DEVENDRA KUMAR MEENA,JAIPUR vs. ITO, JAIPUR

PER BHAGCHAND, AM Both these appeals have been filed by the assessee against separate orders of the ld. CIT(A)-2, Jaipur dated 16-03-2015 and 28-12-2015 for the assessment years 2006-07 and 2008-09 respectively raising therein following grounds:- ITA No. 436/JP/2015 –A.Y.2006-07 1. Under the facts and circumstances of the case, the ld. CIT(A) is not justified in not admitting the additional evidences submitted by the assessee u/r 46A of I.T. Rules, 1962.

ITA No. 436/JP/2015 Shri Devendra Kumar Meena vs ITO, Ward- 6(3),Jaipur 2. Under the facts and circumstances of the case, the ld. CIT(A) is not justified in not confirming the addition of Rs. 33,14,000/- against that of Rs. 36,14,000/- made by the AO towards cash deposits into the bank and payment made for purchase of land, holding the same as unexplained investment u/s 69 of the Act.

ITA No. 219/JP/2016 –A.Y.2007-08

2.1 First of all, the appeal of the assessee in ITA No.436/JP/2015 for the

Assessment Year 2006-07 is taken up for adjudication.

3.1 During the course of hearing, the ld.AR of the assessee has not pressed the

Ground No. 3. Hence, the same is dismissed being not pressed.

4.1 Apropos Ground No. 1 and 2 of the assessee, the facts as emerges from the

order of the ld. CIT(A) is as under:-

‘’3.6 I have perused the facts of the case, the assessment order and the submissions of the appellant. The appellant has made cash deposits in his bank account of Rs. 21,50,000/- during the year and has also made cash payment of Rs. 14,64,000/- for purchase of agricultural land, during the year. The appellant has 2

ITA No. 436/JP/2015 Shri Devendra Kumar Meena vs ITO, Ward- 6(3),Jaipur

stated that the source of above cash deposits in bank and cash payment of agricultural land is (a) agricultural income and advances recovered of Rs. 20,00,000/-; and (b) bank withdrawals of Rs. 17,50,000/-.

4.1 As regards, these bank withdrawals of Rs. 17,50,000/- made by the appellant in F.Y. 2005-06, it was seen that these withdrawals have been made by cheque which cannot prima facie explain cash deposits in the bank account or cash payments for purchase of land. During assessment proceedings, it was stated by the assessee that these withdrawals made by cheques were given to land owners as advances for purchase of land which was subsequently received back in cash from them on cancellation of agreement. The Assessing Officer has rightly pointed out in the assessment order that no evidences have been given by the assessee in support of this contention. It is to be noted that even basic details like name and addresses of the persons to whom advances have been given by cheque, were not furnished during assessment proceedings. During appellate proceedings, it was stated that the above bank withdrawals through cheque were given as advance, amounting to Rs. 12,50,000/-, for purchase of three plots of land. In support thereof, the appellant submitted additional evidences in the form of agreements and subsequent cancellation agreements for two plots of land for which advance of Rs. 8,50,000/- had been given. With respect to the third plot of land, no documentary evidence was furnished, however name and address of the concerned persons was given.

4.2 With respect to the admissibility of the additional evidence submitted during appeal proceedings, as discussed above, I do not agree with the contention of the appellant that sufficient opportunity was not given during assessment proceedings. The assessee was asked to explain the source of cash deposits and cash payments vide notice dated 30.07.2013, in response to which the assessee filed replies dated 25.11.2013, 05.12.2013 etc. leading to finalization of assessment only on 20.02.2014. From the above it can be seen that sufficient opportunities were given to the assessee to adduce necessary evidences to discharge his onus u/s. 69 of the I.T. Act. However, the assessee did not submit even the basic and bare minimum details in the form of names and addresses of the persons to whom the advances had been given. In view of the above discussion, it is held that the appellant was not prevented by sufficient cause from producing before the Assessing Officer, evidences relevant to the above grounds of appeal. Therefore, the application for admission of additional evidences under Rule 46A is not accepted and the additional evidences are not admitted.

