9911796707
TMI Blog2024 (3) TMI 540X X X X Extracts X X X X X X X X Extracts X X X X ..... rty was registered by the assessee and no evidence of payment by the assessee is mentioned neither in the agreement nor on any material gathered during the search or post search enquiries. Even the cheque payments made by the alleged buyer in the agreement have been returned back to the buyer. Hence, the assessee cannot be tied up with the agreement which is executed between four unrelated parties to the assessee. CIT(A) has duly examined the evidences on record and the confirmative evidence of the seller and came to a conclusion that assessee cannot be taxed for the money which has not paid. CIT(A) has also examined the comparable instances of the sale of property in the same area which is at parity with the value adopted and purchased by the assessee. Hence, in view of the tangible material on record duly examined by the CIT(A), we hereby affirm the decision of the ld. CIT(A). Decided against revenue. - Dr. B. R. R. Kumar, Accountant Member And Ms. Astha Chandra, Judicial Member For the Assessee : Sh. Amit Goel, CA Sh. Pranav Yadav, Adv. For the Revenue : Ms. Sapna Bhatia, CIT-DR ORDER PER DR. B. R. R. KUMAR, ACCOUNTANT MEMBER: The present appeals and the Cross Objections have ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... idence under Civil Laws. The deletion of sole addition of Rs. 12,06,00,000/- based on technicalities, if any, is contrary to probability the human and circumstantial evidence. 7. (a) The Ld. Commissioner of Income Tax (Appeals) is erroneous and not tenable in law and on facts. (b) The appellant craves leave to add, amend any/all grounds of appeal before or during the course of hearing of appeal. 3. Common issues raised by the assessees in CO Nos. 25 28/Del/2022. In CO No. 28/Del/2022, following grounds have been raised by the assessee: 1. That the notice issued under section 153A of the Act is illegal, bad in law and without jurisdiction. 2. That the assessment order dated 19.03.2021 passed u/s 153A r.w.s. 143(3) of the Income Tax Act, 1961 ( the Act ) by the Assessing Officer ( A.O. ) and the additions made therein are illegal, bad in law, without jurisdiction and barred by time limitation. 3. That on the facts and circumstances of the case and in law CIT(A) has erred in not appreciating that addition of Rs. 12,03,00,000/- made by the AO is beyond the scope/jurisdiction of section 153A of the Act as there were no incriminating material belonging to Assessee found during the course ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... brothers and they have sold the property situated at 10/42, Punjabi Bagh West, New Delhi, to Mr. R.K. Chawla and Mr. Brij Kumar for a total consideration of Rs. 40,06,00,000/-. The stamp for registration of document was purchased by Brij Kumar and others who are the 2nd party to the agreement. Further, it is observed that a sum of Rs. 10 crores were paid by the buyers to Praveen Kumar and Sunil Kumar on various dates out of which Rs. 8.50 crores were paid by way of cash and remaining Rs. 1.50 Crores were paid through cheque to the owners by Sh. Brij Kumar. The agreement to sell is also having the receipts duly acknowledged on revenue stamps of payments made to Praveen Kumar and Sunil Kumar and are signed by all the four parties to the agreement namely, Sh. Praveen Kumar, Sh. Sunil Kumar, Mr. R.K. Chawla and Mr. Brij Kumar. 7. In short, it is the agreement to sale between the owners Sh. Praveen Kumar and Sh. Sunil Kumar as the first party and Sh. Brij Kumar and Sh. R. K. Chawla as a second party. For the sale of property at Punjabi Bagh measuring 1088 sq. yrds. for Rs. 40.06 Cr. 8. The Assessing Officer has examined the agreement to sale dated 13.07.2015 which was seized from his re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f Rs. 40.06 Cr. and Rs. 16 Cr. 14. The submission of the ld. DR is reproduced as under: During the course of hearing, exhaustive arguments were made with regard to the Department's Appeal in these cases. A reiteration of the arguments for the benefit of the Bench is being made as under: In this case, a photocopy of an 'Agreement to Sale' (ATS) was seized from the residential premises of the asssessee bearing address House No 10, Road No 42. Punjabi Bagh West, New Delhi during the course of search u/s 132 of the I. T. Act on 20.07.2018. The ATS was in respect of the same residential property in which the assessee was residing at the time of search. The ATS dated 13.07.2015 was between sellers (Praveen Kumar and Sunil Kumar) and buyers (Shri Brij Kumar and Shri R. K. Chawla) accompanied by receipts of cheque and cash payments duly signed by the parties involved. The total consideration for the purchase of this property as per ATS was Rs. 40 cr. Subsequently, the property was purchased by the assessee and his wife Smt. Alka Mendiratta, vide registered agreement dated 15.01.2016. One of the buyers in ATS, Shri R. K. Chawla was the witness to the registered