ITO, Ward -1(1), Hooghly, Hooghly V. Shri Pradyut Kumar Das, Hooghly

ITA 2102/KOL/2010

• Counselvise Citation: [2011] 140 COUNSELVISE.COM (IT) 54767 (ITAT-KOLKATA)
• Duration Of Justice: 1 year(s) 1 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-12-2011
• Appeal Filed By: Department
• Bench Allotted: C
• Assessment Year: 2005-2006
• Appeal Filed On: 22-11-2010
• Court: TRIBUNAL
• Department Lawyers: S K ROY
• Assessee Lawyers: SOMNATH GHOSH
• Keywords: Unexplained cash credit; Unexplained investment; Gift; Opportunity of being heard; Corroborative evidences

Judgement Text

1 , B , , IN THE INCOME TAX APPELLATE TRIBUNAL, BENCH- B , KO LKATA [ , . .. . ! ! ! !. .. . , , , , '# ] BEFORE SRI N.VIJAYAKUMARAN, JUDICIAL MEMBER & SRI C.D. RAO, AC COUNTANT MEMBER $ $ $ $ / ITA NO. 2102 (KOL) OF 2010 %& '( / ASSESSMENT YEAR 2005-06 INCOME-TAX OFFICER, WARD-1(1), HOOGHLY. PRADYUT KUMAR DAS, HOOGHLY. (PAN-ADAPD0177A) (+, / APPELLANT ) - - - VERSUS -. (/0+,/ RESPONDENT ) 1 2 1 2 1 2 1 2 / C.O. NO. 03 (KOL) OF 2011 [ $ / ITA NO. 2102 (KOL) OF 2010 ] %& '( / ASSESSMENT YEAR 2005-06 PRADYUT KUMAR DAS, - - INCOME-TAX OFFICER, WARD 1(1), HOOGHLY. (PAN- ADAPD0177A) - VERSUS - HOOGHLY ( 1 2 / CROSS-OBJECTOR ) ( /0+,/ RESPONDENT ) $ $ $ $ / ITA NO. 1845 (KOL) OF 2010 %& '( / ASSESSMENT YEAR 2005-06 PRADYUT KUMAR DAS, HOOGHLY. (PAN- ADAPD0177A) INCOME-TAX OFFICER, WARD -1(1), HOOGHLY (+, / APPELLANT ) - - - VERSUS -. (/0+,/ RESPONDENT ) FOR THE DEPARTMENT: / SRI S.K. ROY FOR THE ASSESSEE: / SRI SOMNATH GHOSH 3 4 !# / DATE OF HEARING : 08/12/2011 5' 4 !# / DATE OF PRONOUNCEMENT : 29/12/2011 '6 / ORDER ( . .. . ! ! ! !. .. . ), '# (C.D. RAO), ACCOUNTANT MEMBER : THE AFORESAID CROSS APPEALS, ONE BY THE DEPARTMEN T AND THE OTHER BY THE ASSESSEE, AND THE CROSS-OBJECTION OF THE ASSESSEE O R ASSESSMENT YEAR 2005-06 ARISE OUT OF THE ORDER DATED 09/9/2010 OF LD. C.I.T.(A)-XXXVI , KOLKATA. AS SOME COMMON ISSUES 2 ARE INVOLVED, WE DISPOSE OF THE AFORESAID APPEALS A ND CROSS-OBJECTION BY THIS COMMON ORDER. 2. IN THESE APPEALS, THE LD. C.I.T.(A) UPHELD THE A CTION OF THE LD. A.O. IN RE-OPENING OF THE ASSESSMENT. HE, HOWEVER, CONSIDERING THE ASSESS MENT ORDER, ASSESSEES SUBMISSIONS AND EVIDENCES FILED BEFORE HIM GAVE PARTIAL RELIEF TO THE ASSESSEE UNDER DIFFERENT HEADS AS UNDER :- (1) RS.25,00,000/- CAPITAL CONTRIBUTION TO THE PARTNERSHIP FIRM, NUTAN SARADA HIMGHAR BY TAKING C.C. LOAN FROM UCO BANK ADDITIO N DELETED. (2) RS.10,00,000/- CAPITAL CONTRIBUTION TO THE SAID FIRM FROM ASSESSEES PAST SAVINGS REFLECTED IN THE BALANCE SHEET AS AT 31/3/2005 AD DITION UPHELD. (3) RS.36,00,000/- AS UNDISCLOSED INVESTMENTS I N IMMOVABLE PROPERTIES ADDITION RESTRICTED TO RS.10,00,000/- IN PLACE OF RS.36 LAKH S. (4) RS.3,81,000/- BEING NET PROFIT FROM TRADING BUSINESS OF POTATO, JUTE & JUTE BAGS SHOWN TO BANK WHILE APPLYING FOR C.C. LOAN ADDITI ON CONFIRMED. (5) RS.1,50,000/- BEING UNEXPLAINED DEPOSITS IN UCO BANK ADDITION CONFIRMED. (6) RS.30,000/- BEING GIFT FROM MOTHER TREATED AS UNEXPLAINED CASH CREDIT ADDITION CONFIRMED. AGAINST THE ABOVE DELETION AND SUSTENANCE OF THE A DDITIONS BY LD. C.I.T.(A), THE DEPARTMENT AS WELL AS THE ASSESSEE BOTH HAVE PREFER RED APPEAL BEFORE THE TRIBUNAL. THE ASSESSEE HAS ALSO FILED A CROSS-OBJECTION RAISING T HE SIMILAR GROUNDS AS ARE TAKEN IN THE APPEAL FILED AGAINST THE ORDER OF LD. C.I.T.(A). 3. THE FIRST GROUND IN ASSESSEES APPEAL AS WELL A S IN THE CROSS-OBJECTION AGAINST ASSUMPTION OF JURISDICTION U/S. 147 AND PASSING ORD ER U/S. 147/144 OF THE ACT, DULY CONFIRMED BY THE LD. C.I.T.(A), HAS NOT BEEN PRESSE D BY THE LEARNED COUNSEL FOR THE ASSESSEE AT THE TIME OF HEARING. HENCE THE ABOVE G ROUNDS ARE DISMISSED AS NOT PRESSED. 4. IN REGARD TO ISSUES (1) & (2) ABOVE, WHICH HAVE BEEN AGITATED IN GROUND NO. 1 IN REVENUES APPEAL AND GROUND NO. 2 OF THE ASSESSEES APPEAL AS WELL AS IN CROSS-OBJECTION, THE FACTS ARE THAT THE ASSESSEE ACTS AS AN AGENT OF LIC OF INDIA AND HE IS ALSO A PARTNER OF A FIRM, NUTAN SARADA HIMGHAR. THE LD. A.O. OBSE RVED THAT THE ASSESSEE MADE INVESTMENT OF RS.35,00,000/- TOWARDS HIS CAPITAL CO NTRIBUTION TO HIS SAID PARTNERSHIP FIRM AND THE SAME IS REFLECTED IN HIS BALANCE SHEET AS AT 31/3/2005. THE SOURCE OF THE 3 SAID INVESTMENT WAS STATED TO BE RS.25 LAKHS AS LOA N FROM UCO BANK, SAHAPUR BRANCH AND THE BALANCE OF RS.10 LAKHS WAS EXPLAINED TO BE FROM THE SOURCES AVAILABLE WITH THE ASSESSEE FROM THE BALANCE SHEET. THE LD. A.O., HOW EVER, ALLEGED THAT THE ASSESSEE FAILED TO FURNISH THE INCOME FROM REMUNERATION AND INTERES T ON CAPITAL AMOUNTING TO RS.25,000/- AND RS.52,000/- RESPECTIVELY FROM THE P ARTNERSHIP FIRM AND THUS TREATED THE ENTIRE INVESTMENT OF RS.35 LAKHS IN THE SAID FI RM AS UNEXPLAINED U/S. 69 OF THE ACT. 5. ON APPEAL, THE LD. C.I.T.