Shri Prem Chand Tapen G-183, Neha Plastic Industries, G-183, RIICO Industrial Area, Bagru, Bagru, Jaipur Jajas Than, Jaipur V. ITO Ward-7(2), Jaipur, Ward-7(2), Jaipur

ITA 620/JPR/2019

• Counselvise Citation: [2020] 110 COUNSELVISE.COM (IT) 4251 (ITAT-JAIPUR)
• Duration Of Justice: 1 year(s) 5 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-10-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2012-2013
• Appeal Filed On: 02-05-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: R N SHARMA
• Keywords: Unexplained investment; Source of fund; Additional evidence; Set aside
• Section: 131; 69

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENC HES B JAIPUR JH FOT; IKY JKO] U;KF;D LNL; ,OA JH FOE FLAG ;KNO] YS[KK LNL; DS LE{K BEFORE: SHRI VIJAY PAL RAO, JM & SHRI VIKRA M SINGH YADAV, AM VK;DJ VIHY LA- @ ITA NO. 619/JP/2019 FU/KZKJ.K O'K Z @ ASSESSMENT YEAR :2012-13 INCOME TAX OFFICER, WARD -7(2), JAIPUR CUKE VS. SH. PREM CHAND TEPAN S/O SH. GOMA RAM KHATIK PROP., M/S NEHA PLASTIC INDUSTRIES, RIICO INDUSTRIAL AREA, G-183, C/O BHAGARIL GRANITES (P) LTD. MAHALA, JAIPUR LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO.: AEQPT7605E VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT VK;DJ VIHY LA- @ ITA NO. 620/JP/2019 FU/KZKJ.K O'K Z @ ASSESSMENT YEAR :2012-13 SH. PREM CHAND TEPAN S/O SH. GOMA RAM KHATIK PROP., M/S NEHA PLASTIC INDUSTRIES, RIICO INDUSTRIAL AREA, G-183, C/O BHAGARIL GRANITES (P) LTD. MAHALA, JAIPUR CUKE VS. INCOME TAX OFFICER, WARD -7(2), JAIPUR LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO.: AEQPT7605E VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT FU/KZKFJRH DH VKSJ L S@ ASSESSEE BY : SH. R. N. SHARMA (ADV.) JKTLO DH VKSJ LS @ REVENUE BY : SMT. RUNI PAL (ADDL. CIT) LQUOKBZ DH RKJH[ K@ DATE OF HEARING : 06/10/2020 MN?KKS'K.KK DH RKJH[ K@ DATE OF PRONOUNCEMENT: 27/10/2020 VKNS'K@ ORDER ITA NO. 619 & 620/JP/2019 ITO VS. SH. PREM CHAND TEPAN 2 PER: VIKRAM SINGH YADAV, A.M. THESE ARE CROSS APPEALS FILED BY THE REVENUE AND TH E ASSESSEE AGAINST THE ORDER OF LD. CIT(A)-01, JODHPUR DATED 16.01.201 9 FOR A.Y. 2012-13 WHEREIN THE RESPECTIVE GROUNDS OF APPEAL READ AS UNDER:- ITA NO. 619/JP/2019 (REVENUES APPEAL) 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE, WHETHER THE LD. CIT(A) WAS JUSTIFIED IN RESTRICTING THE ADDITI ON FROM RS. 2,41,94,900/- TO RS. 34,50,000/- MADE U/S 69 OF THE ACT BY OBSER VING THAT THE AMOUNT TO THE TUNE OF RS. 2,07,44,900/- WAS EXPLAINED? 