LATE SUNIL D GULATI, MUMBAI V. JCIT CEN CIR 39, MUMBAI

ITA 3496/MUM/2015

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 3497 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 2 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-08-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: E
• Next Hearing Date: 25-05-2016
• Assessment Year: 2003-2004
• Appeal Filed On: 08-06-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MANJUNATHA SWAMY
• Assessee Lawyers: HITESH M SHAH
• Keywords: Unexplained cash credit; Rejection of books of accounts; Unexplained expenditure; Income from undisclosed sources; Search and seizure; Additional evidence; Documents seized
• Section: 69C; 40A(3); 143(3); 153A; 133(6); 69; 148; 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI E BENCH, MUMBAI BEFORE SHRI SHAILENDRA KUMAR YADAV, JUDICIAL MEMBER, AND SHRI RAJESH KUMAR, ACCOUNTANT MEMBER. ITA. NOS. 3496 TO 3498, 4794 & 4795/MUM/2015 (ASSESSMENT YEARS: 2003-04 TO 2007-08) LATE SUNIL D GULATI, THROUGH LEGAL HEIRS SHABNAM S. GULATI 603, ELCO RESIDENCY, ALMEDA PARK, BEHIND ELCO MARKET, BANDRA (WEST), MUMBAI 400050 APPELLANT VS. JCIT, CENTRAL CIRCLE-39, GROUND FLOOR, AAYAKAR BHAVAN, M K ROAD, CHURCH GATE, MUMBAI 400 020 RESPONDENT PAN: AEHPG8703R / BY ASSESSEE : SHRI HITESH M SHAH, A.R. / BY REVENUE : SHRI. MANJUNATHA SWAMY, CIT D.R. /DATE OF HEARING : 22.06.2016 /DATE OF PRONOUNCEMENT : 19.08.2016 ORDER PER BENCH THESE FIVE APPEALS HAVE BEEN FILED BY ASSESSE AGAIN ST THE RESPECTIVE ORDERS OF COMMISSIONER OF INCOME TAX (AP PEALS)-54, MUMBAI. SINCE, THESE APPEALS PERTAIN TO SAME DECEA SED ITA NOS.3496 TO 3498, 4794 & 4795/MUM/15 A.YS. 03-0 4 TO 07-08 [LATE SUNIL D GULATI VS. CIT] PAGE 2 ASSESSEE AND ON ALMOST SIMILAR ISSUE, SO THEY ARE B EING DISPOSED OF BY COMMON ORDER FOR THE SAKE OF CONVENI ENCE. 2. IN ITA NO.3496/MUM/2015 FOR A.Y.2003-04, ASSESSE E HAS FILED THE APPEAL ON THE FOLLOWING GROUNDS: GROUND I :- ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LEARNED COMMISSIONER OF INCOME TAX (APPEAL) - 54, MUMBAI ('HEREINAFTER REFERRED TO AS 'THE CIT(A)') H AS ERRED IN CONFIRMING REJECTION OF BOOKS OF ACCOUNTS OF THE APPELLANT AND ESTIMATING THE TURNOVER AND PROFI T OF THE BUSINESS OF RS. 38,06,951/- AND RS.15,22,780/- RESPECTIVELY. THE APPELLANT BEING AGGRIEVED, PRAYS THAT THE ADDIT ION MADE ON ACCOUNT OF ESTIMATED TURNOVER AND PROFIT TO THE EXTENT OF RS. 15,22,780/- BEING UNJUSTIFIED, UNWARRANTED, BAD IN LAW AND ILLEGAL BE DELETED. GROUND II :- ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(A) HAS ERRED IN CONFIRMING THE ADDITION MADE ON ACCOUNT OF UNSECURED LOANS AS UNEXPLAINED CASH CREDIT FOR RS. 4,80,000/- U/S. 68 OF THE ACT. THE APPELLANT BEING AGGRIEVED, PRAYS THAT THE ADDIT ION MADE ON ACCOUNT OF UNEXPLAINED CASH CREDIT U/S. 68 TO THE EXTENT OF RS.4,80,000/- BEING UNJUSTIFIED, UNWARRANTED, BAD IN LAW AND ILLEGAL BE DELETED. GROUND III :- ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(A) HAS ERRED IN CONFIRMING THE ADDITION MADE ON ACCOUNT OF CURRENT LIABILITIES AS UNEXPLAIN ED CASH CREDIT FOR RS. 61,23,440/- U/S. 68 OF THE ACT. THE APPELLANT BEING AGGRIEVED, PRAYS THAT THE ADDIT ION ITA NOS.3496 TO 3498, 4794 & 4795/MUM/15 A.YS. 03-0 4 TO 07-08 [LATE SUNIL D GULATI VS. CIT] PAGE 3 MADE ON ACCOUNT OF CURRENT LIABILITIES AS UNEXPLAIN ED CASH CREDIT U/S. 68 TO THE EXTENT OF RS. 61,23,440/ - BEING UNJUSTIFIED, UNWARRANTED, BAD IN LAW AND ILLE GAL BE DELETED. GROUND IV :- ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(A) HAS ERRED IN MAKING ARE ADDITION ON ACCOUNT OF ESTIMATING WITHDRAWAL AT RS. 4,80,000 AS AGAINST OF RS. 2,34,218/- SHOWN IN CAPITAL ACCOUNT AND ADDED THE DIFFERENCE AT RS. 2,45,782/- ON ACCOUNT O F WITHDRAWALS. THE APPELLANT BEING AGGRIEVED, PRAYS THAT THE ADDIT ION MADE ON ACCOUNT OF DIFFERENCE IN ESTIMATED HIGHER WITHDRAWALS TO THE EXTENT OF RS. 2,45,782/- BEING UNJUSTIFIED, UNWARRANTED, BAD IN LAW AND ILLEGAL BE DELETED. 3. DECEASED ASSESSEE WAS AN ESTATE AGENT AND ALSO E NGAGED IN TRADING IN LAND MAINLY RELATED TO 12.5% CIDCO PL OTS. IN HIS REAL ESTATE BUSINESS, HE WAS PURCHASING AWARDED LAN D UNDER THE 12.5% SCHEME OF THE CIDCO FROM THE VILLAGERS ON BEHALF OF OTHERS AND IN TURN MANAGING SELL OF THE SAME TO VAR IOUS PARTIES. A SEARCH AND SEIZURE ACTION U/S.132 OF TH E ACT WAS CONDUCTED IN CASE OF ONE SHRI MADAN S. KOLAMBEKAR W HO WAS DEALING IN LAND. THE EVIDENCES GATHERED DURING THE COURSE OF SEARCH IN HIS CASE INDICATED CASH PAYMENT OF RS.3.5 0 CRORES TO DECEASED ASSESSEE. THEREAFTER, SEARCH AND SEIZURE A CTION U/S.132 OF THE ACT WAS CARRIED OUT IN CASE OF DECEA SED ASSESSEE ON 18.02.2009. AS STATED BY HIM IN HIS ANSWER TO Q .NO.4 IN HIS STATEMENT RECORDED U/S.132(4) OF THE ACT IN THE COURSE OF SEARCH AT HIS OFFICE ON 19.02.2009, WHILE DEALING I N 12.5% CIDCO PLOTS, THE CONSIDERATION PAID TO THE FARMERS/ INVESTORS ITA NOS.3496 TO 3498, 4794 & 4795/MUM/15 A.YS. 03-0 4 TO 07-08 [LATE SUNIL D GULATI VS. CIT] PAGE 4 WAS BOTH IN CASH AND BY CHEQUES. DURING COURSE OF SEARCH, A NUMBER OF COMPUTER GENERATED SHEETS WERE FOUND AT T HE BUSINESS PREMISES OF DECEASED ASSESSEE CONTAINING V ARIOUS DETAILS IN RESPECT OF LAND DEAL. THESE SHEETS HEREI NAFTER HAVE BEEN TERMED AS 'DEAL WISE EXCEL SHEET' (HEREINAFTER CALLED AS DWES). EACH SHEET CLAIMED TO BE CORRESPONDED TO A PARTICULAR DEAL AND SHOWED THE STATUS OF PAYMENTS A S ON A PARTICULAR DATE. THE AMOUNTS OF ON-MONEY PAID WERE FOUND TO BE NOT REFLECTED IN THE BOOKS OF ACCOUNT OF DECEASE D ASSESSEE. DURING COURSE OF POST SEARCH PROCEEDINGS ON 18.04.2 009, DECEASED ASSESSEE SUBMITTED FUND FLOW/ CASH STATEME NTS COVERING FIVE F.YS. FROM 2004-05 TO 2008-09. THESE STATEMENTS SHOWED PERSONAL CASH DEALINGS AS WELL AS THOSE RELA TING TO HIS BUSINESS. A PRELIMINARY ANALYSIS OF THESE TWO STAT EMENTS REVEALED THAT THEY HAD SEVERAL DEFECTS/ SHORTCOMING S AS OUTLINED IN PARAS 3.3 TO 3.3.4 ON PAGE 3-4 OF THE I MPUGNED ORDER FOR WHICH NO CLARIFICATION WAS ALLEGED TO BE GIVEN AT THE TIME OF ASSESSMENT PROCEEDINGS. IT WAS CONCLUDED TH AT THESE STATEMENTS DID NOT REFLECT THE TRUE AND CORRECT PIC TURE OF THE BUSINESS AND PERSONAL TRANSACTIONS OF DECEASED ASSE SSEE AND AS SUCH COULD NOT BE RELIED UPON. DECEASED ASSESSE E FILED HIS RETURN OF INCOME U/S.139 OF THE ACT FOR THE ASSESSM ENT YEAR UNDER CONSIDERATION ON 27.11.2003 DECLARING TOTAL I NCOME OF RS.6,53,507/-. THE NOTICE U/S.153A OF THE ACT DATE D 12.10.2009 WAS ISSUED AND SERVED ON THE DECEASED AS SESSEE ASKING HIM TO FILE HIS RETURN OF INCOME. IN RESPON SE, DECEASED ASSESSEE FILED HIS RETURN OF INCOME U/S.153A FOR TH E ASSESSMENT YEAR UNDER APPEAL DECLARING TOTAL INCOME AT ITA NOS.3496 TO 3498, 4794 & 4795/MUM/15 A.YS. 03-0 4 TO 07-08 [LATE SUNIL D GULATI VS. CIT] PAGE 5 RS.6,53,510/-. ASSESSEE WAS ASKED TO EXPLAIN THE S UBMISSION OF DETAILS ALONG WITH EXPLANATION OF SEIZED/ IMPOUN DED MATERIALS. ULTIMATELY, ASSESSMENT ORDER U/S.143(3) R.W.S. 153A WAS PASSED BY ASSESSING OFFICER ON 29.12.2011 FOR THE YEAR UNDER CONSIDERATION DETERMINING TOTAL INCOME O F DECEASED ASSESSEE AT RS.93,71,127/- AFTER MAKING CERTAIN ADDITIONS/DISALLOWANCES. 3.1 MATTER WAS CARRIED BEFORE THE FIRST APPELLATE A UTHORITY, WHEREIN FIRST ISSUE WAS RAISED WITH REGARD TO REJEC TION OF BOOKS OF ACCOUNTS OF DECEASED ASSESSEE AND ESTIMATION OF TURNOVER AND PROFIT OF THE BUSINESS OF RS.38,06,951/- AND RS.15,22,780/- RESPECTIVELY OUT OF TOTAL ADDITION. DURING COURSE OF ASSESSMENT PROCEEDINGS, IT WAS OBSERVED T HAT DECEASED ASSESSEE HAD NOT FURNISHED COPY OF PROFIT & LOSS ACCOUNT ALONG WITH THE SUBMISSIONS. DECEASED ASSES SEE VIDE SHOW-CAUSE NOTICE DATED 07.12.2011 WAS SPECIFICALLY ASKED AS TO WHY IN THE ABSENCE OF P & L ACCOUNT, HIS TURNOVE R AND NET PROFIT SHOULD NOT BE ESTIMATED ON THE BASIS OF DETA ILS AVAILABLE ON RECORD. IN RESPONSE TO SAME, DECEASED ASSESSEE SUBMITTED THAT EXPENSES WERE CORRECTLY CLAIMED AND SUPPORTED BY VOUCHERS/BILLS, SAME COULD NOT BE DISALLOWED. DECE ASED ASSESSEE ALSO CLAIMED THAT HIS TURNOVER WAS RS.7,87 ,560/- AND NET PROFIT WAS RS.2,80,000/- WHICH WAS 35% OF THE T URNOVER. BUT ACCORDING TO ASSESSING OFFICER, NEITHER BOOKS O F ACCOUNT NOR ANY SUPPORTING DOCUMENTS IN RESPECT OF ANY OF T HE ABOVE CLAIMS WERE PRODUCED BY DECEASED ASSESSEE. ACCORDI NG TO ASSESSING OFFICER, DECEASED ASSESSEE ALSO FAILED TO FURNISH ITA NOS.3496 TO 3498, 4794 & 4795/MUM/15 A.YS. 03-0 4 TO 07-08 [LATE SUNIL D GULATI VS. CIT] PAGE 6 EXPLANATION ABOUT CREDIT ENTRIES, APPEARING IN HIS BANK ACCOUNTS ALONG WITH SUPPORTING DOCUMENTS. UNDER THE SE CIRCUMSTANCES, IT WAS INFERRED BY ASSESSING OFFICER THAT DECEASED ASSESSEE HAD NEITHER MAINTAINED HIS BOOKS OF ACCOUNT NOR ANY SUPPORTING DOCUMENTS/DETAILS WERE T HERE. ACCORDING TO THE ASSESSING OFFICER, NON-MAINTENANCE OF BOOKS OF ACCOUNT IN A LOGICAL AND LEGAL MANNER WAS A SPEC IFIC DEFECT WHICH SHOWED THAT THE BOOKS OF ACCOUNT OF DECEASED ASSESSEE WERE NOT COMPLETE SO AS TO DEDUCE THE CORRECT PROFI T THEREFROM. HENCE, ASSESSING OFFICER OPINED THAT THE AFORESAID DEFECTS IN THE BOOKS OF ACCOUNTS CALLED FOR REJECTION OF THE S AME BY INVOKING THE PROVISIONS OF SECTION 145(3) OF THE AC T. ASSESSING OFFICER WAS OF THE VIEW THAT NON-PRODUCTION OF BOOK S AND SUPPORTING DOCUMENTS/DETAILS MADE CORRECTNESS AND COMPLETENESS OF THE BOOKS OF ACCOUNT OF DECEASED AS SESSEE QUESTIONABLE. THEREFORE, ASSESSING OFFICER BY REJE CTING THE BOOKS OF ACCOUNT OF DECEASED ASSESSEE PROCEEDED TO ESTIMATE THE DECEASED ASSESSEES INCOME. THE ASSESSING OFFIC ER ESTIMATED THE DECEASED ASSESSEES TURNOVER AT RS.38 ,06,951/- ON THE BASIS OF ENTRIES APPEARING IN HIS BANK ACCOU NTS. WHILE ESTIMATING THE TURNOVER, THE CREDIT ENTRIES ADDED U /S.68 OF THE ACT WERE DULY CONSIDERED. THEREFORE, CONSIDERING TH E DECEASED ASSESSEES OWN ESTIMATE OF NET PROFIT @35% AND AFTE R CONSIDERING THE PERSONAL CLEMENT IN VARIOUS EXPENSE S CLAIMED @ 25% AS MENTIONED, THE DECEASED ASSESSEES NET PRO FIT OF THE BUSINESS WAS ESTIMATED AT 40% OF ITS TURNOVER WHICH COMES TO RS.15,22,780/-. ACCORDINGLY, THE DECEASED ASSESSEE S NET PROFIT WAS ESTIMATED AT RS. 15,22,780/-. IN APPEAL BEFORE THE FIRST ITA NOS.3496 TO 3498, 4794 & 4795/MUM/15 A.YS. 03-0 4 TO 07-08 [LATE SUNIL D GULATI VS. CIT] PAGE 7 APPELLATE AUTHORITY, VARIOUS CONTENTIONS WERE RAISE D ON BEHALF OF DECEASED ASSESSEE AND HAVING CONSIDERED THE SAME , CIT(A) CONFIRMED THE ORDER OF ASSESSING OFFICER WHO ESTIMA TED THE NET PROFIT AT RS.15,22,780/- AFTER REJECTING THE BOOKS OF ACCOUNT. 