Girdharilal Madhyan, Ahmednagar V. DCIT, Central Circle 2(1), Pune

ITA 1625/PUN/2013

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 6965 (ITAT-PUNE)
• Duration Of Justice: 3 year(s) 6 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-03-2017
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Next Hearing Date: 25-01-2017
• Assessment Year: 1996-1997
• Appeal Filed On: 27-08-2013
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: ANIL CHAWARE
• Assessee Lawyers: SUNIL PATHAK
• Keywords: Unexplained investment; Search and seizure; Loose papers; Document seized; Peak credit; Documents seized
• Section: 69C; 143(3); 142(1); 69; 148; 132; 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH A, PUNE , ! , $ BEFORE MS. SUSHMA CHOWLA, JM AND SHRI ANIL CHATURV EDI, AM . / ITA NOS.1618 TO 1625/PUN/2013 & & / ASSESSMENT YEARS : 1989-90 TO 1996-97 SHRI GIRDHARILAL MADHYAN, C/O. M/S.DEEPALI EXHIBITORS, TELIKHUNT, AHMEDNAGAR 414 001 . / APPELLANT PAN: AAWPM0673P VS. THE DY. COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE-2(1), PUNE . RESPONDENT / APPELLANT BY : SHRI SUNIL PATHAK / RESPONDENT BY : SHRI ANIL CHAWARE DATE OF HEARING : 25.01.2017 / DATE OF PRONOUNCEMENT: 08.03.2017 / ORDER PER SUSHMA CHOWLA, JM: THIS BUNCH OF APPEALS FILED BY THE ASSESSEE ARE AG AINST CONSOLIDATED ORDER OF COMMISSIONER OF INCOME TAX (APPEALS)-1, PU NE DATED 21/06/2013 RELATING TO ASSESSMENT YEAR 198990 TO 1996-97 AGAI NST RESPECTIVE ORDERS PASSED UNDER SECTION143(3) R.W.S. 147 & 254 OF THE INCOME TAX ACT 1961 (IN SHORT THE ACT). 2. ALL THE APPEALS RELATING TO THE SAME ASSESSEE WE RE HEARD TOGETHER AND ARE BEING DISPOSED OF BY THIS CONSOLIDATED ORDER FO R THE SAKE OF CONVENIENCE. HOWEVER, REFERENCE IS BEING MADE TO THE FACTS AND I SSUE IN ITA NO.1618/PUN/2013 TO ADJUDICATE THE ISSUES. ITA NOS.1618 TO 1625/PUN/2013 SHRI GIRIDHARILAL MADHYAN 2 3. THE ASSESSEE IN ITA NO.1618/PUN/2013 HAS RAISED THE FOLLOWING ABRIDGED GROUNDS OF APPEAL:- ABRIDGED GROUNDS OF APPEAL: 1] THE LEARNED CIT(A) ERRED IN NOT CONSIDERING THE SEIZED MATERIAL PROPERLY AND ALSO ERRED IN NOT CONFRONTING THE APPE LLANT WITH THE SEIZED MATERIAL. 2] THE LEARNED CIT(A) ERRED IN CONFIRMING THE ADDIT ION ON ACCOUNT OF MONEY LENDING BUSINESS OF RS.3,07,855/- (PARA 4.7). 3] THE LEARNED CIT(A) ERRED IN SUSTAINING THE ADDIT ION ON ACCOUNT OF MONEY LENDING BUSINESS OF USMAN KHAN WRONGLY IN THE HANDS OF THE APPELLANT. ADDITIONAL GROUNDS: 4] THE LEARNED CIT(A) ERRED IN SUSTAINING THE ADDIT ION OF RS.1383/- ON ACCOUNT OF INVESTMENT IN DEEPALI RESTAURANT. 5] THE LEARNED CIT(A) ERRED IN CONFIRMING ADDITION OF RS.15,000/- ON ACCOUNT OF PURCHASE OF DEMAND DRAFT (PARA 5.1) 6] THE APPELLANT CRAVES LEAVE TO ADD, ALTER, AMEND OR DELETE ANY OF THE ABOVE GROUNDS OF APPEAL. 4. BRIEFLY IN THE FACTS OF THE CASE SEARCH AND SEIZ URE ACTION AGAINST THE ASSESSEE UNDER SECTION 132 OF THE ACT WAS CARRIED O UT BETWEEN 11-04-1995 TO 13-04-1995. ACTION UNDER SECTION 132 OF THE ACT WA S ALSO CARRIED OUT AGAINST OTHER PERSONS CONNECTED AND CLOSELY ASSOCIATED WITH THE ASSESSEE. THE PLACE OF THE ASSESSEE WHICH WAS SEARCHED WERE THE RESIDEN CE AT 34/35, S.NO.98, TARAKPUR, AHMEDNAGAR AND THE BUSINESS PREMISES OF M /S. DEEPALI EXHIBITORS, AHMEDNAGAR WHEREIN THE ASSESSEE WAS A PARTNER. DUR ING THE COURSE OF SEARCH AND SEIZURE VOLUMINOUS INCRIMINATING DOCUMENTS, DIA RIES AND EXERCISE NOTE BOOKS, BOOKS OF ACCOUNT AND LOOSE PAPERS WERE FOUND FROM THE RESIDENTIAL PREMISES AS WELL AS THE PREMISES OF M/S. DEEPALI EX HIBITORS. THE ASSESSEE MADE A DECLARATION OF RS.55 LAKHS FOR ASSESSMENT YE AR 1994-1995 TO 1996-97 DURING THE SEARCH PERIOD. THE ASSESSMENTS IN THE C ASE WERE REOPENED FROM ASSESSMENT YEAR 1987-1988 TO 1992-1994 AND NOTICE U NDER SECTION 142(1) OF THE ACT WAS ISSUED FOR ASSESSMENT YEAR 1995-96 AND 1996-1997. THE ITA NOS.1618 TO 1625/PUN/2013 SHRI GIRIDHARILAL MADHYAN 3 ASSESSEE DID NOT FURNISH ANY RETURN OF INCOME IN RE SPONSE TO NOTICE ISSUED UNDER SECTION 148 OF THE ACT, HOWEVER, RETURN OF IN COME FOR ASSESSMENT YEARS 1994-95 TO 1996-97 WERE FILED. ALTHOUGH DURING THE COURSE OF SEARCH THE ASSESSEE HAD MADE A DECLARATION OF RS.55 LAKHS FOR ASSESSMENT YEARS 1994- 95 TO 1996-1997 VIDE LETTER DATED 17-01-1997 THE SA ME WAS RETRACTED. HOWEVER, IN THE SAID LETTER ITSELF, HE AGREED THAT HE IS MENTALLY PREPARED TO OFFER RS.25 LAKHS IN ORDER TO BUY PEACE OF MIND AND SETTL E THE ISSUE AND FILED RETURN OF INCOME ACCORDINGLY. ORIGINAL ASSESSMENTS WERE C OMPLETED UNDER SECTION 144 AND ADDITIONS WERE MADE ON SEVERAL ACCOUNTS IN THE HANDS OF ASSESSEE. 