KAMAKSHI INTERNATIONAL, Jaipur V. DCIT, Jaipur

ITA 480/JPR/2016

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 1869 (ITAT-JAIPUR)
• Duration Of Justice: 1 year(s) 6 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 01-12-2017
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: Not Allotted
• Assessment Year: 2009-2010
• Appeal Filed On: 05-05-2016
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: R A VERMA CIT DR DHK
• Keywords: Unexplained investment; Sale consideration of property below Jantri Value; Fair market value; Valuation report
• Section: 50C; 153A; 132; 92; 69

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES , JAIPUR JH HKKXPUN] YS[KK LNL; ,O JH DQY HKKJR] U;KF;D L NL; DS LE{K BEFORE: SHRI BHAGCHAND, AM & SHRI KUL BHAR AT, JM VK;DJ VIHY LA-@ ITA NO. 480/JP/2016 FU/KZKJ.K O'K Z@ ASSESSMENT YEAR: 2009-10 M/S. KAMAKSHI INTERNATIONAL A-3, MOTI LAL ATAL ROAD, JAIPUR CUKE VS. THE DCIT CENTRAL CIRCLE 1, JAIPUR LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO .: AAJFK 5791 R VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT VK;DJ VIHY LA-@ ITA NO. 607/JP/2016 FU/KZKJ.K O'K Z@ ASSESSMENT YEAR: 2009-10 THE ACIT CENTRAL CIRCLE 1, JAIPUR CUKE VS. M/S. KAMAKSHI INTERNATIONAL A-3, MOTI LAL ATAL ROAD, JAIPUR LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO .: AAJFK 5791 R VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT FU/KZKFJRH DH VKSJ LS@ ASSESSEE BY: SHRI RAJEEV SOGANI, CA JKTLO DH VKSJ LS@ REVENUE BY:SHRI R.A. VERMA, ADDL. CIT - DR LQUOKBZ DH RKJH[K@ DATE OF HEARING : 07/09/2017 ?KKS'K .KK DH RKJH[K@ DATE OF PRONOUNCEMENT : 1 /12/2017 VKNS'K@ ORDER PER BHAGCHAND, AM BOTH THESE APPEALS ARE THE CROSS APPEALS FILED AGA INST THE ORDER OF THE LD. CIT(A)-4, JAIPUR DATED 29-03-2016 FOR THE A SSESSMENT YEAR 2009-10 RAISING FOLLOWING GROUNDS BY THE ASSESSEE A ND THE REVENUE. ITA NO. 480/JP/2016 M/S. KAMAKSHI INTERNATIONAL VS DCIT, CENTRAL CIRCLE-1, JAIPUR 2 ITA NO. 480/JP/2016 - ASSESSEE 1. IN THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW THE SEARCH PROCEEDINGS CONDUCTED U/S 132 IS PATENTLY ILLEGAL A ND CONSEQUENTLY THE ASSESSMENT MADE U/S 153A IS ILLEGAL, WITHOUT ANY BA SIS AND BEYOND SCOPE. RELIEF MAY PLEASE BE GRANTED BY HOLDING THE SEARCH PROCEEDINGS ILLEGAL AND CONSEQUENTLY QUASHING THE ASSESSMENT PR OCEEDING U/S 153A BEING VOID AND AB INITO. 2. IN THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW THE LD. CIT(A) HAS ERRED IN CONFIRMING THE ADDITION OF RS. 75,36,325/- U/S 69 OF THE I.T. ACT, 1961 OUT OF THE TOTAL ADDITION OF RS. 6,11,16,770/- MADE BY THE AO. THE ACTION OF THE LD. CIT(A) IS ILLEGAL, UNJUSTIFIED, ARBITRARY AND AGAINST THE CASE OF THE ASSESSEE. RELIEF MAY PL EASE BE GRANTED BY DELETING THE SAID ADDITION OF RS. 75,36,325/- ITA NO. 625/JP/2016 REVENUE 1. WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) WAS RIGHTLY IN RESTRICTING THE ADDITION TO RS. 75,36,325/- MADE ON ACCOUNT OF UNDISCLOSED INVESTMENT U/S 69 IG NORING THE FACT THAT LAND NEAR THE PLOT UNDER CONSIDERATION WAS REG ISTERED DURING THE SAME PERIOD AT RS. 70,000/- PER SQ. YARD AS APPLIED BY THE AO IN THIS CASE. 2.1 DURING THE COURSE OF HEARING, THE LD.AR OF THE ASSESSEE HAS NOT PRESSED THE GROUND NO. 1.HENCE, THE SAME IS DISMISS ED BEING NOT PRESSED. 