OM BHOO VIKAS REAL ESTATE PVT. LTD., DURG,DURG V. ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE-1(1), BHILAI, DURG

ITA 23/RPR/2024

AI Insights

The case involves Om Bhoo Vikas Real Estate Pvt. Ltd., which appealed against the orders of the Assistant Commissioner of Income Tax, Bhilai, for three consecutive assessment years (2016-17, 2017-18, and 2018-19). The primary issues revolved around the additions made under section 43CA for undervalued property sales and section 68 for unexplained credits in the form of share capital and premium. The Tribunal examined whether the ACIT had appropriately applied the provisions of the Income Tax Act and whether the additions were justified based on the evidence and submissions provided by the appellant.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 106834 (ITAT-RAIPUR)
• Duration Of Justice: 10 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-11-2024
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Next Hearing Date: 19-11-2024
• Assessment Year: 2018-2019
• Appeal Filed On: 22-01-2024
• Other Referred Cases: M/s Su-raj Diamond dealers Pvt. Ltd. vs PCIT, Aaryadeep Complex Pvt. Ltd. vs PCIT, CIT Vs Ultra Modern Exports (P) Ltd
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: MOHAL AGRAWAL
• Assessee Lawyers: B. SUBRAMANYAM
• Keywords: Set aside; Capital asset; Opportunity of being heard; Additional evidence; Unexplained cash credit; Unexplained investment; Sale consideration of property below Jantri Value; Fair market value; Capital Gains; Principle of natural justice; TDS
• Section: 143(3); 142(1); 143(2); 250; 154; 43CA; 68; 22; 73; 37; 2; 50C; 40(a)(ia)

Judgement Text

"आयकर अपीलीय अिधकरण, रायपुर Ɋायपीठ, रायपुर IN THE INCOME TAX APPELLATE TRIBUNAL RAIPUR BENCH, RAIPUR ŵी रिवश सूद, Ɋाियक सद˟ एवं ŵी अŜण खोड़िपया, लेखा सद˟ क े समƗ । BEFORE SHRI RAVISH SOOD, JM & SHRI ARUN KHODPIA, AM आयकर अपील सं. / ITA Nos: 21, 22 & 23/RPR/2024 (िनधा[रण वष[ Assessment Years: 2016-17, 2017-18 & 2018-19) Om Bhoo Vikas Real Estate Pvt. Ltd., Opposite to New Bus Stand Pachri Para, Durg, 490001, Chhattisgarh V s Assistant Commissioner of Income Tax, Circle-1(1), Bhilai PAN: AAACO6952A (अपीलाथŎ/Appellant) . . (ŮȑथŎ / Respondent) िनधाŊįरती की ओर से /Assessee by : Shri B. Subramanyam, CA राजˢ की ओर से /Revenue by : Shri Mohal Agrawal, Sr. DR सुनवाई की तारीख / Date of Hearing : 19.11.2024 घोषणा की तारीख/Date of Pronouncement : 22.11.2024 आदेश / O R D E R Per Arun Khodpia, AM: The captioned appeals pertains to the same assessee for different assessment years, directed against the order of Commissioner of Income Tax (Appeal), NFAC, Delhi [in short “Ld. CIT(A)”] under section 250 of the Income Tax Act, 1961 (for short “the Act”), for the Assessment Year 2016-17, 2017-18 dated 23.11.2023 and Assessment Year 2018-19 dated 28.11.2023, which in turn arises from the order of Assistant Commissioner of Income Tax, Circle- 1(1), Bhilai (in short “Ld. AO”), under Section 143(3) dated 18.12.2018, 29.11.2019 & 20.04.2021, respectively. 2 ITA No. 21,22 & 23/RPR/2024 Om Bhoo Vikas Real Estate Pvt. Ltd. vs ACIT, Circle-1(1), Bhilai 2. The Grounds of appeal and additional ground raised in ITA No. 21/RPR/2024 for the assessment year 2016-17 by the assessee are extracted as under: 1. The Ld CIT Appeals erred in confirming the addition made by Ld AO of Rs. 44,55,000/- without appreciating the facts and circumstances of the case and without exercising the power conferred u/ s 43CA to refer the valuation matter to DVO int spite of the appellant's request. Therefore, the addition is highly arbitrary, baseless, illegal and unjustified. 2. The Ld CIT Appeals erred in confirming the addition made by Ld AO of Rs. 41,51 816/- on account of discount expenses paid by the appellant to the various customers on refund of advance money taken from them earlier without appreciating the fact of the case. Therefore, the addition is highly arbitrary, baseless, illegal and unjustified. 3. The assessee craves leave to add, alter or amend the ground either before or at the time of hearing. Additional Ground of Appeal: 1. That, the Assessment Order framed under section 143(3) of the Act for AY 201617. Assessment framed u/s 143(3) of the Act for AY 2016-17 on the background of Scrutiny Notice Dated 17.09.2017 issued u/s 143(2) of the Act under limited Scrutiny (Computer Aided Scrutiny Selection) vide DIN ITBA/AST/S/143(2)/201718/1006356846(1) dated 17/09/2017. That ITR filed for AY 2016-17 had been selected for Limited Scrutiny on the issue for examination of \"Whether capital gains/loss on sale of property has been correctly shown in the return of Income\". \"On the facts and under the circumstances of the case and in law, The Ld. AO has erred in making addition of Rs. 41,51,816/- on account of discount expenses paid by the Appellant to various customers on refund of advance money taken from them earlier without appreciating that Ld. AO was not required to look into matters other than that forming part of limited scrutiny as decided by CBDT Instruction 7/2014 dated 26.09.2014 and further clarification on its scope vide instruction no. 20/2015 dated 29.12.2015. Hence, the order framed u/s 143(3) of the Act by the Ld. AO is bad in law 3 ITA No. 21,22 & 23/RPR/2024 Om Bhoo Vikas Real Estate Pvt. Ltd. vs ACIT, Circle-1(1), Bhilai with respect to this addition of Rs. 41,51,816/- as same was not required to be verified/inquired by the AO. \" 3. First, we shall be taking up ITA No. 21/RPR/2024 for the assessment year 2016-17. 4. Ground No. 1: Challenging the confirmation on addition of Rs. 44,55,000/- u/s 43CA of the Income Tax Act. 4.1 The brief facts of the issue, as narrated in the assessment order, are culled out as under: 02 On verification of sales of immovable property, it is found that the assessee has sold immovable property at Rs. 79,55,000/-on 12/2/2016. The assessee was asked vide letter dated 23.10.2018 through system to explain that the immovable property which it has sold is taken as stock in trade in books of account. However, he was asked to explain that the fair market value of the property is at Rs. 79,55,00() and the actual sale consideration is at Rs.35,00,000/-. Thus, why the difference of Rs. 44,55,000 should not be taxed. In response, the assessee complied on 18.12.2018 that \"the immovable property is stock in trade since the date of purchase and the valuation is made by the District Sub Registrar. The legislature did not intend that the capital gain should be fixed merely on the basis of the valuation to be made by the District Sub Registrar for the purpose of stamp duty\". The compliance of the assesse has been perused and is not acceptable in view of the provision of section 43CA of Income Tax Act 1961. 4 ITA No. 21,22 & 23/RPR/2024 Om Bhoo Vikas Real Estate Pvt. Ltd. vs ACIT, Circle-1(1), Bhilai Section 43CA is reproduced as below for ready reference:- Where the consideration received or accruing as a result of the transfer by an assessee of an asset (other than a capital asset), being land or building or both, is less than the value adopted or assessed or assessable by any authority of a State Government for the purpose of payment of stamp duty in respect of such transfer, the value so adopted or assessed or assessable shall, for the purposes of computing profits and gains from transfer of such asset, be deemed to be the full value of the consideration received or accruing as a result of such transfer. 