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TMI Blog2023 (3) TMI 351X X X X Extracts X X X X X X X X Extracts X X X X ..... om the assessee nor was any return of income filed. Subsequently, reasons for income having escaped assessment were recorded after taking approval from the Ld. Pr. CIT, Karnal and notice under section 148 was issued to the assessee. In response, the assessee filed his return of income and thereafter notices under section 143(2) and 142(1) were issued and necessary information was called for and examined by the AO. As per the AO, out of total cash deposit of Rs. 1,02,20,000/-, the assessee could only explain an amount of Rs. 52,14,270/- and balance amount of Rs. 50,05,730/- remained unexplained which was brought to tax in the hands of the assessee, and as against the returned income of Rs. 1,34,013/-, the assessed income was determined at Rs. 51,39,743/- vide order passed under section 147 read with 143(3) dt. 15/12/2017. 3. During the course of assessment proceedings, the assessee was directed to provide the explanation regarding the nature and source of cash deposited in his bank account. In his submission, the assessee submitted that the cash so deposited pertains to proceeds of sale of the property, cash received on account of sale proceeds of the agricultural produce as well a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... got registered at the collector rate of Rs. 42,53,000/-. The assessee is an illiterate and he has no motive to get the sale deed of land registered at lower price than the market rate because the land sold was an agricultural land not being a capital asset and no capital gain arises on the transfer of this agricultural land within the meaning of IT Act. The assessee filed copy of agreement to sell with Smt. Bohati Devi which clearly shows that the sale consideration comes to Rs. 82,65,500/- and not Rs. 42,53,000/-. The amount was deposited on the same day when the sale deed was got registered. The assessee also requested for summoning of Smt. Bohati Devi. Smt. Bohati Devi was summoned by the AO and her statement was recorded. Smt. Bohati Devi although pretended to be uneducated but was well trained. In reply to a question whether she is known to Sh. Jagir Singh the assessee, she denied that she did not know Sh. Jagir Singh although she has purchased agricultural land from him. To all other questions, she denied of any knowledge on the ground that these were known to her father-in-law who has since expired. She did not deny the agreement but to all other questions, she gave a stere ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... submitted that during the course of reassessment proceedings, it was duly explained before the AO that the major amount of cash deposit is with regard to the amount received from sale of the property. The agreement to sell as executed with Smt. Bohati Devi was duly filed before the AO alongwith copy of the sale deed duly executed between the assessee and Smt. Bohati Devi. It was also explained to the AO that there are cash withdrawals earlier made from the bank accounts and which are re-deposited during the year. However, the reply of the assessee was not considered by the AO and also not properly appreciated by the Ld. CIT(A). Hence the addition has been confirmed in the hands of the assessee. 8. Further our reference was drawn to the statement of cash flow prepared on behalf of the assessee and the contents thereof read as under : Date Dr Cr Balance Source in case of Dr Use in case of Cr 10.04.2009 136580 136580 Agricultural Income (Admitted by AO) 12.04.2009 82808 219388 Agricultural Income (Admitted by AO) 15.04.2009 2055400 2274788 Agreement (Pb-Pg-2) 07.07.2009 6209600 8484388 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... never denied that the thumb impression on the sale agreement do not belong to her. It was accordingly submitted that the AO was not correct in stating that Smt. Bohati Devi did not confirm the claim of the assessee. She has duly agreed that she has entered into a transaction of the property through her Father in Law and the AO could have made further enquiry by calling her husband Shri Raj Kumar who was physically present at the time of execution of final sale deed but he choose not to call him for reasons best known to him. In support, reliance was placed on the Jaipur Benches decision in case of Shri Pappu Ram Saran vs. ITO (in ITA No. 1303/JP/2018 dated 03/09/2020) besides various other decisions. 10. It was further submitted that other sources of cash deposits were the advance received against sale of another land amounting to Rs. 7 lacs which was also refunded back to the buyer during the year, agriculture income and cash withdrawal from the bank account. It was submitted that the AO has not accept the withdrawal from the HDFC Bank by stating that the said withdrawal are not cash withdrawals and only an FDR was made by the Bank. In this regard our reference was drawn to the c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he year. As per the AO, out of total cash deposits of Rs. 1,02,20,000/-, the assessee could only explain an amount of Rs. 52,14,270/- and balance amount of Rs. 50,05,730/- remained unexplained which was brought to tax in the hands of the assessee. The AO has accepted the explanation regarding receipts from agriculture operations, partially accepted the explanation regarding nature and source of receipts in cash being the sale proceeds from the sale of the agriculture land to the extent of sale consideration as per registered sale deed and not as per