TaxTMI 
TaxTMI 
2026 (7) TMI 507
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....he facts and in the circumstances of the case and in law, Income-tax Appellate Tribunal, was right in law in upholding the additions of Rs. 20,00,000/- in respect of Ramesh Angana and Rs. 14,00,000/- in case of Vicky Shah for AY 2010-11? (b) Whether on the facts and in the circumstances of the case, the conclusion reached by Income-tax Appellate Tribunal, upholding the additions of Rs. 20,00,000/- in respect of Ramesh Angana and Rs. 14,00,000/- in case of Vicky Shah for AY 2010-11 was perverse and such as could be arrived at from the material on record or is reasonable?" 3. Before the Tribunal, the revenue challenged the order of the Commissioner of Income Tax (Appeal) [for short 'CIT(A)] for A.Y. 2011-12 being IT(SS)A No.69/Ahd/2016 whereas the assessee challenged the order of CIT(A) for A.Y. 2008-09 to 2011-12 being IT(SS)A Nos. 75 to 78/Ahd/2016. The questions of law raised in this appeal are referring only to IT(SS)A No. 77/Ahd/2016 for A.Y. 2010-11. The assessee raised the following grounds of appeal before the Tribunal in IT(SS)A No. 77/Ahd/2016 for A.Y. 2010-11: "1.2 The order passed u/s. 250 on 29.09.2015 for A.Y.2010-11 by CIT(A)-12, Abad partly confir....
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....re incorporated in the cash book, which was prepared on the basis of the seized materials. 3.3 The Assessing Officer made addition for the year under consideration as under: "Addition: (1) On account of unaccounted expenses on House Construction Rs. 19,02,597/-- (2) On a/c of other advances & interest Received/receivable Rs. 7,80,250/- (3) Principle amount Rs. 13,00,000/- (4) notings appearing in seized records Rs.18,81,832/- (5) daughter's marriage Rs. 8,90,000/- (6) investment in other shares (Capital Gain) Rs. 7,76,697/- (7) unaccounted dalali income Rs. 1,90,311/- (8) Principle amount advanced Rs. 75,00,000/- (9) Interest recd/receivables Rs. 31,50,000/- (10) Acrued interest Rs.19,06,000/- (11) Cash receipts on the basis of banakhat Rs. 14,00,000/-" 5. Being aggrieved by the aforesaid order, and with similar additions made for the A.Y. 2008-09, 2009-10 and 2011-12, the appellant assessee preferred appeals before the Commissioner of Income Tax (Appeals) [for short 'CIT(A)']. The CIT(A) passed a common order giving certain reliefs to the appellant-assessee. In relation to the amount of Rs. 20,25,....
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....F-6 but also on page no.16 of BF-2 and page no.13 and 14 of BF-10 which have been printed in the assessment order by the Id. AO. The contention of the appellant that the receipt of Rs. 20 lacs as per page 26 of BF-6 is from the hawala of outstanding amount from Jayesh Babulal has been rejected by the ld. AO on the ground that there is absolutely no evidence submitted by the appellant to support such contention. Further, and impliedly, the Id. AO based on other seized paper also rejects the contention of the appellant and therefore he brings to tax the amount of Rs. 20,25,000/- as principal amount and d further amount of Rs. 27,08,443/- as interest received on the basis of seized documents for various assessment years. 11.3 Before me, the Id. AR has in the main, relied upon the contentions raised before the Id. AO. The following written submissions are reproduced: i. Responsibility of liability of Rs. 20,00,000/- of Jayesh Babulal was taken by Ramesh Angana on 01/05/09. Kindly see page no.26. ii Relevant page of seized material is BF-6 page 26. Kindly see page no. 27. iii. Necessary entry in the books of the appellant for this transaction was pass....