03 Thus, in view of the above provisions, the value adopted or assessed by the authority of the State Government is at Rs. 79,55,00() whereas, as per the sale deed, the sale consideration is at Rs. 35,00,000 which the assessee has disclosed in it's book of account and return of income. Thus, the difference is at Rs. 44,55,000 which is to be taxed for the purpose of computing profits and gains from transfer of asset. Thus, Rs.79,55,000 is deemed to be the full value of the consideration as a result of transfer of asset and the assessee has disclosed Rs. 35,00,000 in its return of income. Therefore, Rs. 44,55,000/- is added back to the return of income. (Addition: Rs. 44,55,000/-) 4.2 The issue was challenged before the Ld. CIT(A), wherein the addition made by the Ld AO has been confirmed with the following observations: 6. Observations, Findings and Decisions 6.1 I have perused assessment u/s 143(3) dated 18.12.2018 passed by the Assistant Commissioner of Income Tax, Circle - 1(1), Bhilai for the AY 2016-17 as well as the ground of 5 ITA No. 21,22 & 23/RPR/2024 Om Bhoo Vikas Real Estate Pvt. Ltd. vs ACIT, Circle-1(1), Bhilai appeal, statement of facts, and written submission and other documents in support of the claim filed by the appellant. 6.2 Ground No. 1 is moved by the appellant-company relate to the action of the Ld. A.O regarding addition of Rs. 44,55,000/- on account of capital gains on the sale of landed property. The Ld AO has dealt with the case as under:- \"In this case return of income was filed on 15.12.2016 through e-filing declaring total income NIL and disclosed business loss Rs. 98,342/- for the year under consideration. The case was selected for \"Limited Scrutiny\" through CASS. Accordingly, notice u/s. 143(2) of the Act was issued by predecessor on 17.09.2017. The notice was duly served on the assessee. In response, assessee asked for adjournment and he complied on 28.09.2017. Copy of / TR and Audit Report have been perused. Subsequently, the case was received on transfer to this office. Further notice u/s 142(1) along with the questionnaire of the l. Tax Act 1961 was issued on 02.02.2018 fixing the case for hearing on 15.02.2018. On 08.03.2018, the assessee furnished the letter however, no enclosure were furnished by him. Due to the change in incumbent, notice u/s 142(1) was issued on 29.09.2018 fixing the case for hearing on 11.10.2018. On 08.03.2018, assessee complied the annexures which were asked as per questionnaire. On perusal of assessee's compliance, a show cause notice was issued on 23.10.2018 regarding the sale of immovable property through I TBA portal and the assessee was asked to furnish information through system. The information furnished by the assessee has been examined. Accordingly, the assessment is completed u/s 143(3) of the Act with the following observations. On verification of sales of immovable property, it is found that the assessee has sold immovable property at Rs. 79,55,000/- on 12/02/2016. The assessee was asked vide letter dated 23.10.2018 through system to explain that the immovable property which it has sold is taken as stock-in-trade in books of account. However, he was asked to explain that the fair market value of the property is at Rs. 79,55,000/- and the actual sale consideration is 6 ITA No. 21,22 & 23/RPR/2024 Om Bhoo Vikas Real Estate Pvt. Ltd. vs ACIT, Circle-1(1), Bhilai at Rs. 35, 00,000/-. Thus, why the difference of Rs. 44, 55, 000/- should not be taxed. In response, the assessee complied on 18.12.2018 that- \"the immovable propetty is stock-in-trade since the date of purchase and the valuation is made by the District Sub Registrar. The legislature did not intend that the capital gain should be fixed merely on the basis of the valuation to be made by the District Sub Registrar for the purpose of stamp duty\". The compliance of the assessee has been perused and is not acceptable in view of the provision of section 43CA of Income Tax Act, 1961. Section 43CA is reproduced as below for ready reference:- Where the consideration received or accruing as a result of the transfer by an assessee of an asset (other than a capita/ asset), being land or building or both, is less than the value adopted or assessed or assessable by any authority of a State Government for the purpose of payment of stamp duty in respect of such transfer, the value so adopted or assessed or assessable shall, for the purposes of computing profits and gains from transfer of such asset be deemed to be the full value of the consideration received or accruing as a result of such transfer. Thus, in view of the above provisions, the value adopted or assessed by the authority of the State Government is at Rs. 79, 55,000/- whereas, as per the sale deed, the sale consideration is at Rs. 35,00,000/- which the assessee has disclosed in its book of account and return of income. Thus, the difference is at Rs. 44, 55,000/- which is to be taxed for the purpose of computing profits and gains from transfer of asset Thus, Rs. 79, 55,000/- is deemed to be the full value of the consideration as a result of transfer of asset and the assessee has disclosed Rs. 35, 00, 000/- in its return of income. Therefore, Rs. 44, 55, 000/- is added back to the return of income. \" 7 ITA No. 21,22 & 23/RPR/2024 Om Bhoo Vikas Real Estate Pvt. Ltd. vs ACIT, Circle-1(1), Bhilai 6.3 In contrary the appellant has submitted in support of ground No. 1 the followings:- \"The Ld. Assessing Officer erred in making addition of Rs. 44,55,000/- without considering the facts and circumstances of the case. In the reply during assessment proceedings the assessee company has duly submitted that the land sold by the assessee was situated in cettain location which was difficult to be sold out because the land was situated just besides the river and the water gets blocked and there was no road connecting to the plot. The Assessee Company has also duly requested verbally as well in written request during the assessment proceeding on dated 06/11/2018 to refer the case to the DVO for getting the valuation done of the land sold. But the request was overlooked by the assessing officer. The assessee has no mala fide intention and it has duly submitted al/ the requirements during assessment proceedings, copy of sale agreement and has even requested to get the valuation done. But the facts of the case were overlooked and addition was made by the Ld. Assessing officer without giving any weightage to the request and circumstance and facts of the case. The assessee when getting the buyer but at the price which was below the Value as adopted by the Government, the assessee accepted the offer to realize whatever it can get and sold the plot of land at Rs. 35,00,000/- However, the price was below the Value adopted by the State Government but in the situation where it was difficult to get the buyer any prudent business would have done the same to realize whatever it is getting and would have entered in to the transaction. But the Ld. Assessing was so determined to make the addition that did not have any importance that the plot was difficult to be sold at the place where it was near the river and water gets blocked and without any approach to the same. Hence, the addition made by the Ld. Assessing Officer is arbitrarily, un justified and bas in law. The assessee has duly submitted all the books and vouchers during assessment proceedings however, the same was not giving any importance and addition was made. In case your honor 8 ITA No. 21,22 & 23/RPR/2024 Om Bhoo