Ajay A Bafna, Pune V. Assistant Commissioner of Income-tax,

ITA 91/PUN/2014

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 2657 (ITAT-PUNE)
• Duration Of Justice: 2 year(s) 1 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-03-2016
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: B
• Next Hearing Date: 19-11-2015
• Assessment Year: 2007-2008
• Appeal Filed On: 13-01-2014
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: HITENDRA NINAWE
• Keywords: Unexplained cash credit; Business income; Income from undisclosed sources; Search and seizure; Document seized; Documents seized
• Section: 143(3); 153A; 131; 132; 139; 92

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH B , PUNE , , BEFORE MS. SUSHMA CHOWLA, JM AND SHRI PRADIP KUMAR KEDIA , AM . / ITA NO S . 9 1, 92 & 9 3 /PN/20 1 4 / ASSESSMENT YEAR S : 200 7 - 0 8 , 200 8 - 09 & 20 1 0 - 11 MR. AJAY A BAFNA, MR. AJAY A BAFNA, 768/10, BAFNA FAMILY HOUSE, (DAKALE NIWAS), NEAR PYC GROUND, DECCAN GYMKHANA, PUNE 411004 . / APPELLANT PAN: AFDPB4595D VS. THE ASST. COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE 2(2), PUNE . / RESPONDENT CENTRAL CIRCLE 2(2), PUNE . / RESPONDENT / APPELLANT BY : SHRI DHARMESH SHAH / RESPONDENT BY : SHRI HITENDRA NINAWE / DA TE OF HEARING : 15 . 1 2 .2015 / DATE OF PRONOUNCEMENT: 10 . 0 3 .201 6 / / ORDER PER SUSHMA CHOWLA, JM: ALL THE APPEAL S FILED BY THE ASSESSEE ARE AGAINST CONSOLIDATED ORDER OF CIT (A) - CENTRAL, PUNE , DATED 2 1 . 11 .201 3 RELATING TO ASSESSMENT YEAR S 200 7 - 0 8, 2008 - 09 AND 20 1 0 - 1 1 AGAINST RESPECTIVE ORDER S PASSED UNDER SECTION 143(3) R.W.S. 153A OF THE INCOME TAX ACT, 1961 (IN SHORT THE ACT) . ITA NO S. 91 TO 93 /PN/201 4 MR. AJAY A. BAFNA 2 2. ALL THE APPEALS RELATE TO THE SAME ASSESSEE ON SIMILAR ISSUES WERE HEARD TOGETHER AND ARE BEING DISPOSED OF BY THIS CONSOLIDATED ORDER FOR THE SAKE OF CONVENIENCE. 3. THE ASSESSEE IN ITA NO. 9 1/PN/201 4 HAS RAISED THE FOLLOWING GROUNDS OF APPEAL: - 1 . THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED IN LAW AND IN FACTS IN NOT AP PRECIATING THAT THE ASSESSMENT ORDER PASSED BY THE ASSESSING OFFICER U/S 143(3) R.W.S. 153A OF THE ACT WAS BAD IN LAW AND INVALID. 2. THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED IN LAW AND IN FACTS IN CONFIRMING THE ADDITIONS MADE BY THE AS SESSING OFFICER ON ACCOUNT OF THE UNEXPLAINED CASH CREDIT IN THE MAURITIUS BANK ACCOUNT AMOUNTING TO RS.14,93,773/ - . 3. THE APPELLANT CRAVES LEAVE OF YOUR HONOUR TO ADD, ALTER, AMEND AND/OR DELETE ALL OR ANY OF THE FOREGOING GROUNDS OF APPEAL. 4. THE LEA RNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE POINTED OUT THAT THE GROUNDS OF APPEAL NO.1 RAISED BY THE ASSESSEE IS NOT PRESSED, HENCE, THE SAME IS DISMISSED AS NOT PRESSED. THE ISSUE IN GROUND OF APPEAL NO.2 RAISED BY THE ASSESSEE IS AGAINST THE ADDITI ON MADE ON ACCOUNT OF UNEXPLAINED CASH CREDIT IN MAURITIUS BANK ACCOUNT AMOUNTING TO RS.14,93,773/ - . 5. BRIEFLY, IN THE FACTS OF THE PRESENT CASE, SEARCH UNDER SECTION 132 OF THE ACT WAS CONDUCTED AT THE RESIDENTIAL PREMISES OF THE ASSESSEE ON 16.02.2010 . THE ASSESSING OFFICER ISSUED NOTICE TO THE ASSESSEE UNDER SECTION 153A OF THE ACT ON 18.08.2010 . IN RESPONSE THERETO, THE ASSESSEE FILED RETURN OF INCOME ON 17.01.2011 DECLARING TOTAL INCOME OF RS.10,09,901/ - . DURING THE COURSE OF SCRUTINY ASSESSMENT, THE COUNSEL FOR THE ASSESSEE ATTENDED AND FURNISHED VARIOUS DETAILS. SUMMONS UNDER SECTION 131 OF THE ACT WERE ISSUED TO THE ASSESSEE. HOWEVER, THE ASSESSEE DID NOT ATTEND THE ITA NO S. 91 TO 93 /PN/201 4 MR. AJAY A. BAFNA 3 SCRUTINY PROCEEDINGS. THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE SUBMITTED A LETTER IN RESPONSE TO SUMMONS ISSUED, POINTING OUT THAT THERE WAS THREAT TO THE LIFE OF ASSESSEE AND NON - BAILABLE WARRANT WAS ISSUED IN HIS NAME. IT WAS FURTHER STATED BY HIM THAT THE ASSESSEE WAS NOT MEETING THEM OR HIS FAMILY ON ACCOUNT OF T HIS AND THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE CLAIMED THAT THEY WOULD COMPLY WITH ALL INFORMATION BY TAKING HELP OF HIS WIFE TO THE EXTENT POSSIBLE. THE ASSESSING OFFICER THEREAFTER, COMPLETED THE ASSESSMENT ON THE BASIS OF SUBMISSIONS MA DE BY THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE AS WELL AS DOCUMENTS SEIZED IN THE MATTER. THE ASSESSING OFFICER NOTED THAT THE ASSESSEE HAD NOT FILED REGULAR RETURN OF INCOME UNDER SECTION 139 (1) OF THE ACT PRIOR TO SEARCH PROCEEDINGS. DURI NG THE COURSE OF SEARCH ACTION, STATEMENT OF ACCOUNT WITH THE MAURITIUS CO MMERCIAL BANK LTD., (QUATRE BORNES) IN THE NAME OF AJAY JAIN WAS FOUND. SUBSEQUENTLY, THE SAID ACCOUNT WAS OWNED UP BY SHRI AJAY BAFNA VIDE SUBMISSION S DATED 13.04.2010 . THE LEARNE D AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE DURING THE COURSE OF ASSESSMENT PROCEEDINGS SUBMITTED THAT THE SAID ASSESSEE DURING THE COURSE OF ASSESSMENT PROCEEDINGS SUBMITTED THAT THE SAID DOCUMENT WAS A COPY OF BANK STATEMENT FOR THE MONTH OF JANUARY, 2010 OF MR. AJAY AMOLKH JAIN WITH THE SAID BANK HAVING BALANCE OF EURO 29,831.9 7 . AS PER THE STATEMENT, THE BALANCE BROUGHT FORWARD WAS AT EURO 29,831.97 AS ON 31.01.2010. THE DETAILS OF CREDIT I N THE ACCOUNT ARE REPRODUCED AT PAGE 3 OF THE ASSESSMENT ORDER . THE ASSESSEE WAS ASKED TO EXPLAIN AS TO WHY THE AMOUNT CREDITED IN THE AB OVE ACCOUNT SHOULD NOT BE CONSIDERED AS HIS INCOME. IN REPLY, THE ASSESSEE POINTED OUT THAT MR. HITENDRANATH BEEGOO ALIAS MR. AJAY BEEGOO WAS OWNING UP THE INCOME RECEIVED IN THE ACCOUNT OF MR. AJAY BAFNA. AN AMOUNT OF EURO 20,000 WAS DEPOSITED IN THE BA NK ON 03.11.2006 AND THE CONFIRMATION WOULD BE SUBMITTED IN SHORT TIME. THE ASSESSING OFFICER AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE OBSERVED THAT AS REGARDS THE QUESTION THAT HOW THESE PAPERS RELATE TO AJAY BAFNA I.E. THE ASSESSEE , WAS CLEAR F ROM THE FACT THAT THE PAPERS WERE FOUND IN THE COMPUTER OF THE ASSESSEE. THE ASSESSING ITA NO S. 91 TO 93 /PN/201 4 MR. AJAY A. BAFNA 4 OFFICER FURTHER NOTED THAT THE SAID PAPERS WERE FOUND DURING THE COURSE OF SEARCH IN THE CASE OF ASSESSEE AS WELL AS IN THE CASE OF SHRI MADHU KODA AND OTHERS AND IT WA S ALSO FOUND THAT THE ASSESSEE WAS CLOSE ASSOCIATE OF SHRI MADHU KODA AND OTHERS. THE ASSESSING OFFICER ALSO NOTED THAT THE ASSESSEE HAS VISITED RANCHI SEVERAL TIMES BY CHARTERED FLIGHTS, WHICH WERE PROVIDED THROUGH M /S. SHAKTI AVIATIONS, A DELHI BASED CO MPANY. FURTHER, THE ASSESSEE WAS INSTRUMENTAL IN INVESTING MONEY OF SHRI MADHU KODA AND BINOD SINHA AT PUNE AND BANGALORE THROUGH HIS FRIEND ANIL BASTAWADE. DURING THE COURSE OF SEARCH, FROM THE COMPUTER OF THE ASSESSEE, INFORMATION RELATING TO MULTIPLE ACCOUNTS IN FOREIGN COUNTRIES WERE FOUND. THE SAME HAD BEEN FORWARDED TO FTD WING OF THE CBDT , REPLY OF WHICH WAS AWAITED. THE ASSESSING OFFICER WAS OF THE VIEW THAT, THEREFORE, THE ONUS WAS UPON THE ASSESSEE TO PROVE THAT THE MONEY DEPOSIT ED IN THE BANK ACCOUNTS AS FOUND ON HIS COMPUTER DOES NOT BELONG TO HIM . AS PER THE ASSESSING OFFICER, THE ASSESSEE HAD NOT BEEN ABLE TO EXPLAIN THE SAME SATISFACTORILY. THEREFORE, AS PER THE PROVISIONS OF SECTION 132(4A) OF THE ACT, PRESUMPTION IS THAT THE ENTRIES IN THE PAPERS BELONGED TO THE ASSESSEE. FURTHER, WITH PRESUMPTION IS THAT THE ENTRIES IN THE PAPERS BELONGED TO THE ASSESSEE. FURTHER, WITH REGARD TO THE OTHER CONTENTIONS MADE BY THE ASSESSEE, SINCE NO DOCUMENTARY EVIDENCE I N SUPPORT THEREOF, WAS PRODUCED, MERE GIVING PAPERS FOR ESTABLISHING THE IDENTITY OF A PERSON, AS PER THE ASSESSING OF FICER DID NOT ABSOLVE THE ASSESSEE FROM HIS RESPONSIBILITY. THEREFORE, THE ASSESSING OFFICER HELD THAT THE SAID AMOUNT WAS THE INCOME OF ASSESSEE. DURING THE YEAR IN THE SAID ACCOUNT, THERE WAS CREDIT OF EURO 26000 EQUIVALENT TO RS.14,78,360/ - AND INTERE ST OF EURO 268.43 EQUIVALENT TO RS.15,413/ - , WHICH WAS CONSIDERED AS INCOME OF THE ASSESSEE AND ADDED TO THE COMPUTATION OF INCOME. THE TOTAL ADDITION WAS MADE AT RS. 14,93,773/ - . OTHER ADDITIONS WERE ALSO MADE IN THE HANDS OF ASSESSEE, WHICH HAVE BEEN DE LETED BY THE CIT(A), AGAINST WHICH THE REVENUE IS NOT IN APPEAL AND HENCE, WE PROCEED TO DECIDE