Sahebrao Govind Todmal, Ahmednagar V. ITO, Ward No.3, Ahmednagar

ITA 631/PUN/2013

• Counselvise Citation: [2015] 134 COUNSELVISE.COM (IT) 0847 (ITAT-PUNE)
• Duration Of Justice: 2 year(s) 8 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-11-2015
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Next Hearing Date: 07-09-2015
• Assessment Year: 2008-2009
• Appeal Filed On: 07-03-2013
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: S K RASTOGI; DHEERAJ KUMAR JAIN
• Keywords: Unexplained expenditure; Additional evidence; Cost of acquisition
• Section: 143(3); 142(1); 131

Judgement Text

] IQ.KS ] IQ.KS ] IQ.KS ] IQ.KS IQ.KS IQ.KSIQ.KS IQ.KS IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH A, PUNE . . , , ! ' BEFORE SHRI R.K. PANDA, AM AND SHRI VIKAS AWASTHY, JM . / ITA NO.631/PN/2013 !$ $ / ASSESSMENT YEAR : 2008-09 SHRI SAHEBRAO GOVIND TODMAL, A/P. RAHURI KHURD, TALUKA : RAHURI, DISTRICT : AHMEDNAGAR, PAN NO.AEKPT32551 . / APPELLANT V/S ITO, WARD-3, AHMEDNAGAR . / RESPONDENT / ASSESSEE BY : SMT. DEEPA KHARE / RESPONDENT BY : SHRI S.K. RASTOGI & SHRI DHEERAJ KUMAR JAIN / ORDER PER R.K. PANDA, AM : THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAINST THE O RDER DATED 06-12-2012 OF THE CIT(A)-I, PUNE RELATING TO ASSES SMENT YEAR 2008-09. 2. FACTS OF THE CASE, IN BRIEF, ARE THAT THE ASSESSEE IS AN INDIVIDUAL AND WAS SERVING IN MAHATMA PHULE KRISHI VIDYAPEETH (MPKV), RAHURI. INFORMATION WAS RECEIVED BY THE AO THAT THE ASS ESSEE HAD DEPOSITED AN AMOUNT OF RS.58,44,000/- IN THE OFFICE OF TAHSILDA R FOR OBTAINING RIGHTS TO EXCAVATE AND TRANSPORT SAND FROM TH E MULA RIVER / DATE OF HEARING :17.11.2015 / DATE OF PRONOUNCEMENT: 30.11.2015 2 ITA NO.631/PN/2013 BED AT DARADGAON, THADI, TALUKA RAHURI DURING THE YEAR UNDER CONSIDERATION FOR WHICH AN AMOUNT OF RS.44,04,000/- WAS PAID DURING THE YEAR AND SUCCEEDING YEAR. THE ASSESSEE WAS REMOVED FROM THE SERVICE FOR CONCEALING THIS INFORMATION FROM HIS EMPLOYER AND DISCIPLINARY PROCEEDINGS WERE INITIATED AGAINST HIM. SINCE THE ASSESSEE HAD NOT FILED ANY RETURN WITHIN THE TIME ALLOWED U/S.139(1) THE AO ISSUED A NOTICE U/S.148 DATED 15-09-2009. SINCE THE ASSESSEE DID NOT FILE ANY RETURN IN RESPONSE TO SUCH NO TICE U/S.148 THE AO ISSUED NOTICE U/S.142(1) WHICH WAS DULY SERVED ON THE ASSESSEE REQUIRING HIM TO FILE THE RETURN OF INCOME BY 16-1 1-2009. SINCE THERE WAS NO COMPLIANCE THE AO ISSUED ANOTHER NOT ICE WHICH WAS DULY SERVED ON THE ASSESSEE ON 15-05-2010 REQUIR ING HIM TO FILE THE RETURN BY 21-05-2010. THE ASSESSEE FINALLY FILED A RE TURN ON 03- 06-2010 DECLARING LOSS OF RS.11,000/-. 