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2023 (11) TMI 327 - AT - Income TaxAddition u/s 69 - unpaid purchase consideration and the future commitment made to the builder by the assessee - HELD THAT - Merely at the time of registration and TDS process the total amount of investment considered but the same cannot be taken as a basis for which the actual payment neither due nor paid by the assessee. Thus, the same cannot be considered as unexplained investment by the assessee. We have gone through the proposals,letters and relevant deed of purchase of property placed on record before us and before ld. CIT(A). The said information contended by the ld. AR of the assessee is based on evidence which has not been controverted that the assessee has not paid the said amount. Hence, in the absence of clear evidence placed before us we are of the considered view that once the assessee has not made any payment the same cannot be added as unexplained investment. The revenue did not bring on record contraryfact that the assessee has paid this amount. But in fact it is based on the record that the same is considered as due by the builder. Thus, the due payment cannot be added as unexplained investment by the assessee. Therefore, we are of the considered view that the addition does not have leg to stands and the same is thus vacated. Addition of stamp duty - assessee has already placed record the evidence to prove that the assessee has paid a sum partly. Balance amount has been paid out of the loan taken by his father. The proof of payment in the form of bank account maintained by his father is available on record. Therefore, since the source of this payment of stamp duty duly discharged by the assessee, the same cannot be added in the hands of the assessee merely stating that the assessee might have given this money to his father but in fact his father has taken housing loan and from that ICICI bank housing loan, this payment has been made. Therefore, same cannot be added in the hands of the assessee as unexplained investments. Addition next assessee based on the deed of seller proved that the assessee has out of total deal paid a sum which is not disputed, and a stamp duty and other related payment is yet not paid by the assessee but the builder has in the schedule just debited the amount. Therefore, when the said amount is not paid the same cannot be considered as an unexplained investment of the assessee. Based on these facts already on record the addition is vacated. Addition next assessee has along with his father purchased a property at Banipark, Jaipur for an amount of Rs. 91,64,348/- and 50% of that amount which comes to Rs. 45,82,174/- has been added as unexplained investments of the assessee on the pretext that the whole of the payment is made by the assessee and therefore, he has not considered the fact that the father of the assessee taken a loan to meet investment of his part for which the ld. AR of the assessee relied upon the evidence of loan taken and payment of cheque made by his father from his bank account. This factual aspect of the matter has not been challenged. Thus, based on this discussion, the addition is vacated. Based on the detailed findings recorded here in above, we are of the considered view that the addition above is factually incorrect and thus vacated. Thus, Ground raised by the assessee is allowed.
Issues Involved:
1. Validity of Notice under Section 148. 2. Treatment of Unexplained Investment under Section 69. 3. Addition of Income of Deceased Person. 4. Addition of Interest Income and Disallowance of TDS Credit. 5. Levy of Higher Tax Rate. 6. Non-consideration of Withdrawal Application by CIT(A). 7. Levy of Interest under Sections 234A, 234B, and 234C. 8. Initiation of Penalty under Sections 270A, 271AAC(1), and 272A(1)(d). Summary: 1. Validity of Notice under Section 148: The assessee argued that the notice under Section 148 was issued without proper verification of facts, making the proceedings void and bad in law. The Tribunal referenced multiple judicial precedents, including the Gujarat High Court and Patna High Court, to conclude that the notice was based on non-application of mind and thus invalid. 2. Treatment of Unexplained Investment under Section 69: The Tribunal found that the Assessing Officer (AO) added Rs. 1,10,82,319/- as unexplained investment without proper verification. The AO failed to consider that the payments for the Jaipur flat were made in earlier years and the Pune flat payments were to be made in subsequent years. The Tribunal vacated the addition, stating that the AO's assumptions were incorrect and not based on evidence. 3. Addition of Income of Deceased Person: The AO added the income of the deceased father of the assessee to the assessee's income. The Tribunal noted that the AO did not issue any notice to the deceased and that the payments were made from the deceased's bank account. The Tribunal vacated this addition, citing lack of evidence and improper procedure. 4. Addition of Interest Income and Disallowance of TDS Credit: The Tribunal found that the interest income of Rs. 488/- was already declared by the assessee, and the disallowance of TDS credit of Rs. 151/- was against the law. The Tribunal ruled in favor of the assessee, allowing the TDS credit. 5. Levy of Higher Tax Rate: The AO levied a 60% tax rate instead of 30%. The Tribunal did not address this issue as it was "not pressed" by the assessee. 6. Non-consideration of Withdrawal Application by CIT(A): The Tribunal noted that the CIT(A) dismissed the appeal as not maintainable, citing that the assessee had already filed objections before the Dispute Resolution Panel (DRP). However, the Tribunal found that the CIT(A) erred in not considering the withdrawal application and ruled in favor of the assessee. 7. Levy of Interest under Sections 234A, 234B, and 234C: The Tribunal did not specifically address this issue, stating that it was interlinked with the main grounds and consequential in nature. 8. Initiation of Penalty under Sections 270A, 271AAC(1), and 272A(1)(d): The Tribunal did not specifically address this issue, stating that it was interlinked with the main grounds and consequential in nature. Conclusion: The Tribunal allowed the appeal of the assessee, vacating the additions made by the AO and ruling in favor of the assessee on all significant grounds. The order was pronounced in the open court on 05/10/2023.
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