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TMI Blog2023 (7) TMI 669X X X X Extracts X X X X X X X X Extracts X X X X ..... - We are unable to see any ambiguity, perversity or any other valid reason to interfere with the findings arrived by the Ld. CIT(A) Assessment u/s 153A - Addition u/s. 69C - unexplained expenditure - Addition relying on loose papers - HELD THAT:- We are in agreement with the conclusion drawn by the CIT(A) that the impugned loose papers and documents were found seized from the premises of third party. Therefore, presumption u/s. 292C of the Act will apply to said searched entity, i.e. third party only and not to the assessee enabling the AO to make addition in the hands of assessee in the assessment order passed u/s. 153A/143(3) of the Act. Our conclusion also gets support from the order of ITAT Delhi Bench in the case of Trilok Chand Chaudhary [ 2019 (9) TMI 95 - ITAT DELHI] Disallowance of over draft interest claimed - HELD THAT:- Undisputedly the appellant from the partnership firm to whom loans were provided has earned remuneration/salary income which has been duly shown in the return filed by the appellant which was accepted by the AO along with tax thereon. Under identical facts and circumstances in the case of Sudhir Dattaram Patil [ 2004 (12) TMI 625 - ITAT ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee requested to call upon the seller to explain the situation but the summon issued u/s. 131 of the Act to the seller was served and the replied in writing to dak of the AO. Merely because the seller was not present in person before the AO, the assessee cannot be alleged to have made any unexplained investment which could entitle the AO to make addition u/s. 69B of the Act. Therefore the Ld. CIT(A) was right in deleting the addition on this issue. - ITA No.87/Ind/2021 - - - Dated:- 9-5-2023 - SHRI CHANDRA MOHAN GARG, JUDICIAL MEMBER AND SHRI BHAGIRATH MAL BIYANI, ACCOUNTANT MEMBER For the Appellant : Shri P.K. Mishra, CIT(DR) For the Respondent : Shri S. S. Deshpande, CA and Shri Satyajeet Chatterjee, CA ORDER PER CHANDRA MOHAN GARG, J.M. This appeal filed by the Revenue is directed against the order dated 14.08.2020 of the Ld. CIT(A), Bhopal, relating to Assessment Year 2012-13. 2. The grounds of appeal raised by the revenue read as under:- 1. On the facts and in the circumstances of the case, the Id. CIT(A) erred in deleting the addition of Rs. 6,50,00,000/- made by the Assessing officer on account of voluntary surrender u/s 132(4) of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bmitted that the AO has made addition which was not sustainable on the basis of surmises of conjectures which was rightly deleted by the Ld. CIT(A). The learned counsel drawing our attention towards relevant part of the first appellate order submitted that during the course of search proceedings the assessee submitted brief details and declared Rs. 4 crores has work in progress in Sagar Premium Towers, Rs. 1 crore advance given to the parties and Rs. 90 lakh was cash kept at side Sagar Premium Towers and Rs. 85 lakh kept at side at Sagar Landmark. The learned counsel further explained that besides that above Rs. 6.75 crore declaration the assessee made miscellaneous surrender of Rs. 10.50 crore and it was submitted that the same shall be confirmed after study of all loose papers. 5. The learned counsel further submitted that subsequently after filing of return u/s. 153A of the Act, assessee did not find any investment linking with said remaining of amount of Rs. 10.50 crores but however just to by piece of mind and reduced the litigation the assessee shown Rs. 4 crores in his tax return and return of his wife under income from other sources. The learned counsel submitted that th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... statements nor was able to consult his tax advisor therefore the assessee in all fairness kept open the heads of declared amount and after considering the entire facts and circumstances surrendered amount of Rs. 10.75 crores and also paid tax thereon. Therefore, remaining amount of Rs. 6.50 crore was rightly deleted by the Ld. CIT(A) having no substance and without support of any adverse material. 9. On careful consideration of above submissions first of all we note that the AO made addition on the basis of statement recorded by the Investigation Wing during the course of search and seizure operation on 22.02.2011 and 15.11.2011 of assessee Shri Sanjeev Agrawal and subsequently, vide letter dated 23.04.2012 he again confirmed the said surrender. The said letter dated 23.04.2012 has also been reproduced by the AO in para 13.3 at page no.9 and 10 of the assessment order. 