MOHAMMED A MODI, MUMBAI V. DCIT CEN CIR 42, MUMBAI

ITA 1307/MUM/2010

• Counselvise Citation: 130719914 RSA 2010
• Duration Of Justice: 3 year(s) 10 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-01-2014
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: J
• Next Hearing Date: 30-12-2013
• Assessment Year: 2007-2008
• Appeal Filed On: 17-02-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S D SRIVASTAVA
• Assessee Lawyers: S DIVATIA
• Keywords: Unexplained cash credit; Rejection of books of accounts; Unexplained investment; Gift; Loose papers; Document seized; Documents seized
• Section: 143(3); 153A; 32; 131; 68; 132; 12

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCH J , MUMBAI BEFORE SHRI P.M. JAGTAP , ACCOUNTANT MEMBER AND SHRI SANJAY GARG , JUDICIAL MEMBER ITA NO. 1307/M/2010 ASSESSMENT YEAR: 2007 - 08 SHREE MOHAMM E D A. MODI , 57, GUJJAR STREET, 1 ST FLOOR, CHASWALA BUILDING , NULL BAZAR, MUMBAI 400 003 PAN: AHQPM6131M VS. DY. COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE 42, 6 TH FLOOR, R. NO.659, AAYAKAR BHAVAN, M.K. ROAD, MUMBAI . (APPELLANT) (RESPONDENT) IT A NO. 247 0 /M/2010 ASSESSMENT YEAR: 2007 - 08 DY. COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE 42, 6 TH FLOOR, R. NO.659, AAYAKAR BHAVAN, M.K. ROAD, MUMBAI . VS. SHREE MOHAMMED A. MODI, 57, GUJJAR STREET, 1 ST FLOOR, CHASWALA BUILDING , NULL BAZAR, MUMBAI 400 003 PAN: AHQPM6131M (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI S. DIVATIA, A.R. REVENUE BY : SHRI S.D. SRIVASTAVA, D.R. DATE OF HEARING : 30.12. 2013 DATE OF PRONOUNCEMENT : 08.01.2014 O R D E R PER SANJAY GARG, JUDICIAL MEMBER: THE ABOVE NOTED CROSS APPEALS ONE FILED BY THE ASSESSEE AND THE OTHER BY THE REVENUE ARISING OUT OF THE ORDER OF THE CIT(A) DATED 28.01.10 ARE , F OR THE SAKE OF CONVENIENCE , TAKEN TOGETHER FOR DISPOSAL WIT H THIS COMMON ORDER. FIRST, WE TAKE THE APPEAL OF THE ASSESSEE. ITA NO S . 1307/M/10 & 2470/M/10 SHRI MOHAMMED A. MODI 2 ITA NO. 1307/M/2010 THE ASSESSEE IN HIS APPEAL HAS TAKEN THE FOLLOWING GROUNDS: 1.(A) THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) (LEARNED CIT(A) ) HAS ERRED IN CONFIRMING THE ADDI TION OFRS.1,44,542/ - AS UNEXPLAINED INVESTMENT IN JEWELLERY. (B) THE LEARNED CIT(A PPEALS) HAS FAILED TO APPRECIATE THE SUBMISSIONS OF THE APPELLANT AND HAS CONFIRMED THE ADDITION WITHOUT ANY JUSTIFICATION. (C) THE APPELLANT PRAYS THAT THE ADDITI ON CONFIRMED OF RS.1,44,542/ - TO THE INCOME OF APPELLANT BE DELETED. 2. (A) THE LEARNED CIT(APPEALS) HAS ERRED IN CONFIRMING THE JEWELLERY WORTH RS.584319 BELONGING TO MR. SHABIR BHAI AHMEDABADWALA & OF RS.56000 BELONGING TO MR. BURHANUDDIN NAJAFI AS UNE XPLAINED INVESTMENTS OF APPELLANT. (B) THE LEARNED CIT (APPEALS) HAS FAILED TO APPRECIATE THE FACT THAT THE JEWELLERY BELONGED TO MR. SHABIR BHAI AHMEDABADWALA & MR. BURHANUDDIN NAJAFI AND THE SAME CANNOT BE TREATED AS UNEXPLAINED INVESTMENT IN THE H AND OF APPELLANT. (C) THE APPELLANT PRAYS THAT, IN THE FACTS AND CIRCUMSTANCES OF APPELLANTS CA SE, THE ADDITION MADE OF RS.6,43,319/ - TO THE INCOME OF THE APPELLANT BE DELETED. 3. (A) THE LEARNED CIT (APPEALS) HAS ERRED IN CONFIRMING THE ADDITION OF RS.8,49,000/ - , RS.4,10,000/ - & RS.13,32,300/ - TO THE INCOME OF THE APPELLANT AS UNEXPLAINED CASH CREDITS. (B) THE LEARNED CIT (APPEALS) HAS FAILED TO APPRECIATE THE FACT THAT IN THE FACTS & CIRCUMSTANCES OF THE APPELLANTS CASE AND IN VIEW OF THE AP PELLANTS SUBMISSIONS, NO ADDITIONS WERE CALLED FOR IN THE HANDS OF THE APPELLANT IN RESPECT OF THE ABOVE AMOUNTS. (C) THE APPELLANT PRAYS THAT THE AFORESAID ADDITIONS CONFIRMED BY LEARNED CIT (APPEALS) TO THE INCOME OF THE APPELLANT BE DELETED. ITA NO S . 1307/M/10 & 2470/M/10 SHRI MOHAMMED A. MODI 3 4. THE APPELLANT CRAVES LEAVE TO ADD TO, AMEND, ALTER AND SUBSTANTIATE THE ABOVE GROUNDS AT THE TIME OF HEARING. APART FROM THAT , THE ASSESSEE HAS ALSO MOVED AN APPLICATION FOR TAKING TWO ADDITIONAL GROUNDS, WHICH HAS NOT BEEN OPPOSED BY THE LD. D.R. IN VIEW OF THE AVERMENTS MADE IN THE SAID APPLICATION , THE ADDITIONAL GROUNDS PROPOSED BY THE ASSESSEE ARE HEREBY ALLOWED TO BE TAKEN AND THE SAME ARE REPRODUCED AS UNDER: 1. THE LEARNED CIT (A) ERRED IN CONFIRMING AN ADDITION OF RS.1,90,800/ - PAID TO VARIOUS LABOURERS, AS UNEXPLAINED LOAN ADVANCED TO VARIOUS PARTIES. 