RAJ SAWHNEY, Jaipur V. ITO, Jaipur

ITA 699/JPR/2016

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 4849 (ITAT-JAIPUR)
• Duration Of Justice: 5 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-12-2016
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: Not Allotted
• Assessment Year: 2011-2012
• Appeal Filed On: 08-07-2016
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: POONAM RAI DCIT DR DHK
• Assessee Lawyers: K L MOOLCHANDAN I
• Keywords: Additional evidence
• Section: 143(3)

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES (SMC), JAIPUR JH HKKXPUN] YS[KK LNL; DS LE{K BEFORE: SHRI BHAGCHAND, ACCOUNTANT MEMBER VK;DJ VIHY LA-@ ITA NO. 699/JP/2016 FU/KZKJ.K O'K Z@ ASSESSMENT YEAR : 2011-12 SHRI RAJ SAWHNEY KUNDAN, 24-KINGS ROAD, AJMERA GARDEN, JAIPUR CUKE VS. THE ITO WARD- 4(4) JAIPUR LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO .: ABWPS 5950 Q VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT FU/KZKFJRH DH VKSJ LS@ ASSESSEE BY: SHRI K.L. MOOLCHANDANI, ADVOCATE JKTLO DH VKSJ LS@ REVENUE BY :SMT. POONAM RAI, DCIT-. DR LQUOKBZ DH RKJH[K@ DATE OF HEARING : 15/12/2016 ?KKS'K .KK DH RKJH[K@ DATE OF PRONOUNCEMENT : 16 /12/2016 VKNS'K@ ORDER PER BHAGCHAND, AM THE ASSESSEE HAS FILED AN APPEAL AGAINST THE ORDE R OF THE LD. CIT(A)-2, JAIPUR DATED 28-04-2016 FOR THE ASSESS MENT YEAR 2011-12 RAISING THEREIN FOLLOWING GROUNDS:- 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) HAS LEGALLY AND FACTUALLY ERRE D IN UPHOLDING THE ADDITION OF RS. 1,42,736/- MADE BY AO ON ACCOUNT OF DISALLOWANCE OF INTEREST PAYMENT WITHOU T APPRECIATING THE FACTS OF THE CASE IN RIGHT PERSPEC TIVE. THUS THE ADDITION SO MADE/ CONFIRMED IS BAD IN LAW AND D ESERVES TO BE DELETED. ITA NO. 699/JP/2016 SHRI RAJ SAWHNEY VS. ITO, WARD- 4(4), JAIPUR . 2 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) HAS LEGALLY AND FACTUALLY ERRE D IN CONFIRMING THE ADDITION MADE BY AO U/S 69A OF THE I .T. ACT, 1961 TO THE EXTENT OF RS. 1,00,000/- OUT OF THE ADD ITION OF RS. 1,50,000/- MADE BY THE AO ON ACCOUNT OF CASH DEPOS ITS IN HIS BANK ACCOUNT WITHOUT APPRECIATING THE FACTS OF THE CASE IN RIGHT PERSPECTIVE. THUS THE ADDITION SO MADE/ CONFI RMED IS BAD IN LAW AND DESERVES TO BE DELETED. 2.1 APROPOS GROUND NO. 1 OF THE ASSESSEE, THE FACTS AS EMERGES FROM THE ORDER OF THE LD. CIT(A) IS AS UNDER:- 2.3 I HAVE PERUSED THE FACTS OF THE CASE, THE ASSESSMENT ORDER AND THE SUBMISSION OF THE APPELLAN T. THE ASSESSEE HAS CLAIMED DEDUCTION OF RS. 1,42,736/- U/ S 24(B) OF THE I.T. ACT, 1961 IN RESPECT OF A SELF OCCUPIED P ROPERTY ON ACCOUNT OF INTEREST PAID ON HOUSE BUILDING LOAN OB TAINED