TaxTMI 
TaxTMI 
2003 (12) TMI 283
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....y. CIT, Investigation Circle, Dehradun, hereinafter referred to as Dy. CIT. In compliance with the said notice the assessee filed a return in the prescribed form on 3rd March, 2000 before the Dy. CIT. In the return so filed by the assessee, the income was shown at Nil. After extensive inquiries, although covering a very short span, the block assessment order dt. 29th March, 2001, was passed. In terms of the said order the undisclosed income was determined at Rs. 1,65,35,579 made up as under: (a) Rs. 20,00,000 on account of gifts received from NRE account standing in the name of Shri Mahendra Singh on the ground that relevant information about the gift could not be furnished and the gift deed did not appear to be genuine. (b) Rs. 3,44,775 on account of investment in construction of house, said to have been understated by the appellant at the original assessment stage, as based on the report of Valuation Cell, which is said to have been obtained on 20th March, 2001. (c) Rs. 10,11,855 on account of capital gain arising out of sale of shares (which stood already disclosed in the income-tax return for the asst. yr. 1992-93). (d) Rs. 23,75,000 on accou....
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....and the submission of Shri Y.B.P. Singh, the Departmental Representative, who was present before the CIT(A) during the course of hearing of appeal. 4.1 The CIT(A) after considering the submissions of both sides and after perusing the material on record, along with written submissions and remand report of the AO, allowed the appeal of the assessee in part. Some of the additions were reduced and some of the additions were deleted by CIT(A). The Department is in appeal against reducing/deleting the additions fully. The assessee is in appeal against the finding of CIT(A) by which some of the additions were reduced or sustained. 5. The learned counsel has relied upon the submissions filed before the CIT(A). On the other hand, the learned Departmental Representative has placed strong reliance on the order of AO and on the order of CIT(A) to the extent to which the additions were sustained. 6. We will take first the assessee's appeal. 7. Ground No. 1 in assessee's appeal against upholding the addition of Rs. 38,312 on account of income from dealing in property was not pressed by the counsel of the assessee during the course of hearing. Therefore, the same is dismissed as not p....
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....f seized material from p. 58 to p. 62 of Annex. A-4 seized from the office of Saharanpur Associates on 13th Oct., 1998. Since Shri Rakesh Goyal has withdrawn from the group as stated by him under s. 132(4) of IT Act on the date of search, the claim of Mr. Rakesh Goyal that he has invested only Rs. 11.5 lakhs in Saharanpur Associates is, therefore, false. If this being the case, the Saharanpur Associates had no reason to return back the sum of Rs. 13.5 lakhs as discussed above, as is evidenced from the balance sheet at p. 127 of Annex. A-4 of the seized documents from Saharanpur Associates. The reply of the assessee vide letter dt. 14th March, 2001 in response to this office query dt. 9th March, 2001 has been considered and is not found to be tenable. The investment of Shri Rakesh Goyal was exactly Rs. 26.75 lakhs, the evidence of which is available in the seized material of Saharanpur Associates as already discussed. Shri Rakesh Goyal could not produce any documentary evidence in support of his claim regarding the extent of investment to be only Rs. 11.5 lakhs. Since Rs. 3 lakhs have been shown by Shri Rakesh Goyal to be out of amount of Patni Chemicals by way of draft, the remaini....
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....efore, rightly made under s. 69 of the IT Act, 1961 in the case of the appellant-assessee by treating the sum of Rs. 15.25 lakhs as income from undisclosed sources. I, therefore, confirm the addition to the tune of Rs. 15.25 lakhs out of the addition made as unexplained investment under s. 69 of the IT Act, 1961." 9.1 After considering the submissions and perusing other material on record, we noted that search was also conducted in case of Saharanpur Associates and it was noted there that credit entry of Rs. 26,75,000 was in the name of the assessee. Out of this credit entry of Rs. 26,75,000 a sum of Rs. 3 lakhs has been explained by assessee, as the same was made after withdrawal from Patni Chemicals Ltd. The remaining amount was held by the AO as unexplained. The CIT(A) noted that the assessee had paid a further amount of Rs. 8.5 lakhs out of savings bank a/c No. 14718 with Oriental Bank of Commerce, Saharanpur and the same was duly disclosed in the income-tax return year after year. Accordingly to this extent the addition was deleted and the remaining amount was held as unexplained. 9.2 The counsel of the assessee has stated that neither the assessee was partner during the....
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....ccount of investment in household appliances. The AO has made addition of Rs. 2 lakhs on account of household appliances. The CIT(A) has reduced the addition to Rs. one lakh. This is undisputed fact that inventory of household appliances were prepared during the course of search and assessee could not explain the items purchased during the block period properly. Therefore, we are not inclined to interfere in the findings of CIT(A), who sustained an addition of Rs. one lakh as against Rs. 2 lakh addition made by the AO. Accordingly the order of the CIT(A) is confirmed on this issue. 11. Next issue, i.e., ground No. 5 is against the sustenance of addition of Rs. 45,000 on account of expenses incurred by assessee on foreign tour. The total addition was made by the AO at Rs. 99,000. In fact, the AO made addition by observing that cost of stay at abroad for 18 days estimated at Rs. 72,000 and cost of air ticket estimated at Rs. 50,000 and after allowing the benefit of withdrawals shown from Patni Chemicals of Rs. 23,000, the remaining amount of Rs. 99,000 was added by the AO as unexplained expenditure on foreign visit. The CIT(A) after ascertaining the fact that the expenses on stay ....