2. THE LEARNED CIT (A) HAS ERRED IN NOT ADJUDICATING THE GROUND IN RELATION TO AN ADDITION OF RS.7,54,324/ - AS UNEXPLAINED CASH CREDIT UNDER SECTION 68 OF THE ACT. 2. THERE WAS A SEA RCH ACTION UNDER SECTION 1 3 2 OF THE INCOME TAX ACT AT THE RESIDENCE OF THE ASSESSEE ON 14.03.07. DURING THE COURSE OF SEARCH , JEWELLERY WORTH RS.22,42,399/ - AND CASH OF RS.19.06 LAKHS WAS FOUND AT THE RESIDENCE OF THE ASSESSEE , OUT OF WHICH JEWELLERY WORT H RS.10 , 45 , 039/ - AND CASH WORTH RS.10 LAKHS WERE SEIZED. A STATEMENT OF THE ASSESSEE WAS ALSO RECORDED UNDER SECTION 131 OF THE INCOME TAX ACT. CONSEQUENTLY THE RE ASSESSMENT PROCEEDINGS FOR THE BLOCK PERIOD OF SEVEN YEARS I.E. FROM ASSESSMENT YEAR 2001 - 0 2 TO 2007 - 08 WERE INITIATED. THE VARIOUS ISSUES RELATING TO THE ASSESSMENTS MADE UNDER SECTION 143(3) READ WITH SECTION 153A OF THE INCOME TAX ACT WERE TRAVELLED UP TO THE LEVEL OF THE TRIBUNAL AND WERE DECIDED BY WAY OF A CONSOLIDATED ORDER DATED 24.11.1 0 OF THE ITAT, MUMBAI. HOWEVER, THE ASSESSEE THEREAFTER MOVED A MISCELLANEOUS APPLICATION TO THE TRIBUNAL , STATING THAT THE ISSUE S INVOLVED FOR ASSESSMENT YEAR 2007 - 08 WERE DIFFERENT AND HAD NOT BEEN ADJUDICATED BY THE TRIBUNAL. HENCE, THE ORDER OF THE ITA NO S . 1307/M/10 & 2470/M/10 SHRI MOHAMMED A. MODI 4 T RIBUNAL DATED 24.11.10 WAS RECALLED FOR THIS PARTICULAR ASSESSMENT YEAR I.E. ASSESSMENT YEAR 2007 - 08 FOR FRESH ADJUDICATION ON THE IS S UES, HENCE, THIS ORDER. 3. IN THE FIRST GROUND OF APPEAL, THE ASSESSEE HAS CONTESTED THE ADDITION OF RS. 1,44,542/ - AS UN EXPLAINED INVESTMENT IN JEWELLERY. DURING THE COURSE OF SEARCH, JEWELLERY WORTH RS.22,42,399/ - WAS FOUND AT THE RESIDENCE OF THE ASSESSEE OUT OF WHICH JEWELLERY WORTH RS. 10,45,039/ - WAS SEIZED. IN HIS STATEMENT RECORDED UNDER SECTION 131 OF THE INCOME TA X ACT THE ASSESSEE HAD STATED THAT PART OF JEWELLERY SO FOUND BELONGED TO HIS WIFE NAMELY MRS. TASNEEM M. MODI , CLAIMED TO BE RECEIVED BY HER FROM RELATIVES AT CERTAIN OCCASIONS SUCH AS AT THE TIME OF HER MARRIAGE AND AT THE TIME OF BIRTH OF CHILDREN. TH E JEWELLERY STOOD SHOWN IN THE BALANCE SHEET OF THE ASSESSEE FOR ASSESSMENT YEAR 2001 - 02 AT RS.2,03,647/ - AND IN THE BALANCE SHEET OF HIS WIFE MRS. TASNEEM M. MODI AT RS.1,48,657/ - . THE AO SINCE HAD REJECTED THE BOOKS OF ACCOUNT FOR EARLIER Y EARS , HE THEREFORE ALSO REJECTED THE BOOKS OF ACCOUNT FOR THIS YEAR ALSO. THE AO THEREAFTER ESTIMATED THE RECEIPT OF GIFTS IN THE SHAPE OF JEWELLERY AT 350 GMS. AND WORKED OUT THE VALUE OF JEWELLERY BY TAKING THE RATE OF GOLD AS ON 31.03.06 AND THE VALUE OF THE EXCESS GOLD JEWELLERY WAS ADDED BACK INTO THE INCOME OF THE ASSESSEE WHICH WAS WORKED OUT AT RS.3,11,738/ - . IN APPEAL, THE LD. CIT(A) OBSERVED THAT THE AO HAD MENTIONED THE FACT OF PURCHASE OF JEWELLERY AT RS.1,67,196/ - IN THE ASSESSMENT YEAR 200 6 - 07. HE THEREFORE ALLOWED THE BENEFIT OF JEWELLERY WORTH RS. 1,67,196/ - PURCHASED DURING ASSESSMENT YEAR 200 6 - 07. HOWEVER, HE REJECTED THE CONTENTION OF THE ASSESSEE THAT THE VALUE OF THE JEWELLERY SHOULD BE ADOPTED TAKING THE RATES OF THE GOLD AS ON 01.04 .95. THUS THE CIT(A) REDUCED THE ADDITION MADE BY THE AO UNDER THIS HEAD TO RS.1,44,542/ - . THE ASSESSEE IS THUS IN APPEAL BEFORE US. 4 . BEFORE US , THE CONTENTION OF THE LD. AR OF THE ASSESSEE HA S BEEN THAT THE LD. CIT(A) HAD SET ASIDE THE ACTION OF TH E AO IN REJECTING THE BOOKS OF ACCOUNT ITA NO S . 