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Income Tax Appellate Tribunal, CHANDIGARH
Before: SHRI VIKRAM SINGH YADAVANDSHRI PARESH M. JOSHI,
आयकर अपीलीय अिधकरण,च"डीगढ़ "यायपीठ,च"डीगढ़ IN THE INCOME TAX APPELLATE TRIBUNAL, CHANDIGARH BENCH‘B’ CHANDIGARH BEFORE: SHRI VIKRAM SINGH YADAV, ACCOUNTANT MEMBER ANDSHRI PARESH M. JOSHI, JUDICIAL MEMBER, आयकर अपील सं./ITA No. 532/CHD/2023 िनधा"रण वष" /Assessment Year : 2012-13 बनाम Smt. Deepinder Kaur Johal, The ITO, 41, Phase 2, Ward – 4, VS New Officers Enclave, Patiala. Patiala. "थायीलेखासं./PAN /TAN No:AGBPJ1466G अपीलाथ"/Appellant ""यथ"/Respondent िनधा"रती क" ओर से/Assessee by : Shri Tej Mohan Singh. Advocate राज"व क" ओर से/Revenue by : Shri ManpreetDuggal, JCIT, Sr.DR तारीख/Date of Hearing : 27.06.2024 उदघोषणा क" तारीख/Date of Pronouncement : 30/08/2024 PHYSICAL HEARING आदेश/ORDER
PER PARESH M. JOSHI, JM
This is an appeal filed by the assessee Smt. Deepinder Kaur Johal under Section 253 of the Income Tax Act, 1961 being aggrieved by the order of CIT(A) bearing No. ITBA/NFAC/S/250/2023-24/1053805312(1) dated 20.06.2023 in respect of assessment year 2012-13 u/s 250 of the Income Tax Act, 1961 which is hereinafter referred to as the “impugned order”.
Factual Matrix
The assessee is an individual.
The case of the assessee was reopened u/s 147 of the Income Tax Act for the F.Y. 2011-12 corresponding to assessment year 2012-13.
On basis of certain information available on records and as received from the ITO Ward-3(2) Ferozepur who had reported that in the course of the ITA 532/CHD/2023 A.Y. 2012-13 2 assessment proceedings for assessment year 2010-11, he had found that his assessee Shri Narinder Singh S/o Shri Gurdas Singh along with Shri Deepinder Kaur Johal and Shri Harpreet Singh made an Agreement with Shri Bhalinder Singh Gill for purchase of 14 Acres, 5 Kanal land and had made advance payment of Rs.2.60 Crores during Financial Year 2010-11, relevant to assessment year 2011-12 and Rs.2.20 Crore during Financial Year 2011-12 relevant to assessment year 2012-13. 5. The share allocation of the purchasers were ; i) Shri Narinder Singh having 1/5th share ii) Smt. Deepinder Kaur having 2/5th share iii) Shri Harpreet Singh having 2/5th share Note : Rate as per both Agreement of Sale dated 01.07.2010 and 16.11.2011 was Rs.1.80 Cr per Acre which works out to Rs.26.10 Cr.
