Sri.Joseph Thannikottu Korah, Kollam V. The ITO, Kollam

ITA 33/COCH/2017

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 3908 (ITAT-COCHIN)
• Duration Of Justice: 4 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-06-2017
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: SMC
• Next Hearing Date: 23-05-2017
• Assessment Year: 2011-2012
• Appeal Filed On: 06-02-2017
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: A DHANARAJ
• Assessee Lawyers: T M SREEDHARAN; VANDANA MENON
• Keywords: Additional evidence; Valuation report

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL COCHIN BENCH, COCHIN BEFORE GEORGE GEORGE K., JUDICIAL MEMBER I.T.A. NO. 33/COCH/2017 ASSESSMENT YEAR : 2011 - 12 JOSEPH THANNIKOTTU KORAH, THANNIKOTTU HOUSE, TITANIUM NAGAR, KAVANADU P.O., KOLLAM-691 003. [PAN:AIGPK 6285M] VS. THE INCOME TAX OFFICER, WARD-2, KOLLAM RANGE, KOLLAM. ( ASSESSEE-APPELLANT) (REVENUE - RESPOND ENT) ASSESSEE BY SHRI T.M. SREEDHARAN, SR. ADV. AND SMT. VANDANA MENON, ADV. REVENUE BY SHRI A. DHANARAJ, SR. DR DATE OF HEARING 21/06/ 201 7 DATE OF PRONOUNCEMENT 22 ND /06/ 201 7 O R D E R PER GEORGE GEORGE K.,JUDICIAL MEMBER: THIS APPEAL AT THE INSTANCE OF THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE CIT(A), TRIVANDRUM DATED 01/11/2016. THE RELEV ANT ASSESSMENT YEAR IS 2011-12. 2. THERE WAS A DELAY OF THIRTY DAYS IN FILING THI S APPEAL. THE ASSESSEE HAS FILED A PETITION FOR CONDONING THE DELAY IN FILING THE AP PEAL. THE LD. DR PRESENT WAS I.T.A.NO.33/COCH/2017 2 DULY HEARD. I HAVE PERUSED THE CONDONATION PETITIO N FILED BY THE ASSESSEE. THERE IS SUFFICIENT REASON FOR DELAY IN FILING THE APPEAL. THE DELAY CANNOT BE ATTRIBUTED TO ANY LATCHES ON THE PART OF THE ASSESS EE FOR FILING THE APPEAL BELATEDLY, HENCE, I CONDONE THE DELAY IN FILING THE APPEAL AND PROCEED TO DISPOSE OF THE CASE ON MERITS. 3. THE SOLITARY ISSUE THAT ARISES FOR MY CONSIDER ATION IS WHETHER THE CIT(A) IS JUSTIFIED IN CONFIRMING THE ASSESSMENT ORDER, WHERE IN AN ADDITION OF RS.30 LAKHS WAS MADE TO THE RETURNED INCOME. 4. THE BRIEF FACTS IN RELATION TO THE ISSUE ARE A S FOLLOWS: THE ASSESSEE IS AN INDIVIDUAL, WHO IS EMPLOYE D WITH KMML LTD., CHAVARA, KOLLAM. FOR THE ASSESSMENT YEAR 2011-12, THE RETUR N OF INCOME WAS FILED, DISCLOSING INCOME OF RS.5,77,610/-. THE ASSESSMENT WAS TAKEN UP FOR SCRUTINY BY ISSUANCE OF NOTICE U/S. 143(2) OF THE I.T. ACT. IN THE COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSEE WAS ASKED TO EXPLAIN THE