Shri Lalitkumar M.Patel, Baroda V. The Income tax Officer, Ward-4(1), Baroda

ITA 2039/AHD/2010

• Counselvise Citation: [2017] 130 COUNSELVISE.COM (IT) 9222 (ITAT-AHMEDABAD)
• Duration Of Justice: 6 year(s) 8 month(s) 6 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-02-2017
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: SMC
• Next Hearing Date: 12-01-2017
• Assessment Year: 1999-2000
• Appeal Filed On: 10-06-2010
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Keywords: Principle of natural justice; Accommodation entries
• Section: 32; 147; 131; 68; 246; 69; 145; 27; 148; 54; 37; 6; 56; 263; 63; 132; 12; 28; 144; 10; 90; 154; 2; 11; 15; 271(1)(b); 139; 143(3); 92

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH, AHMEDABAD BEFORE SHRI R.P. TOLANI, JUDICIAL MEMBER ./ ITA NOS. 2038 TO 2040/AHD/2010 / ASSESSMENT YEAR : 1998-99 TO 2000-01 SHRI LALIT M. PATEL, 4-ATMAJYOTI NAGAR SOCIETY, ELLORA PARK, BARODA PAN : AEXPP 4794 Q VS THE INCOME-TAX OFFICER, WARD-4(1), BARODA / (APPELLANT) / (RESPONDENT) ASSESSEE BY : A.N. SHAH, AR REVENUE BY : ASHISH POPHARE, DR DATE OF HEARING : 1 2/01/2017 DATE OF PRONOUNCEMENT IN COURT : 17/02/20 17 / O R D E R THESE THREE APPEALS BY THE ASSESSEE, DIRECTED AGAIN ST THE RESPECTIVE ORDERS OF LD. CIT(A)-III, BARODA OF EVEN DATED 09.0 1.2010 FOR ASSESSMENT YEARS 1998-99 TO 2000-01. SINCE COMMON ISSUES ARE INVOLVED IN ALL THESE APPEALS, THEY WERE HEARD TOGETHER AND ARE BEING DIS POSED OF BY THIS COMMON ORDER FOR THE SAKE OF CONVENIENCE. 2. THE COMMON GROUND RAISED IN ALL THESE APPEALS I S TO THE EFFECT THAT THE LD. CIT(A)-III, BARODA HAS ERRED IN LAW AND ON FACT S OF THE CASES IN CONFIRMING THE ADDITION OF RS.1,00,000/- IN AY 1997 -98, RS.1,72,500/- IN AY 1998-99 AND RS.6,00,000/- IN AY 2000-01 IN RESPECT OF PAYMENTS RECEIVED FROM M/S. A.P. BUILDERS AS CONSIDERATION FOR PROVID ING ACCOMMODATION ENTRIES. 3. THE BRIEF FACTS ARE ON THE BASIS OF INFORMATIO N RECEIVED FROM PUNE IT OFFICE CONSEQUENT TO SEARCH IN THE CASES OF M/S. A.P. BUILDERS GROUP OF PUNE ON 08.12.1999, THE ASSESSMENTS IN QUESTIONS WE RE FRAMED U/S 143(3) R.W.S. 147 OF THE INCOME-TAX ACT, 1961. THE ASSESS EE ALONG WITH ONE M/S. LUNAWAT BHOR CONSTRUCTION, PUNE ISSUED ACCOMMODATIO N ENTRIES WHICH SMC-ITA NOS. 2038 TO 2040/AHD/2010 SHRI LALIT M. PATEL VS. ITO AYS : 1998-99 TO 2000-01 2 WERE ULTIMATELY SQUARED UP AND M/S. A.P. BUILDERS C LAIMED THAT THE ASSESSEE WAS GIVEN AMOUNTS OF RS.1,00,000/- IN AY 1 997-98, RS.1,72,500/- IN AY 1998-99 AND RS.6,00,000/- IN AY 2000-01 AS CONSI DERATION FOR THE THE ENTRY ACCOMMODATION ARRANGEMENTS. LD. AFTER ACCORD ING OPPORTUNITY OF BEING HRARD MADE THE ABOVE ADDITIONS IN ASSESSEES HANDS. IN FIRST APPEALS LD. CIT(A) CONFIRMED THE ADDITION BY FOLLOWING OBSE RVATIONS (FOR CONVENIENCE ONLY AY 2000-01 IS REPRODUCED):- (AY 2000-01) 3.3 COMING TO THE SECOND GROUND, THE APPELLANT HAS STATED THAT DOCUMENTS FOUND AT THE PREMISES OF THIRD PARTY CANNOT BE USED AGAINST THE