THE ACIT, (CENTRAL)-I, Indore V. SHRI SHARAD DOSHI, Indore

ITA 537/IND/2015

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 5311 (ITAT-INDORE)
• Duration Of Justice: 1 year(s) 5 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-12-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 29-11-2016
• Assessment Year: 2009-2010
• Appeal Filed On: 16-07-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MOHD JAVED
• Assessee Lawyers: SHRI
• Keywords: Unexplained investment; Loose papers; Share purchase agreement; Block assessment
• Section: 147; 131; 69; 132

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL, INDORE BENCH, INDORE .., .., % BEFORE SHRI D.T. GARASIA, JUDICIAL MEMBER AND SHRI O.P. MEENA, ACCOUNTANT MEMBER ACIT(CENTRAL)-I, INDORE. .. ./ PAN: ABZPD4869L VS. SHRI SHARAD DOSHI, INDORE. / APPELLANT / RESPONDENT / APPELLANT BY SHRI MOHD.JAVED, DR / RESPONDENT BY SHRI MAHESH AGRAWAL AND SHRI PANKAJ SHAH, CAS DATE OF HEARING 29.11.2016 DATE OF PRONOUNCEMENT 23 .12.2016 / O R D E R PER O.P. MEENA, ACCOUTANT MEMEBR. THIS APPEAL IS FILED BY THE REVENUE AGAINST THE ORD ER OF LD. COMMISSIONER OF INCOME-TAX (APPEALS)-II, INDORE [HEREINAFTER REFERRED TO AS THE CIT(A)] DATED 20.02 .2015 AND .. . / I.T.A. NO. 537/IND/2015 %' ' / ASSESSMENT YEAR: 2009-10 I.T.A.NO. 537/IND/2015 A.Y.2009-10 PAGE 2 OF 27 SHRI SHARAD DOSHI, INDORE. PERTAINS TO ASSESSMENT YEAR 2009-10 AS AGAINST APPE AL DECIDED IN ASSESSMENT ORDER DATED 28.03.2013 PASSE D U/S 147 [143(3)] OF INCOME-TAX ACT, 1961, BY THE ACIT, 3(1),INDORE. [HEREINAFTER REFERRED TO AS THE AO]. 2. THE ONLY GROUND OF APPEAL TAKEN BY THE REVENUE READ S AS UNDER :- ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) ERRED IN DELETING THE ADDITION MADE ON ACCOUNT OF UNDISCLOSED INCOME AMOUNTING TO RS. 3,00,00,000/-. 3. BRIEFLY STATED, THE FACTS OF THE CASE ARE THAT SOME PAPERS PAGES 74 TO 78 OF LPS-33 WERE FOUND AND SEIZE D IN THE FORM OF EXCEL SHEETS FROM SHRI NILESH AJMERA DURING SEARCH OF SATELLITE GROUP. THE ASSESSEE WAS ASKED TO EXPLAIN T HE INVESTMENT MADE BY C.S.DEVELOPERS, A FIRM WHOSE LOOS E PAPERS WERE FOUND AND SEIZED DURING THE COURSE OF SEARCH FR OM THE PREMISES OF SATELLITE GROUP, WHICH WERE HAVING RELATI ON WITH THE ASSESSEE. THE ASSESSEE VIDE REPLY DATED 22.03.2 013 SUBMITTED THAT HE HAS NEVER ENTERED IN TO FINANCIAL TRANSACTION WITH SHRI NILESH AJMERA, SHRI RITESH AJMERA AND SHRI CHIRAG I.T.A.NO. 537/IND/2015 A.Y.2009-10 PAGE 3 OF 27 SHRI SHARAD DOSHI, INDORE. SHAH. THE ASSESSEE HAS ALSO SUBMITTED THAT HE HAS N O CONNECTION WITH C. S. DEVELOPERS AND HAS NEVER MADE ANY INVESTMENT IN DUBAI. THE ASSESSEE HAS ALSO CLAIMED OF NOT HAVING ANY PARTNERSHIP DEED OF C. S. DEVELOPERS. HO WEVER, THIS CONTENTION OF THE ASSESSEE WAS NOT FOUND ACCEP TABLE BY THE AO. ACCORDING TO THE AO, THE AO OF SHRI NILESH AJMERA AND SHRI RITESH AJMERA, HAS CLEARLY ESTABLISHED THE LIN KAGE BETWEEN MATERIAL SEIZED FROM PREMISES OF PHOENIX DE VCON PRIVATE LIMITED WITH THE ASSESSEE. THE AO ALSO REPRO DUCED THE RELEVANT PORTION OF ASSESSMENT ORDER OF SHRI NILESH AJMERA IN HIS ASSESSMENT ORDER AT PAGE 3. THE AO HAS SIMPLY R ELIED ON ANALYSIS OF PAGES OF ASSESSMENT ORDER AS WAS DONE IN THE ASSESSMENT ORDER OF SHRI NILESH AJMERA AND MERELY REPRODUCED PART OF THAT ORDER, IN HIS ORDER. HOWEVE R, IN DOING SO, HE REPRODUCED IN PARA 7.4.6 PAGE 9 OF ASSESSMEN T ORDER THE QUANTUM OF AMOUNT AND FUND FLOW IN DUBAI INVESTM ENT AS PER SEIZED PAGE 74 TO 78. BUT IN HIS CONCLUDING REM ARKS ON PAGE 24 OF ASSESSMENT ORDER, HE STATED THAT THE ASS ESSEE HAS RECEIVED RS. 3 CRORES. THIS SHOWS THE UTTER CONFUSI ON IN MIND OF AO, AS REGARDS NATURE OF SUCH TRANSACTION, AS TO WHETHER IT I.T.A.NO. 537/IND/2015 A.Y.2009-10 PAGE 4 OF 27 SHRI SHARAD DOSHI, INDORE. WAS INVESTMENT IN DUBAI PROPERTY OR WAS AN UNACCOUNTE D RECEIPT IN HANDS OF ASSESSEE. 4. THE MATTER CARRIED TO THE LD. CIT(A) AND THE LD. CI T(A) HAS DELETED THE ABOVE ADDITION BY RELYING THE DECIS ION PASSED IN THE CASE OF SHRI NILESH AJMERA IN ORDER NO. CIT( A)-7/IT - 922/11-12 DATED 28.03.2013 FOR THE ASSESSMENT YEAR 2009- 10 BY OBSERVING AS UNDER :- 6. THE REASON FOR SUCH CONFUSION IN MIND OF AO IS NOT FAR TO SEEK. HE HAS MADE SUCH ADDITION ENTIRELY RELYING ON SOME PAPERS WHICH WERE SEIZED FROM PREMISES OF SOME OTHER PERSON NAMED SHRI NILESH AJMERA. THESE PAPERS WERE NOT SEIZED FROM PREMISES OF APPELLANT. BOTH SHRI NILESH AJMERA IN HIS STATEMENT RECORDED DURING SEARCH & APPELLANT IN HIS STATEMENT RECORDED U/S 131 OF LT, ACT DENIED ANY SUCH INVESTMENT IN DUBAI PROPERTY. THEREAFTER ONUS PASSED ON TO AO TO FIND OUT SOME CORROBORATIVE EVIDENCE IN THIS REGARD IN ORDER TO ESTABLISH PURCHASE OF DUBAI PROPERTY. BUT AO . COULD RIOT POINT OUT ANY CORROBORATIVE EVIDENCE, WHICH COULD PROVE SUCH INVESTMENT. WITHOUT I.T.A.NO. 537/IND/2015 A.Y.2009-10 PAGE 5 OF 27 SHRI SHARAD DOSHI, INDORE. SATISFYING PRE-REQUISITE CONDITION OF SECTION 69 OF THE LT. ACT, WITHOUT ESTABLISHING THAT INVESTMENT WAS MADE IN SOME PROPERTY AND THAT IT WAS UNRECORDED, PROVISIONS OF SECTION 132(4A) OF I.T. ACT CANNOT BE INVOKED, AS HELD IN CASE OF USHAKANT PATEL [2006] 282 ITR 553 (GUJ.) AND SHARAD CHAUDHARY [2014] 165 TTJ 145 (DELHI TRIB.) EVEN OTHERWISE AS PAPERS WERE NOT SEIZED FROM APPELLANT, SEC. 132 (4A) OF LT. ACT COULD NOT BE INVOKED. 