M/s Om Commodity Brokers, Sirsa V. ACIT, Chandigarh

ITA 956/CHANDI/2014

• Counselvise Citation: [2015] 120 COUNSELVISE.COM (IT) 8700 (ITAT-CHANDIGARH)
• Duration Of Justice: 2 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-01-2015
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 22-01-2015
• Assessment Year: 2008-2009
• Appeal Filed On: 03-11-2014
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: S K MITTAL
• Keywords: Search and seizure
• Section: 143(3); 153A

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL CHANDIGARH BENCH A, CHANDIGARH BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER AND SHRI T.R.SOOD, ACCOUNTANT MEMBER ITA NO. 956/CHD/2014 ASSESSMENT YEAR : 2008-09 M/S OM COMMODITY BROKERS, VS. THE A.C.I.T., FLAT NO.8, FIRST FLOOR, CENTRAL CIRCLE I, SIRSA CLUB COMPLEX, CHANDIGARH. JANTA BHAWAN ROAD, SIRSA. PAN: AABFO2586J (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI M.R.SHARMA RESPONDENT BY : SHRI S.K.MITTAL, DR DATE OF HEARING : 22.01.2015 DATE OF PRONOUNCEMENT : 28.01.2015 O R D E R PER BHAVNESH SAINI, J.M. : THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAI NST THE ORDER OF LEARNED COMMISSIONER OF INCOME TAX (APPEALS)(CENTRAL), GURGAON DATED 11.9.2014 FOR ASSESSMENT YEAR 2008-09, CHALLENGING THE ADDITION O F RS.3,79,070/-. 2. THE ASSESSING OFFICER MADE DISALLOWANCE OF RS.3,79,070/- AS PER PARA 8 OF THE ASSESSMENT ORDER ON ACCOUNT OF CASH FOUND IN THE RESIDENCE OF SHRI RAJ KUMAR JALAN, PROPRIETOR OF D.P. STOCK BROKERS, SIRSA SURR ENDERED UNDER SECTION 132(4) OF THE ACT AND ASSESSED IN HIS HANDS. 2 IN THIS CONNECTION THE ASSESSEE CONTENDED BEFORE TH E LEARNED CIT (APPEALS) AS UNDER : THE ASSESSEE DURING ASSESSMENT PROCEEDINGS EXPLAIN ED THAT THE CASH FOUND AT THE RESIDENCE WAS OUT OF HIS EARLIER WITHDRA WALS & CASH AVAILABLE WITH HIS PROPRIETORSHIP CONCERN M/S D.P. ST OCK BROKERS & OM COMMODITY BROKERS SIRSA WHEREIN HE WAS PARTNER. THE OPENING BALANCE AS ON 25-3-08 (DATE OF SEARCH) WITH D.P. STOCK BROKERS STOOD AT RS.34413-48 & CASH AVAILABLE WITH OM COMMODITY BROKERS AS OPENING BALANCE ON 25-3-08 STOOD AT RS.317808-00. THE ASSESSEE SH. RAJ KUMAR J ALLAN, HOWEVER, SURRENDERED THE WHOLE OF THE CASH FOUND AT THE RESI DENCE AMOUNTING TO RS.379070-00 AS HIS INCOME FOR BUYING PEACE & AVOID ING DISPUTE WITH THE DEPARTMENT OUT OF WHICH RS.350000/- WAS SEIZED. THE ASSE SSEE ON SECOND DAY ON 26-3-2008 DEBITED RS.315000-00 IN HIS NAME T OWARDS PAYMENT OF INCOME TAX IN OM COMMODITY BROKERS & RS.35000-00 IN THE BOOKS OF M/S D.P. STOCK BROKERS, SIRSA FOR THE AMOUNT SEIZED FOLLO WING HIS STATEMENT THAT THE SEIZED SUM OF RS.350000/- MAY BE SET OF AGAIN ST INCOME TAX IN HIS