SRI JAGDISH PRASAD SHARMA,NEW DELHI vs. ITO, GHAZIABAD

INCOME TAX APPELLATE TRIBUNAL DELHI BENCH “SMC +C”: NEW DELHI BEFORE SHRI PRASHANT MAHARISHI, ACCOUNTANT MEMBER AND SHRI K.N.CHARY, JUDICIAL MEMBER ITA No. 104/Del/2015 (Assessment Year: 2009-10) Sri Jagdish Prasad Sharma, Vs. ITO, C/o. Mr. Sandeep Bhatnagar, Ward-1(3), Flat No. 12, 2nd Floor, Sheel Tara Ghaziabad House, 4866/24, Ansari Road, Darya Ganj, New Delhi PAN: AZPPS2130R (Appellant) (Respondent)

Assessee by : Ms. Timsi Sharma, CA Revenue by: Ms. Rakhi Vimal, Sr. DR Date of Hearing 14/10/2019 Date of pronouncement 13/01/2020

O R D E R PER PRASHANT MAHARISHI, A. M. 1. This is an appeal filed by the assessee against the order of the ld CIT(A), Ghaziabad dated 09.10.2014 for the Assessment Year 2009-10. 2. The assessee has raised the following grounds of appeal:- “1. The Ld. Income Tax Officer has erred in arbitrarily framing assessment u/s 143(3) of the Income Tax Act, 1961, without considering the facts of the case explained and submitted to him. 2. The Ld. Income Tax Officer has erred in presuming that the persons who have advanced the money to the assessee as per the agreement to sale entered with assessee does not have sources to pay the amount. The Ld. Income Tax Officer has accepted the agreement of sale entered by the assessee with the prospective buyers in one hand and assessee has discharged his onus by producing the buyers who have advanced the money to the assessee against the purchase of his agricultural land as insisted by the Ld. Income Tax Officer. That during personal deposition of the buyers Mr. Jai Ram Nagar and Mr. Shri Chand, they have confirmed that they have paid the advance to the assessee against the purchase of his agricultural land and also explained the sources of their income. That Mr. Jai Ram Nagar has also shown his withdrawal from his bank account justifying the payment made to the assessee which was totally ignored by the Ld. Income Tax Officer on the pretext that the date of withdrawal by Mr. Jai Ram Nagar and date of deposit by the assessee does not match, whereas at no time during Page | 1

Sri Jagdish Prasad Sharma Vs. ITO ITA No. 104/Del/2015 (Assessment Year: 2009-10) his personal deposition Mr. Jai Ram Nagar has stated he has paid the amount to the assessee immediately after withdrawal from his bank account to the assessee. 3. That the assessee has discharged his onus by producing the parties with whom he has entered into agreement for sale of his agricultural land and from whom he has received the advance and deposited the same in his bank account. That by producing the buyers and confirmation from them that they have paid the amount to the assessee, sources of deposit of amount by the assessee has been fully explained and justified. That the Ld. Income Tax Officer has erred in presuming that the assessee should also explained the sources of source. 4. That the Ld. Income Tax Officer has erred in not providing the opportunity to the assessee to explain and justify his case after recording the statement of the buyers, whereas after every deposition, assessee has specifically requested to the Ld. Income Tax Officer to appraise him and also to provide the details and opportunity if any contrary observed during the personal deposition. In this manner principal of natural justice was violated by not providing any opportunity to the assessee to justify if any adverse observation has been formed against the assessee and specially when the assessee is specifically asking for the same in writing. That no copy of Statement recorded of the persons was confronted to the assessee nor was any copy of the same provided to the assessee. 5. That the assessee has also received gifts from his family members (real brothers, real sister-in-law and real nephews on the occasion of his 25th Marriage Anniversary and as desired by the Ld. Income Tax Officer, assessee has produced all the persons who have gifted the small amount to the assessee for their personal deposition. That the assessee has filed copy of gift deed , affidavit , their identity proof and sources of the amount gifted. That the Ld. Income Tax Officer has erred in presuming that the Donor(s) does not have proper and justified sources to make the gift to the assessee and presumed without any basis that the donor(s) have capacity to pay Rs.25,000/- as gift to the assessee. It was explained by the each donor about their sources of income and also confirmed the amount of gift given to the assessee. That since the occasion of the 25th Marriage ceremony of the assessee, the immediate family members have gifted a small amount of Rs. 1,00,000/- to the assessee and it was explained that the amount was paid to the assessee from the sources of their present earnings and from past savings. That the Ld. Income Tax Officer has erred in presuming that the donors who are aged about 55 and 65 years does not have capacity to store and retain small amount of Rs. 1,00,000/-. 6. That the Ld. Income Tax Officer has erred in presuming that the assessee has intentionally not made the personal deposition of his real brother Mr. Brahma Nand Sharma and his real sister-in-law Mrs. Bhagwati. That it was explained that Mr. Brahma Nand Sharma, brother of the assessee was expired on 24.04.2009 and the copy of gift Page | 2

Sri Jagdish Prasad Sharma Vs. ITO ITA No. 104/Del/2015 (Assessment Year: 2009-10) deed , affidavit of legal heir, identity proof of legal heir and the donor and sources of gift given to the assessee. That it was explained to the Ld. Income Tax Officer that the real sister in law of the assessee, Mrs. Jagwati Sharma wife of Mr. Likhiram Sharma, brother of the assessee was expired on 27.11.2011 and due to tradition in the family , elder lady Mrs. Bhagwati cannot be produced for personal deposition and requested to depute the official staff to record the statement, if necessary. That the Ld. Income Tax Officer has not taken any steps to record the statement of legal heir of late Mr. Brahmna Nand Sharma and Mrs. Bhagwati for the reasons better known to him and wrongly presumed that these persons have capacity of payment of gift of Rs.25,000/- each, totally ignoring the age of the donors , their relationship with the assessee and occasion of such gift. That Ld. Income Tax Officer has also erred in ignoring the fact that even the death in the family all the donors have presented for personal deposition and even Mr. Likhiram Sharma , brother of the assessee, whose wife was expired on 27.11.2011 was also present for his personal deposition. 7. That the Ld. Income Tax Officer has erred in not providing the opportunity to the assessee to explain and justify his case after recording the statement of the donors, whereas after every deposition, assessee has specifically requested to the Ld. Income Tax Officer to appraise him and also to provide the details and opportunity if any contrary observed during the personal deposition. In this manner principal of natural justice was violated by not providing opportunity to the assessee to justify if any adverse observation has been formed against the assessee and specially when the assessee is specifically asking for the same in writing. That no copy of Statement recorded of the donors was confronted to the assessee nor was any copy of the same provided to the assessee. 8. That during the course of assessment proceedings and even in his first submission, assessee has submitted and disclosed that he has earned Saving Bank Interest of Rs. 10,627/- and Auto Sweep Interest of Rs.2,821/- but not included in his taxable income on the presumption that the same is not taxable as the assessee has also paid Interest of Rs.49,534/- to Bank of Baroda Car Lorn Account and offered the same for taxation. However the Ld. Income Tax Officer has not only included the same but also included the Bank Interest of Rs. 10,000/- earned by his wife, Mrs. Sunita Sharma, whose bank statement was asked by the Ld. Income Tax Officer. 9. That the Ld. Income Tax Officer has erred in levying Interest U/s 234 A & U/s 234 B of the Income Tax Act,1961. 10. The Ld. Income Tax Officer has erred in presuming that the appellant company has furnished inaccurate particulars on income thus leading to concealment of income and has brought itself within the ambit of Section 271(l)(c) of the Income Tax Act, 1961.”

Sri Jagdish Prasad Sharma Vs. ITO ITA No. 104/Del/2015 (Assessment Year: 2009-10) 3. Assessee is an individual. He filed his return of income on 13/10/2009 declaring total income of ₹ 90200/–. This case of the assessee was selected for the scrutiny as assessee is deposited cash of ₹ 3792000/– in a savings bank account with Bank of Baroda, Indirapuram, Ghaziabad. The assessee was asked to explain the source of the cash deposit. Assessee tried to explain the cash deposit stating that on 19/04/2008, ₹ 1 lakh is the sum received against sale of agricultural land. Cash deposit of ₹ 1 lakh on 30/04/2008 is also an advance against the sale of agricultural land. Cash deposit of ₹ 3 lakhs on 30/4/2008 is also advanced against sale of agricultural land. Cash deposit of ₹ 5 lakhs on 5/5/2008 is also advanced against sale of agricultural land. All these advances were received from Shri Jairam Nagar. For the sum of Rs. 24,50,000/– deposited on 17/06/2008 assessee explained that ₹ 10 lakhs is out of cash withdrawn from bank on 02/06/2008 and further sum is received as advanced against sale of agricultural land, cash gift received from various persons. Other cash deposits were stated to be deposited out of the cash withdrawal made on earlier dates. The learned Assessing Officer asked the assessee to produce all those persons from whom advance against sale of agricultural land was received as well as the persons who have gifted sums to assessee. The learned Assessing Officer also recorded statement of certain persons and found that these persons are of very low means and could not have given an advance or gift to the assessee. However, the ld AO adopting the lenient view granted certain relief to the assessee and in the end made an assessment of ₹ 20,87,565/– against the returned income of the assessee of ₹ 90200/– making the balance addition on account of cash deposited with respect to several persons. Thus, assessment u/s 143(3) of the Act was passed on 27/12/2011 determining the total income of the assessee at ₹ 2087,565/-. 4. The assessee preferred appeal before the ld CIT(A) who dismissed the appeal of the assessee but also enhanced the sum by a sum of ₹ 1 lakh on account of gift received from Shri Likhi Ram Sharma, ₹ 10 lakhs on account of advances received against sale of agricultural land from Jai Ram Nagar, and Rs. 2 lakhs on account of gift received from sister of the assessee. The learned CIT(A) noted that there cannot be relief given in part to the assessee Page | 4

