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TMI Blog2020 (3) TMI 547X X X X Extracts X X X X X X X X Extracts X X X X ..... ry evidence of third parties for considering the sale consideration of Rs. 2,71,00,000/- and ignoring the detailed order DIG (Stamps) dtd. 22-6-16. The Competent Authority has also considered such photo stat copy of agreement and treated such complaints as fake and passed his order that no such agreement was made for consideration of Rs. 2,71,00,000/-. 3. That as asked by Pr. CIT to make detailed enquiry and to make addition of deposit which were already explained. The payment received from Kailash was paid by cheque and it was sufficient proof and accordingly accepted by AO after source thereof. 4. That the order passed u/s 263 is bad in law. It is also time barred from date of original due date of return filed for Nil tax liability for 07-08-09 also. 5. That as decided by Supreme Court in (2007) 211 CTR page 69 (SC) there is distinction between lack of enquiry and inadequate enquiry. As held by Supreme Court if there is an enquiry even inadequacy. As held by Supreme Court if there is an enquiry even inadequate that would not by itself given occasion to the Pro CIT to pass an order u/s 263 of IT Act merely because he has a different opinion in the matter. 6. That the detai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Total Rs. 1500198 3. However, the AO failed to make enquiries with reference to the explanation offered as is evidenced in the assessment order. You tried to explain the source from following:- i) Vehicle sold to Sukh Ram Rs. 700000 ii) Vehicle sold to Sheo Ram Rs. 600000 iii) Vehicle sold to Pusa Ram Rs. 400000 iv) Plot sold to various parties Rs. 119000 v) Agriculture income Rs. 252000 vi) Received from Hari Ram Rs. 200000 vii) Funds from operations Rs. 480000 viii) Amount routed through Kailash paid Rs. 600000 on 6-1-2009 Rs. 600000 4. The AO failed to inquire into the dates of these transactions to explain the cash deposits. Further, Shri Pusa Ram and Shri Sukh Ram had not agreed to the claim of assessee that they have purchased such vehicles leave aside in cash. In fact the statement of Shri Pusa Ram was on Oath and in the presence of Shri Vimal Chauhan A/R. The statement of Shri Sukh Ram too was on oath. The important part of these statements was that they were made aware of the version of Shri Balu Ram Jat in question No. 6 of both the statement denying purchase as well as payment in cash. Shri Sheo Ram was not available as per ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to the aforesaid extent for making afresh assessment after carrying out enquiries in the manner as above and after giving opportunity to the assessee. In the aforesaid factual background, the present appeal has been filed by the assessee against the said order of ld. Pr. CIT, Ajmer passed u/s 263 of the Act. 6. During the course of hearing, the ld. AR submitted that for invoking provisions of section 263, the condition precedent is that assessment order passed by A.O. is erroneous and prejudicial to the interest of Revenue i.e. both conditions must co-exist. In the case of assessee, the order is neither erroneous nor prejudicial to the interest of Revenue. 7. It was submitted that the assessee in reply to show cause notice issued by ld. Pr. CIT explained that sums paid to him by Shri Sukhram and Shri Pusaram in cash was confirmed by them by filing affidavits. Further the said cash transactions with the said persons have been accepted by Ld. AO after due verification of the facts. Accordingly the assessee explained the sources of cash deposits made in his bank account and the same are accepted by Ld. AO after application of his mind and evidences submitted before him. As such it ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aid amounts Rs. 63 has already been declared in return of income and balance sum Rs. 158/- has been added by the Ld. AO in the assessment order. Thus the above said observation of the Ld. Pr.CIT that in place of Rs. 2,21,00,000 the Ld. AO has added only Rs. 221/- is wrong, without any basis and against the true facts of the case as evident from record. In view of the above facts duly supported by legal documentary evidences that no agreement was executed by the assessee for a sum of Rs. 27100000 as alleged by the Ld. Pr. CIT in his order. Further as evident from the impugned order passed u/s 263 that The Pr. CIT did not held that contention of assessee is not correct in law but only held that Ld. A.O. erred in accepting the claim without any enquiry or verification which should have been made. 9. It was further submitted that it is evident that Ld. A.O. made enquiries