TaxTMI 
TaxTMI 
TaxTMI 
2025 (5) TMI 1778
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....8-19) 3. Revenue has raised following grounds of appeal in its appeal: - "1. The ld. CIT(A) erred in deleting the addition of Rs. 1,46,91,237/- made by on account of unexplained expenditure u/s 69C of I. T. Act, which has correctly been added by Assessing officer in the income of the assessee considering the facts and circumstances of the case. 2. The ld. CIT(A) erred in allowing assessee's appeal without considering the fact that the document No. B- 14 (page 1-31), based on which the addition was made is self hand written by Shri Atul Yamsanwar and found in his residential premises during the search action. 3. The ld. CIT(A) erred in deleting the addition of Rs. 1,46,91,237/- made by Assessing Officer on the ground of unexplained expenditure u/s. 69C of I.T. Act, without considering the fact that same amount of addition of Rs. 1,46,91,237/- has been taxed in the hand of Shri Atul Yamsawar as undisclosed income, for the A.Y. 2018-19, and the ld. CIT(A) has found it as true and correct and further upheld the addition. 4. Any other question of law and fact to be raised at the time of appeal." 4. Brief facts of the case are, a search and seizure action under section 132 ....
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....19 assessee has not purchased any shares from Shri Atul Yamsanwar and in Asstt. Year 2019-20 has purchased 14,38,250 shares only. Factual submission is as per legal evidence on record. Action of A.O. in making addition for purchase of 44,94,161 shares is contrary to legal evidence on record and is factually incorrect. C) A.O. has made the addition by referring to various loose papers which are scanned and pasted in the assessment order. Perusal of seized document scanned and pasted does not indicate name of assessee. It does not indicate that assessee has paid cash during Asstt. Year 2018-19 and 2019-20 for which addition has been made at the hands of assessee. No date and amount for which addition is made is found noted in the seized document. Seized documents are not found from assessee and same are dumb documents requiring no consideration at the hands of assessee for determination of assessable income. D) Purchase of share of M/s Orange City Housing Finance Ltd. are properly recorded in books of account and entire payment has been made through proper banking channel. Purchase of shares in various years are reported in annual return filed by corporate entity M/s Orange City ....
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.... 2019-20 assessee has paid consideration at Rs. 14.15 per share in cash is having no justification/rationale. I) In satisfaction note (P- 6 & 7) to issue notice u/s 153C A.O. has computed the sale of shares at Rs. 15/- per share to compute cash payment at Rs. 11,93,987/-. In assessment order A.O. has computed the sale price at Rs. 28/- pe share for no valid justification and is unjustified. J) Loose papers on the basis of which addition is made is found from third party and not from the assessee. Loose paper does not have handwriting of assessee. It has been reasonably explained by the person from whom such documents were found and seized. Thus addition made in the case of assessee is unjustified. K) Loose documents are in the nature of dumb notings calling for no adverse consideration at the hands of assessee." 9. Ld.CIT(A) had granted full relief by holding as below: - "4.1 The appellant has raised 9 grounds of appeal, out of which ground no. 1 and 9 are general in nature and therefore need no adjudication. The A.O. has made addition at Rs. 1,46,91,237/- u/s 69C of I.T. Act 1961 as unexplained expenditure. The A.O. has concluded that appellant has paid cash to Shri Atuly....
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....er account of purchase of shares shows opening investment at Rs. 3,06,94.245/ and closing investment is shown at Rs. 10,66,16,354/-. Shares from various persons have been acquired at the price per share @ Rs. 13.85. Total number of shares acquired during the year are 54,68,800 which includes 1438250 shares purchased from Shri Atul Yamsanwar. The appellant has purchased 4030550 number of shares from persons other than Shri Atul Yamsanwar. The aggregate number of shares as at the close of accounting year is 7891971 in number (2423171 + 5468800). In the annual return at page 10 share holding of appellant is shown at 7891971 shares in number and same matches with shares shown in financial records. During the financial year ending on 31.03.2020, M/s Orange City Housing Finance Ltd. has made Investment of Rs. 11,82,94,906/- in shares. As per Ledger account of shares of company, it indicates that 843217 shares have been acquired from Shri Atul Yamsanwar at the cost of Rs. 13.85 per share. The aggregate share held by the appellant in the company as on 31/03/2020 are 8735188 (opening 78,91,971 + 8,43,217) which were tallied with the financial record. Such type of investment was accepted i....
