Income Tax officer-4 (3) Lucknow, Lucknow V. Shri Rais Iqbal, Lucknow

ITA 675/LKW/2011

• Counselvise Citation: 67523714 RSA 2011
• Duration Of Justice: 2 year(s) 10 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-09-2014
• Appeal Filed By: Department
• Order Result: Partly Allowed
• Bench Allotted: A
• Next Hearing Date: 22-07-2014
• Assessment Year: misc
• Appeal Filed On: 14-11-2011
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: ALOK MITRA
• Keywords: Unexplained investment; Opportunity of being heard; Source of fund; Additional evidence

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH A , LUCKNOW BEFORE SHRI S UNIL KUMAR YADAV , JUDICIAL MEMBER AND SHRI. A. K. GARODIA , ACCOUNTANT MEMBER ITA NO. 675/LKW/2011 ASSESSMENT YEAR: 2008 - 09 INCOME TAX OFFICER 4(3) LUCKNOW V. SHRI. RAIS IQ BAL 1/3, SECTOR B, PRIYADARSHINI COLONY SITAPUR ROAD, LUCKNOW PAN: AAEPI6741G (APP ELL ANT) (RESPONDENT) APP ELL ANT BY: SHRI. ALOK MITRA, D.R. RESPONDENT BY: SHRI. RAKESH GARG, ADVOCATE DATE OF HEARING: 22 07 2014 DATE OF PRONOUNCEMENT: 16 0 9 2014 O R D E R PER SUNIL KUMAR YADAV: THIS APPEAL IS PREFERRED BY THE ASSESSEE AGAINST THE ORDER OF THE LD. CIT(A), INTER ALIA, ON VARIOUS GROUNDS WHICH ARE AS UNDER: - 1 . THE CIT (A) HAS ERRED IN LAW AND ON FACTS IN DELETING THE ENTIRE ADDITION MADE BY THE A.O . ON ACCOUNTS OF UNEXPLAINED INVESTMENTS IN VARIOUS MUTUAL FUNDS AS WELL AS CASH DEPOSITED IN BANK ACCOUNTS. 2 . THE CIT (A) HAS ERRED IN LAW AND ON FACTS IN ACCEPTING THAT INVESTMENTS TO THE EXTENT OF THE RS. 1,00,000/ - STOOD EXPLAINED BY AGRICULTURAL INCOME A LTHOUGH NO SUCH INCOME WAS DECLARED BY THE ASSESSEE IN HIS RETURN OF INCOME. 3 . THE CIT (A) HAS ERRED IN LAW AND ON FACTS IN ACCEPTING THAT INVESTMENTS TO THE EXTENT OF RS. 3,00,000/ - STOOD EXPLAINED BY WITHDRAWAL FROM GPF EVEN THOUGH THIS SUM WAS WITHDRAWN BY PRINT TO PDF WITHOUT THIS MESSAGE BY PURCHASING NOVAPDF ( HTTP://WWW.NOVAPDF.COM/ ) : - 2 - : THE ASSESSEE FOR INVESTMENT IN HOUSE PROPERTY. 4 . THE CIT (A) HAS ERRED IN LAW AND ON FACTS OF THE CASE IN ALLOWING CLAIM OF THE ASSESSEE THAT INVESTMENTS OF RS. 8,80,000/ - WERE MADE OUT OF ADVANCE RECEIVED FROM MEHBOOB ALAM AGAINST SALE OF PROPERTY. THIS ALL EGED TRANSACTION IS NOT GENUINE AS THE ASSESSEE WAS NOT OWNER OF THE PROPERTY IN QUESTION. THE ASSESSEE ALSO FAILED TO PROVIDE SHRI ALAM'S ADDRESS. THEREFORE, THE INDENTITY AND CAPACITY COULD NOT BE VERIFIED. 5 . THE CIT (A) HAS ERRED IN LAW AND ON FACTS OF TH E CASE ON TREATING INVESTMENTS OF RS. 2.50 LAKHS AS BEING EXPLAINED AS HAVING BEEN MADE PUT OF CASH LOAN TAKEN FROM MOHD. NASEEM MANSOORI. THIS PERSON RESIDES IN ABU DHABI AND THERE IS NO EVIDENCE AVAILABLE WITH THE ASSESSEE THAT HE HAD THESE FUNDS AVAILABL E WITH HIM IN INDIA FOR MAKING THIS LOAN. THEREFORE THE GENUINENESS OF THE TRANSACTION IS NOT PROVED AND THE ADDITION MADE BY THE AO DESERVES TO BE RESTORED. 6 . THE CIT(A) HAS ERRED IN LAW AND ON FACTS IN AC CEPTING THAT INVESTMENTS OF RS. 21,43,986/ - WAS MADE BY REDEMPTION OF INVESTMENT IN EARLIER YEARS, EVEN THOUGH THE ASSESSEE HAD FAILED TO PROVIDE ANY EVIDENCE FOR THE SAME BEFORE THE A.O. 7 . THE CIT(A) HAS ERRED IN LAW AND ON FACTS IN ACCEPTING THE CLAIM OF THE ASSESSEE THAT HIS INVESTMENT IN TATA ASSE TS MANAGE MENT LTD, WAS ONLY RS.10,00,000/ - AND NOT RS. 27,67,236/ - WHICH IS ON RECORD, THE DIFFERENCE BEING ON ACCOUNT OF SWITCHING BETWEEN VARIOUS SCHEMES. HE IGNORED THE FACT THAT THE ASSESSEE HAD FAILED TO PROVIDE ANY EVIDENCE IN SUPPORT OF HIS CLAIM BEFORE THE A .O. 2 . THOUGH VARIOUS GROUNDS ARE RAISED, BUT THEY ALL ARE INTERRELATED AND THE MAIN ISSUE INVOLVED IN THIS APPEAL IS WITH REGARD TO THE ADDITION PRINT TO PDF WITHOUT THIS MESSAGE BY PURCHASING NOVAPDF ( HTTP://WWW.NOVAPDF.COM/ ) : - 3 - : MADE ON ACCOUNT O F UNEXPLAINED INVESTMENT OF RS.51,81,514 / - UNDER VARIOUS HEADS . 3 . ASSESSEE HAD FILED WRITTEN SU BMISSIONS BEFORE THE LD. CIT(A) EXPLAINING THE DETAILS OF INVESTMENT MADE DURING THE YEAR IN HIS NAME; IN THE NAME OF HIS WIFE AND IN THE NAME OF HIS DAUGHTER . IT WAS ALSO STATED BEFORE THE LD. CIT(A) THAT THOUGH THE ASSESSING OFFICER NOTED THE TOTAL INVE STMENT OF RS.61,09,693/ - , BUT IN FACT ASSESSEE HAS MADE INVESTMENT OF RS.43,40,457/ - AND NOT RS.61,09,693/ - , OUT OF WHICH SOURCE OF INVESTMENT OF RS.9,28,179/ - WAS ALREADY ACCEPTED BY THE ASSESSING OFFICER. THEREFORE, THE ADDITION OF RS.51,81,514/ - MADE B Y THE ASSESSING OFFICER IS NOT SUSTAINABLE. BEFORE THE LD. CIT(A), ASSESSEE HAS ALSO CONTENDED THAT THE MAIN DISPUTE WAS RAISED WITH REGARD TO THE DIFFERENCE IN INVESTMENT IN TATA ASSETS MANAGEMENT AT RS.27,65,237/ - ACCORDING TO THE ASSESSING OFFICER; WHE REAS ACCORDING TO THE ASSESSEE IT WAS ONLY RS.10 LAKHS. 