on the issue and assessee complied to the enquiries and filed all the required details. Thus it is not a case where that A.O. made no enquiry or verification which should have been made. It is clear from reading of notice u/s 263 of the Act, 1961 that the proceedings u/s 263 has been started on the same issue which ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of revenue. In view of the above judicial pronouncements and various other judgements on the issue the assessment order passed by A.O. cannot be treated as an erroneous and prejudicial to the interest of revenue. In the case of CIT Vs. Vodafone Essar South Ltd. (2013) 2012 Taxman 184, the Hon'ble Delhi High Court held that assessing officer before passing assessment order made an enquiry and directed his mind on all aspects. View adopted by him was clearly one among two plausible views that could have been taken. Commissioner did not specifically furnish any reasons to say why original order was unsupportable in law. Commissioner could not have validity exercised his revisionary power u/s 263 in instant case. 10. It was further submitted that the order is not prejudicial to revenue as A.O. was correct in law and on the facts of the case. Thus the Ld. Pr. CIT is wrong in holding that A.O. did not make any enquiry or verification so as to invoke jurisdiction u/s 263. Even newly inserted Explanation 2 (a) to section 263 does not authorize or give unfettered powers to the Commissioner to revise each and every order, if in his opinion, same has been passed without making enquiries ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... inable in view of affidavit given on Oath duly notarized. As admitted Shri Sheoram was not made available to Inspector on 16-11-2016 but later on appeared and admitted the purchases of Tractor, Trolley, machine, jilan/pilan plough etc. As Shevram appeared before AO, it was not our duty to ask AO to make an investigation that when affidavit filed by Pusaram and Sujhram both, the denial made later on 18-11-2016, the action should have been taken by you against his affidavit given on Oath which is more Valuable documents as against denial of parties under undue influence in their statement taken under undue influence because cleared from their written submission on 27-12-2016 on a plain letter. The 5 cheques deposit clearly shown in Bank account and deposit of all the five cheques mentioned in Bank statement. 13. It was further submitted that similarly with regards to investment of Rs. 27100000/- we are to submit that no such investment made by any agreement. The fake complaints filed before the DIG Registration and Stamps on the basis of above alleged Ikrarnama for sale. On receipt of said complaint the DIG Registration and Stamps directed to Sub-Registrar, Kishangarh to Investigate ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . CIT was wrong, bad in law and without jurisdiction. The impugned order u/s 263 passed by Pr. CIT thus deserves to be cancelled/set aside. 17. Per contra, the ld. DR is heard who has submitted that the AO has failed to go into the enquiries with reference to failure of assessee to prove the veracity of the explanation offered for bank deposits, with the help of any documentary evidence. The assessee had not been able to controvert the finding that in their statements recorded on oath, Shri Pusa Ram and Shri Sukh Ram had not agreed to the claim of the assessee that they have purchased the vehicles in cash, specially when they were made aware of the version of Shri Balu Ram Jat in Question No. 6 of both the statements where in AO failed to enquire. Moreover, no date about purchase and sale of vehicle has been mentioned in the plain letter which is must to explain the deposit made on a particular date, which thus has no evidentiary value, furnished by Shri Pusa Ram on 27.12.2016. Similarly, Shri Sukh Ram denied on oath on 18.11.2016 but furnished notarized copy without specifying any date of receipt of vehicle as in the absence of dates, the date wise deposit cannot be held explain ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (the seller). On the basis of available copy of Ikrarnama, it is found that the assessee Shri Balu Ram Jast along with partner Shri Radhey Shyam Yadav (R/o Gogawas, Tehsil - Dantaramgarh) entered into Ikrarnama of purchase of property bearing Khasra No. 96 and measuring 06 bighas 8 biswas for a total consideration of Rs. 2.71 crores with M/s.Sterling Build Estate Pvt.Ltd. on 01-10-2008. As per available copy of Ikrarnama (which is duly notarized on 2/10/2008 by Notary Public Shri Ramesh Chand Sharma, Kishangarh) a sum of Rs. 50,00,000/- (fifty lacs only) has been claimed to be