THE ISSUE OF DEPOSIT IN THE MAURITIUS BANK ACCOUNT TOTALING RS. 14,93,773/ - . ITA NO S. 91 TO 93 /PN/201 4 MR. AJAY A. BAFNA 5 6. BEFORE THE CIT(A), THE ASSESSEE HAD FILED APPEALS RELATING TO ASSESSMENT YEARS 2004 - 05 TO 2007 - 08 . W ITH REGARD TO THE DEPOSIT IN THE MAURITIUS BANK ACCOUNT, THE FIRST DEPOSIT WAS MADE ON 12.09.2003 I.E. IN ASSESSMENT YEAR 2004 - 05 OF EURO 2000 EQUIVALENT TO 1,03,560/ - . THE NEXT DEPOSIT WAS ON 03.11.2006 RELATING TO ASSESSMENT YEAR 2007 - 08 OF EURO 26000 EQUIVALENT TO RS. 14,78,360/ - . FURTHER, THE INTEREST WAS CREDITED TO THE SAID ACCOUNT OF EURO 268.43 EQUIVALENT TO RS.15,413/ - . SIMILARLY, IN ASSESSMENT YEAR 2008 - 09, THERE WAS CREDIT OF EURO 801.08 EQUIVALENT TO RS.50,668/ - AND IN A SSESSMENT YEAR 2009 - 10, CREDIT OF EURO 834.88 EQUIVALENT TO RS. 56,263/ - . THE TOTAL AMOUNT DEPOSITED IN THE SAID MAURITIUS BANK ACCOUNT WAS RS. 17,04,264/ - . THE ASSESSING OFFICER HAD ASKED THE ASSESSEE TO EXPLAIN THE CREDITS IN THE SAID ACCOUNT AND WHY THE SAME SHOULD NOT BE CONSIDERED AS HIS INCOME. THE CLAIM OF THE ASSESSEE BEFORE THE CIT(A) WAS THAT HE HAD ALREADY MADE VOLUNTARY DISCLOSURE OF RS.10 LAKHS AT THE TIME OF FILING RETURN OF INCOME, WHICH WAS MADE TO BUY PEACE OF MIND AND COVER UP ANY DISCREP ANCIES AND IN VIEW THEREOF, NO SEPARATE ADDITION WAS CALLED FOR. THE ANY DISCREP ANCIES AND IN VIEW THEREOF, NO SEPARATE ADDITION WAS CALLED FOR. THE ASSESSING OFFICER IN THE REMAND PROCEEDINGS REJECTED THE CLAIM OF ASSESSEE IN THE ABSENCE OF ANY PROOF BEING FILED TO SHOW THAT PART OF THE INCOME DISCLOSURE OF RS.10 LAKHS WAS UTILIZED FOR PURCHASING EUROS DEPOSITED IN HIS MAURITIUS BANK ACCOUNT. THE ASSESSEE IN RESPONSE TO THE REMAND REPORT, FURTHER SUBMITTED THAT DEPOSIT OF EURO 26000 IN FINANCIAL YEAR 2006 - 07 IN THE SAID BANK ACCOUNT WAS BY ONE OF THE ASSESSEES FRIEND MR. HITENDRANA TH BEEGOO, WHO WAS MAINTAINING ACCOUNT WITH THE SAID BANK THE SAID AMOUNT WAS DEPOSITED IN ASSESSEES ACCOUNT BY MR. BEEGOO, BY MISTAKE, WHO IN TURN, HAD FILED AN AFFIDAVIT BEFORE THE ASSESSING OFFICER, WHEREIN HE CLEARLY MENTIONED THAT THE SAID AMOUNT OF EURO 26000 WAS WRONGLY DEPOSITED BY HIM IN THE BANK ACCOUNT OF THE ASSESSEE. MR. BEEGOO FURTHER STATED IN THE AFFIDAVIT THAT THE SAID AMOUNT REPRESENTED THE BUSINESS FUNDS AND IN ORDER TO ESTABLISH THE IDENTITY OF THE SAID PERSON, COPY OF PASSPORT WAS FU RNISHED BEFORE THE ASSESSING OFFICER. THE GRIEVANCE OF THE ITA NO S. 91 TO 93 /PN/201 4 MR. AJAY A. BAFNA 6 ASSESSEE IN THIS REGARD WAS THAT THE ASSESSING OFFICER HAD MADE THE ADDITION BY IGNORING THE ABOVE SAID EVIDENCE , BY WHICH THE ASSESSEE HAD ESTABLISHED THE IDENTITY OF THE PERSON, WHO HAD DEPOSITE D THE FUNDS IN ASSESSEES BANK ACCOUNT AND ALSO HIS CAPACITY TO DEPOSIT THE SAID FUNDS AND THE G ENUINENESS OF THE FACT THAT THE FUNDS WERE DEPOSITED BY MR. BEEGOO AND NOT BY THE ASSESSEE. THE CIT(A) VIDE PARA 8.7 WHILE DECIDING THE GROUNDS OF APPEAL RELAT ING TO ASSESSMENT YEAR 2004 - 05 NOTED THAT THERE WAS DEPOSIT OF EURO 2000 ON 12.09.2003 , WHICH HAS NOT BEEN DISOWNED BY THE ASSESSEE. THE CONTENTION OF THE ASSESSEE IN THIS REGARD WAS THAT SINCE HE HAD MADE DISCLOSURE OF RS.10 LAKHS, NO SEPARATE ADDITION W AS CALLED FOR , AS AGAINST WHICH, THE ASSESSING OFFICER WAS OF THE VIEW THAT WHERE THE ASSESSEE HAS FAILED TO GIVE THE PROOF TO SHOW THAT PART OF THE DISCLOSED INCOME OF RS.10 LAKHS WAS UTILIZED FOR PURCHASING EUROS DEPOSITED IN THE MAURITIUS BANK ACCOUNT, THE SAME WAS NOT ACCEPTED. THE CIT(A) NOTED THAT THE DISCLOSURE WAS MADE BY THE ASSESSEE IN ORDER TO COVER UP ANY DISCREPANCIES ARISING OUT OF THE SEIZED DOCUMENTS REPRESENTING UNDISCLOSED ACTIVITY OR UNDISCLOSED INCOME. IN SUCH SITUATION , THE CIT(A) HEL D THAT THE PRESUMPTION WAS THAT UNDISCLOSED INCOME. IN SUCH SITUATION , THE CIT(A) HEL D THAT THE PRESUMPTION WAS THAT DEPOSIT OF RS. 1,03,560/ - WAS PART AND PARCEL OF THE SAID DISCLOSURE OF RS.10 LAKHS, UNLESS THE SAID AMOUNT WAS ALREADY CONSUMED BY OTHER DISCLOSED INCOME , EITHER ADMITTED BY THE ASSESSEE OR UNEARTHED BY THE DEPARTMENT. IN T HE ABSENCE OF ANY SUCH INFORMATION, THE ADDITION OF RS.1,03,560/ - MADE IN ASSESSMENT YEAR 2004 - 05 WAS DELETED. 7. WHILE ADD RESSING THE GROUNDS OF APPEAL RELATING TO ASSESSMENT YEAR 2007 - 08 WITH REGARD TO ADDITION OF RS. 14,93,773/ - , REFERENCE WAS MADE BY THE CIT(A) TO THE CONTENTIONS AND ARGUMENTS RAISED BY THE ASSESSEE, CONTENTS OF ASSESSING OFFICER S REMAND REPORT AND HIS ORDER WHILE DECIDING THE GROUND OF APPEAL NO.4 FOR ASSESSMENT YEAR 2004 - 05 . THE CIT(A) VIDE PARA 30.3 NOTED THE ARGUMENTS OF THE ASS ESSEE THAT SUM OF EURO 26000 WAS DEPOSITED BY SHRI AJAY BEEGOO, WHO WAS ALSO MAINTAINING AN ACCOUNT IN THE SAME BANK AND REFERENCE WAS MADE TO THE AFFIDAVIT FILED BY SHRI AJAY ITA NO S. 91 TO 93 /PN/201 4 MR. AJAY A. BAFNA 7 BEEGOO AND OTHER DOCUMENTARY EVIDENCE. THE CIT(A) VIDE PARA 30.4 AT PAGE 34 OF THE APPELLATE ORDER HOLDS THAT AT THE FIRST LOOK, THE ARGUMENTS ADVANCED BY THE ASSESSEE CERTAINLY LOOK CONVINCING. HOWEVER, THE CIT(A) FURTHER POINTED OUT THAT IT IS NOTEWORTHY THAT THE AMOUNT IN QUESTION (EURO 26,000) WAS NOT DEPOSITED BY SHRI AJAY BEEG OO BUT WAS A REMITTANCE FROM A PARTY BY THE NAME MAMMOET (S) PTE. LTD. INFORMATION AVAILABLE ONLINE POINTED OUT THE AFORESAID COMPANY WAS A SINGAPORE ENTITY , WHICH WAS PART OF A LARGE MNC AND THERE WAS NO RECORD TO SHOW ANY LINKS OR TRANSACTIONS BETWEEN THE ASSESSEE AND THE SAID COMPANY . AS PER DOCUMENTS ON RECORD, THE TRANSACTION OF ONE - OFF NATURE WITH NO OTHER TRANSACTIONS BETWEEN THE TWO PARTIES EITHER BEFORE OR AFTER THE SAID CREDIT OF EURO 26000 . THE CIT(A) FURTHER OBSERVED THAT THE VERSION PUT FO RWARD BY THE ASSESSEE THAT THE AMOUNT HAS BEEN DEPOSITED BY SHRI BEEGOO APPEARS QUITE I M PROBABLE. FURTHER, THE CIT(A) HELD THAT IT IS DIFFICULT TO SEE HOW OR WHY ANY PERSON, ESPECIALLY A BUSINESSMAN LIKE MR. BEEGOO WHO WOULD BE REGULARLY USING HIS BANK AC COUNTS FOR HIS BUSINESS TRANSACTIONS, WOULD MISTAKENLY CONVEY ANOTHER PERSONS BANK ACCOUNT INSTEAD OF HIS OWN. MOREOVER, IN ORDER FOR A WIRE - TRANSFER TO BE EXECUTED BANK ACCOUNT INSTEAD OF HIS OWN. MOREOVER, IN ORDER FOR A WIRE - TRANSFER TO BE EXECUTED SUCCESSFULLY, THE ACCOUNT NUMBER AND THE NAME OF THE PAYEE HAVE TO MATCH. NOTWITHSTAND ING THESE FA CT S, AND ASSUMING FOR THE SAKE OF ARGUMENT THAT THE AMOUNT WAS INDEED DEPOSITED IN THE APPELLANTS ACCOUNT INSTEAD OF MR. BEEGOOS BY MISTAKE, IT HAS NOT BEEN EXPLAINED HOW OR WHY THE MISTAKE WAS NOT DETECTED EITHER BY THE APPELLANT OR BY MR. BEEGOO FOR SO MANY YEARS, OR WHY THE AMOUNT WAS NEITHER VOLUNTARILY RETURNED BY THE APPELLANT NOR CLAIMED BACK BY MR. BEEGOO. IN FACT, IT IS NOT EVEN CLEAR FROM THE FACTS PRESENTED BY THE APPELLANT WHY HE OPENED THE BANK ACCOUNT IN MAURITIUS IN THE FIRST PLACE, AND THAT TOO, IN THE BRANCH LOCATED IN THE AREA WHERE MR. BEEGOO RESIDES. IT IS QUITE POSSIBLE THAT THE ACCOUNT WAS OPENED IN ANTICIPATION OF OR BECAUSE OF AN EXISTING BUSINESS RELATIONSHIP WITH MR. BEEGOO AND THE AMOUNT CREDITED IN THE APPELLANT S ACCOUNT WAS IN THE NATURE OF BUSINESS RECEIPT IN THE APPELLANTS HANDS. IN ANY CASE, SINCE THE BANK ACCOUNT IN THIS CASE (UNLIKE THE ACCOUNT IN CANADA) ITA NO S. 91 TO 93 /PN/201 4 MR. AJAY A. BAFNA 8 STOOD IN THE NAME OF THE APPELLANT, IT WAS FOR THE APPELLANT TO EXPLAIN TO THE SATISFACTION OF THE AO THE NATURE OF THE TRANSACTION WITH CONVINCING PROOF. THOUGH AN EXPLANATION HAS DOUBTLESSLY BEEN ADVANCED BY THE APPELLANT, FOR THE ALL THE REASONS DISCUSSED ABOVE, THE SAME FAILS TO PASS THE TEST OF PREPONDERANCE OF PROBABILITY. AS SUCH, I DO NOT SEE AN Y REASON TO INTERFERE WITH THE ORDER OF THE AO AS REGARDS THE ADDITION IN QUESTION AND, THEREFORE, THIS GROUND OF APPEAL IS HEREBY DISMISSED. 8. THE ASSESSEE IS IN APPEAL AGAINST THE AFORESAID OBSERVATIONS OF CIT(A). 