7. BUT CONFUSION IN MIND OF AO AROSE FROM THE VERY NATURE OF PAPERS SEIZED AT PAGE 74 TO 78 OF LPS-33 FROM SHRI NILESH AJMERA. IF WE EXAMINE THESE EXCEL SHEETS AS PRODUCED ON PAGE 10 TO 13 OF ASSESSMENT ORDER, IT CAN BE SEEN THAT THERE IS NO HEADING/ DESCRIPTION/ NAME GIVEN TO SUCH SHEETS AND THEREFORE IT COULD NOT BE CONNECTED TO ANYTHING AND ADI/ AO COULD NOT STATE AS TO HOW IT COULD BE CONSIDERED AS CONNECTED TO DUBAI INVESTMENT. SECONDLY ON THESE PAPERS NO DATE IS AVAILABLE ANYWHERE, HENCE IT IS NOT KNOWN HOW AO ARRIVED AT CONCLUSION TO ADD SUCH AMOUNT IN AY 2009-10 AND NOT IN SOME OTHER YEAR. THIRDLY THE I.T.A.NO. 537/IND/2015 A.Y.2009-10 PAGE 6 OF 27 SHRI SHARAD DOSHI, INDORE. RELEVANT ENTRIES ON THESE PAPERS DUE TO WHICH ADDITIONS WERE MADE WERE WRITTEN AS, 1,00,00,000 - SHARAD/PANKAJ AND 2,00,00,000 - SHARD DIRECT. BUT NOWHERE ON THIS PAPERS NAME OF APPELLANT I.E. SHARAD DOSHI IN WRITTEN AND NEITHER ADI NOR AO STATED HOW 'SHARAD' COULD MEAN ONLY 'SHARAD DOSHI' AND NOT ANY OTHER 'SHARAD'. BESIDES THERE WAS A CHEQUE PAYMENT ALSO SEEN IN EXCEL SHEET OF RS.7,80,396/- ALONGWITH RS.1,00,00,000/- WHICH IS SHOWN AS PAID BY SHARAD/PANKAJ. BUT NEITHER ADI NOR AO EXAMINED AS TO WHO PAID SUCH CHEQUE, FROM WHICH BANK A/C AND ON WHICH DATE. THEREFORE ADI/ AO COULD NOT ESTABLISH ANY LINKAGE OF SUCH PAYMENT WITH SHRI SHARAD DOSHI. IN PRESENT CASE NEITHER DOCUMENT RELIED ON BY THE AO WERE SPEAKING NOR AO GATHERED ANY MATERIAL TO SUPPORT HIS CONTENTION. IN THIS REGARDS RELIANCE IS PLACED ON THE DECISION IN CASES OF GYANKUMAR AGARWAL [2012] 146 TIJ 334 (HYDERABAD TRIB.), KAMLA PRASAD SINGH [2010] 3 ITR (T) 533 (PATNA), 'GIRISH. CHAUDHARY [2008] 296 ITR 619 (DELHI) AND DIMSY FOOD & CHEMICALS P. LTD. [2008] 24 SOT 65 (DELHI) (URO). I.T.A.NO. 537/IND/2015 A.Y.2009-10 PAGE 7 OF 27 SHRI SHARAD DOSHI, INDORE. 8. APPELLANT WAS ALSO SUBSEQUENTLY COVERED UNDER SEARCH ACTION ON 28-02-2014 AND APPELLANT HAS ASSERTED THAT NO PROOF/DOCUMENT/TITLE DEED OF ANY SUCH PROPERTY OR PROOF OF ANY SUCH DUBAI INVESTMENT WAS FOUND & SEIZED FROM HIM. I RELY ON SUCH SUBMISSION OF APPELLANT & IF LATER ON DURING SEARCH ASSESSMENTS THIS ASSERTION IS FOUND FALSE, THE AO WOULD BE FREE TO TAKE NECESSARY ACTION, IN ACCORDANCE WITH LAW. 9. SIMILAR ADDITION MADE IN CASE OF SHRI NILESH AJMERA FROM WHOM THESE PAPERS WERE SEIZED, WERE DELETED BY LD CIT(A) IN ORDER NO. CIT(A)-7/IT- 922/2011-12 DATED 28-03-2013, WHEREIN THE ENTIRE ADDITION OF RS.5,60,50,000/- ON A/C OF DUBAI HAWALA, WAS DELETED IN PARA 12.18: 10. RELYING ON AFORESAID DECISION AS ALSO DISCUSSION MADE IN AFORESAID PARAS, ADDITION OF RS. 3 CRORE MADE IN HANDS OF APPELLANT IS HEREBY DELETED. AS A RESULT, GROUND NO.1.1 OF APPEAL IS ALLOWED. I.T.A.NO. 537/IND/2015 A.Y.2009-10 PAGE 8 OF 27 SHRI SHARAD DOSHI, INDORE. 5. THE LD. SR. DEPARTMENTAL REPRESENTATIVE RELIED UPON THE ORDER OF THE AO. HOWEVER, HE COULD NOT CONTROV ERT THE FINDING OF THE LD. CIT(A) BY BRINGING ANY COGENT MA TERIAL ON RECORD. 6. THE LD. AUTHORIZED REPRESENTATIVE OF THE ASSESSEE SUBMITTED THAT THE ORDER NO. CIT(A)-7/IT-922/11-12 DATED 28.03.2013 OF SHRI NILESH AJMERA WHICH IS RELIED BY THE LD. CIT(A) WHILE DELETING THE ADDITION IN THE HANDS OF T HE ASSESSEE WAS SUBJECT MATTER OF APPEAL BEFORE THIS TRIBUNAL FR OM THE SIDE OF THE REVENUE IN APPEAL NO. 251/IND/2013 FOR ASSES SMENT YEAR 2009-10 DATED 17.05.2016 VIDE GROUND NOS. 4 & 4.1. THE GROUND OF THE DEPARTMENT WAS DISMISSED BY THIS TRIBU NAL, INDORE IN THE CASE OF SHRI NILESH AJMERA. THE ORDER OF THE CIT(A)-7 IN ORDER NO. CIT(A)-7/IT-922/11-12 DATED 2 8.03.2013 WAS CONFIRMED BY THE TRIBUNAL. THE LD. SR. DEPARTME NTAL REPRESENTATIVE COULD NOT CONTROVERT THE SUBMISSION OF THE ASSESSEE. 7. IT WAS FURTHER SUBMITTED BEFORE US THAT THE DEPARTMENTAL GROUND NOS. 4 & 4.1 IN IT(SS)A-251/IND /2013 IN THE CASE OF SHRI NILESH AJMERA ARE SIMILAR TO THAT OF GROUNDS I.T.A.NO. 537/IND/2015 A.Y.2009-10 PAGE 9 OF 27 SHRI SHARAD DOSHI, INDORE. TAKEN BY THE DEPARTMENT IN ITS APPEAL FOR A.Y. 2009 -10. IN THIS APPEAL, FINDING GIVEN WILL ALSO BE APPLICABLE IN THE PRESENT CASE. IN VIEW OF THIS SUBMISSION, WE ARE REPRODUCING HEREUNDER THE RELEVANT PORTION OF THE ORDER OF THE TRIBUNAL PASSED IN I.T.