Income Tax Appellate Tribunal - Ahmedabad
Rameshbhai Keshubhai Lathia, ... vs Income Tax Officer,Ward-2(3),, ... on 30 November, 2016
IN THE INCOME TAX APPELLATE TRIBUNAL "SMC" BENCH, AHMEDABAD BEFORE SHRI SHAMIM YAHYA, ACCOUNTANT MEMBER आयकर अपील सं./ ITA No. 1328/Ahd/2012 िनधा रण वष / Assessment Year : 2008-2009 Shri Rameshbhai Keshubhai The ITO, Lathia, Vs Ward - 2 (3), Bela, Navagam Road, Bhavnagar Gariyadhar, Dist : Bhavnagar PAN : ACXPL 1423 D अपीलाथ / अपीलाथ (Appellant) यथ यथ / थ (Respondent) Assessee by : Shri Tushar P. Hemani, AR Revenue by : Shri N.P. Patel, Sr. DR सुनवाई क तारीख/ Date of Hearing : 30/11/2016 घोषणा क तारीख / Date of Pronouncement: 30/11/2016 आदेश/O R D E R This appeal by the assessee is directed against the order of the Ld. Commissioner of Income-tax (Appeals)-XX, Ahmedabad dated 25.01.2012 and pertains to Assessment Year 2008-09.
2. The grounds of appeal read as under:-
1. The learned Assessing Officer ought to have taken into consideration the facts, legal position and provide reasonable time to the appellant.
2. The learned Assessing Officer has erred in law by adding advance of Rs.12,50,000/- u/s 68 of the Act.
3. The assessee in this case is doing medical practice and is also having agricultural income. The case was selected for scrutiny through CASS on the AIR information. Upon scrutiny, it was revealed that the assessee has deposited cash totaling to Rs.13,00,000/- in the Axis Bank at Amreli during the F.Y. 2007-08. During the year under consideration, the total income of assessee Rs. 1,30,560/- reducing by Chapter VI deduction of Rs. 22573/- and taxable income shown at Rs.107930/-. The assessee has not furnish the AIR information while filling of the return of income and also the Axis bank SMC-ITA No 1328/Ahd/2012 Shri Rameshbhai Keshubhai Lathia vs. ITO AY : 2008-09 2 account in which cash deposited Rs. 13,00,000/- was not declared at the time of return. The assessee filed his revised statement of income after the first hearing before the AO and in this first filing he had not shown any property on transfer of agricultural land from his father. He also stated before the AO that there was no loan received from anybody.
3.1 Later on, the assessee also showed that he had received an advance of Rs.12,50,000/-. The assessee filed revised statement of income and furnished revised balance sheet and written submission on 12.10.2010 before the AO, to the effect that he has sold his agricultural lands to his uncles Shri Devrajbhai Karsanbhai Lathia and Vallabhbhai Karsanbhai Lathia and against the said sale, the details of cash payment received are as under:-
Shri Devrajbhai Cash Paid Shri Vallabhabhai Cash Paid Karsanbhai Latia (Rs) Karsanbhai Latia (Rs) 25.07.2007 1,25,000 25.07.2007 1,25,000 21.08.2007 1,50,000 21.08.2007 1,50,000 20.09.2007 1,00,000 20.09.2007 1,00,000 20.10.2007 1,00,000 20.10.2007 1,00,000 11.11.2007 1,25,000 11.11.2007 1,25,000 11.12.2007 25,000 11.12.2007 25,000 Total 6,25,000 Total Rs.6,25,000 3.2 The AO issued summons to the concerned persons and recorded their statements. After analyzing the statements and submissions, the AO concluded as under:-
"It is noticed that the Shri Devrajbahi & Vallabhabhai land is under Hypothecation of Bela Seva Sahkari Mandi, Bhavnagar Dist. Co.Op. bank. Over all it is prove the that Shir Vallabhbhai and Devrajbahi credit worthiness not genuine. The family members of both shri Devrajbhai and Vallabhbhai is more than six. The crops production is and income from agricultural is round about llacs to 1.251acs. The credit worthiness of the Devrajbhai & Valllabvhbhai not genuine. They have not made registered document for want of small amount it prove that they have not paid Rs.6,25,000/- each and total cash payment of Rs. 12,50,000/- for purchasing SMC-ITA No 1328/Ahd/2012 Shri Rameshbhai Keshubhai Lathia vs. ITO AY : 2008-09 3 agricultural land is not genuine. They are uncle of Shri Rameshbhai K. Lathia and made story to save him. The Agricultural land is transfer on 07- 08-2007 and sale payment started from the 25-07-2007. The assessee also filed his written statement on 08-06-2010 that during the year under consideration there is no purchase or sale of immovable property. However agriculture land of Bela village is transfer in my name by my father as per agricultural book is enclosed. During this time assessee has not declare that his sale transaction of agricultural land. The assessee received sale payment before the transfer of agricultural land. This transaction was not produce at the time of return filling. The claim of advance against sale of Agricultural land is rejected and added to the total income of assessee. The assessee is not proving his genuineness of cash deposit from advance receipt from his uncle. They have not credit worthiness and source of income is not sufficient. In view of the above it is seen that All creditors were shown by cash receipt. The cash creditor had no sufficient source of income and no capacity to advance money to the assessee. The genuineness of the transaction were not proved the entries show in the revise balance sheet were totally fake. In this case creditors are not proving their capacity- creditworthiness to advance the loan also to prove the genuineness of transaction. It is held that undisclosed cash credit of Rs. 12,50,000/- within the meaning of section 68 of the income tax Act, 1961. A penalty notice u/s 271(1)(c) of the Act is separately issued for concealment of income and furnish the incorrect particular of income. (Addition of Rs. 12,50,000/-)."
