SHRI RAVI YADAV, JAIPUR V. INCOME TAX OFFICER, WARD-2-3, JAIPUR

ITA 626/JPR/2018

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 7779 (ITAT-JAIPUR)
• Duration Of Justice: 1 year(s) 8 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-01-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2014-2015
• Appeal Filed On: 08-05-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: K C GUPTA J DHK
• Keywords: Unexplained investment; Additional evidence
• Section: 13; 69

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCH 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 VIKRAM SINGH YADAV, AM VK;DJ VIHY LA-@ ITA NO. 626/JP/2018 FU/KZKJ.K O'K Z@ ASSESSMENT YEAR : 2014-15 SHRI RAVI YADAV 1, TEACHERS COLONY, DCM MAIN AJMER ROAD, JAIPUR CUKE VS. THE ITO WARD- 2(3) JAIPUR LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO .: ABVPY 2343 Q VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT FU/KZKFJRH DH VKSJ LS@ ASSESSEE BY : SHRI SHRAWAN KUMAR GUPTA, ADVOCATE JKTLO DH VKSJ LS@ REVENUE BY : SHRI K.C. GUPTA, JCIT-DR LQUOKBZ DH RKJH[K@ DATE OF HEARING : 08/01/2020 ?KKS'K .KK DH RKJH[K@ DATE OF PRONOUNCEMENT : 13 /01/2020 VKNS'K@ ORDER PER VIJAY PAL RAO, JM THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST TH E ORDER DATED 12-02-2018 OF LD. CIT(A)-1, JAIPUR FOR THE ASS ESSMENT YEAR 2014-15. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS. 1. THE LD. CIT(A) HAS ERRED IN CONFIRMING THE ADD ITION OF RS. 4,46,400/- ON ACCOUNT OF UNEXPLAINED INVESTMENT U/S 69 OF I.T. ACT, 1961 WITHOUT HAVING PROPER CONSIDERATION TO THE DOC UMENTS ON RECORD AND CIRCUMSTANCES OF THE CASE. 2. THE LD. CIT(A) HAS ERRED IN MODIFYING THE ASSESS MENT ORDER PASSED BY ITO SO AS TO REMOVE THE DEFECTS IN THE SA ID ORDER. ITA NO.626/JP/2018 SHRI RAVI YADAV VS ITO, WARD- 2(3), JAIPUR 2 3. THE LD. CIT(A) HAS ERRED IN RELYING ON THE DOCUM ENTS WHICH HE HIMSELF HAD NOT ADMITTED AS ADDITIONAL EVIDENCE AND HAS NOT PROVIDED OPPORTUNITY TO THE ASSESSEE OF BEING HEARD. 2.1 THE GROUND NOS. 1 TO 3 OF THE ASSESSEE ARE REGA RDING DELETION OF ADDITION OF RS. 4,46,400/- U/S 69 OF THE ACT WHICH WAS CONFIRMED BY THE LD. CIT(A) 2.2 THE ASSESSEE IS AN INDIVIDUAL AND FILED THE RE TURN OF INCOME ON 31- 07-2014 DECLARING TOTAL INCOME AT RS. 2,50,360/-. I N THE SCRUTINY ASSESSMENT COMPLETED ON 25-08-2016, THE AO HAS MADE DISALLOWANCE OF RS. 4,46,400/- ON ACCOUNT OF CASH PAYMENT FOR PURCH ASE OF A NEW CAR OUT OF TOTAL COST OF RS. 16,46,400/-. SINCE THE BALANCE AMOUNT OF RS. 12.00 LACS