Shri Rajnish Tiwari, Lucknow V. Asstt. Commissioner of Income Tax, Lucknow

ITA 233/LKW/2012

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 87758 (ITAT-LUCKNOW)
• Duration Of Justice: 2 year(s) 9 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-02-2015
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 05-01-2015
• Assessment Year: 2008-2009
• Appeal Filed On: 01-05-2012
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Assessee Lawyers: ARE BEING DISPOSED OF
• Keywords: Unexplained cash credit; Search and seizure; Source of fund; Validity of assessment
• Section: 80C; 153A

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH B, LUCKNOW BEFORE SHRI SUNIL KUMAR YADAV, JUDICIAL MEMBER AND SHRI A.K. GARODIA, ACCOUNTANT MEMBER ITA NOS.233 & 234/LKW/2012 A.YRS.:2008 - 09 & 2009 - 10 SHRI RAJNISH TIWARI, PROP. SHREE RAM AGENCIES, 538/208A, TRIVENI NAGAR, LUCKNOW. PAN:AFGPT9662Q VS. A.C.I.T., CENTRAL CIRCLE - I, LUCKNOW. (APPELLANT) (RESPONDENT) O R D E R PER A. K. GARODIA, A.M. BOTH THESE APPEALS ARE FILED BY THE ASSESSEE, WHICH ARE DIRECTED AGAINST THE COMBINED ORDER OF LEARNED CIT(A) - III, LUCKNOW DATED 25/11/2011 FOR THE ASSESSMENT YEARS 2008 - 09 AND 2009 - 2010. BOTH THE APPEALS WERE HEARD TOGETHER AND ARE BEING DISPOSED OF BY WAY OF THIS COMMON ORDER FOR THE SAKE OF CONVENIENCE. 2. FIRST WE TAKE UP THE APPEAL FOR ASSESSMENT YEAR 2008 - 09 I.E. I.T.A. NO.233/LKW/2012. GROUND NOS. 1 & 2 ARE AS UNDER: 1. BECAUSE THE 'CIT(A)' HAS ERRED IN LAW AND ON FACTS IN HOLDING THAT THE ISSUE OF ASSUMPTION OF JURISDICTION OF ASSESSING OFFICER TO MAKE ASSESSMENT UNDER SECTION 153A COULD NOT HAVE BEEN RAISED IN APPEAL AND IN FURTHER HOLDING THAT THE APPEAL WAS NOT M AINTAINABLE ON THAT ISSUE. APPELLANT BY SHRI P. K. KAPOOR, C.A. RESPONDENT BY SHRI VIVEK MISHRA, C.I.T., D. R. DATE OF HEARING 05/01/2015 DATE OF PRONOUNCEMENT 1 2 /02/2015 2 2. BECAUSE THE APPELLANT HAD RAISED THE ISSUE OF VALIDITY OF ASSUMPTION OF JURISDICTION UNDER SECTION 153A IN THE APPEAL ON THE GROUND THAT THE APPELLANT COULD NOT HAVE BEEN TREATED TO BE THE PERSON IN WHOSE CASE SEARCH UNDER SE CTION 132(1) HAD BEEN INITIATED AND THE SAID GROUND GOING TO THE VERY ROOT OF THE ASSESSMENT ORDER DATED 28.17.2010 ITSELF WAS MAINTAINABLE AND ON A DUE CONSIDERATION OF MATERIAL AND INFORMATION ALREADY ON RECORD, THE SAID ASSESSMENT ORDER ITSELF WAS LIABL E TO BE DECLARED AS NULL AND VOID. 3. AT THE VERY OUTSET, LEARNED A.R. OF THE ASSESSEE FAIRLY CONCEDED THAT THE ISSUE INVOLVED IN THESE GROUNDS IS COVERED AGAINST THE ASSESSEE BY A JUDGMENT OF HON'BLE JURISDICTIONAL HIGH COURT RENDERED IN THE CASE OF CIT VS. DR A. K. BANSAL (INDIVIDUAL) [2013] 355 ITR 513 (ALL). 