IN RESPECT OF THE SAID PROPERTY. THE ASSESSING OFFICE R, DURING THE ASSESSMENT PROCEEDINGS NOTED THAT THE COPY OF A LLOTMENT OF THE PROPERTY ON WHICH THE INTEREST ON HOUSE BUIL DING ADVANCE WAS BEING CLAIMED, SHOWED THAT THE PROPERTY BELONG TO SMT. USHA SAWHNEY MOTHER OF THE ASSESSEE. HOWEVE R, THE LOAN IS IN THE JOINT NAME OF THE ASSESSEE AND HIS M OTHER. SINCE THE PROPERTY DID NOT BELONG TO THE ASSESSEE, THE CLAIM OF INTEREST U/S 24(B) OF THE I.T. ACT, 1961 WAS DIS ALLOWED. IN THE PRESENT PROCEEDINGS, INITIALLY THE AUTHORIZED REPRESENTATIVE CLAIMED THAT THE PROPERTY WAS IN THE JOINT NAME OF THE ASSESSEE AND HIS MOTHER SMT.USHA SAWHNE Y, HOWEVER, SUBSEQUENTLY, HE HAS CLARIFIED THAT THE PR OPERTY BELONGS ONLY TO THE MOTHER. IT WAS FURTHER SUBMITTE D THAT THE ASSESSEE HAD BEEN CLAIMING THIS INTERESTING THE RET URNS FILED IN EARLIER YEARS AND COPIES OF THE SAME WERE ATTACH ED. A PERUSAL OF THE RETURNS FILED SHOWSTHAT THE SAME WER E PROCESSED UNDER SECTION143(1) AND NO SCRUTINY ASSES SMENT HAS BEEN MADE UNDER SECTION 143(3) OF I.T. ACT, 196 1. THUS THE CLAIM OF THE AUTHORIZED REPRESENTATIVE THAT TH IS DEDUCTION HAS BEEN ALLOWED IN THE EARLIER YEARS CAN NOT BE ACCEPTED. SINCE THE ASSESSEE IS NOT THE OWNER OF TH E PROPERTY, ITA NO. 699/JP/2016 SHRI RAJ SAWHNEY VS. ITO, WARD- 4(4), JAIPUR . 3 THE DEDUCTION MADE IS NOT ALLOWABLE, THE DISALLOWAN CE MADE BY THE ASSESSING OFFICER IS UPHELD. THE GROUND OF A PPEAL OF THE ASSESSEE IS DISMISSED. 2.2 DURING THE COURSE OF HEARING, THE LD. AR OF THE ASSESSEE SUBMITTED THAT THE LOWER AUTHORITIES HAVE ERRED IN DISALLOWIN G THE INTEREST CLAIMED ON HOUSE BUILDING ADVANCE AT RS. 1,42,736/- WHICH SHOU LD BE ALLOWED AS THE LOAN HAD BEEN SANCTIONED BY THE HDFC BANK IN THE JO INT NAME I.E. THE ASSESSEE AND HIS MOTHER SMT. USHA SAWHNEY. 2.3 THE LD. DR RELIED ON THE ORDERS OF THE LOWER AU THORITIES. 2.4 I HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE MATERIALS AVAILABLE ON RECORD. IT IS NOTED FROM THE RECORDS THAT THE ASSESSEE HAD CLAIMED INTEREST ON HOUSE BUILDING ADVANCE AT RS. 1 ,42,736/- FOR WHICH THE AO REQUIRED THE ASSESSEE TO FURNISH THE DETAILS OF INTEREST CLAIMED. THE AO OBSERVED FROM THE DETAILS FURNISHED BY THE A SSESSEE THAT THE LOAN HAD BEEN SANCTIONED IN THE JOINT NAME I.E. THE NAME OF THE ASSESSEE AND HIS MOTHER SMT. USHA SAWHNEY. THE AO FURTHER REQUIR ED THE ASSESSEE TO FURNISH THE DOCUMENTARY PROOF AS TO OWNERSHIP OF T HE PROPERTY ON WHICH HOUSE BUILDING ADVANCE WAS OBTAINED BY THE ASSESSEE . ON PERUSAL OF THE COPY OF THE ALLOTMENT LETTER, THE AO OBSERVED THAT THE PROPERTY WAS IN THE NAME OF THE MOTHER OF THE ASSESSEE I.E. SMT. USHA S AWHNEY WHICH ESTABLISHES THAT THE PROPERTY IN QUESTION WAS NOT I N THE NAME OF THE ITA NO. 699/JP/2016 SHRI RAJ SAWHNEY VS. ITO, WARD- 4(4), JAIPUR . 