ITO 21(3)-2, MUMBAI V. SADIQ ISMAIL KANTHARIA, MUMBAI

ITA 5822/MUM/2009

• Counselvise Citation: 582219914 RSA 2009
• Duration Of Justice: 1 year(s) 9 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-08-2011
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: E
• Next Hearing Date: 13-06-2011
• Assessment Year: 2004-2005
• Appeal Filed On: 03-11-2009
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: G P TRIVEDI
• Assessee Lawyers: PRAKASH PANDIT
• Keywords: Rejection of books of accounts; Cost of acquisition; Corroborative evidences
• Section: 69; 144; 143(3); 133A

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH E MUMBAI BEFORE SHRI R.S. SYAL (AM) AND SMT. ASHA VIJAYARAGHAVAN (JM) ITA NO. 5877/MUM/2009 ASSESSMENT YEAR 2004-05 MR. SADIQ ISMAIL KANTHARIA, KANTHARIA TERRACE, JARI MARI, SAKINAKA, MUMBAI-400 072 PAN-AACCM 5353M VS. THE ITO 21(3)(2), BANDRA KURLA COMPLEX, MUMBAI ITA NO. 5822/MUM/2009 ASSESSMENT YEAR 2004-05 THE ITO 21(3)(2), BANDRA KURLA COMPLEX, MUMBAI VS. MR. SADIQ ISMAIL KANTHARIA, KANTHARIA TERRACE, JARI MARI, SAKINAKA, MUMBAI-400 072 PAN-AACCM 5353M (APPELLANT) (RESPONDENT) ASSESSEE. BY: SHRI PRAKASH PANDIT DEPARTMENT BY: SHRI G.P. TRIVEDI DATE OF HEARING : 9.8.2011 DATE OF PRONOUNCEMENT: O R D E R PER ASHA VIJAYARAGHAVAN (JM) THESE TWO APPEALS ONE FILED BY THE ASSESSEE AND THE OTHER FILED BY THE REVENUE ARE DIRECTED AGAINST THE ORDERS DATED 4.8.2 009 PASSED BY THE LD. CIT(A)-XXI FOR THE ASSESSMENT YEAR 2004-05. ITA NO. 5877/M/09 & 5822/M/09 2 ITA NO. 5877/MUM/2009 ASSESSMENT YEAR 2004-05 2. THE ASSESSEE IS AN INDIVIDUAL DOING BUSINESS OF DAIRY FARM IN THE NAME AND STYLE OF M/S. SADIQ DAIRY FARM. THERE WAS A SUR VEY ACTION U/S. 133A IN THE ASSESSEES PREMISES ON 29.12.2003. THE ASSESSE ES STABLE IS AT ANDHERI AND THE ASSESSEES FAMILY MEMBERS STABLE IS AT VASA I. 3. DURING THE SURVEY OPERATION ALL BOOKS OF ACCOUNT AS WELL AS RELEVANT DOCUMENTS WERE SHOWN TO THE SURVEY OFFICER. DURING THE ASSESSMENT PROCEEDINGS, THE AO ASKED THE ASSESSEE TO EXPLAIN T HE DISCREPANCIES POINTED OUT BY THE SURVEY TEAM. IN THIS REGARD, THE ASSESSE E HAS FURNISHED LETTER DATED 08.02.2006 IN WHICH THE GENERAL CLAIM WAS MAD E IN RESPECT OF SEPARATE BUSINESS OF HIS FAMILY MEMBERS. IT WAS STAT ED THAT THE SURVEY ACTION TOOK PLACE AT THE ASSESSEES BUSINESS PREMISES AN O N THE SAME DATE HIS FATHER, MOTHER AND BROTHER WERE ALSO COVERED. THE A SSESSEES STABLE IS LOCATED AT ANDHERI WHEREAS STABLE OF OTHER FAMILY M EMBERS ARE LOCATED AT VASAI. THERE ARE THREE OTHER PARTIES ALSO WHOSE STA BLE ARE LOCATED NEAR THE ASSESSEES STABLE AT ANDHERI. THESE THREE PARTIES W ERE ALSO COVERED UNDER SURVEY OPERATION AND THE DEPARTMENT