TaxTMI 
TaxTMI 
2017 (8) TMI 120
X X X X Extracts X X X X
X X X X Extracts X X X X
....ome-tax Appellate Tribunal was right and justified in allowing the set off of Rs. 16 lakhs as lease payment which was disallowed by the Assessing Officer and confirmed by the Commissioner of Income-tax (Appeals) and whether the finding in respect of the above additions is perverse ? 3. Whether on the facts and circumstances of the case, the learned Income-tax Appellate Tribunal was right and justified in holding that Rs. 16 lakhs had flown back from unexplained lease payments and whether the finding in respect of the above additions is perverse ? 4. Whether on the facts and circumstances of the case, the learned Income-tax Appellate Tribunal was right and justified in deleting the additions made of Rs. 1,73,600 for investment in Kullu land and whether the finding in respect of the above additions is perverse ? 5. Whether on the facts and circumstances of the case, the learned Income-tax Appellate Tribunal was right and justified in deleting the additions of Rs. 4,82,065 for Raisina land and whether the finding in respect of the above additions is perverse ?" 3. The brief facts of the case are that the assessee-company is a closely held company of Mr. V....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ed by one representative Umesh Mehta during search. 5. Counsel for the appellant Mr. Singhi has relied upon the following decisions : 5.1 In Tribhovandas Bhimji Zaveri v. Union of India reported in [1993] 204 ITR 368 (SC) holding as under (page 376) : "We do not find ourselves in agreement with Mr. Divan's submission that sub-section (2) of section 3 should be construed as if it were a proviso to sub-section (1) and to treat it as merely carving out of the ambit of sub-section (1). The authorities dealing with the manner of interpreting a proviso need not, therefore, be dealt with. Nor do we agree with Mr. Divan when he says that reading the words of sub- section (2) literally will produce an absurd result. The words of sub- section (2) are clear and unambiguous ; the words must, therefore, be interpreted as they read. So read, they harmonise with the provisions of section 14. To those assessees who have declared concealed income, subsequent to a seizure during a previous year, for that previous year or any previous year prior thereto the more beneficial provisions of section 3 do not apply, for the declaration is not really voluntary, and the less beneficial pro....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... was likely to be dealt with under the penal provisions of the Income-tax Act. The action of the petitioner in filing the returns under such a constraint cannot be said to be voluntary. In Mool Chand Mahesh Chand v. CIT [1978] 115 ITR 1 (All), the Income-tax Officer started investigation by asking for details in respect of several matters while conducting the assessment proceedings for the year 1969-70. Thereafter, the assessee filed returns for the years 1964-65 to 1970-71. It was held that since the investigation had started and concealed income had come to light, it was a case covered by the word 'detection' occurring in section 273A. It was further observed that in these circumstances the returns were filed after the assessee felt that the game was up because the investigation initiated by the Income-tax Officer exposed him to a situation that he had assessable income in respect of other years ; it cannot be said that the filing of the return was voluntary. This decision shows that the term 'voluntary' under section 273A has been used to indicate an action free of any constraint. A return filed in order to save oneself from a possible penal action canno....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ined investments.-Where in the financial year immediately preceding the assessment year the assessee has made investments which are not recorded in the books of account, if any, maintained by him for any source of income, and the assessee offers no explanation about the nature and source of the investments or the explanation offered by him is not, in the opinion of the Assessing Officer, satisfactory, the value of the investments may be deemed to be the income of the assessee of such financial year." 10. He has taken us to para 8 of the Tribunal which reads as under : "By keeping in mind the ratio laid down by the Bombay High Court in the case of CIT v. Shamlal Balram Gurbani [2001] 249 ITR 501 (Bom), we are of the view that such income cannot be considered at undisclosed income in the hands of the assessee. Even otherwise entry in the books of accounts is not very important factor for making the addition under section 69C where the more important factor is whether the expenditure has explained source or not. Once the source is explained, then the addition is not warranted." 11. With regard to issue Nos. 2 and 3, the Tribunal has held as under : "In the inst....