ITA No. 436/JP/2015 Shri Devendra Kumar Meena vs ITO, Ward- 6(3),Jaipur

4.3 Even otherwise, the additional evidences submitted by the appellant do not have evidentiary value since the persons, to whom advances are said to have been given, were witnesses of the appellant, but he was unable to produce them in spite of being specifically asked by the Assessing Officer to do so, during remand proceedings. During inquiries made by the Assessing Officer, it was seen that one of the persons (Phoola Devi) to whom advance of Rs. 5,00,000/- was given, was not existing at the address given by the appellant. Thus, during appeal proceedings satisfactory explanation with respect to bank withdrawals of Rs. 12,50,000/- has not been furnished by the appellant. The appellant has relied on the judgement in the case of Orissa Corporation Pvt. Ltd. 159 ITR 78 (SC) to support his case. However, the facts of the appellant’s case are different from the case law cited in so far as in the case law cited - (a) names & addresses of the alleged creditors had been submitted. In the appellant’s case, names & addresses were not submitted during assessment proceedings and the additional evidences submitted during appeal proceedings have not been admitted. Furthermore, it was seen during remand proceedings that the names & addresses of some of these persons who had returned back the advance in cash were false, (b) PAN / GIR no. of the alleged creditors had been submitted in the case law cited above. However, in the instant case, no PAN / GIR no. have been submitted. Therefore, the ratio of the above case law cannot be applied in this case. Hence, the explanation of the assessee regarding source, to the extent of Rs. 12,50,000/-, to be out of advances, by cheque to land owners, returned back in cash, cannot be accepted.

4.4 With respect to the explanation regarding the balance bank withdrawals by cheque of Rs. 5,00,000/-, it has been stated by the appellant that the earlier bank withdrawals by cheque had been given to friends / relatives which have been returned back in cash. Here again, the appellant has not submitted even the basic details regarding names & addresses of the persons to whom these advances had been given. Therefore, this explanation of the appellant is not substantiated or backed by any evidence whatsoever and is therefore, not satisfactory.

4.5 Therefore, in view of the above discussion, the explanation furnished by the appellant with regard to bank withdrawals of Rs. 17,50,000/- is not satisfactory and cannot be accepted.

5.1 It has been stated by the appellant that he had entered into an agreement to purchase 16 bighas of agricultural land in the year 2003, from which he has generated agricultural income. The Assessing Officer has rejected this explanation

ITA No. 436/JP/2015 Shri Devendra Kumar Meena vs ITO, Ward- 6(3),Jaipur

of the assessee on the following grounds-

a. No khatoni has been produced by the assessee. b. Even khasra girdwari has not been produced which would show the crops grown by the assessee. c. No details have been furnished regarding the crops grown, and expenditure incurred on seeds, fertilizers etc. No evidence of carrying out basic agricultural operations, have been submitted. d. No agricultural income has been disclosed by the assessee in the returns of income filed. e. The sale bills of agricultural produce submitted by the assessee pertain to subsequent years and no sale bills pertain to the year under consideration or the preceding years.

5.2 The appellant has not been able to controvert the above grounds, raised by the Assessing Officer for rejecting the agricultural income. The only contention of the appellant is that he owns agricultural land purchased through a sale deed (submitted before the Assessing Officer) and therefore, it cannot be disputed that he is engaged in agriculture. The appellant has also cited the case of his father - Shri Kalu Ram Meena, where on similar facts of agricultural land holding of 8 bighas, the Assessing Officer has accepted the explanation of the assessee with regard to agricultural income, to the tune of Rs. 1,90,000/'-. Looking to the facts that the appellant has not submitted any evidence with respect to agricultural income, during this year or the preceding years except for the agreement to purchase 16 bighas of agricultural land in 2003, as also the facts in the case of Kalu Ram Meena, the explanation of the appellant with respect to agricultural income can be accepted only to the tune of Rs. 3,00,000/- based on a liberal estimation of agricultural income. Regarding the explanation that the source of the balance amount of bank deposits and cash payments is out of other income and return of old loans, the same is not acceptable as no basic details whatsoever about the nature of other income and names & addresses of the persons to whom these advances had been given, have been furnished by the assessee either during assessment proceedings or appeal proceedings.

ITA No. 436/JP/2015 Shri Devendra Kumar Meena vs ITO, Ward- 6(3),Jaipur

4.2 During the course of hearing, the ld.AR of the assessee prayed for deletion

of addition confirmed by the ld. CIT(A) for which the ld.AR of the assessee filed

the following written submission.

