ACIT CEN CIR 32, MUMBAI V. PRAKASH B BHANDARKAR, MUMBAI

ITA 6671/MUM/2012

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 2883 (ITAT-MUMBAI)
• Duration Of Justice: 3 year(s) 7 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-06-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Next Hearing Date: 18-11-2015
• Assessment Year: 2008-2009
• Appeal Filed On: 02-11-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: C W ANGOLKAR
• Keywords: Unexplained investment; Income from undisclosed sources; Search and seizure; Loose papers; Document seized; Peak credit; Bonafide belief; Source of fund; Question of law; Corroborative evidences; Block assessment; Right to appeal; Retraction; Documents seized; Bonafide mistake
• Section: 143(3); 133A; 131; 68; 132

Judgement Text

, , ,, , IN THE INCOME TAX APPELLATE TRIBUNAL C, BENC H MUMBAI BEFORE SHRI SANJAY GARG, JUDICIAL MEMBER & SHRI RAJESH KUMAR, ACCOUNTANT MEMBER ./ ITA NO.7089/MUM/2011 ( / ASSESSMENT YEAR :2008-09) SHRI PANDOO P. NAIG, 96-98, MINT ROAD, MUMBAI - 400001 VS. ACIT, CC-32, MUMBAI- 400020 ./ ./PAN/GIR NO. : ACNPN 2800 J ( /APPELLANT ) .. ( / RESPONDENT ) AND ./ ITA NO.7364/MUM/2011 ( / ASSESSMENT YEAR :2008-09) ACIT, CC-32, MUMBAI- 400020 VS. SHRI PANDOO P. NAIG, 96-98, MINT ROAD, MUMBAI-400001 ./ ./PAN/GIR NO. : ACNPN 2800 J ( /APPELLANT ) .. ( / RESPONDENT ) AND ./ ITA NO.6671/MUM/2012 ( / ASSESSMENT YEAR :2008-09) ACIT, CC-32, MUMBAI- 400020 VS. PRAKASH B. BANDARKAR, ROOM NO.1, BABURAO CHAWL, HANUMAN TAKADI, BHANDUP (W), MUMBAI- 400078 ./ ./PAN/GIR NO. : AHLPB 1306 N ( /APPELLANT ) .. ( / RESPONDENT ) AND ./ ITA NO. 6672/MUM/2012 ( / ASSESSMENT YEAR :2008-09) ACIT, CC-32, MUMBAI- 400020 VS. PRAVIN B. BANDARKAR, ROOM NO.1, BABURAO CHAWL, HANUMAN TAKADI, BHANDUP (W), MUMBAI- 400078 ./ ./PAN/GIR NO. : AHLPB 1306 N ( /APPELLANT ) .. ( / RESPONDENT ) /ASSESSEE BY : SHRI VIJAY MEHTA /REVENUE BY : SHRI C.W.ANGOLKAR / DATE OF HEARING : 04/04/2016 /DATE OF PRONOUNCEMENT 24/06/2016 ITA NO.7089&7364/11 ITA NO.6671&6672/12 2 / O R D E R PER SANJAY GARG, JUDICIAL MEMBER : THE CROSS APPEALS BEARING ITA NO.7089 & 7364/MUM/20 11 HAVE BEEN FILED BY THE REVENUE AND ASSESSEE-PANDOO P. NA IG, WHEREAS, THE REVENUE HAS ALSO FILED TWO APPEALS I.E. ITA NOS.667 1 & 6672 IN CASES OF OTHER TWO DIFFERENT ASSESSEES I.E. SHRI PRAKASH B. BANDARKAR & SHRI PRAVIN B. BANDARKAR. 2. SINCE COMMON ISSUES ARE INVOLVED IN ALL THE APPE ALS, THEREFORE, ALL THE APPEALS HAVE BEEN HEAD TOGETHER AND ARE BEING DISPO SED OF BY THIS CONSOLIDATED ORDER. 3. LD. AR, AT THE OUTSET, HAS SUBMITTED THAT THOUGH SURVEY ACTION WAS CARRIED IN THE CASE OF ALL THE ABOVE NAMED THREE A SSESSEE, HOWEVER, ADDITIONS ON SUBSTANTIVE BASIS HAD BEEN MADE BY THE AO IN THE CASE OF ASSESSEE SHRI PANDOO P. NAIG ONLY AND IN THE CASES OF OTHER TWO ASSESSEES I.E. SHRI PRAKASH B. BANDARKAR & PRAVIN B. BANDARKA R, ADDITIONS WERE MADE ON PROTECTIVE BASIS ONLY CONSIDERING THEM AS ACTING ON BEHALF OF ASSESSEE PANDOO P. NAIG, THEREFORE, THEY ARE ALSO COVERED UN DER THE SAME SEARCH ACTION; HENCE, THE FACTS AND CIRCUMSTANCES MENTIONE D IN ITA NO.7089/MUM/2011 IN CASE OF ASSESSEE SHRI PANDOO N AIG, BE CONSIDERED IN DECIDING ALL THE APPEALS. THE LD. DR HAS ALSO PL EADED NO OBJECTION FOR THE SAME. HENCE, THE FACTS, FOR THE SAKE OF CONVENI ENCE, HAVE BEEN TAKEN FROM ITA NO.7089/MUM/2011 IN CASE OF ASSESSEE SHRI PANDOO NAIG. ITA NO.7089&7364/11 ITA NO.6671&6672/12 3 4. THE FACTS OF THE CASE AS HAVE BEEN SUMMED BY THE ASSESSING OFFICER (HEREINAFTER REFERRED TO AS THE AO) IN THE ASSESSME NT ORDER DATED 28.12.10 PASSED UNDER SECTION 143(3) OF THE ACT ARE REPRODUC ED AS UNDER: 6. BRIEF FACTS OF THE CASE: (I) INFORMATION OF VARIOUS HIGH VALUE TRANSACTIONS WERE RECEIVED BY THE INVESTIGATION WING OF THE INCOME TAX DEPARTMENT FROM FIU- IND. THESE TRANSACTIONS WERE SHOWN IN THE SAVING BANK ACCOUNT OF SHRI PRAKASH B. BANDARKAR AND SHRI PRAVIN B. BAN DARKAR (BOTH THE BROTHER) HELD IN HDFC BANK, FORT BRANCH. THESE DEPOSITS AND PAYMENTS WERE/NOTICED OVER A SHORT PERIOD OF TWO MONTHS IN F.Y. 2007-08. (II) THE INQUIRIES MADE FROM BY THE SAID BANK ELICITED N O SATISFACTORY EXPLANATION FROM ACCOUNT HOLDERS ABOUT THE NATURE AND SOURCE OF USED DEPOSITS AND PURPOSE /DES TINATION OF THE PAYMENTS. (III) THE KYC FORMS FILED BY SHRI PRAKASH & PRAVIN BADARK AR FILLED BY THESE PERSONS INDICATED THAT THEY WERE MEN OF MEAGE R MEANS, WHOSE ANNUAL INCOME WAS BELOW RS. 1 LAC. (IV) REPORT OF FLU IND SUGGESTED THAT SHRI PRAKASH B.BAD ARKAR AND SHRI PRAVIN B. PANDARKAR WERE EMPLOYEES OF SHRI PANDOO NAIG WHO WAS INVESTING HIS FUNDS IN THE STOCK MARKET I N THE NAMES OF THESE PERSONS. (V) DISCREET INQUIRIES WERE CONDUCTED AND IT WAS NOTICED THA T SHRI PRAKASH & SHRI PRAVIN BADARKAR WERE LIVING IN A CHA WL IN BHANDUP LOCALITY THAT IS PREDOMINANTLY OCCUPIED ECONOMICALLY WEAKER SECTION OF SOCIETY. FURTHER, SHRI PRAKASH & PRAVIN WER E BROTHERS HAVING NO OSTENSIBLE SOURCE OF INCOME WHICH WOULD EXPLAIN THE LARGE TURNOVER IN THEIR BANK ACCOUNTS. (VI) IN LIGHT OF THESE FACTS AND CIRCUMSTANCES, SURVEY ACTION WAS CARRIED OUT IN THE BUSINESS PREMISES OF SHRI PANDOO P . NAIG AT 22, RAJA BAHADUR MANSION, BOMBAY SAMACHAR MARG, MUMBAI- 400023 ON 09.05.2008 SIMULTANEOUSLY, ONE MORE PREMIS E AT BARODA WAS ALSO COVERED. ITA NO.7089&7364/11 ITA NO.6671&6672/12 4 (VII) DURING THE SURVEY VARIOUS LOOSE PAPERS AND DOCUMENTS WERE FOUND AND IMPOUNDED U/S. 133A (I)(3). (VIII) DURING THE SURVEY STATEMENTS OF SHRI PANDOO P. NAIG AND HIS FATHER SHRI T.K. PRABHAKAR NAIG WHO WAS ALSO PRESENT , RECORDED U/S. 131. (IX) SHRI PANDOO NAIG HAS ADMITTED UNDISCLOSED INCOME OF RS. 4 CRORES FOR A.Y. 2008-09 IN HIS STATEMENT RECORDED ON 6TH JUNE 2008. (X) SHRI PRAKASH BANDARKAR AND SHRI PRAVIN BANDARKAR HA S OFFERED RS. 3,39,78,291 AND RS. 3,67,10,971/- RESPECTIVELY, THE PEAK MOUNT OF THEIR BANK BALANCE FOR TAXATION. 5. THEREAFTER THE ASSESSEE FILED THE RETURN OF INCO ME FOR THE ABOVE ASSESSMENT YEAR ON 31.08.08 AND OFFERED TO TAX INCO ME UNDER THE HEADS OF SALARY, HOUSE PROPERTY, CAPITAL GAINS AND INCOME FR OM OTHER SOURCES, DECLARING TOTAL INCOME OF RS.4,09,33,530/- WHICH IN CLUDED THE AMOUNT OF RS.4 CRORES DECLARED DURING THE SURVEY ACTION. THE RETURN WAS SELECTED FOR SCRUTINY ASSESSMENT UNDER SECTION 143(3) OF THE ACT . IN THE COURSE OF ASSESSMENT PROCEEDINGS, THE AO MADE ENQUIRIES RELAT ING TO THE LOOSE PAPERS FOUND DURING THE SURVEY ACTION. HOWEVER, THE ASSES SEE SHRI PANDOO P. NAIG DENIED THAT THOSE PAPERS BELONGED TO HIM. THE AO, H OWEVER, OBSERVED THAT THE LOOSE PAPERS FOUND DURING THE SURVEY ACTION WER E SUGGESTIVE OF A NUMBER OF TRANSACTIONS IN SHARES. SHARE TRANSACTIO NS HAPPEN TO BE THE MAIN ACTIVITY/SOURCE OF INCOME OF SHRI PANDOO P. NAIG. HE THEREFORE CONFRONTED SHRI PANDOO P. NAIG WITH THE SAID PAPERS AS WELL AS HIS STATEMENT MADE UNDER SECTION 131 DURING THE SURVEY ACTION. HOWEVE R, THE ASSESSEE SHRI PANDOO P. NAIG DID NOT OWN UP THE DOCUMENTS. HE, HOWEVER, OFFERED TO TAX THE AMOUNT OF RS.4 CRORES, OFFERED/DECLARED DURING THE SURVEY ACTION, IN THE RETURN OF INCOME. BUT, HE NEITHER DURING THE COURSE OF POST SURVEY PROCEEDINGS NOR DURING THE ASSESSMENT PROCEEDINGS F URNISHED ANY WORKING IN RELATION TO DECLARED INCOME OF RS.4 CRORE FOR TH E ASSESSMENT YEAR UNDER CONSIDERATION, EVEN THOUGH, THE WORKING OF THE SAME WAS SPECIFICALLY ASKED ITA NO.7089&7364/11 ITA NO.6671&6672/12 5 BY THE AO VIDE ORDER SHEET ENTRY DATED 01.09.2010. THE ASSESSEE WAS THEN QUESTIONED ON THIS ISSUE BY THE AO AND SEVERAL ENQU IRIES WERE MADE. THE ASSESSEE FILED REPLY IN RESPECT TO THE VARIOUS QUER IES RAISED BY THE AO WHEREIN HE SUBMITTED THAT THE IMPOUNDED PAPERS WERE NOT FOUND IN HIS CONTROL AND THAT THE PREMISES FROM WHICH THOSE PAPE RS WERE RECOVERED WERE NOT UNDER HIS CONTROL AS THE SAME WAS UNDER OCCUPAT ION OF M/S. SAI BROKING, WHICH WAS THE PROPRIETARY CONCERN OF HIS M OTHER SMT. ANANDHI P. NAIG AND THAT THE SAID FIRM HAD BEEN CARRYING ON B USINESS AS SHARE SUB BROKER AND THE ASSESSEE WAS WORKING AS MANAGER OF T HE SAID M/S. SAI BROKING. IT WAS HOWEVER SUBMITTED THAT THE SAID M/ S. SAI BROKING CEASED TO CARRY ON THIS BUSINESS OF SHARE BROKING A FEW YEARS BACK. IT WAS ALSO SUBMITTED THAT THERE WERE SEVERAL VISITORS IN THE P REMISES AND THE PAPERS IN QUESTION MIGHT BE LEFT BY ANY OF SUCH VISITOR AND T HAT THE SAME DID NOT BELONG TO THE ASSESSEE. THE ASSESSEE HAD NOT CARRI ED OUT ANY TRANSACTIONS AS MENTIONED IN THE SAID PAPER; THAT WHATEVER THE SHAR E TRANSACTIONS WERE DONE BY THE ASSESSEE THAT WERE FULLY DISCLOSED IN HIS AC COUNTS AND THE RESULTING CAPITAL GAINS WERE DULY OFFERED IN THE INCOME TAX R ETURNS. THAT NEITHER THERE WAS ANY HANDWRITING OF THE ASSESSEE OR HIS EMPLOYEE S ON THE SAID LOOSE PAPERS NOR THEY BORE ANY SIGNATURE OF THE ASSESSEE OR ANY OF THE EMPLOYEE OF THE ASSESSEE AND FURTHER THAT THE IMPOUNDED PAPERS WERE DUMB PAPERS WHICH DID NOT LEAD ANYONE TO A CONCLUSION TO ASCERT AIN THE PROFIT OR LOSS RESULTING FROM SUCH TRANSACTIONS OR ABOUT THE PERSO N TO WHOM SUCH PROFIT OR LOSS BELONGED. IT WAS ALSO EXPLAINED THAT THE PERS ONS NAMELY SHRI PRAKASH BANDARKAR AND SHRI PRAVIN BANDARKAR DID NOT HAVE AN Y RELATIONSHIP WITH SHRI PANDOO P. NAIG. FURTHER IN A QUERY PUT BY THE AO DURING THE STATEMENT RECORDED OF SHRI PANDOO P. NAIG THAT IF, THE ASSESS EE WAS NOT HAVING ANY RELATIONSHIP WITH THE SAID BROTHERS, THEN, WHY THE LAND LINE NUMBER OF THE ASSESSEES PREMISES WAS MENTIONED BY THEM WHILE OPE NING THE ACCOUNT IN THE HDFC BANK BRANCH AT FORT, MUMBAI; THE ASSESSEE IN HIS STATEMENT ITA NO.7089&7364/11 ITA NO.6671&6672/12 6 EXPLAINED THAT HE HAD NOT AUTHORIZED SHRI PRAKASH B ANDARKAR AND SHRI PRAVIN BANDARKAR TO GIVE THIS NUMBER TO THE BANK. HOWEVER, THEY WOULD HAVE GIVEN THE LAND LINE NUMBER OF M/S. SAI BROKING SINCE THE SAID PERSONS USED TO TRADE THROUGH THE SAID FIRM AND USED TO COM E TO THE OFFICE QUITE OFTEN AND USE THE COMPUTER TERMINALS AND SPEND SOME TIME IN THE OFFICE OF M/S. SAI BROKING. SINCE THEY WERE NOT HAVING ANY L AND LINE NUMBER OF THEIR OWN, THEY