ACIT, V. Shri Jitendra M. Thakkar,

ITA 962/PUN/2008

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 7551 (ITAT-PUNE)
• Duration Of Justice: 5 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-02-2011
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: Not Allotted
• Assessment Year: misc
• Appeal Filed On: 08-09-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ABHAY DAMLE
• Keywords: Search and seizure; Document seized; Block assessment; Documents seized
• Section: 10

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH A , PUNE BEFORE SHRI I.C. SUDHIR (JM) AND SHRI D. KARUNAKARA RAO (AM) ITA NO. 962 /PN/200 8 ( BLOCK PERIOD 01.04.1996 TO 25.03.2003 ) ASSTT. COMMISSIONER OF INCOME TAX , CIRCLE - 2, WANI HOUSE, NEW MUMBAI AGR A ROAD, NASHIK .. APPELLANT V. SHRI. JITENDRA M. THAKKAR, 7, THAKKARS, NEAR NEHRU GARDEN, NASHIK PAN : ABSPT 3969L . RESPONDENT APPELLANT BY : SHRI ABHAY DAMLE RESPONDENT BY : SHRI NIKHIL PATHAK ORDER PER I.C. SUDHIR J M THE REVENUE HAS QUESTIONED FIRST APPELLATE ORDER WHEREBY LD CIT(A) HAS HELD THAT THE NOTICE ISSUED U/S. 158BD TO THE ASSESSEE WAS UNJUSTIFIED. THIS ACTION OF THE FIRST APPELLATE AUTHORITY HAS BEEN QUESTIONED BY THE REVENUE ON SEVERAL GROUNDS. IN C ONSEQUENCE, THE FIRST APPELLATE ORDER LD CIT(A) HAD D ELETED THE ADDITION OF RS. 29,04,350/ - HAS ALSO BEEN QUESTIONED. 2. WE HAVE HEARD AND CONSIDERED THE ARGUMENTS ADVANCED BY THE PARTIES IN VIEW OF THE ORDERS OF THE AUTHORITIES BELOW, MATERIAL AVAILABLE ON RECORD AND THE DECISIONS RELIED UPON. 3. THE RELEVANT FACTS ARE THAT THE A.O DURING THE COURSE OF THE BLOCK ASSESSMENT PROCEEDINGS IN THE CASE OF M/S. RISHIRAJ BUILDERS & DEVELOPERS FOUND SOME ENTRIES REGARDING CASH PAYMENTS MADE ON VARIOUS DATES AGAI NST THE DEVELOPMENT AGREEMENT ON PLOT NOS. 42 AND ITA NO 962 /PN/200 8 SHRI JITENDRA M. THAKKAR BLOCK PERIOD 01.04.1996 TO 25.03.2003 PA GE OF 11 2 33 MADE TO SHRI NARENDRA M. THAKKER, BROTHER OF THE ASSESSEE. THE ASSESSEE WAS GENERAL POWER OF ATTORNEY HOLDER IN RESPECT OF THE SAME PROPERTY. NOTICE U/S. 158 BD WAS ISSUED TO THE ASSESSEE WHILE GIVING INTIMATION OF THE SAME TO THE A.O HAVING JURISDICTION OVER THE ASSESSEE. DURING THE ASSESSMENT PROCEEDINGS, IN THE CASE OF THE ASSESSEE, THE A.O PROVIDED MATERIAL FOUND DURING THE PROCEEDINGS U/S. 132(4) IN THE PREMISES OF MR. Y.P. TRIVEDI, PARTNER OF M/ S. RISHIRAJ BUILDERS & DEVELOPERS. THE ASSESSEE WAS ASKED AS TO WHY THE CASH OF RS. 9,45,000/ - AND RS. 26,09,3509/ - AGAINST THE SALE OF PLOT NO. 42 AND 33 SHOULD NOT BE TAXED IN HIS HANDS. BEING NOT SATISFIED WITH THE EXPLANATION OF THE ASSESSEE, THE A. O FRAMED THE ASSESSMENT MAKING ADDITION OF RS. 29,04,350/ - AGAINST THE ASSESSEE. ASSESSEE WENT IN FIRST APPEAL QUESTIONING THE SAID ACTION OF THE A.O. THE FIRST OBJECTION OF THE ASSESSEE WAS REGARDING