Smt. Usha Rani W/0. Sh. Kamal Kishore, Amritsar. V. The Income Tax Officer (Tech), Amritsar.

ITA 286/ASR/2014

• Counselvise Citation: [2015] 121 COUNSELVISE.COM (IT) 1411 (ITAT-AMRITSAR)
• Duration Of Justice: 1 year(s) 4 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-09-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 15-09-2015
• Assessment Year: 2002-2003
• Appeal Filed On: 05-05-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: SUBASH MAHAJAN
• Keywords: Unexplained investment

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH; (SMC), AMRITSAR BEFORE SH. A.D.JAIN, HONBLE JUDICIAL MEMBER I.T.A. NO.285 (ASR)/2014 ASSESSMENT YEAR: 2002-03 PAN: AAXPK1892K SH. ARVIND KUMAR, S/O SH. KAMAL KISHORE, 291/11, GALI LAMBANWALI, CHAURASTI ATTARI, AMRITSAR. VS. THE INCOME TAX OFFICER, WARD-2(1) AMRITSAR (APPELLANT) (RESPONDENT) I.T.A. NO.286 (ASR)/2014 ASSESSMENT YEAR: 2002-03 PAN: AEBPR4056E SMT. USHA RANI, W/O SH. KAMAL KISHORE 292/11, GALI LAMBANWALI, CHAURSTI ATTARI, AMRITSAR. VS. THE INCOME TAX OFFICER (TECH) O/O THE COMMISSIONER OF INCOME TAX-1, AMRITSAR. (APPELLANT) (RESPONDENT) I.T.A. NO.287 (ASR)/2014 ASSESSMENT YEAR: 2002-03 PAN: AIUPK4454A SH. RAMAN KUMAR S/O SH. KAMAL KISHORE, 291/11, GALI LAMBANWALI, CHAURSTI ATTARI, AMRITSAR. VS. THE INCOME TAX OFFICER (TECH) O/O THE COMMISSIONER OF INCOME TAX-1, AMRITSAR. (APPELLANT) (RESPONDENT) APPELLANT BY: SH. SUBASH MAHAJAN (ADV.) RESPONDENT BY: SH. TARSEM LAL (DR) DATE OF HEARING: 1 5.09.2015 DATE OF PRONOUNCEM ENT: 18.09.2015 ORDER PER A.D. JAIN (JM): THESE ARE THREE APPEALS FILED BY THREE DIFFERENT ASSESSEES, AGAINST THE ORDER DATED 18.02.2014, PASSED BY THE LEARNED CIT(A ), AMRITSAR. COMMON . ITA NO. 285,286 & 287 (ASR)/2014 ASSESSMENT YEAR 2002-03 2 ISSUES BEING INVOLVED IN ALL THESE APPEALS, THEY AR E BEING DISPOSED OF BY THIS COMMON ORDER. THE CASE OF SH. ARVIND KUMAR IN ITA N O.285 (ASR)/2014 BEING THE LEAD CASE, THE FACTS ARE BEING TAKEN THEREFROM, FOR CONVENIENCE. 2. THE FOLLOWING GROUNDS HAVE BEEN RAISED BY THE AS SESSEES. (I) THAT THE LEARNED COMMISSIONER OF INCOME TAX (A PPEALS) HAS ERRED IN SUSTAINING ADDITION OF RS.4,77,498/- MADE BY THE INCOME TAX OF FICER. HIS THIS ILLEGAL AND UNJUSTIFIED. (II) THAT THE LEARNED COMMISSIONER OF INCOME TAX ( APPEALS) HAS ERRED IN UPHOLDING THE FINDING OF THE INCOME TAX OFFICER. HE HAS ERRED IN TAKING PURCHASE VALUE OF PLOT AT RS.8,89,164/- AS MENTIONED IN THE ALLEGED AGREEMENT TO SELL (PHOTO STAT COPY ONLY), AS AGAINST 4,11,666/- AS MENTIONED IN THE SALE DEED AN D SHOWN BY THE APPELLANT AND THUS HAS ERRED IN UPHOLDING