ACIT, CHITTORGARH v. Shri Roshan Lal Lodha, CHITTORGARH

ITA 275/JODH/2013 | 2008-2009
Pronouncement Date: 31-10-2013 | Result: Dismissed

Appeal Details

RSA Number 27523314 RSA 2013
Assessee PAN ABNPL5407E
Bench Jodhpur
Appeal Number ITA 275/JODH/2013
Duration Of Justice 5 month(s) 25 day(s)
Appellant ACIT, CHITTORGARH
Respondent Shri Roshan Lal Lodha, CHITTORGARH
Appeal Type Income Tax Appeal
Pronouncement Date 31-10-2013
Appeal Filed By Department
Order Result Dismissed
Bench Allotted DB
Tribunal Order Date 31-10-2013
Date Of Final Hearing 30-10-2013
Next Hearing Date 30-10-2013
Assessment Year 2008-2009
Appeal Filed On 06-05-2013
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL JODHPUR BENCH JODHPUR BEFORE SHRI HARI OM MARATHA JUDICIAL MEMBER AND SHRI N.K.SAINI ACCOUNTANT MEMBER ITA NOS. 275/JU/2013 A.Y: 2008-09 THE A.C.I.T. VS. SHRI ROSHAN LAL LODHA CIRCLE P/O M/S ARIHANT PROPERTIES CHITTORGARH SENTHI BAPU NAGAR CHITTORGARH PAN NO. ABNPL 5407 E (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI U.C. JAIN SHRI RAJENDRA JAIN DEPARTMENT BY : SHRI R.H. GOHEL-DR DATE OF HEARING : 30.10.2013 DATE OF PRONOUNCEMENT : 3110.2013 ORDER PER HARI OM MARATHA J.M. THIS APPEAL FILED BY THE DEPARTMENT IS DIRECTED AGAINST THE ORDER OF THE CIT(A) UDAIPUR DATED 25. 02.2013 FOR A.Y 2008-09. 2 2. THE FOLLOWING GROUNDS HAVE BEEN RAISED IN THIS APPEAL: ON THE FACTS AND IN THE PRESENT CIRCUMSTANCES OF T HE CASE THE LEARNED CIT (A) HAS ERRED IN:- 1(A) DELETING THE ADDITION MADE BY THE AO UNDER THE HEAD OF INCOME FROM UNDISCLOSED SOURCES RS. 37 50 000/- (35 00 000+2 50 000) DESPITE THE FACT T HAT EVIDENCE OF UNACCOUNTED PAYMENT FOR PURCHASE OF LAN D IS CLEARLY REFLECTED IN LOOSE PAPER PAGE 1 OF EX. A -1 FOUND DURING THE COURSE OF SURVEY WHICH WAS FURTHER SUPPORTED BY ORAL EVIDENCE BY WAY OF STATEMENT OF T HE ASSESSEE RECORDED DURING THE COURSE OF SURVEY. 1(B) ACCEPTING THE NEW ARGUMENT OF THE ASSESSEE OF CONTRIBUTION BY THE 5 MEMBERS FOR PURCHASE OF LAND BY WAY OF REGISTERED DOCUMENTS DESPITE THE FACT THAT NO SUCH CLAIM WAS MADE DURING THE COURSE OF SURVEY AND ALSO ERRED IN IGNORING THE ADMITTED STATEMENT OF TH E ASSESSEE THAT AFTER GIVING ADVANCE TO THE SELLER SUBSEQUENTLY THE ASSESSEE SOLD THE PLOT TO OTHER PE RSONS & THE REGISTERED DOCUMENTS AS REFERRED ABOVE WERE DIRECTLY EXECUTED IN THEIR NAMES. 