HAD CALLED ALL FOUR PARTIES LOCATED AT ANDHERI TO THE INCOME TAX OFFICE AT BANDRA AND TAKE N A JOINT DECLARATION ON A SUBSEQUENT DAY FOR A SUM OF RS.63 LAKH. THE ASSESSE E TOOK OBJECTION TO THIS JOINT DECLARATION AND STATED THAT ALL ASSESSEES ARE SEPARATELY ASSESSED, HAVE SEPARATE BUSINESS AND ARE NOT RELATED TO EACH OTHER AND SUCH STATEMENT CAN HAVE NO VALIDITY. THIS STATEMENT WAS QUICKLY RETRAC TED BY THE ASSESSEE WITHIN A WEEK THROUGH AFFIDAVIT DATED 06.01.2004. AFTER DUE CONSIDERATION OF THE SUBMISSION MADE BY T HE ASSESSEE, THE AO REJECTED THE BOOKS OF ACCOUNT MAINTAINED BY THE ASSESSEE U/S.144 OF THE I.T. ACT AND THE BEST JUDGMENT ASSESSMENT WAS MADE. THE APPARENT REASON FOR REJECTION OF BOOKS OF ACCOUNT IS THAT DISCREPAN CIES POINTED OUT BY THE SURVEY PARTIES WERE NOT REFLECTED IN THE BOOKS OF A CCOUNT. FOLLOWING REASONS ITA NO. 5877/M/09 & 5822/M/09 3 IN PARTICULARS HAVE BEEN CITED IN THE ASSESSMENT OR DER FOR REJECTION OF BOOKS OF ACCOUNT. 1. THE COST OF BUFFALO FOUND AT JARIMARI IS 80 INSTEAD OF 108 AS POINTED OUT BY THE SURVEY PARTIES. 2. LIVE STOCK FOUND AT VASAI IS 346 AS AGAINST THE STO CK AS PER BOOKS IS 360. 3. SURVEY PARTIES HAVE FOUND EXCESS MILK 1800 LTRS. 4. EXCESS MILK OF 4 LTRS. PER ANIMALS WAS NOT SHOWN IN RESPECT OF JARIMARI STABLE. 4. THE ASSESSING OFFICER WHILE COMPLETING THE ASSES SMENT U/S. 143(3) READ WITH SEC. 144 OF THE I.T. ACT MADE CERTAIN ADD ITIONS WHICH WERE CONTESTED BEFORE THE LD. CIT(A). THE FIRST AND SEC OND ADDITION OF RS. 5,60,000/- WAS MADE BY APPLYING PROVISIONS OF SEC. 69 OF THE I.T. ACT BEING THE COST OF 28 BUFFALOES ON ACCOUNT OF DISCREPANCY IN THE STOCK AT JARI MARI STABLE AT ANDHERI KURLA ROAD. 5. THE AO REJECTED THE BOOKS OF ACCOUNTS U/S. 144 O F THE ACT AND MADE THE BEST JUDGEMENT ASSESSMENT. THE REASONS FOR REJ ECTION FOR BOOKS OF ACCOUNT BY THE AO WAS THAT DISCREPANCY POINTED OUT BY THE SURVEY PARTIES WERE NOT REFLECTED IN THE BOOKS OF ACCOUNTS. THE A O HELD THAT BUFFALO FOUND AT JARIMARI WAS 108 AS AGAINST 80 DISCLOSED IN THE BOOKS OF ACCOUNTS HENCE STOCK OF 28 BUFFALO @ RS. 20,000/- PER BUFFALO WHIC H WORKS OUT TO RS. 5,60,000/- WAS ADDED AS UNDISCLOSED INVESTMENT U/S. 69 OF THE I.T. ACT. 6. BEFORE THE LD. CIT(A) THE AR OF THE ASSESSEE CON TENDED THAT THE BASIS OF REJECTION OF BOOKS OF ACCOUNT ITSELF IS WRONG. THE BOOKS WERE PRODUCED WITH SUPPORTING EVIDENCE AND OTHER RELATING DOCUMEN TS. IT WAS SUBMITTED THAT THE ASSESSEE HAD FOLLOWED THE METHOD OF NOT CO NSIDERING EITHER THE NEWLY BORN BUFFALO OR THE DEATH OF BUFFALO. ALTERN ATIVELY THE ASSESSEE CLAIMED THAT DURING THE YEAR THE ASSESSEE HAD PURCHASED 12 BUFFALOS AND SOLD 12 ITA NO. 5877/M/09 & 5822/M/09 4 BUFFALOS AND