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2016 (7) TMI 852 - ITAT AHMEDABAD

2016 (7) TMI 852 - ITAT AHMEDABAD - TMI - Addition of unexplained investments in purchase of agricultural land u/s 69 - Benami transations (Prohibition) Act 1988. - Held that:- There is no evidence on record rebutting the same. We further find that this assessee has been showing agricultural income as per the impugned order. This is not the case with co-purchaser Shri Girish Kumar. We notice that he is in fact a cloth trader. That being the case, this co-purchaser could not have purchased the ag .....

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is the sole owner thereof as per the provisions of the Benami transations (Prohibition) Act 1988. - We have already held this assessee to have paid the entire purchase consideration of ₹ 83,13,850/- in question forming subject matter of the impugned unexplained investment addition made u/s.69 of the Act. The same stands confirmed. - Decided against assessee. - ITA. No.2272/Ahd/12 - Dated:- 11-7-2016 - SHRI S. S. GODARA, JUDICIAL MEMBER AND SHRI MANISH BORAD, ACCOUNTANT MEMBER For The .....

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ricultural land amounting to ₹ 83,13,850/-. 3. We come to relevant facts first. This assessee along with one Shri Girish Ramanlal Vyas purchased agricultural land admeasuring 2 hectares 23 acres and 56 sq.mtrs. in Khata no.745, Survey No.1036, Village Kathwada, Taluka Dascroi, Dist. Ahmedabad by way of registered purchase deed dated 29.09.2008. The sale consideration therein reads a sum of ₹ 78,50,000/- followed by stamp duty and registration charges of ₹ 3,85,000/- and 78,850/ .....

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ser having borne the entire purchase price and his name was merely in the capacity of a friend. The other co-vendee in fact executed an affidavit dated 22.06.2010 supporting the assessee s case. He took a contrary stand in his own assessment through a reply filed on 22.12.2011 pleading therein that no payment of the purchase price was in fact made since the entire transaction was based on a fraudulent power of attorney and same stood cancelled later on. He further stated to have executed the aff .....

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rish Ramanlal Vyas have purchased an agricultural land jointly admeasuring two hectares, 23 acres and 56 sq. meters for a total consideration of ₹ 78,50,000/-. Purchase deed was executed and registered in the office of Sub-registrar, AHD-7, Odhav, Ahmedabad at Sr. No. 11870 - 2003 on 29.09.2008. b) That the entire sale consideration of ₹ 78.5 lacs was paid in cash in piecemeal. This factum of payment in cash is evident in column No. 11 on page 19 & 20 of the purchase deed. The st .....

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he assessee has submitted before the AO that the entire purchase price of ₹ 78.5 lacs with stamp and registration charges was paid by Shri Girish Ramanlal Vyas alone. e) That the AO, while recording the statement of Shri Girish Ramanlal Vyas, also observed question No.5 that Shri Girish Ramanlal Vyas submitted under oath that he paid only ₹ 11 lacs as a token money. Shri Girish Ramanlal Vyas also submitted under oath that stamp duty and registration expenses were incurred equally by .....

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has given opportunity to the appellant to cross-examine the other co-owner, Shri Girish Ramanlal Vyas which was duly done by the appellant. 4.2 During the course of appellate proceedings, the appellant rebutted the observation of the AO. The relevant portion of the submissions are reproduced herein as under for the sake of convenience: "These findings of the assessing officer are rebutted as under. 1. As noted in the assessment order assessee filed return of income 22-07- 2009 and his case .....

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as has executed affidavit on 22-06-2010 pointing out that the document of agricultural land was executed on 29-09-2008 vide registration No.11870. But the real fact is that the alleged cash consideration of ₹ 78t50,000 was paid by Girish Ramanlal alone and this land has been purchased by him alone. Further he has also clarified that as joint owner the name of Shri Chandrakant Nathalal being assessee has been shown as friend only. In this land Chandrakant Nathalal has no share or right of w .....

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rish Ramanlal Vyas who is also party to the sale deed proves beyond doubt the contentions of the assessee that he has not invested any amount in the land and he has not incurred any expenditure towards any stamp duty and registration charges. It is pertinent to point out that this affidavit has been executed before the return of income filed by the assessee was selected for scrutiny because the date of notice issued u/s 143(2) is 20-08-2010 whereas the date of affidavit is 22-06- 2010.When the a .....

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allegation of tax avoidance against the assessee. By this documentary evidence the burden of proof on the assessee that no investment has been made by him is fully discharged. 4. The assessee has came to know that the assessment of Shri Girish Ramanlal Vyas having PAN:ABIPV 5929R for A. Y.2009-10 has also been passed under scrutiny and from the said assessment order it is noticed that same addition of ₹ 83,13,850 has been made in his case for the purchase of same agricultural land on subs .....