3. IN RESPONSE TO NOTICE U/S.143(2) AND 142(1) THE ASSESS EE APPEARED BEFORE THE AO AND FILED A DECLARATION BEFORE HIM O N 25-10-2007 ACCORDING TO WHICH 9 PEOPLE AND THE ASSESSEE HAD APPLIED FOR OBTAINING PERMISSION FOR EXCAVATION AND TRANSPORTATION OF SAND FROM MULA RIVER BED. A DECLARATION IN ORIGINAL EXECUTED ON A STAMP PAPER OF RS.100/- ON 25-10-2007 BEARING SEAL AND SIGNAT URE OF ADVOCATE SHRI R.B. PULATE OF RAHURI, NOTARY AND SIGNED BY THE ASSESSEE AND THE FOLLOWING 9 PERSONS WAS FILED : SL.NO. NAMES 1 SHRI BALASAHEB BABAB SHINDE 2 SHRI UTTAM BABAN SHINDE 3 SHRI RAMDAS MARUTI SHINDE 4 SHRI AAYUBBHAI AHMED SAYYED 5 SHRI VASANT RAOSAHEB KAKADE 6 SHRI RAJENDRA SADASHIV KAKADE 7 SHRI NANASAHEB RAOSAHEB GAGARE 8 SHRI ASHOK NAMDEO GAVANE AND 9 SHRI VIJAY KISAN AMBEKAR 3 ITA NO.631/PN/2013 4. AS PER THE SAID DECLARATION 9 PERSONS AND THE ASSES SEE HAD APPLIED FOR OBTAINING PERMISSION FOR EXCAVATION AND TRANSPOR TATION OF SAND FROM MULA RIVER BED. DESPITE REPEATED OPPORTUNITIES GRANTED BY THE AO THE ASSESSEE NEVER BOTHERED TO EITHER APPEAR PERSONALLY OR PRODUCE THE CONFIRMATION LETTERS FROM ALL THE 9 PERSONS CO NTAINING DETAILS OF PAYMENTS MADE TO HIM. FINALLY THE AO ISSUED NO TICE U/S.131 TO THE 9 PERSONS OUT OF WHICH THE FOLLOWING 7 PER SONS ATTENDED HIS OFFICE : SL.NO. NAMES 1 SHRI BALASAHEB BABAB SHINDE 2 SHRI UTTAM BABAN SHINDE 3 SHRI RAMDAS MARUTI SHINDE 4 SHRI VASANT RAOSAHEB KAKADE 5 SHRI RAJENDRA SADASHIV KAKADE 6 SHRI ASHOK NAMDEO GAVANE AND 7 SHRI VIJAY KISAN AMBEKAR THE AO RECORDED THEIR STATEMENTS WHO STATED THAT THE Y ARE ENGAGED IN AGRICULTURE. EXCEPT FOR THEIR IDENTITY PROOF, NONE OF THEM PR ODUCED ANY OF THE RECORDS/DOCUMENTS MENTIONED IN THE SUMMONS. THERE WAS NO RESPONSE ON THE PART OF SHRI AAYUBBHAI AHMED SA YYED TO THE SUMMONS. FURTHER, THE SUMMONS SENT TO SHRI NANASAHEB RAOSAHEB GAGRE WAS RETURNED UNSERVED WITH THE REMARK THE ADD RESSEE DOES NOT RESIDE AT THE GIVEN ADDRESS. FROM THE DECLARATION FURNISHED BY THE ASSESSE THE AO NOTED THAT THE SAME IS APPARENTLY SIGNED BY ONLY ONE PERSON. 5. THE ABOVE PERSONS FURTHER CONFESSED BEFORE THE AO T HAT ALTHOUGH THEY KNOW SHRI TODMAL, HOWEVER, THEY DID NOT CAR RY OUT ANY BUSINESS OF EXCAVATION OR TRANSPORTATION OF SAND FROM RIVE R BED OF MULA NOR DID THEY ADVANCE ANY MONEY TO SHRI TODMAL FOR H IS BUSINESS. THE AO SHOWED THEM THEIR SIGNATURES ON THE D ECLARATION 4 ITA NO.631/PN/2013 SUBMITTED BY THE ASSESSEE. THE ABOVE PERSONS ALSO SAID THAT THESE WERE NOT THEIR SIGNATURES. 