4 . THE OTHER DIFFERENCE IN DETAILS OF INVESTMENT WAS WITH REGARD TO HDFC MUTUAL FUND, IN WHICH ACCORDING TO THE ASSESSING OFFICER , INVESTMENT WAS MADE AT RS.2,88,757/ - ; WHEREAS ACCORDING TO THE ASSESSE E IT WAS AT RS.2,86,757/ - . THE LD. CIT(A) PREPARED A CHART OF INVESTMENT ACCORDING TO THE ASSESSING OFFICER AND DECLARED BY THE ASSESSEE. THE DIFFERENCE IN INVESTMENT IN HDFC MUTUAL FUND WAS EVIDEN T FROM THE CHART, AS ACCORDING TO THE ASSESSING OFFICER I NVESTMENT MADE BY THE ASSESSEE WAS RS.2,8 8 ,757/ - AND THERE WAS NO INVESTMENT IN THE NAME OF HIS WIFE OR DAUGHTER AND THEREFORE THE TOTAL INVESTMENT IN HDFC MUTUAL FUND SHOULD BE RS.2,86,757/ - , BUT THE ASSESSING OFFICER WRONGLY ADOPTED THE SAME AT RS. 2,88,7 57/ - . THE DIFFERENCE WAS NOTED BY THE LD. CIT(A) AND CORRESPONDING DELETION WAS MADE WITH WHICH NO DISPUTE WAS RAISED BY THE REVENUE. 5 . THE OTHER DISPUTE WAS RAISED WITH REGARD TO THE DIFFERENCE IN INVESTMENT WITH TATA ASSETS MANAGEMENT. ACCORDING TO THE AS SESSING PRINT TO PDF WITHOUT THIS MESSAGE BY PURCHASING NOVAPDF ( HTTP://WWW.NOVAPDF.COM/ ) : - 4 - : OFFICER, IT WAS OF RS.27,67,236/ - , WHEREAS THE ASSESSEE HAS ACCEPTED THE INVESTMENT OF RS.10 LAKHS. THE DIFFERENCE WAS EXPLAINED BY THE ASSESSEE THAT IT WAS CAUSED BY SWITCH ING OVER FROM ONE INVESTMENT TO OTHER I.E. SAME INVESTMENT BEING ROTATED O VER A PERIOD OF TIME FROM ONE SCHEME OF THE FUND TO THE OTHER. WHILE THE ASSESSING OFFICER HAS TAKEN THE INVESTMENT AS THE CUMULATIVE FIGURE, BUT THE ASSESSEE HAS TAKEN THE FIGURE OF INVESTMENTS ACTUALLY MADE , AS THE SWITCHES ARE INCLUDED IN THE INVESTMEN TS ORIGINALLY MADE. THE ASSESSING OFFICER NOTED THE DETAILS OF INVESTMENTS IN 26 SCHEMES FROM THE TATA ASSETS MANAGEMENT, BUT WITHOUT EXAMINING THE CLAIM OF SWITCH OVER FROM ONE SCHEME TO OTHER, THE ASSESSING OFFICER HAS WORKED OUT THE TOTAL INVESTMENT OF RS.27,65,237/ - . ACCORDING TO THE ASSESSEE, THE DETAILS WERE FILED BEFORE THE ASSESSING OFFICER, BUT HE HAS NOT LOOKED INTO IT AND TAKEN THE CUMULATIVE FIGURE OF INVESTMENT IN TATA ASSETS MANAGEMENT. THE LD. CIT(A) TOOK COGNIZANCE OF THESE SWITCH OVER OF INVESTMENTS AND HAVING VERIFIED FROM THE DETAILS , HE ACCEPTED THE CONTENTION OF THE ASSESSEE THAT THE TOTAL INVESTMENT WAS OF RS.4 3 ,40,457/ - AS AGAINST RS.61,09,693/ - TAKEN BY THE ASSESSING OFFICER. ACCORDINGLY, THE LD. CIT(A) DELETED THE ADDITION. FOR THE SAKE OF REFERENCE, WE EXTRACT THE RELEVANT PORTION OF THE ORDER OF THE LD. CIT(A) AS UNDER: - 7(1)(I) I HAVE EXAMINED THE FACTS AND CIRCUMSTANCES OF THE CASE. I HAVE PERUSED THE FINDINGS OF THE ASSESSING OFFICER IN THE ASSESSMENT ORDER AND I HAVE ALSO CONSIDERED THE SUBMISSIONS OF THE APPELLANT. IT IS IMPERATIVE FIRST TO EXAMINE THE DIFFERENCE IN INVESTMENTS FOUND BY THE AO AND THE INVESTMENTS ACCEPTED BY THE ASSESSEE. THE COMPARATIVE POSITION IS AS UNDER - S.NO INVESTMENTS AS PER AO ACTUAL INVESTMENT AS PER ASSESSEE APPELLANT WIFE DAUGHTER TOTAL APPELLANT AND DAUGHTER MRS. NAZIA IQBAL WIFE DAUGHTER MRS. HINA IQBAL TOTAL TATA PRINT TO PDF WITHOUT THIS MESSAGE BY PURCHASING NOVAPDF ( HTTP://WWW.NOVAPDF.COM/ ) : - 5 - : ASSETS 1. 26,70,069 47,167 50,000 27,67,236 7,50,000 2,50,000 NIL 10,00,000 MANAGEMENT LTD. HSBC 2. MANAGEMENT 9,17,000 2,60,000 1 ,40,000 13,17,000 9,17,000 2,60,000 1 ,40,000 13,17,000 3 HDFC MUTUAL FUND 2,86,757 NIL NIL 2,88,757 2,86, 757 NIL NIL 2,86,757 4 IVL 9,47,000, NIL NIL 9,47,000 9,47,000 NIL NIL 9,47,000 5. RELIANCE 2,99,700 NIL . NIL 2,99,700 2,99,700 NIL NIL 2,89,700 6. SBN PPEO 60,000 NIL NIL 60,000 60,000 NIL NIL 60,000 7. FRANKELIN INDIA PRIMA 30,000 NIL NIL 30,000 30,000 NIL NIL 30,000 8. ABN AMRO CHINA INDIA FUND 3,00,000 NIL NIL 3,00,000 3,00,000 NIL NIL 3,00,000 9. KTL 1,00,000 NIL NIL 1,00,00 1,00,000 NIL NIL 1,00,000 TOTAL 56,10,526 3,07,167 1,90,000 61,09,693 36,90,457 3,10,000 1,40,000 43,40,457 7(1)(II) IT IS EVIDENT THAT THERE ARE TWO DIFFERENCES IN THE VALUE OF INVESTMENTS EXAMINED BY THE AO FOR WHICH ADDITIONS HAVE BEEN MADE AND THE INVESTMENTS ACCEPTED BY THE APPELLANT AS PER DETAILS ABOVE. THE FIRST DIFFERENCE IS WITH REGARD TO HDFC MUTUAL FUND. THE AO HAS MADE THE ADDITION FOR AN AMOUNT OF RS.2,88,757/ - WHEREAS THE ASSESSEE ACCEPTS AN INVESTMENT OF RS.2,86,757/ - . THE DIFFERENCE APPEARS TO BE A TYPOGRAPHICAL ERROR IN SO FAR AS THE AO HAS MENTIONED THE FIGURE OF RS.2,86,757/ - IN THE BODY OF ORDER AT PAGE 4 OF THE ASSESSMENT ORDER WHICH IS SAME AS THAT ACCEPTED BY THE ASSESSEE BUT WHILE MAKING THE ADDITION THE FIGURE INADVERTENTLY HAS BEEN TAKEN AS RS.2,88,757/ - . THE INVES TMENT IN HDFC MUTUAL FUND IS THEREFORE ACCEPTED AS RS.2,86,757 / - . 7(1)(III) THE ONLY OTHER DIFFERENCE IN WITH REGARD TO INVESTMENTS MADE WITH TATA ASSETS MANAGEMENT. THE AO HAS FOUND INVESTMENTS OF RS.27,67,236/ - WHEREAS THE ASSESSEE HAS ACCEPTED THE INVE STMENTS OF RS.10,00,000/ - . IT IS THEREFORE IMPERATIVE TO EXAMINE THIS DIFFERENCE. THE ASSESSEE HAS SUBMITTED THAT THE DIFFERENCE HAS BEEN CAUSED BY SWITCHES I.E. THE SAME INVESTMENT BEING ROTATED OVER A PERIOD OF TIME FROM ONE SCHEME OF THE FUND TO THE OTH ER. WHILE THE AO HAS TAKEN THE INVESTMENT AS THE CUMULATIVE FIGURE, THE ASSESSEE HAS TAKEN THE FIGURE OF INVESTMENTS ACTUALLY MADE AS THE SWITCHES PRINT TO PDF WITHOUT THIS MESSAGE BY PURCHASING NOVAPDF ( HTTP://WWW.NOVAPDF.COM/ ) : - 6 - : ARE INCLUDED IN INVESTMENTS ORIGINALLY MADE. THE AO ACQUIRED THE DETAILS OF INVESTMENTS IN 26 SCHEMES FROM TH E TATA ASSETS MANAGEMENT. THE TOTAL INVESTMENT WORKED OUT TO RS.27,65,237/ - WITHOUT CONSIDERING THE SWITCHES FROM ONE SCHEME TO THE OTHER. THE INVESTMENT MADE BEFORE AND AFTER THE SWITCH FROM ONE SCHEME TO ANOTHER INCLUDED IN THESE 26 SCHEMES. THE FIGURE HAS BEEN TAKERS BY THE AO AT RS.27,67,236/ - RESULTING IN A TOTALING ERROR OF RS. 1,998/ - . 