TaxTMI 
TaxTMI 
2016 (3) TMI 632
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....ated sales and as the properties were not sold there can be no generation of income without considering that the said advance were never repaid by the assessee and the finding of the CIT(A) is contrary to his own findings whereby he has confirmed addition of Rs. 10 lakhs based on the same documents." C.O.No.4/Kol/2011 "1. a) FOR that the Ld. CIT(Appeals) erred in law as well as on facts in retaining the addition to the extent of Rs. 10 lacs on the basis of the seized papers marked NT/1, Pages-20 & 21 on irrelevant considerations. The Ld. CIT(Appeals) erred in not appreciating the fact that the seized documents marked NT/1, Pages-20 & 21 did not relate to the appellant and no addition could be made on the basis of the said seized papers as income of the appellant. b) FOR that in any case, the addition of a sum of Rs. 1 0 lacs or any amount whatsoever as income of the appellant on the basis of the said seized papers is wrong, unjustified and bad-in-law. 2. FOR that the appeal filed by the Revenue objecting to the reliefs allowed by the Ld. CIT(Appeals) is frivolous and without any substance and is liable to be rejected in toto." 3. The Assessee is an ....
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.... Kolkata and Premises No.159/A, Rashbehari Avenue, Kolkata belong to a trust by name Brijlal Todi Charitable Trust. The assessee explained that it was a family trust of the assessee and that the assessee was not the owner of the aforesaid properties. The assessee therefore disowned receipt of any moneys as stated in the seized documents. The AO however held that the assessee failed to produce books of account of the trust for verification and therefore the claim of the assesee could not be believed. AO observed that receipt of sum of Rs. 2,50,000/- by cheque is reflected in the regular books of accounts. The order is silent as to in whose books of accounts the said sum was reflected. In respect of the remaining Rs. 12.30 lakhs recorded as received by cash in the seized documents, the AO held that the same is undisclosed income of the assessee for the block period 01.04.1990 to 12.02.2001. The said sum was added in the various assessment years as per the details given in the seized documents which are as follows :- Date of Receipt Asst.Year in which to be considered Amount 6-2-1999 1999-2000 Rs.1,50,000/- -do- -do- Rs.2,50,000/- Rs.4....
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....ssessee thus submitted that on the basis of notings in the loose papers which do not belong to the assessee, in respect of the property which does not belong to the assessee, without any evidence or material to show that the assessee received money as recorded in the seized documents, no addition can be in the hands of the Assessee and doing so is wrong, unjustified and arbitrary. 9. CIT(A) on a consideration of the aforesaid submissions came to the following conclusions :- 4.2 There is no dispute that the entries in page no. 20 and 21 of seized paper NT/I refer to sale of rooms at 32, Ezra Street and 159/ A, Rashbehari Avenue. There is no dispute that the consideration of Rs. Rs. 2.5 lakh mentioned as received in cheque in the seized paper in respect of the rooms at 32, Ezra Street were actually received. Appellant has disputed the receipt of balance sum of Rs. 12.30 lacs mentioned as sale consideration of rooms mentioned in the seized paper in addition to the consideration received in cheque of Rs. 2.5 lakh. I do not think that appellant can dispute the total consideration of sale mentioned in the seized paper as incorrect when a part of such sale consideration receiv....
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....ri Avenue. The seized papers show that wherever Brij lal Todi Charitable Trust had transferred the ownership of Rooms to the purchasers through the conveyance deeds, the cheque amount was received. by the trust and wherever the ownership of rooms was yet to be transferred, only the cash amount is appearing as advance received. The .rooms in respect of which the ownership is transferred are in respect of premise at 32, Ezra Street only and are mentioned in the seized papers as under: Particulars of Property Name of Purchaser Consideration in cheque Total consideration Date Consideration in Cash Room No.56 Rakesh Kr.Garg 50000 200000 6/2/99 150000 Room No.43 Hitesh R.Shah 50000 300000 6/2/99 250000 Room Nos.9&10 Gopal Das Mimani 100000 500000 23/9/99 400000 Room No.19 Gopal das Mimani 50000 250000 23/9/99 200000 Therefore it is highly probable that the cash of Rs. 10 lakh, received in respect of sale of the above mentioned rooms No 56, 43, 9& 1 0 and 19 of the premise at 32, Ezra Street, has been pocketed by the appellant on the basis of circumstantial evidences and on the bas....