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E, WHETHER THE LD. CIT(A) WAS JUSTIFIED IN RESTRICTING THE ADDITI ON FROM RS. 2,41,94,900/- TO RS. 34,50,000/- MADE U/S 69 OF THE ACT IGNORING THE FACT THAT THE AO, IN HIS REMAND REPORT HAS CLEARLY MENTIONED THAT OU T OF UNSECURED LOAN OF RS.1,15,64,000/-, LOAN TO THE TUNE OF RS. 69,75 ,000/- WAS NOT VERIFIABLE IN ADDITION TO PAYMENT OF RS. 1,26,30,9 00/- (RS.2,41,94,900 - RS.1,15,64,000) WHICH WAS MADE BY THE ASSESSEE IN CASH FOR MAKING INVESTMENT IN PURCHASE OF PROPERTIES. ITA NO. 620/JP/2019 (ASSESSEES APPEAL) 1. THE LD. COMMISSIONER (APPEALS) HAS ERRED IN CONFORMING THE ADDITION MADE BY THE AO U/S 69 TO TH E EXTENT OF RS. 34,50,000/- IGNORING THE FACT THAT ADDITION U/S 69 CAN ONLY BE MADE WHEN THE INVESTMENT IS NOT RECORDED IN THE BOOKS OF ACCOUNTS. 2. THE LD. COMMISSIONER (APPEALS) HAS ERRED IN ENHA NCING THE ASSESSMENT BY RS. 14,48,700/- ON ACCOUNT OF EXPENSE S INCURRED ON STAMPS DUTY SIMPLY ON THE BASIS OF REMAND REPORT OF THE AO, WITHOUT PROVIDING THE ASSESSEE ON OPPORTUNITY TO REBUT IT. ITA NO. 619 & 620/JP/2019 ITO VS. SH. PREM CHAND TEPAN 3 2. BRIEFLY THE FACTS OF THE CASE ARE THAT DURING TH E COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER OBSERVED THAT TH E ASSESSEE HAS PURCHASED CERTAIN PIECES OF LAND SITUATED AT VILLAGE- VATIKA, TEHSIL- SANGANER, JAIPUR BEARING KHASRA NO. 1182 TO 1221, 1223 TO 1235, 1242 TO 1248 FROM SH. LACHHU, SH. SULTAN, SH. ARJUN AND SH. PRABHU NARAYA N. THE ASSESSEE HAS INVESTED AN AMOUNT OF RS. 2,41,94,000/- IN PURCHASI NG THE SAID PIECES OF LAND. THE ASSESSEE WAS ASKED TO EXPLAIN SOURCE OF FUNDS W HICH WERE USED IN PURCHASING THE SAID PIECES OF LAND VIDE SHOW CAUSE DATED 02.03.2015. IN COMPLIANCE, THE A/R OF THE ASSESSEE SUBMITTED COPY OF THE PURCHASE DEEDS AND ALSO FILED CONFIRMATION OF UNSECURED LOAN TAKEN FRO M FOUR PERSONS NAMELY SH. MAHENDRA KUMAR MEENA, M/S SHRISHTIANAND BUILDERS AN D COLONIZERS, SMT. KANTA SHARMA & SH. ASHISH NITHARWAL. IN ORDER TO C ARRY OUT FURTHER VERIFICATION, THE SUMMONS U/S 131 WERE ISSUED THROUGH REGISTERED POST AND NOTICE SERVER. SH. ASHISH NITHARWAL REFUSED TO TAKE THE SUMMONS IS SUED TO HIM AS REPORTED BY THE NOTICE SERVER AND THE ADDRESS OF SH. MAHENDRA K UMAR MEENA WAS FOUND INCORRECT. THEREAFTER, THE ASSESSEE WAS ASKED TO PR ODUCE THESE PERSONS AND TO SUBMIT COPY OF THEIR BANK ACCOUNT STATEMENTS FOR VE RIFICATION OF THE LAND TRANSACTIONS BUT THESE PEOPLE NEITHER APPEARED NOR COPIES OF BANK ACCOUNTS WERE FURNISHED. THE ASSESSING OFFICER ACCORDINGLY T REATED THESE LOAN TRANSACTIONS AS BOGUS UNSECURED LOAN AND ACCORDINGL Y HELD THAT THE ASSESSEE FAILED TO EXPLAIN THE SOURCE OF FUND OF RS. 2,41,94 ,000/- USED IN PURCHASING OF LAND FROM THE ABOVE SELLERS AND THE SAID AMOUNT WAS TREATED AS UNEXPLAINED INVESTMENT U/S 69 OF THE ACT AND ADDED TO THE TOTAL INCOME OF THE ASSESSEE. 