Harminder Singh, Malerkotla V. ITO, Malerkotla

ITA 465/CHANDI/2016

• Counselvise Citation: [2017] 130 COUNSELVISE.COM (IT) 8344 (ITAT-CHANDIGARH)
• Duration Of Justice: 9 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-02-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: Not Allotted
• Assessment Year: 2011-2012
• Appeal Filed On: 02-05-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S K MITTAL
• Keywords: Reason to believe
• Section: 131; 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH, CHANDIGARH BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER ITA NO. 465/CHD/2016 ASSESSMENT YEAR: 2011-12 SHRI HARMINDER SINGH, VS THE ITO, S/O SHRI JORAWAR SINGH, WARD-IV(3), HOUSE NO. 1046, MALERKOTLA. DR.BATTA STREET, GURU TEG BAHADUR COLONY, MALERKOTLA-141023. PAN: ARYPS0518G (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI SUDHIR SEHGAL RESPONDENT BY : SHRI S.K.MITTAL, DR DATE OF HEARING : 08.02.2017 DATE OF PRONOUNCEMENT : 10.02.2017 O R D E R THIS APPEAL BY ASSESSEE HAS BEEN DIRECTED AGAINST THE ORDER OF LD. CIT(APPEALS)-2 LUDHIANA DATED 01.02.2016 FOR ASSESSMENT YEAR 2011-12 CHALLENGING THE ADDITION OF RS. 14,31,253/- UNDER SECTION 68 OF INC OME TAX ACT. 2. I HAVE HEARD LD. REPRESENTATIVES OF BOTH THE PAR TIES AND PERUSED THE MATERIAL AVAILABLE ON RECORD. 3. BRIEF FACTS ARE THAT THE ASSESSEE FILED ITS RETU RN OF INCOME AT INCOME OF RS. 2,41,122/- ON 18.10.2011. 2 DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE AO OBSERVED THAT THE ASSESSEE HAS MADE CASH DEPOSITS I N HIS BANK ACCOUNTS. THE ASSESSEE WAS ASKED TO GIVE PROO F OF RS. 14,31,253/- AS OPENING CASH IN HAND AS ON 01.04.2010 IN VIEW OF THE DECISION OF HON'BLE ITAT, CHANDIGARH IN THE CASE OF ITO VS GAGANDEEP BHARDWAJ ITA NO. 1355/CHD/2010 DATED 17.04.2012. IN RESPONSE THE ASSESSEE FILED HIS REPLY IN WHICH HE CONTENDED THAT THE WHOLE AMOUNT DERIVED AS A OPENING BALANCE FROM 01.04.2010 WAS AGAINST THE SALE PROCEEDS OF AGRICUL TURE LAND WITH HOUSE MEASURING ABOUT 2 BIGHAS AND 18 BIS WA SITUATED IN VILLAGE CHAKSEKHPUR KALAN, MALERKOTLA T O SMT. AMARJIT KAUR, MALERKOTLA. SMT. AMARJIT 'KADR W AS ALSO SUMMONED BY THE AO FOR RECORDING OF STATEMENT. IN HIS STATEMENT, SHE ACCEPTED THAT SHE HAD GIVEN RS. 11,00,000/- WHICH WAS BORROWED LOAN FROM VARIOUS PERSONS INCLUDING BROTHER. 3(I) THE AO FURTHER OBSERVED THAT AS PER SALE DEE D DATED 09.06.2011 ALL THE SALE AMOUNT OF RS. 17,50,0 00/- HAD BEEN RECEIVED AT THE TIME OF REGISTRATION AND N OTHING HAD BEEN RECEIVED IN ADVANCE. THEREFORE, THE AO WAS NOT SATISFIED WITH THE ASSESSEES CONTENTION AS THE ASS ESSEE HAD NOT GIVEN ANY CREDIBLE EVIDENCE OF HAVING OPENI NG CASH IN HAND OF RS. 14,31,253/- AND IT IS DUTY OF T HE ASSESSEE TO GIVE THE COGENT AND COLLABORATIVE EVIDE NCE OF SOURCE OF OPENING CASH IN HAND AS SHOWN IN HIS BALA NCE SHEET. HENCE, THE ASSESSING OFFICER MADE AN ADDITI ON OF 3 RS. 14,31,253/- UNDER SECTION 68 OF THE INCOME TAX ACT,1961. THE ASSESSING OFFICER PLACED THE RELIANC E OF THE JUDGEMENT OF HON'BLE ITAT IN THE CASE OF ITO VS GAGANDEEP BHARDWAJ ITA NO. 1355/CHD/2010 DATED 17.04.2012. 