TaxTMI 
TaxTMI 
2023 (11) TMI 327
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....8 of Income Tax Act. Thus all the proceedings are void & bad in law. 2. That on the facts and circumstances of the case the Learned Assessing Officer has erred in treating unexplained Investment of the Assessee to the extent of Rs. 1,10,82,319/- without verifying the fact of Registry the payment made in earlier year(Jaipur Flat) and Amount not paid during the year /payable on next year (Pune Flat) have estimated as unexplained Investment u/s 69 of Income Tax Act and levied Tax u/s 115BBE of Act is against Law & Facts of the Case. 3. That the Income of Deceased person is added in the income of Humble Appellant is against the Law. 4. That all the Purchase Agreements / Deeds & Payment made through Account Payee Cheques which are verified by Ld Assessing Officer, Thus no Question of Section 69 arises. 5. That Without prejudice to above the Learned Assessing Officer levied 60% Tax instead of 30% against the provision of Law. 6. That the CIT (A) grossly eared in not considering the withdrawal Application filed before DCIT (DRP-1), Delhi (Sec) & rejected the Appeal without considering the Facts. 7. That on the facts and circumstances o....
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....nt made for purchase of the aforementioned immovable properties. The same was furnished by the assessee vide submissions dated 07.02.2022, 09.03.2022 & 21.03.2022. Regarding the source of investment for purchase of the properties mentioned above. The ld. AO noted that the assessee has not produced any documentary evidence regarding the payment of Rs. 52,37,475/- (11881300-6643825). Also, the assessee has claimed that this payment of Rs. 52,37,475/- was made by his father, Mr. Nanak Gurbani. Also, assessee is the sole owner of this property and claiming that he has only made payment of Rs. 66,43,825/- and rest of the payment is made by his father Mr. Nanak Gurbani. The ld. AO noted that the assessee failed in furnishing documentary evidence regarding the capacity of payment of his father and relevant bank a/c statements have also not been furnished by the assessee. Hence, the source of investment of Rs. 52,37,475/- is considered as unexplained. The ld. AO contended that the possibility of the fact that whole of the invested amount is originally transferred by Mr. JaiKumar Gurbani into the bank a/c of Mr. Nanak Gurbani also cannot be denied considering that the account balance of Mr.....
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....ued a Draft Order u/s 144C of the Act on 27.03.2022. In response to the same, the appellant approached Dispute Resolution Panel and filed application before DRP-1, Delhi on 26.04.2022. 6. There is no dispute in law that on receipt of a draft order u/s 144C proposing variations to the returned income, the assessee can either accept the variations or file an objection before the DRP. In the alternative, the assessee also has the option to prefer appeal before the Commissioner of Income Tax (Appeals). Undisputedly, the assessee cannot both file objections before the DRP and also file the appeal before CIT(A). In this case, as the appellant had already preferred filing objections before the DRP, he did not have any legal right to file an appeal before the CIT(A). Clearly, the appeal filed before the CIT(A) was not maintainable in law. Therefore, the appeal deserves to be dismissed being not-maintainable in law. 7. As mentioned earlier, the appellant has filed an application under Rule 46A of Income Tax Rules, 1962 for admission of certain additional evidences. As already discussed, the present appeal is found to be not maintainable, therefore, there is no question of ....
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....rned Assessing Authority further issued Show Cause Notice on Dt 01-03- 2022 for addition on Investment of Rs. 2,10,45,648/- and given hearing Dt 16- 03-2022 further The Learned AO Circle (Int. Tax) Jaipur issued show cause Notice on Dt 08-03-2022 for hearing date 11-03-2022. That Humble Appellant in response to Notice 01-03-2022 submitted the Reply & statement of account of Builder M/s Nahar Homes and copy of Bank account of Late Sh. Nanak Gurbani on Dt 16-03-2022. The Learned Assessing Officer, Circle (Int. Tax) Jaipur have issued Notice on Dt 19-03-2022 for hearing Dt 04-04-2022 asking to provide evidence/ source for deposits of Rs. 99,81,115/- in Account Number 00541060001672 and issued notice of unexplained investment of Rs. 1,18,81,300/-as Income of the year but accepted Rs 2,10,45,648/-. The Humble Appellant submitted the information and also submitted copy of Bank Statement, Remittance Certificate alongwith Salary Certificate of Overseas Employer on Dt 04-04-2022. The Learned Assessing Officer, Circle (Intel. Tax) Jaipur have issued Draft Order u/s 144C of income tax act on dated 27-03-2022 for Addition of Rs. 1,10,82,319/- estimating Total Income of Rs. 1,13,32,750/- ....
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....ssessment proceedings. The Humble Appellant had filed following documents in connection to above said property purchase:- i) Agreement of the assessee with the developer to purchase said property. ii) Account statement of the Humble Appellant provided by M/s.Nahar Homes LLP, developer of above project Both the above documents prove that the agreed sale consideration for above property is Rs. , 1,18,81,300 + Service Tax, out of which during the previous year relevant to this concerned Assessment Year the Humble Appellant had made payment of Rs. 66,43,825 only which is verified by Learned Assessing Officer and rest of the payment has been made in subsequent year(s). The Humble Appellant has even proved the source of payment of above said sum which was made through three cheques for Rs. 5,00,000, Rs. 20,00,000 and Rs. 41,43,825 respectively and no objection was ever raised by Learned Assessing Officer there on during the assessment proceedings. The Humble Appellant has nowhere claimed about payment by Shri Nanak Gurbani for above said property. This property was purchased by the Humble Appellant as sole owner only and there was no body as co-buyer of the same. ....
