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TMI Blog2025 (2) TMI 282X X X X Extracts X X X X X X X X Extracts X X X X ..... l on or before the hearing of hearing." 3. Succinctly, the factual panorama of the case is that assessee before us is an Individual and has not filed his return of income for the year under consideration in due course. As per the information and details available on record with the Department, it was noticed by the assessing officer that the appellant assessee had made considerable transactions for purchase of property of Rs. 2,97,63,459/- at Mumbai, having tax and revenue implications, however, the appellant did not disclose the said transactions by filing return of income within the stipulated time limit provided u/s 139 of the Act. Therefore, the assessing officer after following due process u/s 148A of the Act and recording reasons, notices u/s 148 of the Act was issued and served upon the appellant. In response thereof, the appellant assessee filed return of income declaring the total income at Rs. 480/-. The assessing officer issued the draft assessment order dated 24.03.2023 u/s 144C of the Act by making an addition of Rs. 2,97,63,459/-, on account of unexplained investment in purchase of immovable property u/s 69 of the Act and proposing assessment of total income at Rs. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in further appeal before us. 5. Shri Bharat Kumar, Learned Counsel for the assessee, submitted the paper book, before the Bench, containing pages 1 to 243 and stated that assessee under consideration is a non-resident and who purchased immovable property in India on 25.02.2010, vide allotment letter issued by the Oberoi Realty Ltd, for a consideration of Rs. 2,24,76,000/-, and a substantial amount was paid by the assessee at the time of allotment. However, sale agreement was made on 14.11.2017 by Oberoi Realty Ltd. Since the transaction was concluded in the assessment year 2010-11, therefore, the addition should not be made in the assessment year 2018-19. During the assessment proceedings and during the DRP proceedings, the assessee furnished copy of income tax return for assessment year 2018-19, copy of income tax return for assessment year 2017-18, copy of allotment letter issued on 25.02.2010, copy of agreement to sale on 14.11.2017, copy of return of income filed for assessment year 2020-21, copy of return of income filed for assessment year 2017-18 in case of Chetna Chandrakant Mehta, bank statement of wife of the assessee and bank statement of Chetana Chandrakant Mehta, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lal (PB-160) (9). Return of Income filed with Inland Revenue Department for the period 2017-18 of Chetna Chandrakant Mehta (PB-161) (10). Incorporation of Company in Hongkong Kilman Trading Limited and invoice (PB- 163-164) (11). Copy of Bank Statement of assessee's wife Chetna Chandrakant Mehta NRI Account No. 087010100295956 for the period 01/01/2010 to 31-12-2010 (PB-165- 166) (12). Copy of Bank Statement of assessee's wife Chetna Chandrakant Mehta NRI Account No. 087010100295956 for the period 01/01/2011 to 31-12-2011 (PB-167- 169) (13). Copy of Bank Statement of assessee's wife Chetna Chandrakant Mehta NRI Account No. 087010100295956 for the period 01/01/2012 to 31-12-2012 (PB-170- 171) (14). Copy of Bank Statement of assessee's wife Chetna Chandrakant Mehta NRI Account No. 087010100295956 for the period 01/01/2013 to 31-12-2013 (PB-172- 173) (15). Copy of Bank Statement of assessee's wife Chetna Chandrakant Mehta NRI Account No. 087010100295956 for the period 01/01/2014 to 31-12-2014 (PB-174- 176) (16). Copy of Bank Statement of assessee's wife Chetna Chandrakant Mehta NRI Account No. 087010100295956 for the period 01/01/2015 to 31-12-2015 (PB-177- 179 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er A of the said residential building "Oberoi Exquisite - 1, have approached and requested us for allotment of the same in your favour. 3. As desired by you, and pursuant to your request, we hereby inform you that we are agreeable to allot to you a flat admcasuring 100.43 square metres (carpet area) approximately equivalent to 1081 square feet (carpet area) approximately equivalent to 123.12 square metres (usable area) approximately equivalent to 1325.27 square feet (usable area) approximately equivalent to 169.08 square metres (saleable area) approximately equivalent to 1820 square feet (saleable area) bearing no. 1802 on 18th floor in Tower "A" proposed to be constructed on the Said Property (hereinafter referred to as the "Said Premises"), subject to approval of the plans and amendments thereof for construction of the building, Oberoi Exquisite - 1, from time to time, being sanctioned by the Municipal Corporation of Greater Mumbai ("MCGM"), and subject to the terms and conditions contained herein. We are also agreeable to grant to you irrevocable permission and right to park your vehicle's in 2 (Two) Single car parking space/s in the building, Oberoi Exquisite - I. The car ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nor the DRP has considered these documents and evidences submitted by the assessee, in right perspective. During the DRP proceedings, a report was sought from the assessing officer and we find that assessing officer, did not give any adverse comments in respect of the documents and evidences submitted by the assessee. During the DRP proceedings, it was assessee's contention that all the payments were made from the account of assessee`s wife as it is a joint property purchased in the name of the assessee and his wife. The assessee has produced the bank statement of Chentna Chandrakant Mehta and that being an NRI account, and the credits appearing in the bank account has also been properly explained by the assessee. Despite of this, the assessing officer did not accept the explanation of the assessee. We note that the assessee has submitted a plethora of documents and evidences, before the assessing officer, which we have reproduced in para number eight of this order. We note that neither the assessing officer nor the DRP, has refuted or discredited these evidences and documents. The assessing officer and ld DRP, do not mention why they are not accepting these evidences. On the cont ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... le or not is still to be decided with reference to the provisions of s. 5(2) and, the provisions of s. 68 or 69 cannot enlarge the scope of s. 5(2). What is not taxable under s. 5(2) cannot be taxed under the provisions of s. 68 or s. 69. Under s. 5(2), the income accruing or arising outside India is not taxable unless it is received in India. Similarly, if any income is already received outside India, the same cannot be taxed in India merely on the ground that it is brought in India by way of remittances. Reference can be made to the judgment of Supreme Court in the case of Keshau Mills Ltd. (supra). If such income is shown in the books of account then it cannot be taxed in India merely because the assessee is unable to prove the source of such entry. For example, there may be appearing an entry of cash credit in the name of a person of USA by way of loan received through cheque and deposited in the bank account maintained at any city in USA. Such money, being received outside India, cannot be taxed under s. 5(2) unless it is proved that such money is relatable to the income accrued or arising in India. Therefore, the same cannot be taxed under s. 68 merely on the ground that asse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on the decisions of the Tribunal in the cases of Finlay Corporation Ltd. (supra), Smt. Susila Ramasamy (supra) and Saraswati Holding Corpn. Inc. (supra) and the import of CBDT circular referred to above. Whenever remittances are made by the non- resident holding company for purchase of shares of its subsidiary in India, the money undoubtedly is capital in the nature and if documents like FIRC etc. are produced, it can safely be stated that the said money came in through banking channels. 11.6 In the absence of any evidence to show that the money remitted by the non-resident accrued in India, it cannot be held to be taxable in India. Hence, moneys remitted by non-residents whose identity is not in question through their bank accounts outside India have to be held as capital receipts not exigible to tax. It therefore naturally follows that if the identity of the non-resident remitter is established and the money has come in through banking channels, it would constitute a capital receipt and ordinarily cannot be treated as deemed income under s. 68 or 69 of the Act. This is clarified by the CBDT circular itself. 11.7 Taking into consideration of all the above, we find merit in t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is still to be decided with reference to the provisions of section 5(2) and the provisions of section 68 or 69 cannot enlarge the scope of section 5(2). What is not taxable under section 5(2) cannot be taxed under the provisions of section 68 or 69. Undersection 5(2), the income accruing or arising outside India is not taxable unless it is received in India. Similarly, if any income is already received outside India, the same cannot be taxed in India merely on the ground that it is brought in India by way of remittances. If such income is shown in the books of account then it cannot be taxed in India merely because the assessee is unable to prove the source of such entry. Therefore, the same cannot be taxed under section 68 merely on the ground that the assessee fails to prove the genuineness and source of such cash credit. Therefore, the provisions of section 68 or 69 would be applicable in the case of non-resident only with reference to those amounts whose origin of source can be located in India. Therefore, the provisions of section 68 or 69 have limited application in the case of anon-resident. [Para 13]" 15. Further, our view is fortified by the decision of the Coordinate Be ..... X X X X Extracts X X X X X X X X Extracts X X X X
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