2020 (12) TMI 9 - AT - Income Tax

Addition through a non speaking order - assessment U/s. 144 - Sale of Arricultural land - AO assessed income after allowing credit being sale consideration of said land as per the sale deed out of total bank deposits - CIT(A) during the appellate proceedings had admitted additional evidence filed by the assessee through an application under Rule 46A - HELD THAT - Registered sale deed dated 05/05/2010 was executed by the assessee in favour of one Prithivi Singh S/o. Jaipal for the sale consideration of ₹ 6,95,000/- and this sale deed do not contain the details of execution of alleged agreement to sell dated 04/03/2010. As gone through the copy of agreement dated 04/03/2010 which was executed between the assessee and one Jaipal. On careful analyzing the said agreement dated 04/03/2010, we noticed that this agreement was not executed between the assessee and the said purchaser of land i.e. Prithivi Singh rather the said agreement has been executed between the assessee and one Jaipal S/o- Shri Banshi Ram who according to assessee, father of the purchaser Shri Prithivi Singh. Even otherwise, the said agreement dated 04/03/2010 do not contain signature of Jaipal on the said agreement which goes to prove that Jaipal was never signatory or party to the said agreement. Therefore, this document dated 04/03/2010 carries no evidentiary value. When a registered document has been placed on record Presumption is to be drawn that registered document in the shape of registered sale deed dated 05/05/2010 carried evidentiary value which shows that the consideration paid to the assessee for the sale of the land in question was only at ₹ 6,95,600/- and the A.O. had rightly completed the assessment at ₹ 13,79,400/- after allowing credit of ₹ 6,95,600/- being sale consideration of the said land as per sale deed out of the total bank deposits of ₹ 20.75 lacs. The decision of the Coordinate Bench of this Tribunal in the case of Shri Pappu Ram Saran 2020 (9) TMI 228 - ITAT JAIPUR is of no help to the assessee as the facts contained in that case is altogether different from the facts of the present case- No new facts or circumstances have been brought before us in order to controvert or rebut the findings so recorded by the ld. CIT(A), therefore, we uphold the order of the ld. CIT(A) qua this issue. Appeal of the assessee is dismissed.

Summary

Issues Involved:
1. Confirmation of the addition of ?13,79,400/- by the CIT(A).
2. Chargeability of interest under Sections 234A and 234B of the Income Tax Act.

Detailed Analysis:

1. Confirmation of the Addition of ?13,79,400/- by the CIT(A):

The assessee, an illiterate farmer, deposited ?19.50 lacs in his bank account on 06/05/2010. The Assessing Officer (A.O.) issued a notice under Section 148 of the Income Tax Act on 06/12/2013 based on this cash deposit. The assessee responded with a sale deed showing the sale of 2 Bigha 7 Biswa agricultural land for ?6,95,600/-. The A.O. allowed this amount as credit and treated the remaining ?13,79,400/- as unexplained income.

During the appellate proceedings, the assessee claimed the land was actually sold for ?25,36,500/- but the sale deed was executed at the DLC rate of ?6,95,600/- on the purchaser's insistence. An agreement to this effect, allegedly made before the sale deed, was not initially traceable but later submitted as additional evidence. The assessee argued that the remaining amount of ?19.50 lacs deposited in the bank was part of the total sale consideration.

The CIT(A) admitted the additional evidence but upheld the A.O.'s decision, noting that the agreement was not between the assessee and the actual purchaser but between the assessee and the purchaser's father, Jaipal. Moreover, the agreement lacked Jaipal's signature, diminishing its evidentiary value.

The Tribunal agreed with the CIT(A), emphasizing that the registered sale deed dated 05/05/2010, which showed a sale consideration of ?6,95,600/-, carried more evidentiary value than the unregistered agreement. The Tribunal also noted that the A.O. had issued multiple summons to Jaipal for verification, but he did not comply. Consequently, the Tribunal upheld the addition of ?13,79,400/- as unexplained income.

2. Chargeability of Interest Under Sections 234A and 234B:

Since the main ground of appeal regarding the addition of ?13,79,400/- was dismissed, the Tribunal also dismissed the appeal concerning the chargeability of interest under Sections 234A and 234B of the Income Tax Act.

Conclusion:

The appeal by the assessee was dismissed in its entirety. The Tribunal upheld the CIT(A)'s order confirming the addition of ?13,79,400/- as unexplained income and the chargeability of interest under Sections 234A and 234B. The decision was pronounced in the open court on 09th November 2020.