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principle of law laid down by the Supreme Court in the case of ITO V/s C.H.Atchaiah 218 ITR 239, that A.O can and he must tax the right person and the right person alone1. 5. Sale deed bearing No.11870 dated 29-09-2008 has been executed between assessee and Girish Ramanlal Vyas as purchaser and Shri Bijalbhai Khengasrbhai Rabari residing at Morali Gam Dist. Gandhinagar. As mentioned in the sale deed this land has been purported to have been purchased by the seller from the original land owners S .....

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iginal owners at that time and even to-day also. It has been further clarified that no payment on execution of sale deed was paid to the seller. It may kindly be noted that this cancellation deed 30-06-2010 has also taken place prior to the initiation of scrutiny proceedings which has taken place in the month of August.2010. 6. Another document titled as Kabulat Cum Indemnity Bond has been executed on 30-6-2010 duly registered with the Sub-Registrar vide registration No.9185 between Shri Bijalbh .....

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s executed are hereby cancelled. It may kindly be noted that this deed dated 30-06- 2010 has also taken place prior to the initiation of scrutiny proceedings which has taken place in the month of August.2010. 7. It is also relevant to point out that Special Suit No 474/2008 was filed on 23-10-2008 as mentioned above. Pursuant This Suit filed by the original land lord Shri Ranchodbhai Bhalabhai Patel and others against (1) Shri Bijalabhai Khengarbhai Rabari and(2) Desai Melabhai Gokabhai the Cour .....

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efore due date of filing of return for A.Y.2009-10. Because of criminal complaint in the year 2008 and the civil suit also filed in the year 2008 the parties to the bogus sale deed were forced to execute cancellation deeds to escape, legal actions consequences. The impugned sale deeds were executed in the month of September ,2008 in the month of October 2008 itself the land owners on 9. Coming to know of such forged deeds swiftly moved the court for the intervention and declaring the said deeds .....

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before making the assessment. (Refer to decision of Sumati Dayal 214 ITR 801 S.C) Therefore the findings/observations/ comments appearing on page 16 of assessment order are contrary to the law and therefore deserved to be rejected. 10. After submission of these legal documents which have also been executed prior to initiation of scrutiny proceeding and if the assessing officer was doubting these documents and considering these documents as an afterthought then he was under legal obligation to m .....

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h statement there was no basis before the assessing officer and hence the entire finding of the assessing officer gets vitiated legally as well as factually. 11. In view of above facts and circumstances the addition of ₹ 83,13,850/- made u/s. 69 as unexplained investment deserves to be deleted in its entirety." 4.3 I have perused the assessment order, paper-book along with other evidences filed by the appellant and material on record, lam not inclined to agree with the contentions of .....

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avit is made just to favour the appellant and therefore statement recorded u/s. 131 of the Act is true and correct and final and is devoid of merits as it is contrary to facts mentioned in purchase deed and as well as affidavit filed by Shri Girish Ramanlal Vyas. It may be noticed that the facts in the affidavit by Shri Girish Ramanlal Vyas are completely in variance to the facts submitted under oath before the AO. (c) The plea of the appellant that substantive additions have already been made i .....

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be income of either of two parties, the IT authorities' action of assessing income protectively has been held justified even by Hon'ble Supreme Court of India - Lalji Haridas Vs. ITO & Anr. (S.C.) 43 ITR 387. 4.5 Under the stated circumstances, that there is a sale deed wherein cash payment of ₹ 78.5 lacs is evidenced and stamp duty is also paid in cash, the contradictory statement given by the other co-owner i.e. Shri Girish R. Vyas. When compared with his affidavit dated 22.0 .....

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s paid the entire purchase consideration even if the same is to be added without prejudice to the former stand. He further highlighted the facts both the lower authorities have assessed the very sum on substantive basis in co-purchaser s hands. The assessee accordingly seeks to add the entire sum in case of his co-purchaser in view of his affidavit dated 22.06.2010. Learned Counsel accordingly prays for the acceptance of the appeal. The Revenue strongly supports the lower appellate s order. 6. W .....

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d mutually contradictory stands so as to evade the burden of explaining source of the gross investment amount. There can be hardly any dispute that this explanation was source of the investment in question has no bearing with the fact that the above stated sale deed stood cancelled later on for any reason; whatsoever. We reiterate that it s a registered sale deed carrying presumption of truth. We are of the opinion that the assessee s first argument that the sale deed cancellation renders the en .....

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concerned (supra). Both the lower authorities have elaborately appreciated the relevant facts as extracted hereinabove to conclude that it is actually assessee s investment and not that of his co-purchaser. There is no evidence on record rebutting the same. We further find that this assessee has been showing agricultural income as per the impugned order. This is not the case with co-purchaser Shri Girish Kumar. We notice that he is in fact a cloth trader. That being the case, this co-purchaser c .....

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