DCIT, CC - 5(3), MUMBAI V. ALAG NIRMAN PVT. LTD., MUMBAI

ITA 6684/MUM/2019

• Counselvise Citation: [2022] 106 COUNSELVISE.COM (IT) 5145 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 7 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-06-2022
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2012-2013
• Appeal Filed On: 24-10-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Unexplained investment; Sale consideration of property below Jantri Value; Principle of natural justice; Source of fund; Onus to prove; Retraction; TDS
• Section: 32; 147; 131; 68; 246; 69; 145; 27; 148; 54; 37; 6; 56; 263; 63; 132; 12; 28; 144; 10; 90; 154; 2; 11; 15; 271(1)(b); 139; 92; 142(1); 56(2); 133(6); 143(2); 69A; 43

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL “A” BENCH, MUMBAI BEFORE SHRI VIKAS AWASTHY, HON'BLE JUDICIAL MEMBER AND SHRI S. RIFAUR RAHMAN, HON'BLE ACCOUNTANT MEMBER ITA.NO. 6684/MUM/2019 (A.Y: 2012-13) DCIT – 5(3) Room No. 1906, 19 th Floor Air India Building, Nariman Point Mumbai – 400 021 v. M/s. Alag Nirman Pvt. Ltd., 5, BPS Plaza, Devidayal Road Mulund (w), Mumbai - 400080 PAN: AABCH7951F (Appellant) (Respondent) Assessee by : Shri Viraj Mehta Department by : Shri Mehul Jain Date of Hearing : 11.05.2022 Date of Pronouncement : 21.06.2022 O R D E R PER S. RIFAUR RAHMAN (AM) 1. This appeal is filed by the revenue against order of Learned Commissioner of Income-tax (Appeals)-53, Mumbai [hereinafter for short "Ld. CIT(A)] dated 26.08.2019 for the A.Y.2012-13. 2. Brief facts of the case are, assessee filed its return of income on 23.09.2011 declaring total income of ₹.NIL. The case was selected for 2 ITA.NO. 6684/MUM/2019 (A.Y: 2012-13) M/s. Alag Nirman Pvt. Ltd., scrutiny under CASS and notices u/s. 143(2) and 142(1) of Income-tax Act, 1961 (in short “Act”) the Act were issued and served on the assessee. In response AR of the assessee attended and filed relevant information as called for. 3. During the assessment proceedings Assessing Officer observed that assessee has taken loans from M/s. Josh Trading Co. Pvt. Ltd., and M/s.Olive Overseas P. Ltd., (Realgold Trading Co. P. Ltd.,) which are the concerns operated by Shri Praveen Kumar Jain (for short “PKJ”). Assessing Officer observed that assessee has taken total loan of ₹.1.25 Crores during the year under consideration. In order to verify the genuineness of the loan transaction summons were issued to the above said concerns through Registered Post, these summons were returned unserved. Subsequently when the assessee was asked to give details assessee has submitted proper addresses and accordingly fresh summons were issued to those parties. Since no response from the parties, assessee was asked to substantiate the genuineness of the transaction. The Assessing Officer made certain enquiries and came to the conclusion that lender companies are non-existent and accordingly, issued show cause notice to the assessee why addition u/s. 68 of the Act should be made. In response assessee has submitted loan confirmation documents and no 3 ITA.NO. 6684/MUM/2019 (A.Y: 2012-13) M/s. Alag Nirman Pvt. Ltd., other submissions were made. Based on the information on record that these companies are controlled by PKJ the Assessing Officer after considering the affidavits and communication submitted by the assessee came to the conclusion that lender companies are non-existent, accordingly, made addition u/s. 68 of the Act. 4. Further, Assessing Officer after observing AIR information that assessee had purchased land on 06.04.2010 of ₹.3,15,96,000/- on 23.09.2011 of ₹.2,92,99,000/- and on 06.04.2011 of ₹.67,80,000/-, when the assessee was asked to explain the details of the above investments, in response assessee filed two copies of deed dated 23.09.2011 and 06.04.2011 for the value of ₹.3,15,96,000/- and ₹.2,92,99,000/- respectively. The Assessing Officer observed that assessee has not submitted any explanation on the source of the above investments after verifying the values declared in the balance sheet and the information as per AIR, Assessing Officer observed that the difference of ₹.4,04,01,760/- for which assessee failed to explain the difference and source of investments. Therefore, Assessing Officer in the absence of explanation on the detailed investments towards land, he treated above investment as unexplained investment and made addition u/s. 69 of the Act to the extent of ₹.2,76,75,000/-. 