The Incomet-ax Officer, Abohar V. Sh. Balish Chander Makkar, Fazilka

ITA 427/ASR/2013

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 9617 (ITAT-AMRITSAR)
• Duration Of Justice: 3 year(s) 1 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-08-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 15-06-2016
• Assessment Year: 2009-2010
• Appeal Filed On: 17-06-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: BHAWANI SHANKAR
• Keywords: Unexplained investment; Additional evidence
• Section: 69

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH; AMRITSAR BEFORE SH. A.D.JAIN, JUDICIAL MEMBER AND SH. T.S. KAPOOR, ACCOUNTANT MEMBER I.T.A NO. 198(ASR)/2015 ASSESSMENT YEAR: 2009-10 SH. MANISH MAKKAR ADVOCATE S/O SH. BALISH CHANDER MAKKAR, H. NO.100, PHASE-2, CIVIL LINES, FAZILKA. PAN:AGQPM 7068J VS. ITO, WARD-2(4), ABOHAR. (APPELLANT) (RESPONDENT) I.T.A NO. 427(ASR)/2013 ASSESSMENT YEAR: 2009-10 ITO, WARD-II(4), ABOHAR. PAN:AFZPM9909A VS. SH. BALISH CHANDER MAKKAR, CIVIL LINES, PHASE-II, FAZILKA. PAN:AFZPM9909A (APPELLANT) (RESPONDENT) APPELLANT BY: SH. SUDHIR SEHGAL RESPONDENT BY: SH. BHAWANI SHANKAR (DR.) DATE OF HEARING: 15.06.2016 DATE OF PRONO UNCEMENT: 03.08.2016 ORDER PER T. S. KAPOOR (AM): THESE ARE TWO APPEALS FILED BY ASSESSEE AS WEL L AS BY REVENUE. ITA NO.198(ASR)/2015 HAS BEEN FILED BY ASSESSEE AGAINST THE ORDER OF LEARNED CIT(A), DATED 27.02.2015 WHEREAS ITA NO.427(ASR)/20 13 HAS BEEN FILED ITA NO.198 (ASR)/2015 ITA NO 427 (ASR )/2013 ASST. YEAR: 2009-10 2 BY REVENUE AGAINST THE ORDER OF LEARNED CIT(A), DAT ED 23.3.2013 FOR ASST. YEAR:2009-10. 2. SIMILAR ISSUES ARE INVOLVED IN THESE APPEALS AND THESE WERE HEARD TOGETHER AND THEREFORE, FOR THE SAKE OF CONVENIENCE A COMMON AND CONSOLIDATE ORDER IS BEING PASSED. 3. THE BRIEF FACTS OF THE CASES AS NOTED IN THE ASS ESSMENT ORDER ARE THAT SH. BALISH CHANDER MAKKAR & MANISH MAKKAR ARE RELATED TO EACH OTHER AS FATHER AND SON. DURING THE COURSE OF ASSES SMENT PROCEEDINGS IN BOTH CASES THE ASSESSING OFFICER HAD OBSERVED THAT BOTH HAD MADE DEPOSITS IN CASH IN THEIR RESPECTIVE SAVING ACCOUNT S AND THEREFORE, AFTER CONFRONTING THE SAME TO THE ASSESSEES THE ASSESSING OFFICER MADE ADDITIONS OF RS.23,80,000/- AND RS.17,76,500/- RESP ECTIVELY TO THE INCOMES OF ASSESSEE ON ACCOUNT OF DEPOSIT OF THESE AMOUNTS. THE ASSESSING OFFICER ALSO MADE ADDITIONS ON ACCOUNT OF CERTAIN UNEXPLAINED FIXED DEPOSITS TO THE TUNE OF RS.2,35,000/- IN THE CASE OF SH. BALISH MAKKAR AND RS.3,20,000/- IN THE CASE OF MANISH MAKK