ITO, MOHINDERGARH vs. SH. PARMANAND SAINI PROP., HARYANA

O R D E R PER S.V. MEHROTRA, A.M :

This is an appeal filed by the Revenue against the order dated 05.01.2015 passed by the Commissioner of Income Tax (Appeals), Rohtak, u/s 143(3) of the Income Tax Act, 1961 (in short “the Act”) relating to A.Y. 2011-12. 2. Brief facts of the case are that the assessee filed return of income declaring net income of Rs.1,51,300/-. From the Balance Sheet filed by assessee for the Assessment Year 2010-11, the Assessing Officer noted that there was no fixed asset with the assessee. However, the perusal of Balance Sheet for the Assessment Year 2011-12 revealed that the assessee had shown fixed assets at Rs.13,54,870/- under the head ‘land and building’.

The Assessing Officer has given at page 2 of his order the details filed by the assessee under the head ‘fixed assets’ and has drawn his conclusion from the same which is reproduced hereunder :-

Fixed Land & Building 01-04-2010 to 31-03-2014 Date Particulars Vch. Type Vch. Debit Credit No. 19.05.2010 Cr Cash Payment 72 10,40,000 10.06.2010 Dr Cash Receipt 77 9,50,000 14.06.2010 Dr Cash Receipt 82 3,50,000 22.06.2010 Dr Cash Receipt 91 8,00,000 09.07.2010 Dr Cash Receipt 112 6,00,000 07.10.2010 Cr Cash Payment 279 10,00,000 18.18.2010 Cr Cash Payment 291 5,00,000 21.10.2010 Cr Cash Payment 294 2,25,000 15.12.2010 Cr Cash Payment 318 3,80,000 21.01.2011 Cr Cash Payment 332 4,17,000 02.02.2011 Cr Cash Payment 336 2,20,870 16.03.2011 Cr Cash Payment 348 2,72,000 40,54,870 27,00,000 Closing Balance 13,54,870 40,54,870 40,54,870 The assessee furnished another details of fixed assets as on 31.03.2011 details of which are as under: Name of Property Amount Date of Purchase 1. Plot at NNL 300000/- 08-06-1999 2. Godown at M/garh 50000/- 30.03.1999 3. Agricultural land (M/garh) 3K- 7m 250000/- 02.05.2001 4. Agricultural land (M/garh) 3k -1/2 120000/- 12.08.2004 share 5. Agricultural land (M/garh) 10k -0m 725000/- 25.11.2010 6. Plot sainipura moh. (adv.) B-1/74 1000000/- 16.11.2010 7. Plot 19 Marla 300000/- 23.03.2010 8. Plot at Tobra Ateli, 253 sq 1040000/- 28.05.2010 28,85,000/- From the details narrated above it is very much clear that both of the details filed by the assessee in respect of fixed asset are contradictory to each other. Further as per balance sheet for the assessment year 2010-11 filed by the assessee no fixed assets has been shown by the assessee whereas the assessee having fix asset worth Rs.18,45,000/- up to 23.03.2007 meaning thereby the assessee himself is not in a position to disclose the true facts of his assets and the details furnished by the assessee are only on estimated basis.”

“ii) During the course of assessment proceedings the assessee was asked to furnish the sale deed of property no.25 situated at Subzi Mandi, M/garh as claim to be sold for Rs.27,00,000/- but no sale deed has been furnished by the assessee meaning thereby that no such property has been sold. Thus it is only cooked story and no such alleged gift was made by Smt. Kiran Devi.”

“However, in the body of assessment order the AO got confused from the tables submitted on three separate occasions by the assessee during the assessment proceedings. The assessee submitted first table showing therein the financial status of fixed assets during 01.04.2010 to 30.03.2011 under the heading ‘Fixed Land and Building’. The second table was submitted showing fixed assets as on 31.03.2011 in which the assessee gave details of all the assets acquired since 1999 till 31.03.2011. The third table was submitted on 20.02.2014 during assessment proceedings which was the repetition of second table except the last item shown as stamp paper expenses of Rs.2,69,870/-. As per the assessment order, it is proved beyond doubt that books of accounts were maintained in regular course of business and examined by the A.O. and found it correct. The addition of Rs.27,00,000/- is totally unjustified and against law and may kindly be deleted.”

“i) “On facts and in the circumstances of the case the Ld. Commissioner of Income tax (Appeals) has erred in deleting the addition of Rs. 27,00,000/- as this amount was received as an advance by the wife of the assessee against sale of shop. However, the A.O. has held that Rs. 27,00,000/- as claimed as alleged gift and the assessee had not discharged his onus regarding the alleged gift." ii) On facts and in the circumstances of the case the Ld. CIT(A) has erred in deleting the addition of Rs. 13,54,870/- as this amount was unexplained investment." iii) That the appellant is filling appeal as the case is covered under the exception as per para 8(a) of instructions 3 of 2011 issued by CBDT. iv) That the appellant craves for permission to add, delete or amend the grounds of appeal before or at the time of hearing of appeal.”

7. Ld. DR submitted that assessee never produced any sale deed before the Assessing Officer to establish the source of gift by wife of Rs.27,00,000/-. He referred to page 2 of order of Ld. CIT(A) and pointed out that no clear finding has been given by Ld. CIT(A). In respect of ground no.2, Ld. CIT(A) has not given any clear finding regarding source of investment.

8. Ld. counsel referred to the submissions made before Ld. CIT(A) and pointed out that agreement to sell between Smt. Kiran Devi (wife) and Shri Kehar Singh and Shri Satish Kumar was filed before Ld. CIT(A) and the Hindi copy of the same was also filed.

9. As regards balance investment of Rs.13,54,870/-, Ld. counsel submitted that the same is from regular books of account and, therefore, no addition is called for.

10. I have considered the submissions of both the parties and have perused the record of the case. As noted earlier, the Assessing Officer has clearly observed at page 5 of his order that no sale deed had been furnished by the assessee in regard to alleged sale of property in the name of wife Smt. Kiran Devi. Ld. CIT(A) has also not recorded any specific finding on this crucial aspect. Under such circumstances, it would be appropriate to restore the matter back to the file of the Assessing Officer for de novo consideration of facts. I order accordingly.

11. As far as the source regarding balance investment of Rs.13,54,870/- is concerned, the Assessing Officer will examine the books of account in this regard and if the investment is from explained sources in the regular books of account then no addition is called for.