ACIT, UDAIPUR V. Sh. Naresh Singhvi, UDAIPUR

ITA 454/JODH/2012

• Counselvise Citation: [2013] 120 COUNSELVISE.COM (IT) 4890 (ITAT-JODHPUR)
• Duration Of Justice: 8 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-09-2013
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 25-09-2013
• Assessment Year: 2007-2008
• Appeal Filed On: 31-12-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: N A JOSHI
• Keywords: Loose papers; Source of fund; Corroborative evidences; Retraction
• Section: 133A

Judgement Text

IN THE INCOME TAX APPELALTE TRIBUNAL : JODHPUR BENC H : JODHPUR BEFORE SHRI HARI OM MARATHA, JUDICIAL MEMBER AND SHRI N.K. SAINI, ACCOUNTANT MEMBER. ITA NO. 454/JODH/2012 (A.Y. 2007-08) ACIT, VS. SHRI NARESH SINGHVI, CIRCLE-1, PROP. M/S. BHANWAR LAL UDAIPUR. MADAN LAL SINGHVI, 42, BHADBUJA GHATI, UDAIPUR. PAN NO. AEEPS 0035 F (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI P.C. PARWAL DEPARTMENT BY : SHRI N.A. JOSHI- D.R. DATE OF HEARING : 25/09/2013. DATE OF PRONOUNCEMENT : 27/09/2013. O R D E R PER N.K.SAINI, A.M THIS IS AN APPEAL BY THE DEPARTMENT AGAINST THE OR DER DATED 09/10/2012 OF LD. CIT (A), UDAIPUR. THE ONLY GROUN D RAISED IN THIS APPEAL RELATES TO THE DELETION OF ADDITION OF INCOME OF RS . 17.68 LACS ADMITTED DURING THE COURSE OF SURVEY, BUT NOT DISCLOSED IN T HE RETURN OF INCOME. 2 FACTS RELATED TO THIS ISSUE IN BRIEF ARE THAT ASSE SSEE FILED HIS RETURN OF INCOME ON 31/10/2007 DECLARING TOTAL INCOME OF R S. 52,90,620/- AND 2 THE SAME WAS PROCESSED UNDER SECTION 143(1) OF THE I.T. ACT, 1961 (HEREINAFTER REFERRED TO AS ACT, FOR SHORT) ON14/ 07/2008. THEREAFTER, THE CASE WAS TAKEN UP FOR SCRUTINY ON THE GROUNDS O F BEING A SURVEY CASE. THE ASSESSING OFFICER POINTED OUT THAT THE GP RATE AND NP RATE DECLARED BY THE ASSESSEE WERE PROGRESSIVE IN COMPARISON TO T HE EARLIER YEAR. THE ASSESSING OFFICER OBSERVED THAT A SURVEY UNDER SECT ION 133A OF THE ACT WAS CONDUCTED IN THE BUSINESS PREMISES OF THE ASSES SEE ON 05/02/2007 AND VARIOUS LOOSE PAPERS WERE FOUND , WHICH CONTAIN ED UNACCOUNTED TRANSACTIONS NOT REFLECTED IN THE BOOKS OF ACCOUNTS AND THE ASSESSEE SURRENDERED AN AMOUNT OF RS. 18,00,000/- ON THE BAS IS OF INCRIMINATING DOCUMENTS, HOWEVER, IN THE RETURN FILED, THE ASSESS EE AGAINST THE SUM OF RS. 18 LAC SURRENDERED ONLY RS. 32,000/-. THE ASSES SING OFFICER, THEREFORE, ASKED THE ASSESSEE TO SHOW-CAUSE WHETHER THE AMOUNT OF RS. 18 LAC HAD BEEN OFFERED FOR TAXATION ON ACCOUNT OF VARIOUS LOOSE PAPERS AND THE ENTRIES IN IT, WHICH WERE ACCEPTED BY THE A SSESSEE TO BE RELATED TO HIS UNACCOUNTED TRANSACTIONS. IT WAS ALSO ASKED TO SHOW-CAUSE IN CASE THE AMOUNT OF RS. 18 LAC WAS NOT DISCLOSED IN THE R ETURN, AS TO WHY THE AMOUNT NOT OFFERED FOR TAXATION BE NOT ADDED TO THE INCOME OF THE ASSESSEE. IN RESPONSE, THE ASSESSEE SUBMITTED THAT TOTAL INCOME OFFERED FOR TAXATION WAS RS. 45.40 LAC OF WHICH ONLY RS. 32 ,000/- WAS ON ACCOUNT 3 OF LOOSE PAPERS. IT WAS FURTHER STATED THAT DURING THE TIME OF SURVEY, THE SURRENDER OF RS. 18 LAC WAS MADE