3.1 APROPOS GROUND NO. 2 OF THE ASSESSEE AND GROUND NO. 1 OF THE REVENUE, THE FACTS AS EMERGES FROM THE ORDER OF THE LD. CIT(A) IS AS UNDER:- 3.1.2 I HAVE DULY CONSIDERED THE ASSESSEES SUBMISSION AND ALSO CAREFULLY GONE THROUGH THE ASSESSMENT ORDER. I HAVE ALSO TAKE N A NOTE OF THE FACTUAL MATRIX OF THE CASE AS WELL AS CASE LAWS RELIED UPON. HERE IN THIS CASE, AO TOOK THE FAIR MARKET VALUE OF THE PROPERTY AT RS. 7,40,60,000/= AGAINST THE DECLARED VALUE BY THE ASSESSEE AT RS. 1,29,43,230/= , ITA NO. 480/JP/2016 M/S. KAMAKSHI INTERNATIONAL VS DCIT, CENTRAL CIRCLE-1, JAIPUR 3 ACCORDINGLY ADDED THE DIFFERENTIAL AMOUNT OF RS. 6,11,16,770/= ON SUBSTANTIVE BASIS AND SIMULTANEOUSLY, ALSO ADDED PROTECTIVELY IN THE HANDS OF PARTNERS NAMELY SMT ARUNA SANKHALA( ITA NO.531/11-12 ), SMT SARITA SANKHALA( ITA NO 509/11-12 ), SHRI HEMANT RAJ SANKHALA( ITA NO527/11-12 ), AND SH VISHNU MEHRWAL ON THEIR PROFIT SHARING RATION FOR THE AY 2009-10 . APART FROM PRESENT APPEAL, AFOREMENTIONED APPEALS IN CASE OF SMT ARUNA SANKHALA, SMT SARITA S ANKHALA AND SH HEMANT SANKHALA ARE PENDING IN THIS CHARGE. IN THIS REGARD, IT IS S UBMITTED THAT ASSESSEE HAD PURCHASED THE LAND IN QUESTION FROM M/S SHREE OM BUILDERS AND COLONIZERS, LOHA MANDI, SANSAR CHANDRA ROAD, JAIPUR FOR A CONSIDERATION OF RS.1,20,00,000/- AND AFTER INCURRING FURTHER SUM, THE COST OF THE LAND IN THE HAND OF AP PELLANT FIRM COMES TO RS. 1,29,43,230/- .IN THE ASSESSMENT OF SELLER, M/S SHREE OM BUILDERS AND COLONIZERS, THE SALE CONSIDERATION WAS ADOPTED BY THE AO AT RS.7,40,60,000/- AND TAX WAS CALCULATED ACCORDINGLY. AGGRIEVED BY THE SAID A SSESSMENT ORDER, THE SELLER, M/S SHREE OM BUILDERS AND COLONIZERS , PREFERRED APPEAL BEFORE HONBLE CIT (A) CENTRAL JAIPUR WHO DISPOSED OF THE APPEAL VIDE ORDE R DATED 10-01-2014 IN ITA NO. 600/12-13 . ( REFER PB 49 - 67). HERE IN THIS APPEAL, LD CIT (A) ON THE BASIS OF VALUATION REPORT, REDUCED THE SALE CONSIDERATION FR OM RS.7,40,60,000/- ADOPTED BY THE A.O. TO RS.1,95,36,325/= BASED ON THE REPORT OF THE DVO. THIS RESULTED INTO ADDITION BEING REDUCED TO RS.75,36,325/- (1,95,36,325-1,20,00,000). FOR THE SAKE OF CLARITY, RELEVANT EXTRACT [ PARA 5(I TO IV) ] OF THE APPELLATE ORDER (ITA NO. 600/12-13) IS INTER ALIA REPRODUCED HERE AS UNDER: . (I) IN THE SUBMISSIONS ITSELF HE HAS ACCEPTED T HE FAIRNESS OF THE REPORT OF THE DVO SINCE IT HAS MENTIONED THAT THE APPELLANTS PLOT WA S ON A DIFFERENT LOCATION FROM THAT OF PLOT NO. D-112-A AND THAT IT WAS TO BE VALU ED AT RESIDENTIAL RATES WHEREAS PLOT NO. D-112-A WAS TO BE VALUED AT COMMER CIAL RATE. THEREFORE ADMITTEDLY THE DVO HAS CONSIDERED ALL THE OBJECTION S AND SUBMISSIONS OF THE APPELLANT WHILE PREPARING THE REPORT. (II) THE SUBMISSIONS THAT ICICI BANKS VALUATION RE PORT WAS TOTALLY BASELESS AND SHOULD NOT HAVE BEEN CONSIDERED AT ALL IS NOT ACCEP TABLE. FIRST OF ALL, IT IS A BANKING ORGANIZATION AND ITS VALUATION OF THE PROPE RTY CANNOT BE IGNORED COMPLETELY. MOREOVER THE DVO HAS TAKEN CARE NOT TO RELY SOLELY ON THE VALUATION OF THE BANK BUT HAS TAKEN COMPARABLE CASE S IN THE AREA FOR ARRIVING AT AN AVERAGE RATE OF THE PLOT, WHICH HAS BEEN WORK ED OUT AT RS. 2,16,323/- PER SQ. METER. THIS APPEARS TO BE A VERY JUDICIOUS METH OD OF WORKING OUT THE FAIR MARKET VALUE OF THE PROPERTY. (III) THE AR OF THE APPELLANT HAS GIVEN IN DETAIL H IS OBJECTIONS REGARDING THE COMPARABLE CASES WHOSE RATES WERE ADOPTED BY THE DV O FOR THE PURPOSE OF ITA NO. 480/JP/2016 M/S. KAMAKSHI INTERNATIONAL VS DCIT, CENTRAL CIRCLE-1, JAIPUR 4 WORKING OUT THIS AVERAGE. HOWEVER VALUATION OF PROP ERTY IS A TECHNICAL MATTER AND IT IS BEST LEFT TO A TECHNICALLY QUALIFIED PERS ON. IT IS PERTINENT TO NOTE HERE THAT THE APPELLANT ITSELF HAD ASKED FOR SUCH A VALU ATION TO BE DONE. IT IS FURTHER NOTICED THAT DUE-OPPORTUNITY WAS GIVEN TO THE APPEL LANT BY THE DVO WHILE PREPARING THIS REPORT AND THE REPORT WAS