6. THE STATEMENTS RECORDED FROM THE ABOVE 7 PERSONS WERE CONFRONTED TO THE ASSESSEE. IT WAS ALSO INFORMED BY THE AO THAT THE DECLARATION FILED BY HIM WAS A SPURIOUS ONE. THE ASSESSEE WAS GIVEN A FINAL OPPORTUNITY. SINCE THE ASSESSEE DID NOT AVAIL OF TH AT OPPORTUNITY AND THE ONUS CAST ON HIM TO PROVE TRUE AN D CORRECT FACT WAS NOT FULFILLED, THE AO MADE ADDITION OF RS.40,04,000/- BEING AMOUNT PAID FOR SAND MINING CONTRACT. 7. SIMILARLY, THE AO NOTED THAT THE ASSESSEE HAS DISCLOSED PURCHASE COST AT RS.3,04,000/- AND SALES MADE AT RS.3,20 ,000/-. THERE WAS NO CLOSING STOCK AND THE GROSS PROFIT WAS WOR KED OUT AT RS.15,200/-. FROM THE ABOVE GROSS PROFIT EXPENDITURE ON DIESEL, JCB HIRE CHARGES, LABOUR ETC. AMOUNTING TO RS.26,200/- WAS CLAIM ED AND THE ASSESSEE DECLARED NET LOSS OF RS.11,000/-. NO QUANT ITATIVE DETAILS WERE FURNISHED IN THE PROFIT AND LOSS ACCOUNT. NO BOOKS O F ACCOUNT OR OTHER DOCUMENTS ARE ALSO PRODUCED. IN ABSENCE OF ANY DETAILS TO SUPPORT THE CLAIM MADE IN THE ACCOUNTS THE AO DISALLOWED THE LOSS CLAIMED AND PROCEEDED TO DETERMINE THE INCOME FROM SAND TRADING BY HIS OWN CALCULATION. HE NOTED THAT THE VALUE OF CONTRACT WAS RS.39,99,000/- FOR 10500 BRASS. THE RATE PER BRASS WORK S OUT TO RS.380/- AND THE PREVAILING MARKET RATE PER BRASS WAS R S.1,500/-. THE COLLECTOR HAS IMPOSED FINE FOR ILLEGALLY EXCAVATING 400 BR ASS. THE HUGE DIFFERENCE BETWEEN THESE 2 APPARENTLY IS ON ACCOUN T OF COST OF TRANSPORT, LABOUR AND OTHER INCIDENTAL EXPENSES. APPLYING THESE 2 RATES TO THE PURCHASE/SALE COST THE AO HELD THAT THE SALE DISCLOSED AT RS.3,20,000/- CANNOT BE BELIEVED. APPLYING THE RATE OF RS.1 500/- PER BRASS FOR 800 BRASS THE AO DETERMINED THE SALES AT RS.1 2 LAKHS AND 5 ITA NO.631/PN/2013 DETERMINED THE GROSS PROFIT AT RS.8,96,000/-. AFTER ALLOWING THE ESTIMATED EXPENDITURE OF RS.5 LAKHS ON ACCOUNT OF VARIOUS EXPENSES THE AO DETERMINED THE NET PROFIT AT RS.3,96,000/- WHICH HE ADDED TO THE TOTAL INCOME OF THE ASSESSEE. 8. BEFORE CIT(A) IT WAS ARGUED THAT GRAVE INJUSTICE WAS BE ING PERPETRATED ON HIM AND HE WAS ONLY ACTING IN GOOD FAITH AT THE INSTANCE OF SOME PERSONS WHO HAD PROMISED HIM FINANCIAL HE LP IN CONDUCTING HIS DAUGHTERS MARRIAGE. THE LD.CIT(A) GAVE AN OPPORTUNITY TO THE ASSESSEE TO FURNISH THE NAMES OF PE RSONS ON WHOSE BEHALF HE WAS SUPPOSEDLY ACTING. HOWEVER, DESPITE GIVING 3 OPPORTUNITIES NEITHER ANY SUBMISSIONS WERE FILED NOR ANY DO CUMENTS WERE PROVIDED TO SUBSTANTIATE THE CASE OF THE ASSESSEE . ONLY AFFIDAVIT DATED 21-11-2012 NOTARISED IN AHMEDNAGAR WAS FILED WITH T HE THUMB IMPRESSION OF THE ASSESSEE STATING AS UNDER : I, SAHEBRAO TODMAL, AGE-56 YEARS, OCCUPATION - DRIVER, RESIDING AT A/P RAHURI, DIST -AHMEDNAGAR ON SOLEMN AFFIRMATION STAT E AND DECLARE AS UNDER- 1. I AM ASSESSED UNDER INCOME TAX ACT 1961 U/S. 143(3) FOR A. Y. 2008-09 AT INCOME OF RS 45,38,913/- WHICH INCLUDED ADDITION OF INCOME REPRESENTING UNEXPLAINED EXPENDITURE TOWARDS MAKING PAYMENT IN CONNECTION WITH CONTRACT OF SAND MINING IN AHMEDNAGAR. 