9. THE LEARNED AUTHORIZED REPRESENT ATIVE FOR THE ASSESSEE POINTED OUT THAT THE ASSESSEE HAD OWNED UP A BANK ACCOUNT DURING THE COURSE OF SEARCH, WHICH WAS IN THE NAME OF SHRI AJAY JAIN . IT WAS FURTHER POINTED OUT BY HIM THAT THE AMOUNT WAS DEPOSITED BY MR. AJAY BEEGOO BY MISTAKE. THE LEAR NED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE FURTHER SUBMITTED THAT THE SAID ACCOUNT WAS FOUND AND THE ASSESSEE WAS NOT AWARE OF DEPOSIT IN HIS BANK ACCOUNT. FURTHER, THE CONTENTION OF THE LEARNED NOT AWARE OF DEPOSIT IN HIS BANK ACCOUNT. FURTHER, THE CONTENTION OF THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE WAS THAT BECA USE OF SIMILARITY IN NAME, THE AMOUNT WAS DEPOSITED IN ASSESSEES ACCOUNT AND BOTH THE ASSESSING OFFICER AND CIT(A) HAVE NOT VERIFIED HIS CLAIM. THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE FURTHER STRESSED THAT EVEN IF THE EVIDENCES PRODUCED BY THE ASSESSEE WERE NOT COMPLETE, BUT THEY WERE CONVINCING SINCE NO SEIZED MATERIAL WAS FOUND FROM THE POSSESSION OF THE ASSESSEE. OUR ATTENTION WAS DRAWN TO THE AFFIDAVIT PLACED AT PAGE 28 OF PAPER BOOK . THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSE SSEE MADE AN ALTERNATE PLEA BEFORE THE CIT(A), WHICH IS REFERRED TO IN PARA 8.2 OF THE APPELLATE ORDER, WHEREIN THE SUMMARY OF ENTRIES IN THE MAURITIUS BANK ACCOUNT ARE TABULATED. THE CIT(A) FURTHER VIDE PARA 8.7 ACCEPTS THE PLEA OF THE ASSESSEE TO ALLOW SET OFF OF DECLARATION OF RS.10 LAKHS. THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE ITA NO S. 91 TO 93 /PN/201 4 MR. AJAY A. BAFNA 9 POINTED OUT THAT THE SAID DECLARATION MADE BY THE ASSESSEE OF RS.10 LAKHS WAS TO BE ADJUSTED AGAINST THE INCOME DECLARED IN ASSESSMENT YEARS 2004 - 05 TO 2007 - 08 . 10. THE LEARNED DEPARTMENTAL REPRESENTATIVE FOR THE REVENUE IN REPLY, POINTED OUT THAT THE BANK STATEMENT OF THE MAURITIUS BANK WAS FOUND FROM THE POSSESSION OF THE ASSESSEE AND IN THE ABSENCE OF ANY EXPLANATION VIS - - VIS DEPOSITS IN THE SAID ACCOUNT , ADD ITIONS WERE MADE IN THE HANDS OF ASSESSEE. WITH REGARD TO ALTERNATE PLEA OF THE ASSESSEE, THE LEARNED DEPARTMENTAL REPRESENTATIVE FOR THE REVENUE POINTED OUT THAT THE SAME IS NOT TO BE ALLOWED AS THE AMOUNT DEPOSITED IN THE SAID BANK ACCOUNT WAS DIFFERENT AND NO SUCH DECLARATION OF DEPOSIT IN THE SAID ACCOUNT WAS MADE BY THE ASSESSEE. THE LEARNED DEPARTMENTAL REPRESENTATIVE FOR THE REVENUE FAIRLY ADMITTED THAT NO APPEAL HAS BEEN FILED AGAINST THE RELIEF GRANTED BY THE CIT(A) VIDE PARA 8.7 AT PAGE 8, UNDER WHICH THE ADDITION MADE ON ACCOUNT OF DEPOSIT OF EURO 2000 HAS BEEN DELETED BY THE CIT(A). 11. THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE FURTHER POINTED OUT THAT IN ADDITION TO THE DEPOSIT OF EURO 26000 , THERE WAS INTEREST ACCRUING TO THE AS SESSEE OF EURO 268.43 EQUIVALENT TO RS.15,413/ - . 12. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE RECORD. THE ISSUE ARISING BEFORE US VIDE GROUND OF APPEAL NO.2 IS IN RELATION TO THE ADDITION MADE ON ACCOUNT OF DEPOSITS IN THE MAURITIUS COMMERCIAL BANK ACCOUNT IN THE NAME OF MR. AJAY JAIN . THE SAID BANK ACCOUNT WAS OWNED UP BY THE ASSESSEE AS IS ALSO NOTED BY THE CIT(A) IN PARA 8.1 AT PAGE 5 OF THE APPELLATE ORDER. FURTHER, THE CIT(A) WHILE DECIDING THE OTHER ISSUE OF ADDITION OF RS. 19,74,380/ - R AISED IN ASSESSMENT YEAR 2007 - 08 , VIDE PARA 32.4 HAS GIVEN A FINDING THAT THE ASSESSEE SHRI AJAY BAFNA ALONG WITH HIS REGULAR SURNAME BAFNA WAS ALSO USING THE SURNAME JAIN . THIS FACT WAS POINTED OUT BY THE ASSESSING OFFICER AND WAS EVIDENT FROM VARIOU S PAPERS AND DOCUMENTS FOUND / SEIZED IN HIS ITA NO S. 91 TO 93 /PN/201 4 MR. AJAY A. BAFNA 10 HANDS . THE ASSESSEE HAS SUBSEQUENTLY OWNED UP THE SAID ACCOUNT. WHILE DECIDING THE APPEAL RELATING TO ASSESSMENT YEAR 2004 - 05 IN RELATION TO DEPOSIT OF EURO 2000 ON 12.09.2003, THE ASSESSEE FIRST MADE A CLAIM THAT THE SAID AMOUNT WAS DEPOSITED BY SHRI AJAY BEEGOO, BY MISTAKE IN THE BANK ACCOUNT OF THE ASSESSEE. HOWEVER, THE CIT(A) NOTED VIDE PARA 8.4 THAT THE ASSESSEE VIDE HIS SUBMISSION DATED 10.10.2013 THAT HE HAD ALREADY MADE VOLUNTARY DISCLOSURE OF RS.10 L AKHS AT THE TIME OF FILING THE RETURN OF INCOME IN ORDER TO BY PEACE OF MIND TO COVER UP ANY DISCREPANCY, THEN NO SEPARATE ADDITION OF RS.1,03,560/ - EQUIVALENT TO EURO 2000 MERITS TO BE MADE. THE CIT(A) VIDE PARA 8.7 HAS ACCEPTED THE AFORESAID PLEA OF THE ASSESSEE. 13. THE ISSUE BEFORE US IS WITH REGARD TO THE ADDITION MADE ON ACCOUNT OF DEPOSIT OF EURO 2 6000 IN THE SAID BANK ACCOUNT ITSELF ON 03.11.2006 I.E. RELATING TO ASSESSMENT YEAR 2007 - 08. THE SAID A MOUNT WAS ALSO OWNED UP BY SHRI AJAY BEEGOO TO BE BELONGING TO HIM AND IT WAS CLAIMED BY HIM THAT BY MISTAKE THE SAME WAS DEPOSIT ED IN THE BANK ACCOUNT OF THE ASSESSEE. THE CIT(A) VIDE PARAS 30.4 AND 30.5 HAS MET WITH THE BANK ACCOUNT OF THE ASSESSEE. THE CIT(A) VIDE PARAS 30.4 AND 30.5 HAS MET WITH THE SUBMISSIONS OF THE ASSESSEE IN THIS REGARD AND W E FIND NO MERIT IN THE CLAIM OF THE ASSESSEE THAT THE SAID AMOUNT OF EURO 26000 WAS DEPOSITED BY SHRI AJAY BEEGOO AND DOES NOT BELONG TO HIM. AS PER THE FINDINGS OF CIT(A), THE AMOUNT WAS DEPOSITED BY WAY OF REMITTANCE FROM A DIFFERENT COMPANY WHICH WAS SINGAPORE BASED ENTITY AND THERE IS NO MERIT IN THE CLAIM MADE BY THE ASSESSEE IN THIS REGARD, IN THE ABSENCE OF PROPER EVIDENCE HAVING BEEN FILED TO ESTABLISH ITS CLAIM. 14. BEFORE US , THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE HAS MADE AN ALTERNATE PLEA THAT THE SAID ADDI TION BE ADJUSTED AGAINST THE ADDITIONAL INCOME OF RS.10 LAKHS OFFERED BY THE ASSESSEE IN ORDER TO BY PEACE OF MIND AND COVER UP ANY DISCREPANCY IN THE PAPERS FOUND DURING THE COURSE OF SEARCH. THOUGH THE LEARNED DEPARTMENTAL REPRESENTATIVE FOR THE REVENUE HAS STRONGLY OBJECTED TO THE SAID PLEA OF ITA NO S. 91 TO 93 /PN/201 4 MR. AJAY A. BAFNA 11 THE ASSESSEE, BUT WE FIND MERIT IN THE AFORESAID PLEA OF ASSESSEE THAT WHERE ADDITIONAL INCOME IS BEING ADDED TO THE INCOME OF ASSESSEE, THEN CREDIT FOR THE AMOUNT OFFERED BY WAY OF ADDITIONAL INCOME, WHILE RECORD ING THE STATEMENT UNDER SECTION 132(4) OF THE ACT SHOULD BE ALLOWED TO THE ASSESSEE. ANOTHER ASPECT TO BE NOTED IN THIS REGARD IS THAT THE CIT(A) VIDE PARA 8.7 AT PAGE 8 HAS ALSO ALLOWED THE SAID ADDITION OF EURO 2000 EQUIVALENT TO RS.1,03,560/ - TO BE ADJ USTED OUT OF ADDITIONAL INCOME OFFERED OF RS. 10 LAKHS. THE REVENUE IS NOT IN APPEAL AGAINST THE SAID FINDING OF CIT(A). IN THE ENTIRETY OF THE ABOVE SAID FACTS AND CIRCUMSTANCES, WE DIRECT THE ASSESSING OFFICER TO ALLOW THE CREDIT OF THE BALANCE OF RS.10 LAKHS AGAINST THE ADDITION MADE ON ACCOUNT OF EURO 26000 I.E. RS. 14,78,360/ - AND BALANCE AMOUNT IS TO BE ADDED IN THE HANDS OF ASSESSEE . HOWEVER, SINCE THE BANK ACCOUNT RELATES TO THE ASSESSEE, WE UPHOLD THE ADDITION MADE ON ACCOUNT OF INTEREST CREDITED TO THE BANK ACCOUNT OF EURO 268.43 EQUIVALENT TO RS.15,413/ - . THE GROUND OF APPEAL NO.2 RAISED BY THE ASSESSEE IS THUS, PARTLY ALLOWED. 15. THE ASSESSEE IN ITA NO. 9 2 /PN/201 4 HAS RAISED THE FOLLOWING GROUNDS OF APPEAL: - 1. THE LEARNED COMMISSIONER OF IN COME - TAX (APPEALS) HAS ERRED IN LAW AND IN FACTS IN CONFIRMING THE ADDITIONS MADE BY THE ASSESSING OFFICER ON ACCOUNT OF THE 2. THE LEARNED COMMISSIONER OF INCOME - TAX (APPEALS) HAS ERRED IN LAW AND IN FACTS IN CONFIRMING THE ADDITIONS MADE BY THE ASSESSI NG OFFICER ON ACCOUNT OF THE BANDRA HOME AMOUNTING TO RS.68,00,000/ - ON PROTECTIVE BASIS AND RS . 20,00,000/ - ON SUBSTANTIVE BASIS. 3. THE LEARNED COMMISSIONER OF INCOME - TAX (APPEALS) HAS ERRED IN LAW AND IN FACTS IN CONFIRMING THE ADDITIONS MADE BY THE AS SESSING OFFICER ON ACCOUNT OF THE UNEXPLAINED CASH CREDIT IN THE MAURITIUS BANK ACCOUNT AMOUNTING TO RS.50,668/ - 4. THE LEARNED COMMISSIONER OF INCOME - TAX (APPEALS) HAS ERRED IN LAW AND IN FACTS IN CONFIRMING THE ADDITIONS MADE BY THE ASSESSING OFFICER O N ACCOUNT OF THE ENTRY MADE IN THE COMPUTER IN THE NAME OF THE KOHINOOR'S ACCOUNT AMOUNTING TO RS 47,00,000/ - 5. THE APPELLANT CRAVES LEAVE OF YOUR HONOUR TO ADD, ALTER, AMEND AND/OR DELETE ALL OR ANY OF THE FOREGOING GROUNDS OF APPEAL. ITA NO S. 91 TO 93 /PN/201 4 MR. AJAY A. BAFNA 12 16. THE GROUND O F APPEAL NO.1 RAISED BY THE ASSESSEE IS GENERAL AND HENCE, THE SAME IS DISMISSED. FURTHER, THE GROUND OF APPEAL NO.3 IS WITH REGARD TO THE ADDITION ON ACCOUNT OF CREDIT OF BANK INTEREST IN THE MAURITIUS BANK ACCOUNT AMOUNTING TO RS. 50,668/ - IS NOT PRESSED , HENCE, THE SAME IS ALSO DISMISSED AS NOT PRESSED. 