4. LEARNED D.R. OF THE REVENUE SUPPORTED THE ORDERS OF THE AUTHORITIES BELOW. 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. WE FIND THAT AS PER TH IS JUDGMENT OF HON'BLE JURISDICTIONAL HIGH COURT, THE ISSUE INVOLVED IN THESE GROUNDS IS SQUARELY COVERED AGAINST THE ASSESSEE. IN THIS CASE, IT WAS HELD BY HON'BLE JURISDICTIONAL HIGH COURT THAT NEITHER T HE ASSESSING OFFICER N OR THE APPELLATE AUTHORITY, CA N LOOK INTO THE VALIDITY OF THE SEARCH BY CALLING FOR THE WARRANT OF AUTHORISATION AND EXAMINING THE RECORDS AUTHORISING SEARCH FOR THE PURPOSE OF AN ENQUIRY WHETHER THE SEARCH WAS VALID. RESPECTFULLY FOLLOWING THIS JUDGMENT OF HON'BLE JURISDICTIONAL HIGH COURT, THIS ISSUE IS DECIDED AGAINST THE ASSESSEE AND ACCORDINGLY THESE GROUNDS ARE REJECTED. 6. GROUND NO. 3 IS AS UNDER: 3. BECAUSE THE 'CIT(A)' HAS ERRED IN LAW AND ON FACTS IN UPHOLDING THE ADDITIONS OF; 3 ( A ) RS.1,77,010 : ON ACCOUNT OF CREDIT APPEARING IN THE CAPITAL ACCOUNT OF THE APPELLANT ( B ) RS.60,000 : ON ACCOUNT OF LOW WITHDRAWALS FOR HOUSEHOLD EXPENSES, OUT OF RS.72,000; AS HAD BEEN MADE IN THE ASSESSMENT. 7. IT WAS SUBMITTED BY LEARNED A.R. OF THE ASSESSEE THAT THE AMOUNT OF RS.1.50 LAC WAS GIVEN BY SHRI CHANDRA BHAL TIWARI, FATHER OF THE ASSESSEE AND HIS CONFIRMATION IS AVAILABLE ON PAGE NO. 35 OF THE PAPER BOOK. HE ALSO SUBMITTED THAT THE COPY OF BANK PASSBOOK OF THE ASSESSEE FOR THE RELEVANT PERIOD IS AVAILABLE ON PAGE NO. 41 OF T HE PAPER BOOK WHEREIN A CREDIT OF RS.1.50 LAC IS APPEARING IN HIS BANK ACCOUNT ON 13/01/2007. HE SUBMITTED THAT THE ADDITION MADE BY THE ASSESSING OFFICER IS NOT JUSTIFIED. HE ALSO PLACED RELIANCE ON A DECISION OF THIRD MEMBER OF THE TRIBUNAL RENDERED IN THE CASE OF RAJ KUMAR JAIN VS. ACIT [1994] 50 ITD 1 (ITAT [ALL]). HE SUBMITTED THAT IN THIS CASE, IT WAS HELD BY THE TRIBUNAL THAT IN THE ABSENCE OF ANY MATERIAL ON RECORD, NO ADDITION CAN BE MADE ON THE GROUND OF LOW HOUSE HOLD EXPENSES. 8. LEARNED D.R . OF THE REVENUE SUPPORTED THE ORDERS OF THE AUTHORITIES BELOW. 9. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. WE FIND THAT THESE TWO ISSUES WERE DECIDED BY LEARNED CIT(A) AS PER PARA 8.2.2 AND 8.3.1 OF HIS ORDER, WHICH ARE REPRODUCED BELOW FOR THE SAKE OF READY REFERENCE: - 8.2.2 I HAVE CONSIDERED THE GROUND OF APPEAL, THE ORDER OF THE ASSESSING OFFICER AND THE SUBMISSIONS MADE. IT IS A SETTLED PRINCIPLE OF LAW THAT WHERE A SUM IS FOUND CREDITED IN THE BOOKS OF ACCOUNT OF THE ASSESSEE, THE ONUS LIES ON HIM TO EXPLAIN THE SOURC E, CREDITWORTHINESS AND THE GENUINENESS OF THE TRANSACTION. AS PER THE PROVISIONS OF SECTION 68, IT IS IMMATERIAL WHEN DURING THE F.Y. THE CREDIT IS FOUND TO BE MADE. THE ASSESSING OFFICER HAS MENTIONED THAT THE PAST 4 INCOME OF THE ASSESSEE WAS NOT SO MUCH AS COULD LEAVE ANY POSSIBLE SAVING WITH THE APPELLANT AS WHATEVER AMOUNT WAS EARNED WAS UTILIZED FOR HOUSEHOLD EXPENSES. EVEN IN THE COURSE OF THE APPEAL, THE APPELLANT HAS NOT SATISFACTORILY EXPLAINED THE SOURCE OF THE CAPITAL INTRODUCED DURING THE FINAN CIAL YEAR. IT IS MERELY STATED THAT A CHEQUE NO. 54377 DATED 12.01.2007 OF THE AMOUNT OF RS.1,50,000/ - WAS GIVEN TO THE ASSESSEE BY HIS FATHER SHRI CHANDRA BHAL TIWARI AND A COPY OF THE CONFIRMATION CLAIMED TO BE FILED BEFORE THE ASSESSING OFFICER WAS ALSO FILED HOWEVER NEITHER THE CREDITWORTHINESS OF THE CREDITOR WAS ESTABLISHED NOR WAS IT APPARENT WHETHER THE CHEQUE WAS EVEN ENCASHED IN THE A.Y. 2007 - 08 AS THE COPY OF BANK ACCOUNT WAS NOT FILED. THE FATHER WAS ALSO NOT ASSESSED TO TAX. HENCE, THE GROUNDS OF APPEAL ARE REJECTED AND THE ADDITION OF RS.1,770,10/ - MADE IS HEREBY CONFIRMED. 8.3.1 I HAVE CONSIDERED THE GROUND OF APPEAL, THE ORDER OF THE ASSESSING OFFICER AND THE SUBMISSIONS MADE. DURING THE A.Y. 2007 - 08 WITHDRAWALS FOR HOUSEHOLD EXPENSES WERE SHOWN AT RS.96,000/ - MAKING THE AVERAGE WITHDRAWAL @RS.8000/ - PER MONTH. IN THE INITIAL SIX MONTHS, THE APPELLANT HAS NOT SHOWN ANY WITHDRAWAL. EVEN IN THE COURSE OF THE APPEAL, NO EXPLANATION HAS BEEN FILED AS TO HOW THE APPELLANT COULD INCUR THE HOUSEHO LD EXPENSES FOR SIX MONTHS WITHOUT ANY DRAWINGS. HENCE, THE ASSESSING OFFICER WAS JUSTIFIED IN MAKING THE ADDITION FOR THE WITHDRAWALS FOR HOUSEHOLD EXPENSES FOR THE INITIAL SIX MONTHS. HOWEVER, CONSIDERING THE FACT THAT THE AVERAGE WITHDRAWALS IN THE LAST YEAR WERE @ RS. 8000/ - , FOR THE FIRST SIX MONTHS, WITHDRAWALS FOR HOUSEHOLD EXPENSES ARE ESTIMATED @ RS.10,000/ - PER MONTH IN PLACE OF RS. 12 , 000/ - ESTIMATED BY THE ASSESSING OFFICER FOR THE FIRST SIX MONTHS AND THE ADDITION IS REDUCED TO RS. 60 , 000/ - IN PLACE OF RS. 72 , 000/ - RESULTING INTO RELIEF OF RS. 12 , 000/ - . HENCE, THESE GROUNDS OF APPEAL ARE PARTLY ALLOWED. 