Om Prakash Arora, v. ACIT Circle 31 (1),

ITA 648/DEL/2007 | 1999-2000
Pronouncement Date: 31-03-2010 | Result: Allowed

Appeal Details

RSA Number 64820114 RSA 2007
Assessee PAN ACCPA9774F
Bench Delhi
Appeal Number ITA 648/DEL/2007
Duration Of Justice 3 year(s) 1 month(s) 21 day(s)
Appellant Om Prakash Arora,
Respondent ACIT Circle 31 (1),
Appeal Type Income Tax Appeal
Pronouncement Date 31-03-2010
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted G
Tribunal Order Date 31-03-2010
Date Of Final Hearing 24-02-2010
Next Hearing Date 24-02-2010
Assessment Year 1999-2000
Appeal Filed On 09-02-2007
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH `G : NEW DELHI) BEFORE SHRI I.P. BANSAL JUDICAL MEMBER AND SHRI K.D. RANJAN ACCOUNTANT MEMBER ITA NO.648/DEL./2007 (ASSESSMENT YEAR : 1999-2000) SHRI OM PRAKASH ARORA VS. ACIT CIRCLE 31(1) M-3 FLAT NO.103 AVG BHAVAN NEW DELHI. CONNAUGHT CIRCUS NEW DELHI. (PAN/GIR NO.ACCPA9774F) AND ITA NO.1203/DEL./2007 (ASSESSMENT YEAR : 1999-2000) ACIT CIRCLE 31(1) VS. SHRI OM PRAKASH ARORA NEW DELHI. NEW DELHI. (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI C.S. AGGARWAL/RAJ PARTAP MALL A DV. REVENUE BY : SHRI GAJANAND MEENA CIT(DR) ORDER PER K.D. RANJAN : THESE CROSS APPEALS BY THE ASSESSEE AND THE REVENU E ARISE OUT OF THE ORDER OF THE LD.COMMISSIONER OF INCOME-TAX(APPEALS)-XVII NEW DE LHI. THESE APPEALS WERE HEARD TOGETHER AND FOR THE SAKE OF CONVENIENCE ARE DISPOS ED OF BY THIS COMMON ORDER. ITA NO.648/DEL./2007 (ASSESSEES APPEAL) 2. THE ONLY ISSUE FOR CONSIDERATION RELATES TO CONF IRMING THE ADDITION OF RS.4 LAKHS RECEIVED FROM MRS. RATNA GILL AS UNEXPLAINED INVEST MENT. THE RELEVANT GROUND OF APPEAL IS REPRODUCED AS UNDER: ITA NO.648/DEL./2007 & ITA NO.1203/DEL./2007 (AY : 199-2000) 2 BECAUSE THE LD.CIT(A) ERRED IN LAW AS WELL AS ON F ACTS WHILE CONFIRMING ADDITION OF RS.4 LAKHS RECEIVED FORM MRS. RATNA GIL L AS UNEXPLAINED INVESTMENT BY OVERLOOKING AND IN REJECTING THE DETAILS STATEME NT OF FACTS SUBMITTED ALONG WITH VARIOUS DOCUM3ENTSA PLACED IN PAPER BOOK FILED AND ALSO EXPLAINED IN DETAIL THAT THE ASSESSEE AHS RECEIVED RS.4 LAKH AS FRIENDLY LOA N FROM MRS. RATNA GILL. 3. THE FACTS OF THE CASE STATED IN BRIEF ARE THAT T HE ASSESSEE RECEIVED RS.4 LAKHS IN A SAVINGS BANK ACCOUNT NO.320123012 WITH AMERICAN EXP RESS BANK ON 15.1.1999 WHICH WAS CLAIMED TO BE A FRIENDLY LOAN FORM MRS. RATNA G ILL. THE ASSESSEE FILED CONFIRMATION FORM MRS. RATNA GILL WITHOUT PAN AND COPY OF STATEM ENT OF MRS. RATNA GILL. THE AO RECORDED A STATEMENT ON OATH U/S 131 OF THE ACT ON 29.03.2006 WHEREIN IT WAS SUBMITTED BY THE ASSESSEE THAT MRS. RATNA GILL WAS NOT AN INC OME-TAX ASSESSEE. SINCE FURTHER TIME WAS NOT ALLOWABLE AS THE ASSESSMENT WAS GOING TO BE BARRED BY LIMITATION ON 30.3.2006. THE AO TREATED THE AMOUNT OF RS.4 LAKH CREDITED IN THE BANK ACCOUNT AS UNEXPLAINED MONEY U/S 69A OF THE ACT. 4. BEFORE CIT(A) IT WAS SUBMITTED THAT MRS. RATNA GILL HAD FILED HER CONFIRMATION DURING THE COURSE OF ASSESSMENT PROCEEDINGS GIVING COMPLETE PARTICULARS OF CHEQUE SINCE THE PAYMENT HAD BEEN MADE THROUGH CHEQUE. BEFORE C IT(A) A CONFIRMATION FROM HER HUSBAND WAS ALSO FILED ACCORDING TO WHICH THE PAYME NT WAS MADE THROUGH JOINT ACCOUNT HELD BY MRS. RATNA GILL WITH HER HUSBAND AND THAT H ER HUSBAND WAS AN INCOME-TAX ASSESSAEE. THE PAYMENT WAS MADE OUT OF HIS ACCOUNT IN WHICH PENSION BENEFITS STOOD DEPOSITED. THE CIT(A) HOWEVER NOTED THAT DURING THE COURSE OF ASSESSMENT PROCEEDINGS THE ASSESSEE HAD CLAIMED THAT THE AMOU NT WAS RECEIVED FORM MRS. RATNA GILL OUT OF HER BANK ACCOUNT WHEREAS DURING THE APPELLAT E PROCEEDINGS IT WAS CLAIMED THAT THE AMOUNT WAS RECEIVED OUT OF PENSION BENEFITS OF HER HUSBAND. SINCE THERE WAS CONTRADICTION BETWEEN THE STAND TAKEN BEFORE THE AO AND THE CIT(A) THE CIT(A) CAME TO CONCLUSION THAT THE AMOUNT OF RS.4 LAKHS WAS NOT GE NUINE. ACCORDINGLY THE ADDITION MADE BY THE AO WAS UPHELD. 