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Income Tax Appellate Tribunal, DELHI BENCH : SMC : NEW DELHI
Before: SHRI C.M. GARG
BEFORE SHRI C.M. GARG, JUDICIAL MEMBER Assessment Year: 2012-13 Darshana Devi, Vs. ITO, 38/20, 8 Marla, Jatal Road, Ward-1, Panipat, Panipat. Haryana. PAN: BMWPD4902M (Appellant) (Respondent) Assessee by : Shri Rakesh Jain, Advocate & Shri Gurjeet Singh, CA Revenue by : Shri Om Parkash, Sr. DR Date of Hearing : 11.10.2022 Date of Pronouncement : 28.10.2022 ORDER
This appeal filed by the assessee is directed against the order dated 04.12.2017 of the CIT(A), Karnal, relating to Assessment Year 2012-13. 2. The grounds raised by the assessee read as under:- “1. Because the action is being challenged on facts & law, for upholding the assessment without having passed speaking order with returning findings on material facts containing material particulars, hence action in violation of principles of natural justice.
2. Because the action is being challenged on facts & law, for upholding the addition of Rs. 13.00 lacs by treating the same as undisclosed income.
3. Because the action is being challenged on facts & law, for Rs 11.00 lacs in spite of all transactions having been substantiated with documentary evidence & supporting pleadings, hence order dehors the material on record.
Because the action is being challenge on facts & law, for upholding the addition of Rs. 10 lacs in spite of having furnished all explanations & supporting documents explaining the transaction, hence erroneous action which is unwarranted.
For kindly granting the consequential relief and (or) legal claim & to kindly allow amendment, addition, deletion in the grounds before the disposal of the appeal and with a further prayer to take a decision in accordance with law in the interest of substantial justice.”
The ld. Counsel of the assessee submitted that the assessee did not want to press ground No.1. Therefore, the same is dismissed as ‘not pressed.’ Ground No.5 is general which requires no adjudication.
Ground No.2 4. The ld. Counsel of the assessee submitted that the AO, in the first paragraph of the assessment order dated 03.03.2015 u/s 143(3) of the Act, noted that Central Bureau of Investigation (for short, ‘CBI’) personnel had seized Rs.13 lakh in cash on 03.09.2011 and Rs.17 lakh in cash on 07.09.2011 from the assessee at Panipat in the presence of two government official witnesses. He further submitted that there is no case against the assessee or any of his family members by the CBI, but, the case was registered against Shri Ashwani Kumar Sharma, who entered into an agree with the assessee to purchase the property of the assesseee bearing House No.809, Ansals, Panipat for a consideration of Rs.30 lakhs and got Rs.10 lakh through cheque and Rs.20 lakh in cash from Smt. Meenakshi Monsotra, w/o Shri Ashwani Sharma and out of cash received of 2
Rs.20 lakh, the assessee handed over a sum of Rs.30 lakh in cash to the officials of CBI which is clearly noted by the AO in para 1 at page 2 of the assessment order. The ld. Counsel drew our attention to copy of the purchase deed dated 12.04.2010 of house bearing No.809, Ansals, Panipat, copy of sale deed dated 13.11.2011 of house hearing No.809, Ansals, Panipat and copy of bank statement of Dena Bank, wherein on 16.08.2011, a cheque amounting to Rs.10 lakh has been deposited to the bank account of the assessee. He further submitted that the copies of the seizure memo available at pages 4-6 of the assessee’s paper book dated 03.09.2011 clearly reveals that the assessee gave Rs.13 lakh to the CBI officers on 03.09.2011. Therefore, the ground No.2 of the assessee may kindly be allowed as the source of the amount is amply clear from the documentary evidence as well as the surrounding facts and circumstances.
5. On this ground, the ld. DR supported the assessment order and submitted that the assessee failed to demonstrate the source of the amount of Rs.13 lakh in cash given to the CBI officials, therefore, the AO was right in making the addition and the ld.CIT(A) was also correct in upholding the same.
On careful consideration of the above submissions, first of all, I note that the ld. Sr. DR has not disputed the fact that there is no case registered against the assessee or any of his family members by the CBI and the case has been registered against some government official Shri Ashwani Kumar Sharma and from the copy of the purchase deed dated 12.04.2010 I also observe that the No.809, Ansals, Panipat on 12.04.2010 by way of registered sale deed. From the assessment order itself, I further note that the AO himself noted from the reply of the assessee that the assessee had entered into an agreement to sell her house No.809, Ansals, Panipat for Rs.30 lakh and had got Rs.10 lakh through cheque and Rs.20 lakh in cash from Smt. Meenakshi Monsotra, wife of Shri Ashwani Kumar Sharma and out of cash received of Rs.20 lakh, she handed over the sum of Rs.13 lakh in cash to the CBI personnel. From the seizure memo available at pages 4-6 of the paper book it reveals that the amount of Rs.30 lakh has been seized on 03.09.2011. Copy of savings bank passbook of the assessee reveals that the assessee had deposited cheque of Rs.10 lakh on 16.08.2011 when the assessee entered into an agreement to sell the property with Smt. Meenakshi Monsotra, wife of Shri Ashwani Kumar Sharma. Therefore, it is safely gathered that the assessee had also received cash amount of Rs.20 lakh along with cheque of Rs.10 lakh on 16.08.2012. The CBI officials seized Rs.13 lakhs in cash from the assessee after a lapse of about 18 days, therefore, I safely gather that the source of Rs.13 lakh seized by the CBI on 03.09.2011 is discernible from the documentary evidence as well as facts noted by the AO in the assessment order. Therefore, in view of the foregoing, the addition made by the AO and confirmed by the ld.CIT(A) cannot be held as sustainable and, thus, I direct the AO to delete the same. Accordingly, ground No.2 of the assessee is allowed.