3.2 SAME HAS BEEN OPPOSED BEFORE US INTER ALIA SUBM ITTING THAT CIT(A) WAS NOT JUSTIFIED IN CONFIRMING THE EST IMATION OF TURNOVER AND PROFIT THEREON AT RS.15,22,780/-. LD. AUTHORIZED REPRESENTATIVE SUBMITTED THAT ADDITION IN QUESTION IS NOT JUSTIFIED BY WAY OF MAKING ESTIMATION OF TURNOVER A ND PROFIT THEREON. ASSESSING OFFICER HAS NOT GIVEN ACTUAL WO RKING AS TO HOW THE ESTIMATED TURNOVER OF RS.38,06,951/- WAS CA LCULATED. THE STAND OF DECEASED ASSESSEE HAS BEEN THAT HE USE D TO DEAL IN NAVI-MUMBAI AREAS. HE USED TO IDENTIFY THOSE SU ITABLE LOCATIONS OF CIDCO PLOTS BELONGING TO DIFFERENT FAR MERS, GET THEM PROPERLY ALLOTTED TO THEM AND ENTER INTO MOUS WITH THEM FOR SALE OF THE SAID PLOTS OF LAND TO THE REAL ESTA TE DEVELOPERS WHO WERE IN NEED OF THESE PLOTS. IT WAS CLARIFIED THAT THOUGH HE WAS NOT BUYING AND SELLING THE PLOTS ON HIS OWN, YE T HE, AS A BROKER, NEGOTIATED THE DEALS BETWEEN THE SELLER-CUM -FARMERS AND THE BUYERS-CUM-DEVELOPERS-BUILDERS. SINCE, DECE ASED ASSESSEE EARNED REASONABLE AMOUNT OF COMMISSION IN THE REAL ESTATE DEALS MADE THROUGH HIM. DECEASED ASSESSEE W AS DOING SAID BUSINESS FOR DEVELOPERS/INVESTOR AS STATED ABO VE. ASSESSING OFFICER DID NOT AGREE WITH THE CONCEPT OF COMMISSION AGENCY BY ASSESSEE. SINCE, ASSESSING OFFICER DID N OT ACCEPT THE BOOKS OF ACCOUNT, SO, HE ESTIMATED THE TURNOVER AND PROFIT THEREON. LD. AUTHORIZED REPRESENTATIVE SUBMITTED T HAT THESE ITA NOS.3496 TO 3498, 4794 & 4795/MUM/15 A.YS. 03-0 4 TO 07-08 [LATE SUNIL D GULATI VS. CIT] PAGE 8 ADDITIONS ARE NOT BASED ON THE SEIZED MATERIALS AT THE TIME OF SEARCH AS DISCUSSED ABOVE, BUT ONLY ON THE BASIS OF CASH FLOW STATEMENT PREPARED BY ASSESSEE IRRESPECTIVE OF CORR ELATION TO SEARCH MATERIAL. SO, ADDITION IN QUESTION HAS NO N EXUS WITH SEARCH MATERIAL, SO, ADDITION IS NOT JUSTIFIED IN V IEW OF DECISION OF ALL CARGO GLOBAL LOGISTIC LTD. SO, IN THE PROCEE DINGS AFTER SEARCH IN THE ASSESSMENT U/S.153A OF THE ACT ADDITI ON SHOULD HAVE NEXUS WITH SEIZED MATERIAL FOUND AT THE TIME O F SEARCH. WITHOUT PREJUDICE TO ABOVE, ESTIMATION OF TURNOVER AND PROFIT THEREON IN QUESTION IS ALSO NOT BASED ON MATERIAL O N RECORD. AGREEING TO ALTERNATIVE CONTENTION OF ASSESSEE, WE FIND THAT ASSESSEE HAD BEEN DOING AGENCY WORK ON BEHALF OF OT HER PARTIES. THERE IS NOTHING ON RECORD TO SUGGEST THA T ASSESSEE WAS DOING THE SAID TRANSACTION AT HIS OWN. ASSESSI NG OFFICER HAS NOT BROUGHT ANYTHING ON RECORD TO SUGGEST THAT ABOVE LAND TRANSACTION WERE DONE BY ASSESSEE IN HIS NAME. IT COULD HAVE BEEN CORROBORATED BY ASSESSING OFFICER WITH REAL IN STANCES OF TRANSACTION WHICH HAS NOT BEEN DONE BY HIM. IN SUCH SITUATION, ASSESSEE CANNOT BE TAXED ON THE BASIS OF ON MONEY TRANSACTION OF ITS CLIENT. SO, ADDITION IN HAND OF ASSESSEE IS NOT JUSTIFIED. SAME IS DIRECTED TO BE DELETED. 4. NEXT ISSUE IS WITH REGARD TO ADDITION MADE ON AC COUNT OF UNSECURED LOAN AS UNDISCLOSED CASH CREDIT OF RS.4,8 0,000/-. ASSESSING OFFICER MADE ADDITION OF RS.6,80,000/- OF UNSECURED LOANS TREATING AS UNEXPLAINED CASH CREDIT. ASSESSI NG OFFICER OBSERVED THAT DECEASED ASSESSEE HAD SHOWN UNSECURED LOAN OF RS.6,80,000/- (RAMESH HOMES BUILDING & DEVELOPER ITA NOS.3496 TO 3498, 4794 & 4795/MUM/15 A.YS. 03-0 4 TO 07-08 [LATE SUNIL D GULATI VS. CIT] PAGE 9 RS.1,80,000, SAFAR REAL ESTATE RS.2,00,000 AND SHUB HAM ESTATE CONSULTANT RS.3,00,000). ASSESSING OFFICER ASKED TO ASSESSEE AS TO WHY SAME SHOULD NOT BE ADDED AS UNEX PLAINED CASH CREDIT U/S.68 OF THE ACT. ASSESSEE SUBMITTED RELEVANT DETAILS LIKE; ADDRESS, PAN, HIS BANK ACCOUNT STATEM ENT AND PARTIES BANK ACCOUNT STATEMENTS, ACCOUNT CONFIRMAT ION LETTERS, COPY OF PARTIES INCOME TAX RETURNS ETC. BUT ASSES SING OFFICER AFTER REJECTING THE CONTENTION ON BEHALF OF DECEASE D ASSESSEE MADE ADDITION IN QUESTION. 4.1 MATTER WAS CARRIED BEFORE THE FIRST APPELLATE A UTHORITY, WHEREIN CIT(A) CONFIRMED RS.4,80,000/- OUT OF RS.6, 80,000/-. THERE IS NOTHING ON RECORD TO SUGGEST THAT REVENUE IS AGAINST PARTIAL RELIEF GRANTED BY CIT(A). SO, NARROW ISSUE BEFORE US IS REGARDING CONFIRMATION OF RS.4,80,000/- MADE U/S.68 OF THE ACT. THE STAND OF DECEASED ASSESSEE HAS BEEN THAT DECEASED ASSESSEE HAS ACCEPTED RS. 3 LACS AND RS.1,80,000/- FROM M/S.SHUBHAM ESTATE CONSULTANTS AND M/S. RAMESH HOME S BUILDING & DEVELOPER RESPECTIVELY, ASSESSING OFFICE R HAS ACCEPTED THAT THOUGH CONFIRMATIONS FROM THE SAID PA RTIES WERE FILED BUT THEY DID NOT APPEAR BEFORE ASSESSING OFFI CER. WITHOUT PREJUDICE TO ABOVE, STAND OF ASSESSEE HAS BEEN THAT THE ABOVE ADDITION IN QUESTION IS HAVING NO NEXUS WITH THE SE IZED MATERIAL FOUND DURING COURSE OF SEARCH IN QUESTION. SO, ADDITION IS NOT JUSTIFIED IN VIEW OF RATIO LAID DOW N IN ALL CARGO GLOBAL LOGISTIC LTD. (SUPRA). AGREEING TO THE CONT ENTION OF LD. AUTHORIZED REPRESENTATIVE, WE ARE OF THE VIEW THAT ASSESSING OFFICER WAS NOT JUSTIFIED IN MAKING ADDITION U/S.68 OF THE ACT ITA NOS.3496 TO 3498, 4794 & 4795/MUM/15 A.YS. 03-0 4 TO 07-08 [LATE SUNIL D GULATI VS. CIT] PAGE 10 WITHOUT MAKING NEXUS OF THE SAME WITH THE SEIZED MA TERIAL FOUND AT THE TIME OF SEARCH. MOREOVER, NON APPEARA NCE OF CREDITOR BEFORE ASSESSING OFFICER IS NOT SOUND BASI S OF ADDITION IN QUESTION WHILE THEY HAVE CONFIRMED THE SAME AND ALL DETAILS OF PARTIES WERE WITH ASSESSING OFFICER AT RELEVANT POINT OF TIME INCLUDING THEIR PAN NUMBER. ASSESSING OFFICER HAS NOT EXERCISE HIS OPTION TO SUMMON PARTIES TO VERIFY THE FACT WHICH HAS NOT BEEN DONE FOR THE REASONS KNOWN TO HIM. SO , ADDITION IN QUESTION IS NOT JUSTIFIED. SAME IS DIRECTED TO BE DELETED. 5. NEXT ISSUE IS WITH REGARD TO ADDITION OF RS.61,2 3,440/- U/S.68 ON ACCOUNT OF CURRENT LIABILITIES AS UNEXPLA INED CASH CREDIT. ASSESSING OFFICER MADE ADDITION OF CURRENT LIABILITIES U/S.68 OF THE ACT OF RS.61,23,440/- TREATING ALL CU RRENT LIABILITIES AS UNEXPLAINED CASH CREDIT. ASSESSING OFFICER OBSERVED THAT DECEASED ASSESSEE HAS SHOWN CURRENT L IABILITIES OF RS.61,23,440/- COMPRISING ADVANCES RECEIVED FROM SAI AMRUT RS.3,23,440/- AND HAWARE ENGG. & BUILDERS PVT . LTD. RS.58,00,000/-. ASSESSEE WAS ASKED TO FURNISH VAR IOUS DETAILS IN RESPECT OF SUCH ADVANCES. ACCORDING TO ASSESSING OFFICER, ASSESSEE FAILED TO ESTABLISH THE IDENTITY AND CREDITWORTHINESS OF AFORESAID PARTIES AND GENUINENE SS OF SUCH TRANSACTIONS U/S.68 OF THE ACT. SO, SAME WAS ADDED TO THE INCOME OF DECEASED ASSESSEE. 5.1 MATTER WAS CARRIED BEFORE THE FIRST APPELLATE A UTHORITY, WHEREIN VARIOUS CONTENTIONS WERE RAISED ON BEHALF O F DECEASED ASSESSEE AND HAVING CONSIDERED THE SAME, CIT(A) CON FIRMED THE ORDER OF ASSESSING OFFICER. THE STAND OF ASSESSEE HAS BEEN THAT ITA NOS.3496 TO 3498, 4794 & 4795/MUM/15 A.YS. 03-0 4 TO 07-08 [LATE SUNIL D GULATI VS. CIT] PAGE 11 VIDE LETTER DATED 14.12.2011 ALL DETAILS OF CURRENT LIABILITIES ON 19.12.2011 WERE SUBMITTED. IT WAS STATED THAT THES E AMOUNTS WERE RECEIVED FROM THE SAID TWO PARTIES AS ADVANCE FOR THE PURCHASE OF LAND. IT WAS POINTED OUT THAT TILL THE TIME THE LANDS WERE HANDED OVER TO THEM AND THOSE AMOUNTS WE RE WRONGLY REFLECTED AS LIABILITIES OWNED BY DECEASED ASSESSEE TO THOSE PARTIES. SINCE, DECEASED ASSESSEE HAD FILED CONFIRMATION FROM BOTH PARTIES, ADDITION OF RS.61,23,440/- WAS N OT WARRANTED. DECEASED ASSESSEE HAS CATEGORICALLY GIV EN THE DETAILS OF PARTIES AND TRANSACTIONS THEREWITH. ONC E TRANSACTION WAS STATED TO BE COMPLETED, SO, IT WAS NO MORE LIAB ILITY. ALL DETAILS IN THIS REGARD WERE FILED BEFORE REVENUE AU THORITIES. ASSESSEE HAS TRIED TO PROVE THE IDENTITY BY GIVING DETAILS OF PARTIES. AGREEING TO ALTERNATE CONTENTION OF ASSES SEE, WE HOLD THAT ADDITION IN QUESTION HAVING NO NEXUS WITH SEIZ ED MATERIAL AS DISCUSSED ABOVE, SO IN VIEW OF THE RATIO LAID DO WN IN ALL CARGO GLOBAL LOGISTIC LTD. (SUPRA), ADDITION U/S.68 OF THE ACT IS NOT JUSTIFIED. UNDER FACTS AND CIRCUMSTANCES, THE ADDITION IN QUESTION IS DIRECTED TO BE DELETED. 6. NEXT ISSUE IS WITH REGARDS TO ADDITION OF RS.6,6 5,782/- ON ACCOUNT OF ESTIMATING WITHDRAWAL AT RS.4,80,000/- A S AGAINST RS.2,34,218/- SHOWN IN CAPITAL ACCOUNT. ASSESSING OFFICER ESTIMATED WITHDRAWALS AT RS.4,80,000/- AS AGAINST R S. 2,34,218/- ON ACCOUNT OF HOUSEHOLD EXPENSES. THE S TAND OF DECEASED ASSESSEE HAS BEEN THAT THIS ADDITION IS ON THE BASIS OF PURELY ON ESTIMATION AND HAVING NO NEXUS WITH TH E SEIZED MATERIAL FOUND AT THE TIME OF SEARCH. AGREEING TO THE ITA NOS.3496 TO 3498, 4794 & 4795/MUM/15 A.YS. 03-0 4 TO 07-08 [LATE SUNIL D GULATI VS. CIT] PAGE 12 CONTENTION ON BEHALF OF ASSESSEE AND IN VIEW OF RAT IO LAID DOWN IN ALL CARGO GLOBAL LOGISTIC LTD. (SUPRA) AS DISCUS SED ABOVE, ADDITION IN QUESTION IS NOT JUSTIFIED. SAME IS DIR ECTED TO BE DELETED. 7. AS A RESULT, APPEAL FILED BY DECEASED ASSESSEE F OR A.Y.2003-04 IS ALLOWED AS DISCUSSED ABOVE. 8. IN ITA NO.3497/MUM/2015 FOR A.Y.2004-05, DECEASE D ASSESSEE HAS FILED THE APPEAL ON THE FOLLOWING GROU NDS: GROUND I :- ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LEARNED COMMISSIONER OF INCOME TAX (APPEAL) - 54, MUMBAI ('HEREINAFTER REFERRED TO AS 'THE CIT(A)') H AS ERRED IN UPHOLDING THE ADDITION MADE ON ACCOUNT OF DEAL WISE EXCEL SHEET FOR A SUM OF RS.1,30,000/- AS UNEXPLAINED EXPENDITURE U/S.69C OF THE ACT. THE APPELLANT BEING AGGRIEVED, PRAYS THAT THE ADDIT ION MADE ON ACCOUNT OF UNEXPLAINED EXPENDITURE TO THE EXTENT OF RS. 1,30,000/- BEING UNJUSTIFIED, UNWARRANTED, BAD IN LAW AND ILLEGAL BE DELETED. GROUND II :- ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(A) HAS ERRED IN CONFIRMING THE ADDITION MADE ON ACCOUNT OF OTHER CASH / UNACCOUNTED TRANSACTION FOR RS.1,00,000/- BY TREATING IT AS UNEXPLAINED EXPENDITURE U/S.69C OF THE ACT. THE APPELLANT BEING AGGRIEVED, PRAYS THAT THE ADDIT ION MADE ON ACCOUNT OF UNEXPLAINED CASH CREDIT U/S. 69C TO THE EXTENT OF RS.1,00,000/- BEING UNJUSTIFIED, UNWARRANTED, BAD IN LAW AND ILLEGAL BE DELETED. GROUND III :- ITA NOS.3496 TO 3498, 4794 & 4795/MUM/15 A.YS. 03-0 4 TO 07-08 [LATE SUNIL D GULATI VS. CIT] PAGE 13 ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(A) HAS ERRED IN CONFIRMING THE ADDITION MADE ON ACCOUNT OF CURRENT LIABILITIES AND UNSECURE D LOANS AS UNEXPLAINED CASH CREDIT FOR RS. 51,68,811/ - U/S. 68 OF THE ACT. THE APPELLANT BEING AGGRIEVED, PRAYS THAT THE ADDIT ION MADE ON ACCOUNT OF CURRENT LIABILITIES AND UNSECURE D LOANS AS UNEXPLAINED CASH CREDIT U/S. 68 TO THE EXT ENT OF RS. 51,68,811/- BEING UNJUSTIFIED, UNWARRANTED, BAD IN LAW AND ILLEGAL BE DELETED. GROUND IV :- ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(A) HAS ERRED IN CONFIRMING THE ADDITION MADE ON ACCOUNT OF DIFFERENCE IN ESTIMATED HIGHER WITHDRAWALS OF RS. 4,27,716/- THAN SHOWN IN CAPITA L ACCOUNT AT RS. 1,72,284/- ON ACCOUNT OF WITHDRAWALS . THE APPELLANT BEING AGGRIEVED, PRAYS THAT THE ADDIT ION MADE ON ACCOUNT OF DIFFERENCE IN ESTIMATED HIGHER WITHDRAWALS TO THE EXTENT OF RS. 4,27,716/- BEING UNJUSTIFIED, UNWARRANTED, BAD IN LAW AND ILLEGAL BE DELETED. GROUND V :- ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(A) HAS ERRED IN CONFIRMING THE DISALLOWANCE OF RS.51,229/- MADE ON ACCOUNT OF PERSONAL ELEMENT IN CERTAIN EXPENSES. THE APPELLANT BEING AGGRIEVED PRAYS THAT THE ADDITI ON MADE ON ACCOUNT OF ESTIMATED PERSONAL ELEMENT IN CERTAIN EXPENSES TO THE EXTENT OF RS. 51,229/- BEIN G UNJUSTIFIED, UNWARRANTED, BAD IN LAW AND ILLEGAL BE DELETED. 9. FIRST ISSUE IN THIS APPEAL IS WITH REGARD TO ADD ITION OF RS.1,30,000/- AS UNEXPLAINED EXPENDITURE U/S.69C OF THE ACT. ITA NOS.3496 TO 3498, 4794 & 4795/MUM/15 A.YS. 03-0 4 TO 07-08 [LATE SUNIL D GULATI VS. CIT] PAGE 14 ASSESSING OFFICER MADE ADDITION OF RS. 1,30,000/- O N ACCOUNT OF DEAL WISE EXCEL SHEET. IN HIS ANSWER TO QUESTIO N NO. 4, STATEMENT RECORD DURING COURSE OF SEARCH IN HIS OFF ICE, DECEASED ASSESSEE CATEGORICALLY STATED THAT WHILE DEALING IN 12.5% CIDCO PLOTS, THE CONSIDERATION PAID TO THE FARMERS/INVESTORS WAS BOTH IN CASH AND BY CHEQUES. DURING COURSE OF SEARCH, A NUMBER OF COMPUTER GENERATED SH EETS WERE FOUND AT THE BUSINESS PREMISES OF DECEASED ASSESSEE CONTAINING VARIOUS DETAILS IN RESPECT OF EACH PARTI CULAR LAND DEAL. THESE SHEETS HEREINAFTER HAVE BEEN TERMED AS DEAL WISE EXCEL SHEET (DWES). EACH SHEET CORRESPONDED TO A PARTICULAR DEAL AND SHOWED THE STATUS OF PAYMENTS MADE BY CHEQ UE AS WELL AS IN CASH AS ON A PARTICULAR DATE. THE AMOUN TS OF ON- MONEY PAID WERE FOUND TO BE NOT REFLECTED IN THE B OOKS OF ACCOUNT OF DECEASED ASSESSEE. DURING COURSE OF POS T SEARCH PROCEEDINGS ON 18.04.2009, DECEASED ASSESSEE SUBMIT TED FUND FLOW/CASH FLOW STATEMENTS COVERING FIVE F.YS. FROM 2004-05 TO 2008-09. THESE STATEMENTS SHOWED PERSONAL CASH DEAL INGS AS WELL AS THOSE RELATING TO HIS BUSINESS. ACCORDING TO ASSESSING OFFICER, A PRELIMINARY ANALYSIS OF THESE TWO STATEM ENTS REVEALED THAT THEY HAD SEVERAL DEFECTS/ SHORTCOMINGS AS OUTL INED IN PARAS 3.3 TO 3.3.4 ON PAGE 3-4 OF THE IMPUGNED ORDE R FOR WHICH NO CLARIFICATION WAS GIVEN AT THE TIME OF ASSESSMEN T. SO, HE CONCLUDED THAT THESE STATEMENTS DID NOT REFLECT THE TRUE AND CORRECT PICTURE OF THE BUSINESS AND PERSONAL TRANSA CTIONS OF DECEASED ASSESSEE AND AS SUCH COULD NOT BE RELIED U PON. DECEASED ASSESSEE WAS ASKED TO FURNISH COMPLETE DETAILS/EXPLANATION IN RESPECT OF ALL SUCH DWES ALO NG WITH ITA NOS.3496 TO 3498, 4794 & 4795/MUM/15 A.YS. 03-0 4 TO 07-08 [LATE SUNIL D GULATI VS. CIT] PAGE 15 SUPPORTING DOCUMENTS AND EVIDENCES. ASSESSING OFFI CER NOTICED THAT PAYMENTS IN CASH WERE REFLECTED NEITHE R IN DECEASED ASSESSEES BOOKS OF ACCOUNT PRODUCED DURIN G THE COURSE OF ASSESSMENT PROCEEDINGS NOR IN THE CASH FL OW STATEMENT OF HIS BUSINESS. AS MENTIONED IN PARA 7. 