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Mohan Lal Khandelwal Versus Assistant Commissioner of Income Tax, Central Circle-1, Jaipur.

2015 (9) TMI 18 - ITAT JAIPUR

Addition u/s 69B - unaccounted investment in property - CIT(A) deleted addition accepting addition evidence - Held that:- hatever evidence narrated by the Assessing Officer and CIT(A) shows that the assessee had purchased plot No. 168 Shyampuri Kalwad Road, Jaipur at ₹ 16 lacs. The assessee had shown only ₹ 1,01,000/- paid on date of agreement i.e. on 24/4/2007 but the remaining amount of ₹ 14,99,000/- was paid from undisclosed source. The assessee’s explanation is after though .....

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avit. We have considered view that this issue required further investigation from the side of seller of plot, from Shri Ramesh Sharma purchaser of plot, actual possession of plot etc. The Assessing Officer is directed to take final decision on the basis of enquiry and evidences. Accordingly, this ground of appeal is set aside for de novo. The Assessing Officer is directed to give sufficient time to the assessee before deciding this issue.- Decided partly in favour of assessee for statistical pur .....

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is business is totally unorganized. Therefore, we confirm addition at ₹ 5,000/- in place of disallowance made by the Assessing Officer at ₹ 11,893/- in the interest of justice. - Decided partly in favour of assessee. - ITA No. 330/JP/2013 - Dated:- 11-8-2015 - SHRI R.P. TOLANI AND SHRI T.R. MEENA, JJ. For The Assessee : K.L. Moolchandani (Adv) and Shri R.K. Khuteta (CA) For The Revenue : Shri Dilip Sharma (JCIT) ORDER PER: T.R. MEENA, A.M. This is an appeal filed by the assessee aris .....

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d in the circumstances of the case the authorities below have factually and legally erred in making and confirming the addition of ₹ 11,893/- on account of 1/3rd disallowance out of the taxi running expenses of ₹ 37,540/- without appreciating the facts of the case in right perspective. The addition so made and confirmed deserves to be deleted. 3. On the facts and in the circumstances of the case the authorities below have factually and legally erred in making and confirming addition .....

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ee is having income from house property, business and other sources. He further observed that a search and seizure operation was carried out U/s 132(1) of the Act on 16/11/2007 at the business and residential premises of the assessee. During the course of search and seizure operation, documents/loose papers were found and seized. The assessee filed return for income on 20/01/2009 declaring income of ₹ 2,18,600/-, which inter alia included income from house property showing rental income fr .....

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puri, Kalwad Road, Jaipur from Shri Murlidhar Purohit while sale consideration of ₹ 16,00,000/- . The assessee was asked to file confirmation and also produced Shri Murlidhar Purohit for verification and genuineness of this transaction. The assessee had failed to file confirmation and it was not possible to purchase this property by just giving amount of ₹ 1,01,000/- only and seller had not demanded balance of ₹ 14,99,000/- till date and the property had been shown stock of the .....

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ras of the sale agreement dated 24/4/2007 on page 14 of his order and held that on the basis of this agreement, plot was purchased for ₹ 16 lacs from Shri Murlidhar Purohit by the appellant and out of a total sale consideration of ₹ 16 lacs, payment of ₹ 1,01,000/- was made on the same date i.e. on 24/4/2007. The remaining amount of sale consideration was to be paid by the appellant within 15 days to the seller party. The above terms and conditions definitely indicated that for .....

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nt no sale deed could have been executed, in fact the appellant was competent to execute sale deed at his own. Further it is also noted that after purchase of plot the appellant had shown this property in the books of account i.e. P&L account as closing stock and purchase consideration of ₹ 16 lacs is also shown. The vital question is that if the appellant was not having complete interest in such property how the property can be shown in the books of account as closing stock. The ld CI .....

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rdingly that the remaining payment of ₹ 14,99,000/- was made in unaccounted manner. The revenue has discharged his burden of prove on the basis of material available on record including surrounding circumstances of human conduct and preponderance of probabilities. He relied on the following case laws:- i) Indian and Eastern News Paper Society Vs. CIT (1979) 119 ITR 996 (SC). ii) Dhakeshwari Cotton Mills Ltd. Vs. CIT (1954) 26 ITR 775 (SC). iii) Chuharmal Vs. CIT (1988) 172 ITR 250 (SC) iv) .....

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pellant could have got the sale deed executed in favour of any other party and in view of such specific provisions, there can be strong belief that subsequent registration of the plot in the name of any third party by the seller may have been at the instance of the appellant himself. During the appellate proceedings, the appellant filed affidavit from Shri Murlidhar Purohit dated 2/5/2011 wherein it has been mentioned that plot NO. 168, Shyampuri was still in possession of Shri Murlidhar Purohit .....

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efinitely false and incorrect. Keeping in view of the above fact and particularly such corroboration and circumstantial evidence as discussed above, it is believed that the appellant has made such undisclosed investment/payment of ₹ 14,99,000/- in purchase of this plot and therefore the addition was rightly made by the Assessing Officer. Accordingly, he confirmed the addition. 4. Now the assessee in appeal before us. The ld AR of the assessee has submitted that the appellant belongs to the .....

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IT(A) whereas remaining addition of ₹ 11,893/- i.e. 1/3rd disallowance of expenses and ₹ 14,99,000/- U/s 69B was confirmed by the ld CIT(A). The assessee filed the additional evidence under Rule 46A of the Income Tax Rules, 1962 (in short the Rules), which has been ignored by the ld CIT(A) on the basis of additional evidence not permissible under Rule 46A of the Rules. The ld CIT(A) has not admitted the additional evidence on the ground that these evidences should have been produced .....

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appellant. The agreement to sell made on 24/4/2007 could not be materialized instead of selling the plot to the appellant. The seller had sold the plot directly to a third party Shri Ramesh Sharma of Merta City on 20/10/2008 for forfeiting ₹ 1,01,000/- paid by the appellant as advance to the seller. At the time of assessment proceedings in 2009, the appellant was not on talking terms with the seller due to feud over non-return of the advance money of ₹ 1,01,000/-. The advance money .....

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le to this plot to Shri Ramesh Sharma for ₹ 8 lacs only. Therefore, the ld CIT(A) s finding on additional evidence is devoid of merit and deserves to be quashed. 5. At the outset, the ld DR has vehemently supported the order of the ld CIT(A) and argued that the assessee was not able to produce Shri Murlidhar Purohit before the Assessing Officer to verify the fact. Further affidavit also contradictory wherein the seller admitted on 02/5/2011 that till this date the said plot was in possessi .....

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ent i.e. on 24/4/2007 but the remaining amount of ₹ 14,99,000/- was paid from undisclosed source. The assessee s explanation is after thought when he has disclosed this plot in purchase as well as closing stock in P&L account and balance sheet submitted before the CIT(A) during the appeal proceedings. The affidavit filed by the appellant has partly considered by the ld CIT(A), which also goes against the fact of the case that Shri Murlidhar Purohit filed affidavit on 02/5/2011 and admi .....

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sing Officer is directed to give sufficient time to the assessee before deciding this issue. 7. The 2nd ground of appeal is against confirming the addition of ₹ 11,893/- on account of 1/3rd disallowance out of taxi running expenses of ₹ 37,540/-. The ld Assessing Officer observed that the assessee had never disclosed any income from the taxi business. During the search, the assessee was confronted with incriminating documents seized and he admitted carrying on this business. These ac .....

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ed and log book etc. in absence of which the declared profit was not acceptable. The assessee had claimed travelling expenses at ₹ 35,680/- for which no details had been filed nor any vouchers produced for verification and hence these expenses were not verifiable. The personal element of expenses under this head cannot be ruled out. Therefore, 1/3rd expenses at ₹ 11,983/- was disallowed by the ld Assessing Officer. 8. In first appeal, the ld CIT(A) was confirmed the addition by obser .....

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₹ 35680/- is not wholly supported inasmuch as no supporting vouchers and records for verification of income receipts expenses etc. are produced. The A.O. has specifically mentioned that bills and vouchers in respect of direct petrol expense as well as repairs and maintenance of vehicle expenses were not produced. The A.O. accordingly disallowed 1/3rd of such expenses and made addition of ₹ 11893/-. The appellant s case is that such expenditure of ₹ 37540/- was shown against tax .....

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in respect of such claim of ₹ 35680/- though the ledger detail of such expenses appear to have filed. The important issue to be noted that such claim of expenses of ₹ 35680/- was made by the appellant and the basic responsibility and onus was on the appellant prima facie prove by furnishing reliable documents in form of bill etc. in support of such claim. Simply filing ledger copy of detail of such expenses cannot said to be a proper justification for such claim. As regards the conte .....

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d. in which it has been held that the assessment made earlier and disallowance made and accepted by the assessee can be agitated in case the same additions are made when fresh assessment U/s 153A is made. The above facts will indicate that the issue under consideration before the Hon ble ITAT was totally different. In view of these facts I am of the considered view that the assessee has failed to properly substantiate the claim of whole expenses of ₹ 35680/- and therefore disallowance 1/3r .....

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