10. However, at the time of filing return of assessee, his wife and other related concern the assessee including amount of Rs. 05.75 crore in the name of M/s. Agrawal Constructions towards projects namely; Sagar Premium Towers (work in progress to parties) Sagar Landmark of Rs. 3 crore in his own account and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... M/s Agrawal Constructions (AARFA9981D) 5,75,00,000 Disclosed in the return of income accepted in the assessment Mr. Sanieev Agrawal (ADHPA8387N) 3,00,00,000 Disclosed in the return of income but in assessment enhanced by Rs. 6.50 cores. Mrs. Kiran Agrawal (AASPA9452C) 2,00,00,000 Disclosed in the return of income accepted in the assessment Total Amount Rs. 10,75,00,000 The appellant on ad-hoc made voluntary surrender of Rs. 17.25 crores which was reduced to Rs. 10.75 crores and the balance amount of Rs. 6.50 crores was retracted. The appellant has strongly contended that no corroborative evidence on record to corroborate the conclusion of the AO, the assessee had earned income from undisclosed sources at Rs. 6.50 crores over and above Rs. 3.00 crores disclosed in the return. 4.5.2 I have considered the facts of the case, plea of the appellant, case laws relied upon by the appellant and AO and findings of the AO. During the asse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Thus, it can be safely concluded that the addition made by the A.O was not on the basis of the incriminating material found during the course of search but only on the basis of statement of appellant only. Even in post search enquiries no irregularity has been brought on record and the only addition made is towards income declared in the statement recorded us 132(4). Hon'ble ITAT Indore in the case of ACIT(1) vs. Sudeep Maheshwari ITA No 524/Ind/2013 dated 13.02.2019 has held as under:- 6. It is the case of the assessee that during the course of search seizure, no incriminating material or undisclosed income or investments were found. It is stated that the assessee was under mental pressure and tired. Therefore, to buy peace of mind, he accepted and declared Rs.3 crores in personal name. It is also stated that the case laws as relied by the A.O. are not applicable on the facts of the present case. The assessee has relied on the decision of the Hon'ble Supreme Court rendered in the case of Pullangode Rubber Produce Co. Ltd. 91 ITR 18 (SC), wherein the Hon'ble Court has held that admission cannot be said that it is conclusive. Retraction from admission was permiss ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... easons given in the case of Kailashben Manharlal Chokshi (supra). 5. It appears from the statement of facts that there was a search in the business premises of the petitioner's firm as well as in the residential premises of its partner, Shri Sheo Kumar Kejriwal, on 24th September, 1987. During the course of search, the statement of Shri Sheo Kumar Kejriwal had been recorded under section 132(4) of the Income Tax Act and in the statement, he stated that he was partner in the Ganesh Trading Company, ie. the present assessee-firm in his individual status and that he surrendered Rs. 20 lacs for the assessment year 1988-89 as income, on which tax would be paid. He further stated that other partners would agree to the same; otherwise it would be his personal liability. However, in the returns filed after search, the income of Rs. 20 lacs surrendered by Shri Sheo Kumar Kejriwal was not declared by the assessee-firm. On being asked to explain the reason for not showing the surrendered amount in the returns, it was submitted by the assessee that declaration made by the partner was misconceived and divorced from real facts. It was contended that the declaration was made after persua ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e declaration of undisclosed income of Rs. 20 lacs. Mere reading of statement of assessee is not the assessment of evidentiary value of the evidence when such statement is self-incriminating. Therefore, we are of the considered opinion that in the present case, a wrong inference had been drawn by the authorities below in holding that there was undisclosed income to the tune of Rs. 20 lacs. 7. In view of the above reasons, without answering the question about retrospective