(A) AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE AND EVIDENCES PRODUCED IN SUPPORT OF HIS SUBMISSIONS HE LD THAT THE CAPITAL CONTRIBUTION IN THE FIRM TO THE EXTENT OF RS.25 LAKHS STOOD EXPLAINED A ND THE BALANCE CAPITAL CONTRIBUTION OF RS. 10 LAKHS REMAINED UNEXPLAINED. HE, THEREFORE, DIRECTED THE LD. A.O. TO RESTRICT THE ADDITION TO RS.10 LAKHS IN PLACE OF RS.35 LAKHS BY OBSERVING AS UNDER :- THE AUTHORIZED REPRESENTATIVE SUBMITTED THAT THE A PPELLANT, ON THE SECURITY OF IMMOVABLE PROPERTIES OBTAINED CASH CREDIT LOAN OF R S.25,00,00/- FROM THE U.CO. BANK, SAHAPUR BRANCH. THIS IS ALSO CONFIRMED BY TH E BANK STATEMENT OF THE APPELLANTS CASH LOAN A/C NO. 125 WITH U.CO. BANK, SAHAPUR BRANCH FOR THE YEAR 2004-05. THE ABOVE LOAN OF RS.25,00,000/- WAS DEBI TED THE ABOVE ACCOUNT ON 25.02.2005 AND 3 DEMAND DRAFTS FOR RS.9 LAKHS, RS.9 LAKHS AND RS.7 LAKHS WERE PURCHASED IN FAVOUR OF SHRI TAPAN KUMAR SINHA (WHO, ALONG WITH OTHER PARTNERS SOLD THE COLD STORAGE UNIT TO M/S. NUTAN SHARDA HIM GARH, A FIRM IN WHICH THE APPELLANT AND ANOTHER ARE PARTNERS). THEREFORE, THE PAYMENT MADE BY THE APPELLANT, MADE TO SHRI TAPAN SINHA, TOWARDS HIS CA PITAL CONTRIBUTION IN THE FIRM M/S. NUTAAN SARADA HIMGHAR STANDS EXPLAINED TO THE TUNE OF RS.25.00 LAKHS. THAT LEAVES BALANCE CAPITAL CONTRIBUTION OF THE APPELLAN T TO THE TUNE OF RS.10,00,000/- IN THE SAME FIRM I.E. M/S NUTAAN SARADA HIMGHAR. AS CAN BE SEEN FROM THE WRITTEN SUBMISSIONS OF THE AUTHORIZED REPRESENTATIV E, IT WAS SUBMITTED THAT THE SOURCES WERE AVAILABLE AS PER THE BALANCE SHEET AND THEREFORE THE SAME WAS STATED TO BE EXPLAINED. IN THIS REGARD THE AR FILED CASH FLOW STATEMENT OF THE APPELLANT FOR THE YEAR. HOWEVER, THIS DOES NOT EXPL AIN HOW THE AMOUNTS WERE RECEIVED AND HOW PAYMENTS WERE MADE TO THE FIRM. TH E AMOUNTS SHOWN AS RECEIVED IN THE CASH FLOW STATEMENT ARE NOT VERIFIA BLE. NO DETAILS WERE MADE AVAILABLE INDICATING AS TO HOW THE AMOUNT OF RS.1O, 00,000F- WAS PAID TOWARDS THE APPELLANTS CAPITAL CONTRIBUTION. FURTHER, NO SPECI FIC DETAILS ARE MADE AVAILABLE REGARDING THE ABOVE PAYMENT, LIKE DRAFT OR CHEQUE O R CASH, SOURCE THEREFORE ETC. THEREFORE, THE CAPITAL CONTRIBUTION IN THE PARTNERS HIP FIRM FOR RS.10,00,000/- REMAINS UNEXPLAINED. THE DECISION RELIED ON BY THE APPELLANT, IN THE CASE OF USHAKANT N. PATE! -VS- C.I.T. (2006) 282 ITR 553 (G UJ) ALSO DOES NOT HELP THE APPELLANTS CASE BECAUSE THE APPELLANT DID NOT DISC HARGE THE ONUS OF EXPLAINING THE SOURCES FOR HIS CAPITAL CONTRIBUTION IN THE FIRM. C ONSIDERING ALL, I HOLD THAT THE SOURCES FOR THE CAPITAL CONTRIBUTION IN THE FIRM M/ S. NUTAAN SARADA HIMGHAR TO 4 THE TUNE OF RS.10,00,000/- REMAINS UNEXPLAINED. ACC ORDINGLY, THE AO IS DIRECTED TO RESTRICT THE ADDITION TO RS.10,00,000/- IN THE P LACE OF RS.35,00,000/-. BEING AGGRIEVED, BOTH THE DEPARTMENT AND THE ASSESS EE ARE IN APPEAL BEFORE US. 6. AT THE TIME OF HEARING BEFORE US, THE LD. DEPAR TMENTAL REPRESENTATIVE SUBMITTED THAT C.C. LOAN FROM BANK CAN ONLY BE AVAILED BY A P ERSON WHO HAS ANY BUSINESS ACTIVITY. IN THE RETURN, THE ASSESSEE HAS NOT SHOWN ANY BUSINESS ACTIVITY OF POTATO, JUTE AND JUTE BAGS WHICH HE DISCLOSED IN THE PROCESS NOTE SUBMITT ED TO THE BANK FOR OBTAINING THE C.C. LOAN OF RS. 25 LAKHS. FURTHER, ALTHOUGH THE ASSESS EE CLAIMED TO BE ONE OF THE PARTNERS IN NUTAN SARADA HIMGHAR, BUT HE FAILED TO FURNISH THE INCOME FROM REMUNERATION AND INTEREST ON CAPITAL CONTRIBUTION. THEREFORE, THE L D. A.O. HAS RIGHTLY INVOKED SEC. 69 OF THE ACT IN MAKING THE ADDITION OF RS.35 LAKHS AS UN DISCLOSED INVESTMENT IN NUTAN SARADA HIMGHAR AND THE LD. C.I.T.(A) WITHOUT PROPER APPREC IATION OF THE FACTS AND CIRCUMSTANCES HAS WRONGLY DELETED THE ADDITION TO THE EXTENT OF R S.25 LAKHS ON ACCOUNT OF C.C. LOAN FROM UCO BANK. HE HAS, HOWEVER, SUPPORTED THE ORDE R OF THE LD. C.I.T.