TMI Blog2023 (6) TMI 163X X X X Extracts X X X X X X X X Extracts X X X X ..... eeding except the unsigned ikrarnama we do not see any force in the argument advanced by the ld. DR. DR did not controvert the detailed finding on facts given by the ld. CIT(A) holding that alleged shares were transferred in the subsequent years which were not only disclosed by the assessee in his return of income but due taxes were paid thereon and the same is reiterated before us by the ld. AO in his status report. Thus, we concur the detailed finding of the ld. CIT(A) holding that the transaction for legal transfer of shares actually took place in the subsequent assessment year but not in the year under consideration. Thus addition cannot be sustained merely on assumption and presumption where the evidence clearly supports the contention of the assessee.. There is no tangible material evidence except the unsigned ikrarnama where in itself the details of the cheque payments mentioned are duly recorded. The subsequent transfer of shares duly recorded in the year of transfer and offered for tax, support the finding of the ld. CIT(A). - Decided against revenue. - ITA No. 337/JP/2022, CO No. 26/JP/2022 (Arising out of ITA No. 337/JP/2022) And ITA No. 338/JP/2022, ITA No. 338/ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... identities and creditworthiness of persons involved. 4. Ground 5 The Appellant craves leave or reserves right to amend, modify, alter, add or forego any ground(s) of appeal at any time before or during the hearing of this appeal. 4. In CO No. 26/JP/2022 for A.Y 2020-21, the assessee has taken following grounds of cross objection, which is reproduced here in below: 1 (i) On the facts and in the circumstances of the case CIT(A) has grossly erred on facts and in law in not disposing this issue for making the addition of Rs. 6,21,00,000/- by invoking provisions of section 69 of the I.T. Act, 1961 treating the said amount of Rs. 6,21,00,000/- as unexplained investment and also erred on facts and in law in invoking the provisions of section 115BBE of the Act and charging tax and surcharge etc. accordingly. (ii) On the facts and in the circumstances of the case neither the provisions of section 69 nor the provisions of section 115BBE are applicable. Therefore, the addition made by the ld. AO is bad in law and deserves to be deleted. 2. On the facts and in the circumstances of the case the approval given by the ld. Addl. CIT u/s 153D of the Act is in a very careless man ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on the Samsung Galaxy S10 mobile of Shri Ashok Jain, an Ikrarnama of Rs. 16.00 Crore relating to transfer of shares in Paradizo resort has been retrieved. In the said Ikrarnama, the following Directors have been entered into an agreement of sale on behalf of their company M/s Tongya Resorts Pvt. Ltd. with the purchaser namely 1. Shri Ghanshyam Tak (Alias Shri Ghanshyam Saini) 2. Smt. Lalita Saini (w/o Shri Ghanshyam Saini) 3. Shri Chandra Kant Saini S/o Shri Ghanshyam Saini 4. Shri Gaurav Saini S/o Shri Ghanshyam Saini 5. Smt. Sangeeta Saini w/o Shri Chandra Kant Saini. During the course of search statement was recorded of Shri Ashok Jain one of the Directors. He was specifically asked about the sale of M/s Tongya Resorts Pvt. Ltd. which is run under the name and style of Paradizo resort. In his reply Shri Ashok Jain stated that he had taken a loan of Rs. 3.58 Crore from Sh. Ghanshyam Saini for selling the complete stake in Paradizo resort, however the deal did not matured. The ld. AO has extracted his statement and Ikrarnama in the assessment order. During the course of search proceedings, Shri Chandra Kant Saini, the key person in Saini group of cases had also been confronted ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... account of Shri Anoop Kumar Gupta (i.e. Anoop sir). WhatsApp messages and their meaningful out comes, it has become established that the above referred transfer of payments, were surely occurred in connection with the agreement held on 08.11.2019 between the sellers and the purchasers (whose names have already been mentioned in above paras). Thus, it has got proved beyond doubt that the agreement (Ikrarnama) was actually in existence and was being executed as per the terms and conditions mentioned therein. Further, it has also been proved that the amount of Rs.3,58,00,000/- received by Shri Ashok Jain on different dates through cheques was not a loan taken by him infact, it was