JAYANTILAL M. THADESHWAR, MUMBAI V. ITO 25(2)(1), MUMBAI

ITA 7132/MUM/2013

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 0001 (ITAT-MUMBAI)
• Duration Of Justice: 3 year(s) 6 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-06-2017
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: J
• Next Hearing Date: 20-06-2017
• Assessment Year: 2008-2009
• Appeal Filed On: 05-12-2013
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: ARJU GARODIA
• Assessee Lawyers: M SUBRAMANIAN
• Keywords: Unexplained expenditure; Search and seizure; Bonafide belief; Reason to believe; Reassessment proceedings
• Section: 69C; 40A(3); 143(3); 148; 2

Judgement Text

P A G E | 1 IN THE INCOME TAX APPELLATE TRIBUNAL J BENCH, MUMBAI BEFORE SHRI SHAMIM YAHYA , AM AND SHRI RAVISH SOOD, JM ./ I.T.A(S). NO.7132 & 7133/MUM/2013 ( / ASSESSMENT YEAR: 2008 - 09 & 2009 - 10 ) MR. JAYANTILAL M. THADESHWAR 9/B PATEL SHOPPING CENTRE, CHANDAVARKAR LANE, BORIVALI (W), MUMBAI - 400 092 / VS. I.T.O 25(2) IT OFFICE, PRATYAKSHAKAR BHAVAN, BANDRA KURLA COMPLEX, BANDRA (E), MUMBAI - 400 051 ./ ./ PAN/GIR NO. ACAPT4854D ( / APPELLANT ) : ( / RESPONDENT ) / APPELLANT BY : SHRI M. SUBRAMANIAN / RESPONDENT BY : SHRI ARJU GARODIA (D.R.) / DATE OF HEARING : 20/06 /2017 / DATE OF PRONOUNCEMENT : 30 /06/2017 / O R D E R PER RAVISH SOOD, JUDICIAL MEMBER: THE PRESENT SET OF APPEALS FILED BY THE ASSESSEE ARE DIRECTED AGAINST THE RESPECTIVE ORDER S OF THE CIT(A) - 35 , MUMBAI, DATED 06.09.2013, PERTAINING TO A.Y(S) : 200 8 - 0 9 AND 200 9 - 10 , WHICH IN ITSELF ARISES FROM THE RESPECTIVE ORDERS PASSED BY THE ASSESSING OFF ICER U/S 143(3) R.W.S. 147 IN A.Y. 2008 - 09 AND U/S P A G E | 2 143(3) IN A.Y. 2009 - 10. THAT AS CERTAIN COMMON ISSUES ARE INVOLVED IN THE PRESENT APPEALS , THEREFORE, FOR THE SAKE OF CONVENIENCE THEY ARE CLUBBED AND DISPOSED OF BY WAY OF A CONSOLIDATED ORDER. WE HEREIN FIRST TAKE UP THE APPEAL FOR A.Y. 200 8 - 0 9 , MARKED AS ITA NO. 7132 /MUM/201 3 , WHEREIN THE ASSESSEE ASSAILING THE ORDER OF THE CIT(A) HAD RAISED THE FOLLOWING GROUNDS OF APPEAL: - 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE ASSESSMENT ORDER PASSED U/S 143(3) R.W.S. 147 OF THE I.T. ACT IS INVALID AND BAD IN LAW. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LEARNED C.I.T. (A) ERRED IN UPHOLDING THE ACTION OF THE A.O. IN ADDING AN AMOUNT OF RS.6,06,386/ - AS DISALLOWANCE U/S 40A(3)OF THE ACT. 3. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LEARNED C.I.T. (A) ERRED IN UPHOLDING THE ACTION OF THE A.O. IN ADDING AN AMOUNT OF RS.4,71,965/ - AS UNEXPLAINED EXPENDITURE U/S 69C OF THE ACT. 4. O N THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LEARNED C.I.T. (A) ERRED IN NOT DEALING WITH GROUND NOS. 1,2,3,6,7 & 8 OF THE GROUNDS OF APPEAL RAISED BEFORE HIM. THE APPELLANT CRAVE LEAVE TO ADD, ALTER, AMEND OR DELETE ANY OR ALL OF THE GROUNDS OF APPEAL AT ANY TIME. 2. BRIEFLY STATED, THE FACTS OF THE CASE ARE THAT THE ASSESSEE WHO IS A PROPRIETOR OF A CONCERN M/S. JAYANTILAL M . JEWELLERS HAD FILED HIS RETURN OF INCOME FOR A.Y. 2008 - 09 ON 05.1 2 .2008 , DECLARING TOTAL INCOME OF RS. 1,51 ,194/ - . THE A.O ON THE BASIS OF INFORMATION RECEIVED THAT THE ASSESSEE HAD DURING THE PERIOD RELEVANT TO A.Y. 2008 - 09 MADE CASH PURCHASES OF GOLD ORNAMENTS AGGREGATING TO RS. 6,06,386/ - IN CONTRAVENTION OF THE PROVISIONS OF SEC. 40A(3) , IN ITIATED REASSESS MENT PROCEEDINGS U/S 147 IN THE HANDS OF THE ASSESSEE . THE REASONS TO BELIEVE RECOR DED BY THE A.O READ AS UNDER: - THE ASSESSEE FILED RETURN OF INCOME FOR A.Y. 2008 - 09 ON 05.12.2008, DECLARING TOTAL INCOME AT RS. 1,51,160/ - . DURING THE COURSE OF ASSESSMENT PROCEEDINGS FOR A.Y. 2008 - 09 IN THE CASE OF SHRI. JAGDISH L. NANDU, IT IS NOTICED THAT SHRI. JAYANTILAL M. THANDE SHWAR (PROP. OF M/S P A G E | 3 JYANTILAL M. JEWELLERS) HAS PURCHASED GOLD FROM SHRI. JAGDISH L. NANDU IN CASH AS UNDER: - PARTICULARS DATE OF PURCHASE BILL NO. GROSS WEIGHT NET WEIGHT RATE AMOUNT MODE OF PAYMENT 22 CT GOLD ORNAMENT 05.04.2007 0008 /B 122.800 122.800 840 103152 CASH 22 CT GOLD ORNAMENT 18.05.2007 0021/B 119.900 119.900 850 101915 CASH 22 CT GOLD ORNAMENT 11.08.2007 0046/B 138.800 138.800 880 122144 CASH 22 CT GOLD ORNAMENT 11.09.2007 0074/B 