17. NOW, COMING TO THE ISSUE IN GROUND OF APPEAL NO.2. THE ASSESSEE IS AGGRIEVED BY THE ORDER S OF AUTHORITIES BELOW IN MAKING AN ADDITION ON ACCOUNT OF BANDRA HOME AMOUNTING TO RS.68,00,000/ - ON PROTECT IVE BASIS AND RS.20,00,000/ - ON SUBSTANTIVE BASIS. 18. THE ASSESSING OFFICER DURING THE COURSE OF ASSESSMENT PROCEEDINGS CONSIDERED THE DOCUMENT WHICH IS ATTACHED WITH THE PUBLIC INTEREST LITIGATION PETITION (PIL) NO. 47 00 /2008, WHICH WAS FILED BEFORE TH E HONBLE HIGH COURT OF JHARKHAND BY ONE SHRI DURGA ORAON ALLEGING CORRUPT PRACTICES BY SHRI MADHU KODA AND OTHERS. THROUGH THE DURGA ORAON ALLEGING CORRUPT PRACTICES BY SHRI MADHU KODA AND OTHERS. THROUGH THE AFFIDAVIT, THE HONBLE COURT WAS REQUESTED TO DIRECT THE CENTRAL BUREAU OF INVESTIGATION (CBI) TO CONDUCT AN ENQUIRY AGAINST AC CUMULATION OF DISPROPORTIONATE ASSETS BY NUMBER OF PERSONS, WHO WERE MINISTERS IN THE ERSTWHILE STATE GOVERNMENT UNDER THE CHIEF MINISTERSHIP OF SHRI MADHU KODA. IT WAS ALLEGED THAT SHRI BINOD SINHA AND SHRI SANJAY CHOUDHARY CONNIVED WITH SHRI KODA AND AC QUIRED HUGE PROPERTIES IN INDIA AND ABROAD BY MISUSING THE OFFICIAL POSITION OF SHRI KODA. ALONG WITH THE PIL PETITION, ACCOUNT OF RECEIPTS AND PAYMENTS WAS ATTACHED AS ANNEXURE. ONE SUCH ENTRY AS PER THE ASSESSING OFFICER BELONGED TO SHRI AJAY BAFNA. THE SAID ENTRY IS REPRODUCED UNDER PARA 8 OF THE ASSESSMENT ORDER, WHICH TALKS OF ENTRIES OF BANDRA HOME AND THE NAME OF AJAY ON THE SAID DOCUMENT. THE ASSESSING OFFICER WAS OF THE VIEW THAT THE ASSESSEE HAD RECEIVED SUM OF RS.88 LAKHS AND THE ASSESSEE WAS ASKED TO EXPLAIN THE NATURE OF ENTRY. IN REPLY, THE ASSESSEE POINTED OUT THAT THIS PAPER WAS WITH THE ITA NO S. 91 TO 93 /PN/201 4 MR. AJAY A. BAFNA 13 ASSESSING OFFICER FROM PIL MADE AT RANCHI. THE ASSESSEE VEHEMENTLY STATED THAT HE HAD NO CONNECTION WITH THIS BANDRA FLAT AND FURTHER IT WAS NOT KNO WN THE BASIS, THE DEPARTMENT DRAWN PRESUMPTION THAT THE NAME OF AJAY REFERS TO THE ASSESSEE AND NO OTHER PERSON. THE ASSESSEE ASKED FOR THE INFORMATION TO BE GIVEN TO HIM IN ENTIRETY. WITHOUT PREJUDICE TO THE SAME, THE ASSESSEE ALSO FURNISHED DETAILS OF BANDRA FLAT I.E. PHOTOS OF THE BUILDING OF THE S AID BANDRA FLAT AND ITS ADDRESS , OWNER OF THAT BUILDER M/S. LALANI GROUP AND WAS BEING USED BY THEM AS GUEST HOUSE. THE CURRENT OWNER OF THE PROPERTY WAS MR. SUVAMAR, WHO IS JUDGE IN MUMBAI. THE ASSESSEE AS KED THE ASSESSING OFFICER TO VERIFY THE ABOVE FACTS AND POINTED OUT THAT THERE WAS NO RELATION BETWEEN THE FLAT AND INCOME OF ASSESSEE AND ACCORDINGLY, NO ADDITION SHOULD BE MADE. THE ASSESSEE FURTHER ALSO POINTED OUT THAT HE HAD NO COMMERCIAL RELATIONS W ITH MR. MADHU KODA AND HIS ACCOMPLICE , WHICH F ACT WAS STATED BEFORE THE INVESTIGATION DEPARTMENT AND NOW BEFORE THE ASSESSING OFFICER. THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE STRESSED THAT EVEN THE INVESTIGATION DEPARTMENT CONCLUDED THAT TH E ASSESSEE HAD NO CONNECTION WITH MR. MADHU KODA OR ANY OTHER CONCLUDED THAT TH E ASSESSEE HAD NO CONNECTION WITH MR. MADHU KODA OR ANY OTHER PERSON OR HIS ACCOMPLICE. IT WAS ALSO STRESSED BY THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE THAT EVEN DURING THE COURSE OF SURVEY UPON THE ASSESSEE, NO SUCH CONNECTING DOCUMENTS OR FIGURES LINKED WITH THE PAPERS FOUND FROM THE POSSESSION OF ASSESSEE. THE ASSESSING OFFICER REJECTING THE SUBMISSIONS OF THE ASSESSEE WAS OF THE VIEW THAT THE ENTRY IN THE EXTRACT GIVEN IN THE ASSESSMENT ORDER, CLEARLY INDICATED THAT THE ASSESSEE HAD REC EIVED SUM OF RS. 88 LAKHS TOWARDS BANDRA HOME. THE ASSESSING OFFICER FURTHER POINTED OUT THAT MAY BE THE ASSESSEE IS NOT THE OWNER OF HOUSE, HOWEVER, THE NATURE OF ENTRY AND THE NATURE OF TRANSACTION INDICATES THAT THE ASSESSEE HAD ACTED AS A BROKER FOR AR RANGING THE TRANSACTION PROBABLY FOR RENT. THE SEIZED PAPER AS PER THE ASSESSING OFFICER, INDICATED THAT OUT OF RS.88 LAKHS, RS.68 LAKHS HAD BEEN PAID AND HE HAD EARNED BROKERAGE OF RS.20 LAKHS. HOWEVER, SINCE THE ASSESSEE HAS FAILED TO SHOW THIS INCOME, SUM OF RS.20 LAKHS WAS TAXE D AS UNDISCLOSED ITA NO S. 91 TO 93 /PN/201 4 MR. AJAY A. BAFNA 14 INCOME. FURTHER, SEIZED RECORDS INDICATED PAYMENT OF RS.68 LAKHS, BUT THE PERSON TO WHOM RS.68 LAKHS WAS PAID WAS NOT IDENTIFIED, THEREFORE, THE ENTIRE SUM OF RS.88 LAKHS WAS ADDED TO THE INCOME OF ASSESSEE. H OWEVER, RS.68 LAKHS OUT OF RS.88 LAKHS WAS ADDED ON PROTECTIVE BASIS. THE ASSESSING OFFICER FURTHER OBSERVED THAT IN CASE THE ASSESSEE WAS UNAWARE OF THE TRANSACTION, HOW COULD HE LOCATE THE FLAT AS MENTIONED IN THE SAID PAGE AND IF HE WAS SO AWARE, THEN THE NAME ON PAPER AUTOMATICALLY TALLIES WITH THE NAME OF ASSESSEE AND UNDER SUCH CIRCUMSTANCES, CLEAR - CUT INFERENCE COULD BE DRAWN AS THE ASSESSEE WAS HIDING THE DETAILS. 19. THE CIT(A) VIDE PARA 41 AT PAGES 41 ONWARDS CONSIDERED THE SAID ISSUE I.E. THE OBSERVATIONS OF ASSESSING OFFICER AND EXPLANATION OF THE ASSESSEE AND CLAIM OF THE ASSESSEE THAT CONTENTS OF THE SAID DOCUMENT DID NOT PERTAIN TO HIM AND THAT THE SAID DOCUMENT HAS NO EVIDENTIARY VALUE IN THE EYES OF LAW. IT WAS STRESSED BY THE ASSESSEE THAT MERELY BECAUSE ON THE DOCUMENT NAME OF AJAY WAS MENTIONED, DOES NOT LEAD TO THE CONCLUSION THAT THE DOCUMENT REFERS TO THE ASSESSEE. HE STRESSED THAT THERE WAS THE CONCLUSION THAT THE DOCUMENT REFERS TO THE ASSESSEE. HE STRESSED THAT THERE WAS NO CONNECTION OF THE ASSESSEE WITH THE IMPUGNED TRANSACTION. HE FURTHER POINTED OUT THAT THE SAID DOCUMENT WAS FOUND ATTACHED TO PIL FILED BEFORE THE HONBLE HIGH COURT OF JHARKHAND AT RANCHI, AND WAS NOT FOUND FROM THE POSSESSION OF THE ASSESSEE AND THE ENTIRE ADDITION MADE ON ESTIMATE BASIS AND ON THE PRESUMPTION THAT THE DOCUMENT RELATES TO THE ASSESSEE, MERITS TO BE DELETED. THE ASSESSEE ALSO STRESSED THAT THERE IS NO EVIDENCE OF RECEIPT OF RS.20 LAKHS AS COMMISSION. WITH REGARD TO THE CONTENTION OF THE ASSESSING OFFICER THAT THE ASSESSEE WAS AWARE ABOUT THE DETAILS OF FLAT, THEN THE NAME MENTIONED IN THE DOCUMENT RELATES TO THE ASSESSEE, IT WAS POINTED OUT BY HIM THAT BEFORE THE ASSESSING OFFICER, A QUERY WAS RAISED AS FROM WHERE AND HOW HE GOT THOSE DOCUMENTS AND HOW DOES THE SE PAPER S RELATE TO THE ASSESSEE AND ALSO OPPORTUNITY TO CROSS - EXAMINE THE PERSON WAS ASKED. THE CIT(A) NOTED THE CONTENTS OF DOCUMENTS AND REFERENCE TO THE AMOUNT OF ADVANCE TO ONE AJAY, WHOSE FULL NAME WAS ITA NO S. 91 TO 93 /PN/201 4 MR. AJAY A. BAFNA 15 NOT MENTIONED. THE CIT(A) FURTHER REFERRED TO THE SUBMISSIONS MADE BEFORE HIM BY THE ASSESSEE ON 11.06.2013, IN WHICH AS PER CIT(A), THE ASSESSEE HAD CLEARLY RECONFIRMED HIS CONNECTION WITH THE TRANSACTION AND CATEGORICALLY ACCEPTED ACTING AS A BROKER IN RESPECT OF THIS PROPERTY. THE ASSESSEE HAD CLAIMED THAT HE WAS AWARE OF ONE FLAT AT BANDRA, IN RESPECT OF WHI CH, HE HAD ACTED AS BROKER. THE ASSESSEE CLAIMED ALTHOUGH THE TRANSACTION DID NOT MATERIALIZE AND PRESUMING THAT THE SAID DOCUMENT REFERRED TO THE SAID PROPERTY AT BANDRA, THE ASSESSEE HAS PROVIDED INFORMATION ABOUT THE SAID PROPERTY TO THE ASSESSING OFFI CER WITH AN INTENTION TO ENABLE HIM TO VERIFY THE FACTS AS REGARDS THE NATURE OF TRANSACTION, VALUE OF TRANSACTION AND NATURE OF INVOLVEMENT OF ASSESSEE. THE CIT(A) IN VIEW THEREOF AND IN VIEW OF THE SUBMISSIONS MADE BEFORE THE ASSESSING OFFICER, WAS OF T HE VIEW THAT IT CONCLUSIVELY ESTABLISHED THE PREPONDERANCE OF PROBABILITY THAT THE TRANSACTION DID TAKE PLACE AND THE AMOUNT WAS ACTUALLY PAID TO THE ASSESSEE. THE CIT(A) THUS, UPHELD THE SUBSTANTIVE ADDITION OF RS.20 LAKHS AND AS FAR AS THE PROTECTIVE AS SESSMENT OF RS.68 LAKHS WAS CONCERNED, WAS ALSO CONFIRMED BY THE CIT(A). HOW EVER, THE CIT(A) HELD THAT IN CASE THE SAID AMOUNT IS SUBSEQUENTLY THE CIT(A). HOW EVER, THE CIT(A) HELD THAT IN CASE THE SAID AMOUNT IS SUBSEQUENTLY FOUND TO HAVE CONFIRMED SUBSTANTIALLY IN THE HANDS OF ANY OTHER PERSONS, THEN THIS ORDER WOULD BE RECTIFIED SO A S TO DELETE THE SAID AMOUNT. 20. THE ASSESSEE IS IN APPEAL AGAINST THE ORDER OF CIT(A). 21. THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE BEFORE US HAS STRESSED THAT THE SAID DOCUMENT WAS ATTACHED TO ONE PIL AND WAS NOT FOUND FROM THE POSSESSION OF ASSESSEE DURING THE COURSE OF S URVEY. FURTHER, THE SAID DOCUMENT ONLY MENTIONED NAME AJAY , BUT THERE IS NO INFORMATION TO ESTABLISH THAT AJAY REFERRED IN THE SAID DOCUMENT IS THE ASSESSEE. FURTHER, REFERRING TO THE ORDER OF CIT(A), THE LEARNED AU THORIZED REPRESENTATIVE FOR THE ASSESSEE POINTED OUT THAT THE CIT(A) HAD GONE ON PREPONDERANCE OF PROBABILITY, WHEREIN THE PAGE DID NOT BELONG TO THE ITA NO S. 91 TO 93 /PN/201 4 MR. AJAY A. BAFNA 16 ASSESSEE NOR WAS THE SAME IN THE HANDWRITING OF THE ASSESSEE, NOR WAS FOUND FROM THE POSSESSION OF ASSESSE E AND FURTHER, NO EVIDENCE WAS FOUND FROM HIS POSSESSION, WITH WHOM THE TRANSACTION WAS MADE. THE ASSESSING OFFICER HAD PRESUMED T HE TRANSACTIONAL VALUE OF RS.68 LAKHS OF RENT AND ASSESSEE WAS HELD TO HAVE EARNED BROKERAGE OF RS.20 LAKHS. HE STRESSED THA T WHERE THE DOCUMENT DOES NOT BELONG TO THE ASSESSEE AND WHERE ONLY PROTECTIVE ADDITION WAS MADE BY THE ASSESSING OFFICER, WHERE THE SUBSTANTIVE ADDITION WAS NOT MADE AND THE CIT(A) MAKES PART OF IT SUBSTANTIVE AND THE BALANCE AS PROTECTIVE AND ISSUES DIR ECTIONS TO THE ASSESSING OFFICER, WHICH HAVE NOT BEEN COMPLIED WITH TILL DATE. 22. THE LEARNED DEPARTMENTAL REPRESENTATIVE FOR THE REVENUE PLACED RELIANCE ON THE ORDERS OF ASSESSING OFFICER AND CIT(A). 23. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE RECORD. SEARCH AND SEIZURE OPERATIONS WERE CARRIED OUT AT THE PREMISES OF THE ASSESSEE ON 16.02.2010. SEIZURE OPERATIONS WERE CARRIED OUT AT THE PREMISES OF THE ASSESSEE ON 16.02.2010. THE ASSESSEE WAS A REAL ESTATE AGENT AND VARIOUS DOCUMENTS WERE SEIZED FROM THE PREMISES OF THE ASSESSEE. ADMITTEDLY, WITH REGARD TO CERTAIN DOCUME NTS SEIZED FROM THE PREMISES OF THE ASSESSEE , CERTAIN ADDITIONS WERE MADE IN THE HANDS OF ASSESSEE AND O NE SUCH ADDITION WHICH HAS BEEN CONFIRMED IN THE PARAS HEREINABOVE BY US IS WITH REGARD TO ENTRIES IN MAURITIUS COMMERCIAL BANK AS UNEXPLAINED CREDITS I N THE SAID BANK. THOUGH, WE HAVE DIRECTED THE ASSESSING OFFICER TO ALLOW AN ALTERNATE PLEA OF THE ASSESSEE, BUT THE ADD ITION PERSE HAS BEEN CONFIRMED IN THE HANDS OF ASSESSEE. 24. NOW, COMING TO THE PRESENT ADDITION MADE BY THE ASSESSING OFFICER OF RS.20 LAKHS ON SUBSTANTIVE BASIS AND RS.68 LAKHS ON PROTECTIVE BASIS, THE SAME RELATES TO A PAPER WHICH WAS ATTACHED TO PIL FILED BY ONE PERSON IN THE HONBLE HIGH COURT OF JHARKHAND AT RANCH. VIDE THE SAID PETITION, THERE WAS AN ALLEGATION OF CORRUPT ITA NO S. 91 TO 93 /PN/201 4 MR. AJAY A. BAFNA 17 PRACTICE S BY SHRI MADHU KODA AND OTHERS. THERE WAS A CASE OF ACCUMULATION OF DISPROPORTIONATE ASSETS BY NUMBER OF PERSONS WHO WERE MINISTERS IN THE ERSTWHILE STATE GOVERNMENT UNDER THE CHIEF MINISTERSHIP OF SHRI MADHU KODE. THE PIL WAS MOVED IN THIS REGARD AND T HE ACCOUNTS OF RECEIPTS AND PAYMENT WERE ATTACHED AS ANNEXURES. ONE ENTRY ON ONE OF THE PAPERS FILED TALKED ABOUT BANDRA HOME WITH NAME AJAY BELOW IT. THE ASSESSING OFFICER WAS OF THE VIEW THAT THE NAME OF ASSESSEE BEFORE US I.E. AJAY BAFNA WAS MENTIONED AS AJAY ON THE SAID DOCUMENT AND CONSEQUENTLY, THE ENTRIES ON THE SAID DOCUMENTS RELATED TO THE ASSESSEE. IN VIEW THEREOF, THE ASSESSEE WAS SHOW CAUSED AS TO WHY THE ADDITION OF RS.88 LAKHS SHOULD NOT BE MADE IN THE HANDS OF ASSESSEE. THE SAID DOCUMENT IS SCANNED AND REPRODUCED UNDER PARA 8 OF THE ASSESSMENT ORDER AND IS ALSO REPRODUCED UNDER PARA 41.4 AT PAGE 42 OF THE APPELLATE ORDER. THE PERUSAL OF THE SAID DOCUMENT REFLECTS AN ENTRY OF 50.00 ON 14.11.2007 AND 38.00 ON 30.11.2007 , TOTAL 88.00, OUT OF WHICH 20.00 IS DEBITED AND THE BALANCE IS 68.00. WITH REGARD TO THE SAID ENTRY, FIRST PRESUMPTION BY THE ASSESSING OFFICER WAS THAT IT BELONGS TO THE ASSESSEE SINCE THE NAME OF AJAY WAS WRITTEN UNDER OFFICER WAS THAT IT BELONGS TO THE ASSESSEE SINCE THE NAME OF AJAY WAS WRITTEN UNDER BANDRA HOME. THE SECOND PRESUMPTION WAS THAT THE SAID ENTRIES RELATED TO THE ASSESSEE. THE EXPLANATION OF THE ASSESSEE IN THIS REGARD WAS THAT THE ABOVE SAID DOCUMENT WAS NOT FOUND FROM HIS POSSESSION AND AS SUCH, THERE IS NO PRESUMPTION UNDER SECTION 132(4) OF THE ACT THAT THE ENTRIES IN THE SAID DOCUMENT BELONGED TO THE ASSESSEE. FURTHER, IT WAS POINTED OUT BY THE ASSESSEE HIMSELF THAT THERE WAS NO CONNECTION WHATSOEVER WITH BANDRA FLAT, EXCEPT FOR AN ENQUIRY MADE IN RESPECT OF THE SAID PROPERTY AT BANDRA. THE ASSESSEE PROVIDED THE INFORMATION WITH REGAR D TO SAID PROPERTY TO THE ASSESSING OFFICER THAT IT WAS OWNED BY A BUILDER M/S. LALANI GROUP AND WAS BEING USED BY THEM AS GUEST HOUSE AND FURTHER, TH E CURRENT OWNER OF THE PROPERTY WAS MR. SUVAMAR, WHO IS JUDGE IN MUMBAI. HE ALSO ATTACHED THE PHOTOS OF T HE BUILDING OF SAID BANDRA FLAT . IN VIEW OF VARIOUS SUBMISSIONS MADE BY THE ASSESSEE, THE ASSESSING OFFICER AND THE CIT(A) QUESTIONED AS TO HOW THE ASSESSEE WAS AWARE OF ITA NO S. 91 TO 93 /PN/201 4 MR. AJAY A. BAFNA 18 THE EXACT ADDRESS OF BANDRA HOME. THE PRESUMPTION IN THIS REGARD BY BOTH THE AUTHORI TIES WAS SINCE THE ASSESSEE WAS AWARE OF SAID BANDRA FLAT , THE ENTRIES ON THE SAID DOCUMENT RELATED TO THE ASSESSEE. FURTHER, PRESUMPTION WAS THAT OUT OF RS.88 LAKHS, RENT FOR THE SAID BUILDING WAS RS.68 LAKHS AND COMMISSION EARNED BY THE ASSESSEE WAS RS. 20 LAKHS. CONSEQUENTLY, ADDITION OF RS.20 LAKHS WAS MADE ON SUBSTANTIVE BASIS AND ADDITION OF RS.68 LAKHS WAS MADE ON PROTECTIVE BASIS. 25. THE SUBSTANTIVE ADDITION IN THE HANDS OF ASSESSEE WAS BEING MADE ON ACCOUNT OF COMMISSION OF RS.20 LAKHS I.E. AL LEGING THAT THE ASSESSEE HAD ENTERED INTO S O ME KIND OF TRANSACTION RELATING TO BANDRA HOME, UNDER WHICH THE ASSESSEE EARNED COMMISSION OF RS.20 LAKHS SINCE THE ASSESSEE WAS ENGAGED IN THE BUSINESS OF REAL ESTATE . ONCE IT IS ASSUMED THAT THE ASSESSEE HAS E ARNED COMMISSION INCOME OF RS.20 LAKHS, WITHOUT CONFIRMING WHETHER SUCH ADDITION CAN BE MADE IN THE HANDS OF ASSESSEE , CONSEQUENT FACTS TO SUCH ASSUMPTION IS , HOW ADDITION CAN BE MADE ON ACCOUNT OF RENT IN THE HANDS OF ASSESSEE. ONCE THE ASSESSEE IS HELD TO BE A BROKER, ACCOUNT OF RENT IN THE HANDS OF ASSESSEE. ONCE THE ASSESSEE IS HELD TO BE A BROKER, WHO IN TURN, HAS EARNED COMMISSION OF RS.20 LAKHS ON A TRANSACTION, THE VALUE OF THE TRANSACTION CANNOT BE ADDED IN THE HANDS OF ASSESSEE AS BELONGING TO THE ASSESSEE EVEN ON PROTECTIVE BASIS. THE FIRST AND FOREMOST RULE OF MAKING ANY ADDI TION IN THE HANDS OF ASSESSEE ON THE BASIS OF ANY SEIZED DOCUMENT IS THE PARAMOUNT ESTABLISHMENT OF FACTUM THAT THE DOCUMENTS RELATE TO THE ASSESSEE. FIRST OF ALL, THE SAID DOCUMENT WAS NOT FOUND FROM THE POSSESSION OF THE ASSESSEE AND HENCE, THERE IS NO PRESUMPTION AGAINST THE ASSESSEE, IN VIEW OF THE PROVISIONS OF SECTION 292C OF THE ACT. SECONDLY, THE SAID DOCUMENT WAS ATTACHED TO PIL FILED BY A PERSON AGAINST THIRD PARTY AND THOUGH THE ASSESSEE MAY HAVE SOME CONTACTS WITH THE SAID PARTY , BUT HOW CAN THERE BE A PRESUMPTION THAT THE NAME AJAY WRITTEN UNDER BANDRA HOME IS THE ASSESSEE HIMSELF. IN THE ABSENCE OF ANY EVIDENCE FOUND THAT THE ENTRIES ON THE SAID DOCUMENT RELATES TO THE ASSESSEE BEFORE US, THERE IS NO MERIT IN ANY ADDITION IN THE ITA NO S. 91 TO 93 /PN/201 4 MR. AJAY A. BAFNA 19 HANDS OF A SSESSEE ALLEGING THAT THE COMMISSION OF RS.20 LAKHS HAS BEEN EARNED BY THE ASSESSEE. FIRST OF ALL, THE FIGURE MENTIONED ON THE SAID DOCUMENT IS 20.00 AND IN THE ABSENCE OF ASSESSING OFFICER ESTABLISHING 20.00 STANDS FOR RS.20 LAKHS, THE SAID ADDITION CANN OT BE UPHELD IN THE HANDS OF ASSESSEE. SECONDLY, THE SAID DOCUMENT HAS NOT BEEN PROVED TO RELATE TO THE ASSESSEE AND MERELY BECAUSE THE ASSESSEE HAD GIVEN CERTAIN INFORMATION ABOUT BANDRA FLAT, WHICH ADMITTEDLY IS OWNED BY ONE PERSON AND WAS BEING USED BY HIM AND WAS LATER OWNED BY SOME OTHER PERSON, WE FIND NO MERIT IN THE PRESUMPTION AND ASSUMPTIONS MADE BY THE ASSESSING OFFICER THAT THE ENTRIES IN THE DOCUMENT RELATE TO A RENTAL INCOME OF RS.68 LAKHS, AGAINST WHICH THE ASSESSEE HAS EARNED COMMISSION OF RS.20 LAKHS. THE SAID FLAT WAS BEING USED AS GUEST HOUSE AND THERE WAS NO QUESTION OF EARNING RENTAL INCOME. CONSEQUENTLY, THE OBJECTIONS AND ASSUMPTION RAISED BY BOTH THE AUTHORITIES