4 ITA.NO. 6684/MUM/2019 (A.Y: 2012-13) M/s. Alag Nirman Pvt. Ltd., 5. Aggrieved assessee preferred an appeal before the Ld.CIT(A) and Ld.CIT(A) after considering the submissions of the assessee, he deleted the additions proposed by the Assessing Officer with the following observations: - “5.15. A perusal of the cases cited by the appellant shows that facts of the appellant are similar to the cases relied upon. The same Pravin Jain entities are involved in those cases. Loans taken were interest bearing and were repaid. The two entities are filing returns, copy of their bank statements and financials are filed. The initial onus cast upon the appellant was discharged and the assessing officer has not dislodged it, even though opportunity was given in the remand proceedings. The statements relied upon by the Assessing Officer has been retracted. The Assessing Officer has not reexamined the parties and disproved their retractions. No evidence of cash tails or analysis of bank statements of lender to support his conclusion has been brought on record by the Assessing Officer.” 6. With regard to addition made u/s. 69A of the Act, Ld.CIT(A) after considering the detailed submissions of the assessee once again he deleted the additions made by the Assessing Officer with the following observations: - “6.6. I have considered the submissions carefully. Details comprising the three purchase agreements were filed in the assessment proceedings. It appears that the assessing officer did not examine the documents properly and hurriedly drew his conclusions which prima facie are erroneous. The difference based on stamp duty ready reckoner value has been compared with the figures appearing in the balance sheet which is based on stated consideration. Further the assessing officer has added the entire amount of purchases as per AIR and that too the ready reckoner value. In the appellate proceedings, the appellant was asked for the reconciliation. The appellant was also asked why the difference between ready reckoner value and the stated consideration should not be brought to tax. Explanations were filed. 5 ITA.NO. 6684/MUM/2019 (A.Y: 2012-13) M/s. Alag Nirman Pvt. Ltd., 6.7. Perusal of the explanation shows that the closing stock of land as on 31.3.2011 as per Balance Sheet was Rs 23,38,88,850/- which included two lands purchased with agreement value Rs 63,00,000/- and Rs 3,06,00,000/- purchased vide agreement dated 30.12.2010 totaling to Rs 3,69,00,000/- These purchase agreements were registered on 6.4.2011 and hence was reflected in AIR information for FY 2011-12. The closing stock of land as on 31.3.2012 as per Balance Sheet was Rs 26,11,62,090/- The purchase of the third land for agreement value Rs 2,51,99,460/- on 23.9.2011 and registered on same date is reflected in the closing balance as on 31.3.2012. The difference between the closing value of land as on I 31.3.2012 and 31.3.2011 is Rs 2,72,73,240/- This is explained by the purchase of this third land at Rs 2,51,99,460/- plus stamp duty and registration fees of Rs 20,73,780/- during the year, totaling to Rs 2,72,73,240/- Thus there is no difference which is unexplained. The copies of the three land purchase agreements filed in appellate proceedings substantiates the claim of the appellant as regards the date of agreements, the date of registration and the consideration and the stamp duty and registration charges. 