DCIT, Chandigarh V. Sh. Surinder Singh Saini, Chandigarh

ITA 593/CHANDI/2017

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 5093 (ITAT-CHANDIGARH)
• Duration Of Justice: 2 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-06-2017
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: Not Allotted
• Assessment Year: 2009-2010
• Appeal Filed On: 05-04-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S K MITTAL
• Keywords: Question of law; Fair market value
• Section: 132; 2

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DIVISION BENCH, CHANDIGARH BEFORE SHRI SANJAY GARG, JUDICIAL MEMBER AND MS. ANNAPURNA GUPTA, ACCOUNTANT MEMBER ITA NO. 593/CHD/2017 ASSESSMENT YEAR: 2009-10 THE DCIT VS. SH. SURINDER SINGH SAINI CENTRAL CIRCLE I PROP. M/S SURINDRA BUILDERS CHANDIGARH H.NO. 1183, SECTOR 8 CHANDIGARH PAN NO. AFCPS819 6L (APPELLANT) (RESPONDENT) APPELLANT BY : SH. S.K. MITTAL RESPONDENT BY : SH. ATUL GOYAL DATE OF HEARING : 31/05/2017 DATE OF PRONOUNCEMENT : 23/06/2017 ORDER PER ANNAPURNA GUPTA A.M. THE PRESENT APPEAL IS DIRECTED AGAINST THE ORDER OF THE LD. CIT(A)- GURGAON DELETING THE LEVY OF PENALTY UNDER SECTION 271(1)(C) OF THE INCOME TAX ACT 1961. 2. THE REVENUE HAS RAISED THE FOLLOWING GROUNDS: 1. WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE C ASE THE LD. CIT(A) HAS ERRED IN DELETING THE PENALTY EVE THE ASSESSEE FAIL ED TO GIVE ANY SATISFACTORY EXPLANATION WITH REGARD TO THE SUCH WITHDRAWAL OF R S. 40,60,000/- TOWARDS THE PURCHASE OF LAND/BUILDING DURING THE COURSE OF ASSE SSMENT PROCEEDINGS, PENALTY PROCEEDINGS AS WELL AS APPELLATE PROCEEDINGS BEFORE THE LD. CIT(A). 2. WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE C ASE THE LD. CIT(A) HAS ERRED IN GRANTING RELIEF TO ASSESSEE WHEN EVEN THE BASIC REQUIREMENT OF THE 2 SECTION 271(1)(C) IS NOT FULFILLED I.E. THE ASSESSE E FAILED TO EXPLAIN THE SOURCE OF SUCH PAYMENTS / INVESTMENTS / EXPENDITURE AND NOR H AVE GIVEN ANY DOCUMENTARY EVIDENCE. 3. BRIEF FACTS RELATING TO THE CASE ARE THAT SEARC H UNDER SECTION 132(1) WAS CONDUCTED ON MEHTA & ZENDAR GROUP OF CASES ON 18/02 /2011 AND THE ASSESSEE SHRI. SAINI WAS ONE OF THE PERSONS COVERED UNDER SE CTION 132 OF THE INCOME TAX ACT 1961. NOTICE UNDER SECTION 153 A OF THE ACT WAS ISSUED TO THE ASSESSEE AND THEREAFTER ASSESSMENT FRAMED FOR THE IMPUGNED YEAR WHEREBY AN ADDITION OF RS. 40,60,000/- WAS MADE ON ACCOUNT OF UNSATISFACTORY E XPLANATION GIVEN BY THE ASSESSEE WITH