Sri Jagdish Prasad Sharma Vs. ITO ITA No. 104/Del/2015 (Assessment Year: 2009-10) on account of creditworthiness of the depositors/donors. Accordingly passed order on 9/10/2014 dismissing the appeal of the assessee and further making enhancements to the total income. 5. The assessee preferred appeal before us as per the ground stated hereinabove. 6. The learned authorised representative also submitted that assessee would like to raise any additional ground of appeal and therefore an application was made for admitting the additional ground of appeal relying upon the decision of the Hon’ble Supreme Court in case of National Thermal Power Co Ltd VS. CIT 229 ITR 383. Additional ground was raised as under:- “on the facts of the case and as per law, the learned CIT (A) or in upholding and enhancing the addition of rupees to 450000/– as cash credit under section 68 of the income tax act, 1961 in the returned income in respect of cash deposited into the bank account of cash received as advance for sale of land, gifts and loan duly accept accepted by the intended purchasers, donors and creditors in their statement recorded on oath before the AO during the course of assessment proceedings without appreciating that section 68 cannot be invoked where the books of accounts are not maintained by the assessee.” 7. The learned authorised representative submitted that above ground is a technical ground which can be raised at any point of time. He therefore submitted that same should be admitted. 8. The learned Departmental Representative vehemently objected the raising of the additional ground and submitted that such ground cannot be raised that it is neither a jurisdictional ground nor a ground which goes to the root of the matter. It is merely a challenge to the Assessing Officer’s action of taxing the amount deposited in the bank account in cash under Section 68 of the Income Tax Act. 9. We have carefully considered the rival contention and find that assessee can raise any additional ground of appeal which is technical in nature. As the additional ground raised by the assessee goes to the root of the matter that whether any addition can be made under section 68 of the Act in case of the assessee was not maintaining the books of accounts when the money is deposited in his bank account. In view of the decision of the Hon’ble

Sri Jagdish Prasad Sharma Vs. ITO ITA No. 104/Del/2015 (Assessment Year: 2009-10) Supreme Court in National Thermal Power Co Ltd (supra), we admit the additional ground raised by the assessee. 10. As the additional ground raised by the assessee is required to be adjudicated first, as it goes to the root of the assessment made by the learned assessing officer. On the issue of the additional ground, it was submitted that the invocation of section 68 in the present casein absence of proper books of account of the assessee is invalid. It was stated that where the assessee was not maintaining any account books, bank statement could not be construed to be books of account maintained, merely on the basis of information that the assessee made cash deposited in savings bank account addition cannot be made as unexplained cash credits under section 68 of the income tax act. The assessee relied upon the judicial precedent which are as under:- a. 103 taxman.com 274, b. 102 taxman.com 229, c. 20 taxman.com 311, d. 100 taxman.com 325, e. 33 taxman.com 610 and f. 73 taxman.com 68. 11. In view of this, it was submitted that the addition made by the learned Assessing Officer under section 68 of the income tax act is not valid. 12. Even otherwise it was submitted that once the three basic conditions of identity of persons, relationship with person, or occasion with respect to the gift are proved, there is no reason to doubt the genuineness of the gifts. The contention of the revenue that assessee has not brought any corroborative documentary evidence to prove the genuineness of the gift, is not sustainable. The gifts received by the appellant are one of gifts which either falls within the limits of section 56(2)(v) of the Act or outside the scope of said section as received from specified relatives. He relied upon the decision of Hon’ble Andhra Pradesh and Telangana High Court in 407 ITR 179 and also of the Hon’ble Delhi High Court in 57 taxman.com 84 stating that wherein, in case of gifts received from relatives no occasion need to be proved and where assessee donor has given confirmation that he had given Page | 6

Sri Jagdish Prasad Sharma Vs. ITO ITA No. 104/Del/2015 (Assessment Year: 2009-10) amount towards gift out of love and affection, AO could not have raised doubt about the capacity of donor. Hence, such amount cannot be treated as income from undisclosed sources. It was further stated that creditworthiness of the donor should not be doubted when the gift is of a meager amount of Rs. 50,000/- to Rs. 1,00,000/- where such donors are of the age of more than 35 to 60 years and earning independently for a long time. Therefore, it was submitted that the addition of Rs. 24,50,000/- on account of cash deposit in the bank account cannot be added to the income of the assessee. It was further stated that even otherwise the enhancement made by the ld CIT(A) is illegal as neither there is a notice u/s 251(2) of the Act and nor any opportunity was given. 13. The ld Departmental Representative vehemently supported the order of the lower authorities. 14. We have carefully considered the rival contentions and also perused the orders of the lower authorities. Admittedly, assessee has deposited cash of Rs. 2450000/– in the bank account of the assessee in cash. Source of the cash as explained by the stating that he has received Rs. 1,000,000/- from Mr Jayaram Nagar as advance against the sale of land, out of which the learned assessing officer has accepted the genuineness to the extent of Rs. 300,000/- and made the addition of Rs. 700,000/- as unexplained cash credit. The learned CIT(A) enhance to Rs. 1,000,000/- thereby making an enhancement to the income of the assessee of Rs. 300,000/-. Further, the assessee also explained that Rs. 1,000,000/- have been received from Mr Sri Chand, out of which the learned Assessing Officer accepted the genuineness and creditworthiness of the party to the extent of Rs. 100,000/- and made an addition of Rs. 900,000/- which was enhanced by the learned CIT(A) to Rs. 1,000,000/-. Further, with respect to Shri Likhiram Sharma where the assessee contended that he has received gift of Rs. 100,000/- and AO accepted the identity and creditworthiness to the extent of Rs. 25,000 making the addition of Rs. 7,500,000/- which was enhanced by the learned CIT(A) to Rs. 100,000/-. The assessee has also stated that it has received a loan of Rs. 100,000/- from the Dinesh Sharma which was added by the learned Assessing Officer and confirmed by the learned CIT(A). The Page | 7

Sri Jagdish Prasad Sharma Vs. ITO ITA No. 104/Del/2015 (Assessment Year: 2009-10) assessee has stated that it is also received a gift of Rs. 100,000/- each from Mr Brahmanaad and Mrs Bhgwati, the learned Assessing Officer accepted the creditworthiness of these parties to the extent of Rs. 25,000/- each and made the balance addition u/s 68 which was enhanced by the learned CIT(A) to Rs. 100,000/- each. The assessee has also stated that it has received a gift of INR 100,000 from Mr Bal kishan , AO accepted the identity and creditworthiness to the extent of Rs. 50,000/- and made the balance addition of Rs. 50,000/-. The learned CIT(A) confirmed that. Therefore, the learned assessing officer out of the cash deposit of INR 2,450,000/– made an addition of INR 1,975,000 under section 68 of the income tax act which has been enhanced by the learned CIT(A) to Rs. 2,450,000/–. 15. The 1st additional ground of appeal challenges the fact that whether cash deposit in the bank account can be added into the hands of the assessee u/s 68 of the income tax act when the assessee does not maintain the books of account. Identical issue has been decided by the coordinate bench in case of Sri Jenna Goel vs Deputy Commissioner of income tax in ITA number 937 and 98/del/2012 for assessment year 2004 – 05 and 2005 – 06 wherein it has been held as under:- “19. We have carefully considered the rival contention and perused the orders of the lower authorities. In the present case, admittedly, assessee has deposited money in bank account for which the source could not be explained properly and therefore lower authorities have made addition u/s 68 of the income tax act. The contention of the assessee is that he is not maintaining any books of accounts and therefore deposit made in the bank account of the assessee cannot be considered as an amount deposited in the books of accounts of the assessee and hence, the addition made u/s 68 of the income tax act stands vitiated and therefore it should be deleted. The first judicial precedent in this controversy is the decision of the honourable Bombay High Court in 141 ITR 67, wherein it has been held that that when monies are deposited in bank account, relationship that is constituted between the bank and the customer is of creditor and not the trustee and beneficiary. Therefore, it is not as if the bank passbook is maintained by the bank as an agent of the customer, nor can it be said that the passbook is maintained by the bank under the instructions of the customers. In view of this, the bank passbook supplied by the bank to the assessee cannot be regarded as a books maintained by the assessee under instructions. Accordingly, it was held that cash credit for the previous year shown in the assessee‟s bank passbook issued to him by the bank, but not shown in the Page | 8

Sri Jagdish Prasad Sharma Vs. ITO ITA No. 104/Del/2015 (Assessment Year: 2009-10) cashbook maintained by him for that year, does not fall within the ambit of section 68 of the income tax act. The facts in that case are that assessee did maintain the books of accounts , certain sums were found in the bank account of the assessee but were not found in the regular cashbook submitted by the assessee. In the circumstances, the honourable High Court stated so. Further, the assessment year involved in that case is 1962 – 63. Admittedly on that date definition of the „books of accounts‟ as prescribed under section 2 (12A) was not there on statute, which is inserted by the finance act, 2001, with effect from 1/6/2001. Further, the honourable Bombay High Court in 85 taxmann.com 306, 250 taxman 362 and 399 ITR 256 (Bombay) in Arunkumar J Muchhala V CIT has considered an identical issue where the above decision of the honourable Bombay High Court in 141 ITR 67 was considered. The honourable Bombay High Court noted that in Sudhir Kumar Sharma (HUF) vs CIT, 46 taxmann.com 340, honourable High Court noted that when during the course of assessment proceedings, assessing officer noted that the assessee has deposited huge amount of cash in his bank account, the addition of the said amount in the income of the assessee, by invoking the provisions of section 68 of the income tax act is justified. It was further held that onus is on the assessee to explain the nature and source of the said cash deposits. Special leave petition was preferred challenging the above judgment before honourable Supreme court. However, the honourable Supreme Court has dismissed the same in 69 taxmann.com 219 [239 taxmann 264]. In view of this, even if the assessee does not maintain any books of accounts but the amount is deposited in the bank account of the assessee, which remains unexplained the addition could be correctly made u/s 68 of the act. Further looking at the definition of the „books or books of accounts‟ it is apparent that passbook is a daybook which is kept in the return form or as a printout of data stored in a floppy. Therefore, after the introduction of the definition of the books or books of account under section 2 (12A) of the act, the passbook can also be considered as books or books of account. There is no distinction who writes it, but it is record of the transactions entered into by the assessee with the bank. The provisions of section 68 of the income tax act also does not make any distinction about who maintains the books of account, the only requirement is that the books should be of an assessee. There is no requirement that the books of account should be maintained by the assessee himself. In view of this, we do not find any infirmity in the order of the learned CIT – A, in confirming an addition of INR 512000/– on account of unexplained bank deposits under section 68 of the income tax act. Accordingly, the additional ground raised by the assessee for assessment year 2004 – 05 is also dismissed.” 16. In view of above facts and respectfully following the decision of the coordinate bench we hold that the cash deposited by the assessee in his

