Shri Shri Prakash Bagla, Kolkata V. D.C.I.T CC - VII,kolkata, Kolkata

ITA 1223/KOL/2013

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 1785 (ITAT-KOLKATA)
• Duration Of Justice: 3 year(s) 11 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-05-2017
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 02-02-2017
• Assessment Year: 2009-2010
• Appeal Filed On: 13-05-2013
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: T VARKEY JUDIC IA L M EMBER
• Assessee Lawyers: S JHAJHARIA; SUJOY SEN ADVOCAT
• Keywords: Unexplained investment; Document seized; Peak credit; Validity of assessment; Documents seized; Reassessment proceedings
• Section: 143(3); 133A; 153A; 132; 15

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA BENCH B KOLKATA BEFORE SHRI ABY.T VARKEY, JUDICIAL MEMBER AND SHRI WASEEM AHMED, ACCOUNTANT MEMBER ITA NO. 1203 &1223 / KOL / 2013 ASSESSMENT YEAR :2009-10 DCIT, CENTRAL CIRCLE-VII, AAYAKAR BHAWAN, POORVA, 110, SHANTIPALLY, KOLKATA-107 SHRI PRAKASH BAGLA CD-315, SECTOR-I, SALT LAKE CITY, KOLKATA-64 [ PAN NO.ADUPB 6558 R ] V/S . V/S . SHREE PRAKASH BAGLA CD-315, SECTOR-I, SALT LAKE CITY, KOLKATA-64 DCIT, CC-VII, AAYAKAR BHAWAN POORVA, 110, SHANTIPALLY, KOLKATA- 107 /APPELLANT .. / RESPONDENT C.O. NO.94/KOL/2013 (A/O ITA NO.1203/KOL/2013) ASSESSMENT YEAR: 2009-10 SHRI PRAKASH BAGLA CD-315, SECTOR-I, SALT LAKE CITY, KOLKATA-64 V/S . DCIT, CC-VII, AAYAKAR BHAWAN POORVA, 110, SHANTIPALLY, KOLKATA-107 / RESPONDENT/CO- OBJECTOR .. /APPELLANT /BY ASSESSEE SHRI S. JHAJHARIA, FCA & SHRI SUJOY SEN, ADVOCATE /BY REVENUE SHRI NIRAJ KUMAR, CIT-DR /DATE OF HEARING 06-02-2017 ! /DATE OF PRONOUNCEMENT 03-05-2017 ITA NO.1203,1223/KOL/2013 & CO.94/KOL/2013 DCIT CC-VII, KOL. VS. SH PRAKASH BAGL A P AGE 2 / O R D E R PER WASEEM AHMED, ACCOUNTANT MEMBER:- THE CROSS-APPEALS FOR THE ASSESSMENT YEAR 2009-10 H AVE BEEN FILED BY THE REVENUE AS WELL AS BY THE ASSESSEE AGAINST THE COMMON ORDER OF COMMISSIONER OF INCOME TAX (APPEALS)-I DATED 28.02. 2013 AND THE CROSS OBJECTION (CO) HAS BEEN FILED BY THE ASSESSEE IN RE VENUES APPEAL NO.1203/KOL/2013. SHRI S.JHAJHARIA AND SUJOY SEN, LD. AUTHORIZED REPR ESENTATIVE APPEARED ON BEHALF OF ASSESSEE AND SHRI NIRAJA KUMAR, LD. DEPAR TMENTAL REPRESENTATIVE REPRESENTED ON BEHALF OF REVENUE. 2. ALL THESE ARE HEARD TOGETHER AND ARE BEING DISPO SED OF BY WAY OF COMMON ORDER FOR THE SAKE OF CONVENIENCE. FIRST WE TAKE UP ASSESSEES APPEAL IN ITA NO.1223/K OL/2013 . 