2016 (10) TMI 1141 - AT - Income Tax

Addition u/s 69B - unexplained purchase of land - Held that - It is an admitted fact that the assessee has purchased M/s PSP Steels(P) Ltd for a sum of 22 crores and 19 crores was paid through banking channel which was not disputed by the Department. The details of the payments made were furnished by the assessee before the CIT(A) as well as before us in the statement of affairs. This fact was not disputed by the Department. The remaining amount of 3 crores was paid by the assessee from his own source for which fact finding was given by the CIT(A). During the appeal the ld. AR furnished the date wise payment in the paper book and the same was not controverted by the ld. DR. Therefore we do not find any reason to interfere with the order of the CIT(A) and the same is confirmed.

Summary

Issues:
Deletion of addition of ? 7.02 crores made under section 69B of the Income-tax Act, 1961.

Analysis:
The case involved an appeal by the Revenue against the deletion of an addition of ? 7.02 crores made by the Assessing Officer under section 69B of the Income-tax Act, 1961. The assessment year in question was 2012-13. The dispute arose from a search conducted under section 132 of the Act where it was discovered that the assessee had purchased a company for ? 22 crores. Initially, the assessee explained that the purchase was made through a different company and accounted for in their books. However, during the assessment proceedings, the Assessing Officer deemed ? 7.02 crores as unaccounted investment, leading to the addition. The CIT(A) later deleted this addition, stating that the payment was adequately explained by the assessee through banking channels and own savings.

Upon appeal, the Revenue argued that the remaining amount of ? 3 crores paid in cash was unaccounted, justifying the addition. On the contrary, the assessee maintained that all payments were explained and supported by documentary evidence. The Revenue contended that the cash payment was admitted as additional income in a statement recorded under section 132(4) of the Act. The assessee, however, presented a paper book with detailed payment records and cash book extracts to support their claim that the source of the entire payment was legitimate.

After considering the submissions and evidence, the Tribunal noted that the assessee had indeed paid ? 19 crores through banking channels, which was not disputed. The remaining ? 3 crores was paid from the assessee's own savings, as supported by the date-wise payment details provided. The Tribunal found no reason to interfere with the CIT(A)'s order, as the source of the payments was adequately explained. Consequently, the appeal of the Revenue was dismissed, upholding the deletion of the addition of ? 7.02 crores made by the Assessing Officer under section 69B of the Income-tax Act, 1961 for the assessment year 2012-13.