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Income Tax Appellate Tribunal, KOLKATA ‘C’ BENCH, KOLKATA
Before: Sri J. Sudhakar Reddy & Sri Aby T. Varkey
order
: October 22nd, 2020 ORDER
Per J. Sudhakar Reddy, AM:
This is an appeal filed by the assessee directed against the order of the Commissioner of Income Tax (Appeals), Asansol [hereinafter ld. ‘CIT(A)’ for short] dated 02.01.2019 passed u/s 250 of the Income Tax Act, 1961 (‘the Act’ for short) for AY 2014-15.
The assessee is an individual and her profession is to assist her husband, who is a priest in a local temple known as Baba “Dhaneswar Nath Mandir”. Her profession is known as ‘Tantra Dhari’. She e-filed her return of income on 02.03.2016 for the AY 2014-15 declaring total income of ₹1,98,340/-. The assessment was completed u/s 143(3) of the Act on 28.12.2016 determining total income at ₹51,17,040/-, inter alia, making additions u/s 56(2)(vii), Explanation (b) r.w.s. 50C of the Act of ₹34,18,701/- and ₹15lakhs being cash deposits. On appeal, the first appellate authority reduced the addition u/s 50C of the Act to ₹4,12,775/-, based on the valuation made by the District Valuation Officer. Regarding the amount of ₹15 lakhs cash deposits, the addition was confirmed.
Assessment Year: 2014-15 Smt. Mousumi Roy. 3. Aggrieved, the assessee is in appeal before us.
Rival contentions heard. On a careful consideration of the facts and circumstances of the case, perusal of the papers on record and the case law cited, we hold as follows.
On the issue of addition made u/s 50C of the Act, the assessee’s contention is that, no addition can be made u/s 50C of the Act on transaction involving agricultural land, as it is not a capital asset. We agree with this submission. Section 50C of the Act is in Chapter IV of the Act which deals with computation of income from capital gains. Agricultural land is not a capital asset unless it falls within the definition of Section 2(14) of the Act. There is no finding that the agricultural land in question falls within the meaning of Section 2(14)(iii) of the Act. Hence, the charging Section cannot be applied. Section 50C is only a computation provision. Thus the addition made by invoking Section 50C of the Act on the ground that there is a variation in the declared value and the stamp duty valuation of transaction in relation to purchase of agricultural land is hereby deleted.
Coming to the cash deposit of ₹15 lakhs, it has been the constant stand of the assessee that the amount was paid for the purchase of the residential flat, by the husband of the assessee Sri Swapan Kumar Roy, who was a priest at the local temple. The affidavit of Mr. Swapan Kumar Roy reads as follows:
“I Sri Swapan Kumar Roy, son of Anadi Nath Roy, resident of Satgram, Asansol, Dist. Paschim Bardhaman, West Bengal Pin -713337, do solemnly affirm and state as under: 1) That I am a PRIEST by profession since last so many years and I perform the duty of a priest at my temple at “Baba Dhaneswar Nath Mandir”, Post: J.K. Nagar, Beliabathan, PS: J. K. Nagar, Dist. Paschim Bardhaman, W.B. 2) That the above temple is a very old one, dating back more than one hundred years, which I am the care taker and the priest, by way of legacy, and I perform my duty, as a Pujari , every day. 3) That, my regular earnings are derived from the donations and offerings made by all devotees who visits the temple, regularly, and all receipts are in CASH, which I have accumulated over so many years. 4) That I am assessed to Income Tax under PAN: ANWPR3758B, by the ITO, Ward - 2(3), Asansol and I have filed my Income Tax Return for the Asst year: 2014-15, in due course on 02/03/2016. 5) That my wife, Mousumi Roy, (married since the year 1998), is also engaged in the same temple, as a “Tantra Dhari”, (lady assistant to the main Pujari), and performs all the necessary rituals, as required, and keeps custody of all the various offerings, including cash offerings.
Assessment Year: 2014-15 Smt. Mousumi Roy. 6) That till the year 2012, we used to reside in our ancestral house property at Satgram village, and in the FY 2013-14, both of us, decided to purchase a residential flat at Greenfield Realtors at Raniganj City, West Bengal, for Rs. 21,43,700/- (Rs. Twenty One Lakhs Forty Three Thousand Seven Hundred) only, the payment of which has been made from Axis Bank A/c No: XXXXX 7669, which was held in the name of my wife Smt. Mousumi Roy(singally). 7) That the residential flat, purchased at set forth value of Rs. 21,43,700/- was registered in the name of my wife (singally) Smt. Mousumi Roy, (before the ADSR), in the year FY 2013-14, wherein I stay with my wife and son. 8) That out of the total purchase consideration of Rs. 21,43,700/- , I have contributed Rs. 15,00,000/- (Rs. Fifteen Lakhs) in CASH, by way of deposit into the bank account of my wife, which has been subsequently routed to the “Greenfield Realtors” as part purchase consideration of the flat. 9) That, an amount of Rs. 15,00,000/- (Rs. Fifteen Lakhs) is my contribution, duly reflected in my Income Tax Return filed for the Asst year 2014-15, and the balance amount of Rs. 6,43,700/- , is shown as contribution made by my wife in the said property and duly reflected in her Income Tax Return for the Asst year 2014-15 . 10) That in other words, the entire SOURCE of the consideration of the residential flat has been made out of CASH accumulated by both of us over the years, which are earnings and offerings from devotees and visitors of the temple “Baba Dhaneswar Nath Mandir”, and both of us has equal right of ownership on the said collections.”
When Mr. Swapan Kumar Roy states that he has filed his income tax return and that he has earned this amount and has paid the same for the purchase of residential flat, in the name of his wife, in our view, no addition can be made in the hands of the assessee. We notice that this fact was stated by the assessee right from the beginning of the assessment proceedings. She supported her statement with an affidavit from her husband. Confirmation letters are filed. These are not held to be false by the Revenue authorities. They simply disbelieve these evidences without giving any reason. The Revenue has no material to come to a conclusion otherwise. The assessee has no other source of income. The propositions of law laid down by the Hon’ble Supreme Court of India in the case of Smt. P.K. Noorjahan [1999] 237 ITR 570 (SC) is as follows:
“Section 69 of the Income-tax Act, 1961 - Unexplained investment - Assessment years 1968-69 and 1969-70 - Assessee's explanation that investment made in purchase of land came from her step-father was not found satisfactory by Assessing Officer who made addition as income from other sources - Whether, if considered in true perspective word 'may' used in section 69 cannot be read as 'shall' - Held, yes - Whether section 69 confers a discretion on Assessing Officer in matter of treating sources of investment which has not been satisfactorily explained by assessee as income of assessee and he is not obliged to treat such source of investment as assessee's income in each and every such case - Held, yes - Whether Tribunal having held that discretion had not been properly exercised by Assessing Officer in taking into account circumstances in which assessee, a young girl of 20 years, was placed, and having found that sources of investment could not be treated as her income, and High Court having agreed, there could be no error in the above findings - Held, yes” If the Revenue feels that Mr. Swapan Kumar Roy has to be taxed on his investment under the law, if law permits, the assessment of Sri Swapan Kumar Roy may Assessment Year: 2014-15 Smt. Mousumi Roy. be re-opened within the period of limitation and source of income examined. We make it clear that this is not a direction to the AO from the ITAT. The amount cannot be brought to tax in the hands of the assessee as she has no other source of income. Thus on these facts and circumstances this addition of ₹15 lakhs is hereby deleted. This ground of the assessee is allowed.
In the result, the appeal of the assessee is allowed in part. Kolkata, the 22nd October, 2020. Sd/- Sd/- [Aby T. Varkey] [J. Sudhakar Reddy] Judicial Member Accountant Member Dated: 22.10.2020 Bidhan Copy of the order forwarded to:
1. 1. Smt. Mousumi Roy, Vill: Satgram, Lal Bangla, G.T. Road, Asansol-713 337.
2. ITO, Ward-2(2), Asansol.
3. CIT(A), Asansol. (sent through mail) 4. CIT- 5. CIT(DR), Kolkata Benches, Kolkata. (sent through mail)