AI Drafter 
TaxTMI 
TaxTMI 
TaxTMI 
2025 (5) TMI 1646
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....preciate that deposits in the bank stood duly explained out of the advance received from one Shri Prahlad Singh who had duly confirmed the advance by appearing in person and as such the addition confirmed is legally unsustainable. 1.2 That the learned Commissioner of Income Tax (Appeals) has overlooked relevant evidence placed on record and, drawn factually incorrect and legally unsustainable inferences based on irrelevant and extraneous consideration and thus, addition sustained is wholly unwarranted and not in accordance with law. 2. That the learned Commissioner of Income Tax (Appeals) has further erred both in law and on facts in upholding an addition of Rs. 45,43,000/- out of Rs. 57,13,000/- representing sums received by the assessee in course of business of property dealing and, held to be unexplained cash credit u/s 68 of the Act. 2.1 That the learned Commissioner of Income Tax (Appeals) has failed to appreciate that assessee has led evidence so as to discharge the onus under section 68 of the Act and therefore, the addition sustained on subjective and arbitrary assumptions is contrary to law and hence untenable. 2.2 That finding of the le....
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....ly during remand proceedings he accepted having paid the impugned amount to the assessee. Further, in the absence of any written agreement for the transaction of land, to which, the advance pertained and noting that entire transaction was carried out in cash and not through banking channel, the Ld. CIT(A) held the explanation of the assessee to be not plausible and accordingly confirmed the addition made by the AO of Rs. 25 Lacs. The findings of the Ld. CIT(A) in this regard is at paragraph 5.1 of his order as under: "5.1 Advance of Rs 25 lacs received against agreement from Sh. Prahalad Singh - As per the remand report, the AO has examined Sh. Prahalad Singh on oath and submitted a detailed report in which he has referred to the documentary evidence and statements where earlier statement of Sh. Prahalad Singh dated 21.03.2016 was negative and he clearly denied having given any advance to the assessee and the current statement during the remand proceedings which affirms that he had made an advance of Rs 25 lacs. He has relied on the documents of sale of property of Sh. Prahalad Singh out of which the advance was made to the assessee, his statement in this respect and the m....
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....d that he has not done any agreement with Mr. RohtasRawat and denied that advance of Rs 25 lacs has been paid to him. In view of the AO's remand report and facts of the case (where there are two contradictory statements), in the absence of a written agreement and the fact that the transaction was not made through banking channel, the assessee fails to substantiate his claim that advance of Rs 25 lacs was received from Sh. Prahalad Singh. In view of the above discussion, this ground of appeal is dismissed." 6. With respect to the source of cash deposit attributed to amount received from various purchasers of land which the Ld. CIT(A) had confirmed to the tune of Rs. 45,43,000/-,the assessee had attributed cash deposits in his bank account amounting to Rs. 63,43,000/- as being received from such purchasers who were 26 persons in number. Since 4 persons were produced before the AO who had stated to have given an amount of Rs. 6,30,000/- for purchase of land to the assessee, the AO accepted cash to have been received from these persons and for the remaining amount of Rs. 57,30,000/ in the absence of any substantiation of the assessee's explanation, he held the same as unexplaine....
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....d to be correct. As regards the remaining amount of Rs 45,43,000/- the assessee failed to produce the remaining 17 persons for statement/enquiry and no supporting documents could be furnished in this respect. In view of the facts of the case and above discussion it is held that inspite of several opportunities during the assessment proceedings and again during the remand proceedings, after the request was made by the assessee u/r 46A of IT rules, the assessee could produce only five more persons from whom Rs 11,70,000/- was received by the assessee. As rightly mentioned in the remand report and in the assessment order, no proper evidence has been furnished in respect of the remaining amount of Rs 45,43,000/-. That seventeen persons had paid this amount of Rs 45,43,000/-, as claimed by the assessee, is not substantiated with the help of conveyance deeds, bank accounts as the dates of deposit, withdrawals and sale are not matching and the assessee's name is not there in the conveyance deeds. The assessee had ample time to produce the 17 persons during the remand proceedings and substantiate his claim. I agree with the finding of AO that the assessee has failed to establi....
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....Delhi High Court held that where assessee failed to prove identity and capacity of subscriber companies to pay share application money, amount so received was liable to be taxed under section 68. In view of the above discussion, this ground of appeal is partly allowed." 8. All the grounds raised by the assessee before us pertain to the aforesaid two additions confirmed by the Ld. CIT(A) u/s. 68 of the Act in the hands of the assessee. 9. Having heard the contentions of both the parties, we have noted that the explanation of cash amounting to Rs. 25 lacs having been sourced from advance given by one Shri Prahlad Singh to the assessee for purchase of land was rejected by the Ld. CIT(A) for the reason that Shri Prahlad Singh had given contradictory statements in this regard; that he initially denied paying any such advance to the assessee and subsequently confirmed the same. Added to it, was the fact noted by the Ld. CIT(A) that the purported land deal was not evidenced with any agreement and was apparently carried out entirely in cash. And based on this, he rejected the assessee's explanation as not true or believable. 10. In our view, the findings of the Ld. CIT(A)....