- (1.) This is an appeal under Section 260A of the Income Tax Act, 1961 (for brevity 'the IT Act') against the order dated 27.07.2011 (Annexure A-6) passed by the Income Tax Appellate Tribunal, Chandigarh Bench 'A' (ITAT) for the assessment year 2002-03 and the order dated 15.02.2010 (Annexure 'A-5') of the CIT (Appeals), Chandigarh deciding appeal against the assessment order dated 29.12.2008 (Annexure 'A-4'). The background of this appeal may be briefly stated: The appellant-assessee had shown advance of Rs. 2,50,000/- against the land in his capital account for the relevant assessment year. He claimed that this was on account of forfeiture of the earnest money amounting to Rs. 2,50,000/-, for sale of his plot No. 137, Sector 1, Ambala, received on 25.02.2002 vide payees demand draft (DD) No. 625557 dated 22.02.2002 of State Bank of Patiala, Delhi (SBOP). The DD was later on found to be issued by Jai Laxmi Cooperative Bank Ltd., Fatehpuri, Delhi (for short described as 'Bank') through State Bank of Indore, Chandni Chowk. The copy of agreement for sale of plot produced by the appellant was entered into with one Leela Dhar Gupta son of Chandgi Ram of Delhi on 22.02.2002. The Assessing Officer (AO) held an enquiry into the matter and found this entry of Rs. 2,50,000/- to be fake and held it as undisclosed income routed by the appellant, in this manner. Addition of Rs. 2,50,000/- therefore, was made in the income of the appellant for the assessment year in question. It was further proposed to initiate penalty proceedings under Section 271(1)(c) of the IT Act vide order dated 24.03.2005 (Annexure A-1).
(2.) The appellant preferred appeal before CIT (Appeals) and filed certain documents to justify the entry of Rs. 2,50,000/- in his capital account. The Appellate Authority called for the remand report from AO. On examination of remand report and the proceedings conducted by AO, the appeal was dismissed vide order dated 09.12.2005 (Annexure A-2). The order of authorities below was challenged before ITAT and it was contended that the Department might have contacted another Leela Dhar whereas the appellant was in a position to produce the said person even now. In view of these facts, the Tribunal formed an opinion that one more opportunity be provided to the appellant-assessee to produce Leela Dhar Gupta before AO, who was directed to examine whether Leela Dhar Gupta was an existing person or not and to satisfy himself about the genuineness of the transaction. The matter was remitted to AO for fresh adjudication vide order of ITAT dated 05.07.2007 (Annexure A-3) with a direction that due opportunity be given to the appellant-assessee, who was also at liberty to produce evidence, if any, to substantiate his plea.
(3.) It may be noted that there was another addition under the head agricultural income, but on that matter the appellant's contention was allowed by the Tribunal.;