3. THE ASSESSEE IN GROUND NO. 1 TO 3 IS INTER-RELAT ED AND THEREFORE BEING TAKEN UP TOGETHER HAS CHALLENGED THE VALIDITY OF TH E PROCEEDINGS IN ITIATED & COMPLETED U/S 153A/143(3) OF THE INCOME TAX ACT, 19 61 (HEREINAFTER REFERRED TO AS THE ACT). FOR THIS, THE ASSESSEE HAS RAISED THE F OLLOWING GROUNDS OF APPEAL:- 1. FOR THAT IN VIEW OF THE FACTS AND IN THE CIRCUM STANCES THE LD. CIT(A) WAS WHOLLY UNJUSTIFIED IN CONFIRMING THE LEGALITY OF OR DER PASSED BY THE AO U/S 153A/143(3) AND IN VIEW OF THE FACTS AND IN THE CIR CUMSTANCES THE ACTION OF THE LD CIT(A) IN SUCH RESPECT IS WHOLLY BAD & ILLEG AL AND SUCH ORDER IS LIABLE TO BE QUASHED / CANCELLED / SET ASIDE AND IT MAY KINDL Y BE HELD ACCORDINGLY. 2. WITHOUT PREJUDICE TO GROUND NO.1 ABOVE AND IN VI EW OF THE FACTS AND IN CIRCUMSTANCES, THE LD. CIT(A) FAILED TO APPRECIATE THE FACT THAT NO VALID SEARCH HAVING TAKEN PLACE IN RESPECT OF THE APPELLANT, THE PROCEEDINGS SO INITIATED BY THE AO U/S. 153A IS VOID ABINITIO AND THE LD. CIT( A) WITHOUT APPRECIATING THE FACT DISMISSED THE APPELLANTS GROUND IN SUCH RESPE CT AND IN VIEW OF THE FACTS AND IN THE CIRCUMSTANCES THE ORDERED SO PASSED U/S. 153A MAY KINDLY BE QUASHED / CANCELLED / SET ASIDE. 3. FOR THAT IN VIEW OF THE FACTS AND IN THE CIRCUMS TANCES AND WITHOUT PREJUDICE TO GROUNDS NO.1 & 2 ABOVE, THE ENTIRE ASST AND ALL THE ADDITIONS IN THE HANDS OF YOUR APPELLANT HAVING BEEN MADE BY THE AO ON THE BASIS OF PAPERS AND DOCUMENTS IMPOUNDED DURING SURVEY CARRIED OUT ON AT THE OFFICE OF MAGNA DEALERS (P) LTD. ON 25.02.2009 SUCH SURVEY NOT BEIN G ON SHREE PRAKASH ITA NO.1203,1223/KOL/2013 & CO.94/KOL/2013 DCIT CC-VII, KOL. VS. SH PRAKASH BAGL A P AGE 3 BAGLA AND YOUR APPELLANT AND SUCH PAPERS HAVING BEE N FOUND AND IMPOUNDED FROM THE POSSESSION / CUSTODY OF MAGNA DEALERS (P) LTD. AND NOT YOUR APPELLANT ANY SUCH ASST. AND ADDITION MADE U/S 153A / 143(3) IN THE HANDS OF YOUR APPELLANT WITHOUT EXAMINING THE PERSONS SURVEY ED AND BRINGING ANY EVIDENCE ON RECORD IS WHOLLY BAD, ILLEGAL AND VALID ABINITIO AND IS LIABLE TO BE QUASHED / CANCELLED AND IN VIEW OF THE FACTS AND IN THE CIRCUMSTANCES IT MAY KINDLY BE HELD ACCORDINGLY. 4. AT THE OUTSET, IT WAS OBSERVED THAT THE LD AR IN ITS APPEAL HAS CHALLENGED THE REASSESSMENT PROCEEDINGS INITIATED AND COMPLETED U/ S 153A OF THE ACT. ACCORDINGLY, THE LD AR MADE HIS ARGUMENTS AT LENGTH AT THE TIME OF HEARING BUT AT THE CONCLUSION OF THE HEARING ON THIS ISSUE THE LD AR AGREED TO TH E ORDER OF LD CIT(A) AND DID NOT CHALLENGE THE VALIDITY OF ASSESSMENT FRAMED U/S 153 A OF THE ACT. ON THE OTHER HAND, THE LD DR RELIED ON THE ORDER OF AUTHORITIES BELOW. 5. IN VIEW OF ABOVE FACTUAL POSITION, WE FIND NO ME RIT IN THE ARGUMENT OF THE LD AR. HENCE, THE ISSUE IN THE AFORESAID GROUNDS OF AP PEAL IS HEREBY DISMISSED. 6. LAST ISSUE IN THIS APPEAL OF ASSESSEE IS GENERAL IN NATURE AND DOES NOT REQUIRE ANY ADJUDICATION. 