THE INCREASE AND DECREASE IN THE NUMBE R OF BUFFALO ON ACCOUNT OF BIRTH AND DEATH HAVE CONSISTENTLY NOT BEEN ACCOU NTED FOR THE REASON THAT THE COST OF ACQUISITION IN RESPECT OF CALF IS NIL. 7. THE LD. CIT(A) HELD AS FOLLOWS: I HAVE CAREFULLY CONSIDERED THE ISSUE. THE ISSUE OF REJECTION OF BOOKS OF ACCOUNT IS NOT VERY RELEVANT TO DEAL WITH THE GROUND. THE APPELLANT HAS NOT DISPUTED THE FACT THAT ON THE DATE OF SURVEY, 108 NUMBER OF LIVESTOCK WAS FOUND IN HIS JA RIMARI STABLE AS AGAINST 80 APPEARING IN HIS BOOKS OF ACCOUNT. H E HAS MAINTAINED HIS BOOKS OF ACCOUNT IN THE MANNER THAT BIRTHS AND DEATHS DO NOT GET RECORDED IN THE STOCK. TO THIS E XTENT AT LEAST, THE MANNER OF MAINTAINING HIS BOOKS OF ACCOUNT IS O PEN TO QUESTION. THE BOOKS OF ACCOUNT HAVE TO BE MAINTAIN ED IN THE MANNER THAT IT REPRESENTS THE TRUE INCOME OF AN ASS ESSEE. IN THE CASE OF A LIVESTOCK, AFTER EVERY BIRTH, THERE I S AN INCREASE IN THE VALUE OF STOCK. SIMILARLY, ON EACH DEATH, VALU E OF STOCK GETS DECREASED. ANY ADJUSTMENT MADE BY THE AO TO ACCOUN T FOR THESE DISCREPANCIES IN MAINTENANCE OF BOOKS OF ACCO UNT WOULD THEREFORE, BE JUSTIFIED. FACT OF THE MATTER IS THA T THE APPELLANT HAD SHOWN A STOCK OF 80, WHEREAS HE POSSESSED 108 N UMBER OF LIVESTOCK AND THEREBY THERE WAS UNDERSTATEMENT OF S TOCK BY 28 BUFFALOS. THE VALUE OF BUFFALO HAS NOT BEEN DISPUT ED AND, THEREFORE THE ADDITION OF RS. 5,60,000/- BY THE AO ON THIS ACCOUNT IS ABSOLUTELY JUSTIFIED. THE ACTION OF THE AO IN MAKING AN ADDITION OF RS. 5,60,000/-ON ACCOUNT OF DIFFEREN CE OF LIVESTOCK VALUE IS THEREFORE, UPHELD. THIS GROUND OF APPEAL IS DISMISSED. 8. AGGRIEVED THE ASSESSEE HAS PREFERRED AN APPEAL B EFORE US AND HAS RAISED THE FOLLOWING GROUNDS :- 1. IN THE FACTS AND CIRCUMSTANCES OF THE CASE AND I N LAW THE LEARNED CIT (APPEALS) ERRED IN CONFIRMING THE ADDIT ION MADE BY AO OF RS.5,60,000/- BY APPLYING THE PROVISIONS OF S ECTION 69 OF INCOME TAX ACT, 1961 BEING THE COST OF 28 BUFFALOES ON THE GROUND THAT THERE IS ALLEGED DISCREPANCY IN THE STO CK AT JARI MARI STABLE AT ANDHERI KURLA ROAD MUMBAI. 2. REASONS GIVEN BY CIT (APPEALS) FOR CONFIRMING TH E ADDITION MADE BY A.O. OF RS.5,60,000/- BY APPLYING THE PROVISIONS OF SECTION 69 OF INCOME TAX ACT, 1961 BE ING THE COST ITA NO. 5877/M/09 & 5822/M/09 5 OF 28 BUFFALOES ON THE GROUND THAT THERE IS ALLEGED DISCREPANCY IN THE STOCK AT JARI MARI STABLE AT ANDHERI KURLA R OAD MUMBAI, ARE WRONG INSUFFICIENT AND CONTRARY TO THE FACTS AN D EVIDENCE ON RECORD. 