K.S.Ravikumar, Coimbatore V. ACIT, Trichy

ITA 1507/CHNY/2014

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 7852 (ITAT-CHENNAI)
• Duration Of Justice: 1 year(s) 9 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-03-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Assessment Year: 2009-2010
• Appeal Filed On: 02-06-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: C VATCHALA
• Assessee Lawyers: G RAMASAMY
• Keywords: Unexplained investment; Gift; Income from undisclosed sources; Block assessment
• Section: 153A; 68; 15

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH, CHENNAI . . . , . !'# ! , % !& BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER ./ ITA NOS.1505, 1506, 1507, 1508 & 1509/MDS/2014 ( )( / ASSESSMENT YEARS : 2007-08 TO 2011-12 SHRI K.S. RAVIKUMAR, NO.26/3, SASTI ILLAM, VIVEKANANDA NAGAR, SINGANALLUR, COIMBATORE 641 005. PAN : AJHPR 3493 A V. THE ASSISTANT COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE II, TRICHY. (+,/ APPELLANT) (-.+,/ RESPONDENT) +, / 0 / APPELLANT BY : SHRI G. RAMASAMY, FCA -.+, / 0 / RESPONDENT BY : MS. C. VATCHALA, JCIT 1 / 2% / DATE OF HEARING : 19.01.2016 3') / 2% / DATE OF PRONOUNCEMENT : 04.03.2016 / O R D E R PER N.R.S. GANESAN, JUDICIAL MEMBER: ALL THE APPEALS OF THE ASSESSEE ARE DIRECTED AGA INST THE COMMON ORDER OF THE COMMISSIONER OF INCOME TAX (APP EALS), TIRUCHIRAPPALLI, DATED 27.03.2014, FOR THE ASSESSME NT YEARS 2007- 08 TO 2011-12. THEREFORE, WE HEARD ALL THE APPEALS TOGETHER AND DISPOSING THE SAME BY THIS COMMON ORDER. 2 I.T.A. NOS.1505 TO 1509/MDS/14 2. SHRI G. RAMASAMY, THE LD. REPRESENTATIVE FOR THE ASSESSEE, SUBMITTED THAT THERE WAS A SEARCH IN THE PREMISES O F THE ASSESSEE ON 11.11.2010. CONSEQUENT TO THE SEARCH, THE ASSES SING OFFICER FRAMED THE ASSESSMENT UNDER SECTION 153C OF THE INC OME-TAX ACT, 1961 (IN SHORT 'THE ACT'). REFERRING TO SECTION 15 3C OF THE ACT, THE LD. REPRESENTATIVE SUBMITTED THAT WHEN A SEARCH WAS CONDUCTED IN THE PREMISES OF THE ASSESSEE, THE ASSESSMENT HAS TO BE FRAMED UNDER SECTION 153A OF THE ACT AND NOT UNDER SECTION 153C OF THE ACT. ACCORDING TO THE LD. REPRESENTATIVE, SECTION 153C OF THE ACT IS IN RESPECT OF THE PERSON OTHER THAN SEARCHED PERSON . IN THIS CASE, THE ASSESSEE WAS SUBJECTED TO SEARCH. THEREFORE, T HE ASSESSMENT HAS TO BE FRAMED ONLY UNDER SECTION 153A OF THE ACT AND NOT UNDER SECTION 153C OF THE ACT. THEREFORE, ACCORDING TO T HE LD. REPRESENTATIVE, THE ASSESSMENT FRAMED BY THE ASSESS ING OFFICER UNDER SECTION 153C OF THE ACT IS NULL AND AVOID. 3. SHRI G. RAMASAMY, THE LD. REPRESENTATIVE FOR THE ASSESSEE, FURTHER SUBMITTED THAT EVEN ASSUMING THAT THE ASSES SEE WAS OTHER THAN THE SEARCHED PERSON, STILL THE ASSESSING OFFIC ER HAS TO RECORD HIS SATISFACTION AS PROVIDED UNDER SECTION 153C OF THE ACT. REFERRING TO THE CIRCULAR ISSUED BY THE CBDT IN CIR CULAR NO.24/2015 3 I.T.A. NOS.1505 TO 1509/MDS/14 DATED 31.12.2015, THE LD. REPRESENTATIVE SUBMITTED THAT RECORDING OF A SATISFACTION NOTE IS A PRE-REQUISITE AND THE SATI SFACTION NOTE MUST BE PREPARED BY THE ASSESSING OFFICER BEFORE HE TRAN SMITS THE RECORD TO THE OTHER ASSESSING OFFICER WHO HAS JURISDICTION OVER THE PERSON, WHO IS OTHER THAN THE SEARCHED PERSON. REFERRING T O PARA 4 OF THE ABOVE CBDT CIRCULAR, THE LD. REPRESENTATIVE SUBMITT ED THAT THE CBDT HAS CLARIFIED THAT EVEN IF THE A.O. OF THE SEA RCHED PERSON AND THE OTHER THAN THE SEARCHED PERSON IS ONE AND THE S AME, THEN ALSO THE ASSESSING OFFICER IS REQUIRED TO RECORD HIS SAT ISFACTION AS HAS BEEN HELD BY THE COURTS. ACCORDING TO THE LD. REP RESENTATIVE, THE ASSESSING OFFICER HAS TO RECORD HIS SATISFACTION IN THE FILE OF THE SEARCHED PERSON WHEN HE IS ISSUING NOTICE IN THE CA SE OF THE PERSON OTHER THAN THE SEARCHED PERSON. IN THE CASE BEFORE US, ACCORDING TO THE LD. REPRESENTATIVE, NO SATISFACTION WAS RECORDE D IN THE CASE OF THE SEARCHED PERSON WITH REGARD TO MATERIAL FOUND R ELATING TO THE PRESENT ASSESSEE. THEREFORE, THE ASSESSMENT FRAMED UNDER SECTION 153C OF THE ACT IS NOT JUSTIFIED. REFERRIN G TO THE DECISION OF THE DELHI BENCH OF THIS TRIBUNAL IN SUPER MALLS PVT . LTD. V. DCIT (2015) 45 CCH 330, A COPY OF WHICH IS FILED BEFORE THIS TRIBUNAL, THE LD. REPRESENTATIVE SUBMITTED THAT SATISFACTION HAS TO BE RECORDED IN THE CASE OF THE SEARCHED PERSON. THE SATISFACTION, IF ANY, RECORDED 4 I.T.A. NOS.1505 TO 1509/MDS/14 IN THE CASE OF OTHER PERSON WILL NOT CURE THE DEFEC T BECAUSE IT IS NECESSARY THAT THE SATISFACTION MUST BE RECORDED BY THE ASSESSING OFFICER OF THE SEARCHED PERSON. AFTER RECORDING SA TISFACTION, ACCORDING TO THE LD. REPRESENTATIVE, THE DOCUMENTS ARE TO BE HANDED OVER