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TMI Blog2017 (12) TMI 526X X X X Extracts X X X X X X X X Extracts X X X X ..... , based on the factual position, the addition of ₹ 54,20,000/- made by the AO has been rightly deleted by CIT(A). Hence, we do not find any infirmity in the order passed by the ld. CIT(A) and therefore, we confirm the order passed by the ld. CIT(A). Regarding the addition of ₹ 14,00,000/-, we are of the view that assessee during the assessment proceedings had provided to the AO a copy of the sale bill in respect of the household articles of his father. The AO did not bring on record and cogent evidence to prove that sale bills of household articles are bogus. Based on the factual position, we are of the view that order passed by the CIT(A) does not contain any infirmity. Therefore, we confirm the order passed by the ld. CIT(A). - Decided against revenue Addition under the head of unexplained expenditure - Held that:- AO during the assessment proceedings made his own estimate of what the assessee would have spent but we observe that the assessee had been supported by his son and his father was getting tax free pension which was sufficient to meet the family expenses. Therefore, considering the factual position, we are of the view that the order passed by the CIT(A) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 377; 93,484/- in the head of unexplained expenditure. 4. That under the facts and circumstances of the case ld CIT(A) erred in deleting the addition of ₹ 71,937/- in the head of concealed income earned from security charges. 5. That the appellant craves to add or amend any grounds of appeal on or before the date of hearing. 3. Ground No.1 and Ground No.2 raised by the Revenue relate to addition of ₹ 54,20,000/- on account of unexplained cash credit and ₹ 14,00,000/- on account of unexplained money u/s 69Aof the Income Tax Act, 1961. 3.1 The brief facts qua the issues are that Mr. Devender Jeet Singh Kler, the assessee, is an ex-military person. During the course of scrutiny proceedings for the A.Y. 2009-10, the Assessing Officer added ₹ 54,20,000/-, under section 68 and ₹ 14,00,000/- U/s 69A of the I.T. Act .The assessee had deposited cash of ₹ 54,20,000/- in the savings bank a/c of Indusind bank Khanna and ₹ 19,00,000/- found credited into the S.B A/C No. 018- E04964-010, Indusind Bank, Khanna. When the Assessing Officer asked to explain about the source of cash deposit of ₹ 54,20,000/-, then the assessee explained ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... household goods including silver. An affidavit of the assessee s father was also submitted. However, the ITO noted that in one of the sale deeds for an amount of ₹ 4,12,500/- Shamsher Singh Kler was not described as constituted attorney of the assessee s father. The assessee explained that there was a drafting error in the deed, which was executed by Shamsher Singh Kler in his capacity as constituted attorney. It was submitted that it would be evident from the sale deeds, affidavit of the assessee s father and sale bill relating to household goods including silver submitted to the ITO in course of the assessment proceedings and the aforesaid documents that the assessee s father Hardev Singh Kler was the owner of the agricultural lands which were sold under the four sale deeds all dated September 19, 2008 for an aggregate sum of ₹ 50,02,500/- received in cash. The sale deeds which the consideration amount was duly registered with the registering authority on September 19, 2008. The sale deed for ₹ 4,12,500/- was also in respect of agricultural land bellowing to the assessee s father and was executed by Shamsher Singh Kler as constituted attorney of the assessee s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... articulars of the buyer, was submitted to the ITO in course of the assessment proceedings, and payment was received by cheque. The ld. CIT(A) noted that assessee s father did not file the return of income because agricultural land was exempt from capital gain tax. The assessee retired from the Indian Air Force as a Wing Commander and he was in receipt of pension. He has interest income and a small amount of income from the business of providing security services. The assessee s father Hardev Singh Klerwas a decorated soldier and participated in the Bangladesh war. The assessee s grandfather Chajja Singh was also in the Indian Army, though in the pre-independence era. In fact, the land in question was given by the Government to Chajja Singh in recognition of his service. The CIT(A) noted that this background was important for deciding the matter. The ld. CIT(A) observed that addition of cash credits was open to the authorities only when there was material to show that the assessee carried on an independent business apart from the business on which the assessment was being made. The CIT(A) noted that the assessee resides at Kolkata. The bank account was opened by the assessee on S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... CIT(A) noted that the Additional District Sub-Registrar, Khanna has provided to the Assessing Officer certified copies of the four sale deeds. The Assessing Officer wants to ignore such certified copies because they are typed out on two pages whereas the photocopies submitted by the assessee in course of the assessment proceedings ran into several pages. The photocopies which the assessee had filed in course of the assessment proceedings were of the original deeds typed out on stamp papers with large spaces between each line in order to use up all the stamp papers. The same matter when typed out in single space for issuing certified copy has fitted in one and half pages. Just because the certified copies so typed out were in lesser number of pages than the original documents cannot be a reason to ignore the documents. The Assessing Officer had not pointed out any difference in the contents of the photocopies of the sale deeds submitted at the time of assessment and the certified copies subsequently received from the Additional District Sub-Registrar, Khanna. In fact, the said official had stated in his letter dated June 10, 2013 that the contents of the sale