C.L. Sharma, New Delhi V. DCIT, New Delhi

ITA 3202/DEL/2012

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 9723 (ITAT-DELHI)
• Duration Of Justice: 7 year(s) 6 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-01-2020
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 10-07-2017
• Assessment Year: 2007-2008
• Appeal Filed On: 21-06-2012
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: VINAY KUMAR KARAN
• Section: 143(3); 132

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH B: NEW DELHI BEFORE SHRI PRASHANT MAHARISHI, ACCOUNTANT MEMBER AND SHRI K.NARASIMHA CHARY, JUDICIAL MEMBER I.T.A. NO. 3202/DEL/2012 ASSESSMENT YEAR: 2007-08 C.L. SHARMA, 8, LOCAL SHOPPING CENTRE, VS. DCIT, CE NTRAL CIRCLE-22, 2 ND /3 RD FLOOR, VARDHMAN SIDDHARTH NEW DELHI PLAZA, SAVITA VIHAR, NEW DELHI. PAN: AATPS 2067C (APPELLANT) (RESPONDENT) ASSESSEE BY : NONE DEPARTMENT BY: SH. VINAY KUMAR KARAN, CIT-DR DATE OF HEARING: 18.12.2019 DATE OF PRONOUNCEMENT: 06.01.2020 ORDER PER K. NARASIMHA CHARY, JM AGGRIEVED BY THE ORDER DATED 8/5/2012 IN APPEAL NO. 239/08-09, PASSED BY THE LEARNED COMMISSIONER OF INCOME TAX (A PPEALS)-III, DELHI (LD. CIT(A)), FOR THE ASSESSMENT YEAR 2007-08, SH . CL SHARMA (THE ASSESSEE) FILED THIS APPEAL ON THE FOLLOWING GROUN DS:- 1. ON THE FACTS AND CIRCUMSTANCES OF CASE AND IN L AW, THE COMMISSIONER OF INCOME TAX (APPEALS) ERRED IN NOT HOL DING THAT THE AMOUNT OF RS.1,94,00,000/- WAS TO BE EXCLUDED FR OM THE TOTAL INCOME FOR THE YEAR UNDER CONSIDERATION. THE ACTION O F A.O. AND CIT(A) HAS RESULTED INTO DOUBLE TAXATION OF SAME AMOU NT. 2. ON THE FACTS AND CIRCUMSTANCES OF CASE AND IN LA W, UNDER ANY CIRCUMSTANCES, THE AMOUNT WHICH COULD HAVE BEEN 2 ADDED/TAXED AS INCOME FOR THE YEAR COULD HAVE BEEN RS.33,22,626/- AND NOT RS.1,94,00,000/-. 2. BRIEF FACTS OF THE CASE ARE THAT THERE WAS SEARC H AND SEIZURE ACTION UNDER SECTION 132 OF THE INCOME TAX ACT, 1961 (FOR SHORT THE ACT) IN THE ACCURATE GROUP OF CASES ON 26/7/2006. ASSESSEE FILE D THEIR RETURN OF INCOME ON 27/5/2008 DECLARING AN INCOME OF RS. 2,78 ,40,920/-. IN SUCH RETURN THE ASSESSEE HAD DISCLOSED A SUM OF RS. 2.70 CRORES AS ADDITIONAL INCOME SURRENDERED IN HIS STATEMENT RECORDED UNDER SECTION 132 (4) OF THE ACT AT THE TIME OF SEARCH. SUCH AMOUNT OF RS. 2 .70 CRORES REPRESENT A SUM OF RS. 1.94 CRORES KEPT IN A SECRET PLACE AND A SUM OF RS. 76 LACS ON ACCOUNT OF SALE OF LAND AT LONI, GHAZIABAD. 