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TMI Blog2012 (10) TMI 153X X X X Extracts X X X X X X X X Extracts X X X X ..... ing any evidence to explain the source of cash deposited by assessee wrongly deleted the additions. Thus there is no question of reducing the addition as per alternate contention of the assessee - in favour of Revenue. Unexplained gift - CIT(A) deleted the addition - Held that:- The assessee failed to prove creditworthiness of the donor and genuine gift in the matter - Despite the donor was maintaining the bank account, no amount was withdrawn from the bank account for giving gift to the assessee - The assessee in the case of the donor also explained that Smt. Sita Devi, Attorney holder sold the land for a consideration of Rs.4,62,000/- in assessment year 2004-05 out of which the donor realized amount of Rs.1,00,000/- and gave it to the assessee as gift, but why the cash was kept for a long period without depositing in the bank account of the donor, was not explained, would also a point to the effect that it was not a genuine gift in the matter. The CIT(A) wrongly deleted the addition of Rs.1,00,000/- - in favour of Revenue. - ITA No. 400/Agra/2011 - - - Dated:- 21-9-2012 - SHRI BHAVNESH SAINI, AND SHRI A.L. GEHLOT, JJ. Appellant by : Km. Anuradha, Jr. D.R. Responden ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rification of above stated facts. (iii). The assessee has not deposited sale price of property / money in bank account in a reasonable time, i.e., in F.Y. 2004-05. (iv). To whom property has been sold, not known to the assessee, it is not acceptable. 2.1 Due to the above reasons, the AO found that the assessee has concocted story to cover up the deposit of cash in her bank account as she has failed to prove the same. The burden is upon the assessee to prove the transaction of property. Therefore, the amount deposited in the bank account was treated as unexplained money u/s. 69A of the IT Act and addition of Rs.11,60,000/- was made to the income of the assessee. 2.2. The assessee also explained that she has received cash gift of Rs.1,00,000/- from her mother-in-law on occasion of her birthday. The assessee was directed to explain the genuineness of the gift and creditworthiness of donor. The assessee was required to furnish the copy of the bank statement from where the donor has withdrawn the money and gifted to the assessee. The assessee has furnished copy of IT return of donor, which did not reflect that any gift has been given to the assessee. The assessee neither furni ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e lac except Rs.1,22,143/- on 24.10.03 which was credited as transfer entries. It is also not acceptable that Smt. Virendra Kumari having cash with her in lacs out of which she has given or gifted to the assessee Smt Neelam Gupta while transaction of small entries are in bank pass book of the donor. Hence on the basis of above facts as well as without supporting evidences, the cash deposited in S.B. A/c by the assessee in her Dehradun account is the concocted story to cover up the deposit of cash Rs. 11,60,000/- and the A.O. was right in adding this amount of Rs. 11,60,000/- as unexplained money u/s 69A of the Act. Further regarding receipt of cash gift of Rs. 1,00,000/- the capacity of the donor does not proved. Hence the addition of Rs. 1,00,000/- by the A.O. by treating the income from other sources u/s 69A of the Act was also correct. I relied upon the order of A.O. passed on 22.12.2008." 2.4 The remand report was confronted to the assessee for giving further comments, in which the assessee more or less repeated the same submissions and it was submitted that the assessee gave a power of attorney to execute the sale deed of her land at village Kakretha to Smt. Sita Devi. Sai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... egard, it is submitted that the assessee Smt. Neelam gupta w/o Shri Rakesh Kumar Gupta through power of attorney holder Smt. Sita Devi w/o Sri Veer pal Singh Village Mohan Nagar, Nagla Rambal, Teh. Distt. Agra has sold the immovable property along with other co-seller Sri Dr. Sri Narain Gupta s/o Sri Tota Ram R/o Rajput Mohalla, Fatehabad, Tehsil Agra to Sri Balaji Sehkari Avas Samiti Ltd., Agra through its secretary Sri Banbari Lal Village Kakretha, Teh. Distt. Agra on 16.12.2005 for Rs. 27,50,000/-. Further from the other sale deed dated 16.12.2005 Smt. Virendra Kumari w/o Sri Vinod Kumar R/o Nagla Dhani, Tehsil Fatehabad, Distt. Agra through the power of attorney holder Smt. Sita Devi w/o Sri Veer pal Singh, R/o Mohan Nagar, Nagla Rambal, Teh. Distt. Agra along with two other Co-seller Sri Narain s/o Sri Tota Ram and Sri Rajeev Kumar s/o Sri Hariom, Fatehabad, Agra have sold the land to Sri Balaji Sehkari Avas Samiti Ltd., Agra on 16.12.2005 for Rs. 27,00,000/-. On perusal of these sale deeds it is not clear that how much amount was paid by the society to these sellers separately against purchase of land. The notice u/s 133(6) of I.T. Act was issued to the society - Sri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... their returns filed for A. Y. 2006- 07. So far as the cash deposit of Rs.11,60,000/- and Rs.1,00,000/- in the bank account of smt. Neelam Gupta during F. Y. 2005-06 was told as the amount being received after sale of property during F. Y. 2003-04, and the assessee had recovered this amount from the power of attorney holder Smt. Sita Devi during F. Y. 