The assessee Smt. Deepinder Kaur had 2/5th share being Rs.2,20,00,000/- in aforesaid purchase deal as per the “Ikrarnama” alongwith Shri Narinder Singh and Shri Harpreet Singh for their share 1/5th and 2/5th share had paid Rs.1,50,00,000/- and Rs.4,00,00,000/- on 15.11.2021 in Financial Year 2011-12 relevant to assessment year 2012-13, a Notice u/s 142(1) was issued on 30.07.2018 to the assessee calling for information in this regard. The assessee, however, did not respond. After some non compliances by the assessee; another notice was, accordingly, issued u/s 142(1) on 11.10.2018 to explain the source of investment for purchase of the property mentioned above for Rs.2,20,00,000/- by the assessee for her share as per ‘Ikrarnama’. Since there was no explanation received from the assessee, the case of the assessee was reopened u/s 147 of the Act for assessment year 2012-13 and notice u/s 148 of the Act was issued. Be it noted that there are two Ikrarnamas on record one dt. 01/07/2010 and another dt. 16/11/2011. ITA 532/CHD/2023 A.Y. 2012-13 3 7. The assessee submitted that the return of income had already been submitted on 15/09/2012 declaring total income of Rs.3,94,800/-. Thereafter, notice u/s. 143(2)had been issued. Further notice u/s. 142(1) had been issued on 11/12/2018 asking to explain the source of the investment in the impugned property as above. The Assessing Officer after elaborating the facts in para 4 of the assessment order and further the share of investment of the assessee of Rs.2,20,00,000/-for such purchase deal given as advance asked the assessee to furnish the explanation about the source along with evidence for such investment. The assessee vide her reply given on 04/12/2018 stated that no such transaction had been done by her and the amount had been paid by other parties mentioned in the Ikrarnama’s and she had no connection with the amount mentioned against her name in the said Ikrarnama’s. The assessee thereafter had furnished a reply on 25/12/2018 along with a copy of Affidavit given by Shri Narinder Singh before the Court and a copy of Judgement passed by the Hon'ble Distt. Judge, Barnala dated 14/08/2015 submitting that Rs. 60,00,000/-had been paid by her in cash from the sale of family Agricultural land amounting to Rs.55,00,000/-and from her personal savings of Rs. 5,00,000/-. The assessee also had furnished a copy of Sale Deed regarding the sale of land at Rs. 55,00,000/-and a copy of Halfia Bian of her sister Smt Ranjit Kaur wherein she had depicted that she including her brother and the sister had paid the said amount to the assessee Smt. Deepinder Kaur. The assessee, however, had admitted, that she was one of the co-purchasers having her 2/5th share in the said property and had paid Rs.60,00,000/- in cash to the sellers through Shri Narinder Singh.
The AO after perusal of the Court’s order dated14/08/2015 as furnished by the assessee during assessment proceedings found that the purchasers Shri Narinder Singh, Smt. Deepinder Kaur being assessee and Shri Harpreet Singh had paid an amount of Rs.4,68,00,000/-to the sellers and an amount of Rs.2,60,00,000/-had been paid in F.Y.2010-11 relevant to A.Y.2011-12 and balance amount of Rs.2,08,00,000/-had been paid in the F.Y. 2011-12 relevant ITA 532/CHD/2023 A.Y. 2012-13 4 to A.Y. 2012-13. The assessee's share being 2/5th on such payment of Rs.2,08,00,000/-, the same was calculated at Rs.83,20,000/- having been paid in A.Y.2012-13 by the assessee. The A.O. contended that the assessee had admitted before the Court and also in the subsequent submission that she had paid Rs.60,00,000/- in cash from the sources as stated above and therefore no source in respect of the balance amount paid of Rs.23,20,000/- had been explained excepting the denial made that no such amount had been paid. Since the Ikrarnama had mentioned the assessee's share as 2/5th and further, her payment was determined at Rs.2,20,00,000/-for both A.Ys. 2011-12 and 2012-13 and the payment made in A.Y.2012-13 for her share as per Ikrarnama of Rs.83,20,000/- and further no explanation in regard to such entire payment relating to its source could be furnished before the A.O. excepting the amount of Rs.60,00,000/- as mentioned above, the A.O. made the addition of the difference amount of Rs.23,20,000/- (i.e.83,20,000/- minus Rs.60,00,000/-) as assessee's unexplained investment from undisclosed source in the assessment order.
Aggrieved by the order of the AO, the assessee has contested the additions before the appellate authority thereby raising the grounds as detailed below- "1.Ld. A.O. erred in law and on facts in assuming jurisdiction u/s 147/148. 2. Ld. A.O. erred in law and on facts in making addition of Rs.2320000/- as unexplained investment on conjectures and surmises. 3. The Id. A.O. gravely erred in charging interest under section 234A, 234B and 2340. The Id. A.O. gravely erred in charging interest under section 234A, 234B and 234C.
