TaxTMI 
TaxTMI 
2022 (6) TMI 683
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....survey was carried out on M/s. Shree Raj Mahal Jewellers Ltd., M/s. PLB Infrastructure Pvt. Ltd., M/s. Shree Raj Mahal Diamonds Pvt. Ltd., at 2633 & 2634, Bank Street, Karol Bagh, New Delhi wherein papers/documents related to M/s. Solitaire World Pvt. Ltd. was found and impounded. Subsequently, the case was centralized from Ward-68(2), New Delhi u/s. 127 of the IT Act, 1961, by the jurisdictional CIT vide order F. No. CIT-B/Delhi/Centralization/2014-15/686 dated 06.02.2015 and the assessment u/s. 143(3) has been completed on 29.03.2016. 4. During the survey proceedings Annexure A-5, Page No. 8 was impounded which shows transactions and on top of the paper 'Received A/c' and 'Payment A/c' is written. In the said document, in the 'Received A/c' side property description "62/1 Ajmal Khan Park" was found mentioned. During the post survey proceedings, on being asked to explain the contents of the said document, it was submitted that the above property description belong to M/s. Solitaire World Pvt., Ltd. which is a part of SRM group of company. During the assessment proceedings, the assesses was asked vide letter dated 23.02.16 to furnish the following details....
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....surrender. In the same manner, in this document also, the amounts are bound to be mentioned in thousands. Hence, the amount of Rs. 55,00,000/- and an amount of Rs. 20,00,000/- totaling to Rs. 75,00,000/- has been added to the total income of the assessee based on the notings on the documents on 04/12 being 5500 and 2000 CHQ. 7. Aggrieved the assessee filed appeal before the ld. CIT(A). 8. The ld. CIT(A) gave remission of Rs. 20,00,000/- paid by cheque as forming part of the regular books of accounts. The relevant portion of the ld. CIT(A) is as under: Ground no. 2 for the AY 2013-14 relates to contention of the appellant against addition of Rs. 75,00,000/- made by the AO. The fact of the case is that the AO made addition on the basis of contents of a document, annexure A-5, page no. 8 impounded during the course of survey action, in which certain transactions was mentioned. This document was impounded from the office premises of the appellant In the said document unexplained expenditure of Rs. 55 lacs and Rs. 20 lacs respectively was noted, since, the source of the impugned expenditure remained unexplained before the AO, therefore, he made addition of the same under ....
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....ource of the balance expenditure of Rs. 55,00,000/- remained explained, therefore, the AO is directed to restrict the addition to Rs. 55,00,000/- as against Rs. 75,00,000/-, thereby, the appellant gets part relief on this ground." 9. The revenue accepted the decision of the ld. CIT(A) on the issue of remission of Rs. 20,00,000/- and no appeal has been filed. Aggrieved the assessee filed appeal before the Tribunal against the confirmation of Rs. 55,00,000/-. 10. Before us, the ld. AR argued that the entries cannot be read in isolation but they have to be read holistically. It was argued that the total receipts on the said impounded page have to be taken into consideration. It was argued as per the page the total receipts (Received A/C) were to the tune of Rs. 2,19,70,000/- whereas the total expenditure (Payment A/C) was Rs. 3,32,89,000/- (Payment A/C). 11. He relied on the orders of the Co-ordinate Bench of ITAT in the case of D. Suresh Vs. ACIT in ITA Nos. 462 & 463/Bang./2020, ACIT Vs Sharad Chaudhary 55 Taxmann.com 324 and the judgment of Hon'ble Kolkata High Court in the case of Pr. CIT Vs. Ajanta Foot Care 84 Taxmann.com 109. 12. On the other hand, the ld. DR re....
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....equires signatures of the person concerned using such Credit Cards. Apparently, therefore, all those transactions were undertaken by the third parties on behalf of the Assessee himself and therefore, the defence pleaded by the Assessee that they were allegedly loan taken by Mr. Neelamegan and repayments made by him to the Bank: account of the Assessee does not inspire any confidence. In our opinion, therefore, the fact finding Body below have rightly added the said amount in the hands of the Assessee as unexplained income/expenditure of the Assessee. Such addition does not appear to be perverse requiring our consideration under Section 260A of the Act...'' The Co-ordinate Bench of ITAT in the case of Somabhai Ambaalal Prajapati Vs. Assistant Commissioner of Income-tax, Central Ciircle-2(2), Ahmadabad [2017] 88 taxmann.com 369 (Ahmadabad - Trib.) 4. Ld. Counsel for the assessee contends as under:- (i) The incriminating paper based on which the addition was made was a dump document and a rough paper; (ii) Exact contents of the paper were neither opinion of the assessee nor the Assessing Officer could explain them; (ii) This amount ....