TO THE ASSESSING OFFICER OF OTHER PERSO N, OTHER THAN THE SEARCHED PERSON. THIS POSITION WILL NOT ALTER EVEN IF THE ASSESSING OFFICER FOR THE SEARCHED PERSON AND THE OTHER PERSO N ARE ONE AND THE SAME. IN VIEW OF THIS DECISION OF DELHI BENCH OF THIS TRIBUNAL, ACCORDING TO THE LD. REPRESENTATIVE, THE ASSESSMENT FRAMED BY THE ASSESSING OFFICER CANNOT STAND IN THE EYE OF LAW. 4. COMING TO THE MERIT OF THE ADDITION MADE BY THE ASSESSING OFFICER, SHRI G. RAMASAMY, THE LD. REPRESENTATIVE F OR THE ASSESSEE, SUBMITTED THAT FOR THE ASSESSMENT YEAR 2007-08, THE ASSESSING OFFICER MADE AN ADDITION OF ` 40,00,000/- BEING THE GIFT RECEIVED BY THE ASSESSEE FROM HIS FATHER. ACCORDING TO THE LD. REPRESENTATIVE, THE ASSESSEE HAS EARNED AN INCOME OF ` 1,50,000/- BEING THE INTEREST FROM THE ADVANCE OF ` 40,00,000/- RECEIVED FROM HIS FATHER. THE RECEIPT OF ` 40,00,000/- WAS MENTIONED IN THE LOOSE SHEETS IN KS/B&D/S.2 FOUND BY THE REVENUE AUTHORITIES DURING THE COURSE OF SEARCH OPERATION. IGNORING THE SEIZED MATERIAL, TH E ASSESSING 5 I.T.A. NOS.1505 TO 1509/MDS/14 OFFICER HAS TAKEN THE SUM OF ` 40,00,000/- AS INCOME OF THE ASSESSEE. ACCORDING TO THE LD. REPRESENTATIVE, THE ASSESSEES FATHER SHRI K.A. SUBBIAH SOLD ONE PORTION OF THE LA ND. THE ASSESSEE HAS FILED COPIES OF SALE DOCUMENT BEFORE THE ASSESS ING OFFICER TO SUPPORT THE SOURCE OF HIS FATHER. THE ASSESSEES F ATHER SHRI K.A. SUBBIAN HAS ALSO FILED CONFIRMATION LETTER EXPLAINI NG HIS SOURCE. THE VILLAGE ADMINISTRATIVE OFFICERS CERTIFICATE ESTABL ISHES THAT THE ASSESSEES FATHER IS ALSO CULTIVATING 5.56 ACRES OF LAND. THE LD. REPRESENTATIVE FURTHER SUBMITTED THAT THE CLAIM OF AGRICULTURAL INCOME OF THE ASSESSEES FATHER WAS REJECTED BY THE ASSESS ING OFFICER ON THE GROUND THAT THE ASSESSEES FATHER COULD NOT MAI NTAIN ANY BOOKS OF ACCOUNT FOR AGRICULTURAL INCOME. ACCORDING TO THE LD. REPRESENTATIVE, THE FACT THAT THE ASSESSEES FATHER WAS HOLDING AGRICULTURAL LAND AND HE WAS CULTIVATING THE SAME I S EVIDENCED BY THE VILLAGE ADMINISTRATIVE OFFICERS CERTIFICATE. MERELY BECAUSE THE ASSESSEES FATHER WAS NOT MAINTAINING ANY RECORD FO R HIS AGRICULTURAL ACTIVITY THAT CANNOT BE A REASON TO REJECT THE CLAI M OF THE ASSESSEE. THE LD. REPRESENTATIVE FURTHER SUBMITTED THAT THE A SSESSEES FATHER HAS ALSO FILED CONFIRMATION LETTER CONFIRMING THE G IFT OF ` 40,00,000/- TO HIS SON, THE ASSESSEE. THE CONFIRMATION LETTER FURTHER CLARIFIED THAT THE ASSESSEES FATHER WAS DOING FINANCE BUSINE SS IN HIS NATIVE 6 I.T.A. NOS.1505 TO 1509/MDS/14 VILLAGE BY ADVANCING TO AGRICULTURISTS. THIS FACT WAS NOT DENIED BY THE ASSESSING OFFICER. THEREFORE, ACCORDING TO THE LD. REPRESENTATIVE, THERE IS NO NEED FOR MAKING ADDITIO N OF ` 40,00,000/- UNDER SECTION 68 OF THE ACT. 5. COMING TO THE NEXT ADDITION OF ` 35,40,000/-, THE LD. REPRESENTATIVE SUBMITTED THAT THE ASSESSING OFFICER ESTIMATED THE INCOME OF THE ASSESSEE ON THE BASIS OF COMPUTER GEN ERATED LOOSE SHEET, WHICH WAS MARKED AS KS/LS/S-9. ACCORDING TO THE LD. REPRESENTATIVE, THE ASSESSING OFFICER HAS TAKEN THE DIFFERENCE OF ` 1,86,02,408/- BETWEEN THE DEBIT SIDE AND CREDIT SID E OF LOOSE SHEET NO.75 DATED 25.02.2010 AS UNDISCLOSED INCOME OF THE ASSESSEE ON ESTIMATE BASIS FOR THE ASSESSMENT YEARS 2007-08 TO 2010-11 AND APPORTIONED THE SAME AT ` 40,00,000/- FOR THE ASSESSMENT YEAR 2007-08, ` 45,00,000/- FOR THE ASSESSMENT YEAR 2008-09, ` 50,00,000/- FOR THE ASSESSMENT YEAR 2009-10 AND ` 51,02,408/- FOR THE ASSESSMENT YEAR 2011-12. REFERRING TO THE SEIZ ED MATERIAL KS/B&D/S-3, THE LD. REPRESENTATIVE SUBMITTED THAT T HERE WAS A MENTION ABOUT THE ADVANCE MADE BY ONE SHRI V.T. ELA NGOVAN FROM 24.05.2009 TO 17.12.2009. DURING THE COURSE OF SEA RCH OPERATION, NO MATERIAL WAS FOUND WITH REGARD TO FINANCE BUSINE SS. THE LD. 7 I.T.A. NOS.1505 TO 1509/MDS/14 REPRESENTATIVE FURTHER SUBMITTED THAT IN THE ABSENC E OF ANY SEARCH MATERIAL, THERE CANNOT BE ANY ADDITION FOR THE BLOC K PERIOD. 6. REFERRING TO THE COMPUTER GENERATED LOOSE SHEETS MARKED AS KS/LS/S-9, THE LD. REPRESENTATIVE FOR THE ASSESSEE SUBMITTED THAT THE ASSESSEE HAS NOT DISCLOSED THE ACTUAL CAPITAL E MPLOYED TO CARRYING ON THE BUSINESS OF FINANCE. REFERRING TO LOOSE SHEET PAGE NO.35, THE LD. REPRESENTATIVE SUBMITTED THAT THE DE BIT AND CREDIT SIDE WAS BALANCED BY SHOWING THE AMOUNT OF ` 1,97,28,573/-. THE LD. REPRESENTATIVE FURTHER SUBMITTED THAT THE LOOSE SHEETS WERE FOUND ONLY FOR SOME DATES IN THE FINANCIAL YEARS 20 09-10 AND 2010- 11 AND NO SUCH SLIPS WERE FOUND OR RECORDED IN THE BOOKS OF ACCOUNT OF THE ASSESSEE FOR OTHER ASSESSMENT YEARS. IN OTHER WORDS, NO SEIZED MATERIAL WAS AVAILABLE FOR FINANCI AL YEARS 2006-07, 2007-08 