APPELLANT. IN THIS REGARD, THE APPELLANT HAS RELIED ON ITAT AHMED ABAD DECISION IN THE CASE OF PRATHNA CONSTRUCTION P LTD. (070 TTJ 0122). THE RELIANCE PLACED BY THE APPELLANT ON THE ABOVE REFERRED CASE LAW IS TOTALLY MISPLACED. IN THAT CASE RELIEF WAS GRANTED BECAUSE ADDITION WAS MADE ON THE BASIS OF DOCUMENTS FOUND AT THE PREMISES OF THE THIRD PARTY, THOUGH OT HER EVIDENCES POINTED TO THE CONTRARY. IN THIS CASE, NOT ONLY THE CASH WAS F OUND BUT ALSO A STATEMENT ON OATH OF THE PARTY WAS RECORDED. BUT EVEN MORE IM PORTANTLY, THERE IS NO DENYING THE FACT THAT THE APPELLANT HAD ISSUED CHEQ UES AND DEMAND DRAFTS OF VARIOUS AMOUNTS TO THE PUNE BASED PARTY. THUS, IN T HE CASE OF APPELLANT, THERE ARE EVIDENCES ESTABLISHING THE TRANSACTIONS BETWEEN THE TWO. IN THE CASE OF THE APPELLANT, THE EVIDENCES FOUND HAS TO B E EXAMINED IN THE LIGHT OF PRINCIPLES OF HUMAN PROBABILITY. IT IS UNDISPUTE D THAT THE UNRECORDED CASH WAS FOUND FROM THE PREMISES OF M/S A.P.BUILDERS O F PUNE WHOSE PREMISES WAS SEARCHED. IT IS IMPORTANT TO NOTE THAT THE PUNE PARTY DID NOT DISOWN THE CASH BUT ONLY EXPLAINED HOW THE CASH WAS LYING I N THE PREMISES. THERE IS NO REASON FOR THE PUNE PARTY TO OWN UP UNRECORDED CASH OF RS.19,50,000/- AND ATTRIBUTE ONLY A PAYMENT OF RS.6,00,000/- TO THE APPELLANT. IT IS ALSO TO BE NOTED THAT EXPLANATION GIVEN BY THE PUNE PART Y IS NOT SUCH WHICH WILL ABSOLVE IT OF ANY WRONG DOING. THEREFORE, IT CANNOT BE SAID THAT IT WAS TRYING TO SHIFT THE BURDEN ON THE APPELLANT. INCOME TAX PR OCEEDINGS CANNOT BE SUBJECTED TO RIGOUR OF CRIMINAL PROCEEDINGS. THE RU LE OF NATURAL JUSTICE TOGETHER WITH THE PRINCIPLES OF HUMAN PROBABILITY W OULD GOVERN THE LAW A OF APPRECIATION OF EVIDENCES IN RESPECT OF INCO ME TAX PROCEEDINGS. THE DOCUMENTS RECEIVED AND OTHER PAPERS WERE GIVE N TO THE APPELLANT DURING THE COURSE OF APPELLATE PROCEEDINGS. THE APPELLANT , EXCEPT DENYING AND FILING AN AFFIDAVIT THAT IT HAS NOT RECEIVED CASH , HAS NOT BEEN ABLE TO REBUT THE EVIDENCES FOUND. THIS AFFIDAVIT IS NOTHIN G BUT SELF SERVING DOCUMENT AND CANNOT OVERCOME THE EVIDENCE ALREADY A VAILABLE ON RECORD. IN FACT THE AFFIDAVIT HAS TO BE CONSIDERED AS NOT CORR ECT. IN MY CONSIDERED SMC-ITA NOS. 2038 TO 2040/AHD/2010 SHRI LALIT M. PATEL VS. ITO AYS : 1998-99 TO 2000-01 3 OPINION THE KIND OF EVIDENCE WHICH WAS FOUND, IF IG NORED ONLY ON THE BASIS OF AFFIDAVIT THEN, IT WILL BE AN INJUSTICE TO THE REVENUE. THE EVIDENCE FOUND FIRMLY ESTABLISH THAT THE APPELLANT HAD PROVIDED A CCOMMODATION ENTRIES FOR WHICH IT HAD RECEIVED RS.6,00,000/- AS REMUNERATION .THE ADDITION HAS BEEN MADE RIGHTLY BY THE AO. THIS GROUND IS ACCORDINGLY DISMISSED. (SIMILAR REASONS ARE GIVEN IN OTHER ORDERS FOR AY 1998-99 AND 1999-00 AS WELL). 4. AGGRIEVED, THE ASSESSEE IS IN APPEALS BEFORE THE TRIBUNAL. 5. LD. COUNSEL FOR THE ASSESSEE CONTENDS THAT THE A SSESSEE FILED AN AFFIDAVIT WHICH HAS NOT BEEN PROPERLY CONSIDERED AN D CONTROVERTED BY THE AUTHORITIES BELOW; THEREFORE, THERE IS NO JUSTIFICA TION IN CONFIRMING THE IMPUGNED ADDITION. 