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....t of the report and as recorded in the order passed by the assessing officer, the assessee was afforded an opportunity to produce the concerned persons so as to prove the genuineness of the bills. The assessee filed replies which were primarily rejected on the ground that the assessee could not prove the existence of these parties. A relevant extract from the assessment order reads as follows:- "The reply submitted by the assessee has been considered and is not acceptable. The assessee not only failed to produce the said persons but was also not able to provide the PAN No./Sales Tax No. or Pollution Clearance certificate of these parties from which he has claimed to have made substantial purchase which have been made in cash. Further, the suppliers mentioned have addresses which are clearly mentioned on their respective bills. Spot verification carried out has clearly shown that no such parties existed at those addresses even in the year under consideration. Thus the contention of the assessee that they were present on-site is not also acceptable. It is also worth mentioning that notices u/s. 133(6) of the Income-tax Act, 1961 for furnishing of information were al....
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....de to LIC, under the circumstances the AO was fully justified in treating a sum of Rs. 3,05,000/- as undisclosed income of the appellant. The addition is confirmed." 103. Learned Departmental Representative supported the order of CIT(A). 104. Learned counsel for the assessee contends that the addition is unjustified. 105. We have heard the rival contentions and perused the material available on record. In the given facts, we are inclined to dismiss this ground of the assessee inasmuch as the assessee did not furnish any explanation before any of the authorities, in respect of repayment of LIC loan of Rs. 3,05,000/- in cash hand nothing has been explained before us as well. The Hon'ble Madras High Court in the case of Grand Bazzar Vs. ACIT 166 Taxman 232 held that "in the present case, the assessee had not explained as to the source of purchases and the additions under section 69C of the Act are, therefore, sustainable. Further, the Commissioner of income-tax (Appeals) is not justified in reducing/deleting the additions. As rightly observed by the Tribunal, the funds introduced by the assessee as cash credits in the books of account had gone i....
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.... should be corroborative evidence to sustain the entries to link the same and treat it as an un-explained investment to bring the case under Section 69 of the Act. In our considered view nothing more is required than the facts, which were considered by the Assessing Officer as well as the Commissioner of Income Tax (Appeals) and the Tribunal. The notings are clear and it is not any scribbling, which shows the figures and also shows whether the payments were in cash or in cheque. The retraction made by the assessee, after a period of two years, was rightly rejected as an afterthought. As held in the case of T. Rangroopchand Chordia (supra), the loose sheets are also 'documents'. In terms of Section 2 of the Indian Evidence Act, 1872, they can be relied upon. In fact, the Division Bench took into consideration whether the loose sheets seized from the premises of the assessee would constitute 'documents', within the meaning of exception under Sub-Section (4) of Section 132 of the Act and has held as follows: "21. Coming to the two questions of law now before us, it is seen that they revolve around the loose sheets picked up during search. These loose sheets ar....
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....s." 13. Heard the arguments of both the parties and perused the material available on record. 14. We find that the case quoted by the ld. DR of the Hon'ble Madras High Court in the case of S.S. Shankar Vs. ITO (107 Taxmann 55) dealt with issue of expenditure on credit cards which is not applicable to the facts of the instant case before us. 15. Similarly, in the case of S.A. Prajapati Vs. ACIT, CC-22, Ahmadabad (88 Taxmann 369) dealt with cash withdrawals. Hence, not applicable to the facts of the instant case before us. 16. CIT Vs. Narendra Kumar Gupta (55 Taxmann 371) dealt with the issue of bogus bills, hence, not applicable to the facts of the instant case before us. ACIT Vs. Subhash Verma (125 TTJ 865) deals with the issue of cash loans and subsequent payment to LIC. Hence, not applicable to the facts of the instant case before us. 17. Grand Bazar Vs. ACIT (166 Taxmann 232) dealt with the issue of cash credits in the books of account. Hence, not applicable to the facts of the instant case before us. 18. Similarly, the ld. DR's reliance on the judgment of Hon'ble Apex Court in the case Pradeep Kumar Vs. ITO (101 Taxmann 131) is not applicable to th....