On issue of notice u/s 147/148 of the Income Tax Act 1961, the ld. CIT(A) has held as follows :
4.1. The facts of the case have been stated in detail above. However, the same are discussed briefly. The case of the assessee for the A.Y. 2011-12 had been reopened u/s. 147 of the IT. Act 1961 for the reason that during the course of assessment proceedings in the case of another assessee Shri Narinder Singh, the said assessing officer had noticed that his assessee along with the other two co-purchasers which included the assessee Smt. Deep Inder Kaur had made an ' Ikrarnama withthe seller of the land in which the assessee's share was 2/5th and ITA 532/CHD/2023 A.Y. 2012-13 5 she was supposed to pay the purchase consideration of Rs. 2,20,00,000/- to the buyer Shri Balinder Singh Gill along with other purchasers for the purchase of land admeasuring 14 acre 5 kanal during F.Y. 2010-11 relevant to A.Y. 2011-12. For making necessary verification in this regard before initiating proceedings u/s. 147/148 of the Act, the Assessing Officer in the case of the present assessee had issued verification notices to the assessee seeking detailed information/particulars in this regard. The A.R. of the assessee Sri Rajesh Gupta though appeared before the AO on 27.09.2018, 10.10.2018 and 26.11.2018 alone and thereafter with the assessee further on 27.11.2018, no details/information in regard to the payment mentioned about assessee's 2/5th share in the 'Ikrarnama' forwhich explanation was sought by the AO. from time to time had been furnished by the assessee. Accordingly, the proceedings u/s. 147/148 of the Act had been initiated and notice u/s. 148 was issued to the assessee. Subsequent to such issue of notice, the assessee appeared before the AO and bluntly denied of any such deal in land and/or any such nexus with the transactions for the impugned purchase of land. The case was developed into inquiry and it was found by the A.O. that there was a case pending before the district judge, Burnala which was decided by the Hon'ble judge on 14.08.2015 wherein before the Hon'ble judge the assessee admitted of giving an amount of Rs. 1600,000/- for the purchase consideration as advance to the impugned transaction of the land as stated above. Regarding the source of giving such amount of Rs. 60,00,000/-, it was explained before the court by the assessee that she had sold an agricultural land for a consideration of Rs. 55,00,000/- from which along with an amount of Rs.5,00,000/- from her personal savings gathered from her sister and also herself, totalling to Rs. 60,00,000/- had been given for the purchase of the land. Therefore, before the Hon'ble district court based on which an order was passed by the judge admittedly for such transaction of the land in which initially the assessee had denied of having any nexus, had paid an amount of Rs. 60,00,000/-. This fact clearly revealed to the AO and also established that the 'Ikrarnama'which was made by and between Shri Balinder Singh Gill, the sailer of the land and three co-purchasers in which the assessee was one of them had came into an Agreement and accordingly the assessee was supposed to pay for her share in land proposed to be purchased of an amount of Rs. 2,20,00,000/- during F.Ys. 2010-11 and 2011-12 relevant to A.Ys. 2011-12 and 2012-13. It was found that as per the said'Ikrarnama' dated 01.07.2010 and subsequent development, the assessee was required to pay Rs. 83,20,000/- during the F.Y. 2011-12 relevant to A.Y. 2012-13 which was 2/5th share of Rs. 2,08,00,000/-. Since the assessee could explain the source of the payment of purchase consideration of the impugned land as detailed above of Rs. 60,00,000/- only, the A.O. had added the difference amount of Rs. 23,20,000/- to the total income as assessee's unexplained investment from undisclosed source of income.
