Sandeep Rasiklal Shah, Pune V. DCIT, Central Circle-1(1), Pune

ITA 372/PUN/2013

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 0230 (ITAT-PUNE)
• Duration Of Justice: 3 year(s) 10 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-12-2016
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Next Hearing Date: 30-11-2016
• Assessment Year: 2007-2008
• Appeal Filed On: 06-02-2013
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: ANIL CHAWARE
• Assessee Lawyers: RISHI V LODHA
• Keywords: Search and seizure; Loose papers; Principle of natural justice; Opportunity of cross examination; Documents seized
• Section: 153A; 69; 132

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, PUN E . . , , ' , $ % BEFORE SHRI R.K. PANDA, AM AND SHRI VIKAS AWASTHY, JM . / ITA NOS. 372 & 373/PUN/2013 $' ' / ASSESSMENT YEARS : 2007-08 & 2008-09 SANDEEP RASIKLAL SHAH, OFFICE NO. 4, P.J. CHAMBERS, PIMPRI, PUNE 411018 PAN : AABCM2635D ....... / APPELLANT /VS. DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE 1(1), PUNE / RESPONDENT ASSESSEE BY : SHRI NARESH KUMAR & SHRI RISHI V. LODHA REVENUE BY : SHRI ANIL CHAWARE / DATE OF HEARING : 01-12-2016 / DATE OF PRONOUNCEMENT : 30-12-2016 / ORDER PER VIKAS AWASTHY, JM : THESE TWO APPEALS BY THE ASSESSEE ARE DIRECTED AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS)-I, PUNE DATED 19.11.2012, COMMON FOR THE ASSESSMENT YEARS 2007-2008 AND 2008-2009. 2. THE ASSESSEE IN APPEALS HAS ASSAILED THE FINDING OF TH E COMMISSIONER OF INCOME TAX (APPEALS) IN CONFIRMING THE ADDITIONS OF RS.1,00,000/-( IN ASSESSMENT YEAR 2007-2008) AND RS. 23.5 L AKHS ( IN 2 ITA NO. 372/PUN/2013 & 373/PUN/2013 A.Y. 2007-08 & 2008-2009 ASSESSMENT YEAR 2008-2009) ON THE BASIS OF STATEMENT O F ONE SHRI DHARMENDRA T. WADHWANI 3. THE BRIEF FACTS OF THE CASE AS EMANATING FROM THE RECO RDS ARE: A SEARCH ACTION U/S 132 OF THE INCOME TAX ACT, 1961 (HERE INAFTER REFERRED TO AS THE ACT) WAS CONDUCTED IN THE CASE OF ASSESSE E ON 13.08.2008. ON THE SAME DATE SEARCH AND SEIZURE ACTION WAS ALSO CA RRIED OUT IN THE CASE OF WADHWANI GROUP. IN THE CASE OF SEARCH ACTION AT THE PLACE OF ASSESSEE, NO INCRIMINATING DOCUMENT WAS FOUND. WHEREAS, I N THE CASE OF SEARCH ON WADHWANI GROUP SOME DOCUMENTS WERE SEIZED . IN ONE OF THE DOCUMENT IN BUNDLE NO.1 SEIZED FROM THE BEDROOM OF SH RI DHARMENDRA T WADHWANI, THERE WAS REFERENCE OF PAYMENT O F RS. 1,00,000/- MADE TO ASSESSEE ON 05.03.2007 I.E IN THE PERIOD RELEVANT TO ASSESSMENT YEAR 2007-2008. ANOTHER POCKET DIARY (PART OF BUNDLE NO.11) SEIZED