2. DURING THE RELEVANT PERIOD I WAS AN EMPLOYEE OF MAHATMA PHULE KRISHI VIDYAPEETH, RAHURI. MY ONLY SOURCE OF INCOME WAS SALARY I HAD NO OTHER SOURCE OF INCOME UPTO THE SAID PERIOD. THERE WERE N O ASSETS, INVESTMENTS OR MONEY BELONGING TO ME. 3. DURING THE ASSESSMENT PROCEEDINGS, I HAVE STATED BEFORE THE ASSESSING OFFICER THAT THE PAYMENTS MADE FOR OBTAINING CONTRA CT FOR SAND MINING ARE MADE BY DIFFERENT PEOPLE. THE SAID PAYMENTS WHICH A RE TAXED IN MY HANDS, WAS NOT PAID BY ME AS I HAD NO MONEY OR ASSETS TO MAKE THE PAYMENT. 4. THE SAID PAYMENTS ARE THEREFORE CANNOT BE SAID T O HAVE MADE BY ME AS CONSIDERING MY BACKGROUND THERE WAS NO POSSIBILITY OF HAVING MONEY OF SUCH AMOUNT FOR MAKING PAYMENTS. THE ABOVE STATEMENT IS TRUE AND CORRECT TO THE BEST OF MY KNOWLEDGE AND BELIEF.' 6 ITA NO.631/PN/2013 9. HOWEVER, THE CIT(A) WAS NOT IMPRESSED BY THE SUBMISSION S MADE BEFORE HER AND CONFIRMED THE ADDITION MADE BY THE A O BY OBSERVING AS UNDER : 4.1. IT IS TO BE NOTED THAT, IN THE AFFIDAVIT DATE D 21/11/2012, FILED DURING APPELLATE PROCEEDINGS, THE APPELLANT HAS NOT D ENIED THE FACT THAT HE WAS THE PERSON WHO BID FOR THE MINING RIGHTS NOR TH E FACT THAT IT WAS HE WHO WAS AWARDED THE AFORESAID CONTRACT. IN FACT, THIS SIGNIFICANT FACT IS THE PROMINENT FEATURE IN THE AFFIDAVIT DT.21/11/2012 FI LED DURING APPELLATE PROCEEDINGS. FURTHER, THIS AFFIDAVIT IS A COMPLETE DEP ARTURE FROM THE DECLARATION DATED 25/10/2007, FILED BEFORE THE ASSESSIN G OFFICER. IN THE 2007 AFFIDAVIT, THE APPELLANT STATED ALONG WITH 9 OT HER PERSONS, THAT THE BID WAS TO BE MADE BY SHRI. SAHEBRAO GOVIND TODMAL ( THE APPELLANT) ON BEHALF OF ALL OF THEM AND THE EXPENSES FOR THE BID AN D PROFIT/LOSS WAS TO BE BORNE IN EQUAL PROPORTION. 4.2. DURING ASSESSMENT PROCEEDINGS, IN FACT, THIS DECLARA TION WAS PROVED TO BE A WRONG DECLARATION BY THE ASSESSING OFFICER, WHO SUMMONED ALL THE 9 PERSONS MENTIONED AS PARTNERS TO THE SAND-MINING BUSINE SS. SEVEN OUT OF THESE 9 PERSONS DEPOSED BEFORE THE ASSESSING OFFICER, STA TING THAT THEY WERE ACQUAINTED WITH THE APPELLANT AND THAT THEY WE RE AGRICULTURISTS, BUT CATEGORICALLY DENYING ANY CONNECTION WITH THE SAND M INING CONTRACT AWARDED TO THE APPELLANT. THEY DENIED HAVING GIVEN ANY MONEY TOWARDS OBTAINING THE GOVERNMENT CONTRACT AND IN FACT, DENI ED EVEN SIGNING THE DECLARATION. THE COPIES OF THEIR STATEMENTS RECORDED U /S 131 