The ACIT, CENTRAL-2, Indore V. M/S. Suvidhi Realiteis Pvt. Ltd., Indore

ITSSA 148/IND/2017

• Counselvise Citation: [2021] 107 COUNSELVISE.COM (IT) 7251 (ITAT-INDORE)
• Duration Of Justice: 4 year(s) 3 month(s) 5 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 23-08-2021
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 17-05-2021
• Assessment Year: 2012-2013
• Appeal Filed On: 18-05-2017
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: S S MANTRI
• Assessee Lawyers: C P RAWKA; VENUS RAWKA ARS
• Keywords: Unexplained investment; Unexplained expenditure; Search and seizure; Loose papers; Document seized; Principle of natural justice; Opportunity of cross examination; Question of law; Retraction; Documents seized
• Section: 69C; 143(3); 142(1); 13; 132; 2

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL, INDORE BENCH, INDORE BEFORE HONBLE RAJPAL YADAV, VICE PRESIDENT AND HONBLE MANISH BORAD, ACCOUNTANT MEMBER VIRTUAL HEARING IT(SS)A NO.148/IND/2017 ASSESSMENT YEAR 2012-13 ACIT, (CENTRAL-(2) INDORE : APPELLANT V/S M/S. SUVIDHI REALITIES PVT. LTD. INDORE : RESPONDENT PAN :AAKCS5089C REVENUE BY SHRI S.S. MANTRI, CIT-DR ASSESSEE BY SHRI C.P. RAWKA, & VENUS RAWKA, ARS DATE OF HEARING 09.06.2021 DATE OF PRONOUNCEMENT 23.08.2021 O R D E R PER MANISH BORAD, A.M THE ABOVE CAPTIONED APPEAL FILED AT THE INSTANCE O F THE REVENUE FOR ASSESSMENT YEAR 2012-13 IS DIRECTED A GAINST THE ORDERS OF LD. COMMISSIONER OF INCOME TAX(APPEALS)-I II (IN SHORT LD. CIT], INDORE DATED 28.02.2017 WHICH IS ARISIN G OUT OF THE M/S. SUVIDHI REALITIES PVT. LTD. IT(SS)A NO.148/IND/2017 2 ORDER U/S 143(3) OF THE INCOME TAX ACT 1961(IN SHO RT THE ACT) DATED 31.03.2015 FRAMED BY DCIT-(CENTRAL)-1, INDORE . THE REVENUE HAS RAISED FOLLOWING GROUNDS OF APPEAL: 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE T HE LD. CIT(A) ERRED IN DELETING THE ADDITIONS OF RS.5,93,5 1,700/- MADE BY AO ON ACCOUNT OF UNEXPLAINED INVESTMENT IN PURCHASER OF LAND WITHOUT APPRECIATING THE FACTS AN D EVIDENCES BROUGHT INTO LIGHT BY THE AO DURING ASSES SMENT PROCEEDINGS. 2. THE APPELLANT IS RESERVES HIS RIGHT TO ADD, AMEN D OR ALTER THE GROUNDS OF APPEAL ON OR BEFORE THE DATE, THE AP PEAL IS FINALLY HEARD FOR DISPOSAL. 2. BRIEF FACTS OF THE CASE AS CULLED OUT FROM THE R ECORDS ARE THAT THE ASSESSEE IS A PRIVATE LIMITED COMPANY ENGAGED I N THE BUSINESS OF DEVELOPMENT AND SALE OF PLOTS. SEARCH U /S 132 OF THE ACT WAS CARRIED OUT ON 21.09.2012 AT VARIOUS PREMIS ES OF THE JHAVERI GROUP. ASSESSEE COMPANY IS ALSO PART OF JHA VERI GROUP. DURING THE SEARCH PROCEEDINGS IT WAS FOUND THAT THE JHAVERI GROUP HAD PURCHASED LANDS AT HIGHER PRICES BUT IN T HE REGISTRY, ACTUAL AMOUNT PAID BY THEM WAS NOT DECLARED. LD. AS SESSING OFFICER ALSO OBSERVED THAT DURING THE YEAR UNDER AP PEAL ASSESSEE PURCHASED LANDS AT RAU AND VALUE AS PER REGISTRY WA S AT RS.4,42,91,300/- BUT THE GUIDELINE VALUE WAS AT RS. 10,36,43,000/-. THE DIFFERENCE WORKED OUT TO RS. 5, 93,51,700/-. M/S. SUVIDHI REALITIES PVT. LTD. IT(SS)A NO.148/IND/2017 3 WHEN CONFRONTED THE ASSESSEE SUBMITTED THAT NO ON MONEY OVER AND ABOVE THE VALUE