I.T.O., Ward-2(2), Farrukhabad V. Smt. Rajeshwari Kapoor, Farrukhabad

ITA 292/AGR/2011

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 0413 (ITAT-AGRA)
• Duration Of Justice: 7 year(s) 9 month(s) 8 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 16-05-2019
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 22-05-2013
• Assessment Year: 2008-2009
• Appeal Filed On: 08-08-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: ASHOK MEHROTRA
• Keywords: Sale consideration of property below Jantri Value; Source of fund; Assessment record
• Section: 50C; 133(6)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AGRA BENCH, AGRA BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER AND SHRI A.L. GEHLOT, ACCOUNTANT MEMBER ITA NO.293/AGR/2011 ASSESSMENT YEAR: 2008-09 INCOME TAX OFFICER, VS. SMT. NALINI P. KAPOOR, WARD 2(2), FARRUKHABAD. W/O. SHRI PRADEEP KUMAR KAPOOR, C/O/ M/S. VISHWA NATH PRASAD MAHESH PRASAD, FARRUKHABAD. (PAN : ABRPK 3658 G). ITA NO.292/AGR/2011 ASSESSMENT YEAR: 2008-09 INCOME TAX OFFICER, VS. SMT. RAJESHWARI KAPOOR , WARD 2(2), FARRUKHABAD. 2/175, KHATRANA, FARRUKHABAD. (PAN : ABXPK 6447 M). (APPELLANTS) (RESPONDENTS) APPELLANTS BY : SHRI WASEEM ARSHAD, SR. D.R. RESPONDENTS BY : SHRI ASHOK MEHROTRA, ADVOCATE DATE OF HEARING : 22.05.2013 DATE OF PRONOUNCEMENT : 31.05.2013 ORDER PER A.L. GEHLOT, ACCOUNTANT MEMBER: 2 ITA NO.293 & 292/AGRA/2011 A.YS. 2008-09 THESE ARE APPEALS FILED BY THE REVENUE AGAINST TWO SEPARATE ORDERS, BOTH DATED 25.05.2011, OF THE LD. CIT(A), GHAZIABAD FOR THE ASSESSMENT YEARS 2008-09. 2. THE REVENUE HAS RAISED SOME COMMON GROUNDS IN BO TH THE APPEALS BASED ON IDENTICAL SET OF FACTS. THEREFORE, FOR THE SAKE OF CONVENIENCE BOTH THE APPEALS ARE DECIDED BY THIS COMMON ORDER. 3. THE GROUNDS RAISED BY THE REVENUE IN BOTH THE AP PEALS ARE AS UNDER :- ITA NO.293/AGRA/2011 IN THE CASE OF SMT. NALINI P. KAPOOR 1. THE LD. COMMISSIONER OF INCOME TAX (APPEALS) HA S ERRED IN LAW AND ON FACTS IN DELETING THE ADDITION OF RS.20,30,8 77/- ON ACCOUNT OF LONG TERM CAPITAL GAIN IN PROPERTY AT BOMBAY IN VI EW OF THE PROVISIONS OF SECTION 50C OF THE I.T. ACT 1961 BY M AKING OBSERVATION THAT AO IS MAKING ASSESSMENT OF LTCG FOR SALE OF PR OPERTY BY THE FIRM M/S KASHINATH KAPOOR & SONS IN THE HANDS OF TH E ASSESSES MRS. RAJESHWARI KAPOOR, HOWEVER THE FACT IS THAT THE AO HAS NOT ASSESSED THE LTCG IN THE HANDS OF ASSESSEE BUT ESTIMATED THE CONCEALMENT IN LTCG BY THE FIRM AND ADDED ONLY THAT PORTION OF EST IMATED CONCEALED LTCG IN THE HANDS OF ASSESSEE WHICH AS A SHARE HOLD ER OF 25% IN THE SAID FIRM, THE ASSESSEE WOULD HAVE GOT. 2. THE LD. COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED ON FACTS IN DELETING THE ADDITION OF RS.86,94,375/- ON ACCOUNT OF UNDISCLOSED INVESTMENT MADE IN PURCHASE OF SHARE OF HOUSE PROPERTY AT MUMBAI. 