10. WE FIND THAT IT IS NOTED BY ASSESSING OFFICER IN THE ASSESSMENT ORDER THAT THIS IS THE FIRST YEAR OF BUSINESS OF SHRI RAM AGENCIES BUT THE ASSESS EE HAS SHOWN OPENING BALANCE OF CAPITAL AS ON 01/04/2007 AT RS.1,57,010/ - . THE ASSESSING OFFICER ASKED THE ASSESSEE TO EXPLAIN THE SAME ALONG WITH THE SUPPORTING DOCUMENTS REGARDING THE SOURCE OF OPENING CAPITAL AND ALSO 5 TO EXPLAIN THE SOURCE OF RS.20,000/ - INTRODUCED DURING THIS YEAR. IN REPLY, THE ASSESSEE HAS FURNISHED A COPY OF THE CAPITAL ACCOUNT AND HAS NOT PROVIDED ANY DETAILS REGARDING SOURCES OF FUND. THE ASSESSING OFFICER OBSERVED THAT IN THE EARLIER YEAR, THE ASSESSEE WAS HAVING MEAGER INCOME AND WAS UTILIZING ALL HIS INCOME FOR HOUSE HOLD PURPOSES AND THERE WAS NO POSSIBILITY OF ANY SAVING AND THEREFORE, THE OPENING BALANCE OF RS.1,57,010/ - SHOWN IN THE CAPITAL ACCOUNT, REMAINS AN UNEXPLAINED CREDIT ENTRY IN THE CAPITAL ACCOUNT OF THE ASSESSEE IN HIS BOOKS OF ACCOUNT. THE ASSESSING OFFICER FURTHER OBSERVED THAT THE ASSESSEE HAS TRIED TO EXPLAIN THIS ENTRY AS LOAN RECEIVED FROM HIS FATHER. HE ALSO NOTED THAT A CONFIRMATORY LETTER OF HIS FATHER HAS ALSO BEEN P ROVIDED. THEREAFTER, THE ASSESSING OFFICER OBSERVED THAT IT S NOT CLEAR AS TO WHAT ARE THE SOURCES OF INCOME OF HIS FATHER AS NEITHER COPY OF HIS BANK ACCOUNT NOR COPY OF HIS INCOME TAX RETURN HAS BEEN PROVIDED. UNDER THESE FACTS, IT WAS HELD BY THE ASSE SSING OFFICER THAT IT HAS TO BE ACCEPTED THAT THE ASSESSEE HAS NOT OFFERED ANY EXPLANATION REGARDING THESE CREDIT ENTRIES. BEFORE US ALSO, THE ASSESSEE HAS PROVIDED CONFIRMATION OF HIS FATHER AND COPY OF ASSESSEES BANK ACCOUNT. THE COPY OF BANK ACCOUNT IS APPEARING ON PAGE NO. 41 OF THE PAPER BOOK AS PER WHICH IT IS SEEN THAT THERE IS CREDIT ENTRY OF RS.1,50,000/ - ON 13/01/2007 BUT THERE IS DEBIT ENTRY OF THE SAME AMOUNT ON 22/01/2007. IN THE ABSENCE OF DETAILS REGARDING THIS DEBIT ENTRY, IT CANNOT BE ACCEPTED THAT THIS AMOUNT OF RS.1.50 LAC WAS EXISTING WITH THE ASSESSEE FOR INVESTMENT IN THE PARTNERSHIP BUSINESS OF SHRI RAM AGENCIES. MOREOVER, NO EVIDENCE HAS BEEN FURNISHED REGARDING CREDITWORTHINESS OF THE ASSESSEES FATHER. DURING THE YEAR, THE AS SESSEE HAS SHOWN CASH DEPOSIT IN HIS CAPITAL ACCOUNT OF RS.20,000/ - ON 01/10/2007. NO EXPLANATION HAS BEEN GIVEN REGARDING THE SOURCE OF THIS CASH DEPOSIT. CONSIDERING THE FACTS, AS DISCUSSED ABOVE, WE DO NOT FIND ANY REASON TO INTERFERE IN THE ORDER OF 6 CIT(A) BECAUSE THE ASSESSEE COULD NOT ESTABLISH THE SOURCE OF THIS CREDIT APPEARING IN THE CAPITAL ACCOUNT OF THE ASSESSEE. 