Asstt. Commissioner of Income tax, Jalandhar V. Sh. Dharam Vir, Ludhiana

ITA 47/ASR/2003

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 5829 (ITAT-AMRITSAR)
• Duration Of Justice: 8 year(s) 4 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-06-2011
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 14-12-2010
• Assessment Year: 1995-1996
• Appeal Filed On: 27-01-2003
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: TARSEM LAL BHARTI
• Assessee Lawyers: BHAGAT ITP
• Keywords: Unexplained investment; Search and seizure; Loose papers
• Section: 143(3); 142(1); 131; 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH; AMRITSAR. BEFORE SH. H.L. KARWA, VICE PRESIDENT AND SH. MEHAR SINGH, ACCOUNTANT MEMBER I.T.A. NOS. 46 & 47(ASR)/2003 ASSESSMENT YEARS:1994-95 & 1995-96 PAN : THE ASSISTANT COMMISSIONER OF INCOME TAX, VS. S H. DHARAMBIR, RANGE-IV, JALANDHAR. 2205, KRISHNA NAGAR, JALANDHAR. (APPELLANT) (RESPONDENT) C.O. NO.32(ASR)/2005 (ARISING OUT OF ITA NO.47(ASR)/2003) ASSESSMENT YEAR: 1995-96 SH. DHARAMBIR, VS. ASSTT. COMMR. OF INCOME-TAX, LUDHIANA. RAGE-IV, JALANDHAR. (APPELLANT) (RESPONDENT) DEPARTMENT BY: SH. TARSEM LAL BHARTI, DR ASSESSEE BY: SH. M.R. BHAGAT, ITP ORDER PER MEHAR SINGH, AM, THESE TWO APPEALS FILED BY THE REVENUE AND ONE C. O. BY THE ASSESSEE ARE DIRECTED AGAINST DIFFERENT ORDERS OF THE CIT(A) -I, LUDHIANA, EACH DATED 01.10.2002 PASSED UNDER SECTION 250(6) OF THE INCOM E-TAX ACT, 1961 (HEREINAFTER REFERRED TO IN SHORT THE ACT), FOR T HE ASSESSMENT YEARS 1994-95 & 1995-96. 2 2. FIRST, WE WILL TAKE UP APPEAL IN ITA NO.46(ASR)/ 2003, WHERE THE REVENUE HAS RAISED THE FOLLOWING GROUNDS: 1. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF T HE CASE THE LD. CIT(A) HAS ERRED IN DELETING THE ADDITION OF RS.20, 18,000/- MADE BY THE A.O. ON ACCOUNT OF UNEXPLAINED INVESTME NT IN THE PURCHASE OF DRAFTS IN BENAMI NAMES DESPITE THE CONT RADICTORY STATEMENTS MADE AT THE TIME OF SEARCH AND DURING TH E COURSE OF ASSESSMENT PROCEEDINGS. 2. THAT THE LD. CIT(A) HAS WRONGLY INTERPRETED THE DECISION OF HONBLE ALLAHABAD HIGH COURT IN THE CASE OF PUSHKAR NARAIN SARAFT VS. CIT (1990) 183 ITR 388 (ALL.) 3. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE THE LD. CIT(A) HAS ERRED IN DELETING THE ADDITION OF RS.10,16,000/ - ON ACCOUNT OF 15 UNEXPLAINED ENTRIES IN THE IMPOUNDED LEDGERS PERTAINING TO PAKHOWAL VEND OF THE ASSESSEE. 4. THAT AGAIN ON THE FACTS AND CIRCUMSTANCES OF THE CASE THE LD. CIT(A) HAS ERRED IN DELETING THE ADDITION OF RS.800 0/- ON ACCOUNT OF LOW HOUSEHOLD EXPENSES. 5. THAT FURTHER ON THE FACTS AND IN THE CIRCUMSTANC ES OF THE CASE, THE LD. CIT(A) WAS NOT JUSTIFIED IN DELETING THE AD DITION OF RS.2,16,550/- MADE BY THE AO ON ACCOUNT OF UNEXPLAI NED INVESTMENT IN THE PURCHASE OF SHOP IN A.C. MARKET, LUDHIANA, IN THE NAMES OF SH. SAT PAL SON OF THE ASSESSEE AND SM T. SATYA DEVI WIFE OF SH. SUNDER LAL WHO WERE FOUND TO BE BE NAMIDARS OF THE ASSESSEE AND HAD NO INDEPENDENT SOURCE OF IN COME OF THEIR OWN. 6. THAT IT IS PRAYED THAT THE ORDER OF THE LD. CIT( A) BE SET-ASIDE AND THAT OF THE A.O. BE RESTORED. 7. THAT THE APPELLANT REQUESTS FOR LEAVE TO ADD OR AMEND OR ALTER THE GROUNDS OF APPEAL BEFORE THE APPEAL IS HEARD A ND DISPOSED OFF. 3. IN THE COURSE OF PRESENT APPELLATE PROCEEDINGS, BOTH THE LD. DR AS WELL AS THE LD. COUNSEL FOR THE ASSESSEE CONCEDED THAT GROUND NOS. 1 & 2 RAISED IN THE APPEAL OF THE REVENUE ARE SQUARELY CO VERED BY THE DECISION OF THE ITAT, AMRITSAR BENCH, DATED 27 TH NOV.,2008, PASSED IN ITA NOS.42 & 43(ASR)/2003 FOR THE ASSESSMENT YEAR 1993-94 & 1994 -95 IN THE CASE OF 3 ACIT, R-IV, JALANDHAR VS. SH. BALDEV SINGH AND IN ITA NO.45(ASR)/2003 