3 1(C) DELETING THE ADDITION MADE BY THE AO BEING NOTIONAL INTEREST PAYMENT RS. 4 92 500/- WITHOUT APPRECIATING THE FULL FACTS OF THE CASE. 2. DELETING THE ADDITION MADE BY THE AO UNDE R THE HEAD OF UNEXPLAINED CASH CREDIT U/S 68 AT RS. 1 20 000/- IGNORING THE FACT THAT THE CREDITWORTHINESS OF THE CREDITOR WAS NOT PROVED. THAT THE APPELLANT CRAVES TO ADD AMEND ALTER DEL ETE OR MODIFY ANY ARE ALL THE ABOVE GROUNDS OF APPEAL BEFORE OR AT THE TIME OF HEARING. 3. BRIEFLY STATED THE FACTS OF THE CASE ARE THAT T HE ASSESSEE AS AN INDIVIDUAL DERIVED INCOME FROM BRO KERAGE IN REAL ESTATE TRANSACTIONS AND FROM BUSINESS OF PU RCHASE AND SALE OF AGRICULTURAL LAND/RESIDENTIAL PLOTS. A SURVEY U/S 133A OF THE INCOME-TAX ACT 1961 [HEREINAFTER R EFERRED TO AS 'THE ACT' FOR SHORT] WAS CARRIED OUT AT THE BUSINESS PREMISES OF THE ASSESSEE ON 25.03.2010. DURING SUR VEY PROCEEDINGS SOME LOOSE PAPERS AND INCRIMINATING DOCUMENTS WERE FOUND AND IMPOUNDED BY THE DEPARTMEN T AS ANNEXURE A OF EXHIBIT NO. 1. AS PER PAGE 1 IT WAS 4 NOTED THAT THE ASSESSEE HAD PURCHASED A PIECE OF AGRICULTURAL LAND MEASURING 0.88 HECTARES [88 AARI] SITUATED IN KHASRA NO. 573 AT SENTHI BAPU NAGAR CHITTORGARH @ RS. 1 11 778/- PER AARI TOTALING TO R S. 98 36 000/- ON 01/06/2007 OUT OF WHICH THE ASSESSEE HAS MADE PAYMENT OF RS. 35 LAKHS IN CASH ON 01/06/2007 TO SHRI BHANWARJI AGAINST THE SAID AGRICULTURAL LAND. DURING SURVEY THE ASSESSEE HAD SURRENDERED RS. 35 LAKHS F OR TAXATION IN A.Y. 20008-09. PROCEEDINGS U/S 148 R.W. S 147 OF THE ACT WERE CARRIED OUT AND IN COMPLIANCE TO NO TICE U/S 148 OF THE ACT DATED 15.4.2010 THE ASSESSEE FI LED RETURN ON 28.4.2010 DECLARING TOTAL INCOME OF RS. 13 41 060/-. DURING THE ACCOUNTING PERIOD RELEVANT TO THE A.Y. UNDER CONSIDERATION ON TOTAL BROKERAGE RECEIP T OF RS. 16 28 700/- NET INCOME OF RS. 14 75 388 HAS BEEN S HOWN. HOWEVER THE ASSESSEE HAS NOT SHOWN RS. 35 LAKHS SURRENDERED DURING SURVEY. DURING THE ASSESSMENT PROCEEDINGS THE ASSESSEE WAS QUIZZED TO EXPLAIN THI S ANOMALY. THE ASSESSEE VIDE LETTER DATED 23.11.201 1 REPLIED AS UNDER: 5 FIRSTLY THEY PAID RS. 35 00 000/- AND RECEIVED BACK RS. 10 00 000/- ON THE DATE OF REGISTRY OF AGRICULTURAL LAND AND OUT OF RS. 25 00 000/- THE SHARE OF ASSESSEE IS RS. 5 00 000/- [BEING 1/5 TH ] ONLY. BY RELYING HEAVILY ON THE STATEMENT RECORDED DURING SURVEY IN WHICH THE ASSESSEE ADMITTED TO HAVE PAID RS. 35 LAKHS IN