THE ORDER OF THE INCOME TAX OFFICER MAKING ADDITION OF RS.4,77,498/- TO THE RETURNED INCOME OF THE APPELLA NT, TREATING IT AS UNEXPLAINED INVESTMENT MADE BY THE APPELLANT IN THE PURCHASE OF 1/3 RD SHARE OF PROPERTY MEASURING 82.33 SQ. YARDS IN CIRCLE NO. 110, PRIVATE NO.2, OU T OF PRIVATE PROPERTY NO. 4-B SITUATED AT DASAUNDA SINGH ROAD, AMRITSAR VIDE SALE DEED DAT ED 18/02/2002 FROM SH. SATISH KUMAR AND ASHWANI KUMAR. HIS THIS ACTION IS ILLEGAL , AGAINST THE FACTS OF THE CASE, NOT BASED ON ANY LEGAL MATERIAL ON RECORD, AND IS UNTEN ABLE IN LAW. (III) THAT THE LEARNED COMMISSIONER OF I NCOME TAX (APPEALS) HAS ERRED IN REJECTING THE CONTENTION OF THE APPELLANT THAT PHOTOSTAT COPY OF THE DOCUMENT IS INADMISSIBLE EVIDENCE UNDER THE LAW AND ADDITION MADE ON THE BAS IS OF PHOTOSTAT COPY IS NOT LEGAL AND SUSTAINABLE. THIS ACTION OF IGNORING THE CONTEN TION OF THE APPELLANT IS ILLEGAL AND UNJUSTIFIED. (IV) THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) HAS FURTHER ERRED IN IGNORING THE CONTENTION OF THE APPELLANT THAT THE ASSESSING OFFICER SHOULD HAVE CALLED THE SELLER OF THE PROPERTY TO VERIFY THE FACT OF SALE RATE MEN TIONED IN THE ALLEGED SALE AGREEMENT AND THE RATE AS WAS SETTLED BETWEEN THE SELLER AND THE PURCHASER (APPELLANT) AT THE TIME OF EXECUTION OF SALE DEED. THIS ACTION OF IGNORING THE CONTENTION OF THE APPELLANT BY THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) IS ILL EGAL AND UNJUSTIFIED. (V) THAT THE LEARNED COMMISSIONER OF IN COME TAX (APPEALS) HAS FURTHER ERRED IN IGNORING THE RATES MENTIONED IN THE SALE DEEDS EXEC UTED ALMOST AT THE SAME TIME, IN . ITA NO. 285,286 & 287 (ASR)/2014 ASSESSMENT YEAR 2002-03 3 RESPECT OF PART OF THE SAME PRIVATE NO, SAME CIRCLE NO. HIS THIS ACTION IS ILLEGAL AND UNJUSTIFIED. (VI) IT IS PRAYED THAT THE ORDER OF TH E LEARNED COMMISSIONER OF INCOME TAX (APPEALS) UPHOLDING THE ORDER OF THE INCOME TAX OFF ICER MAY BE QUASHED AND ADDITION OF RS.4,77,498/- MAY BE DELETED IN THE INTEREST OF JUS TICE. 3. THE FACTS AS PER THE RECORD ARE THAT EACH OF THE ASSESSEES HAD PURCHASED PROPERTY MEASURING 82.33 SQ. YARDS, CIRCLE NO.110, BEARING PRIVATE NO. BEING 1/3 RD SHARE OUT OF PROPERTY NO.4B, DASUNDA SINGH RAOD, A MRITSAR FOR RS.4,11,666/67P. THE ACTUAL SALE PRICE AGREED WITH THE SELLER OF THE PROPERTY NAMELY SH. ASHWANI KUMAR AND SH. SATISH KUMAR WAS @ RS.10,800/- PER SQ. YARD WHICH COMES TO RS.8,89,164/-, WHEREAS IN SALE DEED, THE ASSESSEE HAD SHOWN SALE PRICE OF RS. 5000/- PER SQUARE YARD (THE A.O WAS IN POSSESSION OF BOTH OF THE AGREEMENTS). AFTER GOING THROUGH THE CO PY OF SALE