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Income Tax Appellate Tribunal, COCHIN BENCH, COCHIN
Before: Shri Waseem Ahmed & Shri Soundararajan K.
Appellant by: Shri Stephen George, CA Respondent by: Shri Sanjit Kumar Das, CIT-DR Date of Hearing: 30.09.2024 Date of Pronouncement: 21.10.2024 O R D E R Per Bench This appeal filed by the assessee is directed against the order of the Commissioner of Income Tax (International Taxation), Trivandrum dated 16.03.2023 for Assessment Year (AY) 2015-16.
The issue raised by the assessee is that the CIT (International Taxation) erred in confirming the addition made by the Assessing Officer (AO) for Rs. 20,29,699/- u/s 69 of the Income Tax Act, 1961 (the Act).
In the present case, the assessee has made investment in a property, the source of such investment to the tune of Rs.29,29,699/- was not accepted during the assessment proceedings by the AO. As per the assessee, the amount of Rs. 20,29,699/- was directly paid by his wife to the party from Jibu John whom the property was purchased. However, the AO found that there wascash deposits in the bank account of the assessee and therefore the AO was not satisfied with the creditworthiness of the wife of the assessee about the source of investment in the impugned property. Therefore, the AO treated the sum of Rs. 20,29,699/- as unexplained investment u/s 69 of the Act and added the same to the total income of the assessee. Aggrieved assessee carried the matter before the CIT(IT) who confirmed the same by observing as under: - “5. The assessee had during the year purchased an apartment in “Purva Eternity” amounting to Rs. 60,08,932/- from M/s. Puravankara Projects Ltd. The assessee was required to explain the source of his investment. In his reply to notice dated 16/2/2023, the assesse denies having paid 60,08,932/-. He claims that payment of 52,70,785/- plus stamp duty of 3,16,500/- only was paid. In his explanation to the source of this, he states that in addition to the housing loan of 31,00,000/-, his wife has paid amounting to 26,79,699/-. The total of the payments accepted by the assessee comes to 57,79,699/-, This is more than what has stated as the cost of the apartment. The assessee has not factored in payment made for parking space and other amenities. In view of this, value of the apartment is to be taken as 60,08,932/-.
In his explanation to the source of the investment, he has declared housing loan of Rs 31,00,000/- from ICICI Bank. The balance of 29,08,932/- is explained as payment made by his wife Smt Saritha Koshy from her bank account with ICICI bearing account 075101501060 amounting to 26,79,699/-. He has explained the source for 05,50,000/- out of this 26,79,699/- Smt. Saritha Koshy is a resident and her bank account is also a resident account. The assessee in reply to his own case to 148A for AY 2016-17 stated that source for purchase of the same property was met out of his earnings only. Out of the 26,79,699/- payment made, the assessee has no proper evidence to submit other than 1 lakh withdrawn for an amount of 21,29,699/-. However, he has claimed that 7 lakhs were maintained as cash in hand for any medical emergency and that he had brought foreign currency equivalent to 6 lakhs and remaining through sale of gold jewelry.
7. The explanation provided by the assessee has been considered. The claim that 7 lakhs was maintained as cash cannot be accepted as Smt Saritha Koshy also has a bank account and payments can be easily made through the bank for any emergency. The other explanation of foreign currency and gold sale cannot be accepted in the absence of evidence. Thus, an amount of 20,29,699/- is unexplained investment u/s 69 in the hands of the assessee.”
The learned A.R. before us filed a paper book running from pages 1 to 299 and contended that the assessee has discharged the onus by furnishing the justification about the source of investment in the property that his wife has contributed the impugned sum of money in the purchase of the property. As such the assessee had discharged the onus cast u/s 69 of the Act. Therefore, no addition is warranted in the given facts and circumstances.
6. On the other hand, the learned CIT-DR vehemently supported the orders of the authorities below.
We have heard the rival contentions of both the parties and perused the materials available on record. Admittedly, the payment to the tune of Rs. 20,29,699/- was directly made from the bank account of the wife of the assessee. The assessee has discharged the onus by furnishing necessary details. The assessee is not expected to explain the source of fund in the hands of the wife. If at all the Revenue does not believe the source of money in the hands of the wife,the proceedings can be initiated on account of unexplained money in the hands of the wife as per the provisions of law. As such, the assessee cannot be made subject to the addition for the money invested by his wife. Accordingly, we set aside the finding of the learned CIT(A) and direct the AO to delete the addition made by him.
As the assessee on merit of the case, the other grounds raised by the assessee do not require any separate adjudication. Accordingly, we dismiss the same as infructuous.