3. LEARNED ASSESSING OFFICER SOUGHT THE RECONCILE T HE SURRENDERED AMOUNT VIZ A-VIS THE CASH FOUND AT THE TIME OF SEAR CH. WHILE SUBMITTING THE EXPLANATION RELATING TO THE CASH FOUND, ASSESSE E SUBMITTED THAT THERE WAS A CASH BALANCE AS PER CASHBOOK OF ATL AND AML, AND THEREFORE, ALL THE CASH FOUND AT THE TIME OF SEARCH AS WELL AS AMO UNT OF RS. 1.94 CRORES KEPT IN SECRET PLACE IS COVERED AND NO FURTHER ADVE RSE INFERENCE WAS REQUIRED. ASSESSEE FURTHER SUBMITTED THAT THE ABOVE CASES ALSO INCLUDE CASH OF RS. 66 LACS ON ACCOUNT OF SALE OF LAND. 4. ON A CONSIDERATION OF THE FACTS OF THE CASE, IN THE LIGHT OF THE EXPLANATION OFFERED BY THE ASSESSEE, LEARNED ASSESS ING OFFICER OBSERVED THAT IN SO FAR AS THE CASH RELATED TO M/S ATL AND M /S AML ARE CONCERNED, NO DOCUMENTARY EVIDENCE WAS PROVIDED BY THE ASSESSE E AND ACCORDINGLY THE CASH BALANCES IF ANY IN THEIR HANDS CANNOT BE C ONSIDERED; THAT IN THE ABSENCE OF THE SPECIFIC DATE WISE DETAILS OF CASH E NTRIES IN THE CASH UTILISATION CHART SUBMITTED BY THE ASSESSEE, THE CA SH ON HAND AS PER THE 3 CHART CANNOT BE CONSIDERED TO BE AUTHENTIC; THAT TH E CASH UTILISATION CHART WAS NOT PREPARED ON THE BASIS OF SURRENDER OF ADDIT IONAL INCOME MADE BY THE ASSESSEE AND ITS GROUP COMPANIES AND IS NOT ON THE BASIS OF THE INCOME ASSESSED BY THE LEARNED ASSESSING OFFICER; T HAT THE TOTAL CASH INCLUDING THE CASH OF RS. 1.94 CRORES KEPT IN SECRE T PLACE AMOUNTING TO RS.2,78,11,930/-OUT OF WHICH THE ASSESSEE HAD SURRE NDERED ONLY A SUM OF RS. 2.70 CRORES; AND THAT, THEREFORE, THE DIFFERENC E OF RS.8,11,920/- REMAINED UNVERIFIABLE AND HAS TO BE ADDED TO THE TO TAL INCOME OF THE ASSESSEE. LEARNED ASSESSING OFFICER MADE CERTAIN OT HER ADDITIONS ALSO AND CONCLUDED THE ASSESSMENT PROCEEDINGS BY ORDER D ATED 19/12/2008 UNDER SECTION 143(3) OF THE ACT AT A TOTAL INCOME O F RS.3,23,35,250/-AS AGAINST THE RETURNED INCOME OF RS.2,78,40,920/-. 5. AGGRIEVED BY SUCH ADDITIONS, ASSESSEE PREFERRED APPEAL BEFORE THE LD. CIT(A). INSOFAR AS THE GROUNDS RAISED IN THIS A PPEAL BEFORE US, THE PLEA TAKEN BY THE ASSESSEE BEFORE THE LD. CIT(A) WAS THA T, DURING THE COURSE OF SEARCH THE ASSESSEE GROUP HAD OFFERED / DECLARED AD DITIONAL INCOME OF RS. 10 CRORES BY GIVING A TENTATIVE BREAKUP THERE F OR YEAR WISE. ACCORDING TO THE ASSESSEE THE AMOUNT WHICH COULD BE ATTRIBUTA BLE TO ANY SEIZED MATERIAL ON A PARTICULAR ISSUE WAS QUANTIFIED AND T HE BALANCE AMOUNT WHICH COULD NOT BE SO IDENTIFIED WAS DECLARED AS O THERS TO COVER UP THE TOTAL DECLARED SURRENDERED AMOUNT; AND THAT IN THAT PROCESS FOR THE ASSESSMENT YEAR 2007-08, THE FIGURE OF OTHER INCL UDE RS. 1.94 CRORES AS THE AMOUNT KEPT IN A SECRET PLACE. ASSESSEE FURTHER PLEADED THAT PURSUANT TO THE ASSESSMENT MADE IN THE GROUP CASES, VARIOUS