DCIT, Central Circle-4, Hyderabad V. Smt. A. Padma Devi, Hyderabad

ITA 1759/HYD/2011

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 66151 (ITAT-HYDERABAD)
• Duration Of Justice: 9 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-08-2012
• Appeal Filed By: Department
• Order Result: Partly Allowed
• Bench Allotted: A
• Assessment Year: 2007-2008
• Appeal Filed On: 12-10-2011
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: V V RAMANA RAO
• Keywords: Search and seizure

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH B, HYDERABAD BEFORE SMT. ASHA VIJAYARAGHAVAN, JUDICIAL MEMBER AND SHRI D.KARUNAKARA RAO, ACCOUNTANT MEMBER ITA NO.1759/HYD/2011 : ASSESSMENT YEAR 2007 -08 DY. COMMISSIONER OF INCOME - TAX CENTRAL CIRCLE 4, HYDERABAD (APPELLANT) V/S SMT. A.PADMA DEVI, HYDERABAD. (PAN - AFVPD 0587 P ) (RESPONDENT) ITA NO.1669/HYD/2011 : ASSESSMENT YEAR 2007 -08 SMT. A.PADMA DEVI, HYDERABAD. V/S. DY. COMMISSIO NER OF INCOME- TAX CENTRAL CIRCLE 4, HYDERABAD (PAN - AFVPD 0587 P ) (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI A.SRINIVAS DEPARTMENT BY : SHRI V.V.RAMANA RAO DATE OF HEARING 30.7.2012 DATE OF PRONOUNCEMENT 10.8.2012 O R D E R PER D.KARUNAKARA RAO, ACCOUNTANT MEMBER: THESE ARE CROSS APPEALS FOR THE ASSESSMENT YEAR 2 007-08. THEY ARE DIRECTED AGAINST THE ORDER OF THE COMMISSI ONER OF INCOME- TAX(APPEALS) VII, HYDERABAD DATED 2.8.2011. SINCE COMMON ISSUES ARE INVOLVED, THESE APPEALS ARE BEING DISPOSED OFF WITH THIS COMMON ORDER FOR THE SAKE OF CONVENIENCE. 2. EFFECTIVE GROUND OF THE REVENUE IN ITS APPEAL, ITA NO.1759/HYD/2011 READS AS FOLLOWS- ITA NO.1759 & 1669/HYD/2011 SMT. A.PADMA DEVI, HYDERABAD 2 1. . 2. THE LD. CIT(A) HAS ERRED IN CONFIRMING ONLY 50% OF THE INVESTMENT IN ASSESSEES HAND AFTER CLEARLY ESTABLI SHING THAT THE ENTIRE INVESTMENT IS UNACCOUNTED AND THE ONUS L IED ON THE ASSESSEE (APPELLANT) TO PROVE THAT 50% OF INVES TMENT HAS BEEN MADE BY ONE SHRI MAHAVEER CHAND JAIN. SINC E, THE IDENTITY OF SHRI MHAVEER CHAND JAIN IS NOT PROVED A ND HE FAILED TO ATTEND IN RESPONSE TO SUMMONS, IT WAS RIG HTLY CONCLUDED BY THE AO THAT SHRI MAHAVEER CHAND JAIN I S ONLY A BENAMI IN THE SAID TRANSACTION. 3. . EFFECTIVE GROUND OF THE ASSESSEE IN ITS APPEAL, ITA NO.1669/HYD/2011 READS AS FOLLOWS- 1. . 