VARUN DEWAN,GHAZIABAD vs. INCOME TAX OFFICER WARD 2(2)(5), GHAZIABAD

Heard both the sides and perused the records.

Brief facts of the case are that in this case an AIR information was received that the assessee had purchased immovable property of Rs. 43,00,000/- on 30.11.2011 from SRO-IV, Ghaziabad during the FY 2011-12 relevant to AY 2012- 13. After recording reasons and obtaining prior approval from the PCIT, Ghaziabad, notice u/s. 148 of the Act was issued on 29.03.2019 and served upon the assessee. The assessee filed income tax return in response to notice issued u/s. 148 of the Act. On perusal of the information provided by the SRO-II, AO noted that the assessee had purchased property for Rs. 39,50,000/- and paid stamp duty of Rs. 2,66,500/- jointly with Sh. Siddharth Dewan. So, his share comes to RS. 21,18,250/- on which investment made remained unexplained. On perusal of the document available on record, it has been noticed by the AO that the assessee had taken home loan of Rs. 20,00,000/- from the Oriental Bank of Commerce. But he has not submitted any corroborative evidence related to payment of balance amount to the tune of Rs. 22,36,500/- and assessee’s share comes to Rs. 11,18,250/- (being 50% of balance investment). Accordingly, the AO has made the addition of Rs. 11,18,250/-. Aggrieved with the action of the AO, assessee preferred the appeal before the Ld. CIT(A), who vide his impugned order dated 19.03.2025 sustained the addition by dismissing the appeal of the assessee. Against the order of the Ld. CIT(A), assessee is in appeal before me. Ld. DR relied upon the orders of the authorities below.

It is noted that it was the contention of the assessee that during the year, house property no. D-93, Ramaprastha Colony, Distt. Ghaziabad has been sold by him for Rs. 82,00,000/- and immediately the deposit of Rs. 4,00,000/- and Rs. 6,00,000/- on 19.02.20211 and 25.04.2011 was made in his current bank account with Oriental Bank of Commerce was the advance received against sale of the said property. Assessee has filed copy of loan agreement between Sh. Sushil Kumar Bhatia and the assessee on stamp paper specify name and address of Sh. Sushil Kumar Bhatia(lender); copy of cheque of Rs. 25,00,000/- issued by Sushil Kumar Bhatia in favour of assessee; copy of bank statement of Shri Sushil Kumar Bhatia with Oriental Bank of Commerce, Shahdara, Delhi in operation since 27.12.1990. He also made request to verify the above loan from bank. CIT(A) has not considered Rs. 4,86,500/-, the documentary evidence provided with respect contribution made 2 | P a g e from Paridhi Creation where assessee is Proprietor. Following is the breakup of amount investment and source of investment submitted by the assessee:- Cost of flat 39,50,000/- Stamp duty 2,86,500/- 42,36,500/- Less : loan from bank 20,00,000/- 22,36,500/- Less : Contribution by the assessee 4,76,500/- From bank account in the name 17,50,000/- Of ‘Paridhi Creation’ where Assessee is Proprietor. Less: Contribution out of loan of Rs. 25,00,000/- from Shri Sushil Kumar Bhatia 17,50,000/- 4.1 It was further submitted that CIT(A) erred in confirming the addition of Rs. 11,18,250/- without proper consideration, because Rs. 4,76,500/- contributed by the assessee from his own sole proprietorship concern Paridhi Creation of which evidence have been provided before the AO and Rs. 17,50,000/- is out of loan Rs. 25,00,000/- received from Shri Sushil Kumar Bhatia despite providing copy of loan agreement with Shri Sushil Kumar Bhatia; copy of cheque no. 25,00,000/- issued from bank of Sh. Sushil Kumar Bhatia; copy of bank statement of Shri Sushil Kumar Bhatia from where payment is made and Shri Sushil Kumar Bhatia is assessed to income tax and owning house property sold during the year for RS. 82,00,000/-. In view of the aforesaid contentions, I am of the considered view that assessee has truly and fully explained the source of investment therefore, the 3 | P a g e addition in dispute made in the hands of the assessee is not sustainable in the eyes of law, hence, the same is deserved to be deleted. Accordingly, I delete the addition in dispute by setting aside the orders of the lower authorities in the instant case.

In the result, the Assessee’s appeal is allowed. Order pronounced in the Open Court on 07.08.2025.