1307/M/10 & 2470/M/10 SHRI MOHAMMED A. MODI 5 OBSERVING THAT THE ASSESSEE WAS REGULARLY FILING RETURNS FOR EARLIER YEARS AND THE CAPITAL ACCOUNTS/BALANCE SHEETS WERE REGULARLY SUBMITTED ALONG WITH RETURNS AND THERE WAS NO JUSTIFICATION FOR THE AO TO REJECT THE BO OKS OF ACCOUNTS. HE THEREFORE ACCEPTED THE BOOKS OF ACCOUNT OF THE ASSESSEE. THE LD. AR HAS FURTHER SUBMITTED THAT THE ASSESSEE HAS BEEN REGULARLY SHOWING THE RATES OF JEWELLERY IN HIS BALANCE SHEET FROM THE ASSESSMENT YEAR 1994 - 95 ONWARDS . HE HAS FURTH ER SUBMITTED THAT SINCE T H E BOOKS OF ACCOUNT FOR ASSESSMENT YEAR 20 01 - 02 HAVE BEEN ACCEPTED BY THE CIT(A), HENCE THE RATES OF THE JEWELLERY AS ON 31.03.2006 SHOULD HAVE BEEN ADOPTED AND NOT THAT OF YEAR 2006. ON THE OTHER HAND THE LD. D.R. HAS RELIED UP ON THE AO. 5. WE HAVE CONSIDERED THE RESPECTIVE SUBMISSIONS OF THE LD. REPRESENTATIVES OF THE PARTIES. THE ASSESSEE HAS BEEN REGULARLY SHOWING THE ACQUISITION /PURCHASE OF JEWELLERY IN HIS BALANCE SHEET FILED ALONG WITH HIS INCOME TAX RETURNS SINCE THE A SSESSMENT YEAR 1995 - 96. THE LD. CIT(A) HAS ALSO ASSAILED THE ACTION OF AO IN REJECTING THE BOOKS OF ACCOUNTS OF THE ASSESSEE WHICH THE ASSESSEE HAD BEEN MAINTAINING IN THE REGULAR COURSE OF BUSINESS AND THUS HAS ACCEPTED THE BOOKS OF ACCOUNTS OF THE ASSE SSEE FOR THE ASSESSMENT YEAR 2001 - 02. IT IS AN ADMITTED CASE THAT THE JEWELLERY IS SHOWN IN THE BALANCE SHEET BY THE ASSESSEE FOR THE FINANCIAL YEAR ENDING ON 31.03. 20 01. HENCE , IT IS CLEAR THAT THE JEWELLERY WAS ACQUIRED BY THE ASSESSEE ON OR BEFORE 31. 03.01. UNDER SUCH CIRCUMSTANCES THE RATES OF THE GOLD JEWELLERY AT THE MOST CAN BE ADOPTED AS THAT WERE ON 31.03.01 AND THERE WAS NO JUSTIFICATION FOR THE AO TO ADOPT THE RATES AS ON 31.03.06. ACCORDINGLY, THE CONTENTION OF THE LD. COUNSEL FOR THE ASSESS EE IS ACCEPTED AND THE AO IS DIRECTED TO ADOPT THE RATES OF THE GOLD JE WELLERY AS ON 31.03.01 AND WORK OUT THE UNEXPLAINED INVESTMENT , IF ANY , ACCORDINGLY. ITA NO S . 1307/M/10 & 2470/M/10 SHRI MOHAMMED A. MODI 6 GROUND NO.2 6 . DURING THE SEARCH OPERATION JEWELLERY WORTH RS.11,89,039/ - WAS FOUND WHICH WAS CL AIMED TO BE BELONGING TO DIFFERENT PERSONS AS MENTIONED BELOW: NAME AMOUNT 1. MRS. ZAINAB GANDHI RS.4,04,720/ - 2. MRS. NASIM MODI RS. 80,000/ - 3. MR. SHAUKAT B HAI MODI RS.64,000/ - 4. MR. SHABIR B HAI AHMEDABADWALA RS.5,84,319/ - 5. MR. BURH ANUDDIN BHAI RS.56,000/ - 7 . AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE AND EXAMINING THE CONCERNED PERSONS , THE AO REJECTED THE CLAIM OF THE ASSESSEE IN CASES OF MRS. ZAINAB GANDHI , MR. SHABIR BHAI AHMEDABADWALA AND MR. BURHANUDDIN BHAI . IN FIRS T APPEAL, THE LD. CIT(A) DELETED THE ADDITION OF RS.4,04,720/ - RELATING TO JEWELLERY OF MRS. ZAINAB GANDHI. HOWEVER, HE CONFIRMED THE ADDITIONS MADE IN THE CASE OF OTHER TWO PERSONS OBSERVING THAT THE ASSESSEE HAS FAILED TO PROVE THAT THE SAID JEWELLERY B ELONG TO THE SAID PER SONS. THE ASSESSEE HAS THUS COME INTO APPEAL AGAINST THE CONFIRMATION OF ADDITION IN CASE OF JEWELLERY CLAIMED TO BE BELONGING TO MR. SHABIR B HAI AHMEDABADWALA AND MR. BURHANUDDIN BHAI AND ON THE OTHER HAND THE REVENUE HAS COME INTO APPEAL AGAINST THE DELETION OF ADDITION MADE IN THE CASE OF JEWELLERY CLAIMED TO BE BELONGING TO MRS. ZAINAB GANDHI. 8 . THE CASE OF THE ASSESSEE IS THAT THE ABOVE PERSONS HAD DEPOSITED THE JEWELLERY WITH THE ASSESSEE FOR FACILITATION OF LOAN THROUGH HI M FROM M/S. BURHANI QUARZEN HASANAH TRUST , A S THE SAID TRUST ADVANCES INTEREST FREE LOAN TO DAW OO DI BOH A RA MUSLIM S AGAINST SECURITY OF GOLD. IT WAS FURTHER CLAIMED THAT THE SAID PERSONS DID NOT APPLY DIRECTLY TO THE SAID TRUST AS THEY WERE NOT ACQUAINTED WITH THE PROCEDURE AND NECESSARY FORMALITIES REQUIRED IN THE SAID ITA NO S . 