TMI Blog1994 (3) TMI 124X X X X Extracts X X X X X X X X Extracts X X X X ..... nder s. 154 of the Act which we were informed that it was not disposed of by the ITO. The assessment was completed on a total income of Rs. 13,81,130 which included a sum of Rs. 12,50,000 as unexplained investment in agricultural land, Rs. 1,00,000 estimated expenses in connection with the purchase of the agricultural land and Rs. 12,000 as income from undisclosed sources. Before making the assessment, the AO recorded oath statement of the assessee on 22nd March, 1989 and the replies given were very unsatisfactory and evasive so much so that the assessee did not even know the exact expenditure of the agricultural land purchased. He pleaded ignorance on many aspects relating to the purchase of agricultural land and answered that his brother Shri Devilal G. Shah could throw more light in this regard. It was contended before the AO that the purchase price of the agricultural land was made from out of withdrawal from the partnership firm of M/s Vimla Prints in which the assessee was a partner and account copy of the assessee in the said firm was also filed during the course of assessment proceedings. According to the AO, the assessee was benamidar of his brother Shri Devilal G. Shah, w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... authorised representative submitted that the AO made the addition on mere suspicion that the assessee paid more money than recorded in the sale deed dt. 22nd March, 1985 and not on the basis of any cogent and reliable evidence. He took us through the contents of the assessment order to support this submission. According to the assessee's counsel, therefore, the addition of Rs. 12,50,000 as unexplained investment has been made merely on suspicion, conjectures and surmises and the CIT(A) should have deleted the entire addition and not a fraction of the addition. It was also highlighted by the assessee's counsel that according to the AO, the assessee was a benamidar and the real owner in respect of agricultural land was his brother Shri Devilal G. Shah and that being the case, no addition was warranted in the assessee's hands towards unexplained investment. To support this argument, our attention was invited to the finding/observation of the AO in the assessment order for the year under appeal which was passed on 29th March, 1990 and the assessment order of the assessee for the asst. yr. 1987-88 which was passed on 28th March, 1990 which is found at pages 72/73 of the assessee's paper ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sentative relied on the order of the CIT(A). According to the Departmental Representative, the appeal is wholly misconceived and the assessee is not entitled to any further relief from this Tribunal. The Departmental Representative relied on the decision of Ahmedabad Bench of this Tribunal since reported in 27 ITD 397 (sic). 4. We have given due consideration to the submissions of both the representatives and perused the orders of both the lower authorities as well as the documents found in the assessee's paper-book relevant for the purpose of disposal of this appeal. In our view, for the reasons which we give below, the assessee's appeal has to be allowed in part. The AO has not mentioned whether he invoked the provisions of s. 69 or s. 69B and made the addition to the extent of Rs. 12,50,000. However, we think that the AO invoked the provisions of s. 69B and not s. 69 of the Act, because the provisions of s. 69 can get attracted where the investment is not recorded in the books of account of the assessee and there is no explainable source. In the instant case, the sum of Rs. 31,320 being purchase price was made out of the withdrawal from the firm of M/s Vimla Prints in whic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y should have some basic material and evidence in their hands which we do not find in the instant case. Understatement of consideration or payment of excess concealed money has to be proved by the Department as has been stated by the Hon'ble Supreme Court in the case of K.P. Varghese. Though their Lordships of the Supreme Court were concerned about the controversy relating to understatement of consideration in terms of the provisions of s. 52(2) of the Act, yet the observations made therein are relevant for the purpose of deciding this appeal. Ahmedabad Bench 'A' of this Tribunal in the case of Gautam Laljibhai Gajjar vs. ITO while considering the controversy relating to unexplained investment has taken a view in para 7.2 at page 517 of 37 ITD as under: "Such a case made by the ITO cannot even be sustained by resort to s. 69B which provides that amount of investment etc. not fully disclosed in books of account may be deemed to be the income of the assessee for such financial year in which the assessee is found to be the owner of such assets. The legal fiction enacted in s. 69B comes into effect only where all the circumstances enumerated in s. 69B do factually exist. The onus to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... take this into account. However, we find that the assessee has no ostensible source for incurring the expenditure towards cost of stamp-paper, registration charges and other incidental expenses which are commonly incurred in connection with purchase and sale of any immovable property. We, therefore, estimate a sum of Rs. 5,000 as being spent by the assessee in meeting such expenditure and for which no ostensible source or explanation has been given either before the lower authorities or even before us. We, therefore, vacate the finding and direction of the CIT(A) in this regard and direct the AO to add a sum of Rs. 5,000 as expenditure on stamp-papers etc. made by the assessee without there being any valid explanation or source. 7. Insofar as the household expenses, we are inclined to agree with both the lower authorities as the assessee has not been able to explain satisfactorily how he has been able to maintain himself in the absence of any withdrawal from anywhere. In the absence of proper explanation about the source we agree with the lower authorities and confirm the addition of Rs. 12,000 towards household expenses. 8. In the result, the appeal is partly allowed. - ..... X X X X Extracts X X X X X X X X Extracts X X X X
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