Raj Narain Singh Patel, Lucknow V. Asstt. Commissioner of Income Tax, Lucknow

ITA 479/LKW/2014

• Counselvise Citation: 47923714 RSA 2014
• Duration Of Justice: 1 year(s) 4 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-10-2015
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 22-09-2015
• Assessment Year: 2009-2010
• Appeal Filed On: 28-05-2014
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Salary income; Document seized; Documents seized
• Section: 142(1)

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH A, LUCKNOW BEFORE SHRI SUNIL KUMAR YADAV, JUDICIAL MEMBER AND SHRI A.K. GARODIA, ACCOUNTANT MEMBER ITA NO.479/LKW/2014 ASSESSMENT YEAR:2009-10 A.C.I.T., CENTRAL CIRCLE-I, LUCKNOW. VS SHRI RAJ NARAIN SINGH PATEL, 1/A/4, RAVINDER GARDEN, PROP. GOVINDA MENTHOL, SHEKHPUR, ALIGANJ, LUCKNOW. PAN:AWPPP2387J) (RESPONDENT) (APPELLANT) SHRI P. K. KAPOOR, C.A. APPELLANT BY SHRI A. K. SINGH, CIT, D. R. RESPONDENT BY 30/09/2015 DATE OF HEARING 14 /10/2015 DATE OF PRONOUNCEMENT O R D E R PER A. K. GARODIA, A.M. THIS IS ASSESSEES APPEAL DIRECTED AGAINST THE OR DER PASSED BY LEARNED CIT(A)-III, LUCKNOW DATED 25/02/2014 FOR THE ASSESS MENT YEAR 2009-2010. 2. GROUND NO. 1 & 2 ARE INTER-CONNECTED, WHICH READ AS UNDER: 1. BECAUSE THE 'CIT(A)' HAS ERRED IN LAW AND ON F ACTS IN UPHOLDING AN ADDITION OF RS.1,20,000/- AS HAD BEEN MADE IN THE ASSESSMENT UNDER THE HEAD 'SALARY' ON T HE BASIS OF SOME UNSIGNED AND LOOSE PAPER FOUND DURING THE COURSE OF SEARCH & SEIZURE ACTION. 2. BECAUSE NO SUCH AMOUNT HAD ACTUALLY BEEN RECEIVE D BY THE 'APPELLANT' AND MUCH LESS BY WAY OF INCOME BY T HE 'APPELLANT' AND ADDITION FOR THE SAME, AS HAS BEEN MADE IN THE ASSESSMENT (SUSTAINED ALSO IN APPEAL) IS WHO LLY ERRONEOUS. 2 3. IT WAS SUBMITTED BY LEARNED A.R. OF THE ASSESSE E THAT UNSIGNED AND UNDATED SALARY CERTIFICATE ON THE BASIS OF WHICH TH E ADDITION WAS MADE, IS AVAILABLE ON PAGE NO. 35 OF THE PAPER BOOK. HE ALS O SUBMITTED THAT THE COPY OF RETURN OF INCOME ALONG WITH THE COMPUTATION OF INCOME OF REKHA UTTAM FOR THE PRESENT YEAR IS AVAILABLE ON PAGES 14 4 TO 146 OF THE PAPER BOOK. HE ALSO SUBMITTED THAT REKHA UTTAM IS PROPRI ETOR OF M/S KRISHNA FOOD PRODUCTS BEING THE FIRM ON WHOSE LETTER HEAD, THE U NDATED AND UNSIGNED SALARY CERTIFICATE IS MADE THE BASIS OF MAKING THE ADDITION. HE FURTHER SUBMITTED THAT AS PER THE COMPUTATION OF INCOME OF REKHA UTTAM, AVAILABLE ON PAGE NO. 155, IT CAN BE SEEN THAT INCOME HAS BEE N DECLARED BY HER U/S 44AF AND THEREFORE, NO BOOKS OF ACCOUNT WAS MAINTAI NED BY REKHA UTTAM. HE FURTHER SUBMITTED THAT ON THE BASIS OF THIS UNDA TED AND UNSIGNED SALARY CERTIFICATE, THE ADDITION MADE BY THE ASSESSING OFF ICER AND CONFIRMED BY CIT(A) IS NOT JUSTIFIED. 