7. IN THE RESULT, ASSESSEES APPEAL IS DISMISSED. COMING TO REVENUES APPEAL IN ITA NO.1203/KOL/2013 . 8. THE ISSUE RAISED BY THE REVENUE IN GROUND NO. 1 IS THAT LD CIT(A) ERRED IN REDUCING THE GROSS PROFIT DETERMINED BY THE AO A T THE RATE OF 4% TO 1.5% OF THE GROSS TURNOVER. 9. A SEARCH & SEIZURE OPERATION U/S 132 OF THE ACT WAS CONDUCTED ON SALTEE GROUP INCLUDING THE ASSESSEE DATED 25.02.2009 AND O N SUBSEQUENT DATES BY THE INVESTIGATION UNIT OF INCOME TAX DEPARTMENT. THE AS SESSEE IS ONE OF THE DIRECTORS IN THE GROUP. AS A RESULT OF SEARCH, IT WAS DISCOVERED THAT THE ASSESSEE IS ENGAGED IN THE TRADING BUSINESS OF THE SOAPS, DAMARBATA FURNIT URE, WAX OIL WHICH WAS NOT DISCLOSED TO THE INCOME TAX DEPARTMENT. THE UNDISCL OSED TURNOVER FROM THE SAID BUSINESS WAS ASCERTAINED AT RS.8,14,26,433/- PERTAI NING TO THE YEAR UNDER CONSIDERATION ON THE BASIS OF SEIZED DOCUMENTS MARK ED SPB/19 & 21. THE ASSESSEE ITA NO.1203,1223/KOL/2013 & CO.94/KOL/2013 DCIT CC-VII, KOL. VS. SH PRAKASH BAGL A P AGE 4 OFFERED INCOME ON THE UNDISCLOSED TURNOVER @ 1% BUT THE AO REJECTED THE SAME AND ESTIMATED @ 4% OF THE TURNOVER. THE AO ACCORDINGLY DETERMINED THE PROFIT AT RS.32,57,057.00 AND ADDED TO THE TOTAL INCOME OF TH E ASSESSEE. 10. AGGRIEVED, ASSESSEE PREFERRED AN APPEAL TO THE LD. CIT(A). THE ASSESSEE SUBMITTED BEFORE THE LD. CIT(A) THAT THE AO HAS ADO PTED THE RATE OF GROSS PROFIT ARBITRARY AND WITHOUT ANY BASE. THE ASSESSEE IN SUP PORT OF HIS CLAIM HAS SUBMITTED THAT MAGNA DEALERS PRIVATE LIMITED (MDPL FOR SHORT) IS ALSO ENGAGED IN SIMILAR BUSINESS OF TRADING ITEMS. THE MDPL HAS SHOWN ITS G ROSS PROFIT IN THE LAST 4 YEARS AS DETAILED UNDER : S.NO. AYS GP RATE 1. 2006-07 1.09% 2. 2007-08 1.43% 3. 2008-09 0.26% 4. 2009-10 0.36% THE ABOVE GROSS PROFIT RATE DECLARED BY THE MDPL WA S DULY ACCEPTED BY THE REVENUE IN THE ASSESSMENT OF MDPL. THE LD CIT(A) AF TER CONSIDERING THE SUBMISSION OF THE ASSESSEE HAS REDUCED THE GROSS PR OFIT FROM 4% TO 1.5% OF THE UNDISCLOSED TURNOVER BY OBSERVING AS UNDER:- 8. I HAVE PERUSED THE ASSESSMENT ORDER AND CONSIDE RED THE SUBMISSIONS OF THE APPELLANT AS WELL AS THE MATERIAL ON RECORD. TH E UNDISCLOSED SALES FOR THE ASSESSMENT YEARS 2007-08 TO 2009-10 AS DETERMINED B Y THE AO IN HIS ASSESSMENT ORDERS ON THE BASIS OF THE IMPOUNDED MAT ERIAL HAS NOT BEEN CONTESTED BY THE APPELLANT. THE ONLY DISPUTE RELATE S TO THE APPLICATION OF GROSS PROFIT RATE ON SUCH UNDISCLOSED SALES. I FIND THAT THE APPELLANT HAD IN HIS DISCLOSURE PETITION SUBMITTED BEFORE THE DDIT(INV) SURRENDERED UNDISCLOSED PROFIT BY APPLYING THE GROSS PROFIT RATE OF 1%. I F IND MERIT IN THE ARGUMENT