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....dditionally, the seized papers printed by the Id. AO in the assessment order clearly bring out that even apart from the transactions of receipt of Rs. 20 lacs as appearing to be received between 29/10/2009 and 9/8/2010, a total receipt of more than Rs.33 lacs is also noted to have been received from Ramesh Angana as per BF-2 page no.26. The copy of page no.13 and 14 BF-10 written in Gujarati clearly shows the additional interest calculation and receipts from Ramesh Angana between the period 1/5/2009 and 9/8/2010, though the receipts appear to be matching with the dates mentioned on BF-6 page 26. No explanation seems to have been offered either before the ld. AO or before me also to cohesively explain the content of these seized papers in conformity with the contention that the date of 1/5/2009 as noted on page 26 of BF-6 would link the account of Ramesh Angana with that of Jayesh Babulal. I am therefore not persuaded by the submission of the Id. AR that the receipt of RS. 20,25,000/- as brought to tax by the ld. AO, representing the receipt of unaccounted advances made earlier than 29/10/2009. Thus, I hold that the addition of Rs. 20,25,000/- made by the Id. AO is based on credible....
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....A) by dismissing the appeals filed by the revenue as well as the assessee. 8. The Tribunal has recorded the facts for all the Assessment Years together without bifurcating the same year-wise, as the same were emanating from search proceedings and the Assessment Orders were passed under Section 153A of the Act by the Assessing Officer for the six Assessment Years differently as per the provision of the Act. The Tribunal, therefore, for findings given for A.Y 2011-12 in the case of the assessee in IT(SS)A 77/Ahd/2016, observed as under: "30. As regards IT(SS)A 77/Ahd/2016 for A.Y. 2010-11 filed by the assessee, the assessee has challenged the loan and advances of Rs. 29,500/- and advances to Ramesh Amngana to the effect of Rs. 13 lacs. The same argument was proposed by the ld. A.R. as taken in IT(SS)A 75/Ahd/2016. Hence, the said ground no. 2.1 (a) & (b) are dismissed. 31. As regards transaction with Vicky Shah and direction of interest on above said advances, the CIT(A) has rightly confirmed these additions as the transaction with Vicky Shah has been dealt with as per annexure A-5, page no. 1 to 35. The assessee executed various banakhats with Vicky Shah and the....
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....ts and decides whether they represent unaccounted receipts/investments. The Assessing Officer observed that the assessee derives income by way of commission i.e. the dalali as broker in real estate and income from other sources. Assessing Officer made addition of Rs. 1,47,200/- on account of investment and expenses incurred on the Vinzol land in cash. As regards loans and advances to Jayesh and Mahesh Shah, the Assessing Officer has also made addition to that effect. 28. Since in respect of loan and advances, the CIT(A) has read taken into account the detailed discussion and has Confyd 86,600/- to the extent which was not established by Elessee and therefore the ground taken by the assessee does not sustain. Hence, the appeal being IT(SS)A No. 75/Ahd/2016 of the assessee is dismissed. 10. The Tribunal has discussed the facts and the additions made by the Assessing Officer and modified by the CIT(A) in the appeal filed by the revenue for A.Y. 2011-12, relevant to the previous year in which the search was conducted and has observed the facts in detail as a findings of fact which reads as: "3.1 The Assessing Officer observed the following discrepancies in the book....
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....the loan given to Jayesh Shah and outstanding with the loan given to other individuals even though they are separate transactions. e) The assessee is carrying out various business activity, such as dalali in respect of property, money lending and investment in land and the funds of one business are utilized in another. By preparing the books of account after the date of search, claimed to have been made on the basis of seized records resulted into set off of one business against another business, in this case the assessee has also prepared the books of the assessee's wife and file the same at Rs. 8,90,000/- Thus the assessee had tried to reduce his undisclosed income by diverting the expense of marriage to her books of account. f) A perusal of the preliminary statement recorded on the date of search u/s 132(4), the assessee has given explanation to each individual transaction and offered the same as income. Subsequently, the assessee has tried to club one expenditure to the other income or vice versa without any concrete evidence, thus reducing the tax liability. Thus the statement u/s 132 (4) gains more reliability as there is ample possibility of afterthough....
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....ntiate his claim that he is also known as Satish Maharaj. j) On Page-25 of Ann. BF-2, the assessee has shown that Rs. 15000/- was given to Omji, this transaction pertains to 17.05.2007 but he has shown it as 17.05.2008. It may be noted that the entries both above and below this transaction is dated 17.05.2007. k) On Page 21 of Ann. BF-2, the assessee has mentioned that the amount is Rs. 75,000/- however, the actual figure is Rs. 80,000/- l) On Page 30 of Ann BF-10, there is a letter signed by Sarpanch of Laxmanpura which acknowledges that he has received Rs. 1 lac, however, no such entry is made in the assessee's books. m) On Page 11 of Ann. BF-10, the assessee has stated that the disclosure is of Rs. 499/- only and it is sundry expenses. However, during the post search proceedings he had admitted that the same is dalali receipts of Rs. 4,99,000/- n) On Page 25 of Ann. BF-6, the assessee has stated the disclosure is of Rs. 16300/- whereas in several instances he has considered the figures in thousands ('000). o) When there is shortage of fund in the cash book, the assessee has shown Disclosure amount. Therefore, the books do....
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....g Officer issued show cause notice as to why the amount of Rs. 27,06,080/- should not be taxed as assessee's unaccounted investment. After taking cognizance of the assessee's rebuttal/submissions, the Assessing Officer held that the assessee has incurred various expenditure for construction of his house and admitted that the same was unaccounted. The assessee during assessment proceedings contended that the expenditure was reflected in his books of accounts, however overall the books of account were rejected u/s. 145(1) and thus the assessee was unable to demonstrate the source of the expenditure as well as there was no evidence submitted. Hence, the addition on account of unaccounted expenditure on house construction was made on the basis of seized records, payment, expenditure. Thus addition of Rs. 2,45,326/- was shown in assessment year 2009-10, addition of Rs. 19,02,597/- was made in assessment year 2010-11 and addition of Rs. 5,58,157/- was made in assessment year 2011- 12. 3.4 The Assessing Officer regarding the marriage expenses of the daughter has made addition of Rs. 10,00,000/- for assessment year 2010-11 thereby stating that during the course of search no books ....
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....ssee's unaccounted capital deployed by him in money lending. The statement of Shri Jayesh C. Shah was recorded u/s. 131 of the Act wherein he stated that he had taken loans of Rs. 1.17 crore which was received in cash. He further submitted that he has not paid any interest as he had not borrowed the amount on interest from assessee i.e. Dilipbhai Purohit. The Assessing Officer has given a categorical finding that this claim of assessee is proved wrong as in the seized documents rate of interest charged and the computation thereof is clearly mentioned. The assessee mortgaged the property pertaining to Jayesh Shah's son in order to claim his dues. The substantive amount of the loan taken was repaid as the assessee's contention that assessee has not received any interest was not accepted by the Assessing Officer. The Assessing Officer categorically gave the finding that the scan copy of one of the seized documents (mentioned in page 25 of the assessment order) gives the calculation of interest @ 7% per month. Thus, the Assessing Officer made addition of Rs. 1,41,29,908/- in assessment year 2009-10 and Rs. 18,81,832/- for assessment year 2010-11. 3.6 The Assessing Officer furt....
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....in is without any basis or documentary evidence. With regard to non-receipt of interest, the assessee's claim was also rejected. Since the assessee is engaged in the business of money lending has taken sufficient pre-caution to ensure that he receives his interest on time. Thus, the Assessing Officer made addition on account of principal amount advanced to the extent of Rs. 75,00,000/- in assessment year 2010-11 and Rs. 1,01,00,000/- for assessment year 2011-12. Thus, totaling to addition of Rs. 1,76,00,000/-. The Assessing Officer further made addition on account of interest received/receivable to the extent of Rs. 31,50,000/- for assessment year 2010-11 and Rs. 81,92,000/- for assessment year 2011-12. 3.6 However, the Assessing Officer observed that on perusal of the impounded materials BF-2, BF-6 and BF-10 had reflected transactions made with R. Angana and the cash given on various dates to Rameshbhai Shah totaling to Rs. 25,0000/- and also an amount received back from him on various dates totaling to Rs. 34,000/- (Annexure BF-2 page no. 16). As regards Annexure BF-6, page no. 26, the Assessing Officer observed that on various dates from 29-10-2009 to 09-08-2010 S....
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....ollows:- (i) For A.Y.2006-07 Rs. 4,00,000/- (ii) For A.Y.2007-08 Rs. 50,000/- (iii) For A.Υ.2008-09 Rs. 6,18,130/- (iv) For A.Y.2009-10 Rs. 2,07,500/- (v) For A.Y.2010-11 Rs. 7,80,250/- (vi) For A.Y.2011-12 Rs. 21,52,371/- Rs. 42,08,251/- The Assessing Officer related to page 23 of impounded diary inventorised as BF-2 has observed that the page contains details of payments made to Shri Umeshbhai for purchase of land. The said payments aggregated to Rs. 7,00,025/-and the same was admitted by the assessee that the amounts mentioned was paid by the assessee in cash for purchase of a land at Ogan Village. This amount was paid on behalf of Umeshbhai, however the banakhat was in assessee's name. Since, there was no evidence that this land/payment was made by the said Shri Umeshbhai. The Assessing Officer made addition of Rs. 7,00,025/- as unaccounted and made addition to that extent. The addition was bifurcated in the relevant assessment year as follows:- Addition: (i) For A.Y.2008-09 Rs. 3,27,000/- (ii) For A.Y.2009-10 Rs. 2,48,025/- (iii) For A.Y.2011-12 Rs. 1,25,000/- Rs. 7,00,025....
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....- towards purchase of Honda City car in the hands of the assessee as the loan taken was also not recorded in the books of accounts as on the date of search even though the same was purchased in April, 2010. 3.8 The Assessing Officer in respect of page 1-8 of the diary inventorized BF-4 has observed that the details of expenses incurred since 2004-05 towards property purchase in Vinzol land which was recorded in the assessee's books has been noted in the said diary. The assessee filed reply and after taking consideration of the same the Assessing Officer held that the since books were rejected and these transactions pertained to a period for more than 6-7 years. The part of purchase consideration was paid in cash by the assessee and hence the entire transaction was carried in cash. Thus, the addition was made to the extent of Rs. 12,79,890/- in total bifurcating it as Rs. 4,28,530/- for assessment year 2005-06 Rs. 6,85,910/- for assessment year 2006-07 Rs. 18,250/- for assessment year 2007-08 and Rs. 1,47,200/- for assessment year 2008-09. 3.9 In respect of search proceedings at the assessee's residence, loose paper files inventorized A-3 was seized and in page nos....
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....lected in the cash book made after the date of search. After taking cognizance of the assessee's reply, the Assessing Officer made addition of Rs. 14,00,000/- for assessment year 2010-11." 11. After considering the above facts which were recorded by the Tribunal on the basis of the assessment order as well as the documents placed on record by the parties, the Tribunal has considered the issue of the amount received by assessee from Mr. Ramesh Angna as well as Mr. Mahesh Chhotalal in addition to Rs. 91 lakhs being deleted by CIT(A), as under: "12. As regards ground no. 4, the ld. D.R. submitted that the CIT(A) erred in deleting the addition of Rs. 91,00,000/-on account of unaccounted principal amount advanced through Mahesh Shah. The ld. D.R. relied upon the assessment order wherein it was categorically mentioned that no evidence was submitted to show out of total loan taken, the amounts of Rs. 75,00,000 pertains to Shri Jayesh Shah. The reply of the assessee that the books of accounts are prepared on cash basis and no interest was received by the assessee was not considered. Even, the statement given by Mahesh Chhotalal u/s. 131 and Jayesh Shah was considered. The ld. A....
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....search on 16-03-2011 and 20-05-2011 before the DDIT, the assessee stated that the books of account on the basis of seized material will be prepared from assessment year 200-06-07 and undisclosed income will be disclosed u/s. 153A for various years. The amount found appeared in the books of account prepared after search and therefore the CIT(A) has rightly deleted the addition on the basis of double taxation. 17. We have heard both the parties and perused all the relevant material available on record. It is pertinent to note that the CIT(A) has categorically restricted the relief to the extent of Rs. 14,64,000/- as this is the said amount which was the seized amount in cash. The assessee has admitted to the unaccounted income but while filing the return u/s. 153A has disclosed amounts which were the income of the assessee from assessment year 2006-07 till relevant assessment in the present case. There is no need to interfere with the findings of the CIT(A). Thus, ground no. 6 is dismissed." 13. Thus, the Tribunal, after considering the relief given by the CIT(A) for the Assessment Years 2008-09 to 2011-12 under consideration and in view of the observations made in each o....