SOURCE OF CASH DEPOSITS OF RS. 30 LAKHS MADE IN ASSESSEES BANK ACCOUNT WITH I CICI BANK, KOLLAM BRANCH ON 20/01/2011. THE ASSESSEE SUBMITTED THAT THE SUM RE PRESENTED SALE PROCEEDS OF LAND BELONGING TO HIS WIFE SMT. SALY JOSEPH. THE A SSESSEE HAD PRODUCED A COPY OF THE SALE DEED DT 20/01/2011, WHEREIN IT WAS NARR ATED THAT SMT. SALY JOSEPH HAD TRANSFERRED 76.73 ARES OF LAND TO SHRI SAJEEV M ATHAI FOR A TOTAL CONSIDERATION OF RS.3,35,700/-. THE ASSESSEE SUBMITTED THAT EVEN THOUGH THE DOCUMENTED I.T.A.NO.33/COCH/2017 3 VALUE IS ONLY RS.3,35,700/-, THE ACTUAL CONSIDERATI ON WAS FOR RS.31 LAKHS, INCLUDING ADVANCE OF RS. ONE LAKH. IT WAS STATED T HAT ON EXECUTING THE SALE DEED ASSESSEES WIFE RECEIVED BALANCE OF RS. 30 LAKHS WH ICH WAS DEPOSITED IN ASSESSEES ICICI BANK ACCOUNT ON THE SAME DAY. A SWORN STATEMENT WAS RECORDED FROM THE ASSESSEE ON 16/01/2014. THE ASSE SSEE REITERATED IN THE SWORN STATEMENT WHAT WAS STATED EARLIER. THE ASSES SING OFFICER HOWEVER REJECTED THE SUBMISSIONS MADE BY THE ASSESSEE AND B ROUGHT TO TAX A SUM OF RS.30 LAKHS. THE RELEVANT OBSERVATION OF THE ASSESS ING OFFICER IN MAKING THE ADDITION OF RS.30 LAKHS READS AS FOLLOWS: THE ASSESSEE HAS PRODUCED A COPY OF THE SALE DOCUM ENT EVIDENCING THAT HIS WIFE SMT. SALY JOSEPH HAD TRANSFERRED 76.7 3 ARES OF LAND TO SRI SAJIV MATHAI. HOWEVER, THE TOTAL CONSIDERATION AS NARRATED IN THE DOCUMENT IS ONLY RS.335,700/-. THE ASSESSEE HAS NO T PRODUCED ANY EVIDENCE TO PROVE THAT THE CASH CREDIT OF RS.30 LAK HS SEEN IN THE ASSESSEES BANK ACCOUNT ON 20/01/2011 REPRESENTED T HE SALE CONSIDERATION OF THE ABOVE LAND. FURTHER, THE SALE CONSIDERATION AS NARRATED IN THE ABOVE DOCUMENT IS ONLY 335,700/-. THUS, THE ASSESSEE HAS NOT PRODUCED ANY CREDIBLE EVIDENCE WHI CH WOULD LINK THE CASH CREDIT IN HIS BANK ACCOUNT WITH THE SALE OF LA ND BELONGING TO HIS WIFE. THIS HAS BEEN ADMITTED BY THE ASSESSEE IN TH E STATEMENT RECORDED ON 16/01/2014. THE ONLY SHRED OF EVIDENCE LINKING THE SALE OF LAND AND THE AMOUNT OF CREDIT IS THE DATE OF TRA NSACTION BEING 20/01/2011. BUT NO EVIDENCE OF ANY SORT LIKE AN AG REEMENT OF SALE HAS BEEN PRODUCED BY THE ASSESSEE TO SUBSTANTIATE H IS SUBMISSION REGARDING THE ACTUAL SALE OF CONSIDERATION. FURTHE R, THE ASSESSEE HAS CONTRADICTED HIS CLAIM IN HIS STATEMENT THAT HE HAD RECEIVED THE ALLEGED CONSIDERATION OF RS.30 LAKHS IN ONE INSTALM ENT WITH ANOTHER SUBMISSION IN THE SAME STATEMENT THAT HE HAD RECEIV ED RS. 1 LAKH AS ADVANCE. IN LIGHT OF THE ABOVE