Anupama Bhateja, Chandigarh V. DY Commissioner Of Income Tax, Chandigarh

ITA 351/CHANDI/2016

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 9154 (ITAT-CHANDIGARH)
• Duration Of Justice: 3 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-08-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: Not Allotted
• Assessment Year: 2010-2011
• Appeal Filed On: 11-04-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S K MITTAL
• Keywords: Opportunity of being heard

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH, CHANDIGARH BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER ITA NO. 351/CHD/2016 (ASSESSMENT YEAR : 2010-11) ANUPAMA BHATEJA, VS. THE D.C.I.T., H.NO. 1332, SECTOR 18C, CIRCLE 2(1), CHANDIGARH. CHANDIGARH. PAN: AEBPD4901J (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI PARIKSHIT AGGARWAL RESPONDENT BY : SHRI S.K. MITTAL, DR DATE OF HEARING : 03.08.2016 DATE OF PRONOUNCEMENT : 09.08.2016 O R D E R THIS APPEAL BY THE ASSESSEE HAS BEEN DIRECTED AGAINST THE ORDER OF LEARNED COMMISSIONER OF INCOME TAX (APPEALS)-1, CHANDIGARH DATED 29.2.2016 FOR ASSESSM ENT YEAR 2010-11, CHALLENGING THE ADDITION OF RS.10,50, 356/- ON ACCOUNT OF UNEXPLAINED CASH UTILIZED BY THE ASSESSE E. 2. THE BRIEF FACTS OF THE CASE ARE THAT DURING TH E COURSE OF ASSESSMENT PROCEEDINGS, ON EXAMINATION OF THE BANK ACCOUNT OF THE ASSESSEE WITH VIJAY BANK, SECTO R 17, CHANDIGARH, THE ASSESSING OFFICER CONCLUDED THAT TH E CASH DEPOSITS TO THE EXTENT OF RS.10,50,356/- ARE UNEXPL AINED AND ADDED TO THE INCOME OF THE ASSESSEE. THE LEARN ED CIT (APPEALS) REPRODUCED THE PORTION OF THE ASSESSMENT ORDER IN 2 THE IMPUGNED ORDER, IN WHICH THE ASSESSING OFFICER AFTER EXAMINING THE DETAILS NOTED THAT THERE WERE SUBSTAN TIAL CASH DEPOSITS APPEARING IN THE BANK ACCOUNT OF THE ASSESSEE. THE ASSESSEE PRODUCED CASH FLOW CHART TO EXPLAIN THE CASH DEPOSITS, WHICH IS NOTED AT PAGE 7 OF THE IMPUGNED ORDER. THE ASSESSING OFFICER ON EXAMINATION OF THE DETAILS FOUND THAT IN THE CASH FLOW, THE ASSESSEE HAS SHOWN PAYMENT MADE TO HUDA AT RS.14,61,000/-, WHEREAS AS PER THE CERTIFICATE OF PAYMENTS TO HUDA, IT WAS LESSER AMOUNT. THE ASSESSING OFFICER ALSO PERUSED SALE DEED IN RES PECT OF PLOT NO.130, SECTOR 25, PANCHKULA AND NOTED THAT A S PER THE SALE DEED DATED 2.3.2010, THE SALE CONSIDERATIO N IS PAID THROUGH CHEQUE DATED 26.2.2010 AND RS.23,80,000 HAS BEEN PAID IN CASH. THE ASSESSING OFFICER, THEREFORE, N OTED THAT THE ABOVE CASH OF RS.23,80,000/- HAS BEEN RECEIVED BY THE ASSESSEE ON 2.3.2010. THEREFORE, THE CASH DEPOSITS AFTER 2.3.2010 CAN BE EXPLAINED THROUGH THIS CASH AVAILAB LE WITH THE ASSESSEE FROM THE SALE OF PLOT. THE ASSESSING OFFICER CONSIDERED THE ISSUE IN DETAIL WITH REGARD TO PAYME NT TO HUDA AND AVAILABILITY OF THE CASH WITH THE ASSESSEE AND BANK DEPOSITS AND ULTIMATELY HELD THAT THE ASSESSEE IS ABLE TO EXPLAIN THE CASH OF RS.2,50,644/- AND ACCORDINGL Y, MADE ADDITION OF RS.10,50,356/- ON ACCOUNT OF UNEXPLAINE D CASH CREDITS. 