Appeal Details
Counselvise Citation
[2013] 121 COUNSELVISE.COM (IT) 9588 (ITAT-AHMEDABAD)
Assessee PAN
Bench
Appeal Number
CRN Number
Duration Of Justice
3 year(s) 9 month(s) 2 day(s)
Appellant
Respondent
Appeal Type
Income Tax (Search & Seizure) Appeal
Pronouncement Date
11-10-2013
Appeal Filed By
Department
Order Result
Dismissed
Bench Allotted
C
Next Hearing Date
07-08-2013
Assessment Year
2007-2008
Appeal Filed On
08-01-2010
Judgement Text
IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD C BENCH AHMADABAD BEFORE SHRI MUKUL KR. SHRAWAT , JUDICIAL MEMBER AND SHRI T.R. MEENA, ACCOUNTANT MEMBER IT(SS)A NO. 24/AHD/2010 ASSESSMENT YEAR :2007-08 ACIT, CENTRAL CIRCLE 1(3), ROOM NO. 304, 3 RD FLOOR, AAYKAR BHAVAN, ASHRAM ROAD, AHMEDABAD. V/S . SHRI HARESHBHAI RAVJIBHAI VASANI 25, KRISHNANAGAR SOCIETY, OPP. NARAN CHAMBERS, T.B. NAGAR AHMEDABAD. PAN NO. AA KPV9716K (APPELLANT) .. (RESPONDENT) BY APPELLANT SHRI D. S. KALYAN, CIT.D.R. /BY RESPONDENT SHRI S. N. SOPARKAR, A.R. /DATE OF HEARING 07.08.2013 /DATE OF PRONOUNCEMENT 11.10.2013 O R D E R PER : SHRI T.R.MEENA, ACCOUNTANT MEMBER THIS IS AN APPEAL AT THE BEHEST OF THE REVENUE WHIC H HAS EMANATED FROM THE ORDER OF CIT(A)-I, AHMEDABAD, DATED 12.11. 2009 FOR A.Y. 2007-08. THE EFFECTIVE GROUNDS OF APPEAL ARE AS UNDER: 1. THE LD. CIT(A) HAS ERRED IN LAW AND ON FACTS IN DELETING THE ADDITION MADE ON ACCOUNT OF DISALLOWANCE OF UNACCOU NTED CASH OF RS.1,00,000/-. 2. THE LD. CIT(A) HAS ERRED IN LAW AND ON FACTS IN DELETING THE ADDITION MADE ON ACCOUNT OF DISALLOWANCE OF UNACCOU NTED INVESTMENT U/S. 69B(LAND AT NARODA) OF RS.29,00,000 /-. IT(SS)A NO. 24/AHD/10 A.Y. 07-08 PAGE 2 3. THE LD. CIT(A) HAS ERRED IN LAW AND ON FACTS IN DELETING THE ADDITION MADE ON ACCOUNT OF DISALLOWANCE OF UNACCOU NTED INVESTMENT U/S. 69B(LAND AT CHANDKHEDA) OF RS.30,50 ,000/- 2. THE FIRST GROUND OF APPEAL IS AGAINST DELETING T HE ADDITION ON ACCOUNT OF UNEXPLAINED CASH OF RS.1,00,000/-. THE A.O. OBSERV ED THAT DURING THE COURSE OF SEARCH AND SEIZURE OPERATION FROM THE RESIDENCE OF THE ASSESSEES BEDROOM, CASH OF RS. 1,18,250/- WAS FOUND AND OUT O F THIS, RS.1,00,000/- WAS SEIZED. THE A.O. GAVE REASONABLE OPPORTUNITY OF BE ING HEARD TO EXPLAIN THE SOURCE OF CASH, WHICH WAS REPLIED BY THE ASSESSEE. THE ASSESSEE CLAIMED BEFORE THE A.O. THAT THIS WAS THE CASH KEPT AT RESI DENCE AS THE ASSESSEE EITHER A PARTNER OR DIRECTOR OR HAVING OTHER BUSINE SS ACTIVITIES. HE ALSO REFERRED THE STATEMENT RECORDED ON 11.05.2006 DURI NG THE COURSE OF SEARCH IN Q. NOS. 11 & 19 AND ADMITTED THAT THIS CASH BELONG ED TO THEIR DISCLOSED SOURCE OF