(SS)A.NO. 251/IND/2013 FOR READY REFE RENCE :- DEPARTMENTAL GROUND NOS.4 & 4.1(SHRI NILESH AJMERA: THE REVENUE HAS TAKEN THIS GROUND OF APPEAL AGAINST THE ACTION OF THE LD. CIT(A) IN DELETING THE ADDITI ON OF RS.5,60,50,000/- MADE BY THE AO UNDER THE HEAD DUBA I HAWALA OBSERVING THAT THE AO COULD NOT ADDUCE ANY EVIDENCE OTHER THAN THE PAPERS SEIZED. THE BRIEF FACTS RELATING TO THE GROUND, AS NOTED BY THE AO IN THE BODY OF THE ASSESSMENT ORDER ARE THAT DUR ING THE COURSE OF SEARCH PROCEEDINGS U/S. 132, VARIOUS DOCU MENTS WERE SEIZED FROM THE DIFFERENT PREMISES OF THE GROU P AND FROM SUCH DOCUMENTS IT WAS NOTED BY THE AO THAT THE ASSESSEE AND OTHERS WERE INSTRUMENTAL IN ENVISIONIN G REAL ESTATE PROJECT IN DUBAI AND FOR MAKING SUCH INVESTM ENTS THERE ARE INCIDENCES OF HAWALA TRANSACTIONS TO DUBA I. THE AO ON THE PERUSAL OF VARIOUS LOOSE PAPERS, AND IN PARTICULAR LOOSE PAPERS INVENTORISED AS PAGE NO. 75 , 76 & 77 OF LPS-33, FORMED THE VIEW THAT THESE LOOSE PAPE RS PERTAINS TO DUBAI HAWALA BY THE ASSESSEE AND OTHERS . ON THE BASIS OF SUCH LOOSE PAPERS, THE AO REQUIRED THE ASSESSEE TO EXPLAIN THE NATURE AND SOURCES OF INVES TMENT IN REAL ESTATES AT DUBAI BUT THE ASSESSEE DENIED TO HAVE MADE ANY INVESTMENT IN ANY REAL ESTATE AT DUBAI AND ALSO DESCRIBED THE LOOSE PAPERS, REFERRED TO BY THE AO, AS DUMB DOCUMENTS ONLY. THE AO IN BODY OF THE ORDER, AFTER DISCUSSING THE DETAILS OF A PROJECT TITLED AS THE WORLD AT I.T.A.NO. 537/IND/2015 A.Y.2009-10 PAGE 10 OF 27 SHRI SHARAD DOSHI, INDORE. DUBAI AND AFTER DISCUSSING THE DETAILS OF VARIOUS O VERSEAS COMPANIES FINALLY HELD THAT THE ASSESSEE ALONG WITH SHRI RITESH AJMERA AND SOME SHRI CHITRESH MEHTA HAVE MAD E SUBSTANTIAL INVESTMENT IN THE PROJECT THE WORLD A T DUBAI. THEREAFTER, THE AO BY HOLDING UNEXPLAINED INVESTMEN T IN DUBAI PROJECT BY SHRI RITESH AJMERA AND THE ASSESSE E RESPECTIVELY AT RS. 15,40,00,000/- AND RS.5,60,50,0 00/- MADE AN ADDITION OF RS.5,60,50,000/- IN THE ASSESSE ES INCOME FOR THE ASSESSMENT YEAR UNDER CONSIDERATION UNDER THE HEAD DUBAI HAWALA. THE RELEVANT FINDINGS OF T HE ASSESSING OFFICER ARE RECORDED AT PARA 7.1 TO 7.7 A T PAGE NO.22 TO 35 OF THE ASSESSMENT ORDER. THE LD. CIT(A), AFTER CONSIDERING THE SUBMISSION OF THE ASSESSEE, DELETED THE ADDITION OF RS.5,60,50,000/- BY GIVING HIS FINDINGS AT PARA 12.4 TO 12.18 OF HIS OR DER. FINDINGS ARE REPRODUCED HEREUNDER:- 12.4 I HAVE CONSIDERED THE AOS ORDER AS WELL AS THE APPELLANTS A/R SUBMISSION AND ALSO VARIOUS DOCUMENTS PLACED ON RECORD. CONSIDERING ALL THE FACTUAL POSITION OF THE CASE, I AM OF THE CONSIDERED VIEW THAT THE IMPUGNED ADDITION HAS BEEN MADE BY THE AO WITHOUT HAVING ANY COGENT MATERIAL OR CORROBORATIVE EVIDENCE ON RECORD. THEREFORE, I FIND NO SUBSTANCE IN THE IMPUGNED ADDITION BEING DEVOID OF ANY MERIT. 12.5 IN ADDITION TO THIS, I ALSO FIND THAT THE OBSERVATIONS AND FINDINGS OF THE AO IN THE IMPUGNED ORDER ARE IN RADICAL CONTRADICTION TO EACH OTHER. I FIND THAT AT THE PARA 7.3, THE AO HAS GIVEN THE FINDING THAT SOME PERSONS LIKE SHRI NILESH AJMERA, SMT. SONALI AJMERA, SHRI RITESH AJMERA AND OTHERS BELONGING TO SATELLITE GROUP HAVE INVESTED IN THE WORLD PROJECT BY ACQUIRING AN ISLAND I.E. D 49. HOWEVER, AT THE CONCLUSION PART OF PARA 7.4.5(V), THE AO HAS I.T.A.NO. 537/IND/2015 A.Y.2009-10 PAGE 11 OF 27 SHRI SHARAD DOSHI, INDORE. STATED AS THE PURCHASER OF THE ISLAND D 49 ARE M/S NEEL 1 LTD. AND M/S C.S. DEVELOPERS LTD.. THE AO AGAIN AT PARA 7.4.5(VI), STATED THAT THEREFORE, FROM THE ABOVE IT IS EVIDENT THAT THE PURCHASER OF THE ISLAND D49 WERE M/S NEEL 1 LIMITED AND M/S C S DEVELOPERS. HOWEVER, IT IS IMPERATIVE TO FIND OUT THE MAIN PERSONS BEHIND THESE CONCERNS AND THE DEAL OF D49. THE AO AT CONCLUDING PARA 7.7, HAS GIVEN A FINDING AS REGARD UNEXPLAINED INVESTMENT BY THE APPELLANT AND SHRI RITESH AJMERA IN DUBAI PROJECT WHEREAS AT PARA 7.5, THE AO HAS HELD UNEXPLAINED INVESTMENT ON ACCOUNT OF DUBAI HAWALA. THE AO AGAIN AT PARA 7.4.7 OF THE ORDER, STATED THAT VARIOUS PERSONS, WHO WERE PART OF NEEL 1 LTD., HAVE MADE SUBSTANTIAL INVESTMENT IN THE PROJECT AT DUBAI BUT WHILE MAKING THE ADDITION AT PARA 7.7 THE AO HAS HELD THE INVESTMENT IN THE DUBAI PROJECT BY THE APPELLANT AND SHRI RITESH AJMERA IN THEIR INDIVIDUAL CAPACITY. IN THE CONCLUDING PARA I.E. AT PARA 7.7, THE AO HAS GIVEN THE FINDING AS REGARD TO SOME UNEXPLAINED INVESTMENT IN DUBAI PROJECT BUT IN THE COMPUTATION PART OF THE ORDER THE A.O. HAS USED THE TERMINOLOGY AS DUBAI HAWALA. FROM ALL SUCH CONTRADICTION, I AM OF THE CONSIDERED VIEW THE ADDITION HAS BEEN MADE MERELY ON GUESS WORK AND CONJECTURES. IN MY CONSIDERED VIEW, IF AS PER THE AOS OWN FINDINGS, THE SUBJECT PROPERTY HAS BEEN PURCHASED BY SOME M/S. NEEL 1 LTD. AND M/S. C S DEVELOPERS LTD., NO ADDITION BY ALLEGING UNEXPLAINED INVESTMENT IN THE SAME PROPERTY CAN BE MADE IN THE HANDS OF THE APPELLANT. IN THE INSTANT CASE, AS PER THE AOS OWN FINDINGS, THE OSTENSIBLE OWNERS OF THE PROPERTY AT DUBAI ARE ONLY M/S. NEEL 1 LTD. AND M/S. C S DEVELOPERS LTD. THEREFORE, UNLESS AND UNTIL IT IS ESTABLISHED THAT THE APPELLANT WAS THE I.T.A.NO. 537/IND/2015 A.Y.2009-10 PAGE 12 OF 27 SHRI SHARAD DOSHI, INDORE. REAL OWNER OF THE PROPERTY AND THE ABOVE ENTITIES WERE ONLY BENAMIDARS OF THE APPELLANT, IN MY CONSIDERED VIEW, NO UNEXPLAINED INVESTMENT IN THE SAID PROPERTY CAN BE PRESUMED TO HAVE BEEN MADE BY THE APPELLANT. FOR THIS PROPOSITION, MY VIEW ALSO GETS SUPPORT FROM THE PRONOUNCEMENT OF HONBLE HIGH COURT OF KERALA IN THE CASE OF CIT VS. K. MAHIM UDMA (2000) 242 ITR 133 (KER.). 