7(2)(I) THE INVESTMENT IN TATA ASSETS MANAGEMENT WITHOUT CONSIDERING THE SWITCHES IS AS PER SERIAL NUMBERS 10 TO 16, 19, 20 AND 22 IN THE NAME OF THE ASSESSEE, SERIAL NUMBER 18 IN THE NAME OF DAUGHTER NAZIA IQBAL AND SERIAL NUMBER 26 AND 17 IN THE NAME OF WIFE SMT. SHENAZ IQBAL. THESE DETAILS WERE PREPARED BY THE ASSESSEE FROM THE STATEMENT OF MUTUAL FUNDS. THE DETAILS ARE AS UNDER - S. NO. INVESTMENT FOLIO NO. SCHEME NAME 10 50,000 1716213 TATA INDO GLOBAL INFRASTRUCTURE FUND - 11 50,000 1716213 TATA INDO GLOBAL INFRASTRUCTURE FUND - 12 50,000 1716213 TATA INDO GLOBAL INFRASTRUCTURE FUND - GROWTH 13 50,000 1716213 TATA INDO GLOBAL INFRAS TRUCTURE FUND - 14 50,000 1716213 TATA TNDO GLOBAL INFRASTRUCTURE FUND - 15 50,000 1716213 TATA INDO GLOBAL INFRASTRUCTURE FUND - GROWTH 16 1,00,000 1969584 TATA INDO GLOBAL INFRASTRUCTURE FUND - 19 50,000 2023064 TATA INDO GLOBAL INFRASTRUCTURE FUND - GROWTH 20 2,00,000 2023622 TATA INDO GLOBAL INFRASTRUCTURE FUND - 22 50,000 2023622 TATA INDO GLOBAL INFRASTRUCTURE FUND - TOTAL RS. 7,00,000 18 47,167.20 2023061 TATA INDO GLOBAL INFRASTRUCTUR E FUND - TOTAL RS. 47,167.2 26 1,00,000 1969584 TATA EQUITY PE FUND 17 37,983 1969584 TATA INDO GLOBAL INFRASTRUCTURE FUND - TOTAL RS. 1,37,983 PRINT TO PDF WITHOUT THIS MESSAGE BY PURCHASING NOVAPDF ( HTTP://WWW.NOVAPDF.COM/ ) : - 7 - : CUMULATIVE TOTAL RS. 8,85,150.2 7(2)(II) THE REMAINING INVESTMENTS IN TATA MUTU AL FUND CONSIDERED AS UNEXPLAINED BY THE AO ARE IN FACT SWITCHES FROM ONE SCHEME TO ANOTHER. THE DETAILS COMPILED FROM THE DETAILS OF INVESTMENTS IN 26 SCHEMES ARE AS UNDER - S. NO. INVESTMENT FOLIO NO. REMARKS AS EXPLAINED BY APPELLANT 1 47,167.2 1 483191 SWITCH OUT 2 36,598.56 1483191 IT IS SWITCH OUT ON 14/3/2008. SWITCH IN WAS FROM TATA SIP FUND SCHEME 1 - GROWTH AT SI. NO. 1, RS. 47,167.20/ - ON 7/11/2007. 3 47,167.2 1496319 IT IS SWITCH IN FROM TATA SIP FUND SCHEME I GROWTH, AMOUNT IS R S.2,62,040/ - 4 S 2,05,003.27 1496319 IT IS SWITCH OUT FROM TATA SIP FUND SCHEME 1 - GROWTH , AMOUNT IS RS. 2,62,040/ - . 5 2,62,040 1496321 IT IS SWITCH IN FROM TATA SIP FUND SCHEME 1 - GROWTH 6 2,62,040 1496321 IT IS SWITCH OUT TO TATA EQUITY OPP ORTUNITIES FUND APPLICATION 7 1,98,824 1969584 IT IS SWITCH IN FROM TATA SIP FUND SCHEME 1 - GROWTH AND AMOUNT IS RS.47,167.20/ - 8 2,62,040 1969584 IT IS SWITCH OUT FROM TATA SIP FUND SCHEME 1 - GROWTH , AMOUNT IS RS. 47,167/ - . 9 2,62,040 171621 3 IT IS A SWITCH IN FOLIO NUMBER 1496319 TATA PURE EQUITY PE FUND GROWTH FROM TAAT SIP 21 47,167.2 2023622 IT IS SWITCH IN FROM FOLIO NO. 1483191/11 TATA SIP FUND 1 GROWTH TO TATA SELECT EQUITY FUND 23 50,000 1483191 SWITCH OUT TO TATA AIG AMOUN T IS RS. 36,598 24 1,00,000 1496319 SWITCH OUT TO T ATA AIG AMOUNT IS RS. 2,05,003.27 25 1,00,000 1496321 IT IS SWITCH OUT TO TGEIAG AND AMOUNT IS RS. 1,98,824.08 TOTAL RS. 18,80,087.43 7(2)(III) THE TOTAL OF INVESTMENTS AS PER LIST OF 26 SCHEMES OBTAINED BY THE AO FROM THE TATA ASSETS MANAGEMENT IS RS. 27,65,237.86. THE TOTAL OF INVESTMENTS WITHOUT CONSIDERING THE SWITCHES AS TABULATED IN FIRST TABLE IS RS.8,85,150.2. THE TOTAL INVESTMENTS PRINT TO PDF WITHOUT THIS MESSAGE BY PURCHASING NOVAPDF ( HTTP://WWW.NOVAPDF.COM/ ) : - 8 - : COMPRISED IN THE SWITCHES I.E. SWITCH FROM ONE SCHEME TO ANOTHER ALSO INCLUDED IN THE LIST OBTAINED BY THE AO AS TABULATED IN SECOND TABLE IS RS.18,80,087.43. THE TWO TABLES ABOVE TOTAL AT RS.27,65,237.63. IN OTHER WORDS THE DIFFERENCE WORKED OUT BY THE AO IS EXPLAINED BY THE SWITCHES FROM ONE SCHEME TO ANOTHER. HOWEVER, THE APPELLANT HAS WORKED OUT HIS INVESTMENT IN TATA ASSETS MANAGEMENT SCHEMES AT RS.10,00,000/ - FROM THE STATEMENTS OF MUTUAL FUNDS WHICH WERE ALSO FILED WITH THE AO. 7(2)(IV) ON THE BASIS OF ABOVE EXAMINATION, IT IS EVIDENT TH AT THE TOTAL INVESTMENT BY THE APPELLANT DURING THE YEAR UNDER CONSIDERATION IS TO BE TAKEN AT RS.43,40,457/ - AS AGAINST RS.61,09,693/ - TAKEN BY THE AO. THE DIFFERENCE OF RS.17,69,236/ - HAS BEEN EXPLAINED AS ABOVE ON ACCOUNT OF FIRSTLY, THE TYPOGRAPHICAL E RROR OF RS. 2,2,000/ - IN THE INVESTMENTS IN HDFC MUTUAL FUND AND SECONDLY, THE DIFFERENCE OF RS.17,67,236/ - ON ACCOUNT OF SWITCHES FROM ONE SCHEME TO ANOTHER IN SCHEMES OF TATA ASSETS MANAGEMENT. 6 . AGGRIEVED, THE REVENUE HAS PREFERRED AN APPEAL BEFORE THE TRIBUNAL WITH THE SUBMISSION THAT THE DETAILS FURNISHED BY THE ASSESSEE WITH REGARD TO THE SWITCH OVER OF INVESTMENT IN TATA ASSETS MANAGEMENT FROM ONE SCHEME TO THE OTHER WERE NOT EXPLAINED BEFORE THE ASSESSING OFFICER AND HE HAS TAKEN A NEW PLEA BEFORE T HE LD. CIT(A) AND THE LD. CIT(A) WITHOUT CONFRONTING IT TO THE ASSESSING OFFICER HAS ACCEPTED THE CLAIM OF THE ASSESSEE. 