ON ACCOUNT OF LOOS E PAPERS, BUT AFTER THOROUGH VERIFICATION OF ALL THE LOOSE PAPERS, NO S UCH UNACCOUNTED TRANSACTION WAS FOUND EXCEPT RS. 32,000/-, WHICH WE RE OFFERED FOR TAXATION. THE ASSESSING OFFICER DID NOT FIND MERIT IN THE SUBMISSIONS OF THE ASSESSEE AND OBSERVED THAT A MERE EXPLANATION O F THE ENTRIES WITHOUT ANY SUPPORTING EVIDENCE COULD NOT FORM THE BASIS FO R RETRACTION AS DONE BY THE ASSESSEE. HE WAS OF THE VIEW THAT THE RETRA CTION WAS A AFTERTHOUGHT IN ORDER TO EVADE THE TAX LIABILITY, H E THEREFORE, MADE THE ADDITION OF RS. 17.68 LAC AS THE ASSESSEE HAD OFFER ED ONLY RS. 32,000/- OUT OF RS. 18 LAC. 3. BEING AGGRIEVED, ASSESSEE CARRIED THE MATTER TO TH E LEARNED CIT(A) AND THE SUBMISSION MADE AS INCORPORATED IN PARA 2.2 OF THE IMPUGNED ORDER ARE REPRODUCED VERBATIM AS UNDER:- ''ADDITION OF RS. 1768000.00 (RS. 1800000.00 SURREND ER IN SURVEY PROCEEDINGS LESS RS. 32000.00 OFFERED FOR TAX) ON ACCOUNT OF LOOSE PAPER S THAT IN RESPECT OF ADDITION OF RS. 1768000.00 ON AC COUNT OF LOOSE PAPERS, WE WOULD LIKE TO STATE HERE THAT THE ASSESSEE SUBMITTED ALL THE D ETAILS, EXPLANATIONS & INFORMATIONS SOUGHT BY THE LD. ACIT IN TIME TO TIME AND FILED AN NEXURE WISE REPLY DURING THE COURSE OF ASSESSMENT PROCEEDINGS IN ALMOST 12 HEARINGS AND GO T VERIFIED ALL THE INCRIMINATING LOOSE PAPERS FROM THE REGULAR BOOKS OF ACCOUNTS OF HIS PROPRIETARY CONCERN OR FROM HIS SISTER CONCERNS. BUT THE LEARNED ACIT DOES NOT CONS IDER THE SAME AND MADE ADDITION OF RS. 1768000.00 WITHOUT ANY BASIS & AS PER HIS CONVE NIENCE. IN SUPPORT, WE WOULD LIKE TO DRAW YOUR KIND ATTENTI ON TOWARDS THE FOLLOWING CASES: DEPUTY COMMISSIONER OF LNCOME TAX VS. PRAMUKH BUILD ERS [(2008) 1 15 TTJ (AHD) (TM) 330 (2008) 112 ITD 179 (2008) 5 DTR 166] 4 THERE BEING NO SPECTRA OF EVIDENCE REGARDING UNDISC LOSED INCOME, ADDITION MADE ONLY ON THE BASIS OF STATEMENT OF MANAGING PARTNER OF AS SESSEE UNDER S 132(4), GIVEN IN A STATE OF CONFUSION AND LATER RETRACTED, COULD NOT B E SUSTAINED EITHER IN PART OR AS A WHOLE. ASSISTANT COMMISSIONER OF INCOME TAX VS. JORAWAR SI NGH M. RATHOD [(2005) 94 TTJ (AHD) 867] ADDITION MADE BY THE A0 MERELY ON THE BASIS OF RETR ACTED STATEMENT UNDER S. 132(4) COULD NOT BE SUSTAINED IN THE ABSENCE OF ANY EVIDEN CE, MATERIAL OR RECOVERY OF ANY MOVABLE OR IMMOVABLE ASSETS AT THE TIME OF SEARCH T O CORROBORATE THE DISCLOSURE MADE BY THE ASSESSEE. COMMISSIONER OF LNCOME TAX VS. S. KHADER KHAN SON [ (2008) 214 CTR (MAD) 589 : (2008) 300 ITR 157 (MAD)] SEC. 133A DOES NOT EMPOWER ANY IT AUTHORITY TO EXAM INE ANY PERSON ON OATH, HENCE, ANY STATEMENT HAS NO EVIDENTIARY VALUE AND ANY ADMI SSION MADE DURING SUCH STATEMENT CANNOT, BY ITSELF, BE MADE THE BASIS FOR ADDITION. COMMISSIONER OF LNCOME TAX VS. G. K. SENNIAPPAN [(2 006) 203 CTR (MAD) 407: (2006) 284 ITR 220 (MAD) : (2006) 155 TAXMAN 118 (MAD)] MATERIAL GATHERED IN THE COURSE OF SURVEY UNDER S. 133A CANNOT BE REGARDED AS RELEVANT MATERIAL FOR THE PURPOSE OF COMPUTATION OF UNDISCLO SED INCOME UNDER S. 158BB ASSISTANT COMMISSIONER