REGARD TO THE SOURCE OF CASH INVESTME NT. PENALTY PROCEEDING UNDER SECTION 271(1)(C) WERE ALSO INITIATED VIDE AB OVE SAID ASSESSMENT ORDER. IN THE MEANWHILE THE APPEAL OF THE ASSESSEE AGAINST TH E QUANTUM ORDER PASSED WAS DECIDED BY THE LD. CIT(A) DISMISSING THE ASSESS EES APPEAL. THEREAFTER PENALTY WAS LEVIED BY THE AO FOR THE REASON THAT TH E ASSESSEE HAD FAILED TO GIVE ANY SATISFACTORY EXPLANATION WITH DOCUMENTARY EVIDE NCE THAT THE AMOUNT OF RS. 40,60,000/- WITHDRAW WERE TOWARDS THE PURCHASE OF L AND AND BUILDING PENALTY LEVIED AMOUNTING TO RS. 13,80,000/-. 4. THE MATTER WAS CARRIED IN APPEAL BEFORE THE LD. CIT(A) WHO DELETED THE PENALTY LEVIED. 5. AGGRIEVED BY THE SAME THE REVENUE NOW CAME UP IN APPEAL BEFORE US. 6. DURING THE COURSE OF HEARING LD. COUNSEL FOR THE ASSESSEE DREW OUR ATTENTION TO THE FACT THAT THE ITAT HAD DELETED THE ADDITION MADE OF RS.40,60,000/- ON WHICH THE PENALTY HAD BEEN LEVIED , IN THE QUANTUM 3 PROCEEDINGS BEFORE IT, VIDE ITS ORDER IN ITA NO. 10 4/CHD/2015 DT. 17/04/2017. LD. COUNSEL FOR THE ASSESSEE SUBMITTED THEREFORE THAT THERE WAS NO CASE FOR LEVY OF PENALTY AT ALL. 7. LD. DR ON THE OTHER HAND RELIED UPON THE ORDER O F THE AO THOUGH HE FAIRLY CONCEDED THAT THE ADDITION MADE HAD BEEN DELETED BY THE ITAT. 8. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE ORDERS OF THE AUTHORITIES BELOW AND ALSO THE DOCUMENTS REFERRED T O BEFORE US. 9. IT IS AN UNDISPUTED FACT THAT PENALTY IN THE PRE SENT CASE WAS LEVIED ON ACCOUNT OF ADDITION OF RS. 40,60,000/- MADE TO THE INCOME OF THE ASSESSEE UNDER SECTION 69B OF THE ACT ON ACCOUNT OF INVESTME NT MADE FROM ALLEGED UNEXPLAINED SOURCE. THE SAID ADDITION WE FIND HAS B EEN DELETED BY THE ITAT VIDE ITS ORDER DT. 17/04/2017 IN ITA NO. 104/CHD/20 17, WHEREIN IT WAS HELD AT PARA 8 TO 13 OF THE ORDER AS UNDER: 8. WE HAVE HEARD THE ARGUMENTS OF BOTH THE PARTIES , PERUSED THE ORDERS OF THE AUTHORITIES BELOW AND GON E THROUGH THE DOCUMENTS PLACED BEFORE US. THE UNDISPUTED FACTS I N THIS CASE ARE THAT THE ASSESSEE HAD MADE PAYMENT OF RS.3 CROR ES AS ADVANCE FOR PURCHASE OF DENTAL COLLEGE THROUGH ITS PRESIDENT DR.ZORA SINGH. OUT OF THE AFORESAID ADVANCE OF RS .3 CRORES, RS.1.60 CRORES WERE PAID IN CASH. THIS FACT HAS BE EN ADMITTED TO BY THE ASSESSEE AND IS NOT DISPUTED. THE ONLY ISSU E IS RELATING TO THE EXPLANATION OF THE SOURCE OF THE IMPUGNED CASH ADVANCED OF RS.1.60 CRORES, OF WHICH AN AMOUNT OF RS.40,60,000/ - PERTAINS TO THE IMPUGNED