6.8. It was observed that the purchase consideration is less than the ready reckoner stamp duty value for each of the three purchases. The difference is Rs 4,80,000/- as regards the agreement value Rs 63,00,000/-, Rs 9,96,000/- as regards the agreement value Rs 3,06,00,000/- and Rs 14,76,000/- as regards the agreement value Rs 2,51,99,460/- The appellant has submitted that section 56(2)(vii) came into effect from 1.10.2009 but was applicable to individuals and HUF only. The same became applicable to companies after addition of new clause (x) to section 56(2) w.e.f. 1.4.2017 and hence no addition be made on this issue in the case of the appellant. 6.9. Since all the purchases of land are duly reflected in the books of accounts, there is no amount whose source is unexplained. 6.10. Considering the facts on record, the explanations and the arguments, the addition made by the assessing officer of Rs. 6,76,75,000/- in respect of the information in AIR is unwarranted and proceeds on an incorrect assumption and basis. The same is deleted. Ground of appeal no 5 is allowed.” 6 ITA.NO. 6684/MUM/2019 (A.Y: 2012-13) M/s. Alag Nirman Pvt. Ltd., 7. Aggrieved revenue is in appeal before us raising following grounds in its appeal: - 1. "Considering, the facts and circumstances of the case, whether Ld. CIT (A) was justified in holding the amount received as loans from Josh Trading Co. Pvt. Ltd. And Olive Overseas Pvt. Ltd. were genuine when the genuineness of the transaction was not at all found established because of deliberate non-compliance of notice u/s. 133(6) of the Act and summons u/s. 131 and even when the AO has recorded that these firms had no genuine business and were not traceable."?. 2. "Considering, the facts and circumstances of the case, whether Ld. CIT (A) was justified in holding the amount received as loans from entities controlled and managed by Mr. Pravin Jain as genuine, even though Mr. Pravin Jain in his statement recorded u/s. 132(4), has accepted on oath that these entities were used by him to provide non- genuine loan entries."? 3. "Considering, the facts and circumstances of the case, whether Ld. CIT(A) was justified in holding the amount received as loans from Josh Trading Co. Pvt. Ltd. and Olive Overseas Pvt. Ltd. were genuine merely on the ground that cash trail has not been established by the AO or the opportunity of cross-examination has not been provided to the assessee. The rebuttal of the retraction of Mr. Pravin Jain was even not considered by the Ld. CIT(A) which clearly shows that the statement recorded during the time of search was genuine-one without any threat, coercion and undue influence."? 4. "Considering, the facts and circumstances of the case, whether Ld. CIT(A) was justified in holding that the investment in land of Rs. 6,76,75,000/- was explained without calling for an examination of the source of investment and without affording the department an opportunity to examine the source of investment for the purchase of land."? 5. "Considering, the facts and circumstances of the case, whether Ld. CIT(A) was correct in holding that the investment in land of Rs. 6,76,75,000/- was explained and genuine even when the assessee had incorrectly recorded all such unconcluded purchase of land as assets in all preceding years, the sale deed of which was not effected in that year. Instead of authorizing the AO to conduct complete enquiry of investment made in the purchase of land, the stand of the Id. CIT(A) to hold such advances as purchase of land 7 ITA.NO. 6684/MUM/2019 (A.Y: 2012-13) M/s. Alag Nirman Pvt. Ltd., and a part of land purchased as reflected in the balance sheet of the preceding year is incorrect and bad in law."? The appellant prays that the order of Commissioner of Income-tax (Appeal) on the above ground be set aside and that the DC be restored. The appellant craves leave to amend or alter any grounds or add a new ground which may be necessary.” 