THAT THE AO HAS BROUGHT NO MATERIAL ON RECORD TO SUGGEST THAT THE GROSS PROFIT RATE OF 1% WAS LOW AS OBSERVED BY HIM IN HIS ASSESSMENT ORDERS. I FIND FROM THE ASSESSMENT ORDERS THAT THERE IS NO MATERIAL ON RECO RD WHICH EVEN REMOTELY SUGGESTS THAT THE APPELLANT HAD UTILIZED THE BUSINE SS ESTABLISHMENT OF ABHISHEK ENTERPRISES OR SONGAL ENGINEERS FOR ITS UN ACCOUNTED BUSINESS. THE AO HAS NOT EXPLAINED IN HIS ASSESSMENT ORDERS AS TO HOW HE ARRIVED AT THE CONCLUSION THAT THE BUSINESS ESTABLISHMENT OF ABHIS HEK ENTERPRISES OR SONGAL ENGINEERS WAS UTILIZED BY THE APPELLANT FOR ITS UNA CCOUNTED BUSINESS. THE AO HAS ALSO NOT EXPLAINED THE BASIS FOR APPLYING THE G ROSS PROFIT RATE OF 4% IN THE CASE OF THE APPELLANT. IN VIEW OF THE ABOVE, I AM O F THE OPINION THAT THE ACTION OF THE AO IN APPLYING THE GROSS PROFIT RATE OF 4% I S ARBITRARY AND WITHOUT ANY BASIS AS IT IS NOT SUPPORTED BY ANY MATERIAL OR EVI DENCE ON RECORD. IT WAS SUBMITTED BEFORE ME THAT MAGNA DEALERS (P) LTD WAS ALSO ENGAGED IN SIMILAR BUSINESS WHOSE TRADING RESULTS WERE ACCEPTED BY ITS AO IN THE ASSESSMENT ITA NO.1203,1223/KOL/2013 & CO.94/KOL/2013 DCIT CC-VII, KOL. VS. SH PRAKASH BAGL A P AGE 5 ORDER ASSED U/S 143(3) FOR THE ASSESSMENT YEAR 2009 -10. THE COMPANY HAS DECLARED GROSS PROFIT RATE OF 1.09%, 1.43%, 0.26% A ND 0.36% IN THE ASSESSMENT YEARS 2006-07 TO 2009-10. IN THIS FACTUA L BACKGROUND, I AM OF THE OPINION THAT IT WOULD BE APPROPRIATE TO APPLY THE G ROSS PROFIT RATE OF 1.5% IN THE CASE OF THE APPELLANT. IN CONSEQUENCE, THE UNAC COUNTED PROFIT ON THE UNDISCLOSED SALES SHOULD WORK OUT AS UNDER:- ASSESSMENT YEAR UNDISCLOSED PROFIT (RS) 2007-08 2,79,857 2008-09 11,51,038 2009-10 12,21,396 IN VIEW OF THE ABOVE, THE ADDITION ON ACCOUNT OF P ROFIT ON UNDISCLOSED SALES AS MADE BY THE AO IN THE ASSESSMENT YEARS 2007-08, 200 8-09 AND 209-10 IS RESTRICTED TO RS.2,79,857/-, 11,51,038/- AND 12,21, 396/- RESPECTIVELY. BEING AGGRIEVED BY THE ORDER OF LD CIT(A) THE REVEN UE IS IN APPEAL BEFORE US ON THE FOLLOWING GROUND OF APPEAL :- 1. THE LD. CIT(A), CENTRAL-I, KOLKATA HAS ERRED IN DELETING THE GROSS PROFIT OF RS.20,35,661/- FROM RS.32,57,057/- AT THE RATE FROM 4% TO 1.5% STATING THE AO WAS UNJUSTIFIED AND EXCESSIVE ADDITION WAS MADE. 11. THE LD. DR BEFORE US RELIED ON THE ORDER OF AO AND HE LEFT THE ISSUE TO THE DISCRETION OF THE BENCH. ON THE OTHER HAND, THE LD AR BEFORE US FILED A PAPE R BOOK WHICH IS RUNNING FROM PAGES 1 TO 184 AND REITERATED THE ARGUMENTS THAT WE RE MADE BEFORE THE LD. CIT(A). 12. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE MATERIALS AVAILABLE ON RECORD. THE ISSUE IN THE PRESENT GROUND OF APPEAL I S ARISING AS ALLEGED BY THE REVENUE THAT THE LD. CIT(A) HAS REDUCED THE GP RATE . IN THIS REGARD IT WAS FOUND THAT THE ADDITION WAS MADE BY ESTIMATING THE GROSS PROFI T @ 4% ON THE UNDISCLOSED TURNOVER. ADMITTEDLY, THE ASSESSEE WAS ENGAGED IN T HE TRADING BUSINESS WHICH WAS NOT DISCLOSED TO THE REVENUE. NOW, THE ISSUE ARISES FOR ADJUDICATION TO WORK OUT THE INCOME EARNED BY THE ASSESSEE FROM HIS UNDISCLOSED BUSINESS. THE ASSESSEE HAS OFFERED GROSS PROFIT ON SUCH UNDISCLOSED BUSINESS @ 1% WHEREAS THE AO HAS TAKEN GROSS PROFIT @ OF 4%. HOWEVER, ON PERUSAL OF ASSESS MENT ORDER, WE FIND THAT THE ESTIMATED RATE @ OF 4% TOWARDS THE GROSS PROFIT WAS ADOPTED BY THE AO WITHOUT ADDUCING ANY REASON. ON THE CONTRARY, THE LD. CIT(A ) HAS REDUCED THE RATE OF GROSS PROFIT FROM OF 4% TO 1.5% BY HAVING RELIANCE IN THE ASSESSMENT ORDER IN THE CASE OF MDPL, ENGAGED IN THE SIMILAR BUSINESS, WHERE THE GR OSS PROFIT WAS SHOWN @ LESS ITA NO.1203,1223/KOL/2013 & CO.94/KOL/2013 DCIT CC-VII, KOL. VS. SH PRAKASH BAGL A P AGE 6 THAN 1.5% AND THE SAME WAS ACCEPTED BY THE REVENUE. AT THE OUTSET, WE FIND THAT THE AO HAS ADOPTED THE RATE OF GROSS PROFIT WITHOUT ANY BASIS. ON THE CONTRARY, THE LD CIT(A) HAS ADOPTED THE SCIENTIFIC APPROACH FOR DETE RMINING THE GROSS PROFIT ON THE UNDISCLOSED INCOME. AS SUCH, WE FIND NO INFIRMITY I N THE ORDER OF LD CIT(A) AND WE UPHOLD THE SAME. HENCE, THIS GROUND OF APPEAL OF TH E REVENUE IS DISMISSED. 13. NEXT ISSUE RAISED BY THE REVENUE IS THAT LD CIT (A) ERRED IN DELETING THE ADDITION MADE BY THE AO FOR RS. 34 LACS ON ACCOUNT OF INVESTMENT MADE IN THE LAND. 14. THE AO ON THE BASIS OF SEIZED DOCUMENTS MARKED AS PAGE 38,40,43 & 44 OF SPB/19 FOUND THAT THE ASSESSEE HAS MADE PAYMENTS TO SHRI SANDEEP HARLALKA IN CASH AS DETAILED UNDER:- 23.04.08 RS. 5,00,000 [PAGE 44 SPB/19] 25.04.08 RS. 5,00,000 [PAGE 44 SPB/19] 26.04.08 RS. 2,00,000 [PAGE 43 SPB/19] 28.04.08 RS. 3,00,000 [PAGE 43 SPB/19] 10.05.08 RS.15,00,000 [PAGE 40 SPB/19] 20.05.08 RS 5,00,000 [PAGE 38 SPB/19] TOTAL RS.35,00,000 THE ABOVE PAYMENT WAS NOT RECORDED IN THE BOOKS OF ACCOUNTS OF THE ASSESSEE. THEREFORE, THE SAME WAS TREATED AS UNDISCLOSED INVE STMENT IN LAND AND ADDED TO THE TOTAL INCOME OF THE ASSESSEE. 15. AGGRIEVED, ASSESSEE PREFERRED AN APPEAL TO THE LD. CIT(A). THE ASSESSEE BEFORE THE LD. CIT(A) SUBMITTED THAT THE ADDITIONS HAS ALREADY BEEN MADE BY THE AO ON THE BASIS OF SEIZED DOCUMENTS. THESE ADDITIONS W ERE MADE IN THE FORM OF GROSS PROFIT ON THE UNDISCLOSED BUSINESS AS WELL AS UNDIS CLOSED INVESTMENT IN SUCH BUSINESS. ON THE SIMILAR SET OF DOCUMENTS OF NO SEP ARATE ADDITION CAN BE MADE ON ACCOUNT OF INVESTMENT IN THE LAND. IT WAS ALSO