APPEARING IN THE REGISTERED SAL E DEED HAS BEEN PAID AND ALSO THERE IS NO PROVISIONS IN THE ST ATUTE TO TREAT THE GUIDELINE VALUE AS ACTUAL CONSIDERATION AND TAX THE DIFFERENCE IT IN THE HANDS OF THE PURCHASER. LD. ASSESSING OFF ICER HOWEVER WAS NOT CONVINCED. HE REFERRED TO VARIOUS LOOSE PAP ERS FOUND AND SEIZED FROM THE PREMISES OF SHRI MUKESH JHAVERI AND ALSO GAVE REFERENCE TO THE STATEMENT OF SOME OF THE SELLERS W HO ACCEPTED TO HAVE RECEIVED ON MONEY. BASED ON THESE DOCUMENTS, LD. ASSESSING OFFICER GAVE A GENERAL FINDING THAT THE J HAVERI GROUP HAD PURCHASED LAND AT VARIOUS PLACES IN INDORE AT H IGHER PRICES BUT IN THE REGISTERED DEED ACTUAL AMOUNT PAID BY TH EM IS NOT DISCLOSED. ACCORDINGLY, ADDITION OF RS.5,93,51,700/ - WAS MADE AND INCOME ASSESSED AT RS.5,93,47,271/-. 3. AGGRIEVED ASSESSEE PREFERRED AN APPEAL BEFORE TH E LD. CIT(A) AND SUCCEEDED, AS LD. CIT(A) DELETED THE ADDITION O N OBSERVING THAT ADDITIONS WERE MADE MERELY ON THE BASIS OF STA TEMENT OF THE SELLERS WHICH WERE NEITHER PROVIDED TO THE ASSESSEE NOR OPPORTUNITY OF CROSS EXAMINATION WAS GIVEN AND FURT HER LD. ASSESSING OFFICER HAS NOT BROUGHT ANY EVIDENCE ON R ECORD TO SHOW M/S. SUVIDHI REALITIES PVT. LTD. IT(SS)A NO.148/IND/2017 4 THAT APPELLANT HAD PAID ANY AMOUNT OVER AND ABOVE T HE AMOUNT MENTIONED IN THE SALE DEED. 4. AGGRIEVED REVENUE IS IN APPEAL BEFORE THIS TRIBU NAL. LD. DR VEHEMENTLY ARGUED REFERRING TO THE DETAILED FINDING OF THE LD. ASSESSING OFFICER INCLUDING VARIOUS DOCUMENTS REFER RED IN THE ASSESSMENT ORDER ITSELF. 5. PER CONTRA LD. COUNSEL FOR THE ASSESSEE HEAVILY RELIED ON THE FINDING OF LD. CIT(A) AND THE DECISIONS REFERRED TH EREIN AND AGAIN ASSERTED THAT NO ON MONEY WAS PAID BY THE ASSESSE E. 6. WE HAVE HEARD RIVAL CONTENTIONS AND PERUSED THE RECORDS PLACED BEFORE US. THE REVENUE IS AGGRIEVED WITH THE FINDING OF LD. CIT(A) DELETING THE ADDITION OF RS. 5,93,51,700/- MADE BY THE LD. ASSESSING OFFICER ON ACCOUNT OF UNEXPLAINED INVESTM ENT IN PURCHASE OF LAND WITHOUT APPRECIATING THE FACTS AND EVIDENCE BROUGHT INTO LIGHT BY THE LD. ASSESSING OFFICER DUR ING THE ASSESSMENT PROCEEDINGS. 7. WE NOTICE THAT THE SEARCH WAS CONDUCTED AT JHAVE RI GROUP ON 21.09.2012 U/S 132 OF THE ACT. LD. ASSESSING OFFICE R BASED ON CERTAIN LOOSE PAPERS AND INCRIMINATING MATERIAL, ST ATEMENT OF THE M/S. SUVIDHI REALITIES PVT. LTD. IT(SS)A NO.148/IND/2017 5 SELLERS WHO HAVE DEALT WITH MR. MUKESH JHAVERI HAVI NG STATED TO HAVE ACCEPTED ON MONEY MADE A GENERAL OBSERVATIO N THAT SINCE JHAVERI GROUP IS INDULGED IN PURCHASING THE LANDS A T INDORE AT HIGHER PRICES BUT THE CONSIDERATION MENTIONED IN R EGISTERED SALE DEED IS LESS TO THE ACTUAL PRICE AND THE REMAINING AMOUNT OVER AND ABOVE THE VALUE APPEARING IN THE REGISTERED DEE D IS PAID AS ON MONEY IN CASH, SIMILAR MODUS OPERANDI MUST HAVE BEEN APPLIED BY THE ASSESSEE IN PURCHASE OF 7.30 ACRE LA ND AT VILLAGE RAU. LD. ASSESSING OFFICER FURTHER IN SUPPORT TO JU STIFY THE ADDITION REFERRED TO THE GUIDELINE VALUE AND THE RE GISTRY VALUE OF THE LAND IN QUESTION WHEREIN THE GUIDELINES VALUE W AS HIGHER BY RS. 5,93,51,700/- TO THE REGISTRY VALUE. 