INCOME TAX OFFICER, WARD 20(2)(1), MUMBAI V. SHRI JAYESH KEWALCHAND JAIN, MUMBAI

ITA 5640/MUM/2017

• Counselvise Citation: [2019] 116 COUNSELVISE.COM (IT) 7017 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 10 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-07-2019
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: F
• Assessment Year: 2013-2014
• Appeal Filed On: 05-09-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAJEEV GUBGOTRA
• Keywords: Additional evidence; Retraction
• Section: 271(1)(c); 143(3); 142(1); 234B; 143(2); 69A; 69

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL F, BENC H MUMBAI BEFORE SHRI PAWAN SINGH, JM & SHRI G. MANJUNATHA, AM ITA NO.5640/MUM/2017 ( ASSESSMENT YEAR :2013-14 ) ITO, WARD-20(2)(1) ROOM NO.216, PIRAMAL CHAMBER LLBAUG, MUMBAI-400 012 VS. JAYESH KEWALCHAND 401, SHANTI KUNJ CO.OP SOC. NAIGAON CROSS ROAD DADAR (E), MUMBAI-400 014 PAN/GIR NO. AA CPJ4527B APPELLANT ) .. RESPONDENT ) ASSESSEE BY SHRI SURESH PATNI REVENUE BY SHRI RAJEEV GUBGOTRA DATE OF HEARING 08/07/2019 DATE OF PRONOUNCEME NT 31 /07/2019 / O R D E R PER G.MANJUNATHA (A.M) : THIS IS AN APPEAL FILED BY THE REVENUE IS DIRECTED AGAINST ORDER OF THE COMMISSIONER OF INCOME TAX APPEALS 32, MUMBAI DATED 27/06/2017 AND IT PERTAINS TO THE ASSESSMENT YEAR 2 013-14. THE REVENUE HAS RAISED FOLLOWING THE GROUNDS OF APPEAL:- ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) ERRED IN THE GRANTING RELIEF WITH REGARDS TO THE ADDITIONS MADE IN THE HANDS OF THIRD PARTY OF THE IT ACT, 1961 IGN ORING THE FACTS THAT THE AMOUNT OF RS. 1 CRORE ALLEGED TO HAVE BEEN PAID IN CASH BELONGS TO THE ASSESSEE 2. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSE E IS AN INDIVIDUAL FILED HIS RETURN OF INCOME FOR AY 2013-14 ON 31/10/2013 D ECLARING TOTAL INCOME OF RS. 12,37,820/. THE CASE WAS SELECTED FOR SCRUTI NY AND NOTICES U/S. ITA NO.5640/MUM/2017 JAYESH KEWALCHAND JAIN 2 143(2) AND 142(1) OF THE ACT, WERE ISSUED. IN RESPO NSE TO THE NOTICES, THE AUTHORIZED REPRESENTATIVE FOR ASSESSEE APPEARED FRO M TIME TO TIME AND FILED VARIOUS DATES, AS CALLED FOR. DURING THE COUR SE OF ASSESSMENT PROCEEDINGS, THE AO NOTICED THAT THERE WAS INFORMAT ION FROM DDIT (INV.) THAT THE ASSESSEE HAS MADE CASH PAYMENT OF RS.100 L ACS TO M/S NISH DEVELOPERS P.LTD AGAINST BOOKING OF FLAT. THE AO FU RTHER OBSERVED THAT STATEMENTS WERE ACCORDED ON OATH FROM MR. KAILASH A GARWAL, CEO OF NISH DEVELOPER AND MR. PRAVEEN MISHRA, TRUSTED EMPL OYEE OF THE CONCERN WHERE THEY HAVE ADMITTED RECEIPT OF CASH FOR