Shri Mustufamiya H.Shaikh, Ahmedabad V. The ACIT.,Circle-11, Ahmedabad

ITA 2588/AHD/2012

• Counselvise Citation: [2013] 120 COUNSELVISE.COM (IT) 0262 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-02-2013
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Next Hearing Date: 12-12-2012
• Assessment Year: 2004-2005
• Appeal Filed On: 09-11-2012
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: RAHUL KUMAR
• Keywords: Document seized; Principle of natural justice; Opportunity of cross examination; Question of law; Documents seized; Reassessment proceedings
• Section: 143(3); 142(1); 153A; 147; 131; 148

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH AHMEDABAD (BEFORE SHRI G.G. CUPTA, VP AND SHRI A. MOHAN ALANK AMONY, AM) ITA NO.2588/AHD/2012 A. Y.: 2004-05 SHRI MUSTAFAMIYA H. SHEIKH, MUSTAFA SALES AGENCIES, 29, SHOE MARKET, BEHIND ANAND CLOTH MARKET, SARNGPUR, AHMEDABAD 380 001 P. A. NO. AEAPS 0626 J VS THE A. C. I. T., CIRCLE-11, 2 ND FLOOR, NARAYAN CHAMBERS, NEHRU BRIDGE, ASHRAM ROAD, AHMEDABAD (APPELLANT) (RESPONDENT) APPELLANT BY SHRI ANIL KSHATRIYA, AR RESPONDENT BY SHRI RAHUL KUMAR, SR. DR DATE OF HEARING: 12-12-2012 DATE OF PRONOUNCEMENT15-02-2013 O R D E R PER A. MOHAN ALANKAMONY: THIS APPEAL INITIATED, AT THE INSTANCE OF THE ASSESSEE, IS DIRECTED AGAINST THE I MPUGNED APPELLATE ORDER OF THE LEARNED CIT (A)-XVI, AHMEDABAD DATED 5 .10.2012 IN APPEAL NO.CIT (A)-XVI/ACIT/C 11/556/2011-12 FOR T HE ASSESSMENT YEAR 2004-05. 2. THE ASSESSEE HAS RAISED, IN HIS GROUNDS OF APPE AL, SIX GROUNDS IN AN ILLUSTRATIVE AND NARRATIVE MANNER. H OWEVER, THE CRUXES OF THE GRIEVANCES OF THE ASSESSEE ARE CONFINED TO T WIN ISSUES, NAMELY: (I) THE VALIDITY OF RE-OPENING THE ASSESSMENT BY ISSUANCE OF A NOTICE U/S 148 OF THE ACT; & 2 (II) ADDITION OF RS.57,50,000/- AS UNDISCLOSED INCOME ON ACCOUNT OF UNACCOUNTED RE CEIPTS. 3. BRIEFLY STATED, THE FACTS OF THE ISSUES ARE AS UNDER: THE ASSESSEE, AN INDIVIDUAL, ENG AGED IN THE BUSINESS OF SALE OF PAN MASALA AND DISTRIBUTOR OF RMD GUTKHA GR OUP PRODUCTS IN AHMEDABAD, FILED HIS RETURN OF INCOME FOR THE ASSES SMENT YEAR 2004- 05, DECLARING A TOTAL INCOME OF RS.9,65,896/- ON 15 .10.2004. THE RETURN WAS, INITIALLY, PROCESSED U/S 143(1) OF THE ACT. SUBSEQUENTLY, THE AO WAS IN RECEIPT OF INFORMATION FROM THE ADIT (INV), UNIT II(2), PUNE TO THE EFFECT THAT THE INVESTIGATION WING, BAN GALORE, HAD SEIZED INCRIMINATING DOCUMENTS RELATED TO UNACCOUNTED SALE S OF GUTKHA MADE BY SHRI SOHANRAJ MEHTA, C & F OF RMD GUTKHA GR OUP. ON THIS BASIS, THE INVESTIGATION WING, PUNE, HAD CARRIED OU T SEARCH ON 20.1.2001 IN THE CASE OF RMD GUTKHA GROUP. THE DOC UMENTS SEIZED BY THE INVESTIGATION WING, BANGALORE ALSO INCLUDED THE TRANSACTIONS OF RS.57,50,000/- WHICH HAD BEEN DEPLOYED TO SHRI MUST UFAMIYA H SHAIAKH BY RMD GUTKHA GROUP. THE AO, ON THE BASIS OF THIS INFORMATION, SOUGHT TO REOPEN THE ASSESSMENT OF THE ASSESSEE BY ISSUANCE OF A NOTICE U/S 148 OF THE ACT ALONG WITH A COPY OF THE REASONS RECORDED FOR THE SAME. IN COMPLIANCE, THE ASSESSEE REQUESTED THE AO TO TREAT THE ORIGINAL RETURN OF IN COME FILED BY HIM FOR THE ASSESSMENT YEAR UNDER CONSIDERATION AS THE RETU RN FILED AGAINST THE NOTICE U/S 148 OF THE ACT. THEREUPON, THE ASSE SSEE WAS REQUIRED TO FURNISH THE RELEVANT PARTICULARS AND TO SHOW-CAU SE THE STATEMENT OF SHRI SOHANRAJ MEHTA ON 9.12.2011. THE RELEVANT POR TION OF THE SHOW- CAUSE NOTICE READS AS UNDER: 3 2. IN THIS REGARD, PLEASE FIND ENCLOSED COPY OF ST ATEMENT OF SHRI SOHANRAJ MEHTA, SON OF LATE SHRI MANIKCHAND MEHTA FROM WHOSE RESIDENCE CERTAIN DOCUMENTARY EVIDENCES WERE FOUND, INDICATING CASH P AYMENTS MADE TO YOU. THE ASSESSMENT IN YOUR CASE HAS BEEN RE-OPENED ON THE B ASIS OF THESE DOCUMENTS FROM WHICH IT IS CLEARLY EVIDENT THAT YOU HAVE MADE THES E TRANSACTIONS. FURTHER, YOU ARE REQUIRED TO SHOW-CAUSE AS TO WHY AN AMOUNT OF R S.57,50,000/- SHOULD NOT BE ADDED TO YOUR TOTAL INCOME, AS THE SAME HAS BEEN DE PLOYED TO YOU BY SHRI SOHANRAJ MEHTA, C & F FOR KARNATAKA REGION OF RMD G UTKHA GROUP OUT OF THE UNACCOUNTED SALES CARRIED OUT BY HIM. A COPY OF PA GE NO.47 OF ANNEXURE-A-M-8 IS ENCLOSED WHICH SHOWS THE UNACCOUNTED SALES CARRI ED BY SHRI SOHANRAJ MEHTA FOR THE MONTHS OF JANUARY 2004 TO MARCH 2004. YOU ARE REQUIRED TO GO THROUGH THE SAME AND OFFER YOUR EXPLANATION/COMMENTS. IN C ASE OF NON-COMPLIANCE, THE ABOVE AMOUNT WILL BE ADDED TO YOUR TOTAL INCOME. 3.1. IN RESPONSE, THE ASSESSEE FILED WRITTEN SUBMI SSION ON 14.12.2011 STATING, INTER ALIA, THAT (I) THERE WAS NO SUCH TRANSACTION WITH SHRI SOHANRA J MEHTA AS STATED IN THE STATEMENT RECORDED DURING THE COURSE OF SEARCH; (II) THE DOCUMENTS ON WHICH BASIS THE ASSESSMENT WA S REOPENED PERTAIN TO SHRI SOHANRAJ MEHTA AND THERE W AS ONLY MENTION OF THE NAME AS SHRI MUSTAFABHAI WHICH DID NOT BEAR ANY PROPER IDENTIFICATION, INDICATING THAT THE TRANSACTIONS PERTAINED TO THE ASSESSEE; & (III) THE LANGUAGE OF PAGE NO.47 OF ANNEXURE A/M-8 WAS NOT KNOWN TO THE ASSESSEE. 3.2. THE AO HAD, HOWEVER, REJECTED THE ASSESSEES OBJECTIONS AND BASED ON THE SEIZED DOCUMENTS AT PAGE 34 OF A/M /8 BEING CONSOLIDATED STATEMENT FOR THE PERIOD APRIL 2003 AN D AUGUST 2006 AND PAGE NO.47 OF THE SEIZED DOCUMENTS MONTHLY S UMMARY FOR JANUARY 2004 TO MARCH 2004 OF THE UNACCOUNTED TRANS ACTIONS CARRIED OUT BY SHRI SOHANRAJ MEHTA, C & F FOR KARNATAKA REG ION OF RMD GUTKHA GROUP AND FOR THE REASONS RECORDED IN HIS IM PUGNED ORDER UNDER DISPUTE, THE AO CAME TO THE CONCLUSION THAT T HE ASSESSEE HAD 4 INDEED RECEIVED RS.57,50,000/- FROM SHRI SOHANRAJ M EHTA DURING THE PERIOD FEBRUARY 2004. ACCORDINGLY, THE AO CONCLUDE D THE ASSESSMENT U/S 147 OF THE ACT ON 28.12.2011 BY ADDI NG RS.57.50 LAKHS AS UNDISCLOSED INCOME OF THE ASSESSEE. 