KAUNTEY M. TANNA, MUMBAI V. ITO 25(3)(2), MUMBAI

ITA 2159/MUM/2013

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 0404 (ITAT-MUMBAI)
• Duration Of Justice: 4 year(s) 4 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-08-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 18-06-2015
• Assessment Year: 1995-1996
• Appeal Filed On: 18-03-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: FIROZE B ANDYARUJINA
• Keywords: Unexplained investment; Search and seizure; Loose papers; Condonation of delay
• Section: 143(3)

Judgement Text

KAUNTEY M. TANNA ITA NO. 2159/MUM/2013 1 IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, MUMBAI BEFORE SHRI G.S. PANNU , AM AND SHRI RAVISH SOOD, JM ./ I.T.A. NO. 2159/MUM/2013 ( / ASSESSMENT YEAR: 1995 - 96 ) MR. KAUNTEY M. TANNA 107/108, SUPER SHOPPING COMPLEX, BAJAJ CROSS ROAD, KANDIVALI (W), MUMBAI - 400067 / VS. ITO - 25(3)(2), MUMBAI ./ ./ PAN/GIR NO. AABPT4176H ( / APPELLANT ) : ( / RESPONDENT ) / APPELLANT BY : SHRI FIROZE B. ANDYARUJINA , A .R. / RESPONDENT BY : SHRI DURGA DUTT , D .R. / DATE OF HEARING : 23/05 /2017 / DATE OF PRONOUNCEMENT : 11 /08 /2017 KAUNTEY M. TANNA ITA NO. 2159/MUM/2013 2 / O R D E R PER RAVISH SOOD, JUDICIAL MEMBER T HE PRESENT APPEAL IS DIRECTED AGAINST THE ORDER PASSED BY THE CIT(A) - 35, MUMBAI, DATED 14. 1 2.2012 , WHICH IN ITSELF ARISES FROM THE ASSESSMENT FRAMED BY THE A.O U/S 143(3) R.W.S. 254 OF THE INCOME TAX ACT, 1961 (I N SHORT THE ACT), DATED 29/12/2008 . THE ASSESSEE ASSAILING THE ORDER OF THE CIT(A) HAD RAISED BEFORE US THE F OLLOWING GROUNDS OF APPEAL: - 1. ADDITION ON ACCOUNT OF ALLEGED UNEXPLAINED INVESTMENT RS. 5,08,870/ - (A) THE ID. CIT(A) ERRED IN CONFIRMING ALLEGED ADDITION OUT OF LOOSE PAPER BEI NG SEIZED MATERIAL WITHOUT APPREC IATING THAT WHEN THE OBSERVATION OF ASSESSING OFFICER IN REMAND REPORT STATES THAT THE SAID AMOUNT OF THE PARTIES COULD NOT BE CORRELATED WITH THE OTHER SEIZED MATERIAL TO ASCERTAIN WHETHER IT IS A CASE OF LOAN GIVEN OR TAKEN, THE CONFIRMATION OF ADDITION IS NOT JUSTIFIED WHEN THE APPELLANT HAS DISOWN ED THE SEIZED PAPER. (B) WITHOUT PREJUDICE TO THE ABOVE, THE FINDING IN THE ORIGINAL ASSESSMENT PROCEEDING AS GOOD AS AN EX - PARTE BASIS LOOSES IT COLOUR ON THE FACE OF REMAND REPORT HAVING PASSED WITH DULY ACCORDED OPPORTUNITY. THEREFORE, THE ORDER OF THE ID. CIT(A) IS PERVERSE AND THE SAME MAY BE VACATED. 2. LEVY OF PENAL INTERESTS THE APPELLANT, ON MERITS, DENIES HER LIABILITY TO PENAL INTEREST. 3. THE APPELLANT CRAVES LEAVE TO ADD, AMEND OR ALTER ALL OR ANY OF THE ABOVE GROUND OF APPEAL. 2. THE PRESENT APPEAL FILED BY THE ASSESSEE INVOLVES A DELAY OF A PERIOD OF 3 DAYS. THAT THE ASSESSEE HAD FILED BEFORE US AN APPLICATION DATED. 