2015 (8) TMI 356 - AT - Income Tax

Unexplained deposits in the bank - sale of land - Held that - Undisputedly the sale consideration declared in the sale deed was at ₹ 1,80,000/- and accordingly, the stamp duty was paid thereon on its registration. The assessee has jointly owned the agricultural land, therefore, the share was shown to be at ₹ 90,000/-. It is also an admitted fact that assessee has initially filed original return of income declaring the capital gains on the basis of the sale value of ₹ 90,000/- of his share. But when the substantial amount of cash deposits in the bank was noticed, the assesee has taken a different pleas. Initially it was contended that the source of deposits was from agricultural income and later on he took another stand that it was out of the sale consideration received on sale of agricultural land. In support thereof no evidence was filed. Though the AO has asked the assessee to furnish the confirmation letters of the buyers or any other evidence in support thereof. At the instance of the assessee the buyer was also examined by the AO and she has categorically denied the payment over and above the sale consideration declared for the sale deed. Copy of the statement is also filed before us. Except the affidavit of the assessee in support of his contention, no other evidence is available on the basis of which an inference can be drawn in favour of the assessee. Affidavit of assessee is a self serving document, therefore, on the basis of affidavit, the additions made by the AO cannot be deleted. We have also carefully examined the various judgments referred to by the assessee and we find that these judgments are rendered on computation of long term capital gains, but in those judgments there was no dispute with regard to sale consideration received by the assessee. We therefore held that Revenue authorities have rightly treated the cash deposits in the bank account of the assessee as unexplained cash deposits and made the addition of the same. Case of CIT vs. Intezar Ali distinguished 2013 (8) TMI 704 - ALLAHABAD HIGH COURT . - Decided against assessee.

Summary

Issues:
1. Unexplained cash deposits in bank account.
2. Source of cash deposits.
3. Discrepancy in sale consideration.
4. Reliance on case laws for defense.

Issue 1: Unexplained cash deposits in bank account:
The Assessee appealed against the Order of the Ld. CIT(A), Meerut, challenging the addition of Rs. 14,93,000 as unexplained deposits in the bank. The deposits were made in the Savings Bank A/c No. 4167 with Punjab National Bank, Meerut, out of the sale consideration of land sold to Smt. Vijay Kumari. The AO found discrepancies in the explanations provided by the Assessee regarding the source of these deposits. Despite various notices and opportunities to substantiate, the Assessee failed to provide sufficient evidence. The AO made the addition of Rs. 14,93,000 as unexplained deposits, which was confirmed by the Ld. CIT(A).

Issue 2: Source of cash deposits:
The Assessee claimed that the cash deposits were from the sale consideration of agricultural land. However, the AO found inconsistencies in the explanations provided by the Assessee regarding the actual sale consideration received. The Assessee failed to produce confirmation letters from the buyers or any other substantial evidence to support the claim. The buyer, Smt. Vijay Kumari, denied making any additional cash payments beyond the declared sale consideration. The Tribunal noted that the Assessee's affidavit alone was not sufficient to substantiate the source of the cash deposits, leading to the confirmation of the addition by the Revenue authorities.

Issue 3: Discrepancy in sale consideration:
The Assessee contended that discrepancies in the sale consideration were common due to market rates being higher than the declared values. However, the Tribunal observed that the sale consideration declared in the sale deed was Rs. 1,80,000, with stamp duty paid accordingly. The Assessee initially declared capital gains based on a share of Rs. 90,000 but later revised the claim to Rs. 15,83,000, without providing concrete evidence. The Tribunal found that apart from the Assessee's self-serving affidavit, no substantial evidence was presented to support the revised sale consideration, leading to the rejection of the Assessee's contentions.

Issue 4: Reliance on case laws for defense:
The Assessee relied on various judgments related to the computation of long-term capital gains to support their contentions. However, the Tribunal noted that these judgments did not involve disputes over the actual sale consideration received by the Assessee. The Ld. CIT(DR) argued that the case laws cited by the Assessee were not directly applicable to the present case, where the main issue revolved around the source of unexplained cash deposits rather than the computation of capital gains. The Tribunal found the facts of the present case distinct from those in the cited judgments, as the Assessee failed to provide concrete evidence to substantiate the revised sale consideration.

In conclusion, the Tribunal upheld the additions made by the Revenue authorities regarding the unexplained cash deposits in the bank account, as the Assessee failed to provide substantial evidence to support the source of deposits and the revised sale consideration. The reliance on case laws for defense was deemed inapplicable to the present case, leading to the dismissal of the Assessee's appeal.