Smt. Seema Devi , Allahabad V. Income Tax Officer Range- 2(3), Allahabad

ITA 6/ALLD/2021

• Counselvise Citation: [2021] 104 COUNSELVISE.COM (IT) 5919 (ITAT-ALLAHABAD)
• Duration Of Justice: 6 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-12-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: misc
• Appeal Filed On: 06-06-2021
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Unexplained investment; Set aside
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL ALLAHABAD ‘SMC’ BENCH, ALLAHABAD BEFORE SHRI.VIJAY PAL RAO, JUDICIAL MEMBER ITA No. 6/ALLD/2021 Assessment Year: 2014-15 Smt. Seema Devi, 464-A Sultanpur Bhawa, Khuldabad, Allahabad, U.P. PAN-AGKPD5004D v . Income Tax Officer, 2(3), Allahabad, U.P. (Appellant) (Respondent) Appellant by: Sh. Praveen Godbole, C.A. Respondent by: Mr. A.K. Singh, Sr. DR Date of hearing: 22/12/2021 Date of pronouncement: 22/12/2021 O R D E R SHRI VIJAY PAL RAO, JUDICIAL MEMBER: This appeal by the assessee is directed against the order dated 10 th March, 2021 of CIT(A) (National Faceless Appeal Centre), Delhi for the assessment year 2014-15. The assessee has raised the following grounds. 1. “That in any view of the matter order passed u/s 143(3) of the income tax Act is bad both on the facts and in law and by such order income as determined at Rs. 15,76,550/- is highly unjustified and incorrect therefore the declared income should have been accepted in the facts and circumstances of the case. 2. That in any view of the matter the Id CIT(A) was wrong in deciding the appeal ex- parte without providing reasonable opportunity to the assessee and therefore the order is not speaking order in the eyes of law. 3. That in any view of the matter addition of Rs. 13,30,900/- was made by assessing officer by alleging unexplained investment by taking wrong figures and infact simply on presumption addition was made which is highly unjustified. 4. That in any view of the matter during the entire assessment proceeding no opportunity was allowed to the assessee nor the issue/objection of the assessee were taken into account hence the assessment is illegal and therefore the addition are unwarranted. 5. That in any view of the matter addition of Rs. 13,30,900/- as per Page 2 of the assessment order as made by the Assessing officer and confirmed by C1T(A) is highly unjustified and incorrect in the facts and circumstances of the case. ITA No.06 /ALLD/2021 Smt. Seema Devi 2 6. That in any view of the matter finding and observation of both the two lower authorities with regard to addition of Rs. 13,30,900/- are incorrect and contrary to the actual facts of the case. 7. That in any view of the matter the interest charged under different sections of the income tax act by the Assessing officer and confirmed by CIT(A) is highly unjustified and illegal in the facts and circumstances of the case. 8. That in any view of the matter the appellant reserves his right to take any fresh ground of appeal before hearing of the appeal.” 2. The assessee is an individual and derives income from the business as well as interest income. The assessee is a partner in firm M/s Tapasthali Infratech having 15% share. The assessee filed her return of income on 27 th January, 2015 declaring total income at Rs. 2,45,650/-. The case of the assesse was selected for scrutiny on the basis of AIR information regarding the investment of Rs. 80,26,000/- in purchase of property at Razaula Block- Majgawa, Madhya Pradesh. The Assessing Officer has made an addition of Rs. 13,30,900/- on account of explained investment in the property. On appeal, the CIT(A) confirmed the addition made by the Assessing Officer. 3. Before the Tribunal, the learned AR has submitted that the property in question was purchased by the firm M/s Tapasthali Infratech and the assessee has signed the sale deed on behalf of the firm being a partner duly authorized by the firm. The learned AR has thus contended that even as per the sale deed, the property was purchased by the firm and not by the assessee therefore, her source of purchase consideration is required to be explained by the firm and not by the assessee. He has further submitted that the total investment for purchase of the property in question was Rs. 17,15,000/- as per the sale deed and not Rs. 80,26,000/- which is alleged in the AIR information. The Assessing Officer has made the addition in the hands of the assessee without any material to show that the said consideration was paid by the assessee. Further, once it is evident from the sale deed that the property was purchased by the firm then the Assessing Officer could have verified the source of purchase consideration from the record of the firm. Thus, the learned AR has submitted that the matter may be remanded to the record of the Assessing Officer for ITA No.06 /ALLD/2021 Smt. Seema Devi 3 re-adjudication by considering the relevant record of the partnership firm regarding the source of purchase consideration of Rs. 17,15,000/-. He has undertaken that the assessee would produce the record of the partnership firm before the Assessing Officer for his examination. He has pointed out that the assessee has explained all these facts before the CIT(A) and filed an affidavit dated 8 th May, 2018 however, the same was not considered by the CIT(A) while passing the impugned order. 4. On the other hand, learned DR has submitted that despite sufficient opportunities granted by the Assessing Officer as well as CIT(A), the assessee could not produce any material to show the source of the purchase consideration. It is afterthought on behalf of the assessee to take this plea that the consideration was paid by the firm and not by the assessee. He has relied upon the orders of the authorities below. 5. I have considered the rival submissions as well as the relevant material on record. As it is evident from the sale deed dated 19 th December, 2013 that the agricultural land situated at Razaula Block- Majgawa, Madhya Pradesh was purchased by M/s Tapasthali Infratech, Chitrakoot, District Satna, Madhya Pradesh which was signed by the assessee Smt. Seema Devi being a partner and an authorized signatory on behalf of the firm. Since the purchase consideration was paid in cash therefore, merely because the property was purchased in the name of partnership firm would not lead to the conclusion that the consideration was paid by the firm and not by the assessee. The assessee did not produce any record before the Assessing Officer to show that the purchase consideration was paid by the firm. However, at the same time, the Assessing Officer has also not conducted any enquiry to verify the source of purchase consideration and creditworthiness of the partnership firm in whose name the property was purchased. Though the Assessing Officer has examined the other partners of the partnership firm by recording their statement but nothing has been mentioned in the assessment order regarding explanation of the other partners and their statements recorded by the Assessing Officer. The CIT(A) confirmed the ITA No.06 /ALLD/2021 Smt. Seema Devi 4 addition made by the Assessing Officer that the assessee has not disclosed his transaction in the return of income. It is pertinent to note that once the property was purchased on behalf of the firm and if the purchase consideration is paid by the firm then it is not necessary that the assessee shall disclosed this transaction in her individual return of income. As it is evident from the record that the Assessing Officer has not conducted a property enquiry regarding the source of purchase consideration from the record of the partnership firm therefore, this issue requires a proper verification and examination at the level of the Assessing Officer. Accordingly, the matter is set aside to the record of the Assessing Officer for deciding the same afresh after having a proper enquiry regarding the payment of consideration by the partnership firm or not and source of the same by verification of the record of the partnership firm. The assessee is directed to produce all the relevant records of the partnership firm for the verification and examination of the Assessing Officer. 6. In the result, the appeal of the assessee is allowed. Order pronounced in the open Court on 22.12.2021 at Allahabad. Sd/- [VIJAY PAL RAO] JUDICIAL MEMBER DATED: 22/12/2021 Allahabad Sh Copy forwarded to: 1. Appellant – 2. Respondent – 3. CIT(A) , Allahabad 4. CIT 5. DR - By order Assistant Registrar