M/S JAI AMARNATH ASSOCIATES, JAIPUR V. DEPUTY COMMISSIONER OF INCOME TAX, CIRCLL-3, JAIPUR

ITA 1493/JPR/2018

• Counselvise Citation: [2019] 116 COUNSELVISE.COM (IT) 2426 (ITAT-JAIPUR)
• Duration Of Justice: 8 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-09-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2016-2017
• Appeal Filed On: 24-12-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Search and seizure
• Section: 132; 143(3); 133A; 139(1); 20

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCH B, JAIPUR JH FOT; IKY JKWO] U;KF;D LNL; ,O A JH FOE FLAG ;KNO] YS[KK LNL; DS LE{K BEFORE: SHRI VIJAY PAL RAO, JM & SHRI VIKRAM SINGH YADAV, AM VK;DJ VIHY LA- @ ITA NOS. 1493/JP/2018 FU/KZKJ.K O'K Z @ ASSESSMENT YEAR : 2016-17. M/S. JAI AMARNATH ASSOCIATES, 303, RATNA SAGAR, MSB KA RASTA, JOHARI BAZAR, JAIPUR. CUKE VS. THE DCIT, CIRCLE-3, JAIPUR. LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO. AAEFJ 4733 B VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT FU/KZKFJRH DH VKSJ LS@ ASSESSEE BY : SHRI VIJAY GOYAL (CA) JKTLO DH VKSJ LS@ REVENUE BY : SHRI B.K. GUPTA (CIT) LQUOKBZ DH RKJH[K@ DATE OF HEARING : 29.08.2019. ?KKS'K .KK DH RKJH[K @ DATE OF PRONOUNCEMENT : 02/09/2019. VKNS'K@ ORDER PER VIJAY PAL RAO, J.M. THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST TH E ORDER DATED 11.10.2018 OF LD. CIT (APPEALS)-4, JAIPUR FOR THE ASSESSMENT YEAR 2016-17. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL :- 1. ON THE FACTS AND IN THE CIRCUMSTANCES AND IN L AW THE LD. CIT (A) ERRED IN SUSTAINING THE ADDITION OF RS. 2,59,140/- MADE BY LD. AO AS UNDISCLOSED INCOME OF THE ASSESSEE ON A/C OF ALLEGED UNEXPLAINED CASH FOUND DURING THE COURSE OF SEARCH. 2. THE ASSESSEE PRAYS FOR LEAVE TO ADD, TO AMEND, T O DELETE, TO MODIFY THE ALL OR ANY GROUNDS OF APPEAL ON OR BEFOR E THE HEARING OF APPEAL. 2 ITA NO. 1493/JP/2018 M/S. JAI AMARNATH ASSOCIATES, JAIPUR. 2. THE ASSESSEE IS A PARTNERSHIP FIRM AND DERIVES I NCOME FROM FINANCIAL BROKERAGE. THERE WAS A SEARCH AND SEIZURE ACTION U NDER SECTION 132 AS WELL AS THE SURVEY UNDER SECTION 133A OF THE IT ACT ON 7 TH JANUARY, 2016 ON SHRI RAMESH CHAND MANIHAR GROUP TO WHICH THE ASSESSEE BELONGS. DURIN G THE COURSE OF SEARCH PROCEEDINGS, A TOTAL CASH OF RS. 15,59,085/- WAS FO UND FROM THE PREMISES OF THE ASSESSEE AT 303, RATNA SAGAR, MSB KA RASTA, JOHARI BAZAR, JAIPUR. IN THE STATEMENT RECORDED UNDER SECTION 132(4) OF THE ACT, THE SOURC E OF CASH FOUND DURING THE SEARCH WAS EXPLAINED AND WAS ALSO ACCEPTED BY THE D EPARTMENT. THE ASSESSEE FILED ITS RETURN OF INCOME UNDER SECTION 139(1) OF THE IT ACT ON 28 TH SEPTEMBER, 2016 DECLARING TOTAL INCOME OF RS. 16,17,480/-. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE AO PROPOSED, INTER ALIA, TO MAKE A DDITION OF RS. 2,59,140/- BEING CASH FOUND DURING THE SURVEY PROCEEDINGS AT 203, RA TNA SAGAR, MSB KA RASTA, JOHARI BAZAR, JAIPUR IN CASE OF M/S. ADVENTURE GLOBAL TOUR LLP, A SISTER CONCERN OF THE ASSESSEE. THE ASSESSEE EXPLAINED BEFORE THE AO THA T THE SAID CASH FOUND AT THE PREMISES OF THE BUSINESS PLACE OF M/S. ADVENTURE GL OBAL TOUR LLP BELONGS TO THE SAID FIRM AND ALSO PRODUCED THE CASH BOOK OF M/S. A DVENTURE GLOBAL TOUR LLP. THE AO REJECTED THE SAID EXPLANATION OF THE ASSESSEE ON THE GROUND THAT DURING THE SEARCH AND SURVEY ACTION NO SUCH CASH BOOK WAS SEIZ ED OR IMPOUNDED. ACCORDINGLY, THE AO MADE THE ADDITION OF RS. 2,59,140/- TO THE T OTAL INCOME OF THE ASSESSEE. THE ASSESSEE CHALLENGED THE ACTION OF THE AO BEFORE THE LD. CIT (A) AND REITERATED ITS CONTENTION THAT THIS CASH FOUND DURING THE SURVEY B ELONGS TO M/S. ADVENTURE GLOBAL TOUR LLP. HOWEVER, THE LD. CIT (APPEALS) DID NOT A CCEPT THE SAID CONTENTION AND CONFIRMED THE ADDITION MADE BY THE AO. 3 ITA NO. 1493/JP/2018 M/S. JAI AMARNATH ASSOCIATES, JAIPUR. 3. BEFORE US, THE LD. A/R OF THE ASSESSEE HAS SUBMI TTED THAT THE CASH FOUND AT THE BUSINESS PREMISES OF THE ASSESSEE WAS DULY EXPL AINED DURING THE COURSE OF SEARCH AND SEIZURE ACTION AND IN THE STATEMENT RECO RDED UNDER SECTION 132(4). THE AO HAS NOT MADE ANY ADDITION ON ACCOUNT OF THE CASH FOUND AT THE BUSINESS PLACE OF THE ASSESSEE. HOWEVER, THE AO HAS MADE THE ADDITIO N OF CASH OF RS. 2,59,140/- WHICH WAS FOUND DURING THE SURVEY PROCEEDINGS AT 20 3, RATNA SAGAR, MSB KA RASTA, JOHARI BAZAR, JAIPUR WHICH IS NOT THE BUSINESS PREM ISES OF THE ASSESSEE. HE HAS REFERRED TO THE COPY OF PANCHNAMA AT PAPER BOOK PAG E 1 AND SUBMITTED THAT THE AUTHORIZED WARRANTS WERE ISSUED AND EXECUTED IN CAS ES OF M/S. AMARNATH ASSOCIATES, M/S. JAI AMARNATH ASSOCIATES (ASSESSEE) , M/S. AMARNATH EXIM LINKERS AND THE PARTNERS OF THESE FIRMS. THEREFORE, WHEN T HE CASH WAS FOUND AT 203, RATNA SAGAR, MSB KA RASTA, JOHARI BAZAR, JAIPUR AND THE A SSESSEES BUSINESS PREMISES IS DIFFERENT FROM THE SAID PREMISES, THEN THE SAME CAN NOT BE TREATED AS UNEXPLAINED CASH IN THE HANDS OF THE ASSESSEE. FURTHER, THERE WAS NO QUESTION ASKED BY THE DEPARTMENT DURING THE SEARCH AS WELL