7 . THE LD. COUNSEL FOR THE ASSESSEE, ON THE OTHER HAND, HAS SUBMITTED THAT THE DETAILS OF SWITCH OVER OF INVESTMENT WERE FURNISHED BEFORE THE ASSESSING OFFICER, BUT HE DID NOT TAKE COGNIZANCE OF THE SAME AND HE WORKED OUT THE CUMULATIVE FIGURE OF INVESTMENT WITHOUT LOOKING TO THE FACTS OF SWITCH OVER FROM ONE SCHEME TO THE OTHER. THE LD. COUNSEL FOR THE ASSESSEE HAS PLACED THE DETAILS OF IN VESTMENT IN TATA ASSETS PRINT TO PDF WITHOUT THIS MESSAGE BY PURCHASING NOVAPDF ( HTTP://WWW.NOVAPDF.COM/ ) : - 9 - : MANAGEMENT WITH REGARD TO SWITCH OVER FROM ONE SCHEME TO OTHER AT PAGES 22 TO 42 OF THE COMPILATION OF THE ASSESSEE. 8 . HAVING GIVEN A THOUGHTFUL CONSIDERAT ION TO THE EVIDENCE PLACED BEFORE US AND THE ORDERS OF THE LOWER AUTHORITIES, W E FIND THAT ACCORDING TO THE ASSESSEE HE HA D PLACED ALL DETAILS BEFORE THE ASSESSING OFFICER WITH REGARD TO THE INVESTMENT IN TATA ASSETS MANAGEMENT FROM ONE SCHEME TO THE OTHER, BUT IT WAS NOT TAKEN INTO ACCOUNT BY THE ASSESSING OFFICER. THOUGH THE REVEN UE HAS TAKEN AN ARGUMENT THAT BEFORE THE LD. CIT(A) ASSESSEE HAS RAISED A NEW ARGUMENT, BUT NO SPECIFIC GROUND OF APPEAL HAS BEEN RAISED IN THIS REGARD. HAD IT BEEN THE CASE OF ADMISSION OF ADDITIONAL EVIDENCE BY THE LD. CIT(A) WITHOUT CONFRONTING TO THE ASSESSING OFFICER, THE REVENUE SHOULD HAVE TAKEN A GROUND WITH REGARD TO THE VIOLATION OF RULE 46A OF THE INCOME TAX RULES. MOREOVER, FROM THE DETAILS FURNISHED BEFORE US, THE ASSESSEE HAS GIVEN A CERTIFICATE THAT THESE EVIDENCES WERE FILED BEFORE THE ASS ESSING OFFICER AND THE CERTIFICATE WAS NOT DISPUTED BY THE LD. D.R. IN THE LIGHT OF THESE FACTS, WE ARE OF THE VIEW THAT THE DETAILS WERE AVAILABLE BEFORE THE ASSESSING OFFICER AND BEFORE MAKING ADDITION IN THIS REGARD, THE MATERIAL SHOULD HAVE BEEN EXAMI NED BY HIM; WHEREAS THE LD. CIT(A) HAS CAREFULLY EXAMINED THE DETAILS OF INVESTMENT FROM ONE SCHEME TO THE OTHER AND FINALLY CONCLUDED THAT ACTUAL INVESTMENT IN TATA ASSETS MANAGEMENT WAS RS.10 LAKHS AND NOT RS. 27,67,236/ - AS ADOPTED BY THE ASSESSING OFFIC ER. THEREFORE, WE FIND NO INFIRMITY IN THIS REGARD AND WE ACCORDINGLY CONFIRM THE ORDER OF THE LD. CIT(A). 9 . THE NEXT ISSUE RELATES TO THE SOURCE OF INVESTMENT IN THE AFORESAID INVESTMENTS MADE BY THE ASSESSEE. 10 . THE ASSESSING OFFICER HAS ALREADY ALLOWED BENE FIT OF RS.9,28,179/ - AS KNOWN SOURCE OF INVESTMENT. THE LD. CIT(A) REQUIRED THE ASSESSEE TO EXPLAIN THE TOTAL SOURCE OF INVESTMENT OF RS.43,40,457/ - FOR WHICH ASSESSEE HA D FURNISHED THE DETAILS BEFORE THE LD. CIT(A). AS PER DETAILS, ASSESSEE PRINT TO PDF WITHOUT THIS MESSAGE BY PURCHASING NOVAPDF ( HTTP://WWW.NOVAPDF.COM/ ) : - 10 - : HA D FURNISHE D KNOWN SOURCE OF INCOME AMOUNTING TO RS.50,09,986 TO EXPLAIN THE INVESTMENT OF RS.43,40,457/ - . IN THESE DETAILS, THE DISPUTE AS RAISED BEFORE US IN THE REVENUES APPEAL IS WITH REGARD TO RS.1 LAKH FROM AGRICULTURAL INCOME; WITHDRAWAL OF RS.3 LAKHS FROM G .P.F.; RECEIPT OF RS.8.80 LAKHS AS ADVANCE FROM MR MEHBOOB ALAM AGAINST SALE OF PROPERTY; RECEIPT OF CASH LOAN FROM MOHD. NASEEM MANSOORI OF RS.2.50 LAKHS AND REDEMPTION OF INVESTMENT IN EARLIER YEARS AT RS.21,43,986/ - . WE, THEREFORE, PREFER TO DEAL EACH AND EVERY ENTRY IN THE LIGHT OF THE ORDERS OF THE LD. CIT(A) AS WELL AS THE ASSESSING OFFICER. 11 . WITH REGARD TO RECEIPT OF AGRICULTURAL INCOME, IT WAS CONTENDED THAT THE ASSESSEES FAMILY OWNS AGRICULTURAL LAND OF 57 HECTARES AND THE ASSESSEE HAS EARNED AGRI CULTURAL INCOME OF RS.1 LAKH. THE ASSESSING OFFICER DISPUTED THIS STAND OF THE ASSESSEE ON THE GROUND THAT ASSESSEE HAS NOT DISCLOSED AGRICULTURAL INCOME IN HIS RETURN OF INCOME. BUT THIS CONTENTION OF THE ASSESSEE WAS ACCEPTED BY THE LD. CIT(A) ON THE GROUND THAT FAILURE TO DISCLOSE THE AGRICULTURAL INCOME IN THE RETURN OF INCOME HAS THE EFFECT OF MAKING IT AN INCOME WHOSE PARTICULARS HAVE BEEN CONCEALED AND IT DOES NOT MEAN THAT THE ASSESSEE WAS NOT HAVING AGRICULTURAL INCOME. 12 . THIS OBSERVATION OF THE LD. CIT(A) WHILE DELETING THE ADDITION CANNOT BE ACCEPTED , AS THE ISSUE IN DISPUTE IS WITH REGARD TO THE SOURCE OF INVESTMENT OF THE ASSESSEE. IF THE ASSESSEE DOES NOT EARN ANY AGRICULTURAL INCOME , AS HE HAS NOT SHOWN IN HIS RETURN OF INCOME, THE BENEFIT OF EARNING OF AGRICULTURAL INCOME BY THE FAMILY CANNOT BE GIVEN TO THE ASSESSEE IN THE ABSENCE OF DOCUMENTARY EVIDENCE. NO REVENUE RECORD WAS PLACED BEFORE THE LD. CIT(A) WITH REGARD TO THE AGRICULTURAL LAND OWNED BY THE ASSESSEE. IN THE ABSENCE OF ANY A GRICULTURAL HOLDINGS IN THE NAME OF THE ASSESSEE, THE BENEFIT OF EARNING OF AGRICULTURAL INCOME CANNOT BE GIVEN TO THE ASSESSEE , M ORE SO IN THE LIGHT OF THE NON - DISCLOSURE OF THE SAME IN THE RETURN OF INCOME. ACCORDINGLY, WE DO NOT AGREE WITH THE FINDINGS OF THE LD. CIT(A) IN PRINT TO PDF WITHOUT THIS MESSAGE BY PURCHASING NOVAPDF ( HTTP://WWW.NOVAPDF.COM/ ) : - 11 - : THIS REGARD AND WE SET ASIDE HIS ORDER AND RESTORE THAT OF THE ASSESSING OFFICER. 