Sri Jagdish Prasad Sharma Vs. ITO ITA No. 104/Del/2015 (Assessment Year: 2009-10) bank account is also covered under section 68 of the income tax act. Thus the additional ground raised by the assessee is dismissed. 17. Coming to the merits of the case the learned Commissioner of income tax appeal has decided the above issue holding as under:- “4. During appeal proceedings the counsel of the appellant attended and made following written submission:- “Brief Facts The appellant has voluntarily filed his return of income declaring income of Rs. 90,200/- on 13.10.2009 The assessment has been framed by the Ld. Income Tax Officer, Ward 1(3), Ghaziabad after adding a sum of Rs. 19,97,650/- on account of unexplained cash credit and assessed at Rs.20,87,570/-. That during the year under consideration, assessee has deposited cash of Rs. 37,92,000/- in his savings bank account with Bank of Baroda. The Ld. Assessing Officer has asked to file the justification and sources of cash deposited in bank account along with complete cash flow statement. Assessee has submitted the complete details as asked for and also submitted the copy of agreement to sale for the Advance received by the assessee and affidavit/s) and gift deed(s) for the gifts received by him in the year under consideration. The Chart depicting the Cash received by the assessee from Advance for Sale of Agriculture Land and Gifts received which were deposited by him in his bank account and the amount allowed and disallowed by the Ld. Assessing Officer is appended below:- S. Amount Amount Amount No. Name Purpose Received Allowed Disallowed t Mr. Jai Rani Nagar Advance 3,00,000 7,00,000 Against Sale of 10,00,000 Agricultural Land Advance 9,00,000 2 Mr. Shree Chand Against Sale of 10,00,000 1,00,000 Agricultural Land Mr. Likhi Ram 3 Sharma Gift 1,00,000 25,000 75,000 4 Mr. Brahma Nand Gift 25,000 75,000 Sharma 1,00,000 5 Mrs. Bhagwati Gift 1,00,000 25,000 75,000 •-Mr. Dhaneshwar Gift Nil 6 ' Sharma 1,00,000 1,00,000 7 Mr. Bal Kishan Gift 50,000 Nil 50,000 Sharma

Sri Jagdish Prasad Sharma Vs. ITO ITA No. 104/Del/2015 (Assessment Year: 2009-10) The Ld. Income Tax Officer has erred in arbitrarily framing assessment u/s 143(3) of (he Income Tax Act, 1961, without considering the facts of the case explained and submitted to him. The Ld. Income Tax Officer has erred in presuming that the persons who have advanced the money to the assessee as per the agreement to sale entered with assessee does not have sources to pay the amount. The Ld. Income Tax Officer has accepted the agreement of sale entered by the assessee with the prospective buyers in one hand and assessee has discharged his onus by producing the buyers who have advanced the money to the assessee against the purchase of his agricultural land as insisted by the Ld. Income Tax Officer. That during personal deposition of the buyers Mr. Jai Ram Nagar and Mr. Shri Chand , they have confirmed that they hdve paid the advance to the assessee against the purchase of his agricultural land and also explained the sources of from which such amount have been paid to the assessee. That Mr. Jai Ram Nagar has also shown his withdrawal from his bank account justifying the payment made to the assessee which was totally ignored by the Ld. Income Tax Officer on the pretext that the date of withdrawal by Mr. Jai Ram Nagar and date of deposit by the assessee does not match, whereas at no time during his personal deposition Mr. Jai Ram Nagar has stated he has paid the amount to the assessee immediately after withdrawal from his bank account to the assessee but only explained that the amount has been paid to the assessee after withdrawal as Cash from Bank Account. That since the property under consideration was ancestral and No objection from all the family members were required to register the property in the buyers name, which was refused by the other family members and ultimately, assessee has returned back the amount advanced by Mr. Jai Ram Nagar partially in the current financial year and partially in the beginning of next financial year, which was confirmed by him during his personal deposition. That Mr. Shri Chand has also confirmed that he has paid the amount to the assessee during his personal deposition and also confirmed that the Original' papers of the property was lying with him till the time of payment made by the assessee which was totally ignored by the Ld. Assessing officer. Since both the person(s) from whom amount received by the assessee has confirmed on oath and during personal deposition also, No amount can be considered as unexplained and can be treated as Income of the assessee. That after the personal deposition of the above mentioned person(s), assessee has asked the Ld. Income Tax Officer for cross examination and appraised him and contrary noticed by him during personal deposition which was totally ignored by the Ld. Income Tax Officer. That even on 11.01.2012, assessee has filed an application with the Ld. Income Tax Officer to provide the Statement recorded by him during personal deposition which was not provided to him till date. Copy 6f Letter(s) filed during the assessment proceedings and on 11.01.2012 is enclosed for your kind consideration. That the Ld. Income Tax Officer has erred in not providing the opportunity to the assessee to explain and justify his case Page | 11

Sri Jagdish Prasad Sharma Vs. ITO ITA No. 104/Del/2015 (Assessment Year: 2009-10) after recording the statement of the buyers, whereas after every deposition, assessee has specifically requested to the Ld. Income Tax Officer to appraise him and also to provide the details and opportunity if any contrary observed during the personal deposition. In this manner principal of natural justice was violated by not providing any opportunity to the assessee to justify if any adverse observation has been formed against the assessee and specially when the assessee is specifically asking for the same in writing. That no copy of Statement recorded of the persons was confronted to the assessee nor was any copy of the same provided to the assessee. That during the year under consideration assessee has also received from his close relatives on his 25th marriage anniversary. That in support of which assessee has filed Affidavit, Gift Deed and confirmation of the said relatives. That assessee has also produced the Donors for personal deposition who have confirmed that the amount was paid to the assessee- and also explained their sources from which the amount was paid. That Late Mr. Brahma Nand Sharina, brother of the assessee and Mrs. Bhagwati was not produced before the assessing officer due to the fact that Mr. Brahma Nand Sharma was expired on 24.04.2009 and Mrs. Bhagwati due to family tradition but requested the Ld. Income Tax Officer to depute some person to record her statement, whether she has given the amount or not to the assessee, which was also ignored by the Ld. Assessing Officer. That the Ld. Income Tax Officer has erred in presuming that the donors who are aged about 55 and 65 years does not have capacity to store and retain small amount of Rs. 1,00,000/- which was given to the assessee on his 25th Marriage anniversary. That on one hand Ld. Assessing Officer has accepted the fact that the assessee has received the amount as Gift on 25th Marriage anniversary but on another hand allowed only partial amount due the fact that the donors does not have capacity to pay such gifts whereas all the income and assets in form of agricultural land of the Donors was duly explained and the evidences were also submitted by the assessee and by the donors also during their personal deposition before the Ld. Income Tax Officer. That the assessee has discharged his onus by providing the identity, relationship with donors, Occasion of the Gift and Capacity of the Donors and also their confirmation in form of affidavit(s), Gift Deed and also during their personal deposition which was duly ignored by the Ld. Income Tax Officer while assessing the income 6f the assessee. That the Ld. Income Tax Officer has erred in presuming that the assessee ha3 intentionally not made the personal deposition of his real brother Mr. Brahma Nand Sharma and his real sister-in-law Mrs. Bhagwati. That it was explained that Mr. Brahma Nand Sharma, brother of the assessee was expired on 24.04.2009 and the copy of gift deed , affidavit of legal heir, identity proof of legal heir and the donor and sources of gift given to the assessee. That it was explained to the Ld. Income Tax Officer that the real sister in law of the assessee, Mrs. Jagwati Sharma wife of Mr. Likhiram Sharma, brother of the assessee was expired on 27.11.2011 Page | 12

Sri Jagdish Prasad Sharma Vs. ITO ITA No. 104/Del/2015 (Assessment Year: 2009-10) and due to tradition in the family , elder lady Mrs. Bhagwati cannot be produced for personal deposition and requested to depute the official staff to record the statement, if necessary. That the Ld. Income Tax Officer has not taken any steps to record the statement of legal heir of late Mr. Brahmna Nand Sharma and Mrs. Bhagwati for the reasons better knwon to him and wrongly presumed that these persons have capacity of payment of gift of Rs.25,000/- each, totally ignoring the age of the donors , their relationship with the assessee and occasion of such gift. That Ld. Income fax Officer has also erred in ignoring the fact that even the death in the family all the donors have presented for personal deposition and even Mr. Likhiram Sharma , brother of the assessee, whose wife was expired on 27.11.2011 was also present for his personal deposition. That the Ld. Income Tax Officer has erred in not providing the opportunity to the assessee to explain and justify his case after recording the statement of the donors, whereas after every deposition, assessee has specifically requested to the Ld. Income Tax Officer to appraise him and also to provide the details and opportunity if any contrary observed during the personal deposition. In this manner principal of natural justice was violated by not providing opportunity to the assessee to justify if any adverse observation has been formed against the assessee and specially when the assessee is specifically asking for the same in writing. That no copy of Statement recorded of the donors was confronted to the assessee nor was any copy of the same provided to the assessee. That during the course of assessment proceedings and even in his first submission, assessee has submitted and disclosed that he has earned Saving Bank Interest of Rs. 10,627/- and Auto Sweep Interest of Rs.2,821/- but not included in his taxable income on the presumption that the same is not taxable as the assessee has also paid Interest of Rs.49,534/- to Bank of Baroda Car Loan Account and offered the same for taxation. However the Ld. Income Tax Officer has not only included the same but also included the Bank Interest of Rs. 10,000/- earned by his wife, Mrs. Sunita Sharma, whose bank statement was asked by the Ld. Income Tax Officer. That the Ld. Income Tax Officer has erred in levying Interest U/s 234 A & U/s 234 B of the Income Tax Act, 1961. That at No instance the Ld. Income Tax Officer has pointed out any defect in the return filed by the assessee nor found any sources of income from which assessee -has generated cash which can be treated as unexplained. That the Ld. Income Tax Officer has also erred in not providing any opportunity nor any show cause notice has been issued by him before making the assessment, hence principal of natural justice has been overlooked by the Ld. Income Tax Officer. Case Laws on which assessee has relied on Cash Credit 1. CIT v. East Coast Commercial Co. Ltd (1967) 63 ITR 449 (SC) Page | 13