The ld. CIT(A) in respect of ground No.1 has held as under :
4.3 I have perused the assessment order and the submission of the appellant as quoted above carefully. From the facts as stated in para 5.1 above, it can clearly be seen that the assessee initially had totally denied of being involved in any such land transactions. When explanation was sought by the A.O. from the assessee's A.R. who had appeared before him on four to five occasions, he could not throw any light of furnish any ifs and buts in regard to such land transactions. Even when the A.R. appeared with the assessee before the A.O., the assessee had denied of having any nexus with such land deal. This being the fact, the very fact that the 'Ikrarnama’ had been confirmed before the district ITA 532/CHD/2023 A.Y. 2012-13 6 court and further for the identical land deal the assessee had admitted that she had paid an amount of Rs. 60,00,000/- during the F.Y. 2011 -12 relevant to A.Y. 2012-13, the fact which had been all through denied by the assessee appellant had been found to be true on the basis of the said 'Ikrarnama' dated 01.07.2010. Therefore, when the notice u/s. 148 had been issued by initiating proceedings u/s. 147 of the Act in the case of the assessee, it was the mandatory obligation of the assessee to file the return of income disclosing the facts relating to such land transactions. The assessee had not done so. On the other hand, in pursuance to the notice u/s. 148 of the Act a return filed on 15.09.2012 had been refer to in which income had been declared at Rs. 3,94,800/-. Accordingly, the proceedings u/s. 147/148 of the Act had to be initiated by the A.O., which had rightly been initiated. The resultant effect was completion of the assessment after due enquiries which had also been done by the A.O. after issuing notices u/s. 143(2) and 142(1) of the Act from time to time. I do not find any fault with the said reopening proceedings initiated for taxing the income which had escaped assessment owing to such impugned land transactions. I also find that the notice u/s. 148 of the Act had rightly been issued for taxing such concealed income in the case of the appellant.
11.1 The ld. CIT(A) after taking into consideration case law cited by the assessee has finally held as under in respect of Ground No. 1 :
4.3.1 The appellant has cited certain decisions containing that in such decisions it was held that the proceedings u/s. 147 had not been initiated legally and after referring to such decisions it was contended that in the case of the assessee appellant under consideration also the proceedings have been wrongly initiated as there were no facts which led to detect any escapement of income in the case of the assessee. I find that the facts in the various cases referred to by the appellant are completely different than the facts of the case of the appellant as in appellant's case under consideration there was a constant denial and such consistency of denial and negating of any such land deal very well proved that there was a mala-fide intention of the appellant not to disclose the true and correct facts relating to land deal or in the other hand the appellant deliberately had made the efforts to conceal the facts, relating the impugned land transactions on the basis of the Ikrarnama'dated 01.07.2010 which she had to admit before the Hon'ble District Court, Bernala and only thereafter it could be established by the A.O. that there was the impugned land transactions in which the appellant made substantial payment on the basis of the said Ikrarnama' and finally the very denial of having any nexus with such land deal by the appellant proved to be futile and untrue. Therefore, the cases cited by the appellant in the submission are not applicable at all with the case of the appellant under consideration. Hence, no interference in AO's order in this regard is called for. Ground No. 1 raised by the appellant is accordingly dismissed.
The ld. CIT(A) in respect of Ground No.2 has held as under:
5.2 I have perused the assessment order and the submission of the appellant as above carefully. For the identical reasons as discussed above while deciding ground No. 1 wherein the facts relating to the Ikrarnama' executed dated 01.07.2010by the appellant along with other two co-purchasers and ITA 532/CHD/2023 A.Y. 2012-13 7 the seller of the land Sri. Balinder Singh Gill have been discussed in detail along with the denial Initially of the appellant of conducting any such deal and subsequently admission before the Hon'ble District Court of executing such land deal for which the appellant during the year had paid from sale of agricultural land of Rs. 55,00,000/- and further Rs. 5,00,000/- from personal savings, I am of the considered opinion that the appellant had to pay the further amount of Rs. 23,20,000/- being her 2/5th share in Rs. 2,08,00,000/- which came to Rs. 83,20,000/- and accordingly the A.O. had rightly taxed the differenceamount of Rs. 23,20,000/- which the appellant had denied to have been paid for such land deal. It is further pertaining to mention that in such real estate transactions, there is always a under hand deal and it is an open secret that substantial cash payments are made which are not