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Income Tax Appellate Tribunal, ‘A’ BENCH: CHENNAI
Before: SHRI MAHAVIR SINGHAND SHRI MANOJ KUMAR AGGARWAL
आदेश / O R D E R
Per Mahavir Singh, Vice President :
This appeal by the assessee is arising out of the order of Commissioner of Income Tax (Appeals)-7, Chennai, in ITA No.85(T- 14)/CIT(A)-7/2017-18 dated 31.03.2019 for the Assessment Year 2015-16. The Assessment was framed by Income Tax Officer, Non Corporate Circle-20(1), Chennai u/s. 143(3) of the Income Tax Act, 1961 (hereinafter ‘the Act’) vide order dated 29.12.2017.
2. The only issue in this appeal of assessee is as regards to the order of CIT(A) in confirming the action of the A.O in making addition of Rs. 2,15,28,200/- being cash credits deposited in the bank u/s. 68 of the Act and rejected the claim of assessee that the same is arising out of sale of standing crops/trees. For this, the assessee has raised 10 grounds, which are argumentative and factual and hence, need not be reproduced.
The brief facts are that during the year under consideration, the assessee sold his agricultural land along with standing trees and live stock and claimed the total sale consideration at Rs. 2.75 Crores. The assessee offered capital gain at Rs.2,72,78,000/- after deducting cost of acquisition and offered the balance capital gain and claimed as exempt u/s. 10(37) of the Act. The A.O during the course of assessment, while verifying the sale deed noted that the assessee has sold agricultural land and actual sale consideration is only at Rs.59,71,800/-. Inclusive of land and standing trees, The A.O noted that there was huge cash deposit totaling to Rs. 3.24 Crores in his bank account and the assessee asked to explain the cash deposit.
The assessee explained that this cash deposit is out of the sale consideration of agricultural land, to be claimed by the assessee, at Rs. 2.75 Crores as against actual sale consideration noted in the sale deed at Rs. 59,71,800/-. The A.O required the assessee to explain as to why the balance amount of Rs.2,15,28,200/- be treated as unexplained cash credit deposited u/s. 68 of the Act. The assessee explained vide letter dated 26.12.2017 and the relevant is quoted in the assessment order and the same being reproduced for the sake of clarity as under:
“1. During the previous year relevant to the said A.Y, the assessee had sold the agriculture land measuring about 9.94 Acres situated in Kollangarai Village, Thanjavur District to Mr. Anbuvel Rajan and the sale deed was executed on 23.01.2015 for a Sale Consideration of Rs.59,71, 800/- and also received sum of Rs.2,15, 28,200/- for about 1,000 standing trees ( namely Coconut, Sapotta, Mango, Rosewood, Teakwood & other valuable species with standing crops ready for harvest in addition to the aforesaid sale consideration mentioned in the sale deed.
2. There is no written Sale Agreement for the sale of land nor confirmation agreement in respect of the said agriculture land sale transactions."
The A.O finally held as under:
“1. The assessee is unable to bring the confirmation from the purchaser that the amount of Rs.2.75 crore received towards the sales consideration of the above said property along with trees.
The àssessee also fails to produce any sale agreement or any proof substantiating the fact that the amount received was towards the sales of land and trees and also could not furnish any valuation report to substantiate that an amount of 2.15 Cr paid towards the value of trees.
3. As per the registered Sale Deed, it is verified that Sale consideration of Rs.59,7 1,800/- was inclusive of land and standing trees vide Page no l8 of the said Sale deed. Thus no separate valuation of trees is required.”
Accordingly, the A.O treated the amount of Rs. 2,15,28,200/- as unexplained cash deposit u/s. 68 of the Act as the assessee’s cash deposit was in his bank accounts as cash deposit from unexplained sources. Aggrieved, the assessee preferred appeal before CIT(A).
The CIT(A) after verifying the sale deed noted the sale consideration including sale of trees at Rs.59,71,800/- as noted in sale deed and finally confirmed the action of the A.O by observing as under:
“The factual position that is therefore established are.: a) The purchaser has made payment to the extent of Rs.59,71,800/-. b) The market value of the said property along with the trees / plants is Rs 59,71,800/-. c) There is no evidence of Sale of standing Crops of cattle over a period of time before the sale of the impugned agricultural land as is being claimed. Therefore, I find no reason to interfere with the AO's findings that the amount received towards sale of land together with trees was to the tune of Rs. 59,71,800/- only as per the registered sale Deed dated 19.01.2015 and the balance amount Rs 2,15,28,200/- is to be considered as unexplained cash deposit u/s 68 of the Act, not related to agricultural land. A.O's order hereby stands confirmed and assessee's appeal is dismissed.”
Aggrieved, now the assessee is in appeal before the Tribunal.
Before us, the Ld. counsel for the assessee relied on the confirmation letter given by the assessee purchased from Mr. V.R.
Anbuvel Rajan vide confirmation dated 27.12.2017 and the relevant confirmation reads as under:
V.R.Anbuvel Rajan 7I4, Sardar Patel Road, Dt. 27.12.2017 Adyar, Chennai-20 CONFIRMATIONLEITER
I, V Anbuvel Rajan, S/o. R Ramaswamy, Hindu, aged atout 46 years, do hereby declare that I have Purchased an Agricultural Land measuring about 9.94 Acres situated at Vengarayan Kudkadu, Kollangarai Vatudempsttu Village, Thanjavur District in January 2015 for a Sale Consideration of Rs. 59,71,800/- fron Mr N Appadural, S/o, M Nagalingam. Further, I facilitate to sell the cows, goats and other trees (apart from the trees retained by me) belong to Mr N Appadurai through one Mr Anbu alais Aranganathan. Sd/- V.R.ANBUVEL RAJAN
The Ld. counsel stated that the sale of trees are mentioned in the sale deed and the assessee has received this consideration out of sale of agricultural land and sale of trees.
On the other hand, the Ld. Sr. D.R, Shri ARV Sreenivasan, Addl.
CIT stated that there is no evidence that the assessee has sold the standing trees and live stock to the extent of Rs.2,15,28,200/-, addition made by A.O, apart from the sale consideration recorded in the sale deed dated 23.01.2015 at Rs. 59,71,800/-. The Ld. Sr. D.R stated that the CIT(A) has reproduced complete statement enclosed in assessee’s sale deed and has registered in the Indian Stamp Act that the sale consideration received is at Rs. 59,71,800/- including sale of trees. In term of the above, the Ld. Sr. D.R stated that the A.O has rightly made addition and CIT(A) has rightly confirmed the same.
We have heard the rival contentions and gone through the facts and circumstances of the case. Admittedly, that there is huge cash deposits in assessee’s bank account totaling to Rs. 3.24 Crore. When it was asked to explain sources of cash deposits, the assessee explained that the same is out of sale consideration of agricultural land at Rs. 2.75 Crore, whereas the factual position is that the sale consideration as per sale deed including sale of trees and live stock is at Rs. 59,71,800/-. The assessee before us or before CIT(A) or before A.O could not establish that over and above the sale consideration recorded in the sale deed at Rs. 59,71,800/- inclusive of land and standing trees is received by assessee at Rs. 2.75 Crore. The onus is on assessee to prove by filing documentary evidences that the assessee has received this sum of Rs. 2,15,28,200/- on account of sale of trees or live stock, which the assessee failed to do as there is no evidence that the assessee has received over and above Rs.59,71,800/-. Hence, there is no basis for deletion of the addition. We find that no infirmity in the orders of lower authorities and hence, the same are confirmed.
In the result, the appeal of the assessee is dismissed.
Order pronounced on 02nd August, 2023.