INCOME. THE LD. A.O. WAS NOT SATISFIED W ITH THE EXPLANATION GIVEN BY THE ASSESSEE BECAUSE OF THE WHOLE GROUP HAS MADE DI SCLOSURE OF RS.92.26 LACS AS UNACCOUNTED INCOME WHICH INCLUDES UNDISCLOS ED CASH OF RS.12.5 LACS, WHICH HAS BEEN DISCLOSED IN CASE OF M/S. SHRI HARI ASSOCIATES, WHERE THE ASSESSEE WAS PARTNER. THE A.O. HELD THAT THIS WAS CONCOCTED STOREY JUST TO EXPLAIN THE UNACCOUNTED CASH FOUND DURING THE COURS E OF SEARCH AND SEIZURE AND NO NEXUS BETWEEN CASH FOUND AT RESIDENCE AND TH E BOOKS OF ACCOUNT WAS ESTABLISHED BY THE ASSESSEE AND UNEXPLAINED DISCLOS URE OF RS.12.5 LACS ARRIVED ON THE BASIS OF BOOKS OF ACCOUNT OF M/S. SH RI HARI ASSOCIATES. THUS, HE MADE ADDITION OF RS.1,00,000/- AS UNEXPLAINED CA SH. IT(SS)A NO. 24/AHD/10 A.Y. 07-08 PAGE 3 3. THE ASSESSEE CARRIED THE MATTER BEFORE THE CIT(A ) WHO HAD DELETED THE ADDITION BY OBSERVING AS UNDER: 10. I HAVE CAREFULLY CONSIDERED THE ASSESSMENT ORD ER AND THE ABOVE SUBMISSIONS. IT IS SEEN THAT DURING THE COUR SE OF SEARCH, TOTAL CASH AMOUNT OF RS.19.78 LACS WAS FOUND FROM THE VARIOUS PREMISES, OUT OF WHICH RS.17 LACS WAS SEIZED. IT IS NOTICED THAT AS AGAINST THIS CASH AS PER BOOKS OF DIFFERENT ENTITIES OF GROUP IS OF RS.23,27,710/- . ACCORDINGLY, HAVING REGARD TO THIS FACT, THE ADDITI ON MADE OF RS.1.00 LAC IN THE CASE OF APPELLANT IS UNJUSTIFIED AND IS DELETED . 4. NOW THE REVENUE IS BEFORE US. LD. CIT D.R. VEHE MENTLY RELIED UPON THE ORDER OF THE A.O. AT THE OUTSET, LD. COUNSEL F OR THE APPELLANT SUPPORTED THE ORDER OF THE CIT(A). 5. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE MATERIAL ON RECORD. THE APPELLANT HAD INCOME FROM VARIOUS FIRM S AS SHOWN IN THE COMPUTATION OF INCOME AT PAGE NO.81 OF PAPER BOOK. DURING THE COURSE OF SEARCH, STATEMENT RECORDED U/S. 132(4) OF THE IT AC T ON 11.05.2006, HE ADMITTED IN Q.NO.11 AS WELL AS IN Q.NO. 19. THAT T HIS CASH BELONGED TO PARTNERSHIP FIRMS. THIS GROUP HAS ALREADY DISCLOSE D RS.12.5 LACS ON ACCOUNT OF UNDISCLOSED CASH. THEREFORE, THIS HAS BEEN CONS IDERED AT THE TIME OF DISCLOSURE BY THE APPELLANT ON THE BASIS OF CASH AV AILABLE IN THE BOOKS OF ACCOUNT AND CASH FOUND DURING THE COURSE OF SEARCH. THUS, WE DO NOT INTERVENE IN THE ORDER OF THE CIT(A). ACCORDINGLY, ON THIS GROUND, THE REVENUES APPEAL IS DISMISSED. IT(SS)A NO. 24/AHD/10 A.Y. 07-08 PAGE 4 6. THE SECOND GROUND OF APPEAL IS AGAINST DISALLOWA NCE OF UNACCOUNTED INVESTMENT U/S. 69B IN LAND AT NARODA OF RS.29 LACS . THE A.O. OBSERVED THAT DURING THE COURSE OF SEARCH AT THE RESIDENCE PREMIS ES OF THE ASSESSEE, LOOSE PAPER WAS FOUND, WHICH WAS INVENTORISED AS PER ANNE XURE A-1 