Sh. Bheru Lal Bohra S/o Sh. Rang Lal Bohra, RAJSAMAND V. DCIT, UDAIPUR

ITA 303/JODH/2012

• Counselvise Citation: [2013] 140 COUNSELVISE.COM (IT) 70242 (ITAT-JODHPUR)
• Duration Of Justice: 1 year(s) 1 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-09-2013
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 05-09-2013
• Assessment Year: 2003-2004
• Appeal Filed On: 03-08-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: DR DEEPAK SEHGALCIT
• Assessee Lawyers: PRAKUL KHURANA; RAHUL LAKHWANI
• Keywords: Loose papers; Additional evidence; Block assessment
• Section: 244A; 132

Judgement Text

IN THE INCOME TAX APPELALTE TRIBUNAL: JODHPUR BENCH : JODHPUR BEFORE SHRI HARI OM MARATHA, JUDICIAL MEMBER AND SHRI N.K. SAINI, ACCOUNTANT MEMBER. ITA NO. 246/JODH/2012 (A.Y. 2005-06) & ITA NO. 303/JODH/2012 (A.Y. 2003-04) SHRI BHERU LAL BOHRA VS DCIT, S/O SHRI RANG LAL BOHRA CENTRAL CIRCLE-3, SMT. PHOOLI DEVI BOHRA, UDAIPUR. SHRI TANSUKH BOHRA, SHRI NARENDRA BOHRA, L/H LATE SHRI BHERU LAL BOHRA ARHMAN PALACE, PURANI SADAK, KELWA, RAJSAMAND PAN NO. AANPB5719L (APPELLANT) (RESPONDENT) ASSESSEE BY : SH. PRAKUL KHURANA AND SH. RAHUL LAKHWANI. DEPARTMENT BY : DR. DEEPAK SEHGAL-CIT- DR. DATE OF HEARING : 05/09/2013. DATE OF PRONOUNCEMENT : 24/09/2013. 2 O R D E R PER BENCH. : THESE TWO APPEALS BY THE ASSESSEE FOR A.YS. 2005-0 6 & 2003-04 FILED AGAINST SEPARATE ORDERS DATED 21/03/2012 AND 14/05/2012 OF LD. CIT(A), CENTRAL CIRCLE, JAIPUR ARE BEING DECIDED BY A COMMON ORDER FOR THE SAKE OF CONVENIENCE AND BREVITY. 2. IN ITA NO. 246/JODH/2012 FOLLOWING GROUNDS HAVE BEEN RAISED:- 1. UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW LD. CIT (APPEALS) HAS ERRED IN NOT HOLDING ASSE SSMENT ORDER DATED 30.11.2010 AS BAD IN LAW, WITHOUT JURIS DICTION AND ILLEGAL SINCE: A. THERE WERE NO SEARCH WARRANTS IN THE NAME OF THE APPELLANT & HENCE THE SEARCH U/S 132 ITSELF AT THE RESIDENCE OF THE APPELLANT WAS BAD IN LAW. B. THAT THE ASSESSMENT U/S 153C CANNOT BE WITHOUT RECORDING SATISFACTION IN CASE OF THE PERSON SEARCHED WHICH IS ABSENT IN THE PRESENT CASE . 2. UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW LD. CIT (APPEALS) HAS ERRED IN NOT ADMITTING AD DITIONAL 3 EVIDENCES PLACED VIDE APPLICATION DATED 23.09.2011 UNDER RULE 46A OF THE INCOME TAX RULES 1962, FOR ADMISS ION OF MEMORANDA BOOKS WHICH CONTAINS DULY RECORDED TRANSACTIONS RELATING TO THE BHERU LAI BOHARA HUF. 3. UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW LD. CIT (APPEALS) HAS ERRED IN UPHOLDING THAT A SSESSEE HAS MADE UNDISCLOSED ADVANCES OF RS. 27,67,900/- TO DIFFERENT PERSONS IN HIS INDIVIDUAL CAPACITY INSTEA D OF HIS HUF. 4. UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW LD. CIT (APPEALS) HAS ERRED IN NOT ACCEPTING TH E EXISTENCE OF BHERU LAL BOHARA HUF WHICH IS DULY SUP PORTED BY VARIOUS EVIDENCES AVAILABLE ON RECORDS. 5. UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, LD. CIT (APPEALS) HAS ERRED IN NOT PROVIDING T HE CREDIT OF INCOME OF RS. 9,00,000/- DECLARED BY THE ASSESSE E DURING DIFFERENT ASSESSMENT YEARS. 6. UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE AN D IN LAW, LD. CIT (APPEALS) HAS ERRED IN NOT GRANTING BE NEFIT OF AVAILABILITY OF OPENING DEBTORS AND IN NOT CONSIDER ING THE APPRECIATION IN THE VALUE OF DEBTORS AT A RATE AS D ECIDED BY THE ITAT IN THE CASE OF ASSESSEE DURING PREVIOUS YE ARS BLOCK ASSESSMENT. 4 7. UNDER THE FACTS & CIRCUMSTANCES OF THE CASE AND IN LAW, LD. CIT (APPEALS) HAS ERRED IN UPHOLDING THE ASSESS MENT OF RS. 2,00,000/- DECLARED BY THE ASSESSEE AS UNDISC LOSED INCOME FROM MONEY LENDING BUSINESS WITHOUT ANY INCRIMINATING MATERIAL OR EVIDENCE FOUND DURING THE COURSE OF SEARCH AND MERELY ON THE BASIS OF CONDITIONAL SU RRENDER, THAT TOO WITHOUT ACCEPTING THE CONDITIONS ATTACHED TO SUCH SURRENDER. 8. UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE AN D IN LAW, LD. CIT (APPEALS HAS ERRED IN INITIATING THE P ENALTY PROCEEDINGS U/S 271(1)(C), THUS, BY DENYING THE BENEFIT OF VOLUNTARY DISCLOSURE AS MADE BY THE ASSESSEE IN RESPECT OF UNDISCLOSED INCOME OF RS. 2,00,000/-. 3. IN ITA NO. 303/JODH/2012 (A.Y. 2003-04) FOLLOWIN G GROUNDS HAVE BEEN RAISED:- 1. UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW LD. CIT (APPEALS) HAS ERRED IN NOT HOLDING ASSE SSMENT ORDER DATED 30.11.2010 AS BAD IN LAW, WITHOUT JURIS DICTION AND ILLEGAL SINCE: A. THERE WERE NO SEARCH WARRANTS IN THE NAME OF THE APPELLANT & HENCE THE SEARCH U/S 132 ITSELF AT THE RESIDENCE OF THE APPELLANT WAS BAD IN LAW. 5 B. THAT THE ASSESSMENT U/S 153C CANNOT BE WITHOUT RECORDING SATISFACTION IN CASE OF THE PERSON SEARCHED WHICH IS ABSENT IN THE PRESENT CASE . 2. UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW LD. CIT (APPEALS) HAS ERRED IN NOT ADMITTING AD DITIONAL EVIDENCES PLACED VIDE APPLICATION DATED 23.09.2011 UNDER RULE 46A OF THE INCOME TAX RULES 1962, FOR ADMISS ION OF MEMORANDA BOOKS WHICH CONTAINS DULY RECORDED TRANSACTIONS RELATING TO THE BHERU LAL BOHARA HUF. 3. UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW LD. CIT (APPEALS) HAS ERRED IN UPHOLDING THAT A SSESSEE HAS MADE UNDISCLOSED ADVANCES OF RS. 3,43,000/- TO DIFFERENT PERSONS IN HIS INDIVIDUAL CAPACITY INSTEA D OF HIS HUF. 4. UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW LD. CIT (APPEALS) HAS ERRED IN NOT ACCEPTING TH E EXISTENCE OF BHERU LAL BOHARA HUF WHICH IS DULY SUP PORTED BY VARIOUS EVIDENCES AVAILABLE ON RECORDS. 5. UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, LD. CIT (APPEALS) HAS ERRED IN GRANTING THE BE NEFIT OF AVAILABILITY OF OPENING DEBTORS AND IN NOT CONSIDER ING THE APPRECIATION IN THE VALUE OF DEBTORS AT A RATE AS D ECICDED BY THE ITAT IN ITA NOS. 553/JODHPUR/99 AND 377/JODHPUR/2002 IN THE CASE OF THE ASSESSEE DURING THE 6 PREVIOUS YEARS BLOCK ASSESSMENT. 6. UNDER THE FACTS & CIRCUMSTANCES OF THE CASE AND IN LAW, LD. CIT (APPEALS) HAS ERRED IN UPHOLDING THE ASSESS MENT OF RS. 2,00,000/- DECLARED BY THE ASSESSEE AS UNDISC LOSED INCOME FROM MONEY LENDING BUSINESS WITHOUT ANY INCRIMINATING MATERIAL OR EVIDENCE FOUND DURING THE COURSE OF SEARCH AND MERELY ON THE BASIS OF CONDITIONAL SU RRENDER, THAT TOO WITHOUT ACCEPTING THE CONDITIONS ATTACHED TO SUCH SURRENDER. 7. UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE AN D IN LAW, LD. CIT (APPEALS HAS ERRED IN INITIATING THE P ENALTY PROCEEDINGS U/S 271(1)(C), THUS, BY DENYING THE BENEFIT OF VOLUNTARY DISCLOSURE AS MADE BY THE ASSESSEE IN RESPECT OF UNDISCLOSED INCOME OF RS. 2,00,000/-. 8. UNDER THE FACTS & CIRCUMSTANCES OF THE CASE AND IN LAW, LD. CIT (APPEALS) HAS ERRED IN UPHOLDING THE I NTEREST LIABILITY U/S 234A, 234B, 234C AND 234D OF THE ACT AND WITHDRAWING INTEREST U/S 244A OF THE ACT. 3. THE ASSESSEE IN THIS GROUND HAS CHALLENGED THE A CTION OF THE LD CIT(A) IN NOT CONSIDERING/ADMITTING THE ADDITIONAL EVIDENCES IN THE FORM OF BOOKS OF ACCOUNT OF MONEY LENDING BUSINESS OF BEHRU LAL BOHRA (HUF). 7 4. BRIEF FACTS OF THE CASE ARE THAT APPELLANT IS AN INDIVIDUAL AND DRIVES INCOME MAINLY FROM THE BUSINESS OF MINING AN D TRADING OF MARBLE AND MONEY LENDING BUSINESS. A SEARCH OPERATI ON WAS CARRIED U/S 132 OF THE IT ACT ON 03.10.2008 AT THE RESIDENTIAL PREMISES OF THE APPELLANT. THE SEARCH WARRANTS WERE IN THE NAME OF APPELLANT'S SON SHRI TANSUKH BOHARA AND SHRI NARENDRA BOHARA. DURIN G THE COURSE OF SEARCH PROCEEDINGS A LOOSE PAPER MARKED AS PAGE NO 36 OF ANNEXURE A- 2 WAS FOUND. THE SAID PAPER WAS A PROMISSORY NOTE F OR ADVANCE GIVEN TO SAVRAM BHAI OF KELWA, RAJSAMAND. THE LD AO REQUI RED THE APPELLANT TO EXPLAIN THE CONTENT OF THE SAID PAPER. IN REPLY TO WHICH THE APPELLANT SUBMITTED THAT IT IS CARRYING OUT MONEY L ENDING BUSINESS IN HIS INDIVIDUAL CAPACITY AS WELL AS UNDER THE NAME A ND STYLE OF BHERU LAL BOHARA (HUF) AND THESE LOOSE PAPERS/PROMISSORY NOTE RELATE TO HIS HUF. THE ASSESSEE SUBMITTED COMPUTERISED BOOKS OF A CCOUNTS OF BHERU LAL BOHARA HUF DURING THE COURSE OF ASSESSMENT PROC EEDINGS. 