recorded in the purchase/sale deed. Since the Ikrarnama' was found in the case of one of the co-purchasers Shri Narinder Singh by his assessing officer wherein the name of the Appellant assessee was also found of the purchaser of the land of her 2/5th share and accordingly during this relevant Assessment Year all three co-purchasers had paid for such land deal of Rs. 2,08,00,000/- in which assessee's share was Rs. 83,20,000/- being 2/5th share, the assessee could not deny of not making such payment as purchase consideration when the amount of Rs. 60,00,000/- had been admitted to have been paid for the identical land transactions on the basis of the said Ikrarnama'. The various submission made by the appellant as quoted above and arguments advanced, in my opinion, are irrelevant when the very nexus in the land deal had been established with supporting documentary evidences and subsequent admission of the appellant. I accordingly, reiterate my contention that the AO had rightly treated the amount of Rs. 23,20,000/- being the difference amount added by him as unexplained investment in the land for the detailed reasons given by him in the assessment order. The appellant had relied on certain decisions in the submissions made as quoted above. For the facts as stated above in the case of the appellant, I find that the facts of the said decisions cited by the appellant are not applicable to the facts of the case of the appellant. I therefore do not find any reason to interfere with the observations and findings of the Assessing Officer and so also his decision in regard to such addition made. The addition so made of Rs. 23,20,000/- is therefore confirmed.Ground No. 2 raised by the appellant is accordingly dismissed.
The ld. CIT(A) in respect of Ground No. 2 has held as follows:
6. In ground no. 3, the appellant has contested charging of interest u/s. 234A, 234B, 234C &.234D. Charging of interest under sections 234A, 234B, 234C and 234D are consequential in nature and mandatory as has been held by the Hon'ble Supreme Court in the case of Anjum M.H. Ghaswala reported in 252 ITR 01. Following this decision, in the case of Motorola Inc. a/s. DCIT (2005) 96 TTJ (Del) (SB) 1, the ITAT, Delhi Special Bench has held that levying of interest u/s 234A, 234B and 234C is mandatory in the sense that it cannot be waived or reduced by the IT. authorities. Hence, I hold that neither there was any discretion with the Assessing Officer on the issue of charging of the interest under sections 234A, 234B, 234C and 234D nor the appellant can have any grievance in this regard. Accordingly, ground of appeal
no. 3 is dismissed
14. The ld. CIT(A) by impugned order has sustained the order of ld. AO dated27.12.2018. ITA 532/CHD/2023 A.Y. 2012-13 8
15. The assessee before this Tribunal has raised following grounds of appeal in Form 36 which are as under :
“1. That the Ld. Assessing Officer has erred in law in reopening the assessment by issuance of notice u/s 148 of the Act in as much as there has been no escapement of income and as such the order passed is illegal, arbitrary and unjustified.
2. That the Ld. Assessing Officer has erred in law as well as on facts in as much as there has been no reason to believe that there was an escapement of income in as much as the reasons recorded are based only on borrowed information, incorrect facts, conjectures and estimation and as such the assessment order passed is illegal, arbitrary and unjustified.
3. Without prejudice to the above, the Ld. Commissioner of Income Tax (Appeals) has erred in law as well as on facts in upholding the addition of Rs.23,20,000 /- made on account of alleged unexplained investment in land which is arbitrary and illegal.
4. That the appellant craves leave to add or amend the grounds of appeal
before the appeal is finally heard or disposed off.
5. That the order of the Ld. CIT(A) is erroneous, arbitrary, opposed to the facts of the case and thus untenable. Record of Hearing
During the course of hearing held on 27.06.2024, both the parties were heard on merits of the case at length. The ld. AR contended that Department ought not to have invoked the provision of Section 147 and 148 of the Act and very exercise of such power is bad in law and illegal. The ld. AR after briefly recited the above facts (supra) placed reliance on orders of few High Courts and that of ITAT through compilation of judgements which were placed on record but were not recited across Bar including copy of decision in case of ITO Vs M/s Champaklal Mathurbhai Mehta dated 25.11.2022. The broad proposition of law which was canvassed before us at the outset and threshold of the hearing was that the Assessing Officer has grossly erred in law in as much as there has been no reason to believe that there was an escapement of income in as much as reasons recorded are based only on borrowed information, incorrect facts, conjectures and estimation. The re-opening of the assessment by issuance of notice is bad in law as no income has escaped. Order is illegal, arbitrary and unjustified. Moving forward the ld. AR contended that addition of ITA 532/CHD/2023 A.Y. 2012-13 9 Rs.23,20,000/- made on account of alleged unexplained investment in land is arbitrary and illegal.
16.1 According to him the facts of the matter is that the original buyer of the land was one Shri Narinder Singh who had entered into an Agreement to Sell dated 01.07.2010 with a seller in which he was a sole buyer. Shri Narinder Singh as per said agreement made payment to the seller as follows :
1) Rs.10 lakh on 01.07.2010 2) Rs. 2.5 Cr on 31.12.2010 and 3) Rs. 1.5 Cr on 15.05.2011. Shri Narinder Singh has testified the aforesaid facts in sworn Affidavitdt. 06/3/2017 before Addl. Civil Judge (Sr. Division) Barnala. He has placed reliance on copy of judgement dated 14.08.2015 of District Judge, Barnala which is annexed to Paper Book. The ld. AR then contended that as per agreed payment-plan, Shri Narinder Singh was to pay further Rs.4 Cr to the buyer on 15.11.2011. However, due to financial constraints Shri Narinder Singh with the consent of the seller brought into picture Shri Harpreet Singh and Smt. Deepinder Kaur [the assessee herein] as co-buyers and gave them 2/5th share each of the land transaction to be made.
16.2 Accordingly, a fresh Agreement of Sell was entered by all the co- buyers with seller which is dated 16.11.2011 incorporating the conditions and payments made as per original Agreement to Sell dated 01.07.2010 and it was agreed between the co-buyers that further payments in relation to balance consideration will be made by the co-buyer in their respective shares as stated in new Agreement to Sell.
16.3 It was emphasized that the original buyer i.e. Narinder Singh made payments upto 15.05.2011 on his own as per Agreement dated 01.07.2010. The assessee was made party to contract only vide Agreement entered ITA 532/CHD/2023 A.Y. 2012-13 10 dated 16.11.2011 and all payments made before the date of new agreement were made by Shri Narinder Singh.
16.4 Further AR submitted that as per new Agreement dated 16.11.2011 the co-buyers were to make payment of Rs.4 Cr in the following ratio : i) Shri Narinder Singh (1/5th share) Rs.80,00,000/- ( as testified in Court) ii) Smt. Deep Inder Kaur (2/5th share) Rs. .1,60,00,000/-, the assessee herein. iii) Shri Harpreet Singh (2/5th share) Rs.1,60,00,000/-/ 16.5 The ld. AR then contended that the assessee paid her share of Rs.1,60,00,000/- as per details below :
Cash Rs. 60,00,000/- Cheque Cheque No. 015944, ICICI Bank, Patiala Rs. 1 Cr It was submitted that the cheque of Rs.1 Cr could not be honoured verifiable from Court order. 16.6 Ld. AR then contended that the assessee has made net investment of Rs.60,00,000/- in the year under consideration i.e., assessment year 2012-13, corresponding to Financial Year 01.04.2012 to 31.03.2013. No other payment, whatsoever was made. The land transaction went into dispute and the matter is subjudice in Court of Addl. Civil Judge, Sr. Division, Barnala.
16.7 Source of Rs.60,00,000/- i) Rs.55,00,000 – From sale of family agriculture land (sale deed relied upon not in Paper Book) (No capital gain accrued). ii) Rs.5,00,000/- - Personal Family savings Finally he contended source is explained. 16.8 The ld. AR also took us through the Court order of ld. District Judge, Barnala, in MCA No.64 of 08.11.2013, Regd. No. MCA/134/2013 decided on 14.08.2015 titled Bhalinder Singh Vs Narinder Singh (Annexed to Paper Book).