5. BEFORE US LD.AR OF THE ASSESSEE SUBMITTED THAT THE CONFIRMATION FROM SMT. RATNA GILL WAS FILED STATING THEREIN THAT A FRIENDLY LOAN FREE OF INTEREST WAS ADVANCED VIDE CHEQUE NO.235117 DRAWN ON PUNJAB & SIND BANK. LD.A R OF THE ASSESSEE ALSO SUBMITTED THAT THE HUSBAND OF MRS. RATNA GILL HAD MADE PAYMEN T VIDE CHEQUE NO.235117 OUT OF ITA NO.648/DEL./2007 & ITA NO.1203/DEL./2007 (AY : 199-2000) 3 JOINT ACCOUNT. LD.AR OF THE ASSESSEE FURTHER SUBMI TTED THAT AS PER COPY OF BANK STATEMENT PLACED AT PAGE 180 OF THE PAPER BOOK AMOUNT WAS PA ID TO THE ASSESSEE FORM JOINT ACCOUNT WITH HER HUSBAND. ON THE OTHER HAND LD.CIT(DR) SU PPORTED THE ORDER OF AO. 6. WE HAVE HEARD BOTH THE PARTIES AND GONE THROUGH THE MATERIAL AVAILABLE ON RECORD. WE HAVE ALSO GONE THROUGH BANK ACCOUNT WITH PUNJAB & SIND BANK STANDING IN JOINT NAME OF MRS. RATNA GILL AND HER HUSBAND BRIG. NIKHI L SINGH GILL. FROM THE BANK ACCOUNT WE FIND THAT AN AMOUNT OF RS.4 LAKHS VIDE CHEQUE 235117 HAS BEEN CLEARED ON 15.1.1999. THE CONTENTS OF CONFIRMATION FILED BY TH E ASSESSEE STANDS VERIFIED FROM THE JOINT BANK ACCOUNT OF MRS RATNA GILL HELD JOINTLY W ITH HER HUSBAND. THEREFORE IN OUR CONSIDERED OPINION THE AMOUNT OF RS.4 LAKHS RECEIV ED FROM MRS. RATNA GILL STANDS PROVED. WE ACCORDINGLY SET ASIDE THE ORDER OF THE CIT(A) AND DIRECT THE AO TO ALLOW NECESSARY RELIEF. 7. IN THE RESULT THE APPEAL FILED BY THE ASSESSEE IS ALLOWED. ITA NO.1203/DEL./2007 (REVENUES APPEAL) THE GROUNDS OF APPEAL RAISED BY THE REVENUE IN THIS APPEAL ARE AS UNDER: 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E THE CIT(A) HAS ERRED IN DELETING THE ADDITION OF RS.1 00 86 300/- MADE ON A CCOUNT OF UNEXPLAINED INVESTMENT IN THE PURCHASE OF PROPERTY. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E THE CIT(A)-XVII NEW DELHI HAS ERRED IN IGNORING THE VALUE DETERMINED BY DISTRICT VALUATION OFFICER. 3. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E THE CIT(A)-XVII ERRED IN DELETING THE ADDITION OF RS.68 84 261/- MADE U/S 69-A OF THE I.T. ACT. 4. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E THE LD. CIT(A)-XVII ERRED IN DELETING THE ADDITION OF RS.68 84 261/- B EING RE-PAYMENT OF LOAN WHICH WAS NOT DISCLOSED AS DEBTOR IN THE BOOKS OF A CCOUNTS OF EARLIER YEAR OF THE ASSESSEE. 5. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E THE CIT(A)-XVII ERRED IN DELETING ADDITION OF RS.83 04 976/-(RS.76 04 946 /- + RS.700030/-) MADE U/S 69-A OF THE I.T. ACT. 6. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E THE CIT(A)-XVII ERRED IN DELETING ADDITION OF RS.83 04 976/- (RS.76 04 94 6/- +7 00 030/-) BEING RECEIPT AGAINST SALE OF SHARES WHICH WERE NOT COMP LETELY OWNED BY THE ASSESSEE. ITA NO.648/DEL./2007 & ITA NO.1203/DEL./2007 (AY : 199-2000) 4 7. ON THE FACTS AND CIRCUMSTANCES OF THE CASE THE CIT(A)-XVII ERRED IN DELETING THE ADDITION OF RS.16.00 LAKH MADE BY THE AO U/S 69A OF THE I.T. ACT. 8. THE FIRST ISSUE FOR CONSIDERATION CONTAINED IN G ROUND NOS.1 & 2 RELATES TO DELETING THE ADDITION OF RS.1 00 86 300 ON ACCOUNT OF UNEXPL AINED INVESTMENT IN THE PURCHASE OF PROPERTY. 9. THE FACTS OF THE CASE STATED IN BRIEF ARE THAT D URING THE ASSESSMENT YEAR UNDER CONSIDERATION THE ASSESSEE PURCHASED A BUILDING BE ARING NO. C-20 NDSE-II NEW DELHI BY TWO SALE DEEDS ENTERED INTO DURING THE YEAR FOR TOTAL CONSIDERATION OF RS.83 LAKHS IN CO-OWNERSHIP WITH HIS WIFE SMT. MADHU ARORA. IN TH E VIEW OF THE AO THE CONSIDERATION OF THE PROPERTY DECLARED BY THE ASSESSEE WAS UNDERS TATED AND ACCORDINGLY A REFERENCE WAS MADE TO THE DEPARTMENTAL VALUATION OFFICER (DVO) FO R DETERMINING ITS MARKET VALUE. THE DVO VIDE HIS REPORT DATED 21.3.2006 VALUED THE PROPERTY AT RS.2 84 72 600/-. THE AO REQUIRED THE ASSESSEE TO SHOW-CAUSE AS TO WHY 50 % OF DIFFERENCE OF RS.2 84 72 600/- SHOULD NOT BE ADDED TO THE TAXABLE INCOME OF THE AS SESSEE AS UNEXPLAINED INVESTMENT IN THE PROPERTY. THE ASSESSEE FILED HIS EXPLANATION AL ONG WITH A REPORT FORM REGISTERED VALUER WHICH WAS HOWEVER REJECTED BY THE AO BY HO LDING THAT REPORT OF DVO WAS MORE RELIABLE THAN THE REPORT OF THE REGISTERED VALUER C ONSIDERING THE LOCATION OF THE PROPERTY. THE AO ACCORDINGLY HELD THAT TOTAL INVESTMENT MADE BY THE ASSESSEE IN THIS IMMOVEABLE PROPERTY ALONG WITH HIS WIFE WAS RS.2 84 72 600/- A S DETERMINED BY THE DVO. 50% OF DIFFERENCE AMOUNTING TO RS.1 00 86 300/- WAS THUS A DDED TO THE TOTAL INCOME OF THE ASSESSEE. 