ITO, CHITTORGARH V. Shri Madan Lal Samar, CHITTORGARH

ITA 391/JODH/2014

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 82979 (ITAT-JODHPUR)
• Duration Of Justice: 2 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-09-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 04-09-2014
• Assessment Year: 2010-2011
• Appeal Filed On: 30-06-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Unexplained investment; Salary income; Principle of natural justice; Corroborative evidences; Bonafide mistake
• Section: 143(3); 142(1); 69

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL , JODHPUR BENCH: JODHPUR (BEFORE SHRI HARI OM MARATHA, JUDICIAL MEMBER AND SHRI N.K. SAINI, ACCOUNTANT MEMBER) IT A NO. 391 /JODH/201 4 ASSTT. YEAR 2010 - 11 THE I.T. O VS SHRI MADAN LAL SAMAR WARD - 2 S/O. SH. MOHAN LAL SAMAR CHITTORGARH 124, MAIN ROAD, DOONGLA, BARI SADARI, CHITTORGARH. PAN : AE EPS 0812 C C.O.NO.17/JODH/2014 (A/O ITA NO. 391/JODH/2014) SHRI MADAN LAL SAMAR VS. THE I.T.O S/O. SH. MOHAN LAL SAMAR WARD - 2 124, MAIN ROAD, DOONGLA, CHITTORGARH BARI SADARI, CHITTORGARH. PAN NO. AEEPS 0812 C (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI SANDEEP JHANWAR DEPARTMENT BY : SHRI MAHESH KUMAR - D.R. DATE OF HEARING : 04/09 /2014 DATE OF PRONOUNCEMENT : 23 /0 9 /2014 O R D E R HARI OM MARATHA, J.M. TH E APPEAL BY THE REVENUE AND CROSS - OBJECTION (CO) BY THE ASSESSEE ARE DIRECT ED AGAINST THE ORDER OF LD. CIT (A) DATED 29.04.2014 PASSED FOR A.Y. 2010 - 11. 2 2. BRIEFLY STATED , THE FACTS OF THE CASE ARE THAT THE ASSESSEE, AS INDIVIDUAL, FILED HIS RETURN OF INCOME (ROI) FOR A.Y. 2010 - 11 ON 09.07.2010 DECLARING TOTAL INCOME OF RS. 2,09,828/ - . THE ASSESSEE DERIVED HIS INCOME FROM SALARY. ON THE BASIS OF AIR INFORMATION THAT HE HAS DEPOSITED CASH TOTALING TO RS. 34,24,100/ - IN HIS SAVING BANK ACCOUNT IN ICICI BANK DURING THE RELEVANT ACCOUNTING YEAR, REGULAR ASSESS MENT PROCEEDING WAS INITIATED. FURTHER, DURING THE ASSESSMENT PROCEEDINGS , IT WAS NOTICED THAT HUGE CASH DEPOSITS WERE MADE BY THIS ASSESSEE IN THE S.B. ACCOUNT OPENED WITH SBBJ, DUNGLA, CHITTORGARH. THE ASSESSEE WAS REQUIRED TO EXPLA IN THE SOURCE(S) OF TH IS DEPOSIT . T HE A.O. HAS COMP LETED ASSESSMENT ORDER AS UNDER: TOTAL INCOME AS PER ROI RS.2,09,828/ - ADD.: - I. UNEXPLAINED CASH DEPOSITS/CREDIT IN BANK ACCOUNTS U/S 69/OF THE I.T.ACT.1961 (AS PER PARA - 3 ABOVE ) 58,01,673/ - II. UNDISCLOSED INTEREST INCOME (AS PER PARA - 4 ABOVE) RS. 4,441/ - TOTAL TAXABLE INCOME RS. 60,15,942/ - ROUNDED OFF 60,15,940 2.1 AGGRIEVED, THE ASSESSEE PREFERRED APPEAL AND L D. CIT(A), AFTER CALLING FOR REMAND REPORT (R.R.) FROM THE A.O. HAS DELETED ADDITION OF RS.57,79,673/ - AND HAS SUSTAINED ON RS. 22,000/ - . THE REVENUE HAS CHALLENGED THE DELETION OF RS. 57,79,673/ - AND THE ASSESSEE HAS NOT 3 CHALLENGED THE SUSTAINED AMOUNT OF RS.22,000/ - . THE REVENUE HAS RAISED THE FOLLOWI NG GROUND IN ITS APPEAL: - ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE LD. CIT(A) HAS ERRED IN DELETING TH E ADDITION OF RS. 57,79,673/ - O N ACCOUNT OF UNEXPLAINED INVESTMENT/CASH DEPOSITS U/S 69 OF THE ACT WITHOUT APPRECIATING THE FACT THAT THE ASSESSEE HAS FAILED TO EXPLAIN THE SOURCE OF THE SAID INVESTMENT/CASH DEPOSITS IN THE ASSESSEES BANK ACCOUNTS. THE ASSESSEE HAS RAISED FOLLOWING GROUND IN THE CO: - 1(I) THE LD. CIT(A) ERRED IN LAW AND ON FACTS IN HOLDING THAT THE INVESTMENT BUSINESS ACTIVITY BELONGED TO ASSESSEE AND NOT TO HIS SON SHRI NILESH SAMAR (II) THE LD. CIT(A) ERRED IN LAW AND ON FACTS IN TREATING THE COMMISSION INCOME OF RS. 1,49,530/ - DECLARED BY SHRI NILESH SAMAR SON OF THE ASSESSEE AS INCOME OF THE ASSESSEE. 2. 2 WE HAVE HEARD RIVAL SUBMISSIONS. BOTH PARTIES HAVE REITERATED THEIR EARLIER ARGUMENTS, THE MAIN PLANK OF L D. DRS ARGUMENT IS THAT THE ASSESSEE HAS FAILED TO EXPLAIN THE SOURCE OF INVESTMENTS/DEPOSITS IN THE AFOREMEN TIONED BANK ACCOUNTS. WHEREAS, L D. AR HAS SUPPORTED THE FINDING OF L D. CIT(A) AND HAS STATED THAT, IN FACT THE ENTIRE ADDITION 4 MADE BY A.O. STANDS FULLY EXPLAINED AND THAT DURING THE REMAND PROCEEDINGS THE A.O. HAS VERIFIED EACH AND EVERY ASPECT OF THE MATTER INCLUDING THE SOURCE(S) OF DEPOSI TS. 2.3 AFTER COGITATING RIVAL STANDS VIS - - VIS THE OBTAIN IN G FACTS ON RECORD WE HAVE FOUND THAT THE LD. CIT(A) HAS CORRECTLY DELETED THE IMPUGNED ADDITION AS THE DEPOSITS TO THAT EXTENT FULLY STAND EXPLAINED. WE HAVE GONE THROUGH THE WRITTEN SUBMISSION A S WELL AS THE VOLUM I NOUS PAPER - BOOK. IT WOULD BE WORTHWHILE TO REPRODUCE THE WRITTEN SUBMISSION (W.S) OF THE ASSESSEE WHICH WAS VETTED BY THE A.O. DURING REMAND PROCEEDINGS. THE WRITTEN SUBMISSION S OF THE ASSESSEE READS AS UNDER: - IN THE ABOVE CASE THE ASSESSEE HAS FILED THE RETURN OF INCOME TO DECLARING SALARY INCOME OF RS. 2 , 09 , 828/ - BUT THE LEARNED ITO HAS ASSESSED INCOME AT RS. 60, 15,942/ - BY ADDING TOTALLY INCORRECT. THE ADDITION HAS BEEN MADE BY THE ITO IS WITHOUT ANY CONCRETE BASIS, IN THIS RESPE CT ON BEHALF OF THE ASSESSEE WE SUBMIT AS UNDER: - 1. THAT WE WANT TO BRING THE FACTS OF THE CASE THAT THE S.S. MARKETING COMPANY/HYDERABAD & ROYAL FOREX FUND OPENED A WEBSITE AND OFFER THE GENERAL PUBLIC TO JOIN THE COMPANY AND ALSO GIVEN SOME FALSE ASSURAN CE SAYING 5 THAT HIS COMPANY WILL PROVIDE GREAT INCOME IN SHAPE OF COMMISSION AND THE INTEREST, IF THEY INVEST THE MONEY BY PURCHASING THE STOCK AND PRODUCT OF THEIR COMPANY AND ALSO ASSURE THAT IF ANY MEMBER DEPOSIT THE AMOUNT IN THE COMPANY THEY WILL GET T HE 1% INTEREST ON THE AMOUNT DEPOSITED BY THEM AND ALL SERVICES WILL BE CARRIED OUT THROUGH ONLINE SYSTEM. 2. FURTHER WE WANT TO BRING THE FACTS THAT ASSESSEE'S SON SHRI NILESH SAMAR IS ENGAGED AS MEMBER IN INVESTMENT ACTIVITY FOR S.S. MARKETING, HYDERABAD A ND ROYAL FOREX FUND, HYDERABAD FROM THE MONTH OF SEPTEMBER 2009/ - TO DEPOSIT RS 10000/ - ACCORDING TO THE CONDITION FRAMED BY THE COMPANY. 