8. The Ground No. 1, 2 and 3 are relating to additions made u/s. 68 of the Act and Ground No. 4 and 5 relating to additions made u/s. 69A of the Act. 9. At the time of hearing, Ld. DR submitted as under: - “1. Issue of additions u/s 68 of the Income Tax Act:- I) Findings of A.O:- i) A.O. received information from Investigation wing, Mumbai that assessee had taken bogus accommodation entry in the form of unsecured loans of Rs.1.25 cr through paper companies operated and managed by Shri Pravin Kumar Jain and associates. ii) To verify identity, creditworthiness and genuineness, summon u/s 131 were issued to lender companies on 30/01/2015. But summon were returned with remarks "not known" and "unclaimed". iii) This fact was brought to the notice of assessee vide letter dated 20/02/2015 and assessee was asked to produce the lenders on 27/02/2015. However, no one attended on 27/2/2015. Assessee filed letter dated 04/03/2015 intimating new address of lenders. Summon u/s 131 issued at new address on 04/03/2015; but again none attended. iv) Based on these independent enquiries, A.O. came to the conclusion that lender companies are nonexistent and accordingly, he issued showcase for addition u/s section 68 addition on 23/03/2015; fixing hearing on 27/03/2015. v) On 26/03/2015, only loan confirmation document was submitted. No other submissions were made. Thus, based on independent enquiries and after giving sufficient opportunities to 8 ITA.NO. 6684/MUM/2019 (A.Y: 2012-13) M/s. Alag Nirman Pvt. Ltd., assessee, A.O. came to conclusion that lender companies are non- existent and made additions U/s 68 of the Act. II) Findings of Ld. CIT (A):- [Para 5.10 to Para 5.13, Page 8 to Page 15 of CIT (A) order] i) The lender companies financial statements, ledger confirmation, ITR acknowledgement were filed as Additional Evidences. Initial onus of Assessee was fulfilled. ii) The A.O. relied upon only the statement of Shri Pravin Jain. iii) No evidences of cash trail or analysis of bank statement of lender was done by A.O. iv) Ld. CIT(A) agreed that facts of M/s Shree Laxmi Developers (ITA No. 2562/Mum/2017 dated 29/12/17) and M/s Shreedham Builders in (ITA No. 5589/M/2017 dated 22/06/2018) are similar to the facts of the present case. Para 5.15 Page 14 of CIT(A) order. III) Negation of arguments taken by Ld. CIT(A):- i) Ld. CIT(A) has deleted the additions stating that all documentary evidences are submitted by assessee and thus, assessee has discharged its initial onus. However, the fact that summons issued to Lender Company were returned unserved or the assessee failed to produce the lenders is not at all discussed by Ld. CIT(A). ii) The Ld. CIT(A) stated that A.O. only relied upon the statements of Shri Pravin Jain, which is not correct. The Investigation Report and statement of Shri Pravin Jain was the starting point of enquiry. The A.O. concluded that lender companies are non-existent, based on his own independent enquiries by issuing summons. iii) The facts and findings of the case laws relied upon by Ld. CIT(A) are different from present case : a. In the case of M/s Shree Laxmi Developers, A.O. made addition only on basis of statement of Shri Pravin Jain and there were no other evidences. (Para S.13 Pg.9 of CIT(A) order). Also, in that case, lender responded to notice u/s 133(6) issued by A.O. In present case, there was independent enquiry and no replies by lender to repeated summons. b. In the case of M/s Shreedham Builders; lender companies replied to summons u/s 131 and their statements were recorded on oath. However, in present case, there was no reply from lender companies. 9 ITA.NO. 6684/MUM/2019 (A.Y: 2012-13) M/s. Alag Nirman Pvt. Ltd., Thus, the facts and findings of the two case laws are distinguishable with the facts of the present case. IV) Arguments on creditworthiness of two lender companies:- 1. Josh Trading Pvt. Ltd:- a. Company was incorporated in A.Y. 2011-12. It doesn't have own funds. The reserves are negative. Huge loss incurred in A.Y. 2012-13. b. The Company has no fixed assets as per Balance Sheet. [Page 7 of Assessee's Paperbook] c. Against turnover of Rs.114 Cr., there is no employee expenses, no electricity expenses. This is unusual phenomena for a genuine company. [Page 8 & 11 of Assessee's Paperbook] d. The registered address of company is at Opera House, Mumbai which is an expensive commercial place. But the annual rental expenses