10. BEFORE CIT(A) THE ADDITION WAS AGITATED BY TH E ASSESSEE. IT WAS SUBMITTED THAT THERE WERE CERTAIN INFIRMITY IN THE VALUATION REPOR T OF DVO. IT WAS POINTED OUT THAT DVO HAD ERRED IN DETERMINING THE FAIR MARKET VALUE OF T HE PROPERTY IN FY 1998-99 ON THE BASIS OF SALE INSTANCE IN FY 1995-96. THE DVO HAD FAILED TO ACCOUNT FOR THE FACT THAT THE PROPERTY PRICE IN 1995-96 WERE AT ITS PEAK AND IN F Y 1998-99 THEY HAD FALLEN CONSIDERABLY. THAT THE SALE INSTANCE FURNISHED BY THE ASSESSEE WERE IN RESPECT OF PROPERTIES IN THE SAME AREA WHICH WAS ENTERED INTO DURING THE SAME PERIOD AND THAT THESE TRANSACTIONS BEING MORE REPRESENTATIVE OF EXISTING MARKET PRICE OF THE PROPERTY OF THAT AREA DURING FY 1998-99 WERE BETTER INDICATOR OF FAI R MARKET VALUE OF THE PROPERTY DURING ITA NO.648/DEL./2007 & ITA NO.1203/DEL./2007 (AY : 199-2000) 5 THE YEAR UNDER CONSIDERATION. THE VALUATION REPORT OF REGISTERED VALUER WAS ALSO FILED SHOWING THAT THE FAIR MARKET VALUE OF THE PROPERTY DURING THE INSTANT YEAR WAS RS.80.50 LAKHS. IT WAS ALSO SUBMITTED THAT SALE CONSIDERATI ON OF PROPERTY WAS DULY RECORDED IN THE REGISTERED SALE DEED WHEREIN THE PARTICULARS OF BO TH THE PURCHASER AS WELL AS SELLER WERE DULY FURNISHED AND THE AO ERRED IN ARBITRARILY REJE CTING THE SALE EVEN THOUGH THE SELLER HAS ALSO CONFIRMED THE SALE CONSIDERATION FOR THE SALE OF PROPERTY. IT WAS ALSO CONTENDED THAT EVEN DURING THE COURSE OF SEARCH AT THE PREMISES OF THE ASSESSEE NO MATERIAL WAS FOUND INDICATING ANY SUPPRESSION OF PURCHASE CONSIDERATIO N. THEREFORE THE AO DID NOT HAVE ANY VALID BASIS FOR MAKING REFERENCE U/S 142A OF TH E ACT. FURTHER NO MATERIAL WAS BROUGHT ON RECORD BY THE AO ON THE BASIS OF WHICH I T COULD BE SAID THAT ANY AMOUNT OVER AND ABOVE THE DECLARED SALE CONSIDERATION WAS PAID FOR THE PURCHASE OF IMPUGNED PROPERTY. IT WAS ALSO SUBMITTED THAT THE FACTS POI NTED BY THE ASSESSEE IN THE VALUATION REPORT HAD NOT BEEN PROPERLY APPRECIATED BY THE AO. FURTHER LD.AR OF THE ASSESSEE SUBMITTED THAT IT WAS A SETTLED PRINCIPLE OF LAW TH AT A VALUATION REPORT OF THE DVO IS ONLY AN OPINION WHICH HAS TO BE FOLLOWED IN THE BACKDROP OF THE FACTS OF THE CASE AND COULD NOT BE ACCEPTED AS GOSPEL TRUTH. HE ALSO CONTENDED THA T NO ADDITION COULD BE VALIDLY MADE U/S 69B OF THE ACT MERELY DUE TO THE DIFFERENCE BETWEEN THE DVO AND THE AMOUNT EXPENDED ON PURCHASE OF INVESTMENT. IT WAS ALSO SUBMITTED T HAT SUBSEQUENTLY THE PROPERTY WAS SOLD DURING THE YEAR 2004-05 FOR A TOTAL SALE CONSIDERAT ION OF RS.1 CRORE AND SUCH SALE CONSIDERATION STOOD ACCEPTED BY THE AO HIMSELF WHIL E COMPLETING ASSESSMENT FOR AY 2004-05. THEREFORE THE VALUE OF PROPERTY WHICH WA S SOLD FOR RS.1 CRORE AND ACCEPTED BY THE AO COULD NOT BE VALUED AT RS.2 84 72 600/- IN A Y 1999-2000. 11. THE CIT(A) CONSIDERED THE SUBMISSIONS MADE BY THE ASSESSEE. HE EXAMINED THE MATTER IN DETAIL. HE WAS OF THE OPINION THAT AO HA D BASED THE ADDITION MERELY ON THE BASIS OF DEPARTMENTAL VALUATION REPORT. NO MATERIA L WAS BROUGHT ON RECORD BY THE AO ON THE BASIS OF WHICH IT COULD BE SAID THAT ANY AMOUNT OVER AND ABOVE THE DECLARED SALE CONSIDERATION WAS PAID FOR THE PURCHASE OF IMPUGNED PROPERTY. HE ALSO NOTED THAT DURING THE COURSE OF SEARCH NO MATERIAL WAS FOUND INDICATI NG ANY SUPPRESSION OF PURCHASE CONSIDERATION. THEREFORE ACCORDING TO THE CIT(A) THE ASSESSEE HAD SUCCESSFULLY REBUTTED THE BASIS ON WHICH THE DVO HAD PREPARED THE REPORT. IT WAS ALSO OBSERVED THAT ONUS TO PROVE THAT THE ASSESSEE HAD SPENT MORE MONEY WAS ON THE AO AS HELD IN THE CASE OF ITA NO.648/DEL./2007 & ITA NO.1203/DEL./2007 (AY : 199-2000) 6 NARESH KUMAR KHATTER (HUF) BY HONBLE DELHI HIGH CO URT REPORTED IN 261 ITR 664. THE CIT(A) ALSO PLACED RELIANCE ON THE DECISION OF HONBLE SUPREME COURT IN THE CASE OF K.P. VARGHESE VS. ITO 131 ITR 597 WHEREIN IT HAS BEEN HELD THAT THE BURDEN OF PROVING UNDERSTATEMENT OR CONCEALMENT WAS ON REVENUE. IT WAS FOR THE REVENUE TO SHOW THAT CONSIDERATION FOR TRANSFER OF CAPITAL ASSET HAD BEE N UNDERSTATED BY THE ASSESSEE. THE CIT(A) ALSO PLACED RELIANCE ON VARIOUS DECISIONS. HE WAS OF THE OPINION THAT REVENUE HAD FAILED TO ADDUCE ANY MATERIAL ON RECORD TO ESTA BLISH UNDERSTATEMENT OF CONSIDERATION IN THE SALE DOCUMENT. THEREFORE THE ADDITION MADE ON THE BASIS OF DVO REPORT WAS NOT JUSTIFIED. HE ACCORDINGLY AFTER DETAILED DISCUSSIO N DELETED THE ADDITION OF RS.1 00 86 300/-. 