4. AGGRIEVED, THE ASSESSEE CARRIED THE MATTER IN A PPEAL BEFORE THE LEARNED CIT (A) FOR RELIEF. AFTER DUE C ONSIDERATION OF THE ASSESSEES LENGTHY CONTENTIONS, HIS CORRESPONDENCES WITH THE AO [COURTESY: PAGES 15 & 16 OF THE CIT(A)S ORDER], PE RUSAL OF THE RELEVANT ASSESSMENT ORDER AND ALSO EXTENSIVELY QUOT ING THE JUDICIAL PRONOUNCEMENTS WITH REGARD TO WRONGLY MENTIONING OF THE ASSESSMENT YEAR IN THE IMPUGNED NOTICE U/S 148 OF T HE ACT ETC., THE CIT (A) HAD REJECTED THE ASSESSEES OBJECTIONS FOR THE FOLLOWING REASONS: (ON PAGE 38) 2.11. A PERUSAL OF THE ABOVE, JUDICI AL CITATIONS CLEARLY INDICATE THAT MERE TECHNICAL / TYPOGRAPHICAL MISTAKE IN THE NOTICES ARE TO BE IGNORED SO FAR AS SUBSTANCE THEREOF IS IN ORDER. THE CONSEQUENT A SSTT ORDERS, CANNOT BE BRUSHED ASIDE ONLY ON THE BASIS OF SUCH INADVERTENT AND UNI NTENTIONAL MISTAKES. SIMILAR VIEWS HAVE ALSO BEEN TAKEN BY HONBLE PUNJAB & HARY ANA HIGH COURT IN THE CASE OF CIT VS RAJBEER SINGH AS AT 20 TAXMAN.COM 60 4 (2012) AND IN THE CASE OF SMT SWARNKANTA VS CIT AS AT 44 TAXMAN 68 (1989), HO NBLE KARNATAKA HGH COURT ACIT VS DALEEPKUMAR BALAR QUOTED AT 20 TAXMAN .COM 341 (2011), HONBLE ALLAHABAD HIGH COURT IN THE CASE OF DEORIA OXYGEN CO VS CIT QUOTED AT 160 TAXMAN 427 (2007), HONBLE ITAT DELHI IN TH E CASE OF ITO V. KELVINATOR INDIA LTD QUOTED AT 62 TAXMAN 155 (1992). THE ARGU MENTS TAKEN BY THE APPELLANT TO QUASH THE ASSESSMENT ORDER ON THE BASI S OF WRONG MENTION OF ASSESSMENT YEAR IN THE NOTICE, IN RESPECTFUL COMP LIANCE TO THE DECISION OF THE ABOVE MENTIONED CASES, THEREFORE CANNOT BE ACCEPTED AND ARE LIABLE TO BE REJECTED. 2.12. WITHOUT PREJUDICE TO THE ABOVE, IT IS PERTIN ENT TO NOTE THAT NO OBJECTIONS, IN CLEAR TERMS AS RAISED DURING CURRENT APPELLATE PROC EEDINGS REGARDING THE VALIDITY OF THE NOTICE I.E., NO NOTICE U/S 148 WAS ISSUED FO R AY 2004-05, WERE RAISED BY THE APPELLANT BEFORE THE AO DURING THE COURSE OF THE AS SESSMENT PROCEEDING. BEFORE THE AO, THE APPELLANT FILED LETTER DATED 14.12.11 S UPRA, BUT THE REASONS FOR ALLEGED OBJECTION WERE NOT SPECIFIED AND CONSEQUENTLY CANNO T BE TREATED AS ANY VALID OBJECTION. WITHOUT PREJUDICE, IT IS SEEN THAT THRO UGH LETTER DATED 14.11.2012 (SIC) 5 14.12.2011, THE APPELLANT HAD PRIMARILY OBJECTED TO THE NOTICE BEING ISSUED, AFTER OBTAINING THE NECESSARY SATISFACTION OF ADDL. CIT, RANGE 11, ABAD AND WANTED AN INSPECTION OF THE RECORD TO ASCERTAIN THE REASON S THEREOF. THUS, SEEN NO CLEAR AND CANDID OBJECTIONS AS STIPULATED U/S 292BB WERE TAKEN BY THE APPELLANT DURING THE CURRENCY OF THE ASSESSMENT PROCEEDINGS. 4.1. WITH REGARD TO THE APPLICABILITY OF THE STATU TORY PROVISIONS OF S.292 BB OF THE ACT AND ALSO COMPREHENSIVELY QUO TING THE FINDINGS OF THE EARLIER BENCH OF THIS TRIBUNAL IN THE CASE O F ITO V. VARIA PRATIK ENGINEERING REPORTED IN 120 TTJ 1 (AHD), THE CIT HA D OBSERVED THUS: 2.15. A PERUSAL OF THE ABOVE REFERRED ORDER OF THE HONOURABLE TRIBUNAL INDICATES THAT UNLESS AN ASSESSEE CHALLENGED THE VA LIDITY OF THE NOTICE DURING THE COURSE OF ASSESSMENT OR REASSESSMENT PROCEEDINGS, A NY OBJECTIONS TAKEN SUBSEQUENTLY ON THE MATTER OF VALIDITY OF NOTICE DO NOT SURVIVE. THERE IS NOTHING ON RECORD TO INDICATE THAT ANY SUCH VALID OBJECTION WAS MADE BEFORE THE ASSESSING OFFICER. IT IS ACCORDINGLY SEEN THAT THE RATIO LAI D DOWN BY HONOURABLE TRIBUNAL IN THE CASE OF ITO VS. VARIA PRATIK ENGINEERING AY 200 2-03 120 TTJ 1 IS SQUARELY APPLICABLE AND ACCORDINGLY THE ARGUMENTS TAKEN BY T HE APPELLANT CANNOT BE ACCEPTED AND DESERVE TO BE REJECTED. 4.2. IN RESPECT OF THE ADDITION OF RS.57.50 LAKHS, THE ASSESSEE HAD RAISED THE FOLLOWING OBJECTIONS BEFORE THE CIT (A): (I) THAT THE IMPUGNED REFERENCE TO MUSTUFABHAI ON PAG E 34 AND PAGE 47 OF SEIZED DOCUMENTS BEARING NO.A/M/8 DO NOT NECESSARIL Y IMPLICATES THE APPELLANT AS THERE CAN BE ANY OTHER PERSON BY THE S AME NAME; (II) THAT THE OPPORTUNITY OF CROSS EXAMINATION WAS NOT G IVEN BY THE AO TO CROSS-EXAMINE SRI SOHANRAJ MEHTA; (III) THAT THE DEPARTMENT HAS NOT ESTABLISHED AS TO WHO I S THE AUTHOR OF PAGE 34 OF A/M/8; (IV) THAT THE AO IS NOT CLEAR WHETHER ADDITION WAS TO BE TREATING THE IMPUGNED RECEIPTS AS CASH PAYMENTS MADE BY THE APPELLANT O R AS UNACCOUNTED RECEIPTS; (V) THAT ADDITION MADE BY THE AO AMOUNTS TO DOUBLE TAXA TION OF INCOME, NOT PERMISSIBLE IN LAW SINCE THE AMOUNT IN QUESTION STA NDS ADDED BY AOS BEING DCIT, CENTRAL CIRCLE 2(2), BANGALORE & ACI, C ENTRAL CIRCLE 1(1), PUNE IN RESPECT OF SHRI SOHANRAJ MEHTA AND M/S. DHARIWAL INDUSTRIES LIMITED RESPECTIVELY. [REFER: PARA 2.8 CIT(A )S ORDER] 6 4.3. AFTER TAKING INTO ACCOUNT THE ASSESSEES ARGU MENTS AND ALSO FOR THE REASONS RECORDED IN HIS FINDINGS UNDER DISPUTE, THE CIT (A) HAD REJECTED THE ASSESSEES CONTENTIONS THAT (I) THE ASSESSEE WAS NOT MUSTUFABHAI AS MENTIONED O N THE PAPER AND THAT HE HAS BEEN WRONGLY IMPLICATED [PARA 2.19]; (II) THE ARGUMENT THAT THE DEPARTMENT HAD NOT ESTAB LISHED AS TO WHO WAS THE AUTHOR OF PAGE 34 ANNEXURE A/M/8 WHICH HAS BEEN FOUND [PARA 2.21]; (III) THE ARGUMENT OF THE ASSESSEE THAT THE AO WAS REQUIRED TO FIRST PASS A SPEAKING ORDER IN RESPECT OF OBJECTION S WITH REGARD TO ISSUANCE OF NOTICE U/S 148 OF THE ACT; & (IV) NO OPPORTUNITY OF CROSS EXAMINATION WAS OFFERE D. IN CONCLUSION, THE CIT (A) HAD OBSERVED AS UNDER: 2.26. CONTESTING THE ADDITION MADE TO ITS RETURNE D INCOME, THE APPELLANT HAS ARGUED THAT THE SAME TANTAMOUNT TO DOUBLE TAXATION SINCE THE SEIZED PAPERS ON THE BASIS OF WHICH ADDITION HAS ALSO BEEN MADE HAS BEEN CONSIDERED BY AOS AT BANGALORE AND PUNE AND THAT THE IMPUGNED RECEIPTS S TAND TAXED IN THEIR ORDERS. THE APPELLANT THUS DREW ATTENTION TO ORDER U/S 143( 3) DATED 30.12.2011 OF DCIT, CENTRAL CIRCLE 2(2), BANGALORE FOR AY 2010-11 PASSE D IN THE CASE OF SHRI SOHANRAJ MEHTA AND ORDER U/S 153A READ WITH SEC 143 (3) DATED 29.12.2011 OF ACIT, CENTRAL CIRCLE 1(1), PUNE PASSED IN THE CASE OF M/S. DHARIWAL INDUSTRIES LTD FOR AY 2004-05. IT HAS BEEN SUBMITTED THAT THE ADDITION IN RESPECT OF IMPUGNED AMOUNT OF MONIES IN THE CASE OF SHRI SOHAN RAJ MEHTA IS MADE ON PROTECTIVE BASIS AND IN THE CASE OF DHARIWAL INDUST RIES ON SUBSTANTIVE BASIS NO ADDITION WAS REQUIRED TO BE MADE IN APPELLANTS CAS E. IT HAS BEEN ARGUED THAT IT IS A TRITE LAW THAT NO INCOME CAN BE BROUGHT TO TAX TW ICE AND THAT ACCORDINGLY THE ADDITION MADE IN THE CASE OF THE APPELLANT THUS BEC OMES UNWARRANTED. 