Pranav Sukhdevbhai Patel, Ahmedabad V. Income Tax Officer, Ward-15(2), Ahmedabad

ITA 662/AHD/2016

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 8198 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 2 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-06-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: Not Allotted
• Assessment Year: 2011-2012
• Appeal Filed On: 15-03-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Unexplained cash credit; Deemed to accrue or arise in india; Additional evidence
• Section: 131; 68

Judgement Text

, ,LK ,LK,LK ,LK- -- -,E ,E,E ,E- -- -LH LHLH LH IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH, AHMEDABAD OLHE VGEN] OLHE VGEN] OLHE VGEN] OLHE VGEN] YS[KK LNL; YS[KK LNL; YS[KK LNL; YS[KK LNL; , BEFORE SHRI RAJPAL YADAV, JUDICIAL MEMBER AND SHRI WASEEM AHMED, ACCOUNTANT MEMBER ./ I.T.A. NO.662/AHD/2016 ( / ASSESSMENT YEAR : 2011-12) SHRI PRANAV SUKHDEVBHAI PATEL, 12, SHANTI PALACE, 100FT. RING ROAD, THALTEJ, AHMEDABAD 380 059 / VS. ITO, WARD 15(2), AHMEDABAD. ./ ./ PAN/GIR NO. : AKIPP 6646 B ( / APPELLANT ) .. ( !' / RESPONDENT ) # / APPELLANT BY : SHRI ASEEM THAKKAR, A.R. !' $ # / RESPONDENT BY : SHRI SAURABH SINGH, SR.D.R. % &' $ () / DATE OF HEARING 28/05/2018 *+,- $ () / DATE OF PRONOUNCEMENT 08/06/2018 . / O R D E R PER WASEEM AHMED, ACCOUNTANT MEMBER: THE CAPTIONED APPEAL HAS BEEN FILED AT THE INSTANCE OF THE ASSESSEE AGAINST THE APPELLATE ORDER OF THE COMMISSIONER OF INCOME TAX(APPEALS)-7, AHMEDABAD [CIT(A) IN SHORT] VIDE APPEAL NO.CIT(A)7/3/15-16 DATED 18/12/2015 ARISING IN THE ASSESSMENT ORDER PASSED UNDER S.143(3) OF THE INCOME TAX ACT, 1961 ( FROM NOW ON REFERRED TO AS 'THE ACT') DATED 10/03/2014 RELEVAN T TO ASSESSMENT YEAR (AY) 2011-12. ITA NO.662/AHD/2016 SHRI PRANAV SUKH DEVBHAI PATEL VS. ITO ASST.YEAR 2011-12 - 2 - 2. THE GROUNDS OF APPEAL RAISED BY THE ASSESSEE ARE AS UNDER:- 1. THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS ) HAS ERRED IN CONFIRMING THE ADDITION OF RS.7,51,000/- MADE BY TH E ASSESSING OFFICER FOR THE ALLEGED DEEMED INCOME U/S.68 OF THE I.T. ACT,1961. 2. THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED IN CONFIRMING THE ADDITION TO THE EXTENT OF RS.2,77,16 5/-OUT OF ADDITION OF RS.5,03,715/- MADE BY THE ASSESSING OFF ICER FOR THE ALLEGED COMMISSION INCOME. 3. THE APPELLANT CRAVES LEAVE TO ADD, ALT ER, AMEND OR MODIFY ANY OF THE GROUNDS OF APPEAL ON OR BEFORE TH E DATE OF HEARING OF APPEAL. 3. AT THE OUTSET LEARNED COUNSEL FOR THE ASSESSEE S UBMITTED THAT HE HAS BEEN INSTRUCTED BY THE ASSESSEE NOT TO PRESS GROUND NO.2, THEREFORE WE DISMISS THE SAME AS NOT PRESSED. 