2 OF THE IMPUGNED ORDER, DOCUMENTS MARKED ANNEXURES A-L AND A-3 IMPOUNDED FROM ARENJA OFFICE AND ANNEXURE A-2 SEIZE D FROM KAVERI PREMISES CONTAIN SUCH DWES. ON THE BASIS OF THESE DOCUMENTS, ASSESSMENT YEAR-WISE CASH PAYMENTS WERE ANALYSED AND IT WAS FOUND THAT CASH PAYMENTS AMOUNT ING TO RS.1,30,000/-PERTAINED TO A.Y.2004-05 WHICH WERE NO T REFLECTED IN DECEASED ASSESSEE'S BOOKS OF ACCOUNT. IN VIEW OF ABOVE, THE AMOUNT OF UNACCOUNTED CASH PAYMENTS OF RS.1,30,000/- WAS HELD AS UNEXPLAINED EXPENDITURE U /S.69C OF THE ACT, WHICH WAS CONFIRMED BY CIT(A). 9.1 WE FIND THAT ASSESSEE HAD BEEN DOING AGENCY WOR K ON BEHALF OF OTHER PARTIES. THERE IS NOTHING ON RECOR D TO SUGGEST THAT ASSESSEE WAS DOING THE SAID TRANSACTION AT HIS OWN. ASSESSING OFFICER HAS NOT BROUGHT ANYTHING ON RECOR D TO SUGGEST THAT ABOVE LAND TRANSACTION WERE DONE BY HI M IN HIS PERSONAL CAPACITY. IN SUCH SITUATION, ASSESSEE CAN NOT BE TAXED ON THE BASIS OF ON INVESTMENT TRANSACTION OF ITS CL IENT. SO, ADDITION IN HAND OF ASSESSEE IS NOT JUSTIFIED. SAM E IS DIRECTED TO BE DELETED. 10. NEXT ISSUE IS WITH REGARDS TO ADDITION MADE ON ACCOUNT OF OTHER CASH/UNACCOUNTED TRANSACTION OF RS.1 LAC BY T REATING IT AS UNEXPLAINED EXPENDITURE U/S.69C OF THE ACT. ASS ESSING ITA NOS.3496 TO 3498, 4794 & 4795/MUM/15 A.YS. 03-0 4 TO 07-08 [LATE SUNIL D GULATI VS. CIT] PAGE 16 OFFICER MADE ADDITION OF RS.1 LAC BY TREATING UNEXP LAINED CASH PAYMENT AS MENTIONED ON PAGE NO.14 OF ANNEXURE A-1 IMPOUNDED FROM ARNEJA OFFICE OF DECEASED ASSESSEE U /S.69C OF THE ACT. THE STAND OF DECEASED ASSESSEE HAS BEEN T HAT HE WAS ONLY AGENT VIZ. DEAL MAKER. SO, FOLLOWING REASONIN G AS DISCUSSED IN PARA 9.1 OF THIS ORDER, ADDITION IN QU ESTION IS DIRECTED TO BE DELETED. 11. NEXT ISSUE IS WITH REGARD TO ADDITION MADE ON A CCOUNT OF CURRENT LIABILITIES AND UNSECURED LOAN AS CASH CRED IT OF RS.51,68,811/- U/S.68 OF THE ACT. ASSESSEE HAS SHO WN CURRENT LIABILITIES OF RS.1,09,68,811/- AGAINST VARIOUS PAR TIES NARRATIONS. SINCE, DECEASED ASSESSEE WAS NOT ABLE T O GIVE SATISFACTORY ANSWER TO THE ASSESSING OFFICER, SO, S AME WAS U/S.68 OF THE ACT TO THE TUNE OF RS.1,09,68,811/-. 11.1 MATTER WAS CARRIED BEFORE THE FIRST APPELLATE AUTHORITY, WHEREIN VARIOUS CONTENTIONS WERE RAISED ON BEHALF O F ASSESSEE. AS STATED ABOVE, ASSESSING OFFICER HAS STATED THAT CURRENT LIABILITIES AGGREGATING TO RS.1,09,68,811/- AS UNEX PLAINED CASH CREDIT U/S.68 OF THE ACT AS DECEASED ASSESSEE FAILE D TO DISCHARGE HIS ONUS BY NOT ESTABLISHING THE IDENTITY AND CREDITWORTHINESS OF CONCERNED PARTIES AS WELL AS GE NUINENESS OF TRANSACTIONS AT THE TIME OF ASSESSMENT. IN APPEAL, CIT(A) RESTRICTED THE ADDITION TO RS.51,68,811/- OUT OF CU RRENT LIABILITIES. THE STAND OF ASSESSEE HAS BEEN THAT H E WAS BROKER IN REAL ESTATE AS DISCUSSED ABOVE. HE WAS DOING DE AL ON BEHALF OF OTHER I.E. PURCHASING LAND FROM FARMERS 1 2.5% CIDCO PLOTS FACILITATED TO THE SAME THEREAFTER TO THE MAI N INVESTORS. ITA NOS.3496 TO 3498, 4794 & 4795/MUM/15 A.YS. 03-0 4 TO 07-08 [LATE SUNIL D GULATI VS. CIT] PAGE 17 AS STATED ABOVE, ASSESSEE WAS BROKER, TRANSACTIONS WERE DOEN ON BEHALF OF INVESTOR. ASSESSING OFFICER HAS BROUG HT NOTHING ON RECORD TO SUGGEST THAT AS IN FACT DEALING IN LAN D AS PARTIES. SAME COULD BE DONE BY MAKING NEXUS TO LAND DEAL. B UT, ON SUCH EFFORT HAS BEEN MADE BY REVENUE AUTHORITIES. IN VIEW OF ABOVE DISCUSSION, ADDITION IN QUESTION IS NOT JUSTI FIED. SAME IS DIRECTED TO BE DELETED. 12. NEXT ISSUE IS WITH REGARD TO HOUSEHOLD WITHDRAW ALS. IN ADDITION ON ACCOUNT OF HOUSEHOLD WITHDRAWALS IS NOT JUSTIFIED BECAUSE, THERE IS NOTHING ON RECORD TO SUGGEST THAT SAME HAD ANY NEXUS WITH THE SEIZED MATERIAL FOUND DURING COU RSE OF SEARCH. SO, ADDITION IN QUESTION IS HAVING NO NEXUS WITH THE SEIZED MATERIAL, SO, ADDITION IN QUESTION IS NOT JU STIFIED IN ASSESSMENT U/S.153A OF THE ACT. SAME IS DIRECTED T O BE DELETED. 13. NEXT ISSUE IS WITH REGARD TO DISALLOWANCE OF RS .51,229/- MADE ON ACCOUNT OF PERSONAL ELEMENT ON CERTAIN EXPE NSES. AGAIN THIS DISALLOWANCE IS NOT BASED ON SEIZED MATE RIAL FOUND DURING COURSE OF SEARCH, SO ADDITION IS NOT JUSTIFI ED UNDER THE PROVISIONS OF SECTION 153A OF THE ACT IN VIEW OF RA TIO OF ALL CARGO GLOBAL LOGISTIC LTD. (SUPRA). ASSESSING OFFI CER IS DIRECTED TO DELETE THE SAME. 14. AS A RESULT, THIS APPEAL IS ALLOWED. 15. IN ITA NO.3498/MUM/2015 FOR A.Y.2005-06, DECEAS ED ASSESSEE HAS FILED THE APPEAL ON THE FOLLOWING GROU NDS: ITA NOS.3496 TO 3498, 4794 & 4795/MUM/15 A.YS. 03-0 4 TO 07-08 [LATE SUNIL D GULATI VS. CIT] PAGE 18 GROUND I :- ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LEARNED COMMISSIONER OF INCOME TAX (APPEAL) - 54, MUMBAI ('HEREINAFTER REFERRED TO AS 'THE CIT(A)') H AS ERRED IN MAKING PROTECTIVE ASSESSMENT OF RS.63,51,926/- OF ALL DEPOSITS OF AN ACCOUNT HELD B Y HUF INTO INDIVIDUAL HAD EVEN ON MERITS ALL DEPOSITS WITHOUT LOOKING INTO INCOME PART OF THE TRANSACTION . THE APPELLANT BEING AGGRIEVED, PRAYS THAT THE ADDIT ION MADE ON ACCOUNT OF UNACCOUNTED BANK ACCOUNTS TO THE EXTENT OF RS. 63,51,926/- BEING UNJUSTIFIED, UNWARRANTED, BAD IN LAW AND ILLEGAL BE DELETED. GROUND II :- ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LEARNED COMMISSIONER OF INCOME TAX (APPEAL) - 54, MUMBAI ('HEREINAFTER REFERRED TO AS 'THE CIT(A)') H AS ERRED IN UPHOLDING THE ADDITION MADE ON ACCOUNT OF DEAL WISE EXCEL SHEET FOR A SUM OF RS.1,71,000/- AS UNEXPLAINED EXPENDITURE U/S.69C OF THE ACT. THE APPELLANT BEING AGGRIEVED, PRAYS THAT THE ADDIT ION MADE ON ACCOUNT OF UNEXPLAINED EXPENDITURE TO THE EXTENT OF RS.1,71,000/- BEING UNJUSTIFIED, UNWARRANTED, BAD IN LAW AND ILLEGAL BE DELETED. GROUND III :- ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(A) HAS ERRED IN CONFIRMING THE ADDITION MADE ON ACCOUNT OF OTHER CASH/UNACCOUNTED TRANSACTION FOR RS.16,77,000/- BY TREATING IT AS UNEXPLAINED EXPENDITURE U/S.69C OF THE ACT. THE APPELLANT BEING AGGRIEVED, PRAYS THAT THE ADDIT ION MADE ON ACCOUNT OF UNEXPLAINED EXPENDITURE U/S. 69C TO THE EXTENT OF RS. 16,77,000/- BEING UNJUSTIFIED, UNWARRANTED, BAD IN LAW AND ILLEGAL BE DELETED. GROUND IV :- ITA NOS.3496 TO 3498, 4794 & 4795/MUM/15 A.YS. 03-0 4 TO 07-08 [LATE SUNIL D GULATI VS. CIT] PAGE 19 ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(A) HAS ERRED IN CONFIRMING THE ADDITION MADE ON ACCOUNT OF OTHER CASH/UNACCOUNTED TRANSACTION FOR RS.11,00,000/- BY TREATING IT AS UNEXPLAINED EXPENDITURE U/S.69C OF THE ACT. THE APPELLANT BEING AGGRIEVED, PRAYS THAT THE ADDIT ION MADE ON ACCOUNT OF UNEXPLAINED EXPENDITURE U/S. 69C TO THE EXTENT OF RS. 11,00,000/- BEING UNJUSTIFIED, UNWARRANTED, BAD IN LAW AND ILLEGAL BE DELETED. GROUND V :- ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(A) HAS ERRED IN CONFIRMING THE ADDITION MADE ON ACCOUNT OF CURRENT LIABILITIES AND UNSECURE D LOANS AS UNEXPLAINED CASH CREDIT FOR RS. 81,88,760/ - U/S. 68 OF THE ACT. THE APPELLANT BEING AGGRIEVED, PRAYS THAT THE ADDIT ION MADE ON ACCOUNT OF CURRENT LIABILITIES AND UNSECURE D LOANS AS UNEXPLAINED CASH CREDIT U/S. 68 TO THE EXT ENT OF RS. 81,88,760/- BEING UNJUSTIFIED, UNWARRANTED, BAD IN LAW AND ILLEGAL BE DELETED. GROUND VI :- ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(A) HAS ERRED IN MAKING ADDITION ON ACCOUNT OF ESTIMATING WITHDRAWALS AT RS. 7,20,000/- AND ADDED RS.92,443/- OVER AND ABOVE THE AMOUNT SHOWN IN CAPITAL ACCOUNT AT RS. 6,27,557/- ON ACCOU NT OF WITHDRAWALS. THE APPELLANT BEING AGGRIEVED, PRAYS THAT THE ADDIT ION MADE ON ACCOUNT OF DIFFERENCE IN ESTIMATED HIGHER WITHDRAWALS TO THE EXTENT OF RS. 92,443/- BEING UNJUSTIFIED, UNWARRANTED, BAD IN LAW AND ILLEGAL BE DELETED. GROUND VII :- ITA NOS.3496 TO 3498, 4794 & 4795/MUM/15 A.YS. 03-0 4 TO 07-08 [LATE SUNIL D GULATI VS. CIT] PAGE 20 ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(A) HAS ERRED IN CONFIRMING THE DISALLOWANCE OF RS.35,419/- MADE ON ACCOUNT OF PERSONAL ELEMENT IN CERTAIN EXPENSES. THE APPELLANT BEING AGGRIEVED PRAYS THAT THE ADDITI ON MADE ON ACCOUNT OF ESTIMATED PERSONAL ELEMENT IN CERTAIN EXPENSES TO THE EXTENT OF RS. 35,419/- BEIN G UNJUSTIFIED, UNWARRANTED, BAD IN LAW AND ILLEGAL BE DELETED. 16. FIRST ISSUE IS WITH REGARD TO PROTECTIVE ASSESS MENT OF RS.63,51,926/- OF ALL DEPOSITS OF AN ACCOUNT. DURI NG COURSE OF SEARCH, CERTAIN BANK ACCOUNTS VIZ. CURRENT ACCOUNT NO.029204301220192 WITH THE COSMOS CO-OP. BANK LTD. IN THE NAME OF M/S.SADGURU ARTS WERE NOT FOUND TO BE D ISCLOSED BY DECEASED ASSESSEE IN HIS REGULAR BOOKS OF ACCOUN T. ASSESSING OFFICER OBSERVED THAT DECEASED ASSESSEE W AS PROPRIETOR OF M/S. SADGURU ARTS. IN HIS STATEMENT O N OATH U/S.131 OF THE ACT RECORDED ON 19.02.2009 DURING TH E COURSE OF SURVEY AT HIS OFFICE PREMISES, DECEASED ASSESSEE HAD STATED THAT HE HAD MADE A FILM, NAMELY, 'DHAMKI' DURING F. Y. 2002- 03 IN HIS PROPRIETARY CONCERN M/S.SADGURU ARTS. DE CEASED ASSESSEE STATED AT RELEVANT POINT OF TIME THAT DURI NG LAST THREE YEARS, THERE WAS NO BUSINESS IN IT. DECEASED ASSES SEE WAS ASKED TO FURNISH DETAILS OF ALL THESE BANK ACCOUNTS FOUND DURING COURSE OF SEARCH AND EXPLANATION ABOUT NATUR E AND SOURCE OF DEPOSITS THEREIN ALONG WITH SUPPORTING DO CUMENTS. ASSESSING OFFICER OBSERVED THAT THE ABOVE BANK ACCO UNT WITH THE COSMOS CO-OP. BANK LTD. WAS OPERATIVE FROM F.Y. 2003-04 (A.Y.2004-05). IT WAS CLAIMED BY DECEASED ASSESSEE THAT M/S. SADGURU ARTS WAS A DEFUNCT ENTITY SINCE THE YEAR 20 03. ITA NOS.3496 TO 3498, 4794 & 4795/MUM/15 A.YS. 03-0 4 TO 07-08 [LATE SUNIL D GULATI VS. CIT] PAGE 21 HOWEVER, FROM PERUSAL OF ABOVE BANK ACCOUNT STATEME NTS, IT WAS FOUND THAT THERE WERE SUBSTANTIAL TRANSACTIONS IN THESE BANK ACCOUNTS. IN VIEW OF THESE FACTS, DECEASED ASS ESSEE WAS ASKED TO EXPLAIN THESE ISSUES. IN RESPONSE TO SAME , DECEASED ASSESSEE VIDE ITS LETTER DATED 19.12.2011 STATED TH AT THESE ACCOUNTS OF M/S. SADGURU ARTS AND CERTAIN CREDIT CA RD TRANSACTIONS WERE NOT REFLECTED IN HIS BALANCE SHEE T BECAUSE THE SAME RELATED TO HIS HUF AND WERE ACCOUNTED FOR IN THAT ENTITY. HOWEVER, CIT(A) ALSO REJECTED DECEASED ASS ESSEES CONTENTION. IT WAS FOUND THAT AS PER THE COPY OF B ANK STATEMENT RECEIVED FROM THE BANK, THERE WERE TOTAL DEPOSITS OF RS.63,51,926/- IN THE BANK ACCOUNT WITH THE COSMOS CO-OP. BANK LTD. IN F.Y.2004-05 RELEVANT TO THE ASSESSMENT YEAR UNDER CONSIDERATION OUT OF WHICH THERE WERE CASH DE POSITS OF RS.9,36,000/-. AS ASSESSEE FAILED TO FURNISH EXPLAN ATION AS REGARDS THE NATURE AND SOURCE OF SAID DEPOSITS IN B ANK ACCOUNT, THE AMOUNT OF RS.63,51,926/- WAS HELD AS UNACCOUNTED INCOME/UNDISCLOSED INCOME/ UNEXPLAINED MONEY OF THE APPELLANT AND ADDED TO THE TOTAL INCOME OF A SSESSEE BY ASSESSING OFFICER. AS STATED ABOVE, THE STAND OF A SSESSEE HAS BEEN THAT M/S. SADGURU ARTS WAS A PROPRIETARY CONCE RN OF LATE SUNIL D. GULATI (HUF) ENGAGED IN THE BUSINESS OF FI LM PRODUCTION. IT WAS STATED THAT FOR THIS REASON, THE AFORESAID BANK ACCOUNT WAS NOT REFLECTED IN THE ACCOUNTS OF A SSESSEE MAINTAINED BY HIM IN HIS INDIVIDUAL CAPACITY. IN T HIS REGARD, COPIES OF INCOME TAX RETURNS ALONG WITH COMPUTATION OF INCOME, BALANCE SHEET, P&L ACCOUNT OF LATE SUNIL D, GULATI (HUF) FOR A.Y.2004-05 WERE SUBMITTED INTER ALIA STA TED THAT AS ITA NOS.3496 TO 3498, 4794 & 4795/MUM/15 A.YS. 03-0 4 TO 07-08 [LATE SUNIL D GULATI VS. CIT] PAGE 22 THERE WAS NO SUBSTANTIAL FUNDS RELATED BUSINESS CAR RIED ON BY M/S. SADGURU ARTS IN THE SUBSEQUENT YEARS AND THERE WAS NO POSITIVE INCOME, THE RETURNS OF INCOME FOR THE HUF BUSINESS WERE NOT FILED IN THE A.YS. SUBSEQUENT