PAGE 136 WHICH ENUMERATED THE CASH PAYMENTS MADE BY THE ASSE SSEE FOR THE LAND AT SURVEY NO.954 AT NARODA. THE SAID LAND IS IN THE N AME OF THE ASSESSEE AND RS.29 LACS HAVE BEEN PAID AS A LAST INSTALLMENT. T HIS IS CLEAR FROM THE TEXT OF THE VOUCHER RECEIPT WHERE IT HAD BEEN WRITTEN THAT THE SAID MONEY HAS BEEN PAID AS LAST INSTALLMENT ON 04.04.2006. THE AMOUNT IN CASH HAD BEEN PAID TO SURESH CHOTABHAI AND OTHERS FOR THE PLOT OF LAND AT NARODA. THE SAID DEAL WAS PUT ACROSS TO THE ASSESSEE DURING THE STATEMENT RECORDED U/S. 132(4) ON 10.04.2006. IT WAS EXPLAINED BY HIM THAT HE WOULD GO THROUGH THE BOOKS OF ACCOUNTS AND FIND OUT WHETHER THE TRANSACTION WAS R EFLECTED IN THE BOOKS OF ACCOUNT OR NOT. IT WAS ALSO CONTENDED THAT THE PAY MENT OF RS.5 LACS WAS MADE BY CHEQUE AND THE SAME WAS PART OF THE ABOVE L AST INSTALLMENT. THE SAID NAME I.E. SURESH CHOTABHAI WAS ALSO MENTIONED IN PERSONAL DIARY OF THE ASSESSEE, WHEREIN FIGURES 435 + 12 TITLE FEE ARE WR ITTEN. TWO ENTRY RECORDS HAVE BEEN SEIZED AND INVENTORIZED AT PAGE NOS. 39 A ND 41 OF THE ANNEXURE A- 1, WHICH ARE THE TRUE COPIES TAKEN OUT FROM THE SUB REGISTRAR OFFICE, AHMADABAD-6, NARODA, WHEREIN THE TRANSFER OF THE AB OVE SURVEY NUMBER 954 AT NARODA HAD BEEN DETAILED. THE MONIES OF RS.29 L ACS WERE PAID TO THE SELLERS ON 04.04.2006 AND THE OWNERSHIP RIGHTS WERE TRANSFERRED ON 07.04.2006. THE LD. A.O. FURTHER HELD THAT THIS AM PLY DEMONSTRATES THAT ALL THE IT(SS)A NO. 24/AHD/10 A.Y. 07-08 PAGE 5 PAYMENTS HAD BEEN MADE BY THE ASSESSEE GROUP TO ACQ UIRE THE LAND. BUT THIS FINAL INSTALLMENT DOES NOT GIVE ANY PICTURE TO INCL UDE CASH AND CHEQUE PAYMENT. THE A.O. GAVE REASONABLE OPPORTUNITY OF B EING HEARD ON THIS ISSUE, WHICH WAS RESPONDED BY THE ASSESSEE. IT WAS ADMITT ED BY THE ASSESSEE BEFORE THE A.O. THAT CASH PAYMENTS HAD BEEN OFFERED AS INCOME FOR THE A.Y. 07-08 AND PAID THE TAX ACCORDINGLY. THE LD. A.O. D ERIVED CONCLUSION THAT ASSESSEE MUST HAVE PAID MORE INSTALLMENT TO ACQUIRE THIS PROPERTY ON THE BASIS OF NOMENCLATURE GIVEN IN THE SEIZED MATERIAL. THE BALANCE SHEET OF THE ASSESSEE SHOWED RS. 34 LACS INVESTED IN THE SAID LA ND. THE A.O. WAS NOT SATISFIED WITH THE EXPLANATION THAT ONE INSTALLMENT WAS RS. 5 LACS AND ANOTHER WAS RS.29 LACS AS INSTALLMENT ALWAYS TO BE EQUAL AM OUNT. THUS, HE MADE ADDITION OF RS.29,00,000/- AS UNACCOUNTED INVESTMEN T U/S. 69B OF THE IT ACT. 7. THE ASSESSEE CARRIED THE MATTER BEFORE THE CIT(A ) WHO HAD DELETED THE ADDITION BY OBSERVING AS UNDER: 10. I HAVE CONSIDERED THE ASSESSMENT ORDER AND THE ABOVE SUBMISSIONS. IT IS SEEN THAT SEIZED PAPER REFERS T O PAYMENT OF