Income Tax Appellate Tribunal - Amritsar
Mohinder Paul vs Asstt. Cit on 18 January, 2002
Equivalent citations: (2004)90TTJ(ASR)764
ORDER
BY THE BENCH :
These two appeals by the different assessees are directed against the consolidated order of the Commissioner (Appeals), Jalandhar, dated 1-9-1997, relating to the assessment year 1980-81. The common grounds of appeal are as under
"1. The Commissioner (Appeals) has grossly erred in upholding the reopening proceedings under section 147(b) of the Income Tax Act though the proceedings for reopening were initiated under section 147(a) of the Income Tax Act by the assessing officer to which the assessee has objected to.
2. The Commissioner (Appeals) has grossly erred in not commenting upon the report of handwriting expert though admitting the same, thereby ignoring the contention of the assessee that the full and true disclosure was made at time of filing the return.
3. The proceedings initiated under section 147(b) are wrong and bad in law as there was no information in the possession of the assessing officer which could be made the basis of reopening the case,
4. The Commissioner (Appeals) has erred in confirming the addition on the basis of the merits also.
5. The appellant craves leave to add, amend, alter or delete any of the grounds of appeal before or at the time of hearing."
2. We will first take up ground No. 4, which related to the confirmation of addition of Rs. 35,000 in each case in the purchase of residential plot. The assessment year involved is 1980-81. Both the assessees purchased a residential plot for Rs. 70,000 each having 1/2 share therein and invested Rs. 35,000 each. The assessment was completed under section 143(l) of the Income Tax Act, 1961. Subsequently, when the case was scrutinised while making the assessment for the assessment year 1981-82, in which the assessees had declared short-term capital gains on the sale of the same plot, the assessing officer enquired about the source of the investment in the acquisition of the plot and then found that the assessees had no satisfactory explanation about the source of investment. Thereafter, the assessing officer initiated proceedings Under section 147(a) read with section 148 of the Income Tax Act, 1961. The assessing officer noticed that for the assessment year 1981-82, in the returns of income each of the assessees had declared a short-term capital gain of Rs. 4, 000 on the sale of . same plot. It is stated that the plot was sold for Rs. 78, 000 in the accounting year, relevant to the assessment year 1981-82. Since each of the brother had 1/2 share in the plot, capital gain of Rs. 8,000 was equally divided. Before the assessing officer, it was claimed that both the assessees spent the amount out of the savings made by them from the agricultural income accruing to them for the assessment years 1974-75 to 1980-81. However, the submissions of the assessees did not. find favour with the assessing officer, who made the additions of Rs. 35,000 in each case treating the same as income from undisclosed sources.
3. It was contended before the learned Commissioner (Appeals) that each assessee disclosed full particulars of their agricultural income, as per following details Asst. yr Amount 1974-75 4,500 1975-76 4,000 1976-77 5,000 1977-78 4,500 1978-79 4,500 1979-80 4,500 1980-81 6,000 Misc. savings 2,000 Total 35,000 However, the Commissioner (Appeals) rejected the claim of the assessees for the reasons stated in para 9 of the impugned order.
4. We have heard the learned representatives of both the parties at length and have also perused the orders of the authorities below. It is relevant to mention that Shri R.D. Chatrath, CA, the learned counsel for the assessee reiterated the submissions made before the authorities below and, on the other hand, Shri S.C. Pahwa, the learned Departmental Representative strongly supported the orders of the authorities below. It was brought to our notice that both the assessees were regularly filing their respective returns in the matter of income-tax and wealth-tax from the assessment year 1974-75 onwards. In the returns of income-tax filed, both the assessees had shown agricultural income and the same was accepted and assessed by the department. The assessees had shown the investment in the same plot in the wealth-tax returns for the assessment year 1980-81 and the returns were filed on 8-7-1980 while in the income-tax matters, the returns were filed on 8-10-1980. From these facts, it cannot be denied that the assessees were not (sic) having source for making the investment in the purchase of plot in question. In other words, the assessees were having sufficient income from agricultural produce. In that view of the matter, it cannot be denied that the assessees made the investment out of the income received from agriculture. Accordingly, we delete the addition of Rs. 35,000 made by the assessing officer and confirmed by the Commissioner (Appeals) in each case.
5. Since, we have decided the appeals on merits, and, therefore, we do not think it appropriate to decide the legal issues raised vide ground Nos. 1 to 3 and, therefore, no specific findings are being given.
6. Ground No. 5 is general in nature and hence no findings are called for.
7. In the result, both the appeals are partly allowed.