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TMI Blog2023 (9) TMI 1512X X X X Extracts X X X X X X X X Extracts X X X X ..... mpugned order. Rental Income - We are of the opinion that estimation of higher rental income is without any basis. It is not the case of Ld. AO that the rental income was less than municipal rateable value. CIT(A) has already deleted this addition. Capital Gain - AR has drawn attention to the copy of purchase deed and encumbrance certificate towards the cost of acquisition. AR also submitted that the property was in joint ownership of assessee and his wife and therefore, entire addition could not be made in the hands of the assessee. Considering the same, this issue stand restored back to the file of Ld. AO for de novo adjudication - grounds stand allowed for statistical purpose. Purchase of Property at Muthukad, ECR - AR submitted that the property was purchased for Rs.39.48 Lacs out of which an amount of Rs.20 Lacs was funded through bank loan and the remaining amount was funded out of sale of agricultural land during AY 2007-08 - Considering the same, this issue stand restored back to the file of Ld. AO for de novo adjudication with a direction to the assessee to file the requisite details and substantiate its claim. The corresponding grounds stand allowed for statistical purpos ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 6-07, 2007-08 and 2009-10. The appeals for AY 2006-07 and 2007-08 have separately been adjudicated by us vide ITA Nos.279/Chny/2020 146/Chny/2020. This appeal arises out of impugned order passed by learned Commissioner of Income Tax (Appeals)-19, Chennai [CIT(A)] on 27-09-2019 in the matter of an assessment framed by learned Assessing Officer (AO) u/s 144 r.w.s. 254 of the Act on 30-12-2016. The elaborate facts of the case and the circumstances in which the assessee had acquired certain parcels of land in AY 2006-07 and sold the same in AY 2007-08 have already been enumerated by us in our order for those years. In the present appeal, the assessee is aggrieved by confirmation of certain additions. 2. The Registry has noted delay of 35 days in the appeal, the condonation of which has been sought by Ld. AR on the strength of an affidavit of the assessee. It has been submitted that the delay has accrued due to adverse medical conditions being faced by the assessee. The Ld. CIT-DR has opposed the condonation of delay. However, keeping in view the period of delay and the contents of the affidavit, we condone the delay and admit the appeal for adjudication on merits. 3. The Ld. AR advance ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , Ld. AO estimated the net rental income at Rs.3 Lacs per annum. (v) Capital Gain The assessee reflected Short Term Capital Gains of Rs.23.09 Lacs on sale of property situated at Adyar, Chennai. The assessee could not furnish copy of purchase and sale deed and details of cost of improvement for Rs.2.10 Lacs. Accordingly, Ld. AO treated the entire sale consideration of Rs.52.50 Lacs as unexplained credit u/s 68. (vi) Purchase of Property at Muthukad, ECR During search, a cope of sale deed between the assessee and one Shri P. Shanmugam (PS) was found and seized. It transpired that PS purchased a property located in Muthukad, Chennai on 12-01-2007 for Rs. 26.22 Lacs as against market value determined by sub-registrar for Rs. 49.64 Lacs. This property was subsequently purchased by the assessee and his wife Smt. Rajalakshmi Vettrivel on 18.05.2007 for Rs. 39.80 Lacs as against market value of Rs. 49.80 Lacs. The assessee had availed bank loan from PNB. However, it was noted that this property was purchased by PS out of funds provided by the assessee and his family. The bank account of PS was opened on 10-01-2007 and amount of Rs. 30 Lacs was received from PNB. Thereafter, he issued a Ch ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... come of Rs.1.65 Lacs was stated to be out of sale of produce from Land at Sengalipalayam. The source of deposit of Rs.90.97 Lacs was stated to be out of sale consideration as received during the AY 2007-08. The assessee also assailed the addition of unexplained expenditure of Rs .4.48 Lacs. 5.2 However, not convinced, Ld. CIT(A) confirmed the substantial assessment. Regarding Jewellery, Ld. AO was directed to treat jewellery of 200 grams in the hands of each member of the family as explained. The addition of professional income was reduced to the extent of what had been reported by the assessee. The Ld. AO was directed to allow deduction u/s 80C on the basis of evidences. Rest of the additions were confirmed against which the assessee is in further appeal before us. Our findings and Adjudication 6. Our adjudication, in the light of rival submissions, would be as under: - (i) Cash found at the time of search The Ld. AR has submitted that as per copy of Panchnama, cash of Rs.2 Lacs only was seized and the seizure of Rs .6.90 Lacs as noted by Ld. AO is factually incorrect. The Ld. AR also submitted that the same was sourced out of assessee s business income and the same was duly offer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... round, was framed on best judgment basis and the assessee was in further appeal before Tribunal primarily on the ground of violation of natural justice. Accordingly, the assessment was set aside and Ld. AO was directed to frame de novo assessment. Therefore, this addition, in such a case, could very well be made by Ld. AO in the set aside proceedings. The legal grounds as urged by the Ld. AR stand dismissed. On merits, considering the fact that the assessee was holding agricultural land and considering the quantum of income, we are of the opinion that this income could not be considered as income from undisclosed sources. Therefore, we direct Ld. AO to accept the same as agricultural income of the assessee. The corresponding grounds stand allowed to that extent. ( viii) Undisclosed Bank Accounts The Ld. AR has submitted that peak balances have wrongly been worked out by Ld. AO. The Ld. AR further submitted that peak credit pertains to carry forward balances of AY 2007-08 and their source is attributable to consideration from sale of agricultural land during AY 2007-08. The Ld. AR also averred that the provisions u/s 68 could not be invoked for credit made in the bank account. In o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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