Sh. Harchand Singh, Chandigarh V. ITO, Chandigarh

ITA 996/CHANDI/2013

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 81016 (ITAT-CHANDIGARH)
• Duration Of Justice: 1 year(s) 1 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-11-2014
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 18-11-2014
• Assessment Year: 2010-2011
• Appeal Filed On: 18-10-2013
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: J S NAGAR

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL CHANDIGARH BENCH B, CHANDIGARH BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER AND SHRI T.R.SOOD, ACCOUNTANT MEMBER ITA NO. 996/CHD/2013 ASSESSMENT YEAR : 2010-11 SH. HARCHAND SINGH, VS. THE INCOME TAX OFFICER, S/O SH.KAKA SINGH, WARD 5(4), MILK COLONY, VILLAGE DHANAS, CHANDIGARH. CHANDIGARH. PAN: BCAPS1755D (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI ANIL BATRA RESPONDENT BY : SHRI J.S.NAGAR, DR DATE OF HEARING : 18.11.2014 DATE OF PRONOUNCEMENT : 20.11.2014 O R D E R PER BHAVNESH SAINI, J.M. : THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAI NST THE ORDER OF LEARNED COMMISSIONER OF INCOME TAX (APPEALS)-, CHANDIGARH DATED 14.8.2013 FOR ASSESSME NT YEAR 2010-11. 2. THE GROUND NO.1 IS GENERAL AND THE LEARNED COUNS EL FOR THE ASSESSEE DID NOT PRESS GROUND NO.4 OF THE APPEAL. THEREFORE, THESE GROUNDS ARE DISMISSED. 3. ON GROUND NO.2, THE ASSESSEE CHALLENGED THE ADDI TION OF RS.14 LACS ON ACCOUNT OF CASH DEPOSITS IN THE BA NK ACCOUNT. 2 4. THE BRIEF FACTS OF THE ISSUE ARE THAT THE ASSESS EE HAD MADE CASH DEPOSITS IN HIS SAVING BANK ACCOUNT WITH UNION BANK OF INDIA, CHANDIGARH DURING THE YEAR UNDER CONSIDERATION. THE ASSESSING OFFICER ASKED THE AS SESSEE TO EXPLAIN THE SOURCE OF CASH DEPOSIT OF RS.14 LACS ON 2.6.2009 IN THIS BANK ACCOUNT AND THE ASSESSEE SUBM ITTED AN AGREEMENT TO SELL DATED 27.10.2008 ENTERED INT O BY HIS FATHER LATE SHRI KAKA SINGH WITH ONE SHRI TEJIN DER SINGH FOR SALE OF HIS LAND FOR RS.20 LACS. AS PER THE AGREEMENT, RS.15 LACS WERE RECEIVED ON 27.10.2008 A ND RS.2,50,000/- EACH WERE RECEIVED ON 30.11.2008 AND 15.12.2008. SHRI KAKA SINGH DIED ON 26.12.2008. THE ASSESSEE HAD ALSO PRODUCED A COPY OF DOCUMENT TO TH E EFFECT THAT THE ASSESSEE AND HIS TWO SISTERS HAD AG REED THAT SISTERS WILL NOT TAKE THEIR SHARE IN THE PROPE RTY OF THEIR FATHER AND IN RETURN, THE ASSESSEE SHALL BEAR ALL THE LIABILITIES OF THE DECEASED FATHER. THE ASSESSING OFFICER, HOWEVER, DID NOT ACCEPT THE PLEA OF THE ASSESSEE FO R THE FOLLOWING