1307/M/10 & 2470/M/10 SHRI MOHAMMED A. MODI 7 LOAN MATTER. IT WAS CLAIMED BY THE ASSESSEE THAT THE ASSESSEE ON THE DATE OF SEARCH HAD NOT APPLIED FOR THE LOAN OF THE ABOVE SAID PERSONS , HENCE THE GOLD/JEWELLERY OF THE ABOVE SAID PERSON S WAS LYING WITH THE ASSESSEE. THE AO THOUGH ADMITTED THE CLAIM OF THE ASSESSEE RELATING TO THE CASE OF MRS. TASNEEM M. MODI AND MR. SH AU KAT B HAI MODI AFTER EXAMINING THE SAID PERSONS , HOWEVER, REJECTED THE CLAIM IN RELATION TO OTHER THREE PERSONS. THE C LAIM IN THE CASE OF MRS. ZAINAB GANDHI AND MR. SHABIR B HAI AHMEDABADWALA WAS REJECTED FOR WANT OF PROOF OF FINANCIAL STATUS AND PURCHASE OF JEWELLERY ETC. BY THE SAID PERSONS AND IN CASE OF MR. BURHANUDDIN BHAI, THE CLAIM WAS REJECTED BECAUSE HE WAS NOT PR ODUCED FOR HIS EXAMINATION BEFORE THE AO. 9. THE LD. CIT(A) DELETED THE ADDITIONS IN CASE OF MRS. ZAINAB GANDHI OBSERVING THAT IN HER STATEMENT , SHE HAD CATEGORICALLY CONFIRMED THAT JEWELLERY WAS OWNED BY HER AND IT WAS GIVEN BY HER TO HER BROTHER - IN - LA W I.E. THE ASSESSEE , FOR OBTAINING THE LOAN FROM THE TRUST I.E. M/S. BURHANI QUARZEN HASANAH TRUST . AT THE TIME OF SEARCH, IDENTICAL STATEMENT WAS MADE BY THE ASSESSEE AND THERE WAS NO CONTRADICTION BETWEEN THE STATEMENT OF THE ASSESSEE AND SAID MRS. ZAIN AB GANDHI. THE JEWELLERY WAS FOUND IN A SEPARATE P ACKET BEARING THE NAME OF MRS. ZAINAB GANDHI ON THE PACKET. THE LD. CIT(A) FURTHER OBSERVED THAT MERELY BECAUSE THE FINANCIAL CAPACITY OF MRS. ZAINAB GANDHI WAS LIMITED OR SHE WAS HAVING A NOMINAL FAMILY INCOME , WAS ITSELF NOT THE CORRECT BASIS TO DISBELIE VE HER OWNERSHIP OVER THE JEWELLERY. 10. HOWEVER, IN CASE OF MR. SHABIR B HAI AHMEDABADWALA, THE CLAIM WAS REJECTED BECAUSE THE SAID MR. SHABIR B HAI AHMEDABADWALA COULD NOT PRODUCE THE BILLS OF PURCHAS E OF GOLD BISCUITS WHICH WERE ALLEGEDLY DEPOSITED BY HIM WITH THE ASSESSEE. IT WAS FURTHER OBSERVED THAT THERE WAS NO JUSTIFICATION BY HIM TO FIRSTLY PURCHASED THE GOLD BISCUITS AND THEN TO DEPOSIT THE SAME FOR GETTING THE LOAN. ITA NO S . 1307/M/10 & 2470/M/10 SHRI MOHAMMED A. MODI 8 HOWEVER, IN THE CASE OF MR. BURHANUDDIN BHAI , THE CLAIM WAS REJECTED BECAUSE THE SAID PERSON WAS NOT PRODUCED FOR HIS EXAMINATION. 11 . IT IS AN ADMITTED CASE THAT THE JEWELLERY/ GOLD CLAIMED TO BE BELONGING TO DIFFERENT PERSONS WAS FOUND IN SEPARATE PACKETS UNDER THEIR NAME. T HE ASSESSEE HAD ALSO GIVEN A REASONABLE EXPLANATION THAT THE SAID PERSONS HAD DEPOSITED THE GOLD WITH THE ASSESSEE FOR THE FACILITATION OF GRANT OF INTEREST FREE LOAN FOR THE SAID PERSONS THROUGH M/S. BURHANI QUARZEN HASANAH TRUST. AFTER EXAMINING THE SAID PERSONS EXCEPT MR. BURHANUDDIN BHAI , WHO WAS SAID TO BE RESIDING IN KUWAIT, THE CLAIM IN RESPECT OF TWO PERSONS WAS ADMITTED BY THE AO. FURTHER T HE LD. CIT(A) REJECTED THE CONTENTION OF THE AO IN THE CASE OF MRS. ZAINAB GANDHI OBSERVING THAT MERELY BECA USE THE FAMILY INCOME OF MRS. ZAINAB GANDHI WAS NOMINAL , THAT ITSELF COULD NOT BE A GROUND TO REJECT THE CONTENTION OF THE ASSESSEE WHICH WAS FURTHER CORROBORATED WITH THE STATEMENT OF MRS. GANDHI. 11. THE ASSESSEE HAD MADE STATEMENT AT THE TIME OF SEAR CH ABOUT THE DEPOSIT OF JEWELLERY BY THE ABOVE SAID PERSONS WHICH WAS FURTHER CORROBORATED WITH THE STATEMENT OF THOSE PERSONS. THE FACT OF RECOVERY OF JEWELLERY IN SEPARATE PACKETS IN THEIR NAME ITSELF WAS A VERY RELEVANT FACT IN RELATION TO CLAIM OF THE ASSESSEE THAT THE SAID JEWELLERY BELONG ED TO THOSE PERSONS. EVEN THE CLAIM OF THE ASSESSEE IN RESPECT OF TWO PERSONS WAS ADMITTED BY THE AO HIMSELF AND IN CASE OF THIRD PERSON I.E. MRS. GANDHI, BY THE LD. CIT(A). EVEN IF , ONE OR TWO OF THEM COULD NOT GIV E THE EXACT PROOF OF PURCHASE OF JEWELLERY IN THE SHAPE OF BILLS ETC. THAT ITSELF ALONE CANNOT BE A BASIS TO HOLD THAT SAID JEWELLERY DID NOT BELONG TO THE SAID PERSONS , ESPECIALLY, IN THE PRESENCE OF OTHER CORRELATING EVIDENCE SUPPORTING THE CLAIM OF THE ASSESSEE . ITA NO S . 1307/M/10 & 2470/M/10 SHRI MOHAMMED A. MODI 9 1 2 . SO FAR THE FINDING OF THE LD. CIT(A) IN DELETING THE ADDITION MADE IN THE CASE OF JEWELLERY CLAIMED TO BE BELONGING TO MRS. ZAINAB GANDHI IS CONCERNED, IN VIEW OF OUR OBSERVATIONS MADE ABOVE, WE DO NOT FIND ANY INFIRMITY IN THE SAME AND HI S FINDING IN THIS RESPECT OF THE MATTER IS HEREBY UPHELD. 