3. IT IS CLEAR THAT SHRI NILESH SAMAR S/O SHRI MADAN LAL SAMAR IS OWNER / AGENT OF THIS WHOLE BUSINESS. FOR PROOF ONLINE DOCUMENTS AND STATEMENT OF COMMISSION RECEIVED BY SHRI NILESH SAMAR IS ENCLOSED FOR YOUR KIND VERIFICATION. IN SCHEME FRAMED BY THE COMPA NY VARIOUS PERSONS HAS DEPOSITED MONEY THROUGH ASSESSEE'S BANK A/C FOR INVESTMENT IN ABOVE COMPANIES. THE COMPANY ACCEPT THE DEPOSIT FROM E - PAYMENT ONLY AND BECAUSE THEY HAVE NO BANK A/C OR ONLINE TRANSFER FACILITIES. THE CHIT FUND COMPANY S.S. MARKETING . HYDRABAD HAS COLLECTED MONEY THROUGH ONLY BY BANK A/C. THESE PERSONS WHO HAVE INVESTED ARE NOT HAVING ONLINE BANK A/C IN ICICI BANK VILLAGE CHITTORGARH. THE ASSESSEE HAVE THE ONLINE FACILITY IN BOTH BANKS ICICI AND SBBJ 6 THEREFORE VARIOUS PERSONS IN GOOD FAITH DEPOSITED CASH IN BANK A/C AND TRANSFER THE SAME INTO CHIT FUND COMPANY'S BANK A/C. CHIT FUND COMPANY GONE AWAY AND NO INFORMATION OF THE COMPANY ARE AVAILABLE NOW DATE. ALL THE MONEY INVESTED / DEPOSITED IN THE COMPANIES ARE BECOME BAD AND NON RECOV ERABLE. THE VARIOUS INVESTORS HAVE FILED APPEAL WITH CMO GOVT, OF ANDHRA PRADESH, HYDERABAD. THESE FACTS AND RELATED PAPERS ARE WITH THE DEPARTMENT AT THE TIME OF ASSESSMENT PROCEEDINGS. THEREAFTER THEY HAVE ADDED THE HUGE AMOUNT TREATING THE ASSESSEE'S DE POSITS IN BANK A/C. THE AMOUNT OF CASH RECEIVED FROM VARIOUS PARTIES TOWARDS INVESTMENT IN COMPANIES CANNOT BE TREATED AS UNEXPLAINED CASH DEPOSIT / INVESTMENT OF THE ASSESSEE. FOR PROOF COMPLAINED LODGED IS ENCLOSED FOR YOUR KIND REFERENCE. 4. THAT THE LEAR NED ITO HAS WRONGLY ASSESSED THE INCOME IN ASSESSEE NAME INSTEAD OF ASSESSEE'S SON NILESH SAMAR. NILESH HAS USED ASSESSEE'S BANK A/C WITHOUT ASSESSEE'S KNOWLEDGE. IN PROOF ASSESSEE IS SUBMITTING THE DOCUMENTS (S.S. FOREX MEMBER LOGIN) IN WHICH NAME OF NILE SH IS THERE. HE IS ONLY A MEMBER OF THE COMPANY ASSESSEE IS NOT MEMBER OF COMPANY. NILESH HAS ALSO RECEIVED THE COMMISSION FROM THE COMPANY WHEREAS ASSESSEES HAVE NOT RECEIVED ANY COMMISSION FROM THE COMPANY IN ASSESSEE'S NAME. WHEN ASSESSEE HAVE NOT RECEI VED THE COMMISSION FROM THE COMPANY THEN HOW ITO HAS TREATED THESE CREDITS / DEPOSITS IN 7 ASSESSEE'S BANK A/C BELONG TO ASSESSEE. THE ITO HAS NOT INQUIRED THE REAL OWNER OF THE COMPANY MEMBER WHICH WAS NECESSARY TO FIND OUT FOR COMMISSION INCOME ALSO. THE M EMBER OF THE COMPANY RECEIVED INCENTIVE BINARY INCOME AND RECURRING INCOME OF WHICH STATEMENT AND AFFIDAVIT OF NILESH IS ENCLOSED OF NILESH. 5. THE ASSESSEE IS AN EMPLOYEE AND FILLING THE INCOME TAX RETURN OF ONLY SALARY INCOME. THERE ARE NO SUCH ASSETS OR AN Y OTHER BUSINESS ACTIVITY FROM WHICH IT CAN BE SAID THAT THE ASSESSEE HAS EARNED A SUM OF RS. 5801673/ - FROM UNDISCLOSED SOURCES. WHICH DETAILS ARE AS UNDER AS PER ASSESSMENT ORDER PASSED BY THE A.O: A - B 5,801,673 THE ADDITION MADE IN THE DECLARED INCOME OF RS. 58, 01,673/ - WHICH IS NOT CORRECT AS PER LAW. LEA RNED AO HAS ADDED INVESTMENT MA DE IN FDRS OF RS. 56791/ - WHICH IS NOT CORRECT BECAUSE IT IS SWEEP TRANSFER WHICH WAS PREPARED BY BANK AUTOMATICALLY DEBITING ASSESSEE BANK A/C AS PER SYSTEM AND NOT CASH DEPOSITED BY THE ASSESSEE SR. NO. NAME OF BANK AMOUNT 1 DEPOSITED IN ICICI BANK 4,508,2 19 19 2 DEPOSITED IN SBBJ BANK 1,905,325 3 INVESTMENT IN FDR 56,791 TOTAL A 6470335 SR. NO. PARTICULARS 1 SALARY INCOME 298,050 2 SWEEP TRF 370,612 TOTAL B 668,662 8 AND ALL FDRS AND STDRS A/C NO. AND AMOUNT NARRATED IN THE ASSESSMENT ORDER IS NOT APPEARING IN THE BANK A/C. HENCE IT IS WRONGLY ADDED IN THE INCOME TO CONSIDER AS CASH DEPOSITED BY THE ASSESSEE WITH FDRS PREPARED BY THE ASSESSEE. HENCE ADDITION MADE ON A/C OF STDRS IN SBB] BANK OF RS 56791/ - SHOULD BE DELETED. 6. IT IS ALSO VERY CLEAR THAT WHAT SO EVER AMOUNT WAS COLLECTED OR DEPOSITED IN BANK ACCOUNT OF THE ASSESSEE AND BANK ACCOUNT OF THE SON HAS BEEN TRANSFERRED TO THE COMPANY. THE ASSESSEE'S HAS COLLECTED THE MONEY IN CASH/CHEQUE FROM VARIOUS INVESTORS/ UNSECU RED LOAN / SELF SAVING AND HAD DEPOSITED IN COMPANY ACCOUNT SAME TIME. THEREFORE IT IS NOT AS THE ASSESSEE WAS WORKING ON BEHALF OF THE COMPANY FOR WHICH HE WAS GETTING THE COMMISSION INCOME. THEREFORE THERE IS NO SCOPE FOR MAKING ANY ADDITION U/S 69 OF I.T. ACT. HOWEVER WE ARE SUBMITTING DETAILS WITH DOCUMENTARY EVIDENCE PROOF THAT MONEY DEPOSITED IN BOTH BANK A/C ARE FROM SALARY INCOME INTEREST AND INCOME ON S.B. A/C, SWEEP ACCOUNT TRF, CAR LOAN RECEIPTS, AMOUNT RECEIVED DUE TO FDR MATURITY, AMOUNT RECEIVED DUE TO LIC MATURITY & AMOUNT RECEIVED DUE TO NSC MATURITY, DEPOSITED BY VARIOUS MEMBER BY CHEQUE /CASH ON DIFFERENT DATE WHICH COPY OF CONFIRMATION LETTER, UNSECURED LOAN BY CHEQUE WHICH COPY OF CONFIRMAT ION AND HIS BANK A/C STATEMENTS , CONTRA ENT RY IN BETWEEN BOTH BANKS& CANCELLED CHEQUE TRANSACTION WHICH EACH ARE SHOWN AS UNDER ANNEXURE SHEET ENCLOSED 9 SEPARATELY FOR YOUR KIND VERIFICATION. THE SUMMARIES OF TRANSACTION WITH AMOUNT WISE ARE AS UNDER: - SUMMARY OF TOTAL DEPOSITS IN BANK ACCOUNTS TOTA L DEPOSITS IN BANK ACCOUNT INCLUDING CASH AND CHEQUES AND OTHERS: 64,11,785/ - S. NO. NAME OF BANK AMOUNT 1. ICICI BANK 4516277 2. SBBJ BANK 1,895,508 3. INVESTMENT IN FDR NO FDR MADE IN CASH SR. NO. AMOUNT RECEIVED FROM/ON NO. AMOUNT 1 SALARY INCOME 1 298,050 2 SWEEP A/C TRF II 324,702 3 CAR LOAN III 255,574 4 FDR MATURITY IV 45,910 5 POST OFFICE NSC V 32,017 6 LIC REFUND VI 65,422 7 LOAN FROM NILESH SAMAR VII 469,491 8 LOAN FROM PUSHPA SAMAR VIII 67,428 9 LOAN FROM KHUSHBOO SAMAR IX 50,000 10 CONTRA ENTRY X 145,000 11 INTEREST XI 4,441 12 INCOME TAX REFUND XII 3,150 13 CANCELLED CHEQUE XIII 20,000 14 CASH WITHDRAW FROM ICICI BANK XIV 215,000 1 5 CASH WITHDRAW FROM SBBJ BANK XV 76,500 16 SUSPENCE 22000 17 CHEQUE DEPOSITS BY VARIOUS INVESTORS AS PER LIST ENCLOSED XVI 547,500 18 CASH DEPOSIT BY VARIOUS INVESTORS AS PER LIST ENCLOSED XVII 3,463,000 19 SELF DEPOSIT - A.) FROM OPENING CASH BALANCE(225000 - 94000) 131,000 B) S E LF SAVING OF THE ASSESSEE 175,600 10 IN SUPPORT OF ABOVE ANNEXURE I TO XVII OF AMOUNT RECEIVED ARE SUBMITTING WITH AIL DOCUMENTARY EVIDENCES AS LIKE SALARY CERTIFICATE, BANK CAR LOAN ACCOUNT STATEMENT FROM BANK, FDR MATURITY, NSC MATURITY, LIC MATURITY AMOUNT, AND UNSECURED LOAN DULY WITH CONFIRMATION AND BANK STATEMENT, BANK STATEMENT FOR CONTRA ENTRY AND CASH WITHDRAWALS AND CANCELLED CHEQUE AND THE ASSESSEE HAS TAKEN CASH DEPOSIT BY VARIOUS PERSON AS INVESTOR TO ONLINE TRANSFER IN BANK ACCOUNT OF THE COMPANIES WHICH PROOF LETTER OF CONFIRMATION DULY ATTESTED BY THE NOTARY WITH BANK STATEMENTS ARE ENCLOSED FOR YOUR KIND VERIFICATION. ASSESSEE HAS COMPLETED 30 YEARS OF HIS GOVERNMENT SERVICE AND AT PRESENT WORKING RESIDENCE AT DUNGLA AND OUT OF SERVICE S AVING HAS BEEN ALSO CASH DEPOSITED OF RS. 175600/ - IN THE BANK A/C. THE LEARNED I TO HAS BEEN MADE ALLEGATION IN THE ASSESSMENT ORDER WHICH IS NOT CORRECT OUR REPLY IS AS UNDER: - THAT AGRICULTURE LAND IS ANCESTRAL PROPERTY HENCE BELONG TO MY