TaxTMI 
TaxTMI 
TaxTMI 
2015 (3) TMI 640
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....sclosed undisclosed income of Rs. 41,102/-. Assessment was thereafter framed u/s. 158BD of the Act vide order dated 31.10.2002 and the total undisclosed income was determined at Rs. 1,12,69,955/-. Aggrieved by the order of A.O., Assessee carried the matter before CIT(A) and thereafter before Hon'ble Tribunal. Hon'ble Tribunal vide order dated 12.10.2012 passed in IT(SS)A No. 169 & 222/AHD/2003 allowed the appeal of the Assessee and remitted the matter back to the file of CIT(A) and directed him to decide the issue with respect to validity of notice issued u/s. 158BD of the Act. Tribunal also allowed the appeal preferred by Revenue in appeal no. 222/A/2003. Aggrieved by the order of Tribunal, Assessee carried the matter before Hon'ble Gujarat High Court. Gujarat High Court in Tax Appeal No. 386 & 559/A/2013 order dated 24.09.2013 quashed the orders passed by Tribunal and set aside both the appeals to Tribunal and directed the Tribunal to decide and dispose of the appeals in accordance with law and on merits inclusive of additional ground of validity of notice issued u/s. 158BD of the Act. Thus the present appeals are now before us in 2nd ground. The grounds raised by the Assessee re....
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....erty, to the final recipient Ambica Timber Depot, M/s. Ambica Timber Mart and M/s. Decent Sales, as stated by Mr. Bharat J. Shah, partner of the Appellant firm in his statement on oath. (iv) The alleged amount of Rs. 94,979/- passed on to M/s. Ambica Timber Depot, M/s. Ambica Timber Mart and M/s. Decent Sales and accepted by them and taxed in their hands is neither the expenditure of the Appellant firm nor its investment as no asset has been created in the hands of the Appellant firm. 4. Without prejudice to what is stated in the aforesaid Ground of Appeal No. 3, the learned CIT(A) ought to have restricted the addition to Rs. 9,498/- being 1.0% supervision charges, of the alleged cash payment of Rs. 94,979/-, to which the Appellant firm is entitled to by virtue of the agreement between the society and the Appellant firm as developer. 5. The Appellant firm requests the Hon'ble Income Tax Appellate Tribunal to delete the following additions aggregating to Rs. 3,46,498/- erroneously confirmed by the learned CIT(A): (i) Rs. 2,51,519/- amount passed on to M/s. Raj Granite (ii) Rs. 94,979/- amount passed on to M/s. Ambica Timber Mart; M/s. Ambica Timber Depot and M/s. Decent Sal....
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.... take up Assessee's appeal in IT(SS)A No. 169/AHD/2003. 6. Before us, with respect to additional ground whereby Assessee has challenged the validity of assessment, ld. A.R. submitted that notice u/s 158BD of the Act was issued to the Assessee on 18.10.2000 calling upon the Assessee to file return for the block period. It was submitted by ld. A.R. that Assessee had applied under RTI Act and sought information about the copy of the satisfaction recorded by the A.O of the searched person on the basis of documents seized which was forwarded to the A.O of the Assessee. She submitted that DCIT Circle-9 vide reply dated 14.03.2012 has stated that the copy of the satisfaction recorded was not forwarded to Circle-9 and therefore it was unable to provide the required information. On the basis of the aforesaid reply she submitted that no satisfaction as required under the Act was recorded. She further submitted that for making assessment u/s 158BD, the condition precedent are (i) satisfaction must be recorded by the A.O that any undisclosed income belongings to any person other than the person with respect to whom search was made u/s 132 of the Act and (ii) the books of accounts or other doc....
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....he Assessing Officer either at the time of initiating proceedings for completion of assessment of a searched person u/s. 158BC of the Act or during the stage of assessment proceedings. It does not mean that after completion of the assessment, the Assessing Officer cannot prepare the satisfaction note to the effect that their exists Income Tax belonging to any person other than the searched persons in respect of whom the search was made u/s. 132 or requisition of books of accounts were made u/s. 132A of the Act. The ld. D.R. further pointed that Hon'ble Apex Court has further held that the legislature has not imposed any embargo on the Assessing Officer in respect of the stage of proceedings during which the satisfaction is to be reached and recorded in respect of the person other than the searched person. Further he pointed at para 44 of the aforesaid order where the Hon'ble Apex Court has held that for the purpose of Section 158BD of the Act is satisfaction note is sine qua non and must be prepared by the Assessing Officer before he transmits the records to the other Assessing Officer who has jurisdiction over such other person. The satisfaction note could be prepared at either of....