Vikas Real Estate Pvt. Ltd. vs ACIT, Circle-1(1), Bhilai may require any other documents the assessee may submit the details for your verification and records. \" 6.4 During the appellate proceedings before me notice u/s 250(4) was issued calling for certain documents/explanation which are reproduced as under:- \"Please furnish the followings:- (i) Purchase deed of the land which was s/od during the year under consideration, (ii) Cost of the land and proof of payments, (iii) Date of purchase, (iv) Site map of the land, (v) Was it an agricultural land and whether any agricultural activities was carried on by your company since you purchase the same or by earlier holder, (vi) Whether the land so sold to are your relatives or friend or known to the directors of the company, (vii) Please explain when the land is not suitable for agricultural purpose and it gets flooded with water during rainy season being situated just beside the river Shivnath and some of the land has gone into the river by way of erosion then how the purchaser of the land will be interested to buy the same who are also knowing the said fact. This information is being called u/s 250(4) of the l. T.Act 1961 and your reply should reach on or before the date mentioned in the notice above. \" 6.5 However, the required documents and explanations were not submitted instead the appellant reiterated what has been stated earlier in the written submission which has been re-produced earlier. Thus, for want of information vide Sl. No.(i) to (vii) of the notice u/s 250(4) no cognizance can be given to the appellant's claim that value of the land at the time of sale was much below the fair market value. The appellant's arguments 9 ITA No. 21,22 & 23/RPR/2024 Om Bhoo Vikas Real Estate Pvt. Ltd. vs ACIT, Circle-1(1), Bhilai that land is not suitable for agricultural purpose and it gets flooded with water during rainy season being situated just beside the river Shivnath and some of the land has gone into the river by way of erosion. If that be the case, no one will buy the said land. The Id AO has also dealt with the objection raised by the appellant regarding valuation of the land by the DVO in view of section 43CA of the Act. Thus, in view of the discussion made above, I find no infirmity in the order the Ld AO and confirm the addition of Rs. 44,55,000/-. The ground No. l is, thus, dismissed. 4.3 Aggrieved with the aforesaid confirmation by the Ld. CIT(A), assessee preferred an appeal before the ITAT, which is under consideration before us in the instant case. 4.4 On the issue, Ld. Authorized Representative on behalf of the assessee, Shri B. Subramanyam, CA (in short, “Ld. AR) submitted that, while dealing with the issue Ld. AO observed that the assessee had not followed the provisions of section 43CA, whereas the contention of assessee that the legislature did not intend to that the capital gain should be fixed merely on the basis of valuation to be made by the District Sub-Registrar for the purpose of stamp duty, was neglected by the Ld AO. It was the submission that the value adopted or assessed by the authority of state government should not be treated as sale consideration without referring the matter to DVO in terms of provisions of Section 43CA r.w.s. 50C(2). On confronting the Ld. AR that whether the assessee had requested before the Ld AO for making a reference of the matter to DVO, our attention was drawn to the assessee’s paper books at page no. 247-248, containing a request letter dated 06.11.2018 submitted on 13.12.2018, 10 ITA No. 21,22 & 23/RPR/2024 Om Bhoo Vikas Real Estate Pvt. Ltd. vs ACIT, Circle-1(1), Bhilai seeking reference to the Departmental Valuation Officer (DVO) as contemplated under the provisions of Section 50C. The letter so submitted by the assessee along with acknowledgment is extracted hereunder for the sake of completeness of facts: 11 ITA No. 21,22 & 23/RPR/2024 Om Bhoo Vikas Real Estate Pvt. Ltd. vs ACIT, Circle-1(1), Bhilai 4.5 Based on aforesaid submissions, it was the prayer that the matter should be set aside to the files of Ld. AO for reconsideration in terms of provisions of section 43CA r.w.s. 50C(2). 4.6 Ld. Senior Departmental Representative, Shri Mohal Agrawal (for short “Ld. Sr. DR) on the other hand vehemently supported the orders of revenue authorities and submitted to uphold the same. 4.7 We have considered the rival submissions, perused the material available on record. To interpret the aforesaid issue, the provisions of section 43CA and 50C(2) are reproduced as under: 12 ITA No. 21,22 & 23/RPR/2024 Om Bhoo Vikas Real Estate Pvt. Ltd. vs ACIT, Circle-1(1), Bhilai 43CA.(1) Where the consideration received or accruing as a result of the transfer by an assessee of an asset (other than a capital asset), being land or building or both, is less than the value adopted or assessed or assessable by any authority of a State Government for the purpose of payment of stamp duty in respect of such transfer, the value so adopted or assessed or assessable shall, for the purposes of computing profits and gains from transfer of such asset, be deemed to be the full value of the consideration received or accruing as a result of such transfer: Provided that where the value adopted or assessed or assessable by the authority for the purpose of payment of stamp duty does not exceed one hundred and ten per cent of the consideration received or accruing as a result of the transfer, the consideration so received or accruing as a result of the transfer shall, for the purposes of computing profits and gains from transfer of such asset, be deemed to be the full value of the consideration: Provided further that in case of transfer of an asset, being a residential unit, the provisions of this proviso shall have the effect as if for the words \"one hundred and ten per cent\", the words \"one hundred and twenty per cent\" had been substituted, if the following conditions are satisfied, namely:— (i) the transfer of such residential unit takes place during the period beginning from the 12th day of November, 2020 and ending on the 30th day of June, 2021; (ii) such transfer is by way of first time allotment of the residential unit to any person; and (iii) the consideration received or accruing as a result of such transfer does not exceed two crore rupees. 13 ITA No. 21,22 & 23/RPR/2024 Om Bhoo Vikas Real Estate Pvt. Ltd. vs ACIT, Circle-1(1), Bhilai (2) The provisions of sub-section (2) and sub-section (3) of section 50C shall, so far as may be, apply in relation to determination of the value adopted or assessed or assessable under sub-section (1). (3) Where the date of agreement fixing the value of consideration for transfer of the asset and the date of registration of such transfer of asset are not the same, the value referred to in sub-section (1) may be taken as the value assessable by any authority of a State Government for the purpose of payment of stamp duty in respect of such transfer on the date of the agreement. (4) The provisions of sub-section (3) shall apply only in a case where the amount of consideration or a part thereof has been received by way of an account payee cheque or an account payee bank draft or by use of electronic clearing system through a bank account or through such other electronic mode as may be prescribed on or before the date of agreement for transfer of the asset. Explanation.