2023 (3) TMI 520 - AT - Income Tax

Unexplained deposits in bank account - source of such deposits and sale transaction of agriculture land owned by the assessee - HELD THAT:- In the instant case, we find that there were cheque deposits of Rs 39,61,000/- on 22/02/2010 within few days of execution of sale deed on 19/02/2010 and therefore a clear nexus has been established between source of such deposits and sale transaction of agriculture land owned by the assessee. The same is corroborated from the bank statements of the buyer where the particulars of cheque deposits in the assessee’s bank account exactly tallies and only inference which can be drawn is that the deposits are towards receipts of sale consideration of agriculture land.

We are conscious of the fact that though the sale deed shows lower sale consideration which is also the stamp duty valuation however, once the assessee has brought on record the relevant facts and documentation as well as nexus between transaction of sale and deposit in bank account has been established then in absence of any contrary evidence brought on record, only inference which can be drawn from these facts and circumstances of the case is that the nature and source of deposit is nothing but represent the full value of consideration from sale of agriculture land so sold by the assessee and thus stand explained.

The factum of agriculture land not being a capital asset has not been disputed by the Revenue in the instant case and thus, the full value of the consideration is not liable for tax and addition so sustained by the ld CIT(A) which represent a part of consideration is hereby directed to be deleted and the matter is decided in favour of the assessee.