operation of the proviso to section 134(4), we are holding that the authorities below have committed error of law in drawing inference from the materials placed on record, ie. admission of the assessee coupled with its retraction by the assessee. The Revenue may now proceed accordingly 4.5.6 Further, Hon'ble ITAT in the case of Ms Ultimate Builders vs ACIT Central-Il, Bhopal ITA No 134/Ind/2019 dated 09.08.2019, wherein it has been held that the statement given by the assessee was without any specific reference to any incriminating material therefore, addition on account of undisclosed income offered in statement was deleted. Besides this, decision of Hon'ble Gujarat High Court in the case off K ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the case of CIT v. Chandra Kumar Jethmal Kochar, (2015) 230 Taxman 78 (Guj), Asstt. CIT v. Kunwarjeet Finance Pvt. Limited, (2015) 61 Taxmann.com 52 (Ahm.-Trib.), CIT v. Jagdish Narayan Ratan Kumar, (2015) 61 taxmann.com 173 (Raj, wherein it was held that when addition of disclosure made by the assessee in statement recorded w/s 132(4), it cannot be sustained despite retraction, when Revenue could not furnish any positive evidence in support of such addition. Therefore, we are unable to uphold the findings of the A0 and inclined to agree with Ld. CIT(A). Further, the Hon'ble Rajasthan High Court in the case of Jagdish Narayan Ratan Kumar (supra) has held that statement made during search must be correlated with records, which are found and if there is no ambiguity, explanation given by the assessee should be taken into consideration before making assessment. Thus, based on these decisions, we are of the opinion that the addition made by merely based on statement ws 132(4) without linking to the seized books of accounts. other documents, money, bullion, jewellery, other valuable articles or things is not sustainable in law 4.5.9 In view of the above discussion facts state ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ble Jharkhand High Court in the case of Shri Ganesh Trading Company vs. CIT(supra) held that mere reading of statement of assessee is not the assessment of evidentiary value of the evidence well such statement is self incriminating. In this case the Hon ble High Court noted that the authorities below have not considered a fact that in a case where there was a search operation, no assets or cash was recovered from the assessee, in such a situation what had prompted the assessee to make declaration of undisclosed income of Rs. 20 lakhs. 14. In the present case also the assessee during the course of search operation in the statement and subsequently by way of letter dated 23.04.2012, as has been reproduced by the AO in the assessment order, was sure about the surrender of Rs. 6.75 crores under various heads, however regarding remaining of Rs. 10.50 crore the assessee in the said letter clarified that the said amount pertaining to miscellaneous surrender shall be confirmed after study of all papers. Subsequently at the time of filing return the assessee also included part of amount of Rs. 4 crore on his account and his wife account totalling to Rs. 10.75 crore surrender and remaini ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of Tribunal including order of ITAT Indore Bench in the case of Ultimate Builders (supra). We are unable to see any ambiguity, perversity or any other valid reason to interfere with the findings arrived by the Ld. CIT(A) in this regard. Therefore we uphold the same. Accordingly ground no. 1 of Revenue is dismissed. 18. Apropos second part of ground no. 2 of Revenue the learned CIT(DR) supporting the assessment order submitted that it was established by the AO that the hand written loose papers record the cash payment of Rs. 6,25,000/- for present A.Y. 2012-13 by the assessee to various person which was not recorded in the books of accounts of the assessee. Therefore the AO was right in making addition u/s. 69C of the Act, as unexplained expenditure by the assessee. The learned CIT(DR) submitted that the Ld. CIT(A) granted relief to the assessee without any basis therefore impugned first appellate order may kindly be set aside by restoring that of the AO. 19. Replying to the above, the learned counsel of the assessee drew our attention towards relevant part of the first appellate order and submitted that in absence of any collaborative evidence to prove that there was exchang ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the such income is chargeable to tax is on the AO. In the absence of adequate material as to nature and ownership of the transactions, undisclosed income cannot be assessed in the hands of the assessee merely by arithmetically totally various figures jotted down on loosed document . 