Sh SAS Servizio Ltd., Gurgaon V. ACIT, New Delhi

CO 254/DEL/2010

• Counselvise Citation: [2012] 122 COUNSELVISE.COM (IT) 7168 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 9 month(s) 4 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 25-05-2012
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: G
• Next Hearing Date: 14-05-2012
• Assessment Year: 2007-2008
• Appeal Filed On: 20-08-2010
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: NIRANJAN KOULI
• Assessee Lawyers: A K JAIN; S K MAINI CAS
• Keywords: Search and seizure; Assessment record
• Section: 133A; 153A; 131; 132; 15

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH G : NEW DELHI) SHRI U.B.S. BEDI, JUDICIAL MEMBER AND BEFORE SHRI B.C. MEENA, ACCOUNTANT MEMBER ITA NO.2836/DEL./2010 (ASSESSMENT YEAR : 2007-08) ACIT, C.C. 5, VS. M/S. SAS SERVIZIO LIMITED, NEW DELHI. 10 TH FLOOR, TOWER D, GLOBAL BUSINESS PARK, M.G. ROAD, GURGAON (HARYANA). (PAN : AAACR4452L) CO NO.254/DEL/2010 (IN ITA NO.2836/DEL./2010) (ASSESSMENT YEAR : 2007-08) M/S. SAS SERVIZIO LIMITED, VS. ACIT, C.C. 5, 10 TH FLOOR, TOWER D, NEW DELHI. GLOBAL BUSINESS PARK, M.G. ROAD, GURGAON (HARYANA). (PAN : AAACR4452L) (APPELLANT) (RESPONDENT) ASSESSEE BY : S/SHRI A.K. JAIN & S.K. MAINI, CAS REVENUE BY : SHRI NIRANJAN KOULI, CIT DR ORDER PER B.C. MEENA, ACCOUNTANT MEMBER : THIS APPEAL FILED BY THE REVENUE AND THE CROSS OBJE CTION FILED BY THE ASSESSEE EMANATE FROM THE ORDER OF CIT (APPEALS)-I, NEW DELHI DATED 30.11.2009 FOR ASSESSMENT YEAR 2007-08. ITA NO.2836/DEL./2010 CO NO.254/DEL/2010 2 2. THERE WAS A DELAY IN FILING THE APPEAL BY THE RE VENUE. WE HAVE HEARD BOTH THE SIDES ON THE ISSUE AND AFTER HEARING, WE C ONDONE THE DELAY AND ADMIT THE APPEAL TO BE DECIDED ON MERITS. 3. THE GROUNDS OF APPEAL READ AS UNDER :- 1. THE ORDER OF THE LD. CIT (APPEALS) IS NOT CORRE CT IN LAW AND FACTS. 2. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) HAS ERRED IN LAW AND FACTS OF THE CASE IN DE LETING THE ADDITION OF RS.50,00,000/- MADE BY THE AO AS UNEXPL AINED CASH FOUND FROM THE POSSESSION OF ONE OF ITS EMPLOY EES VIZ. SH. SANDEEP KALSI. 3. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) HAS ERRED IN LAW AND FACTS OF THE CASE IN PL ACING RELIANCE ON ASSESSEE'S VERSION THAT THE CASH WAS A WITHDRAWAL FROM BANK WHEREAS IN FACT THE WITHDRAWAL (ONLY RS.3 0 LACS) WAS MADE FROM THE BANK ON 10.08.2006 AND THE CASH O F RS.50 LACS WAS SEIZED ON 8.9.2006, I.E. ABOUT A MONTH AFT ER THE WITHDRAWAL WAS MADE. 4. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) HAS FAILED TO APPRECIATE THE FACT THAT APART FROM THE CASH OF RS.50 LACS SEIZED FROM SH. SANDEEP KALSI, A NOTHER CASH OF RS.30,02,750/- WAS ALSO FOUND DURING SURVEY U/S 133A ON THE ASSESSEE COMPANY. 5. THE APPELLANT CRAVES LEAVE TO ADD, ALTER OR AMEN D ANY/ALL OF THE GROUNDS OF APPEAL BEFORE OR DURING THE COURS E OF THE HEARING OF THE APPEAL. 4. THE GROUND OF ASSESSEES CROSS OBJECTION READ AS UNDER :- 1. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF T HE RESPONDENTS CASE, THE LEARNED COMMISSIONER OF INCO ME TAX (APPEALS) ERRED IN LAW IN UPHOLDING VALIDITY OF THE ASSESSMENT ITA NO.2836/DEL./2010 CO NO.254/DEL/2010 3 PROCEEDINGS UNDER SECTION 153C READ WITH SECTION 15 3A OF THE INCOME-TAX ACT, 1961. 