Ramesh Chand, V. ITO Ward-I,

ITA 2505/DEL/2006

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 4596 (ITAT-DELHI)
• Duration Of Justice: 11 year(s) 2 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-09-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 07-06-2017
• Assessment Year: 2003-2004
• Appeal Filed On: 19-07-2006
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: DR RAKESH GUPTA; SOMIL AGARWAL S
• Keywords: Opportunity of being heard; Principle of natural justice
• Section: 145

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES C : DELHI BEFORE SHRI B.P. JAIN, ACCOUNTANT MEMBER AND SHRI KULDIP SINGH, JUDICIAL MEMBER ITA.NO.2505/DEL./2006 ASSESSMENT YEAR 2003-2004 RAMESH CHAND PROP. INCOME TAX OFFICER M/S. RAMESH CHAND VS. WARD-1, NARNAUL PREM CHAND, NEW MANDI, NARNAUL (APPELLANT) (RESPONDENT) ASSESSEE BY : DR. RAKES H GUPTA, & S HRI SOMIL AGARWAL, ADVOCATES REVENUE BY : SHRI ARUN KUMAR YADAV, SR. DR DATE OF HEARING : 22.08.2017 DATE OF ORDER : 19.09.2017 ORDER PER KULDIP SINGH, JUDICIAL MEMBER : APPELLANT, THE PROPRIETOR OF M/S. RAMESH CHAND PRE M CHAND, NARNAUL BY FILING THE PRESENT APPEAL SOUGHT TO SET ASIDE THE IMPUGNED ORDER DATED 25.4.2006 PASSED BY THE COMMISSIONER OF INCOME-TAX (APPEALS), ROHTAK FOR THE ASSTT. YEAR 2003-04 ON THE GROUNDS INTERALIA THAT :- 1. THAT HAVING REGARD TO THE FACTS AND CASE, LD. CIT (A) (A) HAS ERRED IN LAW AND ON FACTS IN CONFIRMING THE ACTION OF LD. A.O. IN REJECTING THE BOOKS OF ACCOUNTS BY APPL YING THE 2 ITA.NO.2505/DEL./2006 SHRI RAMESH CHAND VS. ITO PROVISIONS OF SECTION 145 AND THAT TOO WITHOUT ANY BASIS, MATERIAL OR EVIDENCE AND BY RECORDING INCORRECT FAC TS AND FINDINGS AND THAT TOO WITHOUT GIVING AN ADEQUATE OP PORTUNITY OF BEING HEARD. 2. THAT HAVING REGARD TO THE FACTS AND CIRCUMSTANC ES OF THE CASE. LD. CIT (A) HAS ERRED IN LAW AND ON FACTS IN CONFIRMING THE ACTION OF LD. A.O IN MAKING AN ADDITION OF RS. 110/-ON ACCOUNT OF ALLEGED PURCHASE OF BAJRA FROM MR. MOHA N LAL GUPTA AND ALLEGED PROFIT ON SALE OF SUCH BAJRA WITH OUT ANY BASIS, MATERIAL OR EVIDENCE AND BY RECORDING INCORR ECT FACTS AND FINDINGS AND THAT TOO WITHOUT GIVING AN ADEQUAT E OPPORTUNITY OF BEING HEARD. 3. THAT HAVING REGARD TO THE FACTS AND CIRCUMSTANC ES OF THE CASE, LD. CIT(A) HAS ERRED IN LAW AND ON FACTS IN C ONFIRMING THE ACTION OF LD. A.O. IN MAKING AN ADDITION OF RS. 50,300/- ON ACCOUNT OF ALLEGED DIFFERENCE IN THE BALANCE OF M/S. RATTAN IRON STORE WITHOUT ANY BASIS, MATERIAL OR EV IDENCE AND BY RECORDING INCORRECT FACTS AND FINDINGS AND T HAT TOO WITHOUT GIVING AN ADEQUATE OPPORTUNITY OF BEING HEA RD. 4. THAT HAVING REGARD TO THE FACTS AND CIRCUMSTANCE S OF THE CASE. LD. CIT (A) HAS ERRED IN LAW AND ON FACTS IN CONFIRMING THE ACTION OF LD. A.O. IN MAKING ADDITIONS OF RS. 1 2,317/- ON ACCOUNT OF ALLEGED BALANCE OF THREE BANK ACCOUNTS W ITHOUT ANY BASIS, MATERIAL OR EVIDENCE AND BY RECORDING IN CORRECT FACTS AND FINDINGS AND THAT TOO WITHOUT GIVING AN A DEQUATE OPPORTUNITY OF BEING HEARD. 