BOOKIN G OF FLAT FROM THE ASSESSEE. ON THE BASIS OF INFORMATION RECEIVED FROM DDIT (INV.), THE AO, CALLED UPON THE ASSESSEE TO EXPLAIN AS TO WHY CASH PAYMENT OF RS. 1 CRORE PAID TO M/S NISH DEVELOPER FOR BOOKING FLAT S HALL NOT BE TREATED AS UNEXPLAINED MONEY. IN RESPONSE TO SHOW CAUSE NOTICE , THE ASSESSEE STATED THAT HE HAS NEITHER PAID CASH NOR THE BUILDE R HAS ADMITTED THAT THEY HAVE RECEIVED CASH FOR BOOKING FLAT. ALTHOUGH, ONE OF EMPLOYE OF THE BUILDER ADMITTED IN STATEMENT REGARDED DURING SEARC H THAT THE COMPANY HAS RECEIVED CASH FOR BOOKING OF FLATS, BUT THERE W AS NO SPECIFIC MENTION ABOUT THE NAME OF THE ASSESSEE. IT WAS FURTHER SUBM ITTED THAT A LETTER FROM M/S NISH DEVELOPERS HAS BEEN RECEIVED WHERE THEY HA VE CATEGORICALLY STATED THAT NO CASH HAS BEEN RECEIVED FOR BOOKING F LAT, THEREFORE, THE QUESTION OF MAKING ADDITIONS TOWARDS CASH PAYMENT U /S 69A OF THE ACT DOES NOT ARISE. ITA NO.5640/MUM/2017 JAYESH KEWALCHAND JAIN 3 3. THE AO AFTER CONSIDERING RELEVANT SUBMISSIONS OF THE ASSESSEE AND ALSO BY RELIED UPON STATEMENT RECORDED FROM CEO OF M/S NISH DEVELOPERS P.LTD., CAME TO THE CONCLUSION THAT THE ASSESSEE HA S FAILED TO BRING ON RECORD THE SOURCE OF CASH OF RS. 1 CRORE PAID TO T HE M/S NISH DEVELOPERS P.LTD. ON 02/06/2012,16/06/2012, 22/08/2012 AND ON 06/09/2012, HE THEREFORE, MADE ADDITIONS OF RS. 1 CRORE U/S 69 A O F THE I.T. ACT, 1961. THE RELEVANT FINDINGS OF THE AO ARE AS UNDER:- 4.3 THE LETTER FROM M/S NISH DEVELOPERS PVT. LTD, IS CAREFULLY CONSIDERED. AT THE LETTER. IT CAN BE SEEN THAT M/S NISH DEVELOPERS PVT. LTD HA S NOT REJECTED THAT THE CASH IS RECEIVED BY IT. IT ONLY SAYS THAT THE IT HA S NOT RECORDED ANY ENTRY FOR PAYMENT OF ANY CASH AMOUNTING TO RS.1,00,00,000 /- FROM ,THE ASSESSES IN THEIR BOOKS OF ACCOUNTS. IT FURTHER CON FIRMS THAT IT HAS TILL DATE RECEIVED A SUM OF RS.1,47,75,002/- FROM THE ASSESSE S TOWARDS THE BOOKING / PURCHASE OF FLAT------IT FURTHER CONFIRMS THAT THE ENTIRE PROCEEDS OF RS.1,47,75,002/- RECEIVED BY THEM TILT DATE HAVE BEEN ONLY THROUGH REGULAR BANKING CHANNELS.., 4.4 FROM THE ABOVE, IT CAN BE NOTICED THAT THE CONC ERN, M/S NISH DEVELOPERS PVT- LTD, CONFIRMS ONLY THE LEGAL RECEIP TS AND DID NOT DENY THE CASH RECEIPTS WHICH IS THE MAIN ISSUE IN THIS PROCE EDINGS. THE RECEIPTS OF THE CASH HAS ALREADY BEEN ACCEPTED BY THE CONCERN D URING THE SEARCH ACTION BY THE DEPARTMENT THUS THE ASSESSEE'S CONTEN TION THAT HE HAS NOT MADE ANY CASH PAYMENT TO M/S NISH DEVELOPERS PVT LT D IS NOR CORRECT. FROM THE STATEMENT WHICH IS PRODUCED BY THE