5. THE ASSESSEE PREFERRED AN APPEAL BEFORE THE CIT( A) WHO GRANTED CERTAIN RELIEF TO THE ASSESSEE. THEREAFTER THE ASS ESSEE FILED AN APPEAL BEFORE THE TRIBUNAL WHEREIN THE TRIBUNAL HELD THAT THE ADD ITION RELATING TO MATKA BUSINESS WAS NOT WARRANTED. FURTHER, THE TRIBUNAL SET ASIDE THE ADDITION ON ACCOUNT OF MONEY LENDING BUSINESS SUSTAINED AT RS.1 6,42,576/-, SUSTAINED ADDITION OF PEAK CREDIT AT RS.46,16,982/- AND UNEXP LAINED INVESTMENTS AT RS.33,96,344/- UNDER SECTION 69C AND RESTORED THE M ATTER BACK TO THE FILE OF ASSESSING OFFICER. FURTHER THE NEXT ISSUE DECIDED BY THE TRIBUNAL WAS THE ASSESSEES UNEXPLAINED INVESTMENT IN CONSTRUCTION O F RESIDENTIAL HOUSE WHICH WAS ALSO RESTORED BACK TO THE FILE OF ASSESSING OFF ICER. THE ASSESSING OFFICER THEREAFTER MADE A CONSOLIDATED ORDER FOR ASSESSMENT YEARS 1987-1988 TO 1996-97 AND PASSED RESPECTIVE ORDER FOR THE LATER A SSESSMENT YEARS. IN VIEW THEREOF, CASE OF THE ASSESSEE WAS TAKEN UP FOR SCRU TINY AND THE ASSESSEE WAS ASKED TO FURNISH THE INFORMATION AFTER SUPPLYING TH E PHOTOCOPIES OF THE VARIOUS SEIZED DOCUMENTS. 6. THE FIRST ADDITION WHICH WAS LOOKED INTO WAS THE ADDITION MADE ON ACCOUNT OF PEAK CREDIT INVESTMENTS IN MONEY LENDING BUSINESS AS PER ANNEXURE C WHEREIN ORIGINALLY THE ASSESSING OFFICER MADE A DDITION TOTALING RS.43,42,576/- WHICH WAS SCALED DOWN TO RS.16,42,57 6/- BY THE CIT(A) AND ITA NOS.1618 TO 1625/PUN/2013 SHRI GIRIDHARILAL MADHYAN 4 DURING THE SET ASIDE PROCEEDINGS THE ASSESSEE CLAIM ED THAT THE EVIDENCE ON THE BASIS OF WHICH SAID ADDITION WAS MADE WAS FOUND AND SEIZED FROM THE RESIDENCE OF SHRI USMAN MAQBUL KHAN IN THE FORM OF DIARIES BEARING NO. A7, A12, A13, A14, A17 AND A32 WHICH WAS WRITTEN IN OWN HANDWRITING OF SHRI USMAN MAQBUL KHAN AS ADMITTED BY HIM DURING THE COU RSE OF RECORDING OF STATEMENT UNDER SECTION 132(4) OF THE ACT. THE ASS ESSEE THUS POINTED OUT THAT THE ENTIRE SUSTAINED ADDITION OF RS.16,42,576/- CO ULD NOT BE TAXED IN THE HANDS OF THE ASSESSEE. THE ASSESSING OFFICER NOTED THAT SIMILAR PLEA WAS RAISED BEFORE THE ASSESSING OFFICER AND THE CIT(A) IN THE ORIGINAL ASSESSMENT PROCEEDINGS. HE FURTHER CONTENDS THAT FACTUALLY IT IS NOT CORRECT TO STATE THAT THE IMPUGNED ADDITIONS WERE MADE ONLY ON THE BASIS OF E VIDENCE FOUND AND SEIZED AT THE RESIDENCE OF SHRI USMAN MAQBUL KHAN. ACTUAL LY THE ADDITIONS WERE MADE ON THE BASIS OF EVIDENCE FOUND AND SEIZED FROM THE OFFICE PREMISES OF DEEPALI EXHIBITORS AND THE RESIDENTIAL PREMISES OF THE ASSESSEE. RELEVANT DIARIES WERE FOUND FROM THE PREMISES OF DEEPALI EXH IBITORS AND THE ASSESSEE HIMSELF. FURTHER THE ASSESSING OFFICER NOTED THAT THE DIARIES FOUND AT DIFFERENT PLACES INDICATED THE PERIOD WISE CONTINUATION OF TH E RECORDINGS, NUMBERING, THOUGH FOUND AT DIFFERENT PLACES. THESE DIARIES AC TUALLY PERTAIN TO THE ASSESSEE ONLY. THE ASSESSEE HAD ADMITTED IN THE STATEMENT R ECORDED UNDER SECTION 132(4) THAT HE HAD BEEN EXTENSIVELY INDULGING IN MO NEY LENDING BUSINESS AND THE ORAL EVIDENCE WAS SUPPORTED BY DOCUMENTARY EVID ENCE FOUND IN THE FORM OF NOTINGS IN THE DIARY SEIZED. THE ASSESSING OFFICER ALSO NOTED THAT THE CIT(A) HAD DELETED THE ADDITION OF RS.29,34,875/- ON ACCOU NT OF MONEY LENDING ACTIVITIES CARRIED ON INDEPENDENTLY BY SHRI USMAN K HAN, WHICH INITIALLY WAS MADE IN THE HANDS OF ASSESSEE. THE CIT(A) HAD OPINE D THAT CLOSE STUDY OF THE CONCERNED DIARIES INDICATED THAT THERE WAS POSSIBIL ITY OF SHRI USMAN KHAN RUNNING AND INDEPENDENTLY PARALLEL MONEY LENDING BU SINESS OTHER THAN THE ONE BEING CARRIED ON BY THE ASSESSEE AND HENCE THE CONT ENTION OF THE ASSESSEE THAT THE INCOME IN THE ADDITION PERTAIN TO SHRI USM AN KHAN WAS REJECTED AS THE ITA NOS.1618 TO 1625/PUN/2013 SHRI GIRIDHARILAL MADHYAN 5 ASSESSEE HAD FAILED TO PRODUCE ANY OTHER EVIDENCE I N SUPPORT. IN VIEW THERE OF THE ADDITION OF RS.3,07,855/- IN ASSESSMENT YEARS 1 989-1990, AND RS.13,34,721/- IN ASSESSMENT YEAR 1993-1994 TOTALLI NG RS.16,42,576/- WAS MADE IN THE HANDS OF ASSESSEE. 