4.7.4 This is an undisputed fact that neither any incriminating material was found or seized during search proceedings nor any person has ever admitted about receipt/payment of the said amount, as per loose paper, from/by the appellant. In absence of any corroborative evidence to prove that there was any exchange of money by CASH/Cheque/Kind, AO has no locus to assume that appellant has paid cash amounting to Rs. 6,25,000/- in AY 2012-13. The AO has nothing on record which could establish that the said amount was actually received by the appellant, if the sum was received through cheque the entry of the same should have been reflected in any of the bank account of appellant. Also, the amount does not have any clear cut indication or narration whether the same represents receipt/payment or balance amount. Also, the amount or numbers written are incomplete and cannot be treated as amount in lakhs as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s, into lakhs. We are also in agreement with the conclusion drawn by the Ld. CIT(A) that the so called transactions does not have even any basic details of transactions to which the impugned amount represents receipts of payments for balance amount. Even date of payment mode of payment, details of payers/beneficiary purpose of transaction etc. was also not clear from the loose papers and there was no further enquiry or investigation by the AO in this regard. Therefore the Ld. CIT(A) was right in deleting the addition. 22. In first part of ground no. 2 of Revenue the Department has also challenged the deletion of addition of Rs. 75,61,000/- made by the AO, on account of undisclosed cash payment to Shri Sudheer Sharma of S.R Group u/s. 69C of the Act, which was deleted by Ld. CIT(A) without any basis therefore the impugned first appellate order may kindly be set aside by restoring that of the AO. The CIT(DR) vehemently supporting the assessment order submitted that the AO in para 25.1 to 25.5 rightly concluded that the seized documents are cash payment of Shri Sudheer Sharma appears in code S. Agarwal SA . The name of assessee was also renders in the diary of Sh. Sudheer Sharma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Trib) submitted that no addition could be made on the basis of evidence gathered from the extraneous source and on the basis of statement or document received during search operation on third party, subsequent to search and said material cannot be used u/s. 153A of the Act against the assessee. 26. On careful consideration of above rival submission from the stand of the AO and conclusion drawn by Ld. CIT(A) in paras 4.6 to 4.6.3 we clearly note that the AO proceeded to make addition in the hands of the assessee merely because the name assessee was appeared in the diary seized during separate search conducted on 20.06.2012 in the case of Shri Sudheer Sharma Group. In this situation, the Ld. CIT(A) was right in noticing that during the course of subsequent search at the premises of Vidya Niketan Society premise located at Plot no. 3, Khusiram tower, Bhopal on 20/06/2012 some papers were seized and date wise account of receipt and its head-wise utilisation by Shri Sudheer Sharma was found. On being asked by the bench the Ld. CIT(DR), did not controvert this factual position that the search operation on assessee group was conducted on 21.10.2011the said paper was seized during the c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ant during AYs 2009-10 to 2012-13 has taken loan from following banks:- Sn Name of Bank Account No. Period of Limit Amount Account Type 1 State Bank of India 30300355336 29-12-2007 to 18-06-2011 1,00,00,000/- OD 2 HDFC Limited 533329421 26-06-2007 to 11-03-2013 1,00,00,000/- Mortgage Loan 3 hOfc Limited 538732208 11-03-2010 to 11-03-2013 50,00,000/- Mortgage Loan 4 HDFC Limited 538732239 26-03-2010 to 11-03-2013 50,00,000/- Mortgage Loan 5 Bank of Baroda 18600400000344 29-09-2010 to Till Date 5,00,00,000/- OD ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ments, one for the purpose of share of profit from a firm, as mentioned in section 10(A), and the other segment in respect of salary, remuneration, etc., as provided in section 28(v). Both these claims, thus, function