5. THE ASSESSEE IS A PRIVATE LIMITED COMPANY ENGAGE D IN THE BUSINESS OF INFRASTRUCTURE SERVICES, ENGINEERING OPERATION & MA INTENANCE SERVICES, ELECTRICAL CONTRACTING AND WATER SUPPLY OPERATION & MAINTENANCE. THE BRIEF FACTS OF THE CASE ARE THAT THE RETURN OF INCOME WAS FILED ON 01.11.2007 DECLARING INCOME AT RS.77,75,050/-. THE ASSESSMENT WAS COMPLETED ON 29.12.2008 AT A TOTAL INCOME OF RS.1,27,75,050/-. THE ASSESSING OFFICER MADE AN ADDITION OF RS.50,00,000/- ON ACCOUNT OF TH E CASH SEIZED FROM SUNDEEP KALSI WHO WAS TRAVELING FROM DELHI TO GOA. RS.50,10,000/- WAS FOUND WITH HIM AT AIRPORT TERMINAL AND AN AMOUNT OF RS.50,00,000/- WAS SEIZED. SUNDEEP KALSI STATED THAT THE MONEY WAS BE LONGING TO SAS SERVIZIO LTD. (THE ASSESSEE) AND IN THE STATEMENT AT THE TIM E OF SEARCH, HE STATED THAT HE IS AN EMPLOYEE OF SAS SERVIZIO LTD. IN THE STATEME NT RECORDED AT THE TIME OF SEARCH, SHRI SUNDEEP KALSI STATED THAT THIS AMOUNT WAS GIVEN TO HIM BY SHRI VED GOEL AND SHRI SURENDER SHARMA AS FOLLOWING :- (I) RS.10 LACS BY SHRI VED GOEL & SURENDER SHARMA ON 07.09.2006. (II) RS.30 LACS BY SHRI VED GOEL & SURENDER SHARMA ON 4 5 DAY BACK. (III) RS.10 LACS BY SHRI VED GOEL ON 07.09.2006. ITA NO.2836/DEL./2010 CO NO.254/DEL/2010 4 A SURVEY OPERATION WAS ALSO CARRIED OUT AT THE BUSI NESS PREMISES OF THE ASSESSEE (SAS SERVIZIO LTD.). CASH OF RS.30,02,750 /- WAS ALSO FOUND AT THESE PREMISES. THE ASSESSING OFFICER MADE AN ADDITION O F RS.50,00,000/- AS HE DID NOT BELIEVE THE EXPLANATION PROVIDED BY THE ASS ESSEE. THE CIT (A) HAS DELETED THE ADDITION BY HOLDING AS UNDER :- 7. I HAVE CONSIDERED THE SUBMISSION AS WELL AS CON TENTIONS OF THE APPELLANT AND THE ASSESSMENT ORDER OF AO MAKING THE IMPUGNED ADDITION. I HAVE PERUSED THE PAPER BOOK F ILED BY THE APPELLANT WHICH IS PLACED ON RECORD. I FIND FORCE IN THE CONTENTIONS PUT FORTH BY THE APPELLANT AND CASES RE LIED UPON. KEEPING IN VIEW OF FACTS OF THE CASE AND EVIDENCE F ILED BY THE APPELLANT BEFORE THE AO, THE CASH OF RS.50 LACS FOU ND IN THE POSSESSION OF SUNDEEP KALSI IS DULY EXPLAINED AS TH E SAME IS AS PER THE BOOKS OF ACCOUNTS OF THE APPELLANT IMPOUNDE D DURING THE SURVEY UNDER SECTION 133A OF THE ACT, WHICH IS VERI FIED BY THE AO DURING THE COURSE OF ASSESSMENT PROCEEDINGS. THE AO HAS MERELY RELIED ON THE STATEMENTS RECORDED DURING THE COURSE OF SURVEY AND HAS NOT CONSIDERED THE EVIDENCES AND EXP LANATION FILED BY THE APPELLANT DURING THE COURSE OF ASSESSM ENT PROCEEDINGS. THE APPELLANT COMPANY HAS DULY EXPLAIN ED THE SOURCE OF THE CASH FOUND AND PURPOSE OF WITHDRAWAL OF CASH FROM BANK ACCOUNT AND REASONS FOR HOLDING THE SAID CASH FOR A LONG PERIOD, WHICH HAS NOT BEEN REBUTTED BY THE AO BY BR INGING ANY MATERIAL IN ASSESSMENT RECORDS AND ALSO FAILED TO B RING ANY EVIDENCE ON RECORD THAT CASH WITHDRAW FROM BANK ACC OUNT HAS ALREADY BEEN UTILIZED BY THE APPELLANT FOR PURPOSE OTHERWISE THAN AS EXPLAINED BY APPELLANT. THE AO MADE ADDITION ONL Y IN THE ASSESSMENT YEAR 2007-08 IN WHICH CASH HAS BEEN SEIZ ED FROM THE CONSULTANT OF THE APPELLANT COMPANY AS THE ACCOUNT ING METHODS ADOPTED BY THE APPELLANT IS DEFECTIVE, BUT THE SAME ACCOUNTING METHOD HAS BEEN ADOPTED BY THE APPELLANT FOR THE OT HER FINANCIAL YEARS RELEVANT TO ASSESSMENT YEARS 2000-01 TO 