3. THE LD. COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED IN LAW AND ON FACTS TAKING INTO ACCOUNT ADDITIONAL EVIDENC ES PUT UP BY THE 3 ITA NO.293 & 292/AGRA/2011 A.YS. 2008-09 ASSESSEE/ASSESSEES COUNSEL DURING THE COURSE OF HE ARING AND PASSING ORDER ON THE BASIS OF ADDITIONAL FACTS WITHOUT ASKI NG REMAND REPORT FROM THE CONCERNED A.O. 4. APPELLANT CRAVES LEAVE TO AMEND, ALTER, ADD OR M ODIFY ANY GROUND OR GROUND OF APPEAL EITHER BEFORE OR AT THE TIME OF HEARING OF CASE. ITA NO.292/AGRA/2011 IN THE CASE OF SMT. RAJESHWARI A KAPOOR 1. THE LD. COMMISSIONER OF INCOME TAX (APPEALS) HA S ERRED IN LAW AND ON FACTS IN DELETING THE ADDITION OF RS.20,30,8 77/- ON ACCOUNT OF LONG TERM CAPITAL GAIN IN PROPERTY AT BOMBAY IN VI EW OF THE PROVISIONS OF SECTION 50C OF THE I.T. ACT 1961 BY M AKING OBSERVATION THAT AO IS MAKING ASSESSMENT OF LTCG FOR SALE OF PR OPERTY BY THE FIRM M/S KASHINATH KAPOOR & SONS IN THE HANDS OF TH E ASSESSES MRS. RAJESHWARI KAPOOR, HOWEVER THE FACT IS THAT THE AO HAS NOT ASSESSED THE LTCG IN THE HANDS OF ASSESSEE BUT ESTIMATED THE CONCEALMENT IN LTCG BY THE FIRM AND ADDED ONLY THAT PORTION OF EST IMATED CONCEALED LTCG IN THE HANDS OF ASSESSEE WHICH AS A SHARE HOLD ER OF 25% IN THE SAID FIRM, THE ASSESSEE WOULD HAVE GOT. 2. THE LD COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED IN LAW AND ON FACTS IN DELEING THE ADDITION OF RS.90,000/- ON ACCOUNT OF INTEREST NOT CHARGED TO LOAN GIVEN TO SMT. NALINI K APOOR. 3. THE LD COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED IN LAW AND ON FACTS IN DELETING THE ADDITION OF RS.4,50,00 0/- ON ACCOUNT OF DIFFERENCE IN ASSESSEES ACCOUNT IN THE BOOKS OF M/ S K.K. SYNTHETICS, KANPUR. 4. THE LD. COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED IN LAW AND ON FACTS DELETING THE ADDITION OF RS.3,10,2 23/- ON ACCOUNT OF DIFFERENCE IN EXPENSES SHOWN IN THE MARRIAGE OF HIS DAUGHTER. 5. THE LD COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED ON FACTS DELEING THE ADDITION OF RS.3,90,688/- ON ACCO UNT OF MONEY CONTRIBUTED OR MARRIAGE EXPENSES AS NO BILLS WERE P RODUCED. 4 ITA NO.293 & 292/AGRA/2011 A.YS. 2008-09 6. THE LD. COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED IN LAW AND FACTS DELETING THE ADDITION OF RS.1,00,000/- ON ACCOUNT OF HOUSE HOLD WITHDRAWALS SHOWN NIL BY THE ASSESSEE. 7. THE LD. COMMISSIONER OF INCOME TAX (APPEALS) HA S ERRED ON FACTS DELETING THE ADDITION OF RS.16,291/- ON ACCOU NT OF DOUBLE PAYMENTS MADE TO JYOTI DECORATOR, KANPUR. 8. APPELLANT CRAVES LEAVE TO AMEND, ALTER, ADD OR M ODIFY ANY GROUND OR GROUND OF APPEAL EITHER BEFORE OR AT THE TIME OF HEARING OF CASE. 4. FIRST WE TAKE UP ITA NO.293/AGRA/2011 IN THE CAS E OF SMT. NALINI P. KAPOOR THE FIRST COMMON GROUND RAISED IS IN RESPECT OF ADD ITION OF R.20,30,877/- ON ACCOUNT OF LONG TERM CAPITAL GAIN (LTCG). DURING T HE ASSESSMENT PROCEEDINGS, THE A.O. NOTICED THAT THE ASSESSEE IS A PARTNER IN THE FIRM NAMELY KASHI NATH KESAV & SONS, MUMBAI IN WHICH THE ASSESSEE IS HOLDING SHA RE OF 25%. THE FIRM SOLD PROPERTY OF THE FIRM SHOWING LTCG OF RS.75,002/-. ON EXAMINATION OF THE CAPITAL ACCOUNT OF THE ASSESSEE, THE A.O. NOTED THAT THE AS SESSEE HAS CREDITED LTCG FROM PROPERTY AS WELL AS FROM SHARES OF TISCO COMPANY AM OUNTING TO RS.75,002/- AND RS.54,209/- RESPECTIVELY. IT WAS ASKED TO THE ASSE SSEE TO EXPLAIN AS TO WHY THE LTCG WAS NOT SHOWN BY THE ASSESSEE. AFTER CONSIDE RING THE ASSESSEES SUBMISSION, THE A.O. NOTICED THAT THE PROPERTY ON W HICH THE ASSESSEE HAS SHOWN LTCG OF RS.75,002/- IN F.Y. 2007-08 AS THE PROPERTY HAS BEEN SOLD IN F.Y. 2007- 