AND 2008-09. THEREFORE, IN THE ABSENCE OF ANY FURTHER MATERIAL WITH REGARD TO INVESTMENT MADE BY THE ASSE SSEE, ESTIMATING INCOME FOR THOSE ASSESSMENT YEARS IS ARB ITRARY. THE LD. REPRESENTATIVE PLACED HIS RELIANCE ON CHANDIGARH BE NCH OF PUNJAB & HARYANA HIGH COURT IN CIT V. FAQIR CHAND CHAMANLA L (2003) 262 ITR 295. THE LD. REPRESENTATIVE SUBMITTED THAT THE LOOSE SHEETS FOUND DURING THE COURSE OF SEARCH OPERATION ARE NOT ADMISSIBLE 8 I.T.A. NOS.1505 TO 1509/MDS/14 EVIDENCE, THEREFORE, WHEN THE DEPARTMENT ITSELF IS UNABLE TO QUANTIFY THE UNDISCLOSED INCOME, ACCORDING TO THE LD. REPRES ENTATIVE, THE ASSESSING OFFICER IS NOT JUSTIFIED IN MAKING ADDITI ON. 7. COMING TO THE ASSESSMENT YEAR 2009-10, THE LD. REPRESENTATIVE FOR THE ASSESSEE SUBMITTED THAT ON T HE BASIS OF LOOSE SHEET IN KS/LS/S-9, AN ADDITION OF ` 38,03,653/- WAS MADE. ACCORDING TO THE LD. REPRESENTATIVE, THE CREDIT AND DEBITS FOUND IN THE LOOSE SHEETS RELATE TO ONE SHRI V.T. ELANGOVAN AND NOT TO THE ASSESSEE. ACCORDING TO THE LD. REPRESENTATIVE, WIT HOUT ANY CONCRETE MATERIAL FOUND DURING THE COURSE OF SEARCH OPERATION, THERE CANNOT BE ANY ADDITION EITHER FOR THIS YEAR OR FOR ANY OTHER YEARS. HOWEVER, FOR MAKING ADDITION ON ESTIMATE BASIS, NO MATERIAL WAS FOUND DURING THE COURSE OF SEARCH OPERATION. NO DE TAILS OF CAPITAL CONTRIBUTION MADE BY THE ASSESSEE WERE AVAILABLE ON RECORD. ACCORDING TO THE LD. REPRESENTATIVE, THE ADDITION M ADE BY THE ASSESSING OFFICER TO THE EXTENT OF ` 7,30,000/- INCLUDED THE GIFT OF ` 5,00,000/- RECEIVED BY THE ASSESSEE FROM HIS FATHER . THE LD. REPRESENTATIVE FURTHER SUBMITTED THAT THE ASSESSEE S FATHER RECEIVED A LOAN FROM SMT. G. RUCKMANI OF VALASAMUTHURAM OF K ANGAYAM TALUK AND GIFTED A SUM OF ` 3,20,000/- TO THE ASSESSEE. THE RECEIPT 9 I.T.A. NOS.1505 TO 1509/MDS/14 OF ` 5,00,000/- FROM THE ASSESSEES FATHER IS ALSO EVIDE NCED BY THE MATERIAL FOUND DURING THE COURSE OF SEARCH OPERATIO N. THIS WAS FURTHER CONFIRMED BY THE STATEMENT MADE BY THE ASSE SSEES FATHER BEFORE THE ASSESSING OFFICER. HOWEVER, THE ASSESSI NG OFFICER REJECTED THE CLAIM OF THE ASSESSEE. ACCORDING TO T HE LD. REPRESENTATIVE, THE ASSESSING OFFICER ESTIMATED AN AMOUNT OF ` 50,00,000/- AS INCOME OF THE ASSESSEE FOR THE ASSES SMENT YEAR 2009-10. THE LD. REPRESENTATIVE FURTHER CLARIFIED THAT AFTER DEDUCTING AN AMOUNT OF ` 11,96,347/-, THE BALANCE AMOUNT OF ` 38,03,653/- WAS ADDED AS UNDISCLOSED INCOME FOR THE BLOCK PERIOD. THEREFORE, ADDITION OF ` 38,03,653/- IS NOT JUSTIFIED. SIMILARLY, THE ADDITION MADE BY THE ASSESSING OFFICER TOWARDS INTE REST OF ` 7,46,930/- IS ALSO NOT JUSTIFIED. 8. NOW COMING TO ASSESSMENT YEAR 2010-11, THE LD. REPRESENTATIVE FOR THE ASSESSEE SUBMITTED THAT ON E STIMATE BASIS, THE ASSESSING OFFICER MADE AN ADDITION OF ` 44,39,908/- ON THE BASIS OF LOOSE SHEETS SAID TO BE FOUND IN KS/LS/S-9. ACC ORDING TO THE LD. REPRESENTATIVE, THE TRANSACTION OF THE ASSESSEE WIT H SHRI V.T. ELANGOVAN WAS REFLECTED IN THE LOOSE SHEET. NO MAT ERIAL WAS FOUND DURING THE COURSE OF SEARCH OPERATION IN THE CASE O F THE ASSESSEE. 10 I.T.A. NOS.1505 TO 1509/MDS/14 IN THE ABSENCE OF ANY MATERIAL FOUND DURING THE COU RSE OF SEARCH OPERATION, ACCORDING TO THE LD. REPRESENTATIVE, THE RE CANNOT BE ANY ADDITION FOR THE BLOCK PERIOD UNDER SECTION 158BC O F THE ACT. 9. NOW COMING TO THE ADDITION OF ` 3,20,000/-, THE LD. REPRESENTATIVE FOR THE ASSESSEE SUBMITTED THAT IT I S A GIFT RECEIVED FROM THE ASSESSEES FATHER OUT OF AGRICULTURAL INCO ME. THE ASSESSEES FATHER HAS ALSO CONFIRMED THE GIFT OF ` 3,20,000/-. THE LD. REPRESENTATIVE FURTHER SUBMITTED THAT THE ASSES SEE HAS PURCHASED A CAR FOR ` 4,50,000/- OUT OF THE LOAN FROM THE FINANCE FIRM. THE LD. REPRESENTATIVE FURTHER SUBMITTED THAT THE A SSESSEE HAS DEMONSTRATED THE AVAILABLE CASH BY WAY OF CASH FLOW STATEMENT FILED BEFORE THE ASSESSING OFFICER. FOR THE ASSESSMENT Y EAR 2010-11, THE ASSESSEE HAS DECLARED AN INCOME OF ` 14,61,060/-. HOWEVER, THE ASSESSING OFFICER MADE AN ADDITION OF ` 44,39,908/-. ACCORDING TO THE LD. REPRESENTATIVE, THE ADDITION MADE BY THE ASSESSING OFFICER IN THE ABSENCE OF SEIZED MATERIAL IS NOT JU STIFIED. 10. NOW COMING TO ASSESSMENT YEAR 2011-12, THE ASSE SSING OFFICER ESTIMATED THE DAILY INCOME OF THE ASSESSEE AT ` 11,408/-. THE ASSESSING OFFICER MADE AN ADDITION OF ` 30,05,220/- AFTER DEDUCTING THE INCOME DECLARED BY THE ASSESSEE OF ` 11,58,700/-. 11 I.T.A. NOS.1505 TO 1509/MDS/14 THE ASSESSING OFFICER HAS ALSO MADE AN ADDITION OF ` 12,70,000/- BEING AN INVESTMENT FOR PURCHASE OF A PLOT AND ` 44,00,000/- BEING THE PURCHASE OF HOUSE PROPERTY AT COIMBATORE. TOTA LLY, THE ASSESSING OFFICER MADE AN ADDITION OF ` 56,70,000/- AS UNDISCLOSED INVESTMENT. ACCORDING TO THE LD. REPRESENTATIVE, T HE LOOSE SHEETS FOUND DURING THE COURSE OF SEARCH OPERATION RELATE TO ONE SHRI V.T. ELANGOVAN AND NOT TO THE ASSESSEE. THE ASSESSING O FFICER CONVENIENTLY IGNORED THE MATERIAL FOUND DURING THE COURSE OF SEARCH OPERATION AND ESTIMATED THE INCOME FOR MAKING ADDIT ION IN THE ASSESSEES HANDS. ACCORDING TO THE LD. REPRESENTAT IVE, NO ADDITION CAN BE MADE ON DAILY OR MONTHLY BASIS IN THE ABSENC E OF SEARCH MATERIAL. THEREFORE, THE ADDITION OF ` 30,05,220/- MADE BY THE ASSESSING OFFICER IS CONTRARY TO THE PROVISIONS OF INCOME-TAX ACT. COMING TO THE ADDITION OF ` 56,70,000/- BEING THE INVESTMENT MADE IN THE PLOT AND HOUSE PROPERTY AT COIMBATORE, THE L D. REPRESENTATIVE SUBMITTED THAT THE ASSESSEE HAS DISCLOSED ` 12,70,000/- FOR PURCHASE OF VACANT PLOT AND ` 31,00,000/- FOR THE PURCHASE OF HOUSE PROPERTY IN THE FUND FLOW STATEMENT FILED BEFORE TH E ASSESSING OFFICER. THEREFORE, ACCORDING TO THE LD. REPRESENT ATIVE, THE ASSESSING OFFICER IS NOT JUSTIFIED IN SAYING THAT T HE ASSESSEE HAS NOT SHOWN ANY EVIDENCE TOWARDS PURCHASE OF VACANT PLOT AND HOUSE 12 I.T.A. NOS.1505 TO 1509/MDS/14 PROPERTY AT COIMBATORE. THE LD. REPRESENTATIVE FUR THER SUBMITTED THAT BY TELESCOPING THE INCOME EARNED BY THE ASSESS EE FOR ALL THE YEARS UNDER CONSIDERATION, THE INVESTMENT MADE BY T HE ASSESSEE CANNOT AT ALL BE TREATED AS UNDISCLOSED INCOME. AC CORDING TO THE LD. REPRESENTATIVE, AT PAGE 178 OF THE SEIZED MATER IAL KS/B&D/S-6 SHRI V.T. ELANGOVAN MENTIONED SOME FIGURES. THIS W RITING MADE IN THE LOOSE SHEET AT PAGE 178 DOES NOT MENTION ANY DE TAILS ABOUT ANY PARTICULAR HOUSE AND INVESTMENT MADE BY THE ASSESSE E. THE ASSESSEE IN FACT PURCHASED THE HOUSE ON 27.08.2010. THEREFORE, THE LOOSE SHEET DOES NOT REFER TO THE INVESTMENT MA DE BY THE ASSESSEE AT ALL. THEREFORE, ACCORDING TO THE LD. R EPRESENTATIVE, THERE IS NO JUSTIFICATION FOR MAKING ANY ADDITION. 11. ON THE CONTRARY, MS. C. VATCHALA, THE LD. DEPAR TMENTAL REPRESENTATIVE, SUBMITTED THAT NO DOUBT, THERE WAS A SEARCH CARRIED OUT BY THE REVENUE IN THE RESIDENTIAL PREMISES OF T HE ASSESSEE. ACCORDING TO THE LD. D.R., THE SEARCH WAS INITIATED IN THE CASE OF SHRI T. MUNIAPPAN, SHRI T. ELANGOVAN AND SHRI V.T. KUMARAVEL OF KARUR ON 11.11.2010. WHILE CARRYING OUT THE SEARCH IN THE CASE OF SHRI T. MUNIAPPAN, SHRI T. ELANGOVAN AND SHRI V.T. KUMARAVEL, A SEARCH WARRANT WAS ALSO ISSUED TO SEARCH THE RESIDE NCE OF THE 13 I.T.A. NOS.1505 TO 1509/MDS/14 ASSESSEE AT SINGANALLUR, COIMBATORE. THEREFORE, AC CORDING TO THE LD. D.R., THE SEARCH WAS CONDUCTED ONLY IN THE HAND S OF SHRI T. MUNIAPPAN, SHRI T. ELANGOVAN AND SHRI V.T. KUMARAVE L AND NOT IN THE HANDS OF THE ASSESSEE. IN THE COURSE OF CARRYI NG ON SEARCH IN THE HANDS OF SHRI T. MUNIAPPAN, SHRI T. ELANGOVAN A ND SHRI V.T. KUMARAVEL, THE ASSESSEES RESIDENTIAL PREMISES WAS ALSO SUBJECTED TO SEARCH. THEREFORE, ACCORDING TO THE LD. D.R., T HE ASSESSEE IS A PERSON OTHER THAN THE SEARCHED PERSON. ACCORDINGLY , PROCEEDING HAS TO BE INITIATED ONLY UNDER SECTION 153C OF THE ACT AND NOT UNDER SECTION 153A OF THE ACT. THEREFORE, THE CONTENTION OF THE ASSESSEE THAT THE PROCEEDING HAS TO BE INITIATED ONLY UNDER SECTION 153A OF THE ACT AND NOT UNDER SECTION 153C OF THE ACT IS NO T JUSTIFIED AT ALL. 12. NOW COMING TO THE SATISFACTION SAID TO BE RECOR DED BY THE ASSESSING OFFICER, THE LD. D.R. HAS FILED COPIES OF THE ORDER SHEET AND SUBMITTED THAT THE ASSESSING OFFICER HAS RECORD ED THE SATISFACTION BY SAYING THAT THE BOOKS OF ACCOUNT AN D DOCUMENTS BELONGED TO THE PRESENT ASSESSEE. ACCORDING TO THE LD. D.R., THE ASSESSING OFFICER OF THE SEARCHED PERSON AND THE AS SESSEE BEING THE PERSON OTHER THAN SEARCHED, ARE ONE AND THE SAM E, THEREFORE, THE SATISFACTION RECORDED BY THE ASSESSING OFFICER ON THE FILE OF THE 14 I.T.A. NOS.1505 TO 1509/MDS/14 ASSESSEE IS MORE THAN SUFFICIENT AS REQUIRED UNDER SECTION 153C OF THE ACT. THEREFORE, IT MAY NOT BE CORRECT TO SAY T HAT THE ASSESSING OFFICER HAS NOT RECORDED ANY SATISFACTION FOR INITI ATING PROCEEDING AGAINST THE ASSESSEE UNDER SECTION 153C OF THE ACT. 13. COMING TO THE MERIT OF THE ADDITION MADE BY THE ASSESSING OFFICER, THE LD. D.R. SUBMITTED THAT SHE IS PLACING HER RELIANCE ON THE OBSERVATION MADE BY THE CIT(APPEALS). 14. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EIT HER SIDE AND PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. THE MATERIAL AVAILABLE ON RECORD CLEARLY ESTABLISHES THAT THE SE ARCH WAS INITIATED AGAINST SHRI T. MUNIAPPAN, SHRI T. ELANGOVAN AND SH RI V.T. KUMARAVEL OF KARUR ON 11.11.2010. IN THE COURSE OF SEARCH OPERATION, A WARRANT WAS ALSO INITIATED TO SEARCH T HE RESIDENCE OF SHRI K.S. RAVIKUMAR, THE PRESENT ASSESSEE. THEREFO RE, IT IS OBVIOUS THAT THE SEARCH WAS IN THE CASE OF SHRI T. MUNIAPPA N, SHRI T. ELANGOVAN AND SHRI V.T. KUMARAVEL AND THE PLACE OF SEARCH WAS THE RESIDENCE OF THE ASSESSEE. HENCE THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT THE ASSESSEE IS NOT THE SEA RCHED PERSON. THEREFORE, THE PROCEEDING ON THE BASIS OF MATERIAL FOUND DURING THE COURSE OF SEARCH OPERATION IN THE CASE OF SHRI T. M UNIAPPAN, SHRI T. 15 I.T.A. NOS.1505 TO 1509/MDS/14 ELANGOVAN AND SHRI V.T. KUMARAVEL, HAS TO BE INITIA TED AGAINST THE ASSESSEE UNDER SECTION 153C OF THE ACT AND NOT UNDE R SECTION 153A OF THE ACT. THEREFORE, THIS TRIBUNAL IS OF TH E CONSIDERED OPINION THAT THE ASSESSING OFFICER HAS RIGHTLY INIT IATED PROCEEDING UNDER SECTION 153C OF THE ACT, WHICH WAS CONFIRMED BY THE CIT(APPEALS). THEREFORE, THIS TRIBUNAL DO NOT FIND ANY REASON TO INTERFERE WITH THE ORDER OF THE LOWER AUTHORITY AND THE SAME IS CONFIRMED. 15. NOW COMING TO MERIT OF THE ADDITION MADE BY THE ASSESSING OFFICER, THE ASSESSING OFFICER ESTIMATED ` 1,86,02,408/- AS UNDISCLOSED INCOME FOR THE ASSESSMENT YEARS 2007-08 , 2008-09, 2009-10 AND 2010-11 AND APPORTIONED THE SAME AT ` 40,00,000/-, ` 45,00,000/-, ` 50,00,000/- AND ` 51,02,408/- RESPECTIVELY. FOR THE ASSESSMENT YEAR 2007-08, THE ASSESSEE CLAIMED RECEI PT OF ` 40,00,000/- AS GIFT RECEIVED FROM HIS FATHER. THIS WAS DISBELIEVED BY THE ASSESSING OFFICER. FROM THE ORDERS OF THE L OWER AUTHORITIES IT APPEARS THAT THE ASSESSEE WAS CARRYING ON THE BUSIN ESS OF MONEY LENDING IN THE NAME AND STYLE OF COVAI BALAJI FINAN CE. THE ASSESSEE EXPLAINED BEFORE THE ASSESSING OFFICER THA T HIS FATHER SHRI K.A. SUBBIAN, RETD. SECRETARY OF AGRICULTURAL CO-OP ERATIVE BANK, 16 I.T.A. NOS.1505 TO 1509/MDS/14 ADVANCED A SUM OF ` 40,00,000/- AS GIFT TO THE ASSESSEE. THE ASSESSING OFFICER FOUND THAT THE ASSESSEE HAS SHOWN THE CAPITAL OF ` 40,00,000/- AS OPENING CAPITAL OUT OF THE GIFT RECE IVED FROM HIS FATHER. THE ASSESSING OFFICER FOUND THAT THE RETIR EMENT BENEFIT OF THE ASSESSEES FATHER WAS ` 2,50,000/-. THOUGH THE ASSESSEE CLAIMS THAT HIS FATHER WAS CULTIVATING 15.5 ACRES O F LAND, THE ASSESSING OFFICER FOUND THAT OTHER THAN THE VILLAGE ADMINISTRATIVE OFFICERS CERTIFICATE, NO OTHER MATERIAL IS AVAILAB LE TO SUBSTANTIATE THE CLAIM OF THE AGRICULTURAL ACTIVITY. EVEN THE VAOS CERTIFICATE SAYS THAT THE ASSESSEES FATHER WAS HOLDING ONLY 5.56 AC RES OF LAND. THE ASSESSEES FATHER CLAIMS THAT HE RECEIVED LOAN FROM THREE PERSONS TO THE EXTENT OF ` 5,00,000/-. BY TAKING INTO CONSIDERATION OF THE CLAIM OF THE ASSESSEE, THE ASSESSING OFFICER FOUND THAT THE ASSESSEES FATHER HAS NO SOURCE FOR MAKING GIFT OF ` 40,00,000/-. THE FACT REMAINS THAT THE ASSESSEES FATHER, A RETI RED EMPLOYEE OF AGRICULTURAL CO-OPERATIVE BANK, RECEIVED RETIREMENT BENEFIT OF ` 2,50,000/-. THE RECEIPT OF ` 5,00,000/- BY WAY OF LOAN BY THE ASSESSEES FATHER IS ALSO EVIDENCED FROM THE CONFIR MATION LETTER FILED BY HIS FATHER SHRI K.A. SUBBIAN. THE LOAN WAS SAID TO BE RECEIVED FROM SHRI R. BALASUBRAMANIAN, SHRI C. DHARMARAJ AND SMT. G. RUCKMANI. THE ASSESSING OFFICER HAS NOT TAKEN ANY EFFORT TO VERIFY 17 I.T.A. NOS.1505 TO 1509/MDS/14 THE CLAIM OF THE ASSESSEES FATHER ABOUT THE RECEIP T OF LOAN FROM THE ABOVE SAID THREE PERSONS. THE VAOS CERTIFICATE SH OWS THAT THE ASSESSEES FATHER WAS CULTIVATING 5.56 ACRES OF LAN D. THE CLAIM OF THE ASSESSEES FATHER THAT AGRICULTURAL INCOME TO T HE EXTENT OF ` 25,000/- PER ACRE WAS RECEIVED IS NOT IN DISPUTE. THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT THE VILLAGE ADMINISTRAT IVE OFFICER, BEING THE FIELD OFFICER OF THE STATE GOVERNMENT FOR TAKIN G THE CULTIVATION ACCOUNT IN EVERY SIX MONTHS, THE CERTIFICATE ISSUED BY THE VAO IN THE COURSE OF ITS OFFICIAL DUTY, CANNOT BE IGNORED AT A LL. IN THE ABSENCE OF ANY OTHER DOCUMENT TO SHOW THAT THE AGRICULTURAL LA ND WAS NOT AT ALL CULTIVATED, THIS TRIBUNAL IS OF THE CONSIDERED OPIN ION THAT THE DOCUMENT, NAMELY, THE CERTIFICATE OF THE VAO HAS SA NCTITY RELEVANCE TO ESTIMATE THE AGRICULTURAL INCOME. BY TAKING INT O CONSIDERATION OF THE LAND HOLDING AND CULTIVATION SAID TO BE MADE BY THE ASSESSEES FATHER, THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT THE CLAIM OF ACCUMULATED AGRICULTURAL INCOME OF ` 30,00,000/- CANNOT BE DOUBTED AT ALL. 16. THE ASSESSEES FATHER HAS ALSO CLAIMED A SUM OF ` 3,00,000/- GIVEN TO HIS SON DURING THE YEAR 2008-09 AND ANOTHE R AMOUNT OF ` 3,00,000/- DURING THE YEAR 2009-10. TOTALLY, THE A SSESSEES FATHER 18 I.T.A. NOS.1505 TO 1509/MDS/14 HAS GIFTED ` 