3. THE ASSESSEE CHALLENGED THE ADDITION BEFORE THE LEARNED CIT (APPEALS) AND HIS WRITTEN SUBMISSION IS REPRODUCED IN THE IMPUGNED ORDER, IN WHICH THE ASSE SSEE 3 BRIEFLY EXPLAINED THAT THE ASSESSEE SOLD RESIDENTIA L PROPERTY FOR A CONSIDERATION OF RS.52.80 LACS, OUT OF WHICH RS.29 LACS WERE RECEIVED THROUGH CHEQUE AND RS.23.80 LACS WERE RECEIVED THROUGH CASH. THE SALE DEED IS SILENT ABO UT THE DATE OF MAKING OF CASH PAYMENT BY THE PURCHASER. T HE ASSESSING OFFICER ADOPTED THE DATE OF RECEIPT OF CA SH ON THE DATE OF EXECUTION OF THE SALE DEED ON 2.3.2010. T HE PROPERTY WHICH WAS SOLD WAS A PARTLY PAID PROPERTY OF HUDA ON WHICH DUES WERE OUTSTANDING, WHICH WERE TO BE PA ID TO HUDA. THE ASSESSEE AGREED TO SELL THIS PROPERTY T O THE PURCHASER BUT IT WAS AGREED BETWEEN THE PARTIES THA T ALL DUES TO HUDA WOULD BE CLEARED BY THE ASSESSEE. THE PURCHASER PAID THE TOKEN MONEY IN CASH AND FROM THI S CASH THE ASSESSEE PAID THE OUTSTANDING DUES TO HUDA. TH E TOTAL AGGREGATE AMOUNT OF RS.14,61,000/- WAS PAID DURING THE PERIOD 4.1.2010 TO 2.2.2010 AND FINALLY SALE DEED W AS EXECUTED ON 2.3.2010. THE ASSESSING OFFICER MADE T HE ADDITION ON MERE PRESUMPTION, THEREFORE, ADDITION M AY BE DELETED. THE LEARNED CIT (APPEALS) DID NOT ACCEPT THE CONTENTION OF THE ASSESSEE AND CONFIRMED THE ADDITI ON. HIS FINDING IN PARA 9.2 OF HIS ORDER IS REPRODUCED AS U NDER : 9.2 I HAVE CONSIDERED THE SUBMISSION OF THE APPEL LANT AND THE ELABORATE ANALYSIS OF THE FACTS IN THE ASSESSME NT ORDER. THE DETAILED ANALYSIS OF THE BANK STATEMENT WITH RE SPECT TO THE CASH FLOW GIVEN BY THE APPELLANT LEAVES NO AMBIGUIT Y THAT THE APPELLANT WAS UNABLE TO EXPLAIN THE CASH DEPOSITS O F RS.10,53,356/- FROM THE CASH AVAILABLE TO HER. THE GENERAL PRACTICE IN THE REAL ESTATE MARKET IS THAT FOR A SA LE OF A 4 PROPERTY A SALE AGREEMENT IS PREPARED BY PAYING A T OKEN AMOUNT, AS AGREED BETWEEN THE BUYER AND SELLER, IN CHEQUE. THE AMOUNT OF SUCH PAYMENT IN CHEQUE IS MENTIONED I N THE SALE AGREEMENT WHERE A CONDITION IS IMPOSED THAT TH E SALE AGREEMENT IS VALID FOR A LIMITED PERIOD OF 3-6 MONT HS AND AFTER THAT IT WOULD NOT SURVIVE AND THE AMOUNT OF T OKEN WILL BE FORFEITED. IT IS NOT A PRACTICE THAT CASH BAYANA IS PAID TO THE SELLER IN ADVANCE. IN THE CASE OF GETTING THE PROPE RTY DOCUMENTS RELEASED FROM THE BANK (IF