THE VALIDITY OF ACTION INITIATED U/S. 158BD OF THE A CT. THE LD CIT(A) HELD THAT THE NOTICE ISSUED U/S. 158BD AGAINST THE ASSESSEE IS UNJUSTIFIED ON THE BASIS THAT THE DEVELOPMENT AGREEMENT OF PLOT NO. 42 AND 33 WAS BETWEEN M/S. RISHIRAJ BUILDERS & DEVELOPERS AND SHRI PARAJI ABAJI KARANJKAR, THUS THE ASSES SEE DOES NOT COME UNDER THE PURVIEW OF THE WORD OTHER. IN CONSEQUENCE, THE ADDITION OF RS.29,04,350/ - AS UNDISCLOSED INCOME IN THE HANDS OF THE ASSESSEE HAS ALSO BEEN DELETED. THIS ACTION OF THE LD CIT(A) HAS BEEN QUESTIONED BEFORE US. 4. THE LD. D.R . HAS BASICALLY PLACED RELIANCE ON THE ASSESSMENT ORDER ON THE ISSUE. HE SUBMITTED THAT THE LD CIT(A) HAS FAILED TO APPRECIATE THAT ENTRIES MADE IN SEIZED MATERIAL IN THE NAME OF SHRI NARENDRA THAKKER PERTAINED TO THE TRANSACTION OF DEVELOPMENT OF PLOT NO S. 42 AND 33 IS SUFFICIENT PROOF FOR MAKING ADDITION IN THE HANDS OF THE ASSESSEE. SHRI NARENDRA THAKKER IS BROTHER OF THE ASSESSEE. ITA NO 962 /PN/200 8 SHRI JITENDRA M. THAKKAR BLOCK PERIOD 01.04.1996 TO 25.03.2003 PA GE OF 11 3 ENTRIES IN THE SEIZED DOCUMENT WERE MADE DURING THE ORDINARY COURSE OF BUSINESS, HENCE IT IS AN ADMISSIBLE EVIDENCE. TH E LD CIT(A) HAS ALSO FAILED TO APPRECIATE THAT INCOME - TAX PROCEEDINGS ARE GOVERED BY PREPONDERENCE OF PROBABILITIES AND NOT BY STRICT EVIDENCE OF LAW. LD CIT(A) HAS ALSO ERRED IN RELYING UPON THE SUBMISSIONS OF SHRI Y.P.TRIVEDI RECORDED ON 3.3.2008 DURIN G CROSS - EXAMINATION WHICH IS CONTRADICTORY TO HIS OWN STATEMENTS DATED 21.3.2005 DEPOSED CONSEQUENTIAL TO SEARCH ACTION U/S. 132 OF THE ACT ON 25.3.2003. LD CIT(A) HAS ALSO IGNORED THIS MATERIAL FACT THAT SHRI S H ASTRI WAS TRUSTED MAN OF SHRI Y.P. TRIVEDI AND ENTRIES IN HIS DIARY WERE MADE ON THE BASIS OF INFORMATION PROVIDED BY SHRI S H ASTRI AND BOTH THE PERSONS I.E. SHRI TRIVEDI AND SHRI S H ASTRI WERE FULLY AWARE OF THE ACTUAL FACTS IN RESPECT OF THE RELEVANT PROPERTY TRANSACTIONS WITH SHRI NARENDRA THAKKE R , THE BROTHER OF THE ASSESSEE. THE LD. D.R. ALSO FURNISHED THE ORDER DATED 23 RD JULY 2009 OF THE TRIBUNAL IN THE CASE OF LATE SHRI PARAJI ABAJI KARANJKAR V/S DCIT, ITA NO. 377/PN/2008 WHEREBY THE FIRST APPELLATE ORDER QUESTIONING THE ASSESSMENT MADE U /S. 158BD IN THAT CASE HAS BEEN SET ASIDE TO THE FILE OF THE LD CIT(A) BY THE TRIBUNAL FOR HIS FRESH CONSIDERATION BY GIVING OPPORTUNITY OF HEARING TO THE ASSESSEE. 5. THE LD. A.R. ON THE OTHER HAND TRIED TO JUSTIFY THE FIRST APPELLATE ORDER. HE PLACED R ELIANCE ON THE FOLLOWING DECISION : 1) 112 ITD 268 (PN) 2) 72 ITD 132 (PN) 3) ACIT V/S. THAKK A R DEVELOPERS LTD., ITA NO. 581/PN/2008 (BLOCK PERIOD 1977 - 78 TO 2003 - 04 ) DATED 26 TH JULY 2010. 