CASH OUT OF UNDISCLOSED SOURCES OF INCOME AND SURRE NDERED THE SAME FOR TAXATION IN A.Y. 2008-09 THE A.O. HAS CHOSEN TO IGNORE ALL THE EVIDENCE FILED TO SUBSTANTIATE AN D EXPLAIN THAT THE SURRENDER MADE DURING SURVEY WAS NOT CORRE CT. RATHER THE A.O. HAS FOUND FROM THE EXPLANATION OF THE ASSESSEE THAT THE ASSESSEE HAS FURTHER PAID INTERES T AMOUNT OF RS. 4 92 500/- AND HE HAS ALSO FURTHER HE LD THE SUM OF RS. 2 50 000/- CLAIMED TO HAVE BEEN PAID PAI D ON 13.1.2008 AND 16.2.2008. IN THE ABSENCE OF SUPPORT ING EVIDENCE REGARDING THE SOURCE OF THESE PAYMENTS AS ASSESSEES UNDISCLOSED INCOME AND HAS ADDED THE SAM E IN THE HANDS OF THE ASSESSEE. AGGRIEVED THE ASSESSEE FILED APPEAL AND THE LD. CIT(A) HAS DELETED THIS ENTIRE A DDITION 6 BY COMING TO THE CONCLUSION THAT THE ENTIRE AMOUNT STANDS EXPLAINED ON RECORD AND ONLY ON THE BASIS OF SURREN DER MADE AND STATEMENT RECORDED DURING SURVEY NO SUCH ADDITION CAN BE SUSTAINED. THE FINDING OF THE LD. CIT(A) IS CONTAINED IN PARA 4.3 OF HIS ORDER WHICH IS REPROD UCED HEREINBELOW: 4.3 I HAVE CONSIDERED THE SUBMISSIONS OF THE APPELLANT AS WELL AS THE FINDINGS OF THE A.0 GIVEN IN THE ASSESSMENT ALONGWITH THE REMAND REPORT AND ITS REPL Y FILED BY THE APPELLANT. DURING THE REMAND REPORT T HE AO HAS CONDUCTED ENQUIRIES ON THE BASIS OF THE SUBMISSIONS OF THE APPELLANT MADE IN THE APPELLATE PROCEEDINGS AND ON THE BASIS OF THE PURCHASE DEED O F THE AGRICULTURAL LAND. 0N ENQUIRY IT HAS BEEN PROVE D THAT THE AGRICULTURAL LAND WAS PURCHASED BY FIVE PE RSONS INCLUDING THE APPELLANT FOR RS.25 00 000 BY MAKING EQUAL CONTRIBUTION I.E. RS. 5 LAKH EACH PLUS STAMP DUTY AND REGISTRATION CHARGES. THIS MEANS THAT THE APPE LLANT HAS MADE INVESTMENT OF ONLY RS. 5 LAKHS AND NOT THE ENTIRE AMOUNT AS HELD BY THE A.0 IN THE ASSESSMENT ORDER ON THE BASIS OF THE STATEMENT RECORDED AT THE TIME OF SURVEY WHICH HAS BEEN PROVED TO BE WRONG DURING THE ENQUIRY CONDUCTED AT THE TIME OF REMAND REPORT ALL THE OTHER PURCHASERS EXCEPT SHRI SUNIL 7 SISODIA ARE INCOME-TAX ASSESSEES AND THEY HAVE SHOW N THE INVESTMENT IN THEIR RETURN OF INCOME FILED. AS REGARDS THE ENTRIES RECORDED ON THE LOOSE PAPERS FOUND AT THE TIME OF SURVEY AMOUNTING TO RS. 98 36 000 AS VALUE OF THE LAND IT HAS BEEN SUBMITTED THAT TH E OWNER OF THE AGRICULTURAL LAND HAD AGREED TO SELL T HE LAND AFTER CONVERSION. HOWEVER LATER ON THE SELLER EXPRESSED