3. BEING AGGRIEVED, THE ASSESSEE CARRIED THE MATTER IN APPEAL BEFORE THE LD. CIT(A) AND AFTER CONSIDERING THE ADDITION EVIDENCE SUBMITTED BY THE ASSESSEE AND THE REMAND REPORT SUBMITTED BY THE AO, THE ADDI TION WAS RESTRICTED TO RS. 48,98,700/- BY THE LD. CIT(A) AND AGAINST THE SAID FINDINGS, BOTH THE REVENUE AS WELL AS THE ASSESSEE ARE IN APPEAL BEFORE US. ITA NO. 619 & 620/JP/2019 ITO VS. SH. PREM CHAND TEPAN 4 4. DURING THE COURSE OF HEARING, THE LD. DR SUBMIT TED THAT THE LD. CIT(A) HAS ERRED IN RESTRICTING THE ADDITIONS FROM RS. 2,4 1,94,000/- TO RS. 34,50,000/- AND SUBMITTED THAT WHILE RESTRICTING THE SAID ADDIT ION, THE LD. CIT(A) HAS NOT SPECIFIED AS TO HOW THE SOURCE OF THE INVESTMENT IN PURCHASE OF SPECIES PIECES OF LAND HAS BEEN FOUND EXPLAINED BY HIM. IT WAS SUB MITTED THAT THERE IS NO SPECIFIC FINDING WHICH HAS BEEN RECORDED BY THE LD. CIT(A) AND THEREFORE, THE ORDER PASSED BY THE LD. CIT(A) IS PERVERSE AND DESE RVES TO BE SET ASIDE. 5. PER CONTRA, THE LD. AR HOWEVER SUPPORTED THE FI NDING OF THE LD. CIT(A) AND SUBMITTED THAT THE LD CIT(A) HAS TAKEN INTO CON SIDERATION THE REMAND REPORT SUBMITTED BY THE ASSESSING OFFICER AND HAS H ELD THAT ISSUE WITH RESPECT TO RS. 69,75,000/- REMAINS TO BE ADJUDICATED UPON A S THE SAME HAS NOT BEEN FOUND SATISFACTORILY EXPLAINED AT THE END OF THE AS SESSING OFFICER. THEREAFTER, OUT OF RS. 69,75,000/-, HE HAS FOUND THE TRANSACTIO NS TO THE EXTENT OF RS. 35,25,000/- AS DULY EXPLAINED BY THE ASSESSEE AND R EMAINING TRANSACTIONS OF RS. 34,50,000/- HAVE BEEN FOUND AS NOT SATISFACTORI LY EXPLAINED AND TO THAT EXTENT, THE ADDITIONS WERE SUSTAINED. IT WAS SUBMIT TED THAT THE ASSESSEE IS IN APPEAL AS FAR AS THE ADDITIONS SUSTAINED BY THE LD. CIT(A) HOWEVER AS FAR AS RELIEF GRANTED BY THE LD. CIT(A), THERE IS NO INFIR MITY IN THE ORDER OF LD. CIT(A) AND THE ASSESSEE THUS RELIES ON THE ORDER OF THE LD . CIT(A) AND THE SAME SHOULD BE CONFIRMED. 6. NOW COMING TO THE GROUNDS OF APPEAL TAKEN BY THE ASSESSEE VIS--VIS THE ADDITION OF RS 34,50,000/- SUSTAINED BY THE LD. CIT (A) AND ENHANCEMENT OF INCOME BY RS 14,48,700/- DONE BY THE LD CIT(A). 7. IN THIS REGARD, THE LD. AR SUBMITTED THAT THE A PPELLANT HAD PURCHASED AGRICULTURAL LANDS AT VATIKA VILLAGE, SANGANER, FRO M FOUR DIFFERENT PARTIES FOR RS.2,41,94,900/-. PART CONSIDERATION OF RS.49,09,80 0/- FOR THESE LANDS WAS PAID DURING THE YEAR, AND FURTHER EXPENSES OF RS.14,48,7 00/- ON STAMP DUTY AND REGISTRATION CHARGES WERE INCURRED, THE FUNDS FOR W HICH WERE ARRANGED BY ITA NO. 619 & 620/JP/2019 ITO VS. SH. PREM CHAND TEPAN 5 OBTAINING UNSECURED LOANS AGGREGATING RS.82,14,000/ - FROM FOUR PARTIES. CONFIRMATIONS FROM ALL THE FOUR PERSONS WERE FILED DULY INDICATING THEIR PAN (WHEREVER AVAILABLE) AND COMPLETE ADDRESS. THE AO H ELD THE COST OF LAND AS UNEXPLAINED, AND PROCEEDED TO MAKE ADDITION OF RS. 2,41,94,900/- U/S 69. IT WAS VEHEMENTLY PLEADED BEFORE THE LD. CIT(A) THAT A DDITION U/S 69 CANNOT BE MADE IN THESE CIRCUMSTANCES, AS THE INVESTMENT STOO D DULY RECORDED IN THE BOOKS. THE LD. CIT(A) FAILED TO UNDERSTAND THE CASE IN THE RIGHT PERSPECTIVE. INSTEAD, HE HELD THAT THE UNSECURED LOANS TAKEN FRO M THREE CASH CREDITORS REMAIN UNVERIFIED AND SHOULD BE ADDED TO THE INCOME . 