SHRI SHARAD JAISWAL,BHOPAL vs. THE ITO 1(1), BHOPAL

आयकर अपील�य अ�धकरण, इंदौर �यायपीठ, इंदौर IN THE INCOME TAX APPELLATE TRIBUNAL, INDORE BENCH, INDORE BEFORE SHRI KUL BHARAT, JUDICIAL MEMBER AND SHRI MANISH BORAD, ACCOUNTANT MEMBER

ITA No.776/Ind/2014 Assessment Year: 2010-11 Sharad Jaiswal, Income Tax Officer 1(1), G-106/69, Shivaji Nagar, Vs. Bhopal Bhopal (Appellant) (Respondent ) PAN No.AKGPJ5075N Revenue by Shri Rajiv Jain, Sr. DR Assessee by Shri Ashish Goyal & N.D. Patwa, Advocates Date of Hearing 11.7.2018 Date of 26.7.2018 Pronouncement

O R D E R PER MANISH BORAD, AM.

This appeal filed by the assessee pertaining to the A.Y. 2010-

11 is directed against the order of ld. Commissioner of Income-tax

(Appeals)-I, Bhopal dated 29.09.2014 which is arising out of the

order u/s 143(3) of the Income Tax Act dated 04.02.2013 passed by

ITO-1(1), Bhopal.

assessee is an individual earning income from tutions and other

sources. Income of Rs.1,56,190/- declared in the income tax return

submitted on 26.7.2010. The case selected for scrutiny through

CASS. Necessary notices u/s 143(2) and 142(1) of the Income Tax

Act were duly served upon the assessee. The Ld.A.O on the basis of

information received from AIR observed that in the saving bank

account held by the assessee in State Bank of India cash of

Rs.40,74,200/- was deposited on various dates. Information

pertaining to these was called for from the assessee. It was

submitted that out of above referred cash deposit, sum of

Rs.20,00,000/- each were received from Shri L.N. Patidar and Shri

Jeetmal Patidar as advance against agreement for sale of land. The

Ld.A.O called both the persons who advanced the money and took

the statement and other necessary information but was not

satisfied with the creditworthiness and genuineness of the cash

credit and added the same as unexplained income u/s 68 of the

Act. In the similar fashion Ld.A.O also made addition of

Rs.6,00,000/- relating to cheque received at Rs.1,00,000/- and Rs.5,00,000/- for the source of which the assessee could not

provide necessary explanation. He also made addition of

undisclosed commission of Rs.5,600/- and assessed income at

Rs.47,61,790/-. Aggrieved preferred an appeal before CIT(A) but

failed to succeed on any of the grounds. Now the assessee is in

appeal before the Tribunal raising various grounds which stands

adjudicated in the forthcoming paragraphs.

submissions and paper book filed before us. The Ld. Departmental

Representative supported the findings of the lower authorities.

placed before us carefully.

Ground No.1:

That on the facts and in the circumstances of the case, the learned Commissioner of Income Tax (Appeals) erred in confirming the addition of Rs.40,00,000/- being amount deposited in the bank in the form of cash without accepting the explanation offered by the appellant and without appreciating the fact that the aforesaid cash deposit was out of proceeds of agreement to sale of the land with Shri Laxmi Narayan Patidar and Shri Jeetmal Patidar who has given the cash of Rs.20,00,000/- each and necessary evidences in this regard has already been submitted. Further, the Learned CIT (Appeals) also erred in not giving any findings that the said amount of Rs.40,00,000/- deposited in bank is not out of unsecured loans taken by the appellant but is an advance against the sale of property and hence, provision of section 68 of the Income-tax Act is applicable. 5. Grievances of the assessee through this ground is that the

Ld.CIT(A) had failed to accept his contentions that the source of

Rs.40,00,000/- was well explained and the Ld.A.O erred in making

the additions u/s 68 of the Act. We observe that during the

assessment year the assessee entered into an agreement for

purchase of agriculture land at Gram Misrod from Shri Bhojraj

Patidar vide agreement dated 17.11.2009. The assessee paid

cheque of Rs.40,00,000/- which was cleared on 25.11.2009 as

advance for purchase of agriculture land. On the same date i.e.