4 ASSESSEE AND THUS INTEREST CLAIMED BY THE ASSESSEE ON HOUSE BUILDING ADVANCE WAS NOT ALLOWED BY THE AO. IN FIRST APPEAL, THE LD. CIT(A) ALSO CONFIRMED THE ACTION OF THE AO WITH FOLLOWING OBSER VATION. A PERUSAL OF THE RETURNS FILED SHOWS THAT THE SAM E WERE PROCESSED UNDER SECTION143(1) AND NO SCRUTINY ASSESSMENT HAS BEEN MADE UNDER SECTION 143(3) OF I. T. ACT, 1961. THUS THE CLAIM OF THE AUTHORIZED REPRESENTAT IVE THAT THIS DEDUCTION HAS BEEN ALLOWED IN THE EARLIER YEAR S CANNOT BE ACCEPTED. SINCE THE ASSESSEE IS NOT THE OWNER OF TH E PROPERTY, THE DEDUCTION MADE IS NOT ALLOWABLE, THE DISALLOWAN CE MADE BY THE ASSESSING OFFICER IS UPHELD. THE GROUND OF A PPEAL OF THE ASSESSEE IS DISMISSED. LOOKING INTO THE FACTUAL MATRIX OF THE CASE, IT IS OBSERVED THAT THE PROPERTY IN QUESTION IS NOT IN THE NAME OF THE ASSE SSEE WHICH ONLY CONCERNS WITH THE MOTHER OF THE ASSESSEE I.E. SMT. USHA SAWHNEY. SINCE THE PROPERTY IN QUESTION DOES NOT BELONG TO THE ASS ESSEE, THEREFORE, THE INTEREST CLAIMED BY THE ASSESSEE ON HOUSE BUILDING ADVANCE IS NOT ALLOWABLE U/S 24(B) OF THE ACT. HENCE, I FIND NO RE ASON TO INTERFERE WITH THE ORDER OF THE LD. CIT(A) WHICH IS SUSTAINED ON T HIS ISSUE. THUS GROUND NO. 1 OF THE ASSESSEE IS DISMISSED. 3.1 APROPOS GROUND NO. 2 OF THE ASSESSEE, THE FACT S AS EMERGES FROM THE ORDER OF THE LD. CIT(A) IS AS UNDER:- 3.3 I HAVE PERUSED THE FACTS OF THE CASE, THE ASSESSMENT ORDER AND THE SUBMISSIONS OF THE APPELLA NT. THE ITA NO. 699/JP/2016 SHRI RAJ SAWHNEY VS. ITO, WARD- 4(4), JAIPUR . 5 ASSESSING OFFICER DURING THE ASSESSMENT PROCEEDINGS NOTICED A CASH DEPOSIT OF RS. 1,50,000/-IN THE BANK ACCOUNT O F THE ASSESSEE. REGARDING THE SOURCES, THE ASSESSEE STATED THAT THE SAME WERE FROM SALE PROCEEDS OF AN OLD WAGON R CAR AND THE AMOUNT HAD BEEN DEPOSITED ON 19-04-2010. THE CAR WAS TRANSFERRED IN THE NAME OF THE SELLER ON 05-05-2010. SINCE NO DOCUMENTARY EVID ENCES HAVE BEEN FURNISHED TO SHOW THE RECEIPT OF CASH OF RS. 1 ,50,000/- AGAINST THE SALE OF CAR, THE SAME WAS DISALLOWED AND THE AM OUNT DEPOSITED WAS TREATED AS FROM UNDISCLOSED SOURCES. IN THE PRE SENT PROCEEDINGS, THE ASSESSEE HAS REITERATED THE SAME S UBMISSIONS AS BEFORE THE ASSESSING OFFICER. CERTIFICATE OF REGIST RATION OF CAR EVIDENCING THE TRANSFER OF OWNERSHIP ON 05-05-2010 TO SHRI HARI OM BHARDWAJ HAVE BEEN FILED, AS ALSO AN AFFIDAVIT F ROM SHRI SURENDRA JAIN, SAID TO BE A BROKER OF SECOND HAND C ARS, WHO HELPED IN THE SALE OF THE CAR. ADEQUATE