TaxTMI 
TaxTMI 
2016 (10) TMI 254
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....n facts in deleting the addition of Rs. 1,17,428/- made by the Assessing Officer on account of low household withdrawal. 4. The order of the CIT(A) is erroneous and is not tenable on facts and in law. 2. The brief facts of the case are that search and seizure operation u/s. 132 of the Act was carried out in Vipul Group of cases on 01.06.2006 covering the flagship company of the group M/s. Vipul Ltd. and their director's. This also included search action at the residence of Sh. Puneet Beriwala, the assessee at 15/10, Sarvpriya Vihar, New Delhi. In pursuance to the search, a notices u/s 153 A of the Act in respect of the assessment year 2001-02 to 2006-07 were issued and served on the assessee on 20.03.2007. The assessee in compliance thereto, furnished return of income on 26.07.2007 for each of the assessment year including the assessment year under consideration 2006-07. In respect of the assessment year 2006-07 the assessee furnished a return declaring his total income at Rs. 1,24,36,040/-. The learned A.O. however, framed an assessment at an income of Rs. 8,64,03,4607- inter-alia making following additions to the declared income: (i) Addition on a/c of low house....
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....11 Rs. 6,75,000/- Expenses for conversion & purchase Rs. 5,00,000/- of jewellery for wife Sunita Beriwala (on the basis of Annexure A-3) Amount spent on traveling expenses Rs. 4,21,000/- Rs.3,461,000/- Rs.1,01,05,976/- The submission of the appellant is that therefore while there was an item of Rs. 5 lacs offered and included in the breakup of the additional income disclosed during the search proceedings for Rs, 1,01,05,976/- , which was on the basis of Annexure A-3, but while writing the narration in the addition to capital account as above instead of writing the description of Rolex watch and Mont Blanc Pen in the capital account , the same was inadvertently mentioned as "expenses for conversion and purchase of jewellery for wife Sunita Beriwala". That this was a clerical mistake as evident from the fact that as per Annexure A-3, it is these items i.e. Rolex Watch ( Rs. 4 lakhs) and Mont Blanc pen (Rs. 1 lakhs) which has been inventorised and surrender of additional income was made to only these items. The submission of the appellant as well as An....
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.... the assessee, at 10/11, Sarvpriya Vihar, New Delhi. ii. It is also a matter of record that none of these pages bears the signature of the appellant or for that matter any other person including Sh. Vinit Beriwala and Sh. Shyam Sundar Beriwala the brother and father of appellant. iii. No statement on oath has been recorded at the time of search or even during post search investigation or during assessment proceedings in case of Sh. Vinit Beriwala, from whose residence these seized papers were found. Thus it is not clear as to in whose hand writing these pages have been written. iv. There is considerable force in the submission of the appellant that the presumption under law in section 132(4A) and 292C of the IT Act would only apply with respect to books of accounts /documents found in possession or control of any person. Now as the documents at pages 1 to 109 of A-l have not been found from the possession or control of Sh. Punit Beriwala therefore the presumption under these two sections cannot be raised against the appellant. v. Thus as there is no evidence to suggest that these seized documents are in the handwriting of the appellant and as it ....
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....r requisitioned belongs or belong to a person other than the person referred to in s. 153A he shall proceed against each such other person and issue such other person notice and assess or reassess income of such other person. However, there is a distinction between the two provisions in as much as under s. 153C notice can be issued only where the money, bullion, jewellery or other valuable article or thing or books of account or documents seized or requisitioned belong to such other person, whereas under s. I58BD if the AO is satisfied that any undisclosed income belongs to any person, other than the person with respect to whom search was made under s. 132 or whose books of account or other documents or assets were requisitioned under s. 132A, he shall proceed against such other person under s. 15SBC. 13. Thus a condition precedent for issuing notice under s. 153C and assessing or reassessing income of such other person, is that the money, bullion, jewellery or other valuable article or thing or books of account or documents seized or requisitioned should belong to such person. If the said requirement is not satisfied, resort cannot be had to the provisions of s. 153C of t....
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....e complete ownership and limited ownership of interest. Of course, belonging to is capable of connoting, interest, which is less than absolute perfect legal title. However, there should be some limited ownership of interest, if it is to be permitted that the assets belong to the assessee. In the instant case, documents or books of account found during the course of search and seized cannot be termed to be indicating any limited interest of the ownership of the assessee in such books of account or documents. The language used in s. I53C is materially different from the language used under s. 158BD. As per s. 158BD, if any undisclosed income relates to other person, then action against such other person can be taken provided such undisclosed income is referable to the document seized during the course of search. However, s. I53C says that if valuable or books of account or documents belonging to other persons are seized then action under s. I53C can be taken against that person. In the instant case, we are satisfied that books of account or documents do not belong to the assessee and, therefore, the AO was not justified in initiating action under s. I53A r/w s. I53C of the IT Act. Th....
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.... the assessee for initiation of proceeding u/s 153C of the IT Act are not fulfilled in the case of the appellant. vi. Coming to the contents of the document referred to in Annexure A-l( Pages 1-109 ) the appellant in his submission has inter-alia stated that these pages mainly related to the deeds of family settlement of Beriwala group at different point of time. Referring to page no 106 it is stated that this page contains an action plan as it records "understanding reached on 11.04.06". That against point no.7 on this page it is written that "PB will pay cash to VB/SSB@ 50,00,000/- per week at least to complete by 31st May." That this paper appears to be written on 11.04.06 and that negotiation for family settlement were going on since April., 2005 and many drafts papers were prepared, but due to one or other reason the settlement among the family members did not materialize. Referring to page 107 the appellant has submitted that this page is dated 12,09.06 and contains details of "pending portion arising from family settlement of 12.09.06". Referring to the last para on this page wherein notings of "payments till date PB-»SSB-1.25 and PB -»VB 6.0850 the argu....
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....ger brother of the appellant. As already noted above there is no evidence to the effect that the seized documents are in hand writing of the assessee. No statement has been recorded from the person in whose possession / control these documents are found & seized and therefore the issue of confronting/cross examination to the appellant does not arise, which was a basic legal requirement. Moreover there has been no addition to income in hands of either Sh. Vineet Beriwala or Sh. SS Beriwala for A.Y.2006-07 (based on the above narrative), copy of assessment order for which has been enclosed. Further there is no record of any cash for Rs. 7,33,50,000/- or a lesser amount found at any of the premises of Sh. Vineet Beriwala or Sh. SS Beriwala , nor any details of any investment/ expenditure having been made out of this supposed amount of Rs. 7,33,50,000/-found in search on Sh. Vineet Beriwala or Sh. SS Beriwala. It is relevant to note that the search has been conducted on 01.06.06, which is barely 50 days from the date of written on page 12.04.06. Thus there has been no corroborative evidence found in search or post search investigation to substantiate the fact that the appellant has mad....
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....king a over view of the above facts the addition made for Rs. 1,17,428/- is directed to be deleted." 3. Aggrieved by the order of ld. CIT(A), the Revenue is in appeal before the Tribunal. 4. The ld. DR, as to the deletion of addition of Rs. 5,00,000/-, relied on the order of the ld. Assessing Officer and submitted that the ld. CIT(A) was not justified in deleting this addition ignoring that through annexure A-3 to the Panchnama, the assessee accepted undisclosed investment of Rs. 5 lacs in purchase of Rolex Watches, whereas in the statement of affairs prepared on the basis of loose papers seized, the assessee has given details of additional / undisclosed income & utilization of fund of Rs. 500000/-, as having been spent for conversion and purchase of jewellery for his wife Smt. Sunita Beriwala. Therefore, the assessee having not been adhered to the original surrender, the AO had rightly made addition of Rs. 5,00,000/-. 5. On the other hand, the ld. AR of the assessee relied on the order of the ld. CIT(A) and submitted that the addition has been rightly deleted after considering the explanation of the assessee that there had been computer error in the statement of affairs w....
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....ion amongst the three family groups etc. It was submitted that the aforesaid amount was mentioned to have been paid by the assessee to Vinit Beriwala and Shyam Sunder Beriwala, which stood unexplained. Therefore, the ld. CIT(A) was not justified in deleting the addition. 8. The ld. AR of the assessee relied on the order of the ld. CIT(A) and submitted that the ld. CIT(A) has accepted the contentions of assessee after giving good reasons. Therefore, the impugned order does not require any interference. It was submitted that the alleged document was not seized from the control or possession of the assessee nor does it bears any signature and hand writing of assessee. It was submitted that page No. 107 of this document does not show that the assessee had paid the alleged sum of Rs. 7,33,000/- in F.Y. 2005-06 to Sh. Vinit Beriwala and Shri S.S. Beriwala. No statements of Vinit Beriwala or SS Beriwala are brought on record about receipt of such payments, if made by the assessee. It was also submitted that the narration "the payment till date" if read in the context of title to the documents could only mean that as on 12.04.2006 payment due to be received from Sh. Punit Beriwala was a....