MIGHT HAVE GIVEN THE LAND LINE NUMBER OF THE SAI BROKING TO THE BANK. AFTER CONSIDERING THE STATEMENT OF THE ASSES SEE RECORDED UNDER SECTION 131 DURING THE SURVEY ACTION AND FURTHER DU RING POST SURVEY PROCEEDINGS AND THE REPLY GIVEN BY THE ASSESSEE TO THE VARIOUS QUERIES RAISED BY HIM, THE AO CONCLUDED THAT SINCE THE ASSE SSEE WAS PRESENT AT THE OFFICE PREMISES DURING THE SURVEY ACTION AND THAT T HE LOOSE PAPERS WERE FOUND FROM THE SAID PREMISES, THEREFORE, THE PREMIS ES WAS OWNED BY THE ASSESSEE AND THE LOOSE PAPERS BELONGED TO HIM. HE FURTHER OBSERVED THAT THE ASSESSEE HAD OWNED UP SOME OF THE PAPERS BUT ONE (A NNEXURE A1), WHICH THE ASSESSEE DID NOT OWN UP. HE, THEREFORE, RELYIN G UPON THE PROVISIONS OF SECTION 292C OF THE INCOME TAX ACT, HELD THAT THERE WAS A PRESUMPTION THAT THE SAID LOOSE PAPER BELONGED TO THE ASSESSEE AND T HE ENTRIES MADE THEREIN REPRESENTED THE UNACCOUNTED INCOME OF THE ASSESSEE. HE, AFTER GOING THROUGH THE TRANSACTIONS RECORDED IN THE SAID LOOSE PAPERS OBSERVED THAT THE PROFIT ARISING OUT FROM THE VARIOUS TRANSACTIONS WA S DONE AT RS.4,40,47,290/- AND THE TOTAL VALUE OF OWNERSHIP WAS RS.35,01,51,58 4/-. HE ACCORDINGLY ADDED THE SAID AMOUNTS OF PROFIT AND SHARES OWNERSH IP INTO THE INCOME OF THE ASSESSEE AS UNDISCLOSED PROFIT AND INVESTMENT. THE LD. AO A LSO HELD THAT SHRI PRAKASH BANDARKAR AND SHRI PRAVIN BANDARK AR WERE MEN OF NO MEANS AND IN FACT THEY WERE CARRYING ON THE SHARE T RANSACTION BUSINESS/INVESTMENT ON BEHALF OF THE ASSESSEE. HE ACCORDINGLY ALSO ADDED THE AMOUNTS ASSESSED/DECLARED AS UNDISCLOSED INCOM E OF THE SAID BROTHERS AS INCOME OF THE ASSESSEE SHRI PANDOO P. NAIG ON SU BSTANTIVE BASIS, BUT, ITA NO.7089&7364/11 ITA NO.6671&6672/12 7 ASSESSED THE SAME ON PROTECTIVE BASIS IN THE HANDS OF THE BANDARKAR BROTHERS. THE AO ACCORDINGLY ASSESSED A TOTAL INCOM E OF RS.42,48,68,140/- IN THE HANDS OF THE ASSESSEE SHRI PANDOO P. NAIG. HE, HOWEVER, SETOFF THE AMOUNT OF RS. 4 CRORES OFFERED BY THE ASSESSEE IN T HE RETURN OF INCOME AGAINST THE SAID ADDITIONS. BEING AGGRIEVED AGAINST THE SAID ADDITIONS, THE ASSESSEE SHRI PANDOO P. NAIG AS WELL AS THE BANDARK AR BROTHERS SHRI PRAKASH BANDARKAR AND SHRI PRAVIN BANDARKAR FILED T HEIR APPEALS BEFORE THE LD. CIT(A). 6. THE ASSESSEE SHRI PANDOO P. NAIG IN HIS APPEAL B EFORE THE LD. CIT(A) TOOK AN ADDITIONAL GROUND, PLEADING THAT TH E AMOUNT OF RS.4 CRORES OFFERED AS ADDITIONAL INCOME IN THE STATEMENT DURIN G SURVEY PROCEEDINGS WAS OFFERED UNDER PRESSURE, COERCION AND THREAT OF THE INCOME TAX AUTHORITIES; THAT APART FROM THE OTHER ADDITIONS MA DE BY THE AO, THE ADDITION OF RS.4 CRORE, THOUGH OFFERED BY THE ASSES SEE IN THE RETURN OF INCOME, BE ALSO DELETED. THE LD. CIT(A) ADMITTED T HE SAID ADDITIONAL GROUND OF THE ASSESSEE FOR ADJUDICATION. THE ASSESS EE SUBMITTED BEFORE HIM THAT IN HIS STATEMENT, THE ASSESSEE HAD STATED THAT THE SAID LOOSE PAPERS I.E. PAGE NO.35 & 36 DID NOT BELONG TO HIM, HOWEVER, SIN CE THE OFFICIALS OF THE DEPARTMENT HAD RAISED SO MANY QUERIES DURING THE SU RVEY AND POST SURVEY ACTION HENCE, CONSIDERING THAT THE EXPLANATION GIVE N BY THE ASSESSEE WOULD NOT MEET THE RIGOROUS REQUIREMENTS OF LAW AND TFURT HER WITH A VIEW TO BUY PEACE OF MIND AND TO AVOID ANY LITIGATION IN THIS R EGARD, HE HAD OFFERED A SUM OF RS.4 CRORE AS ADDITIONAL INCOME. THAT THE AS SESSEE HAD ACCORDINGLY DECLARED THE SAID ADDITIONAL INCOME OF RS.4 CRORE I N HIS RETURN OF INCOME AND AN ENTRY WAS ALSO MADE BY THE ASSESSEE IN HIS B OOKS OF ACCOUNTS. THE LD. CIT(A), HOWEVER, OBSERVED THAT THE ASSESSEE HA D NOT RAISED ANY QUESTION REGARDING THE SURRENDERED AMOUNT OF RS.4 C RORE DURING THE ASSESSMENT PROCEEDINGS BEFORE THE AO. HE FURTHER OB SERVED THAT SINCE THE ITA NO.7089&7364/11 ITA NO.6671&6672/12 8 LOOSE PAPERS WERE FOUND FROM THE PREMISES OF THE AS SESSEE AND HENCE AS PER THE PROVISIONS OF SECTION 292C OF THE INCOME TAX AC T, IT HAD TO BE PRESUMED THAT THE SAID PAPERS BELONGED TO THE ASSES SEE. EVEN THE ASSESSEE HAD ALSO OFFERED THE SAID AMOUNT IN THE RETURN OF I NCOME AND SINCE HAD NOT RAISED ANY OBJECTION IN THIS RESPECT DURING THE ASS ESSMENT PROCEEDINGS, HENCE, AT THE APPELLATE STAGE BEFORE HIM, SUCH A CL AIM OF THE ASSESSEE THAT THE SURRENDER WAS UNDER PRESSURE WAS NOT ACCEPTABLE . HE, THEREFORE, DISMISSED THE ABOVE ADDITIONAL GROUND TAKEN BY THE ASSESSEE. IN RESPECT TO ADDITIONS MADE BY THE AO ON THE BASIS OF THE LOOSE PAPER, HE OBSERVED THAT IN VIEW OF THE PRESUMPTION LAID UNDER SECTION 292C OF THE ACT, THE LOOSE PAPERS FOUND DURING THE SURVEY ACTION BELONGED TO T HE ASSESSEE AND THE CONTENTS OF THE SAID PAPERS WERE ALSO PRESUMED TO B E TRUE AND THAT THE SAID TRANSACTIONS THUS BELONGED TO THE ASSESSEE. HE OBSE RVED THAT THE ENTRIES MADE IN THE RELEVANT PAGE NO.36 WERE NOT REFLECTED IN THE BOOKS OF ACCOUNTS OF THE ASSESSEE. HE FURTHER OBSERVED THAT THE ENTR IES GIVEN IN THE SAID LOOSE PAPER WERE UNDER THREE HEADS, FIRSTLY THE AMOUNT OF RS.4,40,47,290/- WAS UNDER THE HEAD PROFITS, THE SECOND ENTRY OF THE A MOUNT OF RS.49710462/- WAS UNDER THE HEAD FUNDING AND THE THIRD TRANSACT ION OF RS.350151584/- WAS UNDER THE HEAD OWNERSHIP. HE OBSERVED THAT T HOUGH IT APPEARED THAT THE ASSESSEE HAD UTILIZED FUNDS OF RS.350151584/- A ND RS.49710462/- TO EARN THE PROFIT OF RS.4,40,47,290/-, BUT NO OTHER C ORROBORATIVE EVIDENCE OR UNEXPLAINED CASH OR OTHER ASSET WAS FOUND IN THE PO SSESSION OF THE ASSESSEE DURING THE COURSE OF SURVEY. HE, THEREFORE, HELD T HAT THIS FACT ESTABLISHED THAT THE ASSESSEE WAS NOT IN HIS POSSESSION OF ANY OTHER UNEXPLAINED ASSET EXCEPT THE PROFIT EARNED OF RS.4,40,47,290 FROM THE TRANSACTIONS NOTED IN THE LOOSE PAPER, OUT OF WHICH THE ASSESSEE, HIMSELF , HAD DECLARED RS.4 CRORE AS HIS ADDITIONAL INCOME IN HIS STATEMENT UNDER SEC TION 131 OF THE ACT RECORDED DURING/POST SURVEY ACTION. HE ACCORDINGL Y HELD THAT SINCE ASSESSEE HAD MADE THE TRANSACTIONS OF SALE AND PURC HASE OF SHARES OUTSIDE ITA NO.7089&7364/11 ITA NO.6671&6672/12 9 THE BOOKS OF ACCOUNTS, HENCE, THE PROFIT OF AMOUNT OF RS.4,40,47,290/- WAS THE UNDISCLOSED INCOME OF THE ASSESSEE. HE ACCORDI NGLY CONFIRMED THE ADDITION OF RS.4,40,47,290/- MADE BY THE AO AND DEL ETED THE BALANCE ADDITION MADE OF RS.350151584/-. HE ALSO OBSERVED THAT THE BANDARKAR BROTHERS WERE DOING THE BUSINESS OF PURCHASE AND SA LE OF SHARES ON COMMISSION BASIS AND THAT THE SHARE TRANSACTIONS CA RRIED OUT BY THE SAID BROTHERS DID NOT BELONG TO SHRI PANDOO P. NAIG. AL L THE ENTRIES IN THEIR BANK ACCOUNTS WERE MADE THROUGH CHEQUES AND NOT EVEN A S INGLE ENTRY WAS IN CASH. THAT THE ENTRIES BELONGED TO DIFFERENT CLIEN TS OF BANDARKAR BROTHERS, ON WHOSE BEHALF THEY WERE DOING THIS BUSINESS AND T HAT NOT A SINGLE ENTRY OR TRANSACTION BELONGED TO SHRI PANDOO P. NAIG. HE, T HEREFORE, HELD THAT THE DECISION OF THE AO BY MAKING THE ADDITION ON SUBSTA NTIVE BASIS IN THE HANDS OF SHRI PANDOO P. NAIG, MERELY ON PRESUMPTION THAT THEY WERE MEN OF NO MEANS AND USED THE TELEPHONE NUMBER AND COMPUTER TE RMINALS OF ASSESSEE, WAS NOT ENOUGH EVIDENCE TO PROVE THAT THE CREDIT EN TRIES IN THE BANK ACCOUNT OF SHRI PRAKASH BANDARKAR AND SHRI PRAVIN BANDARKAR BELONGED TO THE ASSESSEE. HE ACCORDINGLY DELETED THE ADDITIONS MAD E BY THE AO IN RESPECT OF THE INCOME ADDED ON PROTECTIVE BASIS IN THE HAND S OF BANDARKAR BROTHERS AND SUBSTANTIVELY MADE IN THE HANDS OF THE ASSESSEE . IN RESPECT OF APPEALS BY THE BANDARKAR BROTHERS AGAINST THE ADDITION MAD E ON PROTECTIVE BASIS BY THE AO, THE LD. CIT(A) CALLED A REMAND REPORT IN R ESPECT OF DETAILS AND EVIDENCES SUBMITTED BY THE SAID BANDARKAR BROTHERS EXPLAINING THE TRANSACTIONS OF BANK DEPOSITS IN THEIR BANK ACCOUNT . AFTER, CONSIDERING THE REMAND REPORT, THE LD. CIT(A) OBSERVED THAT NO TRAN SACTION WAS CARRIED OUT BY THE SAID BROTHERS IN THE NAME OF THE ASSESSEE SH RI PANDOO P. NAIG; THAT IT WAS ESTABLISHED FROM THE VARIOUS EVIDENCES PRODUCED DURING THE REMAND REPORT THAT THE SAID BANDARKAR BROTHERS WERE EARNIN G COMMISSION FROM SALE AND PURCHASE OF SHARES ON BEHALF OF THE INVESTORS; THAT M/S. HANUMAN ENTERPRISES AND M/S. VIVEK ENTERPRISES HAD TRANSFER RED THE SHARES TO THE D- ITA NO.7089&7364/11 ITA NO.6671&6672/12 10 MAT ACCOUNT OF THE SAID BANDARKAR BROTHERS; THAT TH OSE SHARES WERE SOLD BY THE BANDARKAR BROTHERS AND THE RECEIPTS WERE DEPOSI TED IN THEIR BANK ACCOUNT; THAT THE PROCEEDS WERE RECEIVED THROUGH CH EQUES; THAT LATER ON CHEQUES WERE ISSUED TO THE INVESTORS M/S. HANUMAN E NTERPRISES AND M/S. VIVEK ENTERPRISES BY BANDARKAR BROTHERS AFTER CHARG ING THEIR COMMON ON THE TRANSACTIONS. THE BANK ACCOUNT AND OTHER DETAI LS OF M/S. HANUMAN ENTERPRISES AND M/S. VIVEK ENTERPRISES WERE ALSO SU BMITTED TO THE AO FOR CONFIRMATION OF THE TRANSACTIONS. AFTER PERUSAL OF THE VARIOUS DOCUMENTS, IT WAS CONFIRMED THAT THE CHEQUES ISSUED BY THE SAID B ROTHERS WERE DULY DEBITED IN THEIR BANK ACCOUNT IN THE NAME OF M/S. H ANUMAN ENTERPRISES AND M/S. VIVEK ENTERPRISES, WHICH TRANSACTIONS WERE DUL Y CONFIRMED BY THE BANK ALSO. THE ENTRIES IN THE BANK ACCOUNT OF THE SAID BROTHERS WERE CORRELATED WITH THE BANK ACCOUNTS OF M/S. HANUMAN E NTERPRISES AND M/S. VIVEK ENTERPRISES AND THE SAME WERE FOUND CORRECT. THE LD. CIT(A) THEREFORE CONCLUDED THAT IT WAS ESTABLISHED THAT TH E AMOUNT DEPOSITED IN THE BANK ACCOUNTS OF THE BANDARKAR BROTHERS BELONGED TO M/S. HANUMAN ENTERPRISES AND M/S. VIVEK ENTERPRISES AND THEREFOR E, ADDITION, IF ANY, WAS TO BE MADE ON SUBSTANTIVE BASIS, THAT SHOULD HAVE B EEN IN THE HANDS OF M/S. HANUMAN ENTERPRISES AND M/S. VIVEK ENTERPRISES ONLY . WHATEVER THE COMMISSION WAS EARNED BY THE SAID BROTHERS, THAT WA S DULY DISCLOSED IN THEIR ACCOUNTS/RETURN OF INCOME. NO ENTRY OR CONNE CTION OF ASSESSEE SHRI PANDOO P. NAIG WAS ESTABLISHED WITH THE DEPOSITS IN THE ACCOUNTS OF THE BANDARKAR BROTHERS. HE ACCORDINGLY DELETED THE ADD ITIONS MADE ON PROTECTIVE BASIS IN THE HANDS OF THE BANDARKAR BROT HERS. 7. NOW AGGRIEVED BY THE ORDER OF THE LD. CIT(A), TH E ASSESSEE, SHRI PANDOO P. NAIG HAS COME IN APPEAL BEFORE US, AGITAT ING THE CONFIRMATION OF ADDITION TO THE EXTENT OF RS.4,40,47,290/-; WHERE AS, THE REVENUE HAS COME IN APPEAL AGAINST THE ACTION OF THE LD. CIT(A) IN D ELETING THE ADDITION OF ITA NO.7089&7364/11 ITA NO.6671&6672/12 11 RS.35,01,51,584/- MADE IN THE HANDS OF ASSESSEE SHR I PANDOO P. NAIG AS UNEXPLAINED INVESTMENT AND FURTHER AGAINST THE DELE TION OF ADDITIONS MADE OF RS.3,39,78,291/- AND RS.3,67,10,971/- RESPECTIVE LY ON ACCOUNT OF OFFER/DECLARATION MADE BY SHRI PRAKASH BANDARKAR AN D SHRI PRAVIN BANDARKAR ON PEAK CREDIT BASIS IN THEIR ACCOUNTS, B UT ADDED BY THE AO INTO THE INCOME OF THE ASSESSEE SHRI PANDOO P. NAIG ON S UBSTANTIVE BASIS. THE REVENUE HAS ALSO FILED APPEALS AGITATING THE ACTION OF THE LD. CIT(A) IN DELETING THE ADDITIONS MADE ON PROTECTIVE BASIS IN THE HANDS OF BANDARKAR BROTHERS NAMELY SHRI PRAKASH BANDARKAR AND SHRI PRA VIN BANDARKAR. 