91.100 91.100 890 81709 CASH 22 CT GOLD ORNAMENT 22.01.2008 0090/B 116.270 116.270 855 99411 CASH 22 CT GOLD ORNAMENT 28.01.2008 0095/B 116.100 116.100 850 98685 CASH TOTAL PURCHASE 606386 FROM THE ABOVE, IT/S DEAR THAT THE ASSESSEE HAS DEARLY VIOLATED THE PROVISIONS OF SECTION 40A(3) OF THE ACT BY INCURRING EXPENDITURE IN RESPECT OF WHICH PAYMENT IS MADE A SUM EXCEEDING TWENTY THOUSAND RUPEES OTHERWISE THAN BY AN ACCOUNT PAYEE CHEQUE. THEREFORE, I HAVE REASON TO BELIEVE THAT INCOME MORE THAN OF THE RS. 1,00,000/ - HAS ESCAPED THE ASSESSMENT WITHIN THE MEANING OF SECTION 147 OF THE I. T ACT AND ACCORDINGLY, THE CASE OF THE ASSESSEE IS REQUIRED TO BE REOPENED BY ISSUE OF NOTICE U/S. 1 48 OF THE ACT SO AS TO REASSESS THE ASSESSEE C CORRECT INCOME FOR THE A. Y.2008 - 09. 3. THE A.O DURING THE COURSE OF THE RE ASSESSMENT PROCEEDINGS DELIBERATING ON THE FACT THAT THE ASSESSEE HAD MADE CASH PURCHASE S OF GOLD ORNAMENTS AGGREGATING TO RS. 6,06,386 / - FROM SHRI JAGDISH L. NANDU , AS UNDER: - DATE OF PURCHASE AMOUNT MODE OF PAYMENT 05.04.2007 103152 CASH 18.05.2007 101915 CASH 11.08.2007 122144 CASH 11.09.2007 81709 CASH 22.01.2008 99411 CASH P A G E | 4 28.01.2008 98685 CASH , THERE FORE CALLED UPON THE ASSESSEE TO SHOW CAUSE AS TO WHY THE PURCHASE S TO THE SAID EXTENT WOULD NOT CALL FOR A DISALLOWANCE IN TERMS OF SECTION 40A(3) OF THE ACT . THE ASSESSEE SUBMITTED BEFORE THE A.O THAT NOT ONLY THE PURCHASE OF G OLD O RNAMENTS IN CASH WAS NORMAL IN THE LINE OF HIS BUSINESS, BUT EVEN OTHERWISE AS THE PROVISIONS OF SECTION 40A(3) DID N OT TAKE W ITHIN ITS SWEEP THE PURCHASES MADE BY AN ASSESSEE IN THE COURSE OF HIS BUSINESS , THEREFORE, NO DISALLOWANCE UNDER THE SAID DEEMING PROVISION WAS CALLED FOR IN HIS HANDS . THE A.O HOWEVER BEING OF THE VIEW THAT THE EXCEPTIONS TO THE APPLICABILITY OF SECTION 40A(3) WERE EXCLUSIVELY CARVED OUT IN RULE 6DD OF THE I NCOME TAX RULE S, 1962, AND THE CASE OF THE ASSESSEE WAS NOT FOUND TO BE COVERED BY THE EITHER OF THE EXCEPTIONS CONTEMPLATED THEREIN , THEREFORE, DISALLOWED THE PURCHASE OF RS. 6,06,386/ - U/S. 40A(3) IN THE HANDS OF THE ASSESSEE . 4 . THE A.O. FURTHER ON THE BASIS OF THE AIR INFORMATION RECEIVED BY HIM IN THE CASE OF THE ASSESSEE THEREIN OBSERVED THAT THE ASSESSEE HAD DURING THE YEAR MADE PAYMENTS AGAINST CREDIT CARD BILLS , AS UN DER : - NAME OF THE CREDIT CARD BANK MODE OF PAYMENT AMOUNT OF PAYMENT S HSBC LTD. CREDIT CARD 2,13,945/ - ABN AMRO BANK N.V. CREDIT CARD 2,58,020/ - TOTAL: 4,71,965/ - THE A.O ON THE BASIS OF THE AFORESAID INFORMATION CALLED UPON THE ASSESSEE TO FURNISH DETAI LS OF CREDIT CARDS HELD BY HIM, AMOUNT OF PAYMENTS MADE THROUGH CREDIT CARDS, NATURE OF TRANSACTION FOR WHICH PAYMENTS HAVE BEEN MADE, SOURCES OF PAYMENT S MADE TO CR EDIT CARD BANKS WITH DOCUMENTARY EVIDENCES, NAME AND ADDRESS OF THE PARTIES TO WHOM PAYMENT S WERE MADE THROUGH CREDIT CARD S AND THE NATURE OF SAID TRANSACTIONS. THE A.O FURTHER CALLED UPON THE ASSESSEE TO EXPLAIN AS TO WHY THE PAYMENT S MADE TO THE CREDIT CARD BANKS MAY NOT BE P A G E | 5 TREATED AS AN UNEXPLAINED EXPENDITURE AND ADDED BACK TO HIS TOTAL INCOME UNDER SEC . 69C . THE ASSESSEE SUBMITTED BEFORE THE A.O THAT THE CREDIT CARD TRANSACTIONS WERE RELATED TO HIS UNDISCLOSED BUSINESS OF TRADING I N CLOTH MATERIAL FROM WHICH HE WAS EARNING ABOUT 5 - 6 % PROFIT, AND THUS IN THE BACKDROP OF HIS SAID CONTENTION CHARACTERIZED THE AGGREGATE PAYMENTS OF RS. 4,71,965/ - AS THE PAYMENTS MADE TOWARDS PURCHASES MADE IN THE COURSE OF HIS AFORESAID UNDISCLOSED BUS INESS , AND OFFERED FOR TAX 10% OF THE SAME, VIZ. AN AMOUNT OF RS.47,000/ - AS HIS INCOME ARISING THERE FROM . 5 . THE A.O AFTER DELIBERATING ON THE SUBMISSIONS OF THE ASSESSEE , BEING OF THE CONSIDERED VIEW THAT THE SAME WERE NOT SUPPORTED BY ANY DOCUMENTARY EVIDENCE, TH US DID NOT FIND FAVOUR WIT H THE SAME . THE A.O HOLDING A CONVICTION THAT THE CLAIM OF THE ASSESSEE THAT THE CREDIT CARD TRANSACTIONS WERE RELATABLE TO HIS UNDISCLO SED BUSINESS OF TRADING IN CLOTH MATERIAL WAS MERELY AN AFTERTHOUGHT , THEREFORE , DECLINED TO ACCEPT THE SAME . THE A.O THUS , BEING OF THE VIEW THAT NOT ONLY THE ASSESSEE HAD FAILED TO SUBMIT ANY DOCUMENTARY EVIDENCE WHICH COULD GO TO SUBSTANTIATE HIS CONTEN TION THAT T HE CREDIT CARD TRANSACTIONS WERE RELATABLE TO HIS UNDISCLOSED BUSINESS OF TRADING IN CLOTH MATERIAL, BUT RATHER OBSERVING THAT THE SAID CLAIM OF THE ASSESSEE CLEARLY MILITATE D AGAINST THE FACTS AVAILABLE ON RECORD , THEREFORE , REJECTED THE SAME, AND MADE AN ADDITION OF RS.4,71,965/ - UNDER SEC. 69C IN THE HANDS OF THE ASSESSEE. 