Income Tax Appellate Tribunal - Chandigarh
Sh. Povinder Singh Oujla,Ludhiana vs Acit, Intl. Taxation, Circle, ... on 16 May, 2025
आयकर अपील य अ धकरण,च डीगढ़ यायपीठ, च डीगढ़
IN THE INCOME TAX APPELLATE TRIBUNAL
DIVISION BENCH, 'B' CHANDIGARH
BEFORE SHRI RAJPAL YADAV, VICE PRESIDENT AND
SHRI KRINWANT SAHAY, ACCOUNTANT MEMBER
आयकर अपील सं./ ITA No. 1332/CHD/2019
नधारण वष / Assessment Year: 2011-12
Shri Povinder Singh Oujla, The ACIT,
House No. 89 & 90, Vs (International Taxation),
Partap Colony Road,Kartar Nagar, Circle - Chandigarh,
Sargodha Colony, Model Gram,
Ludhiana.
थायी लेखा सं./PAN NO: AWNPA9586C
अपीलाथ /Appellant यथ /Respondent
Assessee by : Shri Pankaj Bhalla, CA and Shri Hunny Bajaj, Advocate
Revenue by : Dr. Ranjit Kaur, Addl.CIT, Sr.DR
Date of Hearing : 15.05.2025
Date of Pronouncement : 16.05.2025
HYBRID HEARING
ORDER
PER RAJ PAL YADAV, VP The assessee is in appeal before the Tribunal against the order of the ld. Commissioner of Income Tax (Appeals) [in short 'the CIT (A)'] dated 20.08.2019 passed for assessment year 2011-12.
ITA No.1332/CHD/2019
A.Y.2011-12 2
2. Or iginally assessee has raised four grounds of appeal, out of those grounds, Ground No. 1 and 4 are gene ral grounds, which do not call for recording of any specif ic finding. In rest of the two grounds, the grievance of the assessee is that ld. CIT(A) has erred in upholding the re-opening of assessment by issuance of a notice u/s 148 of the Income Tax Act and confirming the addition of Rs.50,00,500/- added by the AO on account of unexplained cash deposits in the bank.
3. The assessee has filed an application under Rule 11 of the ITAT Rules, 1963 for perm ission to raise additional ground of appeal. In this additional ground of appeal, assessee has pleaded that re-opening has been made without proper approval from the competent author ity as contemplated in Section 151 of the Income Tax Act.
4. Since it is a connected plea for Ground No. 2 whereby assessee has challenged the re-opening of assessm ent, we admit this ground and proceed to decide this issue whether assessment has been reopened validly or not.
5. The brief facts of the case are that assessee did not file his return of income. The AO received information from ITA No.1332/CHD/2019 A.Y.2011-12 3 Annual Report Wing that assessee has made deposit in cash of Rs.50,00,500/- in the Punjab National Bank, Saving Bank Account No. 3517000604108179. The AO has recorded the reasons and reopened the assessment. Since assessee did not respond to the AO, hence he passed the ex-parte assessment according to his best judgement u/s 144 read with Section 147 on 01.11.2018. The ld. counsel for the assessee drew our attention towards page No. 70 to 81 and submitted that approval of ld. JCIT for re-opening of the assessment is available on page 79 but he has approved the reasons which are different with the one reproduced in the assessment order. The copy of the reasons approved by the JCIT is available on page No. 80 and 81. Thus, according to the ld. counsel for the assessee, t he AO has not taken any approval qua the reasons repro duced on page No. 2 of the assessment order. The AO has not analyzed the information received from the AIR/CI B and has not applied his independent m ind.