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....d he had filed his ITR for the AY 2017-18 on 11-11-2017. Shri Nanak Gurbani was partner in one M/.s Jay Pee Industries and he had received Partners Remuneration of Rs. 1,50,000 and interest on Partner's Capital at Rs. 2,96,282 from the above named firm. Shri Nanak Gurbani had unfortunately expired on Dt 09-03-2019. The ITRV and computation of income of Shri Nanak Gurbani for the AY2017-18 has been submitted before the Learned Assessing Officer to justify the source of payment of said sum of Rs. 6,41,920/-, the Additions made in Appellant case is against Facts & Law. Unexplained investment by calculating 50% of the total agreed sale consideration of Rs. 91,64,348 ie Rs. 45,82,174/- That the Learned Assessing Officer suomoto treated Rs. 45,82,174/-as unexplained investment by estimating 50% of the total agreed Purchase consideration of Rs. 91,64,348 for the property situated at Shiv Marg, Banipark, Jaipur. The Learned Assessing Officer has himself agreed in draft order that the Humble Appellant has claimed that whole amount for the purchase has been paid by Shri Nanak Gurbani and in absence of proving capacity of father of the Assessee Shri Nanak Gurbani 50% of the agreed sale....
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....ellant had not claimed that whole Purchase consideration was paid by Shri Nanak Gurbani. It was only regarding the payment of Rs. 1,71,744/- made during the relevant previous year. The Learned Assessing Officer have not Verified / Examined copy of Registry & Facts stated. That as per Section 69 "Where in a year the taxpayer has made investments which are not recorded in the books of account, if any, maintained by him for any source of income, and he offers no explanation about the nature and source of the investments or the explanation offered by him is not, in the opinion of the Assessing Officer, satisfactory, than the value of the investments may be deemed to be the income of the taxpayer of such year". Since the Humble Appellant has proved nature & source of Investments as appeared in both the Registry executed during the year of Flat, Thus the value of Investments cannot be treated as Income of the Taxpayer. The humble Appellant and his Father Late Shri Nanak Gurbani (co-owner in Jaipur Flat) have given Payment through Account Payee Cheques, submitted the Death Certificate of Late Shri Nanak Gurbani Ji, Purchase Agreement & Registries - the Learned Assessing Officer made....
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....at as per Order Sheet Dt 26-04-2022 the learned AO have accepted that the Assessee have Filled Objections but in Order Sheet Dt 13-05-2022 -no response received by the Assessee. That the Dispute Resolution Panel have not informed the Learned Assessing Officer DCIT, CIRCLE (INTL TAX), JAIPUR. That on receipt of Assessment Order the Humble Appellant have no other alternate remedy except to file the Appeal before CIT (A) within Limitation Period. That the Hon'ble CIT (A) fixed the case for hearing and the Humble Appellant have submitted Reply and Paper Book on Dt 21-08-2022 before Learned CIT(A). That Learned CIT(A) issued Letter to Learned Assessing Officer DCIT, CIRCLE (INTL TAX), JAIPUR to furnish Report and the Learned Assessing Officer DCIT, CIRCLE (INTL TAX), JAIPUR have furnished Report on Dt 09-09-2022 and also sent us on 20-09-2022 to file the Objections on or before 28-09-2022. That in the meantime DCIT (DRP-1), Delhi (Sec) issued Notice Vide DIN & Letter No. ITBA/DRP/F17/2022-23/1045473154(1) Dated 14-09-2022 for Hearing Date 27-09-2022. That the Humble Appellant filled an Application on Dt 22-09- 2022 for withdrawal for the said Application filled before DRP, s....
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....has erred in initiating the penalty under section 270A of the Act- "Interlinked with Ground-1 to 7". 10. That on the facts and circumstances of the case the ld. AO has erred in initiating the penalty under section 271AAC(1) of the Act- "Interlinked with Ground-1 to 7". 11. That on the facts and circumstances of the case the ld. AO has erred in initiating the penalty under section 272A(1)(d) of the Act. - "Interlinked with Ground-1 to 7". 12. That further submissions in support of appeal shall be made at the time of hearing. 13. That appellant craves leave to add, amend or alter all or any grounds of appeal before or at the time of hearing. Written Submission:- I. That Learned Assessing Authority grossly erred in Law issuing Notice u/s 148 of Income Tax Act without verifying the facts shown Investment of Rs. 3,29,26,948/- taken twice amount of Registry & TDS Return and have not verified the amount of Registry before issue of Notice & have not applied his mind for opening the Case u/s 148 of Income Tax Act. Thus all the proceedings are void & bad in law. That the case of humble Appellant was reopened u/s 148 on the reasons:- ....