2. THE COMMISSIONER OF INCOME-TAX(APPEALS) ERRED IN SUSTAINING AN ADDITION OF RS.62,50,000/- FOR UNTENA BLE REASONS WHEN IT WAS SPECIFICALLY DENIED RIGHT FROM THE BEGINNING BY THE APPELLANT THE ISSUE OF ALLEGED NOT ICE AND THE ASSESSING OFFICER HAS FAILED TO BRING ON RECORD S ANY EVIDENCE TO SHOW THE NOTICE WAS ISSUED TO THE APPEL LANT. IN FACT APPELLANT FILED AN AFFIDAVIT BEFORE THE ASSESS ING OFFICER DURING THE COURSE OF ASSESSMENT PROCEEDINGS THAT D ENYING ISSUE OF NOTICE AND ALSO PAYMENT OF EXTRA CONTRIBUT ION. 3. . 3. FACTS IN BRIEF LEADING TO THE FILING OF THE PRE SENT APPEALS ARE THAT THERE WAS SEARCH AND SEIZURE OPERATION CONDUCT ED UNDER S.132 OF THE ACT, 1961 ON THE KEDIA GROUP CASES ON 1.2.2008. BASED ON CERTAIN MATERIAL PERTAINING TO THE ASSESSEE AVAILABLE IN TH E SEIZED MATERIAL IN RELATION TO THE ASSESSEE, NOTICE UNDER S.153C OF TH E ACT WAS ISSUED FOR THE ASSESSMENT YEAR 2007-08 ON 13.2.2009. ASSESSE E FILED RETURN OF INCOME ON 20.4.2009 IN RESPONSE TO NOTICE UNDER S.1 53C DECLARING THE TOTAL INCOME OF RS.3,30,790. ONE OF THE MATERIAL F OUND AND SEIZED DURING THE COURSE OF SEARCH WAS A LEGAL NOTICE DATED 25.11 .2007 ISSUED BY ONE SHRI VENKATESH DESHPANDE, AN ADVOCATE OF KEDIA FAMI LY UNDER THE INSTRUCTIONS OF HIS CLIENTS (I) SRI MAHAVEER CHAND JAIN, B-12, ANKUR, ITA NO.1759 & 1669/HYD/2011 SMT. A.PADMA DEVI, HYDERABAD 3 SHASTRI NAGAR COLONY, JODHPUR, AND (II) SMT.PADMA D VI W/O. SRI PRAKASH KUMAR JAIN, RESIDENT OF RS.201, SUKH SAGAR APARTMEN TS, 3-5-805, HYDERGUDA, HYDERABAD, ACCORDING TO WHICH THE ABOVE TWO INDIVIDUALS, VIZ. THE ASSESSEE AND ANOTHER, HAVE ENTERED INTO AN AGREEMENT OF SALE DATED 8.5.2006 FOR PURCHASE OF AGRICULTURAL LANDS A DMEASURING 10.18 GUNTAS, I.E. IN SURVEY NO.155/2 (EXTENT ACRES 1.05 GUNTAS) SITUATED AT TONDAPALLY VILLAGE AND IN SY. NO.194 (ACRE 0.16 GUN TAS), SY.195 (P) (EXTENT ACRES 6-17 GUNTAS) AND IN SY.NO.196 AND 197 (P) (EXTENT 2.20 GUNTAS) OF HAMMEEDULLAH NAGAR VILLAGE, RR DIST., AP FOR A TOTAL SALE CONSIDERATION OF RS.2,92,60,000 @ RS.28,00,000 PER ACRE, AND THE ASSESSEE AND SHRI MAHAVEERCHAND JAIN HAVE MADE PAYM ENTS AGGREGATING TO RS.1,25,00,000 IN PURSUANCE OF THE SAID AGREEMEN T. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, ASSESSEE WAS ASKED TO S HOW THE SOURCE OF THE INVESTMENT FOR THE AMOUNT OF RS.1,25,00,000. I N RESPONSE, ASSESSEE STATED THAT SHE HAS NOT ISSUED ANY NOTICE THROUGH S HRI VENKATESH DESHPANDE AND SHE HAS NOT PURCHASED ANY LANDS FROM SHARADA DEVI AND OTHERS, AND EVEN NOT ENTERED INTO ANY AGREEMENT IN THAT REGARD. FINDING THE EXPLANATION OF THE ASSESSEE NOT ACCEPTABLE, THE ASSESSING OFFICER MADE AN ADDITION OF RS.1,25,00,000 ON THIS