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Facts
The assessee filed an ITR with a total income of Rs. 4,71,600/-. The AO, during scrutiny assessment under Section 143(3) read with Section 144B, added Rs. 51,06,33,000/- as unexplained investment under Section 69 for the purchase of immovable property, alleging failure to substantiate the source. The assessee contended she purchased only 43 plots from her husband for Rs. 1,32,34,500/- through three sale deeds. The CIT(A) called for a Remand Report, in which the AO himself confirmed the assessee's claim, leading the CIT(A) to delete the addition.
Held
The Income Tax Appellate Tribunal upheld the order of the CIT(A), finding no reason to interfere. The Tribunal noted that the AO's own Remand Report corroborated the assessee's claim of having purchased only 43 plots for a consideration of Rs. 1,32,34,500/-, confirming the genuineness of her claim. Consequently, the Tribunal concluded that Section 69 of the Act was not applicable to the present case.
Key Issues
Whether the CIT(A) was justified in deleting the addition under Section 69 for unexplained investment, where the AO's Remand Report confirmed the assessee's stated purchase value and genuineness of the transaction.
Sections Cited
143(3), 144B, 69
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Income Tax Appellate Tribunal, VISAKHAPATNAM “DIVISION” BENCH, VISAKHAPATNAM
Before: SHRI V. DURGA RAO, HON’BLE & SHRI S BALAKRISHNAN, HON’BLE
आदेश /O R D E R
PER V. DURGA RAO, JM:
The captioned appeal is filed by the revenue against order of the Learned Commissioner of Income Tax (Appeals), National Faceless Appeal centre, Delhi [hereinafter in short “Ld.CIT(A)”] vide DIN & Order No.
ITBA/NFAC/S/250/2024-25/1074280074(1) dated 10.03.2025 for the A.Y.2022-23 arising out of order passed under section 143(3) of the Income Tax Act, 1961 (in short ‘Act’) dated 15.03.2024.
Brief facts of the case are, assessee is an individual filed her return of income declaring total income of Rs.4,71,600/-. The case was selected for scrutiny under CASS and after following the due procedure assessment was completed on 15.03.2024 under section 143(3) r.w.s. 144B of the Act. In the assessment order, Ld. AO gave a finding that as per the information available with the department, assessee is involved in the purchase of immovable property to the tune of Rs.51,06,33,000/- and the assessee has failed to substantiate the source of purchase with any documentary evidences. Therefore, Ld. AO added the entire amount of Rs.51,06,33,000/- as unexplained investment as per provisions of section 69 of the Act. Assessee has submitted all the details before Ld. AO by stating that she has purchased only 43 vacant residential plots from her husband through three sale deeds. However, Ld. AO not accepted the explanation of the assessee.
On appeal, it was submitted before the Ld. CIT(A) that assessee only purchased 43 plots through three Registered Sale deeds amounting to Rs.1,32,34,500/-. The Ld. CIT(A) by considering the submissions, he called for Remand Report from the Ld. AO. In the Remand Report the Ld. AO admitted
Page No. 2 that the assessee purchased only 43 plots and observed that on verification of the sale deed document No. 244 / 2022 it is observed the applicant has purchased 15 plots for a consideration of Rs. 47,28,000/- but the amount considered by the Ld.AO in the assessment order was Rs. 7,09,20,000/-. On verification of the sale deed Document No. 246/2022, it is observed that the applicant has purchased 15 plots for a consideration of Rs. 46,06,500/- but the amount considered by the Ld.AO is Rs.6,90,97,500/-. On verification of the sale deed document No. 236/2022, it is observed that the applicant has purchased 13 plots for a consideration of Rs. 39,00,000/- but the amount considered by the Ld. AO is of Rs. 5,07,00,000/-. The Ld. CIT(A) by considering the above, deleted the addition made by the Ld. AO and allowed the appeal filed by the assessee.
On being aggrieved, revenue is in appeal before us by raising following grounds of appeal: - “1. Order of the Ld. Commissioner of Income Tax (Appeals), NFAC is erroneous on facts and law.
2. The Ld CIT(A) ought to have uphold the addition of Rs.1,32,34,500/- made by the FAO towards unexplained investment u/s69 of the I.T. Act by considering the factual report submitted by the Assessing Officer that the appellant has purchased 43 plots for a total purchase consideration of Rs.1,32,34,500/-; 3. The Ld.CIT(A) ought to have upheld the addition made by the FAO of Rs.1,32,34,500/- towards unexplained investment u/s.69. of the I.T.Act by appreciating the content mentioned in all the registered purchase deeds which shows that it is agreed by both the purchaser and seller to transfer the property under consideration and also agreed that the corresponding
Page No. 3 purchase consideration has been exchanged at the time of registration itself: 4. The Ld.CIT(A) ought to have appreciated that it is only an afterthought of the assessee that she paid the purchase consideration through banking channel in subsequent year, that too, after completion of scrutiny assessment under consideration; 5. The Ld.CIT(A) ought not to have accepted the appellant's contention that her husband agreed to her proposal to make the payment of purchase consideration out of the sale proceeds received by her as and when she sells the said plots in future; 6. The Ld.CIT(A) is not justified in accepting the assessee's claim of alleged evidence in the form of copy of the assessee's ledger account in the books of her husband Sri. Ravi Rajavarapu for the financial years 2021-22 and 2022-23 since it is an afterthought of the assessee to deny the addition made by the FAO towards unexplained investment made u/s.69 of the I.T.Act; 7. The Ld.CIT(A) ought to have upheld the addition made by the FAO of Rs.1,32,34,500/- towards unexplained investment u/s.69 of the I.T.Act by appreciating the action of FAO since the explanation offered by the assessee is not, in the opinion of the Assessing Officer, satisfactory in respect of the value of the investments.
Any other ground(s) that may be urged at the time of hearing.”
The Ld. Departmental Representative [hereinafter in short “Ld. DR”] submitted that the Ld. AO in the Remand Report noted that addition has to be made in the hands of the assessee of Rs.1,32,34,500/- and submitted that Ld.CIT(A) without considering the Ld. AO’s Remand Report properly deleted the addition.
On the other hand, Ld. Authorised Representative [hereinafter “Ld.AR”] submitted that assessee only purchased 43 plots for a sale consideration of Page No. 4 Rs.1,32,34,500/-, all the amounts paid subsequently in 2023-24 as per paper book Page No. 186 and submitted that section 69 of the Act has no application.
We have heard both the sides and perused the records and gone to the orders of the authorities below. In this case, the Ld. AO without making any enquiry simply made an addition of Rs.51,06,33,000/-. When the assessee carried the matter before Ld. CIT(A), Ld. CIT(A) called for Remand Report, in that Remand Report the Ld. AO has clearly mentioned that the assessee has purchased only 43 plots for a consideration of Rs. Rs.1,32,34,500/- and the claim of the assessee is genuine. Based on the report given by the Ld. AO, the Ld.CIT(A) deleted the addition made by the Ld. AO. The case of the assessee is that the assessee has purchased 43 plots from her husband for a sale consideration of Rs.1,32,34,500/- which is confirmed by the Ld. AO in the Remand Report. Payments were made subsequently which is evidenced from the paper book page No. 186 and the assessee paid the entire sale consideration as below:
Details of purchase Date of Payment for Sl.No. documents cheques to her husband 1. Doc. No. 236/2022 21.08.2024 2. Doc No. 244/2022 30.07.2024 3. Doc. No. 246/2022 29.07.2024
In view of the above and by considering the entire facts and circumstances of the case, we are of the opinion that section 69 of the Act has no application in Page No. 5 the present case and we find no reason to interfere with the order passed by the Ld. CIT(A). Accordingly, grounds raised by the revenue are dismissed.
In the result, appeal filed by the revenue is dismissed.
Order pronounced in the open court on 12th June, 2025.
Sd/- Sd/- (िी. दुर्ाा राि)Sd/- (एस बालाकृष्णन) (S. BALAKRISHNAN) (V. DURGA RAO) लेखा सदस्य/ACCOUNTANT MEMBER न्याधयक सदस्य/JUDICIAL MEMBER Dated : 12/06/2025 Giridhar, Sr.PS
आदेशकीप्रनतनलनपअग्रेनर्त/ Copy of the order forwarded to :- 1. निर्धाररती/ The Assessee : Annapurna Rajavarapu Flat No. A2, Srihari Vasam 1/1 Vidya Nagar, Guntur – 522007 Andhra Pradesh
रधजस्व/ The Revenue : Income Tax Officer Standard House, Nagaramapalem Guntur – 522004, Andhra Pradesh 3. The Principal Commissioner of Income Tax नवभधगीयप्रनतनिनर्, आयकरअपीलीयअनर्करण, नवशधखधपटणम/DR,ITAT, Visakhapatnam 4. 5. The Commissioner of Income Tax 6. गधर्ाफ़धईल/ Guard file आदेशधिुसधर / BY ORDER Sr. Private Secretary ITAT, Visakhapatnam
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