an advance payment received on account of transfer of his shares in the name of the above purchasers as per the terms of the agreement. It is also to be worthwhile to mention here that if the value of the shares held by the company would be done in the year 2020-21 as per the balance sheet of the company than the same would be at Rs.3.06 Crores (approx.). Therefore, the difference amount received over and above the value of Rs.3.06 Crores comes at Rs. 12.94 Crores. However, considering the fact that ou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n Paradizo Resort was retrieved from the mobile phone of Sh. Ashok Jain. In the said Ikrarnama, the Directors on behalf of their company M/s Tongya Resorts Pvt. Ltd. entered into an agreement of sale with the purchasers namely Sh. Ghanshyam Tak (alias) Sh. Ghanshyam Saini, Smt. Lalita Saini W/o Sh. Ghanshyam Saini, Sh. Chandra Kant Saini S/o Sh. Ghanshyam Saini, Sh. Gaurav Saini S/ Sh. Ghanshyam Saini and Smt. Sangeeta Saini W/o Sh. Chandra Kant Saini. During the course of search, statement of Sh. Ashok Jain, being one of the directors in the aforesaid company was recorded wherein he stated that he had taken a loan of Rs. 3.58 Crores from Sh. Ghanshyam Saini for selling the complete stake in M/s Tongya Resorts Pvt. Ltd. which is run in the name style of Paradizo Resort, however the deal did not mature. Further during the course of search proceedings, Sh. Chandra Kant Saini, the key person in Saini Group of cases was also confronted on this issue. In his statement, Sh. Chandra Kant Saini stated that he along with his father had extended a loan of Rs. 4.90 Crores to Sh. Ashok Jain in lieu of sale of 60% of shares of Paradizo Resort by Sh. Ashok Jain and he also stated that neither ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2.2020 i.e. prior to the period by which the deal was to be materialized. All the payments mentioned in the agreement are duly recorded in the books of the payer and the recipients. It was further submitted by the Ld.AR that the appellant has sold the shares of Paradizo Resorts held by him and shown the capital gain arose therein in the return of income filed by him and has paid due tax thereon. It was submitted that the complete details of acquisition of shares of Paradizo Resorts and their valuation has been made as per Rule 11UA of the IT Rules. It was further brought to my notice that the appellant was holding 30198 shares out of the total shareholding of 75495 shares of Tongya Resorts Pvt. Ltd. which comes to 40% of the total shareholding. It was contended that till the year ending as on 31.03.2020, there was no sale and transfer of shares by the appellant and that these shares were transferred subsequently in the next year when 7993 shares were sold and the capital gain arose has been duly disclosed in the return of income filed for the AY 2021-22 and due tax has been paid thereon. It was also contended that further 2020 shares were sold on 10.07.2021 and will be disclosed at ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... brought on record to show that the appellant has received an amount of Rs. 6.21 Crores from the purchasers. Infact on perusal of the statement of Sh. Ashok Jain, it is observed that he has stated to have taken a loan of Rs. 3.58 Crores from Sh. Ghanshyam Saini for selling the complete stake in Paradizo Resorts Pvt. Ltd. and stated that the deal did not mature. Further, it is observed that no enquiry was conducted by the AO from the appellant in this regard. The AO has referred to the statement of Sh. Vijay Gupta, brother of the appellant, recorded during the course of search wherein, he too denied of having any knowledge with respect to the aforesaid sale of shares of Paradizo Resorts. Thus the AO has relied upon the unsigned Ikrarnama and whatsapp chats, which have been categorically denied by the aforesaid persons in their statements recorded u/s 132(4) of the Act by stating that the deal did not materialize. I find that if the transaction had taken place in the subject AY, the shares would have been transferred by the appellant to the purchasers. However, nothing in this regard has been brought on record by the AO. (vi) I find that as per the whatsapp chat no. 3, a payment of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 50% of the entire balance amount of Rs. 12.42 Crores in the hands of the appellant is not justified. (vi) Further, it is observed that the Assessing Officer has nowhere recorded the