2.27. THE REFERRED ASSESSMENT ORDERS HAVE BEEN EXAM INED. AT THE OUTSET, IT IS NOTED THAT THE ISSUE OF PROTECTIVE AND SUBSTANTI VE ADDITION COULD NOT BE UNDERSTOOD PRIMARILY SINCE THE IMPUGNED ASSESSMENT ORDERS APPARENTLY DO NOT CONTAIN ANY SUCH REFERENCE. WITHOUT PREJUDICE TO T HE SAME, THE ARGUMENTS OF THE APPELLANT HAVE BEEN ANALYZED. THE APPELLANT IS RIG HT TO THE EXTENT THAT NO INCOME CAN BE TAXED TWICE. IT IS, HOWEVER, SEEN THAT IN EV ERY FINANCIAL/ACCOUNTING TRANSACTION, THERE ARE ALWAYS TWO PARTIES WHO CAN B E CLASSIFIED AS GIVER & TAKER, SELLER & PURCHASER. DEBTOR & CREDITOR ETC. AS FAR AS DIRECT TAX STATUE IS 7 CONCERNED, THE LAW STIPULATES TAXATION OF INCOME OF BOTH THE PARTIES, IN RESPECT OF PROFITS EARNED BY EACH WHILE EXECUTING THE TRANSACT IONS. THUS, THE LAW DOES NOT POSTULATE THAT IF THE GIVER IS TAXED, THE TAKER WIL L NOT BE TAXED. BOTH THE GIVER & THE PAYER ARE REQUIRED TO PAY TAX IN RESPECT OF PRO FIT EARNED BY THEM FROM A TRANSACTION MADE WITH EITHER OF THE PARTIES. SALE OF ONE PERSON IS PURCHASE OF ANOTHER AND THE CIRCLE CONTINUES. THE MAXIM OF LAW S OF HOWEVER POSTULATES THAT IF ON A PARTICULAR INCOME GIVER HAS PAID TAX, THE T AKER WOULD NOT BE TAXED. THE ASSESSMENT ORDERS OF THE AOS AT PUNE & BANGALORE HA VE BEEN EXAMINED. IT IS SEEN THAT THE IMPUGNED AMOUNTS INDICATED ON PAGE 34 OF ANNEXURE A/M/8 HAD BEEN INCLUDED BY THE TWO AOS. THE FACT, HOWEVER, I S NOTED THAT THE AOS THEREIN HAVE NOT ADDED GROSS RECEIPTS BUT ONLY ESTIMATED PR OFITS ARISING THERE-FROM. SO FAR AS THE CASE OF THE APPELLANT IS CONCERNED, THE AMOUNT ADDED REPRESENTS AMOUNTS OF MONIES GIVEN BY SHRI SOHANRAJ MEHTA TO T HE APPELLANT. THE APPELLANT, THEREFORE, BECOMES TAXABLE IN HIS CAPACI TY AS A RECEIVER/TAKER TO PAY TAXES ON THE AMOUNTS OF MONIES RECEIVED FROM SHRI S OHANRAJ MEHTA WHICH WAS NOT HITHERTO OFFERED FOR TAXATION. THE CONTROVERSY OF ANY DOUBLE TAXATION THUS DOES NOT LIE IN THIS CASE. ON THE GIVEN FACTS, AR GUMENTS OF DOUBLE TAXATION, HYPOTHETICALLY ASSUMING, MAY EITHER BE TAKEN BY SHR I SOHANRAJ MEHTA OR DHARIWAL GROUP OF INDUSTRIES, BUT, NOT BY THE APPEL LANT. IT IS ACCORDINGLY HELD THAT THE ARGUMENTS PUT-FORTH BY THE APPELLANT ARE D EVOID OF ANY MERITORIOUS CONSIDERATION AND, HENCE, THE SAME DESERVE TO BE RE JECTED. 2.28. ANOTHER ARGUMENT TAKEN BY THE APPELLANT IS TH AT NO ADDITION ON SIMILAR GROUNDS WAS OF ONE SHRI TAUFIKHUSEN SHAIKH. THE MA TTER HAS BEEN EXAMINED AND IT HAS BEEN NOTED THAT IN HIS SWORN STATEMENT B EFORE THE AO, SHRI SHAIKH HAD CONVEYED THAT HE WAS NOT DOING ANY BUSINESS FOR DHA SRIWAL GROUP AND WAS MERELY AN EMPLOYEE/ACCOUNTANT. THE ADDITION WAS TH EREFORE NOT MADE AS NO APPARENT BUSINESS CONNECTIONS BETWEEN SHRI SHAIKH A ND M/S. DHARIWAL GROUP COULD BE ESTABLISHED. IT IS ACCORDINGLY HELD THAT THE ARGUMENTS RAISED BY THE APPELLANT HAVE BEEN PRIMARILY MADE WITH AN ATTEMPT TO TAKE BENEFIT FROM THE DECISION OF HONBLE JURISDICTIONAL HIGH COURT WHERE AS THE FACTS OF ITS CASE DO NOT AFFORD AVAILABILITY THEREOF. THE ARGUMENTS TAKEN B Y THE APPELLANT THEREFORE DESERVE TO BE DISMISSED. 2.29. IN VIEW OF THE DISCUSSIONS MADE IN THE PROCEE DING (SIC) PRECEDING PARAS IT BECOMES ABUNDANTLY CLEAR THAT THE OBJECTION RAISED BY THE APPELLANT BOTH ON THE LEGALITY OF THE ASSESSMENT MADE AS WELL AS ON THE M ERITS OF THE ADDITION ARE BEREFT OF ANY MERITS AND, HENCE, DESERVES TO BE REJECTED. CONSEQUENTLY, THE ADDITION MADE BY THE AO TO THE TOTAL INCOME OF THE APPELLANT AMOUNTING TO RS.57,50,000/- VIDE ORDER U/S 143(3) RWS 147 DATED 28.12.2011 IS C ONFIRMED 5. AGITATED, THE ASSESSEE HAS COME UP WITH THE PRE SENT APPEAL. THE LEARNED AR HAD REITERATED MORE OR LESS WHAT WAS 8 PRESENTED BEFORE THE FIRST APPELLATE AUTHORITY. IN FURTHERANCE, THE SUBMISSIONS MADE BY THE LEARNED AR ARE SUMMARIZED A S UNDER: - THAT NO REASONS AS ENVISAGED U/S 148 OF THE ACT W ERE RECORDED AND COMMUNICATED TO THE ASSESSEE; THAT A N OTICE U/S 148 DATED 29.3.2011 WAS RECEIVED BY THE ASSESSEE FO R THE AY 2005-06 AND IN COMPLIANCE THE AO WAS REQUESTED TO T REAT THE ORIGINAL RETURN FILED ON 28.10.2005 BE TREATED AS R ETURN FURNISHED IN RESPONSE TO NOTICE U/S 148 OF THE ACT. AS THE REASONS SUPPLIED TO THE ASSESSEE PERTAINED TO THE A Y 2004-05, BUT, REASONS FOR AY 2005-06 FOR WHICH SUBJECT NOTIC E U/S 148 ISSUED ON 29.3.2011 WERE NOT RECORDED. THUS, THE P ROCEEDINGS WERE VOID AB-INITIO; - THAT DURING THE ASSESSMENT PROCEEDINGS, A LETTER DATED 14.12.2011 WAS FILED STRONGLY OBJECTING TO THE ISSU ANCE OF NOTICE U/S 148 OF THE ACT AND SOUGHT PERMISSION F OR URGENT INSPECTION OF THE ENTIRE CASE RECORDS AND ALSO SUP PLY OF COPIES OF DOCUMENTS IDENTIFIED ETC., HOWEVER, THE AO HAD NOT PASSED ANY SPEAKING ORDER WITH REGARD TO THE ASSESSEES OB JECTION (SUPRA); - THAT THE PROCEEDINGS WERE INITIATED U/S 147 OF TH E ACT ON THE BASIS OF ALLEGED SEIZED MATERIALS FROM THE PREMISES OF A THIRD PARTY; THAT THE POSITION OF LAW IS CLEAR THAT ONCE THE MATTER HAD BEEN REFERABLE TO THE SEIZED DOCUMENT (SEIZED FROM THE THIRD PARTY), THEN THE ONLY RECOURSE LEFT WITH THE REVENU E IS TO INITIATE ACTION U/S 153C OF THE ACT ON THE STRENGTH OF SATI SFACTION RECORDED BY THE AO OF THE SEARCHED PERSON; AND THER E BEING FACTUAL ERROR, THE CIT (A) HAD ERRED IN REJECTING T HE GROUND OF THE ASSESSEE IN A ROUTINE MANNER; - THAT THE CIT (A) WAS NOT JUSTIFIED IN HOLDING THA T THE IMPUGNED ASSESSMENT ORDER DOES NOT SUFFER FROM LEGAL INFIRMI TY FOR THE REASONS THAT THERE EXIST ILLEGALITY, IRREGULARITY A ND INFIRMITY; - THAT THE FOUNDATION OF THE CASE WAS A STATEMENT B Y A THIRD PARTY AS GIVEN DURING THE SEARCH PROCEEDINGS AT THE PREMISES OF A THIRD PARTY; THAT THE STATEMENT DOES NOT SPECIFY THE NAME AND 9 ADDRESS OF THE ASSESSEE AND ALSO HOW THE ASSESSEE W AS CONNECTED WITH THE TRANSACTION; THAT NO OPPORTUNITY WAS GIVEN TO THE ASSESSEE TO CROSS-EXAMINE THE MAKER OF SUCH A S TATEMENT; THAT SHRI