REASONS :- I) THE BROTHER OF THE ASSESSEE SHRI GURCHARAN SINGH WAS NOT A PARTY TO THE DOCUMENTARY EVIDENCE PRODUCED TO PROVE THAT THE BROTHER HAD FORGONE HIS RIGHT IN FAVOUR OF THE ASSESSEE. II) THE ASSESSEE HAD NOT PRODUCED THE PURCHASER OR THE DOCUMENTS TO ESTABLISH THE IDENTITY, 3 CREDITWORTHINESS OF THE BUYER AND GENUINENESS OF THE TRANSACTION. III) THE AMOUNT WAS RECEIVED IN THE MONTH OF OCTOBER/NOVEMBER 2008 AND THE ASSESSEE HAD NOT PRODUCED THE BANK ACCOUNTS OF HIS FATHER OR EVIDENCE AS TO HOW THIS AMOUNT WAS INVESTED BY HIS FATHER. THE ASSESSING OFFICER ACCORDINGLY, MADE ADDITION. 5. THE ASSESSEE CHALLENGED THE ADDITION BEFORE THE LEARNED CIT (APPEALS) AND IT WAS EXPLAINED THAT THE ISSUE OF RELINQUISHMENT OF THE BROTHER OF THE ASSESSEE NE VER CAME UP DURING THE ASSESSMENT PROCEEDINGS. THE RELINQUISHMENT DEED OF THE BROTHER OF THE ASSESSEE WAS FILED BEFORE THE LEARNED CIT (APPEALS). IT WAS SU BMITTED THAT THE CONTROL OF THE TRANSACTION WAS WITH THE FA THER OF THE ASSESSEE AND THERE WAS NO OCCASION TO PRODUCE S HRI TEJINDER SINGH, THE PURCHASER, NOR HE WAS CALLED UP ON TO BE PRODUCED. THE ENTIRE TRANSACTION WAS IN CASH A ND THE CASH WAS KEPT AT HOME BY THE FATHER OF THE ASSESSEE . THEREFORE, NO PASSBOOK WAS SUBMITTED. THE LEARNED CIT (APPEALS), HOWEVER, DID NOT ACCEPT THE CONTENTION O F THE ASSESSEE AND DISMISSED THE APPEAL. HIS FINDINGS I N PARA 3.3 ARE REPRODUCED AS UNDER: 3.3 I HAVE CONSIDERED THE SUBMISSION OF THE LD. COUNSEL . THE IMPUGNED CASH DEPOSIT WAS MADE ON 02.06.2009. IT IS SURPRISING THAT SUCH A HUGE AMOUNT WAS KEPT IN CASH BY THE LATE FATHER OF THE APPELLANT FOR ALMOST TWO MONTHS AND IT IS 4 UNBELIEVABLE THAT THE AMOUNT WAS KEPT IN CASH EVEN BY THE APPELLANT FOR MORE THAN FIVE MONTHS. IF THE SAI D CASH WAS AVAILABLE WITH THE APPELLANT, HE WOULD HAVE CERTAIN LY DEPOSITED THE SAME IN HIS BANK ACCOUNT, WHICH WOULD HAVE BEEN SAFER AND THE APPELLANT WOULD HAVE ALSO EARNED INTEREST ON THE SAME. THE TIME GAP BETWEEN THE RECEIPT OF MONEY BY THE FATHER OF THE APPELLANT AND DEPOSIT IN THE BANK ACCOUNT OF THE APPELLANT IS TOO LARGE TO EXPLAIN THE SOURCE OF THE IMPUGNED DEPOSIT OF RS. 14,00,000/-. MOREOVER, THE IMPUGNE D CASH IS STATED TO BE PART OF THE AMOUNT RECEIVED ON ACCOUNT OF 'AGREEMENT TO SELL' OF LAND, BUT THE SAID SALE OF L AND IS NOT REGISTERED TILL DATE. HENCE, THE ADDITION MADE BY THE ASSESSING OFFICER IS CONFIRMED, THOUGH FOR DIFFERE NT REASONS. GROUND OF APPEAL NO. 2 IS DISMISSED. 