Income Tax Appellate Tribunal - Chandigarh
Dcit, Patiala vs Sh. Prem Bansal, Panchkula on 13 November, 2017
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IN THE INCOME TAX APPELLATE TRIBUNAL
CHANDIGARH BENCHES 'B', CHANDIGARH
BEFORE SHRI SANJAY GARG, JUDICIAL MEMBER&
Dr. B.R.R. KUMAR, ACCOUNTANT MEMBER
ITA No. 570/Chd/2011
Assessment Year: 2004-05
Sh. Prem Chand Bansal, Vs. The ACIT, Central Circle,
Panchkula Patiala
PAN No. AAQPB6911R
ITA No. 574/Chd/2011
Assessment Year: 2004-05
Smt. Roop Lata Bansal, Vs. The ACIT, Central Circle,
Panchkula Patiala
PAN No. AKGPB0455J
&
ITA No. 631/Chd/2011
Assessment Year: 2006-07
The DCIT, Central Circle, Vs. Sh. Prem Bansal
Panchkula Patiala
PAN No. AAQPB6911R
(Appellant) (Respondent)
Appellant By : Shri N.K. Garg
Respondent By : Sh. Ravi Sarangal
Date of hearing : 22.08.2017
Date of Pronouncement : 13.11.2017
ORDER
Per Sanjay Garg, Judicial Member:
The above captioned appeals in the cases of related assessees (husband and wife) have arisen out of the separate orders of the CIT(A)-1, 2 Ludhiana, dated 28.3.2011, 30.3.2011 and 24.3.2011 for different assessment years in relation to the assessments carried out u/s 153A of the Income-tax Act, 1961 (in short 'the Act').Since facts and issue involved in these appeals are identical, hence, the same have been heard together and are being disposed of by this common order. First, we will take the assessee appeal in the case of Sh. Prem Chand Bansal in ITA No. 570/Chd/2011.
ITA No. 570/Chd/2011.
2. The brief facts relating to the issue are that a search action u/s 132 of the Act was carried out at the premises of the assessee on 16.10.2007 pursuant to which assessment proceedings u/s 153A of the Act were carried out and completed vide assessment order dated 13.12.2009 wherein certain additions were made, which were further confirmed by the Ld. CIT(A). Agitating the same, the assessee has preferred the present appeal taking the following grounds:-
"1. That the impugned appellate order is bad both on facts and law to the extent the additions are confirmed.
2. That the learned Appellate Authority wrongly and illegall y held that the proceedings has been properly initiated u/s 153A and further erred in holding that assessment U/s 153A has been properly made.
3. That the learned Appellate Authority wrongly and illegall y confirmed addition of Rs. 180345/- as long term capital gain although on alternative plea same is deleted.
4. That the learned Appellate Authority wrongly and illegally confirmed the addition of Rs. 24.90 lacs although on alternative plea the addition of Rs. 14.50 Lacs is confirmed.3
5. That the learned Appellate Authority wrongly and illegally confirmed estimate of Business income at Rs.3,25,000/- against the declared income of Rs. 2,1 5,000/- and thus erred in confirming the net addition of Rs. l,10,000/- against the facts and circumstances of the case.
6. That the learned Appellate Authority wrongly and illegally confirmed the addition of Rs. l,50,000/- on account of credit against the facts and circumstances of the case.
7. That the learned Appellate Authority wrongly and illegally confirmed the addition of Rs.5 Lacs on account of alleged payment against the facts and circumstances of the case.
8. That the learned Appellate Authority wrongly and illegally rejected the ground that the additions made in assessment proceedings u/s153A are sine-qua-non the seized material and no addition could be sustained otherwise.
9. That without prejudice and alternatively the additions should be adjusted and telescoped.
10. That the earned Appellate Authority wrongl y and illegally directed to charge interest U/S234 although on facts and circumstances of the case, interest is not chargeable.
3. Ground No.1 is general in nature and does not need separate adjudication.
4. Ground No.2: The Ld. AR of the assessee has stated at bar that ground No.2 is not pressed. In view of this, ground No.2 is dismissed as not pressed.
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5. Ground No. 3: The assessee in this ground has agitated the addition of Rs. 1,80,345/- on undisclosed Long Term Capital Gain.