13 . WITH REGARD TO THE WITHDRAWAL FROM G.P.F. ACCOUNT AT RS.3 LAKHS, THE ASSESSING OFFICER MADE DISALLOWANCE ON THE GROUND THAT THE WITHDRAWAL OF RS.3 LAKHS FROM THE G.P.F. ACCOUNT WAS MADE FOR CONSTRUCTION OF THE HOUSE, THEREFORE, THIS AMOUNT CANNOT BE INVESTED IN TATA ASSETS MANAGEMENT. 14 . THIS SOURCE OF INVESTMENT WAS ACCEPTED BY THE LD. CIT(A) ON THE GROUND THAT AFTER COMPLETING 20 YEARS OF SERVICE, ASSESS EE WAS ENTITLED TO MAKE WITHDRAWAL FROM HIS G.P.F ACCOUNT AND IT IS IRRELEVANT WHETHER ASSESSEE HAS WITHDRAWN THE SAME FOR CONSTRUCTION OF THE HOUSE OR NOT AND HE HAS ALSO OBSERVED THAT THE HOUSE WAS NOT CONSTRUCTED. THESE OBSERVATIONS OF THE LD. CIT(A) W HILE DELETING THE ADDITION DOES NOT APPEARS TO BE CONVINCING, AS THE WITHDRAWAL FROM THE G.P.F. WAS MADE FOR A PARTICULAR PURPOSE I.E. FOR CONSTRUCTION OF THE HOUSE AND NO EVIDENCE WAS PLACED EITHER BEFORE HIM OR US THAT THE ASSESSEE HAS NOT CONSTRUCTED AN Y HOUSE. BEFORE THE ASSESSING OFFICER, ASSESSEE HAS NOT DISCLOSED WITHDRAWAL FROM G.P.F. AS ONE OF THE SOURCE OF INVESTMENT. THIS STAND WAS TAKEN FOR THE FIRST TIME BEFORE THE LD. CIT(A) AND THE LD. CIT(A), WITHOUT VERIFYING THE FACTS, HAS ACCEPTED THE C LAIM OF THE ASSESSEE. WE, THEREFORE, DO NOT AGREE WITH THE FINDINGS OF THE LD. CIT(A) AND ACCORDINGLY WE SET ASIDE THE ORDER OF THE LD. CIT(A) ON THIS ISSUE AND HOLD THAT WITHDRAWAL OF RS.3 LAKHS FROM G.P.F. ACCOUNT CANNOT BE CONSIDERED TO BE THE VALID SO URCE OF INVESTMENT. 15 . WITH REGARD TO RECEIPT OF RS.8.80 LAKHS FROM MR MEHBOOB ALAM FOR SALE OF PROPERTY, ASSESSEE HAS SIMPLY PLACED SALE DEED/SALE AGREEMENT THROUGH WHICH HE ALLEGED TO HAVE RECEIVED AN ADVANCE OF RS.8.80 LAKHS IN CASH FROM MR. MEHBOOB ALAM. THE ASSESSING OFFICER ASKED THE ASSESSEE TO PRODUCE THE PROOF OF OWNERSHIP OF THE PROPERTY, BUT IT WAS NO T PRODUCED PRINT TO PDF WITHOUT THIS MESSAGE BY PURCHASING NOVAPDF ( HTTP://WWW.NOVAPDF.COM/ ) : - 12 - : BEFORE HIM AND HE ACCORDINGLY DID NOT ACCEPT IT TO BE THE SOURCE OF INVESTMENT. 16 . THE LD. CIT(A) ACCEPTED IT TO BE SOURCE OF INVESTMENT, HA VING OBSERVED THAT ONCE THE APPELLANT HAD CLAIMED RECEIPT OF RS.8.80 LAKHS FROM MR. MEHBOOB ALAM ON ACCOUNT OF INTENDED SALE OF ANCESTRAL PROPERTY, THE ASSESSING OFFICER COULD HAVE EXAMINED THE PERSON MAKING ADVANCE INSTEAD OF REJECTING THE CLAIM SUMMARILY BY STATING THAT PROOF OF OWNERSHIP WAS NOT FURNISHED. THE LD. CIT(A) FURTHER OBSERVED THAT NON - FILING OF PROOF OF OWNERSHIP CANNOT NEGATE RECEIPT OF MONEY FROM A PERSON AND IN CASE THERE WAS NO PROOF OF OWNERSHIP, IT WOULD SIMPLY MEAN THAT THE AMOUNT HAS BEEN RECEIVED FOR SOME OTHER PURPOSE. IT WOULD NOT TANTAMOUNT TO THE MONEY NOT HAVING BEEN RECEIVED. THE LD. CIT(A) ACCORDINGLY HELD THAT ASSESSEE HAS RECEIVED AN AMOUNT OF RS.8.80 LAKHS FROM MR MEHBOOB ALAM. 17 . NOW THE REVENUE IS IN APPEAL BEFORE THE TRIB UNAL WITH THE SUBMISSION THAT SUBSTANTIAL AMOUNT OF RS.8.80 LAKHS FROM MR MEBOOB ALAM IN CASH ON THE PRETEXT THAT ASSESSEE HAS RECEIVED THIS MUCH OF AMOUNT FOR EXECUTING THE AGREEMENT FOR SALE OF HIS PROPERTY. HE HAS INVITED OUR ATTENTION TO THE AGREEMENT APPEARING AT PAGES 86 TO 94 OF THE COMPILATION OF THE ASSESSEE , WITH THE SUBMISSION THAT THE AGREEMENT OF SALE OF AN IMMOVABLE PROPERTY IN UTTAR PRADESH IS REQUIRED TO BE REGISTERED AS PER THE REGISTRATION ACT. MOREOVER , THE AGREEMENT FOR SALE CAN ONLY B E EXECUTED BY THE EXECUTOR OR THE SELLER WITH REGARD TO THAT PROPERTY WHICH IS OWNED BY THE SELLER. WITHOUT VERIFYING THESE FACTS, NO BUYER WILL MAKE PAYMENT FOR PURCHASE OF ANY PROPERTY O NLY ON EXECUTION OF THE SALE AGREEMENT OF PROPERTY , WHICH IS NOT OW NED BY THE SELLER. THEREFORE, THE ASSESSING OFFICER HAS RAISED A VALID QUERY FROM THE ASSESSEE TO PRODUCE THE OWNERSHIP DOCUMENT OF THE PROPERTY WHICH WAS NOT FURNISHED BEFORE HIM AND THE ASSESSING OFFICER HAS RIGHTLY TREATED THIS TRANSACTION TO BE BOGUS A ND DID NOT ACCEPT RECEIPT OF RS.8.80 LAKHS AS ONE OF THE SOURCES OF INVESTMENT. PRINT TO PDF WITHOUT THIS MESSAGE BY PURCHASING NOVAPDF ( HTTP://WWW.NOVAPDF.COM/ ) : - 13 - : 18 . THE LD. COUNSEL FOR THE ASSESSEE, ON THE OTHER HAND, HAS PLACED HEAVY RELIANCE UPON THE ORDER OF THE LD. CIT(A). 