6. ON CONSIDERATION OF THE RIVAL SUBMISSIONS, WE DO NOT FIND ANY MERIT IN THIS GROUND OF APPEAL OF THE ASSE SSEE. THE LEARNED COUNSEL FOR THE ASSESSEE REFERRED TO TH E AGREEMENT TO SELL, MUTUAL CONSENT ENTERED INTO BY THE ASSESSEE AND HIS SISTERS AND REFERRED TO BANK STATE MENT AND REITERATED THE SAME SUBMISSIONS. 7. ON THE OTHER HAND, THE LEARNED D.R. FOR THE REVE NUE SUBMITTED THAT THE SOURCE OF CASH DEPOSITS IN THE B ANK ACCOUNT HAS NOT BEEN PROVED THROUGH ANY RELIABLE EVIDENCE. ON GOING THROUGH THE AGREEMENT TO SELL AND OTHER DOCUMENTS ON RECORD, IT IS CLEAR THAT THE ASS ESSEE HAD FAILED TO PROVE THE SOURCE OF THE CASH DEPOSITS IN HIS BANK ACCOUNT IN A SUM OF RS.14 LACS. THE ALLEGED AGREEMENT TO SELL IS DATED 27.10.2008 BETWEEN THE FATHER OF THE ASSESSEE AND ONE SHRI TEJINDER SINGH FOR SAL E OF LAND BUT THE PARTIES TO THE AGREEMENT NEVER EXECUTE D ANY REGISTERED DOCUMENT FOR TRANSFERRING THE OWNERS RI GHT IN 5 FAVOUR OF THE PURCHASER. THE ALLEGED RECEIPT OF C ASH BY FATHER OF THE ASSESSEE IS STATED TO BE ON 27.10.200 8 AND REMAINING AMOUNT ON 30.11.2008 AND 15.12.2008 BUT I T IS NOT EXPLAINED HOW THE HUGE CASH WAS KEPT AT THE RESIDENCE OF THE ASSESSEE. IT IS NOT EXPLAINED AS TO WHY EVEN AFTER THE DEATH OF FATHER OF THE ASSESSEE ON 26.12.2008, HUGE CASH WAS KEPT AT THE RESIDENCE WIT HOUT ANY REASON. IT IS ALSO NOT EXPLAINED WHY THE ENTI RE FAMILY OF THE ASSESSEE HAVE NOT EXECUTED THE DOCUMENTS FOR BIFURCATION OF THE CASH KEPT AT THE RESIDENCE OR RELINQUISHING ANY RIGHT IN THE CASH EVEN AFTER THE DEATH OF THE FATHER OF THE ASSESSEE. THE BROTHER OF THE AS SESSEE WAS NOT A PARTY TO ANY RELINQUISHMENT DEED EARLIER. THE ASSESSEE NEVER PRODUCED THE PURCHASER OF THE PROPER TY SHRI TEJINDER SINGH FOR CONFIRMING THE TRANSACTION WITH HIS FATHER. THEREFORE, THE IDENTITY AND CREDITWOR THINESS OF THE PURCHASER SHRI TEJINDER SINGH WAS NOT PROVED , THEREFORE, THE GENUINENESS OF THE TRANSACTION WAS N EVER PROVED BY THE ASSESSEE. THE ASSESSEE DID NOT PROD UCE ANY COGENT EVIDENCE BEFORE THE AUTHORITIES BELOW TO PROVE HIS CASH BEYOND DOUBT. IT APPEARS THAT AFTER DEPOS ITING UNACCOUNTED CASH IN THE ACCOUNT OF THE ASSESSEE, AL L THE PAPERS WERE MANAGED SUBSEQUENTLY BY THE ASSESSEE. THE HON'BLE SUPREME COURT IN THE CASES OF CIT VS. DURG A PRASAD MORE, 82 ITR 540 AND SUMATI DAYAL VS. CIT, 2 14 ITR 801 (SC) HAVE HELD THAT THE COURTS AND TRIBUNALS HAVE TO JUDGE THE EVIDENCE BEFORE THEM BY APPLYING TEST OF HUMAN PROBABILITIES . IF THE SAID TEST IS APPLIED ON THIS 6 ISSUE, IT IS CLEARLY ESTABLISHED THAT THE ASSESSEE HAD FAILED TO PROVE THE SOURCE OF THE CASH DEPOSITS OF RS.14 L ACS IN HIS BANK ACCOUNT. THE DOCUMENTS PRODUCED ON RECOR D ARE NOT LIABLE TO DECIDE THE ISSUE IN FAVOUR OF THE ASSESSEE. ACCORDINGLY, WE DO NOT FIND ANY MERIT I N THIS GROUND OF APPEAL OF THE ASSESSEE. THE SAME IS ACCORDINGLY, DISMISSED. 