TaxTMI 
TaxTMI 
2026 (5) TMI 609
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.... 2021-22 -Do- 23.09.2022 143(3) of the Act 2. Since all the appeals filed by the assessee are having common, identical and similar issues, therefore, they are decided by a common order. 3. First we take appeal of the assessee in ITA No. 5533/Del/2025 [Assessment Year 2016-17]. ITA No. 5533/Del/2025 [Assessment Year 2016-17] 4. Brief facts of the case are that the assessee filed his return of income on 29.07.2016, declaring total income at INR 36,92,170/-. A search and seizure action was carried out in the case of Manoj Kumar and his close associates and various other parties on 14.10.2020 u/s 132 of the Act. The premises/locker of the assessee were also covered during the search. Thereafter, proceedings u/s 153A of the Act were initiated in the case of the assessee. The assessee has derived income from salary and from other sources. During the course of search, one ledger book was found and seized marked as Annexure "A-4" from his residence at 145, Bahera Enclave, Paschim Vihar, New Delhi wherein cash and bank transactions carried out by the assessee were recorded. In the said ledger books, two types of transactions were noted:- (i) Individual ledger....
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....TA No. 5534/Del/2025 [Assessment Year 2017-18] 15. Ground of appeal Nos. 1 to 4 raised by the assessee are with respect to the initiation of proceedings u/s 153A for which no submission is made therefore, these grounds of appeal are dismissed. 16. Ground of appeal No.5 raised by the assessee is with respect to the addition made towards unexplained investment u/s 69 of INR 1,20,86,000/- and Ground of appeal No.6 raised by the assessee is with respect to the addition of INR 67,63,628/- made u/s 69C of the Act on account of unexplained expenditure alleged as found noted in the seized diary. 17. Before us, Ld.AR requested that since the issue involved in both the Grounds of appeal are linked with each other and submits that the AO has treated the entries of cash transactions found noted in the diary marked as Annexure "A-4" seized during the course of search from the possession of the assessee wherein AO has treated following Two types of transactions noted therein separately :- (i) Receipt and payments of loans in cash; (ii) With respect to income and expenditure in cash 18. Ld. AR submits that diary contained unaccounted as well as accounted for transact....
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....annot be treated as separate transactions and integral part of finance activity carried out by the assessee as broker and thus the ld. AR prayed that no addition should be made on this account. 21. On the other hand, Ld. CIT DR for the Revenue vehemently supported the orders of lower authorities and submits that entries contained in the diary seized during the course of search contained unaccounted transactions carried out by the assessee and therefore, the AO has rightly made the additions separately for the cash transaction of loans & advances by taking the excess of receipt over payments as well as of the unaccounted expenditure u/s 69C of the Act separately. He thus, requested to confirm the orders of the lower authorities. 22. Heard the contentions of both the parties at length and perused the material available on records. It is an admitted fact that diary found and seized from the possession of the assessee was in his hand writing. Further undisputedly, this diary contained entries related to unaccounted transactions of loans solicitated by the assessee wherein receipt and payments of loans and unaccounted expenditures are noted. The AO invoked section 69A for making a....
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....Accordingly, we direct the AO to compute the income of the assessee as brokerage @ 2% of gross cash receipt of INR 21,65,16,666/- from the cash transactions found recorded in the diary and remaining addition made is hereby deleted. With these observations, Grounds of appeal Nos. 5 & 6 raised by the assessee are partly allowed. 24. Since no submission were made in respect of Grounds of appeal No. 7 & 8 raised by the assessee therefore, the same are dismissed. 25. In the result, appeal of the assessee in ITA No. 5534/Del/2025 for AY 2017-18 is partly allowed. ITA No. 5535/Del/2025 [Assessment Year 2018-19] 26. During the course of hearing, both parties fairly admitted that all the issues in present appeal are common with the issues in assessee's appeal for AY 2017-18 in ITA No.5534/Del/2025 wherein we have deleted the additions made on account of excess of receipts over payments as well as excess of expenditure over income and estimated the brokerage income of the assessee @ 2% of gross cash receipts found noted in the said diary. Thus, by following the observation made in ITA No. 5534/Del/2025 which are Mutatis Mutandis applied to the facts of this year also, we direct t....
