The ITO, Ward-8(2), Surat V. Shri Ghanshyam Dungarbhai Sutharia, Surat

ITA 1730/AHD/2014

• Counselvise Citation: [2019] 115 COUNSELVISE.COM (IT) 5223 (ITAT-SURAT)
• Duration Of Justice: 4 year(s) 9 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-03-2019
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 30-05-2017
• Assessment Year: 2009-2010
• Appeal Filed On: 05-06-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SRINIVAS T BIDARI
• Assessee Lawyers: J P SHAH SENIOR
• Keywords: Unexplained cash credit; Unexplained investment; Unexplained expenditure; Income from undisclosed sources; Loose papers; Principle of natural justice; Retrospective amendment; Onus to prove; Bogus loan
• Section: 143(3); 133A; 133(6); 250; 274; 208; 68

Judgement Text

GHANSHYAM DUNGARBHAI SUTARIYA V. ACIT-8-SURAT /I.T.A. NO.1615 & 1730/AHD/2014/A.Y.09-10 PAGE 1 OF 52 IN THE INCOME TAX APPELLATE TRIBUNAL, SURAT BENCH, SURAT BEFORE SHRI RAM LAL NEGI, JUDICIAL MEMBER AND SHRI O. P. MEENA, ACCOUNTANT MEMBER I.T.A. NO. 1615 AHD/2014: ASSESSMENT YEAR: 2009-10 SHRI GHANSHYAM DUNGARBHAI SUTARIYA, H.NO.1, IST FLOOR, SAHAJ PARK ROW HOUSE, HIGHER RATE BAUG CIRCLE, VALLABHACHARYA ROAD, NEAR KAILASHDHAM SOCIETY, ASHWANIKUMAR ROAD , SURAT 395008 PAN: AKKPP 9318E VS. ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE-8, SURAT APPELLANT RESPONDENT I.T.A. NO. 1730/AHD/2014: ASSESSMENT YEAR: 2009-10 ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE- 8, SURAT VS. SHRI GHANSHYAM DUNGARBHAI SUTARIYA, H.NO.1, IST FLOOR, SAHAJ PARK ROW HOUSE, HIGHER RATE BAUG CIRCLE, VALLABHACHARYA ROAD, NEAR KAILASHDHAM SOCIETY, ASHWANIKUMAR ROAD , SURAT 395008 PAN: AKKPP 9318E APPELLANT RESPONDENT ASSESSEE BY SHRI J.P. SHAH, SENIOR ADVOCATE REVENUE BY SHRI SRINIVAS T. BIDARI, CIT(D.R.) DATE OF HEARING 27.03.2019 DATE OF PRONOUNCEMENT 06.06.2019 ORDER PER O. P. MEENA, AM 1. THESE ARE CROSS APPEALS BY THE ASSESSEE AND REVENUE WHICH ARE DIRECTED AGAINST THE ORDER OF LEARNED COMMISSIONER OF INCOME TAX (APPEALS)-V, SURAT (IN SHORT THE CIT(A)) DATED 26.03.2014 PERTAINING TO ASSESSMENT YEAR 2009-10, WHICH IN TURN HAS ARISEN FROM THE ASSESSMENT ORDER PASSED UNDER SECTION 143(3) DATED GHANSHYAM DUNGARBHAI SUTARIYA V. ACIT-8-SURAT /I.T.A. NO.1615 & 1730/AHD/2014/A.Y.09-10 PAGE 2 OF 52 29.12.2011 OF INCOME TAX ACT, 1961 (IN SHORT THE ACT) BY THE ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE- 8, SURAT (IN SHORT THE AO). 2. FIRST, WE WILL DEAL WITH THE APPEAL OF THE ASSESSEE IN I.T.A.NO.1615/AHD/2014 A.Y. 2009-10. THE GROUNDS OF APPEAL RAISED AND AS AMENDED VIDE LETTER DATED 23.11.2017 BY THE ASSESSEE ARE AS UNDER: (I) AMOUNT OF RS. 86,44,340/- (1) ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND AS PER LAW, THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) WAS NOT JUSTIFIED CONFIRMING OF ADDITION OF RS.86,44,340/- MADE SOLELY ON THE BASIS OF COMPUTER PRINTOUT WITHOUT ANY EVIDENCE AND IGNORING THE STATEMENT OF SHRI KISHAN SALIA ACCEPTING THE ABOVE TRANSACTION. (2) THE APPELLANT FURTHER SUBMITS THAT THE PRESUMPTION UNDER SECTION 292C OF THE ACT IS REBUTTABLE PRESUMPTION AND THIS HAVING BEEN EFFECTIVELY DISCHARGED BY THE APPELLANT, THERE WAS NO BASIS FOR CONFIRMING THE ABOVE ADDITION. (3) WITHOUT PREJUDICE TO THE ABOVE, THE APPELLANT SUBMITS THAT THE APPELLANT SUBMITTED THAT IF ADDITION IS MADE ON THE BASIS OF COMPUTER PRINT-OUT, THEN THE WHOSE PRINTOUT SHOULD BE SEEN AND OUTGO MENTIONED THEREIN SHOULD ALSO BE CONSIDERED. (II) LOAN OF RS.5,72,000/- (1) ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND AS PER LAW, THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) WAS NOT JUSTIFIED IN MAKING ADDITION OF RS. 5,00,000/- FROM FOUR PERSONS AND INTEREST OF RS. RS. 72,000 THEREOF. (2) THE APPELLANT FURTHER SUBMITS THAT THE PRESUMPTION UNDER SECTION 292C IS REBUTTABLE PRESUMPTION AND THIS HAVING BEEN EFFECTIVELY DISCHARGED BY THE APPELLANT, THERE WAS NO BASIS FOR CONFIRMING THE ABOVE ADDITION. GHANSHYAM DUNGARBHAI SUTARIYA V. ACIT-8-SURAT /I.T.A. NO.1615 & 1730/AHD/2014/A.Y.09-10 PAGE 3 OF 52 (III) ADDITION OF RS. 1,34,86,000/- (1) ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND AS PER LAW, THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) ERRED IN MAKING ADDITION OF RS.1,34,86,000/-. (2) THE APPELLANT SUBMITS THAT THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) MADE THIS ADDITION ON THE GROUND THAT APPELLANT HAD NO EXPLAINABLE SOURCE FOR RETURN OF MONEY TO BUYERS WHEN IT IS CLEAR THAT THE ASSESSEE HAD RECEIVED ADVANCE WHICH WERE AVAILABLE FOR REPAYMENT OF AFOREMENTIONED AMOUNT OF RS. 1,34,86,000/-. (3) THE APPELLANT SUBMITS THAT THE AFOREMENTIONED AMOUNT OF RS. 1,34,86,00 IS REQUIRED TO BE REDUCED BY A SUM OF RS. 86,74,340 NG AMOUNT AVAILABLE AS HAVING BEEN RECEIVED AS PER GROUND NO. I. (4) THE APPELLANT FURTHER SUBMITS THAT THE ABOVE AMOUNT IS FURTHER REQUIRED TO BE REDUCED BY A SUM OF RS. 60,20,000 BEING INTEREST COMPENSATION PAID TO THE BUYERS WHICH IS AN EXCESS OF RS. 74,66,000 RECEIVED FROM THE BUYERS OF THE FLATS AS RS. 60,20,000 IS ADMITTEDLY A DEFINITE OUTGO IN THE AFOREMENTIONED BUSINESS TRANSACTIONS AS HELD BY THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS). (IV) ENHANCEMENT OF INCOME OF RS. 38,90,500/- (1) THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) ERRED IN MAKING ADDITION OF RS. 14,85,000 RECEIVED FROM THE APPELLANT`S WIFE RASILABEN WHEN SHE HAD CONFIRMED SUCH PAYMENTS AND SHE WAS INCOME-TAX ASSESSEE. (2) THE LD. COMMISSIONER OF INCOME-TAX (APPEALS) FURTHER ERRED IN MAKING ADDITION OF RS. 24,05,500 IN RESPECT OF CASH DEPOSITS IN THE BANK ACCOUNT OF THE APPELLANT. (3) WITHOUT PREJUDICE TO THE ABOVE, THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) OUGHT TO HAVE CONSIDERED AVAILABILITY OF CASH OF RS. 10 LACS RECEIVED AS PER PART OF SALE CONSIDERATION OF RS. 1,90,00,000/-. (VI) ADJUSTMENT OF UNACCOUNTED RECEIPTS / UNACCOUNTED EXPENDITURE (1) ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND AS PER LAW, THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) ERRED IN REJECTING THE PLEA OF THE GHANSHYAM DUNGARBHAI SUTARIYA V. ACIT-8-SURAT /I.T.A. NO.1615 & 1730/AHD/2014/A.Y.09-10 PAGE 4 OF 52 APPELLANT TO ADJUST THE ADDITION OF UNACCOUNTED INCOME AGAINST THE ADDITION OF RS. UNACCOUNTED EXPENDITURE AS ADDITION OF UNACCOUNTED INCOME PROVIDED SOURCE FOR UNACCOUNTED EXPENDITURE. (VII) MISCELLANEOUS:- ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND AS PER LAW, NO INTEREST SHOULD BE CHARGED, AS THE ASSESSING OFFICER HAS NOT SPECIFIED TO WHICH INTEREST IS CHARGEABLE. 3. GROUND NO.(I): RELATES TO CONFIRM OF ADDITION OF RS.86,44,340/- ALLEGEDLY BASED ON COMPUTER PRINTOUT. 4. BRIEFLY STATED THE FACTS OF THE CASE ARE THAT A SURVEY UNDER SECTION 133A WAS CONDUCTED IN THE CASE OF THE ASSESSEE ON 26.03.2009. DURING THE COURSE OF SURVEY PROCEEDINGS, BOOKS OF ACCOUNTS/DOCUMENTS FOUND HAVE BEEN INVENTORIED AND IMPOUNDED. THESE PAPERS WERE IN THE NATURE OF CASH MEMO IN WHICH MONTHLY RECEIPTS WERE NOTED THE AO HAS WORKED OUT THE MONTHLY CASH RECEIPTS ON THE BASIS OF THESE CASH MEMO IMPOUNDED DURING THE COURSE OF SURVEY PROCEEDINGS AS UNDER:- SN CASH MEMO TOTAL RECEIPTS 1 APRIL,2008 1,64,12,500 2 MAY 3,38,82,000 3 JUNE 2,95,450 4 JULY 68,21,000 5 AUGUST /SEPTEMBER BACK UP 2,63,69,300 6 SEPTEMBER 59,95,000 7 OCTOBER 1,81,59,000 8 DECEMBER ,2008 1,20,000 9 TOTAL 10,80,54,250 5. THUS, THE TOTAL OF THE CASH RECEIPTS MENTIONED ABOVE IS WORKED OUT AT RS.10, 80, 54, 250. THE ASSESSEE, WAS THEREFORE, ASKED TO FURNISH HIS EXPLANATION WITH REGARD GHANSHYAM DUNGARBHAI SUTARIYA V. ACIT-8-SURAT /I.T.A. NO.1615 & 1730/AHD/2014/A.Y.09-10 PAGE 5 OF 52 TO THE SOURCES OF RECEIPTS SHOWN IN THE ABOVE TABLE. THE SHOW-CAUSE NOTICE ISSUED BY THE AO WAS REPRODUCED IN THE ASSESSMENT ORDER. THE ASSESSEE HAS FILED HIS WRITTEN SUBMISSIONS VIDE LETTER DATED 26.12.2011, WHICH HAVE BEEN REPRODUCED BY THE AO IN THE ASSESSMENT ORDER. THE AO OBSERVED THAT CASH MEMO DESCRIBED IN THE SHOW CAUSE NOTICE WAS A PRINTOUT TAKEN FROM COMPUTER LYING IN THE HOUSE/ PREMISES OF THE ASSESSEE DURING THE COURSE OF SURVEY. THE ASSESSEE HAS CLAIMED THAT THE COMPUTER DOES NOT BELONG TO HIM. IT WAS FURTHER STATED THAT HE IS UNAWARE ABOUT COMPUTER AND HAS DISOWNED THE SAME AS WELL AS PRINTOUTS SO TAKEN. HOWEVER, THE AO NOTED THAT THIS DENIAL BY THE ASSESSEE IS MADE AFTER A LAPSE OF MORE THAN 2 YEARS FROM THE DATE OF SURVEY AND THAT TOO AFTER THE ISSUE OF SHOW CAUSE LETTER. FURTHER, THERE IS NO DENYING THE FACT THE COMPUTER WAS FOUND FROM HIS PREMISES DURING SURVEY. THEREFORE, IN ABSENCE OF ANY EXPLANATION FILED BY THE ASSESSEE, THE CASH RECEIPTS AMOUNTING TO RS.10, 80, 54, 250 WERE HELD PERTAINING THAT THE ASSESSEE. ACCORDINGLY, THE AO HAS ESTIMATED PROFIT @ 8% AT RS.86,44,340 ON TOTAL RECEIPTS OF RS.10,86,54,250/- REFLECTED IN IMPOUNDED DOCUMENTS, AND MADE THE ADDITION ACCORDINGLY. 6. BEING AGGRIEVED, THE ASSESSEE FILED AN APPEAL BEFORE THE LD. CIT(A). IT WAS CONTENDED THAT THE COMPUTER PRINTOUT DOES NOT BELONGS TO HIM. THERE WAS SERIOUS DISPUTE WITH HIS SISTER`S SON, HENCE, HE KEPT THE COMPUTER IN THE ASSESSEE`S PREMISES. THEREFORE, A REMAND REPORT WAS CALLED FOR FROM THE AO. THE AO VIDE HIS REMAND REPORT DTD. 22.01.2013 STATED THAT THE ASSESSEE IN REPLY TO QUESTION NO.13, STATED THAT THESE PAPERS DOES NOT BELONGS TO HIM AND HOW THESE CAME TO HIS HOSE IS NOT KNOWN GHANSHYAM DUNGARBHAI SUTARIYA V. ACIT-8-SURAT /I.T.A. NO.1615 & 1730/AHD/2014/A.Y.09-10 PAGE 6 OF 52 AS HE WAS NOT PRESENT DURING THE COURSE OF SURVEY PROCEEDINGS. HOWEVER, THE AO OBSERVED THAT THE COMPUTER WAS FOUND FROM THE PREMISES OF THE ASSESSEE DURING THE COURSE OF SURVEY PROCEEDINGS. HENCE, HE HAS TO PROVE THAT HOW THE COMPUTER CAME TO HIS PREMISES, BUT THE APPELLANT HAS NOT GIVEN ANY SATISFACTORY REPLY OR EVIDENCES BY WHICH IT CAN BE PROVED THAT THE COMPUTER DOES NOT PERTAINS TO HIM. IT IS CLEARLY PROVED THAT THE APPELLANT HAS MADE A STORY AFTERTHOUGHT. THE AO OBSERVED THAT PROVISIONS OF SECTION 292C (1) OF THE ACT ARE CLEARLY APPLICABLE. THE COPY OF REMAND REPORT OF THE AO WAS MADE AVAILABLE TO THE ASSESSEE. THE ASSESSEE HAS AGAIN REPEATED SAME SUBMISSIONS AS MADE IN APPEAL AND CLAIMED THAT PRINT OUT ARE NOT COGENT EVIDENCE AS PER SECTION 62 OF INDIAN EVIDENCE ACT. HOWEVER, LD. CIT(A) OBSERVED THAT THE DEFINITION GIVEN IN RESPECT OF BOOKS OF ACCOUNTS AS PER PROVISIONS OF SECTION 2(12A) OF INCOME TAX ACT,1961 MEANS BOOKS OF ACCOUNTS INCLUDES LEDGERS, DAY- BOOKS, CASH BOOKS, ACCOUNT-BOOKS AND OTHER BOOKS, WHETHER KEPT IN THE WRITTEN FORM OR PRINT- OUTS OF DATA STORED IN A FLOPPY, DISC, TAPE OR ANY OTHER FORM OF ELECTRO MAGNETIC DATA STORAGE DEVICE. . THEREFORE, CIT(A) OBSERVED THAT THE CONTENTION OF THE ASSESSEE THAT BOOKS OF ACCOUNTS AND OTHER IMPOUNDED MATERIAL DO NOT BELONGS TO HIM AND DOES NOT PERTAINS TO RELEVANT ASSESSMENT YEAR IS DEVOID OF FACTS AND MERITS. THE BOOKS OF ACCOUNTS WERE FOUND AND IMPOUNDED DURING THE COURSE OF SURVEY PROCEEDING. THE DEEMING PROVISIONS OF SECTION 292C(1) LAID DOWN THAT DURING THE SURVEY OR SEARCH, IF ANY BOOKS OF ACCOUNTS FOUND IN POSSESSION OR CONTROL OF ANY PERSON, IS PRESUMED THAT SUCH