4. LEARNED D. R. OF THE REVENUE SUPPORTED THE ORDER S OF THE AUTHORITIES BELOW. 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. WE FI ND THAT IT IS NOTED BY THE ASSESSING OFFICER ON PAGE NO. 5 OF THE ASSESSME NT ORDER THAT ON PAGE NO. 62 OF ANNEXURE-A1 OF THE SEIZED DOCUMENTS IS UN SIGNED SALARY CERTIFICATE ON THE LETTER PAD OF M/S KRISHNA FOOD P RODUCTS IN RESPECT OF PRESENT ASSESSEE SHRI RAJ NARAIN SINGH PATEL. HE F URTHER NOTED IN THE ASSESSMENT ORDER THAT VIDE NOTICE U/S 142(1) OF THE ACT DATED 17/09/2010, THE ASSESSEE WAS ASKED TO FURNISH DETAILS IN THIS R EGARD AND IN REPLY DATED 16/10/2010, IT WAS SUBMITTED BY THE ASSESSEE THAT S HRI RAJ NARAIN SINGH PATEL WAS MANAGER IN M/S KRISHNA FOOD PRODUCTS AND WAS DRAWING SALARY OF RS.10,000/- PER MONTH. THEREAFTER, THE ASSESSING O FFICER HAS NOTED THAT M/S KRISHNA FOOD PRODUCTS IS THE PROPRIETORY CONCER N OF REKHA UTTAM AND IT 3 HAS COME INTO EXISTENCE IN THE ASSESSMENT YEAR 2008 -09. THE ASSESSING OFFICER FURTHER NOTED THAT THE ASSESSEE HAS NOT SHO WN RECEIPT OF ANY SALARY INCOME IN HIS RETURN AND ON THIS BASIS, HE MADE ADD ITION IN THE HANDS OF THE PRESENT ASSESSEE ON ACCOUNT OF HIS SALARY INCOME. WE ALSO FIND THAT IT IS NOTED BY CIT(A) ON PAGE NO. 29 OF HIS ORDER THAT TH E ASSESSEE IN HIS SUBMISSION PARA 22 AND 22.1 HAS HIMSELF SUBMITTED T HAT HE HAS SHOWN THE SALARY INCOME UNDER THE HEAD INCOME FROM OTHER SOUR CES. HE HAS REPRODUCED THOSE TWO PARAS OF ASSESSEES SUBMISSION ON THE SAME PAGE OF HIS ORDER. THEREFORE, IT IS SEEN THAT THE FACT OF RECEIVING SALARY INCOME FROM M/S KRISHNA FOOD PRODUCTS IS ACCEPTED BY THE ASSESS EE ALSO AS PER HIS SUBMISSION BEFORE CIT(A). THE COPY OF COMPUTATION OF TOTAL INCOME OF THE ASSESSEE IS AVAILABLE ON PAGES 36 AND 37 AND AS PER THE SAME, IT IS SEEN THAT THE ASSESSEE HAS NOT REPORTED ANY SALARY INCOM E. HE HAS REPORTED AN INCOME OF RS.98,564/- UNDER THE HEAD INCOME FROM OT HER SOURCES AND IT WAS SUBMISSION OF THE ASSESSEE BEFORE THE CIT(A) THAT T HIS INCOME INCLUDES INCOME OF RS.96,000/- BEING SALARY INCOME RECEIVED FROM M/S KRISHNA FOOD PRODUCTS. BUT IN THE COMPUTATION OF INCOME, THIS A MOUNT HAS BEEN SHOWN AS OTHER INCOME AND AFTER ADDING INTEREST INCOME OF RS.2,564/-, TOTAL INCOME UNDER THE HEAD INCOME FROM OTHER SOURCES WAS REPORT ED AT