Vikas Teotia, Hapur V. ITO, Ward-3(5), Hapur

ITA 5181/DEL/2018

• Counselvise Citation: [2019] 115 COUNSELVISE.COM (IT) 9598 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 2 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 01-10-2019
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: SMC
• Assessment Year: 2014-2015
• Appeal Filed On: 31-07-2018
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: S L ANURAGI
• Keywords: Unexplained cash credit; Gift; Opportunity of being heard; Deemed to accrue or arise in india; Additional evidence; Capital receipt
• Section: 143(3); 68; 69

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH : SMC : NEW DELHI BEFORE SHRI R.K. PANDA, ACCOUNTANT MEMBER ITA NO.5181/DEL/2018 ASSESSMENT YEAR: 2014-15 VIKAS TEOTIA, C/O RAG & ASSOCIATES, CAS, 209, JAGDAMBA TOMER, 13, PREET VIHAR COMMERCIAL COMPLEX, DELHI 110 092. PAN: ADAPT9378H VS. ITO, WARD-3(5), HAPUR. (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI NIKHIL GUPTA, CA REVENUE BY : SHRI S.L. ANURAGI, SR.DR DATE OF HEARING : 07.08.2019 DATE OF PRONOUNCEMENT : 01.10.2019 ORDER THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER DATED 16 TH MAY, 2018 OF THE CIT(A), MUZAFFARNAGAR, RELATING TO ASSESSMENT Y EAR 2014-15. 2. FACTS OF THE CASE, IN BRIEF, ARE THAT THE ASSESS EE IS AN INDIVIDUAL AND FILED HIS RETURN OF INCOME ON 15 TH SEPTEMBER, 2014 DECLARING TOTAL INCOME AT RS.2,24, 880/- AND AGRICULTURAL INCOME OF RS.1,75,000/-. THE ASSESSIN G OFFICER COMPLETED THE ASSESSMENT U/S 143(3) DETERMINING THE TOTAL INCOME OF THE ASSE SSEE AT RS.25,41,630/- WHEREIN, APART FROM OTHER ADDITIONS, THE ASSESSING OFFICER M ADE ADDITION OF RS.7,83,085/- TREATING THE SALE OF SPONTANEOUSLY GROWN TREES AS INCOME FROM OTHER SOURCES AS ITA NO.5181/DEL/2018 2 AGAINST AGRICULTURAL INCOME DECLARED BY THE ASSES SEE. SIMILARLY, HE ALSO MADE ADDITION OF RS.8,60,000/- BEING THE CASH DEPOSITED IN THE BANK ACCOUNT AS AGAINST SALE OF AGRICULTURAL STOCK CLAIMED BY THE ASSESSEE. THE A.O. FURTHER MADE ADDITION OF RS.2,52,500/- OUT OF THE GIFT OF RS.4,50,000 RECEIV ED BY THE ASSESSEE FROM HIS MOTHER AS GIFT BY INVOKING THE PROVISIONS OF SECTION 68 OF THE IT ACT. IN APPEAL, THE LD.CIT(A) SUSTAINED ALL THE ABOVE THREE ADDITIONS MADE BY THE ASSESSING OFFICER WHICH ARE THE SUBJECT MATTER OF APPEAL IN THE GROUNDS OF APPEAL R AISED BY THE ASSESSEE. 3. AGGRIEVED WITH SUCH ORDER OF THE CIT(A), THE ASS ESSEE IS IN APPEAL BEFORE THE TRIBUNAL BY RAISING THE FOLLOWING GROUNDS:- 1. THAT ON THE FACTS OF THE CASE AND UNDER THE LAW , THE ID CIT(A) HAD ERRED IN SUSTAINING THE ADDITION OF RS.48,420/-, WHICH WA S MADE BY THE LD A.O. AS DEEMED INCOME FROM HOUSE PROPERTY. 2. THAT ON THE FACTS OF THE CASE AND UNDER THE LAW , THE ID CIT(A) HAD ERRED IN SUSTAINING THE ADDITION OF RS.8,60,000/- BEING A MOUNT OF SALE OF OLD AGRICULTURE STOCK WHICH WAS MADE BY THE LD A.O. AS INCOME FROM OTHER SOURCE AND ALSO INVOKING THE PROVISION OF SEC 69A, FOR CONFIRMING T HE ADDITION OF RS.8,60,000/-. 