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TMI Blog2012 (4) TMI 468X X X X Extracts X X X X X X X X Extracts X X X X ..... Officer on the basis of the valuation report? (c) Whether the Income Tax Appellate Tribunal was correct in holding that the income earned by the Assessee on the sale and purchase of immovable property cannot be treated as his business income?" 2. Respondent has been served. However, there is no appearance on his behalf and accordingly he is proceeded ex-parte. 3. As far as question (b) is concerned, the same relates to three transactions entered into by the respondent-assessee in respect of property Nos. 102/C-9, Sector 8, Rohini, 216, Block D, Lok Vihar, Delhi and 117/D-12, Sector 8, Rohini (hereinafter referred to as the first, second and third property). 4. The first property, admeasuring 158.73 square meters, was purchased by the assessee on 5th June 1989 from A.K. Jain and V. K. Jain, s/o S. K. Jain, for Rs. 3,00,000/-. No construction was carried out on this plot. The property was sold in the same year for Rs. 3,01,000/-. A capital gain of Rs. 1,000/- was declared for the Income Tax Return for the Assessment Year 1990-91. The second property was jointly purchased with J. K. Jain for a total consideration of Rs. 8.11 lacs. The assessee paid a sum of Rs. 4,05,500/- for his ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not know whether the DVO's report had referred to any sale instance, and if so, whether the properties referred to were similar or identical to the three properties mentioned above. We also note that the sale transactions in respect of the three properties were within a short period after the assessee had acquired them. In absence of these details and material on record before us, we cannot answer question (b) and the same is returned unanswered. On this aspect, we may note that the order of the Assessing Officer only refers to the DVO's report and not the contents thereof. He is completely silent in that regard. 8. The first question relates to property No. 1028, Sector 15-II, Gurgaon admeasuring 300 square meters. The said property was originally allotted in 1989 to one P.C. Gupta, who had paid consideration of Rs.8,19,310/-. As per the allotment letter dated 23rd November, 1989, price of the said property was Rs.7,63,000/-. Sonali Jain, daughter of the assessee had acquired this property from P.C. Gupta on 28th June, 1994 on payment of Rs.4,00,000/-. On the said date Sonali Jain was a minor and was not earning. Subsequently, the property, a vacant plot, was transferred in the n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the balance sheet available at page 2 & 3 of the paper book. Ms. Sonali Jain has shown investment of Rs.4 lakhs in plot no.1028, Sector 15-II Gurgaon. At pae 238 she has also declared long term capital gain in respect of this plot. Her asstt. Was completed u/s 143(3)/158 BD vide order dated 29.12.2000 available at pages 245 to 247 of the paper book. In her case the undisclosed income was determined at Rs.4 lakhs as declared by the assessee in the block return. It is to be pointed out that no addition has been made in her hands on account of investment in the purchase of plot. If the revenue was going to place reliance on the allotment deed in favour of Shri P.C. Gupta as he paid a sum of Rs.8,19,310/- for purchasing the plot then at the first stage addition on account of undisclosed investment should have been made in the case of Ms. Sonali Jain who was an independent assessee and who had also disclosed the transaction in the return. As no addition was made on account of undisclosed investment in the purchase of plot by her on the basis of allotment in the name of Shri Gupta no addition can be made in the hands of the second transferee on the basis of that document. If may be point ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ughter Sonali Jain. The factum that Sonali Jain had sold the property just before her marriage to the respondent-assessee also shows that the respondent-assessee was practically and de-facto the owner of the property. It is well settled that even if income has been assessed in the hands of a third person because of the declaration made in the return, income must be assessed and taxed in the hands of the real owner or recipient or person, who had made the investment. 14. In Income-Tax Officer Vs. Ch. Atchaiah (1996) 1 SCC 417, the Supreme Court had observed as under:- "6. In this appeal, Dr Gauri Shankar, learned counsel for the Revenue, urged that the High Court was clearly in error in holding that under the present Act, the Income Tax Officer has an option to tax either Association of Persons or its members individually. Learned counsel submitted that while such an option was available to the Income Tax Officer under the 1922 Act, no such option is available under the present Act. According to the present Act, the learned counsel says, the right person has to be taxed and merely because a wrong person is taxed, it does not operate as a bar to taxing the right person. In other wo ..... X X X X Extracts X X X X X X X X Extracts X X X X
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