RS.98,564/-. UNDER THESE FACTS, WE ARE OF THE CONSIDERED OPINION THAT THE ADDITION OF RS.1.20 LAC ON ACCOUNT OF SALARY INCOME WAS CORRECT LY MADE BY THE ASSESSING OFFICER AND UPHELD BY CIT(A) BECAUSE THE RECEIPT OF SALARY INCOME IS NOT DISPUTED BY THE ASSESSEE ALSO AS PER HIS SUB MISSION BEFORE CIT(A), WHICH HAS BEEN REPRODUCED BY CIT(A) ON PAGE NO. 29 OF THE PAPER BOOK AND THIS CLAIM OF THE ASSESSEE THAT THE ASSESSEE HA S SHOWN RS.96,000/- AS OTHER INCOME UNDER THE HEAD INCOME FROM OTHER SOURC ES AND THIS REPRESENTS SALARY FROM M/S KRISHNA FOOD PRODUCTS IS NOT ACCEPT ABLE BECAUSE SALARY INCOME HAS TO BE TAXED UNDER THE HEAD INCOME FROM S ALARY AND THE AMOUNT OF RS.96,000/- REPORTED BY THE ASSESSEE UNDER THE H EAD INCOME FROM OTHER 4 SOURCES IS NOT ON ACCOUNT OF SALARY BUT ON ACCOUNT OF OTHER INCOME. HENCE, WE FIND NO MERIT IN THESE GROUNDS OF THE ASSESSEE. ACCORDINGLY, GROUND NO. 1 & 2 ARE REJECTED. 6. GROUND NO. 3 & 4 ARE INTER-CONNECTED, WHICH READ AS UNDER: 3. BECAUSE THE AUTHORITIES BELOW HAVE ERRED IN LA W AND ON FACTS IN UPHOLDING AN ADDITION OF RS.8,50,000/- TO THE INCOME OF THE 'APPELLANT' ON ACCOUNT OF CASH FOUND DURING THE COURSE OF SEARCH & SEIZURE ACTION AS HAD COMMENCED ON 19.1 1.1998. 4. BECAUSE ON A DUE CONSIDERATION OF THE FACTS AND CIRCUMSTANCES OF THE CASE, PARTICULARLY THAT (A) SHRI K.N. SINGH PATEL AS HEAD OF THE 'PATEL GROUP' HAD DISCLOSED AN INCOME OF RS.25 LAKHS ON ACCOUNT OF CA SH FOUND DURING THE COURSE OF SEARCH, WHICH COVERED TH E 'PATEL GROUP' AS A WHOLE; (B) IN THE SWORN AFFIDAVIT DATED 25.02.2009, SHRI K.N. SINGH PATEL HAD GIVEN ALL THE RELEVANT PARTICULARS AND INFORMATION AND THE SAME WAS SUBJECTED TO CROSS EXAMINATION ALSO BY THE INVESTIGATION WING, (C) IN THE RETURN FILED BY SHRI K.N. SINGH PATEL, HE HA D DULY DISCLOSED THE OVERALL SURRENDER OF RS.25 LAKHS AS H IS INCOME AND ON SUCH AN INCOME HE HAD DULY PAID TAXES ALSO; THE CIT (A) SHOULD HAVE DELETED THE ADDITION. 7. IT WAS SUBMITTED BY LEARNED A.R. OF THE ASSESSEE THAT ON PAGE NO. 74 IS A SUMMARY OF CASH FOUND AND SEIZED IN THE SEARCH CARRIED OUT IN PATEL GROUP AND CASH FOUND WAS RS.57.93 LAC AND CASH SEIZ ED WAS RS.35.79 LAC. THEREAFTER, HE DRAWN OUR ATTENTION TO THE AFFIDAVIT DATED 25/02/2009 OF SHRI K. N. SINGH PATEL FILED BEFORE ADDL. DIRECTOR OF IN COME TAX (INVESTIGATION), LUCKNOW, AVAILABLE ON PAGES 38 TO 52 OF THE PAPER B OOK AND IN PARTICULAR, OUR ATTENTION WAS DRAWN TO PAGE NO. 47 AND IT WAS P OINTED OUT THAT THE DISCLOSURE OF RS.10 CRORE MADE BY SHRI K. N. SINGH PATEL