in two different directions. The firm itself is taxed at the rates prescribed and the partners are taxed only in respect of remuneration, commission, etc., but not in respect of their share of profit from the firm which is exempt under section 10(2A). A combined reading of sections 14A and 10(A) leads to the conclusion that the share of profit from a firm being exempt under section 10(A), the expenditure incurred in relation to this income is not subject to any deduction. Moreover, the profits of a firm are nothing but the profits of the partners who work for and on behalf of the firm. The profits, so earned, are firstly taxed in the hands of the firm and thereafter divided among the partners according to their profit sharing ratio. Due to this reason, the same profit is not again subject to tax in the hands of the partners. Thus, an assessee is not entitled to claim expenditure of any nature against the income earned from a firm as share of profit in the capacity of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ich he has become a partner against the amount received by him from the firm as remuneration/salary and assessed under the head Profits and gains of business or profession'. With the result, in view of the clear provisions of section 28(v), the salary income has to be considered as profit and gains from business or profession and, hence, interest paid on the money borrowed for the purpose of making capital contribution to the partnership firm has to be fully allowed in the hands of assessee/partner. Resultantly, the ground raised by the assessee was to be allowed Similar view was taken by Hon'ble ITAT Mumbai in the case of AH Baldota vs ACIT (2016) 103 TTJ 517 wherein it has has been held that:- Interest on borrowed capital - Assessment years 1994-95 to 1997-98 - Whether if a partner gets any bonus, commission, remuneration and interest from firm which is allowed as a deduction in hands of firm, then partner has a source of income under head 'Profits and gains from business and profession' against which expenditure incurred by partner, e.g., interest paid on borrowed capital invested in firm, can be claimed as deduction - Held, yes - Whether by virtue of s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed purchase deed ( page 55 of PB) was found for land of 1.459 Hectares located at Gram Katra Tec. Huzur purchased by M/s Agrawal Buildcon from Pankaj Makhija, Pradeep Sharma and Pradeep Hirani being the power of attorney holder of Smt. Rekha Bai, Shri Lalaram and Shri Devi Singh for a consideration of Rs. 1,76,50,000/-.During the course of post search enquiry, summons under 131 were issued to the sellers Rekha Bai and others and their statements were recorded jointly. During the statement these persons produced an agreement dated 27/11/2010 for the sale of 3.69 Acres of land between Shri Lakhmichand Hirani and Shri Pradeep Sharma on one side and Shri Lalaram, Shri Devi Singh and Smt. Rekha Bai on other side for a consideration of Rs. 5,03,68,500/-. The sale agreement is reproduced at page 33 of the assessment order. The joint statement of the sellers were recorded by the DDI (In.) who stated that they have received 5,03,68,5001- from Pradeep Sharma and Lakhmichand Hirani. The statement of Shri Pradeep Sharma and Pradeep Hirani were also recorded by ADIT. On the basis of these statements, the Ld. AO has made the addition of Rs. 3,53,80,000/- u/s 69 as unaccounted unexplained investm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ief to the assessee with following observations and findings:- Ground No 6:-Through this ground of appeal, the appellant has challenged addition of Rs. 3,53,80,000/- on account of on-money payment for purchase of land on protective basis. On perusal of assessment order it is seen that the additions have been made on protective basis in the hands of appellant and substantive basis in the hands of M/s Agrawal Buildcon. The substantive additions have been discussed and decided in depth vide appellate order passed in the case of M/s Agrawal Buildcon vide appeal No CIT(A)-3/BPL/IT-11392/2015-16 for AY 2012-13 dated 17.07.2020. In view of the facts that substantive addition has already been adjudicated in depth in the case of M/s Agrawal Buildcon, the addition made by the AO of the equal amount on protective basis in the case of appellant is directed to be Deleted.In case the demand in the hands of Ms Agrawal Buildcon are directed by the higher judicial authorities to make addition