4. THE ASSESSEE CHALLENGED THE ADDITION BEFORE LD. CIT(APPEALS) AND FILED WRITTEN SUBMISSION WHICH IS REPRODUCED IN THE IMPUGNED ORDER IN WHICH THE ASSES SEE REITERATED THE SAME FACTS THAT ADVANCE WAS RECEIVED AGAINST SALE OF PROPERTY FROM SMT. AMARJIT KAUR ON 08.03.2010 WHICH WAS OPENING BALANCE IN ASSESSMENT YEAR UNDER APPEAL. THE ASSESSEE HAS FILED HER AFFI DAVIT AS WELL AS HER STATEMENT WAS RECORDED IN WHICH SHE HAS CONFIRMED GIVING ADVANCE TO THE ASSESSEE. THE ASSE SSEE HAS ALSO SUFFICIENCY OF CASH WITHDRAWALS FROM OTHER BANK ACCOUNTS THEREFORE, ADDITION IS WHOLLY UNJUSTIFIED. 5. THE LD. CIT(APPEALS), HOWEVER, DISMISSED THE APP EAL OF THE ASSESSEE HOLDING THAT ASSESSEE FAILED TO PRO VE THE SOURCE OF THE OPENING BALANCE ON 01.04.2010. 6. AFTER CONSIDERING RIVAL SUBMISSIONS, I AM OF THE VIEW ADDITION IS WHOLLY UNJUSTIFIED. SMT. AMARJIT KAUR FILED HER AFFIDAVIT EXPLAINING THAT SHE ENTERED INTO AN AGREEMENT DATED 08.03.2010 FOR PURCHASE OF IMPUGNED PROPERTY FROM THE ASSESSEE FOR A TOTAL CONSIDERATIO N OF RS. 17,50,000/- AND OUT OF THE SAID SALE CONSIDERAT ION, 4 SHE HAS PAID RS. 11 LACS AS ADVANCE TO THE ASSESSEE ON 08.03.2010. SHE WAS EXAMINED UNDER SECTION 131 OF THE ACT BY THE ASSESSING OFFICER IN WHICH SHE HAS CONFI RMED THE SAME FACTS BEFORE THE ASSESSING OFFICER BY GIVI NG ADVANCE TO THE ASSESSEE. THE AUTHORITIES BELOW DISBELIEVED THE EXPLANATION OF THE ASSESSEE BECAUSE IN THE SALE DEED, THE AMOUNT OF TOTAL SALE CONSIDERATI ON WAS FOUND MENTIONED TO HAVE BEEN RECEIVED AT THE TIME O F REGISTRY. IT IS WELL KNOWN THAT SALE DEEDS ARE PRE PARED BY THE DEED WRITERS AND THE FACTOR OF ADVANCE MIGHT NO T HAVE BEEN RECORDED IN THE SALE DEED BUT IT IS A FAC T THAT THE IMPUGNED PROPERTY WAS SOLD BY THE ASSESSEE TO SMT. AMARJIT KAUR FOR A TOTAL CONSIDERATION OF RS. 17,50 ,000/-. THEREFORE, WHEN THE PURCHASER HAS CONFIRMED GIVING OF ADVANCE TO THE ASSESSEE IN HER AFFIDAVIT AS WELL AS IN HER STATEMENT RECORDED ON OATH UNDER SECTION 131 OF T HE ACT, THERE IS NO REASON TO BELIEVE THAT NO ADVANCE WAS GIVEN TO THE ASSESSEE. FURTHER, IT WAS OPENING BAL ANCE ON 01.04.2010 AND ACCORDING TO EXPLANATION OF THE ASSESSEE, THE SAME FACTS WERE DISCLOSED IN THE BALA NCE SHEET ALONGWITH OLD SAVINGS FROM AGRICULTURAL LAND AS ON 31.03.2010. THEREFORE, OPENING BALANCE CANNOT BE A DDED IN ASSESSMENT YEAR UNDER APPEAL WHICH IS SATISFACTO RILY EXPLAINED BY THE ASSESSEE. THE ASSESSEE ALSO PRODU CED COPIES OF HIS BANK STATEMENTS IN WHICH DURING THE Y EAR UNDER CONSIDERATION, THERE ARE SUFFICIENT WITHDRAWA LS MADE BY ASSESSEE WHICH WERE AVAILABLE TO THE ASSESS EE 5 FOR RE-DEPOSIT IN THE BANK ACCOUNT. THUS, THE ASSE SSEE IS ABLE TO EXPLAIN SOURCE OF THE CASH DEPOSIT IN THE B ANK ACCOUNT OF THE ASSESSEE. FROM WHERE THE PURCHASER H AS BROUGHT THE MONEY FOR PURCHASE OF THE LAND IN QUEST ION IS NOT THE CONCERN OF THE ASSESSEE BECAUSE IT IS AD MITTED FACT THAT PROPERTY UNDER CONSIDERATION WAS SOLD BY ASSESSEE TO SMT. AMARJIT KAUR AGAINST TOTAL CONSIDERATION. THEREFORE, EXPLANATION OF THE ASSES SEE SHOULD NOT HAVE BEEN DISBELIEVED BY THE ASSESSING OFFICER. 7. I, ACCORDINGLY, SET ASIDE THE ORDERS OF AUTHORIT IES BELOW AND DELETE THE ADDITION OF RS. 14,31,253/-. 8. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED . ORDER PRONOUNCED IN THE OPEN COURT. SD/- (BHAVNESH SAINI) JUDICIAL MEMBER DATED 10 TH FEBRUARY,2017. POONAM COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT(A) 4. THE CIT,DR ASSISTANT REGISTRAR, ITAT CHANDIGARH