Smt. S.Santhanalakshmi, Thanjavur V. ACIT, CHENNAI

ITSSA 8/CHNY/2008

• Counselvise Citation: [2017] 122 COUNSELVISE.COM (IT) 2875 (ITAT-CHENNAI)
• Duration Of Justice: 8 year(s) 11 month(s) 19 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 13-01-2017
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: C
• Next Hearing Date: 17-11-2016
• Assessment Year: misc
• Appeal Filed On: 24-01-2008
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Assessee Lawyers: K G RAGHUNATH
• Keywords: Gift; Cost of acquisition
• Section: 132

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH, CHENNAI . . . , ! .#$#%, ' !( BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI ABRAHAM P. GEORGE, ACCOUNTANT MEMBER I.T.(SS) A. NO.8/MDS/2008 BLOCK PERIOD : 01.04.1986 TO 31.03.1996 & 01.04.1 996 TO 24.09.1996 SMT. S. SANTHANALAKSHMI, NO.15, MUNICIPAL COLONY MAIN ROAD, TANJORE 613 007. PAN : AABPL 7076 J V. THE ASSISTANT COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE II(2), CHENNAI. (*+/ APPELLANT) (-.*+/ RESPONDENT) *+ / 0 / APPELLANT BY : SHRI K.G. RAGHUNATH, ADVOCATE -.*+ / 0 / RESPONDENT BY : SHRI T.R. SENTHIL KUMAR, SR. ST ANDING COUNSEL 1 / 2' / DATE OF HEARING : 17.11.2016 345 / 2' / DATE OF PRONOUNCEMENT : 13.01.2017 / O R D E R PER N.R.S. GANESAN, JUDICIAL MEMBER: THIS APPEAL OF THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE ASSESSING OFFICER DATED 14.12.2007 AND PERTAINS TO BLOCK PERIOD 1.4.1986 TO 31.03.1996 AND BROKEN PERIOD 01.04.1996 TO 24.9.1996. 2. SHRI K.G. RAGHUNATH, THE LD.COUNSEL FOR THE ASSE SSEE, SUBMITTED THAT THE FIRST ISSUE ARISES FOR CONSIDERA TION IS WITH REGARD 2 I.T.(SS) A. NO.8/MDS/08 TO JURISDICTION TO PASS ASSESSMENT ORDER UNDER SECT ION 158BD OF THE INCOME-TAX ACT, 1961 (IN SHORT 'THE ACT'). ACCORDI NG TO THE LD. COUNSEL, THE ASSESSING OFFICER HAS NOT RECORDED HIS SATISFACTION FOR FRAMING ASSESSMENT UNDER SECTION 158BD OF THE ACT. REFERRING TO THE ASSESSMENT ORDER, THE LD.COUNSEL SUBMITTED THAT THERE WAS A SEARCH OPERATION UNDER SECTION 132 OF THE ACT ON 24 .09.1996 IN THE CASE OF SHRI T.V. SUNDARAVADANAM. ACCORDING TO THE LD. COUNSEL, SHRI T.V. SUNDARAVADANAM IS NONE OTHER THAN THE HUS BAND OF THE ASSESSEE. THEREFORE, THE ASSESSEE IS A PERSON OTHE R THAN THE SEARCHED PERSON. HENCE, FOR FRAMING ASSESSMENT UND ER SECTION 158BD OF THE ACT, THE ASSESSING OFFICER HAS TO RECO RD HIS SATISFACTION BEFORE ISSUING NOTICE TO THE ASSESSEE. IN THIS CASE, NO SUCH SATISFACTION WAS RECORDED, THEREFORE, ACCORDIN G TO THE LD. COUNSEL, THE ENTIRE ASSESSMENT FRAMED AGAINST THE A SSESSEE CANNOT STAND IN THE EYE OF LAW. 3. ON THE CONTRARY, SHRI T.R. SENTHIL KUMAR, THE LD . SR. STANDING COUNSEL, SUBMITTED THAT THE VERY SAME ISSU E WAS RAISED BEFORE THIS TRIBUNAL. BY AN ORDER DATED 30.06.2006 IN I.T.(SS) A. NO.174/MDS/1998, THIS TRIBUNAL CONFIRMED THE JURISD ICTION OF THE ASSESSING OFFICER TO FRAME THE ASSESSMENT. HOWEVER , ON MERIT, THE 3 I.T.(SS) A. NO.8/MDS/08 MATTER WAS REMANDED BACK TO THE FILE OF THE ASSESSI NG OFFICER, THEREFORE, THE JURISDICTION TO PASS THE ASSESSMENT ORDER UNDER SECTION 158BD OF THE ACT HAS ALREADY BEEN DECIDED B Y A CO- ORDINATE BENCH OF THIS TRIBUNAL. THEREFORE, ACCORD ING TO THE LD. SR. STANDING COUNSEL, IT CANNOT BE RE-AGITATED AGAIN. 4. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EITH ER SIDE AND PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. IT IS NOT IN DISPUTE THAT THIS IS A SECOND ROUND OF LITIGATION B EFORE THIS TRIBUNAL. IN THE EARLIER ROUND OF LITIGATION, BY AN ORDER DAT ED 30.06.2006 IN I.T.(SS) A. NO.174/MDS/1998, THIS TRIBUNAL EXAMINED THE JURISDICTION OF ASSESSING OFFICER FOR FRAMING THE ASSESSMENT UND ER SECTION 158BD OF THE ACT AND FOUND THAT THE ASSESSING OFFIC ER HAS RIGHTLY FRAMED THE ASSESSMENT. HOWEVER, THE MATTER WAS REM ITTED BACK TO THE FILE OF THE ASSESSING OFFICER FOR RECONSIDERATI ON. SINCE THE CO- ORDINATE BENCH OF THIS TRIBUNAL HAS ALREADY FOUND T HAT THE ASSESSMENT WAS RIGHTLY FRAMED AGAINST THE ASSESSEE UNDER SECTION 158BD OF THE ACT, THIS TRIBUNAL DO NOT FIND ANY REA SON TO RE-AGITATE THE MATTER ONCE AGAIN. THEREFORE, THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT THE ASSESSING OFFICER HAS RIGHTLY FRAM ED THE ASSESSMENT UNDER SECTION 158BD OF THE ACT. 4 I.T.(SS) A. NO.8/MDS/08 5. NOW COMING TO MERIT OF THE CASE, THE FIRST ISSUE ARISES FOR CONSIDERATION IS WITH REGARD TO ADDITION OF ` 2,00,000/- TOWARDS DEPOSITS MADE WITH SAKTHI ENTERPRISES AND EAST TANJ ORE TRADERS FOR ASSESSMENT YEAR 1992-93. 