7. THE SECOND ADDITION MADE WAS ON ACCOUNT OF MONEY LENDING BUSINESS ITSELF, I.E. ADVANCES OF RS.47,71,982/-. THE ASSES SING OFFICER NOTED THAT CIT(A) HAD SUSTAINED ADDITION TO THE EXTENT OF RS.47,71,98 2/- ON ACCOUNT OF VARIOUS DOCUMENTS FOUND FOR THE RESPECTIVE YEARS AS TABULAT ED AT PAGES 6 AND 7 OF THE ASSESSMENT ORDER. THE ASSESSING OFFICER FURTHER NO TED THAT ASSESSEE HAS NOT CONTESTED THE ADDITION OF RS.1,15,181/- IN THE LETT ERS DATED 04-03-2002 AND 11- 03-2002 AND HENCE THE SAME AS CONFIRMED BY THE ASSE SSING OFFICER IN THE SET ASIDE PROCEEDINGS. FURTHER 3 ITEMS AGGREGATING RS. 3,57,000/- WAS SUSTAINED BY THE CIT(A) AND DURING THE SET ASIDE PROCEEDINGS THE ASSESSEE HAD NOT GIVEN ANY EXPLANATION WHATSOEVER IN THIS REGARD. IN VIEW THEREOF THE SAID SUM OF RS.3,57,000/- WAS UPHELD AS ADDITION. RS.1 LAKH IN ASSESSMENT YEAR 1990- 1991, RS.2,50,000/- IN ASSESSMENT YEAR 1991-1992 AN D RS.7,000/- IN ASSESSMENT YEAR 1992-1993 AND FURTHER ADDITION OF R S.10,000/- WAS UPHELD IN ASSESSMENT YEAR 1990-1991. FURTHER REGARDING ADVAN CE OF RS.10 LAKHS AND INTEREST OF RS.90,000/- FOR ASSESSMENT YEAR 1993-19 94 AND RS.4 LAKHS AND INTEREST OF RS.49,776/- THEREON FOR ASSESSMENT YEAR 1994-95 DURING THE SET ASIDE PROCEEDINGS, THE ASSESSEE EXPLAINED THAT THE SAID SHEET DOES NOT CONTAIN THE NAME OF THE ASSESSEE, NEITHER RATE OF INTEREST NOR SECURITY AND IT DOES NOT REFLECT ANY FINANCIAL TRANSACTIONS OF WHETHER THE M ONEY IS RECEIVED OR GIVEN OR OTHERWISE, HENCE THE SAME SHOULD NOT BE CONSIDERED. FURTHER STATEMENT OF ONE SHRI WASIM QURESHI WAS RECORDED WHO DENIED TO HAVE RECEIVED ANY MONEY FROM THE ASSESSEE AMOUNTING TO RS.10 LAKHS OR ANY O THER AMOUNT. IN THE COURSE OF SET ASIDE PROCEEDINGS ALSO THE ASSESSEE A DDUCED SHRI WASIM QURESHI AS HIS WITNESS AND HIS STATEMENTS WAS RECOR DED. HE STATED THAT HE ITA NOS.1618 TO 1625/PUN/2013 SHRI GIRIDHARILAL MADHYAN 6 HAD NO DOCUMENTARY EVIDENCE TO SUBSTANTIATE HIS REP LIES/CONTENTIONS. THE ASSESSING OFFICER WAS OF THE VIEW THAT REPLIES WERE CONTRARY TO WHAT THE SEIZED DOCUMENTS WERE ABOUT AND ALSO THE POST DATED CHEQUE FOR RS.4 LAKHS WAS SIGNED BY HIM. LOAN AMOUNT WAS WRITTEN WITH DATES AND INTEREST CALCULATIONS WAS MADE ON HIS COMPANYS LETTER PAD AND SIGNED BY HIM. YET HE STATED THAT THE TRANSACTION DID NOT MATERIALISE. THE ASSESSING OFFICER THUS UPHELD THE ADDITION OF RS.10 LAKHS ON ACCOUNT OF ADVANCE AND R S.90,000/- ON ACCOUNT OF INTEREST FOR ASSESSMENT YEAR 1993-1994 AND RS.4 LAK HS ON ACCOUNT OF ADVANCE AND RS.49,776/- ON ACCOUNT OF INTEREST FOR ASSESSME NT YEAR 1994-95. 8. THE NEXT ENTRY WAS RS.30,000/- RELATING TO ASSES SMENT YEAR 1994-1995 FOR WHICH THE ASSESSEE EXPLAINED THE TRANSACTION. REJECTING THE SAME THE ADDITION OF RS.30,000/- WAS MADE UNDER SECTION 69 I N THE HANDS OF ASSESSEE. IN RESPECT OF RS.30,000/-, 45,000/- AND RS.5 LAKHS CHEQUES WERE SEIZED FROM THE PREMISES OF THE ASSESSEE. THE CONTENTION OF TH E ASSESSEE THAT THE WRITER OF THE CHEQUE HAD APPROACHED FOR LOAN BUT NO SUCH WAS GIVEN TO HIM AS IT IS NOT ACCOMPANIED BY ANY PROMISSORY NOTE ETC. REJECTING THE CLAIM OF THE ASSESSEE THE ASSESSING OFFICER MADE ADDITION OF RS.30,000/- AS REFERRED ABOVE, RS.45,000/- FOR ASSESSMENT YEAR 1994-1995 AND RS.5 LAKHS FOR ASSESSMENT YEAR 1994-1995. 9. SIMILAR EXPLANATION WAS GIVEN IN RESPECT OF RS.4 ,50,000/- AND THE ADDITION WAS MADE IN THE HANDS OF ASSESSEE REJECTIN G THE EXPLANATION OF THE ASSESSEE. SIMILAR EXPLANATION WAS MADE IN RESPECT OF OTHER BLANK/POST DATED CHEQUES FOUND FOR THE RESPECTIVE YEARS BUT SINCE TH E ASSESSEE FAILED TO SUBSTANTIATE ITS CLAIM THE ADDITION WAS UPHELD IN T HE HANDS OF ASSESSEE ON THE BASIS OF NOTINGS IN THE SEIZED DOCUMENTS AT RS.7,31 ,825/- + RS.4,72,350/- + RS.2,80,000/-. ITA NOS.1618 TO 1625/PUN/2013 SHRI GIRIDHARILAL MADHYAN 7 10. THE NEXT SET OF ADDITION MADE IN THE HANDS OF A SSESSEE WAS ON ACCOUNT OF UNEXPLAINED INVESTMENT AND EXPENSES AT RS.21,35, 540/-. THE ASSESSING OFFICER VIDE PARA 6 AT PAGE 16 ONWARDS HAD CONSIDER ED EACH ITEM OF ADDITION IN THE HANDS OF ASSESSEE FOR THE RESPECTIVE YEARS TOTA LING RS.21,35,540/- WHICH WAS THE UNEXPLAINED INVESTMENT IN SECURITIES/EXPENS ES FOR RENOVATION ETC. WHICH WAS UPHELD IN THE HANDS OF ASSESSEE BY THE CI T(A) AS AGAINST AGGREGATED ADDITION OF RS.37,74,924/- MADE BY THE A SSESSING OFFICER EARLIER. THE SEIZED DOCUMENTS CLEARLY REFLECTED THE TRANSACT ION OF INVESTMENT/EXPENDITURE AND THE ASSESSEE WAS NOT ABL E TO EXPLAIN THE SAME WHEREIN THE ASSESSEE HAD NOT ONLY INVESTED IN CERTA IN SECURITIES BUT ALSO UNDERTAKEN EXPENDITURE BY WAY OF INVESTMENT IN DEEP ALI RESTAURANT AND RESIDENTIAL BUNGALOW IN RESPECTIVE YEARS. 11. THE LAST ITEM WAS ON ACCOUNT OF UNDISCLOSED INV ESTMENT IN GOLD JEWELLERY OF RS.99,425/- AND CASH FOUND AT THE RESIDENCE OF T HE ASSESSEE OF RS.71,494/-. 12. THE NEXT SET OF ADDITION WAS ON ACCOUNT OF CONS TRUCTION OF RESIDENTIAL BUILDING. THE ASSESSEE CLAIMED THAT THE SAID BUILDI NG WAS COMPLETED IN DECEMBER 1996 RELATING TO ASSESSMENT YEAR 1997-1998 AND THE EXPLANATION IN THIS REGARD WAS GIVEN AND WAS RECORDED IN THE ASSES SMENT ORDER PASSED UNDER SECTION 143(3) DATED 23-02-2000. FURTHER IT WAS POI NTED OUT THAT THE SAID HOUSE BELONGS TO 5 JOINT CO-OWNERS WHEREIN THE PLOT WAS P URCHASED IN JUNE 1992 FOR RS.42,25,000/- AND IT WAS ACCOUNTED FOR IN THE BOOK S OF ACCOUNT. FURTHER THE CONSTRUCTION STARTED IN JULY 1992 AND WAS COMPLETED IN DECEMBER 1996 AND WHEN THE CONSTRUCTION WAS GOING ON THE CONSTRUCTION EXPENSES BY THE JOINT CO- OWNERS WERE ACCOUNTED FOR AT RS.21,87,600/- AND FUR THER ACCOUNTED RS.13 LAKHS IN ASSESSMENT YEAR 1996-97 AS PER THE CASH FL OW STATEMENT SUBMITTED DURING THE ASSESSMENT PROCEEDINGS FOR ASSESSMENT YE AR 1997-1998. FURTHER ASSESSEE HAD DECLARED RS.23,80,000/- TOWARDS COST O F CONSTRUCTION IN ASSESSMENT YEAR 1996-97 AND 1997-1998 AND HAD FILED THE DECLARATION UNDER ITA NOS.1618 TO 1625/PUN/2013 SHRI GIRIDHARILAL MADHYAN 8 THE VDIS SCHEME 1996 FOR WHICH NECESSARY CERTIFICAT ION HAS BEEN ISSUED AND PAYMENT OF TAX DUE FOR SAID DECLARATION AT RS.10,20 ,000/- AND THE TOTAL JEWELLERY AMOUNT WAS MADE AT RS.34 LAKHS. THE ASSESSEE FURTH ER POINTED OUT THAT THE DEPARTMENTAL VALUER HAD VALUED COST OF CONSTRUCTION OF HOUSE AT RS.52,45,000/- AND HENCE THE TOTAL COST OF CONSTRUCTION WAS PROPER LY EXPLAINED. THE ASSESSING OFFICER ASKED THE ASSESSEE TO FURNISH TH E BILLS FOR MATERIAL OF CONSTRUCTION OF HOUSE FOR RS.13 LAKHS AND RS.20 LAK HS. THE ASSESSEE EXPLAINED THAT WHERE THE INVESTMENT IN HOUSE FOR CO NSTRUCTION WAS PROPERLY EXPLAINED IN ASSESSMENT YEAR 1997-1998 NO FURTHER Q UESTION TO BE ASKED AT THIS STAGE AS THE CONSTRUCTION OF THE HOUSE IS COVE RED UNDER VDIS DECLARATION 1997. THE ASSESSING OFFICER REJECTED THE EXPLANATI ON OF THE ASSESSEE AND OBSERVED THAT HE HAD NO EVIDENCE TO SUBSTANTIATE TH E CLAIM OF EXPENSES IN ALL AGGREGATING RS.33 LAKHS. HOWEVER, THE ASSESSING OF FICER ALSO FOUND FAULT WITH THE ORDER OF THE ASSESSING OFFICER RELATING TO ASSE SSMENT YEAR 1997-1998 IN DEALING WITH THE ISSUE OF INVESTMENT IN CONSTRUCTIO N IN A GENERAL MANNER AND WITHOUT CARRYING OUT ANY ENQUIRIES. HE FURTHER REF ERRED TO THE ORDER OF CIT(A) WHO HAD HELD THAT THE ASSESSES CLAIM FOR ADJUSTING THE UNACCOUNTED INVESTMENT MADE TOWARDS COST OF CONSTRUCTION TO THE EXTENT OF RS.22,62,000/- DECLARED SUBSEQUENTLY IN VDIS 1997 WAS NOT ACCEPTAB LE AS IT WAS NOT CONCERNED WITH UNEXPLAINED COST OF CONSTRUCTION FOU ND ON THE DATE OF SEARCH. ACCORDINGLY, THE ADDITION OF RS.22,62,000/- WAS MAD E. THE ASSESSING OFFICER THEREAFTER COMPUTED THE INCOME FOR THE RESPECTIVE A SSESSMENT YEARS SEPARATELY. 13. THE CIT(A) TOOK NOTE OF THE VARIOUS DOCUMENTS F OUND AT THE OFFICE OF DEEPALI EXHIBITORS, AT THE RESIDENCE OF THE ASSESSE E AND AT THE RESIDENCE OF SHRI USMAN KHAN WHICH ARE TABULATED UNDER PARA 4.3 AT PAGE 9 OF THE APPELLATE ORDER. THE CIT(A) ALSO REFERRED TO THE INCRIMINATI NG DOCUMENTS FOUND IN THE FORM OF POST DATED CHEQUES, DEMAND DRAFTS, PAY-IN-S LIPS, LOOSE SHEETS ETC. ITA NOS.1618 TO 1625/PUN/2013 SHRI GIRIDHARILAL MADHYAN 9 WHICH WAS SEIZED FROM THE RESIDENCE AND BUSINESS PR EMISES OF THE ASSESSEE WHICH DEMONSTRATED THAT THE ASSESSEE WAS ENGAGED IN THE ACTIVITY RELATING TO MONEY LENDING. ALL THESE DOCUMENTS ARE TABULATED A T PAGES 10 TO 12 OF THE APPELLATE ORDER. THE CIT(A) BELOW PARA 4.5 ALSO NOT ED THE CONTENTION OF THE ASSESSEE THAT THE ADDITION ON ACCOUNT OF PEAK INVES TMENTS IN MONEY LENDING WAS ILLEGAL SINCE THESE WERE BASED ON THE DOCUMENTS SEIZED FROM LATE SHRI USMAN KHANS RESIDENCE. THE CIT(A) REFERRED TO THE ENTRIES IN THE SEIZED MATERIAL FOUND AT THE RESIDENCE OF SHRI USMAN KHAN AND NOTED THAT THE SAME WERE CONSOLIDATED IN THE REGISTERS FOUND AT THE PRE MISES OF DEEPALI EXHIBITORS AS REVEALED BY SEIZED DOCUMENTS A4, A8, A10 AND A34 , HENCE THE CONTENTION OF THE ASSESSEE WAS HELD TO BE INCORRECT. THE CIT( A) FURTHER NOTED THAT IT WAS AN ADMITTED FACT THAT SHRI USMAN KHAN WAS WORKING F OR THE APPELLANT AS HIS ACCOUNTANT AND WAS ALSO A PARTNER IN M/S. CHHAYA EX HIBITORS IN WHICH THE ASSESSEE WAS ALSO A PARTNER. IT WAS ALSO ADMITTED BY SHRI USMAN KHAN IN HIS STATEMENT THAT HE WAS TAKING MONEY FROM THE ASSESSE E AND REPAYING AS AND WHEN IT WAS AVAILABLE. FURTHER THE CIT(A) REFERRED TO THE SEIZED DOCUMENT FOUND AT THE RESIDENCE OF THE ASSESSEE, NATRAJ FILE NO.3 ANNEXURE A WHICH WERE WORKING SHEETS OF MONEY LENDING BUSINESS AND W ERE SIGNED BY ASSESSEES SON ON VARIOUS DATES BETWEEN 07-02-1989 TO 24-05-1989. FURTHER DIARY NO.A14 WAS FOUND FROM THE PREMISES OF THE ASS ESSEE WHICH WAS IN CONTINUATION TO DIARY NO.A17 FOUND AT THE RESIDENCE OF SHRI USMAN KHAN WHICH PRIMARILY PROVE THE MONEY LENDING BUSINESS CARRIED ON BY THE ASSESSEE; AND ALSO FOR THE CURRENT PERIOD BOOKS AND DOCUMENTS WER E FOUND FROM THE BUSINESS AND DAILY CASH REPORT WAS FOUND AT HIS RESIDENCE. THE ASSESSEE HAS NOT FILED ANY APPEAL RELATING TO ASSESSMENT YEARS 1987-1988 A ND 1988-1989 AGAINST THE ASSESSMENT ORDERS PASSED BY THE ASSESSING OFFIC ER IN THE SECOND ROUND WHEREIN MAJOR ISSUES PERTAINING TO IMPUGNED ISSUE O F MONEY LENDING PEAK AND OTHER ADDITIONS WERE ELABORATELY DISCUSSED. THE CI T(A) THUS RAISED A QUERY AS TO WHY IT SHOULD NOT BE INFERRED THAT, IN VIEW OF T HE SAME, THE ASSESSEE HAD ITA NOS.1618 TO 1625/PUN/2013 SHRI GIRIDHARILAL MADHYAN 10 ACCEPTED THE FINDINGS RECORDED IN ASSESSMENT YEAR 1 987-1988. IN REPLY, THE LD. AUTHORISED REPRESENTATIVE FOR THE ASSESSEE POI NTED OUT THAT NO ADDITION WAS MADE IN THE HANDS OF ASSESSEE FOR THOSE YEARS, HENCE NO APPEAL. THE CIT(A) REJECTING THE CLAIM OF THE ASSESSEE UPHELD T HE PEAK INVESTMENT IN MONEY LENDING AS WORKED OUT BY THE ASSESSING OFFICE R. 14. SIMILARLY THE ADDITION MADE ON ACCOUNT OF INVES TMENT IN SECURITIES WAS PARTLY UPHELD UNDER SECTION 69C OF THE ACT. IN RES PECT OF INVESTMENT IN RENOVATION OF DEEPALI RESTAURANT THE ASSESSEE POINT ED OUT THAT DURING THE COURSE OF SET ASIDE PROCEEDINGS HE HAD CONTENDED TH AT SINCE NO DOCUMENTS WERE SEIZED FROM HIS PREMISES AND THE EXPENDITURE H AD BEEN INCURRED BY SHRI HARISH G. MADHYAN THE AMOUNTS IN QUESTION COULD NOT BE ASSESSED IN HIS HAND. SIMILAR CONTENTIONS WERE MADE IN RESPECT OF PAPERS SEIZED FROM THE RESIDENCE OF SHRI D.P. NARANG. THE ASSESSING OFFICER HAD NOT ACCEPTED THE CONTENTION OF THE ASSESSEE AS NO PROOF WAS BROUGHT ON RECORD THAT SHRI HARISH G. MADHYAN HAD INCURRED THE EXPENDITURE. THE CIT(A) UPHELD TH E ORDER OF THE ASSESSING OFFICER AS NO EVIDENCE WAS BROUGHT ON RECORD EITHER TO SHOW THAT SHRI HARISH G. MADHYAN HAD DECLARED ANY INCOME ON ACCOUNT OF DEEPA LI CANTEEN/RESTAURANT OR HAD SHOWN THE INVESTMENT IN HIS BOOKS WHICH ACCO RDINGLY STOOD EXPLAINED AND AGAINST WHICH HEAVY EXPENSES COULD BE INCURRED. THE ASSESSEE WAS ASKED BY THE CIT(A) TO FILE THE DETAILS OF WITHDRAW AL BY SHRI HARISH G. MADHYAN, HOWEVER, NO SUCH DETAILS WERE FILED AND CONSEQUENTL Y THE ADDITION MADE ON ACCOUNT OF INVESTMENT IN DEEPALI CANTEEN WAS UPHELD IN THE HANDS OF ASSESSEE. 15. THE NEXT ADDITION WAS ON ACCOUNT OF INVESTMENT IN HOUSE CONSTRUCTION WHICH WAS ALSO UPHELD IN THE HANDS OF ASSESSEE. TH E CIT(A) DEALT WITH EACH OF THE YEARS SEPARATELY AND ELABORATELY CONSIDERED THE SAME ON ACCOUNT OF INVESTMENT IN MONEY LENDING, SECURITIES, INVESTMENT IN CONSTRUCTION OF DEPALI ITA NOS.1618 TO 1625/PUN/2013 SHRI GIRIDHARILAL MADHYAN 11 RESTAURANT, AND IN RESIDENTIAL BUNGALOW AND ALSO MA RRIAGE EXPENSES FOR TWO YEARS AND UPHELD THE ADDITIONS AGAINST WHICH THE AS SESSEE IS IN APPEAL. 16. THE ASSESSEE IS IN APPEAL AGAINST THE ORDER OF CIT(A). 17. THE LD. AUTHORISED REPRESENTATIVE FOR THE ASSES SEE REFERRED TO THE ABRIDGED GROUNDS OF APPEAL AND THE ADDITIONAL GROUN DS OF APPEAL FILED. HE MADE A REFERENCE TO THE TABULATED CHART FILED IN RE SPECT OF EACH OF THE ADDITION YEAR-WISE AND POINTED OUT THAT THE ASSESSEE WAS OPE RATING FROM AHMEDNAGAR WHERE HE HAD TWO THEATRES IN THE NAME OF DEEPALI AN D CHHAYA AND ASSESSEE ADMITTEDLY WAS INVOLVED IN MONEY LENDING BUSINESS. DURING THE COURSE OF SEARCH ON 11-04-1995 VARIOUS PAPERS RELATING TO MON EY LENDING BUSINESS OF THE ASSESSEE WERE FOUND. HE ADMITTED THAT EXPLANATION IN RESPECT OF THE VARIOUS ADDITIONS WAS GIVEN. HE REFERRED TO PAGE 9 OF THE ORDER OF CIT(A) WHEREIN DETAILS OF DIARIES AND PAPERS FOUND AT HIS RESIDENCE ARE TABULATED. SIMILARLY THE DIARIES FOUND AT DEEPALI OFFICE ARE A LSO TABULATED WHICH CONTAIN SOME DIARIES OF SHRI USMAN KHAN. EVEN AT HIS RESID ENCE NUMBER OF PAPERS WERE FOUND. THE CONTENTION OF THE ASSESSEE BEFORE US WAS THAT THE TRANSACTION ON SUCH PAPERS WHICH ARE FOUND FROM THE POSSESSION OF SHRI USMAN KHAN SHOULD NOT BE TAXED IN THE HANDS OF ASSESSEE. HE A LSO REFERRED TO THE STATEMENT OF SHRI USMAN KHAN IN THIS REGARD. THE L D. AUTHORISED REPRESENTATIVE FOR THE ASSESSEE FAIRLY ADMITTED THA T THE ASSESSEE WAS NOT QUESTIONING THE QUANTIFICATION OF INCOME BASED ON T HE PAPERS FOUND FROM THE ASSESSEES RESIDENCE, HIS BUSINESS ADDRESS AND FROM THE RESIDENCE OF SHRI USMAN KHAN. HE ALSO POINTED OUT THAT NO SEIZED MAT ERIAL WAS AVAILABLE WITH THE ASSESSEE, HOWEVER, SINCE SHRI USMAN KHAN HAD AD MITTED THAT HE WAS ALSO CARRYING ON MONEY LENDING BUSINESS, THE INCOME OF T HE DOCUMENTS RELATING TO HIM SHOULD NOT BE ADDED IN THE HANDS OF ASSESSEE. IN RESPECT OF THE ADDITION ON ACCOUNT OF INTEREST ON MONEY LENDING BUSINESS WH ICH IS ADDED IN ALL THE YEARS THE LD. AUTHORISED REPRESENTATIVE FOR THE ASS ESSEE POINTED OUT THAT PART ITA NOS.1618 TO 1625/PUN/2013 SHRI GIRIDHARILAL MADHYAN 12 OF THE INTEREST MAY BE PERTAINING TO SHRI USMAN KHA N AND THE SAME SHOULD BE EXCLUDED. 18. REFERRING TO THE ADDITION MADE BY THE ASSESSING OFFICER AND CIT(A) AT RS.61.76,883/- THE LD. AUTHORISED REPRESENTATIVE FO R THE ASSESSEE POINTED OUT THAT THE SAME COMPRISED OF PEAK CREDIT ADDITION OF RS.3,07,855/- FOR ASSESSMENT YEAR 1989-1990 AND RS.13,34,072/- AS PEA K CREDIT FOR ASSESSMENT YEAR 1993-94. AS PER THE LD. AUTHORISED REPRESENTATIVE FOR THE ASSESSEE THE ADDITION IN THE HANDS OF ASSESSEE WAS NOT JUSTIFIED AS THE ASSESSEE HAD NO CONNECTION WITH THE MONEY LENDING B USINESS OF SHRI USMAN KHAN. THE LD. AUTHORISED REPRESENTATIVE FOR THE AS SESSEE POINTED OUT THAT GROUNDS OF APPEAL NO.1 IN ALL THE APPEALS WAS NOT P RESSED. HE FURTHER POINTED OUT THAT GROUNDS OF APPEAL NO. 2 AND 3 IS AGAINST E STIMATION OF ADDITION ON ACCOUNT OF MONEY LENDING BUSINESS IN THE HANDS OF A SSESSEE AND HE AGAIN REITERATED THAT THE INCOME FROM BUSINESS RELATING T O SHRI USMAN KHAN SHOULD BE EXCLUDED. 19. WITH REGARD TO ADDITIONAL GROUNDS OF APPEAL THE LD. AUTHORISED REPRESENTATIVE FOR THE ASSESSEE POINTED OUT THAT TH E FACTS WERE ON RECORD AND THE ADDITIONAL GROUNDS OF APPEAL MERITS TO BE ADMIT TED. WITH RESPECT TO GROUND OF APPEAL NO.4, I.E. ADDITIONAL GROUND OF APPEAL NO .1 HE CLAIMED THAT THE ADDITION MADE ON ACCOUNT OF INVESTMENT IN DEEPALI R ESTAURANT SHOULD NOT BE MADE IN THE HANDS OF ASSESSEE AS THE SAID RESTAURAN T WAS BEING RUN BY HIS SON. THE LICENSE TO RUN THE RESTAURANT WAS IN THE NAME OF THE ASSESSEES SON, SO RENOVATION EXPENSES, IF ANY, SHOULD HAVE BEEN AD DED IN THE HANDS OF HIS SON. WITHOUT PREJUDICE TO HIS ARGUMENTS THE LD. AU THORISED REPRESENTATIVE FOR THE ASSESSEE POINTED OUT THAT IN ANY CASE THE ADDIT ION MADE ON ACCOUNT OF MONEY LENDING BUSINESS WAS THE MONEY AVAILABLE AND THE ADDITION ON ACCOUNT OF INVESTMENT IN DEEPALI RESTAURANT, IF ANY, MAY BE SET OFF AGAINST THE AFORESAID ADDITION. ITA NOS.1618 TO 1625/PUN/2013 SHRI GIRIDHARILAL MADHYAN 13 20. NOW COMING TO THE NEXT ADDITION MADE ON ACCOUNT OF INVESTMENT IN RESIDENTIAL BUNGALOW WHICH ADMITTEDLY WAS OWNED BY 5 PERSONS THE LD. AUTHORISED REPRESENTATIVE FOR THE ASSESSEE IN THIS REGARD POINTED OUT THAT ONCE AN ASSET IS BEING OWNED BY 5 PERSONS WHEREIN AS PER THE REPORT OF THE DVO THE TOTAL COST OF THE PROPERTY INCLUDING COST OF THE PL OT WAS RS.56,80,000/-, THEN ADDITION, IF ANY, MERITS TO BE MADE TO THE EXTENT O F 1/5 TH SHARE IN THE PROPERTY. THE ASSESSEE IN THIS REGARD POINTED OUT THAT SUM OF RS.23,80,000/- WAS DECLARED UNDER VDIS 1997 SCHEME AND ONLY BALANCE AM OUNT OF RS.33 LAKHS WAS TO BE EXPLAINED BY THE ASSESSEE. THE CIT(A) ON THE OTHER HAND NOTED THAT THE OTHER CO-OWNERS HAD DECLARED ONLY RS.19,11,000/ - OUT OF RS.33 LAKHS AND THEREFORE THE CIT(A) SUSTAINED ADDITION OF RS.13,89 ,000/- IN THE HANDS OF ASSESSEE AS UNEXPLAINED INVESTMENT. THE ASSESSEE I S AGGRIEVED AND CLAIMED THAT ONLY 1/5 TH OF RS.13,89,000/- AS AGAINST RS.23,80,000/- HAS TO BE TAXED IN THE HANDS OF THE ASSESSEE. WITHOUT PREJUDICE TO TH E ABOVE HE FURTHER POINTED OUT THAT IN CASE ADDITION ON ACCOUNT OF MONEY LENDI NG BUSINESS IS SUSTAINED, THEN SET OFF OF THE SAME SHOULD BE GIVEN AGAINST TH E EXPENDITURE. 21. THE LD. DEPARTMENTAL REPRESENTATIVE FOR THE REV ENUE PLACED RELIANCE ON THE ORDER OF THE CIT(A) AND POINTED OUT THAT HE HAD ELABORATELY CONSIDERED THE ISSUE AND GIVEN THE RELIEF WHEREVER IT WAS POSSIBLE . 22. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE RECORD. SEARCH AND SEIZURE ACTION U/S.132(1) OF THE ACT WAS CARRIE D OUT ON THE PREMISES OF THE ASSESSEE ON 11-04-1995. DURING THE COURSE OF SEARC H AT THE RESIDENCE OF THE ASSESSEE AND ALSO AT THE BUSINESS PREMISES, I.E. OF FICE OF DEEPALI EXHIBITORS, VARIOUS INCRIMINATING DOCUMENTS WERE FOUND AND SEIZ ED. THE LIST OF THE DOCUMENTS SEIZED ON BASIS OF WHICH ADDITION WAS WAR RANTED ARE TABULATED AT PAGE 9 OF THE ORDER OF CIT(A) IN ADDITION TO SEARCH ON THE PREMISES OF THE ASSESSEE. SIMULTANEOUS SEARCH ACTION WAS TAKEN ON OTHER RELATED PERSONS AND ONE SUCH PERSON WAS SHRI USMAN KHAN. HE WAS THE AC COUNTANT OF THE ITA NOS.1618 TO 1625/PUN/2013 SHRI GIRIDHARILAL MADHYAN 14 ASSESSEE BUT WAS ALSO ENGAGED IN MONEY LENDING BUSI NESS ON A SMALL SCALE FROM ASSESSMENT YEAR 1991-1992. THE SAID FACT IS C LEAR FROM THE STATEMENT OF SHRI USMAN KHAN. THE ASSESSING OFFICER AND THE CIT (A) HAVE ELABORATELY CONSIDERED EVIDENCE FOUND DURING THE COURSE OF SEAR CH AND QUANTIFIED THE INCOME FROM MONEY LENDING BUSINESS IN THE HANDS OF ASSESSEE FROM YEAR TO YEAR. THE LD. AUTHORISED REPRESENTATIVE FOR THE AS SESSEE HAS FAIRLY ADMITTED THAT THERE IS NO DISPUTE AS TO THE QUANTIFICATION O F THE INCOME YEAR-WISE. SIMILARLY ADDITIONS HAVE BEEN MADE ON ACCOUNT OF IN VESTMENT IN DEEPALI RESTAURANT, RESIDENTIAL BUNGALOW AND ON ACCOUNT OF UNEXPLAINED INVESTMENT/EXPENDITURE AND MARRIAGE EXPENSES AGAINS T WHICH INCRIMINATING DOCUMENTS WERE FOUND AND SEIZED. THE LD. AUTHORISE D REPRESENTATIVE FOR THE ASSESSEE HAS FAIRLY CONCEDED THAT THE QUANTIFICATIO N OF THE SAID INVESTMENT/EXPENDITURE IN THE HANDS OF ASSESSEE IS NOT DISPUTED. THE YEAR- WISE TABULATED DETAILS OF THE SUMMARY OF ADDITIONS IN THE HANDS OF ASSESSEE ARE AS UNDER : SR. NO PARTICULARS 1996 - 97 1995-96 1994-95 1993-94 1992 - 93 1991-92 1990 - 91 1989-90 TOTAL REMARK (A.Y.) (A.Y.) (A.Y.) (A.Y.) (A.Y.) (A.Y.) (A.Y.) (A.Y.) 1 MONEY LENDING PEAK CREDIT AND INTEREST 752350 872181 1210600 2620897 (INCLUDES PEAK CREDIT RS.13,34, 072/-) 32000 271000 110000 307855 (PEAK CREDIT) 6176883 AS PER NOTE ATTACHED (PARA 1) 2 INVESTMENT IN DEEPALI RESTAURANT 826790 1470 1383 829643 AS PER NOTE ATTACHED (PARA 2) 3 INVESTMENT IN RESIDENTIAL BUNGALOW 138000 1200000 800000 2138000 AS PER NOTE 4 UNEXPLAINE D INVESTMENT EXPENDITURE 140919 (JEWELLE RY & CASH) 59232 (DONATION S +HOTEL BILLS) 111000 (BANK WITHDRAW AL + DONATION) 15000 (D.D.) 326151 AS PER NOTE ATTACHED (PARA 4) 5 MARRIAGE EXPENSES 238685 161315 400000 AS PER NOTE ATTACHED (PARA 5) 23. TAKING UP THE FIRST ISSUE OF ADDITION ON ACCOUN T OF MONEY LENDING BUSINESS, THE MAIN PLANK OF ARGUMENT OF THE ASSESSE E BEFORE US, WAS THAT THE INCOME RELATING TO SHRI USMAN KHAN SHOULD BE EXCLUD ED FROM THE HANDS OF ITA NOS.1618 TO 1625/PUN/2013 SHRI GIRIDHARILAL MADHYAN 15 ASSESSEE. A PERUSAL OF THE ORDER OF CIT(A) REFLECT S THAT SIMILAR CONTENTION WAS RAISED BEFORE THE LOWER AUTHORITIES AND THE ASSESSE E HAD BASED HIS CONTENTIONS ON THE DOCUMENTS FOUND FROM THE POSSESSION OF SHRI USMAN KHAN. THE CIT(A) HAS TAKEN NOTE OF VARIOUS WORKSHEETS WHICH WERE FOU ND FROM SHRI USMAN KHANS RESIDENCE, WORKSHEETS OF MONEY LENDING BUSIN ESS FOUND FROM ASSESSEES PREMISES AND WERE SIGNED BY ASSESSEES S ON ON VARIOUS DATES. THE DIARY WHICH WAS FOUND AT THE OFFICE PREMISES OF DEEPALI EXHIBITORS FOR DIFFERENT PERIODS WAS IN CONTINUATION OF A DIARY WH ICH WAS FOUND AT THE RESIDENCE OF LATE SHRI USMAN KHAN. THE CONCLUSION IN THIS REGARD WAS THAT THE MONEY LENDING BUSINESS WAS PRIMARILY CARRIED ON BY THE ASSESSEE SINCE THE RELEVANT BOOKS AND DOCUMENTS FOR THE CURRENT PERIOD PRIOR TO SEARCH WERE FOUND AT THE ASSESSEES BUSINESS PREMISES AND ALSO DAILY CASH REPORT WAS FOUND AT HIS RESIDENCE. FURTHER IN RESPECT OF CERTAIN YEARS ADDITION