ARE ANNEXED TO AND FORM PART & PARCEL OF THE ASSESSMENT ORDER. AGAIN IT IS SIGNIFICANT T O NOTE THAT DECLARATION OF THE APPELLANT OF 2007 HAS C ONCLUSIVELY BEEN PROVED TO BE A WRONG STATEMENT AND THIS IS HIGHLIGHTED BY THE FACT THAT NEITHER DURING ASSESSMENT NOR APPELLATE PROCEEDINGS, THE APPELLANT HAS ASKED FOR AN OPPORTUNITY TO CROSS EXAMINE THESE 9 PERSO NS. THE APPELLANT HAS CLEARLY SOUGHT TO FILE ADDITIONAL EVIDENCE IN THE GUISE OF AFFIDAVIT DATED 20/11/2012, WHICH AS REPRODUCED IN PARA 4 SUPRA, DOES NOT NOW MENT ION THE NAMES OF THE PERSONS WHO HAVE ALLEGEDLY PAID THE M ONIES TOWARDS THE SAND CONTRACT BID. NO WRITTEN SUBMISSIONS ARE FILED SUBSTA NTIATING REASON WHY THE ADDITIONAL EVIDENCE IN THE FORM OF AFFIDAVI T SHOULD BE ADMITTED NOR WHETHER ANY OF THE CONDITIONS SPECIFIED UNDER RUL E 46A ARE SATISFIED. THE ASSESSMENT ORDER IS REPLETE WITH INSTANCES ABOUT OPPOR TUNITIES GRANTED TO THE APPELLANT TO SUBSTANTIATE HIS CLAIM DUR ING ASSESSMENT PROCEEDINGS FROM MAY 2010 TO DECEMBER 2010, WHEN THE ASSESSMENT WAS FINALLY COMPLETED. THE AFFIDAVIT FURTHER STATES TH AT APPELLANT'S ONLY SOURCE OF INCOME WAS SALARY. HOWEVER, THIS SALARY INCOM E HAS ALSO NOT BEEN SHOWN IN THE RETURN FILED BY THE APPELLANT ON 3 /6/2010, IN RESPONSE TO 148 NOTICE. 4.3. FURTHER, IN PARAS 18 & 19 OF THE ASSESSMENT ORDER, THE ASSESSING OFFICER HAS MENTIONED ABOUT INFORMATION RECEIVED FRO M AHMEDNAGAR COLLECTORATE REGARDING BREACH/VIOLATION OF THE TERM S OF THE SAND MINING CONTRACT AWARDED TO THE APPELLANT BY EXCAVATING 44 4 BRASS OF SAND MORE THAN THE CONTRACTED QUANTITY. CONSEQUENTLY, BY ORDER DATED 21/4/2008, THE COLLECTOR IMPOSED FINE OF RS.18,40,000 AND WHICH WAS AGAIN PAID BY THE APPELLANT IN CASH. CRIMINAL PROCEEDINGS WERE ALSO LAUNCHED AGAINST THE APPELLANT FOR ILLEGALLY LAYING DOWN ROAD OVER F OREST LAND AND EXCAVATING/TRANSPORTING SAND BY THIS ROUTE. THESE PRO CEEDINGS WERE 7 ITA NO.631/PN/2013 COMPOUNDED BY THE FOREST DEPARTMENT BY RECOVERING FI NE OF RS.1000 FROM THE APPELLANT ON 2/9/2008. ALL THESE FACTS RELA TING TO THE SUBSEQUENT ASSESSMENT YEAR CONCLUSIVELY PROVE THAT THE APP ELLANT HAS BEEN INDULGING IN SAND MINING BUSINESS. 4.4 THE APPELLANT HAS FAILED TO BRING ON RECORD ANY EVIDENCE TO CORROBORATE HIS TESTIMONY DATED 21/11/2012 THAT HE DI D NOT HAVE THE MONEY OR RESOURCES TO PAY FOR THE SAND MINING CONTRACT . IN CASE, THE CASH PAYMENTS WERE MADE BY SOME OTHER PERSONS, THE ONUS IS ON TO HIM TO PROVE THE IDENTITY OF THOSE PERSONS PARTICULARLY IN VI EW OF THE CLINCHING EVIDENCE THAT IT IS HE WHO SIGNED THE BID PAPERS AND I T IS HE WHO SIGNED THE BID PAPERS AND IT IS HE WHO WAS ACTUALLY AWARDED THE CONTRACT. THE ADDITIONAL EVIDENCE FILED DURING APPELLATE PROCEEDI NGS, THEREFORE DESERVES TO BE REJECTED IN THE ABSENCE OF ANY CORROBOR ATE MATERIAL TO THE CONTRARY. CONSEQUENTLY, GROUND NO. 1 IS DISMISSED. 10. SO FAR AS ADDITION OF RS.3,96,000/- BEING PROFIT FROM SAND MINING IS CONCERNED THE CIT(A) ALSO CONFIRMED THE SAME IN A BSENCE OF ANY EVIDENCE PRODUCED BEFORE HER TO PROVE TO THE CONTRARY. 11. AGGRIEVED WITH SUCH ORDER OF THE CIT(A) THE ASSESSEE IS IN APPEAL BEFORE US WITH THE FOLLOWING GROUNDS : 1. ON THE FACT AND IN THE CIRCUMSTANCES OF THE CASE, THE LD.CIT(A) PUNE ERRED IN CONFIRMING THE ADDITION OF RS.40,04,00 0/- ON ACCOUNTS OF UNEXPLAINED EXPENDITURE BY DISREGARDING THE SUBMISSION OF THE ASSESSEE. 2. ON THE FACT AND IN THE CIRCUMSTANCES OF THE CASE LD .CIT(A)-I, PUNE ERRED IN CONFIRMING AN ADDITION OF RS.3,96,000/- ON ACCOUNT OF ESTIMATED INCOME FROM SAND BUSINESS B Y DISREGARDING THE SUBMISSION O F THE ASSESSEE. 12. THE LD. COUNSEL FOR THE ASSESSEE FILED AFFIDAVITS OF THE FO LLOWING 3 PERSONS AS ADDITIONAL EVIDENCE WHEREIN THEY HAVE STATE D TO HAVE MADE THE FOLLOWING DEPOSITS TOWARDS THE SAND BUSINESS : 1. SHRI SHABIR NOOR MOHD. DESHMUKH RS.20 LAKHS 2. SHRI PARAJI YADAV GAYGAGE RS.2,25,000/- 3. SHRIRAJENDRA SHANKAR SANGALE RS.2,25,000/- WHILE THE FIRST AFFIDAVIT IS NOTARIZED ON 13-09-2011, THE OTH ER 2 AFFIDAVITS ARE NOTARIZED ON 24-02-2012. 8 ITA NO.631/PN/2013 13. REFERRING TO THE DECISION OF HONBLE KERALA HIGH COURT IN THE CASE OF SHRI P.K. NARAYANAN VS. CIT REPORTED IN 229 ITR 5 92 THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT IN CASE OF A BEN AMI TRANSACTION/BENAMI BUSINESS THE INCOME HAS TO BE ASSESS ED IN THE HANDS OF THE REAL BENEFICIARIES AND NOT IN THE HANDS OF THE BANAMIDA R. SHE SUBMITTED THAT IN THE INTEREST OF JUSTICE, THE MATTE R MAY BE RESTORED TO THE FILE OF THE AO OR THE CIT(A) AS THE BENCH DEEMS FIT SINCE THE AFFIDAVITS BEING FILED NOW GO TO THE ROOT OF THE MATTER. 14. THE LD. DEPARTMENTAL REPRESENTATIVE ON THE OTHER HA ND HEAVILY RELIED ON THE ORDER OF THE CIT(A). HE SUBMITTED THAT THOS E AFFIDAVITS ARE PRIOR TO THE ORDER PASSED BY THE CIT(A). THE ASSES SEE HAS NOT BROUGHT ANY MATERIAL ON RECORD TO SHOW AS WHAT PREVEN TED HIM FROM FURNISHING THESE AFFIDAVITS BEFORE THE CIT(A). HE SUBMITTED T HAT THE ASSESSEE BY PRODUCING THESE AFFIDAVITS IS TRYING TO CREATE A NEW STORY WHICH BY NO STRETCH OF IMAGINATION CAN BE BELIEVED AS TRUE . HE SUBMITTED THAT THE CONTRACT HAS BEEN AWARDED IN THE N AME OF THE ASSESSEE. THE ASSESSEE IS NOT AN ILLITERATE PERSON. THE ASSESSEE WAS FULLY AWARE AT THE TIME OF BIDDING FOR THE CONTRACT THAT HE IS PAYING FOR THE SAME. SINCE THE MONEY HAS BEEN DEPOSITED BY THE A SSESSEE IN HIS PERSONAL NAME AND THE ASSESSEE IS UNABLE TO SUBSTANTIAT E THE SOURCE OF THE SAME, THEREFORE, UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE, THE ADDITION MADE BY THE AO AND SUSTAINED BY THE CIT(A) SHOULD BE UPHELD. 15. WE HAVE CONSIDERED THE RIVAL ARGUMENTS MADE BY BOTH THE SIDES, PERUSED THE ORDERS OF THE AO AND CIT(A) AND THE P APER BOOK FILED ON BEHALF OF THE ASSESSEE. WE HAVE ALSO CONSIDERED TH E VARIOUS DECISIONS CITED BEFORE US. WE FIND IN THE INSTANT CASE THE AO OBTAINED INFORMATION FROM THE OFFICE OF TAHSILDAR THAT THE ASSESSEE HA S MADE 9 ITA NO.631/PN/2013 DEPOSIT OF RS.40,04,000/- FOR OBTAINING RIGHTS TO EXCAVATE AND TRANSPORT SAND FROM MULA RIVER BED AT DARADGAON, TALUKA RAHURI DURING THE YEAR UNDER CONSIDERATION. ON BEING ASKED BY THE AO TO SUBSTANTIATE THE SOURCE OF SUCH DEPOSIT THE ASSESSEE H AS FILED THE LIST OF 9 PERSONS WHO ACCORDING TO HIM HAD JOINTLY BIDDED WITH HIM FOR OBTAINING THE SAND CONTRACT. SINCE THE ASSESSEE WAS UN ABLE TO SUBSTANTIATE THE SOURCE OF INVESTMENT BY THE 9 PERSONS THE AO ISSUED SUMMONS TO THE ABOVE PERSONS OUT OF WHICH 7 PERSONS A PPEARED BEFORE THE AO AND HAVE CATEGORICALLY STATED THAT THEY HAVE NOT CARRIED OUT ANY BUSINESS OF EXCAVATION AND TRANSPORTATION OF SAN D FROM RIVER BED OF MULA NOR DID THEY ADVANCE ANY MONEY TO SHRI TODM AL FOR THE SAND BUSINESS. EVEN THE PERSONS HAVE DENIED THE FACT T HAT THE SIGNATURES ON THE DECLARATION FILED BY THE ASSESSEE WERE THEIRS. FURTHER, ONE SUMMON WAS RETURNED UNSERVED AND THERE WAS NO RESPONSE IN CASE OF ONE PARTY. ALTHOUGH THE AO GAVE SU FFICIENT OPPORTUNITY TO THE ASSESSEE TO SUBSTANTIATE THE SOUR CE OF DEPOSIT BY CONFRONTING THE STATEMENTS RECORDED FROM THE 7 PERSONS WE FIND THE ASSESSEE FAILED TO SUBSTANTIATE THE SAME. WE FIND DESPITE REPEATED OPPORTUNITIES GIVEN BY THE CIT(A) THE ASSESSEE ALSO COULD NOT FURNISH THE NAMES OF THE PERSONS ON WHOSE BEHEST HE WAS SUPP OSEDLY ACTING. SO FAR AS THE 3 AFFIDAVITS FILED BEFORE US ARE CONCERNED WE FIND THE AFFIDAVIT OF SHRI SHABIR NOOR MOHD. DESHMUKH WAS SIGNED ON 10-09-2011 AND NOTARIZED ON 13-09-2011. SIMILARLY THE A FFIDAVITS OF SHRI PARAJI YADAV GAYGAGE AND SHRI RAJENDRA SHANKAR SA NGALE ARE BOTH DATED 24-02-2012. EVEN THOUGH THE ABOVE AFFIDAVITS WERE AVAILABLE BEFORE THE ASSESSEE THEY WERE NEVER PRODUCED BEFORE THE CIT(A) WHO PASSED THE ORDER ON 06-12-2012. THE ABOVE EVENTS SHOW THAT THE ASSESSEE IS EITHER SUPPRESSING THE FACTS OR TR YING TO CREATE A NEW STORY BY PRODUCING THESE AFFIDAVITS. THERE IS NO JUST IFIABLE REASON 10 ITA NO.631/PN/2013 AS TO WHY THESE DOCUMENTS WERE NOT PRODUCED BEFORE T HE CIT(A) WHEN THE MATTER WAS BEING HEARD AND THE CIT(A) HAD GIVEN SU FFICIENT OPPORTUNITIES TO ATLEAST NAME THE PERSONS ON WHOSE BE HALF AND ON WHOSE BEHEST THE ASSESSEE WAS WORKING. NO OTHER MATE RIAL HAS BEEN PRODUCED BEFORE US TO SUBSTANTIATE THE SOURCE OF DEPOS IT OF RS.40,04,000/-. THE SUBMISSION OF THE LD. COUNSEL FOR THE AS SESESEE THAT THE ASSESSEE IS A MAN OF LOW MEANS AND DOES NOT H AVE THE CAPACITY TO INVEST SUCH HUGE AMOUNT DOES NOT HOLD GOOD ESPECIALLY WHEN THE ASSESSEE HIMSELF HAS DEPOSITED THE MONEY IN HIS OWN NAME AND HE IS NOT AN ILLITERATE PERSON. HE HAD SIGNED IN ENGLISH WHICH IS APPARENT FROM PAGE 3 OF THE PAPER BOOK WHEREIN HE HAS MADE AN APPLICATION TO THE BRANCH MANAGER, BANK OF MAHARASHTRA T O PROVIDE INFORMATION IN RESPECT OF 2 DEMAND DRAFTS OF RS.70,000/- AND RS.3,50,000/- RESPECTIVELY. FURTHER, HE WAS WORKING WITH M AHATMA PHULE KRISHI VIDYAPEETH AND HE WAS FULLY AWARE OF THE CON SEQUENCES. THE DECISION RELIED ON BY THE LD. COUNSEL FOR THE ASSESSEE IS NOT APPLICABLE TO THE FACTS OF THE PRESENT CASE AND THE SAME IS DISTINGUISHABLE. IN VIEW OF THE ABOVE DISCUSSION WE DO NOT FIND ANY FORCE IN THE SUBMISSION OF THE LD. COUNSEL FOR THE ASSESSEE THAT THE MATTER SHOULD BE RESTORED TO THE FILE OF THE AO FOR FRESH ADJUDICATION. WE ACCORDINGLY UPHOLD THE ORDER OF THE CIT(A) ON THE ISS UE OF ADDITION OF RS.40,04,000/-. 16. SO FAR AS THE SECOND GROUND IS CONCERNED, I.E. ADDITION OF RS.3,96,000/- ON ACCOUNT OF ESTIMATED INCOME FROM SAND BUS INESS, WE FIND THE AO AFTER DEDUCTING EXPENDITURE OF RS.5 LAKHS ON ESTIMATE BASIS FROM THE GROSS PROFIT ON RS.8,96,000/- MADE ADDITION OF RS.3,96,000/- ON ESTIMATE BASIS. THIS IN OUR OPINION APPEAR S ON THE HIGHER SIDE. CONSIDERING THE TOTALITY OF THE FACTS OF THE C ASE, WE ARE OF 11 ITA NO.631/PN/2013 THE CONSIDERED OPINION THAT NET PROFIT FROM SAND BUSINESS AT RS.1,50,000/- UNDER THE FACTS AND CIRCUMSTANCES OF THE CA SE IS REASONABLE. WE HOLD AND DIRECT ACCORDINGLY. GROUND OF AP PEAL NO.2 BY THE ASSESSEE IS ACCORDINGLY PARTLY ALLOWED. 17. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS PARTLY ALLOWED. PRONOUNCED IN THE OPEN COURT ON 30-11-2015. SD/- SD/- ( VIKAS AWASTHY ) ( R.K. PANDA ) JUDICIAL MEMBER ACCOUNTANT MEMBER IQ.KS PUNE ; # DATED : 30 TH NOVEMBER, 2015. LRH'K ' (!* + / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT 3. CIT ( A ) CENTRAL, PUNE 4. 5. 6. CIT CENTRAL, PUNE ' *, *, IQ.KS / DR, ITAT, A PUNE; / GUARD FILE. / BY ORDER , ' //TRUE COPY// / * / SR. PRIVATE SECRETARY *, IQ.KS / ITAT, PUNE