2006- 07, WHICH ARE ALSO ASSESSED BY HIM AND THE BOOK RESULTS AND A CCOUNTING METHODS ADOPTED BY THE APPELLANT FOUND TO BE CORREC T BY THE AO. HENCE, I AM OF THE OPINION THAT THE AO IS NOT JUSTI FIED BOTH IN FACT AND LAW IN MAKING ADDITION OF RS.50 LACS IN TH E HANDS OF ITA NO.2836/DEL./2010 CO NO.254/DEL/2010 5 THE APPELLANT, SO THE SAME IS HEREBY DELETED. IN TH E RESULT THE APPELLANT GETS RELIEF OF RS.50 LACS. 6. THE REVENUE HAS CHALLENGED THE DELETION OF ADDIT ION ON THAT BASIS THAT THERE WAS A GAP OF ABOUT A MONTH BETWEEN THE CASH W ITHDRAWAL AND CASH FOUND SEIZED. REVENUE ALSO PRAYED THAT ANOTHER CAS H OF RS.30,02,750/- WAS FOUND AT THE PREMISES OF THE ASSESSEE DURING THE SU RVEY OPERATION U/S 133A OF THE INCOME-TAX ACT, 1961 WHICH HAS TO BE TAKEN INTO CONSIDERATION FOR DECIDING THE ISSUE. 7. WHILE PLEADING ON BEHALF OF THE REVENUE, THE LD. DR SUBMITTED THAT WHEN THE SEARCH WAS CONDUCTED ON 08.09.2006, SHRI S UNDEEP KALSI WHO WAS ABOUT TO TRAVEL ON THE AIR SAHARA FLIGHT FROM DELHI TO GOA. AT THAT TIME, HE WAS FOUND IN POSSESSION OF RS.50,10,000/-. IN HIS STATEMENT, SHRI KALSI HAS STATED THAT THE AMOUNT WAS GIVEN TO HIM BY THE OFFI CIALS OF SAS SERVIZIO LTD. (THE ASSESSEE). SHRI KALSI HAS ALSO STATED THAT RS .10,00,000/- WAS GIVEN BY SHRI VED GOEL, MANAGER (FINANCE) AND SHRI SURENDER SHARMA, CHIEF FINANCIAL OFFICER ON 07.09.2006, RS.30,00,000/- WAS GIVEN 4 5 DAYS BACK AT HIS HOME BY SHRI VED GOEL AND SHRI SURENDER SHARMA AND RS.10,00,000/- WAS GIVEN TO HIM ON 07.09.2006 BY SHRI VED GOEL. THE S TATEMENT OF SHRI SURENDER SHARMA, CHIEF FINANCIAL OFFICER AND SUNIL DOBHAL WERE ALSO RECORDED. LD. DR PLEADED THAT THERE IS A VARIATION IN THE STATEMENT MADE BY SHRI SUNDEEP KALSI AT THE TIME OF SEARCH OPERATION AT AIRPORT AND THE STATEMENT ITA NO.2836/DEL./2010 CO NO.254/DEL/2010 6 OF SHRI SURENDER SHARMA WORKING AS CHIEF FINANCIAL OFFICER AND SUNIL DOBHAL RECORDED AT THE TIME OF SURVEY OPERATION U/S 133A OF THE ACT. AS PER SHRI SURENDER SHARMA, THE AMOUNT OF RS.50,00,000/- WAS HANDED OVER TO SUNDEEP KALSI ON THE MORNING OF THE DAY WHEN THE SE ARCH TOOK PLACED AND THIS FACT HAS BEEN BROUGHT TO HIS NOTICE BY SHRI SU NIL DOBHAL. SHRI SUNIL DOBHAL IN HIS STATEMENT STATED THAT THE AMOUNT OF R S.50,00,000/- WAS HANDED OVER TO SUNDEEP KALSI ON 08.09.2006. LD. DR PLEADE D THAT THERE WAS VARIATION IN THE STATEMENTS. THEREFORE, CIT (A) WA S NOT JUSTIFIED IN DELETING THE ADDITION. FURTHER LD. DR ALSO PLEADED THAT THE CASH OF RS.30,02,750/- WAS ALSO FOUND DURING THE SEARCH OPERATION AT THE PREMI SES OF THE ASSESSEE COMPANY AT GURGAON AND THE CASH BALANCE ON THE DAY WAS ONLY RS.42,33,069. THEREFORE, THE CIT (A) WAS NOT JUSTIFIED TO TREAT T HE AMOUNT AS EXPLAINED. LD. DR ALSO PLEADED THAT SHRI SUNDEEP KALSI HAS RECEIVE D THE AMOUNT FROM IMPREST ACCOUNT AS PER THE BOOKS WHICH WERE COMPLET ED UP TO 07.09.2006 IN SMALL AMOUNTS, BUT THERE IS NO MENTION OF CASH OF R S.50,00,000/- WHICH HE CLAIMED AS HANDED OVER TO HIM ON VARIOUS OCCASIONS. IN VIEW OF THESE FACTS, THE LD. DR PLEADED THAT IT CAN BE CONCLUDED THAT CA SH FOUND AT THE AIRPORT WAS NOT EXPLAINED CASH BELONGING TO THE ASSESSEE. LD. DR HAS ALSO FILED WRITTEN SUBMISSIONS DURING THE HEARING WHICH READ AS UNDER :- IT IS SUBMITTED THAT THE ORDER OF THE CIT(A) LACK S CLARITY AS TO HOW THE CASH OF RS.50,00,000/- FOUND DURING THE SEARCH ON 08.09.2006 AND CASH OF RS.30,02,750/- FOUND DURING THE SURVEY U/S. 133A ON 8.9.2006 (TOTAL RS.80,12,750/-) IS EXP LAINED IN THE ITA NO.2836/DEL./2010 CO NO.254/DEL/2010 7 BOOKS OF ACCOUNTS. IT IS NOT CLEAR FROM THE ORDER O F THE CIT(A) THAT THE ABOVE CASH IS EXPLAINED IN THE BOOKS OF AC COUNTS OF THE ASSESSEE. 