AR. THE ASSESSING OFFICER FURTHER MADE AN ADDITION OF RS.31,60,000/- ON ACCOUNT OF INVESTMENT MADE BY SH. BALISH CHANDER FOR THE PURCH ASE OF A COMMERCIAL PROPERTY AT SECTOR- 69, MOHALI. SH. BALI SH CHANDER HAD SUBMITTED BEFORE THE ASSESSING OFFICER THAT HE HAD ENTERED INTO AN AGREEMENT WITH SH. KRISHNA KUMAR SHARMA OF BASTI BA STI HAZORR SINGH OF FAZIKA FOR SALE OF HIS LAND MEASURING 8 KANALS A ND 7 MARLAS FOR RS.1.5 ITA NO.198 (ASR)/2015 ITA NO 427 (ASR )/2013 ASST. YEAR: 2009-10 3 CRORE OUT OF WHICH RS.73,00,000/- WAS RECEIVED BY T HE ASSESSEE AT THE TIME OF AGREEMENT ON VARIOUS DATES AS DETAILED BELO W. 15.12.2007 RS.5 LAKHS 23.05.2008 RS.25 LAKSH. 14.06.2008 RS. 43 LAKHS. THE ASSESSEE WAS REQUIRED TO FILE DOCUMENTARY EVIDE NCE REGARDING GENUINENESS OF TRANSACTION AND CREDITWORTHINESS OF SH. KRISHAN KUMAR SHARMA WITH WHOM AGREEMENT WAS MADE. THE ASSESSEE W AS ALSO REQUIRED TO FURNISH THE PARTICULARS REGARDING PURCH ASE OF LAND WHICH WAS AGREED TO BE SOLD. THE SAID SH. KRISHAN KUMAR SHARM A APPEARED BEFORE THE ASSESSING OFFICER AND ADMITTED THAT HE HAD MADE A PAYMENT OF RS.73,00,000/- AT THE TIME OF AGREEMENT AND HE HAD RAISED CERTAIN AMOUNTS FROM VARIOUS PERSONS. ON BEING ASKED TO FIL E DOCUMENTARY EVIDENCES REGARDING AMOUNTS RAISED BY HIM, THE SAID MR. KRISHAN KUMAR SHARMA STATED THAT HE HAD NO DOCUMENTARY EVIDENCE I N THIS REGARD. IN VIEW OF THE ABOVE FACTS AND CIRCUMSTANCES THE EXPLA NATION OF THE ASSESSEE REGARDING RECEIPTS OF CASH ON ACCOUNT OF A GREEMENT TO SELL WAS REJECTED AND ADDITION WAS MADE IN THE HAND OF SH. B ALISH CHANDER MAKKAR FOR UNEXPLAINED CASH DEPOSITS IN THE BANK AN D FURTHER FOR INVESTMENT IN THE PURCHASE OF SHOP AT MOHALI AND FU RTHER FOR UNEXPLAINED INVESTMENT IN THE FORM OF FIXED DEPOSIT S. 4. IN THE CASE OF SH. MANISH MAKKAR, IT WAS SUBM ITTED BEFORE ASSESSING OFFICER THAT HE HAD RECEIVED AMOUNT FROM HIS FATHER SH. BALISH CHANDER ITA NO.198 (ASR)/2015 ITA NO 427 (ASR )/2013 ASST. YEAR: 2009-10 4 MAKKAR OUT OF THE ADVANCE AMOUNT RECEIVED BY HIM FR OM AGREEMENT TO SELL HIS AGRICULTURAL LAND. THE ASSESSING OFFICER D ID NOT AGREE WITH THE CONTENTIONS OF THE ASSESSEE AND MADE THE ADDITION B Y HOLDING AS UNDER. THE CONTENTION OF THE ASSESSEE THAT THE AMOUNT WHI CH HAS BEEN DEPOSITED IN HDFC BANK WAS TAKEN FROM HIS FATHERS HUF CANNOT BE ADMITTED DUE TO THE REASON THAT THE FATHER OF THE ASSESSEE SH. BALISH CHANDER MAKKAR HUF IS AN IN COME TAX ASSESSEE VIDE PAN AAGITM7572M AND NO ADVANCE APPEARS IN THE BALANCE S HEET. FURTHER, THE LOAN OF RS. 