Deepak Mittal, Uttrakhand V. DCIT, Central Circle, Dehradun

ITA 3972/DEL/2016

• Counselvise Citation: [2022] 104 COUNSELVISE.COM (IT) 0552 (ITAT-DEHRADUN)
• Duration Of Justice: 6 year(s) 3 month(s) 10 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-10-2022
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 12-10-2022
• Assessment Year: 2007-2008
• Appeal Filed On: 07-07-2016
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Unexplained expenditure; Document seized; Principle of natural justice; Documents seized
• Section: 132; 69C; 153A

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DEHRADUN BENCH: DEHRAHUN BEFORE SHRI KUL BHARAT, JUDICIAL MEMBER & DR.B.R.R.KUMAR, ACCOUNTANT MEMBER [THROUGH VIDEO CONFERENCING AT NEW DELHI] ITA Nos.3972 & 3973/Del/2016 [Assessment Years : 2007-08 & 2011-12] Shri Deepak Mittal, Nath House Devpura, Haridwar, Uttarakhand. PAN-AFUPM1036P vs DCIT, Central Circle, Dehradun. APPELLANT RESPONDENT Appellant by None Respondent by Shri Sanjay Pandey, CIT DR Date of Hearing 13.10.2022 Date of Pronouncement 18.10.2022 ORDER PER KUL BHARAT, JM : Both appeals filed by the assessee are directed against the order of Ld. CIT(A), Muzaffarnagar, both dated 16.03.2016 for the assessment years 2007-08 & 2011-12 respectively. Both appeals filed by the assessee are being disposed off by this consolidated order for the sake of brevity and convenience. 2. At the time of hearing, no one attended the proceedings on behalf of the assessee. It is seen from the records that on earlier occasions also, there was no representation on behalf of the assessee. Therefore, both appeals are taken up for hearing and have been decided in the absence of the assessee. ITA No.3972/Del/2016 [Assessment Year : 2007-08] 3. First we take up assessee’s appeal in ITA No. 3972/Del/2016 pertaining to Assessment Year 2007-08. The assessee has raised following grounds of appeal:- Page | 2 1. “The order of assessment passed under section 153A read with 143(3) is bad in law in as much as no assessment of the impugned year was pending on the date of search and the assessment has been framed without referring to any seized material. 2. On the facts and circumstances of the case, the order being passed in violation of the principle of natural justice and without giving adequate time and opportunity to the assessee to represent its case and to file its replies and clarification, is bad in the eye of law and liable to be quashed. 3. That the Ld. CIT(A) has erred on facts and in law in upholding the addition of Rs. 2,45,925/- on account of unexplained expenditure u/s 69C of the Income Tax Act, 1961. 4. That the Ld. CIT(A) has erred on facts and in law in sustaining the impugned addition on the basis of a bunch of loose papers seized from the premises of a third party. 5. That the impugned appellate order is arbitrary, illegal, bad in law and in violation of rudimentary principles of contemporary jurisprudence. 6. That the Appellant craves leave to add/alter any/all before or at the time of hearing of the Appeal.” BRIEF FACTS OF THE CASE [ 4. Facts giving rise to the present appeal are that the assessee is an individual and has been deriving income from business, house property and other sources. A search under section 132 of the Income Tax Act, 1961 (“the Act”) has been carried out in the business and residential premises of the Rama/Shakumbari group of cases of Moradabad on 22.09.2011 and as a part of this group, the residential and official premises of the Mittal family and its concerns which were part of M/s Kanatal Resort & Spa Pvt.Ltd. group of cases was also covered. Thereafter, a notice u/s 153A(1)(a) of the Act was issued on 25.04.2013 and duly served upon the assessee. In response thereto, the Page | 3 assessee filed his return of income on 18.06.2013, declaring income of Rs.3,17,600/-. Thereafter, a notice u/s 143 of the Act was issued to the assessee and in response thereto, Ld. Authorized Representative (“AR”) of the Assessee attended the proceedings on behalf of the assessee. The Assessing Officer (“AO”) after examining the facts, made addition of Rs.2,45,925/- and assessed the income of the assessee at Rs.5,63,530/-. 5. Aggrieved against this, the assessee preferred appeal before Ld.CIT(A) who after considering the submissions, dismissed the appeal of the assessee. 6. Aggrieved against the order of Ld.CIT(A), the assessee is in appeal before this Tribunal. 7. Ground Nos. 1 & 2 raised by the assessee are against the initiation of proceedings and violation of principle of natural justice. 8. On the other hand, Ld.CIT DR opposed these submissions and supported the orders of the authorities below. 9. We have heard Ld.CIT DR and perused the material available on record and gone through the orders of the authorities below. In the absence of any specific evidence in support of the claim of the assessee, we do not see any reason to interfere in the finding of authorities below, the same is hereby affirmed. Thus, Ground Nos. 1 & 2 raised by the assessee are dismissed. 10. Ground No.3 raised by the assessee is against the sustaining of addition of Rs.2,45,925/- on account of unexplained expenditure u/s 69C of the Act. Page | 4 11. Ld.CIT DR supported the order of AO and submitted that the AO has given a finding on fact that the assessee was confronted with the seized documents. He failed to submit any proper credible explanation. 12. We have heard Ld.CIT DR and perused the material available on record and gone through the orders of the authorities below. We find that the AO has given a finding on fact in paras 3.3 to 3.4 of the assessment order, the same is reproduced as under:- 3.3. “A careful analysis of the seized document pg 36 and 52 of LP-9, has brought to light a uniform pattern of expenditure incurred by Deepak Mittal in arranging the accommodation entries which is Rs.1500 per lakh. For example on page 36 on 01.07.2008 for 24 lakhs the cost is 36000 which is @1500per lakh, similarly on 3/7/08 for Rs.6 lakh the cost is 9000/- which is again @1500 per lakh. Based on this the cost of arranging Rs.l.70crores of unaccounted money through entries is Rs.2,55,000/- which has been incurred by Deepak Mittal. Similar details are on page 52 as per which in addition to above, the cost incurred by Deepak in arranging entry for Rs.315 lakhs is Rs.21000/- @ the cost of 1500. 3.4 When the assessee was confronted with above seized documents and asked to furnish an explanation, he failed to submit any proper creditable explanation and simply stated that these are rough jottings by staff. In light of the analysis of seized material and accounts of the assessee and the companies, the replies filed by him are found to be inadequate and unexplained. Therefore, it is rejected and income assessed accordingly. During the year under review, the company M/s Doon concrete gallery Pvt Ltd has received bogus share application money of Rs. 1,63,95,000/- during the year under review, (this issue has been examined in case of the company]. Therefore the expenses incurred by assessee @ 1500 per lakh are Rs.2,45,925/- during the year which are treated as unexplained expenditure u/s Page | 5 69C in his hands and added to his total income.” (2,45,925/-). 13. The assessee has not brought any material to rebut the findings of the AO. We, therefore, do not see any reason to interfere in the finding of the authorities below, the same is hereby affirmed. Thus, Ground No.3 raised by the assessee is dismissed. 14. Ground Nos. 4 & 5 raised by the assessee are against the sustaining of impugned addition on the basis of a bunch of loose papers seized from the premises of a third party and not providing opportunity to the assessee. 15. Ld.CIT DR supported the orders of the authorities below and submitted that in support of this ground, the assessee has not filed any evidences. Further, he submitted that the authorities below have brought out the case clearly. Therefore, the authorities below were justified to make addition and sustained the same. 16. We have heard Ld.CIT DR and perused the material available on record and gone through the orders of the authorities below. We find that the assessee has not brought any material in support of these grounds. In the absence of such material, we do not see any reason to disturb the findings of Ld.CIT(A), the same is hereby affirmed. Thus, Ground Nos. 4 & 5 raised by the assessee are rejected and dismissed. 17. In the result, the appeal of the assessee is dismissed. Page | 6 ITA No. 3973/Del/2016 [Assessment Year 2011-12] 18. Now, we take up the assessee’s appeal in ITA No. 3973/Del/2016 pertaining to the Assessment Year 2011-12. The assessee has raised following grounds of appeal:- 1. “The order of assessment passed under section 153A read with 143(3) is bad in law in as much as no assessment of the impugned year was pending on the date of search and the assessment has been framed without referring to any seized material. 2. On the facts and circumstances of the case, the order being passed in violation of the principle of natural justice and without giving adequate time and opportunity to the assessee to represent its case and to file its replies and clarification, is bad in the eye of law and liable to be quashed. 3. That the Ld. CIT(A) has erred on facts and in law in upholding the addition of Rs.1,50,000/- on account of unexplained expenditure u/s 69C of the Income Tax Act, 1961. 4. That the Ld. CIT(A) has erred on facts and in law in sustaining the impugned addition on the basis of a bunch of loose papers seized from the premises of a third party. 5. That the impugned appellate order is arbitrary, illegal, bad in law and in violation of rudimentary principles of contemporary jurisprudence. 6. That the Appellant craves leave to add/alter any/all grounds of appeal before or at the time of hearing of the Appeal.” 19. The facts and grounds raised by the assessee are identical. The Ld. CIT DR adopted the same arguments as were in ITA No.3972/Del/2016 [Assessment Year 2007-08]. The identical grounds in ITA No.3972/Del/2016 has been dealt in ITA No.3973/Del/2016 [Assessment Year 2011-12]. Therefore, taking the consistent view, we do not see any reason to interfere in Page | 7 the findings of Ld.CIT(A), the same is hereby affirmed. Thus, grounds raised by the assessee are dismissed. 20. In the result, the appeal of the assessee is dismissed. 21. In the final result, both appeals of the assessee are dismissed. Order pronounced in the open Court on 18 th October, 2022. Sd/- Sd/- (DR.B.R.R.KUMAR) (KUL BHARAT) ACCOUNTANT MEMBER JUDICIAL MEMBER * Amit Kumar * Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT ASSISTANT REGISTRAR ITAT, NEW DELHI