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....4/2018 to 31/03/2019 xi. Form No. MGT-7 (Annual Return) for Financial Year 2018-19. xii. Audited Financial Statement as on 31/03/2020 in the case of assessee xiii. Ledger A/c of Share of Orange City Housing Finance Ltd. for the period from 01/04/2019 to 31/03/2020 xiv. Ledger A/c of Advance for Shares of OCHFL - Atul Yamsanwar Sir for the period from 01/04/2019 to 31/03/2020 xv. Form No. MGT-7 (Annual Return) for Financial Year 2019-20 xvi. Assessment order u/s 143(3) in the case of assessee vide order dated 13/07/2021 for Asstt. Year 2017-18 xvii. Assessment order u/s 143(3) in the case of assessee vide order dated 13/07/2021 for Asstt. Year 2020-21. 11. Ld.AR also relied on the following Judgments in support of his submissions: - i. CIT vs. P.V. Kalyanasundram (2207) 294 ITR 0049 (SC) ii. Addl. CIT vs. Prasant Ahluwalia (2005) 92 TTJ 0464 (Cuttack) iii. ITAT order in ITA No.250/Mum/2013 in the case of M/s. Riveria Properties Pvt. Ltd. vide order dated 27/10/2017 iv. ITAT order in ITA No. 1502/AHD/2015 in the case of Nishant Construction Pvt. Ltd. vide order dated 14/02/2017 v. Common Cause (A Registered Society) vs. Union of India (2017) 77 taxmann.com 24....
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....the income of the assessee of that previous year." The language of the Law is vague and subjective, thus making us rely on an Apex court decision in the case of CBI vs. V.C. Shukla ((1998) 3 SCC 410), wherein the relevant portion reads thus: "Collection of sheet fastened or bound together so as to form material whole. Loose sheets or scraps of paper cannot be termed as books." In this regard, it is relevant to extract Section 69A of the Act, which reads thus: "69A. Where in any financial year the assessee is found to be the owner of any money, bullion, jewellery or other valuable article and such money, bullion, jewellery or valuable article is not recorded in the books of account, if any, maintained by him for any source of income, and the assessee offers no explanation about the nature and source of acquisition of the money, bullion, jewellery or other valuable article, or the explanation offered by him is not, in the opinion of the Income-tax Officer, satisfactory, the money and the value of the bullion, jewellery or other valuable article may be deemed to be the income of the assessee for such financial year.". The lack of corroborative evidence to show how the loose ....
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....CIT(A) in the case of Atul M. Yamsanwar, wherein Ld.CIT(A) has sustained the addition as under: - "I have carefully considered the submissions of the AR of the appellant and have found no merit in the same. It is difficult to comprehend how the details noted by appellant himself in his handwriting should be considered as rough notings. The fact of the matter is that the calculation of transfer of shares is corroborated by the fact that such transaction has actually taken place. The calculation of the transaction appears at many pages seized during the search operation from the appellant's residence. The calculations are in appellant's own handwriting. On basis of seized papers corresponding corroboration can be established from pages 4-6 & pages 14-23, Page 1 & 4 of B-16 regarding total no. of shares sold and amount received in cash. The consideration received by the appellant against the sale of shares from Shri Deepak Ghadge has been received in parts from time to time as is evident from the impugned pages. It is possible that a few arithmetic mistakes are appearing in the seized papers, but the same is immaterial and insignificant. These seem to be calculation errors o....