SOHANRAJ MEHTA HAD NOT NAMED THAT THE ASS ESSEE WAS THE REAL PERSON AGAINST THE NAME MENTIONED AS MUST UFABHAI (PRD) APPEARING AT PAGE 34 & 47 OF ANNEXURE AND, TH US, THIS VINDICATED THAT THE ASSESSEE CANNOT BE THIS PERSO N; AND THAT WHEN THE ASSESSEE HAD NOT CARRIED OUT ANY ALLEGED T RANSACTION WITH THE THIRD PARTY, THERE WAS NO JUSTIFICATION TO TREAT THE ASSESSEE AS THE PERSON HAVING A SIMILAR NAME AS MUSTUFABHAI; - THAT THE AO HAD, IN THE ASSESSMENT ORDER, CONCLUD ED THAT CASH AS MENTIONED ON PAGE NO.34 WAS PAID BY MR. SOH ANRAJ MEHTA TO THE ASSESSEE AT THE DIRECTION OF SHRI P R DHARIWAL, THE KEY PERSON OF THE GROUP. IT WAS SUBMITTED THAT THE SUBSEQUENT FINDING OF REJECTING THE ASSESSEES CONTENTION FOR DENIAL AND ADDING BACK THE ALLEGED UNACCOUNTED RECEIPT AS INCO ME WAS SOLELY AND ENTIRELY BASED ON THE STATEMENT OF SOHAN RAJ MEHTA ONLY WHOSE CROSS EXAMINATION WAS NOT ALLOWED BY THE AO IN SPITE OF SPECIFIC DEMAND BY THE ASSESSEE; - TO ILLUSTRATE FURTHER, PAGE 34 RECORDS RECEIPT OF GUTHKA CONSIGNMENT FROM DHARIWAL INDUSTRIES LTD DURING APR IL 2003 TO JAN 2006 TOTALING TO RS.2218,00,91,198/- (WHICH IS RECORDED ON THE LEFT SIDE OF THE PAGE). ON THE RIGHT SIDE OF T HE PAGE, PARTIES TO WHOM CASH PAYMENTS WERE MADE HAVE BEEN RECORDED, ON INSTRUCTIONS FROM DHARIWAL INDUSTRIES LTD. THE INS TRUCTIONS WERE IN THE FORM OF SLIPS OF PAPER AND THEY CONTAIN HE S IGNATURES OF MR. RASIKLAL MANIKCHAND DHARIWAL AND HIS SON MR. PR ASKASH DHARIWAL. SUCH PAYMENTS TOTALING TO RS.206,76,54,4 63/- WERE MADE IN 2003 06. THE BALANCE OF RS.11,24,36,739/ - WAS SETTLED BY ME SUBSEQUENTLY OVER A PERIOD OF TIME. THE COMMISSION RECEIVED FOR MAKING SUCH UNACCOUNTED SAL ES FOR THE ABOVE PERIOD AMOUNTS TO RS.1,52,83,320/- WHICH IS MENTIONED ON THE RIGHT HAND SIDE OF PAGE 34. PAGES 40 TO 54 IS IN MY HANDWRITING. I HAVE RECORDED THE RECEIPT OF GUTHKA FROM DHARIWAL INDUSTRIES LTD DURING THE PERIOD 2003 TO 2 006 AND THE CASH GIVEN TO VARIOUS PARTIES AS PER THE INSTRUCTIO NS OF MR. RASIKLAL MANIKCHAND DHARIWAL AND HIS SON MR. PRAKAS H 10 DHARIWAL. THESE ACCOUNTS ARE REFLECTED IN ABSTRACT RECORDED ON PAGE 34 WHICH IS DESCRIBED BY ME ABOVE. THUS, IT WAS CLAIMED THAT THIS ITSELF DEMOLISHES THE THEORY OF T HE AO TO TAX THE SAME AS RECEIPT IN THE HANDS OF THE ASSESSEE, A S A PLAIN READING OF THIS DOCUMENT COUPLED WITH THE STATEMENT OF SHRI SOHANRAJ MEHTA (SUPRA) PROVES THAT THE ALLEGED PAYM ENTS NOTED ON THE RIGHT HAND SIDE OF PAGE 34 IS THE PAYM ENT MADE TO THE COMPANY AND NOT TO THE ASSESSEE AS AN INDIVIDUAL AND THAT TOO WITHOUT ESTABLISHING HIM AS AN INDIVIDUAL BENEF ICIARY OR PROVING ENJOYMENT OF THE SAME AS HIS PERSONAL INCOM E; - THAT THE ADDITION MADE IN THE CASE OF THE ASSESSE E WAS ON ACCOUNT OF THE NOTING ON THE RIGHT SIDE OF PAGE 34, BUT, THE FACT REMAINED SAME AND TIME AND AGAIN THE SAME STAND WAS CONFIRMED BY VARIOUS ANSWERS OF SHRI SOHANRAJ MEHTA THAT THE RIGHT SIDE REPRESENTS THE PAYMENTS MADE TO THE COMP ANY FOR THE PURCHASE OF STOCK FROM THAT COMPANY AND NOTED O N THE LEFT SIDE REFLECTING QUANTITY IN BOXES AND ITS VALUE WHI CH, ACCORDING TO IT, WORKED OUT AT RS.218,00,91,198/- AND THE PAY MENT NOTED ON THE RIGHT SIDE WAS RS.206,76,54,463/- PAID BETWE EN 2003-06 AND THE BALANCE OF RS.11,24,30,739/- WAS SETTLED BY MR. SOHANRAJ MEHTA SUBSEQUENTLY. THEREFORE, IT WAS A C ASE OF SOME ALLEGED TRANSACTION MADE BY TWO INDEPENDENT PE RSONS, BUT, NOT THE ASSESSEE; - THAT THE ADDITION WAS MADE ON THE BASIS OF THE ST ATEMENT OF SHRI SOHANRAJ MEHTA AND OTHER TWO DOCUMENTS, HOWEV ER, ON A DETAILED SCRUTINY REVEALED THAT IN NONE OF THE STAT EMENTS THE ASSESSEES NAME WAS APPEARING AND, THUS, THERE WAS NO MATERIAL AGAINST THE ASSESSEE IN THOSE STATEMENTS; - WITH REGARD TO PAGE NOS. 34 & 47 OF ANNEXURE A/M/ 8 SEIZED FROM SHRI SOHANRAJ MEHTA IT WAS ASSERTED THAT THE A SSESSEE WAS NOT THE PERSON ALLEGED TO HAVE MENTIONED IN THE DOCUMENT AND ALSO DENIED OF HAVING MADE ANY SUCH UNACCOUNTED TRANSACTION WITH THE SAID PERSON, THAT THE ASSESSEE HAD NEVER PURCHASED ANY GOODS FROM THE SAME PERSON BETWEEN TH E SAID PERIOD AND HAVE ALSO NOT PAID OR RECEIVED ANY CASH FROM HIM FOR THE ALLEGED TRANSACTION; 11 - WITH REGARD TO THE AOS CONCLUSION AT PARA 3.2 OF THE ASSESSMENT ORDER, IT WAS ASSERTED THAT THERE WAS NO ANY DOCUMENTARY EVIDENCE TO SAY THAT THE PAYMENT WAS MA DE BY SHRI SOHANRAJ MEHTA TO THE ASSESSEE, BUT, WAS TO T HE COMPANY AS PER THE INSTRUCTIONS OF (PRD) AS NOTED DOWN ON T HESE TWO PAGES AND EXPLAINED IN THE ABOVE STATEMENT; AND, T HUS, THE NARRATION [PRD] FOLLOWING RS.57,50,000/- IN BOTH PA GES CLEARLY PROVES THAT IT WAS A PAYMENT MADE FOR RECEIPT OF GU THKA (BY SOHANRAJ MEHTA) TO THE SUPPLIER COMPANY; AND THAT T HE ALLEGED UNACCOUNTED RECEIPT IN THE HANDS OF THE RECIPIENTS WHETHER TAUFEEQBHAI OR MUSTAFABHAI FOLLOWED BY THE NARRATIO N (PRD) CANNOT BE ADDED BACK AS UNDISCLOSED INCOME IN THE H ANDS OF SUCH PERSONS WHOSE NAMES WERE APPEARING ON THE RIGH T SIDE OF THE PAGES 34 & 47 (SUPRA) AND IN SPECIFIC THE AMOUN T OF RS.57.5 LAKHS FOLLOWED BY THE NARRATIONS (PRD) WHIC H WAS IN THE CASE OF THE ASSESSEE. IT IS WELL SETTLED LAW T HAT EVERY RECEIPT IS NOT INCOME AND THAT THE SAME IT SHOULD P ARTAKE THE CHARACTER OF INCOME [CIT V. ASHALAND CORPORATION 133 ITR 55 (GUJ)]; - THAT THE ALLEGED DOCUMENT (PAGE 34) REVEALS THAT IT WAS ON THE LETTER-HEAD OF ALL INDIA SWETAMBER STHANAKWASI JAIN CONFERENCE MAHILA SAKHA, KARNATAKA AND NOWHERE, THE NAME OR MANY IDENTIFICATION OF AFORESAID SHOHANRAJ MEHTA APPEARS AND ALSO THE REVENUE HAD NOT ESTABLISHED AS WHO WAS THE AUTHOR OF THIS PAPER; AND THAT IT WAS MADE IT CLEAR BY THE ASSESSEES LETTER DT.9.6.2011, HE DENIED HAVING ENT ERED INTO ANY TRANSACTION WITH SOHANRAJ MEHTA OF RMD GUTKHA A ND THAT THE SAID PAPER IN NO WAY PERTAINED TO THE ASSESSEE OR HIS BUSINESS IN ANY MANNER. - THAT WHEN THE STATEMENT OF SHRI SOHANRAJ MEHTA AN D OTHER DOCUMENTS ON WHICH HIS STATEMENT WAS RECORDED WAS M ADE AVAILABLE TO THE ASSESSEE ON ONLY ON 9.12.2011 AND THE ASSESSEE