5. THAT HAVING REGARD TO THE FACTS AND CIRCUMSTANCE S OF THE CASE, LD. CIT (A) HAS ERRED IN LAW AND ON FACTS IN CONFIRMING THE ACTION OF LD. A.O. IN MAKING ADDITIO NS OF RS. 7,549/- ON ACCOUNT OF ALLEGED PROFIT BY CONSIDERING THE DEPOSITS IN THE BANK ACCOUNT OF M/S SATYA NARAIN DI NESH KUMAR AS SALE PROCEEDS OF THE APPELLANT BY TREATING THE SAID FIRM AS BENAMI OF THE APPELLANT WITHOUT ANY BASIS, MATERIAL OR EVIDENCE AND BY RECORDING INCORRECT FACTS AND FI NDINGS AND THAT TOO WITHOUT GIVING AN ADEQUATE OPPORTUNITY OF BEING HEARD. 6. THAT HAVING REGARD TO THE FACTS AND CIRCUMSTANCE S OF THE CASE, LD. CIT (A) HAS ERRED IN LAW AND ON FACTS IN 3 ITA.NO.2505/DEL./2006 SHRI RAMESH CHAND VS. ITO CONFIRMING THE ACTION OF LD. A.O. IN MAKING OF ADDI TIONS OF RS. 108/- ON ACCOUNT OF ALLEGED PROFITS BY CONSIDE RING THE DEPOSITS IN THE BANK ACCOUNT OF M/S RATTAN LAI RAVI NDER KUMAR AS SALE PROCEEDS OF THE APPELLANT BY TREATIN G THE SAID FIRM AS BENAMI OF THE APPELLANT AND WITHOUT ANY BAS IS MATERIAL OR EVIDENCE AND BY RECORDING INCORRECT FAC TS AND FINDINGS AND THAT GIVING AN ADEQUATE OPPORTUNITY OF BEING HEARD. 7. THAT HAVING REGARD TO THE FACTS AND CIRCUMSTANCE S OF THE CASE, LD. CIT (A) HAS ERRED IN LAW AND ON FACTS IN SUSTAINING ADDITION OF RS.25,98,J50/- ON ACCOUNT OF ALLEGED PEEK INVESTMENT AS UNDISCLOSED INCOME ON THE BASIS TRANSACTIONS OF M/S. CHITTAR MAL BUDH RAM, M/S BA NSAL BROTHER, M/S. SEEMA TRADING COMPANY AND M/S BUDHMA L & SONS BY TREATING SUCH TRANSACTIONS AS CONDUCTED BY THE APPELLANT BY TREATING THE ABOVE FIRMS AS BENAMI CO NCERNS OF THE A APPELLANT AND FURTHER BY TAKING ALLEGED PROFI T WITHOUT ANY BASIS, MATERIAL OR EVIDENCE AND BY RECORDING IN CORRECT FACTS AND FINDINGS AND THAT TOO WITHOUT GIVING AN A DEQUATE OPPORTUNITY OF BEING HEARD. 8. THAT HAVING REGARD TO THE FACTS AND CIRCUMSTANCE S OF THE CASE, LD.CIT (A) HAS ERRED IN LAW AND ON FACTS IN S USTAINING THE DISALLOWANCE OF RS. 3,488/- OUT OF SHOP EXPENSE S. TELEPHONE EXPENSES AND OFFICE KITCHEN EXPENSES. 9. THAT HAVING REGARD TO THE FACTS AND CIRCUMSTANCE S OF THE CASE, LD.CIT (A) HAS ERRED IN LAW AND ON FACTS IN C ONFIRMING THE IMPUGNED ASSESSMENT ORDER AND IN MAKING ABOVE ADDITION AND DISALLOWANCES WITHOUT OBSERVING THE PR INCIPLES OF NATURAL JUSTICE AND WITHOUT GIVING ADEQUATE OPPO RTUNITY OF BEING HEARD AND WITHOUT MAKING WITNESSES AVAILABLE FOR CROSS EXAMINATION AND WITHOUT CONFRONTING THE MATER IAL COLLECTING AT THE BACK AND BY RECORDING INCORRECT FACTS AND BY CONSIDERING IRRELEVANT MATERIAL. 10. THAT IN ANY VIEW OF THE MATTER AND IN ANY CASE, ADDITIONS AND DISALLOWANCES MADE IN THE ASSESSMENT ORDER ARE BAD IN LAW AND AGAINST THE FACTS AND CIRCUMSTANCES OF THE CASE AND 4 ITA.NO.2505/DEL./2006 SHRI RAMESH CHAND VS. ITO LD. A.O. IN ANY CASE OUGHT TO HAVE ALLOWED TELESCOP ING OF THE ADDITION WHEREVER POSSIBLE. 11. THAT HAVING REGARD TO THE FACTS AND CIRCUMSTANC ES OF THE CASE, LD.CIT (A) HAS ERRED IN LAW AND ON FACTS IN C ONFIRMING THE ACTION OF LD. A.O. IN CHARGING INTEREST U/S 234 B. 12. THAT THE APPELLANT CRAVES THE LEAVE TO ADD. MOD IFY, AMEND OR DELETE ANY OF THE GROUNDS OF APPEAL AT THE TIME OF HEARING AND ALL THE ABOVE GROUNDS ARE WITHOUT PREJUDICE TO EACH OTHER. 