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.... letter it is further submitted that the reasons recorded by the A.O are on records and can be given to the Assessee at any time. Considering the aforesaid facts and in the light of the decision of Hon'ble Apex Court in the case of Calcutta Knitwears (supra), we are of the view that in the present case the A.O had recorded the satisfaction as required under the Act and therefore the assessment framed was valid and thus this ground is dismissed. All the other grounds raised by Assessee are considered together as they pertain to the additions made by the AO. 9. During the course of search, it was noticed that cash payment of Rs. 2,51,519/- was made to Raj Granite and Marble Industries for purchase of Marble cash of Rs. 3,93,689 was made to Ambica Timber Mart and Ambica Timber Depot and Rs. 17,647 was made Decent Sales Corporation over and above the regular payment made by cheque. A.O also noted that the partner of the Assessee firm in his statement has admitted to have made the payments partly by cheque and partly in cash and the cash payments were not shown in the books of accounts. A.O also noted that in the case of Raj Granite and Marble Industries against the addition of an amo....
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....M/s. Ambica Timber, the A.O will work out the addition as directed above. 10.Aggrieved by the order of CIT(A), Assessee is now in appeal before us. 11.Before us, ld. A.R. reiterated the submissions made before A.O and CIT(A). On the other hand ld. D.R. supported the order of lower authorities. 12.We have heard the rival submissions and perused the material on record. We find that ld. CIT(A) while deciding the issue has concluded that the cash payments were made by the Assessee and were not recorded in the books of account and further as the source of payment was unexplained, the cash payments represents unexplained expenditure. Before us, no material has been placed on record by ld. A.R. to controvert the findings of CIT(A). We therefore find no reason to interfere with the order of CIT(A). Thus the grounds are dismissed. 13.In the result, the appeal of Assessee is dismissed. IT(SS)A No. 222/AHD/2003 Revenue's appeal 1st ground is with respect to deletion of addition of Rs. 27,50,000/- on account of settlements of unaccounted cash loan. 14.During the course of assessment proceedings, on the basis of documents seized, A.O noticed that 5 flats were allotted to the family of Sh....
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.... 38,12,100/-. Aggrieved by the order of A.O, Assessee carried the matter before CIT(A) who deleted the addition by holding as under:- The ld. Authorized representative pointed out that these papers were seized from the premises of Janak K. Kansara and he was the only person responsible for these items. Besides thus it was argued that payment was made by these persons for investment in their respective properties and as such even if it is presumed that money was received appellant would be liable to tax on only profit part of it and not the entire receipts. Finally the ld. Authorized representative pointed jout that the same amount was also added in the hands of Janak K. Kansara, and these amounts have been accepted in that case as being received by him. Hence the amount should not be added again in appellant's hand. I have carefully considered the submissions and I have noticed that addition of these amounts were also made in block assessment of Shri Janak K. Kansara because the relevant papers were found from his premises and it was his primary responsibility to explain this. It is also seen that these addition have been accepted by Shri Kansara as pertaining to him and addition h....
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....struction expenses pertain to the society and not the appellant. Hence the addition is deleted. 23.Aggrieved by the order of CIT(A), Revenue is now in appeal before us. 24.Before us, ld. D.R. supported the order of A.O. On the other hand ld. A.R. reiterated the submissions made before ld. CIT(A). 25.We have heard the rival submissions and perused the material on record. We find that CIT(A) while deleting the addition has given a finding that the properties were not owned by the family member of Kansara Group and further the construction expense pertains to the Society and not of the Assessee. He accordingly deleted the addition. Before us, no material has been brought on record by Revenue to controvert the findings of CIT(A) and thus this ground of Revenue is dismissed. Ground no. 4 is with respect to deletion of addition of Rs. 3,40,000/- on account of unexplained cash credit. 26.A.O noticed that cash credit in the name of Smt. Varshaben Kansara of Rs. 3,40,000/- was appearing in the books of the Assessee. In the absence of any satisfactory documentary evidence to prove the genuineness of deposits, A.O considered the cash credit as unexplained and added to the income. Aggrieve....