deed for the purc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... favour of the sellers. These payments were made by Shri Brij Kumar to Praveen Kumar and Sunil Kumar. However, in the statement recorded u/s 131 of the I.T. Act, he has denied any knowledge about the ATS. He stated that he had loaned the cheque amounts of Rs. 75 lakh each to Praveen Kumar and Sunil Kumar on which no interest had been charged. Evidently, this is a story that has been made up to cover the transaction. Further, the bank account statements of assesses, Yashpal and Alka Mendiratta, contain transactions with Shri Brij Kumar in the period around ATS and registered deed. A copy of the bank statement of assessee and his wife showing the financial transactions with assessees during the same financial year was submitted during the course of hearing. The assessee and his wife through their Joint A/e had made a payment of Rs. 3 crore to Shri Brij Kumar on 07.12.2015, 2 days before making a payment of Rs. 2.5 crore to Shri Praving Kumar. Subsequently, an amount of Rs. 1 crore was received from Brij Kumar on 16.01.2016. Evidently, Shri Brij Kumar was known both to the sellers and the assessee and was a connecting link. In view of the facts as mentioned above, it is evident that ev ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ld. AR relied on the order of the ld. CIT(A). 16. We have examined the adjudication of the ld. CIT(A) which is as under: 10.1.1 From a bare perusal of the above ATS (i.e. Pages 10 to 19 of Annexure A1 Party BW), the following pertinent facts are observed: 1. That the ATS was found from the premises of the Appellant in photocopied form and not in original form. 2. That even though it was found from the premises of the Appellant (i.e. from Property bearing house no. 10, road no.42, West Punjabi Bagh, New Delhi), for proving possession it is necessary to show that the person concerned had the intentiopossessendi. There is nothing on record which would prove that the Appellant ever had any intention to execute it as it was even not a party to the agreement. 3. That the Appellant and the spouse of the Appellant were not authors or even party in any capacity of ATS. 4. That the ATS was not even prepared or signed by any other person on behalf of the Appellant or the spouse of the Appellant or under their instructions. There is no such allegation even in the assessment order. 5. That the Appellant and the spouse of the Appellant had nowhere put their signatures in the ATS. 6. That the App ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The mere fact that the same property has been bought by the Appellant at a lesser amount, at a later date, cannot perse, on its own and without any corroborative evidence on record lead to any presumption or assumption of any unexplained investment. The fact that this property as referred in the said proposed ATS was purchased by the Appellant and the spouse of the' Appellant from the parties whose names have been recorded as sellers in the ATS. Thus, except for the mere coincidence of the property and the sellers being the same, there cannot be a presumption, without any corroborative evidence that the Appellant and his spouse had at-least made payments equivalent to the amount stated in the purported ATS between other parties, which was never executed. 10.2 From a conjoint perusal of the above statements on oath of both, i.e. Sh. Brij Kumar and Sh. R.K. Chawla, the following observations are made: a) That, both Sh. Brij Kumar and Sh. R.K. Chawla have specifically denied having any knowledge, about the existence of any agreement to sell entered by into by them with Sh. Sunil Kumar and Sh. Praveen Kumar. b) That, both Sh. Brij Kumar and Sh. R.K. Chawla have completely denied t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stated that he personally knows Sh. Sunil Kumar and Sh. Praveen Kumar. He stated that these both persons are his nephews and even the details of the city/town where each of them was residing has been stated. k) That, Sh. R.K. Chawla in response to question no. 16 of his statement, as aforesaid, had stated that he had signed the duly executed Sale deed entered into between the Appellant the spouse of the Appellant as buyers and Sh. Sunil Kumar Sh. Praveen Kumar as sellers with respect to Property bearing house no. 10, road no.42, West Punjabi Bagh, New Delhi. He stated that being uncle of Sh. Sunil Kumar and Sh. Praveen Kumar (i.e. Sh. Sunil Kumar and Sh. Praveen Kumar being the nephews of Sh. R. K. Chawla) he had signed the sale deed as a witness. Further he had specifically identified his signatures on the sale deed of the appellant/ spouse. 10.2.1 Thus, facts emanating out of statements recorded on oath of Sh. Brij Kumar and Sh. R. K. Chawla are that, (i) The proposed ATS was never signed by them. (ii) That the bank payments of Rs 1.5 Cr were made by Sh. Brij Kumar to Sh. Sunil Kumar and Sh. Praveen Kumar as loans (Rs.75lakhs each) and not as sale consideration for purchase of a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Sale deed of the appellant (as witness) is a very weak link to establish. 