COUNT, E NTIRELY ON THE ASSESSEE, AND COMPLETED THE ASSESSMENT ON A TOTAL INCOME OF RS.1,28,30,790, VIDE ORDER OF ASSESSMENT DATED 31.1 2.2009 PASSED UNDER S.143(3) READ WITH S.153C OF THE ACT. IN THE PROCESS, ASSESSING OFFICER IGNORED THE EXISTENCE OF THE NAME OF SHRI M AHAVEER CHAND JAIN IN THE SAID LEGAL NOTICE. DURING THE ASSESSMENT PRO CEEDINGS, THE ASSESSING OFFICER INVOKED THE PROVISIONS OF S.131 OF THE ACT ON THE ASSESSEE AND RECORDED A STATEMENT ON 24.2.2011. FURTHER, THE AS SESSING OFFICER IS ALSO IN POSSESSION OF THE LETTERS FROM THE ASSESSEE DATE D 10.11.2009 AND AN AFFIDAVIT DATED 22.12.2009 AND ANOTHER LETTER DATED 24.12.2009 FROM THE SAID ADVOCATE, SHRI VENKATESH DESHPANDE, WHO IS THE AUTHOR OF THE IMPUGNED LEGAL NOTICE. BOTH OF THEM PLEADED IGNORA NCE OF THE GENUINENESS OF THE IMPUGNED TRANSACTION. ITA NO.1759 & 1669/HYD/2011 SMT. A.PADMA DEVI, HYDERABAD 4 5. ON APPEAL, THE CIT(A) OBSERVING THAT ONLY 50% O F THE INVESTMENT IN QUESTION COULD BE TREATED AS THAT OF THE ASSESSEE, CONFIRMED ADDITION ONLY TO THE EXTENT OF RS.62,50,0 00, AND GRANTEED RELIF TO THAT EXTENT TO THE ASSESSEE. 6. AGGRIEVED BY THE ORDER OF THE CIT(A), ASSESSEE PREFERRED APPEAL, ITA NO.1669/HYD/2011, CONTESTING THE SUSTAI NED PORTION OF THE ADDITION MADE BY THE ASSESSING OFFICER, WHEREAS THE REVENUE PREFERRED THE APPEAL, ITA NO.1759/HYD/2011, CONTESTING THE RE LIEF GRANTED BY THE CIT(A). 7. LEARNED COUNSEL FOR THE ASSESSEE, REITERATING T HE CONTENTIONS URGED BEFORE THE LOWER AUTHORITIES, SUBMITTED THAT WHEN THE ASSESSEE HAS NOTHING TO DO WITH THE LEGAL NOTICE ALLEGED TO HAVE BEEN SEIZED AT THE TIME OF SEARCH, THERE IS NO SCOPE FOR MAKING ANY ADDITION WHATSOEVER IN THE HANDS OF THE ASSESSEE, BASED ON SUCH NOTICE, WH ICH IS NOT CORROBORATED BY ANY EVIDENCE. IN THIS BEHALF, HE T OOK US THROUGH THE AFFIDAVIT FILED BEFORE THE ASSESSEE, AND THE LETTER WRITTEN BY THE ADVOCATE SHRI VENKATESH DESHPANDE DATED 24.12.2009 (PAGE 7 O F THE PAPER-BOOK) WRITTEN TO THE DEPARTMENT. VIDE THESE LETTERS AND AFFIDAVITS/STATEMENTS, THE ASSESSEE AND THE ADVOCATE (SHRI VANKESTESH DESH PANDE) DENIED HAVING KNOWLEDGE OF PEOPLE WHO VISITED HIM, HAVING PAID THE IMPUGNED SUMS. THE ADVOCATE GOES ON RECORD IN PLEADING IGNOR ANCE OF THE PEOPLE WHO VISITED HIM AND WANTED THE IMPUGNED LEGAL NOTIC E ISSUED. TAKING US FURTHER THROUGH THE STATEMENT OF THE ASSESSEE, RECO RDED BY THE ASSESSING OFFICER, PLACED AT PAGES 8 TO 10 OF THE PAPER-BOOK, HE SUBMITTED THAT THE ASSESSEE