12. BEFORE US LD.CIT(DR) SUBMITTED THAT DVOS REPO RT IS EXPERT OPINION WHICH IS PERMISSIBLE EVIDENCE. THE VALUATION OFFICER HAS GI VEN HIS REPORT ON THE BASIS OF SALE INSTANCE. THE CIT(A) WAS NOT EXPERT. HE PLACED RE LIANCE ON THE DECISION OF ITAT DELHI BENCH IN THE CASE OF HANEMP PROPERTIES PVT. LTD. VS . ACIT 101 ITD 19 FOR THE PROPOSITION THAT REFERENCE U/S 142A COULD BE MADE T O DVO FOR THE PURPOSE OF VALUATION OF THE PROPERTY. THE REPORT OF DVO IS ADMISSIBLE A S AN EVIDENCE. ON THE OTHER HAND LD.COUNSEL FOR THE ASSESSEE SUBMITTED THAT NO EVIDE NCE IN SUPPORT OF CONTENTION THAT HIGHER AMOUNT WAS INVESTED HAS BEEN BROUGHT ON RECO RD. THE REGISTERED VALUERS REPORT HAS BEEN IGNORED. THE REPORT OF VALUATION OFFICER WAS MADE AVAILABLE ON 26.3.2006. THE ASSESSEE GAVE REPLY WHICH HAS BEEN IGNORED. THE PR OPERTY WAS REGISTERED AT RS.83 LAKHS. UNLESS THERE IS DIRECT EVIDENCE TO SHOW THAT INVES TMENT HAS BEEN UNDERSTATED NO ADDITION CAN BE MADE ON THE BASIS OF MERE VALUATION REPORT G IVEN BY THE DVO. THE ASSESSEE HAS ADMITTED THAT THE VALUE OF PROPERTY AS PER REGISTER ED DOCUMENT ON WHICH STAMP DUTY HAS BEEN DULY PAID. NO ATTEMPT HAS BEEN MADE BY THE RE VENUE IN CASE OF OTHER FOUR SELLERS THAT THEY HAVE RECEIVED EXCESS AMOUNT. THE MATTER WAS NOT EXAMINED AT ALL. THERE WAS NO MATERIAL ON RECORD TO SAY THAT EXTRA CONSIDERATI ON WAS RECEIVED BY THE SELLERS. THEREFORE THE ADDITION COULD NOT BE MADE MERELY ON THE BASIS OF REPORT OF DVO. HE FURTHER SUBMITTED THAT IN AY 2004-05 THE SALE CONS IDERATION OF RS.1 CRORE HAS BEEN ACCEPTED BY THE SAME AO. THEREFORE THE ADDITION C OULD NOT BE MADE IN THE YEAR UNDER CONSIDERATION MERELY ON THE BASIS OF VALUATION REPO RT. HE PLACE RELIANCE ON THE DECISION ITA NO.648/DEL./2007 & ITA NO.1203/DEL./2007 (AY : 199-2000) 7 OF CIT VS. NARESH KUMAR KHATTER (SUPRA) FOR THE PR OPOSITION THAT IN ORDER TO INVOKE THE PROVISIONS OF SECTION 69B THE BURDEN IS ON REVENUE TO PROVE THAT REAL INVESTMENT EXCEEDS THE INVESTMENT SHOWN IN THE BOOKS OF ACCOUN T OF THE ASSESSEE. 13. WE HAVE HARD BOTH THE PARTIES AND GONE THROUGH THE MATERIAL AVAILABLE ON RECORD. FROM THE FACTS STATED ABOVE IT IS CLEAR THAT AO HA D MADE ADDITION MERELY ON THE BASIS OF VALUATION REPORT OF THE DVO. THE PROPERTY WHICH WA S PURCHASED BY THE ASSESSEE FOR RS.83 LAKH IN 1999 WAS SOLD IN AY 2004-05 FOR RS.1 CRORE. THE AO HAS NOT BROUGHT ON RECORD ANY MATERIAL TO SHOW THAT EXTRA INVESTMENT W AS MADE BY THE ASSESSEE. THE PROPERTY HAS BEEN REGISTERED ON WHICH STAMP DUTY AS PER RATE APPLICABLE HAS BEEN PAID. HONBLE DELHI HIGH COURT IN THE CASE OF CIT VS. NAR ESH KUMAR KHATTER (SUPRA) HAS HELD THAT THE BURDEN IS ON REVENUE TO PROVE THAT THE REA L INVESTMENT EXCEEDED THE INVESTMENT SHOWN IN THE BOOKS OF ACCOUNT. IN THE ABSENCE OF A NY SUCH MATERIAL ADDITION COULD NOT BE MADE. IN THE CASE BEFORE US THE AO HAD NOT BRO UGHT ANY MATERIAL ON RECORD AND THEREFORE IN OUR CONSIDERED OPINION CIT(A) WAS JU STIFIED IN DELETING THE ADDITION. ACCORDINGLY WE DO NOT FIND ANY INFIRMITY IN THE OR DER PASSED BY THE CIT(A) DELETING THE ADDITION. 14. THE NEXT ISSUE FOR CONSIDERATION WHICH IS CONTA INED IN GROUND NOS.3 & 4 RELATES TO DELETING THE ADDITION OF RS.68 84 261/- MADE U/S 69 A OF THE ACT. THE AO MADE ADDITION OF RS.68 84 261/- ON ACCOUNT OF REPAYMENT OF LOAN B Y M/S QUANTUM SECURITIES PVT. LTD. M/S QUANTUM SECURITIES PVT. LTD. WAS A RELATED CONC ERN OF THE ASSESSEE. THE ASSESSEE HAD BUSINESS TRANSACTIONS AS WELL AS LOAN TRANSACTION W ITH M/S QUANTUM SECURITIES PVT. LTD. THE ASSESSEE WAS ENGAGED IN BUYING AND SELLING OF S HARES AND SECURITIES THROUGH M/S QUANTUM SECURITIES PVT. LTD. WHICH WAS A MEMBER OF NATIONAL STOCK EXCHANGE. AN AMOUNT AGGREGATING TO RS.68 84 261/- REPRESENTED 8 AMOUNTS RECEIVED BY THE ASSESSEE BY WAY OF CHEQUE ON 8 DIFFERENT DATES FORM M/S QUANTUM SECURITIES PVT. LTD. THE CONFIRMATION WAS FILED BY THE ASSESSEE IN SUPPORT O F THE NATURE SOURCE AND GENUINENESS OF AMOUNT WHICH WAS DISBELIEVED BY THE AO ON THE GROUN D THAT M/S QUANTUM SECURITIES PVT. LTD. WAS A RELATED CONCERN AND THE ASSESSEE DI D NOT FILE COPY OF FULL LOAN ACCOUNT WITH M/S QUANTUM SECURITIES PVT. LTD. IT WAS ALSO A GROUND THAT AMOUNT SHOWN AS REPAYMENT WAS CLAIMED TO HAVE BEEN ADVANCED BY THE ASSESSEE IN EARLIER YEARS. THE ITA NO.648/DEL./2007 & ITA NO.1203/DEL./2007 (AY : 199-2000) 8 ASSESSEE WAS NOT FILING PERSONAL BALANCE SHEET WITH THE RETURN OF INCOME. UNDER THESE CIRCUMSTANCES THE AO HELD THAT THE NATURE SOURCE AND GENUINENESS OF AMOUNT WAS NOT PROVED. HE ACCORDINGLY MADE ADDITION OF RS.68 84 2 61/-. 