OPPORTUNITY HAD B EEN PROVIDED DURING THE ASSESSMENT PROCEEDINGS, HOWEVER, NO EVID ENCE WAS PRODUCED BEFORE THE ASSESSING OFFICER. FURTHER NO E XCEPTIONAL CIRCUMSTANCES OR EVEN AN APPLICATION FOR ADMITTANCE OF ADDITIONAL EVIDENCE HAD BEEN MADE BEFORE ME. THUS THE AFFIDAVI T WHICH IS AN AFTER THOUGHT AND A SELF SERVING DOCUMENT IS REJECT ED AND NOT TAKEN INTO ACCOUNT. AS REGARDS THE REGISTRATION PAPERS OF THE CAR, THE SAME SHOW A CHANGE OF OWNERSHIP BUT NO EVIDENCE OF AMOUN T FOR THE SAME HAS BEEN PRODUCED. HOWEVER, AN AMOUNT OF RS. 5 0,000/- IS ALLOWED FOR THE SAME AND THE BALANCE AMOUNT OF RS. 1,00,000- IS CONFIRMED AS UNEXPLAINED DEPOSITS. THE GROUND OF AP PEAL OF THE ASSESSEE IS PARTLY ALLOWED. 3.2 DURING THE COURSE OF HEARING, THE LD. AR OF THE ASSESSEE SUBMITTED THAT THE LD. CIT(A) HAD ERRED IN RESTRICTING THE A DDITION MADE BY AO U/S 69A TO THE EXTENT OF RS. 1.00 LACS OUT OF THE ADDIT ION OF RS. 1.50 LACS MADE BY THE ON ACCOUNT OF CASH DEPOSITS IN HIS BAN K ACCOUNT WITHOUT APPRECIATING THE FACTS OF THE CASE WHICH SHOULD BE ALLOWED. 3.3 THE LD. DR RELIED ON THE ORDERS OF THE LOWER AU THORITIES. ITA NO. 699/JP/2016 SHRI RAJ SAWHNEY VS. ITO, WARD- 4(4), JAIPUR . 6 3.4 I HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE MATERIALS AVAILABLE ON RECORD. IT IS NOTED FROM THE RECORDS THAT THE ASSESSEE HAD DEPOSITED A SUM OF RS. 1.50 LACS IN HDFC BANK ACCOU NT DURING THE YEAR UNDER CONSIDERATION FOR WHICH THE AO REQUIRED FROM THE ASSESSEE TO EXPLAIN THE SOURCE OF CASH DEPOSITED IN THE BANK AM OUNTING TO RS. 1.50 LACS. THE ASSESSEE SUBMITTED BEFORE THE AO THAT HE HAD SOLD THE OLD WAGON R DURING THE YEAR 2010-11 FOR RS. 1.50 LACS A ND THUS THE AMOUNT HAD BEEN DEPOSITED ON 19-04-2010 IN THE BANK ACCOUN T. THE ASSESSEE FURTHER SUBMITTED THAT THE CAR WAS PURCHASED BY HIM ON 29-09-2005 FOR RS. 3.70 LACS WHICH WAS FIVE YEAR OLD AND SUBSEQUEN TLY THE CAR WAS TRANSFERRED IN THE NAME OF BUYER SHRI HARI OM BHARD AWAJ ON 05-05- 2010. THE AO OBSERVED THAT THE ASSESSEE NEITHER FUR NISHED THE DOCUMENTARY EVIDENCE REGARDING RECEIPT OF RS. 1.50 LACS FROM SALE OF CAR NOR EXPLAINED THE NATURE AND SOURCE OF THE CASH DEP OSITED IN THE BANK ACCOUNT BEFORE THE AO WHICH HE TREATED IT AS UNEXPL AINED AMOUNT U/S 69A OF THE ACT. THUS THE AO TREATED THE AMOUNT OF RS. 1 .50 LACS OF THE ASSESSEE AS UNEXPLAINED INCOME U/S 69A OF THE ACT A ND ADDED THE SAME TO HIS TOTAL INCOME WHICH HAS BEEN REDUCED BY THE LD. CIT(A) TO THE EXTENT OF RS. 1.00 LACS WITH FOLLOWING OBSERVATIONS. ITA NO. 699/JP/2016 SHRI RAJ SAWHNEY VS. ITO, WARD- 4(4), JAIPUR . 