TaxTMI 
TaxTMI 
2021 (7) TMI 767
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....les perused. 2. It transpires at the outset that all these appeals involve delay in filing of 03 days (ITA No.782/H/20) and 06 days (ITA Nos.784 & 785/H/20); respectively, stated to be attributable to the reason(s) beyond their control as per the respective condonation petition(s)/affidavit(s). No rebuttal has come from the departmental side. The impugned delay is condoned in all the above said appeals therefore. 3. We notice at the outset that all the three instant appeals arise from the departmental search action dt.04-07-2017. The same led to initiation u/s.143(3) r.w.s.153C and 153A proceedings; as the case may be, finally culminating in Section 69B un-explained investment addition(s) in the nature of on-money payments involving varying sums of money, stated to be based on the alleged incriminating material found/seized during the course thereof. 4. Before we proceed further, these assessees as well as the department are ad idem during the course of hearing that this tribunal's co-ordinate bench in ITA No.783/Hyd/2020 (involving yet another group concern M/s.Zainab Investments Private Limited Vs. DCIT pertaining to the very search action) stands reserved for final pronouncem....
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....ons of the appellant company with the creditor. The suspicion should lead to investigation to bring out the facts and material on record to disprove the contention of the appellant. No such enquiries were conducted by the AO to bring out facts/material on record. Suspicion, however strong, cannot substitute for evidence. The AO ought to have conducted further enquiries to take it to the logical conclusion. iii) The appellant discharged, the initial 'burden of proof by producing all the documentary evidences. The AO has not contradicted any of the evidences produced by the appellant. Unless some evidence is brought on record and appellant is confronted with such evidence, the burden does not shift back to the appellant. iv) No evidences, were found during the Search which are 'incriminating as to the transactions with various companies. The enquiries conducted were post search enquiries only. Otherwise, the transactions are duly recorded in the hands of recipient and the payer. v) The statement recorded by DDIT(Inv), Hyderabad at Delhi of Mr Bardia is perused. The statement is reproduced for ready reference. Ql. Please introduce yourself? Ans: I am Abhay Chan....
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....anies containing the registered addresses. Q.7. Where are the books of accounts of the above companies maintained? Ans: The books of accounts of these companies are maintained at the Corporate office i.e 20-B, Old Gupta Colony, Delhi. Q8. On verification it is found that the building at the above address is being demolished and no office was found functioning there. Please explain. Ans: Yes, the premise is under renovation. So we have shifted the relevant records temporarily to 3/14A, 1st Floor, Double Storey, Vijay nagar colony, Delhi. However, books of accounts are not readily available at this office. Back up of the accounts was taken up and kept with our auditor. I will furnish the books of accounts as and when required. Q9. Who are the directors of the above companies? Ans: They are all my relatives and friends and will furnish list of all directors of the above companies by post. Q.10. Have the above companies made any advances/investments in the following companies/individuals? S. No. Name of the company 1 Zainab Investments P Ltd 2 Zara Investments P Ltd 3 S.V. Multi Logitech P Ltd 4 Shoeb Estates P Ltd 5 Mrs. Laxmi Raman Ans: Yes, we have ....
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.... received any benefit out of the above investments made.? Ans: No, we have not yet received any benefits out of the above investments as this money has been invested for the collaboration/joint ventures of the projects. Q.17. Please furnish the details of the proposed projects. Ans: The projects at various places which are still in process. Q.18. It is seen that the amounts invested by you has been used by Sri. Ajaz Farooqi for making investments in mutual funds, fixed assets and acquisition of immovable properties in Hyderabad. As such the money is fully invested and is being enjoyed by Sri. Ajaz Farooqi and his family members. In these circumstances do you justify the genuineness of your investments. Ans: We have made the investments under an understanding/contract with the above mentioned companies, therefore we are fully essured about the joint venture project. Q.19. How were the above investments made in the above companies. Ans: The above investments were made through banking channels, I am furnishing the information separately. Q.20. Do you want to say anything else. Ans: No. It is seen from the above statement that Mr. Bardia has not admitted to any disc....