(A) IN SO FAR AS UPHOLDING THE ADDITION OF THE BALANCE SUM OF RS.10 LAKHS U/S. 69 OF THE ACT. 7. ON THE OTHER HAND, THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE LD. A.O. HIMSELF VERIFIED FROM THE BANK THAT THE ASSESS EE TOOK C.C. LOAN OF RS.25 LAKHS FROM UCO BANK AFTER COMPLETION OF THE FORMALITIES AND TH E SAID LOAN WAS TRANSFERRED TO C.C. LOAN ACCOUNT OF THE ASSESSEE WITH THE BANK AND IN T URN THE ASSESSEE INVESTED IN THE PARTNERSHIP FIRM, NUTAN SARADA HIMGHAR, FOR PURCHAS E OF HIS SHARE OF THE PROPERTY FROM THE ERSTWHILE OWNERS, IN WHOSE FAVOUR 3 DEMAND DRAF TS FOR RS. 9 LAKHS, RS. 9 LAKHS AND RS. 7 LAKHS (TOTAL RS.25 LAKHS) WERE PURCHASED AND THE SAME WERE DEBITED IN HIS C.C. ACCOUNT WITH THE BANK AND ALSO REFLECTED IN THE ASS ESSEES BALANCE SHEET AS AT 31/3/2005. ALL THESE INFORMATION FROM THE BANK AND OTHER RELEVANT DETAILS, WHICH WERE FILED BEFORE THE AUTHORITIES BELOW AND ALSO FILED A T PAGES 18 TO 25 OF THE PAPER BOOK, CLEARLY EXPLAIN THE SOURCE OF THE INVESTMENT OF RS. 25 LAKHS IN THE PARTNERSHIP FIRM. THEREFORE, THE LD. C.I.T.(A) HAS JUSTIFIABLY DELETE D THE ADDITION OF RS.25 LAKHS MADE BY INVOKING SEC. 69 OF THE ACT. WITH RESPECT TO THE BALANCE INVESTMENT OF RS.10 L AKHS WITH THE PARTNERSHIP FIRM, THE LD. COUNSEL SUBMITTED THAT THE ASSESSEE HAD AVA ILABLE FUNDS WITH HIM IN EXCESS OF RS. 5 10 LAKHS IN HIS BALANCE SHEET AS AT 31/3/2005. HE FURTHER SUBMITTED THAT IN THE BALANCE SHEET, ITEM-WISE ENTRY IN LIABILITY AS WELL AS ASSE T SIDE HAS BEEN REFLECTED, WHICH CLARIFIES THE SOURCE OF THE ABOVE INVESTMENT IN THE PARTNERSH IP. THE AVAILABILITY OF FUND IS ALSO SUPPORTED BY CASH FLOW STATEMENT. REFERRING TO THE OBSERVATION OF THE LD. C.I.T.(A) THAT CASH FLOW STATEMENT DOES NOT EXPLAIN HOW THE AMOUNT S WERE RECEIVED AND PAYMENTS MADE TO THE FIRM AS CAPITAL CONTRIBUTION, THE LD. COUNSE L REFUTED THE SAME BY STATING THAT AS PER CASH & BANK INFLOW AND OUTFLOW STATEMENT FOR TH E PERIOD FROM 01/4/2004 TO 31/3/2005, PLACED AT PAGE-50 OF THE PAPER BOOK, FUL L PARTICULARS OF ITEM-WISE RECEIPTS AND PAYMENTS HAVE BEEN SHOWN WHICH CLEARLY REFLECTS THE INVESTMENT OF RS.10 LAKHS WITH THE PARTNERSHIP FIRM. THE BALANCE SHEET AS AT 31/3/ 2005 WAS ALSO DRAWN ON THE BASIS OF SUCH CASH FLOW STATEMENT. THEREFORE, THE ALLEGATIO N OF THE LD. C.I.T.(A) IS BASED ON CONJECTURE AND WITHOUT APPRECIATING THE AFORESAID A CCOUNTS IN A PROPER PERSPECTIVE, MORE SO WHEN THE AUTHORITIES BELOW COULD NOT SPECIFY ANY DEFECT IN SUCH ENTRIES IN THE CASH FLOW STATEMENT VIS--VIS BALANCE SHEET. THEREFORE, THE ASSESSEE HAS DISCHARGED HIS ONUS IN TERMS OF SEC. 69 OF THE ACT IN EXPLAINING THE SO URCES OUT OF WHICH RS.10 LAKHS WAS INVESTED IN THE FIRM. HE, THEREFORE, SUBMITTED THA T THE LD. C.I.T.(A) HAS MISCONSTRUED THE PROVISION IN UPHOLDING THE ADDITION OF RS.10 LA KHS WHICH WAS NOT IN CONSONANCE WITH THE LAW AND THE FACTS OF THE CASE. 8. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL PLACED ON RECORD. WITH RESPECT TO THE ADDITION OF RS.25 LAKHS WE OBSE RVE THAT LOAN TAKEN BY THE ASSESSEE THROUGH HIS C.C. ACCOUNT MAINTAINED WITH UCO BANK A ND IN TURN PAYMENTS BY DEMAND DRAFTS TO THE ERSTWHILE OWNERS OF THE PARTNERSHIP F IRM HAS BEEN VERIFIED BY THE A.O. HIMSELF WITH THE BANK, WHICH HE DID NOT DISPUTE. T HE INVESTMENT IS ALSO REFLECTED IN THE ASSESSEES BALANCE SHEET. IN THAT VIEW OF THE MATT ER, IN OUR CONSIDERED OPINION, THE LD. C.I.T.(A) HAS RIGHTLY ACCEPTED THE INVESTMENT OF RS .25 LAKHS OUT OF EXPLAINED SOURCES. WE, THEREFORE, UPHOLD HIS ORDER ON THIS ISSUE AND T HE GROUND RAISED BY THE DEPARTMENT IS DISMISSED AND THAT BY THE ASSESSEE IS ALLOWED. 8.1. WITH RESPECT THE BALANCE INVESTMENT OF RS.10 LAKHS, THE LD. C.I.T.(A) HAS UPHELD THE ADDITION SOLELY ON THE GROUND THAT AMOUNTS SHOW N AS IN FLOW AND OUTFLOW IN THE CASH/ BANK INFLOW & OUTFLOW STATEMENT DO NOT SHOW HOW THE AMOUNTS WERE RECEIVED AND 6 PAYMENTS WERE MADE TO THE FIRM. ON PERUSAL OF THE CASH FLOW STATEMENT PLACED AT PAGE- 50 OF THE PAPER BOOK, WE OBSERVE THAT IN INFLOW SID E OF THE STATEMENT SPECIFIC HEAD-WISE RECEIPTS HAVE BEEN SHOWN AND THE SAME IS THE POSITI ON IN OUTFLOW SIDE OF THE SAID STATEMENT, WHICH INCLUDES INVESTMENT OF RS.35 LAKHS [RS.25 LAKHS + RS.10 LAKHS] IN THE PARTNERSHIP FIRM. DURING COURSE OF ASSESSMENT PROC EEDINGS, THE LD. A.O. REQUIRED THE ASSESSEE TO FURNISH THE DETAILS OF INVESTMENT OF RS .10 LAKHS ALONG WITH CASH FLOW STATEMENT AND THE SAME WAS FURNISHED TO HIM. THE A .O. HAS NOT COMMENTED UPON ANYTHING UPON SUCH DOCUMENTS. AS STATED BY THE LD. C.I.T.