TaxTMI 
TaxTMI 
2015 (4) TMI 1175
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.... 4. In grounds of appeal no. 2 to 4 the assessee has challenged the order of Ld. CIT(A) in upholding the action of the AO in confirming the addition of Rs. 5,00,000/- made by the AO as unexplained investment u/s. 69B and the addition of Rs. 75,000/- as unaccounted interest. 5. Facts of the case, in brief, are that the assessee is an individual and derives income from salary from the partnership firm and money lending business. In this case the AO had initiated action u/s. 147 of the I.T. Act and notice u/s. 148 was issued to the assessee on 29-03-2007 after obtaining approval from the Addl. CIT. The reasons recorded by the AO for issuing notice u/s. 148 of the Act are as under: "During the course of Search and Seizure action u/s. 132 of the I. T.Act, 1961, on 29.07.2003, in the business cum-residential premises of Shri Shreeram H. Soni. A large number of documents /papers were seized by The Investigation Wing, Pune. The said papers related to The transactions of unexplained investment / unaccounted income for advancing cash loans to a number of parties either by Shri Shreeram A. Soni by taking brokerage or by various Investors Shri Shreeram H. Soni, by charging interes....
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.... 1. Sumati Dayal V CIT,(1995) 214 ITR 801 (SC), in relation to the secret transactions, and (2) CIT Vs. Durga Prasad More (1971) 82 ITR 540 (SC) P 545.547. If you need any further clarification/assistance, you may approach/contact the undersigned." From the aforesaid facts it is evident that the aforesaid assessee under consideration made unexplained investments of Rs. 5,00,000/- as on 31.3.2001 towards money lending business from his unaccounted income and also received interest accordingly as stated above which also remained to be disclosed in the return of income filed by the assessee. In view of the above facts, I have reason to believe that there is escapement of income, exceeding Rs. 1 lakh and hence this proposal." 6. In response to the said notice, the assessee submitted that the return already filed may be considered as return in response to notice u/s. 148. The AO issued statutory notices from time to time. During the course of assessment proceedings, the AO confronted the assessee regarding the transactions pertaining to loans and advances given by the assessee to Shri Shriram H. Soni which were found in the seized documents during the course of search and....
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....tion drawn u/s. 132(4A), the onus shifted on to him to disprove that what was apparent from the record was not actually so. The assessee merely filed explanation dated 25-12-2007 stating that he did not recognize any person by the name of Shri Soni and therefore could not have invested the life time earned funds with an unknown person. He gave details of loans amounting to Rs. 5,67,000/- advanced to other parties and stated that interest of Rs. 95,418/- earned thereon had been offered to tax. The contentions of the assessee were therefore, neither proved nor substantiated by any evidences and remained uncorroborated/ unverified. He also rejected the other contention of the assessee that no corroborative evidence in the form of pronotes, hundis and blank cheques have been found during the course of search on the ground that such documents would have normally been available in the premises of the assessee and the department did not undertake any action through survey/search on the assessee's premises and therefore such evidences are not available. Rejecting the various explanation given by the assessee and distinguish the various decisions cited before him, the Ld. CIT(A) upheld the ....
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..../PN/2013 iii. Jagannath Eknath Lahoti (HUF) Vs. ITO, ITA No. 453/PN/2012 12. Referring to the decisions at Sl.No.I and III above the Ld. Counsel for the assessee submitted that under identical facts and circumstances the Tribunal has deleted the addition made in the hands of the respective assessee on the basis of entries found in the seized diary of Shri Shreeram H. Soni. He accordingly submitted that the addition made by the AO and upheld by the Ld.CIT(A) be deleted. 13. The Ld. Departmental Representative on the other hand strongly supported the order of the CIT(A). He submitted that in such type of transactions only code names are used and no complete names and addresses are mentioned in the books of account. It is held by the Tribunal in the case of Shri Shreeram H. Soni that the investors are identifiable from the seized material. Therefore, when the name of the assessee is appearing in the seized diary, therefore, Ld. CIT(A) was fully justified in upholding the action of the AO in bringing to tax the loan amount of Rs. 5,00,000/- u/s. 69B and the interest income of Rs. 75,000/- as income from other sources. He accordingly submitted that the order of the Ld. CI....
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....ype of cases where additions have been made on the basis of entries found in the diary of Shri Shreeram H. Soni. The Tribunal in those cases had deleted the addition in absence of any corroborative evidence found from the residence of Shri Soni belonging the respective assessees. We find the Tribunal in the case of M/s. Kejals Furnishings (supra) has deleted the addition made by the AO and upheld by the Ld. CIT(A) by observing as under: "11. We have considered the rival arguments made by both the sides, perused the orders of the Assessing Officer and the CIT(A) and the Paper Book filed on behalf of the assessee. We have also considered the various decisions cited before us. We find the AO in the instant case made an addition of Rs. 1,04,500/- on the basis of certain documents seized from the premises of one Mr. Shreeram H. Soni. We find the AO confronted the notings of the seized documents to the assessee. The assessee vide his reply dated 07- 12-2007 had submitted that it has never lent any funds to Soni group. It was categorically stated that the notings are relating to one Mr. Rashmi Gandhi and it does not pertain to the assessee firm. It was also stated that no evidenc....
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....r. Shriram H. Soni his statement was recorded u/s.132(4) and he had refused specifically to identify each and every investor/operator. Although credits appearing in the seized diaries in the name of different investors was treated as undisclosed income of Mr. Shriram H. Soni by the CIT(A), however, the Tribunal vide order dated 17-06-2010 has reversed the same by holding that persons are identifiable and all the materials available clearly show that Mr. Shriram H. Soni has only earned commission. Be that as it may be, Mr. Shriram H. Soni had refused to identify each and every person. We find the seized diaries/papers clearly show different names such as "Jagannath Lahoti" and "Jaguseth Lati". However, we find no addition has been made on account of entries appearing in the name of the assessee, i.e. Jagannath Lahoti. Even the entries appearing in the name of the assessee for subsequent years has also not been brought to tax by reopening the assessment, a statement made by Ld. Authorised Representative and not controverted by the Ld. Departmental Representative. We, therefore, find merit in the submission of the Ld. Counsel for the assessee that the Department by not reopening the a....
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....icer himself is not sure that the assessee is the same person whose name was found noted in the seized document. Moreover, nothing is on record to show that Shriram H. Soni has stated about the assessee that whatever the notings found were in respect of the assessee. No corroborative material is found. In our opinion, the Ld.CIT(A) has rightly deleted the entire addition as there is no evidence against the assessee. We find no merit in the appeal filed by the Revenue. Accordingly, the same is dismissed." 8.2 Since identity of the assessee was not proved by Mr. Shriram H. Soni at any point of time nor any corroborative evidence was found from the residence of Mr.Shriram H. Soni so as to prove that the assessee is the same person as per the name appearing in the seized document, therefore, respectfully following the decision of the Coordinate Bench of the Tribunal in the case of Ashok Keshvlal Oswal (Supra) and in absence of any contrary material brought to our notice, we set-aside the order of the CIT(A) and direct the Assessing Officer to delete the addition." 11.2 Since the facts of the instant case are identical to the facts in the case of Jagannath Eknath Lahot....