is only Rs.40,000 i.e. Rs 3,333 p.m. It is not possible for a genuine entity doing business of more than Rs. 100 crores to get premise at such low rentals in a prime location. (Pg.11 of Assessee's Paperbook) e. To understand the source of funds for the company, we have to look at the Balance Sheet of the company. The Company was able to raise Rs. 25 crores interest free unsecured loans without having any asset in books. There is finance cost of only Rs.13,014 in P & L account. Against this, the loans and advances given by company are Rs.81.5Cr. Thus, apart from borrowings, there are other sources of funds for Company, which are trade payables of Rs. 69.19 Cr. The trade receivables are only Rs. 2.7 Cr. This shows that Company is using funds of its suppliers/creditors to give loans and advance. A genuine company doing actual business won't use such sources for advancing loans. f. No collateral security or loan agreement with assessee. g. No bank statement of Lender Company is submitted. 2. Olive overseas Pvt. Ltd:- a. There is minimal fixed asset of Rs.3 lacs. (Pg.21 of Assessee Paperbook) 10 ITA.NO. 6684/MUM/2019 (A.Y: 2012-13) M/s. Alag Nirman Pvt. Ltd., b. Against turnover of Rs. 43 Cr., there is no closing stock. The inventories of Rs. 12,696 are same as last year. (Pg.21 of Assessee Paperbook) c. The short term loans and advances of Rs.63.4 Cr. are financed through interest free long term borrowings (finance cost of Rs. 18,860) of Rs. 15.75 Cr. and trade payables of Rs. 41.3 Cr. Thus it is seen that entire purchases were on credit, which remained unpaid and this unpaid amount was used to advance loans. A genuine company doing actual business won't use such sources for advancing loans. d. No collateral security or loan agreement with assessee. e. No bank statement of lender company is submitted. V) Arguments on genuineness of the loan transaction: - i) The assessee is a private company and it had NIL revenues during the year. Inspite of such weak financial conditions, it was able to raise Rs. 1.25 Cr. Loan from other two unrelated Private Companies. Inspite of this, the assessee could not provide proper communication address of lender companies. The addresses on ITR of lender company and ledger confirmation were found to be incorrect. The updated address given by assessee on 02/03/2015 was also incorrect. The assessee couldn't produce the lenders. When there is loan transaction between 2 genuine private parties, both the parties have contact with each other. However, this is not established in present case, which raises doubt about the genuineness. ii) There are no collateral or legally enforceable loan agreements between the parties. A genuine lender giving loan to a company having no revenue will require certain collateral or security. Both of these are absent which raises suspicion about genuineness of transaction. VI) Issue of cross-examination and reliance on statement of Shri Pravin Jain: i) it is shown that the additions were made not only on the basis of statements of Shri Pravin Jain or Investigation report of Inv. Wing; but on account of failure of assessee to discharge his onus to prove the existence of lenders and their creditworthiness as well as genuineness of transaction. Issue of cross-examination will arise, only when additions were made solely on basis of third party statements. A.O. has nowhere mentioned that additions are made only on the basis of statement of Mr. Pravin Jam. On this issue, reliance is placed on judgment of Hon'ble ITAT Mumbai bench, in 11 ITA.NO. 6684/MUM/2019 (A.Y: 2012-13) M/s. Alag Nirman Pvt. Ltd., GTC Industries Ltd Vs ACIT (1998) 65 ITD 380, wherein it was held that where statement of witnesses were only secondary and of sub- ordinate material used to buttress main matter connected with amount of additions, it had to be held that there was no denial of principles of natural justice, if witness were not allowed to be cross- examined by assessee. (Para 105 of judgment.) The above arguments are supported by the case laws submitted through separate legal paperbook. Therefore, it is prayed that the additions made by the Assessing Officer may be upheld. 