HUF. OUR EACH DEPOSITOR HAS NOT FILED COMPLAINED/F IR AGAINST S.S. MARKETING BECAUSE AMOUNT WAS PETTY AND LITIGATION EXPENSES IS MORE. 11 ASSESSEE HAS PRODUCE HIS CASH BOOK, BANK BOOK TO LEARNED AO AT THE TIME OF HEARING AND IN WHICH ABOVE MENTIONED ALL TRANSACTION HAS BEE N RECORDED IN THE BOOKS BUT AO HAS NOT CONSIDERED THE RECEIPTS RECORDED IN THE BOOKS FROM VARIOUS PERSONS AND ADDED TOTAL CASH /CHEQUE INTO BANK A/C AS RECEIPTS OF THE ASSESSEE WHICH IS NOT CORRECT. FOR PROOF CERTIFIED COPY OF CASH BOOKS IS PRODUCED BEFORE LEARNED A.O. IS SUBMITTING FOR YOUR KIND VERIFICATION. DURING THE YEAR UNDER CONSIDERATION ASSESSEE'S SON NILESH SAMAR WAS BECOME THE MEMBER OF THE COMPANY AND HE WAS REQUIRED TO OPERATE A BANK ACCOUNT THROUGH WHICH THE FUNDS SO COLLECTED WERE TO BE DEP OSITED AND REMITTED TO THE COMPANY BY INTERNET ONLINE SYSTEM. FOR UNDER TAKING SUCH JOB THREE TYPES OF COMMISSION PROVIDED TO THE MEMBERS OF THE COMPANY AND COMMISSION WAS REMITTED TO THE COMPANY THROUGH THE BANK. THERE ARRANGEMENT WAS MADE ON ONLINE SYSTE M AND ON MUTUAL FAITH AND THE ASSESSEE'S SON HAS DONE THIS WORK ONLY FROM SEPTEMBER 2009 TO 31 ST MARCH 2010. 7. THAT THE LEARNED ITO HAS NOT PROVIDED THE ADEQUATE TIME AS REQUESTED BY THE ASSESSEE FOR COLLECTION THE REMAINING CONFIRMATION OF INVESTOR AND FOR FURTHER REPLY. ANY ORDER PASSED WITHOUT GIVING REASONABLE OPPORTUNITY VIOLETS' THE PROVISION AND ALSO THE PRINCIPAL OF NATURAL JUSTICE. 1974 96ITR 148 12 8. DURING THE YEAR IN TWO BANKS A/C, ICICI BANK AND STATE BANK OF BIKANER & JAIPUR, CASH AND CHEQUE HAS BEEN DEPOSITED OF RS. 5801673/ - AFTER DEDUCTION OF OTHER DEPOSITS. THESE AMOUNTS WAS DEPOSITED B Y THE VARIOUS PERSONS UNDER THE SCHEME FRAMED BY THE COMPA NY IN ASSESSEE'S BANK A/C ON BEHALF OF THE COMPANY AND FULL AMOUNT WAS TRANSFERRED TO COMPANY'S BANK A/C AS PER PROCEDURE FRAMED BY THE COMPANY. MONEY RECEIVED FROM VARIOUS PARTIES TOWARDS INVESTMENT SCHEME CANNOT BE TREATED ASSESSEE'S UNEXPLAINED MONEY U/ S 69 OF I. T. ACT. IT WAS NOT ASSESSEE'S INVESTMENT BUT IT WAS INVESTMENT OF VARIOUS PERSONS WHO WERE INVESTED IN COMPANY SCHEME. THE SECTION 69 OF INCOME TAX ACT IS READ AS UNDER: - 'THE ASSESSEE HAS MADE INVESTMENT WHICH IS NOT RECORDED IN THE HOOKS OF AC COUNTS IF ANY MAINTAINED BY HIM FOR ANY SOURCE OF INCOME & THE ASSESSEE OFFERS NO EXPLANATION ABOUT THE NATURE & SOURCE OF INVESTMENTS OR THE OFFERED BY HIM IS NOT IN THE OPINION OF THE A.O., SATISFACTORY. THE VALUE OF INVESTMENT MAY BE DEEMED TO BE THE IN COME OF THE ASSESSEE OF SUCH FINANCIAL YEAR.' THE MAIN CONDITION OF U/S 69 IS AS UNDER. - I. ASSESSEE HAS MADE INVESTMENT WHICH WAS NOT RECORDED IN THE BOOKS. 13 II. ASSESSEE HAS EXPLAINED THE SOURCE WHICH WAS NOT SATISFACTORY IN THE OPINION OF A.O. IN OUR CASE ASSESSEE HAS REPLIED AT THE TIME OF ASSESSMENT PROCEEDINGS THAT CASH DEPOSITED INTO BANK A/C ARE RECEIVED FROM CUSTOMERS TO TAKE FDR WITH S. S. MARKETING CO, HYDERABAD & ROYAL FOREX FUND, AND HYDERABAD. ASSESSEE HAS PRODUCE CASH BOOK & CONFIRMATION LETTER OF VARIOUS DEPOSITORS, WHICH IS PLACE ON RECORD. THERE IS NO SUCH INSTANCE WHERE WE ACCEPT THAT A.O. IS NOT SATISFY WITH OUR REPLY & EVIDENCE SUBMITTED BEFORE HIM. HENCE ADDITION MADE U/S 69 OF I.T. ACT IF TOTALLY INCORRECT AS PER LAW . IN THIS CASE MADAN LA L SAMAR IS NOT A MEMBER OF THE COMPANY THEREFORE NO INCOME OF COMMISSION FROM THE COMPANY REFLECTS IN ASSESSEE'S BANK A/C AND ITO HAS ALSO NOT ASSESSED COMMISSION INCOME AFTER VERIFYING THE BANK ACCOUNT SUBMITTED TO HIM AT THE TIME O F ASSESSMENT PROCEEDINGS. 9. THAT A. O. HAS NOT ACCUMULATED SUFFICIENT EVIDENCE ON RECORD BEFORE MAKING AN ADDITION U/S 69 OF I.T. ACT. NON DEPOSITOR WAS EXAMINED BY THE ITO. EVEN AN INDEPENDENT INQUIRY WAS NOT CONDUCTED BY THE A.O. BEFORE MAKING SUCH HUGE ADDITION IN INCOME AND THE ASSESSEE DID NOT HAVE ANY OPPORTUNITY TO CROSS EXAMINE IF REQUIRED BY ITO. ITO HAS NOT MADE ANY COMMENT IT MEANS THEY HAVE ACCE PTED THE SAME. 14 10. THE ADDITION IN INCOME CANNOT BE MADE SIMPLY ON THE BASIS OF SELECTION FOR SCRUTIN Y THROUGH CASS WITHOUT MAKING ANY INDEPENDENT INQUIRES 11. I NCOME CANNOT BE MADE SIMPLY ON THE BASIS OF SUSPICION OF ANY ADVERSE MATERIAL ON RECORD AGAINST THE ASSESSEE. 12. MERE RECEIPT OF SAID AMOUNT IN BANK A/C DURING THE YEAR COULD NOT BE DESCRIBED AS INCOME OF THE ASSESSEE BECAUSE THESE AMOUNTS NEITHER LOAN NOR DEPOSIT THEN HOW IT WILL BE INVESTMENT IN ASSESSEE'S NAME IN THE EYE OF I.T. DEPARTMENT BECAUSE SAME AMOUNT HAS BEEN TRANSFERRED TO COMPANY ACCOUNT BY INTERNET. 13. THAT FOR MAKING ADDITION U/S 69 BURDEN LIES ON THE A.O. TO BRING THE POSITIVE MATERIAL AND EVIDENCE ON RECORD IN RESPECT OF UNEXPLAINED INVESTMENT / DEPOSIT BECAUSE ASSESSEE HAVE PRODUCE ALL THE RELEVAN T MATERIAL AND EVIDENCE FOR THE ITO AT THE TIME OF ASSESSMENT PROCEEDINGS. THEREFORE NO ADDITION IN THE TOTAL INCOME OF THE ASSESSEE CAN BE MADE U/S 69 OF I.T. ACT. 14. THAT THE LEARNED ITO HAS ADDED IN INCOME 5801673/ - WHILE FULLY AMOUNT HAS BEEN TRANSFERRED TO S. S. MARKETING IN THERE BANK ACCOUNT THEREAFTER ON PRESUMPTION A.O. HAS ADDED IN INCOME WHICH IS QUITE ILLEGAL AND AGAINST THE PRINCIPAL OF NATURE AND JUSTICE. THE PRESUMPTION OF A.O. CANNOT TAKE THE PLACE OF EVIDENCE FOR MAKING AN ADDITION IN INCOME. J 15 THAT THE LEARNED ITO HAS ASSESSED DEEMED & FICTITIOUS INCOME IN THIS CASE WHILE I.T.O. SHOULD ASSESS REAL AND ACTUAL INCOME IN THE NAME OF REAL PERSON. SHRI ASHOK SHARMA V/ S CIT1994 209ITR 679 (PART) 15. THE FOLLOWING DECISIONS ARE SUPPO RT TO MY VIEW STATED ABOVE: - INCOME TAX APPELLATE TRIBUNAL JAIPUR, ANITA KAUSHAL, JAIPUR V/S ITO (TAX REFERENCE VOL. 128 , ISSUE NO. 9 PG. 72) HELD: - 'ASSESSEE WAS COLLECTION AGENT AND COLLECTED MONEY ON BEHALF OF THE COMPANY AND TRANSFERRED MONEY BACK TO THE COMPANY. THE CASE DEPOSIT IN BANK ACCOUNT CANNOT BE ADDED TO ASSESSEE'S INCOME U/S 69 OF I.T ACT' I TAT J ODHPUR. ACIT. J ODHPUR V/S KEWAL CHAND DAKLIVA. J ODHPUR TAX WORLD VOL.41. 2009 PG. 41) HELD: CASH RECEIVED BY VARIOUS PARTIES WERE NOT DEPOSITS BUT RELATED TO TRANSACTION OF SHARE AND SECURITY. IT CANNOT BE TREATED AS UNEXPLAINED CASH DEPOSIT. CIT V/S BHANWAR LAI MURWATIVA (H.C.) PAGE 214 TAX WORLD VOL. 39, 2008 (RAJ. HIGH COURT) WHETHER DEPARTMENT HAS TO BRING ON RECORD SUFFICIENT EVIDENCE BEFORE MAKING ANY ADDITION U/S 69 OF I.T. ACT. HELD: - YES 16 DCIT V/S ASHOK KUMAR J AIN ITAT (TAX WORLD VOL. 39. 