4) SATYAPAL WASSAN, 295 ITR (AT) 352 ITA NO 962 /PN/200 8 SHRI JITENDRA M. THAKKAR BLOCK PERIOD 01.04.1996 TO 25.03.2003 PA GE OF 11 4 CONSIDERING THE ABOVE SUB MISSIONS, WE FIND THAT THE LD CIT(A) HAS HELD THE NOTICE ISSUED U/S. 158BD AGAINST THE ASSESSEE AS INVALID ON THE BASIS THAT SATISFACTION ARRIVED AT BY THE A.O AGAINST THE ASSESSEE WAS BASELESS. THE A.O DISBELIEVED AND DISALLOWED THE CASH PAYMENTS BASED ON THE SAME SEIZED DOCUMENT WHILE FRAMING ASSESSMENT IN THE CASE OF THE PERSON SEARCHED, I.E. M/S. RISHIRAJ BUILDERS & DEVELOPERS. THUS A.O COULD NOT HAVE COME TO A DIFFERENT CONCLUSION THAT THE SAME PAYMENTS WOULD FORM UNDISCLOSED INCOME OF THE PRESENT A SSESSEE. THE A.O, IN FACT TOOK A CONTRADICTORY STAND IN RESPECT OF TWO PERSONS, I.E. THE PERSON SEARCHED AND THE OTHER PERSON ON SAME SET OF FACTS AND EVIDENCE ON THE SAME ITEM. NOTING THESE MATERIAL FACTS, IN OUR VIEW THE LD. CIT(A) HAS RIGHTLY COM E TO THE CONCLUSION THAT THE CONTRADICTORY STAND ADOPTED BY THE A.O DOES NOT AMOUNT TO PROPER SATISFACTION TO INITIATE PROCEEDING U/S. 158BD OF THE ACT AGAINST THE ASSESSEE. WE THUS AFFIRM THIS ACTION OF THE LD CIT(A) IN HOLDING THE NOTICE ISSUED U/S. 15 8BD AGAINST THE ASSESSEE AS UNJUSTIFIED. 6. SO FAR MERITS OF ADDITION IS CONCERNED, WE FIND THAT THE A.O HAS DETERMINED THE UNDISCLOSED INCOME IN QUESTION IN THE HANDS OF THE ASSESSEE RELYING UPON THE ENTRIES MADE IN THE SEIZED DOCUMENTS FOUND DURING THE COURSE OF SEARCH AND SEIZURE OPERATIONS IN THE CASE OF M/S. RISHIRAJ BUILDERS & DEVELOPERS AND ITS PARTNERS, STATEMENTS OF SHRI Y.P. TRIVEDI RECORDED ON 21 ST MARCH 2005 AND HIS AFFIDAVIT DATED 21 ST MARCH 2005 IN RESPECT OF PLOT NOS. 33 AND 42. AS PER TH E SEIZED DOCUMENTS, AN AMOUNT OF RS. 9,45,000/ - WAS STATED TO HAVE BEEN PAID TO SHRI NARENDRA M. THAKKER AND HIS REPRESENTATIVE ON VARIOUS DATES IN RESPECT OF PLOT NO. 42 AND SIMILARLY, AN AMOUNT OF RS. 26,09,350/ - IN RESPECT OF PLOT NO. 33. THE ASSESSEE OBJECTED THE RELIANCE ON THE ENTRIES IN THE SAID SEIZED DOCUMENT DISOWNING THE CONTENTS OF THOSE SEIZED DOCUMENTS. IT WAS ALSO CONTENDED THAT IN HIS AFFIDAVIT, SHRI NARENDRA M. THAKKER (BROTHER OF THE ITA NO 962 /PN/200 8 SHRI JITENDRA M. THAKKAR BLOCK PERIOD 01.04.1996 TO 25.03.2003 PA GE OF 11 5 ASSESSEE) HAS DENIED RECEIPT OF ANY CASH AMOUNT FROM M/S. RISHIRAJ BUILDERS & DEVELOPERS AND THEIR ASSOCIATES. IT WAS SUBMITTED THAT THE A.O HIMSELF IN THE CASE OF M/S. RISHIRAJ BUILDERS & DEVELOPERS HAS DISBELIEVED AND DID NOT ALLOW THE SAID PAYMENTS WHILE FRAMING THE ASSESSMENT. EVEN AFFIDAVITS FILED BY S HRI Y.P. TRIVEDI REGARDING THE SAID CASH PAYMENTS MADE TO SHRI NARENDRA M. THAKKER BASED ON THE SEIZED DOCUMENT WERE NOT CONSIDERED BY THE A.O. THE A.O., HOWEVER, CONSIDERED THE CONTENTS OF SAME SEIZED DOCUMENT ALONG WITH THE AFFIDAVIT OF SHRI TRIVEDI FO R ASSUMING JURISDICTION U/S. 158 BD OF THE ACT AND FOR MAKING AN ADDITION IN THE HANDS OF THE ASSESSEE WITHOUT BRINGING ANY NEW EVIDENCE