ITO, Uttrakhand V. Shri Manohar Lal Kalra, Uttrakhand

ITA 4158/DEL/2010

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 3871 (ITAT-DELHI)
• Duration Of Justice: 8 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-05-2011
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: E
• Next Hearing Date: 26-05-2011
• Assessment Year: 2004-2005
• Appeal Filed On: 08-09-2010
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: A K MONGA SENIOR
• Assessee Lawyers: K SEHGAL
• Keywords: Loose papers; Additional evidence; Set aside
• Section: 69C; 133A

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH E : NEW DELHI) SHRI I.P. BANSAL, JUDICIAL MEMBER AND BEFORE SHRI B.C. MEENA, ACCOUNTANT MEMBER ITA NO.4158/DEL./2010 (ASSESSMENT YEAR : 2004-05) ITO, SRINAGAR (GARHWAL), VS. SHRI MANOHAR LAL KAL RA, UTTRAKHAND. GOLE BAZAR, SRINAGAR (GARHWAL), UTTRAKHAND. (PAN/GIR NO.M-245) (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI K. SEHGAL, CA REVENUE BY : SHRI A.K. MONGA, SENIOR DR O R D E R PER B.C. MEENA, ACCOUNTANT MEMBER : THE REVENUE HAS FILED THIS APPEAL AGAINST THE ORDER OF CIT (APPEALS)-II, DEHRADUN DATED 21.05.2010 FOR THE ASSESSMENT YEAR 2 004-05. THE GROUNDS OF APPEAL TAKEN BY THE ASSESSEE READ AS UNDER :- 1. THE LD. CIT (A) HAS ERRED IN LAW AND ON FACT IN ALLOWING THE RELIEF OF RS.1,71,000/-, RS.7,70,000/-, RS.6,340,00 0/- AND RS.24,945/- MADE BY THE A.O. ON THE BASIS OF LOOSE PAPER FOUND AND IMPOUNDED DURING THE SURVEY PROCEEDINGS, HOLDING TH AT THE LOOSE PAPER DOES NOT CONTAIN ANY SIGNATURE, DATE OF TRANS ACTION WHEREAS THE EXISTENCE OF LOOSE PAPER, HANDWRITING AND THE P ERSON RELATING TO THESE ENTRIES HAS NEVER BEEN QUESTIONED BY HIM. 2. THE LD. CIT (A) HAS ERRED IN LAW AND ON FACTS IN ENTERTAINING THE ADDITIONAL EVIDENCE WITHIN THE MEANING OF RULE 46A OF THE I.T. RULES. ITA NO.4158/DEL./2010 2 2. IN THE GROUND NO.1, THE REVENUE HAS CHALLENGED T HE DELETION OF THE ADDITIONS AND IN GROUND NO.2, THE REVENUE HAS PLEADED AGAINST THE ENTERTAINMENT OF ADDITIONAL EVIDENCE AGAINST RULE 46A OF THE INCOME-TAX RULES. 3. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSE E IS AN INDIVIDUAL DERIVING INCOME FROM TRADING IN CLOTH ON RETAIL BASIS AT SRI NAGAR. A SURVEY OPERATION U/S 133A WAS CARRIED OUT ON 30.4.2003. IN THE SURVEY O PERATION, CERTAIN INCRIMINATING DOCUMENTS WERE IMPOUNDED. IT IS AN ADMITTED FACT T HAT THE DOCUMENTS IMPOUNDED IN THE SURVEY OPERATION WERE WRITTEN IN ASSESSEES OWN HANDWRITING WHICH HE HAS CATEGORICALLY STATED IN REPLY TO QUESTION NO.6 IN T HE STATEMENT RECORDED DURING THE SURVEY OPERATION ON 30.4.2003. IN THIS STATEMENT, HE HAS ALSO STATED THAT AT THE TIME OF SURVEY, HE WAS NOT ABLE TO GIVE FULL DETAILS IN RESPECT OF ENTRIES ON THESE PAPERS REGARDING LOTTERY, DENDARI (LIABILITY), STOCK, PAGR Y, CREDIT AND RD AT BANK AND POST OFFICE, NSC, ETC. 4. THE LEARNED DR SUBMITTED THAT THERE WAS ENTRY IN THE LOOSE PAPER REGARDING THE GL LOTTERY AT PAGE 172 OF ANNEXURE 3. THE ASSE SSEE WAS ASKED TO EXPLAIN AND JUSTIFY THESE ENTRIES AND NARRATIONS. THE ASSESSEE STATED THAT IT BELONGS TO HIS REAL BROTHER AND WHEN HIS BROTHER WAS ASKED TO EXPLAIN, HE COMPLETELY DENIED HAVING ANY CONCERN WITH THESE ENTRIES. SIMILARLY, THERE I S A MENTION IN RESPECT OF LIABILITY AND PREMIUM FOR THE SHOP IN THE IMPOUNDED PAPERS. THE ASSESSEE HAS NOT GIVEN SATISFACTORY EXPLANATION AT THE TIME OF SURVEY AS W ELL AS DURING THE ASSESSMENT PROCEEDINGS AND THE CIT (A) DELETED THE ADDITION BY HOLDING THAT THESE ARE UNRELATED PIECE OF PAPERS WHICH DID NOT RELATE TO THE ASSESSE E. SIMILARLY, THE ADDITION IN RESPECT OF EXPENDITURE INCURRED FOR CONSTRUCTION WO RK MADE ON THE BASIS OF ENTRIES ITA NO.4158/DEL./2010 3 IN THE IMPOUNDED MATERIAL. THESE ENTRIES WERE NOT FOUND IN THE REGULAR BOOKS OF ACCOUNT, THEREFORE, ADDITION U/S 69C WAS MADE. THE CIT (A) DELETED THE ADDITION WITHOUT ANY COGENT REASONS AND EXPLANATIONS. HE VE HEMENTLY PLEADED THAT THESE LOOSE PAPERS WERE IMPOUNDED FROM THE PREMISES OF TH E ASSESSEE AND ADMITTEDLY, THESE LOOSE PAPERS WERE WRITTEN IN ASSESSEES OWN H ANDWRITING. IN SUCH A SITUATION, ONLY THE ASSESSEE WHO CAN EXPLAIN THESE ENTRIES. H E IS WELL-AWARE ABOUT THESE ENTRIES AND THE ONUS IS COMPLETELY ON HIM TO EXPLAI N THESE ENTRIES, THEREFORE, THE ORDER OF CIT (A) IS COMPLETELY UNJUSTIFIED. 5. ON THE OTHER HAND, LEARNED AR RELIED ON THE ORDE R OF THE CIT (A) AND PLEADED THAT THE ASSESSEE HAS EXPLAINED CERTAIN ENTRIES AND IN RESPECT OF THE TRUCK NUMBERS IN ANSWER TO QUESTION NO.4 AND STATED TO WHOM THESE WE RE BELONGING. HE PLEADED THAT THESE WERE THE ENTRIES MADE FOR THE PURPOSE OF DIVI SION IN THE FAMILY BUT NO DIVISION HAS TAKEN PLACE. THESE ENTRIES WERE IN ROUND FIGUR ES AND ONLY ESTIMATES OF VALUE. HE SUPPORTED THE ORDER OF THE CIT (A). 6. AFTER HEARING BOTH THE SIDES, WE FIND THAT DOCUM ENTS WERE IMPOUNDED FROM THE PREMISES OF THE ASSESSEE IN OPERATION U/S 133A. THE ASSESSEE HAS ADMITTED IN HIS STATEMENT THAT THESE PAPERS WERE WRITTEN IN HIS OWN HANDWRITING. FROM THE STATEMENT RECORDED AT THE TIME OF SURVEY, WE FIND T HAT HE HAS EXPLAINED CERTAIN ENTRIES OF SEIZED PAGE NO.172. HE HAD STATED ONLY IN RESPECT OF THE TRUCK NUMBERS AND THE FIGURES WRITTEN THEREUPON. HOWEVER, NO EXP LANATION WAS FURNISHED IN HIS STATEMENT ABOUT THE OTHER ENTRIES. THEREAFTER ALSO NO EXPLANATION WAS MADE BEFORE THE ASSESSING OFFICER AS WELL AS THE CIT (A) IN RES PECT OF THESE ENTRIES REGARDING THE GL LOTTERY, LIABILITY, PAGRY, RD AND OTHER ENTRIES RECORDED. SINCE THESE PAPERS ARE ITA NO.4158/DEL./2010 4 ADMITTEDLY IN ASSESSEES OWN HANDWRITING AND IMPOUN DED FROM THE PREMISES OF THE ASSESSEE, IT IS THE ASSESSEE WHO KNOWS BEST ABOUT T HESE ENTRIES. IT IS ONLY IN THE KNOWLEDGE OF THE ASSESSEE TO EXPLAIN TO WHICH PARTI CULAR YEAR THESE ENTRIES ARE BELONGING. HE HAD NOT DONE SO. THE CIT (A) HAS CO MPLETELY UNJUSTIFIED IN DELETING THE ADDITION BY HOLDING THAT ADDITION MADE ON THE B ASIS OF THESE ENTRIES WAS WHOLLY INCORRECT AND WITHOUT APPLICATION OF MIND. IN THE INTEREST OF JUSTICE AND EQUITY, WE SET ASIDE THE ORDER OF CIT (A) AND RESTORE THE ISSU E TO THE FILE OF THE ASSESSING OFFICER. THE ASSESSEE SHALL BE PROVIDED AN OPPORTU NITY TO EXPLAIN THESE ENTRIES RECORDED IN THESE IMPOUNDED PAPERS. ASSESSING OFFI CER SHALL DECIDE THE ASSESSMENT DE NOVO AFTER PROVIDING AN OPPORTUNITY OF BEING HEA RD. 7. IN THE RESULT, THE APPEAL OF THE REVENUE IS ALLO WED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN OPEN COURT ON THIS 27 TH DAY OF MAY, 2011. SD/- SD/- (I.P. BANSAL) (B.C. MEENA) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED THE 27 TH DAY OF MAY, 2011 TS COPY FORWARDED TO: 1.APPELLANT 2.RESPONDENT 3.CIT 4.CIT(A)-II, DEHRADUN. 5.CIT(ITAT), NEW DELHI. AR, ITAT