time period of payment of balance amount of Rs. 12,42,00,000/- to the appellant or any of the Directors of M/s Tongya Resorts Pvt. Ltd. but the same was held by the AO to have been received by them against the transfer of shares of the aforesaid property during the current year. However there is no evidence brought on record by the AO to suggest any transfer of shares of the company M/s Tongya Resorts Pvt. Ltd. to the purchasers during the year. Thus there is neither any evidence of receipt of amount of Rs. 12.42 Crores nor any evidence brought on record by the AO for transfer of the shares by the appellant to the purchasers. Therefore, the addition is made by the AO only on the basis of assumption and presumption of payment received by the appellant and the other Director, Sh. Ashok Jain during the year without any incriminating material evidencing the receipt of the amount of Rs. 12,42,00,000/-. There was no material or basis to presume that against the agreement dated 08.11.2019, the appellant rec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and the Ground of Appeal No. 1 is treated as allowed. 8. The ld. DR is heard who relied on the findings of the assessing officer and supported the contention raised by the ld. AO. The ld. DR submitted that as the revenue did not accept the findings of the ld. CIT(A) because the AO was not confronted on the issue. Therefore, carried this matter in this appeal for deleting the addition made. On the ground raised by the revenue two written submission were made dated 13.10.2022 and 31.10.2022 the same is reproduced for the sake of convenience: No. DCIT/CC/AJM/2022-23/620 Date: 13/10/2022 To The Commissioner of Income-tax (DR)-II, ITAT, Jaipur (Through Proper Channel) Sir, Sub- Paper Book in the case of Saini-Gupta-Jain-Malpani-Somani Group of Ajmer, ITA No.334 to 339/JPR/2022 and 356/JPR/2022 for A.Y 2019-20, 2020 21 Ref:- Letter No.CIT(DR)/ITAT/JPR/2022-23/349 dated 03.10.2022- Kindly refer to subject and reference cited. 2. As per reference mentioned (received on 10.10.2022) this office was asked to submit paper book containing copy of seized material etc. by 17.10.2022. 3. The desired paper book is en ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of Ajmer) on 13.02.2020. In the Samsung Galaxy S10 mobile of Sh. Ashok Jain, an Ikrarnama of Rs. 16.00 Crore relating to transfer of shares in Paradizo resort was retrieved. In the said ikrarnama, the following Directors have been entered into an agreement of sale on behalf of their company M/s Tongya Resorts Pvt. Ltd. with the purchaser namely 1. Shri Ghanshyam Tak (Alias Shri Ghanshyam Saini) 2. Smt. Lalita Saini (w/o Shri Ghanshyam Saini) 3. Shri Chandra Kant Saini S/o Shri Ghanshyam Saini 4. Shri Gaurav Saini S/o Shri Ghanshyam Saini 5. Smt. Sangeeta Saini w/o Shri Chandra Kant Saini. During the course statement recorded in search proceedings, Sh. Ashok Jain one of the Director's, was specifically asked about the sale of M/s Tongya Resorts Pvt. Ltd., which is run under the name and style of Paradizo resort. In his reply Sh. Ashok Jain stated that he had taken a loan of Rs.3.58 Crore from Sh. Ghanshyam Saini for selling the complete stake in Paradizo resort, however the deal did not matured. During the course of search proceedings, Sh. Chandra Kant Saini, the key person in Saini Group of Cases had also been confronted with the above transfer of asset as mentioned ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion of WhatsApp messages and their meaningful out comes, it has become established that the above referred transfer of payments, were surely occurred in connection with the agreement held on 08.11.2019 between the sellers and the purchasers (whose names have already been mentioned in above paras). Thus, it has got proved beyond doubt that the agreement (Ikrarnama) was actually in existence and was being executed as per the terms and conditions mentioned therein. Further, it has also been proved that the amount of Rs.3,58,00,000/- received by Shri Ashok Jain on different dates through cheques was not a loan taken by him in fact, it was an advance payment received on account of transfer of his shares in the name of the above purchasers as per the terms of the agreement. Besides, it is also to be worthwhile to mention here that if the value of the shares held by the company would be done in the year 2020-21 as per the balance sheet of the company than the same would be at Rs.3.06 Crores (approx. Therefore, the