The court ruled that the initial burden of proof regarding cash credits was discharged by the assessee, and the addition under Section 68 was not sustainable, while also addressing the tolerance limit for property valuation under Section 56.

ORDER

PER: RATHOD KAMLESH JAYANTBHAI, AM

By way of the present appeal the assessee challenges the order of the learned National Faceless Appeal Centre [ for short (NFAC)/CIT(A) ] dated 25-04-2024 for the assessment year 2014-15. That order was passed because the assessee challenges the order of the assessment by filling an appeal. The order of the assessment was passed 26.12.2016 by Income Tax Officer, Ward 7(4), Jaipur [ for short AO ] as per provision of section 143(3) of the Income Tax Act [ for short Act ].

2. In the present appeal the assessee has raised following grounds of appeal :

1. The impugned order u/s 143(3) dated 26.12.2016 is bad in law and on facts of the case, for want of jurisdiction and various other reasons and hence the same kindly be quashed.

2. Rs. 2,56,03,777/- (wrongly typed as Rs.2,58,03,777/-): The ld. CIT (A) erred in law as well as on the facts of the case in confirming the addition made of Rs. 2,56,03,777/- u/s 68 of the Act on account of increase in capital. The impugned addition so made and confirmed, being totally contrary to the provisions of law and facts of the case, kindly be deleted in full.

3. Rs. 15,32,337/-: The ld. CIT(A) erred in law as well as on the facts of the case in confirming the addition made of Rs. 15,32,337/- u/s 56(2)(vii)(b)(i) of the Act alleging that total purchase consideration of the properties is less as compared to the DLC value as income from other sources. The impugned addition so made and confirmed, being totally contrary to the provisions of law and facts of the case, kindly be deleted in full.

4. Rs. 38,76,456/-: The ld. CIT(A) erred in law as well as on the facts of the case in confirming the addition made of Rs. 38,76,456/-on account of agricultural income declared initially ignoring the fact and legal position that the same was declared at NIL in the revised ROI and without bringing any evidence on record to show that there was an undisclosed income, making of the impugned addition and confirmation thereof, being totally contrary to the provisions of law and facts of the case, kindly be deleted in full.

5. The ld. CIT(A) erred in law as well as on the facts of the case in charging interest u/s 234A, 234B, 234C & 234D of the Act. The appellant totally denies it liability of charging of any such interest. The interest, so charged, being contrary to the provisions of law and facts, kindly be deleted in full.

6. The appellant prays your honor to add, amend or alter any of the grounds of the appeal on or before the date of hearing.

3. The brief facts related to the disputes are that the assessee efiled return of income on 30.03.2015 declaring total income of Rs. 2,05,280/- and agricultural income of Rs. 38,76,456/- which was included for rate purposes. The case of was selected for limited scrutiny though CASS. After issuance of notice u/s. 143(2) of the Act on 31.08.2015, the assessee filed revised return of income on 30.03.2016 declaring total income of Rs. 2,05,280/- and Nil agricultural income. Ld. AO noted that the revised return of income filed by the assessee was not a valid return of income as the original return of income was not filed as per the provisions of section 139(1) of the Act and therefore, he considered the revised return of income as a further information filed by the assessee.

3.1 Ld. AO noted that the assessee has shown total fixed assets of Rs. 2,85,69,394/- and current assets of Rs. 6,60,049/- as compared to fixed assets of Rs. 18,60,416/- and current assets of Rs. 17,79,337/- shown in the immediate preceding year. Therefore, there was an addition of Rs. 2,55,89,690 in the fixed assets and currents assets in the year under consideration. Regarding the source in the original return of income assessee claimed secure loan of Rs. 9,74,848/- and unsecured loan of Rs. 1,68,00,000/-, agricultural income of Rs. 38,76,456/- and capital of Rs. 42,44,387/-. Whereas in the revised balance sheet filed during the year under consideration the assessee claimed receip