DURING SEARCH AT THE PREMISES OF WADHWANI GROUP REFLECTED THAT A SUM OF RS. 23.5 LAKHS WAS RECEIVED BY DH ARMENDRA T WADHWANI FROM ASSESSEE. THE STATEMENT OF DHARMENDRA T W ADHWANI WAS RECORDED. IN HIS STATEMENT HE ADMITTED TO HAVE BUS INESS TRANSACTIONS WITH THE ASSESSEE. ON THE CONTRARY, DURING ASSESSMENT PROCEEDINGS THE ASSESSEE COMPLETELY DENIED OF HAVING ANY BUSINESS CONCERN WITH DHARMENDRA T WADHWANI. THE ASSESSEE STAT ED THAT THERE ARE NO CORRESPONDING ENTRY IN THE BOOKS OF ASSESSEE, AS HAS BEEN FOUND IN THE DOCUMENTS SEIZED DURING SEARCH OPERATION FROM THE PREMISES OF WADHWANI GROUP. HOWEVER, THE ASSESSING OFFICER REJECTED T HE CONTENTION OF THE ASSESSEE AND MADE ADDITION OF RS.1,00,000 /- IN THE INCOME RETURNED BY THE ASSESSEE FOR ASSESSMENT YEAR 2 007-2008 AND RS. 23.5 LAKHS U/S 69 C OF THE ACT IN THE ASSESSMENT YE AR 2008-2009. AGGRIEVED BY THE ADDITION MADE DURING ASSESSMENT PROCEE DINGS, THE 3 ITA NO. 372/PUN/2013 & 373/PUN/2013 A.Y. 2007-08 & 2008-2009 ASSESSEE FILED APPEAL BEFORE COMMISSIONER OF INCOME TAX (AP PEALS). THE COMMISSIONER OF INCOME TAX (APPEALS) REJECTED THE CONTENT IONS OF ASSESSEE AND UPHELD THE ADDITION. NOW THE ASSESSEE IS IN SECOND APPEAL BEFORE THE TRIBUNAL AGAINST THE ORDER OF COMMISSIONER OF I NCOME TAX (APPEALS), FOR THE ASSESSMENT YEARS 2007-2008 AND 2008-2009. 4. SHRI SHRI NARESH KUMAR & SHRI RISHI V. LODHA APPEARING ON BEHALF OF THE ASSESSEE SUBMITTED AT THE OUTSET THAT IN T HE GROUND NO.2 OF THE APPEAL, THE ASSESSEE HAS CHALLENGED ASSESSMENT FRAMED BY INVOKING THE PROVISION OF SEC. 153A OF THE ACT. THE ASSESSE E IS NOT PRESSING GROUND NO.2. THE ASSESSEE IS PRESSING ONLY GRO UND NO.1 RELATING TO THE ADDITION CONFIRMED BY THE COMMISSIONER OF I NCOME TAX (APPEALS). THE LD. A.R CONTENDED THAT THE ASSESSEE IS NOT HAVING ANY BUSINESS CONNECTION WITH DHARMENDRA T WADHWANI . THE DIARIE S THAT WERE SEIZED DURING SEARCH OPERATION AT THE PREMISES OF WADHWANI GROUP DOES NOT PERTAIN TO THE BUSINESS OF ASSESSEE. TH E LD. A.R POINTED THAT A PERUSAL OF RELEVANT EXTRACT OF THE DIARIES REPRODUCED IN ASSESSMENT ORDER FOR ASSESSMENT YEARS 2007-2008 AND 2008-2009 SHOW SOME JOURNAL ENTRIES PERTAINING TO ASSESSMENT YEAR UNDER CONSIDERATION. ONE ENTRY RELATES TO THE ASSESSEE FOR PA YMENT OF RS. 1,00,000/- IN THE ASSESSMENT YEAR 2007-2008 AND ANO THER FOR RS. 23.5 LAKHS INDICATING THAT THE SAID AMOUNT HAS BEEN PAID BY ASSESSEE DURING ASSESSMENT YEAR 2008-2009 TO DHARMEN DRA T WADHWANI. THE ADDITION HAS BEEN MADE IN RESPECT OF BOTH THE ENTRIES ON THE BASIS OF