TaxTMI 
TaxTMI 
2014 (10) TMI 782
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....he CIT (A) has erred in law and on facts of the case in allowing claim of the assessee that investments of Rs. 8,80,000/- were made out of advance received from Mehboob Alam against sale of property. This alleged transaction is not genuine as the assessee was not owner of the property in question. The assessee also failed to provide Shri Alam's address. Therefore, the indentity and capacity could not be verified. 5. The CIT (A) has erred in law and on facts of the case on treating investments of Rs. 2.50 lakhs as being explained as having been made put of cash loan taken from Mohd. Naseem Mansoori. This person resides in Abu Dhabi and there is no evidence available with the assessee that he had these funds available with him in India for making this loan. Therefore the genuineness of the transaction is not proved and the addition made by the AO deserves to be restored. 6. The CIT(A) has erred in law and on facts in accepting that investments of Rs. 21,43,986/- was made by redemption of investment in earlier years, even though the assessee had failed to provide any evidence for the same before the A.O. 7. The CIT(A) has erred in law and on facts in accepting the claim o....
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....cer, it was of Rs. 27,67,236/-, whereas the assessee has accepted the investment of Rs. 10 lakhs. The difference was explained by the assessee that it was caused by switching over from one investment to other i.e. same investment being rotated over a period of time from one scheme of the fund to the other. While the Assessing Officer has taken the investment as the cumulative figure, but the assessee has taken the figure of investments actually made, as the switches are included in the investments originally made. The Assessing Officer noted the details of investments in 26 schemes from the TATA Assets Management, but without examining the claim of switch over from one scheme to other, the Assessing Officer has worked out the total investment of Rs. 27,65,237/-. According to the assessee, the details were filed before the Assessing Officer, but he has not looked into it and taken the cumulative figure of investment in TATA Assets Management. The ld. CIT(A) took cognizance of these switch over of investments and having verified from the details, he accepted the contention of the assessee that the total investment was of Rs. 43,40,457/- as against Rs. 61,09,693/- taken by the Assessi....
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....ssessee but while making the addition the figure inadvertently haS been taken as Rs. 2,88,757/-. The investment in HDFC Mutual fund is therefore accepted as Rs. 2,86,757/-. 7(1)(iii) The only other difference in with regard to investments made with TATA Assets Management. The AO has found investments of Rs. 27,67,236/- whereas the assessee has accepted the investments of Rs. 10,00,000/-. It is therefore imperative to examine this difference. The assessee has submitted that the difference has been caused by switches i.e. the same investment being rotated over a period of time from one scheme of the fund to the other. While the AO has taken the investment as the cumulative figure, the assessee has taken the figure of investments actually made as the switches are included in investments originally made. The AO acquired the details of investments in 26 schemes from the TATA Assets Management. The total investment worked out to Rs. 27,65,237/- without considering the switches from one scheme to the other. The investment made before and after the switch from one scheme to another included in these 26 schemes. The figure has been takers by the AO at Rs. 27,67,236/-resulting in a totali....
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.... It is Switch in from TATA SIP Fund Scheme 1-Growth and amount is Rs. 47,167.20/- 8 2,62,040 1969584 It is Switch out from TATA SIP Fund Scheme 1- Growth , amount is Rs. 47,167/-. 9 2,62,040 1716213 It is a switch in folio number 1496319 TATA pure equity PE fund growth from TAAT SIP 21 47,167.2 2023622 It is Switch in from Folio No. 1483191/11 TATA Sip Fund 1 Growth to TATA Select equity Fund 23 50,000 1483191 Switch out to TATA AIG amount is Rs. 36,598 24 1,00,000 1496319 Switch out to TATA AIG amount is Rs. 2,05,003.27 25 1,00,000 1496321 It is Switch out to TGEIAG and amount is Rs. 1,98,824.08 Total Rs. 18,80,087.43 7(2)(iii) The total of investments as per list of 26 schemes obtained by the AO from the TATA Assets Management is Rs. 27,65,237.86. The total of investments without considering the switches as tabulated in first table is Rs. 8,85,150.2. The total investments comprised in the switches i.e. switch from one scheme to another also included in the list obtained by the AO as tabulated in second table is Rs. 18,80,087.43. The two tables above total at Rs. 27,65,237.63. In other wo....
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....he Assessing Officer, the Revenue should have taken a ground with regard to the violation of Rule 46A of the Income Tax Rules. Moreover, from the details furnished before us, the assessee has given a certificate that these evidences were filed before the Assessing Officer and the certificate was not disputed by the ld. D.R. In the light of these facts, we are of the view that the details were available before the Assessing Officer and before making addition in this regard, the material should have been examined by him; whereas the ld. CIT(A) has carefully examined the details of investment from one scheme to the other and finally concluded that actual investment in TATA Assets Management was Rs. 10 lakhs and not Rs. 27,67,236/- as adopted by the Assessing Officer. Therefore, we find no infirmity in this regard and we accordingly confirm the order of the ld. CIT(A). 9. The next issue relates to the source of investment in the aforesaid investments made by the assessee. 10. The Assessing Officer has already allowed benefit of Rs. 9,28,179/- as known source of investment. The ld. CIT(A) required the assessee to explain the total source of investment of Rs. 43,40,457/- for which ....