6. SHRI K.G. RAGHUNATH, THE LD.COUNSEL FOR THE ASSE SSEE, SUBMITTED THAT THESE DEPOSITS WERE MADE BY THE ASSE SSEES MOTHER- IN-LAW IN THE NAME OF THE ASSESSEE. THE ASSESSEE H AS FILED CONFIRMATION LETTERS FROM SHRI V. DIVAKARAN AND SHR I T.V. SUNDARAVADANAM TO ESTABLISH THAT THE DEPOSITS WERE MADE BY SMT. V. KRISHNAVENI, THE ASSESSEES MOTHER-IN-LAW IN THE YEAR 1991-92. THE ASSESSING OFFICER, HOWEVER, REJECTED THE CLAIM OF THE ASSESSEE ON THE GROUND THAT THE CREDIT IN THE BOOKS SHOWS DE POSITS FROM 17.02.1992 TO 28.05.1992. ACCORDING TO THE LD. COU NSEL, MERELY BECAUSE THE DEPOSITS WERE MADE IN TWO DIFFERENT ASS ESSMENT YEARS BETWEEN JANUARY, 1992 TO MAY, 1992, THAT CANNOT BE A REASON TO REJECT THE CLAIM OF THE ASSESSEE. SINCE SMT. V. KR ISHNAVENI, THE MOTHER-IN-LAW OF THE ASSESSEE IS NO MORE, THE CONFI RMATION LETTERS WERE FILED BY THE CLOSE FAMILY MEMBERS WHO KNOW THE TRANSACTION. THEREFORE, ACCORDING TO THE LD. COUNSEL, THE ASSESS ING OFFICER IS NOT JUSTIFIED IN DISALLOWING THE CLAIM OF THE ASSESSEE. 5 I.T.(SS) A. NO.8/MDS/08 7. ON THE CONTRARY, SHRI T.R. SENTHIL KUMAR, THE LD . SR. STANDING COUNSEL FOR THE REVENUE, SUBMITTED THAT TH E ASSESSEE CLAIMED BEFORE THE ASSESSING OFFICER THAT THE DEPOS ITS WERE MADE BY HER MOTHER-IN-LAW SMT. V. KRISHNAVENI IN HER NAM E. WHEN THE ASSESSING OFFICER ASKED FOR EVIDENCE, THE ASSESSEE WAS ABLE TO FURNISH ONLY SELF-SERVING CONFIRMATION LETTERS FROM SHRI V. DIVAKARAN AND SHRI T.V. SUNDARAVADANAM, WHEREIN IT WAS STATED THAT THE ASSESSEES MOTHER-IN-LAW DEPOSITED MONEY IN THE YEA R 1991-92. HOWEVER, IN THE BOOKS SEIZED BY THE REVENUE, THE DE POSITS WERE MADE FROM 17.02.1992 TO 28.05.1992. THEREFORE, THE RE WAS APPARENT CONTRADICTION BETWEEN THE CONFIRMATION LET TERS AND THE BOOKS OF ACCOUNT. MOREOVER, NO GIFT-TAX RETURN WAS FILED. IN THE ABSENCE OF ANY OTHER EVIDENCE, ACCORDING TO THE LD. SR. STANDING COUNSEL, THE ASSESSING OFFICER MADE AN ADDITION OF ` 2,00,000/-. 8. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EITH ER SIDE AND PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. THE BOOKS OF SAKTHI ENTERPRISES AND EAST TANJORE TRADERS DISCLOS E THE DEPOSITS OF ` 2,00,000/- IN THE NAME OF THE ASSESSEE. THE ASSESS EE EXPLAINED BEFORE THE ASSESSING OFFICER THAT THE DEP OSITS WERE MADE BY HER MOTHER-IN-LAW SMT. V. KRISHNAVENI IN HER NAM E. ADMITTEDLY, 6 I.T.(SS) A. NO.8/MDS/08 THE SAID SMT. KRISHNAVENI IS NO MORE AND THE CLOSE RELATIVE SHRI T.V. SUNDARAVADANAM, THE SON OF SMT. V. KRISHNAVENI AND THE HUSBAND OF THE ASSESSEE, FILED A CONFIRMATION LETTER DISCLO SING THAT THE DEPOSITS WERE MADE BY SMT. V. KRISHNAVENI IN THE NA ME OF THE ASSESSEE. IT APPEARS THAT SHRI V. DIVAKARAN HAS AL SO FILED A SUPPORTING LETTER. THESE LETTERS OF SHRI V. DIVAKA RAN AND SHRI T.V. SUNDARAVADANAM WERE REJECTED BY THE ASSESSING OFFIC ER ON THE GROUND THAT THESE ARE ALL SELF-SERVING CONFIRMATION LETTERS. THE FACT REMAINS THAT SMT. V. KRISHNAVENI IS NO MORE, THEREF ORE, EXPECTING THE ASSESSEE TO PRODUCE CONFIRMATION LETTER FROM SM T. V. KRISHNAVENI IS AN IMPOSSIBLE ONE. THE FACT CAN BE CLARIFIED ONLY BY A NEAREST RELATIVE WHO KNOWS THE TRANSACTION. IT I S NOT IN DISPUTE THAT SHRI V. DIVAKARAN AND SHRI T.V. SUNDARAVADANAM ARE THE FAMILY MEMBERS OF THE ASSESSEE AND HAVE A KNOWLEDGE ABOUT THE FACT OF DEPOSIT OF FUNDS IN THE NAME OF THE ASSESSE E. THEREFORE, THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT UNLESS T HE ASSESSING OFFICER EXAMINES SHRI T.V. SUNDARAVADANAM AND SHRI V. DIVAKARAN TO ESTABLISH THAT NO SUCH DEPOSITS WERE MADE IN THE NAME OF THE ASSESSEE, THIS TRIBUNAL IS OF THE CONSIDERED OPINIO N THAT REJECTING THE CLAIM OF THE ASSESSEE IS NOT JUSTIFIED. 7 I.T.(SS) A. NO.8/MDS/08 9. IN THE NORMAL CIRCUMSTANCES, THIS TRIBUNAL WOULD HAVE REMITTED BACK THE MATTER TO THE FILE OF THE ASSESSI NG OFFICER FOR RECONSIDERATION. IN THE CASE BEFORE US, THE BLOCK PERIOD INVOLVED IS 1986-1996 AND IT IS SECOND ROUND OF LITIGATION. TH EREFORE, REMANDING THE MATTER TO THE FILE OF THE ASSESSING O FFICER FOR EXAMINATION OF SHRI T.V. SUNDARAVADANAM AND SHRI V. DIVAKARAN MAY NOT SERVE ANY PURPOSE AT ALL. THEREFORE, THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT WHEN THE CONFIRMATION LETTE RS FILED BY SHRI V. DIVAKARAN AND SHRI T.V. SUNDARAVADANAM ESTABLISH TH AT THE DEPOSITS WERE MADE BY SMT. V. KRISHNAVENI IN THE NA ME OF THE ASSESSEE, THE SAME CANNOT BE SO EASILY BRUSHED ASID E. IN THE ABSENCE OF ANY OTHER MATERIAL OTHER THAN THE CONFIR MATION LETTERS, THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT THE ADDITION MADE IN THE HANDS OF THE ASSESSEE IS NOT JUSTIFIED. ACCORD INGLY, THE ORDER OF THE ASSESSING OFFICER IS SET ASIDE AND THE ADDITION OF ` 2,00,000/- MADE TOWARDS DEPOSITS IN SAKTHI ENTERPRISES AND EAS T TANJOR TRADERS IS DELETED. 