RS.29 LACS AS LAST INSTALLMENT AND THAT THE AMOUNT IS ALR EADY REFLECTED IN THE APPELLANTS RETURN/ACCOUNTS. THERE IS NO OTHER DOCUMENT OR EVIDENCE TO SHOW THAT THE ASSESSEE HAS PAID ANY FUR THER AMOUNT IN CASH. THERE IS ALSO NO OTHER JUSTIFICATION FOR PRE SUMING THAT THE APPELLANT MUST HAVE PAID ANOTHER AMOUNT OF RS.29 LA CS IN CASH. THE ASSESSING OFFICER HAS NOT CARRIED OUT ANY INQUI RY WITH OTHER PARTY OF THE TRANSACTION TO FIND OUT THE FACTS AND HAS SIMPLY REJECTED THE EXPLANATION. CONSIDERING THE FACTS OF THE CASE , I AM OF THE VIEW THAT THERE IS NO JUSTIFICATION FOR PRESUMPTION THAT THE ASSESSEE HAS IT(SS)A NO. 24/AHD/10 A.Y. 07-08 PAGE 6 MADE PAYMENT ONE MORE INSTALLMENT OF RS. 29 LACS. ACCORDINGLY, THE ADDITION OF RS.29 LACS IS DIRECTED TO BE DELETE D . 8. NOW THE REVENUE IS BEFORE US. LD. CIT D.R. VEHE MENTLY RELIED UPON THE ORDER OF THE A.O. AND ARGUED THAT ON SEIZED PAP ER, THE COPY OF THAT ENCLOSED BY THE ASSESSEE AT PAGE NOS. 84 TO 87 SHOW S THAT LAST INSTALLMENT RECEIVED FOR SURVEY NO. 954, NARODA. THE INTENTION OF THE WORDING SHOWED THAT ASSESSEE HAD PAID MINIMUM ONE MORE INSTALLMENT AGAINST THE PURCHASE OF THE LAND TO SURESH CHOTABHAI AS ASSESSEE HAS PAR TLY ADMITTED RS. 29 LACS AS INCOME FOR THE CURRENT YEAR. THUS, A.O. WAS RIG HT IN MAKING ADDITION OF RS.29 LACS. AT THE OUTSET, LD. COUNSEL FOR THE AP PELLANT SUPPORTED THE ORDER OF THE CIT(A) AS NO CORROBORATIVE EVIDENCES WERE FOUND DURING THE COURSE OF SEARCH THAT THE ASSESSEE HAD MADE PAYMENT IN MORE I NSTALLMENTS BY MENTIONING IN SEIZED MATERIALS LAST INSTALLMENT, DO ES NOT GIVE ANY RIGHT TO A.O. TO MAKE ADDITION. THE ASSESSEE HAS DISCLOSED RS.29 LACS IN THE YEAR UNDER CONSIDERATION INCLUDING THE CHEQUE PAYMENT OF RS.5 LACS. HE ALSO FILED THE COPY OF BANA CHITHI IN GUJARATI VERSION AT PAGE NOS . 26 TO 54 AND PAGE NOS. 55 TO 83 OF PAPER BOOK IN ENGLISH VERSION. LD. COUNSE L HAS DRAWN OUR ATTENTION ON PAGE NOS. 70 TO 72 AND ARGUED THAT RS.5,08,796/- PAID BY THE APPELLANT AND THEIR FAMILY MEMBERS THROUGH CHEQUES IN THE MONTH O F MARCH 2006 AND WHATEVER CASH PAYMENT MADE TO THE SELLER, WHICH WAS RS.29 LACS HAS BEEN DISCLOSED IN THE CURRENT INCOME BY THE ASSESSEE. T HUS, HE PRAYED TO CONFIRM THE ORDER OF THE CIT(A). IT(SS)A NO. 24/AHD/10 A.Y. 07-08 PAGE 7 9. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE MATERIAL ON RECORD. THE NOMENCLATURE GIVEN IN THE SEIZED MATER IAL IS NOT CONCLUSIVE EVIDENCE. THE ASSESSEE HAS EXPLAINED THE ENTRIES B EFORE THE A.O. THEREAFTER, THE ONUS HAS BEEN SHIFTED ON THE REVENU E TO PROVE OTHERWISE BY MAKING NECESSARY INQUIRY OR BRINGING OUT ANY EVIDEN CE ON RECORD TO MAKE THE ADDITION WHICH HAS NOT BEEN CONTROVERTED BY THE A.O . BEFORE MAKING ANY ADDITION. THEREFORE, WE UPHOLD THE ORDER OF THE CI T(A). ON THIS GROUND, THE REVENUES APPEAL IS DISMISSED. 