8. WE FURTHER FIND THAT LD. CIT(A) AFTER EXAMINING THE DETAILS AND ALSO ON FINDING THAT THE STATEMENT OF THE ALLEGED S ELLERS WAS NEITHER CONFRONTED TO THE ASSESSEE NOR ANY OPPORTUN ITY OF CROSS EXAMINATION WAS GIVEN AND PLACING RELIANCE ON VARIO US SETTLED JUDICIAL PRECEDENTS DELETED THE ADDITION OBSERVING AS FOLLOWS: 3.3 I HAVE GONE THROUGH THE ASSESSMENT ORDER, THE APPELLANT'S CONTENTIONS AND THE MATERIAL ON RECORD. THE APPELLANT HAS PURCHASE LAND IN VILLAGE RAU FROM VAR IOUS SELLERS, THE DETAILS OF THE 'SAME HAVE BEEN PLACED ON RECORD. DURING THE COURSE OF THE SEARCH NO INCRIMINATING DO CUMENT OR MATERIAL WAS FOUND TO SHOW THAT THE APPELLANT HAD M ADE M/S. SUVIDHI REALITIES PVT. LTD. IT(SS)A NO.148/IND/2017 6 PAYMENT OVER AND ABOVE THE AMOUNT STATED IN THE PUR CHASE DEED FOR THE LAND AT RAU. THE ASSESSING OFFICER HAS RELIED ON SEIZED DOCUMENTS LPS M-2 PAGE NO. 21 AND LPS-L/48 P AGE NO. 141 WHICH HAS BEEN OWNED UP BY SHRI MUKESH JHAV ERI AND ABHISHEK JHAVERI AND THE ISSUE RELATING TO THIS AGREEMENT IS INCLUDED IN THE APPLICATION MADE XI] S 245C( 1) AND WHICH HAS BEEN ACCEPTED BY THE HON 'BLE SETTLEM ENT COMMISSION, DELHI VIDE ITS ORDER DATED 22/08/2016. THESE SEIZED DOCUMENTS REFERRED TO BY THE ASSESSING OFFIC ER ARE NOT PERTAINING TO THE APPELLANT AND CANNOT BE THE BASIS FOR MAKING THE ADDITION WITHOUT ANY OTHER CORROBORATIVE EVIDENCE ON RECORD. 3.4 THE ASSESSING OFFICER HAS RELIED UPON THE STATE MENT OF SHRI SANJAY SHARMA WHICH HAS BEEN MADE PART OF THE ASSESSMENT ORDER AT PARA 9.7. SHRI SANJAY SHARMA HA D STATED IN THE STATEMENT RECORDED VI] S 131 ON 21/09/2012 THAT HE ALONG WITH HIS FAMILY MEMBERS HAD SOLD LAND TO SHRI MUKESH JHAVERI. THE REGISTRY OF LAND WAS DONE AT RS . 1,11,00,000/ - WHEREAS THE ACTUAL SALE CONSIDERATIO N WAS RS. 4,75,00,000/ -. THE APPELLANT HAS NOW PLACED ON RECORD STATEMENT OF SHRI SANJAY SHARMA DULY NOTARIZED STAT ING THAT HE HAD GIVEN THE STATEMENT TO THE INCOME TAX DEPART MENT UNDER THREAT AND COERCION AND NO ON MONEY HAS BEEN RECEIVED BY HIM. HERE THE PERTINENT POINT ALSO IS T HAT THE APPELLANT DID NOT HAVE ANY TRANSACTION WITH SHRI SA NJAY SHARMA AND THE ASSESSING OFFICER DID NOT VERIFY WHE THER SUCH PERSONS DECLARED THE AFORESAID HIGHER PRICE PA ID FOR THE PURCHASE OF PROPERTY BY SHRI MUKESH JHAVERI THAN SH OWN IN THE SALE DEED IN THEIR INDIVIDUAL INCOME TAX RETURN S. 3.4.1 THE ASSESSING OFFICER HAS ALSO RELIED ON THE STATEMENT OF SHRI RAJESH SULE WHICH HAS BEEN MADE PART OF THE ASSESSMENT ORDER AT PARA 9.8.2. SHRI RAJESH SULE HA D STATED IN THE STATEMENT RECORDED IS U/ S 131 THAT HE ALONG WITH HIS FAMILY MEMBERS HAD SOLD LAND TO M/ S SUVIDHI REALIT IES PVT. LTD. FOR WHICH RS. 82.90 LACS WAS RECEIVED THROUGH CHEQUES AND RS. 90 LACS WAS RECEIVED IN CASH. THE ASSESSING OFFICER HAS ALSO MENTIONED ABOUT THE STATEMENTS RECORDED IX] S 131 OF SHRI MANAK CHAND TONKE IN PARAGRAPH 9.8.3. DURING T HE APPEAL PROCEEDINGS THE APPELLANT HAS PLACED ON RECO RD THE RETRACTION STATEMENTS OF SHRI RAJESH SULE, SHFL NAK CHAND TONKE AND SHRI LILADHAR TONKE. 