OR FRESH MATERIAL ON RECORD. IT WAS CONTENDED THAT THE A.O DID NOT MAKE ANY FURTHER EFFORTS TO BRING FURTHER MATERIAL FOR ESTABLISHING THAT THE CASH PAYMENTS MADE TO SHRI NARENDRA M. THAKKER AND HIS REPRESENTATIVES WERE ACTUALLY UNDISCLOSED INCOME OF SHRI JITENDRA M. THAKKER I.E. THE ASSESSEE. IT WAS SUBMITTED THAT THE A.O HAS APPLIED THE PREPONDERANCE OF PROBABILITIES WITHOUT THE PREPONDERANCE OF PROBABILITY BY ANY OTHER EVIDENCE OR MATERIAL ON RECORD. IT WAS CONTENDED BY THE ASSESSEE THAT NO RELATION NOR THE CASH PAYMENTS WERE ESTABLISHED BY THE A.O TO HIM IN CONNECTION WITH THE SAID PROPERTY TRANSACTIONS. IT WAS SU BMITTED THAT EVEN AT REMAND STAGE, THE A.O DID NOT BRING ON RECORD ANY EVIDENCE TO DISPROVE THE CONTENTS OF AFFIDAVIT DATED 26.3.2007 BY SHRI NARENDRA M. THAKKER DENYING THE RECEIPT OF ANY CASH PAYMENT AS MENTIONED IN THE ABOVE STATED SEIZED DOCUMENT. IT WAS POINTED OUT THAT IN THE CASE OF SHRI PARAJI ABAJI KARANJKAR, THE ACIT CENTRAL CIRCULE III, NASIK HAS EXAMINED SHRI NARENDRA M. THAKKER U/S. 131 OF THE ACT WHEREIN ALSO SHRI NARENDRA M. THAKKER HAS FLATLY DENIED ANY KNOWLEDGE ABOUT THE TRANSACTIONS. W E FIND FROM THE FIRST APPELLATE ORDER THAT THE LD CIT(A) WHILE ACCEPTING THE CONTENTION OF THE ASSESSEE THAT OPPORTUNITY TO CROSS - EXAMINE SHRI Y.P.TRIVEDI WAS NOT GRANTED TO THE ASSESSEE, HAD DIRECTED THE A.O TO GRANT THE OPPORTUNITY OF CROSS - EXAMINATION OF SHRI Y.P. TRIVEDI TO THE ASSESSEE. THE SAME WAS COMPLIED WITH. ON THE BASIS OF THAT CROSS - EXAMINATION GRANTED ON 3 RD MARCH ITA NO 962 /PN/200 8 SHRI JITENDRA M. THAKKAR BLOCK PERIOD 01.04.1996 TO 25.03.2003 PA GE OF 11 6 2008 , THE ASSESSEE MADE FOLLOWING SUBMISSIONS REPRODUCED AT PAGE NO. 20 & 21 OF THE FIRST APPELLATE ORDER : FROM THE CROSS - EXAM INATION OF SHRI Y.P. TRIVEDI, PARTNER OF M/S. RUSHIRAJ BUILDERS & DEVELOPERS, FOLLOWING POSITION EMERGES. 1.1 THE SEIZED DIARY, IN WHICH ALLEGED PAYMENTS TO NARENDRA THAKKER ARE NOTED, WAS WRITTEN BY SHRI. Y.P. TRIVEDI (PLEASE REFER SECOND PARA OF ANSWER TO Q.NO.13). 1.2 MR.Y.P. TRIVEDI, AUTHOR OF THE SEIZED DIARY, WAS NEITHER INVOLVED IN NEGOTIATION OF ANY OF THE TRANSACTIONS OF PLOT NOS. 33 AS WELL AS 42 NOR IN MAKING ACTUAL PAYMENTS AGAINST THE SAID TRANSACTIONS (PLEASE REFER SECOND PARA OF ANSWER TO Q .NO.13). 1.3 MR.Y.P. TRIVEDI NEVER MADE ANY PAYMENT TO MR. NARENDRA THAKKER OR ANY OF HIS FAMILY MEMBERS , IN RESPECT OF THE TRANSACTIONS RELATING TO PLOT NO.33 AND 42, ON ONE TO ONE BASIS (PLEASE REFER ANSWER TO Q.NO.14). 1.4 ENTRIES IN THE SEIZED DIAR Y WERE MADE BY SHRI Y.P. TRIVEDI ONLY ON THE BASIS OF INFORMATION SUPPLIED TO HIM BY ONE SHRI. AMULYA SHASTRI, WHICH INFORMATION WAS NEVER CROSS VERIFIED BY SHRI. Y.P. TRIVEDI FROM RECIPIENT OF MONEY (PLEASE REFER ANSWER TO Q.NO.15). 