HARSHA HARSH VARANDANI ,MUMBAI vs. ITO -22(1)(5), MUMBAI

A.Y. 2013-14 Harsha Harsh Varandani 4.2 Aggrieved with the order of Ld. AO, the assessee preferred an appeal before Ld. CIT(A). The assessee’s appeal was dismissed as no evidences regarding sources of funds invested in the purchase of property was submitted by the assessee during the appellate proceedings. Aggrieved with the order of Ld. CIT(A), the assessee has filed an appeal before the Tribunal. 4.3 Before us, Ld. AR has furnished a fresh affidavit dated 12.12.2024 of Shri Harsh J. Varandani, husband of the assessee wherein he has explained that the property was purchased by the assessee from a company, M/s. Crown Construction Company and the payment was made by another Dubai based company, M/s. Crown General Trading Company FZC out of its bank account held in RAK BANK Barjuman Branch, Dubai as per his instructions and this payment was debited to the capital account of Shri Harsh J. Varandani . Thus, Shri Harsh J. Varandani has categorically confirmed that an amount equal to Rs. 1.25 cr. was paid by him on behalf of the assessee for the purchase of immovable property and the same was routed through his account maintained with M/s. Crown General Trading Company FZC. Further, Ld. AR has also filed a confirmation from M/s. Crown General Trading Company FZC and an extract of its bank statement of in support of this payment. 4.5 Ld. DR, on the other hand, has relied on the orders of the lower authorities and submitted that in the absence of requisite documentary A.Y. 2013-14 Harsha Harsh Varandani evidences, the addition has rightly been made by the Ld. AO and deserves to be upheld. 4.6 We have considered the rival submissions and perused the material placed before us. We are of the view that the addition of Rs. 1,26,35,633/- in the hands of the assessee u/s 68 was not justified as she has duly discharged the onus by furnishing the affidavit from her husband along with supporting documentary evidences to establish the source of investment in the purchase of the property. We, therefore, delete the addition made by the Ld. AO amounting to Rs. 1,26,35,633/- in the hands of the assessee. This ground of appeal is allowed in favour of the assessee.

5. Ground No. 2 relates to the addition on account of undisclosed income from the sale of shares - Rs. 33,94,153/- 5.1 Brief facts of the issue are that on verification of the Annual Information Return [AIR] information in the case of the assessee, Ld. AO noticed that shares worth Rs. 33,94,153/- have been sold by the assessee during the year under consideration whereas no profit on shares or capital gains have been declared in the return. Since no explanation was furnished with regard to the share transactions, Ld. AO treated the total amount of Rs. 33,94,153/- as undisclosed income of the assessee during the year. 5.2 As no supporting documentary evidences to explain these transactions was filed before the Ld. AO as well as Ld. CIT(A), the addition made by the Ld.

A.Y. 2013-14 Harsha Harsh Varandani AO of the entire sale consideration of Rs. 33,94,153/- was upheld by the Ld. CIT(A). 5.3 Before us, Ld. AR has furnished copies of contract notes issued by the broker for sale of share for AY 2013-14. However, since the issue has not been examined by the lower authorities, we deem it appropriate to restore the matter to the file of Ld. AO for computing the capital gains arising out of the sale of shares on the basis of evidences furnished by the assessee, after due verification. The assessee is also directed to furnish complete details in this regard before the Ld. AO. This ground is accordingly allowed for statistical purposes.