3. THAT ON THE FACTS OF THE CASE AND UNDER THE LAW, THE LD CIT(A) HAD ERRED IN SUSTAINING THE ADDITION OF RS.7,83,085/- WHICH W AS MADE BY THE LD A.O. BY DISBELIEVING THE ASSESSEE'S CLAIM THAT HE HAD SOLD POPULAR TREES (WHICH WERE GROWN BY HIM FEW YEARS AGO IN HIS AGRICULTURAL LAND SITUATED IN VILLAGE BHODALA, TEHJSIL MODINAGAR, DISTT. GHAZIABAD) , THROUGH KRIS HI UTPADAN MANDI SAMITI, HAPUR AND RECEIVED PAYMENT OF RS.7,83,085/- TOWARDS THE SALE PROCEEDS OF POPULAR TREES FROM M/S GANESH TIMBER PRODUCTS & M/S SINGHAL WOOD PRODUCTS (THROUGH BANKING CHANNEL). 4. THAT ON THE FACTS OF THE CASE AND UNDER THE LAW , THE LD CIT(A) HAD ERRED IN INVOKING THE PROVISION OF SEC 69A, FOR CONFIRMIN G THE ADDITION OF RS.7,83,085/- 5. THAT ON THE FACTS OF THE CASE AND UNDER THE LAW, THE LD CIT(A) HAD ERRED IN SUSTAINING THE ADDITION OF RS. 2,52,500/- BEING AMOUNT GIFTED BY HIS MOTHER WHICH WAS MADE BY THE LD A.O. AS INCOME FROM OTHER SOURCE AND ALSO INVOKING THE PROVISION OF SEC 69, FOR CONFIRMING TH E ADDITION OF RS 2,52,500/-. ITA NO.5181/DEL/2018 3 4. THE LD. COUNSEL FOR THE ASSESSEE DID NOT PRESS G ROUND OF APPEAL NO.1 TO WHICH THE LD. DR HAS NO OBJECTION. ACCORDINGLY THIS GROU ND IS DISMISSED AS NOT PRESSED. SO FAR AS THE ADDITION OF RS.7,83,050/- MADE BY THE AS SESSING OFFICER IS CONCERNED, THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE ASSESSE E HAD NOT CLAIMED THE RECEIPT OF RS.7,83,050/- TO BE HIS AGRICULTURAL INCOME, BUT, H AD CLAIMED THE SAME AS CAPITAL RECEIPT. HE SUBMITTED THAT THE ASSESSEE HAD GROWN POPLAR TREES IN HIS AGRICULTURAL LAND SITUATED IN VILLAGE BHODALA, TEHJSIL MODINAGAR, DIS TT. GHAZIABAD) AND THOSE POPLAR TREES WERE SOLD IN FINANCIAL YEAR 2013-14 THROUGH K RISHI UTPADAN MANDI SAMITI, HAPUR. THE SALE CONSIDERATION OF RS.7,83,050/- IN RESPECT OF SALE OF POPLAR TREES WAS RECEIVED FROM M/S GANESH TIMBER PRODUCTS AND M/S SI NGHAL WOOD INDUSTRIES. SO FAR AS THE ADDITION OF RS.8,60,000/- MADE BY THE ASSESS ING OFFICER AND UPHELD BY THE CIT(A) IS CONCERNED, HE SUBMITTED THAT THE AFFIDAVI T FROM SELLERS OF POTATOES, THEIR LAND HOLDING DETAILS AND THE COPIES OF THE CASH BOOK OF THE ASSESSEE SUBSTANTIATING THE PURCHASE AND SALES OF POTATOES WERE FURNISHED. HOW EVER, DESPITE FILING OF VARIOUS EVIDENCES, THE LD.CIT(A) HAS NOT CONSIDERED THOSE E VIDENCES AND DID NOT ADJUDICATE THE ISSUE PROPERLY. SO FAR AS THE GIFT RECEIVED FROM M OTHER IS CONCERNED, THE LD. COUNSEL SUBMITTED THAT THE ASSESSEE HAS FILED THE COPY OF T HE GIFT DEED, THE INCOME-TAX RETURN AND BANK STATEMENTS OF THE MOTHER OF THE ASSESSEE I .E., THE DONOR TO SUBSTANTIATE THE IDENTITY AND CREDIT WORTHINESS OF THE DONOR AND THE GENUINENESS OF THE TRANSACTIONS. HOWEVER, THOSE WERE NOT PROPERLY CONSIDERED. ITA NO.5181/DEL/2018 4 5. THE LD. COUNSEL FOR THE ASSESSEE FILED CERTAIN A DDITIONAL EVIDENCES IN THE SHAPE OF COPY OF KHASRA FORM IN RESPECT OF HIS AGRICULTURAL AND SITUATED IN VILLAGE BHODALA, TEHJSIL MODINAGAR, DISTT. GHAZIABAD ACCORDING TO WH ICH POPLAR TREES WERE STANDING ON THE ASSESSEES AGRICULTURAL LAND IN F.Y. 2012-13. SIMILARLY, IN RESPECT OF SALE OF POTATOES, THE ASSESSEE HAD PREPARED HIS ACCOUNT FRO M M/S SANJAY KUMAR SALIM AHMED, COMMISSION AGENT THROUGH WHOM THE POTATOES W ERE SOLD BY THE ASSESSEE. IN RESPECT OF SOURCE OF CASH DEPOSIT IN THE BANK ACCOU NT OF THE ASSESSEE, AN AFFIDAVIT EXPLAINING THE SOURCE OF SUCH CASH DEPOSIT WAS FURN ISHED. THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT DURING THE COURSE OF PROCEE DINGS NEITHER THE ASSESSING OFFICER NOR THE CIT(A) HAD EVER REQUIRED THE ASSESSEE TO FU RNISH SUCH DOCUMENTS. THE LD.CIT(A) HAD DECIDED THE APPEAL AGAINST THE ASSESS EE WITHOUT GIVING SUFFICIENT OPPORTUNITY TO ADDUCE FURTHER EVIDENCES. SINCE THES E ADDITIONAL EVIDENCES GO TO THE ROOT OF THE MATTER FOR DECIDING THE ISSUES INVOLVED , THEREFORE, HE REQUESTED THAT THESE ADDITIONAL EVIDENCES BE ADMITTED AND THE APPEAL BE DECIDED ON THE BASIS OF SUCH ADDITIONAL EVIDENCES. 