BOOKS OF ACCOUNTS OR DOCUMENTS BELONGS TO SUCH GHANSHYAM DUNGARBHAI SUTARIYA V. ACIT-8-SURAT /I.T.A. NO.1615 & 1730/AHD/2014/A.Y.09-10 PAGE 7 OF 52 PERSON AND THE CONTENT OF SUCH BOOKS OF ACCOUNTS AND OTHER DOCUMENTS ARE TRUE AND CORRECT. THE LD. CIT(A) HAS ALSO SUPPORTED HIS VIEW BY PLACING RELIANCE IN THE CASE OF ASSTT. CIT V. VATIKA GREENFIELD (P) LTD. [2009] 121 TTJ (DELHI) 208 WHEREIN IT WAS HELD THAT SECTION 292C HAS BEEN AMENDED BY FINANCE ACT, 2007 WITH RETROSPECTIVE EFFECT FROM 1ST OCTOBER 1975 WHEREIN IT IS PRESUME THAT IN THE CASE OF SEARCH OR SURVEY WHEREIN ANY BOOKS OF ACCOUNTS, OTHER DOCUMENTS, MONEY, BULLION, JEWELLERY OR OTHER VALUABLE ARTICLE OR THINGS IS FOUND IN THE POSSESSION OR CONTROL OF ANY PERSON, THEN, IT WOULD BE PRESUMED THAT SUCH BOOKS OF ACCOUNTS, ETC. BELONG TO SUCH PERSON AND ITS CONTENTS ARE TRUE, THERE IS PRESUMPTION OF SIGNATURE AND STAMPING. IN THIS MANNER, ACCORDING TO THE FACTS OF THE PRESENT CASE, A PRESUMPTION HAS BEEN RAISED IN RESPECT OF CORRECTNESS OF THE DOCUMENT IMPOUNDED IN THE COURSE OF SEARCH. THE CIT(A) FURTHER OBSERVED THAT AS PER WELL ESTABLISH LAW AS EXPLAINED BY THE HONOURABLE SUPREME COURT IN THE CASE OF SMT. TARULATA SHYAM V. CIT [1977] 108 ITR 345 (SC) /1977 CTR (SC) 275, THERE IS NO SCOPE FOR IMPORTING INTO THE STATUTE THE WORDS WHICH ARE NOT THERE. THE INTENTION OF THE LEGISLATURE IS PRIMARILY TO GATHER FROM WORDS USED IN THE STATUTE. ONCE THE ASSESSEE COMES WITHIN THE LETTER OF LAW, HE MUST BE TAXED. THE LD. CIT(A) FURTHER PLACED RELIANCE IN THE CASE OF HIREN VASANTLAL SHAH [2012] 19 TAXMANN.COM 241 (GUJARAT) WHEREIN IT WAS HELD THAT SECTION 292C OF INCOME TAX ACT,1961 PRESUMPTION AS TO ASSETS, BOOKS OF ACCOUNTS, ETC. - PURSUANT TO SEARCH AT THE ASSESSEES PREMISES, CERTAIN DOCUMENTS WERE FOUND AND ONE OF SUCH DOCUMENT CONTAINED WORKING INTEREST RATE OF 3 PERCENT ON TOTAL SUM OF RS. 3 GHANSHYAM DUNGARBHAI SUTARIYA V. ACIT-8-SURAT /I.T.A. NO.1615 & 1730/AHD/2014/A.Y.09-10 PAGE 8 OF 52 LAKHS- ASSESSEE WAS DIRECTED TO EXPLAIN CONTENT OF DOCUMENT FOUND DURING COURSE OF SEARCH- ASSESSEE EXPLAINED THAT CONTENTS OF SAID DOCUMENT WERE ROUGH WORKING NO LOAN WAS GIVEN OUT ASSESSING OFFICER REJECTED ASSESSEE`S EXPLANATION WHETHER ON BASIS OF MATERIAL RECOVERED DURING SEARCH , LOWER AUTHORITIES HAD RIGHTLY DRAWN PRESUMPTION IN TERMS OF SECTION 292C HELD , YES WHETHER THEREFORE, , IMPUGNED ADDITION WAS TO BE CONFIRMED HELD- YES [ IN FAVOUR OF THE REVENUE ]. 7. THE LD. CIT(A) FURTHER PLACED RELIANCE IN THE CASE OF ALLIANCE HOTELS V. ACIT [2012] 28 TAXMANN.COM 277 (MUMBAI- TRIB) WHEREIN INCRIMINATING DOCUMENTS WERE RECOVERED FROM ITS PREMISES. DURING THE ASSESSMENT, THE AO HAS MADE CERTAIN ADDITIONS BASED ON CERTAIN COMPUTER PRINTOUTS. DURING APPELLATE PROCEEDINGS BEFORE ITAT, THE TRIBUNAL HELD THAT SECTION 292C PROVIDES FOR A PRESUMPTION AS TO THE TRUTH OF ANY DOCUMENT FOUND DURING SEARCH FOR THE MONEY RECOVERED FROM ASSESSEE IS BELONGING TO THE ASSESSEE. IN VIEW OF THESE FACTS AND DISCUSSION, THE CIT(A) HAS HELD THAT IT IS CLEAR AND EVIDENT THAT THE APPELLANT HAS FAILED TO PRODUCE THE PRIMARY BOOKS OF ACCOUNTS FOR VERIFICATION BEFORE THE ASSESSING OFFICER, IN SPITE OF SEVERAL OPPORTUNITIES. THE CIT(A) OBSERVED THAT THE APPELLANT HAS ALSO RELIED ON FEW CASE LAWS WHICH ARE DISTINGUISHABLE ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND THE RATIO OF THE JUDGEMENT ARE NOT APPLICABLE IN THE INSTANT CASE. THE APPELLANT HAS FAILED TO DISCHARGE THE BURDEN OF PROOF REGARDING THE RECEIPTS FOUND RECORDED IN THE BOOKS OF ACCOUNTS. THE EXPRESSION BURDEN OF PROOF REALLY MEANS TWO DIFFERENT THINGS. IT MEANS SOMETIMES THAT THE PARTY IS REQUIRED TO PROVE AN ALLEGATION BEFORE JUDGEMENT GHANSHYAM DUNGARBHAI SUTARIYA V. ACIT-8-SURAT /I.T.A. NO.1615 & 1730/AHD/2014/A.Y.09-10 PAGE 9 OF 52 CAN BE GIVEN IN IN HIS FAVOUR. IT ALSO MEANS THAT ON A CONTESTED ISSUE, ONE OF THE TWO CONTENDING PARTIES HAS TO INTRODUCE EVIDENCE. IN THE FIRST SENSE, IF THE BURDEN IS NOT DISCHARGED, THE PARTY MUST EVENTUALLY FAIL. IN THE SECOND CASE, WHERE THE PARTIES ARE JOINED THE ISSUE AND HAVE LED EVIDENCE AND THE CONFLICTING EVIDENCE CAN BE WEIGHED TO DETERMINE WHICH WAY THE ISSUE CAN BE DECIDED, THE QUESTION OF BURDEN OF PROOF BECOMES AN ABSTRACT QUESTION AND IS THEREFORE ACADEMIC. THE SECTION 101 TO 114 OF INDIAN EVIDENCE ACT, 1872 DEALS WITH BURDEN OF PROOF. SECTION 102 OF THE EVIDENCE ACT, 1872 PROVIDES THAT THE BURDEN OF PROOF LIES ON THAT PARTY WOULD FAIL, IF NO EVIDENCE AT ALL WERE GIVEN ON EITHER SIDE. THUS, IF AN ASSESSEE CLAIMED THAT MONEY OR BULLION FOUND IN HIS POSSESSION AT THE TIME OF SEARCH OR SURVEY DOES NOT BELONG TO HIM BUT SOMEONE ELSE, THE ONUS IS ON HIM TO ESTABLISH IT BECAUSE THE ORDINARY PRESUMPTION IS THAT HE IS THE OWNER AS THE MONEY ETC. WAS FOUND IN HIS POSSESSION. SIMILARLY, IN ALL CASES WHERE A PARTICULAR RECEIPTS IS SOUGHT BE TAXED AS INCOME, THE INITIAL ONUS IS ON THE ASSESSING OFFICER TO PROVE THAT IT IS TAXABLE. WHERE THERE IS STATUTORY REBUTTABLE PRESUMPTION AGAINST THE ASSESSEE, AS IN THE CASE OF CASH CREDIT ETC. UNDER SECTION 68 OR UNEXPLAINED INVESTMENT UNDER SECTION 69, THE INITIAL BURDEN OF PROOF IS ON THE ASSESSEE TO SHOW THAT THE CASH CREDIT IS GENUINE OR THE INVESTMENT IS NOT UNEXPLAINED. IN THE LIGHT OF ABOVE FACTS AND CIRCUMSTANCES, THE LD. CIT(A) OBSERVED THAT THE APPELLANT HAS BEEN PROVIDED SUFFICIENT OPPORTUNITIES KEEPING IN VIEW OF THE PRINCIPLE OF NATURAL JUSTICE, BUT HE HAS BEEN NOT ABLE TO FURNISH ANY EXPLANATION OR DOCUMENT IN SUPPORT OF HIS CONTENTION. THE APPELLANT HAS ALSO NOT GHANSHYAM DUNGARBHAI SUTARIYA V. ACIT-8-SURAT /I.T.A. NO.1615 & 1730/AHD/2014/A.Y.09-10 PAGE 10 OF 52 PRODUCED ANY BOOKS OF ACCOUNTS; THEREFORE, THE ACTION OF THE AO IN APPLYING 8% OF GROSS PROFIT ON TOTAL CASH RECEIPTS WAS UPHELD. ACCORDINGLY, THE ADDITION OF RS.86,44,340/- WAS CONFIRMED. 8. BEING, AGGRIEVED THE ASSESSEE FILED THIS APPEAL BEFORE THE TRIBUNAL. THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT COMPUTER FROM WHICH PRINT OUT TAKEN MIGHT HAVE BEEN KEPT BY SHRI KISHAN D. SALIYA, SON OF HIS SISTER, WITH WHOM THE ASSESSEE WAS NOT HAVING GOOD RELATIONS. THEREFORE, COMPUTER PRINTOUT TAKEN FROM THE PREMISES OF THE ASSESSEE CANNOT BE TREATED AS BELONGING TO THE ASSESSEE AS PER PROVISION OF SECTION 292C. THE LOOSE PAPER DOES NOT CONTAINS NAME OF THE ASSESSEE. EVEN IF THE ADDITION OF RS.86,44,340 WERE SUSTAINED, THEN THE ENTIRE ADDITION MADE BY THE AO WOULD BE COVERED, AS THIS IS INCOME /PROFIT EARNED BY THE ASSESSEE. LEARNED COUNSEL REFERRED PAPER BOOK PAGE NO.36, WHICH ARE SUBMISSIONS OF THE ASSESSEE DATED 26.12.2011 WHERE THE ASSESSEE HAS DISOWNED THE COMPUTER PRINTOUT. SIMILARLY, THE ASSESSEE HAS VIDE REPLY DATED 05.12.2012 FILED EXPLANATION WITH THE AO. HOWEVER, THE AO HAS MADE ADDITION WITHOUT MAKING FURTHER ENQUIRY. THEREFORE, ADDITION SO MADE WITHOUT CORROBORATING EVIDENCES IS BAD IN LAW. THE LEARNED COUNSEL FOR THE ASSESSEE SUPPORTED HIS ARGUMENT BY PLACING RELIANCE IN THE CASE OF ACIT V. STYAPAL WASSAN [2007] 295 ITR(AT) 352 (JAB). 9. ON THE OTHER HAND, THE LD. CIT (DR) RELYING ON THE ORDERS OF LOWER AUTHORITIES SUBMITTED THAT THE ADDITION HAS BEEN RIGHTLY MADE BY THE AO AND THE LD. CIT(A) HAS GHANSHYAM DUNGARBHAI SUTARIYA V. ACIT-8-SURAT /I.T.A. NO.1615 & 1730/AHD/2014/A.Y.09-10 PAGE 11 OF 52 RIGHTLY UPHELD IT. FURTHER, THE LEARNED COUNSEL FOR THE ASSESSEE IS NOT ABLE TO EXPLAIN THE ENTRIES APPEARING IN IMPOUNDED DOCUMENTS DURING THE COURSE OF SURVEY. THEREFORE, THE LEARNED COUNSEL FOR THE ASSESSEE HAS CLAIMED SET-OFF OF THIS ADDITION AGAINST THE ADDITION IN SUBSEQUENT GROUNDS, WHICH MEANS THE ASSESSEE IS ACCEPTING THAT ADDITION HAS BEEN CORRECTLY SUSTAINED. 10. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE RELEVANT MATERIAL ON RECORD. WE OBSERVE THAT CASH MEMO WAS A PRINTOUT TAKEN FROM COMPUTER FOUND LYING IN THE HOUSE/ PREMISES OF THE ASSESSEE DURING THE COURSE OF SURVEY. THE ASSESSEE HAS DISOWNED SUCH COMPUTER AS WELL AS PRINTOUT OF THE SAME, ON THE GROUND THAT HE WAS UNAWARE THAT WHO HAS PUT THIS COMPUTER IN HIS HOUSE AND ALSO DISOWNED THE COMPUTER PRINTOUTS TAKEN. HOWEVER, WE FIND THAT THIS DENIAL BY THE ASSESSEE WAS MADE AFTER A LAPSE OF MORE THAN 2 YEARS FROM THE DATE OF SURVEY AND THAT TOO AFTER THE ISSUE OF SHOW CAUSE LETTER BY THE AO. HENCE, SAME IS NOT ACCEPTABLE. FURTHER, THE ASSESSEE HAS FAILED TO PROVE THAT HOW THE COMPUTER CAME TO HIS PREMISES NOR HAS GIVEN ANY SATISFACTORY REPLY OR EVIDENCES BY WHICH IT CAN BE PROVED THAT THE COMPUTER DOES NOT BELONGS TO HIM. WE ARE NOT CONVINCED WITH THE THEORY OF THE ASSESSEE THAT SOMEONE ELSE HAD KEPT THE COMPUTER IN THE HOUSE OF THE ASSESSEE WITHOUT HIS KNOWLEDGE. THESE FACTS AND CIRCUMSTANTIAL EVIDENCE LED TO BELIEVE THE ASSESSEE HAS MADE UP THIS STORY, WHICH IS AFTERTHOUGHT. THE ASSESSEE CLAIMED THAT PRINTOUTS ARE NOT COGENT EVIDENCE AS PER SECTION 62 OF INDIAN EVIDENCE ACT. HOWEVER, WE NOTE THAT THE INCOME TAX ACT,1961 IS COMPLETE CODE ITSELF AND THE DEFINITION GIVEN IN RESPECT OF BOOKS OF GHANSHYAM DUNGARBHAI SUTARIYA V. ACIT-8-SURAT /I.T.A. NO.1615 & 1730/AHD/2014/A.Y.09-10 PAGE 12 OF 52 ACCOUNTS IN SECTION 2(12A) OF INCOME TAX ACT,1961 STATES THAT BOOKS OF ACCOUNTS INCLUDES LEDGERS, DAY-BOOKS, CASH BOOKS, ACCOUNT-BOOKS AND OTHER BOOKS, WHETHER KEPT IN THE WRITTEN FORM OR PRINT- OUTS OF DATA STORED IN A FLOPPY, DISC, TAPE OR ANY OTHER FORM OF ELECTRO MAGNETIC DATA STORAGE DEVICE. . THEREFORE, THE CONTENTION OF THE ASSESSEE THAT BOOKS OF ACCOUNTS AND OTHER IMPOUNDED MATERIAL DO NOT BELONGS TO HIM AND DOES NOT PERTAINS TO RELEVANT ASSESSMENT YEAR IS DEVOID OF FACTS AND MERITS. THE BOOKS OF ACCOUNTS WERE FOUND AND IMPOUNDED DURING THE COURSE OF SURVEY PROCEEDING. THE DEEMING PROVISIONS OF SECTION 292C(1) LAID DOWN THAT DURING THE SURVEY OR SEARCH, IF ANY BOOKS OF ACCOUNTS FOUND IN POSSESSION OR CONTROL OF ANY PERSON, IT IS PRESUMED TO THAT SUCH BOOKS OF ACCOUNTS OR DOCUMENTS BELONGS TO SUCH PERSON AND THE CONTENT OF SUCH BOOKS OF ACCOUNTS AND OTHER DOCUMENTS ARE TRUE AND CORRECT. THE LD. CIT(A) HAS ALSO SUPPORTED HIS VIEW BY PLACING RELIANCE IN THE CASE OF ASSTT. CIT V. VATIKA GREENFIELD (P) LTD. [2009] 121 TTJH (DELHI) 208 WHEREIN IT WAS HELD THAT FINANCE ACT, 2007 WITH RETROSPECTIVE EFFECT FROM 1ST OCTOBER, 1975, HAS INSERTED A PROVISION OF SECTION 292C, WHERE PRESUMPTION HAS BEEN LAID DOWN THAT IN THE CASE OF SEARCH OR SURVEY WHEREIN ANY BOOKS OF ACCOUNTS, OTHER DOCUMENTS, MONEY, BULLION, JEWELLERY OR OTHER VALUABLE ARTICLE OR THINGS IS FOUND IN THE POSSESSION OR CONTROL OF ANY PERSON, THEN, IT WOULD BE PRESUMED THAT SUCH BOOKS OF ACCOUNTS, ETC. BELONG TO SUCH PERSON AND ITS CONTENTS ARE TRUE AND THERE IS PRESUMPTION OF SIGNATURE AND STAMPING. THEREFORE, KEEPING THE FACTS OF THE PRESENT CASE IN MIN WE OBSERVED THAT A PRESUMPTION HAS BEEN RAISED IN RESPECT OF CORRECTNESS GHANSHYAM DUNGARBHAI SUTARIYA V. ACIT-8-SURAT /I.T.A. NO.1615 & 1730/AHD/2014/A.Y.09-10 PAGE 13 OF 52 OF THE DOCUMENT IMPOUNDED IN THE COURSE OF SURVEY. WE FIND THAT THAT IT IS ESTABLISH LAW AS EXPLAINED BY THE HONOURABLE SUPREME COURT IN THE CASE OF SMT. TARULATA SHYAM V. CIT [1977] 