STATEMENT OF DHARMENDRA T. WADHWANI RECO RDED DURING SEARCH PROCEEDING. AT THE FIRST APPELLATE STAGE, THE ASSESSEE VIDE LETTER DATED 28.08.2012 ADDRESSED TO THE COMMISSION ER OF INCOME TAX (APPEALS) SOUGHT OPPORTUNITY TO CROSS EXAMINE THE 4 ITA NO. 372/PUN/2013 & 373/PUN/2013 A.Y. 2007-08 & 2008-2009 ORIGINATOR/OWNER OF THE POCKET DIARY SEIZED DURING SEARCH . HOWEVER, THE SAID APPLICATION OF THE ASSESSEE WAS REJECTED BY THE COMMISSIONER OF INCOME TAX (APPEALS). THUS, NO OPPORTUNITY OF HEARING WA S AFFORDED TO THE ASSESSEE TO CROSS EXAMINE DHARMENDRA T WADHWA NI ON THE BASIS OF WHOSE STATEMENT ADDITIONS WERE MADE IN THE HAND S OF THE ASSESSEE. THE LD. A.R CONTENDED THAT PRINCIPLES OF NATUR AL JUSTICE HAVE BEEN VIOLATED BY DENYING OPPORTUNITY OF CROSS EXAMINING T HE PERSON ON WHOSE STATEMENT THE ADDITIONS HAVE BEEN MADE. TO BUTT RESSES HIS SUBMISSIONS THE LD. A.R HAS PLACED RELIANCE ON THE DECISIO N OF THE HONBLE SUPREME COURT OF INDIA IN CIVIL APPEAL NO. 4228 OF 2006 IN THE CASE OF M/S ANDAMAN TIMBER INDUSTRIES V/S. COMMISSIONER OF CENTRA L EXCISE, KOLKATA DECIDED ON 02.09.2015 [ REPORTED AS 231 CTR 241(SC)] . THE LD. A.R FURTHER SUBMITTED THAT NO ADDITION U/S 153A OF THE ACT CAN BE MADE MERELY ON THE BASIS OF ANY DOCUMENT RECOVERED DURING SEARCH FROM THE THIRD PARTY. IN SUPPORT OF HIS CONTENTION THE LD. A.R PLACED RELIANCE ON THE DECISION OF THE HONBLE SUPREME COURT OF I NDIA IN THE CASES OF CENTRAL BUREAU OF INVESTIGATION V/S. V.C SHUKLA REPORTED A S (1998) 3SCC 410 AND PRADEEP AMRUTLAL RUNAWAL V/S. TAX REC OVERY OFFICER REPORTED AS 149 ITD 548 ( PUNE). 5. ON THE OTHER HAND, SHRI ANIL CHAWARE REPRESENTING THE DEPARTMENT VEHEMENTLY DEFENDED THE FINDINGS OF COMMISSION ER OF INCOME TAX (APPEALS) IN CONFIRMING THE ADDITION. THE LD. D.R SUB MITTED THAT DURING THE COURSE OF SEARCH IN CASE OF WADHWANI GR OUP, INCRIMINATING DOCUMENTS WERE FOUND INDICATING BUSINESS CONN ECTION OF THE ASSESSEE WITH NARESH T WADHWANI, BROTHER OF SHRI DH ARMENDRA T WADHWANI AND M/S SAI SAMARTH CONSTRUCTION (WHEREIN ONE OF THE PARTNER IS NARESH T WADHWANI). 5 ITA NO. 372/PUN/2013 & 373/PUN/2013 A.Y. 2007-08 & 2008-2009 6. WE HAVE HEARD THE RIVAL SUBMISSIONS AND HAVE PERUSED THE ORDERS OF THE AUTHORITIES BELOW. WE HAVE ALSO CONSIDERED T HE DECISIONS ON WHICH THE LD. A.R HAS PLACED RELIANCE IN SUPPORT OF HIS CO NTENTIONS. THE ADDITIONS HAVE BEEN MADE IN THE HAND OF THE ASSESSE E IN THE ASSESSMENT YEAR 2007-2008 FOR RECEIPT OF RS.1,00,000/- AND IN THE ASSESSMENT YEAR 2008-2009 FOR PAYMENT OF RS.23.5 LAKHS BASED