AGREEMENT AND THE SALE DEED, IT WAS CLEAR TO THE ASSESSING OFFICE R THAT THE ASSESSEE HAD MADE PAYMENT OF RS.4,77,498/- OUT OF SOURCES NOT DISCLOS ED IN THE INCOME TAX RETURN. ON 05.10.2009, SHRI ARVIND KUMAR, ASSESSEE AND SH. AMIT KHANNA, ADVOCATE ATTENDED THE PROCEEDINGS BEFORE THE ASSESS ING OFFICER. COPY OF AGREEMENT REGARDING PURCHASE OF PROPERTY MEASURING 82.33 SQ. YARDS AS ABOVE, AT AN AGREED RATE OF RS.10,800/- AND SALE DEED ACTU ALLY EXECUTED @ RS.5,000/- PER SQUARE YARD WAS SHOWN TO THE ASSESSEE AND HE AD MITTED THAT BOTH THE DOCUMENTS BELONGED TO HIM AND IN CONFIRMATION, HE H AD PUT HIS SIGNATURE ON THE ASSESSING OFFICERS ORDER SHEET, PAGE-I, BOTH IN HINDI AND ENGLISH IN THE PRESENCE OF HIS COUNSEL, SH. AMIT KHANNA. . ITA NO. 285,286 & 287 (ASR)/2014 ASSESSMENT YEAR 2002-03 4 4. THE ASSESSING OFFICER MADE THE ADDITION FOR THE REASON THAT THE ASSESSEE DID NOT OFFER ANY EXPLANATION. 5. BY VIRTUE OF THE IMPUGNED ORDER, THE LEARNED CI T(A) CONFIRMED THE ADDITION MADE BY THE ASSESSING OFFICER. 6. BEFORE ME, THE LEARNED COUNSEL FOR THE ASSESSEES HAS CONTENDED AS FOLLOWS. THAT THE LEARNED COMMISSIONER OF INCOME TA X (APPEALS) HAS ERRED IN UPHOLDING THE FINDING OF THE INCOME TAX OFFICER. HE HAS ERRED IN TAKING PURCHASE VALUE OF PLOT AT RS.8,89,164/- AS MENTIONE D IN THE ALLEGED AGREEMENT TO SELL (PHOTOSTAT COPY ONLY), AS AGAINST 4,11,666/ - AS MENTIONED IN THE SALE DEED AND SHOWN BY THE ASSESSEE AND THUS, HAS ERRED IN UPHOLDING THE ORDER OF THE INCOME TAX OFFICER MAKING ADDITION OF RS.4,77,4 98/- TO THE RETURNED INCOME OF THE ASSESSEE, TREATING IT AS UNEXPLAINED INVESTMENT MADE BY THE ASSESSEE IN THE PURCHASE OF 1/3 RD SHARE OF PROPERTY MEASURING 82.33 SQ. YARDS IN CIRCLE NO. 110, PRIVATE NO.2, OUT OF PRIVATE PRO PERTY NO. 4-B SITUATED AT DASAUNDA SINGH ROAD, AMRITSAR VIDE SALE DEED DATED 18/02/2002 FROM SH. SATISH KUMAR AND ASHWANI KUMAR. HIS THIS ACTION IS ILLEGAL, AGAINST THE FACTS OF THE CASE, NOT BASED ON ANY LEGAL MATERIAL ON REC ORD, AND IS UNTENABLE IN LAW. THAT THE LEARNED COMMISSIONER OF INCOME TAX (APPEAL S) HAS ERRED IN REJECTING THE CONTENTION OF THE ASSESSEES THAT PHOTOSTAT COPY OF THE DOCUMENT IS INADMISSIBLE EVIDENCE UNDER THE LAW AND ADDITION MA DE ON THE BASIS OF PHOTOSTAT COPY IS NOT LEGAL AND SUSTAINABLE. THIS A CTION OF IGNORING THE CONTENTION OF THE ASSESSEES IS ILLEGAL AND UNJUSTIF IED. THE LEARNED . ITA NO. 285,286 & 287 (ASR)/2014 ASSESSMENT YEAR 2002-03 5 COMMISSIONER OF INCOME TAX (APPEALS) HAS FURTHER ER RED IN IGNORING THE CONTENTION OF THE ASSESSEES THAT THE ASSESSING OFFI CER SHOULD HAVE CALLED THE SELLER OF THE PROPERTY TO VERIFY THE FACT OF SALE R ATE MENTIONED IN THE ALLEGED SALE AGREEMENT AND THE RATE AS WAS SETTLED BETWEEN THE S ELLER AND THE PURCHASERS (ASSESSEE) AT THE TIME OF EXECUTION OF SALE DEED. T HIS ACTION OF IGNORING THE CONTENTION OF THE APPELLANT BY THE LEARNED COMMISSI ONER OF INCOME TAX (APPEALS) IS ILLEGAL AND UNJUSTIFIED. 