The brief facts relevant to the issue are that the House No. 346, Sector 15, Panchkula was sold for Rs.19,20,000/- vide registered sale deed. The assessee had 1/2 share in the said property. The assessee further purchased 1/2 share in the property H. No. 9, Sector 9, Panchkula and invested sale proceeds of Rs.9,60,000/- in the property and therefore claimed exemption u/s 54F. During the course of search action, statement of Smt. Roop Lata Bansal (wife of the assessee) was recorded and on the basis of that statement, the Ld. Assessing officer assumed the sale price of the property at Rs.40,00,000/- as against the sale price of Rs.19,20,000/- mentioned in the registered sale deed and calculated the capital gains of Rs. 1,80,345/-. During the course of assessment proceedings, it was explained that the said statement of Smt. Roop Lata Bansal cannot be relied upon because it was not a voluntary and free statement. That Smt. Roop Lata was a Chronic Diabetic and Hyper Tension Patient and she was stunned due to search operation and was not aware of complete facts of her tax matters, financial transactions and property matters which were looked after by her husband (the assessee) only. That it is a very general and common social phenomenon in Indian society that generally husband controls the financial and tax affairs of the wife. Hence, it was submitted that the alleged statement of Smt. Roop Lata should not be made base to reject the registered sale deed. It was further submitted that no addition could be made in the hands of the assessee Shri Prem Bansal on the basis of a statement of Smt. Roop Lata, particularly when her statement was not 5 confronted to Sh. Prem Bansal at the time of search or during investigation.
6. The Ld. Assessing officer however, rejected the above contention of the assessee and observed that the statement of Smt. Roop Lata Bansal was recorded without any pressure or coercion. He relying upon her statement treated the sale price of the house at Rs.40 lacs and computed the Long Term Capital Gain towards 1/2 share of the assessee at Rs. 17,34,345/- after giving the assessee benefit of deduction u/s 54 of the Act. He added the sum of Rs.1,80,345/- into the income of the assessee on account of undisclosed Long Term Capital Gain.
7. The assessee has contested the issue in appeal before the CIT(A) but remained unsuccessful.
8. Before us, the Ld. AR of the assessee has reiterated the submissions as were made before the lower authorities. He has further submitted that during the course of such search of business premises as well as residential premises of the assessee, no document or any other material was found or seized which could corroborate the alleged statement of Smt. Roop Lata. Moreover, she had only 1/2 share of the property. It has been submitted that when nook and corner of the business and residential premises of the assessee and his group was thoroughly searched, and nothing indiscriminating was found indicating any extra receipt of sale proceed of the sale transaction of house Ho. 346, Sec.15, the oral statement of Smt. Roop Lata Bansal, recorded in a confused state of mind, cannot be accepted as legally admissible evidence. It has been further submitted that under section 153A, addition can not be made dehors the material found 6 during search operation or any subsequent investigation. The Ld. A.O. has not made any inquiry with regard to the transaction of sale of the house or about the on money received. It has been further submitted that although Sh. Prem Chand has been the 1/2 share holder of the property and executor of the sale deed before the Sub Registrar, neither any inquiry had been conducted on him on this issue nor his statement was recorded by the Ld. A.O. That, although the statement of Sh. Prem Chand was recorded u/s 132(4) on 16.10.2007, and 28.11.2007, even then no question was put Sh. Prem Chand by the then authorised officer with regard to the sale price of that property, nor the statement of Smt. Roop Lata Bansal was confronted to Sh. Prem Chand Bansal, co-owner of the property. The ld. Counsel for the assessee, in this respect, has also relied upon the following case laws:-
1. CIT Vs. P.V. Kalyansundaram (2007) 294 ITR 0049
2. Paramjit Singh v ITO (2010) 323 ITR 588 (P&H); 37 DTR 228-
3. CIT v Naveen Gera328 ITR 516 (Delhi)
4. Nareash Kumar VermaVs. Assistant CIT (2102) 34 CCH 488 (Chandigarh)
5. Naresh Kumar Aggarwal (2015) 53 taxmann.com 306 (A.P.)
6. Shree Chand SoniVs. DCIT (2006) 101 TTJ 1028 (Jodhpur)
7. CIT Vs. Harjeev Agrawal in ITA NO. 8/2004 order dated 10.3.2016(Delhi-HC)
8. CIT Vs. Sunil Agarwal (2015) 64 taxman.com 107 (Delhi-HC)
9. Basant Bansal v ACIT (2015) 63 taxmann.com 199 (Jaipur Trib.)
10. Dy CIT Vs. Pramukh Builders (2008) 112 ITD 179 (Ahd)
11. CIT Vs. Continental Warehousing Corporation (2015) 374 ITR 645 (Bom.): (2015) 279 CTR 0389 (Bombay) 7
12. All Cargo Global Logistics Ltd Vs. DCIT (2012) 23 Taxman 103 (SB)
9. The Ld. DR, on the other hand, has relied on the findings of the lower authorities.
10. We have heard the rival contentions and have also gone through the records. Admittedly, in this case no incriminating material has been found during the search action in relation to the aforesaid transaction. The addition has been made, solely, on the basis of statement of Smt. Roop Lata Bansal recorded during the search action. It has, however, been explained on behalf of the assessee that the statement of Smt. Roop Lata Bansal was not voluntary and free statement. She was not aware of the financial transactions carried out by the assessee. It has been further submitted that Smt. Roop Lata Bansal was a chronic diabetic and hypertensive patient and that she was stunned due to search operation. The financial transactions and tax affairs of the family have been looked after by the assessee i.e. Shri Prem Chand Bansal. The Ld. Counsel has also relied on the copy of the 'General Power of Attorney' executed b y Smt. Roop Lata Bansal in favour of her husband Shri Prem Bansal vide which she has authorised her husband to look after the affairs of her property including contesting and settling of disputes in the Courts of law and further authorizing him to receive compensation in respect of properties and right to mortgage, lease, sale etc. In our view, this document on the file corroborates the submissions of the assessee that the property affairs and the financial affairs of her wife Smt. Roop Lata Bansal were looked after and managed by Shri Prem Bansal. No document or other evidence was found during the search action giving any presumptions 8 that any money more than that has been mentioned in the sale deed has exchanged between the purchaser and seller of the house in question. Even the Assessing officer did not make any enquiry in respect of the aforesaid transaction from the purchaser of the house in question. Even no question was put to the assessee regarding the aforesaid sale transaction of the house. There was no corroborative evidence found during the search action or during the assessment proceedings except the stand alone statement of Smt. Roop Lata Bansal. A perusal of the copy of the sale deed, which has been placed at page Nos. 61 to 71 of the paper book, reveals that Smt. Roop Lata Bansal is not the signatory and executant of the sale deed in question vide which the H.No. 345, Sector 15, Panchkula was sold for a consideration of Rs.19,20,000/- to the vendee Ms. Rekha Gupta and Shri Anil Kumar Gupta resident of Chandigarh. Shri Prem Chand Bansal has sold the said house as Power of Attorney of one Shri Ramesh Chand S/o Sh. Shambhu Dayal resident of H.No.345, Sector 15, Panchkula. No discussion has been made by the AO regarding the ownership rights of the assessee in the said house. It was claimed in the return of income as well as during the search action and further during the assessment proceedings by the assessee Shri Prem Chand Bansal that he and his wife had 1 /2 share each in the said house. Since no dispute or objection has been raised by the Revenue authorities in this respect, we without going into that issue restrain ourselves to the adjudication of the issue as to the quantum of the sale consideration received. Admittedly, the house in question has been transferred through registered sale deed. No incriminating evidence was available to the lower authorities suggesting that the actual sale consideration was more than that was mentioned in the sale deed. The 9 addition has been made and confirmed by the lower authorities on the stand alone statement of Smt. Roop Lata Bansal, the wife of the assessee. The assessee has taken a plea that he was looking after the financial affairs as well as property matters and taxation matters of his wife also. That she was not aware of the actual facts regarding the sale deed. From the perusal of the sale deed it reveals that Smt. Roop Lata Bansal is not a party to the said sale deed. Neither her name has been mentioned nor her signatures appended, either as a vendor or as witness, on the sale deed. The contents of the said deed in such circumstances remain uncontroverted. Even, Smt. Roop Lata Bansal has executed a 'General Power of Attorney' in favour of her husband (assessee) in respect of her properties which corroborated the submissions of the assessee that the financial and property affairs of Smt. Roop Lata Bansal were managed by him. Under the circumstances and in the light of evidences available on the file, in our view, the reliance of the lower authorities on the stand alone statement of Smt. Roop Lata Bansal in this regard for making the impugned additions cannot be held to be justified. Apart from the appreciation of factual aspects of the case as above, our view, also finds support from the various judicial decisions. The Hon'ble Jurisdictional Punjab & Haryana High Court in the case of 'Paramjit Singh vs ITO' (2010) 323 ITR 588 (P&H) (supra), in the presence of the duly executed regd. sale deed of the property, rejected the contention of the assessee that in fact no sale consideration was received and that the