FOR THE ASSESSMENT YEAR 1993-94 IN ASSESSEES OWN C ASE. THE RELEVANT FINDINGS GIVEN BY THE ITAT, IN PARA 12.1 OF THE A FORESAID ORDER ARE REPRODUCED HEREUNDER: 12. THE THIRD GROUND IS REGARDING DELETION OF ADDI TION OF RS.24,12,740/- BY THE LD. CIT(A) ON ACCOUNT OF UNDI SCLOSED INVESTMENT IN THE PURCHASE OF DEMAND DRAFTS. THE BR IEF FACTS OF THE CASE ARE THAT THE A.O. MADE THE ADDITION FOR NOT FU RNISHING COMPLETE EVIDENCE BY THE ASSESSEE REGARDING THE SOURCES FROM WHICH THOSE DRAFTS WERE PURCHASED. ON APPEAL, THE LEARNED CIT(A ) DELETED THE ADDITION ON THE REASON THAT PURCHASER OF DEMAND DR AFTS S/SH. HANS RAJ, PRAN NATH, SAT PAL AND SH. ROSHAN LAL FILED CONFIRMATIONS LETTERS AND SH. KASHMIRI LAL CONFIRMED OF GIVING A N AMOUNT OF RS.70,000/- BEFORE THE AO. HENCE, THE LD. CIT(A) DE LETED THE SAME. 12.1. WE HAVE HEARD BOTH THE PARTIES AND CONSIDERE D THE RIVAL SUBMISSIONS WITH REFERENCE TO FACTS, EVIDENCE AND M ATERIAL PLACED ON RECORD. WE FIND THAT IN THIS CASE, THERE WERE VARIO US BENEFICIARIES AND DEPOSITORS. WE DIRECT THE A.O. TO CONSIDER ONLY DEM AND DRAFTS WHERE THE ASSESSEE IS A BENEFICIARY OR DEPOSITOR AND THE BALANCE DRAFTS CANNOT BE CONSIDERED IN THE HAND OF THE ASSESSEE WHERE AS SESSEE IS NEITHER BENEFICIARY NOR DEPOSITOR. THIS GROUND OF APPEAL OF THE REVENUE IS PARTLY ALLOWED. 4. HAVING HEARD THE SUBMISSIONS OF RIVAL PARTIES A ND CONSIDERING THE RELEVANT MATERIAL PLACED ON RECORD, WE ARE OF THE C ONSIDERED OPINION THAT THE ISSUE RAISED IN GROUND NO.1 & 2 BY THE REVENUE IS SQUARELY COVERED BY THE ORDER OF THE ITAT, AMRITSAR BENCH, DATED 27 TH NOV.,2008, PASSED IN ITA NOS.42 & 43(ASR)/2003 FOR THE ASSESSMENT YEAR 1993- 94 & 1994-95 IN THE CASE OF ACIT, R-IV, JALANDHAR VS. SH. BALDEV SINGH AND IN ITA NO.45(ASR)/2003 FOR THE ASSESSMENT YEAR 1993-94 IN ASSESSEES OWN CASE. THUS, THE FINDINGS GIVEN THEREIN SHALL APPLY EQUALL Y, MUTATIS MUTANDIS TO 4 THESE GROUNDS. ACCORDINGLY, WE DISMISS THESE GROUND S OF APPEAL OF THE REVENUE. 5. IN GROUND NO.3, THE REVENUE CONTENDED THAT THE LD. CIT(A) HAS ERRED IN DELETING THE ADDITION OF RS.10,16,000/- ON ACCOU NT OF 15 UNEXPLAINED ENTRIES IN THE IMPOUNDED LEDGERS PERTAINING TO PAKH OWAL VEND OF THE ASSESSEE. THE BRIEF FACTS OF THE ISSUE IN QUESTION ARE THAT SEARCH UNDER SECTION 132(1) OF THE ACT, WAS CARRIED AT THE RESIDENCE OF THE ASSESSEE ON 15.9.1994 AND CERTAIN INCRIMINATING DOCUMENTS AND OTHER MATER IAL WERE FOUND AND SEIZED. AFTER EXAMINING THE SAME, THE AO MADE AN AD DITION OF RS.10,16,000/- . ON APPEAL, THE LD. CIT(A), DELETED THE ENTIRE ADDITION. 5.1 THE LD. DR STRONGLY RELIED ON THE ORDER OF TH E ASSESSING OFFICER. 5.2. THE LD. COUNSEL FOR THE ASSESSEE, ON THE OTHER HAND, RELIED ON THE ORDER OF THE CIT(A). 6. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND GON E THROUGH THE MATERIAL AND EVIDENCE AVAILABLE ON RECORD, INCLUDIN G THE ORDERS OF THE AUTHORITIES BELOW. AFTER GOING THROUGH THE ORDER OF THE CIT(A), WE ARE OF THE CONSIDERED VIEW THAT THE LD. CIT(A), HAS RIGHTLY DE LETED THE ADDITION, WHICH WAS MADE BY THE A.O., WITHOUT APPRECIATING THE FACT S, IN THE RIGHT PERSPECTIVE. WE THEREFORE, DO NOT FIND ANY VALID RE ASON TO INTERFERE WITH THE FINDINGS OF THE LD. CIT(A), WHICH ARE REPRODUCED AB OVE. ACCORDINGLY, WE UPHOLD THE SAME AND DISMISS THIS GROUND OF APPEAL O F THE REVENUE. 