‘’Ground No.1 &2 : 1.The AO during the course of assessment proceedings observed that assessee has made cash deposits of Rs.2150000/- in his bank account and made cash payment of Rs.1464000/- on 18.03.2006 for purchase of agriculture land at Village Gunawata, Tehsil Amer. (Page No.3 of the assessment order.) 2.The assessee vide his letter dated 25.11.2013 (PB No. 12-14) explained before the AO that the relevant deposits in to the bank accounts and cash payment for purchase of land have been made out of earlier withdrawals from the Bank of Rs.1750000/- and agricultural income/ recovery of old loans of Rs.2000000/-. 3.The assessee submitted date wise details of Bank withdrawals of Rs.1750000/- (Para-4 on page No.3 of the assessment order). 4. The assessee further vide letter dated 05.12.2003 (PB No.15) explained that the relevant cheques of withdrawals have been issued in favour of certain land owners as advance and latter on relevant agreements have been cancelled, in such cases the cash received towards refund of advance has been deposited in to the bank. 5. The AO rejected the plea of the assessee in respect of the earlier Bank withdrawal on the ground: (Para (f) on page No.7 of the assessment order) (i) that the same have been made through cheques and the assessee might have utilized the same for other purposes. (ii) No details or evidences in respect of such claim of the assessee have been tendered during the course of assessment proceedings. 6. The assessee during the course of appellate proceedings submitted the details of withdrawals to the extent of Rs.1250000/- and copy of relevant agreements /cancellation agreements along with application for admission of additional evidence under rule 46 of IT Rules 1962 (PB No.16-18): (i) Agreement dated 20.04.2005 with Phoola Devi along with it’s cancellation endorsement on 20.12.2005.(PB No.19-26)

ITA No. 436/JP/2015 Shri Devendra Kumar Meena vs ITO, Ward- 6(3),Jaipur

(ii) Cancellation agreement dated 05.01.2006 with Ram Phool and others (PB No.27). Date Ch. No. Payee/Purpose Amount Date of Date of cancellation cash of deposited agreement/ in bank receipt of cash back 27.04.05 126751 Phoola Devi w/o Laduram, 500000/- 20.12.05 31.12.05 village-Luniawash, Tehsil Sanganer, Jaipur, Agreement for purchase of land 14.10.05 126760, Ramphool, Lala, Rawan, 350000/- 05.01.06 10.01.06 Nanda and Prabhati, 126762 Village Kacherawala, Tehsil Amer , Jaipur, 126763 Rs.70000/- each. Agreement for purchase of land 15.02.06 126769 Ramchandra, Jagdish, 400000/- The amount 23.03.06 Ramkaran and Kaushlya received Devi, Village- Gunawata, back, Tehsil Amer Jaipur without any Rs.200000*2 written agreement. TOTAL 1250000/-

ITA No. 436/JP/2015 Shri Devendra Kumar Meena vs ITO, Ward- 6(3),Jaipur

ii) The assessee during the remand proceedings has not produced the relevant persons for their personal examination. 8. The assessee vide rejoinder dated 04.12.2014 (PB No.32-33) requested for admission of additional evidences and to accept the relevant claim of the assessee. 9. The ld. CIT (A) rejected the application for admission of additional evidences on the same ground as taken by the AO and also rejected the relevant explanation of the assessee. 10. The assessee during the course of remand proceedings himself requested for issuing summons and the same were duly served to the respective parties at the given addresses except Smt. Phoola Devi whose summon could not be served due to her death. 11. The assessee by submitting the documentary evidences in support of his claim has discharged the burden lying upon him in respect of the refund of relevant advances of Rs.1250000/- and the AO has not disproved the same. 12.The assessee cannot be blamed for non compliance of summons by the witnesses and claim of the assessee cannot be rejected on the same ground. 13.The AO has not brought anything on record to prove that the cheques of relevant amount were issued for any other purpose and the amount thereof has not been returned in cash as claimed by the assessee. 14. It has been held by Hon. Supreme Court in CIT v. Orissa Corporation Pvt Ltd., that “ In this case the assessee had given the names and addresses of the alleged creditors. It was in the knowledge of the revenue that the said creditors were the income-tax assessees. Their index number was in the file of the revenue. The revenue, apart from issuing notices under section 131 at the instance of the assessee, did not pursue the matter further. The revenue did not examine the source of income of the said alleged creditors to find out whether they were credit-worthy or were such who could advance the alleged loans. There was no effort made to pursue the so-called alleged creditors. In those circumstances, the assessee could not do any further. In the premises, if the Tribunal came to the conclusion that the assessee has discharged the burden that lay on him then it could not be said that such a conclusion was unreasonable or perverse or based on no evidence. If the conclusion is based on some evidence on which a conclusion could be arrived at, no question of law as such arises.” 15.This is apparent from the relevant details that there is a direct nexus between the amount and date of cancellation agreement with that of the cash deposits in to the bank and thereby it is duly established that that the amount withdrawn from bank of Rs.1250000/- as mentioned above has been utilized for re depositing the same in to bank account of the assessee. 8