46,00,000/-. IN VIEW OF THE ABOVE, THIS TRIBUNAL I S OF THE CONSIDERED OPINION THAT THE ASSESSING OFFICER MAY N OT BE JUSTIFIED IN DISBELIEVING THE CLAIM OF GIFT OF ` 40,00,000/- BY THE ASSESSEES FATHER. THE ASSESSEES FATHER BEING THE SECRETARY OF AGRICULTURAL CO-OPERATIVE BANK, HAS EXPOSED TO THE AGRICULTURAL ACTIVITIES. THEREFORE, MERELY BECAUSE THE MONEY WAS NOT INVESTE D IN THE BANK THAT ALONE CANNOT BE A REASON FOR DISALLOWING THE C LAIM OF THE ASSESSEE. SHRI K.A. SUBBIAN, FATHER OF THE ASSESSE E, HAS FILED CONFIRMATION LETTER WHICH EVIDENCES THE GIFT OF ` 46,00,000/-. THEREFORE, IN THE ABSENCE OF ANY FURTHER EXAMINATIO N, THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT NO ADDITION CAN B E MADE IN THE HANDS OF THE PRESENT ASSESSEE. AT THE BEST, IF AT ALL THERE WAS NO SOURCE FOR THE ASSESSEES FATHER, THE ADDITION HAS TO BE MADE ONLY IN THE HANDS OF THE ASSESSEES FATHER AND NOT IN TH E HANDS OF THE PRESENT ASSESSEE. THEREFORE, THE ADDITION OF ` 40,00,000/- FOR THE ASSESSMENT YEAR 2007-08 IS DELETED. 16. NOW COMING TO THE ASSESSMENT YEAR 2008-09, THE ASSESSING OFFICER HAS ESTIMATED UNDISCLOSED INCOME AS ` 45,00,000/-. THE ASSESSEE CLAIMED BEFORE THE ASSESSING OFFICER THAT HE WAS ACTING AS AGENT OF SHRI V.T. ELANGOVAN, KARUR AND THE FUND S OF SHRI V.T. 19 I.T.A. NOS.1505 TO 1509/MDS/14 ELANGOVAN WERE ADVANCED TO VARIOUS PERSONS ON HIS B EHALF. IN SUPPORT OF HIS CONTENTION, THE ASSESSEE PLACED HIS RELIANCE ON THE SEIZED MATERIALS, WHICH WERE MARKED AS KS/B&D/S3, S 10, S12, S13 AND S15. THE ASSESSING OFFICER HIMSELF OBSERVED TH AT IN THESE DOCUMENTS SHRI V.T. ELANGOVAN BROUGHT FUNDS IN THE BUSINESS OF MONEY LENDING. THEREFORE, THE LOOSE SHEETS FOUND I N THE COURSE OF SEARCH OPERATION INDICATE THAT THE FUNDS WERE ADVAN CED BY THE ASSESSEE ON BEHALF OF SHRI V.T. ELANGOVAN. SHRI V. T. ELANGOVAN, IN FACT, ADVANCED FUNDS TO THE ASSESSEE. THE ASSESSIN G OFFICER HAS ALSO FOUND THAT SHRI V.T. ELANGOVAN DIED ON 28.02.2 011 AND HE IS NOT AVAILABLE FOR EXAMINATION. THEREFORE, IT IS OB VIOUS THAT THE DETAILS FOUND IN THE SEIZED MATERIAL COULD NOT BE V ERIFIED BY EXAMINING SHRI V.T. ELANGOVAN. THEREFORE, THE DETA ILS AVAILABLE IN THE SEIZED MATERIAL HAVE TO BE TAKEN AS IT IS IN TH E ABSENCE OF ANY FURTHER EXAMINATION. THIS TRIBUNAL IS OF THE CONSI DERED OPINION THAT REFERENCE FOUND IN THE SEIZED DOCUMENT CANNOT BE IG NORED AT ALL. FROM THE ORDER OF THE ASSESSING OFFICER IT APPEARS THAT THE ASSESSEE HAS RETRACTED HIS EARLIER STATEMENT WITH R EGARD TO BUSINESS OF COVAI BALAJI FINANCE. THE ASSESSEE CLAIMED BEFO RE THE ASSESSING OFFICER THAT THE STATEMENT RECORDED DURIN G THE COURSE OF SEARCH OPERATION WAS THE FIRST ONE TAKEN FROM HIM. THIS TRIBUNAL IS 20 I.T.A. NOS.1505 TO 1509/MDS/14 OF THE CONSIDERED OPINION THAT THIS BEING A SEARCH MATTER UNDER SECTION 153C OF THE ACT, THE MATERIAL FOUND DURING THE COURSE OF SEARCH OPERATION IS MORE RELEVANT THAN THE STATEMEN T RECORDED FROM THE ASSESSEE. SINCE THE MATERIAL FOUND DURING THE COURSE OF SEARCH OPERATION SHOWS THAT THE MONEY WAS GIVEN TO THE ASS ESSEE BY SHRI V.T. ELANGOVAN AND THE ASSESSEE ADVANCED MONEY ON B EHALF OF SHRI ELANGOVAN, THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT THERE CANNOT BE ANY ADDITION IN THE HANDS OF THE PRESENT ASSESSEE. THE ADDITION, IF ANY HAS TO BE MADE, THAT CAN BE MADE O NLY IN THE HANDS OF SHRI ELANGOVAN AND NOT IN THE HANDS OF THE PRESE NT ASSESSEE. THEREFORE, THE ADDITION OF ` 45,00,000/- IS DELETED. 17. NOW FOR THE ASSESSMENT YEAR 2009-10, THE ASSESS ING OFFICER MADE ADDITION OF ` 38,03,653/- BEING INCOME FROM UNDISCLOSED SOURCES. THE ASSESSING OFFICER MAINLY PLACED HIS R ELIANCE ON THE STATEMENT SAID TO BE RECORDED FROM THE ASSESSEE THA T COVAI BALAJI FINANCE IS A PROPRIETORSHIP OF THE ASSESSEE. HOWEV ER, THE SEIZED MATERIAL SHOWS THAT THE MONEY WAS BROUGHT IN BY SHR I V.T. ELANGOVAN. THIS BEING THE BLOCK ASSESSMENT UNDER S ECTION 153C OF THE ACT, SEIZED MATERIAL PLAYS AN IMPORTANT ROLE THAN THE ORAL STATEMENT RECORDED FROM THE ASSESSEE. THE SEIZED M ATERIAL CLEARLY 21 I.T.A. NOS.1505 TO 1509/MDS/14 SHOWS THAT SHRI ELANGOVAN HAS BROUGHT FUNDS IN THE BUSINESS OF MONEY LENDING. THIS MATERIAL FOUND DURING THE COUR SE OF SEARCH OPERATION CANNOT BE IGNORED ON THE BASIS OF RETRACT ED STATEMENT OF THE ASSESSEE. THE FACT REMAINS THAT SHRI V.T. ELAN GOVAN DIED ON 28.02.2011 AND HE IS NOT AVAILABLE FOR EXAMINATION. THEREFORE, THE SEIZED MATERIAL FOUND DURING THE COURSE OF SEARCH O PERATION IS THE ONLY EVIDENCE AVAILABLE ON RECORD. THEREFORE, THE MONEY WAS ADVANCED BY SHRI V.T. ELANGOVAN AND THE ADDITION, I F ANY, HAS TO BE MADE ONLY IN THE HANDS OF SHRI ELANGOVAN AND NOT IN THE HANDS OF THE ASSESSEE. ACCORDINGLY, THE ADDITION OF ` 38,03,653/- MADE BY THE ASSESSING OFFICER IS DELETED. 18. NOW COMING TO THE ADDITION OF ` 7,30,000/-, THE ASSESSING OFFICER MADE THIS ADDITION CONSIDERING THAT THIS IS AN ADDITIONAL CAPITAL AND NO DETAILS WERE AVAILABLE FOR THE ADDIT IONAL CAPITAL. THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT IN THE A BSENCE OF ANY SEIZED MATERIAL WHICH DISCLOSES THE INVESTMENT, THE RE CANNOT BE ANY ADDITION FOR THE BLOCK PERIOD. THE ADDITION HAS TO BE MADE ONLY ON THE BASIS OF SEIZED MATERIAL FOUND DURING THE COURS E OF SEARCH OPERATION. THE BALANCE SHEET FILED IN THE COURSE O F ASSESSMENT PROCEEDING WHICH DISCLOSES THE ADDITIONAL CAPITAL O F ` 7,30,000/- 22 I.T.A. NOS.1505 TO 1509/MDS/14 CANNOT BE TAKEN AS INCOME OF THE ASSESSEE FOR THE B LOCK PERIOD AT ALL. THEREFORE, THE ASSESSING OFFICER IS NOT JUSTI FIED IN MAKING THE ADDITION OF ` 7,30,000/-. 19. NOW COMING TO THE ADDITION OF ` 16,930/-, THE ASSESSING OFFICER FOUND THAT THE ASSESSEE HAS DISCLOSED ` 16,930/- AS INTEREST INCOME. HOWEVER, THE SAME WAS NOT ADDED TO THE TOT AL INCOME. WHEN THE ASSESSEE HAS DISCLOSED THE INCOME OF ` 20,347/- WHICH INCLUDED THE INTEREST INCOME OF ` 16,930/-. THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT FURTHER ADDITION IS NOT JUS TIFIED. THEREFORE, THE ADDITION OF ` 16,930/- IS ALSO DELETED. 20. NOW COMING TO ASSESSMENT YEAR 2010-11, THE FIRS T ADDITION MADE BY THE ASSESSING OFFICER IS WITH REGARD TO ADD ITION OF UNDISCLOSED INCOME TO THE EXTENT OF ` 44,39,908/-. AS OBSERVED EARLIER, THE SEIZED MATERIAL CLEARLY SHOWS THAT THE CAPITAL BROUGHT IN BY SHRI V.T. ELANGOVAN WAS USED FOR MAKING ADVANCE IN THE MONEY LENDING BUSINESS. THE ASSESSEE HAS ALSO RECEIVED G IFT OF ` 40,00,000/- FROM HIS FATHER. THEREFORE, THIS TRIBU NAL IS OF THE CONSIDERED OPINION THAT THE SEIZED MATERIAL FOUND D URING THE COURSE OF SEARCH OPERATION CANNOT BE IGNORED. THIS TRIBUN AL IS OF THE CONSIDERED OPINION THAT THE SEIZED MATERIAL HAS TO BE GIVEN 23 I.T.A. NOS.1505 TO 1509/MDS/14 PREFERENCE RATHER THAN THE STATEMENT SAID TO BE REC ORDED FROM THE ASSESSEE UNDER SECTION 132(4) OF THE ACT. THIS BEI NG THE BLOCK ASSESSMENT, THE ASSESSING OFFICER HAS TO PLACE RELI ANCE ON THE SEIZED MATERIAL WHICH CLEARLY DISCLOSES THE ADVANCE MADE BY SHRI V.T. ELANGOVAN. SINCE THE SAID SHRI V.T. ELANGOVAN IS NOT AVAILABLE FOR EXAMINATION, THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT THE ADDITION MADE IN THE HANDS OF THE PRESENT ASSESSEE IS NOT JUSTIFIED. SINCE THE SEIZED MATERIAL DISCLOSES THE CAPITAL CON TRIBUTED BY SHRI V.T. ELANGOVAN, THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT THE ADDITION, IF ANY, HAS TO BE MADE ONLY IN THE HANDS OF SHRI V.T. ELANGOVAN AND NOT IN THE HANDS OF THE ASSESSEE. 21. NOW COMING TO THE ADDITION OF ` 3,20,000/- BEING THE ADDITIONAL CAPITAL, THE ASSESSING OFFICER MADE THE ADDITION ON THE GROUND THAT THE ASSESSEE HAS NOT PROVIDED ANY DETAI LS WITH REGARD TO ADDITIONAL CAPITAL. THE SEIZED MATERIAL CLEARLY SHOWS THAT SHRI V.T. ELANGOVAN ADVANCED MONEY IN THE MONEY LENDING BUSINESS. THE ASSESSEE HAS ALSO RECEIVED A SUM OF ` 40,00,000/- FROM HIS FATHER. THE ASSESSING OFFICER IGNORING THESE DETAI LS, MADE ADDITION OF ` 3,20,000/-. THEREFORE, THIS TRIBUNAL IS OF THE CON SIDERED OPINION 24 I.T.A. NOS.1505 TO 1509/MDS/14 THAT THE ADDITION OF ` 3,20,000/- IS NOT JUSTIFIED. ACCORDINGLY, THE SAME IS DELETED. 22. NOW COMING TO THE INVESTMENT TO THE EXTENT OF ` 4,50,000/- MADE IN THE PURCHASE OF SWIFT DESIRE CAR, THE ASSES SING OFFICER MADE ADDITION ON THE GROUND THAT THE PURCHASE OF CA R WAS NOT SHOWN IN THE BALANCE SHEET. THIS TRIBUNAL IS OF TH E CONSIDERED OPINION THAT MERELY BECAUSE THE CAR WAS NOT SHOWN I N THE BALANCE SHEET IT DOES NOT MEAN THAT THE ASSESSEE HAS PURCHA SED THE CAR FROM UNDISCLOSED INCOME. THIS TRIBUNAL IS OF THE C ONSIDERED OPINION THAT THE ASSESSEE HAD SOURCE FOR MAKING INVESTMENT. THEREFORE, THE ADDITION OF ` 4,50,000/- WAS NOT JUSTIFIED. ACCORDINGLY, THE SAM E IS DELETED. 23. NOW COMING TO ASSESSMENT YEAR 2011-12, THE FIRS T ADDITION MADE BY THE ASSESSING OFFICER IS ` 30,05,220/-. THE ASSESSING OFFICER MADE THE ADDITION ONLY ON THE BASIS OF THE ADVANCE MADE BY THE ASSESSEE IN THE MONEY LENDING BUSINESS, RELYING ON THE STATEMENT RECORDED UNDER SECTION 132(4) OF THE ACT. THE SEIZED MATERIAL FOUND DURING THE COURSE OF SEARCH OPERATIO N DISCLOSES THAT THE MONEY WAS RECEIVED FROM SHRI V.T. ELANGOVAN OF KARUR FOR MAKING ADVANCE IN THE MONEY LENDING BUSINESS. THIS WAS 25 I.T.A. NOS.1505 TO 1509/MDS/14 EVIDENCED FROM SEIZED MATERIAL FOUND DURING THE COU RSE OF SEARCH OPERATION. SHRI V.T. ELANGOVAN DIED AND NOT AVAILA BLE FOR EXAMINATION. THE ASSESSEE HAS ALSO RETRACTED THE S TATEMENT MADE DURING THE COURSE OF SEARCH OPERATION. THE CLAIM O F THE ASSESSEE THAT HE RECEIVED A SUM OF ` 40,00,000/- FROM HIS FATHER IS ALSO EVIDENCED IN THE AVAILABLE RECORD. IN THOSE CIRCUM STANCES, THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT THERE IS NO JUSTIFICATION IN MAKING THE ADDITION OF ` 30,05,220/- IN THE HANDS OF THE PRESENT ASSESSEE. THIS TRIBUNAL IS OF THE CONSIDERED OPINI ON THAT IF AT ALL ANY ADDITION IS TO BE MADE, IT HAS TO BE MADE IN TH E HANDS OF SHRI V.T. ELANGOVAN AND DEFINITELY NOT IN THE HANDS OF T HE PRESENT ASSESSEE. SIMILARLY, THE ADDITION OF ` 1,10,000/- IS ALSO NOT JUSTIFIED SINCE THE MATERIAL AVAILABLE ON RECORD SUGGESTS THA T THE ADVANCE WAS MADE BY THE ASSESSEE ON BEHALF OF SHRI V.T. ELA NGOVAN WHO, IN FACT, BROUGHT IN THE FUNDS AS CAPITAL. THEREFORE, THE ADDITION OF ` 1,10,000/- IS ALSO DELETED. 24. NOW COMING TO THE UNEXPLAINED INVESTMENT IN PLO T AND HOUSE PROPERTY TO THE EXTENT OF ` 56,70,000/-, THE ASSESSING OFFICER MADE ADDITION ONLY ON THE GROUND THAT THE PLOT AND HOUSE PROPERTY PURCHASED AT COIMBATORE WERE NOT SHOWN IN THE BALAN CE SHEET. 26 I.T.A. NOS.1505 TO 1509/MDS/14 THEREFORE, HE PRESUMED THAT INVESTMENT MADE IN THE PROPERTIES WERE TO BE TREATED AS UNEXPLAINED INCOME. THE HOUS E PROPERTY AT COIMBATORE WAS PURCHASED FROM SHRI V.T. ELANGOVAN F OR ` 31,00,000/-. HOWEVER, THE ASSESSING OFFICER HAS TA KEN THE VALUE AT ` 44,00,000/- ON THE BASIS OF SEIZED MATERIAL KS/B&D/ S-6. WHILE THE ASSESSING OFFICER HAS TAKEN THE PARTICULARS IN THE SEIZED DOCUMENT WITH REGARD TO INVESTMENT, HE HAS NOT TAKE N THE VERY SAME DOCUMENT WITH REGARD TO CAPITAL BROUGHT IN BY SHRI V.T. ELANGOVAN. THIS TRIBUNAL IS OF THE CONSIDERED OPIN ION THAT THE CAPITAL BROUGHT IN BY SHRI V.T. ELANGOVAN AND THE G IFT RECEIVED BY THE ASSESSEE WERE VERY MUCH AVAILABLE ON RECORD. T HE CASH FLOW STATEMENT INDICATES THE AVAILABILITY OF FUNDS WITH THE ASSESSEE. THEREFORE, MERELY BECAUSE THE PURCHASE OF PLOT AND HOUSE PROPERTY IS NOT DISCLOSED IN THE BALANCE SHEET THAT ALONE CA NNOT BE A REASON FOR TREATING THE INCOME AS UNDISCLOSED INCOME. THE AVAILABILITY OF FUNDS WITH THE ASSESSEE IS ESTABLISHED ON THE BASIS OF SEIZED MATERIAL. THEREFORE, MAKING ADDITION IN THE HANDS OF THE ASSESSEE IS NOT JUSTIFIED. IF AT ALL ANY ADDITION HAS TO BE MADE, AT THE BEST, IT CAN BE MADE ONLY IN THE HANDS OF SHRI V.T. ELANGOVA N AND NOT IN THE HANDS OF THE ASSESSEE. THE CAPITAL BROUGHT IN BY SHRI V.T. ELANGOVAN WAS VERY MUCH AVAILABLE WITH THE ASSESSEE . THEREFORE, 27 I.T.A. NOS.1505 TO 1509/MDS/14 THE ASSESSEE CANNOT BE FOUND FAULT FOR NOT DISCLOSI NG THE PURCHASE OF PLOT AND HOUSE PROPERTY IN THE BALANCE SHEET. T HEREFORE, THE ADDITION OF ` 56,70,000/- IS ALSO DELETED. 25. MOREOVER, RECORDING OF SATISFACTION IN RESPECT OF PROCEEDING UNDER SECTION 153C OF THE ACT IS MANDATORY. IN THE CIRCULAR ISSUED BY THE CBDT, WHICH WAS BROUGHT TO THE NOTICE OF THE BENCH BY THE LD. REPRESENTATIVE FOR THE ASSESSEE, CLEARLY SHOWS THAT EVEN IN THE CASE WHERE THE PROCEEDING IS INITIATED UNDER SECTIO N 153C OF THE ACT, RECORDING OF SATISFACTION IS MANDATORY AS REQU IRED UNDER SECTION 158BD OF THE ACT. AT PARA 4 OF THE CIRCULA R, THE CBDT CLARIFIED THAT EVEN IF THE ASSESSING OFFICER IS ONE AND THE SAME, THEN ALSO RECORDING HIS SATISFACTION IS MANDATORY. THE DELHI BENCH OF THIS TRIBUNAL IN SUPER MALLS PVT. LTD. (SUPRA) HAS FOUND THAT THE SATISFACTION HAS TO BE RECORDED BY THE ASSESSING OF FICER IN THE RECORDS OF THE PERSON WHO IS SEARCHED. IN THE CASE BEFORE US, THE SATISFACTION WAS RECORDED IN THE RECORDS OF THE PRE SENT ASSESSEE AND NOT IN THE RECORDS OF THE PERSONS WHO ARE SEARC HED. SINCE SATISFACTION WAS NOT RECORDED IN THE CASE OF SHRI T . MUNIAPPAN, SHRI T. ELANGOVAN AND SHRI V.T. KUMARAVEL WITH REGARD TO DOCUMENT RELATING TO THE PRESENT ASSESSEE, THIS TRIBUNAL IS OF THE CONSIDERED 28 I.T.A. NOS.1505 TO 1509/MDS/14 OPINION THAT THE ASSESSMENT CANNOT STAND ON THAT SC ORE ALSO. IN VIEW OF THE ABOVE, WE ARE UNABLE TO UPHOLD THE ORDE RS OF THE LOWER AUTHORITIES. ACCORDINGLY, THE ORDERS OF THE LOWER AUTHORITIES ARE SET ASIDE. 26. IN THE RESULT, THE APPEALS OF THE ASSESSEE ARE ALLOWED. ORDER PRONOUNCED ON 4 TH MARCH, 2016 AT CHENNAI. SD/- SD/- (. !'# ! ) ( . . . ) (A. MOHAN ALANKAMONY) (N.R.S. GANESAN) % / ACCOUNTANT MEMBER /JUDICIAL MEMBER /CHENNAI, 5 /DATED, THE 4 TH MARCH, 2016. KRI. / -267 87)2 /COPY TO: 1. +, /APPELLANT 2. -.+, /RESPONDENT 3. 1 92 () /CIT(A), TIRUCHIRAPPALLI 4. 1 92 /CIT, CENTRAL-II, CHENNAI 5. 7: -2 /DR 6. ( ; /GF.