10. THE NEXT GROUND OF APPEAL IS WITH REGARD TO ADD ITION OF ` 2,50,000/- TOWARDS INVESTMENT IN MARUTI 1000 CAR FO R THE ASSESSMENT YEAR 1995-96. 8 I.T.(SS) A. NO.8/MDS/08 11. SHRI K.G. RAGHUNATH, THE LD.COUNSEL FOR THE ASS ESSEE, SUBMITTED THAT THE ASSESSEE EXPLAINED BEFORE THE AS SESSING OFFICER THAT THE SOURCE FOR MAKING INVESTMENT IS THAT THE A SSESSEE HAS TRANSFERRED A CHARGE CREATED BY HER FATHER IN FAVOU R OF HIS BROTHER WHO, IN TURN, GAVE MARUTI 1000 CAR TO THE ASSESSEE IN LIEU OF TRANSFER OF CHARGE ON THE IMMOVABLE PROPERTY. THE ASSESSEES BROTHER SHRI T.R. MAHALINGAM HAS CONFIRMED THE TRAN SACTION BY A LETTER DATED 24.09.1998. THE ASSESSING OFFICER IGN ORED THE CONFIRMATION LETTER FILED BY THE ASSESSEE AND MADE ADDITION. THE LD.COUNSEL FURTHER SUBMITTED THAT SINCE NO OTHER EV IDENCE IS AVAILABLE, THE ASSESSING OFFICER OUGHT NOT TO HAVE REJECTED THE CLAIM OF THE ASSESSEE. 12. ON THE CONTRARY, SHRI T.R. SENTHIL KUMAR, THE L D. SR. STANDING COUNSEL FOR THE REVENUE, SUBMITTED THAT TH E ASSESSING OFFICER CALLED FOR THE COPIES OF DOCUMENT BY WHICH CHARGE WAS CREATED IN FAVOUR OF THE ASSESSEE. HOWEVER, THE AS SESSEE HAS NOT PRODUCED THE COPIES. WHAT WAS FILED BY THE ASSESSE E IS ONLY CONFIRMATION LETTER FROM HER BROTHER SHRI T.R. MAHA LINGAM ON 24.09.1998. IN THE SAID CONFIRMATION, IT WAS CLARI FIED THAT THERE WAS CHARGE CREATED BY HIS FATHER IN FAVOUR OF THE ASSES SEE. HOWEVER, 9 I.T.(SS) A. NO.8/MDS/08 THERE WAS NO REFERENCE ABOUT THE GIVING OF CAR TO T HE ASSESSEE BY THE ABOVE SAID SHRI T.R. MAHALINGAM. IN THE ABSENC E OF ANY OTHER MATERIAL, THE ASSESSING OFFICER MADE ADDITION OF ` 2,50,000/-. 13. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EIT HER SIDE AND PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. FROM THE ASSESSMENT ORDER, IT APPEARS THE MARUTI 1000 CAR WA S VALUED AT ` 2,50,000/-. THE SAID CAR WAS SOLD IN THE IMMEDIATE NEXT YEAR FOR ` 2,25,000/-. THE ASSESSING OFFICER DISALLOWED THE CL AIM OF THE ASSESSEE ON THE GROUND THAT THE COPIES OF DOCUMENTS WERE NOT FILED BEFORE HIM. THE ASSESSEE CLAIMS THAT HER FATHER CR EATED A CHARGE OVER THE PROPERTY, WHICH WAS SAID TO BE RELEASED IN FAVOUR OF HIS BROTHER SHRI T.R. MAHALINGAM. THE SAID FACT WAS CO NFIRMED BY A LETTER DATED 24.09.1998 BY SHRI T.R. MAHALINGAM. T HE ASSESSING OFFICER FURTHER OBSERVED THAT THERE WAS A THATCHED HOUSE IN THENNAGUDI VILLAGE ON WHICH THE CHARGE WAS CREATED BY HER FATHER IN FAVOUR OF THE ASSESSEE. WHEN A CHARGE WAS CREAT ED IN FAVOUR OF THE ASSESSEE BY HER FATHER, WHICH WAS CONFIRMED BY THE ASSESSEES BROTHER SHRI T.R. MAHALINGAM, THIS TRIBUNAL IS OF T HE CONSIDERED OPINION THAT WHEN THE PROPERTY AND THE MARUTI CAR W ERE VALUED EQUALLY, THE CLAIM OF THE ASSESSEE THAT THE CHARGE WAS RELEASED IN 10 I.T.(SS) A. NO.8/MDS/08 FAVOUR OF THE ASSESSEES BROTHER IN LIEU OF MARUTI CAR CANNOT BE IGNORED BY THE ASSESSING OFFICER. SHRI T.R. MAHALI NGAM OUGHT TO HAVE BEEN EXAMINED BY THE ASSESSING OFFICER TO FIND OUT THE NATURE OF TRANSACTION BY THE ASSESSEE AND HER BROTHER SHRI T.R. MAHALINGAM. THE ASSESSING OFFICER HAS NOT EXAMINED SHRI T.R. MAHALINGAM, THEREFORE, THIS TRIBUNAL DO NOT FIND AN Y REASON TO DOUBT THE GENUINENESS OF THE CONFIRMATION LETTER FILED BY SHRI T.R. MAHALINGAM. HENCE, THE ADDITION OF ` 2,50,000/- MADE BY THE ASSESSING OFFICER FOR THE BLOCK PERIOD IS NOT JUSTI FIED. ACCORDINGLY, THE ORDER OF THE ASSESSING OFFICER IS SET ASIDE AND THE ADDITION OF ` 2,50,000/- IS DELETED. 14. NOW COMING TO ASSESSMENT YEAR 1994-95, THE ASSE SSING OFFICER MADE ADDITION OF ` 24,575/- AS UNDISCLOSED INCOME. 15. SHRI K.G. RAGHUNATH, THE LD.COUNSEL FOR THE ASS ESSEE, SUBMITTED THAT THE ASSESSEE OWNED 3.33 ACRES OF AGR ICULTURAL LAND. THE STATE AGRICULTURE DEPARTMENT CONFIRMED THAT THE SAID LAND WAS SUBJECTED TO CULTIVATION. THE AGRICULTURAL INCOME FOR THE ASSESSMENT YEAR 1994-95 WAS ` 70,000/-. THIS WAS USED FOR PURCHASING PLOTS AT SHARDHA NAGAR, TANJORE. THE ASSESSEE WAS REGULARLY RETURNING AGRICULTURAL INCOME RIGHT FROM THE ASSESSMENT YEAR 1997-98. 