—For the purposes of this section, \"residential unit\" means an independent housing unit with separate facilities for living, cooking and sanitary requirement, distinctly separated from other residential units within the building, which is directly accessible from an outer door or through an interior door in a shared hallway and not by walking through the living space of another household. Section 50C(2) (2) Without prejudice to the provisions of sub-section (1), where— 14 ITA No. 21,22 & 23/RPR/2024 Om Bhoo Vikas Real Estate Pvt. Ltd. vs ACIT, Circle-1(1), Bhilai (a) the assessee claims before any Assessing Officer that the value adopted or assessed or assessable by the stamp valuation authority under sub-section (1) exceeds the fair market value of the property as on the date of transfer; (b) the value so adopted or assessed or assessable by the stamp valuation authority under sub-section (1) has not been disputed in any appeal or revision or no reference has been made before any other authority, court or the High Court, the Assessing Officer may refer the valuation of the capital asset to a Valuation Officer and where any such reference is made, the provisions of sub-sections (2), (3), (4), (5) and (6) of section 16A, clause (i) of sub-section (1) and sub-sections (6) and (7) of section 23A, sub-section (5) of section 24, section 34AA, section 35 and section 37 of the Wealth- tax Act, 1957 (27 of 1957), shall, with necessary modifications, apply in relation to such reference as they apply in relation to a reference made by the Assessing Officer under sub-section (1) of section 16A of that Act. Explanation 1.—For the purposes of this section, \"Valuation Officer\" shall have the same meaning as in clause (r) of section 2 of the Wealth-tax Act, 1957 (27 of 1957). Explanation 2.—For the purposes of this section, the expression \"assessable\" means the price which the stamp valuation authority would have, notwithstanding anything to the contrary contained in any other law for the time being in force, adopted or assessed, if it were referred to such authority for the purposes of the payment of stamp duty. (3) Subject to the provisions contained in sub-section (2), where the value ascertained under sub-section (2) exceeds the value adopted or assessed or assessable by the stamp valuation authority referred to in sub-section (1), the value so adopted or assessed or 15 ITA No. 21,22 & 23/RPR/2024 Om Bhoo Vikas Real Estate Pvt. Ltd. vs ACIT, Circle-1(1), Bhilai assessable by such authority shall be taken as the full value of the consideration received or accruing as a result of the transfer. 4.8 As per settled position and mandate of law, it is well defined that section 43CA r.w.s. 50C(2) explains that whenever, the assessee claim that value adopted for the purpose of stamp duty is in excess of Fair Market Value, the Ld. AO may referrer it for valuation to Departmental Valuation Officer (DVO). We, therefore, convince and coincide with the submissions of the Ld. AR that the Ld. AO should have referred the matter to DVO, accordingly, we direct the Ld. AO to refer the issue for valuation of impugned property sold during the year. After considering the report of DVO, the Ld. AO thereafter, shall pass the order giving effect of the same, after giving reasonable opportunity of being heard and furnish explanations/submission to the assessee. Under such facts and circumstances, where there was a request of assessee for reference to the DVO, which was not acceded to by the Ld. AO was an absolute violation of principle of natural justice, the issue is restored back to the files of Ld. AO for fresh adjudication in terms of aforesaid observations. 4.9 In result, Ground No. 1 of the present appeal is partly allowed for statistical purposes. 16 ITA No. 21,22 & 23/RPR/2024 Om Bhoo Vikas Real Estate Pvt. Ltd. vs ACIT, Circle-1(1), Bhilai 5. Ground No. 2: Challenging the confirmation of addition for Rs.41,51,816/- on account of discount expenses paid by the appellant to the various customers along with refund of advance money taken from them. 5.1 While making the aforesaid addition, Ld. AO’s observations were as under: 04. On verification of sales, it is found that the assessee has claimed \"discount\" at Rs.42,07,732 during the year under consideration. Verification of \"other expenses\" claimed by the assessee company revealed that from preceding year the assessee has brought a new head of expenses which is debited as \"other expenses\" Rs.41,51,816/- under the head \"Discount\" during the year under consideration. The assessee was as ed to explain the expenses claimed as \"discount\" vide letter dated 11.12.2018 wherein, he was asked to comply the party wise transaction made under the head \"discount\" whereas in independent auditor's report it is remarked that the company has not complied with the provisions of section 73 to section 76 of the companies Act 2013 and the following is the contraventions that \"discount expenses debited to profit and loss in the nature of interest and company had not deducted any tax thereon\". 05. In response, the assessee complied on 13.12.2018. The version of the assessee is reproduced as below:- Discount expenses is actually, booking cancellation charges i.e. a compensation paid to customers by the company, on cancellation of plot booking. Company is engaged in sale of land to small customers spread in various different areas and villages of Durg, Rajnandgaon, Dhamtari, Kanker & other parts of the C.G. State. We 17 ITA No. 21,22 & 23/RPR/2024 Om Bhoo Vikas Real Estate Pvt. Ltd. vs ACIT, Circle-1(1), Bhilai have taken small amount in installment for small size of plots situated in the different parts of the State C.G. Some time company has failed to provide the land to the customers at promised area and customer do not prefer to take the plot at other area allotted to them, therefore booking of customers is cancelled and as a compensation, company has paid them booking cancellation charges according to amount deposited and how long they waited for the same. As per our accounting policy, consistently followed over the years, we have treated the same as discount expenses and not deducted tax on the same, but as per the opinion of the auditor, the compensation paid was of the nature of interest paid to the customers on booking cancellation, and in his opinion, TDS was required to be deducted under section 194A of the Income Tax Act, 1961, on payment to individual persons exceeding Rs. 5,000/in the financial year. Total discount expenses debited to profit and loss account during the year under co sideration was Rs. 42,07,732/-, details of which are as under 1. Total expenses debited to profit and loss account Rs. 42,07,732/- 2. Less: Amount paid less than Rs. 5000/- to an individual Rs. 12,43,370/- 1. Payment to an individual more than Rs. 5000(Liable for TDS) Rs. 29,64,362/- Further, Section 40(a)(ia) states that 30& the expenditure shall be disallowed on which the TDS is not deducted. Now we offer Rs. 8,89,309/- for addition (i.e. 30% of the expenses liable for TDS amounting to Rs. 29,64,362/-) due to non-deduction of TDS on the same. we have not deducted tax due to our accounting policy, treating the same as discount expenses and there is no malafied intention for non-complying the provision of TDS. 18 ITA No. 21,22 & 23/RPR/2024 Om Bhoo Vikas Real Estate Pvt. Ltd. vs ACIT, Circle-1(1), Bhilai 06. The version of the assessee has been gone through and is not acceptable for the following reasons. (i) The assessee claimed that expenses debited are discount expenses, booking cancellation charges/ compensation paid to customers by the company. First of all, the assessee has not wen the party wise head in whose hand the said amount was received along with the bank statement. ii) The assesse had complied ledger account of payment where nothing specification has been mentioned. iii) The assessee itself has accepted the amount debited are the booking cancellation charges on account of booking of customer. It is pertinent to mention here that the amount is received by the assessee is booking charges against sale of land and if it is canceled than the amount which is paid to the customers are booking amount which also includes discount as per the say of the assessee whereas, he has not proved that with evidence, bank statement, customer lot, the booking was made and discount was given. There is no su stance to treat the same as interest amount. 