agreement to sell, and the remaining explanation regarding other sources of deposits was not accepted at all. 14. Firstly, regarding receipts from sale of agricultural land, the assessee has explained that he has received a sum of Rs. 82,65,000/- from Smt. Bhopati Devi and which has been deposited in his bank account. In order to support his explanation, he has submitted a copy of agreement to sell dated 15/04/2009, copy of registered sale deed dated 07/07/2009 and copy of the bank account maintained with HDFC bank where the sale proceeds were deposited. It was further submitted that he had received a sum of Rs. 20,55,400/- at the time ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssee showing his inability to get the buyer appear before the AO, the summons were issued u/s. 131 and statement of buyer Smt. Bhopati Devi was recorded. 18. On perusal of statement of Smt. Bhopati Devi so recorded u/s. 131, we find that Smt. Bhopati Devi has stated in response to question No. 4 that she is aware that the sale transaction for sale of agriculture land has been entered into in her name with Jagir Singh and in response to further question No. 5 and 6, she has stated that she is not aware of exact amount of sale consideration as the sale transaction was undertaken by her father-in-law on her behalf. Therefore, what emerges from her statement is that she was very much aware of sale transaction having being undertaken on her behalf with Jagir Singh however the value at which the transaction was executed and total sale consideration was not in her knowledge as the whole transaction was undertaken by her father-in-law. Given the fact that Smt. Bhopati Devi's father-in-law had expired, even no further examination of any other person including the husband of Smt. Bhopati Devi or any other witnesses was carried by the Assessing officer. We therefore find that the stateme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing in the sale deed alias name of the assessee. The AO has also not disputed the fact that the assessee is one of the joint owners of the land which was sold vide sale deed 08.04.2009. We further note that the cash of Rs. 27,50,000/- was deposited in the bank account of the assessee with Oriental Bank of Commerce, Kishangarh on 09.04.2009. The date of cash deposit is subsequent to the date of sale deed dated 08.04.2009 which prima facie shows that the source of cash deposit has a direct nexus with the sale transaction of the land sold by the assessee jointly with other co-owners vide sale deed dated 08.04.2009. Though the sale deed shows the sale consideration of Rs. 6,45,000/- which is also the Stamp Duty Valuation however, once the assessee has brought on record the relevant facts as well as nexus between transaction of sale and deposit in bank account then only inference can be drawn from these facts and circumstances of the case is that the source of deposit of Rs. 27,50,000/- is the sale consideration of the land. The Assessing Officer has not brought anything contrary on the record during the remand proceedings such as examination of the purchaser. Therefore, in the absence ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lharam Meena 1007813 1,50,000/- 10,00,000/- 1,60,000/- 14/05/2005 12/08/2005 16/08/2005 Do 3. Sh. Ballu Ram Meena 1007108 4,00,000/- 11,70,666/- 14/05/2005 12/08/2005 Do 4. Sh. Harphool Meena 1004534 11,70,667/- 12/08/2005 Do 5. Sh. Satendra Basanwal 1007978 14,00,000/- 12/08/2005 Son of Sh. Bagwataram Seller 6. Sh. Rajendra Kumar Meena 1003946 1,50,000/- 14,00,000/- 12/05/2005 12/08/2005 Do 7. Sh. Om Prakash Meena 1004337 1,50,000/- 14,00,000/- 12/05/2005 12/08/2005 Do 8. Sh. Ashok Kumar Meena 1001168 14,00,000/- 12/08/2005 Do 9. Sh. Rosha/ La/ Meena 1006877 1,50,000/- 14,00,000/- 12/05/2005 12/08/2005 Grandson of Sh Bagwataram, Seller 10. Sh. Jagdish Pd. Meena 100131 7,50,000/- 12/08/2005 Son of Smt. Dhapu Devi Meena, Seller 11. Sh. Manna Lai Meena 1008064 7,15,800/- 12/08/2005 Son of Smt. Dhapu Devi Meena, Seller 12. Sh. Nemi Chand Meena 1005293 7,50,000/- 12/08/2005 Son of Smt. Dhapu Devi Meena, Seller 13. Smt. Sushila Meena W/o Prabhu Dayal Meena 210501000 07726 7,50,000/- 12/08/2005 W/o- Sh. Prabhu Dayal Meena, S/o- Smt. Dhapu Devi Meena, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee cannot be rejected. Hence, the addition sustained by the Ld. CIT(A) is deleted." 20. In the instant case, we find that there was deposit of cash of Rs. 79,00,000/- on 07/07/2009 the very same day on which the sale deed was executed and Rs. 2,00,000/- was deposited on the next day, therefore a clear nexus has been established between source of such cash deposit and sale transaction so executed by the assessee. In absence of any contrary evidence brought on record in terms of statement of witnesses and comparative sale data of similar transaction undertaken at same/nearby location at a value different from what has been claimed by the assessee, the explanation so furnished by the assessee cannot be disputed. We are conscious of the fact that though the sale deed shows lower sale consideration of Rs. 42,53,000/- which is also the Stamp Duty Valuation however, once the assessee has brought on record the relevant facts and documentation as well as nexus between transaction of sale and deposit in bank account has been established then in absence of any contrary evidence brought on record, only inference which can be drawn from these facts and circumstances of the case is that t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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