11. REGARDING THE ADDITION MADE BY THE ASSESSING OFFICER ON ACCOUNT OF LOW HOUSE HOLD WITHDRAWALS, WE FIND THAT IT IS NOTED BY THE ASSESSING OFFICER ON PAGE NO. 8 OF THE ASSESSMENT ORDER THAT THE ASSESSEE HAS SHOWN TOTAL WITHDRAWAL OF RS.1.72 LAC OUT OF WHICH RS.1 LAC WAS INVESTED AND DEDUCTION U/S 80C WAS CLAIMED. HE HAS FURTHER NOTED THAT THEREFORE, THE NET WITHDRAWAL FOR HOUSE HOL D EXPENSES WAS RS. 0.72 LAC BUT OUT OF THIS ALSO, IT IS SEEN THAT NO DRAWING FROM THE CAPITAL ACCOUNT HAS BEEN MADE BY THE ASSESSEE UP TO 07/10/2007 I.E. FOR MORE THAN SIX MONTHS. THEREFORE, THE ASSESSING OFFICER HELD THAT WHEN RS.72,000/ - WAS SHOWN AS DRAWINGS IN THE SECOND HALF YEAR, THE SAME AMOUNT SHOULD HAVE BEEN SPENT BY THE ASSESSEE FOR HOUSE HOLD EXPENSES FOR FIRST HALF YEAR AND ON THIS BASIS, HE MADE ADDITION. NEITHER BE FORE CIT(A) NOR BEFORE US, THE ASSESSEE COULD SHOW THAT THERE WAS ANY SOURCE OF HOUSE HOLD EXPENSES DURING THE FIRST HALF YEAR OF THE PRESENT PREVIOUS YEAR. UNDER THESE FACTS, WE DO NOT FIND ANY REASON TO INTERFERE IN THE ORDER OF CIT(A) ON THIS ISSUE ALS O. 12. REGARDING THE TRIBUNAL DECISION CITED BY LEARNED A.R. OF THE ASSESSEE, WE FIND THAT IN THAT CASE, IT WAS HELD BY THE TRIBUNAL THAT IN THE ABSENCE OF ANY MATERIAL ON RECORD, THE ASSESSEES VERSION OF HOUSE HOLD EXPENSES COULD NOT BE DISCARDED AND NO ADDITION TO THE INCOME OF THE ASSESSEE COULD BE MADE. BUT IN THE PRESENT CASE, THE ASSESSEES VERSION OF HOUSE HOLD EXPENSES OF SECOND HALF YEAR IN THE PRESENT PREVIOUS YEAR HAS BEEN ACCEPTED BY THE AUTHORITIES BELOW AND SINCE THE ASSESSEE COULD NOT SHOW ANY SOURCE OF SIMILAR HOUSE HOLD EXPENSES IN THE FIRST HALF YEAR, THE ADDITION WAS MADE BY THE ASSESSING OFFICER AND CONFIRMED BY THE CIT(A). HENCE, THE FACTS OF THE PRESENT CASE ARE DIFFERENT AND THEREFORE, THIS 7 TRIBUNAL DECISION DOES NOT RENDER ANY HE LP TO THE ASSESSEE IN THE PRESENT CASE. ACCORDINGLY, GROUND NO. 3 IS REJECTED ON BOTH THE ISSUES. 13. GROUND NO. 4 IS GENERAL IN NATURE AND DOES NOT CALL FOR ANY SEPARATE ADJUDICATION. 14. IN THE RESULT, THE APPEAL OF THE ASSESSEE STANDS DISMISSED. 15. NOW WE TAKE UP THE APPEAL OF THE ASSESSEE FOR ASSESSMENT YEAR 2009 - 10 I.E. I.T.A. NO.234/LKW/2012. 