TaxTMI 
TaxTMI 
2023 (9) TMI 1078
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....tive Engineer with PWD Department, Government of Madhya Pradesh showing income from salary and house property. There was a search and seizure operation u/s. 132(1) of the Act was conducted in the residential premises on 26.02.2009. 2.1. During the course of search, cash of Rs. 3,93,800/- was found and out of that Rs. 3,53,300/- was seized. There were jewelleries of Gold and Silver were found in the residential premises as well as the bank locker at State Bank of India, but jewelleries were not seized. Further certain documents belong to the assessee were also found and seized during the course of search proceedings. Pursuant to the same, the assessees were issued with notices u/s. 153A on 17.02.2010 to file the Return of Income for the Assessment Years 2002-03 to 2008-09. The assessees filed the respective Return of Incomes as follows: Shri Jitendra Bhasne Asst. Years Original Return Return u/s. 153A Dated Income Dated Income Assessed Income 2005-06 - - 30.08.2010 1,56,460 9,77,460 2006-07 - - 30.08.2010 1,14,457 29,72,695 2007-08 - - 30-08-2010 1,25,890 32,83,890 2008-09 31.07.2009 1,43,11....
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....urns of income only after search & seizure operations. Her claim of earning from tuition was also not supported by any document. Thus, the appellant and his wife failed to prove that Smt. Bharti Bhasne had ever earned any income from tuition or beauty parlour etc. Considering the facts of the case, the AO was justified in rejecting the cash flow submitted by the appellant. Since Smt. Bharti Bhasne had no source of income, the AO was justified in holding that the source of investment in plots at Goragoan and payment for registry of plot at Kerwa Dam at Bhopal remained unexplained and assessing the same as unexplained investment of the appellant from undisclosed sources. Accordingly. the addition of Rs. 4,12,000/- in A.Y. 2006-07, of Rs. 2,65,000/- in A.Y. 2007-08 and of Rs. 30,000/- in A.Y. 2009-10 made on substantive basis in the hands of the appellant are confirmed. (B) "Additions of Rs. 19,90,000/- in A.Y. 2007-08, of Rs. 50,09,528/- in A.Y. 2008-09 and of Rs. 67,64,000/- in A.Y. 2009-10 on account of unexplained investment in ICICI Prudential Insurance policy in the name of Smt. Bharti Bhasne substantively in the hands of appellant." 6.4 I have carefully consid....
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....ed in cash. Smt. Bharti Bhasne had tried to explain the above investment mainly from following sources: (i) Amount of Rs. 51,00,000/- claimed to be received from Roshan Co-operative Housing Society after surrender of her rights in the property; and (ii) On account of cessation of customers liability of Rs. 5,03,531/- in A.Y. 2007-08, of Rs. 47,57,258/- in A.Y. 2008-09 and of Rs. 17,50,000/- in A.Y. 2009-10. From the facts of the case, it is evidently clear that both these sources were an afterthought made up story just to try to explain an unaccounted investment in ICICI Prudential Insurance Policies. As regards source of Rs. 51,00,000/-, it was claimed that the father of Smt. Bharti Bhasne had gifted a property to her before her marriage which was claimed to be purchased for Rs. 1,00,000/- in 1990 and she had surrendered her rights in the property after settlement and received Rs. 51,00,000/- in August, 2008. But the AO, after examining the facts in detail proved that it was a cooked up story and no transaction had taken place in which the Smt. Bharti Bhasne had received cash of Rs. 51,00,000/-. The observations of the Ld. AO were not rebutted b....
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....nt through cheque or draft in the name of insurance company itself. Further, Smt. Bharti Bhasne had provided names of 18 customers from whom she had claimed to have received these amounts, which were later on claimed to be appropriated by her as cessation of liability. But when she was asked to produce these 18 persons who were claimed to be agriculturist, only 8 persons were produced and their statements were recorded. From the statements recorded it was found by the AO that there were contradictions in their statement and, therefore, could not be relied upon. The appellant also failed to explain satisfactorily the contradictions in their statements. Thus, this was also a made up story just to try to show availability of cash in the hands of Smt. Bharti Bhasne to explain unexplained investment by the appellant in the purchase of ICICI Prudential Insurance in the name of his wife, Smt. Bharti Bhasne. In this regard, reference may be made to the decision of the Hon'ble Supreme Court in the case of Income Tax Officer Vs. Atchaiach (Ch) (1996) 218 ITR 239 (SC), wherein the Hon'ble Supreme Court observed as under :- "Under the present Act, the Income-tax Offic....
