ITO, RAJSAMAND V. M/s. Om Harihar Marble, JAIPUR

ITA 465/JODH/2010

• Counselvise Citation: [2012] 119 COUNSELVISE.COM (IT) 7897 (ITAT-JODHPUR)
• Duration Of Justice: 1 year(s) 11 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-08-2012
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2002-2003
• Appeal Filed On: 25-08-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: G R KOKANI
• Assessee Lawyers: SHYAM SINGHVI

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL JODHPUR BENCH JODHPUR. ( BEFORE SHRI R.K. GUPTA AND SHRI N.K. SAINI ) ITA NO. 465/JU/2010 ASSTT. YEAR : 2002-03 PAN: ADDPM 4142 P THE ITO VS. M/S. OM HARIHAR MARBLE WARD- 2 243, GIRNAR COLONY, GANDHIPATH RAJSAMAND QUEEN ROAD, JAIPUR (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI SHYAM SINGHVI DEPARTMENT BY : SHRI G.R. KOKANI DATE OF HEARING : 26.07.2012. DATE OF PRONOUNCEMENT : 22-08-2012 ORDER DATED :22/08/2012. PER R.K. GUPTA, J.M. THIS IS AN APPEAL BY REVENUE AGAINST THE ORDER OF THE LD.CIT(A), UDAIPUR DATED 08-06-2010 FOR THE ASSESSMENT YEAR 2002-03. 2.1 THE BRIEF FACTS OF THE CASE ARE THAT THE AO MAD E ADDITION ON THE BASIS OF SALE AGREEMENT FOUND IN THE COURSE OF SEARCH ON 11-12-20 003 AT THE RESIDENTIAL AND BUSINESS PREMISES OF SHRI ROSHAN LAL SANKHLA AND HIS STATEME NT DATED 13-01-2004. THE AO OBSERVED THAT THE SAID AGREEMENT TO SALE OF MINE DA TED 07-02-2002 WAS TAKEN PLACE BETWEEN SHRI MAN MOHAN MEHTA, PARTNER OF THE ASSESS EE FIRM AND SHRI ROSHAN LAL SANKHLA STATING THE RECEIPT OF RS. 5,00,111/- AND T HE REST RS. 12,00,000/- TO BE RECEIVED ON 15-02-2002 AND THE BALANCE WAS AGREED UPON TO BE PA ID AT THE TIME OF TRANSFER OF THE MINE 2 BY THE MINING DEPARTMENT. THUS THE TOTAL SALE CONSI DERATION OF MINE WAS TO THE TUNE OF RS. 27,00,111/-. 2.2 DETAILED SUBMISSIONS WERE FILED BEFORE THE LD. CIT(A) WHICH HAS BEEN DISCUSSED IN PARA 4.2 AT PAGE 3 OF HIS ORDER. AFTER CONSIDERI NG THE SUBMISSIONS, THE LD. CIT(A) HAS GIVEN HIS FINDING ON MERIT WHICH IS AS UNDER:- NOW, COMING TO THE MERIT OF THE CASE, IT IS SEEN THAT THE ADDITION HAS BEEN MADE BY THE AO ON ACCOUNT OF THE ASSESSEE BEING THE SELLER OF MINE TO SHRI ROSHAN LALSANKHLA AND RECEIV ING RS. 27,00,111/-. THE REPLY OF THE A.R. HAS BEEN GONE THROUGH AND FOU ND THAT THE ASSESSEE WAS OWNER OF THE MINE IN THE ASSESSMENT YEAR UNDER CONSIDERATION AS PER GOVT. RECORDS AND THE OWNERSHIP OF THE MINE