SUBM ITTED THAT THE AO IN THE REMAND REPORT HAS ADMITTED THAT PAYMENT RECORDED IN THE IM POUNDED DOCUMENTS REPRESENT PERSONAL EXPENSES AS WELL AS UNACCOUNTED INVESTMENT . THE LD CIT(A) AFTER ITA NO.1203,1223/KOL/2013 & CO.94/KOL/2013 DCIT CC-VII, KOL. VS. SH PRAKASH BAGL A P AGE 7 CONSIDERING THE SUBMISSION OF THE ASSESSEE HAS DELE TED THE ADDITION MADE BY THE AO BY OBSERVING AS UNDER:- THE AO HAS ADMITTED IN HIS REMAND REPORT THAT THE ROTATION STATEMENT FILED BY THE APPELLANT IN COURSE OF THE APPELLATE PROCEEDING S INCORPORATES ALL THE DEBIT AND CREDIT ENTRIES RECORDED IN THE SEIZED DOCUMENTS SPB/19, SPB/20, SPB/21 AND SPB/23. THE AO HAS ALSO ADMITTED THAT THE CASH PAYMENTS RECORD IN THE IMPOUNDED DOCUMENTS REPRESENT PERSONAL EXPENSES AS WELL AS UNACCOUNTED INVESTMENT. I FIND FROM THE ASSESSMENT ORDER THAT T HE AO HAS CONSIDERED ALL THE RECEIPTS AS APPEARING IN THE IMPOUNDED DOCUMENT S SPB/19, SPB/20, SPB/21 AND SPB/23 WHILE COMPUTING THE UNDISCLOSED S ALES FOR THE ASSESSMENT YEARS 2007-08, 2008-09 AND 2009-10. THE AO HAS ALSO STATED IN THE ASSESSMENT ORDER THAT THE CASH PAYMENTS TOTALIN G TO RS.34,00,000/- ARE RECORDED IN THE IMPOUNDED DOCUMENT SPB/19. I FIND M ERIT IN THE ARGUMENT THAT WHEN THE AO HAS CONSIDERED ALL THE RECEIPTS RE CORDED IN THE IMPOUNDED DOCUMENT SPB/19 WHILE COMPUTING THE UNDISCLOSED SAL ES, THEN NO SEPARATE ADDITION CAN BE MADE ON ACCOUNT OF PAYMENTS RECORD ED IN SUCH IMPOUNDED DOCUMENTS AS THEY HAVE COME OUT OF THE RECEIPTS ALR EADY CONSIDERED BY THE AO. I HAVE ALREADY CONFIRMED THE UNDISCLOSED SALES OF RS.1,86,57,135/-, RS.7,67,35,863/- AND RS.8,14,26,433/- IN THE ASSESS MENT YEARS 2007-08, 2008-09, AND 2009-10 AS COMPUTED BY THE AO IN HIS A SSESSMENT ORDERS. I HAVE ALSO UPHELD THE ORDER OF THE AO IN ASSESSING T HE GROSS PROFIT ON SUCH UNDISCLOSED SALES AS WELL AS ADDITION ON ACCOUNT OF UNDISCLOSED INVESTMENT. UNDER THE CIRCUMSTANCES, THE CASH PAYMENTS AS RECOR DED IN THE IMPOUNDED DOCUMENT SPB/19 HAS TO BE TREATED AS MADE OUT OF TH E RECEIPTS RECORDED IN SPB/19 WHICH HAVE ALREADY BEEN CONSIDERED BY THE AO . IN OTHER WORDS, THE CASH PAYMENTS AS RECORDED IN THE IMPOUNDED DOCUMENT SPB/19 HAS TO BE TREATED AS EXPLAINED IN VIEW OF THE RECEIPTS RECORD ED IN SPB/19 WHICH HAVE ALREADY BEEN CONSIDERED BY THE AO. I AGREE WITH THE APPELLANT THAT NO SEPARATE ADDITION CAN BE MADE ON ACCOUNT OF PAYMENT S RECORDED IN THE IMPOUNDED DOCUMENTS AS THEY HAVE COME OUT OF THE RE CEIPTS RECORDED IN SUCH DOCUMENTS WHICH HAVE ALREADY BEEN CONSIDERED B Y THE AO FOR THE PURPOSES OF TAXATION. IN VIEW OF THE ABOVE, THE ADD ITION OF RS.35,00,000/- I THE ASSESSMENT YEAR 2009-10 AS MADE BY THE AO IN THE AS SESSMENT ORDER IS DIRECTED TO BE DELETED. BEING AGGRIEVED BY THE ORDER OF LD CIT(A) THE REVEN UE IS IN APPEAL BEFORE US ON THE FOLLOWING GROUND OF APPEAL :- 2. THE LD. CIT(A) ERRED IN DELETING THE ADDITION M ADE A THE TIME OF ASSESSMENT AS UNDISCLOSED INVESTMENT IN LAND (S. HA RALALKA RS.35 LAKHS) STATING THAT THE INVESTMENT IS COVERED IN THE UNDIS CLOSED TURNOVER. 