Subhash Chand Jain vs Income Tax Officer Ward 29(1)

PER VIKAS AWASTHY, JUDICIAL MEMBER:

This appeal by the assessee is directed against the order of Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi [in short ‘the CIT(A)’] dated 20.01.2026, for Assessment Year 2012-13.

Shri Suresh Anand, appearing on behalf of the assessee submits that the assessment for AY 2012-13 in the case of assessee was reopened on the ground as the assessee along with other co-owners had purchased immovable property for a total consideration of Rs.1,70,00,000/- during Financial Year 2011-12. The assessee was having one fourth share (that is, to the extent of Rs. 42.50 lakhs) in the said immovable property. During the course of assessment, the assessee explained the source of funds for purchasing the property, and had also furnished relevant documents to substantiate his contention. The documents furnished by the assessee were not considered by the Assessing Officer (AO) and the CIT(A). In fact, the AO recorded that no information was received from the assessee. The Id. AR furnished copy of acknowledgment dated 19.11.2019, 08.12.2019 and 09.12.2019 vide which documents were furnished by the assessee during assessment proceedings. The ld. AR contended that the AO without considering the documents passed the assessment order making addition of Rs.42,50,000/-. The ld. AR referred to the confirmation from Unialmaz Jaipur at page 36 of the paper book and bank statement at page 37 of the paper book to show that Rs.2,00,000/- was received by the assessee from Unialmaz Jaipur i.e. the partnership firm of the assessee. The ld. AR further referred to confirmation from Dhaval Jain and the bank statement of Dhaval Jain indicating an amount of Rs.5,00,000/- received from Dhaval Jain, son of the assessee. Further, the ld. AR of the assessee has drawn the attention of the Bench towards bank statement of Subhash Chand & Sons, HUF of the assessee from where the assessee has taken an amount of Rs.29,00,000/-. The ld. AR further submitted that an amount of Rs.10,11,000/-was received from Shri Amit Jain, an unrelated party. The said amount is refund of loan along with interest. The assessee had advanced loan of Rs.10,00,000/- to Amit Jain on 31.05.2011 and the loan amount was received back with interest on 20.06.2011. The ld. AR thus prayed for deleting the addition.

Per contra, Shri Nirmal Nangia, representing the department vehemently defended the impugned order. The ld. DR placing reliance on findings of the CIT(A) and the AO prayed for dismissing appeal of the assessee.

Both sides heard, orders of the lower authorities examined. The assessee had purchased an immovable property during FY 2011-12 with an investment of Rs.42.50 lakhs. During the course of assessment proceedings, the assessee explained source of funds for the said investment as under:-

In order to substantiate source of funds, the assessee has placed on record bank statements, confirmations and ITRs. Unialmaz Jaipur is the partnership firm, wherein the assessee is a partner, Dhaval Jain is the son of assessee, Subhash Chand & Sons HUF is the HUF of assessee and Amit Jain is an independent third party un-related to the assessee. A perusal of the impugned order reveals that the documents furnished by the assessee in support of his contentions were not considered and addition of Rs.42,50,000/- was made. Taking into consideration entire facts of the case, the addition of Rs.42,50,000/- is directed to be deleted. The assessee has been able to discharge his onus in proving the source of funds.

In the result, impugned order is set aside and appeal of the assessee is allowed.