OF LNCOME TAX VS. SMT. USHA RANI TALLA [(2010) 6 ITR (TRIB) 37 (DEL)] MERELY ON THE BASIS OF STATEMENT MADE BY ASSESSEE D URING SURVEY SURRENDERING CERTAIN AMOUNTS, WHICH STATEMENT IS SUBSEQUENTLY RETRACTED ON THE GROUND THAT IT WAS MADE IN A DISTURBED STATE OF MIND, ADDITION AS UNDISCLOSED CANNOT BE MADE WITHOUT THERE BEING ANY MATERIAL TO CORROBORATE THE STATEMENT. KRISHAN LAL SHIV CHAND RAI VS. COMMISSIONER OF LNCO ME TAX [(1973) 88 ITR 293 (P&H)] ASSESSEE SURRENDERING AMOUNTS REPRESENTING CERTAIN HUNDI LOANS IN ASSESSMENT PROCEEDINGS BUT IN PENALTY PROCEEDINGS, CLAIMING TH AT THE CREDITS WERE GENUINE, THAT THE ADMISSION WAS MADE ONLY TO AVOID BOTHERATION AND TH AT IT SHOULD BE GIVEN OPPORTUNITY TO PROVE THAT THE CREDITS WERE GENUINE. PENALTY LEV IED WITHOUT SUCH OPPORTUNITY TO ASSESSEE WAS INVALID THE SIMILAR FACTS WAS HAPPENS IN THE ASSESSEE'S CAS E, WHEREIN, TO PURCHASE PEACE OF MIND & TO AVOID FURTHER LITIGATION, THE ASSESSEE OF FERED RS. 1800000.00 AT THE TIME OF SURVEY ON THE BASIS OF DOCUMENTS FOUND DURING THE C OURSE OF SURVEY. HOWEVER, EVERY TIME THE ASSESSEE STATED IN HIS STATEMENT THAT AT P RESENT HE IS NOT ABLE TO VERIFY THE DOCUMENTS HOWEVER, THE SAME WILL BE VERIFIED BY HIM IN LATER STAGES AND IF STILL SOME DOCUMENTS REMAIN UNACCOUNTED, HE WILL OFFER THE SAM E FOR TAX PURPOSES. COPY OF 5 STATEMENT RECORDED DURING THE COURSE OF SURVEY IS E NCLOSED HEREWITH FOR YOUR KIND PERUSAL & VERIFICATION. AT THE TIME OF FILING OF IT RETURN, ON THE BASIS OF VOLUMINOUS WORKING, THE ASSESSEE OFFERED RS. 4508356.00 ON ACCOUNT OF STOCK & RS. 32 1 18.00 ON ACCOUNT OF LOOSE PAPERS, TOTAL AMOUNTING TO RS. 4541237.00 FOR THE TAX PURPO SES AND DETAILS OF THE SAME HAS ALSO BEEN SUBMITTED DURING THE COURSE OF ASSESSMENT PROC EEDINGS. COPY OF ABOVE WORKING AND COPY OF AUDITED STATEMENT OF AFFAIRS FOR THE F. Y. 2006-2007 IS ENCLOSED HEREWITH FOR YOUR KIND PERUSAL & VERIFICATION. FURTHER, IN THE ASSESSEE'S CASE, BEFORE MAKING THE ADDITION OF RS. 1768000.00, THE LD. ACIT DOES NOT POINT OUT ANY EVIDENCE, MATERIAL OR D OCUMENTS IN SUPPORT OF HIS CONTENTION FOR MAKING ADDITION AT TIME OF FINALIZAT ION OF THE ASSESSMENT PROCEEDINGS OR ON THE BASIS OF WHICH, IT CAN BE SAID THAT THE DISC LOSURE MADE BY THE ASSESSEE IS SUSTAINABLE, THE LD. ACIT MADE THE ABOVE ARBITRARY ADDITIONS ONLY ON GUESS WORK WITHOUT REFERENCE TO ANY EVIDENCE OR ANY MATERIAL A T ALL. HENCE, THE ACTION OF THE LD. ACIT IS BAD IN LAW & LIABLE TO BE DELETED. UNDER THE ABOVE FACT & CIRCUMSTANCES AND VARIOUS LE GAL PRONOUNCEMENTS, THE LD. ACIT HAS NOT JUSTIFY IN MAKING ARBITRARY ADDITION OF RS. 1768000.00 ON THE BASIS OF STATEMENT RECORDED DURING THE COURSE OF SURVEY. THEREFORE, WE HUMBLY REQUEST YOUR HONOUR TO ACCEPT OUR SUBMISSION AND IT WOULD BE A VERY KIND T O THE ASSESSEE FOR DELETING THE ADDITIONS OF RS. 1768000.00 MADE BY THE LD. ACIT.' FURTHER, AS REGARDS THE CONTENTION THAT MOST OF THE TRANSACTIONS MENTIONED IN THE LOOSE PAPERS FOUND AT THE TIME OF SURVEY ON THE BASIS OF WHICH THE SURRENDER OF RS.18 LACS WERE MADE ARE RECORDED IN THE BOOKS OF ACCOUNT AND THEREFORE, THE ASSESSEE HAS DECLARED ONLY RS.32,118 , THE APPELLANT HAS SUBMITT ED AS UNDER: ' ANNEXURE-A/EX-L: 1. PAGE NO., 1-5: THIS IS THE ROUGH BALANCE SHEET OF F.Y. 2005-2006 OF THE ASSESSEE. 