8. IT WAS SUBMITTED THAT ADDITION WAS MADE BY THE AO U/S 69 IN RESPECT OF INVESTMENT MADE FOR PURCHASE OF AGRICULTURAL LANDS. THUS, THE GENUINENESS OF THE CASH CREDITS WAS NEVER AN ISSUE FOR CONSIDERATI ON. HOWEVER DURING THE APPELLATE PROCEEDINGS BEFORE THE CIT(A), THE CONFIR MATIONS ALONG WITH EXPLANATIONS WERE CALLED FOR AND PROVIDED. BUT THE LD. CIT(A) FAILED TO CONSIDER THE SAME. 9. IT WAS SUBMITTED THAT THE APPELLANT HAD OBTAINED UNSECURED LOANS OF RS. 82,14,000/- DURING THE YEAR FROM THE FOLLOWING PERS ONS- S.NO. NAME OF THE PARTY AMOUNT (RS.) 1. M/S SHRISTIANAND BUILDERS & COLONIZERS 45,89,000 /- 2. MAHENDRA KUMAR MEENA 5,25,000/- 3. ASHISH NITHARWAL 26,00,000/- 4. KANTA SHARMA 5,00,000/- TOTAL 82,14,000/- THE LD.CIT(A) HELD THAT THE LOANS FROM ASHISH NITHA RWAL, KANTA SHARMA AND RAMAVTAR HARI NARAYAN (WHICH WAS NOT TAKEN DURING T HE YEAR) AS UNEXPLAINED. THE CONFIRMATIONS OF ASHISH NITHARWAL AND KANTA SHA RMA ARE ONCE AGAIN BEING PROVIDED. THEIR ADDRESSES WERE ALSO MADE KNOWN TO T HE AO AS WELL AS CIT(A). BUT THE AO, AT THE TIME OF REMAND PROCEEDINGS INSIS TED FOR COPY OF BANK ACCOUNT OF THESE PERSONS. IT WAS MADE KNOWN THAT TH E PARTIES HAVE REFUSED TO ITA NO. 619 & 620/JP/2019 ITO VS. SH. PREM CHAND TEPAN 6 PROVIDE IT TO THE APPELLANT. THE APPELLANT PRODUCED COPY OF HIS BANK ACCOUNT WHICH CLEARLY SHOWS THE IMPUGNED AMOUNTS HAVING BEE N RECEIVED THROUGH CHEQUES. STILL, THE CIT(A) SIMPLY RELYING ON THE RE MAND REPORT HELD THESE AMOUNTS TO BE UNEXPLAINED. 10. IT WAS SUBMITTED THAT UNDOUBTEDLY, THE ASSESSEE HAS A LEGAL DUTY TO IDENTIFY THE CREDITORS IN ADDITION TO HIS MEANS AND GENUINENESS OF THE TRANSACTION. ALSO IT IS A MATTER OF FACT THAT WHERE THE IDENTITIES OF CREDITORS ARE SHOWN BY THE ASSESSEE, THE DEPARTMENT IS AT LIBERTY TO PROCEED AGAINST SUCH CREDITOR WHEREVER REQUIRED. THIS VIEW HAS BEEN UPHE LD BY THE TRIBUNAL IN THE CASE OF MRS. RANJANA KATYAL VS ACIT (2008) 1 DTR (D EL)(TRIB) 24 AND PANKAJ SAWHNEY VS ITO (2004) 3 SOT 1 (DEL). IN THIS CASE, THE IDENTITY AND THE ADDRESS WAS SHOWN BY THE APPELLANT. 11. IT WAS FURTHER SUBMITTED THAT IT IS PRESUMED, S UBJECT TO REBUTTAL, THAT TRANSACTION CANNOT BE CONSIDERED AS BOGUS WHEN THE FUNDS ARE ROUTED THROUGH BANK ACCOUNTS AS THEY CANNOT BE CONSIDERED AS UNACC OUNTED MONIES BEING THE PURPOSE FOR WHICH THE PROVISION WAS INTRODUCED AND ALSO THE BANK STATEMENTS ARE VERY MUCH SUBJECT TO SCRUTINY OF THE DEPARTMENT . IN SUPPORT, RELIANCE WAS PLACED ON DECISION IN CASE OF S.K.JAIN VS ITO (2004 ) 2 SOT 579 (AGRA). THUS, IT HAD BECOME FAIRLY SETTLED LAW THAT ASSESSEE IS N OT REQUIRED TO SATISFY THE ASSESSING AUTHORITY OF THE SOURCE OF SOURCE. THE AP PELLANT HAD DULY DISCHARGED THE ONUS CAST ON HIM IN RESPECT OF CASH CREDITS. IT WAS FOR THE AO TO PROVE THAT THE CASH CREDITS WERE NOT GENUINE THROUGH FURTHER I NQUIRIES, WHICH HE FAILED TO DO. 12. AS REGARDS AMOUNT OF RS.3,50,000/- FROM SHRI RA MAVTAR HARI NARAYAN HELD AS UNEXPLAINED BY THE LD.CIT(A), IT WAS SUBMIT TED THAT THE IMPUGNED AMOUNT WAS NOT OBTAINED DURING THE YEAR. IT WAS TAK EN IN FY 2012-13, AS IS EVIDENT FROM THE BALANCE SHEETS OF THE ASSESSEE. TH EREFORE, NO ADDITION CAN BE ITA NO. 619 & 620/JP/2019 ITO VS. SH. PREM CHAND TEPAN 7 MADE OR SUSTAINED AS THE IMPUGNED AMOUNT DOES NOT S TAND CREDITED IN THE BOOKS OF THE ASSESSEE OF THE RELEVANT PREVIOUS YEAR . 13. REGARDING GROUND NO. 2, IT WAS SUBMITTED BY THE LD AR THAT THE APPELLANT HAD PURCHASED CERTAIN AGRICULTURAL LANDS DURING THE RELEVANT YEAR. HE HAD PAID STAMP DUTY OF RS.14,48,700/- IN CASH ON THESE PURCH ASES. THE AMOUNT STOOD DULY REFLECTED IN HIS BALANCE SHEET OF THE YEAR. T HE AO HAD TAKEN NOTE OF IT AT THE TIME OF ASSESSMENT. AT THE TIME OF SUBMITTING T HE REMAND REPORT, THE AO OUT OF NOWHERE, REACHED TO THE CONCLUSION THAT STAM P DUTY OF RS.14,48,700/- SHOULD ALSO BE ADDED AND RECOMMENDED TO THE CIT(A) TO ADD THE SAME. THE LD.CIT(A) STRAIGHT AWAY HELD THE IMPUGNED AMOUNT TO BE UNEXPLAINED. HE DID NOT EVEN BOTHER TO ASK THE AO AS TO HOW HE FORMED T HIS OPINION. EVEN THE APPELLANT WAS NOT PROVIDED AN OPPORTUNITY TO REBUT THE SAME. AS STATED SUPRA, THE AMOUNT FORMED PART OF AGRICULTURAL LAND PURCHAS ED AND WAS DULY SHOWN IN THE BALANCE SHEET. THE CASH BOOK OF THE ASSESSEE VO UCHES THE FACT THAT THE PAYMENT HAS BEEN MADE FROM DISCLOSED SOURCES. THE A SSESSEE HAD SUFFICIENT AVAILABILITY OF CASH TO MAKE THE ABOVE PAYMENT OF R S.14,78,700/-. 14. PER CONTRA, THE LD. DR SUBMITTED THAT THE SUMMO NS ISSUED TO THESE PEOPLE FROM WHOM THE ASSESSEE CLAIMS TO HAVE OBTAIN ED UNSECURED LOANS REMAINED UN-COMPLIED WITH DURING THE COURSE OF ASSE SSMENT PROCEEDINGS, AND EVEN DURING THE REMAND PROCEEDINGS THESE LOAN TRANS ACTIONS REMAINED UNVERIFIED AND THEREFORE, MERELY THE FACT THAT THIS HAVE FILED THE CONFIRMATION, THE SAME CANNOT BE TAKEN AS DUE COMPLIANCE OF THE I NITIAL ONUS CAST ON THE ASSESSEE TO SATISFY THE IDENTITY OF THE PERSON, THE GENUINENESS OF THE TRANSACTION AND CREDITWORTHINESS OF THESE PERSONS T O ADVANCE THE LOAN TO THE ASSESSEE. REGARDING ENHANCEMENT OF INCOME BY RS. 14 ,48,700/- ON ACCOUNT OF STAMP DUTY EXPENSES, THE LD. DR SUBMITTED THAT THE REMAND REPORT SUBMITTED BY THE ASSESSING OFFICER WHEREIN HE HAS HIGHLIGHTED THE SAID FACT HAS BEEN SHARED WITH ASSESSEE AND THEREFORE, THE ASSESSEE WA S PUT TO THE NOTICE BY THE LD. CIT(A) AND THEREFORE, IT IS NOT CORRECT TO SAY THAT THE ASSESSEE WAS NOT ITA NO. 619 & 620/JP/2019 ITO VS. SH. PREM CHAND TEPAN 8 PROVIDED AN OPPORTUNITY BY THE LD. CIT(A) BEFORE MA KING SUCH ADDITION. THE LD. DR ACCORDINGLY SUPPORTED THE ORDER AND THE FINDINGS OF LD. CIT(A) IN THIS REGARD. 15. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PURUSE D THE MATERIAL AVAILABLE ON RECORD. DURING THE YEAR UNDER CONSIDERATION, TH E ASSESSEE HAS PURCHASED CERTAIN PIECES OF LAND SITUATED AT VILLAGE VATIKA, TEHSIL SANGANER, JAIPUR BEARING KHASRA NO. 1182 TO 1221, 1223 TO 1235, 1242 TO 1248 FROM SH. LACHHU, SH. SULTAN, SH. ARJUN AND SH. PRABHU NARAYAN FOR A TOTA L CONSIDERATION OF RS 2,41,94,000/-. THE CONVEYANCE DEEDS FOR THE PURCHAS E OF THESE PIECES OF LAND WERE REGISTERED WITH SUB-REGISTRAR, SANGANER, JAIPU R ON 21.11.2011 AND AN AMOUNT OF RS 14,48,700/- WAS ALSO PAID TOWARDS THE STAMP DUTY. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSEE WAS ASKED TO EXPLAIN SOURCE OF FUNDS WHICH WERE USED IN PURCHASING THE SAID PIECES OF LAND VIDE SHOW CAUSE DATED 02.03.2015. IN COMPLIANCE, THE A/R OF THE ASS ESSEE SUBMITTED COPY OF THE PURCHASE DEEDS AND ALSO FILED CONFIRMATION OF U NSECURED LOANS TOTALING RS 82,14,000/- TAKEN FROM FOUR PERSONS NAMELY SH. MAHE NDRA KUMAR MEENA, M/S SHRISHTIANAND BUILDERS AND COLONIZERS, SMT. KANTA S HARMA & SH. ASHISH NITHARWAL. IN ORDER TO CARRY OUT FURTHER VERIFICAT ION, THE SUMMONS U/S 131 WERE ISSUED THROUGH REGISTERED POST AND NOTICE SERV ER. SH. ASHISH NITHARWAL REFUSED TO TAKE THE SUMMONS ISSUED TO HIM AND THE A DDRESS OF SH. MAHENDRA KUMAR MEENA WAS FOUND INCORRECT. THEREAFTER, THE AS SESSEE WAS ASKED TO PRODUCE THESE PERSONS AND TO SUBMIT COPY OF THEIR B ANK ACCOUNT STATEMENTS FOR VERIFICATION OF THE LAND TRANSACTIONS BUT THESE PEO PLE NEITHER APPEARED NOR COPIES OF BANK ACCOUNTS WERE FURNISHED. THE ASSESSI NG OFFICER ACCORDINGLY TREATED THESE LOAN TRANSACTIONS AS BOGUS UNSECURED LOAN AND ACCORDINGLY HELD THAT THE ASSESSEE FAILED TO EXPLAIN THE SOURCE OF F UNDS OF RS. 2,41,94,000/- USED IN PURCHASING OF LAND FROM THE ABOVE SELLERS A ND THE SAID AMOUNT WAS TREATED AS UNEXPLAINED INVESTMENT U/S 69 OF THE ACT AND ADDED TO THE TOTAL INCOME OF THE ASSESSEE. BEING AGGRIEVED, THE ASSESS EE CARRIED THE MATTER IN APPEAL BEFORE THE LD. CIT(A) AND SUBMITTED THAT AN AMOUNT OF RS 49,08,900 ITA NO. 619 & 620/JP/2019 ITO VS. SH. PREM CHAND TEPAN 9 WAS ACTUALLY PAID DURING THE FINANCIAL YEAR 2011-12 AS AGAINST THE TOTAL VALUE OF LAND OF RS 2,41,94,900/- AND REMAINING AMOUNT WAS O UTSTANDING AT THE END OF THE FINANCIAL YEAR 2011-12. IT WAS FURTHER SUBMITT ED THAT DURING THE NEXT FINANCIAL YEAR, THE ASSESSEE TOOK ADDITIONAL UNSECU RED LOANS OF RS 33,50,000/- FROM M/S GRASSFIELD VILLA (P) LTD AND RAMOTAR HARI NARAYAN. CONSIDERING THE ADDITION EVIDENCES SUBMITTED BY THE ASSESSEE, THE R EMAND REPORT WAS CALLED FROM THE AO. IN HIS REMAND REPORT, THE AO STATED T HAT THE ASSESSEE HAS TAKEN UNSECURED LOANS OF RS 82,14,000/- DURING THE FINANC IAL YEAR 2011-12 AND RS 33,50,000/- DURING THE FINANCIAL YEAR 2012-13 TOTAL LING TO RS 1,15,64,000/-. IT WAS FURTHER STATED THAT IN RE SPECT OF UNSECURED LOAN OF RS 45,89,000/- TAKEN FROM SHRISHTIANAND BUILDERS AND C OLONISERS, COPY OF THE BANK STATEMENT WAS SUBMITTED WHICH SHOWS GENUINENESS OF THE TRANSACTION AND IN RESPECT OF OTHER UNSECURED LOANS AMOUNTING TO RS 