6 . THE ASSESSEE BEING AGGRIEVED WITH THE ORDER OF THE A.O THUS ASSAILED THE SAME IN APPEAL BEFORE THE CIT(A). THE CIT(A) HOWEVER NOT FINDING FAVOUR WITH THE CONTENTIONS RAISED BY THE ASSESSEE IN RESPECT OF BOTH OF THE AFORESAID ISSUES, VIZ. (I) DISALLOWANCE U/S. 40A(3) OF RS.6,06,386/ - ; AND (II) ADDITION TOWARDS UNEXPLAINED EXPENDITURE U/S. P A G E | 6 69C OF RS.4,71,965/ - , THEREIN CONFIRMED THE RESPECTIVE DISALLOWAN CE/ADDITION AND DISMISSED THE APPEAL OF THE ASSESSEE. 7 . THAT THE ASSESSEE BEING AGGRIEVED WITH THE ORDER OF THE CIT(A), HAD THEREIN CARRIED THE SAME IN APPEAL BEFORE US. THE LD. AUTHORIZED REPRESENTATIVE (FOR SHORT A.R ) FOR THE ASSESSEE HAD AT THE VERY OUTSET OF THE HEARING OF THE APPEAL ASSAILED THE VALIDITY OF THE ASSESSMENT ORDER PASSED U/S. 143(3) R.W.S. 147, AND THEREIN CLAIMED THAT THE SAME WAS INVALID AND BAD IN LAW. THAT IT WAS AVERRED BY THE LD. A.R THAT A PERUSAL OF THE REASONS TO BELIEVE DI D NOT REVEAL ANY SATISFACTION ON THE PART OF THE A.O THAT THE INCOME OF THE ASSESSEE CHARGEABLE TO TAX HAD ESCAPED ASSESSMENT. IT WAS THUS SUBMITTED BY THE LD. A.R THAT DESPITE ABSENCE OF VALID JURISDICTION, THE A.O HAD PROCEEDED WITH AND REOPENED THE CASE OF THE ASSESSEE. PER CONTRA, IT WAS SUBMITTED BY THE LD. DEPARTMENTAL REPRESENTATIVE (FOR SHORT D.R ) THAT THE A.O AFTER DULY RECORDING THE REASONS TO BELIEVE HAD VALIDLY ASSUMED JURISDICTION U/S. 147 AND INITIATED REASSESSMENT PROCEEDINGS IN THE HANDS OF THE ASSESSEE. 8 . THE LD. A.R FURTHER ADVERTING TO THE DISALLOWANCE OF RS. 6,06,836/ - (SUPRA) MADE BY THE A.O U/S 40A(3) , WHICH THEREAFTER HAD BEEN UPHELD BY THE CIT(A), THEREIN SUBMITTED THAT THE ASSESSEE BEING PROMPTED BY BUSINESS PRUDENCE HAD DURING THE YEAR UNDER CONSIDERATION PURCHASED GOLD ORNAMENTS IN CASH FROM SHRI JAGDISH L. NANDU , FOR THE REASON , THAT BY SO DOING HE WAS ABLE TO EARN A DISCOUNT IN RESPECT OF THE PURCHASE S INVOLVED THEREIN. IT WAS FURTHER SUBMITTED BY THE LD. A.R. THAT THE SCOPE OF DISALLOWANCES CONTEMPLATED UNDER SEC. 40A(3) COULD NOT BE STRETCHED TO TAKE WITHIN ITS SWEEP AMOUNTS LAID OUT BY AN ASSESSEE TOWARDS PURCHASES MADE IN THE NORMAL COURSE OF BUSINESS. THE LD. A.R ON THE BASIS OF HIS AFORESAID CONTENTIONS THEREIN SUBMITTED THAT NO DISALLOWANCE U/S 40A(3) IN P A G E | 7 RESPECT OF PURCHASE OF GOLD ORNAMENTS OF RS.6,06,836/ - (SUPRA) WAS CALLED FOR IN THE HANDS OF THE ASSESSEE. THE LD. A.R FURTHER AVERRED THAT RULE 6DD WHICH CARVES OUT CERTAIN EXCEPTIONS IN RESPECT OF APPLICABILIT Y OF THE PROVISIONS OF SECTION 40A(3) DID NOT LA Y DOWN AN EXCLUSIVE LIST OF THE CIRCUMSTANCES WHERE THE DISALLOWANCES CONTEMPLATED UNDER THE SAID STATUTORY PROVISION WOULD NOT BE APPLICABLE, BUT RATHER , THE SAME WAS FLEXIBLE ENOUGH TO TAKE WITHIN ITS SWEE P GENUINE TRANSACTIONS ENTERED INTO BY AN ASSESSEE IN CONTRAVENTION OF THE AFORESAID STATUTORY PROVISION. THE LD. A.R. THUS ON THE BASIS OF HIS AFORESAID AVERMENT HAD TRIED TO IMPRESS UPON US , THAT NOW WHEN THE GENUINENESS AND VERACITY OF THE AFORESAID PUR CHASE TRANSACTION S OF THE ASSESSEE WAS NOT IN DOUBT , THEREFORE , NO DISALLOWANCE UNDER THE AFORESAID STATUTORY PROVISION , VIZ. SE C . 40A(3) R.W. RULE 6DD WAS LIABLE TO BE MADE IN THE HANDS OF THE ASSESSEE. PER CONTRA, THE LD. D.R RELIED ON THE ORDERS OF THE LOWER AUTHORITIES , AND THEREIN AVERRED THAT AS THE ASSESSEE HAD CLEARLY INCURRED A CASH EXPENDITURE OF RS. 6,06,386/ - TOWARDS PURCHASE OF GOLD ORNAMENTS FROM SH. JAGDISH L. NA N DU (SUPRA), THEREFORE , THE SAME CLEARLY BEING IN CONTRAVENTIO N OF THE MANDATE OF SEC. 40A(3) , HAD THUS RIGHTLY BEEN DISALLOWED BY THE A.O AND THEREAFTER UPHELD BY THE CIT(A). 