7. ON THE OTHER HAND, THE LEARNED DR HAS CONTENDED THAT THE LEARNED CIT(A) HAS RIGHTLY CONFIRMED THE ADDITIONS MADE BY THE ASS ESSING OFFICER, IN VIEW OF THE FACT THAT THE ASSESSEE ARVIND KUMAR HAD HIMSELF ADMITTED BEFORE THE ASSESSING OFFICER THAT BOTH THE DOCUMENTS, I.E., TH E AGREEMENT TO SELL AND THE SALE DEED BELONGED TO HIM. IT HAS BEEN SUBMITTED TH AT ONCE THIS WAS THE ADMITTED CASE OF THE ASSESSEES, NO FURTHER ENQUIRY WAS REQUIRED. 8. I HAVE HEARD THE RIVAL CONTENTIONS AND HAVE PERU SED THE MATERIAL ON RECORD. AS PER THE IMPUGNED ORDER, INFORMATION WAS RECEIVED BY THE ASSESSING OFFICER THAT THE ASSESSEES HAD PURCHASED THE PROPER TY IN QUESTION FROM ASHWANI KUMAR AND SATISH KUMAR. THE ASSESSING OFFIC ER OBSERVED IN PARA-1 OF THE ASSESSMENT ORDER THAT AFTER GOING THROUGH THE C OPY OF THE SALE AGREEMENT AND SALE DEED, IT WAS CLEAR THAT THE ASSESSEES HAD MADE PAYMENT OUT OF SOURCES NOT DISCLOSED IN THE INCOME TAX RETURNS. IT WAS ON THIS BASIS, THAT RE- ASSESSMENT PROCEEDINGS WERE INITIATED. THE ADDITION WAS MADE FOR THE REASON THAT THE ASSESSEES COULD NOT OFFER ANY EXPLANATION, THOUGH ARVIND KUMAR . ITA NO. 285,286 & 287 (ASR)/2014 ASSESSMENT YEAR 2002-03 6 ASSESSEE HAD ADMITTED BEFORE THE ASSESSING OFFICER THAT BOTH DOCUMENTS BELONGED TO HIM AND HE HAD CONFIRMED THIS IN WRITIN G. THE ADDITIONS WERE CONFIRMED BY THE LEARNED CIT(A). 9. IT REMAINS UNDISPUTED THAT THE AGREEMENT TO SELL RELIED ON BY THE AUTHORITIES BELOW WAS A PHOTO COPY AND NOT THE ORIG INAL THEREOF. IT IS ALSO UNDISPUTED THAT THIS SALE AGREEMENT WAS ADMITTED BY THE ASSESSEE ARVIND KUMAR. HOWEVER, I AM NOT IN AGREEMENT WITH THE DEPA RTMENT THAT SINCE ARVIND KUMAR ASSESSEE HAD MADE THE ADMISSION, THE A DDITIONS WERE TO FOLLOW INEXORABLY, AS A NATURAL CONSEQUENCE OF THE ADMISSI ON MADE BY ARVIND KUMAR. THE VERACITY OF DOCUMENTS SOUGHT TO BE RELIED ON MU ST BE ASCERTAINED BY THE AUTHORITY PLACING SUCH RELIANCE. IN THIS REGARD, I AM OF THE CONSIDERED OPINION THAT THE SELLERS OF THE PROPERTY OUGHT TO HAVE BEEN CALLED AND EXAMINED. THEY ARE THE BEST PEOPLE TO DEPOSE ON THE ISSUE IN QUEST ION. MOREOVER, IT IS NOT DISPUTED THAT THE ASSESSEES HAD PRODUCED ON RECORD SALE DEEDS PERTAINING TO SALES OF PLOT OF LAND, DURING THE SAME PERIOD, FROM