Nirmal S. Jain, Pune V. Deputy Commissioner of Income-tax,

ITA 2116/PUN/2014

• Counselvise Citation: [2017] 126 COUNSELVISE.COM (IT) 7322 (ITAT-PUNE)
• Duration Of Justice: 2 year(s) 10 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-10-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 12-10-2017
• Assessment Year: 2005-2006
• Appeal Filed On: 25-11-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Unexplained investment; Business income; Search and seizure; Document seized; Documents seized
• Section: 143(3); 153A; 10; 2

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH A , PUNE , , BEFORE MS. SUSHMA CHOWLA, JM AND SHRI ANIL CHATURVEDI, AM . / ITA NO S . 2116 & 2117 /P U N/20 1 4 / ASSESSMENT YEAR S : 20 0 5 - 06 & 2006 - 07 NIRMAL S. JAIN, 16/A, HIMALAYA ESTATE, SHIVAJI NAGAR, PUNE - 4110 05 . / APPELLANT PAN:A AOPJ0816D VS. THE DY. COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE 2(2), PUNE . / RESPONDENT . / ITA NO. 2243 /P U N/20 14 / ASSESSMENT YEAR : 2005 - 06 THE ASST. COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE 2(2), PUNE . / APPELLANT VS. NIRMAL S. JAIN, 16/A, HIMALAYA ESTATE, SHIVAJI NAGAR, PUNE 411005 . / RESPONDENT PAN:AAOPJ0816D ASSESSEE BY : S HRI NIKHIL PATHAK REVENUE BY : S HRI RAJEEV KUMAR, CIT / DATE OF HEARING : 12 . 1 0.2017 / DATE OF PRONOUNCEMENT: 17 . 1 0.2017 2 ITA NO S . 2116 & 2117 /PUN/20 14 ITA NO.2241/PUN/2014 NIRMAL S. JAIN / ORDER PER SUSHMA CHOWLA, JM: OUT OF THIS BUNCH OF THREE APPEALS, CROSS APPEALS FILED BY THE ASSESSEE AND THE REVENUE AND ALSO THE APPEAL FILED BY THE ASSESSEE ARE AGAINST CONSOLIDATED ORDER OF CIT(A) - CENTRAL, PUNE , DATED 09 . 0 9 .201 4 RELATING TO ASSESSMENT YEAR S 2005 - 06 AND 2006 - 07 AGAINST RESPECTIVE ORDER S PASSED UNDER SECTION 153A(B) R.W.S. 143(3) OF THE INCOME TAX ACT 1961 (IN SHORT THE ACT). 2 . THIS BUNCH OF APPEALS RELATING TO THE SAME ASSESSEE WERE HEARD TOGETHER AND ARE BEING DISPOSED OF BY THIS CONSOLIDATED ORDER FOR THE SAKE OF CONVENIENCE. THE ASSESSEE AND THE REVENUE HAVE FILED THE CROSS APPEALS RELATING TO THE ORDER PASSED IN ASSESSMENT YEAR 2005 - 06. FURTHER, THE ASSESSEE IS IN APPEAL RELATING TO ASSESSMENT YEAR 2006 - 07. 3. FIRST, WE SHALL TAKE UP THE CROSS APPEALS FILED BY THE ASSESSEE AND THE REVENUE, WHERE THE ISSUE IS INTERLINKED, WHEREIN THE ASSESSING OFFICER HAD MADE THE ADDITION OF RS.1,10,00,000/ - ON ACCOUNT OF UNDISCLOSED INVESTMENTS IN M/S. SAAR PROPERTIES BASED ON SEIZED DOCUMENT FOUND AT THE RESIDENCE OF SHRI ASHOK JAIN. THE CIT(A) HOWEVER, CONFIRMED THE ADDITION TO THE EXTENT OF RS.22,50,000/ - AND