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....stigation/ enquiry, Ld. AO had proved with cogent material that it was a made up story just to build up cash to show the source of purchase of ICICI Prudential Insurance Policies. It may be noted that during the course of search no such argument was taken by the appellant and rather the appellant's wife, Smt. Bharti Bhasme had surrendered the total investment in ICICI Prudential Insurance Policies including the policies purchased in the name of the appellant and agreed to pay tax thereon. The Ld. AO had successfully proved that the alleged agreement to purchase dated 13.05.2003 purported to be entered between appellant's father Shri BL. Bhane and Shri Mardan Singh was not genuine as it was shown that no such stamp paper was actually purchased from Shri Sayed Anwar Rizvi in the case of Shri Mardan Singh Vs. Shri B.L. Bhaste. The AO also found from the statement of Shri Mardan Singh recorded on 15.12.2010 that he was a contractor working under the appellant and further that Shri Mardan Singh did not possess the creditworthiness to pay sach an amount in cash. There were many contradictions in the submission of the appellant and the statement of Shri Mardan Singh, which the app....
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....ge relates to office work calculation of allotment receipts, whereas in the submission during appellate proceedings, it was contended that it was purely a dumb document and the same cannot be used as an evidence as the name, date and purpose were not mentioned on this page. This shows that the appellant is taking a different stands at different stage of proceedings, which cannot be relied upon. During assessment proceedings, it was stated that the transactions recorded on this page were related to work calculation of allotment receipts but the appellant failed to adduce any evidence from the office of P.W.D. to prove this contention. Thus, the appellant had not discharged his onus to properly explain the transactions recorded on this page. It was not a dumb document as the appellant himself admitted that on this paper transactions relating to government receipts were entered. This paper clearly mentioned the total amount of Rs. 8,27,000/- received. Therefore, in these circumstances, the AO was justified in making addition of Rs. 8,27,000/-, treating the same as undisclosed income of the appellant. Hence, addition of Rs. 8,27,000/- in A.Y. 2005-06 is confirmed. (E) Addition....
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....e 4 seized. 11.4 I have carefully considered the submission of the appellant and facts of the case. The appellant stated that this amount of Rs. 51,579/- was related to maintenance of government quarters. But the appellant failed to adduce any evidence whatsoever in support of his claim. In the absence of any evidence, the submission of the appellant cannot be accepted. Therefore, the addition of Rs. 51,579/- made by the AO is confirmed. (H) Additions of Rs. 4,30,000/- on the basis of transactions recorded on page 8 of LPS-10 seized from the residence of the appellant. 12.4 I have carefully considered the submission of the appellant and facts of the case! The contention of the appellant that this is a dumb document is not tenable because the appellant himself had admitted that the transactions recorded on this page pertained to purchase of a Scorpio Vehicle of Rs. 4,30,000/-. However, the appellant contended that the vehicle belonged to a senior officer. But this statement of the appellant could not be accepted because the appellant had not stated the name of the senior person for whom the Scorpio vehicle was claimed to be purchased. The onus was on the a....
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....rs. The appellant contended that these amounts pertained to the payments to be made to these contractors for the work done by them but the appellant had not adduced any evidence whatsoever in support of his contention that these were not payments received by him. Therefore, the AO was justified in making addition of Rs. 1,00,000/- as amounts received by the appellant from these contractors, who were undertaking contract work for roads under his jurisdiction. Hence, the addition of Rs. 1,00,000/- for A.Y. 2009-10 is confirmed. The appellant admitted that the entries written on this page as "100 = 35+20+" below the names of 'Abi' and 'Pandit' are related to contractors. The appellant contended that these amounts pertained to the allotment balances in regard to construction of roads in Raisen Division. But the appellant had not adduced any evidence whatsoever in support of his contention that these were not payments received by him. In the absence of any supporting evidence, the AO was justified in making addition of Rs. 1,00,000/- as amounts received by the appellant from these contractors, who were undertaking contract work for roads under his jurisdiction. ....
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....nts relate to the payments made to the contractor by PWD Department and not commission/ illegal gratification received by the appellant. Therefore, the addition of Rs. 11,50,000/- is confirmed. The appellant reiterated the same submission as was made before the Ld. AO. The appellant had not mentioned the name of the person referred to as "Sahab" in the document. Had it been expenditure incurred for any official vehicle, the appellant could have furnished the relevant documents / confirmation from the office to explain the transaction. Since, the appellant had not discharged his onus to explain the source of expenditure of Rs. 63,576/- incurred for repairing of a vehicle, the AO was justified in treating the same as unexplained expenditure incurred by the appellant. Hence, addition of Rs. 63,576/- made by the AO in A.Y. 2009-10 on account of unexplained expenditure incurred by the appellant out of his undisclosed income is confirmed. The contention of the appellant that these papers contain rough notings is not acceptable because the names and items of the goods purchased are specifically mentioned. Against the name of Smt. Seema Jaiswal, the appellant had written ....
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....iled to rebut the fact that the name of the appellant was appearing in the incriminating documents found and impounded from the premises of Shri R.K. Garg. contractor. During assessment proceedings, the appellant had also not asked for cross examination of Shri R.K. Garg. Thus, the entries recorded in the incriminating document found from the premises of Shri R.K. Garg, which were corroborated by the statement of Shri R.K. Garg, contractor, proved clearly that amount of Rs. 3,00,000/- was paid to the appellant as illegal gratification. Therefore, the AO was justified in making addition of Rs. 3,00,000/- in the hands of the appellant for A.Y. 2009-10. Hence, the addition of Rs. 3,00,000/- is confirmed. 4. Aggrieved against the Appellate Orders, the assessees are in appeals before us raising various Grounds and the same are tabulated as follows: Consolidated Grounds of Appeal- late Jitendra Bhasne & Smt. Bharti Bhasne Assessment Years Issues involved 2005-06 2006-07 2007-08 2008-09 2009-10 Gr. No. IT(SS)A 181/Ind/2014 Gr. No. IT(SS)A 182, 178/Ind/2014 Gr. No. IT(SS)A 183, 179/Ind/....