69 ,75,000/-, NO DOCUMENTS WERE SUBMITTED IN TERMS OF BANK STATEMENTS AND INCO ME TAX RETURNS WHICH PROVES THE CREDITWORTHINESS AND GENUINENESS OF THE UNSECURED LOAN TRANSACTIONS. THE LD CIT(A) TAKING THE REMAND REPO RT INTO CONSIDERATION HELD THAT ISSUE WITH RESPECT OF RS 69,75,000/- REMAINS T O BE ADJUDICATED UPON AS THE SAME HAS NOT BEEN FOUND SATISFACTORILY EXPLAINE D AT THE END OF THE AO. THEREAFTER, AFTER CONSIDERING THE SUBMISSIONS OF TH E ASSESSEE, HELD THAT OUT OF RS 69,75,000/-, RS 35,25,000/- HAS BEEN FOUND EXPLA INED AND REMAINING RS 34,50,000/- REMAINS UNEXPLAINED AND THE ADDITIONS W ERE THUS RESTRICTED TO RS. 34,50,000/-. FURTHER, THE LD CIT(A) MADE AN AD DITION OF RS 14,48,700/- TOWARDS THE PAYMENT OF STAMP DUTY. 16. THE UNDISPUTED FACTS WHICH ARE THUS EMERGING FR OM THE PERUSAL OF RECORDS ARE THAT THERE IS AN INVESTMENT OF RS 2,41, 94,000/-IN PURCHASE OF THE AFORESAID PIECES OF LAND BESIDES STAMP DUTY OF RS 1 4,48,700/- TOTALLING TO RS 2,56,42,700/-. DURING THE COURSE OF ASSESSMENT P ROCEEDINGS, THE SOURCE OF SUCH INVESTMENT WAS SOUGHT TO BE EXAMINED BY THE AO . THE SOURCE OF SUCH INVESTMENT HAS BEEN CLAIMED BY THE ASSESSEE BY WAY OF UNSECURED LOANS OF RS 82,14,000/- DURING THE FINANCIAL YEAR 2011-12 AND R S 33,50,000/- DURING THE ITA NO. 619 & 620/JP/2019 ITO VS. SH. PREM CHAND TEPAN 10 FINANCIAL YEAR 2012-13 TOTALLING TO RS 1,15,64,000/ - AND REMAINING AMOUNT OF RS 1,40,78,700/- IS THUS CLAIMED TO BE OUT OF HIS O WN FUNDS. FIRSTLY, WE FIND THAT THERE IS NO SPECIFIC FINDING WHICH HAS BEEN RE CORDED BY THE LD CIT(A) REGARDING THE SOURCE OF INVESTMENT TO THE TUNE OF R S 45,89,000/-, BEING THE UNSECURED LOAN TAKEN FROM SHRISHTIANAND BUILDERS AN D COLONIZERS. THE AO IN THE REMAND REPORT HAS ALSO MERELY GONE BY THE BANK STATEMENT OF SHRISHTIANAND BUILDERS AND COLONIZERS AND CONFIRMED THE GENUINENESS OF THE LOAN TRANSACTION. WHERE A LOAN TRANSACTION HAS BEEN CLAIMED TO BE ENTERED INTO BY THE ASSESSEE, THE NECESSARY ATTRIBUTES OF SUCH L OAN TRANSACTION IN TERMS OF TENURE, PURPOSE, RATE OF INTEREST, REPAYMENT AND HY POTHECATION/GUARANTEE FOR AVAILING SUCH LOAN TRANSACTION NEEDS TO BE SUBSTANT IATED BY THE ASSESSEE AND WHICH NEEDS TO BE EXAMINED BY THE AO. FURTHER, THE DISBURSEMENT OF LOAN AND ITS UTILIZATION FOR MAKING THE AFORESAID INVESTMENT NEEDS TO BE VERIFIED. HOWEVER, WE FIND THAT THERE IS NO FINDING RECORDED BY EITHER OF THE TWO AUTHORITIES AND THE MATTER HAS BEEN SUMMARILY DECID ED. SUCH A FINDING CLEARLY DESERVE TO BE SET-ASIDE AND THE MATTER NEEDS TO BE EXAMINED A FRESH AS PER LAW. 17. SIMILARLY, THE LD CIT(A) HAS FOUND THE UNSECURE D LOAN TRANSACTION WITH M/S GRASS FIELD VILLA PVT LTD TO BE SATISFACTORILY EXPLAINED WHICH WE AGAIN FOUND TO BE UNACCEPTABLE. HE HAS REFERRED TO BALANCE SHE ET, INCOME TAX RETURN AND BANK STATEMENT OF M/S GRASS FIELD VILLA PVT LTD AND ANOTHER FIRM BY NAME OF M/S GRASS