ITA No. 436/JP/2015 Shri Devendra Kumar Meena vs ITO, Ward- 6(3),Jaipur

16.The amount withdrawn from bank vide Ch. No.126768 of Rs.500000/-on 02.01.2006, was initially paid as loan to some friend/relative which was received back in cash and the same has been utilized by the assessee for making cash payment towards purchase of land on 18.03.2006.The assessee in spite of his best efforts could not collect the details from his bank account about the initial payee to whom the loan/advance was given. 17. Therefore the relevant claim of the assessee that the earlier withdrawals of Rs.1750000/- from the bank have been utilized for cash deposits in to the bank, may kindly be accepted and the relevant addition sustained by ld. CIT(A) may kindly be deleted. ‘’

4.3 On the other hand, the ld. DR supported the order of the AO. 4.4 I have heard the rival contentions and perused the materials available on

record. The AO found that the assessee during the relevant previous year has made

cash deposits of Rs.21,50,000/-in his bank account and made cash payment of

Rs.14,64,000/-for purchase of certain land. The assessee submitted cash flow

statement before the AO showing cash inflow of Rs.37.50 lakhs for making such

cash deposits/payments. The assessee claimed earlier bank withdrawals of

Rs.17.50 lakhs and agriculture/other income and recovery of advances of

Rs.20.00lakhs. The assessee vide letter dated 05.12.2013 placed at PB page no.15,

explained in respect of bank withdrawals that the cheques have been given to land

owners as advance and latter on the agreements have been cancelled, in such

cases cash received by the assessee has been deposited in his bank account. The

AO in the absence of any specific details rejected explanation of the assessee and

ITA No. 436/JP/2015 Shri Devendra Kumar Meena vs ITO, Ward- 6(3),Jaipur held the cash deposit/payment as unexplained and made addition of the same to

returned income. The assessee submitted copy of certain agreements/details before

ld. CIT(A) as additional evidences in support of his claim of refund of advances of

Rs.12,50,000/- on cancellation of relevant agreements. The ld.CIT(A) after

obtaining remand report of the AO did not admit the additional evidences and

rejected explanation of the assessee on the ground that sufficient opportunities

were given in assessment proceedings to adduce the evidences and the assessee

during the remand proceedings could not produce the persons before the AO to

whom advances were given. However the ld. CIT(A) after allowing claim of

agriculture income of Rs.3,00,000/- sustained addition to the extent of

Rs.33,14, 000/-. The ld.AR reiterated on the application filed before ld. CIT(A) u/r

46A of IT Rules 1962 placed at P.B. page no.16-18 and submitted that the

additional evidences filed before the ld. CIT(A) are relevant for disposal of the

claim of the assessee. Therefore ld. CIT(A) is not justified in not admitting the

additional evidences as to claim of the assessee. The ld.AR further submitted that

the receipt of cash of Rs.12,50,000/-is evident from the cancellation agreements

placed at PB page No.19-27 and details mentioned in application u/r 46A . It is

evident from the agreement dated 20.04.2005 placed at PB page No.19-26, that the

assessee paid advance of Rs.5,00,000/- to Phooli Devi vide Ch No.126751 and as

per endorsement dated 20.12.2005 (PB Page No.26) the said agreement was

ITA No. 436/JP/2015 Shri Devendra Kumar Meena vs ITO, Ward- 6(3),Jaipur cancelled and the advance of Rs.5,00,000/-was refunded to the assessee by way of