7 CERTIFICATE OF REGISTRATION OF CAR EVIDENCING THE TRANSFER OF OWNERSHIP ON 05-05-2010 TO SHRI HARI O M BHARDWAJ HAVE BEEN FILED, AS ALSO AN AFFIDAVIT FROM SHRI SUR ENDRA JAIN, SAID TO BE A BROKER OF SECOND HAND CARS, WHO HELPED IN THE SALE OF THE CAR. ADEQUATE OPPORTUNITY HAD BEEN PROVIDED DURING THE A SSESSMENT PROCEEDINGS, HOWEVER, NO EVIDENCE WAS PRODUCED BEFO RE THE ASSESSING OFFICER. FURTHER NO EXCEPTIONAL CIRCUMSTA NCES OR EVEN AN APPLICATION FOR ADMITTANCE OF ADDITIONAL EVIDENCE H AD BEEN MADE BEFORE ME. THUS THE AFFIDAVIT WHICH IS AN AFTER THO UGHT AND A SELF SERVING DOCUMENT IS REJECTED AND NOT TAKEN INTO ACC OUNT. AS REGARDS THE REGISTRATION PAPERS OF THE CAR, THE SAME SHOW A CHANGE OF OWNERSHIP BUT NO EVIDENCE OF AMOUNT FOR THE SAME HA S BEEN PRODUCED. HOWEVER, AN AMOUNT OF RS. 50,000/- IS ALL OWED FOR THE SAME AND THE BALANCE AMOUNT OF RS. 1,00,000- IS CON FIRMED AS UNEXPLAINED DEPOSITS. THE GROUND OF APPEAL OF THE A SSESSEE IS PARTLY ALLOWED. DURING THE COURSE OF APPELLATE PROCEEDING, THE LD. AR OF THE SUBMITTED THE CERTIFICATE OF REGISTRATION OF THE CAR BEARING NO. RJ-14-CA-6520 WHICH ESTABLISHES THAT THE ASSESSEE WAS THE OWNER O F THE CAR -MARUTI WAGON R WHICH HAD BEEN SOLD TO SHRI HARI OM BHARDWA J AND THE DATE OF TRANSFER WAS MENTIONED IN THE R.C. ON 05-05-2010. T HE DEPOSIT OF AN AMOUNT OF RS. 1.50 LACS IN HDFC BANK SHOWS ON 19-04 -2010 AND THE TRANSFER OF THE REGISTRATION OF THE CAR IN REGISTRA TION CERTIFICATE OF RTO SHOWS ON 5-05-2010 WHICH ESTABLISHES THAT WHENEVER THE OLD CAR IS SOLD TO THE PARTY THEN IT TAKES TIME TO CHANGE THE OWNERSH IP FROM SELLER TO BUYER. IT IS ALSO NOTED FROM THE REGISTRATION CERTIFICATE THAT TRANSFER OF THE CAR WAS MADE ON 05-05-2010 IN THE NAME OF SHRI HARI OM BHARDWAJ S/O SHRI ITA NO. 699/JP/2016 SHRI RAJ SAWHNEY VS. ITO, WARD- 4(4), JAIPUR . 8 CHIRANJI LAL R/O 18-A, SRI RAM NAGAR JHOTWARA, JAIP UR. HENCE, IN VIEW OF THE ABOVE FACTS AND CIRCUMSTANCES OF THE CASE, T HE ASSESSEE DESERVES RELIEF ON THIS COUNT AND THE ADDITION SUSTAINED BY THE LD. CIT(A) TO THE EXTENT OF RS. 1.00 LAC IS DELETED. THUS GROUND NO. 2 OF THE ASSESSEE IS ALLOWED. 4.0 IN THE RESULT, THE APPEAL OF THE ASSESSEE IS P ARTLY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 16 /12 /2016 SD/- HKKXPUN ( BHAGCHAND) YS[KK LNL;@ ACCOUNTANT MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 16 /12/ 2016 *MISHRA VKNS'K DH IZFRFYFI VXZSF'KR@ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ@ THE APPELLANT- SHRI RAJ SAWHNEY, JAIPUR 2. IZR;FKHZ@ THE RESPONDENT- THE ITO, WARD- 4(4), 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. 699/JP/2016 ) VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ @ ASSISTANT. REGISTRAR