7. THE FOURTH GROUND OF APPEAL RELATES TO DELETION OF ADDITION OF RS.8,000/- ON ACCOUNT OF LOW HOUSEHOLD EXPENSES. BR IEFLY STATED, THE FACTS OF THE CASE ARE THAT THE ASSESSEE HAS MADE HOUSEHOLD W ITHDRAWALS OF RS.24,000/- FROM HIS CAPITAL ACCOUNT WITH M/S. SUND ER LAL & CO. @ 5 RS.2000/- PER MONTH. HE IS MAINTAINING A FAMILY OF 6 MEMBERS. SOME CHILDREN ARE SCHOOL AND COLLEGE GOING. HOWEVER, KEE PING IN VIEW ALL THE FACTS OF HIS FAMILY IN MIND THE A.O. ESTIMATED THE HOUSEHOLD EXPENSES AT RS.40,000/- AND MADE AN ADDITION OF RS.16,000/-. ON APPEAL, THE LD. CIT(A), REDUCED THE ADDITION TO RS.8000/-. NOW AGG RIEVED WITH THE ORDER OF THE CIT(A), THE REVENUE IS IN APPEAL BEFORE US. 7.1. THE LD. DR, VEHEMENTLY RELIED ON THE ORDER O F THE CIT(A). 7.2. THE LD. COUNSEL FOR THE ASSESSEE, ON THE OTHER HAND, SUPPORTED THE ORDER OF THE CIT(A). 8. WE HAVE GIVEN OUR THOUGHTFUL CONSIDERATION TO TH E RIVAL SUBMISSIONS AND GONE THROUGH THE ORDERS OF THE AUTHORITIES BELO W. WE ARE OF THE CONSIDERED OPINION THAT THE LD. CIT(A), WAS JUSTIFI ED IN REDUCING THE ADDITION WHICH WAS MADE ON ESTIMATED BASIS. THE REL EVANT FINDINGS GIVEN BY THE LD. CIT(A) ARE REPRODUCED HEREUNDER: SINCE THE ADDITION HAS BEEN MADE ON AN ADHOC BASIS , I CONSIDER IT JUST AND REASONABLE TO PEG THE DISALLOWANCE AT R S.8,000/- ONLY. THE APPELLANT THEREFORE, GETS A RELIEF OF RS. 8,000/- ON THIS GROUND. IN VIEW OF THE ABOVE, WE DO NOT FIND ANY INFIRMITY IN THE FINDINGS OF THE CIT(A), AS THE SAME HAVE BEEN ARRIVED AFTER PROPER APPRECIATION OF THE FACTUAL POSITION OF THE CASE. ACCORDINGLY, THIS GRO UND OF APPEAL OF THE REVENUE IS DISMISSED. 9. THE NEXT GROUND OF APPEAL RELATES TO DELETION OF ADDITION OF RS.2,16,550/- ON ACCOUNT OF UNEXPLAINED INVESTMENT IN THE PURCHASE OF SHOP IN A.C. MARKET. AT THE TIME OF HEARING, BOTH THE LD . DR AND LD. COUNSEL 6 FOR THE ASSESSEE CONCEDED THAT THIS ISSUE IS SQUARE LY COVERED BY THE DECISION OF THE ITAT AMRITSAR BENCH, DATED 27 TH NOV., 2008, IN THE CASE OF ACIT RANGE-IV, JALANDHAR VS. SH. BALDEV RAJ, JALANDHAR P ASSED IN ITA NOS. 42 & 43(ASR)2003 FOR THE ASSESSMENT YEARS 1993-94 & 1994 -95. 10. HAVING HEARD BOTH THE PARTIES, WE FIND THAT THE ISSUE IN DISPUTE HAS ALREADY BEEN DECIDED BY THE ITAT, AMRITSAR BENCH, V IDE ITS ORDER DATED 27 TH NOV., 2008, IN THE CASE OF ACIT RANGE-IV, JALANDHAR VS. SH. BALDEV RAJ, JALANDHAR, PASSED IN ITA NOS. 42 & 43(ASR)2003 FOR THE ASSESSMENT YEARS 1993-94 & 1994-95. THE RELEVANT FINDINGS GIVEN BY T HE ITAT ARE REPRODUCED HEREUNDER: 16.1. HAVING HEARD BOTH THE PARTIES, WE FIND THAT THIS INVESTMENT WAS MADE BY THE ASSESSEE IN THE NAMES OF SH. SAT PAL, SMT. SATYA DEVI WIFE OF SH. SUNDER LAL, SH. HANS RAJ & PAWAN KUMAR. THE AO HAS TAKEN PROPORTIONATE INVESTMENT MADE IN THE NAMES OF TWO SONS OF THE ASSESSEE AT RS. 2,16,550/-. THE CONTENTION OF THE A SSESSEE IS THAT THE AO OVER-LOOKED THE SALE-DEED AND TAKEN THE VALUATIO N AS PER SEIZED DOCUMENT PROCURED FROM THE RESIDENCE OF THE ASSESSE ES BROTHER. THE AO IN THIS CASE HAS NOT EXAMINED THE SELLER FROM WH OM THE ASSESSEE HAS PURCHASED THE PROPERTY. THE ADDITION HAS BEEN M ADE ON THE BASIS OF SURMISES AND CONJECTURES, WHICH IS NOT PROPER. HENCE, IN OUR OPINION, THE LEARNED CIT(A) WAS JUSTIFIED IN DELETI NG THE ADDITION. THE FINDINGS GIVEN BY THE LD. CIT(A) ARE AS UNDER: 7.1. THE LD. COUNSELS HAVE BEEN OPPOSED THE SAID A DDITION BY CONTENDING THAT THE SON OF THE APPELLANT HAD PURCHA SED ONE SHOP AT AC MARKET, GHUMAR MANDI, LUDHIANA, AND THE PRICE OF THE SHOP MENTIONED IN THE REGISTERED DEED WAS RS.1,80,0 00/- ONLY. INSTEAD OF RELYING ON THE PRICE DECLARED IN THE REG ISTERED DEED AS CORRECT, THE AO CONSIDERED SOME FIGURES MENTIONE D IN THE LOOSE PAPERS SEIZED FROM THE RESIDENCE OF THE BROTH ER OF THE APPELLANT, TO HOLD THAT THE SHOP WAS PURCHASED FOR A SUM OF 7 RS.6,49,000/-.THE LD. COUNSELS HAVE CITED THE JUDG MENT OF THE HONBLE ITAT, CHANDIGARH BENCH, CHANDIGARH, IN THE CASE OF BALDEV KRISHAN KAPOOR VS. ACIT (1999) 69 ITD 27, WH ERE IT WAS HELD THAT THE PRICE RECORDED IN THE SALE DEED