25.11.2009, the assessee agreed to sale agriculture land to Shri

L.N. Patidar and Jeetmal Patidar on an agreement written on plain

paper and received cash of Rs.20,00,000/- each from both these

persons. This cash was deposited in bank which facilitated in

clearing the cheque of Rs.40,00,000/- issued to Shri Bhojraj Patidar. There is no dispute before us about the sale and purchase

consideration of the agriculture land. The only issue before us is

about the genuineness and creditworthiness of the alleged cash of

Rs.40,00,000/- received from Shri L.N. Patidar and Shri Jeetmal

Patidar of Rs.20,00,000/- each. The assessee in order to get away

from the clutches of Section 68 of the Act needs to prove the

identity, genuineness and creditworthiness of the cash credited.

appeared in person before the Assessing Officer and gave statement

on oath to have given cash advance to the assessee.

that the cash creditors are regularly assessed to tax as they have

stated before the revenue authorities confirming the transaction of

giving the advances in cash of Rs.20,00,000/- each to the assessee.

The financial statements of the creditors further reveals that the

advances given to the assessee are reflected in their balance sheet.

The source of cash with these two cash creditors was alleged to

have been received from loans from their relatives which in the case

of Shri L.N. Patidar was loan of Rs.8,00,000/- from Asha Devi, 5 Rs.4,00,000/- from Manmohan Patidar and Rs.8,00,000/- from

own savings. Whereas in case of Shri Jeetmal Patidar the source of

cash was explained to have been received as loan of Rs.15,50,000/-

from Krishna Mohan, Rs.50,000/- from Geeta Devi Patidar

Rs.1,80,000/- from Murli Patidar and Rs.2,20,000/- from own

savings. It is pertinent to note that the assessee in order to to

explain source of source has placed copy of income tax returns and

balance sheet and confirmation letters of Asha Devi, Manmohan

Patidar, Krishna Mohan, Geeta Devi and Murli Patidar and all these

alleged loans received by two cash creditors from various persons

and duly reflected in their balance sheets.

the assessee has paid back Rs.12,50,000/- each by cheque to Shri

L.N. Patidar and Jeetmal Patidar on 17.07.2010 and 15.07.2010

respectively and the balance has been paid in cash. These

transactions on repayment of advances has occurred much before

the initiation of assessment proceedings which gives due weightage

in favour of the assessee of proving the genuineness of the

transaction.

successfully proved the genuineness and creditworthiness of both

the cash creditors and in the given facts and given circumstances of

the case the Ld.A.O was not justified in making addition u/s 68 of

the Act. Our view find support by the judgments in the case of CIT

vs Daulat Ramatmull 87 ITR 349 (Supreme Court), CIT vs

Navedram Ahuja 290 ITR 453 (MP).

no addition was called for u/s 68 of the Act for sum of

Rs.40,00,000/- received by the assessee against agreement for sale

of land. Ground No.1 of the appeal is allowed.

Ground No.2:

“ That on the facts and in the circumstances of the case, the Learned Commissioner of Income Tax (Appeals) erred in confirming the addition of Rs.6,00,000/- being cheque of Rs.1,00,000/- and of Rs.5,00,000/- deposited in the bank without accepting the fact that both the cheques are loan received from different persons for which necessary explanation has been given.

not to press this ground. This ground therefore is dismissed as not

pressed.

Ground No.3:

That on the fact and in the circumstances of the case, the learned Commissioner of Income Tax (Appeals) erred in confirming the addition of Rs.5,600/- being commission received on the basis of information as provided in form 26AS without accepting the explanation offered by the assessee that he has not received any such commission. 12. At the outset the Ld.Counsel for the assessee conceeded to the

fact that the alleged commission income of Rs.5600/- has not been

disclosed in the income tax return and the same has been rightly

added, however he requested that the credit of tax deducted at

source on this amount which is reflected in Form 26AS may be

given to the assessee. No objection was raised by the Ld.

Departmental Counsel.

considered the facts and records placed before us. The alleged

amount of undisclosed commission income Rs.5600/- is not in

dispute from both the side and only request is to give credit of TDS as per form 26AS . We therefore directed the Assessing Officer to

give credit of tax deducted at source on the alleged commission

income which is reflected in Form 26AS. We accordingly confirm

the addition of Rs.5600/- with direction to the Assessing Officer for

giving the credit to the Income Tax deducted at source on

undisclosed commission income of Rs.5600/-. This ground of

assessee is dismissed.

Ground No.4 & 5:

needs no adjudication.

The order pronounced in the open Court on 26.7.2018.

Sd/- Sd/-

( KUL BHARAT) (MANISH BORAD) JUDICIAL MEMBER ACCOUNTANT MEMBER �दनांक /Dated : 26 July, 2018 /Dev 9 Copy to: The Appellant/Respondent/CIT concerned/CIT(A) concerned/ DR, ITAT, Indore/Guard file. By order Private Secretary/DDO, Indore