9. WE FIND THAT ON THE DATE OF SURVEY 108 BUFFALOS WAS FOUND IN ITS JARIMARI STABLE AS AGAINST 80 DISCLOSED IN THE BOOK S OF ACCOUNT. HENCE THE MANNER OF MAINTAINING THE BOOKS OF ACCOUNT BY NOT R ECORDING THE INCREASE IN THE LIVESTOCK DUE TO BIRTH OF BUFFALOS AND DECREASE DUE TO DEATH IS INCORRECT IN AS MUCH AS IT DOES NOT REFLECT THE CORRECT NUMBER O F LIVESTOCK. THE UNDERSTATEMENT OF LIVESTOCK TO THE EXTENT OF 28 BUF FALOS HAS BEEN OBSERVED BY THE AO AND HENCE THE ADDITION OF RS. 5,60,000/- MADE BY THE AO ON THIS ACCOUNT AND CONFIRMED BY THE LD. CIT(A) IS JUSTIFIE D AND HENCE WE CONFIRM THE ORDER OF LD. CIT(A) ON THIS ISSUE. 10. THE THIRD GROUND IS WITH RESPECT TO ADDITION MA DE BY THE AO OF RS. 50,98,320/- ON ACCOUNT OF ALLEGED SUPPRESSION OF YI ELD OF MILK OF 4 LITERS PER DAY PER ANIMAL. 11. BEFORE THE LD. CIT(A) THE ASSESSEE OBJECTED TO THE ADDITION ON ACCOUNT OF EXCESS SALE OF MILK OUTSIDE BOOKS OF ACCOUNT FRO M JARIMARI IN ANDHERI KURLA ROAD OF RS. 50,98,320/-. THE AO HELD THAT THERE IS A SUPPRESSION OF MILK YIELD AT 4 LITRES PER ANIMAL AND UNACCOUNTED SALE OF EXCESS MILK HAS BEEN ESTABLISHED. THE AO HAS TAKEN THE TOTAL LIVESTOCK OF BUFFALOS YIELDING MILK AT 108 AT JARIMARI AND 86 AT VASAI TOTALING TO 194. T HE SURVEY PARTY HAD TAKEN THE YIELD TO BE 10 LITRES PER ANIMAL PER DAY AS AGA INST 6 LITRES PER DAY PER ANIMAL AS SHOWN BY THE ASSESSEE IN THE BOOKS OF ACC OUNT. THUS THE AO HELD THAT THERE WAS SUPPRESSION OF MILK YIELD AT 4 LITRE S PER ANIMAL PER DAY AND THE SUPPRESSION OF MILK SALE WAS ESTIMATED TO BE RS . 18X4X365X194= RS. 50,98,320/-. 12. THE LD. AR OF THE ASSESSEE SUBMITTED BEFORE THE LD. CIT(A) THAT THE SURVEY PARTIES HAVE WRONGLY COUNTED THE TOTAL LIVES TOCK AT 108, AND WHILE ITA NO. 5877/M/09 & 5822/M/09 6 COUNTING THEY HAVE WRONGLY INCLUDED MILKING AS WELL AS NON MILKING BUFFALOES AND ALSO THE CALVES BORN WITHIN THE AGE GROUP OF 1 TO 4 YEARS. FURTHER THE AR SUBMITTED THAT DURING THE SURVEY, THE ASSESSEE WAS NOT QUESTIONED ABOUT DISCREPANCY IN RESPECT OF MILK SALE OR EXCESS CALVE S. 13. THE LD. CIT(A) AT PARA 8.3 OF HIS ORDER CONSIDE RED ELABORATELY THE FACTS WHICH ARE AS FOLLOWS: I) THAT IN THE COURSE OF SURVEY AT JARIMARI ROAD, ANDH ERI, IT WAS FOUND BY THE TEAM THAT ON THAT DAY EXTRA MILK OF 1, 800 LITRES WERE SOLD AND THE SAME WERE NOT ACCOUNTED FOR. II) THE ASSESSEE HAD MADE DISCLOSURE OF ADDITION INCOM E TO THE EXTENT OF RS. 20,00,000/-. SUCH DECLARATION WAS MA DE ALONG OTHER PARTIES SURVEYED IN THE NEARBY PREMISES AND W HO ARE ENGAGED IN THE SAME TRADE. III) THE ASSESSEE IN A SHORT SPAN OF TIME RETRACTED HIS DECLARATION OF DISCLOSURE OF ADDITIONAL INCOME OF RS. 20,00,000/-. 