(A), THE LD. A.O. TREATED THE INVESTMENT AS UNEXPLAINED U/S. 69 OF THE ACT ON THE ALLEGATION THAT ALTHOUGH AS PER PARTNERSHIP DEED THE ASSESSEE DERIVES REMUNERATION AND INTEREST ON CAPITAL, BUT HE FAILED TO EXPLAIN THE SAME. IN OUR CONSIDERED OPINION, TH IS CANNOT BE A CONVINCING REASON FOR DISBELIEVING THE AFORESAID INVESTMENT WHEN NO SPECI FIC DEFECTS WERE POINTED OUT IN SUCH CASH FLOW STATEMENT SHOWING SOURCES OF FUNDS. AFTER CONSIDERING THE FACTS AND CIRCUMSTANCES OF THE CASE AND THE EVIDENCE AVAILABL E ON RECORD, WE ARE OF THE CONSIDERED OPINION THAT THERE IS NO JUSTIFICATION IN MAKING AN ADDITION OF RS. 10 LAKHS AS UNEXPLAINED INVESTMENT BY INVOKING PROVISION OF SEC.69 OF THE A CT. SEC. 69 OF THE ACT READS AS UNDER: 69. WHERE IN THE FINANCIAL YEAR IMMEDIATELY PRECEDING T HE ASSESSMENT YEAR THE ASSESSEE HAS MADE INVESTMENTS WHICH ARE NOT RECORDE D IN THE BOOKS OF ACCOUNT, IF ANY, MAINTAINED BY HIM FOR ANY SOURCE OF INCOME, AN D THE ASSESSEE OFFERS NO EXPLANATION ABOUT THE NATURE AND SOURCE OF THE INVE STMENTS OR THE EXPLANATION OFFERED BY HIM IS NOT, IN THE OPINION OF THE [ASSES SING] OFFICER, SATISFACTORY, THE VALUE OF THE INVESTMENTS MAY BE DEEMED TO BE THE IN COME OF THE ASSESSEE OF SUCH FINANCIAL YEAR. THEREFORE, AS PER SEC. 69, ADDITION ON ACCOUNT OF U NEXPLAINED INVESTMENT IS CALLED FOR WHEN THE INVESTMENT MADE BY THE ASSESSEE IS NOT REC ORDED IN THE BOOKS OF ACCOUNT, IF ANY, MAINTAINED BY HIM AND THE ASSESSEE OFFERS NO E XPLANATION ABOUT THE NATURE AND SOURCE OF THE INVESTMENT OR THE EXPLANATION OFFERED BY THE ASSESSEE IS NOT FOUND SATISFACTORY BY THE A.O. HERE IN THIS CASE, THE AS SESSEE HAS SHOWN THE SOURCE OF RS. 10 LAKHS ON THE BASIS OF CASH FLOW STATEMENT. THE DIS BURSEMENTS OF FUNDS UNDER DIFFERENT HEADS ARE ALSO REFLECTED THEREIN. THE ASSESSEE HAS FURNISHED ALL THE POSSIBLE EVIDENCES AS MENTIONED ABOVE IN SUPPORT OF HIS RECEIVING THE FUND AND DISBURSEMENT THEREOF. THEREFORE, WHEN THE ASSESSEE HAS SUBMITTED ALL THE POSSIBLE EVIDENCES IN SUPPORT OF HIS 7 EXPLANATION, IT WAS UNFAIR ON THE PART OF THE AUTHO RITIES BELOW TO TREAT THE SAID INVESTMENT AS ASSESSEES UNDISCLOSED INVESTMENT U/S . 69 OF THE ACT. IN THIS CONNECTION, WE DERIVE SUPPORT FROM THE DECISION OF HONBLE SUPR EME COURT IN THE CASE OF C.I.T. VS. NOORJAHAN (P.K.)(SMT.) [237 ITR 570 (SC)], WHEREIN IT HAS BEEN HELD THAT MERE REJECTION OF AN EXPLANATION WOULD NOT AUTOMATICALLY ENTITLE T HE LD. A.O. TO CONCLUDE THAT THE ASSESSEE HAD CONCEALED THE PARTICULARS OF INCOME AN D FOR THAT PURPOSE ADDITION MADE U/S. 69 OF THE ACT SHALL NOT BE WARRANTED. KEEPING IN V IEW ALL THE FACTS AND CIRCUMSTANCES OF THE CASE AND THE EVIDENCES ON RECORD, WE DEEM IT PR OPER TO DELETE THE ADDITION OF RS.10 LAKHS. THEREFORE, GROUND NO.1 OF THE REVENUES APP EAL IS DISMISSED AND GROUND NO. 2 OF THE ASSESSEES APPEAL AS WELL AS CROSS-OBJECTION IS ALLOWED. 9. IN REGARD TO DISPUTE (3) ABOVE ON ACCOUNT OF AD DITION OF RS.36 LAKHS AS UNDISCLOSED INVESTMENTS IN IMMOVABLE PROPERTIES, WHICH HAS BEEN AGITATED IN GROUND NO. 2 IN REVENUES APPEAL AND IN GROUNDS NO. 3 & 4 OF THE ASSESSEES A PPEAL AS WELL AS CROSS-OBJECTION, THE FACTS ARE THAT THE ASSESSEE OBTAINED C.C. LOAN OF R S.25 LAKHS FROM UCO BANK FOR INVESTMENT IN HIS PARTNERSHIP BUSINESS. IN THE PRO CESS OF TAKING SUCH LOAN, AS PER TERMS OF THE BANK, THE ASSESSEE PLEDGED/MORTGAGED HIS LAN DED PROPERTIES WITH THE BANK IN GUARANTEE OF SUCH LOAN. THE ASSESSEE STATED BEFORE THE DEPARTMENT THAT FOR FACILITATING THE LOAN, HE DECLARED THE VALUE OF THE MORTGAGED PR OPERTY AT ENHANCED VALUE IN THE SUM OF RS.36 LAKHS. THE COST OF SUCH LANDED PROPERTY PU RCHASED BETWEEN 1999-2000 AND 2001-02 WAS SHOWN FROM YEAR TO YEAR AT RS.1,66,500/ - IN HIS BALANCE SHEET. THE DETAILS OF SUCH IMMOVABLE PROPERTIES OWNED BY THE ASSESSEE ARE GIVEN ON PAGE-12 OF THE LD. C.I.T.