AFFIRMED HAVING NOT EITHER SEEN THE ORIGIN AL RECEIPTS IN RESPECT OF THE PAYMENTS ALLEGEDLY MADE BY THE ASSESSEE, OR IN A POSITION TO IDENTIFY THE SIGNATURES OF THE ASSESSEE AND SHRI MA HAVEER CHAND JAIN AND HAVING NOT MET THEM. IN SUCH CIRCUMSTANCES, THE CIT(A) ERRED IN ITA NO.1759 & 1669/HYD/2011 SMT. A.PADMA DEVI, HYDERABAD 5 CONFIRMING THE ADDITION TO THE TUNE OF RS.62.50 LAK HS I.E. 50% OF THE AMOUNT OF RS.1.25 CRORES MENTIONED IN THE LEGAL NOT ICE. 8. THE LEARNED DEPARTMENTAL REPRESENTATIVE, ON THE OTHER HAND, STRONGLY SUPPORTING THE ORDER OF ASSESSMENT SUBMIT TED THAT IN THE ABSENCE OF ANY EVIDENCE AS TO THE IDENTITY OF SHRI MAHAVEER CHAND JAIN, AS HE FAILED TO ATTEND IN RESPONSE TO THE SUMMONS I SSUED, AND AS THE ASSESSEE HAS FAILED TO DISCHARGE THE ONUS THAT LIED ON HER TO PROVE IN THAT BEHALF, THE ASSESSING OFFICER WAS JUSTIFIED IN MAKI NG THE ENTIRE ADDITION OF RS.1,25,00,000 IN THE HANDS OF THE ASSESSEE, AND TH E CIT(A) WAS NOT JUSTIFIED IN RESTRICTING THE ADDITION SO MADE ONLY TO RS.62,50,00,000. FURTHER, THE LEARNED DEPARTMENTAL REPRESENTATIVE AR GUED STATING THAT THE CIT(A) MERELY RELIED ON THE SUBMISSIONS OF THE ASSESSEE, WHILE GRANTING RELIEF OF RS.62.50 LAKHS, MERELY BASED ON THE EXISTENCE OF THE NAME OF SHRI MAHAVEER CHAND JAIN, WHO FAILED TO COM PLY WITH STATUTORY NOTICE. THE CIT(A) ERRED IN ACCEPTING THE SELF-SERV ING DOCUMENTS FILED BEFORE HIM. 9. WE HEARD BOTH SIDES AND PERUSED THE IMPUGNED O RDERS OF REVENUE AUTHORITIES AND THE INFORMATION MADE AVAILA BLE BEFORE US. THE CASE OF THE ASSESSEE IS THAT THE INCRIMINATING DOC UMENT SEIZED BY THE DEPARTMENT INVOLVING THE NAME OF THE ASSESSEE IS TH E LEGAL NOTICE DATED 25.11.2006 AND THE SAID DOCUMENT ALONE IS NOT SUFF ICIENT FOR MAKING THE ADDITION IN THE ABSENCE OF ANY CORROBORATIVE EVIDEN CE. THE ASSESSEE RELIES ON THE LETTER OF THE ASSESSEE DATED 19.11.2009 AND THE AFFIDAVIT DATED 22.12.2009 FILED BY THE ASSESSEE. ASSESSEE ALSO REL IES ON THE LETTER OF THE ADVOCATE ADDRESSED TO THE ASSESSING OFFICER DATED 2 4.12.2011. IN THE SAID LETTER AND THE AFFIDAVIT OF THE ASSESSEE, WHIL E THE ASSESSEE DENIED ANY CONNECTION WITH THE IMPUGNED TRANSACTION, THE A DVOCATE THROUGH HIS LETTER DATED 24.12.20090 AFFIRMS THE ISSUE OF LEGAL NOTICE, BUT PLEADS IGNORANCE ABOUT THE PEOPLE, WHO CONTACTED HIM WITH THE RELEVANT ITA NO.1759 & 1669/HYD/2011 SMT. A.PADMA DEVI, HYDERABAD 6 DOCUMENTS FOR THE ISSUANCE OF THE LEGAL NOTICE IN Q UESTION. FURTHER, HE CATEGORICALLY DENIES