1.5 THE AFFIDAVIT S UBMITTED BY SHRI. Y.P. TRIVEDI, IN THE CASE OF M/S. RISHIRAJ BUILDERS AND DEVELOPERS WAS PREPARED AND SUBMITTED ON THE BASIS OF ENTRIES IN THE SEIZED DIARY AND REGISTER, WRITTEN ON THE BASIS OF UNCONFIRMED INFORMATION SUPPLIED BY SHRI. AMULYA SHASTRI (PL EASE REFER PARA 3 OF ANSWER TO Q.NO.12). THUS, IN VIEW OF THE INFORMATION, GIVEN DURING THE COURSE OF CROSS - EXAMINATION BY SHRI. Y.P.TRIVEDI, IT IS EVIDENT THAT, THE ENTRIES IN THE SEIZED DIARY AND REGISTER AND THE AFFIDAVIT PREPARED BY SHRI.Y.P. TRIVEDI ARE NOT BASED ON CONFIRMED INFORMATION. THUS, ALL THESE EVIDENCES CAN NOT BE USED AGAINST THE APPELLANT, IN SUPPORT OF THE ALLEGATION THAT APPELLANT RECEIVED ANY CASH FROM M/S. RUSHIRAJ BUILDERS AND DEVELOPERS, ITA NO 962 /PN/200 8 SHRI JITENDRA M. THAKKAR BLOCK PERIOD 01.04.1996 TO 25.03.2003 PA GE OF 11 7 IN CONNECTION WITH THE TRANSACTIONS OF PLO T NOS. 33 AND 42. THESE ARE NO GOOD EVIDENCES, WHICH CAN BE USED AGAINST APPELLANT. 2.1 AS REGARDS THE TRANSACTION OF PLOT NO.33 IT IS ADMITTED BY SHRI. Y.P.TRIVEDI THAT, THE SAID PLOT BELONGED TO MR. KARANJKAR AND MR. NAVANI, BY VIRTUE OF CONVEYANCE E XECUTED IN JULY, 1994 (PLEASE REFER ANSWERS TO Q.NO.5 & 6). IT WAS OBTAINED BY M/S. RISHIRAJ BUILDERS AND DEVELOPERS FROM SAID OWNERS OF PLOT NO. 33 I.E. MR. KARANJKAR AND MR. NAVANI, UNDER A REGISTERED DEVELOPMENT AGREEMENT AND A POWER OF ATTORNEY EXECUT ED IN 1997 (PLEASE REFER ANSWERS TO Q.NO.7). 2.2. IN ANSWER TO Q.NO.9 IT IS STATED BY SHRI Y.P. TRIVEDI, THAT A BUILDING WAS CONSTRUCTED ON PLOT NO. 33, WHICH, AS PER ANSWER TO Q.NO.11, WAS SOLD TO PRATIKSHA CO.OP.HOUSING SOCIETY BY A SALE DEED EXECUTED IN 1998. IN THIS SALE DEED ALSO THE EXECUTING PARTIES ARE 1. MR. KARANJKAR AND MR. NAVANI (OWNERS OF LAND AS VENDORS) 2. M/S. RUSHIRAJ BUILDERS AND DEVELOPERS (DEVELOPER OF PROPERTY AS CONFIRMING PARTY) AND 3. PRATIKSHA CO.OP. HOUSING SOCIETY (SOCIETY OF HOLDERS OF RESIDENTIAL UNITS AS PURCHASER). IT IS CONCEDED BY SHRI. Y.P. TRIVEDI IN THE CONCLUDING PART OF ANSWER TO Q.NO.11 THAT, NONE OF THE THAKKERS WERE EITHER PARTY TO ANY OF THE DOCUMENTS IN RELATION TO PLOT NO.33 OR WERE PAID ANY CONSIDERATION AGAINST THE TRANSACTION OF PLOT NO.33 UNDER ANY OF THE SAID DOCUMENTS. 2.3 IT IS ALSO CONCEDED BY SHRI. Y.P. TRIVEDI (SECOND PARA OF ANSWER TO Q.NO.13 ON PAGE NO.7) THAT, ALONG WITH THE NAME OF NARENDRA THAKKER NAMES OF PATEL AND BHANUBHAI ALSO APPEARED IN THE NOTINGS IN THE SEIZED DIARY. HOWEVER, HE FAILED TO PROPERLY EXPLAIN, WHY THE PAYMENTS SHOULD BE TREATED AS MADE TO NARENDRA THAKKER AND NOT TO PATEL OR TO BHANUBHAI. HE ALSO FAILED TO BRING OUT ANY REASON FOR MAKING PAYMENTS TO NARENDRA THAKKER, I N RELATION TO THE TRANSACTION OF PLOT NO. 33, WHEN HE WAS NOT A PARTY TO ANY OF THE DOCUMENNTS OR HAD ANY INTEREST IN THE PROPERTY AT PLOT NO. 33. FURTHER, NO REASON FOR ALLEGING THE CASH