108 ITR 345 (SC) /1977 CTR (SC) 275, WHEREIN THE HON`BLE SUPREME COURT OBSERVED THAT THERE IS NO SCOPE FOR IMPORTING INTO THE STATUTE THE WORDS WHICH ARE NOT THERE. THE INTENTION OF THE LEGISLATURE PRIMARILY IS TO GATHER FROM WORDS USED IN THE STATUTE. ONCE THE ASSESSEE COMES WITHIN THE LETTER OF LAW, HE MUST BE TAXED. OUR VIEW IS FURTHER SUPPORTED BY THE DECISION OF HON`BLE JURISDICTIONAL HIGH COURT IN THE CASE OF HIREN VASANTLAL SHAH [2012] 19 TAXMANN.COM 241 (GUJARAT) OF WHICH HEAD NOTE READS AS PREMISES, CERTAIN DOCUMENTS WERE FOUND AND ONE OF SUCH DOCUMENTS CONTAINED WORKING OF INTEREST AT RATE OF 3 PER CENT ON TOTAL SUM OF RS. 3 LAKH - ASSESSEE WAS DIRECTED TO EXPLAIN CONTENTS OF DOCUMENT FOUND DURING COURSE OF SEARCH - ASSESSEE EXPLAINED THAT CONTENTS OF SAID DOCUMENT WERE ROUGH WORKING AND NO LOAN WAS GIVEN OUT - ASSESSING OFFICER REJECTED ASSESSEE'S EXPLANATION AND BROUGHT TO TAX PRINCIPAL AMOUNT OF RS. 3 LAKH AND INTEREST THEREON - COMMISSIONER (APPEALS) AND TRIBUNAL CONFIRMED ORDER OF ASSESSING OFFICER - WHETHER ON BASIS OF MATERIAL RECOVERED DURING SEARCH, LOWER AUTHORITIES HAD RIGHTLY DRAWN PRESUMPTION IN TERMS OF SECTION 292C - HELD, YES - WHETHER, THEREFORE, IMPUGNED ADDITION WAS TO BE CONFIRMED - HELD, YES [IN FAVOUR OF REVENUE] . THUS, IN VIEW OF CLEAR CUT FINDING OF HON`BLE JURISDICTIONAL HIGH COURT GUJARAT IN ABOVE CASE, THE ISSUE OF PRESENT CASE IS ALSO COVERED AS DOCUMENTS WERE FOUND DURING SURVEY WHICH REFLECTED CASH MEMO ON WHICH MONTH WISE RECEIPTS. GHANSHYAM DUNGARBHAI SUTARIYA V. ACIT-8-SURAT /I.T.A. NO.1615 & 1730/AHD/2014/A.Y.09-10 PAGE 14 OF 52 THESE RECEIPTS WERE NOT FOUND REFLECTED IN THE BOOKS OF ACCOUNTS OF THE ASSESSEE. HENCE, IN ABSENCE OF ANY CORROBORATING EVIDENCES BROUGHT ON RECORD BY THE ASSESSEE, THE PRESUMPTION UNDER SECTION 292C WOULD BE THAT IT BELONGS TO THE ASSESSEE AND ITS CONTENTS ARISE TRUE AND CORRECT. WE MAY NOTE THAT THE LD. CIT(A) HAS RELIED IN THE CASE OF ALLIANCE HOTELS V. ACIT [2012] 28 TAXMANN.COM 277 (MUMBAI- TRIB) WHEREIN INCRIMINATING DOCUMENTS WERE RECOVERED FROM ITS PREMISES. DURING THE ASSESSMENT, THE AO HAS MADE CERTAIN ADDITIONS BASED ON CERTAIN COMPUTER PRINTOUTS. DURING THE APPELLATE PROCEEDINGS BEFORE ITAT, THE TRIBUNAL HELD THAT SECTION 292C PROVIDES FOR A PRESUMPTION AS TO THE TRUTH OF ANY DOCUMENT FOUND DURING SEARCH FOR THE MONEY RECOVERED FROM ASSESSEE IS BELONGING TO THE ASSESSEE. IN VIEW OF THESE FACTS AND CIRCUMSTANCES , WE ARE OF THE CONSIDERED VIEW THAT LD. CIT(A) HAS CORRECTLY HELD THAT IT IS CLEAR AND EVIDENT THAT THE APPELLANT HAS FAILED TO PRODUCE THE PRIMARY BOOKS OF ACCOUNTS FOR VERIFICATION BEFORE THE ASSESSING OFFICER, IN SPITE OF SEVERAL OPPORTUNITIES. THE LD. CIT(A) ALSO OBSERVED THAT THE APPELLANT HAS ALSO RELIED ON FEW CASE LAWS, WHICH ARE DISTINGUISHABLE ON THE FACTS, AND CIRCUMSTANCES OF THE CASE AND THE RATIO OF THE JUDGEMENT ARE NOT APPLICABLE IN THE INSTANT CASE. THE APPELLANT HAS FAILED TO DISCHARGE THE BURDEN OF PROOF REGARDING THE RECEIPTS FOUND RECORDED IN THE BOOKS OF ACCOUNTS. WE OBSERVE THAT SECTION 102 OF THE EVIDENCE ACT PROVIDES THAT THE BURDEN OF PROOF LIES ON THAT PARTY WOULD FAIL, IF NO EVIDENCE AT ALL WERE GIVEN ON EITHER SIDE. THUS, IF AN ASSESSEE CLAIMED THAT MONEY OR BULLION FOUND IN HIS POSSESSION AT THE TIME OF SEARCH OR SURVEY DOES NOT BELONG TO HIM BUT SOMEONE GHANSHYAM DUNGARBHAI SUTARIYA V. ACIT-8-SURAT /I.T.A. NO.1615 & 1730/AHD/2014/A.Y.09-10 PAGE 15 OF 52 ELSE, THE ONUS IS ON HIM TO ESTABLISH IT, BECAUSE THE ORDINARY PRESUMPTION IS THAT HE IS THE OWNER AS THE MONEY ETC. WAS FOUND IN HIS POSSESSION. SIMILARLY, IN ALL CASES WHERE A PARTICULAR RECEIPTS IS SOUGHT BE TAXED AS INCOME, THE INITIAL ONUS IS ON THE ASSESSING OFFICER TO PROVE THAT IT IS TAXABLE. WHERE THERE IS STATUTORY REBUTTABLE PRESUMPTION AGAINST THE ASSESSEE, AS IN THE CASE OF CASH CREDIT ETC. UNDER SECTION 68 OR UNEXPLAINED INVESTMENT UNDER SECTION 69, THE INITIAL BURDEN OF PROOF IS ON THE ASSESSEE TO SHOW THAT THE HOW CASH CREDIT IS GENUINE OR THE INVESTMENT IS NOT UNEXPLAINED. THE CASE LAWS OF ACIT V. STAYAPAL WASSAN (SUPRA) OF CO-ORDINATE BENCH OF TRIBUNAL AS RELIED BY THE ASSESSEE IS DISTINGUISHABLE ON FACTS AS THE ASSESEE HAS FAILED TO DISCHARGED THE BURDEN OF PROOF AND REBUT THE PRESUMPTION OF SECTION 292C OF THE ACT. IN THE LIGHT OF ABOVE FACTS AND CIRCUMSTANCES, WE NOTE THAT THE ASSESSEE HAS BEEN PROVIDED SUFFICIENT OPPORTUNITIES KEEPING IN VIEW OF THE PRINCIPLE OF NATURAL JUSTICE BY THE LD. CIT(A) AS WELL AS THE AO, BUT HE WAS NOT ABLE TO FURNISH ANY EXPLANATION OR DOCUMENT IN SUPPORT OF HIS CONTENTION. IN VIEW OF THIS MATTER, WE HAVE NO REASON TO DEVIATE FROM THE FINDINGS RECORDED BY THE LOWER AUTHORITIES IN APPLYING 8% OF GROSS PROFIT OF TOTAL CASH RECEIPTS REFLECTED IN COMPUTER PRINTOUTS. ACCORDINGLY, GROUND NO. (I) OF THE APPEAL OF THE ASSESSEE IS THEREFORE, DISMISSED. 11. GROUND NO. (II) RELATES TO ADDITION OF RS.5,72,000/- ON ACCOUNT OF ALLEGED LOAN. GHANSHYAM DUNGARBHAI SUTARIYA V. ACIT-8-SURAT /I.T.A. NO.1615 & 1730/AHD/2014/A.Y.09-10 PAGE 16 OF 52 12. THE PERUSAL OF IMPOUNDED MATERIAL ANX-BF-2, PAGE NO.51 SHOWS THAT IT IS LOAN AGREEMENT WHICH SHOWED THAT THE LOAN OF RS.1 LAKH EACH WAS ADVANCED TO SHRI PREMJIBHAI, LAVJIBHAI, RAMESHBHAI AND PARESHBHAI AGGREGATING TO RS.5,00,000/- ON YEARLY INTEREST RS.18,000/- PER PERSON AND YEARLY TOTAL INTEREST OF THE YEAR AT RS.72,000/- IN THE ABSENCE OF ANY EXPLANATION FILED BY THE ASSESSEE THE LOAN ADVANCED TOTALING TO RS.5 LAKHS WERE TREATED UNACCOUNTED INCOME OF THE ASSESSEE UTILISED IN THE YEAR FOR ADVANCING OF SUCH LOANS AND INTEREST AND THEREON OF RS.72,000/- AS UNACCOUNTED INCOME OF THE YEAR. ACCORDINGLY AN ADDITION OF RS.5,72,000/- WAS MADE ON THIS ISSUE. 13. BEING AGGRIEVED, THE ASSESSEE CARRIED THE MATTER BEFORE THE LD.CIT(A). THE APPELLANT HAS TAKEN THE PLEA THAT THE ABOVE PAPERS ARE NOT RELATED TO THE APPELLANT AND THESE ARE SHOWING SIMPLE CALCULATION OF INTEREST AND NOT REGISTERED LOAN AGREEMENT AND HE DOES NOT KNOW OF SUCH PERSONS AND HAD NEVER ENTERED INTO ANY TRANSACTION WITH THEM. HOWEVER, THE LD.CIT(A) OBSERVED THAT THE CONTENTION OF THE APPELLANT THAT IMPOUNDED BOOKS OF ACCOUNTS AND DOCUMENTS DO NOT BELONG TO HIM HAS BEEN DEALT WITH AS PER GROUND NO.1 ABOVE WHEREIN THE FINDING HAS BEEN GIVEN THAT IN VIEW OF THE PROVISION OF SECTION 292C OF THE ACT, THE CONTENTION OF THE APPELLANT OF DISOWNING THE BOOKS OF ACCOUNTS HAS BEEN REJECTED. THEREFORE, ADDITION MADE BY THE AO AMOUNTING TO RS.5,72,000/- WAS CONFIRMED. GHANSHYAM DUNGARBHAI SUTARIYA V. ACIT-8-SURAT /I.T.A. NO.1615 & 1730/AHD/2014/A.Y.09-10 PAGE 17 OF 52 14. BEING AGGRIEVED, THE ASSESSEE HAS FILED THIS APPEAL BEFORE THIS TRIBUNAL. THE LD. COUNSEL FOR THE ASSESSEE TOOK US THROUGH PAPER BOOK, PAGE NO.13 TO 16 AND SUBMITTED THAT THE YEAR OF ALLEGED LOAN TRANSACTIONS WAS NOT MENTIONED ON THE LOOSE PAPERS, SO THE ADDITION CANNOT BE MADE IN THE YEAR UNDER CONSIDERATION AS SECTION 292C RAISES A PRESUMPTION IN FAVOUR OF THE OWNERSHIP OF DOCUMENT AND NOT AS TO YEAR OF CHARGEABILITY. THE PERSONS TO WHOM SALARY HAS BEEN PAID AND THE LOAN HAS BEEN ALLEGEDLY GIVEN WERE NEVER HAD BEEN EMPLOYEES OF THE ASSESSEE. THE SHEET HAS BEEN PREPARED TO LEARN THE FUNCTION OF THE COMPUTER AND HENCE ANY ADVERSE ACTION SHOULD NOT BE TAKEN ON THE BASIS OF THAT SHEET WITHOUT ANY OTHER DOCUMENTS IMPOUNDED DURING THE SURVEY. IT WAS FURTHER SUBMITTED THAT THE PAPER CONTAINS LOAN AMOUNT OF RS.1 LAKH EACH TO 4 PERSONS, HENCE THE ADDITION AT WORST SHOULD HAVE BEEN MADE AT RS.4 LAKHS PLUS INTEREST OF RS.72,000/- TOTALING TO RS.4,72,000/- INSTEAD OF RS.5,72,000/-. THEREFORE, IF ANY ADDITION IS SUSTAINED THEN IT HAS TO BE RESTRICTED TO RS.4,72,000/-. THE LD. COUNSEL HAS PLACED RELIANCE IN THE CASE OF ACIT VS SHAILESH S. SHAH [1997] 59 TTJ 574 (MUMBAI-TRIBUNAL) IN SUPPORT OF HIS CONTENTION THAT NO ADDITION CAN BE MADE WHERE EXACT DATE OF RECEIPT IS NOT KNOWN. IT WAS FURTHER SUBMITTED THAT IF ADDITION IS SUSTAINED, THEN THE ASSESSEE IS ENTITLED TO TELESCOPING OUT OF THE ADDITION OF RS.86.44 LAKHS MADE IN RESPECT OF GROUND NO.1 ABOVE FOR RS.4 LAKHS AND ONLY RS.72,000/- OF INTEREST COULD BE ADDED. IN SUPPORT OF THIS TELESCOPING THE LD. COUNSEL HAS PLACED RELIANCE ON THE DECISION OF HON'BLE SUPREME COURT IN THE GHANSHYAM DUNGARBHAI SUTARIYA V. ACIT-8-SURAT /I.T.A. NO.1615 & 1730/AHD/2014/A.Y.09-10 PAGE 18 OF 52 CASE OF ANANTHRAM VEERASINGHAIAH & CO VS. CIT [1980] 123 ITR 457 (SC) AND S. KUPPUSWAMI MUDALIAR VS. CIT, MADRAS [1964] 51 ITR 757 (MAD). 15. PER CONTRA, THE LD. CIT (DR) HAS REITERATED THE SUBMISSIONS MADE IN RESPECT OF GROUND NO. (I) ABOVE AND ADMITTED THAT ADDITION MADE AT RS.5, 72,000/- IS NOT CORRECT AS THE CORRECT ADDITION AS PER IMPOUNDED MATERIAL SHOULD HAVE BEEN AT RS.4,72,000/- ONLY. 16. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. WE FIND THAT THE IMPOUNDED MATERIAL BF-2 PAGE 51 WAS FOUND FROM THE PREMISES OF THE ASSESSEE BEING COMPUTER PRINTOUT INDICATING THAT LOAN OF RS.1 LAKH EACH WAS GIVEN THE 4 PERSONS NAMELY PREMJIBHAI, LAVJIBHAI, RAMESHBHAI AND PARESHBHAI INDICATING A LOAN AGREEMENT AND CLEARLY MENTIONING THAT THE PRINCIPAL AMOUNT WITH MONTHLY INTEREST AND YEARLY INTEREST FROM EACH INDIVIDUALS. THEREFORE, UNLESS OTHERWISE PROVED, IT WILL BE PRESUMED THAT SUCH BOOKS OF ACCOUNTS ETC., BELONGS TO SUCH PERSON AND ITS CONTENTS ARE TRUE AS PER PROVISIONS OF SECTION 292C OF THE ACT. WE, FURTHER FIND THAT LD. CIT(A) HAS SUPPORTED HIS VIEW WITH REGARD TO PRESUMPTION U/S.292C OF THE ACT BY PLACING RELIANCE IN THE CASE OF ASSTT. CIT V. VATIKA GREENFIELD (P) LTD. [2009] 121 TTJH (DELHI) 208 AND DECISION OF HON'BLE GUJARAT HIGH COURT IN THE CASE OF HIREN VASANTLAL SHAH [2012] 19 TAXMANN.COM 241 (GUJARAT) WHEREIN IT WAS HELD AS UNDER :- IT WAS HELD THAT SECTION 292C OF THE INCOME-TAX ACT, 1961 PRESUMPTION AS TO ASSETS, BOOKS OF ACCOUNT, ETC. PURSUANT TO A SEARCH AT ASSESSEES PREMISES, GHANSHYAM DUNGARBHAI SUTARIYA V. ACIT-8-SURAT /I.T.A. NO.1615 & 1730/AHD/2014/A.Y.09-10 PAGE 19 OF 52 CERTAIN DOCUMENTS WERE FOUND AND ONE OF SUCH DOCUMENTS CONTAINED WORKING OF INTEREST AT RATE OF 3 PER CENT ON TOTAL SUM OF RS. 3 LAKH ASSESSEE WAS DIRECTED TO EXPLAIN CONTENTS OF DOCUMENT FOUND DURING COURSE OF SEARCH ASSESSEE EXPLAINED THAT CONTENTS OF SAID DOCUMENT WERE ROUGH WORKING AND NO LOAN WAS GIVEN OUT ASSESSING OFFICER REJECTED ASSESSEES EXPLANATION- WHETHER ON BASIS OF MATERIAL RECOVERED DURING SEARCH, LOWER AUTHORITIES HAD RIGHTLY DRAWN PRESUMPTION IN TERMS OF SECTION 292C HELD, YES WHETHER, THEREFORE, IMPUGNED ADDITION WAS TO BE CONFIRMED HELD, YES [IN FAVOUR OF REVENUE] 17. SINCE THE INCRIMINATING DOCUMENTS WAS RECOVERED FROM THE PREMISES OF THE ASSESSEE, THEREFORE, WE FIND NO REASON TO DRAW ADVERSE INFERENCE IN THE FINDING RECORDED BY THE LOWER AUTHORITIES, ACCORDINGLY SAME IS CONFIRMED. HOWEVER, THE ADDITION ON THE BASIS OF SEIZED MATERIAL IS WORKED OUT TO RS.4, 72,000 [BEING LOAN AMOUNT OF RS. 4 LAKHS AND INTEREST OF RS.72,000/-]. THEREFORE, ADDITION OF RS. 4,72,000 IS CONFIRMED AND BALANCE ADDITION OF RS. 1, 00, 000 IS DELETED. HOWEVER, SINCE THE ASSESSEE HAS CLAIMED THAT TELESCOPING SHOULD BE ALLOWED WITH RESPECT TO ADDITION SUSTAINED IN GROUND NO.1 ABOVE RS.86.44 LAKHS. THE ASSESSEE IS ENTITLED TO TELESCOPING OF RS.4 LAKHS. THEREFORE, SAME IS ALLOWED OUT OF RS.86.44 LAKHS. THEREFORE, ADDITION OF RS.4 LAKHS SUSTAINED IS COVERED BY TELESCOPING AND BALANCE ADDITION OF RS.72,000/- IS UPHELD. ACCORDINGLY, THIS GROUND OF APPEAL OF THE ASSESSEE IS PARTLY ALLOWED. 