16. GROUND NOS. 1 TO 3 ARE AS UNDER: 1. BECAUSE THE 'APPELLANT' COULD NOT HAVE BEEN HELD AND TREATED TO BE 'PERSON SUBJECTED TO SEARCH', THE ACIT, CENTRAL CIRCLE - L, LUCKNOW, COULD NOT HAVE ISSUED NOTICE UNDER SECTION 153A AND ASSESSMENT MADE THERE UNDER WAS LIABLE TO BE DECLARED AS NULL AND VOID. 2. BECAUSE THE 'CIT(A)' HAS ERRED IN LAW AND ON FACTS IN HOLDING THAT OBJECTION TO THE JURISDICTION OF T HE ASSESSING OFFICER (BASED ON THE GROUND THAT NO SEARCH UNDER SECTION 132(1) HAD BEEN CARRIED OUT IN HIS CASE), HAVING ALREADY BEEN ADJUDICATED UPON BY THE ASSESSING OFFICER, THE SAME COULD NOT HAVE BEEN RAISED IN APPEAL BEFORE HIM AND ON THAT REASONING, IN REJECTING THE APPELLANT'S PLEA TO THE VALIDITY OF ASSESSMENT ORDER DATED 28.12.2010 CAPTIONED AS 'ORDER UNDER SECTION 153A READ WITH SECTION 143(3)'. 3. BECAUSE THE ISSUE WENT TO THE VERY ROOT OF THE ASSESSMENT ORDER DATED 28.12.2010 AS HAD BEEN IMPUGN ED IN THE APPEAL BEFORE THE ID. FIRST APPELLATE AUTHORITY AND ON A DUE CONSIDERATION OF THE SAME AS ALSO THE MATERIAL AND INFORMATION AS WAS AVAILABLE ON RECORD, THE 'CIT(A)' SHOULD HAVE HELD THAT ASSESSMENT ORDER DATED 28.12.2010 WAS VOID - AB - INITIO. 8 17. BOTH THE SIDES AGREED THAT THE ISSUES INVOLVED IN THESE GROUNDS ARE IDENTICAL TO THE ISSUE INVOLVED IN GROUND NOS. 1 & 2 IN ASSESSMENT YEAR 2008 - 09 AND SAME CAN BE DECIDED ON SIMILAR LINE. IN THAT YEAR, THIS ISSUE WAS DECIDED AGAINST THE ASSESSEE BY FOLL OWING THE JUDGMENT OF HON'BLE A LLAHABAD HIGH COURT IN THE CASE OF CIT VS. DR A. K. BANSAL (INDIVIDUAL) [2013] 355 ITR 513 (ALL). ON THE SAME LINE, IN THE PRESENT YEAR ALSO, THIS ISSUE IS DECIDED AGAINST THE ASSESSEE AND THESE GROUNDS ARE REJECTED. 18. G ROUND NOS. 4 TO 6 ARE INTER - CONNECTED, WHICH READ AS UNDER: 4. BECAUSE 'CIT(A)' HAS ERRED IN LAW AND ON FACTS IN UPHOLDING THE ADDITION OF RS.3,99,570 / - AS HAD BEEN MADE IN THE ASSESSMENT ON ACCOUNT OF WASTE MATERIAL OF HARSINGAR GUTKHA PVT. LTD. OF WHIC H THE 'APPELLANT' HAS BEEN THE SELLING AGENT. 5. BECAUSE ON A DUE CONSIDERATION OF THE FACTS AND CIRCUMSTANCE OF THE CASE, AS WERE AVAILABLE ON RECORD, PARTICULARLY THAT; ( A ) SHRI K.N. SINGH PATEL IN HIS CAPACITY AS HEAD OF PATEL GROUP (NOMENCLATURE USED BY THE DEPARTMENT ITSELF) HAD GIVEN A STATEMENT UNDER SECTION 132(4) DURING THE COURSE OF SEARCH AND SEIZURE ACTION THAT HAD COMMENCED ON 19.11,2008, WHERE UNDER HE MADE A DISCLOSURE OF RS.60 LAKHS FOR THE YEAR UNDER CONSIDERATION; ( B ) ON THE BASIS OF RETURNS SO FILED BY SHRI K.N. SINGH PATEL, HIS ASSESSMENT FOR THE ASSESSMENT YEAR 2009 - 10 HAD DULY BEEN MADE ON SUBSTANTIVE BASIS; T HE AUTHORITIES BELOW WERE NOT JUSTIFIED EITHER ON FACTS OR IN LAW TO MAKE/UPHOLD THE SAID ADDITION, IN THE INDIVIDUAL ASSESSMENT OF TH E 'APPELLANT'. 