TO A.Y.2004- 05. HOWEVER, IT WAS CLAIMED THAT THE SAID BANK ACCOUNT HAD BEEN DULY REFLECTED IN THE BOOKS OF LATE SUNIL D. GULATI (HUF) AND ACCOUNTED FOR IN THAT ENTITY. IN THE COURSE OF ASS ESSMENT, DECEASED ASSESSEE VIDE LETTER DATED 19.12.2011 CLAI MED THAT THE AFORESAID BANK ACCOUNT WAS NOT REFLECTED IN HIS BALANCE SHEET BECAUSE THE SAME RELATED TO DECEASED ASSESSEE S HUF. TO SUPPORT HIS CLAIM, ASSESSEE PLACED ON RECORD COPY O F INCOME TAX RETURN OF LATE SUNIL D. GULATI HUF (PAN: AAJHS5 553H) SHOWING TOTAL INCOME OF RS.6,11,326/- FOR A.Y.2004- 05. THE AFORESAID BANK ACCOUNT HELD WITH THE COSMOS CO-OP. BANK LTD. WAS INCORPORATED IN THE INCOME TAX RETURN OF THE DE CEASED ASSESSEE'S HUF. AS STATED ABOVE, NO RETURN OF LATE SUNIL D. GULATI (HUF) HAS BEEN FILED FOR THE YEAR UNDER CONS IDERATION. SINCE, THE SAID BANK ACCOUNT WAS CLAIMED TO BE PERT AINING TO DECEASED ASSESSEES HUF AND WAS DISCLOSED IN THE IN COME TAX RETURN OF THE SAID HUF FOR A.Y.2004-05, THE SUBSTAN TIVE ADDITION ON ACCOUNT OF UNEXPLAINED DEPOSITS OF RS.6 3,51,926/- THEREIN HAS TO BE MADE NOT IN THE HANDS OF DECEASED ASSESSEE BUT IN THE HANDS OF HIS HUF WHICH IS A SEPARATE TAX ABLE ENTITY UNDER THE ACT. MEANWHILE, THE KARTA OF HUF PASSED AWAY ON 07.01.2013 AND HE WAS SURVIVED BY HIS WIFE AND A MI NOR DAUGHTER AND SON. THUS, DECEASED ASSESSEES WIFE I S THE LEGAL HEIR EVEN OF LATE SUNIL D. GULATI (HUF). SO, SAME WAS TO BE ASSESSED IN HUF. THERE WAS NO CLARITY WITH REGARD TO PARTITION ITA NOS.3496 TO 3498, 4794 & 4795/MUM/15 A.YS. 03-0 4 TO 07-08 [LATE SUNIL D GULATI VS. CIT] PAGE 23 OF HUF, SO, ASSESSING OFFICER WAS DIRECTED TO INTIM ATE HIS COUNTERPART HAVING JURISDICTION OVER THE CASE OF LA TE SUNIL D. GULATI (HUF) TO INITIATE NECESSARY ACTION FOR ASSES SING THE SAID AMOUNT OF UNEXPLAINED BANK DEPOSITS OF RS.63,51,926 /- IN THE HANDS OF SAID HUF BY RESORTING TO THE PROVISIONS OF SECTION 148 R.W.S. 150 OF THE ACT. THEREFORE, THE SUBSTANTIVE ADDITION ON ACCOUNT OF UNEXPLAINED BANK DEPOSITS OF RS.63,51,92 6/- MADE BY ASSESSING OFFICER IN THE HANDS OF DECEASED ASSES SEE WAS DELETED. HOWEVER, IN ORDER TO SAFEGUARD THE INTERE ST OF THE REVENUE, IT WAS HELD THAT PROTECTIVE ADDITION OF RS .63,51,926/- TOWARDS UNEXPLAINED DEPOSITS IN AFORESAID BANK ACCO UNT WILL CONTINUE IN THE HANDS OF ASSESSEE TILL THE SAID AMO UNT IS FINALLY ASSESSED IN THE HANDS OF ASSESSEES HUF. ONCE CIT( A) HELD THAT THE AMOUNT BELONGS TO BANK ACCOUNT DEPOSIT OF RS.63,51,926/- SHOULD BE ASSESSED IN THE HANDS OF L ATE SUNIL D. GULATI (HUF), SO, PROTECTIVE ADDITION IN CASE OF DECEASED ASSESSEE IS NOT JUSTIFIED AND SAME IS DIRECTED TO B E DELETED. 17. NEXT ISSUE IS WITH REGARD TO ADDITION ON ACCOUN T OF DEAL WISE EXCEL SHEETS FOR A SUM OF RS.1,71,000/- AS UNE XPLAINED EXPENDITURE U/S.69C OF THE ACT. IN HIS ANSWER TO Q . N0.4 IN HIS STATEMENT RECORDED U/S.132(4) OF THE ACT IN THE COURSE OF SEARCH AT HIS OFFICE ON 19.02.2009, DECEASED ASSESS EE HAD CATEGORICALLY STATED THAT WHILE DEALING IN 12.5% CI DCO PLOTS, THE CONSIDERATION PAID TO THE FARMERS/INVESTORS WAS BOTH IN CASH AND BY CHEQUES. DURING COURSE OF SEARCH, A NU MBER OF COMPUTER GENERATED SHEETS WERE FOUND AT THE BUSINES S PREMISES OF DECEASED ASSESSEE CONTAINING VARIOUS DE TAILS IN ITA NOS.3496 TO 3498, 4794 & 4795/MUM/15 A.YS. 03-0 4 TO 07-08 [LATE SUNIL D GULATI VS. CIT] PAGE 24 RESPECT OF EACH PARTICULAR LAND DEAL. THESE SHEETS HEREINAFTER HAVE BEEN TERMED AS 'DEAL WISE EXCEL SHEET' (OWES). EACH SHEET CORRESPONDED TO A PARTICULAR DEAL AND SHOWED THE STATUS OF PAYMENTS MADE BY CHEQUE AS WELL AS IN CASH AS ON A PARTICULAR DATE. THE AMOUNTS OF ON-MONEY PAID WERE FOUND TO BE NOT REFLECTED IN THE BOOKS OF ACCOUNT OF DECEASE D ASSESSEE. DURING THE COURSE OF POST-SEARCH PROCEEDINGS, ASSES SEE SUBMITTED FUND FLOW/CASH STATEMENTS COVERING FIVE F .YS. FROM 2004-05 TO 2008-09. THESE STATEMENTS SHOWED PERSON AL CASH DEALS IN HIS BUSINESS. A PRELIMINARY ANALYSIS OF TH ESE TWO STATEMENTS REVEALED THAT THEY HAD SEVERAL DEFECTS/ SHORTCOMINGS AS OUTLINED IN PARAS 33 TO 3.3.4 ON PA GE 3-4 OF THE IMPUGNED ORDER FOR WHICH NO CLARIFICATION WAS G IVEN AT THE TIME OF ASSESSMENT. IT WAS CONCLUDED THAT THESE STA TEMENTS DID NOT REFLECT THE TRUE AND CORRECT PICTURE OF THE BUS INESS AND PERSONAL TRANSACTIONS OF THE APPELLANT AND AS SUCH COULD NOT BE RELIED UPON. DURING COURSE OF ASSESSMENT PROCEED INGS, DECEASED ASSESSEE WAS ASKED TO FURNISH COMPLETE DETAILS/EXPLANATION IN RESPECT OF ALL SUCH DWES ALO NG WITH SUPPORTING DOCUMENTS AND EVIDENCES. SIMILAR ISSUE AROSE IN A.Y. 2003-04 WHEREIN VIDE PARA 3 OF THIS ORDER WHER EIN WE HAVE DELETED SIMILAR ADDITION. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, THE ADDITION IN QUESTION IS DIRECTED TO BE DELETED. 18. NEXT ISSUE IS WITH REGARD TO ADDITION ON ACCOUN T OF OTHER CASH / UNACCOUNTED TRANSACTION OF RS.16,77,000/- BY TREATING IT AS UNEXPLAINED EXPENDITURE U/S.69C OF THE ACT. ASSESSING OFFICER MADE ADDITION OF RS.16,77,000/- ON THE BASI S OF ITA NOS.3496 TO 3498, 4794 & 4795/MUM/15 A.YS. 03-0 4 TO 07-08 [LATE SUNIL D GULATI VS. CIT] PAGE 25 RECEIPTS ISSUED BY DECEASED ASSESSEE TREATING ALL O F THEM AS IN CASH AND UNACCOUNTED ONE. DURING COURSE OF SEARCH, A NUMBER OF CASH RECEIPTS CONTAINING DETAILS OF CASH PAYMENT S MADE BY DECEASED ASSESSEE AGGREGATING TO RS.L.11 CRORES IN RESPECT OF VARIOUS LAND DEALS HAVE BEEN SEIZED/IMPOUNDED AS TA BULATED IN PARA 8.1 ON PAGE 17 OF THE IMPUGNED ORDER. DURI NG COURSE OF ASSESSMENT PROCEEDINGS, ASSESSING OFFICER IN RES PECT OF ALL RECEIPTS MENTIONED IN PARA 8.1 ON PAGE 17 ASKED DEC EASED ASSESSEE TO FURNISH COMPLETE DETAILS/EXPLANATION AL ONG WITH SUPPORTING DOCUMENTS AND EVIDENCES VIDE SHOW-CAUSE NOTICE DATED 15.10.2010. SINCE, DECEASED ASSESSEE COULD N OT GIVE SATISFACTORY EXPLANATION IN THIS REGARD, SO, ASSESS ING OFFICER HELD THAT UNEXPLAINED EXPENDITURE OF RS.16,77,000/- WOULD NOT BE ALLOWED AS A DEDUCTION UNDER ANY HEAD OF INC OME AS PER PROVISO TO SECTION 69C OF THE ACT. IN APPEAL, SAME WAS CONFIRMED. 18.1 AS WE HAVE DISCUSSED SIMILAR MATTER IN A.Y. 20 03-04, WHEREIN STAND OF ASSESSEE HAS BEEN THAT DECEASED AS SESSEE IS ONLY A REAL ESTATE AGENT OR BROKER OR DEAL MAKER AN D HENCE HE USED TO BLOCK THE PLOTS BY GIVING SOME ADVANCES TO THE PLOT OWNERS-CUM-FARMERS FOR WHICH THEY WOULD ISSUE THE R ECEIPTS AND FOR THE SAKE OF EFFECTIVE CONTROL AND MONITORIN G, DECEASED ASSESSEE WAS KEEPING WITH HIM ALL THE RECEIPTS EITH ER PAID BY HIM DIRECTLY OR PAID BY THE INTENDING BUYERS. OUT O F THESE RECEIPTS, IT WAS STATED THAT ONE RECEIPT OF RS.77,0 00/- HAS BEEN RECORDED IN THE BOOKS OF ACCOUNTS TO THE EXTENT ACT UALLY PAID BY DECEASED ASSESSEE. AS REGARDS OTHER RECEIPTS OF ITA NOS.3496 TO 3498, 4794 & 4795/MUM/15 A.YS. 03-0 4 TO 07-08 [LATE SUNIL D GULATI VS. CIT] PAGE 26 RS.16,00,000/-, IT WAS CLAIMED THAT RECEIPTS OF RS. 8,00,000/- EACH FROM NAYEEM ABDUL PATEL AND ARIF IBRAHIM PATEL WERE FICTITIOUS AND NOT ACTUAL. IT WAS CONTENDED THAT EV EN NAME OF THE PERSONS WAS BOGUS AND RECEIPTS WERE EXAGGERATED AND THAT THERE WAS NO TRANSACTION OF 3100 SQ. MTRS. PLOT AT OWE. IT WAS STAND OF ASSESSEE THAT WHILE CARRYING ON HIS BUSINE SS, ASSESSEE SOMETIMES USED TO CREATE SOME NON-GENUINE RECEIPTS FROM THE FARMERS-CUM-PLOT OWNERS AS IF DECEASED ASSESSEE HAD MADE PAYMENTS TO THEM OR RECEIVED MONEY FROM THEM AND IT WAS ARGUED THAT THESE RECEIPTS DID NOT REPRESENT REAL T RANSACTIONS AT ALL. IT WAS SUBMITTED THAT ASSESSEE IS BOUND TO FOLLOW THIS PRACTICE, HOWEVER UNDESIRABLE IT MAY APPEAR TO BE, IN THE CUT- THROAT COMPETITIVE REAL ESTATE MARKET SO THAT HE CA N PROJECT TO THE INTENDING BUYERS/DEVELOPERS/BUILDERS OF THE PLO TS AS THOUGH DECEASED ASSESSEE IS HAVING NUMEROUS PLOTS F OR SALE ON HAND. IT WAS ALSO STAND OF ASSESSEE THAT NO PAPERS OR DOCUMENTS SEIZED FROM DECEASED ASSESSEES PREMISES HAVE ANY CORRELATION WITH THESE RECEIPTS. IT WAS ALSO POINT ED OUT THAT ASSESSING OFFICER ALSO HAD NOT LINKED THESE RECEIPT S WITH NECESSARY MATERIAL EVIDENCES WITH THE PLOTS ACTUALL Y TRANSACTED BY THE DECEASED ASSESSEE I.E. PURCHASED OR SOLD THR OUGH HIM. IN VIEW OF THIS, REVENUE AUTHORITIES HAVE TO BRING CONCURRENT EVIDENCE WITH REGARD TO THE SAID EXPLANATION VIS-- VIS PLOT. DECEASED ASSESSEE WAS NOT AN INVESTOR. HE WAS DOIN G INVESTMENT ON BEHALF OF OTHER PARTIES. HE MIGHT HA VE DONE SOMETHING WRONG FOR INCREASING BROKERAGE BUSINESS. AFTER SEARCH, REVENUE AUTHORITIES HAD OPTION TO UNEARTH T RANSACTION CORRESPONDENCE TO THE EXPENDITURE IN QUESTION WHICH HAS NOT ITA NOS.3496 TO 3498, 4794 & 4795/MUM/15 A.YS. 03-0 4 TO 07-08 [LATE SUNIL D GULATI VS. CIT] PAGE 27 BEEN DONE, MEANING THEREBY, REVENUE AUTHORITIES HAV E NOT FOUND THIS DOCUMENT IN COURSE OF SEARCH. SO, SUCH TRANSACTIONS DONE FOR THE SAKE OF BUSINESS CANNOT B E MADE SOUND BASIS FOR ADDITION IN QUESTION. IN VIEW OF A BOVE DISCUSSION, ADDITION IS NOT JUSTIFIED. SAME IS DIR ECTED TO BE DELETED. 19. NEXT ISSUE IS WITH REGARD TO ADDITION OF RS.11 LACS MADE ON ACCOUNT OF OTHER CASH/UNACCOUNTED TRANSACTION BY TREATING SAME AS UNEXPLAINED EXPENDITURE. ASSESSING OFFICER OBSERVED THAT PAGE NO.14 OF ANNEXURE A-L IMPOUNDED FROM AREN JA OFFICE OF DECEASED ASSESSEE SHOWED DATE-WISE DETAILS OF PA YMENTS MADE BETWEEN 15.02.2004 TO 12.09.2007 IN CASH AND C HEQUES TO VARIOUS FARMERS/BROKERS IN RESPECT OF VARIOUS PR OPERTIES /PLOTS. DECEASED ASSESSEE WAS ASKED TO FURNISH SOU RCE OF THESE PAYMENTS ALONG WITH SUPPORTING DOCUMENTS AND OTHER RELEVANT DETAILS. BUT DECEASED ASSESSEE FAILED TO G IVE REASONABLE EXPLANATION IN THIS REGARD. ASSESSING OF FICER OBSERVED THAT THESE PAYMENTS WERE NEITHER REFLECTED IN THE BOOKS OF ACCOUNT NOR INCLUDED IN THE FUND/CASH FLOW STATEMENTS SUBMITTED BY DECEASED ASSESSEE DURING TH E POST- SEARCH PROCEEDINGS. HE ALSO NOTED FROM THE DATE-WI SE ENTRIES OF VARIOUS PAYMENTS THAT UNACCOUNTED CASH PAYMENTS OF RS.11,00,000/- PERTAINED TO A.Y.2005-06. IN VIEW OF ABOVE, UNACCOUNTED CASH PAYMENTS AMOUNTING TO RS.11,00,000 /- AND PERTAINING TO A.Y.2005-06 WERE HELD AS UNEXPLAINED EXPENDITURE U/S.69C OF THE ACT AND ADDED TO THE TOT AL INCOME OF DECEASED ASSESSEE. IT WAS ALSO HELD THAT THE SAI D ITA NOS.3496 TO 3498, 4794 & 4795/MUM/15 A.YS. 03-0 4 TO 07-08 [LATE SUNIL D GULATI VS. CIT] PAGE 28 UNEXPLAINED EXPENDITURE OF RS.11,00,000/- WOULD NOT BE ALLOWED AS A DEDUCTION AS PER PROVISO TO SECTION 69 C OF THE ACT UNDER ANY HEAD OF INCOME. 19.1 MATTER WAS CARRIED BEFORE THE CIT(A), WHEREIN VARIOUS CONTENTIONS WERE RAISED ON BEHALF OF ASSESSEE AND H AVING CONSIDERED THE SAME CIT(A) CONFIRMED THE ORDER OF A SSESSING OFFICER. 