19 . HAVING GIVEN A THOUGHTFUL CONSIDERATION TO THE RIVAL SUBMISSION S AND FROM A CAREFUL PERUSAL OF THE ORDERS OF THE AUTHORITIES BELOW AND THE SO CALLED SALE AGREEMENT APPEARING AT PAGES 86 TO 94 OF THE COMPILATION OF THE ASSESSEE, WE FIND THAT THIS DOCUMENT WAS EXECUTED ON A PLAIN PAPER AND IT IS A FAKE DOCUMENT, AS IT I S NOT PROPERLY LEGIBLE. IT IS IMPORTANT TO NOTE HERE THAT IN UTTAR PRADESH , AGREEMENT FOR SALE OF IMMOVABLE PROPERTY IS REQUIRED TO BE REGISTERED UNDER THE INDIAN REGISTRATION ACT, OF WHICH STAMP DUTY IS REQUIRED TO BE PAID. IT IS ALSO AN IMPORTANT FACTO R THAT ONLY THAT PROPERTY CAN BE SOLD WHICH IS OWNED BY THE SELLER. IN THIS CASE, THE ASSESSING OFFICER HAS RAISED A SPECIFIC QUERY FROM THE ASSESSEE TO PRODUCE THE OWNERSHIP DOCUMENT OF THE PROPERTY WHICH IS PROPOSED TO BE SOLD BY THE ASSESSEE, BUT THE A SSESSEE DID NOT PLACE THE OWNERSHIP DOCUMENT BEFORE THE ASSESSING OFFICER. SIMILAR IS THE POSITION BEFORE US AND THE LD. CIT(A). HE SIMPLY PLACED RELIANCE UPON THE SO CALLED SALE AGREEMENT BUT COULD NOT PLACE OWNERSHIP DOCUMENT OF THE PROPERTY. IN THE A BSENCE OF DOCUMENTS FOR OWNERSHIP OF THE PROPERTY, THE FACTUM OF EXECUTION OF SALE AGREEMENT CANNOT BE ACCEPTED. NO PRUDENT MAN WILL PURCHASE ANY PROPERTY FROM ANYONE WHICH IS NOT OWNED BY HIM . MOREOVER, THIS IS THE CASE WHERE THE ASSESSEE HAS RAISED CER TAIN FUNDS FOR INVESTMENT AND ONUS IS UPON HIM TO PROVE THE SAME. IT IS FOR THE ASSESSEE TO PLACE THE RELEVANT EVIDENCE TO ESTABLISH THAT HE IN FACT HAS RECEIVED THE AMOUNT OF RS.8.80 LAKHS FROM THE BUYER ON EXECUTION OF SALE AGREEMENT. BUT ASSESSEE HAS BADLY FAILED TO DISCHARGE HIS ONUS. WE ARE, THEREFORE, OF THE VIEW THAT THE CLAIM OF THE ASSESSEE THAT RECEIPT OF RS.8.80 LAKHS THROUGH EXECUTION OF SALE AGREEMENT IS ALSO ONE OF THE SOURCE S OF INVESTMENT, CANNOT BE ACCEPTED. FINDING NO MERIT IN THE OBSE RVATIONS OF THE LD. CIT(A), WE SET PRINT TO PDF WITHOUT THIS MESSAGE BY PURCHASING NOVAPDF ( HTTP://WWW.NOVAPDF.COM/ ) : - 14 - : ASIDE HIS ORDER ON THIS ISSUE AND DIRECT THE ASSESSING OFFICER TO COMPUTE THE ADDITION ACCORDINGLY. 20 . WITH REGARD TO RECEIPT OF RS.2.50 LAKHS IN CASH FROM MOHD. NASEEM MANSOORI, IT WAS CONTENDED BY THE ASSESSEE THAT THIS AM OUNT WAS RECEIVED IN CASH FROM MOHD. NASEEM MANSOORI WHO IS WORKING IN ABU DHABI, BUT NO CONFIRMATION WAS FILED BEFORE THE ASSESSING OFFICER AND HE ACCORDINGLY DID NOT ACCEPT IT TO BE ONE OF THE SOURCES OF INVESTMENT. 21 . BEFORE THE LD. CIT(A), IT WAS CONTEN DED THAT THIS LOAN WAS GIVEN TO THE ASSESSEE TOWARDS SETTLEMENT OF PREMIUM OF HIS INSURANCE POLICIES. THE LD. CIT(A) ACCEPTED THE CLAIM OF THE ASSESSEE EVEN THOUGH NO EVIDENCE TO THIS EFFECT WAS PLACED BEFORE HIM. 22 . NOW THE REVENUE IS IN APPEAL BEFORE THE T RIBUNAL WITH THE SUBMISSION THAT ONUS IS UPON THE ASSESSEE TO PROVE THAT HE HAS RECEIVED RS.2.50 LAKHS IN CASH FROM MOHD. NASEEM MANSOORI. AT LEAST IN SUPPORT OF THIS CLAIM, A CONFIRMATION SHOULD HAVE BEEN FILED, BUT NO DOCUMENT WAS PLACED EVEN BEFORE THE ASSESSING OFFICER. BEFORE THE LD. CIT(A), ONE CONFIRMATION LETTER WAS FILED, BUT NO EFFORT WAS MADE BY THE LD. CIT(A) TO ASCERTAIN THE VERACITY OF THIS DOCUMENT APPEARING AT PAGE 90 OF THE COMPILATION OF THE ASSESSEE NOR THE LD. CIT(A) MADE HIS EFFORT TO CALL REMAND REPORT FROM THE ASSESSING OFFICER IN THIS REGARD. 23 . THE LD. COUNSEL FOR THE ASSESSEE, ON THE OTHER HAND, HAS SUBMITTED THAT THIS CONFIRMATION WAS FILED BEFORE THE LD. CIT(A) AND HAVING EXAMINED THE SAME, HE ACCEPTED THE CLAIM OF THE ASSESSEE. 24 . HA VING GIVEN A THOUGHTFUL CONSIDERATION TO THE RIVAL SUBMISSIONS AND FROM A CAREFUL PERUSAL OF THE DOCUMENTS , WE ARE OF THE VIEW THAT THE ASSESSING OFFICER HAS NOT DISCUSSED WITH REGARD TO FILING OF THIS CONFIRMATION BEFORE HIM IN THE ASSESSMENT ORDER. THE LD. CIT(A) HAS TAKEN COGNIZANCE OF THIS CONFIRMATION AND WITHOUT MAKING ANY VERIFICATION WITH REGARD TO THIS PRINT TO PDF WITHOUT THIS MESSAGE BY PURCHASING NOVAPDF ( HTTP://WWW.NOVAPDF.COM/ ) : - 15 - : DOCUMENT, HE ACCEPTED THE CLAIM OF THE ASSESSEE. EVEN PROPER LOCAL ADDRESS OF MOHD. NASEEM MANSOORI HAS NOT BEEN MENTIONED ON THIS DOCUMEN T. S OME EMAIL ADDRESS IS GIVEN ON THIS CONFIRMATION WITHOUT HAVING RESIDENTIAL ADDRESS OF THE CREDITOR. A REFERENCE WAS MADE TO ABU DHABI. IN A SITUATION WHERE NO LOCAL ADDRESS HAS BEEN GIVEN, HOW A PERSON OF RESIDENT OF ABU DHABI HAS EXTENDED LOAN IN CASH TO TH E ASSESSEE FOR SETTLEMENT OF HIS INSURANCE POLICY. THE ASSESSEE OUGHT TO HAVE FURNISHED SOME EVIDENCE AS TO WHICH DATE AND WHAT TIME THE LOAN AND CASH WAS GIVEN TO HIM AND HE SHOULD HAVE ALSO FILED EVIDENCE OF THE AVAILABILITY OF MOHD. NASEEM MANSOORI IN INDIA AT THE RELEVANT POINT OF TIME, AS THE LOAN WAS GIVEN IN CASH. OTHERWISE, A LOAN CANNOT BE GIVEN IN CASH FROM AN NRI LIVING IN ABROAD. SINCE THE ONUS IS UPON THE ASSESSEE TO PLACE RELEVANT EVIDENCE IN THIS REGARD, BUT HE DID NOT PLACE THE SAME. WE ARE, THEREFORE, OF THE VIEW THAT ASSESSEE HAS NOT DISCHARGED THE PRIMAR Y ONUS WHICH LAYS ON HIM. ACCORDINGLY, THE ALLEGED RECEIPT OF RS.2.50 LAKHS IN CASH FROM MOHD. NASEEM MANSOORI CANNOT BE TREATED TO BE ONE OF THE SOURCES OF INVESTMENT. 25 . WITH REGARD TO THE AVAILABILITY OF FUNDS OF RS.23,31,473/ - AVAILABLE ON ACCOUNT OF REDEMPTION OF INVESTMENT IN EARLIER YEARS IS CONCERNED, WE FIND THAT BEFORE THE ASSESSING OFFICER , IT WAS CONTENDED THAT THE INVESTMENTS WERE MADE OUT OF REDEMPTION/MATURITY OF EARLIER YEA RS INVESTMENTS IN MUTUAL FUNDS WITH DIFFERENT BANKS, OF WHICH DETAILS ARE AS UNDER: - S.NO. BANK A/C WITH BANK HEAD AMOUNT RECEIVED FROM MF REDEMPTION 1 ICICI BANK 69,239.00 2 IDBI BANK 3,60,356.10 3 CITY BANK 15,65,684.90 PRINT TO PDF WITHOUT THIS MESSAGE BY PURCHASING NOVAPDF ( HTTP://WWW.NOVAPDF.COM/ ) : - 16 - : 26 . THE ASSESSING OFFICER ASKED THE ASSESSEE TO FURNISH DATE - WISE DETAILS OF PREVIOUS YEARS INVESTMENT, BUT THE ASSESSEE NEITHER FURNISHED DATE - WISE DETAILS OF PREVIOUS YEARS INVESTMENT NOR OFFERED ANY CAPITAL GAIN. HE ONLY PRODUCED DATE OF ONE PREVIOUS YEAR INVESTMENT OF RS.2.50 LAKHS DATED 5.3.2007 WHICH SWITCH ED AT ON 7.11.2007 AMOUNTING TO RS.2,62,040/ - OF WHICH CAPITAL GAIN WAS PAID AT RS.12,040/ - . 