Sri Jagdish Prasad Sharma Vs. ITO ITA No. 104/Del/2015 (Assessment Year: 2009-10) 2. Dhakeswari Cotton Mills Ltd v. CIT (1954) 26 ITR 782 (SC)t 3 DhirajilalGirdharilal v. CIT (1954) 26 ITR 736 (SC). 4. M/s Straptex (India) Limited vs Deputy Commissioner Of Income- Tax reported in 84 ITD 320 by the IT AT, Bombay 5. Mohd. SocbllajimoosaTumbi v. ITO (2009) 26 DTR 329 (Ahd- Trib) 6. Panchal Associates v. ITO (1989) 43 Taxman 295 (Ahd-Trib) (Tax- Mag). 7. VishnulalKarwa v. ITO (1987) 32 Taxman 276 (Jp-Trib) (Tax- Mag). 8. ITO v. Kaka Iron Stores (1996) 54 TTJ (Chd-Trib) 142 9. Kishan Lai Jewels (P) Ltd. v. Asstt. CIT (2008) 26 SOT 30 (Del- Trib) 10. Assessing Officer v. Mohan LalBubna Bros. (1994) 120 Taxation 75 (Dcl-Trib) and ACIT v. Tulsi Narayan Garg (2010) 34 (II) ITCL 554 (Agra-Trib). 11. CIT v. Metachem Industries (2000) 245 ITR 160 (MP) 12. Nemi Chand Kothari v. CIT &Anr. (2003) 264 ITR 254 (Gau) : (2003) 177 Taxdtion 390 (Gau) 13 Asstt. CIT v. Mahavir Metals & Alloys (2002)75 TTJ (Asr-Trib) 256 14. Asstt. CIT v. Dr. ArvindMathur (2005) 95 TTJ (Jod-Trib) 975 15. ITO v. Bhatia Enterprises (2003) 81 TTJ (Chd-Trib) 503 16. CIT v. Pragati Co-operative Bank Ltd. (2005) 6 (I) ITCL 421 (Guj-HC) : (2005) 278 ITR 170 (Guj) : (2005) 197 CTR (Guj) 505 17. CIT v. S. Kamaljeet Singh (2006) 8 (II) ITCL 111 (All-HC) : (2005) 147 Taxman 18 (All) 18. Smt. Shanti Devi v. ITO (2004) 90 TTJ (Agra-Trib) 651 19. A. Rajendran&Ors. V. Asstt CIT (2006) 12 (I) ITCL 365 (Mad-HC): (2006) 204 CTR (Mad) 9 20. CIT v. Laid Transport Corporation (2009) 28 (I) ITCL 423 (P&H- HC) : (2009) 180 Taxman 185 (P&H) 21. Asstt. CIT v. Rajasthan Asbestos Cement Co. (2009) 23 DTR (Jp- Trib) 430

Sri Jagdish Prasad Sharma Vs. ITO ITA No. 104/Del/2015 (Assessment Year: 2009-10) 22. Dy. CIT v. SmtArchana Devi (2004) 84 TTJ (Jod-Trib) 467 23. ITO v. Laxman Das Makhija (2009) 26 (II) ITCL 517 (Agra-Trib) : (2009) 313 ITR 123 (Agra-Trib): (2009) 116 ITD 47 (Agra-Trib) 24. S. Hastimal v. CIT (1963) 49 ITR 273 (Mad) 25. JaikishanDadlani v. ITO (2005) 4 SOT 138 (Mum-Trib) 26. Prop. Dhawala Service Station v. CIT (1993) 113 Taxation 11 (Jp- Trib). 27. ITO v. Suresh Kalmadi (1988) 73 CTR (Trib) 80 (Pune- Trib)(TM) 28. Jagadish Oil Mills v. ITO (1995) 52 TTJ (Ind-Trib) 102 29. CIT v. Shri Ram NarainGoel (1997) 224 ITR 180 (P&H) 30. Asstt. CIT v. Mahavir Metals & Alloys (2002) 75 TTJ (Asr-Trib) 256. 31. KanhaialalJangid v. Asstt. CIT (2008) 217 CTR (Raj) 354 32. CIT v. Laul Transport Corporation (2009) 28 (I) ITCL 423 (P&H- HC) : (2009) 180 Taxman 185 (P&H) 33. CIT v. Kinetic Capital Finance Ltd. (2012) 44 (I) ITCL 511 (Del-HC) : (2011) 202 Taxman 548 (Del). 34. Heirs & ORs of Late Laxmanbhai S. Patel v. CIT (2008) 174 Taxman 206 (Guj) : (2009) 222 CTR (Guj) 138. 35. R.B.N.J. Naidu v. CIT (1956) 29 ITR 194 (Nag), Chunilal Tikamchand Coal Co. Ltd. v. CIT (1955) 27 ITR 602 (Pat), Mehta Parikh & Co. v. CIT (1956) 30 ITR 181 (SC), Lalchand BhagatAmbica Ram v. CIT (1959) 37 ITR 288 (SC), Sri Ram Tandon v. CIT (1961) 42 ITR 689 (All) and Kanpur Steel Co. Ltd. v. CIT (1957) 32 ITR 56 (All)]. 36. Mehta Parikh & Co. v. CIT (1956) 30 ITR 181 (SC) and Lalchand Bhagat Ambica Ram v. CIT (1959) 37 ITR 288 (SC)]. 37. ITO v. Suresh Kalmadi (1988) 32 TTJ (Pune-Trib)(TM) 300. 38. [DCIT v. Rohini Builders (2002) Case laws on which assessee has relied on Gifts. 1 ITOv.DharamVirTuli (2003) 81 TTJ (Chd-Trib) 1028. Similarly in ITO v. MatadinSnehlata (HUF) (2004) 90 ITD 203 (All-Trib)

Sri Jagdish Prasad Sharma Vs. ITO ITA No. 104/Del/2015 (Assessment Year: 2009-10) 2. ITO v.DharamVirTuli (2003) 81 TTJ (Chd-Trib) 1028 and ITO v. MatadinSnehlata (HUF) (2003) 81 TTJ (All-Trib) 995 &SurajBhan Bajaj v. ITO (2006) 102 TTJ (Dcl- Trib) 665. 3. Mrs. RanjanaKatyal v. Asstt. CIT (2008) 19 (II) ITCT. 507 (Del- Trib) : (2008) 113 TTJ (Del-Trib) 479 4. Smt. SonuAgarwal v. ITO (2009) 28 (II) ITCL 324 (Luck-Trib) : (2009) 29 SOT 478 (Luck-Trib) 5. CIT v. Mayawati (2011) 338 ITR 563 (Del): (2011) 201 Taxman 1 (Del): (2011)243 CTR (Del) 9. 6. CIT v. Anil Kumar (1997) 58 TTJ (Del-Trib) 340 7. Asstt. CIT v. Lucky Pamnami [2011] 9 taxmann.com 146/129 ITD 489 (Mum.) 8. Smt. Veena Bhatia v. Asstt. CIT [ITA Nos.2680 & 2682 /Delhi/2009...(Delhi-Trib.)] 9. Dy. CIT v. AlokGautam[2010] 41 SOT 102 (Luck.), ITAT 10. ITO v. Kailash Chand Bansal[2003] 1 SOT 485 (Delhi). 11. Vijender Kumar Jain & Sons (HUF) v. Asstt.CIT[2007] 13 SOT 56 (Delhi)(URO)(SMC). 12. Smt. SonuAgarwal v. ITO[2009] 29 SOT 478 (Luck.). 13. Asstt. CIT v. SarvPrakashKapoor[2009] 119 ITD 197 (Agra) (TM). 14. CIT v. Ms. Mayawati [2011] 12 taxmann.com 306/201 taxman 1 (Delhi) 15. Gyan Chand Gupta v. CIT[2011] 16 taxmann.com 240/[2012] 49 SOT 13 (UROl (Jp.). 16. MurlidharLahorimal v. CIT (2006) 280 ITR 512 (Guj.) 17. Nek Kumar v. Asst. CIT (2005) 274 ITR 575 (Jaipur). 18. CIT Poona v. Bhai Chand H. Gandhi (1983) 141 ITR 67 (Bom.)” 5. Matter was remanded to the assessing officer vide this office letter dated 08.05.2013. In response, the Assessing Officer sent remand report vide his letter dated 04.06.2013 as under: In his submissions made before your goodself, the assessee mainly agitated the additions of R$. 19,97,650/- on account of unexplained cash credits under section 68 of I.T.Act, 1961 vide order u/s 143(3) of I.T.Act, 1961 dated 27.12.2011. At Page No. 5 in first para of his submission filed on 8th May, 2013 before your honour, the assessee mis-pleaded the fact that the A.O did not Page | 16