2. BRIEFLY STATED THE FACTS NECESSARY FOR ADJUDICA TION OF THE CONTROVERSY AT HAND ARE : ASSESSEE FIRM IS INTO THE BUSINESS OF SALE AND PURCHASE OF FOODGRAINS AND CATTLE FEED ITE MS. A.O. NOTICED FROM THE BALANCE SHEET FOR ASSTT. YEAR 2002 -03 THAT ASSETS OF RS. 50,300/- ARE APPEARING IN THE NAME OF M/S. RATTAN IRON STORE. M/S. RATTAN IRON STORE WAS CALLED TO EX PLAIN WHO HAS INTIMATED VIDE REPLY DATED 14.2.2006 THAT NO D EALING TOOK PLACE WITH THE ASSESSEE FIRM DURING THE PERIOD 1.4. 2002 TO 31.3.2003 AND THERE WAS NO OPENING AND CLOSING BALA NCE DURING THE SAID PERIOD. HOWEVER THE ASSESSEE HAS AL SO FURTHER SHOWN AN AMOUNT OF RS. 50,300/- IN THE NAME OF M/S. RATTAN IRON STORE FOR ASSTT. YEAR 2003-04 IN THE BALANCE S HEET AS ON 31.3.2003. SO THE A.O. AFTER REJECTING THE BOOKS OF ACCOUNTS 5 ITA.NO.2505/DEL./2006 SHRI RAMESH CHAND VS. ITO MADE AN ADDITION OF RS. 50,300/- TO THE INCOME OF A SSESSEE FOR ASSTT. YEAR 2003-04. 3. FROM THE BANK ACCOUNT NO. 21353 IN THE NAME OF M /S. SAT NARAIN DINESH KUMAR A.O. NOTICED THAT AN AMOUNT OF RS. 34,31,234/- HAS BEEN CREDITED TO ITS ACCOUNT DURIN G THE PERIOD 1.4.2002 TO 31.3.2003 BEING RECEIPT ON SALE OF MUST ARD SEED. ASSESSEE WAS CALLED UPON TO EXPLAIN THE DEPOSITS IN THE BANK. ASSESSEE FURNISHED COPIES OF THE BANK ACCOUNT IN TH EIR EXPLANATION BUT NO EVIDENCE HAS BEEN PRODUCED, SO T HE A.O. BY TAKING PROFIT RATIO OF THIS @0.22% AS SHOWN BY THE ASSESSEE OBSERVED THAT ASSESSEE HAS EARNED PROFIT OF RS. 7, 549/- FROM THE AFORESAID AMOUNT AND MADE ADDITION THEREOF TO T HE INCOME OF THE ASSESSEE. SIMILARLY A.O. NOTICED AN AMOUNT O F RS. 49,000/- CREDITED IN BANK ACCOUNT NO. 01050060366 I N THE NAME OF M/S. RATTAN LAL RAVINDER KUMAR. FOR LACK OF EVIDENCE A.O. BY TAKING PROFIT RATIO OF THIS AMOUNT AT 0.22% AS SHOWN BY THE ASSESSEE WORKED OUT THE PROFIT OF RS. 108/- EARNED BY ASSESSEE AND MADE ADDITION THEREOF TO ITS INCOME. 6 ITA.NO.2505/DEL./2006 SHRI RAMESH CHAND VS. ITO 4. A.O. FURTHER PERUSED THE BANK ACCOUNT NO. 2764 ( NEW ACCOUNT NO. 102764) MAINTAINED WITH OBC, REWARI IN THE NAME OF M/S. BUDH RAM CHITTAR MAL REWARI . A.O. NOTICED THAT IN THE ASSESSMENT YEAR 2001-02 ONE SHRI VIKRAM SINGH WAS E XAMINED ON THE DIRECTION OF LD. CIT (A) ROHTAK REGARDING I NVESTMENT IN THE FIRM M/S. RATTAN IRON STORE AND IT WAS HELD BY THE A.O. AS BENAMI CONCERN OF SHRI RAMESH CHAND ASSESSEE AS BAN K ACCOUNT OF THE SAME WAS OPENED IN THE NAME OF HIS S ERVANT SHRI VIKRAM SINGH WHOSE STATEMENT WAS RECORDED ON 3.3.2005. SHRI VIKRAM SINGH VIDE HIS STATEMENT DATED 3.3.2005 RECORDED BY A.O. DISCLOSED THAT HE HAS OPENED BANK ACCOUNT I N THE NAME OF M/S. BUDH RAM CHITTAR MAL REWARI IN ORIENTAL BAN K OF COMMERCE REWARI AT THE INSTANCE OF SHRI RAMESH CHAN D AND THIS FACT HAS ALSO BEEN REAFFIRMED BY SHRI VIKRAM S INGH IN HIS AFFIDAVIT DATED 9.3.2005 AND 28.3.2005. THEN INFORM ATION FROM THE AFORESAID BANK WAS CALLED BUT THE BANK MANAGER VIDE LETTER DATED 25.5.2005 REPORTED THAT THEY HAVE NO SUCH ACC OUNT WITH THEIR BRANCH AND FURTHER INTIMATED THAT THE BANK WA S HAVING ACCOUNT IN THE NAME OF M/S. CHITTAR MAL BUDH RAM WH ICH HAS 7 ITA.NO.2505/DEL./2006 SHRI RAMESH CHAND