AS SURVEY PROC EEDINGS REGARDING THE SOURCE OF THE SAID CASH OF RS. 2,59,140/-. THOUGH THE AO HAS REFERRED TO THE STATEMENTS OF SHRI RAHUL MAHESHWARI AND MS KHUSBOO SINGH RECORDED DURING THE SEARCH PROCEEDINGS, HOWEVER, THERE IS NO ALLEGATION EVEN I N THOSE STATEMENTS THAT THE CASH FOUND AT 203, RATNA SAGAR, MSB KA RASTA, JOHARI BAA R, JAIPUR BELONGS TO THE ASSESSEE. THUS THE LD. A/R HAS SUBMITTED THAT WHEN THE ASSESSEE HAS EXPLAINED THE SOURCE OF CASH AS BELONGING M/S. ADVENTURE GLOBAL T OUR LLP, A SISTER CONCERN OF THE ASSESSEE AND ALSO PRODUCED THE CASH BOOK OF THE SAI D CONCERN, THEN IN THE ABSENCE OF ANY INCRIMINATING MATERIAL THE ADDITION MADE BY THE AO IN THE HANDS OF THE ASSESSEE IS NOT JUSTIFIED. 4 ITA NO. 1493/JP/2018 M/S. JAI AMARNATH ASSOCIATES, JAIPUR. 4. ON THE OTHER HAND, THE LD. D/R HAS SUBMITTED THA T THE CASH BOOK FILED BY THE ASSESSEE OF M/S. ADVENTURE GLOBAL TOUR LLP SHOWS ON LY THE CAPITAL INTRODUCED BY THE PARTNERS AND, THEREFORE, IN THE ABSENCE OF THE SAID CASH BOOK FOUND OR SEIZED DURING THE SEARCH AND SURVEY PROCEEDINGS, THE SAME CANNOT BE ACCEPTED IN SUPPORT OF THE EXPLANATION OF SOURCE OF CASH. HE HAS ALSO QUESTIO NED EXISTENCE OF SAID LLP AS THE ROC FEES WAS PAID ONLY ON 9 TH MARCH, 2016. THUS THIS EXPLANATION OF THE ASSESSEE IS ONLY AN AFTERTHOUGHT AND THE CASH BOOK PRODUCED IS NOTHING BUT A SELF SERVING DOCUMENT. HE HAS RELIED UPON THE ORDERS OF THE AUT HORITIES BELOW. 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AS WELL AS THE RELEVANT MATERIAL ON RECORD. WE FIND THAT DURING THE SEARCH AND SEIZURE ACTION ON 07.01.2016 THE CASH OF RS. 15,59,085/- WAS FOUND AT THE PREMISES OF THE AS SESSEE AT 303 RATNA SAGAR, MSB KA RASTA, JOHARI BAZAR, JAIPUR. THE ASSESSEE EXPLA INED THE SOURCE OF THE SAID CASH AND CONSEQUENTLY IN THE ASSESSMENT FRAMED BY THE AO UNDER SECTION 143(3) READ WITH SECTION 153B(1)(B) OF THE ACT, THE AO HAS NOT EVEN PROPOSED TO MAKE ANY ADDITION ON THAT ACCOUNT. HOWEVER, THE AO PROPOSED TO MAKE AN ADDITION OF RS. 2,59,140/- ON ACCOUNT OF UNEXPLAINED CASH FOUND DUR ING THE SURVEY CONDUCTED AT 203, RATNA SAGAR, MSB KA RASTA, JOHARI BAZAR, JAIPU R. WE FURTHER NOTE THAT THOUGH THE ENTIRE PROCEEDINGS OF SEARCH AND SEIZURE AS WEL L AS SURVEY WAS CONDUCTED SIMULTANEOUSLY AT BOTH THE PLACES, HOWEVER, ASSESSE E WAS NOT CONFRONTED WITH THE CASH OF RS. 2,59,140/- FOUND AT 203, RATNA SAGAR, M SB KA RASTA, JOHARI BAZAR, JAIPUR AT THE TIME OF STATEMENT RECORDED UNDER S ECTION 132(4) OF THE ACT. FURTHER, NO