Sri Jagdish Prasad Sharma Vs. ITO ITA No. 104/Del/2015 (Assessment Year: 2009-10) supply him copy of statement recorded on oath till date. This contention of the assessep is not acceptable at all. The statement of all the parties were recorded in the presence of assessee as well as his Counsel Sh. Sandeep Bhatnagar which is also evidenced from their signatures on the statements. It is a fact that the assessee applied for supply of copies of statement vide his letter dated 11.01.2012 but no required fee challan was furnished alongwith the application. He was required, to furnish the same which was never produced by him. It is only on 21.05.2013 written the assessee produced the required fee challan in compliance to letter dated 08.05.2013 issued from this office as per your kind directions. Accordingly, copies of the statements were supplied to the assessee on the very same date i.e. 21.05.2013. Therefore, the plea taken by the assessee in this regard has no force at all. During the course of assessment proceedings, it was noticed by the A.O that the; assessee during the year under consideration has deposited cash of Its. 37,92,000/- in his saving bank account no. 307501000000066 at Bank of Baroda, Indirapuram, Ghaziabad. On being asked to furnish the detail and justification for these cash deposits, the assessee submitted the detail as per chart given at pa'ge no. 2 of the assessment order. In this chart the assessee explained the source of deposit of Rs. 10,00,000/- as advance received against sale of agricultural land from Shri Jai Ram Nagar S/o Shri Asha Ram R/o Vill- Kanawani on different dates i.e. Rs. 1,00,000/- on 19.04,2008, Rs. 1,00,000/- on 30.04.2008, Rs. 3,00,000/- on 30.04.2008 and Rs. 5,00,000/- on 05.05.2008 respectively. On being asked, the assessee produced Sh. Jai Ram Nagar whose statement on oath was recorded on 05.12.2011. In his statement Shri Jai Ram Nagar though admitted to have given cash advance of Rs. 10,0, 000/- to the assessee on different dates but could not co- relate the same from his bank statement and stated the source of sum advanced as income from agriculture some of which was being deposited in bank and also available at residence. Sh. Jai Ram Nagar stated to have annual agriculture income of only Rs. 1,60,000/- approximately which may not be sufficient for his house-hold expenses. It proved that Sh. Jai Ram Nagar is not a man of means to have advanced such a huge amount. Further, he had not sold any land or asset during the year or in past to have accumulated so much of funds with him at his residence. Further¬more the so called agreement to sale executed itself has no significance as the same is on a simple plain paper and not on a stamp paper registered with the Registering Authority. No sale- deed of this so called agreement was ever executed. In his statement Sh. Jai Ram Nagar also stated to have received back the advance money of Rs. 10,00,000/- in cash at the end of 2009 Page | 17

Sri Jagdish Prasad Sharma Vs. ITO ITA No. 104/Del/2015 (Assessment Year: 2009-10) for which also no date etc. could be given by him on the pretext that he is not remembered the date. It is worth to mention here that as per para-2 of the so called agreement, it is mentioned that if the second party do not fulfil strictly the terms of this agreement otherwise the First Party shall forfeit the full earnest money received under this agreement and the second party shall have no objection to it. One most important aspect of this so- called agreement is that the land under sale of so called agreement is only 890/- Sq. Meter for which the agreement is written for Rs. 1,24,60,000/- which by no stretch of imagination is the rates of agriculture land at the nearby location. The rates of above agriculture land at the time/date of agreement was approximately only Rs. 15,00,000/- per bigha. The land under consideration is less than 1 (One) bigha. All these facts prove that this is a cooked-up story to justify the cash deposits only. Since Shri Jai Ram Nagar could not prove his creditworthiness and genuine-ness of transaction nor he is .assessed to tax with the Deptt. therefore, the A.O rightly rejected the claim of advance and rightly hold the cash credit as un-explained which the assessee tried to divert as advance for sale of land. Further, the assessee explained the source of cash deposit of Rs. 10,00,000/- as advance against sale of same agricultural land from Shri Sri Chand S/o Tek Chand R/o 15-Mahiuddinpur, Kanawani being co-purchaser. On production ctf Shri Sri Chand, his statement on oath was also recorded on 16.12.2011. He also stated to have advanced Rs. 10,00,000/- to the assessee in cash from the cash available with him at residence. However, he could not justify the availability of Rs. 10,0, 000/- with him on the date of advance. Regarding agreement for purchase/sale of agriculture land, Shri Sri Chand in his statement admitted that the agreement was executed on Stamp Paper but he could not give the names of the witnesses and the Advocate who got the agreement prepared. Further, the facts of this so called agreement are different as the same is executed on plain paper and there is no signature of any witness. Therefore, this fact again goes to prove that this is a cooked-up storey and the so called agreement has been prepared later-on to justify the cash deposits in the account of assessee before the Income-tax Deptt. Further Shri Sri Chand could also not prove his credit-worthiness and genuineness of transaction. He is also not assessed to income-tax and had no means to advance such a huge money to the assessee. Therefore, the A.O has rightly concluded that the amount of Rs. 10,00,000/- shown to have received as advance for sale of land from Shri Sri Chand is the unexplained cash credit and added to the income u/s 68 of I.T.Act, 1961. To justify the other cash credits, the assessee claimed to have received gifts from his family members which are purely Page | 18

Sri Jagdish Prasad Sharma Vs. ITO ITA No. 104/Del/2015 (Assessment Year: 2009-10) agriculturists having very meagure amount of agriculture land and have no capacity to make any gift to the assessee. Statement on oath of Sh. Dhaneshwar Sharma, Likhi Ram Sharma & Sh. Bal Kishan Sharma were recorded on oath. In their statement all these persons stated to have make gifts to the assessee on the occasion of 25th Marriage Anniversary of the assessee Sh, Jagdish Prasad Sharma but could not even tell the date of anniversary and mode of gift has been stated as cash which was not even available with them but after getting loans made gifts. All these facts, goes to prove that the above persons/family members were persuaded to safe-guard the assessee from the consequences of income-tax, It is also worth to mention here that in his reply dated 24.11.2011 submitted during the course of assessment proceedings at para no. 7, the assessee himself admitted not to have any family function during the year under consideration. Therefore, the above assersion of the assessee further strengthen the fact that no family function i.e. 25th Marriage Anniversary was solemnized by the assessee and the so called gifts shown were actually unexplained cash credits of the assessee which were rightly disallowed and added to the income of the assessee under section 68 of I.T.Act, 1961. During the remand proceedings also the assessee was given an opportunity vide letter dated 27.05.2013 to prove his case and to furnish the following details I All sort of authentic and documentary evidences to prove legal rights in 890 Sq. meters Land and as stated to be negotiated as per agreement dated 17.06.2008 and latest copy of Khasra and Khatauni relating to land as owned by four brothers including you. What was total area of land belonged to family with reference to Bighas. II. Furnish authentic reason as to why terms/ conditions specified in agreement dated 17.06.2008 were violated and what was follow up by said parties with whom said agreement was entered into. Photocopy of agreement may also be filed which was admitted by Sh. Sri Chand on Stamp-paper in his statement recorded on 16.12.2011 at para 5. III. Furnish details of lands as admitted to be owned by your family members in their statements for earning income from whom gifts in cash were admitted to have received by you and from their depositions it appears that they were referring land as owned by you and three brothers family.

Sri Jagdish Prasad Sharma Vs. ITO ITA No. 104/Del/2015 (Assessment Year: 2009-10) IV. Furnish all details of sale of land as partly negotiated in agreement dated 17.06.2008 and there-after upto 31.03.2013 with copy of sale deeds/agreement etc. V. Prove ownership in land from which agriculture income had been shown in return. VI. Furnish photo-copy of purchase deed of Plot in the name of your wife Smt. Sunita Sharma including back portion of purchase-deed (showing seal of registering authorities) for ascertaining of facts and date of registration. Copy of document as given to said Sh. Sri Chand may also be filed. However, no compliance to the aforesaid letter has been made as neither any-body attended on the date fixed i.e. 03.06.2013 nor any written reply or detail as called far was received. In view of all the facts, narrated above it is proved beyond doubt that all the above amounts were unexplained cash credits of the assessee and the persons from whom advances/gifts have been shown are all of no means and just to accommodate the assessee, the creditworthiness of the persons and genuineness of transactions could not be established/proved. The assessee has relied upon various case laws which do not support him by any way as the facts of the assessee's case are different from those cases. The creditworthiness of the persons from whom advances/gifts have been claimed is not proved as well as the assessee could not prove the genuineness of the transaction. Even my predecessor has allowed some of the amounts taking a very lenient view and considering that these agriculturists might have some amounts in cash with them but actually all these cash credits are unexplained and liable to be added to the income of the assessee under section 68 of I.T.Act, 1961. 6. 6. A copy of the remand report of the A.O. has been provided to the appellant against of which he submitted rejoinder as under: 1. That the Remand Report submitted by the Ld. Income Tax Officer is against the fact of the case of the assessee and just trying to divert the attention of the facts and the mistake committed during the Assessment Proceedings. 2. That the Ld. Income Tax Officer has made the allegation in para 1. that the assessee is mis-pleaded the fact that the A.O. Page | 20

Sri Jagdish Prasad Sharma Vs. ITO ITA No. 104/Del/2015 (Assessment Year: 2009-10) did not supply him copy of statement on oath till date of the persons which were used against the assessee. That the Ld. Income Tax Officer has also stated that the statements were recorded in the presence of assessee as well as his counsel which is evidenced from the signatures on the statements. It was also stated that the assessee has applied for the statement vide letter dated 11.01.2012 but no required fee challan was furnished along with the application. He was required to furnish the same which was never produced. Allegations levied by the Ld. Income Tax Officer is totally against the fact of the case and baseless. In fact Statement(s) of the persons were recorded by the Ld. Income Tax Officer during the assessment proceedings without presence of assessee and his counsel. This is the procedure when statement on oath were recorded, then no body other than the person whose statement was recorded can be present. Although signatures were taken after the recording of the statement(s), as assessee has produced them before the Ld. Income Tax Officer to spell out the truth of his case. It is also important to note that two copies of statement(s) were made during the assessment proceedings but no copies were supplied to the assessee or to his counsel and both the copies are still available in the file of the assessee. That after every statement, assessee has clearly asking the assessing officer in writing to provide him the opportunity, if any contrary has been observed by him, which is evident from the copies of reply filed during the assessment proceedings which were produced before your good self and the same are also available with the Ld. Income Tax Officer. That at No time , the Ld. Assessing officer has asked to deposit the fees to obtain the copies of the statement recorded. It is only when your good self has directed them to provide the statement(s) to the assessee, then the Ld. Assessing Officer has asked to deposit the fee to obtain the statement(s) and provided to the assessee. It is also important to mention that No show cause Notice has been ever issued by the Ld. Income Tax Officer regarding the conclusion he has made out of the statement(s) recorded and used against the assessee whereas assessee was regularly asking to provide the opportunity to explain in writing through his submissions. That the Ld. Assessing officer has also raised the question of the amount of the agreement entered by the assessee with his prospective buyers which was also totally against the facts of the case. Since the land for which agreement was made can be converted into commercial one and lots of builders are coming with Residential Projects in the area, the buyers have entered into agreement with the assessee. This is also important to note the this point was never raised by the Ld. Income Tax Officer during the assessment proceedings. This is also important to Page | 21