9 . THE LD. A.R LASTLY ASSAILING THE ADDITION OF RS.4,71,965/ - MADE BY THE A.O U/S 69C IN RESPECT OF THE CREDIT CARD TRANSACTIONS , THEREIN SUBMITTED , THAT THE CREDIT CARD TRANSACTIONS WERE RELATABLE TO THE UNDISCLOSED BUSINESS OF TRADING IN CLOTH MATERIAL CARRIED ON BY THE ASSESSEE DURING THE YEAR UNDER CONSIDERATION. IT WAS FURTHER AVERRED BY THE LD. A.R THA T NOW WHEN THE PAYMENTS AGGREGATING T O RS. 4,71,965/ - WERE MADE BY THE ASSESSEE TOWARDS PURCHASES MADE IN THE COURSE OF HIS AFORESAID UNDISCLOSED BUSINESS, THEREFORE, THE A.O INSTEAD OF RESTRICTING THE ADDITION TO THE PROFIT EARNED BY THE ASSESSEE FROM THE SAID BUSINESS, WHICH WAS FAIRLY OFFERED BY THE ASSESSEE AT RS. P A G E | 8 47,200/ - , VIZ. @10% OF THE AGGREGATE OF THE AFORESAID PAYMENTS, HAD HOWEVER ERRED IN ASSESSING THE ENTIRE AMOUNT AS THE INCOME OF THE ASSESSEE . PER CONTRA, THE LD. D.R. RELIED ON THE ORDERS OF THE LOWER AUTHORITIES AND SUBMITTED THAT IN THE ABSENCE OF ANY EVIDENCE IN RESPECT OF ANY BUSINESS OF TRADING IN CLOTH MATERIAL HAVING BEEN CARRIED OUT BY THE ASSESSEE , THE LOWER AUTHORITIES HAD THUS RIGHTLY MADE AN ADDITION OF RS.4,71,965/ - U/S. 69C IN THE HANDS OF THE ASSESSEE. 10 . WE HAVE HEARD THE AUTHORIZED REPRESENTATIVE S FOR BOTH THE PARTIES, PERUSED THE ORDERS OF THE LOWER AUTHORITIES AND THE MATERIAL AVAILABLE ON RECORD. WE FIRST TAKE UP THE CHALLENGE THROWN BY THE ASSESSEE TO THE VALIDITY OF THE REASSESSMENT PROCEEDINGS. WE HAVE GIVEN A THOUGHTFUL CONSIDERATION TO THE CONTENTION OF THE LD. A.R THAT THE REASONS TO BELIEVE DO NOT REVEAL ANY SATISFACTION ON THE PART OF THE A. O THAT THE INCOME OF THE ASSESSEE CHARGEABLE TO TAX HAD ESCAPED ASSESSMENT, FAILING WHICH THE VERY ASSUMPTION OF JURISDICTION U/S 147 IS BAD IN LAW AND THE CONS EQUENTIAL ASSESSMENT FRAMED U/S . 147 R.W.S 143(3) FALLS TO GROUND. WE HAVE PERUSED THE REASONS TO BELIEVE ON THE BASIS OF WHICH THE A.O HAD ASSUMED JURISDICTION U/S 147 , AND THEREIN INITIATED REASSESSMENT PROCEEDINGS IN THE HANDS OF THE ASSESSEE . THAT A BARE PERUSAL OF THE REASONS TO BELIEVE REVEALS THAT THE A.O IN T HE COURSE OF ASSESSMENT PROCEEDINGS IN THE CASE OF ONE SH. JAYANTILA L M. THA N DES H WAR (SUPRA) FOR A.Y. 2008 - 09 , HAD GATHERED INFORMATION THAT THE ASSESSEE HAD MADE CASH PURCHASES OF GOLD ORNAMENTS AGGREGATING TO RS. 6,06,386/ - (SUPRA). WE FIND THAT TH E A.O A CTING ON THE BASIS OF THE AFORE SAID MATERIAL BEFORE HIM, AFTER FORMING A BONAFIDE BELIEF THAT THE CASH PURCHASES MADE BY THE ASSESSEE IN THE COURSE OF HIS JEWELLERY BUSINESS CONTRAVENED THE MANDATE OF SEC. 40A(3), THEREFORE , REOPENED THE CASE OF THE ASSE SSEE. WE ARE OF THE CONSIDERED VIEW , THAT NOW WHEN THE BELIEF ARRIVED AT BY THE A.O IS FOUND TO BE INEXTRICABLY LINKED WITH P A G E | 9 THE MATERIAL AVAILABLE BEFORE HIM, THEREFORE , NO INFIRMITY AS REGARDS THE VALIDITY OF ASSUMPTION OF JURISDICTION BY THE A.O DOES EMERGE FROM THE RECORD. WE FIND THAT THE A.O IN THE BODY OF THE REASONS TO BELIEVE , AFTER MAKING A CLEAR MENTION OF THE CASH PURCHASES OF RS. 6,06,386/ - , ALONGWITH THE BIFURCATED DETAILS AS REGARDS THE SAME, HAD THEREAFTER CLEARLY OBSERVED THAT THE INCOM E OF THE ASSESSEE IN EXCESS OF RS. 1 LAC HAD ESCAPED ASSESSMENT. WE THUS , IN LIGHT OF OUR AFORESAID OBSERVATIONS , ARE UNABLE TO PERSUADE OURSELVES TO SUBSCRIBE TO THE CONTENTION THAT THE A.O HAD INVALIDLY ASSUMED JURISDICTION U/S 147 OF THE ACT. THE GROU ND OF APPEAL NO.1 RAISED BY THE ASSESSEE BEFORE US IS DISMISSED. 11 . WE NOW TAKE UP THE DISALLOWANCE UNDER SEC. 40A(3) OF THE CASH PURCHASE OF JEWELLERY OF RS. 6,06,386/ - , WHICH WE FIND HAD BEEN UPHELD BY THE CIT(A). WE ARE OF THE CONSIDERED VIEW THAT SEC. 40A(3) IS AN OVERRIDING PROVISION , WHICH OPERATES INSPITE OF ANYTHING TO THE CONTRARY CONTAINED IN ANY OTHER PROVISION OF THE ACT RELATING TO THE COMPUTATION OF INCOME UNDER THE HEAD PROFITS AND GAINS OF BUSINESS OR PROFESSION . WE ARE OF THE CONSI DERED VIEW THAT THE AFORESAID STATUTORY PROVISION BEING MANDATORY IN NATURE, CALLS FOR A STRICT COMPLIANCE, WITH THE ONLY EXCEPTIONS AS REGARDS ITS APPLICABILITY HAVING BE EN CARVED OUT BY THE LEGISLATURE IN RULE 6DD. WE FIND T HAT IN THE PRESENT CASE THERE IS NO DENYING OF THE FACT THAT THE ASSESSEE HAD CARRIED OUT CASH PURCHASES AGGREGATING TO RS. 6,06,386 / - , WHICH AS HELD BY THE A.O ARE FOUND TO BE IN CONTRAVENTION OF THE STATUTORY PROVISIONS CONTEMPLATED U/S 40A(3) . T HE ASSESSEE HAD NOT BEEN ABLE TO DEMO NSTRATE EITHER BEFORE THE LOWER AUTHORITIES, NOR BEFORE US, THAT ITS CASE IS COVERED BY