Appeal Details
Counselvise Citation
[2011] 124 COUNSELVISE.COM (IT) 7888 (ITAT-DELHI)
Assessee PAN
Bench
Appeal Number
CRN Number
Duration Of Justice
4 year(s) 6 month(s) 12 day(s)
Appellant
Respondent
Appeal Type
Income Tax (Search & Seizure) Appeal
Pronouncement Date
23-12-2011
Appeal Filed By
Department
Order Result
Dismissed
Bench Allotted
C
Next Hearing Date
03-11-2011
Assessment Year
misc
Appeal Filed On
11-06-2007
Judgement Text
IN THE INCOME TAX APPELLATE TRIBUNAL DELHI C BENC H BEFORE SHRI C.L. SETHI, JM & SHRI A.N. PAHUJA, AM IT(SS)A NO.127/DEL/2007 BLOCK PERIOD: 01.04.1995 TO 22.08.2001 ASSISTANT COMMISSIONER OF INCOME-TAX,CENTRAL CIRCLE-1, ROOM NO.322, E-2,ARA CENTRE, JHANDEWALAN EXTN., NEW DELHI V/S . M/S DYNAMIC UNIVERSAL LTD., 2/10, SHANTI NIKETAN, NEW DELHI [PAN NO.:AAACD 3043 K] (APPELLANT) (RESPONDENT) ASSESSEE BY S/SHRI VED JAIN, & SMT. RANO JAIN,ARS REVENUE BY SHRI H.L. DIHANA, DR DATE OF HEARING 03-11-2011 DATE OF PRONOUNCEMENT 23-12-2011 O R D E R A.N. PAHUJA: THIS APPEAL FILED ON 11.06.2007 BY THE REVENUE AGAI NST AN ORDER DATED 16.03.2007 OF LEARNED CIT(A)-III, NEW D ELHI, RAISES THE FOLLOWING GROUNDS:- ON THE FACTS AND IN LAW AND IN THE CIRCUMSTANCES O F THE CASE, THE LEARNED CIT(A) HAS ERRED IN: I) DELETING THE ADDITION OF ` `4,30,00,000/- MADE BY THE AO ON ACCOUNT OF UNACCOUNTED CASH RECEIVED FROM SHRI DINESH JAIN AND FAMILY AS SALE CONSIDERATION O F FLATS. II) DELETING THE ADDITION OF ` ` 31,25,000/- MADE BY THE AO ON ACCOUNT OF UNEXPLAINED INCOME RECEIVED AS ADJUSTMENT AMOUNT FROM SHRI DINESH JAIN. III) DELETING THE ADDITION OF ` `97,11,030/- MADE ON ACCOUNT OF AMOUNT RECEIVED FROM SHRI DINESH JAIN. IV) DELETING THE ADDITION OF ` ` 33,09,900/- ON ACCOUNT OF CASH RECEIVED FROM PRAVEEN ARORA AND FAMILY. IT(SS)A NO.127/D/2007 2 2. ADVERTING FIRST TO GROUND NOS.(I) TO (III) IN T HE APPEAL RELATING TO ADDITIONS OF ` ` 4,30,00,000/- IN RESPECT OF UNACCOUNTED CASH RECEIV ED FROM SHRI DINESH JAIN & FAMILY; ` 31,25,000/- ON ACCOUNT OF ADJUSTMENT AMOUNT AND ` 97,11,030/- ON ACCOUNT OF AMOUNT RECEIVED FROM SH. DINESH JAIN, FA CTS, IN BRIEF, AS PER RELEVANT ORDERS ARE THAT A SEARCH U/S 132 OF THE INCOME-TAX ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT) WAS CONDUCTED IN THE PREMISES OF D. N. TANEJA GROUP ON 22.08.2001,WHEREIN CERTAIN INCRIMINATING DOCUMENTS AND BOOKS OF ACCOUNTS RELATING TO THE ASSESSEE WERE ALSO SEIZED. CONSEQU ENTLY, A NOTICE U/S 158 BD READ WITH SECTION 158BC OF THE ACT WAS ISSUED ON 26 TH JULY, 2002. IN RESPONSE, THE ASSESSEE FILED RETURN DECLARING NIL UNDISCLOSED INCOME ON 09.09.2002. THE BLOCK ASSESSMENT IN THIS CASE WAS INITIALLY COMPLET ED ON AN INCOME OF ` ` 5,50,36,030/- ON THE BASIS OF PAGE 24 OF ANNEXURE-A -1 SEIZED FROM THE PREMISES AT 7, KG MARG, NEW DELHI. 2.1. ON APPEAL, THE LD. CIT(A) REDUCED THE ADDITION TO ` ` `4,30,00,000/-. VIDE ORDER DATED 27.8.2004. ON FURTHER APPEAL BY THE AS SESSEE AND THE REVENUE, THE ITAT VIDE THEIR ORDER DATED 26.08.2005 IN IT(SS) A NO. 336/DEL./2004 SET ASIDE THE ORDER OF THE LD. CIT(A) AND REMANDED THE MATTER BACK TO THE FILE OF AO FOR FRESH CONSIDERATION IN THE FOLLOWING TERMS:- 45. THE CASE OF THE REVENUE, HOWEVER, THAT PAGES 2 3 AND 25 OF ANNEXURE A-1 IS NOT A DUMB DOCUMENT. IT CONTAINS TH E ACTUAL RECEIPT OF TANEJA GROUP ON BEHALF OF THE ASSESSEE I N RESPECT OF THE SALE OF PROPERTIES AT PALM COURT PROJECT AT GURGAON AND OTHER FAMILY MEMBERS AS WELL AS HUFS AND COMPANIES AND TH AT THE PAGE IS A STATEMENT OF ACCOUNT OF SHRI DINESH JAIN GIVIN G THE DETAILS OF PAYMENTS RECEIVED BY THE ASSESSEE FROM HIM AND THE NAME OF THE ASSESSEE AND SHRI DINESH JAIN ARE MENTIONED ON THE AFORESAID PAPER IS THOUGH NOT FULLY SUPPORTED BY DIRECT EVIDE NCE BUT IF SEEN WITH REFERENCE TO OTHER CIRCUMSTANCE AND THE MATERI AL/FACT IT CLEARLY ESTABLISHES THE CASE OF THE REVENUE THAT CASH WAS A LSO RECEIVED BY THE ASSESSEE OVER AND ABOVE THE CHEQUE RECEIPTS APP EARING IN IT(SS)A NO.127/D/2007 3 PAGES 23 AND 25 OF ANNEXURE 'A' AND ACCOUNTED FOR B Y THE ASSESSEE IN ITS BOOKS OF ACCOUNT. 47. ON CONSIDERATION OF RIVAL SUBMISSIONS WE NOTICE THAT THE COMMERCIAL FLATS AT THE GROUND FLOOR AND 3RD FLOOR, SOLD TO DINESH JAIN GROUP WERE FOUND TO BE AT THE PRICE LOWER THAN THE PRICE OF OTHER COMMERCIAL FLATS ON THE SAME FLOOR OR OTHER F LOORS. THE RATES MENTIONED IN MEMORANDUM OF UNDERSTANDING FILED IN R ESPECT OF BOOKING ADVANCES RECEIVED FROM M/S. ANTRIKSH LAND P ROMOTERS P. LTD. M/S. SHREE JAGANATH SECURITIES (P) LTD. BOTH A T THE RATE OF 1,400 PER SQ.FT. THAT TOO FOR 5TH FLOOR, M/S. LAL C ONSTRUCTION (P) LTD. AT THE RATE OF 1,150 PER SQ.FT. FOR 7TH FLOOR AND M /S. CHANDRA ADVERTISING (P) LTD. AT THE RATE OF 1,250 PER SQ. F T. FOR 6TH FLOOR AS AGAINST RS. 1,000 PER SQ. FT. FOR GROUND FLOOR AND RS.900 PER SQ. FT. FOR 3RD FLOOR IN THE CASE OF SALES TO DINESH JAIN. IT IS WHEN THE COMMERCIAL VALUE OF PROPERTY SITUATED AT GROUND FLO OR IN ANY COMMERCIAL COMPLEX/ MALLS BEING BEST SUITED FOR OPE RATING A SHOW ROOM OR A SHOP CAN EVEN BE TWICE OR THRICE THE RATE OF PROPERTY SITUATED AT FIRST FLOOR OF THE SAME COMMERCIAL COMP LEX WHICH REDUCES AS ONE MOVE TOWARDS UPPER FLOOR I.E. 1ST FL OOR TO SEVENTH FLOOR. IN THE CASE OF DINESH JAIN, SURPRISINGLY, TH E POSITION IS REVERSED I.E. THE RATES OF GROUND FLOOR COMMERCIAL FLATS SOLD TO DINESH JAIN GROUP WAS G RS.1,000 PER SQ. FT. I.E., EVEN LESS THAN THE RATES OF 7TH FLOOR FLATS SOLD TO OTHER PARTIES AT T HE RATE OF RS.1, 150 PER SQ. FT. IN ABSENCE OF ANY EXPLANATION, THEREFOR E, THE RATES REFLECTED FOR SALE OF COMMERCIAL FLATS TO DINESH JA IN GROUP MAY GIVE AN IMPRESSION OF HIGHLY UNDERSTATEMENT AND THIS MAY BE A FACTOR CONFIRMING THE FACT THAT, DINESH JAIN GROUP HAS ALS O GIVEN OTHER PAYMENTS OVER AND ABOVE THE CHEQUE PAYMENTS AS CONT AINED IN THE SEIZED DOCUMENT I.E., PAGE NOS. 23 AND 25 OF AN NEXURE A-1, AND A FURTHER INFERENCE THAT THESE PAGES BELONG TO THE ASSESSEE- COMPANY AND MAY NOT DUMB DOCUMENTS. BUT THE ASSESSE E HAS NEVER BEEN GIVEN THESE DETAILS NOR WAS ASKED TO EXP LAIN THE SAME. IT(SS)A NO.127/D/2007 4 48. THAT SHRI D.N. TANEJA SEEMS TO HAVE MADE A WRON G STATEMENT AND HE WAS IN FACT THE MAIN CONTROLLING PERSON OF T ANEJA GROUP INCLUDING THE PALM COURT PROJECT AT GURGAON AND THA T FACT IS EVIDENT FROM: '(1) THAT IN ALL THE STATEMENTS RECORDED BY D DIT (INV.) ON 17-9- 2001, 24-9-2001, 24-9-2001 AND BY DCIT, CC-18 ON 27 -5-2003, SHRI S.K. DEWAN, DIRECTOR OF APPELLANT-COMPANY HAS ADMITTED AGAIN AND AGAIN THAT ALL THE DEALS REGARDING SALE OF FLAT S OF PALM COURT PROJECT WERE UNDERTAKEN SETTLED ONLY BY SHRI D.N. T ANEJA AND ON SELLING PRICES SHRI DEWAN ALSO HAD SOME DISPUTE WIT H SHRI D.N. TANEJA. BESIDES THIS, IT WAS ALSO ADMITTED THAT BOT H CHEQUE AS WELL AS CASH PAYMENTS WERE RECEIVED BY HIM ONLY THROUGH SHRI D.N. TANEJA. THUS ESTABLISHING THE FACT THAT SHRI D.N. T ANEJA WAS VERY MUCH INVOLVED IN THE PALM COURT PROJECT; (2) THAT T HOUGH INITIALLY SHRI D.N. TANEJA HAS DENIED OF HAVING ANY CONNECTIO N WITH PAGES 23 TO 25 OF ANNEXURE A-1 AND WITH PALM COURT PROJEC T, HOWEVER, LATER ON, VIDE HIS REPLY DATED 6-2-2002 TO DDIT (IN V.), HE ADMITTED THAT THIS DEAL WAS MADE THROUGH HIM STATING THAT: ' AS FAR AS THE TRANSACTION WITH MR. DINESH JAIN IS CONCERNED, THE SAME HAS BEEN NEGOTIATED IN MY OFFICE IN THE PRESENCE OF MR. AND MRS. DEWAN ALONG WITH MR. RAVINDER TANEJA.'; (3) THAT SIMILARL Y, PAGE NO. 2 OF ANNEXURE A-54 SEIZED FROM 9, K.G. MARG, NEW DELHI W HICH IS A DULY SIGNED LETTER FROM SHRI DINESH JAIN TO SHRI D.N. TA NEJA REQUESTING HIM TO RESOLVE THE LONG PENDING ISSUES RELATED TO P URCHASE OF PALM COURT PROJECT; AND (4) THAT THE REFERENCE OF SHRI V IPIN SHARMA, WHO WAS INVOLVED IN MATERIALIZING ALL THE DEAL WITH DIN ESH JAIN GROUP, HAS ALSO BEEN FOUND ON PAGE NO. 25 OF ANNEXURE A- I SEIZED FROM THE RESIDENCE OF SHRI D.N. TANEJA. THUS, ESTABLISHI NG THE FACT THAT SHRI D.N. TANEJA WAS THE MAIN CONTROLLING PERSON OF THIS PROJECT.' 