HIS INABILITY TO GET THE LAND CONVERTED A ND THEREFORE THE PURCHASER AGREED TO PURCHASE THE LAND AS AGRICULTURAL LAND AND THEREFORE THE SELLER RETURNE D RS. 10 LAKHS OUT OF RS 35 00 000/- AND THE AGRICUL TURAL LAND WAS REGISTERED FOR RS.25 00 000/- PLUS STAMP D UTY AND REGISTRATION FEES. THEREFORE THERE IS NO PAYM ENT OVER AND ABOVE THAN SHOWN IN THE REGISTRATION DEED AND THEREFORE THE INVESTMENT MADE BY THE ASSESSEE IN PURCHASE OF THE AGRICULTURAL LAND AMOUNTING TO RS. 5 34 000/- IS FULLY EXPLAINED AND THE AGRICULTURAL LAND HAS BEEN DULY SHOWN IN THE BALANCE SHEET. IN VIEW O F ABOVE DISCUSSION AND CONSIDERING THE REMAND REPORT OF THE A.O. IN WHICH IT HAS BEEN ADMITTED BY THE A.0. THAT THE LAND HAS BEEN PURCHASED BY THE APPELLANT ALONGW ITH FOUR OTHERS THE ADDITION MADE BY THE A.0. AMOUNTIN G TO RS. 35 LAKHS ON THIS ACCOUNT IS DELETED. 8 AS REGARDS THE SOURCE OF THE AMOUNT OF RS. 2 50 000 /- WHICH HAS BEEN ADDED BY THE A.0. TO THE TOTAL INCOM E OF THE APPELLANT IT IS SEEN THAT THE SAID TRANSACTION S OF RS.1 50 000/- AND RS. 1 00 000/- WERE MADE BETWEEN MR. UDAI RAM DHAKAR AND MR. DEVILAL FOR PURCHASE OF PLOTS THROUGH THE APPELLANT AND THE APPELLANT HAS A CTED ONLY AS A MEDIATOR. IN SUPPORT OF THIS THE APPELLA NT HAS FILED COPY OF RECEIPT DULY SIGNED BY SHRI DEVILAL M EENA AND UDAI RAM. THE A0 HAS NOT CONTROVERTED THIS FACT DURING THE RE MAND PROCEEDINGS WHICH CLEARLY SHOWS THAT THE SOURCE OF THIS PAYMENT HAS BEEN ACCEPTED AS EXPLAINED AND THEREFOR E THE ADDITION MADE IS LIABLE TO BE DELETED AND I ORD ER ACCORDINGLY. AS REGARDS THE ADDITION OF RS.4 92 500/- ON ACCOUNT OF NOTIONAL INTEREST WORKED OUT AND CLAIMED TO HAVE BE EN PAID ON OUTSTANDING AMOUNT AS WORKED OUT AT PAGE NO . 5 OF THE ASSESSMENT ORDER IT MAY BE MENTIONED HERE T HAT THERE WAS NO OUTSTANDING PAYMENTS PAYABLE BY THE APPELLANT TO THE SELLER OF THE PROPERTY FOR THE REASONS GIVEN WHILE DELETING THE ADDITION OF RS. 35 LAKHS MENTIONED SUPRA. FURTHER THE A.O. HAS ALSO NOT BROUGHT ANY MATERIAL ON RECORD TO SUGGEST THAT THE APPELLANT HAS ACTUALLY PAID 9 SUCH INTEREST OUT OF HIS UNDISCLOSED INCOME. IN THE ABSENCE OF ANY SUCH DETAIL THE ADDITION MADE BY THE A.O. IS LIABLE TO BE DELETED AND I ORDER ACCORDINGLY. ACCORDINGLY THE LD. CIT(A) HAS DELETED THE ABOVE A DDITIONS AGAINST WHICH THE REVENUE HAS RAISED GROUND NOS. 1( A) 1(B) AND 1(C). 