HAVING MET THE ASSESSEE. ON T HE OTHER HAND, THE CASE OF THE REVENUE IS THAT THE LEGAL NOTICE IS NOT A DUMB DOCUMENT, AS IT CONTAINS DETAILED ADDRESSES OF THE PEOPLE INVOLVED, OWNERS OF THE LAND AND THE DETAILS OF THE LAND, APART FROM THE SPECIFI C DATES OF PAYMENT OF CONSIDERATION, BESIDES GIVING DETAILS OF SURVEY NUM BERS OF THE LAND INVOLVED. IT ALSO REFERS TO THE AGREEMENT OF SALE DATED 8.5.2006 AND THE ISSUE OF NOTICE IN HINDI MILAP CAUTIONING GENERAL PUBLIC NOT TO TRANSACT IN THE LAND IN QUESTION. IT ALSO REFERS TO PAYMENT OF RS.50 LAKHS ON 8.5.2006, FURTHER SUM OF RS.50,00,000 ON 15.5.2006 AND STILL FURTHER SUM OF RS.25,00,000 ON 26.6.2006, AGGREGATING IN ALL TO RS.1,25,00,000. IT CONTAINS THE LAND DETAILS LOCATED IN SURVEY NOS. 1 55/2 SITUATED AT TONDAPALLY VILLAGE, SURVEY NO.194, 196(P) AND 197(P ) OF HAMMEDULLAH NAGAR VILLAGE, R.R. DISTRICT, ANDHRA PRADESH. THE LEARNED DEPARTMENTAL REPRESENTATIVE PLEADS THAT SUCH A DOCUMENT, SPECIFY ING THE DETAILS OF THE LAND, WHICH IS THE SUBJECT MATTER OF TRANSACTION, G ROSS CONSIDERATION OF RS.2,92,60,000, DETAILS OF THE PERSONS/OWNERS WHO ARE READY TO SELL AND WHO RECEIVED THE APPARENT CONSIDERATION OF RS.1.25 CRORES FROM ASSESSEE AND ANOTHER, CANNOT BE REJECTED OUTRIGHT, BASED ON SELF-SERVING DOCUMENTS AND PLEADINGS OF THE ASSESSEE, THROUGH HE R LETTER DATED 19.11.2009 AND AFFIDAVIT DATED 22.12.2009 BESIDES A DVOCATES LETTER DATED 24.12.2009 AND OTHERS. 10. ` IT IS A RELEVANT FACT TO NOTE THAT SHRI VENKA TESH DESHPANDE, ADVOCATE, CONFIRMS THE GENUINENESS OF THE SAID LEG AL NOTICE WHEN HE STATED THAT THE SAID NOTICE DATED 25.11.2006 WAS IS SUED BY HIM, BASED ON THE DOCUMENTS BROUGHT TO HIM BY SOME PERSONS OF THE ASSESSEE OR SHRI MAHAVEER CHAND JAIN. FINALLY, WITHOUT PREJUDICE, T HE LEARNED DEPARTMENTAL REPRESENTATIVE ONLY ASKED FOR REVIEWIN G THE RELIEF GRANTED BY THE CIT(A). WITHOUT PREJUDICE, THE LEARNED DEPAR TMENTAL REPRESENTATIVE FURTHER MENTIONED THAT AN OPPORTUNIT Y MAY BE GRANTED TO ITA NO.1759 & 1669/HYD/2011 SMT. A.PADMA DEVI, HYDERABAD 7 THE REVENUE, BY RESTORING THE MATTER WITH SUITABLE DIRECTIONS TO THE ASSESSING OFFICER TO VERIFY AND GO TO THE ROOT OF T HE MATTER, AS HE HAS NOT EXHAUSTIVELY COMPLETED THE INVESTIGATIONS DUE TO PA UCITY OF TIME. 11. WE HAVE CAREFULLY CONSIDERED THE RIVAL STANDS AND PERUSED THE CRUCIAL DOCUMENTS RELIED UPON BY THE PARTIES TO THE DISPUTE. SO FAR AS THE REVENUE IS CONCERNED, IMPUGNED LEGAL NOTICE DATED 2 5.11.2006 IS THE CRUCIAL