difference amount received over and above the value of Rs.3.06 Crores comes at Rs.12.94 Crores. However considering the fact that out of total sale consideration of Rs. 16 Cr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ived on 11.12.2019, these appear to be unsecured loans as these were duly accounted for and Sh. Anoop Gupta had paid interest thereon, upon which TDS was also deducted. However subsequently when the shares were sold, this unsecured loan has been consideration of shares sold. adjusted towards the Amount of 3.58 Cr was received by Sh Ashok Jain not by Shri Anoop Gupta. Thus there was no material with the AO to show that the assessee has actually received the amount of Rs. 6.21 crores during the year as the AO has neither been able to justify the addition with any evidence in this regard nor has been able to cull out the time period of the alleged payment whereas on the contrary, the Ld AR of the assessee has been able to bring the facts on record that the alleged shares were transferred in the subsequent years which were not only disclosed by the appellant in his return of income but due taxes were also paid thereon. There was no confirmation regarding cash receipt of Rs 40 lakhs. Thus the transaction for legal transfer of shares actually took place in subsequent AY and not in the subject AY. Once there has been no material with the AO to justify the addition, the addition cann ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o not seen examined/mentioned. Neither any remand report is seen called for from AO in this regard. Ld CIT(A) simply relied upon submission of assessee without verification of facts either herself or through AO as appears from the appeal order. Story of unsecured loan can be an after though which was made by assessee after search. Similarly transfer of shares in books in subsequent AYS that too in two different AY can be the planning of assessee and associates after search. Shri Ashok Jain and Shri Anoop Gupta both were key persons and directors of the sold entity. In books they had 60% and 40% shares respectively. But the same can be different/equal with respect to unaccounted transactions. Since addition is made about the unaccounted transaction, hence AO made addition equally in the hands of both of key persons. It is an admitted fact that so called unsecured loan was never paid back rather adjusted against the sale of shares which proves that it were not unsecured loan rather were advances for sale of shares. Even during the statement during search itself Shri Chandra kant Saini accepted that unsecured loan has been given in order to receive the shares subsequent ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Jain are enclosed. 8.2 On the ground raised by the revenue 2nd written submission were made dated 31.10.2022 the same is reproduced for the sake of convenience: 3. The desired paper book was submitted as per reference no 2 mentioned above to your goodself through proper channel. The same included a brief note (Page 01 to 29) and a pen drive containing copies of relevant exhibits of seized material part of which has been discussed in respective assessment orders (Copies of 8 Pen Drives inventorized as Exhibit-1 to 8 of Annexure-PD found from the residential premises of the Shri Alok Malpani situated at Kishangarh pride, Copies of an Ikrarnama relating to transfer of shares in Paradizo resort relevant whatsapp chats extracted from the mobile phone of Shri Ashok Jain and Copies of relevant digital data obtained from the Mobile Phone of Shri Omanshu Sharma and relevant Annexure-CF in the case of Shri Omanshu Sharma). 9. The ld. AR appearing on behalf of the assessee has filed a detailed paper book wherein he has relied upon the submission made before the ld. CIT(A) which is not re produced to avoid the duplication as it is already forming part of the order of the ld. CIT ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of account of the assessee. Thus, the contention of the revenue is incorrect. In a search conducted on 13.02.2020 this document is recovered having dated 08.11.2019 and the performance was fixed for a future date i.e. 31.07.2020. This deadline was missed on account of corona which has affected the physical movement as restricted by governments and even the time line for submission were also extended PAN India by the supreme court this has affected normal life for almost 2 years. The ld. AR vehemently argued that when the transaction recorded are by an account payee cheque and same is duly found recorded in the books of account and the unpaid balance amount for which neither the performance is due nor the asset in fact transferred cannot be considered as unexplained investment in the hands of the assessee and therefore, detailed finding of the ld. CIT(A) is heavily relied upon by the ld. AR of the assessee and based on these argument he has argued that the appeal of the revenue is not maintainable. 