YEAR, AND IN THE ABSENCE OF WHICH ADD ITION U/S 69B OF THE INCOME TAX ACT,1961 HAS BEEN MADE. 9. WE FIND MERIT IN THE ARGUMENTS OF THE LD.COUNSE L FOR THE ASSESSEE. SECTION 69B CALLS FOR ADDITIONS TO BE MADE OF INVESTMENTS NOT FULLY DISCLOSED IN THE BOOKS OF ACC OUNTS OF THE ASSESSEE. THE SAID SECTION STATES AS UNDER: AMOUNT OF INVESTMENTS, ETC., NOT FULLY DISCLOSED I N BOOKS OF ACCOUNT. 69B. WHERE IN ANY FINANCIAL YEAR THE ASSESSEE HAS MADE INVESTMENTS OR IS FOUND TO BE THE OWNER OF ANY BULL ION, JEWELLERY 4 OR OTHER VALUABLE ARTICLE AND THE ASSESSING OFFICER FINDS THAT THE AMOUNT EXPENDED ON MAKING SUCH INVESTMENTS OR IN AC QUIRING SUCH BULLION, JEWELLERY OR OTHER VALUABLE ARTICLE E XCEEDS THE AMOUNT RECORDED IN THIS BEHALF IN THE BOOKS OF ACCO UNT MAINTAINED BY THE ASSESSEE FOR ANY SOURCE OF INCOME , AND THE ASSESSEE OFFERS NO EXPLANATION ABOUT SUCH EXCESS AM OUNT OR THE EXPLANATION OFFERED BY HIM IS NOT, IN THE OPINION O F THE ASSESSING OFFICER, SATISFACTORY, THE EXCESS AMOUNT MAY BE DEE MED TO BE THE INCOME OF THE ASSESSEE FOR SUCH FINANCIAL YEAR. 10. IN THE PRESENT CASE THE IMPUGNED AMOUNT IS REF LECTED IN THE BALANCE SHEET OF THE ASSESSEE AS POINTED OUT TO US. LD DR HAS NOT CONTROVERTED THE SAME. THEREFORE, FOR THIS REASON ALONE THE ADDITION MADE SHOULD BE DELETED. 11. FURTHER, IN ANY CASE, WE FIND THAT THE ASSESSE E HAD EXPLAINED THE SOURCE OF CASH PAYMENT MADE BY WAY OF CASH WITHDRAWALS FROM ITS BANK ACCOUNT IN VIJAYA BANK. D ETAILS OF THE SAME WERE PLACED BEFORE THE LOWER AUTHORITIES AND A RE ALSO REPRODUCED IN THE ORDER OF THE CIT (APPEALS) AT PAG ES 3 TO 10. THE SAID DETAIL ADEQUATELY EXPLAIN THE AVAILABILITY OF CASH ON THE DATE ON WHICH CASH PAYMENT WAS MADE TO DR.ZORA SING H. THIS FACT STATED BY THE ASSESSEE AND DEMONSTRATED BEFORE THE LOWER AUTHORITIES, HAS NOT BEEN CONTROVERTED AT ANY STAGE EITHER BY THE ASSESSING OFFICER OR BY THE CIT (APPEALS) OR EVEN B Y THE LEARNED D.R. BEFORE US. NO INFIRMITY IN THE AFORESAID DETA ILS HAS BEEN POINTED OUT BY ANY OF THE AUTHORITIES. THEREFORE, IT CAN BE SAFELY STATED THAT THE ASSESSEE HAD DEMONSTRATED THE AVAIL ABILITY OF CASH WITH HIM AS BEING FROM WITHDRAWALS FROM HIS BA NK ACCOUNT FOR THE PURPOSE OF PAYMENT AS ADVANCE PAYMENT OF TH E DENTAL COLLEGE PURCHASE. FURTHER AS POINTED OUT BY THE LD . COUNSEL FOR THE ASSESSEE ALSO, WE FIND THAT THE ASSESSING OFFIC ER HAD GIVEN A CATEGORICAL FINDING THAT NO OTHER USE OF THE CASH W ITHDRAWN WAS EVIDENT FROM THE