14. TAKING ALL THE FACTS INTO ACCOUNT, THE LD. CIT( A) HELD AS FOLLOWS: I HAVE CAREFULLY CONSIDERED THE ISSUE. IT ISA FACT T HAT DURING THE COURSE OF SURVEY AT APPELLANTS PREMISES AT JARIMAR I ROAD, ANDHERI, IT WAS FOUND THAT ON THAT DAY EXTRA MILK O F 1,800 LITRES WERE SOLD AND THE SAME WAS NOT ACCOUNTED FOR. THE A PPELLANT HAS GIVEN VARIOUS EXPLANATIONS IN RESPECT OF THE S AME AND IT IS APPARENT THAT DUE TO THIS DISCREPANCY ALONE, THE AP PELLANT HAD TO MAKE A DISCLOSURE OF ADDITIONAL INCOME TO THE EX TENT OF RS.20,00,000/-. SUCH DECLARATION WAS MADE ALONG WIT H OTHER PARTIES SURVEYED IN THE NEARBY PREMISES AND WHO ARE ENGAGED IN THE SAME TRADE. THE DECLARATION MADE BY THE APPE LLANT HAS PROBABLY PERSUADED THE SURVEY PARTY NOT TO GO INTO THE GREATER DETAIL OF EXCESS MILK FOUND AT JARIMARI STABLE. PRO BABLY THE SURVEY PARTY WAS AWARE OF THE FACT THAT THEY WILL FIND IT DIFFICULT TO JUDICIOUSLY ESTABLISH THAT SUCH EXTRA SALE CAN BE EXTRAPOLATED FOR THE ENTIRE YEAR. THEREFORE, RATHER THAN GETTING INTO THE QUESTION OF THE EXTRA MILK BEING UNACCOUNTED STOCK FOR THE DAY ITA NO. 5877/M/09 & 5822/M/09 7 OR FOR MORE THAN A DAY, ETC, A DECLARATION WAS MADE BY THE APPELLANT TO SHOW AN EXTRA INCOME OF RS.20,00,000/- IN HIS RETURN OF INCOME. SUBSEQUENT DENIAL IN A VERY SHORT SPAN OF TIME BY THE APPELLANT, ONLY RAISES THE ISSUE OF EVIDENC E IN THIS REGARD. BUT THE FACT REMAINS THAT SWORN STATEMENT U NDER WHICH THE DECLARATION WAS MADE HAS TO BE CONSIDERED IN TH E LIGHT OF THE FACT THAT BOTH THE SURVEY PARTY AND THE APPELLA NT HAD WEAK EVIDENCE IN THEIR POSSESSION AT THE TIME OF SURVEY, WHICH HAD LED TO A PROPER AND MUTUALLY AGREED ESTIMATE OF ADDITIO NAL INCOME AT THE TIME OF SURVEY. IT IS NOT A CASE WHERE THREA T OR COERCION WAS APPLIED TO EXTRACT THE CONFESSION. THE APPELLAN T WAS WELL AWARE OF THE FACT THAT THE REVENUE WILL FIND IT DIF FICULT TO ESTABLISH THE EXTRA YIELD OF MILK ON A DAY TO DAY B ASIS FOR THE ENTIRE YEAR. HOWEVER, THE CIRCUMSTANCES OF THE EXCE SS MILK FOUND HAS TO BE READ TOGETHER WITH THE DECLARATION MADE BY THE APPELLANT AND THE FACT THAT 108 BUFFALOES WERE FOUN D IN HIS TABLE AS AGAINST 80 SHOWN IN THE BOOKS WHICH HAS IMPLICAT ION IN TERMS OF EXTRA YIELD OF MILK. UNDER THESE CIRCUMSTANCES, THE DECLARATION MADE BY THE APPELLANT HAD TO BE HONORED BY HIM. 15. FURTHER THE LD. CIT(A) TAKING INTO ACCOUNT THE DECLARATION MADE BY THE ASSESSEE HELD THAT BALANCING FIGURE HAS TO BE TAKEN AS THE INCOME GENERATED BY THE ASSESSEE FROM THE EXCESS YIELD OF MILK NOT A CCOUNTED IN THE BOOKS OF ACCOUNT. THEREFORE HE HELD THAT BESIDES THE ADDITI ON OF RS. 5,60,000/- ON ACCOUNT OF DIFFERENCE OF VALUATION OF LIVESTOCK, A SUM OF RS. 14,40,000/- HAS TO BE TREATED AS THE EXCESS INCOME GENERATED THROUG H THE YIELD OF MILK NOT SHOWN IN THE BOOKS OF ACCOUNT. THEREFORE, HE SUSTA INED THE ADDITION OF RS. 14,40,000/- ON THIS ACCOUNT. 