08. HENCE THE SALE VALUE PER SQUARE FEET MAY BE NE AR ABOUT THE SAME. THE A.O. 5 ITA NO.293 & 292/AGRA/2011 A.YS. 2008-09 ESTIMATED THE SALE VALUE OF THE PROPERTY ON WHICH A SSESSEE SHOWN LTCG ON SALE OF PROPERTY ON SAME RATE. THE A.O. DETERMINED THE TOT AL VALUE OF RS.84,23,520/- AND 25% OF ASSESSEES SHARE COMES TO RS.21,05,880/-. T HE A.O. NOTICED THAT THE ASSESSEE HAS SHOWN LTCG WRONGLY. THE A.O. CALCULAT ED THE LTCG UNDER SECTION 50C OF THE ACT AND DIFFERENCE OF THE SALE CONSIDERA TION CALCULATED BY THE A.O. AT RS.20,30,877, ASSESSEES SHARE (21,05,880 75,003/ -). THE A.O. HELD THAT THE FIRM HAS CONCEALED THE LTCG AND ALSO THE SHARE OF THE AS SESSEE WHICH COMES TO RS.20,30,877/-. THE A.O. MADE ADDITION OF THE SAID AMOUNT. 5. THE CIT(A) DELETED THE SAID ADDITION AS UNDER :- (PAGE NOS.12 & 13 FROM THE ENTIRE SET OF DOCUMENTARY EVIDENCES BROUG HT BEFORE ME, IT IS FAIRLY CLEAR THAT THE AO HAS MADE TOTALLY UN-NECESSARY AND ILLEGAL ADDITION, MERELY ON THE GROUND THAT SALE DE ED OF THE PROPERTY WAS NOT FURNISHED BEFORE THE A.O. THE FACT REMAINS AND IS VERIFIABLE FROM RECORD THAT THE SAID PROPERTY AT VIRAR WAS ALWAYS REFLECTED IN THE BALAN CE SHEET OF M/S KASHI NATH KAPOOR & SONS WHERE THE ASSESSEE AS WELL AS THE OTHER FAMILY MEMBER, SMT. RAJESHWARI KAPOOR ARE PARTNERS. THE PROPERTY WAS PURCHASED LONG BACK AND THE PURCHASE DOCUMENTS HAVE ALSO BEEN BROUGHT ON RECORD. THE FIRM IS ASSESSED TO TAX FOR A LONG TIME AND FIRMS PAN WAS ALSO MADE AVAILABLE TO THE AO BY THE ASSESSEE AND THE AO SHOULD HAVE MADE REQUISITE VERIFICATIONS FROM TH E FIRMS ASSESSMENT RECORDS. TO THAT EXTENT, THE AO HAS NOT DONE HIS DUTY AND HAS RATHER IMPOSED A HEAVY IMAGINARY INCOME IN THE HANDS OF THE ASSESSEE ALTHOUGH THE ASSESSEE IS NOT EVEN THE OWNE R OF THE PROPERTY SOLD. 6 ITA NO.293 & 292/AGRA/2011 A.YS. 2008-09 THE FIRM HAS SOLD THE PROPERTY AND HAS DULY DECLARE D THE CAPITAL GAIN IN ITS RETURN. IN CASE, THE AO FEELS THAT CAPITAL GAIN MIGHT NOT HAVE BEEN DECLARED CORRECTLY; HE CAN ALWAYS VER IFY OR GET VERIFIED THROUGH HIS COUNTER PART I.E. THE AO WHO IS ASSESSI NG THE FIRM THIS ISSUE IN THE HANDS OF THE FIRM BUT THERE IS NO LOGI C AT ALL OF SADDLING THE ASSESSEE WITH THE OWNERSHIP AND SALE OF PROPERT Y. THE ENTIRE SET OF PURCHASE DEED DATED 27.09.1991 AS WELL AS SALE DEED DATED 23.03.2007 HAS BEEN PERSONALLY VERI FIED BY ME AND IT IS CLEAR THAT THE PURCHASE AS WELL AS SALE IS ALL B Y THE FIRM AND THERE IS NO OWNER-SHIP OF THE PARTNERS, INDIVIDUALLY. THERE FORE, THE ADDITION IS ENTIRELY BASELESS. FURTHER, THE AO HAS NOT ONLY DISREGARDED THE ABOVE FACTS BUT HAS ALSO USED A RIDICULOUS BASIS OF VALUING THE PRO PERTY ON THE BASIS OF ANOTHER PROPERTY PURCHASED BY THE ASSESSEE WHICH IS PHYSICALLY SO DISTANT FROM THIS PROPERTY !! I AM FULLY CONVINCED BY THE ARGUMENTS AND DOCUMENTA RY EVIDENCES PUT FORTH BY THE APPELLANT, AND HENCE HOL D THAT NO CAPITAL GAIN ON ACCOUNT OF SALE OF PROPERTY AT VIRAR CAN BE ASSESSED IN THE HANDS OF THE APPELLANT AND SMT. RAJESHWARI KAPOOR. THUS, THE ADDITION OF RS.20,30,870/- IS SUMMARILY D ELETED. 