11 I.T.(SS) A. NO.8/MDS/08 THEREFORE, IT IS NOT JUSTIFIED IN MAKING ANY ADDITI ON OF ` 24,575/- FOR MAKING INVESTMENT IN PLOTS AT SHARDHA NAGAR. 16. ON THE CONTRARY, SHRI T.R. SENTHIL KUMAR, THE L D. SR. STANDING COUNSEL FOR THE REVENUE, SUBMITTED THAT TH OUGH THE ASSESSEE OWNED SOME AGRICULTURAL LAND, THERE IS NO EVIDENCE TO INDICATE THAT THE ASSESSEE HAD CULTIVATED THE ABOVE SAID LAND. IN THE ABSENCE OF ANY EVIDENCE FOR CULTIVATION, IT CAN NOT BE SAID THAT THE ASSESSEE WAS RECEIVING AGRICULTURAL INCOME. TH E ASSESSING OFFICER, AFTER CONSIDERING THE INVESTMENT MADE BY T HE ASSESSEE TO THE EXTENT OF ` 41,775/- AND ANOTHER INVESTMENT TO THE EXTENT OF ` 15,800/- TOWARDS AGRICULTURAL LAND, ESTIMATED THE A GRICULTURAL INCOME AT ` 33,000/- AND THE DIFFERENCE OF ` 24,575/- WAS TREATED AS UNDISCLOSED INCOME FOR THE ASSESSMENT YEAR 1994-95. 17. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EIT HER SIDE AND PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. THE ASSESSEE HAS MADE AN INVESTMENT TO THE EXTENT OF ` 57,575/- TOWARDS THE PLOTS AT SHARDHA NAGAR, TANJORE AND IN AGRICULTURAL LANDS . THE ASSESSING OFFICER, AFTER CONSIDERING THE CLAIM OF THE ASSESSE E TOWARDS SOURCE OF INCOME, ESTIMATED THE AGRICULTURAL INCOME AT ` 33,000/- AND THE BALANCE OF ` 24,575/- WAS TREATED AS UNDISCLOSED INCOME FOR THE 12 I.T.(SS) A. NO.8/MDS/08 BLOCK PERIOD. THE FACT THAT THE ASSESSEE OWNED 3.3 3 ACRES OF AGRICULTURAL LAND AND THE SAME WAS CULTIVATED IS NO T IN DISPUTE. PROBABLY, THERE MAY BE A LITTLE DIFFERENCE IN RESPE CT OF THE YIELD SAID TO BE OBTAINED FROM THE CULTIVATION. THE FACT REMA INS THAT IN THE ABSENCE OF ANY OTHER EVIDENCE, WHEN THE MATERIAL AV AILABLE ON RECORD SUGGESTS THAT THE ASSESSEE CULTIVATED THE LA ND AND THE ASSESSEE WAS RETURNING THE AGRICULTURAL INCOME RIGH T FROM THE ASSESSMENT YEAR 1998-99, THIS TRIBUNAL IS OF THE CO NSIDERED OPINION THAT RESTRICTING THE AGRICULTURAL INCOME TO ` 33,000/- IS NOT JUSTIFIED. ACCORDINGLY, THE ORDER OF THE ASSESSING OFFICER IS SET ASIDE AND THE ADDITION OF ` 24,575/- IS DELETED. 18. NOW COMING TO ASSESSMENT YEAR 1996-97, THE ISSU E ARISES FOR CONSIDERATION IS WITH REGARD TO AN ADDITION OF ` 75,000/- TOWARDS BANK DEPOSITS. 19. SHRI K.G. RAGHUNATH, THE LD.COUNSEL FOR THE ASS ESSEE, SUBMITTED THAT THE ASSESSING OFFICER FOUND THAT THE ASSESSEE HAS DEPOSITED A SUM OF ` 50,000/- ON 08.08.1995 AND ANOTHER SUM OF ` 75,000/- ON 23.09.1995 BY CASH. THE ASSESSEE EXPLA INED BEFORE THE ASSESSING OFFICER THAT THE ABOVE DEPOSITS WERE MADE OUT OF ` 1,00,000/- OBTAINED FROM M/S SAKTHI TRADERS AND M/S EAST TANJORE 13 I.T.(SS) A. NO.8/MDS/08 TRADERS. AFTER CONSIDERING THE WITHDRAWAL OF ` 50,000/- FROM NEELANGARAI BRANCH OF INDIAN BANK ON 05.08.1995, TH E ASSESSING OFFICER FOUND THAT THERE WAS SOURCE FOR MAKING DEPO SIT OF ` 50,000/- ON 08.08.1995. ACCORDING TO THE LD. COUNSEL, IN FA CT, THE SUM OF ` 50,000/- WITHDRAWN ON 05.08.1995 WAS DEPOSITED ON 2 3.09.1995 TOGETHER WITH ANOTHER SUM OF ` 25,000/-. IN OTHER WORDS, THE SUM OF ` 75,000/- DEPOSITED ON 23.09.1995 WAS FROM THE AMOUN T WITHDRAWN TO THE EXTENT OF ` 50,000/- FROM NEELANGARAI BRANCH OF INDIAN BANK. THEREFORE, ACCORDING TO THE LD. COUNSEL, THE ASSESS ING OFFICER IS NOT JUSTIFIED IN MAKING THE ADDITION. 20. ON THE CONTRARY, SHRI T.R. SENTHIL KUMAR, THE L D. SR. STANDING COUNSEL FOR THE REVENUE, SUBMITTED THAT ON 05.08.1995, THE ASSESSEE WITHDREW A SUM OF ` 50,000/- FROM INDIAN BANK, NEELANGARAI BRANCH. THIS WAS SHOWN AS DRAWINGS FOR THE ASSESSMENT YEAR 1995-96 FROM M/S SAKTHI TRADERS. I N FACT, NO SUCH DRAWINGS WERE AVAILABLE FROM M/S EAST TANJORE TRADE RS. THEREFORE, THE ASSESSING OFFICER HAS RIGHTLY FOUND THAT ONLY ` 50,000/- WAS AVAILABLE WITH THE ASSESSEE FOR MAKING DEPOSIT IN T HE BANK ON 08.08.1995 AND FOR DEPOSITING ` 75,000/- ON 23.09.1995, NO SOURCE WAS AVAILABLE. THEREFORE, ACCORDING TO THE LD. SR. STANDING 14 I.T.(SS) A. NO.8/MDS/08 COUNSEL, THE ASSESSING OFFICER HAS RIGHTLY MADE ADD ITION OF ` 75,000/-. 21. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EIT HER SIDE AND PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. IN FACT, THE ASSESSEE DEPOSITED A SUM OF ` 50,000/- ON 08.08.1995 AND ANOTHER SUM OF ` 75,000/- ON 23.09.1995. THE ASSESSING OFFICER FOUN D THAT THERE WAS SOURCE FOR MAKING DEPOSIT OF ` 50,000/- ON 08.08.1995. HOWEVER, HE FOUND THAT THERE WAS NO SOURCE FOR MAKI NG DEPOSIT OF ` 75,000/- ON 23.09.1995. THE FACT REMAINS THAT THE ASSESSEE HAD AGRICULTURAL INCOME FROM CULTIVATION AND ALSO CASH FROM SALE OF JEWELLERY TO THE EXTENT OF ` 1,87,200/-. FROM THE ORDER OF THE ASSESSING OFFICER IT APPEARS THAT THE ASSESSEE HAS ALSO RECEIVED DIVIDEND FROM M/S SAKTHI TRADERS AND M/S EAST TANJO RE TRADERS. THEREFORE, THIS TRIBUNAL IS OF THE CONSIDERED OPINI ON THAT THE ASSESSEE MIGHT HAVE USED THE AGRICULTURAL INCOME AS WELL AS THE DIVIDEND INCOME RECEIVED FROM M/S SAKTHI TRADERS AN D M/S EAST TANJORE TRADERS FOR MAKING DEPOSIT OF ` 75,000/- ON 23.09.1995. THE ASSESSING OFFICER FOUND THAT THERE WERE DRAWING S FOR THE ASSESSMENT YEAR 1995-96 IN M/S SAKTHI TRADERS. IT IS ALSO A FACT THAT THE ASSESSEE HAD WITHDRAWN A SUM OF ` 50,000/- ON 05.08.1995 15 I.T.(SS) A. NO.8/MDS/08 FROM INDIAN BANK, NEELANGARAI BRANCH. TAKING INTO CONSIDERATION OF ALL THE FACTS AVAILABLE ON RECORD, THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT THE ASSESSEE HAD SUFFICIENT SOURCE FOR MAKING DEPOSIT OF ` 75,000/- ON 23.09.1995, THEREFORE, THE ASSESSING OF FICER IS NOT JUSTIFIED IN MAKING ADDITION OF ` 75,000/- FOR ASSESSMENT YEAR 1996- 97. 22. NOW COMING TO ASSESSMENT YEAR 1997-98, THE FIRS T ISSUE ARISES FOR CONSIDERATION IS WITH REGARD TO COST OF CONSTRUCTION ON AGRICULTURAL LANDS TO THE EXTENT OF ` 7,05,740/-. 23. SHRI K.G. RAGHUNATH, THE LD.COUNSEL FOR THE ASS ESSEE, SUBMITTED THAT THE ASSESSEE WAS NOT INVOLVED IN THE CONSTRUCTION OF ANY HOUSE. REFERRING TO PAGE 6, PARA 5.1 OF THE AS SESSMENT ORDER, THE LD.COUNSEL SUBMITTED THAT THE ENTIRE CONSTRUCTI ON ACTIVITY WAS CARRIED ON BY THE ASSESSEES HUSBAND SHRI T.V. SUND ARAVADANAM. THE ASSESSEE HAD NO SOURCE FOR MAKING INVESTMENT IN THE CONSTRUCTION SAID TO BE MADE. THE ASSESSING OFFICE R SIMPLY IGNORED THE CLAIM OF THE ASSESSEE AND PRESUMED THAT THE ASS ESSEE HAS INCURRED ` 7,05,740/- IN CONSTRUCTION OF BUILDING. 16 I.T.(SS) A. NO.8/MDS/08 24. ON THE CONTRARY, SHRI T.R. SENTHIL KUMAR, THE L D. SR. STANDING COUNSEL FOR THE REVENUE, SUBMITTED THAT TH E MATERIAL FOUND DURING THE COURSE OF SEARCH OPERATION DISCLOS ES THE EXPENDITURE INCURRED BY THE ASSESSEE TILL 02.08.199 5. SOME OF THE EXPENSES INCURRED BY THE ASSESSEE WERE FOR CONSTRUC TION OF A BUILDING AND ALSO TOWARDS BOREWELL, PVC PIPES, 10 H P MOTOR, ETC. REFERRING TO THE CLAIM OF THE ASSESSEE THAT THE BUI LDING WAS COMPLETE, THE LD. SR. STANDING COUNSEL SUBMITTED TH AT THE EXPENDITURE CLAIMED BY THE ASSESSEE CLEARLY SHOWS T HAT THE ENTIRE EXPENDITURE INCURRED FOR CONSTRUCTION OF THE BUILDI NG WAS WITHIN THE BLOCK PERIOD, THEREFORE, THE COST OF CONSTRUCTION W AS TREATED AS UNDISCLOSED INCOME FOR THE BLOCK PERIOD. 25. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EIT HER SIDE AND PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. THE SEIZED MATERIAL REFERRED BY THE ASSESSING OFFICER AT PARA 5.1 OF HIS ORDER, DISCLOSES THE EXPENDITURE OF ` 2,57,500/-. THE CLAIM OF THE ASSESSEE BEFORE THE ASSESSING OFFICER WAS THAT THE CONSTRUCT ION ACTIVITY WAS UNDERTAKEN BY HER HUSBAND SHRI T.V. SUNDARAVADANAM. THE EXPENDITURE FOR CONSTRUCTION WAS ALSO MET BY SHRI T .S. SUNDARAVADANAM. WHEN THE ASSESSEE CLAIMS THAT THE EXPENDITURE 17 I.T.(SS) A. NO.8/MDS/08 WAS INCURRED BY SHRI T.V. SUNDARAVADANAM, THIS TRIB UNAL IS OF THE CONSIDERED OPINION THAT THE ASSESSING OFFICER OUGHT TO HAVE SUMMONED THE SAID SHRI T.V. SUNDARAVADANAM AND EXAM INED HIM WITH REGARD TO COST OF CONSTRUCTION. THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT WHEN THE ASSESSEE HAS MEAGR E INCOME AND THE ASSESSING OFFICER DOUBTS THE BANK DEPOSIT MADE BY THE ASSESSEE TO THE EXTENT OF ` 75,000/-, IT IS NOT KNOWN HOW THE ASSESSING OFFICER FOUND THAT THE ASSESSEE HAD INVES TED ` 7,05,740/- IN THE ABSENCE OF ANY OTHER SOURCE OF INCOME OTHER THAN AGRICULTURAL INCOME AND SALE PROCEEDS OF GOLD JEWELLERY, THIS TR IBUNAL IS OF THE CONSIDERED OPINION THAT THE CLAIM OF THE ASSESSEE T HAT THE CONSTRUCTION ACTIVITIES WERE CARRIED ON BY THE ASSE SSEES HUSBAND CANNOT BE BRUSHED ASIDE. THE FACT REMAINS THAT MAN Y OF THE INVESTMENTS MADE BY THE ASSESSEES HUSBAND IN FAVOU R OF HIS WIFE AND CHILDREN CLEARLY SHOW THAT THE SAID SHRI T.V. S UNDARAVADANAM INVESTED IN MANY AREAS IN THE STATE. THEREFORE, TH IS TRIBUNAL IS OF THE CONSIDERED OPINION THAT THE ADDITION OF ` 7,05,740/- WAS NOT CALLED FOR. ACCORDINGLY, THE ORDER OF THE ASSESSIN G OFFICER IS SET ASIDE AND THE ADDITION OF ` 7,05,740/- IS DELETED. 18 I.T.