15. BEFORE CIT(A) IT WAS EXPLAINED THAT THE ASSESS EE WAS HAVING TRANSACTIONS WITH M/S QUANTUM SECURITIES PVT. LTD. THERE WAS LOAN A CCOUNT AND BUSINESS TRANSACTION ACCOUNT BETWEEN THE ASSESSEE AND M/S QUANTUM SECURI TIES PVT. LTD. THE ASSESSEE WAS NOT MAINTAINING INDIVIDUAL BOOKS OF ACCOUNT AND HAD NOT BEEN PREPARING BALANCE SHEET WHICH WAS A MATTER OF RECORD. THE CIT(A) IN VIEW O F THESE FACTS WAS OF THE OPINION THAT TRANSACTIONS IN QUESTION STOOD CONFIRMED BY M/S QUA NTUM SECURITIES PVT. LTD. WHICH HAS FILED CONFIRMATION ON TWO ACCOUNTS I.E. CONFIRMATIO N WITH REGARD TO A REPAYMENT OF LOAN AS STOOD RECORDED IN THEIR BOOKS OF ACCOUNT AS ALSO WITH REGARD TO THE BUSINESS TRANSACTIONS REPRESENTING PURCHASE/SALE OF SHARES O N BEHALF OF ASSESSEE AS DULY RECORDED IN THE BOOKS OF M/S QUANTUM SECURITIES PVT. LTD. M/S QUANTUM SECURITIES PVT. LTD. HAD FURNISHED THEIR CONFIRMATION ALONG WITH COMPLETE AD DRESS AND INCOME-TAX PARTICULARS. THE CIT(A) ON APPRECIATION OF THE FACTS WAS OF THE OPINION THAT ALL THE TRANSACTIONS WERE MADE THROUGH BANKING CHANNELS. ANY SUCH INTEREST F REE ADVANCES WERE THROUGH ACCOUNT PAYEE CHEQUES AND HAVE ALSO BEEN RECEIVED BACK THRO UGH ACCOUNT PAYEE CHEQUES. THIS POSITION HAD ALSO BEEN VERIFIED BY AO IN INDEPENDEN T ENQUIRY CARRIED OUT BY HIM FROM AMERICAN EXPRESS BANK THE BANKERS OF THE ASSESSEE. ONCE IT WAS CONFIRMED AND VERIFIED THAT THE PAYMENTS HAD COME FROM M/S QUANTUM SECURIT IES PVT. LTD. ON ACCOUNT OF REPAYMENT OF INTEREST FREE ADVANCES GIVEN TO THEM AS ALSO ON ACCOUNT OF SHARE TRANSACTIONS THEN IN SUCH A CASE IT WAS CLEAR THAT M/S QUANTUM SECURITIES PVT. LTD. HAD DULY SPECIFIED THE MANNER IN WHICH THESE PAYMENTS W ERE CLASSIFIED IN THEIR BOOKS OF ACCOUNT. THE CIT(A) ALSO OBSERVED THAT M/S QUANTUM SECURITIES PVT. LTD. VIDE THEIR LETTER DATED 29.3.2006 HAD STATED THAT THEY HAVE RECEIVED LOANS IN QUESTION AS ADVANCED BY THE ASSESSEE AND SUBSEQUENTLY REPAID TO THE ASSESSEE. THE AO THEREFORE WAS HELD NOT TO BE JUSTIFIED IN IGNORING OR BRUSHING ASIDE THE EVIDENC E WITHOUT POSITIVELY REBUTTING OR REFUTING THE SAME. HE ALSO OBSERVED THAT HE COULD NOT LOSE SIGHT OF THE FACT THAT SUCH TRANSACTION BETWEEN THE ASSESSEE AND M/S QUANTUM SE CURITIES PVT. LTD. PRIOR TO 19.10.1998 AND AFTER 31.3.1999 HAVE BEEN ACCEPTED B Y THE AO WHILE FRAMING ASSESSMENT U/S 153A OF THE ACT FOR THE INSTANT YEAR AS WELL AS EARLIER YEAR AND ALSO SUBSEQUENT ITA NO.648/DEL./2007 & ITA NO.1203/DEL./2007 (AY : 199-2000) 9 ASSESSMENT YEAR. THEREFORE THE APPROACH OF THE AO WAS SELF-CONTRADICTORY. THE CIT(A) ON THE BASIS OF ABOVE DELETED THE ADDITION. 16. BEFORE US LD.CIT(DR) SUBMITTED THAT THE LOAN G IVEN IN EARLIER YEARS HAS NOT BEEN SUBSTANTIATED. COPY OF BANK ACCOUNT WAS NOT FILED. THEREFORE THE LOAN GIVEN IN EARLIER YEARS HAS NOT BEEN PROVED. ON THE OTHER HAND LD.A R OF THE ASSESSEE SUPPORTED THE ORDER OF THE CIT(A). 15. WE HAVE HEARD BOTH THE PARTIES AND GONE THROUGH THE MATERIAL AVAILABLE ON RECORD. THE CIT(A) HAS RECORDED A FINDING THAT IN CONFIRMATION GIVEN BY M/S QUANTUM SECURITIES PVT. LTD. THE RECEIPT OF INTEREST FREE ADVANCES HAS BEEN CONFIRMED. THE TRANSACTIONS HAVE BEEN MADE THROUGH BANKING CHANNEL S. HE ALSO RECORDED A FINDING THAT IN THE REMAND REPORT THE AO HAS NOT DISPUTED THE F ACT THAT THE AMOUNTS IN QUESTION HAVE BEEN ACTUALLY RECEIVED BY THE ASSESSEE THROUGH ACCO UNT PAYEE CHEQUES FORM M/S QUANTUM SECURITIES PVT. LTD. THE AO HAS ALSO CONFIRMED THE FACT THAT FROM THE BANKERS OF THE ASSESSEE NAMELY AMERICAN EXPRESS BANK WHO HAVE CON FIRMED TO HIM THAT ALL THE PAYMENTS HAD ACTUALLY BEEN RECEIVED THROUGH ACCOUNT PAYEE CHEQUES. THE NUMBERS WHEREOF HAVE BEEN PROVIDED AND THE SAME WERE FOUND TO TALLY WITH THE CONFIRMATION GIVEN BY M/S QUANTUM SECURITIES PVT. LTD. FROM THE FACTS STATED IT IS CLEAR THAT THE REPAYMENT OF LOAN OF RS.68 84 261/- BY M/S QUANTUM SECURITIES PVT. LTD. STANDS PROVED. DURING THE COURSE OF THE HEARING LD.CIT(DR) HAS NO T BROUGHT ON RECORD ANYTHING TO PROVE THAT THE FINDINGS RECORDED BY CIT(A) ARE INCO RRECT. IN THE ABSENCE OF ANY SUCH MATERIAL IN OUR CONSIDERED OPINION LD.CIT(A) WAS JUSTIFIED IN DELETING THE ADDITION OF RS.68 84 261/-. HENCE NO INTERFERENCE IS CALLED F OR. 18. THE NEXT ISSUE FOR CONSIDERATION CONTAINED IN G ROUND NO.5 & 6 RELATES TO DELETING THE ADDITION OF RS.83 04 976/- MADE U/S 69 OF THE A CT. THE FACTS OF THE CASE STATED IN BRIEF ARE THAT DURING THE COURSE OF ASSESSMENT PROC EEDINGS THE ASSESSEE FILED CONFIRMATION FROM M/S QUANTUM SECURITIES PVT. LTD. THAT HE HAD R ECEIVED AMOUNT OF RS.76 04 496/- ON ACCOUNT OF SALE OF SHARES. IT WAS SUBMITTED THAT L ONG TERM AND SHORT TERM CAPITAL GAINS OF RS.33 334 AND RS.16 320/- RESPECTIVELY WAS ADMITTED . HOWEVER AS THE ASSESSEE COULD NOT PRODUCE THE EVIDENCES FOR PURCHASE OF SHARES OR HOLDING ALL THESE SHARES OR COPY OF ITA NO.648/DEL./2007 & ITA NO.1203/DEL./2007 (AY : 199-2000) 10 SHARE TRANSACTION ACCOUNT IN THE BOOKS OF M/S QUANT UM SECURITIES PVT. LTD. THE AO TREATED THE AMOUNT OF RS.76 04 946/- AS UNEXPLAINED MONEY INTRODUCED IN THE BOOKS OF ACCOUNT. 