A.C.I.T., Circle-1, Gwalior V. Sh. Mukesh Kumar Jain, Gwalior

ITA 240/AGR/2011

• Counselvise Citation: 24020314 RSA 2011
• Duration Of Justice: 10 month(s) 10 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-05-2012
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 09-04-2012
• Assessment Year: 2008-2009
• Appeal Filed On: 24-06-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: V BAPNA
• Keywords: Rejection of books of accounts; Unexplained investment; Business expenditure; Assessment record

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AGRA BENCH, AGRA BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER AND SHRI A.L. GEHLOT, ACCOUNTANT MEMBER ITA NO.240/AGR/2011 ASSESSMENT YEAR: 2008-09 ASSTT. COMMISSIONER OF INCOME TAX, VS. SHRI M UKESH KUMAR JAIN, CIRCLE-1, GWALIOR. PROP. JAINA JEWELLERS, SARAFA BAZAR, LASHKAR, GWALIOR (M.P.). (PAN: ABWPJ 4620 L) (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI WASEEM ARSHAD, SR. D.R. RESPONDENT BY : SHRI V. BAPNA, C.A. DATE OF HEARING : 09.04.2012 DATE OF PRONOUNCEMENT : 04.05.2012 ORDER PER A.L. GEHLOT, ACCOUNTANT MEMBER: THIS IS AN APPEAL FILED BY THE REVENUE AGAINST THE ORDER DATED 14.03.2011 PASSED BY THE LD. CIT(A), GWALIOR FOR THE ASSESSMEN T YEAR 2008-09 ON THE FOLLOWING GROUNDS :- ITA NO.240/AGR/2011 A.YS. 2008-09 2 1. WHETHER ON THE FACTS AND IN THE LAW OF THE CASE THE CIT (APPEALS) HAS ERRED IN DELETING THE ADDITION OF ` 5,45,172/- ON ACCOUNT OF UNSECURED EXPENSES. 2. WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE CIT (APPEALS) HAS ERRED IN DELETING THE ADDITION OF ` 4,21,650/- ON ACCOUNT OF INTEREST EARNED ON HUNDIES. 3. WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE CIT (APPEALS) HAS ERRED IN DELETING THE ADDITION OF ` 3,95,06,207/- ON ACCOUNT OF GROSS PROFIT. 4. WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE CIT (APPEALS) HAS ERRED IN DELETING THE ADDITION OF ` 15,00,000/- ON ACCOUNT OF UNEXPLAINED INVESTMENT HUF PROPERTY AND UNDISCLOSED INCOME OF COMMISSION ON TENDU PATTA DEALING. 5. WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE CIT (APPEALS) HAS ERRED IN DELETING THE ADDITION OF ` 3,00,000/- ON ACCOUNT OF UNEXPLAINED HOUSE HOLD EXPENSES. 2. THE FIRST GROUND RAISED BY THE REVENUE IN ITS AP PEAL RELATES TO THE DELETION OF ADDITION OF ` 5,45,172/-. ON PERUSAL OF RECORDS, WE NOTICE THAT THE ASSESSEE DID NOT RAISE SUCH GROUND BEFORE THE CIT(A) AS IS EVIDENT F ROM COPY OF FORM NO.35 AVAILABLE ON RECORD. THIS FACT IS FURTHER SUPPORTE D BY THE ORDER OF CIT(A) AS THE CIT(A) DID NOT GIVE ANY SUCH FINDING IN HER ORDER. HOWEVER, IN THE BRIEF FACTS OF THE CASE, THE CIT(A) NOTED AS UNDER :- THE BRIEF FACTS OF THE CASE ARE THAT A SURVEY U/S 133A, WHICH HAS BEEN CONVERTED INTO SEARCH & SEIZURE OPERATIONS U/S 132, HAS BEEN CARRIED OUT AT THE BUSINESS AND RESIDENTIAL PREMISE S OF THE APPELLANT AND HIS FAMILY MEMBERS ON 20.02.08. DURING THE COU RSE OF SEARCH OPERATIONS, THE APPELLANT HAS MADE A DISCLOSURE OF ` 1,10,00,000/- ON ITA NO.240/AGR/2011 A.YS. 2008-09 3 ACCOUNT OF VARIATION IN STOCK ALONGWITH ` 4,45,172/- AND ` 1,00,000/- FOR UNRECORDED BUSINESS EXPENSES AND HOUSEHOLD EXPE NSES RESPECTIVELY. APPELLANTS BROTHER VIZ. SH. SUNIL J AIN HAS ALSO MADE SIMILAR DISCLOSURE OF ` 58,79,843/-. ACCORDINGLY, RETURN DECLARING INCOME OF ` 1,23,03,605/- INCORPORATING THE ABOVE MENTIONED DISCLOSURE HAS BEEN FILED BY THE APPELLANT ON 30.9. 