6. THE LD. DR, ON THE OTHER HAND, HEAVILY RELIED ON THE ORDER OF THE ASSESSING OFFICER AND THE CIT(A). HE SUBMITTED THAT THE ASSES SEE HAD NOT SUBSTANTIATED THE CASH DEPOSIT IN THE BANK ACCOUNT, THE GIFT RECEIVED AND THE AGRICULTURAL INCOME FROM SALE OF POPLAR TREES. THE LD. CIT(A) HAD GIVEN VALID REASO NS WHILE DECIDING THE ISSUE AGAINST THE ASSESSEE. SO FAR AS THE ADDITIONAL EVIDENCES A RE CONCERNED, HE SUBMITTED THAT THE ASSESSEE HAS NOT PROPERLY EXPLAINED AS TO WHY HE DI D NOT FILE THESE EVIDENCES BEFORE ITA NO.5181/DEL/2018 5 THE LOWER AUTHORITIES. HE ACCORDINGLY SUBMITTED TH AT THE ORDER OF THE CIT(A) BE UPHELD AND THE GROUNDS RAISED BY THE ASSESSEE BE DI SMISSED. IN HIS ALTERNATE CONTENTION, HE SUBMITTED THAT THE MATTER MAY BE RES TORED TO THE FILE OF THE ASSESSING OFFICER WITH A DIRECTION TO VERIFY THESE ADDITIONAL EVIDENCES AND DECIDE THE ISSUE AS PER FACT AND LAW. 7. I HAVE CONSIDERED THE RIVAL ARGUMENTS MADE BY BO TH THE SIDES AND PERUSED THE ORDERS OF THE AUTHORITIES BELOW. I HAVE ALSO CONSID ERED THE PAPER BOOK FILED ON BEHALF OF THE ASSESSEE. I FIND THE ASSESSING OFFICER, IN T HE INSTANT CASE, HAD MADE ADDITION OF RS.7,83,050/- AS INCOME FROM OTHER SOURCES DISREG ARDING THE CONTENTION OF THE ASSESSEE THAT SUCH INCOME IS A CAPITAL RECEIPT. SIM ILARLY, THE ASSESSING OFFICER MADE ADDITION OF RS.8,60,000/- SINCE THE ASSESSEE COULD NOT EXPLAIN THE AGRICULTURAL STOCK OF RS.8,60,000/- REFLECTED BY HIM IN THE BALANCE SHEET AS ON 31.03.2013 WITH SUPPORTING DOCUMENTARY EVIDENCE. THE ASSESSING OFFICER ALSO M ADE ADDITION OF RS.2,50,500/- OUT OF THE GIFT OF RS.4,50,000/- RECEIVED FROM HIS MOTH ER AS UNEXPLAINED CASH CREDIT IN THE BANK ACCOUNT U/S 69 OF THE IT ACT. IT IS THE SUBMI SSION OF THE LD. COUNSEL FOR THE ASSESSEE THAT IN VIEW OF THE ADDITIONAL EVIDENCES F ILED BY HIM TO SUBSTANTIATE THE SALE OF POPLAR TREES, THE AGRICULTURAL STOCK OF RS.8,60,000 /- AND THE GIFT RECEIVED FROM MOTHER, THESE ADDITIONAL EVIDENCES SHOULD BE ADMITTED SINCE THEY GO TO THE ROOT OF THE MATTER. CONSIDERING THE TOTALITY OF THE FACTS OF THE CASE A ND IN THE INTEREST OF JUSTICE, I ADMIT THE ADDITIONAL EVIDENCES SO FILED BEFORE ME AND RESTORE THE ISSUE TO THE FILE OF THE ASSESSING OFFICER WITH A DIRECTION TO GO THROUGH TH E SAME AND DECIDE THE ISSUE AS PER ITA NO.5181/DEL/2018 6 FACT AND LAW, AFTER GIVING DUE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. THE GROUNDS RAISED BY THE ASSESSEE ARE ACCORDINGLY ALLOWED FOR STATISTICAL PURPOSES. 8. IN THE RESULT, THE APPEAL FILED BY THE ASS ESSEE IS PARTLY ALLOWED FOR STATISTICAL PURPOSES. THE DECISION WAS PRONOUNCED IN THE OPEN COURT ON 0 1.10.2019. SD/- (R.K. PANDA) ACCOUNTANT MEMBE R DATED: 1 ST OCTOBER, 2019. DK COPY FORWARDED TO : 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR ASSTT. REGISTRAR, ITAT, NEW DELHI