PREPARED A FTER HAVING CONSIDERED ALL HIS OBJECTION. THEREFORE I DO NOT FIND ANY MERIT IN THE OBJECTIONS NOW BEING RAISED BEFORE ME. IV) FINALLY THE MAIN OBJECTION IS THAT NO EVIDENCE WAS FOUND REGARDING EXTRA PAYMENT HAVING BEEN RECEIVED ON THE TRANSFER OF THI S PROPERTY IN THE CASE OF THE APPELLANT. IT IS TO BE KEPT IN MIND THAT THERE WAS VERY STRONG CIRCUMSTANTIAL EVIDENCE FOUND DURING THE SEARCH IN THE CASE OF SH. MAHAVEER SINGH SANKHLA GROUP OF UNACCOUNTED INVESTMENT HAVING BEEN MADE IN LAND BY THE VARIOUS COMPANIES OF THIS GROUP. IT WAS ON THE BASIS OF THI S CIRCUMSTANTIAL EVIDENCE THAT THE ADDITION WAS MADE BY THE AO IN THE TRANSACTION OF LAND BY THE ASSESSEE WITH M/S KAMAKSHI INTERNATIONAL PVT. LTD. PART OF THE SA NKHLA GROUP OF CASES. TO FURTHER VERIFY THIS CIRCUMSTANTIAL EVIDENCE EXPERT TECHNICAL OPINION WAS TAKEN AT THE INSTANCE OF THE APPELLANT BY REFERRING THE MATT ER TO THE DVO. THUS, THE REPORT OF THE DVO IS TECHNICALLY QUALIFIED AND RELI ABLE EVIDENCE SUFFICIENT TO CONFIRM THE ADDITION TO THE EXTENT OF DIFFERENCE TO THE EXTENT OF DIFFERENCE IN THE VALUE OF LAND DETERMINED BY THE DVO AND SHOWN BY AS SESSEE. THEREFORE THE ADDITION OF RS. 75,36,325/- IS CONFIRMED AS UNDISCLOSED RECEIPT IN THE HAND OF THE APPELLANT. IN VIEW OF FACTS AND CIRCUMSTANCES OF THE CASE AND RESPECTFULLY FOLLOWING THE AFOREMENTIONED DECISION OF LD CIT(A) CENTRAL JA IPUR, AO IS HEREBY DIRECTED TO ADOPT COST OF PURCHASE PAID ATRS. 1,95,36,325 (=1,20,00,000 + 75,36,325). ACCORDINGLY, THE ADDITION OF RS. 75,36,325/- ON ACC OUNT OF UNDISCLOSED INVESTMENT U/S 69 OF THE ACT IS HEREBY CONFIRMED. ASSESSEES A PPEAL IS PARTLY ALLOWED. 3.2 DURING THE COURSE OF HEARING, THE LD.AR OF THE ASSESSEE PRAYED FOR DELETION OF ADDITION CONFIRMED BY THE LD. CIT(A) FO R WHICH THE LD.AR OF THE ASSESSEE FILED THE FOLLOWING WRITTEN SUBMISSION . 3. SUBMISSIONS ITA NO. 480/JP/2016 M/S. KAMAKSHI INTERNATIONAL VS DCIT, CENTRAL CIRCLE-1, JAIPUR 5 3.1 OUR SUBMISSIONS BEFORE LD. CIT(A) PLACED AT PB - AT 76-173 AND AT 174-179 MAY PLEASE BE CONSIDERED IN CORRECT PERSPECTIVE. 3.2 DURING THE COURSE OF SEARCH, NO INCRIMINATING DOCUM ENT SUGGESTING ANY ON- MONEY PAYMENT WAS FOUND. NOR THE SELLER, IN THIS CASE, A DMITTED ANY ON-MONEY PAYMENT. 3.3 THE ADDITIONS HAVE BEEN MADE MERELY, DRAWING A PARA LLEL WITH THE PROPERTY SITUATED AT 2.5 KM AWAY FROM THE PROPERTY IN QUESTI ON. 3.4 LD. CIT(A) HAS ALLOWED RELIEF BUT AT THE SAME TIME COMMITTED A GRAVE ERROR IN BASING HIS DECISION ON A VALUATION REPORT OF THE DV O. 3.5 THE LAW NOWHERE GIVES ANY AUTHORITY TO MAKE OR CONF IRM ANY ADDITION ON THE BASIS OF A VALUATION REPORT, IN PARTICULAR, WHERE T HE PURCHASE TRANSACTION ITSELF IS ABOVE DLC RATE (AO ORDER PAGE 4, PARA13(I)). ADDITION CAN ONLY BE MADE IF THERE ARE DIRECT EVIDENCES FOR PAYING ANY ON-MONEY . 3.6 RELIANCE IS PLACED ON THE JUDGEMENT OF HONBLE ITAT DELHI BENCH F IN THE CASE OF RAKESH NARANG ORDER DATED 16.02.2015 (COPY SUPPLIED) WHEREIN THE HONBLE BENCH AFTER CONSIDERING RELEVANT LAW AND AL SO RELYING ON THE JUDGEMENT OF THE HONBLE SUPREME COURT IN THE CASE OF K.P. VARGHESE AND SHIVAKAMI HELD THAT NO ADDITION IS POSSIBLE ON THE BASIS OF VALUATION REPORT. RELEVANT PORTIONS OF THE ORDER ARE EXTRACTED BELOW: - 4.WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE RELEVANT MATERIAL ON RECORD. IT IS NOTICED THAT THE EXTANT A DDITION WAS MADE BY THE AO U/S 69B OF THE ACT. THE RELEVANT PART OF THIS SE CTION STIPULATES THAT: 'WHERE IN ANY FINANCIAL YEAR THE ASSESSEE HAS MADE INVESTMENTS OR AND THE ASSESSING OFFICER FINDS THAT THE AMOUNT EXP ENDED ON MAKING SUCH INVESTMENTS OR . EXCEEDS THE AMOUNT RECORDED IN THIS BEHALF IN THE BOOKS OF ACCOUNT MAINTAINED BY THE ASSESSEE FOR ANY SOURCE OF INCOME, AND THE ASSESSEE OFFERS NO EXPLANATION ABOUT SUCH E XCESS AMOUNT OR THE EXPLANATION OFFERED BY HIM IS NOT, IN THE OPINION O F THE ASSESSING OFFICER, SATISFACTORY, THE EXCESS AMOUNT MAY BE DEEMED TO BE THE INCOME OF THE ASSESSEE FOR SUCH FINANCIAL YEAR.' THE PRE-REQUISIT E CONDITIONS FOR MAKING AN ADDITION UNDER THIS SECTION ARE THAT FIRSTLY, TH E ASSESSEE SHOULD HAVE MADE INVESTMENT AND THEN THE AO SHOULD FIND THAT TH E AMOUNT ACTUALLY EXPENDED ON MAKING SUCH INVESTMENT IS MORE THAN THE AMOUNT RECORDED IN THE BOOKS OF ACCOUNT. IN OTHER WORDS, THERE SHOU LD BE SOME POSITIVE EVIDENCE WITH THE AO TO FIND THAT THE ASSESSEE HAD, IN FACT, INVESTED MORE AMOUNT THAN THAT ACTUALLY RECORDED IN THE BOOKS OF ACCOUNT. SUCH A ITA NO. 480/JP/2016 M/S. KAMAKSHI INTERNATIONAL VS DCIT, CENTRAL CIRCLE-1, JAIPUR 6 FINDING BY THE AO CAN BE BASED ON SOME POSITIVE EVI DENCE ABOUT THE MAKING OF MORE INVESTMENT THAN THAT DECLARED IN THE BOOKS OF ACCOUNT. THIS SECTION CANNOT BE TRIGGERED ON A MERE PRESUMPT ION OF THE AO. WHEN THE LEGISLATURE HAS UNAMBIGUOUSLY PROVIDED SO, IT I S IMPERMISSIBLE TO SUBSTITUTE SUCH A FINDING WITH A PRESUMPTION ABOUT ACTUAL INVESTMENT HAVING BEEN MADE BY THE ASSESSEE AT A LEVEL HIGHER THAN THAT DEPICTED IN THE BOOKS OF ACCOUNT. ONLY SOME POSITIVE AND IRREFU TABLE EVIDENCE CONVERTS A PRESUMPTION INTO A FINDING. ABSENT AFFIR MATIVE EVIDENCE, WHAT REMAINS IS A MERE SUPPOSITION OF UNEXPLAINED INVEST MENT ETC., WHICH CANNOT TAKE THE PLACE OF A FINDING OF THE AO TOWARD S UNEXPLAINED INVESTMENT. 5. THE CRUX OF THE MATTER IS THAT THE VALUE OF A PROPERTY ESTIMATED BY THE DVO OR THE REGISTERED VALUER, CAN NEVER BE CONC LUSIVE OF THE PRICE FINALLY BARGAINED. 6.THE HON'BLE SUPREME COURT IN THE CASE OF K.P. VAR GHESE V. ITO [1981] 131 ITR 597/7 TAXMAN 13 HAS HELD THAT THE ON US OF ESTABLISHING THAT THE CONDITIONS OF TAXABILITY ARE FULFILLED, IS ALWAYS ON THE REVENUE. IT IS FOR THE REVENUE TO SHOW THAT THERE IS AN UNDERST ATEMENT OF THE CONSIDERATION. IT FURTHER LAID DOWN THAT TO THROW T HE BURDEN OF SHOWING THAT THERE IS NO UNDERSTATEMENT OF THE CONSIDERATIO N ON THE ASSESSEE, WOULD BE TO CAST AN ALMOST IMPOSSIBLE BURDEN UPON H IM TO ESTABLISH A NEGATIVE. SIMILAR VIEW HAS BEEN REITERATED IN CIT V . SHIVAKAMI CO. (P.). LTD. [1986] 159 ITR 71/25 TAXMAN 80K (SC). IN THIS CASE, THEIR LORDSHIPS HAVE LAID DOWN THAT NO ADDITION CAN BE MA DE UNLESS THERE IS EVIDENCE THAT MORE CONSIDERATION THAN WHAT WAS STAT ED IN THE DOCUMENT, WAS RECEIVED. IN THE LIGHT OF THE ABOVE DECISIONS, IT IS MANIFEST THAT NO ADDITION CAN BE MADE UNLESS THE REVENUE PROVES UNDE RSTATEMENT OF CONSIDERATION WITH SOME COGENT EVIDENCE, APART FROM A MERE ESTIMATE OF THE COST OF VALUATION. 11.A CONJOINT READING OF SECTIONS 50C AND 56(2)(VII ) MAKES IT VIVID THAT WHEREAS 'STAMP VALUE' HAS BEEN SUBSTITUTED WITH THE 'FULL VALUE OF CONSIDERATION' IN CASE THE LATER IS LESS THAN THE F ORMER IN THE HANDS OF THE SELLER BY VIRTUE OF SECTION 50C, THE SUBSTITUTION O F THE 'STAMP VALUE' WITH THE 'ACTUAL PURCHASE PRICE, IN EXCESS OF RS.50,000/ -' HAS BEEN MADE EFFECTIVE IN THE HANDS OF THE BUYER ONLY WHERE ANY IMMOVABLE PROPERTY IS PURCHASED AFTER 1.10.2009. AS THE ASSESSEE BEFORE U S IS A BUYER, NATURALLY, HIS CASE WILL NOT BE COVERED U/S 50C BUT WILL BE GOVERNED BY SECTION 56(2)(VII). SINCE SECTION 56(2)(VII) IS APP LICABLE ON CASES IN WHICH THE INDIVIDUAL OR HUF RECEIVES IMMOVABLE PROP ERTY ON OR AFTER 1.10.2009 AND WE ARE DEALING WITH A CASE IN WHICH T HE PROPERTY HAS BEEN PURCHASED BY THE ASSESSEE IN THE FINANCIAL YEAR 200 7-08, THE MANDATE OF ITA NO. 480/JP/2016 M/S. KAMAKSHI INTERNATIONAL VS DCIT, CENTRAL CIRCLE-1, JAIPUR 7 SECTION 56(2)(VII) CANNOT APPLY RETROSPECTIVELY. ON CE THIS PROVISION IS NOT APPLICABLE, THE RATIO DECIDENDI IN THE CASE OF K.P. VARGHESE (SUPRA) AND SHIVAKAMI CO. (P.) LTD. (SUPRA) WOULD APPLY LEAVING NO SCOPE FOR MAKING ADDITION IN THE CIRCUMSTANCES AS ARE PREVAILING IN THE INSTANT CASE. WE, THEREFORE, UPHOLD THE VIEW TAKEN BY THE LD. CIT(A) ON THIS ISSUE. 3.7 IT IS UNDISPUTED THAT PURCHASE TRANSACTION IS EVIDE NCED BY A REGISTERED DEED. NO EVIDENCE CONTRARY TO REGISTERED DEED IS ACCEPTABLE IN VIEW OF THE PROVISIONS OF SECTION 91 AND SECTION 92 OF THE INDIAN EVIDENCE AC T, 1872. 3.8 SECTION 91 OF INDIAN EVIDENCE ACT, 1872 PROVIDES THAT WHEN THE TERMS OF A CONTRACT, OR OF A GRANT, OR OF ANY OTHER DISPOSITIO N OF PROPERTY, HAVE BEEN REDUCED TO THE FORM OF A DOCUMENT, AND IN ALL CASES IN WHICH ANY MATTER IS REQUIRED BY LAW TO BE REDUCED TO THE FORM OF A DOCU MENT, NO EVIDENCE SHALL BE GIVEN IN PROOF OF THE TERMS OF SUCH CONTRACT, GRANT OR OTHER DISPOSITION OF PROPERTY, OR OF SUCH MATTER, EXCEPT THE DOCUMENT IT SELF, OR SECONDARY EVIDENCE OF ITS CONTENTS IN CASES IN WHICH SECONDARY EVIDENC E IS ADMISSIBLE UNDER THE PROVISIONS HERE IN BEFORE CONTAINED. 3.9 SECTION 92 OF INDIAN EVIDENCE ACT, 1872 PROVIDES THAT WHEN THE TERMS OF ANY SUCH CONTRACT, GRANT OR OTHER DISPOSITION OF PR OPERTY, OR ANY MATTER REQUIRED TO THE FORM OF A DOCUMENT, HAVE BEEN PROVE D ACCORDING TO THE SEC. 91, NO EVIDENCE OF ANY ORAL AGREEMENT OR STATEMENT SHALL BE ADMITTED, AS BETWEEN THE PARTIES TO ANY SUCH INSTRUMENT OR THEIR REPRESENTATIVES IN INTEREST, FOR THE PURPOSE OF CONTRADICTING, VARYING ADDING TO OR SUBTRACTING FROM, ITS TERMS. 3.10 THE LAHORE HIGH COURT IN DIVANSINGH VS. GURBACHAN SINGH AND OTHERS AIR 1932 LAHORE 276 HELD THAT IN CASE OF A SALE, OTHER EVIDENCE OF THE TRANSACTION, THAN THE DEED ITSELF IS BARRED BY THE PROVISIONS OF SECTION 91 OF THE EVIDENCE ACT. 3.11 THE MYSORE HIGH COURT IN DODDAMALLAPPA V. GANGAPPA AIR 1962 MYSORE 44 HELD 'WHEN A SALE DEED HAS BEEN EXECUTED AND REGISTERED IN RESPECT OF CERTAIN IMMOVABLE PROPERTIES, IN A SUIT FOR POSSESSION BY THE VENDEE IT IS NOT OPEN TO THE VENDOR TO LET IN ORAL EVIDENC E TO SHOW THAT THE TERMS OF THE CONTRACT BETWEEN THE PARTIES WERE DIFFERENT OR WERE AT VARIANCE WITH THE TERMS CONTAINED IN THE REGISTERED DOCUMENT.' 3.12 THE KERALA HIGH COURT IN LEELAMMA AMBIKAKUMARI AND ANOTHER VS. NARAYANAN RAMAKRISHNAN AIR 1992 KERALA 115 AT 119 HELD THAT 'SECTION 91 AND 92 OF THE EVIDENCE ACT IS A COMPLETE BAR FOR ANY PARTY TO SET UP A CASE THAT THE CONSIDERATION FOR SALE IS MORE THAN WHAT I S MENTIONED IN THE ITA NO. 480/JP/2016 M/S. KAMAKSHI INTERNATIONAL VS DCIT, CENTRAL CIRCLE-1, JAIPUR 8 CONVEYANCE OR IN THE CONTRACT. IN THE PRESENT CASE THE PLAINTIFF HAS NO CASE THAT THE CONSIDERATION MENTIONED IN THE DOCUMENT WAS NOT PAID, OR THAT THERE WAS ANY FAILURE OF CONSIDERATION OR THAT THE CONSIDERAT ION AGREED TO BETWEEN THE PARTIES WAS OF A DIFFERENT KIND THAN WHAT WAS MENTI ONED IN THE DOCUMENT. THE DEFINITE CASE OF THE PLAINTIFF IS THAT THE REAL CON SIDERATION FOR THE SALE WAS RS.16,000/- WHERE AS THE CONVEYANCE SHOWS THE CONSI DERATION TO BE RS.10,000/-. IN VIEW OF THE PROVISIONS CONTAINED IN SEC.91 AND 92 OF THE EVIDENCE ACT, THE PLAINTIFF IS NOT ENTITLED TO PLEA D SUCH A CASE, NOR HE IS ENTITLED TO ADDUCE EVIDENCE IN SUPPORT OF THE SAME. ' 3.13 THE HON'BLE SUPREME COURT IN M/S. FEBRIL GASOSA VS. LAB OUR COMMISSIONER AND OTHERS AIR 1997 (S.C.) 954 AT 958 HAS HELD THAT .. A WRITTEN SETTLEMENT ARRIVED AT BETWEEN THE PARTIES C OULD NOT, THEREFORE, BE VARIED OR MODIFIED EXCEPT BY A WRITTEN SETTLEMENT O R BY A WRITTEN MEMORANDUM DULY SIGNED BY THE PARTIES INCORPORATING THE TERMS OF THE SO- CALLED UNDERSTANDING. SEC.92 OF THE INDIAN EVIDENCE ACT, 1 872 ALSO LAYS DOWN THAT WHEN THE TERMS OF ANY CONTRACT, GRANT OR SETTLEMENT , AS ARE REQUIRED BY LAW TO BE REDUCED TO THE FORM OF A DOCUMENT, HAVE BEEN PRO VED AS PER THE PROVISIONS OF SEC.91 OF THE EVIDENCE ACT, NO EVIDENCE OF ANY O RAL AGREEMENT OR SETTLEMENT SHALL BE ADMITTED AS BETWEEN THE PARTIES TO ANY SUC H INSTRUMENT OR THEIR REPRESENTATIVES IN INTEREST FOR THE PURPOSE OF CONT RADICTING VARYING ADDING TO OR SUBTRACTING FROM ITS TERMS...' 3.14 HYDERABAD BENCH OF ITAT IN SMT. K.NARASAMMA VS. ITO (1990) 32 ITD 494 HELD THAT 'ANY EVIDENCE STOOD PRECLUDED BY VIRTUE OF PROVISIO NS OF SECTIONS 91 AND 92 OF THE INDIAN EVIDENCE ACT, 1872, ACCORDI NG TO WHICH, WHEN THE TERMS OF ANY DISPOSITION OF PROPERTY, ETC., HAVE BE EN REDUCED TO THE FORM OF A DOCUMENT, NO EVIDENCE SHALL BE GIVEN IN PROOF OF TH E TERMS OF SUCH DISPOSITION OF PROPERTY EXCEPT THE DOCUMENT ITSELF. THIS BEING THE POSITION, ON FACTS AND IN LAW, NO WEIGHT COULD BE GIVEN TO THE STATEMENT OF B TO PROVE THAT AN AMOUNT OF RS. 3.5 LAKHS AND NOT RS. 3 LAKHS PASSED ON FROM B TO THE ASSESSEE AS SALE CONSIDERATION. 3.15 THE DEED IS A SYNTHESIS OF INTENTIONS OF PARTIES TO AN AGREEMENT AND AS THE DEED SPECIFICALLY PROVIDES THAT THE SELLER HAS RECEIVED CERTAIN AMOUNT ON THE SALE OF THE PROPERTY, THE MERE FACT THE PURCHASER CLAIMED A DDITIONAL AMOUNT BEING INCURRED ON THE PROPERTY IN THE STATEMENT RECORDED ON OATH, IS NOT ADMISSIBLE AS EVIDENCE IN LAW. RELIANCE IS PLACED ON THE JUDGMENT OF THE HON`BLE PUNJAB & HARYANA HIGH COURT IN THE CASE OF PARAMJIT SINGH (2010) 323 ITR 588 IN WHICH THE HONBLE COURT HELD THAT WE HAVE THOUGHTFULLY CONSIDERED THE SUBMISSIONS MADE BY THE LEARNED COUNSEL AND ARE OF THE VIEW THAT THEY DO NOT WARRANT ACCEPTANCE. THERE IS WELL-KNOWN PRINCIPLE T HAT NO ORAL EVIDENCE IS ADMISSIBLE ONCE THE DOCUMENT CONTAINS ALL THE TERMS AND CONDITIONS. SECS. 91 ITA NO. 480/JP/2016 M/S. KAMAKSHI INTERNATIONAL VS DCIT, CENTRAL CIRCLE-1, JAIPUR 9 AND 92 OF THE INDIAN EVIDENCE ACT, 1872 (FOR BREVIT Y 'THE 1872 ACT') INCORPORATE THE AFORESAID PRINCIPLE. ACCORDING TO S . 91 OF THE ACT WHEN TERMS OF A CONTRACT, GRANT OR OTHER DISPOSITION OF PROPER TY HAVE BEEN REDUCED TO THE FORM OF A DOCUMENT THEN NO EVIDENCE IS PERMISSIBLE TO BE GIVEN IN PROOF OF ANY SUCH TERM OR SUCH GRANT OR DISPOSITION OF THE PROPE RTY EXCEPT THE DOCUMENT ITSELF OR THE SECONDARY EVIDENCE THEREOF. ACCORDING TO S. 92 OF THE 1872 ACT ONCE THE DOCUMENT IS TENDERED IN EVIDENCE AND PROVE D AS PER THE REQUIREMENTS OF S. 91 THEN NO EVIDENCE OF ANY ORAL AGREEMENT OR STATEMENT WOULD BE ADMISSIBLE AS BETWEEN THE PARTIES TO ANY SUCH INSTR UMENT FOR THE PURPOSES OF CONTRADICTING, VARYING, ADDING TO OR SUBTRACTING FR OM ITS TERMS. 3.16 THE HON`BLE JAIPUR BENCH WAS SEIZED OF THE LEGAL ISSUE OF IMPACT OF SEC. 91 & 92 OF THE INDIAN EVIDENCE ACT, 1872 IN THE CASE O F SUNITA DHADDA VS. DEPUTY COMMISSIONER OF INCOME TAX (2012) 148 TTJ (J P) 719 AND SHRI GHANSHYAM DAS AGARWAL VS. ITO ITA NO. 1161/JP/2010 . THE HONBLE JAIPUR BENCH, FOLLOWING THE PUNJAB & HARYANA HIGH C OURT JUDGEMENT IN PARAMJIT SINGH VS. ITO, 323 ITR 588 , IN THE SAID CASE, HELD THAT NO OTHER/ ORAL EVIDENCE IS ADMISSIBLE AGAINST THE REGISTERED SALE DEED. 3.17 HONBLE ITAT JAIPUR BENCH IN THE CASE OF SHRI GHANSHYAM DAS AGARWAL (SUPRA) ALSO HELD THAT IT IS ALSO A TRITE LAW THAT WITNESS MAY LIE BUT DO CUMENTS DO NOT. IN THE FACE OF DOCUMENTARY EVIDENCE ON RECO RD, ORAL EVIDENCE IS NOT ENTITLED TO ANY WEIGHT. THIS FINDS SUPPORT FROM THE JUDGMENT RENDERED BY THE HONBLE APEX COURT IN THE CASE OF BEHARI LAL MURAR KA AND ORS. AIR 1978 SC 300: 1978 (1) SCC 109.. 3.18 HONBLE ITAT JAIPUR BENCH IN THE CASE OF SHRI SHARAD U. MISHRA ITA NO. 467/JP/2011 HAD ALSO FOLLOWED THE DECISION OF COORDINATE BENCH IN THE CASE OF SHRI GHANSHYAM DAS AGARWAL (SUPRA). IN VIEW OF THE ABOVE, ASSESSEES APPEAL MAY PLEASE BE ALLOWED AND DEPARTMENTAL APPEAL IN THIS REGARD MAY BE DISMISSED . 3.3 ON THE OTHER HAND, THE LD. DR SUPPORTED THE ORD ER OF THE AO. 3.4 WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE MATERIALS AVAILABLE ON RECORD. THE AO IN THIS CASE OBSERVED T HAT THE ASSESSEE HAD ACTUALLY PURCHASED THE LAND UNDER CONSIDERATION MUC H MORE THAN THE VALUE AS IT HAS SHOWN IN HIS RETURN OF INCOME. CERT AINLY, THE ASSESSEE HAD ITA NO. 480/JP/2016 M/S. KAMAKSHI INTERNATIONAL VS DCIT, CENTRAL CIRCLE-1, JAIPUR 10 MADE THE EXCESS PAYMENT THAN THAT HE HAS SHOWN IN H IS RETURN OF INCOME. THE AO ON THE BASIS OF THE FACTS AND CIRCUMSTANCES OF THE CASE TOOK THE FAIR MARKET VALUE OF THE LAND IN QUESTION I.E D-81, GHIYA MARG, BANIPARK, JAIPUR @ RS. 70,000/- PER SQ. YARD. THE AO THUS NOT ED THAT SINCE THE ABOVE MENTIONED LAND MEASURES 1058 SQ. YARDS, THERE FORE, ITS VALUE IS TAKEN AT RS. 7,40,60,000/-. ACCORDINGLY THE AO WORK ED OUT THE DIFFERENCE AMOUNT BETWEEN THE FAIR MARKET VALUE AND THE VALUE DECLARED BY THE ASSESSEE I.E RS. 6,11,16,770 (RS. 7,40,60,000 MINUS RS. 1,29,43,230) AND ADDED THE SAME TO THE TOTAL INCOME OF THE ASSESSEE U/S 69 OF THE ACT. IN FIRST APPEAL, THE LD. CIT(A) HAS SUSTAINED THE ADDI TION TO THE EXTENT OF RS. 75,36,325/- BY OBSERVING AS UNDER:- IN VIEW OF FACTS AND CIRCUMSTANCES OF THE CASE AN D RESPECTFULLY FOLLOWING THE AFOREMENTIONED DECISION OF LD CIT(A) CENTRAL JAIPUR , AO IS HEREBY DIRECTED TO ADOPT COST OF PURCHASE PAID ATRS. 1,95,36,325 (=1,20,00,000 + 75 ,36,325). ACCORDINGLY, THE ADDITION OF RS. 75,36,325/- ON ACCOUNT OF UNDISCLOSED INVESTMENT U/ S 69 OF THE ACT IS HEREBY CONFIRMED. ASSESSEES APPEAL IS PARTLY ALLOWED. LOOKING INTO THE FACTS OF THIS ISSUE, IT IS OBSERV ED THAT THIS BENCH HAS ALREADY DECIDED THE ISSUE IN THE CASE OF SHREE OM B UILDERS AND COLONIZERS VS DCIT (ITA NO. 174/JP/2014 [ASSESSEE'S APPEAL] AND ITA NO. 198/JP/2014 [REVENUES APPEAL] FOR THE ASSESSME NT YEAR 2009-10 BY OBSERVING AS UNDER:- ITA NO. 480/JP/2016 M/S. KAMAKSHI INTERNATIONAL VS DCIT, CENTRAL CIRCLE-1, JAIPUR 11 2.5 WE HAVE HEARD THE RIVAL CONTENTIONS AND PE RUSED THE MATERIALS AVAILABLE ON RECORD. WE FIND THAT THE AO ONLY ON THE BASIS THAT A PROPERTY AT PLOT NO.D-112A, BANI PARK, JAIPUR MEASU RING 1,000 SQ. YD. WAS SOLD FOR RS.7 CRORE GIVING A RATE OF RS.70,000/- PE R SQ. YD. APPLIED THAT RATE TO THE LAND IN QUESTION, I.E. D-81, GHIYA MARG, BANI P ARK MEASURING 1,058 SQ. YD. AND ACCORDINGLY TOOK THE VALUE OF LAND AT RS.7, 40,60,000/- AS AGAINST THE ACTUAL SALES CONSIDERATION OF RS.1,20,00,000/- AND MADE ADDITION OF RS.6,20,60,000/- ON ACCOUNT OF UNDISCLOSED MONEY RE CEIPT. THE LD. CIT(A) REFERRED THE MATTER OF DETERMINATION OF FMV OF LAND UNDER CONSIDERATION TO DVO (PBP 112) WHO DETERMINED THE SAME AT RS.1,95,36 ,325/- AND ACCORDINGLY CONFIRMED ADDITION OF RS.75,36,325/- ON ACCOUNT OF UNDISCLOSED RECEIPT. WE FIND THAT VALUE OF PLOT NO.D-81, GHIYA MARG, BANI PARK CANNOT BE COMPARED WITH PLOT NO.D-112A, NEAR RAM MANDIR, BANI PARK, JAIPUR AS BOTH THE PLOTS ARE SITUATED IN DIFFERENT LOCALITY, ON DI FFERENT WIDTH OF THE ROAD, HAVING DIFFERENT USES/COMMERCIAL VALUE, ETC. AS EX PLAINED BY THE LD.AR OF THE ASSESSEE IN WRITTEN SUBMISSION REPRODUCED ABOVE. I T IS ALSO UNDISPUTED FACT THAT IN CASE OF SEARCH CARRIED OUT AT THE RESIDENTI AL/BUSINESS PREMISES OF MAHAVEER SANKHLA, NO PAPER OR ANY OTHER EVIDENCE WA S FOUND TO ESTABLISH THAT M/S KAMAKSHI INTERNATIONAL WHO PURCHASED THIS PROPE RTY HAS PAID ANY CONSIDERATION OVER AND ABOVE THAT RECORDED IN THE S ALE DEED. WE THEREFORE, DO NOT CONCUR WITH THE ORDER OF AO MAKING ADDITION OF RS.6,20,60,000/- BY ASSUMING THE FMV OF THE LAND AT RS.7,40,60,000/-. S O FAR AS THE FINDING OF LD. CIT(A) IS CONCERNED, WE FIND THAT HE HAS ADOPTED TH E FMV OF LAND AS VALUED BY THE DVO AT RS.1,95,36,325/- AND THUS CONFIRMED T HE ADDITION OF RS.75,36,325/-. AN UNDISCLOSED INCOME CAN BE ASSESS ED WHEN THERE ARE EVIDENCES THAT SALE PRICE IS MANIPULATED OR UNDERST ATED. THE VALUATION DONE BY THE DVO IS ONE OF THE GOOD METHOD TO ARRIVE AT F AIR MARKET VALUE. THE SALE INSTANCES OF NEARBY AREA NEEDS CONSIDERATION WHILE VALUING THE PROPERTY. THE AO REFERRED THE ISSUE TO THE VALUATION OFFICER BUT THE DVO HAD HAD NOT TAKEN CONSIDERATION ALL THE OBJECTIONS RAISED BY THE ASSE SSEE REGARDING FAIR MARKET VALUE OF PLOT. THERE WAS A TRANSFORMER OF RSEB IN FRONT OF PLOT OF LAND WHICH GIVES A NEGATIVE IMPACT ON MARKET VALUE. THE ASSESS EE HAD SUBMITTED SALE INSTANCES OF PLOTS WHICH WERE LOCATED NEARBY TO THE PLOT OF THE ASSESSEE. THERE WAS SALE OF PLOT ON 15-04-2010 AT THE RATE O F RS. 15,185/- PER SQ. YARD WHICH IS NEAREST TO THE SALE OF ASSESSEE'S PLOT. T HE SIZE WAS ALSO NOT SMALL BUT OF 409.94 SQ. YARD IN COMPARISON TO ASSESSEE'S PLOT OF 1058L SQ. YARD. IT WAS ALMOST A YEAR LATER. COMPARING WITH THIS SALE INST ANCES WITH ADJUSTMENT FOR TIME PERIOD, COST INDEX INFLATION, SIZE AND OTHER P ECULIAR FACTS, WE ARE OF THE VIEW THAT FAIR MARKET VALUE (FMV) ON THE DATE OF SA LE MUST BE AROUND RS. 13,500/- PER SQ. YARD. CONSIDERING ALL THESE RELEVA NT FACTS & CIRCUMSTANCES OF THE CASE AND THE CASES REFERRED SUPRA, WE SUSTAIN T HE ADDITION OF RS. 22,83,000/-. THUS THE APPEAL OF THE ASSESSEE IS PAR TLY ALLOWED AND THAT OF THE REVENUE IS DISMISSED. ITA NO. 480/JP/2016 M/S. KAMAKSHI INTERNATIONAL VS DCIT, CENTRAL CIRCLE-1, JAIPUR 12 THE FACTS AND CIRCUMSTANCES OF THE PRESENT ISSUE A RE SAME AS ARE IN THE CASE OF M/S. SHREE OM BUILDERS AND COLONIZERS (SUPR A), THEREFORE, THE DECISION TAKEN THEREIN SHALL APPLY MUTATIS MUTANDIS IN THE CASE OF M/S. KAMAKSHI INTERNATIONAL, JAIPUR. THUS THE APPEAL OF THE ASSESSEE IS PARTLY ALLOWED AND THAT OF THE REVENUE IS DISMISSED. 4.0 IN THE RESULT, THE APPEAL FILED BY THE ASSESSE E IS PARTLY ALLOWED AND THAT OF THE REVENUE IS DISMISSED ORDER PRONOUNCED IN THE OPEN COURT ON 1-12-201 7. SD/- SD/- DQY HKKJR HKKXPUN (KUL BHARAT) ( BHAGCHAND) U;KF;D LNL; / JUDICIAL MEMBER YS[KK LNL;@ ACCOUNTANT MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 1 /12/ 2017 *MISHRA VKNS'K DH IZFRFYFI VXZSF'KR@ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ@ THE APPELLANT- M/S. KAMAKSHI INTERNATIONAL, JAIPUR 2. IZR;FKHZ@ THE RESPONDENT- THE ACIT/ DCIT, CENTRAL CIRCLE-1 , JAIPUR 3. VK;DJ VK;QDRVIHY@ CIT(A). 4. VK;DJ VK;QDR@ CIT, 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ@ DR, ITAT, JAIPUR 6. XKMZ QKBZY@ GUARD FILE (ITA NO. 480/JP/2016) VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ @ ASSISTANT. REGISTRAR