DISCUSSION, I HOLD THAT THE ASSESSEE HAS NOT DISCHARGED IN ANY WAY THE BURDEN CAST UPON HIM TO EXPLAIN SATISFACTORILY THE SOURCE OF THE CASH CREDIT IN HIS BANK ACCOUNT OF RS.30 LAKHS ON 20/01/2011. THE ABOVE AMOUNT IS INCL UDED IN THE TOTAL INCOME OF THE ASSESSEE. I.T.A.NO.33/COCH/2017 4 5. AGGRIEVED BY THE ADDITION OF RS.30 LAKHS, THE ASSESSEE PREFERRED AN APPEAL BEFORE THE FIRST APPELLATE AUTHORITY. BEFORE THE C IT(A), IT WAS SUBMITTED THAT THE ASSESSEES WIFE HAD MADE THE SALE TRANSACTION ON 20 /01/2011 AND ON THAT DAY ITSELF THE DEPOSIT WAS MADE IN THE ASSESSEES BANK. IT WAS STATED THAT AS THE PURCHASER HAD INSISTED ON PUTTING THE MINIMUM VALUE REQUIRED FOR STAMP DUTY PURPOSE IN THE SALE DEED, THE SELLER HAD NO OTHER O PTION OTHER THAN AGREEING TO IT FOR EFFECTING THE SALE. IT WAS SUBMITTED THAT THE OBSERVATION OF THE ASSESSING OFFICER THAT THE ASSESSEE HAD CONTRADICTED HIS CLA IM IN HIS STATEMENT THAT HE HAD RECEIVED THE ALLEGED CONSIDERATION OF RS.30 LAKHS I N ONE INSTALMENT WITH ANOTHER SUBMISSION IN THE SAME STATEMENT THAT HE HAD RECEIV ED RS.1 LAKH AS ADVANCE IS NOT CORRECT. IT WAS SUBMITTED THAT THE ASSESSING OF FICER SHOULD HAVE UNDERSTOOD THAT THE TOTAL CONSIDERATION RECEIVED IS RS.31 LAKH S AND THE AMOUNT RECEIVED ON THE DATE OF REGISTRATION FROM THE BUYER IS RS.30 LA KHS AND RS. ONE LAKH FROM THE MEDIATOR AT THE TIME OF AGREEMENT, WHICH THE ASSESS EE MENTIONED AT THE TIME OF MAKING THE SWORN STATEMENT. THE CIT(A) HOWEVER RE JECTED THE CONTENTIONS RAISED BY THE ASSESSEE AND DISMISSED THE APPEAL. T HE RELEVANT FINDING OF THE CIT(A) READS AS FOLLOWS: 3. THE CRUX OF THE ISSUE IS WHAT IS THE SOURCE FOR THE CASH DEPOSIT OF RS.30 LAKHS MADE IN THE APPELLANTS BANK ACCOUNT. HAD IT BEEN FROM THE SALE CONSIDERATION RECEIVED BY HIS WIFE, IT CANNOT BE MORE THAN RS.3,35.700/- SINCE THIS IS WHAT THE ONLY AMOUNT ME NTIONED IN THE SALE DEED AS PAID TO THE APPELLANTS WIFE TOWARDS SALE C ONSIDERATION. ANOTHER ARGUMENT OF THE APPELLANT THAT THE BALANCE AMOUNT O F RS.26,64,300/- WAS I.T.A.NO.33/COCH/2017 5 RECEIVED BY THE APPELLANTS WIFE SEPARATELY AND GIV EN TO HIM TO DEPOSIT THE SAME INTO HIS BANK ACCOUNT CANNOT BE ACCEPTED UNLES S THE BUYER OF THE LAND MR. SAJIV MATHAI CONFIRM SUCH PAYMENT SEPARATE LY MADE BY HIM. IN THE ABSENCE OF NO SUCH CONFIRMATION EVER BEEN MADE BY THE BUYER, THE REASON ADDUCED BY THE APPELLANT TO EXPLAIN THE SOUR CE CAN HAVE NO EVIDENTIARY VALUE AND HENCE, BE OUT RIGHTLY REJECTE D. FURTHER, THE DATE OF CASH DEPOSIT AND THE DATE OF SALE DEED EXECUTED I.E . 