2. PAGE NO.- 6: THIS IS THE COPY OF LAND REVENUE A CCOUNT OF SHRI BHERA DANGI AND NOT RELATED TO THE ASSESSEE. 3. PAGE NO.- 7-48: THESE ARE THE PAPERS RELATED TO THE MANTRAM EDUCATIONAL SOCIETY & AMRITYA EDUCATIONAL SOCIETY I.E. CONSTITUTION, RE GISTRATION CERTIFICATE, TRIAL BALANCE ETC. 4. PAGE NO.- 49-68: THESE PAPERS ARE RELATES TO TH E MANTRAM EDUCATIONAL SOCIETY & AMRITYA EDUCATIONAL SOCIETY I.E, AFFIDAVITS, CORRES PONDENCES WITH GOVERNMENT OFFICES & NCTE FOR APPROVAL OF COLLEGES ETC. 5. PAGE NO.-69: THIS PAPER CONTAINING DETAILS OF C HEQUE, CHEQUE DATES & AMOUNT THEREOF RELATES TO THE ADVANCE RECEIVED AGAINST LAN D SALE BY SHRI MANOHAR LAL 6 LODHA ON BEHALF OF THE ASSESSEE TO EVERSHINE EXPORT S & J N FISCAL, FOR WHICH THE ADVANCE RECEIVED BY THE ASSESSEE & HIS FAMILY MEMBE RS ARE SHOWN ON THIS PAGE THROUGH ACCOUNT PAYEE CHEQUE, WHICH IS STATED IN TH E RESPECTIVE BANK ACCOUNT OF THE ASSESSEE & HIS FAMILY MEMBERS. THE ABOVE CONTEN TION OF THE ASSESSEE IS ALSO CO-RELATED WITH THE PG NOS. 1,4,5 OF ANNEXURE A-5, WHEREIN THE DESCRIPTION OF THE AMOUNT MENTIONED IN THE PAGE IS STATED NAMEWISE OF THE ASSESSEE & HIS FAMILY MEMBERS SMT. MANJU SINGHVI, SHRI SOURABH SINGHVI, S HRI KARTIK SINGHVI & M/S NARESH SINGHVI HUF. IT IS ALSO PERTINENT TO STATE H ERE THAT THE AFORESAID TRANSACTION ARE ALSO SHOWN IN THE IT RETURN OF SMT. MANJU SINGHVI & SHRI KARTIK SINGHVI FOR THE RELEVANT A.Y. 2007-2008. COPY OF IT RETURN IS ENCLOSED HEREWITH FOR YOUR KIND PERUSAL & VERIFICATION. 6. PAGE NO,- 70-83: THESE PAPERS ARE RELATES TO TH E MANTRAM EDUCATIONAL SOCIETY & AMRITYA EDUCATIONAL SOCIETY I.E. UNDERTAKINGS, CORR ESPONDENCES WITH GOVERNMENT OFFICES & AICTE FOR APPROVAL OF COLLEGES ETC., 7. PAGE NO. 51,75& 76: THESE ARE COPY OF FDR'S WITH UNION BANK OF LNDIA OF MANTRAM EDUCATION SOCIETY AND SHOWN IN THE AUDITED BALANCE SHEET OF SOCIETY FOR THE RELEVANT F.Y. 2006-2007. COPY OF BALANCE SH EET OF MANTRAM EDUCATION SOCIETY IS ENCLOSED HEREWITH FOR YOUR KIND PERUSAL & VERIFICATION. 8. PAGE NO.-84-86: THESE PAPERS RELATES TO THE SBB J BANK ACCOUNT OF THE ASSESSEE AND THIS ENTRY ARE STATED IN THE REGULAR BOOKS OF A CCOUNT OF THE ASSESSEE. ANNEXURE-A/EX-2: 1 PAGE NO.- 1-9, 15,22-23: THESE ARE THE CHEQUES O R CHEQUE RETURN MEMO IN THE NAME M/S BHANWAR LAL MADAN LAL SINGHVI & STATED IN THE REGULAR BOOKS OF ACCOUNT OF THE ASSESSEE. 2. PAGE NO.- 10-14: THIS IS THE ADVANCE RECEIVED A GAINST GOODS SOLD AND ALREADY BEEN CONSIDERED IN THE WORKING OF UNRECORDED PURCHA SES OR DEBTORS, WHILE COMPUTING INCOME FOR THE RELEVANT F.Y. 2006-2007 AN D OFFERED RS. 63000.00 ON ACCOUNT OF IT. 3. PAGE NO.- 16-20: THESE PAPERS RELATES TO THE HA LLMARKING. 4 PAGE NO.. 26-35: THESE ARE THE CASH DEPOSIT SLIP OF SHRI PUKHRAJ JAIN SBBJ BANK ACCOUNT FOR REPAYMENT OF HIS HOUSING LOAN & NOT REL ATED TO THE ASSESSEE. ANNEXURE.A/EX-3 : 1. PAGE NO.