8. WE HAVE HEARD THE RIVAL CONTENTIONS AND HAVE ALS O GONE THROUGH THE RECORDS. 9. THE LD. A.R. OF THE ASSESSEE HAS BROUGHT OUR ATT ENTION TO PAGE 41 OF THE PAPER BOOK WHICH IS THE COPY OF THE SEIZED DOCU MENT ON THE BASIS OF WHICH THE IMPUGNED ADDITIONS HAD BEEN MADE BY THE A O. WE FIND THAT THE SAME IS A COMPUTER GENERATED/PRINTED DOCUMENT. THE LD. A.R. HAS STATED THAT A PERUSAL OF THE SAID DOCUMENT GIVES NO INFERE NCE THAT THE SAME IN ANY MANNER RELATES TO THE ASSESSEE SHRI PANDOO P. NAIG. HE HAS FURTHER STATED THAT NEITHER THERE IS ANY HANDWRITING OF THE ASSESS EE SHRI PANDOO P. NAIG ON THE SAID DOCUMENT NOR IT BEARS SIGNATURE OF SHRI PA NDOO P. NAIG OR ANY OF HIS EMPLOYEES. HE HAS FURTHER STRESSED THAT ALL TH E COMPUTERS ETC. WERE THOROUGHLY CHECKED/EXAMINED BY THE TAX AUTHORITIES. THAT THE DATA IN THE ALLEGED DOCUMENT DID NOT MATCH AT ALL WITH ANY OF T HE DATA/ ENTRIES/SOFT COPIES OF DOCUMENTS IN THE COMPUTERS AT THE PREMISE S IN QUESTION. EVEN NEITHER ANY SUCH TRANSACTIONS IN ANY OF THESE SCRIP TS NOR ANY NAME OF ANY PERSON, AS MAY BE DECIPHERED FROM THE SEIZED DOCUME NT, WAS FOUND ENTERED INTO ANY OF THE DETAILS/DATA IN THE COMPUTER SYSTEM S OF THE ASSESSEE. HE HAS FURTHER SUBMITTED THAT THE ASSESSEE SHRI PANDOO P. NAIG HAD NEITHER ANY CONCERN NOR RELATION WITH ANY OF THE PERSONS MENTIO NED IN THE SAID SEIZED ITA NO.7089&7364/11 ITA NO.6671&6672/12 12 DOCUMENT AND NOR ANY OF SUCH PERSONS NAMED THEREIN IS KNOWN TO THE ASSESSEE. HE HAS FURTHER SUBMITTED THAT NOW WITH T HE USE OF ADVANCED TECHNOLOGY, EVEN THE THIRD STAGE DELETED DATA ON TH E HARD DISKS OF THE COMPUTERS CAN BE RETRIEVED. THAT, IF, THE ASSESSEE SHRI PANDOO P. NAIG WOULD HAVE ANY RELATION WITH THE SAID DATA OR THE S AME HAD BEEN PREPARED USING THE COMPUTER SYSTEMS OF THE ASSESSEE, THE SAM E COULD HAVE BEEN VERY EASILY RETRIEVED BY THE REVENUE AUTHORITIES FROM TH E COMPUTERS OF THE ASSESSEE. HE HAS FURTHER INVITED OUR ATTENTION TO QUESTION NO.36 PUT DURING THE STATEMENT RECORDED OF SHRI PANDOO P. NAIG UNDER SECTION 131 DURING SURVEY ACTION ON 9/10.05.2008. IN THE SAID QUESTIO N NO.36, A MENTION HAS BEEN MADE ABOUT A CHEQUE PAYMENT OF RS.18188000/- O N 09.01.2008 TO ONE SHRI NIRMALBHAI REGARDING WHICH SHRI PANDOO P. NAIG HAD ANSWERED THAT NEITHER THE SAID PAPER BELONGED TO HIM NOR HE HAD A NY CONCERN WITH THE PERSONS/COMPANIES NAMED IN THE SAID DOCUMENT. THAT NEITHER HE NOR ANY OF THE COMPANIES IN WHICH HE WAS A DIRECTOR, HAD EVER MADE ANY PAYMENT OF RS.18188000/- BY CHEQUE TO SHRI NIRMALBHAI ON 09.01 .08. THE LD. A.R. HAS FURTHER INVITED OUR ATTENTION TO PAGE 87 OF THE PAPER BOOK WHICH IS THE COPY OF THE STATEMENT OF SHRI PANDOO P. NAIG RECORD ED ON JUNE, 6 TH 2008 DURING THE POST SURVEY ACTION. THE LD. A.R. HAS IN VITED OUR ATTENTION TO QUESTION NO.3 PUT TO SHRI PANDOO P. NAIG DURING THE SAID STATEMENT, WHEREIN, REFERENCE HAS BEEN MADE TO DIFFERENT PAPER S AND THE ASSESSEE HAS BEEN ASKED TO EXPLAIN REGARDING EACH SET OF PAPERS. A TABLE HAS BEEN PREPARED IN THIS REGARD AND A REFERENCE HAS BEEN MA DE REGARDING USD ACCOUNT NUMBER 01-4792424-01 IN THE NAME OF IMAGE S ECURITIES FZC WITH STANDARD CHARTERED BANK, DUBAI AND ACCOUNT NO.6101224 IN THE NAME OF M/S. CRIKWOOD CAPITAL INVESTMENT CORPORATION. THE A SSESSEE SPECIFICALLY DENIED ANY CONCERN OF HIS OR ANY OF HIS FAMILY MEMB ERS WITH REGARD TO PAGE 17 AND ACCOUNT NO.6101224 IN THE NAME OF M/S. CRIKW OOD CAPITAL INVESTMENT CORPORATION. THE ASSESSEE MADE A STATEM ENT THAT HE DID NOT ITA NO.7089&7364/11 ITA NO.6671&6672/12 13 KNOW THAT TO WHOM SAID ACCOUNTS BELONGED OR TO WHOM THE COMPANY M/S. CRIKWOOD CAPITAL INVESTMENT CORPORATION BELONGED. THE ASSESSEE ADMITTED THAT PAGE 46 REFERRED TO IN THE SAID QUERIES BELONG ED TO HIS FATHERS ACCOUNT, BUT THERE WERE NO INCRIMINATING EVIDENCE OR DETAILS ON THE SAID PAPER. THE ASSESSEE, HOWEVER, CATEGORICALLY DENIED HIS RELATI ON TO OTHER PAPERS AND HIS CONCERN OR RELATION WITH ANY OF THE NAMES OF PERSON S MENTIONED IN THE SAID DOCUMENTS. THE LD. A.R. IN THIS RESPECT, HAS STRES SED THAT THE DATA LIKE ACCOUNT NUMBER, THE NAME OF THE ACCOUNT HOLDERS, TH E REFERENCE OF CHEQUE PAYMENT ETC. WERE THE RECORDS WHICH COULD HAVE BEEN VERIFIED BY THE REVENUE AUTHORITIES AND IF THE ASSESSEE WOULD HAVE GOT ANY CONCERN, DEALING OR TRANSACTIONS WITH THE SAID ACCOUNTS OR W ITH THE PERSONS NAMED IN THE SAID DOCUMENTS, THE REVENUE COULD HAVE EASILY D ETECTED THE SAME. HOWEVER, DESPITE MAKING MUCH INVESTIGATIONS, THE RE VENUE COULD NOT ESTABLISH ANY LINK OF THE ASSESSEE WITH THE SAID BA NK ACCOUNTS OR WITH THE PERSONS OR THE COMPANIES NAMED IN THE SEIZED DOCUME NTS. THE LD. A.R. HAS ALSO INVITED OUR ATTENTION TO QUESTION NO.9 PUT TO ASSESSEE- SHRI PANDOO P. NAIG DURING THE SAID STATEMENT RECORDED ON JUNE, 6 TH , 2008 WHEREIN THE AO HAS REPEATEDLY BY USING DIFFERENT WORDINGS PUT T HE SAME QUERIES TO THE ASSESSEE SO AS TO EXTRACT SOME CONCERN OR RELATION OF THE ASSESSEE WITH THE SEIZED DOCUMENTS BUT COULD NOT SUCCEED IN THIS RESP ECT. EVEN WHEN THE ASSESSEE WAS ASKED TO GIVE THE DETAILS/COMPUTATION IN RELATION TO THE ADDITIONAL INCOME DECLARED OF RS.4 CRORE, THE ASSES SEE HAD CATEGORICALLY REPLIED THAT NEITHER ANY OF THE TRANSACTIONS BELONG ED TO HIM NOR HE HAD ANY CONCERN WITH THE SAID TRANSACTIONS. THE ADDITIONAL INCOME WAS JUST OFFERED BECAUSE OF THE CONSISTENT PRESSURE OF THE REVENUE A UTHORITIES DURING AS WELL POST SURVEY PROCEEDINGS. THE LD. AR HAS FURTHER IN VITED OUR ATTENTION TO THE FACT THAT AN UNDERTAKING HAD BEEN OBTAINED FROM THE ASSESSEE IN HIS STATEMENT THAT THE ADDITIONAL INCOME WOULD BE OFFER ED FOR TAXATION IN A.Y. 2008-09 AND THAT HE WOULD NOT CLAIM ANY EXPENDITURE IN RESPECT OF THIS ITA NO.7089&7364/11 ITA NO.6671&6672/12 14 ADDITIONAL INCOME OFFERED. IN THE END OF THE STATE MENT, IT HAS BEEN REQUESTED BY THE ASSESSEE THAT SUBJECT TO HIS DECLA RATION OF THE SAID INCOME, NO PENALTY OR PROSECUTION BE INITIATED AGAINST HIM OR ANY OF HIS FAMILY MEMBERS OR ASSOCIATE CONCERNS AND THAT HE HAS OFFER ED THE SAID INCOME IN BONAFIDE BELIEF THAT NO ADVERSE VIEW WILL BE TAKEN. THE LD. A.R. HAS FURTHER INVITED OUR ATTENTION TO THE RELEVANT OBSER VATIONS OF THE AO IN PARA 8(E) OF THE ASSESSMENT ORDER WHEREIN HE HAS OBSERV ED THAT SHRI PANDOO P. NAIG HAS NOT OWNED UP THE DOCUMENTS IMPOUNDED FROM THE PREMISES IN QUESTION AND FURTHER THAT THOUGH HE HAD QUANTIFIED AN UNDISCLOSED INCOME OF RS.4CRORES AND OFFERED THE SAME FOR TAX FOR A.Y. 20 08-09, HOWEVER, NEITHER DURING THE COURSE OF POST SURVEY PROCEEDINGS NOR DU RING THE ASSESSMENT PROCEEDINGS, SHRI PANDOO P. NAIG HAD SUBMITTED THE WORKING OF DISCLOSURE OF INCOME FOR A.Y. 2008-09 EVEN THOUGH WORKING OF T HE DISCLOSURE WAS SPECIFICALLY ASKED BY THE AO VIDE ORDER SHEET ENTRY DATED 01.09.10. HE HAS FURTHER CONTENDED THAT THE PRESUMPTION UNDER SECTIO N 292C WAS REBUTTABLE PRESUMPTION AND THAT AS PER THE VARIOUS CASE LAWS, ADDITION CANNOT BE MADE MERELY ON PRESUMPTION BASIS ALONE, BUT THERE SHOULD BE SOME CORROBORATIVE EVIDENCE FOR SUCH A PRESUMPTION. HE HAS FURTHER SU BMITTED THAT THE ALLEGED DOCUMENT ON THE BASIS OF WHICH THE PRESUMPTION AGAI NST THE ASSESSEE HAS BEEN DRAWN BY THE LOWER AUTHORITIES IS A DUMB DOCUM ENT AND IS NOT SUGGESTIVE OF ANY SUCH PRESUMPTION AGAINST THE ASSE SSEE. THE LD. A.R. HAS FURTHER INVITED OUR ATTENTION TO THE FINDINGS OF TH E LD. CIT(A) RECORDED AT PAGE 16 OF THE IMPUGNED ORDER THAT NO CORROBORATIVE EVIDENCE OR UNEXPLAINED CASH OR OTHER ASSET WAS FOUND IN THE PO SSESSION OF THE ASSESSEE DURING THE SURVEY. HE HAS FURTHER CONTENDED THAT T HE ADDITIONS IN THIS CASE HAVE BEEN MADE ONLY BECAUSE THE ASSESSEE HAD DECLAR ED ADDITIONAL INCOME OF RS.4 CRORE DURING SURVEY ACTION. HE HAS VEHEMEN TLY CONTENDED THAT THE ASSESSEE, IN FACT, WAS FORCED TO MAKE SUCH A DECLAR ATION AND THAT SUCH A DECLARATION WAS NOT VOLUNTARY. HE HAS INVITED OUR ATTENTION TO PAGE 33 OF ITA NO.7089&7364/11 ITA NO.6671&6672/12 15 THE PAPER BOOK WHICH IS THE COPY OF THE LETTER DATE D JULY, 16 TH , 2011 ADDRESSED TO CIT(A), MUMBAI WHEREIN, IT HAS BEEN EX PLAINED THAT THE ASSESSEE WAS TIME AND AGAIN ASKED QUESTIONS REGARDI NG THE SAID DUMB DOCUMENT AND THE ASSESSEE SHRI PANDOO P. NAIG ALWAY S DENIED THAT THE SAID DOCUMENT BELONGED TO HIM. IT HAS BEEN FURTHER SUBM ITTED THAT THE ADDITIONAL INCOME WAS GOT DECLARED UNDER COERCION, THREAT AND UNDUE INFLUENCE OF THE SURVEY PARTY. IN ORDER TO GET RID OF THE MENTAL TR AUMA AND LONG INTERROGATION, THE ASSESSEE MADE THE ABOVE STATED D ECLARATION WITHOUT REALIZING THE MEANING OR CONSEQUENCES THEREOF. IT HAS BEEN FURTHER SUBMITTED THAT THE STATEMENT MADE BY SHRI PANDOO P. NAIG AND THE CONSEQUENT TAX PAID WAS NOT VOLUNTARY BUT UNDER THR EAT AND DURESS. THAT THE ASSESSEE HAS BEEN MAINTAINING THE PROPER ACCOUNTS A ND THE INCOME EARNED FROM BUSINESS, CAPITAL GAINS AND OTHER SOURCES WAS DULY DECLARED ON YEAR TO YEAR BASIS IN THE RESPECTIVE RETURNS OF INCOME. TH E LD. A.R. HAS INVITED OUR ATTENTION TO THE FACT THAT EVEN IN HIS ACCOUNTS, TH E ASSESSEE MADE AN ENTRY ON 31.03.08 I.E. AT THE END OF THE YEAR, CREDITING HIS CAPITAL ACCOUNT WITH AN AMOUNT OF RS.4 CRORE ON ACCOUNT OF CASH INTRODUCED .HOWEVER, ON THE NEXT DAY I.E. 01.04.08 I.E. ON THE FIRST