2. Issue of additions on account of unexplained investment in property as per AIR Information:- i) In the assessment order, the Assessing Officer gave a finding that the assessee was unable to reconcile the data of property purchase as per books with the information available in AIR data and the assessee was, also, unable to explain the sources of investments. ii) Ld. CIT(A) gave a finding that the sources are explained, as the investments are reflected in the books of account. However, Ld. CIT(A) neither called for an explanation of the source of investment and without affording the department an opportunity to examine the sources of investments for the purchase of land; as such sources were unsecured loans taken by the assessee which required verification. 10. In support of his above contentions, he relied on the decision of the Hon'ble Delhi High Court in the case of Pr.CIT v. Bikram Singh (2017) 85 taxmann.com 104 (Delhi) and decision of the Coordinate Bench in the case of DCIT v. Leena Power Tech Engineers Pvt ltd, in ITA.No. 1313/Mum/2020 dated 21.09.2021. 11. On the other hand, Ld. AR of the assessee relied on Para No. 4 of the Ld.CIT(A) order and further he submitted that all the informations were already submitted before the Assessing Officer and there are no cash 12 ITA.NO. 6684/MUM/2019 (A.Y: 2012-13) M/s. Alag Nirman Pvt. Ltd., trials in these transactions and lenders were having sufficient funds to finance the loan and most importantly the loans were repaid. In this regard he also brought to our notice Page No. 7 and 8 of the Ld.CIT(A) order and he relied on the findings of the Ld.CIT(A). Further he brought to our notice ledger copies of the parties and submitted that the loans were properly recorded from these two concerns and interest were paid periodically and loans were repaid. 12. With regard to reliance of case law in the case of DCIT v. Leena Power Tech Engineers Pvt ltd, (supra) by the Ld.DR he submitted that the issue involved in the above case is relating to share capital and not relating to unsecured loans. Therefore, the facts in the above case cannot be applied in the present case. 13. With regard to purchases of land he submitted that assessee has purchased three lands properties and two properties were purchased in the earlier Assessment Year and only one property was purchased during this assessment year. The issue involved in this case is only relating to reconciliation and the same was duly submitted before the Assessing Officer and Ld.CIT(A). Ld.CIT(A) has discussed this issue of reconciliation in detail at Para No. 6.6 to 6.8 of the Appellate Order. He relied on the 13 ITA.NO. 6684/MUM/2019 (A.Y: 2012-13) M/s. Alag Nirman Pvt. Ltd., finding of the Ld.CIT(A). Ld. AR also relied on the decision of the Coordinate Bench in the case of DCIT v. M/s. Shree Ratna mangal Jewels Pvt. Ltd., in ITA.No. 566/Mum/2021 (group case), in which the Coordinate Bench has decided the similar issue in favour of the assessee. 14. Considered the rival submissions and material placed on record, we observe from the facts on the record that assessee has taken unsecured loans from M/s. Josh Trading Co. Pvt. Ltd., and M/s. Olive Overseas P. Ltd., (Realgold Trading Co. P. Ltd.,), the Assessing Officer proceeded to make the addition based on the fact that these concerns were controlled and operated by PKJ. It is also important to note that PKJ has retracted the statement and also assessee has taken the loan through banking channels and paid the interest periodically and also repaid the loan in due course. In the similar facts the Coordinate Bench in the case of DCIT v. M/s. Shree Ratna Mangal Jewels Pvt. Ltd., (supra) decided the issue in favour of the assessee, for the sake of brevity the same is reproduced below: - “11. Considered the rival submissions and material placed on record, we observed that the search and seizure operation u/s. 132(1) was conducted in