VIDE HIS LETTER 14.12.2011 REQUESTED THE A O TO PROVIDE CROSS EXAMINATION OF SHRI SOHANRAJ MEHTA, T HE SAME WAS DENIED CITING PAUCITY OF TIME, EVEN THOUGH THE CASE WAS GETTING BARRED BY LIMITATION ONLY ON 31.3.2012 AND NOT ON 28.12.2011(SIC) 31.12.2011 WRONGLY HELD BY THE CIT (A). IN RESPECT OF CROSS EXAMINATION OF THE PERSON WHO MADE 12 STATEMENT, THE ASSESSEE RELIES ON THE RULING OF THE JURISDICTIONAL HIGH COURT IN THE CASE OF DCIT V. MAHENDRA AMBALAL PATEL (2010) 40 DTR (GUJ) 243; - THAT ON A PERUSAL OF THE ASSESSMENT ORDER IN THE CASE OF SHRI SOHANRAJ MEHTA CLEARLY REVEALS THAT HE HAD RETRACTE D ALL THE STATEMENTS RECORDED DURING THE SEARCH PROCEEDINGS A ND, THUS, SUCH INCONSISTENCY OF DEPOSITION OF A PERSON UPON W HOSE STATEMENT THE REVENUE HAD RELIED AND ON THE BASIS O F WHICH THE ASSESSMENT ORDER UNDER DISPUTE HAS BEEN FRAMED; - THAT ON THE BASIS OF SAME RECEIVED MATERIAL, PROC EEDINGS WERE INITIATED IN THE CASE OF TAUFEEQHUSSAIN N SHAIKH WH OSE NAME TOO APPEARED IN THE SAID SEIZED PAPER NO.34 AND ON SIMILAR FACTS, THE AO FINALIZED THE ASSESSMENT U/S 143 (3) RWS 147 OF THE ACT ON 30.11.2011 WITHOUT MAKING ANY ADDITION I N HIS HANDS. TAUFEEQHUSSAIN N SHAIKH IS A FULL TIME ACCO UNTANT OF THE ASSESSEE AND HIS STATEMENT U/S 131 OF THE ACT W AS RECORDED BY THE AO ON 25.11.2011 WHEREIN HE HAS CAT EGORICALLY STATED HAVING NOT ENTERED INTO ANY SUCH TRANSACTION WITH SHRI SOHANRAJ MEHTA; AND THAT CONSISTENCY WAS A HALL MAR K OF LAW AND JUSTICE AND IN THE ABSENCE OF ANY NEW FACTS AND CIRCUMSTANCES, ASSESSMENT/DIFFERENT TREATMENT COULD NOT BE MADE BY THE REVENUE - RELIES ON THE FINDINGS OF THE EARLIER BENCH OF TH IS TRIBUNAL IN THE CASE OF ACIT V. M/S. SHANTILAL NAGARDAS & CO. ITA NO.3362/AHD/2009 DATED 11.11.2011. 5.1. IN CONCLUSION, IT WAS SUBMITTED THAT (I) THE ORDER OF THE CIT (A) WAS BAD IN LAW AS NO O PPORTUNITY WAS AFFORDED TO THE ASSESSEE TO CROSS EXAMINE SHRI SOHANRAJ MEHTRA ON THE BASIS OF HIS STATEMENT, THE IMPUGNED ADDITION HAS BEEN RESORTED TO; & (II) THE CIT (A) HAD GROSSLY ERRED IN SUSTAINING TH E IMPUGNED ADDITION WITHOUT ADEQUATELY CONSIDERING THE SUBMISS IONS OF THE ASSESSEE. 13 5.2. ON THE OTHER HAND, THE LEARNED D R SUPPORTED THE STAND OF THE AO AND ALSO THE DETAILED ANALYSIS MADE BY TH E LEARNED CIT (A) BEFORE SUSTAINING THE ADDITION MADE BY THE AO. IT WAS, THEREFORE, PLEADED THAT SINCE THERE WAS NO ANY INFIRMITY IN TH E FINDINGS OF THE AUTHORITIES BELOW, NO INTERFERENCE OF THIS BENCH IS WARRANTED AT THIS POINT OF TIME. 6. WE HAVE CAREFULLY CONSIDERED THE RIVAL SUBMISSI ONS, PERUSED THE RELEVANT MATERIALS ON RECORD AND ALSO D OCUMENTARY EVIDENCES PRODUCED BY THE LEARNED AR DURING THE COU RSE OF HEARING IN THE SHAPE OF PAPER BOOKS. 6.1. PRIMA-FACIE, THERE ARE TWIN ISSUES WHICH REQU IRED TO BE ADJUDICATED, NAMELY: (I) THE ASSESSMENT ORDER PASSE D BY THE AO WAS WITHOUT JURISDICTION; AND THAT (II) THERE WAS A GRO SS VIOLATION OF NATURAL JUSTICE INASMUCH AS NEITHER THE AO NOR THE CIT (A) AFFORDED AN OPPORTUNITY TO THE ASSESSEE TO CROSS EXAMINE SHRI S OHANRAJ MEHTA, ON THE BASIS OF HIS STATEMENT, THE IMPUGNED ADDITIO N OF RS.57.50 LAKHS HAS BEEN MADE IN THE HANDS OF THE ASSESSEE. (I) ASSESSMENT ORDER WAS CONCLUDED WITHOUT JURISDICTION : 6.2. ON RECEIPT OF INFORMATION FROM THE INVESTIGAT ION WING OF THE DEPARTMENT, PUNE TO THE EFFECT THAT THE INVESTI GATION WING AT BANGALORE HAD UNEARTHED VOLUME OF INCRIMINATING DOC UMENTS RELATED TO THE UNACCOUNTED SALE OF GUTKHA MADE BY ONE SHRI SOHANRAJ MEHTA, C & F OF RMD GUTKHA GROUP. ON THE BASIS OF THESE EVIDENCES, THE INVESTIGATION WING OF PUNE HAD CARRI ED OUT SEARCHES 14 IN THE CASE OF RMD GUTKHA GROUP ON 20.1.2011 AND TH E DOCUMENTS UNEARTHED SPOKE, AMONG OTHERS, TRANSACTION OF RS.57 .5 LAKHS WHICH WAS DEPLOYED TO THE ASSESSEE SHRI MUSTUFAMIYA H S HAIKH AS IT WAS SEEN THAT THE ASSESSEE WAS A DISTRIBUTOR OF RMD GUTKHA GROUP FOR AHMEDABAD REGION. ACCORDINGLY, ON THE BASIS OF THE SAID INFORMATION, THE ASSESSEES ASSESSMENT FOR THE AY 2 004-05 WAS SOUGHT TO BE RE-OPENED BY THE AO BY ISSUANCE OF A N OTICE U/S 148 OF THE ACT, AFTER RECORDING THE REASONS FOR THE SAME. WHILE DOING SO, THE ASSESSMENT YEAR HAS BEEN MENTIONED AS 2005-06 IN STEAD OF 2004- 05. HOWEVER, WHILE RECORDING THE REASONS, THE ASSE SSMENT YEAR HAS BEEN CORRECTLY MENTIONED AS 2004-05 [COURTESY: P 17 & 18 OF PB AR]. THIS HAS BEEN STRONGLY OBJECTED TO BY THE ASSESSEE BEFORE THE LEARNED CIT (A). HOWEVER, IN HIS LETTER DATED 14.1 2.2011, THE ASSESSEE HAD OBJECTED TO ONLY THE ISSUANCE OF NOTIC E U/S 148 OF THE ACT DATED 29.3.2011, BUT , NOT THE WRONG MENTIONING OF THE ASSESSMENT YEAR AS 2005-06 [REFER: P 127 OF PB AR] 6.3. AFTER TAKING INTO ACCOUNT THE ASSESSEES LENG THY ARGUMENTS, THE COMMENTS OF THE AO, ASSESSEES REJOI NDER AS RECORDED IN HIS IMPUGNED ORDER [SOURCE P 6-12 OF CI T (A)S ORDER], ELABORATELY ANALYZING THE ISSUE COUPLED WITH NUMERO US CASE LAWS ALSO THE PROVISIONS OF S. 292BB OF THE ACT, AND PAR TICULARLY QUOTING THE FINDINGS OF THE EARLIER BENCH OF THIS TRIBUNAL IN T HE CASE OF ITP V. VARIA PRATIK ENGINEERING REPORTED IN 120 TTJ 1 (AHM D) ON A SIMILAR ISSUE, THE CIT (A) TOOK A STAND THAT UNLESS AN ASSE SSEE CHALLENGES THE VALIDITY OF THE NOTICE DURING THE COURSE OF ASS ESSMENT OR 15 REASSESSMENT PROCEEDINGS, ANY OBJECTION TAKEN SUBSE QUENTLY IN THE MATTER OF VALIDITY OF NOTICE DO NOT SURVIVE. 6.4. IT WAS A FACT THAT WHILE ISSUING THE NOTICE U /S 148 OF THE ACT DATED 29.3.2011 [REFER P 18 OF PB AR], THE ASSE SSMENT YEAR HAS BEEN WRONGLY MENTIONED AS 2005-06 IN STEAD OF 2004-05. HOWEVER, IN THE RECORDING OF REASONS FOR RE-OPENING OF THE ASSE SSMENT U/S 147 OF THE ACT, THE AY HAS BEEN PRECISELY MENTIONED AS 2004-05 [SOURCE: P 17 OF PB AR]. 