2018 (3) TMI 1802 - HC - Income Tax

Unexplained investment u/s 69 - statement u/s 131 was recorded from the assessee (appellant) Vijay Jain, Director of the Company, wherein it was admitted that he has purchased shares of ₹ 35,000/- of M/s. Kunjika Construction Private Limited and also invested in share application money at ₹ 44,28,000/- - HELD THAT - Statement is to be believed as a whole and not in piecemeal as one part suits to the assessee and other part does not suits to the assessee. Shri Santosh Kumar Lalwani in reply to Question No.14 of his statement has clearly stated that he has entered into this agreement for purchase on 15.08.2005 and paid an amount of ₹ 8,00,000/- as advance (Bayana), after seeing the executors of said agreement for purchase of 1/3rd land had an agreement with original owner of the land in which it was clearly mentioned that they have right to sell the said property and they have paid ₹ 20 lakhs towards Bayana for the purchase of said land. We are of the view that the Tribunal rightly upheld addition of ₹ 20,00,000/- (rupees twenty lakhs) as unexplained investment under Section 69 - findings recorded by the learned authorities are the findings of fact based on the agreement of purchase of land dated 15.08.2005 and the same was admitted by Shri Santosh Kumar Lalwani in reply to Question No.14 of his statement and thus, we cannot accept the contention of the learned counsel for the appellant that the learned authorities have committed an error in relying on the statement of Shri Santosh Kumar Lalwani. - Decided against assessee.

Summary

Issues involved:
1. Addition of unexplained investment under Section 69 of the Income Tax Act, 1961.
2. Addition of cash deposits and loans not explained by the assessee.
3. Confirmation of additions by the Income Tax Appellate Tribunal.

Detailed Analysis:
1. The issue of unexplained investment under Section 69 of the Income Tax Act was raised in this case. The appellant had invested amounts without proper explanation, leading to additions by the Assessing Officer. The Tribunal upheld the addition of ?20,00,000 as unexplained investment based on agreements and statements provided. The Tribunal considered the explanations offered by the appellant and other parties involved, ultimately dismissing the appeal as lacking merit or substantial legal questions.

2. The second issue involved additions related to cash deposits and loans not adequately explained by the assessee. The Assessing Officer found discrepancies in the sources of funds and cash transactions made by the appellant. The Commissioner of Income Tax (Appeals) partially allowed some claims while confirming others. The Tribunal affirmed the lower authorities' findings, confirming some additions and deleting others after thorough examination of the evidence and explanations provided by the appellant.

3. The final issue pertained to the confirmation of additions by the Income Tax Appellate Tribunal. The Tribunal reviewed the assessments made by the lower authorities, considering the evidence, statements, and agreements presented. The Tribunal upheld certain additions while deleting others based on the credibility and reliability of the explanations provided by the appellant and other parties involved. Ultimately, the Tribunal dismissed the income tax appeal, concluding that no substantial legal questions arose from the case.

In conclusion, the judgment addressed various issues related to unexplained investments, cash deposits, and loans not adequately explained by the assessee. The Tribunal carefully reviewed the evidence, statements, and agreements to make informed decisions on the additions and deletions, ultimately dismissing the appeal due to lack of merit or substantial legal questions.