paid in cash by the purchasers on 1/10/2008 itself i.e. at the time of execution of Ikrarnama. As per Ikrarnama, the remaining amounts were claimed to be paid by cheque of Shri Balu Ram Jat bearing Nos. 213745 to 213749 of SBBJ, Madanganj Kishangarh. However, the cheques bearing Nos 213745 to 213749 were not cleared from the accounts of Shri Balu Ram Jat. Finally the property was transferred through following four sale deeds:- Sale value and mode of payment Seller Purchaser Details of land Rs. 1400000/- through cheque No.213758 dated 6/1/2009 of SBBJ, Madangarnaj. This cheque has been cleared on 30/1/ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rnama for the A.Y. 2009-2010. The perusal of bank account No. 51084340304 with SBBJ, Madanganj of Shri Balu Ram reflects transactions of certain deposits in cash on different dates during the period relevant to the A.Y. 2009-2010 which are reflected as under:- Date Amount 23/09/2008 Rs. 15000 12/01/2009 Rs. 41000 27/01/2009 Rs. 450000 30/1/2009 Rs. 1110000 31/01/2009 Rs. 300000 02/02/2009 Rs. 200000 07/02/2009 Rs. 800000 9/02/2009 Rs. 446000 9/02/2009 Rs. 145000 13/02/2009 Rs. 1500 9/3/2009 Rs. 1500 Total Rs. 3510000 The assessee has filed his return of income for the A.Y.2007-2008 and 2008-2009 declaring total taxable income of Rs. 204000 and Rs. 180500 respectively. Return of income for the A.Y. 2009-2010 has not been filed and thus, with meager incomes in the earlier years, the assessee had no sources to deposits cash woth Rs. 3510000 in his bank account as cash. The payments for purchase of the land referred above in the names of family members have been made through this account amounting to Rs. 2800000 (Rs. 1400000 + Rs. 1400000). "The perusal of Ikrarnama reflects that the other purchaser alongwith Shri Balu Ram Jat was Shri Radhe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... his report to DIG Stamps. The Collector, Stamps, Kishangarh has thereafter passed the order vide case No. 516/2011 namely Sub-Registrar Kishangarh vs. Baluram Jat dated 22- 06-2016 and in the said order, the above said agreement shown in the name of assessee has been found to be fake. It was accordingly submitted that no such alleged agreement was made for Rs. 271,00,000/-. The AO therefore examined this particular matter in detail and has also written a letter dated 14.12.2016 to DIG Registration and Stamps who has in turn replied to the AO vide his letter no. 10185 dated 14.12.2016 and the contents thereof reads as under:- 22. Further, our reference was drawn to findings in the order passed by the Collector, Stamps, kishangarh in case of Sub-Registrar Kishangarh vs. Baluram Jat (Case no. 516/2011 dated 22-06-2016) which read as under:- 23. It was further submitted that after taking into consideration the above facts and carrying out necessary verification including directly communicating with the concerned authorities, the AO has recorded his findings in the assessment order dated 30.12.2016 which reads as under:- "As per information available with the department, the assesse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the A.Y. 2009-10 on 31.03.2010 declaring income at Rs. NIL. Later on, as per information available with the department, the assessee has executed an lkrarnama with Sh. Balu Ram Jat S/o Shri Ghasiram & Sh. Radhey Shyam Yadav S/o Bholaram Yadav for sale of agriculture land measuring 6 bigha 5.70 biswas Khasara situated at No.96, Mandaganj, Kishangarh (Ajmer) on 01.10.2008. As per Ikrarnarna, the actual sale consideration was Rs. 2,71,00,000/- (Rupees Two Crore and Seventy One Lakhs) which includes cash of Rs. 50 lakhs and Rs. 221 lakhs received through post dated cheques serial No. 213745-213749. This Ikrarnama was duly signed by buyer, seller and witness and was also notarized. 2. Further, it has came to notice that the assessee has not disclosed sale consideration of Rs. 2,71,00,000/- in its return of income. Therefore, notice u/s 148 was issued on 06.10.2015 after obtaining prior approval of the Pr. Commissioner of Income Tax-1, Jaipur. The notice was duly served upon the assessee on 06.10.2015. The A/R of the assessee has filed his written submission on 06.11.2015 alongwith revised return of income e- filed on 04.11.2015 in response to notice issued u/s 148 of the Act declaring ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... proceedings, the matter was examined by the Assessing officer wherein the assessee submitted that no such agreement was entered into and even a complaint has been lodged with the Stamp authorities regarding evasion of stamp duty and on investigation, an order dated 22.06.2016 has been passed by Collector (Stamps) wherein the said