deeds on stamp paper a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rom Harnek Singh. The cheque was for ₹ 19,00,000/- but ₹ 5,00,000/- was returned to him and hence the addition is ₹ 14,00,000/-. The CIT(A) noted that assessee had provided to the Assessing Officer a copy of the sale bill in respect of the household articles of his father. The assessee's father having moved to USA in 2005, wished to dispose of his household articles in India. Since the assessee had gone to Punjab in connection with sale of his father s agricultural land, he used the opportunity to also dispose of his father s household articles. The main reason why the AO did not accept the assessee s explanation was that the assessee s father in his affidavit dated November 16, 2011 did not mention about the return of ₹ 5,00,000/-. He considered the subsequent affidavit dated January 10, 2013 of the assessee s father about the return of ₹ 5,00,000/- as contradicting his previous affidavit dated November 16, 2011. The second affidavit explaining the inadvertent omission in the first affidavit cannot be considered as contradicting the first affidavit. It simply seeks to state a fact which got left out in the first affidavit. Even the AO has added &# ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 907. But there was no information received regarding the said drafting error. The ld DR also pointed out that the Assessee was requested to produce the original purchase deed of such said sold lands but as per the assessee s letter such lands were awarded by British Govt. to his grandfather Mr. Chhajja Singh but the Assessee failed to produce any evidence regarding this award. The assessee should have produced at least the paper of Mutation of land either in the name of his father or in the name of his grandfather because before selling any immovable property 'Mutation' is required. Besides, The DR also pointed out that there was no need to deposit the cash in several days but the assessee did it and it was accepted without supporting any valid reasons. During the assessment proceedings the assessee also did not submit the purchase documents of house hold articles. 3.5 Before us, the ld. counsel for the assessee has submitted the copy of sale deed of agricultural land vide Sale Deed Nos.2956, 2953, 2955, and 2954. The sale deed contains the details of agricultural land and details of the buyers and sellers of the agricultural land. The assessee also submitted the i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee s father for the assessment year 2009-10, cannot result in any taxation in the assessee s hand. Therefore, based on these submissions, the ld. counsel for the assessee prayed that CIT(A) has passed a reasoned order and it should not be interfered by the revenue authorities. 3.6 Regarding the addition of ₹ 14,00,000/- under the head of unexplained money u/s 69A. The Counsel for the assessee has submitted that the assessee had provided to the AO a copy of the sale bill in respect of the household articles of his father. The assessee s father having moved to USA in 2005, wished to dispose of his household articles in India. Since the assessee had gone to Punjab in connection with sale of his father s agricultural land, he used the opportunity to also dispose of his father s household articles. The main reason why the AO did not accept the assessee s explanation was that the assessee s father in his affidavit dated November 16, 2011 did not mention about the return of ₹ 5,00,000/-. He considered the subsequent affidavit dated January 10, 2013 of the assessee s father about the return of ₹ 5,00,000/- as contradicting his previous affidavit dated November 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e order passed by the ld. CIT(A) and therefore, we confirm the order passed by the ld. CIT(A). Regarding the addition of ₹ 14,00,000/-, we are of the view that assessee during the assessment proceedings had provided to the AO a copy of the sale bill in respect of the household articles of his father. The AO did not bring on record and cogent evidence to prove that sale bills of household articles are bogus. Based on the factual position, we are of the view that order passed by the CIT(A) does not contain any infirmity. Therefore, we confirm the order passed by the ld. CIT(A). 3.8 In the result, the appeal filed by the Revenue (in Ground No.1 and 2) are dismissed. 4. Ground No.3 and 4 raised by the Revenue relates to addition of ₹ 93,484/- under the head of unexplained expenditure and addition of ₹ 71,937/- under the head concealed income earned from security charges. 4.1 Brief facts qua the issues are that during the course of scrutiny proceedings the A.O added ₹ 93,484/- u/s 69C on account of unexplained expenditure because assessee made a little drawings for family expenses. Therefore, the AO made the addition,after observing the luxurious li ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aimed by him in earlier years. Regarding securities charges, we note that according to the assessee, the profit and loss account of M/s Tornado shows security service charges received of ₹ 1,62,536/- and payment to security personnel was shown as ₹ 65,364/-. During the assessment proceedings, the assessee explained to the AO that the assessee had actually received ₹ 2,34,473/- on account of security service charges and had paid ₹ 1,37,301/- to the security personnel who had provided the security services. It was explained that the Accountant had debited payment to the extent of ₹ 71,937/- made to the security personnel to the account relating to security service charges received. The result was that the security service charges received got netted off to the extent of ₹ 71,937/- but such netting off did not have any effect on the income. If the security service charges of ₹ 1,62,536/- shown in the profit and loss account were increased by ₹ 71,937/-, the payment made to security personnel shown as expenditure in the profit and loss account would also have to be increased by the like amount. The AO, however, treated the sum of ͅ ..... X X X X Extracts X X X X X X X X Extracts X X X X
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