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Income Tax Appellate Tribunal, DELHI BENCH: ‘SMC-II’ NEW DELHI
Before: SMT DIVA SINGH
ORDER The present appeal has been filed by the assessee assailing the correctness of the order dated 15.05.2015 of CIT(A)-1, Gurgaon pertaining to 2010-11 assessment year on various grounds. However, at the time of hearing, the Ld.AR argued only Ground Nos. 3 &
4. The same are reproduced hereunder for ready-reference:-
3. “That on the facts and circumstances of the case and in law, the Ld. Commissioner erred in not appreciating the fact that the Appellant was not granted any opportunity to cross-examine the persons whose statements have been relied upon by the Assessing Officer for making adverse inferences against the Appellant.
4. That on the facts and circumstances of the case and in law, the Ld. Commissioner erred in not appreciating the fact that the statements of the persons relied upon by the Assessing Officer have been recorded behind the back of the Appellant and that no opportunity has been granted to the Appellant to confront the same.”
Addressing the same, it was his limited request that the issue be restored back to the AO so that the assessee is provided an opportunity to cross-examine the persons whose alleged statements have been relied upon by the tax authorities. In the facts of the present
I.T.A .No.-4686/Del/2015 case, it was his submission that there is an Agreement to Sell admittedly on record which has been signed by the parties. The conclusion drawn by the tax authorities that the parties pleaded no such Agreement had been signed is contrary to fact and record. The prayer for time was sought for filing a Paper Book which contains an affidavit of Sh.Gopal Singh Chauhan wherein he owns up that the transactions were done by him. The affidavit of Sh.Gopal Singh Chauhan signatory of the Agreement it was submitted states that he did not understand what was being asked by the Inspector of the Income Tax. It was argued that the Inspector had no authority to administer oath under the provisions of the Income Tax Act, 1961.
The Ld. Sr. DR submitted that the CIT(A) has given a finding that the statement has been recorded by the AO who had the authority to administer oath u/s 131 of the Income Tax Act, 1961. However, it was his submission that admittedly opportunity to cross-examine has not been given to the assessee which may be provided.
Both the parties have been heard. It is seen that the assessee’s return was picked up for scrutiny and explaining the cash deposits amounting to Rs.30,78,500/- in specific bank account in Syndicate Bank A/c No.82462010009620 the assessee explained that Rs.19.50 lakhs, was an advance in respect of sale of plot; apart from that there was income from salary; consultancy; agricultural income; sale of car etc. The assessee further explained that the Agreement to sell was executed on 03.03.2010 between the Satyendra Yadav i.e. the assessee as a seller and Sh.Sahab Singh and Sh.Gopal Singh Chauhan as purchasers for which Rs.19.50 lakhs was received. The specific land was described as 1000 sq yard, Khasra No.224 situated in the revenue estate of Lal dora Vill. Khaira, Najafgarh, New Delhi-110043, Abadi known as extended Lal Dora.
I.T.A .No.-4686/Del/2015
In pursuance to the said agreement, it has been stated that the purchasers had given advance of Rs.19.50 lakhs to seller on 03.03.2010 and the time for registration of sale deed had been agreed to as on or before 03.072010. Since the specific sale deed was not executed the assessee as per affidavits dated 30.10.2012 extracted in para 3.1 of the assessment order stated that he had received the amount from Sh.Shab Singh and Sh.Gopal Singh Chauhan against an Agreement to Sell and since they did not execute the sale deed the amount was forfeited. The tax authorities relied upon the statement wherein Sh. Shab Singh stated that he did not know the assessee who infact was known to his Son Sh. Pankaj Yadav, Sh. Gopal Singh Chauhan son of Sh.Jagdish Singh Chauhan R/o-Village-Wazirpur, Distt.-Gurgaon stated that he knew the assessee but he did execute any such agreement.
It is seen that based on these facts, the assessee’s claim was disallowed and the addition was made in the hands of the assessee, holding that the assessee has introduced unaccounted income in his bank account. The said finding was confirmed in appeal by the CIT(A). Before the CIT(A) the assessee did not raise the issue whether the statement was recorded by the AO or by the Inspector. The issue even before us has not been raised in the present proceedings by the Ld.AR who clarified that he has merely sought an opportunity to cross-examine Sh.Gopal Singh Chauhan and Sh. Shab Singh. Referring to the assessment order, it was submitted in para 3.2 that Sh. Shab Singh is supposed to have said that he did not know Sh. Satyendra Yadav for which purposes he sought an opportunity to place on record as evidence affidavit of his son.
I find that in the peculiar facts and circumstances of the present case, it can not be conclusively decided whether it is unexplained income of the assessee or not . In the facts of the present case admittedly, the assessee is having same consultancy income stated to be related to real estate etc. However, the fact which remains on record is that at the relevant Page 3 of 4
I.T.A .No.-4686/Del/2015 point of time the assessee was in the possession of a specific piece of land. The Agreement to Sell is in regard to the said land. It is stated to be signed by all the three parties.
However, I find that no attempt has been made by anyone to see and authenticate the signatures of the parties. The facts need to be appreciated afresh. It needs to be ascertained whether the land continues to still vest with the assessee or was it assigned to some other party who proceeded to execute the sale on the basis of the very same payment made by Sh. Shab Singh and Sh. Gulab Singh Chauhan. The facts are not clear and the evidences sought to be admitted are crucial for determining the same. Thus considering the prayer of the parties, the issue is restored back to the file of the AO with a direction to provide an opportunity to cross-examine these two persons. The assessee also is provided an opportunity to place the evidences it deems fit in support of its claim.