CASH BOOK. IN SUCH CIRCUMSTANCES, THERE IS NO REASON TO DISBELIEVE THE EXPLANATION OF THE ASSESSE E REGARDING THE SOURCE OF THE CASH PAID AS ADVANCE FOR THE PURP OSE OF DENTAL COLLEGE AMOUNTING TO RS.1.60 CRORES AS BEING FROM THE CASH WITHDRAWALS FROM THE BANK ACCOUNT OF THE ASSES SEE. THE ONLY REASON, POINTED OUT BY THE LD.DR, FOR DISBELIE VING THE EXPLANATION OF THE ASSESSEE WAS THAT THE WITHDRAWAL S WERE MADE IN SMALL AMOUNTS ON DIFFERENT DATES AS EARLY AS IN APRIL, 2008 WHILE THE AGREEMENT TOOK PLACE IN JULY, 2008. FOR THESE REASONS, THE EXPLANATION OF THE ASSESSEE WAS NOT BELIEVED SINCE IT COULD NOT BE IMAGINED AS TO WHY THE ASSESSEE WOULD RETAIN CAS H WITHDRAWN FOR A LONG PERIOD FOR MAKING PAYMENT IN FUTURE FOR A FUTURE DEAL. WE FIND NO MERIT IN THIS ARGUMENT OF THE REVENUE. THE FACT REMAINS THAT THE CASH WITHDRAWALS FROM THE BANK ACC OUNT EXPLAIN THE AVAILABILITY OF CASH PAYMENT OF ADVANC E. NO OTHER USE OF THE CASH WITHDRAWALS HAS EITHER BEEN BROUGHT ON RECORD BY THE ASSESSING OFFICER AND IN FACT, THE ASSESSING OFFICER HAS ADMITTED THAT NO OTHER USE WAS EVIDENT FROM THE CAS H BOOK ALSO. THE REASON FOR REJECTING THE EXPLANATION OF THE ASS ESSEE IS, THEREFORE, MERELY BASED ON SUSPICION WHICH CANNOT B E THE BASIS 5 FOR MAKING ANY ADDITION, TOTALLY IGNORING THE FACTS BEFORE US.THE RELIANCE PLACED BY THE LD.COUNSEL FOR THE ASSESSEE IN THE CASE OF CIT VS DINESH JAIN HUF (2013) 352 ITR 629(DELHI) IS APT WHEREIN THE HONBLE HIGH COURT HAS HELD THAT ADDITION U/S 69B C ANNOT BE MADE ON THE BASIS OF ASSUMPTIONS. THE RELEVANT FIND INGS OF THE HONBLE HIGH COURT ARE AS UNDER: 11.SECTION 69B DOES NOT PERMIT AN INFERENCE TO BE DRAWN FROM THE CIRCUMSTANCES SURROUNDING THE TRANSACTION THAT THE PURCHASER OF THE PROPERTY MUST HAVE PAID MORE THAN WHAT WAS ACTUALLY RECORDED IN HIS BOOKS OF ACCOUNT FOR THE SIMPLE REASON THAT SUCH AN INFERENCE COULD BE VERY SUBJECTIVE AND COULD INVOLVE THE DANGEROUS CONSEQUENCE OF A NOTIONAL OR FICTIONAL INCOME BEING BROUGHT TO TAX CONTRARY TO THE STRICT PROVISIONS OF ARTICLE 265 OF THE CONSTITUTION OF INDIA AND ENTRY 82 IN LIST I OF THE SEVENTH SCHEDUL E THERETO WHICH DEALS WITH 'TAXES ON INCOME OTHER THAN AGRICULTURAL INCOME'. THIS WAS ONE OF THE MAJOR CONSIDERATIONS THAT WEIGHED WITH THE SUPREME COURT IN K.P. VARGHESE (SUPRA) IN WHICH CASE THE PROVISIONS OF SUB-SECTION (2) OF SEC TION 52 FELL FOR INTERPRETATION. IT WAS OBSERVED THAT PARLIAMENT CANNOT CHOOSE TO TAX A S INCOME AN ITEM