WAS MADE ON PEAK CREDIT BASIS. IN THE TOTALITY OF THE ABOVE SAID FA CTS AND CIRCUMSTANCES WE FIND NO MERIT IN THE PLEA OF THE ASSESSEE WHEREIN ADDITI ON ON ACCOUNT OF PEAK CREDIT WAS MADE IN ASSESSMENT YEAR 1989-1990 AT RS.3,07,85 5/- AND RS.13,34,072/- IN ASSESSMENT YEAR 1993-1994; IN THE OTHER YEARS, I .E. ASSESSMENT YEAR 1990- 1991 - RS.1,10,000/-, ASSESSMENT YEAR 1991-92 - RS. 2,71,000/-, ASSESSMENT YEAR 1992-93 - RS.32,000/-, ASSESSMENT YEAR 1993-19 94 RS.12,86,825/-, ASSESSMENT YEAR 1994-95 - RS.12,10,600/-, ASSESSMEN T YEAR 1995-1996 - RS.8,72,181/- AND ASSESSMENT YEAR 1996-1997 - RS.7, 52,350/-, THE ADDITION WAS MADE ONLY ON ACCOUNT OF INTEREST FROM MONEY LEN DING BUSINESS CARRIED ON BY THE ASSESSEE. WE UPHOLD THE ADDITIONS. IN THE TOTALITY OF THE SAME, WE FIND NO MERIT IN THE GROUNDS OF APPEAL NO.2 AND 3 RAISED BY THE ASSESSEE IN ALL THE RESPECTIVE YEARS AND UPHOLDING THE ORDER OF CIT(A) WE DISMISS THE SAID GROUNDS OF APPEAL. ITA NOS.1618 TO 1625/PUN/2013 SHRI GIRIDHARILAL MADHYAN 16 24. NOW COMING TO THE SECOND ADDITION WHICH IS AGI TATED BY THE ASSESSEE, I.E. INVESTMENT IN DEEPALI RESTAURANT IN THREE ASSE SSMENT YEARS TOTALING RS.8,29,643/-. THE ASSESSEE CLAIMS THAT THE SAID R ESTAURANT WAS RUN BY HIS SON, SINCE THE LICENSE TO RUN THE RESTAURANT WAS IN HIS NAME. HOWEVER, THE AUTHORITIES BELOW HAVE POINTED OUT THAT THE ASSESSE E HAS FAILED TO ESTABLISH THE SOURCE AVAILABLE WITH HIS SON TO MAKE THE AFORESAID INVESTMENT AND ALSO THE SON IN ALL THESE YEARS HAS NOT DECLARED ANY INCOME FROM DEEPALI RESTAURANT. ADMITTEDLY THE PREMISES FROM WHICH THE RESTAURANT W AS BEING RUN WAS OWNED BY THE ASSESSEE. IN THE TOTALITY OF THE ABOVE SAID FACTS AND CIRCUMSTANCES WE FIND NO MERIT IN THE CLAIM OF THE ASSESSEE AND ADDI TION OF RS.8,29,643/- IS UPHELD. HOWEVER, WE FIND MERIT IN THE ALTERNATE PL EA RAISED BY THE ASSESSEE THAT THE ADDITION, IF ANY, MAY BE SET OFF AGAINST T HE INCOME ASSESSED IN THE HANDS OF ASSESSEE IN THE RESPECTIVE YEARS ON ACCOUN T OF MONEY LENDING BUSINESS. ACCORDINGLY, WE DIRECT THE ASSESSING OFF ICER TO VERIFY AND COMPUTE THE BALANCE INCOME IN THE HANDS OF ASSESSEE. 25. SIMILARLY IN RESPECT OF INVESTMENT IN RESIDENTI AL BUNGALOW, MARRIAGE EXPENSES, UNEXPLAINED INVESTMENTS/EXPENDITURE THE L D. AUTHORISED REPRESENTATIVE FOR THE ASSESSEE HAS FAIRLY AGREED T O THE QUANTIFICATION OF THE INCOME. IN RESPECT OF THE RESIDENTIAL BUNGALOW, HE CLAIMS THAT HE OWNED ONLY TO THE EXTENT OF 1/5 TH SHARE AND THE BALANCE INVESTMENT IS TO BE MADE BY OTHER CO- OWNERS. HOWEVER, BOTH THE ASSESSING OFFICER AND TH E CIT(A) HAVE COME TO A FINDING THAT THE SOURCE OF INVESTMENT IN THE HANDS OF OTHER CO-OWNERS ARE NOT AVAILABLE TO THE EXTENT THEY HAVE SHOWN THE INVESTM ENT, CREDIT HAS BEEN IN THE HANDS OF ASSESSEE. CONSEQUENTLY, WE FIND NO MERIT IN THE CLAIM OF THE ASSESSEE AND HENCE UPHOLD THE ADDITION ON ACCOUNT O F INVESTMENT IN RESIDENTIAL BUNGALOW IN THE HANDS OF ASSESSEE TO THE TUNE OF RS .21,38,000/- IN RESPECTIVE YEARS. HOWEVER, THE ASSESSING OFFICER IS DIRECTED TO SET OFF THE SAID ADDITION MADE ON ACCOUNT OF MONEY LENDING BUSINESS AS THE SA ME FUNDS ARE AVAILABLE ITA NOS.1618 TO 1625/PUN/2013 SHRI GIRIDHARILAL MADHYAN 17 FOR INVESTMENT. SIMILARLY THE ADDITION MADE ON ACC OUNT OF EXPLAINED INVESTMENTS/EXPENDITURE AND MARRIAGE EXPENSES IS UP HELD IN THE HANDS OF ASSESSEE TO THE TUNE OF RS.3,26,151/- AND RS.4,00,0 00/- RESPECTIVELY. HOWEVER, THE ASSESSEE IS ALLOWED THE BENEFIT OF SET OFF AGAINST THE SAID INCOME FROM MONEY LENDING BUSINESS. ACCORDINGLY, THE ASSE SSING OFFICER IS DIRECTED TO COMPUTE THE INCOME IN THE HANDS OF ASSESSEE IN THE RESPECTIVE ASSESSMENT YEARS AFTER ALLOWING THE SET OFF IN THE INDIVIDUAL ASSESSMENT YEARS. THE ADDITIONAL GROUNDS OF APPEAL THUS RAISED BY THE ASS ESSEE IN EACH OF THE YEARS ARE ALLOWED ON THE ALTERNATE PLEA OF THE ASSESSEE. 26. IN THE RESULT, ALL THE APPEALS OF THE ASSESSEE ARE PARTLY ALLOWED. ORDER PRONOUNCED ON THIS 08 TH DAY OF MARCH, 2017. SD/- SD/- (ANIL CHATURVEDI) (SUSHMA CHOWLA) / ACCOUNTANT MEMBER / JUDICIAL MEMBER / PUNE DATED : 08 TH MARCH, 2017 . SATISH ( )*+ ,+ / COPY OF THE ORDER IS FORWARDED TO : THE APPELLANT; THE RESPONDENT; ' ( # $ ) / CIT-CENTRAL CIRCLE, PUNE; ' ( ) / CIT(A)-12 , PUNE ' **+, +, , / / DR A, ITAT, PUNE; 2 / GUARD FILE. / BY ORDER /7 / + , ITAT, PUNE