ACIT, New Delhi V. Shri Malook Nagar, New Delhi

ITA 5830/DEL/2014

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 2972 (ITAT-DELHI)
• Duration Of Justice: 3 year(s) 4 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-03-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 22-06-2017
• Assessment Year: 2005-2006
• Appeal Filed On: 30-10-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: AKSHAT JAIN CAS; SSH RAJAT JAIN
• Assessee Lawyers: APARNA KARAN
• Keywords: Unexplained cash credit; Capital asset; Income from undisclosed sources; Search and seizure; Opportunity of being heard; Principle of natural justice; Additional evidence; Corroborative evidences; Deemed dividend; Benefit of exemption
• Section: 143(3); 142(1); 153A; 132; 144; 15

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: A , NEW DELHI BEFORE SH. AMIT SHUKLA, JUDICIAL MEMBER AND SH. O.P. KANT, ACCOUNTANT MEMBER ITA NO.5519/DEL/2014 ASSESSMENT YEAR: 2005 - 06 WITH ITA NO. 5520/DEL/2014 ASSESSMENT YEAR: 2006 - 07 WITH ITA NO.5521/DEL/2014 ASSESSMENT YEAR: 2007 - 08 WITH ITA NO.5522/DEL/2014 ASSESSMENT YEAR: 2008 - 09 WITH ITA NO.5523/DEL/2014 ASSESSMENT YEAR: 2009 - 10 WITH ITA NO.5524/DEL/2014 ASSESSMENT YEAR: 2010 - 11 WITH ITA NO.5525/DEL/2014 ASSESSMENT YEAR: 2011 - 12 SH. MALOOK NAGAR, D - 3/10, PASCHIMI MARG, VASANT VIHAR, NEW DELHI VS. DCIT, CENTRAL CIRCLE - 21, NEW DELHI PAN :ADKPN2266L (APPELLANT) (RESPONDENT) AND ITA NO.5830/DEL/2014 ASSESSMENT YEAR: 2005 - 06 W ITH ITA NO.5831/DEL/2014 ASSESSMENT YEAR: 2006 - 07 2 WITH ITA NO.5832/DEL/2014 ASSESSMENT YEAR: 2007 - 08 WITH ITA NO. 5833/DEL/2014 ASSESSMENT YEAR: 2008 - 09 WITH ITA NO. 5834/DEL/2014 ASSESSMENT YEAR: 2009 - 10 WITH ITA NO. 5835/DEL/2014 ASSESSMENT YEAR : 2010 - 11 WITH ITA NO.5836/DEL/2014 ASSESSMENT YEAR: 2011 - 12 ACIT, CENTRAL CIRCLE - 21, NEW DELHI VS. SH. MALOOK NAGAR, D - 3/10, VASANT VIHAR, NEW DELHI PAN :ADKPN2266L (APPELLANT) (RESPONDENT) ASSESSEE BY S/SH. RAJAT JAIN & AKSHAT JAIN, CAS RESPONDENT BY SMT. APARNA KARAN, CIT(DR) DATE OF HEARING 08.02.2018 DATE OF PRONOUNCEMENT 1 4 . 0 3 . 2 0 1 8 ORDER PER B E N C H : THESE CROSS APPEALS OF THE ASSESSEE AND THE R EVENUE HAVE BEEN PREFERRED AGAINST SEPARATE ORDERS PASSED BY THE LD. COMMISSIONER OF INCOME - TAX (APPEALS) - XXV, NEW DELHI FOR ASSESSMENT YEAR 2005 - 06 TO ASSESSMENT YEAR 2011 - 12. IN ALL THESE APPEALS , COMMON ISSUES ARE INVOLVED IN SAME SET OF FACTS 3 AND CIRCUMSTANCES, AND TH EREFORE, THESE APPEALS WERE HEARD TOGETHER AND DISPOSED OFF BY WAY OF THIS CONSOLIDATED ORDER FOR CONVENIENCE. 2. IN ASSESSMENT YEARS 2005 - 06 TO 2010 - 11, ASSESSMENT PROCEEDINGS HAVE BEEN COMPLETED UNDER SECTION 153A OF THE INCOME - TAX ACT , 1961 (IN SHORT THE ACT ) WHEREAS IN ASSESSMENT YEAR 2011 - 12, THE ASSESSMENT HAS BEEN COMPLETED UNDER SECTION 143(3) OF THE ACT . 3. BRIEFLY STATED FACTS OF THE CASE ARE THA T THE ASSESSEE IS AN INDIVIDUAL AND A SEARCH AND SEIZURE OPERATION UNDER SECTION 132(1) OF THE INCOME - TAX ACT, 1961 (IN SHORT THE ACT ) WAS CARRIED OUT ON 17/09/2010 AT THE PREMISES OF THE ASSESSEE A LONGWITH OTHER CASES OF NAGAR DAIRY G ROU P AND SANYA G ROUP OF CASES. CONSEQUENT TO SEARCH ACTION, NOTICES WERE ISSUED UNDER SECTION 153A OF THE ACT IN RESPECT OF ASSESSMENT YEAR 2005 - 06 TO 2010 - 11 AND UNDER SECTION 143(2) THE ACT IN RESPECT OF ASSESSMENT YEAR 2011 - 12. IN ALL THE ASSESSME NTS COMPLETED , MAINLY ADDITIONS HAVE BEEN MADE ON THREE IS SUES: 1 . A GRICULTURE INCOME SHOWN BY THE ASSESSEE HELD AS UNDISCLOSED INCOME. 2 . CREDIT ENTRIES IN BANK ACCOUNTS HELD AS UNDISCLOSED INCOME . 3 . D EEMED DIVIDEND UNDER SECTION 2(22)(E) OF THE ACT . 3.1 B EFORE THE LD. CIT - ( A ) , THE ASSESSEE SUBMITTED THAT ADDITIONS MADE ARE OUTSIDE THE AMBIT AND SCOPE OF SECTION 15 3A OF THE ACT 4 AND ALSO CHALLENGED THE ADDITION ON MERIT. THE LD. CIT - ( A ) THOUGH UPHELD ADDITIONS ON LEGAL GROUND , HOWEVER ON MERIT, HE PARTLY DELETED THE ADDITIONS RELATED TO CREDIT IN BANK ACCOUNT AND DEEMED DIVIDEND, WHEREAS UPHELD THE ADDITION RELATED TO AGRICULTURE INCOME. ITA NO S . 5519, 5520 & 5521/DEL/2014 A ND ITA NO S . 5830, 5831 & 5832/DEL/2014 4. BEFORE US, I N ASSESSMENT YE ARS 2005 - 06 TO 2007 - 08, THE LD. COUNSEL OF THE ASSESSEE, FIRST CHALLENGED THE VALIDITY OF THE ADDITION MADE RELYING ON THE DECISION OF THE HON BLE DELHI HIGH COURT IN THE CASE OF CIT VS. KABUL CHAWLA (2015) (380 ITR 573) AND ARGUED THAT IN ABSENCE OF ANY I NCRIMINATING MATERIAL NO ADDITION COULD HAVE BEEN MADE IN COMPLETED ASSESSMENTS. ACCORDINGLY, WE ARE TAKING FIRST A PPEALS OF THE ASSESSEE AND THE R EVENUE FOR ASSESSMENT YEARS 2005 - 06 TO 2007 - 08 FOR ADJUDICATION. 5. THE GROUNDS RAISED BY THE ASSESSEE IN ITA NO. 5519/DEL/2014 FOR ASSESSMENT YEAR 2005 - 06, ITA NO. 5520/DEL/2014 FOR ASSESSME NT YEAR 2006 - 07 AND ITA NO. 5521 /DEL/2014 FOR ASSESSMENT YEAR 2007 - 08 BEING IDENTICAL EXCEPT CHANGE OF AMOUNT, WE ARE REPRODUCING ONLY GROUNDS OF APPEAL IN ITA NO. 5519/DEL/2 014 AS UNDER: 1. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE APPELLANT S CASE, THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) ERRED BOTH IN FACT AND IN LAW IN CONFIRMING THE ADDITION OF RS 7,90,000/ - MADE BY AO BY TREATING THE AGRICULTURAL INCOME EARNED BY THE APPELLANT AS UNEXPLAINED INCOME ONLY ON THE 5 BASIS THAT NO PROOF OF HAVING AGRICULTURAL INCOME WAS IN POSSESSION OF THE APPELLANT WITHOUT APPRECIATING THE FACT THAT THE APPELLANT HAS ALREADY CONSIDERED THE SAID AGRICULTURAL INCOME IN THE RETUR N OF INCOME. 2. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE APPELLANT S CASE, THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) ERRED BOTH IN FACT AND IN LAW IN CONFIRMING THE ADDITION OF RS 7,90,000/ - MADE BY AO BY TREATING THE AGRICULTURAL INCOME E ARNED BY THE APPELLANT AS UNEXPLAINED INCOME THOUGH THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) HIMSELF ACKNOWLEDGED THE FACT IN THE IMPUGNED ORDER THAT THE APPELLANT HAS SALES RECEIPTS OF AGRICULTURAL GOODS SOLD, PROOF OF OWNERSHIP OF AGRICULTURAL LA ND AND EXPENSE INCURRED IN SUPPORT OF AGRICULTURAL INCOME DECLARED IN THE RETURN OF INCOME. 3. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE APPELLANT S CASE, THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) ERRED BOTH IN FACT AND IN LAW IN CONFIRMING THE ADDITION OF RS 7,90,000/ - MADE BY AO BY TREATING THE AGRICULTURAL INCOME EARNED BY THE APPELLANT AS UNEXPLAINED INCOME ONLY ON THE BASIS OF SUSPICION, SURMISES AND CONJECTURES THAT AGRICULTURAL INCOME SHOWN IN THE RETURN OF INCOME IS A CONTRIVANCE DEV ISED BY THE APPELLANT TO PLOUGH BACK UNACCOUNTED INCOME INTO BUSINESS WITHOUT BRINGING IN ANY MATERIAL ON RECORD FOUND DURING THE COURSE OF SEARCH AND SEIZURE OPERATION IN SUPPORT OF HIS ALLEGATION. 4. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE APP ELLANT S CASE, THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) ERRED BOTH IN FACT AND IN LAW IN UPHOLDING THE VALIDITY OF ASSUMPTION OF JURISDICTION BY THE AO TO ASSESS THE CASE OF THE APPELLANT UNDER SECTION 144 OF THE INCOME TAX ACT, 1961 WITHOUT ISSUIN G STATUTORY NOTICE UNDER SECTION 144 OF THE INCOME TAX ACT, 1961. 5. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE APPELLANT S CASE, THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) ERRED BOTH IN FACT AND IN LAW IN UPHOLDING THE VALIDITY OF ASSUMPTION OF JURISDICTION BY THE AO TO ASSESS THE CASE OF 6 THE APPELLANT UNDER SECTION 144 OF THE INCOME TAX ACT, 1961 EVEN THOUGH THE AO HAS NOT MENTIONED THE RELEVANT NOTE WHICH INFORMS AN ASSESSEE THAT FAILURE ON THE PART AN ASSESSEE TO COMPLY WITH THE TERMS OF N OTICE 142(1) WILL ENTAIL EX - PARTE ASSESSMENT IN THE NOTICE UNDER SECTION 142(1) OF THE INCOME TAX ACT, 1961 ISSUED BY THE AO. 6. SIMILARLY, G ROUNDS RAISED BY THE R EVENUE IN ITA NO. 5830/DEL/2014 FOR ASSESSMENT YEAR 2005 - 06; ITA NO. 5831/DEL/2014 FOR ASSE SSMENT YEAR 2006 - 07 AND ITA NO. 5832 FOR ASSESSMENT YEAR 2007 - 0 8 ARE IDENTICAL EXCEPT CHANGE OF AMOUNT AND , THEREFORE , WE ARE REPRODUCING ONLY GROUNDS RAISED IN ITA NO. 5830/DEL/2014 AS UNDER: 1. THE COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED IN LAW AND ON FACTS OF THE CASE IN DELETING THE ADDITION OF RS.1,28,00,000/ - OUT OF TOTAL ADDITION OF RS.1,46,63,000/ - MADE ON ACCOUNT OF UNEXPLAINED ENTRIES APPEARING IN BANK ACCOUNT. 