07. From the details mentioned in the ledger account, it has come to notice that assessee company returned the advance money deposited by the customer to him but instead of returning original amount of deposit after deduction, the assessee paid discount of some amount to him and returned him original deposited amount and discount amount i.e., the assessee was required to justify such discount. However, the assessee has not furnished postal address of these persons in spite of notice issued to him. Further, at the time of booking of land, the lender enters into agreement with the customer in writing the terms and conditions of booking/cancellation, mode of payment and litigation in future, in case of dispute. The assesse was also directed to furnish complete bank statements for all the banks for the F Y 2015-2016, so that claim of assessee can be verified. The assessee 19 ITA No. 21,22 & 23/RPR/2024 Om Bhoo Vikas Real Estate Pvt. Ltd. vs ACIT, Circle-1(1), Bhilai failed to produce any substantial documentary evidence to explain it's case that any such agreement was entered regarding to grant Discount to the customers. Further, discount is granted as and when the assessee gets sale proceeds or to attract the customers. No such prevailing circumstances are found in this case. Moreover, generally the trader/builder deduct certain percentage from the advance money when it is taken back by the depositor as penalty because by this way he loose his customer. In these circumstances, the genuineness of the transaction are not proved. Question of treati t as interest is not considered as the head is not classified properly with evidence. Henc disallowance s 40(a)(ia) is not considered. e expen is dis as it is remained unexplained and added back to the total income of the assessee. Thus, addition of Rs.41 ,5 1 16/- to returned income is hereby made as the expenditure which is not explained as in whose hand this amount of discount is received. Thus, addition of Rs. 41,5 1,816/-. (Addition of Rs.41,51,816/-) 5.2 The issue thereafter was carried before the Ld. CIT(A), wherein the ground assailed by the assessee has been dismissed with the following observations: 6.8 I have perused the assessment order and also the appellant's submission. On similar fact and circumstance, I have decided the issue against t appellant. The relevant part of the order is re-produced below:- \"On perusal of both the AO's finding and the appellant's submission, it is observed that there is no dispute that the appellant did not furnish the addresses of the customers who booked plot of land and re un was given to them with compensation for not able to handover the land to them. Secondly, the Ld. AO called for bank statements to verify the payments made to them and thirdly no 20 ITA No. 21,22 & 23/RPR/2024 Om Bhoo Vikas Real Estate Pvt. Ltd. vs ACIT, Circle-1(1), Bhilai agreements were reached for such an eventuality at the time of booking of land. The appellant's contention may be right that to keep the goodwill of the company and to avoid ligation they have paid compensation for not able to handover the land to the prospective buyers but without any verification of the same the Ld AO could not have allowed the same. The analogy drawn by the appellant is genera/ in nature for want of the three documents called for. The appellant has raised the issue of avoiding litigation which indicates that it cannot be one of such situations as the company's business activities is of dealing in land. Thus, to avoid such situations, there should be some legal documents by way of agreement so that details of payment while booking and subsequently details of payments either in instalment or on delivery needs to be mentioned and in case it is refunded by the owner of the land, in the present case it is the appellant company, the rate of interest or any other term be fixed so that there arise no dispute in future. Further, the payment of compensation, if any, paid may be substantiated by producing the same before various authorities like, income tax, consumer protection forum, etc. In absence of the same the expenses so made for the compensation may not legally be sustainable. The case laws relied upon by the appellate are al/ distinguishable on fact of the present case. Thus, considering the discussion made above, I do not find any infirmity in the order of the appellant and, therefore, confirm the addition of Rs. 41,51,816/- paid on account of compensation. The ground No. 1 is, thus, dismissed. \" 6.9 Having identical facts and in the same circumstances, I decide the issue here also in the same manner. The grounds taken by the appellant are, thus, dismissed. However, regarding the amount of addition it is observed from the assessment order that the Ld AO mentioned the discount at Rs. 42,07,732/- for the year under consideration but while disallowing under the said head took the figure of A. Y. 2015- 21 ITA No. 21,22 & 23/RPR/2024 Om Bhoo Vikas Real Estate Pvt. Ltd. vs ACIT, Circle-1(1), Bhilai 16 which is Rs. 41,51,816/- as mentioned in his order. The mistake is Bonafide and apparent from record and hence a rectifiable mistake u/s 154 of the Act. The AO is thus directed to rectify the said mistake after affording the appellant opportunity of being heard. 5.3 Aggrieved with the aforesaid decision of Ld. CIT(A), the assessee herein is before us with its grievance in the present appeal. 5.4 At the outset, Ld. AR on behalf of the assessee submitted that the revenue authorities have doubted the genuineness of transactions for the reason that the assessee was unable to furnish the address of customers, who booked plot of land and refund was given to them with compensation, being unable to hand over the land to them. The second cause for dismissal of assessee’s contention are that the bank statements are not furnished before the Ld. AO and thirdly no agreements were produced before the Ld. AO to verify the veracity of the transactions. In this respect, as directed Ld. AR furnished before us a paper book containing 116 pages, as additional evidence under Rule 29 dated 18.11.2024 containing therein the party wise details of discount expenses incurred comprising of Sr. No., Name, Address, Cheque No., Clearing Date, Discount Amount & Bank name. The additional evidence also includes sample copies of receipts acknowledging payments / refund of advance along with so-called discount to the customers, Application letter, Allotment letter and terms and conditions. It was the submission that all the payments were genuinely 22 ITA No. 21,22 & 23/RPR/2024 Om Bhoo Vikas Real Estate Pvt. Ltd. vs ACIT, Circle-1(1), Bhilai made to the customers of the assessee through proper banking channel and if required the customers can be cross examined so as to arrive at a logical conclusion regarding the authenticity of all these payments. It was, therefore, the prayer that the addition made treating the expenditure of discount as not explained was uncalled for and the same is liable to be deleted. 