vendor were the real uncles of the assessee who had relinquished their rights in the property in the favour of the assessee. The Hon'ble High Court observed that the sale consideration discussed in the registered sale deed has to be accepted to have been received by the 10 vendors and that reliance cannot be placed on the oral evidence in this respect. Similarly, the Hon'ble Delhi High Court in the case of 'CIT Vs. Naveen Gera'(supra) has held that it is settled law that in the absence of any incriminating material suggesting that anything has been paid over and above than the settled amount in the sale deed, the primary burden of proof is on the Revenue to show that there has been any understatement or concealment of income. The Hon'ble Andhra Pradesh High Court in the case of 'CIT Vs. Shri Ram Das Motor Transport' (supra) has observed that when no incriminating evidence is found in the possession of managing director or other directors of the assessee or any other person during the search action carried out u/s 132 of the Act, the question of examining them by the authorised officer during the course of search and recording any statement from them by invoking the powers under section 132(4) of the Act, does not arise and therefore, such a statement does not have an y evidentiary value. The relevant part of the observations made by the Hon'ble A.P. High Court is reproduced as under:
"A plain reading of sub-section (4) of s. 132 shows that the authorised officer during the course of raid is empowered to examine any person if he is found to be in possession or control of any undisclosed books of account, documents, money or other valuable articles or things, elicit information from such person with regard to such account books or money which are in his possession and can record a statement to that effect. Under this provision, such statements can be used in evidence in any subsequent proceeding initiated against such person under the Act. Thus, question of examining any person by the authorised officer arises only when he found such person to be in possession of any undisclosed money or books of account. But, in this case, it is admitted by the Revenue that on the dates of search, the Department was not able to find any unaccounted money, unaccounted bullion nor any other valuable articles or things, nor any unaccounted 11 documents nor any such incriminating material either from the premises of the company or from the residential houses of the managing director and other directors. In such a case, when the managing director or any other persons were found to be not in possession of any incriminating material, the question of examining them by the authorised officer during the course of search and recording any statement from them by invoking the powers under section 132(4) of the Act, does not arise. Therefore, the statement of the managing director of the assessee, recorded patently under section 132(4) of the Act, does not have any evidentiary value. This provision embedded in sub-section (4) is obviously based on the well-established rule of evidence that mere confessional statement without there being any documentary proof shall not be used in evidence against the person who made such statement. The finding of the Tribunal was based on the above well settled principle. We do not see any question of law in this issue.
The Tribunal recorded a finding of fact to the effect that the statement of the managing director or that of other partners have no evidentiary value as they are not supported by any documentary proof. In the light of the finding that the statements have got no evidentiary value, adjudication of the question whether such statement falls under the Explanation to sub-section (4) of section 132 and, if so, whether or not such Explanation has got any retrospective effect, absolutely serves no useful purpose and that such an attempt, in our view, would be a futile exercise. Because, even if it is to be held on reference that the statement falls under the Explanation and the Explanation has got retrospective effect, such statement does not improve the case of the Revenue in the light of the finding of fact recorded by the Appellate Tribunal.
Therefore, we are of the view that the question became purely academic and it does not deserve reference. "
11. Similar view has been adopted by the Hon'ble A.P. High court in the case of 'Naresh Kumar Agarwal' (supra). Further, The Third Member Bench in the case of DCIT Vs. Pramukh Builders (supra) has held that there being no spectra of evidence regarding undisclosed income, the addition made only on the basis of statement of managing partner of the 12 assessee firm u/s 132(4) of the Act could not be sustained. It has been further observed that there may not be any evidence of coercion being exercised by the search party, there may not be any duress also, but the existence of confusion cannot be ruled out. The Ahmadabad Bench of the Tribunal in the case of 'ACIT Vs. Jorawar Singh M.Rathod' ITA No. 76/Ahd/1997, dated 15.4.2005 has held that there must be something more than suspicion to support the assessment or addition and that the addition cannot be sustained on the basis of retracted statement u/s 132(4) of the Act.. Similar view has been adopted by the Jaipur Bench of the Tribunal in the case of 'Shree Chand SoniVs. DCIT.' (supra); the Hon'ble Delhi High Court in the case of 'CIT Vs. Harjeev Agrawal' in ITA No. 8/2004 (supra) and by the Jaipur Bench of the Tribunal in the case of 'Basant Bansal v ACIT' (supra). In view of the facts and circumstances of the case and in the light of the proposition of the law as laid down by the various Benches of the Tribunal as well as High Courts, in our view, the addition on the stand alone statement of Smt. Roop Lata Bansal in this case is not sustainable in the eyes of law and this issue is accordingly decided in favour of the assessee.
12. Ground No.4. -In this ground the assessee has agitated the addition of Rs.24.90 lacs in respect of purchase of House No.9, Sector 9, Panchkula. The facts relevant to the issue are that the assessee along with his wife purchased H.No. 9, Sector 9, Panchkula for a total sum of Rs.35,20,000/- vide purchase deed dated 1.3.2004. The Ld. Assessing officer on the basis of the statement of Smt. Roop Lata Bansal recorded u/s 132(4) in the course of search action on 16.10.2007 took the purchase price of the property at Rs.85,00,000/- and therefore, the difference of 13 Rs.49,80,000/- was treated as investment from undisclosed sources and 1/2 share i.e. Rs.24,90,000/- was added as income from undisclosed sources in the hands of the assessee.
13. In appeal the Ld. CIT(A) gave part relief to the assessee to the extent of amount already considered as income of the assessee on account of undisclosed higher sale price of the house no. House No. 346, Sector 15, Panchkula.
14. In view of our discussion made above while deciding ground No.3, in our view, no additions are warranted on the stand alone statement of Smt. Roop Lata Bansal without any incriminating material found during the search action on this issue also. This issue is accordingly decided in favour of the assessee.
15. Ground No.5: The assessee in this ground has agitated the addition of Rs.1,10,000/- into the business income of the assessee.
The brief facts relating to the issue are that assessee is engaged in the business of property dealing on commission basis and has declared income of Rs.2,15,000/- under this head. The Assessing officer, however, found that the income was not reasonable and justified. He, therefore, estimated the same at Rs.3,25,000/-. The assessee contested the said addition stating that there was no basis for the Assessing officer to estimate the commission income of the assessee at Rs.3,25,000/- as against the declared income of Rs.2,1,5000/-. The Ld. AR of the assessee in this respect has placed reliance on the decision of the Coordinate Bench of the Tribunal in the case of 'Subhash Chand Vs. ACIT', ITA No. 571, 572 & 573/Chd/2011, order dated 28.11.2011. The Ld. AR submitted that the case 14 of Shri Subhash Chand was also covered under the search and seizure operation that was carried out in the case of Sh. Prem Bansal group of cases. That under similar circumstances, the addition was made in the case of concerned person Sh. Subhash Chand. However, the Coordinate Bench of the Tribunal observed that there was no basis for the lower authorities to make the addition on estimate basis and accordingly the additions were ordered to be deleted. We also find that in the impugned order the Ld. CIT(A) has not given any convincing findings about the basis of confirmation of addition. In view of this, the addition based on mere estimation is not sustainable in the eyes of law and the same is accordingly ordered to be deleted.
16. Ground No.6: The assessee vide this ground has contested the addition of Rs.1,50,000/- on account of unexplained credit. During the assessment proceedings, the Assessing officer required the assessee to file the details of fresh loans accepted during the year. He also required the assessee to prove the identity and creditworthiness of the creditors and genuineness of the transactions. The assessee explained that no such fresh loan was taken by the assessee during the year. However, a list of unsecured loans outstanding as on 31.3.2004 was submitted. The Assessing officer was not satisfied about the loan of Rs. 1,50,000/- received by the assessee from one Shri Kuldip Singh resident of village Kotian.. He accordingly made the impugned addition holding the same was non genuine. In appeal, the Ld. CIT(A) confirmed the aforesaid addition.
17. Ld. AR of the assessee has brought our attention to para 9 of the impugned order of Ld. CIT(A) wherein it has been categorically noted b y the Ld. CIT(A) that the assessee vide letter dated 2.11.2009 had explained 15 to the Assessing officer that the said amount pertains to the advance received from Shri Kuldip Singh against the sale of property which matured in assessment year 2005-06. The copy of the sale deed was also placed on record. The Ld. CIT(A), however, brushed aside the aforesaid argument observing that the identity and creditworthiness of Shri Kuldip Singh and genuineness of the transaction has not been proved. In our view, when a copy of the registered sale deed has already been produced on the file and it has been explained that the advance of Rs. 1.50 lacs was received in relation to the aforesaid transaction, there was no question for the lower authorities to disbelieve the above plea especially in the absence of any incriminating material found during the search action. Reliance in this respect can be placed on the decision of the Hon'ble Delhi High Court in the case of 'CIT Vs. Kabul Chawla' 234 Taxman 300 ( Delhi) and of the by the Hon'ble Bombay High Court in the cases of 'All Cargo Logistics' ITA No.1969 of 2013 and 'Continental Warehousing Corporation' ITA No. 523 of 2013 (common order) reported in (2015) 279 CTR 0389 (Bombay) This issue is accordingly decided in favour of the assessee and the impugned additions made on this issue are hereby ordered to be deleted.
