Income Tax Officer, Ward- 6(3)(1), Bangalore V. Sri. Vidyaranya Pujar, Bengaluru

ITA 738/BANG/2020

• Counselvise Citation: [2021] 108 COUNSELVISE.COM (IT) 1152 (ITAT-BANGALORE)
• Duration Of Justice: 6 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-07-2021
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Assessment Year: 2014-2015
• Appeal Filed On: 16-12-2020
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Unexplained investment; Gift
• Section: 69

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH : BANGALORE BEFORE SHRI N.V. VASUDEVAN, VICE PRESIDENT AND SHRI CHANDRA POOJARI , ACCOUNTANT MEMBER IT A NO . 738/ BANG/2020 ASSESSMENT YEAR : 2014 - 15 THE INCOME TAX OFFICER, WARD 6(3)(1), BENGALURU. VS. SRI VIDYARANYA PUJAR, SAI GEETHANJALI, 3 RD CROSS . MATHIKERE, BENGALURU 560 054. PAN: ALZPP 2890F APPELLANT RESPONDENT APPELLANT BY : NONE RESPONDENT BY : NONE DATE OF HEARING : 05.07 .2021 DATE OF PRONOUNCEMENT : 05 .0 7 .202 1 O R D E R PER CHANDRA POOJARI, ACCOUNTANT MEMBER THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST THE ORDER OF CIT(APPEALS)-13, BENGALURU DATED 31.01.2020 FOR THE ASSESSMENT YEAR 2014-15. 2. THE REVENUE HAS RAISED THE FOLLOWING GROUNDS:- 1. THE ORDER OF THE LEARNED CIT (APPEALS), IN SO FAR AS IT IS PREJUDICIAL TO THE INTEREST OF REVENUE, IS OPPOSED TO LAW AND THE FACTS AND CIRCUMSTANCES OF THE CASE. 2. IN VIEW OF THE FACTS AND CIRCUMSTANCES OF THE C ASE AND IN LAW, THE LD CIT- A HAS ERRED IN IGNORING :HE FACT T HAT THE ASSET WAS TRANSFERRED TO THE ASSESSEE BY A WAY OF GIFT DE ED EXECUTED BY ITA NO.738/BANG/2020 PAGE 2 OF 4 HIS PARENTS DURING THE FY 2007-08, WHEREAS THE ASSE SSEE HAS INTRODUCED THE SAID PROPERTY IN TO HIS BOOKS OF ACC OUNT DURING THE FY 2013-14 ONLY. 3. IN VIEW OF THE FACTS AND CIRCUMSTANCES OF THE C ASE AND IN LAW, THE LD CIT- A HAS ERRED IN DELETING THE ADDITI ON OF RS. 5,93,58,000/- MADE U/S 69 OF THE IT ACT IGNORING TH E FACT THAT THE FIXED ASSET VALUED AT RS. 5,93,58,000/- WAS BROUGHT IN TO THE BOOKS OF ACCOUNTS DURING THE FY RELEVANT TO AY 2014 -15 FOR THE FIRST TIME WITHOUT ANY EXPLANATION FOR THE SOURCES FOR ACQUISITION DURING THE RELEVANT AY 2014-15. 4. IN VIEW OF THE FACTS AND CIRCUMSTANCES OF THE C ASE AND IN LAW, THE LD CIT- A HAS ERRED IN ACCEPTING THE ASSES SEE'S CONTENTION THAT EVEN IF THE APPELLANT HAD OWNERSHIP OVER THE PROPERTY PRIOR TO THE AY 2013-14 BUT HAD NO INCOME, HE WAS NOT OBLIGED TO FILE HIS RETURN OF INCOME AND OR CAPITAL ACCOUNT WHEN ASSESSEE HAS NOT FURNISHED ANY EVIDENCE IN SUPPORT OF THE CONTENTION THAT HE HAD NO TAXABLE INCOME DURING THE EARLIER YEARS. 5. IN VIEW OF THE FACTS AND CIRCUMSTANCES OF THE CA SE AND IN LAW, THE LD CIT- A HAS ERRED IN TAKING THE VALUE OF THE PROPERTY DECLARED BY THE ASSESSEE WHEN THE AO HAS CLEARLY ST ATED THAT THE ASSESSEE COULD NOT FURNISH ANY PROOF/ EVIDENCE REGA RDING THE ORIGINAL VALUE OF THE PROPERTY. 6. FOR THESE AND SUCH OTHER GROUNDS THAT MAY BE URG ED AT THE TIME OF HEARING, IT IS HUMBLY PRAYED THAT THE ORDER OF THE LD. CIT (A) BE REVERSED AND THAT OF THE ASSESSING OFFICER B E RESTORED. 