6. WE HAVE HEARD THE LD. REPRESENTATIVES OF THE PAR TIES AND RECORDS PERUSED. WE NOTICE THAT THE A.O. HAS MADE THE ADDITION WITHO UT APPRECIATING THE FACTS AS NOTED BY THE CIT(A) THAT ENTIRE SET OF DOCUMENTARY EVIDENCE BROUGHT BEFORE HIM WAS VERY CLEAR AND THE A.O. HAS UNNECESSARILY AND I LLEGALLY MADE THE ADDITION MERELY ON THE GROUND THAT THE SALE DEED OF THE ASSE SSEE WAS NOT FURNISHED BEFORE THE A.O. THE CIT(A) NOTICED THAT THE PROPERTY WAS PURCHASED BY THE PARTNERSHIP FIRM LONG BACK AND PURCHASE DOCUMENT WERE ALSO BROU GHT ON RECORD. THE FIRM IS 7 ITA NO.293 & 292/AGRA/2011 A.YS. 2008-09 ASSESSED TO TAX FOR A LONG TIME AND THE FIRMS PAN WAS ALSO MADE AVAILABLE TO THE A.O. BY THE ASSESSEE. THE CIT(A) OBSERVED THAT THE A.O. SHOULD HAVE MADE THE REQUISITE VERIFICATIONS FROM THE FIRMS ASSESSMENT RECORDS. THE CIT(A) HAS GIVEN FINDING THAT THE ASSESSEE IS NOT EVEN OWNER OF THE PROPERTY SOLD. THE FIRM HAS SOLD THE PROPERTY AND HAS DULY DECLARED THE CAPITAL GAIN IN IS RETURN. THE CIT(A) FURTHER OBSERVED THAT IN CASE THE A.O. FEELS THAT CAPITAL G AIN MIGHT NOT HAVE BEEN DECLARED CORRECTLY, HE CAN ALWAYS VERIFY OR GET VERIFIED THR OUGH HIS COUNTERPART WHO IS ASSESSING THE FIRM THIS ISSUE IN THE HANDS OF THE F IRM BUT THERE IS NO LOGIC AT ALL OF SADDLING THE ASSESSEE WITH THE OWNERSHIP AND SALE O F PROPERTY. THE CIT(A) NOTED THAT THE ENTIRE SET OF PURCHASE DEED DATED 27.09.19 91 AND SALE DEED DATED 23.03.2007 HAS BEEN PERSONALLY VERIFIED BY THE CIT( A) AND FOUND THAT THE PURCHASE AS WELL AS SALE IS CARRIED OUT BY THE FIRM AND THER E IS NO OWNERSHIP OF THE PARTNERS INDIVIDUALLY. THE ABOVE DETAILED FINDINGS HAVE BEE N GIVEN BY CIT(A) IN CASE OF SMT. NALINI P. KAPOOR AND THIS DETAILED DISCUSSION HAS BEEN FOLLOWED IN THE CASE OF SMT. RAJESHWARI KAPOOR AS THE ISSUE IS SAME. 7. IN THE LIGHT OF THE DETAILED DISCUSSIONS MADE BY THE CIT(A) PARTICULARLY FINDING THAT THE PROPERLY BELONGED TO THE FIRM AND NOT TO THE INDIVIDUAL PARTNER NEITHER BY SMT. NALINI P. KAPOOR OR SMT. RAJESHWARI KAPOOR. THE A.O. MADE THE ADDITION WITHOUT APPRECIATING THE FACTS. THE CIT(A ) EXAMINED THE ENTIRE SET OF 8 ITA NO.293 & 292/AGRA/2011 A.YS. 2008-09 PURCHASE DEED DATED 27.09.1991 AS WELL AS SALE DEED DATED 23.03.2007. THE REVENUE HAS FAILED TO POINT OUT ANY CONTRARY MATERI AL TO THE FINDING OF CIT(A). IN THE LIGHT OF THE FACT, ORDER OF CIT(A) IS CONFIRMED ON THE ISSUE. 8. THE SECOND GROUND OF REVENUE RAISED IN THE CASE OF SMT. NALINI K. KAPOOR IS IN RESPECT OF DELETION OF ADDITION OF RS.86,94,3 75/-. THE ADDITION MADE BY THE A.O. HAS BEEN DELETED BY THE CIT(A) AS UNDER :- (PA GE NOS 13, 14 & 15) I FIND THAT EVEN THIS ADDITION IS WITHOUT ANY LEG S AND THAT THE ENTIRE REASONING AS WELL AS THE AMOUNTS CONSIDERED BY THE AO ARE AT WILD VARIANCES WITH ACTUAL FACTS. THE BASIC FACT IS THAT THE ASSESSEE PURCHASED A NEW PROPERTY HAVING SHARE ALONG WITH HER SON SHRI SOHIT KAPOOR FROM M/S MACROTECH CONSTRUCTION PVT. LIMITED, MUMBAI VIDE MO U DATED 30 TH JANUARY, 2007 FOR A TOTAL CONSIDERATION OF RS.3,16, 39,104/-. THE PAYMENTS WERE MADE IN AGREED INSTALLMENTS LATER, TH E MOU WAS CONVERTED INTO AN AGREEMENT TO SELL DATED 27 TH FEBRUARY, 2007. THE APPELLANT HAS PAID A TOTAL AMOUNT OF RS.1,66,16,907 /- (BEING OF THE TOTAL CONSIDERATION) ON VARIOUS DATES FALLING INTO VARIOUS FINANCIAL YEARS AS MENTIONED BELOW : FINANCIAL YEAR AMOUNT PAID 2006-07 RS.55,43,220/- 2007-08 RS.15,81,955/- 2008-09 RS.31,63,910/- 2009-10 RS.47,45,863/- 2010-11 RS.15,81,959/- RS.1,66,16,907/- THE ENTIRE SCHEDULE OF PAYMENTS, DATES OF PAYMENTS, AND PROOF REGARDING THE SAME ARE ALL ON RECORD AND ARE DULY R EFLECTED IN 9 ITA NO.293 & 292/AGRA/2011 A.YS. 2008-09 ASSESSEES ACCOUNTS AS WELL AS IN BALANCE SHEET. W HAT COMES OUT OF THE ABOVE IS THAT, AT THE MOST, THE AO COULD CONSID ER, IN THE PRESENT ASSESSMENT PROCEEDINGS, THE SOURCE OF PAYMENT OF ON LY RS.15,81,959/- BECAUSE THAT IS THE AMOUNT PAID DURING THE RELEVANT YEAR. ALL OTHER AMOUNTS WILDLY MENTIONED BY HE AO ARE NOT PERTAININ G O THE YEAR UNDER CONSIDERATION. SO, THE SOURCE OF THE SAME, E VEN IF DOUBTED, CANNOT BE QUESTIONED AND ANY ADDITION CAN NOT BE MA DE IN RESPECT OF THE SAME, IN THIS ASSESSMENT YEAR. REGARDING RS.15,81,959/-, I FIND THAT THE SOURCE OF THIS PAYMENT IS WELL EXPLAINED AND PROVED; THE FUND COMING FROM THE BALANCE OF THE ASSESSEE WITH THE FIRM M/S KASHI NATH KAPOOR & SONS . I.T. DETAILS, CAPITAL ACCOUNTS, BALANCE SHEETS OF A SSESSEE AS WELL AS HER SON (CO-OWNER) ARE ALL ON RECORD; ALL OF WHI CH CLEARLY PROVE THE CREDITWORTHINESS AND ESPECIALLY THE SOURCE OF FUND USED FOR PURCHASE OF THIS PROPERTY, ESPECIALLY (TO REPEAT) THE PAYMEN T OF RS.15,81,959/-, WHICH IS THE AMOUNT RELEVANT FOR THIS YEAR. THUS, HE ENTIRE REASONING OF THE AO AND THE AMOUNTS MENTIONED ARE FOUND TO BE ARBITRARY AND IRRELEVANT FOR THE AS SESSMENT OF THIS YEAR, AND ADDITION MADE IS BASELESS AND WITHOUT DUE APPLICATION OF MIND. CONSEQUENTLY, THE ADDITION OF RS.86,94,375/- IS DELETED. 9. WE HAVE HEARD THE LD. REPRESENTATIVES OF THE PAR TIES AND RECORDS PERUSED. WE NOTICE THAT THE A.O. HAS MADE THE ADDITION WITHO UT APPRECIATING THE FACT OF THE CASE. THE PROPERTY PURCHASED BY THE ASSESSEE HAVIN G ONE AND HALF SHARE ALONG WITH HER SON SHRI SOHIT KAPOOR FOR A TOTAL CONSIDERATION OF RS.3,16,39,104/-. THE PAYMENTS WERE MADE IN AGREED INSTALLMENTS. LATER, THE MOU WAS CONVERTED INTO AGREEMENT TO SELL DATED 27.02.2007. THE ASSESSEE P AID TOTAL AMOUNT OF RS.1,66,16,907/-. THE AMOUNTS PAID IN DIFFERENT YE ARS HAD BEEN REFLECTED IN THE 10 ITA NO.293 & 292/AGRA/2011 A.YS. 2008-09 REGULAR BOOKS OF ACCOUNT AS WELL AS IN BALANCE SHEE T AS NOTED BY THE CIT(A) IN HIS ORDER. THE CIT(A) NOTED THAT ALL THE AMOUNTS MENTI ONED BY THE A.O. WERE PERTAINING TO THE YEAR UNDER CONSIDERATION. THE CI T(A) FOUND THAT THE SOURCE OF PAYMENT OF RS.15,81,959/- WAS WELL EXPLAINED AND PR OVED, THE FUND COMING FROM THE BALANCE OF THE ASSESSEE WITH FIRM M/S KASHI NAH KAPOOR & SONS. THIS FACT HAS BEEN VERIFIED BY THE CIT(A) AND FOUND TO BE CORRECT IN THE LIGHT OF THE DETAILED DISCUSSIONS MADE BY CIT(A). THE REVENUE HAS FAILED TO POINT OUT ANY CONTRARY MATERIAL TO THE FINDING OF THE CIT(A). IN THE LIGH T OF THE FACT, ORDER OF CIT(A) IS CONFIRMED ON THE ISSUE. ITA NO.292/AGRA/2011 IN THE CASE OF SMT. RAJESHWARI KAPOOR 10. NOW WE TAKE UP ITA NO.292/AGRA/2011 IN THE CASE OF SMT. RAJESHWARI KAPOOR. GROUND NO.1 HAS BEEN DECIDED WHILE DECIDIN G APPEAL IN THE CASE OF SMT. NALINI P. KAPOOR IN PARAGRAPH NOS.6 & 7 OF THIS ORD ER. FOLLOWING THE SAID DISCUSSION, GROUND NO.1 OF REVENUES APPEAL IS DISM ISSED. 11. GROUND NO.2 IS PERTAINING TO ADDITION OF RS.90, 000/- ON ACCOUNT OF INTEREST. THE A.O. ON EXAMINATION OF THE BALANCE SHEET NOTICE D THE ASSESSEE HAS SHOWN CREDIT ENTRIES IN THE NAME OF SMT. NALINI P. KAPOOR AT RS.5,00,000/-. THE A.O. 11 ITA NO.293 & 292/AGRA/2011 A.YS. 2008-09 NOTICED THAT THE ASSESSEE HAS NOT CHARGED INTEREST. HE ACCORDINGLY CALCULATED INTEREST APPLYING 18% RATE OF INTEREST. THE CIT(A) DELETED THE ADDITION AS UNDER :- (PAGE NOS.17 & 18) THIS ADDITION IS ALSO UNWARRANTED BECAUSE FIRSTLY NO INTEREST CLAIM HAS BEEN MADE IN PROFIT & LOSS ACCOUNT AND SO THERE IS NO QUESTION OF ANY DISALLOWANCE!! SECONDLY, TO EXPLAI N THE ISSUE FURTHER, IT IS SEEN THAT THE ASSESSEE HAS GIVEN HER OWN MONE Y O HER BABHI, MRS. NALINI KAPOOR ON INTEREST FREE BASIS. NEITHER ANY INTEREST HAS BEEN CLAIMED TO BE RECEIVED BY THE ASSESSEE NOR ANY INTE REST HAS BEEN CLAIMED TO BE PAID ON ANY FUND BORROWED. SMT. NALI NI KAPOOR HAS ALSO NOT CLAIMED ANY INTEREST PAYMENT. JUST BECAUSE THE ASSESSEE IS CHARGING INTEREST FROM CERTAIN RELATIVES DOES NOT MAKE IT NECESSARY THAT SHE SHOUL D CHARGE INTEREST FROM ALL OTHERS!! AS LONG AS ASSESSEE HAS SURPLUS FUND, IT IS HER PREROGATIVE TO GIVE INTEREST FREE FUNDS TO ANY ONE SHE LIKES. IN EFFECT, THIS ADDITION OF RS.90,000/- IS ON ACCOU NT OF NOTIONAL INCOME WHICH IS AGAINST THE TENET OF LAW. THE ADDI TION OF RS.90,000/-, IS, THEREFORE, DELETED. 12. WE HAVE HEARD THE LD. REPRESENTATIVES OF THE PA RTIES AND RECORDS PERUSED. THE CIT(A) NOTED THAT THE ASSESSEE DID NOT MAKE ANY INTEREST CLAIM, THEREFORE, THERE IS NO QUESTION OF ANY DISALLOWANCE. THE CIT( A) FURTHER NOTICED THAT THE AMOUNT WAS GIVEN OUT OF OWN MONEY. REVENUE HAS FAI LED TO POINT OUT ANY CONTRARY MATERIAL TO THE FINDING OF CIT(A). IN THE LIGHT OF THE FACT, ORDER OF CIT(A) IS CONFIRMED ON THE ISSUE. 12 ITA NO.293 & 292/AGRA/2011 A.YS. 2008-09 13. GROUND NO.3 IS IN RESPECT OF DELETION OF ADDITI ON OF RS.4,50,000/-. THE ADDITION MADE BY THE A.O. HAS BEEN DELETED BY THE C IT(A) AS UNDER :- (PAGE NO.15) I FIND THAT AOS VIEWS AND REASONING FOR THE ADDIT ION OF RS.4,50,000/- IS WITHOUT CLARITY AND LOGIC. IT IS VERIFIABLE THAT CASH WITHDRAWALS HAVE BEEN MADE BY THE ASSESSEE OUT OF C ASH BOOK OF THE FIRM IN WHICH SHE IS PARTNER. FURTHER, SOURCE OF T HIS CASH WITHDRAWAL IS WELL EXPLAINED IN VIEW OF THE FACT THAT THE FIRM HAD SUFFICIENT CASH BALANCE. IT IS ALSO VERIFIABLE THAT LATER, THIS AM OUNT WAS REPAID BY THE ASSESSEE TO M/S. K.K. ENTERPRISES; THE SOURCE BEING HER FUND BALANCE IN ANOTHER FIRM, M/S K.K. TRADERS. THUS, ALL THE LIMBS OF TRANSACTIONS ARE CLEAR AND E XPLAINED. APPARENTLY, THE AO HAS FAILED TO UNDERSTAND THESE T RANSACTIONS. THERE IS NOTHING, WHICH CREATES ANY DOUBT OR SUSPIC ION REGARDING THE NATURE OF TRANSACTION AND SOURCE OF F UND. 14. WE HAVE HEARD THE LD. REPRESENTATIVES OF THE PA RTIES AND RECORDS PERUSED. THE CIT(A) NOTED THAT THE ASSESSEE HAS EXPLAINED TH E TRANSACTION. THIS AMOUNT WAS REPAID BY THE ASSESSEE TO M/S. K.K. ENTERPRISES . THE SOURCE OF FUND WAS BALANCE IN ANOTHER FIRM M/S. K.K. TRADERS. THE CIT (A) NOTED THAT THE A.O. HAS FAILED TO UNDERSTAND THE NATURE OF TRANSACTION. TH E REVENUE HAS FAILED TO POINT OUT ANY CONTRARY MATERIAL TO THE FINDING OF CIT(A). IN THE LIGHT OF THE FACT, ORDER OF CIT(A) IS CONFIRMED ON THE ISSUE. 