13. IN THE CASE OF MR. SHABIR BHAI AHMEDABADWALA, T HE REASONING GIVEN BY THE LD. CIT(A) , WHILE CONFIRMING THE ADDITION, THAT WHY A PERSON WOULD PURCHASE GOLD BISCUITS AND THEN DEPOSIT THE SAME FOR OBTAINING LOAN, IN OUR VIEW , IS NOT WELL FOUNDED. IT IS A COMMON PRACTICE IN INDIA THAT PEOPLE GENERALLY INVEST THEIR MONEY IN PURCHASE OF GOLD BECAUSE OF THE MARKET TREND OF RISE IN PRICES OF THE GOLD. THE PURCHASE OF GOLD IS ALSO A CUSTOMARY PRACTI CE IN INDIA. THE GOLD BISCUITS WERE ALLEGEDLY DEPOSITED BY THE SAID MR. SHABIR B HAI AHMEDABADWALA FOR GETTING INTEREST FREE LOAN WHICH COULD HAVE BEEN USED FOR HIS BUSINESS OR/OTHER REQUIREMENTS , B UT AT THE SAME TIME , HE WOULD HAVE BEEN GETTING THE BENEFIT OF APPRECIATION IN THE PRICE OF GOLD BISCUITS WHICH ULTIMATELY BELONG ED TO HIM. IT WAS NOT THE CASE OF SALE OF JEWELLERY BUT IT WAS A CASE OF DEPOSIT OF GOLD AS A SECURITY. THE SAID BISCUITS WERE FOUND IN SEPARATE PACKET IN HIS NAME AND HE HAD ALSO DISC LOSED AS TO WHERE FROM HE HAD PURCHASED THE GOLD AND ON WHICH DATE. UNDER SUCH CIRCUMSTANCES , WE DO NOT FIND ANY JUSTIFICATION IN THE ACTION OF THE LOWER AUTHORITIES IN HOLDING THAT THE SAID JEWELLERY DID NOT BELONG TO MR. SHABIR B HAI AHMEDABADWALA. ACCO RDINGLY, THE ADDITION MADE RELATING TO THE JEWELRY BELONG IN G TO MR. SHABIR B HAI AHMEDABADWALA IS HEREBY ORDERED TO BE DELETED. 1 4 . SO FAR THE CASE RELATING TO JEWELRY OF MR. BURHANUDDIN BHAI IS CONCERNED, THE EVIDENTIARY POSITION IS SAME AS IN THE CASE O F OTHER PERSONS EXCEPT THAT HE WAS NOT PRODUCED FOR EXAMINATION BEFORE THE AO . H IS ABSENCE HA D BEEN WELL EXPLAINED BY THE ASSESSEE THAT HE WAS NOT IN INDIA AT THAT TIME BUT WAS RESIDING IN KUWAIT. HOWEVER, HIS DULY SWORN STATEMENT/AFFIDA VIT WAS ITA NO S . 1307/M/10 & 2470/M/10 SHRI MOHAMMED A. MODI 10 FILED BEF ORE THE AO VIDE WHICH HE CLAIMED THAT THE SAID JEWELLERY BELONG ED TO HIM. UNDER SUCH CIRCUMSTANCES, THE ADDITION MADE IN CASE OF MR. BURHANUDDIN BHAI CANNOT BE SUSTAINED AND IS HEREBY ORDERED TO BE DELETED. GROUND NO.2 OF THE ASSESSEES APPEAL IS THUS AL LOWED AND GROUND NO.1 OF THE REVENUES APPEAL IS DISMISSED. GROUND NO.3 1 5 . DURING COURSE OF SEARCH, CERTAIN LOOSE PAPERS WERE FOUND. ASSESSEE WAS ASKED VIDE LETTER DATED 18.08.2008 THAT THE SAID LOOSE PAPERS SHOW ED MONEY DISTRIBUTED TO VARIOUS PERSONS AND HENCE TO EXPLAIN THE SOURCE OF SUCH CASH AND PURPOSE FOR THE SAME. IN RESPONSE , THE ASSESSEE EXPLAINED THAT THE SAID PAPERS WERE ROUGH NOTINGS OF CASH BROUGHT AT THE RESIDENCE FROM THE OFFICE OF THE COMPANY M/S. HATIM ALLUMINIUM & GLASS TRADERS PVT. LTD. AND CASH TAKEN TO THE OFFICE FROM THE RESIDENCE. T HE CASH WAS GENERALLY KEPT BY D IRECTORS AT RESIDENCE AS THERE WAS A FEAR OF THEFT IN THE OFFICE PREMISES . THE NARRATION OF THE LOOSE PAPERS WHICH WERE WRITTEN IN GUJRATHI WAS AS UNDER : ( I ) PAGE 1 OF T HE SEIZED MATERIAL RS.49,000/ - --- OUTSTANDING RECEIVED FROM KANJI. RS.2,00,000/ - --- GIVEN TO ASGAR MAMA RS. 3,00,000/ - --- GIVEN TO YOUSUF GANDHI RS.1,40,000/ - --- RECEIVABLE FROM MURTUZA RS. 40,000/ - --- RECEIVABLE FROM BURHAN NAZFI RS.2 ,00,000/ - --- GIVEN TO BUJIA TOTAL . RS.9,29,000/ - THE A O OBSERVED THAT THE EXPLANATION GIVEN BY THE ASSESSEE WAS NOT CONVINCING AND COULD NOT BE CORROBORATED BY HIM WITH ENTRIES IN HIS BOOKS OF ACCOUNT AND ALSO THAT ASSESSEE HA D ADVANCED LOAN TO MR. SHAUKAT BHAI ITA NO S . 1307/M/10 & 2470/M/10 SHRI MOHAMMED A. MODI 11 AMOUNTING TO RS.40,000/ - BY TAKING JEWELLERY FROM HIM, MONEY LENDING ACTIVITIES OF THE ASSESSEE WERE ESTABLISHED. FURTHER IN THE SECOND PAGE IT INDICATED THAT MR. YUSUF GANDHI HAD PAID BACK RS.80,000/ - . THUS, THE OUTSTANDING AMOUNT OF RS.8, 49,000/ - I.E (RS.9,29,000 RS.80,000/ - ) WAS TREATED AS UNACCOUNTED LOAN ADVANCE D BY THE ASSESSEE, RETURNABLE ON THE DATE OF SEARCH. THUS, RS.8,49,000/ - WAS ADDED AS UNACCOUNTED LOAN ADVANCE, AND OUTSTANDING ON THE DATE OF SEARCH. ( II ) PAGE 2 OF THE SEIZED MATERIAL I ) RS.12,50,000/ - --- IN TIJORI (MEANING SAFE) II ) RS.8,00,000/ - --- MONEY WITHDRAWN FROM BANK III ) RS.5,00,000/ - --- SELF IV ) RS.80,000/ - --- RECEIVED FROM YUSUF GANDHI V ) BALANCE --- RS.2,20,000/ - VI ) RS.19,00,000/ - --- GIVEN TO MR. MOHAMMAD THE A O FURTHER O BSERVED THAT ENTRY NO.(I) INDICATE D MONEY IN THE SAFE, ENTRY NO.(II) INDICATE D MONEY WITHDRAWN FROM THE BANK, ENTRY NO.