90,000/- WHICH ACTUALLY WAS RAISED FROM THE HUF OF THE FATHER WAS RECEIVED THROUGH PAYEES ACCOUNT CHEQUE DATED 03-02-2009 AND LOAN OF RS.2,30,000/- RAISED ON 02.02.2009 WAS ALSO THROUGH BANK ACCOUNT. BOTH THE LOANS TAKEN ARE DULY REFLECTED IN THE BANK ACCOUNTS OF BOTH THE PERSONS. THE ASSESSEE HAS DEPOSITED RS.17,67,500/- IN THE HDFC BANK ACCOUNT WHICH HAS BEEN ALLEGED TO BE TAKE N FROM THE HUF OF THE FATHER, NO SUCH AMOUNT HAS BEEN WITHDRAWN FROM THE BANK ACCOUN T NO. 06472000000029 MAINTAINED WITH HDFC BANK OR ANY OTHER BANK BY THE FATHERS HUF. THEREFORE, SIMPLY STATING WITHOUT ANY DOCUMENTARY EVIDENCE THAT THE A MOUNT WAS RECEIVED FROM FATHERS HUF CANNOT BE ADMITTED. IN THIS WAY, THE ASSESSEE HAS FAILED TO P ROVE THE GENUINENESS OF THE TRANSACTION AND CREDIT WORTHINESS OF THE CREDIT ORS. THEREFORE, THE AMOUNT OF RS.17,67,500/- DEPOSITED IN BANK AND FURTHER INVEST ED IN PURCHASE OF PROPERTY IS TREATED AS UNEXPLAINED INVESTMENT U/S 69 OF THE ACT, 1961 A ND TREATED AS INCOME FOR THE YEAR UNDER CONSIDERATION. I AM SATISFIED THAT THE ASSESS EE HAS CONCEALED THE PARTICULARS OF HIS INCOME TO THE EXTENT OF RS.17,67,500/-. THEREFORE, PENALTY PROCEEDINGS U/S 271(1)(C0 OF THE I.T. ACT,1961 HAS BEEN INITIATED SEPARATELY. SIMILARLY FOR UNEXPLAINED FIXED DEPOSITS RECEIPTS, THE ASSESSING OFFICER MADE AN ADDITION OF RS.2,35,000/- & RS.3,20,000/- R ESPECTIVELY. 5. AGGRIEVED WITH THE ORDERS BOTH ASSESSEES FILED A PPEALS BEFORE LEARNED CIT(A). THE LEARNED CIT(A) IN THE CASE OF S H. BALISH CHANDER MAKKAR DELETED THE ADDITION FOR UNEXPLAINED CASH DE POSITS IN BANK AND FOR INVESTMENT IN THE SHOP WHEREAS IN THE CASE OF S H. MANISH MAKKAR THE LEARNED CIT(A) CONFIRMED THE ADDITIONS. 6. IN VIEW OF THE OF THE LEARNED CIT(A)S ORDER BO TH PARTIES ARE IN APPEAL BEFORE US. ITA NO.198 (ASR)/2015 ITA NO 427 (ASR )/2013 ASST. YEAR: 2009-10 5 7. AT THE OUTSET, THE LEARNED DR TOOK UP THE APPEAL FILED BY REVENUE AND SUBMITTED THAT LEARNED CIT(A) WITHOUT EXAMINATI ON OF THE ENTIRE FACTS AND CIRCUMSTANCES AND WITHOUT EXAMINATION OF THE AG REEMENT HAS DELETED THE ADDITION WHICH IS NOT JUSTIFIED. THE LE ARNED AR, ON THE OTHER HAND SUBMITTED THAT THOUGH ASSESSEE HAD NOT FILED A NY APPEAL IN THE CASE OF BALISH CHANDER MAKKAR, YET TO STRENGTHEN TH E CASE OF THE ASSESSEE HE HAD FILED ADDITIONAL EVIDENCES IN THE F ORM OF COPY OF AFFIDAVIT AND COPY OF CIVIL SUIT FILED AGAINST SH. KRISHAN KU MAR SHARMA HIGHLIGHTING THE NATURE OF ADDITIONAL EVIDENCES THE LEARNED AR SUBMITTED THAT THE FIRST EVIDENCE IS IN THE FORM OF