3.4.2 VIDE THIS OFFICE LETTER D TED 30/01/2017 E AS SESSING OFFICER WAS INFORMED OF THE RETRACTION STATEMENTS F ILED THE APPELLANT AND HE WAS ASKED TO AGAIN EXAMINE THESE P ACCORD M/S. SUVIDHI REALITIES PVT. LTD. IT(SS)A NO.148/IND/2017 7 AN OPPORTUNITY TO THE APPELLANT TO CROSS EXAMINE. T HE ASSESSING OFFICER VIDE HIS REPORT DATED 15/02/2017 HAS SUBMITTED THAT THE ASSESSEE WAS CONFRONTED WITH THE STATEMENTS RECORDED DURING THE SEARCH AS WELL AS ASSESSMENT PROCEEDINGS AND NO RETRACTION WERE FILED AT THAT TIME. THE RETRACTION LETTERS FROM THE SELLERS FILED IN THE APPEAL PROCEEDINGS ARE NOTHING BUT AN AFTERTHOUGHT AND THE REFORE THERE IS NO REQUIREMENT FOR FURTHER EXAMINATION OF THE SELLERS. 3.4.3 THE APPELLANT VIDE ITS REPLY DATED 25/02/2014 HAD SUBMITTED IN THE ASSESSMENT PROCEEDINGS (REFERENCE PARA 9.3 OF THE ASSESSMENT ORDER) THAT THE STATEMENTS OF SHR I RAJESH SULE HAS NEVER BEEN PROVIDED TO ENABLE IT TO ANALYZ E THE SAME. THE APPELLANT HAD IN ITS SUBMISSIONS HIGHLIGH TED THE BROAD PRINCIPLES RELATING TO DEPOSITION OF A WITNES S WHICH CLEARLY STATE THAT AN OPPORTUNITY OF REBUTTAL IS GI VEN TO THE OTHER PARTY. THE ASSESSING OFFICER HAS WRITTEN IN P ARA 9.5 OF THE ASSESSMENT ORDER THAT COPIES OF ALL STATEMENTS HAD ALREADY BEEN PROVIDED ALONG WITH THE QUESTIONNAIRE ISSUED U/S 142(1) DATED 31/07/2014. PERUSAL OF THE SAID QUESTIONNAIRE DATED 31/07/2014 SHOWS THAT ONLY COPY OF THE STATEMENT GIVEN BY SHRI SANJAY SHARMA WAS GIVEN TO THE APPELLANT (REFERENCE PARA 4.1 OF THE QUESTIONNAIRE) . AS STATED IN PARA 3.4 ABOVE SHRI SANJAY SHARMA HAD NO DEALING S WITH THE APPELLANT COMPANY. THE COPIES OF THE OTHER STAT EMENTS RELIED UPON BY THE ASSESSING OFFICER HAVE NOT BEEN GIVEN TO THE APPELLANT. ALSO NO OPPORTUNITY TO CROSS EXAMINE THE SELLERS WAS GIVEN TO THE APPELLANT. 3.4.4 THE APPELLANT IN SUBMISSIONS HAS POINTED OUT THE FOLLOWING POINTS REGARDING THE STATEMENT OF SHRI RA JESH SULE WHICH HAS BEEN MADE PART OF THE ASSESSMENT ORDER:- (I) THE STATEMENT HAS BEEN RECORDED ON OATH BUT TH E NAME OF THE INCOME TAX OFFICIAL ADMINISTERING THE OATH I S NOT STATED. (II) THE STATEMENT IS NOT SIGNED BY ANY INCOME TAX OFFICIAL. (III) THERE IS NO DATE MENTIONED ON THE STATEMENT. (IV) SHRI RAJESH SULE HAS ADMITTED TO RECEIPT OF C ASH WHICH HAS BEEN DEPOSITED BY HIM IN PUNJAB NATIONAL BANK IN THE ACCOUNT IN JOINT NAME WITH HIS BROTHER SHRI SUB HASH SULE. HOWEVER, THERE IS NOTHING ON RECORD TO SHOW THAT DE PARTMENT HAS TAKEN ANY ACTION TO TAX THE SAID AMOUNT. 3.5 THE DECISION OF HON'BLE SUPREME COURT IN THE CASE OF CIT M/S. SUVIDHI REALITIES PVT. LTD. IT(SS)A NO.148/IND/2017 8 VS. P.V. ASSESSEE VIDE A REGISTERED SALE DEED PURCHASED CERTAIN LAND, FOR A SUM OF RS. 4.10 LAKHS. SUBSEQUE NT TO THE PURCHASE OF LAND, CERTAIN NOTES ON 100<::' ~ SHEETS ALLEGEDLY WRITTEN BY HIM WERE FOUND AND SEIZED BY THE REVENUE DURIN A SEARCH OPERATION. WHEN CONFRONTED, THE ASSESSEE CON TENDED THAT HE COULD NOT REMEMBER AS TO WHY THE NOTINGS HA D BEEN MADE. BUT THE VENDOR, IN HIS STATEMENTS, ADMITTED T HAT HE HAD IN FACT RECEIVED A TOTAL CONSIDERATION OF RS. 34.35 LAKHS AND THAT THE SUM OF RS. 4.10 LAKHS REFLECTED IN THE SAL E DEED HAD BEEN RECEIVED BY HIM BY WAY OF A DEMAND DRAFT AND T HE