10.3 The AO had completely ignored the evidences filed by the appellant regarding the registered Govt. Approved valuer report as well as the comparative registered sales deeds submitted by the appellant and contended in the remand report that the addition has been made only on the basis of value of property reflected in the photocopy of ATS belonging to third parties. Detailed discussion on this issue will be made in subsequent para, after considering the legal position and applying it to the facts of the case. 11. The first plea taken by the appellant is that the photocopy of the document is not an admissible evidence and no addition can be made on the basis of photocopy of the document, which pertains to third party. The appellant had relied on various judicial decisions on this issue. 11.1 In the case of Vikrant Dutt Chaudhary vs. Commissioner of Income-tax, Panchkula (Haryana) [2017] 88 taxmann.com 727 (Punjab Haryana), it had been held as under: The very use of the word material in section 143(3) clearly shows that the Assessing Officer is not fettered by the technical rules of evidence and the like and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to be brought on record. These aspects are discussed in subsequent para. 12. The appellant had contended that the show cause notice dated 02.03.2021 was issued to the Appellant requiring the Appellant as to why the addition of Rs. 12,03,00,000/- be not made under Section 69C of the Act, though the addition was finally made by the AO under Section 69 of the Act. 12.1 In this regard, it is observed that that a show cause dated 02.03.2021 was issued by the AO to the appellant, requiring the appellant to show cause as to why the addition of Rs. 12,03,00,000/- be not made under Section 69C of the Act. The AO had, referred the provisions of Section 69C of the Act. Thus, even though there is a reference to a wrong section, it cannot be said that the Appellant did not get an opportunity to put forward the contentions and submissions and the relevant evidence before the AO. The Appellant had replied to this SCN, but the AO had made addition u/s 69 of the IT Act 1961. In the case of Maneka Gandhi vs. Union of India [on 25 January, 1978; 1978 AIR 597, 1978 SCR (2) 621], It was held by the Hon'ble Supreme Court as under: It is well established that even where there is no specific provisio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n made u/s 69, which are being considered in the adjudication of this issue. In view of the above discussion, the contention of the appellant is not acceptable and this plea of the appellant is, hereby, rejected. 13. The AO had applied the provisions of section 292C and section 69 for making the addition in the case of the appellant. 13.1 The section 292C, after the retrospective amendment w.e.f. 1975, made by the finance act 2007, read as under: Presumption as to assets, books of account, etc. 292C. (1) Where any books of account, other documents, money, bullion, jewellery or other valuable article or thing are or is found in the possession or control of any person in the course of a search under section 132 or survey under section 133A, it may, in any proceeding under this Act, be presumed (i) that such books of account, other documents, money, bullion, jewellery or other valuable article or thing belong or belongs to such person; (ii) that the contents of such books of account and other documents are true; and (iii) that the signature and every other part of such books of account and other documents which purport to be in the handwriting of any particular person or which may rea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... AT had held that: Section 69A, read with section 292C, of the Income-tax Act, 1961 - Unexplained money (Presumptive addition) - Assessment year 200910 - Assessee sold a property and derived long-term capital gain - During search, diary of a third party was seized from residence of assessee - This diary had notings which showed an amount of Rs. 1.15 crores as sale consideration - Assessing Officer observed that in registered sale deed, total consideration was shown at Rs. 29.50 lakhs - By making presumption as per section 292C, he considered sale consideration shown in diary as actual consideration and made additions accordingly - There was nothing on record to suggest that assessee had underestimated value of property and violated circle rate as prescribed by government - Even diary admittedly did not belong to assessee, and noting of same were also not in handwriting of assessee - Furthermore, entry recorded in diary qua amount of sale was not confirmed from buyers of property - Whether since Assessing Officer had drawn presumptions only on basis of notings of diary without making independent exercise; and entry found in diary was without any corroborative evidence and had no auth ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lying the ratio of the above decision on the case of the appellant, the AO has not established that any investment over and above the consideration mentioned in the registered sale deed was made by the appellant. Therefore, the AO could not have drawn a presumption that the appellant has made investment over and above the consideration mentioned in the registered sale deed. (iii) In the case of Smt. Kundan Singh vs. The ACIT, Central Circle25, New Delhi, ITA. No. 1797/Del./2015,during the course of search an agreement to sell in respect of certain land for the value of Rs. 297.87 lacs was found. However, as per the registered sale deed these lands were purchased for Rs. 31 lakhs and Rs. 29 lakhs. The assessing officer made the addition on the basis of the agreement to sell on the ground that subsequently the transaction has actually took place, the parties to the agreement were same and even the cheque payment as per the agreement to sell was also reflected in the bank account of the assessee and the same was mentioned in the registered sale deed. The CIT(A) deleted all the addition except amount of Rs. 50 lacs which was mentioned in the agreement to sell as the cash amount paid by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t in the hands of the assessee. On appeal: Held, dismissing the appeal, that the assessee had stated that there was no transfer of money between the assessee, R and M and they had denied the receipt of any money from the assessee. In the face of these denials, there ought to have been corroborative evidence to show that there was in fact such a transfer of money. Both the Commissioner (Appeals) as well as the Tribunal had come to the conclusion that there was no such material on record. The Assessing Officer relied on certain other transactions entered into by the assessee with R and M for drawing a presumption in respect of the transfer of money but the Tribunal rightly held that those were independent transactions and had nothing to do with the memorandums of understanding. No substantial question of law arose. The facts of the case of the appellant are much stronger that the facts in the above case. In the aforesaid case, the MOU and registered sale deed was between the same parties i.e. the assessee and the sellers whereas in the present case of the appellant, there is no MOU or ATS between the appellant and the seller. In the aforesaid case, there was mention of cash payment b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uation report available whereas in the present case, the appellant has submitted the valuation report of the independent valuer and also the comparative sale instances and the AO has not pointed out any discrepancy in these report/instances. (vi) The Hon'ble Kerala High Court in the case of CIT vs. Smt. K.C. Agnes (2003) 262 ITR 354 (Kerala) had held as under: After considering the evidence and on the basis of the assessment order passed against the assessee, the case of the assessee that the property was purchased at the rate of Rs. 8,000 per cent, had been accepted. Thus, the Tribunal allowed the appeal. The sale deed showed that the price was Rs. 8,000 per cent while the agreement showed that the parties agreed to purchase the property at Rs. 12,951 per cent. A receipt was also relied on in the form of a fetter to show that the property was agreed to be purchased at Rs. 12,951 per cent. When a document shows a fixed price, there would be a presumption that it is the correct price agreed upon by the parties. It is true that on the basis of the agreement, the sale deed is executed. But it is not necessary that the price stated in the agreement will be the price shown in the sa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Held yes. Applying the ratio of the aforesaid decision on the present case of the appellant, the AO could not have drawn any adverse inference in the case of the appellant w.r.t. value recorded in registered sale deed. There is no corroborative evidence brought on record by the AO to disregard the value stated in the registered sale deed. (viii) In the case of CIT vs. Provestment Securities (P.) Ltd. [2016] 65 taxmann.com 69 (Delhi), the Hon'ble Delhi High Court has held as under:- 14. At this stage it is necessary to refer to Section 69 of the Act, which reads as under: 69. Where in the financial year immediately preceding the assessment year the assessee has made investments which are not recorded in the books of account, if any, maintained by him for any source of income, and the assessee offers no explanation about the nature and source of the investments or the explanation offered by him is not, in the opinion of the Assessing Officer, satisfactory, the value of the investments may be deemed to be the income of the assessee of such financial year. 15. It is apparent from the plain language of Section 69 of the Act that in order for any addition to be made under Section 69 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... finding