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....igned by CIT(A) for sustaining the addition to the extent of Rs. 10,00,000/-was that the seized documents evidenced receipt of Rs. 2.5 lakhs by cheque and a further sum of Rs. 12.30 lakhs by cash. CIT(A) has proceeded on the assumption that the received of Rs. 2.5 lakhs by cheque has not been denied and therefore the receipt of cash of Rs. 12.30 lakhs could also not be denied. The CIT(A) proceeded on the basis that if part of the seized documents is accepted as true then the whole of such seized paper is required to be accepted as true. In our opinion in coming to the above conclusion the CIT(A) has presumed that a sum of Rs. 2.5 lakhs received in cheque was received by the assessee. This presumption is not correct. In this regard we find from the deed of conveyance dated 01.09.1999 executed by Brijlal Charitable Trust in favour of Shri Rakesh Garg, one of the tenants of the premises at Room No.56, 32, Ezra Street, Kolkata that the cheque was given in the name of Brajlal Todi Charitable Trust. The registered deed of conveyance was signed by Shri Anil Kumar Todi on behalf of the trust and not by the assessee. It may be true that the trust has received a sum of Rs. 2.5 lakhs by chequ....
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.... therefore neither the addition of Rs. 10 lakhs nor addition of Rs. 2.30 lakhs which is agitated by the revenue in its appeal can be sustained. For the reasons given above, we therefore allow the Cross Objeciton of the assessee and dismiss ground no.1 raised by the revenue. 14. As far as ground nos. 2 and 3 raised by the revenue are concerned, as we have already seen in the course of search documents seized NT/1 at pages 34,35,36, 37 and 38 are the relevant documents. As far as the aforesaid grounds of appeal are concerned the first aspect that needs to be noticed is that in the course of the assessment proceedings the assessee specifically pointed out before the AO that pages 22 to 42 of NT/1 are documents belonging to M/s. BCL Financial Services Ltd.of which the assessee is the Managing Director and that BCL will explain the transactions as mentioned in these documents. This contention of the assessee was accepted by the AO and the following are the observations of the AO in this regard : "Necessary declarations had been filed by the above persons concerned acknowledging the transaction noted in the above mentioned documents relate to them and they will explain the tr....
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....e that these notings do not relate to him and was a dumb document and not speaking by itself. The AO, however, rejected the claim of the assessee and made addition of Rs. 12.5 lakhs. On appeal by the assessee the CIT(A) deleted the addition made by AO. The second part of page 35 contained certain notings of transactions. These are listed at pages 8 and 9 of the assessment order. These notings contained detailed amount and payment expected by a certain date. The sum total of the figures recorded in these loose sheet was Rs. 50.85 lakhs. Despite explanation of the assessee that he was not aware of the contents of the document and that the documents in any case is a dumb documents which it is not supplying of any receipt of money by the assessee. AO added a sum of Rs. 50.85 lakhs. 16.1. On appeal by the assessee the CIT(A) ,deleted the addition made by the AO for the reasons in para 4.5. of the order which is as follows :- "4.5 The page 35 of NTI/1 contains is a list of transactions, mostly sale of vehicles with the names of owner of such vehicles, which are likely to result in receipt of heavy money. The amount of expected receipt is also written and date of expected rece....
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....7.1. These additions were deleted by CIT(A) for the reasons given in para 4.6 of his order which reads as follows :- "4.6 The page 36, 37 and 38 of NT/l contain list of some vehicles and persons from whom money is to be realized and money is to be received on account of sale of vehicle. In some places name of the owner of the vehicle is also written. Some of these entries are scored out also. The total amount appearing on these pages, irrespective of the fact, whether entries are scored out or not, whether entries reflect any debt or income, whether entries pertains to appellant or any other person, is considered by the Assessing Officer at Rs. 3.3 lakh + Rs. 8.05 lakh + Rs. 4.65 lakh . Assessing Officer_has not brought any, corroborative evidence in the form of sale of vehicle mentioned in these papers, identity of the owner of the vehicle, identity of debtor, written in this paper and the reason as how such sale and receipt can result in undisclosed income of appellant when the relation of appellant with such transaction or vehicle is not established at all. Moreover, some of the entries are scored out. I therefore find that these entries are dumb entries and no arbitrar....