ASSESSES DURING THE ASSESSMENT PROCEEDINGS, IT IS NOT PROVED THAT THE N O CASH TRANSACTION IS INVOLVED AGAINST THE PURCHASE OF FLAT. 4.5. IT IS THEREFORE, CLEAR THAT THE CASH HAS BEEN GIVEN BY THE ASSESSEE TO M/S NISH DEVELOPERS PVT, LTD. THE ASSESSES HAS FAIL ED TO BRING ON RECORD THE SOURCE OF THE CASH OF RS, 1,00,00,000/- PAID TO M/S NISH DEVELOPER PVT. LTD. ON 2/06/2012, 16/6/2012, 22/08/2012 AND O N 6/9/2012. THEREFORE, I ADD RS.1,00,00,000/- LO THE INCOME OF THE ASSESSEE U/S.69A OF THE ACT, PENALTY U/S. 271(1)(C) IS INITIATED FOR CONCEALMENT OF INCOME. 4. SUBJECT TO THE ABOVE, THE INCOME OF THE ASSESS EE IS ASSED AS BELOW: PROFITS FROM BUSINESS RS.13,48,560/- INCOME FROM OTHER SOURCES RS. 7,751/- ADD: INCOME OF WHICH SOURCE IS NOT KNOWN RS.1,00,00 ,000/- GROSS TOTAL INCOME RS.1,13,56,311/- LESS CHP. VIA DEDUCTION RS. 1,18,487/- NET TAXABLE INCOME RS.1,12,37,824/- ITA NO.5640/MUM/2017 JAYESH KEWALCHAND JAIN 4 ASSESSED U/S 143(3) OF THE INCOME-TAX ACT, 1961. GI VE CREDIT FOR PREPAID TAXES AFTER DUE VERIFICATION. CHARGE INTEREST U/S 2 34A, 234B & 234C AS APPLICABLE. ISSUE DEMAND NOTICE/CHALLAN ACCORDINGLY . CALCULATION SHEET I.T.N.S.-150 ENCLOSED IS MADE PART OF THIS ORDER. I SSUE NOTICE U/S274 R.W.S. 27L(L)(C) FOR CONCEALMENT OF INCOME. 4. AGGRIEVED BY THE ASSESSMENT ORDER, THE ASSESSEE PREFERRED AN APPEAL BEFORE THE CIT(A). BEFORE THE CIT(A), THE A SSESSEE HAS FILED DETAILED RETURN SUBMISSIONS ON THIS ISSUE WHICH HAS BEEN REPRODUCED AT PARA NO.4 OF PAGE NO. 3 TO 7 OF LD. CIT(A) ORDER. T HE SUM AND SUBSTANCE OF ARGUMENTS OF THE ASSESSEE BEFORE THE LD. CIT(A) ARE THAT HE HAS NEITHER PAID CASH NOR THE DEVELOPER HAS ADMITTED OF HAVING RECEIVING CASH FOR BOOKING FLAT. ALTHOUGH, THERE WAS A STATEMENT F ROM ONE EMPLOYEE, BUT SUCH STATEMENT HAS BEEN SUBSEQUENTLY RETRACTED BY F ILING AFFIDAVIT. THEREFORE, THE SAME CANNOT BE TAKEN AS CONCLUSIVE E VIDENCE. THE ASSESSEE FURTHER SUBMITTED THAT AS PER AGREEMENT BE TWEEN M/S. NISH DEVELOPERS PVT.LTD. AND THE ASSESEE , THE AGREED PR ICE FOR PURCHASE OF FLAT IS AT RS. 2,75,00,000/-. THE MARKET VALUE OF T HE FLAT AS ON THE DATE OF AGREEMENT WAS AT RS. 2,72,20,000/- THEREFORE, IT IS HIGHLY INCORRECT ON THE PART OF THE AO TO HOLD THAT CASH HAS BEEN PAID FOR BOOKING FLAT. 5. THE CIT(A) AFTER CONSIDERING RELEVANT SUBMISSIO NS OF THE ASSESSEE AND ALSO TAKEN INTO ACCOUNT ADDITIONAL EVIDENCE FIL ED BY THE ASSESSEE CAME TO THE CONCLUSION THAT WHEN THE PERSON WHO GAV E STATEMENT U/S 132(4), RETRACTED FROM HIS ADMISSION BY FILING A SW ORN AFFIDAVIT, THE AO