18. GROUND NO.(III) OF THE ASSESSEE RELATES TO CONFIRMATION OF THE ADDITION OF RS.1,34,86,000/- ON ACCOUNT OF ALLEGED BOOKING RECEIPTS AND GROUND NO.5 OF THE REVENUE APPEAL RELATES TO RESTRICTING THE ADDITION MADE ON ACCOUNT OF GHANSHYAM DUNGARBHAI SUTARIYA V. ACIT-8-SURAT /I.T.A. NO.1615 & 1730/AHD/2014/A.Y.09-10 PAGE 20 OF 52 UNACCOUNTED INCOME OF RS.34,82,000/-, RS.1,42,60,000/- AND RS.5,43,49,000/- TO RS.1,34,86,000/- WITHOUT APPRECIATING THE FACT THAT THE ASSESSEE FAILED TO EXPLAIN THE LOOSE PAPER NOTINGS. THESE GROUNDS OF APPEAL OF THE ASSESSEE AND REVENUE ARE INTERRELATED HENCE, BEING CONSIDERED TOGETHER IN THESE GROUNDS OF APPEAL. 19. THE IMPOUNDED MATERIAL BF-3, PAGE NO.83, 82 & 81 SHOWED THE RECEIPTS AND PENDING PAYMENT AGAINST THE VARIOUS PLOTS. THEREFORE, THE ASSESSEE WAS ASKED TO FURNISH EXPLANATION AS TO WHETHER SUCH RECEIPTS HAVE BEEN ACCOUNTED FOR IN THE BOOKS OF ACCOUNTS MAINTAINED WITH NECESSARY EVIDENCE. HOWEVER, THE ASSESSEE HAS STATED THAT PAGE NO.73 TO 84 OF BF-2 (THE RELEVANT PAPERS HOWEVER PERTAINS TO BF-3 AND NOT BF-2 AS STATED BY THE ASSESSEE) A ROUGH LOOSE PAPER IS NOT IN HIS HANDWRITING NOR ANY HANDWRITING OF ANY OF HIS FAMILY MEMBERS. HOWEVER, THE AO WAS OF THE VIEW THAT SUCH CONTENTION OF THE ASSESSEE CANNOT BE ACCEPTED AS THE ASSESSEE IS DUTY BOUND TO FURNISH NECESSARY EXPLANATION WITH REGARD TO WHATEVER MATERIAL HAS BEEN IMPOUNDED FROM HIS PREMISES. 20. HOWEVER, THE AO ON THE EXAMINATION OF IMPOUNDED MATERIAL BF-3 PAGE NO.84 FOUND THAT THE RECEIPTS AND PENDING PAYMENTS IN RESPECT OF PLOT NO.86 & 96. AGAINST PLOT NO.86, FIGURE OF 2134 IT IS SHOWN, AREA BEING 140 SQ. YD. AND PRICE 15,242/- IMPLYING PRICE OF RS.15,242/- PER SQ. YD. MULTIPLIED BY 140 SQ. YD. WILL ARRIVE AT TOTAL PRICE OF RS.21,33,880/-, I.E. RS.21,34,000/-, AS SHOWN IN THE CODED FIGURES. AS AGAINST PLOT NO.92, FIGURE OF 1348 IS SHOWN, AREA BEING 98 SQ. YD. AND GHANSHYAM DUNGARBHAI SUTARIYA V. ACIT-8-SURAT /I.T.A. NO.1615 & 1730/AHD/2014/A.Y.09-10 PAGE 21 OF 52 PRICE 15146 IMPLYING PRICE OF RS.15,146/- PER SQ. YD. MULTIPLIED BY 98 SQ. YD. TO ARRIVE AT TOTAL PRICE OF RS.14,84,308/-, I.E. RS.14,84,000/-, WHEREAS THE APPELLANT HAS SHOWN FIGURE OF RS.13,48,000/-. THE AMOUNT OF RS.21,34,000/- IN RESPECT OF PLOT NO. 86 AND AMOUNT OF RS.13,48,000/- IN RESPECT OF PLOT NO. 92, TOTALING RS. 34,82,000/- WAS TAXED AS THE UNACCOUNTED INCOME OF THE APPELLANT OF THE YEAR. 21. THE LD.AO FURTHER NOTED THAT THE VARIOUS FIGURES AGAINST THE PLOT NOS.62, 44, 38, 37 AND 35 ARE WRITTEN AS TOTALING 817 AND 1511 ARE IN CODED FIGURES WHICH WERE TAKEN AS RS.8,17,000/- AND RS.15,11,000/- TOTALING TO RS.23,28,000/-. SIMILARLY, THE AMOUNT SHOWS IN BF-3 IS 82, WHICH WAS ALSO IN CODED FIGURES WHICH WAS DECIPHERED AND CALCULATED AT RS.96,77,000/-. SIMILARLY, THE AMOUNT SHOWED IN BF-3, PAGE 81 IS AGAINST PLOT SHOWS AS FIGURE OF 1535 IMPLYING THAT RS.8,20,000/- IS PAID AND RS.15,35,000/- BEING PAYABLE TOTALING TO RS.23,55,000/-. SINCE NO EXPLANATION BY THE ASSESSEE WAS FURNISHED IN RESPECT OF ABOVE AMOUNT TOTALING TO RS. 23,28,000/- IN PAGE 83 AND RS.96,77,000/- IN PAGE 82 AND RS.23,55,000/- IN PAGE 81 AGGREGATING TO RS.1,43,60,000/- WAS CONSIDERED AS ASSESSEES UNACCOUNTED INCOME IN THE YEAR UNDER CONSIDERATION. 22. SIMILARLY, THE AO ON EXAMINATION OF IMPOUNDED MATERIAL BF-3 PAGE NO 73 & 74 FOUND THAT THE VARIOUS NOTING OF TRANSACTIONS. THE AO DECODED THE FIGURES AND ARRIVED AT A FIGURE OF RS.1,39,35,000/- IN RESPECT NOTINGS APPEARING AT PAGE 74 AND RS.4,04,14,000/- IN RESPECT OF NOTINGS APPEARING AT PAGE 73 OF BF-3, WHICH IS DATED GHANSHYAM DUNGARBHAI SUTARIYA V. ACIT-8-SURAT /I.T.A. NO.1615 & 1730/AHD/2014/A.Y.09-10 PAGE 22 OF 52 15.09.2008. THE ASSESSEE IN REPLY, MERELY STATED THAT IT IS A ROUGH LOOSE PAPER AND NOT THIS IS IN HIS OR HIS FAMILY MEMBERS HANDWRITING. HOWEVER, THIS CONTENTION OF THE ASSESSEE WAS NOT FOUND ACCEPTABLE. SINCE, THESE MATERIALS WERE IMPOUNDED FROM THE PREMISES OF THE ASSESSEE, ACCORDINGLY THE ADDITION OF RS.5,43,49,000/- [RS.1,39,35,000/- (PAGE74) + RS.74,04,14,000/- (PAGE 73) ] WAS MADE TO THE TOTAL INCOME OF THE ASSESSEE. 23. BEING AGGRIEVED, THE ASSESSEE CARRIED THE MATTER BEFORE THE LD. CIT(A). THE LD. CIT(A) HAS EXAMINED THE DETAILED SUBMISSIONS MADE BY THE ASSESSEE AND ALSO CALLED FOR A REMAND REPORT FROM THE AO. THE LD. CIT(A) HAS ARRIVED A FINDING AS GIVEN IN PARA 6.8.1 TO 6.8.7 WHICH IS REPRODUCED AS UNDER: 6.8.1 THE GROUNDS OF APPEAL- GROUND NO.7, 8 & 9 PERTAINS TO ADDITION OF RS.34,82,000/-, RS.1,43,60,000/- AND RS.5,43,49,000/- ON ACCOUNT OF UNDISCLOSED INCOME. ON THE PERUSAL OF THE FACTS, IT IS OBSERVED THAT THE AO HAS MADE THE ADDITION AFTER EXAMINING THE ENTRIES IN THE IMPOUNDED DOCUMENTS. THE AO ON THE EXAMINATION OF IMPOUNDED MATERIAL BF-3 PAGE NO. 84 FOUND RECEIPTS AND PENDING PAYMENTS IN RESPECT OF PLOT NO.86 & 96. AGAINST PLOT NO.86, 2134 IS SHOWN, AREA BEING 140 SQ. YD. AND PRICE 15,242/- IMPLYING PRICE OF RS.15,242/- PER SQ. YD. MULTIPLIED BY 140 SQ. YD. WILL ARRIVE AT TOTAL PRICE OF RS.21,33,880/-, I.E. RS.21,34,000/-, AS SHOWN IN THE CODED FIGURES. AS AGAINST PLOT NO.92, 1348 IS SHOWN, AREA BEING 98 SQ. YD. AND PRICE 15146 IMPLYING PRICE OF RS.15,146/- PER SQ. YD. MULTIPLIED BY 98 SQ. YD. TO ARRIVE AT TOTAL PRICE OF RS.14,84,308/-, I.E. RS.14,84,000/-, WHEREAS THE APPELLANT HAS SHOWN FIGURE OF RS.13,48,000/-. THE AMOUNT OF RS.21,34,000/- IN RESPECT OF PLOT NO. 86 AND AMOUNT OF RS.13,48,000/- IN RESPECT OF PLOT NO. 92, TOTALING RS. 34,82,000/- WAS TAXED AS THE UNACCOUNTED INCOME OF THE APPELLANT OF THE YEAR. 6.8.2 ON PERUSAL OF IMPOUNDED MATERIAL BF-3 PAGE NO. 81 TO 84 AND PAGE NO 73 & 74 IT IS OBSERVED THAT SOME CALCULATION WORK IN RESPECT OF PLOTS HAD BEEN DONE ON THE PAGE NO.81 TO 84 AND ON THESE PAGES PLOT NO., MONTH GHANSHYAM DUNGARBHAI SUTARIYA V. ACIT-8-SURAT /I.T.A. NO.1615 & 1730/AHD/2014/A.Y.09-10 PAGE 23 OF 52 (MAHINA), RECEIVED (BHARELA) AND DUE (AAPVANA) IS WRITTEN. SIZE OF THE PLOT IS ALSO MENTIONED ON THE SAME. PAGES NO.73 & 74 ARE WRITTEN IN PENCIL AND REFLECTS SOME CALCULATION WORK REGARDING THE PLOTS. DURING THE COURSE OF REMAND REPORT, THE APPELLANT WAS AGAIN SHOWN THE IMPOUNDED MATERIAL BF-3 PAGE NO. 81 TO 84 AND PAGE NO 73 & 74 AND ASKED TO GO THROUGH THE SAID IMPOUNDED PAPERS AND EXPLAIN IN DETAILS. IN REPLY TO QUESTION NO.LL, THE APPELLANT HAS STATED THAT, THESE PAPERS NOT BELONGING TO HIM AND ALSO THE CONTENTS WRITTEN ON THESE PAPERS ARE ALSO NOT IN HIS OR ANY OF THE MEMBERS OF HIS FAMILY'S HANDWRITING. 6.8.3 IN RESPONSE TO THE AOS FINDINGS IN THE REMAND REPORT, THE APPELLANT SUBMITTED VIDE HIS WRITTEN SUBMISSION DATED 27.02.2013 AS FOLLOWING:- ADDITION OF RS.34,82,000, 143,60,000 & 543,49,00 AS UNACCOUNTED INCOME: DETAILED DISCUSSION OF BF- 3 PG. NO. 81 TO 84 & 73 BASED ON WHICH ADDITION HAS BEEN MADE WERE DONE IN REPLY TO REMAND REPORT PROCEEDINGS BEFORE THE LD AO. COPY OF THE SAME, IS ATTACHED. YOUR HONOUR IS- REQUESTED TO READ PG. 8 TO PG 19 (A-38 TO 50) AS A PART OF THIS SUBMISSION. THE WHOLE ADDITION REVOLVES AROUND PG. NO. 73 OF BF- 3. HENCE THE TOTAL PAYMENT MADE BY THE APPELLANT IF AT ALL PAID COMES TO RS. 1,23,60,000 WHICH INCLUDES INTEREST PORTION AND CAPITAL PORTION OF RS. 74,00,000. THE APPELLANT HAD BOOKED PLOT WITH A CONDITION THAT IF THE PLOTS DOES NOT GET LEGAL CLEARANCE THE AMOUNT WILL BE RETURNED WITH INTEREST. THE APPELLANT WAS UNABLE TO CLEAR THE PLOT IN LEGAL FACTUM AND HENCE HAD TO RETURN THE MONEY AND HENCE THIS PAYMENT. AT THIS JUNCTURE IT WOULD NOT BE OUT OF PLACE TO MENTION THAT IF AT ALL ADDITION HAS TO BE MADE IT CAN BE MADE ONLY OF THE INTEREST PORTION. THE ADVANCE RECEIVED FOR BOOKING OF THE PLOTS WERE IN FACT RECEIVED FROM VARIOUS PARTIES. THE ADVANCE WERE RETURNED BY THE APPELLANT DUE TO LEGAL HINDRANCE IN CLEARING THE PLOTS BOOKED BY THE APPELLANT. HENCE ADDITION SHOULD BE RESTRICTED TO THE INTEREST COMPONENT WHICH CAN BE PRESUMED UNEXPLAINED EXPENDITURE OF THE APPELLANT.' 6.8.4 DURING THE APPELLATE PROCEEDINGS, THE APPELLANT WAS ASKED TO FURNISH THE DETAILS OF THE 10 PLOTS AND THE PROSPECTIVE BUYERS FROM WHOM ADVANCE WAS TAKEN AND LATER RETURNED WITH INTEREST. THE APPELLANT SUBMITTED VIDE HIS LETTER DATED 13.03.2014 THAT 'DURING THE COURSE OF BUSINESSMAN IN REAL ESTATE & AS A BROKER, I HAD IN THE YEAR 2005 TAKEN UP A BUSINESS VENTURE TO SELL 10 PLOTS ADMEASURING VARIOUS SQUARE YARDS, THE BOOKING ADVANCE FOR SUCH PLOTS IS AS UNDER : GHANSHYAM DUNGARBHAI SUTARIYA V. ACIT-8-SURAT /I.T.A. NO.1615 & 1730/AHD/2014/A.Y.09-10 PAGE 24 OF 52 SR. NO . PLOT NO. NAME OF BUYERS PAYMENT BY BUYERS (000) INTEREST COMPENSAT ION TO BUYER (000) AMOUNT REFUNDED TO BUYER (000) 1 62 ASHABEN SAVJIBHAI SURANI ADD: RATANPAR, TALUKO, VALLABHBHIPUR, DIST. BHAVNAGAR 817 666 1483 2 66 RAMJIBHAI LAVJIBHAI MORADIYA, ADD: JHINJHA TALUKO GADHRA, BHAVNAGAR. 724 593 1317 3 80 AMBABEN RAMJIBHAI ADD: JHINHA TALUKO GADHRA, BHAVNAGAR. 595 496 1091 4 7 LAXMIBEN AMARSHIBHAI DHOLA, ADD. KHODIYAD NAGAR SOC., VARACHHA ROAD, SURAT 540 1106 566 5 84 LABHUBHAI AMARSHIBHAI DHOLA, ADD: KHODIYAD NAGAR SOC. VARACHHA ROAD, SURAT 540 453 993 6 86 KANTABEN SAVJIBHAI SURANI, ADD: RATANPAR, TALUKO, VALLABHBHIPUR, DIST.BHAVNAGAR. 1330 804 2134 7 88 KRISHNABEN LAVJIBHAI PATEL, 680 571 1251 GHANSHYAM DUNGARBHAI SUTARIYA V. ACIT-8-SURAT /I.T.A. NO.1615 & 1730/AHD/2014/A.Y.09-10 PAGE 25 OF 52 ADD: 7 DHARMANANDAN SO., LAXMIKANT ROAD, KATARGAM, SURAT 8 92 AMARSHIBHAI LAJIBHAI, ADD: ZAMRARA, TALUKO & DIST. BOTAD. 595 503 1098 9 103 JADAVBHAI JASHMATBHAI, ADD: AMBIKA NAGAR SOC., KATARGAM ROAD, SURAT. 820 690 1510 10 104 KALUBHAI AMARSHIBHAI PATEL, ADD: ZAMARARA, TALUKO & DIST. BOTAD. 825 678 1503 TOTAL 74,66,000 60,20,000 1,34,86,00 0 THE AMOUNT HAS BEEN RETURNED WITH INTEREST/COMPENSATION AROUND F.Y. 2008- 09, THE PLOTTING WAS DONE AT MAKANJI PARK, MOTI VED, VED ROAD, SURAT. THE PLOT WAS UNDER RESERVATION WHEN I HAD TAKEN UP THE BUSINESS OF BOOKING IT AND I WAS NOT ABLE TO GIVE A CLEAR TITLE TO THE SO CALLED BUYER. HENCE, TO SAVE MY REPUTATION IN MARKET I HAD PAID TO SUCH BUYERS THE CAPITAL PORTION PAID BY THEM TO ME ALONGWITH INTEREST AT 2% P.M. PAGE NO. 84 SHOWS IN DEAR TERM THE PAYMENT OF 2% INTEREST, WHICH IS IN GUJARATI. DURING THE F. Y. 2008-09 THE PLOTTING WAS DONE AT MAKANJI PARK, MOTI VED, VED ROAD, SURAT. BUT SINCE THE LAND WAS UNDER RESERVATION THE TITLE COULD NOT BE. GIVEN TO THE BUYERS.' 