4. WE HAVE HEARD THE RIVAL SUBMISSIONS AND HAVE CAREFULLY PERUSED THE ENTIRE MATERIAL ON RECORD. T HE REASONS FOR ASSAILING THE FINDINGS OF THE LD. CIT(A ) ARE GIVEN IN THE GROUNDS ITSELF AND THE LD. D.R. HAS RE PEATED THEM IN SUPPORT OF THE ABOVE GROUNDS. THE LD. D.R. RELIED ON THE ORDERS OF THE A.O. ON THE OTHER HAND THE L D. A.R. SHRI U.C. JAIN HEAVILY RELIED ON THE ORDER OF THE L D. CIT(A). AFTER CONSIDERING THE RIVAL SUBMISSIONS WE ARE CON VINCED THAT THE A.O. HAS MAINLY RELIED ON THE STATEMENT RE CORDED DURING SURVEY. IN FACT IT IS TRITE THAT ANY STATE MENT MADE DURING SURVEY HAS GOT NO EVIDENTIARY VALUE. MOREOV ER AS IS EVIDENT FROM THE FINDING OF THE LD. CIT(A) ALL PAYMENTS 10 STAND EXPLAINED BY THE ASSESSEE. WE ARE FULLY IN AG REEMENT WITH THE FINDING OF THE LD. CIT(A). IT IS PROVED O N RECORD THAT THE AGRICULTURAL LAND WAS PURCHASED BY FIVE PE RSONS INCLUDING THE ASSESSEE FOR A CONSIDERATION OF RS. 2 5 LAKHS BY MAKING EQUAL CONTRIBUTIONS OF RS. 5 LAKHS EACH + STAMP DUTY/REGISTRATION CHARGES. THUS THE ASSESSEE HAS N OT MADE THE ENTIRE PAYMENT WHICH DISPROVES THE ADMISSION DU RING SURVEY. ALL OTHER CO-PURCHASERS HAVE DISCLOSED THI S FACT IN THEIR INDIVIDUAL ROI WHICH HAVE BEEN SHOWN AS THEIR INVESTMENT AND HAVE BEEN ACCEPTED BY THE DEPARTMENT . REGARDING ENTRIES RECORDED ON THE LOOSE PAPERS FOUN D AT THE TIME OF SURVEY TOTALLY RS. 98 36 000/- AND TREA TED AS VALUE OF THE LAND IS ALSO NOT FOUND TO BE CORRECT. EARLIER THE OWNER HAD TO TRANSFER THE LAND AFTER GETTING IT CONVERTED INTO COMMERCIAL USE. BUT LATER ON WHEN HE WAS NOT ABLE TO DO SO HE RETURNED RS. 10 LAKHS AND THE LAND WAS REGISTERED FOR RS. 25 LAKHS + STAMP DUTY ETC. SO IN FACT THERE WAS NO ON-MONEY PAYMENT. THE SHARE OF THE ASSESSEE BEING RS. 5 34 000/- IS FULLY EXPLAINED AN D THIS LAND HAS BEEN DULY SHOWN IN HIS BALANCE SHEET. BUT THE 11 ABOVE FINDING IS ALSO VETTED WITH THE REMAND REPORT OF THE A.O AS THE A.O. HIMSELF HAS ACCEPTED IN THE REMAND REPORT THAT THIS LAND WAS PURCHASED BY FIVE PERSONS INCLUDING ASSESSEE. THEREFORE THE DELETION OF ADD ITION OF RS. 35 LAKHS ON ACCOUNT OF THIS REASON HAS CLEARLY BEEN DELETED BY THE LD. CIT(A). 