49. THAT WRONG STATEMENTS WERE ALSO GIVEN BY SHRI R AVINDER TANEJA, DIRECTOR OF APPELLANT-COMPANY ON 14-7-2003 BEFORE THE ASSESSING OFFICER IS EVIDENT FROM THE FACT THAT HE HAS GIVEN INCORRECT ANSWERS TO CERTAIN QUESTIONS WHICH ARE APPARENTLY C ONTRADICTORY TO MATERIAL ON RECORD, NAMELY '(1) SHRI RAVINDER TANEJ A VIDE Q. NO. 6 OF HIS STATEMENT BEFORE THE ASSESSING OFFICER HAS S TATED THAT 'I DO NOT KNOW ANY PERSON NAMED VIPIN SHARMA' WHEREAS ALM OST ALL THE IT(SS)A NO.127/D/2007 5 'AGREEMENT TO SELL' AND 'SALE DEEDS' EXECUTED IN FA VOUR OF DINESH JAIN GROUP WERE DULY WITNESSED BY SHRI VIPIN SHARMA S/O. SHRI TRILOK NATH. FURTHER, ON EXAMINING THE AGREEMENT TO SELL, SHRI VIPIN SHARMA WAS ALSO FOUND HAVING HIS OFFICE IN THE NAME OF M/S. SVS DEVELOPERS (P) LTD. AT 807, PRAKASH DEEP, 7, TOLSTO Y MARG, NEW DELHI- 1; (2) ON PERUSAL OF PAGE NOS. 4 TO 7 OF ANN EXURE A- I SEIZED FROM 7, M.G. MARG, NEW DELHI REFLECTING THEREIN THE CASH RECEIPT OF RS. 3,01,50,000, IT IS SEEN THAT THE PAYMENTS WERE MAINLY THROUGH SHRI VIPIN SHARMA BETWEEN MAY 20 TO JUNE 22; (3) VI DE Q. NO. 2 OF SHRI S.K. DEWAN'S STATEMENT RECORDED ON 24-9-2001 B EFORE THE DDIT (INV.), SHRI DEWAN IDENTIFIED SHRI VIPIN SHARM A AS A BROKER WORKING FOR SHRI D.N. TANEJA AND RESIDING AT GREATE R KAILASH-1. FURTHER, DURING THE COURSE OF APPELLATE PROCEEDINGS , HE SUPPLIED THE ADDRESS OF SHRI VIPIN SHARMA AS M/S. SVS PROPMA RT (P) LTD. 18, JACARANDA MARG, DLF CITY-II, GURGAON, HARYANA'. BUT HE WAS NOT ASKED TO EXPLAIN THE EXISTENCE OF THE DOCUMENTS AT PAGES 23, 24 AND 25. 50. THE FACT THAT THE ENTRIES OF CHEQUE PAYMENTS AP PEARING ON THIS SEIZED PAPER, WHICH HAVE BEEN RECEIVED BY THE APPEL LANT ARE IN TOTAL AGREEMENT WITH THE ENTRIES APPEARING IN THE A PPELLANT'S BOOKS OF ACCOUNT CANNOT BE TAKEN LIGHTLY AND IT MAY NOT B E POSSIBLE TO SAY THAT THE ENTRIES OF CHEQUES ARE CORRECT BUT THAT OF CASH PAYMENTS ARE INCORRECT. THEREFORE, THIS SEIZED DOCUMENT MAY NOT BE A DUMB DOCUMENT BUT VERY MUCH RELATES TO THE APPELLANT-COM PANY. 51. FURTHER ANOTHER MOST CRUCIAL MATERIAL NOTED BY THE CIT(A), WHICH ACCORDING TO HIM CLEARLY ESTABLISHES THAT THE EXECUTION OF AGREEMENTS TO SELL IN RESPECT OF SALE OF GROUND AND 3RD FLOOR PROPERTIES TO DINESH JAIN GROUP IN PALM COURT PROJE CT WAS ENTERED INTO NOT ON THE DATE SPECIFIED THERE IN THE AGREEME NT TO SELL I.E. 10/11-4-2000 BUT ON A MUCH LATER DATE, MAY BE ON 15 -8-2000 I.E. THE DATE MENTIONED ON PAGE NOS. 23, 24 AND 25 OF AN NEXURE A-1, IS THE PARA 6 READING : 'IN TERMS OF THE COLLABORATION AGREEMENT THE BUILDER CAUSED A PLAN BEARING NO. 1155 /ME DATED 3- 9-1997 TO BE SANCTIONED BY THE MUNICIPAL COMMITTEE, GURGAON FOR CONSTRUCTION IT(SS)A NO.127/D/2007 6 OF THE SAID OFFICE- CUM-COMMERCIAL COMPLEX ON THE S AID PLOT OF LAND A COMPLETION CERTIFICATE BEARING NO. 2363 DATE D 11-5-2000 WAS ISSUED BY THE MUNICIPAL COMMITTEE, GURGAON THER EOF.' IF THE AGREEMENTS TO SELL WERE ACTUALLY PREPARED ON 10/11- 4-2000, THEN HOW A DATE LATER THAN THAT I.E. 11-5-2000 CAN APPEA R IN THESE AGREEMENTS TO SELL WITH DINESH JAIN GROUP? IT MAY B E THAT THESE AGREEMENTS WERE EXECUTED ON A MUCH LATER DATE I.E. ON OR AFTER 15- 8-2000 THE DATE MENTIONED IN PAGES 23, 24 AND 25 OF ANNEXURE W. THIS VIEW WOULD GET SUPPORT FROM THE FACT THAT NOT EVEN A SINGLE CHEQUE ISSUED IN COMPLIANCE TO PARAGRAPH 2 OF PAGE 4 OF THESE AGREEMENTS TO SELL I.E. RS.2,00,000 WAS TO BE GIVEN AT THE TIME OF SIGNING THIS AGREEMENT, WAS DEPOSITED INTO THE APPE LLANT'S BANK ACCOUNT IN THE MONTH OF APRIL, 2000 TO AUGUST, 2000 . THE EARLIEST DATE OF DEPOSITING THE CHEQUE WAS 4-9-2000. FURTHER , ALL FORM NO. 34A, NEEDING CLEARANCE FOR SALE OF PROPERTY WERE EI THER FILED ON A DATE LATER THAN 15-8-2000 OR ISSUED BY THE INCOME T AX DEPARTMENT IN THE MONTH OF SEPTEMBER, 2000. THEREFORE, IT SEEM S THAT THE PREPARATION OF AGREEMENTS TO SELL DATED 10/11-4-200 0 WAS AN ARRANGED AFFAIR AND THE AGREEMENTS MIGHT HAVE ACTUA L BEEN EXECUTED ON A LATER DATE AND THUS, CONFIRMING THAT THE DATE APPEARING ON PAGE NOS. 23 AND 24, I.E. 15-8-2000, W AS THE DATE ON WHICH BOTH THE PARTIES AGREED TO PURCHASE THE PROPE RTIES AT GROUND AND 3RD FLOOR OF PALM COURT PROJECT. 52. WE DO NOT FIND ANY ANSWER TO THE ABOVE MENTIONE D ISSUES AND THE CONCLUSION OF CIT(A) IS WITHOUT GIVING PROPER O PPORTUNITY OF BEING HEARD AND EXPLAINING THE MATERIAL RELIED UPON BY HIM, NAMELY, WHY THE SELLING PRICE OF GROUND FLOOR COMME RCIAL FLATS SOLD TO DINESH JAIN GROUP WAS LOWER THAN THE SELLING PRI CE OF COMMERCIAL FLATS AVAILABLE AT 7TH FLOOR. IS IT SO IN OTHER COM MERCIAL COMPLEXES; HOW A DATE LATER THAN THE DATE OF EXECUTION OF AGRE EMENTS TO SELL I.E. 11-5-2000 IS APPEARING IN THE AGREEMENTS TO SE LL PREPARED ON 10/11-4-2000; WHY THE CONDITION SPECIFIED IN PARAGR APH 2 OF PAGE 4 OF THESE AGREEMENTS TO SELL I.E. ISSUE OF CHEQUE OF RS. 2,00,000 AT THE TIME OF SIGNING THE AGREEMENT WAS NOT ACTED UPO N; WHY WRONG STATEMENTS WAS GIVEN BY SHRI RAVINDER TANEJA, DIREC TOR OF M/S. IT(SS)A NO.127/D/2007 7 ELITE PROMOTERS (P) LTD. THAT HE DID NOT KNOW ANY P ERSON NAMED SHRI VIPIN SHARMA WHEREAS ALL THE AGREEMENTS TO SEL L OF DINESH JAIN GROUP WAS DULY WITNESSED BY HIM; AND WHY SHRI D.N. TANEJA HAS GIVEN WRONG STATEMENT BY STATING THAT HE IS NOT INVOLVED WITH PALM COURT PROJECT WHEREAS SHRI S.K. DEWAN, DIRECTO R OF APPELLANT- COMPANY HAS CONFIRMED THAT THE DEALS OF PALM COURT WERE EXECUTED BY SHRI TANEJA. 53. IN THE PRESENT CASE, SURPRISINGLY HOWEVER, THE ASSE SSING OFFICER HAS CONCLUDED THAT THE ASSESSEE HAS SOLD PALM COURT PROPERTY TO SHRI DINESH JAIN AT A TOTAL CONSIDERATION OF RS. 7, 74,29,500 OUT OF WHICH ONLY RS.2,40,00,300 WAS ACCOUNTED FOR IN THE BOOKS AND BALANCE RS.5,34,29,200 WAS RECEIVED IN CASH WHICH W AS NOT ENTERED IN THE BOOKS OF ACCOUNT AND INCLUDING INTER EST THEREON OF RS.15,06,830 HE ADDED A SUM OF RS.5,50,36,030 IN TH E CASE OF THE ASSESSEE EVEN AFTER EXAMINING SHRI DINESH JAIN, THE CASH RECEIPT FROM WHOM WAS DENIED BY D.N. TANEJA AND ALSO BY RAV INDER TANEJA WHO DENIED OF HAVING ANY TRANSACTION IN ANY PROPERTY OF FARMHOUSE OR HAVING ANY LOSS INCURRED WITH RESPECT THERETO. IT IS ALSO NOT ON RECORD AS TO WHAT HAS HAPPENED IN THE C ASE OF DINESH JAIN AND HIS GROUP CASE FOR ASSESSMENT OF THE ALLEG ED PAYMENT IN CASH BY THEM. CIT(A) GIVES CERTAIN FINDINGS BUT WIT HOUT GIVING AN OPPORTUNITY TO THE ASSESSEE TO EXPLAIN THE SAME. HE QUOTES CERTAIN EXAMPLES OF SALES AT HIGHER RATES BUT AGAIN WITHOUT CONFRONTING THE SAME TO THE ASSESSEE AND TO EXPLAIN. SHRI RAVINDER JAIN WAS NOT PUT TO QUESTION ABOUT THE DOCUMENT CONTAINING THE D ETAILS OF CASH AND CHEQUES PAYMENTS AND OTHER NOTINGS STATED TO HA VE BEEN TAKEN BY D.N. TANEJA FROM HIS DRAWER, THE DOCUMENT ON WHICH CASE OF THE REVENUE IS HEAVILY STANDS. THESE ARE ALL THI NGS TO BE SEEN AND THE ASSESSEE HAS TO BE GIVEN PROPER OPPORTUNITY TO EXPLAIN THE MATERIAL USED AGAINST HIM BEFORE TAKING A FINAL DEC ISION. WE ACCORDINGLY SET ASIDE HIS ORDER AND ALSO THAT OF TH E ASSESSING OFFICER AND REMIT THE MATTER BACK TO HIS FILE FOR C ONSIDERATION OF THE ISSUE AFRESH AFTER AFFORDING A REASONABLE OPPORTUNI TY TO THE ASSESSEE TO EXPLAIN THE MATTER AND THE MATERIAL BEI NG USED AGAINST HIM. IT(SS)A NO.127/D/2007 8 2.2 IN PURSUANCE TO THE AFORESAID DIRECTIONS OF THE ITAT, THE AO RECONSIDERED THE MATTER IN DISCUSSION WITH REPRESENTATIVES OF TH E ASSESSEE. THE AO NOTICED THAT THE ASSESSEE COMPANY IN COLLABORATION WITH M/S ELITE PROMOTORS (P) LTD. ,A COMPANY PROMOTED BY TANEJA FAMILY, DEVELOPED A PROP ERTY NAMED PALM COURT AT GURGAON WITH AN AGREEMENT THAT SALE CONSIDERATI ON WOULD BE EQUALLY SHARED BY THE PARTIES. THE AO POINTED OUT THAT PAGE 24 OF ANNEXURE-21 SEIZED DURING THE COURSE OF SEARCH REVEALED A PRINTED ACCOUNT OF SHRI DINESH JAIN CONTAINING RECEIPTS BY CHEQUES AND CASH FOR THE PERIOD 23 RD MAY, 2000 TO 26 TH NOVEMBER, 2000. THE HEADING ON THE SAID PAGE IMPLIED THAT TH IS WAS THE ACCOUNT OF DYNAMIC UPTO 26 TH MAY, 2001 WHEREAS THE ENTRIES WERE RECORDED ONLY UPTO 26 TH NOVEMBER, 2000. AS PER PAGE 24, THE AMOUNT OF CASH RECEIVED BY DYNAMIC UNIVERSAL LTD. IS `4,30,00,000/- AS BELOW:- DATE AMOUNT [IN ` `] 30.08.2000 60,00,000/- 04.12.2000 25,00,000/- 13.09.2000 1,20,00,000/- 25.10.2000 1,00,00,000/- 30.10.2000 20,00,000/- 23.11.2000 28,00,000/- 26.11.2000 25,00,000/- CASH `4,30,00,000/- 2.21 THE TOTAL OF CHEQUES RECEIVED AS PER PAGE 24 WAS ` `2,40,00,030/-, WHICH WAS IN TOTAL AGREEMENT WITH THE BOOKS OF ACCOUNTS A ND THE DETAILS NARRATED BY THE AO WERE AS FOLLOWS:- DATE AMOUNT[IN ` `] 12.07.2000 24,00,000/- 04.09.2000 85,69,800/- 15.09.2000 45,03,000/- 22.09.2000 15,24,000/- 28.09.2000 44,03,500/- 05.12.2000 22,00,000/- 19.12.2000 4,00,000/- `2,40,00,300/- IT(SS)A NO.127/D/2007 9 2.22 IN ADDITION TO THE ABOVE CHEQUES, CERTAIN ADJ USTMENTS APPEARED ON THE PAGE MENTIONED HEREUNDER: 15.08.2000 ADJ ` ``20,83,500/- (1/3 RD LOSS OF FARM HOUSE TOTAL ` ` `62.50)` ` `10,41,500 -(50% OF VIPIN SHARMAS 1/3 RD OF LOSS). THERE IS ALSO AN AMOUNT OF ` ``97,11,030/- TO BE RECEIVED AS APPEARING ON THIS PAGE. 2.3 TO A QUERY BY THE AO, SEEKING EXPLANATION FOR T HE ENTRIES ON THE AFORESAID SEIZED DOCUMENT, THE ASSESSEE REPLIED THAT DOCUMENT PAGE 24 OF ANNEXURE-A1 WAS NOT SEIZED FROM THE PREMISES OF THE ASSESSEE. THE ASSESSEE ALSO CATEGORICALLY DENIED HAVING ENTERED IN TO ANY TRAN SACTION WITH ANY PERSON IN CASH. HOWEVER, THE AO POINTED OUT CERTAIN FACTS T O THE ASSESSEE IN QUESTIONNAIRE DATED 27.12.2005 MENTIONED IN PARA 7. 3 OF THE ASSESSMENT ORDER. SINCE NONE RESPONDED TO THIS QUESTIONNAIRE DESPIT E SEEKING ADJOURNMENT ON 5.1.2006, THE AO ISSUED ANOTHER QUESTIONNAIRE DATE D 16.1.2006 MENTIONED IN PARA 7.4 OF THE ASSESSMENT ORDER.. AGAIN NONE RESPO NDED TO THIS QUESTIONNAIRE DESPITE SEEKING ADJOURNMENT ON 27.1.2006.FINALLY AN OTHER QUESTIONNAIRE WAS ISSUED ON 20.2.2006 AS MENTIONED IN PARA 7.5 OF TH E ASSESSMENT ORDER,. NONE RESPONDED TO THIS QUESTIONNAIRE ALSO. ACCORDINGLY, AFTER NARRATING THE FACTS FOUND BY THE ITAT IN THEIR AFORESAID ORDER DATED 26.8.200 5, IN PARA 7.6 OF THE ASSESSMENT ORDER, THE AO OBSERVED THAT PAGE 24 OF A NNEXURE A-1, WAS NOT A DUMB DOCUMENT, SINCE THE CHEQUE PAYMENTS APPEARING ON THAT PAGE WERE IN TOTAL AGREEMENT WITH THE ENTRIES IN THE BOOKS OF TH E ASSESSEE AND IF ENTRIES RELATING TO CHEQUE PAYMENTS WERE CORRECT, IT COULD NOT BE HELD THAT THE ENTRY RELATING TO CASH PAYMENTS WERE INCORRECT. ACCORDIN GLY, THE AO CONCLUDED THAT THE AMOUNT OF ` ` `4,30 LACS RECEIVED IN CASH FROM SHRI DINESH JAIN A ND HIS FAMILY MEMBERS ON ACCOUNT OF SALE OF PROPERTIES UPTO 20 TH MAY, 2001 WAS UNACCOUNTED INCOME OF THE ASSESSEE. WHILE REFERRING TO THE OBS ERVATIONS OF THE ITAT, THE ASSESSING OFFICER MENTIONED AS UNDER:- 7.7 B) THE PAGES WERE FOUND FROM THE PREMISES OF SH. D N TANEJA AT 7, KG MARG, NEW DELHI. SHRI D.N. TANE JA WAS VERY MUCH INVOLVED IN THE TRANSACTIONS AS IT IS EVIDENT IT(SS)A NO.127/D/2007 10 FROM HIS LETTER DATED 6.2.2002, STATEMENTS OF SHRI S.K.DEWAN AND THE FACTS ALREADY DISCUSSED IN THE PRECEDING PARAS. THERE IS NOTHING ABNORMAL IN FINDI NG THESE PAPERS AT HIS PREMISES. IT MAY BE MENTIONED T HAT THE FOLLOWING PAPERS REGARDING PALM COURT PROJECT W ERE FOUND AT HIS PREMISES AND SH. D N TANEJA HAS NOT DE NIED HIS KNOWLEDGE AND ROLES REGARDING THESE TRANSACTION S. (I) REGARDING PAGE 26 OF ANNEXURE A-I FOUND AT 7, K G MARG, NEW DELHI, CONTAINING DETAILS OF ALLEGED ADVANCES RECEIVED FROM PARTIES FOR PALM COURT PROPERTIES, SH. D N TANEJA HAS STATED AS PER HIS LETTER DATED 6/2/02, THAT THIS CONTAINS PAYMENTS RECEIVED BY ACCOUNT PAYEE CHEQUES. (II) REGARDING PAGES 5,7,AND 11 OF ANNEXURE A-2 FOU ND AT 7, K G MARG, RELATING TO SALE OF PALM COURT PROPERTIES TO SH. PRAVEEN ARORA, SH. D N TANEJA HAS FILED CERTAIN DETAILS REGARDING THESE TRANSACTIONS. (III) SH. DINESH JAIN IN HIS STATEMENT RECORDED ON 24/3/03 CONFIRMED THAT HE PURCHASED THE PROPERTIES FROM THE ASSESSEE, M/S SANA INTERNATIONAL (P) LTD, M/S SHAKTI OVERSEAS (P) LTD THROUGH SH. D N TANEJA INSPITE OF THE FACT THAT SH. D N TANEJA WAS NOT A DIRECTOR IN THESE COMPANIES. THEREFORE, THE SUBMISSIONS OF SH. D N TANEJA THAT H E WAS NOT A DIRECTOR IN THE ASSESSEE COMPANY, HE WAS NOT INVOLVED IN THE TRANSACTIONS WITH REGARD TO PALM CO URT PROPERTIES, HE WAS NOT AWARE OF THE CONTENTS OF THE SEIZED PAPERS AND THAT THE PAPERS FOUND AT HIS RESIDENCES HAS NOTHING TO DO WITH THE ASSESSEE COMPANY CANNOT BE ACCEPTED. SH. D N TANEJA HAS MADE WRONG SUBMISSIONS AND STATEMENTS IN ORDER TO AVOID THE PAYMENT OF ADD ITIONAL TAX ON THE UNACCOUNTED CASH RECEIPTS FROM SH. DINES H JAIN AND FAMILY. C) SHRI RAVINDER TANEJA HAS MADE WRONG STATEMENT THAT HE DID NOT KNOW ANY PERSON NAMED 'VIPIN SHARMA' IN ORDER TO AVOID CONFIRMING THE CONTENTS OF THE PAGES 23 TO 25 OF A-I WHEREIN THE NAME OF SHRI VIPIN SHARMA PROMINENTLY FIGURED IN THE PAGES. IN FACT SH. VIPIN SHARMA WAS THE BROKER AND A WITNESS TO IN MOST OF THE AGREEMENTS TO SELL. D) THE PREPARATION AND EXECUTION OF AGREEMENT TO S ELL WERE AN ARRANGED AFFAIR, BETWEEN THE PARTIES IN AN EFFORT TO IT(SS)A NO.127/D/2007 11 AVOID PAYING TAXES ON THE CASH TRANSACTIONS. THE EXECUTION OF AGREEMENTS TO SELL WERE ENTERED INTO N OT ON THE DATE SPECIFIED IN THE AGREEMENTS TO SELL IS 10 TH AND 11 TH APRIL 2000 BUT ON A MUCH LATTER DATE, I.E, ON 15. 8.00, THE DATE MENTIONED ON PAGE NO.23 OF A-I. IN THE AGREEMENTS TO SELL DATED 10.4.00 AND 11.4.00, THE D ATE LATER THAN THAT, I.E. 11.5.00 APPEARS AS ' ..... A COMPLETION CERTIFICATE BEARING NO.2363 DATED 4.5.00 WAS ISSUED BY THE MUNICIPAL COMMITTEE, GURGAON ... ' WHICH MEANS THE AGREEMENTS WERE EXECUTED ON A MUCH LATER DATE. IT IS CONFIRMED BY T HE DATES OF DEPOSITING CHEQUES, WHICH WERE NOT EARLIER THAN 9.9.00. IT MAY BE STATED THAT AS PER STATEMENT OF S HRI RAVINDER TANEJA, DATED 14.7.03, REGISTRY IS MADE AF TER RECEIVING FULL AMOUNT ONLY. MOREOVER, ITCC NEEDED F OR SALE OF PROPERTY WERE FILED EITHER ON A DATE LATER THAN 15.8.00 OR ISSUED BY THE INCOME-TAX DEPARTMENT IN T HE MONTH OF SEPTEMBER, 2000. IT IS SEEN FROM THE CONTE NTS OF THE PAGE THAT THE ASSESSEE PAID INTEREST ON ALL RECEIPTS BEFORE 15-8-2000 AND CHARGED INTEREST ON ALL RECEIP TS RECEIVED AFTER 15-8-2000. THEREFORE, THE PREPARATIO N OF AGREEMENTS TO SELL, DATED 10.4.00 AND 11.4.00 WAS A N ARRANGED AFFAIR, CONFIRMING THE DATE APPEARING ON P AGE 23 AND 24 OF A-I I.E. 15.8.2000, WHICH WAS THE DATE ON WHICH BOTH PARTIES AGREED TO PURCHASE THE PROPERTIES. E) ON THE BASIS OF MEMORANDUM OF UNDERSTANDING FIL ED IN RESPECT OF BOOKING ADVANCES BY DIFFERENT PARTIES, T HE COMPARATIVE RATES OF COMMERCIAL FLATS AT DIFFERENT FLOORS OF'PALM COURT' WERE AS FOLLOWS: SI. NAME OF PURCHASER (AS FLOOR AREA TOTAL SALE COST SQ. FT. NO. PER MOUS) (SQ.FT.) CONSIDERATIO N 1. JAGANNA TH SECURITIES 5 TH 6500 91,00,000 1,400 P. LTD. 2. ANTRIKSH LAND 5 TH 5015 70,21,000 1,400 I PROMOTERS P LTD 3. C HANDRA ADVERTSING P 6 TH 1155] ] ,44,38,750 1,250 LTD 4. 7 TH LAL CONSTRUCTION PVT. LTD 11542 1,32,73,300 1,150 5. DINESH JAIN GROUP GROUND 13648.5 1,34,68,500 1,000 IT(SS)A NO.127/D/2007 12 6. DINESH JAIN GROUP 3 RD 11702 1,05,31,800 900 THE PERUSAL OF THE ABOVE CHART REVEALS THAT THE SAL E CONSIDERATION OF COMMERCIAL FLAT SOLD TO SH. DINESH JAIN GROUP WAS IN FACT MUCH LOWER THAN THE PURCHASERS'. THE PRICE OF FLATS IN GROUND FLOOR OR THIRD FLOOR CANNO T BE LOWER THAN THE 6 TH OR 7 TH FLOOR. IT IS A KNOWN FACT THAT A PROPERTY LOCATED AT THE GROUND FLOOR OF A SHOPPING OR COMMERCIAL COMPLEX IS BEST SUITED FOR OPERATING A SHOWROOM OR A SHOP AND THE COMMERCIAL VALUE OF THE PROPERTIES AT THE GROUND FLOOR IS THE MAXIMUM. THUS , CONFIRMING THE FACT THAT THE ASSESSEE HAS RECEIVED CASH PAYMENTS OVER AND ABOVE THE CHEQUE PAYMENTS. (F) DURING THE COURSE OF THE ASSESSMENT PROCEEDING S IN SPITE OF GIVING AMPLE OPPORTUNITIES, THE ASSESSEE C OULD NOT FILE ANY EXPLANATION OR ANY CORROBORATIVE EVIDE NCE REGARDING THE INFERENCES DRAWN BY WAY OF FILING OR EXPLAINING ;- (I) EVIDENCES TO SHOW THAT THE COMMERCIAL VALUES OF GROUND FLOORS AND THIRD FLOORS IN SHOPPING MALLS OR COMMERCIAL COMPLEXES ARE LOWER THAN THOSE OF OTHER FLOORS, SAY 6 TH FLOOR OR 7 TH FLOORS. (II) EVIDENCES TO SHOW THAT THE AVERAGE CONSTRUCTIO N COST OF THE GROUND FLOOR AND THIRD FLOOR WERE LOWER THAN THE AVERAGE CONSTRUCTION COST OF THE OTHER FLOORS. (III) VALID REASONS AS TO WHY A DATE LATER THAN THE EXECUTION OF AGREEMENTS TO SELL, I.E, 11/5/00 IS APPEARING IN THE AGREEMENTS TO SELL PREPARED ON 10 TH AND 11 TH APRIL, 2000. (IV) WHY THE CONDITION SPECIFIED IN PARA 2 OF PAGE 4 OF THE AGREEMENTS TO SELL, I.E., ISSUE OF CHEQUE OF IT(SS)A NO.127/D/2007 13 RS. 2,00,000/- AT THE TIME OF SIGNING THE AGREEMENT WAS NOT ACTED UPON. (V) WHY WRONG STATEMENT WAS GIVEN BY SH. RAVINDER TANEJA, DIRECTOR IN THE ASSESSEE COMPANY THAT HE DID NOT KNOW ANY PERSON BY THE NAME OF SH. VIPIN SHARMA WHEREAS ALL THE AGREEMENT TO SELL REGARDING DINESH JAIN GROUP WAS DULY WITNESSED BY HIM. (VI) WHY SH. D N TANEJA HAS GIVEN WRONG STATEMENT BY STATING THAT HE IS NOT INVOLVED WITH PALM COURT PROJECT WHEREAS AMPLE EVIDENCES REGARDING HIS INVOLVEMENT WERE FOUND AND THAT SH. S K DEWAN HAS ALSO CONFIRMED THAT THE DEALS OF PALM COURT WERE EXECUTED BY SH. D N TANEJA. THE FAILURE TO FILE THE ABOVE EXPLANATIONS AND EVIDENCES BY THE ASSESSEE ESTABLISHED THE FACT THAT IN ADDITION TO THE CHEQUE PAYMENTS, THE ASSESSEE HAS ALSO RECEIVED CASH PAYMENTS FROM SH. DINESH JAIN ON ACCOUNT OF SALE OF PALM COURT PROPERTIES. 2.4 AS REGARDS ADJUSTMENT OF ` 31,25,000/- ON ACCOUNT OF LOSS IN FARM HOUSE IN GROUND NO.(II) IN THE APPEAL, THE AO POINTED OUT TH AT THE ASSESSEE DENIED KNOWLEDGE OF ANY SUCH TRANSACTION. IN THE LIGHT OF HIS AFORESAID CONCLUSION THAT PAGES 23 TO 25 OF ANNEXURE-A-1 OF SEIZED DOCUMENT W ERE NOT DUMB DOCUMENTS AND IT WAS ESTABLISHED THAT SHRI D.N. TANEJA FROM WHOSE PREMISES THESE PAPERS WERE FOUND, WAS THE MAIN CONTROLLING PERSON OF THE PALM COURT PROJECT, THE AO OBSERVED THAT IT COULD NOT BE SAID THAT ALL OTHER ENTRIES APPEARING IN THESE PAGES PERTAIN TO SHRI DINESH JAIN AND THE ENTRY REGARDING ADJUSTMENT OF ` `31,25,000/- DOES NOT RELATE TO THE ASSESSEE. SINCE THE ONUS WAS ON THE ASSESSEE TO EXPLAIN THE TRANSACTIONS AND THE ASSESSEE DID NOT DISCHARGE THE ONUS DESPITE AMPLE OPPORTUNITY PROVIDED, ACCORDINGLY, THE AO CONCLUDED THAT THE AMOUNT OF ` `31,25,000/- REPRESENTED UNEXPLAINED INCOME OF THE ASSESSEE FOR SALE OF PALM COURT PROPERTIES RECEIVED FROM SHRI DINESH JAIN . 2.5 REGARDING INTEREST OF ` ` `73,04,200/- AND ` ` `24,06,830/- AS PER GROUND NO.(III) IN THE APPEAL, THE AO NOTICED THAT THE ASS ESSEE DID NOT FILE ANY DETAILS DURING THE ASSESSMENT PROCEEDINGS NOR SUBMITTED ANY EXPLANATION DESPITE IT(SS)A NO.127/D/2007 14 SUFFICIENT OPPORTUNITY ALLOWED.. SINCE THE ASSESSE E PAID INTEREST @12.5% ON ALL RECEIPTS BEFORE 15 TH AUGUST, 2000 AND RECEIVED INTEREST AT THE SAME RAT E ON ALL RECEIPTS AFTER 15 TH AUGUST, 2000 AND THE AMOUNT OF ` ` `97,11,030/- HAVE NOT BEEN RECEIVED BEFORE 20 TH MAY, 2001 BUT WAS RECEIVED BEFORE THE DATE OF SEAR CH, THE AO ADDED THE AMOUNT BY WAY OF UNACCOUNTED INCOME OF THE ASSESSEE ,RECEIVED FROM SHRI DINESH JAIN. 3. ON APPEAL, THE LEARNED CIT(A) CALLED FOR A REMAN D REPORT FROM THE AO ON THE WRITTEN SUBMISSIONS FILED ON BEHALF OF THE ASSE SSEE. DURING REMAND PROCEEDINGS, THE AO AFFORDED REASONABLE OPPORTUNITY TO THE ASSESSEE AND RECORDED STATEMENTS OF SHRI DINESH JAIN ON 6.12.200 6, SHRI RAVINDER TANEJA ON 2.1.2007 AND SHRI DN TANEJA ON 22.1.2007 AND AFTER , HAVING COMMENTS OF THE ASSESSEE ON THE REMAND REPORT OF THE AO, THE LD. CI T(A) CONCLUDED AS UNDER:- 4.12 I HAVE CONSIDERED FACTS OF THE CASE, REASONING GIVEN BY THE ASSESSING OFFICER FOR MAKING ADDITION, BOTH THE I.T .A.T. ORDERS IN WHICH THE HON'BLE I.T.A.T. HAD SET ASIDE THE ISSUES OF AFORE SAID ADDITIONS, SUBMISSION AND COUNTER COMMENTS GIVEN BY THE AR OF THE APPELLANT COMPANY, REMAND REPORT ALONG WITH ENCLOSURES AS SUB MITTED BY THE ASSESSING OFFICER AND RELEVANT JUDICIAL DECISIONS I NCLUDING JUDICIAL DECISIONS RELIED UPON BY THE AR OF THE APPELLANT CO MPANY QUITE CAREFULLY. DURING THE COURSE OF SEARCH OPERATION ON SHRI D.N. TANEJA GROUP CASES, CERTAIN PAPER, I.E., PAGES 23 AND 24 OF ANNE XURE A-1, WAS ALSO SEIZED FROM THE PREMISES AT 7 K.G. MARG, NEW DELHI. THIS PAPER REVEALED CERTAIN CASH AND CHEQUE PAYMENTS AND THE HEADING OF THE PAPER READ 'DYNAMIC ACCOUNT UPTO 20 TH MAY, 2001'. ADMITTEDLY THIS WAS PLAIN PAPER WITHOUT ANY SIGNATURE AND IT WAS IN THE FORM OF A C OMPUTER PRINT OUT. THE AO PRESUMING THIS TO BE THE ACCOUNT OF THE SALE OF PROPERTY OF THE APPELLANT TO SHRI DINESH JAIN GROUP ISSUED NOTICE. UNDER SECTION 158D. THE AO'S PRESUMPTION WAS THAT THIS IS ON ACCOUNT OF THE SALE OF PROPERTY BY THE APPELLANT TO SHRI DINESH JAIN GROUP WHEREAS THE APPELLANT'S CONTENTION IS THAT THIS PAPER HAS NOTHING TO DO WIT H IT AND HE HAS NOT RECEIVED ANY CASH OVER AND ABOVE WHAT IS STATED IN THE BOOKS OF ACCOUNT. AS PER THE APPELLANT THIS IS A PLAIN PAPER UNSIGNED AND THE AO WAS NOT JUSTIFIED IN DRAWING A PRESUMPTION THAT THIS DOCUME NT PERTAINS TO THE APPELLANT AND IT REPRESENTS THE AMOUNT OF CASH RECE IVED BY THE APPELLANT FROM SHRI DINESH JAIN ON THE SALE OF PROPERTY. THE REASONS AGAINST DRAWING SUCH A PRESUMPTION AS ENUMERATED BY THE APP ELLANT ARE IT(SS)A NO.127/D/2007 15 I) IT IS A PLAIN PAPER; II) IT IS UNSIGNED; III) NOWHERE THE NAME OF THE APPELLANT APPEARS ON THIS DOCUMENT; IV) THIS DOCUMENT HAS NOT BEEN FOUND AT THE PREMISES OF THE APPELLANT V) NO PERSON, BUYER, SELLER, BUILDER, HAS MADE ANY ALLEGATION OR MADE A STATEMENT REGARDING RECEIPT OF MONEY OR PAYMENT OF ON MONEY. VI) NOTHING INCRIMINATING WAS FOUND FROM THE PREMISES OF SHRI D.N. TANEJA EVEN TO IMPUTE THAT THIS DOCUMENT PERTAINS TO THE APPELLANT VII) NOWHERE IN THE DOCUMENT THERE IS ANY REFERENCE TO THE APPELLANT VIII) THERE IS NO CORROBORATION WHATSOEVER FROM ANY MATERIAL, STATEMENTS AND ENQUIRY CARRIED OUT BY THE REVENUE. 4.13 THE CIT(A) IN THE EARLIER ORDER DT. 27.8.20 04, THOUGH AGREEING TO THE ABOVE FACTS, BUT DID NOT GIVE RELIEF AS HE NOTI CED CERTAIN PECULIARITIES. IT WAS NOTICED BY THE CIT (A) THAT THE COMMERCIAL FLAT S AT GROUND AND THIRD FLOORS SOLD TO SHRI DINESH JAIN GROUP WERE SOLD AT A PRICE LOWER THAN THE PRICE OF OTHER COMMERCIAL FLATS SOLD ON THE SAME FL OOR OR OTHER FLOORS BY ELITE PROMOTERS (P) LTD WITH WHOM THE APPELLANT HAD COLLABORATION AGREEMENT. FOR THIS HE REFERRED TO SALE MADE TO THE FOLLOWING COMPANIES, NAMELY, MIS. SHRI JAGANNATH SECURITIES (P) LTD., AN D M/S. ANTRIKSH LAND PROMOTERS (P) LTD., @ RS.1,400 PER SQ. FT. AND M/S. CHANDRA ADVERTISING (P) LTD., @ RS.1,250 SQ. FT. AND M/S. LALL CONSTRUC TION (P) LTD., @ RS.1,150 PER SQ. FT. AS AGAINST THE SALE PRICE OF R S.1,000 AND RS.900 CHARGED BY THE APPELLANT COMPANY FROM SHRI DINESH J AIN GROUP. ON THE BASIS OF THIS THE CIT(A) HELD THAT THE PRICES WERE UNDERSTATED BY THE APPELLANT AND DREW A PRESUMPTION THAT CASH WOULD HA VE BEEN RECEIVED OVER AND ABOVE THE AMOUNT STATED IN THE BOOKS OF AC COUNT. THE CIT(A) FURTHER MADE AN OBSERVATION THAT THE STATEMENT GIVE N BY SHRI D.N. TANEJA THAT HE DOES NOT KNOW ANY PERSON NAMED VIPIN SHARMA WHO HAS SIGNED ALMOST ALL AGREEMENTS TO SELL AND THE SALE DEEDS EX ECUTED IN FAVOUR OF SHRI DINESH JAIN GROUP WAS WRONG. FURTHER THE CIT(A ) BY REFERRING TO THE AGREEMENT TO SELL EXECUTED BY THE APPELLANT WITH SH RI DINESH JAIN ALSO OBSERVED THAT THERE IS A REFERENCE TO THE COMPLE TION CERTIFICATE OF THE BUILDING WHICH HAS BEEN ISSUED AFTER THE DATE OF TH E AGREEMENT. THE ITAT HOWEVER NOTED THAT THOUGH THE CIT(A) HAS OBSERVED T HESE FACTS BUT THE APPELLANT HAS NEVER BEEN GIVEN THESE DETAILS NOR WA S ASKED TO EXPLAIN THE SAME. THE TRIBUNAL FURTHER OBSERVED THAT IN THIS CA SE SURPRISINGLY THE AO HAS CONCLUDED THAT THE APPELLANT HAS SOLD PALM COUR T FLAT TO SHRI DINESH JAIN AT A TOTAL CONSIDERATION OF RS.7,74,29,500 OUT OF WHICH ONLY IT(SS)A NO.127/D/2007 16 RS.2,40,00,300 WAS ACCOUNTED FOR IN THE BOOKS AND T HE BALANCE OF RS.5,34,29,200 WAS RECEIVED IN CASH WHICH WAS NOT E NTERED IN THE BOOKS OF ACCOUNT DESPITE THE FACT THAT EACH OF THE PARTIE S INCLUDING MR. DINESH JAIN TO WHOM PROPERTY WAS SOLD HAVE DENIED THE SAME . THE TRIBUNAL FURTHER OBSERVED THAT IT IS ALSO NOT ON RECORD AS T O WHAT HAS HAPPENED IN THE CASE OF SHRI DINESH JAIN IN RESPECT OF HIS GROU P CASES FOR ASSESSMENT OF THE ALLEGED PAYMENT IN CASH BY THEM. THE TRIBUNA L FURTHER OBSERVED THAT SHRI RAVINDER TANEJA WAS NOT PUT TO QUESTION A BOUT THE DOCUMENT CONTAINING DETAILS OF THE CASH AND CHEQUE PAYMENTS AND OTHER NOTING STATED TO HAVE BEEN TAKEN BY SHRI D.N. TANEJA, THE DOCUMENT ON WHICH THE CASE OF THE DEPARTMENT HEAVILY STANDS. FURTHER AS DISCUSSED ABOVE, THE APPELLANT HAS CONTE NDED THAT THE AO HAS DONE NOTHING AND HAS FAILED TO CARRY OUT THE DIRECTION OF THE ITAT WHICH WERE VERY SPECIFIC. NOW THE ISSUE TO BE DECID ED IS WHETHER THE AO HAS BEEN ABLE TO BRING SUFFICIENT MATERIAL TO SUBST ANTIATE THE ALLEGATION AND CORROBORATE THE ALLEGED DOCUMENT. AS PER THE DIRECT ION OF THE ITAT, THE AO WAS SUPPOSED TO PUT SHRI D.N. TANEJA AND SHRI RA VINDER TANEJA TO QUESTION ABOUT THIS DOCUMENT AND ALSO TO RECORD THE STATEMENT OF SHRI DINESH JAIN TO FIND OUT WHETHER ADDITIONS HAVE BEEN MADE IN HIS HAND OF THE CASH ALLEGED TO HAVE BEEN PAID BY HIM TO THE AP PELLANT. AS IS EVIDENT FROM THE ASSESSMENT ORDER, THE AO DID NOT RECORD TH E STATEMENT OF ANY OF THESE PERSONS DURING THE ASSESSMENT PROCEEDINGS .N O EFFORTS WERE MADE BY THE AO TO CORROBORATE THE ASSUMPTION BEING MADE AGAINST THE APPELLANT. IT WAS ONLY WHEN THE APPELLANT IN ITS WR ITTEN SUBMISSION BEFORE ME POINTED OUT THE SPECIFIC ISSUES POINTED OUT BY I TAT AND A COPY OF THE SAME WAS FORWARDED TO THE ASSESSING OFFICER THEN ON LY HE RECORDED THE STATEMENT OF THESE PERSONS DURING THE REMAND PROCEE DINGS. THUS, THE PRESENT ASSESSMENT ORDER PASSED BY THE AO WHEREBY HE HAS AGAIN MADE THE ADDITION AT LEAST ON THE DATE WHEN IT WAS PASSE D WAS WITHOUT ANY BASIS AND THE PRESUMPTION DRAWN AGAINST THE APPELLA NT WAS WITHOUT ANY CORROBORATION. NOW COMING TO THE REMAND PROCEEDINGS , IT NEEDS TO BE EXAMINED WHETHER ANYTHING ADVERSE HAS COME OUT IN T HE STATEMENTS RECORDED BY THE AO OF THE RELEVANT PERSONS. ON GOIN G THROUGH THE STATEMENT GIVEN BY SHRI DINESH JAIN RECORDED BY THE AO ON 6.12.2006 IT IS NOTICED THAT HE HAS DENIED HAVING GIVEN ANY CASH TO THE APPELLANT. HE HAS ALSO DENIED THE CONTENTS OF THE PAGE ON THE BASIS O F WHICH ADDITION HAS BEEN MADE BY THE AO. SHRI DINESH JAIN HAS CATEGORIC ALLY STATED THAT THE TRANSACTION RELATING TO THE PURCHASE OF PALM COURT FLATS FROM THE APPELLANT ALL PAYMENTS HAVE BEEN MADE THROUGH CHEQUES AND DD, WHICH HAVE BEEN DULY REFLECTED IN THE BOOKS OF ACCOUNT OF THE APPEL LANT. SIMILARLY FROM THE STATEMENT OF SHRI D.N. TANEJA, W HICH WAS RECORDED BY THE AO ON 22.1.2007, IT HAS BEEN CONFIR MED THAT THESE PAPERS DO NOT BELONG TO M/S. ELITE PROMOTERS (P) LT D AND THESE PAPERS ARE NOT FROM THE COMPUTER SEIZED AT THE TIME OF THE SEARCH AT THEIR OFFICES AS WELL AS RESIDENCES. IN RESPONSE TO QUEST ION 3, SHRI D.N. TANEJA HAS CATEGORICALLY STATED: IT(SS)A NO.127/D/2007 17 'THESE PAPERS WERE LYING IN THE OFFICE OF SHRI RATAN CHAND TANEJA WHO HAD UNDERGONE BYPASS SURGERY OPERATION AND I HAD ENQUIRED FROM RATTAN CHAND TANE JA AS WELL AS RAVINDER TANEJA. BOTH HAVE STATED THAT THES E PAPERS DO NOT BELONG TO M/S. ELITE PROMOTERS (P) LT D., AND THESE PAPERS ARE NOT FROM THE COMPUTER SEIZED AT TH E TIME OF THE SEARCH AT OUR OFFICES AS WELL AS RESIDENCES. THIS MIGHT BE THE HANDIWORK OF SOME MISCHIEVOUS PERSON W HO MIGHT HAVE THROWN THESE PAPERS TO MALIGN OUR REPUTA TION'. FROM THE REMAND REPORT, I NOTICE THAT THE STATEMENT OF SHRI RAVINDER TANEJA WAS ALSO RECORDED BY THE AO ON THE SAME DAY AND HE HAS ALSO DENIED THAT THESE PAPERS BELONG TO THE COMPANY. IN RESPONSE TO QUESTION 1 HE HAS STATED: 'I DO NOT KNOW THE CONTENTS OF THESE PAPERS AS THEY DO NOT BELONG TO MY COMPANY, I.E., M/S. ELITE PROMOTERS (P) LTD., NEITHER WERE THEY FOUND FROM THE PREMISES OF THE COMPANY'. FURTHER, I NOTICE FROM THE STATEMENT THAT IN RESPON SE TO QUESTION NO.5, SHRI RAVINDER TANEJA HAS STATED: 'THIS IS UNSIGNED PAPER. NEITHER IT WAS FROM OUR CO MPUTER SEIZED FROM OUR OFFICES AS WELL AS OUR RESIDENCES. THESE PAPERS DO NOT BELONG TO US. THIS MIGHT BE THE HANDI WORK OF SOME MISCHIEVOUS BRAIN WHO HAS THROWN THIS PAPER AT 7- K.G. MARG TO MALIGN OUR REPUTATION. WE FURTHER REIT ERATE THAT WE HAVE NOT RECEIVED ANY CASH PAYMENT FROM SHR I DINESH JAIN AND FAMILY. THIS CAN BE CONFIRMED FROM SHRI DINESH JAIN. IN CASE IF THERE IS ANY OTHER EVIDEN CE PLEASE CONFIRMS THE SAME TO US'. THE ABOVE STATEMENTS RECORDED BY THE AO EVEN IN REM AND PROCEEDINGS WHEN ALL ISSUES RAISED BY THE APPELLANT AND SPECIFI C POINTS AND IN CONSISTENCIES WERE BEFORE THE A.O, THE A.O COULD NO T BRING ANY MATERIAL AND GATHER ANY FACTS FROM THESE PERSONS TO SUPPORT THE ASSUMPTION FOR SUSTAINING THE ADDITION. THESE STATEMENTS NOWHERE G O TO PROVE THE ALLEGATION THAT THE ALLEGED DOCUMENT PERTAINS TO TH E APPELLANT AND THE APPELLANT HAS RECEIVED CASH OVER AND ABOVE WHAT HAS BEEN ACCOUNTED FOR IN THE BOOKS OF ACCOUNT. THESE PERSONS HAVE GONE ON RECORD CONFIRMING THAT THERE WAS NO CASH PAYMENT AND THE ALLEGED PAPE R CAN BE HANDIWORK OF SOME MISCHIEVOUS PERSON. FURTHER PRINTOUT IS NO T COMING OUT FROM THEIR COMPUTERS TO SUPPORT THEIR CONTENTION THAT THIS PAP ER DOES NOT BELONG TO IT(SS)A NO.127/D/2007 18 THEM. A.O HAS NOT BEEN ABLE TO MEET ANY OF THESE IS SUES. AS REGARDS THE COMPARATIVE SALE INSTANCES REFERRED TO IN THE EARLIER ORDER OF THE CIT(A) FOR DRAWING AN ADVERSE INFERENCE AGAI NST THE APPELLANT, I FIND THAT THESE SALE INSTANCES ARE IN RESPECT OF FOUR CO MPANIES ONLY, NAMELY, M/S. SHRI JAQANNATH SECURITIES (P) LTD., M/S. ANTRI KSH LAND PROMOTERS (P)LTD., M/S. CHANDRA ADVERTISING (P) LTD., AND M/S . LALL CONSTRUCTION (P) LTD., NOW THE ISSUE WHETHER THESE SALE INSTANCES ARE COMPARABLE AND GENUINE TO BE USED AGAINST THE APPELLANT FOR DRAWIN G AN ADVERSE INFERENCE IN THE LIGHT OF THE FACT THAT THE APPELLA NT AS WELL AS ITS COLLABORATE M/S ELITE PROMOTERS (P) LTD. HAVE SOLD A LARGE NUMBER OF OTHER FLATS AT A RATE WHICH ARE COMPARABLE WITH THE RATE AT WHICH SALE AS BEEN RECORDED IN THE BOOKS OF ACCOUNTS TO MR. DI NESH JAIN AND HIS FAMILY MEMBERS AND SALE OF ALL THESE FLATS HAVE BEE N ACCEPTED BY THE DEPARTMENT IN THE REGULAR ASSESSMENT PROCEEDING. TH E APPELLANT'S REPRESENTATIVES HAS DRAWN MY ATTENTION TO THE ASSES SMENT ORDER PASSED IN THE CASE OF M/S ELITE PROMOTERS (P) LTD., WHERE THERE IS AN ELABORATE DISCUSSION ABOUT THE MONEY RECEIVED FROM THESE FOUR COMPANIES IN THE GARB OF ADVANCE AGAINST SALE AS AC COMMODATION ENTRIES. I NOTICE THAT THE AO HIMSELF HAS HELD THES E SALES TO BE BOGUS ACCOMMODATION ENTRIES AS IS EVIDENT FROM THE ORIGIN AL ASSESSMENT ORDER PASSED IN THE CASE OF M/S. ELITE PROMOTERS (P ) LTD., WHERE IN PARA 8.11 ON PAGE 46 & 47 THE ISSUE HAS BEEN DISCUSSED IN DETAIL. A REFERENCE HAS BEEN MADE TO THE STATEMENT OF SHRI A. S. VERMA IN THE SAID ORDER WHERE MR. A.S. VERMA HAS ADMITTED THAT H E HAS USED THE ACCOUNTS OF THESE COMPANIES THROUGH THE OPERATOR AN D INTRODUCER FOR THE PURPOSE OF DEPOSITING CASH AND CONSEQUENTLY GIV ING CHEQUE ENTRIES. THE DETAILS OF THESE ACCOUNTS ALONGWITH IN TRODUCER AND THE OPERATOR HAVE BEEN CLEARLY STATED AND ADMITTED BY S HRI AS. VERMA. THE ENTRIES STATED IN THIS ORDER AGAINST THE NAME O F THE COMPANIES ARE EXACTLY THE SAME WHICH ARE SHOWN IN THE CASE OF M/S . ELITE PROMOTERS (P) LTD., AS ADVANCE FOR SALE OF PROPERTY. IT IS A FACT THAT THE SALES HAVE NOT BEEN MADE TO ANY OF THESE PARTIES. THESE ARE TH E SAME INSTANCES REFERRED TO BY THE CIT(A) AND ON WHICH RELIANCE HAS BEEN PLACED BY THE AO FOR MAKING COMPARISON AND HOLDING THAT THE SALE PRICE CHARGED BY THE APPELLANT E IS MUCH LOWER THAN CHARGED BY OTHER S. IN VIEW OF THESE FACTS AS EMERGING FROM RECORDS I AM IN AGREEMENT WI TH THE APPELLANT THAT THESE SALE INSTANCES ARE NOT GENUINE AND CANNO T BE CONSIDERED AGAINST THE APPELLANT. SURPRISINGLY THE AO HIMSELF IS DOUBTING THESE SALES TRANSACTIONS IN ONE ASSESSMENT ORDER AND AT T HE SAME TIME UTILIZING IT AGAINST THE PRESENT APPELLANT. IT IS S EEN THAT AS PER THE SALES INSTANCE OF DIFFERENT FLOORS OF THE SAME PROPERTY T O THE PERSONS OTHER THAN DINESH JAIN AND FAMILY MEMBERS WHICH IS PROVIDED BY THE ASSESSING OFFICER HIMSELF ALONG WITH HIS REMAND REP ORT, IT IS NOTICED THAT 11 FLATS WERE SOLD ON FIRST FLOOR TO OTHER PAR TIES AT THE RATES OF RS. 950 TO 1100 PER SQ. FEET DURING THE PERIOD OF 3 0.9.2000 TO 20.2.2001. IT(SS)A NO.127/D/2007 19 SIMILARLY 6 FLATS AT SECOND FLOOR WERE SOLD AT THE RATE OF RS. 948 PER SQ. FEET ON 7.12.2000. IT IS FURTHER SEEN THAT 13 FLATS ON FOURTH FLOOR WERE SOLD @ OF RS.900 PER SQ. FEET DURING THE PERIOD OF 31.7. 2000 TO 31.1.2001. THERE IS FURTHER SALE OF 2 FLATS ON 5 TH FLOOR @ 1100 PER SQ. FEET ON 14.6.2001. SALE OF 11 FLATS AT 6 FLOOR IS ALSO NOTI CED @ 900 PER SQ. FEET THAT IS RANGING DURING THE PERIOD OF 15.11.2000 TO 15.6. 2001. LASTLY ON 7 TH FLOOR THERE IS SALE OF 7 FLATS @ 1100 PER SQ. FEET ON 29.3.2001. AS AGAINST SUCH SALE INSTANCE TO THE OTHER INDEPEND ENT PARTIES OTHER THAN DINESH JAIN AND FAMILY GROUP, THE APPELLANT HAS SHO WN SALE OF 7 GROUND FLOOR FLATS @ 1000 PER SQ. FEET DURING THE PERIOD O F 20.10.2000 TO 7.11.2000 AND THERE IS ANOTHER SALE OF 6 FLATS TO T HE SAME GROUP @ RS. 900 PER SQ. FEET DURING THE PERIOD OF 20.10.2000 TO 7.11.2000. IT CAN BE SEEN THAT WHATEVER SALE CONSIDERATION HAS BEEN SHOW N AS RECEIVED/RECEIVABLE FROM THE PERSONS OTHER THAN THE DINESH JAIN AND FAMILY MEMBERS HAS BEEN ACCEPTED BY THE ASSESSING O FFICER IN THE REGULAR ASSESSMENT ORDER AS WELL AS NO ADVERSE INFERENCE HA S BEEN TAKEN IN THE PRESENT BLOCK ASSESSMENT ORDER. IT CAN FURTHER BE N OTICED THAT ON 4TH FLOOR SALE OF 12 FLATS HAS BEEN SHOWN AND ACCEPTED AS MAD E TO OTHER INDEPENDENT PARTIES @ RS.900 PER SQ. FEET AS AGAINS T WHICH THE SALE MADE WHICH IS ACCOUNTED FOR AS RECEIVED FROM DINESH JAIN AND FAMILY MEMBERS IN RESPECT OF FLATS OF 3 RD FLOOR IS ALSO @ RS. 900 PER SQ. FEET. IT IS FURTHER SEEN THAT THERE ARE 3 INSTANCE OF SALE OF F LATS AT FIRST FLOOR @ 950 PER SQ. FEET TO THE OTHER INDEPENDENT PARTIES AS AG AINST WHICH THE PRICE SHOWN AND ACCOUNTED FOR IN RESPECT OF SALE OF FLATS AT GROUND FLOOR TO DINESH JAIN AND FAMILY MEMBERS IS @ 1000 PER SQ. FE ET. THIS TOTAL DISCUSSION AND ANALYSIS OF COMPARATIVE SALE INSTANC E SHOWS PRIMA FACIE AND IN CLEAR MANNER THAT IT IS NOT THE CASE THAT TH E APPELLANT HAS SOLD VARIOUS FLATS ON FIRST AND THIRD 'FLOOR OF THE PALM COURT PROJECT TO DINESH JAIN AND FAMILY MEMBERS AT BELOW THE NORMAL SALE RA TE WHICH IS ADOPTED IN THE CASES OF OTHER INDEPENDENT PARITIES WHICH HA S BEEN ACCEPTED BY THE ASSESSING OFFICER ALSO. WITHOUT AFFIRMING BUT PRESU MING THAT THE APPELLANT HAS RECEIVED CASH COMPONENT FROM DINESH JAIN AND FA MILY MEMBERS FOR WHICH THE ADDITIONS HAVE BEEN MADE AS UNDISCLOSED I NCOME THAN IN PROPORTIONATE MANNER ACTUAL SALE CONSIDERATION TO T HESE PARTIES WILL BE 179% HIGHER WHATEVER HAS BEEN SHOWN AND ACCOUNTED F OR IN THE BOOKS OF ACCOUNTS. IN SIMPLE WORDS IT MEANS THAT WHEREVER FO R THE GROUND FLOOR RATES HAVE BEEN SHOWN @ 1000 PER SQ. FEET IT SHOULD BE RS.2790/- PER SQ. FEET WHICH IS CERTAINLY NOT A COMPARABLE CASE BY AN Y STANDARD. SIMILARLY FOR THE 3 RD FLOOR WHERE IT HAS BEEN SHOWN @ RS.900 PER SQ. FEE T IT SHOULD HAVE BEEN AT RS.2511/- PER SQ. FEET WHICH IS ALSO N OT ANY COMPARABLE INSTANCE IN RESPECT OF INDEPENDENT PARTIES. THE HON 'BLE I.T.A.T. WHILE SETTING ASIDE THE ISSUE OF SAID ADDITION HAS OBSERV ED IN DETAIL BY REFERRING THE FINDINGS AND OBSERVATIONS OF CIT(A) III DELHI O RDER THAT COMPARABILITY HAS TO BE SEEN AND IT HAS TO BE CONFRONTED TO THE A PPELLANT. PRIMA FACIE THIS SHOWS THAT IN ABSENCE OF CLEAR EVIDENCE THAT T HE APPELLANT HAS RECEIVED CASH COMPONENT AS APPEARING IN THE COMPUTE RIZED PRINT IT(SS)A NO.127/D/2007 20 OUT WHICH IS THE BASIS OF ENTIRE ADDITION HAS NOT B EEN CORROBORATED BY ANY OTHER DIRECT OR INDIRECT EVIDENCE. AS FAR AS LEGAL PRESUMPTION U/S 132(4A) IS CONCERNED IN RESPECT OF SAID COMPUTERIZED PRINT OUT THE RECENT DECISION GIVEN BY THE HON'BLE SUPREME COURT IN THE CASE OF P .R. METRANI VS. CIT ON 15.11.2006 (287 ITR 209) IS QUITE RELEVANT IN WH ICH THE HON'BLE SUPREME COURT HAS OBSERVED THAT RAISING OF SUCH A P RESUMPTION HAS BEEN ENACTED BY THE LEGISLATURE TO ENABLE THE ASSESSING AUTHORITY TO MAKE A PROVISIONAL ADJUDICATION WITHIN THE TIME FRAME PRES CRIBED U/S 132. THE HON'BLE SUPREME COURT HAS FURTHER OBSERVED THAT THE RE IS NOTHING EITHER IN SEC. 132 OR IN ANY OTHER PROVISIONS OF TH E ACT TO INDICATE THAT THE PRESUMPTION PROVIDED U/S 132, WHICH IS A SELF CONTAINED CODE FOR SEARCH & SEIZURE AND RETENTION OF BOOKS ETC. CAN BE RAISED F OR THE PURPOSE OF FRAMING OF THE REGULAR ASSESSMENT AS WELL AND IT HA S ALSO OBSERVED THAT WHEREVER THE LEGISLATURE INTENDED A PRESUMPTION TO CONTINUE, IT HAS BEEN PROVIDED SO. FINALLY THE HON'BLE SUPREME COURT HAS STATED THAT THE SAID PRESUMPTION U/S 4A OF THE 132 IS, A REBUTTABLE PRESUMPTION. THE DEN IAL OF MAKING AFORESAID CASH PAYMENT WHICH IS REFLECTED IN THE SAID COMPUTER PRINT OUT BY SH. DINESH JAIN, DENIAL OF SUCH PAYMEN T BY SH. D.N. TANEJA AND RAVINDER TANEJA AND NOT A SINGLE EVIDENCE CORRO BORATING THE AFORESAID CASH PAYMENT WHICH HAS NOT BEEN ACCOUNTED FOR AS PER SAID COMPUTER PRINT OUT SHOWS THAT SUCCESSFULLY AND IN C LEAR TERMS THE APPELLANT HAS REBUTTED THE SAID PRESUMPTION OF SEC. 132(4A). MORE OR LESS ON THE SIMILAR ISSUE RECENTLY THERE WAS ANOTHE R JUDGMENT GIVEN BY THE THREE MEMBER BENCH OF I.T.A.T. MUMBAI BENCH IN THE CASE OF MISS AISHWERYA K.RAI VS. OCIT CC-2 MUMBAI (104 ITO 166) 2007 WHEREIN THE FATHER OF AISHWERYA RAI IN THE FIRST STATEMENT RECORDED DURING THE COURSE OF SEARCH HAS ADMITTED THAT THE CASH PAYMENT OF RS.50 LAKHS OVER & ABOVE ACCOUNTED FOR CONSIDERATION HAS BEEN MADE AND IN SUPPORT OF SUCH CASH PAYMENT IT WAS CLAIMED BY THE ASSESSING OFFICER THAT THE ENQUIRES WERE MADE FROM BUILDER ALSO HOWEV ER, ON THE BASIS OF SUBSEQUENT DENIAL BY THE FATHER OF AISHWARYA RAI AND ON THE GROUND OF NOT MAKING AVAILABLE THE RESULT OF ENQUIRY FROM THE BUILDER THE HON'BLE I.T.A.T. HAS DELETED THE SAID ADDITION ON A CCOUNT OF 50 LAKHS CASH PAYMENT OVER AND ABOVE PURCHASE CONSIDERATION SHOWN. CONTRARY TO THE FACTS OF AFORESAID CASE OF AISHWARY A RAI IN THE PRESENT CASE THERE IS NOT A SINGLE STATEMENT CONFIRMING THE CASH PAYMENT/RECEIPT AND THERE IS NOT A SINGLE PIECE OF THE ENQUIRY FROM ANY OF THE PARTY-INCLUDING OF BROKER. IT SHOWS THAT THE ADDITIONS UNDER CONSIDERATION ON ACCOUNT OF UNACCOUNTED CASH PAYMEN T WAS NOT BASED ON ANY CORROBORATIVE EVIDENCE AND ENQUIRIES A T ALL. IN MY OPINION THESE LARGE NUMBER OF SALES INSTANCES MADE TO OTHER PARTIES SUPPORT THE CASE OF THE APPELLANT THAT THE VALUE RE CORDED FOR SALES OF FLATS TO MR. DINESH JAIN AND FAMILY MEMBERS IS CORR ECT AND PRESUMPTION DRAWN AGAINST THE APPELLANT THAT HE HAS RECEIVED 'ON MONEY' OVER AND ABOVE ACCOUNTED FOR CONSIDERATION C AN NOT BE SUSTAINED IN VIEW OF THESE SALES INSTANCES. IT IS I MPORTANT TO NOTE THAT IT(SS)A NO.127/D/2007 21 THESE SALES INSTANCES ARE IMPORTANT PIECES OF EVIDE NCE AND MORE SO WHEN THE SAME HAVE BEEN ACCEPTED. AS SUCH, WHILE MA KING A COMPARISON THESE SALES INSTANCES CANNOT BE IGNORED. ON THE CONTRARY, THE SALES INSTANCES REFERRED TO BY THE CIT(A) IN HI S EARLIER APPELLATE ORDER AND RELIED UPON BY THE AO ARE NOT ACTUAL AND THESE WERE SHOWN IN THE MOU WHICH WAS NEVER ACTED UPON AS FAR AS ACT UAL SALE OF THE FLATS IS CONCERNED TO THE SAID CONCERNS AND IN FACT NO ACTUAL SALE TO THE SAID FOUR PARTIES OF ANY FLAT ON ANY FLOOR HAS EVER TAKEN PLACE AND AS SUCH RATES SHOWN IN AFORESAID MOUS CANNOT BE GIVEN THE WEIGHTAGE OVER AND ABOVE AFORESAID ACTUAL SALES INSTANCES. I N THE CIRCUMSTANCES, I FIND THAT THE SALE INSTANCES IN THE APPELLANT'S O WN CASE, WHICH HAVE BEEN ACCEPTED BY THE AO, NEARLY MATCH WITH THE SALE PRIC E RECORDED IN THE CASES OF THE SALE MADE TO SHRI DINESH JAIN AND HIS GROUP IN THE BOOKS OF ACCOUNT AND THE PRESUMPTION, IF ANY, WHICH HAS TO B E DRAWN, SHALL BE IN FAVOUR OF THE APPELLANT IN ABSENCE OF ANY EVIDENCES CONTRARY THERETO. AS SUCH, NO ADVERSE INFERENCE CAN BE DRAWN AGAINST THE APPELLANT IN RESPECT OF THE SALE INSTANCES WHICH, AS EXPLAINED ABOVE, AR E NOT CORRECT. AS REGARDS THE OTHER OBSERVATION OF THE CIT(A), REG ARDING THE COMPLETION CERTIFICATE AND DATE OF AGREEMENT I FIND THAT THE S AME HAS BEEN CLARIFIED BY SHRI RAVINDER TANEJA IN HIS STATEMENT. SHRI RAVI NDER TANEJA CLARIFIED THE ALLEGED DISCREPANCY IN THE DATE OF THE AGREEMEN T AS UNDER: . 'IT APPEARS THAT REGARDING THE DATE OF AGREEMENT TO SELL DATED 10/4/00 AND 1/4/00 AND CONTENT OF THE AGREEMENT ARE BEING MISUNDERSTOOD OR MISREAD. REGARDING THE DEPOSIT OF CHEQUES, THAT ALL THE CHEQ UES WERE NOT DEPOSITED LATE.THE CHEQUES WERE DEPOSITED LATE BECAUSE MR. DINESH JAIN WAS A RESIDENT OF KANPUR AND HE HAD PROMISED TO ARRANGE DD AGAINST CHEQUES. WHEN THE DDS WERE NOT ARRANGED, THE CHEQUES WERE DEPOSITED. AGREEMENTS WERE DULY EXECUTED IN THE MONTH OF APRIL, 2000'. THE AO HAS NOT BEEN ABLE TO POINT OUT ANYTHING FURT HER ON THIS ISSUE. SIMILARLY, SHRI RAVINDER TANEJA AND SHRI D.N. TANEJ A BOTH HAVE CATEGORICALLY DENIED HAVING KNOWN SHRI VIPIN SHARMA IN THE STATEMENT AND THE AO COULD NOT EXTRACT ANY FURTHER MATERIAL SO AS TO DRAW ANY ADVERSE INFERENCE AGAINST THE APPELLANT. MOREOVER, KNOWING OR NOT KNOWING VIPIN SHARMA DOES NOT PROVE THE DEPARTMENTAL CASE OF RECE IVING UNACCOUNTED CASH MONEY WHEN THERE IS NO STATEMENT EVEN FROM SAI D SH VIPIN SHARMA REGARDING CASH PAYMENT INVOLVED IN THE DEALS WHICH IS SUBJECT MATTER OF CONTENTION. FURTHER IN MY VIEW THESE TYPES OF ERROR S IN THE AGREEMENT TO SELL CAN NOT LEAD TO THE CONCLUSION THAT THE APPELL ANT HAS RECEIVED CASH OVER AND ABOVE WHAT IS STATED. THERE IS NO OTHER AG REEMENT WHICH IT(SS)A NO.127/D/2007 22 WITNESSES OR EVIDENCES OF SALE CONSIDERATION BEING DIFFERENT THAN WHAT IS STATED IN THESE AGREEMENTS OR IN THE BOOKS OF ACCOU NTS. THE PAYMENT OF HAVING RECEIVED CASH MONEY OVER AND ABOVE WHAT IS S TATED IN THE AGREEMENT TO SELL OR RECORDED IN THE BOOKS OF ACCOU NTS IS A SERIOUS ALLEGATION. THE SAME HAS TO BE PROVED BY BRINGING P OSITIVE AND COGENT MATERIAL NOT BY POINTING OUT CERTAIN ERRORS OR OMIS SIONS IN THOSE VERY AGREEMENTS WHICH HAS NOTHING TO DO WITH THE AMOUNT OF SALE. EVEN OTHERWISE THESE ERRORS ARE NOT WITH REFERENCE TO SA LE CONSIDERATION . I NOTICE FROM THE VARIOUS SUBMISSION OF THE APPELLA NT AS WELL AS THE DOCUMENTS BROUGHT ON RECORD THAT HERE IS A CASE WHE RE EXCEPT FOR A PIECE OF PAPER ON THE BASIS OF WHICH THE ALLEGATION IS BE ING MADE, THERE IS NO MATERIAL WHATSOEVER TO CORROBORATE THE ALLEGATION T HAT THE APPELLANT HAS RECEIVED OVER AND ABOVE THE PAYMENT ACCOUNTED FOR I N THE BOOKS OF ACCOUNT. SHRI DINESH JAIN TO WHOM THE PROPERTY HAS BEEN SOLD BY THE APPELLANT HAS APPEARED TWICE BEFORE THE AO, ONCE DU RING THE ORIGINAL ASSESSMENT PROCEEDINGS AND THE SECOND TIME IN THE R EMAND PROCEEDINGS IN THIS APPEAL. ON BOTH OCCASIONS HE HAS CATEGORICA LLY DENIED HAVING PAID ANY CASH TO THE APPELLANT. NO ADDITION HAS BEEN MAD E IN THE HANDS OF SHRI DINESH JAIN TO WHOM THE APPELLANT HAS SOLD THE PROP ERTY. THERE WAS. A SPECIFIC OBSERVATION BY THE IT AT IN ITS ORDER TO T HE FACT THAT IT IS NOT ON RECORD AS TO WHAT HAS HAPPENED IN THE CASE OF SHRI JAIN AND HIS GROUP CASES IN RESPECT OF THE ALLEGED PAYMENT OF CASH BY THEM. IT IS SURPRISING THAT THE ASSESSING OFFICER, HAVING ACCEPTED THE PUR CHASE PRICE PAID BY SHRI DINESH JAIN, IS DISPUTING THE SALE CONSIDERATI ON OF THE SAME TRANSACTION IN THE HANDS OF THE APPELLANT THIS DOCU MENT WAS NOT FOUND AT THE PREMISES OF THE APPELLANT. THE PERSONS FROM WHO SE POSSESSION THIS DOCUMENT WAS FOUND HAVE ALSO DENIED THE OWNERSHIP O F THE DOCUMENT AND HAVE CATEGORICALLY STATED BEFORE THE AO THAT THIS I S A MISCHIEVOUS ACT. I NOTICE THAT SHRI D.N. TANEJA AND SHRI RAVINDER TANE JA BOTH HAVE CATEGORICALLY TAKEN A STAND THAT THE PRINT OUT IS A LSO NOT FROM THEIR COMPUTER NOR THE CONTENT OF THIS DOCUMENT WAS FOUND IN THEIR COMPUTER. THE AO COULD NOT EXTRACT ANYTHING FROM ANY PERSON W HOM HE SUMMONED DURING HIS INVESTIGATIONS AND IN THE STATEMENTS REC ORDED BY HIM. NO PERSON, BUYER, SELLER OR COLLABORATOR HAS MADE ANY ALLEGATION OF THE 'ON MONEY' PAYMENT. NOTHING INCRIMINATING HAS BEEN FOUN D TO CORROBORATE THE PAPER DURING THE SEARCH AND THE POST-SEARCH ENQUIRI ES. UNDER SUCH CIRCUMSTANCES, IT CANNOT BE HELD THAT THE APPELLANT HAS RECEIVED CASH PAYMENT OVER AND ABOVE WHAT HAS BEEN STATED IN THE BOOKS OF ACCOUNT. WITH THIS ANALYTICAL DISCUSSION AND KEEPING IN VIEW THE AVAILABLE EVIDENCE AND RELEVANT JUDICIAL DECISIONS THERE REMAINS NO BA SIS TO SUSTAIN THE ADDITION AS UNDISCLOSED INCOME OF RS.4,30,00,000/- IN THE FORM OF UNACCOUNTED CASH PAYMENT, WHICH IS HEREBY DELETED. 4.14 AS FAR AS FURTHER ADDITION OF RS. 97,11,030/ - IS CONCERNED, KEEPING IN VIEW THE FINDING GIVEN IN RESPECT OF ADDITION OF RS .4,30,00,000/- WHICH STANDS ALREADY DELETED ABSOLUTELY THERE REMAINS NO BASIS TO SUSTAIN THE IT(SS)A NO.127/D/2007 23 SAID ADDITION OF RS. 97,11,030/- ALSO SINCE NO INDE PENDENT EVIDENCE COULD BE COLLECTED BY THE ASSESSING OFFICER THAT TO THE A FORESAID EXTENT INTEREST/RENT WAS RECEIVABLE/RECEIVED FROM DINESH J AIN & GROUP WHICH WAS NOT SHOWN IN BOOKS OF ACCOUNTS OF THE APPELLANT. WI THOUT PREJUDICE THIS FINDING IN ANY CASE ON THE SAID COMPUTERIZED PRINT IN RESPECT OF AFORESAID AMOUNT OF RS.97,11,030/- THE WORDS 'TO BE RECEIVED FROM YOU' WERE WRITTEN AND SINCE TILL THE DATE OF SEARCH NO SUCH A MOUNT WAS RECEIVED EVEN ACCORDING TO SAID COMPUTERIZED PRINT OUT THEREFORE, OTHERWISE ALSO AS FAR AS BLOCK ASSESSMENT IS CONCERNED THE SAID AMOUNT AS UNDISCLOSED INCOME IS BEYOND THE SCOPE OF BLOCK ASSESSMENT AND WITH THIS REASONING ALSO THE SAID ADDITION IS NOT SUSTAINABLE. INCIDENT ALLY IT MAY BE STATED THAT EARLIER CIT(A) III DELHI IN HIS APPELLATE ORDER DT. 27.8.2004 HAS ALSO DELETED THE SAID ADDITION. WITH THIS DISCUSSION AND WITH THE SAME REASONING THE SAID ADDITION OF RS. 97,11,030/- IS A LSO HEREBY DELETED. 3.1 AS REGARDS ADDITION OF ` 31,25,000 ON ACCOUNT OF LOSS ON FARM HOUSE O N THE BASIS OF PAGE NO 24 OF ANNEXURE, A-1 WHICH AC CORDING TO THE AO BELONGED TO THE ASSESSEE COMPANY, THE LD. CIT(A) CO NCLUDED AS UNDER: 5.3 I HAVE CONSIDERED THE FACTS OF THE CASE AN D ARGUMENT TAKEN BY SH. VED JAIN QUITE CAREFULLY. AFTER GOING THROUGH THE A SSESSMENT ORDER IT IS SEEN THAT THOUGH THE SAID ADDITION WAS SET ASIDE BY THE I.T.A.T. BUT THE ASSESSING OFFICER HAS DONE NOTHING TO GATHER MORE E VIDENCE IN SUPPORT OF SAID ADDITION BUT WITH SIMILAR ARGUMENTS AS TAKEN O RIGINALLY IN THE FIRST BLOCK ASSESSMENT HE RETAINED THE SAID ADDITION AGAI N. THIS ISSUE HAS BEEN DISCUSSED IN DETAIL BY THE CIT(A)-III, NEW DELHI IN HIS APPELLATE ORDER DT. 27.8.2004 IN PARA 7. TO 7.6 AND I DO NOT SEE ANY RE ASON UNDER PRESENT FACTS AND CIRCUMSTANCES OF THE CASE TO DEVIATE FORM THE VIEW TAKEN BY CIT (A) III NEW DELHI IN THE AFORESAID APPELLATE ORDER. WITH THE SAME REASONS I HEREBY DELETE THE SAID ADDITION OF RS.31,25,000/-. 4. THE REVENUE IS NOW IN APPEAL BEFORE US AGAINST T HE AFORESAID FINDINGS OF THE LEARNED CIT(A). AT THE OUT SET, BOTH THE PARTI ES AGREED THAT THE AFORESAID ISSUES ARE SQUARELY COVERED BY THE DECISION DATED 1 7 TH APRIL, 2009 OF THE ITAT IN THE CASE OF ELITE PROMOTERS PVT. LTD. IN IT(SS)A NO . 128/DEL./2007. 5. WE HAVE HEARD BOTH THE PARTIES AND GONE THROUGH THE FACTS OF THE CASE AS ALSO THE AFORESAID DECISION OF THE ITAT. WE FIND T HAT THE ITAT WHILE ADJUDICATING SIMILAR ISSUES IN THE CONTEXT OF AFORESAID SEIZED DOCUMENT IN THE FORM OF PAGE IT(SS)A NO.127/D/2007 24 NO.23 TO 25 OF ANNEXURE-A1 IN THEIR DECISION DATED 17 TH APRIL, 2009 IN THE CASE OF ELITE PROMOTERS PVT. LTD. IN IT(SS)A NO. 128/DEL./2 007, CONCLUDED AS UNDER:- 48. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS IN TH E LIGHT OF MATERIAL PLACED ON RECORD AND THE JUDICIAL PRONOUNC EMENTS CITED BY THE LEARNED REPRESENTATIVES OF BOTH THE SIDES. I T IS OBSERVED THAT ALL THE FOUR IMPUGNED ADDITIONS WHICH ARE IN D ISPUTE IN GROUND NOS.1 TO 4 OF THE REVENUE'S APPEAL WERE MADE BY THE AO TO THE UNDISCLOSED INCOME OF THE ASSESSEE ON THE BASIS OF DOCUMENTS FOUND AND SEIZED I.E. ANNEXURE A-I PAGE 2 3 TO 25 IN THE CASE OF SEARCH OPERATION CONDUCTED IN TANEJA GR OUP. THE SAID DOCUMENTS WERE COMPUTER PRINTOUTS TAKEN ON PLA IN PAPERS AND WERE UNSIGNED. AS ALREADY OBSERVED, THEY WERE F OUND NOT FROM THE POSSESSION AND CONTROL OF THE ASSESSEE BUT FROM THE RESIDENCE OF SHRI D.N.TANEJA WHO WAS NEITHER THE DI RECTOR OF THE ASSESSEE COMPANY NOR ITS EMPLOYEE. THE STAND OF THE ASSESSEE, THEREFORE, AS TAKEN THROUGHOUT WAS THAT T HE SAID DOCUMENTS WERE NOTHING BUT DUMB DOCUMENTS ON THE BA SIS OF WHICH NO ADVERSE INFERENCE COULD BE DRAWN AGAINST I T, MUCH LESS ANY ADVERSE INFERENCE ABOUT HAVING EARNED SUBSTANTI AL INCOME OUTSIDE THE BOOKS OF ACCOUNT AS ALLEGED BY THE AO. WHEN THIS ISSUE CROPPED UP BEFORE THE TRIBUNAL IN THE FIRST R OUND, IT WAS FOUND BY THE TRIBUNAL AS A MATTER OF FACT THAT THE ENTRIES OF CHEQUE PAYMENTS APPEARING ON THE SAID SEIZED PAPERS WERE IN TOTAL AGREEMENT WITH THE CORRESPONDING ENTRIES APPE ARING IN THE BOOKS OF ACCOUNT OF THE ASSESSEE COMPANY. IT WAS, T HEREFORE, OBSERVED BY THE TRIBUNAL THAT THE SAID DOCUMENTS MI GHT NOT BE DUMB DOCUMENTS. THE TRIBUNAL, HOWEVER, WAS OF THE O PINION THAT BEFORE DRAWING ANY ADVERSE INFERENCE AGAINST T HE ASSESSEE ABOUT RECEIPT OF UNACCOUNTED CASH ON THE BASIS OF T HE SAID DOCUMENTS, NECESSARY ENQUIRIES SHOULD HAVE BEEN DON E BY THE AO. IN THIS REGARD, THE DENIAL BY THE CONCERNED PERSONS ABOUT HAVING ANY NEXUS OF THE ASSESSEE COMPANY WITH THE TRANSACTIONS IN CASH FOUND TO BE RECORDED IN THE SE IZED DOCUMENTS WAS TAKEN NOTE OF BY THE TRIBUNAL AND IT WAS OBSERVED THAT IN VIEW OF THE SAID DENIAL, MORE ENQU IRIES OUGHT TO HAVE BEEN MADE BY THE AO TO CORROBORATE HIS ALLEGATION ABOUT THE ALLEGED RECEIPT OF CASH BY THE ASSESSEE COMPANY OUTSIDE THE BOOKS OF ACCOUNT ON THE BASIS OF SAID DOCUMENTS . THE TRIBUNAL ACCORDINGLY POINTED OUT SUCH