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....of Mr. J.K. Datta, General Manager of M/s. K.V.R. Rail Infra Projects Pvt Ltd., and in the premises of the Accounts Manager employed in the concerns of Shri Ajaz Farooqi certain incriminating materials were found and seized containing details of cash paid by the assessee company M/s. Zainab Investments Private Limited to Ms. Adala Bhanu Rekha and Ms. Adala Indira Priyadarshini towards purchase of residential property admeasuring 2855 sq yds at Road No. 36, Jubilee Hills, Hyderabad. As per these documents, total sale consideration of the property is Rs. 33,50,00,000/- out of which Rs. 19,40,75,000/- was mentioned to have been paid through Demand Draft and the balance amount of Rs. 14,09,25,000/- was said to have paid by cash. It was further revealed that the purchase of the property was made by Registered Sale Deed wherein it was stated that the property was purchased for Rs. 19,40,75,000/- vide document No. 4212 and 4213/2013, dated 07/11/2014 of SRO, Banjara Hills. The printouts of the Data found in the Pen-drive seized in the residence of Shri J.K. Datta are extracted in the order of the Ld. AO at page no.54 to 59 wherein Shri J.K. Datta has handwritten that the Pen-drive belongs....
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....riyadarshini confirmed the onmoney transaction and admitted the same in the scrutiny assessment proceedings and paid tax. 13. For the aforestated reasons the ld. AO came to the conclusion that the assessee company has paid on-money of Rs. 14,09,35,000/- to the sellers of the property and added to the income of the assessee invoking the provisions of section 69B of the Act. On appeal, the Ld. CIT (A) confirmed the order of the Ld. AO by observing as follows:- "8.2. I have considered the assessment order and submission of the appellant. The material evidencing cash payment to the extent of Rs. 14,09,00,000/- was found and seized during the course of Search from Mr. J.K. Dutta who is looking after the affairs of the group companies. M/s. Datta, from who possession, the material was seized clearly explained the contents of the seized documents unequivocally. The same was confronted to the appellant by way of show cause notice. Further, the seller of the property also accepted to offer cash receipts to tax and pay taxes on the above amounts received. The contents of the documents are collaborated by the statement of the person from whose possession the document is seized and the acc....
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....ed that no evidence was seized from the premises of the appellant or its Director Shir Ajaz Farooqi who has denied the authenticity of the noting's retrieved from the Pen-drive seized in the premises of the employee of the assessee. The Ld. AR further argued that merely based on the seller's statement that they have accepted on-money for the property sold to the assessee company, the assessee company cannot be held binding for such transaction. Hence reliance placed on the statements of Ms. Adala Bhanu Rekha and Ms. Adala Indira Priyadarshini the sellers of the property which are in the nature of third-party evidence cannot be held against the assessee for making addition. It was further submitted that the Ld. AO had not given any opportunity to the assessee for cross examining the sellers of the property viz., Ms. Adala Bhanu Rekha and Ms. Adala Indira Priyadarshini. The Ld. AR thereafter placed reliance in the decision rendered in the case of Anil Jaggi vs. ACIT, Mumbai reported in 89 Taxmann.com 266 (Mum. Trib.) and the decision of the Indore Bench of the Tribunal DCIT vs. Shri Mahesh Bansal in ITA No. 499/Ind/2018 vide order dated 12/6/2019 for the AY 2010-11. It was therefor....
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....ts or sale consideration of land, the assessment order is to be set aside. While deciding so the Hon'ble Court had placed reliance in the CBDT Circular dated 10/03/2003 referred herein above. Further, the Hon'ble High Court of Madras in the case CIT vs. S. Khader Khan Son vide order dated 4/7/2007 reported in [2008] 300 ITR 157 (Mad.), had held that the statement recorded U/s. 133A of the Act has no evidentiary value and any admission made during such statement cannot be made basis of addition. From the facts of the case before us, it is apparent that the Ld. Revenue Authorities while making the addition have heavily relied on the statement of the sellers and some dump-documents. The Ld. AO has observed in his order in para 21.4, Page 60 that when he confronted the sellers, they admitted for having received on-money for Rs. 14,09,25,000/- and had paid tax for the same in their scrutiny assessment proceedings. However, the Ld. Revenue Authorities have not produced the seller's assessment orders before us to verify the facts of those cases and by relying on the oral statements such addition was made in the hands of the sellers which is not appropriate. The final outcome of those as....