(III) INDICATE D MONEY TAKEN BY THE ASSESSEE , HENCE ADDITION WAS NOT MADE ON THIS ACCOUNT. HOWEVER , HE OBSERVED THAT ENTRY NO.(IV) WAS R ELATING TO MONEY RECEIVED FROM THE YUSUF GANDHI AND ENTRY NO.(V) WAS THE BALANCE OF YUSUF GANDHI WHICH WAS CONSIDERED IN THE ADDITION OF LOOSE - PAPER PAGE 1 . ASSESSEE WAS NOT ABLE TO SHOW CASH BALANCE OF RS.19,00,000/ - IN HIS BOOKS OF ACCOUNT TO ESTABLISH THAT MONEY WAS RECEIVED BY HIM. THUS IT WAS HELD THAT THIS AMOUNT WAS ADVANCED TO ONE MR. MOHAMMAD OTHER THAN ASSESSEE AND HENCE ADDED AS UNACCOUNTED LOAN ADVANCED AMOUNTING TO RS.19,00,000/ - TO MR. MOHAMMAD AND OUTSTANDING ON THE DATE OF SEARCH. (III ) PAGE 2 (BACK) OF THE SEIZED MATERIAL TO GET FROM NASIMS HUSBAND --- RS.2,00,000/ - RECEIVED AUGUST, 2006 --- RS.10,000/ - ITA NO S . 1307/M/10 & 2470/M/10 SHRI MOHAMMED A. MODI 12 RECEIVED SEP., 2006 --- RS.10,000/ - RECEIVED OCT., 2006 --- RS.10,000/ - RECEIVED NOVEMBER, 200 6 --- RS.10,000/ - RECEIVED DECEMBER, 2006 --- RS.10,000/ - RECEIVED JANUARY, 2007 --- RS.10,000/ - RECEIVED FEBRUARY, 2007 --- RS.10,000/ - THE AO OBSERVED THAT THE ABOVE ENTRIES DENOTE D MONEY ADVANCED TO NASIMS HUSBAND AMOUNTING TO RS.2,00,000/ - OUT OF WHICH RS.70,000/ - WAS RECEIVED BACK ON VARIOUS DATES. HENCE , THE BALANCE OF RS.1,30,000/ - WAS ADDED AS UNACCOUNTED LOAN ADVANCED AND OUTSTANDING ON THE DATE OF SEARCH. (IV) PAGE 3 OF THE SEIZED MATERIAL RASHID HAS BEEN GIVEN --- RS.2,50,000/ - TAKEN BACK --- RS.1,65,000/ - BALANCE --- RS.85,000/ - YUSUF HAS BEEN GIVEN --- RS.2,40,000/ - FURTHER GIVEN --- RS.85,000/ - TOTAL --- RS.3,25,000/ - MADVI SHAUKAT GIVEN --- RS.40,000/ - THE A O OBSERVED THAT T HE LAST ENTRY SHOWN IN PAGE 3 I.E. MADVI SHAUKAT WAS GIVEN A LOAN OF RS.40,000/ - WAS ESTABLISHED BY THE RECEIVER IN HER STATEMENT AND THE ASSESSEE HA D SHOWN THIS AMOUNT ON THE ASSET SIDE OF THE BALANCE AS LOAN ADVANCE AND HENCE ACCOUNTED. HOWEVER , T HE MONEY ADVANCED TO MR. RASHID AMOUNTING TO RS.85,000/ - AND TO MR. YUSUF AMOUNTING TO RS.3,25,000/ - TOTALING RS.4,10,000/ - WAS ADDED AS UNACCOUNTED LOAN ADVANCED AND OUTSTANDING ON THE DATE OF SEARCH. (V) PAGE 4 OF THE SEIZED MATERIAL 01.03.07 44,700/ - GIVEN TO RASHI D ITA NO S . 1307/M/10 & 2470/M/10 SHRI MOHAMMED A. MODI 13 02.03.07 77,000/ - RECEIVED FROM RASHID 02.03.07 10,000/ - SELF 03.03.07 3,50,000/ - GIVEN TO RASHID (VI) PAGE 5 OF THE SEIZED MATERIAL 10.03.07 9,00,000/ - RECEIVED FROM RASHID 10.03.07 7,50,000/ - RECEIVED FROM RASHID ON MAKING A SUMMARY OF THE TRANSACTION S OF PAGE 4 & 5 OF THE SEIZED MATERIAL THE A O OBSERVED THAT THE ASSESSEE HAD RECEIVED RS.1 7 ,2 7 , 0 0 0/ - FROM MR. RASHID, OUT OF WHICH , HE HAD RETURNED RS.3,94,700/ - TO RASHID. THIS AMOUNT RECEIVED IN CASH FROM MR. RASHID ENTERED IN THE LOOSE PAPER SEIZED BY THE DEPARTMENT WAS CONSIDERED AS CASH CREDITS U/S. 68. THUS THE AMOUNT OF RS.13,32,300/ - (RS.1727000 RS.394700) WAS ADDED TO THE TOTAL INCOME OF THE ASSESSEE U/S 68 AS UNEXPLAINED CASH CREDIT. 1 6 . IN FIRST APPEAL, THE LD. CIT(A) OBSERVED THAT THE CONTENTS OF THE LOOSE PAPERS WERE IN THE HANDWRITING OF THE WIFE OF THE APPELLANT. THE CASE OF THE ASSESS E E WAS THAT THOSE ENTRIES ON LOOSE PAPERS PERTAINED TO THE MOVEMENT OF CASH BETWEEN THE RESIDENCE OF THE ASSESSEE AND THE OFF ICE OF THE COMPANY AND WERE RECORDED BY HIS WIFE FOR ROUGH ACCOUNTING PURPOSES. T HE ONUS WAS ON THE ASSESSEE TO EXPLAIN THE NATURE AND SOURCE OF CASH INDICATED IN THOSE ENTRIES. HOWEVER , HE OBSERVED THAT THERE WAS DOUBLE ADDITION OF RS. 1 , 30 , 000/ - MADE BY THE AO RELATING TO THE ENT RIES IN THE NAME OF MR. BUJIA, NASIMS HUSBAND . THEREFORE, HE DELETED THE ADDITION OF RS. 1,30,000/ - . HOWEVER , HE CONFIRMED THE ADDITIONS RELATING TO OTHER ENT RIES OF PAGE 1 OF THE SEIZED PAPERS OBSERVING THAT THERE WAS NO E XPLANATION OFFERED BY THE ASSESS E E FOR THE SOURCE OF MONEY . WITH REGARD TO THE ARS ARGUMENT THAT MR. MOHAMMAD WAS THE ASSESSEE HIMSELF AND NOT ANY OTHER PERSON, HE OBSERVED ITA NO S . 