THAT THE ASSESSEE IS AWARE OF SUCH FLAT IN BANDRA AND HENCE, THE NAME OF AJAY RELATES TO THE ASSESSEE IS BASELESS. FIRST OF ALL, BEFORE MAKING ANY ADDITION IN THE CASE OF ANY OF ASSESSEE, COMPLETE DETAILS SHOULD BE AVAILABLE. IT IS NOT EVEN CLEAR AS TO WHICH BANDRA FLAT, THE SAID PAPER RELATES AND IT IS AVAILABLE. IT IS NOT EVEN CLEAR AS TO WHICH BANDRA FLAT, THE SAID PAPER RELATES AND IT IS ALSO NOT CLEAR WHAT ARE THE ENTRIES MADE ON THAT DOCUMENT WHETHER RELATING TO SALE OF THE PROPERTY OR GIVING THE SAME ON RENT. IN THE ABSENCE OF ANY CLARITY, THE SAID DOCUMENT AT BEST IS A DUMB DOCUMENT AND ENTRIES IN THE SAID DOCUMENT ARE NOT RELATABLE TO THE ASSESSEE. BO TH THE AUTHORITIES BELOW HAVE FAILED TO ESTABLISH CONNECTION OF THE ASSESSEE WITH THE SAID DOCUMENT, WHICH IS ANNEXED TO PIL AND HAVE ALSO FAILED TO ESTABLISH THAT THE SAID ENTRIES RELATE TO THE ASSESSEE HIMSELF. IN THE ABSENCE OF THE SAME, WE FIND NO MER IT IN THE AFORESAID ADDITIONS EITHER ON PROTECTIVE AND / OR SUBSTANTIVE BASIS AND WE DELETE THE SAME. ANOTHER POINT TO BE NOTED IS THAT ONCE IF COMMISSION INCOME WAS ADDED IN THE HANDS OF ASSESSEE, THEN NO ADDITION IS WARRANTED ON ACCOUNT OF RENTAL INCOME , SINCE APPARENTLY, THE ASSESSEE WAS ONLY A BROKER AND CANNOT BE BOTH A BROKER AND OWNER IN THE SAME B REATH . WE FIND NO MERIT IN ITA NO S. 91 TO 93 /PN/201 4 MR. AJAY A. BAFNA 20 THE ORDERS OF AUTHORITIES BELOW IN THIS REGARD AND REVERSING THE SAME, WE ALLOW GROUND OF APPEAL N O .2 RAISED BY THE ASSESSEE. 2 6 . NOW, COMING TO THE ISSUE IN GROUND OF APPEAL NO.4 RAISED BY THE ASSESSEE I.E. AGAINST THE ADDITION OF RS.47 LAKHS ON ACCOUNT OF ENTRY MADE IN THE COMPUTER IN THE NAME OF KOHINOORS ACCOUNT. 2 7 . BRIEFLY, IN THE FACTS RELATING TO THE ISSUE, DURING TH E COURSE OF SEARCH IN THE BUSINESS PREMISES OF ASSESSEE, CERTAIN INFORMATION WAS COLLECTED FROM THE COMPUTER. AS PER EXCEL FILE UNDER THE HEAD FIL16, CERTAIN ENTRIES WERE FOUND AND THE ACCOUNT EXTRACT IS REPRODUCED BY THE ASSESSING OFFICER UNDER PARA 9, I N WHICH ON ONE SIDE, THERE IS CREDIT OF RS.1.38 CRORES AND THE OTHER SIDE, DEBIT OF RS.1.85 CRORES. THERE WAS A DEBIT OF CASH OF RS.1.50 CRORES TO KOHINOOR (BOM) ON 26.05.2007 . FURTHER, THERE WAS CASH DEBIT OF RS.35 LAKHS ON 30.05.2007 TO HITESH. THE AS SESSEE WAS ASKED AS TO WHY THE SAID AMOUNT SHOULD NOT BE CONSIDERED AS HIS INCOME AND TAXED ACCORDINGLY. WHY THE SAID AMOUNT SHOULD NOT BE CONSIDERED AS HIS INCOME AND TAXED ACCORDINGLY. THE ASSESSEE EXPLAINED THAT THOUGH THIS ACCOUNT WAS FOUND FROM HIS COMPUTER IN SOFT, IT WAS IN THE BOOKS OF SOMEBODY AND IT DOES NOT HAVE ASSESSEES N AME. IT MAY HAV E BEEN DOWNLOADED FROM E - MAIL AND HE FURTHER SUBMITTED THAT THE ACC OUNT IS OWNED UP BY AJAY BEEGOO AND ALSO THAT THE ASSESSEE HAD NO RELATION / CONNECTION WITH THESE TRANSACTIONS. IN SUPPORT, THE ASSESSEE FURNISHED AN AFFIDAVIT OF SHRI AJA Y BEEGOO , IN WHICH HE ADMITTED THAT COPIES OF CORRESPONDENCE AND E - MAILS PERTAIN TO HIM AND ENLISTED THE FILES IN THIS REGARD. THE ASSESSING OFFICER DID NOT ACCEPT THE EXPLANATION OF THE ASSESSEE SINCE THE EVIDENCE PRODUCED BY THE ASSESSEE WITH REFERENCE TO SHRI AJAY BEEGOO, WHO WAS AN NRI, WAS NOT VERIFIABLE. HE FURTHER NOTED THAT SHRI AJAY BEEGOO HAD NOT GIVEN THE ESSENCE OF TRANSACTION AND AFFIDAVIT IS NOT SUPPORTED BY PASSPORT DETAILS OF RELEVANT DATES. THEREFORE, THE VERIFICATION OF THE SAID TRANSAC TION AS PER THE ITA NO S. 91 TO 93 /PN/201 4 MR. AJAY A. BAFNA 21 ASSESSEE WAS NOT POSSIBLE. THE ASSESSING OFFICER FURTHER HOLDS THAT THE SAID ADDITION WOULD BE DELETED IF NECESSARY EVIDENCE WAS PRODUCED BY THE ASSESSEE. 2 8 . THE CIT(A) UPHELD THE ADDITION AS THE AFFIDAVIT OF SHRI AJAY BEEGOO DID NOT RE FER TO THE INFORMATION IN PARTICULAR AND HE ALSO DID NOT EXPLAIN THE CONNECTION WITH KRANTI GROUP. THE CIT(A) WAS OF THE VIEW THAT THE PRESUMPTION UNDER SECTION 132(4A) OF THE ACT APPLIES EQUALLY TO THE IMPUGNED DOCUMENT FOUND ON THE COMPUTER WHICH WAS KE PT AT THE PREMISES OF THE ASSESSEE AND UPHELD THE ADDITION. 2 9 . THE ASSESSEE IS IN APPEAL AGAINST THE ORDER OF CIT(A). 30 . THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE STRESSED UPON THE SUBMISSIONS MADE BEFORE AUTHORITIES BELOW AND POINTED OUT THAT FILE 16 TALKS OF TELEPHONE DETAILS AND FILE 20 TALKS OF OTHER ASPECTS AND ON THE BASIS OF THIS, ADDITION OF RS.47 LAKHS WAS MADE IN THE HANDS OF ASSESSEE. HE FURTHER SUBMITTED THAT IN ORDER TO RS.47 LAKHS WAS MADE IN THE HANDS OF ASSESSEE. HE FURTHER SUBMITTED THAT IN ORDER TO COVER UP THE DISCREPANCY, HE HAD OFFERED RS.40 LAKHS UP T O 31.03.2007 AND RS.10 LAKHS IN ASSESSMENT YEAR 2008 - 09 , BUT NO PERIOD WAS MENTIONED ANYWHERE . 3 1 . THE LEARNED DEPARTMENTAL REPRESENTATIVE FOR THE REVENUE PLACED RELIANCE ON EARLIER SUBMISSIONS MADE IN THIS REGARD. 3 2 . WE HAVE HEARD THE RIVAL CONTENTIO NS AND PERUSED THE RECORD. THE ADDITION OF RS.47 LAKHS, AGAINST WHICH THE PRESENT GROUND OF APPEAL HAS BEEN RAISED BY THE ASSESSEE RELATES TO AN ENTRY WHICH IS AMOUNT DUE FROM ACCOUNT EXTRACT FOUND ON THE COMPUTER OF ASSESSEE. THE PERUSAL OF THE SAID EXT RACT, WHICH IS REPRODUCED UNDER PARA 9 OF THE ASSESS MENT ORDER REFLECTS THAT ON CREDIT SIDE, THERE IS AN ENTRY OF US 10000 AND OTHER ENTRIES OF CASH FROM DIFFERENT PERSONS AND ON THE DEBIT SIDE, THERE IS ITA NO S. 91 TO 93 /PN/201 4 MR. AJAY A. BAFNA 22 AN ENTRY OF CASH TO KOHINOOR (BOM) OF RS.1.50 CRORES AND HITESH OF RS.35 LAKHS , AGAINST AVAILABLE CASH OF RS.1.38 CRORES AND THE BALANCE OF RS.47 LAKHS WAS ADDED AS INCOME FROM UNDISCLOSED SOURCES IN THE HANDS OF ASSESSEE. THE CASE OF REVENUE AUTHORITIES IN THIS REGARD IS THAT THE PRESUMPTION UNDER SECTION 132(4A) OF THE ACT IS AGAINST THE ASSESSEE SINCE THE ABOVE SAID ENTRIES WERE FOUND FROM AN ACCOUNT EXTRACT AVAILABLE ON THE COMPUTER OF THE ASSESSEE. THE EXPLANATION OF THE ASSESSEE ON THE OTHER HAND, WAS THAT THESE ENTRIES DID NOT BELONG TO HIM, BUT BEL ONG TO ONE SHRI AJAY BEEGOO, WHO IN TURN, HA D OWNED UP THE CORRESPONDENCE AND E - MAIL ENLISTED IN THE AFFIDAVIT FILED BY HIM. THE SAID AFFIDAVIT FILED BY SHRI AJAY BEEGOO WAS NOT ACCEPTED BY THE CIT(A) IN THE ABSENCE OF ANY EVIDENCE PRODUCED BY THE ASSESSE E WITH REFERENCE TO SHRI AJAY BEEGOO, WHO IN TURN, CLAIMED T HAT HE HAD GIVEN ESSENCE OF TRANSACTION. FURTHER, HIS AFFIDAVIT WAS NOT SUPPORTED BY PASSPORT DETAILS OF RELEVANT DATES. THOUGH THE ASSESSING OFFICER IN THE FIRST INSTANCE MADE AN ADDITION OF RS .47 LAKHS AS INCOME OF THE ASSESSEE, BUT THEN HE FURTHER CLARIFIE D THAT THE SAID ADDITION WOULD BE DELETED, IF THE NECESSARY EVIDENCE WAS PRODUCED BY THE ASSESSEE. BEFORE THE CIT(A), THE ASSESSEE NECESSARY EVIDENCE WAS PRODUCED BY THE ASSESSEE. BEFORE THE CIT(A), THE ASSESSEE FURNISHED INFORMATION AND IT WA S POINTED OUT THAT THOUGH TH E ACCOUNT TITLE AS KOHINOOR ACCOUNT WAS FOUND FROM HIS COMPUTER, BUT NO CONNECTION OF THE ASSESSEE WITH THE SAID KOHINOOR HAS BEEN FOUND. FURTHER, NO EVIDENCE WAS FOUND DURING THE COURSE OF SEARCH IN RESPECT OF THE SAID TRANSACTION, THOUGH VOLUMINOUS BOOK S AND DOCUMENTS WERE SEIZED. THE ASSESSEE FURTHER CLAIMED THAT SHRI AJAY BEEGOO HAD CATEGORICALLY CONFIRMED THAT THE FILE CONSISTED OF TRANSACTIONS UNDERTAKEN BY HIM AND WAS PREPARED WHILE HE WAS IN PUNE IN THE OFFICE OF THE ASSESSEE AND ALSO THE COPY OF PASSPORT OF SHRI AJAY BEEGOO WAS FILED IN ORDER TO ENABLE THE ASSESSING OFFICER TO CONFIRM THESE FACTS. FURTHER, SHRI AJAY BEEGOO DIRECTLY SENT AN E - MAIL TO E - MAIL ID OF ASSESSING OFFICER TO CONFIRM THE SAID FACTS AND WHERE SUFFICIENT EVIDENCE WAS PRODUCE D BEFORE THE ASSESSING OFFICER, THERE WAS NO JUSTIFICATION IN THE AFORESAID ADDITION, WHICH WAS WITHOUT ANY BASIS. ADMITTEDLY, IN CASE ANY DOCUMENT IS FOUND FROM THE POSSESSION AND ITA NO S. 91 TO 93 /PN/201 4 MR. AJAY A. BAFNA 23 CONTROL OF THE ASSESSEE WITHIN MEANING OF SECTION 132(4A) OF THE ACT, THE PRESUMPTION IS THAT THE DOCUMENT BELONGED TO ASSESSEE, BUT THE CONTENTS OF THE DOCUMENT HAVE TO BE SEEN WHETHER THE SAME HAS ANY CONNECTION WITH THE ASSESSEE. IN CASE THE CONTENTS OF THE DOCUMENT ARE NOT COMPLETE TO ESTABLISH THE LINK WITH THE ASSESSEE, M ERELY BECAUSE IT IS FOUND IN THE