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....rawal of Rs. 3 lakhs from the G.P.F. account was made for construction of the house, therefore, this amount cannot be invested in TATA Assets Management. 14. This source of investment was accepted by the ld. CIT(A) on the ground that after completing 20 years of service, assessee was entitled to make withdrawal from his G.P.F account and it is irrelevant whether assessee has withdrawn the same for construction of the house or not and he has also observed that the house was not constructed. These observations of the ld. CIT(A) while deleting the addition does not appears to be convincing, as the withdrawal from the G.P.F. was made for a particular purpose i.e. for construction of the house and no evidence was placed either before him or us that the assessee has not constructed any house. Before the Assessing Officer, assessee has not disclosed withdrawal from G.P.F. as one of the source of investment. This stand was taken for the first time before the ld. CIT(A) and the ld. CIT(A), without verifying the facts, has accepted the claim of the assessee. We, therefore, do not agree with the findings of the ld. CIT(A) and accordingly we set aside the order of the ld. CIT(A) on this iss....
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....ansaction to be bogus and did not accept receipt of Rs. 8.80 lakhs as one of the sources of investment. 18. The ld. counsel for the assessee, on the other hand, has placed heavy reliance upon the order of the ld. CIT(A). 19. Having given a thoughtful consideration to the rival submissions and from a careful perusal of the orders of the authorities below and the so called sale agreement appearing at pages 86 to 94 of the compilation of the assessee, we find that this document was executed on a plain paper and it is a fake document, as it is not properly legible. It is important to note here that in Uttar Pradesh, agreement for sale of immovable property is required to be registered under the Indian Registration Act, of which Stamp Duty is required to be paid. It is also an important factor that only that property can be sold which is owned by the seller. In this case, the Assessing Officer has raised a specific query from the assessee to produce the ownership document of the property which is proposed to be sold by the assessee, but the assessee did not place the ownership document before the Assessing Officer. Similar is the position before us and the ld. CIT(A). He simply pl....
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....ccepted the claim of the assessee. 24. Having given a thoughtful consideration to the rival submissions and from a careful perusal of the documents, we are of the view that the Assessing Officer has not discussed with regard to filing of this confirmation before him in the assessment order. The ld. CIT(A) has taken cognizance of this confirmation and without making any verification with regard to this document, he accepted the claim of the assessee. Even proper local address of Mohd. Naseem Mansoori has not been mentioned on this document. Some email address is given on this confirmation without having residential address of the creditor. A reference was made to Abu Dhabi. In a situation where no local address has been given, how a person of resident of Abu Dhabi has extended loan in cash to the assessee for settlement of his insurance policy. The assessee ought to have furnished some evidence as to which date and what time the loan and cash was given to him and he should have also filed evidence of the availability of Mohd. Naseem Mansoori in India at the relevant point of time, as the loan was given in cash. Otherwise, a loan cannot be given in cash from an NRI living in abroa....
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....of assessee's bank account, he should have allowed the benefit of the same. The amount of Rs. 19,95,279/- is mentioned in respect of three bank accounts with ICICI Bank (Rs.69,239/-), IDBI Bank (Rs.3,60,356.1) and Citi bank (Rs.15,65,684.9) in the assessment order. When the amount was available as per bank accounts, the amount should have been accepted towards known sources of income. However, the appellant has submitted the details of redemption from following investments on the basis of their credits in the bank accounts (A) Citi Bank S.No. Name of Mutual Fund Amount Date of credit in Bank (i) Redemption on 24/7/2007 from DSP Small and Mid Cap fund (Date of Purchase -14/11/2006 for Rs. 50,000/-) 58,426.13 27/07/2007 (ii) Redemption On 10.9.2007 from Frank Flexi Cap India oppur.(Date of purchase :5/4/05 for Rs. 25,000/-,13/10/05 for Rs. 25,000/-,20/12/2005 for Rs. 50,000/-) 1,42,667.00 13/09/2007 (iii) Redemption on 10/9/2007 from Frank India Prima Fund (Purchases done through SIP from April 2005) 2,31,339.55 13/09/2007 (iv) Redemption on 10/9/2007 from HDFC Equity Fund (Purchases done through SIP from April 2005) 2,7....
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....Rs. 1,00,000. Redemption date 26/12/2007) 118,051.19 31/12/2007 (vi) Redemption SBI MF :6/7/2007 purchase for Rs. 45,000 date of redemption 26/12/2007 64,503.00 31/12/2007 (vii) Redemption of Fidelity Mutual Fund : 21/03/2004 purchase for Rs. 50,000/- 67,174.31 08/01/2008 (viii) Redemption from SBI Mutual Fund Date of purchase 24/11/2005 date of redemption 24/7/2007 72,441.40 03/08/2007 TOTAL 7,45,552.03 TOTAL 23,31,472.98 7(4)(viii)(b) I find that out of Redemption of the aforesaid Mutual Funds of Rs. 23,31,472.98 in the year under consideration, the redemption of Rs. 1,87,486.70 was out of investment made in the current year and redemption of Rs. 21,43,986.28 was out of the investment made in the earlier years as is evident from the dates given above. Investments made in the earlier years cannot be added as the income of the year under consideration. So far as investment of the year under consideration is concerned, it is out of income/receipts as discussed above. The three bank accounts of the assessee maintained with ICICI bank, IDBI Rank and Citi bank were examined by the AO. The interest thereon has been added to the in....