KARIM TAJDIN HALANI,ANAND V. .THE ITO, WARD-1, ANAND

ITA 1113/AHD/2024

AI Insights

The case involves Karim Tajdin Halani, who appealed against the order of the CIT(A), National Faceless Appeal Centre, Delhi, which confirmed the addition of Rs.18,00,000 to his income for the Assessment Year 2016-17. This amount was alleged to be an investment in property made from undisclosed sources. The Assessing Officer had initially added this amount as undisclosed investment, which was upheld by the CIT(A). The main contention was whether the amount of Rs.18,00,000, which was part of a property transaction, was paid from undisclosed sources. The assessee argued that the payment was not made due to a dispute with the seller, a fact that was not adequately considered by the lower authorities.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 34051 (ITAT-AHMEDABAD)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-12-2024
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2016-2017
• Other Referred Cases: CIT vs Star Builders (IT Ref. No.9 of 1999, order dated 13.11.2006)
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: N. J. VYAS
• Assessee Lawyers: MEHUL THAKKAR
• Keywords: Unexplained investment

Judgement Text

"ITA No.1113/Ahd/2024 Assessment Year: 2016-17 Karim Tajdin Halani vs. ITO Page 1 of 3 IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD “SMC” BENCH, AHMEDABAD BEFORE Ms. SUCHITRA KAMBLE, JUDICIAL MEMBER ITA No.1113/Ahd/2024 Assessment Year: 2016-17 Karim Tajdin Halani, 42/43, Halani House, Bhalej Road, Shabina Park, Anand – 388 001. [PAN – AIHPH 0707 N] Vs. Income Tax Officer, Ward – 1, Anand. (Appellant) (Respondent) Assessee by Shri Mehul Thakkar, AR Revenue by Shri N.J. Vyas, Sr. DR Date of Hearing 05.12.2024 Date of Pronouncement 27.12.2024 O R D E R This appeal is filed by the assessee against order dated 27.02.2024 passed by the CIT(A), National Faceless Appeal Centre (NFAC), Delhi for the Assessment Year 2016-17. 2. The assessee has raised the following ground of appeal :- “1. The Ld. CIT(A) has erred in law and on facts in confirming the addition of Rs.18,00,000/- being an investment in property made out of undisclosed sources despite the fact that the said amount is yet to be paid by the appellant due to dispute with the sealer of the property.” 3. The assessee is an individual and filed return of income for the Assessment Year 2016-17 on 21.06.2017 declaring total income at Rs.11,47,230/-. The case of the assessee was selected for limited scrutiny through CASS to verify the issue of cash deposits in bank and transactions in property. The assessee was served show cause notice dated 14.11.2018 which was responded by the assessee thereby explaining that the assessee has purchased property at Survey No.339/2+3, sub plot ITA No.1113/Ahd/2024 Assessment Year: 2016-17 Karim Tajdin Halani vs. ITO Page 2 of 3 No.C/26, At-Vaghasi for Rs.43,00,000/-. The assessee has discharged consideration of Rs.25,00,000/- by obtaining loan from DCB Bank. As regards balance consideration of Rs.18,00,000/-, the same was not paid due to the dispute with the seller. These facts were submitted before the Assessing Officer and after taking into account the Assessing Officer made addition of Rs.18,00,000/- as investment in property made out of undisclosed sources. The Assessing Officer also made addition of Rs.11,00,000/- towards cash deposited in Karur Vaisya Bank Limited treating the same as unexplained cash. 4. Being aggrieved by the Assessment Order, the assessee filed appeal before the CIT(A). The CIT(A) partly allowed the appeal of the assessee. 5. The Ld. AR submitted that the CIT(A) was not justified in confirming the addition of Rs.18,00,000/- being investment in property made out of undisclosed sources despite the fact that the said amount was not paid by the assessee due to the dispute with the seller of the assessee. The Ld. AR further submitted that there is a delay of 21 days in filing the present appeal, as the assessee, due to personal circumstances, could not file the appeal within the time. 6. The Ld. DR submitted that the assessee is enjoying the possession but has not paid the amount as per the submission is not tenable as the assessee could not establish that there was a dispute between the parties. 7. Heard both the parties and perused all the relevant material available on record. The assessee purchased immovable property of Rs.43,00,000/- and in fact taken a home loan of Rs.25,00,000/- and balance payment of Rs.18,00,000/- was paid in subsequent year but the details of remaining Rs.18,00,000/- was not supported by any evidence as mentioned by the CIT(A). Before the Tribunal, the assessee submitted that the there was a dispute but the assessee has not demonstrated that any legal action in respect of the dispute with the seller was taken or not. Besides this, the assessee is enjoying the possession of the property which shows that the assessee, as per the documents, must have paid the amount of Rs.18,00,000/-. Even for the time being it is taken into account that the assessee has paid fully but the reflection of the payment in his details of Bank account is not demonstrated or properly linked by ITA No.1113/Ahd/2024 Assessment Year: 2016-17 Karim Tajdin Halani vs. ITO Page 3 of 3 the Assessing Officer and merely estimation cannot be termed as unexplained investment from undisclosed sources. The decision of the Hon’ble Gujarat High Court in the case of CIT vs Star Builders (IT Ref. No.9 of 1999, order dated 13.11.2006) merely mentioned that the mere suspicion cannot be ground for making addition. Therefore, in the present case, the Assessing Officer as well as the CIT(A) has only presumed that there was payment of Rs.18,00,000/- which is not reflected in any of the accounts or demonstrated by the Assessing Officer that the assessee made only payment of Rs.18,00,000/-. Thus, appeal of the assessee is allowed 8. In the result, appeal filed by the assessee is allowed. Order pronounced in the open Court on this 27th December, 2024. Sd/- (SUCHITRA KAMBLE) Judicial Member Ahmedabad, the 27th day of December, 2024 PBN/* Copies to: (1) The appellant (2) The respondent (3) CIT (4) CIT(A) (5) Departmental Representative (6) Guard File By order TRUE COPYE COPY Assistant Registrar Income Tax Appellate Tribunal Ahmedabad benches, Ahmedabad "