2009 (7) TMI 104

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....judication orders were set aside. 2. The relevant facts of the case as per record, in brief, are that the respondents were engaged in providing taxable service of "Pandal and Shamiana Service". On 6.1.2006, Income Tax Officers conducted survey whereby the respondents No. 1 Bindra Tent Store surrendered an amount of Rs. 10 Lacs and the respondent No. 2, M/s. Prompt Tent Service surrendered Rs. 8.5 Lakhs for the financial years 2005-2006. Show cause notices dated 31.1.2007 and 5.2.2007 were issued against the respondents proposing demand of tax on the amount surrendered by them and to appropriate the amount deposited by them and also to impose penalty along with interest. The Original Authority confirmed the demand of tax of Rs. 1,11,385.0....

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....that the respondents surrendered the amount to the Income Tax Department during the survey on 6.1.2006. It was explained that whenever surrender of amount was made under the Income Tax Act, it is added to the income in the Assessment Year 2005-06 (relevant to the previous year) for the purpose of charging income tax. The amount surrendered represents the established accumulated effect of undisclosed incomes for the earlier financial years since 1999-2000. The Original Authority observed that the respondents failed to produce any evidence regarding income of the said amount shown to the Income Tax Department that income was from other sources. In this context, the findings of the Commissioner (Appeals) are reproduced below:- "8. The main ....