DOCUMENT ON WHICH IT RELIES . PARTLY IT AL SO RELIES ON THE LETTER OF THE ADVOCATE DATED 24.12.2009, TO THE EXTENT THAT H E CONFIRMS THE FACT OF ISSUE OF NOTICE BASED ON THE RELEVANT DOCUMENTS BRO UGHT TO HIM BY SOME UNIDENTIFIED PERSONS. A PERUSAL OF THESE DOCUMENTS REVEAL THAT THE LEGAL NOTICE IS EXHAUSTIVE SO FAR AS THE DETAILS AND ADDR ESSES OF THE IMPUGNED IMMOVABLE PROPERTY, VIZ. AGRICULTURAL LAND, AS MENT IONED IN PARA 1 OF THE SAID NOTICE. PARAS 2 TO 4 REFLECT THE SCHEDULE OF PAYMENTS MADE BY THE ASSESSEES AND ALSO RECORDS THE EXECUTION OF AGREEME NT OF SALE DATED 8.5.2006, WHICH OF COURSE IS NOT AVAILABLE TO THE R EVENUE AUTHORITIES. PARA 8 REFERS TO THE FACT OF ISSUING PUBLIC NOTICE IN HINDI MILAP CAUTIONING THE GENERAL PUBLIC. IN OUR OPINION, THE LEGAL NOTI CE CANNOT BE CONSTRUED AS A DUMB DOCUMENT, AS IT IS A SPEAKING ONE GIVING IN DEPTH PARTICULARS OF PEOPLE, LAND AND TRANSACTION INVOLVED. THIS VIEW I S FORTIFIED BY THE CORROBORATIVE EVIDENCE IN THE FORM OF LETTER OF ADV OCATE DATED 24.12.2009, WHEREIN THE SAID ADVOCATE STATED AS FOL LOWS- .I WISH TO STATE THAT THE LEGAL NOTICE DT.25.11 .2006 IS ISSUED BY ME. I FURTHER WISH TO STATE THAT SOME PE RSONS CAME TO MY OFFICE WITH THE RELEVANT RECORDS AND REQUESTED M E TO ISSUE NOTICE TO THE ADDRESSES MENTIONED THEREIN AND UPON VERIFYING THE COPIES OF THE DOCUM ENTS FURNISHED TO ME AT THAT POINT OF TIME, I HAVE ISSUED A LEGAL NOTICE DATED 25.11.2006. IT IS PERTINENT TO STATE THAT I HAVE NOT MET EITHER MAHAVIR CHAND JAIN OR SMT. PADMA DEVI AND I CANNOT RECOLLECT THE NAME OF THE PERSONS WHO APPROACHED ME FOR CAUSING THE SAID NOTICE SINCE THE MATTER IS OF THE YEAR 2006. THEREFORE, EITHER THE CONTENTS OF THE LEGAL NOTICE OR ITS GENUINENESS CANNOT BE DOUBTED CONSIDERING THE ABOVE EXTRACT FRO M THE LEGAL NOTICE ITA NO.1759 & 1669/HYD/2011 SMT. A.PADMA DEVI, HYDERABAD 8 GIVEN BY THE ADVOCATE. EVEN FROM THE FACT THAT THE SAID NOTICE HAS BEEN SEIZED BY THE DEPARTMENT FROM THE PREMISES OF THE A DDRESSEES DURING THE SEARCH ACTION UNDER S.132 OF THE ACT, REVEALS ITS G ENUINENESS. EVEN THOUGH THE ASSESSEE RELIES ON HER LETTER DATED 19.1 1.2009, WHICH IS SUPPORTED BY THE AFFIDAVIT DATED 22.12.2009, PRIMA FACIE THESE APPEAR TO BE SELF-SERVING DOCUMENTS OF THE ASSESSEE. IT IS A LSO NOTICED THAT THE ASSESSING OFFICER HAS HURRIEDLY COMPLETED THE ASSES SMENT ON 31.12.2009 AND IT APPEARS THAT HE FAILED IN INITIATING THE ASS ESSMENT PROCEEDINGS IN ADVANCE. ASSESSEES LETTER, AFFIDAVIT, ADVOCATES