agreement was found to be fake. A copy of said order dated 22.06.2016 was filed before the Assessing officer and in turn, the Assessing officer also enquired from DIG stamps about the veracity of such assertion made by the assessee and passing of such an order which was duly confirmed by the DIG Stamps. The Assessing officer has thereafter recording a specific finding in the assessment order which reads as under: "During the course of assessment proceedings, it is noticed that the Sub registrar, Kishangarh has made a reference to the Collector (Stamps), Ajmer on the basis of agreement as discussed above. The Collector (Stamps), Ajmer has passed order in case no. 516/2011 dated 22/06/2016 by quashing the reference made by the Sub-Registrar, Kishangarh and Notary public has also denied to notarized the same." We therefore find that the Assessing officer h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s 147 and thereafter, during the course of assessment proceedings, the matter was examined by the Assessing officer wherein the assessee was asked to explain the source of such deposits, further statement of the person whom the assessee claim to have received the amount were also recorded and these persons also filed affidavits before the Assessing officer. Taking all these explanation and documentation into consideration, the Assessing officer has recorded his findings in the assessment order which reads as under:- "Further, the assessee was asked to explain sources of these cash deposits in his bank accounts. In compliance, the assessee has submitted that he has deposited Rs. 35,10,000/- in cash and the remaining amount of Rs. 15,00,198/- through cheques. The deposits made through cheques have been verified from the details, evidences etc. as submitted by the AIR of the assessee during the course of assessment proceedings on test check basis. Further, during the course of assessment proceedings, the assessee on 26/10/15 has furnished evidences explain sources of cash deposits in the bank account as under:- a. Vehicle sold to Sukh Ram Rs. 7,00,000 b. Vehicle sold to Sh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e matter have not been spelt out by the ld CIT when the explanation of the assessee, the statements and affidavits of the person from whom the assessee claims to have received the money is on record. In such a situation, where enquiries have already been made by the AO and all material is on record, the ld CIT should come with a definite finding instead of remanding the matter to the Assessing officer for fresh adjudication. In this regard, we refer to the decision of the Coordinate Bench in case of M/s Dangayach Hotels (P) ltd vs Pr. CIT (ITA No. 290/JP/2017 dated 4.09.2017) wherein the relevant findings read as under:- "We would like to state that once necessaries enquiries are conducted and the claim of assessee is found in accordance with law and also not in violation of Board Circulars/ instructions and the AO adopted a plausible view permissible in law then such view cannot be overruled by taking recourse of section 263 of the Act. The ld. Pr.CIT should have shown that the view taken by the AO is unsustainable in law. Simply expressing the view that the AO should have conducted enquiries in a particular manner as desired by him then such course of action of ld. Pr. CIT is n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ise of jurisdiction under section 263 of the Act. In such matters, to remand the matter/ issue to the Assessing Officer would imply and mean the Commissioner of Income Tax has not examined and decided whether or not the order is erroneous but has directed the Assessing Officer to decide the aspect/question.'' We would also like to state that this explanation cannot override the interpretation provided by the Hon'ble Delhi High Court and if that be the case then the ld. Pr. CIT can find fault with each and every assessment without conducting any enquiries or verification in order to establish that the assessment order is not sustainable in law and order for revision. We would also like to state that the ld. Pr. CIT can force the AO to conduct the enquiries in the manner preferred by him then it will be prejudiced to the independent application of mind by the AO and definitely that could not be intention of the legislature in inserting Explanation 2 to section 263 of the Act. Such interpretation would lead to unending litigations and there would not be any point of finality in the legal proceedings. The Hon'ble Supreme Court in the case of Parshuram Pottery Works Co. Ltd vs ITO (19 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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