DAY OF THE NEXT FINANCIAL YEAR, HE REVERSED THE SAID ENTRY DUE TO THE FACT THAT THERE WAS NO SU CH CASH AVAILABLE WITH HIM. FURTHER, SINCE HE WAS ASKED TO MAKE THE PAYMENT OF TAXES ON SUCH ADDITIONAL INCOME DECLARED DURING SURVEY ACTION, HE MADE PAYMENT OF RS.15560030/- TOWARDS TAX BY EN-CASHING THE FIXED D EPOSITS WHICH WERE HELD BY HIM AND ALSO BY OBTAINING LOANS FROM OUTSID ERS. THE LD. A.R. HAS FURTHER SUBMITTED THAT THE ASSESSEE, BEING NOT VERY MUCH EDUCATED PERSON AND BEING FEARFUL OF ANY ADVERSE ACTION BY THE INCO ME TAX AUTHORITIES, COULD NOT GATHER COURAGE TO RETRACT FROM HIS STATEM ENT/PROMISE MADE TO THE INCOME TAX AUTHORITIES DURING SURVEY ACTION AND THE REFORE OFFERED THE ADDITIONAL INCOME AS PER THE STATEMENT GIVEN AND PA ID TAXES ALSO. HOWEVER, WHEN THE CASE OF THE ASSESSEE WAS SELECTED FOR SCRU TINY AND THE AO AGAIN ITA NO.7089&7364/11 ITA NO.6671&6672/12 16 MADE QUERIES IN THIS RESPECT AND EVEN MADE THE ADDI TIONS OF ALL THE FIGURES WHICH WERE WRITTEN ON THE SAID DUMB DOCUMENT, THE A SSESSEE THUS WAS LEFT WITH NO ALTERNATIVE, THEN TO CHALLENGE THE ILLEGAL ADDITIONS MADE BY THE AO AND GATHERED COURAGE TO BRING THE TRUE FACTS BEFORE THE FIRST APPELLATE AUTHORITY AND TOOK THE ADDITIONAL GROUND BEFORE HIM THAT THE INCOME DECLARED DURING SURVEY ACTION WAS UNDER THREAT AND COERCION. THAT THE SAID GROUND SINCE WAS ADMITTED BY THE LD. CIT(A) FOR ADJ UDICATION, BUT HAS BEEN DECIDED AGAINST THE ASSESSEE ON THE BASIS OF PRESUM PTION UNDER SECTION 292C OF THE INCOME TAX ACT. THE LD. A.R. OF THE AS SESSEE HAS SUBMITTED THAT THE FACTS ON THE FILE, ITSELF, SPEAK THAT NEIT HER ANY ASSET NOR ANY CASH WAS RECOVERED FROM THE PREMISES OR POSSESSION OF THE AS SESSEE NOR ANY SUCH EVIDENCE WAS FOUND WHICH MAY SHOW THAT THE ASSESSEE HAD EVER EARNED SUCH INCOME. THAT THE SAID DUMB DOCUMENT DID NOT BELONG TO ASSESSEE, BUT PERHAPS, TO SOME OTHER PERSON, WHO VISITED THE PREM ISES OF THE ASSESSEE AND INADVERTENTLY LEFT THE SAME THERE. THE LD. A.R. HA S FURTHER INVITED OUR ATTENTION TO THE WRITTEN SUBMISSIONS MADE BY THE AS SESSEE BEFORE THE LD. CIT(A) THAT IN SPITE OF EXPLAINING ABOUT ALL THE PA PERS WHICH WERE FOUND DURING THE SURVEY ACTION AND ALSO EXPLAINING ABOUT THE PAPERS WHICH THE ASSESSEE SPECIFICALLY CLAIMED THAT THEY DID NOT BEL ONG TO HIM; THE ASSESSEE WAS, NOT ONLY DURING SURVEY ACTION BUT ALSO ON EACH SUBSEQUENT OCCASIONS, THREATENED WITH THAT HUGE ADDITION AND THAT PENALTI ES WOULD BE LEVIED AGAINST HIM; THAT UNDER THIS FEAR, COERCION, THREAT S AND TO GET RID OF THE MENTAL TRAUMA AND INTERROGATION, THE ASSESSEE WAS L EFT WITH NO CHOICE BUT TO OFFER THE SAID INCOME FOR TAX. THE ASSESSEE JUST D ECLARED THE SAID RS.4 CRORES IN HIS RETURN OF INCOME AS ADDITIONAL INCOME AS PROMISED DURING THE SURVEY ACTION BUT SINCE THE ASSESSEE WAS NOT HAVING ANY SUCH INCOME FROM ANY SOURCE, HENCE NO SOURCE OF SUCH INCOME WAS EXPL AINED IN THE RETURN OF INCOME. THE AO TIME AND AGAIN ASKED FOR THE WORKIN G OF THE INCOME BUT SINCE THERE WAS NO WORKING AND IT WAS ONLY DECLARAT ION UNDER THREAT, HENCE ITA NO.7089&7364/11 ITA NO.6671&6672/12 17 NO WORKING WAS FILED WITH THE AO. EVEN THE AO HAS ALSO NOT CORRELATED THE SAID ADDITIONAL INCOME UNDER ANY SOURCE OF INCOME B UT HAS GIVEN THE CREDIT OF THE SAME AGAINST THE ADDITIONS MADE ON THE BASIS OF DUMB DOCUMENT. THE LD. A.R. HAS FURTHER SUBMITTED THAT EVEN IN THE CASE OF BANDARKAR BROTHERS, SUCH AN ADDITIONAL INCOME WAS GOT DECLARE D UNDER THREAT AND COERCION ON THE BASIS OF PEAK CREDITS IN THEIR BANK ACCOUNTS. HOWEVER, THE BANDARKAR BROTHERS, BEFORE THE CIT(A) AND IN THE RE MAND PROCEEDINGS, EXPLAINED THE RELEVANT CREDIT ENTRY IN THEIR BANK A CCOUNT AND IT WAS FOUND THAT THE BANK ENTRIES WERE DULY EXPLAINED AND EACH OF THE AMOUNT WAS CREDITED OR PAID THROUGH CHEQUE ONLY. IN VIEW OF T HIS, THE ADDITIONS IN CASE OF BANDARKAR BROTHERS ON THE BASIS OF REMAND REPORT OF THE AO HAVE BEEN DELETED BY THE CIT(A) AND THAT, ITSELF, PROVES THAT THE DECLARATION/ SURRENDER NOT ONLY FROM THE ASSESSEE BUT ALSO FROM THE BANDAR KAR BROTHERS WAS OBTAINED BY THE REVENUE AUTHORITIES UNDER THREAT AN D COERCION. THE LD. A.R., THEREFORE, HAS SUBMITTED THAT THE ADDITIONS M ADE BY THE AO ON ACCOUNT OF THE SEIZED DOCUMENT WERE LIABLE TO BE SE T ASIDE. 10. THE LD. D.R., ON THE OTHER HAND, HAS SUBMITTED THAT SINCE THE ASSESSEE HIMSELF HAD OFFERED FOR TAXATION THE ADDITIONAL INC OME OF RS.4 CRORE, HENCE AT THIS STAGE, THE ASSESSEE IS ESTOPPED FROM HIS AC T AND CONDUCT TO AGITATE THE TAXATION OF THE SAID INCOME OF RS. 4 CRORES. HE HA S FURTHER SUBMITTED THAT THE STATEMENT OF SHRI PANDOO P. NAIG WAS RECORDED U NDER SECTION 131 OF THE ACT AND THAT NO PRESSURE AS ALLEGED BY SHRI PANDOO P. NAIG WAS EVER EXERTED UPON HIM. HE HAS FURTHER SUBMITTED THAT TH E AO HAD MADE THE ADDITION ON THE BASIS OF INCRIMINATING DOCUMENT UND ER THE PROVISIONS OF SECTION 68 OF THE ACT ON ACCOUNT OF UNEXPLAINED INC OME/INVESTMENT. HE HAS FURTHER SUBMITTED THAT THE BANDARKAR BROTHERS W ERE MEN OF NO MEANS AND THAT THE INVESTMENTS MADE BY THEM WERE ON BEHAL F OF THE ASSESSEE AND EVEN THE PHONE NUMBER OF THE ASSESSEES PREMISES WA S GIVEN BY THEM TO THE ITA NO.7089&7364/11 ITA NO.6671&6672/12 18 BANK WHILE OPENING BANK ACCOUNT. HE HAS FURTHER SU BMITTED THAT IN VIEW OF THE PROVISIONS OF SECTION 292C, THE ADDITIONS ON TH E BASIS OF THE DOCUMENT FOUND FROM THE PREMISES OF THE ASSESSEE HAVE RIGHTL Y BEEN MADE BY THE AO. HE HAS FURTHER SUBMITTED THAT THERE IS NO EVIDENCE ON THE FILE THAT ANY THREAT, PRESSURE OR COERCION WAS EXERTED BY THE REVENUE OFF ICIALS. IN REBUTTAL THE LD. A.R. HAS INVITED OUR ATTENTION TO THE SUMMONS ISSUED TO THE FATHER AND MOTHER OF SHRI PANDOO P. NAIG. HE H AS INVITED OUR ATTENTION TO SUMMONS DATED 23.05.08 ISSUED TO SHRI T.K. PRABH AKAR NAIG REQUIRING HIM TO BE PRESENT IN THE OFFICE OF DDIT INVESTIGATI ON UNIT, MUMBAI ALONG WITH DOCUMENTS INCLUDING PASSPORT IN ORIGINAL, COPI ES OF THE BANK ACCOUNTS AND ALSO OF THE FIRMS WHERE HE WAS PARTNER, COPIES OF CONFIRMATIONS OF ANY LOAN OUTSTANDING, COPY OF BALANCE SHEET, PROFIT AND LOSS ACCOUNT ALONG WITH COPIES OF BANK ACCOUNTS EVER OPERATED BY HIM OR HIS WIFE IN ANY FOREIGN COUNTRY DURING LAST SIX YEARS. SIMILAR TYPE OF SUM MONS WERE ALSO ISSUED TO SMT. ANANDHI NAIG - MOTHER OF ASSESSEE PANDOO. P. N AIG AND WIFE OF SHRI T.K. PRABHAKAR NAIG. THEREAFTER, SUMMONS DATED MAY 28, 2008 WERE ISSUED TO SHRI T.K. PRABHAKAR NAIG AND MRS. ANANDHI NAIG ASKING THEM TO BE PRESENT IN THE OFFICE OF THE DDIT INVESTIGATION ALONG WITH VARIOUS DETAILS INCLUDING EXHAUSTIVE NOTE IN RELATION TO THE BUSINE SSES CARRIED OUT BY THEM, THEIR PARTNERSHIP IN ANY FIRM, LIST OF BANK ACCOUNT S AND THE SOURCES OF THEIR INCOME DURING STAY ABROAD ETC. THE LD. A.R., THEREF ORE, HAS SUBMITTED THAT NOT ONLY HE, BUT ALSO, HIS AILING FATHER AND MOTHER WERE DISTURBED AND HE WAS COMPELLED TO OFFER AND RETURN THE ADDITIONAL IN COME WITHOUT ANY INCRIMINATING MATERIAL, ASSET, CASH OR SOURCE OF IN VESTMENT FOUND DURING THE COURSE OF SURVEY. 11. WE HAVE CONSIDERED THE RIVAL CONTENTIONS. THE LD. A.R. IN THIS CASE HAS MADE TWO FOLD SUBMISSIONS. FIRSTLY, THAT THE I NCRIMINATING DOCUMENT DOES NOT BELONG TO SHRI PANDOO P. NAIG AND THAT HE HAS NO CONCERN, ITA NO.7089&7364/11 ITA NO.6671&6672/12 19 WHATSOEVER, WITH THE ALLEGED LOOSE PAPERS FOUND DUR ING THE SEARCH ACTION. SECONDLY, THAT HIS STATEMENT RECORDED UNDER SECTION 131 DURING SURVEY ACTION U/S 133A WAS UNDER FORCE, THREAT, COERCION A ND UNDUE INFLUENCE ETC. AND THAT THE SAME CANNOT FORM THE BASIS FOR MAKING ADDITION OF ADDITIONAL INCOME. FIRSTLY, WE DISCUSS ABOUT THE NATURE OF THE DOCUMEN T FOUND DURING THE SURVEY ACTION AND WHETHER AS PER THE PROVISIONS OF SECTION 292C, THE ADDITION OF INCOME ON THE BASIS OF SUCH A DOCUMENT IS JUSTIFIED IN THE HANDS OF ASSESSEE? ADMITTEDLY, THE LOOSE PAPER RELIED UP ON BY THE OPPOSITE PARTIES IS A COMPUTER GENERATED/PRINTED DOCUMENT. NO NAME OF THE ASSESSEE OR ANY OF HIS EMPLOYEES IS MENTIONED ON THE SAID DO CUMENT. THE SAID DOCUMENT DOES NOT BEAR ANY SIGNATURE OR HANDWRITING OF SHRI PANDOO P. NAIG OR OF ANY OF HIS EMPLOYEES. THERE ARE THREE H EADINGS IN THE SAID DOCUMENT I.E. PROFIT, FUNDING AND OWNERSHIP. THERE ARE CERTAIN NAMES OF SCRIPTS/COMPANIES ALONG WITH CODES/SHORT NAMES O F PERSONS WHICH HAVE BEEN MENTIONED IN THE SAID DOCUMENT. THE ASSESSEE SHRI PANDOO P. NAIG HAS SPECIFICALLY DENIED HIS RELATION OR CONNECTION WITH THE DOCUMENT OR ANY OF THE TRANSACTIONS OR THE NAME OF THE PERSONS MENT IONED THEREIN. FURTHER A PERUSAL OF VARIOUS DOCUMENTS ON FILE REVEALS THAT A SSESSEE SHRI PANDOO P. NAIG WAS SUBJECTED TO VARIOUS QUERIES AND INVESTIGA TIONS TO EXTRACT HIS RELATION OR CONCERN WITH THE SAID DOCUMENT OR THE T RANSACTIONS MENTIONED THEREIN. BUT, DESPITE THEIR BEST EFFORTS, NO EVIDE NCE COULD BE EXTRACTED BY THE REVENUE AUTHORITIES WHICH MAY ESTABLISH THE CON CERN OF SHRI PANDOO P. NAIG WITH THE TRANSACTIONS OR THE PERSONS MENTIONED IN THE DISPUTED DOCUMENT. THE SAID DOCUMENT IS A DUMB DOCUMENT. T HE ASSESSEE SHRI PANDOO P. NAIG HAD EXPLAINED THAT THIS DOCUMENT DID NOT BELONG TO HIM AND IT MIGHT HAD BEEN LEFT BY ANY PERSON VISITING HIS O FFICE. ALONG WITH THE SAID DOCUMENT, CERTAIN OTHER DOCUMENTS WERE ALSO FOUND W HEREIN SOME REFERENCE OF SOME AMOUNTS PAID BY CHEQUE, BANK ACCOUNT NUMBER S ETC. HAD BEEN ITA NO.7089&7364/11 ITA NO.6671&6672/12 20 MENTIONED. THE REVENUE AUTHORITIES COULD HAVE EASI LY DETECTED, IF SUCH AN ACCOUNT NUMBER OR PAYMENT HAD BEEN MADE BY OR TO TH E ASSESSEE THROUGH SUCH A BANKING CHANNEL. THOUGH THE DOCUMENT IN QUE STION IS A COMPUTER GENERATED DOCUMENT BUT NO SOFT COPY OF THE SAID DOC UMENT HAD BEEN FOUND OR COULD BE RETRIEVED FROM THE DATA IN THE COMPUTER S AT THE PREMISES OF THE ASSESSEE. THE CASE OF THE AO IS THAT THE ENTRIES I N THE SAID DOCUMENT REPRESENT THE UNDISCLOSED INVESTMENTS AND PROFITS E ARNED BY THE ASSESSEE. THE AO HAS MADE ADDITIONS OF THE TOTAL OF FIGURES M ENTIONED UNDER THE HEADINGS PROFIT, AND OWNERSHIP BUT HAS NOT MADE ANY ADDITION IN RELATION TO