5. THE ASSESSEE VIDE HIS REPLY LETTER DATED 14.09.2 010 (COPY AVAILABLE AT PAGE NO 69 TO 82) AND REPLY DATED 30.0 9.2010 (COPY AVAILABLE AT PAGE NO 101 TO 107) BEFORE AO EXPLAINE D AT LENGTH THE METHOD OF RECORDING THE TRANSACTION WITH REGARD TO THE ANCESTRAL MONEY LENDING BUSINESS OF THE ASSESSEE. THE ASSESSE E ALSO STATED THAT 8 AS PER THE NATURE AND PREVALENT PRACTICES RELATING TO SUCH BUSINESS NO REGULAR BOOKS OF ACCOUNTS WERE MAINTAINED FOR RECOR DING THE DAY TO DAY TRANSACTION. MONEY ADVANCED TO FARMERS AND NEAR BY VILLAGERS WAS ENTERED IN BAHI/CHOPRAS. 6. THE AO WHILE PASSING THE ASSESSMENT ORDER HAS OB SERVED THAT NO BOOKS OF ACCOUNTS OF BHERU LAL BOHARA (HUF) WERE FO UND OR SEIZED AND COMPUTERIZED BOOKS OF ACCOUNTS OF BHERU LAL BOHRA ( HUF) PRODUCED BY THE ASSESSEE DURING THE COURSE OF ASSESSMENT PROCEE DINGS ARE NEITHER VERIFIABLE FROM ANY SOURCE. THE LD AO WHILE REJECTI NG THE CLAIM OF THE ASSESSEE OF EXISTENCE OF BEHERU LAL BOHARA (HUF) MA DE IN TOTAL AN ADDITION OF RS. 27,67,900/-. 7. THE ASSESSEE CAME IN APPEAL BEFORE THE LD. CIT(A ) AND FILED AN APPLICATION U/R 46A OF THE INCOME TAX RULES, 1962 F OR PLACING ON RECORD THE CHOPADAS/BAHIS OF BHERU LAL BOHARA HUF O N THE GROUND THAT THE LD. AO REFUSED TO TAKE ON RECORD THE CHOPADAS/B AHIS OF BHERU LAL BOHARA HUF. THE COPY OF THE APPLICATION IS COOPERIN G AT PAPER BOOK PAGE NO. A-27. THE LD CIT(A) CALLED FOR THE COMMENT S OF THE ASSESSING OFFICER ON THE SAID APPLICATION U/R 46A. THE SAID C OMMENTS WERE FILED ON 05.03.2012 AS APPEARING AT PAPER BOOK PAGE A-30 AND A-31. THE ASSESSEE HAS FILED A DETAILED REPLY TO TIRE SAID CO MMENTS OF THE AO VIDE 9 LETTER DATED 21.03.2011 APPEARING AT PAPER BOOK PAG E A-32 AND A-36. HOWEVER NO ORDER ADMITTING OR REJECTING THE APPLICA TION OF THE ASSESSEE U/R 46A APPEARS TO HAVE BEEN PASSED, AS TH ERE IS NO DISCUSSION OR REFERENCE OF THE SAME IN THE ORDER OF THE CIT(A) . THE LD CIT(A) WITHOUT CONSIDERING THE ADDITIONAL EVIDENCE ON RECO RD HAS PASSED THE APPELLATE ORDER HOLDING THAT THE ASSESSEE COULD NOT PROVE THE EXISTENCE OF BHERU LAL BOHARA HUF AND THE SAME IS M ERE AN AFTERTHOUGHT. 