MORTGAGED TO B ANK AGAINST A LOAN) THE SELLER INSISTS FOR A CHEQUE PAYMENT SO THAT THE AMOUNT IN CHEQUE IS UTILIZED TO REPAY THE LOAN OF THE BANK. WHATEVER REMAINING AMOUNT TO BE PAID IN C ASH, IT IS ALWAYS PAID AT THE TIME OF REGISTRATION OF THE S ALE DEED ALONGWITH ANY REMAINING AMOUNT TO BE PAID IN CHEQUE . IN VIEW OF THE ABOVE DISCUSSION, 1 DO NOT SUBSCRIBE TO THE SUBMISSION OF THE APPELLANT THAT THE DATE OF RECEIP T OF CASH BAYANA MAY BE TREATED IN THE MONTH OF JANUARY, 2010 . THE ASSESSING OFFICER HAS RIGHTLY TAKEN THE DATE OF REC EIPT OF CASH BAYANA ON THE DATE OF SALE DEED I.E. 02.03,2010 AND ANALYSED THE FACTS CORRECTLY TO ARRIVE UPON THE CONCLUSION THAT THE APPELLANT HAD FAILED TO EXPLAIN THE CASH DEPOSITS TO THE EXTENT OF RS.10,53,356/-. IN V IEW OF THE ABOVE, THE ADDITION OF RS.10,53,356/- IS CONFIR MED. GROUND OF APPEAL NO, 4 IS DISMISSED. 4. AFTER CONSIDERING THE RIVAL SUBMISSIONS, I AM OF THE VIEW THAT THE MATTER REQUIRES RECONSIDERATION A T THE LEVEL OF THE ASSESSING OFFICER. THE ASSESSEES COU NSEL TRIED TO EXPLAIN THAT THE ASSESSEE SOLD THE PROPERTY TO T HE PURCHASER SMT.REKHA JANGRA, ON WHICH THERE WERE DU ES OF HUDA. THE ASSESSEE CLEARED THE DUES OF HUDA THROUG H THE 5 AMOUNT RECEIVED FROM THE PURCHASER. THE DETAILS OF SAME ARE NOTED AT PAGE 14 OF THE PAPER BOOK, IN WHICH TH E ASSESSEE MADE PAYMENT TO HUDA IN A SUM OF RS.14,33, 000/- WHICH IS SUPPORTED BY RECEIPTS. THE LEARNED COUNSE L FOR THE ASSESSEE POINTED OUT THAT ON ALL THE RECEIPTS ISSUE D BY HUDA, THERE IS SIGNATURE OF THE BROKER, SHRI SANJEE V CHAUHAN. HE HAS REFERRED TO THE STATEMENT OF PAYME NT DEPOSITED WITH HUDA IN WHICH TWO THE PAYMENTS OF RS.3,50,000/- AND RS.5 LACS ARE STATED TO HAVE BEEN PAID BY THE BROKER SHRI SANJEEV CHAUHAN THROUGH HIS BANK AC COUNT. THE BANK STATEMENT OF SHRI ABHISHEK INTERNATIONAL, PROP. SANJEEV CHAUHAN IS FILED IN RESPECT OF THE SAME SUP PORTED BY AFFIDAVIT OF SHRI SANJEEV CHAUHAN, IN WHICH HE H AS CLARIFIED THAT THESE TWO DRAFTS WERE PREPARED FROM PUNJAB NATIONAL BANK AND THESE DRAFTS WERE DIRECTLY PAID T O HUDA TOWARDS CLEARANCE OF OUTSTANDING DUES ON BEHALF OF THE ASSESSEE (SELLER). IT IS ALSO SUBMITTED IN THE AFF IDAVIT THAT THE PURCHASER MADE THE PAYMENT DIRECTLY TO THE SELL ER IN HIS PRESENCE IN CASH ON 2.1.2010 IN A SUM OF RS.15 LACS . THE LEARNED COUNSEL FOR THE ASSESSEE, HOWEVER, ADMITTED THAT THE COPY OF THE BANK STATEMENT OF SHRI SANJEEV CHAUHAN AND HIS AFFIDAVIT WERE NEVER FILED BEFORE THE AUTHORITIES B ELOW. THEREFORE, THE AUTHORITIES BELOW WERE NOT HAVING AN Y OCCASION TO EXAMINE THESE EVIDENCES. HOWEVER, FACT REMAINED THAT AS PER DETAILS SUBMITTED IN THE PAPER BOOK, TWO PAYMENTS OF RS.3,50,000/- AND RS.5 LACS WERE PA ID TO HUDA ON BEHALF OF THE ASSESSEE THROUGH DEMAND DRAFTS. THIS SHOULD HAVE BEEN CLARIFIED BY THE ASSES SEE AT 6 ASSESSMENT STAGE IN ORDER TO FIND OUT THE TRUTH IN THE MATTER AND SOURCE OF THE ISSUE OF THE DRAFTS FOR MA KING THE PAYMENT TO HUDA. FURTHER IN THE SALE DEED DATED 2. 3.2010, IT IS MENTIONED THAT THE SELLER HAS PAID RS.23,80,0 00/- IN CASH AND IT IS ALSO STATED THAT NOTHING IS TO BE PA ID BEFORE THE SUB REGISTRAR, PANCHKULA AT THE TIME OF REGISTR ATION OF THE SALE DEED. IT WOULD, THEREFORE, SHOW THAT THE CASH AMOUNT WAS PAID BY THE PURCHASER TO THE SELLER (ASS ESSEE) PRIOR TO THE REGISTRATION OF THE SALE DEED. THEREF ORE, THERE WAS NO REASON FOR THE AUTHORITIES BELOW TO PRESUME THAT THE CASH IS ALWAYS PAID AT THE TIME OF REGISTRATION OF THE SALE DEED. THE EXPLANATION OF LEARNED COUNSEL FOR THE A SSESSEE IS, THEREFORE, ACCEPTABLE THAT SOME CASH WOULD HAVE RECEIVED BY THE ASSESSEE FROM THE PURCHASER PRIOR TO REGISTR ATION OF THE SALE DEED. HOWEVER, THIS FACT NEEDS EXAMINATIO N AT THE LEVEL OF THE ASSESSING OFFICER INCLUDING THE DRAFTS PREPARED BY SHRI SANJEEV CHAUHAN ON BEHALF OF THE PURCHASER FOR MAKING THE PAYMENT TO THE HUDA. IN MY VIEW, THE IN TEREST OF JUSTICE REQUIRES THAT THE MATTER BE REINVESTIGAT ED BY THE ASSESSING OFFICER FOR DOING SUBSTANTIAL JUSTICE BET WEEN THE PARTIES. THE MATTER REQUIRES RECONSIDERATION AT TH E LEVEL OF THE ASSESSING OFFICER. 5. IN THIS VIEW OF THE MATTER, I SET ASIDE THE ORD ER OF THE AUTHORITIES BELOW AND RESTORE THE MATTER IN ISS UE TO THE FILE OF THE ASSESSING OFFICER WITH DIRECTIONS TO RE DECIDE THE ISSUE IN ACCORDANCE WITH LAW BY GIVING REASONABLE S UFFICIENT OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. THE AS SESSEE IS 7 DIRECTED TO PRODUCE SMT.REKHA JANGRA, PURCHASER OF THE PROPERTY AND SHRI SANJEEV CHAUHAN, BROKER BEFORE TH E ASSESSING OFFICER FOR THEIR EXAMINATION ON OATH IN ORDER TO FIND OUT THE TRUTH IN THE MATTER. THE ASSESSEE IS ALSO DIRECTED TO FILE COPY OF THE AFFIDAVIT OF SHRI SANJ EEV CHAUHAN AND COPY OF THE BANK ACCOUNT BEFORE THE ASSESSING O FFICER FOR HIS CONSIDERATION. THE ASSESSING OFFICER THERE AFTER SHALL DECIDE THE CASE IN ACCORDANCE WITH LAW AFTER EXAMIN ING THE MATERIAL ON RECORD AFRESH. WITH THESE DIRECTIONS, THE MATTER IS REMANDED TO THE ASSESSING OFFICER FOR RECONSIDER ATION. 6. IN THE RESULT, THE APPEAL OF THE ASSESSEE ALLOW ED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT. SD/- (BHAVNESH SAINI) JUDICIAL MEMBER DATED : 9 TH AUGUST, 2016 *RATI* COPY TO: THE APPELLANT/THE RESPONDENT/THE CIT(A)/TH E CIT/THE DR. ASSISTANT REGISTRAR, ITAT, CHANDIGARH 8