SHRI DHIREN KUMAR SAHOO,DHENKANAL vs. ITO, DHENKANAL WARD, DHENKANAL, DHENKANAL

आयकर अपीऱीय अधिकरण, “एस.एम.सी”, न्यायपीठ,कटक IN THE INCOME TAX APPELLATE TRIBUNAL “SMC” BENCH, CUTTACK श्री चन्द्र मोहन गगग, न्द्याययक सदस्य के समऺ । BEFORE SHRI CHANDRA MOHAN GARG, JUDICIAL MEMBER Stay Petition No.07/CTK/2019 (Arising out of ITA No.32/CTK/2019) (नििाारण वषा / Assessment Year :2012-2013) Shri Dhiren Kumar Sahoo, Vs. ITO, Dhenkanal Ward, Prop:-M/s Kanchan Jewellery, Dhenkanal Meena Bazar, Dhenkanal- 759001 स्थायी ऱेखा सं./ जीआइआर सं./ PAN/GIR No. : ARHPS 7887 F (अऩीऱाथी /Appellant) .. (प्रत्यथी / Respondent) AND ITA No.32/CTK/2019 (नििाारण वषा / Assessment Year :2012-2013) Shri Dhiren Kumar Sahoo, Vs. ITO, Dhenkanal Ward, Prop:-M/s Kanchan Jewellery, Dhenkanal Meena Bazar, Dhenkanal- 759001 स्थायी ऱेखा सं./ जीआइआर सं./ PAN/GIR No. : ARHPS 7887 F (अऩीऱाथी /Appellant) .. (प्रत्यथी / Respondent) यनधागररती की ओर से /Assessee by : Shri D.Pati, Advocate राजस्व की ओर से /Revenue by : Shri Subhendu Dutta, DR सुनवाई की तारीख / Date of Hearing : 13/06/2019 घोषणा की तारीख/Date of Pronouncement 14/06/2019 आदेश / O R D E R The Stay petition filed by the assessee seeking stay of demand of Rs.11,67,670/-, was listed today i.e. on 13.06.2019, however, the ld. AR of the assessee submitted that the appeal of the assessee may kindly be heard on merits, to which ld.DR has no objection. Accordingly, the stay petition filed by the assessee has become infructuous and with the

2 SP No.07/CTK/2019 & ITA No.32/CTK/2019 consent of the parties, I proceed to decide the appeal of the assessee on merits. 2. The assessee in its appeal has raised the sole ground with regard to addition confirmed by the CIT(A), which was made by the AO u/s.69 of the Act. 3. Facts in brief are that the assessee is a proprietor of M/s Kanchan Jewellers which is in the business of trading of gold and silver ornaments. A survey u/s.133A of Act was conducted at the business premises of the assessee on 05.02.2013. During the course of survey it was found that the assessee has purchased land and building at R.L.Pandey Market Complex, Kanchan Bazar, Dhenkanal on 27.03.2012 of Rs.31,56,086/-. He further claimed that an amount of Rs.6 lakh was paid through cheque and source of payment of the balance amount of Rs.25,56,0186/- could not be explained by the assessee. Subsequent to the survey, AO framed the assessment u/s.143(3)/147 of the Act making addition of Rs.25,56,086/- u/s.69 of the Act on account of unexplained investment. In appeal before preferred by the assessee, the CIT(A) has also in agreed to the observations of the AO and dismissed the appeal of the assessee. Now, the assessee is in further appeal before the Tribunal. 4. Ld. AR submitted that as per reply of the assessee the assessee purchased land and building against total consideration paid Rs.27,45,170/- including cost of land and building at Rs.25,65,370/-, stamp duty of Rs.1,28,270/- and registration fees of Rs.51,530/- out of which the assessee paid Rs.6 lakhs to the seller at the time of on or

