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TMI Blog1982 (10) TMI 62X X X X Extracts X X X X X X X X Extracts X X X X ..... by the assessee on two points. According to the assessee, the asset sold by him on 3-7-1974 was held by him right from 7-3-1969, i. e., the date of agreement under which the said asset was acquired by the assessee. Accordingly, the assessee claimed that he held the asset for more than sixty months, and so it became a long-term capital asset. The ITO did not agree. According to him, the assessee acquired the flat only on the day when he took possession of the same, i. e., in August 1971, and not before. If that be so, then the period for which the assessee held the asset was less than sixty months and so, it became a short-term capital asset. This was the first dispute between the assessee and the ITO. The second dispute related to the quantum of the sale proceeds received by the assessee. According to the assessee, he received only a sum of Rs. 2,25,000 and nothing more. However, the ITO found from a statement by B. T. Mirchandani, partner of T. M. Bhagwandas Sons, who acted as brokers for the sale of the assessee's flat to Batliboi Co., that another sum of Rs. 68,000 was paid in cash to the assessee as a part of the sale proceeds of the flat. The assessee, of course, denied a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... atement of Shri Mirchandani was not at all reliable and was absolutely untrue. Certain alleged discrepancies were pointed out in the statement dated 27-3-1978 of Shri Mirchandani before the ITO. It was pointed out that Shri Mirchandani had no evidence whatsoever in support of his claim of paying such a huge amount of Rs. 68,000 to the assessee in cash. At one stage, Shri Mirchandani had stated that the amount was paid in the presence of Shri Dhaimade, a representative of the buyer, Batliboi Co. ; but Shri Dhaimade had not corroborated this allegation of Shri Mirchandani. It is true that there were entries in the books of Bhagwandas Sons showing as if they paid a sum of Rs. 68,000 to the assessee, but it was urged by the assessee that mere entries in the books regarding the payments, were not sufficient, as there was no guarantee that the entries were genuine, vide decision in the case of Addl. CIT v. Lata Mangeshkar [1974] 97 ITR 696 (Bom.). Further, It was point out that the same brokers had alleged similar cash payments, without receipt, over and above the regular cheque payments in respect of two other flats negotiated and sold on behalf of Amalgamated Construction Co. The I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... essee in cash. The buyer of the flat has also stated that the amount was paid by him to the broker as part of the sale-proceeds. Further, the commission of 2 per cent paid by buyer to the broker showed that the amount of commission was calculated on Rs. 2,25,000 plus Rs. 68,000. Hence, be urged that the decision of the Commissioner (Appeals) deserved to be vacated and that of the ITO deserved to be restored. Shri Anil Harish, the learned representative for the assessee, on the other hand, supported the order of the Commissioner (Appeals). In addition to the arguments already recorded by the Commissioner (Appeals), he drew our attention to the decision dated 16-6-1980 of the Tribunal in IT Appeal No. 1529 (Bom.) of 1977-78, wherein, an issue similar to the one now under consideration was considered and decided in favour of the assessee. More particularly, it was decided in that case that the right to occupy the flat is bought by the person on the date of agreement to buy it and not on the day on which the flat was occupied. He also referred to the decision of the Bombay High Court in the case of CIT v. Tata Services Ltd. [1980] 122 ITR 594 for the proposition that the right to occup ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s have actually paid the money to the broker, then Shri Anil Harish contended that the said money never reached the hands of the assessee at all. He stated that there was no evidence to support such a conclusion. The only evidence on which the ITO has jumped to this conclusion was that the broker had said that the amount he admittedly got from the buyers was handed over to the assessee and that certain entries were made in the books of the brokers to that effect. He stated that these evidences are not enough to hold the assessee responsible for the receipt of the money, when in fact the assessee had received none. He also pointed to the fact that certain other flats in the same buildings were sold to other parties and the sale proceeds shown by the assessee appears very favourable when compared with those sales and so, there was no scope for assuming that the assessee must have received something over and above the very fair sale-proceeds declared by him. He pointed out such other sales to be of Rs. 1,86,000 on 27-12-1975, Rs. 2,02,000 on 21-8-1976 and Rs. 2,01,251 on 23-6-1977---all for identical flats in the same building 'Cuffe Castle'. Hence, he urged that the conclusion arrive ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d that the assessee has received Rs. 68,000 over and above the declared consideration of Rs. 2,25,000 on the basis of the bare statement of the broker and the entries made in his books of accounts. Both these pieces of evidence are self-serving ones as they serve the interests of the broker only. There is no other evidence to corroborate the same. We find no evidence on record to substantiate the theory that the assessee in fact received the sum of Rs. 68,000 under consideration. There is enough force on the other circumstantial evidence pointing to the contrary as explained on behalf of the assessee. Similar statements of this very broker have been found to be untrue in other cases. The sale proceeds declared by the assessee are more than the amounts considered fair by the income-tax department. Again, the broker, having falsely stated that the sum of Rs. 68,000 formed a part of the sale-proceeds had to charge the commission of 2 per cent on that sum also as, otherwise, his action would obviously arouse suspicion. However, that fact in itself does not show that the said sum of Rs. 68,000 was passed on by the broker to the assessee. Under the circumstances, we agree with the Commis ..... X X X X Extracts X X X X X X X X Extracts X X X X
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