27 . BEFORE THE LD. CIT(A), THOUGH DETAILS OF REDEMPTION WAS FURNISHED, BUT THE DETAILS OF DATE - WISE INVESTMENT WERE NOT FURNISHED. EVEN IN THE ABSENCE OF DETAILS OF INVESTMENT AND NON - DECLARATION OF CAPITAL GAIN ON ITS REDEMPTION, THE LD. CIT(A) HAS ACCEPTED THE CLAIM OF THE ASSESSEE AND TREATED IT TO BE SOURCE OF INVESTMENT. THE RELEVANT OBSERVATIONS OF THE LD. CIT(A) ARE EXTRACTED HEREUND ER: - 7(4)(VIII)(A) FINALLY, THE ASSESSEE CLAIMS THAT IT RECEIVED RS.23,31,473/ - AS REDEMPTION PROCEEDS OF INVESTMENTS IN MUTUAL FUNDS MADE IN EARLIER YEARS. THE AO HAS MENTIONED THE SAME AT PAGE 5 OF THE ASSESSMENT ORDER AND HAS NOT ACCEPTED THE CLAIM OF THE ASSESSEE ON THE GROUND THAT DETAILS WERE NOT FILED. THE AO AT PAGE 5 OF THE ASSESSMENT ORDER HAS REFERRED TO REDEMPTION PROCEEDS OF RS.19,95,279/ - FROM MUTUAL FUNDS IN EARLIER YEARS, HE HAS NOT ALLOWED THE BENEFIT OF THE REDEMPTION ON THE GROUND THAT T HE DETAILS OF INVESTMENT IN EARLIER YEARS WERE NOT FURNISHED. I AM AT LOSS TO ACCEPT THE FINDING OF THE AO. ONCE THE AO FOUND THE REDEMPTION PROCEEDS ON HIS OWN ANALYSIS OF ASSESSEE'S BANK ACCOUNT, HE SHOULD HAVE ALLOWED THE BENEFIT OF THE SAME. THE AMOUNT OF RS.19,95,279/ - IS MENTIONED IN RESPECT OF THREE BANK ACCOUNTS WITH ICICI BANK (RS.69,239/ - ), IDBI BANK (RS.3,60,356.1) AND CITI BANK (RS.15,65,684.9) IN THE ASSESSMENT ORDER. WHEN THE AMOUNT WAS AVAILABLE AS PER BANK ACCOUNTS, THE AMOUNT SHOULD HAVE BE EN ACCEPTED TOWARDS KNOWN SOURCES OF INCOME. HOWEVER, THE APPELLANT PRINT TO PDF WITHOUT THIS MESSAGE BY PURCHASING NOVAPDF ( HTTP://WWW.NOVAPDF.COM/ ) : - 17 - : HAS SUBMITTED THE DETAILS OF REDEMPTION FROM FOLLOWING INVESTMENTS ON THE BASIS OF THEIR CREDITS IN THE BANK ACCOUNTS (A) CITI BANK S.NO. NAME OF MUTUAL FUND AMOUNT DATE OF CREDI T IN BANK (I) REDEMPTION ON 24/7/2007 FROM DSP SMALL AND MID CAP FUND (DATE OF PURCHASE - 14/11/2006 FOR RS.50,000/ - ) 58,426.13 27/07/2007 (II) REDEMPTION ON 10.9.2007 FROM FRANK FLEXI CAP INDIA OPPUR.(DATE OF PURCHASE :5/4/05 FOR RS.25,000/ - ,13/10/ 05 FOR RS.25,000/ - ,20/12/2005 FOR RS.50,000/ - ) 1,42,667.00 13/09/2007 (III) REDEMPTION ON 10/9/2007 FROM FRANK INDIA PRIMA FUND (PURCHASES DONE THROUGH SIP FROM APRIL 2005) 2,31,339.55 13/09/2007 (IV) REDEMPTION ON 10/9/2007 FROM HDFC EQUITY FUND (PURCHASES DONE THROUGH SIP FROM APRIL 2005) 2,74,097.36 13/09/2007 (V) REDEMPTION ON 10/9/2007 FROM ICICI INFRASTRUCTURE FUND (PURCHASES DONE ON 31/8/2005 FOR RS. 50,000/ - AND 11/10/2006 FOR RS.50,000/ - ) 1,51,133.40 13/09/2007 (VI) REDEMPTION ON 10/9/2007 FROM ICICI DYNAMIC FUND (PURCHASES DONE ON 13/10/2005 FOR RS.50,000/ - AND 20/12/2006 FOR RS.50,000/ - ) 1,38,154.59 13/09/2007 PRINT TO PDF WITHOUT THIS MESSAGE BY PURCHASING NOVAPDF ( HTTP://WWW.NOVAPDF.COM/ ) : - 18 - : (VII) REDEMPTION FROM DSP ML TIGER FUND (DATE OF PURCHASE 05/4/2005 FOR RS. 25000 AND 13/10/2005 FOR RS.25000) 80, 740.38 27/09/2007 (VIII) REDEMPTION FROM RELIANCE GROWTH FUND .DATE OF PURCHASE 11/10/2006 FOR RS. 1,00,000/ - ) 1,07,908.52 27/09/2007 (IX) REDEMPTION FROM BIRLA SUN LIFE EQUITY FUND. DATE OF PURCHASE 20/9/2007 FOR RS.2,500/ - ) 2,465.42 27/09/2007 (X) REDEMPTION FROM BIRLA SUN LIFE MID CAP FUND .DATE OF PURCHASE 20/9/2007 FOR RS.2,500/ - ) 2,467.07 27/09/2007 (XI) REDEMPTION FROM DSP ML EQUITY FUND .DATE OF PURCHASE 5/4/2005 FOR RS.25,000/ - AND 13/10/2005 FOR RS.25,000/ - . 79,897.19 27/09/200 7 (XII) REDEMPTION FROM FIDELITY EQUITY FUND. DATE OF PURCHASE 16/4/2005 FOR RS 50000 AND 13/10/2005 FOR RS 25000). REDEMPTION DATE :24/9/07 1,37,139.09 27/09/2007 (XIII) REDEMPTION FROM RELIANCE VISION FUND (DATE OF PURCHASE 11/10/2006 FOR RS.1,00 ,000). REDEMPTION DATE 24/9/2007 1,20,245.83 27/09/2007 TOTAL 15,26,681.53 (B) ICICI BANK (I) REDEMPTION :ICICI PRU FUSION FUND(SYSTEMATIC WITHDRAWN) 5,000.00 28/12/2007 (II) REDEMPTION :FRANK LINE SMALLER COMPANIES FUND (DATE OF PURCHASE IS 13/11/06 FOR RS.33,000/ - ) 54,239.42 03/01/2008 PRINT TO PDF WITHOUT THIS MESSAGE BY PURCHASING NOVAPDF ( HTTP://WWW.NOVAPDF.COM/ ) : - 19 - : TOTAL 59,239.42 (C) IDBI BANK (I) REDEMPTION : FIDELITY MF (PURCHASE DATE ON EVIDENT : FOLIO NUMBER 1421660/13 58,259.38 18.05.2007 (II) REDEMPTION :HSBC PROGRESSIVE THEMES FUND (PURCHA SE DATE ON EVIDENT : FOLIO NUMBER 326074/23 56,515,75 25/05/2007 (III) REDEMPTION ON 1.6.2007 OF 1010 ING OPTIMIX EQUITY MULTI MANAGEFR FOF SCHEME - GROWTH, FOLIO NO.5033366/86, PURCHASE DATED 22.12.06 FOR RS.1,50,000/ - 154,303.50 18/06/2007 (IV) REDEMPTIO N ON 1.6.2007 OF 1010 ING OPTIMIX EQUITY MULTI MANAGER FOF SCHEME - GROWTH, FOLIO