Moreshwar Mahadev Bhondve, Pune V. ACIT, Pune

ITA 1504/PUN/2012

• Counselvise Citation: 150424514 RSA 2012
• Duration Of Justice: 1 year(s) 10 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-05-2014
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 12-11-2013
• Assessment Year: 2009-2010
• Appeal Filed On: 06-07-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S P WALIMBE
• Keywords: Gift; Business income; Depreciation; Income from undisclosed sources; Search and seizure; Opportunity of being heard; Principle of natural justice; Source of fund; Corroborative evidences; Retraction; Documents seized
• Section: 153A; 132

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH B, PUNE BEFORE SHRI SHAILENDRA KUMAR YADAV, JUDICIAL MEMBER, AND SHRI R.K. PANDA, ACCOUNTANT MEMBER ITA NOS.2191 TO 2193 & 1502 TO 1504/PN/2012 (A.YS: 2004-05 TO 2009-10) MORESHWAR MAHDEV BHONDVE A/P RAVET, TAL HAVELI PUNE - 412010 PAN: AAJPB8648Q APPELLANT VS. ACIT, CENTRAL CIRCLE 1(2), PUNE RESPONDENT ASSESSEE BY : SHRI KISHORE PHADKE DEPARTMENT BY : SHRI S.P. W ALIMBE DATE OF HEARING : 20.05.2014 DATE OF ORDER : 27.05.2014 ORDER PER SHAILENDRA KUMAR YADAV, J.M: ALL THESE APPEALS PERTAIN TO THE SAME ASSESSEE ON SIMILAR ISSUES FOR DIFFERENT ASSESSMENT YEARS, SO THEY ARE BEING D ISPOSED OFF BY THIS COMMON ORDER. 2. IN ITA NO.2191/PN/2012 FOR A.Y. 2004-05, THE ASS ESSEE HAS FILED THE APPEAL ON THE FOLLOWING GROUNDS. 1. THE LEARNED CIT (A)-I, PUNE HAS ERRED IN LAW AND ON FACTS IN CONFIRMING THE ADDITION MADE BY LEARNED AO RS.1,73, 000/- AS AGAINST RETURNED INCOME OF 'NIL'. 2. THE LEARNED CIT(A)-I HAS ERRED IN LAW AND FACTS IN CONFIRMING THE ADDITION MADE BY LEARNED AO ONLY ON THE BASIS O F DECLARATION MADE DURING THE COURSE OF SEARCH WITHOU T APPRECIATING FACT THAT THE SAID DECLARATION HAS BEE N RETRACTED BY THE APPELLANT. 2 3. THE LEARNED CIT(A)-I HAS ERRED IN LAW AND FACTS IN CONFIRMING THE ADDITION MADE BY LEARNED AO HOLDING THE INVESTM ENT IN LAND OF RS.173,000/- HAS BEEN MADE OUT UNDISCLOSED SOURCES OF INCOME. 4. ALTERNATIVELY AND WITHOUT PREJUDICE TO THE GROUND O F 1 TO 3, THE LEARNED CIT(A)-I, PUNE HAS ERRED IN LAW AND FAC TS NOT APPRECIATING THE FACT THAT THE AO DID NOT ALLOW TH E DEDUCTIONS CLAIMED FOR VARIOUS EXPENDITURES, INCLUDING LAND CO ST, DEPRECIATION ON CARS, WHILE COMPUTING THE TAXABLE I NCOME.' 5. ALTERNATIVELY AND WITHOUT PREJUDICE TO THE GROUND O F 1, 2 & 3 THE LEARNED CIT(A)-I, PUNE HAS ERRED IN LAW AND FAC TS IN NOT GIVING EFFECT OF TELESCOPING FOR THE INCOME DECLARE D DURING THE COURSE OF SEARCH. 6. THE APPELLANT CRAVES LEAVE TO ADD / DELETE / AMEND / MODIFY ALL / ANY OF THE GROUNDS. 2.1 IN ITA NO.2192/PN/2012 FOR A.Y. 2005-06, THE AS SESSEE HAS FILED THE APPEAL ON THE FOLLOWING GROUNDS. 1. THE LEARNED CIT (A)-I, PUNE HAS ERRED IN LAW AND ON FACTS IN CONFIRMING THE ADDITION MADE BY LEARNED AO RS.4,65, 000/- AS AGAINST RETURNED INCOME OF 'NIL'. 2. THE LEARNED CIT(A)-I HAS ERRED IN LAW AND FACTS IN CONFIRMING THE ADDITION MADE BY LEARNED AO ONLY ON THE BASIS O F DECLARATION MADE DURING THE COURSE OF SEARCH WITHOU T APPRECIATING FACT THAT THE SAID DECLARATION HAS BEE N RETRACTED BY THE APPELLANT. 3. ALTERNATIVELY AND WITHOUT PREJUDICE TO THE GROUND O F 1 & 2, THE LEARNED CIT(A)-I, PUNE HAS ERRED IN LAW AND FAC TS IN NOT GIVING EFFECT OF TELESCOPING FOR THE INCOME DECLARE D DURING THE COURSE OF SEARCH. 4. ALTERNATIVELY AND WITHOUT PREJUDICE TO THE GROUND O F 1 TO 3, THE LEARNED CIT(A)-I, PUNE HAS ERRED IN LAW AND FAC TS NOT APPRECIATING THE FACT THAT THE AO DID NOT ALLOW TH E DEDUCTIONS CLAIMED FOR VARIOUS EXPENDITURES, INCLUDING LAND CO ST, DEPRECIATION ON CARS, WHILE COMPUTING THE TAXABLE I NCOME.' 5. THE APPELLANT CRAVES LEAVE TO ADD / DELETE / AMEND / MODIFY ALL / ANY OF THE GROUNDS. 2.2 IN ITA NO.2193/PN/2012 FOR A.Y. 2006-07, THE AS SESSEE HAS FILED THE APPEAL ON THE FOLLOWING GROUNDS. 3 1. THE LEARNED CIT (A)-I, PUNE HAS ERRED IN LAW AND ON FACTS IN CONFIRMING THE ADDITION MADE BY LEARNED AO RS.1,86, 632/- AS AGAINST RETURNED LOSS OF RS.1,63,368/-. 2. THE LEARNED CIT(A)-I HAS ERRED IN LAW AND FACTS IN CONFIRMING THE ADDITION MADE BY LEARNED AO ONLY ON THE BASIS O F DECLARATION MADE DURING THE COURSE OF SEARCH WITHOU T APPRECIATING FACT THAT THE SAID DECLARATION HAS BEE N RETRACTED BY THE APPELLANT. 3. ALTERNATIVELY AND WITHOUT PREJUDICE TO THE GROUND O F 1 & 2, THE LEARNED CIT(A)-I, PUNE HAS ERRED IN LAW AND FAC TS IN NOT GIVING EFFECT OF TELESCOPING FOR THE INCOME DECLARE D DURING THE COURSE OF SEARCH. 