NAME. THE REMAINING SHORTAGE IN M/S OM COMMODITY BR OKERS WAS ALSO MADE BY SH. RAJ KUMAR JALLAN OUT OF CASH FOUND AT HOM E. THE LD. ASSESSING OFFICER DURING ASSESSMENT PROCEED INGS WAS FULLY AWARE OF THE ADDITION OF RS.379070-00 MADE IN THE HANDS O F RAJ KUMAR JALLAN SURRENDERED BY HIM U/S 132(4) & INCLUDED IN THE DISCLOS ED FIGURE. THEREFORE, NO QUERY ON THE ORDER SHEET ENTRIES WAS MA DE ON THIS ACCOUNT AS & WHEN THE ASSESSEE & HIS COUNSEL APPEARED DURING A SSESSMENT PROCEEDINGS OF THIS FIRM. HOWEVER, THIS ADDITION WA S MADE IN THE HANDS OF OM COMMODITY BROKERS, SIRSA LATER ON THE BASIS OF ME RE ASSUMPTIONS FOR SETTING OF THE REFUND DUE TO THE ASSESSEE. 3. THE LEARNED CIT (APPEALS), HOWEVER, CONSIDERING THE EXPLANATION OF THE ASSESSEE CONFIRMED THE ADDITION AND DISMISSED THIS GROUND OF APPEAL OF THE ASSESSEE. HIS FINDINGS IN PARA 7.1 OF THE APPELLATE ORDER ARE REPRODUCED A S UNDER : 7.1 1 HAVE CONSIDERED THE ASSESSEE'S SUBMISSION A ND THE IMPUGNED ORDER. THE FACTS OF THE CASE ARE NOT IN DISPUTE. A CO PY OF THE ASSESSMENT ORDER U/S 153A R.W.S 143(3) DATED 29.12.2009 OF SHRI R K JALLAN FOR AY 2008-09 WAS FURNISHED BY THE ASSESSEE TO SHOW THAT T HE CASH FOUND OF RS. 3,79,070/- AT THE RESIDENCE OF THE PARTNER OF T HE FIRM SHRI RAJ KUMAR JALLAN WAS PART OF THE SURRENDER OF RS.60 LAKHS. HOWEVER, THE CONTENTION OF THE ASSESSEE IS NOT TRUE O N A READING OF PARA 6 OF THE ASSESSMENT ORDER OF SHRI RK JALLAN FOR AY 2008-09. IT EMERGES THAT IN THE BOOKS OF ACCOUNTS OF M/S DP STO CK BROKERS WHICH IS 3 THE PROPRIETARY CONCERN OF SHRI RK JALLAN, THERE WAS A DIFFERENCE OF RS.3,60,357/- AS ON 25.3.2008 WHICH IN THE FINAL ANALYSIS WAS TREATED AS PART OF THE SURRENDER OF RS.60 LAKHS. AS FOR THE C ASH FOUND IN THE RESIDENCE, THE EXPLANATION OFFERED U/S 132(4) WAS THA T THE SAME BELONGED TO M/S OM COMMODITY BROKERS. IN OTHER WORDS, THE DIFFERENCE FOUND IN THE BOOKS OF D.P. STOCK BROKERS WAS ADDED BACK IN THE HANDS OF SHRI RAJ KUM AR JALLAN AND CONSEQUENTIALLY, THE CASH FOUND OF RS. 3,79,070/- AT TH E RESIDENCE OF THE PARTNER OF THE FIRM SHRI RAJ KUMAR JALLAN WAS ASSESSED IN THE CASE OF THE ASSESSEE FIRM. THE ACTION OF THE AO IS CONFIRMED. AS SESSEE FAILS ON THIS GROUND OF APPEAL. 4. THE LEARNED COUNSEL FOR ASSESSEE SUBMITTED THAT THE ADDITION IS WHOLLY UNJUSTIFIED AGAINST THE ASSESSEE IN THIS CASE. THE AMOUNT IN QUESTION IS INCLUDED IN THE D ISCLOSURE OF SHRI RAJ KUMAR JALAN OF RS.60 LACS UNDER SECTION 13 2(4) OF THE ACT. THEREFORE, THE ADDITION IN THE CASE THE ASSESSEE FIRM SHOULD NOT HAVE BEEN MADE. 5. ON THE OTHER HAND, THE LEARNED D.R FOR THE REVEN UE RELIED UPON THE ORDERS OF THE AUTHORITIES BELOW. 