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Income Tax Appellate Tribunal, DELHI BENCH ‘SMC-2’, NEW DELHI
Before: SH. N. K. BILLAIYA
This appeal by the assessee is preferred against the order of the CIT(A), Hisar dated 21.02.2019 pertaining to A.Y. 2010-11.
2. The substantive grievance of the assessee read as under :-
1. That the Ld. Assessing Officer has wrongly assumed the jurisdiction with regard to reopening of the case u/s. 148 as there was no reason to believe that the income of the assessee is escaped income assessment and further,
there was no independent application of mind by the Assessing Officer concerned with regard to reopening of the case and, as such, the assessment as reopened u/s. 148 is bad in law. 2. Notwithstanding the above said ground of appeal
, the Ld. CIT(A) as erred in confirming the addition of Rs.18,70,000/- on account of amount received from certain parties as advance against the purchase of the agricultural land.
3. That the Ld. CIT(A) has failed to appreciate the fact that all the persons concerned had confirmed such payment having been made to the appellant and, thus, the addition as confirmed is against the facts and circumstances of the case.
4. That the ld. CIT(A) has also failed to appreciate the fact that no addition could be made u/s. 68 since the amount received have been deposited in the bank account of the assessee and had not been recorded in the books of accounts of the assessee.
Briefly stated the facts of the case are that on the basis of the information available on AST system the AO issued a notice u/s. 148 of the Act and initiated the reassessment proceedings.
The assessee did not file any return in response to the notice but attended the assessment proceedings wherein he was asked to furnish the statements of all bank accounts alongwith source of cash deposits in bank accounts with documentary evidences.
The AO found that as per information the assessee has deposited cash of Rs.25.09 lacs but on perusal of bank statement found the total deposits in cash at Rs.28.90 lacs. The assessee explained that during the year he had been doing business of sale of reti, rodi and crushers where total turnover was approximately Rs.10 lacs. The assessee explained that he has filed return u/s. 44AD of the Act. In support of his claim the assessee furnished copies of various purchase bills from various Stone crushers. The AO made enquiries and was convinced with this reply of the assessee.
Now, the assessee was asked to explain the source of cash deposit to the extent of Rs.18.70 lacs. The assessee explained four persons approached him and were interested in purchase of agricultural land of his family who have advanced him the amount which was deposited in the bank account and which return back as the deal could not be matured. In support of his claim the assessee produced all four persons for verification and the AO recorded the statements of all the four persons who in their respective statements affirmed of having given money to the assessee.
The AO did not accept the contentions of the assessee nor those of the persons and made addition of Rs.18.70 lacs u/s. 68 of the Act.
Assessee strongly agitated the matter before the CIT(A) but without any success.
Before me the counsel for the assessee fairly conceded that he is not pressing the grounds challenging the reopening of the assessment. On such concession ground No.1 is dismissed. On merits of the case the counsel vehemently stated that the assessee has discharged the onus cast upon him by the provisions of section 68 of the Act and, therefore, no addition is to be made u/s. 68 of the Act.
Per contra the DR strongly supported the findings of the AO.
I have given a thoughtful consideration to the orders of the authorities below. Facts on record show that the assessee has claimed having received advance from following persons :-
Suresh
Sushila
3. Sombir
4. Rafiq Khan
I find that all the aforementioned four persons were produced before the AO and the AO examined them by recording their statements. I further find that in their respective statements all the aforementioned persons have affirmed of having given advance to the assessee. On this undisputed fact there remains no doubt that the assessee has fully discharged the initial onus cast upon him by the provisions of section 68 of the Act. Therefore, I do not find any merit in the additions so made u/s. 68 of the IT Act. I accordingly direct the AO to delete the additions.
In the result, the appeal filed by the assessee is accordingly allowed.
Order pronounced in the open court on 13.03.2020.