02.11.2015 SEEKING CONDONATION OF DELAY IN FILING OF THE PRESENT APPEAL. THAT AS STATED BY ASSESSEE APPLICANT, THOU GH THE APPEAL WAS LIABLE TO BE FILED BEFORE THE TRIBUNAL ON 15.03.2013, THE SAME HOWEVER COULD BE FILED ONLY AS ON 18.03.2013, WHICH THUS INVOLVED A DELAY OF A KAUNTEY M. TANNA ITA NO. 2159/MUM/2013 3 PERIOD OF 3 DAYS. THE ASSESSEE APPLICANT IN HIS AFORESAID APPLICATION HAD FAIRLY STATED THAT AS HE WAS DURING THE RELEVANT POINT OF TIME DUE TO A PERSONAL FAMILY DISPUTE , AWAY TO MANGALORE, THEREFORE, BY THE TIME HE CAME BACK TO MUMBAI AND RECEIVED THE ORDER OF THE CIT(A) THE PERIOD FOR FILING OF THE APPEAL HAD ALREADY EXPIRED. THE ASSESSEE IN HIS AFORESAID APPLICATION SEEKING CONDONATION OF DELAY OF 3 DAYS HAD RELIED ON THE JUDGMENT OF THE HONBLE SUPREME COURT IN THE CASE OF : COLLECTOR OF LAND ACQUISITION VS. MST. KATI J I & ORS. (1987) 167 ITR 471. 3. W E HAVE PERUSED THE APPLI CATION FILED BY THE ASSESSEE SEEKING CONDONATION OF DELAY OF 3 DAYS INVOLVED IN FILING OF T HE PRESENT APPEAL. WE FIND THAT THE DELAY OF 3 DAYS IN FILING OF THE PRESENT APPEAL BY THE ASSESSEE WAS PROMPTED BY REASONS WHICH WERE BEYOND HIS CONTROL, AND COULD NOT BE ATTRIBUTED TO ANY LAPSES OR LACHES ON HIS PART. WE THUS IN THE BACKDROP OF THE AFORESAID FACTS AND KEEPING IN VIEW THE SHORT PERIOD OF DELAY INVOLVED IN FILING OF THE PRESENT APPEAL BY THE AS S ESSE E , THUS CONDONE THE SAME . 4 . TH E ASSESSEE IS IN HIS THIRD ROUND OF LITIGATION BEFORE THE TRIBUNAL. BRIEFLY STATED, T HE FACTS OF THE CASE ARE THAT THE ASSESSEE HAD FILED HIS RETURN OF INCOME FOR A.Y. 1995 - 96 ON 31.08.1995, DECLARING TOTAL INCOME OF RS.1,63,310/ - . THE ASSESSEE THEREAFTER REVISED HIS INCO ME ON 24.03.1998 AT RS.2,488/ - . THE MAIN SOURCE OF INCOME OF THE ASSESSEE WAS REMUNERATION FROM A PARTNERSHIP CONCERN ALONG WITH INCOME FROM OTHER SOURCES. SEARCH AND SEIZURE PROCEEDINGS WERE CONDUCTED ON 18.04.1995 IN THE CASE OF TANNA FAMILY GROUP OF CASES , AND THE A SSESSE E WAS COVERED IN THE SAME. THE ASSESSMENT ORDER WAS INITIALLY FRAMED BY THE A.O ON 27.03.1998 AND THE INCOME OF THE ASSESSEE WAS ASSESSED AT RS.33, 34,380/ - . TH E ASSESSEE ASSAILED THE SAID ASSESSMENT ORDER BEFORE THE CIT(A). THE CIT(A) DIRECTED THE A.O TO KAUNTEY M. TANNA ITA NO. 2159/MUM/2013 4 RECOMPUTE THE INCOME OF THE ASSESSEE IN RESPECT OF CERTAIN ISSUES, WHICH INTER ALIA INCLUDED THE ADDITION OF RS.5,64,562/ - MADE IN THE HANDS OF THE ASSESSEE ON ACCOUNT OF LOAN AND INTEREST. THE REVENUE BEING AGGRIEVED WITH THE RESTORI NG OF THE ASSESSMENT BY THE CIT(A) TO THE FILE OF THE A.O, THEREIN FILED AN APPEAL WITH THE TRIBUNAL ON 25.05.1999. THE A.O IN THE MEAN TIME GAVE EFFECT TO THE DIRECTIONS OF T H E TRIBUNAL, VIDE HIS ORDER PASSED U/S. 143(3) R.W.S. 254 , DATED 30 . 03 . 2001. THE A.O IN HIS AFORESAID ORDER REFERRED TO THE SEIZED ANNEXURE, VIZ. A LOOSE SHEET, MARKED AS ANNEXURE A/12 - PAGE NO. 128 , AND BEING OF THE VIEW THAT THE AMOUNT OF RS. 4,60,000/ - (AS WAS GATHERED BY THE A.O ON DECODING THE CONTENTS THEREOF) PERTAI NED TO THE LOAN S ADVANCED BY THE ASSESSEE TO VARIOUS PARTIES , WHILE FOR THE AMOUNT OF RS.48,868/ - MENTIONED IN THE SAID DOCUMENT WAS THE INTEREST RECEIVED BY THE ASSESSEE ON THE SAID LOAN S . THE A.O THUS IN THE COURSE OF SUCH FRESH ASSESSMENT MADE AN ADD ITION OF RS.5,08,868/ - [I.E RS.4,60,000/ - (+) RS.48,868/ - ] IN THE HANDS OF THE ASSESSEE. THE ASSESSEE CARRIED THE AFORESAID ORDER PASSED BY THE A.O U/S 143(3) R.W.S 254 BEFORE THE CIT(A) WHO DELETED THE ADDITION OF RS.5,08,868/ - (SUPRA) MADE BY THE A.O . TH E REVENUE AGGRIEVED WITH THE ORDER OF THE CIT(A ) ASSAILED THE SAME BEFORE THE TRIBUNAL. THE TRIBUNAL VIDE ITS ORDER DATED 06.02.2008, PASSED IN ITA NO. 1542/MUM/2004 RESTORE D THE MATTER TO THE FILE OF THE A.O , WITH A DIRECTION THAT A FRESH ORDER BE PASS ED AFTER AFFORDING AN OPPORTUNITY TO THE ASSESSEE. THE TRIBUNAL WHILE SETTING ASIDE THE MATTER TO THE FILE OF THE A.O, OBSERVED AS UNDER: - THE A SSESSING OFFICER , BY DECODING THE FIGURE , HAD ARRIVED AT CONCLUSION THAT THE FIGURE OF TOTAL LOAN ADVANCED BY THE ASSESSEE MAY BE OF RS.4,60,000/ - AND INTEREST THEREON MAY BE OF RS.48,868/ - AS MENTIONED AT PAGE NO. 128 . SINCE THIS PARTICULAR PAGE WAS NOT FOUND FROM THE POSSESSI O N OF THE ASSESSEE , THE BENEFIT OF DOUBT CAN BE GIVEN TO THE ASSESSEE. HOWEVER, AS THE NAME KMT IS MENTIONED AND THE ASSESSEE HAS TAKEN A PLEA BEFORE THE LEARNED CIT(A) THAT THE ENTRIES KAUNTEY M. TANNA ITA NO. 2159/MUM/2013 5 HAVE BEEN MADE IN THE FIRMS BOOKS OF ACCOUNT AND THE AMOUNT DOES NOT PERTAIN TO THE Y EAR UNDER CONSIDERATION. THE ASSESSING OFFICER WAS NOT ALLOWED ANY OPPORTUNITY TO EXAMINE THIS ASPECT BY THE LEARNED CIT(A). AFTER EXAMINING THE NOTING ON PAGE NO. 128, NO DOUBT REMAINS THAT THE CALCULATION OF INTEREST PERTAINS TO THE ASSESSMENT YEAR 1996 - 97. THEREFORE, IN OUR VIEW, THE LEARNED CIT(A) WAS RIGHT I N OBSERVING TH A T THE CALCULATION OF INCOME DOES NOT PERTAIN TO THE YEAR UNDER CONSIDERATION. HOWEVER , AS STATED ABOVE, NO OPPORTUNITY WAS GIVEN TO THE ASSESSING OFFICER WHILE DELETING THE ADDITIONS. WE , THEREFORE, FEEL THAT TO MEET THE ENDS OF JUSTICE TO BOTH THE PARTIES THE MATTER SHOULD GO TO THE FILE OF THE ASSESSING OFFICER. ACCORDINGLY, WE RESTORE THIS ISSUE TO THE FILE OF THE ASSESSING OFFICER. THE ASSESSING OFFICER HAS MENTIONED IN HIS ORDER T HAT THIS INCOME MAY RELATE TO THE ASSESSMENT YEARS 1994 - 95 AND 1995 - 96. IF SOME INVESTMENTS ARE MADE IN ASSESSMENT YEAR 1994 - 95, THEN OF COURSE NO ADDITION CAN BE MAD E DURING THE YEAR UNDER CONSIDERATION, I.E. ASSESSMENT YEAR 1995 - 96. ACCORDINGLY, THE ASSE SSING OFFICER IS DIRECTED TO PASS A FRESH ORDER AFTER AFFORDING OPPORTUNITY TO THE ASSESSEE. THE A.O PURSUANT TO THE AFORESAID DIRECTIONS OF THE TRIBUNAL , INITIATED FRESH ASSESSMENT PROCEEDINGS AND ISSUED A N OTICE U/S. 143(2) ON 04.06.2008. THE ASSESSEE SUBMITTED BEFORE THE A.O THAT AS HE HAD FILED A M ISCELLANEOUS APPLICATION BEFORE THE TRIBUNAL IN RESPECT OF THE LATTER S ORDER DATED 06.02.2008, THEREFORE , T HE ASSESSMENT PROCEEDINGS MAY BE KEPT IN ABEYANCE TILL THE DISPOSAL O F THE SAID APPLICATION. THE A.O HOWEVER NOT FINDING FAVOUR WITH THE SAID REQUEST OF THE ASSESSEE PROCEEDED WITH THE ASSESSMENT PROCEEDINGS . THE A.O WHILE FRAMING THE FRESH ASSESSMENT OBSERVED THAT AS THE ADVANCE/LOANS WERE NOT FOUND REFLECTED ON THE ASS ETS SIDE OF THE BALANCE SHEET OF EARLIER YEARS, THEREFORE , THE AMOUNT OF LOAN OF RS.4,60,000/ - ALONGWITH THE INTEREST OF RS.48,868/ - COULD SAFELY BE RELATED TO THE YEAR UNDER CONSIDERATION, VIZ. A.Y. 1995 - 96 , IN THE HANDS OF THE ASSESSEE . THUS, THE A.O WHILE FRAMING THE AFORESAID ASSESSMENT ENDORSED THE OBSERVATIONS OF HIS PREDECESSOR AND RETAINED THE ADDITION OF RS.5,08,868/ - (SUPRA) IN THE HANDS OF THE ASSESSEE , VIDE HIS ORDER PASSED U/S 1 4 3(3) R.W.S 254 , DATED. 29.12.2008 . THE ASSESSEE ASSAILED THE ASS ESSMENT FRAMED BY THE A.O BEFORE THE CIT(A). THE CIT(A) IN THE KAUNTEY M. TANNA ITA NO. 2159/MUM/2013 6 COURSE OF THE APPELLATE PROCEEDINGS OBSERVED THAT THE A.O HAD FAILED TO CARRY OUT ANY VERIFICATION AS REGARDS THE ENTRIES MENTIONED IN THE SEIZED ANNEXURE, VIZ. A/12 - PAGE 128 . THE CIT(A) THU S CALLED FOR A REMAND REPORT AND DIRECTED THE A.O TO PERUSE THE SEIZED DOCUMENT , VIZ. PAGE 128 AND CORRELATE TH E CONTENTS OF THE SAME WITH THE OTHER SEIZED MATERIAL . T HE CIT(A) FURTHER SPECIFICALLY DIRECTED THE A.O TO VERIFY AS TO WHETHER THE AMOUNT MENTIONED THEREIN REPRESENTED LOAN TAKEN OR LOAN GIVEN . THE CIT(A) ALSO O BSERVED THAT NOTHING WAS DISCERNIBLE FROM THE DATE 31.10.1994 AS WAS FOUND MENTIONED I N THE ZEROX COPY OF THE SEIZED DOCUMENT, VIZ. PAGE 128 (SUPRA). THE A.O IN COMPLIANCE TO THE DIRECTIONS OF THE CIT(A ) FURNISHED HIS REMAND REPORT , DATED. 17.01.2011 . TH E A.O IN HIS REMAND REPORT REFERRING TO THE FACTS EMERGING FROM A L E TTER DATED 08.01.2001 WHICH WAS ISSUED TO THE ASSESSEE BY HIS PREDECESSOR, THEREIN STATED THAT THE THEN A.O HAD IN HIS AFORESAID LETTER PROPOSED TO TREAT THE AMOUNT OF RS.4,60,000/ - (SUPRA) AS A LOAN TAKEN BY THE ASSESSEE , H OWEVER, THE SAME DID NOT CRYSTALLISE FOR THE REASON THAT THE ASSESSEE VIDE HIS REPLY DATED 13.02.2001 HAD CLAIMED THAT IT HAD NOT TAKEN/RAISED ANY LOAN, AS NO SUCH AMOUNT WAS REQUIRED BY HIM. IT WAS FUR T HER OBSERVED BY THE A.O THAT THE ASSESSEE VIDE HIS AFORESAID L E TTER ALSO STATED THAT THE AMOUNT MENTIONED THEREIN APPEAR ED TO BE A CALCULATION OF INTEREST OF SOME PAR TIES, HOWEVER , THE SAME WAS NOT RELATED TO HIM. THE A.O FURTHER STATED IN HIS REMAND REPORT THAT THE ASSESSEE DURING THE COURSE OF THE REMAND PROCEEDINGS HAD VIDE HIS L E TTER DATED 07.08.201 2 DENIED THE OWNERSHIP OF THE DOCUMENT , VIZ. ANNEXURE A/12 PAGE 128 , AND RATHER EXPRESSED H IS UNAWARENESS ABOUT THE PARTIES WHOSE NAMES WERE FOUND MENTIONED THEREIN. THE A.O IN HIS REMAND REPORT STATED THAT AS THE DOCUMENT WAS SEIZED FROM THE ASSESSE E , THEREFORE, HE COULD NOT HAVE SUMMARILY DENIED THE OWNERSHIP OF THE SAME. THE A.O FURTHER REFERRING TO THE SEIZED LOOSE SHEET, VIZ. PAGE 128 , THEREIN KAUNTEY M. TANNA ITA NO. 2159/MUM/2013 7 REFERRED TO THE FACT THAT ON THE TOP OF THE SAID DOCUMENT THERE WAS CLEAR MENTION OF A/C KMT , ON THE BASIS OF WHICH THE SAME COULD SAFELY BE RELATED TO THE ASSESSEE. THE A.O IN HIS REMAND REPORT CONCEDED THAT IT REMAIN ED AS A MATTER OF FACT THAT THE AMOUNT OF RS.4,60,000/ - (SUPRA) AND THE PARTIES MENTIONED IN THE AFORESAID SEIZED DOCUMENT, VIZ. PAGE 128 COULD NOT BE CORRELATED WITH THE OTHER SEIZED MATERIA L , THEREFORE, IT COULD NOT BE ASCERTAINED AS TO WHETHER THE SAME REPRESENTED LOAN TAKEN OR LOAN GIVEN . THE A.O IN THE BACKDROP OF THE AFORESAID FACTS STATED THAT T HE ASSESSEE HAD FAILED TO PROVIDE ANY EXPLANATION AS REGARDS THE AMOUNT OF RS.5,08,8 68 / - (SUPRA) DURING THE COURSE OF THE ASSESSMENT PROCEEDINGS. THE CIT(A) AFTER DELIBERATING ON THE REMAND REPORT OF THE A.O OBSERVED THAT AS THE DOCUMENT WAS SEIZED FROM THE ASSESSEE AND THE SAME REFERRED TO A/C KMT , THEREFORE , THE ASSESSEE COULD NOT BE ALLOWED TO DISTANCE HIMSELF FROM THE AFORESAID DOCUMENT. THOUGH THE CIT(A) OBSERVED THAT THE A.O HAD ACCEPTED THAT THE AMOUNT OF RS.4,60,000/ - (SUPRA) COULD NOT BE CORRELATED WITH THE SEIZED RECORDS , NOR IT COULD BE VERIFIED THA T WHETHER THE SAME REPRESENTED LOAN GIVEN OR LOAN TAKEN , BUT AS THE ASSESSEE HAD FAILED TO PROVIDE ANY EXPLANATION IN RESPECT OF THE AMOUNT OF RS.5,08 , 8 68 / - (SUPRA), THEREFORE, THE ADDITION MADE BY THE A.O WAS JUSTIFIED. 5. THE ASSESSEE BEING AGGRIEVED WITH THE AFORESAID ORDER OF THE CIT(A) HAD CARRIED THE MATTER IN APPEAL BEFORE US. THAT IT WAS SUBMITTED BY THE LD. AUTHORIZE D REPRESENTATIVE (FOR SHORT A.R ) FOR THE ASSESSEE THAT THE NAME OF THE ASSESSEE DID NOT FIND ANY MEN TION IN THE SEIZED DOCUMENT , VIZ. A NNEXURE A/12 - PAGE 128 , NOR WAS THERE ANY OTHER MATERIAL WHICH COULD GO TO RELATE THE SAME WITH THE ASSESSEE . IT WAS FURTHER AVERRED BY THE LD. A.R THAT EVEN OTHERWISE AS NO DATE WAS FOUND MENTIONED IN THE AFORE SAID SEIZED DOCUMENT , THEREFORE , FOR THE SAID REASON ALSO NO ADVERSE INFERENCES IN CONTEXT OF THE SAME WERE KAUNTEY M. TANNA ITA NO. 2159/MUM/2013 8 LIABLE TO BE DRAWN IN THE HANDS OF THE ASSESSEE DURING THE YEAR UNDER CONSIDERATION. THE LD. A.R. IN ORDER TO DRIVE HOME HIS AFORESAID CONTENTION TOOK U S THROUGH THE EARLIER ORDER OF T HE ITAT, MUMBAI BENCH A IN THE CASE OF THE ASSESSEE, VIZ. ITO VS. SHRI KAUNTEY M. TANNA (ITA NO. 1542/MUM/2004 ) , DATED 06.02.2008. THE LD. A.R FURTHER DREW OU R ATTENTION TO THE ORDER PASSED BY THE A.O U/S 143(3) R.W.S. 254, DATED 29.12.2008, AND SUBMITTED THAT DESPITE THE FACT THE MATTER WAS SET ASIDE BY THE TRIBUNAL TO THE FILE OF THE A.O FOR FRAMING OF FRESH ASSESSMENT, THE LATTER HOWEVER BYPASSING THE SPE CIFIC DIRECTIONS AND THE OBSERVATIONS RECORDED BY THE TRIBUNAL , HAD HOWEVER D RAWN ADVERSE INFERENCES IN THE HANDS OF THE ASSESSEE BY MERELY REFERRING TO AND RELYING ON THE OBSERVATIONS RECORDED BY HIS PREDECESSOR, VIZ. DCIT - CENTRAL CIRCLE - 27 . THE LD. A.R IN ORDER TO SUPPORT HIS CONTENTION TOOK US THROUGH THE RELEVANT PART OF THE EARLIER ASSESSMENT ORDER PASSED BY THE A.O U/S. 143(3), DATED 30.08.2001 ( PAGE 33 OF APB ). THE LD. A.R. FURTHER SUBMITTED THAT THE CIT(A) WHILE DISPOSING OF THE APPEAL OF THE ASSESSEE, VIDE HIS ORDER DATED 10.12.2003, TAKING COGNIZANCE OF THE CONTENTIONS OF THE ASSESS E E THAT THE DATES MENTIONED IN THE SEIZED DOCUMENT , VIZ. PAGE 128 WERE NOT RELATABLE TO THE YEAR UNDER CONSIDERATION, HAD THUS FOUND FAVOUR WITH THE SAID CLAIM OF THE ASSESSEE AND HAD DELETED THE ADDITION OF RS. 5,08,868/ - (SUPRA) . IT WAS FURTHER SUBMITTED BY THE LD. A.R THAT THE CIT(A) HAD OBSERVED THAT THE ADDITION WITH RESPECT TO THE AMOUNT OF RS.4 ,60,000/ - WAS FOUND TO HAVE BEEN MADE BY THE A.O WITHOUT CARRYING OUT ANY VERIFICATIONS. THE LD. A.R FURTHER TOOK US THROUGH THE RELEVANT EXTRACTS OF THE REMAND REPORT OF THE A.O . THE LD. A.R DREW OU R ATTENTION TO PARA 3.1.4 OF THE REMAND REPORT ( P AGE 72 OF APB), WHEREIN THE A.O HAD FAIRLY ADMITTED THAT NEITHER THE AMOUNT OF RS.4,60,000/ - (SUPRA), NOR THE PARTIES MENTIONED IN THE SEIZED DOCUMENT, VIZ. PAGE 128 COULD BE CORRELATED WITH THE OTHER SEIZED KAUNTEY M. TANNA ITA NO. 2159/MUM/2013 9 MATERIAL , FAILING WHICH IT COULD NOT BE ASCERTAIN E D AS TO WHETHER THE AMOUNT S MENTIONED THEREIN WERE LOAN S GIVEN OR TAKEN. THAT IN THE BACKDROP OF THE AFORESAID FACTS IT WAS VEHEMENTLY AVERRED BY THE LD. A.R THAT THE ASSESSEE HAD SUFFERED AN ADDITION OF RS.5,08,8 68 / - (SUPRA) DESPITE ABSENCE OF ANY EVIDENCE WHICH COULD GO TO JUSTIFY DRAWING OF SUCH ADVERSE INFERENCE S IN HIS HANDS . THE LD. A.R. RELYING ON A JUDGMENT OF THE HONBLE SUPREME COURT IN THE CASE OF COMMON CAUSE (REGISTER ED SOCIETY) AND OTHERS VS. UNION OF INDIA AND OTHERS (CWP NO. 505 OF 2015 ) , DATED 11.01.2017 , SUBMITTED THAT THE HONBLE APEX COURT IN THE AFORESAID JUDGMENT HAD CLEARLY HELD THAT RANDOM SHEETS AND LOOSE PAPERS IN THE ABSENCE OF ANY CORROBORATIVE MATERIAL WOULD HAVE NO EVIDENTIARY VALUE. IT WAS SUBMITTED BY THE LD. A.R THAT THE HO NBLE SUPREME COURT RELYING O N ITS EARLIER JUDGMENT IN THE CASE OF CBI VS. V.C. SHUKLA (1998) (3) SCC 410 , HAD HELD THAT AS THE ENTRIES IN THE BOOKS OF ACCOUNTS ARE MERELY CORROBORATIVE EVIDENCE, THUS INDEPENDENT EVIDENCE IS NECESSARY SO THAT THE TRUSTWORTHINESS OF THE ENTRIES CONTAINED THEREIN COULD BE VERIFIED . THUS IN THE BACKDROP OF THE AFORESAID FACTUAL MATRIX READ WITH THE SETTLED POSITION OF LAW SO LAID DOWN BY THE HO NBLE SUPREME COURT, IT WAS SUBMITTED BY THE LD. A.R THAT THE CIT(A) HAD GRAVELY ERRED IN LAW BY UPHOLD ING THE ORDER OF THE A.O, WHEREIN THE LATTER HAD MADE ADDITIONS DESPITE ABSENCE OF ANY MATERIAL WHICH COULD GO TO JUSTIFY DRAWING OF ADVERSE INFERENCES IN THE HANDS OF THE ASSESSEE. PER CONTRA, THE LD. D.R RELIED ON THE ORDER S OF THE LOWER AUTHORITIES . 6 . WE HAVE HEARD THE A UTHORIZED R EPRESENTATIVE S FOR BOTH THE PARTIES, PERUSED THE ORDERS OF THE LOWER AUTHORITIES AND THE MATERIAL AVAILABLE ON RECORD . WE HAVE PURPOSIVELY CULLED OUT THE FACTS AS HAD EMERGED RIGHT FROM THE FRAMING OF THE O RIGINAL ASSESSMENT , TILL THE PASSING OF THE IMPUGNED ORDER BY THE CIT(A) IN THE CASE OF THE ASSESSEE , AS THE SAME WILL HAVE A STRONG BEARING ON THE ADJUDICATION OF KAUNTEY M. TANNA ITA NO. 2159/MUM/2013 10 THE ISSUE UNDER CONSIDERATION. WE FIND THAT THE TRIBUNAL HAD VIDE ITS ORDER DATED 06.02.2008 , PASSED IN ITA NO. 1542/MUM/2004 OBSERVED THAT THE SEIZED DOCUMENT, VIZ. PAGE NO. 128 OF A NNEXURE A/12 WAS NOT FOUND FROM THE POSSESSION OF THE ASSESSEE. WE ARE UNABLE TO COMPREHEND THAT IN LIGHT OF THE AFORESAID SPECIFIC OBSERVATION RECORDED BY THE TRIBUNAL THAT THE SEIZED DOCUMENT, VIZ. PAGE 128 WAS NOT FOUND FROM THE POSSESSION OF THE ASSESSEE , HOW THE AUTHORITIES THEREAFTER IN THE ABSENCE OF PLACING ON RECORD ANY MATERIAL TO THE CONTRARY HAD CONCLUDED THAT THE SAID DOCUMENT WAS SEIZED FROM THE POSSESSION OF THE ASSESSEE DURING THE COURSE OF THE SEARCH PROCEEDINGS. BE THAT AS IT MAY, WE FIND THAT THE TRIBUNAL AFTER PERUSING THE NOTINGS RECORDED AT PAGE 128 (SUPRA) , HAD THEREIN CONCLUDED THAT THERE REMAIN ED NO DOUBT THAT THE CALCULATION OF INTEREST OF RS.48,868/ - (SUPRA) PERTAINED TO THE A.Y 1996 - 97 , AND NOT THE YEAR UNDER CONSIDERATION . WE THOUGH ARE NOT OBLIVIOUS OF THE FACT THAT THE TRIBUNAL VIDE ITS AFORESAID ORDER DATED 06.02.2008 HAD RESTORE D THE ISSUE TO THE FILE OF THE A.O FOR FRESH ADJUDICATION, BUT SUCH RESTORATION HAD ONLY OCCASIONED FOR THE REASON THAT IT WAS PLEADED BY THE REVENUE BEFORE THE TRIBUNAL THAT THE CIT(A) WHILE DELETING THE ADDITIONS HAD NOT AFFORDED ANY OPPORTUNITY TO THE A.O. WE ARE OF THE CONSIDERED VIEW THAT THE OBSERVATIONS OF THE TRIBUNAL THAT THE AMOUNT OF RS.48,868/ - (SUPRA) PERTAINED TO A.Y. 1996 - 97 AND NOT TH E YEAR UNDER CONSIDERATION HA D NOT BEEN DISLODGED BY THE DEPARTMENT TILL DATE BY PLACING ON RECORD ANY MATERIAL TO THE CONTRARY , THEREFORE, THE SAME HOLDS THE GROUND AS ON DATE AND CANNOT BE SUMMARILY BRUSHED ASIDE. WE FIND THAT THE TRIBUNAL W HILE RESTORING THE MATTER TO THE FILE OF THE A.O HAD GONE BY THE OBSERVATIONS OF THE A.O THAT THE INCOME MAY RELATE TO A.Y. 1994 - 95 AND A.Y: 1995 - 96, AND CONSIDERING THE SAME HAD SPECIFICALLY DIRECTED THAT IF THE INVESTMENTS WERE FOUND TO BE MADE IN A.Y. 1 994 - 95, THEN NO ADDITION WAS LIABLE TO BE MADE IN THE HANDS KAUNTEY M. TANNA ITA NO. 2159/MUM/2013 11 OF THE ASSESSEE DURING THE YEAR UNDER CONSIDERATION, I.E. A.Y. 1995 - 96. WE FIND THAT AS STAND S GATHERED FROM THE RECORDS, IT REMAINS AS A MATTER OF FACT THAT SINCE INCEPTION, VIZ. ORDER PASSED BY THE A.O U/S 143(3) ON 27.03.1998, THE REVENUE HAD REMAIN ED CONFUSED AS TO WHETHER THE AMOUNT OF RS. 4,60,000/ - (SUPRA) (AS IS STATED TO HAVE BEEN DECODED BY THE REVENUE) GATHERED FROM THE SEIZED DOCUMENT , VIZ. PAGE 128 , REPRESENTED A L OAN GIVEN OR A LOAN TAKEN . THAT A PERUSAL OF THE RECORDS REVEALS THAT THE A.O WHILE FRAMING THE ASSESSMENT UNDER CONSIDERATION , HAD VIDE HIS L E TTER DATED 08.01.2001 PROPOSED THAT THE AMOUNT OF RS.4,60,000/ - (SUPRA) BE TREATED AS LOANS TAKEN BY THE ASSESSEE. WE FIND THAT AS THE ASSESSEE HAD CLAIMED THAT THE SEIZED DOCUMENT , VIZ. PAGE 128 DID NOT BELONG TO HIM, NOR WAS HE AWARE OF THE PARTIES WHOSE NAMES WERE FOUND MENTIONED IN THE SAID DOCUMENT , THEREFORE , ONLY FOR THE SAID REASON THE A.O WITHOUT ASSIGNING ANY REASON , MU CH THE LESS A COGENT REASON SHIFTED FROM HIS EARLIER VIEW , AN D HELD THAT THE AMOUNT OF RS.4,60,000/ - (SUPRA) REPRESENTED THE LOANS ADVANCED BY THE ASSESSEE TO VARIOUS PARTIES, AND HAD ON THE SAID COUNT MADE AN ADDITION OF RS.4,60,000/ - IN THE HANDS OF THE ASSESSEE. WE ARE OF THE CONSIDERED VIEW THAT THE REVENUE HAD ABSOLUTELY FAILED TO ESTABLISH AS TO WHETHER THE AMOUNT OF RS.4,60,000/ - (SUPRA) AS GATHERED FROM THE IMPUGNED SEIZED DOCUMENT , VIZ. PAGE 128 PERTAINED TO A LOAN GIVEN OR A LOAN TAKEN BY THE ASSESSEE , WHICH FACTUAL POSITION IS DISCERNIBLE FROM THE INCONSISTENT AND CONTRADICTORY STAND S THAT HAD BEEN TAKEN BY THE AUTHORITIES DURING THE COURSE OF THE PROCEEDINGS. WE FURTHER FIND THAT THE CIT(A) WHILE CALLING FOR A REMAND REPORT FROM THE A.O HAD SPECIFICALLY DIRECTED HIM TO CORRELATE THE CONTENTS OF THE IMPUGNED SEIZED DOCUMENT, VIZ. PAGE 128 WI TH THE OTHER SEIZED MATERIAL , SO THAT IT MAY BE GATHERED AS TO WHETHER THE CONTENTS OF THE SAME REPRESENTED THE LOAN TAKEN OR GIVEN BY THE ASSESSEE . WE FIND THAT THE KAUNTEY M. TANNA ITA NO. 2159/MUM/2013 12 A.O IN H IS REMAND REPORT HAD FAIRLY ADMITTED THAT AS NEITHER THE AMOUNT OF RS.4,60,000 / - (SUPRA), NOR THE PARTIES WHOSE NAME S FIGURED IN THE SAID SEIZED DOCUMENT , VIZ. PAGE 128 (SUPRA) COULD BE CORRELATED WITH THE OTHER SEIZED MATERIAL , THEREFORE , IT COULD NOT BE ASCERTAIN ED WHETHER THE SAME PERTAINED TO A LOAN GIVEN OR LOAN TAKEN . WE ARE OF THE CONSIDERED VIEW THAT NOW WHEN IT REMAINS AS A MATTER OF FACT THAT NOT ONLY THE IMPUGNED CONTENTS OF THE SEIZED DOCUMENT, VIZ. PAGE 128 COULD BE CORRELATED BY THE REVENUE WITH ANY SEIZED MATERIAL , WHICH COULD HAVE JUSTIFIED DRAWING OF ADVE RSE INFERENCES IN THE HANDS OF THE ASSESSEE, THEREFORE, IT CAN SAFELY BE CONCLUDED THAT TILL DATE IT REMAINS A N UNSOLVED MYSTERY FOR THE REVENUE AS TO WHETHER THE SAME REPRESENTED LOAN S GIVEN OR TAKEN . WE FURTHER FIND THAT EVEN OTHERWISE THERE IS NO DATE MENTIONED IN THE SEIZED DOCUMENT , VIZ. PAGE 128 ON THE BASIS OF WHICH THE SAME COULD BE RELATED TO THE YEAR UNDER CONSIDERATION. WE ARE UNABLE TO COMPREHEND T HAT AS TO HOW THE A.O WHO HAD TAKEN A VIE W THAT THE CONTENTS OF THE SEIZED DOCUMENT , VIZ. PAGE 128 REPRESENTED LOANS TAKEN BY THE ASSESSEE, WOULD THEREIN BE JUSTIFIED IN HOLDING TO THE CONTRARY THAT THE SAME REPRESENTED LOANS ADVANCED BY THE ASSESSEE TO VARIOUS PARTIES, ONLY FOR THE REASON THAT THE ASSESSEE HAD DISTANCED HIMSELF FROM THE SAID IMPUGNED DOCUMENT AND THE CONTENTS THEREOF . WE ARE FURTHER ABSOLUTELY NOT AT ALL IMPRESSED BY THE CLAIM OF THE LOWER AUTHORITIES THAT AS THE TERM A/C KMT APPEARED ON THE IMPUGNED DOCUMENT, THEREFORE , IT C OULD SAFELY BE HELD THAT THE SAME REFER RED TO THE NAME OF THE ASSESSEE, VIZ. SHRI KAUNTEY M. TANNA. WE THUS IN LIGHT OF OUR AFORESAID OBSERVATIONS , BEING OF THE CONSIDERED VIEW THAT THERE IS NO MATERIAL BEFORE US WHICH COULD GO TO PERSUADE US TO UPHOLD THE ADDITION OF RS. 5,08,868/ - (SUPRA) IN THE HANDS OF THE ASSESSEE, THUS , IN THE BACKDROP OF T HE FACTS OF THE CASE, THEREIN HOLDING A STRONG CONVICTION THAT THERE IS NO REASON FOR US TO SUSTAIN THE ADDITION S MADE BY THE A.O IN THE HANDS OF THE KAUNTEY M. TANNA ITA NO. 2159/MUM/2013 13 ASSESSEE, WH ICH THERE AFTER HAD BEEN UPHELD BY THE CIT(A), THUS DELETE THE SAME. THE ORDER PASSED BY THE CIT(A) IS SET ASIDE. 4. THE APPEAL OF THE ASSESSEE IS ALLOWED. ORDER PRO NOUNCED IN THE OPEN COURT ON 11 . 08.2017 SD/ - SD/ - ( G.S. PANNU ) ( RAVISH SOOD ) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI ; 11 .08.2017 PS. ROHIT KUMAR / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ( ) / THE CIT(A) - 4. / CIT 5. , , / DR, ITAT, MUMBAI 6. / GUARD FILE . //TRUE COPY// / BY ORDER, / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI KAUNTEY M. TANNA ITA NO. 2159/MUM/2013 14