19. BEFORE THE CIT(A) IT WAS EXPLAINED THAT THE IS SUE REGARDING LONG TERM CAPITAL GAIN AND SHORT TERM CAPITAL GAIN WAS NOT IN DOUBT AS THE SAME WAS ACCEPTED BY THE AO. THE ONLY DOUBT RAISED BY THE AO WHILE PASSING THE ASSES SMENT ORDER WAS REGARDING THE SOURCE OF CREDIT IN THE BANK ACCOUNT OF THE ASSESSEE WHICH WAS DULY EXPLAINED WITH REFERENCE TO CONFIRMATION OF M/S QUANTUM SECURITIES PVT. LTD. T HE BILLS OF SALE AND PURCHASE OF SHARES AS ALSO THE STATEMENT OF SHARE TRADING ACCOUNT IN T HE BANK STATEMENT OF THE ASSESSEE. THERE WAS NO JUSTIFICATION TO DRAW ANY ADVERSE INFE RENCE OF THAT IN THIS ACCOUNT. 20. AS REGARDS THE BALANCE AMOUNT OF RS.7 00 000/- OUT OF RS.7 00 030/- IT HAS BEEN EXPLAINED THAT THE SAME WAS ALSO RECEIVED FORM M/S QUANTUM SECURITIES PVT. LTD. BUT IT WAS ONLY DUE TO AN INADVERTENT AND CLERICAL ERROR A T THE END OF M/S QUANTUM SECURITIES PVT. LTD. THAT THE SAME WAS NOT INCLUDED IN THE CON FIRMATION FILED ON 29 TH MARCH 2006. IT WAS SUBSEQUENTLY FOUND BY THE APPELLANT THAT THE AM OUNT OF RS.7.00 LAKH HAD BEEN OMITTED FROM SUCH CONFIRMATION AND THEREAFTER A CON FIRMED COPY OF ACCOUNT WAS OBTAINED AND FILED IN APPELLATE PROCEEDINGS AND IT HAS BEEN PRAYED FOR ADMISSION UNDER RULE 46A. THE FACT REMAINS THAT THE AMOUNT HAS BEEN RECEIVED BY ACCOUNT PAYEE CHEQUE FORM M/S QUANTUM SECURITIES PVT. LTD. AND HAS BEEN DULY CONF IRMED BY THEM IN THE STATEMENT OF ACCOUNT GIVEN BY THEM. THE FACT OF HAVING RECEIVED THIS CHEQUE FORM M/S QUANTUM SECURITIES PVT. LTD. HAS BEEN INDEPENDENTLY VERIFIE D BY THE AO FROM THE BANKERS OF THE ASSESSEE ALSO AND THEREFORE ALSO NO ADVERSE INFEREN CE SHOULD BE DRAWN ON THIS ACCOUNT. 21. THE CIT(A) DELETED THE ADDITION BY OBSERVING AS UNDER: 4.3.5 COMING TO THE NEXT ADDITION OF RS.76 04 946/- MADE BY THE A.O. I FIND THAT THE SAME CONSISTS OF FIVE DIFFERENT AMOUNTS BE TWEEN 10 TH OCTOBER 1998 AND 16 TH OCTOBER 1998 REPRESENTING AMOUNTS ON ACCOUNT OF SH ARE TRANSACTIONS AS RECEIVED FROM QUANTUM SECURITIES PV T. LTD. THE A.O. NOTED THAT QUANTUM SECURITIES PVT. LTD. HAVE CONFIR MED THE TRANSACTION AND THE APPELLANT SUBMITTED SOME COPIES OF CONTRACT NOTES AND ALSO BILLS OF PURCHASE/SALE OF SHARES FOR WORKING OUT SHORT-TERM CAPITAL GAINS. THE A.O. HOWEVER DISBELIEVED THE EVIDENCE ADDUCED AND NOTED THAT THE APPELLANT COULD NOT PRODUCE ANY EVIDENCE FOR THE PURCHASE OF SHARES OR COPY OF SHARE TRANSACTION ACCOUNT IN THE BOOKS OF QUANTUM SECURIT IES PVT. LTD. HE ITA NO.648/DEL./2007 & ITA NO.1203/DEL./2007 (AY : 199-2000) 11 FURTHER NOTED THAT IN THE ABSENCE OF PERSONAL BALAN CE SHEET THE CLAIM THAT THE SHARES WERE HELD BY THE APPELLANT PRIOR TO THEI R DISPOSAL ALSO CANNOT BE VERIFIED AND THE CONFIRMATION FILED WAS A SELF SERV ING DOCUMENT OBTAINED FROM A RELATED CONCERN. HE THUS DISBELIEVED THE SUB MISSION AND EXPLANATION OF THE APPELLANT AND MADE THE IMPUGNED ADDITION. 4.3.6 THE ABOVE ADDITION HAS BEEN ASSAILED BY THE L EARNED A.R. IT HAS BEEN SUBMITTED THAT THE APPELLANT WAS NOT MAINTAINING PE RSONAL SET OF BOOKS OF ACCOUNT WHICH COULD HELP HIM IN FILING PERSONAL BAL ANCE SHEET. IT HAS FURTHER BEEN SUBMITTED THAT THE TRANSACTION IN QUES TION HAVE BEEN CONFIRMED BY QUANTUM SECURITIES PVT. LTD. SUPPORTED BY EVIDENCE IN THE FORM OF CONTRACT NOTES AS ALSO PURCHASE BILLS SALE S BILLS THE EVIDENCE ADDUCED HAS NOT BEEN REBUTTED OR REFUTED BY THE A.O . BY POINTING OUT ANY SPECIFIC DISCREPANCY IN THE SAME IN ANY MANNER. IT HAS BEEN SUBMITTED THAT QUANTUM SECURITIES PVT. LTD. IS REGULARLY ENGAGED I N THE BUSINESS OF SHARE TRANSACTION BEING MEMBER OF NATIONAL STOCK EXCHANG E. THE LEARNED A.R. HAS ALSO INVITED MY ATTENTION TO THE PAPER BOOK FIL ED WHEREIN INCOME FROM CAPITAL GAINS ON ACCOUNT OF ALL SUCH SHARE TRANSACT IONS IN QUESTION HAS BEEN WORKED OUT AND OFFERED FOR TAXATION BY THE APPELLAN T. HE HAS ALSO BROUGHT TO MY NOTICE THE DETAILS OF SUCH SHARE TRANSACTIONS AS PER THE PAPER BOOK FILED BEFORE THE A.O. ON THE BASIS OF WHICH CAPITA L GAINS IN QUESTION HAVE BEEN WORKED OUT. THERE IS NO DENYING THE FACT THAT THE A.O. HAS ACCEPTED THE WORKING OF THE CAPITAL GAINS AND ASSESSED THE S AME AS TAXABLE INCOME OF THE APPELLANT; THE WORKING OF CAPITAL GAINS IS B ASED ON THE AMOUNT RECEIVED OF RS.76 04 946/- ON ACCOUNT OF SUCH TRANS ACTIONS. 