12.6 FURTHER I FIND SUBSTANCE IN THE SUBMISSION OF APPELLANTS A/R THAT THE ONLY BASIS TAKEN BY THE AO FOR MAKING THE IMPUGNED ADDITION IS CERTAIN LOOSE PAPERS/ COMPUTER PRINTOUTS WHICH WERE NOT RECOVERED FROM THE POSSESSION OR CONTROL OF THE APPELLANT BUT THE SAME WERE RECOVERED ONLY FROM A COMPANY NAMELY M/S. PHOENIX DEVCONS PVT. LTD., IN WHICH THE APPELLANT WAS MERELY ONE OF THE DIRECTORS. THE AO COULD NOT BRING ANY EVIDENCE ON RECORD THAT THE LOOSE PAPERS SO FOUND WERE EITHER IN THE HANDWRITING OF THE APPELLANT OR THEY WERE PREPARED UNDER THE INSTRUCTION OF THE APPELLANT. IN SUCH CIRCUMSTANCES, IN MY CONSIDERED VIEW, THE PROVISIONS OF SECTION 292C GIVING PRESUMPTION AS REGARD TO THE TRUENESS OF SUCH DOCUMENTS WOULD HAVE NO APPLICATION. 12.7 I FIND THAT THE PROVISIONS OF S.292C HAVE BEEN INSERTED IN THE STATUTE BY THE FINANCE ACT, 2007 W.R.E.F. 1.10.1975 TO EMPOWER THE INCOME TAX AUTHORITIES TO MAKE CERTAIN PRESUMPTIONS ON BOOKS OF ACCOUNT, OTHER DOCUMENTS, MONEY, BULLION, JEWELLERY OR OTHER VALUABLE ARTICLE OR THING FOUND IN THE POSSESSION OR CONTROL OF ANY PERSON IN THE COURSE OF A SEARCH UNDER S.132 EVEN FOR THE PURPOSE OF ASSESSMENT. SUCH PROVISION HAS BEEN INSERTED IN THE BACKGROUND OF DECISION OF HONBLE APEX COURT IN THE CASE OF P.R. METRANI VS. CIT (2006) 287 ITR 209 (SC) IN I.T.A.NO. 537/IND/2015 A.Y.2009-10 PAGE 13 OF 27 SHRI SHARAD DOSHI, INDORE. WHICH THE APEX COURT HELD THAT THE PRESUMPTION UNDER S.132(4A) IS NOT AVAILABLE FOR THE ASSESSMENT PROCEEDINGS. THE PHRASEOLOGY USED IN SUB-ECTION (1) OF SECTION 292C IS PARA-MATERIA WITH THAT OF SECTION 132(4A). I FIND THAT MANY JUDICIAL AUTHORITIES IN THE CONTEXT OF PROVISIONS O F SECTION 132(4A) HAVE CLEARLY LAID DOWN THE RATIO THAT THE PRESUMPTION UNDER S.132(4A) IS AVAILABLE ONLY AGAINST THE PERSON FROM WHOSE POSSESSION THE DOCUMENT IS FOUND AND SUCH PRESUMPTION IS NOT AVAILABLE AGAINST ANY THIRD PARTY. FOR THIS PROPOSITION SUPPORT IS DRAWN FROM THE JUDICIAL PRONOUNCEMENTS IN THE CASE OF SMT. BOMMANA SWARNA REKHA VS. ACIT (2005) 94 TTJ (VISAKHA) 885, STRAPTEX (INDIA) (P) LTD. VS. DCIT (2003) 79 TTJ (MUMBAI) 228, JAYA S. SHETTY VS. ACIT (1999) 64 TTJ (MUMBAI) 551, ASHWANI KUMAR VS. ITO (1992) 42 TTJ (DEL) 644, KISHANCHAND SOBHRAJMAL VS. ACIT (1992) 42 TTJ (JP) 423, RAMA TRADERS VS. FIRST ITO (1988) 32 TTJ (PAT) 483 (TM), ACIT VS. KISHORE LAL BALWANT RAI & ORS. (2007) 17 SOT 380 (CHD), SHETH AKSHAY PUSHPAVADAN VS. DCIT (2010) 130 TTJ (AHD) (UO) 42. 12.8 ACCORDINGLY, IN MY CONSIDERED VIEW, WITHOUT BRINGING ANY CORROBORATIVE EVIDENCE AND COGENT MATERIAL ON RECORD, MERELY ON THE BASIS OF SUCH LOOSE PAPERS UNLESS AND UNTIL DETAILS NOTED THEREIN IS EVIDENCED WITH DOCUMENTARY EVIDENCE OF ANY SUCH TRANSACTION, NO ADVERSE INFERENCE OUGHT TO HAVE BEEN DRAWN AGAINST THE APPELLANT MERELY ON SUSPICION AND CONJECTURES. THE HONBLE APEX COURT, IN THE CASE OF DHAKESWARI COTTON MILLS LTD. VS. CIT (1954) 26 ITR 775 (SC), HAS HELD THAT WHILE MAKING AN ASSESSMENT, THERE MUST SOMETHING MORE THAN BARE SUSPICION TO SUPPORT THE ASSESSMENT. THE APEX COURT, AGAIN IN THE CASE OF LALCHAND I.T.A.NO. 537/IND/2015 A.Y.2009-10 PAGE 14 OF 27 SHRI SHARAD DOSHI, INDORE. BHAGAT AMBICA RAM VS. CIT (1959) 37 ITR 288 (SC) HELD THAT WHERE ANY FACT FINDING AUTHORITY ACTS WITHOUT ANY EVIDENCE OR UPON A VIEW OF THE FACTS WHICH COULD NOT REASONABLY BE ENTERTAINED OR THE FACTS FOUND WERE SUCH THAT NO PERSON ACTING JUDICIALLY AND PROPERLY INSTRUCTED AS THE RELEVANT LAW COULD HAVE FOUND, THE COURT IS ENTITLED TO INTERFERE. 12.9 I ALSO FIND SUBSTANCE IN THE CONTENTION OF THE APPELLANTS A/R THAT THE LOOSE PAPERS INVENTORISED AS PAGE NO.75 TO 78 OF LPS-33 (XEROX COPIES WHEREOF HAVE BEEN GIVEN BY THE AO HIMSELF AT PAGE NO.29 TO 32 OF THE IMPUGNED ORDER), WHICH ARE BASICALLY IN THE NATURE OF COMPUTERIZED EXCEL SHEET PRINTOUTS ONLY, NO SIGNIFICANT DETAILS HAVE BEEN GIVEN BY A.O. IN THE ASSESSMENT ORDER. I FURTHER FIND THAT IN ONE OF THE ABOVE SAID LOOSE PAPERS THERE IS ANY REFERENCE OF ANY DATE/ MONTH OR YEAR. THEREFORE, IT CANNOT BE PERCEIVED FROM SUCH LOOSE PAPERS THAT TO WHICH PERIOD SUCH LOOSE PAPERS PERTAIN. 12.10 FURTHER FROM A PERUSAL OF SUCH COMPUTERIZED SHEETS, THE VITAL DETAILS SUCH AS THE VERY PURPOSE OF PREPARING SUCH SHEETS, THE NAME OF THE PERSON PUNCHING THE DATA IN COMPUTER FOR MAKING SUCH SHEETS, THE NAME OF THE PERSON OR THE ENTITY FOR WHICH SUCH DATAS WERE FED IN THE COMPUTER ARE ALSO NOT DISCERNIBLE. FURTHER, IT IS NOT CLEAR THAT WHETHER SUCH DATAS PERTAIN TO THE RECEIPT OF MONEY OR PAYMENT OF MONEY. IT IS A SETTLED LAW THAT NO ADDITION CAN BE MADE ON THE BASIS OF ANY NON- SPEAKING DOCUMENT. THE HONBLE HIGH COURT OF DELHI, IN THE CASE OF CIT VS. GIRISH CHAUDHARY (2008) 296 ITR 619 (DEL) HELD THAT BEFORE AN ADDITION OF UNDISCLOSED CAN BE MADE, THE AO HAS TO BRING ON RECORD THE MATERIAL FOUND AS A I.T.A.NO. 537/IND/2015 A.Y.2009-10 PAGE 15 OF 27 SHRI SHARAD DOSHI, INDORE. RESULT OF SEARCH TO SHOW THAT THERE IS AN UNDISCLOSED INCOME. MY VIEW ALSO GETS SUPPORT FROM VARIOUS DECISIONS I.E. ACIT VS. ASHOK KUMAR VIG (2007) 106 TTJ (RANCHI) 422, M.M. FINANCIERS (P) LTD. VS. DCIT (2007) 107 TTJ (CHENNAI) 200, DIMSY FOODS & CHEMICALS (P) LTD. VS. DCIT (2007) 110 TTJ (DEL) 450, ACIT VS. RAVI AGRICULTURAL INDUSTRIES (2009) 121 TTJ (AGRA) TM 903, MAHAAN FOODS LTD. VS. DCIT (2009) 27 DTR (DEL) (TRIB) 185, NAGARJUNA CONSTRUCTION CO. LTD. VS. DCIT (2012) 52 SOT 178 (HYD.), ACIT VS. SATYAPAL WASSAN (2008) 5 DTR (JAB) (TRIB) 202, GYANKUMAR AGARWAL (IND.) VS. ACIT (2012) 146 TTJ (HYD.) 334, JAGDAMBA RICE MILLS VS. ACIT (2000) 67 TTJ (CHD) 838, RAKESH GOYAL VS. ACIT (2004) 87 TTJ (DEL) 151, N.K. MALHAN VS. DCIT (2004) 91 TTJ (DEL) 938, BRIJLAL RUPCHAND VS. ITO (1991) 40 TTJ (IND.) 668, RAJ PAL SINGH RAM AUTAR VS. ITO (1991) 39 TTJ (DEL) 544, EMBEE CLEARING & SHIPPING SERVICES (P) LTD. VS. ACIT (2007) 12 SOT 227 MUMBAI). 12.11 I FIND THAT THE HONBLE ITAT, DELHI ABENCH IN THE CASE OF BANSAL STRIPS (P) LTD. & ORS. VS. ACIT (2006) 100 TTJ (DEL) 665, HAS HELD AS UNDER: 36. WE HAVE CAREFULLY CONSIDERED THE RIVAL SUBMISSIONS. WE SEE FORCE IN THE CONTENTION OF THE ASSESSEE THAT THERE IS NO PROVISION OF LAW UNDER WHICH THE ADDITION OF RS.53,69,260 COULD BE MADE TO THE INCOME DECLARED BY THE ASSESSEE. IT IS TRITE LAW THAT IF AN INCOME NOT ADMITTED BY AN ASSESSEE IS TO BE ASSESSED IN THE HANDS OF THE ASSESSEE, THE BURDEN TO ESTABLISH THAT THERE IS SUCH INCOME CHARGEABLE TO TAX IS ON THE AO. WITH A VIEW TO ASSIST THE AO AND TO REDUCE THE RIGOUR OF THE BURDEN THAT I.T.A.NO. 537/IND/2015 A.Y.2009-10 PAGE 16 OF 27 SHRI SHARAD DOSHI, INDORE. LAY UPON THE AO, PROVISIONS OF SS. 68, 69, 69A TO 69D HAVE PROVIDED FOR CERTAIN DEEMING PROVISIONS WHERE AN ASSUMPTION OF INCOME IS RAISED IN THE ABSENCE OF SATISFACTORY EXPLANATION FROM THE ASSESSEE. AS THERE ARE DEEMING PROVISIONS THE CONDITION PRECEDENT FOR INVOKING SUCH PROVISIONS ARE REQUIRED TO BE STRICTLY CONSTRUED. THE FACTS AND CIRCUMSTANCES GIVING RISE TO THE PRESUMPTION HAVE TO E ESTABLISHED WITH REASONABLE CERTAINTY. THE AO CANNOT FIRST MAKE CERTAIN CONJECTURES AND SURMISES AND THEREAFTER APPLY THE DEEMING PROVISIONS BASED ON SUCH CONJECTURES AND SURMISES. IN THE ABSENCE OF ADEQUATE MATERIAL AS TO THE NATURE AND OWNERSHIP OF THE TRANSACTION, UNDISCLOSED INCOME CANNOT BE ASSESSED IN THE HANDS OF THE ASSESSEE MERELY BY ARITHMETICALLY TOTALING VARIOUS FIGURES JOTTED DOWN ON THE LOOSE DOCUMENTS. IN OTHER WORDS FOR THE PURPOSE OF RESORTING TO DEEMING PROVISIONS, DUMB DOCUMENTS OR DOCUMENTS WITH NO CERTAINTY HAVE NO EVIDENTIARY VALUE.. 12.12 THE HONBLE ITAT, PATNA IN THE CASE OF ACIT VS. DR. KAMLA PRASAD SINGH (2010) 3 ITR (TRIB) 533 (PAT) HAS ALSO HELD THAT NO ADDITIONS CAN BE SUSTAINED IN THE FOLLOWING WORDS: HAVING CONSIDERED THE RIVAL SUBMISSIONS, THE PROVISIONS RELATING TO ASSESSMENT FOR THE BLOCK PERIOD UNDER CHAPTER XIV-B OF THE ACT AND THE ASSESSEES CASE INCLUDING THE DOCUMENTS UNDER REFERENCE, WHICH HAVE BEEN MADE ANNEXURE TO THIS ORDER ALSO, WE ARE OF THE OPINION THAT IT IS NOW WELL SETTLED THAT UNDISCLOSED INCOME FOR THE PURPOSE OF BLOCK ASSESSMENT HAS TO BE I.T.A.NO. 537/IND/2015 A.Y.2009-10 PAGE 17 OF 27 SHRI SHARAD DOSHI, INDORE. COMPUTED SOLELY ON THE BASIS OF SEIZED MATERIAL AND ANY ENQUIRY MADE BY THE AO THEREAFTER RELATABLE TO SUCH MATERIAL; MEANING THEREBY NEITHER ANY ENQUIRY REPORT NOR ANY DOCUMENT PROCURED EITHER BEFORE OR AFTER THE SEARCH CAN BE CONSIDERED WHILE COMPUTING THE UNDISCLOSED INCOME. SIMILARLY, IT IS ALSO SETTLED LAW THAT ANY DOCUMENT FOUND AND SEIZED DURING THE COURSE OF SEARCH HAS TO BE INTERPRETED LITERALLY AND NOTHING CAN BE ADDED OR SUBSTRACTED. IF FACTS OF THE ASSESSEES CASE BEFORE US ARE EVALUATED IN THE LIGHT OF THE AFORESAID SETTLED PRINCIPLES OF LAW, IT WILL BE REVEALED THAT THE DOCUMENTS FOUND AND SEIZED AND RELIED UPON FOR MAKING THE ADDITION UNDER APPEAL BY THE REVENUE HAVE NEITHER DATE NOR THE NAME OF THE ASSESSEE AND THEREFORE, IT CANNOT BE ASSUMED OR PRESUMED AS TO WHEN AND BY WHOM THE NOTINGS WERE RECORDED. IT IS ALSO NOT KNOWN AS TO IN WHAT CONNECTION THE NOTINGS EVEN IF CONSIDERED AS GIVING AND TAKING OF MONEY WERE MADE; MEANING THEREBY THAT THESE DOCUMENTS BEING DUMB DOCUMENTS, NO ADDITION CAN BE MADE ON THE BASIS OF ASSUMING OR PRESUMING THE NOTINGS IN THOSE DOCUMENTS RELATING TO ANY OTHER TRANSACTION NOR RECORDED IN THE DOCUMENTS. IN A NUTSHELL, ANY INFIRMITY IN THE ORDER OF THE CIT (A) ON THIS POINT (SIC) AND THEREFORE, FOLLOWING THE LAW LAID DOWN IN VARIOUS DECISIONS RELIED UPON BY THE ASSESSEE IN ITS SYNOPSIS, WE UPHOLD THE ORDER OF THE CIT (A) ON THIS POINT. THE REVENUES GROUND IS REJECTED. I.T.A.NO. 537/IND/2015 A.Y.2009-10 PAGE 18 OF 27 SHRI SHARAD DOSHI, INDORE. 12.13 THE HONBLE ITAT, JABALPUR BENCH, IN THE CASE OF ACIT VS. SATYAPAL WASSAN (2008) 5 DTR (JAB) (TRIB) 202 HAS HELD THAT UNLESS, IN ANY CASE, A DOCUMENT FULFILS FOUR ESSENTIAL COMPONENTS VIZ., THE TAXABLE EVENT, THE PERSON CHARGEABLE, THE ASSESSMENT YEAR IN WHICH CHARGE IS LEVIABLE AND THE TOTAL INCOME, IT HAS NO EVIDENTIARY VALUE AND CANNOT BE RELIED UPON IN FOLLOWING WORDS: 19. THE ABOVE DECISION ALSO LEADS US TO INFER THAT A CHARGE ON THE BASIS OF DOCUMENT CAN BE LEVIED ONLY WHEN THE DOCUMENT IS A SPEAKING ONE. THE DOCUMENT SHOULD SPEAK EITHER OUT OF ITSELF OR IN THE COMPANY OF OTHER MATERIAL FOUND ON INVESTIGATION AND OR IN THE SEARCH. THE SPEAKING FROM THE DOCUMENT SHOULD BE LOUD, CLEAR AND UNAMBIGUOUS IN RESPECT OF ALL THE FOUR COMPONENTS AS DESCRIBED ABOVE. IF IT IS NOT SO, THEN DOCUMENT IS ONLY A DUMB DOCUMENT. NO CHARGE CAN BE LEVIED ON THE BASIS OF A DUMB DOCUMENT. 12.14 THE HONBLE HIGH COURT OF GUJARAT IN THE CASE OF USHAKANT N. PATEL VS. CIT 92006) 282 ITR 553 (GUJ.) HAS PRONOUNCED THAT BEFORE INVOKING THE PROVISIONS OF S.69 OF THE ACT, IT IS INCUMBENT UPON THE AUTHORITY TO ESTABLISH THAT THERE WERE INVESTMENTS MADE BY THE ASSESSEE; THAT SUCH INVESTMENTS WERE NOT RECORDED IN THE BOOKS OF ACCOUNTS MAINTAINED BY THE ASSESSEE AND THAT SUCH INVESTMENTS HAD BEEN MADE IN THE FINANCIAL YEAR IMMEDIATELY PRECEDING THE ASSESSMENT YEAR IN QUESTION AND WITHOUT SATISFYING THE PRE-REQUISITE CONDITIONS OF S. 69 OF THE ACT, AO CANNOT MAKE ANY ADDITION BY INVOKING THE PROVISIONS OF S.132(4A) OF THE ACT. I.T.A.NO. 537/IND/2015 A.Y.2009-10 PAGE 19 OF 27 SHRI SHARAD DOSHI, INDORE. 12.15 I ALSO FIND SUBSTANCE IN THE APPELLANTS A/RS CONTENTION THAT THE VARIOUS LOOSE PAPERS OF LPS-33, AS DISCUSSED BY THE AO AT PARAS 7.4.1 TO PARA 7.4.5 HAVE NO LIVE LINK OR NEXUS WITH THE KEY PAGE I.E. PAGE NO.76 OF LPS- 33 AT WHICH THERE IS A MENTIKON WITH THE NARRATION NILESH AJMERA RS.5,55,00,000 AND 55,000; 50,00,000 AND 50,000 DHS CASH. I FIND THAT ON SUCH PAGE THE TOTAL UNDER THE COLUMN OF DHS HAS BEEN STATED AT 3,38,16,050 WHICH DO NOT TALLY WITH ANY OF THE FIGURES STATED AT PARA 7.4.5 (I) OF THE AOS ORDER. IN MY CONSIDERED VIEW, THE AO COULD NOT ESTABLISH THAT THE SUBJECT LOOSE PAPER, I.E. PAGE NO.76 OF LPS-33, PERTAINS ONLY TO THE PROJECT THE WORLD AS REFERRED TO BY THE AO AT VARIOUS PARTS OF THE ORDER. IN MY CONSIDERED VIEW, THE AO HAS MADE THE IMPUGNED ADDITION MERELY ON ASSUMPTION/HYPOTHESIS ONLY. IN SUCH CIRCUMSTANCES, RELYING UPON THE DECISION OF THE HONBLE APEX COURT IN THE CASE OF OMAR SALAY MOHAMED SAIT VS. CIT (1959) 37 ITR 151 (SC), I DO NOT FIND JUSTIFICATION IN THE ACTION OF THE A.O. OF MAKING SUCH ADDITION. 12.16 FURTHER, IN MY CONSIDERED VIEW, IF THE APPELLANT HAD MADE ANY INVESTMENT IN DUBAI, AS ALLEGED BY THE AO THEN AT LEAST SOME DOCUMENTS SUCH AS MONEY RECEIPTS, PURCHASE AGREEMENT, TITLE DEED ETC. COULD HAVE BEEN FOUND FROM ANY OF THE PREMISES OF THE APPELLANT OR HIS ASSOCIATES. HOWEVER, NEITHER DURING THE COURSE OF SEARCH NOR DURING THE COURSE OF ASSESSEMENT PROCEEDINGS, EVEN THE EXISTENCE OF SUCH PAPERS HAS BEEN BROUGHT ON RECORD. FURTHER, FROM THE FINDINGS GIVEN BY THE AO HIMSELF IN THE IMPUGNED ORDER, I FIND THAT THE COMPANY M/S. NEEL 1 LTD. OR NEEL HOLDINGS LTD., IN WHICH ACCORDING TO THE AO THE APPELLANT OR I.T.A.NO. 537/IND/2015 A.Y.2009-10 PAGE 20 OF 27 SHRI SHARAD DOSHI, INDORE. HIS ASSOCIATES WERE HAVING VESTED INTEREST, ARE FOREIGN COMPANIES. I FURTHER FIND THAT THE AO COULD NOT BRING ON RECORD EVEN AN IOTA OF ANY EVIDENCE THROUGH WHICH IT CAN BE ESTABLISHED THAT THE APPELLANT MADE ANY INVESTMENT IN SUCH COMPANIES FROM THE FUNDS REMITTED FROM INDIA. I COULD NOT FIND FROM THE MATERIAL ON RECORD THAT DURING THE COURSE OF SEARCH IN THE PREMISES OF THE APPELLANT, ANY SUCH EVIDENCE SUCH AS ANY SHARE CERTIFICATE, MONEY RECEIPT OR ANY OTHER DOCUMENT ESTABLISHING SUCH INVESTMENT BY THE APPELLANT COULD BE FOUND. 12.17 I ALSO FIND SUBSTANCE IN THE APPELLANTS A/R SUBMISSION THAT ANY REMITTANCE OUT OF INDIATHROUGH THE HAWALA ROUTE IS A SERIOUS PUNISHABLE CRIME AND THERE ARE VARIOUS AGENCIES SUCH AS ENFORCEMENT DIRECTOR, FEMA AUTHORITIES ETC. TO HAVE A CHECK ON SUCH TRANSACTIONS. THE CONTENTION OF THE APPELLANTS A/R IS THAT THE INCOME TAX DEPARTMENT HAD MADE A REFERENCE OF THE ALLEGED TRANSACTIONS TO THE ABOVE AUTHORITIES AND SUCH AUTHORITIES, AFTER MAKING NECESSARY ENQUIRIES DID NOT FIND ANY SUBSTANCE IN THE STAND OF THE INCOME TAX DEPARTMENT. ALTHOUGH, THE A/R OF THE APPELLANT COULD NOT PRODUCE ANY DOCUMENTARY EVIDENCE IN SUPPORT OF MAKING OF ANY REFERENCE BY THE DEPARTMENT TO ENFORCEMENT DIRECTOR OR FEMA AUTHORITIES NOR IN SUPPORT OF HIS SUCH ASSERTION IN RESPECT OF OUTCOME OF SUCH ENQUIRY. FURTHER, EVEN I FIND THAT THE AO HAS NOT BROUGHT ON RECORD ANY ADVERSE FINDING EITHER OF ENFORCEMENT DIRECTOR OR OF THE FOREIGN TAXATION DIVISION OF CBDT IN RESPECT OF THE ALLEGED HAWALA TRANSACTIONS. 