16. BEFORE US BOTH PARTIES RELIED ON THE ORDER OF A UTHORITIES BELOW AS FAVORABLE TO THEM. ITA NO.1203,1223/KOL/2013 & CO.94/KOL/2013 DCIT CC-VII, KOL. VS. SH PRAKASH BAGL A P AGE 8 17. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE MATERIALS AVAILABLE ON RECORD. THE ISSUE IN THE PRESENT APPEAL RELATES TO THE UNDISCLOSED INVESTMENTS MADE BY THE ASSESSEE TO THE TUNE OF RS. 34 LACS. WE NOTE THAT THE LD. CIT-A HAS CONFIRMED THE UNDISCLOSED SALES OF RS.1,86,57,135/-, RS.7,67, 35,863/- AND RS.8,14,26,433/- IN THE ASSESSMENT YEARS 2007-08, 2008-09, AND 2009-10 WHICH WAS WORKED OUT BY THE AO IN HIS ASSESSMENT ORDERS PASSED UNDER SECTION 15 3A OF THE ACT RESPECTIVELY. WE ALSO OBSERVED THAT THE LD. CIT-A HAVE ALSO UPHELD T HE ORDER OF THE AO IN ASSESSING THE GROSS PROFIT ON SUCH UNDISCLOSED SALES AS WELL AS ADDITION ON ACCOUNT OF UNDISCLOSED INVESTMENT. THUS THE LD. CIT-A WAS OF T HE OPINION THAT THE CASH PAYMENTS AS RECORDED IN THE IMPOUNDED DOCUMENT SPB/ 19 HAS TO BE TREATED AS MADE OUT OF THE RECEIPTS RECORDED IN SPB/19 WHICH H AVE ALREADY BEEN CONSIDERED BY THE AO. IN OTHER WORDS, ACCORDING TO THE LD. CIT-A THE CASH PAYMENTS AS RECORDED IN THE IMPOUNDED DOCUMENT SPB/19 HAS TO BE TREATED AS EXPLAINED IN VIEW OF THE RECEIPTS RECORDED IN SPB/19 WHICH HAVE ALREADY BEEN CONSIDERED BY THE AO. THE AFORESAID FACTUAL FINDING WAS NOT CONTROVERTED BY T HE LD. DR. THEREFORE WE FULLY AGREE WITH THE REASONS GIVEN BY THE LD. CIT-A AND FOR THE SAME WE RELY IN THE JUDGMENT OF HONBLE SUPREME COURT OF INDIA IN THE CASE OF CIT VS. K.Y. PILLIAH & SONS REPORTED IN 63 ITR 411 WHEREIN IT WAS HELD AS UNDER:- THE TRIBUNAL IS THE FINAL FACT-FINDING AUTHORITY A ND NORMALLY IT SHOULD RECORD ITS CONCLUSION ON EVERY DISPUTED QUESTION RA ISED BEFORE IT, SETTING OUT ITS REASONS IN SUPPORT OF ITS CONCLUSIO N. BUT, IN FAILING TO RECORD REASONS, WHEN THE TRIBUNAL FULLY AGREES WITH THE VIEW EXPRESSED BY AAC AND HAS NO OTHER GROUND TO RECORD IN SUPPORT OF ITS CONCLUSION, IT DOES NOT ACT ILLEGALLY OR IRREGULARLY, MERELY BE CAUSE IT DOES NOT REPEAT THE GROUNDS OF THE AAC ON WHICH THE DECISION WAS GI VEN AGAINST THE ASSESSEE OR THE DEPARTMENT. THEREFORE WE CONCUR WITH THE VIEW OF LD. CIT(A) AN D HENCE THIS GROUND OF APPEAL OF THE REVENUE IS DISMISSED. 