18. Ground No.7: The assessee vide ground No.7 the assessee has agitated the addition of Rs. 5 lacs on account of unexplained payments to one Shri Gurcharn Singh resident of village Barlain which was revealed from the seized documents. The assessee explained that the payment made to Shri Gurcharan Singh on account of property transaction was effected on his behalf on commission basis. That the amount was received from the other party on behalf of the said Shri Gurcharan Singh and the same was paid to Shri Gurcharan Singh. That the commission income earned from the 16 said transaction has already been offered by the assessee as his business income. The Assessing officer however, rejected the above contention of the assessee and added the same amount as income of the assessee as undisclosed income.
19. We have considered the rival submissions. Admittedly, the assessee is in the business activity of sale and purchase of property on commission basis. The assessee has also returned the commission income in his return of income. The assessee has explained that the said amount was received on behalf of Shri Gurcharan Singh in relation to the property transaction and the income earned was duly returned in his return of income for assessment year 2004-05. A perusal of the computation of total income attached with the acknowledgement for return of income for assessment year 2004-05 reveals that the assessee has returned an income from purchase and sale of properties of Rs. 2,15,000/-. The assessee has also given the name and address of the persons to the Assessing officer on behalf of whom the transactions were carried out. The Assessing officer without making any further enquiry simply added the amount into the income of the assessee treating it as undisclosed payment. The Assessing officer could not establish any other business transaction, loan or purchase of property transaction of the assessee with Shri Gurcharan Singh or that the commission income offered by the assessee was for some other activity. We further find that the additions on the identical issue were made by the AO in the case of the assessee for AY 2008-09 also, however the same were deleted by the CIT(A). In the circumstances, the addition made by the Assessing officer merely on the basis of suspicion without further inquiry into the explanation given by the assessee is not sustainable 17 in the eyes of law and the same is accordingly ordered to be deleted. The issue is accordingly decided in favour of the assessee.
20. Ground No. 8 : This ground is general legal ground wherein the assessee has taken the plea that the additions cannot be made in the absence of any incriminating material. This issue has already been dealt with by us in ground No.6 of the appeal and decided in favour of the assessee in the light of the decision of the Hon'ble Delhi High Court in the case of CIT Vs. Kabul Chawla' and Hon'ble Bombay High Court in the case of 'All Cargo Global Logistics Ltd Vs. DCIT' (supra).
21. Ground No.9: In this ground the assessee has taken the alternative plea that the additions should be adjusted and telescoped. Since we have already deleted the impugned additions, this ground has become infructuous and needs no adjudication.
22. Ground No.10: This ground regarding levy of interest u/s 234B is consequential in nature and does not require any adjudication at this stage.
23. Ground No.11: This ground is general in nature and does not require any adjudication.
In view of our findings given above, this appeal of the assessee is hereby allowed.
ITA No. 574/Chd/2011 (assessment year 2004-05) :-
24. This appeal has been preferred by the assessee Smt. Roop Lata Bansal wife of Shri Prem Chand Bansal. The assessee in this appeal has taken following grounds of appeal:-
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1. That the impugned appellate order is bad both on facts and law to the extent that the additions are confirmed.
2. That the learned Appellate Authority wrongly and illegally held that the proceedings has been properly initiated u/s .153A and further erred in holding that assessment u/s 153A has been properly made.
3. That the learned Appellate Authority wrongly and illegally confirmed addition of Rs. 180345/- as long term capital gain although an alternative plea same is deleted.
4. That the learned Appellate Authority wrongly and illegally confirmed the addition of Rs. 24.90 lacs although on alternative plea the addition of Rs. 14.50 Lacs is confirmed.
5. That the learned Appellate Authority wrongly and illegally confirmed addition of Rs.6,97,000/- on account of unexplained entries in the Bank account against the facts and circumstances of the case.
6. That the learned Appellate Authority wrongly and illegally rejected the ground that the additions made in assessment proceedings u/s 153A are sine-qua-non the seized material and no addition could be sustained otherwise.
7. That the learned Appellate Authority wrongly and illegally directed to charge interest u/s 234B although on facts and circumstances of the case, interest is not chargeable.
8. That the appellant craves permission to elucidate, add, amend : modify, delete any ground or grounds of appeal before the disposal in the interest of substantial justice.
25. Ground No.1 : This ground is general in nature and does not require any adjudication. However, the plea taken in this ground will be taken into consideration while adjudicating the specific issues. 19
26. Ground No. 2 : The Ld. counsel for the assessee has stated at Bar that he does not intend to press the ground No. 2 of the appeal, hence, the same is dismissed as not pressed.