was not correct, it was necessary for the Tribunal to have recorded reasons for reversing the same. The observation of the Tribunal that the difficulty as to financial year had to be finalized in accordance with the provisions and the date of search and seizure is too general and vague. It does not indicate anything. When the provision requires fulfillment of certain prerequisite conditions before the assessee can be called upon to explain, the Tribunal has to record its finding on this issue in a specific manner, because the case of the assessee all along has been that in the first place the seized documents do not reflect any investments, in the second place, even if the entries could be treated as investments made by the assessee, it was further necessary to show that such investments have been made by the assessee in the financial year immediately preceding the assessment year and are not recorded in the books maintained by the assessee. The Tribunal's order does not record any finding. In fact, the Tribunal is hardly aware, it appears, as to what the requirements of section 69 are, and if it is aware, it has consciously chosen to ignore the same. It could not have ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nsideration made by the appellant over and above the amount recorded in the registered sale deed nor there is any confession/admission by the sellers of having received any amount over and above the amount recorded in the registered sale deed. Applying the ratio of the aforesaid decision on the present case of the appellant, the AO could not have drawn any adverse inference. (xii) The Hon'ble Supreme Court in the case of P.R. Metrani vs CIT (Appeal (civil) 5673-5675 of 2002 dated 15/11/2006) held as under: A presumption is an inference of fact drawn from other known or proved facts. It is a rule of law under which courts are authorized to draw a particular inference from a particular fact. It is of three types, (i) may presume , (ii) shall presume and (iii) conclusive proof . May presume leaves it to the discretion of the Court to make the presumption according to the circumstances of the case. Shall presume leaves no option with the Court not to make the presumption. The Court is bound to take the fact as proved until evidence is given to disprove it. In this sense such presumption is also rebuttable. Conclusive proof' gives an artificial probative effect by the law to cer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... any person in the course of search under Section 132 or survey under Section 133A of the Act, it may be presumed that such books or documents belong to such person. Undisputedly, such presumption is rebuttable. As per this judgment, the presumption u/s 292C and 132 are rebuttable. (xiv) The ITAT Mumbai Bench in the case of Sh. Pandoo P. Naig vs ACIT in ITA Nos. 7089 7364/Mum/2011 and ITA No. 6671 . 6672/Mum/2012 (supra) vide order dated 24.06.2016 had held as under: 14. We find that the wording of the section 292C which supposes the presumption to be taken is qualified with the words 'may be', hence, it may or may not be presumed that such documents belong to the person searched. Firstly, the section uses the word may presume' and not 'shall presume', hence the presumption of facts under section 292C is not a mandatory or compulsory presumption, but, a discretionary presumption; secondly, such a presumption is not a conclusive presumption but is a rebuttable presumption because it is a presumption of fact not a presumption of law. The presumption u/s 292C and 132 are not presumption of law, but facts and are rebuttable. (xv) In the case of Vijay Kumar Aggarwal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has rightly held that the registered document date 21-8-2006 under which the respondent purchased the above property showed that only Rs. 65.00 lakhs was paid to the vendor by the respondent; that there was no evidence to show that the respondent had paid Rs. 1.00 crore in cash also to the vendor; that no presumption of such payment of Rs. 1.00 crore in cash can be drawn on the basis of an entry found in a diary/loose sheet in the premises of C. Radha Krishna Kumar which is not in the respondent's handwriting and which did not contain the name of the respondent or any date of payment or the name of the person who made the payments. It rightly held that the Revenue failed to establish the nexus of the seized material to the respondent and had drawn inferences based on suspicion, conjectures and surmises which cannot take the place of proof. We also agree with the Tribunal that the assessing officer did not conduct any independent enquiry relating to the value of the property purchased and the burden of proving the actual consideration in the purchase of the property is on the Revenue and it had failed to discharge the said burden. The facts of the case of the appellant are even ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssing officer to first