ON ENTRIES IN THE DIARIES SEIZED DURING SEARCH OPERATION IN T HE CASE OF WADHWANI GROUP. THE STAND OF THE DEPARTMENT IS THAT DHA RMENDRA T WADHWANI IN HIS STATEMENT RECORDED DURING SEARCH ACTION HAS ADMITTED THAT THERE WERE BUSINESS TRANSACTIONS WITH THE ASSESSE E. THE LD. A.R HAS POINTED THAT THE ASSESSEE WAS NOT AFFORDED OPPORTU NITY TO CROSS EXAMINE DHARMENDRA T WADHWANI WHOSE STATEMENT WAS CR UCIAL FOR MAKING ADDITION IN THE HAND OF ASSESSEE. WE FOUND THAT THE ASSESSEE HAD MADE APPLICATION ON 28.08.2012(PLACED ON RECORD AT PAG E NO. 93 AND 94 OF THE PAPER BOOK) SEEKING OPPORTUNITY TO CROSS EXAMINE DHARMENDRA T WADHWANI. OSTENSIBLY, OPPORTUNITY OF CROSS EXAMINATION IS NOT AFFORDED TO THE ASSESSEE. IN ABSENCE O F OPPORTUNITY OF CROSS EXAMINATION OF DHARMENDRA T WADHWANI WHOSE ST ATEMENT WAS VITAL FOR MAKING ADDITION, WE ARE OF THE VIEW THAT THE A SSESSEE HAS BEEN DEPRIVED OF BASIC PRINCIPLE OF NATURAL JUSTICE. 7. THE HONBLE APEX COURT IN THE CASE OF M/S ANDAMAN TIMB ER INDUSTRIES V/S. COMMISSIONER OF CENTRAL EXCISE, KOLKATA (SUP RA) UNDER SIMILAR CIRCUMSTANCES, HELD THAT WHERE OPPORTUNITY OF CROSS EXAMINATION OF THE WITNESS HAS BEEN DENIED BY THE ADJUDIC ATING AUTHORITY AND THE STATEMENT OF THOSE WITNESSES WERE MA DE THE BASIS OF IMPUGNED ORDER, IT IS A SERIOUS FLAW WHICH MAKES THE ORDER NULLITY. THE RELEVANT EXTRACT OF THE JUDGMENT IS AS UNDER:- 6 ITA NO. 372/PUN/2013 & 373/PUN/2013 A.Y. 2007-08 & 2008-2009 ACCORDING TO US, NOT ALLOWING THE ASSESSEE TO CROSS EXAMINE THE WITNESSES BY THE ADJUDICATING AUTHORITY THOUGH THE STATEMENTS OF THOSE WITNESSES WERE MADE THE BASIS OF THE IMPUGNED ORDER IS A SERIOUS FLAW WHICH MAKES THE ORDER NULLITY INASMUCH AS IT AMOUNTED TO VIOLATION OF PRINCIPLES OF NATURAL JUST ICE BECAUSE OF WHICH THE ASSESSEE WAS ADVERSELY AFFECTED. IT IS TO BE BORNE IN MIND THAT THE ORDER OF THE COMMISSIONER WAS BASED U PON THE STATEMENTS GIVEN BY THE AFORESAID TWO WITNESSES. EV EN WHEN THE ASSESSEE DISPUTED THE CORRECTNESS OF THE STATEMENTS AND WANTED TO CROSS-EXAMINE, THE ADJUDICATING AUTHORITY DID NO T GRANT THIS OPPORTUNITY TO THE ASSESSEE. IT WOULD BE PERTINENT TO NOTE THAT IN THE IMPUGNED ORDER PASSED BY THE ADJUDICATING AUTHO RITY HE HAS SPECIFICALLY MENTIONED THAT SUCH AN OPPORTUNITY WAS SOUGHT BY THE ASSESSEE. HOWEVER, NO SUCH OPPORTUNITY WAS GRANTED AND THE AFORESAID PLEA IS NOT EVEN DEALT WITH BY THE ADJUDI CATING AUTHORITY. AS FAR AS THE TRIBUNAL IS CONCERNED, WE FIND THAT REJECTION OF THIS PLEA IS TOTALLY UNTENABLE. THE TR IBUNAL HAS SIMPLY STATED THAT