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Income Tax Appellate Tribunal, “SMC” – ‘C’ BENCH, CHENNAI
Before: SHRI CHANDRA POOJARI
आदेश /O R D E R
This appeal by the assessee is directed against the order of the Commissioner of Income-tax(Appeals)-14 dated 20.06.2016 for assessment year 2012-13.
The grievance of the assessee in this appeal is with regard to confirming the assessment of ₹40 lakhs on the - - 2 ITA 2296/Mds/16
application of sec.68 of the Act in the computation of taxable total income without assigning proper reasons and justification.
The facts of the case are that for the assessment year 2012-13, the assessee filed return of income belatedly on 29.8.2012. In the said return of income the assessee disclosed the following particulars of capital gains on account of sale of a property in Thanjavur as under : : ₹ 19,23,800 Sale price : ₹ 11,05,634 Indexed purchase price : ₹ 8,19,166 Capital gain Subsequently, a revised return of income was filed on 26.10.2012, wherein the above particulars were shown as under: : ₹ 60,00,000 Sale price : ₹ 8,48,322 Indexed purchase price : ₹ 51,51,678 Capital gain 3.1 The Assessing Officer during the course of assessment proceedings called for and verified the copies of bank statement, purchase deed and other relevant documents and found that an amount of ₹ 40 lakhs in cash was credited to the bank account of the assessee on 2.2.2012. When the AO called for the source of the cash deposit, the assessee submitted that ₹ 40 lakhs was - - 3 ITA 2296/Mds/16 received in cash as sale proceeds of the property situated at 6th cross, Natarajapuram South, Thanjavur. The AO observed that as per the copy of the sale deed dated 02.02.2012 in respect of the said property, the plot was sold for ₹19,24,800/- only. The AO issued summons u/s.131 to the purchaser of the plot, Shri Sakthivel and recorded a sworn statement from Shri Sakthivel on 8.1.2015. In the sworn statement, Shri Sakthivel stated that he has paid ₹20,00,000/- only towards the purchase of the plot. Therefore, according to the AO, the assessee failed to submit any evidence in respect of his claim that excess of sale proceeds received were deposited in his bank account. The unexplained cash deposit of ₹ 40 lakhs was treated as unexplained income u/s.68 of the Act under the head ‘income from Other Sources’ and the AO added an amount of ₹ 40 lakhs u/s.68 as unexplained cash deposit to the total income of the assessee. Aggrieved, the assessee went in appeal before the CIT(Appeals).
On appeal, the CIT(Appeals) observed that the assessee filed the original return of income for the A.Y. 2012-13 on 29.8.2012, beyond the due date for filing of the return i.e.
- - 4 ITA 2296/Mds/16 31.7.2012. A revised return of income was filed on 26.10.2012. The CIT(Appeals) relied on the judgment of the Supreme Court in the case of Kumar Jagdish Chandra Sinha v. CIT (86 Taxman 122)(SC), wherein it was held as under :
“Section 139(5) of the Income Tax Act, 1961 – Return of income – Revised return – Assessment years 1964-65 to 1965-66 – Whether, in case of a return filed under section 139(4), a revised return contemplated by section 139(5) can be filed – Held, no.” The CIT(Appeals) followed the decision of the Supreme Court cited supra and observed that the revised return filed by the assessee on 26.10.2012 is held to be an invalid return.
4.1 The CIT(Appeals) observed that the AO has rightly held that the assessee failed to prove with evidence his contention that an amount of ₹ 40 lakhs credited to the bank account of the assessee on 2.2.2012 was, in fact, deposited by the purchaser of the property, Shri Sakthivel. Even before the CIT(Appeals), the assessee did not produce any evidence in support of his contention.
- - 5 ITA 2296/Mds/16 4.2 Further, the CIT(Appeals) observed that the purchaser of the property, Shri Sakthivel in his sworn statement recorded on 18.1.2015 stated that he purchased the above mentioned property situated at No.85B, Natarajapuram South Colony, Thanjavur, measuring two grounds from Shri P. Balasubramanian and he confirmed that he has purchased the aforesaid plot for ₹ 20 lakhs and not paid any amount in excess of ₹ 20 lakhs. Therefore, according to the CIT(Appeals), there is no evidence to prove that the cash deposit was sourced from the purchaser of the property. Further, the CIT(Appeals) observed that the assessee did not make any plea to cross examine the purchaser before the AO and the assessee attempted to mislead the AO by filing an invalid revised return stating that the cash was received from Shri Sakthivel. Therefore, the CIT(Appeals) agreed with the action of the AO in treating the amount of ₹ 40 lakhs as unexplained income u/s.68 of the Act and confirmed the addition. Against this, the assessee is in appeal before us.
The contention of the ld. AR is that the assessee has received a sum of ₹ 60 lakhs for sale of a plot and ₹ 40 lakhs is - - 6 ITA 2296/Mds/16 credited in the bank account, which to be considered as sale consideration in view of prevailing guideline value of the property.
Further, he contended that an opportunity of hearing was not given to the assessee, to explain the same.
On the other hand, ld.D.R submitted that the purchaser of the property confirmed that the assessee has purchased the property only for `20 lakhs and he has not paid any amount in exess of `20 lakhs. Furhter, ld.D.R submitted that the assessee did not make any plea to cross-examine the purchaser before the AO and admitted to mislead the AO while filing the revised return stating that the cash was received from purchaser, viz., Shri Sakthivel. The ld. DR relied on the order of the CIT(Appeals).
I have heard both the parties and perused the material on record. In this case, the main plea of assessee is that the assessee has received money from the sale of property at `16 lakhs, which is equivalent to guideline value of the said property, though it was not disclosed in the original return of income, it was disclosed in revised return dated 26.12.2012, which is within the due date for filing the revised return i.e. 31.03.2013, it is to be - - 7 ITA 2296/Mds/16 considered as a valid return and on the basis of it, the assessment order to be framed. Contrary to this, the AO brought on record that the purchaser has denied paying money in excess of `20 lakhs in a sworn statement recorded from Shri Sakthivel on 08.01.2015. Further, the argument of the ld.A.R is that the AO had not commented anything about his revised return and if it is not explained properly in the revised return, then only the AO can treat it as unexplained income in the hands of assessee. But as seen from the finding s of the Ld.CIT(A), the assessee filed an original return of income for assessment year 2012-13 on 29.08.2012, which is a belated return as due date for filing the same is on or before 31.07.2012 and the revised return was filed on 26.10.2012. In view of the judgement of Supreme Court in the case of Kumar Jagdish Chandra Sinha Vs. CIT ( 86 Taxman 122 SC), the revised return filed by the assessee is invalid return.
Accordingly, this argument of the ld.A.R is rejected.
7.1 Coming to the addition of `40 lakhs, the assessee is not able to prove this is emanated from the sale of property as the purchaser denied of payment of said money to the assessee and - - 8 ITA 2296/Mds/16 the assessee has not been able to show the source of that amount of `40 lakhs. Hence, the addition is sustained. 8. In the result, the appeal is assessee is dismissed. Order pronounced on 21st August,, 2017 at Chennai.