09. THE APPELLANT HAS DECLARED SALE OF JEWELLERY AND VARIOUS ITEMS OF GOLD, SILVER ETC. AT ` 1,95,63,727/- ON WHICH GROSS PROFIT OF ` 26,24,861/- HAS BEEN SHOWN WHICH COMES TO 13.42% WHEREAS NET PROFIT OF ` 13,03,605/- HAS BEEN DECLARED. 3. SINCE THIS GROUND DOES NOT ARISE OUT OF THE ORDE R OF CIT(A) AS THE CIT(A) DID NOT DECIDE SUCH ISSUE, UNDER THE CIRCUMSTANCES, WE DO NOT FIND SUBSTANCE IN THE GROUND RAISED BY THE REVENUE. 4. GROUND NO.2 IS IN RESPECT OF DELETION OF ADDITIO N OF ` 4,21,650/- ON ACCOUNT OF INTEREST ON HUNDIES. THE CIT(A) DELETED THE SAI D ADDITION FOLLOWING HER ORDER FOR THE ASSESSMENT YEAR 2002-03. 5. LD. REPRESENTATIVES OF THE PARTIES SUBMITTED THA T THE ISSUE IS COVERED BY ASSESSEES OWN CASE FOR ASSESSMENT YEAR 2002-03 IN ITA NOS.262/AGR/2010 & OTHERS ORDER DATED 23.03.2012. 6. AFTER HEARING THE LD. REPRESENTATIVES OF THE PAR TIES, WE NOTICE THAT ON IDENTICAL SET OF FACTS THE I.T.A.T., AGRA BENCH IN ASSESSEES OWN CASE IN ITA ITA NO.240/AGR/2011 A.YS. 2008-09 4 NOS.262/AGR/2010 & OTHERS FOR ASSESSMENT YEAR 2002- 03 VIDE ORDER DATED 23.03.2012 HAS CONFIRMED THE ORDER OF CIT(A). THE RELEVANT FINDING OF THE I.T.A.T. IS REPRODUCED FROM PARAGRAPH NO.11 OF THE SAID ORDER AS UNDER:- 11. ANOTHER ADDITION OF RS.4,21,650/- IN CASE OF S HRI MUKESH KUMAR JAIN AND RS.1,01,700/- IN CASE OF SMT. BABITA JAIN WHICH WERE MADE BY THE ASSESSING OFFICER ON ACCOUNT OF INTERES T EARNED ON HUNDIES MENTIONED IN LPS PAGE 26 & 28 LOOSE PAPER FOUND AT THE TIME OF SEARCH, THE ASSESSING OFFICER CALCULATED TH E AMOUNT OF INTEREST APPLYING 18% RATE OF INTEREST ON RS.23,42,500/- ON PRESUMPTION THAT THE ASSESSEE HAS INVESTED THE AMOUNT MENTIONED IN L OOSE PAPER LPS PAGE 26 AND CALCULATED THE INTEREST FOR ALL THE SIX YEARS OF WHICH CALCULATION COMES TO RS.4,21,650/-. THE CIT(A) DEL ETED THE SAID ADDITIONS ON THE GROUND THAT THE ASSESSING OFFICER DID NOT MAKE ANY ENQUIRY FROM ANY OF THE PERSONS MENTIONED IN THE DO CUMENTS TO SHOW THAT THE ASSESSEE HAS EARNED INTEREST FROM AMOUNTS ALLEGED TO HAVE BEEN LENT. THE CIT(A) RELIED UPON THE JUDGMENT OF DELHI HIGH COURT IN THE CASE OF CIT VS. JUPITER BUILDERS PVT. LTD, 2 87 ITR 287 WHEREIN IT HAS BEEN HELD THAT THE ASSESSMENT PROCEEDINGS UN DER CHAPTER XIV-B ARE TAKEN ONLY IN RESPECT OF UNDISCLOSED INCOME WHI CH IS UNEARTHED AS A RESULT OF SEARCH. THE CIT(A) HAS FOLLOWED THIS O RDER FOR ASSESSMENT YEAR 2002-03 AND SUBSEQUENT ASSESSMENT YEARS 2003-0 4 TO 2007-08. AFTER CONSIDERING THE FACTS OF THE CASE, WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF CIT(A) AS THE ASSESSING OFFICER MADE T HE ADDITION ON PRESUMPTION BASIS. APART