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....le of shares was duly shown during asst. yr. 1992-93 while filing the regular return. Therefore, on the reasoning given while deleting the addition of Rs. 20 lakhs, this addition was also deleted. 15.1 Here also we do not find any infirmity in the finding of CIT(A), as the assessee has already disclosed all the facts relating to capital gain on account of sale of shares during asst. yr. 1992-93 while filing its regular return. 16. Ground No. 3, which relates to deleting the addition of Rs. 8,50,000 out of total addition of Rs. 23,75,000, this issue we have already dealt with while disposing the ground of appeal, where the CIT(A) has sustained the addition of Rs. 15,25,000. We have already deleted the addition of Rs. 15,25,000 by holding that no addition can be made in the hands of the assessee, as nothing was brought on record which could have established that assessee has made deposit with Saharanpur Associates of Rs. 15,25,000. A sum of Rs. 8,50,000 was advanced by assessee out of his bank account and the same was disclosed by assessee while filing his regular return of income. Therefore, there was no point in making any addition while completing the assessment under s. 158....
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....paras 41 and 42 of his order are as under: "41. The evidence of irrefutable nature as discussed herein force, cannot be ignored merely because the lady has applied ignorance with regard to the said material/information. Shri Y.P.B. Singh did not also rebut the said evidences. He merely relied on the statement of the lady, which has already been held by me, cannot go to substitute the documentary evidences available in seized material in support of the declaration under VDIS having been made by her and enjoyment of proceeds of jewellery (covered by VDIS 1997 in her own name). 42. On a consideration of the totality of facts and circumstances of the case, I have no option but to delete this addition of Rs. 18,57,038. The appellant gets a relief of Rs. 18,57,038." 18.2 After considering the above finding of CIT(A) and the order of the AO, we do not find any infirmity in the findings of the CIT(A), as findings of the CIT(A) neither could be controverted nor any material was brought on record as to how the jewellery disclosed under VDIS was bogus. Therefore, in view of the reasoning given by the CIT(A), we confirm his order on this issue also. 19. Ground No. 6 is ....
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....& Co. Ltd. (1998) 145 CTR (SC) 384 : (1998) 230 ITR 580 (SC); 66 TTJ 139 (sic), Asstt. CIT vs. Shailesh S. Shah (1997) 59 TTJ (Mumbai) 574 : (1997) 63 ITD 153 (Mumbai). After considering the submissions and perusing the order of the AO, the CIT(A) held that this is a deaf and dumb document, therefore, no addition can be made on the basis of these Parchas. Accordingly the additions of Rs. 10 lakh and Rs. 2,75,000 were deleted. The findings of the CIT(A) given in his order in paras 48 to 50, are as under: "48. In reply, Shri Y.P.B. Singh, Asstt. CIT stated as follows: Page No. 25 of Annex. A-26 has been examined by me, total has been made like this 3-30 2-12 5-42 the period has been mentioned from 15.1 to 1.5 with regard to total of Rs. 2,12,800 different amount have been added to each other which total upto Rs. 2,12,800, reg. 3-30, there is no such detail. I have carefully considered the material and information on record as also various case laws as have been referred to and relied upon by the learned counsel for the appellant. From the scrutiny of the paper no inference can be drawn about any investment in moneylending business by the assessee. Practical....
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....h out of addition of Rs. 2 lakhs on account of household expenses and deleting the addition of Rs. 54,000 out of total addition of Rs. 90,000 on account of expenditure on foreign tour by the assessee. For the remaining addition sustained by CIT(A), the assessee also came in appeal before the Tribunal and the ground of appeal of assessee has already been disposed of by us above, while disposing the appeal of the assessee, whereby we have held that the order of the CIT(A) was correct. The grounds of the assessee were dismissed. On the same reasoning we dismiss these grounds of the Department. 22. The remaining issue in appeal of Department is against the deletion of addition of Rs. 67,50,000 made by the AO on account of undisclosed investment in purchase of property Thrill Hotels (P) Ltd. 22.1 The learned Departmental Representative has simply placed reliance on the order of the AO. 22.2 The findings of the CIT(A) are given in his order in pp. 59 to 64, which are as under: "59. During the course of search, a loose paper was found from the possession of Shri Nand Kishore Goel. The said letter gave an impression that the property had been purchased for Rs. 2 crores an....
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....ngruities. In this letter there is some reference of sale and purchase of shares of Thrill Hotel (P) Ltd. for a sum of Rs. 2 crores. There is no material to support the same. The group of Shri Rakesh Goel, the appellant here, has been already having a shareholding to the extent of 62.5 per cent in the beginning. Thereafter they acquired some more shares from Shri Arvind Gupta (another shareholder) and on the date of search, the group as a whole having 90 per cent shares in the said company; 45 per cent belonging to Shri Rakesh Goel and remaining 45 per cent belonging to Shri Naresh Goel (brother of Shri Rakesh Goel). In this statement under s. 132(4) Shri Arvind Gupta has admitted the subsequent sale of shares to Goels and in the said statement he has further stated that the transactions took place on various value of shares. From a combined reading of all the material referred to above, only conclusion that can be drawn, is that Shri Rakesh Goel instead of selling the shares of Thrill Hotel (P) Ltd. had purchased shares from Shri Arvind Gupta and such transactions had nothing to do with purchase of property for which agreement had been entered into on 12th May, 1989. Thus, the sai....