VS. ITO SINCE BEEN CLOSED ON 22.4.2003. FROM INQUIRY AND D OCUMENT ON RECORD A.O. PROCEEDED TO CONCLUDE THAT THE BUSIN ESS CONDUCTED IN THE NAME OF M/S. CHITTAR MAL BUDH RAM WAS CONTROLLED AND OWNED BY SHRI RAMESH CHAND ASSESSEE AS A BENAMI CONCERN FLOATED IN THE NAME OF HIS POOR EMPL OYEE AND DURING THE YEAR UNDER ASSESSMENT AFORESAID ACCOUNT IS FOUND TO HAVE AN AMOUNT OF RS. 1,28,97,111/-. A.O. HAS SEPAR ATELY CONSIDERED CREDIT ENTRIES FOR WORKING OUT INVESTMEN T AND GROSS PROFIT EARNED. 5. A.O. FURTHER OBSERVED FROM ACCOUNT NO. 010500604 18 MAINTAINED WITH SBOP NARNAUL MAIN BRANCH IN THE NAM E OF BANSAL BROTHERS THAT THE BUSINESS CONDUCTED IN THE NAME OF M/S. BANSAL BROTHERS THROUGH THIS BANK ACCOUNT NUMB ER WAS CONTROLLED AND OWNED BY SHRI RAMESH CHAND ASSESSEE AS BENAMI CONCERNS IN THE NAME OF ITS POOR EMPLOYEE S HRI VIKRAM SINGH. DURING THE YEAR UNDER ASSESSMENT, GROSS CRED IT TO THE TUNE OF RS. 50,05,707/- WAS NOTICED AND CREDIT ENT RIES ARE BEING SEPARATELY CONSIDERED IN PARAGRAPH 5A FOR WOR KING OUT INVESTMENT AND GROSS PROFIT. 8 ITA.NO.2505/DEL./2006 SHRI RAMESH CHAND VS. ITO 6. SIMILARLY A.O. OBSERVED FROM ACCOUNT NO. 444 (NE W NUMBER 308 OF S.B. INDORE, REWARI IN THE NAME OF M/ S. SEEMA TRADING CO., THIS ACCOUNT ALSO FOUND TO BE BENAMI B Y THE A.O. BEING RUN BY SHRI RAMESH CHAND AND ACCOUNT OPENING FORM WAS SIGNED BY MUKESH BROTHER OF SHRI RAMESH CHAND S O A.O. CAME TO THE CONCLUSION THE BUSINESS CONDUCTED IN TH E NAME OF M/S. SEEMA TRADING CO. THROUGH BANK ACCOUNT 444(NEW TRADING) WAS CONTROLLED AND OWNED BY SHRI RAMESH CH AND AS A BENAMI TRANSACTION IN THE NAME OF THE POOR EMPLOYEE SHRI SATVIR AND FOUND GROSS CREDIT AMOUNT IN THE ACCOUNT AT RS. 5,21,99,513/-. 7. A.O. FURTHER PERUSED ACCOUNT NUMBER 01050060405 AND ACCOUNT NUMBER 01050060443 MAINTAINED WITH STATE BA NK OF PATIALA MAIN BRANCH NARNAUL IN THE NAME OF M/S. SEE MA TRADING CO. FROM THE BANK ACCOUNT A.O. FOUND THAT T HIS ACCOUNT HAS BEEN OPENED IN THE NAME OF SHRI GHANSHA M SON OF SHRI RAMOTAR AND FOUND TO BE BENAMI TRANSACTION OF ASSESSEE. DURING THE YEAR UNDER ASSESSMENT GROSS CR EDIT AMOUNT IN THE ACCOUNT IN BOTH THE ACCOUNT FOUND TO BE RS. 9 ITA.NO.2505/DEL./2006 SHRI RAMESH CHAND VS. ITO 14,94,41,494/- AND RS. 4,72,751/- RESPECTIVELY. A. O. MADE AN ADDITION AS PER PARAGRAPH 5A READ WITH PARA 5(I) TO 5(IV) AT RS. 5,91,03,848/- AND ASSESSED THE INCOME AT RS. 6,10,7 4,020/-. 8. ASSESSEE CARRIED THE MATTER BEFORE LD. CIT(A) BY FILING AN APPEAL WHO HAS DISMISSED THE SAME. BEING AGGRIEVED ASSESSEE HAS COME BEFORE TRIBUNAL BY WAY OF FILING OF PRESEN T APPEAL. 9. WE HAVE HEARD THE LD. AUTHORIZED REPRESENTATIVE S OF THE PARTIES TO THE APPEAL, GONE THROUGH THE DOCUMENTS R ELIED UPON AND ORDERS PASSED BY THE REVENUE AUTHORITIES BELOW IN THE LIGHT OF THE FACTS AND CIRCUMSTANCES OF THE CASE. 10. AT THE VERY OUTSET LD. AR FOR THE ASSESSEE FAIR LY CONCEDED THAT HE HAS NO CASE SO FAR AS GROUND NO. 1 TO 4,8,9 ,10,11,12, ARE CONCERNED. HENCE THESE GROUNDS ARE DETERMINED A GAINST THE ASSESSEE. 