2012 (8) TMI 42 - AT - Income Tax

Addition in respect of gifts of immovable properties - assessee submitted that mistake of the accountant as journal entries were wrongly made to the credit side of the Capital Account - Held that - CIT(A) has given a finding on the basis of remand report of the A.O that no revised balance sheet was produced before AO and also the balance sheet of earlier years to which assessee contented that he was not given opportunity to explain the revised balance sheet - as in the interest of justice this matter is remitted back to the file of AO to adjudicate afresh after giving sufficient opportunity to the assessee - in favour of assessee for statistical purposes. Addition made under Section 68 - Held that - Considering the assessee submission that if he is afforded opportunity he will furnish confirmation from Sh. Rahul V shah and Shri Naresh V. Shah who gave interest free loan to the assessee and place genuineness and credit worthiness - this issue is remitted back to the file of AO for fresh decision of the transaction - in favour of assessee for statistical purposes. Addition of income in respect of on-money on sale of agricultural land - Held that - Finding force into the contention of assessee that if it is proved that land was agriculture land, therefore, would not be subject to capital gain tax liability. Therefore, after considering totality of facts, this issue is also remitted back to the file of AO fresh decision. Addition of entire alleged on money involved in the sale of land at village Godhavi as the income of the Assessee failing to appreciate the fact that the land in question was owned and sold jointly by the appellant with his wife - this issue is also restored to the file of AO for fresh adjudication

Summary

Issues:
- Appeal against the order of the Ld. Commissioner of Income Tax(Appeal)-XV, Ahmedabad dated 23rd December, 2011.

Assessee's Appeal - ITA No. 226/Ahm/2012:
1. The assessee contested the addition of Rs. 1,41,00,000/- for gifts of immovable properties due to a mistake in journal entries, which was rectified later. The Commissioner confirmed this addition, suspecting an attempt to introduce on-money.
2. Addition under section 68 of the Income Tax Act, 1961, for a loan from Shri Rahul N. Shah of Rs. 51,00,000/- was also contested.
3. Addition of Rs. 3,60,00,000/- for on-money on the sale of agricultural land at Village Godhavi was disputed.
4. Disagreement on the status of the agricultural land sold at Village Godhavi as a Capital Asset within the limit of the Ahmedabad Municipal Corporation.
5. Dispute regarding the full amount of on-money added as income, despite the appellant having only a one-half share in the land.
6. The case was remitted back to the Assessing Officer to consider revised balance sheets and provide the appellant with a fair opportunity to explain.

Revenue's Appeal - ITA No. 477/Ahd/2012:
1. The Revenue challenged the restriction of disallowance to Rs. 51,00,000/- out of Rs. 64,90,000/- made by the Assessing Officer on unsecured loans.
2. Since the issue of unsecured loans was remitted back in the assessee's appeal, this ground of the Revenue's appeal was also remitted back to the Assessing Officer for fresh decision.

The Tribunal found that the land in question was jointly owned and sold by the appellant with his wife, leading to the remittance of several issues back to the Assessing Officer for fresh adjudication. The appellant's contentions regarding the gifts of immovable properties, loan transactions, status of agricultural land, and on-money were considered, emphasizing the need for proper verification and substantiation. The Revenue's appeal on the disallowance of unsecured loans was also remitted back for a fresh decision. Both appeals were allowed for statistical purposes, indicating a need for further assessment and clarification on the disputed matters.