19.2 STAND OF ASSESSEE HAS BEEN THAT DECEASED ASSES SEE NEITHER PAID ANY CASH OR CHEQUE FOR THE PURCHASE OF ANY PLOTS IN HIS NAME NOR DID HE RECEIVE ANY CASH OR CHEQUE F OR THE SALE OF ANY PLOTS IN HIS NAME. IT WAS STAND OF DECEASED ASSESSEE THAT DECEASED ASSESSEE HAD NOT BOUGHT ANY PLOT OF L AND FOR HIS OWN PURPOSE. IN ALL THE DEALINGS HE MADE IN THE AB OVE SAID CIDCO 12.5% PLOT SCHEME HE WAS ACTING AS AGENT ONLY . SO, THESE PAYMENTS WERE NOT THE PAYMENTS OF DECEASED AS SESSEE. IT WAS CATEGORICALLY CLAIMED THAT WHENEVER DECEASED ASSESSEE RECEIVED PAYMENTS IN CASH OR CHEQUE WHICH WERE PAYA BLE TO THE LAND OWNERS, THOSE HAD BEEN SHOWN AS RECEIPTS AND W HENEVER THESE WERE TO BE DISBURSED TO THE FARMERS, THESE WE RE SHOWN AS PAYMENTS. BOTH THESE RECEIPTS AND PAYMENTS WERE NO T PART OF TRANSACTION OF DECEASED ASSESSEE BUT PAYMENTS ROUTE D THROUGH HIM AS AGENT. IT IS CLAIMED THAT HE KEPT SIMPLY THE RECORD OF THE RECEIPTS AND PAYMENTS OF THOSE TRANSACTIONS FOR HIS DAY-TO-DAY BUSINESS ACTIVITIES FOR ENSURING THE PROMPT AND ACT UAL PAYMENTS MADE BY THE INVESTOR TO THE LAND OWNERS AS PER TERMS AND CONDITIONS AND PRICE NEGOTIATED BY PARTIE S. IN FACT, ASSESSEE WAS SIMPLY BROKER IN ALL THESE DETAILS. T HERE IS ITA NOS.3496 TO 3498, 4794 & 4795/MUM/15 A.YS. 03-0 4 TO 07-08 [LATE SUNIL D GULATI VS. CIT] PAGE 29 NOTHING ON RECORD TO SUGGEST THAT ASSESSEE HAS MADE THESE TRANSACTIONS IN HIS NAME. SO, THESE RECORDS WERE N OT PART OF BOOKS OF ACCOUNTS OF DECEASED ASSESSEE AND THAT HE WAS ONLY THE RECORD KEEPER OF THESE TRANSACTIONS AS A PROPER TY BROKER. THEREFORE, IN NAME OF ASSESSEE, NO INCOME COULD BE DETERMINED ON THE BASIS OF THESE EXTRANEOUS RECORDS. ASSESSING OFFICER MADE ADDITION OF RS.11,00,000/-ON THE BASIS OF TRAN SACTIONS RECORDED ON PAGE 14 OF ANNEXURE A-L CONTAINING THE DETAILS OF THE AMOUNTS PAID IN CASH TO SUMEET BACCHEWAR AND RA KESH SURVE DURING F.Y. 2004-05. AS STATED ABOVE, REVENU E HAS NOT BROUGHT ANYTHING ON RECORD OF ACTUAL TRANSACTION DO NE BY DECEASED ASSESSEE HIMSELF. AS DECEASED ASSESSEES CONSISTENT STAND HAS BEEN ACCEPTED BY US THAT HE WAS ONLY A RE AL ESTATE AGENT OR BROKER OR DEAL MAKER AND HENCE HE USED TO BLOCK THE PLOTS BY GIVING SOME ADVANCES TO THE PLOT OWNERS-CU M-FARMERS ON BEHALF OF INVESTORS ONLY. REVENUE AUTHORITIES H AD NOT BROUGHT ANYTHING ON RECORD TO SUGGEST THAT ASSESSEE HIMSELF PURCHASED PROPERTY IN QUESTION FROM THE FARMERS. I N SUCH A SITUATION, ASSESSEE WAS ENTITLED FOR BROKERAGE ONLY . IN VIEW OF ABOVE, ADDITION IN QUESTION IS NOT JUSTIFIED. SAME IS DIRECTED TO BE DELETED. 20. NEXT ISSUE IS WITH REGARD TO ADDITION TO THE EX TENT OF RS.81,88,760/-. ASSESSING OFFICER MADE ADDITION OF UNEXPLAINED CASH CREDIT OF RS.2,00,95,760/- TREATIN G ALL CURRENT LIABILITIES AND UNSECURED LOAN AS CASH CRED IT. IT CONSISTS OF UNSECURED LOAN OF RS.72,28,760/- AND CU RRENT ITA NOS.3496 TO 3498, 4794 & 4795/MUM/15 A.YS. 03-0 4 TO 07-08 [LATE SUNIL D GULATI VS. CIT] PAGE 30 LIABILITIES OF RS.1,28,67,000/- AGAINST VARIOUS PAR TIES/ NARRATIONS. 20.1 MATTER WAS CARRIED BEFORE THE FIRST APPELLATE AUTHORITY, WHEREIN OUT OF RS.72,28,760/-, ADDITION TO THE EXTE NT OF RS. 44,21,760/- AND OUT OF RS.1,28,67,000/-, ADDITION T O THE EXTENT OF RS.37,67,000/- SUSTAINED BY CIT(A) WHICH COMES TO RS.81,88,760/-. REVENUE IS NOT IN APPEAL AGAINST T HIS RELIEF GRANTED TO ASSESSEE. 20.2 WITH REGARD TO UNSECURED LOAN OF RS.72,28,760/ -, THE ASSESSEE HAS FURNISHED THE CONFIRMATION LETTER FROM 9 PARTIES WHO HAD GIVEN UNSECURED LOANS OF RS.41,59,610/- TO ASSESSEE. AS REGARDS SUM OF RS.22,50,000/- SHOWN IN THE NAME OF RADHIKA FLAT (SHAZIYA DHANANI), IT WAS SUBMITTED TH AT THIS WAS PART OF SALE PROCEEDS OF ASSESSEE'S SELF OCCUPIED P ROPERTY, NAMELY, RADHIKA FLAT IN VASHI RECEIVED FROM SHAZIYA DHANANI THROUGH PAY ORDERS. IT WAS SUBMITTED THAT THESE PAY ORDERS WERE ENCASHED THROUGH ASSESSEES ACCOUNT IN THE COS MOS CO- OP. BANK LTD AND THESE WERE DULY REFLECTED IN THE B ALANCE SHEET OF ASSESSEE. IT WAS STATED THAT IN THE SAME YEAR, A SSESSEE HAD PURCHASED A RESIDENTIAL FLAT AT BANDRA FOR RS.48,03 ,730/- FOR WHICH ENTIRE SALE PROCEEDS OF RADHIKA FLAT WERE UTI LIZED. IT WAS CLAIMED THAT DECEASED ASSESSEE WAS ENTITLED TO EXEM PTION U/S.54 OF THE ACT AND HENCE NO TAX WAS ATTRACTED ON THE SAME. REVENUE AUTHORITIES HAVE NOT REBUTTED THE SAME BY C OGENT REASONING. WITH REGARD TO UNSECURED LOAN OF RS.5,1 9,150/- FROM SANDEEP RANGRAS, IT WAS SUBMITTED THAT ADDITIO N OF OPENING BALANCE OF RS.2,00,000/- WAS ALREADY MADE I N ITA NOS.3496 TO 3498, 4794 & 4795/MUM/15 A.YS. 03-0 4 TO 07-08 [LATE SUNIL D GULATI VS. CIT] PAGE 31 A.Y.2004-05 AND RS.3,19,L50/- WAS ACCEPTED DURING T HE YEAR. AS REGARDS UNSECURED LOANS OF RS.1,19,000/- FROM SA TYAM ESTATE CONSULTANT (RAJESH GULATI), IT WAS SUBMITTED THAT ASSESSING OFFICER HAD MADE ADDITION OF RS.6,69,000/ - IN A.Y.2004-05 ITSELF. IT WAS STATED THAT DECEASED AS SESSEE MADE REPAYMENT OF RS.5,50,000/- DURING FINANCIAL YEAR RE LEVANT TO ASSESSMENT YEAR UNDER APPEAL. THIS HAS RESULTED IN REDUCED CLOSING BALANCE OF RS.1,19,000/- WHICH THE ASSESSIN G OFFICER AGAIN ADDED INADVERTENTLY AS A NEW DEPOSIT. WITHOU T PREJUDICE TO THE ABOVE, THERE WERE NO FRESH RECEIPTS OF LOAN FROM THE ABOVE PARTY DURING THE PERIOD. THE LOAN TAKEN FROM SATYAM ESTATE CONSULTANT WAS GENUINE AS PER THE CONFIRMATI ON LETTER FILED IN A.Y.2004-05. IN RESPECT OF UNSECURED LOAN OF RS.4,38,000/- FROM SHUBHAM ESTATE CONSULTANT (PRADE EP GULATI), THE ASSESSING OFFICER MADE ADDITION OF RS. 4,60,000/- IN A.Y.2004-05 ITSELF. IT WAS STATED THAT DECEASED ASSESSEE HAD MADE REPAYMENT OF RS.22,000/-DURING THE FINANCIAL Y EAR RELEVANT TO THE ASSESSMENT YEAR UNDER APPEAL. THIS HAS RESULTED IN REDUCED CLOSING BALANCE OF RS.4,38,000/ - WHICH ASSESSING OFFICER AGAIN ADDED INADVERTENTLY AS A NE W DEPOSIT. IT WAS CLAIMED THAT THERE WERE NO FRESH RECEIPTS OF LO AN FROM THE ABOVE PARTY DURING THE PERIOD. IN VIEW OF ABOVE FAC TS ON RECORD, THE ADDITION IN QUESTION IS NOT JUSTIFIED. SAME CA NNOT BE SUSTAINED. WITHOUT PREJUDICE TO THE ABOVE, IT WAS STAND OF ASSESSEE THAT LOAN TAKEN FROM SHUBHAM ESTATE CONSUL TANT WAS GENUINE AS PER THE CONFIRMATION LETTER FILED IN EARLIER YEARS AS WELL AS IN THE ASSESSMENT YEAR UNDER CONSIDERATI ON. TAKING ITA NOS.3496 TO 3498, 4794 & 4795/MUM/15 A.YS. 03-0 4 TO 07-08 [LATE SUNIL D GULATI VS. CIT] PAGE 32 ALL THESE FACTS AND CIRCUMSTANCES INTO CONSIDERATIO N, ADDITIONS IN QUESTION ARE NOT JUSTIFIED. SAME ARE DIRECTED T O BE DELETED. 21. NEXT GROUND IS WITH REGARD TO ADDITION OF RS.4, 72,443/- ON ACCOUNT OF DIFFERENCE IN ESTIMATED HIGHER WITHDRAWA LS OF RS.11,00,000/- THAN SHOWN IN CAPITAL ACCOUNT AT RS.6,27,557/-. DURING COURSE OF ASSESSMENT PROCEED INGS, ASSESSING OFFICER OBSERVED THAT AS PER DECEASED ASS ESSEES CAPITAL ACCOUNT, AN AMOUNT OF RS.6,27,557/- WAS DEB ITED ON ACCOUNT OF HOUSEHOLD EXPENSES AND HE HAD CLAIMED TH AT IT WAS MORE THAN SUFFICIENT. IN THIS REGARD, QUERIES WERE MADE FROM ASSESSEE AND LIVING STANDARD OF ASSESSEES HOUSEHOL D WITHDRAWAL WAS FOUND SUFFICIENT. SO, ASSESSING OFF ICER ADDED RS.4,72,443/- WHICH HAS BEEN RESTRICTED TO RS.92,44 3/- BY CIT(A). THERE IS NOTHING ON RECORD TO SUGGEST THAT THIS ADDITION ON THE BASIS OF HOUSEHOLD EXPENSES HAS BEEN MADE ON THE BASIS OF SEIZED MATERIAL FOUND DURING COURSE OF SEA RCH. SO, SUCH ADDITION IN ABSENCE OF ANY MATERIAL WAS NOT JU STIFIED. SAME IS DIRECTED TO BE DELETED. 22. NEXT ISSUE IS WITH REGARD TO DISALLOWANCE OF RS .35,419/- MADE ON ACCOUNT OF PERSONAL ELEMENT IN CERTAIN EXPE NSES. ADDITION ON ACCOUNT OF PERSONAL ELEMENT IN CERTAIN EXPENSES IS NOT JUSTIFIED. THE STAND OF DECEASED ASSESSEE HAS BEEN THAT THIS ADDITION IS ON THE BASIS OF PURELY ON ESTIMATI ON AND HAVING NO NEXUS WITH THE SEIZED MATERIALS FOUND AT THE TIM E OF SEARCH. SO, ADDITION IN QUESTION IS NOT JUSTIFIED. SAME IS DIRECTED TO BE DELETED. ITA NOS.3496 TO 3498, 4794 & 4795/MUM/15 A.YS. 03-0 4 TO 07-08 [LATE SUNIL D GULATI VS. CIT] PAGE 33 23. AS A RESULT, THIS APPEAL OF ASSESSEE IS ALLOWED . 24. IN ITA NO.4795/MUM/2015 FOR A.Y.2006-07, DECEAS ED ASSESSEE HAS FILED THE APPEAL ON THE FOLLOWING GROU NDS: GROUND I :- ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LEARNED COMMISSIONER OF INCOME TAX (APPEAL) - 54, MUMBAI ('HEREINAFTER REFERRED TO AS 'THE CIT(A)') H AS ERRED IN MAKING PROTECTIVE ASSESSMENT OF RS.1,56,33,474/-. THE APPELLANT BEING AGGRIEVED, PRAYS THAT THE ADDIT ION MADE ON ACCOUNT OF UNACCOUNTED BANK ACCOUNTS TO THE EXTENT OF RS. 1,56,33,474/- BEING UNJUSTIFIED, UNWARRANTED, BAD IN LAW AND ILLEGAL BE DELETED. GROUND II :- ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LEARNED COMMISSIONER OF INCOME TAX (APPEAL) - 54, MUMBAI ('HEREINAFTER REFERRED TO AS 'THE CIT(A)') H AS ERRED IN CONFIRMING AN ADDITION OF RS.45,13,442/- A S UNEXPLAINED DEPOSITS U/S.68 IN RESPECT OF THE TWO SAVINGS BANK ACCOUNT ALLEGED AS UNDISCLOSED IN THE BALANCE SHEET/BOOKS OF ACCOUNTS. THE APPELLANT BEING AGGRIEVED, PRAYS THAT THE ADDIT ION MADE ON ACCOUNT OF UNEXPLAINED DEPOSITS/ UNACCOUNTED BANK ACCOUNTS TO THE EXTENT OF RS.45,13,442/- BEING UNJUSTIFIED, UNWARRANTED, BAD IN LAW AND ILLEGAL BE DELETED. GROUND III :- ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LEARNED COMMISSIONER OF INCOME TAX (APPEAL) - 54, MUMBAI ('HEREINAFTER REFERRED TO AS 'THE CIT(A)') H AS ERRED IN UPHOLDING THE ADDITION MADE ON ACCOUNT OF DEAL WISE EXCEL SHEET FOR A SUM OF RS.1,47,000/- AS UNEXPLAINED EXPENDITURE U/S.69C OF THE ACT. ITA NOS.3496 TO 3498, 4794 & 4795/MUM/15 A.YS. 03-0 4 TO 07-08 [LATE SUNIL D GULATI VS. CIT] PAGE 34 THE APPELLANT BEING AGGRIEVED, PRAYS THAT THE ADDIT ION MADE ON ACCOUNT OF UNEXPLAINED EXPENDITURE TO THE EXTENT OF RS. 1,47,000/- BEING UNJUSTIFIED, UNWARRANTED, BAD IN LAW AND ILLEGAL BE DELETED. GROUND IV :- ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(A) HAS ERRED IN CONFIRMING THE ADDITION MADE ON ACCOUNT OF OTHER CASH/UNACCOUNTED TRANSACTION FOR RS.43,14,000/- BY TREATING IT AS UNEXPLAINED EXPENDITURE U/S.69C OF THE ACT. THE APPELLANT BEING AGGRIEVED, PRAYS THAT THE ADDIT ION MADE ON ACCOUNT OF UNEXPLAINED EXPENDITURE U/S. 69C TO THE EXTENT OF RS. 43,14,000/- BEING UNJUSTIFIED, UNWARRANTED, BAD IN LAW AND ILLEGAL BE DELETED. GROUND V :- ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(A) HAS ERRED IN CONFIRMING THE ADDITION MADE ON ACCOUNT OF OTHER CASH/UNACCOUNTED TRANSACTION FOR RS.4,00,000/- BY TREATING IT AS UNEXPLAINED EXPENDITURE U/S.69C OF THE ACT. THE APPELLANT BEING AGGRIEVED, PRAYS THAT THE ADDIT ION MADE ON ACCOUNT OF UNEXPLAINED EXPENDITURE U/S. 69C TO THE EXTENT OF RS. 4,00,000/- BEING UNJUSTIFIED, UNWARRANTED, BAD IN LAW AND ILLEGAL BE DELETED. GROUND VI :- ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(A) HAS ERRED IN CONFIRMING THE ADDITION MADE ON ACCOUNT OF CURRENT LIABILITIES AND UNSECURE D LOANS AS UNEXPLAINED CASH CREDIT FOR RS. 43,32,400/ - U/S. 68 OF THE ACT. THE APPELLANT BEING AGGRIEVED, PRAYS THAT THE ADDIT ION MADE ON ACCOUNT OF CURRENT LIABILITIES AND UNSECURE D LOANS AS UNEXPLAINED CASH CREDIT U/S. 68 TO THE EXT ENT ITA NOS.3496 TO 3498, 4794 & 4795/MUM/15 A.YS. 03-0 4 TO 07-08 [LATE SUNIL D GULATI VS. CIT] PAGE 35 OF RS. 43,32,400/- BEING UNJUSTIFIED, UNWARRANTED, BAD IN LAW AND ILLEGAL BE DELETED. GROUND VII :- ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(A) HAS ERRED IN CONFIRMING THE ADDITION MADE ON ACCOUNT OF DIFFERENCE IN ESTIMATED HIGHER WITHDRAWALS OF RS.2,08,829/- THAN SHOWN IN CAPITAL ACCOUNT AT RS.5,71,171/- ON ACCOUNT OF WITHDRAWALS. THE APPELLANT BEING AGGRIEVED, PRAYS THAT THE ADDIT ION MADE ON ACCOUNT OF DIFFERENCE IN ESTIMATED HIGHER WITHDRAWALS TO THE EXTENT OF RS. 2,08,829/- BEING UNJUSTIFIED, UNWARRANTED, BAD IN LAW AND ILLEGAL BE DELETED. GROUND VIII :- ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(A) HAS ERRED IN CONFIRMING THE DISALLOWANCE OF RS.53,398/- MADE ON ACCOUNT OF PERSONAL ELEMENT IN CERTAIN EXPENSES. THE APPELLANT BEING AGGRIEVED PRAYS THAT THE DISALLOWANCE MADE ON ACCOUNT OF ESTIMATED PERSONAL ELEMENT IN CERTAIN EXPENSES TO THE EXTENT OF RS. 53,398/- BEING UNJUSTIFIED, UNWARRANTED, BAD IN LAW AND ILLEGAL BE DELETED. GROUND IX :- ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(A) HAS ERRED IN CONFIRMING THE ADDITION MADE ON ACCOUNT OF DISALLOWANCE OF INTEREST U/S.36(1)(III) TO THE EXTENT OF RS.1,75,262/- ALLEG ING IT BEING NOT FOR THE BUSINESS PURPOSE. THE APPELLANT BEING AGGRIEVED, PRAYS THAT THE ADDIT ION MADE ON ACCOUNT OF DISALLOWANCE OF INTEREST U/S.36(1)(III) TO THE EXTENT OF RS.1,75,262/- BEING UNJUSTIFIED, UNWARRANTED, BAD IN LAW AND ILLEGAL BE DELETED. ITA NOS.3496 TO 3498, 4794 & 4795/MUM/15 A.YS. 03-0 4 TO 07-08 [LATE SUNIL D GULATI VS. CIT] PAGE 36 25. FIRST ISSUE IS WITH REGARD TO PROTECTIVE ASSESS MENT OF RS.1,56,33,474/-. DURING COURSE OF SEARCH, CERTAIN BANK ACCOUNTS VIZ. CURRENT ACCOUNT NO.117150050800335 & 029204301220192 WITH TAMILNADU MERCANTILE BANK LIMI TED AND THE COSMOS CO-OP. BANK LTD., RESPECTIVELY, IN T HE NAME OF M/S. SADGURU ARTS WERE NOT FOUND TO BE DISCLOSED BY DECEASED ASSESSEE IN HIS REGULAR BOOKS OF ACCOUNT. IT WAS O