FIGURES MENTIONED UNDER THE HEADING FUNDING AS MENTIONED IN THE SAID DOCUMENT. THERE IS NO FINDING OR OBSERVATION MADE BY THE AO AS TO THE NAME OF PERSONS MENTIONED IN THE SAID DOCUMENT AGAI NST THE TRANSACTIONS AS TO WHY THOSE NAMES SHOULD BE IGNORED AND THE TRANSA CTIONS BE TREATED AS RELATING TO THE ASSESSEE PANDOO P. NAIG ONLY. EVEN THE AO HAS IGNORED THE FIGURES UNDER THE HEAD FUNDING. A PERUSAL OF THE IMPUGNED DOCUMENT GIVES IMPRESSION THAT THE TRANSACTIONS MENTIONED TH EREIN RELATE TO MANY PERSONS AND THAT THE SAME DO NOT BELONG TO ANY SING LE PERSON OR THAT THE SAME RELATE TO SOME BROKERAGE AGENT/FIRM WHICH CARRIED ON TRANSACTIONS ON BEHALF OF OTHER PERSONS. ADMITTEDLY, NO EVIDENCE O F ANY HOLDING, ASSET, VALUABLE PROPERTY OR CASH IN THE POSSESSION OF THE ASSESSEE HAD BEEN FOUND DURING SEARCH ACTION OR EVEN DURING POST SURVEY INV ESTIGATIONS. THE AO IN THE ASSESSMENT ORDER IN PARA 8.4(1)(I) HIMSELF HAS GIVEN A FINDING THAT THE SHARE BROKING BUSINESS CARRIED ON BY THE MOTHER OF THE ASSESSEE UNDER THE NAME AND STYLE OF SAI BROKING HAD BEEN CEASED/STOPP ED A FEW YEARS BACK. EVEN NO DATA OR ANY DETAILS RELATING TO ANY SUCH TR ANSACTIONS OR PERSONS COULD BE FOUND OR RETRIEVED FROM THE COMPUTERS IN T HE PREMISES OF THE ASSESSEE. UNDER SUCH CIRCUMSTANCES, IT IS DIFFICULT TO PRESUME THAT THE FIGURES WRITTEN ON SUCH A DUMB DOCUMENT IS THE UNDI SCLOSED INCOME OF THE ASSESSEE. EVEN THE LD. CIT(A) IN THE IMPUGNED ORDER HAS MADE A SPECIFIC ITA NO.7089&7364/11 ITA NO.6671&6672/12 21 OBSERVATION THAT NO CORROBORATIVE EVIDENCE OR UNEXP LAINED CASH OR OTHER ASSET WAS FOUND IN THE POSSESSION OF THE ASSESSEE D URING THE COURSE OF THE SURVEY AND HE THEREFORE HAS DELETED THE ADDITIONS I N RESPECT OF FIGURES MENTIONED UNDER HEAD OWNERSHIP IN THE ALLEGED DOC UMENT. THE LD. CIT(A) THUS DISBELIEVED THE PART OF THE DOCUMENT WHICH THE AO HAD TREATED AS DEPICTING THE UNEXPLAINED INVESTMENTS OF THE ASSESS EE. HENCE, OUT OF THE THREE PARTS OF THE DOCUMENT, ONE PART HAS BEEN IGNO RED BY THE AO, THE SECOND PART HAS BEEN DISBELIEVED BY THE CIT(A). HOW EVER, THE LD. CIT(A) HAS CONFIRMED THE ADDITIONS ONLY IN RESPECT OF HEAD ING PROFIT. HOWEVER, THE POINT WHICH GAINS IMPORTANCE AT THIS STAGE IS THAT WHEN THE SOURCE OF FUNDS/ INVESTMENTS HAVE BEEN DISBELIEVED BY THE CIT (A) , THERE LEFT NO REASON FOR HIM TO ASSUME THE ALLEGED PROFITS FROM S UCH NON EXISTING SOURCE/INVESTMENTS. THE LD. CIT(A), THUS, MADE THE IMPUGNED ADDITIONS ONLY BECAUSE THE ASSESSEE HAD MADE A DECLARATION/OF FER OF INCOME OF RS. 4 CRORES DURING THE SURVEY ACTION. HENCE, VIEWED FR OM ANY ANGLE, THE REVENUE COULD NOT ESTABLISH THE CONCERN OR THE RELA TION OF THE ASSESSEE SHRI PANDOO P. NAIG WITH THE ABOVE SAID DUMB DOCUMENT. 12. NOW COMING TO THE PRESUMPTION UNDER SECTION 292 C. THE PROVISIONS OF THE SAID SECTION FOR THE SAKE OF CONVENIENCE ARE REPRODUCED AS UNDER: (1) WHERE ANY BOOKS OF ACCOUNT, OTHER DOCUMENTS, M ONEY, BULLION, JEWELLERY OR OTHER VALUABLE ARTICLE OR THING ARE OR IS FOUND IN THE POSSESSION OR CONTROL OF ANY PERSON IN THE COURSE OF A SEARCH UNDER SECTION 132 OR SURVEY UNDER SECTION 133A , IT MAY, IN ANY PROCEEDING UNDER THIS ACT, BE PRES UMED ( I ) THAT SUCH BOOKS OF ACCOUNT, OTHER DOCUMENTS, MON EY, BULLION, JEWELLERY OR OTHER VALUABLE ARTICLE OR THING BELONG OR BELONGS T O SUCH PERSON; ( II ) THAT THE CONTENTS OF SUCH BOOKS OF ACCOUNT AND O THER DOCUMENTS ARE TRUE; AND ( III ) THAT THE SIGNATURE AND EVERY OTHER PART OF SUCH B OOKS OF ACCOUNT AND OTHER DOCUMENTS WHICH PURPORT TO BE IN THE HANDWRITING OF ANY PARTICULAR PERSON OR WHICH MAY REASONABLY BE ASSUMED TO HAVE BEEN SIGNED BY, OR TO BE IN THE HANDWRITING OF, ANY PARTICULAR PERSON, ARE IN THAT PERSON'S HANDWRITING, AND IN ITA NO.7089&7364/11 ITA NO.6671&6672/12 22 THE CASE OF A DOCUMENT STAMPED, EXECUTED OR ATTESTE D, THAT IT WAS DULY STAMPED AND EXECUTED OR ATTESTED BY THE PERSON BY W HOM IT PURPORTS TO HAVE BEEN SO EXECUTED OR ATTESTED. 13. A PERUSAL OF THE ABOVE PROVISIONS SHOWS THAT SECTIO N 292C STATES THAT WHERE ANY BOOKS OF ACCOUNTS, OTHER DOCUMENTS . ETC . ARE FOUND IN POSSESSION OR CONTROL OF ANY PERSON IN THE COURSE O F SEARCH ACTION UNDER SECTION 132 OR SURVEY ACTION UNDER 133A; IT MAY BE PRESUMED THAT SUCH BOOKS OF ACCOUNT, OTHER DOCUMENTS ETC. BELONG TO SU CH PERSON AND THAT THE CONTENTS OF SUCH BOOKS OF ACCOUNT AND OTHER DOCUMEN TS ARE TRUE. 14. WE FIND THAT THE WORDING OF THE SECTION 292C WH ICH SUPPOSES THE PRESUMPTION TO BE TAKEN IS QUALIFIED WITH THE WORDS MAY BE, HENCE, IT MAY OR MAY NOT BE PRESUMED THAT SUCH DOCUMENTS BELO NG TO THE PERSON SEARCHED . FIRSTLY, THE SECTION USES THE WORD MAY PRESUME AND NOT SHALL PRESUME, HENCE THE PRESUMPTION OF FACTS UNDER SECT ION 292C IS NOT A MANDATORY OR COMPULSORY PRESUMPTION, BUT, A DISCRET IONARY PRESUMPTION; SECONDLY, SUCH A PRESUMPTION IS NOT A CONCLUSIVE PR ESUMPTION BUT IS A REBUTTABLE PRESUMPTION BECAUSE IT IS A PRESUMPTION OF FACT NOT A PRESUMPTION OF LAW. UNDER THE CIRCUMSTANCES, IT IS TO BE EXAMINED BY THE COMPETENT AUTHORITIES AS TO WHETHER THE PRESUMPTION UNDER THE SECTION IS ATTRACTED OWING TO THE NATURE OF THE DOCUMENTS AND THE CONTENTS OF SUCH DOCUMENTS FOUND DURING SEARCH/SURVEY ACTION. SUCH A PRESUMPTION, THUS, IS NOT AN ABSOLUTE OR CONCLUSIVE PRESUMPTION, BUT, IT HAS TO BE TAKEN IN THE LIGHT OF ANY CORROBORATIVE, CORRELATING OR CIRCUMST ANTIAL EVIDENCE FOUND DURING THE SEARCH OR SURVEY ACTION. IT HAS BEEN HE LD TIME AND AGAIN BY VARIOUS COURTS OF LAW THAT WHERE, THE REVENUE AUTHO RITIES ARE VESTED WITH ANY DISCRETIONARY POWER, THE SAME IS TO BE EXERCISE D JUDICIALLY. THE ASSESSEE SHRI PANDOO P. NAIG, IN THIS CASE, HAS, FR OM THE VERY BEGINNING, DENIED HIS LINK OR RELATION WITH THE SEIZED DOCUMEN T OR WITH ANY OF THE TRANSACTION MADE THEREIN. AS OBSERVED ABOVE, NO CO RROBORATIVE, CORRELATING ITA NO.7089&7364/11 ITA NO.6671&6672/12 23 OR CIRCUMSTANTIAL EVIDENCE HAS BEEN FOUND EITHER DU RING THE SURVEY ACTION OR DURING POST SURVEY INVESTIGATIONS WHICH MAY MAKE A CONNECTION OR IN ANY MANNER RELATE THE ASSESSEE-SHRI PANDOO P. NAIG WITH THE SAID DOCUMENT OR THE TRANSACTIONS MENTIONED THEREIN. HENCE THE NATUR E OF DOCUMENT SEIZED DOES NOT POINT ANY STRONG/RELIABLE OR STANALONE PRE SUMPTION UNDER SECTION 292C OF THE ACT AGAINST THE ASSESSEE SHRI PANDOO P. NAIG. 15. NOW WE HAVE TO EXAMINE AS TO WHAT SHOULD BE T HE DEGREE AND EVIDENCE TO BE PRODUCED BY THE ASSESSEE/PERSON SEARCHED TO R EBUT SUCH PRESUMPTION. THE ASSESSEE SHRI PANDOO P. NAIG IN THIS CASE HAS D ENIED ANY KNOWLEDGE OR LINK OR CONNECTIVITY WITH THE SAID DOCUMENT OR THE CONTENTS OF THE SAID DOCUMENT. NOW UNDER SUCH CIRCUMSTANCES, HOW AN ASS ESSEE OR THE PERSON SEARCHED CAN PROVE THAT THE SAID DOCUMENT DOES NOT BELONG TO HIM OR THAT HE HAS NO CONNECTIVITY WITH SUCH A DOCUMENT, WHEN, HE, HIMSELF, IS NOT AWARE OF ANY OF THE CONTENTS/TRANSACTIONS OR PERSONS NAME D THEREIN. HE, UNDER SUCH CIRCUMSTANCES, IS LEFT WITH NO ALTERNATIVE THE N TO SPECIFICALLY DENY THE SAID DOCUMENT AND TO SHOW FROM HIS ACCOUNTS, BOOKS, OTHER EVIDENCES AND BUSINESS DOCUMENTS AND FROM ALL OTHER MATERIAL GATH ERED DURING THE SEARCH ACTION THAT HE HAS NO CONCERN OR RELATION WITH THE SAID DOCUMENT OR THAT ANY EVIDENCE FOUND IN HIS PREMISES OR POSSESSION IS NOT SUGGESTIVE OF ANY LINK OF HIM OR ANY PERSON OR EMPLOYEE RELATED TO HIM WIT H THE ALLEGED DOCUMENT/LOOSE PAPER FOUND DURING THE SEARCH/SURVEY ACTION. THE AO MAY ALSO CALL UPON OR MAKE ENQUIRIES WHETHER SUCH A REL ATION OF THE ASSESSEE CAN BE ESTABLISHED WITH ANY OF THE TRANSACTIONS MENTION ED IN SUCH DOCUMENT; WHICH COURSE HAS, IN FACT, BEEN ADOPTED BY THE AO I N THIS CASE BUT HE COULD NOT FIND ANY EVIDENCE OR OF ANY RELATION OF THE ASS ESSEE WITH SUCH TYPE OF TRANSACTIONS OF THE ASSESSEE. THE ASSESSEE IS NOT SUPPOSED TO PROVE THE NEGATIVE WHEN UNDER THE CIRCUMSTANCES, IT SEEMS IMP OSSIBLE TO DO SO. THE ASSESSEE THUS HAS DISCHARGED HIS BURDEN OF REBUTTAL OF PRESUMPTION IN THIS ITA NO.7089&7364/11 ITA NO.6671&6672/12 24 CASE. UNDER SUCH CIRCUMSTANCES, THE ADDITIONS IN TH IS CASE SOLELY ON THE BASIS OF PRESUMPTION UNDER SECTION 292C, WHICH STAN DS REBUTTED BY THE ASSESSEE AS DISCUSSED ABOVE, CANNOT BE HELD TO BE JUSTIFIED. THE HONBLE ALLAHABAD HIGH COURT IN THE CASE OF CIT VS. BABU M OHANLAL ARYA SMARAK EDUCATIONAL TRUST (2014) 42 TAXMAN.COM 255 (ALLAHA BAD) HAS OBSERVED THAT WHERE IN A CASE NO EVIDENCE OF ACTUAL RECEIPT OF OWN MONEY/CAPITATION WAS FOUND DURING THE SEARCH ACTION, NO INCRIMINATIN G EVIDENCE OR CORROBORATIVE EVIDENCE WAS FOUND; THE PRESUMPTION U NDER SECTION 292C STANDS REBUTTED BY DENIAL OF THE ASSESSEE UNDER SUC H CIRCUMSTANCES. THE HONBLE DELHI HIGH COURT IN THE CASE OF PRINCIPAL COMMISSIONER OF INCOME TAX VS. DELCO INDIA PVT. LTD. (2016) 67 TAX MAN.COM 357 (DEL.) HAS OBSERVED THAT WHERE THE ASSESSEE HAD CLEARLY DE NIED HAVING ANY DEALING WITH THE CONCERN MENTIONED IN THE LOOSE PAPERS FOUN D AND HAS ALSO PRODUCED ALL NECESSARY DETAILS BEFORE AO TO MAKE NE CESSARY ENQUIRIES IN THIS RESPECT AND THE AO HAS MADE SUCH ENQUIRIES, TH EN, UNDER SUCH CIRCUMSTANCES, SUCH PRESUMPTION STANDS REBUTTED. T HE KOLKATA BENCH OF THE TRIBUNAL IN THE CASE OF NIRMAL FASHIONS PVT. L TD. VS. DCIT (2008) 25 SOT 387 (KOL.) HAS HELD THAT SECTION 292C IS A PRES UMPTIVE PROVISION BUT SAME IS A REBUTTABLE PRESUMPTION AND THE DOCUMENT F OUND DURING THE SEARCH ACTION HAS TO BE CONSIDERED, CONSIDERING THE TOTALI TY OF THE FACTS OF THE CASE. THE DEEMING PROVISION CANNOT BE APPLIED MECHANICALL Y IGNORING THE FACTS OF THE CASE AND THE SURROUNDING CIRCUMSTANCES OF THE F ACTS ARE TO BE CONSIDERED BEFORE THE DRAWING AND INFERENCE OF UNDISCLOSED INC OME ON THE BASIS OF LOOSE PAPERS. WHERE THE REVENUE HAS SEARCHED THE B USINESS PREMISES AS WELL AS RESIDENTIAL PREMISES OF THE FIRM/PARTNERS A ND NOT A SINGLE EVIDENCE OF PURCHASE OR SALE OUTSIDE THE BOOKS OF ACCOUNT WAS F OUND, AND, UNDER THE CIRCUMSTANCES, IT SEEMS IMPOSSIBLE TO CARRY ON BUSI NESS ON A HUGE SCALE OUTSIDE THE BOOKS UNLESS THERE IS SOME UNRECORDED S TOCK, CASH, DEBTORS