Mangal Group of cases on 01.10.2013 it is relevant to note that Mangal group is owned by Shri Mangal jain and Shri Ajit Jain and family members and they hold major shares and directorship in companies of Mangal group. Assessee is also part of Mangal group which is owned by Shri Mangal Jain and others. In the case of Mangal group, Assessing Officer observed that assessee 14 ITA.NO. 6684/MUM/2019 (A.Y: 2012-13) M/s. Alag Nirman Pvt. Ltd., made additions related to transactions with PKJ group by way unsecured loans/ share application money/bogus purchases. We observed that in the instant case also assessee made similar additions which is relating to unsecured loans and it is pertinent to note that the above said unsecured loans were repaid during the assessment year or in subsequent Assessment Years. We observe from the record that in the case of DCIT v. Smt Meghraj Sohanlal Jain (supra) who is one of the director of the Mangal Group companies, in her case, the Coordinate Bench has decided the issue as below: “The appellant furnished the copies of the account confirmation of the lender companies, acknowledgement of income tax return of lender companies, and their audited financial statement, bank account of lender companies and affidavit of the lender companies confirming the loan transactions. The companies had also filed the return of income in the relevant assessment year. There were no where found immediate deposit of cash before issuance of cheques. The loan was given by account payee cheques through normal banking channels. The interest was also paid and TDS was also deducted thereon. The identity, credit-worthiness and genuineness of the transaction were not seems in genuine. The evidence is required to be rebutted by the AO on basis of some cogent and convincing reason on record. The AO did not conducted any further enquiry. The addition raised by AO u/ 68 of the Act was on the basis of the statement of Shri Praveen Kumar Jain. No material of any kind was found and recovered from the Shri Praveen Kumar Jain which was if any related to the assesse. The evidence is also not on record to the fact that the assesse introduced his own money. Moreover, it also came into notice that Shri Praveen Kumar Jain was also director of one company M/s Mangal jewels Pvt Ltd who also mortgaged his own residential flat against the bank loan availed by M/s Mangal Jewels Pvt Ltd. This fact was also admitted by Shri Praveen Kumar Jain in his statement recorded on 01.10.2013 u/s 132(4) of the Act in the question no. 34 which specify all these contents. The appellant was also guarantor of the company in which shri Praveen kumar jain was the director namely M/s Nakshtra Business Pvt Ltd which showned that both were in business relationship. Moreover, we found that the identical issue has been decided by the Honble ITAT in which the sole statement of Shri Praveen Kumar Jain was not found justifiable to raise the addition u/s 68 of the Act. These are the following - cases 15 ITA.NO. 6684/MUM/2019 (A.Y: 2012-13) M/s. Alag Nirman Pvt. Ltd., 1. ITA No. 5589/M/2017 in case of ACIT Vs M.s Shreedham Builders 2. ITA No. 5954/M/2016 in case of M/s Shree Laxmi Estate Pvt Ltd. VS. ITO 3. ITA. No. 1477/M/2017 in case of ACIT Vs. M/s. Shree Ganesh Developers 4. ITA No. 3091 to 3096/M/2017 in case of ACIT Vs. Shri Ramesh Ramswarupdas Jindal. 5. ITA No. 930/M/2017 in case of ACIT Vs. M/s. H.K. Pujara Builders 6. ITA. No. 6006/M/2016 in case of ITO 12(2)(3) Vs. M.s GGF Industries Pvt Ltd 7. ITA No. 930/M/2017 In case of DCIT Vs Bairagra Builders. Taking into account all the facts and circumstances of the case, we are of the view that the CIT(A) has decided the matter of controversy judiciously and correctly which is not liable to be interference with at this appellate stage. Accordingly, both the issues are decided in favour of the assesse against the revenue.” 12. Since the facts in the present appeal is exactly similar to the facts in the above case, respectfully following the said decision, we dismiss the grounds raised by the revenue. The case law relied by Ld.DR is distinguishable with the facts on record.” 