WHICH IN NO RATIONAL SENSE CAN BE REGARDED AS A CITIZENS IN COME OR EVEN RECEIPT. SECTION 52(2) (WHICH NOW STANDS OMITTED) APPLIED TO THE TRA NSFEROR OF PROPERTY FOR A CONSIDERATION THAT WAS LESSER THAN THE FAIR MARKET VALUE BY 15 PERCENT OR MORE; IN SUCH A CASE, THE ASSESSING OFFICER WAS CONFERRED THE POWER TO ADOPT THE FAIR MARKET VALUE OF THE PROPERTY AS THE SALE PRICE AND COMPUTE THE CAPITAL GAINS ACCORDINGLY. THE SUPREME COURT HELD THAT IT WAS THE BURDEN OF THE ASSESSING OFFICER TO PROVE THAT THERE WAS UNDERSTATEMENT OF CO NSIDERATION AND ONCE THAT BURDEN WAS DISCHARGED IT WAS NOT REQUIRED OF HIM TO PROVE THE PRECISE EXTENT OF UNDERSTATEMENT AND HE COULD ADOPT THE DIFFERENCE BE TWEEN THE STATED CONSIDERATION AND THE FAIR MARKET VALUE OF THE PROP ERTY AS THE UNDERSTATEMENT. THE SUB-SECTION WAS HELD TO PROVIDE FOR A 'STATUTOR Y BEST JUDGMENT' ONCE ACTUAL UNDERSTATEMENT WAS PROVED; IT OBVIATED THE NEED TO PROVE THE EXACT AMOUNT OF UNDERSTATEMENT. ADDITIONAL REASONS FOR THE RESULT W ERE (A) THAT THE MARGINAL NOTE TO THE SECTION REFERRED TO 'CASES OF UNDERSTATEMENT '; (B) THE SPEECH OF THE FINANCE MINISTER WHILE INTRODUCING THE PROVISION; A ND (C) THE ABSURD OR IRRATIONAL RESULTS THAT WOULD FLOW FROM A LITERAL INTERPRETATI ON OF THE SUB-SECTION, WHICH COULD NOT HAVE BEEN INTENDED BY THE LEGISLATURE. 12. WHILE THE OMITTED SECTION 52(2) APPLIED TO THE TRANSFEROR OF THE PROPERTY, SECTION 69B APPLIES TO THE TRANSFEREE - THE PURCHAS ER - OF THE PROPERTY. IT REFERS TO THE MONEY 'EXPENDED' BY THE ASSESSEE, BUT NOT RECOR DED IN HIS BOOKS OF ACCOUNT, WHICH IS A CLEAR REFERENCE TO UNDISCLOSED INCOME BEING USED IN THE INVESTMENT. APPLYING THE LOGIC AND REASONING IN K.P . VARGHESE (SUPRA) IT SEEMS TO US THAT EVEN FOR THE PURPOSES OF SECTION 69B IT IS THE BURDEN OF THE ASSESSING OFFICER TO FIRST PROVE THAT THERE WAS UNDERSTATEMENT OF THE CONSIDERATION (INVESTMENT) IN THE BOOKS OF ACCOUNT. ONCE THAT UNDE RVALUATION IS ESTABLISHED AS A MATTER OF FACT, THE ASSESSING OFFICER, IN THE ABSE NCE OF ANY SATISFACTORY EXPLANATION FROM THE ASSESSEE AS TO THE SOURCE OF T HE UNDISCLOSED PORTION OF THE INVESTMENT, CAN PROCEED TO ADOPT SOME DEPENDABLE OR RELIABLE YARDSTICK WITH WHICH TO MEASURE THE EXTENT OF UNDERSTATEMENT OF TH E INVESTMENT. ONE SUCH YARDSTICK CAN BE THE FAIR MARKET VALUE OF THE PROPE RTY DETERMINED IN ACCORDANCE WITH THE WEALTH TAX ACT. WE HOWEVER CLARIFY THAT TH IS COURT IS NOT CONCLUDING THAT SUCH YARDSTICK IS