BALANCE IN CASH. SUBSEQUENTLY, VENDOR RETRACTED FRO M HIS STATEMENTS. THE ASSESSING OFFICER, HOWEVER, CONCLUD ED THAT THE SALE CONSIDERATION WAS ACTUALLY RS. 34.85 LAKHS AND NOT RS. 4.10 LAKHS AS HAD BEEN RECITED IN THE SALE DEED . HE ACCORDINGLY ADOPTED THE AFORESAID ENHANCED FIGURE F OR THE PURPOSE OF ASSESSMENT. ON APPEAL, THE COMMISSIONER (APPEALS) OBSERVING THAT THE STATEMENTS GIVEN BY TH E VENDOR COULD NOT BE RELIED UPON, DELETED THE ADDITION. AN APPEAL PREFERRED THERE AGAINST BY THE REVENUE WAS DISMISSE D BY THE TRIBUNAL. ON FURTHER APPEAL UNDER SECTION 260A, THE HIGH COURT DISMISSED THE SAME IN LIMINE BY HOLDING THAT NO SUBSTANTIAL QUESTIONS OF LAW HAD BEEN RAISED BY THE REVENUE. THE HON'BLE SUPREME COURT ALSO DID NOT FIND ANY INF IRMITY WITH THE ORDER OF THE HIGH COURT. 3.5.1 THE FOLLOWING DECISIONS OF THE HIGH COURTS AR E ALSO RELEVANT:- (I) THE DECISION OF HON'BLE HIGH COURT OF RAJASTHA N IN CIT VS. KAMAL TRADING CO. (2013) 33 TAXMANN.COM 554 (RA J.) --- IN THIS CASE ADDITION OF RS. 22,41,482/ - WAS MADE ON ACCOUNT OF UNEXPLAINED SUNDRY CREDITORS. CIT(A) FOUND THAT STATEMENTS OF CERTAIN FARMERS WERE RECORDED BY THE INSPECTOR O F INCOME TAX BUT THEY WERE RECORDED BEHIND THE BACK OF THE A SSESSEE. THE ASSESSEE WAS NOT GIVEN AN OPPORTUNITY TO CROSS EXAMINE THE WITNESSES. STATEMENTS WERE WRITTEN IN HINDI, WH ERE AS THE FARMERS WERE ILLITERATE OR SEMILITERATE. AFFIDA VITS WERE FILED BY THE ASSESSEE OF EACH AND EVERY FARMER, WHICH HAV E BEEN RELIED UPON BY THE CIT(A) TO DELETE THE ADDITION AN D THE SAID FINDING HAS BEEN AFFIRMED BY THE TRIBUNAL WHICH HAS BEEN UPHELD BY THE HIGH COURT. (II) THE DECISION OF HON 'BLE HIGH COURT OF GUJRAT IN HEIRS AND LEGAL REPRESENTATIVES OF LATE LAXMAN BHAI S. PA TEL VS. CIT (2008) 174 TAXMAN 206 (GUJRAT) --- IN THIS CASE THE STATEMENTS OF WITNESS 'R' ON WHICH HEAVY RELIANCE W AS PLACED BY THE ASSESSING OFFICER WHILE MAKING ADDITION, WAS NEITHER M/S. SUVIDHI REALITIES PVT. LTD. IT(SS)A NO.148/IND/2017 9 REFERRED TO IN ASSESSMENT ORDER NOR A COPY THEREOF WAS GIVEN TO ASSESSEE NOR ASSESSEE WAS GIVEN AN OPPORTUNITY OF CROSS-EXAMINING SAID 'R'. IT WAS HELD THAT THE ADDITIONS WERE NOT JUSTIFIED. (III) THE DECISION OF HON'BLE HIGH COURT OF DELHI I N CIT VS. ASHWINI GUPTA (2010) 322 ITR 396 (DELHI) --- IN THI S CASE IT WAS HELD THAT ONCE THERE IS A VIOLATION OF THE PRIN CIPLES OF NATURAL JUSTICE INASMUCH AS SEIZED MATERIAL IS NOT PROVIDED TO AN ASSESSEE NOR IS CROSS-EXAMINATION OF THE PERSON ON WHOSE STATEMENT THE ASSESSING OFFICER RELIES UPON, GRANTE D, THEN, SUCH DEFICIENCIES WOULD AMOUNT TO A DENIAL OF OPPOR TUNITY AND, CONSEQUENTLY, WOULD BE FATAL TO THE PROCEEDING S. 3.6 THE ASSESSING OFFICER HAS RELIED UPON THE STATE MENTS OF THE SELLERS OF PROPERTIES BUT HAS NOT VERIFIED WHET HER SUCH PERSONS HAVE DECLARED THE AFORESAID HIGHER PRICE TH AN SHOWN IN THE SALE DEED IN THEIR INDIVIDUAL INCOME TAX RET URNS. THE DECISION OF HORI'BLE KERALA HIGH COURT IN P.M. ABOO BACKER (2014) 363 ITR 447 IS RELEVANT WHERE IN IT WAS HELD AS UNDER:- THE ASSESSING OFFICER, FOR THE ASSESSMENT YEAR 2006 -07, INCLUDE RS. 54,20,000 AS UNDISCLOSED