- 1-17: THESE PAPERS RELATES TO THE HAL LMARKING, TRANSACTIONS OF SHARES, DIVIDEND ETC., WHICH HAS ALREADY BEEN SHOWN IN HIS REGULAR BOOKS OF ACCOUNTS. 2. PAGE NO.- 18-40: THIS ARE THE STATEMENTS OF MUT UAL FUNDS IN THE NAME OF ASSESSEE AND HIS FAMILY MEMBERS AND ALREADY BEEN SH OWN IN HIS LT RETURNS. 7 3. PAGE NO.-41: THIS PAPER RELATES TO THE TRANSACT ION WITH SHRI SUNDER LAL LODHA. IN THIS TRANSACTION THE ASSESSEE RECEIVED EXCESS GOLD 116.440 AMOUNTING TO RS. 100815.00 FROM SHRI SUNDER LAL LODHA & ALREADY BEEN CONSIDERED IN THE WORKING OF UNRECORDED PURCHASES OR DEBTORS, WHILE COMPUTING INCOME FOR THE RELEVANT F.Y. 2006-2007 4. PAGE NO. 42-55: THESE PAPERS CONTAIN SOME ROUGH NOTINGS, WORKINGS & CALCULATIONS. 5. PAGE NO.- 56-61: THESE PAPERS RELATES TO THE HAL LMARKING. 6. PAGE NO.- 63'64: THESE ARE THE ISSUE VOUCHERS OF M/S MULCHAND R SHAH & STATED IN THE REGULAR BOOKS OF ACCOUNT OF THE ASSESSEE. C OPY OF BILLS 7. FROM SHRI MULCHAND R SHAH IS ENCLOSED HEREWITH FOR YOUR KIND PERUSAL & VERIFICATION. 8. PAGE NO.- 65: THIS IS THE MONTHWISE STATEMENT O F HALLMARKING. 9. PAGE NO.-66: THIS IS THE ENVELOP COVER AND STAT ED THE CHEQUE DETAILS OF THE BANK ACCOUNT. 10. PAGE NO.-67: NOT RELATES TO THE ASSESSEE. 11. PAGE NO.- 68-71: THESE ARE THE HBL STATEMENT O F SHRI PUKHRAJ JAIN & NOT RELATED TO THE ASSESSEE. 12. PAGE NO.- 72-82: THIS IS THE SALE DEED OF MANT RAM EDUCATIONAL SOCIETY. THE LAND WAS PURCHASED BY THE MANTRAM EDUCATION SOCIETY AT A CONSIDERATION OF RS. 140590.00 (RS. 100000.00 + RS. 5000.00 + RS.35590.0 0) AND RS.494720.00 (RS. 350000.00 + RS. 10000.00 + RS. 134720.00) TOTAL AMO UNTING TO RS. 635310.00 FROM ITS EXPLAINED SOURCE OF FUND AND STATED IN ITS REGULAR BOOKS OF ACCOUNTS OF THE SOCIETY DURING THE RELEVANT F.Y. 2006-2007. COP Y OF BALANCE SHEET OF MANTRAM EDUCATION SOCIETY FOR THE F,Y. 2006-2007 IS ENCLOSED HEREWITH FOR YOUR KIND PERUSAL & VERIFICATION. 13. PAGE NO. - 83-89: THIS IS THE LAND PURCHASE DE ED OF SMT. MANJU SINGHVI AND STATED IN HER REGULAR BOOKS OF ACCOUNT. 14. PAGE NO.- 90-91, THESE ARE THE DETAILS OF SHAR ES AND STATED IN HER REGULAR BOOKS OF ACCOUNT. ANNEXURE-A/EX-4: THIS IS THE NEEL GAGAN SLIP PAD CONTAINING PAGE NO. 1-21 IS THE DETAILS OF CUSTOMER, TO WHOM THE ASSESSEE RECEIVED THE ORDERS FOR JEWELLERY AND RECEIVED ADVANCE FROM THEM. LN THIS RESPECT, WE WOULD LIKE TO STATE HERE THAT W HILE COMPUTING THE INCOME FOR THE RELEVANT F.Y. '2006-2007, THE ASSESSEE HAS ALREADY BEEN CONSIDERED THE ABOVE SLIP PAD FOR COMPUTATION OF INCOME AND OFFERED RS. 158258.00 ON ACCOUNT OF IT. 8 ANNEXURE. A/EX-5: THIS IS THE SCHOOL NOTE BOOKS STATING CHEQUE TRANSA CTIONS & STATED IN THE REGULAR BOOKS OF ACCOUNTS. ANNEXURE-A/EX.6 : THIS IS THE NEEL GAGAN SLIP PAD CONTAINING PAGE 1 T O 7 HAS THE ROUGH WORKING. ANNEXURE-A/EX-7 & 9 : THIS IS THE NEEL GAGAN NOTE BOOK STATING DETAILS OF GOODS ISSUED TO & RECEIVED FROM 'KARIGAR' FOR MAKING OF JEWELLERY. LN THIS RESPECT, WE WOULD LIKE TO STATE HERE THAT WHILE COMPUTING THE INCOME FOR THE RELEVANT F.Y. 2006-200 7, THE ASSESSEE HAS ALREADY BEEN CONSIDERED THE ABOVE SLIP PAD FOR COMPUTATION OF IN COME AND SHOWN THE UNRECORDED PURCHASE OF RS. 442382.00 IN THE TRADING INCOME. ANNEXURE-A/EX-8 : THIS IS THE BANK DEPOSIT SLIP OF MANTRAM & AMRITYA EDUCATIONAL SOCIETY. FOR VERIFICATION OF THE ABOVE COPY OF BANK STATEMENT OF MANTRAM EDUC ATION SOCIETY IS PRODUCED HEREWITH. ANNEXURE.A/EX-10 : THIS IS THE GOLD ISSUE VOUCHER OF THE ASSESSEE & ST ATED IN THE REGULAR BOOKS OF ACCOUNTS. THE BILLS/VOUCHERS OF THE RESPECTIVE PARTY ARE ENCL OSED HEREWITH FOR YOUR KIND PERUSAL & VERIFICATION. ANNEXURE.A/EX-11 : THIS IS THE ISSUE BILL FOR MAKING OF JEWELLERY & ST ATED IN THE REGULAR BOOKS OF ACCOUNTS. ANNEXURE-A/EX-12 & 13: THIS IS THE ORDER FORM OF THE ASSESSEE, IN WHICH HE BOOK THE ORDER FOR NEW JEWELLERY BY EXCHANGE THE OLD JEWELLERY OF THE CUSTOMER & STATED IN THE REGULAR BOOKS OF ACCOUNTS AND ALREADY BEEN CONSIDERED IN THE WORKING OF STOCK VALUATION OF EXCESS GOLD STOCK FOUND DURING THE COURSE OF SURVEY. DETAILED WORKING OF ANNEXURE A/EX-7 & ANNEXURE A/EX -9 FOR VERIFICATION OF EXCESS UNDISCLOSED STOCK OF RS. 442382.00 SHOWN IN TRADING ACCOUNT IS PRODUCED HEREWITH FOR YOUR HONORS KIND PERUSAL & VERIFICATIO N. DETAILED WORKING OF ANNEXURE A/EX-4 FOR VERIFICATIO N OF EXCESS AMOUNT RECEIVED FROM CUSTOMERS AGAINST ORDERS OF RS. 158258.00 IS P RODUCED HEREWITH FOR YOUR HONORS KIND PERUSAL & VERIFICATION. BANKS & DEMAT ACCOUNTS OF THE ASSESSEE AND HIS FAMI LY MEMBERS FOR VERIFICATION & JUSTIFICATION OF THE ASSESSEE'S CLAIM IN THIS REG ARD IS PRODUCED HEREWITH FOR YOUR KIND PERUSAL & VERIFICATION. 9 WE ARE ALSO PRODUCING HEREWITH THE DETAILED WORKING AND BOOKS OF ACCOUNTS OF THE F,Y. 2005-2006 AND F.Y. 2006-2007 FOR YOUR KIND PERUSAL & VERIFICATION. LN RESPECT OF DIFFERENCE BETWEEN INCOME OFFERED OF RS. 32881.00 IN THE LT RETURN AS AGAINST THE INCOME OF RS. 18.00 LACS SURRENDERED ON ACCOUNT OF LOOSE PAPERS FOUND DURING THE COURSE OF SURVEY, WE WOULD LIKE TO STATE HERE THAT AT THE TIME OF SURVEY THE ASSESSEE MADE THE LUMP SUM SURRENDER OF RS. 18.00 L ACS ON ACCOUNT OF LOOSE PAPER FOUND, HOWEVER, EVERY TIME THE ASSESSEE STATED IN H IS STATEMENT THAT AT PRESENT HE IS NOT ABLE TO VERIFY THE DOCUMENTS HOWEVER, THE SAME WILL BE VERIFIED BY HIM IN LATER STAGES AND IF STILL SOME DOCUMENTS REMAIN UNACCOUNT ED, HE WILL OFFER THE SAME FOR TAX PURPOSES. HOWEVER, WHILE COMPUTING THE TOTAL INCOME FOR THE R ELEVANT F.Y. 2006-2007 & AFTER THOROUGH VERIFICATION OF THOSE LOOSE PAPERS, THE TR ANSACTION/ENTRIES, WHICH FOUND UNDISCLOSED OR STATED OUT OF THE REGULAR BOOKS OF A CCOUNTS, HAVE BEEN CONSIDERED FOR TAX PURPOSE BY THE ASSESSEE. ACCORDING TO THAT METICULO US WORKING OF THE LOOSE PAPERS, WHATEVER INCOME FOUND UNDISCLOSED HAVE BEEN OFFERED FOR TAX PURPOSE FOR THE RELEVANT F.Y. 2006-2007 AFTER TAKING THE CORRESPONDING CREDI T OF THE CREDIT TRANSACTIONS FOUND IN THE LOOSE PAPERS. UNDER THE ABOVE FACT & CIRCUMSTANCES OF THE ASSESSE E'S CASE, THE LD. ACIT HAS NOT JUSTIFY IN MAKING ARBITRARY ADDITION OF RS. 1768000.00 ON T HE BASIS OF STATEMENT RECORDED DURING THE COURSE OF SURVEY, THEREFORE, WE HUMBLY R EQUEST YOUR HONOUR TO ACCEPT OUR SUBMISSION AND IT WOULD BE A VERY KIND TO THE ASSES SEE FOR DELETING THE ADDITIONS OF RS. 1768000.00 MADE BY THE LD. ACIT. 4. LEARNED CIT(A) AFTER CONSIDERING THE SUBMISSIONS O F THE ASSESSEE OBSERVED THAT THE ASSESSEE HAD OFFERED ADDITIONAL I NCOME OF RS. 45,41,237/- INCLUDING RS. 32,000/- ON ACCOUNT OF VA RIOUS DEFECTS NOTICED BY THE SURVEY TEAM AND AFTER VERIFICATION OF VARIOU S LOOSE PAPERS FOUND AT THE TIME OF SURVEY. HE FURTHER OBSERVED THAT THE CO NTENTION OF THE ASSESSEE THAT MOST OF THE TRANSACTIONS MENTIONED IN THE LOOSE PAPERS WERE VERIFIED FROM THE BOOKS OF ACCOUNTS AND ONLY U NACCOUNTED TRANSACTION OF RS. 32,000/- WAS FOUND AND OFFERED F OR TAXATION, WHICH HAD BEEN REJECTED MERELY STATING THAT IT WAS GENERAL IN NATURE AND NOT 10 SUPPORTED BY ANY EVIDENCE. HOWEVER, THE ASSESSING OFFICER HAD NOT GIVEN ANY BASIS IN REACHING SUCH A CONCLUSION AND HAD NOT GIVEN EVEN A SINGLE INSTANCE OF TRANSACTION NOTED IN THE LOOSE PAPERS A ND CLAIMED BY THE ASSESSEE AS RECORDED IN THE BOOKS OF ACCOUNTS, WHIC H WAS NOT CORRECTLY RECORDED AND THE ASSESSEE HAD DELIBERATELY RETRACTE D BACK FROM THE SURRENDER TO AVOID THE TAX LIABILITY. AS REGARDS, SURRENDER MADE IN THE STATEMENT RECORDED AT THE TIME OF SURVEY, THE LEARN ED CIT(A) OBSERVED THAT THE ASSESSEE HAD MADE THE SURRENDER CONDITIONA LLY THAT THE TRANSACTIONS NOTED IN THE LOOSE PAPERS WERE VERIFIA BLE FROM THE BOOKS OF ACCOUNT AND ON VERIFICATION IF THE TRANSACTIONS NOT ED IN THE LOOSE PAPERS WERE FOUND UNRECORDED IN THE BOOKS OF ACCOUNT, THEN HE WOULD OFFER INCOME OF RS. 18 LAC FOR TAXATION. HOWEVER, ON VER IFICATION IT WAS FOUND THAT THERE WAS ONLY TRANSACTION OF RS. 32,000/- WHI CH WAS NOT RECORDED IN THE BOOKS OF ACCOUNT. THE LEARNED CIT(A) TO VERIF Y THE CONTENTION OF THE ASSESSEE THAT THE TRANSACTION FOUND RECORDED IN THE LOOSE PAPERS WERE RECORDED IN THE BOOKS OF ACCOUNT HAD MADE TEST CHEC K OF FEW OF THE ENTRIES AND FOUND THOSE RECORDED IN THE LOOSE PAPER S WITH REFERENCE TO THE BOOKS OF ACCOUNT PRODUCED. THE SAID ENTRIES HA S BEEN MENTIONED BY LEARNED CIT(A) AT PAGE 12 OF THE IMPUGNED ORDER, FO R THE COST OF REPETITION, THESE ARE NOT REPRODUCED HEREIN. LEARN ED CIT(A) HELD THAT 11 THE ASSESSING OFFICER HAD NOT BROUGHT ANY MATERIAL OR EVIDENCE ON RECORD TO CONTRADICT THE SUBMISSIONS OF THE ASSESSEE AND T HAT THE ADDITION MADE WAS PURELY ON THE BASIS OF STATEMENT GIVEN IN A STA TE OF CONFUSION AND WITHOUT ANY EVIDENCE REGARDING UNDISCLOSED INCOME A ND LATER RETRACTED WITH EVIDENCE, THEREFORE, IT COULD NOT BE SUSTAINED . RELIANCE WAS PLACED ON THE DECISION OF ITAT AHMADABAD BENCH IN THE CASE OF DCIT VS. PRAMUKH BUILDERS [112 ITD 179 (2008) DTR 166] . ACCORDINGLY, ADDITION MADE BY THE ASSESSING OFFICER WAS DELETED. NOW, TH E DEPARTMENT IS IN APPEAL. 5. LEARNED D.R. STRONGLY SUPPORTED THE ASSESSMENT OR DER PASSED BY THE ASSESSING OFFICER AND SUBMITTED THAT THE ASSES SEE DID NOT DISCLOSE THE INCOME IN THE RETURN OF INCOME, WHICH WAS OFFER ED FOR TAXATION IN HIS STATEMENT RECORDED AT THE TIME OF SURVEY. 6. IN HIS RIVAL SUBMISSIONS, LEARNED COUNSEL FOR THE A SSESSEE REITERATED THE SUBMISSION MADE BEFORE THE AUTHORITIES BELOW AN D FURTHER SUBMITTED THAT THE ENTRIES, WHICH WERE NOT FOUND RECORDED IN THE BOOKS OF ACCOUNTS AND WERE MENTIONED IN THE LOOSE PAPERS FOUND DURING THE COURSE OF SURVEY WERE CONSIDERED WHILE OFFERING AN INCOME OF RS. 32,000/- FOR TAXATION AND SINCE NO OTHER ENTRY WAS THERE, THEREF ORE, THE ASSESSEE RETRACTED AND ONLY OFFERED THAT INCOME, WHICH WAS N OT RECORDED IN THE 12 BOOKS OF ACCOUNTS. IT WAS ALSO STATED THAT THE ASS ESSEE HIMSELF SUO MOTU HAD ALREADY OFFERED ADDITIONAL INCOME OF RS. 45,41, 237/- AND THE RETRACTION WAS BASED ON EVIDENCE, THEREFORE, THE LE ARNED CIT(A) WAS FULLY JUSTIFIED IN DELETING THE ADDITION MADE BY TH E ASSESSING OFFICER. 7. WE HAVE CONSIDERED THE SUBMISSIONS OF BOTH THE PAR TIES AND CAREFULLY GONE THROUGH THE MATERIAL AVAILABLE ON RE CORD. IN THE PRESENT CASE, IT IS AN ADMITTED FACT THAT DURING THE COURSE OF SURVEY, CERTAIN LOOSE PAPERS/DOCUMENTS WERE FOUND, WHICH CONTAINED SOME E NTRIES, WHICH WERE NOT RECORDED IN THE BOOKS OF ACCOUNTS AND THE ASSESSEE OFFERED A SUM OF RS. 18 LAC FOR TAXATION. HOWEVER, LATER ON, WHEN THE ENTRIES RECORDED IN THE BOOKS OF ACCOUNTS VIS-A-VIS MENTIONED IN THE LOOSE PAPERS FOUND DURING THE SURVEY, WERE CHECKED/CONSIDERED, T HE ONLY ENTRIES FOR A SUM OF RS. 32,000/- WERE FOUND UNRECORDED, THIS FAC T WAS ALSO VERIFIED BY THE LEARNED CIT(A) HIMSELF. THEREFORE, THE RETRACT ION MADE BY THE ASSESSEE WAS BASED ON THE EVIDENCE AND IT WAS NOT A MERE RETRACTION FROM ALREADY SURRENDERED AMOUNT. IN THE PRESENT CA SE, IT IS ALSO NOTICED THAT THE ASSESSEE HAD OFFERED AN ADDITIONAL INCOME OF RS. 45,41,237/-, WHICH INCLUDED RS. 32,118/- ON ACCOUNT OF ENTRIES F OUND IN LOOSE PAPERS. IN THE INSTANT CASE, THE ASSESSING OFFICER WHILE MA KING THE ADDITION OF RS. 17.68 LAC., DID NOT BRING ANY EVIDENCE OR DOCUMENT ON RECORD TO JUSTIFY 13 THE SAID ADDITION. ON THE CONTRARY, THE ASSESSEE E XPLAINED THE ENTRIES FOUND IN THE LOOSE PAPERS AND RECORDED IN THE BOOKS OF ACCOUNTS, WHICH WERE ALSO VERIFIED BY THE LEARNED CIT(A) ON TEST CH ECK BASIS AND ONLY ENTRIES AMOUNTING TO RS. 32,118/- WERE FOUND UNRECO RDED, WHICH THE ASSESSEE HAD ALREADY OFFERED FOR TAXATION WHILE FIL ING HIS RETURN OF INCOME. THEREFORE, IN OUR OPINION, LEARNED CIT(A) WAS JUSTIFIED IN DELETING THE IMPUGNED ADDITION. WE DO NOT SEE ANY MERIT IN THIS APPEAL OF THE DEPARTMENT. 8 . IN THE RESULT, APPEAL OF THE DEPARTMENT IS DISMIS SED. (ORDER PRONOUNCED IN THE COURT ON 27 TH SEPTEMBER, 2013). SD/- SD/- (HARI OM MARATHA) (N.K.SAINI) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED : 27 TH SEPTEMBER, 2013. VR/- COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE LD.CIT 4. THE CIT(A) 5. THE D.R ASSISTANT REGISTRAR, ITAT, JODHPUR.