SUCH QUERY WAS RAISED BY THE DEPARTMENT E VEN TO SHRI RAHUL MAHESHWARI AND MS. KHUSBOO SINGH WHOSE STATEMENTS WERE REFERRE D BY THE AO IN THE ASSESSMENT ORDER. THEREFORE, THERE IS NO MATERIAL O N RECORD TO INDICATE THAT THE CASH 5 ITA NO. 1493/JP/2018 M/S. JAI AMARNATH ASSOCIATES, JAIPUR. OF RS. 2,59,140/- WAS FOUND AT 203 RATNA SAGAR, MSB KA RASTA, JOHARI BAZAR, JAIPUR BELONGS TO THE ASSESSEE. IT IS ALSO NOT IN DISPUTE THAT THE PREMISES AT 203 RATNA SAGAR, MSB KA RASTA, JOHARI BAZAR DOES NOT BELONG T O ASSESSEE BUT IT BELONGS TO THE OTHER SISTER CONCERN OF THE ASSESSEE. THE ASSESSEE EXPLAINED THE SOURCE OF CASH AS BELONGS TO M/S. ADVENTURE GLOBAL TOUR LLP AND ALSO PRODUCED THE CASH BOOK OF THE SAID CONCERN TO SHOW THE AVAILABILITY OF CASH WITH THE SAID LLP. ONCE THERE IS NO INCRIMINATING MATERIAL TO SHOW THAT THE CASH OF RS. 2,59,140/- FOUND AT 203 RATNA SAGAR, MSB KA RASTA, JOHARI BAZAR BELONGS TO THE AS SESSEE AND THE SAID PREMISES WAS NOT THE BUSINESS PREMISES OF THE ASSESSEE AND T HE ASSESSEE HAS EXPLAINED THE SOURCE OF CASH BELONGS TO M/S. ADVENTURE GLOBAL TOU R LLP WHOSE BUSINESS PREMISES IS SITUATED AT 203 RATNA SAGAR, MSB KA RASTA, JOHAR I BAZAR, THEN IN THE ABSENCE OF ANY CONTRARY FACT OR MATERIAL, THE SAID EXPLANATION OF THE ASSESSEE CANNOT BE BRUSHED ASIDE. ACCORDINGLY, IN THE FACTS AND CIRC UMSTANCES OF THE CASE, WE ARE OF THE CONSIDERED VIEW THAT THE ASSESSEE HAS DISCHARGE D ITS ONUS IN EXPLAINING THE SOURCE OF CASH AND THE AO EVEN FAILED TO DISCHARGE HIS PRELIMINARY ONUS TO ESTABLISH THAT THE CASH FOUND AT A DIFFERENT PREMISES NOT BEL ONGING TO THE ASSESSEE, BELONGS TO THE ASSESSEE. THUS THE ADDITION MADE BY THE AO IS DELETED. 6. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED . ORDER PRONOUNCED IN THE OPEN COURT ON 02/09/2019. SD/- SD/- FOE FLAG ;KNO FOT; IKY JKWO (VIKRAM SINGH YADAV) (VIJAY PAL RAO) YS[KK LNL;@ ACCOUNTANT MEMBER U;KF;D LNL;@ JUDICIAL MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 02/09/2019. DAS/ 6 ITA NO. 1493/JP/2018 M/S. JAI AMARNATH ASSOCIATES, JAIPUR. VKNS'K DH IZFRFYFI VXZSFKR@ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ@ THE APPELLANT- M/S. JAI AMARNATH ASSOCIATES, JAIPUR . 2. IZR;FKHZ@ THE RESPONDENT-THE DCIT, CENTRAL CIRCLE-3, JAIPUR. 3. VK;DJ VK;QDR@ CIT 4. VK;DJ VK;QDR@ CIT(A) 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ@ DR, ITAT, JAIPUR 6. XKMZ QKBZY@ GUARD FILE {ITA NO. 1493/JP/2018} VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ@ ASST. REGISTRAR