6.5. AS RIGHTLY HIGHLIGHTED BY THE CIT (A) IN HIS IMPUGNED ORDER, THE ASSESSEE HAD NOT MADE ANY OBJECTION WHAT SOEVER BEFORE THE AO DURING THE COURSE OF ASSESSMENT PROCEEDINGS WITH REGARD TO THE VALIDITY OF THE NOTICE I.E., NO NOTICE U/S 148 OF THE ACT WAS ISSUED FOR THE AY 2004-05 ETC., NO DOUBT, THE ASSESSEE HAD RAISED, IN HIS LETTER DATED 14.12.2011 (P 127 OF PB AR], A PRIMARY OBJECTION OF ISSUANCE OF NOTICE AND REQUESTED FOR INSPECTION OF THE RECORD TO ASCERTAIN THE REASONS THEREOF, BUT, NOT THE WRONGLY MENTIONING OF THE AY IN THE NOTICE. INTERESTINGLY, IN THE SAID LETTE R THE SUBJECT WAS MENTIONED AS SUB: REOPENED ASSESSMENT PROCEEDINGS U/S 147 INCOME-TAX ACT, 1961 SHOW CAUSE/ CALLING FOR INFORM ATION U/S 142(1) OF THE ACT FOR A.Y 2004-05 . IT IS, THUS, CLEAR THAT NO OBJECTION AS PRESCRIBED U/S 292BB OF THE ACT WAS TA KEN UP BY THE ASSESSEE DURING THE COURSE OF ASSESSMENT PROCEEDING S. 16 6.6. AT THIS JUNCTURE, WE WOULD LIKE TO RECALL THE FINDINGS OF THE EARLIER BENCH OF THIS TRIBUNAL IN THE CASE OF VARIA PRATIK ENGINEERING (SUPRA) WHEREIN IT HAS BEEN EXPLICITLY POINTED OUT THAT 41. THE ASSESSEE HAS FAIRLY CONCEDED BEFORE THE CI T (A) AS ALSO BEFORE US THAT HE HAS FULLY PARTICIPATED IN THE ENQUIRY AND T HE PROCEEDINGS RELATED TO THE ASSESSMENT FOR THE YEAR UNDER APPEAL. NO MATER IAL HAS BEEN PLACED BEFORE US TO SHOW THAT ANY OBJECTION WAS RAISED BEF ORE THE AO IN TERMS OF THE PROVISO TO S. 292 BB. IN THIS VIEW OF THE MATTER, IT SHALL NOW BE DEEMED IN TERMS OF S. 292BB THAT THE NOTICE WHICH REQUIRED TO BE SERVED AS PER THE TIME PROVISION OF S. 143(2) HAS BEEN DULY SERVED UPON TH E ASSESSEE IN TIME IN ACCORDANCE WITH THE RELEVANT PROVISIONS OF THE ACT AND, THEREFORE, THE ASSESSEE STANDS STATUTORILY PRECLUDED FROM TAKING A NY OBJECTION AT THIS STAGE THAT THE NOTICE WAS NOT SERVED UPON HIM, OR WAS NOT SERVED UPON HIM IN TIME, OR WAS SERVED UPON IN AN IMPROPER MANNER.. 6.7. IN CONSONANCE WITH THE PROPOSITION LAID DOWN IN THE FINDINGS OF THE TRIBUNAL (SUPRA) AND ALSO ELABORATE REASONS RECORDED BY THE CIT (A) IN HIS IMPUGNED ORDER UNDER DISPUTE, WE ARE OF THE CONSIDERED VIEW THAT THE AO WAS WITHIN HIS REALM TO CONCLUDE THE ASSESSMENT AND, THUS, THERE WAS NO ANY INFIRMITY WA RRANTING OUR INTERFERENCE. ACCORDINGLY, THIS GROUND GOES AGAINS T THE ASSESSEE. IT IS ORDERED ACCORDINGLY. (II) ADDITION OF RS.57,50,000/- IN THE HANDS OF THE ASSE SSEE: 7. ON A PERUSAL OF THE SEIZED MATERIALS RECEIVED F ROM THE INVESTIGATION WING, PUNE, THE AO HAD NOTICED THAT P AGE 34 WAS A SUMMARY OF THE CASH PAYMENT MADE BY SHRI SOHANRAJ M EHTA FOR THE PERIOD FROM APRIL 2003 AUGUST 2006 AS PER THE DIR ECTION OF RMD GROUP. AS PER THIS VERSION, AN AMOUNT OF RS.57.50 LAKHS PERTAINED TO SHRI SHEIKH MUSTAFMIYA HUSSAINMIYA OF AHMEDABAD AND PAGE 47 17 WAS THE MONTHLY SUMMARY FOR THE MONTH OF JANUARY MARCH 2004 OF THE UNACCOUNTED TRANSACTION CARRIED OUT BY SHRI SOH ANRAJ MEHTA C & F OF KARNATAKA REGION OF RMD GROUP. AFTER ANALYZING THE ISSUE EXHAUSTIVELY AS DETAILED IN THE ASSESSMENT ORDER AS WELL AS IN THE APPELLATE ORDER UNDER DISPUTE, A SUM OF RS.57.5 LAK HS IN CASH AS EVIDENCED BY THE SEIZED DOCUMENTS WAS TREATED AS UN ACCOUNTED RECEIPT IN THE HANDS OF THE ASSESSEE AND, ACCORDING LY, ADDED TO THE INCOME OF THE ASSESSEE FOR THE PERIOD UNDER CONSIDE RATION BY THE AO WHICH HAS BEEN SUBSEQUENTLY SUSTAINED BY THE LEARNE D CIT (A) FOR THE DETAILED REASONS RECORDED IN HIS APPELLATE ORDE R WHICH IS UNDER SCRUTINY. 7.1. ADMITTEDLY, THE WHOLE PROCEEDINGS WERE INITIA TED ON THE STRENGTH OF A STATEMENT OF A THIRD PARTY (SHRI SOHA NRAJ MEHTA). THE PURPORTED SEIZURE OF SLIPS, LOOSE SHEETS ETC. AT TH E PREMISES OF A THIRD PARTY CONTAINED ONLY THE NAMES, BUT, NOT OTHER DETA ILS SUCH AS THEIR IDENTITY, ADDRESSES, CONTACT NUMBERS ETC. ON A PE RUSAL OF THE STATEMENT, IT IS CLEAR THAT THE PAYMENTS MADE WERE TO THE PERSONS WHOSE NAMES WERE APPEARING ON THE RIGHT SIDE OF THE PAPERS (SHEETS) WHICH WERE PAID TO THOSE PERSONS ON THE INSTRUCTION S OF PRD & RD. MOREOVER, AGAINST THE NAMES OF MUSTUFA & TAUFIK, IT WAS SPECIFICALLY WRITTEN AS (PRD) EXPENDITURE IN RESPECT OF PRD WAS GIVEN BY SHRI SOHANRAJ MEHTA AS PER THE TELEPHONIC AND WRITTEN IN STRUCTION OF PRAKASH RASIKAL DHASRIWAL AND RASIKLAL MANIKCHAND D HARIWAL AS PER THE STATEMENT OF SRI SOHANRAJ MEHTA DATED 21.10.200 9 [REFER: PAGE 99 OF PB AR]. TO A QUESTION NO.14 EXHIBIT A/M/8/DA TED 9.10.2009 18 WHICH CONTAINED A BUNCH OF LOOSE SHEETS SERIALLY NU MBERED FROM 01 TO 58 TO EXPLAIN THE CONTENTS, SHRI SOHANRAJ MEHTA ANSWERED THUS PAGE 34 RECORDS RECEIPT OF GUTKHA CONSIGNMENT FROM DHARIWAL INDUSTRIES LTD., DURING APRIL 2003 TO JAN. 2006 TOTALING TO RS .218,00,91,198/- (WHICH IS RECORDED ON THE LEFT HAND SIDE OF THE PAGE). ON TH E RIGHT HAND SIDE OF THE PAGE, PARTIES TO WHOM CASH PAYMENTS WERE MADE HAVE BEEN RECORDED, ON INSTRUCTIONS FROM DHARIWAL INDUSTRIES LTD., THE IN STRUCTIONS WERE IN THE FORM OF SLIPS OF PAPER AND THEY CONTAIN THE SIGNATU RES OF MR. RASHIKLAL MANIKCHAND DHARIWAL AND HIS SON MR. PRAKASH DHARIWA L. SUCH PAYMENTS TOTALING TO RS.206,76,54,463/- WERE MADE IN 2003-20 06. THE BALANCE OF RS.11,24,36,739/- WAS SETTLED BY ME SUBSEQUENTLY OV ER A PERIOD OF TIME. 7.2. CONSIDERING THE STATEMENT OF THE SAID PERSON, THERE IS STRONG FORCE IN THE CONTENTION OF THE ASSESSEE THAT EVEN ASSUMING THAT THE RECEIPT OF SUCH AMOUNT WAS MERELY A COLLEC TION FOR ON BEHALF OF THE COMPANY AND SUCH AMOUNT CANNOT PAR TAKE THE CHARACTER OF INCOME IN THE HANDS OF THOSE PERSONS. 7.3. MOREOVER, ACCORDING TO THE ASSESSEE, THE SEAR CHED PERSON BEING A THIRD PARTY HAD RETRACTED ALL THE ST ATEMENTS RECORDED DURING THE SEARCH PROCEEDINGS IN THE FOLLOWING WORD S: 1. I REFERRED MY AFORESAID STATEMENT RECORDED BY D EPUTY COMMISSIONER OF INCOME-TAX, CENTRAL CIRCLE 2(2), BANGALORE ON 10.8. 2011. 2. IN THIS STATEMENT DATED 10.8.2011 SENSE CONVEYS THAT MY DETAILED LETTER DT.23.12.2009 FILED WITH THE ASST. DIRECTOR OF INCO ME-TAX (INVESTIGATION) UNIT 2(1), BANGALORE IS NEGATED WHICH IS INCORRECT AND U NTRUE. 