PAYMENTS TO THE APPELLANT (I.E.JITENDRA THAKKER) IS COMING OUT OF ANY OF THE DOCUMENTS, STATEMENT OF SHRI. Y.P. TRIVEDI, SEIZED MATERIAL, AFFIDAVIT OF SHRI. Y.P.TRIVEDI AND HIS CROSS - EXAMINATION. ITA NO 962 /PN/200 8 SHRI JITENDRA M. THAKKAR BLOCK PERIOD 01.04.1996 TO 25.03.2003 PA GE OF 11 8 FROM THE ABOVE, IT IS EVIDENT THAT, THERE IS NO VALID REASON FOR M/S.RUSHIRAJ BUILDERS AND DEVELOPERS TO MAKE ANY PAYMENT TO THE APPELLANT AGAINST THE TRANSACTION OF PLOT NO. 33. 3. IN ANSWER TO Q.NO.12, IT IS STATED BY SHRI. Y.P. TRIVEDI, THAT THE PROPERTY AT PLOT NO. 42 ORIGINALLY BELONGED TO MAHARASHTRA PRABODHAN SEVA MANDAL, WHICH WAS GIVEN ON DEVELOPMENT AGREEMENT TO M/S . PRASAD DEVELOPERS . M/S. PRASAD DEVELOPERS, IN ITS TURN ENTERED INTO AN AGREEMENT OF SALE FOR PLOT NO. 42 WITH MR. PARAJI KARANJKAR. IT IS ON THE STRENGTH OF THE RIGHTS ACQUIRED BY SHRI. PARAJI KARANJKAR, UNDER THE AGREEMENT TO SALE WITH M/S. PRA SAD DEVELOPERS, M/S. RUSHIRAJ BUILDERS AND DEVELOPERS ENTERED INTO DEVELOPMENT AGREEMENT WITH MR. PARAJI KARANKAR. IT WAS ONLY BECAUSE THE RIGHTS OF MR. KARANJKAR WERE UNDER AN AGREEMENT TO SALE, M/S. PRASAD DEVELOPERS AND MAHRASHTRA PRABODHAN SEVA M ANDAL WERE ADDED AS CONFIRMING PARTY IN THE DEVELOPMENT AGREEMENT. IT IS CONCEDED BY SHRI. Y.P. TRIVEDI IN HIS ANSWER TO Q.NO. 12 THAT, AS PER THE DEVELOPMENT AGREEMENT, M/S. RUSHIRAJ BUILDERS AND DEVELOPERS, DID NOT PAY ANY CONSIDERATION TO MAHARASHTR A PRABODHAN SEVA MANDAL OR M/S. PRASAD DEVELOPERS. IT IS FURTHER CONCEDED IN ANSWER TO Q.NO.12, BY SHRI. Y.P. TRIVEDI THAT, THAKKER WERE NOT A PARTY, IN THEIR OWN CAPACITY, TO THE DEVELOPMENT AGREEMENT. THUS, IN ABSENCE OF ANY RIGHT IN THE PROPERTY OF PL OT NO. 42 THERE CAN NOT BE ANY REASON FOR M/S. RUSHIRAJ BUILDERS AND DEVELOPERS TO MAKE ANY PAYMENT TO THAKKER. IN VIEW OF THE INFORMATION COMING OUT OF THE CROSS - EXAMINATION OF SHRI.Y.P. TRIVEDI, THERE IS NO REASON FOR M/S. RISHIRAJ BUILDERS AND DEVELOPE RS TO MAKE ANY PAYMENT TO APPELLANT. FURTHER, MR. Y.P. TRIVEDI IS ALSO NOT SURE OF THE RECIPIENT OF THE PAYMENT MADE BY HIM. IN ANY CASE THE NAME OF APPELLANT IS ABSENT IN ANY OF THE SEIZED DOCUMENT AND REASON FOR RECEIPT OF ON - MONEY BY APPELLANT ALSO D OES NOT EXIST. UNDER THE CIRCUMSTANCES, THERE IS NO BASIS FOR A.O. TO TREAT THAT, THE ON - MONEY WAS RECEIVED BY APPELLANT IN THE TRANSACTIONS OF PLOT NO. 33 AND 42. THEREFORE, IN VIEW OF THE EARLIER SUBMISSIONS MADE AND THE SUBMISSIONS MADE HEREIN ABOVE, I T IS EARNESTLY REQUESTED TO DELETE THE ADDITION OF RS. 29,04,350/ - MADE TO THE RETURNED NIL UNDISCLOSED INCOME DECLARED BY APPELLANT. ITA NO 962 /PN/200 8 SHRI JITENDRA M. THAKKAR BLOCK PERIOD 01.04.1996 TO 25.03.2003 PA GE OF 11 9 7. IT WAS ALSO SUBMITTED THAT THERE WAS NO VALID REASON FOR M/S. RISHIRAJ BUILDERS AND DEVELOPERS TO MAKE ANY PAYMEN T TO THE ASSESSEE AGAINST THE PROPERTY TRANSACTION OF PLOT NO. 33 OR 42 IN THE ABSENCE OF ANY RIGHT BY THE ASSESSEE IN THE SAID PROPERTIES. IT WAS CONTENDED FURTHER THAT THE NAME OF THE ASSESSEE WAS ABSENT IN ANY OF THE SEIZED DOCUMENTS AND THERE WAS NO R EASON FOR RECEIPT OF ON - MONEY BY HIM. IN HIS REMAND REPORT DATED 17.3.2008, THE A.O SUBMITTED BEFORE THE LD CIT(A) THAT SHRI SHASTRI WAS A TRUSTED MAN OF SHRI Y.P. TRIVEDI. THEREFORE, SHRI Y.P. TRIVEDI WAS FULLY AWARE OF THE ACTUAL FACTS AND CONSULTATI ON IN RESPECT OF THE PROPERTY TRANSACTIONS WITH SHRI NARENDRA THAKK A R, WHO IS A BROTHER OF THE ASSESSEE. THE A.O REPORTED FURTHER THAT THE OTHER NAME APPEARING IN THE SAID SEIZED DOCUMENTS WERE NOTHING BUT THE REPRESENTATIVES OF SHRI NARENDRA THAKKAR. FUR THER, THE A.O REPORTED THAT SHRI JITENDRA M. THAKKAR WAS GPA HOLDER OF THE PROPERTIES MENTIONED IN THE SEIZED DOCUMENTS AND THE FACT THAT SHRI SHASTRI HELD NEGOTIATIONS WITH SHRI NARENDRA THAKKER IS ENOUGH TO HOLD THAT THE PAYMENTS WERE MADE TO THE ASSESS EE. CONSIDERING THESE MATERIAL FACTS OF THE CASE, WE ARE OF THE VIEW THAT THE LD CIT(A) HAS RIGHTLY OBSERVED THAT THE STAND OF THE A.O IS NOT ACCEPTABLE BECAUSE THE SEIZED DOCUMENTS WAS MAINTAINED BY SHRI Y.P. TRIVEDI BASED ON THE INFORMATION SUPPLIED BY ONE SHRI SHASTRI AND THERE WAS NO EVIDENCE ON RECORD CONFIRMING THE TRANSACTIONS FROM SHRI SHASTRI. THUS, THE ENTRIES BASED ON THE UNCONFIRMED TRANSACTIONS CANNOT BE USED AS EVIDENCE AGAINST THE ASSESSEE. 8. THE ASSESSEE ALSO DENIED HIS ROLE IN THE TRAN SACTION IN RESPECT OF PLOT NO.33. THE STAND OF THE A.O IN THIS REGARD REMAINED THAT THE ASSESSEE WAS HOLDER OF GENERAL POWER OF ATTORNEY FOR THE TOTAL LAY OUT OF THE PLAN. THE A.O ALSO MENTIONED THAT SHRI Y.P. TRIVEDI IN HIS STATEMENTS DATED 21 ST MARCH 2 005 ADMITTED THAT HE HAD NEGOTIATIONS WITH SHRI NARENDRA M. THAKKER THOUGH PLOT NO. 33 WAS PURCHASED FROM SHRI PARAJI ABAJI KARANJKAR AND SHRI RAJESH NAVANI. SHRI TRIVEDI IN HIS CROSS - EXAMINATION HAS, HOWEVER, CONTRADICTED HIS STATEMENTS ITA NO 962 /PN/200 8 SHRI JITENDRA M. THAKKAR BLOCK PERIOD 01.04.1996 TO 25.03.2003 PA GE OF 11 10 GIVEN ON 21 ST MA RCH 2005. IN ANSWER TO QUESTION NO. 11, HE STATED THAT NO NE OF THE THAKKERS WERE EITHER PARTY TO ANY DOCUMENT IN RELATION TO PLOT NO. 33 OR WERE PAID ANY CONSIDERATION AGAINST PLOT NO.33 UNDER ANY OF THE SAID DOCUMENT. UNDER THESE CIRCUMSTANCES, IN OUR VIEW, LD CIT(A) HAS RIGHTLY OBSERVED THAT STATEMENTS AND AFFIDAVITS GIVEN BY SHRI Y.P. TRIVEDI CANNOT BE RELIED UPON DUE TO CONTRADICTIONS IN HIS STATEMENTS AND AFFIDAVITS WITHOUT ANY VALID CORROBORATIVE EVIDENCE. IN RESPECT OF TRANSACTION OF PLOT NO. 42 AS WELL, THERE IS NO CORROBORATIVE EVIDENCE BROUGHT ON RECORD BY THE A.O EITHER IN THE ASSESSMENT ORDER OR IN THE SUBSEQUENT ENQUIRIES