in the case of appellant then the demand in the case of the appellant would revive automatically to that extent. Thus, addition made by the AO amounting to Rs. 3,53,80,000/- is Deleted. Accordingly, appeal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rm purchased property from Shri Dayaram Chokse. During assessment proceedings the AO recorded statement of Shri Chokse by calling him u/s. 131 of the Act, wherein the stated to have received Rs. 1,03,00,000/- cash against sale of land. 37. The Ld. CIT(DR) further submitted that the assessee was provided due opportunity to cross examination Shri Bhagwan Ram Chokse son of Dayaram Chokse (seller of the land) on 10.12.2013 wherein he reiterated that he has received cash amount of Rs. 54 lakh on 24.12.2010 and Rs. 49 lakhs on 03.05.2011 which was deposited to the banks account of his family members immediately after receipt of cash from assessee Shri Sanjeev Agrawal. During statement recorded on 29.11.2013 the seller of land submitted copies of bank passbook of all family members wherein deposits have been made on 24.12.2010 and 04.05.2011 simultaneously to bank accounts of six family members of seller of land to the assessee. However this appeal is pertain to A.Y. 2012-13, therefore we are concerned with the issue of payment of cash on money of Rs. 49 lakh during FY 2011-12 pertaining to A.Y. 2012-13. The Ld. CIT(DR) submitted that the Ld. CIT(A) has granted relief to the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o incriminating material was found during the course of search suggesting exchange or payment of on money by the assessee to the sellers and the land. He further submitted that the land was not purchased by the assessee and in fact, the same was purchased by M/s. Shiva Reality partnership firm which is an independent assessee and filing return of income. The learned counsel also pointed out that the sellers failed to explain where the said cash received was utilised and date of receipt of cash. Therefore the Ld. CIT(A) was right in grating relief to the assessee. The learned counsel submitted that the AO was not justified in making addition on account of owned money paid to sellers u/s. 69A of the Act in absence of any collaborative evidence and simply relying on the basis of statement of third party. Therefore addition made by the AO amounting to Rs. 49 lakh may kindly be deleted. The learned counsel submitted that the facts and circumstances of other issues wherein the Ld. CIT(A) has deleted the addition of rs. 22,70,000/- and 18,50,000/- are also identical and similar therefore the contention of assessee is equally applicable to other second and third limbs of grounds of reven ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to seller, cannot be extended to the provision of section 69 or 69B of the Act in the case of purchaser i.e., present assessee. The learned counsel submitted that such statuary legal fiction cannot be extended to make addition in the case of purchasers, therefore the AO was not justified in making additions on account of owned money paid to seller s u/s. 69 of the Act, in absence of any collaborative evidence merely on the basis of difference between consideration shown in the registered sale deed and valuation taken by the Stamp Valuation Authority. The learned counsel submitted that even otherwise provision of section u/s. 56(2)(vii)(b) of the Act is applicable with effect from A.Y. 2014-15 and not the present A.Y. 2012-13 therefore in view of order of ITAT Chandigarh Bench in the case ITO vs. Ms. Inderjeet Kaur (2012) 50 SOT 377 (Chd.) the addition could not have been made in the hands of assessee under any provision of the Act, applicable at that point of time for the transactions undertaken during FY 2011-12 pertaining to A.Y. 2012-13. 43. Placing rejoinder above the Ld. CIT(DR) submitted that in para 4.3.4 the Ld. CIT(A) noted that the sellers failed to explain where the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lakh whereas the fair market value was Rs 57,70,000/- and thus the AO rightly concluded that the whole deal was supervise and managed by Shri Sanjeev Agrawal being a key person of the firm therefore he made substantive addition in the hands of assessee and protective addition in the hands of M/s. Shiva Reality treating the same as unexplained investment u/s. 69B of the Act. Therefore the order of the AO is quite correct which requires no interference. The Ld. CIT(DR) vehemently pointed out that the Ld. CIT(A) has