27. Ground Nos. 3 & 4 : The issue raised in ground Nos. 3 & 4 is identical and relates to the same transactions as discussed while adjudicating ground Nos. 3 & 4 above in ITA No. 570/Chd/2014, in the case of husband of the assessee namely Shri Prem Chand Bansal. In view of discussion and findings given in the aforesaid appeal, ground Nos. 3 & 4 are allowed and decided in favour of the assessee.
28. Ground No.5 : Vide this ground, the assessee has agitated the confirmation of addition of Rs. 6,97,000/- on account of unexplained entries in the bank account of the assessee.
The brief facts relating to the issue under consideration are that addition of Rs.6,97,000/- was made by the Assessing officer into the income of the assessee as the assessee failed to explain the credit entries to the extent of aforesaid amount deposited in her account.
29. In appeal before the CIT(A), the assessee submitted that these deposits were made by her from the sale proceeds of her properties and also from rental income, whereupon a remand report was called by the CIT(A) from the Assessing officer. In his remand report, the Assessing officer reported that the assessee had not submitted any evidence with regard to her contentions. In rejoinder to the said remand report, the assessee furnished before the CIT(A) statement giving details of sale deed etc. wherefrom the amount had come. The assessee explained that there were three credit entries in the bank account. Credit of Rs.3 lacs and 20 Rs.2,47,000/- was on account of sale of agricultural land in Village Kakrali, copy of the sale deed was also enclosed showing the sale of land for Rs.6,65,000/- and the two cheques of Rs.5,50,000/- and Rs. 1,15,000/- in cash. It was explained that the cheque of Rs. 3 lacs was credited on 7.6.2003 and credit of Rs. 2,47,000/- was against the cheques of Rs.2,50,000/-.
30. The Ld. CIT(A) after considering the above submissions and going through the statement of affairs i.e. balance sheet as on 31.3.2004 and capital account for the period ending 31.3.2004 observed that all the entries were duly incorporated. He, however, upheld the decision observing that the copy of the sale deed was not enclosed.
31. Before us, the Ld. AR of the assessee has produced the copy of the sale deed vide which property situated at village Kakrail has been sold for a sum of Rs. 6,65,000/-, out of which Rs. 5,50,000/- has been received by the assessee through cheques, which fact has not been disputed at all b y the lower authorities. The assessee proved beyond doubt the source of aforesaid credit. In view of this, the addition made by the lower authorities is not sustainable in the eyes of law and the same is accordingly ordered to be deleted.
32. Ground No.6 : The issue raised in this ground is identical to ground No.8 of the appeal in ITA No. 570/Chd/2014 for assessment year 2004-05, which is a general legal ground. In view of our findings given while adjudicating the aforesaid ground No. 8 in ITA No. 570/Chd/2014, this ground is decided in favour of the assessee.
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33. Ground No. 7 : This ground regarding levy of interest u/s 234B of the Act being consequential in nature, does not require any adjudication at this stage.
34. Ground No. 8 : This ground is general is nature and does not require any adjudication.
In view of our discussion made above, this appeal of the assessee stands allowed.
ITA No. 631/Chd/2011 (assessment year 2006-07)
35. This appeal has been preferred by Revenue against the order of CIT(A)-1, Ludhiana, dated 24.3.2011, in relation to the order passed u/s 143(3) r.w.s. 153A of the Act. The Revenue in this appeal has taken the following grounds:-
1. The Ld. CIT(A) has erred both in law and on facts of the case by deleting the addition of Rs. 18,85,000/- made by the Assessing officer on account of disallowance of exemption u/s 54F ignoring the fact that the exemption u/s 54F was disallowable on one flat only whereas the assessee had claimed the same on two flats even when he was not having another residential house.
2. The Ld. CIT(A) has erred both in law and on the facts of the case by deleting the addition of Rs. 54,02,500/- made by the Assessing officer on account of undisclosed cash receipts of the assessee, ignoring the facts that the additions were made on the basis of seized material and other relevant factors.22
36. Ground No.1 : The Revenue in this ground is aggrieved by the action of the CIT(A) in deleting the addition of Rs.18,85,000/- made by the Assessing officer on account of disallowance of exemption u/s 54F of the Act.