NO.5033357/16, PURCHASE DATED 22.12.2006 FOR RS.1,50,000/ - 154,303.50 18/06/2007 (V) REDEMPTION FROM FIDELITY MF (DATE OF INVESTMENT 28.05.2007 RS.1,00,000. REDEMPTION DATE 2 6/12/2007) 118,051.19 31/12/2007 (VI) REDEMPTION SBI MF :6/7/2007 PURCHASE FOR RS.45,000 DATE OF REDEMPTION 26/12/2007 64,503.00 31/12/2007 PRINT TO PDF WITHOUT THIS MESSAGE BY PURCHASING NOVAPDF ( HTTP://WWW.NOVAPDF.COM/ ) : - 20 - : (VII) REDEMPTION OF FIDELITY MUTUAL FUND : 21/03/2004 PURCHASE FOR RS.50,000/ - 67,174.31 08/01/2008 (VIII) REDEMP TION FROM SBI MUTUAL FUND DATE OF PURCHASE 24/11/2005 DATE OF REDEMPTION 24/7/2007 72,441.40 03/08/2007 TOTAL 7,45,552.03 TOTAL 23,31,472.98 7(4)(VIII)(B) I FIND THAT OUT OF REDEMPTION OF THE AFORESAID MUTUAL FUNDS OF RS.23,31,472.98 IN THE YEAR UNDER CONSIDERATION, THE REDEMPTION OF RS.1,87,486.70 WAS OUT OF INVESTMENT MADE IN THE CURRENT YEAR AND REDEMPTION OF RS.21,43,986.28 WAS OUT OF THE INVESTMENT MADE IN THE EARLIER YEARS AS IS EVIDENT FROM THE DATES GIVEN ABOVE. INVESTMENTS MADE IN THE EARLIER Y EARS CANNOT BE ADDED AS THE INCOME OF THE YEAR UNDER CONSIDERATION. SO FAR AS INVESTMENT OF THE YEAR UNDER CONSIDERATION IS CONCERNED, IT IS OUT OF INCOME/RECEIPTS AS DISCUSSED ABOVE. THE THREE BANK ACCOUNTS OF THE ASSESSEE MAINTAINED WITH ICICI BANK, IDBI RANK AND CITI BANK WERE EXAMINED BY THE AO. THE INTEREST THEREON HAS BEEN ADDED TO THE INCOME OF THE ASSESSEE. THE TRANSACTIONS APPEARING IN THE SAID BANK ACCOUNTS HAVE BEEN CONSIDERED BY THE AO IN COMPLETING THE IMPUGNED ASSESSMENT. THEREFORE THE REDEMPT ION PROCEEDS OF INVESTMENTS MADE IN MUTUAL FUNDS IN THE YEAR UNDER CONSIDERATION AND IN EARLIER YEARS CREDITED IN THE SAID BANK ACCOUNTS ARE TO BE CONSIDERED AS AVAILABLE TO THE APPELLANT FOR MAKING THE IMPUGNED INVESTMENTS FOR WHICH THE ADDITIONS HAVE BEE N MADE BY THE AO. PRINT TO PDF WITHOUT THIS MESSAGE BY PURCHASING NOVAPDF ( HTTP://WWW.NOVAPDF.COM/ ) : - 21 - : 28 . AGGRIEVED, THE REVENUE HAS PREFERRED AN APPEAL BEFORE US WITH THE SUBMISSION THAT IF THE ASSESSEE HAS MADE INVESTMENT IN MUTUAL FUNDS, ON ITS REDEMPTION THE CAPITAL GAIN IS REQUIRED TO BE WORKED OUT, BUT THE ASSESSEE HAS NOT OFFERED ANY CAPITAL GAIN IN THE IMPUGNED ASSESSMENT YEAR AND THIS FACT CANNOT BE IGNORED WHILE ACCEPTING THE RECEIPT OF REDEMPTION FOR THE INVESTMENT. THE LD. D.R. HAS FURTHER CONTENDED THAT ALL THESE DETAILS OF YEAR - WISE INVESTMENT WERE NOT FURNISHED BEFORE THE ASS ESSING OFFICER IN ORDER TO ASCERTAIN THE NATURE OF CAPITAL GAIN AND ITS HOLDINGS. ALL THESE DETAILS WERE FILED BEFORE THE LD. COMMISSIONER OF INCOME - TAX FOR THE FIRST TIME AND THE LD. CIT(A), WITHOUT CALLING REMAND REPORT, HAS ACCEPTED THE SAME AND TREATE D IT TO BE ONE OF THE SOURCES OF INVESTMENTS. 29 . THE LD. COUNSEL FOR THE ASSESSEE, ON THE OTHER HAND, HAS PLACED RELIANCE UPON THE ORDER OF THE LD. CIT(A). 30 . HAVING GIVEN A THOUGHTFUL CONSIDERATION TO THE RIVAL SUBMISSIONS AND FROM A CAREFUL PERUSAL OF THE ORDE RS OF THE AUTHORITIES BELOW, WE FIND THAT BEFORE THE ASSESSING OFFICER THOUGH THE ASSESSEE HAS CLAIMED RECEIPT OF REDEMPTION OF EARLIER DEPOSITS, BUT DETAILS WERE NOT FURNISHED DESPITE OF SPECIFICALLY ASKED BY THE ASSESSING OFFICER. THE DETAILS OF RECEIPT OF REDEMPTION WAS FILED BEFORE THE LD. CIT(A). THE DETAILS OF YEAR - WISE INVESTMENT S WERE NOT FURNISHED IN ORDER TO ASCERTAIN THE NATURE AND QUANTUM OF CAPITAL GAIN. IT IS ALSO NOTICED THAT THE ASSESSEE HAS NOT OFFERED ANY CAPITAL GAIN ON REDEMPTION OF T HESE MUTUAL FUNDS. EVEN THEN, THE LD. CIT(A) HAD ACCEPTED THE CLAIM. IN THE LIGHT OF THE TOTALITY OF THE FACTS, THIS ISSUE WAS NOT PROPERLY EXAMINED BY THE LD. CIT(A) IN THE LIGHT OF YEAR - WISE INVESTMENT IN MUTUAL FUNDS AND ITS REDEMPTION AND ALSO NATURE OF HOLDINGS AND NATURE AND QUANTUM OF CAPITAL GAIN ACCRUED IN THE IMPUGNED ASSESSMENT YEAR. WE, THEREFORE, SET ASIDE THE ORDER OF THE LD. CIT(A) IN THIS REGARD AND RESTORE THE MATTER TO THE FILE OF THE LD. CIT(A) WITH A DIRECTION TO RE - ADJUDICATE THE ISS UE AFRESH IN THE LIGHT OF THE EVIDENCE PRINT TO PDF WITHOUT THIS MESSAGE BY PURCHASING NOVAPDF ( HTTP://WWW.NOVAPDF.COM/ ) : - 22 - : FURNISHED BEFORE HIM AFTER OBTAINING REMAND REPORT FROM THE ASSESSING OFFICER. THE LD. CIT(A) IS ALSO DIRECTED TO EXAMINE THE ASPECT OF CAPITAL GAIN ACCRUED ON THE REDEMPTION OF THESE MUTUAL FUNDS TO EXAMINE THE YEAR OF INVESTMENT IN MUTUAL FUNDS. NEEDLESS TO MENTION HERE THAT PROPER OPPORTUNITY OF BEING HEARD BE AFFORDED TO THE ASSESSEE. ACCORDINGLY THIS ISSUE IS DISPOSED OF. 31 . IN THE RESULT, APPEAL OF THE REVENUE IS PARTLY ALLOWED FOR STATISTICAL PURPOSES. ORDER WAS PRONOUNCED IN THE OPEN COURT ON THE DATE MENT I ONED ON THE CAPTION PAGE. SD/ - SD/ - [ A. K. GARODIA ] [ S UNIL KUMAR Y ADAV ] ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 16 TH SEPTEMBER , 2014 JJ: 0309 COPY FORWARDED TO: 1 . APPELLANT 2 . RESPONDENT 3 . CIT(A) 4 . CIT 5 . DR AS SISTANT REGISTRAR PRINT TO PDF WITHOUT THIS MESSAGE BY PURCHASING NOVAPDF ( HTTP://WWW.NOVAPDF.COM/ )