16. WE FIND THAT THE ACTION OF THE LD. CIT(A) IN TH E IMPUGNED ORDER IN THIS REGARD IS IMPEACHABLE. THE LD. CIT(A) HAS CORRECTL Y MADE THE ADDITION OF RS. 14,40,000/- (WHICH IS RS. 20 LAKHS AS PER DECLARAT ION OF THE ASSESSEE) MINUS THE ADDITION ON ACCOUNT OF DIFFERENCE OF VALUATION OF LIVESTOCK I.E. 5,60,000/-. THEREFORE THE LD. CIT(A)S ORDER ON THIS GROUND IS CONFIRMED AND THE ASSESSEES APPEAL ON THIS ISSUE IS DISMISSED. 16.1 IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS DISMISSED. ITA NO. 5877/M/09 & 5822/M/09 8 ITA NO. 5822/MUM/2009 ASSESSMENT YEAR 2004-05 17. THE AO HELD THE TOTAL NUMBER OF LIVESTOCK AT VA SAI STABLE COMES TO 346. THE AO STATED THAT ON PERUSAL OF THE RETURN OF SHRI ISMAIL HAJI KANTHARI, SHRI SALIM ISMAIL KANTHARIA AND AMINA ISMAIL KANTHARI A IT WAS FOUND THAT THE TOTAL STOCK OF BUFFALOES IN THE RETURN WAS ONLY 260 AND HENCE, THERE IS A SHORTFALL OF 86 IN THE LIVESTOCK FOUND AT VASAI AS STATED BY THE SURVEY PARTY. THE AO, THEREFORE, HELD THAT THERE IS AN EXCESS OF 86 BUFFALOES WHOSE VALUE AT RS.20,000/- PER BUFFALOE WORKS OUT TO RS.17,20,000/ - AND THE SAME WAS ADDED UNDER SECTION 69 OF THE I.T. ACT. 18. THE LD. AR SUBMITTED THAT THE ASSESSEE HAD NO S HARE IN LIVESTOCK IN THE STABLE AT VASAI AND THE VASAI STABLE BELONGS TO HIS FAMILY MEMBERS AND THAT THE ASSESSEE IS ASSESSED TO INCOME TAX SEPARAT ELY AND ALL OTHER FAMILY MEMBERS ARE ALSO ASSESSED TO INCOME TAX IN THEIR RE SPECTIVE CAPACITIES. THE ASSESSEES BROTHER SUBMITTED AN AFFIDAVIT DATED 12. 02.2007 TO THE AO CONFIRMING THAT THE ASSESSEE HAS NEITHER SHARE OF L IVESTOCK NOR ANY SHARE IN THE STABLE SITUATED AT VASAI BELONGING TO HIS MOTHE R, BROTHER AND FATHER. THE LD. AR ALSO STATED THAT BEFORE THE WARD INSPECTOR M R. P. N. BHATIA WHO HAS VISITED THE STABLE SITUATED AT VASAI ON 07.09.2006 IT WAS ALSO POINTED OUT THAT THE ASSESSEE HAD NO SHARE IN THE VASAI STABLE. THE LD. AR ALSO POINTED OUT THAT DURING THE COURSE OF SURVEY, STATEMENT OF MR. SADIQ KANTHARIA WAS ALSO RECORDED WHEREIN NO SUCH QUESTION OF HAVING ANY SHA RE IN VASAI STABLE WAS PUT FORTH NOR ANY DOCUMENTS WAS FOUND IN THE PREMIS ES SUGGESTING THE SAME. 19. THE LD.CIT(A) HELD THAT THE AO HAS COMPLETELY I GNORED THE OBJECTIONS RAISED BY THE ASSESSEE THAT NOTHING AT VASAI BELONG S TO HIM AND NEITHER AT THE TIME OF THE SURVEY PROCEEDINGS NOR LATER ANY OF THE CONCERNED PARTIES HAVE MADE ANY SUGGESTION TO THE FACT THAT ANY PART OF TH E VASAI STABLE BELONGS TO THE ASSESSEE. HENCE, THE LD. CIT(A) DELETED THE ADD ITION OF RS.17,20,000/- IN ITA NO. 5877/M/09 & 5822/M/09 9 THE HANDS OF THE ASSESSEE HOLDING IT AS AN IMAGINAR Y EXCESSIVE ON THE PART OF AO TO HAVE MADE THE ADDITION. 