Sanjay Sopanrao Gondkar, Ahmednagar V. Income-tax Officer, Ahmedabad

ITA 493/PUN/2014

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 2627 (ITAT-PUNE)
• Duration Of Justice: 1 year(s) 11 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-02-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 18-02-2016
• Assessment Year: 2009-2010
• Appeal Filed On: 12-03-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MK SINGH
• Section: 143(3)

Judgement Text

] ]] ] IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH A, PUNE , !, # $ BEFORE MS. SUSHMA CHOWLA, JM AND SHRI PRADIP KUMAR KEDIA, AM ITA NO.493/PN/2014 ASSESSMENT YEAR : 2009-10 SANJAY SOPANRAO GONDKAR, PIMPALWADI ROAD, NEAR NAGAR PARISHAD SCHOOL, SHIRDI, TAL. RAHATA, DIST. AHMEDNAGAR. PAN : AKQPG0167N . APPELLANT VS. THE INCOME TAX OFFICER, WARD 1, AHMEDNAGAR. . RESPONDENT / APPELLANT BY : SHRI B. B. MANE / RESPONDENT BY : SHRI M. K. SINGH / DATE OF HEARING : 18.02.2016 / DATE OF PRONOUNCEMENT: 26.02.2016 % / ORDER PER PRADIP KUMAR KEDIA, AM : THE PRESENT APPEAL PREFERRED BY THE ASSESSEE IS AGA INST THE ORDER OF CIT(A)-IT/TP, PUNE DATED 10.12.2013 RELATING TO ASS ESSMENT YEAR 2009-10 PASSED UNDER SECTION 143(3) OF THE INCOME-TAX ACT, 1961 (IN SHORT THE ACT). 2. BY WAY OF THE PRESENT APPEAL, THE ASSESSEE HAS A SSAILED THE ACTION OF THE CIT(A) IN SUSTAINING THE ADDITION OF RS.21,76,500/- MADE BY THE ASSESSING OFFICER ON ACCOUNT OF INCOME FROM UNDISCLOSED SOURC ES. 3. THE FACTS CONCERNING THE ISSUE, IN BRIEF, ARE TH AT THE ASSESSEE IS A DEALER IN ELECTRONICS GOODS. THE ASSESSEE ALSO BELONGS TO A FARMER COMMUNITY AND HIS FAMILY IS IN THE AGRICULTURAL BUSINESS. DURING THE YEAR UNDER CONSIDERATION, THE ASSESSEE PURCHASED 36.5 R OF AGRICULTURAL LAND AT S URVEY NO.111/20 WITHIN THE 2 ITA NO.493/PN/2014 LIMITS OF SHIRDI NAGAR PANCHAYAT FOR RS.69,71,500/- . HE INCURRED EXPENSES OF RS.4,45,000/- TOWARDS STAMP DUTY AND REGISTRATION. THUS, HIS TOTAL EXPENDITURE TOWARDS PURCHASE OF LAND WAS RS.74,16,500/-. OUT O F THIS, THE ASSESSEE MADE PAYMENTS TOWARDS PURCHASES OF RS.46,40,000/- IN THE EARLIER FINANCIAL YEAR 2007-08 AND BALANCE PAYMENT OF RS.27,76,500/- WAS M ADE DURING THE YEAR UNDER CONSIDERATION. THE ASSESSING OFFICER EXAMINE D THE SOURCES OF RS.27,76,500/- PAID DURING THE YEAR. THE ASSESSEE EXPLAINED THAT HE HAD RECEIVED RS.6,00,000/- IN THIS YEAR AGAINST SALE OF LAND AT SURVEY NO.52/2 OF 40R TO SHRI KALYAN CHAKRAVARTHY FOR RS.36,00,000/-. BESIDES, DURING THE YEAR, HE HAD AVAILED LOANS FROM ANDHRA BANK AND DHANALAKS HMI PATASANSTHA AGGREGATING TO RS.13,29,875/-. THE BALANCE AMOUNT OF RS.8,46,625/- WAS PAID BY WITHDRAWING CASH FROM HIS PROPRIETARY BUSINESS. THE ASSESSING OFFICER ACCEPTED THE ASSESSEES CONTENTION WITH RESPECT TO THE SOURCE OF RS.6,00,000/-, BUT HE DID NOT ACCEPT THE ASSESSEES ARGUMENT THAT AMOUNT OF RS.13,29,875/- WAS OUT OF THE LOAN AVAILED FROM BANKS AS HE FOUND THAT THE LOANS WERE SANCTIONED MUCH AFTER THE DATE OF THE REGISTRATION OF PURCHASE DEED. IN SO FAR AS THE BALANCE AMOUNT OF RS.8,46,625/- IS CONCERNED, W HICH IS STATED TO HAVE BEEN WITHDRAWN FROM BUSINESS, THE ASSESSING OFFICER NOTE D THAT HE IS UNABLE TO ACCEPT TRADING ACCOUNT, PROFIT AND LOSS ACCOUNT, CA SH-FLOW STATEMENT AND BALANCE SHEET FILED BY THE ASSESSEE IN ABSENCE OF H IS BOOKS OF ACCOUNTS. HE NOTED THAT THE ASSESSEE COULD NOT FURNISH EVEN BASI C RECORDS SUCH AS PURCHASES AND SALES BILLS, EXPENDITURE VOUCHERS, STOCK REGIST ER, ETC.. FURTHER, THE ASSESSEES STOCK/TURNOVER RATIO FOR THE CURRENT YEA R WAS AS HIGH AS 39.17%, WHILE CASH ON HAND WAS ONLY RS.12,051/-. THEREFORE , THE ASSESSING OFFICER DID NOT FIND THE EXPLANATION OF THE ASSESSEE AS CONVINC ING THAT THE ASSESSEE WOULD HAVE SUCH A HUGE CASH OF RS.8,00,000/- IN HAND TO F UND PURCHASE OF LAND. ACCORDINGLY, THE ASSESSING OFFICER MADE DISALLOWANC E OF RS.21,76,500/- AND ADDED TO TOTAL INCOME OF THE ASSESSEE. 4. AGGRIEVED BY SUCH ACTION OF THE ASSESSING OFFICE R, THE ASSESSEE CARRIED THE MATTER BEFORE THE CIT(A). HOWEVER, THE ASSESSE E FAILED TO ATTEND THE APPELLATE PROCEEDINGS. THE CIT(A) CONFIRMED THE AC TION OF THE ASSESSING OFFICER EX PARTE. 3 ITA NO.493/PN/2014 5. AGGRIEVED BY THE ORDERS OF THE AUTHORITIES BELOW , THE ASSESSEE IS IN APPEAL BEFORE US. 6. THE LD. AUTHORISED REPRESENTATIVE ON BEHALF OF T HE ASSESSEE REITERATED THE SUBMISSIONS MADE BEFORE ASSESSING OFFICER AND I N FURTHERANCE PLEADED THAT IN THE INTEREST OF EQUITY AND JUSTICE, AN OPPORTUNI TY MAY BE GRANTED TO JUSTIFY THE CASE OF THE ASSESSEE. HE REFERRED TO THE ORDER OF THE CIT(A) AND SUBMITTED THAT IT IS APPARENT THAT REQUISITE APPLICATION OF M IND WHILE FRAMING THE IMPUGNED ORDER IS ABSENT. THE CONCLUSION OF THE AS SESSING OFFICER IS WITHOUT ASCERTAINING THE FACTS IN PERSPECTIVE AND ACCORDING LY NOT SUSTAINABLE IN LAW. 7. THE LD. DEPARTMENTAL REPRESENTATIVE ON BEHALF OF THE REVENUE, ON THE OTHER HAND, RELIED UPON THE ORDERS OF THE AUTHORITI ES BELOW. 8. WE HAVE CAREFULLY CONSIDERED THE ORDERS OF THE A UTHORITIES BELOW AND RIVAL CONTENTIONS. THE ONLY ISSUE INVOLVED IS BONA FIDES OF SOURCE OF INVESTMENT. AT THE OUTSET, WE NOTE THAT THE ASSESS EE HAS REMAINED RECALCITRANT BEFORE THE CIT(A) AND HAS FAILED TO ATTEND THE APPE LLATE PROCEEDINGS. HOWEVER, IN THE SAME VAIN, WE NOTE THAT THE ORDER O F THE CIT(A) IS ALSO VERY BRIEF AND CRYPTIC. IT EMERGES FROM THE ASSESSMENT ORDER THAT FACTS MARSHALED BY THE ASSESSEE REQUIRES FRESH CONSIDERATION. THE FLO W OF FUNDS FROM THE PROPRIETARY CONCERN TOWARDS THE IMPUGNED INVESTMENT IN AGRICULTURAL LAND ALSO DESERVES TO BE VERIFIED. IT IS AN ADMITTED POSITIO N THAT LOAN OF RS.13,29,875/- HAS BEEN SANCTIONED TO THE ASSESSEE WHICH IS CLAIME D TO HAVE BEEN ULTIMATELY UTILIZED FOR THE AFORESAID INVESTMENTS. IT WILL BE IN FITNESS OF THINGS THAT FLOW OF BORROWED FUNDS IS ALSO EXAMINED IN AGRICULTURAL LAN D. SINCE COLLATION OF FLOW OF FUNDS IS REQUIRED, IT IS ONLY PROPER THAT MATTER BE REMITTED TO THE FILE OF THE ASSESSING OFFICER. IN THE TOTALITY OF THE CIRCUMST ANCES, WE CONSIDER IT JUST AND EXPEDIENT THAT ENTIRE MATTER IS RE-EXAMINED AND IMP UGNED ASSESSMENT ORDER IS FRAMED DENOVO IN ACCORDANCE WITH LAW AFTER GIVING PROPER OPPORTU NITY THE ASSESSEE IN THIS REGARD. THE ASSESSEE IS ACCORDING LY IS GIVEN A FINAL OPPORTUNITY TO ADDUCE EVIDENCES AND COMPLY WITH THE QUERIES OF THE ASSESSING OFFICER AS MAY BE RAISED IN THIS REGARD. IN TERMS OF THE AFOR ESAID DIRECTION, THE MATTER IS 4 ITA NO.493/PN/2014 SET ASIDE AND REMITTED BACK TO THE FILE OF THE ASSE SSING OFFICER FOR DENOVO CONSIDERATION OF THE ISSUE IN ACCORDANCE WITH LAW. 9. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED ON THIS 26 TH DAY OF FEBRUARY, 2016. SD/- SD/- ( SUSHMA CHOWLA ) ( PRADIP KUMAR KEDIA ) / JUDICIAL MEMBER # / ACCOUNTANT MEMBER PUNE ; DATED : 26 TH FEBRUARY, 2016. % & '() *)' / COPY OF THE ORDER IS FORWARDED TO : 1) THE ASSESSEE; 2) THE DEPARTMENT; 3) THE CIT(A)-IT/TP, PUNE; 4) THE CIT-IT/TP, PUNE; 5) THE DR A BENCH, I.T.A.T., PUNE; 6) GUARD FILE. %+ / BY ORDER , ' # //TRUE COPY// $ %& # '( / SR. PRIVATE SECRETARY ) '* , / ITAT, PUNE