L ETTER ARE DATED NOVEMBER AND DECEMBER, 2009. IN OUR OPINION, THE A SSESSING OFFICER FAILED TO MAKE PROPER ASSESSMENT IN THIS CASE, AS H E FAILED TO PLAY A ROLE OF AN INVESTIGATOR, WHICH IS THE JOB OF ANY ASSESSI NG OFFICER. FURTHER, THE ASSESSING OFFICER SHOULD HAVE GATHERED THE BASIC FA CTS THAT ARE REQUIRED FOR PROPER DETERMINATION OF THE ISSUE. ASSESSING O FFICER COULD HAVE GIVEN FINDING ON THE DETAILS APPEARING IN THE LEGAL NOTIC E ABOUT THE VERACITY OF SURVEY NOS./LAND DETAILS, DETAILS OF THE OWNERS OF THE LAND AND WHETHER THE NAMES OF THE PERSONS GIVEN ON THE LEGAL NOTICE, VIZ. SMT. SHARADA DEVI KEDIA, SMT. KAVITA KEDIA AND SHRI DILIP KEDIA ALL RESIDENTS OF 19-2- 2876, MIRALAM TANK, BAHADURPURA, HYDERABAD ARE GENU INE. FURTHER, THE ASSESSING OFFICER SHOULD HAVE GIVEN FINDING ON THE GENUINENESS OF THE AGREEMENT OF SALE DATED 18.5.2006. FURTHER, THE ASS ESSING OFFICER SHOULD HAVE EXAMINED, IF THE ADVERTISEMENT IN HINDI MILAP ALERTING THE GENERAL PUBLIC WHILE TRANSACTING IN RESPECT OF THE IMPUGNED AGRICULTURAL LAND, IS A GENUINE ONE OR NOT. IN OUR OPINION, THE ASSESSING OFFICER SHOULD HAVE ALSO EXAMINED SHRI SHARADA KEDIA AND TWO OTHERS TO WHOM LEGAL NOTICE HAS BEEN SENT BY SHRI VENKATESH DESHPANDE TO ARRIVE AT THE CORRECT CONCLUSION AS TO THE CORRECTNESS OF THE AVERMENTS M ADE IN THE LEGAL NOTICE AND THE GENUINENESS OF THE TRANSACTIONS AS W ELL AS PAYMENTS CLAIMED TO HAVE BEEN MADE BY THE ASSESSEE AND ANOTH ER, RECORDED THEREIN. UNFORTUNATELY, WE FIND THAT THE ASSESSING OFFICER HAS NOT CONDUCTED INDEPENDENT ENQUIRIES ON THESE ASPECTS, P ERHAPS FOR WANT AOF ITA NO.1759 & 1669/HYD/2011 SMT. A.PADMA DEVI, HYDERABAD 9 TIME. UNLESS THESE ASPECTS HAVE BEEN EXAMINED AND C ORROBORATIVE EVIDENCE HAS BEEN BROUGHT ON RECORD, BASED MERELY O N THE NAMING OF THE ASSESSEE IN THE SAID LEGAL NOTICE FOUND AT THE TIME OF SEARCH ACTION UNDER S.132, IN THE PREMISES OF THE KEDIA GROUP, ADDITION MADE BY THE ASSESSING OFFICER CANNOT BE SUSTAINED. CONSEQUENTL Y, THIS APPROACH OF THE ASSESSING OFFICER CANNOT BE APPROVED STRAIGHT AWAY. 12. THUS, THE DEPARTMENT IS UNDER AN OBLIGATION T O GATHER SOME MORE EVIDENCE TO CORROBORATE WITH THE CONTENTS OF T HE LEGAL NOTICE IN QUESTION, SO AS TO ESTABLISH THE GENUINENESS OF THE DOCUMENTS AND THE NEXUS BETWEEN THE ASSESSEE AND THE SAID LEGAL NOTIC E. EVEN THOUGH THE SAID LEGAL NOTICE, THOUGH GIVES RISE TO INFERENCES AS TO THE RIGHTS OF THE ASSESSEE AND ANOTHER IN RESPECT OF AN ACTIONABLE CL AIM, THAT ITSELF IS NOT ENOUGH TO ARRIVE AT THE CONCLUSIONS AS TO THE INVES TMENT MADE BY THE ASSESSEE IN RELATION TO THE AGREEMENT IN QUESTION, MORE PARTICULARLY, WHEN THE ASSESSEE IS DENYING THE SAME. THE DEPARTME NT, BASED ON SUCH LEGAL NOTICE, SHOULD HAVE CONDUCTED INDEPENDENT ENQ UIRIES IN RELATION TO HE PROPERTIES IN QUESTION AND WITH THE OWNERS TO WH OM THE NOTICES IN QUESTION WERE SENT. IT IS STRANGE THAT THE ADVOCAT E CLAIMS THAT SOME PERSONS APPROACHED HIM WITH A REQUEST FOR THE ISSUA NCE OF THE LEGAL NOTICE IN QUESTION, AND HE ACTED ACCORDINGLY AS PER THEIR REQUEST, WITHOUT VERIFYING THEIR CREDENTIALS OR EVEN BONA FIDES OF THE PERSONS WHOM THEY CLAIM TO REPRESENT. THE ADVOCATE MUST AFFIRM THE DO CUMENTS SEEN BY HIM BEFORE THE ISSUE OF THE IMPUGNED LEGAL NOTICE. 13. CONSIDERING TOTALITY OF FACTS AND CIRCUMSTANCE S OF THE CASE, WE SET ASIDE THE IMPUGNED ORDERS OF THE LOWER AUTHO RITIES AND SET ASIDE THE MATTER TO THE FILE OF THE ASSESSING OFFICER, WI TH A DIRECTION TO REDETERMINE THE ISSUE, IN THE LIGHT OF THE ABOVE DI SCUSSION, AFTER MAKING INDEPENDENT ENQUIRIES AND GATHERING CORROBORATIVE E VIDENCE IN RELATION TO THE TRANSACTIONS IN THE PROPERTIES IN RESPECT OF WH ICH THE LEGAL NOTICE IN ITA NO.1759 & 1669/HYD/2011 SMT. A.PADMA DEVI, HYDERABAD 10 QUESTION WAS ISSUED, AND ALSO AS TO THE CORRECTNESS OF THE CLAIM OF THE ADVOCATE IN QUESTION ABOUT THE FACTS AND CIRCUMSTAN CES LEADING TO THE ISSUANCE OF SUCH NOTICE ON BEHALF OF THE ASSESSEE A ND SHRI MAHAVEER CHAND JAIN, AND THE NEXUS OF THE ASSESSEE WITH THE SAID NOTICE. IT IS NOT KNOWN IF THE INCOME-TAX INSPECTOR IS ALREADY PUT IN TO ACTION TO ESTABLISH THE IDENTITY OF SHRI JAIN. THE ASSESSING OFFICER SH ALL REDETERMINE THE ISSUE THEREAFTER, IN ACCORDANCE WITH LAW BY PASSING A SPE AKING ORDER AND AFTER GIVING REASONABLE OPPORTUNITY OF HEARING TO THE ASS ESSEE. 14. IN THE RESULT, BOTH THE APPEALS OF THE ASSESSEE AS WELL AS THE REVENUE ARE ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE COURT ON 10.08.2012 SD/- SD/- ( ASHA VIJAYARAGHAVAN) (D.KARUNAKARA RAO) JUDICIAL MEMBER. ACCOUNTANT MEMBER. DT/- 10TH AUGUST, 2012 COPY FORWARDED TO: 1. SMT. A.PADMA DEVI, C/O. M/S. R.B.KABRA & CO., CHART ERED ACCOUNTANTS 1-917 TILAK ROAD, HYDERABAD 500 001 2. 3. DY. COMMISSIONER OF INCOME - TAX CENTRAL CIRCLE 4, HYDERABAD COMMISSIONER OF INCOME-TAX(APPEALS) VII, HYDERABAD 4. COMMISSIONER OF INCOME-TAX CENTRAL, HYDERABAD 5. DEPARTMENTAL REPRESENTATIVE ITAT, HYDERABAD B.V.S.