5. IN SO FAR AS RS. 2.5 LAKHS IS CONCERNED IT IS F OUND THAT THE TRANSACTION OF RS. 1.5 LAKHS AND RS. 1 LAKH WER E MADE BY SHRI UDAI RAM DHAKAR AND SHRI DEVI LAL FOR PURCH ASE OF PLOT THROUGH THE ASSESSEE AND THE ASSESSEE WAS ONLY A MEDIATOR. THIS HAS BEEN CONFIRMED BY RECEIPT DULY SINGED BY SHRI DEVI LAL AND SHRI UDAIRAM. THIS RECEIPT HA S NOT BEEN DISPUTED OR CONTROVERTED BY THE A.O. REGARDIN G DELETION OF RS. 4 92 500/- ADDED ON ACCOUNT OF NOTI ONAL INTEREST WORKED OUT AND CLAIMED TO HAVE BEEN PAID O N OUTSTANDING AMOUNT AS PER WORKING AT PAGE 5 OF TH A .O. SAME WOULD ONLY BECOME ACADEMIC IN VIEW OF OUR ABOV E FINDING THAT THE ENTIRE ADDITION OF RS. 35 LAKHS HA S BEEN DELETED. THERE IS NO EVIDENCE ON RECORD TO SUGGEST THAT 12 THE ASSESSEE HAD ACTUALLY PAID SUCH AN AMOUNT AS IN TEREST OUT OF UNDISCLOSED INCOME. ACCORDINGLY THIS AMOUN T IS ALSO DELETED. 6. THE A.O. HAS FURTHER MADE AN ADDITION OF RS. 1 20 000/- U/S 68 OF THE ACT. THIS ADDITION HAS BE EN DELETED BY THE LD. CIT(A). 7. FACTS OF THIS ISSUE ARE THAT THE ASSESSEE HAS CL AIMED CASH CREDITS OF RS. 50 000/- IN THE NAME OF SHRI M. K. SAMOTA AND RS. 70 000/- IN THE NAME OF SHRI M.L. SE THIA. THE A.O. WANTED THEM TO BE PRODUCED IN PERSON FOR EXAMINATION. THE ASSESSEE FAILED TO PRODUCE THEM. THEREFORE THE A.O. TREATED THEM AS UNEXPLAINED AND ADDED THE ENTIRE AMOUNT OF RS. 1 20 000/- IN ASSESS EES HANDS. HOWEVER THE LD. CIT(A) HAS DELETED THIS AD DITION. 8. BEFORE US BOTH THE PARTIES HAVE TAKEN SIMILAR ARGUMENTS AS WERE TAKEN BEFORE THE LD. CIT(A). WE HAVE FOUND THAT DURING THE ASSESSMENT PROCEEDINGS THE AS SESSEE 13 HAD SUBMITTED CONFIRMATION OF STATEMENT OF ACCOUNT FROM BOTH THE CASH CREDITORS MENTIONING THEIR PAN. COPI ES OF THEIR BANK ACCOUNT DEBITING THEE ENTRIES OF ADVANCE MADE HAVE ALSO BEEN FILED. THE TRANSACTIONS WERE THROUGH BANKING CHANNELS. SIMPLY NON-PRODUCTION OF CREDITO RS IN PERSON IS NOT FATAL. THEREFORE WE DO NOT FIND ANY MERIT IN THIS GROUND OF REVENUE AS THE IDENTITY GENUINENESS OF THE TRANSACTION AS WELL AS THE CREDIT WORTHINESS OF THE CASH CREDITORS STAND DISCHARGED. BOTH THE CREDITORS ARE INCOME- TAX ASSESSEES. THE A.O. HAS NO REASONED AS TO WHY THEIR CREDITWORTHINESS IS NOT PROVED. ACCORDINGLY WE DI SMISS GROUND NO 2. AS WELL. 5. IN THE RESULT THE APPEAL OF THE REVENUE IS DISM ISSED. ORDER PRONOUNCED IN THE COURT ON 31 ST OCTOBER 2013. SD/- SD/- (N.K.SAINI) [HARI OM MARATHA] ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 31 ST OCTOBER 2013 VL/- 14 COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT BY ORDER 4. THE CIT(A) 5. THE DR ASSISTANT REGISTRAR ITAT JODHPUR