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TMI Blog2023 (6) TMI 1020X X X X Extracts X X X X X X X X Extracts X X X X ..... only where it is determined that such an agreement to sell is enforceable in hands of both the parties and/or the parties have actually taken certain steps to enforce their respective rights emanating from such agreement to sell, the same can act as a relevant and credible evidence in support of the explanation of the assessee. As no explanation of the assessee in this regard is given it would be appropriate that the matter is set-aside to the file of the AO to examine the same after providing reasonable opportunity to the assessee - Ground of assessee allowed for statistical purposes. - ITA No. 1331/Chd/2019 - - - Dated:- 15-5-2023 - SHRI. VIKRAM SINGH YADAV, AM For the Assessee : Shri Gaurav Sharma, CA For the Revenue : Smt. Amanpreet Kaur, Sr. DR ORDER Per Vikram Singh Yadav, AM This is an appeal filed by the assessee against the order of the Ld. CIT(A)- 3, Ludhiana wherein the assessee has taken the following grounds of appeal: 1. That on the facts and the circumstances of the case, the Order of Learned CIT is bad in law. 2. That the Learned Commissioner of Income Tax has erred in validating the reopening of the case of the Appellant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... itted an Affidavit from 4.2. one of the witnesses of the said Agreement to Sell affirming the details mentioned in the above said Agreement to Sell. During the course of assessment proceedings, the buyer Mr. Kuldeep Singh also sent his Affidavit to the AO directly through speed post affirming the details mentioned in the Agreement to Sell. However the AO decided that the Agreement to Sell was not proper and made an addition of Rs. 43,15,000/-. 4.3. Regarding the findings of the AO that the Agreement to Sell is on a plain paper and not on any Stamp Paper and the same had not been even registered with the Competent Authority, it was submitted that the Indian Contract Act, 1872 does not make stamping and registration of the Agreement compulsory, nor does it deem an unstamped or unregistered Agreement / Contract invalid and unenforceable and even if they are not stamped or registered, even then they will still be enforceable against the parties who have signed the same. 4.4. It was submitted that the Indian Contract Act, 1872 provides that all Agreements that fulfill the essential conditions of free consent, lawful consideration and lawful object are valid and enforceable and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Counsel of the assessee admitting that he made the mistake mentioning two shops instead of one is also placed on record and the assessee should not be penalized for the mistake committed by the Counsel of the assessee. 4.9. It was submitted that in any case, the mistake in the Affidavit cannot be taken to have superseded the Agreement to Sell. As the Agreement to Sell is the main evidence and the spirit of the Affidavit of the Parties to the above said Agreement are the most important evidence to confirm the facts of the above said Agreement. 4.10. It was further submitted that the Affidavit of the buyer was sent directly through the speed post and the AO has only found one mistake of mentioning of two shops as against one shop and the source of cash paid by Mr. Kuldeep Singh was never questioned by the Ld. A.O. 4.11. Regarding the findings of the AO and the Ld. CIT(A) that the Stamp Paper was purchased by Mr. Naveen Goyal on 24/12/2018 whereas the Affidavit has been signed on 18/12/2018 which is quite impossible, it was submitted that the contents of the Affidavit of Mr. Naveen Goyal were provided by the Counsel of the assessee electronically on 18/12/2018 and therefore t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1, 744/7/2, hadbast no. 161, area karabara tehsil, Ludhiana locality Bharat Nagar to Bus Stand Road, Ludhiana. 5.2. As per the agreement, the assessee has received Rs. 45,00,000/- as advance money on 01.03.2010 and the balance amount of Rs. 5,00,000/- at the time of registration of sale deed. During the course of assessment proceedings, the AR of the assessee has filed affidavit of Sh. Naveen Goyal who has claimed to be the witness of the agreement to sell of the property. Another affidavit of Sh. Kuldeep Singh S/o Sh. Puran Singh R/o VPO Threekay Ludhiana was received through speed post who has claimed to be the buyer as per agreement to sell. While finalizing the assessment, the Assessing Officer has duly considered all the replies and submissions made by the assessee and clearly held that the assessee has made a concocted story with a view to conceal the fact that the amount of Rs. 43,87,272/- recorded in his books of account is his own unexplained cash. 5.3. In view of the findings of the Assessing Officer, it is incorrect to assert that the addition made by the Assessing Officer on account of unexplained investment u/s 69 of the I.T. Act, 1961 are wrong. On perusal of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he assessee has filed an affidavit given by someone Sh. Naveen Goyal who has been claimed by the assessee as a witness of the agreement to sell. Second affidavit has been received by speed post vide consignment no.EP498978704IN which has been posted from head post office, Ludhiana by someone Sh. Kuldeep Singh who has claimed by the assessee to be the purchaser in lieu of agreement to sell. From the perusal of agreement of sell and both the above mentioned affidavit, the following facts have been noticed : i. As per the agreement to sell, the agreement has been executed for sale of one shop measuring 100 sq. yard out of area 563.11 sq. yard property No.B- 18/3726 and 3726/1, khasra no.744/ 7/1, 744/7/2, hadbast no. 161, area karabara tehsil, Ludhiana locality Bharat Nagar to Bus Stand Road, Ludhiana. The agreement to sell is written on a plane white paper. It has not been written on stamp paper nor it has been got registered with competent authority. ii. Whereas, as per both the affidavits agreement to sell was executed for sale of two shops measuring 100 sq. yards. Further, the property number and khasra number has not been mentioned in the affidavits. iii. It is no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was written on white plain paper. It was not registered with any competent authority and it was not written on stamp paper. The assessee was asked to furnish his books of accounts, copy of sale deed in continuation of this agreement and other financial details. However during the assessment proceedings the Assessing Officer vide paragraph 5 onwards, of the assessment order has mentioned, that the assessee has completely failed to file the details and explanation in support of his claim of receipt of huge opening cash in hand. 5.11. The Ld. CIT(A) has further given findings on the issue under discussion in Para 5.4 at page 16 which is reproduced herewith for your kind reference : - 5.4 After carefully considering the assessee's submission filed the time of appellate proceedings and I do not find myself in agreement with the assessee's contention. The assessee has merely reiterated almost same arguments even at the time of assessment proceedings. It is also seen that at the time of assessment proceedings the assessee had been given ample opportunities to furnish necessary evidence, however the assessee has failed completely to furnish the same. The Assessing Officer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... him. During the course of reassessment proceedings proper time was given to the assessee to submit the necessary documents and evidences to verify the financial transaction but the assessee failed to file genuine documentary evidence regarding the same. Assessee has failed to discharge the onus cast upon him by the Assessing Officer on account of documentary evidences regarding the unexplained investment u/s 69 of the I.T. Act, 1961 in purchase of trees/timber from GLADA. 5.13. In view of the foregoing discussion, it was submitted that the order of the Assessing Officer and the Ld. Commissioner of Income Tax (Appeals) may be sustained. 6. Heard the rival contentions and perused the material available on record. The assessee, in support of his explanation for explaining the source of making cash payment to GLADA, has submitted a copy of agreement to sell dated 01/03/2010 and in terms of contents thereof, it talks about sale of a shop measuring 100 sq. yard out of area 563.11 sq. yard property No.B-18/326/1, khasra no. 744/7/1, 744/7/2, hadbast no. 161, area karabara tehsil, Ludhiana locality Bharat Nagar to Bus Stand Road, Ludhiana for a total consideration of Rs. 50,00,000/- ..... X X X X Extracts X X X X X X X X Extracts X X X X
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