20. AGGRIEVED THE DEPARTMENT IS AN APPEAL BEFORE US AND HAS RAISED THE FOLLOWING GROUND :- 1.(I) ON THE FACTS AND CIRCUMSTANCES OF THE CAES A ND IN LAW, THE LEARNED CIT(A) HAS ERRED IN DELETING THE ADDITI ON OF RS.17,20,000/- BEING EXCESS UNACCOUNTED STOCK OF 86 BUFFALOES FOUND DURING THE COURSE OF SURVEY PROCEEDINGS AT VA SAI STABLE. (II) THE LEARNED CIT(A) HAS NOT APPRECIATED THE EVI DENCE THAT THIS EXCESS UNACCOUNTED STOCK OF 86 BUFFALOES AT VASAI STABLE BELONGS TO ASSESSEE AND HIS FAMILY AND THAT NONE OF THE FAMILY MEMBERS HAVE CLAIMED IT TO BE THEIR EXCESS S TOCK IN THEIR RETURNS OF INCOME WHICH OBVIOUSLY PROVES THAT THE E XCESS LIVESTOCK IS OWNED BY ASSESSEE AS PART OF FAMILY WE ALTH AND 86 BUFFALOES CORRESPONDS TO ASSESSEES 1/4 TH SHARE OUT OF TOTAL 346 BUFFALOES. (III) THE LEARNED CIT(A) HAS NOT APPRECIATED THE FA CT THAT DURING THE COURSE OF SURVEY PROCEEDINGS, THE ASSESS EES BROTHER/FATHER HAS GIVEN A STATEMENT THAT THE EXCES S BELONGS TO THE ASSESSEE. (IV) THE LEARNED CIT(A) HAS IGNORED THE FACT THAT T HE ONUS LIES ON THE ASSESSEE TO PRVE THAT THE UNACCOUNTED S TOCK OF 86 BUFFALOES IS NOT PART OF HIS SHARE OF FAMILY WEALTH AND AS TO WHOM IT ACTUALLY BELONGS TO. 21. THE ASSESSEE BY AN AFFIDAVIT STATED AS FOLLOWS :- THE ASSESSEE HAS NO RIGHT, TITLE AND INTEREST IN T HE STABLE AT VASAI NOR HE HAS ANY SHARE IN THE BUFFALOES KEPT AT VASAI STABLE. ALL THE MILK COLLECTED AT VASAI STABLE OWNED BY THE APPELLANTS BROTHER, FATHER AND MOTHER IS SENT TO MUMBAI FOR DI STRIBUTION AND THE SALE PROCEEDS IN THE FORM CHEQUE/CASH OUT O F THE SAID MILK COLLECTED AT VASAI STABLE IS ACCOUNTED IN THE SEPARATE BOOKS OF ACCOUNT MAINTAINED BY THREE OF THEM. ITA NO. 5877/M/09 & 5822/M/09 10 SADIQ HAJI ISMAIL KANTHARIA I.E. THE APPELLANT HAS O NE STABLE AT JARI-MARI ROAD, ANDHERI KURLA ROAD ONLY AND HE DOES NOT OWN ANY BUFFALOES IN VASAI STABLE. HE HAS NEVER SAID THAT THE APPELLANT HAS ANY SHARE IN VASAI STABLE IN HIS STATEMENT AND ALL THE FAMILY MEMBERS ARE DOING BUSINESS SEPARATELY WHILE THE APPELLANT IS CARRYING ON HIS BUSINESS FROM JARI-MARI, ANDHERI-KURLA ROAD, AND TH E SAID SALIM ALONG WITH HIS FATHER AND MOTHER ARE CARRYING ON TH EIR BUSINESS FROM VASAI STABLE. 22. FURTHER DURING THE COURSE OF SURVEY STATEMENT O F MR. SADIQ KANTHARIA WAS RECORDED WHEREIN NO SUCH QUESTION OF HAVING ANY SHARE IN VASAI STABLE WAS PUT FORTH, NOR ANY DOCUMENTS WAS FOUND IN THE P REMISES SUGGESTING THE SAME. SINCE NO MATERIAL HAS BEEN BROUGHT FORWARD BY THE DEPARTMENT TO ESTABLISH THAT MR. SADIQ KANTHARIA HAD SHARE IN THE IR LIVESTOCK STABLE SITUATED AT VASAI AND THE ASSESSEE HAS STATED THAT NOTHING A T VASAI STABLE BELONGS TO HIM. THE ESTIMATE EXCESS STOCK OF BUFFALOES AT VASA I STABLE IN THE HANDS OF THE ASSESSEE IS TO BE DELETED AND THE ORDER OF THE LD. CIT(A) ON THIS ISSUE IS CONFIRMED. 