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TMI Blog2014 (2) TMI 655X X X X Extracts X X X X X X X X Extracts X X X X ..... g the additions made by the AO – thus, the order of the CIT(A) set aside – Decided in favour of Revenue. - I.T.A. No.286(Asr)/2012 - - - Dated:- 14-2-2014 - Sh. H. S. Sidhu And Sh. B. P. Jain,JJ. For the Appellant : Sh. Mahavir Singh, DR For the Respondent : Sh. Surinder Mahajan, CA ORDER Per Bench : This appeal of the Revenue arises from the order of the CIT(A), Jalandhar dated 16.04.2012 for the assessment year 2007-08. The Revenue has raised following grounds of appeal: 1. That the order of the ld. CIT(A) is against the law and facts of the case. 2. That the Ld. CIT(A)-1, Ludhiana has erred in law and facts in deleting addition of Rs.20,00,000/- as under: i) There is no evidence that the agreement was cancelled as no agreement for cancellation was filed with the AO or with CIT(A) in the proceedings before it. ii) There is no receipt produced of any cash having back returned on the cancellation of the agreement with Sh. Sandeep Kumar. iii) No evidence in support of above two claims was found or seized during the search proceedings. 3. The Ld. CIT(A) has erred in deleting the addition of Rs.20 lac by accepting assessee s explanation that amoun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lakh. It is relevant to note that a cash payment of Rs.10 lakh has been made alongside a cheque payment for giving advance of Rs. 15 lakh to Sh. Hitesh Kumar S/o Sh. N.K.Aggarwal. The property for which the advance of Rs. 15 lakh was paid is located at village Malko, Tehsil Jalandhar and its area is 51 Marlas 159 Sq. ft. 4.3. Regarding source of Rs.10 lakh cash paid on 24.07.2006, no documentary evidence or explanation of the source whatsoever has been furnished by the assessee during the course of search seizure proceedings. 4.4. Therefore, this amount of Rs.10 lakh is being treated as unexplained investment in the hand of the assessee. 4.5. Further, in 2nd agreement the property of 51 marlas 159 sq. ft. at village Malko was to be sold by the assessee to Sh. Sandeep Kumar son of Sh. Om Parkash, Raja Garden, Mithapur Road, Jalandhar. and received an advance of Rs.20,00,000 from Sh. Sandeep Kumar on 29.09.2006. 4.6. The assessee has submitted that this agreement was cancelled and the advance was forfeited. 4.7. Therefore, it is seen that the assessee earned Rs.20 lac as income from forfeited advance. The same is being added as undisclosed income of the assessee. 4.8. F ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gly so that on the cancellation of deal, the advance received was forfeited. He further endeavoured to strengthen this wrong inference by making a specific mention in para 4.8 of his order, that this forfeited amount of Rs.20 lacs was further utilized by assessee in the purchase of property i.e. 749C, GTB Nagar, Jalandhar on 29.9.2006 and thus the subsequent investment did not warrant any adverse view. Having inferred so, the AO went ahead with effortless ease to make the impugned addition of Rs.20 lacs. The above findings of the AO to say the least, are again not consistent with the facts and material placed on record before him. The assessee in the chart referred to above had mentioned that the deal was cancelled and amount returned. In the same chart, the investment in property at GTB Nagar, was also explained to have been made out of advance received from Sandeep Kumar against property at Vill. Malko. What escaped the marvel eye of the AO was that the cancellation of Malko property deal had not taken place during the year under appeal. It was stated to be the present status as could be related to the period when the reply was filed. The assessee s reply that amount was return ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in cash and Rs. 5 lacs in cheque. The sequence of events makes it quite clear that assessee s claim of returning the amount of Rs. 20 lacs is logical and the AO had no basis to wrongly attribute forfeiture of this amount on the part of the assessee. The remand report clearly brings on record this fact that the AO had concluded forfeiture only on the basis of presumption and attributed the same to the assessee s submissions. In the circumstances the addition made by the AO is directed to be deleted. 4. The Ld. JCIT(DR), Mr. Mahavir Singh, argued that the assessee received an advance of Rs. 20 lacs from Sh. Sandeep Kumar on 29.09.2006. As per 4.6 of AO s order, there was submission of the assessee that this agreement was cancelled and the advance was forfeited and accordingly the AO made an addition of Rs. 20 lacs as income of the amount of advance forfeited as undisclosed income of the assessee. The Ld. JCIT (DR), Mr. Mahavir Singh further argued that it is the said amount forfeited amounting to Rs.20 lacs which has been considered as source for payment made against the agreement to purchase property at 749-C, GTB Nagar, measuring 10 marlas and 45 sq. ft and accordingly the said ..... X X X X Extracts X X X X X X X X Extracts X X X X
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