18. IN THE RESULT, REVENUES APPEAL IS DISMISSED. COMING TO ASSESSEES CO NO.94/KOL/2013 . 19. FIRST ISSUE RAISED IN GROUND NO. 1 IS THAT THE VALIDITY OF THE PROCEEDINGS INITIATED & COMPLETED U/S 153A/143(3) OF THE ACT. F OR THIS, THE ASSESSEE HAS RAISED THE FOLLOWING GROUND:- 1. FOR THAT IN VIEW OF THE FACTS AND CIRCUMSTANCES OF THE CASE THE LD. CIT(A) WAS WHOLLY WRONG AND UNJUSTIFIED IN CONFIRMING THE INIT IATION OF THE PROCEEDING U/S. ITA NO.1203,1223/KOL/2013 & CO.94/KOL/2013 DCIT CC-VII, KOL. VS. SH PRAKASH BAGL A P AGE 9 153A OF THE ACT AND THE CONSEQUENTIAL ORDER PASSED BY THE AO U/S 153A/143(3) INSPITE OF THE FACT THAT THERE WAS NO SPECIFIC SEAR CH WARRANT AGAINST THE APPELLANT ASSESSEE AND AS SUCH THEE WAS NO VALID SEARCH AND F URTHER THAT THE SURVEY OPERATION U/S. 133A OF THE ACT WAS CONDUCTED AT THE PREMISES OF A THIRD PARTY. THE PROCEEDING U/S 153A AS WELL AS THE ORDER U/S 15 3A/143(3) OF THE ACT ARE LIABLE TO BE QUASHED / CANCELLED. 20. WE HAVE ALREADY ADJUDICATED THE SAME ISSUE IN A SSESSEES APPEAL IN ITA NO.1223/KOL/2013 EMBODIED IN PARA 3 TO 4 OF THIS OR DER. WE HOLD ACCORDINGLY. HENCE, THIS GROUND OF ASSESSEES CO IS DISMISSED. 21. NEXT GROUND NO. 2 & 3 HAS CHALLENGED THE ADDITI ON OF THE GROSS PROFIT DETERMINED ON THE UNDISCLOSED TURNOVER. 22. AT THE OUTSET, IT WAS OBSERVED THAT THE LD AR H AS NOT ADVANCED ANY ARGUMENT ON THE ABOVE STATED ISSUE AT THE TIME OF HEARING. T HEREFORE, BOTH THE GROUNDS OF THE ASSESSEE BECOME INFRUCTUOUS AND ACCORDINGLY DISMISS ED AS INFRUCTUOUS. 23. LAST GROUND NO. 4 HAS CHALLENGED THE ACTION OF THE LD. CIT(A) FOR NOT EXCLUDING THE ADDITION MADE BY THE AO FOR THE AY 2008-09 FOR RS.2,56,727/- WHILE DETERMINING THE PEAK CREDIT FOR THE YEAR UNDER CONSIDERATION. 24. AT THE OUTSET, IT WAS OBSERVED THAT THE INSTANT ISSUE RAISED BY THE ASSESSEE IS NOT ARISING OUT OF THE ORDER OF AO. THEREFORE, THE SAME IS DISMISSED AS INFRUCTUOUS. 25. IN THE RESULT, ASSESSEES CO IS DISMISSED. 26. WE SUMMARIZE THE RESULT AS UNDER:- (1) REVENUES APPEAL IS DISMISSED; (2) ASSESSEES APPEAL AND THAT OF CO ARE DISMISSED . ORDER PRONOUNCED IN THE OPEN COURT 03/ 05/2017 SD/- SD/- (ABY. T. VARKEY) (WASEEM AHMED) (JUDICIAL MEMBER) (ACCOUNTANT MEMBER) KOLKATA, *DKP '#$- 03 / 05 /201 7 ITA NO.1203,1223/KOL/2013 & CO.94/KOL/2013 DCIT CC-VII, KOL. VS. SH PRAKASH BAGL A P AGE 10 / COPY OF ORDER FORWARDED TO:- 1. /ASSESSEE-SHRI PRAKASH BAGLA, CD-315, SECTOR-I, SAL T LAKE CITY, KOLKATA-64 2. /REVENUE-DCIT,CEN.CIR.VII/ AYAKAR BHAWAN, POORVA, 1 10, SHANTIPALLY, KOLKATA-107 3. #,#-. / / CONCERNED CIT KOLKATA 4. /- / CIT (A) KOLKATA 5. 234 55-., -.!, / DR, ITAT, KOLKATA 6. 489 :; / GUARD FILE. BY ORDER/ , /TRUE COPY/ / # -.!,