4. ALTERNATIVELY AND WITHOUT PREJUDICE TO THE GROUND O F 1 TO 3, THE LEARNED CIT(A)-I, PUNE HAS ERRED IN LAW AND FAC TS NOT APPRECIATING THE FACT THAT THE AO DID NOT ALLOW TH E DEDUCTIONS CLAIMED FOR VARIOUS EXPENDITURES, INCLUDING LAND CO ST, DEPRECIATION ON CARS, WHILE COMPUTING THE TAXABLE I NCOME.' 5. THE APPELLANT CRAVES LEAVE TO ADD / DELETE / AMEND / MODIFY ALL / ANY OF THE GROUNDS. 2.3 IN ITA NO.1502/PN/2012 FOR A.Y. 2007-08, THE AS SESSEE HAS FILED THE APPEAL ON THE FOLLOWING GROUNDS. 1. THE LEARNED CIT (A)-I, PUNE HAS ERRED IN LAW AND ON FACTS IN CONFIRMING THE ADDITION MADE BY LEARNED AO RS.60,85 ,737/- AS AGAINST RETURNED INCOME OF RS.5,65,997/-. 2. THE LEARNED CIT(A)-I HAS ERRED IN LAW AND FACTS IN CONFIRMING THE ADDITION MADE BY LEARNED AO ONLY ON THE BASIS O F DECLARATION MADE DURING THE COURSE OF SEARCH WITHOU T APPRECIATING FACT THAT THE SAID DECLARATION HAS BEE N RETRACTED BY THE APPELLANT. 3. ALTERNATIVELY AND WITHOUT PREJUDICE TO THE GROUND O F 1 & 2, THE LEARNED CIT(A)-I, PUNE HAS ERRED IN LAW AND FAC TS IN NOT GIVING EFFECT OF TELESCOPING FOR THE INCOME DECLARE D DURING THE COURSE OF SEARCH. 4. ALTERNATIVELY AND WITHOUT PREJUDICE TO THE GROUND O F 1 TO 3, THE LEARNED CIT(A)-I, PUNE HAS ERRED IN LAW AND FAC TS NOT APPRECIATING THE FACT THAT THE AO DID NOT ALLOW TH E DEDUCTIONS CLAIMED FOR VARIOUS EXPENDITURES, INCLUDING LAND CO ST, DEPRECIATION ON CARS, WHILE COMPUTING THE TAXABLE I NCOME.' 5. THE APPELLANT CRAVES LEAVE TO ADD / DELETE / AMEND / MODIFY ALL / ANY OF THE GROUNDS. 4 2.4 IN ITA NO.1503/PN/2012 FOR A.Y. 2008-09, THE AS SESSEE HAS FILED THE APPEAL ON THE FOLLOWING GROUNDS. 1. THE LEARNED CIT (A)-I, PUNE HAS ERRED IN LAW AND ON FACTS IN CONFIRMING THE ADDITION MADE BY LEARNED AO RS.68,95 ,430/- AS AGAINST RETURNED INCOME OF RS.25,88,485/-. 2. THE LEARNED CIT(A)-I HAS ERRED IN LAW AND FACTS IN CONFIRMING THE ADDITION MADE BY LEARNED AO ONLY ON THE BASIS O F DECLARATION MADE DURING THE COURSE OF SEARCH WITHOU T APPRECIATING FACT THAT THE SAID DECLARATION HAS BEE N RETRACTED BY THE APPELLANT. 3. ALTERNATIVELY AND WITHOUT PREJUDICE TO THE GROUND O F 1 & 2, THE LEARNED CIT(A)-I, PUNE HAS ERRED IN LAW AND FAC TS IN NOT GIVING EFFECT OF TELESCOPING FOR THE INCOME DECLARE D DURING THE COURSE OF SEARCH. 4. ALTERNATIVELY AND WITHOUT PREJUDICE TO THE GROUND O F 1 TO 3, THE LEARNED CIT(A)-I, PUNE HAS ERRED IN LAW AND FAC TS NOT APPRECIATING THE FACT THAT THE AO DID NOT ALLOW TH E DEDUCTIONS CLAIMED FOR VARIOUS EXPENDITURES, INCLUDING LAND CO ST, DEPRECIATION ON CARS, WHILE COMPUTING THE TAXABLE I NCOME.' 5. THE APPELLANT CRAVES LEAVE TO ADD / DELETE / AMEND / MODIFY ALL / ANY OF THE GROUNDS. 2.5 IN ITA NO.1504/PN/2012 FOR A.Y. 2009-10, THE AS SESSEE HAS FILED THE APPEAL ON THE FOLLOWING GROUNDS. 1. THE LEARNED CIT (A)-I, PUNE HAS ERRED IN LAW AND ON FACTS IN CONFIRMING THE ADDITION MADE BY LEARNED AO RS.1,70, 96,830/- AS AGAINST RETURNED LOSS OF RS.119,431/-. 2. THE LEARNED CIT(A)-I HAS ERRED IN LAW AND FACTS IN CONFIRMING THE ADDITION MADE BY LEARNED AO ONLY ON THE BASIS O F DECLARATION MADE DURING THE COURSE OF SEARCH WITHOU T APPRECIATING FACT THAT THE SAID DECLARATION HAS BEE N RETRACTED BY THE APPELLANT. 3. THE LEARNED CIT(A)-I HAS ERRED IN LAW AND FACTS IN CONFIRMING THE ADDITION ADDING THE SUM OF RS. 1.35 CRORES AS THE UNDISCLOSED INCOME OF THE ASSESSEE IN DEAL OF SONIG ARA, IGNORING THE FACT THAT THE SAME IS NOT ACTUALLY RECEIVED BY THE ASSESSEE. 4. ALTERNATIVELY AND WITHOUT PREJUDICE TO THE GROUND O F 1 TO 3 THE LEARNED CIT(A)-I, PUNE HAS ERRED IN LAW AND FAC TS IN NOT APPRECIATING THE FACT THAT ON THE BASIS OF SEIZED D OCUMENTS THE 5 ADDITION OUGHT TO HAVE BEEN RS.32,50,000/- IN SONIG ARA DEAL INSTEAD OF RS. 1,35,00,000/-. 5. THE LEARNED CIT(A)-I, PUNE HAS ERRED IN LAW AND FAC TS IN CONFIRMING THE ADDITION MADE BY LEARNED IN CASE OF SONIGARA DEAL WITHOUT CONSIDERING THE AFFIDAVITS FILED B Y THE ASSESSEE AND WITHOUT AFFORDING CROSS EXAMINATION OF MR. SONIGARA TO THE ASSESSEE. 6. THE LEARNED CIT(A)-I, , PUNE HAS ERRED IN LAW AND F ACTS IN CONFIRMING THE ADDITION MADE BY LEARNED AO AMOUNTIN G RS. 15 LAKHS AS UNDISCLOSED INVESTMENT OF THE ASSESSEE WIT HOUT GIVING TELESCOPING EFFECT OF THE SAID AMOUNT RECEIVED ON S ALE LEXUS CAR TO MR.CHACHALANI. FURTHER, THE LEARNED CIT(A)-I HAS ERRED IN LAW AND FACTS IN NOT CONSIDERING THE CONFIRMATION F ILED BY THE MR. CHACHALNI REGARDING THE SAME. 7. ALTERNATIVELY AND WITHOUT PREJUDICE TO THE GROUND O F 1 TO 6, THE LEARNED CIT(A)-I, PUNE HAS ERRED IN LAW AND FAC TS IN NOT GIVING EFFECT OF TELESCOPING FOR THE INCOME DECLARE D DURING THE COURSE OF SEARCH. 