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....aped assessment - It was noted that during assessment proceedings, assessee had brought on record assessment orders in case of co-owners of land where identical valuation and declarations were accepted - Assessing Officer had no iota of information to believe that cost of acquisition of property claimed by assessee at a particular rate was not quite accurate - Whether, on facts, notice for reopening of assessment was based on reasons which were product of non-application of mind; therefore, deserved to be quashed - Held, yes [Paras 9 and 11][In favour of assessee]" ii) That the Hon'ble HIGH COURT OF PATNA in case of Ravindra Kumar (HUF) @ Rabindra Kumar (HUF) v. Commissioner of Income-tax, Bhagalpur*[2019] 110 taxmann.com 58 (Patna) held that "Section 2(1A), read with section 148, of the Income-tax Act, 1961 - Agricultural income (Reassessment) - Assessment year 2011-12 - Assessee filed its return of income showing agricultural income of certain amount - Same was accepted and an assessment order was passed - Later on, Assessing Officer noted that an advisory was issued by department wherein Assessing Officer was directed to thoroughly verify claims in respect of agricultur....
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....ade merely to harass it - Held, yes - Whether since Assessing Officer had re-opened assessment on arbitrary and flimsy grounds and no addition was made on strength of such reasons, Commissioner (Appeals) was justified in quashing reassessment proceedings - Held, yes [In favour of assessee]" iv) That the Hon'ble IN THE ITAT DELHI BENCH 'B' (THIRD MEMBER) in case of Assistant Commissioner of Income-tax, Circle 11(2) v. O.P. Chawla* [2008] 114 ITD 69 (Delhi) (TM) held that "Section 147, read with section 148, of the Income-tax Act, 1961 - Income escaping assessment - General - Assessment year 1995-96 - Whether fact that notice of reopening was not prompted by a mere change of opinion cannot save said notice if Assessing Officer had no 'reason to believe' but had only 'reason to suspect' that income chargeable to tax had escaped assessment - Held, yes - Whether an attempt on part of Assessing Officer to probe into return further, without any fresh facts or change in law coming to his notice, would be a case of 'reason to suspect' and not 'reason to believe' - Held, yes - Assessing Officer processed under section 143(1)(a), return filed b....
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....estment of Rs. 52,37,475/- That the Property situated at Pune being flat no. A1-1701,F Residencies, Village Balewadi, High Street, Balewadi, Baner Link Road, Pune- 411045 (Maharashtra). The quantum of this alleged unaccounted investment has been worked out by deducting Rs. 66,43,825 out of agreed sale consideration of Rs. 1,18,81,300. While raising this allegation the Learned Assessing Officer has framed opinion that whole of the agreed sale consideration of Rs. 1,18,81,300 was paid by the assessee during the concerned year itself. The allegation of making an unaccounted investment of Rs. 52,37,475/-seems to has been raised by ignoring all the documents submitted by the Humble Appellant in the assessment proceedings. The Humble Appellant had filed following documents in connection to above said property purchase:- i) Agreement of the assessee with the developer to purchase said property. ii) Account statement of the Humble Appellant provided by M/s.Nahar Homes LLP, developer of above project Both the above documents prove that the agreed sale consideration for above property is Rs. , 1,18,81,300 + Service Tax, out of which during the previous yea....
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....made certain addition on assessee-transporter's income, considering difference of cost of building and interest of previous year as 'unexplained investments' - Assessing Officer had not considered details of expenses incurred by assessee for previous year - Whether matter was required to be reconsidered by Assessing Officer afresh, after providing an opportunity to assessee to explain expenditure incurred by him for previous year - Held, yes [Para 4] [Matter remanded]" iii) The Hon'ble THE ITAT KOLKATA BENCH 'SMC' in case of Ashutosh Jha v. Income-tax Officer, Ward 2(5), Ranchi* [2021] 129 taxmann.com 204 (Kolkata - Trib.) IN held that "Section 56 of the Income-tax Act, 1961 - Income from other sources - Chargeable as [Sub-section (2)(vii)(b)] - Assessment year 2014-15 - Assessee entered into an agreement for purchase of a property and made part payment for purchase through cheque on very next day after date of execution of agreement - Registry was done after a year - Assessing Officer made addition on account of difference between amount of sale consideration shown in agreement and stamp value of property noting that as per section 56(2)(vii)(b) value ....
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....and was liable to be deleted - Held, yes" We therefore request you to kindly accept the Ground of Appeal. b) Stamp Duty of Rs. 12,62,670/- No such evidence was ever sought from the Humble Appellant during the assessment proceedings. Right from initiation of the assessment proceedings the Learned Assessing Officer had been raising queries about the investment of the quantum which was made the basis of initiation of reassessment proceedings and the Assessee had submitted all relevant documents in connection thereto. The Assessee had made following payments for registration of sale deeds/ Agreements:- A. For property at Pune Rs. 7,44,060/- (Taken by Learned Assessing Officer Rs. 7,12,900/-) B. For property at Bani Park, Jaipur Rs. 6,41,920/- ( Taken by Learned Assessing Officer Rs. 5,49,770/-) Regarding payment of Rs. 7,44,060 in respect of stamp duty of property situated at Pune is concerned a sum of Rs. 7,42,900 was paid by the developer and the same has been debited by the developer on Dt 11-02-2017 in the Account Statement of the Humble Appellant. Even in the Registered Agreement also in par....