4. THE ISSUE RAISED BY THE ASSESSEE IN GROUND NO.1 IS THAT LEARNED CIT(A) ERRED IN CONFIRMING THE ADDITION MADE BY THE AO FOR RS.7,51,000/- U/S 68 OF THE ACT. 5. BRIEFLY STATED FACTS ARE THAT THE ASSESSEE IS AN INDIVIDUAL AND DERIVING HIS INCOME UNDER THE HEAD SALARY AND HOUSE PROPERTY. THE ASSESSEE DURING THE YEAR CLAIMED THAT HE HAD RECEIV ED AN ADVANCE OF RS. 7,51,000/- FROM SHRI JWALIT PARMAR AGAINST THE SALE OF PROPERTY LOCATED AT DARBAR BAGICHA HOUSE, SANAND. THE ASSESSEE DURING T HE ASSESSMENT PROCEEDINGS SUBMITTED THAT THE IMPUGNED PROPERTY WA S SOLD TO MR. JWALIT PARMAR BY BANA DOCUMENTS. THE ASSESSEE IN SUPPORT OF HIS CLAIM FIL ED A ITA NO.662/AHD/2016 SHRI PRANAV SUKH DEVBHAI PATEL VS. ITO ASST.YEAR 2011-12 - 3 - COPY OF RECEIPT VOUCHER DATED 09-04-2010 AND XEROX COPY OF THE PAN OF SHRI JWALIT PARMAR. THE ASSESSEE DURING THE ASSESSMENT PROCEEDINGS FURT HER SUBMITTED THAT THERE WAS NO AGREEMENT IN WRITING FOR THE SALE OF S UCH PROPERTY AS BANAKHAT . THUS, THE PROPERTY WAS TRANSFERRED BY ORAL COMMIT MENT. HOWEVER, THE ASSESSEE FILED THE COPY OF CONFIRMATIO N FROM SHRI JWALIT PARMAR. THE ASSESSEE ALSO SUBMITTED THAT SUBSEQUENT LY THE DEAL FOR THE TRANSFER OF PROPERTY WAS NOT MATERIALIZED AND THE M ONEY WAS SUBSEQUENTLY RETURNED IN THE NEXT YEAR. THE ASSESSEE FURTHER SUBMITTED THAT IN FACT, SHRI J WALIT PARMAR WAS ACTING AS A MEDIATOR FOR THE TRANSFER OF THE ASSESSEE TO T HE THIRD PARTY AS THE DEAL WAS CANCELED IN THIS SUBSEQUENT YEAR. THE AMOUNT OF MONEY RECEIVED FOR RS.7.51 LACS WAS RETURNED TO THE PARTY. HOWEVER, THE AO DURING THE ASSESSMENT PROCEEDINGS O BSERVED CERTAIN FACTS AS DETAILED UNDER: I. NO PRUDENT PERSON WILL MAKE THE PAYMENT OF THE TOKE N AMOUNT IN CASH FOR RS. 7.51 LACS WITHOUT HAVING ANY UNDERS TANDING IN WRITING. II. THE ASSESSEE ORIGINALLY SUBMITTED THAT THE CASH WAS RECEIVED FROM SHRI JWALIT PARMAR IN CONNECTION WITH THE TRAN SFER OF PROPERTY BUT SUBSEQUENTLY THE ASSESSEE HAS CHANGED HIS STANDBY SUBMITTING THAT THERE WAS ANOTHER THIRD PARTY, WHIC H WAS INTERESTED IN BUYING THE PROPERTY. ITA NO.662/AHD/2016 SHRI PRANAV SUKH DEVBHAI PATEL VS. ITO ASST.YEAR 2011-12 - 4 - III. SHRI JWALIT PARMAR WAS NOT THE REAL PURCHASER AND T HE IDENTITY OF THE REAL PURCHASER WAS NOT REVEALED DURING THE A SSESSMENT PROCEEDINGS. IN VIEW OF ABOVE, THE AO TREATED THE AMOUNT RECEIVE D BY THE ASSESSEE FOR RS.7.51 LACS DURING THE YEAR AS UNEXPLAINED CASH CR EDIT U/S 68 OF THE ACT AND ACCORDINGLY, ADDED TO THE TOTAL INCOME OF THE A SSESSEE. 