FROM THE FACT THAT AS PER DETAILED DISCUSSION MADE IN PARAGRAPH NOS.8 TO 10 ABOVE, WE HOLD THAT T HE LOOSE PAPER FOUND I.E. LPS-26 IS NOT PERTAINING TO THE ASSESSME NT YEAR 2002-03. THERE IS NO MATERIAL ON RECORD BASED ON WHICH IT CA N BE SAID THAT THE ASSESSEE WAS EARNING INTEREST ON THAT AMOUNT IN SUB SEQUENT YEAR FROM ASSESSMENT YEARS 2002-03 TO 2007-08. THEREFORE, NO TIONAL INCOME CANNOT BE TAXED IN THE FORM OF INTEREST. IN THE LI GHT OF THE ABOVE DISCUSSION, WE CONFIRM THE ORDER OF CIT(A) ON THE I SSUE. ITA NO.240/AGR/2011 A.YS. 2008-09 5 7. SINCE THE FACTS ARE IDENTICAL, FOLLOWING THE ABO VE ORDER OF I.T.A.T. IN ASSESSEES OWN CASE, WE CONFIRM THE ORDER OF THE CI T(A) FOR THIS YEAR ALSO. 8. GROUND NO.3 IS PERTAINING TO DELETION OF ADDITIO N OF ` 3,95,06,207/-. THE CIT(A) DELETED THE SAID ADDITION FOLLOWING HER ORDE R FOR ASSESSMENT YEAR 2002- 03. 9. LD. REPRESENTATIVES OF THE PARTIES SUBMITTED THA T THIS ISSUE IS ALSO COVERED BY ASSESSEES OWN CASE FOR ASSESSMENT YEAR 2002-03 IN ITA NOS.262/AGR/2010 & OTHERS ORDER DATED 23.03.2012. 10. AFTER HEARING THE LD. REPRESENTATIVES OF THE P ARTIES, WE NOTICE THAT ON IDENTICAL SET OF FACTS THE I.T.A.T., AGRA BENCH IN ASSESSEES OWN CASE IN ITA NOS.262/AGR/2010 & OTHERS FOR ASSESSMENT YEAR 2002- 03 VIDE ORDER DATED 23.03.2012 HAS CONFIRMED THE ORDER OF CIT(A). THE RELEVANT FINDING OF THE I.T.A.T. IS REPRODUCED FROM PARAGRAPH NOS.13 TO 16 OF THE SAID ORDER AS UNDER:- 13. THE BRIEF FACTS OF THE ISSUE ARE THAT DURING T HE ASSESSMENT PROCEEDINGS THE ASSESSING OFFICER ASKED THE ASSESSE E TO FURNISH DETAILS OF SALES AND PURCHASES ITEM- WISE, QUANTITY-WISE AN D QUALITY-WISE WITH VALUATION AND G.P. RATE ITEM-WISE, PURCHASE AND SAL ES, OPENING STOCK AND CLOSING STOCK ITEMS-WISE, QUANTITY-WISE, QUALIT Y-WISE, RATE APPLIED FOR EACH ITEM WITH SUPPORTING DOCUMENTS, PURITY AND STOCK REGISTER. ITA NO.240/AGR/2011 A.YS. 2008-09 6 THE ASSESSEE DID NOT FURNISH THE REQUIRED DETAILS. IN ABSENCE OF THE DETAILS, THE ASSESSING OFFICER WAS OF THE VIEW THAT THE BOOKS OF ACCOUNT OF THE ASSESSEE REMAINED UNVERIFIABLE AND U NRELIABLE. ASSESSING OFFICER REJECTED THE BOOKS OF ACCOUNTS. AFTER REJECTING THE BOOKS OF ACCOUNTS, THE ASSESSING OFFICER NOTICED TH AT THE ASSESSEE HAS DECLARED NET PROFIT OF RS.1,07,815/- ON SALE OF RS. 42,68,564/- ON WHICH CALCULATION OF G.P. COMES TO 8.04% IN ASSESSM ENT YEAR 2002- 03. THE ASSESSING OFFICER ALSO EXAMINED STOCK TURN OVER RATIO WHICH WAS 1:12 AND NOTED THAT IN THIS LIME OF BUSINESS G. P. IS ESTIMATED AT 22%. THE ASSESSEE HAS NOT GIVEN PROPER EXPLANATION REGARDING THE G.P. DECLARED BY THE ASSESSEE. THE ASSESSING OFFIC ER ACCORDINGLY CALCULATED G.P. OF RS.76,08,400/- AS AGAINST G.P. D ECLARED BY THE ASSESSEE OF RS.1,07,815/- AND MADE ADDITION OF RS.7 5,00,585/- IN ASSESSMENT YEAR 2002-03. IN ASSESSMENT YEAR 2003-0 4 THE ADDITION MADE BY THE ASSESSING OFFICER IS RS.85,16,304, IN A SSESSMENT YEAR 2004-05 THE ADDITION MADE BY THE ASSESSING OFFICER IS RS.97,64,301/-, IN ASSESSMENT YEAR 2005-06 THE ADDITION MADE BY THE ASSESSING OFFICER IS RS.78,29,677/-, IN ASSESSMENT YEAR 2006- 07 THE ADDITION MADE BY THE ASSESSING OFFICER IS RS.1,38,97,663/- A ND IN ASSESSMENT YEAR 2007-08 THE ADDITION MADE BY THE ASSESSING OFF ICER IS RS.1,43,60,534/-. 