EITHER OF THE EXCEPTIONS CONTEMPLATED U/RULE 6DD. RATHER, THE ONLY CONTENTION OF THE LD. A.R IS THAT AS THE GENUINENESS AND VERACITY OF THE PURCHASE TRANSACTIONS UNDER CONSIDERATION ARE NOT IN DOUBT, COUPLED WITH THE FACT THAT THE SAME P A G E | 10 WERE PROMPTED ON ACCOUNT OF BUSINESS EXIGENCIES, THEREFORE , NO DISALLOWANCE U/S 40A(3) OF THE ACT WAS WARRANTED IN THE HANDS OF THE ASSESSEE . WE FIND THE CONTENTION OF THE LD. A.R AT THE FIRST BLUSH TO BE VERY LOGICAL AND CONVINCING , AND THOUGH ARE ONE WITH HIM AS REGARDS THE FACT THAT THE GENUINENESS OF THE PURCHASE TRANSACTIONS HAD NOT BEEN DOUBTED BY THE LOWER AUTHORITIES, BUT THEN AFTER GIVING A THOUGHTFUL CONSIDERATION TO THE MANDATE OF LAW, ARE UNABLE TO PERSUADE OURSELVES TO SUBSCRIBE TO THE VIEW CANVASSED BY HIM . 12. WE ARE OF THE CONSIDERED VIEW THAT A MERE FINDING OF THE PURCHASE TRANSACTIONS AS GENUINE , CANNOT TAKE THE SAME BEYOND THE SCOPE AND KEN OF THE DISALLOWANCE CONTEMPLATED U/S 40A(3), AS ACCEPTANCE OF SUCH A VIEW ON OUR PART WOULD BE NOTHING SHORT OF TRAVERSING BEYOND THE PLAIN LITERAL INTERPRETATION OF THE SAID CLEARLY WORDED STATUTORY PROVISION, WHICH WE ARE AF RAID TO SAY IS NOT PERMISSIBLE UNDER LAW. WE ARE OF THE CONSIDERED VIEW THAT THOUGH THE CONTENTION OF THE ASSESSEE THAT NOW WHEN THE GENUINENESS OF THE PURCHASE TRANS ACTIONS, IDENTITY OF THE PARTY AND THE CIRCUMSTANCES COMPELLING MAKING OF CASH PAYMENTS AR E DEMONSTRATED BY AN ASSESSEE TO THE SATISFACTION OF THE A.O, THEN NO DISALLOWANCE U/S 40A(3) IS WARRANTED, IS A PROPOSITION WHICH DID HOLD THE GROUND UNDER THE PRE - AMENDED PROVISIONS OF SEC. 40A(3) R.W RULE 6DD, AS THE SAME W AS SPECIFICALLY TAKEN CARE OF BY RULE 6DD(J ) A S WAS AVAILABLE ON THE STATUTE UPTO A.Y. 1995 - 96, AND READ AS UNDER: - 6DD. CASES AND CIRCUMSTANCES IN WHICH PAYMENT IN A SUM EXCEEDING TEN THOUSAND RUPEES MAY BE MADE OTHERWISE THAN BY A CROSSED CHEQUE DRAWN ON A BANK OR BY A CROSSED BANK DRAFT: - NO DISALLOWANCE UNDER SUB - SECTION (3) OF SECTION 40A SHALL BE MADE WHERE ANY PAYMENT IN A SUM EXCEEDING TEN THOUSAND RUPEES IS MADE OTHERWISE THAN BY A CROSSED CHEQUE DRAWN ON A BANK OR BY A CROSSED BANK DRAFT IN THE CASES AND CIRCUMSTANCES SPECIF IED HEREUNDER, NAMELY: - .. P A G E | 11 (J) IN ANY OTHER CASE, WHERE THE ASSESSEE SATISFIES THE ASSESSING OFFICER THAT THE PAYMENT COULD NOT BE MADE BY A CROSSED CHEQUE DRAWN ON A BANK OR BY A CROSSED BANK DRAFT - (1) DUE TO EXCEPTIONAL OR UNAVOIDABLE CIRC UMSTANCES ; OR (2) BECAUSE PAYMENT IN THE MANNER AFORESAID WAS NOT PRACTICABLE OR WOULD HAVE CAUSED GENUINE DIFFICULTY TO THE PAYEE, HAVING REGARD TO THE NATURE OF THE TRANSACTION AND THE NECESSITY FOR EXPEDITIOUS SETTLEMENT THEREOF.AND, ALSO FURNISHES EV IDENCE TO THE SATISF ACTION OF THE ASSESSING OFFICER AS TO THE GENUINENESS OF THE PAYMENT AND THE IDENTITY OF THE PAYEE. HOWEVER, THE AFORESAID EXCEPTION CONTEMPLATED BY SUB - RULE ( J ) OF RULE 6DD , WHICH AS OBSERVED BY US HEREINABOVE, PRESCRIBED THE MITIGAT ING CIRCUMSTANCES WITH A VIEW TO RELAX THE RIGORS OF SEC. 40A(3) IN GENUINE AND BONAFIDE CASES , HAD BEEN OMITTED FROM THE STATUTE BY THE LEGISLATURE IN ALL ITS WISDOM, VIDE THE FINANCE ACT, 1995 , W.E.F 01.04.1996 . T HE SCOPE AND EFFECT OF THE AFORESAID AMENDMENT IS FOUND ELABORATED IN CIRCULAR NO. 717, DATED 14 TH AUGUST, 1995 , WHICH READS AS UNDER: - 27.1 .SUB - RULE (J) OF RULE 6DD PRESCRIBES THE MITIGATING CIRCUMSTANCES WITH A VIEW TO RELAX THE RIGORS OF SECTION 40A(3) IN GENUINE AND BONAFIDE CA SES. SUB - RULE (J) WAS INTRODUCED AT A TIME WHEN BANKING FACILITIES HAD YET TO TAKE ROOTS IN RURAL AREAS. NOW THAT THE BANKS HAVE ESTABLISHED THEMSELVES IN RURAL AREAS AND A VAST BRANCH NETWORK IS AVAILABLE, IT IS FELT THAT SUB - RULE (J) HAS OUTLIVED ITS UTI LITY. 13. WE ARE OF THE CONSIDERED VIEW THAT PURSUANT TO OMISSION OF THE AFORESAID RULE 6DD(J) FROM THE STATUTE, AND ABSENCE OF ANY SUCH PARI MATERIA RULE OR EXCEPTION BEING THEREAFTER MADE AVAILABLE, THE CONCESSION OR BENEFIT WHICH WAS EARLIER AVAILABLE TO AN ASSESSEE AS PER P A G E | 12 PRE - AMENDED RULE 6DD (J) , CANNOT BE TRANSPOSED FROM THE PRE - AMENDED PROVISIONS AND READ INTO THE POST - AMENDED PROVISIONS, AND THUS WOULD IN NO WAY COME TO THE RESCUE OF THE ASSESSEE , WHOSE CASE WE