Sri Jagdish Prasad Sharma Vs. ITO ITA No. 104/Del/2015 (Assessment Year: 2009-10) Note that both the buyers have confirmed the transaction with the assessee in their statement recorded on oath and if the Ld. Income Tax Officer was not satisfied, then he should provide a opportunity to the assessee to revert. In any case, if the person(s) have accepted the transaction with the assessee and the Ld. Income Tax Officer has not satisfied with the creditworthiness of the person, then the assessing officer of those persons can verify the same but no adverse opinion could be made against the assessee. The Ld. Assessing officer has also erred in presuming that there is difference in the statement given by the person(s) and the fact of the case of the assessee, ignoring the fact that the statement was recorded of the illiterate villagers who have narrated the truth to the assessing officer but not remembered the date of payment of amount to the assessee. Even the agreement entered by the assessee was not doubt by the Ld. Income Tax Officer during the assessment proceedings but now in remand report, the Ld. Assessing officer is raising the fresh issues which was not gathered and determined by the assessing officer at the time of assessment proceedings. The Ld. Income Tax Officer has also raised the objection that the assessee has mentioned in his reply that No function was held during the year. Even today, assessee is stating the same facts, that No function was conducted for his 25th Anniversary of Marriage and his immediate relatives has made the voluntarily customary gifts to him and accepted the same at the time of recording the statement(s). The Ld. Income Tax Officer has also not brought any instances by which assessee could receive so much of cash other than facts and the truth explained by him, which was deposited in his bank account. The Ld. Income Tax Officer has also mentioned about the letter dated 27.05.2013 issued to the assessee to prove his case but no letter was ever received by the assessee. 3. That the Ld. Income Tax Officer has started the assessment proceedings again by issuing the Letter to the persons whose statements were recorded during the assessment proceedings to cover up the mistake which was committed during the assessment proceedings by not providing the statements or show cause to the assessee, even after the repetitive requests made during the assessment proceedings and post assessment proceedings. 4. That the Ld. Income Tax Officer has provided the copies of Statements(s) recorded during the assessment proceedings after the directions given by yourself which were used against the assessee for making additions after deposit of requisite fees. Page | 22

Sri Jagdish Prasad Sharma Vs. ITO ITA No. 104/Del/2015 (Assessment Year: 2009-10) 5. That the letter dated 13.05.2013 was issued to all the persons whose statement was earlier recorded fixing the date of hearing on 17.05.2013 which were received by the persons on 31.05.2013 (i.e., after the date of hearing). 6. That again No opportunity was provided to the assessee to provide the letters issued to the persons to produce in support of his claim made during the assessment proceedings. 7. That during the assessment proceedings, assessee has himself produce the person(s) from whom advance against the property and gifts from relatives were received except Mr. Brahma Nand Sharma who expired on 24.04.2009 and Mrs. Bhagwati due to family traditions but requested the assessing officer to depute some official to record his statement. 8. That the fact emerges from all the statements recorded during the assessment proceeds that all the persons has cooperated with the assessing officer and not only confirmed the transaction with the assessee but also declared their sources of the money given to the assessee. That at no point, any conclusion was made / emerges out of the statement recorded during the assessment proceedings, that the amount was not paid to the assessee or the persons does not have enough sources to pay such amount to the assessee. 9. That at No instance the Ld. Income Tax Officer has pointed out any defect in the return filed by the assessee nor found any sources of income from which assessee has generated cash which can be treated as unexplained. That the Ld. Income Tax Officer has also erred in not providing any opportunity nor any show cause notice has been issued by him before making the assessment, hence principal of natural justice has been overlooked by the Ld. Income Tax Officer. 10. That even providing the statements recorded during the assessment proceedings at this stage after the directions given by the Ld. CTT(A) does not cover up the illegality committed during the assessment proceedings to use the statements recorded and used against the assessee for making additions without providing any opportunity to him to revert. 11. That the assessee again relied on the judicial pronouncement cited in earlier submission in which it was decided that the Principles of Natural justice are violated if an adverse order is made on an assessee on the'basis of the material not brought to his notice and that in making an assessment under section 143(3), the assessing officer is not entitled to make a pure guess and make an assessment without reference to any evidence or any material at all. There must be Page | 23

Sri Jagdish Prasad Sharma Vs. ITO ITA No. 104/Del/2015 (Assessment Year: 2009-10) something more than bare suspicion to support the assessment under section 143(3). 12. That It is important to Note that as per the statements recorded during the assessment proceedings reveals the following observations :- a. Mr. Jai Ram Nagar As per Answer to Question No. 23 ,Mr Jai Ram Nagar has confirmed that he had entered into an agreement with the assessee for purchase of agricultural land and paid the amount to the assessee and as per Answer to Question No. 25, he has confirmed that he has received back the amount from the assessee. b. Mr. Shri Chand As per Answer to Question No. 3 at page 4 and Answer to Question No. 2 at page 5, Mr, Shri Chand has confirmed that he had entered into an agreement with the assessee for purchase of agricultural land and paid the amount to the assessee and also mentioned the purpose for which such agreement was entered. c. Mr. Likhi Ram (Brother of Assessee) As Per Answer to Question No. 2 at Page 3, Mr. Likhi Ram has confirmed that he has made a gift of Rs. 1,00,000/- on the 25th Marriage Anniversary of the assessee. d. Mr. Balkishan Sharma (Nephew of Assessee) As Per Answer to Question No. 2 at Page 2, Mr. Balkishan Sharma has confirmed that he has made a gift of Rs.50,000/- on the 25th Marriage Anniversary of the assessee. e. Mr. Dhaneshwar (Nephew of Assessee) As Per Answer to Question No. 12 , Mr. Dhaneshwar has confirmed that he has made a loan of Rs. 1,00,000/- to the assessee. 13. That the analysis emerges from all the questions asked by the Ld. Assessing officer reveals that he has predetermined to penalize the assessee and try to trap the illiterate persons. 14. That at No instances, the Ld. Assessing Officer has ever tried to record the statement of the sister-in-law of the assessee and son of deceased brother who has made the gift of Rs. 1.00,000/- each but disallowed the same on presumption that Page | 24

Sri Jagdish Prasad Sharma Vs. ITO ITA No. 104/Del/2015 (Assessment Year: 2009-10) those person(s) does not have any creditworthiness, whereas assessee has requested to depute the person to record her statement, if required. 15. The Ld. Income Tax Officer has ignored all the judicial pronouncement relied by the assessee in his submission before your good self by just stating that the facts are different in this case, clearly reflecting his negative attitude to penalize the assessee without analyzing the case laws relied by the assessee. Keeping in view the above facts this is to request you to cancel the arbitrary / illegal ssessment made by the Ld. Income Tax Officer, Ward 1(3), Ghaziabad, which is bad in law, against the principles of natural justice and as well as against the facts of the case and is liable to be quashed on legal and also on merits &provide the justice to the assessee and oblige. 7. Having considered facts of the case, submission of the appellant, remand report and rejoinder to the remand report, the appeal is decided as under: 7.1 The main issue in this case relates to genuineness of source of deposit in the bank A/c of the appellant. The main contention of the appellant is that statements recorded by the Assessing Officer were not provided to him and providing such statement at appellate stage does not cover up the illegality committed during assessment proceedings. The contention of the appellant is not tenable because in the remand report stage, the Assessing Officer has provided copy of statement on 21.05.2013. Having obtained copy of statement on the basis of these statements, the appellant has claimed that the said persons have confirmed having advanced money to the appellant. The Assessing Officer has analyzed the statement recorded and established that creditworthiness of the persons is not proved despite statement that they advanced money. In his submission, the appellant has not commented anything about the findings of the Assessing Officer regarding creditworthiness of the said persons. On the other hand in the remand report, the Assessing Officer has highlighted various discrepancies in the statement recorded and has also given an opportunity to the appellant to prove/furnish following details:- "I. All sort of authentic and documentary evidences to prove legal igts in 890 sq. meters land and as stated to be negotiated as per agreement dated 17.06.2008 and latest copy of Khasra and Khatauni relating to land as owned by four brothers including you. What was total area of land belonged to family with reference to Bighas. II. Furnish authentic reason as to why terms/conditions specified in agreement dated 17.06.2008 were violated and what Page | 25

Sri Jagdish Prasad Sharma Vs. ITO ITA No. 104/Del/2015 (Assessment Year: 2009-10) was follow up by said parties with whom said agreement was entered into. Photocopy of agreement may also be filed which was admitted by Sh. Sri Chand on stamp paper in his statement recorded on 16.12.2011 at para 5. III. Furnish details of lands as admitted to be owned by your family members in their statements for earning income from whom gifts in cash were admitted ot have received by you and from their depositions it appears that they were referring land as owned by you and three brothers family. IV. Furnish all details of sale of land as partly negotiated in agreement dated 17.06.2008 and thereafter upto 31.03.2013 with copy of sale deeds/agreement etc. V. Prove ownership in land from which agriculture income had been shown in return. VI. Furnish photo-copy of purchase deedAaf-pktfijQ^hie name of your wife Smt. Sunita Sharma including back portfonr bf purchase-deed (sh6wixi.g seal of registering authorities) for ascertaining of the facts and date of registration. Copy of document as given to said Shr. Sri Chand may also be filed. This opportunity has not been availed by the appellant. 7.2 In the light of the detailed discussion in the assessment order and remand report and fact that the appellant has not produced required details during remand proceedings it is beyond doubt that the assessee has failed to prove genuineness of the transaction as well as creditworthiness of the creditors. The judicial decisions cited by the appellant do not help his case as the primary onus u/s 68 is on assessee which has not been discharged satisfactorily. The gifts or loans have not proved satisfactorily. Same is the case with receipts against sale of land which was not proved to be sold till date. 7.3 The relevant law and case laws in the matter are discussed below before analyzing the facts of the case further: (i) Where any sum is found credited in the book of an assessee maintained for any previous year, and the assessee offers no explanation about the nature and source thereof or the explanation offered by him is not, in the opinion of the [Assessing] Officer, satisfactory, th,e sum so credited may be charged to income-tax as the income of the assessee of that previous year (ii) The Assessing Officer when starts enquiry, specifically to' satisfy himself of the source of such credit, and if during the enquiry, he is satisfied that the entries are not genuine,