ITA NO.5640/MUM/2017 JAYESH KEWALCHAND JAIN 5 WAS ERRED IN REACHING TO THE CONCLUSION THAT THE A SSESSEE HAS PAID CASH FOR BOOKING FLAT. THE LD.CIT(A) FURTHER OBSERVED TH AT WHEN THE ASSESSEE HAS SPECIFICALLY ASKED FOR COPIES OF STATEMENTS, WH ICH THE AO HAS HEAVILY RELIED UPON AND ALSO SOUGHT, CROSS-EXAMINATION OF T HE PERSON WHO GAVE STATEMENT, THE AO IS DUTY BOUND TO PROVIDE COPIES O F STATEMENT AND ALSO ALLOWS CROSS EXAMINATION. SINCE, THE AO HAS NOT COM PLIED WITH REQUIREMENT OF PRINCIPLE OF NATURE JUSTICE AND ALSO FACT THAT THE PERSON WHO GAVE STATEMENT HAS BEEN SUBSEQUENTLY RETRACTED FROM HIS STATEMENT NO ADVERSE INFERENCE COULD BE DRAWN IN RESPECT OF CASH PAYMENTS FOR BOOKING FLATS. ACCORDINGLY, DELETED ADDITIONS MADE WITH AO TOWARDS CASH PAYMENT TO M/S NISH DEVELOPERS P.LTD. FOR BOOKING F LATS. THE RELEVANT FINDINGS OF THE CIT(A) ARE AS UNDER:- 5, DECISLON: DECISION: I HAVE CONSIDERED THE FACTS OF THE CASE , GROUNDS OF APPEAL, ORAL & WRITTEN SUBMISSIONS MADE BEFORE ME. AFTER A CAREFUL CONSIDERATION OF THE SAME AS WELL AS THE AS SESSMENT ORDER, I PROCEED TO RULE AS UNDER. 5.1 IN THIS CASE ADDITION RS. 1,00,00,000/- U/S 69 A OF THE IT ACT WAS MADE BY THE AO ON THE BASIS OF INFORMATION RECEIVED FROM DDIT (INV), MUMBAI. THE INFORMATION WAS FORWARDED BY THE DDIT ( INV), MUMBAI THAT IN THIS CASE APPELLANT WAS ALLEGED TO CASH PAYMENT OF RS. 1,00,00,000/- TOR PURCHASE OF FLATS AT 'ONE AVIGHNA PARK, ON TH E BASIS OF STATEMENT RECORDED OF MR, KAILASH AGARWAL, THE CEO OF M/S 'NI SH DEVELOPERS AND MR, PRAVIN MISHRA, A HOUSE KEEPING EMPLOYEE OF THE BUILDER, 5,2 THE APPELLANT HAS BOOKED FLAT IN A UNDER C ONSTRUCTION BUILDING IN THE PROJECT NAME 'ONE AVIGHNA PARK' BEING CONSTRUCT ED BY M/S NISH DEVELOPERS PVT. LTD, AT AGREED PURCHASE PRICE OF RS . 2,75,00,000/-AT THE TIME OF BOOKING. THE APPELLANT MADE PAYMENT OF RS. 5,00,000/-BEING BOOKING AMOUNT BY CHEQUE NO. 438420 DATED 31/10/201 0 DRAWN ON DENA BANK, THE APPELLANT MADE FURTHER PAYMENT OF RS, 20, 00,000/-BY CHEQUE NO. 237228 DATED 30/12/2011 DRAWN ON DENA BANK AND FURTHER PAYMENT OF RS. 12,50,000/- BY CHEQUE NO. 242130 DATED 25/04 /2012 DRAWN ON DENA BANK. IN ALL THE APPELLANT HAD MADE A TOTAL PA YMENT OF RS. 37,50,000/- UP TO 31/03/2013 AGAINST THE BOOKIN G AND ALLOTMENT OF ITA NO.5640/MUM/2017 JAYESH KEWALCHAND JAIN 6 THE SAID FLAT. THE APPELLANT'S WIFE, WHO IS A JO INT OWNER, ALSO CONTRIBUTED THE SAME AMOUNT. THE AGREEMENT FOR PURCHASE OF THE SAID FLAT WAS EXECUTED ON 24/12/2013 AND MARKET VALUE OF THE SAID FLAT HAS BEEN DETERMINED