INCLUDES RS.25 LAC 5 BEING CASH SEIZED AT VARIOUS PLACES. HE SUBMITTED THAT THIS DISCLOSURE OF RS.25 LAC BY SHRI K. N. SINGH PATEL ON ACCOUNT OF C ASH SEIZED AT VARIOUS PLACES INCLUDES THE CASH SEIZED FROM THE PRESENT AS SESSEE ALSO. THEREAFTER, HE DRAWN OUR ATTENTION TO THE TRIBUNAL ORDER IN THE CASE OF SHRI K. K. SHUKLA IN I.T.A. NO. 235 TO 241/LKW/2012 DATED 16/11/2005 AVAILABLE ON PAGES 85 TO 108 AND IN PARTICULAR, OUR ATTENTION WAS DRAWN T O PARA 39.1 OF THIS TRIBUNAL ORDER AVAILABLE ON PAGE 107 OF THE PAPER B OOK. HE SUBMITTED THAT IN THAT CASE ALSO, TOTAL CASH FOUND WAS RS.8.65 LAC AND THE ADDITION WAS MADE OF RS.8 LAC AND IT WAS EXPLAINED IN THAT CASE ALSO THAT IT SHOULD BE COVERED BY THE DISCLOSURE OF RS.25 LAC MADE BY SHRI K. N. SINGH PATEL ON ACCOUNT OF CASH SEIZED BUT THE TRIBUNAL DID NOT ACC EPT THIS EXPLANATION AND THE ADDITION IN THAT CASE WAS UPHELD. THEREAFTER, HE SUBMITTED THAT SINCE OUT OF TOTAL CASH SEIZED OF RS.35.79 LAC, ADDITION OF RS.8LAC IS ALREADY UPHELD IN THE CASE OF SHRI K. K. SHUKLA AND RS.25 LAC WAS INCLUDED BY SHRI K. N. SINGH PATEL IN HIS DISCLOSURE, NO ADDITION IN THE P RESENT CASE SHOULD BE MADE. 8. AS AGAINST THIS, LEARNED D. R. OF THE REVENUE SU PPORTED THE ORDERS OF THE AUTHORITIES BELOW. HE ALSO SUBMITTED THAT CASH SEIZED WAS RS.35.79 LAC BUT CASH FOUND WAS RS.57.93 LAC AND THEREFORE, THE ASSESSEE HAS TO EXPLAIN THE CASH FOUND RS.57.93 LAC. 9. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. WE FI ND THAT AS PER THE TRIBUNAL ORDER RENDERED IN THE CASE OF SHRI K. K. SHUKLA (SUPRA), THIS ISSUE WAS DECIDED AS PER PARA 39.1 OF THE TRIBUNAL ORDER, WHICH IS REPRODUCED BELOW FOR THE SAKE OF READY REFERENCE: 39.1 FROM THE ABOVE PARA FROM THE ORDER OF CIT(A), IT IS SEEN THAT IT IS NOTED BY HIM THAT THE TOTAL CASH FOUND W AS RS.8,65,735/- AND THE ADDITION HAS BEEN MADE FOR RS .8 LAC ONLY. AS PER THE ASSESSMENT ORDER IN THE CASE OF S HRI K. N. 6 SINGH PATEL, WE FIND THAT NO DOUBT DISCLOSURE HAS B EEN MADE OF RS.10 CRORE WHICH INCLUDED RS.25 LAC ON ACCOUNT OF CASH SEIZED BUT IT IS ALSO SEEN IN THE SAME ASSESSMENT ORDER TH AT THE SEARCHES WERE CARRIED OUT AT 19 PLACES, AS LISTED O N PAGE NO. 220 OF THE PAPER BOOK. THE NAME OF THE ASSESSEE IS ALSO APPEARING IN THAT LIST AT S.NO. 13 BUT IT IS NOT SH OWN TO US OR TO ANY OF THE AUTHORITIES BELOW THAT HOW MUCH CASH WAS FOUND AND SEIZED AT THESE 19 PLACES WHERE SEARCHES WERE C ARRIED OUT. IF THE ASSESSEE COULD HAVE SHOWN THAT THE CASH FOUN D AND SEIZED WERE RS.25 LAC OR LESS