2008 PG. 137) WHETHER ADDITION CAN BE MADE SIMPLY ON THE BASIS OF ADI REPORT WITHOUT MAKING ANY INDEPENDENT ENQUIRIES? HELD : - NO. ROHITASH YADAV V/S ITO (TAX WORLD VOL. 39.2008 PG. 87) HELD: - AN ADDITION CAN NOT BE MADE SIMPLY ON THE BASIS OF SUSPICION IN ABSENCE OF ANY ADVERSE MATERIAL ON RECORD AGAINST THE ASSESSEE. DHIRAJ LA L GIRDHARI LA L V/S CIT. CTR VOL. 26 736 (SC) 'ASSESSMENT BASED ON MERE CONJUNCTI ON SURMISES IRRELEVANT OBSERVATION IS INVALID AND UNSUSTAINABLE IN LAW.' TCN MENON V/S I.T.0.1974 96ITR 148 KER IT IS CLEAR FOR THE READING OF SEC 69 THAT BEFORE THE AMOUNT OF UNEXPLAINED INVESTMENT IS INCLUDED WITH TOTAL INCOME OF AN ASSESSEE; HE IS ENTIT LED TO AN OPPORTUNITY TO EXPLAIN. THE TAX CAN BE LEVIED BY I.T.O. ONLY ON ACTUAL OR NET INCOME AND NO TAX CAN BE LEVIED ON A DEEMED OR FICTIONAL INCOME. IN VIEW OF THE ABOVE FACTS AND LEGAL ASPECT KINDLY DELETE THE ADDITION OF RS. 58, 01,673/ - AND OBLIGE. 17 2 .4 THE PAPER - BOOK FILED BEFORE L D. CIT(A) CONTAINED CONFIRMATION, AFFIDAVITS BANK STATEMENTS OF VARIOUS DEPOSITOR ETC. T HE ENTIRE MATERIAL WAS FORWARDED TO A.O. VIDE LETTER DATED 20.01.2014, WHO AFTER EXAMIN IN G THE SAME SENT HIS REPORT DATED 27.03.2014 WHICH IS INCORPORATED IN THE IN APPELLATE ORDER IN PARA 2.3 AT PAGE 14. THIS REMAND RETURN READS AS UNDER: - 2.3 NOW, THE ITO HAS SENT HIS REPORT VIDE LETTER NO,1451 DATED 27TH MARCH,2014 WHI CH WAS RECEIVED IN THIS OFFICE ON 1ST APRIL,2014 BY FAX STATING AS UNDER: KINDLY REFER TO THE SUBJECT CITED ABOVE, IN THIS CONNECTION, IT IS VERY HUMBLY SUBMITTED THAT A REMAND REPORT IN THE CASE OF THE ABOVE REFERRED ASSESSEE WAS CALLED FOR BY YOUR HONOR TWO M ONTHS BACK. SIR, FIRST OF ALL I HIGHLY REGRET FOR INCONVENIENCES CAUSED TO YOUR KIND HONOUR FOR DELAY IN SUBMITTING REMAND REPORT IN THE ABOVE CASE WITHIN THE DESIRED TIME DUE TO THE REASON THAT THE UNDERSIGNED WAS CONSTRUED THE ADDL. CHARGE OF WARD - 2 CHI TTORGARH ON 25.02.2014. THE WARD INSPECTOR HAD ALREADY BEEN ON LONG LEAVE PRIOR TO CHARGE TAKEN BY THE UNDERSIGNED TO TILL DATE. THE CLERICAL STAFF HAS ALSO FORGETTING TO PUT UP THE LETTER OF YOUR GOOD OFFICE AND RECORD BEFORE ME. THIS MATTER CAME TO MY KN OWLEDGE ONLY AFTER TELEPHONIC DIRECTIONS RECEIVED FROM YOUR GOOD OFFICE. I AGAIN APOLOGIZE FOR THE DELAY IN 18 SUBMITTING THE DESIRED REMAND REPORT WELL WITHIN THE DESIRED TIME. BRIEF HISTORY OF CASE; - THE ASSESSEE IS AN INDIVIDUAL & IS AN EMPLOYEE OF AWNL AJ MER. HE IS PRESENTLY POSTED AT BARI SADRI. HE IS HAVING TAXABLE INCOME, HE FILED HIS RETURN OF INCOME IN INDIVIDUAL STATUS FOR THE YEAR UNDER ASSESSMENT 2010 - 11 IN FORM (ITR - 1) ON 09.07.2010, DECLARING TAXABLE INCOME FROM SALARY ONLY AT RS.2,09,230/ - . THE CASE WAS SELECTED UNDER SCRUTINY THROUGH CASS. THE BANK ACCOUNT STATEMENTS OF SBB&J & ICICI BANKS WERE FURNISHED IN COMPLIANCE TO NOTICE U/S 143(2). PERUSAL OF BANK STATEMENTS OF BOTH THE BANKS, IT WAS NOTICED THAT IN SPITE OF HAVING INTEREST INCOME FROM B ANKS AND INTEREST EARNED FROM FDRS, THE ASSESSEE HAS NOT DISCLOSED INTEREST INCOME IN THE RETURN OF INCOME FILED BY HIM. EVEN HE HAS NOT DISCLOSED THE INTEREST INCOME TO HIS EMPLOYER FOR TDS PURPOSES. AS PER AIR INFORMATION GENERATED ONLINE SHOWED THAT THE ASSESSEE HAS MADE CASH DEPOSITS IN HIS BANK ACCOUNTS MAINTAINED WITH ICICI BANK, AMOUNTING TO RS.32,24,100/ - AND IN SBB&J, AMOUNTING TO RS.6,37,000/ - . IT WAS FURTHER NOTICED THAT THE ASSESSEE HAS ALSO DEPOSITED BANKERS CHEQUES AMOUNTING TO RS.10,87,919/ - IN ICICI BANK & RS. 12,68,325/ - IN SBBJ ACCOUNT. THE HUGE CASH DEPOSITS AND OTHER DEPOSITED CLEARLY INDICATED THAT THE ASSESSEE WAS INVOLVED IN OTHER ACTIVITIES THAN THAT OF INCOME EARNED BY HIM FROM SALARY. 19 TO EXAMINE THE SOURCE OF DEPOSITS, VIDE THIS O FFICE QUERY NOS. 7 & 8 OF QUESTIONNAIRE DATED 02.08.2009, THE ASSESSEE WAS SPECIFICALLY ASKED TO EXPLAIN THE SOURCE OF DEPOSITS MADE IN CASH OR THROUGH BANKERS CHEQUES IN BOTH OF HIS BANK ACCOUNTS. THE COMPLIANCE OF SHOW CAUSE NOTICE WAS MADE VIDE WRITTEN SUBMISSION ON 26.11.2012. AS REGARDS SOURCE OF DEPOSITS IN SBB J , A/R OF THE ASSESSEE HAS SUBMITTED, WHICH IS REPRODUCED AS UNDER: SH. MADAN LAL SAMAR ENGAGED IN INVESTMENT ACTIVITIES FOR S.S. MARKETING HYDRABAD AND ROYAL FOREX FUND. AS REGARDS DEPOSITS M ADE IN ICICI BANK ACCOUNT, THE SOURCE OF ABOVE DEPOSITS HAS BEEN EXPLAINED, WHICH IS REPRODUCED AS UNDER: - VARIOUS PERSONS DEPOSITED MONEY THROUGH ASSESSEES BANK ACCOUNT FOR INVESTMENT IN ABOVE COMPANIES BECAUSE THEY HAVE NO BANK ACCOUNTS OR ONLINE TRANS FER FACILITIES. THE CHIT FUND COMPANIES COLLECT MONEY ONLY THROUGH BANK ACCOUNTS. THERE ARE VARIOUS PERSONS NOT HAVING ONLINE BANK ACCOUNTS IN ICICI BANK IN THE VILLAGE NEAR BY DUNGLA, BARI SADRI ETC. MR. SAMAR COLLECTED CASH FROM THE PERSONS IN GOOD FAITH & DEPOSITED THE SAME INTO THE CHIT - FUND COMPANIES BANK ACCOUNTS. THE CHIT FUND COMPANIES GONE AWAY AND NO INFORMATION REGARDING WHEREABOUTS OF THESE COMPANIES ARE AVAILABLE TILL DATE. ALL THE MONEY DEPOSITED/INVESTED IN THE COMPANIES ARE NOW BECOME BAD & NON RECOVERABLE. ASSESSEE AND VARIOUS INVESTORS APPEALED WITH THE CMO GOVT . OF ANDHRA PRADESH HYDERABAD (COPY IS ENCLOSED). 20 CONSIDERING THE REPLIES/EXPLANATIONS FURNISHED EARLIER BY THE ID. AIR. OF THE ASSESSEE, AN ANOTHER FRESH OPPORTUNITY OF BEING EXPL AINED WAS PROVIDED THROUGH ISSUING A FRESH SHOW CAUSE NOTICE ON THE VARIOUS ISSUES EMERGED AFTER CONSIDERING THE REPLIES EARLIER FILED BY THE ASSESSEE TO THE QUERIES. THE FINAL QUERIES WERE RAISED IN QUESTIONNAIRE DATED 13.12.2012 HAS ALREADY BEEN REPRODUC ED IN BODY OF ORDER PASSED U/S 143(3) DATED 16.01.2013. THE WRITTEN SUBMISSION FILED BY THE ASSESSEE BEFORE YOUR HONOR DURING THE APPELLATE PROCEEDINGS & ALLEGATION MADE AGAINST ADDITION MADE IN THE HANDS OF ASSESSEE BY THE THEN A.O THAT DUE TO WANT OF PRO PER OPPORTUNITY IN SUBMITTING SUPPORTING DOCUMENTARY EVIDENCES IN SUPPORT TO SOURCE OF DEPOSITS WERE LEFT TO PRODUCE DURING THE ASSESSMENT PROCEEDINGS. IN THE ABSENCE OF SUPPORTING EVIDENCES ADDITION WAS MADE BY THE THEN A.O, INVOKING PROVISIONS OF SECTION 69 OF THE I.T. ACT, 1961. THE COPY OF SAME HAS BEEN FORWARDED TO UNDERSIGNED BY YOUR HONOR TO EXAMINE THESE EVIDENCES, IT IS CONSIDERED NECESSARY TO HAVE COMMENTS/ REPORT ON THE ADMISSIBILITY AND MERIT ON SUCH EVIDENCES. FOR THIS PURPOSE ONE SET OF SUCH E VIDENCE ALONG WITH COPY OF WRITTEN SUBMISSION ARE BEING ENCLOSED. IN THIS REGARDS IT IS SUBMITTED THAT ONLY THE COPY OF WRITTEN SUBMISSION