2005-06 and was deposited in her bank account. During the course of assessment proceedings, the assessee did not prove that these cash deposits were related with the amount received against sale consideration of property. Thus as per assessee's reply, it has been established that the assessee had also sold some of the property during F.Y. 2003-04 and the sale consideration has been received by her accordingly. Further the assessee as well as her mother-in-law smt. Virendra Kumari have also sold the land during F. Y. 2005-06 to Sri Balaji sehkari Avas samiti Ltd., Agra and the sale consideration of their shares were deposited in their bank accounts. Thus the amount so deposited in bank account, relates against the sale consideration of land for the F. Y. 2005-06 relevant to A. Y. 200607 and it may not be to the F. Y. 2003-04 releva ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... te with her before selling of this land and she did not inform as to when this land was sold. However, when sale of this land came to her knowledge, she declared the capital gain on the sale of this land giving the date of sale as date of signing of agreement with the Power of Attorney Holder as on 04.04.2003 and I find the same date is given in the computation of capital gain for A.Y. 2004-05 as claimed by the appellant. The ld. AR of the Appellant has explained during the appellate proceedings that the date of sale (04.04.2003) was taken in view of the provisions of section 2(47)(v) as the exact date of sale of land was not known to the appellant. Section 2(47)(v) provides the date of transfer in relation to the property sold in view of part performance of a contract of the nature referred to in section 53A of the Transfer of Property Act, 1882 which provides that if possession of the property is given to the purchaser, the sale of the property can be considered from that date even if the consideration is received subsequently. Though the power of attorney holder is not a purchaser of property in exact sense, the possession of the property was transferred from the appellant to th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ch has arisen after sale consideration of land was received by her during F.Y. 2005-06. Therefore, as far as source of deposit of cash of Rs.11,60,000/-in the bank account of the appellant is concerned, it is fairly proved after an enquiry was conducted by the AO during the remand stage that this cash was deposited out of the sale consideration of the land. In view of these findings, I am inclined to accept the explanation of the appellant that the cash recovered by her from the Attorney Holder on sale of land at Kakretha was used in depositing the cash in her bank account. For the purpose of explaining the cash deposits of Rs.11,60,000/- in bank account, she has also filed a cash flow statement from 01.04.2003 to 31.03.2006 showing that the cash received on sale of property at Kakretha alongwith the cash received by her from rent and other income were used in depositing of cash in the bank account. No adverse comment has been offered by the AO on this cash flow statement. Therefore, I find that the appellant was able to explain the deposits of cash of Rs. 11,60,000/- in her bank account through this cash flow statement. Copy of this cash flow statement is annexed with this order ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pta for Rs. 27,50,000/- and Rs. 27,00,000/- respectively. Out of the total sale proceeds of Rs. 54,50,000/-, Rs.26,83,333/- was paid to Smt. Sita Devi, Rs.18,16,700/- to Shri S.N. Gupta and Rs. 9,00,000/- to Rajeev Kumar through cheque and Rs.50,000/- in cash as advance as per the report submitted by the AO vide his letter dated 31.03.2011. So far, as per the details submitted by the Ld. AR during the appeal proceeding, out of the above sale proceeds, only Rs. 9,25,000/- in the hand of the appellant (Smt. Neelam Gupta) and Rs.4,62,000/- in the hand of Smt. Virendra Gupta has been offered for taxation under the head Long Term Capital Gain for the AY 2004-05 on the basis of the date of execution of the Power of Attorney Holder agreement and provision of section 2(47)(v). But no details are available as to how the balance amount of sale proceed of this land has been offered for taxation. Therefore, the AO is directed to make necessary enquiry from Smt. Sita Devi to ascertain as to how much amount was paid back by her to the appellant (Smt. Neelam Gupta) and Smt. Virendra Gupta out of the total sale proceed of the lands for which she was given Power of Attorney by them and how much amo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat she has received amount from Smt. Sita Devi on sale of property. Therefore, the ld. CIT(A), without any basis, deleted both the additions. The ld. DR heavily relied upon the findings of the AO. 4. On the other hand, the ld. Counsel for the assessee reiterated the submissions made before the ld. CIT(A) and referred to paper book page 1, which is reply filed before the AO and submitted that when the capital gain was shown in assessment year 2004-05 on filing revised return and land value at Kakretha sold on 04.04.2003 was mentioned at Rs.9,25,000/-, the assessee explained the source of deposit of cash in the bank account. Copies of revised return are filed at page 5 6 of the paper book, which was filed much earlier than the filing of the return for the assessment year under appeal. He has submitted that