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Azad Bansal Versus ITO, Ward-1 (1) , Ghaziabad

2018 (1) TMI 538 - ITAT DELHI

Addition of purchase of housing in joint name as unexplained investment - using past savings - explanation of the taxpayer that half of the amount was paid by his wife - Held that:- The explanation of the taxpayer that half of the amount was paid by his wife where she was an independent taxpayer in her own right deserves to be accepted and consequently the assessee in those peculiar facts and circumstances cannot be saddled with the addition of ₹ 7.50 which has been owned up by the wife; t .....

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is stated to be from his past savings. Accordingly, the impugned order to this limited extent is set aside back to the file of the CIT(A) with the direction to pass a speaking order in accordance with law after considering the assessee’s explanation to the extent of ₹ 7.50 Lacs as the explanation qua his wife for the remaining portion for the reasons given hereinabove is accepted. Appeal of the assessee is allowed for statistical purposes. - I.T.A .No.-6134/Del/2014 - Dated:- 8-5-2017 - SM .....

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,00,000/-. 2. The AO had ignored the fact that purchase of house made in joint name and by ignoring this fact all the payment in cash for ₹ 15,00,000/- treated as made by the assessee. 3. The AO had ignored that the both purchaser of residential house was having NIL capital on the date of purchase. The assessee and his wife are income tax payer from last 10 years and savings out of Income/Stridhan treated NIL. 4. The AO erred in law by treating all payment in cash have been made by the ass .....

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appeal. 2. Both the parties have been heard. The record shows that the assessee declared an income of ₹ 1,84,410/- from petty business activities wherein books of accounts have not been maintained. The AO required the assessee to explain the investment of ₹ 15 lacs in the purchase of house property. The assessee initially was represented by Sh. S.C.Jain, CA thereafter on 12.12.2011 by Sh. Rajeev Kumar, CA. Addition of ₹ 15 lacs was made by the AO by an order dated 29.12.2011 u/ .....

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to be colourable device to explain the source of investment in property. For source of ₹ 7,50,000/- cash, investment by assessee, it is stated that it is out of past savings and current years income/capital. However, the averment has not been supported by any documentary evidence. The evidence of neither opening capital nor current capital has been furnished. It is stated in the reply that 'details of working of availability of this cash of ₹ 7,50,000/- is assessed' but no s .....

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e assessee is computed as under:- Net Income as shown Rs.184410/- Add: as per para-2 above. Rs.15,00,000/- Total income Rs.1684410/-' Assessment for A.Y. 2009-10 is completed on the income of ₹ 1684410/- against returned income of ₹ 184410/-. Issue notice of demand and challan. Charge interest u/s 234A/B/C as per rule. Issue penalty notice u/s 271(l)(c) & 271(l)(b). 3. In appeal before the First appellate authority, the assessee submitted that the purchase of the said propert .....

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t since both the husband and wife were running petty business and continuously filed income tax returns and as per chart filed and had been regularly making drawings for expenses over ten years and also had savings in the form of cash of the assessee and his wife from FY 2001-02 till FY 2007-08. The supporting evidences were claimed to have been attached in support of the explanation before the CIT(A) relying on which it was submitted that the investment was thus fully explained. However, the ar .....

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as submitted has been made by the assesse s wife who is on independent assessee in her own right. 5. Ld.Sr. DR relied upon the impugned order. 6. I have heard the rival submissions and perused the material available on record. On a consideration of the peculiar facts and circumstances of the case, I find that the Ld. CIT(A) has failed to give any finding whatsoever as to why the explanation of the assessee that half the funds for meeting the cost of investment of ₹ 7. 50 Lacs was financed .....

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siness and this fact has been accepted by the Ld.CIT(A) also. It is a fact that the bank before advancing the loan necessarily has seen the assessee and his wife s capacity to repay back the loan with interest over the years based on their liquidity position and past savings. However the CIT(A) has doubted the fact as to how the concerned lady could have such high savings to the extent claimed. It is presumed by him based on no fact that the drawings and savings necessarily must have been spent .....

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s Indian family to purchase and own at least one residential house during their life time. The emotional decision taken to fulfill this overwhelmingly compelling need of owning at least one family residential house at times is often not a decision based on sound prudent financial planning. Like decisions of Indian families often to rashly overspend on marriages of children as a status symbol to impress the society. The decision to buy a family home are equally emotional decisions driven by famil .....

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s of aspirational India where both spouses are willing to earn and save making sacrifices on a personal level in order to contribute to fulfilling their life s dream of owning a family house. The wife too can be an equal contributer from her own life savings and earnings. In such a scenario, the explanation offered that the wife who admittedly was a taxpayer for over 5 years and as per the consistent explanation before the tax authorities, she accepted and acknowledged that she gave her entire l .....

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