FILED BEFORE YOUR HONOR HAS BEEN FORWARDED TO THE UNDERSIGNED WITHOUT ANY EVIDENCES AS MENTIONED IN THE LETTER. THEREFORE EXAMINATION, ADMISSIBILITY AND MERITS OF EVIDENCE COULD NOT POSSIBLE IN ABSENCE OF SAME. HOWEVER PARA WISE COMMENTS OF UNDERSIGNED ON THE ISSUES ARISE BY THE ASSESSEE IN WRITTEN SUBMISSION ARE AS UNDER: - 21 COMMENTS/ EXP LANATION OF UNDERSIGNED ON PARA - 2 OF WRITTEN SUBMISSION FILED AS BELOW: - AS STATED IN WRITTEN SUBMISSION THAT ASSESSEES SON SHRI NILESH SAMAR IS AGENT/MEMBER OF COMPANIES AND ENGAGED IN INVESTMENT ACTIVITIES FOR S.S. MARKETING & ROYAL FOREX FUND, HYDERABA D FROM THE MONTH OF SEPTEMBER, 2009 BY DEPOSITING OF RS. 10,000/ - ACCORDING TO CONDITION FRAMED BY THE COMPANY? THE SUBMISSION OF THE ASSESSEE IS COMPLETELY FALSE AND WITHOUT ANY SUBSTANCE IN THE LIGHT OF FACTS NARRATED BELOW: - IN REPLY TO QUERY NO. 7 OF QU ESTIONNAIRE DATED 02.08.2009, THE ASSESSEE WAS ASKED TO EXPLAIN THE SOURCE OF DEPOSITS MADE IN BOTH OF HIS BANK ACCOUNTS. THE COMPLIANCE OF THIS QUERY WAS MADE ON 26.11.2012. THE REPLIES OF THE ASSESSEE, THE SOURCE OF DEPOSITS WERE MADE IN SBB&J ACCOUNT, T HE NR OF THE ASSESSEE HAS EXPLAINED IS REPRODUCED AS UNDER: SH. MADAN LAL SAMAR ENGAGED IN INVESTMENT ACTIVITY FOR S.S. MARKETING HYDRABAD AND ROYAL FOREX FUND. SINCE THE ASSESSEE HIMSELF ACCEPTED THIS FACT THAT THE ASSESSEE ENGAGED IN INVESTMENT ACTIVIT IES FOR S.S. MARKETING AND ROYAL FOREX FUND, HYDERABAD NOW IN WRITTEN SUBMISSION FILED BEFORE YOUR HONOR THE ASSESSEE HAS REVISED HIS OWN STATEMENTS STATING THAT HIS SON IS AGENT I MEMBER OF ABOVE COMPANIES AND ENGAGED IN COLLECTING MONEY FROM CUSTOMERS ON BEHALF OF ABOVE COMPANIES AND DEPOSITED IN BANK ACCOUNTS OF ASSESSEE (FATHER OF NILESH SAMAR) AND TRANSFERRED THE MONEY IN ABOVE COMPANIES BANK ACCOUNTS THROUGH ONLINE TRANSFER. THE SUBMISSION OF ASSESSEE ITSELF IS FOUND CONTRADICTORY AS IN ONE REPLY BEFO RE THE 22 AO HE SUBMITS THAT THE ASSESSEE IS ENGAGED IN INVESTMENT ACTIVITY FOR S.S. HYDERABAD AND ROYAL FOREX FUND AND ON THE OTHER HAND BEFORE YOUR GOODSELF THE ASSESSEE SUBMITS THAT HIS SON SHRI NILESH SAMAR IS AGENT I MEMBER OF ABOVE COMPANIES AND ENGAGED IN COLLECTING MONEY FROM CUSTOMERS ON BEHALF OF ABOVE COMPANIES AND DEPOSITED IN BANK ACCOUNTS OF ASSESSEE AND HAS TRANSFERRED THE MONEY IN ABOVE COMPANIES BANK ACCOUNTS THROUGH ONLINE TRANSFER. THE SUBMISSION PUT FORTH BY THE ASSESSEE BEFORE YOUR KIND HO NOUR APPEARS TO BE AN AFTERTHOUGHT WHICH HAS NO MEANING AND WITHOUT SUBSTANCE IN THE LIGHT OF FACTS PUT ON RECORD WHICH DISCUSSED AS UNDER. AS EXPLAINED IN WRITTEN SUBMISSION THAT FROM THE MONTH OF SEPTEMBER 2009, SHRI NILESH SAMAR (SON) OF THE ASSESSEE B ECAME AGENT/ MEMBER BY DEPOSITING RS. 10, 000/ - ACCORDING TO CONDITION FRAMED BY COMPANY. THE STATEMENTS OF THE ASSESSEE ARE ONCE AGAIN CONTRADICTORY. AS PER WRITTEN REPLY DATED 26.11.201 2, FILED IN RESPONSE TO Q.NO. 8. THE ASSESSEE HIMSELF EXPLAINED THAT T HE CHIT FUND COMPANIES COLLECT MONEY ONLY THROUGH BANK ACCOUNTS BY ONLINE TRANSFER. BUT AS EXPLAINED BY ASSESSEE THAT HIS SON NILESH SAMAR BECAME MEMBER BY DEPOSITING RS.10, 000/ - IN THE MONTH OF SEP, 2009. IT IS PERTINENT TO MENTION HERE THAT IN THE DETA ILS OF BOTH THE BANK ACCOU NT STATEMENTS FOR THE MONTH OF S EP T , 2009 THERE FOUND EVEN NOT A SINGLE ENTRY OF RS. 10,000/ - IN BANK ACCOUNT STATEMENTS SHOWING DEBITED TO THE ASSESSEE BY TRANSFER OR CASH. AS STATED BY THE ASSESSEE IN HIS EARLIER WRITTEN REPLY T HAT THE COMPANY HAS TAKEN AMOUNT THROUGH ONLINE TRANSFER AND HIS SON NILESH HAVE NO ONLINE FACILITY ON HIS BANK ACCOUNT, THEREFORE, IT IS INEVITABLE THAT SHRI NILESH SAMAR HAS 23 USED BANK ACCOUNT OF HIS FATHER. (SHRI MADAN LAL SAMAR). THE SUBMISSION OF THE A SSESSEE FILED BEFORE YOUR HONOR AGAIN SEEMS TO BE CONTRADICTORY & AFTER THOUGHT IN THE LIGHT OF FACTS. CONSIDERING ALL THE FACTS OF THE CASE I AM OF VIEW THAT EXPLANATION OF THE ASSESSEE HAVING NO FORCE THEREFORE NOT ACCEPTABLE. COMMENTS/ EXPLANATION OF UN DERSIGNED ON PARA - 3 OF WRITTEN SUBMISSION FILED AS BELOW: - AS EXPLAINED IN PARA 3 OF WRITTEN REPLY FILED BEFORE YOUR HONOR STATING THAT SHRI NILESH SAMAR (SON IF THE ASSESSEE) IS AUTHORIZED MEMBER OF ABOVE CHIT FUND COMPANIES INSTEAD OF THE ASSESSEE. IN SU PPORT THEREOF THE ASSESSEE HAD FURNISHED THE ONLINE GENERATED DOCUMENTARY EVIDENCES WHICH SHOWED, AS STATED BY THE ASSESSEE THAT COMMISSION WAS DISBURSED BY THE COMPANIES IN THE NAME OF SHRI NILESH SAMAR (SON IF THE ASSESSEE) IN SUPPORT TO DECLARE HIS SON AS REAL AGENT/ MEMBER OF ABOVE COMPANIES INSTEAD OF ASSESSEE (MADAN LAL SAMAR). IT IS PERTINENT TO MENTION HERE THAT ASSESSEE HAS NEVER DISCLOSED COMMISSION EARNED FROM ABOVE COMPANIES SINCE FILING OF RETURN TO THE DATE OF COMPLETION OF ASSESSMENT.. WHEN S HRI NILESH HAS NO ONLINE FACILITY ON HIS BANK ACCOUNT AND COMPANIES ARE MADE ALL DEBITS AND CREDIT TRANSACTIONS ONLY THROUGH ONLINE THEN IN WHICH BANK ACCOUNT THE RECEIPT OF SO CALLED COMMISSION CLAIMED TO HAVE BEEN RECEIVED BY SHRI NILESH SAMAR, HAS BEEN CREDITED? THE SUBMISSION OF THE ASSESSEE TOTALLY FALSE AND CONTRADICTORY TO THE EARLIER EXPLANATIONS GIVEN IN SUPPORT THEREOF WHICH INDICATES THAT THE ASSESSEE HAS TRYING TO SHIFT HIS RESPONSIBILITY BY WAY OF DECLARING HIS SON SHRI NILESH SAMAR AS AN AGENT / MEMBER OF THESE COMPANIES THROUGH FILING 24 MANAGED EVIDENCES WHICH CANNOT BE VERIFIABLE IN THE LIGHT OF EARLIER SUBMISSION/ EXPLANATIONS FILED BY THE ASSESSEE WHICH DISCUSSED AS UNDER: - IN REPLY TO Q. NO.7 DATED 26.11.2012, WHEREIN THE ASSE SSEE HIMSELF HA S ACCEPTED THAT MADAN LAL SAMAR IS ENGAGED IN INVESTMENT ACTIVITIES OF THE ABOVE COMPANIES BY COLLECTING CASH FROM THE PERSONS IN GOOD FAITH & DEPOSITED THE SAME INTO CHIT FUND COMPANYS BANK ACCOUNTS. THE REVISED EXPLANATION SUBMITTED BEFORE YOUR HONOR INDICATES THAT ASSESSEE WAS TRYING TO SHIFT HIS ULTIMATE RESPONSIBILITY BY FURNISHING FALSE EVIDENCES WHICH HAVE NO FORCE EXCEPT AFTERTHOUGHTS TO PREVENT HIM FROM CONCEALED INCOME WHICH HE HAS NOT DISCLOSED IN HIS RETURN OF INCOME. IN REPLY TO Q. NO. 2 ABO UT DETAILS OF DEPENDED FAMILY MEMBERS FURNISHED ON 26.11.2012, IT WAS SUBMITTED THAT THE ASSESSEES FAMILY CONSISTS OF FOUR MEMBERS, I.E. HIMSELF, WIFE, SON & DAUGHTER. AS STATED IN REPLY THAT MY SON IS EMPLOYEE OF YASH BIRLA GROUP MALKAPUR IN MAHARASHTRA STATE. IT IS PERTINENT TO MENTION HERE THAT HOW IT IS POSSIBLE WHEN A PERSON SERVING HIS DUTY IN MAHARASHTRA STATE AND IS ALSO CARRYING OUT BUSINESS AS AN AGENT AND COLLECTS THE MONEY FROM CUSTOMERS AND TRANSFERS THE MONEY ONLINE SPECIALLY WHEN HE HAVE NO ONLINE FACILITY ON HIS BANK ACCOUNT, THEREFORE TO TRANSFER THE AMOUNT BY USING BANK ACCOUNTS OF THE ASSESSEE (MADAN LAI SAMAR). BUT REASON ABOUT NOT GETTING ONLINE FACILITY ON HIS BANK ACCOUNT WAS DISCUSSED. 