Sri Jagdish Prasad Sharma Vs. ITO ITA No. 104/Del/2015 (Assessment Year: 2009-10) then he has every right to add the said sum represented by such credit entry as income of the assessee. (iii) Under Section 68, the onus is on the assessee to offer explanation where any sum is found credited in the books of account and where the assessee fails to prove to the satisfaction of the Assessing Officer, the source and nature of the amount of cash credits, he is entitled to draw an inference that the credit entries represent income taxable in the hands of the assessee. It is not the duty of the Assessing Officer to locate the exact source of the cash credits. The burden to identify the source lies upon the assessee and he is required to explain the genuineness of the credit entry. (iv) Section 68 enacts a golden rule of evidence which is not in dispute, i.e., if any sum is found credited in the books of account of an assessee, the onus is on him to explain the said entry. The principle embodied in Section 68 is only a statutory recognition of what was always understood to be the law based upon the rule that the burden of proof is on the taxpayer to prove the genuineness of borrowings since the relevant facts are exclusively within his knowledge. Even before the enactment of Section 68, this rule of evidence was applicable vide Kate Khan Mohammed Hanif CIT [1963] 50 ITR 1 (SC) iv) Though the Assessing Officers, often, acts on confirmatory letters as evidence, the onus does not get discharged merely by such confirmatory letters as found in CIT Vs. United Commercial and Industrial Co. (Pvt.) Ltd. (1991) 187 ITR 596 (Cal). (vi) In the case of Kama! Motors v. CIT [2003] 131 Taxman 155 (Raj.), it was held that the responsibility is on the assessee to discharge the onus that the cash creditor is a man of means to allow the cash credit. (vii) The burden to prove the source of receipt is in respect of each entry as held in the case of CIT v. R.S. Rathore [1995] 212 ITR 390 (Raj.) (viii) On the issue of burden of proof the Hon. Calcutta High Court in CIT vs. Precision Finance Pvt. Ltd. (1994) 208 ITR 465 (Ca I) laid down that the assessee is expected to establish 1. Identity of his creditors; 2. Capacity of creditors to advance money; and

Sri Jagdish Prasad Sharma Vs. ITO ITA No. 104/Del/2015 (Assessment Year: 2009-10) 3. Genuineness of transaction. As to the issue of genuineness of transaction, it was further held in the above decision that the transaction is not genuine, simply because some, out of many, of the transactions are by cheque. Conversely, it is not open for the Assessing officer to add token amount merely for the purpose of making the returned income into a round figure. Where certain sum of money claimed by the assessee to have been borrowed from certain persons, it is for the assessee to prove, by cogent and proper evidence, that they are the genuine borrowings for the reason that the facts are exclusively within the assessee's knowledge. (ix) In CIT vs. Bhan & Sons (2005) 273 ITR 206 (P & LI), it was found that the credits were received by account payee cheques and the creditors were income tax asscssccs. But the contention of the Assessing Officer was that the assessee did not respond to the requirements of the production of creditors before him for verification. The first appellate authority and the High Court felt that it was possible for the Assessing Officer to have accepted the same or make further enquiries with reference to the files of the creditors, since they were assessees. Even so, the High Court reversing the finding of the Tribunal observed as under \“the appellate authorities have failed to appreciate that in the present case the assessee had totally failed to respond to the notice of the Assessing Officer. Further, even if they were of the view that the Assessing Officer should have made cross verification with the records of the creditors available with him, they ought to have directed the Assessing Officer to do so instead of straight way accepting the assessee‟s version without affording any opportunity to the Assessing Officer to make the verification. In the alternative, the appellant authorities could have themselves verified the material placed before them with the records of the creditors. This has not been done. Accordingly, we are satisfied that the appellate authorities have not dealt with the matter properly. ” (x) Delhi High Court in the case of CIT vs. Oasis Hospitalities Pvt. Ltd., 333 ITR 119 (Delhi)(201 I), that “The initial onus is upon the assessee to establish three things necessary to obviate the mischief of Section 68. Those are: (i) identity of the investors; (ii) their creditworthiness/investments; and (iii) genuineness of the transaction. Only when these three ingredients are established prima facie, the department is required to undertake further exercise.” (xi) Credits in accounts claimed as advance received towards sale of shops and affidavit filed from such creditors - But none of them were produced before the Assessing Officer for authenticating their signature and explaining the contents of the Page | 28

Sri Jagdish Prasad Sharma Vs. ITO ITA No. 104/Del/2015 (Assessment Year: 2009-10) affidavit - Possession of shops not handed over or money was not returned even after lapse of considerable time Addition under Section 68 upheld. (Krishan Kumar Jhamb Vs ITO & Anr (P&H) 17 DTR 249). (xii) Hon. Supreme Court in CIT v. Durga Prasad More [1971] 82 ITR 540 , at pages 545-547 made a reference to the test of human probabilities stating that “this raises the question whether the apparent can be considered as real. As laid down by this Court, apparent must be considered real until it is shown that there are reasons to believe that'the apparent is not the real and that the taxing authorities are entitled to look into the surrounding circumstances to find out the reality and the matter has to be considered by applying the test of human probabilities Now we shall proceed to examine the validity of those grounds that appealed to the learned judges. It is true that an apparent must be considered real until it is shown that there are reasons to believe that the apparent is not the real. In a case of the present kind a party who relies on a recital in a deed has to establish the truth of those recitals, otherwise it will be very easy to make self-serving statements in documents either executed or taken by a party and rely on those recitals. If all that an assessee who wants to evade tax is to have some recitals made in a document either executed by him or executed in his favour then the door will be left wide-open to evade tax. A little probing was sufficient in the present case to show that the apparent was not the real. The taxing authorities were not required to put on blinkers while looking at the documents produced before them. They were entitled to look into the surrounding circumstances to find out the reality of the recitals made in those documents. Now, coming to the question of onus, the law does not prescribe any quantitative test to find out whether the onus in a particular case has been discharged or not. It all depends on the facts and circumstances of each case. In some cases, the onus may be heavy whereas, in others, it may be nominal. There is nothing rigid about it. Herein the assessee was receiving some income. He says that it is not his income but his wife‟s income. His wife is supposed to have had two lakhs of rupees neither deposited in banks nor advanced to others but safely kept in her father‟s safe. Assessee is unable to say from what source she built-up that amount. Two lakhs before the year 1940 was undoubtedly a big sum. It was said that the said amount was just left in the hands of the father-in-law of the assessee. The Tribunal disbelieved the story, which is, prima facie, a fantastic story. It is a story that does not accord with human probabilities. It is strange that the High Court found fault with the Tribunal for not swallowing that Page | 29

Sri Jagdish Prasad Sharma Vs. ITO ITA No. 104/Del/2015 (Assessment Year: 2009-10) story. If that story is found to be unbelievable as the Tribunal has found, and in our opinion rightly, then the position remains that the consideration for the sale proceeded from the assessee and, therefore, it must be assumed to be his money. It is surprising that the High Court has found fault with the Income- tax Officer for not examining the wife and the father-in- law of the assessee for proving the department‟s case. All that we can say is that the High Court has ignored the facts of life. It is unfortunate that the High Court has taken a superficial view of the onus that lay on the department. „...Science has not yet invented any instrument to test the reliability of the evidence placed before a Court or Tribunal. Therefore, the Courts and Tribunals have to judge the evidence before them by applying the test of human probabilities. Human minds may differ as to the reliability of a piece of evidence. But, in that sphere, the decision of the final fact-finding authority is made conclusive by law.” (p. 545) (xiii) In Som Nath Maini v. CIT [2008] 306 ITR 414 (Punj. & Har.) the assessee in his return declared loss from sale of gold jewellery and also declared a short-term capital gain from sale of shares so that the two almost match each other. This simple tax planning became ineffective after the Assessing Officer disbelieved the astronomical share price increase applying the test of human probability. The Assessing Officer observed that short-term capital gains were not genuine in as much as the assessee had purchased 45000 shares of Ankur International Ltd. at varying rates from Rs. 2.06 to Rs, 3.1 per share and sold them within a short span of six-seven months at the rate varying from Rs. 47.75 paisa to Rs. 55. Even though the two respective transactions for purchase and sale of shares were routed through two different brokers, yet the Assessing Officer did not believe the astronomical rise in share price of a company from Rs. 3 to Rs. 55 in a short-term. The assessee lost its case before the Tribunal. Confirming the order of the Tribunal, the Punjab and Haryana High Court held that the burden of proving that income is subject to tax is on the revenue but, on the facts, to show that the transaction is genuine, burden is primarily on the assessee. As per the Court, the Assessing Officer is to apply the test of human probabilities for deciding genuineness or otherwise of a particular transaction. Mere leading of the evidence that the transaction was genuine, cannot be conclusive. Any such evidence is required to be assessed by the Assessing Officer in a reasonable way. Genuineness of the transaction can be rejected in case the assessee leads evidence which is not trustworthy, and the department does not lead any evidence on such an issue. Page | 30

