TMI Blog2018 (7) TMI 45X X X X Extracts X X X X X X X X Extracts X X X X ..... It is well settled principle of law that mentioning of a wrong provision or non-mentioning of provision does not invalidate the addition. See case of “Action for Welfare and Awakening Rural Environment vs. DCIT [2003 (3) TMI 49 - ANDHRA PRADESH HIGH COURT]. In this case all that the AO did, was to hold that this receipt cannot be taxed under the head “Capital Gains” but was to be taxed under the head other sources as unexplained income. The assessee had claimed that it had received an amount of ₹ 7,50,000/- on sale of capital asset and thereafter could not substantiate the same. - Decided against assessee. - I.T.A No. 99/Kol/2018 - - - Dated:- 27-6-2018 - Hon ble Shri J.Sudhakar Reddy, AM For the Appellant : Shri Ankit Jal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on, this transaction in question was not offered to tax during the assessment year 2007-08. It was claimed that the property was purchased by the assessee on 08.08.1994 at the cost of ₹ 1,73,430/- and thereafter sold on 08.10.2006 for the sale prices of ₹ 7,50,000/-. After considering the index cost of the property as ₹ 3,75,530/- long term capital gain of ₹ 4,02,470/- was stated to have been earned. It was further submitted that during the assessment year 2006-07 there is a business loss and above capital gains could be adjusted against that loss. The Ld. CIT(A) called for the remand report. The assessing officer on the ground that the assessee had changed the capital gains for ₹ 2,73,905 to ₹ 4,02,479/- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s of the assessee, she submitted that the assessee is a trader and has been maintaining books of accounts and if this amount is an unaccounted receipt, it can be added as unaccounted income under section 68 of the Act. She submitted that quoting a wrong section is not fatal to the assessment of undisclosed income. On the year of taxability, she submitted that the assessee had offered this amount to tax this year and hence he cannot plead otherwise. 7. In reply the ld. Counsel for the assessee submitted that the assessee had actually earned capital gains in the earlier assessment year 2007-08 and instead of offering the same to tax in that year, has, honestly declared the long term capital gain in this year and is being penalized for doin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 00/- of the asset reduced by indexed cost of acquisition of such asset for ₹ 4,76,095/-. During the assessment proceedings, the assessee was asked to submit documentary evidence of the purchase and sale of the Immovable property, name and address to whom the property had been sold and the address of the Registry Office where the property got registered. . 2. But the assessee failed to submit such documents. As a result the AO had no other alternative but to treat the sale proceeds of ₹ 7,50,000/- as unexplained cash credit u/s 68 and add to the total Income of the assessee under the head Income from other sources . 3. In the letter of the assessee addressed to you, the assessee fabricated a story that the capital ga ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the sum is not credited In the books of accounts of the appellant during the year. Therefore, the sine qua non condition for the applicability of section 68 is not satisfied and hence, the addition is void and should not be sustained. Further we would like to submit that the appellant had produced all the evidence supporting the claim of the Long term Capital Gain and also the set off from the loss of the previous year. The Ld. A.O. in his remand report has not found any Infirmity in the documents submitted by the appellant. However, the Ld. A.O. concluded that the appellant has made up story. It shall not be out of place to mention that, the appellant had produced necessary documents to support its contention. Therefore, the finding ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gain disclosed in the return of income during this year, is nothing but the long term capital gain that arose to the assessee on the sale of a plot of land at Jaipur during the financial year 2006-07 relevant to assessment year 2007-08. 11. Coming to the plea that the addition cannot be made u/s 68 of the Act, as this amount entered into books of accounts, I hold that the receipt in question is taxable as undisclosed income as pleaded by the ld. DR. It is well settled principle of law that mentioning of a wrong provision or non-mentioning of provision does not invalidate the addition. For this proposition, we draw strength from the judgment of Andhra Pradesh High Court in the case of Action for Welfare and Awakening Rural Environment vs ..... X X X X Extracts X X X X X X X X Extracts X X X X
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