SANS INTERNATIOINAL LTD, Pune V. DCIT CIR 2(2), Pune

ITA 1706/PUN/2005

• Counselvise Citation: 170624514 RSA 2005
• Duration Of Justice: 5 year(s) 6 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-05-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2003-2004
• Appeal Filed On: 11-11-2005
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: HARESHWAR SHARMA
• Assessee Lawyers: SUNIL PATHAK
• Keywords: Loose papers; Document seized; Wrong claim; Block assessment; Documents seized
• Section: 132

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH A, PUNE BEFORE SHRI SHAILENDRA KUMAR YADAV, JUDICIAL MEMBER AND SHRI G.S. PANNU, ACCOUNTANT MEMBER I.T.A. NO. 1706/PN/05 (BLOCK ASSTT. YEARS: 1998-99 TO 2003-04) SANS INTERNATIONAL LTD. .. APPELLANT C/O NEERAJ HANDA, CHAIRMAN & MD OF RMEC PROJECTS LTD. 42/9, KALPANA TARANG, KARVE RD, ERANDWANA, PUNE PAN AACCS 3895R VS. DY. COMMISSIONER OF INCOME-TAX, .. RESP ONDENT CEN.CIR 2(2), PUNE AND I.T.A. NO. 1707/PN/05 (BLOCK ASSTT. YEARS: 2000-01 TO 2003-04 PART) PEMCO SERVICES P. LTD. .. APPELLANT HANDA HOUSE, S.NO 275, PALLOD FARM, BANER, PUNE PAN AABCP 6318C VS. DY. COMMISSIONER OF INCOME-TAX, .. RESP ONDENT CEN.CIR 2(2), PUNE APPELLANTS BY: SHRI SUNIL PATHAK RESPONDENT BY: SHRI HARESHWAR SHARMA ORDER PER G.S. PANNU, AM THE CAPTIONED TWO APPEALS HAVE BEEN PREFERRED BY T WO DIFFERENT ASSESSEES BELONGING TO ONE GROUP AND INVOLVE A COMM ON ISSUE AND, THEREFORE, THEY HAVE BEEN HEARD TOGETHER AND A CONSOLIDATED OR DER IS BEING PASSED FOR THE SAKE OF CONVENIENCE AND BREVITY. 2 2. IN BOTH THE APPEALS, THE ISSUE RELATES TO ADDITI ONS MADE IN THE BLOCK ASSESSMENT ON ACCOUNT OF PROFITS STATED TO HAVE BEE N EARNED BY THE APPELLANT COMPANIES WHICH WERE NOT DISCLOSED. THE ADDITIONS H AVE BEEN MADE ON THE BASIS OF DOCUMENT SEIZED DURING SEARCH. IN THE CASE OF PEMCO SERVICES P. LTD. (IN SHORT PEMCO) THE ADDITION IS OF A SUM OF RS 4 5 LAKHS, WHILE IN THE CASE OF SANS INTERNATIONAL LTD. (IN SHORT SANS), THE ADDI TION IS OF A SUM OF RS 40 LAKHS. THE RESPECTIVE ADDITIONS HAVE SINCE BEEN CONFIRMED BY THE COMMISSIONER OF INCOME-TAX (APPEALS) AND HENCE THE PRESENT APPEALS OF THE ASSESSES BEFORE US. 3. THE BRIEF BACKGROUND IS THAT ON 23.7.2002, A SEA RCH AND SEIZURE ACTION UNDER SECTION 132 OF THE INCOME-TAX ACT, 1961 (IN S HORT THE ACT) WAS CARRIED OUT ON ONE SHRI NEERAJ HANDA AND HIS GROUP CONCERNS INC LUDING THE BUSINESS PREMISES OF PEMCO AND SANS, AS ALSO THE RESIDENTIAL PREMISES OF ITS DIRECTORS. SHRI NEERAJ HANDA