14. THE CIT(A) UPHELD THE ACTION OF THE ASSESSING O FFICER FOR REJECTION OF BOOKS OF ACCOUNT OBSERVING THAT THERE IS NO DENYING THE FACTS THAT SOME DEFICIENCY AND DEFECTS HAVE BEEN FO UND IN MAINTENANCE OF BOOKS OF ACCOUNT DURING THE COURSE OF SEARCH AND ON THAT ACCOUNT THE ASSESSEE MADE DISCLOSURE OF RS.1,10,00,000/- FO R VARIATION IN STOCK ALONG WITH DISCLOSURE OF RS.4,45,172/- AND RS.1,00, 000/- FOR UNRECORDED BUSINESS EXPENDITURE AND HOUSE HOLD EXPE NSES. HOWEVER, IN RESPECT OF ESTIMATION OF G.P., THE CIT(A) DID NO T AGREE WITH THE ASSESSING OFFICER ON THE GROUND THAT THE ASSESSING OFFICER FIRST ESTIMATED THE SALES ON STOCK TURNOVER RATIO FOR WHI CH NO BASIS HAS BEEN GIVEN AND THEN HAS FURTHER ESTIMATED THE PROBA BLE G.P. AGAIN WITHOUT ANY BASIS. THE DISCLOSURE HAS BEEN MADE AND ACCEPTED AFTER COMPLETE PROCESSING OF DOCUMENTS FOUND AND SEIZED D URING THE COURSE OF SEARCH. THEREFORE, THE ASSESSING OFFICER WAS NO T JUSTIFIED IN MAKING FURTHER ADDITION ON ESTIMATE BASIS WITHOUT A NY SUPPORTING DOCUMENTS OR MATERIAL ON RECORD. THE CIT(A) FOLL OWED THE REASONS MENTIONED BY HIM IN ANOTHER CASE I.E. IN THE CASE O F SUNIL JAIN, BROTHER OF THE ASSESSEE IN AN APPEAL FOR THE ASSESS MENT YEAR 2008-09. ITA NO.240/AGR/2011 A.YS. 2008-09 7 THE CIT(A) FOLLOWED HIS REASONING AND ORDER FOR ASS ESSMENT YEAR 2002-03 IN ALL SUBSEQUENT YEARS. THE RELEVANT FIND ING OF THE CIT(A) IS REPRODUCED FROM PARAGRAPH NO.5.3 AT PAGE NO.10 OF H IS ORDER AS UNDER :- 5.3 THERE IS NO DENYING THE FACT THAT SOME DEFICIE NCIES AND DEFECTS HAVE BEEN FOUND IN THE MAINTENANCE OF B OOKS OF ACCOUNTS DURING THE COURSE OF SEARCH FOR WHICH T HE APPELLANT HAS DULY MADE THE DISCLOSURE OF RS.1,10,00,000/- FOR VARIATION IN STOCK ALONGWITH A DISCLOSURE OF RS.4,45,172/- AND RS.1,00,000/- FOR UNRECORDED BUSINESS EXPENSES AND HOUSEHOLD EXPENSES RESPECTIVELY. THE SAME HAS BEEN ACCEPTED BY THE A. O. WHICH IS EVIDENT FROM THE STATEMENT OF THE APPELLA NT RECORDED ON 25.02.08 AND 26.02.08 WHERE IN RESPONSE TO QUESTION NO.23 AND ITS REPLY MAKING THE DISCLOSURE AS ABOVE, THE APPELLANT HAS BEEN ASKED TO GIVE THE MO DE OF TAX PAYMENT ON THE DISCLOSURE MADE. AS NOTED ABOVE IN THE ASSESSMENT ORDER THE A.O. HAS MADE ESTIMATES IN STAGES WHICH TANTAMOUNT TO REWRITING THE SEIZED MAT ERIAL AND DISCLOSURE. THE A.O. HAS FIRST ESTIMATED THE S ALES ON A STOCK TURNOVER RATIO FOR WHICH NO BASIS HAS BEEN GIVEN AND THEN HAS FURTHER ESTIMATED THE PROBABLE G.P., A GAIN WITHOUT ANY BASIS. SEIZED MATERIAL HAS TO BE READ AND ACCEPTED AS A WHOLE. IT IS NOT PERMISSIBLE TO PICK AND CHOOSE OR MAKE FURTHER ESTIMATE THEREFROM UNLESS AN D UNTIL THERE IS COGENT MATERIAL IN SUPPORT OF UNDERT AKING SUCH AN EXERCISE. THE DISCLOSURE HAS BEEN MADE AND ACCEPTED AFTER COMPLETE PROCESSING OF DOCUMENTS FOU ND