BSERVED BY ASSESSING OFFICER THAT DECEASED ASSESSEE WAS A PROP RIETOR OF M/S. SADGURU ARTS. FURTHER, DECEASED ASSESSEE WAS H AVING TWO BANK ACCOUNTS WITH TAMILNADU MERCANTILE BANK LIMITE D, VIZ., CURRENT ACCOUNT NO.117150050800336 AND ACCOUNT NO.117700480100052 WHICH WERE OPERATIVE SINCE F.Y.2 005-06 RELEVANT TO A.Y.2006-07. IN HIS STATEMENT ON OATH U /S.131 OF THE ACT RECORDED ON 19.02.2009 DURING COURSE OF SUR VEY AT HIS OFFICE PREMISES, DECEASED ASSESSEE HAD STATED THAT HE HAD MADE A FILM, NAMELY, 'DHAMKI' DURING F.Y. 2002-03 I N HIS PROPRIETARY CONCERN M/S. SADGURU ARTS. DECEASED AS SESSEE HAD ALSO STATED THAT DURING LAST THREE YEARS, THERE WAS NO BUSINESS IN IT. THE DECEASED ASSESSEE VIDE NOTICE U /S.L42(L) OF THE ACT WAS SPECIFICALLY ASKED TO FURNISH DETAILS O F ALL THESE BANK ACCOUNTS FOUND DURING COURSE OF SEARCH AND EXP LANATION ABOUT NATURE AND SOURCE OF DEPOSITS THEREIN ALONG W ITH SUPPORTING DOCUMENTS. IT WAS OBSERVED THAT THE ABO VE BANK ACCOUNT WITH THE COSMOS CO-OP. BANK LTD. WAS OPERAT IVE FROM F.Y.2003-04 (A.Y.2004-05). IN VIEW OF THESE FACTS, DECEASED ASSESSEE VIDE SHOW-CAUSE NOTICE DATED 07.12.2011 WA S SPECIFICALLY ASKED ABOUT THESE ISSUES. IN REPLY, DE CEASED ASSESSEE VIDE ITS LETTER RECEIVED BY ASSESSING OFFI CER ON ITA NOS.3496 TO 3498, 4794 & 4795/MUM/15 A.YS. 03-0 4 TO 07-08 [LATE SUNIL D GULATI VS. CIT] PAGE 37 19.12.2011 CLAIMED THAT THESE ACCOUNTS OF M/S. SADG URU ARTS AND CERTAIN CREDIT CARD TRANSACTIONS WERE NOT REFLE CTED IN HIS BALANCE SHEET BECAUSE THE SAME RELATED TO HIS HUF A ND WERE ACCOUNTED FOR IN THAT ENTITY. AFTER CONSIDERING TH E SUBMISSIONS ON BEHALF OF DECEASED ASSESSEE, ASSESSING OFFICER D ID NOT BELIEVE AND ASSESSEES CLAIM WAS THUS REJECTED. AS PER THE COPIES OF BANK STATEMENTS RECEIVED FROM THE BANKS, THERE WERE TOTAL DEPOSITS OF RS.2,01,46,916/- IN THE BANK ACCO UNTS WITH THE COSMOS CO-OP. BANK LTD. AND TAMILNADU MERCANTIL E BANK LIMITED IN F.Y.2005-06 RELEVANT TO YEAR UNDER CONSI DERATION OUT OF WHICH THERE WERE CASH DEPOSITS OF RS.32,33,0 00/-. AS DECEASED ASSESSEE FAILED TO FURNISH EXPLANATION AS REGARDS THE NATURE AND SOURCE OF THE SAID DEPOSITS IN BANK ACCO UNTS, THE AMOUNT OF RS.2,01,46,916/- WAS HELD AS UNACCOUNTED INCOME/ UNDISCLOSED INCOME/ UNEXPLAINED MONEY OF DECEASED A SSESSEE AND ADDED TO THE TOTAL INCOME OF DECEASED ASSESSEE. 25.1 MATTER WAS CARRIED BEFORE THE FIRST APPELLATE AUTHORITY, WHEREIN IT WAS CLAIMED THAT M/S.SADGURU ARTS WAS A PROPRIETARY CONCERN OF LATE SUNIL D. GULATI (HUF) E NGAGED IN THE BUSINESS OF FILM PRODUCTION. IT WAS STATED THAT FOR THIS REASON, THE AFORESAID TWO BANK ACCOUNTS WERE NOT RE FLECTED IN THE ACCOUNTS OF DECEASED ASSESSEE MAINTAINED BY HIM IN HIS INDIVIDUAL CAPACITY. IN THIS REGARD, COPIES OF THE INCOME TAX RETURNS ALONG WITH COMPUTATION OF INCOME, BALANCE S HEET, P&L ACCOUNT OF LATE SUNIL D. GULATI (HUF) FOR A.Y.2004- 05 WERE SUBMITTED AND INTER ALIA CONTENDED THAT AS THERE WA S NO SUBSTANTIAL FILM RELATED BUSINESS CARRIED ON BY M/S . SADGURU ITA NOS.3496 TO 3498, 4794 & 4795/MUM/15 A.YS. 03-0 4 TO 07-08 [LATE SUNIL D GULATI VS. CIT] PAGE 38 ARTS IN THE SUBSEQUENT YEARS AND THERE WAS NO POSIT IVE INCOME, THE RETURNS OF INCOME FOR THE HUF BUSINESS WERE NOT FILED IN THE A.YS. SUBSEQUENT TO A.Y.2004-05. HOWEVER, IT WA S CLAIMED THAT THE SAID BANK ACCOUNTS HAD BEEN DULY REFLECTED IN THE BOOKS OF LATE SUNIL D. GULATI (HUF] AND ACCOUNTED F OR IN THAT ENTITY. AS FAR AS THE BANK ACCOUNTS IN THE NAME OF DECEASED ASSESSEE WAS CONCERNED, IT WAS SUBMITTED THAT BANK ACCOUNTS MAINTAINED WITH TAMILNADU MERCANTILE BANK LIMITED I N THE INDIVIDUAL CAPACITY WERE DULY REFLECTED IN HIS BOOK S OF ACCOUNT. 25.2 CIT(A) HAVING CONSIDERED THE SUBMISSIONS ON BE HALF OF DECEASED ASSESSEE OBSERVED THAT AT THE TIME OF SEAR CH, CERTAIN BANK ACCOUNTS WERE FOUND TO BE NOT DISCLOSED IN THE REGULAR BOOKS OF ACCOUNT OF DECEASED ASSESSEE. THIS INCLUDE D CURRENT ACCOUNT NO.029204301220192 WITH THE COSMOS CO-OP. B ANK LTD., VASHI BRANCH, NAVI MUMBAI HELD IN THE NAME OF M/S. SADGURU ARTS. IN COURSE OF ASSESSMENT PROCEEDINGS, ASSESSEE VIDE LETTER DATED 19.12.2011 CLAIMED THAT THE AFORE SAID BANK ACCOUNT WAS NOT REFLECTED IN HIS BALANCE SHEET BECA USE THE SAME RELATED TO HIS HUF. TO SUPPORT HIS CLAIM, ASSE SSEE PLACED ON RECORD COPY OF INCOME TAX RETURN OF LATE SUNIL D . GULATI HUF (PAN: AAJHS5553H) SHOWING TOTAL INCOME OF RS.6,11,326/- FOR A.Y.2004-05. THE AFORESAID BANK A CCOUNT HELD WITH THE COSMOS CO-OP. BANK LTD. WAS INCORPORA TED IN INCOME TAX RETURN OF THE ASSESSEES HUF. THERE WAS ANOTHER BANK ACCOUNT, VIZ., NO. 117150050800335 WITH TAMILN ADU MERCANTILE BANK LIMITED CLAIMED TO BE IN THE NAME O F HUF AND NOT THAT OF ASSESSEE. CIT(A) FOUND THAT NO RETURN OF LATE SUNIL ITA NOS.3496 TO 3498, 4794 & 4795/MUM/15 A.YS. 03-0 4 TO 07-08 [LATE SUNIL D GULATI VS. CIT] PAGE 39 D. GULATI (HUF) HAS BEEN FILED FOR THE YEAR UNDER C ONSIDERATION DESPITE THE FACT THAT THERE WERE TOTAL DEPOSITS OF RS.1,56,33,474/- IN THE AFORESAID TWO ACCOUNTS OF T HE HUF. SINCE THE SAID BANK ACCOUNTS CLAIMED TO BE PERTAINI NG TO ASSESSEE'S HUF, IT WAS HELD THAT SUBSTANTIVE ADDIT ION ON ACCOUNT OF UNEXPLAINED DEPOSITS OF RS. 1,56,33,4 74/- CONTAINED IN THE BANK ACCOUNT NOS. 117150050800335 AND 029204301220192 WITH TAMILNADU MERCANTILE BANK LIMI TED AND THE COSMOS CO-OP. BANK LTD. RESPECTIVELY HAS TO BE MADE NOT IN THE HANDS OF ASSESSEE BUT IN THE HANDS OF HI S HUF WHICH IS A SEPARATE TAXABLE ENTITY UNDER THE ACT. H OWEVER, CIT(A) OBSERVED THAT ASSESSEE BEING THE KARTA OF HI S HUF PASSED AWAY ON 07.01.2013 AND WAS SURVIVED BY HIS W IFE AND A MINOR DAUGHTER AND SON. IN VIEW OF THIS, IT WAS DEC EASED ASSESSEES WIFE WHO IS THE LEGAL REPRESENTATIVE EVE N OF LATE SUNIL D. GULATI (HUF). CIT(A) OBSERVED THAT THERE IS NO CLARITY IN THE PRESENT CASE AS TO WHETHER UPON THE DEATH OF KARTA (DECEASED ASSESSEE), ANY PARTITION WHETHER TOTAL OR PARTIAL HAS TAKEN PLACE AMONG MEMBERS OF THE FAMILY. ACCORDING TO HIM, PROVISIONS OF SECTION 171(1) OF THE ACT PROVIDES TH AT A HINDU FAMILY HITHERTO ASSESSED AS UNDIVIDED SHALL BE DEEM ED FOR THE PURPOSES OF THE ACT TO CONTINUE TO BE A HUF, EXCEPT WHERE AND IN SO FAR AS A FINDING OF PARTITION HAS BEEN GIVEN UNDER THIS SECTION IN RESPECT OF THE HUF. ASSESSING OFFICER W AS, THEREFORE, DIRECTED TO INTIMATE HIS COUNTERPART HAVING JURISDI CTION OVER THE CASE OF LATE SUNIL D. GULATI (HUF) TO INITIATE NECESSARY ACTION FOR ASSESSING THE SAID AMOUNT OF UNEXPLAINED BANK DEPOSITS IN THE BANK ACCOUNTS NO. 117150050800335 AND ITA NOS.3496 TO 3498, 4794 & 4795/MUM/15 A.YS. 03-0 4 TO 07-08 [LATE SUNIL D GULATI VS. CIT] PAGE 40 029204301220192 WITH TAMILNADU MERCANTILE BANK L IMITED AND THE COSMOS CO-OP. BANK LTD. RESPECTIVELY IN THE HANDS OF THE SAID HUF BY RESORTING TO THE PROVISIONS OF SECT ION 148 R.W.S.150 OF THE ACT. THEREFORE, SUBSTANTIVE ADDIT ION OF RS.1,56,33,474/- (RS.1,14,72,974 + RS.41,60,500) ON ACCOUNT OF UNEXPLAINED BANK DEPOSITS IN THE BANK ACCOUNT NO S. 117150050800335 AND 029204301220192 WITH TAMILNADU MERCANTILE BANK LIMITED AND THE COSMOS CO-OP. BANK LTD. RESPECTIVELY MADE BY ASSESSING OFFICER RESPECTIVELY IN THE HANDS OF DECEASED ASSESSEE WAS DELETED. HOWEVER, IN ORDER TO SAFEGUARD THE INTEREST OF THE REVENUE, IT WAS HELD THAT PROTECTIVE ADDITION OF RS.1,56,33,474/- IN RESPECT OF UNEXPLAINED DEPOSITS IN AFORESAID BANK ACCOUNTS WIL L CONTINUE IN THE HANDS OF ASSESSEE TILL THE SAID AMOUNT IS FI NALLY EXPLAINED/ASSESSED IN THE HANDS OF ASSESSEE'S HUF. 25.3 SIMILAR ISSUE AROSE IN A.Y.2005-06 WHEREIN VID E PARA 16 OF THIS ORDER, SIMILAR PROTECTIVE ADDITION HAS BEEN DELETED BY US. FACTS BEING SIMILAR, SO, FOLLOWING SAME REASONI NG, PROTECTIVE ADDITION IN QUESTION IS DIRECTED TO BE D ELETED. 25.4 AS FAR AS THE DEPOSITS OF RS.45,13,442/- (RS.4 4,73,500/- + RS.39,942/-) IN THE TWO BANK ACCOUNTS BEARING NOS.117150050800336 AND 117700480100052 MAINTAINED WITH TAMILNADU MERCANTILE BANK LTD. IN THE PERSONAL NAME OF DECEASED ASSESSEE WAS CONCERNED, ACCORDING TO REVEN UE, THESE WERE FOUND TO BE NOT DISCLOSED IN THE BALANCE SHEET /BOOKS OF ACCOUNT OF ASSESSEE. SINCE ASSESSEE HAS FAILED TO SUBSTANTIATE THE CLAIM IN REMAND PROCEEDINGS AS WELL AS DURING A PPELLATE ITA NOS.3496 TO 3498, 4794 & 4795/MUM/15 A.YS. 03-0 4 TO 07-08 [LATE SUNIL D GULATI VS. CIT] PAGE 41 PROCEEDINGS, THE ADDITION TO THE TUNE OF RS.45,13,4 42/- IN RESPECT OF SAID TWO BANK ACCOUNTS WAS SUSTAINED. L D. AUTHORIZED REPRESENTATIVE SUBMITTED THAT AMOUNT ALS O BELONGS TO HUF AND NOT TO DECEASED ASSESSEE. MOREOVER, AS STATED ABOVE, ASSESSEE WAS NOT ENGAGED IN LAND TRANSACTION ITSELF BUT DOING THE SAME ON BEHALF OF INVESTORS. HE WAS ONLY LIABLE FOR COMMISSION THEREON. TAKING ALL FACTS AND CIRCUMSTA NCES INTO CONSIDERATION, THIS ADDITION IN QUESTION IS NOT SUS TAINABLE. SO, SAME IS DIRECTED TO BE DELETED. 26. NEXT ISSUE IS WITH REGARD TO ADDITION OF DEAL WISE EXCEL SHEETS (DWES) FOR RS.1,47,000/-. ACCORDING TO ASS ESSING OFFICER, IN ANSWER TO QUESTION NO.4, IN HIS STATEME NT RECORD U/S.132(4) IN COURSE OF SEARCH AT HIS OFFICE, DECEA SED ASSESSEE HAS STATED THAT WHILE DEALING IN 12.5% CIDCO PLOTS, THE CONSIDERATION PAID TO THE FARMERS/INVESTORS WAS BOT H IN CASH AND BY CHEQUES. DURING COURSE OF SEARCH, A NUMBER O F COMPUTER GENERATED SHEETS WERE FOUND AT THE BUSINES S PREMISES OF THE DECEASED ASSESSEE CONTAINING VARIOU S DETAILS IN RESPECT OF EACH PARTICULAR LAND DEAL. THESE SHEETS HEREINAFTER HAVE BEEN TERMED AS 'DEAL WISE EXCEL SHEET' (DWES). EACH SHEET CORRESPONDED TO A PARTICULAR DEAL AND SHOWED THE STATUS OF PAYMENTS MADE BY CHEQUE AS WELL AS IN CASH AS ON A PARTICULAR DATE. THE AMOUNTS OF ON-MONEY PAID WERE FOUND TO BE NOT REFLECTED IN THE BOOKS OF ACCOUNT OF DECEASE D ASSESSEE. DURING COURSE OF POST SEARCH PROCEEDINGS, THE DECEA SED ASSESSEE SUBMITTED FUND FLOW/CASH STATEMENTS COVERI NG FIVE F.YS. FROM 2004-05 TO 2008-09. THESE STATEMENTS SHO WED ITA NOS.3496 TO 3498, 4794 & 4795/MUM/15 A.YS. 03-0 4 TO 07-08 [LATE SUNIL D GULATI VS. CIT] PAGE 42 PERSONAL CASH DEALINGS AS WELL AS THOSE RELATING TO HIS BUSINESS. A PRELIMINARY ANALYSIS OF THESE TWO STATE MENTS REVEALED THAT THEY HAD SEVERAL DEFECTS/ SHORTCOMING S AS OUTLINED IN PARAS 3.3 TO 3.3.4 ON PAGE 3-4 OF THE I MPUGNED ORDER FOR WHICH NO CLARIFICATION WAS GIVEN AT THE T IME OF ASSESSMENT. IT WAS CONCLUDED THAT THESE STATEMENTS DID NOT REFLECT THE TRUE AND CORRECT PICTURE OF THE BUSINES S AND PERSONAL TRANSACTIONS OF THE DECEASED ASSESSEE AND AS SUCH COULD NOT BE RELIED UPON. IN THIS BACKGROUND, DURI NG COURSE OF ASSESSMENT PROCEEDINGS, THE DECEASED ASSESSEE VIDE SHOW CAUSE NOTICE DATED 15.10.2010 WAS ASKED TO FURNISH COMPLETE DETAILS/EXPLANATION IN RESPECT OF ALL SUCH DWES ALO NG WITH SUPPORTING DOCUMENTS AND EVIDENCES. ASSESSING OFFI CER OBSERVED THAT THE PAYMENTS BY CASH WERE REFLECTED N EITHER IN DECEASED ASSESSEES BOOKS OF ACCOUNT PRODUCED DURIN G COURSE OF ASSESSMENT PROCEEDINGS NOR IN CASH FLOW STATEMEN T OF HIS BUSINESS. AS MENTIONED IN PARA 7.2 OF THE IMPUGNED ORDER, DOCUMENTS MARKED ANNEXURES A-L AND A-3 IMPOUNDED FR OM ARENJA OFFICE AND ANNEXURE A-2 SEIZED FROM KAVERI P REMISES CONTAIN SUCH DWES. ON THE BASIS OF THESE DOCUMENTS, ASSESSMENT YEAR-WISE CASH PAYMENTS WERE ANALYSED AN D IT WAS FOUND THAT CASH PAYMENTS AMOUNTING TO RS.1,47,000/- PERTAINED TO A.Y.2006-07 WHICH WERE NOT REFLECTED I N DECEASED ASSESSEE'S BOOKS OF ACCOUNT. IN VIEW OF ABOVE, THE AMOUNT OF UNACCOUNTED CASH PAYMENTS OF RS.1,47,000/- WAS HELD AS UNEXPLAINED EXPENDITURE U/S.69C OF THE ACT. THE ASS ESSING OFFICER ALSO HELD THAT THE UNEXPLAINED EXPENDITURE OF RS.1,47,000/- WOULD NOT BE ALLOWED AS A DEDUCTION U NDER ANY ITA NOS.3496 TO 3498, 4794 & 4795/MUM/15 A.YS. 03-0 4 TO 07-08 [LATE SUNIL D GULATI VS. CIT] PAGE 43 HEAD OF INCOME AS PER PROVISO TO SECTION 69C OF THE ACT. ASSESSING OFFICER ALSO OBSERVED THAT THE AMOUNT OF RS.1,47,000/- COULD NOT BE ALLOWED TO THE DECEASED ASSESSEE AS PER PROVISIONS OF SECTION 40A(3) OF THE ACT AND SAM E WAS ADDED TO THE TOTAL INCOME OF DECEASED ASSESSEE. 26.1 SIMILAR ISSUE AROSE IN A.Y.2003-04 WHERE ASSES SEE HAS BEEN GRANTED RELIEF VIDE PARA 3 OF THIS ORDER. FACT S BEING SIMILAR, SO, FOLLOWING SAME REASONING, ADDITION OF RS. 1,47,000/- IS DIRECTED TO BE DELETED. 27. NEXT ISSUE BEFORE US IS WITH REGARD TO ADDITION MADE ON ACCOUNT OF CASH/UNACCOUNTED TRANSACTION OF RS.43,14 ,000/- BY TREATING IT AS UNEXPLAINED EXPENDITURE U/S.69C OF T HE ACT. DURING COURSE OF THE SEARCH, A NUMBER OF CASH RECEI PTS CONTAINING DETAILS OF CASH PAYMENTS MADE BY DECEASE D ASSESSEE AGGREGATING TO RS.1.11 CRORES IN RESPECT O F VARIOUS LAND DEALS HAVE BEEN SEIZED/IMPOUNDED AS TABULATED IN PARA 8.1 ON PAGE 17 OF THE IMPUGNED ORDER. DURING COURSE OF ASSESSMENT PROCEEDINGS, ASSESSING OFFICER IN RESPEC T OF ALL THE RECEIPTS MENTIONED IN PARA 8.1 ON PAGE 17 ASKED THE DECEASED ASSESSEE TO FURNISH COMPLETE DETAILS/EXPLANATION AL ONG WITH SUPPORTING DOCUMENTS AND EVIDENCES VIDE SHOW CAUSE NOTICE DATED 15.10.2010. IN RESPONSE TO SAME, THE DECEASED ASSESSEE COULD NOT SUBMIT ANY DETAIL. UNDER THESE CIRCUMSTA NCES, IT WAS PRESUMED BY ASSESSING OFFICER THAT THE DECEASED ASSESSEE HAD NOTHING TO SAY. ASSESSING OFFICER NOTICED THAT THE ABOVE CASH PAYMENTS WERE APPEARING NEITHER IN THE BOOKS O F ACCOUNT NOR CASH FLOW STATEMENT SUBMITTED BY DECEASED ASSES SEE IN ITA NOS.3496 TO 3498, 4794 & 4795/MUM/15 A.YS. 03-0 4 TO 07-08 [LATE SUNIL D GULATI VS. CIT] PAGE 44 POST SEARCH PROCEEDINGS ON 18.04.2009. IN VIEW OF ABOVE, THE UNACCOUNTED CASH PAYMENTS AMOUNTING TO RS.43,14,000 /- PERTAINING TO A.Y.2006-07 WERE HELD AS UNEXPLAINED EXPENDITURE AND ADDED BACK TO THE TOTAL INCOME OF D ECEASED ASSESSEE. ASSESSING OFFICER ALSO HELD THAT THE UNE XPLAINED EXPENDITURE OF RS.43,14,000/- WOULD NOT BE ALLOWED AS A DEDUCTION UNDER ANY HEAD OF INCOME AS PER PROVISO T O SECTION 69C OF THE ACT. 27.1 WE FIND THAT SIMILAR ISSUE AROSE IN A.Y. 2005- 06 WHEREIN VIDE PARA 18 OF THIS ORDER, WE HAVE GRANTED RELIEF TO ASSESSEE. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, A DDITION IN QUESTION IS DIRECTED TO BE DELETED. 28. NEXT ISSUE IS WITH REGARD TO ADDITION MADE ON A CCOUNT OF OTHER CASH/UNACCOUNTED TRANSACTIONS FOR RS.4LACS. ASSESSING OFFICER OBSERVED THAT PAGE NO.14 OF ANNEXURE A-L IM POUNDED FROM ARNEJA OFFICE OF THE DECEASED ASSESSEE SHOWED DATE-WISE DETAILS OF PAYMENTS MADE BETWEEN 15.02.2004 TO 12.0 9.2007 IN CASH AND CHEQUES TO VARIOUS FARMERS/BROKERS IN R ESPECT OF VARIOUS PROPERTIES/PLOTS. THE DECEASED ASSESSEE VID E SHOW CAUSE NOTICES WAS ASKED TO FURNISH SOURCE OF THESE PAYMENTS ALONG WITH SUPPORTING DOCUMENTS AND OTHER RELEVANT DETAILS. BUT THE DECEASED ASSESSEE FAILED TO SUBMIT ANY DETA ILS, EXPLANATION AND SUPPORTING DOCUMENTS IN THIS REGARD . UNDER THESE CIRCUMSTANCES, IT WAS PRESUMED THAT THE DECEA SED ASSESSEE HAD NOTHING TO SAY IN THIS REGARD. IN SUC H CIRCUMSTANCES, IT WAS PRESUMED BY ASSESSING OFFICER THAT THESE PAYMENTS WERE NEITHER REFLECTED IN THE BOOKS OF ACCOUNT ITA NOS.3496 TO 3498, 4794 & 4795/MUM/15 A.YS. 03-0 4 TO 07-08 [LATE SUNIL D GULATI VS. CIT] PAGE 45 NOR INCLUDED IN THE FUND/CASH FLOW STATEMENTS SUBMI TTED BY THE DECEASED ASSESSEE DURING POST SEARCH PROCEEDING S. IT WAS FURTHER NOTED FROM THE DATE-WISE ENTRIES OF VARIOUS PAYMENTS THAT UNACCOUNTED CASH PAYMENTS OF RS.4,00,000/- PER TAINED TO A.Y.2006-07. IN VIEW OF THE ABOVE, THE UNACCOUNTED CASH PAYMENTS AMOUNTING TO RS.4,00,000/- PERTAINING TO A .Y.2006- 07 WERE HELD AS UNEXPLAINED EXPENDITURE U/S.69C OF THE ACT AND ADDED TO THE TOTAL INCOME OF THE DECEASED ASSES SEE. IT WAS ALSO HELD THAT THE SAID UNEXPLAINED EXPENDITURE OF RS.4,00,000/- WOULD NOT BE ALLOWED AS A DEDUCTION A S PER PROVISO TO SECTION 69C OF THE ACT UNDER ANY HEAD OF INCOME. 28.1 WE FIND THAT SIMILAR ISSUE AROSE IN A.Y. 2005- 06 WHICH WAS DECIDED IN FAVOUR OF ASSESSEE VIDE PARA 19 OF T HIS ORDER. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, A DDITION IN QUESTION IS DIRECTED TO BE DELETED. 29. NEXT ISSUE IS WITH REGARD TO ADDITION ON ACCOUN T OF CURRENT LIABILITIES AND UNSECURED LOAN AS CASH CREDIT OF R S.43,32,400/- U/S.68 OF THE ACT. ASSESSING OFFICER NOTICED THAT DECEASED ASSESSEE HAD NOT FILED HIS COMPLETE TAX AUDIT REPOR T ALONG WITH ITS ANNEXURES. THIS WAS POINTED OUT TO DECEASED AS SESSEE VIDE SHOW CAUSE NOTICE, BUT DECEASED ASSESSEE FAILED TO MAKE ANY SUBMISSION IN THIS REGARD. AS PER BALANCE SHEET OF F.Y. 2005- 06, IT WAS OBSERVED THAT DECEASED ASSESSEE HAD SHOW N UNSECURED LOANS OF RS.16,06,610/- IN NAME OF VARIOU S PARTIES. ASSESSEE VIDE NOTICE U/S.142(1) OF THE ACT DATED 03 .08.2010 WAS ASKED TO FURNISH VARIOUS DETAILS IN RESPECT OF SUCH LOANS. BUT EVEN AFTER LAPSE OF MORE THAN ONE AND HALF YEAR S, THE ITA NOS.3496 TO 3498, 4794 & 4795/MUM/15 A.YS. 03-0 4 TO 07-08 [LATE SUNIL D GULATI VS. CIT] PAGE 46 DECEASED ASSESSEE HAD FAILED TO SUBMIT THOSE DETAIL S. THE DECEASED ASSESSEE ALSO AILED TO SUBMIT THE RELEVANT DETAILS LIKE ADDRESS, PAN, HIS BANK ACCOUNT STATEMENT AND PARTIE S' BANK ACCOUNT STATEMENTS, ACCOUNT CONFIRMATION LETTERS, C OPIES OF THE PARTIES' INCOME TAX RETURNS, ETC. THE ASSESSING OF FICER NOTED THAT IN RESPECT OF SUCH CREDIT ENTRIES, THE ONUS WA S ON THE DECEASED ASSESSEE TO ESTABLISH IDENTITY AND CREDITW ORTHINESS OF THE PARTIES CONCERNED AND GENUINENESS OF SUCH TRANS ACTIONS U/S.68 OF THE ACT. SINCE THE DECEASED ASSESSEE HAD FAILED TO DISCHARGE THE ONUS U/S.68 OF THE ACT, THE SAID AMOU NT OF UNSECURED LOANS OF RS.16,06,610/- WAS HELD AS UNEXP LAINED CASH CREDIT AND ADDED TO THE TOTAL INCOME OF THE DE CEASED ASSESSEE U/S.68 OF THE ACT. 29.1 THE DECEASED ASSESSEE HAD SHOWN CURRENT LIABIL ITIES OF RS.74,22,400/- AGAINST VARIOUS PARTIES/NARRATIONS. THE DECEASED ASSESSEE WAS SERVED NOTICE WHEREBY HE WAS ASKED TO FURNISH VARIOUS DETAILS IN RESPECT OF SUCH PARTIES. BUT THE DECEASED ASSESSEE FAILED TO SUBMIT DETAILS LIKE PAN , HIS BANK ACCOUNT STATEMENT AND PARTIES' BANK ACCOUNT STATEME NTS, ACCOUNT CONFIRMATION LETTERS, ETC. ASSESSING OFFIC ER TOOK NOTE OF THE FACT THAT IN RESPECT OF SUCH CREDIT ENTRIES, THE ONUS WAS ON THE DECEASED ASSESSEE TO ESTABLISH IDENTITY AND CREDITWORTHINESS OF THE CONCERNED PARTIES AND GENUI NENESS OF SUCH TRANSACTIONS U/S.68 OF THE ACT. AS THE DECEAS ED ASSESSEE HAD FAILED TO DISCHARGE THE ONUS U/S.68 OF THE ACT, THE AMOUNT OF RS.74,22,400/-WAS HELD AS UNEXPLAINED CASH CREDI T U/S.68 ITA NOS.3496 TO 3498, 4794 & 4795/MUM/15 A.YS. 03-0 4 TO 07-08 [LATE SUNIL D GULATI VS. CIT] PAGE 47 OF THE ACT BY THE ASSESSING OFFICER AND ADDED TO TH E TOTAL INCOME OF THE DECEASED ASSESSEE. 29.2 WITH REGARD TO ADDITION OF UNSECURED LOANS OF RS.L6,06,610/-. IN APPEAL, CIT(A) HELD AS UNDER: 9.3.1 I HAVE CONSIDERED THE SUBMISSIONS OF THE APP ELLANT AND PERUSED THE MATERIALS AVAILABLE ON RECORD. IT I S SEEN FROM THE RECORD THAT THE A.O. TREATED THE ABOVE UNS ECURED LOANS AGGREGATING TO RS.16,06,610/- AS UNEXPLAINED CASH CREDITS U/S.68 OF THE ACT AS THE APPELLANT FAILED T O DISCHARGE THE ONUS OF PROVING THE IDENTITY AND FINANCIAL CAPA CITY OF THE SAID PARTIES AS WELL AS GENUINENESS OF LOANS AT THE TIME OF ASSESSMENT. IN THE COURSE OF APPELLATE PROCEEDINGS, THE APPELLANT FURNISHED ADDITIONAL EVIDENCES BY WAY OF CONFIRMATIONS OF THE SAID PARTIES AND PRAYED THAT T HE SAME MIGHT BE ADMITTED UNDER RULE 46A, AS THE APPELLANT WAS PREVENTED BY SUFFICIENT CAUSE FROM FURNISHING THE S AME BEFORE THE A.O. II IS STATED THAT THE APPELLANT COU LD NOT FURNISH THE CONFIRMATIONS AS SOME OF THE PARTIES WE RE NOT READILY TRACEABLE/ HAD SHIFTED FROM THEIR ADDRESS A ND THE TIME GIVEN BY THE A.O. WAS VERY SHORT. IN VIEW OF T HE SUBMISSIONS OF THE APPELLANT, THE SAID ADDITIONAL E VIDENCE FILED BY THE APPELLANT WAS ADMITTED AND SENT TO THE A.O. CALLING FOR REMAND REPORT AFTER VERIFICATION OF THE SAID EVIDENCE. THE A.O. FORWARDED HIS REMAND REPORT VIDE LETTER DATED 19.12.2014 COPY OF WHICH WAS PROVIDED TO THE APPELLANT FOR SUBMITTING HIS REJOINDER, IF ANY. SIN CE NO REJOINDER WAS FURNISHED BY THE APPELLANT, THE MATTE R IS DISPOSED OF IN LIGHT OF THE ADDITIONAL EVIDENCES PL ACED ON RECORD AND THE FINDINGS CONTAINED IN THE REMAND REP ORT. 9.3.2 A PERUSAL OF THE REMAND REPORT REVEALS THAT O UT OF UNSECURED LOANS OF RS.16,06,610/-, IT IS STATED TH AT UNSECURED LOANS AMOUNTING TO RS.5,00,000/- AND RS.38,000/- TAKEN FROM M/S.SANGRAM PATIL AND M/S.SHUBHAM ESTATE CONSULTANT VERY SHORT. IN VIEW O F THE SUBMISSIONS OF THE APPELLANT, THE SAID ADDITIONAL E VIDENCE FILED BY THE APPELLANT WAS ADMITTED AND SENT TO THE A.O. CALLING FOR REMAND REPORT AFTER VERIFICATION OF THE SAID EVIDENCE. THE A.O. FORWARDED HIS REMAND REPORT VIDE LETTER ITA NOS.3496 TO 3498, 4794 & 4795/MUM/15 A.YS. 03-0 4 TO 07-08 [LATE SUNIL D GULATI VS. CIT] PAGE 48 DATED 19.12.2014 COPY OF WHICH WAS PROVIDED TO THE APPELLANT FOR SUBMITTING HIS REJOINDER, IF ANY. SIN CE NO REJOINDER WAS FURNISHED BY THE APPELLANT, THE MATTE R IS DISPOSED OF IN LIGHT OF THE ADDITIONAL EVIDENCES PL ACED ON RECORD AND THE FINDINGS CONTAINED IN THE REMAND REP ORT. 9.3.4 A PERUSAL OF THE REMAND REPORT REVEALS THAT R EGARDING AMOUNT OF RS. 30,22,400/- IN THE NAME OF SHRI RAVI BANGAR, IT IS STATED THAT AN AMOUNT OF RS.3,00,000/- PERTAI NED TO EARLIER A.Y (WHICH WAS ALSO ADDED IN THAT YEAR) AND RS.60,000/- WAS REPAYMENT DURING THE YEAR. IN THIS REGARD, NOTICE U/S. 133(6) OF THE ACT WAS ISSUED TO THE PAR TY BY THE A.O. HOWEVER, THE PARTY FAILED TO PROVIDE ANY EVIDE NCE ON THE PRETEXT THAT THE MATTER WAS VERY OLD. THIS LED THE A.O. TO DRAW AN ADVERSE INFERENCE IN THE MATTER BY CONCLUDI NG THAT THE APPELLANT HAD FAILED TO PROVE THE GENUINENESS O F THE CREDITOR EVEN AT THE REMAND STAGE. HOWEVER, IT IS H ELD THAT THE NET ADDITION IN RESPECT OF THIS CREDIT WILL BE RESTRICTED TO RS.27,22,400/- (RS.30,22,400 MINUS RS.3,00,000). AS REGARDS CREDIT BALANCE OF RS.11,00,000/- IN THE NAM E OF SMT.MEENA KHONA (M/S.B.M.KHONA HUF), THE APPELLANT FILED AN MOU DATED 02.03.2006 BEFORE THE A.O. IN RE MAND PROCEEDINGS AND EXPLAINED THAT THIS AMOUNT WAS RECE IVED AS ADVANCE FOR ACQUIRING PLOT OF LAND ON BEHALF OF SMT .MEENAL KHONA (M/S.B.M.KHONA HUF). DURING THE COURSE OF REM AND PROCEEDINGS, THE A.O. SENT NOTICES U/S.133(6) OF TH E ACT TO SMT.MEENAL KHONA AND SHRI B.M.KHONA. SMT. MEENAL KHONA IN HER REPLY TO THE A.O. DENIED HAVING EVER D EALT WITH THE APPELLANT. IN RESPONSE TO THE SAID NOTICE, SHRI B.M.KHONA SUBMITTED THAT THE SAID AMOUNT HAD BEEN G IVEN AS AN ADVANCE TO THE APPELLANT FOR PURCHASE OF PLOT . HOWEVER, THE ASSESSEE FAILED TO PERFORM HIS DUTY AN D THE PARTY HAD SUFFERED LOSS IN THIS REGARD. THE A.O. HA S OPINED THAT THE ADVANCE RECEIVED BY THE APPELLANT AMOUNTIN G TO RS.47,00,000/- WAS NOT RETURNED AND SO THE ADDITION OF RS.11,00,000/- MADE BY THE A.O. SHOULD BE SUSTAINED . I DO NOT FIND ANY REASON TO DIFFER FROM THE FINDINGS OF THE A.O. CONTAINED IN HIS REMAND REPORT REFERRED TO ABOVE. I T IS A MATTER OF RECORD THAT THE APPELLANT HAS NEITHER MAD E ANY ATTEMPT TO REBUT THE FINDINGS OF THE A.O. AS CONTAI NED IN THE REMAND REPORT NOR FURNISHED ANY CONCRETE EVIDENCE V IZ. SALE DEED OF PLOT SAID TO HAVE BEEN BOOKED AS INCOME IN THE NEXT A.Y. ETC. TO DISCHARGE THE ONUS PLACED ON HIM IN TH IS REGARD. ITA NOS.3496 TO 3498, 4794 & 4795/MUM/15 A.YS. 03-0 4 TO 07-08 [LATE SUNIL D GULATI VS. CIT] PAGE 49 IT IS NOTICED FROM THE RECORD THAT ADDITION OF UNEX PLAINED CREDIT OF RS.64,75,000/- IN THE NAME OF M/S.HAWARE ENGINEERING AND BUILDERS PVT. LTD. WAS MADE BY THE A.O. IN A.Y.2005-06 ITSELF AND THERE BEING NO FRESH RECEIPT OF LOAN OR ADVANCE FROM THE SAID PARTY BUT ONLY REPAYMENT OF RS.31,75,000/- TO THE SAID PARTY DURING THE YEAR, T HE A.O. WAS NOT JUSTIFIED IN MAKING ADDITION OF RS.33,00,00 0/- AGAIN IN THE A.Y. UNDER CONSIDERATION. IN VIEW OF T HE ABOVE DISCUSSION, ADDITIONS AGGREGATING TO RS.36,00,000/- (RS.3,00,000 + RS.33,00,000) TOWARDS UNEXPLAINED CREDITS/CURRENT LIABILITIES MADE BY THE A.O. ARE DI RECTED TO BE DELETED. HOWEVER, THE BALANCE ADDITION OF RS.38, 22,400/- (RS.27,22,400 + RS.11,00,000) MADE BY THE A.O. ON A CCOUNT OF UNEXPLAINED CURRENT LIABILITIES/CREDITORS U/S.68 IS FOUND TO BE JUSTIFIED AS THE APPELLANT HAS FAILED TO ESTA BLISH THE IDENTITY AND CREDITWORTHINESS OF THE CONCERNED PART IES AND GENUINENESS OF THE TRANSACTIONS EVEN AT THE APPELLA TE STAGE. THEREFORE, THE SAID ADDITION OF RS.38,22,400/- OUT OF CURRENT LIABILITIES IS SUSTAINED. GROUND NO.6 OF THE PRESEN T APPEAL IS ALLOWED TO THE EXTENT INDICATED ABOVE. 