FIND IS SQUARELY COVERED BY THE POST - AMENDED SEC. 40A(3) R.W RULE 6DD. WE FIND THAT OUR AFORESAID VIEW STANDS FORTIFIED BY THE JUDGMENT OF THE HONBLE SUPREME COURT IN THE CASE OF : ATTAR SINGH GURMUKH SINGH ( 1991) 191 ITR 667 (SC) , RELEVANT EXTRACT OF WHICH READS AS UNDER: - THE TERMS OF SECTION 40A(3) ARE NOT ABSOLUTE. CONSIDERATION OF BUSINESS EXPEDIENCY AND OTHER RELEVANT FACTOR ARE NOT EXCLUDED. GENUINE AND BONA FIDE TRANSACTIONS ARE NOT TAKEN OUT OF THE SWEEP OF THE SECTION . IT IS OPEN TO THE ASSESSEE TO FURNISH TO THE SATISFA CTION O F THE ASSESSING OFFICER THE CIRCUMSTANCES UNDER WHICH THE PAYMENT IN THE MANNER PRESCRIBED IN SECTION 40A(3) WAS NOT PRACTICABLE OR WOULD HAVE CAUSED GENUINE DIFFICULTY TO THE PAYEE. IT IS ALSO OPEN TO THE ASSESSEE TO IDENTIFY THE PERSON WHO HAS RECEIVED T HE CASH PAYMENT. RULE 6DD PROVIDES THAT AN ASSESSEE CAN BE EXEMPTED FROM THE REQUIREMENT OF PAYMENT BY A CROSSED CHEQUE OR CROSSED BANK DRAFT IN THE CIRCUMSTANCES SPECIFIED UNDER THE RULE. IT WILL BE CLEAR FROM THE PROVISIONS OF SECTION 40A(3) AND RULE 6DD THAT THEY ARE INTENDED TO REGULATE BUSINESS TRANSACTIONS AND TO PREVENT THE USE OF UNACCOUNTED MONEY OR REDUCE THE CHANCES TO USE BLACK MONEY FOR BUSINESS TRANSACTIONS. 14. WE ARE OF THE CONSIDERED VIEW THAT THOUGH THE HON'BLE APEX COURT HAD HELD THAT THE TERMS OF SECTION 40A(3) ARE NOT ABSOLUTE, BUT THEREAFTER , IT HAD CATEGORICALLY STATED THAT GENUINE AND BONAFIDE TRANSACTION S ARE NOT TAKEN OUT OF THE SWEEP OF THE SECTION . WE ARE OF THE CONSIDERED VIEW THAT THE OBSERVATIONS OF THE HON'BL E SUPREME COURT THAT FOR INVOKING SECTION 40A(3) , THE CONSIDERATION OF BUSINESS EXIGENCIES AND OTHER RELEVANT FACTORS ARE NOT EXCLUDED , AND IT IS OPEN TO THE ASSESSEE TO FURNISH TO THE SATISFACTION OF THE A .O THE CIRCUMSTANCES UNDER WHICH THE PAYMENT IN TH E MANNER PRESCRIBED UNDER SECTION 40A(3) WAS NOT PRACTICABLE OR WOULD HAVE CAUSED P A G E | 13 GENUINE DIFFICULTY TO THE PAYEE, WERE RENDERED IN CONTEXT OF AND IN THE COURSE OF INTERPRETING THE SCOPE OF THE AFORESAID PRE - AMENDED RULE 6DD(J ) AS HAD SPECIFICALLY BEEN REF ERRED TO AND APPRECIATED BY THE HONBLE APEX COURT IN ITS AFORESAID JUDGMENT. THUS , IN LIGHT OF OUR AFORESAID OBSERVATIONS THAT THE PRE - AMENDED RULE 6DD(J) WOULD NOT BE APPLICABLE TO THE CASE OF THE ASSESSEE, THE CONTENTION OF THE LD. A.R THAT IN THE BACKD ROP OF THE FACT THAT NOW WHEN THE GENUINENESS AND VERACITY OF THE PURCHASE TRANSACTIONS OF GOLD JEWELLERY AGGREGATING TO RS.6,06,386/ - (SUPRA) IS NOT UNDER ANY DOUBT, COUPLED WITH THE FACT THAT THE SAME WAS PROMPTED BY BUSINESS PRUDENCE, WOULD THUS NOT COME TO THE RESCUE OF THE ASSESSEE. WE THUS IN LIGHT OF OUR AFORESAID OBSERVATIONS ARE THUS UNABLE TO PERSUADE OURSELVES TO SUBSCRIBE TO THE CONTENTIONS OF THE LD. A . R, AND BEING OF THE CONSIDERED VIEW THAT THE CASE OF THE ASSESSEE DOES NOT FALL WITHIN EITHER OF THE EXCEPTIONS CARVED OUT UNDER RULE 6DD OF THE INCOME TAX RULE 1963, THEREFORE, ARE OF THE CONSIDERED VIEW THAT THE CIT(A) HAD RIGHTLY UPHELD THE DISALLOWANCE UNDER SEC. 40A(3) OF THE CASH PURCHASES OF GOLD JEWELLERY OF RS. 6,06,386/ - . THAT BEFORE PARTING ON THE ISSUE UNDER CONSIDERATION, WE MAY FURTHER OBSERVE THAT THE LD. A.R HAD ALSO TRIED TO IMPRESS UPON US THAT THE DISALLOWANCE CONTEMPLATED UNDER SEC. 40A(3) WOULD NOT EXTEND TO THE PURCHASES MADE BY AN ASSESSEE IN THE COURSE OF HIS BUSINESS. WE FIND THAT SUCH A VIEW WAS WAY BACK FAVOURABLY TAKEN BY THE HONBLE HIGH COURT OF GAUHATI IN THE CASE OF CIT VS. HARDWARE EXCHANGE (1991) 190 ITR 61 , WHEREIN IT WAS OBSERVED BY THE HONBLE HIGH COURT THAT PAYMENTS MADE FOR PURCH ASING OF STOCK - IN - TRADE CANNOT BE DISALLOWED UNDER SEC. 40A(3). WE HOWEVER FIND THAT THE SAID JUDGMENT OF THE HONBLE HIGH COURT HAD THEREAFTER BEEN SET ASIDE BY THE HONBLE SUPREME COURT IN THE CASE OF : ATTAR SINGH GURMUKH SINGH (SUPRA) . TH US IN THE BACKDROP OF OUR P A G E | 14 AFORESAID OBSERVATIONS , THE GROUND OF APPEAL NO. 2 RAISED BY THE ASSESSEE BEFORE US IS DISMISSED. 