6. AGGRIEVED ASSESSEE PREFERRED AN APPEAL TO LEARNE D CIT(A). THE ASSESSEE BEFORE THE LEARNED CIT(A) SUBMITTED THAT H E HAS DISCHARGED HIS DUTY BY FURNISHING THE NECESSARY DETAILS OF SHRI JW ALIT PARMAR INCLUDING PAN AND THE CONFIRMATION. BUT THE AO WITHOUT VERIFY ING THE SUBMISSION OF THE ASSESSEE HAS TREATED THE AMOUNT OF RS.7.51 L ACS AS UNEXPLAINED CASH CREDIT IN HIS HANDS. THE DETAILS OF SHRI JWALIT PARMAR WERE GIVEN AT LEA ST 3 MONTHS BEFORE THE ASSESSMENT GETTING TIME-BARRED. THEREFORE, IT IS NO T THE CASE THAT THE AO DID NOT HAVE SUFFICIENT TIME FOR CONDUCTING THE NEC ESSARY INQUIRIES. WITHOUT EXECUTING ANY DOCUMENT FOR THE RECEIPT OF R S.7.50 LACS IN WRITING DOES NOT LEAD TO CONCLUDING THAT THE MONEY RECEIPT IS BOGUS. THE ASSESSEE ALSO FILED ADDITIONAL EVIDENCE BEFORE THE LEARNED C IT(A) BY FURNISHING THE CONFIRMATION OF THE ACTUAL BUYER OF SHRI PRITHV ISINGH BABUSINGH JADAV ALONG WITH HIS PAN. THE LEARNED CIT(A) CALLED FOR THE REMAND REPORT FRO M THE AO ON THE ADDITIONAL DOCUMENTS FILED BY HIM. HOWEVER, THE AO WITHOUT VERIFYING ITA NO.662/AHD/2016 SHRI PRANAV SUKH DEVBHAI PATEL VS. ITO ASST.YEAR 2011-12 - 5 - THE VERACITY OF THE DOCUMENTS REFUSED TO ACCEPT THE ADDITIONAL EVIDENCE FILED BY THE ASSESSEE DURING THE APPELLATE PROCEEDI NGS. HOWEVER, LEARNED CIT(A) ADMITTED THE ADDITIONAL EVI DENCE AFTER SATISFYING THE CONDITIONS SPECIFIED UNDER RULE 46A OF INCOME TAX RULE BUT CONFIRMED THE ADDITION MADE BY THE AO BY OBSERV ING AS UNDER: 6.2 I HAVE CONSIDERED THE ASSESSMENT ORDER AND TH E SUBMISSIONS MADE BY THE APPELLANT. THE AO ADDED THE AMOUNT OF R S.7,51,000/- U/S. 68 OF THE I.T. ACT TO THE APPELLANT'S INCOME AS THE APPELLANT COULD NOT OFFER A SATISFACTORY EXPLANATION FOR THE SAME. DURI NG THE APPELLATE PROCEEDINGS, THE APPELLANT SUBMITTED PAN, ADDRESS A ND CONFIRMATION OF SHRI JWALIT PARMAR, WHO ACTED AS A MIDDLEMAN WITH R ESPECT TO THE TRANSACTION OF PROPERTY FOR WHICH THIS AMOUNT WAS R ECEIVED. A PERUSAL OF THE ASSESSMENT ORDER SHOWS THAT INITIALLY DURING THE ASSESSMENT PROCEEDINGS, THE APPELLANT STATED THAT THIS AMOUNT HAD BEEN RECEIVED FROM SHRI JWALIT PARMAR AS THE BANA AMOUNT OF PROPE RTY AT SANAND. IT WAS STATED THAT THERE WAS NO WRITTEN AGREEMENT IN R ESPECT OF THIS TRANSACTION. HOWEVER, DURING THE ASSESSMENT PROCEED INGS ITSELF, THE APPELLANT STATED THAT THIS AMOUNT DID NOT PERTAIN T O SHR JWALIT PARMAR BUT TO THE ACTUAL PURCHASER WHO WAS NOT KNOWN TO TH E APPELLANT AND SINCE SHRI JWALIT PARMAR WAS A MIDDLEMAN, HIS N AME HAD BEEN NOTED BY HIM. DURING THE APPELLATE PROCEEDINGS, T HE APPELLANT HAS REITERATED WHAT WAS STATED BEFORE THE AO. I FIND TH AT THERE ARE NO DOCUMENTARY EVIDENCES IN RESPECT OF THIS TRANSACTIO N OF RS.7,51,000/- EITHER WITH SHRI JWALIT PARMAR OR WITH THE PURCHASE R. MOREOVER, IT IS SEEN THAT THE APPELLANT HAS SUBMITTED CONFIRMATION, PAN, ETC. OF SHRI JWALIT PARMAR WHEREAS THE PURCHASER IS SAID TO BE SOMEBODY ELSE. THUS, EXPLAINING THE CREDENTIALS OF SHRI JWALIT PARMAR DOES NOT DISCHARGE THE ONUS CAST UPON THE APPELLANT OF PROVI NG THE CREDITWORTHINESS OF THE DEPOSITOR OF THIS AMOUNT OR THE GENUINENESS OF THE TRANSACTION. NOWHERE