TMI Blog2024 (4) TMI 734X X X X Extracts X X X X X X X X Extracts X X X X ..... HIGH COURT ] has observed that the provisions of section 69C of the Act are applicable with respect to the expenditures which have actually been incurred by the assessee and the assessee fails to offer any explanation about the source of such expenditure. From the judgement, it s transpired that actual expenditure, the source of which has not been explained, should have been incurred for attracting the deeming provisions provided u/s 69 of the Act. In the present case there were several justifiable factors for the delayed payment against the purchase of land. These justifiable factors have been elaborated in the preceding paragraph and the same has not been doubted by the revenue authorities. Thus, in such facts and circumstances, we are of the view that the addition cannot be made in the hands of the assessee merely on the reason that the assessee got the property transferred through registered sale without making the payment to the vendor. There was no document brought on record by the Revenue suggesting that the assessee has incurred the expenses in connection with the purchase of land in cash so as to apply the provisions of section 69 of the Act. As such, the provisions of se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . On the facts and in the circumstances of the case, the Id CIT(Appeals) ought to have deleted the addition of Rs. 95,47,000/- made by the Ld.AO on totally irrelevant grounds and merely on assumption. The addition be deleted now. 6. The appellant craves leave to add, amend, alter, edit, delete, modify or change all or any of the grounds of appeal at the time of or before the hearing of the appeal. 3. The only effective issue raised by the assessee is that the learned CIT(A) erred in confirming the addition of Rs. 95,47,000/- under section 69 of the Act. 4. The assessee, a private company, is carrying out the business of wholesale trading of vegetables. The AO as per ITS Data found that the assessee during the year purchased 2 immovables properties for Rs. 95,47,000/- registered with sub-registrar office (hereinafter SRO) Kadi, Mehsana, but no such property was disclosed in the books of accounts. On enquiry by the AO under section 133(6) of the Act, the SRO kadi in response provided copies of sale deed bearing registration Nos. 3712/2014 and 3713/2014 through which assessee purchased the immovables properties. As per the sale deed Nos. 3712/2012 3713/2014 dated 14-07-2014, the asses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e same has been rectified. Accordingly, the AO concluded that the circumstances suggest that the consideration was paid from unaccounted sources and so-called cheque issued by the assessee as mentioned in sale deed but never honored is nothing, but a camouflage and the story of title defect are cooked up. Hence, the AO made addition of Rs. 95,47,000/- on account of unaccounted income used for the purchase of such land property. 5. The aggrieved assessee preferred an appeal before the learned CIT(A). The assessee before the learned CIT(A) contended that the lands purchased by it through sale deed was not disclosed in the books as the consideration was not paid due to dispute. The AO made addition merely on the reasoning that the payment of consideration was not disclosed. The evidence of payment of purchase consideration was not furnished before the AO as there was no payment made till the date of finalization of assessment order but the same has been paid after assessment order as on 29th March 2018 through RTGS. The sale deed also got corrected by execution of correction deed and same has been registered with SRO Kadi. The assessee in support of contention furnishes the detail of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the AO that the registered sale deed in land matters is entered into by the party only after due diligence of title etc. and registered agreement are signed only after realisation of payment. Appellant has not reflected the land in the balance sheet as on 31/3 / 2015 though the lands have been transferred in the appellant's name and possession has been handed over. Appellant has relied upon various vase laws which are not relevant over the facts of the case. In view of the above, the addition made by the AO is found correct and the same is confirmed. 9. Being aggrieved by the order of the learned CIT(A) the assessee is in appeal before us. 10. The learned AR before us submitted that the assessee company belong to Karamchandani family of Mehsana, Gujarat. Its flagship company is M/s Asandas and Sons Pvt Ltd. The family has been engaged in the business of agricultural products for the last 50 years. The land in dispute bearing survey No. 188 is adjacent to survey No. 189 held by assessee company which has been given to M/s Asandas and sons where its factory produces the products under the brand name hyfun food . 10.1 The property in dispute belongs to Saini family of Mehsana ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on record/ in the written submission of the assessee. ii. The payment for the land in dispute was finally made by the assessee through the banking channel dated 29 March 2018 which is evident from the details available on record. iii. There was rectification in the sale deeds about the payments made by the assessee to the landowners. iv. The landowner has also given a guarantee to the bank with respect to the loan availed by the assessee from the bank. v. There was no iota of documentary evidence available with the revenue suggesting that the assessee has made payment in cash. 12.1 The Hon ble High Court of Gujarat in the case of Commissioner of Income Tax versus Shri Babul Harivadan Parikh in tax appeal No. 132 of 2013, involving identical facts and circumstances has upheld the finding of the Tribunal which is reproduced as under: Apart from that even we have considered the reasoning given by the ITAT in order passed in quantum appeal and while deleting the addition of Rs. 30.93 lacs and considering the reasons given by the Tribunal in para 5, we are of the opinion that as such the Tribunal had not committed any error in deleting the addition of Rs. 30.93 lacs. Para 5 is reproduce ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... evidence on record that the assessee received cash for return of the cheques. The AO has also not recorded any statement of concerned person of M/s. Om Shivam Corporation that the said firm has paid the amount in question to the assessee. No statement either of the assessee or of M/s. Om Shivam Corporation in this regard has been brought on record. Considering the facts and circumstances of the case noted above, we are of the view that addition is made against the assessee merely on presumption or suspicion expressed by the AO regarding some facts which are not in existence. The law is settled that suspicion howsoever may be grave but it cannot take the place of legal proof. For making addition u/s 153C of the IT Act, the AO shall have to prove that the seized documents or the undisclosed income belongs to the assessee. In the absence of any cogent or reliable evidence available on record regarding alleged receipt of cash by the assessee, the authorities below were unjustified in making and confirming the addition. In the absence of any evidence incriminating in nature against the assessee, we do not justify the addition. We accordingly, set aside the orders of the authorities belo ..... X X X X Extracts X X X X X X X X Extracts X X X X
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