Home Case Index All Cases Income Tax Income Tax + HC Income Tax - 2005 (2) TMI HC This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2005 (2) TMI 95 - MADHYA PRADESH HIGH COURTUndisclosed income - Genuineness of the transaction - Deposit against tenancy - typographical mistake - Whether the Appellate Tribunal was justified in holding that in respect of deposit against tenancy, the assessee was only required to prove the identity of the depositors and that the deposit was made by the tenants? - HELD THAT:- We are of the view that where the tenancy is established and the tenant is actually in occupation of the premises and a lease deed or tenancy agreement is produced showing the amount agreed to be paid as deposit and the deposit is paid by cheque or demand draft and is duly accounted in the books of account of the assessee as also the tenant, it should be held that the assessee has discharged his burden u/s 68 of the Act. If the Assessing Officer still wants to treat such amount as unexplained income of the assessee, then the burden lies on the Revenue to establish that the deposit was not really a deposit by the tenant, but the unexplained income of the assessee channelised through the "tenant". The first question is, therefore, answered in the affirmative. It is however clarified that the identity of the depositor and the genuineness of the deposit have to be established by showing that the person making the deposit is in occupation of the assessee's premises as a tenant or had occupied the premises for a considerable time and the deposit was paid by cheque/bank draft and borne out by the books of account of both the assessee and the tenant and by the lease agreement, wherever such lease agreement exists. Whether, the Appellate Tribunal was justified in holding that the assessee had discharged the burden in respect of deposits of Rs. 2,70,000, Rs. 1,05,000 and Rs. 85,000 received from tenants during the accounting years relevant to the assessment years 1989-90, 1990-91 and 1991-92? - We find that the Tribunal has not given any reason to disagree with the finding of fact recorded by the Assessing Officer and the appellate authority, nor assigned any reason to hold the transaction relating to Rs. 40,000 as genuine. We agree that the said sum of Rs. 40,000 will have to be added to the income of the assessee. We, therefore, hold that the Tribunal was justified in holding that the assessee had discharged the burden in respect of deposits aggregating to Rs. 2,55,000, Rs. 1,05,000 and Rs. 85,000, respectively received from the tenants during the accounting years relevant to the assessment years 1989-90, 1990-91 and 1991-92. The second question is answered accordingly. Whether the Appellate Tribunal was justified in holding that reference to the DVO u/s 131(1)(d) can be made only during the pendency of assessment proceedings and neither earlier nor subsequent? - We respectfully agree with the observations in Jamnadas Madhavji and Co. v. J. B. Panchal,[1986 (3) TMI 43 - BOMBAY HIGH COURT]. In this case, as no proceeding in regard to the assessment year 1990-91 was pending before him on November 29, 1989, obviously he could not have issued the commission u/s 131(1)(d). The third question is answered accordingly in the affirmative. Whether, the Appellate Tribunal was justified in rejecting the valuation report of the DVO and directing the Assessing Officer to make the addition as per the valuation made by the approved valuer? - In view of our answer to question No. (3), it follows that issue of a commission by the Assessing Officer on November 29, 1989, prior to the initiation of the assessment proceedings relating to the assessment year 1990-91 was not valid and consequently, the valuation report of the DVO received in pursuance of the invalid commission cannot be made use of. If the same is excluded, what was available was the valuation report of the approved valuer which showed the value of the commercial complex as Rs. 8,50,000 as against Rs. 8,00,000 declared by the assessee and the other two owners. Therefore, question No. (4) is also answered in the affirmative. The reference is disposed of accordingly.
|