BY THE REGISTRAR AT RS. 2,72,20,000/- FO R THE PURPOSE OF STAMP DULY. WHEN THE MARKET VALUE OF A FLAT WHICH WAS AGR EED TO BE PURCHASED IN 2010 FOR A PURCHASE PRICE OF RS. 2,75,00,000/- I S DETERMINED AFTER MORE THAN 3 YEARS BY THE SUB-REGISTRAR AT RS. 2,72,20,00 0/-, THERE IS NO REASON OF MAKING ANY CASH PAYMENT OR ON MONEY AS ALLEGED B Y THE AO. THE APPELLANT ALSO FURNISHED THE COPY OF CORRESPONDENCE LETTER WITH BUILDER WHEREIN BUILDER CLEARLY DENIED RECEIVING ANY 'ON MO NEY. THE MARKET VALUE DETERMINED BY THE SUB-REGISTRAR FOR STAMP-DUT Y PURPOSES IS LESS THAN THE PURCHASE CONSIDERATION WHICH PROVES THAT T HERE IS ABSOLUTELY NO SCOPE FOR ON-MONEY IN THIS TRANSACTION OF PURCHASE OF FLAT. THE AO HAS MADE ADDITION OF RS.100 LAKHS WITHOUT ANY EVIDENCE EXCEPT THE ALLEGED SUBMISSION OF ONE MR. PRAVIN MISHRA, WHICH HAS SUBS EQUENTLY BEEN WITHDRAWN BY THE BUILDER. 5.3 IN SUPPORT OF HIS CLAIM THE APPELLANT FIFED COP Y OF AGREEMENT AND DETAILS OF PAYMENT MADE REGARDING PURCHASE OF FLAT. THE AGREEMENT FOR PURCHASE OF THE FLAT WAS EXECUTED ON 24/12/2013 FOR A TOTAL AGREED PURCHASE CONSIDERATION OF RS. 2,75.00,000/-. FROM T HE REGISTRATION RECEIPT DATED 26/12/2013 OF THE SAID FLAT I FIND THAT THE M ARKET VALUE DETERMINED BY THE SUB-REGISTRAR FOR STAMP DUTY PURPOSE WAS RS. 2,72,20,000/- WHICH IS LESS THAN PURCHASE PRICE AND PAYMENT WAS MADE TH ROUGH BANKING CHANNEL. THEREFORE, QUESTION TO PAY CASH FOR ON MON EY DOES NOT ARISE, 5.4 MR. KAILASH AGARWAL, THE CEO OF M/S NISH DEVELO PERS HAS RETRACTED THE STATEMENTS RECORDED BY THE SEARCH PARTY BY TILI NG A SWORN ''AFFIDAVIT' WHICH IS KEPT ON RECORD. MR. PRAVIN MISHRA, THE ALL EGED EMPLOYEE HAS ALSO FILED A SWORN 'AFFIDAVIT TO THE DY.CIT, CENTR AL CIRCLE 6(3), MUMBAI AND RETRACTED THE STATEMENTS RECORDED BY THE SEARCH PARTY 5.5 I RELY ON THE DECISION OF THE HON'BLE SUPREME C OURT IN THE CASE OF KISHANCHAND CHELLARAM V. CIT[1980]125 ITR 713 (SC). MOREOVER, THE STATEMENTS SO RECORDED HAVE BEEN RETRACTED BY A SWO RN AFFIDAVIT AND HENCE THE RELIANCE ON SUCH STATEMENTS COULD NOT HAV E BEEN MADE FOR THE PURPOSE OF MAKING AN ADDITION IN THE HANDS OF AT HI RD PARTY. 5.6 THE ADDITION OF RS. 1 CRORE WAS MADE PURELY ON THE BASIS OF SUSPICION, SURMISES AND CONJECTURE. THE ADDITION HA S BEEN MADE BY THE AO WITHOUT CONDUCTING ANY INDEPENDENT ENQUIRY AND S OLELY RELYING ON THE INFORMATION RECEIVED FROM DDIT. THERE IS NO EVIDENC E OR MATERIAL TO SUPPORT THE FINDING OF THE A.O. THAT THY SUM OF RS. 100 LAKHS ALLEGED TO HAVE BEEN PAID IN CASH BY THE APPELLANT. THE