6.8.5 THE VARIOUS DETAILS REGARDING THE 10 PLOTS HAVE BEEN SUMMARIZED ON PAGE 73 OF BF-3. THE VARIOUS IMPOUNDED MATERIAL IN ANNEXURE BF-3 GIVE DETAILS OF PLOT NUMBER WISE TRANSACTIONS DIVIDED INTO 3 PARTS. THE DETAILS OF PLOT NO., MONTH, DEPOSIT AND PAYABLE ARE GIVEN IN FOLLOWING MANNER IN THE IMPOUNDED DOCUMENTS. NO.86 BHARELA 1330 MAHINA BHARELA AAPVANA GHANSHYAM DUNGARBHAI SUTARIYA V. ACIT-8-SURAT /I.T.A. NO.1615 & 1730/AHD/2014/A.Y.09-10 PAGE 26 OF 52 41 800 1456 14 530 678 1330 2134 SQ YARD 140 NEW RATE : 15242 NO.86 IS THE PLOT NUMBER. MAHINA MEANS MONTHS. (DICTIONARY MEANING OF THE GUJARATI WORD) BHARELA MEANS DEPOSITED. (DICTIONARY MEANING OF THE GUJARATI WORD) AAPVANA MEANS PAYABLE. (DICTIONARY MEANING OF THE GUJARATI WORD) SQ.YARD IS THE SIZE OF THE PLOT. ON THE BASIS OF THE ENTRIES IN THE IMPOUNDED DOCUMENT AND THE SUBMISSION OF THE APPELLANT THE FOLLOWING PICTURE EMERGES IN RESPECT OF THE 10 PLOTS. IN THE TABLE ABOVE AND BELOW, ONLY DETAILS PERTAINING TO ONE PLOT NO. 86 HAS BEEN TAKEN FOR ILLUSTRATION PURPOSES. NO.86 (PLOT NO.) BHARELA 1330(PAID) MAHINA BHARELA AAPVANA DIFFERENCE WORKING OF DIFFERENT AMOUNT 41 800 1456 656 800*2% PM *41 MONTHS=656 14 530 678 148 530*2 PM * 14 MONTHS=148 1330 2134 1334 SQ YARD 142 NEW RATE : 15242 NEW RATE DERIVED BY 2134000/140 SQ YARD= 15242 THE VARIOUS IMPOUNDED PAPERS HAVE THE SAME CALCULATIONS OF THE 10 PLOTS AND THE AMOUNT PAID, PAYABLE ETC WHICH BEEN SUMMARIZED AS UNDER. PLOTS 84 62 66 7 86 92 103 80 104 88 TOTAL PAGE NO.7 3 540 817 724 540 133 0 595 820 595 825 680 7466 132 3 190 0 180 6 124 7 249 3 142 4 196 9 141 5 196 9 161 2 1715 8 993 148 3 131 7 213 4 109 8 151 0 109 1 150 3 125 1 1238 0 GHANSHYAM DUNGARBHAI SUTARIYA V. ACIT-8-SURAT /I.T.A. NO.1615 & 1730/AHD/2014/A.Y.09-10 PAGE 27 OF 52 540 817 --- --- --- --- --- --- --- --- 132 3 --- --- --- --- --- --- --- --- --- PAGE NO.7 4 --- --- 724 540 133 0 595 820 595 825 680 --- --- 124 7 124 7 249 3 142 4 196 9 141 6 196 9 161 2 --- --- 131 7 213 4 109 8 151 0 109 1 150 3 152 1 PAGE NO.8 1 --- --- --- --- --- --- 820 --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- 151 0 --- --- --- PAGE NO.8 2 540 --- 724 --- --- --- --- 595 825 680 --- --- --- --- --- --- --- --- --- --- PAGE NO.8 3 --- 817 --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- PAGE NO.8 4 --- --- --- --- 133 0 595 --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- 213 4 109 8 --- --- --- --- 6.8.6 THE ABOVE ILLUSTRATION BASED ON THE ENTRIES PERTAINING TO EACH PLOT RECORDED IN THE IMPOUNDED DOCUMENT SHOW THAT THE APPELLANT HAD SOLD 10 PLOTS OF VARIOUS SIZES TO 10 BUYERS AND HAD RECEIVED RS.74,66,000/- AS ADVANCE TOWARDS THE SALE OF PLOT. THE APPELLANT PAID INTEREST @ SIMPLE INTEREST OF 2% PER MONTH ON THE AMOUNT DEPOSITED BY THE BUYERS. THE TOTAL AMOUNT OF PAYMENT RETURNED BACK TO THE VARIOUS BUYERS IS OF RS.1,34,86,000/- WHICH INCLUDES THE INTEREST AS WELL AS THE CAPITAL AMOUNT. THE APPELLANT WAS NOT ABLE TO FURNISH ANY DETAILS REGARDING THE SOURCE OF THIS PAYMENT OF GHANSHYAM DUNGARBHAI SUTARIYA V. ACIT-8-SURAT /I.T.A. NO.1615 & 1730/AHD/2014/A.Y.09-10 PAGE 28 OF 52 RS.1,34,86,000/- DURING THE APPELLATE PROCEEDINGS. THE APPELLANT SUBMITTED THAT THE AMOUNT ADVANCED FROM THE 10 PURCHASERS HAD BEEN GIVEN TO THE ORIGINAL OWNER OF THE PLOT. BUT SINCE THE TITLE OF THE PROPERTY WAS IN DISPUTE THE ACTUAL TRANSFER DID NOT TAKE PLACE AND THE ORIGINAL OWNER RETURNED THE AMOUNT WITH INTEREST. 6.8.7 ON THE BASIS OF THE ABOVE FACTS, IT IS EVIDENT THAT THE ENTRIES IN THE IMPOUNDED MATERIAL ARE PERTAINING TO ADVANCE RECEIVED TOWARDS THE SALE OF 10 PLOTS AND THE REFUND OF THESE ADVANCES TO THE PURCHASERS WITH THE INTEREST AMOUNT. THE CALCULATIONS OF THE RATE OF SALE OF EACH PLOT, TOTAL PAYMENTS MADE TOWARDS THE PLOT, OUTSTANDING AMOUNT AND INTEREST PAID @2% MATCHES WITH THE SUBMISSIONS MADE BY THE APPELLANT. HENCE, THE AMOUNT OF RS. 1,34,86,000/- IS SUSTAINED AS AN UNACCOUNTED INCOME IN THE HANDS OF THE APPELLANT, OUT OF THE TOTAL ADDITION MADE BY THE AO OF RS. 7,21,91,000/- (RS. 34,82,000/- + RS. 1,43,60,000/- + RS. 5,43,49,000/-) REGARDING THE TRANSACTIONS PERTAINING TO THE 10 PLOTS. ON THE BASIS OF THE GIVEN FACTS AND CIRCUMSTANCES, THE TRANSACTIONS RELATING TO THE ADVANCES GIVEN BY THE VARIOUS 10 BUYERS AS PER THE CHART AT PARA 6.8.4 TOWARDS THE PLOTS NEEDS TO BE EXAMINED. THE AO IS DIRECTED TO INFORM THE CONCERNED AO OF 10 BUYERS OF PLOT REGARDING THEIR INVESTMENTS AND THE AMOUNT OF INTEREST RECEIVED ON THE ADVANCES AND TO TAKE APPROPRIATE ACTION AS PER THE PROVISIONS OF LAW. IN VIEW OF THE ABOVE FACTS AND CIRCUMSTANCES, THE ADDITION TO THE EXTENT OF RS. 1,34,86,000/- IS UPHELD THOUGH FOR DIFFERENT REASONS AND THE GROUNDS OF APPEAL IS PARTLY ALLOWED. THE APPELLANT HAD NOT DISCLOSED THIS TRANSACTION WITH THE INTENT TO EVADE TAX AND THEREFORE HAS CONCEALED THE TRUE AND CORRECT PARTICULARS OF INCOME HENCE THE PENALTY PROCEEDINGS U/S 271(L)(C) R.W.S. 274 OF THE ACT IS BEING INITIATED. (CONFIRMED:RS. 1,34,86,000/-). 24. BEING AGGRIEVED, THE ASSESSEE HAS FILED THIS APPEAL IN RESPECT OF THE ADDITION OF RS.1,34,86,000/- SUSTAINED BY THE CIT(A) WHEREAS THE REVENUE HAS FILED APPEAL IN RESPECT OF ADDITION DELETED BY THE LD. CIT(A) AS MENTIONED IN ABOVE GROUNDS OF APPEAL. 25. THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THESE ARE LOOSE PAPERS AND DUMB DOCUMENTS THEREFORE CANNOT BE RELIED UPON TO MAKE ANY ADDITION. THESE LOOSE GHANSHYAM DUNGARBHAI SUTARIYA V. ACIT-8-SURAT /I.T.A. NO.1615 & 1730/AHD/2014/A.Y.09-10 PAGE 29 OF 52 PAPERS ARE NOT IN THE HANDWRITING OF THE ASSESSEE OR HIS FAMILY MEMBERS. HENCE, NO ADDITION CAN BE MADE BASED ON THESE LOOSE PAPERS. THESE PAPERS DOES NOT CONTAIN NAME AND ADDRESS OF ANY PERSON AND YEAR OF TRANSACTION. EVEN IF THE ADDITION IS TO BE SUSTAINED, THEN THE BENEFIT OF RS.74,66,000/- WAS REQUIRED TO BE GIVEN TO THE ASSESSEE AS AMOUNT COLLECTED FROM PROSPECTIVE BUYER AT THE TIME OF BOOKING IS AVAILABLE WITH THE ASSESSEE AT THE TIME OF REPAYMENT. THE LD. COUNSEL FURTHER SUPPORTED HIS VIEW BY PLACING RELIANCE IN THE CASE OF ACIT VS. SHAILESH .S. SHAH [1997] 63 ITD 153 (MUMBAI- TRIB.) AND ACIT VS. STYAPAL WASSAN [2007] 295 ITR (AT) 3525 (JAB). WITH REGARD TO DELETION OF ADDITION, THE LEARNED COUNSEL FOR THE ASSESSEE HAS SUPPORTED THE ORDER OF LD. CIT(A). 26. ON THE CONTRARY, THE LD. CIT-DR SUPPORTED THE AO. THE LD.CIT(DR) SUBMITTED THE ASSESSING OFFICER HAS MADE AN ADDITION IN ABSENCE OF ANY AMOUNT SHOWN IN THE BOOKS OF ACCOUNTS OF THE ASSESSEE. THEREFORE, THE LD. CIT(A) SHOULD HAVE SUSTAINED THE ADDITION MADE BY THE AO. WITH REGARD TO SUSTAINING THE ADDITION OF RS.1,34,86,000/-, THE LD.CIT (DR) RELIED ON THE ORDER OF LD. CIT(A). IT WAS FURTHER SUBMITTED THAT THE LD. CIT(A) SHOULD HAVE GIVEN DIRECTION THE AO FOR MAKING PROTECTIVE ADDITION. 27. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. WE FIND THAT THE ENTRIES APPEARING IN IMPOUNDED MATERIAL BEING ANX-BF-3, PAGE NO. 86 AND 92 AND OTHER LOOSE PAPERS CONTAINED DETAILS OF RECEIPTS OF BOOKING GHANSHYAM DUNGARBHAI SUTARIYA V. ACIT-8-SURAT /I.T.A. NO.1615 & 1730/AHD/2014/A.Y.09-10 PAGE 30 OF 52 MONEY IN RESPECT OF VARIOUS PLOTS THE TOTAL OF SUCH PLOT HAS BEEN WORKED OUT AS TEN NUMBER OF PLOTS OF WHICH EXPLANATION WAS FILED BY THE ASSESSEE VIDE HIS LETTER DATED 13.03.2014 WHICH HAS BEEN REPRODUCED BY THE LD.CIT(A) IN PARA NO.6.8.4, AS REPRODUCED ABOVE. ACCORDINGLY, THE TOTAL PAYMENTS BY BUYERS WAS COMPUTED AT RS.74,66,000/- AND INTEREST COMPENSATION TO BUYERS WAS COMPUTED AT RS.60,20,000/- AGGREGATING TO RS.1,34,86,000/-. THE LD.CIT(A) HAS ALSO CONSIDERED AND DECODED THE AMOUNT MENTIONED IN RESPECT OF THESE PLOTS, CONSIDERED AND CITED SPECIFIC EXAMPLE IN RESPECT OF PLOT NO.86 THE AMOUNT WHICH WAS WRITTEN IN CODED FIGURES AND ARRIVED AT A CORRECT FIGURE OF WHICH WORKING IS GIVEN IN PARA 6.8.5 OF HIS ORDER AS REPRODUCED IN THIS APPELLATE ORDER ABOVE. THUS, CONSIDERING THE TOTALITY OF THE FACTS AND DETAILS ENTRIES PERTAINING TO EACH PLOT RECORDED IN THE IMPOUNDED DOCUMENT SHOWED THAT THE ASSESSEE HAS SOLD 10 PLOTS TO VARIOUS 10 BUYERS AND HAD RECEIVED A SUM OF RS.74,66,000/- AS ADVANCED TOWARDS THE SALE OF PLOT. IT IS FURTHER NOTICED THAT THE ASSESSEE HAS PAID SIMPLE INTEREST @2% PER MONTH ON THE AMOUNT DEPOSITED BY THE BUYER WHICH HAS BEEN CALCULATED AT RS.60,20,000/- BY THE LD. CIT(A). THUS, THE TOTAL AMOUNT RETURNED BACK TO THE VARIOUS BUYERS HAS BEEN WORKED OUT AT RS.1,34,86,000/-[ 74,66,000 + 60,20,000] WHICH INCLUDED THE INTEREST AS WELL AS THE PRINCIPAL AMOUNT. SINCE, THE ASSESSEE WAS NOT ABLE TO FURNISH ANY DETAILS REGARDING THE SOURCE OF THESE PAYMENTS THE LD.CIT(A) HAS RIGHTLY UPHELD THE ADDITION TO THIS EXTENT. THEREFORE, WE DO NOT FIND ANY INFIRMITY IN THE ORDER THE LD.CIT(A) IN SUSTAINING THE ADDITION OF RS.1,34,86,000/-, HENCE, SAME IS UPHELD. WITH REGARD TO GHANSHYAM DUNGARBHAI SUTARIYA V. ACIT-8-SURAT /I.T.A. NO.1615 & 1730/AHD/2014/A.Y.09-10 PAGE 31 OF 52 REVENUES GROUND OF APPEAL IN RESPECT OF DELETION OF ADDITION OF RS.34,82,000/- WE FIND THAT THIS AMOUNT OF ADDITION IS ALREADY BEEN COVERED BY THE ADDITION OF RS.1,34,86,000/- SUSTAINED IN RESPECT OF PLOT NO.86 AND 92 WHICH ARE FIGURING IN PARA 6.8.4 AT SL.NO.6 & 9 OF THE TABLE. THEREFORE, WE DO NOT FIND ANY INFIRMITY IN DELETING OF THE SAID ADDITION BY THE LD.CIT(A), ACCORDINGLY THIS GROUND OF APPEAL OF THE REVENUE IS DISMISSED. SIMILARLY, WITH REGARD TO ADDITION OF RS.5,43,49,000/-, WE FIND THAT THESE ADDITIONS HAVE BEEN MADE ON THE BASIS OF IMPOUNDED PAGE NO.73 & 74 OF ANNEXURE B, F3 WHICH HAS BEEN ALREADY TAKEN CARE OF BY THE LD. CIT(A) WHILE CONSIDERING THE TOTAL NUMBER OF 10 PLOTS AS DISCUSSED AND APPEARING IN PARA 6.8.4 AT PAGE NO.29 OF THE APPELLATE ORDER AS REPRODUCED ABOVE. THEREFORE, WE ARE OF THE CONSIDERED OPINION THAT THE LD.CIT(A) HAS ANALYZED ALL THE ENTRIES APPEARING IN THE IMPOUNDED MATERIAL AND ALSO HAVE OBTAINED THE REMAND REPORT FROM THE AO. THEREFORE, SINCE THE FACTUAL ASPECTS HAS BEEN EXAMINED BY THE LD.CIT(A), HENCE WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF LD.CIT(A), ACCORDINGLY RESTRICTION THE ADDITION OF UNACCOUNTED INCOME OF RS.34,82,000/-, 1,42,60,000/- AND RS.5,43,49,000/- TO RS.1,34,86,000/- IS CORRECTLY FOUND TO BE CORRECT. IN VIEW OF THIS MATTER, WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF LD.CIT(A), ACCORDINGLY GROUND NO.5 OF THE REVENUE APPEAL IS THEREFORE DISMISSED. WITH REGARD TO CLAIM OF BENEFIT OF TELESCOPING OUT OF REMAINING ADDITION OF RS.74,66,000/-. WE ARE OF THE VIEW THAT THE SAME IS REQUIRED TO BE CO-RELATED WITH THE AMOUNT OF RECEIVED FROM THE PROSPECTIVE BUYERS AT THE TIME OF BOOKING. THIS ASPECT HAS NOT BEEN EXAMINED BY GHANSHYAM DUNGARBHAI SUTARIYA V. ACIT-8-SURAT /I.T.A. NO.1615 & 1730/AHD/2014/A.Y.09-10 PAGE 32 OF 52 THE LOWER AUTHORITIES. ACCORDINGLY, SET-ASIDE FOR LIMITED PURPOSE TO THE FILE OF THE ASSESSING OFFICER, FOR EXAMINATION IF THERE IS ANY CO-RELATION BETWEEN INCOME OF RS.74.66 LAKHS GENERATED AND SAID AMOUNT WAS AVAILABLE FOR SET-OFF AGAINST THE AMOUNT PAID. THE ASSESSING OFFICER WILL EXAMINE THE CLAIM OF CASH FLOW FUND OUT OF WHICH, HOW MUCH AMOUNT CAN BE TELESCOPED BY WAY OF THESE PAYMENTS. THEREFORE, THIS GROUND IS SET-ASIDE FOR LIMITED VERIFICATION. ACCORDINGLY, THIS GROUND OF THE ASSESSEE IS DISMISSED WITH LIMITED VERIFICATION AND GROUND NO.5 OF THE REVENUE IS DISMISSED. 28. GROUND NO.(IV) RELATES TO ENHANCEMENT OF INCOME OF RS.38,90,500/- BY THE LD. CIT(A). 29. DURING THE COURSE OF APPELLATE PROCEEDINGS, IT WAS NOTICED THAT THE ASSESSEE HAD CREDIT ENTRY WITH SURAT PEOPLES CO-OPERATIVE BANK AMOUNTING TO RS.2.71 CRORES. THE PERUSAL OF THE SAME REVEALED THAT THE AMOUNT OF RS.1.90 CRORE HAS BEEN RECEIVED FROM M/S.SHRADHA DEVELOPERS ON ACCOUNT OF SALE OF LAND. SIMILARLY, THE AMOUNT OF RS.56,60,000/- HAS BEEN TRANSFERRED FROM THE BANK ACCOUNT NO.SB-37906 IN SURAT PEOPLES CO-OPERATIVE BANK IN THE NAME OF SMT. RAMUBEN (MOTHER OF THE APPELLANT) WHO HAS BEEN ASSESSED TO TAX AND SUCH TRANSACTION HAS BEEN REFLECTED IN THE RETURN OF INCOME. HOWEVER, AN AMOUNT OF RS.4,85,000/- HAS BEEN TRANSFERRED FROM THE BANK ACCOUNT OF RASILABEN (WIFE OF THE ASSESSEE) WHO IS CLAIMED TO BE ASSESSED TO TAX. HOWEVER, THE ASSESSEE WAS UNABLE TO FURNISH COPY OF BANK STATEMENT OF HIS WIFE TO GHANSHYAM DUNGARBHAI SUTARIYA V. ACIT-8-SURAT /I.T.A. NO.1615 & 1730/AHD/2014/A.Y.09-10 PAGE 33 OF 52 SUBSTANTIATE THE CLAIM. THEREFORE, IN ABSENCE OF ANY EVIDENCE, THE AMOUNT OF RS.14,85,000/- CLAIMED TO HAVE BEEN RECEIVED FROM HIS WIFE SMT.RASILA BEEN WAS CONSIDERED AS FROM UNDISCLOSED SOURCE AND ADDED TO THE TOTAL INCOME OF THE ASSESSEE. IN ADDITION TO THIS, THERE WAS AN AMOUNT OF CASH DEPOSIT OF RS.24,05,500/- FOR WHICH THE APPELLANT HAS NOT GIVEN ANY EXPLANATION, HENCE, SAME WAS ALSO TREATED AS UNDISCLOSED INCOME OF THE ASSESSEE. ACCORDINGLY, AN ENHANCEMENT OF RS.38,90,500/- WAS MADE U/S.251(1) R.W.S 251(2) OF THE ACT ON ACCOUNT OF CASH DEPOSIT. 30. BEING AGGRIEVED, THE ASSESSEE HAS FILED AN APPEAL BEFORE THIS TRIBUNAL. THE LD.COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE MONEY OF RS.14,85,000/- RECEIVED BY CHEQUE FROM HIS WIFE. THEREFORE, NO ADDITION CAN BE MADE IN RESPECT OF THE AMOUNT RECEIVED BY THE ASSESSEE. THE AO/CIT(A) SHOULD HAVE CHECKED THIS WITH BANK STATEMENT OF THE ASSESSEE AND NOT HIS WIFES ACCOUNT. THE ONUS WAS ON THE DEPARTMENT TO PROVE THAT MONEY RECEIVED BY TRANSFER ENTRY IS BELONGS TO ASSESSEE. IN SUPPORT OF THIS CONTENTION, THE LD.COUNSEL FOR THE ASSESSEE HAS PLACED RELIANCE IN THE CASE OF CIT V. RANCHHOD JIVABHAI NAKHAVA [2012] 81 CCH 193 GUJ-HC / 21 TAXMANN.COM 159 (GUJARAT) [2012] 208 TAXMAN 35 (GUJARAT) AND CIT VS. SHAILESH KUMAR RASIKLAL MEHTA [2014] 224 TAXMAN 212 GUJ WHEREIN IT WAS HELD THAT ALL THE TRANSACTIONS ROUTED THROUGH BANK CHANNEL AND THE ASSESSEE HAS DULY EXPLAINED SOURCE OF INCOME THEN THE AO WAS NOT JUSTIFIED IN TREATING THE SAME AS UNDISCLOSED INCOME AND MAKING ADDITION U/S.68 OF THE ACT. FURTHER, AS AN ALTERNATIVE SUBMISSION, THE GHANSHYAM DUNGARBHAI SUTARIYA V. ACIT-8-SURAT /I.T.A. NO.1615 & 1730/AHD/2014/A.Y.09-10 PAGE 34 OF 52 LD.COUNSEL SUBMITTED THAT IF THE ADDITION IS SUSTAINED THEN THE SET-OFF OUT OF RS.10 LAKHS RECEIVED ON PART OF SALE CONSIDERATION OF RS.1,90,00,000/- SHOULD BE ALLOWED. 31. PER CONTRA , THE LD. CIT-DR SUBMITTED THAT THE ASSESSEE HAS NOT BEEN ABLE TO EXPLAIN THE SOURCE OF THE AMOUNT RECEIVED BY PRODUCING NECESSARY EVIDENCE IN RESPECT OF HIS WIFE SMT. RASILABEN, THEREFORE THE ASSESSEE FAILED TO DISCHARGE THE ONUS CAST UPON HIM, HENCE THE CASE LAWS RELIANCE PLACED BY LD.COUNSEL ARE NOT APPLICABLE. 32. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. WE FIND THAT THE AMOUNT OF RS.14,85,000/- HAS BEEN TRANSFERRED FROM THE BANK ACCOUNT OF SMT. RASILA BEN, (WIFE OF THE ASSESSEE). IT HAS BEEN CONTENDED THAT THE WIFE OF THE ASSESSEE IS ASSESSED TO INCOME TAX AND HAS FILED HER TAX RETURN AND IT HAS BEEN REFLECTED IN THE RETURN OF INCOME. HOWEVER, THE ASSESSEE WAS UNABLE TO FURNISH THE COPY OF BANK STATEMENT OF HIS WIFE TO SUBSTANTIATE HIS CLAIM. THEREFORE, WE ARE OF THE VIEW THAT THE ASSESSEE HAS FAILED TO DISCHARGE THE ONUS CAST UPON HIM. THE LD. COUNSEL HAS PLACED THE RELIANCE ON JUDGEMENT OF THE HON'BLE GUJARAT HIGH COURT IN THE CASE OF CIT VS. SHAILESH R MEHTA (SUPRA) WHEREIN IT WAS HELD THAT ADDITION ON ACCOUNT OF UNEXPLAINED CASH CREDIT CANNOT BE MADE IF THE TRANSACTION WERE ROUTED THROUGH BANK AND THE ASSESSEE EXPLAINED THE SOURCE OF INCOME. HOWEVER, IN THE PRESENT CASE EXCEPT THE CLAIMING THAT THE AMOUNT WAS TRANSFERRED THROUGH BANK ACCOUNT OF HIS WIFE, NO DETAILS OF SUCH BANK ACCOUNT HAS BEEN FURNISHED BEFORE THE AUTHORITIES. THEREFORE, THE CLAIM OF THE ASSESSEE THAT TRANSACTION HAS BEEN GHANSHYAM DUNGARBHAI SUTARIYA V. ACIT-8-SURAT /I.T.A. NO.1615 & 1730/AHD/2014/A.Y.09-10 PAGE 35 OF 52 REFLECTED AND SHOWN BY THE SMT. RASIABEN, IN HER RETURN OF INCOME IS REMAINED TO BE SUBSTANTIATED. THEREFORE, THIS DECISION IS DISTINGUISHABLE ON THE FACTS OF THE PRESENT CASE. SIMILARLY, THE ASSESSEE HAS NOT FURNISHED ANY CONFIRMATION NOR THE SUCH AMOUNT HAS BEEN SHOWN BY THE ASSESSEE. THEREFORE, THE DECISION IN THE CASE OF CIT V. RANCHHOD JIVABHAI NAKHAVA [2012] 81 CCH 193 GUJ-HC / 21 TAXMANN.COM 159 (GUJARAT) [2012] 208 TAXMAN 35 (GUJARAT) (SUPRA) IS ALSO NOT APPLICABLE IN TO THE FACTS AND CIRCUMSTANCES OF THE PRESENT CASE. WE FURTHER NOTICE THAT THE ASSESSEE HAS FAILED TO FURNISH ANY EXPLANATION WITH REGARD TO SOURCE OF CASH DEPOSIT OF RS.24,04,500/-. THEREFORE, IN ABSENCE OF ANY EVIDENCE ON RECORD TO SUBSTANTIATE THE CLAIM MADE BY THE ASSESSEE, WE ARE NOT INCLINED TO AGREE WITH HIS VERSION. WE ALSO NOTE THAT CLAIM OF THE ASSESSEE THAT A SUM OF RS. 10 LAKH RECEIVED AS PART OF SALE CONSIDERATION OF RS. 1.90 CRORES FROM SHRADDA DEVELOPER WAS AVAILABLE IS ALSO NOT FOUND ACCEPTABLE, AS THE PROPERTY SOLD IN QUESTION WAS BELONGING TO THE ASSESSEE AND NOT OF SMT. RASILABEN FROM WHOM THE RECEIPTS HAS BEEN CLAIMED BY THE ASSESSEE. THEREFORE, SAME CANNOT BE SET-OFF AGAINST THE RECEIPTS FROM RASILABEN. MOREOVER, NO SUCH CLAIM WAS EMANATING FROM THE FINDINGS OF CIT(A). IN VIEW OF THESE FACTS AND CIRCUMSTANCES, WE FIND THAT THE ACTION OF THE LD. CIT(A) IN MAKING ENHANCEMENT OF THE INCOME AS JUST AND PROPER. CONSIDERING THE TOTALITY OF THE FACTS AND CIRCUMSTANCES, WE DO NOT HAVE ANY REASON TO DEVIATE FROM THE FINDINGS OF LD. CIT(A). IN VIEW OF THIS, THE ADDITION OF RS.38,98,500/- MADE ON ACCOUNT OF ENHANCEMENT OF INCOME BY THE LD. GHANSHYAM DUNGARBHAI SUTARIYA V. ACIT-8-SURAT /I.T.A. NO.1615 & 1730/AHD/2014/A.Y.09-10 PAGE 36 OF 52 CIT(A) IS UPHELD. CONSEQUENTLY, THIS GROUND OF APPEAL OF THE ASSESSEE IS ACCORDINGLY, DISMISSED. 33. GROUND NO.(V.) RELATES TO ADJUSTMENT OF UNACCOUNTED RECEIPTS / UNACCOUNTED EXPENDITURE. 34. THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE ASSESSEE BE ALLOWED TELESCOPING AND ADJUSTMENT OF LOANS OF RS. 4 LAKH IN RESPECT OF GROUND NO. (II) AND RS.1,34,86,000/- IN GROUND NO. (III) IF SUSTAINED AS AGAINST UNACCOUNTED INCOME OF RS.86,44,340/- IF SUSTAINED IN RESPECT OF GROUND NO. 1 ABOVE , WHICH IS CLAIMED TO HAVE BEEN RECEIVED DURING THE PERIOD APRIL 2008 TO DECEMBER 2008 THAT AMOUNT SHOULD BE CONSIDERED AS AVAILABLE TO THE APPELLANT FOR REPAYMENT TO THE BUYERS AGGREGATING TO RS.1,34,86,000/-. IT WAS FURTHER SUBMITTED THAT THE ASSESSEE HAS PAID INTEREST OF RS.60,20,000 /- AS COMPENSATION TO BUYERS OF PLOT ON RETURN OF MONEY BECAUSE THE APPELLANT COULD NOT GET CLEARANCE AND IN THIS BUSINESS VENTURES. THEREFORE, THE INTEREST BEING A BUSINESS LOSS WOULD BE DEDUCTIBLE FOR THE AMOUNT OF RS.1,34,86,000/- WHICH HAS BEEN INCLUDED IN ADDITION OF RS. RS.1,34,86,000/-. THE LEARNED COUNSEL FOR THE ASSESSEE ALSO CLAIMED SET-OFF RS. 4 LAKH BEING LOAN AS PER GROUND NO. (II) ABOVE. FURTH SET-OFF OUT CASH AVAILABILITY OF RS. 10 LAC CLAIMED TO HAVE RECEIVED AS PART OF SALE CONSIDERATION OF RS.1,90,00,000/-. 35. THE LD. CIT (DR) SUBMITTED THAT THERE IS NO CO-RELATION BETWEEN INCOME ESTIMATED AND REPAYMENT NOR SUCH GROUNDS OF APPEAL IS TAKEN BEFORE CIT(A). GHANSHYAM DUNGARBHAI SUTARIYA V. ACIT-8-SURAT /I.T.A. NO.1615 & 1730/AHD/2014/A.Y.09-10 PAGE 37 OF 52 36. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE RELEVANT MATERIAL ON RECORD. WE HAVE ALREADY GIVEN DIRECTION TO THE ASSESSING OFFICER TO VERIFY THE CLAIM OF TELESCOPING OF RS.4 LAKHS IN GROUND NO.(II) ABOVE AND RS.1,34,86,000/- IN GROUND NO.(III) WHILE DEALING THESE GROUNDS OF APPEAL. THE SET-OFF OF RS.10 LAKHS OF CASH AVAILABILITY IS ALSO STANDS DECIDED. HENCE, THIS GROUND IS COVERED BY ABOVE GROUNDS, HENCE, DOES NOT REQUIRE SPECIFIC ADJUDICATION. 37. GROUND NO. (VI) RELATES TO CHARGING OF INTEREST WITHOUT SPECIFYING AS TO WHICH INTEREST IS CHARGEABLE. 38. WE ARE OF THE VIEW THAT THIS GROUND IS CONSEQUENTIAL IN NATURE, HOWEVER, WE MAKE IT CLEAR THAT THE CHARGING OF INTEREST IS MANDATORY AS HELD BY HON`BLE SUPREME COURT IN THE CASE OF ANJUM M. H. GHASWALA 252 ITR 1 (SC). THEREFORE, IT IS UPHELD SUBJECT TO CONSEQUENTIAL RELIEF IF ANY. NOW WE WILL TAKE UP REVENUE APPEAL IN I.T.A.NO. 1730/AHD/2014/A.Y. 2009-10 (BY THE REVENUE): 39. GROUND NO. 1 RELATES TO DELETION OF ADDITION OF RS.4,82,56,000/- MADE ON ACCOUNT OF UNACCOUNTED LOANS, ADVANCES, AND INTEREST, WITHOUT APPRECIATING THE FACTS THAT IN SPITE OF AVAILING SUFFICIENT OPPORTUNITY, THE ASSESSEE FAILED TO PRODUCE ANY EXPLANATION. GHANSHYAM DUNGARBHAI SUTARIYA V. ACIT-8-SURAT /I.T.A. NO.1615 & 1730/AHD/2014/A.Y.09-10 PAGE 38 OF 52 40. THE AO OBSERVED THAT PERUSAL OF BF-2, PAGE NO. 57 SHOWED THAT LOANS HAVE BEEN ADVANCED TOTALING TO RS.3,91,00,000/- WITH ANNUAL INTEREST OF RS.91,56,000/-. IN ABSENCE OF ANY EXPLANATION FILED BY THE ASSESSEE, THE LOANS AND ADVANCES AND INTEREST AMOUNTING TO RS.4,82,56,000/- [ 3,91,00,000 + 91,56,000] WERE TREATED AS UNACCOUNTED INCOME OF THE ASSESSEE. 41. BEING AGGRIEVED, THE ASSESSEE FILED AN APPEAL BEFORE THE LD. CIT(A). IN APPEAL, IT WAS SUBMITTED THAT BF-2, PAGE NO. 57 CONTAINS DETAILS OF PROBABLE LOAN GIVERS TO THE ASSESSEE AND PROBABLE INTEREST PAYABLE @2%. A CHART OF SUCH DETAILS WERE FILED BEFORE CIT(A) WHICH IS APPEARING AT PARA 6.3.3. OF APPELLATE ORDER. IT WAS CONTENDED THAT THE COLUMN 6 & 7 OF CHART HAVING TITLE OF PAYABLE DATE OF INTEREST AND PAYABLE INTEREST, WHICH IS BLANK. HENCE, THE ASSESSEE HAS NEITHER RECEIVED LOAN NOR PAID ANY INTEREST THEREON. IT WAS FURTHER SUBMITTED THAT PAGE-II OF A-1 TO A-13 ARE CONFIRMATION OF ALL SUCH PARTIES, WHO HAVE DENIED HAVING ANY FINANCIAL TRANSACTION WITH THE APPELLANT. THE ASSESSEE HAS ALSO FILED CONFIRMATION FROM 6 PARTIES IN RESPECT OF ABOVE 14 PERSONS MENTIONED IN THE CHART. ONE PERSON HAVE EXPIRED OF WHICH DEATH CERTIFICATE WAS PRODUCED. THUS, IT WAS CONTENDED THAT IT WAS A PROBABLE RECEIPTS AND NOT ACTUAL RECEIPT. THE LD.AO HAS NOT FOUND ANY SINGLE EVIDENCE TO PROVE THAT SUCH AMOUNT HAS BEEN ACTUALLY TAKEN BY THE ASSESSEE. A REMAND REPORT WAS OBTAINED FROM THE AO IN THIS REGARD IN WHICH THE AO HAS NOT BROUGHT ON RECORD ANY SUCH FACT TO CONTRADICT THE SUBMISSIONS MADE BY THE APPELLANT. IN VIEW OF THESE FACTS, THE CIT(A) OBSERVED THAT PAYABLE DATE OF INTEREST AND THE AMOUNT OF INTEREST PAYABLE IS BLANK IN GHANSHYAM DUNGARBHAI SUTARIYA V. ACIT-8-SURAT /I.T.A. NO.1615 & 1730/AHD/2014/A.Y.09-10 PAGE 39 OF 52 THE IMPOUNDED PAPERS AND DENIAL OF THE PERSONS WHOSE NAMES ARE APPEARING ON THE SHEET INDICATES THAT THE SUBMISSIONS MADE BY THE APPELLANT REGARDING PROBABLE LOANS IS CORRECT. IN VIEW OF THESE FACTS AND CIRCUMSTANCES, THE ADDITION MADE BY THE AO WAS DELETED. 