THE ACIT-1(1), BHOPAL vs. SHRI ASHOK GUPTA, BHOPAL

आदेश /O R D E R

PER SHRI C.M. GARG, JM

This appeal has been filed by the Revenue against the

order of the learned CIT(A)-I, Bhopal, dated 25.2.2016 in

ACIT vs.Ashok Gupta ITA No.564/Ind/2016 First Appeal No. CIT(A)-1/BPL/IT-177/13-14 for the

assessment year 2010-11.

reads as follows :-

“On the facts and in the circumstances of the case, the CIT(Appeal) has erred in – 1. Whether, on the facts and circumstances of the case, the ld. CIT(A) erred in deleting the addition of Rs.42,00,000/- whereas the assessee has not discharged his onus of proving that the sale transaction does not pertain to him since the assessee has not furnished any document of the alleged sellers as to where the income from capital gains has been reflected.”

trading of Offset Printing Press. The assessee filed the return of

income on 4.10.2010 showing total income of Rs. 44,93,640/-.

Notice u/s 143(2) of the Act was issued on 7.9.2011. In the profit

and loss account, the assessee had shown gross receipts of

Rs.6,15,50,128/- with net profit ofRs. 45,47,048/-. In addition, the

assessee has also earned interest income of Rs.97,033/- and

claimed loss of Rs.50,447/-under the head ‘House Property’

against self occupied residential house. The assessee was asked to

furnish details of purchase and sale of immovable property in 2

ACIT vs.Ashok Gupta ITA No.564/Ind/2016 response to which the assessee submitted that on 18.12.2009 he

has made only one sale transaction in the capacity of partner of

M/s Drishti Builders and Developers. However, as per AIR

information, during the year, the assessee had entered into two

transactions of sale of immovable property. One of them pertains to

the sale of property on behalf of the firm in which the assessee is a

partner, whereas on 30.9.2209, the assessee has sold another

property at Rs. 42,00,000/- which he has not mentioned anywhere.

Vide his reply dated 18.3.2013 the assessee again reiterated that

“the assessee has neither purchased nor sold the pieces of land in

his individual capacity”. However, the assessee contended before

the Assessing Officer that the assessee’s PAN is also quoted in

another sale deed dated 30.9.2009 in fvour of Smt. Vibha Gupta

w/o Shri Ashok Gupta in which the assessee had signed on behalf

of registered owner and seller by obtaining a general power of

attorney from the owners of the land. However, the assessee has

not discharged the onus of proving that the sale transaction does

not pertain to him since the assessee has not furnished any

document of the alleged sellers asa to where the income from

capital gain has been reflected. The Assessing Officer observed that 3

ACIT vs.Ashok Gupta ITA No.564/Ind/2016 the assessee has also not shown any income from capital gains in

the computation of income. In the wake of these facts, the

Assessing Officer added Rs. 42,00,000/- on account of sale of

immovable property to the total income of the assessee as

undisclosed income.

the assessee preferred first appeal before the learned CIT(A). During

the course of hearing before the learned CIT(A), the assessee filed

an application under Rule 46A submitting additional evidence in

the form of agreement to sell which was forwarded by the learned

CIT(A) to the Assessing Officer calling for his remand report. In

response, the Assessing Officer submitted the remand report on

12.1.2016 . After considering the facts of the case, submissions of

the assessee and the remand report of the Assessing Officer, the

learned CIT(A) observed as under :-

“10. Looking to the facts of the case and the submission, it is

seen that the appellant in this case has acted as the power of

attorney holder for the sellers Smt. Kanti Rghu and Smt.

Santosh Mehrotra. The buyer was Smt. Vibha Gupta, who is the

wife of the appellant. At the time of the registration of the 4

ACIT vs.Ashok Gupta ITA No.564/Ind/2016 property, the PAN of the power of attorney holder i.e. the

appellant was mentioned in the sale deed which was picked up

by the AIR transactions and was subsequently reported to the

department. However, as the appellant had not sold the

property, therefore, the addition made by the A.O. of

Rs.42,00,000/- in the assessment order holding that this

amount is on account of sale of immovable property by the

appellant is not correct and the addition made in the

assessment order is therefore deleted. The ground of appeal is

allowed and the appellant gets relief on this account.”

