AI OCR 
TaxTMI 
TaxTMI 
TaxTMI 
2015 (11) TMI 423
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.... stated facts of the case on the first issue are that the AO during assessment proceedings noticed from the Income & Expenditure A/c for the year ended 31/03/2005 filed along with the return of income that the assessee has declared Short Term Capital Gain on sale of shares of Rs. 10,46,418/- and the details of such Short Term Capital Gains was given in the return. The AO issued notice u/s. 133(6) of the act to SSKI Securities Pvt. Limited with whom the assessee had transaction in shares, and it sent the statement of the said SSKI Securities Pvt. Ltd wherein a sum of Rs. 14,01,448.65 paisa was payable by them to the assessee as on 31/03/2004.The AO also noticed the following amounts having been shown by them as receipts by cheques on various dates as mentioned below: 10/05.2004 Rs.6,00,000/- 17/05/2004 Rs.6,00,000/ 21/05/2004 Rs.3,25,000/- Rs.15,25,000/- The assessee was asked to explain the above transactions. In reply to the same the assessee claimed that the said amount is reflected are the corrected balance sheet and P&L A/c. filed on 22/11/2007. But the AO observed from statement of account of UCO Bank, which was a tampered one and some entries were will....
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....or the assessee that the AO has added a sum of Rs. 14,91,449/- on the ground that the balance is not shown in the balance sheet as on 31.03.2004 on the reasoning that there is difference in the photocopy of bank pass book produced by assessee and that of the same was obtained via notice issued u/s 133(6) of the Act. The Bank balance in the balance sheet as on 31.02.2004 is shown as Rs. 15,25,283/- which includes this balance. If AO could have applied his mind with regard to difference in opening balance of SSKI Securities (P) Ltd vis-à-vis difference in opening balance of UCO Bank, the same could have been explained. The ledger copy of Bank account and effect of Bank Reconciliation is enclosed now filed in the assessee's paper book. The difference in opening balance was never brought to the notice of assessee during the course of assessment proceedings. The addition is on account of alleged nondisclosure of the debit balance Rs. 14,91,448/- appearing in the assessee's ledger account in the books of the broker, SSKI Securities Pvt. Ltd. as on 01/04/04. The assessee in her books in the said broker's personal ledger account shows no opening balance of that sum. The ....
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.... by the assessee and the one obtained from the bank) it is seen that the following credit have been willfully suppressed from the original bank statement while submitting the copy of the same: 07/05/2004 Rs.12,00,000.00 10/09/2004 Rs.20,72,715.43 Thus it is clearly evident that the assessee had suppressed certain transactions representing undisclosed investment. The assessee had even tried to suppress the entire credits and investments by submitting a tampered bank statement. Accordingly I make the following additions. Undisclosed investment in SSKI Securities Pvt. Ltd as discussed in Para (1)(ii) Rs.15,25,000.00 Undisclosed Credit in bank a/c as on 10/09/04 as discussed in Para (1)(iii) (I have not considered Rs. 12,00,000/- in the Bank a/c on 7.5.04 as income, since I have Already added Rs. 6,00,000/- and Rs. 6,00,000/- being utilization of the said Rs. 12,00,000/- in the addition of Rs. 15,25,000/-) Rs.20,72,715.43 Aggrieved, assessee preferred appeal before CIT(A). 8. The CIT(A) deleted the addition vide para 4.2.2, 4.3 and 5.1 by observing as under: "4.2.2 I have gone through the Assessment Order, submission of the A/R and the evidences. The AO ha....
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....t appears that this has not been accounted as income. Since the entry is not reflected in the account of the assessee, it is considered as unexplained investment and addition to this extent is sustained. 4.3 This ground of the assessee is partly allowed . 5.1 I have gone through the submission of the A/R and the reason for addition made by the AO. The AO has made the addition not because this entry did not reflect in the Books of A/cs. of the assessee but because the entry did not appear in the segmental or tampered bank a/cs. statement. I am afraid that the said addition can be made only if the entries are not properly reflected in the Books of the assessee. IXT is not material whether these are reflected in the segmental statement or not. The fact is that the receipt of Rs. 20,72,715/- is duly reflected in the actual & complete Bank Statement and also in the ledger account of M/s. SSKI Securities Pvt. Ltd. (Broker) in the Books of the assessee. The contra is reflected in the Ledger A/c of the assessee with M/s./ SSKI Securities Pvt. Ltd. Hence there was no reason for the addition as there is no difference in the Books of assessee and that of the Broker and the transaction is ....