WAS TRA NSFERRED TO SHRI SUNIL JAIN S/O SHRI MISHRI LAL JAIN VIDE TRANSFER DEED D ATED 13-03-2002 W.E.F. 18-03-2002. THE ABOVE MINING LEASE WAS SUBSEQUENTLY TRANSFERRED IN THE NAME OF SMT. BINDIYA SANKHLA ON 07-04-2003.THIS FAC T HAS BEEN ADMITTED BY SHRI SUNIL JAIN IN HIS STATEMENT DATED 20-03-200 6 RECORDED BY ACIT, CENTRAL CIRCLE- 2, UDIAPUR IN THE CASE OF SHRI ROSH AN LAL SANKHLA. IT IS ALSO EVIDENT FROM THE MINING RECORDS THAT SHRI SUNI L JAIN HAS RUN THIS MINE FOR MORE THAN ONE YEAR. COPY OF THE AFFIDAVIT OF SH RI MAN MOHAN MEHTA FILED IN THE CASE OF SHRI ROSHAN LAL SANKHLA REVEAL ED AND CONFIRMED THE TRANSFER OF MINE IN FAVOUR OF SHRI SUNIL JAIN AND S TATES THAT THE SALE AGREEMENT WAS EXECUTED BETWEEN THE ASSESSEE FIRM AN D SHRI ROSHAN LAL SANKHLA WAS NOT REAL. SHRI ROSHAN LAL SANKHHLA HAS ALSO STATED IN HIS STATEMENT RECORDED ON 13-01-2004 IN REPLY TO Q.NO.9 BEFORE ADIT, UDIAPUR THAT THE AGREEMENT WAS EXECUTED BETWEEN HIM AND SHRI MAN MOHAN MEHTA ON 07-02-2002 WAS CANCELLED AND THIS MI ND SOLE TO SHRI SUNIL JAIN LATER ON 13-03-2002. IT IS TO BE FURTHER NOTED THAT HON'BLE ITAT, JODHP UR IN CASE OF SHRI ROSHAN LAL SANKHLA AT PAGE NOS. 9 & 10 OF THE APPEL LATE ORDER HAS HELD THAT SUCH MINE WAS IN FACT PURCHASED BY SHRI SUNIL JAIN FROM THE ASSESSEE AND THE SAME WAS TRANSFERRED IN THE GOVT. RECORDS A ND ALSO FOR WANT OF 3 COGENT AND RELIABLE MATERIAL ON RECORD TO PROVE ANY INVESTMENT BY THE ASSESSEE, THE ADDITION MERELY ON THE BASIS OF ADMIS SION OF SHRI ROSHAN LAL SANKHLA WHICH STOOD VALIDLY RETRACTED AND WAS NEITH ER FACTUALLY NOR LEGALLY JUSTIFIED AND THEREFORE, THE AO WAS GROSSLY INCORRE CT AND UNJUSTIFIED TO HOLD PURCHASE OF MINE BY SHRI ROSHAN LAL SANKHLA FR OM THE ASSESSEE FOR RS. 27,00,111/-. ON THE BASIS OF SUCH UNCORROBORATE D AND CANCELLED AGREEMENT , THE ITAT HAS DECLARED THE ADDITION. THE SAME SALE AGREEMENT HAS BEEN MADE THE BASIS OF ADDITION BY THE AO IN TH IS CASE ALSO WHICH WAS CANCELLED BY BOTH THE PARTIES OF THE AGREEMENT AND WAS NEVER EXECUTED. SUBSEQUENTLY, TRANSACTION BETWEEN THE ASSESSEE AND SHRI SUNIL JAIN AND FURTHER BETWEEN SHRI SUNIL JAIN AND SMT. BINDIYA SA NKHLA PROVE FURTHER THAT THERE WAS NO EVIDENCE IN SUPPORT OF PAYMENTS F OR THE PURCHASE AND SALE OF MINE AT ALL. THE ADDITION OF RS. 27,00,111/ - WAS THEREFORE, NOT ALL REQUIRED BY THE AO. THEREFORE, THIS ADDITION IS DEL ETED AND APPEAL IN ALLOWED ON THIS GROUND. 