10. THE THIRD GROUND IS AGAINST DELETING THE ADDITI ON MADE ON ACCOUNT OF UNACCOUNTED INVESTMENT U/S. 69B LAND AT CHANDKHEDA OF RS. 30.50 LACS. THE A.O. OBSERVED THAT DURING THE COURSE OF SEARCH PROC EEDINGS, THE PAPERS SEIZED FROM THE RESIDENCE OF RAVJIBHAI POPATBHAI VA SANI AND HIS SONS, HARESHBHAI VASANI AND KIRANKUMAR VASANI, 24/25, KRI SHNA NAGAR SOCIETY, OPP. NARAN CHAMBERS, T.B. NAGAR, AHMADABAD, REVEALE D THAT THERE WERE PAPERS RELATING TO THE LAND PURCHASED AT SURVEY NO. 887/3 AT CHANDKHEDA WHICH WAS SEIZED AS PER ANNEXURE A-L PAGE 121 CONTA INS A BANA CHITHTHI BETWEEN ONE DINESH B. AGRAWAL OF SABARMATI AREA AND HARESH RAVJIBHAI VASANI. DINESH AGRAWAL HAS MADE BANA CHITHHI WITH T HE ORIGINAL OWNERS OF THE LAND I.E. SURVEY NO. 887/3 OF AREA 7183 SQ. MTRS. F OR RS. 1.10 CRS. THE SAID AMOUNT WAS TO BE PAID IN 9 MONTHS FROM THE DATE OF THE AGREEMENT. THE PAYMENTS WERE TO BE MADE IN INSTALLMENTS OF 25% EAC H AT AN INTERVAL OF 3 MONTHS. THE DOCUMENTS WERE TO BE PREPARED ON COMPLE TION OF THE PAYMENT SCHEDULE. PAYMENT OF RS.5 LACS WAS ALSO MADE AT THE TIME OF SIGNING THE SAID IT(SS)A NO. 24/AHD/10 A.Y. 07-08 PAGE 8 BANA CHITHTHI. THE BANA CHITHTHI HAS BEEN SIGNED BY BOTH THE PARTIES. HOWEVER, ON THE SAID PAGE A SUM OF RS.29.50 LACS HA S BEEN WRITTEN AS TO BE PAID AS THE FIRST INSTALLMENT. DURING THE POST SEAR CH PROCEEDINGS STATEMENT OF SHRI DINESHBHAI BADRIPRASAD AGRAWAL WAS RECORDED ON 04/09/2006, WHERE IT WAS EXPLAINED BY HIM THAT INDEED ON THE DAY OF THE SIGNING OF THE BANA CHITHTHI, A CASH OF RS.5 LACS, WAS PAID TO THE FARM ERS. FURTHER, IN THE SAME ANNEXURE, PAGE NO.138 TO 159 CONTAINS THE DETAILS OF THE PAYMENTS MADE BY THE ASSESSEE IN CASH TO THE LAND OWNERS. THE SAID V OUCHERS ARE SELF- EXPLANATORY, AS DETAILS OF THE CASH PAYMENTS MADE A RE WRITTEN ALONG WITH THE NAME OF THE RECEIVING PARTY AND THE PARTICULARS OF THE LAND. THE SAID LAND IS THE SAME AS THE ONE MENTIONED IN THE BANA CHITHTHI AS DESCRIBED ABOVE. THE DETAILS OF THE PAYMENTS TO THE FARMERS ARE AS UNDER : SEIZED PAGE NO. NAME AND ADDRESS OF THE RECIPIENT DATE OF THE VOUCHER AMOUNT IN RS. 138 SHANGARBEHN NAVALSINH VAGHELA, CHANDKHEDA. 12.03.2006 2,12,500 140 RAMSINH PRATAPSINH VAGHELA, CHANDKHEDA. 12.03.2006 4,25,000 142 BHARATSINH NAVALSINH VAGHELA, CHANDKHEDA. 12.03.2006 2,12,500 144 KESARBA KANAII VAGHELA, CHANDKHEDA. 12.03.2006 8,50,000 146 PRAKASHSINH NAVALSINH VAGHELA, CHANDKHEDA. 12.03.2006 2,12,500 148 KANAKSINH NAVALSINH VAGHELA, CHANDKHEDA. 12.03.2006 2,12,500 150 KANAKSINH PRATAPSINH VAGHELA, CHANDKHEDA. 13.03.2006 4,25,000 25,50,000 IT(SS)A NO. 24/AHD/10 A.Y. 07-08 PAGE 9 FURTHER, THE PAGE NO.5 TO 35 OF THE ANNEXURE A-I S EIZED FROM THE RESIDENCE OF ASSESSEE, CONTAINS THE TITLE CLEARANCE DEED AND THE MOU WHEREIN ANOTHER PARTY NAMED JAYESH BABULAL PATEL HA S BEEN MENTIONED. IT MAY BE MENTIONED HERE THAT THE MIDDLE-MAN DINESH AG RAWAL AND HARESHBHAI VASANI IN THEIR STATEMENTS RECORDED ON OATH INSISTE D THAT THE LAND DEAL HAS BEEN CANCELLED. THE A.O. GAVE REASONABLE OPPORTUNI TY OF BEING HEARD ON THIS ISSUE, WHICH WAS REPLIED BY THE ASSESSEE. THE ASSE SSEES REPLY SUBMITTED BEFORE THE A.O., WHICH IS REPRODUCED AS UNDER: 5.3 IN THIS CONNECTION, VIDE QUESTIONNAIRE DATED 2 1.10.2008 THE ASSESSEE WAS REQUESTED TO EXPLAIN THE ENTIRE TRANSA CTION MID- SOURCE OF INVESTMENT WITH DOCUMENTARY EVIDENCES. IN RESPONSE TO THE ABOVE, THE ASSESSEE VIDE LETTER DAT ED 12.12.2008 HAS STATED THAT THE SAMJUTI KARAR WAS MA DE FOR SALE OF LAND OF 7183 SQ. MTS. AT SURVEY NO. 887/3, CHANDKHEDA BETWEEN SHRI KARANSINGH NAVUJI AND OTHER S AND SHRI HARISHBHAI & OTHERS. FURTHER HE HAS STATED THA T WE ARE IN BUSINESS OF DEVELOPING AND CONSTRUCTION OF HOUSING PROJECT. THE DEVELOPMENT AND CONSTRUCTION OF THE PROJECTS IS CARRIED IN DIFFERENT-PARTNERSHIP FIRMS IN WHICH THE FAMILY MEM BERS ARE PARTNERS. FOR THE PURPOSE OF PROJECT, WE ARE PURCHA SING THE LAND IN THE NAME OF ONE OR MORE PARTNER AND THEN TH E SAID LAND IS TRANSFERRING IN NAME OF FIRM OR SOCIETY AS THE CASE MAY BE. IN THE ABOVE MATTER, I STATE THAT FOR PURCHASE OF ABOVE LAND. HARESHBHAI RAVJIBHAI VASANI (ASSESSEE) ENTERE D INTO SAMJUTI KARAR AND AS PER THE SAMJUTI KARAR RS. 1.02 CRORES FIXED FOR PURCHASE OF LAND AND THE AMOUNT IS PAYABL E IN FOUR EQUAL INSTALMENTS OF RS. 25.50 LACS. IN THIS MATTER , I STATE THAT IT(SS)A NO. 24/AHD/10 A.Y. 07-08 PAGE 10 AS PER BANA CHITTI ON SIGNING OF BANA CHITTI RS. 5 LACS TO BE PAID AND THE BALANCE AMOUNT LO BE PAID IN FOUR EQUA L INSTALLMENTS. IN THIS MATTER, I HAVE PAID RS. 5 LAC S ON SIGNING THE BANA CHITTI AND THEREAFTER I HAVE ALSO PAID THE FIRST INSTALMENT OF RS. 25.50 LACS TO SEVEN PERSON IN SAM JUTI KARAR. THEREAFTER, THE SAID SAMJUTI KARAR FOR PURCHASE OF ABOVE LAND WAS NOT EXECUTED AND CANCELLED AND COPY OF THE CANC ELLATION DEED DATED 6.6.2006 IS PRODUCED FOR VERIFICATION. T HE ABOVE PAYMENT IS OFFERED AS INCOME IN SHRI HARI ASSOCIATE S AND OFFERED TO TAX IN RETURN OF INCOME FILED FOR THE AS SESSMENT YEAR 2006-07. THE EXPLANATION