8. ON GROUND NO.3, THE ASSESSEE CHALLENGED ADDITION OF RS.16 LACS ON ACCOUNT OF CASH DEPOSITS IN THE BANK ACCOUNT. 9. THE BRIEF FACTS OF THE ISSUE ARE THAT THE ASSESS EE HAD RECEIVED FOLLOWING AMOUNTS ON ACCOUNT OF AGREEMENT TO SELL DATED 4.6.2009 FOR SALE OF A PORTION OF HIS R ESIDENTIAL HOUSE TO ONE SHRI JORAWAR SINGH FOR RS.16 LACS :- DATE AMOUNT (IN RS.) 4.6.2009 3,00,000/- 11.6.2009 10,50,000/- 29.6.2009 2,40,000/- 14.7.2009 10,000/- TOTAL 16,00,000/ - 10. THE ASSESSEE ALSO FILED AFFIDAVIT OF SHRI JORAW AR SINGH BEFORE THE ASSESSING OFFICER, WHO DID NOT AGR EE WITH THE REPLY OF THE ASSESSEE AND MADE ADDITION OF RS.1 6 LACS WITH THE FOLLOWING OBSERVATIONS :- (I) THERE IN INHERENT CONTRADICTION TO REGARDING RECEIPT OF CASH OF RS. 3,00,000/- ON 04.06.2009 AS PER ALLEGED 'AGREEMENT TO SELL' WHEREAS THE BANK DEPOSIT OF RS. 3,00,000/- ON THAT 7 DATE ARE ON ACCOUNT OF CLEARANCE, OF SOME INSTRUMENT AND NOT ON ACCOUNT OF CASH AS CLAIMED BY THE ASSESSEE. (II) NEITHER THE ASSESSEE BROUGHT ON RECORD THE DOCUMENT PROVING THE CREDITWORTHINESS OF THE SAID PURCHASER AND GENUINENESS OF THE TRANSACTION NOR THE SAID PURCHASER ANYWHERE MENTIONED HIS SOURCE OF THE SAID PAYMENTS TO THE ASSESSEE. (III) AS MENTIONED IN THE ALLEGED 'AGREEMENT TO SELL' ITSELF THAT THE SAID HOUSE WAS ON LEASE IN THE NAME OF THE DECEASED FATHER OF THE ASSESSEE, ASSESSEE ALONE WAS NOT COMP ETENT TO SELL THE SAID HOUSE AND NOBODY WILL PAY THE ENTIRE CONSIDERATION OR A MAJORITY AMOUNT OF THE CONSIDERATION AT THE TIME OF AGREEMENT ITSELF OR BEFORE THE DATE OF A CTUAL POSSESSION OR REGISTRATION OF THE SALE DEED FOR SUCH A PROPERTY. (IV) ASSESSEE HAS CLAIMED AND IT HAS ALSO BEEN MENTIONED IN THE AFFIDAVIT OF SHRI ZORAWAR SINGH THAT THIS AGREEMENT COULD NOT BE MATURED AND AMOUNTS WERE RETURNED TO SHRI ZO RAWAR SINGH BUT NEITHER THE ASSESSEE BROUGHT ON RECORD THE SOURCES AND EVIDENCES OF REPAYMENT NOR SHRI ZORAWAR SINGH MAINTAINED IN HIS AFFIDAVIT HOW HE RECEIVED BACK HIS PAYMENT AND THEN UTILIZED IT.'