In view of the above findings, the learned CIT(A) deleted the addition

made by the Assessing Officer.

Tribunal.

perused the relevant material placed on record of the Tribunal,

inter-alia, assessment order, impugned first appellate order, paper

book filed by the assessee spread over 42 pages and other relevant

material placed on record of the Tribunal.

ACIT vs.Ashok Gupta ITA No.564/Ind/2016 7. The learned DR supporting the action of the Assessing Officer

submitted that the learned CIT(A) has erred in deleting the addition

of Rs. 42 lacs whereas the assessee has not discharged his onus of

proving that the sale transaction does not pertain to him. The

learned DR vehemently contended that since the assessee has not

furnished any document of the alleged sellers as to wherefrom the

income as capital gains has been reflected then the addition made

by the Assessing Officer on sole grounds cannot be dismissed.

Drawing our attention to para 4 of the assessment order, the

learned DR submitted that the computation of income furnished by

the assessee does not contain any income from capital gains

whereas the AIR information received by the Assessing Officer

clearly shows that during the year the assessee has entered into

two transactions of sale of immovable properties out of which one

pertained to the sale of the property on behalf of the firm in which

the assessee is a partner and the assessee has also sold another

property at Rs.42 lacs on 30.9.2009, which the assessee has not

shown anywhere including the computation of income.

relief to the assessee without any justification and reasoning. 6

ACIT vs.Ashok Gupta ITA No.564/Ind/2016 Therefore, the same may be set aside by restoring the order of the

Assessing Officer.

contended that before the Assessing Officer the assessee vide reply

dated 18.3.2013 submitted that the assessee has neither purchased

nor sold the pieces of land in his individual capacity and the

assessee only executed the sale deed in favour of Smt. Vibha Gupta

on behalf of the registered owner by obtaining a general power of

attorney from the owners of the land. Therefore, no long term

capital gain or any other income can be alleged in the hands of the

assessee for making the addition.

attention towards paras 6 to 10 of the first appellate order and

submitted that the assessee filed all relevant papers as additional

evidence before the learned CIT(A) under the provisions of Rule 46A

of the Income Tax Rules, 1962 and after obtaining the remand

report and considering the rejoinder of the assessee to the remand

report, the learned CIT(A) rightly held that the assessee has acted

as a power of attorney holder for the seller Smt. Kanti Raghu and

Smt. Santosh Mehrotra and at the time of registration of sale deed, 7

ACIT vs.Ashok Gupta ITA No.564/Ind/2016 PAN of power of attorney holder i.e. the assessee was mentioned in

the sale deed which was wrongly picked up by AIR information and

reported to the Assessing Officer. The learned counsel for the

assessee vehemently pointed out that the Assessing Officer without

applying his mind to the information and the material, proceeded to

make the addition without any basis which was rightly deleted by

the learned CIT(A), hence the first appellate order may kindly be

upheld.

careful reading of the first appellate order, we observe that neither

the Assessing Officer nor the learned DR during the course of

arguments, could controvert this fact that the assessee merely

acted as power of attorney holder of the sellers - Smt. Kanti Raghu

and Smt. Santosh Mehrotra – and at the time of execution and

registration of the sale deed, the assessee mentioned his PAN

perhaps as per the requirements of the registration department and

this created a doubt in the mind of the Assessing Officer which

resulted into impugned addition. Obviously, when the assessee is

neither the owner of the land nor beneficiary of the sale

consideration and he merely acted on behalf of the sellers under the 8

ACIT vs.Ashok Gupta ITA No.564/Ind/2016 power of attorney then it cannot be alleged against the assessee

that the assessee has earned the income on sale of such property

and the entire sale consideration is the income of the assessee. In

our considered opinion, the view taken by the learned CIT(A) on the

basis of evidence placed before him, remand report of the Assessing

Officer and the rejoinder of the assessee, is quite justified and

sustainable and we are unable to see any valid reason to interfere

with the same. Accordingly, the sole ground of the revenue, being

de void of any merit, is dismissed.

The order has been pronounced in open Court on 28th

February, 2017.

Sd/- sd/-

लेखा सद�य �या�यक सद�य (O.P.Meena) (C.M. Garg) Accountant Member Judicial Member

February 28th , 2017. Dn/