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2016 (5) TMI 342 - ITAT AHMEDABAD

2016 (5) TMI 342 - ITAT AHMEDABAD - TMI - Addition u/s. 69 - undisclosed investment - Held that:- The investment has been made under the arrangement of an MoU and the other persons have a beneficial interest in the property. In this regard, we find that the assessee has made investment of ₹ 6,50,000/- only in the property and the other two persons namely; Shri Arvindbhai Patel and Shri Vinodbhai Solanki has made the investment of ₹ 65,00,000/- and ₹ 58,94,325/- respectively. Th .....

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CIT(A) has also rightly observed that the source of investment by the other two persons, who have owned the amount of investment in the land, was not clear. He also pointed out that since the other two parties have owned the investment, the Assessing Officer should have to investigate the source of investment in their respective hands by initiating appropriate proceedings and in case they were not assessed with the Assessing Officer, the concerned Assessing Officer should have to pass on the in .....

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dition without inviting objections from the assessee and without giving reasonable opportunity of being heard. There is nothing on record to suggest that the Assessing Officer has issued any summons to the respective parties. In this case, we find that the depositors in this case are established their identity and genuineness of the transaction as the transactions were routed through the banking channel; more so, the assessee has submitted the confirmation from the two depositors, indicating the .....

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harged his onus, i.e, the burden of proof; therefore, the addition in question is not justified and the same is directed to be deleted.- Decided in favour of assessee - ITA No. 169/Ahd/2012, ITA No. 219/Ahd/2012 & CO No.81/Ahd/2012 - Dated:- 31-3-2016 - SHRI SHAILENDRA K. YADAV, JUDICIAL MEMBER AND SHRI N.K. BILLAIYA, ACCOUNTANT MEMBER For The Assessee : Shri S.N. Divatia, AR For The Revenue : Shri Dinesh Singh, Sr. DR ORDER PER SHAILENDRA K. YADAV, JUDICIAL MEMBER: These cross appeals by the as .....

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n of ₹ 20,00,000/- in the following matter: 1. The ld. CIT(A) has erred in making income addition u/s - 68 of the Act in respect of ₹ 20 lacks loans received through banking channels from Jayambe Traders and Smt. Rekha N. Patel. The parties are assessed to income-tax, having PAN and also confirming the fact of granting loan. More so, when the A.O. has made income addition without inviting objections from the appellant without giving reasonable opportunity of being heard. It be held s .....

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recording of such satisfaction the notice itself is illegal and bade in law. It may be held so. 3. Your appellant therefore prays that the relief may be granted on all grounds by deleting the addition of income and holding that the interest charge is illegal and that the penalty notice issued u/s - 271(l)(c) be quashed. 2.1 The solitary ground taken by the Revenue in its appeal reads as under:- The ld. Commissioner of Income tax (A) has erred in law and on facts in deleting the income addition .....

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e by two others to the effect of ₹ 1,32,97,025/- 2. The learned CIT(A) has erred in confirming the addition of ₹ 20,00,000/- u/s 68 of the Act as unexplained cash credit even though the depositors are assessed to tax and have confirmed the deposits. Reliance is placed on Gujarat High Court decision in the case of Roshni Builders. 3. During the course of assessment proceedings, it was found that the assessee has purchased an immovable property, i.e. land, on a total consideration of & .....

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ee. Regarding the source, the assessee has stated that her total investment was only ₹ 6,50,000/- and rest of the amount including stamp duty expenses were borne out by two persons namely Shri Arvind L. Patel and Shri Vinod Solanki. As per the assessee, the total investment made as per the following:- Purchase cost - Rs.1,32,94,325/- Stamp Duty - ₹ 6,52,700/- Total investment Rs.1,39,47,025/- The details of payment made by different persons was claimed as under:- Parulben B. Patel &# .....

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statement of aforesaid persons was produced before the lower authorities alongwith a Memorandum of Understanding. On perusal of bank statement of Shri Arvind L. Patel and Shri Vinod Solanki, it was noticed that both the persons had deposited ₹ 65,00,000/- and ₹ 58,94,325/- on the same day i.e., on 03.10.2007 in cash and made payorders. The Assessing Officer , after rejecting the contentions of the assessee, treated the amount in question as unexplained and added the same to the incom .....

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ax Act. Accordingly, the Departmental Representative submitted that the order of the CIT(A) may be set aside and that of Assessing Officer be restored. On the other hand, the Authorized Representative for the assessee supported the order of the CIT(A). 3.3 After going through the rival contentions and material on record, we find that the assessee has purchased immovable property and the total investment of ₹ 1,39,47,025/- was made in the said purchase. The assessee explained that she had i .....

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icer after considering the position of the return of income of other persons and the fact that one of them was not having a PAN held that the persons did not have creditworthiness. He accordingly held that it was an unexplained investment u/s. 69 of the Act by the assessee. The stand of the assessee, in this regard, was that since it was nowhere claimed by the assessee that the investment had been made by her, addition u/s. 69 of the Act could not be made. The investment has been made under the .....

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pay-orders have been purchased from their bank accounts and have been given to the revenue authorities. Therefore, the decision of the Assessing Officer holding that the investment belonged to the assessee was not justified and addition u/s. 69 cannot be made in the hands of the assessee. Accordingly, the CIT(A) has rightly deleted the addition in question. The CIT(A) has also rightly observed that the source of investment by the other two persons, who have owned the amount of investment in the .....

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ng the addition in question. Thus, in our opinion, these reasoned finings of the CIT(A) do not require any interference from our side; we uphold the same. 4. Next issue is with regard to the addition u/s 68 of the Act in respect of ₹ 20 lakhs loan received through banking channels from Jayambe Traders and Smt. Rekha N. Patel. 4.1 The facts of the case are that during the course of assessment proceedings, it was noticed by the Assessing Officer that the assessee has taken loan from Jay Ambe .....

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llate Authority, wherein various contentions were raised on behalf of the assessee and having considered the same, the CIT(A) dismissed this ground of the assessee. The aforesaid order of the CIT(A) has been opposed on behalf of the assessee, inter alia, submitting that the CIT(A) erred in upholding the addition of ₹ 20 lakhs, though the amount of ₹ 20 lakhs was received through the banking channel from Jay Ambe Traders and Smt. Rekha N. Patel. The Authorized Representative for the a .....

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e Assessing Officer made addition u/s 68 of the Act in respect of ₹ 20 lakhs loan received through banking channels from Jayambe Traders and Smt. Rekha N. Patel. It is not in dispute that these parties are assessed to income-tax, having PAN and also they have confirmed the fact of granting loan to the assessee. Moreover, it is also pertinent to note that the Assessing Officer has made this addition without inviting objections from the assessee and without giving reasonable opportunity of b .....

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