2022 (7) TMI 687 - AT - Income Tax

Unexplained credit in the capital account of the assessee - During the course of survey operations documents/books of account/loose papers were found and impounded - HELD THAT - There is no evidence that is forthcoming on behalf of the assessee to show that, as a matter of fact the payments were made under this agreement dated 06/11/2015, on the date so mentioned therein and the sale deeds were accordingly registered on the name of the vendees. There is also no denial of the fact that, as a matter of fact, the sale deeds were registered on 22/06/2016 in respect of the properties that is to be found in the agreement of sale dated 06/11/2015. Apart from the fact that the sale consideration under these four sale deeds was Rs. 23.77 lakhs, even such amount was also received in the financial year relevant for the assessment year 2017-18. The findings of the Ld. CIT(A) that the assessee bought various properties during the year and the property was bought on 30/06/2015 which was earlier to the agreement of sale, wherein the credit issue of Rs. 43 lakhs was to be considered, goes unchallenged and unimpeached. We are of the considered opinion that the alleged agreement of sale dated 06/11/2015 is not at all helpful in proving the case of the assessee and there is no evidence to show that the assessee received the entire sale consideration of Rs. 43 lakhs during the previous year relevant to the assessment year 2016-17. Even if we believe this, still the doubt entertained by the Ld. CIT(A) that inasmuch as the assessee bought property worth on 30/06/2015 wherein the credit issue was to be considered, goes unimpeached. We, therefore, do not find any reasons to interfere with the findings and the conclusions reached by the authorities below. There is no merit in the grounds of appeal and the same are dismissed.

Summary

Issues Involved:
Addition of Rs. 43 lakhs as unexplained credit in the capital account of the assessee.

Analysis:
The only issue in this appeal was the addition of Rs. 43 lakhs as unexplained credit in the capital account of the assessee for the assessment year 2016-17. The assessee claimed that the amount was received as sale consideration for agricultural land beyond specified limits. However, the Assessing Officer found discrepancies in the documentation and the origin of the funds. The Assessing Officer concluded that the assessee failed to substantiate the claim and added the amount to the income from other sources.

Ld. CIT(A) Decision:
The Commissioner of Income Tax (Appeals) upheld the Assessing Officer's decision, stating that the sale consideration was reduced to Rs. 23.77 lakhs based on sale deeds executed later. The CIT(A) rejected the contentions of the assessee, emphasizing that the documentary evidence provided was insufficient to support the claim. The CIT(A) also noted the purchase of other properties by the assessee during the same period, further complicating the credit issue.

Appellant's Argument:
The appellant contended that the amount was indeed related to the sale of agricultural lands, relying heavily on the agreement dated 06/11/2015. The appellant argued that the agreement, impounded during the survey, supported the claim of receiving the sale consideration.

Final Tribunal Decision:
After reviewing the arguments and evidence presented, the Tribunal found that the appellant failed to provide concrete evidence of receiving the entire sale consideration of Rs. 43 lakhs. The Tribunal highlighted discrepancies between the agreement dates and the actual registration of sale deeds, indicating inconsistencies in the appellant's claims. The Tribunal agreed with the lower authorities' findings and dismissed the appeal, affirming the addition of Rs. 43 lakhs to the assessee's income.

This detailed analysis of the judgment highlights the key arguments, decisions, and reasoning behind the addition of unexplained credit in the capital account of the assessee, providing a comprehensive overview of the case.