ITA 532/CHD/2023 A.Y. 2012-13 11 17. Per contra ld. DR has gone by the order of AO and CIT(A) during the course of the hearing wherein all issues have been examined including one under Section 147/148 and well reasoned orders are on record according to law. No interference is called. Findings and Conclusions
We now have to examine the legality, validity and proprietary of the impugned order.
18.1 We observe that in the assessment proceedings, the ld. AO has observed and held that the assessee is having 2/5th share in the investment as co-purchaser. The assessee's 2/5th share of Rs.2,08,00,000/- comes to Rs.83,20,000/- as per District Court order dt. 14/08/2015. The assessee admittedly paid Rs.60,00,000/- in cash from sources [sale of family land and personal/family saving]. The balance amount of assessee comes to Rs.23,20,000/-. The assessee has not explained any source of this amount but only relied on the plea that this amount has not been paid by her. The ld. AO has held her to be co-owner of the land to the extent of 2/5th share and that Ikrarnama and Court orders are proof enough and consequently source of Rs.23,20,000/- [ 83,20,000 – 60,00,000] is unexplained investment. The reply submitted by the assesse was not accepted. Assessee has put her signature on the Ikrarnamadt. 16/11/2011. The onus is not discharged by the assesse. Denial simplicitor about non payment is not accepted. The Ld. CIT(A) has sustained the Ld. AO’s order.
18.2 After perusing Agreement to Sell of land situated at Patti Shekhawa dated 01.07.2010 page 20 to 22 of Paper Book, we notice that one Bhalinder Singh Gill holder of Power of Attorney on behalf of the few others including selfare owners of about 14 ½ acre of land which is described in details in said Agreement situated at Patti Shekhawa[ Two palaces AartiGarden and Sood Resort are running] Distt. Barnala, Punjab agreed to sell the said land to one Shri Narinder Singh @ 1.8 Cr per acre( 8kanal). The amount of Rs. 10.00 lakhs ITA 532/CHD/2023 A.Y. 2012-13 12 has been shown as earnest money.. It is stated therein that buyer shall pay Rs. 2.5 Cr on 31.12.2010, 1.5 Cr on 15.05.2011 and on 15.11.2011 Rs. 4Crores and after paying the remaining amount on 15.11.2012 Sale Deed would be executed. The Agreement to Sell is having witness. It is signed by Seller and Buyer. In this Agreement, name of assessee is not appearing.
18.3 After perusing Agreement to Sell of land situated at Patti Shekhwa dated 16.11.2011 which is in respect of aforesaid land we notice that on page 28 of Paper Book, following words “Earlier an agreement of this land was entered into on 01.07.2010 with solely in favour of Narinder Singh. Now as per saying of purchaser this Agreement is got written in favour of three persons”. Out of three persons names of Narinder Singh, Harpreet Singh and Deepinder Kaur Johal (the assessee) are now appearing. This shows Harpreet Singh and Deepinder Kaur Johal (the assessee) were newly introduced in this land deal transaction.
18.4 We notice in the document dated 16.11.2011 shares of each person is described against total holding of the land, in question.
18.5 We have also minutely perused the order of District Judge, Barnala wherein following is recorded in para 10 :
“Then on 16.11.2011 another agreement was executed between the parties whereupon the plaintiff and Deepinder Kaur Johal and Harpreet Singh paid an amount of Rs.3 Crores to Defendant Baljinder Singh as additional earnest money…….” In para 13, it is further recorded as ; “The instant suit has been filed only by the plaintiff qua his share only and has not been field by other persons in whose favour the Agreement to Sell dated 16.11.2011 was executed.” 18.6 On totality of facts taken together we hold that issue pertaining to land is subjudice. We do not know who would finally own how much share of land holding in dispute upon full payment which comes to Rs.26.10 Crores. Whether full payment is made or not, we do not know as nothing was ITA 532/CHD/2023 A.Y. 2012-13 13 clarified in the hearing. Further Agreement of Sell dated 01.07.2010 was between Seller Shri Bhalinder Singh and others as seller’s and Narinder Singh as buyer. Thereafter there is another Agreement dated 16.11.2011 which is between aforesaid Seller’s and total three person including the assessee.