15. Respectfully following the above said decision, we are inclined to agree with the findings of the Ld.CIT(A), accordingly, ground raised by the revenue are dismissed. 16. With regard to Ground No. 4 and 5 of grounds of appeal, we observe that Assessing Officer based on the information received from AIR he proceeded to verify the information and assessee has duly submitted all 16 ITA.NO. 6684/MUM/2019 (A.Y: 2012-13) M/s. Alag Nirman Pvt. Ltd., the informations relating to investment in land. However, Assessing Officer not happy with the information submitted by the assessee and proceeded to make the addition based on the amount as per Stamp Duty Ready Reckoner Value and not considered the agreement value. As per the information available on record we observe that assessee has purchased two land properties bearing Survey No.48/4A, and land bearing Survey No. 36/2, 51/3B, 51/3D in the previous assessment year i.e. A.Y.2011-12. Whereas the AIR information contain the date as 06.04.2011, however, these agreements were dated 30.12.2010. The assessee has purchased the land bearing Survey No. 51/4 during this assessment year i.e. A.Y. 2012-13 which was duly registered during this assessment year. The relevant details are submitted by the assessee as under: - s. No. AY Land Date as per AIR Date as per agreement Stamp duty ready reckoner value Total For the year Agreemen t value Total for the year 1 2011-12 Land bearing survey no.48/ 4A 06.04.2011 30.12.2010 67,80,000 63,00,000 2 Land bearing survey no. 36/2, 51/3B, 51/3D 06.04.2011 30.12.2010 3,15,96,000 3,83,76,000 3,06,00,000 3,69,00,000 3 2012-13 Land bearing no. 51/4 23.09.2011 23.09.2011 2,92,99,000 2,92,99,000 2,51,99,460 2,51,99,460 6,76,75,000 6,20,99,460 17 ITA.NO. 6684/MUM/2019 (A.Y: 2012-13) M/s. Alag Nirman Pvt. Ltd., 17. Based on the above said information we observe that assessee has purchased and recorded the two lands in A.Y. 2011-12 not relating to current assessment year. However, assessee has registered only one land during this assessment year and duly recorded the same in its Books of Accounts. The Ld.CIT(A) has duly considered the above reconciliation of the information contained in AIR and has given a detailed finding in his order. Therefore, we do not find any reason to interfere with the finding of the Ld.CIT(A). 18. However, we observe that Revenue is aggrieved with the fact that Ld.CIT(A) has not called for examination of the source of the investment and without affording the department an opportunity to examine the source of investment. 19. We observe that Ld.CIT(A) has clearly brought on record that two purchases were recorded in the Books of Accounts and balance purchase of land was recorded in the current assessment year and these values were properly recorded in the Books of Accounts and the relevant sources were also recorded in the financial statement submitted by the assessee. Without there being properly recording the investment and sources in the financial statements the assessee would not have recorded the above said 18 ITA.NO. 6684/MUM/2019 (A.Y: 2012-13) M/s. Alag Nirman Pvt. Ltd., purchases in its balance sheet. Therefore, we do not find any reason to interfere with the finding of the Ld.CIT(A) and accordingly, the issue of source of investment is already recorded and explained by the assessee during the assessment proceedings itself. The Assessing Officer had not taken cognizance of the information submitted before him. Therefore, we are inclined to dismiss the ground raised by the Revenue. 20. In the result, appeal filed by the revenue is dismissed. Order pronounced in the open court on 21 st June, 2022 Sd/- Sd/- (VIKAS AWASTHY) (S. RIFAUR RAHMAN) JUDICIAL MEMBER ACCOUNTANT MEMBER Mumbai / Dated 21/06/2022 Giridhar, Sr.PS Copy of the Order forwarded to: 1. The Appellant 2. The Respondent. 3. The CIT(A), Mumbai. 4. CIT 5. DR, ITAT, Mumbai 6. Guard file. //True Copy// BY ORDER (Asstt. Registrar) ITAT, Mum