MADE BY THE ASSESSEE WAS NOT SATISF IED THE A.O. AS THE ASSESSEE DID NOT DISCLOSE THIS AMOUNT AT THE TIME O F PAYMENT RELEVANT TO F.Y. 05-06 AND AT THE TIME OF RECEIPT BACK F.Y. 06-07. DURING THE COURSE OF SEARCH, THE ASSESSEE HAD ADMITTED PAYMENT MADE TO THE FARME R TO THE TUNE OF RS.25.5 LACS HAD BEEN DISCLOSED AS INCOME IN A.Y. 06-07, DI D NOT HAVE ANY BASIS AS LAND WAS PURCHASED IN THE NAME OF ASSESSEE AND OTHE R PERSON SHRI JAYESHBHAI BABUBHAI PATEL. FURTHER, IT WAS HELD TH AT IN CASE OF FIRM, ASSESSEE HAS DISCLOSED RS.43 LACS AS ADDITIONAL INCOME, SIMU LTANEOUSLY, HE HAD CLAIMED DEDUCTION U/S. 80IB ON SAME INCOME AND NO T AX HAD BEEN PAID FOR UNDISCLOSED INCOME. THUS, HE MADE ADDITION OF RS.3 0,50,000/- U/S. 69B OF THE IT ACT AS UNACCOUNTED INCOME. 11. THE ASSESSEE CARRIED THE MATTER BEFORE THE CIT( A) WHO HAD ALLOWED THE APPEAL BY OBSERVING AS UNDER: 17. I HAVE CONSIDERED THE ASSESSMENT ORDER AND THE ABOVE SUBMISSIONS. THE ASSESSING OFFICER HAS MADE THE ADDITION FOR THE IT(SS)A NO. 24/AHD/10 A.Y. 07-08 PAGE 11 REASON THAT AS PER THE LOOSE PAPER FOUND FROM THE A PPELLANT, LAND WAS AGREED TO BE PURCHASED IN THE NAME OF THE APPEL LANT AS PER BANA CHITTHI FOR WHICH CASH WAS PAID. THE AGREEMENT AS PER BANA CHITTHI WAS SUBSEQUENTLY CANCELLED AND NO FURTHER P AYMENT WAS MADE. THIS FACT IS NOT IN DISPUTE. THE APPELLANT HA D EXPLAINED THAT THE LAND WAS PURCHASED FOR THE BUSINESS OF THE PART NERSHIP FIRM AS THE BUSINESS WAS BEING CARRIED OUT FOR DEVELOPMENT OF LAND IN PARTNERSHIP FIRM. THE BANA CHITTHI WAS IN THE NAME OF APPELLANT AS PER THEIR PRACTICE AS HE WAS A PARTNER OF THE FIRM. THE FIRM I.E. M/S. HARI ASSOCIATES HAS MADE TOTAL DISCLOSURE OF RS.43 LACS IN THEIR RETURN OF INCOME OF A.Y.2006-07, FILED U/S.153A, WH ICH INCLUDES THE PAYMENT OF RS.30,50,000/- REFERRED TO HEREINABOVE. THE ASSESSMENT OF THE FIRM HAS ALSO BEEN MADE VIDE ORDER DATED 31. 12.2008. THUS, THE AMOUNT PAID IS CONSIDERED AS PART OF DISCLOSURE OF THE FIRM. THE ASSESSING OFFICER HAS NOT ACCEPTED THIS CONTENTION ONLY ON THE GROUND THAT IN THE FIRM M/S. HARI ASSOCIATES DEDUCT ION U/S. 80-IB WAS CLAIMED. THERE IS NO OTHER REASON FOR NOT ACCEPTING THE EXPLANATION. I FIND THAT IN THE CASE OF HARI ASSOCIATES IN THE A SSESSMENT ORDER THE FACT ABOUT DISCLOSURE WAS CONSIDERED AND CLAIM OF D EDUCTION U/S.80- IB WAS REJECTED BY THE ASSESSING OFFICER. CONSIDERI NG THE ABOVE FACT, WHEN THE IMPUGNED AMOUNT WAS DISCLOSED IN THE CASE OF FIRM, THERE IS NO JUSTIFICATION FOR MAKING ADDITION FOR T HE SAME AMOUNT IN THE HANDS OF THE APPELLANT ACCORDINGLY, THE ADDITIO N OF RS.30,50,000 IS DELETED. 