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Income Tax Appellate Tribunal, JAIPUR BENCH ‘A’, (VC
Before: SHRI SANDEEP GOSAIN, JM & SHRI VIKRAM SINGH YADAV, AM
This appeal by the assessee is directed against the order dated 23.12.2019 of ld. CIT (A)-2, Jaipur for the assessment year 2012-13. The solitary ground raised by the assessee relates to challenging the order of the ld. CIT (A) in upholding the addition of Rs. 6,50,000/- under section 69B of the I.T. Act.
2. The brief facts of the case are that the assessee company filed its return of income for the assessment year 2012-13 on 29.09.2012 declaring total income at Rs. NIL. The case of the assessee was selected for scrutiny under section 143(3) of the IT Act. The AO while completing the assessment under section 143(3) of the IT Act has made an addition of Rs. 6,50,000/- on account of unexplained investment under section 69B of the IT Act. The assessee challenged the action of the AO before the ld. CIT (A). However, the ld. CIT (A) has upheld the assessment order confirming the addition.
We have heard the rival contentions and carefully perused the material available on record, judgments cited by the both the parties as well as the orders passed by the revenue authorities. The ld. Counsel for the assessee has submitted that during the year under consideration the assessee has purchased land situated at village Dudu for a consideration of Rs. 39,12,000/- and Rs. 32,15,000/- from Shri Narayan and Shri Ganga Ram respectively. In order to examine the transactions, the AO issued summons under section 131 of the IT Act to the sellers and consequently their statements were also recorded. In the statements, both the persons i.e. Shri Narayan and Shri Ganga Ram admitted that they sold the land to the assessee for a consideration of Rs. 44,00,000/- and Rs. 34,60,000/- out of which a sum of Rs. 4,00,000/- and Rs. 2,50,000/- respectively received in cash as advance and the remaining amount was received through cheques. Whereas on the contrary, the assessee had shown the cost of the land at Rs. 39,12,000/- and Rs. 3,15,000/- respectively in the books of account excluding stamp duty and other expenses. Therefore, the AO added a sum of Rs. 6,50,000/- under section 69B of the IT Act by holding that the above investment of Rs. 6,50,000/- was made by the assessee out of books of account, the source of which has not been explained. On the contrary, the ld. Counsel for the assessee specifically submitted before us that the AO was wrong in making the addition of Rs. 6,50,000/- under section 69B of the Act without giving any opportunity to the assessee and even the opportunity to cross examine the sellers was not provided. It was further submitted that the revenue has not placed any evidence to show that the assessee had made any such investment.
In order to support his version, the assessee relied on the decisions of Hon’ble High Courts in the cases of CIT vs. Naresh Khattar (HUF) 261 ITR 664 (Delhi), Smt. Amar Kumari Surana vs. CIT, 226 ITR 344 (Raj.) wherein it was held that the burden is on the revenue to prove the real investments exceeding investments shown in the books of account of the assessee.
3.1. After having gone through the facts of the present case and after perusal of the statements made by the sellers under section 131 of the Act, we find that in the entire statements of the sellers nowhere name of the assessee was mentioned.
Apart from recording the statements under section 131, the revenue was not having any other corroborative evidence to prove that the assessee had made investments exceeding the amount shown in the books of account. As per the decision in the case of Smt. Amar Kumari Surana vs. CIT (supra), the Hon’ble Rajasthan High Court has already held that the burden is on the revenue to prove that the investments were made exceeding the amount shown in the books of account of the assessee. In the present case, the revenue has failed to discharge its onus. In the statements recorded under section 131 of the IT Act, the sellers had not mentioned the name of the assessee but had told that the land was sold through Agent and cannot remember his name. Though the ld. D/R appearing on behalf of the revenue relied on the decision in the case of Bela Juneja vs.CIT, 20 taxmann.com 392 (Delhi), however, the paramateria contained in the said judgment is not relevant to the facts of the present case as in the said case documents were seized which revealed that the assessee had purchased the property at a higher sum than what was revealed in the sale deed. However, in the present case no documentary evidence has been placed on record which revealed that the assessee in the present case had purchased the property in question at a higher sum than what was revealed in the sale deed. Even otherwise, after going through contents of the registered sale deeds placed on record, we are of the view that these sale deeds are registered documents and the sale consideration of Rs. 39,12,000/- and Rs. 32,15,000/- were received by Shri Narayan and Shri Ganga Ram respectively. On the contrary, no document or corroborative evidence has been placed on record by the revenue authorities to prove that the investments made exceeded the investments shown in the books of account of the assessee. Therefore, merely stating that the assessee made investments exceeding the amount shown in the sale deed would not fasten any liability on the assessee under section 69B of the IT Act. Therefore, keeping in view the facts of the present case and following the decisions of the Hon’ble High Courts relied on by the ld. Counsel, we delete the addition.
In the result, appeal of the assessee is allowed.
Order pronounced in the open court on 09/02/2021.