8. BEFORE US THE LD. AR HAS SUBMITTED THAT THE LD C IT(A) HAS LEGALLY ERRED IN DOUBTING THE EXISTENCE OF BHERU LAL BOHARA HUF WHEREAS THE EXISTENCE OF HUF ITSELF EVIDENT FROM THE ORDER PASS ED BY THE ITAT JODHPUR BENCH IN THE CASE OF ASSESSEE ITSELF FOR TH E BLOCK PERIOD 1987- 88 TO 1997-98 IN ITA NO 553/JDPR/99 AND 377/JDPR/02 APPEARING AT PAPER BOOK PAGE 202 TO 264A AND THE REPLIES FILED D URING THE SAID BLOCK ASSESSMENT DATED 06.03.1998 APPEARING AT PAPER BOOK PAGE 265 TO 270. MOREOVER IT WAS SUBMITTED THAT MERELY THE BOOKS OF ACCOUNT WERE NOT SEIZED DURING THE COURSE OF SEARCH DOESN'T MEAN THA T THEY WERE NOT EXISTING OR ARE NOT RELIABLE AND IN THIS REGARD PLA CED RELIANCE ON THE DECISION IN THE CASE OF AISHWARYA K RAI VS DCIT, MU MBAI (2006)105TTJ(MUMBAI)(TM). 10 9. WE HAVE GONE THROUGH THE SAID ORDER AND REPLY AN D FOUND SUBSTANCE IN THE ARGUMENTS OF THE ASSESSEE. WE FURT HER FIND THAT THE SAID ORDER AND REPLY HAVE NOT BEEN CONSIDERED BY TH E AO WHILE PASSING THE ASSESSMENT ORDER. REGARDING THE ASPECT OF NO DE CISION BEING PASSED BY THE LD. CIT(A) ON THE APPLICATION UNDER RULE 46A , THE LD AR BEFORE US HAS PLACED RELIANCE ON THE DECISION OF ITAT, MUM BAI BENCH IN THE CASE OF SHARUKH KHAN VS DCIT (2007) 13 SOT 61 (MUM) (PARA 6). IT WAS SUBMITTED THAT ONCE THE LD CIT(A) ENTERTAINED THE A DDITIONAL EVIDENCE AND CALLED FOR A REMAND REPORT ON MERIT, THEREAFTER THE SAME CANNOT BE REFUSED TO ENTERTAIN THE ADDITIONAL EVIDENCE, TH US THE ORDER OF THE LD CIT(A) DESERVES TO BE SET ASIDE. THE LD AR FURTH ER PLACED RELIANCE ON PARA 7 OF THE SAID DECISION IN SUPPORT OF THE AR GUMENTS THAT IT WOULD BE CONVENIENT AND IN THE INTEREST OF JUSTICE IF THE MATTER IS REMANDED TO THE FILE OF THE AO WITH THE DIRECTION TO EXAMINE THE ADDITIONAL EVIDENCE BY TAKING THE SAME ON RECORD AND PASS THE ASSESSMENT ORDER AFRESH. 10. THE ORDER PASSED BY THE AO AND LD. CIT(A) BE AC CORDINGLY SET ASIDE AND MATTER BE REMANDED BACK TO THE FILE OF AS SESSING OFFICER FOR DECIDING THE CASE AFRESH BY CONSIDERING THE ADDITIO NAL EVIDENCE AFTER TAKING THE SAME ON RECORD AND AFTER CONSIDERING THE OTHER MATERIAL AS DISCUSSED IN THIS ORDER AND ANY OTHER MATERIAL WHIC H THE ASSESSEE MAY 11 WISH TO RELY IN SUPPORT OF HIS CONTENTION AFTER AFF ORDING SUFFICIENT OPPORTUNITY TO THE ASSESSEE. 11. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS AL LOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE COURT ON 24 TH SEPTEMBER, 2013. SD/- SD/- (N.K.SAINI) [HARI OM MARATH A] ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 24 TH SEPTEMBER, 2013. VL/- COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT BY ORDER 4. THE CIT(A) 5. THE DR ASSISTANT REGISTRAR ITAT, JODHPUR