3. TODAY ON 3.12.2011, SATURDAY I DEPOSE IN THE NAM E OF ALMIGHTY GOD THAT UNDER WRONG PROMISES, MISTAKEN BELIEFS, INADEQUATE GUIDANCE AND IMPROPER ADVISE, I SIGNED THE LETTER DT. 10.8.2011 IN THE IN COME-TAX DEPARTMENT, BANGALORE WHICH IS ABSOLUTELY WRONG AND NOT THE COR RECT VERSION OF WHAT I WANTED TO CONVEY TO THE INCOME-TAX DEPARTMENT AT TH AT POINT OF TIME. 4. WITH MY THIS LETTER SPECIFICALLY ADDRESSED TO Y OU, I ONCE AGAIN STATE THAT ALL MY STATEMENTS RECORDED DURING THE SEARCH PROCEEDING S ON 10.9.2009 AND MY 19 STATEMENT DATED 10.8.2011 RECORDED AT BANGALORE BEF ORE DEPUTY COMMISSIONER OF INCOME-TAX, CENTRAL CIRCLE 2(2), BA NGALORE IS RETRACTED UN- CONDITIONALLY BY ME, IT BEING IMPROPER.[REFER: PAG ES 225 27 OF THE ASSESSEES SUBMISSION DT.12.12.2012]. 7.4. THUS, THERE IS FORCE IN THE ASSESSEES CONTEN TION THAT HE SHOULD HAVE BEEN AFFORDED AN OPPORTUNITY TO CROSS-E XAMINE THE THIRD PARTY [ SHRI SHOHANRAJ MEHTA] SINCE HIS STATEMENTS ON OATH WERE COUPLED WITH INCONSISTENCY, HE RETRACTED HIS EARLI ER STATEMENTS AND, THUS, NOT ABOVE THE BOARD. 7.5. MOREOVER, THE ASSESSEES PLEA FOR PERMISSION TO CROSS EXAMINE SHRI SOHANRAJ MEHTA AT THE ASSESSMENT STAGE WAS NOT CONCEDED BY THE AO ON THE GROUND THAT - [ON PAGE 9 CIT (A)] 2.8 COMMENTS OF THE AO: (II) OPPORTUNITY OF CROSS EXAMINATION OF SHRI SOHAN RAJ MEHTA: THE ASSESSEE WAS PROVIDED WITH THE COPY OF THE STA TEMENT OF SHRI SOHANRAJ MEHTA RECORDED BY THE ADIT (INV), PUNE, AL ONG WITH DOCUMENTS ON WHICH HIS STATEMENT WAS RECORDED. DUE TO PAUCIT Y OF TIME THE CROSS EXAMINATION COULD NOT BE GRANTED. 7.6. THE CIT (A) HAD ALSO TURNED DOWN THE ASSESSEE S REQUEST FOR CROSS-EXAMINATION ON THE GROUND THAT (ON PAGE 53) 2.25.IT HAS ALSO BEEN INDICATED, AS BORNE OUT ON RECORDS, THAT THE APPELLANT HAD ASKED FOR CROSS EXA MINATION OF THE PARTY FOR THE FIRST TIME ONLY ON 14.12.2011. THE APPELLANT W AS ALSO FULLY AWARE THAT THE LIMITATION TO PASS REASSESSMENT ORDER IN THE CASE E XPIRES ON 31.12.2011. THUS, BETWEEN 29.3.2011 TILL 14.12.2011, THE APPELL ANT DID NOT MAKE ANY REQUEST TO THE AO THAT AN OPPORTUNITY OF CROSS EXAM INATION IS REQUIRED BY HIM. FULLY KNOWING THAT IT WOULD NOT BE POSSIBLE F OR THE AO TO CALL A PARTY FROM DISTANT BANGALORE AND AFFORD THE FACILITY OF C ROSS EXAMINATION DURING A SHORT PERIOD OF JUST 12 WORKING DAYS, THE APPELLANT MAKES REQUEST FOR CROSS 20 EXAMINATION. THERE IS NO DENYING THE FACT THAT CRO SS EXAMINATION IS AN INALIENABLE RIGHT OF AN AGREED PARTY BUT IT IS ALSO TRUE THAT THERE HAS TO BE A JUSTIFIABLE TIME FRAME IN WHICH SUCH RIGHT CAN BE E XERCISED. IT IS AS SETTLED PRINCIPLE OF LAW THAT RIGHTS AND DUTIES UNDER A S TATUTE GO HAND IN HAND AND CANNOT BE EXERCISED IN ISOLATION. THE APPELLANT TR ULY HAD THE RIGHT TO CROSS EXAMINATION BUT AT THE SAME TIME HAD THE DUTY TO AS K FOR IT WITHIN A REASONABLE TIME FRAME. A RIGHT EXERCISED WITH ULTE RIOR MOTIVES DOES NOT POSSESS THE SANCTION OF LAW. FACTS OF THE CASE CLEA RLY INDICATE THAT THE APPELLANT HAD PURPOSEFULLY DEMANDED CROSS EXAMINATI ON AT A TIME WHEN IT WAS CONSIDERED IMPRACTICAL AND UNFEASIBLE.. 7.7. IN ESSENCE, THE PRINCIPLES OF NATURAL JUSTIC E ON THE LEGITIMATE REQUEST OF THE ASSESSEE, TO CROSS EXAMIN E THE THIRD PARTY ON THE BASIS OF WHOSE STATEMENT THE IMPUGNED ADDITI ON SOUGHT TO BE ADDED TO HIS INCOME, HAS BEEN DENIED ON FLIMSY GROU NDS. 7.8. AT THIS POINT OF TIME, WE SHALL ANALYZE THE J UDICIAL PRONOUNCEMENTS ON A SIMILAR ISSUE, AS UNDER (PB -18 4): (I) THE HONBLE JURISDICTIONAL HIGH COURT IN THE C ASE OF DCIT V. MAHENDRA AMBALAL PATEL REPORTED IN (2010) 40 DTR (G UJ) 243 HAD HELD AS UNDER: FROM THE FINDINGS RECORDED BY THE TRIBUNAL IT IS A PPARENT THAT THOUGH IT IS THE CASE OF REVENUE THAT THE LAND HAS BEEN SOLD BY THE ASSESSEE TO GC THROUGH MV, THERE IS NO MATERIAL ON RECORD TO INDIC ATE THAT THE SAID LAND IN FACT BELONGS TO THE ASSESSEE. THOUGH THE AO HAS PL ACED RELIANCE UPON THE STATEMENTS OF MV AND GC FOR THE PURPOSE OF TAXING T HE AMOUNT IN THE HANDS OF THE ASSESSEE, DESPITE SPECIFIC REQUEST BEING MAD E BY THE ASSESSEE FOR CROSS- EXAMINING BOTH THE SAID PERSONS, THE AO HAS NOT PER MITTED THE ASSESSEE TO CROSS-EXAMINE THEM. IN THE CIRCUMSTANCES, NO RELIA NCE COULD BE PLACED UPON THE STATEMENTS OF THE SAID PERSONS AS THE ASSESSEE HAD NO OPPORTUNITY TO CROSS-EXAMINE THEM. THE STATEMENTS MADE BY THE AFO RESAID PERSONS WOULD HAVE NO EVIDENTIARY VALUE AND AS SUCH, WOULD NOT BE ADMISSIBLE IN EVIDENCE. FURTHER, THOUGH THE SAID MV HAS STATED THAT HE HAS PAID RS.60 LAKHS TO THE ASSESSEE ON BEHALF OF ONE GC, THE SAID AMOUNT HAS N OT BEEN TAXED IN THE HANDS OF GC. MOREOVER, NO EVIDENCE HAS BEEN ADDUCE D TO INDICATE THAT ANY TRANSACTION IN RELATION TO THE LAND IN QUESTION HAS ACTUALLY TAKEN PLACE. THE 21 TRIBUNAL HAS RIGHTLY FOUND THAT THE BASIS FOR MAKIN G THE ADDITION IN THE CASE OF THE ASSESSEE IS MERELY A BALD STATEMENT OF MV, W HICH IS NOT CORROBORATED WITH ANY DOCUMENTARY EVIDENCE FOUND AT THE TIME OF SEARCH, EITHER IN THE CASE OF S OR MV OR THE ASSESSEE. NO PLEA TO THE EFF ECT THAT THE IMPUGNED ORDER OF THE TRIBUNAL SUFFERS FROM ANY PERVERSITY H AS BEEN RAISED. THE TRIBUNAL HAVING BASED ITS CONCLUSION ON FINDINGS OF FACT RECORDED BY IT AFTER APPRECIATION OF THE EVIDENCE ON RECORD, IT CANNOT B E STATED THAT THE IMPUGNED ORDER OF THE TRIBUNAL SUFFERS FROM ANY LEGAL INFIRM ITY (II) DURING THE COURSE OF HEARING OF A REFERENCE A PPLICATION OF THE REVENUE IN THE CASE OF DCIT (ASST) V. PRARTHANA CONSTRUCTION PVT. LTD [TAX APPEAL NO.79 OF 2000 DATED 25.3.2001] BEFORE THE HONBLE JURISDICTIONAL HIGH COURT, THE LEARNED COUN SEL FOR THE ASSESSEE SUBMITTED THAT THE DOCUMENTS IN QUESTION H AVE BEEN FOUND FROM THE PREMISES OF A THIRD PARTY. THE LOOSE PAPE RS CANNOT BE STATED TO BE BOOKS OF ACCOUNT IN THE LIGHT OF THE D ECISION OF THE SUPREME COURT IN THE CASE OF CBI V. V.C. SHUKLA AND OTHERS (1998) 3 SCC 410 AS OBSERVED BY THE TRIBUNAL AND SUBMITTED THAT THE TRIBUNAL HAS BASED ITS CONCLUSIONS ON THE FINDINGS OF FACT RECORDED BY IT UPON APPRECIATION OF THE EVIDENCE ON RECORD; THA T THE TRIBUNAL HAD EXAMINED THE FACTS AND CIRCUMSTANCES OF THE CASE AN D HAD COME TO THE CONCLUSION THAT THE REVENUE HAD NOT BEEN ABLE T O ESTABLISH ITS CASE AGAINST THE ASSESSEE AND AS SUCH, THE ORDER OF THE TRIBUNAL BEING BASED UPON FINDINGS OF FACT RECORDED BY IT, D OES NOT GIVE RISE TO ANY QUESTION OF LAW. IT WAS, FURTHER, SUBMITTED ON BEHALF OF THE ASSESSEE THAT THE ENTIRE CASE OF THE REVENUE WAS BA SED UPON DOCUMENTS RECOVERED DURING THE COURSE OF SEARCH FRO M THE PREMISES OF THIRD PARTIES AND THE STATEMENTS OF THE THIRD PA RTIES AND THAT THE ASSESSEE WAS NOT GRANTED AN OPPORTUNITY TO CROSS EX AMINE THE THIRD PARTIES AND AS SUCH THEIR STATEMENTS HAVE NO EVIDEN TIARY VALUE. 