FIELD FARMS AND RESORTS PVT LTD TO HOLD T HE TRANSACTION TO BE DULY EXPLAINED HOWEVER, HE HAS AGAIN FAILED TO CONSIDER THE NECESSARY ATTRIBUTES OF SUCH LOAN TRANSACTION IN TERMS OF TENURE, PURPOSE, RATE OF INTEREST, REPAYMENT AND HYPOTHECATION/GUARANTEE FOR AVAILING SUCH LOAN TRANSACTION AND NO FINDING HAS BEEN RECORDED BY HIM IN THIS REGARD. SIMILAR F INDING HAS BEEN RECORDED BY THE LD CIT(A) REGARDING LOAN TRANSACTION WITH MAHEN DER KUMAR MEENA WHICH DESERVE TO BE SET-ASIDE TO BE EXAMINED AFRESH. DU RING THE COURSE OF HEARING, THE LD AR HAS SOUGHT TO SUBMIT ADDITIONAL EVIDENCE BY WAY OF BANK STATEMENT ITA NO. 619 & 620/JP/2019 ITO VS. SH. PREM CHAND TEPAN 11 OF SHRI ASHISH CHOUDHARY IN SUPPORT OF ANOTHER UNSE CURED LOAN TRANSACTION OF RS 26,00,000/- WHICH AGAIN NEEDS TO BE VERIFIED. 18. SECONDLY, WE FIND THAT THERE IS NO FINDING RECO RDED BY EITHER OF THE TWO AUTHORITIES AS TO THE CLAIM OF THE ASSESSEE REGARDI NG INVESTMENT TO THE TUNE OF RS 1,40,78,700/- BEING MADE OUT OF ASSESSEES OWN F UNDS. ONCE THE INVESTMENT HAS BEEN MADE DURING THE YEAR VIDE REGIS TERED SALE DEED DATED 21.11.2011 AND THE ASSESSEE CLAIMS THE SAME TO BE M ADE OUT OF HIS OWN FUNDS, THEN, IT IS INCUMBENT ON PART OF THE ASSESSE E TO CORROBORATE THE SAME WITH HIS BOOKS OF ACCOUNTS AND THE TAXING AUTHORITI ES ARE REQUIRED TO VERIFY THE SAME AND RECORD A FINDING AS TO THEIR SATISFACTION OR OTHERWISE OF SUCH CLAIM BEING MADE BY THE ASSESSEE AND WHETHER THE SOURCE O F SUCH INVESTMENT HAS BEEN FOUND DULY EXPLAINED OR NOT. 19. IN LIGHT OF AFORESAID DISCUSSIONS AND IN THE EN TIRETY OF FACTS AND CIRCUMSTANCES OF THE CASE, WE ARE OF THE CONSIDERED VIEW THAT THE MATTER RELATING TO SOURCE OF INVESTMENT THROUGH LOAN TRANS ACTION AS WELL AS OWN FUNDS IN PURCHASE OF THE AFORESAID PIECES OF LAND THROUGH REGISTERED SALE DEEDS DATED 21.11.2011 INCLUDING THAT OF THE STAMP DUTY NEEDS T O BE EXAMINED AFRESH. THE MATTER IS ACCORDINGLY SET-ASIDE TO THE FILE OF THE AO TO EXAMINE THE SAME AFRESH AS PER LAW AFTER PROVIDING REASONABLE OPPORTUNITY T O THE ASSESSEE. IN THE RESULT, BOTH THE APPEALS OF THE REVENUE AND THE ASSESSEE ARE ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 27/10/2020. SD/- SD/- FOT; IKY JKO FOE FLAG ;KNO (VIJAY PAL RAO) (VIKRAM SINGH YADAV) U;KF;D LNL;@ JUDICIAL MEMBER YS[KK LNL;@ ACCOUNTANT MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 27/10/2020 ITA NO. 619 & 620/JP/2019 ITO VS. SH. PREM CHAND TEPAN 12 * GANESH KR. VKNS'K DH IZFRFYFI VXZSFKR@ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ@ THE APPELLANT- ITO, WARD 7(2), JAIPUR 2. IZR;FKHZ@ THE RESPONDENT- SH. PREM CHAND TEPAN, JAIPUR 3. VK;DJ VK;QDR@ CIT 4. VK;DJ VK;QDR@ CIT(A) 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ@ DR, ITAT, JAIPUR. 6. XKMZ QKBZY@ GUARD FILE {ITA NOS. 619 & 620/JP/2019} VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ@ ASST. REGISTRAR