Brijesh Sharma Vs DCIT (ITAT Jaipur)
During the Assessment assessee submitted to the AO vide letter dated 12.11.2014 that the assessee had purchased a plot of land situated in Jaipur for disclosed consideration of Rs. 5,21,000/- which was paid by cheque. The AO issued summon u/s 131(2) the seller, Smt. Choti Devi. In her statement recorded on oath u/s 131 before AO on 07.01.2015, she stated that the said plot was sold by her to the assessee for a consideration of Rs. 12,21,000/- out of which, Rs. 5,21,000/- was received through cheque and Rs. 7,00,000/- through cash.
The cash amount of Rs. 7,00,000/- was found credited in the bank account of Smt. Choti Devi on 01.10.2011. The copy of statement of the seller was provided to the assessee. In response, the assessee admitted to have made total payment of Rs. 12,21,000/- including cash of Rs. 7,00,000/-.
The assessee explained that a dispute arose with the seller after the agreement and cash of Rs. 7,00,000/- was paid in settlement as the seller was not ready to handover the physical possession of the plot. The assessee submitted copy of relevant agreement dated 11.01.2012 to the AO.
The AO observed that the agreement was executed between the appellant and Smt. Choti Devi on 11.01.2012 which showed consideration of Rs. 5,21,000/- being paid by cheque dated 13.01.2012. However, the cash deposit in the bank account of Smt. Choti Devi was made on 01.10.2021. In her statement recorded 131, Smt. Choti Devi had confirmed that the said cash was given by Shri Brijesh Sharma on 01.10.2011.
The AO noted that cash was given by the assessee on 01.10.2011 much before the date of agreement executed on 11.01.2012. It was, therefore not possible that cash was paid before the date of agreement to resolve the dispute as the assessee had earlier submitted that the dispute had arisen after the agreement. The AO therefore, concluded that the payment of Rs. 7,00,000/- was made out of the undisclosed income and added the same.
FULL TEXT OF THE ORDER OF ITAT JAIPUR
This appeal by the assessee is directed against the order of the Learned Commissioner of Income Tax (Appeals) [hereinafter referred to as ld. CIT(A)]-42, Delhi dated 18.01.2022 for the AY 2012-13.
2. The assessee has raised the following grounds:-
“1. Ld. Assessing Officer (i.e. Dy. Commissioner of Income Tax, International Taxation, Jaipur) lacked the valid jurisdiction to issue notice, conduct proceedings and pass assessment order as no order u/s 127 was passed by competent authority (Principal Commissioner/Director General) to transfer jurisdiction from Dy. Direction of Income Tax, Circle-1(1), New Delhi. Even if both of the Assessing Officer may be falling under the jurisdiction of same PCIT/DG or the transfer is on request of assessee, the legal necessity of passing the transfer order u/s 127 cannot be foregone. No such procedure has been followed by department as confirmed by the Ld. AO and also upheld by Ld. CIT(A) Ground on merit.
2. That the Ld. Assessing Officer has erred in making the addition of Rs. 700000/- u/s 69C because: a) Expense was never a ‘unexplained expenditure’, due to the fact that assessee had already explained the nature of expenditure and source thereof on.”
3. Brief facts of the case are that assessee is an NRI, who was a resident of Hongkong, decided to shift to India along with his family. The assessee filed his return of income for assessment year 2012-13 on 27.07.2012 declaring total income of Rs. 1,55,660/-. The return of income was processed u/s 143(1) and was picked up for scrutiny by issuing notice u/s 143(2) of the I.T. Act, 1961 on 12.08.2013. Account of change of jurisdiction a fresh notice u/s 143(2) of the Act was issued on 20.10.2014 which was duly served upon the assessee. During the Assessment assessee submitted to the AO vide letter dated 12.11.2014 that the assessee had purchased a plot of land situated in Jaipur for disclosed consideration of Rs. 5,21,000/- which was paid by cheque. The AO issued summon u/s 131(2) the seller, Smt. Choti Devi. In her statement recorded on oath u/s 131 before AO on 07.01.2015, she stated that the said plot was sold by her to the assessee for a consideration of Rs. 12,21,000/- out of which, Rs. 5,21,000/- was received through cheque and Rs. 7,00,000/- through cash. The cash amount of Rs. 7,00,000/- was found credited in the bank account of Smt. Choti Devi on 01.10.2011. The copy of statement of the seller was provided to the assessee. In response, the assessee admitted to have made total payment of Rs. 12,21,000/- including cash of Rs. 7,00,000/-. The assessee explained that a dispute arose with the seller after the agreement and cash of Rs. 7,00,000/- was paid in settlement as the seller was not ready to handover the physical possession of the plot. The assessee submitted copy of relevant agreement dated 11.01.2012 to the AO. The AO observed that the agreement was executed between the appellant and Smt. Choti Devi on 11.01.2012 which showed consideration of Rs. 5,21,000/- being paid by cheque dated 13.01.2012. However, the cash deposit in the bank account of Smt. Choti Devi was made on 01.10.2021. In her statement recorded 131, Smt. Choti Devi had confirmed that the said cash was given by Shri Brijesh Sharma on 01.10.2011. The AO noted that cash was given by the assessee on 01.10.2011 much before the date of agreement executed on 11.01.2012. It was, therefore not possible that cash was paid before the date of agreement to resolve the dispute as the assessee had earlier submitted that the dispute had arisen after the agreement. The AO therefore, concluded that the payment of Rs. 7,00,000/- was made out of the undisclosed income and added the same. Aggrieved with the assessment, the assessee has filed this appeal.
4. The AO arrived the finding that it is clear that the assessee must be residing outside India and must be NRI which is not case of the assessee. Hence, I do not find any merit in the submission of the assessee.
With these remarks the total taxable income of the assessee is recomputed as
