TMI Blog2019 (4) TMI 1365X X X X Extracts X X X X X X X X Extracts X X X X ..... E-TAX. VERSUS JANAK RAJ CHAUHAN. [ 2005 (8) TMI 284 - ITAT AMRITSAR] - Decided in favour of assessee. - ITA No.212/Asr./2018 - - - Dated:- 17-1-2019 - Sh. N. K. Saini, Vice President And Sh. Ravish Sood, Judicial Member For The Assessee : Sh. Ashray Sarna, CA For The Revenue : Sh. Bhawani Shankar, DR ORDER Per N. K. Saini, Vice President: This is an appeal by the assessee against the order dated 01.02.2018 of ld. CIT(A)-1, Jalandhar. 2. Following grounds have been raised in this appeal: 1. That having regard to the facts and circumstances of the case, Hon ble CIT(A) has erred in law and on facts in confirming the action of Ld. AO in framing the impugned assessment order u/s 143(3)/147 and without complying with the mandatory conditions u/s 147 as envisaged under the Income Tax Act, 1961. 2. That having regard to the facts and circumstances of the case, Hon ble CIT(A) has erred in law and on facts in confirming the action of Ld. AO in making addition of ₹ 46,50,000/- without considering the submissions of the asse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... known that a Power of Attorney only authorized its holder to deal with the property as per the wishes of the principal/owner, laid out in attorney executed and the attorney holder does not become the owner of the property, by virtue of the attorney executed in his favour. The reliance was placed on the decision of the ITAT Amritsar Bench in the case of ACIT Vs Janak Raj Chauhan reported at (2006) 102 TTJ 0297. The assessee also furnished the written submission which has been incorporated by the ld. CIT(A) in para 4 of the impugned order, for the cost of repetition, the same is not reproduced herein. 6. The ld. CIT(A) summarized the submissions of the assessee at page no. 14 of the impugned order as under: 1. There is no dispute with regard to the fact that, Smt. Harsharan Kaur is the recorded owner of the land in question. 2. There is also no dispute with regard to the fact that, there is no evidence on record suggesting that any consideration has been paid by the assesse to Smt. Harsharan Kaur for executing power of attorney in favour of the assessee. 3. There is also no evidence on record that any cons ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ails provided by the Ld. Counsel the land is shown in the name of Smt. Harsharan Kaur. But, the subsequent sale of the plot being made by the assessee shows that he is using and appropriating the property as its own, so much he is further selling the same. The assessing officer has involved provisions of Sec. 56(2)(vii)(b) of the Income Tax Act 1961 and made addition of ₹ 46,50,000/-. The assessee has failed to bring on record, the actual investment made by him to acquire the general power of attorney of the property. Therefore, assessment of an amount of ₹ 46,50,000/- U/s Sec. 56(2)(vii)(b) of the Income Tax Act made by the assessing officer is upheld. Ground of appeal No. 2 is dismissed. 9. Now the assessee is in appeal. The ld. Counsel for the assessee reiterated the submissions made before the authorities below and further submitted that Smt. Harsharan Kaur was 73 years old lady at the relevant time. Therefore, she gave Power of Attorney to the assessee since she could not maintain the property. It was further submitted that within one year from the date of general Power of Attorney, the assessee gave the attorney to Sh. Deepak Pal Singh on 07.01.2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... im (see section 1A and section 2 of the Powers of Attorney Act, 1882). It is revocable: or terminable at any time unless it is made irrevocable in a manner known to law. Even an irrevocable attorney does not have the effect of transferring title to the grantee. In State of Rajasthan V/s. Basant Nehata - 2005 (12) SCC 77, this Court held : A grant of power of attorney is essentially governed by Chapter X of the Contract Act. By reason of a deed of power of attorney, an agent is formally appointed to act for the principal in one transaction or a series of transactions or to manage the affairs of the principal generally conferring necessary authority upon another person. A deed of power of attorney is executed by the principal in favour of the agent. The agent derives a right to use his name and all acts, deeds and things done by him and subject to the limitations contained in the said deed, the same shall be read as if done by the donor. A power of attorney is, as is well known, a document of convenience. Execution of a power of attorney in terms of the provisions of the Contract Act as also the Powers-of-Attorney Act is valid. A power of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts, we are of the view that the CIT(A) was justified in deleting the addition. The POA would not give right to the assessee in his individual capacity to acquire any right, title or interest in the property unless the facts are brought on record that POA was subject to consideration. The AO has not brought any evidence on record to justify his estimate of income. Mere recovery of POA from the possession of the assessee is not enough to estimate income against the assessee. The law is clear that POA is meant for doing the certain acts on behalf of the principal. It is also subject-matter of cancellation. Only certain acts which have been authorised by the POA could be exercised. Therefore, the AO was not justified in drawing adverse inference against the assessee that on the basis of recovery of POA the assessee earned the income. There is no merit in the appeal of the Revenue. The same is accordingly dismissed on this ground. 15. So, respectfully following the aforesaid referred to order, the impugned addition made by the AO and sustained by the ld. CIT(A) is deleted. 16. In the result, the appeal of the assessee is allowed. ( ..... X X X X Extracts X X X X X X X X Extracts X X X X
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