFICE AND THE SIGNATURE OF SMT K THULASIMANI DOES NOT TALLY WITH SIGNATURE FOUND IN THE AGREEMENT. THEREFORE, THE AGREEMENT DATED 5.4. 2008 THE COPY OF WHICH IS AVAILABLE AT PAGE 47 OF THE PAPER BOOK CAN NOT BE ACTED UPON. ITA NOS.2717 & 2718/14 :- 4 -: IF THE AGREEMENT CANNOT BE ACTED UPON THEN WHAT WAS TO BE ACTED IS REGISTERED SALE DEED WHICH DISCLOSES THE SALE CONSI DERATION OF ` 3,88,570/-. THE ASSESSEES WIFE IS ENTITLED FOR 5 0% OF THE SALE CONSIDERATION WHICH COMES TO ` 1,94,285/-. THEREFORE, THE ASSESSEE COULD NOT EXPLAIN THE INVESTMENT OF ` 48,05,715/- HENCE, THE ASSESSING OFFICER HAS RIGHTLY MADE ADDITION OF ` 48,05,715/- AS UNEXPLAINED INVESTMENT IN THE JOINT VENTURE PROJECT. ON A QUER Y FROM THE BENCH WHEN THE SALE CONSIDERATION WAS TAKEN AS ` 3,88,570/- IN THE CASE OF SALE OF LAND BY ASSESSEES WIFE, HOW IT WAS TREATE D IN THE HANDS OF THE PURCHASER, THE LD. DR HAS FILED A COPY OF THE LETTE R DATED 29.7.2015 SAID TO BE RECEIVED FROM THE ASSESSING OFFICER THAT THE CONCERNED ASSESSING OFFICER WAS NOT INFORMED AND NO PROCEEDIN GS WERE INITIATED TO FIND OUT THE ACTUAL SALE CONSIDERATION FROM THE PURCHASER. THE LD. DR FURTHER CLARIFIED THAT THE COPY OF THE SALE DEED WAS NOT PRODUCED BY THE ASSESSEE BEFORE THE ASSESSING OFFICER , THEREF ORE, THE CLAIM OF THE ASSESSEE COULD NOT BE ACCEPTED. 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EITHER SIDE AND ALSO PERUSED THE MATERIAL AVAILABLE ON RECORD. TH E ASSESSEE, ADMITTEDLY, INVESTED A SUM OF ` 65 LAKHS IN THE JOINT VENTURE PROJECT AISHWARYAM COLONY. THE ASSESSEE EXPLAINED BEFOR E THE ASSESSING OFFICER THAT HE RECEIVED A SUM OF ` 50 LAKHS AS GIFT FROM HIS WIFE. THE ASSESSEES WIFE IN FACT SOLD 3.18 ACRES OF LAND AT KADUVETTIPALAYAM ON ITA NOS.2717 & 2718/14 :- 5 -: 2.7.2008. OUT OF THE SALE PROCEEDS, THE ASSESSEE S WIFE CLAIMED THAT SHE GIFTED A SUM OF ` 50 LAKHS. THE ASSESSEES WIFE HAS ALSO FILED AN AFFIDAVIT TO THAT EFFECT. THE ASSESSING OFFICER, H OWEVER, FOUND THAT THE GUIDELINE VALUE OF THE PROPERTY AS ON THE DATE OF S ALE DEED COMES TO ` 3,88,570/-, THEREFORE, THE ASSESSEES WIFES SHARE COMES TO ` 1,94,285/-. ACCORDINGLY, THE BALANCE AMOUNT OF ` 48,05,715/- WAS TREATED AS UNDISCLOSED INVESTMENT BY THE ASSESSING OFFICER. THE FACT REMAINS THAT THERE IS AN AGREEMENT BY THE ASSESSEE S WIFE AND ONE MS. K TAMILSELVI FOR SALE OF THE LAND TO ONE SHRI N JAGADEESH. THE SALE CONSIDERATION DISCLOSED IN THE AGREEMENT IS ` 51,25,000/- PER ACRE. 6. THE MAIN OBJECTION OF THE LD. DR IS THAT THE SIGNA TURE OF ASSESSEES WIFE SMT. THULASIMANI IN THIS AGREEMENT DOES NOT TALLY WITH THE SIGNATURE IN THE REGISTERED SALE DEED. HOWEVER , HE IS NOT DISPUTING ABOUT THE GENUINENESS OF THE SIGNATURE OF OTHER PAR TIES WHO ARE PARTIES TO THE AGREEMENT NAMELY, MS. TAMILSELVI, SH RI N JAGADEESH AND SHRI N DHAMODRASAMY. IF THE SIGNATURES OF MS. TAMIL SELVI, SHRI N JAGADEESH AND SHRI N DHAMODRASAMY ARE GENUINE AND I T IS NOT DISPUTED BY THE REVENUE, THIS TRIBUNAL DO NOT FIND ANY REASON TO DOUBT THE GENUINENESS OF THE SIGNATURE OF SMT. THULASIMAN I ALONE IN THE VERY SAME AGREEMENT. MOREOVER, EITHER THE ASSESSING OFF ICER OR THIS TRIBUNAL IS NOT COMPETENT ENOUGH TO DECIDE THE GEN UINENESS OF THE SIGNATURE. THE ASSESSING OFFICER, IN FACT, HAS NOT DISPUTED THE ITA NOS.2717 & 2718/14 :- 6 -: GENUINENESS OF THE SIGNATURE FOUND IN THE AGREEMENT . THE ONLY CONTENTION OF THE ASSESSING OFFICER IS THAT THE COP Y OF THE SALE DEED WAS NOT FILED BEFORE HIM. THEREFORE, AT THIS STAGE , THE LD. DR CANNOT CONTEND THAT THE SIGNATURE OF