6. On the other hand, ld. DR r elie d upon the orders of Revenue authorities.
7. We have duly considered the rival contentions and gone through the record carefully. The reasons were recorded on ITA No.1332/CHD/2019 A.Y.2011-12 4 20.03.2018 and they were approved by the Competent Authority on 23.03.2018 and notice u/s 148 was issued on 27.03.2018. No doubt, the reasons referred in the assessment order are at little bit variance from the reasons approved by the JCIT, but it is pertinent to note that the reasons which are approved, they are valid reasons to harbour a belief that income of the assessee has escaped assessment. The AO might hav e reproduced incomplete reasons in the assessment order but that does not mean there were no valid reasons available on the record. The valid reasons are those reasons which are approved by the Competent Authorit y u/s 151 of the Income Tax Act. No weightage could be given to the alleged reference of reasons in the assessment order. As far as argum ent of the ld. co unsel for the assessee that no independent mind was applied by the AO, we find that it is not ascertainable on the record whether as sessee was having any Permanent Account Number at the relevant time, but it is sure he has not filed the return for this assessment year. In s uch situation, it was not practically possible for the AO to make analysis of the information c ollected from AIR with the ITA No.1332/CHD/2019 A.Y.2011-12 5 assessment record of the assessee. He has to believe in the information and he has r ightly harboured his belief that income of the assessee has escaped assessment. The AO cannot ascertain the source of deposits in the bank account from the assessment record of the assessee in the absenc e of link for verifying that fact. Therefore, we do not find m erit in the contentions raised by the ld. counsel for the as sessee qua re-opening of assessm ent vis-à-vis grant of approval by the competent authority. There is no merit in it. Hence, first fold of grievance is rejected. Re-opening is valid and it is upheld.
8. With regard to the source of cash deposits, ass essee has given following explanation :
SOURCE OF CASH DEPOSITS AMOUNT (INR) Sale Proceeds from the Sale of Agricultural Land measuring 1.697 30,00,000 Hectares to Mrs. Kulwinder Kaur and Mrs. Gurvinder Kaur on 30.03.2011 received in Cash Gift received by the Wife of the Appellant from her Father amounting to 11,00,000 Rs. 11,00,000/ -
Outstanding Two Years' Lease Rent and Advance Lease Rent for two 6,40,000 years, received in Cash by the Mother of the Appellant from leasing out 4 Acres of Agricultural Land located at Village Mathada Khurd Tehsil Phillaur District Jalandhar (Lease Rent @ Rs. 40,000/- per Acre per annum) 5,000/- Great Britain Pounds each were brought by the Appellant, his 10,50,000 Wife and his Mother from United Kingdom to India on their travel and approximately were converted in Indian Rupees Lease Rent received in Cash by the Appellant and his Father-in-law from leasing out Agricultural Land ITA No.1332/CHD/2019 A.Y.2011-12 6
9. The ld. counsel for the assessee dr ew our attention towards page 56 of the Paper Book wher ein copy of the Sale Deed is available. In this Sale Deed, name of the assessee is also available. Ld. First Appellate Aut hority has erred in observing that it was sold by the brother of the assessee. We find that Sale Deed is by both the brother s. Both brothers have filed their affidavit before the CIT(A) that sale proceeds have been deposited in the bank account. Hence, to the extent of Rs.30 lacs, no doubt should have been raised by the Revenue Authorities. The assessee has explained the source. As far as the balance amount is concer ned, the CIT(A) has erred in making observation that assessee has not submitted the bank statement of his father -in-law, from whom a gift was received by his wife. It is pertinent to note that it is a joint account between assessee and his wife. His father-in-law withdrew a sum of Rs.11 lacs and copy of the bank statement is available on page 73. He has confi rmed the gift to his daughter of Rs.11 lacs and t he confirmation is available on page 45 of the Paper Book. Therefore, asse ssee has explained the source of Rs.11 lacs als o. Similarly, assessee has demons trated that he h as 4 ac res of l and which was given on leas e by his mother and ITA No.1332/CHD/2019 A.Y.2011-12 7 lease money of 3-4 years was given to him on his visit from U.K. to India which was deposited in the bank account. Rest of Rs.10.50 lacs is the small savings out of Britain Pounds, which has been deposited by his wife in the bank account. Thus, according to us, assessee has fully explained t he source of Rs.50,00,500/- deposit ed in the Saving Bank during this year. The relevant evidence has been filed on Paper Book. The ld. Fir st Appellate Authority have erred in not believing the version put forth by the assessee. Accordingly, we allow second fold of grievance and delete the addition.
10. Appeal of the assessee is partly allowed.
O r d e r p ro n o un ced o n 16 . 0 5. 2 02 5 .
Sd/- Sd/-
(KRINWANT SAHAY) (RAJPAL YADAV)
ACCOUNTANT MEMBER VICE PRESIDENT
"Poonam"
आदेश क ितिलिप अ ेिषत/ Copy of the order forwarded to :
1. अपीलाथ / The Appellant
2. यथ / The Respondent
3. आयकर आयु / CIT
4. िवभागीय ितिनिध, आयकर अपीलीय आिधकरण, च डीगढ़/ DR, ITAT, CHANDIGARH
5. गाड फाईल/ Guard File आदेशानुसार/ By order, सहायक पंजीकार/ Assistant Registrar