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....receipt on share difference account in the sum of Rs. 3,25,000/- and therefore, also in the net profit in the sum of Rs. 1,66,989/- after set-off of the share difference loss of the year, this is demonstrated from its entry in the ledger account of share difference transactions in the assessee's books. So the addition of Rs. 3,25,000/- as made by the ITO resulted in the same sum being twice included in the income, once by the assessee himself in his profit & loss account and also the profit and gain by the AO as undisclosed sum appearing in the broker's account. So there is no ground for the addition for the mere clerical error in the broker's account. Irrespective of the error, the inexorable fact is that this very sum of Rs. 3,25,000/- forms part of the assessee's revenue receipt entering the profit and loss account. However, the CIT(A) has deleted the addition of Rs. 12 lac but sustained the addition of Rs. 3.25 lac on the reasoning that this Rs. 12 lac has been explained vis-à-vis the original bank pass book of Uco Bank and that the ledger account copy of the assessee's books of account. The CIT(A) confirmed the addition of Rs. 3.25 lac being the prof....
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....ssee's bank account, there is no rhyme or reason for choosing one of them as suspect and liable to addition. Therefore, the allegation of undisclosed credit either of Rs. 12 lakh or Rs. 20,72,715.43 as unaccounted for in the assessee's account is wholly contrary to the evidence on record, the bank statement as well as the bank ledger in the accounts of the assessee showing complete tally inter se, the assessee suo motu filed. The Ledger copy of the Bank account with UCO Bank reflecting the credits is available on record. The AO's oversight of the copy of the said Ledger Account, caused a misapprehension of the assessee's omission to credit the sum of Rs. 20,72,715/-.So it is clear that the AO proceeded for a preconceived notion. For want of circumspection and for non-appreciation due to obsessive suspicion he failed to see that what he condemns as tampered bank account is, in fact, not the entire bank account but contains one parameter of the bank account related to investment in securities meant for correlation of assessee's investment in securities with the force of the money in bank so invested and to prove that the investments are from within the assessee....
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.... of Rule 46A(3) for documents after examination. In the Remand Report it was submitted by the AO that from the documents filed by the assessee it cannot be established that Dr. Ashok Shroff is a relative of the assessee as defined in Sec. 56. Though the AO has not mentioned as to how he has arrived at this conclusion, it is presumed that it is because the US Passport of Sri Ashok Shroff does not mention in the name of the father. In response to the comments of the AO in the Remand Report, the assessee submitted the Birth Certificate of Ashok Shroff issued by the Public Health Deptt. Municipal Corporation of Greater Bombay vide Certificate No. 092379 dated 21/01/88 which clearly shows the name of father as Sri Basudev Shroff and Mother as Chandrakala Shroff. This when read with the Passport of Mr Jayant Shroff which shows the name of father as Sri Basudev Shroff and mother Chandrakala Shroff and spouse as Premlata Shroff, establishes beyond doubt that Dr. Ashok Shroff and Jayant Shroff are brothers and the assessee Premlata Shroff is the wife of Jayant Shroff. Therefore it is established that the donor is the brother-in-law of the assessee and therefore covered by the definition of ....
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.... in the circumstances of the case the Learned CIT(A) has erred in deleting the addition made on account of unexplained investment of Rs. 5,00,000/ since the assessee failed to furnish adequate information regarding the source of investment." 16. The brief facts leading to the above issue are that the AO made an addition of unexplained investment of Rs. 5,00,000/-. While making the said addition, the AO states that an unsigned confirmation of Shilpa Stock Broker (P) Ltd to whom the advance of Rs. 5,00,000/- was given was filed without address and PAN No. Since no details were forth coming, the AO treated the advance as unexplained u/s. 69 of the Act. Aggrieved, assessee preferred appeal before CIT(A), who deleted the additions by observing in para 7.2 as under : "7.2 I have gone through the facts of the case. It is seen that the AO has made addition because proper confirmation of account was not field in respect of loan given to Shilpa Stock Brokers Pvt. Ltd. amounting to Rs. 5,00,000/- He made the addition u/s. 69. However at the Remand stage it was mentioned that addition was made not because confirmation was not filed but because the source of the investment was not explained.....