1 5 . WE NOW ADVERT TO THE ADDITION UNDER SEC. 69C OF RS.4,71,965/ - , WHICH WE FIND HAD BEEN UPHELD BY THE CIT(A). WE FIND THAT THE CIT (A) WHILE SUSTAINING THE ADDITION OF RS.4,71,956/ - AS AN UNEXPLAINED EXPENDITURE U/S. 69C OF THE ACT IN THE HANDS OF THE ASSESSEE , HAD OBSERVED AS UNDER: - 5B . THE SECOND ISSUE IS WITH RESPECT TO THE PAYMENTS MADE THROUGH CREDIT CARD TO THE TUNE OF RS.4,71,965/ - . THE ONLY EXPLANATION EXTENDED BY THE APPELLANT IS THAT THE SAID TRANSACTIONS WERE MADE FOR PURCHASE OF CLOTH MATERIALS FROM ONE M/S. NEHA ENTERPRISES AND NIMESH COLLECTION. BUT THE APPELLANT HAS NOT DECLARE D THE EXISTENCE OF SUCH BUSINESS DURING THE FILING OF RETURN AND HIS LATER SUBMISSION THAT THESE PAYMENTS PERTAIN TO TRADING IN CLOTH DEFINITELY APPEARS TO BE AN AFTERTHOUGHT. IT IS ALSO IMPORTANT TO NOTE THAT THE STATEMENT OF THE CREDIT CARD ENTRIES HAS B EEN DONE IN CASH. DURING THE COURSE OF APPEAL, WHILE THE APPELLANT HAS SUBMITTED CONFIRMATION LETTER FROM M/S. NEHA ENTERPRISES AND NIMESH COLLECTION, HOWEVER NO SYSTEMATIC MAINTENANCE OF BOOKS OF ACCOUNTS HAS BEEN PRODUCED. THERE IS NO EVIDENCE OF ANY SALES BEING MADE OF THE CLOTH THAT HAS BEEN ALLEGEDLY BROUGHT FROM THE ABOVEMENTIONED ENTERPRISES. THE ONUS OF EXPLAINING THE NATURE OF THESE TRANSACTIONS AND THE, SOURCE OF MO NEY DEPOSITED INTO BOTH THE ACCOUNTS FROM WHERE CREDIT CARDS ARE BEING OPERATED REMAINS ON THE APPELLANT AND IN MY CONSIDERED OPINION, THE APPELLANT HAS NOT DISCHARGED THIS ONUS. THE ADDITION MADE OF RS.4,71,965/ - AS UNEXPLAINED EXPENDITURE U/S. 69C OF THE I.T. ACT, 1961 IS UPHELD. THAT BEFORE US THE LD. A.R HA D NOT BEEN ABLE TO SUBSTANTIATE HIS CLAIM THAT THE TRANSACTIONS THROUGH THE CREDIT CARD S WERE RELATABLE TO HIS UNDISCLOSED BUSINESS OF TRADING IN CLOTH MATERIAL. WE FIND OURSELVES TO BE IN AGREEMENT WITH THE CIT(A) THAT THE ASSESSEE ON BEING CORNERED WITH THE UNDISCLOSED TRANSACTIONS CARRIED OUT THROUGH HIS CREDIT CARDS, HAD THUS , ON THE BASIS OF AN AFTERTHOUGHT AND A CONCOCTED STORY TRIED TO WRIGGLE OUT OF THE SA ME ON THE BASIS OF AN UNSUBSTANTIATED AND A FRIVOLOUS EXPLANATION. WE ARE OF THE CONSIDERED VIEW , THAT IN THE P A G E | 15 ABSENCE OF ANY MATERIAL WHICH COULD GO TO SUPPORT THE CLAIM OF THE ASSESSEE THAT THE TRANSACTION S CARRIED OUT THROUGH CREDIT CARD S PERTAINED TO HI S UNDISCLOSED BUSINESS OF TRADING IN CLOTH MATERIAL , IT COULD SAFELY AND RATHER INESCAPABLY BE CONCLUDED , THAT THE ASSESSEE HAD FAILED TO EXPLAIN , BOTH THE NATURE OF THE TRANSACTIONS AND THE SOURCE OF MONEY DEPOSITED BY HIM IN THE BANK ACCOUNT S CONNECTED WITH THE CREDIT CARD S. WE THUS FINDING NO INFIRMITY IN THE ORDER OF THE CIT(A) , THUS, UPHOLD THE ADDITION OF RS.4,71,965/ - . THE G ROUND OF APPEAL NO. 3 RAISED BY THE ASSESSEE BEFORE US IS DISMISSED. 1 6 . THAT AS NO AVERMENTS HAD BEEN RAISED BEFORE US BY THE LD. A.R IN CONTEXT OF GROUND OF APPEAL NO. 4 , THEREFORE , THE SAME IS DISMISSED AS NOT PRESSED. THE APPEAL OF THE ASSESSEE IS DISMISSED. ITA NO. 7133/MUM/2013 A.Y. 200 9 - 10 1 7 . WE SHALL NOW TAKE UP THE APPEAL OF THE ASSESSEE FOR THE A.Y. 200 9 - 10 , MARKED AS ITA NO. 7133/MUM/2013. THE ASSESSEE HAD ASSAILED THE ORDER OF THE CIT(A) BY RAISING THE FOLLOWING GROUNDS OF APPEAL: - 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE ASSESSMENT ORDER PASSED U/S 143(3) OF THE I.T. ACT IS INVALID AND BAD IN LAW. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LEARNED C.I.T. (A) ERRED IN UPHOLDING THE ACTION OF THE A.O. IN ADDING AN AMOUNT OF RS. 18,07,855/ - AS UN - EXPLAINED EXPENDITURE U/S . 69C OF THE ACT. 3. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LEARNED C.I.T. (A) ERRED IN NOT DEALING WITH GROUNDS OF APPEAL NOS. 1,2,3,5 & 6 OF THE GROUNDS OF APPEAL RAISED BEFORE HIM. THE APPELLANT CRAVE S LEAVE TO ADD, AL TER, AMEND OR DELETE ANY OR ALL OF THE GROUNDS OF APPEAL AT ANY TIME. P A G E | 16 1 8 . BRIEFLY STATED, THE FACTS OF THE CASE ARE THAT THE ASSESSEE HAD FILED HIS RETURN OF INCOME FOR A.Y. 2009 - 10 ON 09.11.2009 , DECLARING TOTAL INCOME OF RS.1,53,281/ - , WHICH WAS PROCESSED AS SUCH U/S. 143(1) OF THE ACT . THE CASE OF THE ASSESSEE WAS THEREAFTER TAKEN UP FOR SCRUTINY PROCEEDING U/S. 143(2) . THAT DURING THE COURSE OF THE ASSESSMENT PROCEEDINGS THE A.O RECEIVED AIR INFORMATION THAT THE ASSESSEE HAD MADE THE FOLLOWING PAYMENTS AGAINST CREDIT CARD BILLS DURING THE YEAR UNDER CONSIDERATION : - NAME OF THE CREDIT CARDS BANK MODE OF PAYMENT A MOUNT OF PAYMENTS ABN AMRO BANK