M/S. DILIP S. DEHERKAR, THANE V. THE DCIT CEN CIR-1, THANE

ITA 747/MUM/2008

• Counselvise Citation: [2010] 136 COUNSELVISE.COM (IT) 0958 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 5 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-07-2010
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: D
• Next Hearing Date: 19-07-2010
• Assessment Year: 2003-2004
• Appeal Filed On: 01-02-2008
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: JI TENDRA YADAV
• Keywords: Income from undisclosed sources; Search and seizure; Corroborative evidences
• Section: 132

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH D, MUMBAI BEFORE SHRI D. MANMOHAN, VICE PRESIDENT AND SHRI R.K. PANDA. ACCOUNTANT MEMBER I.T.A. NO. 747/MUM/2008 ASSESSMENT YEAR : 2003-04 SHRI DILIP S. DEHERKAR MATOSHRI BUNGLOW, NR. MUNICIPAL COMMISSIONER OFFICE, PATLIPADA, HIRANANDANNI ESTATE, G.B. ROAD, THANE PAN: AAOPD7159F VS. DY. CIT CENTRAL CIRCLE-1 THANE APPELLANT RESPONDENT ASSESSEE BY : SHRI PARESH SHAPARIA RESPONDENT BY : SHRI JITENDRA YADAV ORDER DATE OF HEARING: 22.07.2010 DATE OF ORDER: 29.07.2010 PER R.K. PANDA, AM: THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAI NST THE ORDER DATED 22 ND NOVEMBER, 2007 OF THE CIT(A)-I, THANE RELATING TO ASSESSMENT YEAR 2003-04. 2. THE ASSESSEE IN HIS GROUNDS OF APPEAL HAS CHALLENGE D THE ORDER OF THE CIT(A) IN CONFORMING THE ADDITION OF R S.25 LAKHS MADE BY THE ASSESSING OFFICER BEING INCOME FROM UND ISCLOSED SOURCES ON ACCOUNT OF TRANSACTIONS FOR ACQUISITION OF SHARES OF M/S. ELDORADO RESORTS PVT. LTD. 3. FACTS OF THE CASE, IN BRIEF, ARE THAT A SEARCH AND SEIZURE ACTION U/S. 132 OF INCOME-TAX ACT, 1961 (THE ACT) W AS CONDUCTED AT THE PREMISES OF SHRI VISHWAS KULKARNI ALONG WITH OTHER GROUP CASES ON 9 TH SEPTEMBER, 2004 DURING WHICH CERTAIN I.T.A. NO. 747/MUM/2008 SHRI DILIP S. DEHERKAR ==================== 2 INCRIMINATING DOCUMENTS RELATING TO THE ASSESSEE WE RE FOUND AND SEIZED. THE ASSESSING OFFICER SUBSEQUENTLY ISS UED NOTICE U/S. 153C TO THE ASSESSEE. IN RESPONSE TO THIS NOT ICE THE ASSESSEE FILED RETURN OF INCOME DECLARING AN INCOME OF RS.1,12,500. DURING THE ASSESSMENT PROCEEDINGS THE ASSESSING OFFICER NOTED THAT AN MOU DATED 11.7.2002 WAS FOUND DURING THE COURSE OF SEARCH AT THE PREMISES OF SHRI VISHWA S KULKARNI ACCORDING TO WHICH THE ASSESSEE SHRI DILIP S. DEHER KAR ALONG WITH MRS. ANJALI D. DEHERKAR AND SHRI CHETAN D. DE HERKAR HAD ENTERED INTO AN