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.... completed reassessment wherein he only made addition of Rs. 3.50 lakhs being stamp duty incurred for purchase of immovable property as unexplained investment - It was noted that admittedly Assessing Officer had not made any addition on account of purchase of immovable property amounting to Rs. 49.97 lakhs meaning thereby he had accepted source of that huge amount - So far as amount towards stamp duty was concerned, it was found that property was owned by assessee jointly with his wife, namely, VB and said entire amount towards stamp duty was actually paid by VB and said fact was also brought forward before Assessing Officer - Assessing Officer had himself given a finding that VB had made cash payment towards stamp duty as per records maintained by seller of property - Therefore, there was no reason for making addition in hands of assessee - Whether, on facts, impugned addition made in hands of assessee was to be deleted - Held, yes [Para 13] [In favour of assessee]" ii) That Hon'ble ITAT JODHPUR BENCH in case of Om Prakash Joshi v. Income-tax Officer* [2009] 34 SOT 33 (Jodhpur) (URO) held that "Section 69 of the Income-tax Act, 1961 - Unexplained investments - Assessment ....
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....Kumar Gurbani Bank of Baroda Vidhyadhar Nagar 5 319110 31-12-2012 22,50,000 ICICI Bank LTD. (Home Loan Account of Nanak Gurbani) 6 319300 16-01-2013 22,50,000 ICICI Bank LTD(Home Loan Account of Nanak Gurbani) 7 000033 02-07-2015 5,52,902 HDFC Bank Ltd. C-Scheme Account of Jai Kumar Gurbani 8 000032 02-07-2015 4,65,750 HDFC Bank Ltd. C-Scheme, Account of Jai Kumar Gurbani 9 000139 05-09-2016 1,71,744 Bank of Baroda VKIA Jaipur, Account of Nanak Gurbani Total 94,40,396 Total Sum Paid From the above all the payment is made in earlier year by the Appellant & his father out of Home Loan granted by ICICI Bank. Note:- The Cheque of Rs. 1,71,744/- includes TDS of Rs. 91,644/- which has been deposited by seller on behalf of buyer. That during the year under consideration the buyers of the property had paid only Rs. 1,71,744/- which was paid from the bank account of Shri Nanak Gurbani and in support of the same copy of the bank statement of Shri Nanak Gurbani was also submitted to the learned Assessing officer and rest of the payments had been made in years earlier to relev....
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....DELHI Commissioner of Income-tax- XIV v. Vivek Aggarwal* [2015] 56 taxmann.com 7 (Delhi) held that "Section 69, read with section 158BB of the Income-tax Act, 1961 - Unexplained investments (Purchase of property) - Block assessment years 2001-02 to 2007-08 - Assessee purchased a property for a consideration of Rs. 3.70 lakh - During course of block assessment proceedings, Assessing Officer rejected transaction value and referred matter to AVO who in his report valued property at Rs. 10.65 lakh - Accordingly, addition of Rs. 6.95 lakh was made to assessee's income - Tribunal, however, set aside said addition - Whether in absence of any incriminating evidence with respect to payment over and above reported amount, it could not be concluded that transaction relating to property in question was undervalued, and, therefore, impugned order deleting addition was to be confirmed - Held, yes [Para 17] [In favour of assessee]" iii) The Hon'ble IN THE ITAT COCHIN BENCH M.M. Sulaiman v. Assistant Commissioner of Income-tax* [2014] 51 taxmann.com 310 (Cochin - Trib.) held that "I. Section 69, read with sections 132 and 153A, of the Income-tax Act, 1961 - Unexplained investments (Pr....
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.....22 acres of plots were sold, Assessing Officer in computing gains, deducted cost pertaining to 83.22 acres - Assessee's case was that 18.28 acres of land was used for creating internal roads for converting land into plots, hence entire cost of Rs. 101.50 acres was to be deducted - Since, assessee's claim of compensation of 18.28 acres of land for creating internal roads was not substantiated, Commissioner (Appeals) deducted an additional amount of Rs. 5 lakhs towards roads - Whether, there was no infirmity in order of Commissioner (Appeals) - Held, yes [Paras 29.1 & 29.2] [Partly in favour of assessee] VI. Section 69, read with section 153A, of the Income-tax Act, 1961 - Unexplained investments (Purchase of property) - Assessment year 2004-05 - Whether assessee had reconciled payments made for purchase of rubber estate and assessee's explanations were supported by statements given by person from whom he had taken money, as well as by letter given by bank which issued demand draft, additions were rightly deleted by Commissioner (Appeals) - Held, yes [Para 30.6] [In favour of assessee] VII. Section 69 of the Income-tax Act, 1961 - Unexplained investments (Purchase of car....
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....yers had given a sum of Rs. 3.42 crores to assessee - Receipt mentioned about 'payment due' and not actual payment, where as revocation agreement mentioned about actual payment made - Whether, premium amount had to be taken as Rs. 3.42 crore only, as mentioned in revocation agreement - Held, yes [Para 52] [In favour of assessee]" iv) The Hon'ble SUPREME COURT OF INDIA in case of KishinchandChellaramv. Commissioner of Income-tax* [1980] 4 Taxman 29 (SC) held that "Section 23(3) of the Indian Income-tax Act, 1922 [Corresponding to section 143(3) of the Income-tax Act, 1961] - Assessment - Income from undisclosed sources - Employee of one office of assessee made, through a bank, telegraphic transfer of certain amount to employee of another office - ITO, on the basis of letters from bank manager, not shown to assessee, treated amount so remitted as income from undisclosed sources - Tribunal, relying on letters of bank manager, upheld ITO's action - Whether tribunal justified - Held, on facts, no - Whether burden of proof lay on department to show that remitted amount belonged to assessee by bringing proper evidence - Held, yes" v) That the Hon'ble THE ITAT....