6. WE HAVE HEARD THE RIVAL SUBMISSIONS. THE ASSES SING OFFICER NOTED THAT DURING THE SEARCH AND SEIZURE OP ERATION CONDUCTED AT THE RESIDENTIAL PREMISES OF SHRI RAJ K UMAR JALAN PROPRIETOR OF D.P. STOCK BROKERS, SIRSA, CASH AMOUN TING TO RS.3,79,070/- WAS FOUND. OUT OF THIS AMOUNT, CASH OF RS.3,50,000/- WAS SEIZED. THE ASSESSEE WAS CONFRO NTED TO PRODUCE DOCUMENTARY EVIDENCE IN THIS REGARD. THE ASSESSEE IN HIS STATEMENT EXPLAINED THAT THE CASH FOUND PERT AINS TO HIS SHARE BUSINESS AND WITHDRAWAL MADE BY HIM. HOWEVE R, NO DOCUMENTARY EVIDENCE WAS PRODUCED DURING THE COURSE OF SEARCH OPERATION. FURTHER DURING THE COURSE OF AS SESSMENT 4 PROCEEDINGS IN THE CASE OF SHRI RAJ KUMAR JALAN DIF FERENCE WAS FOUND IN THE BOOKS OF M/S D.P. STOCK BROKER FOR WHICH SHRI RAJ KUMAR JALAN HAS ADMITTED THAT THERE WAS A DIFFERENCE IN THE BOOKS OF M/S D.P. STOCK BROKER. REGARDING THE CASH FOUND AT HIS RESIDENCE DURING THE SEARCH, HE EXPLAI NED THAT THIS AMOUNT OF CASH OF RS.3,79,070/- FOUND AT HIS R ESIDENCE BELONGS TO ASSESSEE FIRM M/S OM COMMODITY BROKERS. THE ASSESSING OFFICER, THEREFORE, NOTED THAT SINCE THE PARTNER OF THE ASSESSEE FIRM HAD ADMITTED BOTH THE THINGS I.E. DIFFERENCE IN THE BOOKS OF M/S D.P. STOCK BROKER AND CASH BELO NGS TO M/S OM COMMODITY BROKERS, THE ASSESSEE FIRM, THEREF ORE, THE DIFFERENCE FOUND IN THE BOOKS OF M/S D.P. STOCK BRO KER HAS BEEN ADDED IN THE HANDS OF SHRI RAJ KUMAR JALAN. THEREFORE, THE CASH FOUND OF RS.3,79,070/- AT THE RESIDENCE OF THE PARTNER OF THE FIRM SHRI RAJ KUMAR JALAN WAS ASSESS ED IN THE HANDS OF THE ASSESSEE FIRM. IT IS, THEREFORE, NOT IN DISPUTE THAT THE PARTNER OF THE ASSESSEE FIRM ADMITTED THAT THE AMOUNT IN QUESTION BELONGS TO ASSESSEE FIRM. HOWE VER, NO EXPLANATION IN THIS REGARD HAS BEEN GIVEN AT ANY ST AGE TO EXPLAIN THE UNACCOUNTED CASH. THE LEARNED CIT (AP PEALS) ALSO CORRECTLY REFERRED TO THE ASSESSMENT ORDER DAT ED 29.12.2009 IN THE CASE SHRI RAJ KUMAR JALAN, IN WHI CH THE ASSESSEE ADMITTED THAT THE CASH IN QUESTION SURREND ERED BY HIM BELONGED TO M/S OM COMMODITY BROKERS I.E. THE A SSESSEE FIRM. THEREFORE, THERE IS NO QUESTION OF IT BEIN G PART OF THE SURRENDER OF RS.60 LACS MADE IN THE CASE OF SHRI RA J KUMAR JALAN. SINCE THE CASH FOUND AT THE RESIDENCE OF THE PARTNER OF THE ASSESSEE FIRM IS NOT EXPLAINED, THEREFORE, T HE ADDITION 5 WAS CORRECTLY MADE. THE APPEAL OF THE ASSESSEE HA S NO MERIT AND IS ACCORDINGLY, DISMISSED. 7. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 28 TH DAY OF JANUARY, 2015. SD/- SD/- (T.R.SOOD) (BHAVNESH SAINI) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 28 TH JANUARY, 2015 *RATI* COPY TO: THE APPELLANT/THE RESPONDENT/THE CIT(A)/TH E CIT/THE DR. ASSISTANT REGISTRAR, ITAT, CHANDIGARH