TMI Blog2018 (6) TMI 1117X X X X Extracts X X X X X X X X Extracts X X X X ..... d of the assessee. This compensation received has been held by the Ld. CIT(A) as capital in nature - Compensation has been received by the assessee for laying underground pipe by the GAIL, thus, respectfully following the above finding of the Tribunal in case of Jagan Nath Prasad, HUF [2015 (10) TMI 240 - ITAT DELHI] we uphold the finding of the Ld. CIT(A) on the issue in dispute. Accordingly, the ground of the appeal of the Revenue is dismissed. - ITA No.3384/Del/2015 - - - Dated:- 20-6-2018 - SH. H.S. SIDHU, JUDICIAL MEMBER AND SH. O.P. KANT, ACCOUNTANT MEMBER For The Appellant : Sh. Atiq Ahmed, Sr.DR For The Respondent : Sh. Kapil Goel, Adv. ORDER PER O.P. KANT, A.M.: This appeal by the Revenue is directed against order dated 30/03/2015 passed by the Ld. Commissioner of Income-tax (Appeals)-1, Gurgaon [in short the Ld. CIT(A) ] for assessment year 2010-11, raising following grounds: 1. On the facts and circumstances of the case, the Ld. CIT(A) has erred in fact and in law in deleting the addition of ₹ 64,00,000/- on account of unexplained cash deposited in bank account, although the cash flow statement was not reliable. 2. On ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ngs and, therefore, prevented by sufficient cause in producing those evidences before the Assessing Officer. The Ld. CIT(A) forwarded those additional evidences to the Assessing Officer. The Assessing Officer in the remand report dated 12/03/2015 objected the admissibility of the additional evidences. The Ld. CIT(A), however, admitted the additional evidences and after considering submission of the assessee allowed the appeal partly. 2.2 Aggrieved with the order of the Ld. CIT(A), the Revenue is in appeal before the Tribunal, raising the grounds as reproduced above. 3. In ground No. 1 and 2 of the appeal, the Revenue has challenged addition of ₹ 64,00,000/- deleted by the Ld. CIT(A), which was made by this Assessing Officer on account of unexplained cash deposited in the bank account. 3.1 Before us, the Ld. DR submitted that the Ld. CIT(A) has violated the conditions of Rule 46A(3) of the Income Tax Rules, 1962 (in short the Rules ) and according to which, after admitting the additional evidences, the Assessing Officer should have been allowed opportunity to examine and rebut those evidences. According to him, the issue in dispute should be restored to the fil ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... deed of land in village Jakobpura, Gurgaon for reconciling the difference in cash-in-hand reported in cash flow statement as well as in balance sheet. After considering the explanation of the assessee, the Ld. CIT(A) deleted the addition. The relevant finding of the Ld. CIT(A) on the issue in dispute is reproduced as under: 5.3 I have considered the facts of the case and gone through the submissions of the appellant together with the remand report of the A.O. The A.O, in the first instance made the addition of ₹ 64 Lakhs to the income of the appellant on account of the fact that cash deposits in appellant's bank account could not be explained by him. No details could be filed by the appellant explaining the source of aforesaid cash deposits as a result of which the A.O had no alternative but to make the addition of ₹ 64 Lakhs to the income of the appellant on account of unexplained cash deposits. 5.4 The appellant, however, during the course of appellate proceedings gave additional evidence which included cash flow statement, statement of cash transaction in J K bank and the bank statement. In addition to these documents, the appellant also drew my atte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... alance of ₹ 52,66,131/-, withdrew ₹ 71,00,000/- in cash from his bank account. This is corroborated by the bank statement given by the appellant of J K Bank for the period 01.04.2009 to 31.03.2010. Thus the total cash available to the appellant during the year period was ₹ 1,23,66,131/-. Out of the said cash balance, the appellant re-deposited cash by ₹ 64,21,000/- in his bank. Apart from this there were certain other utilization of cash available by the appellant during the year. After considering all these transactions the appellant was left with a closing balance of ₹ 20,05,524/- as on 31.03.2010.Considering the facts of the case and failure of the AO to give any evidence that the cash deposited was not sourced from aforesaid cash withdrawals, it follows that appellant's explanation regarding cash deposits is on a sound footing and thus deserves to be accepted. 5.6 The A.O in his remand report has recommended that the addition made by the A.O may be sustained on account of the fact that while the closing cash balance as per appellant's cash statement was ₹ 20,05,524/-, the balance sheet figure for cash in hand was ₹ 52,26,0 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... an amount of ₹ 29,59,000/- was paid in cash. The appellant, by mistake, failed to reduce this amount of cash along with some minor entries in its cash balance figure prepared for balance sheet. Once, these figures are subtracted, the cash balance as per the balance sheet filed by the appellant exactly matches with the cash balance figure given by the appellant during the course of appellate proceedings. Once, the two figures are reconciled, there is no force in A.O's contention that the addition of ₹ 64,00,000/- made on account of unexplained cash deposits be sustained on the basis of this discrepancy. 5.8 Hence after a careful consideration of the facts of the case and in light of the discussion made in this order based on various documents filed by the appellant during the course of appellate proceedings, I hold that the source of ₹ 64,00,000/- deposited in cash in the appellant's bank account is satisfactorily explained. Hence there is no basis for making any addition of this ground. Accordingly, Ground No. 2 of the appeal is allowed. 3.4 On perusal of the above finding of the Ld. CIT(A), it is evident that the submission of the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing Officer holding the compensation received from GAIL as Revenue receipt. 4.1 Before us, the Ld. DR submitted that before the Assessing Officer the assessee did not file any justification for claiming the said amount as exempt income. According to him, the amount in question is revenue in nature and, therefore, the Assessing Officer is correct in holding the same. 4.2 The Ld. counsel of the assessee, on the other hand, relied on the decision of the Tribunal dated 05/08/2015 in the case of Jagannath Prasad and Sons HUF in ITA No. 676/Del/2015 for assessment year 2010-11, wherein also, the compensation received from the GAIL for laying underground pipeline in agricultural land was held as capital in nature. Accordingly, he submitted that the finding of the Ld. CIT(A) might be upheld. 4.3 We have heard the rival submission and perused the relevant material on record. We note that the amount in question has been received by the assessee from the Gas Authority of India Ltd. (GAIL) by way of compensation to lay underground pipe in the agricultural land of the assessee. This compensation received has been held by the Ld. CIT(A) as capital in nature, observing as under: ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he assessee was damaged by Sahara India and in fact after paying compensation, neither Sahara India nor the Municipal Council have restored the land belonging to the assessee to its original position. The fact that Sahara India has removed the equipments from the plot belonging to the assessee, it cannot be said that the damage caused to the land has been set right by restoring the land to its original position. In these circumstances, in our opinion, the amount of ₹ 8,42,000/- received by the assessee towards the damage to the land belonging to the assessee cannot be said to be revenue receipt. The fact that the land has remained with the assessee and that the assessee in future may earn profits from the said land cannot be a ground to hold that the compensation received by the assessee in lieu of damage caused to the land was revenue receipt. Accordingly, we answer the question in favour of the assessee and against the revenue. 10. So, respectfully following the ratio laid down in the aforesaid referred to case, the impugned addition sustained by the Id. CIT(A) is deleted because the amount received towards the damage to the land belonging to the assessee cannot be ..... X X X X Extracts X X X X X X X X Extracts X X X X
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