THEN IT CAN BE ACCEPT ED THAT THE ENTIRE CASH FOUND AND SEIZED IN ALL SEARCHES WERE C OVERED IN THE DISCLOSURE MADE BY SHRI K. N. SINGH PATEL BUT I N THE ABSENCE OF THAT, IT CANNOT BE SAID THAT ALL THE CAS H FOUND AND SEIZED IN COURSE OF ALL THESE 19 SEARCHES WERE INCL UDED IN THE DISCLOSURE MADE BY SHRI K. N. SINGH PATEL ON ACCOUN T OF CASH FOUND. HENCE, WE DO NOT FIND ANY MERIT IN THIS EXP LANATION OF THE ASSESSEE REGARDING THE CASH FOUND AND SEIZED IN THE HANDS OF THE PRESENT ASSESSEE. BENEFIT TO THE EXTENT OF RS.65,375/- IS ALREADY ALLOWED BY THE AUTHORITIES BELOW BECAUSE AGAINST THE CASH FOUND OF RS.8,65,365/-, ADDITION OF RS.8 LAC O NLY WAS MADE. CONSIDERING ALL THESE FACTS, WE DO NOT FIND ANY REASON TO INTERFERE IN THE ORDER OF CIT(A) ON THIS ISSUE A LSO. ACCORDINGLY, GROUND NO. 3 & 4 ARE REJECTED. 9.1 FROM THE ABOVE PARA, IT IS SEEN THAT IT IS NOTE D BY THE TRIBUNAL THAT THE SEARCHES WERE CARRIED OUT AT 19 PLACES BUT IT I S NOT SHOWN TO THE TRIBUNAL OR ANY OF THE AUTHORITIES BELOW THAT AS TO HOW MUCH CASH WAS FOUND. AS PER PAGE NO. 74 OF THE PAPER BOOK FURNIS HED BEFORE US ALSO, THE DETAILS OF CASH FOUND AND CASH SEIZED IS GIVEN IN R ESPECT OF 11 ASSESSEES AS AGAINST SEARCHES AT 19 PLACES. THE TRIBUNAL HAS G IVEN A FINDING IN THAT CASE THAT IF THE ASSESSEE COULD HAVE SHOWN THAT THE CASH FOUND AND SEIZED WERE RS.25 LAC OR LESS THEN IT CAN BE ACCEPTED THAT THE ENTIRE CASH FOUND AND SEIZED IN ALL SEARCHES WERE COVERED IN THE DISCLOSU RE MADE BY SHRI K. N. SINGH PATEL BUT IN THE ABSENCE OF THAT, IT CANNOT B E SAID THAT ALL THE CASH FOUND AND SEIZED IN COURSE OF ALL THESE 19 SEARCHES WERE INCLUDED IN THE DISCLOSURE MADE BY SHRI K. N. SINGH PATEL ON ACCOUN T OF CASH FOUND. SINCE IN THE PRESENT CASE ALSO, THE DETAILS OF CASH FOUND AND SEIZED IS GIVEN FOR 11 7 PERSONS ONLY, AS AGAINST 19 SEARCHES, WE FIND NO RE ASON TO TAKE A CONTRARY VIEW IN THE PRESENT CASE AND THEREFORE, RESPECTFULL Y FOLLOWING THE EARLIER TRIBUNAL ORDER RENDERED IN THE CASE OF SHRI K. K. S HUKLA (SUPRA), WE DECLINE TO INTERFERE IN THE ORDER OF CIT(A) ON THIS ISSUE A LSO. THESE GROUNDS ARE REJECTED. 10. IN THE RESULT, THE APPEAL OF THE ASSESSEE STAND S DISMISSED. (ORDER WAS PRONOUNCED IN THE OPEN COURT ON THE DATE MENTIONED ON THE CAPTION PAGE) SD/. SD/. (SUNIL KUMAR YADAV) ( A. K. GAROD IA ) JUDICIAL MEMBER ACCOUNTANT MEM BER DATED:14/10/2015 *SINGH COPY OF THE ORDER FORWARDED TO : 1.THE APPELLANT 2.THE RESPONDENT. 3.CONCERNED CIT 4.THE CIT(A) 5.D.R., I.T.A.T., LUCKNOW ASSTT. RE GISTRAR