A.O. R ELIED UPON ONLY ON THE STATEMENT OF MR.PRAVIN MISHRA FOR THE PURPOSE OF MA KING ADDITION WHICH HAS ALSO BEEN WITHDRAWN SUBSEQUENTLY. THUS THERE IS NO EVIDENCE FOR THE CONCLUSION THAT THE AMOUNT OF RS.100 LAKHS ALLEGED TO HAVE BEEN PAID IN CASH BELONGS 10 THE APPELLANT. THEREFORE I HAVE NO HESITATION TO DELETE THE ADDITION OF RS, 100 LAKHS. THUS, THIS GROUND OF APPEAL IS ALLOWED. ITA NO.5640/MUM/2017 JAYESH KEWALCHAND JAIN 7 6. THE LD. DR SUBMITTED THAT THE LD. CIT(A) WAS ERR ED IN DELETING ADDITIONS MADE IN THE HANDS OF THE ASSESSEE IN RESP ECT OF CASH PAYMENTS FOR BOOKING FLATS IGNORING THE FACTS THAT AMOUNT O F RS. 1 CRORE HAS BEEN PAID IN CASH BELONGS TO THE ASSESSE. THE LD. DR FUR THER SUBMITTED THAT THE AO HAS BROUGHT OUT CLEAR FACTS IN LIGHT OF STAT EMENT RECORDED FROM CEO OF M/S NISH DEVELOPERS P.LTD. AND A TRUSTED EMP LOYEE, WHERE THEY HAVE CATEGORICALLY ADMITTED OF HAVING RECEIPT OF CA SH FOR BOOKING FLATS. THE SUBSEQUENT RETRACTION STATEMENT IS ONLY A SELF SERVING DOCUMENT AND THERE CANNOT BE ANY CREDIBILITY ATTACHED TO SUBSEQU ENT CORRESPONDENCE, THUS, THE RETRACTION HAS NO VALUE UNLESS THE ASSESE E PROOVES THAT HOW IT IS NOT A VALID STATEMENT. 7. THE LD.AR FOR THE ASSESSEE, ON THE OTHER HAND, S TRONGLY SUPPORTING ORDER OF THE CIT(A) SUBMITTED THAT THE CIT(A) HAS R IGHTLY DELETED THE ADDITIONS MADE TOWARDS CASH PAYMENTS FOR BOOKING FL AT, WHEN THE ASSESSEE HAS EXPLAINED WITH NECESSARY EVIDENCES THA T NO CASH HAS BEEN EXCHANGED BETWEEN THE PARTIES IN RESPECT OF BOOKING FLAT. THE LD. AR FURTHER SUBMITTED THAT THE ASSESSEE HAS FILED AN AG REEMENT BETWEEN THE PARTIES AS PER WHICH THE VALUE OF THE FLAT AS PER M ARKET RATE IS LESS THAN THE AGREEMENT VALUE WHICH IS EVIDENT FROM THE FACT THAT THE SALE DEED EXECUTED ON 24/12/2013 IS CATAGORICALLY PROVES THAT MARKET VALUE OF THE SAID FLAT HAS BEEN DETERMINED BY THE REGISTRAR AT R S. 2,72,20,000/-. FURTHER, THE PERSON WHO GAVE STATEMENT HAS BEEN RET RACTED FROM SUCH STATEMENT WITH SWORN AFFIDAVIT AND STATED THAT NO C ASH HAS BEEN RECEIVED ITA NO.5640/MUM/2017 JAYESH KEWALCHAND JAIN 8 FOR BOOKING FLAT. UNDER THESE FACTS, THE CIT(A) RIG HTLY REACHED TO THE CONCLUSION THAT THE AO HAS MADE ADDITIONS WITHOUT C ONDUCTING ANY INDEPENDENT ENQUIRY AND SOLELY RELYING ON THE INFOR MATION RECEIVED FROM DDIT (INV.) AND HENCE, ORDER OF THE CIT(A) SHOULD B E CONFIRMED. 