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Income Tax Appellate Tribunal, BANGALORE BENCH A, BANGALORE
Before: SHRI. SUNIL KUMAR YADAV & SHRI. ABRAHAM P. GEORGE
IN THE INCOME TAX APPELLATE TRIBUNAL BANGALORE BENCH 'A', BANGALORE BEFORE SHRI. SUNIL KUMAR YADAV, JUDICIAL MEMBER AND SHRI. ABRAHAM P. GEORGE, ACCOUNTANT MEMBER (Assessment Year : 2009-10) Income tax Officer, Ward – 4(1), Bangalore .. Appellant v. Shri. Channegowda Madhugowda, No.A-203, 10th C Main Road, Rajaprakruthi Apartment, I Block, Jayanagar, Bengaluru 560 011 .. Respondent PAN : AGIPG2710P Assessee by : None Revenue by : Dr. G. Manoj Kumar, Addl. CIT Heard on : 26.05.2016 Pronounced on : 31.05.2016 O R D E R PER ABRAHAM P. GEORGE, ACCOUNTANT MEMBER :
In this appeal by the Revenue it has taken the following grounds :
1. The CIT(A) erred in granting relief on unexplained cash deposits to the extent of Rs 21,80,000/- merely relying on the changed version of the assessee's submissions regarding ITA.643/Bang/2013 Page - 2
entries in the cash book for an amount of Rs 15 lacs without allowing AO to cross verify the transactions with the concerned parties.
The CIT(A), having considered Rs 9 lacs as commission received and accounted and Rs 15 lacs as received from Mr Vasu, erred in granting relief for the balance amount of Rs 6,80,000/- without any substantiating evidence from the assessee's side.
3. The CIT(A) failed to appreciate that the provisions of sec. 54 envisaged that the capital gains claimed as deduction will be taxed only in the year of expiry of three years period from the date of transfer of original asset only in a situation of depositing the capital gains in the Capital Gains Scheme and not utilizing the same within the said period. The CIT(A) ought to have held that deduction u/s 54 should be denied in this year since the assessee did not deposit the capital gains in Capital Gains Scheme.
2. Ld. DR submitted that assessee has deposited Rs.52,80,000/- in ICICI Bank, but could not submit any source for such deposits. CIT (A) had accepted the claim of the assessee for sum of Rs.8,89,000/- claimed by the assessee as commission received and Rs.15 lakhs claimed by the assessee as advance received for sale of a property from one Shri. Radhakrishna. According to Ld. DR, even if these two amounts were accepted what ought have been sustained by the CIT (A) was not Rs.21,80,000/-, but Rs.28,91,000/-. Further according to the Ld. DR a ITA.643/Bang/2013 Page - 3 claim of the assessee u/s.54 of the Act was allowed by the CIT (A) despite assessee having not deposited the gains in any account under the Capital Gains scheme.
Nobody appeared on behalf of the assessee, despite notice having been served on the assessee through the Department.
4. We have perused the material on record and heard the Ld. DR. Vis- a-vis addition made by the AO for cash deposits of Rs.52,80,000/- in ICICI Bank, source given by the assessee and the evidence furnished were as under :
Rs.in lakhs Evidence Commission income 8.89 Credit in P & L account From Father-in-law as 10.00 No proof wife’s share in agricultural land. Advance for sale of a 05.50 No proof house at Jayanagar Advance for sale of a 15.00 Exchange deed for property, from property Radhakrishna From mother out of her 3.00 No proof savings On sale of property at 4.00 No proof Ramaiah Layout Total 45.89 ITA.643/Bang/2013 Page - 4 Commission of Rs.8.89 lakhs in the above table was shown by the assessee in the return of income. Sum of Rs.15 lakhs was received by the assessee when he exchanged his property with one Shri. Radhakrishna and the same represented the difference in value of property. CIT (A) gave relief for the above amounts since evidence for both the above were produced by the assessee. CIT (A) gave such relief after getting remand report from the AO. Even after considering the above amounts, the difference to be explained by the assessee came to Rs.28.91 lakhs. We are therefore of the opinion that while CIT (A) was justified in giving relief for Rs.23.89 lakhs, he ought have confirmed a sum of Rs.28.91 lakhs and not Rs.22 lakhs. Ordered accordingly. In the result ground 1 of the Revenue is dismissed whereas its ground.2 stands allowed.
3. Vis-a-vis application of Section 54 of the Act, we find that CIT (A) had remitted the matter back to the AO for examination and thereafter to decide whether any amount was to be taxed and to what extent. We do not find any reason to interfere with the order of CIT (A) in this regard. Ground.3 stands dismissed.
ITA.643/Bang/2013 Page - 5
In the result, appeal of the Revenue is partly allowed.