5.5 Ld. Sr. DR on the other hand vehemently supported the order of Ld. CIT(A) and have stated that the revenue authorities had rightly dealt with the issue and in absence of necessary information by the assessee, the discount expenses booked are unexplained, thus, are correctly added to the income of the assessee. In view of such facts the impugned order of Ld. CIT(A) deserves to be upheld. 5.6 We have considered the rival submissions and perused the material available on record. Admittedly, in the present case the ledger accounts of the discount expenses were furnished by the assessee before the Ld. AO (copy placed before us at APB page no. 168-218) showing cheque no., narration and the name of customer to whom the amount was refunded. The Bank statement, ITR, Audited Financial Statements were also furnished before the Ld. Revenue Authorities. In order to explain / clarify, further a detail of such payments has been furnished before us in the form of additional evidence, on perusal of the same, it is evident that such payments were made through banking channel. Though certain information were not available 23 ITA No. 21,22 & 23/RPR/2024 Om Bhoo Vikas Real Estate Pvt. Ltd. vs ACIT, Circle-1(1), Bhilai before the Ld. AO, therefore, the genuineness and veracity of the same could not be examined. Copy of sample agreements are also produced before the Ld. AO/ Ld. CIT(A). However, nothing is on the record that the assessee was advised to produce the customers for cross examination. Under such circumstances, considering the evidence available on record, we find it apt to restore the matter back to the file of Ld. AO for reverification of the fact and re-adjudicate after investigating about the genuineness of expenses which were doubted in absence of details and evidence on record. The assessee is directed to cooperate in the set aside assessment proceedings failing which, the Ld. AO would be at liberty to adjudicate the issue as per law. However, reasonable opportunities of being heard shall be afforded to the assessee. 5.7 In result, Ground No. 2 of the present appeal is partly allowed for statistical purposes. 6. Apropos, the additional ground raised by the assessee, that the reopening assessment in the present case was initiated under “Limited Scrutiny” through CASS on the issue that “Whether the capital gain / loss on sale of property has been correctly shown in the return of income.”, therefore, the Ld. AO was not authorized to look into the matters forming part of limited scrutiny as per CBDT Instruction No. 7/2014 dated 26.09.2014 and Instruction No. 20/2015 dated 29.12.2015. It is the 24 ITA No. 21,22 & 23/RPR/2024 Om Bhoo Vikas Real Estate Pvt. Ltd. vs ACIT, Circle-1(1), Bhilai submission by Ld. AR that the Ld. AO had traversed beyond the scope and had looked into the expenditure incurred under the head “Discount” to customers, therefore, the order of Ld. AO was without jurisdiction on this issue, accordingly, the same is liable to be reversed on this issue. Ld. AR placed his reliance on the following Judicial Pronouncements: (i) M/s Su-raj Diamond dealers Pvt. Ltd. vs PCIT, (2020) 185 DTR 001 (Mum. Trib.) (ii) Aaryadeep Complex Pvt. Ltd. vs PCIT, (2022) 218 DTR 0025 (Raipur Trib.) 7. On the issue of Limited Scrutiny, Ld. Sr. DR submitted that the income from sale of land by the assessee is further reduced by the expenditure of discount, therefore, the same is a connected issue, so the contentions of Ld. AR are not acceptable, the Ld AO was well within his powers to touch, enquire and decide the issue. 8. We have considered the rival submissions, perused the material available on record and judicial pronouncements relied upon by the assessee. We find force in the contentions raised by the Ld. Sr. DR, being the issue for which the reopening was initiated pertains to sale of property and the expenditure on discount incurred by the assessee are debited in the P&L, thereby reducing the profit on sale of property, thus, is an interconnected issue, therefore, the Ld. AO was well within his powers to examine such issue under the scope of Limited Scrutiny. We, therefore, are of the 25 ITA No. 21,22 & 23/RPR/2024 Om Bhoo Vikas Real Estate Pvt. Ltd. vs ACIT, Circle-1(1), Bhilai considered opinion that the additional ground raised by the Ld. AR on behalf of the assessee is bereft of merits, thus, the same is rejected. 9. Ground No. 3: It is a general ground having no further advancement of arguments or grievance, therefore the same become infructuous, thus, stands dismissed. 10. In result, ITA No. 21/RPR/2024 for the assessment year 2016-17 of the assessee is partly allowed for statistical purposes. 11. ITA No. 22/RPR/2024 for the assessment year 2017-18. 11.1 The grounds of appeal raised by the assessee are as under: 1. The Ld CIT Appeals erred in confirming the addition made by Ld. AO of Rs. 66,02,000/- without appreciating the facts and circumstances of the case and without exercising the power conferred u/s 43CA to refer the valuation matter to DVO in spite of the appellant's request. Therefore, the addition is highly arbitrary, baseless, illegal and unjustified. 2. The Ld CIT Appeals erred in confirming the addition made by Ld. AO of Rs. 24, 10,789/- on account of discount expenses paid by the appellant to the various customers on refund of advance money taken from them earlier without appreciating the fact of the case. Therefore, the addition is highly arbitrary, baseless, illegal and unjustified. 2. The assessee craves leave to add, alter or amend the ground before or at the time of hearing. 26 ITA No. 21,22 & 23/RPR/2024 Om Bhoo Vikas Real Estate Pvt. Ltd. vs ACIT, Circle-1(1), Bhilai 11.2 The ground of appeal in assessee’s appeal for AY 2017-18 are similar to the grounds of appeal in ITA No. 21/RPR/2024 for the AY 2016-17 except quantum of the additions, our aforesaid decision and observations therein, therefore, shall apply mutatis mutandis to the grounds of appeal in ITA No. 22/RPR/2024 for AY 2017-18. Accordingly, ITA No. 22/RPR/2024 for the assessment year 2017-18 of the assessee is partly allowed for statistical purposes. 12. ITA No. 23/RPR/2024 for the AY 2018-19 12.1 The grounds of appeal raised by the assessee are as under: 1. The Ld CIT Appeals erred in confirming the addition made by Ld AO of Rs. 71,15,890/- as unexplained credit u/s 68 of the Income Tax Act, 1961 received by appellant on account of Equity Share capital and premium. The, addition made by Ld AO is highly arbitrary, unjustified and unwarranted on the facts and in the circumstances of the case may kindly be deleted. 2. The assessee craves leave to add, alter or amend the ground before or at the time of hearing. 12.2 The sole controversy in the appeal of assessee for AY 2018-19 is qua the addition by Ld. AO u/s 68 on account of unexplained investment received by the assessee in the garb of share capital and premium. 