3.3 Upon assessee's appeal, ld. CIT(A) analyzed the assessee's submissions and concluded as under:-
"4.2 In the assessment order, AO observed that the appellant received Rs.12.5 lakhs from his uncles towards the sale consideration of agricultural land; even though the payment was received 2 years before the sale of agricultural land was yet to be registered; the alleged purchaser of agricultural land had no sufficient source of income to advance the said amount for purchase of agricultural land and therefore addition of Rs.12.5 lakhs was being made u/s 68.
The contentions of the learned AR are that the appellant had provided documents in respect of advance received from the party; the sale deed was not executed as balance payment of Rs.0.6 lakhs was pending; the parties are capable of providing funds and therefore, the addition made is required to be deleted.
Having considered the facts of the case, I am not inclined to accept the contentions of the learned AR. The said sum of money was received in cash and apparently even till date the sale deed is not registered. The appellant SMC-ITA No 1328/Ahd/2012 Shri Rameshbhai Keshubhai Lathia vs. ITO AY : 2008-09 4 has not been able to substantiate the creditworthiness of the so called purchasers of agricultural land. No evidences have been produced during the assessment proceedings to controvert the findings of the AO; therefore no interference is called for. This ground of appeal is dismissed."
3.4 Against the said order of ld. CIT(A), the assessee is in appeal before the ITAT.
4. I have heard both the Counsel and perused the records. I find that the assessee in this case is engaged in medical profession and also shows some agricultural income. As per AIR information, undisclosed cash deposits were found by the AO in his bank account. With regard to the deposit of Rs.12,50,000/-, the assessee claimed that he had received this amount on account of proposed sale of lands to his two uncles on various dates. Even before the Tribunal, no evidence whatsoever has been produced as to whether the said transfer of lands was consummated. Ld. CIT(A) has noted that even after two years of the claim, no evidence of the transfer materializing was shown before him. In these circumstances, the above claim of the assessee is only a self serving story, devoid of cogency. In absence of any evidence as to whether the lands sale was consummated, the theory that the certain persons advanced cash on various dates in anticipation of land purchase deal cannot be accepted. It is devoid of cogency and on the anvil of test of human probability and the same is liable to be disbelieved. Without actual transfer of land, how a person will advance cash on various dates and then keep silent about registration of the deal or return of money? The Hon'ble Apex Court in the case of CIT vs. Durga Prasad More, reported in [1971] 82 ITR 540 and Sumati Dayal, 241 ITR 801 (SC) has held that Revenue Authorities are not supposed to put on blinkers but have to consider the surrounding circumstances and to take into account the test of human probability. On the conspectus of above SMC-ITA No 1328/Ahd/2012 Shri Rameshbhai Keshubhai Lathia vs. ITO AY : 2008-09 5 facts and precedence, it is manifest that there is no infirmity in the orders of the authorities below and accordingly, I sustain the same.
5. In the result, this appeal filed by the assessee stands dismissed.
Order pronounced in the Court on 30th November, 2016 at Ahmedabad.
Sd/-
SHAMIM YAHYA
(ACCOUNTANT MEMBER)
Ahmedabad; Dated 30/11/2016
*Biju T., Sr. PS
आदेश क ितिलिप अ ेिषत/Copy of the Order forwarded to :
1. अपीलाथ / The Appellant
2.
यथ / The Respondent.
3. संबंिधत आयकर आयु / Concerned CIT
4. आयकर आयु (अपील) / The CIT(A)
5. िवभागीय ितिनिध, आयकर अपीलीय अिधकरण, अहमदाबाद / DR, ITAT, Ahmedabad
6. गाड फाईल / Guard file.
/ BY ORDER, देशानुसार TRUE COPY Dy./Asstt.Registrar) उप/सहायक पंजीकार ( आयकर अपीलीय अिधकरण, अहमदाबाद / ITAT, Ahmedabad