20.01.2011 WOULD IN NO WAY COME TO RESCUE OF THE APPELLANT SINCE NO OTH ER CORROBORATIVE EVIDENCE TO EXPLAIN SOURCE FOR THE BALANCE AMOUNT O F RS.26,64,300/- HAS EVER BEEN BROUGHT OUT BY THE APPELLANT. IN VIEW O F ALL THE ABOVE, I FIND NO INIFIRMITY IN THE ORDER THE ASSESSING OFFICER HA S PASSED AND ACCORDINGLY, THE ADDITION MADE OF RS.30 LAKHS IS HEREBY CONFIRME D. 6. AGGRIEVED BY THE ORDER OF THE CIT(A), THE ASSE SSEE HAS FILED THE PRESENT APPEAL BEFORE TRIBUNAL. THE LD. COUNSEL FOR THE A SSESSEE, APART FROM REITERATING THE SUBMISSIONS MADE BEFORE THE INCOME TAX AUTHORIT IES, HAS FILED A PETITION FOR ADMISSION OF ADDITIONAL EVIDENCE. THE ADDITIONAL E VIDENCE NOW SOUGHT TO BE ADMITTED IS IN THE FORM OF VALUATION REPORT OF THE IMPUGNED PROPERTY SOLD BY THE ASSESSEES WIFE AND THE LETTER OF THE BANK MANAGER OF ICICI BANK, KOLLAM, STATING THAT A SUM OF RS.30 LAKHS WAS DEPOSITED IN THE KOTT ARAKKARA BRANCH OF ICICI ON 20/1/2011. 7. I HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSE D THE MATERIAL ON RECORD. THE LD. COUNSEL FOR THE ASSESSEE HAS FILED A PETITION A ND AN AFFIDAVIT OF THE ASSESSEE FOR ADMISSION OF ADDITIONAL EVIDENCE. THE ADDITION AL EVIDENCE NOW SOUGHT TO BE ADMITTED BEFORE THE TRIBUNAL IS A CERTIFICATE FROM THE VALUATION OFFICER VALUING THE PROPERTY SOLD BY THE WIFE OF THE ASSESSEE. FUR THER A LETTER OF THE MANAGER OF ICICI BANK, KOLLAM BRANCH, STATING THAT THE AMOUNT OF RS.30 LAKHS WAS DEPOSITED I.T.A.NO.33/COCH/2017 6 BY THE ASSESSEE IN ICICI KOTTARAKKARA BRANCH ON 20 -1-2011. IN THE PETITION FILED BY THE ASSESSEE, IT HAS NOT BEEN STATED WHY THE ABO VE MENTIONED ADDITIONAL EVIDENCE NOW SOUGHT TO BE ADMITTED WAS NOT FURNISHE D BEFORE THE LOWER AUTHORITIES. MOREOVER, ADDITIONAL EVIDENCE NOW FIL ED DOES NOT LINK THE SALE OF PROPERTY BY THE WIFE OF ASSESSEE WITH THAT OF CASH DEPOSIT MADE BY ASSESSEE IN HIS ICICI BANK, KOLLAM. THEREFORE, THIS ADDITIONAL EVIDENCE IS NOT VERY IMPORTANT /RELEVANT PIECE OF EVIDENCE FOR ADJUDICATING THE IS SUE ON HAND. THEREFORE, I REJECT THE PETITION FOR ADMISSION OF ADDITIONAL EVI DENCE. IT IS ORDERED ACCORDINGLY. 8. NOW COMING TO THE ISSUE ON MERITS, I NOTIC E THAT CASH DEPOSITS OF RS.30 LAKHS WAS MADE IN ASSESSEES SB ACCOUNT WITH ICICI BANK, KOLLAM BRANCH ON 20/01/2011. THE ASSESSEE SUBMITTED THAT THE CASH DE POSITS IS MADE OUT OF THE SALE PROCEEDS OF A PROPERTY SOLD BY HIS WIFE. A COP Y OF THE SALE DEED ENTERED ON 20.01.2011 BETWEEN ASSESSEES WIFE AND MR. SAJEEV M ATHAI IS PLACED ON RECORD AT PAGES 13 TO 23 OF PAPER BOOK FILED BY THE ASSESS EE. ON PERUSAL OF THE SAME, I NOTICE THAT THE SALE CONSIDERATION SHOWN IN THE SAL E DEED ENTERED BETWEEN ASSESSEES WIFE AND MR. SAJEEV MATHAI IS TO THE TUN E OF RS.3,35,700/-. THE PROPERTY WHICH WAS SOLD BY THE ASSESSEES WIFE WAS PURCHASED BY HER IN THE YEAR 2008 VIDE TWO SALE DOCUMENTS, NAMELY DOCUMENT NO. 3 57/2008 AND DOCUMENT NO. 1178/2008. ON PERUSAL OF THE PURCHASE DEEDS, I NOTICE THAT THE TOTAL CONSIDERATION PAID BY THE ASSESSEES WIFE IS ONLY T O THE TUNE OF RS. 2 LAKHS. THE PURCHASE MADE BY THE ASSESSEES WIFE IN YEAR 2008 F OR RS.2 LAKHS HAS BEEN SOLD I.T.A.NO.33/COCH/2017 7 IN THE YEAR 2011 FOR A SUM OF RS.3,35,700/-. THERE IS NO MATERIAL ON RECORD NOR ANY EVIDENCE PRODUCED BY THE ASSESSEE BEFORE THE TR IBUNAL TO SHOW THAT THE ASSESSEES WIFE HAD RECEIVED A SUM OF RS. 31 LAKHS ON THE SALE OF PROPERTY VIDE SALE DEED NO.201/2011 (SALE DEED DT 20-1-2011). IN THE ABSENCE OF ANY MATERIAL PRODUCED BY THE ASSESSEE, I HAVE NO OTHER OPTION BUT TO CONFIRM THE ADDITION OF RS.30 LAKHS MADE BY THE ASSESSING OFFIC ER. 9. HOWEVER, I NOTICE THAT THE ASSESSING OFFICER HA S NOT GIVEN CREDIT OF RS.3,35,700/- DISCLOSED IN SALE DEED AGAINST THE CA SH DEPOSITS OF RS. 30 LAKHS. AS LONG AS THE DEPARTMENT DOES NOT HAVE A CASE THAT TH E SALE PROCEEDS OF THE ASSESSEES WIFE HAS NOT BEEN DEPOSITED IN ANY OTHER BANK ACCOUNT, I AM OF THE VIEW THAT THE SUM OF RS.3,35,700/- DISCLOSED IN THE SALE DEED OF THE ASSESSEES WIFE SHOULD BE GIVEN DUE CREDIT AGAINST THE CASH DE POSITS OF RS.30 LAKHS IN ASSESSEES ICICI BANK ACCOUNT. THEREFORE, THE ASSES SEE GETS THE BENEFIT OF RS.3,35,700/- AND BALANCE OF RS. 26,64,300/- (RS.30 ,00,000 RS.3,35,700 = RS.26,64,300) IS SUSTAINED AS INCOME OF THE ASSESSE E FROM THE UNDISCLOSED SOURCE. IT IS ORDERED ACCORDINGLY. I.T.A.NO.33/COCH/2017 8 10. IN THE RESULT, THE APPEAL FILED BY THE ASSESS EE IS PARTLY ALLOWED AS INDICATED ABOVE. PRONOUNCED IN THE OPEN COURT ON 22 ND -06-2017. SD/- ( GEORGE GEORGE K.) JUDICIAL MEMBER PLACE: KOCHI DATED: 22ND JUNE, 2017 GJ COPY TO: 1. JOSEPH THANNIKOTTU KORAH, THANNIKOTTU HOUSE, TIT ANIUM NAGAR, KAVANADU P.O., KOLLAM-691 003. 2. THE INCOME TAX OFFICER, WARD-2, KOLLAM RANGE, KO LLAM. 3. THE COMMISSIONER OF INCOME-TAX(APPEALS),TRIVANDR UM. 4. THE PR. COMMISSIONER OF INCOME-TAX, TRIVANDRUM. 5. D.R., I.T.A.T., COCHIN BENCH, COCHIN. 6. GUARD FILE. BY ORDER (ASSISTANT REGISTRAR) I.T.A.T., COC HIN