8. ALTERNATIVELY AND WITHOUT PREJUDICE TO THE GROUND O F 1 TO 7, THE LEARNED CIT(A)-I, PUNE HAS ERRED IN LAW AND FAC TS IN NOT APPRECIATING THE FACT THAT THE AO DID NOT ALLOW THE DEDUCTIONS CLAIMED FOR VARIOUS EXPENDITURES, INCLUDING LAND CO ST, DEPRECIATION ON CARS, WHILE COMPUTING THE TAXABLE I NCOME.' 9. ALTERNATIVELY AND WITHOUT PREJUDICE TO THE GROUND O F 1 TO 8, THE LEARNED CIT(A)-I, PUNE HAS ERRED IN LAW AND FAC TS IN NOT GIVING EFFECT OF RELIEF PROVIDED OF RS.88,000/- WHI LE ADJUDICATING IN THE FINAL ORDER AND ASSESSING INCOME RS 1,70,96, 830/- INSTEAD OF 1,70,08,830/-. 10. THE APPELLANT CRAVES LEAVE TO ADD / DELETE / AM END / MODIFY ALL / ANY OF THE GROUNDS. 3. THE ASSESSEE IS AN INDIVIDUAL RESIDENT OF RAVET, TALUKA HAVELI, DIST PUNE, ENGAGED IN LAND TRANSACTIONS IN PIMPRI CHINCHWAD AREA OF PUNE. A SEARCH AND SEIZURE ACTION WAS CARRIED O UT AT HIS PREMISES ON 13.08.2008 AND NUMEROUS INCRIMINATING DOCUMENTS SHOWING EVASION OF TAX WERE FOUND BY THE CONCERNED REVENUE AUTHORITIES. THE SEARCH REVEALED THAT THE ASSESSEE HAS NOT BEEN FILI NG ITS RETURN OF INCOME AT ALL. EVEN BOOKS OF ACCOUNTS WERE FOUND T O BE NOT MAINTAINED IN ANY MANNER BY HIM. ACCORDING TO REVE NUE AUTHORITIES, THE ASSESSEE WAS FOUND TO HAVE MADE HUGE PROFITS FR OM LAND DEALS 6 AND WAS CLAIMED TO HAVE BEEN MAINTAINING AN EXTRAVA GANT LIFE STYLE. HE ALSO ADMITTED THOUGH SUBSEQUENTLY RETRACTED TO H AVE GIVEN DONATIONS AND CONTRIBUTIONS OF MORE THAN 20 LACS EACH TOTALING TO 40 LACS, ETC. ON THE BASIS OF THESE FINDINGS, LOOS E PAPERS AND ASSETS FOUND AND SEIZED ALONG WITH THE BANK ACCOUNTS, STAT EMENT OF OATH U/S.132(4) WAS RECORDED. THE STATEMENT OF ASSESSEE ON VARIOUS DOCUMENTS AND ASSETS FOUND WAS RECORDED. THE QUEST IONS IN RESPECT OF HIS INVESTMENT AND EXPENSES WERE ALSO ASKED. IT WAS FOUND THAT THE ASSESSEE HAD MADE SUBSTANTIAL EXPENSES AND INVE STMENTS AND LAND DEAL BUSINESS. THE STATEMENT ON OATH OF OTHER CONNECTED PERSONS SHRI SANJAY SONIGARA, SHRI SUBHASH KANTILAL SONIGARA, ETC. WERE ALSO RECORDED IN CONNECTION WITH LAND TRANSACT IONS REVEALED BY THE SEIZED MATERIAL OR THE STATEMENT OF THE ASSESSE E AND OTHERS. ACCORDING TO REVENUE AUTHORITIES, THE ASSESSEE IN H IS STATEMENT OF OATH RECORDED U/S.132(4) ON 13.08.2008 ADMITTED TO HAVE UNDISCLOSED INCOME OF 2 CRORES APPROXIMATELY FOR BLOCK PERIOD FOR DIFFERENT ASSESSMENT YEARS AS UNDER: SR. NO. AS STT. YEAR UNDISCLOSED INCOME DECLARE D 1 2005 - 06 RS.4.65 LAKHS 2 2006 - 07 RS.4.5 LAKHS 3 2007 - 08 RS.63.60 LAKHS 4 2008 - 09 RS.105 LAKHS 5 2009 - 10 RS.22.25 LAKHS TOTAL RS. 200 LAKHS 3.1 IT WAS FURTHER NOTED FROM THE MATERIALS AVAILAB LE THAT THE ASSESSEE IN HIS STATEMENT RECORDED U/S 132(4) ON 13 .8.2008, HAS FURTHER STATED THAT THE DEPOSITS APPEARING IN THE B ANK TOTALING TO 1,47,20,808/- EVIDENCED THE CASH RECEIVED IN SONIGA RA LAND DEAL OF 32,50,000/- AND AMOUNT RECEIVED FROM THE SALE OF LE XUS CAR OF 15 LAKHS WERE TAXABLE AS UNDISCLOSED INCOME. THE ASSE SSING OFFICER ALSO NOTED THAT THE ASSESSEE ON 14.08.2008 U/S 132( 4), IN RESPONSE TO QUESTION NO.2 AND 5 ADMITTED TO HAVE RECEIVED CO MMISSION OF 6,93,000/- ALSO FROM CERTAIN LAND DEALS. THEREFORE , THE ASSESSING OFFICER OBSERVED THAT THE ASSESSEE HAS ADMITTED TO HAVE UNDISCLOSED 7 TAXABLE INCOME OF 2 CRORES FOR ASSESSMENT YEARS AS DETAILED ABOVE. AS STATED ABOVE, THE ASSESSEE HAS FURTHER ADMITTED AN UNDISCLOSED INCOME OF 6,93,000/- IN THE STATEMENT RECORDED U/S.132(4) ON THE NEXT DATE I.E. 14.08.2008. THUS, TOTAL INCOME DECL ARED BY THE ASSESSEE WAS 2,01,63,808/-. 3.2 IN RESPONSE TO NOTICE U/S 143(2), THE ASSESSEE FILED RETURN OF INCOME U/S.153A ON 12.10.2010 I.E. ALMOST AFTER 8 M ONTHS OF NOTICE ISSUED BY THE ASSESSING OFFICER ON 11.02.2010. THE ASSESSING OFFICER NOTED FROM THE RETURN FILED BY THE ASSESSEE THAT THE ASSESSEE HAS NOT FILED RETURN AS ADMITTED U/S.132(4) DURING SEARCH. THE INCOME DECLARED BY THE ASSESSEE U/S.153A VIS--VIS THE DISCLOSURE MADE, AS NOTED ABOVE ARE AS UNDER: SR. NO. ASSTT. YEAR UNDISCLOSED INCOME DECLARED U/S.132(4) INCOME SHOWN IN THE RETURN U/S 153A 1 200 3 - 0 4 --- --- 2 2004 - 05 --- RS. NIL 3 2005 - 06 RS. 4.65 LAKHS RS.NIL 4 2006 - 07 RS.4.5 LAKHS RS.NIL 5 2007 - 08 RS.63.60 LAKHS RS.5,66,000 6 2008 - 09 RS.105 LAKHS RS. 25,88,485 7 2009 - 10 RS. 22.25 LAKHS RS.NIL TOTAL RS.200 LAKHS RS. 31,5 4,485 3.3 THE ASSESSING OFFICER OBSERVED THAT THE ASSESSE E HAS NOT DISCLOSED EVEN THE UNDISCLOSED INCOME WHICH WAS ADM ITTED U/S 132(4), SO THE ASSESSEE WAS ASKED BY SHOW CAUSE NOT ICE TO EXPLAIN THE SITUATION. IN RESPONSE TO THE SAME, IT WAS CON TENDED ON BEHALF OF ASSESSEE BEFORE THE ASSESSING OFFICER THAT THE DISC LOSURE WAS BASED ON FIGURES WORKED OUT BY SEARCH PARTY AND THEREFORE , IT WAS NOT ACCEPTABLE TO THE ASSESSEE. IT WAS CONTENDED BEFOR E THE ASSESSING OFFICER THAT THE ASSESSEE IS AN AGRICULTURIST AND H AD NO KNOWLEDGE OF INCOME TAX LAW AND OTHER PROCEDURE. THE INCOME HAD BEEN WORKED OUT AFTER SEARCH FOR AYS.2003-04 TO 2009-10 AND RET URNS ACCORDINGLY HAVE BEEN PREPARED AND FILED. THE ASSESSING OFFICE R NOTED THAT THE ASSESSEE HAS DECIDED TO RETRACT THE ASSESSMENT WITH OUT BRINGING ANY RELEVANT MATERIALS FOR ITS CAUSE AFTER A GAP OF MOR E THAN TWO YEARS. 8 THE ASSESSING OFFICER HAS DISCUSSED THIS ISSUE IN D ETAIL IN ASSESSMENT ORDER AND HAS HELD THAT THE RETRACTION A FTER A GAP OF 28 MONTHS CANNOT BE ACCEPTED WITHOUT BRINGING ON RECOR D ANY MATERIALS WHICH COULD SHOW THAT THE DECLARANT ASSESSEE WAS SU BJECTED TO ANY THREAT OR COERCION OR INDUCEMENT FOR GIVING THE SAM E. THE ONUS IS ON THE ASSESSEE / DECLARANT TO ESTABLISH THAT THE DECL ARATION WAS NOT GENUINE AND UNDER MISCONCEPTION OF FACT. THE ASSES SING OFFICER WAS OF THE VIEW THAT RETRACTION CANNOT ADMITTED. THE A SSESSING OFFICER AFTER CONSIDERING THE RECONCILIATION HAS GIVEN FIND ING THAT CREDIT SHOWN IN THE BANKS TAKEN IN THE BOOKS OF ACCOUNTS C ONSTRUCTED BY THE ASSESSEE AFTER SEARCH ON THE BASIS OF MATERIAL FOUND AND THE STAND TAKEN BY THE ASSESSEE IS CORRECT. 3.4 THE ASSESSING OFFICER HAS ALSO STATED IN THE A SSESSMENT ORDER THAT THE AGRICULTURAL RECEIPTS AND BUSINESS RECEIPT S AS PER STAND OF THE ASSESSEE HAS BEEN NOTED IN THE CONSTRUCTED BOOK S. HOWEVER, THE ASSESSING OFFICER HAS NOT FOUND RECONSTRUCTED BOOKS TO BE RELIABLE ENOUGH WHICH COULD FORM THE BASIS OF RETRACTION OF DECLARATION MADE U/S.132(4). THEREFORE, WHEREVER DECLARATION WAS MO RE THAN AMOUNT APPEARING IN THE BOOKS OR OTHERWISE, THE ASSESSING OFFICER STUCK TO THE FIGURE OF DECLARATION. IN CERTAIN YEARS, THE A SSESSING OFFICER HAS ALSO ALLOWED CERTAIN EXPENSES WHICH WERE FOUND TO B E GENUINE AND ALLOWABLE ON THE BASIS OF THIRD PARTY EVIDENCE AVAI LABLE ON RECORD. HOWEVER, THE ASSESSING OFFICER HAS NOT ALLOWED ANY FURTHER EXPENSES COMMISSION, SALARY, ETC. ON ASSUMPTION BASIS AS THE BASIS OF INCOME ITSELF IS BASED ON EVIDENCES ONLY, INCLUDING ORAL A ND IS CLEARLY ON NET BASIS. FURTHER, THE ADDITIONS OVER AND ABOVE DECLA RED INCOME U/S. 132(4) BASED ON MATERIALS GATHERED BY HIM DURING AS SESSMENT AND OTHER SEIZED MATERIALS NOT CONSIDERED WHILE GIVING STATEMENTS U/S.132(4) FOR MAKING DECLARATION OF UNDISCLOSED IN COME OF 2 CRORES AS DESCRIBED ABOVE AND ALSO THE DETAILS FILE D BY THE ASSESSEE WHILE FILING RETURNS U/S.153A WERE MADE MAINLY IN A .Y. 2009-10. THE ASSESSING OFFICER HAS ALSO CONSIDERED THE UNDIS CLOSED HOUSEHOLD EXPENSES IN THE LIGHT OF THE DECLARATION MADE U/S 1 32(4) ON 9 13.08.2008 WHEREIN THE ASSESSEE HAS ADMITTED HOUSEH OLD EXPENSES OF 20 LAKHS, DONATIONS (DENAGI) OF 20 LAKHS AND CONTRIBUTIONS (VARGANI) OF 20,47,000/- TO VARIOUS CLUBS AND MANDALS ETC. THE YEAR WISE BIFURCATIONS WERE NOT GIVEN TO THE ASSESS ING OFFICER DURING ASSESSMENT. THEY WERE ALSO NOT CONSIDERED IN THE RE CONCILIATION OR RETURNS. INSTEAD, THE ASSESSEE DENIED TO HAVE MADE ANY SUCH EXPENDITURE DURING THE COURSE OF ASSESSMENT IN RESP ONSE TO THE QUESTION ISSUED DURING ASSESSMENT AND REPLY GIVEN V IDE LETTER DATED 16.11.2010. THE ASSESSING OFFICER HAS HELD THE DE CLARATION AS VALID AND CONCLUDED THAT THE ASSESSEE IS INCORRECTLY TRYI NG TO ESCAPE FROM THE FACTS FOUND DURING SEARCH. NO SEPARATE ADDITI ON HAS BEEN MADE BY THE ASSESSING OFFICER FOR THIS EXPENDITURE AS AP PARENTLY HE WAS OF THE OPINION THAT THESE EXPENSES WERE MET OUT OF UND ISCLOSED INCOME ASSESSED IN THE HANDS OF THE ASSESSEE. SIMILARLY T HE ASSESSING OFFICER HAS NOT MADE ANY ADDITION FOR INVESTMENT IN HOUSE PROPERTY, WHICH WAS ADMITTED BY ASSESSEE AT 20 LAKHS APPROXIMATELY FOR SIMILAR REASONS. THUS, THE ASSESSING OFFICER HAS ALLOWED THE TELESCOPIC BENEFIT TO THE ASSESSEE IN RESPECT OF UN DISCLOSED HOUSEHOLD EXPENSES, DENAGI AND VARGANI OF MORE THAN 60 LAKHS FOUND DURING SEARCH AND ALSO INVESTMENT IN HOUSE OF APPROXIMATEL Y 20 LAKHS. 