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Income Tax Appellate Tribunal, JAIPUR BENCHES, JAIPUR
Before: SHRI RAMESH C. SHARMA, AM & SHRI VIJAY PAL RAO, JM
This appeal by the assessee is directed against the order dated 27.10.2017 of ld. CIT (A)-I, Jaipur for the assessment year 2014-15. The assessee has raised the following grounds :- “
1. That the authorities below have erred in treating a sum of Rs. 80,00,000/- as income from undisclosed sources and added to the declared total income of the petitioner u/s 68 of the IT Act, 1961 as tax is charged as per provision of section 115BBE of the IT Act, 1961.
2. That the order so passed by the Authorities below is bad in law as well as on facts.
3. Without prejudice to the above, the addition so made by the Authorities below amounting to Rs. 80,00,000/- is very much excessive.
4. That the petitioner craves to add, alter or amend all or any of the grounds of appeal on or before the date of hearing.”
The assessee is an individual and filed return of income on 6th July, 2014 2. declaring total income of Rs. 1,82,410/-. During the scrutiny assessment, the AO noted that a large cash was deposited in the savings bank accounts of the assessee.
The AO noted that there are cash deposits of Rs. 97,77,840/- and cash withdrawals of Rs. 22,75,000/- during the year under consideration in 4 bank accounts of the assessee. The assessee explained that he has executed two agreements for sale of agricultural lands and power of attorney-holder of his wife Smt. Prem Kumari and received a total sum of Rs. 90,00,000/- from two purchasers, namely, Shri Bhura Ram and Shri Bhanwar Lal Meghwal of Rs. 45,00,000/- each. The AO asked the assessee to produce the purchasers to confirm the sale of agricultural land and receipt of the consideration. The assessee showed his inability to produce the purchasers. The AO accordingly made the addition of Rs. 80,00,000/- under section 68 of the IT Act. The assessee challenged the action of the AO before the ld. CIT (A) but could not succeed.
Before us, the ld. A/R of the assessee has reiterated the contention that the assessee has acted as a Power of Attorney holder and to execute two sale agreements for a consideration of Rs. 45,00,000/- each and received a total sum of Rs. 90,00,000/-. The ld. A/R has submitted that as per the Agreement it is clear that the amount was received through cheques from the purchasers who are NRI and, therefore, the assessee has discharged his onus to prove the identity, creditworthiness and genuineness of the transaction. The ld. CIT (A) has treated the addition under section 69 whereas the AO has made the addition under section 68 of the Act. Therefore, there is a contradictory finding by the ld. CIT (A). In support of his contention, he has relied upon the decision of Hon’ble Andhra Pradesh High Court in case of CIT vs. M. Venkateshwara Rao & Co., 279 CTR 313 (AP) as well as the decision of Hon’ble Jurisdictional High Court in case of CIT vs. ACE India Abodes Ltd. dated 11th September, 2017 in IT Appeal No. 45 of 2012. He has also relied upon the decision of Coordinate Bench of this Tribunal in case of Gyan Chand Agarwal vs. Addl. CIT dated 10.07.2017 in ITA No. 266/JP/2017.
On the other hand, the ld. D/R has submitted that a huge cash was found deposited in the four bank accounts of the assessee for which the assessee has tendered the explanation that the assessee received a sum of Rs. 80,00,000/- from two purchasers, namely, Shri Bhura Ram and Shri Bhanwar Lal Meghwal on account of sale of agricultural land. It was also submitted that the assessee has executed two sale agreements in the capacity of Power of Attorney holder of his wife whereas the assessee has not even filed the confirmation of the purchasers or the purchasers themselves for verification of the AO. He has further submitted that the alleged agreements to sale are not registered and, therefore, in the absence of the confirmation or subsequent title deed for transfer of land, these documents are self serving after thought documents. He has relied upon the orders of the authorities below.
We have considered the rival submissions as well as the relevant material on record. It is not disputed that cash deposit of more than Rs. 97,00,000/- was found in the four bank accounts of the assessee. The AO after considering the withdrawals during the year, has made an addition of Rs. 80,00,000/- as income from undisclosed source. The details of the deposits in the bank accounts are given at page 3 of the assessment order as under :-
Name of the Bank Account No. Cash withdrawals Cash deposits during F.Y. 2013-14. during F.Y. 2013-14.
ICICI Bank, St. 678401010251 1805000/- 5874840/- Xavier School Campus, Jaipur. ICICI Bank 672901001410 40000/- 2545000/- Sidhmukh ICICI Bank 672901034059 50000/- 1240000/- Sidhmukh Indian Overseas 056201000003950 380000/- 118000/- Bank, Bani Park, Jaipur Total cash withdrawals and cash 22,75,000/- 97,77,840/- deposits during F.Y. 2013-14.
The assessee has not disputed this fact of deposit of cash. However, the only explanation furnished by the assessee is that as per the two agreements to sale dated 29.03.2014, the assessee in the capacity of Power of Attorney holder of his wife received Rs. 40,00,000/- under each agreement total amounting to Rs. 80,00,000/-. The assessee has further explained that since the balance of Rs. 5,00,000/- was not received by the assessee, therefore, the sale document was not registered. We note that the entire consideration of Rs. 80,00,000/- was stated to have been received by the assessee in cash and there was no amount received in cheque or through other banking system. Therefore, the explanation of the assessee that the purchasers are NRI and having sufficient funds in their accounts cannot be accepted when the entire consideration was claimed to have been received in cash. It is pertinent to note that till date the assessee has not executed any title document being sale deed for sale of the alleged agricultural land.
Therefore, the veracity of the documents produced by the assessee cannot be accepted in the absence of subsequent sale deed through which the land in question can be transferred. Despite various opportunities by the AO, the assessee neither produced any confirmation from the alleged purchasers nor the purchasers were produced for examination of the AO. The ld. CIT (A) has considered this issue in para 3.1.2 as under :- by the AO is to be treated as made u/s 69 of the Act and the assessment order is modified accordingly.”
In view of the above facts and circumstances of the case, when the assessee has failed to produce any evidence which can be independently verified or to produce the confirmations of the alleged purchasers, the assessee has not discharged his onus of proving the genuineness of the transaction. Since the assessee took the objection regarding the addition made under section 68, therefore, the ld. CIT (A) has treated the same as addition under section 69 being unexplained deposits in the bank accounts. We have carefully gone through the decisions relied upon by the assessee and found that some of the decisions are not on the issue before us and others are also distinguishing when the assessee has completely failed to produce a satisfactory explanation along with the evidence. We do not find any error or illegality in the order of the ld. CIT (A). Accordingly, we do not find any merit or substance in the present appeal of the assessee.
In the result, appeal of the assessee is dismissed.
Order is pronounced in the open court on 30/05/2019.