6. BECAUSE THE 'APPELLANT'S' PLEA ABOUT NON - ASSESSABILITY OF THE SAID SUM OF RS.3,99,570 / - IN THE ASSESSMENT OF THE 'APPELLANT', HAS BEEN NEGATED BY THE 'CIT(A)', ON A WHOLLY WRONG PREMISE, WITH THE CONSEQUENCE THAT THE ADDITION MADE AND SU STAINED ALSO (FROM THE STAGE OF FIRST 9 APPELLATE AUTHORITY) IS ERRONEOUS ON FACTS AS WELL AS IN LAW. 19. LEARNED A.R. OF THE ASSESSEE REITERATED THE SAME CONTENTIONS WHICH WERE RAISED BEFORE CIT(A) WHEREAS LEARNED D.R. OF THE REVENUE SUPPORTED THE ORDER O F LEARNED CIT(A). 20. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. WE FIND THAT BEFORE THE ASSESSING OFFICER, THE ASSESSEE HAS GIVEN TWO EXPLANATIONS. FIRST EXPLANATION WAS THAT THE STOCK FOUND IN COURSE OF SEARCH WAS WASTE MATERIAL AND THEREFORE, NO ADDITION IS JUSTIFIED. THE SECOND EXPLANATION WAS THAT THEY VALUED THE STOCK AT RS.3,99,570/ - AND IT WAS SUBMITTED THAT THIS MAY BE TREATED AS PART OF RS.60 LACS SURRENDERED AGAINST THE STOCK BY SHRI K. N . SINGH PATEL. AFTER CONSIDERING THIS SUBMISSION, IT WAS HELD BY THE ASSESSING OFFICER THAT THE MATERIAL FOUND AT THE TIME OF SEARCH IS WASTE MATERIAL OR NOT CAN NOT BE VERIFIED AT THIS STAGE AND NO SUCH CONTENTION WAS RAISED EARLIER . REGARDING THE CLAIM OF RS.60 LAC SURRENDERED AGAINST STOCK, IT IS NOTED BY THE ASSESSING OFFICER TH AT SUCH SURRENDER WAS MADE BY HIM AGAINST THE STOCK OF PAL PAN PRIVATE LIMITED AND IN THIS MANNER, THE ASSESSING OFFICER REJECTED BOTH THE EXPLANATIONS OF THE ASSESSEE AND MADE THE ADDITION. ON THIS ISSUE, A CLEAR FINDING IS GIVEN BY CIT(A) IN PARA 9.2.2 OF HIS ORDER THAT SHRI K. N . SINGH PATEL IS NOT RELATED TO THE ASSESSEE AND AS PER THE PROVISION OF SECTION 292C, THE ASSESSEE WAS LIABLE TO EXPLAIN THE SOURCE OF THE STOCK FOUND IN HIS PREMISES AS HE WAS THE OWNER OF THE BUSINESS. HE HAS ALSO GIVEN A FI NDING THAT SHRI K. N . SINGH PATEL HAS NOWHERE OWNED UP THE ASSETS FOUND IN THE PREMISES OF THE ASSESSEE AND NO BENEFIT OF SET OFF CAN BE ALLOWED AGAINST THE AMOUNT SURRENDERED BY HIM AS NO SUCH SPECIFIC BIFURCATION APPEARS TO HAVE BEEN GIVEN BY SHRI K. N . SINGH PATEL. THESE FINDINGS OF CIT(A) COULD NOT BE CONTROVERTED BY LEARNED A.R. OF THE ASSESSEE AND THEREFORE, WE DO NOT FIND ANY REASON TO INTERFERE IN THE ORDER OF CIT(A). ACCORDINGLY, THESE GROUNDS ARE REJECTED. 