ADDITIONS/DISALLOWANCES WERE MADE INCLUDING AN ADDI TION TO THE TUNE OF RS.1,60,77,374/-WHICH WAS NOT DISPUTED, AND ON THE OTHER HAND 4 ADMITTED, BY THE GROUP, AND, THEREFORE, IN VIEW OF ADDITION OF SUCH AMOUNT OF RS.1,60,77, 374/-OUT OF RS. 1.94 CRORES, THE REMAINING AMOUNT OF RS.33,22,626/-ALONE HAS TO BE ADDED AND NOT THE ENTIRE 1.94 CRORES. ASSESSEE ALSO CLAIMED THE SET OFF BECAUSE CERTAIN O THER ADDITIONS ARE NOT RESULTING INTO THE AVAILABILITY OF FUNDS/CASH OR BE CAUSE OF THE FACT THAT THE PART OF SUCH AMOUNT WAS NOT ACCEPTED BY THE GROUP B Y LITIGATING BEFORE THE TRIBUNAL. FOR THESE REASONS, THE SUM AND SUBSTA NCE OF THE CONTENTION OF THE ASSESSEE IS THAT ITS NOT THE ENTIRE AMOUNT OF RS. 1.94 CRORES THAT COULD BE ADDED BUT SUCH AN ADDITION HAS TO BE RESTR ICTED TO RS.33,22,626/-ONLY. 6. LD. CIT(A) CONSIDERED THE CONTENTIONS RAISED BY THE ASSESSEE AND OBSERVED THAT, THE ASSESSEE, ON BEHALF OF ACCURATE GROUP, HAD DECLARED THE ADDITIONAL INCOME OF RS. 10 CRORES AT THE TIME OF SEARCH; THAT THE INCOME DECLARED, INCLUDED THE SUM OF RS. 1.94 CRORE S ON ACCOUNT OF CASH KEPT IN A SECRET PLACE; THAT THE AMOUNT WAS ALSO RE TURNED BY THE ASSESSEE IN HIS RETURN OF INCOME; AND THAT, THEREFORE, THE A SSESSEE IS NOT HAVING ANY BASIS TO CLAIM THE EXCLUSION OF SUCH AMOUNT FRO M THE INCOME ON THE GROUND THAT ACTUALLY THERE WAS NO SUCH CASH KEPT AT THE SECRET PLACE. LD. CIT(A), THEREFORE, OPINED THAT THE CLAIM OF THE ASS ESSEE WAS MERELY AN AFTERTHOUGHT AND UNTENABLE AND, ACCORDINGLY, UPHELD THE ADDITION. AGGRIEVED BY SUCH AN ORDER ASSESSEE PREFERRED THIS APPEAL. 7. WHEN THE MATTER IS CALLED, NEITHER THE ASSESSEE NOR ANY AUTHORISED REPRESENTATIVE ENTERED APPEARANCE. IT COULD BE SEEN FROM THE RECORD THAT THE NOTICE ISSUED ON 18/11/2019 NOTING THE DATE OF HEARING AS 18/12/2019 WAS SENT TO THE ADDRESS GIVEN IN FORM NO . 36. IF THE ASSESSEE IS AVAILABLE IN SUCH ADDRESS, SUCH NOTICE SHOULD HA VE BEEN SERVED ON THE 5 ASSESSEE. IF FOR ANY REASON, THE ASSESSEE IS NOT AV AILABLE THERE, IT IS FOR THE ASSESSEE TO MAKE ARRANGEMENTS FOR SERVICE OF SUCH N OTICE BY FURNISHING THE ADDRESS WHERE THE ASSESSEE WOULD BE AVAILABLE, OR TO DELIVER IT TO SOME AUTHORISED PERSON, OR BY MAKING REQUEST TO THE POSTAL DEPARTMENT TO DETAIN THE MAIL TILL THE ASSESSEE CLAIMS THE SAM E. SINCE THE ASSESSEE DOES NOT SEEM TO HAVE ADOPTED ANY OF THESE METHODS, WE ARE THE CONSIDERED OPINION THAT NO TIME COULD BE GRANTED. B ASING ON THE RECORD WE PROCEED TO HEAR THE COUNSEL FOR REVENUE AND DECI DE THE MATTER ON MERITS. 