2. THE LD. COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED IN LAW AND ON FACTS OF THE CASE IN ADMITTING THE ADDITIONAL/FRESH EVIDENCES UNDER RULE 46A IN RESPECT OF ADDITION OF RS.1,46,63,000/ - 3. (A) THE ORDER OF THE LD. CIT(APPEALS) IS ERRONEOUS AND NOT TENABLE IN LAW AND ON FACT. (B) THE APPELLANT CRAVES LEAVE TO ADD, ALTER OR AMEND ANY/ALL OF THE GROUNDS OF APPEAL BEFORE OR DURING THE COURSE OF THE HEARING OF THE APPEAL. 7 . IN GROUND NO. 3 IN APPEALS OF THE ASSESSEE FOR ASSESSMENT YEARS 2005 - 06 TO ASSESSMENT YEAR 2007 - 08, THE ASSESSEE HAS CHALLENGED THAT NO ADDITION COULD HAV E BEEN MADE WITHOUT BRINGING IN MATERIAL ON RECORD FOUND DURING THE COURSE OF SEARCH AND SEIZURE OPERATION. THE LD. COUNSEL OF THE ASSESSEE SUBMITTED 7 PAPER BOOKS FOR ASSESSMENT YEAR S 2005 - 06 TO 2007 - 08 RESPECT IVELY AND SUPPORTING THE GROUND , HE SUBMITTED T HAT IN RELEVANT ASSESSMENT YEARS, THE RETURNS FILED (PAGE NO S . 4 TO 9 OF PAPER BOOK FOR AY 2005 - 06 ; PAGE NO. 4 TO 9 OF PAPER BOOK FOR AY 2006 - 07 AND PAGE NO . 5 TO 7 OF PAPER BOOK FOR AY 2007 - 08) WERE PROCESSED UNDER SECTION 143 (1) OF THE ACT AND IN EACH CASE , NO NOTICE U/S 143(2) OF THE ACT WAS ISSUED AND EVEN THE LAST DATE OF ISSUE OF NOTICE UNDER SECTION 143(2) OF THE ACT HAD ALREADY EXPIRED PRIOR TO THE DATE OF SEARCH I.E. 17/09/2010 . ACCORDING TO HIM, THE ASSESSMENT ATTAINED FINALITY IN ASSESSMENT YEA RS FROM 2005 - 06 TO 2007 - 08. HE FURTHER SUBMITTED THAT NO ADDITION HAS BEEN MADE ON THE BASIS OF INCRIMINATING MATERIAL FOUND DURING THE COURSE OF SEARCH AND SEIZURE OPERATION. ACCORDING TO HIM, BOTH THE CONDITIONS OF NO INCRIMINATING MATERIAL AND COMPLETED ASSESSMENTS ARE FULFILLED IN THE ASSESSMENT YEARS AND , THUS , RELYING ON THE DECISION OF THE HON BLE DELHI HIGH COURT IN THE CASE OF CIT VS. KABUL CHAWLA ( SUPRA) , NO ADDITION COULD HAVE BEEN MADE BY THE ASSESSING OFFICER IN THE ASSESSMENT YEARS. IN SUPPORT OF HIS CONTENTION THAT ADDITIONS HAVE NOT BEEN MADE ON THE B ASIS OF INCRIMINATING MATERIALS , HE REFERRED TO VARIOUS PARAGRAPHS OF THE ORDER OF THE ASSESSING OFFICER AS WELL AS OF LD. CIT(A). 7 .1 THE LD. CIT ( DR ), ON THE OTHER HAND , SUBMITTED THAT A LIST OF BANK ACCOUNTS HELD BY THE ASSESSEE WAS PREPARED DURING THE COURSE OF SEARCH PRO CEEDING IN THE FORM OF ANNEXURE - A - 3, WHICH IS PART OF THE PANCHNAMA DATED 17.09.2010. ACCORDING TO HER , THE ADDITION IN RESPECT OF CREDIT ENTRIES IN BANK ACCOUNTS, HAS BEEN M ADE ON THE BASIS OF INCRIMINATING MATERIAL IN THE FORM OF BANK 8 ACCOUNT FOUND DURING THE COURSE OF SEARCH. ACCORDING TO HER, AT LEAST THE ADDITION IN RESPECT OF UNEXPLAINED CREDIT IN BANK ACCOUNT, WAS BASED ON INCRIMINATING MATERIAL FOUND DURING THE COURSE OF SEARCH AND THUS, TO THAT EXTENT RATIO OF THE HON BLE DELHI HIGH COURT IN THE CASE OF KABUL CHAWLA (SUPRA) WOULD NOT APPLY. 7 .2 WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE RELEVANT MATERIAL ON RECORD. THE LD. COUNSEL OF THE ASSESSEE HAS RELIED ON THE DECISION OF THE HON BLE DELHI HIGH COURT IN THE CASE OF KABUL CHAWLA (SUPRA) AND SUBMITTED THAT NO ADDITION COULD HAVE BEEN MADE IN THE ASSESSMENT YEAR S 2005 - 06 TO 2007 - 08 IN VIEW OF NO INCRIMINATING MATERIAL FOUND DURING THE COURSE OF SEARCH AND ASSESSMENTS ALREADY ATTAINED FINALITY, BEFORE TAKING OF SEARCH ACTION DATED 17/09/2010. THE RELEVANT FINDING OF THE HON BLE DELHI HIGH COURT IN THE CASE OF KABUL CHAWLA (SUPRA) IS REPRODUCED AS UNDER: SUMMARY OF THE LEGAL POSIT ION 37. ON A CONSPECTUS OF SECTION 153A(1) OF THE ACT, READ WITH THE PROVISOS THERETO, AND IN THE LIGHT OF THE LAW EXPLAINED IN THE AFOREMENTIONED DECISIONS, THE LEGAL POSITION THAT EMERGES IS AS UNDER: I. ONCE A SEARCH TAKES PLACE UNDER SECTION 132 OF TH E ACT, NOTICE UNDER SECTION 153 A (1) WILL HAVE TO BE MANDATORILY ISSUED TO THE PERSON SEARCHED REQUIRING HIM TO FILE RETURNS FOR SIX AYS IMMEDIATELY PRECEDING THE PREVIOUS YEAR RELEVANT TO THE AY IN WHICH THE SEARCH TAKES PLACE. II. ASSESSMENTS AND REASSE SSMENTS PENDING ON THE DATE OF THE SEARCH SHALL ABATE. THE TOTAL INCOME FOR SUCH AYS WILL HAVE TO BE COMPUTED BY THE AOS AS A FRESH EXERCISE. III. THE AO WILL EXERCISE NORMAL ASSESSMENT POWERS IN RESPECT OF THE SIX YEARS PREVIOUS TO THE RELEVANT AY IN WHIC H THE SEARCH TAKES PLACE. THE AO HAS THE POWER TO ASSESS AND REASSESS THE 'TOTAL INCOME' OF THE AFOREMENTIONED SIX YEARS IN SEPARATE ASSESSMENT ORDERS FOR EACH OF THE 9 SIX YEARS. IN OTHER WORDS THERE WILL BE ONLY ONE ASSESSMENT ORDER IN RESPECT OF EACH OF T HE SIX AYS IN WHICH BOTH THE DISCLOSED AND THE UNDISCLOSED INCOME WOULD BE BROUGHT TO TAX . IV. ALTHOUGH SECTION 153 A DOES NOT SAY THAT ADDITIONS SHOULD BE STRICTLY MADE ON THE BASIS OF EVIDENCE FOUND IN THE COURSE OF THE SEARCH, OR OTHER POST - SEARCH MAT ERIAL OR INFORMATION AVAILABLE WITH THE AO WHICH CAN BE RELATED TO THE EVIDENCE FOUND, IT DOES NOT MEAN THAT THE ASSESSMENT CAN BE ARBITRARY OR MADE WITHOUT ANY RELEVANCE OR NEXUS WITH THE SEIZED MATERIAL. OBVIOUSLY AN ASSESSMENT HAS TO BE MADE UNDER THIS SECTION ONLY ON THE BASIS OF SEIZED MATERIAL. V. IN ABSENCE OF ANY INCRIMINATING MATERIAL, THE COMPLETED ASSESSMENT CAN BE REITERATED AND THE ABATED ASSESSMENT OR REASSESSMENT CAN BE MADE. THE WORD 'ASSESS' IN SECTION 153 A IS RELATABLE TO ABATED PROCEED INGS (I.E. THOSE PENDING ON THE DATE OF SEARCH) AND THE WORD 'REASSESS' TO COMPLETED ASSESSMENT PROCEEDINGS. VI. INSOFAR AS PENDING ASSESSMENTS ARE CONCERNED, THE JURISDICTION TO MAKE THE ORIGINAL ASSESSMENT AND THE ASSESSMENT UNDER SECTION 153A MERGES INT O ONE. ONLY ONE ASSESSMENT SHALL BE MADE SEPARATELY FOR EACH AY ON THE BASIS OF THE FINDINGS OF THE SEARCH AND ANY OTHER MATERIAL EXISTING OR BROUGHT ON THE RECORD OF THE AO. VII. COMPLETED ASSESSMENTS CAN BE INTERFERED WITH BY THE AO WHILE MAKING THE ASSE SSMENT UNDER SECTION 153 A ONLY ON THE BASIS OF SOME INCRIMINATING MATERIAL UNEARTHED DURING THE COURSE OF SEARCH OR REQUISITION OF DOCUMENTS OR UNDISCLOSED INCOME OR PROPERTY DISCOVERED IN THE COURSE OF SEARCH WHICH WERE NOT PRODUCED OR NOT ALREADY DISCLO SED OR MADE KNOWN IN THE COURSE OF ORIGINAL ASSESSMENT. CONCLUSION 38. THE PRESENT APPEALS CONCERN AYS, 2002 - 03, 2005 - 06 AND 2006 - 07.ON THE DATE OF THE SEARCH THE SAID ASSESSMENTS ALREADY STOOD COMPLETED. SINCE NO INCRIMINATING MATERIAL WAS UNEARTHED DURING THE SEARCH, NO ADDITIONS COULD HAVE BEEN MADE TO THE INCOME ALREADY ASSE SSED. 7 .3 THUS , WE FIND THAT IN PARA - 37(VII) , THE HON BLE HIGH COURT HAS HELD THAT , WHEREVER THE ASSESSMENTS HAVE ATTAINED FINALITY, THE ASSESSING OFFICER CAN MAKE ADDITION ONLY ON THE BASIS OF SOME INCRIMINATING MATERIAL UNEARTHED DURING THE COURSE OF SEARCH. 7 .4 AS FAR AS CONDITION OF ASSESSMENTS ATTAINED FINALITY PRIOR TO THE DATE OF SEARCH IS CONCERNED, WE FIND FOR ASSESSMENT YEAR 2005 - 06 TO ASSESSMENT YEAR 2007 - 08 , ORIGINALLY NO ASSESSMENT UNDER SECTION 143(3) O F THE ACT HAVE BEEN CARRIED OUT. FUR THER, AS 10 ON THE DATE OF SEARCH THE LIMITATION FOR SELECTING THE CASE UNDER SCRUTINY THROUGH ISSUE OF NOTICE 1 43 (2) OF THE ACT ALREADY EXPIRED. THUS, THE ASSESSMENTS UNDER SECTION 143(1) OF THE ACT ATTAINED FINALITY. THE LD. COUNSEL HAS REFERRED VARIOUS PAG ES OF THE PAPER BOOK TO SUBSTANTIATE THE DATE OF RETURN FILED FOR ASSESSMENT YEAR 20 05 - 06 TO 2007 - 08. WE NOTE THAT , IN THIS CASE SEARCH ACTION UNDER SECTION 132 OF THE ACT WAS CARRIED OUT ON 17/09/2010 AND DATE OF FILING OF RETURN AND LAST DATE FOR ISSUE OF NOTICE UNDER SECTION 143(2) OF THE ACT IN RESPECT OF ASSESSMENT YEAR 2005 - 06 TO ASSESSMENT YEAR 2007 - 08 AS SUBMITTED BY THE ASSESSEE ARE REPRODUCED AS UNDER: ASSESSMENT Y EAR 2005 - 06 2006 - 07 2007 - 08 DATE OF FILING OF RETURN OF INCOME 31/03/2006 23/03/2007 31/03/2008 LAST DATE OF INTIMATION UNDER SECTION 143(1) 31/03/2007 31/03/2008 31/03/2009 LAST DATE OF NOTICE UNDER SECTION 143(2) 30/09/2006 30/09/2007 30/09/2008 7 .5 THUS , IN ALL THE THREE ASSESSMENT YEARS I.E. 2005 - 06 TO 2007 - 08, THE DATE FOR ISSUING NOTICE UNDER SECTION 143(2) OF THE ACT ALREADY STANDS EXPIRED AND NO NOTICE UNDER SECTION 143(2) OF THE ACT WAS ISSUED PRIOR TO THE DATE OF SEARCH, THUS, THE ASSESSMENT UNDER SECTION 143(1) OF THE ACT ATTAINED FINALITY AND , THEREFORE , ALL THE THREE ASSESSMENT YEARS ARE TREATED AS COMPLETED ASSESSMENTS. 7 .6 ON THE ISSUE OF THE AVAILABILITY OF INCRIMINATING MATERIAL IN THE ASSESSMENT YEARS IN QUESTION , WE HAVE EXAMINED THE 11 CONTENTION OF LD. CIT ( DR ) . THE LEARNED CIT ( DR ) HAS FILED COPY OF PANCHNAMA CONTAINING ANNEXURE A - 3 , WHICH IS HAVING LIST OF FOLLOWING TWO BANK ACCOUNTS: 1 . HDFC, VASANT VIHAR BANK, NEW DELHI, A/C NO. 00111000123248 IN THE NAME OF SH. MALOOK NAGAR. 2. HDFC VASANT VIHAR BANK, NEW DELHI, A/C NO. 00111000120311 IN THE NAME OF SMT. SUDHA NAGAR 7 .7 THE ISSUE IN DISPUTE HERE IS WHETHER THE DISCLOSURE OF THE BANK ACCOUNT IN ITSELF IS A N INCRIMINATING MATERIAL. THE LEARNED COUNSEL OF THE ASSESSEE SUBMITTED THA T THE BANK ACCOUNTS ARE DULY DISCLOSED IN THE RETURN OF INCOME AND BOOKS OF ACCOUNTS OF THE ASSESSEE AND ENTRIES ARE DULY RECORDED IN REGULAR BOOKS OF ACCOUNTS. IN OUR OPINION , MAKING A LIST OF BANK ACCOUNTS MAINTAINED BY THE ASSESSEE, DURING THE COURSE OF SEARCH PROCEEDI NG, CANNOT ITSELF MAKE THE ENTRIES IN BANK ACCOUNTS AS INCRIMINATING. DURING THE HEARING, T HE BENCH ASKED THE LD. CIT( DR ) AS WHETHER, IN THE STATEMENT UNDER SECTION 132(4) OF THE ACT RECORDED DURING SEARCH PROCEEDING, ANY QUESTION WAS ASKED TO THE ASSESSEE RAISING DOUBTS ON THE CREDIT IN BANK ACCOUNT, HOWEVER, SHE FAILED TO BRING ANY EVIDENCE TO ESTABLISH THAT THE BANK ACCOUNTS FOUND WERE INCRIMINATING DOCUMENT. WITH REGARD TO THE OTHER TWO ADDITIONS RELATED TO AGRICULTURE INCOME AND DIVIDEN D INCOME ALSO , S HE COULD NOT POINT OUT ANY INCRIMINATING MATERIAL FOUND OR SEIZED DURING THE COURSE OF SEARCH FROM THE PREMISES OF THE ASSESSEE. 7 .8 IN VIEW OF THE ABOVE, WE ARE OF THE OPINION THAT IN RESPECT OF ASSESSMENT YEARS 2005 - 06 TO 2007 - 08, THE ASSESSMENTS HAD 12 ALREADY ATTAINED FINALITY BEFORE THE DATE OF SEARCH AND NO INCRIMINATING MATERIAL WAS FOUND OR SEIZED FROM THE PREMISES OF THE ASSESSEE, AND , THUS, RESPECTFULLY FOLLOWING THE FINDING OF THE HON BLE DELHI HIGH COURT IN THE CASE OF KABUL CHAWLA (SUPRA) NO ADDITION COULD HAVE BEEN MADE IN THESE ASSESSMENT YEARS. AS NO A DDITIONS COULD HAVE BEEN MADE, OTHER GROUNDS OF APPEAL CHALLENGING THE MER IT OF THE ADDITION, BOTH IN THE APPEAL OF THE ASSESSEE A S WELL AS IN THE APPEAL OF THE R EVENUE, ARE RENDERED INFRUCTUOUS AND ACCORDINGLY DISMISSED. NO OTHER GROUNDS OF THE APPEALS OF THE ASSESSEE HAVE BEEN ARGUED BY THE LD. COUNSEL OF THE ASSESSEE AND ACCO RDINGLY REMAINING GROUNDS OF APPEAL OF THE ASSESSEE ARE ALSO DISMISSED AS INFRUCTUOUS. 8 . IN THE RESULT, THE APPEALS OF THE ASSESSEE FOR ASSESSMENT YEARS 2005 - 06 TO 2007 - 08 ARE PARTLY ALLOWED, WHEREAS THE APPEAL S OF THE R EVENUE FOR ASSESSMENT YEAR S 20 05 - 0 6 TO 2007 - 08 ARE DISMISSED. ITA NO S . 5522/DEL/2014 & 5833/DEL/2014 9 . NOW WE TAKE UP THE APPEAL OF THE ASSESSEE IN ITA NO. 5 522/DEL/2014 AND APPEAL OF THE R EVENUE IN ITA NO. 5833/DEL/2014, BOTH FOR ASSESSMENT YEAR 2008 - 09. THE GROUNDS RAISED IN ITA NO. 5522/DEL/2014 ARE REPRODUCED AS UNDER: 1 . THAT ON THE FACTS AND I N THE C I RCUMSTANCES OF THE APPELLANT ' S CASE , THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) ERRED BOTH IN FACT AND I N LAW IN CONFIRMING THE ADDITION OF RS 7 , 59 , 528/ - MADE BY AO BY TREATING THE AGRICULTURAL INCOME EARNED BY THE APPELLANT AS UNEXP L AINED INCOME ONLY ON THE BASIS THAT NO PROOF OF HAVING AGRICULTURAL INCOME WAS IN POSSESSION OF THE 13 APPELLANT WITHOUT APPRECIATING THE FACT THAT THE APPELLANT HAS ALREADY CONSIDERED THE SAID AGRICULTURAL INCOME IN THE RETURN OF INCOME . 2 . THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE APPELLANT ' S CASE , THE LEARNED COMMISSIONER OF INCOME TAX ( APPEALS ) ERRED BOTH I N FACT AND IN L AW I N CONF I RM I NG THE ADDITION OF RS 7 , 59 , 528 / - MADE BY AO BY TREATING THE AGRICULTURAL INCOME EARNED BY THE APPE L LANT AS UNEXP L AINED INCOME THOUGH THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS ) HIMSELF ACKNOWLEDGED THE FACT IN THE IMPUGNED ORDER THAT THE APPELLANT HAS SALES RECEIPTS OF AGRICULTURA L GOODS SOLD , PROOF OF OWNERSHIP OF AGRICULTURAL LAND AND EXPENSE INCURRED IN SUPPORT OF AGRICULTURAL INCOME DECLARED IN THE RETURN OF INCOME . 3 . THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE APPELLANT ' S CASE , THE LEARNED COMMISSIONER OF INCOME TAX ( APPEALS) ERRED BOTH IN FACT AND IN LAW IN CONFIRMING THE ADD I T I ON OF RS 7 , 59 , 528/ - MADE BY AO BY TREATING THE AGRICULTURAL INCOME EARNED BY THE APPELLANT AS UNEXPLA I NED I NCOME ONLY ON THE BASIS OF SUSP I CION , SURM I SES AND CONJECTURES THAT AG R ICU L TURA L I NCOM E SHOWN I N THE R ETURN OF INCOME I S A CONTR I VANCE DEV I SED BY THE APPE L LANT TO P L OUGH BACK UNACCOUNTED INCOME I NTO BUSINESS WITHOUT BR I NG I NG I N ANY M ATERIAL ON RECORD FOUND DUR I NG T HE COURSE OF SEARCH AND SE I ZURE OPERAT I ON IN SUPPORT OF HIS A L LEGATION . 4 . THAT ON THE FACTS AND IN THE CI R CUMSTANCES O F TH E APPELLA NT ' S CASE , THE LEA RNED COMMISS I ONER OF INCOME TAX ( APPEA L S ) ERRED BOTH I N FACT AND IN LAW IN CONFI RMING T HE ADDITION OF RS 6 , 33 , 476 / - MADE BY T HE AO I N THE HANDS OF APPEL L ANT AS DEEMED D I V I DEND UNDE R SECTION 2 ( 22 )( E ) O F THE INCOME TAX ACT , 1961 W ITHOU T APPRECIATING THE FAC T THAT NO LOAN O R ADVANCE HAS BEEN G I VEN BY M / S AIMS PROMOTE R S P R IVATE LIMITED TO THE APPELLANT T HROUGH MIS NAGAR DA IR Y P RIVATE LIM I TED OTHER THAN NORMAL BUS I NESS TRANSACTIONS . 14 5 . THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE APPELLANT ' S CASE , THE L EA RNED COMMISSIONER OF INCOME TAX (APPEALS) ERRED BOTH I N FACT AND IN L AW IN UP HOLD IN G THE VALID I TY OF ASSUMPTION OF JURISDICTION BY THE AO TO ASSESS THE CASE OF T H E APPE L LANT UNDER SECTION 144 OF THE INCOME TAX ACT , 1 961 WI T HO U T I SSU IN G S TATUTO RY NOTICE UNDER SECTION 144 OF THE INCOME TAX ACT , 1961 . 6 . THAT ON THE FACTS AND I N THE C I RCUMSTANCES OF THE APPELLANT ' S CASE , T HE L E A RN E D COMMISS I ONER OF INCOME TAX (APPEALS) ERRED BOTH I N FACT AND IN LAW IN UPHO L D ING THE VALIDITY OF ASSUMPTION OF JURISDICTION BY THE AO TO ASSESS THE CASE O F TH E APPELLANT UNDER SECT I ON 144 OF THE - INCOME TAX ACT , 1961 EVEN THOUGH TH E AO H AS NOT MENTIONED THE RELEVANT NOTE WHICH INFORMS AN ASSESSEE THAT F A I L URE O N TH E PART AN ASSESSEE TO COMP L Y WITH THE TERMS OF NOTICE 142 ( 1 ) W I L L E NT A IL EX - PA RT E ASSESSMEN T I N THE N OT I CE UNDER SECTION 1 42 (1) OF THE I NCOME TAX ACT , 1 9 6 1 I SSUED BY THE AO . 7 . THAT THE APPE L LANT CRAVES LEAVE TO ADD , AMEND O R ALTER ANY O F T HE GROUNDS OF APPEA L . 9 .1 THE GROUNDS OF APPEAL RAISED IN ITA NO. 5833/DEL/20144 ARE AS UNDER: 1. THE LD. COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED IN LAW AND ON FACTS OF THE CASE IN DELETING THE ADDITION OF RS.4,17,35,528/ - MADE ON ACCOUNT OF UNEXPLAINED ENTRIES APPEARING IN BANK ACCOUNT. 2. THE LD. COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED IN LAW AND ON FACTS OF THE CASE IN REDUCING THE AMOUNT OF RS.3,23,158/ - OUT OF ADDITION OF RS.9,56,634/ - U/S 2(22)(E), TREATING THE SAME AN AMOUNT OF RE - IMBURSEMENT OF RENT RECEIVABLE BY THE ASSESSEE. 15 3. THE LD. COMMISSIONER OF INCOME TAX (APPEALS) HAS ALSO ERRED IN LAW AND ON FACTS OF THE CASE IN ADMITTING THE ADDITIONAL/FRESH EVIDENCES UNDER RULE 46A. 4. (A) THE ORDER OF THE LD. CIT(APPEALS) IS ERR ONEOUS AND NOT TENABLE IN LAW AND ON FACT. (B) THE APPELLANT CRAVES LEAVE TO ADD, ALTER OR AMEND ANY/ALL OF THE GROUNDS OF THE APPEAL BEFORE OR DURING THE COURSE OF THE HEARING OF THE APPEAL. 10 . THE GROUNDS NO. 1 TO 3 OF THE APPEAL OF THE ASSESSEE RELATES TO ADDITION OF AGRICULTURE IN COME OF RS. 7, 59, 528/ - . 10 .1 THE ASSESSEE IN THE RETURN OF INCOME DEC LARED AGRICULTURE INCOME OF RS. 7,59,528/ - . ACCORDING TO THE ASSESSING OFFICER, THE ASSESSEE DID NOT FILE ANY EVIDENCE S TO SUPPORT THE AGRICULTURE ACTI VITY AND , THEREFORE , HE HELD THE INCOME FROM AGRICULTURE AS UNDISCLOSED INCOME IN THE ASSESSMENT ORDER PASSED UNDER SECTION 153A/144 OF THE ACT. BEFORE THE LD. CIT - ( A ) , THE ASSESSEE SUBMITTED THAT THE ASSESSEE HAD FURNISHED ALL EVIDENCE IN RELATION TO AGRICULTURE INCOME EXCEPT DOCUMENTS IN RESPECT OF OWNERSHIP OF AGRICULTURE LAND, WHICH WERE FILED BEFORE THE LD. CIT - ( A ) AS ADDITIONAL EVIDENCE. THE LD. CIT - ( A ) FORWARDED THOSE ADDITIONAL EVIDENCES TO THE ASSESSING OFFICER FOR HIS COMMENTS. THE LD. CIT - ( A ) AFTER CONSIDERING THE REMAND REPORT OF THE ASSESSING OFFICER AND REJOINDER THERETO OF THE ASSESSEE ADMITTED THE ADDITIONAL EVIDENCES. ACCORDING TO THE LD. CIT - ( A ) FOR CLAIMING BENEFIT OF EXEMPTION OF AGRICULTURE INCOME UNDER SECTION 10 OF THE ACT, THE ASS ESSEE SHOULD HAVE FURNISHED FOLLOWING DOCUMENTS: 16 ( I ) THE PROOF OF USE OF LAND FOR AGRICULTURAL PURPOSES, ( II ) PROOF OF ASSESSMENT TO LAND REVENUE SUBJECT TO A LOCAL RATE ASSESSED AND COLLECTED BY OFFICERS. ( III ) PERFORMANCE OF ANY PROCESS ORDINARILY EMPLOYED BY A CULTIV ATOR OR RECEIVED OF RENT IN KIND. ( IV ) PROOF OF HAVING RENDERED THE PRODUCE RAISED OR RECEIVED BY HIM IN A FIT CONDITION FOR BEING TAKEN TO THE MARKET. ( V ) NO PROCESS OTHER THAN ORDINARILY EMPLOYED BY A CULTIVATOR OR RECEIVER OF RENT IN KIND HAS BEEN EMPLOYED. ( VI ) OUTS IDE THE JURISDICTION OF ANY MUNICIPALITY OR CANTONMENT BOARD HAVING A POPULATION OF NOT LESS THAN 10,000/ - PERSONS. ( VII ) PROOF OF SELLING THE AGRICULTURAL PRODUCE IN A RAW STATE OR AFTER APPLICATION TO IT OF ANY PROCESS ORDINARILY EMPLOYED BY A CULTIVATOR OR RE CEIVED OF REND IN KIND TO RENDER IT FIT. ( VIII ) THE PROOF OF INCLUSION OF THE NET AGRICULTURAL INCOME FOR RATE PURPOSES IN THE TOTAL INCOME OF AN ASSESSEE AS SET OUT IN PART - IV OF THE SCHEDULE TO THE RELEVANT FINANCE ACT. ( IX ) PROOF/EVIDENCE OF MARKET VALUE OF THE AGRICULTURAL PRODUCE SOLD. ( X ) EVIDENCE OF THE RATE, QUALITY AND KIND OF THE PRODUCE SOLD. ( XI ) PROOF OF HAVING GRANTED RIGHTS TO THE USER OF THE LAND IF IT IS CLAIMED THAT THE LAND WAS GIVEN TO SOME SHARE CROPPER FOR CULTIVATION. ( XII ) PROOF OF HAVING CARRIED OUT AGRICU LTURAL OPERATIONS TO EARN THE AGRICULTURAL INCOME SHOWN BY THE BENEFICIARY. ( XIII ) DISTANCE OF THE LAND FROM THE URBAN AREA AND LOCAL RATE ASSESSMENT AND COLLECTION BY OFFICERS OF THE GOVT. OF THE 17 AGRICULTURAL LAND IF NO ASSESSMENT TO LAND REVENUE OR LOCAL RATE THEN LAND MUST BE REFERRED TO AS LOCATED IN URBAN AREA IN CASE AN ASSESSEE CLAIMS TO HAVE EARNED AGRICULTURAL INCOME ON THE SALE OF AGRICULTURAL LAND. ( XIV ) PROOF OF HAVING SOLD THE AGRICULTURAL PRODUCE IN THE OPEN MARKET OR IN ONE S OWN RETAIL SHOP. ( XV ) PROOF OF H AVING GROWN THE AGRICULTURAL PRODUCE DIRECTLY FROM ANY LAND USED FOR AGRICULTURAL PURPOSES. ( XVI ) PROOF OF HAVING DERIVED THE AGRICULTURAL INCOME FROM DIRECT CONNECTION WITH THE AGRICULTURAL LAND SHOWING CULTIVATION OF THE GROUND, TILLING OF THE LAND, SOWING OF THE SEEDS, PLANTING AND SIMILAR OPERATIONS ON THE LAND, EXPENDITURE ON HUMAN LABOUR AND SKILL, WEEDING, DIGGING THE SOIL AROUND THE GROWTH, REMOVAL OF UNDESIRABLE GROWTH, PRESERVATION OF THE CROPS FROM INSECTS AND PESTS, PROTECTION FROM DEPREDATIONS BY CAT TLE, TENDING PRUNING, CUTTING ETC. ( XVII ) WHETHER THE SAME LANDS YIELDING AGRICULTURAL INCOME IN EARLIER AND SUBSEQUENT YEARS OR CULTIVATOR OR RECEIVED OF RENT IN KIND SIMPLE MANUAL PROCESS OR USE AND ASSISTANCE OF MACHINERY. ( XVIII ) MARKET WHETHER THE AGRICULTURAL PRODU CE SOLD. ( XIX ) THE NATURE OF PRODUCE ALSO HAS NO RELEVANCE TO THE CHARACTER OF AGRICULTURAL OPERATIONS. BESIDES AGRICULTURAL DOES NOT EXTEND TO THOSE ACTIVITIES WHICH DO NOT HAVE RELATION TO THE LAND OR ARE IN SOME REMOTE WAY CONNECTED WITH LAND. SOMETHING IS TO BE DONE TO THE LAND BY HUMAN OR MECHANICAL AGENCY. IN THIS CONTEXT, THE RELEVANT PART OF THE 18 JUDGMENT OF THE HON BLE MADRAS HIGH COURT RENDERED IN A CASE IS WORTH QUOTING: - A MERCHANT WHO PURCHASES THE STANDING CROP DERIVES PROFIT FROM HIS CONTRACT OF PURCHASE AT AN ADVANTAGEOUS PRICE AND RESALE OF THE PRODUCE AT A HIGHER PRICE. THE LAND IS NOT THE DIRECT OR IMMEDIATE OR EFFECTIVE SOURCE OF HIS INCOME. AGRICULTURE INCOME CANNOT BE SAID TO ACCRUE TO EVERY PERSON INTO WHOSE HANDS THE PRODUCE OF THE LAND PASSES. THE DECISION IS AN AUTHORITY FOR THE PROPOSITION THAT TO CONSTITUTE AGRICULTURAL, INCOME THE LAND MUST BE THE DIRECT OR IMMEDIATE OR EFFECTIVE SOURCE OF INCOME. 10 .2 THE LD. CIT - ( A ) FURTHER OBSERVED THAT THE ASSESSEE HAS FILED ONLY FOLLOWING EVIDENCE S TO DEMONSTRATE THE AGRICULTURE ACTIVITY: ( I ) FIGURE OF EXPENSES FOR AGRICULTURE OPERATIONS ( II ) SALES RECEIPT OF AGRICULTURE GOODS SOLD ( III ) PROOF OF OWNERSHIP OF LANDS 10 .3 A FTER APPRAISING THE EVIDENCES OF THE ASSESSEE, THE LD. CIT - ( A ) UPHELD THE ADDITION WITH FOLL OWING OBSERVATION: . THE ABOVE SUBMISSIONS OF THE APPELLANT WERE DULY CONSIDERED BY ME. UPON APPRECIATING THE ENTIRE FACTS AND CIRCUMSTANCES OF THE CASE, I AM OF THE FIRM VIEW THAT THE APPELLANT FAILED TO ESTABLISH ITS CASE BY PRODUCING EVIDENCE OF BASIC OPERATIONS CARRIED OUT BY IT FOR EARNING AGRICULTURAL INCOME. IT DID NOT MEET THE ENTIRE REQUIREMENTS OF THE STATUTE IN RESPECT OF AGRICULTURAL INCOME IN AS MUCH AS IT FAILED TO PRODUCE THE PROOF OF PERFORMANCE OF ANY PROCESS ORDINARILY EMPLOYED BY A CULTIVATOR OR RECEIVER OF R ENT IN KIND, PROOF OF HAVING RENDERED THE PRODUCE RAISED OR RECEIVED BY HIM IN A FIT CONDITION FOR BEING TAKEN TO THE MARKET WITHOUT APPLYING ANY PROCESS OTHER THAN ORDINARILY EMPLOYED BY A CULTIVATOR OR RECEIVER OF RENT IN KIND, PROOF/EVIDENCE OF THE MARK ET VALUE OF THE AGRICULTURAL 19 PRODUCE SOLD, EVIDENCE OF THE RATE, QUALITY AND KIND OF THE PRODUCE SOLD, PROOF OF HAVING GRANTED RIGHTS TO THE USER OF THE LAND WHERE IT WAS GIVEN TO SOME SHARE CROPPER OF CULTIVATION, PROOF OF HAVING DERIVED THE AGRICULTURAL INCOME OF RS.7,59,528/ - FROM DIRECT CONNECTION WITH THE AGRICULTURAL LAND SHOWING CULTIVATION OF THE GROUND, TILLING OF THE LAND, SOWING OF THE SEEDS, PLANTING AND SIMILAR OPERATIONS ON THE LAND, EXPENDITURE ON HUMAN LABOUR AND SKILL, WEEDING, DIGGING THE SOIL AROUND THE GROWTH, REMOVAL OF UNDESIRABLE GROWTH, PRESERVATION OF THE CROPS FROM INSECTS AND PESTS, PROTECTION FROM DEPREDATIONS BY CATTLE, TENDING, PRUNING, CUTTING ETC., & MARKET WHERE THE AGRICULTURAL PRODUCE SOLD. ALL THAT THE APPELLANT HAD IN ITS POSSESSION WAS THE AMOUNT OF EXPENDITURE INCURRED BYIT ON BASIC OPERATIONS BUT NO BILLS ETC. WERE AVAILABLE WITH IT TO ESTABLISH THAT THE APPELLANT COMPANY DERIVED INCOME FROM AGRICULTURAL ALSO. EVEN THE KHASERA KHATUNI DID NOT INDICATE THE VOLUME OF AGRI CULTURAL PRODUCE GROWN AND SOLD BY THE APPELLANT. . 10 .4 B EFORE US , THE LD. COUNSEL FIELD PAPER BOOK AND REFERRED TO PAGE 31 TO 32 OF THE PAPER BOOK, WHICH ARE COPY OF RECEIPT OF AGRICULTURE PRODUCE SOLD. THE LD. COUNSEL ALSO REFERRED TO PAGES 268 TO 273 OF THE PAPER BOOK, WHICH ARE COPY OF LAND REVENUE RECORDS SHOWING OWNERSHIP AND AGRICULTURE PRODUCE SOWN ON THE LAND. THE LD. COUNSEL SUBMITTED THAT LD. CIT - (A) WAS NOT JUSTIFIED IN REJECTING THE EVIDENCES SUBSTANTIATING THE AG RICULTURE ACTIVITY OF THE ASSESSEE. 10 .5 THE LD. CIT ( DR ), ON THE OTHER HAND , SUBMITTED THAT THE ASSESSEE HAS NOT SHOWN ANY VOUCHERS OR EVIDENCES INCURRED IN RELATIO N TO AGRICULTURE ACTIVITY. SHE ALSO POINTED OUT THAT IN THE BILLS OF SALE OF AGRICULTURAL PRODUCE, THE ITEM SOL D IS RECORDED AS 20 BASMATI DHAN , WHEREAS NO SUCH PRODUCE IS RECORDED IN THE LAND REVENUE R ECORD S . ACCORDING TO HER, THE DOCUMENT FURNISHED BY THE ASSESSEE, DO NOT DEMONSTRATE THE QUANTUM OF AGRICULTURE INCOME EARNED BY THE ASSESSEE. 10 .6 WE HAVE HEARD THE RIVAL SUBMISSION AND PERUSED THE RELEVANT MATERIAL ON RECORD. IT IS EVIDENT THAT NO EVIDENCE SUPPORTING THE EXPENSES INCURRED FOR EARNING AGRICULTURE INCOME HAS BEEN SUBMITTED BY THE ASSESSEE. WE HAVE ALSO NOTICED INCONSISTENCY IN THE AGRICULTURE PRODUCE SOLD AND AGRICULTURE PRODUCE RECORDED IN THE LAND R EVENUE RECORDS. ACCORDING TO THE BILLS, WHICH ARE AVAILABLE ON PAGE 31 TO 32 OF THE PAPER BOOK, AGRI CULTURE PRODUCE SOLD IS DHAN B ASMATI , WHEREAS THE AGRICULTURE PRODUCE RECORDE D IN LAND R EVENUE RECORDS CORRESPONDING TO THE LAND OF THE ASSESSEE (AVAILABLE ON PAGE 269 TO 272), DHAN IS NOT MENTIONED. FURTHER, THERE ARE NO RECORDS OR EVIDENCE AS TO THE VOLUME OF AGRICULTURE PRODUCE PRODUCED FROM THE LAND. IN VIEW OF THE ABOVE DE FICIENCIES OR INCONSISTENCIES IN THE DOCUMENTARY EVIDENCE SUPPORTING THE AGRICULTURE INCOME FILED BY THE ASSESSEE, THE QUANTUM OF AGRICULTURE INCOME SHOWN BY THE ASSESS EE CANNOT BE JUSTIFIED. HOWEVER, AT THE SAME TIME IN VIEW OF THE OWNERSHIP OF THE AGRICU LTURAL LAND OF APPROXIMATELY 15 ACRE ( PAGE 268 OF THE PAPER BOOK) EARNING OF SOME AGRICULTURE INCOME CANNOT BE DENIED. 10 .7 THE LD. CIT(A) HAS NOT APPRECIATED THE FACTS AND CIRCUMSTANCES OF THE CASE PROPERLY AND REJECTED THE ENTIRE CLAIM OF AGRICULTURAL INCOME OF THE ASSESSEE, IGNORING THE LAND HOLDING OF THE ASSESSEE. IN OUR OPINION, IN VIEW OF LAND HOLDING AND LAND R EVENUE RECORDS OF SOWING CROPS OVER THE LAND , SOME AGRICULTURAL 21 INCOME CANNOT BE DENIED AND IN SUCH CIRCUMSTANCES, WE HAVE NO ALTERNATIVE OTHER THAN ESTIMATION OF AGRICULTURAL INCOME. KEEPING IN VIEW THE FACTS AND CIRCUMSTANCES OF THE CASE, WE FEEL IT APPROPRIATE TO RESTRICT AGRICULTURE INCOME OF RS. 10,000 PER ACRE AND , THUS , ACCORDING TO THE LAND HOLDING OF APPROX. 15 ACRES , THE AGRICULTURE INCOME OF TH E ASSESSEE IS RESTRICTED TO RS. 1,50,000/ - AND BALANCE AGRICULTURE INCOME SHOWN BY THE ASSESSEE IS HELD AS UNDISCLOSED INCOME OF THE ASSESSEE. THE GROUNDS NO. 1 TO 3 OF THE APPEAL ARE ACCORDINGLY PARTLY ALLOWED. 11 . THE GRO UND NO. 3 OF THE APPEAL OF THE R EVENUE RELATES TO ADDITIONAL/FRESH EVIDENCES ADMITTED BY THE LD. CIT - ( A ) UND ER R ULE 46A OF INCOME TAX R ULES, 1962. 11 .1 THE CONTENTION OF THE R EVENUE IS THAT ADDITIONAL EVIDENCES HAVE BEEN ADMITTED BY THE LD. CIT - ( A ) IN VIOLATION OF THE RULE 4 6A OF THE RULES. THE LD. CIT (DR) ARGUING THE GROUND SUBMITTED THAT DURING REMAND PROCEEDING, THE ASSESSING OFFICER OBJECTED TO THE ADMISSION OF THE ADDITIONAL EVIDENCES. SHE REFERRED TO THE RELEVANT PARAGRAPH OF THE REMAND REPORT, W HICH HAS BEEN REPRODUCED BY THE LD. CIT - ( A ) IN THE IMPUGNED ORDER. ACCORDING TO HER, THE ASSESSING OFFICER CLEARLY REQUESTED THAT IF THE ADDITIONAL EVIDENCES WERE ADMITTED BY THE LD. CIT - (A) , THEN HE SHOULD BE ALLOWED TIME FOR IN - DEPTH ENQUIRY/EXAMINATION OF THE ADDITIONAL EVIDENCES. 11 .2 ON THE OTHER HAND , LD. COUNSEL OF THE ASSESSEE RELIED ON THE FINDING OF THE LD. CIT - ( A ) ON THE ISSUE IN DISPUTE AND SUBMITTED THAT NO ADDITIONAL EVIDENCES WERE FURNISHED BEFORE THE LD. CIT - (A) AND THIS FACT WAS ALSO ADMITTED BY THE ASSESSING OFFICER IN THE REMAND REPORT. ACCORDING TO THE LD. C OUNSEL , THERE WAS NO 22 VIOLATION OF THE RULE 4 6A OF T HE I NCOME TAX R ULES BY THE LD. CIT - (A). 12 . THE GROUND NO . 1 OF T HE APPEAL OF THE R EVENUE RELATES TO CIT - ( A ) DELETING OF ADDITION OF RS. 4,09,76,000/ - BY THE LEARNED CIT - ( A ) OUT OF THE TOTAL ADDITION OF RS.4,17,35,528/ - MADE BY THE ASSESSING OFFICER ON ACCOUNT OF UNEXPLAINED ENTRIES APPEARING IN BANK ACCOUNT. 12 .1 BEFORE THE LD. CIT(A), THE ASSESSEE CLAIMED THAT ALL THE DEBIT AND CREDIT ENTRIES OF THE BANK ACCOUNTS WERE DULY EXPLAINED TO THE ASSESSING OFFICER DURING ASSESSMENT PROCEEDING ALONG WITH NECESSARY SUPPORTING EVIDENCES, DESPITE THAT THE ASSESSING OFFICER MADE AD DITION. IT WAS CONTENDED BY THE ASSESSEE THAT THE IMPUGNED BANK ACCOUNT WAS NOT AN UNDISCLOSED OR CONCEALED BANK ACCOUNT AND THE SAID BANK ACCOUNT WAS REFLECTED IN THE RETURN OF INCOME FILED BY THE ASSESSEE. THE ASSESSEE ALSO FILED EXPLANATION OF ALL DEBIT AND CREDIT ENTRIES OF BANK ACCOUNT BEFORE THE LD. COMMISSIONER OF INCOME - TAX ( APPEALS) ALONGWITH SUPPORTING EVIDENCES. THE LD. CIT - ( A ) FORWARDED EXPLANATION OF THE ASSESSEE AS WELL AS SUPPORTING DOCUMENTS TO THE ASSESSING OFFICER FOR HIS COMMENT. THE ASSESSING OFFICER IN HIS REMAND REPORT ONLY REITERATED FINDING OF THE ASSESSMENT ORDER THAT THE ASSESSEE FAILED TO FURNISH THE COMPLETE DET AIL WITH EXPLANATION IN REGARD CREDIT ENTRIES. IN VIEW OF THE REMAND REPORT, THE LD. CIT - ( A ) INFERRED THAT THE ASSESSING OFFICER HAD NO RESERVATION ON THE GENUINENESS OF THE EXPLANATION GIVEN BY THE ASSESSEE IN REGA RD TO THE CREDIT ENTRIES OF RS. 4,17,35,52 8/ - . THE LD. CIT - ( A ) ANALYZED EACH AND EVERY ENTRY AND DELETED TH E ADDITION EXCEPT AMOUNT OF RS. 7,59,528/ - , WHICH WAS THE AMOUNT OF AGRICULTURE INCOME 23 CLAIMED BY THE ASSESSEE AS EXEMPT. SINCE THE LEARNED CIT - ( A ) ALREADY HELD THOSE CREDITS AS INCOME FROM OT HER SOURCES, THEREFORE, DIRECTED THE ASSESSING OFFICER NOT TO CONSIDER FOR ADDITION AS UNEXPLAINED CREDIT IN BANK ACCOUNT. THE RELEVANT FINDING OF THE LD. CIT - ( A ) ARE REPRODUCED AS UNDER: COMING TO MY FINDINGS ON THE CREDIT ENTRIES IN THE IMPUGNED BANK A CCOUNT. THE LAST COLUMN OF THE CHART ABOVE INDICATES THE SOURCES OF THE CREDITS IN THE BANK ACCOUNT. AS REGARDS DEPOSITS OF RS.25,000/ - ON 13/4/2007, RS. 8,000/ - ON 13/4/2007, RS.51 LAKHS ON 8/10/2007 & RS. 6 LAKHS ON 28/3/2008, BEING CHEQUES RETURNS THE S AME WERE IN THE NATURE OF CONTRA ENTRIES HAVING NO IMPACT ON THE REVENUE AS WAS EVIDENT FROM PAGES 20 &21 OF THE PAPER BOOK. THEREFORE, THE ADDITION OF RS.57,33,000/ - IS DELETED. AS REGARDS DEPOSITS OF RS.25,000/ - & RS.8,000/ - ON 16/4/2007 THE SAME IS BO RNE OUT FROM THE EVIDENCE FILED ON RECORD. AS REGARDS DEPOSIT OF RS.10 LAKHS ON 18/4/2007 PAGE 21 OF THE BANK STATEMENT FORMING A PART OF THE PAPER BOOK WAS REFERRED TO WHEREIN NO SUCH ENTRY WAS NOTICES. ACCORDINGLY, THE SAME IS DELETED. AS REGARDS DEPOS IT OF RS.41 LAKHS ON 10/10/2007, THE SAME WAS EXPLAINED AS HAVING BEEN GIVEN BY ANIL JAIN TO WHOM AN ADVANCE WAS GIVEN EARLIER. IN SUPPORT THE APPELLANT PRODUCED THE CONFIRMATION UNDER ANNEXURE - 2 OF THE PAPER BOOK SENT TO THE ASSESSING OFFICER FOR HIS COMM ENTS. THE SAID AMOUNT WAS EARLIER GIVEN BY THE APPELLANT TO ANIL JAIN WHO RETURNED THE SAME TO THE APPELLANT. IN SUPPORT OF THE CHEQUES ZEROX COPIES WERE GIVEN. ACCORDINGLY, THE ADDITION OF RS.51 LAKHS IS DELETED. RESPECTING DEPOSITS OF RS.50,000/ - ON 2 /11/2007, RS.6 LAKHS ON 29/12/2007, RS. 4 LAKHS ON 3/1/2008, RS. 8 LAKHS ON 4/3/2008, THE SAME WERE EXPLAINED AS DEPOSITS RECEIVED FROM SMT. SUDHA NAGAR BY WAY OF LOAN. 24 TO THIS EFFECT, THE APPELLANT PRODUCED THE CONFIRMATION ALONG WITH THE BANK STATEMENT O F THE LATTER TO PROVE THE GENUINE NESS AND CREDITWORTHINESS OF THE LENDER. HAVING REGARD TO THE NATURE OF EVIDENCE PRODUCED, I AM OF THE FIRM OPINION THAT THE DEPOSITS OF RS.18,50,000/ - STAND FULLY EXPLAINED. IN RESPECT OF DEPOSITS OF RS.50 LAKHS ON 14/11/2007, RS.50 LAKHS ON 23/11/2007, RS. 50 LAKHS ON 27/11/2007, RS.45 LAKHS ON 12/2/2008, RS.5 LAKHS ON 13/02/2008, RS. 5 LAKHS ON 28/3/2008, RS. 4 LAKHS ON 28/03/2008 AND RS. 2 LAKHS ON 28/03/2008 THEY WERE EXPL AINED AS HAVING BEEN TAKEN FROM MANOJ SETHI, MADHUSUDAN REALTORS P LTD., JAM INDIAN P LTD., SANJEEV CHUGH, LAKSHYA DAIRY P LTD, GRIP INFO SOLUTION P. LTD., ATUL NAGAR & ROHI NAGAR RESPECTIVELY. ANOTHER SUM OF RS.4 LAKHS WAS SHOWN AS RECEIVED ON 28/3/2008 F ROM ROHIT NAGAR. IN RESPECT OF MANOJ SETHI HIS BANKS STATEMENT AND HIS RETURN OF INCOME WERE FILED ON DEMAND APART FROM THE CONFIRMATION FILED WITH THE PAPER BOOK FORWARDED TO THE AO FOR HIS COMMENTS. ACCORDINGLY, ON A CONSIDERATION OF THE EVIDENCE FILED THE AMOUNT OF RS.50 LAKHS IS DELETED BEING EXPLAINED. IN RESPECT OF MADHUSUDAN REA LTORS P LTD THE CONFIRMATION FILED INDICATED THAT IT WAS A REPAYMENT OF THE LOAN EARLIER GIVE N BY THE APPELLANT IN THE ASSESSMENT YEAR 2006 - 07 TO THE APPELLANT DURING THE I MPUGNED AY. ACCORDINGLY, ON A CONSIDERATION OF THE EVIDENCE FILED THE AMOUNT OF RS.50 LAKHS IS DELETED BEING EXPLAINED. IN RESPECT OF JAM INDIA P. LTD. THE CONFIRMATION FILED WITH THE PAPER BOOK WAS FURTHER SUPPLEMENTED BY ITS RETURN OF INCOME AND THE CO PIES OF THE CHEQUE BY WHICH THE AMOUNT OF RS.50 LAKHS WAS PAID TO THE APPELLANT. THE MONEY WAS RECEIVED BY THE APPELLANT IN THE COURSE OF RUNNING TRANSACTIONS. ACCORDINGLY, ON A CONSIDERATION OF THE EVIDENCE FILED THE AMOUNT OF RS.50 LAKHS IS DELETED BEING EXPLAINED. 