(SS) A. NO.8/MDS/08 26. THE NEXT GROUND OF APPEAL ARISES FOR CONSIDERAT ION IS WITH REGARD TO ADDITION OF ` 7,16,448/- TOWARDS JEWELLERY. 27. SHRI K.G. RAGHUNATH, THE LD.COUNSEL FOR THE ASS ESSEE, SUBMITTED THAT BY REFERRING TO THE STATEMENT OF THE ASSESSEE, THE ASSESSING OFFICER FOUND THAT THE ASSESSEE WAS HOLDI NG GOLD JEWELLERY. THE ASSESSEE WAS MARRIED IN THE YEAR 19 69 AND HER PARENTS GAVE 100 SOVEREIGNS OF GOLD JEWELLERY AT TH E TIME OF HER MARRIAGE AS SREEDHAN PROPERTY. THE ASSESSEES SIST ER WAS ALSO MARRIED IN A COUPLE OF YEARS LATER. ACCORDING TO T HE LD. COUNSEL, THE ASSESSEE RECEIVED 75 SOVEREIGNS OF GOLD FROM HER MO THER-IN-LAW AS GIFT. THE ASSESSING OFFICER DISBELIEVED THE CLAIM OF THE ASSESSEE WITH REGARD TO RECEIPT OF 100 SOVEREIGNS OF GOLD JE WELLERY AS SREEDHAN FROM HER PARENTS AND RECEIPT OF 75 SOVEREI GNS OF GOLD JEWELLERY FROM HER MOTHER-IN-LAW. THE CONFIRMATION LETTERS FILED BY SMT. N. SASIKALA AND SMT. J. ELAVARASI ON 24.09.199 8 CONFIRMING THAT THEY HAVE WITNESSED THE GIFT GIVEN BY SMT. V. KRISHNAVENI IN MAY, 1992 WAS NOT BELIEVED BY THE ASSESSING OFFICER . THE LD.COUNSEL FURTHER SUBMITTED THAT THE ASSESSING OFF ICER VALUED THE GOLD JEWELLERY AT ` 439/- PER GRAM. SINCE THE ASSESSEE HAS RECEIVED THE GOLD JEWELLERY AS GIFTS AT THE TIME OF MARRIAGE AS SREEDHAN 19 I.T.(SS) A. NO.8/MDS/08 PROPERTY, ACCORDING TO THE LD. COUNSEL, THE NOTIONA L COST OF ACQUISITION WAS NOT APPLICABLE. 28. PLACING RELIANCE ON THE JUDGMENT OF GUJARAT HIG H COURT IN CIT V. RATAN LAL VYAPARI LAL JAIN (2011) 339 ITR 35 1AND CBDT INSTRUCTION NO.1916, THE LD.COUNSEL SUBMITTED THAT THE JEWELLERY FOR WHICH THE ASSESSEE HAS SOURCE FOR MAKING INVESTMENT STANDS EXPLAINED. REFERRING TO THE DECISION OF DELHI BENC H OF THIS TRIBUNAL IN SC VERMA V. ACIT IN I.T.A. NO.3763/DEL/2012 DATE D 18.05.2016, THE LD.COUNSEL SUBMITTED THAT THE COST OF JEWELLERY AS VALUED BY THE ASSESSING OFFICER IS NOT JUSTIFIED. THE SO-CALLED EXCESS VALUE OR EXCESS JEWELLERY OF 1632 GMS FOUND BY THE ASSESSING OFFICER WAS EXPLAINED. REFERRING TO THE WRITTEN SUBMISSION FIL ED BY THE ASSESSEE BEFORE THIS TRIBUNAL, THE LD.COUNSEL SUBMITTED THAT THE GIFT FROM MOTHER-IN-LAW WAS 100 SOVEREIGNS WHICH COMES TO NEA RLY 800 GMS. HOWEVER, THE ASSESSEE HAS CLAIMED ONLY 600 GMS BEFO RE THE ASSESSING OFFICER. GIFTS FROM RELATIVES AND CLOSE FAMILY MEMBERS ON SOCIAL OCCASIONS WERE 392 GMS. GIFT ON BIRTH OF CHILD WAS 400 GMS, GOLD JEWELLERY ACQUIRED FROM CLOSE RELATIVES W ERE 240 GMS. THE ASSESSING OFFICER AFTER CONSIDERING 1632 GMS OF JEWELLERY, FOUND THAT THEY ARE AFTERTHOUGHT. HENCE, ACCORDING TO THE LD. 20 I.T.(SS) A. NO.8/MDS/08 COUNSEL, AN ADDITION OF ` 7,16,448/- WAS MADE BEING THE VALUE OF 1632 GMS OF GOLD JEWELLERY AT THE RATE OF ` 439/- PER GRAM. 29. ON THE CONTRARY, SHRI T.R. SENTHIL KUMAR, THE L D. SR. STANDING COUNSEL FOR THE REVENUE, SUBMITTED THAT TH E ASSESSEE WAS HOLDING 2432 GMS OF GOLD JEWELLERY BEFORE THE S ALE OF 200 GMS OF JEWELLERY. THE ASSESSING OFFICER FOUND THAT THE VALUE OF GOLD JEWELLERY AS ON 31.03.1990 AS ` 6,61,504/-. THE ASSESSEE, HOWEVER, HAS NOT FILED WEALTH-TAX RETURN. THE ASSESSEE CLAI MED BEFORE THE ASSESSING OFFICER THAT SHE WAS GIVEN 100 SOVEREIGNS OF GOLD JEWELLERY AT THE TIME OF MARRIAGE AS SREEDHAN PROPE RTY. THE ASSESSEE HAS ALSO CLAIMED BEFORE THE ASSESSING OFFI CER THAT SHE RECEIVED 75 SOVEREIGNS AS GIFT FROM SMT. V. KRISHNA VENI. IN THE ABSENCE OF ANY WEALTH-TAX RETURNS FILED BY THE RESP ECTIVE PERSONS, THE ASSESSING OFFICER DISBELIEVED THE CLAIM OF THE ASSESSEE AND FOUND THAT 1632 GMS WAS EXCESS JEWELLERY. THEREFOR E, IN THE ABSENCE OF ANY MATERIAL, ACCORDING TO THE LD. SR. S TANDING COUNSEL, THE CLAIM OF THE ASSESSEE TO THE EXTENT OF SREEDHAN PROPERTY AND GIFT FROM MOTHER-IN-LAW WAS NOT ACCEPTED BY THE ASS ESSING OFFICER. 30. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EIT HER SIDE AND PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. THE ASSESSEE 21 I.T.(SS) A. NO.8/MDS/08 WAS SAID TO BE HOLDING 2432 GMS OF JEWELLERY BEFORE THE SALE OF 200 GMS OF JEWELLERY AS ON 03.01.1995. AFTER EXAMINING THE MATERIAL AVAILABLE ON RECORD, THE ASSESSING OFFICER FOUND TH AT 1632 GMS OF JEWELLERY WAS EXCESS JEWELLERY FOUND DURING THE COU RSE OF SEARCH OPERATION, THE VALUE OF WHICH IS ADDED UNDER SECTIO N 69 OF THE ACT AS UNDISCLOSED INCOME. THE ASSESSEE EXPLAINED BEFO RE THE ASSESSING OFFICER THAT 600 GMS OF GIFT WERE RECEIVE D FROM HER MOTHER-IN-LAW, GIFTS FROM RELATIVES AND HUSBAND ON FAMILY OCCASION WERE 392 GMS, GIFT ON THE OCCASION OF BIRTH OF CHIL DREN WAS 400 GMS AND THE JEWELLERY ACQUIRED FROM RELATIVES DURING MA RRIAGE WAS 240 GMS. THEREFORE, THE ASSESSEE APPEARS TO HAVE CLAIM ED BEFORE THE ASSESSING OFFICER THAT THE ENTIRE 1632 GMS OF JEWEL LERY WAS EXPLAINED BEFORE THE ASSESSING OFFICER. THE ASSESS ING OFFICER DISBELIEVED THE CLAIM OF THE ASSESSEE ON THE GROUND THAT RESPECTIVE PERSONS HAVE NOT FILED WEALTH-TAX RETURNS. THIS TR IBUNAL IS OF THE CONSIDERED OPINION THAT GIFTING GOLD JEWELLERY AS S REEDHAN BY THE RESPECTIVE PARENTS AT THE TIME OF MARRIAGE IS A CUS TOMARY PRACTICE. THE QUALITY AND QUANTITY OF GOLD JEWELLERY WOULD DE PEND UPON THE STATUS OF THE RESPECTIVE PERSONS. FROM THE MATERIA L AVAILABLE ON RECORD, IT APPEARS THAT THE ASSESSEE HAILS FROM RES PECTABLE FAMILY. THEREFORE, THE CLAIM OF THE ASSESSEE THAT SHE RECEI VED 100 22 I.T.(SS) A. NO.8/MDS/08 SOVEREIGNS OF GOLD JEWELLERY AS SREEDHAN PROPERTY F ROM HER PARENTS CANNOT BE RULED OUT. 31. EXPECTING DOCUMENTS TO BE FILED FOR RECEIPT OF SREEDHAN PROPERTY IS SOMETHING IMPOSSIBLE. IN THIS PART OF C OUNTRY, WHEN THE PARENTS GIFT GOLD JEWELLERY TO THE DAUGHTERS AT THE TIME OF MARRIAGE, THEY WILL NOT GIVE THE DOCUMENTARY EVIDENCE IN RESP ECT OF THEIR GIFT. SIMILARLY, IT IS A CUSTOMARY PRACTICE TO GIFT GOLD JEWELLERY BY MOTHER- IN-LAW AT THE TIME OF MARRIAGE. THESE FACTS HAVE T O BE TAKEN INTO CONSIDERATION WITH REFERENCE TO THE CUSTOMARY PRACT ICE PREVAILING IN THIS PART OF COUNTRY. THIS TRIBUNAL IS OF THE CONS IDERED OPINION THAT THE REVENUE AUTHORITIES CANNOT TOTALLY IGNORE THE C USTOMARY PRACTICE PREVAILING IN THIS COUNTRY. EVEN THOUGH DOWRY PROH IBITION ACT PROHIBITS DEMAND OF DOWRY DURING THE COURSE OF MARR IAGE, VOLUNTARY GIFT OF PROPERTIES SUCH AS GOLD JEWELLERY IS NO WAY PROHIBITED BY ANY OF THE LAW WHICH EXISTS IN THIS COUNTRY. EVERY PAR ENTS IRRESPECTIVE OF THEIR FAMILY BACKGROUND, SOCIAL STATUS, FINANCIAL A BILITY, MAKE AN ATTEMPT TO GIVE MAXIMUM POSSIBLE JEWELLERY TO THEIR DAUGHTERS AT THE TIME OF MARRIAGE. BY TAKING INTO CONSIDERATION THE SOCIAL STATUS OF THE ASSESSEE IN THE AREA IN WHICH SHE HAILS FROM AN D THE BACKGROUND IN WHICH THE FAMILY LIVES, THIS TRIBUNAL IS OF THE 23 I.T.(SS) A. NO.8/MDS/08 CONSIDERED OPINION THAT THE ASSESSEE WOULD HAVE REC EIVED 1632 GMS OF GOLD JEWELLERY AS CLAIMED BEFORE THE ASSESSI NG OFFICER. THEREFORE, IT CANNOT BE SAID THAT 1632 GMS OF GOLD JEWELLERY WERE EXCESSIVE. THIS TRIBUNAL IS UNABLE TO UPHOLD THE O RDER OF THE ASSESSING OFFICER AND ACCORDINGLY, THE SAME IS SET ASIDE. THE ADDITION OF ` 7,16,448/- TOWARDS UNEXPLAINED JEWELLERY IS DELETED . 32. THE NEXT GROUND OF APPEAL ARISES FOR CONSIDERAT ION IS WITH REGARD TO UNSECURED LOAN TO THE EXTENT OF ` 5,95,000/-. 33. SHRI K.G. RAGHUNATH, THE LD.COUNSEL FOR THE ASS ESSEE, SUBMITTED THAT THE ASSESSEE AVAILED UNSECURED LOAN OF ` 5,95,000/- FROM THREE PERSONS, VIZ. ` 3,00,000/- FROM SMT. VELVIZHI, ` 2,00,000/- FROM SHRI IBRAHIM AND ` 95,000/- FROM OTHERS. SMT. VELVIZHI FROM WHOM THE ASSESSEE AVAILED THE LOAN OF ` 3,00,000/-, IS NONE OTHER THAN THE ASSESSEES BROTHERS WIFE. THE LD.COUNSEL FURTHER SUBMITTED THAT WHEN THE ASSESSEE WAS IN NEED OF MON EY URGENTLY, SMT. VELVIZHI AUTHORIZED THE ASSESSEE TO AVAIL THE SALE PROCEEDS OF AGRICULTURAL PRODUCE. IN FACT, THE ASSESSEE SOLD T HE AGRICULTURAL PRODUCE WHICH BELONGED TO SMT. VELVIZHI AND REALIZE D THE SALE PROCEEDS. THE AMOUNT REALIZED ON SALE OF AGRICULTU RAL PRODUCE WAS SHOWN AS LOAN FROM SMT. VELVIZHI. THE CLAIM OF THE ASSESSEE WAS 24 I.T.(SS) A. NO.8/MDS/08 REJECTED ONLY ON THE GROUND THAT THE ASSESSEE COULD NOT PRODUCE ANY DOCUMENTARY EVIDENCE FOR SALE OF AGRICULTURAL P RODUCE. ACCORDING TO THE LD. COUNSEL, THE SALE OF AGRICULTU RAL PRODUCE IN THIS COUNTRY IS NOT REGULATED, THEREFORE, PRODUCING DOCU MENTARY EVIDENCE FOR SALE OF AGRICULTURAL PRODUCE IS IMPOSS IBLE ONE. SO LONG AS THE POSSESSION OF AGRICULTURAL PRODUCE IS NOT IN DISPUTE, THE ASSESSING OFFICER CANNOT DOUBT THE SALE OF AGRICULT URAL PRODUCE. 34. NOW COMING TO LOAN OF ` 2,00,000/- SAID TO BE RECEIVED FROM SHRI IBRAHIM, THE LD.COUNSEL FOR THE ASSESSEE SUBMI TTED THAT THE ASSESSEE AND THE ASSESSEES HUSBAND SHRI T.V. SUNDA RAVADANAM DEVELOPED THE LAND THROUGH ONE BROKER SHRI IBRAHIM. THE ASSESSEE, IN FACT, OWES ` 2,00,000/- TOWARDS DEVELOPMENT CHARGES TO BE REIMBURSED. SHRI IBRAHIM IS NO MORE, THEREFORE, TH E ASSESSEE COULD NOT PRODUCE ANY DOCUMENTARY EVIDENCE FROM SHRI IBRA HIM. REFERRING TO THE LOAN OF ` 95,000/-, THE LD.COUNSEL SUBMITTED THAT THE ASSESSEE HAS RECEIVED ` 19,000/- FROM SHRI KALYANAM, ` 15,000/- FROM SHRI E. ZARINA AND ` 18,000/- FROM SHRI P. RAJESWARAN. THE ASSESSEE HAS ALSO RECEIVED ` 15,000/- FROM MS. DHANALAKSHMI. THE RESPECTIVE PERSONS HAVE FILED CONFIRMATION LETTERS. THE ASSESSING OFFICER FOUND THAT ALL THE FOUR PERSONS WERE VERY M UCH IN EXISTENCE 25 I.T.(SS) A. NO.8/MDS/08 AND ALSO ADMITTED THAT THEY HAVE LOANED MONEY TO TH E ASSESSEE. HOWEVER, THE ASSESSING OFFICER FOUND THAT THE LOAN TRANSACTIONS WERE NOT GENUINE. ACCORDING TO THE LD. COUNSEL, WHEN THE CREDITORS ADMITTED THAT THE LOANS WERE GIVEN TO THE ASSESSEE, THE ASSESSING OFFICER CANNOT DOUBT THE LOAN TRANSACTION S. 35. ON THE CONTRARY, SHRI T.R. SENTHIL KUMAR, THE L D. SR. STANDING COUNSEL FOR THE REVENUE, SUBMITTED THAT TH E ASSESSEE CLAIMS THAT A SUM OF ` 3,00,000/- WAS REALIZED FROM SMT. VELVIZHI ON SALE OF AGRICULTURAL PRODUCE. HOWEVER, NO DOCUMENT ARY EVIDENCE WAS PRODUCED FOR SALE OF AGRICULTURAL PRODUCE, THER EFORE, THE ASSESSING OFFICER REJECTED THE CLAIM OF THE ASSESSE E. REFERRING TO THE LOAN OF ` 2,00,000/- FROM SHRI IBRAHIM, THE LD. SR. STANDING COUNSEL SUBMITTED THAT SHRI IBRAHIM WAS NO MORE AND THE ASSESSEE HAS NOT PRODUCED ANY DOCUMENTARY EVIDENCE. THEREFO RE, THE ASSESSING OFFICER RIGHTLY REJECTED THE CLAIM OF THE ASSESSEE. REFERRING TO THE LOAN OF ` 95,000/- FROM FOUR PERSONS, THE LD. SR. STANDING COUNSEL SUBMITTED THAT EVEN THOUGH ALL THE FOUR PERSONS CONFIRMED THE FACT OF LENDING LOAN TO THE ASSESSEE, THEY HAD NO RESOURCE FOR LENDING SUCH LOAN, THEREFORE, THE ASSE SSING OFFICER RIGHTLY REJECTED THE CLAIM OF THE ASSESSEE. 26 I.T.(SS) A. NO.8/MDS/08 36. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EIT HER SIDE AND PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. AS RIGHTLY SUBMITTED BY THE LD.COUNSEL FOR THE ASSESSEE, THE F ACT OF CULTIVATION OF AGRICULTURAL LAND BY SMT. VELVIZHI AND POSSESSIO N OF AGRICULTURAL PRODUCE IS NOT IN DISPUTE. THE ASSESSING OFFICER D OUBTS THE SALE OF PROCEEDS BECAUSE THERE WAS NO DOCUMENTARY EVIDENCE. IN OUR COUNTRY, THE AGRICULTURAL PRODUCES ARE SOLD IN AN U NREGULATED MARKET. WHEN THE AGRICULTURAL PRODUCES ARE SOLD IN UNREGULATED MARKET AND THERE IS NO SYSTEM OF EVIDENCING THE SAL E OF AGRICULTURAL PRODUCE IN THIS COUNTRY, THIS TRIBUNAL IS OF THE CO NSIDERED OPINION THAT REJECTING THE CLAIM OF THE ASSESSEE FOR WANT O F DOCUMENTARY EVIDENCE FOR SALE PROCEEDS IS NOT JUSTIFIED. THE A SSESSEE BEING AN INDIVIDUAL CANNOT BE EXPECTED TO MAINTAIN DOCUMENTA RY EVIDENCE FOR SALE OF AGRICULTURAL PRODUCE. 37. NOW COMING TO THE LOAN RECEIVED FROM SHRI IBRAH IM, THE FACT THAT SHRI IBRAHIM LEVELLED THE ASSESSEES LAND IS N OT IN DISPUTE. THE ASSESSEE HAD TO PAY ` 2,00,000/- TO SHRI IBRAHIM TOWARDS DEVELOPMENT OF LAND UNDERTAKEN BY HIM. MERELY BECA USE THE SAID SHRI IBRAHIM WAS NO MORE, THIS TRIBUNAL IS OF THE C ONSIDERED OPINION THAT THE CLAIM OF THE ASSESSEE CANNOT BE REJECTED. 27 I.T.(SS) A. NO.8/MDS/08 38. NOW COMING TO THE LOAN OF ` 95,000/-, THE FACT THAT THE ASSESSEE RECEIVED ` 95,000/- FROM FOUR PERSONS IS NOT IN DISPUTE. THE ASSESSING OFFICER DISBELIEVED THE CLAIM OF THE ASSESSEE THAT THE ABOVE FOUR PERSONS HAD NO SOURCE FOR LENDING TH E LOAN. WHAT WAS RECEIVED BY THE ASSESSEE IS ONLY LESS THAN ` 50,000/- FROM EACH PERSON. THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT WHEN THE ABOVE SAID FOUR PERSONS ADMITTED THE FACT OF GIVING LOAN TO THE ASSESSEE AND THE ASSESSING OFFICER ALSO FOUND THAT ALL THE FOUR PERSONS ARE VERY MUCH IN EXISTENCE, DOUBTING THE SO URCE FOR MAKING DEPOSIT IS NOT JUSTIFIED. THE LOAN AMOUNT BEING VE RY SMALL, THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT THE ASSE SSING OFFICER IS NOT JUSTIFIED IN REJECTING THE CLAIM OF THE ASSESSE E. ACCORDINGLY, THE ORDER OF THE ASSESSING OFFICER IS SET ASIDE AND THE ADDITION MADE TOWARDS UNSECURED LOAN OF ` 5,95,000/- IS DELETED. 39. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS PARTLY ALLOWED. 28 I.T.(SS) A. NO.8/MDS/08 ORDER PRONOUNCED ON 13 TH JANUARY, 2017 AT CHENNAI. SD/- SD/- ( ! .#$#% ) ( . . . ) (ABRAHAM P. GEORGE) (N.R.S. GANESAN) ' / ACCOUNTANT MEMBER /JUDICIAL MEMBER /CHENNAI, 7 /DATED, THE 13 TH JANUARY, 2017. KRI. / -289 :952 /COPY TO: 1. *+ /APPELLANT 2. -.*+ /RESPONDENT 3. 1 ;2 /CIT, CENTRAL-II, CHENNAI-34 5. 9< -2 /DR 6. =% > /GF.