25 IN PARA 6(III) OF WRITTEN SUBMISSION FILED BEFO RE YOUR HONOR DURING THE APPELLATE PROCEEDING IS REPRODUCED AS UNDER: - THAT ASSESSEE HAS PRODUCED HIS CASH BOOK, BANK BOOK, TO LEARNED AO AT THE TIME OF HEARING AND IN WHICH ABOVE MENTIONED ALL TRANSACTIONS HAVE BEEN RECORDED IN THE BOOKS BUT AO HAS NOT C ONSIDERED THE RECEIPTS RECORDED IN THE BOOKS FROM VARIOUS PERSONS AND ADDED TOTAL I CHEQUES IN TO BANK ACCOUNT AS RECEIPT OF THE ASSESSEE WHICH IS NOT CORRECT. FOR PROOF CERTIFIED COPIES OF CASH BOOK FURNISHED BEFORE LEARNED AO IS SUBMITTING FOR KIND VERIF ICATION. THE WRITTEN SUBMISSION/ EXPLANATION GIVEN IN PARA - 2, 3 & 4 OF REPLY FILED BEFORE YOUR HONOR, IS REPRODUCED AS UNDER: - AS STATED THAT WE WANT TO BRING THE FACTS THAT ASSESSEES SON SHRI NILESH SAMAR IS ENGAGED AS MEMBER IN S.S. MARKETING AND ROY AL FOREX FUND HYDRABAD FROM THE MONTH OF SEPTEMBER,2009 BY DEPOSIT RS. 10,000/ - ACCORDING TO CONDITION FRAMED BY THE COMPANIES. IT IS CLEAR THAT SHRI NILESH SAMAR S/O MADAN LAL SAMAR IS AGENT/ OWNER OF WHOLE OF BUSINESS. IN PARA 4 ALLEGATIONS MADE AGAINST THE ACTION OF THE A.O THAT THE ITO HAS WRONGLY ASSESSED THE INCOME IN ASSESSEES NAME INSTEAD OF ASSESSEES SON NILESH SAMAR IT IS WORTHWHILE TO MENTION HERE T HAT IF THE ASSESSEE SHRI MADAN L AL SAMAR WAS NOT WORKING AS AN AGENT OF CHIT FUND COMPANIES AND WHOLE OF THE RECEIPTS DEPOSITED IN THE BANK ACCOUNTS OF THE ASSESSEE RELATES TO NILESH SAMAR THEN WHAT IS THE NECESSITY TO MAINTAIN/PREPARE CASH BOOK, BANK BOOK AND AS WHY THEY HAVE BEEN PRODU CED EVIDENCES BEFORE THE ITO. 26 IN VIEW OF FACTS AND CIRCUMSTANCES OF THE CASE DISCUSSED ABOVE. CONSIDERING THE WRITTEN SUBMISSIONS FURNISHED BEFORE THE A.O & THE REPLY FILED BEFORE YOUR HONOR IN THE LIGHT OF FACTS DISCUSSED ABOVE IN BRIEF ITSELF HAS SUFFICI ENT EVIDENCE TO PROVE THA T ONLY THE ASSESSEE SHRI MADAN L AL SAMAR IS AN AGENT OF S.S. MARKETING AND ROYAL FOREX FUND HYDRABAD AND TRYING TO MISGUIDE THE DEPARTMENTAL AUTHORITIES BY FILING FALSE EXPLANATIONS AND EVIDENCES AS THE EXPLANATION I EVIDENCES FUR NISHED EARLIER DURING THE ASSESSMENT PROCEEDING BEFORE THE A.O & THE WRITTEN REPLY FILED ALONG WITH EVIDENCES/ EXPLANATION BEFORE YOUR HONOR, ARE DIFFERENT. THEREFORE IT IS CRYSTAL CLEAR THAT REVISED EXPLANATION/CLARIFICATIONS SUBMITTED IN SUPPORT TO ADDIT IONS MADE IN THE HANDS OF ASSESSEE HAVING NO FORCE AND WITHOUT SUBSTANCE. COMMENTS/EXPLANATION OF UNDERSIGNED ON PARA - 4 OF WRITTEN SUBMISSION FILED AS BELOW: - AS ALLEGED IN THIS PARA THAT THE ITO HAS WRONGLY ASSESSED INCOME IN THE NAME OF ASSESSEE INSTEAD OF SON NILESH SAMAR HE IS MEMBER OF COMPANIES NOT THE ASSESSEE. THE ALLEGATION OF THE ASSESSEE IS BASELESS AND WITHOUT SUBSTANCE HAVING NO FORCE AS DISCUSSED IN PARA 1 & 2 ABOVE. COMMENTS/EXPLANATION OF UNDERSIGNED ON PARA - 7 OF WRITTEN SUBMISSION FILED AS BELOW: - AS ALLEGED IN PARA 7 THAT THE A.O HAD NOT PROVIDED ADEQUATE TIME FOR SUBMITTING EVIDENCES IN SUPPORT OF INVESTMENT BESIDE THE REQUEST OF ASSESSEE. THE ALLEGATION MADE BY THE 27 ASSESSEE TOTALLY FALSE AS MORE THAN SUFFICIENT OPPORTUNITIES HAVE BEEN AL LOWED TO THE ASSESSEE TO SUBMIT/ EXPLAIN THE SOURCE OF DEPOSITS AND TO FURNISH SUPPORTING DOCUMENTARY EVIDENCES. THE ASSESSEE WAS PROVIDED PROPER OPPORTUNITY TO REPRESENT HIS CASE. NOTICES U/S 143(2), 142(1) AND QUERY LETTER WERE ISSUED ON VARIOUS DATES. S O MANY OPPORTUNITIES, AS PER ORDER SHEET ENTRIES, HAVE ALREADY BEEN PROVIDED TO THE ASSESSEE BUT THE ASSESSEE HAS FAILED ON ALL THE OCCASIONS AND HAS BEEN SIMPLY FILING LETTERS SEEKING ADJOURNMENT/MORE TIME ON ONE PRETEXT OR THE OTHER. FIRST HEARING FIXED ON 12/09/2011 AND FINAL SHOW CAUSE ISSUED FIXING THE HEARING FOR 21/12/2012, IN BETWEEN MUCH TIME AVAILABLE FOR ASSESSEE TO PRODUCE PROPER DETAILS, PRECISED INFORMATION AND CONCRETE EVIDENCES IN SUPPORT HIS CONTENTION BUT THE ASSESSEE FAILED TO SUBMIT THE SAME. THE OPPORTUNITIES WERE PROVIDED ARE DISCUSSED IN BODY OF ORDER PASSED U/S 143(3) DATED 16.01.2013 THE ASSESSEE WAS CLEARLY ACKNOWLEDGED THAT THE SUBMISSION/CONTENTIONS IN HIS REPLY WERE NOT ACCEPTABLE AND IT APPEARED TO BE AN AFTERTHOUGHT/MADE UP STO RY IN AN ATTEMPT TO EXPLAIN THE UNDISCLOSED CASH DEPOSITS/CREDIT ENTRIES IN HIS BANK ACCOUNT. THE SO CALLED CASH BOOK AND BANK BOOK FURNISHED BY THE ASSESSEE ITSELF SUFFERS FROM SERIOUS DEFECTS AS STATED IN THE ASSESSMENT ORDER AND AS SUCH IN THE ABSENCE OF ANY SUPPORTING DOCUMENTARY EVIDENCES. THE ASSESSEE WAS GIVEN AN OPPORTUNITY TO SHOW CAUSE AS TO WHY THE CASH DEPOSITS/CREDITS ENTRIES IN HIS BANK ACCOUNT/INVESTMENTS AMOUNTING TO RS.58,01,676/ - I.E. (RS.64,70,335/ - MINUS SALARY OF RS.2,98,050/ - AND SWEEP FD IN SBBJ ACCOUNT OF RS.3,70,612/ - ) SHOULD NOT BE TREATED AS 28 UNEXPLAINED INVESTMENT/CASH DEPOSIT. BUT THE ASSESSEE WAS NEITHER RESPONDED NOR OPPOSED THE SAME; IT REFLECTS THE ASSESSEE WAS CONCURRED WITH THE DETERMINATION OF THE A.O. COMMENTS/E XPLANATION OF UNDERSIGNED ON PARA - 9 OF WRITTEN SUBMISSION FILED AS BELOW: - THE DETERMINATION OF A.O. WAS BASED ON FACTS AND CIRCUMSTANCES OF THE CASE AND CONSIDERING THE DETAILS AND DOCUMENTARY EVIDENCES AVAILABLE ON RECORD. THERE WAS SUFFICIENT EVIDENCE O N RECORD FOR MAKING THE ADDITION. COMMENTS/EXPLANATION OF UNDERSIGNED ON PARA - 10 OF WRITTEN SUBMISSION FILED AS BELOW: - THE SELECTION FOR SCRUTINY THROUGH CASS IS A COMPUTER ASSISTED SELECTION SYSTEM PROGRAM ON PARAMETERS DECIDED BY CBDT. THE A.O. HAS EMPOWERED TO COMPLETE SCRUTINY ASSESSMENT AND MAKING ADDITION, ACCORDINGLY. COMMENTS/EXPLANATION OF UNDERSIGNED ON PARA - 11 OF WRITTEN SUBMISSION FILED AS BELOW: - THE DETERMINATION OF A.O. WAS BASED ON FACTS AND CIRCUMSTANCES OF THE CASE AND CONSIDERING THE DETAILS AND DOCUMENTARY EVIDENCES AVAILABLE ON RECORD. THERE WAS SUFFICIENT EVIDENCE ON RECORD FOR MAKING THE ADDITION AND NOT MADE SIMPLY ON THE BASIS OF SUSPICION OF ANY MATERIAL. 29 COMMENTS/EXPLANATION OF UNDERSIGNED ON PARA - 12 OF WRITTEN SUBMISSION FILED AS BELOW: - THE ASSESSEE FAILED TO JUSTIFY OR ESTABLISH HIS CONTENTION. THE DETERMINATION OF A.O. WAS BASED ON FACTS AND CIRCUMSTANCES OF THE CASE AND CONSIDERING THE DETAILS AND DOCUMENTARY EVIDENCES AVAILABLE ON RECORD. COMMENTS/EXPLANATION OF UNDERSIGNE D ON PARA - 13 OF WRITTEN SUBMISSION FILED AS BELOW: - THE A.O. MADE THE ADDITION ON THE BASIS OF FACTS AND CIRCUMSTANCES OF THE CASE AND CONSIDERING THE DETAILS AND DOCUMENTARY EVIDENCES AVAILABLE ON RECORD. COMMENTS/EXPLANATION OF UNDERSIGNED ON PARA - 14 OF WRITTEN SUBMISSION FILED AS BELOW: - THE ASSESSEE FAILED TO JUSTIFY OR ESTABLISH HIS CONTENTION. THE DETERMINATION OF A.O. WAS BASED ON FACTS AND CIRCUMSTANCES OF THE CASE AND CONSIDERING THE DETAILS AND DOCUMENTARY EVIDENCES AVAILABLE ON RECORD. CONSIDERIN G ALL THE FACTS AND CIRCUMSTANCES OF THE CASE AND ON THE BASIS OF MATERIAL AVAILABLE ON RECORD, THE REPORT IS BEING SUBMITTED FOR YOUR KIND HONOURS PERUSA L. 30 2.5 ON THIS REPORT, THE ASSESSEE OBSERVED AND SUBMITTED AS UNDER: WITH REFERENCE TO REMAND REPORT DATED 27/03/2014, IN THIS RESPECT WE SUBMIT THAT THE LEARNED A.O. HAS MADE CERTAIN ALLEGATIONS IN THE REMAND REPORT WHICH ARE NOT CORRECT AND NOT BASED ON ANY CONCRETE EVIDENCES, A.O. HAS JUST MADE ROUTINE REPLY AND GIVEN SAME EXPLANATION AS MENTION ED IN THIS ASSESSMENT ORDER PASSED U/S 143(3) OF INCOME TAX ACT. THE A.O HAS NOT GIVEN ANY OPPORTUNITY BEFORE PREPARING & SENDING REMAND REPORT THEREFORE REMAND REPORT IS ILLEGAL IN THE EYE OF LAW. IN THIS RESPECT THE REPLY OF COMMENTS ARE AS UNDER: - I N TH IS RESPECT WE SUBMIT THAT SHRI NILESH SAMAR HAS MADE ONLINE PAYMENT OF RS. 10000/ - MEMBER SHIP FEES AND RS. 1000/ - AS E - REGISTRATION FEE'S ON 03/09/2009 TO M/S S. S. MARKETING AND ROYAL FOREX FUND, HYDERABAD. THE SAME TRANSACTION HAS BEEN APPEARING IN THE S.B.B.J. BANK A/C ON THAT DAY FOR PROO F OF COPY OF BANK A/C STATEMENT IS ENCLOSED FOR YOUR KIND VERIFICATION. FURTHER WE SUBMIT THAT A.O. HAS MADE ALLEGATION THE REPLY WAS MADE BY THE NR OF THE ASSESSEE ON 26/11/2012 IS THAT SHRI MADAN LAL SAMAR WAS E NGAGED IN THE INVESTMENT ACTIVITIES FOR S. S. MARKETING HYDERABAD AND ROYAL FOREX FUND IS NOT CORRECT I SUBMIT THAT REPLY WAS SIGNED BY ME DATED 26/11/2012 WHICH WAS PREPARED BY MY C.A , WHO HAVE NOT KNOWLEDGE OF FULL FACTS & CONTENT OF THIS CASE & BANK ENTRY & SIGNED BY ME WITHOUT READ OR UNDERSTAND THE CONTENT OF LETTER IN GOOD FAITH. IT WAS MY BONAFIDE MISTAKE 31 FURTHER WE SUBMIT THAT WHEN THIS MISTAKE COME TO MY KNOWLEDGE BEFORE YOUR HONOR I HAVE IMMEDIATELY RECTIFY THIS MISTAKE & FILED LETTER & AFFIDAV IT BY MY SON SHRI NILESH S AMER ON JUDICIAL STAMP & ATTESTED BY THE NOTARY TO STATE THAT I AM MEMBER OF M/S S.S. MARKETING & ROYAL F O REX FUND, H YD E RABAD NOT S HRI MADAL LAL SAMER THE ALLEGATION MADE BY THE A.O. IN THE REMAND REPORT TO STATE THAT SUBMISSION PUT FORTH BY THE ASSESSEE BEFORE YOUR KIND HONOR APPEARS TO BE AFTER THROUGH IS BASELESS & NO MEANING IN THE EYE OF LAW BECAUSE ALL E VIDENCE HAS BEEN SUBMITTED , E.G. CASH BOOK CONFIRMATION OF LETTER FROM INVESTORS I COPY OF BANK STATEMENT ARE AVAILABLE ON YOUR RECORD. 2. I T HAS ALREADY SUBMITTED THAT SHERI NILES SAMAR IS THE AUTHORIZED MEMBER OF THE ABOVE CHIT FUND COMPANIES AND IN SUPPORT OF OWNERSHIP HE HAS PRODUCE I EXPLAINED FOLLOWING EVIDENCE TO YOUR HONOUR: - HE HAD FURNISHED ONLINE GENERATED DOCUMENTA RY EVIDENCE AND ALL DOCUMENTS WHICH ARE APPEARING IN THE NAME OF (NILESH SAMAR) ARE APPEARING. HE HAD TAKEN AGENCY AFTER DEPOSITING RS. 10000/ - AS MEMBERSHIP FEES THROUGH BANK ACCOUNT HE HAD FILED HIS RETURN OF INCOME FOR THE ASSESSMENT YEAR 2010 - 11 TO DEC LARING COMMISSION INCOME FROM THE CHIT FUND COMPANY. HE HAD ALSO FILED AN AFFIDAVIT IN SUPPORT OF HIS OWNERSHIP. 32 HERE WE STRONGLY OBJECT THAT ASSESSING OFFICER NOT GIV EN ANY REPLY TO YOUR HONOR REGARDING EVIDENCE SUBMITTED BEFORE YOUR HONOR . THE A.O HAS SIMPLY MADE ALLEGATION IN REMAND REPORT WITHOUT ANY EVIDENCE. FURTHER ASSESSING OFFICER HAS MADE ALLEGATIONS THAT ASSESSEES WAS EMPLOYEE OF YASH BIRLA GROUP, MALKAPUR IN MAHARASHTRA STATE, THE ALLEGATION IS FALSE BECAUSE ASSESSEES SON WAS ENGAGED IN THE YASH BIRLA GROUP COMPANY IN THE ENGINEERING DEPARTMENT AS ELECTRICAL ENGINEER FROM W.E.F. 01/12/2011 TO 15/03/2013 WHICH PERIOD IS NOT PERTAINED TO OUR ASSESSMENT. IN OUR SUPPORT A COPY OF LETTER FROM THE YASH BIRLA GROUP DATED 15/03/2013 IS ENCLOSED FOR Y OUR KIND VERIFICATION. THE NILESH S AMER WAS IN SERVICE AT THE TIME OF SCRUTINY PERIOD NOT AT THE TIME OF ASSESSMENT PERIOD. ASSESSEE HAS SUBMITTED DETAIL OF AMOUNT DEPOSITED IN THE BANK ACCOUNT ON THE DIFFERENT DATE WHICH WAS RECEIVED ON FROM VARIOUS SOURC E , WHICH SOURCE LIKE SALARY INCOME , LIE MATURITY , UNSECURED LOANS , CAR LOAN , DEPOSIT BY VARIOUS PERSON FOR CHIT FUND CO BY CHEQUE OR CASH , FDR MATURITY , POST OFFICE NSC , CONTRA ENTRY , SWEEP ACCOUNT CANCELLED CHEQUE CASH WITHDRAWALS & SELF SAVING & ANNEXURE DETAILS HAS BEEN SUBMITTED WITH LAST REPLY TO YOUR HONOR. 33 WE HUMBLE SUBMIT TO YOUR HONOR THAT WHEN EACH SOURCE OF DEPOSIT IN BANK ACCOUNT HAS BEEN EXPLAINED WITH DOCUMENTARY EVIDENCE THAN HOW A.O. DETERMINING UNEXPLAINED INCOME OF THE ASSESSEE OF ALL CREDIT ENTRY OF BANK ACCOUNT & ADDED IN THE INCOME THE ASSESSEE HAS PRODUCED CASH BOOK, BANK BOOK TO A.O. AT THE TIME OF ASSESSMENT PROCEEDING FOR VERIFICATION THAT ALL TRANSACTIONS HAVE BEEN RECORDED IN THE BOOKS AND MONEY PERTAINED TO VARIOUS PERSON S & NOT BELONG TO THE ASSESSEE. THESE TRANSACTIONS WERE DONE THROUGH SHRI MADAN LAL SAMARS BANK ACCOUNT IT DOES NOT MEANS THAT THIS MONEY BELONGS TO SHRI MADAN LAL SAMER. SHRI MADAN LAL SAMAR IS EMPLOYEE OF THE A.V.V.N.L. AJMER AND HE HAS DECLARED INCOME FROM SALARY OF RS. 209230/ - . HERE WE AGAIN CLARIFYING THAT ASSESSEE'S SON SHRI NILESH SAMAR IS ENGAGED AS MEMBER IN S.S. MARKETING AND ROYAL FOREX FUND HYDERABAD FROM THE MONTH OF SEPTEMBER 2009 BY DEPOSITING 10000/ - ACCORDING TO CONDITION FRAMED BY THE CO MPANY . IT IS CRYSTAL CLEAR THAT SHRI NILESH SAMAR I S AGENT /OWNER OF THE WHOLE BUSINESS NOT SHRI MADAN LAL S AMER . THE EVIDENCES SUBMITTED BEFORE A.O. AND TO YOUR HONOR WHICH ARE SUFFICIENT EVIDENCE TO PROVE THAT ONLY SON OF ASSESSEE SHRI NILESH SAMAR IS AN AGENT OF THE S S MARKETING AND ROYAL FOREX FUND HYDERABAD BUT A 0 HAS NO COGENT EVIDENCES THAT NILESH SAMAR IS NO T OWNER OF THE CHIT FUND COMPANIES AND HE DOES NOT PROVE THAT ALL EVIDENCES SUBMITTED IN PROOF OF OWNERSHIP ARE 34 BOGUS AND FALSE, ONLY MADE ROUTINE ALLEGATION TO STATE THAT FILING FALSE EXPLANATION