25 IN RESPECT OF SANJEEV CHUGH, THE CONFIRMATION FILED WITH THE PAPER BOOK WAS FURTHER SUPPLEMENTED BY ZEROX COPY OF THE BANK STATEMENT OF SANJEEV CHUGH WHICH REFLECTS THE REPAYMENT OF MONEY GIVEN BY THE APPELLANT IN THE COURSE OF BUSINESS. THE MONEY WAS RECEIVED BY THE APPELLANT IN THE COURSE OF RUNNING TRANSACTIONS. ACCORDINGLY, ON A CONSIDERATION OF THE EVIDENCE FILED THE AMOUNT OF RS.50 LAKHS IS DELETED BEING EXPLAINED. IN RESPECT OF LAKSHYA DAIRY P LTD. THE CONFIRMATION FILED WITH THE PAPE R BOOK WAS FURTHER SUPPLEMENTED BY THE COPY OF THE BANK STATEMENT WHEREIN THE AMOUNT OF RS.5 LAKHS WAS SHOWN AS HAVING BEEN PAID TO THE APPELLANT OUT OF ITS OD ACCOUNT. ACCORDINGLY, ON A CONSIDERATION OF THE EVIDENCE FILED THE AMOUNT OF RS.5 LAKHS IS DELET ED BEING EXPLAINED. IN RESPECT OF GRIP INFO SOLUTION P LTD. THE CONFIRMATION FILED WITH THE PAPER BOOK WAS FURTHER SUPPLEMENTED BY THE COPY OF THE BANK STATEMENT WHEREIN THE AMOUNT OF RS.5 LAKHS WAS SHOWN AS HAVING BEEN PAID TO THE APPELLANT OUT OF ITS CA ACCOUNT. ACCORDINGLY , ON A CONSIDERATION OF THE EVIDENCE FILED THE AMOUNT OF RS.5 LAKHS IS DELETED BEING EXPLAINED. IN RESPECT OF ATUL NAGAR & ROHIT NAGAR THE CONFIRMATION FILED WITH THE PAPER BOOK WAS FURTHER SUPPLEMENTED BY THE COPY OF THE BANK STATEMENTS WHEREIN THE AMO UNT OF RS. 10 LAKHS WERE SHOWN AS HAVING BEEN PAID TO THE APPELLANT OUT OF ITS CURRENT ACCOUNT. ACCORDINGLY, ON A CONSIDERATION OF THE EVIDENCE FILED THE AMOUNT OF RS.10 LAKHS IS DELETED BEING EXPLAINED. REGARDING THE DEPOSITS OF RS.23,50,000/ - ON 29/10/2007, RS. 11 LAKHS ON 23/1/2008, RS. 22 LAKHS 31/1/2008, RS. 35,000/ - ON 7/2/2008, RS. 75,000/ - ON 27/3/2008, THE SAME WERE EXPLAINED AS HAVING BEEN RECEIVED FROM M/S. AIMS PROMOTERS P LTD. THE SAME IS A SUBJECT MATTER OF CONSIDERATION OF DEEMED DIVI DEND. 26 IN ANY CASE THE CONFIRMATION FILED WITH THE PAPER BOOK WAS FURTHER SUPPLEMENTED BY THE COPY OF BANK STATEMENTS ON DEMAND WHEREIN THE ABOVE AMOUNTS WERE SHOWN AS HAVING BEEN PAID TO THE APPELLANT OUT OF ITS CURRENT ACCOUNT. ACCORDINGLY, ON A CONSIDE RATION OF THE EVIDENCE FILED THE AMOUNT OF RS.57,60,000/ - LAKHS IS DELETED BEING EXPLAINED. AS TO THE DEPOSITS OF RS.6,36,283/ - AND RS.1,23,245/ - ON 16/2/2008 & 22/ /2/2008, THE SAME HAVE BEEN HELD AS TAXABLE INCOME CLAIMED AS EXEMPT BY THE APPELLANT IN T HE GARB OF AGRICULTURAL INCOME. ACCORDINGLY, THE SAME IS HELD AS INCOME FROM OTHER SOURCES AND LIABLE TO TAX. HOWEVER, TO PREVENT DOUBLE JEOPARDY THE AMOUNT OF RS.7,59,528/ - SHALL NOT BE BROUGHT TO TAX SEPARATELY. ACCORDINGLY, GROUND NO. 2 IS PARTLY ALLOWE D. 12 .2 THE GROUND NO. 4 OF THE APPEAL OF THE ASSESSEE RELATES TO ADDITION AS DEEMED DIVIDEND UNDE R SECTION 2(22)( E) OF THE ACT. THE GRO UND NO. 2 OF THE APPEAL OF THE R EVENUE ALSO RELATE TO THIS ADDITION. 12 .3 THE FACTS QUA THE ADDITION ARE THAT DURI NG THE RELEVANT YEAR M/S NAGAR DAIRY PRIVATE L IMITED (NDPL) RECEIVED UNSECURED LOAN OF RS.73,69, 560/ - FROM M/S AIMS P R OMOTER PRIVATE L IMITED (APPL). THE ASSESSEE I.E. SH . MALOOK NAGAR WAS HAVING 50% SHAREHOLDING IN APPL AND 66.33% IN NDPL. ACCORDING TO THE ASSESSING OFFICER, THE ASSESSEE WAS HAVING SUBSTANTIAL INTEREST IN BOTH THE COMPANIES AND THE AMOUNT OF LOAN WAS GIVEN ON THE DIRECTION OF THE ASSESSEE BEING CONTROLLING PERSON IN BOTH THE COMPANIES, THE SAID LOAN WAS IN THE NATURE OF DEE MED DIVIDEND U NDER SECTION2(22)(E) OF THE ACT AND IN VIEW O F THE ACCUMULATED PROFIT OF 27 RS.9,56, 634/ - AS ON 31/03/2008, HE RESTRICTED THE ADDITION OF DEEMED DIVIDEND TO THE EXTENT OF RS. 9, 5 6, 634/ - . 1 2 .4 BEFORE THE LD. CIT - ( A ) , THE ASSESSEE SUBMITTED ADDITIONAL EVIDENCES IN THE FORM OF COPY OF MOU ENTERED BETWEEN APPL AND NDPL FOR PURCHASE OF LAND AT SHAHPUR, HAPUR, GHAZIABAD AND, CONTENDED THAT THE TRANSACTION BETWEEN THE COMPANIES WERE NORMAL BUSINESS TRANSACTIONS AND THUS PROVISIONS OF SECTION 2(22) (E) WERE NOT ATTRAC TED. THOSE ADDITIONAL EVIDENCES WERE FORWARDED TO THE ASSESSING OFFICER FOR HIS COMMENTS. FURTHER , IT WAS SUBMITTED THAT NDPL REIMBURSED RENT EXPENSES OF RS. 4,69,560/ - AFTER DEDUCTING TDS OF RS. 1, 06,402/ - IN VI EW OF SHARING PREMISES AT ANSAL CHAMBERS, BHIK AJI CAMA P LACE , NEW DELHI TO APPL AS PER AGREEMENT ENTERED ON 01/09/2007 AND , THUS , REIMBURSEMENT OF RENT EXPENSES RECEIVABLE COULD NOT BE CONSIDERED TO BE DEEMED DIVIDEND U/S 2(22)(E ) OF THE ACT. 12 .5 THE LEARNED CIT - ( A ) AFTER CONSIDERING THE REMAND REPORT OF THE ASSESSING OFFICER AND SUBMISSION OF THE ASSESSEE , ACCEPTED ARGUMENTS OF THE ASSESSEE FOR NOT TREATING THE REIMBURSEMENT OF RENT HOWEVER, HE REJECTED T HE ARGUMENTS THAT AMOUNT OF RS.6,33, 476/ - WAS GIVEN BY THE NDP L AS ADVANCE FOR SPACE IN THE COMMERCIAL PROJECTS OF APPL FOR ITS SHOWROOM . THE LEARNED CIT - ( A ) ANALYZED RELEVANT MEMORANDUM OF UNDERSTANDING BETWEEN APPL AND NDPL AND CONCLUDED AS UNDER: THE ABOVE FACTS IN RESPECT OF THE ADVANCES RECEIVED BY THE APPELLA NT S COMPANY FOR CONSTRUCTING RESIDENTIAL COLONIES WERE DULY EXAMINED BY ME. UPON CAREFUL CONSIDERATION OF THE FACTS OF THE MATTER AND THE EVIDENCE BROUGHT ON RECORD IT WAS NOTICES THAT THE APPELLANT S 28 COMPANY RECEIVED CONSIDERATIONS FOR SOME PROJECTS LIKE LY TO COME UP IN FUTURE SUBJECT TO VARIOUS CONDITIONS THE MOST IMPORTANT BEING THAT OF GETTING THE NATURE OF THE LAND CONVERTED INTO NON - AGRICULTURAL FROM AGRICULTURAL. HOWEVER, THE EVIDENCE OF THE LANDS PURCHASED AND SOLD COULD NOT BE PRODUCED. MOREOVER, IT WAS NOT CLEAR AS TO WHY THE COMPANY M/S NAGAR DAIRY P LTD. GAVE ADVANCES EVEN BEFORE THE LANDS ON WHICH THE PROJECTS WERE LIKELY TO BE UNDERTAKEN WERE FREE FROM ENCUMBRANCES. TRADE MEANS SOME ONGOING ACTIVITIES IN PRESENT. SINCE IT WAS NOT NECESSARY, NO RMAL AND INCIDENTAL TO ADVANCE SUCH MONEY WITHOUT EVEN THE EXISTENCE OF THE SUITABLE LAND, THE ADVANCE OF RS.6,33,476/ - IS NOT HELD AS HAVING BEEN GIVEN IN THE COURSE OF BUSINESS. MOREOVER, THE PROOF OF PURCHASE AND REGISTRATION OF THE LANDS ON WHICH THE P ROJECTS OF RESIDENTIAL COLONIES AND SHOWROOM ETC. WERE TO COME UP WAS NOT AVAILABLE. SIMILARLY, THE AGREEMENTS TO SELL WITH THE PROOF OF REGISTRATION FOR LANDS ALLEGEDLY SOLD TO M/S. AIMS PROMOTERS P LTD. WERE ALSO NOT PROVIDED. THE PROOF OF PURCHASE AND REGISTRATION OF THE SAME LANDS BY M/S. NAGAR DAIRY P. LTD. FOR WHICH ADVANCES WERE GIVEN BY M/S. AIMS PROMOTERS P LTD. WERE ALSO NOT THERE. THE APPROVALS OF THE GOVERNMENT AUTHORITIES FOR CONSTRUCTING COMMERC IAL COMPLEXES AT MEERUT AND RESIDENTIAL COLONIES AT VILLAGE SHAKARPUR, PARAGANA TEHSIL HAPUR, DISTT. - GHAZIABAD WERE ALSO MISSING. MOREOVER, THE REASON WHY THE SUMS OF MONEY INSTEAD OF BEING CREDITED INTO THE BANK ACCOUNT OF M/S. AIMS PROMOTERS P LTD. WERE DEPOSITED IN THE APPELLANT S BANK ACCOUNT WAS ALSO NOT CLEAR. TO CROWN IT ALL THE SHAREHOLDER CUM DIRECTOR SH. MALOOK NAGAR RECEIVED THE MONEY EVEN BEFORE THE COMMENCEMENT OF THE SO CALLED PROJECTS WHICH WAS HIGHLY QUESTIONABLE AS THE ADVANCES WERE CONTIN GENT ON THE HAPPENING OF CERTAIN EVENTS IN FUTURE FAILING WHICH THE ENTIRE AMOUNT WOULD BECOME REFUNDABLE TO THE LENDER I.E. M/S. NAGAR DAIRY P LTD. IT IS PERTINENT TO ADD HERE THAT TRADE ADVANCES DO NOT CARRY ANY OBLIGATION OF REPAYMENT NORMALLY. IN THE I NSTANT CASE M/S. AIMS PROMOTERS P LTD. WAS RESTRAINED FROM MAKING ANY INVESTMENTS OUT OF THE ADVANCES RECEIVED TILL THE TIME THE CONVERSION OF THE LANDS 29 ON WHICH THE PROJECTS WERE TO COME UP INTO NON - AGRICULTURAL FROM AGRICULTURAL WAS OBTAINED. IN THE IMPU GNED ASSESSMENT YEAR THERE WAS NO SIGN OF ANY SUCH MOVEMENT OR PROGRESS IN THE MATTER. ACCORDINGLY, THE ADVANCES ARE NOT CONSIDERED TO HAVE BEEN GIVEN IN THE NECESSARY, NORMAL AND ORDINARY COURSE INCIDENTAL TO THE BUSINESS OF THE APPELLANT S COMPANY. IN VIEW OF THE TYPICAL FACTS AS ABOVE THE CASE LAWS RELIED ON BY THE APPELLANT ON THIS ISSUE OF DEEMED DIVIDEND ARE NOT HELD AS APPLICABLE. IN THE AFORESAID VIEW OF THE MATTER, THE AMOUNT OF RS.6,33,476/ - IS HELD AS DEEMED DIVIDEND. ACCORDINGLY, THE GROUNDS OF APPEAL NO. 3 IS PARTLY ALLOWED. 12 .6 A GGRIEVED WITH THE ABOVE FINDI NGS, BOTH THE ASSESSEE AND THE R EVENUE ARE IN APPEAL BEFORE THE TRIBUNAL. 13 . BEFORE US , THE LD. COUNSEL OF THE ASSESSEE SUBMITTED THAT THE TRANSACTION BETWEEN THE TWO COMPANIES WAS IN THE NATURE OF BUSINESS TRANSACTION. ACCORDING TO HIM, M/S . APPL WAS ENGAGED IN THE BUSINESS OF REAL ESTATE DEVELOPMENT AND HAS ENTERED INTO MOU WITH NDPL FOR PURCHA S E OF LAND AND IN PURSUANCE TO WHICH, ADVANCES WERE MADE AND , THUS , SUCH TRANSACTIONS BETWEEN THE SAID TWO COMPANIES ARE RENDER ED IN NORMAL COURSE OF BUSINESS . HE ALSO SUBMITTED THAT IN ANOTHER GROUP CASE OF MRS. SUDHA NAGAR THE TRIBUNAL IN ITA NO. 5533 TO 5539/DEL/2 014, HAS RESTORED THE ISSUE TO THE FILE OF THE ASSESSING OFFICER FOR DECIDING AFRESH. ACCORDING TO HIM , THE FACTS AND CIRCUMSTANCES OF THE PRESENT ISSUE IN DISPUTE ARE IDENTICAL TO THE FACTS AND CIRCUMSTANCES IN THE CASE OF SUDHA NAGAR (SUPRA). FURTHER , H E SUBMITTED THAT THE ACCUMULATED PROFIT FOR RESTRICTING THE AMOUNT 30 OF DEEMED DIVIDEND SHOULD BE COMPUTED ON THE DATE OF TRANSACTION AND NOT IN THE YEAR - END. 13 .1 ON THE OTHER HAND, LD. CIT(DR) CONTENDED THAT THE ASSESSEE FAILED TO ESTABLISH ANY BUSINESS CONNECTION BETWEEN THE TWO COMPANIES OR ANY BUSINESS EXPEDIENCY FOR GIVING LOANS. ACCORDING TO HER, THE MOU IS ONLY A SELF SERVING DOCUMENTS AND NO SUCH TRANSFER OF LAND WAS EVER EXECUTED BETWEEN THE COMPANIES. ACCORDING TO HER, REIMBURSEMENT OF RENT SHOUL D HAVE BEEN CONSIDERED FOR EXCLUSION, PRIOR TO RESTRICTION OF DEEMED DIVIDEND TO THE ACCUMULATED PROFIT OF COMPANY, WHO HAS GIVEN LOAN. 13 .2 WE HAVE HEARD THE RIVAL SUBMISSION OF THE PARTIES IN RELATION TO GROUND N O. 1, 2 AND 3 OF THE APPEAL OF R EVENUE AND GROUND NO. 4 OF THE APPEAL OF THE ASSESSEE AND PERUSED THE RELEVANT MATERIAL ON RECORD. BOTH THE ISSUES OF CREDIT ENTRIES IN BANK ACCOUNTS AND DEEMED DIVIDEND ARE RELATED TO THE ISSUE OF ADDITIONAL EVIDENCES RAISED BY THE REVENUE AND , THUS, WE ARE FIRS T TAKING UP THE ISSUE OF ADMITTING ADDITIONAL EVIDENCES BY THE LD. CIT(A) RAISED BY THE REVENU E IN GROUND NO. 3 OF THE APPEAL, WHICH GOES TO THE ROOT OF THE ADDITION TOWARD CREDITS IN BANK ACCOUNT AND DEEMED DIVIDEND. 13 .3 THE LD. CIT - ( A ) WHILE ADM ITTING THE ADDITIONAL EVIDENCES , HELD THAT THE REQUIREMENT OF INTENSIVE ENQUIRY INTO THE EVIDENCE WAS ONLY PERFUNCTORY STATEMENT WITHOUT APPLICATION OF MIND AND IT WAS MADE IN THE CUSTOMARY FASHION WITHOUT SANCTION OF LAW AND MANNER NOT KNOWN TO THE LAW. THEREAFT ER , THE LEARNED CIT - ( A ) REFERRED THE PARA OF THE REMAND REPORT AND OBSERVED THAT ACCORDING TO THE ASSESSING OFFICER NO ADDITIONAL EVIDENCES WERE FURNISHED. THE LEARNED CIT - ( A ) THEREAFTER CONSIDERED THE 31 DOCUMENTS/EVIDENCES FILED BY THE ASSESSEE AND DECIDED APPEAL. THE ISSUE OF ADMITTING OF ADDITIONAL EVIDENCES AND THEREAFTER PROVIDING OPPORTUNITY TO THE ASSESSING OFFICER FOR HIS COMMENTS HAS BEEN DISCUSSED BY THE HON BLE HIGH COURT OF DELHI IN THE CASE OF COMMISSIONER OF INCOME TAX VS. MANISH BUILD WELL (P) LTD REPORTED IN (2011) 245 CTR 0397 . THE RELEVANT PARAGRAPH OF THE DECISION OF THE H O N B L E DELHI HIGH COURT IS REPRODUCED AS UNDER: 23. IT IS FOR THE AFORESAID REASON THAT R. 46A STARTS IN A NEGATIVE MANNER BY SAYING THAT AN APPELLANT BEFORE THE CIT(A) SHALL NOT BE ENTITLED TO PRODUCE BEFORE HIM ANY EVIDENCE, WHETHER ORAL OR DOCUMENTARY, OTHER THAN THE EVIDENCE ADDUCED BY HIM BEFORE THE AO . AFTER MAKING SUCH A GENERAL STATEMENT, WHICH IS IN CONSONANCE WITH THE PRINCIPLE STATED IN THE ABOVE JUDGMENT, EXCEPTIONS HAVE BEEN CARVED OUT THAT IN CERTAIN CIRCUMSTANCES IT WOULD BE OPEN TO THE CIT(A) TO ADMIT ADDITIONAL EVIDENCE. THEREFORE, ADDITIONA L EVIDENCE CAN BE PRODUCED AT THE FIRST APPELLATE STAGE WHEN CONDITIONS STIPULATED IN THE R. 46A ARE SATISFIED AND A FINDING IS RECORDED. RULE 46A READS : '46A. PRODUCTION OF ADDITIONAL EVIDENCE BEFORE THE DEPUTY COMMISSIONER (APPEALS) AND COMMISSIONER (AP PEALS). (1) THE APPELLANT SHALL NOT BE ENTITLED TO PRODUCE BEFORE THE DEPUTY COMMISSIONER (APPEALS) OR, AS THE CASE MAY BE, THE COMMISSIONER (APPEALS), ANY EVIDENCE, WHETHER ORAL OR DOCUMENTARY, OTHER THAN THE EVIDENCE PRODUCED BY HIM DURING THE COURSE OF PROCEEDINGS BEFORE THE ASSESSING OFFICER, EXCEPT IN THE FOLLOWING CIRCUMSTANCES, NAMELY : (A) WHERE THE ASSESSING OFFICER HAS REFUSED TO ADMIT EVIDENCE WHICH OUGHT TO HAVE BEEN ADMITTED; OR (B) WHERE THE APPELLANT WAS PREVENTED BY SUFFICIENT CAUSE FROM PRO DUCING THE EVIDENCE WHICH HE WAS CALLED UPON TO PRODUCE BY THE ASSESSING OFFICER; OR (C) WHERE THE APPELLANT WAS PREVENTED BY SUFFICIENT CAUSE FROM PRODUCING BEFORE THE ASSESSING OFFICER ANY EVIDENCE WHICH IS RELEVANT TO ANY GROUND OF APPEAL; OR 32 (D) WHERE THE ASSESSING OFFICER HAS MADE THE ORDER APPEALED AGAINST WITHOUT GIVING SUFFICIENT OPPORTUNITY TO THE APPELLANT TO ADDUCE EVIDENCE RELEVANT TO ANY GROUND OF APPEAL. (2) NO EVIDENCE SHALL BE ADMITTED UNDER SUB - R. (1) UNLESS THE DEPUTY COMMISSIONER (APPEALS ) OR, AS THE CASE MAY BE, THE COMMISSIONER (APPEALS) RECORDS IN WRITING THE REASONS FOR ITS ADMISSION. (3) THE DEPUTY COMMISSIONER (APPEALS) OR, AS THE CASE MAY BE, THE COMMISSIONER (APPEALS) SHALL NOT TAKE INTO ACCOUNT ANY EVIDENCE PRODUCED UNDER SUB - R. ( 1) UNLESS THE ASSESSING OFFICER HAS BEEN ALLOWED A REASONABLE OPPORTUNITY (A) TO EXAMINE THE EVIDENCE OR DOCUMENT OR TO CROSS - EXAMINE THE WITNESS PRODUCED BY THE APPELLANT, OR (B) TO PRODUCE ANY EVIDENCE OR DOCUMENT OR ANY WITNESS IN REBUTTAL OF THE ADDITI NAL EVIDENCE PRODUCED BY THE APPELLANT. (4) NOTHING CONTAINED IN THIS RULE SHALL AFFECT THE POWER OF THE DEPUTY COMMISSIONER (APPEALS) OR, AS THE CASE MAY BE, THE COMMISSIONER (APPEALS) TO DIRECT THE PRODUCTION OF ANY DOCUMENT, OR THE EXAMINATION OF ANY WI TNESS, TO ENABLE HIM TO DISPOSE OF THE APPEAL, OR FOR ANY OTHER SUBSTANTIAL CAUSE INCLUDING THE ENHANCEMENT OF THE ASSESSMENT OR PENALTY [WHETHER ON HIS OWN MOTION OR ON THE REQUEST OF THE ASSESSING OFFICER UNDER CL. (A) OF SUB - S. (1) OF S. 251 OR THE IMPO SITION OF PENALTY UNDER S. 271.' WE ARE HIGHLIGHTING THESE ASPECTS ONLY TO PRESS HOME THE POINT THAT THE CONDITIONS PRESCRIBED IN R. 46A MUST BE SHOWN TO EXIST BEFORE ADDITIONAL EVIDENCE IS ADMITTED AND EVERY PROCEDURAL REQUIREMENT MENTIONED IN THE RULE HA S TO BE STRICTLY COMPLIED WITH SO THAT THE RULE IS MEANINGFULLY EXERCISED AND NOT EXERCISED IN A ROUTINE OR CURSORY MANNER. A DISTINCTION SHOULD BE RECOGNIZED AND MAINTAINED BETWEEN A CASE WHERE THE ASSESSEE INVOKES R. 46A TO ADDUCE ADDITIONAL EVIDENCE BEF ORE THE CIT(A) AND A CASE WHERE THE CIT(A), WITHOUT BEING PROMPTED BY THE ASSESSEE, WHILE DEALING WITH THE APPEAL, CONSIDERS IT FIT TO CAUSE OR MAKE A FURTHER ENQUIRY BY VIRTUE OF THE POWERS VESTED IN HIM UNDER SUB - S. (4) OF S. 250. IT IS ONLY WHEN HE EXER CISES HIS STATUTORY SUO MOTU POWER UNDER THE ABOVE SUB - SECTION THAT THE REQUIREMENTS OF R. 46A NEED NOT BE FOLLOWED. ON THE OTHER HAND, WHENEVER THE ASSESSEE WHO IS IN APPEAL BEFORE HIM INVOKES R. 46A, IT IS INCUMBENT UPON THE CIT(A) TO COMPLY WITH THE REQ UIREMENTS OF THE RULE STRICTLY. 24. IN THE PRESENT CASE, THE CIT(A) HAS OBSERVED THAT THE ADDITIONAL EVIDENCE SHOULD BE ADMITTED BECAUSE THE ASSESSEE WAS PREVENTED BY ADDUCING THEM BEFORE THE AO. THIS OBSERVATION TAKES CARE OF CL. 33 (C) OF SUB - R. (1) OF R. 4 6A. THE OBSERVATION OF THE CIT(A) ALSO TAKES CARE OF SUB - R. (2) UNDER WHICH HE IS REQUIRED TO RECORD HIS REASONS FOR ADMITTING THE ADDITIONAL EVIDENCE. THUS, THE REQUIREMENT OF SUB - RS. (1) AND (2) OF R. 46A HAVE BEEN COMPLIED WITH. HOWEVER, SUB - R. (3) WHIC H INTERDICTS THE CIT(A) FROM TAKING INTO ACCOUNT ANY EVIDENCE PRODUCED FOR THE FIRST TIME BEFORE HIM UNLESS THE AO HAS HAD A REASONABLE OPPORTUNITY OF EXAMINING THE EVIDENCE AND REBUT THE SAME, HAS NOT BEEN COMPLIED WITH. THERE IS NOTHING IN THE ORDER OF T HE CIT(A) TO SHOW THAT THE AO WAS CONFRONTED WITH THE CONFIRMATION LETTERS RECEIVED BY THE ASSESSEE FROM THE CUSTOMERS WHO PAID THE AMOUNTS BY CHEQUES AND ASKED FOR COMMENTS. THUS, THE END RESULT HAS BEEN THAT ADDITIONAL EVIDENCE WAS ADMITTED AND ACCEPTED AS GENUINE WITHOUT THE AO FURNISHING HIS COMMENTS AND WITHOUT VERIFICATION. SINCE THIS IS AN INDISPENSABLE REQUIREMENT, WE ARE OF THE VIEW THAT THE TRIBUNAL OUGHT TO HAVE RESTORED THE MATTER TO THE CIT(A) WITH THE DIRECTION TO HIM TO COMPLY WITH SUB - R. (3) OF R. 46A. IN OUR OPINION AND WITH RESPECT, THE ERROR COMMITTED BY THE TRIBUNAL IS THAT IT PROCEEDED TO MIX UP THE POWERS OF THE CIT(A) UNDER SUB - S. (4) OF S. 250 WITH THE POWERS VESTED IN HIM UNDER R. 46A. THE TRIBUNAL SEEMS TO HAVE OVERLOOKED SUB - R. (4 ) OF R. 46A [SIC - S. 250] WHICH ITSELF TAKES NOTE OF THE DISTINCTION BETWEEN THE POWERS CONFERRED BY THE CIT(A) UNDER THE STATUTE WHILE DISPOSING OF THE ASSESSEE S APPEAL AND THE POWERS CONFERRED UPON HIM UNDER R. 46A. THE TRIBUNAL ERRED IN ITS INTERPRETATI ON OF THE PROVISIONS OF R. 46A VIS - - VIS S. 250(4). ITS VIEW THAT SINCE IN ANY CASE THE CIT(A), BY VIRTUE OF HIS COTERMINOUS POWERS OVER THE ASSESSMENT ORDER, WAS EMPOWERED TO CALL FOR ANY DOCUMENT OR MAKE ANY FURTHER ENQUIRY AS HE THINKS FIT, THERE WAS NO VIOLATION OF R. 46A IS ERRONEOUS. THE TRIBUNAL APPEARS TO HAVE NOT APPRECIATED THE DISTINCTION BETWEEN THE TWO PROVISIONS. IF THE VIEW OF THE TRIBUNAL IS ACCEPTED, IT WOULD MAKE R. 46A OTIOSE AND IT WOULD OPEN UP THE POSSIBILITY OF THE ASSESSEES CONTENDI NG THAT ANY ADDITIONAL EVIDENCE SOUGHT TO BE INTRODUCED BY THEM BEFORE THE CIT(A) CANNOT BE SUBJECTED TO THE CONDITIONS PRESCRIBED IN R. 46A BECAUSE IN ANY CASE THE CIT(A) IS VESTED WITH COTERMINOUS POWERS OVER THE ASSESSMENT ORDERS OR POWERS OF INDEPENDEN T ENQUIRY UNDER SUB - S. (4) OF S. 250. THAT IS A CONSEQUENCE WHICH CANNOT AT ALL BE COUNTENANCED. 13 .4 THUS , THE HON BLE HIGH COURT HAS REPRODUCED RELEVANT RULES IN ABOVE PARAGRAPHS AND HELD THAT THE LD. CIT - ( A ) AFTER ADMITTING ADDITIONAL EVIDENC ES MUST COMPLY WITH THE RULE 46A (3) OF RULES AND PROVIDE A REASONABLE OPPORTUNITY OF EXAMINING THE EVIDE NCES AND REBUT THE SAME TO THE ASSESSING O FFICER. IN THE SAID CASE , THE ADDITIONAL EVIDENCES WERE ADMITTED AND ACCEPTED AS GENUINE 34 WITHOUT ANY COMMENTS OR VERI FICATION AT THE END OF THE ASSESSING OFFICER. THE HON BLE HIGH COURT HELD THAT PROVIDING OPPORTUNITY TO R EBUT THOSE ADDITIONAL EVIDENCES , IS AN INDISPENSABLE REQUIREMENT AND THE TRIBUNAL OUGHT TO HAVE RESTORED THE MATTER TO THE LD. CIT(A) FOR COMPLYING TH E PROVISIONS OF RULE 46A(3) OF R ULES. 1 3 .5 IN THE INSTANT CASE ALSO , THE ASSESSING OFFICER OBJECTED TO ADMITTING OF THE ADDITIONAL EVIDENCES, HOWEVER, HE SUBMITTED THAT IN CASE ADDITIONAL EVIDENCES ARE ACCEPTED THAN, HE SHOULD BE PROVIDED TIME FOR MAKING I N - DEPTH ENQUIRY/INVESTIGATION IN RESPECT OF THOSE EVIDENCES. THE RELEVANT COMMENT S OF THE ASSESSING OFFICER MADE IN THE REMAND REPORT ARE REPRODUCED AS UNDER: REGARDING ACCEPTANCE OF ADDITIONAL EVIDENCE APPLICATION UNDER RULE 46A FILED NOW BY THE ASSESSEE COMPANY BEFORE YOUR GOODSELF, IT IS SUBMITTED THAT THE ASSESSEE HAS NEITHER PRODUCED ANY ADDITIONAL EVIDENCE NOR HAS MENTIONED ANY REASON ABOUT NON - SUBMISSION OF THIS ADDITIONAL EVIDENCE DURING THE COURSE OF ASSESSMENT PROCEEDING. MOREOVER THE ASSESSEE AL SO DOES NOT FULFILL ANY OF THE CONDITION GIVEN UNDER PROVISION OF RULE 46A(1)(A),(B),(C) AND (D) UNDER THE CIRCUMSTANCES THE ADDITIONAL EVIDENCES MAY NOT BE ACCEPTED. IN CASE THE LD. CIT(A) STILL CONSIDERS THAT THE ADDITIONAL EVIDENCES NEED TO BE ADMITTE D. IT IS RESPECTFULLY SUBMITTING TO APPRECIATE THAT WITHOUT IN DEPTH INQUIRY/INVESTIGATION WHICH WILL TAKE LOT OF TIME., THE AVERMENTS MADE BY THE ASSESSEE CANNOT BE ACCEPTED JUST ON THE BASIS OF CERTAIN EVIDENCES BEING PRODUCED BY THE ASSESSEE DURING THE APPELLATE PROCEEDINGS. THE INFORMATION/DOCUMENT CANNOT BE ACCEPTED AT THIS STAGE AS I AM NOT IN FAVOUR OF ACCEPTING THE ADDITIONAL EVIDENCES UNDER RULE 46A OF THE I.T. RULE AS REPORTED ABOVE. SUBMITTED FOR KIND CONSIDERATION. 35 13 .6 FURTHER , WE NOTE THAT THE LD. CIT - ( A ) INFERRED FROM THE COMMENT OF THE ASSESSING OFFICER THAT HE HAD NO RESERVATION AND THE GENUINENESS OF THE EXPLANATION GIVEN BY THE ASSESSEE. THE RELEVANT PART OF THE ORDER OF THE LD. CIT - ( A ) IS REPRODUCED AS UNDER: THE AO WAS CONFRONTED WITH THE ABOVE DETAILS IN THE REMAND PROCEEDINGS. THE AO MERELY STATED AS UNDER: - DURING THE YEAR CONSIDERATION THE ASSESSEE HAS BEEN MAINTAIN BANK ACCOUNT NO. 00111 0001203248 WITH HDFC BANK AND ALSO SAVING ACCOUNT NO.10132279635 WITH SBI SHAHADRA, DELHI. THE ASSESSEE HAS FAILED TO FURNISH THE COMPLETE DETAILS WITH EXPLANATION IN REGARD TO CREDIT ENTRIES APPEARING IN HER BANK ACCOUNT TOTALLING RS.4,17,35,528/ - . THEREFORE, IN THE CIRCUMSTANCES CREDIT ENTRIES APPEARING IN THE ACCOUNT OF THE A SSESSEE WERE HELD TO BE OUT OF UNDISCLOSED INCOME AND THE SAME WAS ADDED TO THE INCOME OF THE ASSESSEE. FROM THE ABOVE, IT IS INFERRED BY ME THAT THE AO HAD NO RESERVATIONS ON THE GENUINENESS OF THE EXPLANATIONS GIVEN BY THE APPELLANT IN THE PAPER BOOK I N REGARD TO THE CREDIT ENTRIES OF RS.4,17,35,528/ - 13 .7 I N OUR OPINION, THE LD. CIT - ( A ) HAS NOT COMPLIED WITH THE PROVISIONS OF RULE 46A(3) OF THE R ULES AND ACCEPTED THE GENUINENESS OF THE EXPLANATION OF THE ASSESSEE ON THE BASIS OF INFERENCE DRAWN ON THE SUBMISSION OF THE ASSESSING OFFICER IN THE REMAND REPORT. WE FIND THAT THE ASSESSING OFFICER CLEARLY ASKED FOR OPPORTUNITY TO EXAMINE THE ADDITIONAL EVIDENCES, WHICH THE LD. CIT - A DID NOT ALLOW TO THE ASSESSING OFFICER. 13 .8 WE ALSO NOTE THAT IN THE CASE OF SMT. SUDHA NAGAR (SUPRA), THE IDENTICAL ISSUES OF ADDITION FOR BANK ENTRIES AND DEEMED 36 DIVIDEND WERE INVOLVED AND ADDITION AL EVIDENCES WERE SUBMITTED BEFORE THE LD. CIT(A) IN VIOLATION OF RULE 46A OF THE INCOME TAX RULES. THE TRIBUNAL IN THE SAID CASE H AS RESTORED THE MATTER TO THE FILE OF THE ASSESSING OFFICER. THE RELEVANT PARAGRAPH OF THE ORDER OF THE TRIBUNAL IS REPRODUCED AS UNDER: 5.1 KEEPING IN VIEW OF THE FACTS AND CIRCUMSTANCES OF THE CASE AS EXPLAINED ABOVE, WE ARE OF THE CONSIDERED OPINION THAT THE ORDERS PASSED BY THE REVENUE AUTHORITIES ARE AGAINST THE PRINCIPLE OF NATURAL JUSTICE AND, THEREFORE, THE ISSUES INVOLVED IN THE A PPEALS FILED BY THE ASSESSEE DESERVE TO BE SET ASIDE TO THE FILE OF THE AO TO DECIDE THE SAME AFRESH, UNDER THE LAW, AFTER DETAILED ENQUIRY/INVESTIGATION/VERIFICATION OF THE EACH AND EVERY EVIDENCE INCLUDING THE ADDITIONAL EVIDENCE FILED U/R 46A BEFORE THE LD. CIT(A) AND PROVIDE ADEQUATE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. WE HOLD AND DIRECT ACCORDINGLY. THE ASSESSEE IS ALSO DIRECTED TO FULLY COOPERATE WITH THE AO IN THE PROCEEDINGS AND DID NOT TAKE ANY UNNECESSARY ADJOURNMENT AND ALSO PRODUCE ALL T HE DOCUMENTARY EVIDENCES BEFORE HIM TO SUBSTANTIATE ITS CASE. AS A RESULT, ALL THE 07 APPEALS FILED BY THE ASSESSEE STAND ALLOWED FOR STATISTICAL PURPOSES. 13 .9 THUS , RESPECTFULLY FOLLOWING THE DECISION OF THE HON BLE DELHI HIGH COURT I N THE CASE OF MAN ISH BUILDWELL P RIVATE L IMITED(SUPRA) AND THE DECISION OF TRIBUNAL IN THE CASE OF SMT. SUDHA NAGAR (SUPRA), WE FEEL IT APPROPRIATE TO RESTORE THE ISSUE TO THE FILE OF THE LD. CIT - ( A ) FOR COMPLYING THE PROVISIONS OF RULE 46 A (3) OF THE R ULES ON THE ISSUE OF F OLLOWING TWO ADDITIONS AND THEN DECIDE THE ISSUES IN ACCORDANCE WITH LAW. ( 1 ) ADDITION FOR CREDIT ENTRIES IN BANK ACCOUNTS ( 2 ) ADDITION FOR DEEMED DIVIDEND 37 14 . ACCORDINGLY, THE GROUND NOS. 1, 2 AND 3 OF THE APPEAL OF THE REVENUE AND GROUND NO. 4 OF THE APPEAL OF THE ASSESSEE, ARE AL L OWED FOR STATISTICAL PURPOSES. 15 . THE GROUND NO S . 5 & 6 OF THE APPEAL OF THE ASSESSEE WERE NOT PRESSED BEFORE US, ACCORDINGLY SAME ARE DISMISSED AS INFRUCTUOUS. 16 . THE GROUND NO. 7 OF THE APPEAL IS GENERAL IN NATURE AND THEREFORE , WE ARE NOT REQUIRED TO ADJUDICATE UPON AND ACCORDINGLY SAME IS DISMISSED AS INFRUCTUOUS. 17 . THUS, THE APPEAL OF THE ASSESSEE IS PARTLY ALLOWED FOR STATISTICAL PURPOSE S , WHERE AS THE APPEAL OF THE REVENUE IS ALLOWED FOR STATISTICAL PURPOSE S . ITA NO.5523, 5524 & 5525/DEL/2014 A ND ITA NOS. 5834, 5835 & 5836/DEL/2014 18 . THE PARTIES AGREED THAT ISSUES INVOLVED IN ITA NO S. 5523, 5524 & 5525/DEL/2014 FOR ASSESSMENT YEARS 2009 - 10 TO 2011 - 12 RESPECTIVELY ARE IDENTICAL TO THE GROUNDS RAISED IN ITA NO. 5522/ DEL/2014 FOR AY: 2008 - 09 AND THE ISSUE S INVOLVED IN ITA NOS. 5834, 5835 & 5836/DEL/2014 FOR ASSESSMENT YEARS 2009 - 10 TO 2011 - 12 RESPECTIVELY ARE IDENTICAL TO THE GROUNDS RAISED IN ITA NO. 5833/DEL/201 4 FOR ASSESSMENT YEAR 2008 - 09 , AND THUS DECISION IN THE CASE OF ITA NO. 5522/ DEL/2014 AND 58 33/DEL/2017 MIGHT BE APPLIED MUTAT IS MUTANDIS. 19 . ACCORDINGLY, WE APPLY TH E DECISION IN THE GROUNDS RAISED IN ITA NO . 5522 /DEL/2014 AND IN ITA NO . 583 3 /DEL/2014 FOR ASSESSMENT YEAR 2008 - 09 MUTA T IS MUT AN DIS IN THE APPEALS REFERRED ABOVE AND, ACCORDINGLY, THOSE APPEALS OF THE ASSESSEE ARE 38 ALLOWED PARTLY FOR STATISTICAL PURPOSE AND APPEAL S OF THE REVENUE ARE ALLOWED FOR STATISTICAL PURPOSES. 20 . IN THE RESULT, DECISION IN THE APPEALS OF THE ASSESSEE AND R EVENUE IS SUMMARIZED AS UNDER: SR. NO. ITA NO. (ASSESSEE/REVENUE ) ASSESSMENT YEAR RESULT 1. 5519, 5520 & 5521/DEL/2014 2005 - 06 TO 2007 - 08 PARTLY ALLOWED 2. 5522, 5523, 5524 & 5525/DEL/2014 2008 - 09 TO 2011 - 12 P ARTLY ALLOWED FOR STATISTICAL PURPOSES 3. 5830, 5831 & 5832/DEL/2014 2005 - 06 TO 2007 - 08 DISMISSED 4. 5833, 5834, 5835 & 5836/DEL/2014 2008 - 09 TO 2011 - 12 A LLOWED FOR STATISTICAL PURPOSE S. THE DECISION IS PRONOUN CED IN THE OPEN COURT ON 1 4 T H MARCH . , 201 8 . S D / - S D / - ( AMIT SHUKLA ) ( O.P. KANT ) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 1 4 T H MARCH , 201 8 . RK / - (D.T.D) COPY FORWARDED TO: 1 . APPELLANT 2 . RESPONDENT 3 . CIT 4 . CIT(A) 5 . DR ASST. REGISTRAR, ITAT, NEW DELHI