11. The apple of discord or the mute question is based on the ikrarnama found in the search proceeding and amount recorded can be treated as unexplained investment in shares of Tongya ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... #39;ble Bench A/R of assessee submitted that during the year under consideration no shares were sold nor any amount was received by assessee. All the shares were transferred in subsequent years and accordingly capital gain was shown in those years.... AR assured the bench that overall sale price of shares in question would be Rs 16 Cr and his client would be responsible for 40% of 16 Cr in lieu of transfer of his 40% shares. Details submitted by A/R on 07.11.22 has been sent to this office subsequently for verification and comments through Pr. CIT(Central) Rajasthan. Details submitted by A/R on 07.11.22 is seen and noticed that assesse tried to claim that he has transferred 7993 shares in AY 2021-22, 7993 shares in AY 2022-23 and remaining 14212 shares are still with assessee out of total 30198 shares of assessee which are 40% of total shares. In support assessee submitted copies of ITR-V along with computation for AY 2021-22 2022- 23. On 09.11.2022 one another submission has been submitted by assesse in dak in the office of undersigned (copy enclosed). In this submission assessee made similar claims and also gave stated I am undertaking that shares will be transferred in d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 6 crore. In the said ikrarnama it is recorded that a sum of Rs. 3.58 has paid by account payee cheque and the said fact is not disputed before us. It is also not disputed that the deed is unsigned and the performance was fixed for a future date on 31.07.2020. Now the issue that the revenue contended that the shares have already been transferred and therefore the balance amount of Rs. 12.42 crore [ 16 crore less 3.58 already recorded] is unexplained investment and the share of the assessee being 50 % considered as income u/s 69 of the Act for an amount of Rs. 6,21,00,000/-. The ld. AO contended that the transaction is partly accepted by the assessee at the time of survey and story of unsecured loans and transfer of share subsequently developed by the assessee and its associates. The ld. AO through his submission and ld. DR argued that the finding of the ld. CIT(A) is merely based on the evidence produced by the ld. AR of the assessee and it is nothing but afterthought. Not only that the ld. AO has not received an opportunity to substantiate his view on the evidence given by the assessee. He has also raised a question that whether in fact when the ikrarnama found during the search or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ears which were not only disclosed by the assessee in his return of income but due taxes were paid thereon and the same is reiterated before us by the ld. AO in his status report. Thus, we concur the detailed finding of the ld. CIT(A) holding that the transaction for legal transfer of shares actually took place in the subsequent assessment year but not in the year under consideration. There is no tangible material evidence except the unsigned ikrarnama where in itself the details of the cheque payments mentioned are duly recorded. The subsequent transfer of shares duly recorded in the year of transfer and offered for tax, support the finding of the ld. CIT(A). In the light of the facts and circumstances, we are of the view that the addition cannot be sustained merely on assumption and presumption where the evidence clearly supports the contention of the assessee. Thus, we do not find any infirmity in the detailed finding of the ld. CIT(A) and we see no merit in the ground raised by the revenue in this appeal and ground no. 2 raised by the revenue is dismissed. 13. The ground no. 1, 3 4 being general in nature and there is no specific submission and/or arguments advanced before ..... X X X X Extracts X X X X X X X X Extracts X X X X
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