Suresh Babu soni, Gwalior V. I.T.O., Ward-2(3), Gwalior

ITA 312/AGR/2013

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 9983 (ITAT-AGRA)
• Duration Of Justice: 2 year(s) 5 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-02-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 20-08-2014
• Assessment Year: 2009-2010
• Appeal Filed On: 21-08-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: ASHOK VIJAYWARGIYA
• Section: 69

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, AGRA BENCH, AGRA BEFORE : SHRI BHAVNESH SAINI, JUDICIAL MEMBE R AND MRS. ANNAPURNA MEHROTRA, ACCOUNT ANT MEMBER ITA NO. 312/AGRA/2013 ASSTT. YEAR : 2009-10 SURESH BABU SONI, VS. INCOME-TAX OFFICER, 15-GANGA VIHAR, NEAR KAROLI, WARD 2(3), GWALIOR. MATA MANDIR, MAHALGAON, CITY CENTRE, GWALIOR. [PAN: AHIPS 1795 B] (APPELLANT) (RESPONDENT) APPELLANT BY : SH. RAJENDRA SHARMA, ADVOCATE & SH. ASHOK VIJAYWARGIYA, C.A. RESPONDENT BY : SHRI WASEEM ARSHAD, SR. DR DATE OF HEARING : 05.02.2016 DATE OF PRONOUNCEMENT : 10.02.2016 ORDER PER BHAVNESH SAINI, JUDICIAL MEMBER: THIS APPEAL BY THE ASSESSEE HAS BEEN DIRECTED A GAINST THE ORDER OF LD. CIT(A), GWALIOR DATED 31.07.2013 FOR THE ASSESSMENT YEAR 2009-10 CHALLENGING THE ADDITION OF RS.17,50,000/- ON ACCOU NT OF DEPOSIT IN SAVING BANK ACCOUNT. 2. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSE E CHALLENGED THE ADDITION OF RS.17,50,000/- BEFORE THE LD. CIT(A) FOR UNEXPLA INED CASH CREDIT U/S. 69 OF ITA NO.312/AGRA/2013 2 THE IT ACT. IN THIS CASE THE ASSESSEE HAS DEPOSITED RS.17,50,000/- IN HIS SB A/C ON 09.06.2008 WHICH WAS EXPLAINED AS ADVANCE RECEIV ED AGAINST THE SALE OF PROPERTY. THE AO, HOWEVER, DID NOT ACCEPT THE EXPLA NATION OF THE ASSESSEE. THE CRUX OF THE FINDINGS OF THE AO HAD BEEN THAT THE AS SESSEE EXPLAINED BEFORE HIM THAT THE ASSESSEE HAS RECEIVED AS ADVANCE AGAINST S ALE OF PROPERTY FROM THE PARTIES AND AFFIDAVITS HAVE BEEN FILED AND THEY WER E ALSO PRODUCED BEFORE THE AO FOR EXAMINATION AND THEY HAVE CONFIRMED GIVING A DVANCE TO THE ASSESSEE WHICH WAS DEPOSITED IN THE BANK ACCOUNT OF THE ASSE SSEE. THE ASSESSEE PRODUCED THE TITLE DEED OF THE PROPERTY UNDER SALE. THE AO, HOWEVER, REJECTED THE CONTENTION OF THE ASSESSEE OBSERVING THAT THE A SSESSEE WAS NOT HAVING THE TITLE OVER THE PROPERTY BECAUSE HIS OTHER THREE BRO THERS WERE ALSO CO-OWNERS. ALL THE PURCHASERS IN THEIR AFFIDAVIT HAVE MENTIONE D THE SAME LANGUAGE AND THEY ARE AGRICULTURISTS. ALL KEPT THE AMOUNT WITH T HEM IN CASH. IT IS NOT EXPLAINED THAT WITHOUT CONSENT OF THE MOTHER AND BR OTHER OF THE ASSESSEE, HOW AGREEMENT WAS ENTERED INTO. THE AO ACCORDINGLY, MAD E THE ADDITION. 