prove that the assessee has actually expended an amount which he has not fully recorded in his books of account; (b) there has to be a finding that such amount was actually paid by the assessee over and above the declared consideration and the extra amount was not recorded in the assessees books of account; (c) the provisions of the Wealth Tax Act and Schedule III thereto cannot be imported into the provisions of Section 69B because the enquiry under the Wealth Tax Act is towards estimating the market value of the property which is different from the actual price paid for the property; (d) Section 69B does not permit an inference to be drawn from the circumstances surrounding the transaction that the purchaser of the property must have paid more than what was actually recorded in this books of account, because such an inference could be very subjective and could lead to the taxation of notional or fictitious income contrary to the strict provisions of Article 265 of the Constitution of India as held by the Supreme Court in the case of KP Verghese \/s. ITO (1981) 131 ITR 597. (xx) In the case of CIT vs. Naresh Khattar (HUF) 261 ITR 664 (Del), the Court had hel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce he is not party to the agreement till he had signed the same. The mere fact that this agreement was found in the possession of the Assessee does not lead us anywhere. We find no hesitation in holding that this addition of Rs. 17,00,892/- made by Assessing Officer is based on surmises and guess work and on this point case of Dhakeswari Cotton Mills Ltd v. Commissioner of Income Tax, (1954) 26 ITR 775, may be referred to... (xxii) The Hon'ble Delhi High Court in the case of CIT vs. Ved Parkash Chaudhary reported in 305 ITR 245 held that even where a MOU was found then too in view of the denial of the parties to the MOU, it was held that, no addition is tenable in view of the nonavailability of the corroborative evidence. Infact, in the above case, it was held by Their Lordships as under: 12. In so far as the present case is concerned, the Assessee had stated that in fact there was no transfer of money between him and Ravi Talwar and MadhuTalwar. On the other hand, Ravi Talwar and Madhu Talwar had denied receipt of any money from the Assessee. In the fact of these denials, there ought to have been corroborative evidence to show that there was in fact such a transfer of money. B ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e. It cannot be enlarged by importing another fiction, namely; that if an amount was receivable during the previous year it must be deemed to have been received during that year. So too, in the instant case, the fiction serves the purpose, if the said compensation was deemed to be the profits of the previous year or of the year in which it was received. This fiction cannot be enlarged by giving the expression received a technical meaning which it may bear in the mercantile system of accountancy. (xxv) In the case of ACIT vs. M/s Vatika Greenfield (P) Ltd. ITR 113 (AT) (Del), the court had held as under:- 21. A conjoint reading of the above decisions suggests that taxing statutes have to be interpreted strictly. In the deeming provision what is prescribed is to be deemed and deeming provision cannot be extended beyond the legislative scope. The presumption as envisaged in s. 292C is limited to the correctness of the documents found at the time of search or survey, but that presumption has not been extended by the statute to be presumed to be the income of the assessee. If it is so, then unless some evidence/material is brought on record by the Revenue to say that what is stated in t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mentioned in this ATS and not the appellant. In fact, on the basis of cash transactions reflected in the seized documents, the addition of Rs 6 Cr had been made by the AO, in the case of Sh. Brij Kumar (one of the buyers in ATS) in the, 153C order passed on 06.08.2021. (iv) This property was later registered at value of Rs. 16 crores in the name of the appellant and his wife and no evidence of any payment proposed or made over above this amount had been brought on record by the AO. However, the AO had presumed on the basis of the value mentioned in the ATS that the actual value of the property could be at Rs. 40.06 crores. 16.2 As discussed above, the presumption u/s 292C is rebuttable and the appellant had rebutted the value of property mentioned in the photocopy of ATS of third parties with following the evidences: (i) The agreements on stamp papers are private commercial agreements between two parties. The ATS is between buyers C D with sellers A B, whereas the registered sale deed is between other set of buyers E F with sellers A B. The price and the terms of agreement are specific between the parties and cannot be generally imported from the agreement between one set of parti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of this property at Rs. 40.06 crores, as mentioned in the ATS cannot be taken on the face value. There could be a case where buyers of ATS might have negotiated at higher value than the market value of the property or some issues might have cropped up which led to the cancellation of this agreement at mutually agreed terms between the buyers sellers of this ATS and the penal terms of the ATS were not invoked. At the most, this information of value of Rs. 40.06 crore mentioned in the agreement could have been the starting point of Investigation to bring on record evidences of a different value than mentioned in the sale deed of the appellant. (v) The value mentioned in the registered sale deed of Rs. 16 crore with the Govt. Authorities, without any evidence on record, of any other amount paid by the appellant/his spouse to the sellers and the confirmative affidavit of the seller, which have not been rebutted by the AO in the assessment order. These are admissible concrete evidences, rebutting the presumption of the value adopted by the AO as per the seized ATS belonging to third parties. (vi) The appellant had filed the valuation report of a Govt. registered valuer, wherein the pro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of investment OR the explanation offered by the Appellant is not satisfactory in the opinion of the AO. In the present case, the assessment order is completely silent as to how and in which manner the AO had invoked the provisions of Section 69 of the Act. There are no details in the assessment order of the unexplained investment added by the AO. No material has been brought on record, except for presuming probability that the appellant must have purchased the residential house property atleast for the amounts stated in the photocopy of the ATS. There is no other evidence on record that anything over and above, as mentioned in the registered sale deed, is paid by the appellant. (ix) From the above decisions at (xxiii) to (xv) in para above, following noteworthy principles follow- a) Every fiction created under law has a purpose and the meaning of expressions used in said deeming provision should be considered in ordinary sense, in which purpose, deeming provision is created serves the purpose. b) If the technical meaning ascribed to the expressions used in legal fiction enlarges the original scope for which legal fiction was introduced, in such case, such (technical) meaning should ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ds in the opinion of the Assessing Officer do not precede the phrase an assessee has incurred any expenditure . The opinion of the A.O is material and relevant only with regard to the explanation of the appellant and not with regard to the incurrence of the expenditure. In the instant case, the A.O has not come across even a single bill or voucher or delivery challan to even indicate that the appellant incurred any expenditure as alleged by the A.O. It is not the case of the A.O that the parties whose name have been found recorded in the diary have confirmed having received the payments from the appellant even remotely or indirectly . In the case of Ram Krishan Gupta vs. DCIT CC-4, New Delhi, the ITAT Delhi had held that But it is not necessary that the price stated in the agreement will be the price shown in the sale deed. Sometimes, it may be higher and sometimes it may be lower. Sometimes intentionally a lesser value may be shown in the sale deed. Even if it is assumed to be so, unless it is proved that the agreement was acted upon and unless the amount stated in the agreement was paid for the sale one cannot come to the conclusion that the price mentioned in the sale deed is no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on of Rs. 17,00,892/- made by Assessing Officer is based on surmises and guess work. The Hon ble Supreme Court in Commissioner of Income tax v. Daulatram Rawatmull, (Supra), had held that even if circumstances raise a suspicion, suspicion cannot take the place of evidence. In view of these facts and position of law it is observed that the circumstantial evidences in the case of non executed ATS of third party, cannot take the place of evidence in the case of the appellant. The AO had not brought any evidence of any payment made by the appellant/his wife over above the amount reflected in the sale deed of the appellant/wife. The precondition to invoke section 69, that the appellant had made unaccounted investment in property, is not backed by any evidence on record of unaccounted payment by the appellant/his wife to the sellers. The appellant had rebutted the evidences found during the search with credible admissible evidences to establish the price of the property paid by him/his wife was as per the registered sale deed and thereafter the burden of proof shifts to the AO. As discussed above the courts have not agreed to presumption of 292C for invoking sections relating to deemed i ..... X X X X Extracts X X X X X X X X Extracts X X X X
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