2. DURING THE COURSE OF THE SURVEY CONDUCTED IN THE OFFICE PREMISES OF THE ASSESSEE ON 08.09.2006, CASH OF RS. 30,02,750/- WAS FOUND. BUT AS PER CASH BOOK, CASH IN HAND AS ON 8.9.2006 WAS RS.42,33,069/- ONLY. THERE ARE ALSO SOME ACTUAL UNENTERED CASH VOUCHERS FOUND DURING THE SURVEY. THEREFORE, C ASH IN HAND AS PER CASH BOOK IS LIKELY TO BE LESS THAN RS.42,33 ,069/-. 3. DURING THE SEARCH AND SEIZURE OPERATION CONDUCTE D AT THE AIRPORT AND SURVEY OPERATION CONDUCTED IN THE OFFIC E PREMISES OF THE ASSESSEE STATEMENTS OF SEVERAL EMPLOYEES OF THE ASSESSEE WERE RECORDED ON 08.09.2006. THE STATEMENT OF SHRI SUNDEEP KALSI RECORDED U/S. 132(4) DURING THE SEARCH AND SE IZURE OPERATION CONDUCTED AT THE AIRPORT AND THE STATEMEN TS OF SHRI SURENDER SHARMA AND SHRI SUNIL DOBHAL RECORDED DURI NG THE SURVEY U/S.133A CONDUCTED IN THE OFFICE PREMISES AR E CONTRADICTORY. SHRI KALSI IN THE STATEMENT U/S.132( 4) STATED THAT RS.10.00,000/- WAS GIVEN TO HIM ON 07.09.2006 BY SH RI VAID GOYAL, MANAGER(FINANCE) AND SHRI SURENDER SHARMA, C HIEF FINANCIAL OFFICER. RS.30,00,000/- WAS GIVEN TO HIM 4/5 DAYS BEFORE BY SHRI VAID GOYAL AND SHRI SURENDER SHARMA. RS.10,00,000/- WAS GIVEN TO HIM BY SH VAID GOYAL ON 07.09.2096. 4. IN THE SURVEY CONDUCTED ON 08.09.2006 IN THE OF FICE PREMISES OF THE ASSESSEE. SHRI SURENDER SHARMA, FIN ANCE CONTROLLER SAID THAT RS.50,00,000/-WAS GIVEN TO SUN DEEP KALSI BY SHRI SUNIL DOBHAL IN THE MORNING OF 08.09.2006. FURTHER, SH DOBHAL IN HIS STATEMENT CONFIRMED THAT RS.50,00,000 /- WAS GIVEN TO SH KALSI IN THE MORNING OF 08.09.2006. 5. THE PAYMENT OF RS.20,00,000/- ON 07.09.2006 AND RS.30,00,000/-, 4/5 DAYS BEFORE 08.09.2006 AS PER S TATEMENT OF SHRI KALSI IS NOT RECORDED IN THE BOOKS OF THE ASSE SSEE. SIMILARLY, PAYMENT OF RS.50,00,000/- IN THE MORNING OF 08.09.2 006 AS PER STATEMENT OF SHRI DOBHAL AND SH SURENDER SHARMA ARE NOT RECORDED IN THE BOOKS OF ACCOUNTS OF THE ASSESSEE. THE IMPREST ACCOUNT IS MAINTAINED BY THE ASSESSEE IN RESPECT OF THE EXPENSES INCURRED. THE IMPREST ACCOUNT HAD SHOWN ENTRY OF ITA NO.2836/DEL./2010 CO NO.254/DEL/2010 8 RS.30,00,000/- ON 10.8.2006, WHEREAS SHRI KALSI STA TED THAT RS.30,00.000/- WAS GIVEN TO HIM 4/5 DAYS BEFORE 08. 09.2006. THERE IS A GAP OF ALMOST 30 DAYS. FURTHER THE IMPRE ST ACCOUNT DOES NOT SHOW ANY CASH OF RS.30,00,000/- PAID TO SH RI KALSI 4/5 DAYS BEFORE 08.09.2006 AND RS.20,00,000/-ON 07.09.2 006. NEITHER THE IMPREST ACCOUNT SHOWS PAYMENT OF RS.50 LACS TO SHRI KALSI ON 08.09.2006. 6. IF RS.50,00,000/- WAS PAID TO SHRI KALSI OUT OF IMPREST ACCOUNT, THE SAME SHOULD HAVE BEEN ACCOUNTED FOR. BECAUSE PAYMENT OF RS.7,250/- ON 18.08.2006, RS.15,000/- O N 24.08.2006 AND RS.42,000 ON 07.09.2006 TO SHRI KALS I ARE ACCOUNTED FOR IN THE IMPREST ACCOUNT. 