Chameli Devi Vs ITO (ITAT Jaipur)
On-money allegation based only on photocopy of agreement – ITAT partly deletes addition, sustains only advance paid in year
Assessee’s case was reopened u/s 147 based on a photocopy of an unregistered agreement to sell dated 02.03.2012, alleging that she purchased a flat for ₹30,25,000, including ₹5,00,000 cash & balance ₹25,25,000 within two months. However, the registered sale deed dated 06.07.2012 showed the sale price as ₹16,00,000, out of which ₹4,75,000 was paid in cash on 10.03.2012 & the balance ₹11,25,000 was paid by cheques in June–July 2012 (falling in next AY).
AO treated the difference of ₹14,25,000 as on-money, & also held that the cash advance of ₹5,00,000 (as per photocopy) was unexplained. Total addition u/s 69A of ₹19,00,000 was made, along with ₹60,000 disallowed u/s 80C, & ₹2,04,256 treated as unexplained investment in FDRs.
CIT(A) upheld all additions.
Before ITAT, Assessee argued that:
- The photocopy of agreement had no evidentiary value,
- The registered deed did not even mention any prior agreement,
- Most payments (₹11.25 lakh) were made in next year, so cannot be taxed in AY 2012-13,
- Source of cash advance of ₹4.75 lakh was claimed from earlier bank withdrawal, but continuity was not proved.
Tribunal held:
- A photocopy of agreement cannot be relied upon without examining original or witnesses.
- Registered sale deed is the primary document, & it does not mention any agreement to sell.
- Therefore, no addition can be made on the basis of unverified agreement.
- ₹11,25,000 was paid in next year, hence cannot be taxed in AY 2012-13.
- However, assessee failed to prove source of ₹4,75,000 cash paid on 10.03.2012 as per registered deed.
Accordingly:
- Addition of ₹19,00,000 restricted to ₹4,75,000 only.
- Balance ₹14,25,000 deleted.
Other Additions:
- ₹60,000 u/s 80C – Deleted, as FDR maturity was reinvested (supported by HDFC bank letter).
- ₹2,04,256 FDR investment – Deleted, supported by SBI certificates showing reinvestment of tax-saving bonds.
FULL TEXT OF THE ORDER OF ITAT JAIPUR