6. LD. DEPARTMENTAL REPRESENTATIVE, ON THE OTHER HA ND, VEHEMENTLY CONTENDS THAT THE ASSESSEE WAS GIVEN ADEQUATE OPPOR TUNITIES TO CONTROVERT THE STATEMENTS GIVEN BY DIRECTOR OF M/S. A.P. BUILD ERS WHICH CLEARLY INDICTED THE ASSESSEE HAVING RECEIVED THE ABOVE CON SIDERATION. IN SUPPORT OF CONTENTS OF AFFIDAVIT NO COGENT MATERIAL OR EVIDENC E WAS FURNISHED. THEREFORE, THE MUCH TOUTED AFFIDAVIT IS NOTHING BUT A SELF-SERVING MATERIAL TO SOMEHOW WRIGGLE OUT OF THE STICKY SITUATION AND A V AIN ATTEMPT TO SHIFT ASSESSEES ONUS TO OTHERS. ASSESSEE HAS FAILED TO A DVANCE EVEN A SEMBLANCE OF LOGIC WHY HUGE MONEYS WERE GIVEN PRO BONO TO M/S . A.P. BUILDERS. M/S. A.P. BUILDERS OWNED UP THE ENTRIES PROVIDED BY ASSE SSEE AS THEIR INCOME, PAID TAXES THEREON. IN CATEGORICAL TERMS IT WAS AFF IRMED THAT FOR THESE SERVICES AND ARRANGEMENT, ASSESSEE WAS PAID ABOVE C ONSIDERATION, WHICH HAS BEEN RIGHTLY ADDED TO ASSESSEES INCOME. THE AS SESSEE HAVING COMPLETELY FAILED TO DISCHARGE HIS ONUS, THE ADDITI ON HAS BEEN RIGHTLY CONFIRMED BY LD. CIT(A). 7. I HAVE HEARD THE RIVAL CONTENTIONS, PERUSED THE MATERIAL AVAILABLE ON RECORD AND GONE THROUGH THE ORDERS OF THE AUTHORITI ES BELOW. THE FACTUAL FINDINGS OF THE LD. CIT(A) ARE CONVINCING. ASSESSE ES COUNSEL HAS ONLY SMC-ITA NOS. 2038 TO 2040/AHD/2010 SHRI LALIT M. PATEL VS. ITO AYS : 1998-99 TO 2000-01 4 STRESSED THE CONTENTION THAT AFFIDAVIT HAS NOT BEEN CONTROVERTED. MERE FILING OF THE AFFIDAVIT DOES NOT END THE ASSESSEES ONUS A S THE ENTIRE SET OF FACTS IS TO BE VIEWED ON THE BASIS OF MATERIAL AVAILABLE ON REC ORD. IN VIEW OF THE STATEMENT OF M/S. A.P. BUILDERS AND THEIR OWNING UP INCOME IN THIS BEHALF AND PAYMENT OF ABOVE SUMS THE ADDITIONS ARE JUSTIFI ED. THE ADDITIONS ARE BASED PROPER FINDING BASED ON PREPONDERANCE OF PROB ABILITIES, HUMAN CONDUCT AND OTHER MATERIAL AVAILABLE ON RECORD AS E LUCIDATED BY HONBLE SUPREME COURT IN THE CASE OF SMT. SUMATI DAYAL 214 ITR 801. THERE IS NO MERIT IN THE CONTENTION OF THE LD. COUNSEL FOR THE ASSESSEE THAT THE ADDITION SHOULD BE DELETED MERELY BECAUSE THE AFFIDAVIT IS F ILED IGNORING THE CRUCIAL FACTS THAT DESPITE OPPORTUNITIES, ASSESSEE FAILED T O DISLODGE THE INDICTING STATEMENT OF DIRECTOR OF M/S. A.P. BUILDERS, WHO OW NED UP THE AMOUNTS AND PAID TAXES THEREON. IN VIEW THESE FACTS AND CIRCUM STANCES, I FIND NO INFIRMITY IN THE ORDERS OF THE AUTHORITIES BELOW CO NFIRMING THE IMPUGNED ADDITIONS FOR THE ASSESSMENT YEARS UNDER CONSIDERAT ION. THE ADDITIONS IN QUESTION ARE ACCORDINGLY UPHELD AND THE ASSESSEES APPEALS ARE THUS DISMISSED. 8. IN THE RESULT, ALL THE APPEALS FILED BY THE ASSE SSEE ARE DISMISSED. SD/- R.P. TOLANI (JUDICIAL MEMBER) AHMEDABAD; DATED 17/02/2017 *BIJU T., SR. PS / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. / CONCERNED CIT 4. ( ) / THE CIT(A) 5. , , / DR, ITAT, AHMEDABAD 6. / GUARD FILE . / BY ORDER, TRUE COPY / ( DY./ASSTT.REGISTRAR) , / ITAT, AHMEDABAD