granted relief to the assessee without any reasonable and justified basis. Therefore first appellate order may kindly be set aside by restoring that of the AO. 46. On careful consideration of above submission first of all, we take up the issue of payment of own money of Rs. 49 lakh to Shri Dayaram Chokse and Rs. 18,50,000/- to Shri Kanhiyalal Pal on account of purchase of land i.e. second third part og ground no. 4 of revenue. From the para 21 to 21.13 of assessment order it is clear that the Assessing Officer recorded statement of Shri Bhagwan Das Chokse son of Shri Daya Ram Chokse on behalf and presence of his father Shri Daya Ram Chokse, who appeared before the AO ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he AO in the relevant paras of assessment order wherein date of payment and its used has been mentioned. The Ld. CIT(A) was mislead the facts and thus its findings arrive on the issue of own money of Rs. 49 lakh does not survive and requires re-adjudication by the Ld. CIT(A) after taking comments of the AO regarding explanation and allegation of the assessee. 48. The similar position is also discernable on the issue of own money of Rs. 18,50,000/- from Shri Kanhiya lal Pal and this third limb of ground no. 4 of revenue also require to be re-adjudicated by the Ld. CIT(A) after calling comment/remand report from the AO on the explanation, submissions and documentary evidences, if any, filed by the assessee. Therefore, in view of foregoing the second and third limb of ground no. 4 of revenue are restored to the file of Ld. CIT(A)for a fresh denovo adjudication, without being influenced from the earlier first appellate order and after allowing due opportunity of hearing to the assessee. 49. So far as regarding fourth limb of ground no. 4 of revenue, pertaining to the challenging deletion of addition of Rs. 22,70,000/- is concerned the A.O. made addition only on the strength of co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to nature and ownership of the transactions, undisclosed income cannot be assessed in the hands of the assessee merely by arithmetically totally various figures jotted down on loosed document Hon'ble MP High Court in the case of Krishna Kumar Rawat vs UOI others (1994) 214 ITR 610 has held that the market rates for the purpose of registration of an immovable property as notified by the sub registrar can also have no application for determining the market value under Chapter XXC of the Act. It is limited only for payment of the stamp duty. The AO has simply presumed that village samardha kaliysot is a prime area of tehsil Huzur, Bhopal and the rates of land are very high. It is settled legal pronouncement that presumption how strong may cannot take place of evidence. Hon'ble ITAT Ahmedabad in the case of Vallabhbhai Purshottambhai Surani 54 SOT 556 (ITAT Ahmedabad) has hel d as under:- Section 69B is deeming fiction which provides that addition can be made by AO when conditions mentioned therein are satisfied. A failed to bring on record any material to support his estimated price. Section 50C is deeming provision where under stamp duty rate is treated as full v ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uding all categories of assessees so that the assets received without or inadequate consideration may be brought to tax. The said provision is not even applicable in instant case and even otherwise provision of section 56(2)(vii)(b) is applicable w.e.f. A.Y. 2014-15 only. Hon'ble ITAT, Chandigarh Bench in the case of ITO v/s Mrs. Inderjit Kour (2012) 50 SOT 377 (Chd) has held that deeming fiction created u/s 50C regarding full value of consideration received or accrued to seller, cannot be extended to the provisions of section 69, in the case of purchasers. Such statutory legal fiction cannot be extended, to make in the purchasers liable to tax, in the context of undisclosed investment us 69 of the Act. It has been held that legal fictions created for a definite purpose should be limited for that purpose and cannot be extended beyond their legislative needs. It is well-settled that deeming provision creating legal fictions, specially in taxing statute have to be strictly construed. 51. In view of above from the assessment order, we clearly note that, except copy of registered sale deed executed in favour of firm of M/s. Shiva Reality, there was nothing else in the hands of A ..... X X X X Extracts X X X X X X X X Extracts X X X X
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