cash payment. It is also evident from the another agreement dated 05.01.2006

placed at PB page No.27 that the advance of Rs.3,50,000/-paid to Ram Phool and

others was cancelled and the advance of Rs.3,50,000/- was refunded to the

assessee by way of cash payment. The assessee has filed details of another advance

of Rs.4,00,000/-paid to Ram Chandra and others vide Ch. No.126769 which was

also refunded to the assessee by way of cash payment (PBP-11). The assessee has

provided necessary details in support of his claim and the AO in remand

proceedings has neither doubted the genuineness of the relevant agreements/details

nor given any contradictory finding. The claim of the assessee duly supported by

documentary evidences cannot be rejected simply for the reason that the assessee

could not produce the witnesses personally that too after lapse of several years

from the relevant point of time. Therefore ld. CIT(A) is not justified in not

admitted the additional evidences and in rejecting the explanation of the assessee

to the extent of Rs.12,50,000/-relating to refund of advances on cancellation of

relevant agreements. As transpired from the record, the assessee apart from his

explanation to the extent of Rs.12,50,000/-, has not submitted any other

details/evidences. Thus under the totality of facts and circumstances of the case,

the addition of Rs.12,50,000/- is hereby deleted and the balance addition of

Rs.20,64,000/-is sustained.

ITA No. 436/JP/2015 Shri Devendra Kumar Meena vs ITO, Ward- 6(3),Jaipur 5.1 During the course of hearing, the ld.AR of the assessee has not pressed the

Ground No. 3.Hence, the same is dismissed being not pressed.

6.0 In the result, the appeal of the assessee is partly allowed.

7.1 Now the appeal of the assessee in ITA No. 219/JP/2016 for the Assessment

Year 2007-08 is taken up for adjudication wherein the assessee has raised the

following ground of appeal.

‘’Under the facts and circumstances of the case, the ld. CIT(A) is not justified in not justified in confirming the addition of Rs. 25,56,440/- as unexplained investment u/s 69 of the I.T. Act, 1961 towards cash deposited into the bank and payment made for purchase of agriculture land.’’

8.1 Apropos solitary ground of the assessee, the facts as emerges from the order

of the ld. CIT(A) is as under:-

‘’3.3 I have perused the facts of the case, the assessment order and the submission of the appellant. The appellant had made cash deposit of Rs.9,20,000/- in the saving banks accounts in SBI, Tonk Road, Jaipur and also made cash payment of Rs 19,29,960/- for purchase of land at Gunewata. In response to notice u/s 148, the assessee has requested that the original return filed may be taken as return filed in response to notice under section 148. The appellant has stated that the source of above cash deposits and cash payment of agricultural land is from agricultural income and advances received for sale of agricultural land. Explanation regarding source of Rs.30 lacs for investment and purchase of land, the assessee claimed that an amount of Rs.30 lacs has been received for an agreement to sale dated 25.07.2006 from Smt. Diwan Solanki, Shri Suresh Solanki and Shri Rakesh Solanki resident of Palam Village, Delhi. In support of the transactions, Shri Suresh Solanki and Diwan Solanki were produced as wittiness for this transaction. It was noticed by the Assessing Officer that the value of land as per this agreement was taken at Rs.30 lacs per bighas whereas in another agreement dated 30.11.2006, relating to land situated

ITA No. 436/JP/2015 Shri Devendra Kumar Meena vs ITO, Ward- 6(3),Jaipur

close to this land, the rate have been taken at Rs.5 Lacs per bigha. The Assessing Officer was not convinced as the assessee could not explain the huge difference in price for similar land. Further Shri Suresh Solanki and Rakesh Solanki when produced before the Assessing Officer, agreed to advancing in cash but did not present any sources for this cash. The bank accounts of these people also did not show enough cash and their income tax return have been filed for a low income of Rs.1,28,000/- and Rs. 1,28,000/- respectively and the balance sheet and other papers were not produced. Further, while Shri Suresh Solanki appearing on behalf of Shri Diwan Solanki, stated that he has received back the cash amount of Rs.20 lacs, Shri Rakesh Solanki stated that the same had not been received. Thus, there was contradiction in the statement of the parties who had signed the agreement. Further it is seen that even after eleven years, the agreement has not been concluded and the amounts have not been returned and the assessee could produce no evidence in this regard.