4.3.7 HAVING HEARD THE LD. A.R. AND HAVING GONE THR OUGH THE RELEVANT RECORDS RELATING TO THE TRANSACTIONS OF PURCHASE AND SALE O F SHARES RESULTING INTO INCOME FROM CAPITAL GAINS WHICH HAS BEEN ACCEPTED B Y THE A.O. I AM OF THE VIEW THAT THERE IS NO BASIS FOR REJECTING THE E VIDENCE ADDUCED BY THE APPELLANT IN THE FORM OF CONFIRMATION FROM QUANTUM SECURITIES PVT. LTD. AS ALSO THE PURCHASE AND SALE BILLS OF SHARE TRANSA CTIONS AS FILED BY THE APPELLANT BEFORE THE A.O. THE AMOUNTS IN QUESTION A RE UNDISPUTEDLY RECEIVED FROM QUANTUM SECURITIES PVT. LTD. AGAINST THE TRANSACTIONS OF SHARES AS DULY CONFIRMED BY THEM. THE A.O. HAS NOT POINTED OUT ANY DISCREPANCY IN THE EVIDENCE ADDUCED. THE AMOUNTS IN QUESTION HAVE ALSO BEEN RECEIVED BY WAY OF ACCOUNT PAYEE CHEQUES FROM QUANTUM SECURITIES PVT. LTD. WHO IS MEMBER OF NATIONAL STOCK EXCHANGE IS ASSESSED TO TAX AND ALSO MAINTAINS THE PRESCRIBED BOOKS OF ACCOUNTS . THEREFORE ON THESE FACTS AND CIRCUMSTANCES I FIND NO JUSTIFICATION ON THE PART OF THE A.O. IN MAKING THE IMPUGNED ADDITION WHICH IS HEREBY DELETE D. THE APPELLANT GETS OF RS.76 04 946/-. 4.3.8 COMING TO THE ADDITION OF RS.12 00 280/- I F IND THAT IT CONSISTS OF TWO AMOUNTS OF RS.7 00 030/- VIDE CHEQUE DATED 31 ST OCTOBER 1998 AND RS.5 00 250/- VIDE CHEQUE DATED 12 TH FEBRUARY 1999 AS FOUND CREDITED IN ITA NO.648/DEL./2007 & ITA NO.1203/DEL./2007 (AY : 199-2000) 12 APPELLANTS SAVINGS BANK ACCOUNT. THE A.O. HAS MADE THE IMPUGNED ADDITION ON THE GROUND THAT NO EXPLANATION WAS OFFE RED BY THE APPELLANT EVEN WHEN OPPORTUNITY WAS GIVEN. THE LEARNED A.R. H AS ASSAILED THE REASONING ADOPTED BY THE A.O. AS ALSO THE CONCLUSIO N DRAWN ON THE GROUND THAT THE A.O. HAS FAILED TO APPRECIATE THE EVIDENCE ADDUCED BEFORE HIM AND NECESSARY EXPLANATION OFFERED WITH REFERENCE THERET O. HE HAS INVITED MY ATTENTION TO THE PAPER BOOK CONTAINING A COPY OF AC COUNT STATEMENT OF AMERICAN EXPRESS BANK FILED BEFORE THE A.O. GIVING NARRATION OF EACH AND EVERY ENTRY INCLUDING THIS ENTRY OF RS.7 00 030/- W HICH CLEARLY SHOWS THAT QUANTUM IS MENTIONED AGAINST THIS ENTRY. IT WAS E XPLAINED TO THE A.O. THAT THIS AMOUNT OF RS.7 00 030/- WAS ALSO RECEIVED FROM QUANTUM SECURITIES PVT. LTD. WITH WHOM THE APPELLANT IS HAV ING REGULAR TRANSACTIONS AND NOTHING CONTRARY TO THE EVIDENCE ADDUCED WAS FO UND BY THE ASSESSING OFFICER. AS REGARDS THE ENTRY OF RS.5 00 250/- THE LD. A.R. HAS DRAWN MY ATTENTION TO THE PAPER BOOK CONTAINING COPY OF ACCO UNT WITH AMERICAN EXPRESS BANK ACCOUNT OF THE APPELLANT ON 12 TH FEBRUARY 1999 WHICH WAS RETURNED AS UNPAID AND DEBITED TO THE SAID ACCOUNT ON 13 TH FEBRUARY 1999 AND THEN AGAIN REPRESENTED AND CREDITED TO THE ACCO UNT ON 15 TH FEBRUARY 1999 YET AGAIN RETURNED UNPAID ON 17 TH FEBRUARY 1999. IT HAS THUS BEEN SUBMITTED THAT IN FACT THESE ENTRIES HAVE NO MEANIN G SO FAR AS APPELLANTS INCOME IS CONCERNED WHEN THE CHEQUE WAS NEVER HONOU RED AND THE SAME WAS RETURNED UNPAID. HE HAS ALSO SUBMITTED THAT IT IS A MATTER OF EVIDENCE ON RECORD; STILL THE A.O. HAS CHOSEN TO IGNORE THE SAME. HAVING HEARD THE LEARNED A.R. AND HAVING ALSO GONE THROUGH THE MATER IAL ON RECORD TO MY MIND THE A.O. SEEMS TO HAVE MISREAD THE FACTS AS AV AILABLE ON RECORD IN REACHING AN ERRONEOUS CONCLUSION WHEN APPARENTLY TH E AMOUNT IN QUESTION WAS NEITHER RECEIVED NOR STOOD CREDITED BY APPELLAN T NOR TAKEN ADVANTAGE OF IN ANY FORM. ON THESE FACTS AND CIRCUMSTANCES T HIS ADDITION OF RS.5 00 250/- IS DELETED. THAT THE APPELLANT RECEIV ED THE OTHER AMOUNT OF RS.7 00 030/- FROM QUANTUM ALSO STANDS EVIDENCED FROM BANK STATEMENT OF THE APPELLANT. THEREFORE THE IMPUGNED ADDITION OF RS.7 00 030/- IS FOUND UNJUSTIFIED. THE SAME IS ALS O DELETED. 22. WE HAVE HEARD BOTH THE PARTIES AND GONE THROUGH THE MATERIAL AVAILABLE ON RECORD. FROM THE ORDER OF THE CIT(A) WE FIND THAT CIT(A) H AS EXAMINED THE ISSUE IN DETAIL. DURING THE COURSE OF HEARING THE REVENUE COULD NOT ADVANCE ANY ARGUMENT OR EVIDENCE TO DISLODGE THE FINDINGS OF CIT(A). ACCORDINGLY I N OUR CONSIDERED OPINION THE CIT(A) WAS JUSTIFIED IN DELETING THE ADDITION. 