(A)S ORDER SHOWING TOTAL PURCHASE VALUE IN T HE SUM OF RS.2,57,500/-. HOWEVER, ACCORDING TO THE LD. A.O., AS THE ASSESSEE DECLARED BEFORE THE BANK THE VALUE OF HIS IMMOVABLE PROPERTIES AT RS.36 LAKHS, THEREFORE, THE ASSESSEE MADE UNEXPLAINED INVESTMENT IN THE PROPERTY WHICH WAS NOT DISCLOSED IN THE RETURN OF INCOME FILED. HE, THEREFORE, ADDED THE SUM OF RS.36 LAKHS U/S. 69 OF THE ACT. 10. BEFORE THE LD. C.I.T.(A), THE ASSESSEE CONTEND ED THAT INFLATED VALUE OF IMMOVABLE PROPERTIES SHOWN IN THE PROCESS NOTE AT 36 LAKHS WA S ONLY FOR OBTAINING C.C. LOAN AND NO FRESH INVESTMENT WAS MADE EITHER IN EXISTING PROPER TIES ON IN ANY NEW IMMOVABLE PROPERTIES. THE LD. C.I.T.(A) AFTER PERUSING THE CO PIES OF THE PURCHASE DEEDS AND SALE 8 DEEDS IN RESPECT OF IMMOVABLE PROPERTIES OWNED BY T HE ASSESSEE AND CONSIDERING THE FACT OF MORTGAGING THE SAME WITH UCO BANK FOR OBTAI NING C.C. LOAN FOUND THE LD. A.O.S ASSERTION TO BE INCORRECT FOR MAKING ADDITION ON AC COUNT OF UNEXPLAINED INVESTMENT. AT THE SAME TIME, THE LD. C.I.T.(A) MADE FRESH ADDITIO N TO THE EXTENT OF RS.10 LAKHS ON DIFFERENT REASONINGS. THE ASSESSEE EXPLAINED BEFORE HIM THAT HE DID NOT CARRY OUT ANY BUSINESS IN POTATO, JUTE & JUTE BAGS AND THE NET PR OFIT WAS ONLY IMAGINARY FIGURE SUBMITTED BEFORE THE BANK FOR THE PURPOSE OF AVAILI NG C.C. LOAN OF RS. 25 LAKHS. ON THESE FACTS, THE LD. C.I.T.(A) HELD AS UNDER :- I HAVE CAREFULLY CONSIDERED THE ABOVE. THE ABOV E STATEMENTS REGARDING TRADING BUSINESS WERE FILED BY THE APPELLANT BEFORE THE UCO BANK. THEREFORE, THE ONUS IS ON THE APPELLANT TO SUBSTANTIATE THAT THERE WAS NO SUCH BUSINESS. FROM THE WEIGHT OF THE EVIDENCE DISCUSSED ABOVE, I AM ALSO O F THE VIEW THAT THE APPELLANT DURING THE PREVIOUS YEAR CARRIED OUT TRADING BUSINE SS OF POTATO, JUTE AND JUTE BAGS. FURTHER, THE DETAILS OF THIS BUSINESS (FURNI SHED BEFORE THE UCO BANK) WERE NOT CONTROVERTED BY THE APPELLANT/A.R. EVEN AT APPE LLATE STAGE. CONSIDERING ALL, PARTICULARLY CONSIDERING THE NET PROFIT ADMITTED BY THE APPELLANT, I AM OF THE VIEW THAT THE APPELLANTS INVESTMENT IN THIS BUSINESS AN D PROFIT THEREFROM SHOULD BE CONSIDERED IN THE ASSESSMENT. THE NEXT ISSUE IS WHAT WOULD BE THE UNEXPLAIN ED INVESTMENT MADE BY THE APPELLANT IN THE BUSINESS OF POTATO, JUTE AND JUTE BAGS. REASONABLY ASSUMING THAT NET PROFIT IN THE LINES OF BUSINESS WOULD BE ABOUT 20%, THE TOTAL TURNOVER FOR THE YEAR CAN BE ESTIMATED AT RS.19,05,000/-. CONSIDERI NG THE ABOVE, THE UNEXPLAINED INVESTMENT IN THE POTATO, JUTE AND JUTE BAGS BUSINE SS CAN BE FAIRLY ESTIMATED AT RS. 10.00 LAKHS. SINCE, THIS INVESTMENT AND SOURCE S THEREFORE WERE NOT DISCLOSED BY THE APPELLANT, THE ABOVE AMOUNT REQUIRES TO BE A SSESSED AS UNEXPLAINED INVESTMENTS. THEREFORE, THE ASSESSING OFFICER IS D IRECTED TO RESTRICT THE ADDITION TO RS.10.00 LAKHS IN PLACE OF RS.36,00,000 /-. BEING AGGRIEVED, BOTH THE DEPARTMENT AND THE ASSESS EE ARE IN APPEAL BEFORE US. 11. AT THE TIME OF HEARING, THE LD. DEPARTMENTAL R EPRESENTATIVE RELIED ON THE ORDER OF THE LD. A.O. ON THE OTHER HAND, THE LD. COUNSEL ALTHOUGH SUPPORTED THE ACTION OF THE LD. C.I.T.(A) IN REJECTING THE ASSERTION OF THE LD. A.O. WITH RESPECT TO UNEXPLAINED INVESTMENTS IN IMMOVABLE PROPERTIES AND HELD THE AD DITION OF RS.36 LAKHS TO BE UNJUSTIFIED, BUT OBJECTED TO THE AD HOC ADDITION U/ S. 69 OF THE ACT OF RS.10 LAKHS ON ENTIRELY DIFFERENT REASONING, WHICH IS UNCONNECTED TO THE ISSUE CONSIDERED BY THE LD. A.O. THE LD. C.I.T.(A) CONSIDERED THE INFORMATION OF THE ASSESSEE BEFORE THE BANK IN THE 9 PROCESS NOTE ABOUT RUNNING OF POTATO, JUTE AND JUTE BAGS BUSINESS AND NET PROFIT THEREON OF RS.3,81,000/- AS TRUE AND ON SUCH BELIEF HE PRES UMED THAT THERE MUST BE INVESTMENT IN SUCH BUSINESS WHICH IS UNEXPLAINED. HE FURTHER SUBMITTED THAT, IN FACT, THERE WAS NO SUCH BUSINESS BEING CARRIED ON BY THE ASSESSEE AND THE BUSINESS AND PROFIT THEREON WAS DISCLOSED BEFORE THE BANK ONLY IN THE PROCESS NOTE TO MEET THE BANKS REQUIREMENT TO FACILITATE SANCTIONING OF C.C. LOAN. HE FURTHER SU BMITTED THAT THE PROCESS NOTE OF UCO BANK RELIED ON BY THE LD. C.I.T.(A) IS A DOCUMENT W HICH WAS DISBELIEVED BY HIM IN THE CONTEXT OF VALUATION OF THE LANDED PROPERTY. HE, T HEREFORE, SUBMITTED THAT THE DOCUMENT ON WHICH AD HOC ADDITION OF RS.10 LACS ON AN ESTIMATED TURNOVER OF RS.19,05,000/- WAS MADE IS IRRELEVANT AND INADMISSI BLE MATERIAL AND THE SAME IS UNSUSTAINABLE IN LAW. IN SUPPORT OF HIS SUBMISSION , THE LD. COUNSEL RELIED ON DHIRAJLAL GIRDHARILAL VS. CIT [26 ITR 736 (SC)]. HE ALSO REL IED ON ACIT VS. MANGALAM PUBLICATION [(2010) 190 TAXMAN (MAGAZINE) 1 (ITAT-COCHIN)], A C OPY OF WHICH HAS BEEN FILED. 