27 ITA No. 21,22 & 23/RPR/2024 Om Bhoo Vikas Real Estate Pvt. Ltd. vs ACIT, Circle-1(1), Bhilai 12.3 During the assessment proceedings, the assessee was required to furnish details of shareholders to whom the assessee company had issue 69,791 shares at the face value of Rs. 10 and premium of Rs. 91.96 per share aggregating to Rs. 64,00,090/-. In response, certain information has been furnished by the assessee, the same is extracted by the Ld. AO in the assessment order, which for the sake of clarity has been extracted as under: 5.2 In this connection, the assessee vide its reply dated 10.02.2021 has also submitted documentary evidence to prove the creditworthiness of the shareholder and genuineness of the transactions. On verification of the details submitted, the following observations has been made: 28 ITA No. 21,22 & 23/RPR/2024 Om Bhoo Vikas Real Estate Pvt. Ltd. vs ACIT, Circle-1(1), Bhilai 29 ITA No. 21,22 & 23/RPR/2024 Om Bhoo Vikas Real Estate Pvt. Ltd. vs ACIT, Circle-1(1), Bhilai 30 ITA No. 21,22 & 23/RPR/2024 Om Bhoo Vikas Real Estate Pvt. Ltd. vs ACIT, Circle-1(1), Bhilai 12.4 On perusal of aforesaid documents produced by the assessee, Ld. AO have observed certain deformities and reasons for making the addition, such observations of Ld. AO are as under: 5.2 In the cases where bank statement were provided the following observations were noticed: 31 ITA No. 21,22 & 23/RPR/2024 Om Bhoo Vikas Real Estate Pvt. Ltd. vs ACIT, Circle-1(1), Bhilai (i) Assessee had not received the equal amount of the share issued. For example, Yashwant Kumar Sahu was allotted 2006 share value of the shares as mentioned above is at Rs. 2,04,531.8/- However, no such amount was paid by Yashwant Kumar. (ii) It was also noted that Yashwant Kumar had paid Rs. 2,00,000/- to the assessee after the credit entry of Rs. 2,00,000/- in his account just before transferring the amount. (iii) In most of the cases, the amount was paid after the credit entry of the equal amount. (iv) Apart from above analysis of bank statement, it is seen that in many cases no PAN is provided. It is also pertinent to note that assessee has not provided details of PAN of share holder but it is collected from different details like ITR, bank statement etc. Keeping in view of above position, bank statement itself is speaking about the credit only in bank account which is not matching share value, puchased by respective shareholders 6. Addition u/s 68 on account of non-genuine share premium plus face value of shares: As discussed above, during the year assessee had shown an amount of Rs. 64,00,090/- as amount received from the shareholders for share premium plus face value issued during the year under consideration. 32 ITA No. 21,22 & 23/RPR/2024 Om Bhoo Vikas Real Estate Pvt. Ltd. vs ACIT, Circle-1(1), Bhilai 6.1 On verification of the details submitted by the assessee to prove the genuineness and creditworthiness of the shareholders it was noticed that the persons who had been allotted shares of the assessee company had paid the amount to the assessee company after making cash deposit /credit entries of more or less the same amount in their respective bank accounts within 2 to 3 days. Therefore, the creditworthiness of the shareholders were doubtful. 6.2 Further, in the most of the cases, the assessee has failed to submit the documentary evidence to prove the creditworthiness and genuineness of the transaction. As discussed above, the assessee failed to prove the creditworthiness of the shareholder to the tune of Rs. 71,15,890/- being the share premium plus face value of shares issued. Therefore, this amount of Rs. 71,15,890/- is liable to be added to the total income of the assessee u/s 68. Accordingly, an addition of Rs. 71,15,890/- is made to the total income of the assessee after treating the same as unexplained cash credit u/s 68 of the Act. Penalty proceedings u/s.271AAC are initiated separately for concealment of income. 7. Subject to the above remarks and from the data made available, total income of the assessee is modified and recomputed as under: Total income as per return of income Rs. 15,81,950/- Add: Income from other source as per the provisions of sec. 68 of the Act Rs. 71,15,890/- Total Assessed Income Rs. 86,97,840/- As directed, a show cause notice issued to the assessee on 05.04.2021. In response to the show cause notice, the assessee replied that bank statement has already been 33 ITA No. 21,22 & 23/RPR/2024 Om Bhoo Vikas Real Estate Pvt. Ltd. vs ACIT, Circle-1(1), Bhilai submitted for verification previously. However, assessee failed to furnish satisfactory explanation with evidence regarding the source of investment of such share capital. Therefore, share capital's entire amount of Rs. 71,15,890/- is added as unexplained cash credit u/s 68 of I.T. Act. 12.5 Aggrieved with the aforesaid addition u/s 68 of the Act, assessee preferred an appeal before the Ld. CIT(A), but was unable to convince the First Appellate Authority and, therefore, the appeal of the assessee has been dismissed with the following relevant observations: 4.4 The action of the Ld. AO and the circumstances which led to the completion of the impugned assessment order and the ground wise submission of the appellant which I have carefully perused and I find that merely because the amounts of share application / Share Premium money has been routed through banks, the assessee could not have been said to have discharged the onus cast upon him in the surrounding circumstances of the case. Such ratio emanates from the decision of the Hon'ble High Courts of Delhi in the case of CIT Vs Ultra Modern Exports (P) Ltd reported in [2013] 40 taxmann.com 458 (Delhi). The head notes in the said case are as under: [2013] 40 taxmann.com 458 (Delhi) HIGH COURT OF DELHI Commissioner of Income-tax Ultra Modern Exports (P.) Ltd.* S. RAVINDRA BHAT AND R.V. EASWAR, JJ. IT APPEAL NO. 262 OF 2012 34 ITA No. 21,22 & 23/RPR/2024 Om Bhoo Vikas Real Estate Pvt. Ltd. vs ACIT, Circle-1(1), Bhilai DECEMBER 11, 2012 Section 68 of the Income-tax Act, 1961 - Cash credits [Share application money] - Assessment year 2007- 08 - In course of assessment, Assessing Officer noticed that assessee received share application money from nine applicants - Upon enquiry, five out of nine notices issued to share applicants under section 133(6) were returned unserved - Furthermore, materials on record in form of returns of income of share applicants furnished by assessee disclosed that applicants had very meager income - In such circumstances, Assessing Officer added amount of share application money to assessee's taxable income under section 68 - Commissioner (Appeals) as well as Tribunal took a view that documentary evidence furnished by assessee such as PAN numbers, detailed particulars of addresses, audited accounts and bank statements of share applicants etc., sufficiently proved identity and creditworthiness of share applicants - Accordingly, addition made by Assessing Officer was deleted - Whether information that assessee furnishes would have to be credible and at same time verifiable - Held, yes - Whether in view of fact that notices to five share applicants returned unserved and still assessee was able to secure documents such as their income tax returns as well as bank account particulars, it would itself give rise to a circumstance in which Assessing Officer rightly proceeded to draw adverse inference - Held, yes - Whether, therefore, Commissioner (Appeals) and Tribunal fell into error in holding that Assessing Officer could not have added back said amount under section 68 - Held, yes [Para 91 [In favour of revenue] 4.17 From the assessment order, it is observed that the appellant was provided ample opportunity and principle of natural justice was also observed. Human probabilities, surrounding circumstance and preponderance of probability goes against the appellant. The ratio and observations in the case of Durga Prasad More( supra) and Sumati Dayal ( supra) and other case laws referred above, applies in the appellant's case. The appellant thus, failed to satisfy the all the three ingredients set forth as per decision of various courts including the Apex court, which cast onus on the assessee to prove the identity and creditworthiness of the person from whom the monies were taken and the genuineness of the transaction when money is found credited in the books of accounts of the assessee and failure to satisfy the same, provision of section 68 shall be invoked. The Ld AO has, thus, righty invoked section 68 and added Rs. 71,15,890/-, found credited in the books of the accounts of the appellant, under that section. 