10 21. GROUND NOS. 7 AND 8 ARE ALSO INTER - CONNECTED, WHICH READ AS UNDER: 7. BECAUSE 'CIT(A)' HAS ERRED IN LAW AND ON FACTS IN ESTIMATING THE HOUSEHOLD EXPENSES OF THE APPELLANT AT RS.2,34,000/ - AND IN SUSTAINING AN ADDITION OF RS.96,000/ - ON THAT SCORE. 8. BECAUSE THERE BEING NO MATERIAL AVAILABLE ON RECORD, SO AS TO LEAD TO THE DETERMINATION OF HOUSEHOLD EXPENSES AT RS.2,34,000/ - NO SUCH ADDITION COULD HAVE BEEN MADE/SUSTAINED BY THE AUTHORITIES BELOW. 22. BOTH THE SIDES AGREED THAT THE ISSUE INVOLVED IN THESE GROUNDS IS IDENTICAL TO TH E ISSUE RAISED BY THE ASSESSEE IN ASSESSMENT YEAR 2008 - 09 AND SAME CAN BE DECIDED ON SIMILAR LINE. 23. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. WE FIND THAT IT IS NOTED BY THE ASSESSING OFFICER ON PAGE NO. 3 OF THE ASSESSMENT ORDER THAT THE ASSESSEE HAS SHOWN TOTAL DRAWINGS OF RS.2.38 LACS OUT OF WHICH A SUM OF RS.1,00,000/ - HAS BEEN INVESTED BY THE ASSESSEE FOR WHICH DEDUCTION U/S 80C WAS CLAIMED. HE HAS FURTHER GIVEN A FINDING THAT ONLY AN AMOUNT OF RS.1.38 LAC WAS AVAILABLE WITH THE ASSESSEE WAS FOR HOUSE HOLD EXPENSES. HE HAS FURTHER NOTED THAT OUT OF THIS AMOUNT, THE FIRST WITHDRAWAL WAS MADE BY THE ASSESSEE ON 21/11/2008 AND THEREFORE, THE ASSESSEE HAS NOT MADE ANY DRAWINGS DURING FIRST EIGHT MONTHS AND THEREFORE, IT IS VERY LOGICAL TO ASSUME THAT THE ASSESSEES MONTHLY EXPENDITURE MUST HAVE BEEN MET BY HIM FROM SOME UNDISCLOSED SOURCES DURING THIS PERIOD. WHEN THE ASSESSEE IS SHOWING EXPENDITURE OF RS.1.38 LAC IN THE LAST 4 MONTHS, THE ESTIMATION OF THE ASSESSING OFFICER OF THE EXPENSES OF THE AS SESSEE AT RS.12,000/ - PER MONTH IS VERY MUCH REASONABLE AND THEREFORE, ADDITION MADE BY HIM OF RS.96,000/ - ON THIS BASIS OF ESTIMATED EXPENDITURE OF RS.12,000/ - PER MONTH FOR FIRST EIGHT MONTHS IS REASONABLE AND SINCE THE ASSESSEE COULD NOT SHOW 11 A NY SOURCE OF SUCH EXPENDITURE, WE DO NOT FIND ANY REASON TO INTERFERE IN THE ORDER OF CIT(A) ON THIS ISSUE ALSO. THESE GROUNDS ARE REJECTED. 24. IN THE RESULT, THE APPEAL OF THE ASSESSEE STANDS DISMISSED. 25. IN THE COMBINED RESULT, BOTH THE APPEALS OF THE ASSESSEE ARE DISMISSED. (ORDER WAS PRONOUNCED IN THE OPEN COURT ON THE DATE MENTIONED ON THE CAPTION PAGE) SD/. SD/. (SUNIL KUMAR YADAV) ( A. K. GARODIA ) JUDICIAL MEMBER ACC OUNTANT MEMBER DATED: 1 2 /02/2015 *C.L.SINGH COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT. 3. CONCERNED CIT 4. THE CIT(A) 5. D.R., I.T.A.T., LUCKNOW ASSTT. REGISTRAR