CROSS EXAMINATION OF THE SAID DEALERS C OULD NOT HAVE BROUGHT OUT ANY MATERIAL WHICH WOULD NOT BE IN POSS ESSION OF THE APPELLANT THEMSELVES TO EXPLAIN AS TO WHY THEIR EX- FACTORY PRICES REMAIN STATIC. IT WAS NOT FOR THE TRIBUNAL TO HAVE GUESS WORK AS TO FOR WHAT PURPOSES THE APPELLANT WANTED TO CROSS-EXA MINE THOSE DEALERS AND WHAT EXTRACTION THE APPELLANT WANTED FR OM THEM. AS MENTIONED ABOVE, THE APPELLANT HAD CONTESTED THE TRUTHFULNESS OF THE STATEMENTS OF THESE TWO WITNESS ES AND WANTED TO DISCREDIT THEIR TESTIMONY FOR WHICH PURPOSE IT W ANTED TO AVAIL THE OPPORTUNITY OF CROSS-EXAMINATION. THAT APART, T HE ADJUDICATING AUTHORITY SIMPLY RELIED UPON THE PRICE LIST AS MAIN TAINED AT THE DEPOT TO DETERMINE THE PRICE FOR THE PURPOSE OF LEV Y OF EXCISE DUTY. WHETHER THE GOODS WERE, IN FACT, SOLD TO THE SAID D EALERS/ WITNESSES AT THE PRICE WHICH IS MENTIONED IN THE PR ICE LIST ITSELF COULD BE THE SUBJECT MATTER OF CROSS-EXAMINATION. T HEREFORE, IT WAS NOT FOR THE ADJUDICATING AUTHORITY TO PRESUPPOSE AS TO WHAT COULD BE THE SUBJECT MATTER OF THE CROSS EXAMINATION AND MAKE THE REMARKS AS MENTIONED ABOVE. WE MAY ALSO POINT OUT T HAT ON AN EARLIER OCCASION WHEN THE MATTER CAME BEFORE THIS C OURT IN CIVIL APPEAL NO.2216 OF 2000, ORDER DATED 17.03.2005 WAS PASSED REMITTING THE CASE BACK TO THE TRIBUNAL WITH THE DI RECTIONS TO DECIDE THE APPEAL ON MERITS GIVING ITS REASONS FOR ACCEPTING OR REJECTING THE SUBMISSIONS. IN VIEW OF ABOVE, WE ARE OF THE OPINION THAT IF THE TESTIMONY OF THESE TWO WITNESSES IS DISCREDITED, THERE WAS NO MATERIAL WITH THE DEPARTMENT ON THE BASIS OF WHICH IT COULD JUSTI FY ITS ACTION, AS THE STATEMENT OF THE AFORESAID TWO WITNESSES WAS TH E ONLY BASIS OF ISSUING THE SHOW CAUSE. WE, THUS, SET ASIDE THE IMPUGNED ORDER AS PASSED BY THE TRIBUNAL AND ALLOW THIS APPEAL. (EMPHASIS ADDED BY US) 7 ITA NO. 372/PUN/2013 & 373/PUN/2013 A.Y. 2007-08 & 2008-2009 THUS, IN VIEW OF THE FACTS OF THE CASE AND THE DECISIONS O F THE HONBLE SUPREME COURT OF INDIA, THE IMPUGNED ORDER IS LIABLE TO BE SET ASIDE ON THIS GROUND ALONE. 8. IT IS ALSO CONTENDED THAT DURING SEARCH PROCEEDING IN THE CASE OF ASSESSEE NO INCRIMINATING DOCUMENT WAS FOUND. THE ADDITION IS MADE ONLY ON THE BASIS OF DIARIES PURPORTED TO BE INCRIMINATING DOCUMENT FOUND AT THE PREMISES OF THIRD PARTY I.E. WADHWANI GROUP. TH E DEPARTMENT HAS FAILED TO ESTABLISH BUSINESS NEXUS BETWE EN WADHWANI GROUP AND ASSESSEE. EXCEPT FOR THE ENTRY IN THE DIARY R ECOVERED FROM THE BEDROOM OF DHARMENDRA T. WADHWANI AND STATEMENT OF DHARMENDRA