when the assessee was not aware of sale of land by Attorney, the date of sale as per power of attorney dated 04.04.2003 was correctly taken, which was supported by cash flow statement. There was no other income with the assessee. He has submitted that AO, however, in the remand proceedings collected evidences that land was sold on 16.12.2005 which fall in assessment year 200 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e property in question at any stage and also did not make any request to the AO to summon Smt. Sita Devi for examination. As such, the AO has rightly drawn adverse inference against the assessee. The ld. CIT(A) wholly on irrelevant consideration did not take into consideration such facts while deciding the appeal of the assessee. The assessee did not file any confirmation from the Attorney and if the version of the assessee is to be accepted that Smt. Sita Devi, Attorney had betrayed the assessee and was not co-operating with the assessee in not giving the copy of sale deed, it is highly unbelievable that such person would hand over huge cash being the sale consideration of land to the assessee without executing any document. The assessee did not furnish any evidence before the authorities below that Smt. Sita Devi, Attorney actually gave cash in question to the assessee on selling the property. No details of sale of land were even intimated to the assessee. Since no evidence was furnished by the assessee that she actually received cash from Smt. Sita Devi, the power of attorney holder, the ld. CIT(A) should not have deleted the addition. Further the conduct of the assessee in not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and the assessee also maintained one bank account at Agra with Vijaya Bank, but the amount in question, i.e., Rs.11,60,000/- was not deposited in the bank account at Agra, but it was deposited in cash in Bank of Rajasthan Ltd. at Dehradun. Making deposit in cash also clearly pointed out that the assessee concocted the entire story to cover up the unaccounted cash deposit in the bank account. During the course of arguments, both the parties explained that the case of assessee was selected for scrutiny on getting information that the assessee deposited unaccounted cash in bank account with Bank of Rajasthan Ltd. at Dehradun. The above conduct of the assessee is unnatural and speaks against herself and fully supports the case of the Assessing Officer. Hon ble Supreme Court in the case of CIT Vs Shri Durga Prasad More, 82 ITR 540 and in the case of Smt. Sumati Dayal Vs CIT 214 ITR 801, held that the Courts and Tribunals have to judge the evidences before them by applying the test of human probabilities after considering the surrounding circumstances. If the said test is applied to the facts and circumstances of the case, it is clearly established that the assessee has failed to exp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ft certificate which is not sufficient to prove the genuine gift in the matter. The assessee explained that the donor also received the amount in question from Smt. Sita Devi, Attorney for the purpose of giving gift to the assessee. Further, no such evidence in this regard has been furnished and on the same reasoning we have set aside the order of the ld. CIT(A) in the case of assessee. Therefore, it is unbelievable that the donor would have received the amount in question from Smt. Sita Devi, power of attorney holder. Thus, the objections of the AO have been ignored by the ld. CIT(A) while deleting the addition. No evidence or material was produced before the authorities below for showing any love and affection. Since no sufficient evidence has been filed before the authorities below to prove the genuineness of the gift and the assessee also failed to prove creditworthiness of the donor, therefore, it is clear that the gift in the matter is not genuine gift and arranged affairs of the assessee. Hon ble Delhi High Court in the case of CIT vs. Anil Kumar 292 ITR 552 held In the case of gifts mere identification of the donor and showing the movement of the gift amount through ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed to the Vice President who concurred with the findings and conclusion of the Assessing Officer and the Commissioner (Appeals). On appeal the High Court re-appreciated the evidence and substituted its own findings and came to the conclusion that the reasons assigned by the Tribunal were in the realm of surmises, conjecture and suspicion. On appeal to the Supreme Court: Held, reversing the decision of High Court, that findings of the Assessing Officer, the Commissioner (Appeals) and the Tribunal were based on the material on record and not on any conjectures and surmises. That the money came by way of bank cheques and was paid through the process of banking transaction was not by itself of any consequence. The High Court misdirected itself and erred in disturbing the concurrent findings of fact. 6.2. Hon ble Punjab and Haryana High Court in the case of Yash Pal Goel Vs CIT 310 ITR 75 held Held, dismissing the appeal that the financial position of M. suggested that he neither had the capacity to make the gift nor the source from where the gift was made. No reason whatsoever had been assigned for gifting such a huge amount by M to the assessee. M never visited the home of the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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