REGARDING THE CASH PAYMENT IN THIS REGARD TO SHRI NARENDRA M. THAKKER , BROTHER OF SHRI JITENDRA THAKKER I.E. THE ASSESS EE. WE FULLY AGREE WITH THE VIEW OF THE LD CIT(A) THAT MERE RELIANCE ON THE SEIZED DOCUMENTS ALONE IS NOT ENOUGH FOR MAKING AN ADDITION OF UNDISCLOSED INCOME IN THE HANDS OF THE ASSESSEE JUST BECAUSE HE WAS THE GPA HOLDER IN RESPECT OF SOME PROPERTIES. FOLLOWING SEVERAL DECISIONS OF HONBLE COURTS RELIED BEFORE THE JABALPUR BENCH OF THE TRIBUNAL IN THE CASE OF SATYAPAL WASSAN (SUPRA), THE JABALPUR BENCH H AS OBSERVED AS UNDER : THE CRU X OF THESE DECISIONS IS THAT A DOCUMENT FOUND DURING THE COURSE OF SEARCH MUST BE A SPEAKING ONE AND WITHOUT ANY SECOND INTERPRETATION, MUST REFLECT ALL THE DETAILS ABOUT THE TRANSACTIONS OF THE ASSESSEE IN THE RELEVANT ASSESSMENT YEAR. ANY GAP IN THE VARIOUS COMPONENTS AS MENTIONED IN SECTION 4 OF THE INCOME - TAX ACT MUS T BE FILLED UP BY THE ASSESSING OFFICER THROUGH INVESTIGATIONS AND CORRELATIONS WITH THE OTHER MATERIAL FOUND EITHER DURING THE COURSE OF THE SEARCH OR ON INVESTIGATION. THE PUNE BENCH OF THE TRIBUNAL IN THE CASE OF ACIT V/S. THAKKAR DEVELOPERS LTD. (SU PRA) HAS ALSO FOLLOWED THE DECISION OF MUMBAI BENCH OF THE TRIBUNAL IN THE CASE OF SATRAPTAX (INDIA) PVT. LTD., 84 ITD 320 (MUM) HOLDING THAT THE PRESUMPTION U/S. 132(4A) IS APPLICABLE ONLY AGAINST THE PERSON FROM WHOSE POS SESSION THE BOOKS OF ACCOUNTS OR OTHER DOCUMENTS WERE FOUND AND NOT AGAINST ANY OTHER PERSON. IN THE PRESENT CASE BEFORE US, SUCH PRESUMPTION HAS ITA NO 962 /PN/200 8 SHRI JITENDRA M. THAKKAR BLOCK PERIOD 01.04.1996 TO 25.03.2003 PA GE OF 11 11 NOT BEEN SUCCESSFULLY REBUTTED BY THE REVENUE TO MAKE THE ADDITION IN QUESTION IN THE HANDS OF THE ASSESSEE WHILE FRAMING ASSESSMENT U/S. 1 58BD AGAINST HIM. 9. THE LD CIT(A) HAS RIGHTLY HELD THAT IN ABSENCE OF ANY CORROBORATIVE EVIDENCE NO VALUE CAN BE ATTACHED TO THE SEIZED DOCUMENTS UNDER THE FACTS AND CIRCUMSTANCES OF THE PRESENT CASE. THE FIRST APPELLATE ORDER ON THE ISSUE IS COMPREH ENSIVE AND REASONED ONE. WE ARE THUS NOT INCLINED TO INTERFERE WITH. THE SAME IS UPHELD . THE GROUNDS QUESTIONING THE ACTION OF LD CIT(A) IN HOLDING THE NOTICE ISSUED U/S. 158 BD AGAINST THE ASSESSEE AS UN JUSTIFIED AND IN DELETING THE ADDITION OF RS.29, 04,350/ - AS UNDISCLOSED INCOME IN THE HANDS OF THE ASSESSEE ARE THUS REJECTED. CONSEQUENTLY, THE APPEAL IS DISMISSED. THE ORDER IS PRONOUNCED IN THE OPEN COURT ON 23RD FEBRUARY 201 1 . SD/ - SD/ - ( D. KARUNAKARA RAO ) ACCOUNTA NT MEMBER ( I.C. SUDHIR ) JUDICIAL MEMBER PUNE , DATED THE 23RD FEBRUARY , 20 1 1 US COPY OF THE ORDER IS FORWARDED TO : 1. THE A PPELLANT 2. THE RESPONDENT 3. THE CIT I , NASHIK 4. THE CIT(A) - I I , NASHIK 5. THE D.R. A BENCH, PUNE 6. GUARD FILE BY ORDER ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL PUNE