N.V. CREDIT CARD 7,08,800/ - DEUTSCHE BANK A.G CREDIT CARD 10,89,055 / - TOTAL : 18,07,855 / - THE A.O IN THE BACKDROP OF THE AFORESAID INFORMATION CALLED UPON THE ASSESSEE TO FURNISH DETAILS OF CREDIT CARDS HELD BY HIM, AMOUNT OF PAYMENTS MADE THROUGH CREDIT CARDS, NATURE OF TRANSACTION FOR WHICH PAYMENTS HAVE BEEN MADE, SOURCES OF PAYMENTS MADE TO CREDIT CARD BANKS WITH DOCUMENTARY EVIDENCES, NAME AND ADDRESS OF THE PARTIES TO WHOM PAYMENTS WERE MADE THROUGH CREDIT CARDS AND THE NATURE OF SAID TRANSACTIONS. THE ASSESSEE WAS FURTHER CALLED UPON TO EXPLAIN AS TO WHY THE PAYMENTS MADE TO THE CREDIT CARD BANKS MAY NOT BE TREATED AS AN UNEXPLAINED EXPEND ITURE AND ADDED BACK TO HIS TOTAL INCOME UNDER SEC. 69C. THE ASSESSEE SUBMITTED BEFORE THE A.O THAT THE CREDIT CARD TRANSACTIONS WERE RELATED TO HIS UNDISCLOSED BUSINESS OF TRADING IN CLOTH MATERIAL FROM WHICH HE WAS EARNING ABOUT 5 - 6 % PROFIT, AND THUS IN THE BACKDROP OF HIS SAID CONTENTION CHARACTERIZED THE AGGREGATE PAYMENTS OF RS. 18,07,855/ - AS THE PAYMENTS MADE TOWARDS PURCHASES MADE IN THE COURSE OF HIS AFORESAID UNDISCLOSED BUSINESS, AND OFFERED FOR TAX 10% OF THE SAME, VIZ. AN AMOUNT OF RS.1,80,800 / - AS HIS INCOME ARISING THERE FROM. P A G E | 17 1 9 . THE A.O AFTER DELIBERATING ON THE SUBMISSIONS OF THE ASSESSEE, BEING OF THE CONSIDERED VIEW THAT THE SAME WERE NOT SUPPORTED BY ANY DOCUMENTARY EVIDENCE, THUS DID NOT FIND FAVOUR WITH THE SAME. THE A.O HOLDING A C ONVICTION THAT THE CLAIM OF THE ASSESSEE THAT THE CREDIT CARD TRANSACTIONS WERE RELATABLE TO HIS UNDISCLOSED BUSINESS OF TRADING IN CLOTH MATERIAL WAS MERELY AN AFTERTHOUGHT, THEREFORE DECLINED TO ACCEPT THE SAME. THE A.O THUS, BEING OF THE VIEW THAT NOT O NLY THE ASSESSEE HAD FAILED TO SUBMIT ANY DOCUMENTARY EVIDENCE WHICH COULD GO TO SUBSTANTIATE HIS CONTENTION THAT THE CREDIT CARD TRANSACTIONS WERE RELATABLE TO HIS UNDISCLOSED BUSINESS OF TRADING IN CLOTH MATERIAL, BUT RATHER OBSERVING THAT THE SAID CLAIM OF THE ASSESSEE CLEARLY MILITATED AGAINST THE FACTS AVAILABLE ON RECORD, THEREFORE , REJECTED THE SAME, AND MADE AN ADDITION OF RS.18,07,855/ - UNDER SEC. 69C IN THE HANDS OF THE ASSESSEE. 20 . THE ASSESSEE BY WAY OF RAISING G ROUND OF APPEAL NO. 1 HAD THEREIN ASSAILED BEFORE US THE VALIDITY OF THE ASSESSMENT ORDER PASSED UNDER SECTION 143(3) OF THE ACT . HOWEVER , DURING THE COURSE OF THE HEARING OF THE APPEAL NO AVERMENTS WERE MADE BY THE LD. A.R. AS REGARDS THE SAME. THEREFOR E THE G ROUND OF APPEAL NO. 1 RAISED BY THE ASSESSEE BEFORE US IS DISMISSED AS NOT PRESSED. 21 . THAT IT WAS SUBMITTED BEFORE US THAT THE ISSUE INVOLVED IN THE GROUND OF APPEAL NO. 2 IN THE PRESENT APPEAL, WAS ALSO INVOLVED IN THE CASE OF THE ASSESSEE FOR A.Y. 2008 - 09, MARKED AS ITA NO. 7132/MUM/2013, WHEREIN THE ADDITION MADE BY THE A.O ON A SIMILAR BASIS HAD BEEN ASSAILED BY THE ASSESSEE VIDE G ROUND OF APPEAL NO. 3 BEFORE US . WE FIND THAT AS THE ISSUE INVOLVED IN G ROUND OF APPEAL N O. 2 HAD ALREADY BEEN AD JUDICATED IN THE CASE OF THE ASSESSEE FOR A.Y. 2008 - 09 IN ITA NO. 7132/MUM/2013, THEREFORE OUR ORDER PASSED WHILE DISPOSING OF THE G ROUND OF APPEAL NO. 3 IN THE SAID APPEAL SHALL APPLY P A G E | 18 MUTATIS MUTANDIS IN RESPECT OF THE G ROUND OF APPEAL N O . 2 RAISED BEFORE US. THUS , IN THE BACKDROP OF OUR AFORESAID OBSERVATIONS , WE UPHOLD THE ADDITION OF RS.18,07,855/ - MADE BY THE A.O U/S. 69C, WHICH THEREAFTER HAD BEEN SUSTAINED BY THE CIT(A). THE G ROUND OF APPEAL NO. 2 RAISED BY THE ASSESSEE BEFORE US IS DIS MISSED. 2 2 . THAT AS NO AVERMENT HAD BEEN RAISED BEFORE US IN RESPECT OF G ROUND OF APPEAL NO. 3 , THEREFORE , THE SAME IS DISMISSED AS NOT PRESSED. THE APPEAL OF THE ASSESSEE IS DISMISSED. 2 3 . THE BOTH THE APPEAL S OF THE ASSESSEE , MARKED AS ITA NO. 7132/MUM/2013 FOR A.Y. 2008 - 09 AND ITA NO. 7133/MUM/2013 FOR A.Y. 2009 - 10 ARE THUS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 30 .06.2017 SD/ - SD/ - (SHAMIM YAHYA ) (RAVISH SOOD ) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI ; 30 .0 6 .2017 / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ( ) / THE CIT(A) - 4. / CIT 5. , , / DR, ITAT, MUMBAI 6. / GUARD FILE . //TRUE COPY// P A G E | 19 / BY ORDER, / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI