SHRI PRADEEP KUMAR CHOUDHARY, KISHANGARH V. DEPUTY COMMISSIONER OF INCOME TAX, AJMER

ITA 868/JPR/2017

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 2036 (ITAT-JAIPUR)
• Duration Of Justice: 3 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-03-2018
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Assessment Year: 2014-2015
• Appeal Filed On: 22-11-2017
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: DR A D HOSMANI JCIT DHK
• Assessee Lawyers: S L PODDAR; ISHA KANUNGO
• Section: 133A

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES, JAIPUR JH FOT; IKY JKO] U;KF;D LNL; ,OA JH HKKXPAN] YS[KK LNL; DS LE{K BEFORE: SHRI VIJAY PAL RAO, JM & SHRI BHAGCHAND, A M VK;DJ VIHY LA-@ ITA NO. 868/JP/2017 FU/KZKJ.K O'KZ@ ASSESSMENT YEAR : 2014-15 PRADEEP KUMAR CHOUDHARY, CHOUDHARY SADAN, HAMIR COLONY, MADANGANJ, KISHANGARH. CUKE VS. D.C.I.T., CIRCLE-1, AJMER. LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO.: AALPC 7078 H VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT FU/KZKFJRH DH VKSJ LS@ ASSESSEE BY : SHRI S.L. PODDAR & MS. ISHA KANUNGO (ADV) JKTLO DH VKSJ LS@ REVENUE BY : SMT. DR. A.D. HOSMANI (JCIT) LQUOKBZ DH RKJH[K@ DATE OF HEARING : 13/02/2018 MN?KKS'K.KK DH RKJH[K @ DATE OF PRONOUNCEMENT : 05/03/2018 VKNS'K@ ORDER PER: BHAGCHAND THIS IS THE APPEAL FILED BY THE ASSESSEE EMANATES F ROM THE ORDER OF THE LD. CIT(A), AJMER DATED 09/10/2017 FOR THE A.Y. 2014-15. 2. THE ASSESSEE IS AN INDIVIDUAL AND IS ENGAGED IN T HE BUSINESS MANUFACTURING AND TRADING OF CLOTHS IN THE NAME & S TYLE OF M/S PRADEEP TEXTILES. RETURN OF INCOME WAS FILED ON 30.07.2014 DE CLARING TOTAL INCOME AT RS. 2,69,33,690/-. A SURVEY OPERATION U/S 133A O F THE INCOME TAX ACT, 1961 (IN SHORT THE ACT) WAS CARRIED OUT ON 13.09.201 3 AT M/S LOVELY ITA 868/JP/2017_ PRADEEP KR. CHOUDHARY VS DCIT 2 COLONIZERS PVT. LTD. KISHANGARH. THE ASSESSING OFFIC ER MADE ADDITION OF RS. 55,80,000/- ON ACCOUNT OF ADVANCES CLAIMED TO H AVE BEEN FOUND NOTED IN 'ROSHAN EXERCISE NOTEBOOK' DURING THE COUR SE OF SURVEY OPERATION, WHICH WAS TREATED AS UNEXPLAINED. THE ASSES SEE CLAIMED THAT THIS ADDITION HAS BEEN MADE WITHOUT INVOKING ANY PRO VISIONS OF LAW. THE ADDITION IS BASED PURELY ON THE BASIS OF STATEMENT RECORDED DURING THE SURVEY OPERATION UNDER DURESS, WHICH HAS NO EVIDENTI ARY VALUE. 3. THE ONLY ISSUE INVOLVED IN THE APPEAL IS CONFIRM ING THE ADDITION OF RS. 55,80,000/- BY THE LD. CIT(A). ON THE BASIS OF NOTE BOOK PLACED AT PAGE NOS. 1 TO 4 OF THE PAPER BOOK, IT IS WORKED OUT THAT THE ASSESSEE HAD MADE ADVANCES TOTALING TO RS. 7,12,00,000/- IN CASH FOR PURCHASE OF LAND OR ON LOAN AND ACCORDINGLY A SURRENDER WAS OBTA INED BY THE SURVEY TEAM. THERE WAS SHORTAGE OF CASH OF RS. 42,00,000/- AND AFTER GIVING THE CREDIT TO THE SHORTAGE, THE UNACCOUNTED ADVANCE S WORKED OUT AT RS. 6.70 CRORES. THE SURRENDERED INCOME OF RS. 2,64,20,0 00/- IN HIS HANDS AND A SUM OF RS. 2,77,40,000/- IN THE HANDS OF HIS WIFE NAMELY SMT. KUSUM CHOUDHARY AND THE SAME WAS DULY REFLECTED IN T HE INCOME TAX RETURN FILED. THUS, THERE WAS A SHORT DECLARATION OF RS. 1,28,51,000/- IN COMPARISON TO THE STATEMENT GIVEN DURING THE SURVEY OPERATION. THE ASSESSING OFFICER MADE ADDITION OF RS. 55,80,00 0/- IN THE ITA 868/JP/2017_ PRADEEP KR. CHOUDHARY VS DCIT 3 HANDS OF THE ASSESSEE AND RS. 72,60,000/- IN THE HA NDS OF WIFE OF ASSESSEE SMT. KUSUM CHOUDHARY. 4. THE LD AR OF THE ASSESSEE HAS PLEADED THAT THE ST ATEMENT U/S 133A OF THE ACT HAS NO EVIDENTIARY VALUE AS HELD BY THE HONBLE MADRAS HIGH COURT IN THE CASE OF CIT VS KADER KHAN SON 300 ITR 157 (MAD). HE ALSO PLEADED THAT THE STATEMENT WAS RECORDED UNDER D URESS AND IT IS AGAINST THE BASIC SPIRIT OF BOARD CIRCULAR. IT WAS A LSO ALLEGED THAT ROSHAN EXERCISE NOTE BOOK WAS PREPARED BY THE SURVEY TEAM T O OBTAIN THE SURRENDER. THIS DOES NOT CONTAIN ANY DETAILS OF PURC HASE OF LAND FROM WHOM THE LAND WAS PURCHASED AND ALSO DOES NOT CONTAIN ANY ADDRESS OF THE PERSON TO WHOM THE AMOUNT WAS ADVANCED. IN VIEW OF THIS, IT WAS CLAIMED THAT THIS EXERCISE NOTEBOOK IS A ROUGH AND DUMP PAPER, IT CANNOT BE RELIED UPON IN VIEW OF THE DECISION IN THE CASE O F CENTRAL BUREAU OF INVESTIGATION VS V.C. SHUKLA & ORS. IN CRL. A. NO.- 000247-000256/1998 ORDER DATED 2 ND MARCH, 1998. IT IS SUBMITTED THAT THE ENTRIES NOTE D IN THE ROSHAN EXERCISE NOTEBOOK WERE ENTERED REPETITIVELY A ND THE PART OF IT, WHICH HAS BEEN REPEATED NEEDS TO BE IGNORED. HE HAS ALSO SUBMITTED THAT THIS NOTEBOOK WAS WRITTEN ON THE DATE OF SURVEY WITH THE SAME PEN, HAVING THE SAME INK, BY THE SAME PERSON, HAVING THE SAME STYLE OF WRITING. IT WAS ALSO SUBMITTED THAT THE PERSONS, WHOS E NAMES WERE ITA 868/JP/2017_ PRADEEP KR. CHOUDHARY VS DCIT 4 WRITTEN ON THE ROSHAN EXERCISE NOTEBOOK IS ASHOK DET H, LAL RAM, SITA RAM, YASODA, LADU RAM AND PRADEEP CHOUDHARY. THE SUR VEY TEAM HAS NOT BOTHERED TO ENQUIRE ABOUT THE DETAILS OF LAND P URCHASED AND NAME AND ADDRESS OF PERSONS TO WHOM SUCH ADVANCES CLAIMED TO HAVE BEEN MADE. NO EFFORTS WERE MADE TO CORROBORATE THE NOTING S ON THE NOTEBOOK EITHER BY OBTAINING DETAILS OF LAND PURCHASED OR BY EXAMINING ANY OF THE PERSON, WHOSE NAMES WERE REFLECTED IN THE NOTEBOOK. H E ALSO SUBMITTED THAT THERE ARE MULTIPLE ENTRIES FOR WHICH HE HAS SUB MITTED A CHART AS UNDER: ENTRIES RECORDED IN MULTIPLE 19.08.2013 1100000 19.08.2013 1100000 19.08.2013 1100000 19.08.2013 1100000 09.09.2013 2100000 28.08.2013 2100000 09.09.2013 2100000 16.07.2013 2100000 LESS RECOVERED 51000 TOTAL 12851000 HE PLEADED THAT THE ADDITION FOR REPEATED ENTRIES S HOULD NOT HAVE BEEN MADE AS THE ENTRY OF RS. 11,00,000/- ON 19/08/2013 WAS ENTERED FOUR ITA 868/JP/2017_ PRADEEP KR. CHOUDHARY VS DCIT 5 TIMES AND THE ENTRY OF RS. 21,00,000/- IS TWICE ON 0 9/09/2013. HE ALSO PLEADED THAT THE SURRENDER OBTAINED DURING THE SURV EY OPERATION IS AGAINST THE BOARD CIRCULAR/INSTRUCTION. HE SUBMITTE D THAT OFFICERS OF THE DEPARTMENT ARE BOUND TO FOLLOW THE CIRCULAR OF THE B OARD AND HE RELIED FOR THIS PROPORTION IN THE CASE OF CWT VS SANWARMAL SHIV KUMAR 171 ITR 337 (RAJ). HE ALSO RELIED ON THE FOLLOWING CASE LAWS: (I) NAVNIT LAL C JAVERI VS. SEN (1965) 56 ITR 198 (S C) (II) K.P. VARGHESE VS. ITO (1981) 131 ITR 597 (SC) (III) UCO BANK VS. CIT (1999) 237 ITR 889 (SC) (IV) UNION OF INDIA VS. AZADI BACHOO ANDOLAN (2003) 263 ITR 706(SC) HE ALSO SUBMITTED THAT THE ADDITION CANNOT BE MADE ONLY ON THE BASIS OF STATEMENT. HE ALSO RELIED ON THE FOLLOWING CASE LAWS: (I) CIT VS. KADER KHAN SON 300 ITR 157 (MAD) (II) PAUL MATHEWS 263 ITR 101 (KER) (III) KAILASH BEN MOHANLAL CHOKSI V/S CIT (2008) 14 DTR (GUJ) 257 (IV) CONTECH TRANSPORT SERVICE (P) LTD ORS V/S ACIT ( 2009) 19 DTR 191 (MUMBAI) 28-11-08 (V) CHITRA DEVI V/S ACIT (JODHPUR BRANCH) (2002) 77 TTJ (JD) 640 (VI) AJIT CHINTAMAN KARVE V/S I.T.O. (2009) 311 ITR ( AT) 66 (PUNA) ITAT BENCH ITA 868/JP/2017_ PRADEEP KR. CHOUDHARY VS DCIT 6 (VII) CIT VS. BHASKAR MITTAL 73 TAXMAN 437 (CAL) (VIII) KAILASHHEN MANHARLAL CHOKSHI VS CIT (2008) 14 DTR 257 (GUJ) (IX) PULLANGUEGODE RUBBER & PRODUCE CO. LTD. VS. ST ATE OF KERALA 91 ITR 18 (SUPREME COURT) (X) JAIN TRADING CO. V/S ITO (2007) 17 SOT 574 (MUM) 5. ON THE OTHER HAND, THE LD DR HAS RELIED ON THE O RDERS OF THE AUTHORITIES BELOW. 6. WE HAVE HEARD BOTH THE SIDES ON THIS ISSUE AND A LSO PERUSED THE MATERIAL AVAILABLE ON THE RECORD. WE HAVE ALSO GONE THROUGH THE CASE LAWS RELIED UPON. AFTER HEARING BOTH THE SIDES AND C ONSIDERING THE FACTUAL ASPECT OF THE ISSUE, WE HOLD THAT AT THIS STAGE, THE CREDIBILITY OF THE ENTRIES IN THE NOTE BOOK ON THE BASIS OF WHICH THE A SSESSEE HIMSELF HAS SURRENDERED THE INCOME IN HIS OWN HAND AND ALSO IN H IS WIFE SMT. KUSUM CHOUDHARYS HAND AMOUNTING OF RS. 2,64,20,000/- AND RS. 2,77,40,000/- RESPECTIVELY, CANNOT BE HELD TO BE FABRICATED OR NO N-GENUINE. HOWEVER, THERE ARE MULTIPLE ENTRIES OF THE SAME AMOUNT ON TH E SAME DATE IN SAME NAME. AGAINST CERTAIN ENTRIES NO NAME HAS BEEN MENT IONED. APPARENTLY THE ADDITION HAS BEEN MADE FOR THE SAME AMOUNT DUE TO MULTIPLE ENTRIES OF THE SAME AMOUNT ON THE SAME DATE IN SAME NAME. O N 19/08/2013 THERE ARE FOUR ENTRIES OF RS. 11.00 LACS EACH IN SA ME NAME ADG. SIMILARLY ITA 868/JP/2017_ PRADEEP KR. CHOUDHARY VS DCIT 7 ON 09/09/2013, THERE ARE TWO ENTRIES OF RS. 21.00 LA CS EACH. THUS, THERE ARE ADDITIONS FOR THE SAME AMOUNT. THEREFORE, THE BE NCH IS OF THE VIEW THAT THE ADDITION FOR REPEATED ENTRIES IS NOT JUSTI FIED. HENCE, THE ASSESSEE GETS BENEFIT TO THE EXTENT THE ADDITION HAS BEEN MA DE ON THE BASIS OF REPEATED ENTRIES AND THE BALANCE IS SUSTAINED. 7. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS PAR TLY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 05/3/2018. SD/- SD/- FOT; IKY JKO HKKXPAN (VIJAY PAL RAO) (BHAGCHAND) U;KF;D LNL;@ JUDICIAL MEMBER YS[KK LNL;@ ACCOUNTANT MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 05 TH MARCH, 2018 *RANJAN VKNS'K DH IZFRFYFI VXZSFKR @ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ @ THE APPELLANT- SHRI PRADEEP KR. CHOUDHARY, KISHANGARH. 2. IZR;FKHZ @ THE RESPONDENT- THE D.C.I.T., CIRCLE-1, AJMER. 3. VK;DJ VK;QDR @ CIT 4. VK;DJ VK;QDRVIHY @ THE CIT(A) 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ @ DR, ITAT, JAIPUR 6. XKMZ QKBZY @ GUARD FILE (ITA NO. 868/JP/2017) VKNS'KKUQLKJ @ BY ORDER, LGK;D IATHDKJ @ ASST. REGISTRAR