I S PRESUMED TO BE THE CORRECT PRICE AS THE SALE DEED WAS DULY REGI STERED, AND THERE IS A PRESUMPTION OF CORRECTNESS OF THE PRICE STATED THEREIN. FURTHER, RELIANCE WAS PLACED ON THE RATIO OF HONBL E PUNJAB & HARYANA HIGH COURT IN THE CASE OF CIT VS. SATINDER KUMAR (2001) 250 ITR 484, WHEREIN IT HAS WAS HELD, NO MA TERIAL EVIDENCE TO ESTABLISH THAT ASSESSEE MADE INVESTMENT OVER THE RECORDED IN SALE DEED WAS FOUND AND DELETED THE AD DITION. I HAVE EXAMINED THE MATTER CAREFULLY. I FIND THAT NO PROPER ENQUIRIEIS WERE MADE FROM THE SELLER OF THE SHOPS O R FROM OTHER PERSONS WHO ALSO PURCHASED THE SHOPS IN THE MARKET . EVEN THE PRESUMPTION U/S 132(4A) IS NOT APPLICABLE IN THIS CASE AS THE LOOSE PAPER WAS NOT SEIZED FROM THE RESIDENCE OF T HE APPELLANT. I AM, THEREFORE, INCLINED TO AGREE WITH THE SUBMI SSIONS OF THE LD. COUNSELS THAT THERE WAS NO CLINCHING EVIDENCE WITH A.O. FOR MAKING THE SAID ADDITION. I, THEREFORE, DIRECT THE AO TO DELETE THIS ADDITION. IN VIEW OF THE ABOVE, WE CONFIRM THE ORDER OF THE L D. CIT(A). AND THIS GROUND OF APPEAL OF THE REVENUE IS DISMISSED. RESPECTFULLY, FOLLOWING THE ABOVE FINDINGS OF THE ITAT, AMRITSAR BENCH, WE DISMISS THIS GROUND OF APPEAL OF THE REVENUE. 11. GROUND NOS. 6 & 7 ARE GENERAL IN NATURE, HENCE NEED NO ADJUDICATION AND THE SAME ARE DISMISSED. 12. NOW, WE SHALL DEAL WITH APPEAL IN ITA NOL.47(AS R)/2003 FOR THE ASSESSMENT YEAR 1995-96, WHERE THE REVENUE HAS RAIS ED FOLLOWING GROUNDS: 1. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF T HE CASE THE LD. CIT(A) HAS ERRED IN DELETING THE ADDITION OF RS.2,7 0,640/- MADE BY THE A.O. ON ACCOUNT OF UNEXPLAINED CASH FOUND AT THE TIME OF SEARCH. 8 2. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE THE LD. CIT(A) HAS ERRED IN DELETING THE ADDITION OF RS.40,000 MAD E BY THE A.O. IN THE HANDS OF THE ASSESSEE ON ACCOUNT OF HOU SEHOLD EXPENSES. 3. THAT AGAIN ON THE FACTS AND CIRCUMSTANCES OF THE CASE THE LD. CIT(A) HAS ERRED IN DELETING THE ADDITION OF RS.2,1 5,300/- MADE BY THE AO ( I.E. UNEXPLAINED INVESTMENT OF RS.65,3 00 IN THE HANDS OF THE ASSESSEE AND UNEXPLAINED INVESTMENT OF RS.1,50,000/- IN THE NAME OF ASSESSEES SON SH. SA TPAL, WHO HAS BEEN HELD AS BENAMIDAR OF THE ASSESSEE FOR THE ASSESSMENT YEARS 1993-94 & 1994-95 ON ACCOUNT OF UNEXPLAINED INVESTMENT IN THE FIRM M/S. DHARAMVIR BALDEV KRISHA N. 4. THAT FURTHER ON THE FACTS AND IN THE CIRCUMSTANC ES OF THE CASE, THE LD. CIT(A) WAS NOT JUSTIFIED IN DELETING THE A DDITION OF RS.2,16,550/- MADE BY THE A.O. ON ACCOUNT OF UNEXPL AINED INVESTMENT IN THE PURCHASE OF SHOP IN A.C. MARKET, LUDHIANA IN THE NAMES OF SH. SAT PAL SON OF THE ASSESSEE AND SM T. SATYA DEVI WIFE OF SH. SUNDER LAL WHO WERE FOUND TO BE BE NAMIDARS OF THE ASSESSEE AND HAD NO INDEPENDENT SOURCE OF IN COME OF THEIR OWN. 5. THAT AGAIN ON THE FACTS AND CIRCUMSTANCES OF THE CASE THE LD. CIT(A) HAS ERRED IN DELETING THE ADDITION OF RS10,7 0,000/- MADE BY THE A.O. IN THE HANDS OF THE ASSESSEE ON AC COUNT OF UNDISCLOSED INVESTMENT AND PROFIT IN BENAMI CONCERN NAMELY M/S. N.S.SIDHU & CO. 6. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF T HE CASE, THE LD. CIT(A) WAS NOT JUSTIFIED IN DELETING THE ADDITION O F RS.1,58,638/- MADE BY THE AO IN THE HANDS OF THE AS SESSEE ON ACCOUNT OF UNEXPLAINED ENTRIES IN THE NAMES OF N.S .SIDHU, H.S. SIDHU AND K.S. SIDHU APPEARING AT PAGE 70 OF THE LE DGER NO.4 IMPOUNDED U/S 131(3) OF THE ACT. 7. THAT IT IS PRAYED THAT THE ORDER OF THE LD. CIT( A) BE SET-ASIDE AND THAT OF THE A.O. BE RESTORED. 