12.18 TAKING NOTE OF ALL THE FACTUAL POSITION OF THE CASE, IN MY CONSIDERED VIEW, THE IMPUGNED ADDITION MADE BY THE AO ON ACCOUNT I.T.A.NO. 537/IND/2015 A.Y.2009-10 PAGE 21 OF 27 SHRI SHARAD DOSHI, INDORE. OF DUBAI HAWALA AT RS.5,60,50,000/- IS DEVOID OF ANY MERIT. ACCORDINGLY, THE ADDITION SO MADE BY THE A.O. IS DELETED. IN THE RESULT, APPELLANTS APPEAL IS ALLOWED. HOWEVER, I WOULD LIKE TO MENTION VERY CATEGORICALLY THAT IF IN FUTURE, THE ENFORCEMENT DIRECTORATE OR FEM AUTHORITIES OR ANY OTHER AUTHORITIES REGULATING THE REMITTANCE OF MONEY FROM INDIA GIVES ANY CONCLUSIVE FINDING AS REGARD TO MAKING OF THE IMPUGNED HAWALA TRANSACTION BY THE APPELLANT, THEN THE A.O. WOULD BE FREE TO TAKE NECESSARY ACTION IN ACCORDANCE WITH THE PROVISION OF LAW. THE LD. AR HAS MADE ORAL SUBMISSION AS WELL AS WRITTEN SUBMISSION AS UNDER: AT THE OUTSET, WE WISH TO PLACE RELIANCE ON THE VARIOUS FINDINGS GIVEN BY THE LEARNED CIT(A) IN HIS ORDER. IT MAY BE APPRECIATED THAT THE DRS COULD NOT CONTROVERT ANY OF THE FINDINGS OF THE CIT(A). ON A PERUSAL OF THE LOOSE PAPERS INVENTORIZED AS PAGE NO. 75, 76 & 77 OF LPS-33, AS PLACED AT PAGE NO.131 TO 133 OF THE PAPER BOOK, [COPIES WHEREOF HAVE ALSO BEEN MADE PART OF THE ASSESSMENT ORDER], IT MAY BE OBSERVED THAT SUCH LOOSE PAPERS ARE BASICALLY DUMB DOCUMENTS. THESE DOCUMENTS DO NOT CONTAIN ANY DATE OR PERIOD. THESE DOCUMENTS ALSO NOT CONTAIN THE DETAILS THAT WHETHER THESE ARE IN THE NATURE OF RECEIPTS OR PAYMENTS. IT MAY ALSO BE OBSERVED THAT NO CORROBORATIVE EVIDENCE FOR THE ENTRIES MADE IN THESE LOOSE PAPERS HAVE BEEN BROUGHT ON RECORD BY THE AO. IT IS SUBMITTED THAT THE RELIANCE BY THE AO ON SOME INTERNET I.T.A.NO. 537/IND/2015 A.Y.2009-10 PAGE 22 OF 27 SHRI SHARAD DOSHI, INDORE. INFORMATION IS MISPLACED AS IT HAS NO DIRECT NEXUS WITH THE LOOSE PAPERS FOUND DURING THE COURSE OF SEARCH. ON THE OTHER HAND, IT MAY BE OBSERVED THAT THE AO HAS GIVEN CONTRADICTORY FINDINGS IN HIS ORDER INASMUCH AT SOME PLACES THE AO HAS ALLEGED THAT THE ASSESSEE HAS MADE INVESTMENT IN CERTAIN PROPERTIES IN DUBAI AND AT SOME OTHER PLACES THE AO HAS STATED THAT SOME COMPANIES LIKE M/S. NEEL 1 LTD. AND M/S. C.S. DEVELOPERS HAVE MADE INVESTMENT IN SUCH PROPERTIES. THUS, THE FINDINGS OF THE AO ARE NOT GERMANE FROM THE FACTS AND MATERIAL ON THE RECORD. IT IS SUBMITTED THAT VARIOUS JUDICIAL RULINGS CITED BY THE CIT(A) IN HIS ORDER ARE APPLICABLE IN THE PRESENT CASE. IT IS FURTHER SUBMITTED THAT THE CIT(A) HAS GIVEN A CATEGORICAL FINDING THAT IN THE ASSESSEES CASE, FOR THE ALLEGED DUBAI HAWALA, NO ACTION HAS BEEN TAKEN BY THE OTHER GOVERNMENT AGENCIES SUCH AS ENFORCEMENT DIRECTOR, FEMA AUTHORITIES, ETC.. IT SHALL BE APPRECIATED THAT THE LEARNED CIT(A) HAS NOT GIVEN ABSOLUTE RELIEF TO THE ASSESSEE BUT IT HAS DELETED THE ADDITION WITH A SPECIFIC DIRECTION THAT IN FUTURE IF THE ENFORCEMENT DIRECTOR OR FEMA AUTHORITIES OR ANY AUTHORITIES REGULATING THE REMITTANCE OF MONEY FROM INDIA GIVES ANY CONCLUSIVE FINDING AS REGARD TO MAKING OF HAWALA TRANSACTION BY THE ASSESSEE, THEN THE AO WOULD BE FREE TO TAKE NECESSARY ACTION AGAINST THE ASSESSEE IN ACCORDANCE WITH THE PROVISIONS OF LAW. IT IS SUBMITTED THAT UNLESS AND UNTIL THE OTHER AGENCIES WHO HAVE BEEN ENTRUSTED TO HAVE A VIGIL ON REMITTANCE/IN-FLOW OF FUNDS TO/FROM COUNTRIES OUTSIDE INDIA DO NOT COME TO A CONCLUSION THAT ANY PERSON HAS MADE/RECEIVED ANY REMITTANCE TO/FROM ABROAD, MERELY ON THE BASIS OF GUESS WORK AND SURMISES IT WOULD NOT I.T.A.NO. 537/IND/2015 A.Y.2009-10 PAGE 23 OF 27 SHRI SHARAD DOSHI, INDORE. BE APPROPRIATE TO CHARGE ANY PERSON FOR SUCH OFFENCE AND CONSEQUENTLY, EVEN UNDER THE PROVISIONS OF THE INCOME-TAX ACT, 1961, NO ADVERSE VIEW DESERVES TO BE DRAWN. ACCORDINGLY, IT IS HUMBLY SUBMITTED THAT THE ORDER OF THE CIT(A) ON THIS GROUND DESERVES TO BE MAINTAINED AND CONSEQUENTLY THE GROUND NO.4 AND 4.1 OF THE REVENUE DESERVES TO BE DISMISSED IN LIMINE. LD. DR RELIED ON THE ORDER OF THE AO. WE HAVE HEARD THE RIVAL CONTENTIONS OF BOTH THE PARTIES AND HAVE PERUSED THE MATERIAL AVAILABLE ON RECORD. WE FIND THAT DURING THE COURSE OF SEARCH, A LOOSE P APER INVENTORISED AS PAGE NO.75, 76 AND 77 OF LPS-33 WHI CH IS PLACED ON PAPER BOOK AS PAGES 131 TO 133 WAS SEIZED . THE LD. CIT(A) HAS HELD THAT THESE DOCUMENTS ARE DU MB DOCUMENTS. THESE DOCUMENTS DO NOT CONTAIN ANY DATE OR PERIOD. THESE DOCUMENTS ALSO DO NOT CONTAIN DETAILS THAT WHETHER THESE ARE OF NATURE OF RECEIPT OR