8. IT IS THE SUBMISSION OF THE LD. DR THAT THE AMOU NT OF RS. 10 CRORES SURRENDERED BY THE ASSESSEE ON BEHALF OF THE ACCURA TE GROUP OF COMPANIES INCLUDED THE SUM OF RS. 1.94 CRORES AS TH E AMOUNT THAT WAS KEPT IT SECRET PLACE AND IT IS ALTOGETHER A DIFFERE NT AMOUNT. HE FURTHER SUBMITTED THAT THERE IS NO POINT IN THE ASSESSEE ST ATING THAT THERE IS A SEGREGATION OF THE AMOUNTS WHICH ARE ATTRIBUTABLE T O THE SEIZED MATERIAL AND WHICH COULD NOT BE IDENTIFIED, AND, THEREFORE, IT IS THE BALANCE OF THE AMOUNT OF THE SURRENDERED AMOUNT AFTER DEDUCTING TH E IDENTIFIED AMOUNT WITH REFERENCE TO THE SEIZED MATERIAL, ALONE THAT HAS TO BE TAXED IS UNTENABLE. 9. WE HAVE GONE THROUGH THE RECORD IN THE LIGHT OF THE SUBMISSIONS MADE BY THE REVENUE. IT IS THE FACTUAL FINDING OF T HE LD. CIT(A) THAT THE DISPUTED SUM OF RS. 1.94 CRORES IS A PART OF THE DE CLARED AMOUNT OF RS. 10 CRORES AND IT IS FOUND PLACE IN THE RETURN OF INCOM E FILED BY THE ASSESSEE. WE DO NOT FIND ANY BASIS TO COUNTENANCE THE CONTENT ION OF THE ASSESSEE THAT THE AMOUNT WHICH COULD BE ATTRIBUTABLE TO THE SEIZED MATERIAL WAS QUANTIFIED AND WHATEVER THE BALANCE THAT IS LEFT OU T OF THE DECLARED 6 AMOUNT, THAT ALONE WAS SHOWN AS OTHERS. THERE IS NO MATERIAL BEFORE US TO CONCLUDE THAT THE AMOUNT OF RS. 1.94 CRORES I NCLUDES THE AMOUNT OF RS.1,60,77,374/- ADDED IN THE HANDS OF THE GROUP CO MPANY IS ALSO A PART OF THE DECLARED AMOUNT OF RS. 1.94 CRORES. 10. FROM THE BEGINNING THE AMOUNT OF RS. 1.94 CRORE S IS MAINTAINED TO BE THE AMOUNT KEPT AT A SECRET PLACE. IN SUCH AN EV ENT IT HAS GOT ITS OWN IDENTITY, AND WE DO NOT FIND ANY PLAUSIBLE REASON F OR THE ASSESSEE NOW TO CONTEND THAT THE AMOUNT WHICH IS ATTRIBUTABLE TO TH E SEIZED MATERIAL HAS TO BE DEDUCTED FROM SUCH DECLARED AMOUNT OF RS. 1.9 4 CRORES. THERE IS NO FACTUAL BASIS FOR THIS SUBMISSION MADE BY THE ASSES SEE BEFORE THE LD. CIT(A). WITHOUT ANY EVIDENCE TOUCHING THIS ASPECT O R CLEAR WORKOUT, IT IS NOT POSSIBLE TO ACCEPT THE CONTENTION OF THE ASSESS EE. 11. WE THEREFORE FIND IT DIFFICULT TO SUBSCRIBE TO THE CONTENTIONS RAISED BY THE ASSESSEE BEFORE THE LD. CIT(A) AND ACCORDING LY FIND THAT THE ORDER OF THE LD. CIT(A) DOES NOT SUFFER ANY ILLEGALITY OR IRREGULARITY. WE THEREFORE WHILE UPHOLDING THE CONCLUSIONS REACHED B Y THE LD. CIT(A), FIND THE GROUNDS OF APPEAL OF THE ASSESSEE AS DEVOID OF MERITS AND THE APPEAL IS LIABLE TO BE DISMISSED. WE ACCORDINGLY DO SO. 12. IN THE RESULT, APPEAL OF THE ASSESSEE IS DISMIS SED. ORDER PRONOUNCED IN THE OPEN COURT ON 6 TH JANUARY, 2020. SD/- SD/- (PRASHANT MAHARISHI) (K.NARASIMHA CHARY) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 06/01/2020 *AKS*