WAS THE MANAGING DIRECTOR OF A CO NCERN RMEC PROJECTS LTD., AND ONE SHRI JASWINDER SINGH WAS ANOTHER DIRECTOR O F THE SAID COMPANY, WHO WAS LOOKING AFTER THE BRANCH OFFICE AT DELHI. ONE S HRI MOHAR SINGH ASSISTED SHRI JASWINDER SINGH AT DELHI OFFICE. M/S RMEC PROJECTS LTD. WAS ENGAGED IN A CONTRACT FOR SETTING UP OF A PLANT OF M/S OSWAL CHE MICALS AND FERTILIZERS LTD. AT PARADEEP AND SIMILAR OTHER VENTURES. THE BUSINESS O F PEMCO WAS TO LOOK AFTER THE MAINTENANCE OF THE PLANT AND SANS WAS ENGAGED I N SUPPLY OF ELECTRICAL GOODS AT PARADEEP SITE. 4. IN THE COURSE OF SEARCH, A PAPER WAS FOUND AND S EIZED WHICH CONTAINED DETAILS OF EXPENSES INCURRED/RECEIVABLE BY NOIDA OF FICE, A COPY OF WHICH IS PLACED AT PAGE 33 OF THE PAPER BOOK FILED BEFORE US. THIS DOCUMENT WAS FOUND FROM SHRI NEERAJ HANDA AND A COPY OF THE SAME WAS ALSO FOUND WITH SHRI JASWINDER SINGH AND SHRI MOHAR SINGH AT PANIPAT. THE SAID DOCUMENT CONTAINED CERTAIN ITEMS OF EXPENSES CLAIMED TO HAVE BEEN INCURRED/RECEIVABLE B Y NOIDA OFFICE AND THE BONE OF CONTENTION ARE THE TWO ENTRIES, I.E. ITEM NO. 16 AND ITEM NO. 17, WHICH READ AS UNDER: 3 D DETAILS OF EXPENSES INCURRED/RECEIVABLE BY NOIDA OFFICE WHICH YOU HAVE NOT SHOWN IN YOUR STATEMENT AMOUNT (IN RS.) 16 SHARING OF PROFIT OF SANS PARADEEP SITE RS 4000000/2 2000000.00 17 SHARING OF PROFIT OF PEMCO PARADEEP SITE RS 4500000/2 2250000.00 ON THE BASIS OF THE SAID SEIZED DOCUMENT, THE ASSES SING OFFICER INFERRED THAT THE AFOREMENTIONED PROFITS HAVE NOT BEEN DECLARED BY TH E APPELLANT COMPANIES IN THEIR REGULAR RETURNS OF INCOME AND, THEREFORE, THE AMOUNT OF RS 45 LAKHS AND RS 40 LAKHS WAS CONSIDERED AS UNDISCLOSED PROFITS OF PEMCO AND SANS RESPECTIVELY. AS A RESULT THEREOF, THE ASSESSING OFFICER COMPUTED UNDISCLOSED INCOME FOR THE BLOCK ASSESSMENT OF THE APPELLANT COMPANIES, I.E. PEMCO AND SANS AT RS 45 LAKHS AND RS 40 LAKHS RESPECTIVELY. 5. BEFORE US, THE LEARNED COUNSEL FOR THE ASSESSEE EXPLAINED THAT NOIDA OFFICE OF RMEC PROJECTS LTD. WAS BEING LOOKED AFTER BY SHRI JASWINDER SINGH, A DIRECTOR, WHO WAS ASSISTED BY SHRI MOHAR SINGH, ACC OUNTANT AND BOTH OF THEM WERE NOT HAVING CORDIAL RELATIONS WITH SHRI NEERAJ HANDA. AS A RESULT, THEY HAD RAISED SOME FRIVOLOUS DEMANDS AND VIDE LETTER DATED 23.2.2002 THE IMPUGNED SEIZED PAPER WAS SENT TO HEAD OFFICE IN WHICH CERTA IN FRIVOLOUS DEMANDS WERE MADE FROM SHRI NEERAJ HANDA. IN FACT, IT IS POINTED OUT THAT BECAUSE OF THE STRAINED RELATIONSHIP OF SHRI NEERJ HANDA AND SHRI JASWINDER SINGH, A SETTLEMENT TOOK PLACE BETWEEN THEM ON 18.3.2002, MUCH BEFORE T HE DATE OF SEARCH IN TERMS OF WHICH SHRI NEERAJ HANDA PURCHASED THE SHARES OF SHRI JASWINDER SINGH HELD IN M/S RMEC PROJECTS LTD AND ULTIMATELY SHRI JASWIN DER SINGH RETIRED FROM RMEC PROJECTS LTD ALSO. IT WAS ALSO POINTED OUT THA T SHRI JASWINDER SINGH OR SHRI MOHAR SINGH HAD NO SHAREHOLDING IN PEMCO OR SANS NO R WERE THEY DIRECTORS IN ANY OF THESE COMPANIES AND, THEREFORE, THE REFERENC E IN THE SEIZED DOCUMENT TO SHARE OF PROFIT OF PEMCO AND SANS IS QUITE IRRELEVA NT. IT WAS POINTED OUT THAT THE AMOUNTS WERE STATED MERELY BECAUSE THE TWO PERSONS WERE RAISING UNREASONABLE 4 DEMANDS WITH INTENTION TO EXTRACT MONEY FROM SHRI H ANDA. EVEN DURING THE ASSESSMENT PROCEEDINGS, SHRI HANDA HAD EXPLAINED AB OUT THE NOTING ON THIS PAPER AND HE HAD CLARIFIED THAT SUCH CLAIMS WERE B OGUS AND THERE WAS NO QUESTION OF SHARING ANY PROFITS OF PEMCO AND SANS WITH SHRI JASWINDER SINGH BECAUSE HE DID NOT HAVE ANY STAKE IN THESE COMPANIE S. OUR ATTENTION HAS ALSO BEEN DRAWN TO THE ASSESSMENT ORDER CONTAINING REPLY OF SHRI HANDA CLARIFYING AS TO HOW A NUMBER OF NOTINGS IN THE SEIZED MATERIAL A RE EXAGGERATED AND UNREASONABLE AND WITHOUT ANY BASIS. THE LEARNED COU NSEL POINTED OUT THAT THAT EXPLANATION OF SHRI HANDA HAS BEEN ACCEPTED IN RELA TION TO ALL OTHER ENTRIES, BUT ADDITION HAS BEEN MADE ONLY WITH RESPECT TO ITEM NO . 16 AND ITEM NO. 17 REFLECTING THE STATED PROFITS OF PEMCO AND SANS. IN OTHER WORDS, AS PER THE LEARNED COUNSEL, THE ASSESSING OFFICER HAS ACCEPTED THAT OTHER NOTINGS IN THE SEIZED DOCUMENTS ARE NOT GENUINE CLAIMS, BUT ARE FI CTITIOUS CLAIMS MADE BY THE TWO PERSONS, SHRI JASWINDER SINGH AND SHRI MOHAR SI NGH. ACCORDING TO HIM, SIMILAR INFERENCE OUGHT TO HAVE BEEN DRAWN EVEN WIT H REGARD TO THE TWO ENTRIES IN QUESTION. 6. IT HAS ALSO BEEN POINTED OUT THAT THE MINUTES OF BOARD MEETING OF M/S RMEC PROJECTS LTD PLACED IN THE PAPER BOOK AND OTHE R CORRESPONDENCE AT PAGE 37 SHOWING TERMINATION OF SERVICES OF SHRI MOHAR SI NGH CLEARLY SHOW FINANCIAL MIS-MANAGEMENT BY SHRI JASWINDER SINGH AND SHRI MOH AR SINGH IN DELHI OFFICE AND ALL THESE MATERIAL GOES TO SHOW THAT THE SEIZED DOCUMENT WAS NOT A GENUINE DOCUMENT BUT IT WAS PLAYED UP BY SHRI JASWINDER SIN GH MERELY BECAUSE OF STRAINED RELATIONSHIP WITH SHRI HANDA. 7. IN FACT, IT HAS BEEN POINTED OUT THAT SUBSEQUENT LY A STATEMENT OF SHRI JASWINDER SINGH WAS RECORDED ON 8.9.2004 BY THE ASS ESSING OFFICER WHEREIN HE HAS CLARIFIED THAT THE IMPUGNED SEIZED DOCUMENT DOE S NOT REFLECT ACTUAL STATE OF AFFAIRS REGARDING THE PROFITS OF PEMCO AND SANS AND THAT THE SAME WAS PREPARED 5 ONLY WITH THE INTENTION TO HAVE A BETTER BARGAIN WI TH SHRI HANDA AT THE TIME OF HIS SEPARATION FROM RMEC PROJECTS LTD. 8. IT HAS ALSO BEEN POINTED OUT THAT THERE WAS ANOT HER DIRECTOR IN RMEC PROJECTS LTD. BY THE NAME SHRI KIRTANE, WHO WAS ALS O PUT TO SEARCH AND IN HIS STATEMENT, HE CLAIMED THAT THE PROFITS OF SANS MIGH T BE AROUND RS 29.40 LAKHS. AGAIN IT WAS POINTED OUT THAT HE IS NOT CONNECTED T O THE TWO APPELLANT COMPANIES AT ALL BUT IN ANY CASE HE GAVE A VERSION OF THE PRO FIT OF THESE TWO COMPANIES QUITE DIFFERENT FROM THAT GIVEN BY SHRI JASWINDER SINGH A ND SHRI MOHAR SINGH. ALL THESE HAS BEEN POINTED OUT TO JUSTIFY THAT THE IMPUGNED E NTRIES ARE MERE WILD GUESS- WORK OF THESE THREE PERSONS, NAMELY, SHRI JASWINDER SINGH, SHRI MOHAR SINGH AND SHRI KIRTANE AND DID NOT REFLECT ACTUAL PROFITS EARNED BY THE TWO APPELLANT COMPANIES. LASTLY, OUR ATTENTION WAS DRAWN TO PAGES 132 AND 133 OF THE PAPER BOOK WHICH ARE MINUTES OF THE BOARD MEETING OF RMEC LTD., TO SHOW THAT SHRI JASWINDER SINGH AND SHRI MOHAR SINGH HAD INDULGED I N FINANCIAL MALPRACTICES AND FOR THAT REASON SHRI JASWINDER SINGH RETIRED FR OM THE DIRECTORSHIP OF COMPANY OF RMEC LTD AND SERVICES OF SHRI MOHAR SING H WERE TERMINATED. 9. IN THE BACKGROUND OF AFORESAID FACTS, IT HAS BEE N ARGUED THAT THE ASSESSING OFFICER WRONGLY TREATED THE LOOSE PAPERS AS AUTHENTIC SO AS TO HOLD THAT THE IMPUGNED ENTRIES REFLECTED UNDISCLOSED PRO FITS EARNED BY THE APPELLANT COMPANIES. IT HAS ALSO BEEN ARGUED THAT CONSISTENCY IS REQUIRED IN INTERPRETING SEIZED DOCUMENTS, INASMUCH AS THE ASSESSING OFFICER HAS NOT MADE ADDITION ON THE BASIS OF ANY OTHER ENTRIES IN THE SEIZED DOCUME NT, EXCEPT THE TWO ENTRIES IN QUESTION. IN THIS CONTEXT, RELIANCE HAS BEEN PLACED ON FOLLOWING DECISIONS: (I) S.P. GOYAL V DCIT 82 ITD 85 (MUM) (TM) (II) MANGE RAM MITTALV.ACIT 289 ITR (AT) 112 (SB)(D EL) (III) SATNAM SINGH CHHABRA V DCIT 74 TTJ 976 (LUCK ) (IV) CIT V D.K. GUPTA 308 ITR 230 (DEL) 6 10. ON THE OTHER HAND, THE LEARNED CIT-DEPARTMENTAL REPRESENTATIVE VEHEMENTLY DEFENDED THE ADDITIONS IN QUESTION BY ST ATING THAT THE SEIZED DOCUMENT CANNOT BE REGARDED AS A DUMB DOCUMENT AS T HE FIGURES THEREIN PERTAIN TO ITEMS OF EXPENSES/INCOME OF GROUP COMPANIES. ACC ORDING TO THE LEARNED DEPARTMENTAL REPRESENTATIVE, IT CANNOT BE HELD THAT NO ADDITION IS PERMISSIBLE ON THE BASIS OF THE NOTINGS ON THE SEIZED