15. GROUND NO.4 PERTAINS TO ADDITION OF RS.3,10,223 /-. THE ADDITION MADE BY THE A.O. HAS BEEN DELETED BY THE CIT(A) AS UNDER :- (PA GE NO.16) 13 ITA NO.293 & 292/AGRA/2011 A.YS. 2008-09 AGAIN, I FIND THAT THE AO HAS FAILED TO APPRECIATE THE BASIC FACTS AND ISSUES. THE FACT REMAINS (AS MENTIONED BY THE AO A S WELL AS IN THE ASSESSMENT ORDER) THAT IN CONNECTION WITH THE MARRI AGE OF ASSESSEES DAUGHTER, VARIOUS INDIVIDUALS CONTRIBUTED MONEY TOT ALING O RS.15,69,727/- (THE AO HAS MENTIONED THE AMOUNT OF RS.15,62,755/-, BUT THE APPELLANT HAS GIVEN FULL DETAILS ACCORDING TO WHICH THE TOTAL AMOUNT IS RS.15,69,727/-); OUT OF WHICH THE CONTRIB UTION BY THE MOTHER (ASSESSEE) WAS DECLARED TO BE RS.7,60,223/-. THIS FACT IS CLEARLY REFLECTED IN HER CAPITAL ACCOUNT. THEREFOR E, ONCE THE ASSESSEE HAS HERSELF DECLARED AND SHOWN THIS EXPENDITURE; WH AT IS THE RATIONALE OF ADDING BACK OF PORTION OF THE SAME!? THE SOURCE OF THIS EXPENDITURE IS EXPLAINABLE FROM THE ACCOUNTS. IT IS NOT THE CASE OF THE A.O. THAT HE HAS DETECTED ANY FURTHER EXPENDITURE INCURRED ON MARRIAGE, BESIDES RS.15,69, 727/-, FROM UNACCOUNTED SOURCE. SO, FROM NO ANGLE, THIS ADDITION GETS JUSTIFIED. H IS ADDITION OF RS.3,10,223/- IS, THEREFORE, DELETED. 16. THE CIT(A) NOTED THAT THE A.O. HAS MADE THE ADD ITION WITHOUT APPRECIATING THE FACTS OF THE CASE. THE CIT(A) NOTED THAT THE A SSESSEE HAS EXPLAINED THE SOURCE OF THE MARRIAGE EXPENSES FROM THE BOOKS OF ACCOUNT. THE A.O. DID NOT FIND ANY MATERIAL BASED ON WHICH ADDITION CAN BE MADE. WE N OTICE THAT THE CIT(A) AFTER APPRECIATING THE FACTS AND AFTER EXAMINING NECESSAR Y FACTS FOUND THAT THE A.O. HAS NOT DETECTED ANY FURTHER EXPENDITURE INCURRED ON MA RRIAGE BESIDES RS.15,69,727/- FROM UNACCOUNTED SOURCES. THE REVENUE HAS FAILED T O POINT OUT ANY CONTRARY MATERIAL TO THE FINDING OF CIT(A). IN THE LIGHT OF THE FACT, WE CONFIRM THE ORDER OF THE CIT(A) ON THE ISSUE. 14 ITA NO.293 & 292/AGRA/2011 A.YS. 2008-09 17. GROUND NO.5 IS IN RESPECT OF ADDITION OF RS.3,9 0,688/-. THE ADDITION MADE BY THE A.O. HAS BEEN DELETED BY THE CIT(A) AS UNDER :_ (PAGE NO.17) AS EXPLAINED AND MENTIONED ABOVE, HE ASSESSEE AND HER FAMILY MEMBERS HAVE THEMSELVES DECLARED CONTRIBUTION TOWAR DS MARRIAGE EXPENSES TOTALING TO RS.15,69,727/-. THE AO HAS MA DE ENQUIRIES U/S 133(6) FROM VARIOUS PARTIES IN RESPECT OF WORKS DON E/ITEMS PROVIDED BY THEM ON THE OCCASION OF MARRIAGE AND PAYMENTS RE CEIVED BY THEM. THESE REPLIES ARE IN CONFORMITY WITH THE DETAILS AN D SUBMISSIONS MADE BY THE APPELLANT AND OTHER FAMILY MEMBERS. THUS, THERE IS NO EVIDENCE OR EVEN INDICATIONS FOR ANY EXPENDITURE, OVER AND ABOVE THE DECLARED AMOUNT OF RS.15,69,727/-. THE ADDITION MADE BY THE AO IS PURELY ON ESTIMATED BASIS WITHOUT ANY SUBSTANCE. IN FACT THE AO USES THE WORD 1/4 TH DISALLOWED OF TOTAL EXPENDITURE ., WHICH IS ITSELF RIDICULOUS. WHEN THE ASSESSEE HERSELF IS DECLARING HER CONTRIBUTION TOWARDS MARRI AGE EXPENSES; WHY SHOULD AO DISALLOW A PORTION OF THE SAME !? APPARE NTLY, THE AO WANTED TO ADD, ON ESTIMATED BASIS, SOME ADDITIONAL AMOUNT OF MARRIAGE EXPENDITURE. HOWEVER, AS STATED ABOVE, TH ERE IS NEITHER ANY EVIDENCE NOR ANY INDICATION FOR THE SAME. THE ADDITION OF RS.3,90,688/- IS, THEREFORE, DELETE D. 18. THIS ISSUE IS ALSO IDENTICAL TO GROUND NO.4 WHI CH HAS BEEN DECIDED ABOVE. THE REVENUE HAS FAILED TO POINT OUT ANY CONTRARY MA TERIAL TO THE FINDING OF THE CIT(A). IN THE LIGHT OF THE FACT, ORDER OF THE CIT (A) IS CONFIRMED ON THE ISSUE. 15 ITA NO.293 & 292/AGRA/2011 A.YS. 2008-09 19. GROUND NO.6 IS IN RESPECT OF ADDITION OF RS.1,0 0,000/- ON ACCOUNT OF HOUSE HOLD EXPENSES. THE ADDITION MADE BY THE A.O. HAS B EEN DELETED BY THE CIT(A) AS UNDER:- (PAGE NOS.15 & 16) THE GROUND IS REGARDING ADDITION OF RS.1,00,000/- ON ACCOUNT OF LOW HOUSE HOLD WITHDRAWALS. I FIND THAT SOME AD DITION HAS BEEN MADE IN THE HANDS OF THE ASSESSEES HUSBAND, SHRI R AJESH KAPOOR, ON ACCOUNT OF LOW HOUSE HOLD WITHDRAWALS. BOTH SHRI R AJESH KAPOOR AS WELL AS THE ASSESSEE HAVE TAKEN THE STAND THAT HOUS E HOLD EXPENSES ARE BEING MET BY THE HUSBAND SHRI RAJESH KAPOOR. THEREFORE I AGREE THAT THE ISSUE OF HOUSE HOLD EXPE NSES ARE REQUIRED TO BE ADJUDICATED IN THE HANDS OF SHRI RAJ ESH KAPOOR. NO ADDITION IS WARRANTED IN THE HANDS OF THE ASSESSEE. THE ADDITION OF RS.1,00,000/- IS, THEREFORE DELETED . 20. WE NOTICE THAT THE REVENUE HAS FAILED TO POINT OUT ANY CONTRARY MATERIAL TO THE FINDING OF THE CIT(A). THE CIT(A) FOND THAT IF ANY ADDITION IS TO BE MADE THAT IS TO BE MADE IN THE HANDS OF THE ASSESSEES HUSBAN D AND NOT IN THE HANDS OF THE ASSESSEE. SINCE THERE IS NO CONTRARY MATERIAL TO T HE FINDING OF THE CIT(A) NOR THE SAME HAS BEEN POINTED OUT, IN THE LIGHT OF THE FACT , ORDER OF THE CIT(A) IS CONFIRMED ON THE ISSUE. 21. GROUND NO.7 IS IN RESPECT OF ADDITION OF R.16,2 91/-. THE ADDITION MADE BY THE A.O. HAS BEEN DELETED BY THE CIT(A) AS UNDER:- (PAGE NO.19) 16 ITA NO.293 & 292/AGRA/2011 A.YS. 2008-09 I FIND THAT THE ADDED AMOUNT OF RS.16,291/- IS CO MPOSED OF ACTUALLY TWO COMPONENT I.E. RS.16,291/- AND RS.558/ -. IT IS VERIFIABLE FROM THE RECORDS THAT BOTH THESE AMOUNTS ARE PROPER LY REFLECTED IN THE BOOKS. THE AMOUNT OF RS.16,291/- IS MARRIAGE EXPEN DITURE WHICH IS DEBITED IN THE CAPITAL ACCOUNT OF SHRI MOHIT KAPOOR WHILE RS.558/- IS THE MARRIAGE EXPENSES DEBITED IN THE CAPITAL A/C OF RAJESHWARI KAPOOR. BOTH THESE EXPENSES ARE PROPERLY REFLECTED IN THE ACCOUNTS AND ARE FROM EXPLAINED SOURCES. THUS, THERE IS NO BASIS FOR ANY ADDITION. THE ADDITION OF RS.16,291/- IS, THEREFORE, DELETED . 22. THE CIT(A), AFTER APPRECIATING THE FACTS, FOUND THAT THE MARRIAGE EXPENSES HAD BEEN PROPERLY REFLECTED IN THE ACCOUNTS AND ARE FROM EXPLAINED SOURCES. THE REVENUE HAS FAILED TO POINT OUT ANY CONTRARY MATERI AL TO THE FINDING OF CIT(A). IN THE LIGHT OF THE FACT, ORDER OF CIT(A) IS CONFIRMED ON THE ISSUE. 23. IN THE RESULT, BOTH THE APPEALS OF THE REVENUE ARE DISMISSED. (ORDER PRONOUNCED IN THE OPEN COURT) SD/- SD/- (BHAVNESH SAINI) (A.L. GEHLOT) JUDICIAL MEMBER ACCOUNTANT MEMBER PBN/* 17 ITA NO.293 & 292/AGRA/2011 A.YS. 2008-09 COPY OF THE ORDER FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT (APPEALS) CONCERNED 4. CIT CONCERNED 5. D.R., ITAT, AGRA BENCH, AGRA 6. GUARD FILE. BY ORDER SR. PRIVATE SECRETARY INCOME-TAX APPELLATE TRIBUNAL, AGRA TRUE COPY