3.5 FINALLY, THE ASSESSING OFFICER AFTER CONSIDERI NG ENTIRE FACTS AND CIRCUMSTANCES OF THE CASE, COMPUTED TOTAL INCOME OF ASSESSEE FOR DIFFERENT ASSESSMENT YEARS ON THE BASIS OF DECLARAT ION MADE AND CERTAIN OTHER DOCUMENTS SEIZED, DETAILS OF INVESTME NT AND EXPENSES FOUND AFTER GIVING TELESCOPIC EFFECT WHEREVER POSSI BLE IN THE FOLLOWING MANNER. THE FOLLOWING TABLE SHOWS THE DECLARATION OF UNDISCLOSED INCOME, RETURN OF INCOME AND ASSESSED INCOME FOR DI FFERENT ASSESSMENT YEARS INVOLVED IN THE BLOCK DETAILED AS UNDER: SR. NO. ASSTT. YEAR UNDISCLOSED INCOME DECLARED U/S.132(4) INCOME SHOWN IN THE RETURN U/S 153A ASSESSED INCOME 1 2003 - 04 --- RS.NI L NO APPEAL FILED BY ASSESSEE 2 2004 - 05 --- RS.NIL RS.1,73,000 10 3 2005 - 0 6 RS.4.65 LAKHS RS.NIL RS.4,65,000 4 2006 - 07 RS.4.5 LAKHS RS.NIL RS.1,86,632 5 2007 - 08 RS.63.60 LAKHS RS.5,66,000 RS. 60,85,737 6 2008 - 09 RS.105 LAKHS RS.25,88,485 RS.68,95,430 7 2009 - 10 RS.22.25 LAKHS RS.NIL RS. 1,70,96,830 TOTAL RS.200 LAKHS RS.31,54 ,485 RS.3,09,02,629 3.6 THE YEAR-WISE CASES WAS DISCUSSED IN THE APPEAL AND HAVING DISCUSSED IN DETAIL, THE CIT(A) PARTLY ALLOWED THE APPEAL OF THE ASSESSEE FOR A.Y. 2007-08 & 2009-10 AND FOR A.Y. 20 08-09 WAS DISMISSED. FOR A.Y. 2004-05 TO 2006-07, THE APPEAL S OF ASSESSEE WERE DISMISSED. BEFORE US, THE LEARNED AUTHORIZED REPRESENTATIVE HAS REITERATED THE SUBMISSION MADE BEFORE AUTHORITI ES AND SUBMITTED THAT THE CIT(A) ERRED IN LAW IN CONFIRMING THE ADDI TIONS MADE BY THE ASSESSING OFFICER AGAINST THE RETURN OF INCOME. TH E CIT(A) ERRED IN CONFIRMING ADDITION ONLY ON THE BASIS OF DECLARATIO N MADE DURING THE COURSE OF SEARCH WITHOUT APPRECIATING THE FACT THAT THE SAID DECLARATION HAS BEEN RETRACTED BY THE ASSESSEE. A SIMILAR GROUND HAS BEEN TAKEN BY THE ASSESSEE IN ALL THE YEARS AND REQUESTED TO DELETE THE ADDITIONS IN QUESTION. ON THE OTHER HAN D, THE LEARNED DEPARTMENTAL REPRESENTATIVE HAS RAISED VARIOUS CONT ENTIONS TO SUPPORT THE ORDER OF CIT(A) IN ALL THE ABOVE YEARS. 4. WE FIND THAT THE ASSESSEE IS AN INDIVIDUAL RESID ENT OF RAVET, TALUKA HAVELI, DIST PUNE ALSO ENGAGED IN LAND T RANSACTIONS IN PIMPRI CHINCHWAD AREA OF PUNE. A SEARCH U/S. 132 W AS CONDUCTED ON ASSESSEES PREMISES ON 13.08.2008 AND SOME DOCUM ENTS WERE SEIZED AND THE STATEMENT OF ASSESSEE U/S.132(4) WAS RECORDED. IT IS UNDISPUTED THAT PRIOR TO THE SEARCH, THE ASSESSEE H AD NOT FILED RETURN OF INCOME, EVEN THE BOOKS OF ACCOUNTS WERE N OT AVAILABLE SINCE NOT MAINTAINED TILL THEN. IN THIS REGARD, TH E STAND OF THE ASSESSEE HAS BEEN THAT HE WAS FROM AGRICULTURIST BA CKGROUND AND HAS SIZEABLE AGRICULTURAL INCOME, WHERE FROM THE OT HER ACTIVITIES OF LAND DEALING, COMMISSION ACTIVITY WERE STARTED. CO NSIDERING THE PAPERS SEIZED DURING SEARCH AND SINCE THE BOOKS OF ACCOUNTS WERE NOT PREPARED BY THE ASSESSEE, SUMMARY OF BOOKS AND OTHER TRANSACTIONS WERE PREPARED BY INVESTIGATING TEAM. WHEN THE 11 ASSESSEE WAS QUESTIONED ON THE BASIS OF SAID SUMMAR Y, THE ASSESSEE MADE DECLARATION OF 2 CRORES AS DISCUSSED ABOVE. IN SHORT DECLARATION DURING SEARCH WAS BASED ON THE FOLLOWIN G ACCOUNTS: A) SUMMATIONS OF CREDITS IN THE BANK ACCOUNTS - 1,52,50,000 B) INCOME FROM SALE OF LEXUS CAR - 15,00,000 C) ENTRY APPEARING IN A SEIZED DOCUMENT - 32,50,000 4.1 REGARDING RETRACTION OF ADMISSION, THE STAND OF THE ASSESSEE HAS BEEN THAT HE PREPARED THE BOOKS OF ACCOUNTS, BA SED ON BANK TRANSACTIONS, PROPERTY DEALS, EXPENSES, CARS ACQUIS ITION TRANSACTIONS, ETC. THE AGRICULTURAL INCOME ENTRIES WERE ALSO ENT ERED IN THE RELEVANT BOOKS OF ACCOUNTS. BASED ON THESE BOOKS, FINAL ACC OUNTS WERE PREPARED. COMPUTATION OF INCOME WAS PREPARED FROM PROFIT & LOSS AND RETURN WAS FILED. ACCORDING TO THE ASSESSEE, T HIS PROCESS TOOK A VERY LONG PERIOD. IN THE SAID PROCESS OF MAKING AC COUNTS, THE ASSESSEE REALIZED THAT AN ERRONEOUS ADMISSION HAS B EEN MADE BY HIM, SO THE ASSESSEE HAS DECIDED TO RETRACT THE ADM ISSION. THE ASSESSEE CLAIMS TO HAVE RETRACTED FROM INCORRECT AD MISSION OF INCOME. 4.2 THE LEARNED AUTHORIZED REPRESENTATIVE HAS SUBMI TTED THAT DURING ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICE R CHECKED THE BOOKS OF ACCOUNTS, BANK STATEMENTS, SUBMISSION OF A SSESSEE. THE ASSESSING OFFICER HAS ALSO VERIFIED THE EXISTENCE O F AGRICULTURAL INCOME, ADEQUACY OF BUSINESS INCOME, EXPENSE DETAIL S, ETC. THE ASSESSING OFFICER HAS ALSO VERIFIED THE TRANSACTION S WITH MR. SONIGRA FOR RAWET LAND. THE STATEMENT OF SAID SONIGRA WAS ALSO RECORDED. BASED ON THESE ENQUIRIES, THE ASSESSING OFFICER FIN ALIZED THE ASSESSMENT. THE LEARNED AUTHORIZED REPRESENTATIVE HAS POINTED OUT THAT THE ASSESSING OFFICER EVEN AFTER ACCEPTING THE WRONG DECLARATION OF INCOME DUE TO WRONG CREDITS, SUMMATIONS IN BANK STATEMENT, PREFERRED TO MAKE FURTHER ADDITION. THE INCOME COM PUTED BY THE ASSESSING OFFICER HAS BEEN SUMMARIZED WHICH IS DETA ILED IN PARA 3.5 OF THIS ORDER. 12 4.3 THE CIT(A) CONFIRMED ALL ADDITIONS MADE BY THE ASSESSING OFFICER EXCEPT FOR CASH BALANCE OF 88,000/- IN A.Y. 2009-10. WHILE DOING SO, THE CIT(A) HAS CONFIRMED THE STAND OF THE ASSESSING OFFICER THAT THE INCOME DECLARED IN SEARCH SHOULD BE TAXABL E INCOME OF ASSESSEE, SUBJECTED TO FURTHER ADDITION / REDUCTION . 