T WADHWANI, THERE IS NO OTHER DOCUMENT ON RECORD TO SHOW THE BUSINESS CONNECTION BETWEEN WADHWANI GROUP AN D THE ASSESSEE. THE COMMISSIONER OF INCOME TAX (APPEALS) IN HIS O RDER HAS HELD THAT SOME OF THE DOCUMENTS FURNISHED BEFORE HIM SHO WS THAT THE ASSESSEE IS HAVING BUSINESS CONNECTION WITH NARESH T WADH WANI, BROTHER OF DHARMENDRA T WADHWANI. HOWEVER, WE FIND THAT TH ERE IS NO STATEMENT OF NARESH T WADHWANI SUPPORTING THE CASE OF D EPARTMENT. WE HAVE EARLIER POINTED THAT NO INCRIMINATING DOCUMENT W AS FOUND DURING SEARCH IN THE CASE OF ASSESSEE WHICH COULD SHOW T HAT THE ASSESSEE IS HAVING BUSINESS CONNECTION WITH WADHWANI GROUP. 9. THE CO-ORDINATE BENCH OF THE TRIBUNAL IN THE CASE OF P RADEEP AMRUTLAL RUNAWAL V/S. TAX RECOVERY OFFICER HAS DELETED THE ADDITION UNDER SIMILAR CIRCUMSTANCES. IN THE SAID CASE ADDITION WA S SOLELY MADE ON THE BASIS OF DOCUMENTS SEIZED FROM THE PREMISES OF THIR D PARTY. THE TRIBUNAL AFTER CONSIDERING CATENA OF JUDGMENTS HELD AS UNDER: 5.3 ACCORDING TO US, THE ADDITIONS MADE BY THE ASSE SSING OFFICER WERE NOT JUSTIFIED IN THE FACTS AND CIRCUMS TANCES VIS--VIS OF THE ASSESSEE. AS DISCUSSED EARLIER, DURING THE C OURSE OF SEARCH 8 ITA NO. 372/PUN/2013 & 373/PUN/2013 A.Y. 2007-08 & 2008-2009 IN THE CASE OF DHARIWAL GROUP, THE ONLY DOCUMENTS F OUND ON THE BASIS OF WHICH THE ADDITION U/S69A HAS BEEN MADE IN THE CASE OF THE ASSESSEE ARE IN THE FORM OF TWO LOOSE PAPERS WH EREIN AMOUNTS OF ? 4.80 CRORES AND? 30 LACS WERE NOTED AGAINST TH E NAME MR. PRADEEP RUNWAL. APART FROM THIS, NO EVIDENCE HAS B EEN FOUND TO SUGGEST THAT THE ASSESSEE HAD ACTUALLY RECEIVED THE SAID AMOUNT OR THAT THE ASSESSEE HAD ENTERED INTO ANY TRANSACTI ON WITH DHARIWAL GROUP. THERE IS NO EVIDENCE ON RECORD TO S UGGEST THAT THE ASSESSEE HAS PREVIOUS BUSINESS RELATIONS WITH T HE DHARIWAL GROUP. IN THE ABSENCE OF ANY DOCUMENTARY EVIDENCE T O SUGGEST THE SAME, IT COULD NOT BE PRESUMED THAT THE AMOUNTS REF LECTED IN THE LOOSE PAPERS WERE THE INCOME OF THE ASSESSEE RECEIV ED FROM DHARIWAL GROUP. IT HAS BEEN THE CONSISTENT STAND OF THE ASSESSEE THAT THERE MAY BE MANY PERSONS OF THE NAME OF PRADE EP RUNWAL IN PUNE AND THERE WAS NO SPECIFIC EVIDENCE TO SUGGE ST THAT THE SAID NOTHINGS PERTAINED TO THE ASSESSEE. HENCE, IT WAS NOT JUSTIFIED AS TO HOW, IN THE ABSENCE OF ANY OTHER CO RROBORATIVE DETAILS, THE ASSESSING OFFICER HAS ASSUMED THAT THE AMOUNTS REFLECTED THE INCOME OF THE ASSESSEE HIMSELF, WHILE THE ASSESSEE HAS NO BUSINESS DEALINGS OF HIS WITH DHARIWAL GROUP . THE ASSESSING OFFICER HAS