12. WE HAVE HEARD THE RIVAL SUBMISSIONS OF THE PAR TIES AND PERUSED THE MATERIAL PLACED ON RECORD. ON THE FACTS STATED ABOVE, WE OB SERVE THAT THE ASSESSEE DECLARED VALUE OF HIS IMMOVABLE PROPERTIES AT RS.36 LAKHS BE FORE THE BANK FOR GRANTING C.C. LOAN IN HIS FAVOUR, WHICH IS APPEARING ON PAGE-2 OF THE PRO CESS NOTE, COPY OF WHICH IS ALSO PLACED AT PAGE-21 OF THE PAPER BOOK. THE LD. C.I.T.(A) AF TER PERUSING THE PURCHASE DEEDS OF IMMOVABLE PROPERTIES PLEDGED WITH THE BANK FOUND TH AT THOSE PROPERTIES WERE PURCHASED FOR A TOTAL CONSIDERATION OF RS.2,57,000/-, WHEREAS THE ASSESSEE HAS SHOWN THE VALUE OF SUCH PROPERTIES AT RS.36 LAKHS IN THE PROCESS NOTE OF THE BANK. HE, THEREFORE, HELD THAT SHOWING THEIR VALUE IN THE FINANCIAL YEAR 2004-05 AT RS.36.00 LAKHS, IN MY VIEW, APPEARS TO BE GROSSLY INFLATED. THE LD. C.I.T.(A) THUS FO UND THE LD. A.O.S ASSERTION ABOUT UNEXPLAINED INVESTMENTS IN THOSE IMMOVABLE PROPERTI ES TO BE INCORRECT AND, ACCORDINGLY, HELD THE ADDITION OF RS.36 LAKHS MADE ON SUCH ACCOU NT TO BE UNJUSTIFIED. FROM THE ABOVE, WE OBSERVE THAT THE LD. C.I.T.(A) HIMSELF HAS NOT T OTALLY RELIED ON THE VALUE OF SUCH PROPERTIES AT RS.36 LAKHS SHOWN IN THE PROCESS NOTE BY CONSIDERING THE SAME TO BE GROSSLY INFLATED. CONSIDERING THE ABOVE, WE FIND N O INFIRMITY IN ARRIVING AT SUCH A CONCLUSION BY THE LD. C.I.T.(A), WHICH IS UPHELD. 10 12.1. WE FURTHER OBSERVE THAT THE LD. C.I.T.(A) MA DE AN AD HOC ADDITION OF RS. 10 LAKHS BY CONSIDERING THE FACT THAT IN THE PROCESS NOTE IS SUED BY THE BANK FOR GRANTING C.C. LOAN THE ASSESSEE DECLARED TRADING IN POTATO, JUTE & JUT E BAGS AND THE NET PROFIT EARNED FROM SUCH BUSINESS WAS AT RS.3,81,000/-, WHICH REMAINED UNDISCLOSED IN THE RETURN FILED FOR THE ASSESSMENT YEAR UNDER CONSIDERATION. HE, THEREF ORE, CONSIDERING THE NET PROFIT SHOWN BY THE ASSESSEE ESTIMATED THE TURNOVER AT RS. 19,05,000/- AND UNEXPLAINED INVESTMENT FOR SUCH BUSINESS AT RS.10 LAKHS AND DIR ECTED THE LD. A.O. TO RESTRICT THE ADDITION TO RS.10 LAKHS INSTEAD OF RS.36 LAKHS. ON THE FACTS OF THE CASE, IN OUR CONSIDERED OPINION, MERE MENTIONING OF BUSINESS ACT IVITY IN THE PROCESS NOTE OF THE BANK WAS FOR ALTOGETHER DIFFERENT PURPOSES AND IT HAS NO CONNECTION WITH TAX ANGLE, BECAUSE THE SAID INFORMATION WAS GIVEN ONLY TO MEET THE BAN KS REQUIREMENT TO FACILITATE GRANTING OF C.C. LOAN. BUT IT DOES NOT MEAN THAT THE SAID I NFORMATION CAN BE MADE BASIS FOR ADDITION WITHOUT ANY FURTHER MATERIAL TO PROVE THAT THERE WAS ACTUALLY ANY SUCH BUSINESS WITH SUCH PROFITS. THE INFORMATION GIVEN BY THE AS SESSEE IN THE PROCESS NOTE OF THE BANK COULD NOT BE ACCEPTED AS THE ULTIMATE TRUTH. IT IS PERTINENT TO MENTION HERE THAT THE LD. C.I.T.(A) WHILE DELETING THE ADDITION OF RS.36 LAKH S WITH RESPECT TO VALUE OF IMMOVABLE PROPERTIES, DEALT BY US IN THE IMMEDIATELY PRECEDIN G PARAGRAPH, CLEARLY HELD THAT THE VALUE OF IMMOVABLE PROPERTIES SHOWN BY THE ASSESSEE IN THE PROCESS NOTE WAS GROSSLY INFLATED AND HE ACCEPTED THE CONTENTION OF THE ASSE SSEE BY HOLDING THAT THE ADDITION MADE BY THE LD. A.O. ON THIS COUNT IS NOT MAINTAINA BLE. HOWEVER, THE LD. C.I.T.(A) HAS RESORTED TO AN AD HOC ADDITION OF RS.10 LAKHS RELYI NG ON THE SAME VERY PROCESS NOTE, THE VERACITY OF WHICH HE HIMSELF HAS DISBELIEVED. IN O UR OPINION, SUCH AN ACTION HAS NO LEGAL SANCTITY. IN THIS CONNECTION, WE MAY REFER TO THE LAW LAID DOWN BY THE HONBLE SUPREME COURT IN THE CASE OF DHIRAJLALA GIRDHARILAL VS. CIT (SUPRA), WHEREIN IT HAS BEEN HELD AS UNDER :- WHEN A COURT OF FACT ACTS ON MATERIAL, PARTLY RELEV ANT AND PARTLY IRRELEVANT, IT IS IMPOSSIBLE TO SAY TO WHAT EXTENT THE MIND OF THE CO URT WAS AFFECTED BY THE IRRELEVANT MATERIAL USED BY IT IN ARRIVING AT ITS F INDING. SUCH A FINDING IS VITIATED BECAUSE OF THE USE OF INADMISSIBLE MATERIAL IN FACT, THE PRESENT CASE IS FAR BETTER THAN ONE RE FERRED TO ABOVE. IN THE CASE OF THE ASSESSEE, THE PROCESS NOTE RELIED ON BY THE LD. A.O . AS A VALID DOCUMENT FOR THE PURPOSE 11 OF ASSESSMENT HAD TOTALLY DISBELIEVED BY THE LD. C. I.T.