4.4 WITH REGARD TO JUSTIFICATION OF RETRACTION, THE STAND OF THE ASSESSEE HAS BEEN MANIFOLD. THE LEARNED AUTHORIZED REPRESENTATIVE HAS SUBMITTED THAT A MISTAKE IN THE DECLARATION DUR ING SEARCH WAS DUE TO INCORRECT BANK CREDIT SUMMATION WHICH IS MAT TER OF RECORD. ACCORDING TO THE LEARNED AUTHORIZED REPRESENTATIVE IN GENERAL, BOOKS PREPARED BY THE ASSESSEE HAVE NOT BEEN REJECTED BY COGENT REASONING. THE MAIN EMPHASIS OF THE ASSESSEE HAS BEEN THAT AGR ICULTURAL ACTIVITY AND RELATED INCOME WAS BONAFIDE ONE AS A S OURCE OF INITIAL FUNDS. THE SOURCE OF AGRICULTURAL INCOME OUGHT TO HAVE CONSIDERED THE OVERALL QUANTIFICATION OF INCOME. THE ADDITION HAS BEEN MADE ON THE BASIS OF SEARCH STATEMENT ALONE, WHICH IS NOT J USTIFIED. ACCORDING TO THE ASSESSING OFFICER, THE DISCLOSURE PROMISE DU RING SEARCH U/S.132(4) HAS NOT BEEN FULFILLED. WHILE, ACCORDIN G TO THE CIT(A), SELF SERVING BOOKS ARE NOT ADMITTED. THE ASSESSING OFFI CERS VERIFICATION OF BOOKS, HIS FINDINGS, ETC. ARE CONTRARY TO HIS FI NDING OF FACTS ON THE ISSUE. IN THIS BACKGROUND, THE STAND OF THE ASSESS EE HAS BEEN THAT THE ASSESSING OFFICERS OBSERVATION AS REGARDS THE BOOKS OF ACCOUNTS, MISTAKE OF QUANTIFICATION OF CREDITS, SUMMATIONS, E TC., ARE FACTS. THESE OBSERVATIONS OUGHT TO HAVE NOT BEEN BRUSHED A SIDE BY THE CIT(A). ACCORDING TO US, THIS APPROACH IS NOT JUST IFIED. THE AUTHORITIES BELOW SHOULD GIVE FINDING ON EACH AND E VERY POINT WHILE REACHING TO ITS CONCLUSION. 4.5 THE NEXT OBJECTION OF ASSESSEE HAS BEEN THA T THE RETURN FILED BASED ON BOOKS OF ACCOUNT AND INCOME DECLARED WAS R EFLECTED BASED ON COGENT REASONING. THE MAIN OBJECTION OF THE ASS ESSING OFFICER HAS BEEN THAT THERE IS LONG GAP OF 28 MONTHS FOR RETRAC TING BY WAY OF RETURN WHILE THERE WAS NO THREAT OR COERCION DURING SEARCH. 13 ACCORDING TO THE ASSESSING OFFICER, THE ONUS OF PRO VING MISUNDERSTANDING HAS NOT BEEN DISCHARGED BY THE ASS ESSEE. IN APPEAL, THE CIT(A) ON THIS POINT HAS HELD THAT THE RETRACTION AFTER 28 MONTHS IS NOT ACCEPTABLE. IN THIS REGARD, THE STAN D OF ASSESSEE HAS BEEN THAT THE RETRACTION IS BASED ON VALID REASONS OF ERROR OR MISTAKE, ETC., HENCE, OUGHT TO HAVE BEEN DELIBERATED ON MERI T. ACCORDING TO US, EVEN IF THE RETRACTION IS MADE AFTER A LONG GAP , IT SHOULD BE REJECTED BY COGENT REASONING. THE SAME WAS POSSIBL E BY DEMONSTRATING THE STAND OF THE ASSESSEE TAKEN BY WA Y OF BOOKS OF ACCOUNTS PREPARED AND PRODUCED AT ASSESSMENT STAGE AS WELL AS APPELLATE STAGE. ACCORDING TO THE ASSESSING OFFICE R, SUFFICIENT DOCUMENTS WERE NOT FILED IN THIS REGARD. WHILE IN APPEAL, THE CIT(A) OBSERVED THAT THE EXPENSES FOUND GENUINE WERE ALLOW ED BY THE ASSESSING OFFICER WHILE THE EXPENSES NOT SUPPORTED BY EVIDENCE WERE DISALLOWED BY THE ASSESSING OFFICER. THIS SHOWS TH AT THE DETAILS OF EXPENSES AS REFLECTED IN BOOKS OF ACCOUNTS PREPARED COULD NOT BE BRUSHED ASIDE. ACCORDING TO US, THE REASONING OF R ETRACTION SHOULD NOT BE REJECTED AT THE STRENGTH OF ADMISSION BY ASS ESSEE BUT RETRACTION BASED ON PREPARED BOOKS OF ACCOUNTS SHOU LD BE REJECTED BY COGENT REASONING ONLY. ACCORDING TO US, MATERIA L PUT FORWARD ON BEHALF OF ASSESSEE HAS BEEN REJECTED IN ADHOC MANNE R, WHICH IS NOT JUSTIFIED. HAVING SAID SO, LET US ANALYSE THE YEAR -WISE PROPOSITION AS RAISED BY THE LEARNED AUTHORIZED REPRESENTATIVE BEF ORE US. 4.6 FOR A.Y. 2004-05, SOURCE OF FUNDS FOR GHANAWAT LAND DEAL WERE CLAIMED FROM AGRICULTURAL INCOME AND GIFT FROM RELA TIVES. THE ASSESSING OFFICER IN PARA 7.2 OF PAGES 11 & 12 HAS OBSERVED THAT THE AGRICULTURAL INCOME WAS NOT SUFFICIENT CONSIDERING GHANAWAT LAND DEAL, HENCE, THE SAID ARGUMENT WAS NOT ACCEPTED. W HILE IN APPEAL, THE CIT(A) IN PARA 13, PAGE 22 OBSERVED THAT CONSID ERING THE LAVISH LIFE STYLE OF ASSESSEE, THE AGRICULTURAL INCOME OF 1.95 LAKHS WAS NOT SUFFICIENT TO EXPLAIN THE SOURCE OF LAND PAYMENT. IN THIS BACKGROUND, THE STAND OF THE ASSESSEE HAS BEEN THAT THE AMOUNT PAYMENTS RECORDED IN BOOKS OF ACCOUNTS, AGRICULTURAL INCOME WAS BONAFIDE AND 14 GIFTS HAVE NOT BEEN DOUBTED, SO THE ADDITION IN QUE STION WAS NOT JUSTIFIED. THUS, THE AUTHORITIES BELOW HAVE TAKEN CONTRADICTORY STAND WHILE REJECTING THE STAND OF ASSESSEE. IN FACT, IT SHOULD BE ANALYSED AS PER FACT PUT FORWARD BY THE ASSESSEE ON THE POIN T AND AUTHORITIES BELOW SHOULD HAVE APPRECIATED THE FACT BEFORE REACH ING ANY ADVERSE OPINION THAT TOO MAINLY BASED ON ADMISSION OF ASSES SEE. 4.7 FOR A.Y. 2005-06, THE STAND OF THE ASSESSEE HAS BEEN THAT ACTUAL BANK SUMMATIONS ARE 1.76 LAKHS AND THE DECLARATION OF 4.63 LAKHS WERE BASED ON ERRONEOUS ASSUMPTIONS. TH E STAND OF THE ASSESSEE HAS BEEN THAT THE ASSESSING OFFICER HIMSEL F AGREES WITH THE CREDIT STATEMENT, SO, THE ADDITION MADE AND CONFIRM ED BY THE CIT(A), IS NOT JUSTIFIED. FOR A.Y. 2006-07, THE STAND OF T HE ASSESSEE HAS BEEN THAT ACTUAL BANK SUMMATIONS ARE 2.97 LAKHS WHILE DECLARATION OF 4.50 LAKHS WAS BASED ON ERRONEOUS ASSUMPTION DURING SEARCH. THE ASSESSING OFFICER HAS REPRODUCED THE ASSESSEES STA TEMENTS, BANK SUMMATIONS ONLY 2.9 LAKHS AND NOT 4.5 LAKHS, BUT FURTHER OBSERVED THAT AS INCOME DISCLOSURE IN SEARCH IS NOT HONOURED AMOUNT DECLARED IN SEARCH, IS CONSIDERED AS TAXABLE INCOME. IN APPEAL, ON THIS POINT, THE CIT(A) IN PARA 22, PAGE 30 OBSERVED THAT THE DECLARATION MADE DURING SEARCH COULD NOT BE REJ ECTED ON THE BASIS OF BOOKS CREATED AS SELF SERVING EVIDENCE. I N THIS REGARD, THE STAND OF THE ASSESSEE HAS BEEN THAT THE BOOKS ARE M ADE ON THE BASIS OF BANK STATEMENT PRIMARILY. THE VERY SAME STATEME NT WAS USED AS BASIS FOR DECLARATION DURING SEARCH. THIS MISTAKE CREPT IN ASSESSMENT AND APPELLATE STAGE, WHICH COULD NOT BE CURED. ACCORDING TO US, THE FACTS ON RECORD SHOULD NOT HAV E BEEN IGNORED TO JUSTIFY ADDITION MAINLY BASED ON ADMISSION. 4.8 REGARDING A.Y. 2007-08, THE LEARNED AUTHORIZED REPRESENTATIVE HAS SUBMITTED THAT RECEIPTS AND CREDITS LIKE ADVANC E PLUS LOANS EXIST WHICH CANNOT BE CONSIDERED AS INCOME. IN THE ASSES SMENT PROCEEDINGS, THE ASSESSING OFFICER HAS REPRODUCED T HE CONTENTION RAISED ON BEHALF OF ASSESSEE AT PAGE 4 OF ITS ORDER WHILE ON PAGE 7 & 15 8, THERE IS NO DISCUSSION RELATING TO CREDIT ASPECT . WHILE FINALIZING TAXABLE INCOME, THE EXPENSES WERE PARTIALLY DISALLO WED IN THE ABSENCE OF SUPPORTING EVIDENCE BY THE ASSESSING OFF ICER. IN APPEAL, THE CIT(A) HELD THAT NEITHER THE RECEIPTS NOR THE E XPENSES WERE FOUND COMPLETE AND RELIABLE. BASED ON BOOKS, CONSOLIDATE D CHARTS WERE GIVEN ON BEHALF OF ASSESSEE. IGNORING THE SAME, AS SESSING OFFICERS ADDITION BASED ON SEARCH DECLARATION WAS HELD AS VA LID BY CIT(A). IN THIS REGARD, THE STAND OF THE ASSESSEE HAS BEEN THA T BEST POSSIBLE ATTEMPT WAS MADE TO EXPLAIN THE PROBLEMS IN TAKING CREDIT, SUMMATIONS AS TAXABLE INCOME. BOUNCED CHEQUES, REPA ID ADVANCES, ETC. COULD NOT BE INSTANCES OF INCOME. EVIDENCES P LACED ON RECORD SHOULD HAVE BEEN REJECTED AFTER DUE DELIBERATION ON THE SAME. A SIMILAR OBJECTION WAS RAISED FOR A.Y. 2008-09. REG ARDING A.Y. 2009- 10, THE LEARNED AUTHORIZED REPRESENTATIVE HAS SUBMI TTED THAT THE VALID CASH SOURCE EXISTS FOR 15 LAKHS PAID TO MS. KAVITA KAJALE ON 03.05.2008. THE ASSESSING OFFICER OBSERVED AT PAGE 22 OF ITS ORDER THAT THE PAYMENT OF 15 LAKHS WAS NOT REFLECTED IN BOOKS AND THE ASSESSEES EXPLANATION WAS NOT ACCEPTED. IN APPEAL , IN THIS REGARD, THE CIT(A) HAS OBSERVED THAT AT THIS STAGE, THE EXP LANATION COULD NOT BE CONSIDERED IN VIEW OF RULE 46A SINCE THIS CLAIM WAS NOT MADE BEFORE THE ASSESSING OFFICER. IN THIS REGARD, THE STAND OF THE ASSESSEE HAS BEEN THAT THE TRANSACTION OF SALE OF LEXUS CAR WAS STATED IN SEARCH STATEMENT ITSELF. THE TELESCOPIC EFFECT ON THE SAID RECEIPT OUGHT TO HAVE BEEN GIVEN. CONFIRMATION OF RECEIPT OF 15 LAKHS WAS GIVEN BY MR.CHASLANI AND THE SAME WAS PRODUCED BEFO RE THE CIT(A). IN THIS BACKGROUND, THE CIT(A) WAS NOT JUSTIFIED IN REJECTING CONTENTIONS OF ASSESSEE WHILE UPHOLDING THE ADDITIO N MADE BY THE ASSESSING OFFICER. THIS ASPECT NEEDS DEEP PROBE INT O THE MATTER ON THE ISSUE. 4.9 WITH REGARD TO THE OTHER ADDITION I.E. 32.50 LAKHS RECEIVED FROM MR. SONIGRA, THE STAND OF THE ASSESSEE HAS BEE N THAT THE SAID AMOUNT WAS NOT RECEIVED FROM RAVET LAND DEAL FROM M R. SONIGRA. ACCORDING TO THE LEARNED AUTHORIZED REPRESENTATIVE, BOTH THE 16 AUTHORITIES HAVE NOT COMMENTED ON THIS POINT. FURT HER, IN A.Y. 2009-10, THE STAND OF THE ASSESSEE HAS BEEN THAT TH E ASSESSEE DID NOT RECEIVE AMOUNT OF 1.35 CRORES IN CASH FROM SONIGRA. THE ASSESSING OFFICER HAS OBSERVED THAT SINCE SONIGRA H AS PAID TAXES ON 1.35 CRORES, THE ASSESSEE MUST HAVE RECEIVED THE S AME. THE CIT(A) CONFIRMED THE ORDER OF ASSESSING OFFICER ON THE POI NT. THE STAND OF THE ASSESSEE HAS BEEN THAT THE ASSESSEE HAS NOT REC EIVED ANY CASH FROM RAVET LAND DEAL FROM SONIGRA. HOWEVER, THE AS SESSEE WAS IN RECEIPT OF 33 LAKHS FOR ANOTHER LAND DEAL AT SHINDE WASTI WHI CH ULTIMATELY DID NOT MATERIALIZE. THE SAID FACT CLEA RLY EMERGED FROM THE STATEMENT OF SONIGRA. THESE ARGUMENTS OF ASSESSEE HAVE NOT BEEN MET OUT BY AUTHORITIES BELOW. ACCORDING TO US, IT IS NOT JUSTIFIED. TO REACH A PROPER CONCLUSION, IT NEEDS DEEP PROBE INTO THE MATTER. IT IS PERTINENT TO MENTION HERE THAT THE PERSON FROM AGRI CULTURAL BACKGROUND IS NOT ABLE TO UNDERSTAND AND MEET OUT E CONOMIC COMPLICATIONS WITH INCOME TAX ANGLE IN FAST URBANIZ ATION. 