DETERMINATIVE; IN VIEW OF THE FIN DINGS ARRIVED AT BY US THAT THE ASSESSING OFFICER DID NOT GATHER FOUNDATIONAL FACTS TO POINT TO UNDERVALUATION THE ADOPTION OF THE NORMS UNDER THE WEALTH TAX ACT IS N OT COMMENTED UPON BY US. 6 13. THE ERROR COMMITTED BY THE INCOME-TAX AUTHORITI ES IN THE PRESENT CASE IS TO JUMP THE FIRST STEP IN THE PROCESS OF APPLYING SECT ION 69B - THAT OF PROVING UNDERSTATEMENT OF THE INVESTMENT - AND APPLY THE ME ASURE OF UNDERSTATEMENT. IF ANYTHING, THE LANGUAGE EMPLOYED IN SECTION 69B IS I N STRICTER TERMS THAN THE ERSTWHILE SECTION 52(2). IT DOES NOT EVEN AUTHORISE THE ADOPTION OF ANY YARDSTICK TO MEASURE THE PRECISE EXTENT OF UNDERSTATEMENT. THERE CAN THEREFORE BE NO COMPROMISE IN THE APPLICATION OF THE SECTION. IT WO ULD SEEM TO REQUIRE THE ASSESSING OFFICER EVEN TO SHOW THE EXACT EXTENT OF U NDERSTATEMENT OF THE INVESTMENT; IT DOES NOT EVEN GIVE THE ASSESSING OFFI CER THE OPTION OF APPLYING ANY REASONABLE YARDSTICK TO MEASURE THE PRECISE EXTENT OF UNDERSTATEMENT OF THE INVESTMENT ONCE THE FACT OF UNDERSTATEMENT IS PROVE D. IT APPEARS TO US THAT THE ASSESSING OFFICER IS NOT ONLY REQUIRED TO PROVE UNDE RSTATEMENT OF THE PURCHASE PRICE, BUT ALSO TO SHOW THE PRECISE EXTENT OF THE U NDERSTATEMENT. THERE IS NO AUTHORITY GIVEN BY THE SECTION TO ADOPT SOME REASON ABLE YARDSTICK TO MEASURE THE EXTENT OF UNDERSTATEMENT. BUT SINCE IT MAY NOT BE POSSIBLE IN ALL CASES TO PROVE THE PRECISE OR EXACT AMOUNT OF UNDISCLOSED IN VESTMENT, IT IS PERHAPS REASONABLE TO PERMIT THE ASSESSING OFFICER TO RELY O N SOME ACCEPTABLE BASIS OF ASCERTAINING THE MARKET VALUE OF THE PROPERTY TO AS SESS THE UNDISCLOSED INVESTMENT. WHETHER THE BASIS ADOPTED BY THE ASSESS ING OFFICER IS AN ACCEPTABLE ONE OR NOT MAY DEPEND ON THE FACTS AND CIRCUMSTANCE S OF THE PARTICULAR CASE. THAT QUESTION MAY HOWEVER ARISE ONLY WHEN ACTUAL UN DERSTATEMENT IS FIRST PROVED BY THE ASSESSING OFFICER. IT IS ONLY TO THIS EXTENT THAT THE RIGOUR OF THE BURDEN PLACED ON THE ASSESSING OFFICER MAY BE RELAXED IN CA SES WHERE THERE IS EVIDENCE TO SHOW UNDERSTATEMENT OF THE INVESTMENT, BUT EVIDE NCE TO SHOW THE PRECISE EXTENT THEREOF IS LACKING. 