ETC.; WHEN NO SIGNIFICANT ASSET OUTSIDE THE BOOKS OR NO E VIDENCE OF OSTENSIBLE ITA NO.7089&7364/11 ITA NO.6671&6672/12 25 EXPENDITURE IS FOUND OUTSIDE THE BOOKS, UNDER SUCH CIRCUMSTANCES, ADDITIONS MADE ON THE BASIS OF LOOSE PAPERS BY MAKING CERTAIN PRESUMPTIONS, WHICH WERE FOUND TO BE UNTENABLE OR CONTRARY TO OTHER EVI DENCE ON RECORD, CANNOT BE HELD TO BE JUSTIFIED AND DESERVED TO BE DELETED. THE CO-ORDINATE NAGPUR BENCH OF THE TRIBUNAL IN THE CASE OF ACIT VS. BULD ANA URBAN CO-OPERATIVE CREDIT SOCIETY LTD. (2013) 153 TTJ (NAG) 728 IN SO MEWHAT SIMILAR CIRCUMSTANCES HAS OBSERVED THAT PRESUMPTION GIVEN U NDER SECTION 292C IS NOT CONCLUSIVE BUT IS REBUTTABLE. THE ASSESSEE, SI NCE, IN THE BEGINNING HAS DENIED THAT THE LOOSE PAPERS FOUND TO BE BELONGED T O HIM AND THE SAME WERE NOT IN THE HANDWRITING OF ANY OF THE EMPLOYEES; THE RE BEING NO CORROBORATIVE EVIDENCE AVAILABLE ON RECORD OF FOUND DURING THE COURSE OF SEARCH WHICH MAY PROVE WRONG THE CONTENTION OF THE ASSESSEE THAT THE SAID PAPER DOES NOT BELONG TO HIM AND THE ASSESSEE OFFER S A PLAUSIBLE EXPLANATION REGARDING THE RECOVERY OF SUCH A DOCUMENT IN HIS PR EMISES, THEN UNDER THE CIRCUMSTANCES THE ADDITIONS IN THE ABSENCE OF ANY C ORROBORATIVE EVIDENCE CANNOT BE HELD TO BE JUSTIFIED. THE LUCKNOW BENCH OF THE TRIBUNAL IN THE CASE OF SATNAM SINGH CHHABRA VS. DCIT (2002) 74 T TJ 976 (LUCKNOW) HAS HELD THAT THE UNCORROBORATED LOOSE PAPERS FOUND DURING SEARCH ACTION CANNOT BE TAKEN AS A SOLE BASIS FOR THE DETERMINATI ON OF UNDISCLOSED INCOME. THE CIRCUMSTANTIAL EVIDENCES IN THE CASE IN HAND, S UCH AS THERE BEING NO SOFT COPY/DATA AVAILABLE IN THE COMPUTER SYSTEMS OF THE ASSESSEE IN RELATION TO THE ALLEGED DOCUMENT OR CORRELATING ANY TRANSACTION AS MENTIONED IN THE SAID DOCUMENT; NO RECOVERY OF ANY VALUABLE ASSET, BULLIO N MONEY OR JEWELLERY OR ANY OTHER EVIDENCE OF ANY INVESTMENT AT THE PREMISE S OF THE ASSESSEE; NO DISCOVERY OF ANY INCRIMINATING EVIDENCE DESPITE THO ROUGH INVESTIGATIONS OF THE BOOKS OF ACCOUNT, BANK ACCOUNTS AND OTHER EVIDE NCES DURING THE SURVEY ACTION, POST SURVEY ACTION AND DURING THE ASSESSME NT PROCEEDINGS; THE FACT THAT THE ASSESSEE DURING HIS STATEMENT RECORDED DUR ING THE SURVEY ACTION AND POST SURVEY ACTION, THOUGH, OFFERED ADDITIONAL INCO ME OF RS.4 CRORE, BUT, HAS ITA NO.7089&7364/11 ITA NO.6671&6672/12 26 SPECIFICALLY DENIED HIS RELATION OR LINK OR ENTERIN G INTO ANY TRANSACTION DEPICTED IN THE SAID DOCUMENT; THE ASSESSEE HAS NOT BEEN FOUND IN RELATION OR IN CONTACT WITH ANY OF THE PERSON NAMED IN SUCH DOCUMENT; NO CONNECTION OF THE ASSESSEE WITH ANY OF THE BANK ACC OUNTS MENTIONED IN THE RECOVERED DOCUMENTS AND FURTHER THE FACT THAT THE A SSESSEE HAS NOT INTRODUCED ANY CASH IN HIS BOOKS OF ACCOUNTS ON ACC OUNT OF ADDITIONAL INCOME, FOR WHICH HE HAD ALREADY PAID TAX ALSO, TOG ETHER CONSTITUTE GOOD REBUTTAL TO THE INITIAL PRESUMPTION U/S 292C IN THI S CASE. 16. NOW COMING TO THE RELEVANCY OF STATEMENT/ DISCL OSURE MADE BY THE ASSESSEE DURING SURVEY UNDER SECTION 133A OF THE AC T. THE SURVEY ACTION WAS CARRIED OUT IN THE CASE OF THE ASSESSEE ON THE BASIS OF HIGH VALUE TRANSACTIONS CARRIED OUT IN THE CASE OF BANDARKAR B ROTHERS AND IT WAS CONSIDERED BY THE REVENUE AUTHORITIES THAT PERHAPS BANDARKAR BROTHERS HAD MADE HIGH VALUE INVESTMENTS FOR OR ON BEHALF OF THE ASSESSEE SHRI PANDOO P. NAIG. THE SAID BANDARKAR BROTHERS DURING/ POST THE SURVEY ACTION INVESTIGATIONS HAD OFFERED THE PEAK AMOUNT OF THEIR BANK BALANCE FOR TAXATION AS ADDITIONAL INCOME. HOWEVER THE AO FOUND THAT THEY HAD NOT INCLUDED THE TRANSACTIONS RELATING TO THE DEPOSIT O F RS.33978291/- AND RS.36710971/- RESPECTIVELY IN THEIR BANK ACCOUNTS FOR THE PURPOSE OF DETERMINING THE PEAK CREDIT. HE ACCORDINGLY ADDED T HE SAID AMOUNTS INTO THEIR INCOME BUT ON PROTECTIVE BASIS. DURING THE A PPELLATE PROCEEDINGS BEFORE THE LD. CIT(A), THE SAID BANDARKAR BROTHERS PRODUCED EVIDENCE RELATING TO THE TRANSACTIONS IN THEIR BANK ACCOUNTS AND A REMAND REPORT WAS ALSO CALLED UPON BY THE LD. CIT(A) FROM THE AO. AFT ER EXAMINATION OF THE TRANSACTIONS AND NECESSARY VERIFICATIONS, IT WAS FO UND THAT THE SAID DEPOSITS/ TRANSACTION IN THE BANK ACCOUNTS OF THE BANDARKAR B ROTHERS WAS DULY EXPLAINED. THERE WAS NO CASH DEPOSIT AND EACH OF T HE DEPOSIT WAS THROUGH CHEQUE AND EACH OF THE TRANSACTION STOOD EXPLAINED. NO UNDISCLOSED DEPOSIT ITA NO.7089&7364/11 ITA NO.6671&6672/12 27 RELATING TO THE ABOVE TRANSACTIONS WAS FOUND IN THE BANK ACCOUNTS OF THE BANDARKAR BROTHERS. THE LD. CIT(A), RELYING UPON T HE SAID EVIDENCE, DELETED THE ADDITIONS MADE BY THE AO IN THE HANDS O F THE BANDARKAR BROTHERS ON PROTECTIVE BASIS, WHICH AMOUNT IN FACT WAS ADDED IN THE HANDS OF THE ASSESSEE BY THE AO ON SUBSTANTIVE BASIS. NO W THE FACT WHICH STRIKES ONES ATTENTION AS TO WHEN THE TRANSACTION IN BANDA RKAR BROTHERS ACCOUNT WAS THROUGH BANKING CHANNEL AND THERE WAS NO SCOPE FOR ADDITION OF RS.33978291/- AND RS.36710971/- RESPECTIVELY AS THE IR UNDISCLOSED INCOME THEN WHAT PREVENTED THEM TO EXPLAIN THE TRANSACTIO N OF DEPOSIT DURING SURVEY ACTION OR POST SURVEY ACTION . THE FACTS IT SELF, SPEAK THAT THE BANDARKAR BROTHERS MIGHT HAVE OFFERED THIS ADDITION AL INCOME UNDER PRESSURE FROM THE REVENUE AUTHORITIES BUT SUBSEQUEN TLY THEY RECONCILED EACH TRANSACTION AND PROVED GENUINENESS OF EACH OF THE DEPOSITS AND THE ADDITIONS WERE DELETED IN THEIR CASE. UNDER SUCH C IRCUMSTANCES THE OFFER/SURRENDER MADE BY THEM PROVED TO BE NOT VOLUN TEER BUT UNDER MISTAKEN BELIEF OR PRESSURE. CONSIDERING THE ABOVE FACTS, WE HAVE TO SEE WHAT SANCTITY CAN BE ATTACHED TO THE SURRENDER OF I NCOME MADE BY THE ASSESSEE DURING THE SURVEY ACTION. IT IS TO BE NOT ED THAT DURING THE SURVEY ACTION, NO EVIDENCE OF ANY SUCH SHARE TRANSACTIONS, INVESTMENT, UNDISCLOSED INCOME ETC. WAS FOUND EXCEPT THE LOOSE PAPER WHICH THE ASSESSEE FROM THE BEGINNING AND CONSISTENTLY DENIED TO BE BELONGED TO HIM. DESPITE SUCH DENIAL, A DECLARATION WAS MADE BY SHRI PANDOO P. NA IG OFFERING ADDITIONAL INCOME OF RS.4 CRORE. THESE FACTS AND CIRCUMSTANCES ARE OF THE MORE RELEVANCE IN THE LIGHT OF THE FACTS AND CIRCUMSTANC ES OF THE CASE OF BANDARKAR BROTHERS WHOSE OFFER/DECLARATION OF INCOM E OF PEAK CREDIT AS UNDISCLOSED INCOME RELATING TO THE DEPOSIT OF RS.3 3978291/- AND RS.36710971/- HAS BEEN PROVED TO BE WRONGLY OBTAIN ED. THE FACTS AND CIRCUMSTANCES ON THE FILE SPEAK THAT THE DECLARATIO N TAKEN DURING THE COURSE OF SURVEY FROM THE ASSESSEE WAS NOT BASED ON ANY MA TERIAL EVIDENCE OR ITA NO.7089&7364/11 ITA NO.6671&6672/12 28 BELIEF THAT THE ASSESSEE HAS ANY UNDISCLOSED INCOME OR PROFIT BUT THE SAME PERHAPS WAS GOT FROM THE ASSESSEE UNDER FORCE, PRES SURE OR THREAT. IF, THERE MIGHT HAVE BEEN ANY INCOME OF THE ASSESSEE AND HE H AD MADE VOLUNTARY DECLARATION OF ADDITIONAL INCOME DURING THE SURVEY ACTION, HE, HAVING DEPOSITED THE TAX ON SUCH ADDITIONAL INCOME DECLARE D, UNDER SUCH CIRCUMSTANCES, WOULD HAVE INTRODUCED THE CASH OF RS .4 CRORES AS HIS LIQUID ASSETS IN HIS ACCOUNTS, WHICH HE WOULD HAVE BEEN AB LE TO USE AS ACCOUNTED FOR MONEY FOR HIS FUTURE INVESTMENTS. BUT THE FACT S IN THE CASE REVEAL THAT THE ASSESSEE ON THE LAST DAY OF THE ACCOUNTING YEAR , IN VIEW OF THE DECLARATION MADE, INTRODUCED CASH OF RS.4 CRORES, B UT, ON THE FIRST DAY OF THE NEXT FINANCIAL YEAR, REVERSED THE SAID ENTRY BECAUS E NO CASH WAS AVAILABLE WITH HIM. HOWEVER, NEITHER HE DISCLOSED ANY SOURCE OR ACTIVITY FROM WHICH THE DECLARED INCOME SHOULD BE CONSIDERED TO HAVE BE EN EARNED BY HIM NOR THE AO COULD POINT OUT AS TO FROM WHICH SPECIFIC TR ANSACTIONS THE ASSESSEE MIGHT HAVE EARNED SUCH AN INCOME. THE ASSESSEE EVEN DEPOSITED THE TAXES ON THE ADDITIONAL INCOME BY EN-CASHING HIS FIXED DE POSITS (FDRS) AND BY TAKING LOAN FROM OTHER PERSONS. NEITHER THERE WAS A NY EVIDENCE OF ASSESSEE HAVING ANY ASSET, UNDISCLOSED INCOME OR PROFIT NOR THE ASSESSEE AFTER DECLARATION OF THE INCOME INTRODUCED ANY CASH INTO HIS BOOKS OF ACCOUNT DESPITE PAYING THE TAXES FOR THE SAME. AN ARGUMENT CAN BE MADE THAT IT MAY BE THE MODUS OPERANDI OF THE ASSESSEE TO CONVIN CE THAT THE DECLARATION MADE BY HIM WAS FALSE OR WRONG AND THAT THE SAME WA S UNDER PRESSURE OR THREAT. EVEN IF , FOR THE SAKE OF ARGUMENTS, WE AS SUME IT SO, IT IS TO BE NOTICED THAT THE ASSESSEE HAD PAID TAXES ON THE INC OME DISCLOSED AND IF THE AO WOULD HAVE ACCEPTED HIS RETURNED INCOME AS PER T HE DISCLOSURE, THE ASSESSEE WOULD HAVE GOT NO CHANCE OR OPPORTUNITY TO CLAIM THAT THE DISCLOSURE MADE BY HIM WAS UNDER FORCE, COERCION OR DURESS. HE WOULD HAVE BEEN LEFT WITH NO ALTERNATIVE THAN TO CONSOLE HIMSELF WITH THE TAXES PAID IN CONSEQUENCE OF SUCH DECLARATION MADE. UNDE R SUCH CIRCUMSTANCES, ITA NO.7089&7364/11 ITA NO.6671&6672/12 29 IT WILL BE WRONG TO ASSUME THAT THE ASSESSEE WOULD HAVE TAKEN SUCH A RISK ONLY TO GET AN OPPORTUNITY TO CONTEND THAT THE STAT EMENT MADE BY HIM WAS WRONG OR FALSE OR THE SAME WAS UNDER PRESSURE, THRE AT OR COERCION. HAD THE AO NOT MADE HUGE ADDITIONS ON THE BASIS OF THE LOOS E PAPER SHEET TRADING OF THE FIGURES MENTIONED THEREIN AS UNDISCLOSED INCOME /PROFIT OF THE ASSESSEE THERE MIGHT HAVE NO CHANCE TO CLAIM THE DELETION OF THE ADDITIONAL INCOME ASSESSED BY THE AO ON THE BASIS OF DECLARATION MADE DURING THE SURVEY ACTION. ONCE THE ASSESSEE WAS FORCED INTO THE LITI GATION, THEN ONLY HE GATHERED COURAGE TO FIGHT FOR HIS RIGHTS AND TO SHO W THAT NEITHER THE ALLEGED LOOSE PAPER BELONGS TO HIM NOR HE HAD ANY UNDISCLOS ED INCOME OR PROFITS AND FURTHER THAT EVEN THE DECLARATION TAKEN FROM HI M DURING HIS STATEMENT WAS UNDER THREAT AND PRESSURE. WE MAY DEEM IT FIT TO MENTION HERE THAT THE EFFECT OF FORCE, THREAT UNDUE INFLUENCE OR COERCION DEPENDS UPON THE MENTAL STATE OF A PERSON AND IT MAY VARY FROM PERSON TO PERSON. THE ASSESSEE SHRI PAND OO P. NAIG IN THIS CASE APPEARED TO BE CARRYING ON SUCH PRESSURE AND FEAR O F POSSIBLE CONSEQUENCES OF RETRACTING FROM HIS DECLARATION TILL HE WAS BURD ENED WITH ADDITIONAL ADDITIONS BASED ON THE FIGURES OF THE ONE LOOSE PAP ER AND TILL HE GATHERED COURAGE TO CONTEST THE SAME BY WAY OF FILING APPEAL BEFORE THE LD. CIT(A). 17. SO FAR SO, THE LEGAL SANCTITY OF A STATEMENT MA DE UNDER SECTION 133A DURING THE SURVEY ACTION IS CONCERNED, THE VARIOUS COURTS HAVE HELD TIME AND AGAIN THAT SUCH STATEMENTS DO NOT HAVE ANY EVIDENTI ARY VALUE. THE HONBLE MADRAS HIGH COURT IN THE CASE OF CIT VS. S. KHADER KHAN SON (2008) 300 ITR 0157 HAS OBSERVED THAT AN OFFER OF ADDITIONAL I NCOME MADE IN A STATEMENT DURING THE COURSE OF SURVEY ACTION UNDER SECTION 133A OF THE ACT HAS NO EVIDENTIARY VALUE ESPECIALLY WHEN THERE WAS NO MATERIAL ON RECORD TO PROVE THE EXISTENCE OF SUCH DISCLOSED INCOME OR EAR NING OF SUCH INCOME IN THE HANDS OF THE ASSESSEE. THE HONBLE HIGH COURT FURTHER OBSERVED THAT ITA NO.7089&7364/11 ITA NO.6671&6672/12 30 SECTION 133A OF THE ACT DOES NOT EMPOWER ANY INCOME TAX AUTHORITY TO EXAMINE ANY PERSON ON OATH, HENCE, ANY SUCH STATEME NT HAS NO EVIDENTIARY VALUE AND ANY ADMISSION MADE DURING SUCH STATEMENT CANNOT, BY ITSELF, BE MADE THE BASIS FOR ADDITION. THE ABOVE FINDINGS OF THE HONBLE HIGH COURT HAVE BEEN UPHELD BY THE HONBLE SUPREME COURT AS TH E APPEAL AGAINST THE SAID ORDER HAS BEEN DISMISSED BY THE HONBLE SUPREM E COURT VIDE ORDER DATED 20.09.12 REPORTED IN (2012) 25 TAXMAN.COM 413 . SIMILAR VIEW HAS BEEN ADOPTED BY THE HONBLE DELHI HIGH COURT IN THE CASE OF CIT VS. DHINGRA METAL WORKS (2010) 328 ITR 0384 AND BY THE HONBLE KERALA HIGH COURT IN THE CASE OF PAUL MATHEWS & SONS VS. CIT (2003) 263 ITR 0101. EVEN THE HONBLE A.P. HIGH COURT IN THE CASE OF NARESH KUMAR AGARWAL (2015) 53 TAXMANN.COM 306 (ANDHRA PRADESH) HAS OBSERVED THAT WHERE, IN THE ABSENCE OF ANY INCRIMINATING MATERIAL ETC. FOUND FROM THE PREMISES OF THE ASSESSEE DURING THE COURSE OF SEARC H, STATEMENT OF ASSESSEE RECORDED UNDER SECTION 132(4) WOULD NOT HAVE ANY EV IDENTIARY VALUE. SIMILAR VIEW HAS BEEN ADOPTED BY THE JAIPUR BENCH O F THE TRIBUNAL IN THE CASE OF SHREE CHAND SONI VS. DCIT (2006) 101 TTJ 1028 (JODHPUR). THE HONBLE DELHI HIGH COURT IN THE CASE OF CIT VS . HARJEEV AGARWAL IN ITA NO.8/2004 VIDE ORDER DATED 10.03.16 HAS OBSERVE D THAT A STATEMENT MADE UNDER SECTION 132(4) OF THE ACT ON A STAND-ALO NE BASIS, WITHOUT REFERENCE TO ANY OTHER MATERIAL DISCOVERED DURING S EARCH AND SEIZURE OPERATION, WOULD NOT EMPOWER THE AO TO MAKE A BLOCK ASSESSMENT MERELY BECAUSE ANY ADMISSION WAS MADE BY THE ASSESSEE DURI NG SEARCH OPERATION. IN THE CASE OF COMMISSIONER OF INCOME TAX VS. SUNI L AGARWAL (2015) 64 TAXMAN.COM 107 (DELHI-HC), THE ASSESSEE THEREIN, DU RING THE COURSE OF SEARCH, MADE A CATEGORICAL ADMISSION UNDER SECTION 134 THAT THE CASH AMOUNT SEIZED BELONGED TO HIM AND IT REPRESENTED UN DISCLOSED INCOME NOT RECORDED IN THE BOOKS OF ACCOUNTS. THE ASSESSEE DI D NOT IMMEDIATELY RETRACT FROM THE ABOVE ADMISSION BUT ONLY DURING THE ASSESS MENT PROCEEDINGS AT A ITA NO.7089&7364/11 ITA NO.6671&6672/12 31 BELATED STAGE. IN HIS RETRACTION, THE ASSESSEE STA TED THAT THE SURRENDER WAS MADE UNDER A MISTAKEN BELIEF AND WITHOUT LOOKING IN TO BOOKS OF ACCOUNT AND WITHOUT UNDERSTANDING LAW AND THAT HE HAD BEEN COMPELLED AND PERTURBED BY EVENTS OF SEARCH AND THAT THE PRESSURE OF SEARCH WAS BUILT SO MUCH THAT HE HAD TO MAKE THE SURRENDER WITHOUT HAVI NG ACTUAL POSSESSION OF THE ASSETS OR UNEXPLAINED INVESTMENTS OR EXPENSES I NCURRED AND THAT THERE WAS NO SUCH INCOME AS UNDISCLOSED. THE HONBLE DELH I HIGH COURT, AFTER CONSIDERING THE FACT AND CIRCUMSTANCES OF THE CASE, WHILE DISMISSING THE APPEAL OF THE REVENUE, OBSERVED THAT THOUGH THE FAC T THAT THE ASSESSEE MAY HAVE RETRACTED HIS STATEMENT BELATEDLY, YET, IT DID NOT RELIEVE THE AO FROM EXAMINING THE EXPLANATION OFFERED BY THE ASSESSEE W ITH REFERENCE TO THE BOOKS OF ACCOUNT PRODUCED BEFORE HIM. ALTHOUGH, A STATEMENT UNDER SECTION 132(4) OF THE ACT CARRIES MUCH GREATER WEIG HT THAN THE STATEMENT MADE UNDER SECTION 133A OF THE ACT, BUT A RETRACTE D STATEMENT EVEN UNDER SECTION 132(4) OF THE ACT WOULD REQUIRE SOME CORROB ORATIVE MATERIAL FOR THE AO TO PROCEED TO MAKE ADDITIONS ON THE BASIS OF SUC H STATEMENT. IN THE CASE OF BASANT BANSAL VS. ACIT REPORTED IN (2015)63 TAXMANN.COM 199 (JAIPUR TRIB.), HAVING SOMEWHAT SIMILAR FACTS, THE ASSESSEE THEREIN, DURING THE SEARCH AND SEIZURE ACTION U/S 132 OF THE ACT, OFFERED A SUMMARY DISCLOSER OF INCOME AS UNDISCLOSED AND THE DEPARTME NT ACCEPTED THE SUMMARY SURRENDER OF INCOME AND THEREAFTER ADVANCE TAX FOR THE SAID SURRENDERED OF INCOME WAS ALSO DEPOSITED, BUT THER EAFTER IT WAS CONTENDED BY THE ASSESSEE THAT THE SURRENDER WAS MADE UNDER T HREAT OR COERCION AND THAT NO INCRIMINATING MATERIAL WAS FOUND DURING THE SEARCH ACTION. THE STAND OF THE DEPARTMENT WAS THAT THE ADMISSION WAS VOLUNTARY AND WAS NOT UNDER A MISTAKEN BELIEF OF FACT OR LAW AND THAT THE ASSISTANCE HAD ENOUGH TIME TO GO THROUGH THE FACTS OF THEIR CASE, LAW APP LICABLE IN THEIR CASE AND TAKE ADVICE FROM THEIR COUNSELS AND ADVISORS BEFORE FILING THE LETTER OF SURRENDER OF UNDISCLOSED/UNACCOUNTED INCOME AND THA T THE ADMISSION BY ITA NO.7089&7364/11 ITA NO.6671&6672/12 32 THEM WAS FINAL AND BINDING ON THEM; THE CO-ORDINATE JAIPUR BENCH OF THE TRIBUNAL, AFTER OVERALL APPRECIATION OF THE FACT AN D EVIDENCES BEFORE IT, OBSERVED THAT THE ASSESSEES SURRENDER WAS NOT BASE D ON ANY INCRIMINATING MATERIAL AND THAT THE DISCLOSER BEING NOT VOLUNTARY AND EXTRACTED BY THE DEPARTMENT IN CREATING A COERCIVE SITUATION CANNOT BE RELIED SOLELY TO BE BASIS OF ADDITION AS UNDISCLOSED INCOME. THE CO-OR DINATE BENCH OF THE TRIBUNAL WHILE RELYING UPON VARIOUS CASE LAWS OF TH E HIGHER AUTHORITIES OBSERVED THAT IT IS WELL SETTLED LEGAL POSITION THA T MERELY ON THE BASIS OF A STATEMENT WHICH IS NOT SUPPORTED BY THE DEPARTMENT WITH COGENT CORROBORATIVE MATERIAL CANNOT BE A VALID BASIS FOR SUSTAINING SUCH AD-HOC ADDITION. THE CO-ORDINATE JAIPUR BENCH OF THE TRIB UNAL (SUPRA) FURTHER OBSERVED THAT THE ISSUE OF EXISTENCE OF PRESSURE, T HREAT, COERCION DURING SEARCH PROCEEDINGS IS TO BE JUDGED BY REFERENCE TO THE EXISTING FACTS AND CIRCUMSTANCES, HUMAN CONDUCT AND PREPONDERANCE OF P OSSIBILITIES. DURING THE SEARCH PROCEEDINGS, RECORD RELATING THERETO BEI NG IN EXCLUSIVE CUSTODY OF THE SEARCHING OFFICERS, IT IS THEIR WISH AND WILL W HICH PREVAILS DURING THE FATEFUL PERIOD. THAT IT IS ALMOST IMPOSSIBLE FOR T HE ASSESSEE TO ADDUCE DEMONSTRATIVE EVIDENCE OF EXERTING SUCH PRESSURE. T HE CO-ORDINATE BENCH OF THE TRIBUNAL (SUPRA) WHILE HOLDING SO, APART FROM R ELYING UPON VARIOUS DECISIONS OF THE HIGHER COURTS HAS ALSO RELIED UPON THE DECISION OF THE TRIBUNAL IN THE CASE OF DY CIT VS. PRAMUKH BUILDER S (2008) 112 ITD 179 (AHD.) WHEREIN IT HAS BEEN HELD THAT EVEN IN THE AB SENCE OF PROOF OF COERCION OR PRESSURE, THE STATEMENT BY ITSELF CANNO T BE TAKEN AS CONCLUSIVE. THEREFORE, MERELY IN THE ABSENCE OF PROOF OF PRESSU RE, THREAT, COERCION OR INDUCEMENT THE STATEMENT CANNOT BE HELD AS CONCLUSI VE AND ADDITIONS CANNOT BE MADE BY SOLELY RELYING ON A STATEMENT OR A LETTE R. THE CASE OF THE ASSESSEE, BEFORE US, IS ON BETTER F OOTING AS IN THIS CASE, THE STATEMENT RECORDED OF THE ASSESSEE WAS UN DER SECTION 133A [NOT UNDER SECTION 132(4)], WHICH BEING WITHOUT OATH HAS A VERY WEAK/ LOW ITA NO.7089&7364/11 ITA NO.6671&6672/12 33 EVIDENTIARY VALUE AS COMPARED TO THE STATEMENT MADE U/S 132(4) OF THE ACT. IT HAS BEEN HELD BY THE VARIOUS HIGH COURTS AND THE HONBLE SUPREME COURT THAT A STATEMENT MADE UNDER SECTION 133A, STANDS AL ONE, HAS NO EVIDENTIARY VALUE. 18. EVEN THE CBDT LETTER NO.286/2/2003-IT(INV) DATE D OCT 3, 2003 IN THIS RESPECT READ AS UNDER: TO THE CHIEF COMMISSIONERS OF INCOME TAX, (CADRE CONT RA) & ALL DIRECTORS GENERAL OF INCOME TAX INV. SIR, SUBJECT: CONFESSION OF ADDITIONAL INCOME DURING THE COURSE OF SEARCH & SEIZURE AND SURVEY OPERATION REGARDING INSTANCES HAVE COME TO THE NOTICE OF THE BOARD WHER E ASSESSEES HAVE CLAIMED THAT THEY HAVE BEEN FORCED TO CONFESS THE UNDISCLOS ED INCOME DURING THE COURSE OF THE SEARCH & SEIZURE AND SURVEY OPERATION S. SUCH CONFESSIONS, IF NOT BASED UPON CREDIBLE EVIDENCE, ARE LATER RETRACTED B Y THE CONCERNED ASSESSEES WHILE FILING RETURNS OF INCOME. IN THESE CIRCUMSTA NCES, ON CONFESSIONS DURING THE COURSE OF SEARCH & SEIZURE AND SURVEY OPERATION S DO NOT SERVE ANY USEFUL PURPOSE. IT IS, THEREFORE, ADVISED THAT THERE SHOU LD BE FOCUS AND CONCENTRATION ON COLLECTION OF EVIDENCE OF INCOME WHICH LEADS TO INFORMATION ON WHAT HAS NOT BEEN DISCLOSED OR IS NOT LIKELY TO BE DISCLOSED BEF ORE THE INCOME TAX DEPARTMENTS. SIMILARLY, WHILE RECORDING STATEMENT DURING THE COURSE OF SEARCH IT SEIZURES AND SURVEY OPERATIONS NO ATTEMPT SHOULD BE MADE TO OBTAIN CONFESSION AS TO THE UNDISCLOSED INCOME. ANY ACTIO N ON THE CONTRARY SHALL BE VIEWED ADVERSELY. FURTHER, IN RESPECT OF PENDING ASSESSMENT PROCEEDIN GS ALSO, ASSESSING OFFICERS SHOULD RELY UPON THE EVIDENCES/MATERIALS GATHERED D URING THE COURSE OF SEARCH/SURVEY OPERATIONS OR THEREAFTER WHILE FRAMIN G THE RELEVANT ASSESSMENT ORDERS YOURS FAITHFULLY, A PERUSAL OF THE ABOVE CIRCULAR ALSO SHOWS THAT IT IS IN THE NOTICE OF THE STATUTORY CONTROLLING BODY OF THE INCOME TAX AU THORITIES THAT THE REVENUE OFFICIALS ARE USED TO TAKE CONFESSIONAL STA TEMENTS FROM THE PERSON ITA NO.7089&7364/11 ITA NO.6671&6672/12 34 SEARCHED UNDER FORCE, PRESSURE OR THREAT AND THAT I S WHY THEY HAVE MADE IT MANDATORY THAT ADDITIONS SOLELY ON THE BASIS ON SUC H STATEMENTS SHOULD NOT BE MADE AND THAT CORROBORATIVE EVIDENCES SHOULD BE COLLECTED OR OBTAINED BEFORE MAKING SUCH ADDITIONS. THE CIRCULAR OF THE CBDT IS BINDING ON THE REVENUE OFFICIALS. IN THE FACTS AND CIRCUMSTANCES OF THIS CASE, WHEN SEEN IN THE LIGHT OF ABOVE CASE LAWS AND CBDT CIRCULAR, ADD ITIONS IN THIS CASE CANNOT BE SAID TO BE JUSTIFIABLY MADE. 19. NOW COMING TO THE POINT, WHETHER, THE CLAIM PUT BY THE ASSESSEE SHRI PANDOO P. NAIG BY WAY OF ADDITIONAL GROUND BEFORE T HE LD. CIT(A) REGARDING THE DELETION OF ADDITION OF RS.4 CRORE OF FERED DURING THE SURVEY ACTION AND THEREBY OFFERED IN THE RETURN OF INCOME CAN BE ALLOWED AT THIS STAGE? THE