TaxTMI 
TaxTMI 
2021 (9) TMI 1080
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....6. 3. That the Ld. Commissioner of Income Tax (Appeals) has erred in law and on facts in not appreciating the fact that the approval granted by the Ld. Addl. CIT, Central, Kanpur u/s 153D of the Income Tax Act,1961 is mechanical in nature and without proper application of mind, therefore the same is illegal and non-est and consequential assessment made on the basis thereof is also illegal and deserves to be annulled. 4. That the Ld. Commissioner of Income Tax (Appeals) has erred in law and on facts in sustaining the order of the Ld. A.O., allegedly treating the Unsecured Loan of Rs. 2,00,00,000/- as unexplained investment for making addition in the income of the appellant. 5. That the Ld. Commissioner of Income Tax (Appeals) has erred in law and on facts in sustaining the addition of Rs. 5,00,000/- at the rate of 2.5 percent of the amount of loan as unexplained or undisclosed expenditure and invoking the provision of section 69C without having found any incriminating documents or any basis for the same. 6. That the Ld. Commissioner of Income Tax(Appeals) has failed to appreciate that in the show cause Notice's dated 12.12.2018 and 19.12.2018, the Ld. A.O. has prejudged ....
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....is invalid, unreasonable, unacceptable and not backed by any cogent material. 11. That the Ld. Commissioner of Income Ta (Appeals) has erred in law and on facts in not appreciating that the Ld. A.O. failed to deal with various objections and legal issues raised by the appellant vide his letter dated 24.10.2018 alongwith an affidavit of even date, on the diary seized and inventorized as BK-1 at the residence of the appellant. 12. That Ld. Commissioner of Income Tax (Appeals) has erred in law and on facts in sustaining the arbitrary additions made by the Ld. A.O. in the income of the appellant which are contrary to the principles of natural justice and equity, unsustainable and deserve to be deleted. 2. Further, the only additional ground taken by the assessee reads as follows: "That the Ld. Commissioner of Income Tax (Appeals), Kanpur has erred in law and on facts in staining the addition of Rs. 2,00,00,000/- on account of Unsecured Loan under section 68 of the Income-tax Act, 1961, without appreciating the fact that Bank Passbook is not the books of account." 3. Arguing Ground no.3 first, the ld. Counsel for the assessee has contended that in the cases of search, before pa....
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.... retracted the alleged statement purportedly recorded under section 132(4) of the Income Tax Act, 1961 by Shri Vijay Ranjan Sinha, vide letter dated 08.09.2016 filed before I.T.O. Ward-3(3), Kanpur (where the PAN of the assessee was lying), and also filed an affidavit during the course of assessment proceedings vide reply dated 24.10.2018 to the effect that the post declaration was made under coercion. In the absence of any adverse finding brought on record by the ld. A.O., this affidavit ought to have been accepted on its face value in accordance with law laid down by the Hon'ble Supreme Court in the case of Mehta Parikh & Company Vs. CIT, 30 ITR 181. c) The JCIT also failed to appreciate that in clause 6 of the Panchnama, it is clearly stated that the authorized official, Shri G.S. Saxena, DCIT, recorded the statement of Shri. Navin Jain and Shri. Naresh Kumar Jain on oath under section 132(4) of the Income Tax Act, 1961, however, the alleged purported statement recorded under section 132(4) of the Income Tax Act, 1961, on the basis of which the surrender of income and addition was made in the assessment order, is recorded by Shri Vijay Ranjan Sinha on the alleged statement....
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....urse of search nor any unexplained gold and silver jewellery was found during the course of search nor any addition was made in the assessment in this regard. i) The JCIT also failed to consider that the statements as recorded u/s 132(4) of the Income Tax Act, 1961 by Shri G. S. Saxena, Dy. C.I.T. mentioned in Clause 6 of Panchnama have not been brought on record by the ld. AO at any stage of the completion of proceedings by the ld. AO u/s 143(3) of the Income Tax Act, 1961. j) The JCIT failed to appreciate that the Ld. A.O. at para 2 on Page 19 of impugned assessment order himself has treated the above alleged trading as speculative business income, which is chargeable under the head "Profits and Gains from Business and Profession", and thereafter invoked the provisions of section 69A of the I.T. Act, 1961 while making the addition of Rs. 21 crores, thereby blowing hot and cold in the same breadth, which is not permissible. Moreover, set of loss was also allowed by the ld. Assessing Officer against the profit from the alleged speculative business by making the impugned addition u/s 69A of the Income Tax Act, 1961 k) The JCIT failed to appreciate that the ld. AO made the addi....
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....to be deleted. q) The JCIT also failed to appreciate that in Writ Petition No. 458 & 459 of 2015, filed by M/s Rich Udyog Network Ltd. and Cityon Nano Technology Pvt. Ltd., there was no mention of the name of the company M/s Cityon Solar Ltd. from whom the unsecured loan was received by the assessee in AY 2017-18. Only the question of conversion of survey into search was considered by the Hon'ble High Court. r) The JCIT failed to appreciate that no evidence of payment of cash from the assessee to Rich Group of cases was brought on record by the ld. Assessing officer with respect to the addition of Rs. 5,00,000/- being commission @ 2.5% made by the ld. A.O. under section 69C of the income Tax Act, 1961 and the addition was made solely on the basis of surmises and conjectures without bringing on record any cogent material. s) The JCIT also failed to consider that for each unabated and abated assessments, the authorities below and the Approving Authority (JCIT) shall have to verify the incriminating material found during the course of search or the seized material if pertain to the same assessment year and its basis. t) Before granting approval in a matter of few hours of ....
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....nnot express his opinion on a single case in one day how another ACIT can express his opinion in 67 cases in a single day. 9.10 The Hon'ble Bombay High Court has dismissed the appeal of the Department filed against the above order of the Mumbai Tribunal in the case of Shreelekha Damani vide judgment dated 27/11/2018. The findings of Hon'ble Bombay High Court are reproduced below: 10. Similarly we find that Hon'ble. Supreme Court in the case of 'Sahara India vs. CIT & Others' [2008] 216 CTR 303 (S.C.): [2008] 7 DTR (SC) 27: [2008] 300 JTR 403 (SC) while discussing the requirement of prior approval of Chief Commissioner or Commissioner in terms of provision of section 142(2A) of the Act, opined that the requirement of previous approval of the Chief Commissioner or Commissioner in terms of said provision being an inbuilt protection against arbitrary or unjust exercise of power by the Assessing Officer, casts a very heavy duty on the said high-ranking authority to see it that the approval envisaged in the section is not turned into an empty ritual. The Hon'ble Apex Court held that the approval must be granted only on the basis of material available on reco....