(A) HIMSELF WHILE ADJUDICATING THE ISSUE OF IMMOVABLE PROPERTIES WORTH RS.36 LAKHS. T HEREFORE, TO SUSTAIN AN ADDITION ON A DIFFERENT ASPECT OF RS.10 LAKHS RELYING ON THAT PAR TICULAR DOCUMENT (PROCESS NOTE) IS WITHOUT ANY BASIS AND CANNOT BE ENDORSED. BESIDES ABOVE, THE ACTION OF THE LD. C.I.T.(A) ON THIS ISSUE ON THE BASIS OF SURMISE AND CONJECTURE CANNOT ALSO BE SUSTAINED. AS STATED ABOVE, THE LD. C.I.T.(A) CONSIDERING THE DECLARATION OF THE ASSESSEE IN THE PROCESS NOTE ABOUT HIS RUNNING OF POTATO, JUTE & JUTE BAGS BUSINESS AND NET PROFIT OF RS.3,81,000/- THEREON PRESUMED AND ESTIMATED THE TURNOVER AT RS.19,05,000/- AND UNEXPLAINED INVESTME NT FOR SUCH BUSINESS AT RS.10 LAKHS, WHICH HE ADDED. IT WAS ONLY ONE SIDE OF THE ISSUE. AN EQUALLY POSSIBLE VIEW, AS CLAIMED BY THE ASSESSEE, COULD BE THAT THE ASSESSEE TO OBTAIN C.C. LOAN FALSELY INTIMATED ABOUT HIS BUSINESS AND PROFIT THEREON WHICH WAS ACTUALLY NON- EXISTENT. THEREFORE, IT IS APPARENT THAT THE LD. C.I.T.(A) HAS NOT ACTED JUDICIALLY BUT UPON ONE SIDED CONJECTURES AND SURMISES WITHOUT ANY SUPPORTING EVIDENCE OF EXISTENCE OF BUS INESS AND PROFIT EARNED FROM SUCH BUSINESS, EXCEPT THE CONTENTS OF PROCESS NOTE OF TH E BANK, WHICH HE HIMSELF HELD TO BE GROSSLY INFLATED WHILE DEALING WITH VALUE OF IMMOVA BLE PROPERTIES. IT IS ALSO AN ESTABLISHED POSITION THAT SUSPICION WHATEVER MAY BE STRONG CANN OT PARTAKE THE CHARACTER OF EVIDENCE UNLESS THE SAME IS CORROBORATED BY EVIDENCE. FOR O UR ABOVE CONCLUSION, WE DERIVE SUPPORT FROM THE CASE OF ACIT VS. MANGALAM PUBLICATION (SUP RA). CONSIDERING THE TOTALITY OF THE FACTS AND CIRCUMSTANCES OF THE CASE AND THE DECISIO NS CITED SUPRA, WE HOLD THAT THE LD. C.I.T.(A) HAS WRONGLY MADE ADDITION OF RS.10 LAKHS ALLEGING UNEXPLAINED INVESTMENT. SAME IS DELETED. THEREFORE, GROUND NO. 2 IN REVENUES A PPEAL IS DISMISSED AND GROUNDS NO. 3 & 4 OF THE ASSESSEES APPEAL AS WELL AS IN CROSS-OBJE CTION ARE ALLOWED. 13. THE NEXT ISSUE (4) ABOVE IS ON ACCOUNT OF ADDI TION OF RS.3,81,000/- BEING NET PROFIT FROM UNDISCLOSED BUSINESS OF POTATO, JUTE & JUTE BAGS, WHICH HAS BEEN AGITATED IN GROUND NO. 5 IN THE ASSESSEES APPEAL AND CROSS-OBJ ECTION. IN THE IMMEDIATELY PRECEDING PARAGRAPH WHILE ADJUDICATING UPON THE AD HOC ADDITI ON OF RS.10 LAKHS BASED ON NET PROFIT OF RS.3,81,000/- FROM POTATO, JUTE & JUTE BAG BUSIN ESS, WE HAVE ALREADY DELETED THE ADDITION MADE AS UNEXPLAINED INVESTMENT. THAT BEIN G SO, FOR THE REASONS MENTIONED ON 12 THAT ISSUE, THE ADDITION OF RS.3,81,000/- DOES NOT SURVIVE, WHICH IS DELETED. GROUND NO.5 BOTH IN ASSESSEES APPEAL AND CROSS OBJECTION IS AL LOWED. 14. THE NEXT ISSUE (5) ABOVE IS WITH REGARD TO ADD ITION OF RS.1,50,000/- AS UNEXPLAINED DEPOSITS IN UCO BANK, WHICH IS AGITATED BY THE ASSESSEE VIDE GROUND NO. 6 OF HIS APPEAL AND CROSS-OBJECTION. THE LD. A.O. OBSERV ED THAT THE ASSESSEE MADE CASH DEPOSITS IN UCO BANK OF RS.30,000/- ON 0O8/3/2005 A ND RS.1,20,000/- ON 14/3/2005. FOR ASSESSEES FAILURE TO EXPLAIN SUCH DEPOSITS, TH E LD. A.O. ADDED THE SUM OF RS.1,50,000/- AS UNEXPLAINED MONEY. THE ADDITION W AS UPHELD BY THE LD. C.I.T.(A). 15. AT THE TIME OF HEARING BEFORE US, THE LD. DEPA RTMENTAL REPRESENTATIVE RELYING ON THE ORDERS OF THE AUTHORITIES BELOW JUSTIFIED THE A DDITION. ON THE OTHER HAND, THE LD. COUNSEL SUBMITTED THAT THE MAJOR PART OF THE COMMIS SION INCOME OF THE ASSESSEE FROM LIC AND NICO WAS DEPOSITED IN HIS PARTNERSHIP BUSIN ESS. THE ASSESSEE WITHDREW CASH OF RS.30,000/- ON 08/3/2005 AND FURTHER SUM OF RS.1,20 ,000/- ON 14/3/2005 FROM THE PARTNERSHIP FIRM AND DEPOSITED THE SAME IN HIS ACCO UNT WITH UCO BANK ON THE RESPECTIVE DATES. AS THE PURPOSE OF WITHDRAWAL DID NOT MATERIA LIZE, THE ASSESSEE REFUNDED BACK THE ENTIRE MONEY TO THE PARTNERSHIP FIRM BY WITHDRAWING CASH FROM HIS BANK ACCOUNT ON 15/3/2005. ACCORDING TO HIM FURTHER, THE ABOVE POS ITION WOULD BE EVIDENT FROM THE BOOKS OF THE FIRM AS WELL AS THE ASSESSEE. HE, THE REFORE, SUBMITTED THAT THE SAID CASH OF RS.1,50,000 WAS NOT ASSESSEES UNEXPLAINED MONEY AND THE ADDITION SHOULD BE DELETED. 16. WE OBSERVE THAT IN THE ASSESSMENT ORDER AS AL SO IN THE APPELLATE ORDER, THE MATTER HAS NOT BEEN DEALT WITH ON THE FACTS AS ADVA NCED BEFORE US BY THE LEARNED COUNSEL, ALTHOUGH IN THE WRITTEN SUBMISSION EXTRACT ED ON PAGE-17 OF THE APPELLATE ORDER THE AFORESAID EXPLANATION OF THE ASSESSEE HAS BEEN INCORPORATED. CONSIDERING THE ABOVE, IN OUR CONSIDERED OPINION, IT WOULD BE IN THE FITNE SS OF THING IF THE MATTER IS RESTORED TO THE FILE OF THE LD. A.O. FOR FRESH ADJUDICATION. WE , THEREFORE, SET ASIDE THE ORDERS OF THE AUTHORITIES BELOW ON THIS ISSUE AND SEND THE MA TTER BACK TO THE FILE OF THE A.O. FOR VERIFICATION OF THE FACTS AND RECORDS AS SUBMITTED BY THE LEARNED COUNSEL. THE LD. A.O. SHALL AFFORD REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE TO SUBSTANTIATE HIS CLAIM WITH DOCUMENTARY EVIDENCE. GROUND NO. 6 OF A SSESSEES APPEAL & CROSS OBJECTION IS ALLOWED FOR STATISTICAL PURPOSES. 13 17. THE ONLY OTHER DISPUTE VIDE ISSUE (6) ABOVE IS WITH REGARD TO ADDITION OF RS.30,000/- MADE ON ACCOUNT OF BOGUS GIFT FROM ASSE SSEES MOTHER. THE SAID ADDITION HAS BEEN AGITATED VIDE GROUND NO.7 OF THE ASSESSEE S APPEAL AS WELL AS CROSS-OBJECTION. THE LD. A.O. IN ABSENCE OF ANY SATISFACTORY EXPLANA TION DISBELIEVED THE GIFT AND ADDED THE SAME TO HIS TOTAL INCOME, WHICH WAS UPHELD BY T HE LD. C.I.T.(A). 18. THE LD. COUNSEL SUBMITTED THAT THE ASSESSEE FI LED AN AFFIDAVIT FROM HIS MOTHER CONFIRMING THE GIFT OF RS.30,000/- MADE BY HER. TH E LD. COUNSEL FURTHER SUBMITTED THAT THE A.O. DID NOT VERIFY THE GIFT FROM THE DONOR. I T WAS FURTHER SUBMITTED THAT THE DONOR RECEIVED A SUM OF RS.50,000/- FROM HER BROTHE R AS HER SHARE OF SALE PROCEEDS OF HER PATERNAL PROPERTY, OUT OF WHICH THE AFORESAID G IFT WAS MADE TO HER SON. THE LD. A.O. WITHOUT VERIFICATION OF THESE FACTS ARBITRARILY DIS BELIEVED THE GIFT, WHICH IS UNJUST. 19. WE OBSERVE THAT IN THE ASSESSMENT ORDER AS AL SO IN THE APPELLATE ORDER, THE MATTER HAS NOT BEEN DEALT WITH ON THE FACTS AS ADVA NCED BEFORE US BY THE LEARNED COUNSEL, ALTHOUGH IN THE WRITTEN SUBMISSION EXTRACT ED ON PAGE-18 OF THE APPELLATE ORDER THE AFORESAID EXPLANATION OF THE ASSESSEE HAS BEEN INCORPORATED. CONSIDERING THE ABOVE, IN OUR CONSIDERED OPINION, IT WOULD BE IN THE FITNE SS OF THING IF THE MATTER IS RESTORED TO THE FILE OF THE LD. A.O. FOR FRESH ADJUDICATION. WE , THEREFORE, SET ASIDE THE ORDERS OF THE AUTHORITIES BELOW ON THIS ISSUE AND SEND THE MA TTER BACK TO THE FILE OF THE A.O. FOR VERIFICATION OF THE FACTS AND RECORDS AS SUBMITTED BY THE LEARNED COUNSEL. THE LD. A.O. SHALL AFFORD REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE TO SUBSTANTIATE HIS CLAIM OF RECEIPT OF GIFT FROM HIS MOTHER WITH DOCUM ENTARY EVIDENCE. GROUND NO. 7 OF ASSESSEES APPEAL & CROSS OBJECTION IS ALLOWED FOR STATISTICAL PURPOSES. 20. THE DEPARTMENT HAS ALSO TAKEN A GROUND THAT TH E LD. C.I.T.(A) IN VIOLATION OF RULE 46A OF THE RULES HAS ADMITTED FRESH EVIDENCE WITHOU T GIVING ANY OPPORTUNITY TO THE LD. A.O. WE OBSERVE FROM PAGE-3 OF THE ASSESSMENT ORDE R THAT THE LD. A.O. GOT THE MATTER OF C.C. LOAN AND OTHER DOCUMENTS FOR OBTAINING SUCH LOAN VERIFIED FROM UCO BANK, SAHAPUR BRANCH, HOOGHLY THOUGH HIS INSPECTOR WHO HAS CONFIR MED OF ADVANCING SUCH C.C. LOAN WITH THE DOCUMENTS MORTGAGED BY THE ASSESSEE FOR SUCH LO AN. THE LD. C.I.T.(A) ALSO HAS CONSIDERED THE SAME INFORMATION AND EVIDENCES WHICH WERE OBTAINED FROM THE BANK AND CONSIDERED BY THE LD. A.O. HIMSELF. FURTHER AT THE TIME OF HEARING ALSO, THE LD. 14 DEPARTMENTAL REPRESENTATIVE COULD NOT SPECIFY ANY S UCH DOCUMENT WHICH REMAINED UNVERIFIED BY THE LD. A.O. BUT CONSIDERED FOR THE F IRST TIME BY THE LD. C.I.T.(A). IN THAT VIEW OF THE MATTER, WE FIND NO MERIT IN THIS GROUND OF THE DEPARTMENT, WHICH IS DISMISSED. 21. IN THE RESULT, THE APPEAL OF THE DEPARTMENT IS DISMISSED AND THE APPEAL AS WELL AS CROSS-OBJECTION OF THE ASSESSEE IS DEEMED TO BE ALL OWED FOR STATISTICAL PURPOSES. SD/- SD/- , % % % % . .. . ! ! ! !. .. . , , , , '# '# '# '# , ( N.VIJAYAKUMARAN, JUDICIAL MEMBER) ( C.D.RAO, ACCOUNTANT MEMBER) ( (( (!# !# !# !#) )) ) DATE: 29 -12-2011 '6 4 /%% 7''8- COPY OF THE ORDER FORWARDED TO : 1. +, / THE APPELLANT : I.T.O., WARD-1(1), HOOGHLY 2 /0+, / THE RESPONDENT : PRADYUT KR. DAS, VILL. SANTOSH PUR, PO & PS- TARAKESWAR HOOGHLY -712 410. 3. %6 () : THE CIT(A)-XXXVI, KOLKATA. 4. %6/ THE CIT, KOL- 5 . <%= /% / DR, ITAT, KOLKATA BENCHES, KOLKATA 6 . GUARD FILE . 0 /%/ TRUE COPY, '6/ BY ORDER, (DKP) > / DY/ASSTT. REGISTRAR .