LD. COUNSEL FOR THE ASSESSEE IN THIS RESPECT HA S PLACED RELIANCE ON THE DECISION OF THE HONBLE SUPREME COURT IN THE CASE O F NATIONAL THERMAL POWER CO. LTD. VS. CIT 229 ITR 383. THE FACTS BE FORE THE HONBLE SUPREME COURT WERE THAT THE ASSESSEE IN THAT CASE O FFERED THE INTEREST AMOUNT FOR TAXATION AND THE ASSESSMENT WAS COMPLETE D ON THAT BASIS. BEFORE THE LD. CIT(A), THE ASSESSEE THOUGH HAD TAKE N A NUMBER OF GROUNDS OF APPEAL, HOWEVER, THE INCLUSION OF THE SAID AMOUN T OF INTEREST WAS NOT CHALLENGED. THE INCLUSION OF THE SAID AMOUNT OF IN TEREST WAS NOT OBJECTED TO EVEN IN THE GROUNDS OF APPEAL AS ORIGINALLY FILED B EFORE THE TRIBUNAL. HOWEVER, THE ASSESSEE BY WAY OF SUBSEQUENT LETTER R AISED THE ADDITIONAL GROUND IN RELATION TO THE SAID INCLUSION OF INTERES T INTO THE INCOME OF THE ASSESSEE. IN THE ABOVE CIRCUMSTANCES, THE QUESTION BEFORE THE HONBLE SUPREME COURT WAS WHERE ON THE FACTS FOUND BY THE AUTHORITIES BELOW A QUESTION OF LAW ARISES (THOUGH NOT RAISED BEFORE TH E AUTHORITIES) WHICH BEARS ON THE TAX LIABILITY OF THE ASSESSEE, WHETHER THE T RIBUNAL HAS JURISDICTION TO EXAMINE THE SAME? THE HONBLE SUPREME COURT WHILE ANSWERING THE SAID ITA NO.7089&7364/11 ITA NO.6671&6672/12 35 QUESTION OBSERVED THAT UNDER SECTION 254 OF THE INC OME TAX ACT, THE POWER OF THE TRIBUNAL IN DEALING WITH THE APPEALS IS EXPR ESSED IN THE WIDEST POSSIBLE TERMS; THE POWER OF THE TRIBUNAL UNDER SEC TION 254 IS NOT RESTRICTED ONLY TO DECIDE THE GROUNDS WHICH ARISE FROM THE ORD ER OF THE COMMISSIONER OF INCOME TAX (APPEALS); THAT BOTH THE ASSESSEE AS WELL AS THE DEPARTMENT HAVE A RIGHT TO FILE AN APPEAL/CROSS OBJECTION BEFO RE THE TRIBUNAL AND THE TRIBUNAL IS NOT PREVENTED FROM CONSIDERING QUESTION S OF LAW ARISING IN ASSESSMENT PROCEEDINGS ALTHOUGH NOT RAISED EARLIER. WHILE ANSWERING THE QUESTION IN AFFIRMATIVE, THE HONBLE SUPREME COURT CONCLUDED THAT THE TRIBUNAL HAS JURISDICTION TO EXAMINE A QUESTION OF LAW WHICH ARISES FROM THE FACTS AS FOUND BY THE AUTHORITIES BELOW AND HAVING A BEARING ON THE TAX LIABILITY OF THE ASSESSEE. 20. THE FACTS OF THE CASE IN HAND ARE ON BETTER FOO TING. IN THE CASE IN HAND, THOUGH UNDER CONSISTENT PRESSURE, THE ASSESSE E OFFERED THE ADDITIONAL INCOME FOR TAXATION IN THE ASSESSMENT PROCEEDINGS B UT WHEN HE WAS BURDENED WITH MANY MORE ADDITIONS, HE AT THE FIRST INSTANCE DURING THE APPEAL BEFORE THE LD. CIT(A), CHALLENGED THE OFFER OF ADDITIONAL INCOME ON THE BASIS OF STATEMENT RECORDED UNDER SECTION 133A. EVEN THE SAID GROUND WAS ALSO ADMITTED BY THE LD. CIT(A) FOR ADJUDICATIO N THOUGH FINALLY DECIDED AGAINST THE ASSESSEE. THE FULL BENCH OF TH E HONBLE BOMBAY HIGH COURT IN THE CASES OF AHMEDABAD ELECTRICITY COMPAN Y LTD. VS. CIT AND GODAVARI SUGAR MILLS LTD. VS. CIT BY WAY OF A COM MON ORDER DATED 30.04.1992 (1993) 199 ITR 351 HAS OBSERVED THAT THE BASIC PURPOSE OF AN APPEAL PROCEDURE IN AN INCOME TAX MATTER IS TO ASCE RTAIN THE CORRECT TAX LIABILITY OF THE ASSESSEE IN ACCORDANCE WITH LAW. THEREFORE, AT BOTH THE STAGES, EITHER BY THE APPELLATE ASSISTANT COMMISSIO NER OR BEFORE THE APPELLATE TRIBUNAL, THE APPELLATE AUTHORITY CAN CON SIDER THE PROCEEDINGS BEFORE IT AND THE MATERIAL ON RECORD BEFORE IT FOR THE PURPOSE OF DETERMINING THE CORRECT TAX LIABILITY OF THE ASSESSEE. THE APP ELLATE AUTHORITIES, OF COURSE, ITA NO.7089&7364/11 ITA NO.6671&6672/12 36 CANNOT TRAVEL BEYOND THE PROCEEDINGS AND EXAMINE NE W SOURCE OF INCOME, FOR THAT PURPOSE OTHER SEPARATE REMEDIES ARE PROVID ED TO THE DEPARTMENT UNDER THE INCOME TAX ACT. THE HONBLE FULL BENCH O F THE BOMBAY HIGH COURT OBSERVED THAT APART FROM THE ABOVE, THERE WAS NOTHING IN SECTION 254 OR SECTION 251 WHICH WOULD INDICATE THAT THE APPELL ATE AUTHORITIES ARE CONFINED TO CONSIDERING ONLY THE OBJECTIONS RAISED BEFORE THEM OR ALLOWED TO BE RAISED BEFORE THEM EITHER BY THE ASSESSEE OR BY THE DEPARTMENT, AS THE CASE MAY BE. THEY CAN CONSIDER THE ENTIRE PROCEEDI NGS TO DETERMINE THE TAX LIABILITY OF THE ASSESSEE. THE HONBLE BOMBAY HIGH COURT IN THE CASE OF CIT V S. PRUTHVI BROKERS AND SHAREHOLDERS PVT. LTD. (2012) 349 ITR 336 (BOM .) HAS OBSERVED THAT THE ASSESSEE IS ENTITLED TO RAISE NOT MERELY ADDITI ONAL LEGAL SUBMISSIONS BEFORE THE APPELLATE AUTHORITIES, BUT IS ALSO ENTIT LED TO RAISE ADDITIONAL CLAMS BEFORE THEM. THE APPELLATE AUTHORITIES HAVE JURISD ICTION TO DEAL NOT MERELY WITH ADDITIONAL GROUNDS, WHICH BECAME AVAILABLE ON ACCOUNT OF CHANGE OF CIRCUMSTANCES OR LAW, BUT WITH ADDITIONAL GROUNDS W HICH WERE AVAILABLE WHEN THE RETURN WAS FILED. THE WORDS COULD NOT HA VE BEEN RAISED MUST BE CONSTRUED LIBERALLY AND NOT STRICTLY. THERE MAY BE SEVERAL FACTORS JUSTIFYING THE RAISING OF A NEW PLEA IN AN APPEAL AND EACH CAS E MUST BE CONSIDERED ON ITS OWN FACTS. THE CO-ORDINATE BENCH OF THE TRIBUN AL IN THE CASE OF SHRI CHANDRASHEKHAR BAHIRWANI ITA NO.7810/M/2010 AND 65 99/M/2011 VIDE ORDER DATED 17.06.2015 WHILE DECIDING THE QUESTION AS TO WHETHER THE INCOME CANNOT BE ASSESSED LESS THAN THE RETURNED IN COME HAS OBSERVED AS UNDER: 5. NOW COMING TO THE FINDING OF THE LD. CIT(A), TH AT INCOME CANNOT BE ASSESSED LESS THAN THE RETURNED INCOME, THE LD. A.R . OF THE ASSESSEE HAS SUBMITTED BEFORE US THAT THE ACTION OF THE LD. CIT( A) IN REJECTING THE CLAIM OF THE ASSESSEE ON THIS GROUND WAS NOT JUSTIFIED. HE HAS FURTHER RELIED UPON THE DECISION OF THE HONBLE GUJARAT HIGH COURT IN THE C ASE OF GUJARAT GAS LTD. VS. JCIT (2000) 245 ITR 84. IN THE SAID CASE, THE WOR DS OF THE CIRCULAR NO.549, PARA 5.12, DT. 31 ST OCTOBER, 1989, PROVIDING THAT THE ASSESSED INCOME UNDER SECTION ITA NO.7089&7364/11 ITA NO.6671&6672/12 37 143(3) SHALL NOT BE LESS THAN THE RETURNED INCOME W AS CONSIDERED BY THE HONBLE HIGH COURT AND IT WAS HELD THAT AS PER PROV ISO TO SECTION 119 OF THE ACT, THE BOARD CANNOT ISSUE INSTRUCTIONS TO THE INCOME T AX AUTHORITY TO MAKE A PARTICULAR ASSESSMENT OR TO DISPOSE OF A PARTICULAR CASE IN A PARTICULAR MANNER AS WELL AS NOT TO INTERFERE WITH THE DISCRETION OF THE COMMISSIONER IN EXERCISE OF HIS APPELLATE FUNCTIONS. IT WAS FURTHER HELD THAT THE AO, WHILE EXERCISING HIS QUASI JUDICIAL POWERS, WAS NOT BOUND BY THE SAID CI RCULAR AND SHOULD HAVE EXERCISED HIS POWERS INDEPENDENTLY. THE HONBLE HI GH COURT, THEREFORE, DIRECTED THE AO TO MAKE THE ASSESSMENT WITHOUT KEEP ING IN MIND THE SAID CIRCULAR. IT MAY BE FURTHER OBSERVED THAT THE HON BLE BOMBAY HIGH COURT IN THE CASE OF PRUTHVI BROKERS & SHAREHOLDERS PVT. LTD. ITA NO.3908 OF 2010 DECIDED ON 21.06.12, WHILE RELYING UPON THE VARIOUS DECISIO NS OF THE HONBLE SUPREME COURT AND OTHER HONBLE HIGH COURTS HAS HELD THAT E VEN IF A CLAIM IS NOT MADE BEFORE THE AO, IT CAN BE MADE BEFORE THE APPELLATE AUTHORITIES. THE JURISDICTION OF THE APPELLATE AUTHORITIES TO ENTERTAIN SUCH A CL AIM IS NOT BARRED. THE HONBLE HIGH COURT HAS FURTHER OBSERVED THAT THE DECISION O F THE HONBLE SUPREME COURT IN THE CASE OF GOETZE (INDIA) LIMITED V. CIT (200 6) 157 TAXMAN 1, RELATING TO THE RESTRICTION OF MAKING THE CLAIM THROUGH A REVIS ED RETURN WAS LIMITED TO THE POWERS OF THE ASSESSING AUTHORITY AND THE SAID JUDG MENT DOES NOT IMPINGE ON THE POWER OR NEGATE THE POWERS OF THE APPELLATE AUT HORITIES TO ENTERTAIN SUCH CLAIM BY WAY OF ADDITIONAL GROUND. EVEN OTHERWISE, THE LD. CIT(A) OUGHT TO HAVE CONSIDERED THE CLAIM OF THE ASSESSEE IN EXERCISE OF HIS APPELLATE JURISDICTION UNDER SECTION 250 OF THE ACT. MOREOVER, IF THE ASS ESSEE IS, OTHERWISE, ENTITLED TO A CLAIM OF DEDUCTION BUT DUE TO HIS IGNORANCE OR FOR SOME OTHER REASON COULD NOT CLAIM THE SAME IN THE RETURN OF INCOME, BUT HAS RAISED HIS CLAIM BEFORE THE APPELLATE AUTHORITY, THE APPELLATE AUTHORITY SHOULD HAVE LOOKED INTO THE SAME. THE ASSESSEE CANNOT BE BURDENED WITH THE TAXES WHIC H HE OTHERWISE IS NOT LIABLE TO PAY UNDER THE LAW. EVEN A DUTY HAS ALSO B EEN CAST UPON THE INCOME TAX AUTHORITIES TO CHARGE THE LEGITIMATE TAX FROM THE T AX PAYERS. THEY ARE NOT THERE TO PUNISH THE TAX PAYERS FOR THEIR BONAFIDE MISTAKE S. IN VIEW OF OUR ABOVE OBSERVATIONS, IT IS HELD THAT THE ASSESSEE IS NOT L IABLE TO PAY CAPITAL GAINS TAX, THOUGH ORIGINALLY HE HAD SUBJECTED HIMSELF TO THE S AID TAX AS PER HIS RETURN OF INCOME. THE AO IS DIRECTED TO PROCESS THE CLAIM OF REFUND IN THIS RESPECT AS PER PROVISIONS OF THE LAW. 21. IN VIEW OF THE ABOVE OBSERVATION, WE HOLD THAT THE LD. CIT(A) THOUGH, RIGHTLY ADMITTED THE QUESTION OF LAW AS TO WHETHER THE INCOME OFFERED BY THE ASSESSEE IN THE RETURN OF INCOME CON SEQUENT TO OFFER MADE IN HIS STATEMENT RECORDED DURING THE SURVEY ACTION CAN BE CHALLENGED BEFORE ITA NO.7089&7364/11 ITA NO.6671&6672/12 38 THE APPELLATE AUTHORITY, BUT WRONGLY DECIDED THE S AME IN FAVOUR OF REVENUE. IN VIEW OF OUR FINDINGS GIVEN ABOVE AND IN VIEW OF THE VARIOUS CASE LAWS AS DISCUSSED ABOVE, WE HAVE NO HESITATION TO HOLD THAT THE ADDITIONAL INCOME WAS RETURNED BY THE ASSESSEE PERHAPS UNDER FORCE, P RESSURE, THREAT OR COERCION AND UNDER THE MISTAKEN BELIEF. THE ASSESSE E, IN OUR VIEW, WAS NOT LIABLE TO PAY TAX ON THE SAID ADDITIONAL INCOME RET URNED. WE ACCORDINGLY DIRECT THE DEPARTMENT TO REFUND THE TAXES, IF ANY, PAID BY THE ASSESSEE IN RESPECT OF ADDITIONAL INCOME OFFERED DURING THE SUR VEY ACTION. 22. IN VIEW OF OUR FINDINGS GIVEN ABOVE, WE UPHOLD THE ORDER OF THE LD. CIT(A) DELETING THE ADDITIONS IN THE CASES OF BANDA RKAR BROTHERS. ITA NO.6671/MUM/2012 & ITA NO. 6672/MUM/2012 OF THE REV ENUE ARE THEREFORE DISMISSED. SO FAR AS IN THE CASE OF SHRI PANDOO P. NAIG, THE APPEAL OF THE ASSESSEE BEARING ITA NO.7089/MUM/2011 IS HER EBY ALLOWED WHILE THAT OF REVENUE BEARING ITA NO.7364/MUM/2011 IS HER EBY DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 24/06/20 16. SD/- SD/- (RAJESH KUMAR ) (SANJAY GARG ) / ACCOUNTANT MEMBER / JUDICIAL MEMBER MUMBAI ; DATED 24/06/2016 KISHORE, S PS / COPY OF THE ORDER FORWARDED TO : / BY ORDER, 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ( ) / THE CIT(A), MUMBAI. 4. / CIT 5. , , / DR, ITAT, MUMBAI 6. / GUARD FILE. //TRUE COPY// ITA NO.7089&7364/11 ITA NO.6671&6672/12 39 / ( ASSTT. REGISTRAR) , / ITAT, MUMBAI