INVESTMENT OF THE ASSESSEE, THE OWNER OF A SHOPPING COMPLEX. THIS WAS BASED ON INFORMATION OBTAINED DURING SEARCH AND SEIZURE OPERATIONS AT TH E RESIDENCE OF N. N. HAD GIVEN A STATEMENT UNDER SECTION 132(4) OF THE INCOME - TAX ACT, 1961, STATING THAT HE SOLD THE PROPERTY FOR RS. 78,20,000 TO THE ASSESSEE. IN AN AFFIDAVIT, HE INDICATED THAT HE HAD PURCHASED THE PROPERTY FOR RS. 66,20,000 AND SOLD T HE PROPERTY FOR RS. 78,20,000. WHEN THE ASSESSEE SOUGHT CROSS-E XAMINATION AND N WAS SUMMONED AND A SWORN STATEMENT WAS RECORD ED, N STATED THE DETAIL ABOUT THE PURCHASE OF THE PROPERT Y FROM M FOR RS. 78,20,000. DURING THE CROSS-EXAMINATION HE DENI ED THE SUGGESTIONS MADE BY THE ASSESSEE HE HAD DECLARED THE INCOME FROM SALE OF PROPERTY AND HE HAD PAID TAX. THE COMM ISSIONER (APPEALS) DELETED THE ADDITION HOLDING THAT THE ASS ESSING OFFICER HAD MADE THE ASSESSMENT ONLY ON THE DEPOSITION OF N AND OTHER CIRCUMSTANTIAL EVIDENCE GATHERED BY HIM. THE STATEM ENT OF PAYMENTS ANNEXED TO THE DEPOSITION MADE BY N SHOWED ONLY CASH WITHDRAWALS FROM HIS BANK ACCOUNT AND IN NO WA Y HAD THEY BEEN CORRELATED TO M. THERE WAS NO ACKNOWLEDGEMENT BY M IN REGARD TO THE FACT THAT SHE HAD RECEIVED RS. 66,20, 000. IN THE ABSENCE OF ANY EVIDENCE LINKING THE PAYMENTS STATED TO BE PAID BY THE ASSESSEE, MERELY BASED ON THE STATEMENT OF N IT COULD NOT BE STATED THAT THE ASSESSEE HAD RECEIVED ADDITIONAL M/S. SUVIDHI REALITIES PVT. LTD. IT(SS)A NO.148/IND/2017 10 CONSIDERATION. HE FOUND THAT WHEN IT IS THE DUTY OF THE REVENUE TO PROVE BEYOND DOUBT THAT ADDITIONAL CONSIDERATION HA D EXCHANGED HANDS, IN THE ABSENCE OF ANY MATERIAL AND EVIDENCE, SUCH A DECISION COULD NOT BE TAKEN ON MERE ASSUMPTION OR PROBABILITIES. HENCE, HE FOUND THAT THE ASSESSING OFFICER HAD FAIL ED TO ESTABLISH THAT ADDITIONAL CONSIDERATION HAD BEEN PAID BY THE ASSESSEE. THIS WAS CONFIRMED BY THE TRIBUNAL. ON APPEAL; HELD, ALLOWING THE APPEAL, THAT THE ORAL EVIDENCE, WHICH WAS SUPPORTED BY THE SECTION 132(4) STATEMENT AND THE A FFIDAVIT OF N, WHICH WAS UNCONTROVERTED EVEN DURING THE CROSS-EXAM INATION, COULD BE TREATED AS SUFFICIENT EVIDENCE TO SHOW THAT THE PROPERTY HAD BEEN SOLD FOR RS. 78,20,000. THE COMMISSIONER ( APPEALS) HAD GONE LITTLE FURTHER AND HAD INDICATED THAT THE REVENUE HAD NOT ADDUCED ANY FURTHER EVIDENCE TO SHOW THAT N HAD PAID RS. 66,20,000 TO M FOR PURCHASING THE PROPERTY AND THE ASSESSEE HAD PAID THE DIFFERENTIAL AMOUNT TO N . APPARENTLY, THESE WERE ALL INSTANCES WHERE THE PARTIES DID NOT MAINTAIN AN Y RECORDS AND THEY DEALT IN UNDISCLOSED AMOUNTS. IF AT ALL THE ASSESSEE WANTED TO DISPROVE THE EVIDENCE GIVEN BY N, THE ASSESSEE COULD HAVE PROVED OTHERWISE BY GIVING SOME EVIDENCE TO SH OW THE MARKET VALUE OF THE LAND IN THE LOCALITY. NO SUCH E VIDENCE WAS ADDUCED BY THE ASSESSEE. THEREFORE, THIS WAS A CASE IN WHICH THE REVENUE HAD TO PROVE THE EXISTENCE OF THE FACT THAT UNDERVALUATION WAS MADE BY THE ASSESSEE AND THAT TH E ASSESSEE HAD PAID MORE AMOUNTS FOR PURCHASE OF PROPERTY AMOUNTING TO RS. 54,20,000 . WHEN THAT FACT WAS PRO VED, THE BURDEN SHIFTED TO THE ASSESSEE TO PROVE OTHERWISE. HE HAD AN OPPORTUNITY TO CROSS- EXAMINE THE WITNESS AND THERE WAS NOTHING ON RECORD TO INDICATE THAT THE WITNESS HAD SPOKEN FALSE STORY. THEREFORE, EVEN IN THE ABSENCE OF ANY OTHER MATERIAL PRODUCED BY THE REVENUE , THE UNCONTROVERTED EVIDEN CE OF N WAS IN FAVOR OF COMING TO A FINDING THAT THE ASSESSEE HAD NOT DECLARED THE ACTUAL INVESTMENT MADE FOR ACQUIRING T HE BUILDING. 