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....sources of income in India - Whether there was no case of undisclosed income in respect of understatement of purchase consideration since entire 'onmoney' payments made against all purchases were covered by NRE remittances sent by assessees - Held, yes - Whether there is any scope for general estimation in block assessment in absence of specific and speaking materials - Held, no - Whether generally in a block assessment estimated additions cannot be justified - Held, yes - Whether there being no incriminating materials to prove that assessees had expended money in excess of amount admitted by them to have been spent for constructing various buildings and also no evidence in support of estimates made by Assessing Officer in respect of personal expenses and agricultural income, additions were unjustified and unsustainable and, consequently, there was no case of undisclosed income - Held, yes" vii) The Hon'ble HIGH COURT OF GUJARAT in case of Income-tax Officer v. Bharat A. Mehta* [2015] 60 taxmann.com 31 (Gujarat) held that "Section 69 of the Income-tax Act, 1961 - Unexplained investment (Investment in property) - Assessment year 1992-93 - Assessee purchased a bunglow in a h....
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....uine - Held, yes [Para 7][In favour of assessee]" We therefore request you to kindly accept the Ground of Appeal. III. That the Income of Deceased person is added in the income of Humble Appellant is against the Law. That the case of the Humble Appellant was reopened on the basis of :- "As per data available on the ITBA portal classified under Multi Year NMS category, it is found that the assessee had made financial transactions of Rs. 3,29,27,436/- during the F.Y. 2016-17 and not filed return of income for the A. Y. 2017-18. The detail of the financial transaction made by the assessee during the F.Y. 2016-17 is as under :- 1. Payment made in respect of transfer of immovable property (TDS Form 26QB, Section 194IA amounting to Rs. 1,18,81,300/- 2. Purchase of immovable property amounting to Rs. 21045648/- 3. TDS Return - payment to Non-residents(Section 195) amounting to Rs. 488/- " (Refer Page No. 8 & 37 of Supplementary Paper Book Dt 15-05-2023) That the Learned Assessing Officer issued Show Cause Notice on Dt 19- 03-2022 (Refer Page No. 31 of Supplementary Paper Book) wherein Accepted 2,10,45,648/- & proposed the Addi....
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....7-18 and filed ITR only in response to the notice u/s 148 of the Act, hence, TDS credit is hereby disallowed. [Addition:- Rs. 1,10,82,319/-] Penalty u/s 271AAC(1) r.w.s. 115BBE is initiated separately on this issue. 5.2 During the year the assessee has earned interest on saving Bank a/c total amounting to Rs. 488/- which has not been declared by the assessee in computation/ITR submitted, hence, the same is hereby added to the total income of the assessee. [Addition: Rs. 488/-] Para wise reply as per below:- 1. In this regard we like to inform that the Humble Appellant have paid only Rs. 66,43,825/- & the rest payment is payable in future Years as per payment schedule (refer page No 70 of Main Paper book), thus the remarks were incorrectly made. 2. No such evidence was ever sought from the Humble Appellant during the assessment proceedings. Right from initiation of the assessment proceedings the Learned Assessing Officer had been raising queries about the investment of the quantum which was made the basis of initiation of reassessment proceedings and the Assessee had submitted all relevant documents in connection thereto. The Assessee had made ....
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....ficer, which is against the facts of the case- no notice is issued to Shri Nanak Gurbani. Who has expired on Dt 06-03-2019. 4. That we are submitting herewith payment schedule annexed to main Paper Book (refer Page No. 61) wherein the details of Payments were informed to learned Assessing Officer. Further the Learned AO while submitting Remand Report -refer Page No 4 of supplementary Paper Book para 6 is as under:- "this loan Account is in the name .......................hence, the additional evidence produced pertain s to the other half part of the Sale consideration paid by the assessee's father which is not a part of the addition made." 5.2 that the Humble Appellant has earned interest on saving Bank a/c total amounting to Rs. 488/- which has been declared by the assessee in computation/ITR submitted, hence, the interest is twice added to the total income of the assessee. That the Learned Assessing Officer suomoto treated Rs. 45,82,174/-as unexplained investment by estimating 50% of the total agreed Purchase consideration of Rs. 91,64,348 for the property situated at Shiv Marg, Banipark, Jaipur. The Learned Assessing Officer has himself agreed in....
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....en made in years earlier to relevant previous year. Thus the assumption to treat Rs. 45,82,174/-as unexplained investment of the Humble Appellant is incorrect & against the facts of the case. Further the Humble Appellant had not claimed that whole Purchase consideration was paid by Shri Nanak Gurbani. It was only regarding the payment of Rs. 1,71,744/- made during the relevant previous year. The Learned Assessing Officer have not Verified / Examined copy of Registry & Facts stated. That as per Section 69 "Where in a year the taxpayer has made investments which are not recorded in the books of account, if any, maintained by him for any source of income, and he offers no explanation about the nature and source of the investments or the explanation offered by him is not, in the opinion of the Assessing Officer, satisfactory, than the value of the investments may be deemed to be the income of the taxpayer of such year". Since the Humble Appellant has proved nature & source of Investments as appeared in both the Registry executed during the year of Flat, Thus the value of Investments cannot be treated as Income of the Taxpayer. The humble Appellant and his Father Late Shri Nana....
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....come of such individual - Held, no" iii) The Hon'ble THE ITAT AHMEDABAD BENCH 'D' in case of Deputy Commissioner of Income-tax , Central Circle-2, Surat v. MoolchandMaganlal Jain* [2015] 62 taxmann.com 353 (Ahmedabad - Trib.) held that "Section 64 of the Income-tax Act, 1961 - Transfer of assets - For benefit of spouse etc. (Daughter-in-law) - Assessment year 2009-10 - During relevant year, assessee paid job work charges to his daughters-in-law - Assessing Officer took a view that income in hands of daughters-in-law was required to be clubbed with income of assessee under section 64(1) - Whether unless it was proved that income earning asset was transferred by assessee to daughters-in- law, their income could not be clubbed in hands of assessee - Held, yes - Whether since Assessing Officer failed to bring any evidence on record demonstrating fact that assessee had transferred any income generating asset to daughters in law, impugned addition was to be set aside - Held, yes [Para 12] [In favour of assessee]" iv) That Hon'ble ITAT BANGALORE BENCH 'A' in case of C. Babu v. Income-tax Officer, Ward-I, Chitradurga [2006] 6 SOT 233 (Bangalore)[16-02-2005] held t....
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....s i.e., cable operators in name of assessee - Thereafter, assessee remitted entire gross amount received from cable operators to 'S' - Assessee-company filed its return of income for relevant year - Assessing Officer during assessment, disallowed credit for corresponding TDS on ground that assessee had not included subscription charges corresponding to TDS amount in profit and loss account - Whether since subscription collected by assessee from various Cable Operators was not income of assessee, same was not shown in profit and loss account - Held, yes - Whether subscription amount was income of 'S' and as such taxable in hands of 'S' - Held, yes - Whether further, since TDS had been deducted in name of assessee and paid to Government at time of making collections, assessee would be entitled to get credit of same while receiving commission income - Held, yes [Paras 13, 14 and 21] [In favour of assessee]" ii) That the Hon'ble THE ITAT MUMBAI BENCH 'SMC' in case of Shri Rangji Realties (P.) Ltd. v. Income-tax Officer-1(3)(1), Mumbai* [2017] 82 taxmann.com 456 (Mumbai - Trib.) held that "Section 199, read with sections 23 and 198, of the Income....
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....the assessee of such financial year. Since the Humble Appellant has proved nature & source of Investments as appeared in both the Registry executed during the year of Flat, Thus the value of Investments cannot be treated as Income of the Taxpayer. The humble Appellant and his Father Late Shri Nanak Gurbani (co-owner in Jaipur Flat) have given Payment through Account Payee Cheques, submitted the Death Certificate of Late Shri Nanak Gurbani Ji, Purchase Agreement & Registries - the Learned Assessing Officer made the Additions u/s 69 of the Income Tax Act while passing the Order for AY 2017-18 of Humble Appellant. The Additions made in Appellant case is against Facts & Law as held in following judicial Judgements:- i) That the Hon'ble ITAT JAIPUR BENCH in case of Smt. Renu Agarwal v. Assistant Commissioner of Income-tax, Central Circle-3, Jaipur* [2017] 88 taxmann.com 872 (Jaipur - Trib.) held that Section 69 of the Income-tax Act, 1961 - Unexplained investments (Immovable property) - Assessment year 2009-10 - Where seller had given a statement on oath that he had received Rs. 65 lakhs only from assessee on sale of land and that agreement to sell plot of land after carrying o....
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....avour of assessee] III. Section 69, read with section 132 of the Income-tax Act, 1961 - Unexplained investments (Purchase of property) - Assessment year 2002-03 - Assessee proved that investment in purchase of impugned property was made out of money returned by two parties with whom he carried out financial transactions - Whether since fund was available with assessee at relevant time, additions made by Assessing Officer towards unexplained investment in property were not maintainable and Assessing Officer was to be directed to delete same - Held, yes [Paras 20.2 & 20.3] [In favour of assessee] IV. Section 69A of the Income-tax Act, 1961 - Unexplained moneys (Bank deposits) - Assessment year 2002-03 - Whether revenue having accepted purchase of property by assessee, a real estate broker for Rs. 19 lakhs, claim of sale of same for Rs. 21 lakhs and deposit of same in bank was to be accepted - Held, yes - Whether since Assessing Officer, in immediately succeeding year, has accepted submission of assessee that bank deposits represented advances received from various persons in respect of his real estate business, loans availed by him and commission received, same was to be accepted for....
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....ained by assessee - In absence of details, Assessing Officer computed peak credit balance at Rs. 98.65 lakhs and assessed same as income of assessee - Whether in absence of corresponding asset/expense vis-à-vis alleged income, it would not be proper to presume that entire amount of deposits made into bank account represented current income of assessee - Held, yes - Whether Assessing Officer having accepted for previous year that deposits found in bank accounts relate to transactions carried by assessee in his real estate and vehicle brokerage business, same logic was to be extended for current year also - Held, yes - Whether thus Assessing Officer was to be directed to delete additions relating to bank deposits - Held, yes [Paras 32.4 & 32.7] [In favour of assessee] IX. Section 69 of the Income-tax Act, 1961 - Unexplained investments (Purchase of car) - Assessment year 2005-06 - Whether, where assessee had explained that payments made by him for purchase of cars were from several car loans taken from banks, Commissioner (Appeals) had rightly deleted addition - Held, yes [Para 36.4] [In favour of assessee] XIII. Section 153A of the Income-tax Act, 1961 - Search and seizure - ....
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....RD MEMBER) in case of K. Moidu v. Assistant Commissioner of Income-tax[2002] 81 ITD 242 (COCHIN) (TM) held that "Section 158B of the Income-tax Act, 1961 - Block assessment in search cases - Undisclosed income - Block assessment years 1987-88 to 1997-98 - Assessees were non-resident Indians carrying on business outside India - They had made considerable remittances to their NRE accounts in India - During relevant period, they had purchased immovable properties and constructed various buildings in India - Department carried out a search operation under section 132 at residential premises of assessees in India on suspicion of undervaluation and 'on money' payments in respect of such purchases - Subsequently, Assessing Officer initiated assessment proceedings under section 158BC and found that actual consideration paid by assessees for acquiring immovable properties was more than ostensible consideration mentioned in registration documents - Difference in above two considerations was treated by him as undisclosed income in hands of assessees - Similarly, Assessing Officer made further additions under Chapter XIV-B by estimating cost of construction of buildings at a rate higher than t....
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....ifts) - Assessment year 2001- 02 - Whether under section 68, Assessing Officer, while assessing a partnership firm, can go behind source of income of partnership firm, but he cannot go to 'source of source' - Held, yes - Whether where assessee has given supporting material evidencing gift or amount received from particular person with necessary documents, such as, copies of demand drafts and cheques etc., no addition could have been made by Commissioner in respect of amount received by assessee - Held, yes [Paras 6 & 7] [In favour of assessee]" ix) That the Hon'ble HIGH COURT OF GUJARAT in case of Principal Commissioner of Income-tax-2 v. D & H Enterprises* [2016] 72 taxmann.com 91 (Gujarat) held that "Section 68, read with section 131, of the Income-tax Act, 1961 - Cash credit (Advance) - Assessment years 2006-07 and 2007-08 - In scrutiny, it was revealed that assessee had shown advances from 84 persons towards investment in land - Assessee submitted that these were received as advance booking amounts through cheques in ordinary course of business - Assessee had filed confirmations of all persons, copies of their bank statements, income tax returns, etc. - Assessi....
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....to in sub-section (5), after considering the following, namely:- (a) draft order; (b) objections filed by the assessee; (c) evidence furnished by the assessee; (d) report, if any, of the Assessing Officer, Valuation Officer or Transfer Pricing Officer or any other authority; (e) records relating to the draft order; (f) evidence collected by, or caused to be collected by, it; and (g) result of any enquiry made by, or caused to be made by, it. (7) The Dispute Resolution Panel may, before issuing any directions referred to in sub-section (5),- (a) make such further enquiry, as it thinks fit; or (b) cause any further enquiry to be made by any income-tax authority and report the result of the same to it. (8) The Dispute Resolution Panel may confirm, reduce or enhance the variations proposed in the draft order so, however, that it shall not set aside any proposed variation or issue any direction under sub-section (5) for further enquiry and passing of the assessment order. ^6[Explanation.-For the removal of doubts, it is hereby declared that the power of the Dispute Resolution Pane....
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....tion; (c) introducing a mechanism with dynamic jurisdiction for issuance of directions by dispute resolution panel. (14C) The Central Government may, for the purpose of giving effect to the scheme made under sub-section (14B), by notification in the Official Gazette, direct that any of the provisions of this Act shall not apply or shall apply with such exceptions, modifications and adaptations as may be specified in the notification: Provided that no direction shall be issued after the 31st day of March, ^11a[2024 ]. (14D) Every notification issued under sub-section (14B) and sub-section (14C) shall, as soon as may be after the notification is issued, be laid before each House of Parliament.] (15) For the purposes of this section,- (a) "Dispute Resolution Panel" means a collegium comprising of three ^10[Principal Commissioners or] Commissioners of Income-tax constituted by the Board^12 for this purpose; (b) "eligible assessee" means,- (i) any person in whose case the variation referred to in sub-section (1) arises as a consequence of the order of the Transfer Pricing Officer passed under sub-section (3....
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....he assessee as the agent of a non-resident; (e) an order made under sub-section (2) or subsection (3) of section 170; (f) an order made under section 171; (g) an order made under clause (b) of sub-section (1) or under sub-section (2) or sub-section (3) or sub- section (5) of section 185 in respect of an assessment for the assessment year commencing on or before the 1st day of April, 1992; (h) an order cancelling the registration of a firm under sub-section (1) or under sub-section (2) of section 186 in respect of any assessment for the assessment year commencing on or before the 1st day of April, 1992 or any earlier assessment year; ^9[(ha) an order made under section 201;] ^10[(hb) an order made under sub-section (6A) of section 206C;] (i) an order made under section 237; ^10a[( ia) an order made under section 239A; ] (j) an order imposing a penalty under- (A) section 221; or (B) section 271, section 271A, ^10b[ section 271AAA,] ^11[ section 271AAB,] section 271F, ^12[ section 271FB,] section 272AA or section 272BB; (C) section 272, section 272B or section 273, as they stood....