NOT BROUGHT ON RECORD ANY EVI DENCE TO SUGGEST THAT DHARIWAL GROUP HAS ADMITTED THAT THE A MOUNTS WERE PAID TO THE ASSESSEE. HENCE, SIMPLY BECAUSE THE NAM E OF THE ASSESSEE IS NOTED ON THE SEIZED PAPERS DOES NOT MEA N THAT THE ADDITION COULD BE MADE IN THE HANDS OF THE ASSESSEE . SINCE NO EVIDENCE WAS FOUND RELATING TO THE EXISTENCE OF ANY TRANSACTION BETWEEN THE ASSESSEE AND DHARIWAL GROUP AND IN THE ABSENCE OF ANY CORROBORATIVE EVIDENCE TO SUGGEST THAT THE ASSE SSEE HAD ACTUALLY RECEIVED THE SAID AMOUNT, NO ADDITION COUL D BE MADE MERELY ON THE BASIS OF NOTING IN LOOSE PAPERS FOUND DURING THE SEARCH PROCEEDINGS IN THE CASE OF DHARIWAL GROUP AG AINST THE NAME OF THE ASSESSEE. 5.4 THE PRESUMPTION U/S 132(4A) IS AVAILABLE ONLY I N RESPECT OF THE PERSON FROM WHOM THE PAPER IS SEIZED. IT COULD NOT BE APPLIED AGAINST A THIRD PARTY AND HENCE, NO ADDITION COULD BE MADE ON THE BASIS OF THE EVIDENCE FOUND WITH THIRD PARTY. THE P RESUMPTION U/S 132(4A) COULD BE USED ONLY AGAINST THE PERSON FROM WHOSE PREMISES THE DOCUMENTS ARE FOUND AND NOT AGAINST TH E PERSON WHOSE NAME APPEARS IN THE SEIZED PAPERS. 10. THUS, IN VIEW OF THE FACTS AND CIRCUMSTANCES OF THE CAS E AND THE DECISIONS DISCUSSED ABOVE, WE ARE OF THE CONSIDERED VIEW T HAT ADDITIONS MADE DURING THE ASSESSMENT YEARS 2007-2008 AND 2008- 2009 SOLELY ON THE BASIS OF DIARIES SEIZED DURING SEARCH IN THE CASE OF WA DHWANI GROUP ARE NOT SUSTAINABLE IN THE HANDS OF ASSESSEE. ACCO RDINGLY, GROUND NO. 1 RAISED IN THE APPEALS FOR ASSESSMENT YEARS 2007-2008 9 ITA NO. 372/PUN/2013 & 373/PUN/2013 A.Y. 2007-08 & 2008-2009 AND 2008-2009 ARE ALLOWED AND THE ADDITION OF RS. 1,00,000/ - IN ASSESSMENT YEAR 2007-2008 AND RS. 23.5 LAKHS IN ASSES SMENT YEAR 2008-2009 ARE DIRECTED TO BE DELETED. 11. THE LD. A.R HAS NOT PRESSED GROUND NO. 2 RAISED IN BOT H THE APPEALS. ACCORDINGLY, GROUND NO. 2 RAISED IN THE APPEALS FOR ASSESSM ENT YEARS 2007-2008 AND 2008-2009 ARE DISMISSED AS NOT PRESSED. 12. IN THE RESULT, THE APPEALS OF THE ASSESSEE ARE PARTL Y ALLOWED IN ABOVE SAID TERMS. ORDER PRONOUNCED ON FRIDAY, THE 30 TH DAY OF DECEMBER, 2016. SD/- SS SD/- ( . . / R.K. PANDA) ( ! ' / VIKAS AWASTHY) ' / ACCOUNTANT MEMBER $% ' / JUDICIAL MEMBER / PUNE; & / DATED : 30 TH DECEMBER, 2016 SB + ,$.' /' / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT. 2. / THE RESPONDENT. 3. ' () / THE CIT(A)-I, PUNE 4. ' / THE CIT (CENTRAL), PUNE 5. ! %%, , , , A / , / DR, ITAT, BENCH, PUNE. 6. 2 / GUARD FILE. // TRUE COPY // / / BY ORDER, % , / PRIVATE SECRETARY, , , / ITAT, PUNE