8. WE HAVE HEARD BOTH THE PARTIES, PERUSED MATERIAL AVAILABLE ON RECORD AND GONE THROUGH ORDERS OF THE AUTHORITIES B ELOW. THE AO HAS MADE ADDITIONS U/S 69A OF THE I.T. ACT, 1961 TOWARD S PURPORTED CASH PAYMENT OF RS. 1 CRORE TO M/S NISH DEVELOPERS P.LTD . FOR PURCHASE OF FLATS. THE AO HAS RELIED UPON INFORMATION RECEIVED FROM DD IT (INV.) AS PER WHICH THE CEO AND TRUSTED EMPLOYEE OF M/S NISH DEVE LOPERS P.LTD., IN THE STATEMENT RECORDED DURING SEARCH PROCEEDINGS HA VE ADMITTED THE FACT OF RECEIVING CASH FOR BOOKING OF FLATS. EXCEPT THIS , THE AO HAS NOT CARRIED OUT ANY INDEPENDENT ENQUIRY TO FIND OUT THE TRUTH I N LIGHT OF STATEMENT RECORDED FROM CEO OF M/S. NISH DEVELOPERS P.LTD. TO WARDS CASH PAYMENT MADE FOR BOOKINGS FLATS. ON THE OTHER HAND, THE ASS ESSEE HAS FILED AN AGREEMENT BETWEEN THE PARTIES AS PER WHICH THE AGRE ED PRICE FOR SAID FLAT WAS AT RS. 2,75,00,000/-. THE ASSESSEE HAS ALSO FIL ED COPY OF PURCHASE DEED WHICH WAS EXECUTED ON 24/12/2013 AND MARKET VA LUE OF THE SAID FLAT HAS BEEN DETERMINED BY THE REGISTRAR AT RS. 2,72,20 ,000/- FOR THE PURPOSE OF STAMP DUTY. WHEN THE MARKET VALUE OF THE FLAT WH ICH WAS AGREED TO BE PURCHASED IN 2010 FOR A PURCHASE OF PRICE RS. 2, 75 ,00,000/- IS DETERMINED AFTER MORE THAN THREE YEARS BY THE SUB R EGISTRAR AT RS. ITA NO.5640/MUM/2017 JAYESH KEWALCHAND JAIN 9 2,72,20,000/-, THERE IS NO REASON FOR THE AO TO MAK E ADDITIONS TOWARDS ALLEGED CASH PAYMENT ONLY ON THE BASIS STATEMENT O F SOME PERSONS, MORE PARTICULARLY WHEN THE PERSONS WHO GAVE SUCH ST ATEMENTS HAVE BEEN SUBSEQUENTLY RETRACTED STATEMENT BY FILING A SWORN AFFIDAVIT. THE LD.CIT(A) AFTER CONSIDERING RELEVANT FACTS AND ALSO BY FOLLOW ING THE DECISION OF HONBLE SUPREME COURT IN THE CASE OF SHRI. KISHANCHAND CHELLARAM VS. CIT (1980) (125 ITR 730) HELD THAT THE AO HAS MADE ADDITIONS WITHOUT CONDUCTING ANY INDEPENDENT ENQUIRY AND SOLELY ON TH E BASIS OF INFORMATION RECEIVED FROM DDIT (INV.) WITHOUT THERE BEING ANY FURTHER EVIDENCES TO SUPPORT HIS FINDINGS THAT A SUM OF RS. 100 LACS ALLEGED TO HAVE BEEN PAID IN CASH BY THE ASSESSEE. WE DO NOT F IND ANY ERROR IN THE FINDINGS OF CIT(A). HENCE, WE ARE INCLINED TO UPHOL D FINDINGS OF THE CIT(A) AND DISMISSED THE APPEAL FILED BY THE REVENUE. 9. IN THE RESULT, APPEAL FILED BY THE REVENUE IS DI SMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 31/07/2 019 SD/- (PAWAN SINGH) SD/- (G. MANJUNATHA) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI ; DATED 31/07/2019 THIRUMALESH SR.PS COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT. 3. THE CIT(A), MUMBAI. 4. CIT 5. DR, ITAT, MUMBAI 6. GUARD FILE. ITA NO.5640/MUM/2017 JAYESH KEWALCHAND JAIN 10 BY ORDER, (ASSTT. REGISTRAR) ITAT, MUMBAI //TRUE COPY//