22 AFTER DUE CONSIDERATION OF RIVAL SU BMISSIONS AND ALSO TAKING INTO ACCOUNT THE RELIANCE PLACED BY THE ASSESSEES COUNSEL IN THE CASES OF (I) KISHINCHAND CHELLARAM V. CIT (1980) 12 5 ITR 713 (SC) & (II) CIT V. S.C. SETHI (2007) 295 ITR 351 (RAJ), TH E HONBLE COURT HAD HELD THUS: [PB 174] 16. THUS, IT IS APPARENT THAT THE CONCL USIONS ARRIVED BY THE TRIBUNAL ARE BASED UPON THE AFORESAID FINDINGS OF F ACT RECORDED BY IT UPON APPRECIATION OF THE EVIDENCE ON RECORD. ON BEHALF OF THE REVENUE NOTHING IS POINTED OUT TO SHOW THAT THE FINDINGS RECORDED BY T HE TRIBUNAL ARE IN ANY MANNER PERVERSE, NOR IS IT THE CASE OF THE REVENUE THAT THE TRIBUNAL HAS TAKEN INTO CONSIDERATION ANY IRRELEVANT MATERIAL OR THAT ANY RELEVANT MATERIAL HAS BEEN IGNORED. THE CONCLUSION ARRIVED AT BY THE TRIBUNAL ON THE BASIS OF THE FINDINGS OF FACT RECORDED BY IT CANNOT IN ANY M ANNER BE SAID TO BE UNREASONABLE. IN THE AFORESAID PREMISES, THE IMPUG NED ORDER OF THE TRIBUNAL BEING BASED UPON FINDINGS OF FACT RECORDED BY IT UPON APPRECIATION OF THE EVIDENCE ON RECORD, WHICH FINDINGS HAVE NOT BEEN DISLODGED BY THE REVENUE BY POINTING OUT ANY EVIDENCE TO THE CONTRAR Y, THEREFORE, DOES NOT WARRANT ANY INTERFERENCE. 7.9. TAKING INTO ACCOUNT THE SUBMISSIONS OF THE AS SESSEE, THE STAND OF THE AO, REASONING OF THE CIT (A) IN SUSTAI NING THE ACTION OF THE AO AND ALSO IN CONFORMITY WITH THE RULINGS OF T HE HONBLE JURISDICTIONAL HIGH COURT (SUPRA), WE ARE OF THE CO NSIDERED VIEW THAT THAT LEARNED CIT (A) WAS NOT JUSTIFIED IN SUSTAININ G THE ADDITION OF RS.57.5 LAKHS MADE BY THE AO IN THE HANDS OF THE AS SESSEE FOR THE FOLLOWING REASONS: (I) THAT THE LEARNED AO HAD SOLELY DEPENDED UPON TH E INFORMATION RECEIVED FROM THE INVESTIGATION WING OF PUNE; (II) THAT THE AO HAD FAILED TO SUBSTANTIATE THE SAM E WITH ANY CREDIBLE DOCUMENTARY EVIDENCE TO THE EFFECT THAT TH E ASSESSEE HAD INDEED RECEIVED THE ALLEGED CASH PAYME NT OF RS.57.5 LAKHS FROM SHRI SOHANRAJ MEHTA AS THE ASSES SEE 23 HAD CATEGORICALLY PLEADED BEFORE THE AO THAT HE WAS MAKING PURCHASES THROUGH AMBIKA DISTRIBUTORS WHO WERE THE C & F AGENTS FOR GUJARAT REGION; (III) THAT THE TOTAL UNACCOUNTED SALES EFFECTED BY SHRI SOHANRAJ MEHTA C & F OF RMD GUTKHA ON BEHALF OF DHARIWAL INDUSTRIES LIMITED FOR THE PERIOD OF APRIL 2003 TO FEB 2008 WAS RS.345.72 CRORES (APPROX). THE UNACCOUNTED INCO ME FOR THE AY 2004-05 WAS ARRIVED AT RS.40,88,32,514/-, TH E SAME WAS ADDED SUBSTANTIVELY IN THE CASE OF M/S. DHARIVA L INDUSTRIES LIMITED AND CONCLUDED THE ASSESSMENT FOR THE AY 2004-05 U/S 153A R.W.S. 143 (3) OF THE ACT, DATED 2 9.12.2011 BY THE ACIT, C.C. 1(1), PUNE [COURTESY: P 231 238 OF PB AR]; (IV) THAT ONCE THE ALLEGED SUM OF RS.57.5 LAKHS WAS SUBJ ECTED TO TAX IN THE HANDS OF DHARIWAL INDUSTRIES LIMITED, T HE SAME CANNOT BE SUBJECTED TO SUFFER FURTHER TAX. THIS VI EW HAS BEEN FAIRLY CONCEDED BY THE CIT (A) (ON PAGE 54) 2.27.THE APPELLANT IS RIGHT TO THE EXTENT THAT NO INCOME CAN BE TAXED TWICE (V) THAT THE AO HAD CANDIDLY ADMITTED THAT DURING THE C OURSE OF ASSESSMENT PROCEEDING ITSELF THE ASSESSEE HAD SOUGH T PERMISSION TO CROSS EXAMINE SHRI SOHANRAJ MEHTA WHI CH WAS SUMMARILY REJECTED BY TAKING REFUGE ..DUE TO PAUCITY OF TIME, THE CROSS EXAMINATION COULD NOT BE GRANTED [REFER: PARA 2.8 (PAGE 10) OF THE CIT (A)S ORDE R]. THIS STAND OF THE AO, TO VIEW IT MILDLY, I S AGAINST THE SPIRIT OF JUDICIAL PRONOUNCEMENTS; (VI) THAT THE AO HAD MERELY COME TO A CONCLUSION BASED O N A STATEMENT OF A THIRD PARTY, WITHOUT BRINGING ANY CR EDIBLE DOCUMENTARY EVIDENCE TO THE CONTRARY ON RECORD TO N AIL THE ASSESSEE; & (VII) NO RELIANCE CAN BE PLACED ON THE STATEMENTS OF A TH IRD PERSON WHOSE PREMISES WERE SUBJECTED TO A SEARCH SI NCE HE HAD RETRACTED HIS OWN STATEMENT MADE EARLIER ON OAT H AND 24 PRECISELY THE ASSESSEE HAS BEEN DENIED TO CROSS-EXA MINE HIM TO BRING OUT THE TRUTH. 7.9.1 FOR THE ABOVE SAID REASONS, WE HEREBY HOLD T HAT THE ADDITION MADE FOR RS.57,50,000/- BY THE LEARNED AO ON ACCOUNT OF UNDISCLOSED INCOME, WHICH WAS FURTHER SUSTAINED BY THE LEARNED CIT(A) REQUIRES TO BE DELETED AND ACCORDINGLY, WE H EREBY DIRECT THE REVENUE TO DELETE THE SAME. THUS, GROUND NO.1 RAISE D BY THE ASSESSEE WITH RESPECT TO REOPENING OF THE ASSESSME NT U/S 148 OF THE ACT IS DISMISSED AND GROUND NO.2 WITH RESPECT TO A DDITION ON ACCOUNT OF UNDISCLOSED INCOME IS ALLOWED IN FAVOUR OF THE A SSESSEE. 8. IN THE RESULT: THE ASSESSEES APPEAL IS PARTLY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 15-02-2013 SD/- SD/- (G. C. GUPTA) VICE PRESIDENT (A. MOHAN ALANKAMONY) ACCOUNTANT MEMBER LAKSHMIKANTA DEKA/ LAKSHMIKANTA DEKA/ LAKSHMIKANTA DEKA/ LAKSHMIKANTA DEKA/- -- - COPY OF THE ORDER FORWARDED TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT CONCERNED 4. THE CIT(A) CONCERNED 5. THE DR, ITAT, AHMEDABAD 6. GUARD FILE BY ORDER ASST. REGISTRAR, ITAT, AHME DABAD 25 1. DATE OF DICTATION: -DIRECT ON COMPUTER 13-02-2 013 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE T HE DICTATING MEMBER: -02-2013 OTHER MEMBER: 3. DATE ON WHICH APPROVED DRAFT COMES TO THE SR. P. S./P.S.: 4. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE TH E DICTATING MEMBER FOR PRONOUNCEMENT: 5. DATE ON WHICH THE FAIR ORDER COMES BACK TO THE S R. P.S./P.S.: 6. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK: 7. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK: 8. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT REGISTRAR FOR SIGNATURE ON THE ORDER: 9. DATE OF DESPATCH OF THE ORDER: