SH. SUBHASH CHAND ARORA,MUZAFFARNAGAR vs. ITO, MUZAFFARNAGAR

This appeal filed by the assessee is directed against the order dated 16.12.2015 of CIT(A), Muzaffarnagar relating to assessment year 2011-12.

This appeal was earlier dismissed by the Tribunal for non-prosecution. Subsequently, the Tribunal vide MA No.424/Del/2016 order dated 11.08.2017 recalled its earlier order. Therefore, this is a recalled matter. 3. Facts of the case, in brief, are that the assessee is an individual and filed his return of income on 19.03.2013 showing taxable income of Rs.2,12,820/-. During the course of assessment proceedings, the Assessing Officer observed that the assessee has purchased agricultural land jointly with Shri Ankur, Son of Shri Rajendra Prasad and Shri Mukesh Kumar, Son of Shri Ghanshyam in Village Lohari (Distt. Udhamnagar) for total consideration of Rs.52,53,000/- on 23.09.2010 and of Rs.52,36,000/- on 29.01.2011. The assessee had invested an amount of Rs.37,27,334/- being 1/3rd holding/ownership including expenses of registration etc. On being confronted by the Assessing Officer, it was stated by the assessee that he has invested an amount of Rs.18,66,667/- on the land purchased on 23.09.2010 and an amount of Rs.18,60,667/- on 29.01.2011. The total investment thus comes to Rs.37,27,334/-. An amount of Rs.8,00,000/- was taken as loan from wife and amount of Rs.4,00,000/- was taken as loan from Ritik Chabra and the balance of amount of Rs.29,27,334/- was invested out of advance received from one Shri Dulal relating to proposed deal for sale of land. From the copy of agreement as filed, the Assessing Officer noted that the agreement was not signed by any witness and there was no clause of right to get the registration through court in case, registration is not effected for any short coming of the assessee. He, therefore, asked the assessee to produce said Dulal for his examination and ascertain the availability of cash as per terms in the said agreement. Since the assessee did not produce Shri Dulal, the Assessing Officer disbelieved the availability of huge funds in the hands of the assessee. After allowing an amount of Rs.9,00,000/- which was received by the assessee on account of sale deed dated 14.12.2010, the Assessing Officer made addition of Rs.20,20,000/- to the total income of the assessee.

In appeal, the ld. CIT(A) upheld the addition made by the Assessing Officer.

Aggrieved with such order of the ld. CIT(A), the assessee is in appeal before the Tribunal.

I have considered the rival arguments made by both the sides and material available on record. I find the addition of Rs.20,20,000/- was made by the Assessing Officer on account of non-production of Shri Dulal before him to substantiate with evidence to his satisfaction regarding the availability of such huge funds with the said person. Since nothing was stated before the ld. CIT(A), he upheld the addition so made by the Assessing Officer. It is the submission of the ld. counsel for the assessee that given an opportunity, he will produce Shri Dulal before the Assessing Officer for his examination and substantiate with evidence to his satisfaction regarding the availability of such huge funds with him. Considering the totality of the facts of the case and in the interest of justice, I deem it proper to restore the issue to the file of the Assessing Officer with a direction to give an opportunity to the assessee to produce Shri Dulal before him for his examination. The Assessing Officer shall decide the issue as per fact and law after giving due opportunity of being heard to the assessee. I hold and direct accordingly. The grounds raised by the assessee are accordingly allowed for statistical purposes.

In the result, the appeal filed by the assessee is allowed for statistical purposes.