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2022 (5) TMI 1142
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....2009-10 80/Pun/2017 Assessee CIT(A)-12, Pune order dated 28.08.2017 Case No. PN/CIT(A)-12/787/2014-15 143(3)r.w.s. 153A 2 2012-13 1133/Pun/2017 53/Pun/2017 Assessee Revenue CIT(A)-1, Pune order dated 20.03.2017 Case No. PN/CIT(A)-12/828/2014-15 143(3)r.w.s. 153A) Heard the assessees as well as the department through their learned representatives. Case files perused. 2. We first of all advert to the Revenue's appeal IT(SS)A No. 53/Pun/2017 in former assessee's case. Its former substantive grievance pleaded herein seeks to reverse the CIT(A)'s findings deleting unexplained investment addition of Rs.7,25,00,000/- made by the Assessing Officer in his assessment order allegedly based on the incriminating material found and seized during the course of search dated 04.10.2011. Both the learned counsels take us to the CIT(A)'s detailed discussion deleting the impugned addition as below: - "49. Vide this ground, appellant had challenged addition of Rs. 7,25,00,000/- being unexplained investment. While dealing with the issue, the AO has held as under : 9 Addition on account of unexplained investments in Land. 9.1 During the cours....
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....erialize. It is brought to your notice that, on the backside of this page total cost of agreement is noted of Rs 725.00 Lacs, out of that payment through cheque is noted of Rs 400.00 Lacs and through cash is noted of Rs 325.00 Lacs. The bifurcation of total payment of Rs 725.00 Lacs is also noted on this page. Further, details of PDC are also noted. Further, from the above notings it appears that you have purchased property for the total cost of Rs 7.25 Crores and against which you have made payment of Rs 4 Crores by cheque and Rs 3.25 Crores in cash. The above explanation furnished by you is not acceptable. Please show cause as to why amount of Rs. 3.25 crores paid in cash should not be assessed as your income from undisclosed sources? 9.4 The assessee chose to be reticent and did not reply to the specific query raised in the above show cause notice. However to afford one last opportunity of being heard in keeping with the principles of natural justice, the assessee was requested to furnish detailed particulars adverting to the name and address of the parties dealt with and the complete description of the property which was negotiated to be purchased in terms of this offi....
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....explained investment in land 6.l] The Ld. A.O. has discussed this issue in para 9 of the asst. order. According to him, in the course of search on the assessee, certain loose papers were seized. He has referred to seized paper No. 11,' Annx A - 2. He has also reproduced the noting on pg. 7 of the asst. order. The learned A.O. has stated that the assessee has made an unexplained investment in purchase of property of Rs.7.25 Crs. and he has made the addition U/S 69. The learned A.O. has stated that the seized paper indicates details of post dated cheques and therefore, it is evident that the assessee has made the investments of Rs.7.25 Crs. Accordingly, he has made the addition ofRs.7.25 Crs. 6.2] The assessee submits that the addition made is not justified at all. The copy of the seized paper is enclosed herewith. Now, the notings on the paper indicate some proposed transaction wherein total amount was Rs. 7 .25 Crs. out of which Rs. 4 Crs. was by cheque and balance Rs.3.25 Crs. was by cheque. In the course of asst. proceedings, the assessee has clarified to the A.O. that these notings were relating to some proposed transaction which did not materialized. The A....
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....appellant did not furnish any details regarding the notings on the impugned page. However, at the time of assessment proceedings, appellant submitted that the notings were the terms proposed by seller of property to the appellant and the proposal did not materialize. Thereafter, the AO issued show cause notice stating that appellant had purchased property for consideration of Rs. 7.25 crores and asked to show cause as to why cash component of Rs.3.25 crores be not taxed as income from undisclosed sources. No reply was filed by the appellant, the AO added entire amount of Rs.7.25 crores as unexplained investment u/s 69 of the Act. During the course of appellate proceeding, appellant reiterated that notings pertained to some proposal which did not materialize. The appellant had not received or paid any amount of Rs.4 crores by cheque. It was contended that the manner in which notings were recorded in respect of manner of payment and society transfer charges, it was clearly a proposal. Nowhere on the loose paper, name of the appellant was mentioned; therefore, attributing the transaction to the appellant was not justified. Since no such transaction took place, there was no reason to m....
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....and. We make it clear that there is no dispute regarding an alleged incriminating evidence found during the course of survey carry presumption of correctness under Section 292C of the Act. The question in this factual backdropis as to whether the seized document herein satisfies the foregoing presumption or the same stands rebutted. We note from the case file that all the corresponding entries have been made on a pad of the Maharashtra State Electricity Transmission Company Ltd. We wish to observe here that this company has nothing to do with any sale and purchase of a moveable or immoveable property concerning the assessee at all. The very factual position continues even in the entries forming part of seized documents wherein all what is given is total cost of Rs.725.00 lakhs including cheque of Rs.400 lakhs and cash component of Rs.325 lakhs; respectively. There is not even a single mention of any property or the date of any cheque payment made from the assessees'. All these clinching facts lead us to the conclusion in assessee's favour and against the department that the statutory presumption of correctness under Section 229C itself stands rebutted since the learned Assessing Of....
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....t Shri Palai who arranged the entire transactions. The A.O further noted in para 17.8 that the deposits were routed through RTGS with the role of the main architect as arranger being apparently played by Shri Palai and it was some kind of arrangement. Merely because the bank accounts were used the assessee was not absolved from explaining the source of funds. The ld. A.O therefore, held that since the assessee failed to explain the said deposits, the addition of Rs. 2,64,00,000/- was made u/s 68 of the Act. On the other hand, the assessee submitted that there was no reason to make the addition since all these amounts are duly recorded in his books of account which was audited u/s 44AB of the Act. The bank accounts were part of the books of account of the assessee. The assessee submitted the relevant ledger account to point out that all these deposits amounting to Rs. 2,64,00,000/- were out of the funds transferred from another bank account No. 792230000307 maintained by the assessee with the HDFC Bank Ltd. The learned CIT(A) accepted this contention of the assessee that the deposits made in a/c No. 07921000006316 of the HDFC Bank were from the funds withdrawn from another a/c No. 7....
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....such case, relief may be given to the assessee as per law. The ld. D.R. fairly conceded to this submission of the ld. A.R. 11. Having heard the parties herein, considering the facts and circumstances and in the interest of justice, we are of the considered view that the ld. A.O should verify the sanctity and correctness of the Bank A/c No. 7922320000307 in HDFC Bank Ltd. belonging to the assessee and examine whether the funds deposited of Rs. 2,64,00,000/- in the bank account No. 07921000006316of the HDFC Bank, whether they were from this account or not and re-adjudicate this issue in totality as per law. Needless to say that, the ld. A.O. shall comply with the principles of natural justice and provide an opportunity of hearing to the assessee. Ground No. 2 of the revenue's appeal is allowed for statistical purposes." 7. We thus adopt judicial consistency in the instant issue and leave it open for the Assessing Officer to verity the necessary factual position in very terms. It is made clear that the assesses shall be very much at liberty to place on record all necessary evidence(s); if any, in consequential proceedings. The Revenue's instant latter substantive ground is....
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....ividend in the hands of the appellant without appreciating that if at all, any addition is warranted, the same should be restricted to the peak amount of the loans given during the year. The appellant craves leave to add, alter, amend or delete any of the above grounds of appeal 9. Learned counsel if fair enough in not pressing for all of these grounds from No. 1 to 3.2. All these pleadings are therefore, decided in Revenue's favour in very terms. 10. Coming to the assessee's substantial Ground No. 3.3, learned counsel took us to the CIT(A)'s detailed discussion in page 118 of the lower appellate proceedings containing the corresponding ledger entries that both the lower authorities ought to have made the impugned addition only qua the peak amount than regarding each and every sum(s) coming from the company side. He has also quoted this tribunal's coordinate bench decision(s) in ITA No. 1458/Del/2010 Shri Prakash Narain Singh vs. Assessing Officer and ITA No. 2336/Del/2011 ITO vs. Sandeep Sabharwal dated 14.10.2015 in support of the assessee's instant arguments. 11. We find no merit in assessee's stand. There could hardly be any dispute that the deeming fiction of....