3.6.1 THE HON'BLE GUJARAT HIGH COURT IN CASE OF ACI T VS. GOVIND BHAI N PATEL (2013) 33TAXMANN.COM 237, HAS H ELD THAT WITHOUT ANY CORROBORATIVE EVIDENCE NO ADDITION CAN BE MADE AS UNDER:- FROM THE ABOVE, IT COULD BE SEEN THAT PRIMARILY THE ASSESSING OFFICER HAD MADE ADDITIONS ON TWO BASIS - FIRSTLY, THAT SOME OF THE LANDS IN THE VILLAGE WERE SOLD AT A HIGHER PRIC E, AND THAT IN THE PRESENT CASE, SELLERS HAD GIVEN STATEMENTS TO THE ASSESSING OFFICER OF HAVING RECEIVED HIGHER SALE CONSIDERATIO N. BOTH THE GROUNDS WERE KNOCKED DOWN BY THE CIT [A] AND TRIBUN AL ON THE PREMISE THAT THE OTHER LANDS WERE NOT SHOWN TO BE C OMPARABLE M/S. SUVIDHI REALITIES PVT. LTD. IT(SS)A NO.148/IND/2017 11 AND THAT THE WITNESSES WERE NOT OFFERED FOR CROSS EXAMINATION. IN FACT, THE ASSESSEE HAD CONTENDED THAT THE LANDS SOUGHT TO BE COMPARED BY THE ASSESSING OFFICER WERE CONVERTED IN TO NON- AGRICULTURE, AND THEREFORE, NATURALLY FETCHED MUCH HIGHER PRICE. EQUALLY, IT IS UNDISPUTED THAT THE WITNESSES WERE NEVER ALLOWED TO BE CROSS EXAMINED. IN VIEW OF THE ABOVE BACKGROUND, WE ARE OF THE OPIN ION THAT NEITHER CIT (A) NOR THE DISCLOSED BEFORE THE ASSESSING OFFICER WAS PAID OR NOT IS ESSENTIALLY BASED ON FACTS TO BE JUDGED ON T HE BASIS OF RELEVANT MATERIAL ON RECORD. WHEN CIT [A] AND TH E TRIBUNAL BOTL: CONCURRENTLY CAME TO THE CONCLUSION THAT THERE IS N O EVIDENCE SUPPORTING THE ASSESSI -'' OFFICER'S VERSION THAT T HE ASSESSEE HAD INVESTED LARGE AMOUNT IN PURCHASE OF THE LAND, IN O UR OPINION, NO QUESTION OF LAW ARISES. 3.7 THE DECISION OF THE HON'BLE I TAT , INDORE IN T HE CASE OF M/S SHREE PARSHWANATH DATED 18/07/2014 IS ALSO RELE VANT WHEREIN IT HAS BEEN HELD THAT THE MERE FACT THAT SO MEBODY MADE STATEMENT, BY ITSELF, CANNOT BE TREATED AS HAV ING RESULTED IN AN IR-REBUTTABLE PRESUMPTION AGAINST TH E ASSESSEE. THE BURDEN CANNOT BE DISCHARGE BY THE REV ENUE BY MERELY REFERRING TO THE STATEMENT OF THE THIRD PART Y AND SUCH STATEMENT CANNOT BE THE SOLE FOUNDATION THAT THE AS SESSEE HAS DELIBERATELY SUPPRESSED THE INCOME. 3.8 ESTIMATION OF THE ADDITIONS ON THE BASIS OF THE ASSUMPTION THAT AS THE GROUP MEMBERS INDULGE IN MAKING UNDISCL OSED CASH PAYMENTS IN LAND TRANSACTIONS, THERE IS UNDISC LOSED CONSIDERATION PAID FOR PURCHASE OF THE SAID LAND IS NOT AN ACCEPTABLE, SUSTAINABLE AND JUSTIFIED APPROACH. REL IANCE IS PLACED ON THE DECISION OF THE HON'BLE SUPREME COURT IN CASE OF K.P. VARGHESE VS. ITO & ANR. (1981) 131 ITR 597 (SC) WHEREIN THE CONTEXT OF SECTION 52 OF THE INCOME-TAX ACT, 1961 [WHICH HAS SINCE BEEN OMITTED BY THE FINANCE ACT, 1 987 W.E.F. 01/04/1988] IT HAS BEEN HELD THAT THE ONUS LIES ON THE REVENUE TO ESTABLISH THAT AN ASSESSEE HAS UNDERSTAT ED THE CONSIDERATION FOR TRANSFER OF AN IMMOVABLE PROPERTY AND UNLESS SUCH ONUS IS DISCHARGED BY THE REVENUE, THER E CANNOT BE ANY PRESUMPTION AS REGARD TO THE UNDERSTATEMENT. 