(SIC) 11. THE ASSESSEE CHALLENGED THE ADDITION BEFORE THE LEARNED CIT (APPEALS) AND IT WAS SUBMITTED THAT THE ASSESSING OFFICER HAD SIMPLY TURNED DOWN THE EVIDEN CE BY TREATING THE ENTIRE TRANSACTION AS ACCOMMODATORY IN NATURE AND THE AFFIDAVIT OF SHRI JORAWAR SINGH SHOU LD HAVE NOT BEEN REJECTED. THE LEARNED CIT (APPEALS) CONSIDERING THE EXPLANATION OF THE ASSESSEE CONFIRM ED THE ADDITION. HIS FINDINGS IN PARA 4.3 OF THE IMPUGNE D ORDER ARE REPRODUCED AS UNDER :- 8 4.3 I HAVE CONSIDERED THE SUBMISSION OF THE LD. COUNSE L. I HAVE GONE THROUGH THE NARRATIONS IN THE BANK ACCOUNT OF TH E APPELLANT IN RESPECT OF THE IMPUGNED CASH DEPOSITS, TOTALING RS, 16,00,000/-. 1 HAVE ALSO GONE THROUGH THE AFFIDAVIT OF SH. JORAWAR SINGH AND THE IMPUGNED 'AGREEMENT TO SELL', RS. 3,00,000/- WA S PAID IN CASH ON 04.06.2009, WHEREAS AS PER THE BANK ACCOUNT, THI S DEPOSIT IS BY WAY OF CLEARANCE OF SOME INSTRUMENT. AS PER T HE AFFIDAVIT OF SH. JORAWAR SINGH, THE AMOUNT OF RS. 10,50,000/- WAS PAID ON 11.06.2009 AND RS. 2,50,000/- ON 30.06.2009, BUT THE MODE OF PAYMENT HAS NOT BEEN MENTIONED IN THE AFFIDAVIT . MOREOVER, THE APPELLANT HAD RECEIVED RS.2,50,000/- ON 30.06.2009 WHEREAS 'THE DEPOSIT OF RS.2,40,000/- WA S 29.06.2009 AND SO THIS DEPOSIT REMAINS UNEXPLAINED, A S IT WAS MADE BEFORE THE DATE OF RECEIPT OF RS. 2,50,000/-. IT HAS BEEN CONTENDED BY THE APPELLANT AND SUPPORTED BY THE AFF IDAVIT OF SH. JORAWAR SINGH THAT THE DEAL DID NOT MATERIALISE AND THE APPELLANT HAD REPAID THE AMOUNT OF 16,00,000/-, BUT THE SOURC E OF THIS REPAYMENT HAS NOT BEEN EXPLAINED BY THE APPELLANT AN D IS NOT REFLECTED IN THE BANK ACCOUNT ALSO. THE LD. COUNS EL HAS MERELY SUBMITTED IN THE APPELLATE PROCEEDINGS THAT THE AFF IDAVIT OF SH. JORAWAR SINGH SHOULD NOT HAVE BEEN OUTRIGHTLY REJEC TED, BUT THIS CONTENTION OF THE LD. COUNSEL CANNOT BE ACCEPTED, S INCE THE ASSESSING OFFICER HAS MADE THE ADDITION AFT ER DULY ANALYSING THE 'AGREEMENT TO SELL' AND THE AFF IDAVIT OF SH. JORAWAR SINGH IN THE ASSESSMENT ORDER. THE EXPLANATION FOR THE IMPUGNED DEPOSIT OF RS. 16,00,000/- WAS AN AFTE RTHOUGHT AND HAS RIGHTLY BEEN REJECTED BY THE ASSESSING OFFI CER. THE ADDITION MADE IS ACCORDINGLY CONFIRMED. GROUND OF AP PEAL NO. 3 IS DISMISSED. 12. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND MATERIAL ON RECORD. THE LEARNED COUNSEL FOR THE A SSESSEE REITERATED THE SUBMISSIONS MADE BEFORE THE AUTHORIT IES 9 BELOW AND REFERRED TO THE AGREEMENT TO SELL AND A FFIDAVIT OF SHRI JORAWAR SINGH. ON THE OTHER HAND, THE LEA RNED D.R. FOR THE REVENUE RELIED UPON THE ORDERS OF THE AUTHORITIES BELOW. THE ASSESSING OFFICER NOTED TH AT THERE IS INHERENT CONTRADICTION REGARDING RECEIPT OF RS.3 LACS ON 4.6.2009 AS PER ALLEGED AGREEMENT TO SELL, WHEREA S THE BANK DEPOSITS OF RS.3 LACS ON THAT DATE ARE ON ACCO UNT OF CLEARANCE OF SOME INSTRUMENT AND NOT ON ACCOUNT OF CASH AS CLAIMED BY THE ASSESSEE. THE COPY OF THE BANK A CCOUNT IS FILED ON RECORD WITH RESPECT TO THE FINDINGS OF THE ASSESSING OFFICER. THEREFORE, THE DEPOSIT OF RS.3 LACS ON 4.6.2009 IS NOT AT ALL EXPLAINED BY THE ASSESSEE. THE ASSESSEE FILED AFFIDAVIT OF SHRI JORAWAR SINGH, IN WHICH HE HAS CLAIMED TO HAVE GIVEN RS.2,50,000/- TO THE ASSE SSEE ON 30.6.2009. BUT THE BANK ACCOUNT OF THE ASSESSE E REVEALED THAT RS.2,40,000/- WERE DEPOSITED ON 29.6. 2009. THE AMOUNT IS DIFFERENT AS PER AFFIDAVIT OF SHRI JO RAWAR SINGH AND EVEN THE CASH DEPOSIT IN THE BANK ACCOUNT WAS PRIOR TO THE CASH GIVEN BY SHRI JORAWAR SINGH. THIS CONTRADICTION HAS NOT BEEN EXPLAINED BY THE ASSESSE E AT ALL. FURTHER NO DOCUMENTARY EVIDENCE HAD BEEN PRO DUCED TO PROVE THE CREDITWORTHINESS OF THE PURCHASER AND THE GENUINENESS OF THE TRANSACTION IN THE MATTER. THE REFORE, THE SOURCE OF RECEIPT OF CASH OF RS.16 LACS IS NOT PROVED. THE PURCHASER WAS ALSO NOT PRODUCED BEFORE THE ASSE SSING OFFICER FOR EXAMINATION OF THE AFFIDAVIT OF SHRI JO RAWAR SINGH. THE MODE OF PAYMENT HAS NOT BEEN MENTIONED . THE ASSESSEE FURTHER CLAIMED THAT SINCE THE TRANSAC TION 10 WAS NOT MATERIALIZED AS PER THE AGREEMENT, THEREFOR E, THE AMOUNT WAS REPAID BUT NO EVIDENCE WAS PRODUCED ON RECORD OF THE SOURCE OF REPAYMENT. THE ASSESSING OFFICER FOUND THAT AS PER THE AGREEMENT TO SELL, THE HOUS E WAS ON LEASE IN THE NAME OF THE DECEASED FATHER OF THE ASSESSEE. THEREFORE, THE ASSESSEE ALONE AFTER HIS DEATH WAS NOT COMPETENT TO SELL THE HOUSE OR TO RECEIVE T HE ENTIRE CONSIDERATION. THIS POINT IS NOT CLARIFIED . THE TOTALITY OF THE FACTS AND CIRCUMSTANCES CLEARLY PRO VE THAT THE ASSESSEE FAILED TO PROVE THE SOURCE OF CASH AMO UNT IN THE BANK ACCOUNT OF THE ASSESSEE. THE DECISIONS O F THE HON'BLE SUPREME COURT IN THE CASES OF DURGA PRASAD MORE AND SUMATI DAYAL (SUPRA) SQUARELY APPLY TO THE FACT S AND CIRCUMSTANCES OF THE CASE. CONSIDERING THE ABOVE DECISIONS, THE APPEAL OF THE ASSESSEE ON THIS ISSUE ALSO FAILS AND IS DISMISSED. 13. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 20 TH DAY OF NOVEMBER, 2014. SD/- SD/- (T.R.SOOD) (BHAVNESH SAINI) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 20 TH NOVEMBER, 2014 *RATI* COPY TO: THE APPELLANT/THE RESPONDENT/THE CIT(A)/TH E CIT/THE DR. ASSISTANT REGISTRAR, ITAT, CHANDIGARH 11