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....e should be allowed against the deficit of INR 6,30,000/- held as cash expenditures found noted in the same diary. Accordingly, by allowing the benefit of telescoping and set off, no separate addition is required to be made and thus the addition of INR 6,30,000/- is hereby deleted. The Ground of appeal No. 5 raised by the assessee is allowed. 33. Ground of appeal Nos.6 & 7 are not pressed hence, dismissed. 34. In the result, appeal of the assessee for Ay 2019-20in ITA No. 5536/Del/2025 is partly allowed. ITA No.5537/Del/2025 [Assessment Year 2021-22] 35. Brief facts of the case are that the assessee filed return of income for the year under appeal, declaring total income of INR 27,60,550/- on 12.04.2022. As a result of search carried out u/s 132 of the Act in the case of Manoj Kumar Singh, his associates and other parties, case of the assessee was selected for scrutiny. In the case of the assessee also, a search u/s 132 of the Act was conducted at his business and residential premises. In the assessment order, AO observed that during the course of search, total cash of INR 59,28,700/- was found from the possession of assessee out of which cash of INR 57,00,000/- was sei....
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....okerage income from the cash transactions of loans found noted in the diary seized from the possession of assessee. Ld. AR further submits that application of such income elsewhere has not been established except claimed by the assessee of Rs. 6,30,000/- in AY 2019-20, therefore, it could be safely presumed that remaining income in the form of cash was available with the assessee. Ld. AR thus requested to allow the benefit of telescoping and set off of the cash found during the course of search out of said income. 37. Regarding the addition of INR 2.50 crores made u/s 69A of the Act, towards alleged cash payment for purchases of property at 489, Sector-45, Gurugram, ld. AR submits that the said document was neither signed by the assessee nor signed by the person who was alleged as the recipient of such sum i.e. Smt. Ruchi Sharma. Ld.AR submits that notice issued u/s 131 issued to Smt. Ruchi Sharma remained uncompiled with however no further efforts was made by the AO for verification from land revenue authorities. Ld. AR submits that for making addition u/s 69A, basic condition is that assessee should be found to be the owner jewellery, bullion, money or other valuable article w....
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....ed u/s 132(4) that it is an advance payment given by the assessee to Ms. Ruchi Sharma for purchase of property at 489, Sector-45, Gurgaon for a total sum of INR 9,14,50,000/- out of which INR 2.00 crore was paid as advance and balance was paid on or before 14.11.2020. In the said paper, it is further stated that INR 7,14,50,000/- is to be paid on or before 14.11.2020 and Rs. 1.00 crore as part on or before 02.09.2020 (50 cheque + 50 cash). The said paper is dated 04.08.2020 and signed by one P. Sharma on behalf of Ruchi Sharma and one Shri Rakesh Garg signed as witness. Ld. CIT DR submits that this paper is duly corroborated by the statement of the assessee recorded during the course of search wherein the assessee has accepted that he had paid the said amount to Smt. Ruchi Sharma out of the cash received from the sale of property owned by M/s Hector Enterprises in which he is one of the Directors. Accordingly, Ld. CIT DR prayed for the confirmation of the addition so made by the AO. 41. Heard the contentions of both the parties at length and perused the material available on records. With respect to the cash found during the course of search of INR 56,70,200/-, the assessee has ....
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....he return of income u/s 153A of the Act and also during the assessment proceedings. It is also well settled law that mere statement of the Assessee without any supporting corroborative evidence cannot justify the addition. 10. The Hon'ble Supreme Court in the case of CIT vs. Mantri Share Brokers (P) Ltd. SL.P (Civil) Diary No. 18434 of 2018, held that no addition u/s 69B of the Act can be made in the hands of an assessee where except statement of the Director of the assessed company offering additional income, there was no other material either in the form of cash, bullion, jewellery or document or in any other form to justify such additional income. Accordingly. the SLP, filed by the Revenue against the decision of Hon'ble Rajasthan High Court was dismissed. 11. Further in the case of Sanjay Singhal Vs. DCIT in ITA No. 708/CHD/2018 dated 20/09/2021, the Co-ordinate Bench of the Tribunal, Chandigarh Bench, deleted the addition in the similar circumstances, which is reproduced as under: - "However, during the course of hearing. Shri G. C. Srivastava has emphasised that in the case of Sanjay Singal, he has voluntarily disclosed Rs. 250 crores on acc....
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....n the officials used to obtain confessions from the assessee and stop further recovery of the material Such confessions have been retracted and then the addition could not withstand the scrutiny of the higher appellate authority, because no material was found supporting such addition. It is pertinent to observe that in a large number of authoritative pronouncements, it has been held that merely on the basis of declaration addition should not be made. The alleged declaration should be supported with unexplained expenditure or assets discernible in the seized material during the course of search, No such things was unearthed by the Revenue, therefore, decision relied upon by the Ld. CIT-DR in the case of Bhagirath Aggarwal Vs. CIT(Supra) is distinguishable on facts. This decision has already been considered by the Coordinate Bench while dealing with the case of father of the assessee. 81. After going through well-reasoned order in the light of material brought to our notice, we are of the view that issue in dispute in all these appeals is squarely covered by order of the Co-ordinate bench in the case of Shri Brij Bhusan Singal and others (supra), and hold that the long term ....