14. IN LALCHAND BHAGAT AMBICA RAM VS. COMMISSIONER OF INCOME TAX, BIHAR AND ORISSA (1959) 37 ITR 288, THE SUPREME COURT DISAPPR OVED THE PRACTICE OF MAKING ADDITIONS IN THE ASSESSMENTS ON MERE SUSPICION AND SURMISE OR BY TAKING NOTE OF THE NOTORIOUS PRACTICES PREVAILING IN TRADE CIRCLES . AT PAGE 299 OF THE REPORT, IT WAS OBSERVED AS FOLLOWS : 'ADVERTING TO THE VARIOUS PROBABILITIES WHICH WEIGH ED WITH THE INCOME-TAX OFFICER WE MAY OBSERVE THAT THE NOTORIETY FOR SMUGGLING FOO D GRAINS AND OTHER COMMODITIES TO BENGAL BY COUNTRY BOATS ACQUIRED BY SAHIBGUNJ AND THE NOTORIETY ACHIEVED BY DHULIAN AS A GREAT RECEIVING CENTRE FOR SUCH COMMODITIES WERE MERELY A BACKGROUND OF SUSPICION AND THE APPEL LANT COULD NOT BE TARRED WITH THE SAME BRUSH AS EVERY ARHATDAR AND GRAIN MER CHANT WHO MIGHT HAVE BEEN INDULGING IN SMUGGLING OPERATIONS, WITHOUT AN IOTA OF EVIDENCE IN THAT BEHALF. ' THIS TAKES CARE OF THE ARGUMENT OF MR. SABHARWAL TH AT JUDICIAL NOTICE CAN BE TAKEN OF THE PRACTICE PREVAILING IN THE PROPERTY MA RKET OF NOT DISCLOSING THE FULL CONSIDERATION FOR TRANSFER OF PROPERTIES. 15. SINCE THE ENTIRE CASE HAS PROCEEDED ON THE ASSU MPTION THAT THERE WAS UNDERSTATEMENT OF THE INVESTMENT, WITHOUT A FINDING THAT THE ASSESSEE INVESTED MORE THAN WHAT WAS RECORDED IN THE BOOKS OF ACCOUNT , WE ARE UNABLE TO APPROVE OF THE DECISION OF THE INCOME-TAX AUTHORITI ES. SECTION 69B WAS WRONGLY INVOKED. THE ORDER OF THE TRIBUNAL IS APPROVED; THE SUBSTANTIAL QUESTION OF LAW IS ANSWERED IN THE NEGATIVE, IN FAVOUR OF THE ASSESSEE AND AGAINST THE CIT. 12. IN VIEW OF THE SAME, WE HOLD THAT THE SOURCE O F CASH INVESTED BY WAY OF ADVANCE FOR PURCHASE OF DENTAL C OLLEGE STANDS EXPLAINED AND ADDITION MADE ON ACCOUNT OF TH E SAME FOR THE IMPUGNED YEAR UNDER SECTION 69B OF THE ACT AMOU NTING TO 7 RS.40,60,000/- IS, THEREFORE, DIRECTED TO BE DELETE D. SINCE WE HAVE DELETED THE ADDITION MADE, AGREEING WITH THE A RGUMENTS MADE ON MERIT BY THE LD. COUNSEL FOR THE ASSESSEE, WE FIND NO REASON TO DEAL WITH OTHER ARGUMENTS OF THE LD. COUN SEL FOR THE ASSESSEE AS IT BECOMES MERELY ACADEMIC IN NATURE. 13. IN VIEW OF THE ABOVE, GROUNDS OF APPEAL RAIS ED BY THE ASSESSEE IS ALLOWED. 10. IN VIEW OF THE ABOVE, SINCE THE ADDITION MADE I TSELF HAS BEEN DELETED ,THE VERY BASIS FOR LEVY OF PENALTY DOES NOT REMAIN.WE T HEREFORE UPHOLD THE ORDER OF THE LD.CIT(A) DELETING THE PENALTY LEVIED U/S 271(1 )(C) AMOUNTING TO RS.13,80,000/-. THE GROUNDS OF APPEAL RAISED BY THE REVENUE ARE THEREFORE DISMISSED. 11. IN THE RESULT APPEAL FILED BY THE REVENUE IS DI SMISSED. ORDER PRONOUNCED IN THE OPEN COURT. SD/- SD/- (SANJAY GARG) (ANNAPURNA GUPTA ) JUDICIAL MEMBER ACCOUNTANT MEMB ER DATED : 23/06/2017 AG COPY TO: THE APPELLANT, THE RESPONDENT, THE CIT, TH E CIT(A), THE DR