4.10 THE NEXT ISSUE RAISED BY ASSESSEE IS THAT SO NIGRA HIMSELF WAS MISLEADING AND CONFLICTING. THE CROSS-EXAMINATION OF SONIGRA WAS NOT GIVEN, WHICH IS NOT JUSTIFIED. IN THIS REGARD, THE ASSESSING OFFICER MADE BALD OBSERVATION THAT THE SONIGRAS STATEMENT WAS CORRECT AND AFFIDAVIT WAS NOT CORRECT, WHICH WAS CONFIRMED BY T HE CIT(A) ON THE POINT. ACCORDING TO ASSESSEE, THERE IS NO JUSTIFIC ATION DONE BY THE AUTHORITIES BELOW. THE CIT(A) DID NOT TAKE THE COG NIZANCE OF THE ARGUMENTS OF LEARNED AUTHORIZED REPRESENTATIVE. IN THIS REGARD, THE STAND OF THE ASSESSEE HAS BEEN THAT HE HAS NOT RECE IVED ANY CASH FROM RAVET LAND DEAL FROM SONIGRA. HOWEVER, THE AS SESSEE WAS IN RECEIPT OF 33 LAKHS FOR ANOTHER LAND DEAL AT SHINDE WASTI AS STATED ABOVE WHICH DID NOT ULTIMATELY MATERIALIZED. THESE FACTS HAVE NOT BEEN DEALT BY THE ASSESSING OFFICER AND THE CIT(A) PPROPERLY. NOTHING EMERGES FROM THE SEARCH MATERIAL AS SUCH IN DICATING THAT THE ENTIRE AMOUNT WAS PAID TO THE ASSESSEE. THE AS SESSING OFFICER AND THE CIT(A) ON THE BASIS OF STATEMENT OF SONIGRA HAVE PRESUMED THAT THE SAID AMOUNT HAS BEEN RECEIVED BY THE ASSES SEE. FURTHER, 17 THE CIT(A) STATED THAT THE ASSESSEE WAS AWARE OF TH E CONTENTS OF THE STATEMENT GIVEN BY SONIGRA. HOWEVER, THE ASSESSEE CLAIMED TO BE NOT AWARE OF THE FACT THAT STATEMENT OF SONIGRA, WHICH HAS BEEN TAKEN ON RECORD. COPIES OF THE STATEMENT WERE NOT PROVIDED AND CROSS- EXAMINATION OPPORTUNITY WAS ALSO NOT PROVIDED. IN THIS BACKGROUND, THE ARGUMENT OF THE ASSESSEE HAS BEEN THAT IN ALL T HE YEARS INVOLVED, THE ASSESSING OFFICER HAS DECIDED TO MAKE TAXABLE I NCOME ON THE BASIS OF DECLARATION MADE DURING SEARCH. AT THE TI ME OF SEARCH, THE DECLARATION OF INCOME WAS BASED ON BANK STATEMENT P LUS SEIZED PAPERS FOUND DURING SEARCH. FURTHER, THE BANK TRAN SACTIONS SUMMARY WAS PREPARED BY SEARCH PARTY ONLY. IN THE ABSENCE OF ANY CLARITY, THE ASSESSEE HAS MADE DECLARATION OF INCOM E AT RELEVANT POINT OF TIME. HOWEVER, ONCE BOOKS OF ACCOUNTS WERE PREP ARED, THE MISTAKE WAS REALIZED BY THE ASSESSEE. HENCE, DECLA RATION WAS RETRACTED. THE ASSESSING OFFICER COULD HAVE VERIFI ED THE RECONCILED INCOME PREPARED BY THE ASSESSEE WHICH WAS CONTRARY TO THE INCOME SUMMARY PREPARED AT THE TIME OF SEARCH WITH BOOKS O F ACCOUNTS PREPARED BY SEARCH PARTY. SPECIALLY SO WHEN THE AS SESSING OFFICER HAS ALSO ACCEPTED THE RECONCILIATION OF DIFFERENCES AS DISCUSSED ABOVE. AS SUCH, THE ASSESSING OFFICER MADE ADDITIO N MAINLY BASED ON SEARCH STATEMENT AND DISCREPANCY WORKED OUT BY S EARCH PARTY AT THE TIME OF SEARCH. THE ACTION OF THE ASSESSING OF FICER IN ADDING THE INCOME FOR ABOVE REASON, IN OUR OPINION, IS NOT JUS TIFIED. THE CIT(A) HAS NOT APPRECIATED THIS FACT AND MERELY DISMISSED THE APPEAL WITHOUT GIVING PROPER REASONING FOR THE SAME. THE BOOKS OF ACCOUNTS PREPARED AFTER SEARCH SHOULD NOT BE BRUSHED ASIDE. ONCE THE BOOKS OF ACCOUNTS OF ASSESSEE HAS BEEN PREPARED BASED MAI NLY ON THE BANK ENTRIES AND OTHER DETAILS, SAME CAN BE REJECTED BY COGENT REASONING. ACCORDING TO US, THE BOOKS OF ACCOUNTS SHOULD BE RE JECTED ONLY AFTER REJECTING THE CLAIM OF ASSESSEE BY COGENT REASONING BECAUSE THE ASSESSEES CONTENTION REVOLVES AROUND BANK STATEMEN T FOUND DURING THE COURSE OF SEARCH. 18 4.11 ACCORDING TO US, THIS WHOLE ISSUE SHOULD BE L OOKED INTO IN THE LIGHT OF ABOVE DISCUSSION. SO, WE SET ASIDE TH E ORDER OF CIT(A) AND RESTORE THE WHOLE ISSUE TO THE FILE OF THE ASSE SSING OFFICER WITH A DIRECTION TO DECIDE THE SAME AS PER FACT AND LAW AN D AFTER PROVIDING DUE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. SI MILARLY, THE OTHER ADDITIONS WITH REGARD TO LAND RIGHTS EXPENSES, DEPR ECIATION ON CARS, INTEREST ON LOANS AND OVERHEADS AND OTHER LAND DEAL S AND EXPENSES HAS TO BE LOOKED INTO BY THE ASSESSING OFFICER AS P ER FACT AND LAW AFTER PROVIDING DUE OPPORTUNITY OF BEING HEARD TO T HE ASSESSEE, WHICH IS THE ESSENCE OF PRINCIPLES OF NATURAL JUSTICE, WH ICH COULD NOT BE COMPROMISED IN ANY MANNER. SINCE, WE ARE SETTING A SIDE THE ORDER OF CIT(A) FOR ALL THE YEARS ON BROAD LEGAL PROPOSITION BASED ON PRINCIPLES OF NATURAL JUSTICE AS DISCUSSED ABOVE, WE ARE REFRA INING FROM COMMENTING ON THE MERIT OF THE ISSUE AT HAND. 5. IN THE RESULT, ALL THE APPEALS FILED BY ASSESSEE ARE ALLOWED FOR STATISTICAL PURPOSES AS DISCUSSED ABOVE. PRONOUNCED IN THE OPEN COURT ON THIS THE 27 TH DAY OF MAY, 2014. SD/- SD/- (R.K. PANDA) (SHAILENDRA KUMAR YADAV) ACCOUNTANT MEMBER JUDICIAL MEMBER PUNE, DATED: 27 TH MAY, 2014 GCVSR COPY TO:- 1. ASSESSEE 2. DEPARTMENT 3. THE CIT(A)-I, PUNE 4. THE CIT-I, PUNE 5. THE DR, B BENCH, I.T.A.T., PUNE. 6. GUARD FILE BY ORDER //TRUE COPY// SENIOR PRIVATE SECRETARY, I.T.A.T., PUNE