Case Law Details
Assessee as an honest citizen not only made a complaint to the registering authority that the sale deed has been registered at a value much below the amount, which he has actually received, he deposited the entire amount in the bank and voluntarily filed return. There was no material whatsoever or any circumstance, which could have suggested that this amount was received by him from any other source. The deposition of witness of the sale deed, the Bank Manager and the evidence filed with regard to valuation of the property was more than sufficient to discharge the burden, which the A.O. had unreasonably placed on the assessee. The A.O. in disbelieving the evidence has not given any reasons whatsoever to discard the statement of the witnesses, deposit of the entire sale consideration in bank and the deposition of the Bank Manager. The assessee had not only deposited the entire amount in the bank but also informed the registering authority of the deficiency of the stamp in the sale deed.
We further notice the observations made in the order of the Tribunal that in the case of Mohd. Raisuddin, one of the purchaser, the A.O. had accepted that he was the owner of the money i.e. Rs. 97,80,000/- and accordingly addition of Rs.77,80,000/- was made in his hand on substantial basis as his income during the year for which a copy of the assessment order was filed on record.
Before parting with the case we may observe here that from the facts and circumstances on the record that in the present case the Income Tax Officer did not act in bonafide manner. The assessee led substantial evidence to establish that the amount treated to be undisclosed income by the A.O. was the sale consideration of sale of his agricultural land, which he had deposited in the bank and had voluntarily filed return disclosing his income. Overwhelming evidence led by him was discarded without giving any reasons at all. The assessment was framed only on the ipse dixit of the A.O., which gives us reason to believe that he had exceeded his authority with some ill will or with ulterior motive.
We, therefore, find it appropriate to direct the Registrar General of the Court to forward a copy of this judgment to the Chairman of the Central Board of Direct Taxes to cause an inquiry into the conduct and motives of Shri Yaduvansh Yadav, Income Tax Officer, Ward-1, Hapur in framing the assessment and raising demand of income tax against the petitioner.
HIGH COURT OF JUDICATURE AT ALLAHABAD
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The views of ca.Dev Kumar Kothari are fair
The revenue minded overzeal is not uncommon, which even blinds the common sense and fair play. No need to guess that the AO would have made all enquiries about other assets, sources of income and bank accounts in a scrutiny assessment.
In view of corroborative evidences,the honorable Tribunal and honorable High Court have described the assessee/ seller of land as an honest person. However, with due respect, author feels that the fact that assessee signed sale deed which showed just about 1/6th of actual consideration(as alleged by the seller (assessee)) and the amount was claimed to be exempt because the land is rural agricultural land, hence not a ‘capital asset’ for levy of capital gains tax. are relevant factors for consideration by tax authorities. Having declared sale consideration of Rs.20 lakh in sale deed, it can be said that sale consideration was Rs.20 lakh and balance amount was his own money to which he has given colour of sale proceeds of rural agricultural land.
The question which need to be asked is why the seller, as an honest person did not insist upon the buyer to show full amount in the sale deed?
Particularly when there would be no dearth of willing buyers. As the seller himself has stated that value of land has further appreciated many folds. Therefore, the seller could have insisted upon the buyer to mention full amount in the deed in fact he could have denied to register the deed which showed lower amount.
The statement of counsel or assessee that assessee had no other income, has been taken at face value without any further verification of assets , bank accounts, etc. of assessee.
In the given facts there can be situation that assessee had some problems with the buyer of land, and to teach lesson to the buyer and also to introduce black money of his own or some other person he has made out a case of excessive sale consideration received from the buyer.
In this case addition made by the AO was confirmed by the CIT(A). However, the honorable High Court has directed for an enquiry about conduct of the AO only, it can be said that actions of AO (Shri Yaduvansh Yadav, Income Tax Officer, Ward-1, Hapur) in framing the assessment and raising demand of income tax against the petitioner are no longer questionable because CIT(A) has confirmed the assessment order and Assessee had to file appeal before Tribunal. However, in the given circumstances action of CIT(A) could be enquired for the same reasons as considered by the honorable High court. The action of team of IT Department which dealt with scrutiny of order of Tribunal and counsels who recommended filing of appeal before the High Court also deserves an enquiry. Filing of an appeal without proper ground and home work simly causes wastage of public money and valuable time of honorable Courts. This must come to an end.