7. THEREFORE, IT IS EVIDENT THAT CASH OF RS.50,00, 000/- WAS NEITHER ACCOUNTED FOR IN THE CASH BOOK NOR IN THE I MPREST ACCOUNT OF THE ASSESSEE. THEREFORE, ON THE FACTS AND IN THE CIRCUMSTANCES, THE CIT(A) HAD ERRED IN LAW AND FACTS IN DELETING T HE ADDITION OF RS.50,00,000/- MADE BY THE A.O. AS UNEXPLAINED CASH FOUND FROM THE POSSESSION OF SHRI SUNDEEP KALSI. 8. ON THE OTHER HAND, THE LD. AR SUBMITTED THAT SUN DEEP KALSI WHO WAS CARRYING THE CASH ON BEHALF OF THE ASSESSEE TO GOA FOR MAKING THE PAYMENT IN RESPECT OF THE ALLOTMENT OF THE LAND ALLOTTED BY TH E INFO TECH CORPORATION OF GOA LTD., A GOVERNMENT OF GOA UNDERTAKING. THE NEC ESSARY EVIDENCE ARE PLACED AT PAGES 99 & 100 OF THE PAPER BOOK. LD. AR PLEADED THAT ASSESSEE WAS ALLOTTED A PLOT AT RAJIV GANDHI IT HABITAT FOR WHICH A LETTER WAS ISSUED BY INFO TECH CORPORATION OF GOA LTD. ON 01.08.2006 AND AS PER THIS LETTER, THE ASSESSEE HAS TO MAKE PAYMENT FOR THE ALLOTMENT OF T HE PLOT AT RAJIV GANDHI IT HABITAT @ RS.4,600/- PER SQ.MT. AND ASSESSEE HAS TO GIVE ACCEPTANCE BY 07.08.2006. THE OTHER LETTER FROM INFO TECH CORPOR ATION OF GOA LIMITED, WHICH IS PLACED AT PAGE 100 OF THE PAPER BOOK, IS D ATED 16.08.2006. AS PER ITA NO.2836/DEL./2010 CO NO.254/DEL/2010 9 THIS LETTER, THE BOARD OF DIRECTORS OF INFO TECH CO RPORATION OF GOA LTD. APPROVED THE ALLOTMENT OF PLOT ADMEASURING 41240.52 SQ.MTS. @ RS.4,600/- PER SQ. MT. THE ASSESSEE HAD TO MAKE 30% OF THE PA YMENT WITHIN 15 DAYS FROM THE RECEIPT OF THE LETTER. FURTHER, THE ASSES SEE WAS UNDER URGENT NEED TO MAKE THE PAYMENT AT GOA. THE REVENUES CONTENTION THAT THERE WAS GAP OF ABOUT ONE MONTH BETWEEN THE WITHDRAWAL OF RS.30,00, 000/- ON 10.08.2006 FROM THE BANK OF THE ASSESSEE AND THE SEIZURE AT AI RPORT ON 08.09.2006 HAS NO MEANING. REVENUE HAD NOT PROVED ANYTHING TO SUPPOR T THIS SUSPICION THAT MONEY WITHDRAWN FROM THE BANK ACCOUNT HAD BEEN UTIL IZED SOMEWHERE ELSE. THE EMPLOYEE OF THE ASSESSEE, SUNDEEP KALSI WAS TRA VELING FROM DELHI TO GOA FOR MAKING THE URGENT PAYMENT IN RESPECT OF THE PLO T ALLOTTED AND AT THE BEGINNING OF THE INTERCEPTION, SUNDEEP KALSI HAS ST ATED THAT MONEY WAS BELONGING TO THE ASSESSEE AND HE HAS ALSO STATED HO W HE HAS RECEIVED THE MONEY. THE PURPOSE AND URGENCY OF THE TAKING OF TH E CASH WAS ALSO EXPLAINED BY SUNDEEP KALSI HIMSELF IN HIS STATEMENT TO ANSWER TOE QUESTION NO.6 (PLACED AT PAGE 56 OF THE PAPER BOOK). THE ASSESSE E WAS HAVING CASH BALANCE OF MORE THAN RS.82 LACS ON THE DATE OF SURVEY AND S EARCH ITSELF. THIS FACT IS EVIDENT FORM THE SEIZED MATERIAL ITSELF WHICH ARE P LACED AT PAGES 83 TO 86 OF THE PAPER BOOK. THE PAGES 83 TO 85 ARE EXTRACT FRO M ANNEXURE 1 WHICH IS CASH BOOK OF THE ASSESSEE WHICH SHOWS THAT THE CLOS ING BALANCE WAS RS.42,33,069/- AND PAGE 86 IS THE LEDGER ACCOUNT OF OFFICE IMPREST WHICH ITA NO.2836/DEL./2010 CO NO.254/DEL/2010 10 REFLECTS THE DEBITS OF CASH OF RS.30,00,000/- ON 08 .08.2006 AND RS.10,00,000/- ON 07.09.2006. THUS, IN TOTAL, THE CASH BALANCE ON THE DAY OF SEARCH WAS OF MORE THAN RS.82 LACS OUT OF WHICH RS.50,00,000/- WA S FOUND WITH SUNDEEP KALSI AND RS.30,02,750/- WAS FOUND DURING THE SURVE Y OPERATION U/S 133A AT THE PREMISES OF THE ASSESSEE. THEREFORE, THE CIT ( A) HAS RIGHTLY DELETED THE ADDITION AND THERE IS NO MERIT IN THE APPEAL OF THE REVENUE. LD. AR PLEADED TO DISMISS REVENUE APPEAL. 