11. UNDISPUTEDLY IDENTICAL ISSUE AS TO MAKING INVES TMENT BY THE ASSESSEE IN THE BANK ACCOUNT IN THE NAME OF SIM ILAR BENAMI CONCERN NAMELY M/S. RATTAN IRON STORE, M/S. SATYA N ARAIN DINESH KUMAR , M/S. BANSAL BROTHERS AND M/S. SEEMA TRADING 10 ITA.NO.2505/DEL./2006 SHRI RAMESH CHAND VS. ITO HAS ARISEN BEFORE THE COORDINATE BENCH OF THE TRIBU NAL IN ASSESSEES OWN CASE IN ITA NO. 3617/DEL/2013 DATED 30.8.2016 FOR ASSESSMENT YEAR 2001-02. GROUND NO. 3 12. SO FAR AS ADDITION OF RS. 50,300/- IS CONCERNED A.O. IN PARA 2(B) AT PAGE 10 OF THE ASSESSMENT ORDER HAS CA TEGORICALLY MENTIONED THAT, IN THE BALANCE SHEET AS ON 31.3.20 02 OF M/S. RATTAN IRON STORE FILED BY ASSESSEE AND RETURN OF I NCOME FOR ASSTT. YEAR 2002-03 ASSET IN THE NAME OF M/S. RATTA N IRON STORE WAS SHOWN AT RS. 50,300/-. THIS FACT IS FURTHER PR OVED FROM THE IMPUGNED ORDER PASSED BY LD. CIT(A). CIT(A) AS RECO RDED IN PARA 6.2. STRANGELY ENOUGH WHEN THESE ASSETS OF RS. 50,300/- PERTAINS TO ASSESSMENT YEAR 2002-03 THEN HOW THE AD DITION THEREOF HAS BEEN MADE IN ASSESSMENT YEAR 2003-04. I F ANY SUCH ADDITION IS TO BE MADE THAT HAS TO BE MADE IN ASSESSMENT YEAR 2002-03. LD. CIT(A) HAS LOST SIGHT OF THIS FAC T WHILE CONFIRMING THE ADDITION OF RS. 50,300/-. SO WE ARE OF THE CONSIDERED VIEW THAT A.O./CIT(A) HAVE ERRED IN MAKI NG OF 11 ITA.NO.2505/DEL./2006 SHRI RAMESH CHAND VS. ITO ADDITION OF RS. 50,300/-, WHICH IS LIABLE TO BE DEL ETED. HENCE GROUND NO. 3 IS DETERMINED IN FAVOUR OF THE ASSESSE E. GROUND NO. 5,6 AND 7 13. A.O. MADE AGGREGATED ADDITION OF RS. 5,91,03,84 8/- AS UNDISCLOSED INCOME ON THE BASIS OF PEAK INVESTMENT BY TREATING TRANSACTION RECORDED BY ASSESSEE IN THE NA ME OF M/S. CHITTAR MAL BUDH RAM, M/S. BANSAL BROTHERS, M/S. S EEMA TRADING CO., M/S BUDH MAL & SONS BY TREATING THE SA ME AS BENAMI CONCERNS OF THE ASSESSEE. 14. LD. AR FOR THE ASSESSEE CHALLENGING THE IMPUGNE D ORDER CONTENDED THAT A.O. AS WELL AS LD. CIT(A) HAVE ERRE D IN COMPUTING THE ALLEGED PROFIT WITHOUT ANY BASIS, MAT ERIAL OR EVIDENCE AND BY RECORDING INCORRECT FACTS WITHOUT P ROVIDING OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. LD. AR OF THE ASSESSEE FURTHER CONTENDED THAT THE AMOUNT OF ADDIT ION INVOLVED IN GROUND NO. 5,6 & 7 IS PART OF THE ADDIT ION OF RS. 5,65,05,698/- MADE IN ASSTT. YEAR 2001-02 WHICH HAS SINCE BEEN DELETED BY THE COORDINATE BENCH OF THE TRIBUNA L FOR ASSTT. 12 ITA.NO.2505/DEL./2006 SHRI RAMESH CHAND VS. ITO YEAR 2001-02 IN ITA NO. 3617/DEL/2013 IN ASSESSEES OWN CASE AND SUCH THE BALANCE ADDITION IS ALSO LIABLE TO BE DELETED. 15. HOWEVER ON THE OTHER HAND LD. DR FOR THE REVENU E TO REPEL THE ARGUMENT ADDRESSED BY LD. AR FOR THE ASSE SSEE CONTENDED THAT THE A.O. MADE ADDITION AFTER DISCUSS ING ALL THE DETAILS AND EVIDENCES AND IT IS PROVED ON RECORD TH AT THESE CONCERNS ARE BENAMI CONCERNS OF THE ASSESSEE. 