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Facts
The assessee appealed against an assessment order for AY 2009-10 made under sections 147/144 of the Income-tax Act. The appeal challenged the validity of the notice issued under section 148, the classification of a property sale as short-term capital gain, the disallowance of expenses claimed under section 48 for land improvement, and an addition made for unexplained cash deposit under section 69.
Held
The Tribunal dismissed the appeal, concurring with the findings of the lower authorities. It found no material to substantiate the claim that the notice under section 148 was issued without application of mind, upheld the classification of the property sale as a short-term capital gain, and sustained the disallowance of unsubstantiated expenses under section 48. Furthermore, the addition of unexplained cash deposit under section 69 was confirmed due to the lack of valid justification or evidence from the assessee.
Key Issues
Validity of notice under section 148; classification of property sale as short-term capital gain; allowability of land improvement expenses under section 48; addition for unexplained cash deposit under section 69.
Sections Cited
147, 144, 148, 48, 69
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, DELHI BENCH “A”: NEW DELHI
Before: SHRI M. BALAGANESH & SHRI ANUBHAV SHARMA
O R D E R PER ANUBHAV SHARMA, JM: The assessee has come in appeal against the order dated 27.03.2018 passed by the Commissioner of Income Tax (Appeals)-2, Noida (hereinafter referred as “learned First Appellate Authority” or in short “FAA”) in Appeal no. E-174/2016- 17/GZB, for the assessment year 2009-10, arising out of the assessment order dated 31.08.2016 u/s 147/144 of the Income-tax Act, 1961 (hereinafter referred as the “Act”), passed by the Income-tax Officer, Ward-1(5), Ghaziabad (hereinafter referred in short as “Ld. AO”).
None appeared for the assessee at the time of hearing and record shows notices have been issued repeatedly. Report is received that address of assessee is incomplete. Notices have also been issued on fresh address provided by the Revenue and through e-mail. Ever since the institution of appeal, the matter is listed on 12 occasions. No more notice is justified. Arguments of learned DR were heard, who supported the findings of learned tax authorities below.
As we appreciate the matter on record, it comes up that as regards ground no. 1, there is no material before us to consider the allegation that notice u/s 148 was issued without application of mind. On the contrary presumption is that official acts are done in due course of law. In the light of aforesaid, ground no. 1 is also decided against the assessee.
As regards ground no. 2, it comes up that this addition is made on the basis that assessee had sold immovable property worth Rs. 1,07,51,000/- during the year which included property in the form of land bearing khasra no. 3015 village & Pargana Dasna tehsil Ghaziabad, which assessee had claimed to be more than ten kms. away from headquarter of Municipal Corporation, Ghaziabad. However, the certificate issued by the Tehsildar Ghaziabad was disbelieved being ambiguous and the sale was considered to be a short term capital gain. There is no material before us to hold a different opinion. Ground no. 2 is also decided against the assessee.
As regards to ground no. 3, it comes up that addition was made on the basis that AO had disallowed the expenses claimed u/s 48 for land filling etc. The order of learned authorities below show that the expenditure denied is of the nature of soil filling and boundary wall as cost of improvement of the property purchased as back as on 25.05.2006. The burden was on the assessee to establish the same and except for filing bills of same from a contractor, there was no other evidence that how the property was made beneficial with this land filling exercise. Thus, learned tax authorities below have rightly disallowed the expenditure. Ground no. 3 has no substance.
As regards to ground no. 4, issue involved is the addition of Rs. 59,05,000/- made on account of cash deposited by the assessee in the Punjab National Bank, which was considered unexplained money u/s 69 of the Act. As such the assessment before learned AO was concluded u/s 147/144. Learned CIT(A) had allowed the additional evidence and remand report was called from the AO.
Learned CIT(A) has dealt the issue. We concur with the observations of learned CIT(A) that in the absence of any valid justification or evidence, the claim of assessee that the cash deposit in the bank account should be considered to be made out of cash withdrawals on the previous occasions, cannot be sustained. Thus, ground no. 4 is decided against the assessee.
Consequently, the appeal of the assessee is dismissed.
Order pronounced in open court on 05.03.2024.