TaxTMI 
TaxTMI 
2005 (3) TMI 389
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.... law, erred in deleting the addition of Rs. 20,35,000 made by the AO on account of undisclosed investments/loans/advances for the block period 1st April, 1988 to 19th Nov., 1998. 2. That the learned CIT(A) has, on facts as well as in law, erred in deleting the addition of Rs. 8,83,975 made by the AO on account of interest earned by the assessee. 3. The relevant facts, briefly stated, are that there was a search at the premises of the assessee and her husband as also at the business premises on 19th Nov., 1998. The respondent is also a regular taxpayer and so is her husband. The respondent along with her husband had substantial shareholdings in M/s Bonn Nutrients (P) Ltd. The respondent was drawing a salary of Rs. 3 lakhs per annum fro....
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....usband in SOF before the Settlement Commission and, therefore, the entire documents are to be considered in the hands of her husband, namely, Shri Manjit Singh. The AO however, was not convinced with the claim of the assessee. As per the AO, since the document seized during the course of search was in handwriting of the assessee, the addition was required to be made in the hands of the assessee. The addition of Rs. 20,35,000 was made on account of document No. 3 of Annex. 8 on account of advances. A further sum of Rs. 8,83,975 was added on the basis of the same document as interest earned by the assessee. Assessee appealed to the CIT(A) against the additions made by the AO. The CIT(A), Ludhiana, vide impugned order dt. 30th March, 2001, hel....
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....s husband as also the order of the Settlement Commission dealing with the income derived from organizing kitties and earning of interest. The learned counsel for the assessee also invited our attention to the affidavit of the assessee's husband wherein he has categorically stated that the entire documents seized in the course of search belonged to him and that he will be responsible to be assessed in respect of the income as per the said documents. Our attention was also invited to the statement of the respondent as well as that of her husband wherein it has specifically been declared that the document being Annex. 8 related to the husband of the assessee and that the respondent had merely made the entries at his instance. It was accordingl....
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....ly kitty, which also shows earning of interest which has been owned by my husband. Q. Do you admit any income or investment appears in the documents seized from your residence? Ans. No, all income and investments, as I stated pertain, to my husband. Though, some of the entries regarding family kitties are in my handwriting since I used to assist my husband." Relevant portion of the statement of Shri Manjit Singh, husband of the assessee, is also reproduced as under: "As regards statement of my wife, Smt. Prabhjot Kaur, I am in total agreement and explain that her handwriting is appearing in some of the documents as she was assisting me in my business. Therefore, whatever income or investment has been recorded by her reflected in....
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....d there is mention of express 'kist lena hai'. Similarly, pp. 45 and 49 of IInd APB were cited wherein 'ghata' has been clearly written. It was stated that certain contributions were made by Manjit Singh, his wife or family members towards kitties and the funds of such contributions had been found during the course of search. Certain payments were also claimed to have been received during the start or during the course of running of kitties depending upon the requirements and there was rotation of funds. CIT(A)'s order dt. 30th March, 2001 - p. 11 of IInd APB - where factual position had been detailed was cited in support of the claim that Shri Manjit Singh's wife, Parbhjot Kaur, used to keep the accounts of various members of kitties. It w....