DCIT, CHENNAI V. Smt. Sancy Devi & Others, CHENNAI

ITSSA 116/CHNY/2001

• Counselvise Citation: [2012] 124 COUNSELVISE.COM (IT) 7707 (ITAT-CHENNAI)
• Duration Of Justice: 10 year(s) 6 month(s) 9 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 16-03-2012
• Appeal Filed By: Department
• Order Result: Partly Allowed
• Bench Allotted: B
• Next Hearing Date: 07-03-2012
• Assessment Year: misc
• Appeal Filed On: 07-09-2001
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: R B NAIKC I T
• Assessee Lawyers: V D GOPAL

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL BENCH B CHENN AI BEFORE SHRI N.S.SAINI, ACCOUNTANT MEMBER AND SHRI GEORGE MATHAN, JUDICIAL MEMBER .. IT(SS)A NO.98/MDS./2001 BLOCK PERIOD END ING 03.09.98 SMT.SANCY DEVI & OTHERS, (L/H LATE SHRI NARENDRA KUMAR MEHTA) 111A,SUBBARAYAN STREET, NAMMALWARET, CHENNAI 600 012. VS. DEPUTY COMMISSIONER OF INCOME TAX, CITY CIRCLE IV(2), CHENNAI. PAN 13711 N (APPELLANT) (RESPONDENT) IT(SS)A NO.116/MDS./2001 BLOCK PERIOD ENDIN G 03.09.98 DEPUTY COMMISSIONER OF INCOME TAX, CITY CIRCLE IV(2), CHENNAI. VS. SMT.SANCY DEVI & OTHERS, (L/H LATE SHRI NARENDRA KUMAR MEHTA) 111A,SUBBARAYAN STREET, NAMMALWARET, CHENNAI 600 012. PAN 13711 N (APPELLANT) (RESPONDENT) DEPARTMENT BY : SHRI R.B.NAIK,C.I.T. DR ASSESSEE BY : SHRI V.D.GOPAL, ADVOCATE DATE OF HEARING : 07.03.12 DATE OF PRONOUNCEMENT : 16.03.1 2 O R D E R PER GEORGE MATHAN JUDICIAL MEMBER : IT(SS)A NO.98/MDS/2001 IS AN APPEAL FILED BY THE ASSESSEE AND IT(SS)A NO.116/MDS/2001 IS AN APPEAL FILED BY IT(SS)A 98/MDS/01 IT(SS)A 116/MDS/01 2 THE REVENUE AGAINST THE ORDER OF LD. COMMISSIONER O F INCOME TAX(A) IV, CHENNAI IN APPEAL NO.354/2000-01 DATED 18.06.2001 FOR THE BLOCK PERIOD ENDING 03.09.1998. 2. SHRI V.D.GOPAL, ADVOCATE REPRESENTED ON BEHALF OF THE ASSESSEE AND SHRI R.B. NAIK, LD.C.I.T. DR REPRESENT ED ON BEHALF OF THE REVENUE. 3. IT WAS SUBMITTED BY LD. AUTHORISED REPRESENTATI VE OF THE ASSESSEE THAT THE ASSESSEE WAS IN THE BUSINESS OF P AWN BROKING. IT WAS THE SUBMISSION THAT THERE WAS A SE ARCH AND SEIZURE OPERATION ON THE PREMISES OF THE ASSESSEE O N 03.09.98 AND ASSESSMENT U/S.158 BA CAME TO BE COMPLETED ON 28.09.2000, WHEREIN THE ASSESSING OFFICER HAD ASSES SED UNDISCLOSED INCOME OF THE ASSESSEE AT ` 20 LAKHS ON THE BASIS OF STATEMENT RECORDED FROM THE ASSESSEE IN THE COUR SE OF SEARCH. IT WAS THE SUBMISSION THAT ON APPEAL BEFOR E THE COMMISSIONER OF INCOME TAX(A), LD. COMMISSIONER OF INCOME TAX(A) HAD CONFIRMED AN ADDITION OF RS.15,29,809/- BEING AN ALLEGED DIFFERENCE BETWEEN THE DUES ON THE ADVANCES MADE BY THE ASSESSEE AND THE OUTSTANDING DUES SHOWN IN THE TRIAL BALANCE AS ON 31.03.98. IT WAS THE SUBMISSION THAT THE DIFFERENCE BETWEEN THE AMOUNT OF ` 15,29,809/- AND ` 20 LAKHS IT(SS)A 98/MDS/01 IT(SS)A 116/MDS/01 3 WAS ESTIMATED ADDITION MADE BY THE ASSESSING OFFICE R TOWARDS THE MARRIAGE EXPENSES INCURRED BY THE ASSESSEE FOR HIS ELDEST DAUGHTER MARRIAGE. IT WAS THE SUBMISSION THAT NO EV IDENCE HAD BEEN FOUND IN THE COURSE OF SEARCH TO SHOW THAT THE ASSESSEE HAD ANY UNDISCLOSED INCOME AS ASSESSED BY THE ASSES SING OFFICER. IT WAS THE SUBMISSION THAT AGAINST THE CO NFIRMATION OF