8. THAT THE APPELLANT REQUESTS FOR LEAVE TO ADD OR AMEND OR ALTER THE GROUNDS OF APPEAL BEFORE THE APPEAL IS HEARD A ND DISPOSED OFF. 13. IN THE FIRST GROUND OF APPEAL, THE REVENUE CONT ENDED THAT THE LD. CIT(A) ERRED IN DELETING THE ADDITION OF RS.2,70,64 0/- MADE BY THE A.O. ON 9 ACCOUNT OF UNEXPLAINED CASH FOUND AT THE TIME OF SE ARCH. THE BRIEF AND NEAT FACTS OF THE CASE ARE THAT DURING THE COURSE OF SEA RCH AT THE RESIDENTIAL PREMISES OF THE ASSESSEE, A CASH OF RS.2,70,640/- W AS FOUND OUT OF WHICH RS.2,50,000 WAS SEIZED. THE ASSESSEE EXPLAINED THE SOURCE OF THUS AMOUNT OF RS.2,70,640/- AS BELONGING TO HIS BUSINESS . HE FUR THER STATED THAT RS.2.50 LAC WAS BROUGHT TO THE RESIDENCE ABOUT 15 DAYS BACK AND THE BALANCE IS THE SALE PROCEEDS. THE PHOTOCOPIES OF THE RELEVANT PAGE OF T HE CASH BOOK, INCLUDING BALANCE SHEET AND PROFIT & LOSS A/C WERE SUBMITTED . THE AO AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE MADE AN ADDITION OF RS.2,70,640/-. ON APPEAL, THE ADDITION WAS DELETED BY THE CIT(A). AGGRIEVED WITH THE ORDER OF THE CIT(A), THE REVENUE IS IN APPEAL BEFORE US. 13.1. THE LD. DR RELIED ON THE ORDER OF THE ASSES SING OFFICER. 13.2. THE LD. COUNSEL FOR THE ASSESSEE RELIED ON TH E ORDER OF THE CIT(A). 13.3. WE HAVE HEARD BOTH THE PARTIES AND CAREFULLY PERUSE D THE FACT SITUATION OF THE CASE AND RELEVANT RECORD . WE HAV E ALSO GONE THROUGH THE ORDER OF THE LD. CIT(A) AND FOUND THAT THE LD. CIT( A) HAS PASSED A DETAILED AND WELL REASONED ORDER ON THE ISSUE, WHICH DOES NO T REQUIRE ANY INTERFERENCE. THE RELEVANT FINDINGS GIVEN BY THE C IT(A), ARE REPRODUCED HEREUNDER: 2.3. I HAVE EXAMINED THE MATTER AND GONE THROUGH T HE ARGUMENTS OF THE LD. COUNSELS, AND ALSO PERUSED THE EVIDENCE PRO DUCED BEFORE ME. IT IS SEEN THAT A SUM OF RS.2,50,000/- APPEARS ON T HE ASSET SIDE OF THE BALANCE SHEET OF THE FIRM M/S. DHARAMBIR BALDEV KRI SHAN WITH THE NARRATION WITH THE I.T. DEPARTMENT RS.2,50,000/-. THIS EVIDENCE PROVES THAT THE CASH OF RS.2,50,000/- BELONGED TO T HE FIRM M/S. DHARAMBIR BALDEV KRISHAN, DHANDARI KALAN, LUDHIANA, WHICH THE 10 APPELLANT HAD BROUGHT TO HIS RESIDENCE. THEREFORE, IT SEEMS THAT THE A.O. WAS NOT JUSTIFIED IN IGNORING THE EXPLANATIONS SUBMITTED BEFORE HIM, PARTICULARLY WHEN THE ASSESSMENT OF THE FIRM, M/S. DHARAMBIR BALDEV KRISHAN, DHANDARI KALAN, LUDHIANA WAS COMPLE TED U/S 143(3) BY THE ACIT, CIRCLE PATIALA, AND HAD ACCEPTED THEIR ACCOUNTS. THE EXPLANATION REGARDING THE BALANCE CASH OF RS.20,000 /- FROM THE PAST SAVINGS OF THE FMILY CAN ALSO BE SAID TO BE QUITE P LAUSIBLE. SINCE THE AMOUNT INVESTED IS SMALL. ACCORDINGLY, I HOLD THAT THE ADDITION OF RS.2,70,000/- IS INCAPABLE OF BEING SUSTAINED AND I S DELETED HEREBY. 13.4. IN VIEW OF THE ABOVE, WE DO NOT FIND ANY INFI RMITY IN THE FINDINGS OF THE CIT(A), AS THE SAME HAVE BEEN ARRIVED AFTER PRO PER APPRECIATION OF THE LEGAL AND FACTUAL POSITION OF THE CASE. ACCORDINGLY , THIS GROUND OF APPEAL OF THE REVENUE IS DISMISSED. 14. IN THE NEXT GROUND OF APPEAL, THE REVENUE CONTE NDED THAT THE CIT(A) ERRED IN DELETING THE ADDITION OF RS.40,000/- MADE ON ACCOUNT OF HOUSEHOLD EXPENSES. THE BRIEF FACTS OF THE CASE ARE THAT IN T HE COURSE OF SEARCH SOME COSTLY DOMESTIC USE ARTICLES WERE FOUND VIZ. REFRIG ERATOR, SOFA-SET, COLOUR TV, ONE DEWAN WITH SOFA, SUNMICA COVERING OF TWO CU P BOARDS AND DOUBLE BEDS WITH BOXES AND FANCY BACK.. THE AO ESTIMATED THE COST OF THESE ITEMS AT RS.50,000/-. HOWEVER, THE AO GAVE RELIEF OF RS.1 0,000/- AND MADE THE ADDITION TO THE EXTENT OF RS.40,000/-. ON APPEAL, T HE LD. CIT(A), DELETED THE ENTIRE ADDITION. NOW, THE REVENUE IS IN APPEAL BEF ORE US. 14.1. THE LD. DR, RELIED ON THE ORDER OF THE A.O. 14.2. THE LD. COUNSEL FOR THE ASSESSEE, ON THE OTHE R HAND, RELIED ON THE ORDER OF THE CIT(A). 