37. The brief facts relating to the issue under consideration are that the assessee, during the year under consideration, sold a plot for Rs.37,50,000/- and claimed exemption u/s 54F of the Act on account of purchase of new residential complex. From the perusal of the record, the Assessing officer observed that the assessee had purchased two flats bearing Nos. 604 & 605 in Satyam Swastik Apartments, Patiala Road, Zirakpur. The Assessing officer observed that since the assessee already owned a house at Panchkula, the deduction u/s 54F of the Act was allowable for one more house only. The Assessing officer accordingl y disallowed the deduction on the second flat purchased by the assessee.
38. In appeal, the assessee submitted before the Ld. CIT(A) that assessee had purchased flat Nos. 604 & 605 which were adjacent to each other and were being used by the assessee as a single house and, therefore, deduction u/s 54F should be allowed on the investment in the aforesaid flats. The Ld. CIT(A) after considering the above submission of the assessee and in the light of the various judicial decisions held that the assessee was entitled to deduction u/s 54F as the assessee had purchased and was using the adjacent flats as single residential unit. He further observed that even assessee was having only 1/2 share in the already owned House No. 9, sector 9, Panchkula and, therefore, it could not be said that he was owner of one residential house. He, therefore, relied upon the decision of the Tribunal in the case of Rasik Lal N. 23 Satra reported in 98 ITD 335 held that even otherwise the deduction u/s 54F to the assessee cannot be denied to the assessee.
39. After considering the rival contentions, we find that the issue, as of now, is covered by the various decisions of the Tribunal in favour of the assessee. Reliance can be placed in respect on the recent decision of the Hon'ble Madras High Court in the case of Abhijit Bhandari Vs. Principal CIT (2017) 82 taxman.com 457. In view of the above, we do not find any infirmity in the order of the CIT(A) on this issue and the same is accordingly upheld.
40. Ground No.2 : In this ground, the Revenue has agitated the action of the CIT(A) in deleting the addition of Rs. 54,02,500/- made by the Assessing officer on account of undisclosed cash receipts by the assessee.
The brief facts relating to the issue under consideration are that the Assessing officer from the seized documents gathered that the assessee had received amounts from various persons against the sale of various plots at Swastik Vihar. The assessee explained that the assessee had sold the land as General Power of Attorney (GPA) of the land owners Shri Bhag Singh, Surjan Singh, Kuldeep Singh etc. and the amount collected on behalf of them were handed over to the said land owners. The commission income earned by the assessee on the aforesaid transaction was duly offered by the assessee in his return of income. The Assessing officer rejected the above contention of the assessee and treated the receipt of amount totaling Rs.54,02,500/- as income of the assessee.
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41. he Ld. CIT(A), after considering the submissions and relevant evidence on this issue, observed that the assessee had furnished the sale deed claimed to be executed as GPA of the land owners regarding the plots mentioned in the seized documents. He further observed that similar issue had already been dealt with by him while adjudicating the appeal of the assessee for 2008-09 and in the light of the discussion made therein, he deleted the aforesaid addition for the year under consideration also.
42. The Ld. Counsel for the assessee has invited our attention to the copy of the order dated 24.3.2011 of the CIT(A)-I, Ludhiana . The identical issue in the case of the assessee for assessment year 2008-09 has been discussed in para 12 of the decision. The Ld. CIT(A) therein has observed that it was an admitted fact that the assessee was working as commission agent for land owners. Further, that there was evidence available that the assessee had never himself purchased the land in question i.e. Swastik Vihar. The statement of the said land owners namely Shri Bhag Singh, Surjan Singh, Pritam Singh and Hari Singh was recorded by the Assessing officer. In their statements, they have admitted that Shri Prem Bansal was authorised by them to sell the land on commission basis. That the Assessing officer had already assessed the commission income of land business in the hands of the assessee separately. In the absence of any evidences in support of the contentions raised by the assessee, the additions were made by the Assessing officer on mere suspicion basis. The Ld. CIT(A), therefore, deleted the additions.
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43. The Ld. DR could not brought out any distinguishing fact to rebut the aforesaid factual findings given by the CIT(A). We, therefore, do not find any infirmity in the order of the CIT(A) while deleting the aforesaid addition.
44. The appeal of the Revenue is hereby dismissed.
45. In the result, the appeals of the assessee in ITA Nos. 570 & 574/Chd/2004 stand allowed whereas the appeal of the Revenue bearing ITA No. 631/Cdh/2011 stands dismissed. Order pronounced in the Open Court on 13.11.2017 Sd/- Sd/-
( DR. B.R.R. KUMAR) (SANJAY GARG) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated :13 t h November, 2017 Rkk Copy to: 1. The Appellant 2. The Respondent 3. The CIT 4. The CIT(A) 5. The DR