12. NOW THE REVENUE IS BEFORE US. LD. CIT D.R. REL IED UPON THE ORDER OF THE A.O. AND ARGUED THAT LAND WAS IN THE NAME OF AS SESSEE AS WELL AS IN THE NAME OF ONE SHRI JAYESHBHAI BABUBHAI PATEL. SHRI J AYESHBHAI BABUBHAI PATEL HAS NO ROLE TO PLAY IN CASE OF PARTNERSHIP FI RM AS HE WAS OUTSIDER. THE IT(SS)A NO. 24/AHD/10 A.Y. 07-08 PAGE 12 LD. CIT(A) MERELY DELETED THE ADDITION THAT A.O. DI SALLOWED THE DEDUCTION U/S. 80IB IN CASE OF FIRM, NAMELY, M/S. HARI ASSOCIATES. THERE IS NO EVIDENCE TO PROVE THAT WHETHER THE ASSESSEE HAD PAID THE TAX ON ADDITION OR CHALLENGE THE ADDITION BEFORE THE HIGHER FORUM. THUS, HE PRAYED TO CONFIRM THE ADDITION MADE BY THE A.O. AT THE OUTSET, LD. COUNSEL FOR TH E APPELLANT SUPPORTED THE ORDER OF THE CIT(A) AND ARGUED THAT THIS AMOUNT HAS BEEN DISCLOSED IN A.Y. 06-07 IN CASE OF PARTNERSHIP FIRM, NAMELY, SHRI HAR I ASSOCIATES. HE ARGUED THAT ASSESSEE IS IN THE CONSTRUCTION BUSINESS WHICH WAS DONE THROUGH THE PARTNERSHIP FIRM. THE PAYMENT MADE FOR RS.25.5 LAC S WERE MADE IN A.Y. 06- 07 WHICH CANNOT BE ADDED IN A.Y. 07-08 IN CASE OF A SSESSEE. THUS, HE REQUESTED TO UPHOLD THE ORDER OF THE CIT(A). 13. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE MATERIAL ON RECORD. THE PAYMENTS MADE IN THE F.Y. 05-06 AS EVI DENT FROM THE ASSESSMENT ORDER OF THE ASSESSEE, WHICH WAS RECEIVE D BACK IN THE YEAR UNDER CONSIDERATION. THE LD. A.O. HELD THAT THIS WAS THE UNACCOUNTED INCOME BUT IT CANNOT BE TAXED ON THE BASIS OF RECEIPTS. IF ANY P AYMENT IS MADE BY THE ASSESSEE FROM UNDISCLOSED INCOME, WAS RELEVANT TO A .Y. 06-07. THEREFORE, ADDITION IN YEAR UNDER CONSIDERATION CANNOT BE MADE . ACCORDINGLY, WE CONFIRM THE ORDER OF THE CIT(A). HOWEVER, IT IS CLARIFIED THAT A.O. IS FREE TO TAKE ACTION IN A.Y. 06-07 ON THE BASIS OF PAYMENT MADE FOR PURC HASE OF ALLEGED UNACCOUNTED TRANSACTION FOR PURCHASE OF LAND. THE A.O. DISALLOWED THE 80IB DEDUCTION IN CASE OF FIRM, ON SAME INCOME, THERE IS NO MATERIAL ON RECORD IT(SS)A NO. 24/AHD/10 A.Y. 07-08 PAGE 13 TO SHOW THAT THE ASSESSEE HAS CHALLENGED THE DISALL OWANCE MADE U/S. 80IB IN CASE OF FIRM, NAMELY, M/S. SHRI HARI ASSOCIATES. 14. IN THE RESULT, THE REVENUES APPEAL IS DISMISSE D. THIS ORDER PRONOUNCED IN OPEN COURT ON 11.10.2013 SD/- SD/- ( MUKUL KR. SHRAWAT ) (T.R. MEENA) JUDICIAL MEMBER ACCOUNTANT MEMBER TRUE COPY S.K.SINHA ! ! ! ! '! '! '! '! / COPY OF ORDER FORWARDED TO:- 1. / APPELLANT 2. / RESPONDENT 3. '(' ) * / CONCERNED CIT 4. *- / CIT (A) 5. !./ ), ) , 12( / DR, ITAT, AHMEDABAD 6. /45 67 / GUARD FILE. BY ORDER/ , 8/ 1 ': ) , 12( ;
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