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....ppeal under this Act which is pending immediately before the appointed day, before the Deputy Commissioner (Appeals) and any matter arising out of or connected with such appeals and which is so pending shall stand transferred on that date to the Commissioner (Appeals) and the Commissioner (Appeals) may proceed with such appeal or matter from the stage at which it was on that day : Provided that the appellant may demand that before proceeding further with the appeal or matter, the previous proceeding or any part thereof be reopened or that he be re-heard. Explanation.- For the purposes of this section, "appointed day" means the day appointed by the Central Government by notification17 in the Official Gazette.] The summary of Proceedings as per below:- Draft Order Issued on Dt 27-03-2022 u/s 147 Application Filed before DRP -1 on Dt 26-04-2022 against the Draft Order u/s 147 Order passed u/s 147 rws 144C (3) on Dt 13-05-2022 Appeal Filed before CIT(A) against the Order Dt 13-05-2022 on dt 06-06- 2022 Withdrawal of Application filled before DRP-1 against the Draft Order u/s 147 Dt 27-03-2022 on dt 22-09-2022 Order passed by DRP-1 on Dt 13-12-2022....
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.... 5. Copy of Letter filed before DRP for withdrawal of Application 37-38 6. Application U/R 46A Submitted Before CIT(A) 39 7. Copy of ITR & Computation of Shri Nanak Gurbani AY 2014-15 To 2017-18 40-52 8. Copy of Housing Loan - ICICI Bank Limited (Nanak Gurbani) 53-58 9. Copy of Housing Loan - Repayment Schedule - ICICI Bank Limited (Nanak Gurbani) 59-60 10. Payment Statement along with supporting bank Statements 206, Okay Plus Empress (Jaipur Flat) 61-68 11. Payment Statement along with supporting bank Statements Nahar Homes LLP (Pune Flat) 69-78 12. Death Certificate (Nanak Gurbani) 79 13. Purchase Agreement / Registry (Jaipur Flat) 80-101 14. Purchase Agreement / Registry (Pune Flat) 102-129 15. Remittance Certificate & Supporting Bank Statement 130-131 Paper book - II S No Particulars Page No. 1. Application for obtaining Certified copy of proceedings & paper for Decision u/s 147 rws 144(3) of Income Tax Act 1 2. Letter Dt 12-01-2023 issued by AO 2 3. Copy of Remand Report 3-5 4. Demand Notice, Order, Computation Sheet of Order Dt 1....
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....the assessee has not paid an amount of Rs. 52,37,475/- for the year under consideration the same cannot be added as unexplained investment. To support this contention ld. AR of the assessee drawn our attention to page 106 of his paper book wherein the agreement for purchase of this property is made and the assessee has filed an affidavit stating that he has not paid at Rs. 52,37,475/- as extracted here in above. Therefore, only the commitment to make the future payment cannot be added as unexplained investment of the assessee. 11. As regards the addition of Rs. 12,62,670/-, [ refer Table A para 3.1 above ]the ld. AR of the assessee submitted that Rs. 5,49,770/- added by the ld. AO is not correct. But the total amount for this property amounts to Rs. 6,41,920/-[ page 87 of paper book]out of that the assessee has paid at Rs. 1,71,744/- as it is evident from an agreement submitted by the assessee at page 90 of his paper book which is not under dispute. The balance amount is paid by his father as the property is in joint name with his father. Therefore, the addition made to the extent of Rs. 5,49,770/- is incorrect and is not paid by the assessee. As regards the 2nd part of the stam....
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.... of registration and TDS process the total amount of investment considered but the same cannot be taken as a basis for which the actual payment neither due nor paid by the assessee. Thus, the same cannot be considered as unexplained investment by the assessee. We have gone through the proposals,letters and relevant deed of purchase of property placed on record before us and before ld. CIT(A). The said information contended by the ld. AR of the assessee is based on evidence which has not been controverted that the assessee has not paid the said amount. Hence, in the absence of clear evidence placed before us we are of the considered view that once the assessee has not made any payment the same cannot be added as unexplained investment.The revenue did not bring on record contraryfact that the assessee has paid this amount. But in fact it is based on the record that the same is considered as due by the builder. Thus, the due payment cannot be added as unexplained investment by the assessee. Therefore, we are of the considered view that the addition of Rs. 52,37,475/- does not have leg to stands and the same is thus vacated. 16. As regards the addition of stamp duty for an amount of....
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....d No. 1 is not adjudicated since we have considered the merits of the case and therefore, this become educative in nature. Ground No. 4 to 12 are general, either for challenging the proceeding, contesting the interest, initiation of penalty etc. for which no specific arguments were advanced and since we have deleted the addition based on the above discussion these ground no. 4 to 12 are either consequential in nature or educative in nature and the same are not adjudicated. In the result, appeal of the assessee is allowed. Order pronounced in the open court on 05/10/2023. ============= Document 1 2701 सà¥à¤¥à¤¾à¤¨ AFFIDAVIT I Girish Gurbani General Power of Attorney Holder of Shri Jai Kumar Gurbani R/O 206, Empress, B-4, Bani Park, Shiv Marg, Bani Park, Jaipur-302016 (Rajasthan) Aged 39 years do hereby affirm on oath as under.- an I. II. III. IV. That I am General Power of Attorney Holder of Shri Jai Kumar Gurbani for Execution of Registry situated at: a. Property situated at Pune being flat no. A1-1701,F Residencies, Village Balewadi, High Street, Balewadi, Baner Link Road, Pune-411045 (Maharashtra) wherein Shri Ja....