TaxTMI 
TaxTMI 
2005 (12) TMI 63
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.... 3. Whether, in the facts and circumstances of the case, the Tribunal was right in law in ignoring a very material fact mentioned and accepted by the Commissioner of Income-tax (Appeals) that the Assessing Officer had taken the writings of the assessee and other persons connected with him and none of such persons were examined by the Assessing Officer before coming to the conclusion that the handwriting belonged to the assessee? 4. Whether, in the facts and circumstances of the case, the Tribunal was right in law in holding that the order of the Commissioner of Income-tax (Appeals) was also erroneous as regards the accounting year found by the Assessing Officer as relatable to the assessment year 1983-84 when there is no mention at all of any year in the said papers and the provisions of section 69 were not applicable as it was not a case of unexplained investment being found? 5. Whether, in the facts and circumstances of the case, the Tribunal was right in law in holding that the order of the Commissioner of Income-tax (Appeals) was erroneous as he did not comment in detail on the reasons enumerated by the Assessing Officer for including the said amounts as income of the ass....
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....f the Act. The assessee carried the matter in appeal before the Commissioner (Appeals) for both the years. The Commissioner (Appeals) allowed the appeals of the assessee holding that the Assessing Officer had not established that the diaries and the loose papers seized in the course of search and seizure proceedings belonged to the assessee. The Commissioner (Appeals) also recorded that there was no evidence to show that the documents contained the handwriting of the assessee. Lastly, it was held that there was no basis for the Assessing Officer to conclude from the seized documents that the assessee had made investments to the tune of Rs. 48,14,727, and that the investments, if any, were made in the financial year corresponding to the assessment year 1983-84, and hence, the Assessing Officer could not have invoked section 69 of the Act. The Revenue preferred appeals before the Tribunal. The order of the Commissioner (Appeals) was faulted with by the Tribunal and the appeal was restored to the file of the Commissioner (Appeals). In the process the Tribunal held that the burden was on the assessee in view of the provisions of section 132(4A) of the Act to lead evidence to rebu....
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....2(5) of the Act came to be made, because the section dealt with not only documents, but also assets. Mr. M.R. Bhatt, learned senior standing counsel appearing on behalf of the respondents, submitted that section 132(4A) applies to all proceedings and the section only relates to a rule of evidence not warranting any restrictive application. Referring to the legislative history it was submitted that section 132(5) of the Act came on the statute book in 1965 and came to be deleted in 1995, while section 132(4A) of the Act came on the statute book in 1975 and has not been deleted. That section 132(4A) of the Act has to be read as a part of section 132(4) of the Act; that both the provisions fall within the Chapter dealing with powers of authorities. According to Mr. Bhatt, section 132(4A) of the Act only lays down rule of evidence, and prescribes only the starting point, namely, the date of search for applicability of the provision with no closing point or limitation on the applicability. He placed reliance on the decision of the Karnataka High Court in the case of CIT v. P.R. Metrani (HUF) [2001] 251 ITR 244 to submit that the presumptions arising under section 132(4A) of the Act a....
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....h books of account and other documents are true; and (3) that the signature and every other part of such books of account and other documents which purport to be in the handwriting of any particular person, or which may reasonably be assumed to have been signed by, or to be in the handwriting of, any particular person, are in that person's handwriting, etc. On a plain reading of the aforesaid provision it is apparent that clauses (i) and (ii) raise a presumption that the books of account belong to the person searched, or the person from whose possession or control the books are recovered or found, and that the contents of such books are true. However, when it comes to clause (iii) of section 132(4A) of the Act, it raises a presumption in relation to the signature and the handwriting to be of the person in whose handwriting the books, etc., are purported to be, or a reasonable assumption may be raised that the books, etc., are signed by or are in the handwriting of any particular person. The distinguishing feature is, the clause does not necessarily raise a presumption qua the person searched or from whose possession the books are found. The language employed in clauses (i) and (ii)....
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...., "the learned Commissioner of Income-tax (Appeals) also found fault with the Assessing Officer's action on account of the difficulty of financial year. Such difficulty was to be finalised in accordance with the provisions and the date of search and seizure. The observation in this respect of the learned Commissioner of Income-tax (Appeals) has again mislead him to arrive at a wrong conclusion". The Tribunal lost sight of the fact that section 69 of the Act opens with the words "Where in the financial year immediately preceding the assessment year, the assessee has made investments ..." Therefore, in the first instance it was incumbent upon the authority to establish that there were investments made by the assessee; that such investments were not recorded in the books of account maintained by the assessee; and that such investments had been made in the financial year immediately preceding the assessment year in question. Unfortunately, despite the Commissioner (Appeals) having recorded a categorical finding, the Tribunal has failed to appreciate the said finding and dealt with the same without giving cogent reasons. If the Tribunal found that the said finding was not correct, it....