WAS GOT FINANCED FROM THE BANK, THEREFORE, THE AMOUNT PAID IN CASH BY THE ASSESSEE WAS DISALLOWED AND ADDED BACK TO TH E INCOME OF THE ASSESSEE BY THE AO. THE ASSESSEE CHALLENGED THE ACT ION OF THE AO BEFORE THE LD. CIT(A) AND SUBMITTED THAT THE ASSESSEE SOLD ITS OLD MARUTI SWIFT CAR FOR A CONSIDERATION OF RS. 3.11 LACS FOR WHICH THE ASSESSEE FILED THE CONFIRMATION AND AFFIDAVIT OF THE PURCHASER AND AL SO GIVEN THE PARTICULARS OF REGISTRATION NUMBER OF THE SAID CAR. THE BALANC E AMOUNT OF RS. 1,35,400/- WAS EXPLAINED BY THE ASSESSEE OUT OF OLD SAVINGS AND RENTAL INCOME UPTO THE DATE OF PURCHASE OF A NEW CAR. THE ASSESSEE ALSO ITA NO.626/JP/2018 SHRI RAVI YADAV VS ITO, WARD- 2(3), JAIPUR 3 PRODUCED THE REGISTRATION CERTIFICATE OF OLD CAR BE FORE THE LD. CIT(A). HOWEVER, THE SAME WAS NOT ADMITTED BY THE LD. CIT(A ) ON THE GROUND THAT THE ASSESSEE HAS NOT FILED ANY APPLICATION UNDER 46 A OF INCOME TAX RULES, 1962. CONSEQUENTLY, THE LD. CIT(A) HAS CONFI RMED THE ADDITION MADE BY THE AO. 2.3 BEFORE US, THE LD.AR OF THE ASSESSEE SUBMITTED THAT THE ASSESSEE HAS EXPLAINED THE SOURCE OF PAYMENT OF RS. 4,46,400/- B EING THE SALE PROCEEDS OF OLD CAR AS WELL AS PAST SAVINGS OF THE ASSESSEE AND RENTAL INCOME. HOWEVER, THE AO HAS NOT ACCEPTED THE EXPLANATION OF THE ASSESSEE ON THE GROUND THAT THE ASSESSEE HAS NOT PRODUCED REGISTRAT ION CERTIFICATE OF OLD CAR. THE LD.AR OF THE ASSESSEE FURTHER CONTENDED TH AT THE ASSESSEE THEREAFTER OBTAINED THE COPY OF REGISTRATION CERTIF ICATE OF OLD CAR AND THE SAME WAS PRODUCED BEFORE THE LD. CIT(A). HOWEVER, THE LD. CIT(A) HAS DECLINED TO ADMIT THE SAID DOCUMENTARY EVIDENCE AND FURTHER RAISED AN OBJECTION ABOUT THE STATUS OF REPAYMENT OF LOAN TAK EN BY THE ASSESSEE FOR PURCHASE OF OLD CAR IN THE F.Y. 2008-09. THE LD.AR OF THE ASSESSEE SUBMITTED THAT THE ASSESSEE HAD ALREADY REPAID THE SAID LOAN BEFORE TRANSFER OF OLD CAR. THE ASSESSEE PRODUCED THE COPY OF HDFC LOAN BANK ACCOUNT TO SHOW THAT THE LOAN WAS REPAID BY THE ASS ESSEE BEFORE TRANSFER ITA NO.626/JP/2018 SHRI RAVI YADAV VS ITO, WARD- 2(3), JAIPUR 4 OF OLD CAR. THUS THE LD.AR OF THE ASSESSEE SUBMITTE D THAT THE ASSESSEE HAS PRODUCED ALL THE DOCUMENTARY EVIDENCES OF TRANSFER OF OLD CAR, CONFIRMATION OF THE PURCHASER, PAST SAVINGS AND REN TAL INCOME OF THE ASSESSEE FOR PAYMENT OF THE AMOUNT TO THE EXTENT OF RS. 1,35,400/- BEFORE THE LOWER AUTHORITIES. THUS THE LD.AR OF THE ASSESS EE SUBMITTED THAT THE ADDITION MADE BY THE AO MAY BE DELETED. 