COMPUTER OF ASSESSEE, THE PRESUMPTION CANNOT BE DRAWN AGAINST THE ASSESSEE, ESPECIALLY IN THE CIRCUMSTANCES, WHERE THE ASSESSEE CLAIMS THAT THE SAME BELONGS TO THIRD PARTY. FURTHER, THE SAID THIRD PARTY CONFIRMED BY WAY OF AFFIDAVIT FILED BEFORE THE ASSESSING OFFICER THAT THE SAID EXCEL FILES RELATE D TO HIM AND HE ALSO CONFIRM ED ALL THESE FACTS BY WAY OF E - MAIL TO THE E - MAIL ID OF ASSESSING OFFICER AND ALSO FILED THE REQUISITE PASSPORT DETAILS IN THIS REGARD THAT HE WAS IN PUNE DURING THE PERIOD AND THOSE DOCUMENTS WERE PREPARED BY HIM AND THEY BELONG ED TO HIM . THE ONUS IN THIS REGARD WAS UPON THE ASSESSING OFFICER TO VERIFY THE CLAIM OF ASSESSEE AND NOT TO MERELY REJECT THE SAME. THE ASSESSEE WAS ENGAGED IN THE BUSINESS O F REAL ESTATE AND THE TRANSACTION HAD TO BE SEEN WITH AN ANGLE OF BUSINESS CARRIED ON BY THE ASSESSEE. WE FIND NO MERIT IN THE AFORESAID ADDITION MADE BY THE CARRIED ON BY THE ASSESSEE. WE FIND NO MERIT IN THE AFORESAID ADDITION MADE BY THE ASSESSING OFFICER IN THE HANDS OF ASSESSEE, WHICH IN TURN, HAS BEEN CLARIFIED BY HIM THAT IN CASE EVIDENCE IS FILED, THE SAME WOULD BE DELETED. FURTHER, THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE HAS FAIRLY POINTED OUT THAT IN ORDER TO COVER UP DISCREPANCY FROM YEAR TO YEAR, IT HAS OFFERED ADDITIONAL INCOME IN ITS HANDS OF RS.4 0 LAKHS UP TO 31.03.2007 AND RS.10 LAKHS IN THE CURRENT YEAR UNDER APPEAL. IN THE TOTALITY OF THE ABOVE SAID FACTS AND CIRCUMSTANCES, WE DELETE THE ADDITION OF RS.47 LAKHS. THE GROUND OF APPEAL NO.4 RAISED BY THE ASSESSEE IS THUS, ALLOWED. THE GROUNDS OF APPEAL RA ISED BY THE ASSESSEE ARE THUS, PARTLY ALLOWED. 3 3 . THE ASSESSEE IN ITA NO. 9 3 /PN/201 4 HAS RAISED THE FOLLOWING GROUNDS OF APPEAL: - ITA NO S. 91 TO 93 /PN/201 4 MR. AJAY A. BAFNA 24 1. THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED IN LOW AND: IN FACTS IN NOT APPRECIATING THAT THE ASSESSME NT ORDER PASSED BY THE ASSESSING OFFICER U/S 143( 3) R.W.S 153A OF THE ACT WAS BAD IN LOW AND INVALID. OFFICER U/S 143( 3) R.W.S 153A OF THE ACT WAS BAD IN LOW AND INVALID. 2. THE LEARNED COMMISSIONER OF INCOME - TAX (APPEALS) HAS ERRED IN LOW AND IN FACTS IN CONFIRMING THE ADDITION M A DE BY THE ASSESSING OFFICER ON ACCOUNT OF THE CASH SEIZED AT THE TIME OF THE SEARCH AMOUNTING TO RS . 3,78,500/ - . 3. THE LEARNED COMMISSIONER OF INCOME - TAX (APPEALS) HAS ERRED IN LOW AND IN FACTS IN NOT DELETING THE ADDITION OF RS . 13,62,000/ - AND DIRECTING THE ASSESSING OFFICER TO VERIFY WHETHER THE SAID ADDITION OF RS . 13,62,000/ - WAS PART AND PARCEL OF THE DISCLOSED OF RS . 70,07,190/ - 4. THE LEARNED COMMISSIONER OF INCOME - TAX (APPEALS) HAS ERRED IN LOW AND IN FACTS IN CONFIRMING THE ADDITIONS M A DE BY THE ASSESSING OFFICER ON ACCOUNT OF UNEXPLAIN ED C A SH IN THE CASH BOOK AMOUNTING TO RS . 1,18,97,000/ - . UNEXPLAIN ED C A SH IN THE CASH BOOK AMOUNTING TO RS . 1,18,97,000/ - . 5. THE LEARNED COMMISSIONER OF INCOME - TAX (APPEALS) HAS ERRED IN LOW AND IN FACTS IN NOT DELETING THE ADDITION OF RS . 13,62,000/ - , INCLUDED IN THE ADDITIONS OF RS . 1,18,97,000/ - AS THE SOME AMOUNTS TO THE DOUBLE ADDITION. 3 4 . THE GROUND OF APPEAL NO.1 RAISED BY THE ASSESSEE BEING GENERAL, IS NOT PRESSED AND THE SAME IS DISMISSED AS NOT PRESSED. 3 5 . THE ISSUE IN GROUND OF APPEAL NO.2 RAISED BY THE ASSESSEE IS AGAINST THE ADDITION MADE ON ACCOUNT OF C ASH SEIZED AT THE TIME OF SEARCH OF RS.3,78,500/ - . 3 6 . THE ASSESSING OFFICER MADE AN ADDITION ON ACCOUNT OF CASH SEIZED DURING THE COURSE OF SEARCH AS THE ASSESSEE WAS UNABLE TO EXPLAIN THE SOURCE OF CASH. BEFORE THE CIT(A), THE CLAIM OF THE ASSESSEE WAS THAT THE CASH AMOUNTING TO RS. 42,31,973/ - WAS THE CASH BALANCE AS PER BOOKS OF ACCOUNT AND AS SUCH, THE ASSESSEE HAD SUFFICIENT CASH BALANCE TO JUSTIFY THE CASH FOUND. THE EXPLANATION OF THE ASSESSEE WAS REJECTED BY THE CIT(A) SINCE THE RESIDENTIAL AND B USINESS PREMISES OF THE ASSESSEE WERE COVERED AND REMAINING AMOUNT OF CASH WAS NOT FOUND AT THE TIME OF SEARCH. FURTHER, THE CIT(A) NOTED THAT THE FACT OF NON - MAINTENANCE OF CASH BOOK IN REGULAR COURSE WAS SUFFICIENT TO REJECT THE EXPLANATION OF THE ASSES SEE. ITA NO S. 91 TO 93 /PN/201 4 MR. AJAY A. BAFNA 25 3 7 . THE ASSESSEE IS IN APPEAL AGAINST THE ORDER OF CIT(A) AND POINTED OUT THAT ALL DOCUMENTS WERE FOUND DURING THE COURSE OF SEARCH AND ON THE BASIS OF THE SAME, ENTRIES WERE MADE IN THE BOOKS OF ACCOUNT AND ON THE DATE OF SEARCH CASH IN HA N D WAS R S.42 LAKHS, WHICH WAS NOT ACCEPTED BY THE CIT(A) SINCE THE BALANCE CASH WAS NOT FOUND. 3 8 . THE LEARNED DEPARTMENTAL REPRESENTATIVE FOR THE REVENUE PLACED RELIANCE ON THE ORDERS OF AUTHORITIES BELOW. 3 9 . WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE RECORD. THE ADDITION IN THE HANDS OF ASSESSEE WAS MADE ON ACCOUNT OF CASH SEIZED FROM HIS PREMISES DURING THE COURSE OF SEARCH AMOUNTING TO RS. 3,78,500/ - . THE EXPLANATION OF THE ASSESSEE WAS THAT THE SAID CASH WAS OUT OF CASH BALANCE IN ITS BOOKS OF ACC OUNT AND WAS ACCOUNTED FOR IN THE BOOKS OF ACCOUNT. THE ASSESSEE HAD MADE ENTRIES IN THE CASH BOOK AND HAD WORKED OUT THE CASH BALANCE OF RS. 42,31,973/ - AS ON DATE OF SEARCH. THE SAID ENTRIES OF AVAILABILITY OF CASH WERE REJECTED BY THE ASSESSING OFFICER AND THE CIT(A) ON THE PREMISE THAT THE BOOKS OF ACCOUNT WERE NOT COMPLETE ON THE DATE OF SEARCH AND FURTHER, THE REMAINING CASH WAS NOT FOUND DURING THE COURSE OF SEARCH. WITH REGARD TO OBSERVATION OF CIT(A) VIS - - VIS REMAINING CASH IN HAND BEING AVAILAB LE ON THE DATE OF SEARCH, WE FIND NO MERIT IN THE SAID STAND OF THE AUTHORITIES BELOW . WITH REGARD TO ENTRIES IN THE BOOKS OF ACCOUNT, WHICH WERE MADE ON A LATER DATE , HOWEVER, LOOKING AT THE DIFFERENCE BETWEEN THE CASH FOUND OF RS.3,78,500/ - AND THE AVAI LABILITY OF CASH AS PER CASH BOOK OF RS. 42,31,973/ - , WE ARE OF THE VIEW THAT THE PRESUMPTION IS IN FAVOUR OF THE ASSESSEE THAT THE CASH FOUND DURING THE COURSE OF SEARCH IS DULY EXPLAINED. IN VIEW OF THE SMALLNESS OF CASH FOUND DURING THE COURSE OF SEARCH AS AGAINS T THE LARGE AMOUNT SHOWN IN THE BOOKS OF ACCOUNT, WE ACCEPT THE PLEA OF THE ASSESSEE. HOWEVER, THIS DECISION OF OUR , SHALL NOT BE USED AS PRECEDENT IN ANY OTHER CASE. THE GROUND OF APPEAL NO.2 RAISED BY THE ASSESSEE IS THUS, ALLOWED. ITA NO S. 91 TO 93 /PN/201 4 MR. AJAY A. BAFNA 26 40 . NOW, C OMING TO THE GROUNDS OF APPEAL NO.3 TO 5 RAISED BY THE ASSESSEE. 4 1 . THE FIRST OBJECTION OF THE ASSESSEE IS AGAINST THE ADDITION OF RS.13,62,000/ - AND DIRECTIONS OF CIT(A) TO THE ASSESSING OFFICER TO VERIFY WHETHER THE SAID ADDITION WAS PART AND PARCEL OF DISCLOSURE OF RS.70,07,190/ - . BY WAY OF GROUNDS OF APPEAL NO.4 AND 5, THE ASSESSEE IS AGGRIEVED BY THE ADDITION MADE BY AUTHORITIES BELOW ON ACCOUNT OF UNEXPLAINED CASH IN THE CASH BOOK AMOUNTING TO RS.1,18,97,000/ - . 4 2 . BRIEFLY, IN T HE FACTS RELATI NG TO THE ISSUE ALSO, CERTAIN INFORMATION WAS COLLECTED FROM THE COMPUTER EXCEL SHEET UNDER KRANTI GROUP AND C ERTAIN ENTRIES WERE FOUND . HOWEVER, NO PERIOD / DATE WAS MENTIONED AND AT THE END, THERE WAS CREDIT OF RS. 13,62,000/ - AND THE ASSESSEE WAS ASKED AS TO WHY THE SAID CREDIT SHOULD NOT BE CONSIDERED AS HIS INCOME. THE ASSESSEE IN REPLY STATED THAT THIS IS FOUND FROM COMPUTER AND IN THE BOOKS OF SOMEBODY. IT DID NOT RELATE TO HIM AND HE DID NOT CARRY ASSESSEES NAME AND DID NOT CARRY ANY DATE ON IT A ND HENCE, NO ADDITION WAS CALLED FOR ON THIS COUNT. THE ASSESSING OFFICER REJECTING THE EXPLANATION OF THE ASSESSEE, ADDED THE SAME AS INCOME OF THE ASSESSEE. FURTHER, DURING THE COURSE OF SEARCH, BUNDLE NO.1 CONTAINING PAGES 1 TO 10 WERE ALSO FOUND. TH E PAGES 2 TO 10 OF SAID BUNDLE CONTAINED DATEWISE PAYMENT ACCOUNT FOR THE PERIOD FROM 27.11.2009 TO 13.02.2010 AND THE ASSESSEE WAS ASKED TO EXPL AIN ENTRIES THEREIN. THE ASSESSEE SUBMITTED THAT IT HAD MADE DECLARATION OF RS.70 LAKHS AND RS.60 LAKHS WAS DI SCLOSED AS ADDITIONAL INCOM E FOR ASSESSMENT YEAR 2010 - 11 IN ORDER TO BUY PEACE OF MIND AND TO COVER UP ANY TRANSACTIONS ARISING OUT OF SEIZED DOCUMENTS REPRESENTING UNDISCLOSED ACTIVIT Y. HE ASKED FOR THE SAME. THE ASSESSEE ALSO PRO DUCED THE CASH BOOK. H OWEVER, CERTAIN INFORMATION WAS ASKED FOR BY THE ASSESSING OFFICER AND THE ASSESSEE EXPRESSED HIS INABILITY TO PRODUCE THE SAME. THE ASSESSING OFFICER THUS, HELD THAT THE EVIDENCE BROUGHT ON RECORD WAS NOT VERIFIABLE, WHEREIN THE ASSESSEE WAS ASKING FOR S ET OFF OF DEBIT AND CREDIT ENTRIES APPEARING IN THE SAME NAME. THE ASSESSING OFFICER HELD THAT ITA NO S. 91 TO 93 /PN/201 4 MR. AJAY A. BAFNA 27 THE CONTENTION OF THE ASSESSEE COULD ONLY BE ACCEPTED IF H E COULD PRODUCE THE SAID PERSONS AND IN THE ABSENCE OF THE SAME, THE CREDIT ENTRY OF RS.1.18 CRORES WA S CONSIDERED AS UNEXPLAINED CASH OF THE ASSESSEE. THE ASSESSING OFFICER FURTHER NOTES THAT AS REGARD THE DECLARATION OF RS.70 LAKHS OF PRESENT YEAR, THE SAME HAS BEEN ALLOWED TO BE SET OFF AGAINST THE ADDITION OF RS. 1,18,97,000/ - . HOWEVER, FROM THE COMPU TATION OF INCOME, WE DO NOT FIND THE SAID SET OFF OF THE INCOME . A S PER RETURN OF INCOME , DECLARED INCOME HAS BEEN TAKEN A T RS.70 ,07,190/ - , TO WHICH UNEXPLAINED CASH OF RS.1.18 CRORES AND OTHER ADDITIONS TOTALING RS. 1.40 CRORES ARE ADDED AND THE TOTAL INC OME ASSESSED AS RS.2.10 CRORES. 