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.... as dumb document. Similarly, addition of Rs. 15,00,000 + 45,000/- for A.Y. 2006-07, the loose papers does not carry any name and it does not indicated to whom, it was given. This is nothing but a rough jottings related to allotment of work in Government Medical College. The Ld. A.O. has not conducted any inquiry in this regard. Similarly, Rs. 1,50,000/- for A.Y.2007-08, the loose paper contained only "Samradha" (near Mandideep) and "Santosh res" written at bottom of the loose paper. Only some amount and some measurements written, does not clear whether it is received or paid. Thus it is a dumb document. For A.Y. 2008-09 a sum of Rs. 51,579/- "Collector - A.C. Split AC", there was no bill for the above Split AC, no inquiry was conducted, where this A.C. is located but treated as illegal gratification given by assessee to Collector in the form of Split AC. Similarly, purchase of scorpio vehicle for Rs. 4,30,000/- from undisclosed income. In this loose paper, there is no name, only date relating to "Scorpio" and "Regn" were marked. Though the assessee submitted that this loose paper relates to Scorpio Vehicle of senior officer and the amounts given by him from time of payment of inst....
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....partment, when various payments break-up are entered into the loose paper seized. Regarding Rs. 7,50,000/- treated as illegal gratification on the basis of loose paper seized, the assessee failed to substantiate the above payments were made to Shri Vinod Gupta, Anil Songra for the work done by them by PWD Department with necessary evidences. Thus the assessee failed to discharge the initial onus cast upon him/her. 7.2. Regarding addition of Rs.63,576/- based on seized documents LPS-17, the contents of the same is reproduced as follows: SAHAB- Raisen 1. Scorpio Servicing Rs. 6,060/- 2 Sahab GWL + Delhi TKT Rs. 1,500/- 3 Mohan Salary - April, May, June Rs. 12,000/- 4 Taxi Bill Rs. 42716/- Total Rs. 62,276/- 5 Scorpio Horn Rs. 1300/- Total Rs. 63,576/- 7.3. When this loose paper was confronted to the assessee and why an inference may not be drawn that these amounts, which appear to be expenditure incurred by the assessee for his senior officer referred to as "Sahab" represent the illegal gratification given by the assessee. The assessee replied that these entries relates to his senior officer scorpio....
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....urnalists (Patrakar), amounts paid to various officials and Smt. Seema Jaiswal as unexplained expenditure totaling to Rs. 3,82,500/- which has been made by the assessee out of his income from undisclosed sources. The Ld. CIT(A) held that the contention of the assessee that these loose papers contain rough jottings is not acceptable because the names and item of the goods purchased are specifically mentioned in the loose sheet. Further against the name of Smt. Seema Jaiswal, the assessee had written "500 notes' which reflects that the assessee had made the payments to Smt. Seema Jaiswal in cash for various purposes. Therefore the Assessing officer was justified in holding that the total expenditure of Rs. 3,82,500/- was incurred from undisclosed sources by the assessee. Even, before us, no new document or evidence filed by the assessee to disprove the past savings of the lower authorities. In the absence of the same, we have no hesitation in confirming the above additions made by the A.O. 7.4. The Ld. CIT(A) has dealt with the above issues which is reproduced in Para 3-A to J of this order wherein detailed discussion were made by Ld. CIT(A) for every additions made under the loos....
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....e could be produced before the Authorities. However Certificates as a Teacher and Beautician and IRDA are filed in the Paper Book at Page nos. 51 to 54, the source of investment is a sum of Rs. 51,00,000/- was received by Smt. Bharti Bhasne from her father by sale of land and similarly Rs. 25,52,638/- in the name of Shri Jitendra Bhasne which was claimed to be the refund of money from agricultural land at Morena. The Ld. Assessing Officer after making detailed enquiry with Roshan Grih Nirman Sahakari Sanstha and its Secretary Shri Deepak Soni statement recorded on 23.12.2010 that no payments were made by the Samiti to Smt. Bharti Bhasne. Later Smt. Bharti Bhasne claimed that one Shri Shakil Ahmed has done the transaction on behalf of the Samiti. But the assessee failed to produce Shri Shakil Ahmed and confirmed that she do not have detail about the Shakil Ahmed. Further it is stated that the sum of Rs. 51,00,000/- was received in cash for surrendering of rights in the said property which are also made up story just to try to show that the availability of cash in the hands of the assessee. Thus the A.O. clearly added the same as the unexplained investment in the hands of the assesse....