THE SAME KHATA AND KHATAUNI, AS THAT OF THE LAND IN QUESTION. THIS IS AVAILABLE FROM PAGE 6, IN PARA 7 OF THE IMPUGNED ORDER, WHICH READS AS FOLLOWS: EVEN THE SELLER OF THE PROPERTY WAS NOT CALLED FOR TO VERIFY THE FACT OF SALE RATE MENTIONED IN THE SALE AGREEMENT. MOREOVER THE ADDITION HAS BEEN MADE IN HASTE, THE A PPELLANT WAS NOT GIVEN PROPER OPPORTUNITY TO PRODUCE EVIDENCE IN THE FORM OF OTHE R SALE DEEDS EXECUTED ALMOST AT THE SAME TIME AT THE PREVAILING CIRCLE RATES. I HEREBY FURNISHED COPIES OF SOME OF THE SALE DEEDS OF THE PLOTS FROM THE SAME KHATA & KHATAUNI W HICH SHOWN THAT THE SALES OF THE ADJOINING PLOTS HAVE BEEN MADE AT THE FOLLOWING RAT ES THE FOLLOWING RATES. @ RS.1,044/- PER SQ. YARD ON 22.03.1999 . ITA NO. 285,286 & 287 (ASR)/2014 ASSESSMENT YEAR 2002-03 7 @RS.1,334/- PER SQ. YARD ON 10.05.2000 & @ RS. 2,318/- PER SQ. YARD ON 31.08.2001. SIR, THE PRICES MENTIONED IN ALL THE ABOVE SALE DEE DS ARE MUCH BELOW RS.5,000/-, THE PRICE AT WHICH THE APPELLANT HAS PURCHASED PLOT MEASURING 82.33 SQ. YARDS ON 18.02.2002. 10. THE ABOVE SUBMISSIONS OF THE ASSESSEE HAVE B EEN TAKEN INTO CONSIDERATION BY THE LEARNED CIT(A), RENDERING THE IMPUGNED ORDER A RESULT OF COMPLETE NON-READING OF MATERIAL DOCUMENTARY EVIDEN CE BROUGHT ON RECORD BY THE ASSESSEES. THEREFORE, I DEEM IT APPROPRIATE TO REMIT ALL THE THREE APPEALS TO THE FILE OF THE ASSESSING OFFICER, TO EXAMINE THE S ALE OF THE PROPERTY IN QUESTION, AS ALSO TO TAKE INTO CONSIDERATION THE SALE INSTANC ES PRODUCED ON RECORD BY THE ASSESSEES. THE MATTER PERTAINING TO THE ADDITION MA DE WILL BE RE-DECIDED BY THE ASSESSING OFFICER IN THE LIGHT OF THE STATEMENTS OF THE SELLERS, TO BE RECORDED BY THE ASSESSING OFFICER AND CROSS EXAMINED BY THE ASS ESSEES AND THE SALE DEEDS PRODUCED BY THE ASSESSEE, ON VERIFICATION. THE ASSE SSEES SHALL BE OFFERED DUE AND ADEQUATE OPPORTUNITY OF HEARING AND THEY SHALL, NO DOUBT, CO-OPERATE WITH THE ASSESSING OFFICER IN THE REMAND PROCEEDINGS. O RDERED ACCORDINGLY. 10. IN THE RESULT, ALL THE THREE APPEALS FILED BY THE A SSESSEES ARE TREATED AS ALLOWED, FOR STATISTICAL PURPOSES. 11. ORDER PRONOUNCED IN THE OPEN COURT ON 18 TH SEPTEMBER, 2015. SD/- (A.D. JAIN) JUDICIAL ME MBER DATED:18.9. 2015 /PK/ PS. COPY OF THE ORDER FORWARDED TO: 1. THE ASSESSEE: SH. ARVIND KUMAR, CHAURASTI ATTARI, A MRITSAR. . ITA NO. 285,286 & 287 (ASR)/2014 ASSESSMENT YEAR 2002-03 8 2. THE INCOME TAX OFFICER, WARD 2(1), AMRITSAR. 3. THE CIT(A), 4. THE CIT, 5. THE SR DR, I.T.A.T., TRUE COPY BY ORDER (ASSISTANT REGISTRAR) INCOME TAX APPELLATE TRIBUNAL, AMRITSAR BENCH: AMRITSAR .