SMT. THULASIMANI DOES NOT TALLY WITH SIGNATURE FOUND IN THE SALE DEED. IF THE LD. DR DI SPUTES ALL THE SIGNATURES FOUND IN THE AGREEMENT DATED 5.4.2008, T HEN THIS TRIBUNAL WOULD HAVE REMANDED THE MATTER BACK TO THE FILE OF THE ASSESSING OFFICER WITH DIRECTION TO REFER THE MATTER TO THE H ANDWRITING EXPERT TO FIND OUT THE GENUINENESS OF THE SIGNATURES. SINCE THE LD. DR IS NOT DISPUTING THE SIGNATURE IN RESPECT OF FOUR OTHER PE RSONS OUT OF FIVE AND HE IS DISPUTING ONLY ONE SIGNATURE, THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT REMANDING THE MATTER BACK TO THE ASSES SING OFFICER TO REFER THE MATTER TO THE HANDWRITING EXPERT MAY NOT SERVE ANY PURPOSE. SINCE THERE WAS AGREEMENT FOR SALE BETWEEN THE PART IES WHICH DISCLOSES SALE CONSIDERATION OF ` 51,25,000/- PER ACRE OF LAND AND THE PARTIES TO THE AGREEMENT FILED AN AFFIDAVIT BEFORE THE ASSESSING OFFICER THAT THEY SOLD THE LAND FOR THE SALE CONSIDERATION AS DISCLOSED IN THE SALE AGREEMENT, THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT THE ASSESSING OFFICER SHOULD NOT HAVE DOUBTED THE SALE CONSIDERATION SAID TO BE RECEIVED BY THE ASSESSEES WIFE. FURTHERMOR E, THE ASSESSING OFFICER HAS NOT INITIATED ANY ACTION AGAINST THE PU RCHASER OF THE LAND IN ORDER TO ASCERTAIN THE REAL CONSIDERATION. IN THO SE CIRCUMSTANCES, THIS ITA NOS.2717 & 2718/14 :- 7 -: TRIBUNAL IS UNABLE TO UPHOLD THE ORDERS OF THE LOWE R AUTHORITIES. THEREFORE, THE ADDITION MADE BY THE ASSESSING OFFIC ER TO THE EXTENT OF ` 48,05,715/- CANNOT BE SUSTAINED. ACCORDINGLY, TH E ORDERS OF THE LOWER AUTHORITIES ARE SET ASIDE AND THE ASSESSING O FFICER IS DIRECTED TO DELETE THE ADDITION OF ` 48,05,715/-. 7. IN THE RESULT, THE APPEAL OF THE ASSESSEE FOR ASS ESSMENT YEAR 2009-10 STANDS ALLOWED. I.T.A.NO.2718/MDS/2014 8. IN ASSESSMENT YEAR 2010-11, THE ISSUE IS WITH REGAR D TO ADDITION MADE BY THE ASSESSING OFFICER TOWARDS UNEX PLAINED INVESTMENT MADE BY THE ASSESSEE TO THE EXTENT OF ` 83 LAKHS. 9. AS ALREADY DISCUSSED FOR THE ASSESSMENT YEAR 2009- 10, THE ASSESSEES WIFE RECEIVED A SUM OF ` 1.63 CRORES ON SALE OF LAND AS PER THE AGREEMENT DATED 5.4.2008. OUT OF THIS, SHE GIF TED A SUM OF ` 83 LAKHS TO THE ASSESSEE. THE ASSESSING OFFICER MADE ADDITION ONLY ON THE GROUND THAT THE ASSESSEES WIFE COULD NOT HAVE SOLD HER PROPERTY FOR ` 1.63 CRORES SINCE THE GUIDELINE VALUE WAS ` 3,88,570/-. WHILE DISCUSSING THE ASSESSEES APPEAL FOR ASSESSMENT YE AR 2009-10, THIS TRIBUNAL FOUND THAT THE AGREEMENT FOR SALE CLEARLY ESTABLISHES SALE OF LAND AT ` 51,25,000/- PER ACRE, THEREFORE, THE SHARE OF THE ASSESSEES ITA NOS.2717 & 2718/14 :- 8 -: WIFE COMES TO ` 1.63 CRORES AND OUT OF THIS, THE ASSESSEES WIFE GIFTED A SUM OF ` 83 LAKHS WHICH WAS, IN TURN, INVESTED IN THE PURCH ASE OF PROPERTY BY THE ASSESSEE. THEREFORE, THE ADDITION MADE BY THE ASSESSING OFFICER TO THE EXTENT OF ` 83 LAKHS CANNOT BE SUSTAINED. ACCORDINGLY, THE ORDERS OF THE LOWER AUTHORITIES AR E SET ASIDE AND THE ADDITION MADE BY THE ASSESSING OFFICER TO THE EXTEN T OF ` 83 LAKHS IS DELETED. 10. IN THE RESULT, THE APPEAL OF THE ASSESSEE FOR ASSE SSMENT YEAR 2010-11 STANDS ALLOWED. 11. TO SUMMARIZE THE RESULT, BOTH THE APPEALS OF THE A SSESSEE STAND ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 18 TH DECEMBER, 2015, AT CHENNAI. SD/- SD/- ( . ! ) (A. MOHAN ALANKAMONY) ' / ACCOUNTANT MEMBER ( . . . ' ) (N.R.S. GANESAN) / JUDICIAL MEMBER #$ / CHENNAI %& / DATED: 18 TH DECEMBER, 2015 RD &' ()*) / COPY TO: 1 . / APPELLANT 4. + / CIT 2. / RESPONDENT 5. ),- . / DR 3. +/' / CIT(A) 6. -01 / GF