4 3 . THE CIT(A) UPHELD THE ADDITION OF RS.13,62,000/ - IN THE HANDS OF ASSESSEE REJECTING THE CONTENTION OF THE ASSESSEE IN THIS REGARD. THE CIT(A) NOTED THAT THE ASSESSEE HAD ADMITTEDLY , MADE ENTRIES UNDER THE HEAD SAI A CCOUNT IN ITS BOOKS OF ACCOUNT AND HENCE, THE SAME BELONGED TO THE ASSESSEE . V IS - - VIS SECOND CONTENTION OF THE ASSESSEE THAT THE CASH ARISING OUT OF TRANSACTIONS HAVE ALREADY BEEN OFFERED TO OF THE ASSESSEE THAT THE CASH ARISING OUT OF TRANSACTIONS HAVE ALREADY BEEN OFFERED TO TAX UNDER THE DECLARATION OF RS.70 LAKHS ON ACCOUNT OF UNDISCL OSED INCOME EARNED DURING THE YEAR. THE CIT(A) DIRECTED THE ASSESSING OFFICER TO VERIFY THE CLAIM OF THE ASSESSEE AND IN CASE IT IS BEING SO INCLUDED, THEN NO FURTHER ADDITION IS TO BE MADE IN THE HANDS OF ASSESSEE, THE SECOND ASPECT IS THE ADDITION OF R S.1.18 CRORES. THE CONTENTION OF THE ASSESSEE BEFORE THE CIT(A) WAS THAT THE ASSESSING OFFICER HAS ONLY CONSIDERED THE CREDIT ENTRIES IN THE DOCUMENT AND NOT CONSIDERED THE DEBIT ENTRIES. HOWEVER, THIS CONTENTION OF THE ASSESSEE WAS REJECTED OBSERVING TH AT THE ASSESSEE HAS FAILED TO RAISE ANY SERIOUS ARGUMENTS CHALLENGING THE MERITS OF ADDITIONS OF INCOME. FURTHER, THE CIT(A) NOTED THAT THE CONTENTION OF ASSESSEE THAT ADDITION OF RS.1.18 CRORES ALSO INCLUDE SUM OF RS.13,62,000/ - , WHICH HAS BEEN SEPARATEL Y ADDED BY THE ASSESSING OFFICER. THE ASSESSING OFFICER WAS DIRECTED TO CHECK THE VERACITY OF THE SAID TRANSACTION AND DECIDE THE ISSUE ACCORDINGLY. FURTHER, THE CONTENTION OF THE ASSESSEE WAS THAT THE ASSESSING OFFICER HAD NOT ALLOWED THE BENEFIT OF RS. 70 LAKHS, WHICH WAS ITA NO S. 91 TO 93 /PN/201 4 MR. AJAY A. BAFNA 28 OFFERED BY HIM AGAINST THE ASSESSED INCOME. THE ASSESSING OFFICER IN THE REMAND REPORT DATED 16.09.2013 HAD REITERATED THAT THERE WAS NO OBJECTION FOR RELIEF OF RS.70 LAKHS AS ADMITTED BY THE ASSESSING OFFICER IN THE ASSESSMENT ORDER. HENCE, THE GROUND OF APPEAL RAISED BY THE ASSESSEE IN THIS REGARD , WAS DISMISSED. 4 4 . THE ASSESSEE IS IN APPEAL AGAINST THE OBSERVATIONS OF CIT(A) AND HAS STRESSED THAT WHILE COMPUTING ADDITION IN THE HANDS OF ASSESSEE TO THE EXTENT OF RS.1.18 CRORES, THE ASSESSING OFFICER HAS ONLY CONSIDERED CREDIT SIDE OF THE ENTRIES, BUT NO T DEBIT SIDE ENTRIE S. THE ASSESSEE FAIRLY ADMITTED THAT THE ASSESSING OFFICER MAY VERIFY THE CLAIM OF THE ASSESSEE AND ALLOW THE BENEFIT OF DEBIT SIDE ENTRIES. WITH REGARD TO THE ADDITION OF RS.13,62,000/ - , THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE ADMITTED THAT THE SAME WAS CONSIDERED IN ITS ACCOUNTS , HOWEVER, NO SEPARATE ADDITION SHOULD BE MADE IN THIS REGARD. 4 5 . THE LEARNED DEPARTMENTAL REPRESENTATIVE FOR THE R EVENUE PLACED RELIANCE ON THE ORDERS OF AUTHORITIES BELOW. 4 6 . WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE RECORD. THE FIRST ADDITION IN THE HANDS OF ASSESSEE IS ON ACCOUNT OF ENTRIES UNDER THE HEAD SAI ACCOUNT TOTALING RS.13,62,000/ - . THE AS SESSEE ADMITS TO HAVE INCLUDED THE SAID SUM OF RS. 13,62,000/ - IN THE DECLARED INCOME OF RS.70 LAKHS FOR THE YEAR UNDER CONSIDERATION AND SINCE THE AMOUNT WAS ADDITIONAL INCOME, THERE WAS NO MERIT IN ANY FURTHER ADDITION . WE FIND THAT THE CIT(A) VIDE PARA 58.7 AT PAGE 68 HAS DIRECTED THE ASSESSING OFFICER TO VERIFY THE CLAIM OF THE ASSESSEE IN THIS REGARD AND WE FIND NO MERIT IN THE GROUND OF APPEAL NO.3 RAISED BY THE ASSESSEE AND HENCE, THE SAME IS DISMISSED. 4 7 . NOW, COMING TO THE NEXT ADDITION OF RS. 1.1 8 CRORES. THE CLAIM OF THE ASSESSEE BEFORE US IS THAT THE ADDITION HAS BEEN COMPUTED ON THE BASIS OF CUMULATIVE TOTAL OF ITA NO S. 91 TO 93 /PN/201 4 MR. AJAY A. BAFNA 29 CREDIT ENTRIES ON THE SEIZED DOCUMENT . HOWEVER, ON THE SAID DOCUMENT ITSELF, THERE WERE DEBIT ENTRIES, WHICH HAVE NOT BEEN CONSIDERED EITHER BY ASSESSING OFFICER OR CIT(A). THE ASSESSING OFFICER HAD MADE THE AFORESAID ADDITION ON THE BASIS OF PAGES 2 TO 10 OF THE BUNDLE NO.1 SEIZED DURI NG THE COURSE OF SEARCH, WHICH CONTAINED DATEWISE RECEIPTS AND PAYMENTS ACCOUNT FOR THE PERIOD FROM 2 7.11.2009 TO 13.02.2010 . IT IS A TRITE LAW AND HELD BY VARIOUS JUDICIAL AUTHORITIES THAT IN CASE RELIANCE IS PLACED ON SEIZED DOCUMENTS, THEN THE COMPLETE ENTRIES ON THE SAID DOCUMENTS ARE TO BE CONSIDERED FOR WORKING OUT THE ADDITION, IF ANY, IN THE HAND S OF ASSESSEE. THE ASSESSING OFFICER HIMSELF HAS ADMITTED THAT THERE WERE DATEWISE RECEIPTS AND PAYMENTS ACCOUNT FOR THE SPECIFIED PERIOD AT PAGES 2 TO 10 OF THE BUNDLE NO.1, WHICH WE RE BASIS FOR MAKING THE AFORESAID ENTRIES. THE CASE OF THE ASSESSEE ON THE OTHER HAND, WAS THAT IT HAD ALREADY OFFERED ADDITIONAL INCOME OF RS.70 LAKHS IN ORDER TO BUY PEACE OF MIND AND TO COVER ANY TRANSACTIONS ARISING OUT OF SEIZED DOCUMENTS. THE SAID ADDITIONAL INCOME OF RS.70 LAKHS HAS BEEN DECLARED BY THE ASSESSEE IN TH E RETURN OF INCOME FILED. IN THE ENTIRETY OF THE ABOVE SAID FACTS AND CIRCUMSTANCES, WE FIND MERIT OF INCOME FILED. IN THE ENTIRETY OF THE ABOVE SAID FACTS AND CIRCUMSTANCES, WE FIND MERIT IN THE CLAIM OF THE ASSESSEE THAT THE ADDITION CANNOT BE MADE IN THE HANDS OF ASSESSEE BY ONLY TOTALING OF CREDIT SIDE OF THE ENTRIES. THE DEBIT SIDE ENTRI ES, IF ANY, ON THE SAID SEIZED DOCUMENT, NEEDS TO BE CONSIDERED AND ONLY DIFFERENCE OF THE ENTRIES IS TO BE ADDED IN THE HANDS OF ASSESSEE. FURTHER, THE ASSESSEE CLAIMS THAT IT HAD ALREADY OFFERED RS.70 LAKHS AS ADDITIONAL INCOME AGAINST THE DISCREPANCY, IF ANY, FOUND IN THE SEIZED DOCUMENTS. THE CIT(A) HAD TAKEN NOTE OF THE FACT THAT THE ASSESSING OFFICER HAD NOT ALLOWED THE BENEFIT OF RS.70 LAKHS WHILE COMPUTING ADDITION IN THE HANDS OF ASSESSEE. THE ASSESSING OFFICER IN THE REMAND REPORT HAS ADMITTED THAT THE SAME IS ALLOWABLE TO THE ASSESSEE. ACCORDINGLY, WE DIRECT THE ASSESSING OFFICER TO RE - COMPUTE THE INCOME ON THE BASIS OF ENTRIES IN THE SAID DOCUMENT, BOTH CREDIT AND DEBIT AND TO GIVE BENEFIT OF ADDITIONAL INCOME OF RS.70 LAKHS BEFORE MAKING ANY ADDITION IN THE HANDS OF ASSESSEE. IT MAY ALSO BE CLARIFIED HERE THAT THE ADDITIONAL INCOME OF RS.70 ITA NO S. 91 TO 93 /PN/201 4 MR. AJAY A. BAFNA 30 LAKHS ALSO COVERS THE ADDITION OF RS. 13,62,000/ - , WHICH HAS BEEN CONFIRMED BY US IN RESPECT OF GROUND OF APPEAL NO.3. THE ASSESSING OFFICER SHALL GIVE R EASONABLE OPPORTUNITY OF HEARING TO THE ASSESSEE WHILE RE - COMPUTING THE INCOME OF THE ASSESSEE. THE GROUNDS OF APPEAL NO.4 AND 5 RAISED BY THE ASSESSEE ARE THUS, ALLOWED . THE GROUNDS OF APPEAL RAISED BY THE ASSESSEE ARE THUS, PARTLY ALLOWED. 4 8 . IN THE RESULT, ALL THE APPEALS OF THE ASSESSEE ARE PARTLY ALLOWED. ORDER PRONOUNCED ON THIS 10 TH DAY MARCH , 201 6 . SD/ - SD/ - (PRADIP KUMAR KEDIA ) (SUSHMA CHOWLA) / ACCOUNTANT MEMBER / JUDICIAL MEMBER / PUNE ; D ATED : 10 TH MARCH , 201 6 . GCVSR GCVSR / COPY OF THE ORDER IS FORWARDED TO : 1. / T HE APPELLANT ; 2. / THE RESPONDENT; 3. ( ) / THE CIT (A) - CENTRAL , PUNE ; 4. / THE CIT , CENTRAL, PUNE ; 5. , , / DR B , ITAT, PUNE; 6. / GUARD FILE . / BY ORDER , // TRUE COPY // / SR. PRIVATE SECRETARY , / ITAT, PUNE