23. THE SECOND GROUND OF APPEAL RAISED BY THE REVEN UE IS AS FOLLOWS :- 2. (I) ON THE FACTS AND IN THE CIRCUMSTANCES OF TH E CASE, THE LEARNED CIT(A) HAS ERRED IN DELETING THE ADDITION O F RS.1,18,26,000/- BEING SUPPRESSION OF MILK SALE ON ACCOUNT OF EXCESS UNACCOUNTED STOCK OF BUFFALOES AT VASAI STAB LE. (II) THE LEARNED CIT(A) HAS NOT APPRECIATED THE FAC T THAT THE UNACCOUNTED STOCK OF BUFFALOES FOUND DURING THE SUR VEY HAS NOT BEEN CLAIMED BY ANY OF THE FAMILY MEMBERS OF THE AS SESSEE WHO OWN THE STABLE ALONGWITH THE ASSESSEE, THUS LEA DING TO THE CONCLUSION THAT THE EXCESS MILK SALES ON THIS ACCOU NT NEEDS TO BE TAXED IN THE HANDS OF THE ASSESSEE AS THE UNACCO UNTED STOCK OF BUFFALOES OBVIOUSLY BELONG TO THE ASSESSEE AS PA RT OF FAMILY WEALTH. 24. THE AO HAS STATED THAT EXCESS SALE OF 1800 LTS WAS DETECTED DURING THE COURSE OF SURVEY PROCEEDINGS AT VASAI STABLE. ON TH IS BASIS, THE AO HAS ITA NO. 5877/M/09 & 5822/M/09 11 ESTIMATED THE CONCEALED INCOME OF 1800 LTRS AT THE COST OF RS.18/- PER LTR FOR THE ENTIRE YEAR WHICH COMES TO RS.1,18,26,000/-. SI NCE IN PARA NO.22 (SUPRA) IT HAS BEEN HELD THAT THE ASSESSEE HAS NO SHARE IN THE STABLE AT VASAI, CONSEQUENTLY THE ASSESSEE CANNOT BE HAVING ANY INCO ME OUT OF THE MILK PRODUCE FROM THE STABLE AT VASAI. DUE TO THE LACK O F ASSESSEES INTEREST IN THE STABLE AT VASAI, THERE CANNOT BE ANY SUPPRESSION OF SALE ATTRIBUTABLE TO THE ASSESSEE IN RESPECT OF THE MILK OF THE VASAI STABLE . HENCE THIS GROUND RAISED BY THE REVENUE IS DISMISSED. 25. THE THIRD GROUND OF APPEAL IS ALREADY BEING DEA LT BY US IN ITA NO. 5877/MUM/2009 IN ASSESSEES APPEAL AT PARA 9 AND TH E SAME SHALL BE FOLLOWED IN THIS APPEAL. 26. IN THE RESULT, THE REVENUES APPEAL IS DISMISSED . ORDER PRONOUNCED ON THIS 30 TH DAY OF AUGUST, 2011 SD/- SD/- ( R. S. SYAL ) (ASHA VIJAYARAGHAVAN) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI, DATED 30 TH AUGUST, 2011 RJ COPY TO : 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT-CONCERNED 4. THE CIT(A)-CONCERNED 5. THE DR BENCH TRUE COPY BY ORDER ASSTT. REGISTRAR, I.T.A.T, MUMBAI ITA NO. 5877/M/09 & 5822/M/09 12 DATE INITIALS 1. DRAFT DICTATED ON: 24.8.2011 SR. PS/PS 2. DRAFT PLACED BEFORE AUTHOR: 25.08.2011 SR. PS/PS 3. DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER: JM/AM 4. DRAFT DISCUSSED/APPROVED BY SECOND MEMBER: JM/AM 5. APPROVED DRAFT COMES TO THE SR. PS/PS: SR. PS/PS 6. ORDER PRONOUNCED ON: SR. PS/PS 7. FILE SENT TO THE BENCH CLERK: 8. DATE ON WHICH FILE GOES TO THE HEAD CLERK: SR. PS/PS 9. DATE ON WHICH FILE GOES TO AR 10. DATE OF DISPATCH OF ORDER: