2012 (4) TMI 321

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....der dated 31.3.2006 has made addition of Rs.12,91,432/- in the income of the assessee as an unexplained investment. The assessee had purchased a immovable property for payment of consideration of Rs.5 lacs as was recorded in the sale deed. The Assessing Officer obtained the report from DVO who had estimated the value of the property at Rs.17,91,432/-. After receiving the valuation report , the Assessing Officer observed that the difference of the value is unexplained investment and no satisfactory explanation having been given by the assessee. An appeal was filed by the assessee to the CIT(A) who vide order dated 19.3.2007 has partly allowed the appeal. In so far as the addition of Rs.12,91,432/-, the appellate authority has held in paragra....

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.... made by the Assessing Officer and Appellate Authority committed error in setting aside the said order. The learned counsel for the Department submitted that the said amount was unexplained investment within the meaning of Section 69 of the Income Tax Act, hence has rightly been added in the income of the assessee . He submits that the fact that the DVO has estimated the value of the property at Rs.17,91,432/-. It is clearly indicated that the property was owned by the assessee and the difference was liable to be added as unexplained investment. Refuting the submissions of the learned counsel for the Department, the learned counsel for the assessee submitted that the mere fact that the report was received by DVO that the value of the pro....

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.... the investments may be deemed to be the income of the assessee of such financial year. " The bone of contention between the parties is the sale deed in question which has recorded sale consideration of Rs.5 lacs. The mere fact that the DVO has reported value of the property as 17 lacs does not ipso facto leads to the conclusion that unexplained consideration of above Rs. 5 lacs was actually paid by the assessee. The Appellate Authority has rightly recorded that in the present case, the seller of the property even was not called by the Assessing Officer nor there was any material to come to a conclusion that the amount which has been added in the income was actually paid by the assessee. The appellate authority has observed that the burd....