AND SEIZED DURING THE COURSE OF SEARCH. THE A.O. W AS NOT JUSTIFIED IN MAKING FURTHER ADDITION ON ESTIMATE BA SIS WITHOUT ANY SUPPORTING DOCUMENT OR MATERIAL ON RECO RD. FOR THE REASONS MENTIONED BY ME IN THE CASE OF SHRI SUNIL JAIN, BROTHER OF THE APPELLANT, IN THE APPEAL FOR T HE A.Y. 08-09 (APPEAL NO.205/IT/09-10/GWL), THE ACTION OF T HE A.O. FIRST IN ESTIMATING THE SALES AND THEN ESTIMAT ING THE PROBABLE G.P. THEREON @ 22% WITHOUT ANY COGENT AND SUPPORTIVE EVIDENCE ON RECORD IS NOT FOUND JUSTIFIA BLE. ADDITION OF RS.75,00,585/- IS HEREBY DELETED. ITA NO.240/AGR/2011 A.YS. 2008-09 8 15. WE HAVE HEARD THE LD. REPRESENTATIVES OF THE PA RTIES AND RECORDS PERUSED. WE FIND THAT AFTER CONFIRMING THE ACTION OF ASSESSING OFFICER IN RESPECT OF REJECTION OF BOOKS OF ACCOUNT , THE CIT(A) NOTED ON MERIT THAT THE ASSESSING OFFICER HAS FIRST ESTIM ATED THE SALES ON A STOCK TURNOVER RATIO FOR WHICH NO BASIS HAS BEEN GI VEN. FURTHER HE APPLIED PROBABLE G.P. WITHOUT ANY BASIS. THE CIT(A ) RELIED UPON THE REASONS GIVEN BY HIM IN CASE OF SHRI SUNIL JAIN WHO SE APPEAL HAS BEEN DECIDED BY I.T.A.T. VIDE ITA NO.161/AGR/2010 ORDER DATED 10.03.2011 CONFIRMING THE ORDER OF CIT(A). THE FINDING OF THE I.T.A.T. IS REPRODUCED BELOW: 8. AS REGARDS TO THE APPEAL FIELD BY THE REVENUE I N WHICH THE REVENUE HAS CONTENDED THAT THE LD. FIRST APPELLATE AUTHORITY HAS WRONGLY ACCEPTED THE BOOKS WHEN PURCHASES ARE NOT SUPPORTED BY BILLS AND INVOI CES OR OTHER SUPPORTING DOCUMENTS WHICH ARE MOSTLY FROM UNREGISTERED DEALERS AND GIVING RELIEF TO THE ASSES SEE FOR ` 1,92,83,893/- (REDUCING G.P. ADDITION TO ` 7,00,000/-) AS AGAINST THE ADDITION OF ` 1,99,83,893/- MADE ON ACCOUNT OF ESTIMATED G.P. THE LD. FIRST APPELLATE AUTHORITY HAS CLEARLY MENTIONED IN THE IMPUGNED ORD ER THAT THIS IS THE FIRST YEAR OF OPERATION OF THE ASS ESSEES BUSINESS AND HE HAS DECLARED SALES OF ` 78,68,534/- ON WHICH G.P. OF ` 11,99,728/- HAS BEEN EARNED THEREBY GIVING G.P. RATE OF 15.24% AND THE ASSESSING OFFICE R HAS ESTIMATED THE SAME @ 22% WITHOUT GIVING ANY BASIS F OR THE SAME. THE LD. FIRST APPELLATE AUTHORITY HAS AL SO SUPPORTED HER VIEW BY THE DECISION OF HONBLE DELHI HIGH COURT IN THE CASE OF CIT, DELHI-I VS. BANSAL H IGH CARBONS (P) LTD (2007) 165 TAXMAN 243. THE LD. FI RST APPELLATE AUTHORITY WHILE DELETING THE ADDITION IN DISPUTE IN THE APPEAL FILED BY THE REVENUE HERSELF HAS HELD THAT THERE ARE SOME DEFICIENCIES AND DEFECTS IN MAINTENA NCE OF BOOKS OF ACCOUNTS BY THE ASSESSEE DURING THE COURSE OF SEARCH FOR WHICH THE ASSESSEE HAS MADE DISCLOSURE O F ` 58,79,843/- FOR VARIATION IN STOCK, CASH, HOUSEHOLD EXPENSES AND BUSINESS EXPENSES WHICH HAS BEEN ACCEP TED BY THE ASSESSING OFFICER AND DELETED THE REMAINING ADDITION IN DISPUTE. AFTER GOING THROUGH THE IMPUG NED ITA NO.240/AGR/2011 A.YS. 2008-09 9 ORDER, WE ARE OF THE CONSIDERED OPINION THAT THE LD . FIRST APPELLATE AUTHORITY HAS RIGHTLY DELETED THE ADDITIO N IN DISPUTE IN THE APPEAL FILED BY THE REVENUE ON THE B ASIS OF DOCUMENTARY EVIDENCE FILED BY THE