3 SP No.07/CTK/2019 & ITA No.32/CTK/2019 before execution of sale deed. Ld.AR vehemently pointed out that out of Rs.6 lakhs paid to the seller, the assessee paid Rs.3,00,000/- vide cheque No.665343/dated 29.04.2011 and Rs.3,00,000/- vide cheque No.665344/dated 09.04.2011 paid out of his past savings. 5. Ld. AR vehemently pointed out that the authorities below have wrongly taken total sale consideration as Rs.31,56,086/-. Ld.AR submitted that the addition based on incorrect facts and figure may kindly be deleted. 6. Replying to the above, ld. DR submitted that addition has been made on the basis of statement of assessee recorded on 05.02.2013 during the course of survey u/s.133A of the Act, 1961 (for short ‘the Act’), wherein replying to question No.9 the assessee submitted that the assessee has paid Rs.3,00,000/- vide cheque No.665343/dated 29.04.2011 and Rs.3,00,000/- vide cheque No.665344/dated 09.04.2011 paid out of his past savings. However, he could not controvert the figure and fact that as per reply of assessee, the total sale consideration, including stamp duty and registration was Rs.27,45,170/- and, thus, the sale consideration taken by the authorities below is not correct. 7. Placing rejoinder to the above, ld.AR submitted that the final statement of the assessee was recorded in a hasty manner without allowing opportunity to go through the partner’s papers and other facts relevant to the purchase of land and building, therefore, payment of Rs.6 lakhs may kindly be accepted against purchase of land and building.

4 SP No.07/CTK/2019 & ITA No.32/CTK/2019 8. On careful consideration of the above rival submissions, first of all, I am of the view that the total sale consideration including stamp duty and registration fees is Rs.27,45,170/- which is discernible from the copy of the sale deed dated 27.03.2012. So far as payment at the time of on or before execution of sale deed is concerned, in the statement recorded during the survey the assessee stated to have made payment of Rs.3,00,000/- vide cheque No.665343/dated 29.04.2011 and Rs.3,00,000/- vide cheque No.665344/dated 09.04.2011 totalling to Rs.6,00,000/- paid out of his past savings and other funds cannot be discarded and dismissed at the threshold and, thus, the same is accepted. Finally, I hold that the assessee has paid Rs.6,00,000/- on or before execution of sale deed on 27.03.2012 and the total cost of land and building purchased was Rs.27,45,170/-. Therefore, after reduction of Rs.6 lakhs, there is no explanation from the assessee regarding remaining investment of Rs.21,45,170/- and when there is no satisfactory explanation regarding source of said investment then the same deserves to be treated as unexplained investment of the assessee u/s.69 of the Act and, thus, the addition made by the AO and confirmed by the CIT(A) is restricted to Rs.21,45,170/-. Accordingly, the sole ground of assessee is partly allowed and the AO is directed to recalculate the addition as per direction given hereinabove. Thus, appeal of the assessee is partly allowed.

5 SP No.07/CTK/2019 & ITA No.32/CTK/2019 9. Since we have heard and decided the appeal of the assessee in the earlier part of this order, therefore, the stay petition filed by the assessee has become infructuous and the same is dismissed. 10. In the result, stay petition of the assessee is dismissed and appeal of the assessee is partly allowed. Order pronounced in the open court on 14/06/2019. Sd/- (CHANDRA MOHAN GARG) न्यानयक सदस्य / JUDICIAL MEMBER कटक Cuttack; ददनांक Dated 14/06/2019 प्र.कु.मम/PKM, Sr.P.S. आदेश की प्रनिलऱपप अग्रेपषि/Copy of the Order forwarded to : 1. अऩीऱाथी / The Appellant- . Shri Dhiren Kumar Sahoo, Prop:-M/s Kanchan Jewellery, Meena Bazar, Dhenkanal-759001 प्रत्यथी / The Respondent- 2. ITO, Dhenkanal Ward, Dhenkanal 3. आयकर आयुक्त(अऩीऱ) / The CIT(A), आयकर आयुक्त / CIT 4. ववभागीय प्रयतयनधध, आयकर अऩीऱीय अधधकरण, कटक / DR, ITAT, Cuttack 5. आदेशािुसार/ BY ORDER, गार्ग पाईऱ / Guard file. 6. सत्यावऩत प्रयत //True Copy// (Senior Private Secretary) आयकर अपीऱीय अधिकरण, कटक / ITAT, Cuttack