TMI Blog2013 (7) TMI 771X X X X Extracts X X X X X X X X Extracts X X X X ..... g of fact – appeal decided against the assessee. - - - - - Dated:- 16-1-2013 - JOSEPH K. M. AND ABDUL REHIM C. K., JJ JUDGMENT The judgment of the court was delivered by K. M. Joseph J.-The following substantial questions of law were raised in the appeal memorandum : "(i) Whether, on the facts and in the circumstances of the case, the Appellate Tribunal is justified in confirming the addition of Rs. 5 lakhs to the income from business/profession ? Is not the above addition illegal and perverse in the facts and circumstances of the case ? (ii) Whether, on the facts of the case, the Appellate Tribunal is justified in confirming the addition of Rs. 16 lakhs as net long-term capital gains without allowing any deduction for cost and indexed cost of acquisition, in respect of the amount paid or obtaining the lease of the residential flat in 1961 and subsequent amounts spent on repairs ? (iii) Is the Appellate Tribunal justified in not following the decision of the co-ordinate Bench in the case of the P. V. Radhakrishnan v. ITO in I. T. A. No. 167/Coch/2006, dated January 11, 2008, which was rendered more or less on similar facts ? Is not the decision of the Appellate T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed. The Assessing Officer, however, did not accept the later version. Instead the Assessing Officer pointed out that appellant admitted during the course of search that cash deposits were made by him in all the three accounts out of the receipts from consultation. None of these deposits was maturity amount of any fixed deposits and, accordingly, the entire deposit amounting to Rs. 8 lakhs was treated as professional income. Still further, in the sworn statement taken at the time of search, the assessee stated that the assessee had received Rs. 20 lakhs by cheque by surrender of the tenancy right of the flat at Mumbai. "Question No. 1 : On your statement recorded by the income-tax authorities on June 14, 2007, you have stated that you have received Rs. 20 lakhs (20,00,000) for transferring your tenancy right of the flat in Bombay. Please tell the utilization of that amount and also state whether you have paid tax on the capital gains ? Answer No. 1 : I received Rs. 20,00,000 as cheque which was deposited in my bank account of HSBC, Mumbai, in November 2004. From this amount, I paid Rs. 8 lakhs, to my eldest daughter through cheque. Another Rs. 6 lakhs (six lakhs) was deposited ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t on account of surrender of tenancy right. This fact is duly admitted by the appellant. The cost of acquisition in respect of receipt of surrender of tenancy right is to be taken as nil as is duly provided in section 55(2)(a)(ii). I thus find that the action of the Assessing Officer was strictly in accordance with the relevant provisions of law. The claim of the appellant that he incurred a cost of Rs. 20,000 as pugree for taking the flat in 1961 was, therefore, not relevant in the matter. Further to the above, this claim of the appellant is contradicted by himself when he claims in the same written submissions that Rs. 20,000 was spent for repairing the flat which in any case was a recurring expenditure and does not constitute cost of acquisition. Notwithstanding the same it is further seen that there is no supporting evidence for the claim of the appellant that he paid Rs. 20,000 in 1961 to acquire the tenancy right. There is no acknowledgment of the recipient on record. The corresponding source of funds have also not been explained by the appellant. From the submissions of the appellant itself it is apparent that the appellant paid to the owner only a refundable deposit of Rs. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was given to him on rent in 1961 had made certain payments to my grandmother, Gangubhai Yewle, owner (who is no more) to have the flat vacated by the previous tenant and to carry out certain essential repairs to have the place habitable." On consideration of the materials and also keeping in view the ground realities, the Tribunal ought to have granted relief to the appellant, he contends. He would submit that this court may remand the matter back to the Tribunal. Per contra, learned counsel for the Revenue would submit that interference in an appeal under section 260A is permissible only if substantial question of law is made out. He would submit that the Tribunal has entered findings on fact which are not vulnerable to interference in appeal. They are not perverse, it is submitted. We are of the view that there is no merit in the appeal. As far as the question arising apparently from an amount of Rs. 8 lakhs in bank deposits being brought to tax or rather an amount of Rs. 5 lakhs being brought to tax, we have already taken note of the statement given by the appellant at the time of search. The attempt which was made by the appellant, which he continues to do before this ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... unt of Rs. 20,000 has been given to the owner for repairs of the flat, so that the same did not admittedly constitute the cost of acquisition either of the flat or any right there of. The Tribunal also notes that when for Rs. 335 he maintains receipts, it is incomprehensible that he would qua an amount 60 times higher not keep receipts. It is further noted that there is no question of the appellant paying such a heavy amount approximating the cost of the flat itself as inferred from the fact of the same being 180 times (approximately) the monthly rental, without proper documents issued. In this connection, we may notice that a perusal of the order passed by the Tribunal, which is relied on that is I. T. A. No. 167 of 2006 reveals that it is not a case where a statement was given, as given by the appellant in this case. That was a case where the appellant, right from the beginning set up a case that he had paid Rs. 15,000. There was a certificate issued by the ISKCON. In the said case, the Tribunal took note of the practice (we are told by the learned senior counsel for the appellant that apparently the officer derived knowledge of such a practice on the basis of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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