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TMI Blog2017 (12) TMI 526X X X X Extracts X X X X X X X X Extracts X X X X ..... ion of Rs. 93,484/- in the head of unexplained expenditure. 4. That under the facts and circumstances of the case ld CIT(A) erred in deleting the addition of Rs. 71,937/- in the head of concealed income earned from security charges. 5. That the appellant craves to add or amend any grounds of appeal on or before the date of hearing." 3. Ground No.1 and Ground No.2 raised by the Revenue relate to addition of Rs. 54,20,000/- on account of unexplained cash credit and Rs. 14,00,000/- on account of unexplained money u/s 69Aof the Income Tax Act, 1961. 3.1 The brief facts qua the issues are that Mr. Devender Jeet Singh Kler, the assessee, is an ex-military person. During the course of scrutiny proceedings for the A.Y. 2009-10, the Assessing Officer added Rs. 54,20,000/-, under section 68 and Rs. 14,00,000/- U/s 69A of the I.T. Act .The assessee had deposited cash of Rs. 54,20,000/- in the savings bank a/c of Indusind bank Khanna and Rs. 19,00,000/- found credited into the S.B A/C No. 018- E04964-010, Indusind Bank, Khanna. When the Assessing Officer asked to explain about the source of cash deposit of Rs. 54,20,000/-, then the assessee explained that, it was a sale proceeds of 4 lan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ITO noted that in one of the sale deeds for an amount of Rs. 4,12,500/- Shamsher Singh Kler was not described as constituted attorney of the assessee's father. The assessee explained that there was a drafting error in the deed, which was executed by Shamsher Singh Kler in his capacity as constituted attorney. It was submitted that it would be evident from the sale deeds, affidavit of the assessee's father and sale bill relating to household goods including silver submitted to the ITO in course of the assessment proceedings and the aforesaid documents that the assessee's father Hardev Singh Kler was the owner of the agricultural lands which were sold under the four sale deeds all dated September 19, 2008 for an aggregate sum of Rs. 50,02,500/- received in cash. The sale deeds which the consideration amount was duly registered with the registering authority on September 19, 2008. The sale deed for Rs. 4,12,500/- was also in respect of agricultural land bellowing to the assessee's father and was executed by Shamsher Singh Kler as constituted attorney of the assessee's father even though not expressly stated therein. Household goods including silver belonging to the assessee's father ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 's father did not file the return of income because agricultural land was exempt from capital gain tax. The assessee retired from the Indian Air Force as a Wing Commander and he was in receipt of pension. He has interest income and a small amount of income from the business of providing security services. The assessee's father Hardev Singh Klerwas a decorated soldier and participated in the Bangladesh war. The assessee's grandfather Chajja Singh was also in the Indian Army, though in the pre-independence era. In fact, the land in question was given by the Government to Chajja Singh in recognition of his service. The CIT(A) noted that this background was important for deciding the matter. The ld. CIT(A) observed that addition of cash credits was open to the authorities only when there was material to show that the assessee carried on an independent business apart from the business on which the assessment was being made. The CIT(A) noted that the assessee resides at Kolkata. The bank account was opened by the assessee on September 19,2008 at Khanna in the State of Punjab. On the same day, four conveyance deeds were said to had been executed before the Additional District Sub-Regisra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re such certified copies because they are typed out on two pages whereas the photocopies submitted by the assessee in course of the assessment proceedings ran into several pages. The photocopies which the assessee had filed in course of the assessment proceedings were of the original deeds typed out on stamp papers with large spaces between each line in order to use up all the stamp papers. The same matter when typed out in single space for issuing certified copy has fitted in one and half pages. Just because the certified copies so typed out were in lesser number of pages than the original documents cannot be a reason to ignore the documents. The Assessing Officer had not pointed out any difference in the contents of the photocopies of the sale deeds submitted at the time of assessment and the certified copies subsequently received from the Additional District Sub-Registrar, Khanna. In fact, the said official had stated in his letter dated June 10, 2013 that the contents of the sale deeds on stamp paper and those of the certified copies are the same. The CIT(A) observed that the controversy raised by the Assessing Officer with regard to land revenue records was also unjustified. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... opy of the sale bill in respect of the household articles of his father. The assessee's father having moved to USA in 2005, wished to dispose of his household articles in India. Since the assessee had gone to Punjab in connection with sale of his father's agricultural land, he used the opportunity to also dispose of his father's household articles. The main reason why the AO did not accept the assessee's explanation was that the assessee's father in his affidavit dated November 16, 2011 did not mention about the return of Rs. 5,00,000/-. He considered the subsequent affidavit dated January 10, 2013 of the assessee's father about the return of Rs. 5,00,000/- as contradicting his previous affidavit dated November 16, 2011. The second affidavit explaining the inadvertent omission in the first affidavit cannot be considered as contradicting the first affidavit. It simply seeks to state a fact which got left out in the first affidavit. Even the AO has added Rs. 14,00,000/- accepting the return of Rs. 5,00,000/- to Harnek Singh. The CIT(A) observed that the particulars of the household articles were mentioned in the sale bill. Such articles were items like furniture and fixture, carp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arded by British Govt. to his grandfather Mr. Chhajja Singh but the Assessee failed to produce any evidence regarding this award. The assessee should have produced at least the paper of Mutation of land either in the name of his father or in the name of his grandfather because before selling any immovable property 'Mutation' is required. Besides, The DR also pointed out that there was no need to deposit the cash in several days but the assessee did it and it was accepted without supporting any valid reasons. During the assessment proceedings the assessee also did not submit the purchase documents of house hold articles. 3.5 Before us, the ld. counsel for the assessee has submitted the copy of sale deed of agricultural land vide Sale Deed Nos.2956, 2953, 2955, and 2954. The sale deed contains the details of agricultural land and details of the buyers and sellers of the agricultural land. The assessee also submitted the identity of the buyers and sellers of landand the copy of the passport. The ld. counsel submitted that a major part of the money deposited in the bank account represented sale proceeds of his father's agricultural land. The assessee used to provide security ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he revenue authorities. 3.6 Regarding the addition of Rs. 14,00,000/- under the head of unexplained money u/s 69A. The Counsel for the assessee has submitted that the assessee had provided to the AO a copy of the sale bill in respect of the household articles of his father. The assessee's father having moved to USA in 2005, wished to dispose of his household articles in India. Since the assessee had gone to Punjab in connection with sale of his father's agricultural land, he used the opportunity to also dispose of his father's household articles. The main reason why the AO did not accept the assessee's explanation was that the assessee's father in his affidavit dated November 16, 2011 did not mention about the return of Rs. 5,00,000/-. He considered the subsequent affidavit dated January 10, 2013 of the assessee's father about the return of Rs. 5,00,000/- as contradicting his previous affidavit dated November 16, 2011. The second affidavit explaining the inadvertent omission in the first affidavit cannot be considered as contradicting the first affidavit. It simply seeks to state a fact which got left out in the first affidavit. Even the AO has added Rs. 14,00,000/- accepting the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er. The AO did not bring on record and cogent evidence to prove that sale bills of household articles are bogus. Based on the factual position, we are of the view that order passed by the CIT(A) does not contain any infirmity. Therefore, we confirm the order passed by the ld. CIT(A). 3.8 In the result, the appeal filed by the Revenue (in Ground No.1 and 2) are dismissed. 4. Ground No.3 and 4 raised by the Revenue relates to addition of Rs. 93,484/- under the head of unexplained expenditure and addition of Rs. 71,937/- under the head concealed income earned from security charges. 4.1 Brief facts qua the issues are that during the course of scrutiny proceedings the A.O added Rs. 93,484/- u/s 69C on account of unexplained expenditure because assessee made a little drawings for family expenses. Therefore, the AO made the addition,after observing the luxurious life style of the assessee. The ld Counsel pointed out that the assessing officer made addition on account of low drawings but the Ld. CIT (A) deleted the addition because the assessee was supported by his son. The ld. Counsel for the assessee has submitted before us that for the addition of Rs. 93,484/- on account of low dra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ,34,473/- on account of security service charges and had paid Rs. 1,37,301/- to the security personnel who had provided the security services. It was explained that the Accountant had debited payment to the extent of Rs. 71,937/- made to the security personnel to the account relating to security service charges received. The result was that the security service charges received got netted off to the extent of Rs. 71,937/- but such netting off did not have any effect on the income. If the security service charges of Rs. 1,62,536/- shown in the profit and loss account were increased by Rs. 71,937/-, the payment made to security personnel shown as expenditure in the profit and loss account would also have to be increased by the like amount. The AO, however, treated the sum of Rs. 71,937/- as concealed income ignoring the explanation that the amount paid to security personnel had to be increased by the like amount and consequential there would be no effect on the income. We note from the remand report that the AO has not controvert the fact that payment of Rs. 71,937/- to security personnel was debited to the security service charges received account resulting in netting off of the rec ..... X X X X Extracts X X X X X X X X Extracts X X X X
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