THE ADDITION OF ` 15.29 LAKHS, THE ASSESSEE WAS IN APPEAL. AGAINST THE DELETION OF THE MARRIAGE EXPENSES, THE REVENUE WAS IN APPEAL. IT WAS THE SUBMISSION THAT AS NO EV IDENCE WAS AVAILABLE IN THE COURSE OF SEARCH, NO ADDITION WAS LIABLE TO BE MADE JUST BY RELYING UPON STATEMENT RECORDED IN THE COURSE OF SEARCH. HE RELIED UPON THE DECISION OF THE HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF S. KHADER KHAN SON REPORTED IN [2008] 300 ITR 157 (MAD.), AS ALSO THE DECISION OF THE HONBLE JURISDICTIONAL HIGH COURT IN THE CASE O F M.NARAYANAN AND BROS. REPORTED IN [2011] 339 ITR 192 (MDS.). IN REPLY LD. DR SUBMITTED THAT THE ADDITIO N HAD BEEN MADE ON THE BASIS OF THE STATEMENT RECORDED IN THE COURSE OF SEARCH, WHICH WAS ALSO CORROBORATED BY THE EVIDENCE FOUND IN THE COURSE OF SEARCH. HE VEHEMENTLY SUPPORTED THE ORDER OF THE ASSESSING OFFICER. IT(SS)A 98/MDS/01 IT(SS)A 116/MDS/01 4 4. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. WE H AVE ALSO PERUSED THE ASSESSMENT ORDER AND THE ORDER OF THE COMMISSIONER OF INCOME TAX(A). PERUSAL OF THE ASS ESSMENT ORDER SHOWS THAT THE ASSESSING OFFICER HAS BASED HI S ASSESSMENT OF THE UNDISCLOSED INCOME AT ` 20 LAKHS ON THE BASIS OF THE STATEMENT RECORDED FROM THE ASSESSEE A T THE TIME OF SEARCH. THOUGH THE ASSESSING OFFICER MENTIONS T HAT THE SAID STATEMENT IS CORROBORATED BY THE ENTRIES IN TH E BOOKS OF ACCOUNT FOUND AT THE TIME OF SEARCH, THE SAME DOES NOT HOLD WATER INSOFAR AS THE LD. COMMISSIONER OF INCOME TAX (A) HIMSELF HAS CATEGORICALLY FOUND THAT THE ADDITION M ADE REPRESENTING THE MARRIAGE EXPENSES OF THE ASSESSEE S DAUGHTER COULD NOT BE TREATED AS UNDISCLOSED INCOME OF THE ASSESSEE AS THERE WAS NO EVIDENCES FOUND IN THE COU RSE OF SEARCH THAT SUPPORTED THE ADDITION. FURTHER, PERUS AL OF THE ASSESSMENT ORDER SHOWS THAT LD. ASSESSING OFFICER HAS NOT APPLIED WITH THE PROVISIONS OF SEC.158BB(1) INSOFAR AS THE COMPUTATION OF THE TOTAL UNDISCLOSED INCOME IS NOT IN LINE WITH THE PROVISIONS OF SEC.158BB(1). AS THE COMPUTATION IS NOT AS PER THE PROVISIONS OF SEC.158BB(1), IT WOULD NOT BE POSSIBLE TO DETERMINE AS TO WHICH YEAR THE UNDISCLOSED INCOME R ELATES TO OR AS TO HOW THE SAME WAS DETERMINED. AS THIS HAS LED TO THE IT(SS)A 98/MDS/01 IT(SS)A 116/MDS/01 5 TECHNICAL BREACH IN THE ORDER, WE ARE OF THE VIEW T HAT THIS ISSUE WOULD HAVE TO BE RESTORED TO THE FILE OF THE ASSESS ING OFFICER FOR REDOING THE ASSESSMENT AS PROVIDED UNDER CHAPTE R XIV B OF THE ACT AND WE DO SO. IN THE CIRCUMSTANCES WITHO UT GOING INTO THE MERITS OF THE ADDITIONS AND THE DELETIONS, THE ISSUES IN THESE APPEALS ARE RESTORED TO THE FILE OF THE ASSES SING OFFICER FOR DENOVO ASSESSMENT. IN THE CIRCUMSTANCES, THE A PPEAL OF THE ASSESSEE AND THE APPEAL OF THE REVENUE ARE PART LY ALLOWED FOR STATISTICAL PURPOSES. 5. IN RESULT, THE APPEAL OF THE ASSESSEE AND THE A PPEAL OF THE REVENUE ARE PARTLY ALLOWED FOR STATISTICAL PURP OSES. ORDER PRONOUNCED ON 16 TH MARCH, 2012. SD/- SD/- ( N.S.SAINI ) (GEORGE MATHAN ) ACCOUNTANT MEMBER JUDICIAL MEMBER CHENNAI, DATED THE 16 TH MARCH, 2012. K S SUNDARAM COPY TO: ASSESSEE/AO/CIT (A)/CIT/D.R./GUARD FILE IT(SS)A 98/MDS/01 IT(SS)A 116/MDS/01 6