15. HAVING HEARD BOTH THE PARTIES AND PERUSING THE MATERIAL ON RECORD, INCLUDING THE ORDERS, OF THE AUTHORITIES BELOW, WE ARE OF THE CONSIDERED VIEW 11 THAT THE LD. CIT(A) WAS JUSTIFIED IN DELETING THE A DDITION OF RS.40,000/- ON ACCOUNT OF HOUSEHOLD EXPENSES. THE RELEVANT FINDING S GIVEN BY THE CIT(A) IN HIS ORDER ARE REPRODUCED HEREUNDER: 3.3. CONSIDERING THE FACTS OF THE CASE, I AM INCLI NED TO AGREE WITH THE AVERMENTS OF THE LD. COUNSELS FOR THE APPELLANT . THE CUP BOARDS ARE PART OF THE BUILDING AND TO THE OTHER HOUSEHOLD ITEMS ARE ROUTINE AND ORDINARY. THERE IS NOTHING EXTRAVAGANT AND NO A BNORMAL EXPENDITURE ON ANY COSTLY ITEMS I.E. AIR-CONDITIONE R, IMPORTED TV ETC. WAS FOUND OUT BY THE SEARCH PARTY DURING THE RAID. UNDER THESE CIRCUMSTANCES, I HOLD THAT NO ADDITION ON ACCOUNT O F UNEXPLAINED INVESTMENT IN THE ITEMS MENTIONED ABOVE WAS REQUIRE D TO BE MADE. ACCORDINGLY, THE ADDITION OF RS.40,000/- IS DELETED . 15.1 IN VIEW OF THE ABOVE, WE DO NOT FIND ANY INFIR MITY IN THE FINDINGS OF THE CIT(A), AS THE SAME HAVE BEEN ARRIVED AFTER PRO PER APPRECIATION OF THE LEGAL AND FACTUAL POSITION OF THE CASE. ACCORDINGLY , THIS GROUND OF APPEAL OF THE REVENUE IS DISMISSED. 16. THE NEXT GROUND OF APPEAL RAISED BY THE REVENUE RELATES TO THE DELETION OF ADDITION OF RS.2,15,300/- MADE ON ACCOUNT OF UNE XPLAINED INVESTMENT IN THE FIRM M/S. DHARAMVIR BALDEV KRISHAN. IN THE COUR SE OF PRESENT APPELLANT PROCEEDINGS, THE LD. DR PLACED RELIANCE ON THE OR DER OF THE ASSESSING OFFICER. 16.1. THE LD. COUNSEL FOR THE ASSESSEE, ON THE OTHE R HAND , SUPPORTED THE ORDER OF THE CIT(A). 17. HAVING HEARD OF BOTH THE PARTIES AND PERUSING T HE MATERIAL ON RECORD, INCLUDING THE ORDERS OF THE AUTHORITIES BELOW, WE A RE OF THE CONSIDERED OPINION THAT THE LD. CIT(A), WAS JUSTIFIED IN DELET ING THE ADDITION OF 12 RS.2,15,000/-. THE RELEVANT FINDINGS GIVEN BY THE C IT(A) ARE REPRODUCED HEREUNDER: 4.2. CONSIDERING THE EVIDENCE PRODUCED BEFORE ME, AND THE FACTS OF THE CASE, I AM CONVINCED THAT THE ACTUAL INVESTMENT MADE BY THE APPELLANT IN THE FIRM M/S. DHARAM BIR BALDEV KRISHA N, LUDHIANA WAS RS.3,34,000/- WHICH HE HAD WITHDRAWN FROM THE FIRM, M/S. SUNDER LAL & CO., AND THE FIGRE OF RS.4,00,000/- BEING INVESTM ENT IN THE FIRM WAS RANDOMLY BASED ON THE MEMORY OF THE APPELLANT. HENC E, I FEEL THAT NO ADDITION WAS CALLED FOR ON THIS ACCOUNT. ACCORDINGL Y, I DIRECT THE A.O. TO DELETE THE ADDITION OF RS.2,15,300/- MADE ON THI S GROUND. IN VIEW OF THE ABOVE, WE ARE IN COMPLETE AGREEMENT WITH THE FINDINGS OF THE CIT(A), AS THE SAME HAVE BEEN ARRIVED AFTER PROPER APPRECIATION OF THE LEGAL AND FACTUAL POSITION OF THE CASE.. HENCE, THE SAME ARE UPHELD AND THIS GROUND OF APPEAL IS DISMISSED. 18. THE NEXT GROUND OF APPEAL RELATES TO THE DELETI ON OF ADDITION OF RS.2,16,550/- ON ACCOUNT OF UNEXPLAINED INVESTMENT IN THE PURCHASE OF SHOP IN A.C. MARKET. 18.1. WE HAVE ALREADY DECIDED THE SIMILAR ISSUE IN THE FOREGOING PARAGRAPH NO.10, OF THIS ORDER FOR THE ASSESSMENT YEAR 1994-9 5, AND FOLLOWING THE SAME, WE DISMISS THIS GROUND OF APPEAL OF THE REVEN UE. 19. THE NEXT GROUND OF APPEAL RELATES TO THE DELETI ON OF ADDITION OF RS.10,70,00/- BY THE CIT(A), ON ACCOUNT OF UNDISCLO SED INVESTMENT AND PROFIT IN BENAMI CONCERN NAMELY M/S. N.S. SIDHU & C O. THE BRIEF FACTS OF THE ISSUE IN DISPUTE ARE THAT IN THE COURSE OF SEAR CH AT THE RESIDENCE OF THE ASSESSEE, THE STATEMENT OF SH. SAT PAL WAS RECORDE D U/S 132(4) OF THE ACT ON OATH. IN THE STATEMENT SH. SAT PAL STATED THAT HIS FATHER SH. DHARAMVIR, THE ASSESSEE IS A PARTNER IN M/S. N.S. SIDHU CO., LUDH IANA WHEREAS NO OTHER FAMILY MEMBER IS CARRYING OUT ANY BUSINESS/TRADE. SH. DHARAMVIR WAS ALSO 13 PRESENT AT THE TIME OF SEARCH. SH. KHARAITI LAL BRO THER OF THE ASSESSEE