3. THE ASSESSEE CHALLENGED THE ADDITION BEFORE THE LD. CIT(A) AND HIS WRITTEN SUBMISSIONS ARE REPRODUCED IN THE APPELLATE ORDER IN WHICH THE ASSESSEE BRIEFLY EXPLAINED THAT HE HAD ENTERED INTO THE AGREEMENT FOR SALE OF FAMILY PROPERTY WITH FOUR PERSONS, NAMELY SHRI AJME R SINGH, SH. NARAYAN ITA NO.312/AGRA/2013 3 SINGH, SH. MATADEEN AND SHRI SHIVRAJAN SHARMA. THE ASSESSEE HAD RECEIVED THE AMOUNT OF RS.17,50,000/- FROM THESE FOUR PERSONS TO WARDS ADVANCE AGAINST SALE OF PROPERTY ON 09.06.2008 WHICH WAS DEPOSITED IN HIS BANK ACCOUNT ON THE SAME DAY. THE ASSESSEE CHALLENGED THE OBSERVATI ON OF THE AO IN THE ASSESSMENT ORDER BY EXPLAINING THAT THE ASSESSEE HA D ENTERED INTO THE AGREEMENT FOR SALE OF PROPERTY WITH THE CONSENT OF OTHER FAMILY MEMBERS. ALL THE PURCHASERS HAVE CONFIRMED THIS FACT IN THEIR AF FIDAVIT AND ALL THE FOUR PERSONS WERE PRODUCED BEFORE THE AO AND THEIR STATE MENTS WERE RECORDED. THEY HAVE CONFIRMED GIVING OF ADVANCE TO THE ASSESS EE. ALL PERSONS WERE DOING THEIR OWN BUSINESS AND WERE HAVING INCOME FRO M DAIRY BUSINESS. IT WAS ALSO EXPLAINED THAT SINCE THE DEAL WAS NOT FINALIZE D / MATURED AND CANCELLED, THEREFORE, THE ASSESSEE WITHDREW THE AMOUNT FROM BA NK TO REFUND THE SAME TO THE PARTIES ON THE SAME DAY AND THIS FACT IS CONFIR MED BY THEM IN THEIR STATEMENT. IT WAS, THEREFORE, SUBMITTED THAT NO ADD ITION IS CALLED FOR IN THE MATTER. IT WAS EXPLAINED THAT AJMER SINGH AND SHRI SHIV RAJAN SHARMA HAVE ADVANCED RS.4,25,000/- EACH AGAINST THE PROPERTY AT BHIND. HOWEVER, SHRI MATADEEN AND SHRI NARAYAN SINGH, GAVE ADVANCE OF RS .4,50,000/- EACH AGAINST GWALIOR PROPERTY. THE STATEMENTS OF ALL THE PURCHAS ERS RECORDED BY THE AO HAVE BEEN REPRODUCED IN THE APPELLATE ORDER. THE ST ATEMENT OF ASSESSEE WAS ALSO RECORDED IN WHICH ALSO, HE HAS CONFIRMED THE S AME FACTS. THE ASSESSEE, ITA NO.312/AGRA/2013 4 THEREFORE, EXPLAINED THAT THE ASSESSEE ESTABLISHED THE IDENTITY OF THE PERSONS WHO HAVE GIVEN ADVANCE TO THE ASSESSEE AND GENUINEN ESS OF THE TRANSACTION IS PROVED. THEREFORE, THE CASE IS COVERED BY THE JUDGM ENT OF HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF CIT VS. ME TACHEM INDUSTRIES 245 ITR 160, IN WHICH IT WAS HELD THAT ONCE IT IS ESTABLISHED THAT THE AMOUNT HAS BEEN INVESTED BY PARTICULAR PERSON, BE HE A PARTNER OR A N INDIVIDUAL, THEN THE RESPONSIBILITY OF ASSESSEE IS OVER. WHETHER THAT PE RSON IS INCOME TAX PAYER OR NOT AND WHERE HE HAD BROUGHT THIS MONEY FROM, IT IS NOT THE RESPONSIBILITY OF THE FIRM. THE MOMENT THE FIRM GIVES SATISFACTORY EXPLANA TION AND PRODUCES THE PERSON WHO HAS DEPOSITED THE AMOUNT, THEN THE BURDE N OF THE FIRM IS DISCHARGED AND IN THAT CASE THAT CREDIT ENTRY CANNOT BE TREATE D TO BE INCOME OF THE FIRM FOR THE PURPOSE OF INCOME-TAX. THE ASSESSEE, THEREFORE, SUBMITTED THAT THE AFFIDAVITS AS WELL AS CONFIRMATIONS OF THE PERSONS WERE FILED BEFORE THE AO AND THEREFORE, THE STATEMENTS WERE ALSO RECORDED BY THE AO IN WHICH THEY HAVE CONFIRMED GIVING OF ADVANCE TO THE ASSESSEE. THEREF ORE, NO ADDITION IS CALLED FOR. 4. THE LD. CIT(A) DID NOT ACCEPT THE CONTENTION OF THE ASSESSEE AND NOTED THAT THE FACTS NARRATED IN THE AFFIDAVITS AND STATE MENTS OF THESE FOUR PERSONS SEEMS TO BE UNREALISTIC. THEREFORE, THE APPEAL OF T HE ASSESSEE WAS DISMISSED. ITA NO.312/AGRA/2013 5 5. WE HAVE HEARD THE LD. REPRESENTATIVES OF BOTH TH E PARTIES AND PERUSED THE MATERIAL AVAILABLE ON RECORD. IN THIS CASE, THE ASSESSEE MADE TWO DEPOSITS OF RS.8,50,000/- AND RS.9,00,000/- IN HIS BANK ACCO UNT ON 09.06.2008. THE ASSESSEE ALSO FILED COPY OF BANK STATEMENT TO SHOW THAT ON THE SAME DAY ON 09.06.2008, AFORESAID SUM WAS WITHDRAWN IN TWO INST ALLMENTS OF RS.9,00,000/- AND RS.8,50,000/-. THE ASSESSEE EXPLA INED THAT HE HAS ENTERED INTO AN AGREEMENT TO SALE IN RESPECT OF TWO OF HIS FAMILY PROPERTIES WITH THE CONSENT OF HIS FAMILY MEMBERS AND ADVANCES HAVE BEE N RECEIVED AGAINST THE SALE OF PROPERTY FROM FOUR PERSONS NAMELY, SHRI AJM ER SINGH, SH. NARAYAN SINGH, SH. MATADEEN AND SHRI SHIVRAJAN SHARMA. THE ASSESSEE FILED THEIR CONFIRMATION BEFORE THE AO AS WELL AS THEIR AFFIDAV ITS AFFIRMING GIVING OF ADVANCES AGAINST THE PROPERTIES TO THE ASSESSEE. TH E ASSESSEE ALSO PRODUCED ALL THE FOUR PURCHASERS ABOVE BEFORE THE AO AND STA TEMENT ON OATH WERE RECORDED IN WHICH THEY HAVE AFFIRMED THE CONTENTS O F THE AFFIDAVITS FILED BY THEM AS WELL AS THE TRANSACTION WITH THE ASSESSEE A ND AGREEMENT ENTERED INTO BETWEEN THEM. IT IS ALSO EXPLAINED THAT SINCE THE D EAL DID NOT MATERIALIZE, THEREFORE, ON THE SAME DAY, THE DEAL WAS CANCELLED AND THE AMOUNTS WERE REFUNDED TO THEM ON THE SAME DAY. THE BANK STATEMEN T SUPPORT THE CLAIM OF ASSESSEE THAT SAME AMOUNT HAS BEEN WITHDRAWN ON THE SAME DAY. THEREFORE, ITA NO.312/AGRA/2013 6 CONFIRMATIONS/AFFIDAVITS OF THE PURCHASERS SUPPORTE D BY THE STATEMENT ON OATH RECORDED BY THE AO CLEARLY PROVE THAT THE ASSE SSEE PROVED THE IDENTITY OF THE PURCHASERS, THEIR CREDITWORTHINESS AND GENUINEN ESS OF THE TRANSACTION IN THE MATTER. ALL THESE PERSONS IN THEIR STATEMENT EX PLAINED THEIR SOURCE OF INCOME AS WELL. THEREFORE, THE CASE OF THE ASSESSEE IS SQUARELY COVERED BY THE JUDGMENT OF JURISDICTIONAL M.P. HIGH COURT IN THE C ASE OF METACHEM INDUSTRIES (SUPRA). IT IS NOT THE CASE OF ORDINARY CASH CREDIT RECEIVED BY THE ASSESSEE. THE ASSESSEE HAS RECEIVED ADVANCE AGAINST PROPERTY, THE REFORE, IT IS NOT FOR THE ASSESSEE TO SEE FROM WHERE THE PURCHASERS HAVE BROU GHT THE MONEY. SINCE THE DEAL WAS NOT MATERIALIZED AND ON THE SAME DAY THE D EAL WAS CANCELLED AND THE AMOUNT WAS REFUNDED, THEREFORE, THE INITIAL BURDEN ON THE ASSESSEE HAD BEEN DISCHARGED TO PROVE THE GENUINENESS OF THE TRANSACT ION IN THE MATTER. THE ASSESSEE HAS EXPLAINED ALL THE OBJECTIONS OF THE AO IN HIS EXPLANATION. THE LD. CIT(A) WITHOUT GIVING ANY COGENT REASONS REJECTED T HE EXPLANATION OF THE ASSESSEE WITHOUT ANY JUSTIFICATION. THE LD. CIT(A) REJECTED THE EXPLANATION OF THE ASSESSEE BECAUSE THE STATEMENT OF ALL THE ABOVE FOUR PERSONS WERE UNREALISTIC. THIS ITSELF IS NO GROUND TO DISBELIEVE THE STATEMENT OF THE PURCHASERS BECAUSE THE AO HAS NOT BROUGHT ANY EVIDE NCE ON RECORD AGAINST THE STATEMENT OF FOUR PURCHASERS TO PROVE THE CASE OF THE REVENUE. IT IS WELL SETTLED LAW THAT THE INCOME TAX AUTHORITIES SHALL H AVE TO CONSIDER THE EVIDENCE ITA NO.312/AGRA/2013 7 AND MATERIAL ON RECORD BY APPLYING THE TEST OF HUMA N PROBABILITIES AND AFTER CONSIDERING THE SURROUNDING CIRCUMSTANCES. WE RELY UPON THE DECISION OF HONBLE SUPREME COURT IN THE CASE OF DURGA PRASAD M ORE, 82 ITR 540 AND SUMATI DAYAL, 214 ITR 801. CONSIDERING THE TOTALITY OF FACTS AND CIRCUMSTANCES AND MATERIAL ON RECORD, WE ARE OF THE VIEW THAT THE AUTHORITIES BELOW WITHOUT ANY JUSTIFICATION HAVE MADE THE ADDITION AGAINST TH E ASSESSEE. THE EXPLANATION OF THE ASSESSEE IS ACCEPTABLE AND AS SUCH NO ADDITI ON IS CALLED FOR IN THE MATTER. WE ACCORDINGLY SET ASIDE THE ORDERS OF THE AUTHORIT IES BELOW AD DELETE THE ADDITION OF RS.17,50,000/-. 6. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED. ORDER PRONOUNCED IN THE OPEN COURT. SD/- SD/- (ANNAPURNA MEHROTRA) (BHAVNESH SAINI) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED :10.02.16 *AKS/- COPY OF ORDER FORWARDED TO: (1) THE APPELLANT (2) THE RESPONDENT (3) COMMISSIONER (4) CIT(A) (5) DEPARTMENTAL REPRESENTATIVE (6) GUARD FILE BY ORDER ASSISTANT REGISTRAR