23. THE LAST ISSUE FOR CONSIDERATION RELATES TO DEL ETING THE ADDITION OF RS.16 LAKHS MADE BY THE AO U/S 69 OF THE ACT. THE FACTS STATED IN BRIEF ARE THAT THE ASSESSEE RECEIVED RS.16 LAKHS FROM HIS MOTHER-IN-LAW MRS. SUSHILAWATI BY CHEQUE WHICH WAS DEPOSITED IN HIS SAVINGS BANK ACCOUNT NO.320123012 WITH AMERICAN EXPRESS BANK ON 26.11.1998. ITA NO.648/DEL./2007 & ITA NO.1203/DEL./2007 (AY : 199-2000) 13 COPY OF THE BANK ACCOUNT STATEMENT FOR THE RELEVANT PERIOD OF LATE MRS. SUSHILAWATI WAS FILED WITH THE CONFIRMATION WHICH WAS FILED ON HER BEHALF BY HER DAUGHTER MRS. MADHU ARORA THE WIFE OF THE ASSESSEE. THE COPY OF BANK STATEMENT OF LATE MRS. SUSHILAWATI SHOWED THAT MRS. SUSHILAWATI HAD RECEIVED A SUM OF RS.16 45 688/- ON 7.11.1998 AND HAD ISSUED CHEQUE TO THE ASSESSEE ON 26.11.1998. THE A O RECORDED THE STATEMENT OF SHRI OM PRAKASH ARORA. IT WAS STATED BY HIM THAT MRS. SUSH ILAWATI HAD ADVANCED RS.16 LAKHS TO SOMEBODY TO BUY SOME PROPERTY. HOWEVER THE DEAL F ELL THROUGH AND SHE RECEIVED BACK HER MONEY WITH INTEREST OF RS.45 688/-. THIS INTER EST WAS REFLECTED IN HER INCOME FOR AY 1999-2000. THIS EXPLANATION OF THE ASSESSEE WAS RE JECTED BY AO ON THE GROUND THAT IT WAS A SELF-SERVING STATEMENT. THEREFORE THE AMOUN T OF RS.16 LAKHS WAS TREATED AS INCOME OF THE ASSESSEE U/S 69A OF THE ACT. 24. BEFORE CIT(A) ASSESSEE REITERATED THE SAME ARG UMENTS. THE CIT(A) REMANDED THE MATTER TO THE AO. BEFORE AO THE ASSESSEE FILE D COPY OF AGREEMENT DATED 10.6.1998 WITH SHRI ANURAG SINGH SHOWING THAT AN AMOUNT OF RS .16 LAKH WAS ADVANCED TO HIM BY MRS. SUSHILAWATI FROM HER SAVINGS BANK ACCOUNT WITH CITI BANK FOR PURCHASE OF PROPERTY IN GURGAON. THE COPY OF THIS ACCOUNT WAS ALSO FILE D. THE ASSESSEE HAD ALSO FILED COPY OF AGREEMENT DATED 4.11.1998 WHICH WAS AN AGREEMENT TO TERMINATE THE EARLIER AGREEMENT DATED 10.6.1998 AND IN PURSUANCE OF THE SAME MRS. S USHILAWATI RECEIVED THE AMOUNT OF RS.16 45 688/- WHICH STOOD DEPOSITED IN HER AMERICA N EXPRESS BANK ACCOUNT. THE COPY OF BANK DRAFT AND CHEQUE RECEIVED FROM SHRI ANURAG SINGH HAVE ALSO BEEN FILED. IT WAS ALSO EXPLAINED THAT MRS. SUSHILAWATI WAS HOLDING TW O BANK ACCOUNTS. ONE IN CITI BANK AND OTHER IN AMERICAN EXPRESS BANK BESIDES HOLDING THE DEPOSITS IN CITI BANK. THE AMOUNT OF RS.16 LAKH WAS ADVANCED ON 10.6.1998 TO S HRI ANURAG SINGH BY MRS. SUSHILAWATI FORM HER CITI BANK ACCOUNT. THE PAYMEN T OF RS.16 45 688/- WAS RECEIVED BACK BY MRS. SUSHILAWATI FROM SHRI ANURAG SINGH ON 4.11.1998 AND IT WAS OUT THIS AMOUNT OF RS.16 45 688/- THE AMOUNT OF RS.16 LAKH WAS GIVEN AS LOAN TO THE ASSESSEE. IN THIS MANNER IT WAS PLEADED THAT THE ASSESSEE HAS D ISCHARGED THE ONUS OF PROVING THE IDENTITY AND CREDITWORTHINESS AS ALSO THE GENUINENE SS OF THE TRANSACTIONS. ACCORDINGLY IT WAS PLEADED THAT THE AO WAS NOT JUSTIFIED IN MAKING THE ADDITION. 25. THE CIT(A) ON THE BASIS OF SUBMISSIONS MADE BY THE ASSESSEE DELETED THE ADDITION ON THE GROUND THAT AO HAD FAILED TO APPRECIATE THAT MRS. SUSHILAWATI WAS HAVING ANOTHER ITA NO.648/DEL./2007 & ITA NO.1203/DEL./2007 (AY : 199-2000) 14 BANK ACCOUNT IN AMERICAN EXPRESS BANK WHICH CONTINU OUSLY HAD A BALANCE OF RS.2 LAKH DURING THE PERIOD AND WAS ALSO HOLDING FIXED DEPOSI TS IN CITI BANK. THE FACTS ON RECORD ESTABLISHED THE NATURE SOURCE AND GENUINENESS OF T HE TRANSACTIONS. ACCORDINGLY THE CIT(A) DELETED THE ADDITION. 26. WE HAVE HEARD BOTH THE PARTIES AND GONE THROUGH THE MATERIAL AVAILABLE ON RECORD. FROM THE FACTS STATED ABOVE IT IS CLEAR THAT MRS. SUSHILAWATI WAS HAVING SUFFICIENT AMOUNT IN HER BANK ACCOUNT OUT OF WHICH THE MONEY WAS GIV EN AS ADVANCE TO SHRI ANURAG SINGH FOR PURCHASE OF PROPERTY. WHEN THE DEAL FELL THROU GH THE AMOUNT WAS RECEIVED BY HER WITH INTEREST OUT OF WHICH THE LOAN OF RS.16 LAKHS WAS ADVANCED. DURING THE COURSE OF HEARING LD.CIT(DR) COULD NOT PRODUCE OR BRING ANY MATERIAL ON RECORD TO CONTROVERT THE FINDINGS OF CIT(A). ACCORDINGLY IN OUR CONSIDERED OPINION THE CIT(A) WAS JUSTIFIED IN DELETING THE ADDITION. HENCE NO INTERFERENCE IS C ALLED FOR IN RESPECT OF THIS GROUND. 27. IN THE RESULT THE APPEAL OF THE ASSESSEE IS A LLOWED AND THAT OF THE REVENUE IS DISMISSED. 28. ORDER PRONOUNCED IN OPEN COURT ON 31.03.2010. SD/- SD/- (I.P. BANSAL) (K.D. RANJAN) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: MARCH 10 2009. *SKB* COPY FORWARDED TO:- 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT 4. THE CIT(A)-XVII NEW DELHI. 5. THE DR ITAT LOKNAYAK BHAWAN KHAN MARKET NEW DELHI. AR/ITAT