Apropos ground No.3, the ld. Counsel submitted that after the seizure of Rs.13 lakh, the CBI officials warned the assessee that the remaining amount of Rs.17 lakhs should be handed over to them without any delay within three days, otherwise, they would arrest her. The ld. Counsel further explained that in such compelling circumstances the assessee took unsecured loan of Rs.17 lakhs from her colleague and known neighbouring farmers listed by the AO at page 3 of the assessment order. The ld. Counsel further submitted that the AO without questioning the identity and credit worthiness of the creditors and the genuineness of the transactions, accepted the loan provided to the assessee by Shri Naveen Kaushik, and Shri Satbir Kaushik, but, raised objection to the credit worthiness of another three unsecured loan creditors viz., Shri Amit Kaushik, Shri Jagdish and Shri Ramphal, the total amounting to Rs.11 lakhs without any basis. The ld. Counsel pointed out that regarding loan creditor Shri Amit Kaushik, the assessee has submitted all relevant and substantial evidence before the authorities below in the form of confirmation available at page 83 of the assessee’s paper book, the AO also recorded his statement on 18.12.2014 wherein he categorically stated that during FY 2011-12, he provided Rs.4 lakh cash loan to the assessee which was required by her to deposit the same to CBI officials. The ld. Counsel also submitted that the assessee submitted copy of Jamabandi, copy of land of 8 acre belonging to Shri Amit Kaushik, but, the authorities below rejected the entire substantial documentary evidence by observing that no J-Form have been submitted regarding sale of crop. The ld. Counsel submitted that 8 5
Rs.4 lakh annually, therefore, the credit worthiness of the creditor Shri Amit Kaushik and genuineness of the transaction cannot be questioned.
The ld. Counsel also submitted that regarding loan creditor Shri Jagdish the assessee submitted copies of J-Forms which are available at pages 43-77 of the assessee’s paper book and J-Forms in respect of another loan creditor Shri Ramphal are available at pages 35-87 of the assessee’s paper book. The ld. Counsel submitted that Shri Jagdish and Shri Ramphal submitted affidavits in favour of the assessee and copies of Aadhar card of Shri Amit Kaushik and Shri Ramphal and copy of ration card of Shri Ramphal were also submitted before the authorities below which were ignored. The ld. Counsel also submitted that copy of bank statement of Shri Amit Kaushik was also placed at pages 39-42 of the assessee’s paper book which reveals that Shri Amit Kaushik is a person of means having sufficient funds available with him and, therefore, the credit worthiness of loan creditor cannot be disputed. The ld. Counsel submitted that the CBI officials put immense pressure on the assessee to submit the remaining part of Rs.17 lakhs for seizure in the case of Shri Ashwani Kumar Sharma under the threat of arrest, therefore, under compelling circumstances the assessee put restless efforts and collected money from five loan creditors and provided the same to the CBI officials on 07.09.2011, therefore, under the circumstances, the assessee cannot be punished twice – once by the CBI officials and secondly by the tax officials. The ld. Counsel submitted that the assessee being a lady was scared about the 6
CBI officials without registering any case against her or any of her family members. Therefore, the amount was collected in a hasty manner as the assessee had used the remaining amount of advance of Rs.17 lakhs for the purpose of entering into an agreement to purchase a property in Gurgaon. Therefore, due to non-availability of funds, the assessee was under compulsion to obtain unsecured loans from her known neighbouring farmers. Therefore, the amount of Rs.11 lakhs cannot be taxed in the hands of the assessee.
Replying to the above, the ld. Sr. DR submitted that the J-Forms of Shri Amit Kaushik was not submitted before the authorities below nor before the Tribunal and J-Forms pertaining to Shri Jagdish available at pages 48-52 of the paper book are not legible. Therefore, the action of the AO may kindly be confirmed. No other arguments have been placed by the ld. Sr. DR in this regard.
On careful consideration of the above rival submissions and on perusal of the paper book of the assessee especially pages 19-122, I note that before the AO the assessee submitted copies of affidavits of Shri Amit Kaushik, Shri Jagdish and Shri Ramphal, copy of Aadhar card of Shri Amit Kaushik, copy of driving licence of Shri Jagdish, copy of ration card and Aadhar card of Shri Ramphal, etc. Besides the above, the assessee also submitted copy of PAN of Shri Amit Kaushik, copy of bank passbook of Shri Amit Kaushik and Shri Ramphal. The assessee also submitted confirmations of Shri Amit Kaushik and J-forms of Shri Ramphal and Shri Jagdish. It is also pertinent to note that the AO recorded 7
statements of all three impugned unsecured creditors viz., Shri Amit Kaushik (PB pages 100-105), Shri Jagdish (PB 82-92) and Shri Ramphal (PB 114-119) wherein all the three creditors supported the fact that the assessee was asked by the CBI officials to submit Rs.17 lakh within a short span of time and they gave an amount of Rs.4 lakh and Rs.3 lakh to the assessee in cash which was provided by the assessee to the CBI officials for seizure on 07.09.2011. On careful and vigilant perusal of J-Form of Shri Jagdish (APB pages 48-52) I clearly observe that these are light printed but clearly legible and supports the status of Shri Jagdish and explanation of the assessee that the said loan creditor was owning agricultural land and earning exempt agricultural income out of sale proceeds of crop cultivated thereon. Thus, the objection of the ld. Sr. DR being hyper- technical is dismissed. No other objection has been placed by the ld. Sr. DR on this issue.
It is pertinent to mention that the AO has accepted the unsecured loan from Shri Naveen Kaushik and Shri Satbir Kaushik without any objection, but, disputed the amounts received by the assessee from said other three creditors. On the totality of the facts and circumstances under which the assessee had to collect an amount of Rs.17 lakhs in compliance to the directions of the CBI officials and after careful consideration and thoughtful perusal of the documentary evidence submitted by all the three creditors before the authorities below, I am of the considered opinion that there is no iota of doubt regarding the identity and credit worthiness of all the three creditors and regarding genuineness of the transaction, 8
AO was not correct and justified in making addition in the hands of the assessee amounting to Rs.11 lakh u/s 68 of the Act. Therefore, the findings recorded by the authorities below being contrary to the facts and circumstances of the case and not sustainable as per the provisions of the Act are directed to be deleted.
Ground No.4 12. Apropos ground No.4, the ld. Counsel submitted that the AO in the first para at page 2 of the assessment order, noted that the assessee had entered into an agreement to sell her house No.809, Ansals, Panipat for a consideration of Rs.30 lakh and had got Rs.10 lakh through cheque and Rs.20 lakh in cash from Smt. Meenakshi Monsotra, w/o Shri Ashwani Kumar Sharma and out of cash received of Rs.20 lakh, she handed over a sum of Rs.13 lakh to CBI officials. From the copies of the purchase deed available at pages 1-7 of the assessee’s paper book II dated 12.04.2010, it is clearly discernible that the assessee purchased a property from Ansals Builders bearing house No. 809, Ansals, Panipat and entered into an agreement with Smt. Meenakshi Monsotra, wife of Shri Ashwani Kumar Sharma and received Rs.10 lakh by cheque and Rs.20 lakh in cash against the said agreement. From the copy of the passbook of the assessee available at pages 12-13 of the assessee’s paper book II, it is clearly discernible that on 16.08.2011, an amount of Rs.10 lakh was credited to the savings bank account of the assessee on account of clearing of cheque No.10 of State Bank of India and, thereafter, on 24.08.2011, the same amount was 9
Shri Ram Shara by cheque No.635381. The ld. Counsel lastly submitted that the same amount was used by the assessee for entering into an agreement for purchase of property in Gurgaon.
The ld. DR supported the order of the authorities below and submitted that the assessee failed to prove that the amount of Rs.10 lakh credited to her bank account was the amount of advance received under the agreement to sell the property, therefore, the AO was right in making the addition and the CIT(A) was also correct in confirming the same. Therefore, the ground No.4 of the assessee be dismissed.
On careful consideration of the rival arguments of both the sides, first of all, I observe that the assessee was owning House No.809, Ansals, Panipat and Rs.10 lakh was credited to her bank account on 16.08.2011. The assessee entered into an agreement to sell of the said property to the wife of Shri Ashwani Kumar Sharma and received Rs.10 lakh by cheque and Rs.20 lakh in cash. These facts have not been controverted by the AO or the CIT(A) in any manner. Therefore, I reach to a logical conclusion that the impugned amount of Rs.10 lakh credited to the bank account of the assessee is advance against the agreement to sell the property.
In view of the above, the factum of receipt of Rs.10 lakh under the agreement to sell House No. 809, Ansals, Panipat, which was owned by the assessee at the relevant point of time on 16.08.2011 is clearly established which 10
cannot be doubted in any manner. Therefore, the reasons recorded for confirming the addition of Rs.10 lakh by the authorities below are baseless and perverse and, hence, the AO is directed to delete the addition. Accordingly, ground No.4 of the assessee is allowed.