HENCE, BOTH THE ASSESSEE A ND THE REVENUE ARE IN APPEAL BEFORE US. 4. THE ASSESSEE IN ITA NO.2116/PUN/2014 RELATING TO ASSESSMENT YEAR 2005 - 06 HAS RAISED THE FOLLOWING GROUNDS OF APPEAL: - ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW: 1 . THE CIT(A) ERRED IN CONFIRMING ADDITION TO THE EXTENT OF RS.22,50,000/ - OUT OF AN ADDITION OF RS.1,10,00,000/ - MADE IN THE ASST. ORDER, AS UNDISCLOSED 3 ITA NO S . 2116 & 2117 /PUN/20 14 ITA NO.2241/PUN/2014 NIRMAL S. JAIN INVESTMENT IN M/S. SAAR PROPERTIES BASED ON SEIZED DOCUMENT (PAGE NO.9 BUNDLE NO.1) FOUND AT THE RESIDENC E OF SHRI ASHOK JAIN. THE APPELLANT PLEADS THAT THE AO AND CIT(A) FAILED TO APPRECIATE THAT THE SEIZED DOCUMENT CONTAINED PROJECTIONS AND DID NOT EVIDENCE ACTUAL TRANSACTIONS AND WAS INSUFFICIENT EVIDENCE TO JUSTIFY AN ADVERSE CONCLUSION. 2 . THE CIT(A) FAIL ED TO APPRECIATE THAT THE JOTTINGS IN THE SEIZED DOCUMENT NOT HAVING BEEN CORROBORATED BY ANY OTHER EVIDENCE OF UNDISCLOSED INVESTMENT IN M/S. SAAR PROPERTIES FOUND WITH THE ASSESSEE, COULD NOT HAVE BINDING EFFECT ON THE APPELLANTS CASE. 3 . THE AO'S CONCLUS ION IS BASED ON ERRONEOUS BELIEF, SUSPICION AND CONJECTURE AND NOT ON ACTUAL PROOF OF UNDISCLOSED INVESTMENTS MADE BY THE APPELLANT. THE APPELLANT PLEADS THAT THE CIT(A) ERRED IN CONFIRMING THE AO'S INVALID CONCLUSION. 5. THE REVENUE IN ITA NO.2243/PUN/2 014, RELATING TO ASSESSMENT YEAR 2005 - 06 HAS RAISED THE FOLLOWING GROUNDS OF APPEAL: - 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) WAS NOT JUSTIFIED IN RESTRICTING THE ADDITION MADE BY THE A.O. AMOUNTING TO RS.1,10,00,000/ - TO RS.22,50,000/ - THEREBY IGNORING THE INCRIMINATING DOCUMENTS FOUND DURING THE COURSE OF THE SEARCH PROCEEDINGS. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) WAS NOT JUSTIFIED IN RESTRICTING THE ADDITION MADE BY THE A.O. AMOUNTING TO RS.1,10,00,000/ - TO RS.22,50,000/ - AS FROM THE SEIZED DOCUMENTS IT CANNOT BE SAID THAT THE AMOUNT OF RS.25 LACS HAD ALREADY BEEN REFUNDED BACK TO THE ASSESSEE BY M/S. SAAR PROPERTIES BEFORE THE SEARCH ACTION. ACCORDINGLY, THE LD. CIT(A) SHOULD HAVE RESTR ICTED THE ADDITION AT LEAST TO RS.47,50,000/ - . 3. THE ORDER OF LD. CIT(A) MAY BE VACATED AND THAT OF THE ASSESSING OFFICER BE RESTORED. 6. BRIEFLY, IN THE FACTS OF THE CASE, SEARCH AND SEIZURE ACTION WAS CONDUCTED ON 27.04.2005 AT THE RESIDENTIAL PREMISES OF THE ASSESSEE. THE ASSESSEE WAS PARTNER IN DIFFERENT CONCERNS AND DURING THE COURSE OF SEARCH, CERTAIN VALUABLES AND PAPERS/DOCUMENTS WE RE FOUND, WHICH AS PER THE ASSESSING OFFICER, HAVE BEEN CONSIDERED IN THE RESPECTIVE ASSESSMENT YEAR/S. NOTICE UNDER SECTION 153A OF THE ACT WAS ISSUED TO THE ASSESSEE. IN RESPONSE THERETO, THE ASSESSEE FILED THE RETURN OF INCOME DECLARING TOTAL INCOME O F RS.42,76,370/ - WHICH CONSISTED OF BUSINESS INCOME AND INCOME FROM CAPITAL GAINS INCLUDING INCOME FROM OTHER SOURCES . DIFFERENT ADDITIONS WERE MADE IN THE HANDS OF ASSESSEE. 4 ITA NO S . 2116 & 2117 /PUN/20 14 ITA NO.2241/PUN/2014 NIRMAL S. JAIN HOWEVER, THE ISSUE WHICH IS RELEVANT FOR DECIDING THE PRESENT CROSS APPEALS IS THE ADDITION MADE ON ACCOUNT OF CAPITAL INTRODUCTION OF RS.1.10 CRORES. THE ASSESSING OFFICER NOTES VIDE PARA 7 OF THE ASSESSMENT ORDER THAT DURING THE COURSE OF SEARCH ACTION AT THE RESIDENCE OF SHRI ASHOK JAIN, ONE OF THE DOCUMENTS I.E. PAGE NO.9 OF BUNDLE NO.1 SHOWS THAT SHRI NIRMAL SHANTILAL JAIN I.E. THE ASSESSEE HAD ALSO INTRODUCED RS.1.10 CRORES. THE ASSESSING OFFICER DREW STRENGTH FROM THE FACT THAT THE OTHER ENTRIES AP PEARING ON THE PAGE WERE TRUE , LIKE , LOAN FROM BORA, CONTRIBUTIONS AS ON THE DATE BY SHRI ASHOK JAIN, NANAWARE AND TOTAL EXPENDITURE OF SAAR AT RS.1.30 CRORES AS ON THE DATE. THE ASSESSEE WAS ASKED TO EXPLAIN AS TO WHY THE SAID SUM OF RS.1.10 CRORES BEING INTRODUCTION OF CAPITAL SHOULD NOT BE ADDED IN THE HANDS OF ASSESSEE AS UNDISCLOSED INVESTMENTS. THE ASSESSEE IN TURN, FILED WRITTEN SUBMISSIONS WHICH ARE REPRODUCED UNDER PARA 7 AT PAGES 4 AND 5 OF THE ASSESSMENT ORDER. THE ASSESSEE EXPLAINED THAT THE SAID DOCUMENT WAS SEIZED AT THE RESIDENCE OF HIS BROTHER AND NO SUCH DOCUMENT OR ANY OTHER DOCUMENT CONFIRMING THE SAID ENTRY WAS FOUND FROM THE RESIDENCE OF ASSESSEE OR HIS BUSINESS PREMISES. THE ASSESSEE FURTHER STRESSED THAT NONE OF THE JOTTINGS THEREI N PERTAINING TO HIS FINANCIAL TRANSACTIONS. HE EXPLAINED THAT HE HAD ADVANCED SUM OF RS.87,50,000/ - TO M/S. SAAR PROPERTIES BEFORE THE DATE OF SEARCH, OUT OF WHICH, RS.25 LAKHS WAS RETURNED BY CHEQUE ON 19.04.2005. THE ASSESSEE EXPLAINED THAT THESE ENTRI ES WERE DISCLOSED BOTH IN THE BOOKS OF ASSESSEE AS WELL AS IN M/S. SAAR PROPERTIES. HE STRESSED THAT HE HAD NOT ADVANCED ANY AMOUNT IN CASH TO M/S. SAAR PROPERTIES OR TO SHRI ASHOK JAIN. HE FURTHER POINTED OUT THAT THE SAID DOCUMENT WAS A JOTTING MADE BY SHRI ASHOK JAIN I.E. OUTLINING LEGAL FORMALITIES REQUIRED TO BE DONE IN CONNECTION WITH THE ACTIVITIES OF M/S. SAAR PROPERTIES . HE FURTHER REFERRED TO THE STATEMENT ON OATH RECORDED OF SHRI ASHOK JAIN, WHEREIN IN ANSWER TO QUESTION NO.4, HE HAS POINTED O UT THAT THE JOTTINGS IN FIGURES WERE 5 ITA NO S . 2116 & 2117 /PUN/20 14 ITA NO.2241/PUN/2014 NIRMAL S. JAIN ESTIMATED CONTRIBUTIONS OF PARTNERS AND FAMILY MEMBERS IN CONNECTION WITH THE BUSINESS OF M/S. SAAR PROPERTIES. FURTHER, THE TRANSACTIONS OF M/S. SAAR PROPERTIES INCLUDING BOTH CASH AND CHEQUE PAYMENTS WERE SUMMARIZED AT PAGES 10, 11 AND 12 OF BUNDLE NO.1 AND THE TOTAL CONSIDERATION FOR PURCHASE OF LAND COMPRISING OF BOTH CASH AND DISCLOSED CONSIDERATION TOTALED RS.92,10,000/ - . THE FIGURES JOTTED AGAINST THE INITIAL NSJ 110 AT PAGE NO.9 WE RE NOT MENTIONED IN THE SAID SUMMARIES AND HENCE, THE SAID FIGURES WERE NOT REAL FIGURES. THE ASSESSING OFFICER REJECTED THE PLEA OF ASSESSEE SINCE PART OF ENTRIES WERE TALLYING WITH THE BOOKS OF ACCOUNT OF ASSESSEE AND HENCE, IT COULD NOT BE PRESUMED THA T THE PART OF PAPERS WERE ONLY ESTIMATION. THE ASSESSING OFFICER MADE AN ADDITION OF RS.1.10 CRORES AS UNEXPLAINED INVESTMENT OF THE ASSESSEE. 7. THE CIT(A) HOWEVER, NOTED THAT THE DOCUMENT WAS NOT IN THE HANDWRITING OF THE ASSESSEE AND WAS ALSO NO T FO UND AT THE RESIDENCE OF ASSESSEE. IT IS ALSO FINDING OF THE CIT(A) THAT THE FACTS ON RECORD DO NOT REVEAL THAT ANY OTHER CORROBORATING EVIDENCE WAS FOUND AT THE RESIDENCE OF THE ASSESSEE. HE HOWEVER, NOTED THAT NEITHER SHRI ASHOK JAIN NOR THE ASSESSEE HA D COMPLETELY DIS CREDITED THE DOCUMENT AS MEANINGLESS SCRIBBLING. THE CIT(A) FURTHER OBSERVED THAT NOT ONLY THE PERSONS REFERRED THEREIN WERE REAL AND EXISTING BUT SOME OF THE FINANCIAL TRANSACTIONS WERE ALSO ACCEPTED AS GENUINE. THE CIT(A) FURTHER NOTED THAT THOUGH THE ASSESSEE CLAIMS THAT WHY HE WOULD INTRODUCE RS.1.10 CRORES IN THE ENTITY, WHERE HE WAS NOT EVEN A PARTNER , HOWEVER, HE HAD ADVANCED RS.87,50,000/ - TO THE SAME ENTITY BY CHEQUE. IN VIEW THEREOF, THE CIT(A) OBSERVED THAT THE EVIDENTIARY VALU E OF DOCUMENT WA S ESTABLISHED THAT THE ENTRY 110 REFERS TO RS.1.10 CRORES. HE ALSO ACKNOWLEDGED THAT THE DOCUMENT DOES NOT BEAR DATE AND THERE WAS NOTHING IN THE DOCUMENT TO INDICATE THAT THE AMOUNTS MENTIONED OVER AND ABOVE THE AMOUNT OF RS.87,50,000/ - C LAIMED TO 6 ITA NO S . 2116 & 2117 /PUN/20 14 ITA NO.2241/PUN/2014 NIRMAL S. JAIN HAVE BEEN ADVANCED IN CHEQUE WERE DULY ACCOUNTED FOR. HE THUS, CONFIRMED THE ADDITION OF RS. 22,50,000/ - . 8. BOTH THE ASSESSEE AND THE REVENUE ARE IN APPEAL AGAINST THE ORDER OF CIT(A). 9. THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE POINTED OUT THAT THE ASSESSEE WAS NOT PARTNER IN M/S. SAAR PROPERTIES WHICH CONSIST ED OF THREE PARTNERS SHRI ASHOK JAIN, BROTHER OF ASSESSEE, S.E. NANAWARE AND RANJIT PISAL. HE FURTHER REFERRED TO THE DOCUMENTS WHICH WERE SEIZED FROM THE RESIDENCE OF SHRI ASHOK JAIN, WHICH RELATED TO M/S. SAAR PROPERTIES, WHEREIN FOUR PAPERS WERE SEIZED AND FROM ONE OF THE PAPERS, THE ASSESSING OFFICER CONCLUDED THAT THE ASSESSEE HAS GIVEN LOAN TO M/S. SAAR PROPERTIES. OUR ATTENTION WAS DRAWN TO PAGES 11 TO 14 OF THE PAPE R BOOK AND IT WAS POINTED OUT THAT ENTRIES IN SEIZED DOCUMENTS WERE IN RELATION TO THE PURCHASE OF LAND AT KATRAJ FROM A.V. RANAK BY M/S. SAAR PROPERTIES, WHEREIN BOTH THE CHEQUE AND THE CASH PAYMENTS WERE MADE FOR PURCHASING THE PROPERTY. PAGE 13 OF THE PAPER BOOK DETAILS THE CHEQUE AND CASH PAYMENTS BEING MADE AND HE REFERRED TO THE STATEMENT OF SHRI ASHOK JAIN, WHO ADMITTED THAT THE TOTAL PAYMENTS MADE FOR PURCHASE OF SAID LAND WAS RS.92.10 LAKHS. HE REFERRED TO THE ASSESSMENT ORDER IN THE CASE OF SHRI ASHOK JAIN AND POINTED OUT THAT CASH PAYMENT OF RS.29.60 LAKHS (HIS SHARE) WAS ADDED IN HIS HANDS. HE FURTHER REFERRED TO THE NOTINGS IN PAGE 11 WHICH WAS CONFRONTED TO SHRI ASHOK JAIN , WHO IN HIS STATEMENT POINTED OUT THAT THESE WERE ESTIMATED FIGURES O F AMOUNT TO BE INVESTED AND LOANS TO BE TAKEN I.E. THESE WERE PROJECTED FIGURES. OUR ATTENTION WAS DRAWN TO DIFFERENT ENTRIES ON THE SAID DOCUMENT AND IT WAS POINTED OUT THAT IN FRONT OF NSJ, PRESUMED TO BE THE SHORT NAME OF ASSESSEE, FIGURE OF 110 WAS WR ITTEN ; IN FRONT OF ANOTHER ENTRY OF BORA, FIGURE OF 50 WAS 7 ITA NO S . 2116 & 2117 /PUN/20 14 ITA NO.2241/PUN/2014 NIRMAL S. JAIN WRITTEN AND SINCE HE GAVE LOAN OF RS.50 LAKHS TO M/S. SAAR PROPERTIES BY CHEQUE, FIGURE OF 110 WAS TAKEN TO BE RS.1.10 CRORES AND THE SAID ADDITION BY THE ASSESSING OFFICER IN THE HANDS OF ASSESSEE . THE ASSESSEE POINTED OUT THAT IT HAD GIVEN LOAN TO M/S. SAAR PROPERTIES OF RS.87.50 LAKHS I.E. BY CHEQUE AND THE CIT(A) PRESUMED THAT THE FIGURE OF 110 WAS CORRECT AND HE ALLOWED THE BENEFIT OF RS.87.50 LAKHS BUT ADDED THE BALANCE SUM OF RS.22.50 LAKHS. HE FURTHER REFERRED TO THE COPY OF ACCOUNT OF ASSESSEE IN THE BOOKS OF M/S. SAAR PROPERTIES, WHICH IS PLACED AT PAGE 22 OF THE PAPER BOOK AND POINTED OUT THAT CHEQUE AMOUNTS DIFFERED FROM THE FIGURES WRITTEN IN FRONT OF NSJ . HE FURTHER STRESSED THAT EXC EPT FOR FIGURE OF BORA OF 50, NONE OF THE FIGURES TALLIED, ALTHOUGH THE ASSESSING OFFICER SAYS THAT THE FIGURES TALLIED. HE STRESSED THAT THE NATURE OF ENTRIES ON SEIZED PAPERS HAD TO BE SEEN WHICH ENLISTS THE ACTS TO BE UNDERTAKEN FOR THE FORMATION OF FI RM AND THEREAFTER, ITS PURCHASE OF LAND. HE FURTHER REFERRED TO DIFFERENT ENTRIES ON THE SAID DOCUMENT AND POINTED OUT THAT IN FRONT OF SC N, FIGURE OF 200+500 IS WRITTEN, WHICH, IF CONVERTED WOULD AMOUNT TO RS.7 CRORES, BUT NO ADDITION HAS BEEN MADE ON THIS ACCOUNT. HE STRESSED THAT BUT FOR THE ADDITION ON ACCOUNT OF ENTRY OF 110, NO OTHER ADDITION HAS BEEN MADE IN THE HANDS OF SHRI ASHOK J AIN ALSO. WHERE, THERE WAS NO EVIDENCE TO PROVE THAT THE ASSESSEE HAD PAID RS.1.10 CRORES IN CASH AND NO OTHER ENTRY BEING APPLIED IN THE HANDS OF OTHER PERSON EXCEPT IN THE CASE OF BORA, WHO ADMITTED TO HAVE PAID RS.50 LAKHS BY CHEQUE, THERE IS NO MERIT IN MAKING ANY ADDITION IN THE HANDS OF ASSESSEE. HE FURTHER POINTED OUT THAT TOTAL TRANSACTION FOR THE PURCHASE OF LAND WAS RS.92.10 LAKHS, WHICH INCLUDED THE CASH COMPONENT AND IN CASE NSJ HAD PAID THE AMOUNT, THEN THE SAME SHOULD HAVE BEEN MENTIONED AT PAGE 13 I.E. SEIZED DOCUMENT FOUND FROM SHRI ASHOK JAIN. 8 ITA NO S . 2116 & 2117 /PUN/20 14 ITA NO.2241/PUN/2014 NIRMAL S. JAIN 10. THE LEARNED DEPARTMENTAL REPRESENTATIVE FOR THE REVENUE POINTED OUT THAT UNDER SECTION 132(4A) OF THE ACT, ENTRIES IN THE DOCUMENT ARE PRESUMED TO BELONG TO THE ASSESSEE AND THE ONUS WAS ON THE ASSESSEE TO PROVE ITS CASE, WHICH HE HAS NOT ESTABLISHED. HE FURTHER RELIED ON PAGE 8 OF THE ASSESSMENT ORDER TO STRESS THAT THE ADDITION IN TOTAL SHOULD BE MADE IN THE HANDS OF ASSESSEE. 11. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE RECORD. THE ADDITION OF RS.1.10 CRORES WAS MADE IN THE HANDS OF ASSESSEE BEING UNDISCLOSED INVESTMENTS IN M/S. SAAR PROPERTIES, WHICH IN TURN, IS BASED ON THE SEIZED DOCUMENT FOUND AND SEIZED AT THE RESIDENCE OF SHRI ASHOK JAIN I.E. BROTHER OF ASSESSEE. SEARCH AN D SEIZURE OPERATIONS WERE CARRIED OUT AT THE RESIDENTIAL AND BUSINESS PREMISES OF THE ASSESSEE ON 27.04.2005. THE ASSESSEE WAS PARTNER IN VARIOUS FIRMS . THE BROTHER OF ASSESSEE WAS A PARTNER IN M/S. SAAR PROPERTIES IN WHICH THE ASSESSEE WAS NOT A PARTNER . DURING THE COURSE OF SEARCH AT THE RESIDENCE OF SHRI ASHOK JAIN, FOUR DOCUMENTS WERE SEIZED WHICH ARE PLACED AT PAGES 11 TO 14 OF THE PAPER BOOK. THE FIRST DOCUMENT PLACED AT PAGE 9, BUNDLE NO.1, MAKES A MENTION OF SEVERAL ACTS TO BE DONE I.E. (I) OBTA IN SHOP ACT COPY, (II) PARTNERSHIP DEED REGISTRATION RECEIPT, (III) LAND RELATED PAPERS, (IV) ORIGINAL DEMARCATION, (V) PLAINT OF V.D. KULKARNI, (VI) COLOUR ZONING, (VII) SHOP ACT, (VIII) PAN NUMBERS. AFTER THAT, THERE ARE CERTAIN NOTINGS OF NUMBERS BEFOR E DIFFERENT ABBREVIATED NAMES WHICH ARE AS UNDER: - SCN - 200 + 500 ASJ - 190 + 1945 - (1500+310+100+35) NSJ - 30+35+25+20=110 BORA - 50 ASJ/VYSJ 125 - 115 SAAR - 130 BORA / JNA - 60 ASJ 62 SCN 8 ASJ B.NO.1 P.NO.1 9 ITA NO S . 2116 & 2117 /PUN/20 14 ITA NO.2241/PUN/2014 NIRMAL S. JAIN 12. THERE ARE VARIOUS NOTINGS IN THE CASE OF VARIOUS ENTITIES AND THE ASSESSEE HAS EXPLAINED THAT SOME OF NOTINGS ARE IN THE CASE OF PARTNERS OF THE SAID CONCERN ; BORA IS SEPARATE ENTITY, WHO HAD ADVANCED RS.50 LAKHS IN CHEQUE TO M/S. SAAR PROPERTIES. BOTH SC N AND ASJ ARE THE PARTNERS OF M/S. SAAR PROPERTIES. THE SAID DOCUMENT WAS CONFRONTED TO SHRI ASHOK JAIN, WHO POINTED OUT THAT THESE WERE PROJECTED FIGURES FOR MAKING INVESTMENTS IN PURCHASE OF LAND AT KATRAJ. THE NEXT DOCUMENT BEING 10, 11 AND 12 OF BUND LE NO.1 WHICH WAS SEIZED FROM THE PREMISES OF SHRI ASHOK JAIN CLEARLY NOTES THE INVESTMENT MADE BOTH IN CHEQUE AND CASH IN RESPECT OF LAND PURCHASED FROM A.V. RANADE . THE CASH COMPONENTS CONTRIBUTED BY THREE PERSONS WHO WERE THE PARTNERS HAVE BEEN ADDED I N THE RESPECTIVE HANDS. IN THE CASE OF SHRI ASHOK JAIN, ADDITION OF RS.29,60,000/ - HAS BEEN MADE. THE DOCUMENT AT PAGE 14 TALKS ABOUT THE TOTAL TRANSACTION IN RESPECT OF LAND AND ITS RELATED EXPENDITURE TOTALING RS.1.35 CRORES, WHICH THEN TALKS ABOUT THE CASH EXPENSES PAID BY SCN AND ASJ AND FURTHER CAPITAL OF SCN AND ASJ , ADMITTEDLY, NO OTHER ADDITION HAS BEEN MADE IN THE HANDS OF SHRI ASHOK JAIN OR SCN. HOWEVER, ADDITION HAS BEEN MADE IN THE HANDS OF ASSESSEE ON ACCOUNT OF NARRATION OF FIGURE OF 110. THE BASIS FOR ARRIVING AT THE FIGURE OF RS.1.10 CRORES AGAINST THE AS SESSEE IS THE ENTRY IN FRONT OF BORA AT 50, WHO ADMITTEDLY HAD PAID RS.50 LAKHS IN CHEQUE TO M/S. SAAR PROPERTIES. THE ASSESSEE HAD ALSO PAID RS.87.50 LAKHS BY DIFFERENT CHEQUES TO M/S. SAAR PROPERTIES, OUT OF WHICH SUM OF RS.25 LAKHS HAS BEEN RETURNED BY THE SAID CONCERN. HOWEVER, THE FIGURES OF CHEQUES DO NOT TALLY WITH THE FIGURES NOTED AT PAGE 9 OF BUNDLE NO.1 OF THE SEIZED DOCUMENT PLACED AT PAGE 11 OF THE PAPER BOOK. 13. THE QUESTION WHICH ARISES IS WHETHER ADDITION CAN BE MADE IN THE HANDS OF AS SESSEE ON ACCOUNT OF SUCH NOTINGS. THE FIRST ASPECT OF THE SAID SEIZED 10 ITA NO S . 2116 & 2117 /PUN/20 14 ITA NO.2241/PUN/2014 NIRMAL S. JAIN DOCUMENT IS THAT NO DATE IS MENTIONED ON THE SAID DOCUMENT, WHICH HAS BEEN ALSO NOTED BY THE CIT(A). IN THE ABSENCE OF ANY DATE ON THE SAID PAGE , AT BEST, THE SAME CAN BE ONLY SCRIBBL ING AND FURTHER WHAT IS THE SANCTITY OF MAKING THE ADDITION IN THIS YEAR, WHERE DIFFERENT FIGURES ARE MENTIONED. THE ASSESSEE HAS ALSO ADMITTEDLY, PAID CHEQUE IN TWO ACCOUNTING YEARS I.E. ONE ENDING MARCH, 2005 AND THE SECOND BY APRIL, 2005. THE ASSESSEE HAD ADVANCED SUM OF RS.62,50,000/ - BY THREE DIFFERENT CHEQUES UPTO 31.03.2005 I.E. RELATING TO ASSESSMENT YEAR 2005 - 06 AND IN THE NEXT YEAR, HAD PAID SUM OF RS.25 LAKHS WHICH WAS ALSO RETURNED BY THE SAID CONCERN M/S. SAAR PROPERTIES. THE SECOND ASPECT W HICH HAS TO BE NOTED THAT EXCEPT FOR NARRATION IN FRONT OF BORA OF 50, WHICH ADMITTEDLY, WAS PAID BY CHEQUE, NO OTHER ENTRY HAS BEEN USED AS BASIS FOR MAKING ANY ADDITION IN THE HANDS OF OTHER PERSONS, WHO ADMITTEDLY, WERE THE PARTNERS OF M/S. SAAR PROPERT IES AND HAD MADE INVESTMENT IN PURCHASE OF PROPERTY. THE THIRD ASPECT WHICH HAS TO BE KEPT IN MIND IS THE TOTAL INVESTMENT IN PURCHASE OF PROPERTY OF RS.92,10,000/ - , WHICH INCLUDED BOTH CASH AND CHEQUE COMPONENTS. AFTER INCLUSION OF RELATED EXPENDITURE, TOTAL INVESTMENT IS RS.1.35 CRORES , SUM OF RS.29,60,000/ - HAS ALREADY BEEN ADDED IN THE HANDS OF SHRI ASHOK JAIN ON ACCOUNT OF HIS CASH CONTRIBUTION THOUGH THE ENTRIES AT PAGE 9 IN FRONT OF HIS NAME WERE 190+1945=2135. IN THE ENTIRETY OF THE ABOVE SAID FA CTS AND CIRCUMSTANCES , WE ARE OF THE VIEW THAT THE SAID DOCUMENT WHICH BESIDE NOTING THE ACTS TO BE CARRIED OUT BY THE GROUP OF PERSONS RELATED TO M/S. SAAR PROPERTIES, HAD TALKED OF SOME PROJECTED FIGURES ; ON ACCOUNT OF SUCH PROJECTED FIGURES, NO ADDITION CAN BE MADE IN THE HANDS OF ASSESSEE. IN ANY CASE, THE ASSESSEE HAD ADVANCED SUM OF RS.87,50,000/ - BY CHEQUES AND THE BREAKUP OF CHEQUES DO NOT TALLY WITH THE BREAKUP OF 110 NOTED ON THE SAID DOCUMENTS. IN THE ENTIRETY OF THE ABOVE SAID FACTS AND CIRCUMSTANCES, WE DIRECT THE ASSESSING OFFICER TO DELETE THE ADDITION MADE IN THE HANDS OF ASSESSEE. CONSEQUENTLY, THE 11 ITA NO S . 2116 & 2117 /PUN/20 14 ITA NO.2241/PUN/2014 NIRMAL S. JAIN GROUNDS OF APPEAL RAISED BY THE ASSESSEE ARE ALLOWED AND THE GROUNDS OF APPEAL RAISED BY THE REVENUE ARE DISMISSED. 14. THE ASSESSEE IN RESPECT OF ASSESSMENT YEAR 2006 - 07 POINTED OUT THAT THE ONLY GROUND OF APPEAL RAISED BY IT IN RESPECT OF CASH FOUND DURING THE COURSE OF SEARCH, IS NOT PRESSED. HENCE, THE SAME IS DISMISSED AS NOT PRESSED. 1 5 . IN THE RESULT, APPEAL OF ASSESSEE IN ASSESSMENT YEAR 2005 - 06 IS ALLOWED, APPEAL OF REVENUE IN ASSESSMENT YEAR 2005 - 06 AND APPEAL OF ASSESSEE IN ASSESSMENT YEAR 2006 - 07 ARE DISMISSED. ORDER PRONOUNCED ON THIS 1 7 T H DAY OF OCTO BER , 201 7 . SD/ - SD/ - (ANIL CHATURVEDI) (SUSHMA CHOWLA) / ACCOUNTANT MEMBER / JUDICIAL MEMBER / PUNE ; DATED : 1 7 T H OCTO BER , 201 7 . G G C C V V S S R R / COPY OF THE ORDER IS FORWARDED TO : 1. / THE APPELLANT ; 2. / THE RESPONDENT; 3. ( ) / THE CIT (A) - CENTRAL , PUNE ; 4. THE C IT , CENTRAL , PUNE ; 5. , , / DR A , ITAT, PUNE; 6. / GUARD FILE. / BY ORDER , // TRUE COPY // / SR. PRIVATE SECRETARY , / ITAT, PUNE