PAYMENT. THE AO HAS NOT MADE ANY INQUIRY AFTER LOOSE PAPER FOUND. T HE AO HAS HELD THAT SOME COMPANIES LIKE, M/S. NEEL I LTD. AND M/S. CS DEVELOPERS HAS MADE INVESTMENT IN THEIR PROPERTY. WE FIND THAT LD. CIT(A) HAS HELD THAT THE AO HAS NOT MADE ANY INQUIRY WHETHER THE ASSESSEE HAS MADE INVESTMENT IN THE DUBAI PROPERTY OR IN M/S. NEEL 1 LTD. OR CS DEVELOPERS WHO HAVE ALLEGEDLY MADE INVESTMENT IN THE PROPERTY. THE LD. CIT(A) HAS FURTHER HELD THAT IF A LLEGED DUBAI HAWALA IS MADE BY THE ASSESSEE, NO ACTION HAS I.T.A.NO. 537/IND/2015 A.Y.2009-10 PAGE 24 OF 27 SHRI SHARAD DOSHI, INDORE. BEEN TAKEN BY THE OTHER GOVT. AGENCIES AS ENFORCEME NT DIRECTOR, FEMA AUTHORITIES. THE LD. CIT(A) HAS ALSO GIVEN THE DIRECTION TO THE AO THAT IF THE E.D. OR FEMA AU THORITIES OR ANY AUTHORITIES REGULATING THE REMITTANCE OF MON EY FROM INDIA GIVES ANY CONCLUSIVE FINDING AS REGARD MAKING OF HAWALA TRANSACTION BY THE ASSESSEE THEN THE AO WOUL D BE FREE TO TAKE ACTION AGAINST THE ASSESSEE IN ACCORDA NCE WITH THE PROVISIONS OF LAW. WE FIND THAT WHEN LD. C IT(A) HAS GIVEN THE SPECIFIC DIRECTION AND THE DEPARTMENT IS NOT BRINGING ANY EVIDENCE THAT ASSESSEE HAS MADE ANY INVESTMENT IN THE PROPERTY, NO ADDITION CAN BE MADE ON THE BASIS OF SIMPLE DOCUMENTS FOUND FROM THE POSSESSION OF THE ASSESSEE. WE ARE OF THE VIEW THAT LD. CIT(A) IS JUSTIFIED IN HIS ACTION FOR GIVING THE DIRECTION AND DELEING THE ADDITION OF RS.5,60,50,000/-. WE ARE ALSO IN AGREEM ENT WITH THE DIRECTION OF THE LD. CIT(A), WHICH READS A S UNDER: HOWEVER, I WOULD LIKE TO MENTION VERY CATEGORICALLY THAT IF IN FUTURE, THE ENFORCEMENT DIRECTORATE OR FEM AUTHORITIES OR ANY OTHER AUTHORITIES REGULATING THE REMITTANCE OF MONEY FROM INDIA GIVES ANY CONCLUSIVE FINDING AS REGARD TO MAKING OF THE IMPUGNED HAWALA TRANSACTION BY THE APPELLANT, THEN THE A.O. WOULD BE FREE TO TAKE NECESSARY ACTION IN ACCORDANCE WITH THE PROVISION OF LAW. I.T.A.NO. 537/IND/2015 A.Y.2009-10 PAGE 25 OF 27 SHRI SHARAD DOSHI, INDORE. IN THE RESULT, THE APPEAL OF THE DEPARTMENT ON THIS ISSUE IS DISMISSED. 8. WE HAVE CONSIDERED THE FACTS AND MATERIALS AVAILABL E ON RECORD. ON CONSIDERATION OF ABOVE FACTS AND CIRC UMSTANCES, WE FIND THAT NO SEARCH WAS CARRIED OUT IN THE PREMISE S OF SHRI SHARAD DOSHI AND NO LOOSE PAPER, CASH BOOK OR CASH FLOW STATEMENT WERE FOUND OR SEIZED, WHICH COULD PROVE TH E MOVEMENT OF CASH TO & FRO BETWEEN SHRI SHARAD DOSHI & SHRI NILESH AJMERA WITH RESPECT TO INTEREST AND LOANS. WE FIND THAT THE AO FAILED TO BRING ON RECORD ANY CORROBORATIVE AND CONCRETE EVIDENCE AGAINST THE ASSESSEE WHICH COULD P ROVE THAT THE ASSESSEE HAS ADVANCED MONEY TO SHRI NILESH AJME RA. THE INFERENCE OF THE AO THAT THE ASSESSEE HAS ADVANCED THE MONEY IS MERELY BASED ON SUSPICION, SURMISES AND CONJECTU RES AND THERE WAS NO MATERIAL TO SUPPORT THE CONCLUSION OF T HE AO THAT THE ASSESSEE HAS ADVANCED THE MONEY. WE DERIVE SUPP ORT FROM THE DECISION OF HON'BLE SUPREME COURT IN THE CASE O F DHAKESHWARI COTTON MILL PVT.LTD. VS. CIT, (1954) 26 ITR 775 ( S. C.), WHEREIN IT WAS HELD THAT WHILE MAKING AN ASSES SMENT I.T.A.NO. 537/IND/2015 A.Y.2009-10 PAGE 26 OF 27 SHRI SHARAD DOSHI, INDORE. THERE MUST BE SOMETHING MORE THAN THE BARE SUSPICIO N TO SUPPORT THE ASSESSMENT. IN ANOTHER CASE OF K.P. VA RGHESE VS. ITO, (1981) 131 ITR 597 ( S.C.), THE HON'BLE SUPREM E COURT HAS HELD THAT MERE SEIZURE OF NOTE BOOKS OF DOCUMEN TS AT THE PERSONAL RESIDENCE OF AN EMPLOYEE WOULD NOT CONCLUD E THE ISSUE AGAINST THE EMPLOYER COMPANY THAT THE ON MONE Y HAS BEEN RECEIVED BY THE EMPLOYER COMPANY. THE ONUS OF PROVING THE CHARGING OF ON MONEY LIES ON THE REVENUE. FURTH ER, THE HON'BLE BOMBAY HIGH COURT IN THE CASE OF ACIT VS. L ATA MANGESHKAR (MISS) (1974) 97 ITR 696 (BOM), HAS HELD THAT NO ADDITION COULD BE MADE IN THE HANDS OF THE ASSESSEE ON THE BASIS OF NOTINGS FOUND IN THE BOOKS OF THIRD PERSON . 9. IN VIEW OF FACTS AND CIRCUMSTANCES NARRATED ABOVE, W E FIND THAT THIS ISSUE IS COVERED BY THE DECISION OF THIS TRIBUNAL IN THE CASE OF SHRI NILESH AJMERA ([IT(SS)A NOS.250 & 251/IND/2013, ORDER DATED 17.5.2016] (SUPRA). EVEN BEFORE US, LD. SR. DEPARTMENTAL REPRESENTATIVE WAS NOT ABLE TO CONTROVERT THE FINDING OF THE LD. CIT(A) AS WELL AS THE SUBMISSION OF THE LD. AUTHORIZED REPRESENTATIVE OF THE ASSESSEE BY BRINGING ANY CONTRARY MATERIAL ON RECOR D. THUS, I.T.A.NO. 537/IND/2015 A.Y.2009-10 PAGE 27 OF 27 SHRI SHARAD DOSHI, INDORE. FOLLOWING THE ORDER OF THIS TRIBUNAL (SUPRA) IN THE LIGHT OF ABOVE JUDICIAL PRONOUNCEMENTS, WE DISMISS THE PRESENT APPE AL OF THE REVENUE I.E. I.T.A.NO.537/IND/2015 FOR ASSESSMENT Y EAR 2009-10. 10. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISMISS ED. THE ORDER HAS BEEN PRONOUNCED IN OPEN COURT ON THE 23 RD DECEMBER, 2016. SD/- (..) (D.T.GARASIA) JUDICIAL MEMBER SD/- (..) (O.P.MEENA) ACCOUNTANT MEMBER * / DATED : 23 RD DECEMBER, 2016. CPU* 30.11