9. WE HAVE HEARD BOTH SIDES. SUNDEEP KALSI, AN EMP LOYEE OF THE ASSESSEE WAS INTERCEPTED BY THE INCOME-TAX DEPARTMENT AT AIR PORT WHILE HE WAS TRAVELING FROM DELHI TO GOA AND RS.50,10,000/- WAS FOUND IN HIS POSSESSION. OUT OF WHICH, THE INCOME-TAX DEPARTMENT SEIZED RS.5 0,00,000/- BY EXECUTING A WARRANT OF SEARCH. THE STATEMENT OF SUNDEEP KALS I WAS RECORDED AT THE TIME OF SEARCH ITSELF WHICH IS PLACED AT PAGES 54 TO 62 OF THE PAPER BOOK. IN HIS STATEMENT, SHRI SUNDEEP HAS STATED THAT THE CASH WH ICH HE WAS CARRYING WAS BELONGING TO SAS SERVIZIO LTD. IN ANSWER TO QUESTI ON NO.6, HE HAS ALSO MENTIONED THE PURPOSE FOR WHICH CARRYING THE CASH T O GOA. IN THE STATEMENT, HE HAD ALSO EXPLAINED THE URGENCY FOR CARRYING THE CASH THAT IT WAS IS THE LAST DATE FOR PAYMENT FOR WHICH WHOLE OF THE MONEY COULD NOT BE ARRANGED. SHRI KALSI HAS ALSO STATED THE SOURCE OF THE MONEY FROM WHERE HE GOT IT. SHRI KALSI HAS ALSO STATED THAT HOW HE RECEIVED THE AMOUNT FRO M THE OTHER EMPLOYEES OF THE ASSESSEE COMPANY (ANSWER TO QUESTION NO.8). SH RI KALSI HAS ALSO ITA NO.2836/DEL./2010 CO NO.254/DEL/2010 11 CATEGORICALLY STATED THAT HE HAS NOT SIGNED ANY ACK NOWLEDGEMENT OR RECEIPT OR ANY OTHER PAPER FOR THE RECEIPT OF CASH. SHRI KALS I WAS ALSO CARRYING A LETTER ISSUED BY STANDARD CHARTERED BANK DATED 10.08.2006 CONFIRMING THAT SAS SERVIZIO LTD. HAS WITHDRAWN A SUM OF RS.30,00,000/- FROM JMO, REGION SQUARE, GURGAON BRANCH ON 10.08.2006. ALL THESE FA CTS CLEARLY ESTABLISH THAT MONEY WAS BELONGING TO THE ASSESSEE COMPANY ONLY. PROTECTIVE ASSESSMENT MADE IN THE HANDS OF SUNDEEP KALSI HAD BEEN DELETED BY CIT (A) AND DELETION UPHELD BY ITAT, BENCH G, DELHI IN ITS ORDER DATED 23.03.2011 IN ITA NO.2835/DEL/2010. THE RELEVANT PORTION OF ORDER IS REPRODUCED UNDER :- 4. UPON ASSESSEES APPEAL LD. COMMISSIONER OF INCO ME TAX (APPEALS) ELABORATELY CONSIDERED THE ISSUE AND HELD AS UNDER:- I HAVE CONSIDERED THE SUBMISSION AS WELL AS CONTE NTIONS OF THE APPELLANT AND THE ASSESSING OFFICER MAKING THE IMP UGNED ADDITION. I HAVE PERUSED THE PAPER BOOK FILED BY THE APPELLA NT WHICH IS PLACED ON RECORD. I FIND FORCE IN THE CONTENTIONS PUT FORTH BY THE APPELLANT AND CASES RELIED UPON. I AM OF THE OPINI ON THAT THE ASSESSING OFFICER IS NOT JUSTIFIED IN MAKING ADDI TION OF RS.50 LACS IN THE HANDS OF THE APPELLANT ON PROTECTIVE BASIS ON ACCOUNT OF CASH FOUND IN HIS POSSESSION EVEN WHEN M/S SAS SERVIZIO PRIVATE LIMITED HAS ACCEPTED THE FACT THAT THE SAID CASH BELONG TO THE COMPANY TWICE, ONCE AT THE TIME OF SURVEY AS WELL AS AT THE TIME OF ASSESSMENT PROCEEDINGS UNDER SECTION 153C/143(3)OF THE INCOME TAX ACT, 1961 BEFORE THE LEARNED ASSESSING OFFICER. ALSO THE ASSESSING OFFICER HIMSELF ACCEPTED THAT THE SAID C ASH BELONGS TO M/S SAS SERVIZIO PRIVATE LTD. IN HIS SATISFACTION R ECORDED FOR INITIATING ASSESSMENT PROCEEDINGS UNDER SECTION 153 C OF THE INCOME TAX ACT, 1961. IT IS ALSO EVIDENT THAT FROM THE FACTS AS ELABORATED BY THE ASSESSING OFFICER AND ALSO BY THE APPELLAN T, THERE IS NO DOUBT EITHER IN RESPECT OF ASSESSEE OR IN RESPECT O F ASSESSMENT YEAR ABOUT CASH OF RS.50,00,000/- FOUND IN POSSESSION OF THE APPELLANT. IN VIEW OF THE FACTS OF THE CASE, I AM OF THE OPINI ON THAT THE ADDITION OF RS.50,00,000/- IN THE HANDS OF THE APPELLANT ON PROTECTIVE BASIS IS BAD IN LAW AND IS HEREBY DELETED. 