2.4 ON THE OTHER HAND, LD. DR SUBMITTED THAT THE AS SESSEE IS NOT HAVING SUFFICIENT RENTAL INCOME FOR MAKING PAYMENT OF CASH OF RS. 4,46,400/-. FURTHER, THE ASSESSEE DID NOT FILE THE REGISTRATION CERTIFICATE OF OLD CAR BEFORE THE AO AS WELL AS THE STATUS OF REPAYMENT OF LOAN TAKEN BY THE ASSESSEE FROM THE BANK FOR PURCHASE OF OLD CAR. THE REFORE, THE ASSESSEE FAILED TO DISCHARGE HIS ONUS TO EXPLAIN THE SOURCE OF PAYMENT OF RS. 4,46,400/-. THE LD. DR RELIED ON THE ORDERS OF THE LOWER AUTHORITIES. 2.5 WE HAVE HEARD THE RIVAL SUBMISSIONS AS WELL AS CONSIDERED THE RELEVANT MATERIALS AVAILABLE ON RECORD. WHEN THE AO HAS ASKED THE ASSESSEE TO EXPLAIN THE SOURCE OF PAYMENT OF RS. 4, 46,400/- FOR PURCHASE OF NEW CAR THEN THE ASSESSEE FILED THE AFFIDAVIT BE FORE THE AO EXPLAINING THE SOURCE THAT SUM OF RS. 3.11 LACS IS THE SALE PR OCEEDS OF OLD MARUTI SWIFT CAR BEARING REGISTRATION NO. RJ-14-CF-1176 SO LD TO ONE SHRI ITA NO.626/JP/2018 SHRI RAVI YADAV VS ITO, WARD- 2(3), JAIPUR 5 GORDHAN YADAV. THE ASSESSEE HAS ALSO GIVEN THE FULL PARTICULARS AND ADDRESS OF THE PURCHASER ALONGWITH AFFIDAVIT OF THE PURCHASER. IN THE AFFIDAVIT, THE PURCHASER SHRI GORDHAN YADAV HAS CON FIRMED THE PURCHASE OF THE SAID MARUTI SWIFT CAR FROM THE ASSESSEE FOR A CONSIDERATION OF RS. 3.11 LACS. THE ASSESSEE HAS EXPLAINED THE SALE OF O LD MARUTI SWIFT CAR GIVING FULL PARTICULARS OF REGISTRATION NUMBER OF T HE OLD CAR AS WELL AS THE AFFIDAVIT OF THE PURCHASER AND THE ASSESSEE WAS NOT ABLE TO PRODUCE REGISTRATION CERTIFICATE DUE TO THE REASON THAT THE ASSESSEE HAD ALREADY HANDED OVER THE REGISTRATION CERTIFICATE TO THE NEW OWNER AND DID NOT KEEP ANY COPY OF OLD CAR PAPERS. THUS BEFORE REJECT ING THE SAID EXPLANATION OF THE ASSESSEE, THE AO OUGHT TO HAVE V ERIFIED THIS FACT EITHER BY EXAMINING THE PURCHASER OR FROM RTO OFFICE. TH E ASSESSEE VIDE LETTER DATED 12-08-2016 HAS EXPLAINED THESE FACTS B EFORE THE AO. FURTHER, THE ASSESSEE ALSO PRODUCED THE SALE LETTER/ AGREEME NT BEFORE THE AO IN SUPPORT OF HIS CLAIM OF SALE OF OLD CAR. ONCE THIS FACT OF ASSESSEE HAVING MARUTI SWIFT CAR WHICH WAS PURCHASED IN THE F.Y. 2 008-09 AND THE SAME WAS TRANSFERRED BEFORE THE NEW CAR IS PURCHASED BY THE ASSESSEE ARE AVAILABLE IN THE PUBLIC DOMAIN BEING RTO OFFICE THE N THE SAID EXPLANATION OF THE ASSESSEE CANNOT BE TURNED DOWN W ITHOUT CONDUCTING ITA NO.626/JP/2018 SHRI RAVI YADAV VS ITO, WARD- 2(3), JAIPUR 6 ANY FURTHER ENQUIRY. BEFORE THE LD. CIT(A), THE ASS ESSEE HAS DULY FILED THE COPY OF REGISTRATION CERTIFICATE OF OLD CAR BUT THE