1307/M/10 & 2470/M/10 SHRI MOHAMMED A. MODI 14 THAT ON PERUSAL OF THE CASH BOOK, IT WAS SEEN THAT THERE WAS CASH BALANCE EXCEEDIN G RS.20,00,000/ - AVAILABLE IN THE BOOKS OF THE COMPANY, THE APPELLANT AND OTHER FAMILY MEMBERS. THEREFORE, THERE WAS NO JUSTIFICATION TO DOUBT THE AVAILABILITY OF CASH OF RS.19,00,000/ - AT THE ASSESSEES RESIDENCE. HE DID NOT AGREE WITH THE OBSERVATION O F THE AO THAT MR. MOHAMMAD MODI TO WHOM THE AMOUNT OF RS.19,00,000/ - WAS ADVANCED WAS SOME PERSON OTHER THAN THE ASSESSEE . HE A CCORDINGLY, DELETED THE ADDITION OF RS.19,00,000/ - PERTAINING TO THE ENTRY IN THE NAME OF MOHAMMAD MODI . IN RESPECT OF ADDITI ON OF RS.4,10,000/ - MADE ON PAGE 3, HE CONFIRMED THE ADDITIONS MADE BY THE AO FINDING THE SAME TO BE CORRECTLY MADE BY THE AO. WITH REGARD TO THE ADDITION MADE AT RS.13,32,000/ - , WITH REGARD TO PAGE 4 & 5, HE OBSERVED THAT THERE WAS NO EXPLANATION FOR THE SOURCE OF THE MONEY AND E VEN THE IDENTITY OF MR. RASHID HAD NOT BEEN ESTABLISHED T O PROVE HIS BUSINESS CONNECTION WITH THE ASSESSEE , HE CONFIRMED THE ADDITION MADE AT RS.13,32,000/ - AS UNEXPLAINED CASH CREDIT FROM MR. RASHID . 1 7 . WE HAVE HEARD THE LD . REPRESENTATIVES OF BOTH THE PARTIES AND ALSO HAVE GONE THROUGH THE RECORDS. THE CONTENTION OF THE LD. REPRESENTATIVE OF THE ASSESSEE HAS BEEN THAT THE LOOSE PAPERS FOUND DURING THE SEARCH OPERATION WERE WRITTEN IN GUJARATI IN THE HANDWRITING OF THE WIFE OF THE ASSESSEE , B UT SHE WAS NOT PUT ANY QUESTIONS IN THIS RESPECT EITHER DURING THE SEARCH PROCEEDINGS OR DURING ASSESSMENT PROCEEDINGS. HE HAS FURTHER CONTENDED THAT EARLIER THERE WAS A THEFT TAKEN PLACE IN THE OFFICE OF THE COMPANY AND THEREFORE THE A SSESSEE USED TO TAKE HOME THE CASH AT THE END OF THE DAY AND BRING BACK DURING THE DAY TIME THROUGH HIS EMPLOYEES. HE HAS FURTHER CONTENDED THAT THE FINDING OF THE LD. CIT(A) THAT THE IDENTITY OF THE EMPLOYEES NAMELY MR. RASHID AND MR. YUSUF WAS NOT ESTAB LISHED WAS WRONG. HE HAS BROUGHT OUR ATTENTION TO PAGE 28 OF THE PAPER BOOK TO SHOW THAT THE SALARY WAS REGULARLY PAID TO THE ABOVE SAID ITA NO S . 1307/M/10 & 2470/M/10 SHRI MOHAMMED A. MODI 15 EMPLOYEES THROUGH BANKING CHANNEL. HE HAS FURTHER CONTENDED THAT THE AO FAILED TO TAKE NOTICE OF THE ABOVE EVIDENCE. THE AMOUNTS MENTIONED IN THE LOOSE PAPERS WERE JUST THE NOTINGS OF THE WIFE OF THE ASSESSEE RELATING TO THE AMOUNT WHICH W AS TAKEN HOME OR THEREAFTER BROUGHT TO THE OFFICE THROUGH THE EMPLOYEES OF THE ASSESSEE. HE HAS CONTENDED THAT THE AMOUNT WAS NOT DI FFERENT RATHER THE ENTRIES WERE RELATING TO TO AND FRO MOVEMENT OF THE SAME AMOUNT. HIS FURTHER CONTENTION HAS BEEN THAT THE ASSESSEE WAS NOT GIVEN PROPER OPPORTUNITY BY THE AO TO PRESENT HIS CASE AND SUBMIT NECESSARY EVIDENCE TO PROVE THAT THE ENTRIES WERE MADE BY THE WIFE OF THE ASSESSEE JUST FOR MEMORY PURPOSE , RELATING TO THE TO AND FRO MOVEMENT OF THE SAME AMOUNT. ON THE OTHER HAND THE LD. D.R. HAS CONTENDED THAT IT WAS NOT THE CASE OF THE SAME CASH RATHER AS OBSERVED BY THE AO , THE AMOUNT WAS AD VANCED TO DIFFERENT PERSONS. HE HAS ALSO CONTENDED THAT THE ASSESSEE HAS FAILED TO PROVE THAT THE NAME MR. MOHAMMED FOUND WRITTEN WAS THE NAME OF THE ASSESSEE AND NOT OF SOME OTHER PERSON , H ENCE , THE DELETION OF THE AMOUNT RELATING TO THE ENTRY IN TH E NAME OF MR. MOHAMMED BE SET ASIDE. 1 8 . WE HAVE CONSIDERED THE RESPECTIVE SUBMISSIONS OF THE LD. REPRESENTATIVES OF THE PARTIES. IT IS AN ADMITTED FACT THAT THE LOOSE PAPERS WERE WRITTEN IN GUJARATI IN THE HANDWRITING OF THE WIFE OF THE ASSESSEE. SHE WAS NEITHER EXAMINED AT THE TIME OF SEARCH PROCEDURE NOR DURING THE ASSESSMENT PROCEEDINGS. THE ASSESSEE , THROUGH THE EVIDENCE PLACED IN THE PAPER BOOK , HAS ALSO TRIED TO ESTABLISH THAT MR. RASHID AND MR. YUSUF WERE HIS EMPLOYEES AND THE PAYMENT OF SALAR Y WAS MADE TO THEM THROUGH BANKING CHANNELS. THE REVENUE HAS ALSO CONTESTED THE IDENTITY OF MR. MOHAMMED AS BEING NOT THE NAME OF ASSESSEE. A PERUSAL OF THE ASSESSMENT ORDER AS WELL AS ORDER OF THE LD. CIT(A) REVEALS THAT THE CONTENTION S OF THE ASSESSEE HA VE NOT BEEN PROPERLY LOOKED INTO BY THE LOWER AUTHORITIES. WE, ACCORDINGLY, SET ASIDE THE ISSUE ITA NO S . 