16. PERUSAL OF THE ORDER DATED 30.8.2016 PASSED BY THE COORDINATE BENCH OF THE TRIBUNAL IN ASSESSEES OWN CASE IN ASSTT. YEAR 2001-02 (SUPRA) GOES TO PROVE THAT ADDI TION OF RS. 5,65,05,698/- WAS MADE ON ACCOUNT OF PEAK INVESTMEN T AND ESTIMATED PROFIT ON THE GROUND THAT THE ASSESSEE WA S FOUND MAKING INVESTMENT IN BENAMI CONCERNS. IN PARA 10.1 OF THE IMPUGNED ORDER PASSED BY THE LD. CIT(A) IT IS CATEG ORICALLY RECORDED THAT IN ASSTT. YEAR 2001-02 THE ASSESSEE W AS HELD TO BE BENAMI IN RESPECT OF M/S. SANTOSH KUMAR VIJAY KU MAR, M/S. SEEMA TRADING COMPANY , M/S. RATAN LAL RAVINDER KUM AR,M/S. CHITTAR MAL BUDH RAM, M/S. BANSAL BROTHERS OPERATE D THROUGH 13 ITA.NO.2505/DEL./2006 SHRI RAMESH CHAND VS. ITO SHRI GHANSHYAM, VIKRAM, ROHTASH, SATVIR, M/S. SATYA NARAIN DINESH KUMAR, NARNAUL , M/S. GOBIND RAM SAT NARAIN, NARNAUL. 17. UNDISPUTEDLY ADDITION OF RS. 5,65,05,698/- MADE BY THE A.O. AFFIRMED BY LD. CIT(A) IN ASSTT. YEAR 2001-02 BEING UNDISCLOSED INCOME AS THE INVESTMENT WAS MADE IN TH E AFORESAID FIRM, HAS SINCE BEEN DELETED BY THE COORD INATE BENCH OF THE TRIBUNAL AND THE REVENUE IS NOT AGGRIEVED WI TH THE SAID ORDER. WHEN THE AMOUNT OF ADDITION MADE BY THE A.O. AND AFFIRMED BY LD. CIT(A) IN GROUND NO. 5,6,7 IS UNDIS PUTEDLY PART AND PARCEL OF ADDITION MADE IN 2001-02 MADE FOR THE REASON THAT THE ASSESSEE IS MAKING ADJUSTMENT IN THE AFORE SAID CONCERNS AS BENAMIDAR, THIS ADDITION IS ALSO NOT SU STAINABLE. 18. FOR READY PERUSAL OPERATIVE PART OF THE ORDER P ASSED BY THE COORDINATE BENCH OF THE TRIBUNAL IN ASSESSEES OWN CASE FOR ASSTT. YEAR 2001-02 (SUPRA) IS REPRODUCED AS UNDER :- 12. IN THE BACKDROP OF THE AFORESAID FACTS AND CIRCUMSTANCES OF THE CASE AND THE RECORD RELIED UPO N BY THE PARTIES TO THE APPEAL, THE FIRST QUESTION ARISE S FOR DETERMINATION IN THIS CASE IS :- 14 ITA.NO.2505/DEL./2006 SHRI RAMESH CHAND VS. ITO AS TO WHETHER ADDITION OF RS. 5,65,05,698/- AND RS . 15,60,079/- MADE ON ACCOUNT OF PEAK INVESTMENT AND ESTIMATED PROFIT MADE BY THE A.O. HAS BEEN WRONGLY DELETED BY THE CIT(A)? 13. FROM THE UNDISCLOSED FACTS, ARGUMENTS ADDRESSED BY THE AUTHORIZED REPRESENTATIVES OF THE PARTIES AND D OCUMENTS BROUGHT ON RECORD, WE FIND NO GROUND TO INTERFERE I NTO THE FINDINGS RETURNED BY THE LD. CIT(A) FOR THE FOLLOWI NG REASONS :- (I) THAT THERE WAS NO PRIMA FACIE MATERIAL BEFORE T HE A.O. NOR HE HAS COLLECTED ANY SUCH MATERIAL TO ARRIVE AT THE CONCLUSION THAT ASSESSEE IS A BENAMI OWNER OF THE AFORESAID FIRMS VIZ. (I) M/S. SANTOSH KUMAR VIJAY K UMAR; (II) M/S. RATTAN LAL RAVINDER KUMAR; (III) M/S. SAT NARAIN DINESH KUMAR; AND (IV) GOBIND RAM SAT NARAIN; (II) THAT EVEN DURING THE REMAND PROCEEDINGS, THE A .O. HAS FAILED TO LAY HAND ON ANY SUCH MATERIAL TO SUBSTANT IATE HIS FINDINGS THAT THE ASSESSEE IS A BENAMI ENTITY R UNNING BUSINESS IN THE NAMES OF AFORESAID FOUR FIRMS. SO, THERE IS NOT AN IOTA OF EVIDENCE THAT THE ASSESSEE IS BEN AMI OWNER OF AFORESAID FOUR FIRMS. (III) THAT THE A.O. HAS BLINDLY RELIED UPON THE ENQ UIRY REPORT GIVEN BY INSPECTOR THAT ROHTAS KUMAR, PROP. OF M/S. SAT NARAIN DINESH KUMAR IS AN EMPLOYEE OF ONE BISHA N BANIYA ENGAGED IN SIMILAR BUSINESS AS THAT OF ASSES SEE BUT HAS NOT PREFERRED TO RECORD THE STATEMENT OF RO HTAS KUMAR HIMSELF WHOSE BANK ACCOUNT NO. 1353 OF OBC, NARMAUL WAS OPENED AT THE INTRODUCTION OF SUSHIL KUMAR, SO IN THESE CIRCUMSTANCES, IT CANNOT BE SAID THAT M/S. SAT NARAIN DINESH KUMAR IS THE BENAMI BUSINESS OF THE ASSESSEE. (IV) THAT CIT(A) HAS RIGHTLY SCRUTINIZED THE STATEM ENTS OF GHANSHYAM AND VIKRAM SINGH RECORDED BY THE A.O. AND CAME TO THE CONCLUSION ON THE BASIS OF INHERENT CONSISTENCIES THAT THESE ARE NOT THE STATEMENT VOLUNTARILY MADE BY THEM RATHER THEY HAVE MERELY PU T THEIR SIGNATURES WITHOUT KNOWING THEIR CONTENTS; 15 ITA.NO.2505/DEL./2006 SHRI RAMESH CHAND VS. ITO (V) THAT THERE IS NOT AN IOTA OF EVIDENCE ON RECORD TO PROVE AS TO FROM WHERE THE ASSESSEE HAS MADE THE PURCHASE S OF MUSTARD SEED TO THE TUNE OF TENS OF CRORES OF RU PEES. A.O. HAS NOT PREFERRED TO RECORD STATEMENT OF ANY O F THE TRADERS FROM THE LOCAL MARKETS TO SUBSTANTIATE THE ALLEGATION MADE AGAINST THE ASSESSEE; (VI) THAT THE A.O. MADE AN ADDITION OF ALL THE CRED IT ENTRIES IN THE BANK OF THE FOUR FIRMS WITHOUT VERIFYING THE DETAILS OF TRANSACTIONS IN EACH OF THE BANK ACCOUNT ; (VII) THAT THE A.O. HAS ALSO FAILED TO EXPLAIN AS T O HOW AND ON WHAT GROUNDS, HE HAS RESORTED TO ADDITION OF PEAK INVESTMENT ON 15 DAYS CYCLE; (VIII) THAT WHEN THE VERY EXISTENCE OF AFORESAID FO UR FIRMS BEING BENAMI OWNERSHIP OF ASSESSEE HAS NOT BEEN ESTABLISHED MAKING AN ADDITION OF PEAK INVESTMENT O F 15 DAYS CYCLE IS WITHOUT ANY BASIS; (IX) THAT WHEN THE ASSESSEE HAS HIMSELF ADMITTED BA NK ACCOUNT NO. 60349 IN SBOP, NARNAUL IN THE BOOKS OF ACCOUNT SHOWING TURNOVER OF RS. 62,00,683/-, THERE IS NO QUESTION OF ADDING THE PEAK INVESTMENT OF THIS B ANK ACCOUNT OF RS. 26,80,750/- DOES NOT ARISE; (X) THAT SO FAR AS ACCOUNT NO. 1927 IN SBOP, NAR NAUL IS CONCERNED, THE SAME IS OPENED IN THE NAME OF ASSESS EE BUT THE TRANSACTION IN THE SAID ACCOUNT PERTAINS TO HIS BROTHERS, SHRI PAWAN KUMAR AND SHIR MUKESH KUMAR. BUT AT THE SAME TIME, THE ASSESSEE HAS GIVEN REVISE D CALCULATION AND BY APPLYING THE GP RATE OF 0.71%, ALREADY ACCEPTED BY THE A.O., THE AMOUNT COMES TO R S. 1,79,915/-; (XI) THAT THE A.O. HEAVILY RELIED UPON THE STATEMEN T OF KANTI PARKASH WHO HAS STATED THAT HE HAS BEEN DOING BUSINESS WITH SHRI RAMESH CHAND, THE ASSESSEE, IN T HE NAME OF THREE BOGUS CONCERNS NAMELY (I) M/S. SANTOS H KUMAR VIJAY KUMAR TO THE TUNE OF RS. 4,28,852/-; (I I) M/S. RATTAN LAL RAVINDER KUMAR TO THE TUNE OF RS. 7,11,100/-; AND (III) M/S. SAT NARAIN DINES KUMAR T O THE TUNE OF RS. 3,63,540/- ON THE BASIS OF TELEPHONIC 16 ITA.NO.2505/DEL./2006 SHRI RAMESH CHAND VS. ITO CONVERSATION FROM TIME TO TIME. BUT STRANGELY ENOUG H, THERE WAS NOTHING ON THE FILE THAT AFORESAID KANTI PARKASH WAS CONDUCTING SAID BUSINESS THROUGH OR AT THE INSTANCE OF THE ASSESSEE; (XII) THAT THE REVENUE HAS FAILED TO DEMONSTRATE TH AT THE ASSESSEE IS A BENAMI/OSTENSIBLE OWNER OF THE AFORES AID FOUR CONCERNS BY COLLECTING THE MATERIAL THAT AS TO WHEN AND IN WHOSE NAME THESE CONCERNS HAVE BEEN GOT REGISTERED AND AS TO WHAT IS THEIR STATES WITH SALE -TAX DEPARTMENT AND WITH MARKET COMMITTEE RATHER BUILT U P THE ENTIRE CASE ON THE BASIS OF SUSPICION DURING ASSESSMENT AS WELL AS DURING REMAND PROCEEDINGS; (XIII) THAT THOUGH THE A.O. HAS BASED THE ASSESSM ENT ORDER ON THE BASIS OF STATEMENT OF KANTI PARKASH BUT ASSE SSEE HAS NOT BEEN PROVIDED WITH AN OPPORTUNITY TO CROSS EXAMINE KANTI PARKASH WHICH IS VIOLATION OF RULE OF NATURAL JUSTICE AND AS SUCH THE STATEMENT OF KANTI PARKASH CANNOT BE RELIED UPON TO SUSTAIN THE ADDITI ON. (XIV) THAT THE A.O. DECLARED THE AFORESAID FOUR FIR MS AS BOGUS CONCERNS MERELY ON THE GROUND THAT THE ASSESSEE FAI LED TO PROVE THAT HE HAS NO INTEREST IN THESE DETAILS W ITH ANY DOCUMENTARY EVIDENCE, BUT STRANGELY ENOUGH THIS FACT WAS TO BE PROVED BY THE A.O. NOT THE ASSESSEE WHO IS NOT TO PROVE THE NEGATIVE; (XV) THAT WHEN THE ENQUIRIES CONDUCTED BY A.O. ITSE LF DISCLOSED THAT THE BANK ACCOUNTS OF THE AFORESAID ALLEGED FOUR BENAMIDARS OF THE ASSESSEE WERE BEING OPERATED BY SHRI PREM KUMAR, SHRI PAWAN KUMAR AND SHRI MUKESH KUMAR, ALL BROTHERS OF ASSESSEE WHO WER E INDEPENDENTLY ASSESSED TO INCOME-TAX WITH ITO, WARD NO. 1, NARNAUL, THE QUESTION OF MAKING ADDITION ON THE BASIS OF BANK ACCOUNTS OF AFORESAID BENAMIDARS IN T HE NAME OF THE ASSESSEE DOES NOT ARISE. IF AT ALL THE ADDITION WAS TO BE MADE IT HAS TO BE MADE IN THE NA ME OF THE AFORESAID PERSONS, WHO OPERATED THE SAID ACCOUNTS; 17 ITA.NO.2505/DEL./2006 SHRI RAMESH CHAND VS. ITO (XVI) THAT THE A.O. WAS AT LIBERTY TO COLLECT THE C OMPLETE DETAILS REGARDING ALLEGED TRANSACTIONS FROM THE SAL ES TAX AUTHORITIES, MARKET COMMITTEE RECORDS AND PARTIES F ROM WHOM THE MUSTARD SEEDS WERE PURCHASED BY THE ASSESSEE FOR ONWARD SALE TO DIFFERENT PERSONS BUT H E HAS NOT PREFERRED TO DO SO; (XVII) THAT ON THE BASIS OF INSUFFICIENT EVIDENCE A ND MERELY ON THE BASIS OF SUSPICION, CONJECTURES AND SURMISES ADDITION OF PEAK INVESTMENT AND ESTIMATED PROFITS F ROM THE AFORESAID ALLEGED BENAMI CONCERNS IS NOT SUSTAINABLE, HENCE RIGHTLY DELETED BY THE CIT(A). 14. IN VIEW OF WHAT HAS BEEN DISCUSSED ABOVE, QUEST ION FRAMED IS ANSWERED AGAINST THE APPELLANT/REVENUE AND FINDINGS RETURNED BY THE CIT(A) ARE HEREBY AFFIRMED . 19. SO WHEN THE REVENUE HAS FAILED TO DEMONSTRATE T HAT THE ASSESSEE IS A BENAMI OWNER OF AFORESAID CONCERNS RE FERRED IN PARA NO. 12 TO 14 BY COLLECTING THE MATERIAL THAT A S TO WHEN AND IN WHOSE NAME THESE CONCERNS HAVE BEEN GOT REGI STERED AND AS TO WHAT IS THEIR STATUS WITH SALES TAX DEPAR TMENT AND WITH MARKET COMMITTEE RATHER BUILT UP THE ENTIRE CA SE ON THE BASIS OF SUSPICION DURING ASSESSMENT PROCEEDINGS, A DDITION IS NOT SUSTAINABLE. MOREOVER IN CASE THE ASSESSEE HAS FLOATED AFORESAID FIRMS AS A BENAMIDAR, WHICH FACT IS OTH ERWISE NOT INDEPENDENTLY PROVED ON FILE, IT IS A CASE OF FRAUD AND MATTER SHOULD HAVE BEEN REFERRED TO POLICE FOR REGISTRATIO N OF THE 18 ITA.NO.2505/DEL./2006 SHRI RAMESH CHAND VS. ITO CRIMINAL CASE. SO CONSEQUENTLY ADDITION MADE AND CH ALLENGED VIDE GROUND NOS. 5,6,7 IS NOT SUSTAINABLE, HENCE DE LETED BY DETERMINING THE GROUND NO. 5,6,7 IN FAVOUR OF THE A SSESSEE. 20. IN VIEW OF WHAT HAS BEEN DISCUSSED ABOVE, PRESE NT APPEAL FILED BY THE ASSESSEE IS HEREBY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 19 TH SEPTEMBER, 2017. SD/- SD/- (B.P. JAIN) (KULDIP SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER DELHI, DATED 19.9.2017 VEENA COPY TO 1. THE APPELLANT 2. THE RESPONDENT 3. CIT(A) CONCERNED 4. CIT CONCERNED 5. D.R. ITAT G BENCH, DELHI 6. GUARD FILE.