29.3 SIMILAR ISSUE AROSE IN A.Y.2005-06, WHICH WAS DECIDED IN FAVOUR OF ASSESSEE VIDE PARA 20 OF THIS ORDER. FACT S BEING SIMILAR, SO FOLLOWING SAME REASONING, WE ARE NOT IN CLINED TO CONCUR WITH THE FINDING OF CIT(A) AND ADDITIONS IN QUESTION ARE DIRECTED TO BE DELETED. 30. NEXT ISSUE IS WITH REGARD TO ESTIMATED HIGHER W ITHDRAWALS OF RS.2,08,829/-. ASSESSING OFFICER MADE THIS ADDI TION ON ACCOUNT OF RS.6,28,823/-. IN APPEAL, PARTIAL RELIE F WAS GRANTED TO ASSESSEE BY CIT(A). 30.1 WE FIND THAT THIS WHOLE ADDITION ON ACCOUNT OF ESTIMATED HIGHER WITHDRAWALS HAVING NO NEXUS WITH THE SEIZED MATERIAL, SO ADDITION IN QUESTION U/S.153A R.W.S. 143(3) OF T HE ACT ARE NOT JUSTIFIED. SAME IS DIRECTED TO BE DELETED. ITA NOS.3496 TO 3498, 4794 & 4795/MUM/15 A.YS. 03-0 4 TO 07-08 [LATE SUNIL D GULATI VS. CIT] PAGE 50 31. NEXT ISSUE IS WITH REGARD TO DISALLOWANCE OF RS .53,398 MADE ON ACCOUNT OF PERSONAL ELEMENT. AGAIN, THIS A DDITION ON ACCOUNT OF DISALLOWANCE OF RS.53,398/- MADE ON ACCO UNT OF PERSONAL ELEMENT IS NOT HAVING NEXUS WITH THE SEIZE D MATERIAL, SO SAME IS DIRECTED TO BE DELETED. 32. ASSESSING OFFICER NOTICED THAT ASSESSEE HAD CLA IMED BANK INTEREST AND BANK CHARGES OF RS.3,26,084/- IN P&L A CCOUNT AND AS PER ASSESSEES BALANCE SHEET, LOANS WERE PER SONAL IN NATURE. SO, ASSESSEE WAS ASKED AS TO WHY THE INTER EST SHOULD NOT BE DISALLOWED U/S.36(1)(VII) OF THE ACT. THE S TAND OF ASSESSEE HAS BEEN THAT THOUGH ASSESSEES LOAN RAISE D THROUGH PERSONAL GUARANTEE BUT SAME HAS BEEN USED FOR BUSIN ESS PURPOSE. ASSESSING OFFICER NOTED THAT ASSESSEE HAS NOT MAINTAINED ANY SEPARATE ACCOUNTS FOR HIS BUSINESS T O JUSTIFY HIS CLAIM. SO, HE MADE DISALLOWANCE OF RS.3,26,084 /- U/S.36(1)(III) OF THE ACT. CIT(A) GAVE PARTIAL REL IEF WHEREBY SUSTAINING INTEREST EXPENSES OF RS.1,75,262/-. REV ENUE HAS NOT FILED ANY APPEAL AGAINST THE RELIEF GRANTED TO ASSESSEE. BEFORE US, NOTHING WAS ARGUED ON BEHALF OF ASSESSEE ON THIS ACCOUNT. ON OTHER HAND, LD. DEPARTMENTAL REPRESENT ATIVE SUPPORTED THE ORDER OF CIT(A). 32.1 AFTER GOING THROUGH RIVAL SUBMISSIONS AND PERU SED THE MATERIAL ON RECORD, WE FIND THAT IT IS EVIDENT FROM THE RECORD THAT ASSESSEE HAS DEBITED THE AMOUNTS IN QUESTION. ASSESSEE COULD NOT SUBSTANTIATE THE CLAIM BEFORE AUTHORITIES BELOW. SO, CIT(A) WAS JUSTIFIED IN SUSTAINING THE DISALLOWANCE OF EXPENSES ITA NOS.3496 TO 3498, 4794 & 4795/MUM/15 A.YS. 03-0 4 TO 07-08 [LATE SUNIL D GULATI VS. CIT] PAGE 51 OF RS.1,75,262/-. THIS REASONED FACTUAL FINDING OF CIT(A) NEEDS NO INTERFERENCE FROM OUR SIDE. WE UPHOLD THE SAME. 33. AS A RESULT, APPEAL FILED BY ASSESSEE IS PARTLY ALLOWED. 34. IN ITA NO.4794/MUM/2015 FOR A.Y.2007-08, DECEAS ED ASSESSEE HAS FILED THE APPEAL ON THE FOLLOWING GROU NDS: GROUND I :- ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LEARNED COMMISSIONER OF INCOME TAX (APPEAL) - 54, MUMBAI ('HEREINAFTER REFERRED TO AS 'THE CIT(A)') H AS ERRED IN MAKING PROTECTIVE ASSESSMENT OF RS.21,60,000/-. THE APPELLANT BEING AGGRIEVED, PRAYS THAT THE ADDIT ION MADE ON ACCOUNT OF UNACCOUNTED BANK ACCOUNTS TO THE EXTENT OF RS.21,60,000/- BEING UNJUSTIFIED, UNWARRANTED, BAD IN LAW AND ILLEGAL BE DELETED. GROUND II :- ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LEARNED COMMISSIONER OF INCOME TAX (APPEAL) - 54, MUMBAI ('HEREINAFTER REFERRED TO AS 'THE CIT(A)') H AS ERRED IN CONFIRMING AN ADDITION OF RS.1,04,000/- AS UNEXPLAINED DEPOSITS U/S.68 IN RESPECT OF THE TWO SAVINGS BANK ACCOUNT ALLEGED AS UNDISCLOSED IN THE BALANCE SHEET/BOOKS OF ACCOUNTS. THE APPELLANT BEING AGGRIEVED, PRAYS THAT THE ADDIT ION MADE ON ACCOUNT OF UNEXPLAINED DEPOSITS/ UNACCOUNTED BANK ACCOUNTS TO THE EXTENT OF RS.1,04,000/- BEING UNJUSTIFIED, UNWARRANTED, BAD I N LAW AND ILLEGAL BE DELETED. GROUND III :- ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LEARNED COMMISSIONER OF INCOME TAX (APPEAL) - 54, ITA NOS.3496 TO 3498, 4794 & 4795/MUM/15 A.YS. 03-0 4 TO 07-08 [LATE SUNIL D GULATI VS. CIT] PAGE 52 MUMBAI ('HEREINAFTER REFERRED TO AS 'THE CIT(A)') H AS ERRED IN UPHOLDING THE ADDITION MADE ON ACCOUNT OF DEAL WISE EXCEL SHEET FOR A SUM OF RS.7,02,000/- AS UNEXPLAINED EXPENDITURE U/S.69C OF THE ACT. THE APPELLANT BEING AGGRIEVED, PRAYS THAT THE ADDIT ION MADE ON ACCOUNT OF UNEXPLAINED EXPENDITURE TO THE EXTENT OF RS.7,02,000/- BEING UNJUSTIFIED, UNWARRANTED, BAD IN LAW AND ILLEGAL BE DELETED. GROUND IV :- ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(A) HAS ERRED IN CONFIRMING THE ADDITION MADE ON ACCOUNT OF OTHER CASH/UNACCOUNTED TRANSACTION FOR RS.35,000/- BY TREATING IT AS UNEXPLAINED EXPENDITURE U/S.69C OF THE ACT. THE APPELLANT BEING AGGRIEVED, PRAYS THAT THE ADDIT ION MADE ON ACCOUNT OF UNEXPLAINED EXPENDITURE U/S. 69C TO THE EXTENT OF RS.35,000/- BEING UNJUSTIFIED, UNWARRANTED, BAD IN LAW AND ILLEGAL BE DELETED. GROUND V :- ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(A) HAS ERRED IN CONFIRMING THE ADDITION MADE ON ACCOUNT OF OTHER CASH/UNACCOUNTED TRANSACTION FOR RS.1,72,00,000/- BY TREATING IT AS UNEXPLAINED EXPENDITURE U/S.69C OF THE ACT. THE APPELLANT BEING AGGRIEVED, PRAYS THAT THE ADDIT ION MADE ON ACCOUNT OF UNEXPLAINED EXPENDITURE U/S. 69C TO THE EXTENT OF RS. 1,72,00,000/- BEING UNJUSTIFIE D, UNWARRANTED, BAD IN LAW AND ILLEGAL BE DELETED. GROUND VI :- ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(A) HAS ERRED IN CONFIRMING THE ADDITION MADE ON ACCOUNT OF CURRENT LIABILITIES AND UNSECURE D LOANS AS UNEXPLAINED CASH CREDIT FOR RS. 1,45,00,00 0/- U/S. 68 OF THE ACT. ITA NOS.3496 TO 3498, 4794 & 4795/MUM/15 A.YS. 03-0 4 TO 07-08 [LATE SUNIL D GULATI VS. CIT] PAGE 53 THE APPELLANT BEING AGGRIEVED, PRAYS THAT THE ADDIT ION MADE ON ACCOUNT OF CURRENT LIABILITIES AND UNSECURE D LOANS AS UNEXPLAINED CASH CREDIT U/S. 68 TO THE EXT ENT OF RS. 1,45,00,000/- BEING UNJUSTIFIED, UNWARRANTED , BAD IN LAW AND ILLEGAL BE DELETED. GROUND VII :- ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(A) HAS ERRED IN CONFIRMING THE ADDITION MADE ON ACCOUNT OF DIFFERENCE IN ESTIMATED HIGHER WITHDRAWALS AT RS. 19,261/- THAN SHOWN IN CAPITAL ACCOUNT AT RS. 8,20,739/- ON ACCOUNT OF WITHDRAWALS . THE APPELLANT BEING AGGRIEVED, PRAYS THAT THE ADDIT ION MADE ON ACCOUNT OF DIFFERENCE IN ESTIMATED HIGHER WITHDRAWALS TO THE EXTENT OF RS. 19,261/- BEING UNJUSTIFIED, UNWARRANTED, BAD IN LAW AND ILLEGAL BE DELETED. GROUND VIII :- ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(A) HAS ERRED IN CONFIRMING THE DISALLOWANCE OF RS.36,208/- MADE ON ACCOUNT OF PERSONAL ELEMENT IN CERTAIN EXPENSES. THE APPELLANT BEING AGGRIEVED PRAYS THAT THE ADDITI ON MADE ON ACCOUNT OF ESTIMATED PERSONAL ELEMENT IN CERTAIN EXPENSES TO THE EXTENT OF RS. 36,208/- BEIN G UNJUSTIFIED, UNWARRANTED, BAD IN LAW AND ILLEGAL BE DELETED. GROUND IX :- ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(A) HAS ERRED IN CONFIRMING THE ADDITION MADE ON ACCOUNT OF DISALLOWANCE OF INTEREST U/S.36(1)(III) TO THE EXTENT OF RS.4,93,674/- ALLEG ING IT BEING NOT FOR THE BUSINESS PURPOSE. THE APPELLANT BEING AGGRIEVED PRAYS THAT THE ADDITI ON ITA NOS.3496 TO 3498, 4794 & 4795/MUM/15 A.YS. 03-0 4 TO 07-08 [LATE SUNIL D GULATI VS. CIT] PAGE 54 MADE ON ACCOUNT OF DISALLOWANCE OF INTEREST U/S.36(1)(III) TO THE EXTENT OF RS.4,93,674/- BEING UNJUSTIFIED, UNWARRANTED, BAD IN LAW AND ILLEGAL BE DELETED. 35. FIRST ISSUE IS WITH REGARD TO PROTECTIVE ASSESS MENT OF RS.21,60,000/-. SIMILAR ISSUE AROSE IN A.Y. 2005-0 6 VIDE PARA 16 OF THIS ORDER WHEREIN WE HAVE DELETED THE PROTEC TIVE ADDITION. FACTS BEING SIMILAR, SO FOLLOWING SAME R EASONING, PROTECTIVE ASSESSMENT OF RS.21,60,000/- IS DIRECTED TO BE DELETED. 36. NEXT ISSUE IS WITH REGARD TO ADDITION OF RS.1,0 4,000/- AS UNEXPLAINED DEPOSITS U/S.68 OF THE ACT IN RESPECT O F THE TWO SAVINGS BANK ACCOUNT. SIMILAR ISSUE AROSE IN A.Y. 2005-06 WHICH HAS BEEN DECIDED IN FAVOUR OF ASSESSEE VIDE P ARA 19 OF THIS ORDER. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, ADDITION IN QUESTION IS DIRECTED TO BE DELETED. 37. NEXT ISSUE IS WITH REGARD TO ADDITION MADE ON A CCOUNT OF DEAL WISE EXCEL SHEET FOR A SUM OF RS.7,02,000/- AS UNEXPLAINED EXPENDITURE U/S.69C OF THE ACT. SIMILA R ADDITION MADE IN A.Y. 2003-04 WHICH HAS BEEN DELETED BY US V IDE PARA 3 OF THIS ORDER. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, ADDITION IN QUESTION IS DIRECTED TO BE D ELETED. 38. NEXT ISSUE IS WITH REGARD TO ADDITION MADE ON A CCOUNT OF OTHER CASH/UNACCOUNTED TRANSACTION FOR RS.35,000/- BY TREATING IT AS UNEXPLAINED EXPENDITURE U/S.69C OF T HE ACT. SIMILAR ADDITION WAS MADE IN A.Y. 2004-05 WHICH HAS BEEN DELETED BY US IN PARA 10 OF THIS ORDER BECAUSE ASSE SSEE WAS ITA NOS.3496 TO 3498, 4794 & 4795/MUM/15 A.YS. 03-0 4 TO 07-08 [LATE SUNIL D GULATI VS. CIT] PAGE 55 ONLY PROPERTY AGENT. FACTS BEING SIMILAR, SO FOLLOW ING SAME REASONING, ADDITION IN QUESTION IS DIRECTED TO BE D ELETED. 39. NEXT ISSUE IS WITH REGARD TO ADDITION MADE ON A CCOUNT OF OTHER CASH/UNACCOUNTED TRANSACTION FOR RS.1,72,00,0 00/- BY TREATING IT AS UNEXPLAINED EXPENDITURE U/S.69C OF T HE ACT. SIMILAR ISSUE AROSE IN A.Y. 2003-04, WHICH HAS BEEN DELETED BY US VIDE PARA 3 OF THIS ORDER. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, ADDITION IN QUESTION IS DIRECTED TO BE DELETED. 40. NEXT ISSUE IS WITH REGARD TO ADDITION MADE ON A CCOUNT OF CURRENT LIABILITIES AND UNSECURED LOANS AS UNEXPLAI NED CASH CREDIT OF RS.1,45,00,000/-. SIMILAR ISSUE AROSE IN A.Y. 2003-04 WHICH HAS BEEN DISCUSSED AND DECIDED BY US IN FAVOU R OF ASSESSEE VIDE PARA 5 OF THIS ORDER. FACTS BEING SI MILAR, SO FOLLOWING SAME REASONING, ADDITION IN QUESTION IS D IRECTED TO BE DELETED. 41. NEXT ISSUE IS WITH REGARD TO ADDITION MADE ON A CCOUNT OF HOUSEHOLD WITHDRAWALS. THIS ADDITION IN QUESTION IS NOT HAVING NEXUS WITH THE SEIZED MATERIAL, SO SAME IS DIRECTED TO BE DELETED. 42. NEXT ISSUE IS WITH REGARD TO DISALLOWANCE OF RS .36,208/- MADE ON ACCOUNT OF PERSONAL ELEMENT. AGAIN THIS AD DITION HAS NO NEXUS WITH THE SEIZED MATERIAL, SO SAME IS DIREC TED TO BE DELETED. 43. NEXT ISSUE IS WITH REGARD TO DISALLOWANCE OF IN TEREST U/S.36(1)(III) OF THE ACT TO THE EXTENT OF RS.4,93, 674/- ALLEGED TO ITA NOS.3496 TO 3498, 4794 & 4795/MUM/15 A.YS. 03-0 4 TO 07-08 [LATE SUNIL D GULATI VS. CIT] PAGE 56 BE NOT BEING FOR BUSINESS PURPOSE. SIMILAR ISSUE A ROSE IN A.Y. 2006-07, WHEREIN CIT(A) GRANTED PARTIAL RELIEF AND UPHOLD BY US VIDE PARA 33 OF THIS ORDER. FACTS BEING SIMILAR , SO FOLLOWING SAME REASONING, WE UPHOLD THE SAME. 44. AS A RESULT, ASSESSEES APPEAL IS PARTLY ALLOWE D. 45. IN THE RESULT, APPEALS FILED BY ASSESSEE A.YS. 2003-04 TO 2005-06 ARE ALLOWED AND FOR A.YS.2006-07 & 2007-08 ARE PARTLY ALLOWED. PRONOUNCED IN THE OPEN COURT ON THIS THE 19 TH DAY OF AUGUST, 2016. SD/- SD/- ( RAJESH KUMAR ) (SHAILENDRA KUMAR YADAV) ACCOUNTANT MEMBER JUDICIAL MEMBE R MUMBAI: DATED 19/08/2016 TRUE COPY S.K.SINHA / COPY OF ORDER FORWARDED TO:- 1. / REVENUE 2. / DECEASED ASSESSEE 3. ! / CONCERNED CIT 4. !- $%&' / CIT (A) 5. )*+& ,--, $%&' $, / / DR, ITAT, MUMBAI 6. +12 34' / GUARD FILE. BY ORDER / 5 , 6%/8 % &, $%&' $, / 9