1307/M/10 & 2470/M/10 SHRI MOHAMMED A. MODI 16 RELATING TO ADDITION/DELETION MADE ON ACCOUNT OF UNEXPLAINED CASH ON THE BASIS OF LOOSE PAPERS FOR FRESH ADJUDICATION. NEEDLESS TO SAY THE AO WILL GIVE PROP ER OPPORTUNITY TO THE ASSESSEE TO PRESENT HIS CASE AND ALSO ADMIT THE NECESSARY EVIDENCES WHICH MAY BE SOUGHT TO BE PRODUCED BY THE ASSESSEE BEFORE HIM AND THEREAFTER TO PASS A SPEAKING ORDER ON MERITS, RELATING TO THE ABOVE ISSUE. ADDITIONAL GROUND N OS.1 & 2: 19 . THE LD. A.R. HAS CONTENDED THAT IN RELATION TO ADDITION MADE ON AMOUNT OF PAYMENT MADE TO LABOURERS OF RS.1,90,800/ - , THE IDENTICAL ISSUE HAS BEEN DECIDED BY THE TRIBUNAL VIDE ORDER DATED 24.11.10 FOR ASSESSMENT YEARS 2001 - 02 TO 2007 - 08. HE HAS FURTHER CONTENDED THAT THE SAID ISSUE HAS NOT BEEN ADJUDICATED BY THE LD. CIT(A). SIMILARLY RELATING TO SECOND ADDITIONAL GROUND , THE LD. A.R. HAS CONTENDED THAT THE ADDITION WAS MADE BY THE AO CONSEQUENT TO REJECTION OF BOOKS OF ACCOUNTS FOR ASSESSME NT YEAR 2001 - 02. HOWEVER, SIMILAR TYPE OF ADDITION HAD BEEN DELETED BY THE LD. CIT(A) VIDE ORDER DATED 21.02.09 FOR ASSESSMENT YEAR 2001 - 02 ACCEPTING THE BOOKS OF ACCOUNTS OF THE ASSESSEE. 2 0 . SINCE THE ISSUES RAISED VIDE ADDITIONAL GROUND NOS.1 & 2 HAVE NOT BEEN ADJUDICATED BY THE CIT(A) AND FURTHER WE HAVE ALREADY RESTORED THE MATTER TO THE FILE OF THE AO RELATING TO GROUND NO.3 OF THE APPEAL OF THE ASSESSEE, HE NCE THE ISSUES RAISED VIDE ADDITIONAL GROUND NO.1 AND ADDITIONAL GROUND NO.2 IN THE APPEA L OF THE ASSESSEE ARE ALSO RESTORED TO THE FILE OF THE AO WITH A DIRECTION TO ADJUDICATE THE SAME AFRESH TAKING INTO CONSIDERATION THE ORDER OF THE TRIBUNAL DATED 24.11.10 AND THE ORDER OF THE CIT(A) DATED 21.02.09 AFTER GIVING PROPER OPPORTUNITY TO THE AS SESSEE TO PRESENT HIS CASE. ITA NO. 2470 /M/2010 THE REVENUE IN ITS APPEAL HAS RAISED THE FOLLOWING TWO GROUND S . ITA NO S . 1307/M/10 & 2470/M/10 SHRI MOHAMMED A. MODI 17 1) ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW THE CIT(A) WAS NOT JUSTIFIED IN DELETING THE ADDITION OF RS.4,04,720/ - IG NORING THE THAT JEWELLERY WAS SEIZED IN THE HANDS OF THE ASSESSEE DURING THE COURSE OF SEARCH AND OWNERSHIP OF THE JEWELLERY, THE CREDIT WORTHINESS AND GENUINENESS COULD NOT BE ESTABLISHED IN THE CASE OF THE ALLEGED OWNER MRS. ZAINAB, WHO WAS TRYING TO ACC OMMODATE THE ASSESSEE, WHO WAS HER BROTHER - IN - LAW. 2) ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE IN LAW, THE CIT(A) WAS NOT JUSTIFIED IN DECLARING THE ADDITION OF RS.19,00,000/ - MADE U/S. 69 BASES ON THE SEIZED DOCUMENTS IN THE CASE OF THE ASSE SSEE WITHOUT APPRECIATING THAT ASSESSEE COULD NOT ESTABLISH THAT THE PERSON NAMED MOHAMMED NOTED IN THE SEIZED DOCUMENTS WAS HIMSELF AND ALSO WAS UNABLE TO SHOW CASH BALANCE OF RS.19,00,000/ - IN HIS BOOK OF ACCOUNTS AND THUS FAILED TO PROVE THAT THE MONEY WAS RECEIVED BY HIM. GROUND NO.1 2 1 . IN VIEW OF OUR FINDINGS GIVEN WHILE ADJUDICATING GROUND NO.2 OF THE ASSESSEES APPEAL, THE GROUND NO.1 OF THE REVENUES APPEAL IS ACCORDINGLY DISMISSED AS OBSERVED ABOVE. GROUND NO.2 2 2 . AS OBSERVED ABOVE , WHILE A DJUDICATING GROUND NO.3 OF THE ASSESSEES APPEAL WE HAVE ALREADY RESTORED THE ISSUE RELATING TO THE ADDITIONS/DELETIONS MADE ON ACCOUNT OF UNEXPLAINED CASH ON THE BASIS OF LOOSE PAPERS TO THE FILE OF THE AO. THIS GROUND IS ACCORDINGLY DECIDED I.E. RESTORE D TO THE FILE OF THE AO FOR ADJUDICATION AFRESH ACCORDINGLY. 2 3 . IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES AND APPEAL OF THE REVENUE IS PARTLY ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 0 8.01. 2014 . SD/ - SD/ - ( P.M. JAGTAP) (SANJAY GARG) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI, DATED: 08.01. 201 4 . * KISHORE ITA NO S . 1307/M/10 & 2470/M/10 SHRI MOHAMMED A. MODI 18 COPY TO: THE APPELLANT THE RESPONDENT THE CIT, CONCERNED, MUMBAI THE CIT ( A) CONCERNED, MUMBAI THE DR C BENCH //TRUE COPY// [ BY ORDER DY/ASSTT. REGISTRAR, ITAT, MUMBAI.