COPY OF A FFIDAVIT FILED BEFORE SUB- REGISTRAR MARKING HIS PRESENCE FOR THE REGISTRATION OF LAND WHICH WAS AGREED TO BE SOLD. REGARDING SECOND EVIDENCE, IT WA S SUBMITTED THAT EVIDENCE WAS PROOF OF FILING OF A CIVIL SUIT AGAINS T SH. KRISHNA KUMAR SHARMA FOR GETTING THE SALE DEED REGISTERED. THE LE ARNED AR SUBMITTED THAT SINCE THESE EVIDENCES GO TO THE ROOT OF DECIDI NG THE CASE, THEREFORE, SAME MAY BE ADMITTED AS ADDITIONAL EVIDENCES. 8. AS REGARDS THE APPEAL FILED BY ASSESSEE IN THE C ASE OF SH. MANISH MAKKAR, THE LEARNED AR SUBMITTED THAT IN VIEW OF TH E FACTS THAT ASSESSEE HAD RECEIVED AMOUNT FROM HIS FATHER WHO HAD RECEIVE D CASH AGAINST AGREEMENT FOR SALE OF LAND, THE ACTION OF LEARNED C IT(A) IN NOT ACCEPTING THE EXPLANATION OF ASSESSEE WAS NOT CORRECT. HE SUB MITTED THAT SH. KRISHNA KUMAR IN THE STATEMENT BEFORE ASSESSING OFF ICER HAD ALREADY ITA NO.198 (ASR)/2015 ITA NO 427 (ASR )/2013 ASST. YEAR: 2009-10 6 ADMITTED THAT OUT OF RS. 73 LACS THE AMOUNT IN CASH WAS PAID ON 23.05.2008 TO THE TUNE OF RS.25 LACS AND ON 14.06.2 008 THE CASH WAS PAID AMOUNTING TO RS.43 LACS. 9. THE LEARNED DR, ON THE OTHER HAND, HEAVILY PLACE D HIS RELIANCE ON THE ORDERS OF AUTHORITIES BELOW AND DID NOT OBJECT TO THE ADMISSION OF ADDITIONAL EVIDENCE. 10. WE HAVE HEARD THE RIVAL PARTIES AND HAVE GONE T HROUGH THE MATERIAL PLACED ON RECORD. FIRST, WE TAKE UP THE AP PEAL FILED BY REVENUE IN THE CASE OF SH. BALISH CHANDER MAKKAR. WE FIND T HAT IT IS A FACT THAT ASSESSEE HAD ENTERED INTO AN AGREEMENT WITH SH. KRI SHAN KUMAR SHARMA FOR SALE OF A LAND VIDE AGREEMENT DATED 14.0 6.2008, A COPY OF WHICH ALONGWITH ENGLISH VERSION IS PLACED AT (PB PA GES-1 TO 5). AS PER THIS AGREEMENT SH. KRISHAN KUMAR SHARMA HAD MADE TH E FOLLOWING PAYMENTS. 15.12.2007 RS.5 LAKHS 23.05.2008 RS.25 LAKSH. 14.06.2008 RS. 43 LAKHS. THE SAID SH. KRISHAN KUMAR SHARMA HAD APPEARED BEF ORE THE ASSESSING OFFICER ALSO AND HAD ACCEPTED THESE FACTS IN THE FO RM OF STATEMENTS RECORDED BY ASSESSING OFFICER. THE ASSESSING HAD MA DE THE ADDITION HOLDING THAT SH. KIRSHAN KUMAR WAS NOT A MAN OF MEA NS AND HE HAD FURTHER BORROWED FROM OTHER PERSONS FOR WHICH PROPE R EVIDENCE WAS NOT FILED. WE FIND THAT THE LEARNED AR HAS FILED AN AFF IDAVIT OF THE ASSESSEE ITA NO.198 (ASR)/2015 ITA NO 427 (ASR )/2013 ASST. YEAR: 2009-10 7 SH. BALISH CHANDER STATING THEREIN THAT HE HAD RECE IVED THE AMOUNT OF RS.73,00,000/- AS ADVANCE AND FOR GETTING THE SALE DEEDS REGISTERED IN FAVOUR OF PURCHASER SH. KRISHAN KUMAR, HE REMAINED THERE IN THE OFFICE OF SUB-REGISTRAR BUT SH. KRISHAN KUMAR NEVER CAME F OR GETTING THE SALE DEED REGISTERED AND FOR MAKING THE BALANCE PAYMENTS . THE LEARNED AR HAS ALSO FILED A COPY OF PLAINT FILED BY ASSESSEE A GAINST SH. KRISHAN KUMAR WHEREIN ASSESSEE HAD FILED A SUIT AGAINST SH. KRISHNA KUMAR FOR RECOVERY OF THE BALANCE AMOUNT OF 77,00,000/-. THE COPY OF PLAINT AND OTHER DOCUMENTS AND THE EXISTENCE OF CIVIL SUIT FIL ED BY ASSESSEE ARE PLACED AT (PB PAGE 3 TO 10.) THEREFORE, FROM THESE FACTS AND CIRCUMSTANCES, IT IS CLEAR THAT THE AGREEMENT TO SA LE EXISTED BETWEEN ASSESSEE SH. BALISH CHANDER AND SH. KRISHAN KUMAR A ND FOR WHICH HE HAD RECEIVED RS.73 LAKHS IN TOTAL OUT OF WHICH RS.6 8 LAKHS WAS RECEIVED IN CASH. THE SAID CASH AMOUNT WAS RECEIVED BY HIM A S UNDER: 23.05.2008 RS.25 LAKSH. 14.06.2008 RS.43 LAKHS. THE ASSESSEE HAD DEPOSITED THE AMOUNT OF RS.23,80,0 00/- IN HIS SAVING BANK ON THE FOLLOWING DATES. 10.5.2008 RS.2,30,000/- 14.06.2008 RS.8,00,000/- 17.06.2008 RS.7,00,000/ 18.03.2008 RS.6,00,000/- 02.03.2009 RS.50,000/- ITA NO.198 (ASR)/2015 ITA NO 427 (ASR )/2013 ASST. YEAR: 2009-10 8 THEREFORE, THE ABOVE AMOUNTS DEPOSITED BY ASSESSEE EXCEPT THE AMOUNT OF RS.2,30,000 RECEIVED ON 10.05.2008 CAN BE DULY R ELATED TO AMOUNTS OF CASH RECEIVED BY ASSESSEE FROM SH. KRISHAN KUMAR ON 23.05.2008 AND 14.06.2008. THEREFORE, THE DEPOSITS MADE BY ASSESSE E STAND DULY EXPLAINED. SIMILARLY, WE FIND THAT ADDITION ON ACCO UNT OF INVESTMENT IN SHOP AT MOHALI WAS MADE ON 28.05.2008 TO THE TUNE O F RS.31,60,000/-. THE SAID INVESTMENT WAS ALSO CLAIMED TO HAVE BEEN M ADE OUT OF RECEIPTS RECEIVED IN VIEW OF AGREEMENT TO SELL. THE LEARNED CIT(A) HAS CLEARLY MADE A FINDING OF FACT THAT ASSESSING OFFICER WAS NOT JU STIFIED IN MAKING THE ADDITIONS IN THE HANDS OF SH. BALISH CHANDER IN VIE W OF THE EVIDENCES FILED BY HIM. THE ADDITIONAL EVIDENCES FILED BY LEA RNED AR STRENGTHS THE CASE OF ASSESSEE AND PROVES THE EXISTENCE OF AGREEM ENT AND RECEIPT OF ADVANCE AMOUNT AGAINST SALE OF LAND. THE AUTHORITIE S BELOW WERE NOT JUSTIFIED IN MAKING THE ADDITIONS IN THE HANDS OF A SSESSEE HOLDING THAT THE BUYER WAS NOT A MAN OF MEANS. THIS IS NOT A CAS E OF CASH CREDITS BUT A CASE OF ADVANCE RECEIVED AGAINST SALE OF LAND AND IN SUCH CASES THE SELLER IS NOT BOUND TO PROVE CREDIT WORTHINESS OF B UYER. THEREFORE, WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF LEARNED CIT( A). 11. AS REGARDS THE PART DELETION OF RS.85000/- OUT OF ADDITION OF RS.2,35,000/-, WE FIND THAT ASSESSEE BEING A PROFES SIONAL, THE LEARNED CIT(A) HAS RIGHTLY ALLOWED RELIEF OF RS.85,000/- 12. IN VIEW OF THE ABOVE, THE APPEAL FILED BY REVEN UE IS DISMISSED. ITA NO.198 (ASR)/2015 ITA NO 427 (ASR )/2013 ASST. YEAR: 2009-10 9 13. NOW COMING TO THE APPEAL FILED BY ASSESSEE I.E. SH. MANISH KUMAR S/O SH. BALISH CHANDER. IN THIS CASE THE ASSESSING OFFICER HAD NOTED THE FOLLOWING AMOUNTS TO HAVE BEEN DEPOSITED IN THE SAV ING BANK ACCOUNT OF ASSESSEE. RS.2,00,000/- ON 24.04.2008 RS.8,00,000/- ON 14.05.2008 RS.5,000/- ON 17.06.2008 RS.7,00,000/- ON 17.06.2008 RS.50,000/- ON 18.06.2008 RS.12,500/- ON 11.02.2009 . TOTAL RS.17,67,500/- THE ASSESSEE BEFORE THE AUTHORITIES BELOW HAD SUBMI TTED THAT HE HAD RECEIVED THE AMOUNTS FROM HIS FATHER SH. BALISH CHA NDER MAKKAR, HOWEVER, HIS CONTENTIONS WERE REJECTED BY THE AUTHO RITIES BELOW, HOLDING THAT IN THE BALANCE SHEET OF SH. BALISH CHANDER NO SUCH ENTRIES WERE REFLECTED. WE HAVE ALREADY HELD THAT SH. BALISH CHA NDER MAKKAR HAD RECEIVED A TOTAL AMOUNT OF RS.68,00,000/- IN CASH F ROM THE BUYER SH. KRISHAN KUMAR OUT OF WHICH RS.55,40,000/- WAS UTILI ZED BY HIM FOR DEPOSITS IN HIS BANK ACCOUNTS AND THE BALANCE AMOUN T WAS AVAILABLE WITH HIM FOR MAKING DEPOSITS IN THE BANK ACCOUNT OF HIS SON I.E., ASSESSEE. THIS ASPECT HAS NOT BEEN EXAMINED BY THE AUTHORITIES BELOW. THEREFORE, IN THE INTEREST OF JUSTICE WE DEEM IT AP PROPRIATE TO REMIT THIS ISSUE TO THE OFFICE OF ASSESSING OFFICER WHO SHOULD DECIDE THE SAME AFRESH IN VIEW OF THE CASH RECEIVED BY FATHER OF ASSESSEE FROM SH. KRISHAN KUMAR SHARMA AND AFTER HEARING THE ASSESSEE REGARDI NG EXPLANATION OF THE BALANCE AMOUNT DEPOSITED IN HIS BANK ACCOUNT. S IMILARLY, THE ISSUE ITA NO.198 (ASR)/2015 ITA NO 427 (ASR )/2013 ASST. YEAR: 2009-10 10 OF INVESTMENT IN FIXED DEPOSITS TO THE TUNE OF RS.3 ,20,000/-NEEDS TO BE EXAMINED AFRESH IN VIEW OF THE CASH BALANCE AVAILAB LE WITH THE FATHER OF ASSESSEE. 14. IN VIEW OF THE ABOVE GROUND NO.2 & 3 ARE ALL OWED FOR STATISTICAL PURPOSES. 15. THE LEARNED AR HAS NOT PRESSED GROUND NOS. 1 TO 4, THEREFORE, THESE ARE DISMISSED AS NOT PRESSED. 16. IN NUTSHELL, THE APPEAL FILED BY REVENUE IS DIS MISSED AND THE APPEAL FILED BY THE ASSESSEE IS PARTLY ALLOWED FOR STATISTICAL PURPOSE AND PARTLY DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 03 .08. 2016 SD/- SD/- (A.D. JAIN) (T. S. KAPOOR) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 03.08.2016. /PK/ PS. COPY OF THE ORDER FORWARDED TO: (1) THE ASSESSEE: (2) THE (3) THE CIT(A), (4) THE CIT, (5) THE SR DR, I.T.A.T., TRUE COPY BY ORDER