ASSESSEE AS WELL AS THE DISCLOSURE STATEMENT MADE BY THE ASSESSEE DURING TH E SEARCH WHICH HAS BEEN ACCEPTED BY THE ASSESSING OFF ICER. KEEPING IN VIEW THE FACTS AND CIRCUMSTANCES OF THE PRESENT CASE, WE ARE OF THE CONSIDERED OPINION THAT NO INTERFERENCE IS CALLED FOR IN THE WELL REASONED ORD ER PASSED BY THE LD. FIRST APPELLATE AUTHORITY. WE UP HOLD THE SAME BY DISMISSING THE APPEAL FILED BY THE REVE NUE. 16. SINCE ON IDENTICAL SET OF FACTS THE I.T.A.T. IN CASE OF SHRI SUNIL JAIN WHILE DISCUSSING GROUND OF APPEAL OF REVENUE C ONFIRMED THE ORDER OF CIT(A). TO MAINTAIN CONSISTENCY, WE FOLLO W THE ORDER OF I.T.A.T. CITED SUPRA AND IN THE LIGHT OF FACTS, WE CONFIRM THE ORDER OF CIT(A) ON THIS ISSUE. 11. WE NOTICE THAT ON IDENTICAL SET OF FACTS, THE I .T.A.T. HAS CONFIRMED THE ORDER OF THE CIT(A) WHERE ADDITION HAS BEEN DELETED IN TH AT YEAR. FOLLOWING THE SAID ORDER OF I.T.A.T. IN ASSESSEES OWN CASE, THE ORDER OF CIT(A) FOR THIS YEAR IS ALSO CONFIRMED. 12. GROUND NO.4 IS IN RESPECT OF ADDITION OF RS.17, 00,000/-. DURING THE ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER NOTIC ED THAT MUKSH KUMAR JAIN HAS ADMITTED DURING THE COURSE OF SEARCH THAT MUKESH KU MAR HUF HAS INCOME FROM COMMISSION OF TENDU PATTA DEALING & PROPERTY DEALIN G. HE FURTHER ADMITTED TO HAVE INVESTED ` 7,00,000/- IN PROPERTY FOR HUF. THE ASSESSING OFF ICER MADE ITA NO.240/AGR/2011 A.YS. 2008-09 10 ADDITION ON PROTECTIVE BASIS ON THE GROUND THAT INC OME BELONGS TO MUKESH KUMAR JAIN. THE ASSESSING OFFICER ESTIMATED THE COMMISSI ON INCOME FROM TENDU PATTA DEALING AT ` 5,00,000/- ALONG WITH COMMISSION FROM PROPERTY DEA LING AT ANOTHER ` 5,00,000/-, WHEREAS, INVESTMENT IN PURCHASE OF PROP ERTY AT ` 7,00,000/- HAS BEEN ASSESSED IN THE HANDS OF THE ASSESSEE SOLELY ON THE REASON THAT NO DOCUMENTARY EVIDENCE REGARDING THESE AMOUNTS WERE SUBMITTED BY THE ASSESSEE. THE CIT(A) RESTRICTED THE ADDITION TO THE EXTENT OF ` 2,00,000/- AS UNDER :- (CIT(A) PARA NOS.5.2 & 5.3) 5.2 APPELLANTS SUBMISSIONS ALONGWITH ASSESSMENT O RDER HAVE BEEN CONSIDERED CAREFULLY. ASSESSMENT RECORDS HAVE ALSO BEEN PERUSED. A.O. HAS MADE ESTIMATED ADDITION ON PROTECTIVE BASI S IN CASE OF THE APPELLANT BY ESTIMATING COMMISSION INCOME FROM TEND U PATTA DEALING AT ` 5,00,000/- ALONGWITH COMMISSION FROM PROPERTY DEALI NG AT ANOTHER ` 5,00,000/- WHEREAS INVESTMENT IN PURCHASE OF PROPER TY AT ` 7,00,000/- HAS ALSO BEEN ASSESSED IN THE HANDS OF T HE APPELLANT SOLELY ON THE REASON THAT NO DOCUMENTARY EVIDENCE REGARDIN G THESE AMOUNTS HAS BEEN SUBMITTED BY THE APPELLANT. IT IS SEEN FR OM RECORDS THAT VIDE SALE DEED DATED 18.9.07, SHOP NO.8 MEASURING 35.62 SQ. METER AT STATION ROAD HAS BEEN PURCHASED BY MUKESH JAIN, HUF THROUGH ITS KARTA SHRI MUKESH JAIN I.E. THE APPELLANT FROM SHRI ASHOK JAIN FOR ` 7,00,000/-. THE SAME HAS BEEN REGISTERED IN THE NA ME OF HUF ON 12.12.07. PAYMENT FOR THE SAID PROPERTY HAS BEEN M ADE FROM THE BANK ACCOUNT NO.0291000100207480 OF THE HUF AT PNB, MORA R BY WITHDRAWALS MADE ON 9.8.07 AND 24.8.07. THE SAID H UF IS ALSO REGULAR INCOME TAX PAYER HAVING PAN AAFHM 7610D. T HE SAID PROPERTY IS ALSO FOUND DISCLOSED IN THE BALANCE SHE ET OF THE HUF AS ON 31.03.08. NO SUBSTANTIVE ADDITION IS MADE IN CASE OF THE CONCERNED HUF. THUS, THE ASSESSING OFFICER IS NOT JUSTIFIED IN TREATING THE INVESTMENT IN PROPERTY/SHOP AT ` 7,00,000/- IN THE HANDS OF THE APPELLANT ON PROTECTIVE BASIS WITHOUT ANY EVIDENCE ON RECORDS WHEN NO ADVERSE INFERENCE HAS BEEN DRAWN IN CASE OF THE HUF. ITA NO.240/AGR/2011 A.YS. 2008-09 11 5.3 ADDITION OF ` 5,00,000/- EACH ON COMMISSION FROM TENDU PATTA AND PROPERTY DEALING HAS BEEN MADE IN ABSENCE OF AN Y DOCUMENTARY EVIDENCE REGARDING INCOME EARNED THEREFROM AND EXPE NSES INCURRED THEREON. AS PER HIS RETURN, THE APPELLANT HAS NOT DECLARED ANY INCOME FROM OTHER SOURCES WHEREAS INCOME OF ` 1,23,03,605/- HAS BEEN SHOWN FROM PROFITS AND GAINS FROM BUSINESS OF SALE/ PURCHASE OF JEWELLERY. AS PER HIS STATEMENT RECORDED ON 20.2.0 8, THE APPELLANT HAS STATED IN RESPONSE TO QN. NOS.103 TO 128 WHEREBY HE HAS ADMITTED OF CARRYING OUT THE WORK OF COMMISSION FROM TENDU PATT A DEALING AND PROPERTY DEALING ON BEHALF OF MUKESH JAIN, HUF. HO WEVER, HE HAS NOT BEEN ABLE TO GIVE ANY SATISFACTORY REPLY REGARD ING COMMISSION EARNED FROM THESE TWO SOURCES. EVEN DURING THE COU RSE OF ASSESSMENT OR APPEAL PROCEEDINGS, NO DOCUMENTARY EVIDENCE REGA RDING COMMISSION INCOME FROM THESE SOURCES HAS BEEN FURNI SHED. IN FACT, APPELLANTS SUBMISSIONS ON GROUND NO.3, BY WHICH TH E SAID ADDITION HAS BEEN CONTESTED AND WHICH HAVE BEEN REPRODUCED A S ABOVE, ARE FOUND TO BE SILENT ON THIS ISSUE. THUS, A.O. IS FO UND JUSTIFIED IN ESTIMATING COMMISSION INCOME FROM TENDU PATTA DEALI NG AND PROPERTY DEALING WHICH HAS BEEN SHOWN NEITHER IN THE APPELLA NTS RETURN NOR IN THE HUF ON THE BASIS OF STATEMENT OF THE APPELLANT HIMSELF. SINCE NO CASE HAS BEEN MADE OUT THAT THE SAID STATEMENT HAS BEEN MADE UNDER MISTAKEN BELIEF OF FACT OR LAW AND THE STATEMENT BE ING VOLUNTARY ONE, THERE IS NO SCOPE FOR THE APPELLANT TO CHALLENGE IT S CORRECTNESS. THUS, THE DISPUTE ESSENTIALLY REVOLVES AROUND QUANTUM OF SUCH ESTIMATED INCOME. THERE IS ALWAYS AN ELEMENT OF SUBJECTIVITY IN ESTIMATION. SINCE THE APPELLANT HAS NOT GIVEN ANY BASIS AND IS TOTALLY LACKING OF BONAFIDES IN RESPECT OF COMMISSION INCOME, A.O. IS FOUND FULLY JUSTIFIED IN SUBSTITUTING HIS ESTIMATE IN RESPECT O F COMMISSION INCOME EARNED BUT NOT DECLARED. HOWEVER, CONSIDERING THE FACTS OF THE CASE AND VOLUNTARY DISCLOSURE MADE BY THE APPELLANT, SUC H ESTIMATE OF NET COMMISSION INCOME AT ` 2,00,000/- IS FOUND REASONABLE AND JUSTIFIED IN CASE OF THE APPELLANT ON SUBSTANTIVE BASIS. ACC ORDINGLY, ADDITION OF ` 2,00,000/- OUT OF ` 10,00,000/- MADE BY THE A.O. IS CONFIRMED. APPELLANT THUS GETS RELIEF OF ` 15,00,000/- ON THIS GROUND ACCORDINGLY. 13. WE HAVE HEARD THE LD. REPRESENTATIVES OF THE PA RTIES AND RECORDS PERUSED. WE NOTICE THAT THE CIT(A) HAS RIGHTLY HELD THAT THE ASSESSING OFFICER WAS NOT ITA NO.240/AGR/2011 A.YS. 2008-09 12 JUSTIFIED IN TREATING THE INVESTMENT IN PROPERTY/SH OP AT RS.7,00,000/- IN THE HANDS OF THE ASSESSEE ON PROTECTIVE BASIS AS NO EVIDENCE ON RECORD WAS FOUND. THE CIT(A) NOTED THE FACT AFTER VERIFICATION OF RECORDS THAT S HOP NO.8 WAS PURCHASED BY MUKESH KUMAR JAIN, HUF THROUGH ITS KARTA MUKESH KUMAR JAIN FROM SHRI ASHOK JAIN FOR ` 7,00,000/-. THE SHOP WAS ALSO REGISTERED IN THE NA ME OF HUF ON 12.12.2007. THE PAYMENT OF PROPERTY ` 7,00,000/- WAS MADE THROUGH BANKING CHANNEL. HUF I S ALSO A REGULAR INCOME TAX PAYER HAVING PAN AAFHM 76 10D. THE HUF HAS SHOWN THE SAID PROPERTY IN THEIR BALANCE SHEET AS O N 31.03.2008. THE CIT(A) HAS ALSO NOTED THAT NO SUBSTANTIVE ADDITION HAS BEEN MA DE IN THE HANDS OF HUF. THEREFORE, THE PROTECTIVE ADDITION IN THE HANDS OF THE ASSESSEE DOES NOT SURVIVE. IN THE LIGHT OF THE FACT RECORDED BY THE CIT(A) AS DIS CUSSED ABOVE, WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF CIT(A). 14. AS REGARDS THE ADDITION OF RS.5,00,000/-, THE C IT(A) FOUND THAT IT IS AN ESTIMATION OF COMMISSION INCOME AND AFTER CONSIDERI NG THE FACTS OF THE CASE THE CIT(A) FOUND THAT THE ESTIMATION OF NET COMMISSION INCOME TO THE EXTENT OF ` 2,00,000/- IS REASONABLE AND JUSTIFIED. CONTRARY T O THE FINDING OF CIT(A) THE REVENUE HAS FAILED TO POINT OUT ANY MATERIAL BASED ON WHICH A DIFFERENT ESTIMATION OF ADDITION CAN BE MADE. IN THE LIGHT OF THE FACT, WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF CIT(A). ORDER OF THE CIT(A) IS CONFIRMED ON THE ISSUE. ITA NO.240/AGR/2011 A.YS. 2008-09 13 15. GROUND NO.5 IS IN RESPECT OF DELETION OF ADDITI ON OF ` 3,00,000/- ON ACCOUNT OF HOUSE HOLD EXPENSES. THE CIT(A) DELETED THE ADD ITION AFTER DETAILED DISCUSSION ON THE ISSUE IN PARAGRAPH NOS.6.2 & 6.3. THE CIT(A ) RECORDED THE FACT THAT NO MATERIAL HAS BEEN BROUGHT ON RECORD TO SHOW THAT TH E ASSESSEE HAS INCURRED MORE EXPENDITURE THAN DECLARED OR THAT THE EXPENDITURE H AS BEEN MADE OUT OF BOOKS OF ACCOUNT. INSPITE OF THE FACT, NO SUCH MATERIAL WAS FOUND AT THE TIME OF SEARCH. THE ASSESSEE HAS SHOWN TOTAL HOUSE HOLD EXPENSES OF ` 1,55,000/- OUT OF THIS ` 45,000/- HAS BEEN MET BY SMT. BABITA JAIN. THE ASSESSING OF FICER DID NOT MAKE ANY ENQUIRY WITH REFERENCE TO SPECIFIC ITEM OF HOUSE HO LD EXPENSES. ADDITION MADE BY THE ASSESSING OFFICER IS ON ESTIMATION BASIS. U NDER THE FACTS AND CIRCUMSTANCES, WE FIND THAT THE CIT(A) HAS RIGHTLY DELETED THE ADD ITION CONSIDERING THE FACT THAT THE ASSESSEE HAS DECLARED HOUSE HOLD EXPENSES AT ` 1,55,000/-. IN THE LIGHT OF THE FACT, ORDER OF THE CIT(A) IS CONFIRMED. 16. IN THE RESULT, APPEAL FILED BY THE REVENUE IS D ISMISSED. (ORDER PRONOUNCED IN THE OPEN COURT ON 04.05.2012) SD/- SD/- (BHAVNESH SAINI) (A.L. GEHLOT) JUDICIAL MEMBER ACCOUNTANT MEMBER DATE: 4 TH MAY, 2012 ITA NO.240/AGR/2011 A.YS. 2008-09 14 PBN/* COPY OF THE ORDER FORWARDED TO: APPELLANT RESPONDENT CIT CONCERNED CIT (APPEALS) CONCERNED D.R., ITAT AGRA BENCH, AGRA GUARD FILE. BY ORDER SR. PRIVATE SECRETARY INCOME-TAX APPELLATE TRIBUNAL, AGRA TRUE COPY