3.9 FROM THE DISCUSSION IN THE PRECEDING PARAGRAPHS IT IS CLEAR THAT ADDITION HAS BEEN MADE ON THE BASIS OF T HE STATEMENTS OF THE SELLERS OF THE LAND WHICH HAVE NE ITHER BEEN PROVIDED TO THE APPELLANT NOR OPPORTUNITY OF CROSS EXAMINING THE SELLERS GIVING TO THE APPELLANT. THE ASSESSING OFFICER HAS NOT BROUGHT ANY EVIDENCE ON RECORD TO SHOW THAT THE APPELLANT M/S. SUVIDHI REALITIES PVT. LTD. IT(SS)A NO.148/IND/2017 12 HAD PAID ANY AMOUNT OVER AND ABOVE THE AMOUNT MENTI ONED IN THE SALES DEED. 4. THE ASSESSING OFFICER DURING THE ASSESSMENT PROC EEDING HAD GIVEN A SHOW CAUSE NOTICE DATED 31/07/2014 IN W HICH IT WAS PROPOSED TO ADD THE DIFFERENCE BETWEEN THE GUID ELINE VALUE AND THE PURCHASE PRICE MENTIONED IN THE PURCH ASE DEED AS UNDISCLOSED INVESTMENT XX] S 69C (PARA 9.2 OF THE ASSESSMENT ORDER). FOR MAKING AN ADDITION IX] S 69C THE REQUIREMENT IS THAT THE ASSESSEE SHOULD HAVE INCURR ED EXPENDITURE, OFFERS NO EXPLANATION ABOUT THE SOURCE OF SUCH EXPENDITURE AND THE EXPLANATION OFFERED BY HIM IS N OT SATISFACTORY IN THE OPINION OF THE ASSESSING OFFICE R. SECTION 69C CAN BE INVOKED ONLY WHEN THERE IS EVIDENCE OF UNEXPLAINED EXPENDITURE. 4.1 IN THE FINAL DISCUSSION THE ASSESSING OFFICER H AS MADE THE ADDITION ON ACCOUNT OF UNDISCLOSED RECEIPTS. THE AP PELLANT'S REAL ESTATE PROJECT IS STILL IN PROGRESS AND NO LAN D HAD BEEN SOLD FOR THE PERIOD UNDER CONSIDERATION AND CLEARLY THIS IS NOT A CASE OF UNDISCLOSED RECEIPTS. 4.2 FOR THE ASSESSMENT YEAR UNDER CONSIDERATION THE RE WAS NO STATUTE IN THE INCOME TAX ACT FOR TAXING THE PUR CHASE CONSIDERATION PAID BY ASSESSEE IF IT IS LESS THAN T HE GUIDELINE VALUE. 5. IN VIEW OF THE ABOVE IT IS HELD THAT ADDITIONS O F RS. 5,93,51,700/ - IN A.Y. 2012-13 AND RS. 1,52,69,000/ - IN A.Y. 2013-14 RESPECTIVELY MADE ON ACCOUNT OF ALLEGED UND ISCLOSED INVESTMENT FOR PURCHASE OF LAND ON ACCOUNT OF THE P URCHASE CONSIDERATION PAID BEING LESS THAN THE GUIDELINE VA LUE CANNOT BE SUSTAINED. GROUND NOS. 1 TO 8 ARE ALLOWED. 9. THE ABOVE FINDING OF LD. CIT(A) STANDS UNCONTROV ERTED BY THE LD. DR AS NO OTHER CONTRARY MATERIAL IN SUPPORT OF REVENUE HAS BEEN FILED. WE, THEREFORE, IN THE GIVEN FACTS AND C IRCUMSTANCES OF THE CASE AND RESPECTFULLY FOLLOWING THE DECISIONS R EFERRED BY THE LD. CIT(A) WHICH ARE SQUARELY APPLICABLE ON THE FAC TS OF THE INSTANT CASE, FIND NO INFIRMITY IN THE FINDING OF L D. CIT(A) AND THE M/S. SUVIDHI REALITIES PVT. LTD. IT(SS)A NO.148/IND/2017 13 SAME IS CONFIRMED. WE ACCORDINGLY DECIDE AGAINST TH E REVENUE AND DISMISS THE SOLE GROUND NO.1 RAISED IN THIS APP EAL. GROUND NO.2 IS GENERAL IN NATURE WHICH NEEDS NO ADJUDICATI ON. 10. IN THE RESULT, REVENUES APPEAL IN IT(SS)ANO.148/IND/2017 IS DISMISSED. THE ORDER PRONOUNCED AS PER RULE 34 OF ITAT RULES, 1963 ON 23.08.2021. SD/- SD/- (RAJPAL YADAV) (MANISH BORAD) VICE PRESIDENT ACCOUNTANT ME MBER / DATED : 23.08. 2021 PATEL/PS COPY TO: THE APPELLANT/RESPONDENT/CIT CONCERNED/CIT (A) CONCERNED/ DR, ITAT, INDORE/GUARD FILE. BY ORDER, ASSTT.REGISTRAR, I.T.A.T., INDORE