IN HIS SUBMISSION HAS THE APPELLANT EVEN MENTIONED THE NAME AND ADDRESS OF THE ACTUAL PURCHA SER. IN VIEW OF THESE FACTS, LAM INCLINED TO AGREE WITH THE AO THAT THE GENUINENESS OF THE TRANSACTION IS NOT PROVED AND ACCORDINGLY, THE AMOUNT OF RS.7,51,000/- ADDED U/S. 68 IS CONFIRMED. GROUND OF APPEAL NO.3 IS DISMISSED. ITA NO.662/AHD/2016 SHRI PRANAV SUKH DEVBHAI PATEL VS. ITO ASST.YEAR 2011-12 - 6 - BEING AGGRIEVED BY ORDER OF LD. CIT(A) THE ASSESSEE IS IN THE SECOND APPEAL BEFORE US. THE LEARNED AR BEFORE US FILED A PAPER BOOK, WHICH IS RUNNING FROM PAGES 1 TO 12 AND SUBMITTED THAT ALL THE DETAILS AB OUT THE ACTUAL PURCHASER AND THE MEDIATOR WERE FURNISHED BEFORE THE LOWER AU THORITIES AND NO DEFECT OF WHATSOEVER WAS POINTED OUT BY THEM. THE FINDING OF THE LEARNED CIT(A) THAT THE ASSESSEE FAILED TO FURNISH THE DETAILS OF THE ACTUAL PURCHASER IS BASED ON THE WRO NG ASSUMPTION OF FACTS. THE LEARNED AR IN SUPPORT OF HIS CLAIM DREW OUR ATT ENTION ON THE SUBMISSIONS MADE BEFORE THE LEARNED CIT(A) DURING T HE APPELLATE PROCEEDINGS WHICH ARE PLACED ON PAGE 11 OF THE PAPE R BOOK. THE LEARNED AR ALSO SUBMITTED THAT THE AMOUNT RECEIVED FROM THE PURCHASER WAS RETURNED IN THE SUBSEQUENT YEAR AS THE DEAL FOR THE PROPERTY WAS NOT MATERIALIZED. ON THE HAND, THE LEARNED DR SUBMITTED THAT THE FACT WHETHER MONEY WAS RETURNED TO THE PURCHASER IS NOT DISCERNIBLE FROM T HE ORDER OF LOWER AUTHORITIES. THE ASSESSEE NOWHERE HAS FURNISHED THE CREDITWORTHINESS OF THE PARTY. THEREFORE, MONEY RECEIVED FOR RS.7.51 LA CS BY THE ASSESSEE REPRESENTS THE UNEXPLAINED CASH CREDIT U/S 68 OF TH E ACT. LEARNED DR VEHEMENTLY SUPPORTED THE ORDER OF AUTHORITIES BELOW . 7. WE HAVE GONE THROUGH THE RIVAL CONTENTIONS AND P ERUSED THE MATERIALS AVAILABLE ON RECORD. THE DISPUTE, IN THIS CASE, RELATES TO THE ADVANCE RECEIVED BY THE ASSESSEE FOR RS.7.51 LACS, WHICH WAS TREATED BY ITA NO.662/AHD/2016 SHRI PRANAV SUKH DEVBHAI PATEL VS. ITO ASST.YEAR 2011-12 - 7 - THE LOWER AUTHORITIES AS UNEXPLAINED CASH CREDIT UN DER SECTION 68 OF THE ACT. THE LEARNED CIT(A) HAS TREATED THE MONEY RECEI VED FOR RS.7.51 LACS AS AN UNEXPLAINED CASH CREDIT BY OBSERVING THAT THE ASSESSEE FAILED TO FURNISH THE NECESSARY DETAILS OF THE ACTUAL PURCHAS ER. HOWEVER, ON PERUSAL OF THE SUBMISSION OF THE ASSESSEE AS RECORDED IN TH E ORDER OF LEARNED CIT(A), WE NOTE THAT THE ASSESSEE HAS FURNISHED THE CONFIRMATION FROM THE ACTUAL PURCHASER ALONG WITH HIS PAN NUMBER. THE RELEVANT EXTRACT OF THE SUBMISSION OF THE ASSESSEE AS RECORDED IN THE O RDER OF LD. CIT-A IS REPRODUCED AS UNDER: 5.1 IN ANY CASE THE APPELLANT IS ALSO FURNISHING T HE CONFIRMATION OF THE AGRICULTURIST SHRI PRITHVISINGH BABUSINGH JADAV WHO HAD PROPOSED TO BUY THIS LAND AND HAD MADE TOKEN PAYMENT OF RS.7 .50 LACS. THE COPY OF THE LAND RECORDS AS WELL AS PAN IS FURNISHING BY WAY OF ADDITIONAL EVIDENCE. CONFIRMATION OF SHRI JWALIT PARMAR THAT H E HAD INTRODUCED THE AFORESAID PERSON FOR BUYING MY LAND AND HAD ADV ANCED BANA AMOUNT OF RS.7.50 LACS IS ALSO FURNISHED BY WAY OF ADDITIONAL EVIDENCE. FROM THE PRECEDING DISCUSSION, WE NOTE THAT THE NEC ESSARY DETAILS WERE DULY SUPPLIED BY THE ASSESSEE REGARDING THE ACTUAL PURCHASER OF THE PROPERTY AS WELL AS THE MIDDLEMAN, BUT NONE OF THE AUTHORITY HAS VERIFIED THE CREDENTIAL OF THE PARTIES. THE INCOME TAX AUTHO RITIES HAVE BEEN EMPOWERED TO VERIFY THE GENUINENESS OF THE TRANSACT ION UNDER SECTION 133(6)/ 131 OF THE ACT BUT FAILED TO EXERCISE THE S AME IN THE GIVEN FACTS & CIRCUMSTANCES. THEREFORE, WE HOLD THAT THE LOWER AU THORITIES HAVE MADE THE ADDITION WITHOUT VERIFYING THE DETAILS FILED BY THE ASSESSEE. IT IS PERTINENT TO NOTE THAT THE ASSESSEE HAS DISCHARGED HIS ONUS BY FURNISHING THE NECESSARY DETAILS OF THE PARTIES AS DISCUSSED A BOVE. ACCORDINGLY, WE OBSERVE THAT NO INFIRMITY HAS BEEN POINTED OUT BY T HE LOWER AUTHORITIES IN THE SUBMISSION OF THE ASSESSEE. GIVEN ABOVE, WE HAV E NO HESITATION IN ITA NO.662/AHD/2016 SHRI PRANAV SUKH DEVBHAI PATEL VS. ITO ASST.YEAR 2011-12 - 8 - REVERSING THE ORDER OF AUTHORITIES BELOW. HENCE, TH E GROUND OF APPEAL OF THE ASSESSEE IS ALLOWED. 8. IN THE RESULT, APPEAL FILED BY THE ASSESSEE IS A LLOWED. THIS ORDER PRONOUNCED IN OPEN COURT ON 08/06/2018 SD/- SD/- JKTIKY ;KNO JKTIKY ;KNO JKTIKY ;KNO JKTIKY ;KNO OLHE VGEN OLHE VGEN OLHE VGEN OLHE VGEN U;KF;D LNL; U;KF;D LNL; U;KF;D LNL; U;KF;D LNL; YKS[KK LN YKS[KK LN YKS[KK LN YKS[KK LN L; L; L; L; (RAJPAL YADAV) (WASEEM AHMED) JUDICIAL MEMBER ACCOUNTANT MEMBER AHMEDABAD; DATED 08/06/2018 PRITI YADAV, SR.PS !'# $#! / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. !' / THE RESPONDENT. 3. /01( % 2( / CONCERNED CIT 4. % 2( ( ) / THE CIT(A)-7, AHMEDABAD. 5. 567 !(&01 , ) 01- , 8 / / DR, ITAT, AHMEDABAD 6. 79 :' / GUARD FILE. % & / BY ORDER, ' 5( !( //TRUE COPY// '/& () ( DY./ASSTT.REGISTRAR) , / ITAT, AHMEDABAD 1. DATE OF DICTATION 30/05/2018 (DICTATION-PAD 4 PA GES ATTACHED AT THE END OF THIS FILE) 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER 31/05/2018 3. OTHER MEMBER 4. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR.P. S./P.S 08/06/2018 5. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE D ICTATING MEMBER FOR PRONOUNCEMENT 6. DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR.P .S./P.S. 7. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 8. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK ... 9. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT RE GISTRAR FOR SIGNATURE ON THE ORDER.. 10. DATE OF DESPATCH OF THE ORDER