It is further seen, that the assessee has deposited Rs.9,20,000/-in cash in the Bank. The source for this amount was explained as the advance of Rs.30 lacs taken for agreement to sell the land. The Assessing Officer has opined that if it was so, the amount would have been deposited in the same date in the bank on which they were received. Further as already discussed in earlier paras, the theory of advance received for land could not be proved and has not been accepted. Due to the above reasons and contradictions, the transactions cannot be accepted and have not been supported by evidences by the assessee in spite of several opportunities in the appellant proceedings also. The assessee has simply reiterated the facts, as stated in assessment proceedings. It was not enough to prove the identity of the parties to the agreement and since they were not found to have the means to advance such amounts, the same cannot be accepted. Hence the explanation of the assessee that these amounts related to advances received for sale of land cannot be accepted.

Claim for agricultural income of Rs.2,93,520/-. With regards to this, the assessee has stated that he alongwith his brother and mother have purchased the property for Rs.30 lacs and the same is being used for agriculture. As evidence of the same, he produced some purchase bills of the produce and girdawari of the agricultural land. The Assessing Officer did not accept the claim of agricultural income because no such claim had been made by the assessee either in the original return of income filed nor in the return filed in response to notice u/s 148. Secondly, the Assessing Officer found that this land had not been registered in the name of the assessee even after eleven years of the transaction. Further, the assessee would have been 20 years of age at that time and hence would not had the requisite sources to purchase the land.

The appellant has not been able to controvert the above findings of the Assessing Officer for rejecting the agricultural income. The only contention of

ITA No. 436/JP/2015 Shri Devendra Kumar Meena vs ITO, Ward- 6(3),Jaipur

the assessee is that he owns agricultural land which is evidenced by the purchase deed. The appellant has also cited the case of his farther Shri Kalu Ram Meena where on similar facts of agricultural land holding of eight bighas, the Assessing Officer has accepted explanation of the assessee with regard to agricultural income to the tune of Rs. 1,19,000/- . Further, in the previous year, the A.Y. 2006-07, my predecessor, the CIT(A)-2 vide order dated 16.03.2015 had accepted agricultural income of an amount of Rs. 3.00 lacs. in view of the above, the claim of the assessee regarding the agricultural income of Rs. 2,93,520/- is accepted.

Since, the transactions of cash deposit and cash payment for purchase of land could not be explained by the assessee, the amounts reflected as received would be its unexplained income and applicability of any particular section would be in consequential Reliance is placed on 41 taxmann.com123 (Mumbai - Trib.) in the case of Alliance Hotels vs. Assistant Commissioner of Income Tax -12(1). In the present case, the above ratio applies squarely. Since the amounts reflect investments, the same are being added u/s 69 of the I.T. Act.

The Assessing Officer has added an amount of Rs.30,00,000/- under section 68 as unexplained investment. However ,in view of the above discussion, the section for unexplained investment would be section 69, the addition is considered to be made under section 69 of the I.T. Act.

It is seen that the unexplained investments are of an amount of Rs.9,20,000/- which were the cash deposits in the Bank and Rs. 19,29,960/- for unexplained investment made in cash for purchase of land at Gurnavata, totalling to Rs.28,49,960/-. The Assessing Officer has added the entire sum of Rs.30,00,000/- which the assessee claimed to have received as advance and to explain the source for cash deposits and cash payment for purchase of land. Since, these two components are for a sum of Rs.28,49,960/-, the addition u/s 69 of the I.T. Act 1961, is restricted to this amount. Further, since agricultural income has been accepted to the tune of Rs.2,93,520/-, such further credit will be given and the thus addition u/s 69 of the I.T. Act is restricted to Rs.25,56,440/- (Rs.28,49,960 - Rs.2,93,520).’’

8.2 During the course of hearing the ld.AR of the assessee prayed for deletion of

addition confirmed by the ld. CIT(A) for which the assessee has filed the

following written submission.