18.7 We hold that we do not intend to venture further and dwell over land in question. We are concerned with income and its sources, in respect of year under consideration.
18.8 We hold that it has come on record that the assessee is co- owner/purchaser of land in question alongwith two others. In proceeding under the Income Tax Act only, an amount of Rs.60,00,000/- has emerged as undisclosed income/unexplained investment, whose source is adequately explained, in respect of year under consideration, while computation of income was being done.
Considering the above, we hold that deeper enquiry is required to be made as on page 26 of Paper Book i.e., Agreement to Sell dated 16.11.2011 we also notice that on 14 ½ acre of land two palaces Aarti Garden and Sood Resort are running. The total value of land is 26.10 Cr. The deal is not yet finalized as it appears. Matter is subjudice. Whether whole consideration amount is paid or not is not known to us. Who would pay it in future and how and the manner of payment is not known to us. In brief nothing is finally settled with regard to land in question.
20.1 Be it noted that we are dealing with the issue of income under the Income Tax Act, 1961 and its sources. We are not having any jurisdiction in law to see who gets what share in the land holding. Who has made claim of 1/5th share and why no claim is not made by the assessee of her 2/5th share. However, the Agreement to Sell dated 16.11.2011 when analysed from the point of view of payments made to Seller by the assessee alone is required to be seen. Keeping this appeal in our mind, we are of the considered opinion that District Court order dated 14.08.2015 supra, Agreement to Sell dated ITA 532/CHD/2023 A.Y. 2012-13 14 16.11.2011are only useful guide / tools to determine the character of assessee's income. Basis this, we see and observe that ld. District Judge order wherein it has been averred as follows :-
10…..Then on 16.11.2011 another agreement was executed between the parties whereupon the plaintiff and Deepinder Kaur and Harpreet Singh paid an amount of Rs.03 Cr to the defendant Bhalinder Singh as additional earnest money and gave a cheque bearing No.015944 drawn on ICICI Bank Ltd. and assured Bhalinder Singh defendant that they would make payment of Rs.01 Crore within a week and would get back the said cheque. But they failed to make the payment of Rs. 01 Crore.
In an affidavit before Court of Additional Civil Judge (SD) Barnala dt. 06/03/2017 Shri Narinder Singh, co-buyer(1/5th share) annexed on page 45 to 55 of Paper Book which is dated 06.03.2017 on page 47, 48, 49 it is averred as under :
“ 7…. …..on 16/11/2011 the deponent Deepinder Kaur Johal and Harpreet Singh made the payment of Rs. 4,00,00,000/- as per their shares to the defendant No. 1 and the stipulated date for the purpose of execution and registration of the sale deed was fixed to be 15-11-2012. It is pertinent to submit here that the original agreement of sale dated 01/07/2010 was taken back by the defendant No. 1 from the deponent but the photocopy of the agreement of sale dated 01/07/2010 was given to the deponent by the defendant No. 1.” “8. That 1/5th share out of the total land measuring 14 ½ acres of the deponent comes to be land measuring 23 Kanals 4 Marlas which was agreed to be purchased by the deponent from the defendant No.1 and the total sale consideration comes to be Rs.5,22,00,000/- and the defendant No.1 has already received Rs.4,68,00,000/- from the deponent i.e., Rs.10,00,000/- on 01.07.2010, Rs.2,50,00,000/- on 30.12.2010, Rs.1,28,00,000/- on 17.05.2011 and Rs.80,00 000/- on 16.11.2011 i.e., 1/5thshare of the deponent of the amount of Rs.4,00,00,000/- (4 crores)”. “11. That since the execution of the agreement of sell dated 01.07.2010 the deponent had always been ready and willing to perform his part of the agreement.” “12. That on 15.11.2012 the deponent alongwith the balance sale consideration and other expenses for the purpose of execution and registration of the sale deed remained present in the office of Tehsildar Cum Sub