Sri Jagdish Prasad Sharma Vs. ITO ITA No. 104/Del/2015 (Assessment Year: 2009-10) (xiii) In CIT Vs independent Media P L (210 taxman 14) Hon‟ble Delhi HC has held that for making addition u/s 68, AO need not establish that the money has come from the assessee coffer. (xiv) Assessee failed to prove the genuineness of credit. Mere proof of identity of creditor or that transaction was by cheque, is notsufficient. Addition u/s 68 upheld. ( Mangilal Jain Vs ITO (Mad) 3151TR 105; CIT Vs Precision Finance P. Ltd. (Cal) 208ITR 465. (xv) In case of CIT v/s NR Portfolio Pvt Ltd (Delhi) ITA NOS. 134/2012 Order dt 21/12/2012 following the case of (A. Govindarajulu Mudaliar 34 ITR 807) it has been held that the concept of “shifting onus” does not mean that once certain facts are provided, the assessee‟s duties are over. If on verification, the AO cannot contact the share applicants, or the information becomes unverifiable, the onus shifts back to the assessee. At that stage, if it falters, the consequence may well be an addition u/s 68 (xvi) In Shankar Ghosh v ITO [1985] 23 TTJ (Cal.) 20 the assessee failed to prove the capacity of the person from whom he had allegedly taken loan. Further the assessee could not explain the need for the loan and the manner in which the loan amount was spent. The creditor issued two letters demanding repayment but did nothing on non compliance therewith.- such letters did not therefore carry any conviction about the explanation of the assessee. Loan amount was rightly held as assessee‟s own undisclosed income. (xvii) In the case of Sumati Dayal 214 ITR 801(SC) it has been held that, where any sum is found credited in the books of the assessee for any previous year, the same may be charged to income-tax as the income of the assessee of that previous year if the explanation offered by the assessee about the nature and source thereof is, in the opinion of the Assessing Officer, not satisfactory. In such case there is prima facie evidence against the assessee, viz., the receipt of money, and if he fails to rebut the same, the said evidence being unrebutted, can be used against him by holding that it is a receipt of an income nature. While considering the explanation of the assessee, the department cannot, however, act unreasonably. 7.4 In back drop of the above legal position as laid down by various courts the issue is decided in the instant case as below: It is seen that The Assessing Officers has recorded statements of the persons from whom the assessee has claimed to have received the advances against alleged purchase of land. He has analysed the discrepancies in the statements as well as the financial position of each Page | 31

Sri Jagdish Prasad Sharma Vs. ITO ITA No. 104/Del/2015 (Assessment Year: 2009-10) person from whom the said advances were claimed to have been received. During appeal the appellant had claimed that he had not been provided the copies of statements. During remand proceedings such statements were provided. The assessing officer raised certain material queries to the assessee during remand proceedings. The queries raised by AO are relevant to the issue at hand as discussed supra. This opportunity has not been availed by the appellant. The assessee has merely harped on the contention that the statements were not provided to him during assessment proceedings and providing the same now cannot undo the wrong. This claim of appellant is not tenable. The statements have been provided to appellant. The conclusions drawn from these statements are in knowledge of assessee through assessment order and despite that he has not come out clean with the facts about ownership of land and its sale whether really effected or not. The only inference that can be drawn is that the assessee has merely concocted a story to explain cash deposits in his bank account. Particularly when many creditors are relatives, not assessed to tax and agriculturists of low means and the transactions are entirely in cash, the onus is heavier on the assessee to prove genuineness of his claim. During remand proceedings also he has failed to avail of the opportunity to discharge this onus. Therefore, the additions of AO as regards the unproved cash credits of the assessee are not only confirmed but enhanced in few cases (for which reliance is placed on the case of CIT vs. Precision Finance Pvt. Ltd. (1994) 208 ITR 465 (Ca 1) wherein it was held that it is not open for the Assessing officer to add token amount merely for the purpose of making the returned income into a round figure.) as per following discussion for each creditor: (i) Brahmanand Sharma: He is real brother of assessee. Gift of Rs. 1 lac was shown from him. He could not be produced for examination as he had expired. (ii) Smt. She is sister of assessee. She was not produced for examination considering her age and family traditions. Gift of Rs. 1 lac had been claimed to have been received from her. In these two cases the AO has held that the gifts are not proved on account of non production of these persons. He has however made addition of Rs, 150000 holding that the Rs. 50000 could be considered explained as regards source. Such action of AO is not justified. Once the transaction is held to be not proved, no part relief can be given on .account of creditworthiness. Therefore the addition is enhanced to Rs. 2Iac. Page | 32

Sri Jagdish Prasad Sharma Vs. ITO ITA No. 104/Del/2015 (Assessment Year: 2009-10) (iii) Jairam Nagar: Rs. 10 lac were shown to have been received against purchase of land by him from the assessee. From his statement the AO has found that there is gap between the date of amount having been given by Jairam Nagar and deposit in bank account of assessee. Shri Jairam has not sold any property and he is a man of low means earning only Rs. 160000 from agricultural. Agreement to sale was also on a plain piece of paper. He having given an amount of Rs. 10 Lacs to assessee without having explainable sources and keeping this money with assessee for long time defy any prudence and disprove the genuineness of claim as Shri Jairam lacked the creditworthiness. However, the AO has made addition of Rs. 7 Lacs only taking a lenient view. In facts and circumstances of the case, I find that not only the creditworthiness but the genuineness of the transaction is not proved. Having given a finding that the transaction is not genuine particularly in view of the fact that the agreement to sale on a plane piece of paper is not reliable, the question of creditworthiness was less relevant. In remand proceedings the appellant has not responded to relevant queries by the AO. Therefore- the lenient view adopted by AO is not justified. The whole of the amount purported to have been received as advance against sale of land is held to be not proved and therefore the addition is enhanced to Rs. 10 Lacs. (iv) Shri Chand: He is shown to have advanced Rs. 10 Lac to assessee for purchase of land from assessee. In the statement recorded neither did he remember the names of witnesses nor did he disclose the sources of the deposit. The agreement to sale was also on a plain piece of paper. The AO giving benefit of creditworthiness of Rs. 100000, made an addition of Rs. 9 Lacs on account of creditworthiness not having been proved. Here again the lenient view of the AO is not justified. The fact that the deponent did not remember names of the witnesses to the impugned sale agreement is material to the case. In remand proceedings the appellant has not responded to relevant queries by the AO. In facts and circumstances of the case the whole of the amount purported to have been received as advance against sale of land is held to be not proved and therefore the addition is enhanced to Rs. 10 Lacs. (v) Bal Kishan Sharma: The AO has observed that this person is of low means and his giving gift on marriage anniversary but not remembering the date of marriage are surprising. This gift has been shown to have been advanced after taking a loan of Rs. 25000 from his brother in law. Therefore the action of AO in treating this claim of assessee of receiving gift from Bal Kishan Sharma as not proved and addition of Rs. 50000 is justified and upheld.

Sri Jagdish Prasad Sharma Vs. ITO ITA No. 104/Del/2015 (Assessment Year: 2009-10) (vi) Likhi Ram Sharma: The facts are similar to that of Bal kishan. He too has claimed to have given gift on occasion of marriage anniversary after taking a loan of Rs. 25000 from his brother in law. Once the gift is not proved, making addition of Rs. 75000 only and not full amount of Rs. 100000/- is not justified. In facts and circumstances of the case addition is enhanced to Rs. 100000. (vii) Dhaneshwar Sharma: He has claimed to have given loan of received back. The fact is that the said loan is claimed to have been given in cash and there is no proper source of funds. The claim has been rightly rejected by the assessing Officer. The addition of Rs. 100000 is confirmed. 7.5 In facts and circumstances of the case and legal position as above as applicable to these facts, applying above judgements and the test of human probability as propounded in cases of Durga Prasad, Sumati Dayal and Som Nath Maini v. CIT (Supra), it is held that the assessee has failed to discharge the onus cast upon him u/s 68 and has thus failed to prove the genuineness of the transaction and the creditworthiness of the creditors. The grounds of appeal are rejected and additions are upheld /enhanced as above.

Sri Jagdish Prasad Sharma Vs. ITO ITA No. 104/Del/2015 (Assessment Year: 2009-10) 1,975,000/- to Rs. 24.50 Lacs is not sustainable in law on the principles of natural justice not followed by him. Therefore we direct the learned assessing officer to restricted the addition to the extent of Rs. 1975000/– u/s 68 of the Act and assessee is granted relief to that extent. Accordingly ground number 2 of the appeal of the assessee is allowed. 19. Coming to the merits of the case with respect to the addition made by the learned Assessing Officer, it is apparent that the assessee has failed to show the gifts of loans satisfactorily before the learned Assessing Officer. The assessee has also failed to show the genuineness of the transaction of receipt of the sale of land for the reason that there is no sale taken place of any agricultural land by the assessee against the above advance. Further, the learned assessing officer as well as the learned CIT(A) has examined the creditworthiness of each and every credit shown by the assessee. Looking to the meagre income shown by the depositors, absence of any evidence and source of deposit of cash available with them, failure to produce evidence of the consequent sale of land, failure to show the names of the witness to the sale agreement, shows that assessee has failed to show the creditworthiness of the depositors against sale of land as well as of the gift. In view of this we do not find any infirmity in the order of the learned assessing officer in making the addition u/s 68 of the income tax act to the extent of INR 1,975,000 out of the total cash deposit of Rs. 24.50 Lacs in the bank account of the assessee. In view of this ground No. 1 of the appeal of the assessee is dismissed. 20. Coming to ground No. 3 of the appeal with respect to the addition of Rs. 22365/- on account of bank interest the learned Assessing Officer has noted in paragraph No. 2 of the assessment order that assessee has a savings bank interest income which is chargeable to tax under that income from other sources. No arguments were advanced by the assessee on this ground of appeal. We also do not find any infirmity in making the addition in the hands of the assessee as assessee has earned net bank interest of Rs. 22365/-. Accordingly ground No. 3 of the appeal of the assessee is dismissed. 21. Accordingly appeal of the assessee is partly allowed. Page | 35

Sri Jagdish Prasad Sharma Vs. ITO ITA No. 104/Del/2015 (Assessment Year: 2009-10) Order pronounced in the open court on 13/01/2020 -Sd/- -Sd/- (K.N.CHARY) (PRASHANT MAHARISHI) JUDICIAL MEMBER ACCOUNTANT MEMBER Dated: 13/01/2020 A K Keot Copy forwarded to 1. Applicant 2. Respondent 3. CIT 4. CIT (A) 5. DR:ITAT ASSISTANT REGISTRAR ITAT, New Delhi