7. THE APPELLANT CRAVES LEAVE TO ADD, TO ALTER, TO AMEND OR DELETE ANY OF THE GROUNDS THAT MAY BE URGED AT THE TIME OF HEARING OF APPEAL. 3. NONE APPEARED FOR THE ASSESSEE OR THE DEPARTMEN T. WE PROCEED TO DECIDE THE APPEAL AFTER GOING THROUGH THE RECORD AN D ORDERS OF THE LOWER AUTHORITIES. 4. THE BRIEF FACTS OF THE CASE ARE THAT DURING THE COURSE OF ASSESSMENT IT WAS FOUND THAT DURING THE ASSESSEE HAD INTRODUCE D A CAPITAL OF ITA NO.738/BANG/2020 PAGE 3 OF 4 RS.5,93,58,500 TO HIS CAPITAL ACCOUNT AND SHOWN IT AS FIXED ASSETS IN THE FORM OF IMMOVABLE PROPERTY IN THE CAPITAL ACCOUNT. ACCORDING TO THE AO, THE ASSESSEE HAS NOT GIVEN ANY SATISFACTORY EXPLANA TION AND HENCE THE SAME WAS TREATED AS UNEXPLAINED INVESTMENT U/S. 69 OF THE INCOME-TAX ACT, 1961 [THE ACT]. 5. ON APPEAL, THE CIT(APPEALS) DELETED THE ADDITION OBSERVING THAT THE ASSESSEE RECEIVED THE PROPERTY FROM HIS PARENTS IN THE YEAR 2007-08 VIDE GIFT DEED EXECUTED ON 16.6.2007. THE IMPUGNED PROP ERTY IS SITUATED IN NORTH BLOCK BEARING NO.106, SATYA GREENS, THINDLU, VIDYANARAYANAPURA POST, BANGALORE 97. THE CIT(A) OBSERVED THAT THE PROPERTY WAS OWNED BY ASSESSEE PRIOR TO AY 2013-14, BUT HAD NO INCOME. ACCORDINGLY THE ASSESSEE NOT FILING RETURN OF INCOME AND CAPITAL AC COUNT CANNOT BE CONSIDERED AS DEFAULT ON THE PART OF ASSESSEE AND A SSESSEE WAS NOT REQUIRED TO FILE RETURN OF INCOME AND CAPITAL ACCOU NT OR THE WEALTH TAX RETURN FOR THE EARLIER YEAR. FURTHER THE ADDRESS OF THE P ROPERTY MENTIONED BY THE AO IN HIS ORDER DOES NOT MATCH WITH THE GIFT DEED. THE PROPERTY WAS INDEED TRANSFERRED BY THE ASSESSEES PARENTS TO THE ASSESSEE IN THE FY 2007-08 AND THE SAID PROPERTY WAS ANCESTRAL PROPERT Y WHICH WAS GIVEN BY WILL TO THE ASSESSEES MATERNAL GRAND MOTHER IN 194 7 AND LATER GIFTED TO THE ASSESSEES MOTHER IN 1980. VALUATION OF THE PROPER TY HAS BEEN DONE IN THE FY 2013-14 AND THE ASSESSEE ACCEPTED THAT IT IS A C ASE OF REVALUATION OF PROPERTY, HOWEVER THE VALUATION OF PROPERTY WOULD N OT RESULT IN TAXATION OF PROPERTY IN THE HANDS OF ASSESSEE AND THE VALUE SHO WN BY THE ASSESSEE CANNOT BE CONSIDERED AS UNEXPLAINED INVESTMENT U/S. 69 OF THE ACT, WHICH RELATES TO WHETHER THE ASSESSEE HAS MADE INVESTMENT WHICH WAS NOT RECORDED IN THE BOOKS OF ACCOUNT. IN THE PRESENT C ASE, THE ASSESSEE SHOWN IT IN HIS CAPITAL ACCOUNT WHICH WOULD NOT ATT RACT SECTION 69 OF THE ACT. MORE SO, THE CIT(A) OBSERVED THAT ASSESSEE RECEIVE D THE PROPERTY VIDE GIFT DEED FROM HIS CLOSE RELATIVE BEING A PARENT WH ICH IS EXEMPT U/S. ITA NO.738/BANG/2020 PAGE 4 OF 4 56(2)(VII) OF THE ACT. AFTER GOING THROUGH THE FA CTS OF THE CASE, WE ARE OF THE OPINION THAT THE CIT(APPEALS) HAS TAKEN CORRECT VIEW OF THE FACTS AND CIRCUMSTANCES OF THE CASE AND WE DO NOT FIND ANY IN FIRMITY IN THE FINDINGS OF THE CIT(APPEALS). THE SAME IS CONFIRMED. 6. IN THE RESULT, THE APPEAL BY THE REVENUE IS DISM ISSED. PRONOUNCED IN THE OPEN COURT ON THIS 05 TH DAY OF JULY, 2021. SD/- SD/- ( N V VASUDEV AN ) ( CHANDRA POOJARI ) VICE PRESIDENT ACCOUNTANT MEMBER BANGALORE, DATED, THE 05 TH JULY, 2021. / DESAI S MURTHY / COPY TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR, ITAT, BANGALORE. BY ORDER ASSISTANT REGISTRAR ITAT, BANGALORE.