PAPERS, INAS MUCH AS THE NATURE OF THE EXPENSES NOTED THEREIN RELATE TO THE BUSINESS OF GR OUP COMPANIES. IT IS ALSO POINTED OUT THAT THE ADDITIONS IN QUESTION HAVE BEE N MADE BECAUSE THE SAME ARE MAJOR AMOUNTS WHILE THE OTHER ENTRIES ARE OF COMPAR ATIVELY SMALL AMOUNTS AND THE ASSESSING OFFICER HAS BEEN REASONABLE NOT TO MA KE UNREASONABLE ADDITIONS. THE LEARNED DEPARTMENTAL REPRESENTATIVE ALSO POINTE D OUT THAT THOUGH SHRI JASWINDER SINGH AND SHRI KIRTANE, DIRECTORS OF RMEC PROJECTS LTD MAY NOT BE THE SHAREHOLDERS OR DIRECTORS IN THE APPELLANT COMP ANIES, BUT SINCE THEY WERE INVOLVED IN MANAGING OF THE AFFAIRS OF THE TWO COMP ANIES, THEY WOULD HAVE ASKED FOR THEIR SHARE OF THE PROFITS OF THE TWO APPELLANT COMPANIES. THEREFORE, THE PROFITS INDICATED IN THE SEIZED DOCUMENTS IN RELATION TO PE MCO AND SANS CANNOT BE OUTRIGHTLY DISMISSED AS NON-EXISTENT. IN SO FAR AS THE SUBSEQUENT STATEMENT OF SHRI JASWINDER SINGH IS CONCERNED, THE LEARNED DEPA RTMENTAL REPRESENTATIVE POINTED OUT THAT THE SAME IS UNRELIABLE AS IT SEEKS TO SUPPORT THE VERSION OF THE APPELLANT COMPANIES AND IS CONTRARY TO THE DEMAND R AISED BY SHRI JASWINDER SINGH, AS PER THE SEIZED DOCUMENT. IT IS POINTED OU T THAT SIMILAR PAPER WAS FOUND DURING THE SEARCH AT MORE THAN ONE PLACE, I.E. FROM SHRI NEERAJ HANDA FROM PUNE AND SHRI JASWINDER SINGH AND SHRI MOHAR SINGH AT PA NIPAT. IT HAS ALSO BEEN POINTED OUT THAT THE STATEMENT OF SHRI KIRTANE, ANO THER DIRECTOR OF RMEC PROJECTS LTD., ALSO SUPPORTS THE VERSION THAT THERE ARE CERT AIN UNACCOUNTED PROFITS OF THE TWO APPELLANT COMPANIES, ALTHOUGH THE QUANTUM OF SU CH PROFITS AS REFLECTED BY THE SEIZED DOCUMENTS AND THAT STATED BY SHRI KIRTAN E MAY DIFFER. IN ANY CASE, THE 7 PLEA SET UP BY THE LEARNED DEPARTMENTAL REPRESENTAT IVE IS THAT THE IMPUGNED SEIZED DOCUMENT REFLECTS UNACCOUNTED PROFITS OF THE TWO APPELLANT COMPANIES. 11. IN REPLY, THE LEARNED COUNSEL FOR THE ASSESSEE VEHEMENTLY POINTED OUT THAT THE PROFITS OF PEMCO AND SANS STATED IN THE IMPUGNE D SEIZED DOCUMENT IS FICTITIOUS AND IS UNCORROBORATED BY ANY OTHER EVIDE NCE. SECONDLY, IT IS POINTED OUT THAT THE SETTLEMENT WITH SHRI JASWINDER SINGH AND T HE DISMISSAL OF SHRI MOHAR SINGH FROM SERVICE DULY PROVES STRAINED RELATIONS W ITH SHRI NEERAJ HANDA AND ALL THESE EVENTS CANNOT BE TREATED AS AN AFTERTHOUGHT B ECAUSE THE SAME TOOK PLACE PRIOR TO THE DATE OF SEARCH. ACCORDING TO HIM, THE ABOVE EVENTS ESTABLISHE THAT THE IMPUGNED DOCUMENT DID NOT REFLECT ANY GENUINE PROFI TS OF PEMCO AND SANS, BUT WERE FALSE CLAIMS MADE BY SHRI JASWINDER SINGH ON S HRI NEERAJ HANDA. IN THE END, IT WAS SUBMITTED THAT EVEN IF IT WAS ASSUMED T HAT SHRI JASWINDER SINGH HAD RENDERED CERTAIN SERVICES TO THE TWO APPELLANT COMP ANIES, IT WOULD NOT MEAN THAT HE HAD A RIGHT TO SHARE THE PROFITS OF THE APPELLAN T COMPANIES, SINCE HE WAS NEITHER SHAREHOLDER NOR DIRECTOR OF THE APPELLANT C OMPANIES. IT WAS, THEREFORE, SUBMITTED THAT THERE IS NO REASON TO HOLD THAT PROF ITS OF RS 45 LAKHS AND RS 40 LAKHS STATED TO BE THAT OF PEMCO AND SANS RESPECTIV ELY IN THE SEIZED DOCUMENTS WERE UNDISCLOSED INCOMES OF THE APPELLANT COMPANIES . 12. WE HAVE CAREFULLY CONSIDERED THE RIVAL SUBMISSI ONS. THE SUM AND SUBSTANCE OF THE DISPUTE ARISES FROM THE SEIZED DOC UMENT WHICH CONTAINED THE TWO ENTRIES CLAIMED TO BE REPRESENTING PROFITS OF P EMCO AND SANS RESPECTIVELY OF RS 45 LAKHS AND RS 40 LAKHS. THE DOCUMENT IN QUESTI ON WAS SEIZED FROM SHRI NEERAJ HANDA AND IT SHOWS CERTAIN CLAIMS OF EXPENSE S/INCOMES MADE BY SHRI JASWINDER SINGH, WHO WAS LOOKING AFTER THE DELHI OF FICE OF RMEC PROJECTS LTD., A CONCERN BELONGING TO A GROUP OF WHICH THE APPELLANT COMPANIES ARE ALSO A PART. THE MOOT QUESTION IS AS TO WHETHER IT CAN BE INFERR ED THAT THE SEIZED DOCUMENT PROVES THAT THE APPELLANT COMPANIES HAVE EARNED PRO FITS AS STATED THEREIN. SINCE THE DOCUMENT WAS FOUND WITH SHRI NEERAJ HANDA, HE E XPLAINED THAT THE IMPUGNED 8 DOCUMENT CONTAINED CLAIMS RAISED BY SHRI JASWINDER SINGH, ANOTHER DIRECTOR AND SUCH CLAIMS HAVE BEEN FINALLY SETTLED IN THE BOARD MEETING OF RMEC PROJECTS LTD., WHEREBY THE SHAREHOLDING OF SHRI JASWINDER SI NGH WAS BOUGHT BY SHRI NEERAJ HANDA AND SHRI JASWINDER SINGH RETIRED FROM THE DIRECTORSHIP OF RMEC PROJECTS LTD., ALSO. SHRI JASWINDER SINGH ON BEING EXAMINED BY THE ASSESSING OFFICER ALSO CORROBORATED THE VERSION OF SHRI NEERA J HANDA THAT THE TWO ENTRIES IN QUESTION DID NOT REFLECT ANY ACTUAL PROFITS OF THE APPELLANT COMPANIES, BUT WERE MERELY EXAGGERATED CLAIMS MADE BY HIM SO AS TO EXTR ACT MORE MONEY FROM SHRI NEERAJ HANDA AT THE TIME OF SETTLEMENT. THE SETTLEM ENT WITH SHRI JASWINER SINGH IS EVIDENCED BY THE DOCUMENTS ON RECORD, WHICH ALSO INCLUDE THE MINUTES OF THE BOARD MEETING OF RMEC PROJECTS LTD. ALL THESE EVENT S HAVE TAKEN PLACE PRIOR TO THE DATE OF SEARCH AND, THEREFORE, IT CANNOT BE SAI D THAT THE SAME IS NOT BONA FIDE OR IS AN AFTER-THOUGHT. MOREOVER, THE TWO ENTRIES I N QUESTION DO NOT MAKE ANY INTELLIGIBLE INFERENCE, INASMUCH AS THEY DO NOT REF LECT AS TO WHICH PERIOD IT PERTAINS. IT IS ALSO NOT CLEAR AS TO IN WHAT MANNE R SUCH PROFITS HAVE BEEN COMPUTED BY THE AUTHOR OF THE DOCUMENT. UNDER THESE CIRCUMSTANCES, IT IS CLEAR THAT THE TWO ENTRIES ARE UNCORROBORATED AND BALD F IGURES. EVEN THE EXPLANATION RENDERED BY THE ASSESSEE REGARDING THE CLAIM MADE I N THE SEIZED DOCUMENT HAS NOT BEEN FOUND TO BE IN VARIANCE WITH THE FACTUAL A FFAIRS. IN FACT, THE STRAINED RELATIONS BETWEEN SHRI JASWINDER SINGH AND SHRI NEE RAJ HANDA AND THE SUBSEQUENT SETTLEMENT CLEARLY EVIDENCE THAT THE EXP LANATION OF THE ASSESSEE IS REASONABLE. THE CORROBORATION BY SHRI JASWINDER SIN GH IN THE COURSE OF HIS STATEMENT BEFORE THE ASSESSING OFFICER RECORDED ON 8.9.2004 SUPPORTS THE EXPLANATION. THEREFORE, UNDER THESE CIRCUMSTANCES I T CANNOT BE SAID THAT THE SEIZED DOCUMENT SUGGESTED ANY EVIDENCE OF THE APPEL LANT COMPANIES HAVING EARNED PROFITS OTHER THAN THOSE REFLECTED IN THEIR RESPECTIVE FINANCIAL ACCOUNTS. THEREFORE, WE FIND NO REASONS TO AFFIRM THE ORDERS OF THE AUTHORITIES BELOW 9 CONFIRMING THE ADDITIONS OF RS 45 LAKHS AND 40 LAKH S IN PEMCO AND SANS RESPECTIVELY. 13. MOREOVER, AS OBSERVED BY THE HONBLE DELHI HIGH COURT IN THE CASE OF D K GUPTA (SUPRA) THE BURDEN IS ON THE REVENUE TO PROVE ITS VERSION, WHICH IN THE PRESENT CASE, HAVING REGARD TO THE EVIDENCE AND MAT ERIAL ON RECORD, HAS NOT BEEN DISCHARGED BY THE REVENUE. ON THE CONTRARY, AS THE ENTIRE CONSPECTUS OF FACTS SHOW THE EXPLANATION RENDERED BY THE ASSESSEE HAS BEEN MERELY DISBELIEVED AND IT IS NOT A CASE WHERE THE VERSION OF THE ASSESSEE HAS BEEN FOUND TO BE FALSE OR DISPROVED. 14. AFTER CONSIDERING THE ENTIRETY OF CIRCUMSTANCES AS ALSO THE MATERIAL AND EVIDENCE AVAILABLE ON RECORD, WE FIND NO REASONS TO UPHOLD THE CONCLUSION DRAWN BY THE LOWER AUTHORITIES THAT THE TWO IMPUGNED ENTR IES IN THE SEIZED DOCUMENT REFLECT UNDISCLOSED INCOME OF THE APPELLANT COMPANI ES. AS A RESULT, THE RESPECTIVE ORDERS OF THE COMMISSIONER OF INCOME-TAX (APPEALS) ARE SET ASIDE AND THE ASSESSING OFFICER IS DIRECTED TO DELETE THE IMP UGNED ADDITIONS. 15. IN THE RESULT, THE APPEALS OF THE ASSESSEES ARE ALLOWED. PRONOUNCED IN THE OPEN COURT ON THIS 27 TH DAY OF MAY, 2011. SD/- SD/- (SHAILENDRA KUMAR YADAV) (G.S. PANNU) JUDICIAL MEMBER ACCOUNTANT MEM BER PUNE, DATED: 27 TH MAY, 2011 B COPY TO:- 1) ASSESSEES 2) DCIT CEN.CIR. 2(2), PUNE 3) THE CIT (A)-II PUNE 4) THE CIT (C), PUNE 5) THE DR, A BENCH, I.T.A.T., PUNE. 6) GUARD FILE BY ORDER TRUE COPY ASST. REGISTRAR, I.T.A.T., PUNE 10