LD. CIT(A) DECLINED TO ACCEPT THE SAME ON TECHNICAL GROUND. IT IS PERTINEN T TO NOTE THAT COPY OF REGISTRATION CERTIFICATE IS NOT THE DOCUMENT CREATE D BY THE ASSESSEE BUT IT IS ISSUED BY TRANSPORT AUTHORITY AND THEREFORE, THERE IS NO SCOPE OF ANY MANIPULATION BY THE ASSESSEE. A DOCUMENT WHICH IS I SSUED BY THE GOVT DEPARTMENT CAN ALSO BE VERIFIED INDEPENDENTLY AND R EFUSAL OF THE SAID DOCUMENT BY THE LD. CIT(A) IS ARBITRARY AND UNJUSTI FIED. THE LD. CIT(A) HAS RAISED THE FRESH OBJECTION REGARDING THE STATUS OF REPAYMENT OF LOAN TAKEN BY THE ASSESSEE FOR PURCHASE OF OLD CAR. ONC E THE SAID OBJECTION IS RAISED BY THE LD. CIT(A) THEN THE ASSESSEE OUGHT TO HAVE BEEN GIVEN AN OPPORTUNITY TO EXPLAIN THE SAME AND TO PRODUCE THE RELEVANT DOCUMENT. THE ASSESSEE HAS FILED THE COPY OF THE LOAN ACCOUNT WITH HDFC BANK SHOWING REPAYMENT OF LOAN PRIOR TO SALE OF OLD CAR. THEREFORE, IN THE FACTS AND CIRCUMSTANCES OF THE CASE, WE FIND THAT THE ASS ESSEE HAS DULY EXPLAINED THE SOURCE TO THE EXTENT OF RS. 3.11 LACS BEING THE SALE CONSIDERATION OF OLD CAR SOLD BY THE ASSESSEE. AS R EGARDS THE BALANCE AMOUNT OF RS. 1,35,400/-, ONCE THE ASSESSEE IS A RE GULAR INCOME TAX ASSESSEE AND ALSO DECLARED THE TOTAL INCOME AT RS. 2,50,356/- FOR THE YEAR ITA NO.626/JP/2018 SHRI RAVI YADAV VS ITO, WARD- 2(3), JAIPUR 7 UNDER CONSIDERATION THEN THE RENTAL INCOME OF THE A SSESSEE AS WELL AS PAST SAVINGS CANNOT BE DENIED FOR SUCH A SMALL AMOUNT OF RS. 1,35,400/-. HENCE, IN VIEW OF THE ABOVE DISCUSSIONS AND FACTS O F THE CASE, WE HOLD THAT THE ASSESSEE HAS EXPLAINED THE SOURCE OF PAYME NT OF RS. 4,46,400/- AND THE ADDITION MADE BY THE AO AND CONFIRMED BY TH E LD. CIT(A) IS HIGHLY ARBITRARY AND UNJUSTIFIED WHICH IS DELETED. THUS THE APPEAL OF THE ASSESSEE IS ALLOWED. 3.0 IN THE RESULT, THE APPEAL OF THE ASSESSEE IS AL LOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 13/01 /2020. SD/- SD/- FOE FLAG ;KNO FOT; IKY JKO (VIKRAM SINGH YADAV) (VIJAY PAL RAO) YS[KK LNL;@ ACCOUNTANT MEMBER U;KF;D LNL;@ JUDICIAL MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 13 /01/ 2020 *MISHRA VKNS'K DH IZFRFYFI VXZSFKR@ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ@ THE APPELLANT- SHRI RAVI YADAV, JAIPUR 2. IZR;FKHZ@ THE RESPONDENT- THE ITO, WARD- 2(3), JAIPUR 3. VK;DJ VK;QDRVIHY ) @ CIT(A), 4. VK;DJ VK;QDR@ CIT, 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ@ DR, ITAT, JAIPUR 6. XKMZ QKBZY@ GUARD FILE (ITA NO.626/JP/2018) VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ@ ASSISTANT. REGISTRAR