35 ITA No. 21,22 & 23/RPR/2024 Om Bhoo Vikas Real Estate Pvt. Ltd. vs ACIT, Circle-1(1), Bhilai 4.18 In view of the above discussion and relying upon the case laws mentioned above, I find no infirmity in the orders of the Ld. AO and I confirm the addition of Rs. 71,15,890/-. The case laws relied upon herein are distinguishable on the facts of the case and therefore, do not come in rescue of the appellant. The ground taken by the appellant, thus, stands dismissed. 12.6 Dissatisfied with the aforesaid decision by the Ld. CIT(A), the assessee is before us to consider its contentions in the present appeal. 12.7 On the issue, it was the submission by Ld. AR that all the necessary documents requisite to satisfy the conditions of section 68, so as to establish the identity, creditworthiness of the investors and genuineness of the transactions were produced before the revenue authorities. Details of such submissions, before the lower authorities are compiled in a chart which is submitted before us, the same is extracted hereunder: 36 ITA No. 21,22 & 23/RPR/2024 Om Bhoo Vikas Real Estate Pvt. Ltd. vs ACIT, Circle-1(1), Bhilai 37 ITA No. 21,22 & 23/RPR/2024 Om Bhoo Vikas Real Estate Pvt. Ltd. vs ACIT, Circle-1(1), Bhilai 38 ITA No. 21,22 & 23/RPR/2024 Om Bhoo Vikas Real Estate Pvt. Ltd. vs ACIT, Circle-1(1), Bhilai 12.8 Based on aforesaid submission, it was the prayer that the transaction of investment in the share capital and premium of the assessee company are genuine, the addition made by the Ld. AO is highly arbitrary, unjustified and unwarranted on the facts and circumstances of the present case, therefore, the same is liable to be deleted. 12.9 Ld. Sr. DR on the other hand vehemently supported the orders of Revenue Authorities, and have submitted that there was a complete failure on the part of assessee to furnish necessary information to establish the identity, creditworthiness of the investors and genuineness of the transaction, therefore, the addition made by Ld. AO was after proper appreciation of the fact and evidence on record, which the Ld. CIT(A) had rightly deliberated upon and decided against the assessee. It was, therefore, the prayer that the order of Ld. CIT(A) deserves to be sustained. 12.10 We have considered the rival submissions and perused the material available on record. On perusal of the list of documents submitted by the assessee in explanation to the identity, creditworthiness and genuineness of the investors / transaction, we found that, though the assessee had furnished certain documents pertaining to the investors but was unable to substantiate the requisite conditions as described in section 68 of the Act, to prove and explain the source of investment. 39 ITA No. 21,22 & 23/RPR/2024 Om Bhoo Vikas Real Estate Pvt. Ltd. vs ACIT, Circle-1(1), Bhilai Further, as per 1st proviso to Section 68, the assessee was duty bound to discharge the onus cast upon it to validate the nature and source of the person in whose names such credit (the present case share capital + premium) is recorded in the books of the assessee company. However, the assessee herein has never furnished any information qua the source of source in terms of provisions of clause (a) to 1st proviso to section 68 of the Act, which reads as under: Cash credits. 68. Where any sum is found credited in the books of an assessee maintained for any previous year, and the assessee offers no explanation about the nature and source thereof or the explanation offered by him is not, in the opinion of the Assessing Officer, satisfactory, the sum so credited may be charged to income-tax as the income of the assessee of that previous year : Provided that where the assessee is a company (not being a company in which the public are substantially interested), and the sum so credited consists of share application money, share capital, share premium or any such amount by whatever name called, any explanation offered by such assessee-company shall be deemed to be not satisfactory, unless— (a) the person, being a resident in whose name such credit is recorded in the books of such company also offers an explanation about the nature and source of such sum so credited; and (b) such explanation in the opinion of the Assessing Officer aforesaid has been found to be satisfactory: 40 ITA No. 21,22 & 23/RPR/2024 Om Bhoo Vikas Real Estate Pvt. Ltd. vs ACIT, Circle-1(1), Bhilai Provided further that nothing contained in the first proviso shall apply if the person, in whose name the sum referred to therein is recorded, is a venture capital fund or a venture capital company as referred to in clause (23FB) of section 10. 12.11 In backdrop of aforesaid facts and circumstances of the present case, we are unable to persuade to subscribe with the contentions raised by the Ld. AR on behalf of the assessee. Thus, in absence of requisite information to substantiate the conditions of Section 68, specially the 1st proviso to Section 68, which is inserted by the Finance Act, 2012, w.e.f. 01.04.2013, therefore, squarely applicable in present case pertaining to AY 2018-19, we are of the considered view that the order of Ld. CIT(A) in sustaining the addition made by the u/s 68 for Rs.71,15,890/- was justified and merits to be upheld. 12.12 Resultantly, Ground No. 1 in ITA 23/RPR/2024 of the assessee stands rejected. 13. Ground No. 2: It is a general ground having no further advancement of arguments or grievance, therefore the same become infructuous, thus, stands dismissed. 41 ITA No. 21,22 & 23/RPR/2024 Om Bhoo Vikas Real Estate Pvt. Ltd. vs ACIT, Circle-1(1), Bhilai 14. In result, ITA No. 23/RPR/2024 for the assessment year 2018-19 of the assessee has been dismissed in terms of our aforesaid observations. 15. In combined result, ITA No. 21 & 22/RPR/2024 are partly allowed for statistical purposes and ITA No. 23/RPR/2024 has been rendered as dismissed. Order pronounced in the open court on 22/11/2024. Sd/- (RAVISH SOOD) Sd/- (ARUN KHODPIA) Ɋाियक सद˟ / JUDICIAL MEMBER लेखा सद˟ / ACCOUNTANT MEMBER रायपुर/Raipur; िदनांक Dated 22/11/2024 Vaibhav Shrivastav आदेश की Ůितिलिप अŤेिषत/Copy of the Order forwarded to : आदेशानुसार/ BY ORDER, (Senior Private Secretary) आयकर अपीलीय अिधकरण, रायपुर/ITAT, Raipur 1. अपीलाथŎ / The Appellant- Om Bhoo Vikas Real Estate Pvt. Ltd. 2. ŮȑथŎ / The Respondent-ACIT, Circle-1(1), Bhilai 3. आयकर आयुƅ(अपील) / The CIT(A), 4. The Pr. CIT, Raipur (C.G.) 5. िवभागीय Ůितिनिध, आयकर अपीलीय अिधकरण, रायपुर/ DR, ITAT, Raipur 6. गाडŊ फाईल / Guard file. // स×याǒपत Ĥित True copy // "