AT THE TIME OF SURVEY DEPOSED THAT THE LIQUOR VENDS WERE OWNED BY HIS BROTHERS S/SH. DHARAMVIR AND BALDEV RAJ. SH. KHARAITI LAL IS RUNNING AN AHATA ATTACHED TO PAKHOWAL VENDS. SH. SANSAR SINGH , WH O WAS ATTENDING TO SH. DHARAMVIR BALDEV RAJ (M/S. N.S. SIDHU & CO.,) AT T HE TIME OF SURVEY HAS ALSO STATED THAT THE LIQUOR VENDS ARE OWNED BY SH. DHARAMVIR, WHO ALSO COLLECTS THE DAILY SALES COLLECTIONS. HE FURTHER ST ATED THAT THE LICENCE TO RUN THESE VENDS WAS IN THE NAME OF M/S. N.S. SIDHU & CO . AND THAT SH. DHARAMVIR AND BALDEV RAJ ARE CONTROLLING THE ENTIRE BUSINESS. THE ASSESSING OFFICER, AFTER CONSIDERING THE SUBMISSIONS OF THE A SSESSEE AND EXAMINING THE RECORDS RELATING TO SEARCH AND SURVEY, MADE AN ADDI TION OF RS.10,70,000/-. ON APPEAL, THE SAME WAS DELETED BY THE CIT(A). AGGR IEVED WITH THE ORDER OF THE CIT(A), THE REVENUE IS IN APPEAL BEFORE US. 19.1. THE LD. DR, PLACED RELIANCE ON THE ORDER OF THE ASSESSING OFFICER. 19.2. THE LD. COUNSEL FOR THE ASSESSEE, ON THE OTHE R HAND, SUPPORTED THE ORDER OF THE CIT(A). 19.3. WE HAVE HEARD BOTH THE PARTIES AND CONSIDERED THE RIVAL SUBMISSIONS WITH REFERENCE TO FACTS, EVIDENCE AND MATERIAL PLAC ED ON RECORD. WE HAVE ALSO GONE THROUGH THE ORDERS OF THE AUTHORITIES BEL OW. FROM THE PERUSAL OF THE ORDER OF THE CIT(A), WE FIND THAT HE HAS PASSED A DETAILED AND REASONED ORDER ON THE ISSUE IN DISPUTE, WHICH NEEDS NO INTER FERENCE. THE RELEVANT PART OF THE FINDINGS OF THE CIT(A), IS REPRODUCED HEREUN DER: 6.4. I HAVE EXAMINED THE RIVAL SUBMISSIONS IN THE MATTER, AND I HAVE ALSO GONE THROUGH THE PHOTOCOPIES OF THE EXCISE LIC ENSES PRODUCED BEFORE ME. IT APPEARS THAT THE A.O. HAS NOT APPRECI ATED THE FACTS OF THE CASE CORRECTLY. NO STEPS WERE TAKEN BY HIM TO MAKE ENQUIRIES FROM THE 14 EXCISE DEPARTMENT. HE DID NOT MAKE ANY ENQUIRY FROM THE RESIDENCES OF THE PARTNERS WHO ARE STATED TO BE LIVING IN MODE L GRAM, LUDHIANA, AND WERE STATED TO BE CARRYING ON LIQUOR BUSINESS I N THE SUBSEQUENT YEARS, AND ALSO IN THE CURRENT YEAR I.E. 2002-03. T HE A.O. HAS NOT MADE ANY EFFORT TO REBUT OR DISPROVE THE CONTENTS OF THE AFFIDAVIT OF ONE OF THE PARTNERS OF M/S. N.S. SIDHU & CO.DEPOSIN G THAT THE APPELLANT AND HIS BROHER SH. BALDEV RAJ WERE THEIR EMPLOYEES. IN VIEW OF THE FACTS OF THE CASE AS ENUMERATED ABOVE, I AM CONVINCED THAT THE APPELLANT AND HIS BROTHER SH. BALDEV RAJ WERE E MPLOYEES OF M/S. N.S.SIDHU & CO., LIQUOR CONTRACTORS, PAKHOWL ROAD, LUDHIANA. NO EVIDENCE GATHERED FROM ANY QUARTER LEADS TO PROVE THAT ANY PART OF THE INVESTMENT WAS INDEED MADE BY THE APPELLANT, OR HIS BROTHER. ALSO, THERE IS NO ENTRY IN THE BOOKS OF ACCOUNTS IMPOUNDE D BY THE DEPARTMENT U/S 131 OR ANY OTHER SEIZED RECORD; WHIC H COULD SUPPORT THE CASE OF THE A.O. CONSIDERING THESE FACTS, I HOL D THAT THE ADDITION OF RS.10,70,000/- IS NOT BASED ON COGENT EVIDENCE . AC CORDINGLY, THE ADDITION OF RS.10,70,000/- IS DELETED HEREBY. 19.4 IN VIEW OF THE ABOVE, WE DO NOT FIND ANY INFIR MITY IN THE FINDINGS OF THE CIT(A), AS THE SAME HAVE BEEN ARRIVED AFTER PRO PER APPRECIATION OF THE LEGAL AND FACTUAL POSITION OF THE CASE. ACCORDINGLY , THE ORDER OF THE CIT(A), IS UPHELD AND THIS GROUND OF APPEAL OF THE REVENUE IS DISMISSED. 20. IN THE LAST GROUND OF APPEAL, THE REVENUE CONTE NDED THAT THE LD. CIT(A) WAS NOT JUSTIFIED IN DELETING THE ADDITION O F RS.1,58,638/- MADE BY THE A.O. IN THE HANDS OF THE ASSESSEE ON ACCOUNT OF UNEXPLAINED ENTRIES IN THE NAMES OF N.S.SIDHU, H.S.SIDHU AND K.S.SIDHU. B RIEFLY STATED, THE FACTS OF THE CASE ARE THAT LEDGER NO.2 OF THE ASSESSEE WAS IMPOUNDED U/S 131(1) OF THE ACT FROM PAHKOWAL ROAD, VEND ON PAGE 70 OF THIS LEDGER SOME PAYMENT/INVESTMENTS IN THE NAMES OF M/S. N.S. SIDHU , H.S.SIDHU AND K.S. SIDHU WERE FOUND. THE ASSESSEE COULD NOT EXPLAIN TH E NATURE AND SOURCE OF THESE PAYMENTS, WHICH WORKED OUT TO RS.1,58,638/-. ACCORDINGLY, THE A.O. MADE ADDITION OF THIS AMOUNT FROM UNDISCLOSED SOURC ES. ON APPEAL, THE 15 LEARNED CIT(A), DELETED THE ADDITION. AGGRIEVED, T HE REVENUE IS IN APPEAL BEFORE THIS BENCH. 20.1. THE LD. DR RELIED ON THE ORDER OF THE ASSES SING OFFICER. 20.2. ON THE CONTRARY, THE LD. COUNSEL FOR THE ASSE SSEE, RELIED ON THE ORDER OF THE CIT(A). 20.3 HAVING HEARD BOTH THE PARTIES AND PERUSING THE MATERIAL ON RECORD, INCLUDING THE ORDER PASSED BY THE CIT(A), WE FIND N O JUSTIFICATION TO INTERFERE WITH THE ORDER OF THE CIT(A). THE RELEVAN T PART OF THE FINDING OF THE CIT(A) IS REPRODUCED HEREUNDER: 7. THE TENTH GROUND OF APPEAL IS REGARDING THE ASS ESSING OFFICERS ACTION IN MAKING AN ADDITION OF RS.1,58,631/-. THIS GROUND HAS ALREADY BEEN DISCUSSED ABOVE IN GROUND NO.9 WHEREIN I HAVE HELD THAT THE APPELLANT AND HIS BROTHER, SH. BALDEV RAJ WERE EMPLOYEES OF M/S. N.S. SIDHU & CO.. THEREFORE, I FIND NO JUSTIFICATIO N IN MAKING THE ADDITION OF RS.1,58,631/- BY THE A.O. THE OWNERS O F THE BUSINESS CAN DRAW ANY AMOUNT AS THEY WISH. IN VIEW OF MY DECISIO N ABOVE, I DIRECT THE A.O. TO DELETE THIS ADDITION. 20.4 IN VIEW OF THE ABOVE, WE DO NOT FIND ANY INFIR MITY IN THE FINDINGS OF THE CIT(A), AS THE SAME HAVE BEEN ARRIVED AFTER PRO PER APPRECIATION OF THE LEGAL AND FACTUAL POSITION OF THE CASE. ACCORDINGLY , THE ORDER OF THE CIT(A), IS UPHELD AND THIS GROUND OF APPEAL OF THE REVENUE IS DISMISSED. 21. GROUND NOS. 7 & 8 ARE GENERAL IN NATURE AND REQ UIRE NO ADJUDICATION. HENCE, THE SAME ARE DISMISSED. 22. IN C.O. NO. 32(ASR)/2003 (ARISING OUT OF ITA NO .47(ASR)/2003) FOR THE ASSESSMENT YEAR 1995-96,THE ASSESSEE HAS RAISED FOL LOWING GROUNDS: 16 1. THAT THE ORDER OF THE LEARNED CIT(A), JALANDHAR IS ILLEGAL ON ACCOUNT OF THE FACT THAT HE ERRED IN NOT APPRECIATI NG THAT NOTICE U/S 142(1) OF THE ACT WAS ISSUED ON 3.1.1996 AND TH E ASSESSEE DID NOT FILE RETURN OF INCOME UPTO 31.3.1997. THE L D. CIT(A) VIDE ORDER DATD 24.9.1998 SET ASIDE THE ASSESSMENT WITH THE DIRECTIONS THAT THE APPELLANT WOULD BE FREE TO FURN ISH RETURN OF INCOME AND RETURN OF INCOME AS FILED ON 4.5.1999 IN VIEW OF THE PROVISION OF SECTION 139(4, THE RETURN FILED ON 4.5 .1999 IS NON- EST AND WAS NOT REGULARIZED BY ISSUING NOTICE U/S 1 48 OF THE ACT INSPITE OF THE FACT THAT THE A.O. WAS REQUESTED ORA LLY AND AGAIN VIDE LETTER DATED 12.3.2001. HENCE, LD. A.O. WAS N OT COMPETENT TO ISSUE NOTICE U/S 143(2) OF THE ACT, THEREFORE, T HE ASSESSMENT MADE U/S 143(3) OF THE ACT VIDE ORDER DATED 27.3.20 01 IS ILLEGAL AND PRAYED TO BE CANCELLED ON ACCOUNT OF THIS DEFEC T WHICH IS INCURABLE. 2. THE APPELLANT CARVES LEAVE TO AMEND ANY GROUND(S ) OF APPEAL OR ADD ANY NEW GROUND(S) OF APPEAL BEFORE THE APPEAL I S FINALLY HEARD AND DISPOSED OFF. 23. SINCE, WE HAVE UPHELD THE VIEW TAKEN BY THE LD. CIT(A), AND DISMISSED THE APPEAL OF THE REVENUE, THE C.O. FIL ED BY THE ASSESSEE NEEDS NO SEPARATE ADJUDICATION, AS IT FALLS IN THE REALM OF ACADEMIC INTEREST. 24. IN THE RESULT, BOTH THE APPEALS OF THE REVENUE AND C.O. OF THE ASSESSEE ARE DISMISSED. DECISION PRONOUNCED IN THE OPEN COURT ON THE DAT E OF HEARING ITSELF I.E. ON 6 TH JUNE, 2011. SD/- SD/- (H.L. KARWA) (MEHAR SINGH) VICE PRESIDENT ACCOUNTANT MEMBER DATED: 6TH JUNE, 2011 /SKR/ COPY OF THE ORDER IS FORWARDED TO : 1. THE ASSESSEE:SHRI DHARAMBIR, LUDHIANA. 17 2. THE ACIT, RANGE IV, JALANDHAR. 3. THE CIT(A), JALANDHAR. 4. THE CIT, 5. THE SR DR TRUE COPY BY ORDER (ASSISTANT REGISTRAR) INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH : AMRITSAR.