2.3 THE LD. DR PLACED RELIANCE ON THE ORDER OF THE AO. 2.4 ON THE OTHER HAND, THE LD. AR PLACED RELIANCE O N THE ORDER OF THE LD. CIT(A) . 2.5 AFTER CONSIDERING THE ORDERS OF THE LOWER AUTHO RITIES, WE FIND NO INFIRMITY IN THE FINDINGS OF THE LD. CIT(A) AS LD. CIT(A) HAS DELETE D THE ADDITION ON THE BASIS OF THE DECISION OF THE TRIBUNAL IN CASE OF ROSHAN LAL SANK HLA VS. ACIT (ITA NO.92/JU/2007 DATED 26-03-2010) AND THE COPY OF THE SAME IS PLACE D ON RECORD. IN FACT, SIMILAR ADDITION WAS MADE IN THE HANDS SHRI ROSHAN LAL SANKHLA. THE TRIBUNAL AFTER ASCERTAINING THE FACTUAL MATRIX CAME TO THE CONCLUSION THAT THE AGRE EMENT OF SALE OF MINE WAS CANCELLED AND THEREFORE, ANOTHER AGREEMENT WAS MADE BY WHICH THE MINE WAS SOLD TO SHRI SUNIL JAIN AND NOT TO SHRI ROSHAN LAL SANKHLA. ACCORDINGLY, ON THE BASIS OF THE AGREEMENT ENTERED BETWEEN THE ASSESSEE AND SHRI ROSHAN LAL SANKHLA, I T WAS HELD THAT NO ADDITION CAN BE MADE AS THIS AGREEMENT WAS CANCELLED. THUS, ON THE BASIS OF THIS VERY AGREEMENT, THE 4 ADDITION WAS MADE IN THE HANDS ASSESSEE ALSO AND TH E TRIBUNAL HAS ALREADY HELD THAT THIS AGREEMENT DOES NOT SURVIVE AS THE SAME WAS CANCELLE D. ALL THESE FACTS HAS BEEN DISCUSSED BY THE LD. CIT(A) WHILE DELETING THE ADDITION. ACCO RDINGLY, WE CONFIRM HIS ORDER ON THIS ISSUE. 3.1 THE REMAINING ISSUE IS AGAINST REDUCING THE PRO FIT FROM RS. 50,000/- TO RS. 10,000/- ON SALE OF MARBLE. 3.2 THE AO OBSERVED THAT THE ASSESSEE SOLD 05 TRUCK S OF MARBLE AND THEIR TOTAL OF THE SALE WAS AT RS. 1.00 LACS. THE AO ESTIMATED THE PRO FIT ON THE SALE OF MARBLE AT RS. 50,000/- NET. 3.3 THE LD. CIT(A) DELETED THE ENTIRE ADDITION BY O BSERVING THAT 50% MARGIN CANNOT BE THERE IN SALE OF MARBLE AND IF THERE IS ANY INCO ME THEN THAT CANNOT BE MORE THAN RS. 10,000/-. SINCE ASSESSEE'S INCOME IS NOT TAXABLE TH EREFORE, ENTIRE ADDITION WAS DELETED 3.4 AFTER CONSIDERING THE ORDERS OF THE LOWER AUTHO RITIES, WE FOUND NO INFIRMITY IN THE ORDER OF THE LD. CIT(A) AND THE SAME IS CONFIRMED. 4. IN THE RESULT, APPEAL OF THE REVENUE IS DISMISSE D. THE ORDER IS PRONOUNCED ON 22-08-2012. SD/- SD/- ( N.K. SAINI ) ( R.K. GUPTA ) ACCOUNTANT MEMBER JUDICIAL MEMBER JODHPUR, *MISHRA COPY FORWARDED TO :- 1. THE ITO, WARD- 2, RAJSAMAND . 2. M/S. OM HARIHAR MARBLE, JAIPUR BY ORDER 3. THE LD CIT (A) 4. THE LD. CIT 5. THE D/R 6. GUARD FILE (ITA NO.465/JU/2010) AR ITAT JODHPUR. 5