ITA No. 436/JP/2015 Shri Devendra Kumar Meena vs ITO, Ward- 6(3),Jaipur

‘’Ground No.1 : 1.The AO during the course of assessment proceedings observed that the assessee has made the cash deposits in his bank account and also made cash payments for purchase of agriculture land at Village Gunawata, Tehsil Amer, Jaipur as follows: Date Cash Deposits Cash Total in Bank payment for purchase of land 10.07.2006 320000/- 320000/- 31.07.2006 310000/- 310000/- 07.10.2006 400000/- 400000/- 30.11.2006 1930960/- 1930960/- 02.12.2006 210000/- 210000/- Total 1240000/- 1930960/- 3170960/- (Para 2 (ii) on Page No.2 of the assessment order.) 2.The assessee vide his letter dated 24.12.2014 (PB No.20-21) explained before the AO that the relevant deposits in to the bank accounts and cash payment towards purchase of land have been made out of the advance received against sale of land of Rs. 3000000/- and other Income of Rs.391000/-. 3.The assessee in support of his claim submitted copy of agreement dated 25.07.2006 ( PB No.22-24) executed between the assessee and (i) Smt. Deewan Solanki w/o Shri Ramesh Solanki (ii) Shri Suresh Solanki s/o Shri Nand Ram Solanki and (iii) Rakesh Solanki s/o Shri Dalel Singh Solanki, for sale of his agriculture land at Village Gunawata evidencing receipt of Rs.3000000/- as advance towards the same and certain sales slips of agriculture produce. 4. The assessee has produced before the AO Shri Suresh Solanki and Rakesh Solanki the purchasers of the land personally for their examination along with their bank statements, IT returns etc. Pan Cards etc. ( Bank statement and PAN Card of Suresh Solanki (PB No.25-27) (Bank Statement of Rakesh Solanki PB No.28-30) ( Bank statement and PAN Card of Smt. Deewan Solanki PB No.31-33)

ITA No. 436/JP/2015 Shri Devendra Kumar Meena vs ITO, Ward- 6(3),Jaipur

ITA No. 436/JP/2015 Shri Devendra Kumar Meena vs ITO, Ward- 6(3),Jaipur

(iii) the relevant transaction has not been completed even after lapse of seven years from the date of relevant agreement. Submission: The relevant land has not been converted in to residential land as undertaken by the assessee therefore the agreement dated 25.07.2006 has not been matured till date. Allegation of the AO: (iv) the assessee has deposited different amounts in his bank on different dates, had the assessee would have received the advance of Rs.300000/- it would have been deposited on single day. Submission: The assessee has deposited different amounts in his bank account on different dates as considered convenient and necessary and simply for the reason that the entire amount of Rs.3000000/- has not been deposited on single day the receipt of the same against agreement dated 25.07.2006 cannot be doubted. 12.Without prejudice to the submission cited above it is humbly submitted that even if it is assumed that the appellant could not explained the source of funds of the purchasers for paying advance for purchase of land pursuant to agreement dated 25.07.2006, the said advance paid by the purchasers of land cannot be held as unexplained simply on the basis of the same. 13. It is not the burden of the assessee to explain the source of funds of the purchasers paying advance for purchase of land. The burden lying upon the assessee u/s 68 of the Act, is to explain the source of the credit found in his books of accounts not the source of the source. If the assessee is enforced to explain the source of funds of the purchasers, it shall amount to enforce the assessee to explain the source of the source. 14.As held by Hon’ble jurisdictional high court in Labh chand Bohra vs ITO 219 CTR 571, so far as capacity of the lender is concerned, in our view on the face of the judgment of the hon’ble supreme Court in Daulat Ram’s case and other judgments , capacity of the lender to advance money to the assessee was not a matter which could be required of the assessee to be established, as that would amount to calling upon him to establish source of the source. 15. Therefore the claim of the assessee towards receipt of Rs.3000000/- as advance against sale of land vide agreement dated 25.07.2006, may kindly be accepted and the addition of Rs.2566440/-CIT(A) may kindly be deleted. ‘’ 8.3 On the other hand, the ld. DR supported the order of the ld. CIT(A).