42. BEING AGGRIEVED, THE REVENUE HAS FILED THIS APPEAL BEFORE THE TRIBUNAL. THE LD. CIT (DR) SUBMITTED THAT JUST BECAUSE THE TWO COLUMNS ARE LEFT BLANK. THE CIT(A) VIEWED IT AS PROBABLE LOAN AND INTEREST CALCULATION WHEREAS THE ASSESSEE HAS NOT PRODUCED THE PARTIES BEFORE THE AO. THE FIGURES MENTIONED ON THE IMPOUNDED PAGE ARE NOT IMAGINARY AS SPECIFIC INTEREST RATE AND NAME OF PERSON IS MENTIONED. THEREFORE, PRESUMPTION GOES IN FAVOUR OF THE REVENUE. 43. AU CONTRAIRE, THE LEARNED COUNSEL FOR THE ASSESSEE SUPPORTED THE ORDER OF CIT(A) AND SUBMITTED THAT THE SHEET IMPOUNDED IS COMPUTATION SHEET OF PROBABLE LENDERS. FURTHER, OUT OF 14 PERSON, SIX (6) PERSON HAVE DENIED TO HAVE ANY TRANSACTION WITH THE ASSESSEE. NOR THE AO HAS BROUGHT ANY RECORDS/ EVIDENCE CONTRARY IN HIS REMAND REPORT. 44. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE RELEVANT MATERIAL ON RECORD. WE FIND THAT THE IMPOUNDED SHEET CONTAINED NAME OF PROBABLE LENDERS AS DATE OF INTEREST COLUMN DATED AND AMOUNT OF INTEREST PAYABLE HAS BEEN FOUND AS BLANK. FURTHER, SIX PERSONS MENTIONED IN THE CHART HAVE DENIED TO HAVE DONE ANY FINANCIAL TRANSACTIONS WITH THE ASSESSEE. THE AO HAS WRONGLY TREATED THESE AS LOANS GIVEN GHANSHYAM DUNGARBHAI SUTARIYA V. ACIT-8-SURAT /I.T.A. NO.1615 & 1730/AHD/2014/A.Y.09-10 PAGE 40 OF 52 WHEREAS THE LIST/ CHART INDICATES PROBABLE LENDERS. WE FIND THAT THE AO HAS NOT BROUGHT ON RECORD ANYTHING CONTRARY TO THE SUBMISSIONS MADE BY THE ASSESSEE. THEREFORE, IN SUCH CIRCUMSTANCES, WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF CIT(A), ACCORDINGLY, SAME IS UPHELD. THIS GROUND OF APPEAL OF REVENUE IS THEREFORE, DISMISSED. 45. GROUND NO.2 RELATES DELETION OF ADDITION OF RS.1,50,00,000/- MADE ON ACCOUNT OF UNACCOUNTED INCOME WITHOUT APPRECIATING FACT THAT THE ASSESSEE WAS NOT ABLE TO EXPLAIN THE DETAILS OF CHEQUES IMPOUNDED FROM HIS PREMISES. 46. BRIEF FACTS AS STATED ARE THAT THE ANX-BF-2 PAGE NO. 40 SHOWED CHEQUES IN THE NAME OF FIVE PARTIES, NAMELY RAMANBHAI M PATEL, RS. 15 LAKH EACH ON 21.03.2008 AND 27.03.2008, SURESHCHAND M PATEL OF RS. 15 LAKHS EACH ON 21.03.2008 AND 26.03.2008, CHANDRAKANT M PATEL OF RS.15 LAKH EACH ON 23.03.2008 AND 27.03.2008, KIRITKUMAR M PATEL OF RS.15 LAKH EACH ON 24.03.2008 AND 27.03.2008 AND VINODKUMAR M PATEL OF RS.15 LAKHS EACH ON 24.03.2008 AND 28.03.2008 UNDER THE HEAD OF CHEQUE SYSTEM OF DHARAM BHAKTI IN THE MONTH OF MARCH 2008 AGGREGATING TO RS.1,50,00,000. IN ABSENCE OF ANY EXPLANATION FROM THE ASSESSEE, THE AO MADE ADDITION OF THE SAID AMOUNT AS UNACCOUNTED INCOME. 47. BEING AGGRIEVED, THE ASSESSEE FILED AN APPEAL BEFORE THE LD.CIT(A). THE LD.CIT(A) OBSERVED THAT DURING THE COURSE OF REMAND PROCEEDINGS, THE APPELLANT WAS AGAIN SHOWN COMPUTER PRINTOUT OF IMPOUNDED BF-2 PAGE NO. 40 AND ASKED TO GO GHANSHYAM DUNGARBHAI SUTARIYA V. ACIT-8-SURAT /I.T.A. NO.1615 & 1730/AHD/2014/A.Y.09-10 PAGE 41 OF 52 THROUGH THE SAID IMPOUNDED COMPUTER PRINTOUT. IN REPLY TO QUESTION NO. 19, THE APPELLANT HAS STATED THAT THE COMPUTER PRINTOUT DOES NOT BELONG TO HIM. HE ALSO STATED THAT HE HAD NEVER ENTERED IN TO ANY TRANSACTION WITH THEM. HE ALSO STATED THAT HE OR HIS FAMILY MEMBERS ARE NOT HAVING BANK ACCOUNT WITH BHAVNAGAR DISTRICT CO- OPERATIVE BANK LTD. THE AO HAD EXAMINED THE BANK ACCOUNT STATEMENT OF SURAT PEOPLES CO-OPERATIVE BANK LTD. DURING THE COURSE OF REMAND PROCEEDINGS AND FOUND THAT NO CHEQUE AMOUNTING TO RS. 1,50,00,000 WAS DEPOSITED / WITHDRAWN FROM THE APPELLANT`S BANK ACCOUNT. THEREFORE, CIT(A) HELD THAT IN ABSENCE OF ANY CORROBORATING EVIDENCES IN SUPPORT OF THE ENTRIES IN IMPOUNDED DOCUMENTS, NO ADDITION COULD BE MADE. ACCORDINGLY, THIS GROUND OF APPEAL WAS ALLOWED. 48. BEING AGGRIEVED, THE REVENUE HAS FILED THIS APPEAL BEFORE THE TRIBUNAL. THE LD. CIT (DR) SUBMITTED THAT THE AO HAS SUBMITTED IN REMAND REPORT THAT NO CHEQUES HAVE BEEN DEPOSITED IN BANK ACCOUNT OF THE ASSESSEE WITH SURAT PEOPLES CO-OPERATIVE BANK LTD., HENCE, THE ADDITION SO MADE WAS DELETED. THE ASSESSEE HAS CLAIMED THAT COMPUTER PRINTOUT DOES NOT BELONGS TO HIM; HENCE, HE IS NOT AWARE OF THESE ENTRIES. HOWEVER, IN ANOTHER GROUNDS OF APPEAL, THE CIT(A) HAS ACCEPTED THAT COMPUTER PRINTOUT IS PRESUMED TO BELONGING TO THE ASSESSEE. THEREFORE, IN SUCH A SITUATION, THE CONCLUSION ARRIVED AT BY THE CIT(A) IS NOT CORRECT. 49. PER CONTRA , THE LEARNED COUNSEL FOR THE ASSESSEE THE ASSESSEE AND HIS FAMILY MEMBERS DO NOT HAVE ANY BANK ACCOUNT WITH BHAVNAGAR DISTRICT CO-OPERATIVE BANK GHANSHYAM DUNGARBHAI SUTARIYA V. ACIT-8-SURAT /I.T.A. NO.1615 & 1730/AHD/2014/A.Y.09-10 PAGE 42 OF 52 LTD., WHICH HAS BEEN ACCEPTED BY THE AO AND CIT(A). THE AO IN HIS REMAND REPORT CONFIRMED THE FACT THAT NO CHEQUE OF RS.1.50 CRORE WAS DEPOSITED IN ASSESSEE`S BANK ACCOUNT WITH SURAT PEOPLES CO-OPERATIVE BANK LTD. THEREFORE, THE LD. CIT(A) WAS JUSTIFIED IN DELETING THE ADDITION SO MADE. 50. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE RELEVANT MATERIAL ON RECORD. WE FIND THAT BF-2 PAGE NO. 40 REFLECTED 10 NUMBER CHEQUES OF RS. 15 LAKH EACH IN RESPECT OF FIVE PERSON. THESE CHEQUES WERE PERTAINING TO BHAVNAGAR DISTRICT CO-OPERATIVE BANK LTD. WITH WHOM THE ASSESSEE, NOR ANY OF HIS FAMILY MEMBERS WERE HAVING ANY BANK ACCOUNT. FURTHER, SUCH CHEQUES WERE NOT CLEARED OR DEPOSITED WITH BANK ACCOUNT OF THE ASSESSEE MAINTAINED WITH SURAT PEOPLES CO-OPERATIVE BANK LTD. THESE FACTS STANDS VERIFIED BY THE AO DURING REMAND REPORT PROCEEDINGS AND BY LD. CIT(A) IN APPELLATE PROCEEDINGS. THEREFORE, IN ABSENCE OF ANY CORROBORATING EVIDENCES, THE ADDITION MADE BY THE AO IN RESPECT OF CHEQUE ENTRIES HAS BEEN RIGHTLY DELETED. HAVING CAREFUL CONSIDERATION OF FACTS AND CIRCUMSTANCES, WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF CIT(A), ACCORDINGLY, IT IS UPHELD. ACCORDINGLY, THIS GROUNDS OF APPEAL OF REVENUE IS THEREFORE, DISMISSED. 51. GROUND NO.3 STATES THAT THE LD. CIT(A) HAS ERRED IN DELETING ADDITION MADE ON ACCOUNT OF UNACCOUNTED INCOME OF RS.12,63,96,132/- AND ADDITION OF RS.40,27,600/- MADE ON ACCOUNT OF ON-MONEY RECEIPTS WITHOUT APPRECIATING THE GHANSHYAM DUNGARBHAI SUTARIYA V. ACIT-8-SURAT /I.T.A. NO.1615 & 1730/AHD/2014/A.Y.09-10 PAGE 43 OF 52 FACT THAT THE ASSESSEE HAS FAILED TO PRODUCE ANY EXPLANATION REGARDING THE ON- MONEY RECEIPTS REFLECTED IN SEIZED MATERIAL FROM HIS RESIDENCE. 52. BRIEF FACT OF THIS GROUND ARE THAT ON VERIFICATION OF BF-2, PAGE NO. 1 TO 39, THE AO NOTED THAT IT IS THE RECEIPTS FROM SALE MADE IN SARJAN AGAINST PLOT NOS. 1 TO 60 ( 1 ST , 2 ND & 3 RD GATE) TOTALING TO RS.5,07,49,209/- AND PLOT NOS. 1 TO 101A ( 4 TH GATE) TOTALING TO RS.7,56,46,923/- PLUS ON-MONEY RECEIPTS OF RS.40,27,600/- ON SALE OF 28029.76 SQ. YDS., INVOLVING GROSS TOTAL SUM OF RS.12,63,96,132/- AND ON-MONEY OF RS.40,27,600/-. IN ABSENCE OF ANY EXPLANATION FILED BY THE ASSESSEE, THE AO ADDED THE SAME AS UNACCOUNTED INCOME OF THE ASSESSEE. 53. BEING AGGRIEVED, THE ASSESSEE FILED AN APPEAL BEFORE THE LD. CIT(A). BEFORE WHOM THE ASSESSEE HAS TAKEN THE PLEA THAT THE IMPOUNDED BF-2 PAGE NO. 1 TO 39 DOES NOT RELATED TO THE APPELLANT. THESE PAPERS ARE REFLECTING NAME OF 170 PERSONS AGAINST WHOM DETAILS ARE MENTIONED. THE AO, DURING REMAND REPORT PROCEEDINGS HAD MADE ENQUIRIES ON THE BASIS OF ADDRESS AVAILABLE ON RECORD, DETAILS WERE CALLED FOR UNDER SECTION 133(6) OF THE ACT FROM SMT. KIRTIBEN VISHRAMBHAI MORADIA, SHRI VISHRAMBHAI KANJIBHAI MORADIA, SMT. JAGRUTIBEN JITENDRA NAVADIYA , SHRI RAMESBHAI DIYABHAI GOYANI, WHOSE NAMES WERE REFLECTING IN SARAJN AND ASKED TO FURNISH DETAILS OF ADDRESS OF SARJAN, COPY OF SALE DEED , PAYMENT DETAILS WITH SARJAN AND TRANSACTION CARRIED OUT WITH THE ASSESSEE DURING PERIOD FROM 01.04.2008 TO 31.03.2009 WITH DETAILS OF IT RETURNS, PAN AND PHOT IDENTITY PROOF. THE AO HAS GHANSHYAM DUNGARBHAI SUTARIYA V. ACIT-8-SURAT /I.T.A. NO.1615 & 1730/AHD/2014/A.Y.09-10 PAGE 44 OF 52 REPORTED THAT THE ABOVE-MENTIONED PARTIES SUBMITTED THEIR REPLIES WHEREIN THEY HAVE STATED THAT SARJAN IS REGISTERED CO-OPERATIVE SOCIETY WITH THE NAME OF SARJAN (KATRAGAM) CO-OPERATIVE HOUSING SOCIETY LTD. INCORPORATED ON 20.10.2004, SITUATED A LAXMIKANT ROAD, KATARGAM, SURAT. IT WAS NOTICED THAT SHRI PARESHBHAI DAVERA (PATEL) SIGNED THE CERTIFICATE AS PRAMUKH. THEREFORE, SUMMONS UNDER SECTION 131 OF THE ACT WAS ISSUED TO PARESHBHAI PATEL, WHOSE STATEMENT WAS RECORDED ON 04.12.2012 IN WHICH HE STATED THAT SHRI GHANSHYAMBHAI D SUTARIYA IS HAVING NO CONNECTION WITH HIS SOCIETY. HE IS NEITHER MEMBER NOR HOLDING ANY PLOT IN SARJAN SOCIETY HE DOES NOT KNOW AS TO HOW THE PAPERS OF SARJAN WERE FOUND DURING SURVEY AT THE PREMISES OF GHANSHYAM D SUTARIYA. THE OTHER MEMBERS FROM WHOM INFORMATION WAS COLLECTED UNDER SECTION 133(6) OF THE ACT ALSO DENIED OF KNOWING THE APPELLANT OR HAVING ANY TYPE OF FINANCIAL TRANSACTIONS WITH THE APPELLANT. IN VIEW OF THESE FACTS, THE CIT(A) OBSERVED THAT THE APPELLANT HAS IN NO WAY ASSOCIATED WITH SARJAN CO-OPERATIVE SOCIETY. HOWEVER, THE QUESTION REMAINS, UNANSWERED THAT HOW THESE PAPERS FOUND IN POSSESSION OF THE APPELLANT. HOWEVER, NO DETAILS OF ANY FINANCIAL TRANSACTIONS RECORDED IN THE BOOKS OF ACCOUNTS OF THE APPELLANT COULD BE FOUND IN THE REMAINING IMPOUNDED DOCUMENTS. THE ENQUIRIES MADE BY THE AO REVEALED THAT THE APPELLANT HAS NO RELATIONSHIP WITH SARJAN SOCIETY. THEREFORE, NO ADDITION ON ACCOUNT OF UNACCOUNTED INCOME AND ON-MONEY OF RS.12,63,96,132/- AND RS.40,27,600/- CAN BE MADE IN THE HANDS OF THE APPELLANT. HOWEVER, THE CIT(A) HAS DIRECTED THE AO TO INFORM TO THE CONCERNED AO FOR TAKING NECESSARY ACTION IN RESPECT GHANSHYAM DUNGARBHAI SUTARIYA V. ACIT-8-SURAT /I.T.A. NO.1615 & 1730/AHD/2014/A.Y.09-10 PAGE 45 OF 52 OF 170 PERSON IN RESPECT OF FINANCIAL TRANSACTION AND ON-MONEY PAID IN ACCORDANCE WITH LAW. IN VIEW OF THIS MATTER, THE ADDITION SO MADE WAS DELETED BY THE LD. CIT(A). 54. BEING AGGRIEVED, THE REVENUE HAS FILED THIS APPEAL BEFORE THE TRIBUNAL. THE LD. CIT (DR) SUBMITTED THE AO HAS MADE ADDITION AS NO EXPLANATION WAS FILED BY THE ASSESSEE IN THE COURSE OF ASSESSMENT PROCEEDINGS. THE CIT(A) HAS DELETED THE ADDITION BASED ON REMAND REPORT. THE CIT(A) SHOULD HAVE SUSTAINED ADDITION ON PROTECTIVE BASIS. THE LD. CIT (DR) THEREFORE, PLACED RELIANCE ON THE ORDER OF THE AO. 55. ON THE OTHER HAND, THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE ASSESSEE HAS NO RELATION WITH SARJAN SOCIETY, WHICH IS ALSO FOUND TO BE CORRECT BY THE CIT(A). FURTHER, SHRI PARESH PATEL, PRESIDENT OF SOCIETY, HAS DENIED HAVING ANY RELATION WITH THE ASSESSEE BY GIVING STATEMENT TO THE DEPARTMENT. IT WAS FURTHER STATED THAT VARIOUS MEMBERS OF SOCIETY HAVE ALSO CONFIRMED THAT THEY DO NOT KNOW THE APPELLANT AND THE APPELLANT DO NOT HAVE ANY RELATION WITH THE SOCIETY. ALL THE DOCUMENTS ARE ON RECORD AND NO DOCUMENTS SUGGESTS ANY INTEREST OF THE ASSESSEE IN ANY MANNER. THE LEARNED COUNSEL FOR THE ASSESSEE THEREFORE, SUPPORTED THE ORDER OF THE LD. CIT(A). 56. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE RELEVANT MATERIAL ON RECORD. WE FIND THAT THE AO HAS MADE ADDITION BASED ON IMPOUNDED ANX-BF-2 PAGE NO. 1 TO 39 WHICH REFLECTED THE PAYMENTS OF AND ON-MONEY IN RESPECT OF 170 PERSONS AGAINST WHOM DETAILS ARE MENTIONED. HOWEVER, DURING THE REMAND REPORT GHANSHYAM DUNGARBHAI SUTARIYA V. ACIT-8-SURAT /I.T.A. NO.1615 & 1730/AHD/2014/A.Y.09-10 PAGE 46 OF 52 PROCEEDINGS, THE AO HAD MADE ENQUIRIES ON THE BASIS OF ADDRESS AVAILABLE ON RECORD, DETAILS WERE CALLED FOR UNDER SECTION 133(6) OF THE ACT FROM SMT. KIRTIBEN VISHRAMBHAI MORADIAM, SHRI VISHRAMBHAI KANJIBHAI MORADIA, SMT. JAGRUTIBEN JITENDRA NAVADIYA , SHRI RAMESBHAI DIYABHAI GOYANI, WHOSE NAMES WERE REFLECTING IN SARAJN AND ASKED TO FURNISH DETAILS OF ADDRESS OF SARJAN, COPY OF SALE DEED, PAYMENT DETAILS WITH SARJAN AND TRANSACTION CARRIED OUT WITH THE ASSESSEE DURING PERIOD FROM 01.04.2008 TO 31.03.2009 WITH DETAILS OF IT RETURNS, PAN AND PHOTO IDENTITY PROOF. THE AO HAS REPORTED THAT THE ABOVE-MENTIONED PARTIES SUBMITTED THEIR REPLIES WHEREIN THEY HAVE STATED THAT SARJAN IS REGISTERED CO-OPERATIVE SOCIETY WITH THE NAME OF SARJAN (KATRAGAM) CO-OPERATIVE HOUSING SOCIETY LTD. INCORPORATED ON 20.10.2004, SITUATED A LAXMIKANT ROAD KATARGAM SURAT. IT WAS NOTICED THAT SHRI PARESHBHAI DAVERA (PATEL) SIGNED THE CERTIFICATE AS PRAMUKH. THEREFORE, SUMMONS UNDER SECTION 131 OF THE ACT WAS ISSUED TO PARESH PATEL, WHOSE STATEMENT WAS RECORDED ON 04.12.2012 IN WHICH HE STATED THAT SHRI GHANSHYAMBHAI D SUTARIYA IS HAVING NO CONNECTION WITH HIS SOCIETY. HE IS NEITHER MEMBER NOR HOLDING ANY PLOT IN SARJAN SOCIETY. HE DO NOT KNOW AS TO HOW THE PAPERS OF SARAJN WERE FOUND DURING SURVEY AT THE PREMISES OF GHANSHYAM D SUTARIYA. THE OTHER MEMBERS FROM WHOM INFORMATION WAS COLLECTED UNDER SECTION 133(6) ALSO DENIED KNOWING THE APPELLANT OR HAVING ANY TYPE OF FINANCIAL TRANSACTIONS WITH THE APPELLANT. IN VIEW OF THESE FACTS, THE CIT(A) OBSERVED THAT THE APPELLANT HAS IN NO WAY ASSOCIATED WITH SARJAN CO-OPERATIVE SOCIETY. HAVING CAREFUL CONSIDERATION OF ABOVE FACTS, WE ARE OF THE GHANSHYAM DUNGARBHAI SUTARIYA V. ACIT-8-SURAT /I.T.A. NO.1615 & 1730/AHD/2014/A.Y.09-10 PAGE 47 OF 52 CONSIDERED OPINION THERE WAS NO CORROBORATING EVIDENCES ON RECORD, WHICH SUGGESTED THAT THE TRANSACTIONS, WERE RELATED TO IN ANY MANNER WITH THE ASSESSEE. IN VIEW OF THESE FACTS AND CIRCUMSTANCES, WE ARE OF THE CONSIDERED VIEW THAT LD. CIT(A) WAS NOT IN ERROR IN DELETING THE ADDITION SO MADE BY THE AO. THEREFORE, THIS GROUNDS OF APPEAL OF REVENUE IS ACCORDINGLY, DISMISSED. 57. GROUND NO. 4 RELATES TO DELETION OF ADDITION OF RS.97,24,958 ON ACCOUNT OF ALLEGED UNACCOUNTED EXPENDITURE WITHOUT APPRECIATING THAT THE ASSESSEE HAS GIVEN CONTRADICTORY STATEMENT EVEN WHILE ADMITTED THAT HE IS AN ORGANIZER OF THE MADHAV DARSHAN CO-OP HOUSING SOCIETY LTD. PROJECT. 58. BRIEF FACTS ARE THAT THE VERIFICATION OF BF-3 PAGE NO.119 REVEALED THAT THE NAME OF THE ASSESSEE IS MENTIONED AS ORGANIZER OF LAXMI DARSHAN COMPLEX SHOPPING CENTER. IT WAS FURTHER NOTICED THAT THE AREA OF SHOPS WAS REDUCED BY THE MUNICIPAL AUTHORITIES ON ACCOUNT OF ALIGNMENT AND PAYMENTS WAS TO BE MADE WITHIN 30 DAYS FOR 50% AND BALANCE 50% IN 60 DAYS IN RESPECT OF THESE SHOPS. ACCORDINGLY, THE ASSESSEE WAS ASKED TO SHOW CAUSE AS TO WHY THE AMOUNT MENTIONED AT PAGE NO.118 TO 112 AND PAGE NO.106, 104, 103 , 96 TO 93 ON WHICH DETAILS AND RATES ARE GIVEN, WHICH AMOUNTS RS.97,24,958/- SHOULD NOT BE ADDED AS UNEXPLAINED EXPENDITURE. IT WAS EXPLAINED THAT THE NAME OF THE ASSESSEE IS THERE AS ORGANIZER AND THERE IS NO FINANCIAL IMPLICATION THAT CAN BE DERIVED FROM THESE PAGES. HOWEVER, THE GHANSHYAM DUNGARBHAI SUTARIYA V. ACIT-8-SURAT /I.T.A. NO.1615 & 1730/AHD/2014/A.Y.09-10 PAGE 48 OF 52 AO VIEWED THAT IN ABSENCE OF ANY DETAILS OF SHOPS NOT BEING FURNISHED BY THE ASSESSEE. THE AMOUNT MENTIONED THIN AT RS. 97,24,958 WAS ADDED TO TOTAL INCOME. 59. BEING AGGRIEVED, THE ASSESSEE FILED AN APPEAL BEFORE THE LD. CIT(A). THE CIT(A) HAS CALLED FOR A REMAND REPORT FROM THE AO. THE AO IN HIS REMAND REPORT STATED IN REPLY TO QUESTION NO.8 AND 9, THAT THE APPELLANT HAS STATED THAT THESE PAPERS ARE RELATED TO LAXMI DARSHAN COMPLEX, WHICH WAS CONSTRUCTED BY MADHAV DARSHAN CO-OP HOUSING SOCIETY LTD. ONLY. SOME SHOPS WERE DEMOLISHED BY THE SMC AND A DISPUTE AROSE AMONG THE SOCIETY MEMBERS AND THE OWNERS OF THE SHOPS WHOSE SHOPS WERE DEMOLISHED BY THE SMC. TO SETTLE THIS DISPUTE THEY CALLED A MEETING (PANCHAYAT) AND HE (SHRI GHANSHYAMBHAI D SUTARIYA) WAS PRESENT THERE AS A PANCH. AFTER THE MEETING, ONE COPY OF THE DECISION TAKEN BY THE PANCHAYAT WAS GIVEN TO HIM. THE PAGES CONTAIN THE DETAILS OF PAYMENT TO BE MADE TO THE SHOP OWNERS WHOSE SHOPS WERE DEMOLISHED BY THE SMC. SHRI GHANSHYAMBHAI D SUTARIYA, THE APPELLANT IN HIS STATEMENT ALSO TOLD THAT HE IS HAVING NO RELATION TO WITH THE LAXMI DARSHAN COMPLEX AND ANY ANSWER IN THIS REGARD CAN BE GIVEN BY THE PRAMUKH OF THE MADHAV DARSHAN CO-OPERATIVE HOUSING SOCIETY, SHRI LAVJIBHAI HARIBHAI PATEL (SUTARIYA). THEREFORE, SUMMON UNDER SECTION 131 OF I. T. ACT, 1961 DATED 29.11.2011 WERE ISSUED TO SHRI LAVJIBHAI HARIBHAI PATEL TO COLLECT THE ADDITIONAL DETAILS. IN RESPONSE TO WHICH, SHRI LAVJIBHAI HARIBHAI PATEL, HAD PERSONALLY APPEARED BEFORE THE AO AND HIS STATEMENT ON OATH WAS RECORDED BY THE AO. IN HIS STATEMENT DATED 03.12.20-012, HE HAS ADMITTED TO BE THE PRAMUKH OF MADHAV DARSHAN HOUSING SOCIETY SINCE YEAR 2000 GHANSHYAM DUNGARBHAI SUTARIYA V. ACIT-8-SURAT /I.T.A. NO.1615 & 1730/AHD/2014/A.Y.09-10 PAGE 49 OF 52 WHICH WAS REGISTERED IN YEAR 1998. IN ANSWER TO QUESTION NO.3, HE STATED THAT IN YEAR 2003 MADHAV DARSHAN CO-OPERATIVE HOUSING SOCIETY HAS PLANNED TO CONSTRUCT LAXMI DARSHAN COMPLEX ON PLOT NO. 1 TO 14 ON WHICH SHOPS AND FLATS WERE CONSTRUCTED. SHRI GHANSHYAMBHAI D SUTARIYA IS HAVING NO CONNECTION WITH THIS SOCIETY. HE IS NEITHER A MEMBER NOR HOLDING ANY SHOPS / FLATS OR MEMBERSHIP OF SOCIETY. HE WAS FURTHER ASKED ABOUT THE PAPERS OF LAXMI DARSHAN FOUND DURING SURVEY PROCEEDINGS AT THE PREMISES OF SHRI GHANSHYAMBHAI D SUTARIYA. IN ANSWER TO THIS, HE REPLIED THAT THESE PAPERS ARE RELATED TO LAXMI DARSHAN COMPLEX, WHICH WAS CONSTRUCTED BY MADHAV DARSHAN CO-OP HOUSING SOCIETY LTD. ONLY. SOME SHOPS WERE DEMOLISHED BY THE SMC AND A DISPUTE AROSE AMONG THE SOCIETY MEMBERS AND OWNERS OF THE SHOPS WHOSE SHOPS WERE DEMOLISHED BY THE SMC. TO SETTLE THIS DISPUTE, THEY CALLED A MEETING (PANCHAYAT) AND SHRI GHANSHYAMBHAI D SUTARIYA WAS PRESENTED THERE AS A PANCH. AFTER THE MEETING, ONE COPY OF THE DECISION TAKEN BY THE PANCHAYAT WAS GIVEN TO HIM. THESE PAGES CONTAIN THE DETAILS OF PAYMENTS TO BE MADE TO THE SHOPS OWNERS WHOSE SHOPS WERE DEMOLISHED BY THE SMC. THE ABOVE CONTENTIONS OF THE APPELLANT IS NOT ACCEPTABLE BECAUSE THE APPELLANT HAS GIVEN CONTRADICTORY STATEMENT DURING THE ASSESSMENT PROCEEDINGS AND DURING THE APPELLATE PROCEEDINGS. DURING THE ASSESSMENT PROCEEDING, THE APPELLANT HAS ADMITTED TO BE THE ORGANIZER OF THE MADHAV DARSHAN CO-OPERATIVE HOUSING SOCIETY LTD. WHEREAS DURING THE APPELLATE PROCEEDINGS AND IN HIS STATEMENT HE HAS STATED THAT HE WAS PRESENT AS PANCH. IN VIEW OF THIS THAT ISSUE MAY BE DECIDE ON MERITS. IN VIEW OF THESE FACTS, THE CIT(A) GHANSHYAM DUNGARBHAI SUTARIYA V. ACIT-8-SURAT /I.T.A. NO.1615 & 1730/AHD/2014/A.Y.09-10 PAGE 50 OF 52 VIEWED THAT THE APPELLANT IS HAVING NO FINANCIAL DEALINGS IN THE SHOPPING CENTRE OF LAXMI DARSHAN COMPLEX. THE OFFICE BEARER OF THE MADHAV DARSHAN CO-OPERATIVE HOUSING SOCIETY , SHRI LAVJIBHAI HARIBHAI PATEL HAS ALSO CONFIRMED IN HIS STATEMENT ON OATH RECORDED BY THE AO DURING INQUIRIES PERTAINING TO REMAND REPORT THAT THE THE APPELLANT HAS NO FINANCIAL DEALING WITH THE AFORESAID SHOPPING COMPLEX. HIS PRESENCE WAS ONLY AS A PANCH IN THE DISPUTE RESOLUTION. THE ASSESSEE HAS BROUGHT NO EVIDENCE OF ANY FINANCIAL DEALINGS OF THE APPELLANT WITH THE MADHAV DARSHAN CO- OPERATIVE HOUSING SOCIETY. THE ADDITION MADE BY THE AO IN THE HANDS OF THE APPELLANT CANNOT BE SUSTAINED IN VIEW OF ABOVE FINDINGS. IN VIEW OF ABOVE FACTS, THE ADDITION OF RS. 97,24,958 MADE BY THE AO WAS DELETED. 60. BEING AGGRIEVED, THE REVENUE HAS FILED THIS APPEAL BEFORE THE TRIBUNAL. THE LD. CIT(DR) VEHEMENTLY RELIED ON THE ORDER OF THE AO AND SUBMITTED THAT THE ASSESSEE HAS GIVEN CONTRADICTORY STATEMENT DURING ASSESSMENT PROCEEDINGS AND APPELLATE PROCEEDINGS. HENCE, THE LD. CIT(A) OUGHT TO HAVE UPHELD THE ACTION OF THE AO. 61. AU CONTRAIRE , THE LEARNED COUNSEL FOR THE ASSESSEE SUPPORTING THE ORDER OF LD.CIT(A) AND SUBMITTED THAT THE APPELLANT HAS NOT ANY KIND OF INTEREST IN THE LAXMI DARSHAN COMPLEX DEVELOPED BY MADHAV DARSHAN CO-OPERATIVE HOUSING SOCIETY. THE APPELLANT HAS ONLY ACTED AS PANCH TO RESOLVE THE DISPUTE AROSE BETWEEN SOME SHOP OWNERS AND SOCIETY MEMBERS. FURTHER, THE PRESIDENT OF MADHAV DARSHAN GHANSHYAM DUNGARBHAI SUTARIYA V. ACIT-8-SURAT /I.T.A. NO.1615 & 1730/AHD/2014/A.Y.09-10 PAGE 51 OF 52 SOCIETY, SHRI LAVJIBHAI HARIBHAI PATEL HAS AFFIRMED THE AFORESAID FACTS BY APPEARING BEFORE THE AO AND GIVING A STATEMENT ON OATH. THE AO DID NOT BRING ANY CONTRARY EVIDENCE TO PROVE THAT THE ASSESSEE HAS ANY FINANCIAL DEALINGS WITH MADHAV DARSHAN CO-OP HOUSING SOCIETY LTD. 62. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE RELEVANT MATERIAL ON RECORD. WE FIND THAT THE AO HAS MADE ENQUIRIES DURING THE COURSE OF REMAND PROCEEDINGS WHEREIN HE HAS EXAMINED SHRI LAVJIBHAI HARIBHAI PATEL, THE PRESIDENT OF MADHAV DARSHAN CO-OP HOUSING SOCIETY LTD. WHO DEVELOPED THE LAXMI DARSHAN COMPLEX. IT HAS BEEN EMERGED THAT THE ASSESSEE HAS ACTED AS PANCH IN RESOLVING A DISPUTE AROSE BETWEEN MEMBERS OF SOCIETY ON REDUCING THE ALIGNMENT OF SHOPS BY THE SMC. SINCE THE CIT(A) AS WELL THE AO HAS ACCEPTED THAT THE ASSESSEE HAS NO FINANCIAL DEALINGS WITH LAXMI DARSHAN COMPLEX. THE COPY OF PAPERS OF THE SOCIETY BEING A COPY OF DECISION TAKEN BY THE MEMBER OF SOCIETY WAS FOUND IN POSSESSION OF THE ASSESSEE AS HE BEING A PANCH HAS RETAINED A COPY OF DECISION TAKEN BY THE PANCHAYAT. HAVING CAREFUL CONSIDERATION OF FACTS, WE ARE OF THE VIEW THAT LD. CIT(A) WAS CORRECT IN DELETING THE ADDITION MADE AS UNEXPLAINED EXPENDITURE OF RS. 97,24,958. ACCORDINGLY, THIS GROUNDS OF APPEAL OF REVENUE IS THEREFORE, DISMISSED. 63. GROUND NO. 5 STATES THAT LD. CIT(A) HAS ERRED IN RESTRICTING THE ADDITION MADE ON ACCOUNT OF UNACCOUNTED INCOME OF RS.34,82,000/- AND RS.1,42,60,000/- AND RS.5,43,49,000/- TO RS.1,34,86,000/- WITHOUT APPRECIATING THE FACTS THAT THE ASSESSEE FAILED TO EXPLAIN THE LOOSE PAPER NOTINGS. GHANSHYAM DUNGARBHAI SUTARIYA V. ACIT-8-SURAT /I.T.A. NO.1615 & 1730/AHD/2014/A.Y.09-10 PAGE 52 OF 52 64. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE RELEVANT MATERIAL ON RECORD. WE FIND THAT THIS GROUND OF APPEAL IS COVERED BY THE GROUND NO.(III) OF THE APPEAL OF THE ASSESSEE AS DISCUSSED ABOVE. WHILE DEALING WITH THE GROUND NO.(III) OF THE ASSESSEE, WE HAVE UPHELD THE FINDINGS GIVEN BY THE LD. CIT(A). ACCORDINGLY, THIS GROUNDS OF APPEAL OF REVENUE ON THE BASIS OF REASONS GIVEN THEREIN, IS ACCORDINGLY, DISMISSED. 65. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS PARTLY ALLOWED AND APPEAL OF THE REVENUE IS DISMISSED. 66. THE ORDER PRONOUNCED IN THE OPEN COURT ON 06.06.2019 SD/- SD/- (RAM LAL NEGI) (O.P.MEENA) JUDICIAL MEMBER ACCOUNTANT MEMBER SURAT: DATED: 6 TH JUNE, 2019/OPM COPY OF ORDER SENT TO- ASSESSEE/AO/PR. CIT/ CIT(A)/ ITAT (DR)/GUARD FILE OF ITAT. BY ORDER / / TRUE COPY / / ASSISTANT REGISTRAR, SURAT