SHRI DEERAJ SINGH,NEW DELHI vs. ITO, FARIDABAD

ORDER PER O.P. KANT, A.M.: The present appeal by the assessee is directed against the order of Commissioner of Income Tax(Appeals), Faridabad, dated 19.09.2014 for the assessment year 2009-10 raising following grounds of appeal:

2. That at any rate, the additions aggregating at Rs. 6,24,000/- as made by the learned Assessing Officer ot the income of the appellant and confirmed by the learned Commissioner of Income Tax(Appeals) is arbitrary, unjust, illegal inasmuch as the appellant had field proper explanation explaining the source thereof support by documentary evidence. .Del.2015 Sh. Dheeraj Singh

3. The deposit of Rs. 1,50,000/- in the Bank A/c on 24.05.2008 also represented advance against sale of agricultural land and it was through oversight wrongly mentioned that such amount had been received from the parties on 25.05.2008 which was merely a clerical error in the Agreement to Sell.

4. Various observations made by the authorities below in their respective orders are either incorrect or legally untenable.

5. That without prejudice to above grounds, the additions of Rs. 6,00,000/- and Rs. 24,000/- towards the assessable income of the Appellant are very excessive.

6. That the Appellant reserves high right to add, amend/modify the grounds of appeal.

2. The facts in brief, as culled out from the order of the lower authorities, are that the assessee is an individual. He filed return of income on 18.09.2009 for the assessment year under consideration declaring total income of Rs. 2,10,000/- in addition to agricultural income of Rs. 88,600/-. The assessee was engaged in carrying out the services relating to real estate in the name of proprietary concern, M/s Singh Associates. The case of the assessee was selected for scrutiny under Computerized Assisted Selection of Scrutiny (CASS) and a notice under Section 143(2) of the Income-tax Act, 1961 (for short “the Act”) was issued. In the course of scrutiny proceedings, the assessee was asked to explain the source of total deposit of Rs. 14,01,500/- made on various dates in the saving bank account maintained by the assessee with the ICICI bank. The assessee explained that Rs. 6,00,000/- was received as advance against sale of agricultural land, Rs. 2,75,000/- was deposited out of cash withdrawn from the proprietary concern and the balance cash deposited was withdrawn from bank on various earlier dates and redeposited subsequently . The justification of advance 3 ITA no. 5510.Del.2015 Sh. Dheeraj Singh received against agricultural land was not accepted by Assessing Officer due to following reasons: i. The assessee could not produce the person for examination to ascertain creditworthiness and genuineness of the transaction and explain the source of cash deposit. ii. The land was jointly owned by the two brothers where there was no deposit in the accounts of brothers. iii. There was an inconsistency in the date of cash deposit mentioned in the agreement and the cash deposited in the bank account.

2.1 Under these circumstances the deposits of Rs. 6,00,000/- were held as as unexplained under Section 68 of the Act by the Assessing officer. Aggrieved with the order of the Assessing Officer, the assessee filed an appeal before the learned Commissioner of Income Tax(A). Before him, the assessee pleaded that there was a clerical mistake in the agreement to sale. The learned Commissioner of Income Tax(Appeals) has observed that the assessee failed to substantiate his claim by filing any evidence. Further, the Commissioner of Income Tax(Appeals) has observed that after lapse of six years from the agreement to sale, the deal was executed and no registration for the land in question has taken place. Further, he observed that though the land was jointly owned by two brothers, however, there was no deposit of the equivalent amount in the bank account of the brothers. In view of the observations, the learned Commissioner of Income Tax(Appeals) sustained the order of the Assessing Officer. Aggrieved, the assessee is before us with the present appeal. .Del.2015 Sh. Dheeraj Singh 3. At the time hearing, the assessee filed an application under Rule 29 of the ITAT Rules seeking permission for filing a certificate dated 14.11.2015 from Sh. Devendra Singh, son of Sh. Karan Singh, for admission as additional evidence. The facts in this regard are that the assessee explained the source of cash deposited in bank account as advance received from Sh Devendra Singh against agreement to sale of land. In scrutiny proceedings, the assessee submitted a copy of said agreement to sale containing various dates on which, he received advance money in cash from Sh. Devendra Singh. However, the Assessing observed that on one occasion, cash of Rs. 1,50,000/- was deposited in bank on 24.05.2008 , whereas as per agreement said cash was received on 25.05.2008. The assessee failed to explain this inconsistency and adduce any evidences in that regard during scrutiny proceedings as well as before the first appellate authority. Now, before us the assessee has submitted a certificate from sh Devendra Singh clarifying said inconsistency. In the certificate, Sh Devendra Singh has averted that the said cash of Rs. 1,50,000 was actually given on 24.05.2008 , however, by inadvertent mistake , the date was recorded as 25.05.2008 in the agreement. The learned Authorized Representative of the assessee requested to admit the said certificate as additional evidence as the certificate could only obtained from Sh. Derandra Singh after lot of efforts and persuasion and therefore, he could not produce the certificate before lower authorities. The learned Departmental Representative, on the other hand, objected for the admission of additional evidence, on the ground that sufficient .Del.2015 Sh. Dheeraj Singh opportunity was already provided to the assessee, both by the Assessing Officer and CIT(A). 3.1 We have heard the rival submissions. We are of the opinion that said certificate has been obtained by the assessee subsequent to proceedings before the first appellate proceeding and that too after lot of efforts and persuasion and therefore the assessee could not produce said evidence before the lower authorities. In similar situations in the case of CIT v/s Text Hundred India (P) Ltd. Reported in 351 ITR 57, Hon’ble High Court of Delhi held that once it is found that party intending to lead evidence before the Tribunal for the first time was prevented by sufficient cause to lead such an evidence and that evidence would have material bearing on the issue which needs to be decided by the Tribunal and ends of justice demand admission of such an evidence, the Tribunal can pass an order to that effect. Therefore, in the interest of natural justice , we admit said certificate filed by the assessee under Rule 29 of the ITAT Rules.