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TMI Blog2012 (11) TMI 627X X X X Extracts X X X X X X X X Extracts X X X X ..... cution of agreement to sell. The Assessing Officer is directed to pass on the information to the concerned Assessing Officer for taking appropriate action in the case of Shri Bakhtawar Singh(purchaser) to examine the source of investment of Rs. 15.00 lakhs which is in dispute - CIT(A) has very correctly decided the issue after taking all precautions and nothing wrong with the order of the ld. CIT(A) and the same is confirmed - In the result, appeal filed by the revenue is dismissed. - ITA No. 133/Chd/2012 - - - Dated:- 30-7-2012 - SHRI T.R. SOOD AND Ms. SUSHMA CHOWLA, JJ. Appellant by: Smt. Jaishree Sharma Respondent by: Shri Parikshit Aggarwal ORDER PER T.R. SOOD, A.M In this appeal Revenue has raised the following ground: Whether on the facts and circumstances of the case, the ld. CIT(A) has erred in deleting the addition of Rs. 15,00,000/- made on account of unexplained cash introduced, when the assessee as well as creditor failed to prove creditworthiness of the creditor. 2. After hearing both the parties we find that during assessment proceedings the Assessing Officer noticed that as per cash book the assessee has shown cash receipts ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... local money changer. However, as per bank account statement of Ms. Sarabjit Kaur, daughter in law, placed on record, it shows that very meager amounts have been received and the same were insufficient to source his purchase. Further no other ITRs or bank account statement or J-Form etc. were produced which could satisfactorily prove his credit worthiness. 2.5 Thus, from the compliance of summons issue and the statement recorded, it is revealed that though the identity and genuineness of creditor has been proved but his credit-worthiness is highly doubtful in the absence of proper documentary evidence with the purchaser to explain the source of investment of Rs. 15.00 lakhs. A copy of the statement recorded is enclosed for your kind perusal. 2.6 Further, even though the purchaser was not a resident of Chandigarh but still he had not changed his address and he continued to reside at the same place since that agreement of sale and Assessing Officer had given sufficient time and opportunity to the assessee to produce such evidence/person, so there is no satisfactory reason which prevented assessee to produce this evidence before the Assessing Officer during the course of assessmen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... advance was enclosed and property was a Godown at Ziirakpur (17 marlas). It was clearly stated that the same was sold to Shri Bakhtawar Singh son of Gurdas Ram r/o 172, Village Kalwan, Tehsil Anandpur Sahib, Distt. Ropar. It was also informed that the assessee was not in touch with the party as the agreement to sell had been cancelled and the same was retained by the prospective buyer. Time of five days was sought for collecting confirmation etc. The Assessing Officer was further informed that he desired verification may be made from the party, therefore, whatever information was available with the assessee was duly furnished. In any case when these particulars were furnished before the ld. CIT(A) the same were sent back to the Assessing Officer for his remand. During remand, Shri Bakhtawar Singh appeared before the Assessing Officer in response to summons u/s 131 and his statement was also recorded. Shri Bakhtawar Singh clearly admitted that he has agreed to enter into the transaction for purchase of property and given advance of Rs. 15.00 lakhs in advance. He also explained the source before the Assessing Officer and if the Assessing Officer was not satisfied with the explanati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... purchaser for undisclosed investment. The case law cited by the ld. DR for the revenue is totally distinguishable because in that case the assessee had claimed certain interest on loan taken from Kalinga Foundation Trust. The Trust had also invested in the shares of Kalinga Tubes Ltd. Since the assessee could not given satisfactory explanation regarding the person who had donated the money to the Trust it was held by the Assessing Officer that the money belonged to the assessee only. From the facts it is clear that the Trust was also being controlled by the assessee only. The addition was deleted by the Tribunal. On appeal by the Revenue the Hon'ble Supreme Court held as under:- That the two basic questions were whether the donations collected by the Trust were genuine and whether the Department could rely upon the large amount of material collected by the Department subsequent to the decision of the Sc ion JAIN s case. The identity and creditworthiness of the donors had not been established and the large amounts received as donations by the Trust were for over a decade lying as cash without being invested anywhere. The question whether the moneys were raised by the Trust as don ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessing Officer and statement of Shri Bakhtawar Singh was recorded u/s 131 by the Assessing Officer. Shri Bakhtawar Singh produced the original of agreement to sell entered with the appellant and confirmed that agreement was cancelled due to shortage of funds at his end. The Assessing Officer asked Shri Bakhtawar Singh about the source of money of Rs. 15.00 lakhs to which he had replied that the amount was out of sale of poplar trees received in cash, previous savings and the money received from his sons through money exchanger. According to the Assessing Officer, the creditworthiness of Shri Bakhtawar Singh was highly doubtful, but the fact remains that he has not denied that he had not entered into agreement with the appellant for purchase of a godown for which he had paid Rs. 15.00 lakhs and further, creditworthiness is very subjective issue. The agreement to sell document is not doubted by the Assessing Officer and so the same is to be taken as genuine. Now if Shri Bakhtawar Singh is not able to explain the source of Rs. 15.00 lakhs, the addition cannot be made in the case of the appellant, as the source of Rs. 15.00 lakhs in the hands of the appellant stands explained. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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