ITA No. 436/JP/2015 Shri Devendra Kumar Meena vs ITO, Ward- 6(3),Jaipur 8.4 We have heard the rival contentions and perused the materials available on

record. The AO observed that the assessee during the relevant previous year has

made cash deposits of Rs.12,40,000/-in his bank account and made cash payment

of Rs.19,30,960/- for purchase of certain land. The assessee explained before the

AO that the relevant cash deposits into the bank accounts and cash payment

towards purchase of land have been made out of the advance received against sale

of land of Rs. 30,00,000/- and agriculture Income of Rs.2,93,520/-. The assessee

in support of his claim submitted copy of agreement dated 25.07.2006 executed

between the assessee and Smt. Deewan Solanki, Shri Suresh Solanki and Shri

Rakesh Solanki for sale of his agriculture land (PBP 22-24). The assessee also

produced Shri Suresh Solanki and Rakesh Solanki before the AO for their

examination along with their bank statements, IT returns etc. Pan Cards etc. The

AO rejected the claim of the assessee towards receipt of advance of Rs.30,00,000/-

against sale of land on the ground that the purchasers could not prove their

capacity to give such advance and genuineness of the transaction. The AO also

rejected the claim of the assessee of agriculture income and held the same as

taxable income from other sources (page 2 to 5 of assessment order). Thus the AO

made addition of agriculture income of Rs.2,93,520/-as income from other sources

and of Rs.30,00,000/-as unexplained deposit u/s 68 of the IT Act 1961. The ld.

CIT(A) after allowing claim of agriculture income of Rs.2,93,520/- sustained

ITA No. 436/JP/2015 Shri Devendra Kumar Meena vs ITO, Ward- 6(3),Jaipur addition of Rs.28,49,960/-as unexplained investment u/s 69 of the Act. The ld.AR

relied on the agreement dated 25.07.2006 placed at P.B. page no. 22-24, bank

statements, IT returns, Pan Cards etc. of the purchasers of the land placed at PB

page No.25-33.The ld.AR also relied on statements of Shri Suresh Solanki and

Rakesh Solanki referred by the AO at page No.4 of the assessment order. It is

evident from the agreement dated 25.07.2006 that the purchasers of the land paid

advance of Rs.30,00,000/- to the assessee for purchase of agriculture land of the

assessee at village Gunawata, Patwar- Labana, Tehsil-Amer, Distt-Jaipur. It is also

evident from the assessment order itself that the purchasers personally appeared

before the AO, filed their IT returns, Bank statement and PAN Cards etc and

categorically admitted that they have purchased the relevant land and paid advance

of Rs.30,00,000/-to the assessee by way of cash payment. As appears from the

transactions contained in the bank accounts of the purchasers, it cannot be said

that they have no means for paying relevant advance. There is a weight in the

submission of the ld.AR that the burden lying upon the assessee u/s 68 of the Act,

is to explain the source of funds and not the source of the source, therefore it is not

the burden of the assessee to explain the source of funds of the purchasers paying

advance for purchase of the land. The Hon’ble Jurisdictional High Court in the

case of Labh Chand Bohra vs ITO 219 CTR 571 held that so far as capacity of

the lender is concerned, in our view on the face of the judgment of the Hon’ble

ITA No. 436/JP/2015 Shri Devendra Kumar Meena vs ITO, Ward- 6(3),Jaipur Ssupreme Court in Daulat Ram’s case and other judgments , capacity of the lender to advance money to the assessee was not a matter which could be required of the assessee to be established, as that would amount to calling upon him to establish source of the source. In this view of the matter, the addition of Rs.28,49,960/- made by the lower authorities is deleted. Thus solitary ground of the assessee is allowed. 9.0 In the result, the appeal of the assessee in ITA No.436/JP/2015 is partly allowed and that of ITA No.219/JP /2016 is allowed.

Order pronounced in the open court on 27 /10/2017.

Sd/- ¼HkkxpUn½ (Bhagchand) ys[kk lnL;@Accountant Member Tk;iqj@Jaipur fnukad@Dated:- 27/10/ 2017 *Mishra आदेश की प्रतिलिपि अग्रेषित@ब्वचल वf जीम वतकमत वितूंतकमक जवरू vihykFkhZ@The Appellant- Shri Devendra Kumar Meena,Jaipur 1. 2. izR;FkhZ@ The Respondent- The ITO, Ward- 6(3), Jaipur vk;dj vk;qDr¼vihy½@ CIT(A). 3. 4. vk;dj vk;qDr@ CIT, विभागीय प्रतिनिधि] आयकर अपीलीय अधिकरण] जयपुर@क्त्ए प्ज्Aज्ए Jंपचनत 5. 6. xkMZ QkbZy@ Guard File (ITA No. 436/JP/2015 ) vkns'kkuqlkj@ By order,

सहायक पंजीकार@ Aेेपेजंदज. त्महपेजतंत