AND EVIDENCE FURNISHING TO TRY AND MISGUIDE THE DEPARTMENT WHICH IS NOT CORRECT 03. NO COMMENTS BECAUSE THIS MATTER IS ALREADY DISCUSSED IN THE ABOVE PARA 1 & 2 04. THE ASSESSEE HAS CLEARLY EXPLAINED THE CASH/CHEQUE DEPOSITED IN THE BANK ACCOUNT AND IN SUPPORT OF DEPOSIT HE HAS SUBMITTED DATE AND TRANSACTION WISE CASH BOOK, BANK BOOK TO THE ASSESSING OFFICER AT THE TIME OF ASSESSMENT PROCEEDING IN WHICH CASH DEPOSIT I CREDIT ENTRIES HAVE BEEN EXPLAINED BUT AT THE TIME OF ASSESSMENT PROCEEDING NEITHER HE HAS ASKED FOR SUPPORTING EVIDENCE NOR ANY INDEPENDENT ENQUIRY CONDUCTED FOR VERIFICATION OF THE CREDIT TRANSACTIONS AND ALL CASH DEPOSITS I CREDIT ENTRIES APPEARING THE BANK ACCOUNT RS. 5801676/ - ADDED IN THE TOTAL INCOME AS TREATED AS UNEXPLAINED INVESTMENTS/ CASH DEPOSIT WHICH IS NOT CORRECT BECAUSE REASONABLE TIM E WAS NOT ALLOWED TO THE ASSESSEE BEFORE MAKING AN ADDITION IN THE TOTAL INCOME. FURTHER, I HAVE REPLIED FULL EXPLANATION OF RS. 5801676/ - TO YOUR HONOR ALONG WITH ALL DOCUMENTARY EVIDENCES BUT A.O. HAS NO COMMENTS IN THE REMAND REPORT ON THIS EVIDENCE SUB MITTED BEFORE YOUR HONOR. FURTHER WE SUBMIT THAT IN THIS PERIOD CHIT FUND COMPANY M/S S.S. MARKETING AND ROYAL FOREX FUND HAS BEEN CLOSED HIS BUSINESS HIS OFFICE IS DOWN AND RUN AWAY TO UNKNOWN PLACE WITHOUT ANY INFORMATION. THEREFORE TIME WAS REQUIRED FOR COLLECTING ALL DOCUMENTS AND NECESSARY EVIDENCE WHICH WAS NOT GIVEN BY THE 35 A.O. AT THE TIME OF ASSESSMENT PROCEEDING. BEFORE ISSUE OF SHOW CAUSE ASSESSEE HAS PRODUCE CASH BOOK I BANK STATEMENT BEFORE A.O. FOR VERIFICATION & IN THE CASH BOOK CUSTOMER NAME W AS APPEARING WITH AMOUNT & DATE BUT BOTH THE I.T 0. HAS NOT ENQUIRED ABOUT THE DEPOSIT THE BANK BY THE VARIOUS PERSONS SO THESE AMOUNT ADDED IN INCOME ARE WITHOUT ANY EVIDENCE PROOF. SINCE ADDITION IN INCOME IS ILLEGAL. HERE BOTH THE I.T. 0 HAS NOT ASSESSE D REAL INCOME BUT ONLY FICTITIOUS INCOME 05. THE AMOUNT GIVEN BY THE PERSONS FOR INVESTMENT IN THE CHIT FUND COMPANY CANNOT BE INCOME OF THE ASSESSEE AT A L L . 6. THERE WAS NO SUFFICIENT MATERIAL WITH THE I.T.O. FOR MAKING THE ADDITION & IF FURTHER EVIDENCE IS REQUIRED, BOTH THE I.T.O. HAVE NOT GIVEN OPPOR TUN ITY TO THE ASSESSEE 7. THE CASE WAS SELECTED FOR SCRUTINY THROUGH CASS OF PARAMETERS DECIDED BY CBDT BUT A.O. HAS NOT EMPOWER TO ADD IN TOTAL INCOME WHATEVER INFORMATION RECEIVED THROUGH CASS TIL L WITHOUT VERIFICATION, BUT IN THIS CASE A.O. HAS MADE INCOME OF ALL DEPOSITED ENTRIES APPEARING IN BANK ACCOUNT HAS BEEN ADDED IN THE TOTAL INCOME WITHOUT ENQUIRED & GATHERING THE EVIDENCE WHICH IS NECESSARY BEFORE MAKING ADDITION IN THE TOTAL INCOME AT A LL. 8. THE ADDITION OF THE A.O. WAS NOT BASED ON FACTS AND CIRCUMSTANCES OF THE CASE AND NO TIME HAS BEEN ALLOWED TO THE ASSESSEE FOR SUBMITTING DOCUMENTARY EVIDENCE ON RECORD. THE A.O. HAS MADE AN ADDITION SIMPLY ON THE TIME BASIS OF SUSPICION 36 OF ANY MATE RIAL, BUT IN SO MANY COURTS HAS ALREADY DECIDED IN SO MANY CASES THAT SUSPICIOUS MATERIAL CANNOT BE TAKEN PLACE OF THE EVIDENCE. 9. ASSESSEE HAS JUSTIFY OR ESTABLISH THAT CASH DEPOSITED IN THE BANK A/C ARE RECEIVED FROM THE CUSTOMERS WHICH IS VERIFIABLE FROM CASH BOOK FILED BEFORE THE I.T.O & ALSO CONFIRMATION LETTER FROM CUSTOMER FILED BEFORE YOUR HONOR WHICH NARRATED IN OUR REPLY & THAT REPLY WAS SENT TO THE I..T.O. FOR REMAND REPORT BUT I.T.O. HAS NOT CONSIDERED THE REPLY OF THE ASSESSEE & FILED BEFORE YOUR HONOR. 10. THE A.O. HAS PREPARED REMAND REPORT ON THE BASIS OF ASSUMPTION & PRESUMPTION WHICH IS NOT BASED ON THE DOCUMENTARY EVIDENCE & ANY ADDITION BASED ON PRESUMPTION WHICH CANNOT TAKE PLACE OF THE EVIDENCE IN THE EYE OF LAW HENCE WHOLE ADDITION IS ILLEGAL . 11 CONSIDERING ALL THE ABOVE FACTS, CIRCUMSTANCES OF THE CASE AND EVIDENCE I EXPLANATION / DETAILS SUBMITTED TO YOU, WE CONCLUDE TO YOUR HONOR THAT: - A.O. HAS TOTALLY FAILED TO PROVE THAT CASH DEPOSIT I CREDIT ENTRIES IN THE BANK ACCOUNT ARE D ONE THROUGH ONLY SHRI M. L. SAMAR NOT THROUGH ASSESS E ES SON SHRI NILESH SAMAR. THROUGH REMAND REPORT, A.O. HAS N OT ESTABLISHED THAT SHRI MADAN L AL IS AGENT OF THE COMPANY NOT SHRI NILESH SAMAR, OF THIS CHIT FUND CO. 37 THE A.O. HAS NOT CALLED INFORMATION FROM ASSESSEE BEFORE PREPARATION OF REMAND REPORT. T HE A.O. HAS NOT CALLED TO ASSESSEE FOR VERIFICATION/ EXPLANATION ON EVIDENCE SUBMITTED BEFORE YOUR HONOR WHICH IS AGAINST THE NATURAL JUSTICE. THE A.O. HAS MADE ALLEGA TIONS IN T HE REMAND REPORT IS NOT CORRECT , WE HAD REPLY OF ALL ALLEGATIONS WITH EVIDENCE RESPECTED SIR, LOOKING TO THE ABOVE FACTS AND LEGAL ASPECT, IT IS CRYSTAL CLEAR THAT SHRI M. L. SAMAR IS NOT AN AGENT OF THE CHIT FUND CO. & ADDED TOTAL DEPOSIT APPEAR ING IN THE BANK ACCOUNT IN THE TOTAL INCOME WHICH IS TOTALLY INCORRECT AND AGAINST THE NATURAL JUSTICE OF LAW BECAUSE TOTAL CASH I BANK DEPOSIT IN HIS BANK ACCOUNT NEVER BECOME INCOME OF THE ASSESSEE WHICH IS BEING EXPLAINED AT THE TIME OF ASSESSMENT PROCE EDING . THEREFORE, REQUESTED TO YOUR HONOR KINDLY DELETE THE WHOLE ADDITION OF RS. 5801676/ - MADE BY THE A.O. IN THE TOTAL INCOME AND OBLI GE. 3. AFTER CONSIDERING THE ABOVE FACTUAL POSITION WE ARE CONVINCED THAT THE ASSESSEE HAS VERI L Y EXPLAINED DEPOSITS TO THE TUNE OF RS. 58,01,673/ - AS HE HAS FILED COMPLETE DETAILS ABOUT THE AMO UNTS COLLECTED FROM CUSTOMERS WHO HAVE, IN TURN, CONFIRMED THEIR RESPECTIVE DEPOSITS. ONLY SOURCE OF RS. 22,000/ - WAS NOT EXACTLY 38 PRODUCED AND THIS AMOUNT HAS BEEN SUSTAINED BY L D. CIT (A). W E FIND NO INF IRMITY IN THE FINDING GIVEN BY L D. CIT(A) TO THAT EXTENT AND, THEREFORE, WE CONFIRM THE SAME. RESULTANTLY , THE APPEAL OF THE REVENUE STANDS DISMISSED. HOWEVER, WE ARE OF THE CONSIDERED OPINION THAT THE ENTIRE EXPLANATION IS BASED ON THE PHENOMENON THAT THESE DEPOSITS BELONG TO HIS SON SHRI NILESH SAMAR AND THE COMMISSION INCOME DECLARED BY HIM AT RS. 1,49,530/ - HAS TO BE ASSESSED IN THE HANDS OF HIS SON AND NOT IN THE HANDS OF THIS ASSESSEE. 4. IN THE RESULT, THE APPEAL OF THE RE VENUE IS DISMISSED AND THE CROSS - OBJECTION IS ALLOWED. (ORDER PRONOUN CED IN THE OPEN COURT ON 23 RD SEPTEMBER, 2014) SD/ - SD/ - (N.K. SAINI) (HARI OM MARATHA) ACCOUNTANT MEM BER JUDICIAL MEMBER DATED : 23 RD SEPTEMBER, 2014 VL/ COPY FORWARDED TO : - 1. SH. MADAN LAL SAMAR, CHITTORGARH. 2. ITO, WARD - 2, CHITTORGARH . BY ORDER, 3. CIT, UDAIPUR. 4 C IT(A), UDAIPUR. SR. PRIVATE SECRETARY 5 C IT,DR, ITAT, JODHPUR. ITAT, JODHPUR