AGREEMENT FOR PURCHASE OF SHARE S OF A PRIVATE LIMITED COMPANY VIZ., M/S. ELDORADO RESORTS PVT. LTD. AS PER THE TERMS AND CONDITIONS OF THE SAID MOU THE PURCHASER I.E., THE ASSESSEE AND TWO OTHER PERSONS BOUGHT THE ENTIRE SHAREHOLDING OF THE SAID COMPANY FOR A TOTAL CONSID ERATION OF RS.1.25 CRORES. AS PER THE SAID MOU THE PAYMENT/ CONSIDERATION IN LIEU OF SHARES WAS AGREED TO BE PA ID BY THE ASSESSEE TO THE TRANSFEROR IN THE FOLLOWING MANNER: A) RS.25,00,000 SIMULTANEOUSLY WITH THE EXECUTION O F MOU. B) RS.50,00,000 WITHIN ONE MONTH FROM THE DATE OF EXECUTION SUBJECT TO THE TRANSFEROR FULFILLING EACH OF THE ALL OBLIGA TIONS. C) RS.50,00,000 WITHIN THREE MONTHS FROM THE DATE O F PAYMENT UNDER CLAUSE (B) ABOVE. 4. THE ASSESSING OFFICER FURTHER NOTED THAT THE ABOVE MOU IS ALSO APPENDED WITH A RECEIPT SHOWING AN AMOUNT O F RS.25 LAKHS AS RECEIVED IN CASH BY THE TRANSFEROR OF THE SHARES FROM THE ASSESSEE AND TWO OTHERS. THE ASSESSING OFFICER ASKED THE ASSESSEE TO EXPLAIN AND PRODUCE DOCUMENTARY EVIDENC E FOR THE SOURCE OF RS.25 LAKHS PAID TO THE TRANSFEROR. IN A BSENCE OF ANY EXPLANATION OR EVIDENCE OFFERED BY THE ASSESSEE REG ARDING THE SOURCE OF RS.25 LAKHS FOR ACQUISITION OF THE SHARES OF THE SAID I.T.A. NO. 747/MUM/2008 SHRI DILIP S. DEHERKAR ==================== 3 COMPANY, THE ASSESSING OFFICER ADDED AN AMOUNT OF R S.25 LAKHS AS UNDISCLOSED INCOME OF THE ASSESSEE. 5. BEFORE THE CIT(A) IT WAS SUBMITTED THAT THE ABOVE INVESTMENT HAS BEEN SHOWN BY SHRI DILIP S. DEHERKAR IN A.Y. 2004-05 AS INCOME FROM UNDISCLOSED SOURCES AND HE H AS PAID TAX OF RS.8 LAKHS FOR THE SAME ON 29 TH OCTOBER, 2004. IT WAS SUBMITTED THAT THE SHARES OF THE COMPANY M/S. ELDOR ADO RESORTS PVT. LTD. WERE TRANSFERRED ON 12 TH JULY, 2003 AND AT THE SAME TIME HE HAS GIVEN CASH OF RS.25 LAKHS. HOWEVE R, SINCE THE ASSESSEE HAS ALREADY PAID TAX ON THE ABOVE UNDI SCLOSED INCOME IN A.Y. 2004-05 THE SAME AMOUNT OF RS.25 LAK HS CANNOT BE TREATED AS INCOME FOR THE A.Y. 2003-04. 6. HOWEVER, THE CIT(A) WAS NOT SATISFIED WITH THE ARGU MENTS ADVANCED BEFORE HIM. HE NOTED THAT THE MOU DATED 1 1 TH JULY, 2002 SEIZED FROM THE PREMISES OF SHRI VISHWAS KULKA RNI, ADVOCATE CONTAINED RECEIPT OF RS.25 LAKHS DULY SIGN ED BY THE VENDOR. NOTHING HAS BEEN PRODUCED BEFORE HIM TO SH OW THAT THE RECEIPT DATED 11 TH JULY, 2002 SHOWING THE PAYMENT OF RS.25 LAKHS BY THE ASSESSEE TO THE VENDOR WAS NOT GENUINE . THE ASSESSEE ALSO FAILED TO PRODUCE ANY CONVINCING EVID ENCE TO SHOW THAT THE AMOUNT OF RS.25 LAKHS WAS ACTUALLY PAID IN JULY, 2003 AND NOT IN JULY, 2002. HE OBSERVED THAT IT IS THE CASE OF CONFIRMED EVIDENCE OF PAYMENT IN THE FORM OF DULY S IGNED MONEY RECEIPT. HE ACCORDINGLY CONFIRMED THE ADDITI ON MADE BY THE ASSESSING OFFICER. AGGRIEVED WITH SUCH ORDER O F THE CIT(A) THE ASSESSEE IS IN APPEAL BEFORE US. 7. THE LEARNED COUNSEL FOR THE ASSESSEE, AT THE OUTSET , SUBMITTED THAT THE ADDITION OF RS.25 LAKHS IN ASSES SMENT YEAR 2003-04 MAY BE CONFIRMED SINCE HE DOES NOT HAVE ANY SUPPORTING EVIDENCE TO SHOW THAT THE SAME DOES NOT RELATE TO I.T.A. NO. 747/MUM/2008 SHRI DILIP S. DEHERKAR ==================== 4 THE A.Y. 2003-04. HOWEVER, HE SUBMITTED THAT A DIRE CTION MAY BE GIVEN TO THE ASSESSING OFFICER TO DELETE THE ADD ITION OF RS.25 LAKHS WHICH HAS BEEN ADDED IN THE TOTAL INCOME OF T HE ASSESSEE FOR A.Y. 2004-05 AS DECLARED BY THE ASSESSEE SINCE THIS WILL AMOUNT TO DOUBLE ADDITION OF THE SAME AMOUNT. 8. THE LEARNED DR, ON THE OTHER HAND, FAIRLY CONCEDED THAT IF THE AMOUNT ADDED BY THE ASSESSING OFFICER IN THE A. Y. 2003-04 IS CONFIRMED THEN SUITABLE DIRECTION MAY BE GIVEN T O THE ASSESSING OFFICER TO DELETE THE ADDITION FROM THE I NCOME OF A.Y. 2004-05 WHERE THE SAME AMOUNT HAS BEEN ADDED AGAIN IN THE ASSESSMENT ORDER. 9. AFTER HEARING BOTH THE SIDES AND IN VIEW OF THE SUBMISSION OF THE LEARNED COUNSEL FOR THE ASSESSEE THAT THE AMOUNT SO ADDED BY THE ASSESSING OFFICER HAS TO BE CONFIRMED IN THIS YEAR, WE UPHOLD THE ORDER OF THE CIT(A) UPH OLDING THE ADDITION OF RS.25 LAKHS. HOWEVER, WE ARE OF THE OP INION THAT ONCE THE ADDITION OF RS.25 LAKHS IS CONFIRMED IN TH IS YEAR, THE SAME CANNOT BE ADDED AGAIN IN THE A.Y. 2004-05 WHER E THE ASSESSEE HAS OFFERED THE SAME FOR TAXATION FOR A.Y. 2004-05 AS AGAINST A.Y. 2003-04. THE ASSESSING OFFICER WHILE PASSING THE ORDER FOR A.Y. 2004-05 SHOULD KEEP THIS IN MIND. I N THIS VIEW OF THE MATTER, THE GROUND RAISED BY THE ASSESSEE IS DI SMISSED. 10. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS DISMISSED. PRONOUNCED IN THE OPEN COURT ON 29 TH JULY, 2010 SD/- (D. MANMOHAN) VICE PRESIDENT SD/- (R.K. PANDA) ACCOUNTANT MEMBER MUMBAI, DATED 29 TH JULY, 2010 I.T.A. NO. 747/MUM/2008 SHRI DILIP S. DEHERKAR ==================== 5 COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT(A)-I, THANE 4. THE CIT-II, MUMBAI 5. THE DR D BENCH. //TRUE COPY// BY ORDER ASSISTANT REGISTRAR ITAT MUMBAI BENCHES, MUMBAI TPRAO