5. AGAINST THIS ORDER THE REVENUE IS IN APPEAL BEFO RE US. ITA NO.2836/DEL./2010 CO NO.254/DEL/2010 12 6. WE HAVE HEARD BOTH THE COUNSEL AND PERUSED THE R ECORDS. WE FIND THAT IT IS AN ADMITTED FACT THAT M/S SAS SERVIZIO LTD. HAS ACCEPTED THE FACT THAT THE CASH BELONG TO THE COMPANY. HENCE, ONCE W HEN THE AMOUNT HAS BEEN ASSESSED IN THE HANDS OF M/S SAS SERVIZIO LTD. , WE DO NOT FIND ANY INFIRMITY IN THE LD. COMMISSIONER OF INCOME TAX (AP PEALS)S FINDING THAT ADDITION IN THE HANDS OF THE ASSESSEE ON PROTECTIVE BASIS IS NOT REQUIRED. ACCORDINGLY, WE DO NOT FIND ANY INFIRMITY IN THE OR DER OF THE LD. COMMISSIONER OF INCOME TAX (APPEALS) AND HENCE, WE UPHOLD THE SAME. IN VIEW OF THESE FACTS, IT IS WELL ESTABLISHED THAT MONEY WAS BELONGING TO ASSESSEE ONLY. THEREFORE, NOW IT HAS TO BE SEEN WH ETHER THIS IS EXPLAINED MONEY IN THE HANDS OF THE ASSESSEE OR NOT. THE DOC UMENTS SEIZED DURING THE SURVEY OPERATION FROM THE PREMISES OF THE ASSESSEE WHICH ARE PLACED AT PAGES 83 TO 86 OF THE PAPER BOOK SHOW THAT THE CASH BALAN CE AS PER THE CASH BOOK OF ASSESSEE WAS RS.42,33,067.05 (EVIDENT FROM PAGE 85) . THE LEDGER ACCOUNT OF THE IMPREST ACCOUNT ALSO SHOWS ENTRY OF RS.30,00,00 0/- ON 08.08.2006 AND RS.10,00,000/- ON 07.09.2006. THE BOOKS OF ACCOUNT MAINTAINED IN THE COMPUTER EMANATED DURING THE COURSE OF SEARCH SUPPO RT THE CONTENTION OF THE ASSESSEE IN RESPECT OF THE TRANSACTIONS MADE THROUG H THE IMPREST ACCOUNT. THE ASSESSEE HAS ALSO EXPLAINED HOW THE IMPREST ACCOUNT IS MERGED WITH THE FINAL ACCOUNTS. THERE WAS A CASH WITHDRAWAL OF RS.30,00, 000/- JUST A MONTH BEFORE THE CASH FOUND. THE REVENUE HAS FAILED TO BRING AN YTHING ON RECORD WHICH COULD SHOW THAT MONEY WITHDRAWN FROM BANK WAS SPENT SOMEWHERE ELSE. THE PURPOSE FOR WHICH THE MONEY WAS CARRYING OUT TO GOA IS WELL EXPLAINED. THE PERSON ON WHOM THE MONEY WAS FOUND HAS STATED THE F ACT BEFORE THE SEARCH PARTY. THE PERSON FROM WHOM THE CASH WAS FOUND AND SEIZED WAS ALSO ITA NO.2836/DEL./2010 CO NO.254/DEL/2010 13 CARRYING A LETTER IN RESPECT OF WITHDRAWAL FROM TH E BANK WHICH SHOWS THAT THE AMOUNT WITHDRAWN FROM THE BANK WAS AVAILABLE WITH T HE ASSESSEE. THE ASSESSEE HAS FURNISHED A PLAUSIBLE EXPLANATION WHIC H THE REVENUE HAS FAILED TO DISPROVE. THE REVENUE HAS FAILED TO SHOW ANY INHER ENT WEAKNESS IN THE EXPLANATION OR REBUTTING BY PUTTING TO THE ASSESSEE SOME MORE EVIDENCE. THE REVENUE CANNOT REJECT A REASONABLE EXPLANATION AND CANNOT CONVERT A GOOD PROOF INTO A NO PROOF. THE ASSESSEES CONTENTION T HAT THE STATEMENTS RECORDED ON OATH DURING THE COURSE OF SURVEY U/S 133A OF THE ACT DO NOT HAVE ANY EVIDENCIARY VALUE AS THERE IS NO PROVISION WHICH EM POWERS THE ASSESSING OFFICER TO RECORD THE STATEMENT ON OATH DURING THE SURVEY OPERATION U/S 133A OF THE ACT. PARTIALLY, WE MAY AGREE WITH THE ASSES SEES CONTENTION. THERE IS A DIFFERENCE IN THE STATEMENT RECORDED U/S 132 (4) AN D 133A OF THE ACT. ADDITIONS MADE ONLY ON THE BASIS OF STATEMENTS RECO RDED DURING OPERATION U/S 133A MAY BE LIABLE TO BE QUASHED IN ABSENCE OF ANY CORROBORATIVE EVIDENCE. WHEN THERE IS NO EVIDENCE TO SUPPORT THE STATEMENT. HOWEVER, IN OUR CONSIDERED VIEW, A SMALL VARIATION IN THE STATEMENT RECORDED DURING THE SURVEY OPERATIONS AND STATEMENT RECORDED IN SEARCH OPERATI ONS AT OTHER PLACE CANNOT ALONE BE MADE BASIS FOR MAKING OR SUSTAINING THE AD DITIONS. IT IS ALSO NOT CORRECT THAT THERE WAS NO CLOSE AND PROXIMATE LINKA GE OF WITHDRAWAL OF CASH AND PAYMENT OF AMOUNT AS PER ALLOTMENT LETTER. THE ASSESSEE WAS IN CORRESPONDENCE WITH INFO TECH CORPORATION OF GOA LT D. IN RESPECT OF THE ITA NO.2836/DEL./2010 CO NO.254/DEL/2010 14 ALLOTMENT OF PLOT AT RAJIV GANDHI IT HABITAT DURING THE RELEVANT PERIOD. THE ASSESSEE RECEIVED A LETTER DATED 10.08.2006 IN THIS REGARD. THEREFORE, IN OUR CONSIDERED VIEW, THE ASSESSEE WAS VERY MUCH IN THE KNOWLEDGE REGARDING REQUIREMENT OF PAYMENT OF LAND AT GOA PRIOR TO WITH DRAWAL OF CASH AS ON 10.08.2006. THUS, CONSIDERING THE TOTALITY OF FACT S AND CIRCUMSTANCES OF THE CASE, WE FIND NO FAULT IN THE ORDER OF CIT (A) AND WE SUSTAIN THE SAME. CO NO.254/DEL/2010 10. IN THE ASSESSEES CROSS OBJECTION, THE ISSUE IN VOLVED IS ONLY AGAINST THE UPHOLDING OF THE VALIDITY OF THE ASSESSMENT PROCEED INGS U/S 153C READ WITH 153A OF THE INCOME-TAX ACT, 1961. 11. WE HAVE HEARD BOTH THE SIDES ON THE ISSUE. A S EARCH OPERATION U/S 132 OF THE ACT WAS CARRIED OUT ON 08.09.2006 ON SUNDEEP KALSI AT THE AIRPORT WHILE HE WAS TRAVELING FROM DELHI TO GOA WHO WAS AL SO ENGAGED AS CONSULTANT WITH THE ASSESSEE COMPANY. AT THE TIME OF SEARCH, SUNDEEP KALSI HAS STATED THAT THE CASH WAS BELONGING TO SAS SERVIZIO LTD. (T HE ASSESSEE) AND HIS STATEMENT RECORDED U/S 131 OF THE INCOME-TAX ACT, 1 961. A SURVEY OPERATION WAS ALSO CARRIED OUT AT THE PREMISES OF THE ASSESSE E. A SURVEY WAS A FOLLOW UP ACTION TO COVER THE PERSON TO WHOM THE CASH WAS STA TED TO HAVE BEEN BELONGING BY THE CARRIER SUNDEEP KALSI. THUS, THE PERSON FROM WHOM THE CASH WAS FOUND AND SEIZED STATED THAT THE CASH WAS BELONGING TO SAS SERVIZIO LTD. DURING THE SURVEY PROCEEDINGS AT THE PREMISES OF SAS SERVIZIO LTD., THE ITA NO.2836/DEL./2010 CO NO.254/DEL/2010 15 EMPLOYEES OF COMPANY HAD ALSO ADMITTED THAT THE CAS H WAS BELONGING TO THE ASSESSEE COMPANY. THUS, IT WAS CLEAR THAT THIS CAS H WAS BELONGING TO THE ASSESSEE. SINCE THE SEARCH WAS EXECUTED IN THE NAM E OF SUNDEEP KALSI AT THE AIRPORT, THEREFORE, ASSESSMENT PROCEEDINGS WERE TO BE INITIATED U/S 153A IN THE CASE OF SHRI KALSI AND PROCEEDINGS U/S 153C IN ASSE SSEES CASE. THERE WAS NO DOUBT ABOUT THE FACT THAT THE SEIZED MONEY WAS BELO NGING TO THE ASSESSEE ONLY. THE PROCEEDINGS U/S 153C R.W.S. 153A HAS TO BE TAKE N IN THE CASE OF ASSESSEE ONLY. THE CIT (A) HAS NOT GIVEN DECISION ON MERITS ON THIS GROUND. HE HAS SIMPLY STATED THAT SINCE THE ASSESSEE GETS THE RELI EF ON OTHER GROUNDS, HENCE IT DOES NOT REQUIRE ANY COMMENTS. AS WE HAVE ALREADY SUSTAINED THE ORDER OF THE CIT (A) ON THE GROUNDS ON WHICH THE RELIEF TO T HE ASSESSEE WAS GRANTED. IN VIEW OF THEE FACTS, WE FIND NO NECESSITY TO ADJU DICATE THIS GROUND. 12. IN THE RESULT, THE APPEAL OF THE REVENUE IS DIS MISS AND THE CROSS OBJECTION FILED BY THE ASSESSEE ALSO STANDS DISMISS ED. ORDER PRONOUNCED IN OPEN COURT ON THIS 25 TH DAY OF MAY, 2012. SD/- SD/- (U.B.S. BEDI) (B.C. MEENA) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED THE 25 TH DAY OF MAY, 2012.TS COPY FORWARDED TO: 1.APPELLANT 2.RESPONDENT 3.CIT 4.CIT (A)-I, NEW DELHI. 5.CIT(ITAT), NEW DELHI. AR, ITAT NEW DELHI.