ENQUIRIES WHI CH THE AO OUGHT TO HAVE MADE AND RESTORED THE MATTER TO HIM F OR DECIDING THE SAME AFRESH AFTER MAKING SUCH ENQUIRIES AND AFT ER GIVING PROPER OPPORTUNITY TO THE ASSESSEE TO EXPLAIN THE M ATERIAL COLLECTED DURING THE COURSE OF SUCH ENQUIRY. THE AO THUS WAS DIRECTED BY THE TRIBUNAL TO ESTABLISH THE AUTHENTIC ITY OF THE IT(SS)A NO.127/D/2007 25 RELEVANT SEIZED DOCUMENTS ESPECIALLYTHE ENTRIES APP EARING THEREIN BY BRINGING ON RECORD THE CORROBORATIVE EVI DENCE. A PERUSAL OF THE ORDER OF THE AO PASSED AFRESH IN THE SET ASIDE PROCEEDINGS, HOWEVER, SHOWS THAT NO SUCH ENQUIRIES AS SPECIFICALLY POINTED OUT BY THE TRIBUNAL WERE PROPE RLY MADE BY HIM AND THE ADDITIONS WERE AGAIN MADE BY HIM TO THE UNDISCLOSED INCOME OF THE ASSESSEE ON THE BASIS OF THE RELEVANT SEIZED DOCUMENTS WITHOUT COMPLYING EFFECTIVELY WITH THE DIRECTIONS OF THE TRIBUNAL TO CORROBORATE THE SAME BY BRINGING THE RELEVANT MATERIAL ON RECORD. AS RIGHTLY SUBMITT ED BY THE LEARNED COUNSEL FOR THE ASSESSEE, THE LEARNED CIT(A ), HOWEVER, APPRECIATED THIS POSITION ESPECIALLY THE FAILURE OF THE AO TO FOLLOW THE DIRECTIONS OF THE TRIBUNAL IN THE RIGHT PERSPECTIVE AND DIRECTED THE LATTER TO MAKE SUCH ENQUIRIES AS SOUGH T BY THE TRIBUNAL AND TO FURNISH HIS REMAND REPORT THEREON. 49. AS PER THE DIRECTION OF THE LEARNED CIT(A), STA TEMENT OF SHRI DINESH JAIN WAS RECORDED BY THE AO ON 6.12.2006 AND A PERUSAL OF THE COPY OF THE SAID STATEMENT PLACED IN THE PAPER BOOK OF THE ASSESSEE SHOWS THAT WHILE REPLYING TO Q UESTION NOS.5 & 6, HE DENIED OF HAVING ANY KNOWLEDGE ABOUT THE RELEVANT SEIZED DOCUMENTS FOUND DURING THE COURSE O F SEARCH FROM THE PREMISES SITUATED AT 7, K.G.MARG, NEW DELH I. HE ALSO DENIED OF HAVING MADE ANY CASH PAYMENT ON ACCOUNT O F TRANSACTIONS RELATING TO PALM COURT PROPERTY AND CO NFIRMED OF HAVING MADE ALL THE PAYMENTS FOR PURCHASE OF THE SA ID PROPERTY TO THE ASSESSEE COMPANY BY CHEQUE OR DEMAND DRAFTS. HE ALSO CATEGORICALLY ASSERTED THAT HE WAS NOT AWARE OF ANY TRANSACTION OF SALE OF FARMHOUSE ALLEGEDLY MADE BY HIM TO SHRI VIPIN SHARMA AND SHRI TANEJA AS PER THE RELEVANT SEIZED D OCUMENTS. EVEN THE STATEMENT OF BOTH SHRI D.N.TANEJA AND SHRI RAVINDER TANEJA WERE ALSO RECORDED BY THE AO IN THE REMAND PROCEEDINGS WHEREIN THEY REITERATED THE STAND TAKEN EARLIER THAT THE RELEVANT SEIZED DOCUMENTS I.E. PAGES 23 TO 25 O F ANNEXURE A-I HAD NO CONNECTION WHATSOEVER WITH THE ASSESSEE COMPANY. IT WAS ALSO STATED BY THEM THAT THE ENTRIES REFLECT ED IN THE SAID DOCUMENTS EVEN OTHERWISE HAD NO CONNECTION WITH THE CONCLUDED TRANSACTIONS OF THE ASSESSEE COMPANY. THE EXAMINATION OF THE CONCERNED PERSONS BY THE AO AND THE DEPOSITIONS MADE BY THEM IN THEIR STATEMENTS RECORD ED DURING THE COURSE OF SUCH EXAMINATION THUS, DID NOT REVEAL ANYTHING WHICH COULD CORROBORATE THE CASE MADE OUT BY THE AO THAT THE RELEVANT SEIZED DOCUMENTS IN ANY MANNER WERE RELATE D TO THE ASSESSEE COMPANY AND THAT THE ENTRIES FOUND RECORDE D THEREIN REPRESENTED THE UNACCOUNTED MONEY RECEIVED BY IT AG AINST THE TRANSACTION OF SALE OF PALM COURT PROPERTY TO SHRI DINESH JAIN IT(SS)A NO.127/D/2007 26 AND HIS FAMILY MEMBERS. 50. BESIDES THE DENIAL OF THE CONCERNED PERSONS OF HAVING ANY KNOWLEDGE ABOUT THE RELEVANT SEIZED DOCUMENTS AS WE LL AS ENTRIES REFLECTED THEREIN IN THEIR STATEMENTS RECOR DED BY THE AO. IT WAS ALSO FOUND BY THE LEARNED CIT(A) FROM THE RE LEVANT DETAILS FURNISHED BY THE ASSESSEE COMPANY THAT THE RATES CH ARGED BY THE ASSESSEE COMPANY TO SHRI DINESH JAIN AND HIS FA MILY MEMBERS FOR SALE OF PALM COURT PROPERTY WERE COMPAR ABLE WITH THE RATES CHARGED TO OTHER PARTIES WHICH HAD BEEN A CCEPTED BY THE AO. THE DETAILS SO FURNISHED BY THE ASSESSEE CO MPANY IN THIS CONTEXT ARE PLACED AT PAGES 73 TO 81 OF THE AS SESSEE'S PAPER BOOK NO.2 AND A PERUSAL OF THE SAME REVEALS T HAT THE AVERAGE RATE CHARGED BY THE ASSESSEE COMPANY FOR SA LE OF PROPERTY TO SHRI DINESH JAIN AND HIS FAMILY MEMBERS WAS RS.L,000/- PER SQ. FT. AND RS.900/- PER SQ. FT. FOR GROUND FLOOR AND THIRD FLOOR RESPECTIVELY WHICH COMPARED WELL WITH T HE RATES CHARGED TO OTHER PARTIES FOR SALE OF FLATS IN THE S AME PROJECT ON OTHER FLOORS WHICH WAS IN THE RANGE OF RS.900/- TO RS.1,1 00/- PER SQ.FT. AS RIGHTLY SUBMITTED ON BEHALF OF THE AS SESSEE BEFORE THE LEARNED CIT(A) AS WELL AS BEFORE US AND ACCEPTE D BY THE LEARNED CIT(A), THIS POSITION CLEARLY EVIDENT FROM THE RELEVANT DETAILS FURNISHED BY THE ASSESSEE AND REMAINED UNCO NTROVERTED BY THE REVENUE AUTHORITIES WAS SUFFICIENT TO SHOW T HAT PALM COURT PROPERTY WAS ACTUALLY SOLD BY THE ASSESSEE CO MPANY TO SHRI DINESH JAIN AND HIS FAMILY MEMBERS AT A PRICE AS RECORDED IN THE REGULAR BOOKS OF ACCOUNT WHICH WAS A PREVAIL ING MARKET PRICE AND THE ALLEGATION MADE BY THE AO ABOUT RECEI PT OF ANY UNACCOUNTED MONEY AGAINST THE SALE OF THE SAID PROP ERTY ON THE BASIS OF THE RELEVANT SEIZED DOCUMENTS WAS NOT CORR ECT EVEN FROM THIS ANGLE. IT IS PERTINENT TO NOTE HERE THAT IF THE UNACCOUNTED CASH ALLEGEDLY RECEIVED BY THE ASSESSEE AGAINST THE TRANSACTION OF PALM COURT PROPERTY TO SHRI DINE SH JAIN AND HIS FAMILY MEMBERS IS TAKEN INTO CONSIDERATION, IT GIVES A SELLING RATE OF THE SAID PROPERTY WHICH IS MORE THAN TWO AN D A HALF TIMES OF THE SELLING RATES CHARGED BY THE ASSESSEE COMPAN Y TO OTHER PERSONS FOR THE SAME PROPERTY WHICH IS HIGHLY IMPRO BABLE. 51. THE ADDITIONS MADE BY THE AO THUS WERE BASED ME RELY ON THE BASIS OF RELEVANT SEIZED DOCUMENTS WHICH WERE U NSIGNED COMPUTER PRINTOUTS TAKEN ON PLAIN PAPER NOT FROM TH E COMPUTERS OF THE ASSESSEE COMPANY. THE SAID DOCUMENTS WERE NO T FOUND FROM THE CONTROL AND POSSESSION OF THE ASSESSEE BUT WERE FOUND FROM THE RESIDENCE OF SHRI D.N.TANEJA WHO WAS NEITHER THE DIRECTOR NOR THE EMPLOYEE OF THE ASSESSEE COMPA NY. MOREOVER, SHRI D.N.TANEJA HAD DENIED OF HAVING ANY IT(SS)A NO.127/D/2007 27 KNOWLEDGE ABOUT THE SAID DOCUMENTS AND HAD ALSO DEN IED ANY NEXUS BETWEEN THE SAID DOCUMENTS AND THE ASSESSEE COMPANY. EVEN SHRI DINESH JAIN WHO WAS ALLEGED TO H AVE PAID UNACCOUNTED MONEY TO THE ASSESSEE COMPANY FOR PURCH ASE OF PALM COURT PROPERTY ON THE BASIS OF THE SAID DOCUME NTS CATEGORICALLY DENIED IN HIS STATEMENT RECORDED BY T HE AO OF HAVING PAID ANY CASH TO THE ASSESSEE COMPANY AGAINS T THE TRANSACTION OF PALM COURT PROPERTY AND CONFIRMED IN UNEQUIVOCAL TERMS THAT THE ENTIRE PAYMENT TOWARDS CONSIDERATION OF THE SAID PROPERTY WAS PAID BY HIM EITHER BY CHEQUE OR BANK DRAFTS. THERE WAS THUS NOTHING THAT BROUGHT ON RECORD BY THE AO EITHER DURING THE COURSE OF SET AS IDE PROCEEDINGS OR EVEN DURING THE COURSE OF REMAND PRO CEEDINGS AT THE INSTANCE OF THE LEARNED CIT(A) TO CORROBORAT E THE CASE ATTEMPTED TO BE MADE OUT AGAINST THE ASSESSEE ON TH E BASIS OF SEIZED DOCUMENTS THAT SUBSTANTIAL UNACCOUNTED CASH WAS RECEIVED BY IT AGAINST SALE OF PALM COURT PROPERTY TO DINESH JAIN AND HIS FAMILY MEMBERS. AS ALREADY NOTED, THE RELEVANT SEIZED DOCUMENTS OR ENTRIES APPEARING THEREIN WERE NOT FOUND TO BE SUFFICIENT BY THE TRIBUNAL IN THE FACTS AND C IRCUMSTANCES OF THE ASSESSEE'S CASE AS WELL AS THE MATERIAL AVAILAB LE ON RECORD TO COME TO A CONCLUSION THAT SUCH UNACCOUNTED MONEY WAS ACTUALLY RECEIVED BY THE ASSESSEE COMPANY AND THE M ATTER, THEREFORE, WAS RESTORED TO THE FILE OF THE AO WITH A DIRECTION TO DECIDE THE SAME AFRESH AFTER BRINGING CORROBORATIVE EVIDENCE ON RECORD. SPECIFIC DIRECTIONS WERE ALSO GIVEN BY THE TRIBUNAL AS REGARDS THE ENQUIRIES REQUIRED TO BE CONDUCTED BY H IM IN THIS CONTEXT. SINCE THE AO HAS MISERABLY FAILED TO BRING ANY SUCH EVIDENCE TO CORROBORATE THE CASE ATTEMPTED TO BE MA DE OUT AGAINST THE ASSESSEE ABOUT RECEIPT OF UNACCOUNTED M ONEY ON THE BASIS OF RELEVANT SEIZED DOCUMENTS, WE ARE OF T HE VIEW THAT THE ADDITIONS MADE BY HIM MERELY ON THE BASIS OF TH E RELEVANT SEIZED DOCUMENTS WITHOUT THERE BEING ANYTHING TO CO RROBORATE THE SAME WERE NOT SUSTAINABLE ESPECIALLY WHEN ANY N EXUS OF THE SAID DOCUMENTS WITH THE ASSESSEE COMPANY OR THE ENTRIES APPEARING THEREIN WITH THE TRANSACTIONS ENTERED INT O BY IT WAS DENIED BY ALL THE CONCERNED PARTIES. 52. IN THE CASE OF CIT VS. VED PRAKASH CHAUDHARY (S UPRA), ADDITION ON ACCOUNT OF MONEY RECEIVED OUTSIDE THE BOOKS OF A CCOUNT WAS MADE ON .THE BASIS OF MOU FOUND DURING THE COURSE O F SEARCH. THE CONCERNED PARTIES, HOWEVER, HAD DENIED ANY MONEY HA VING BEEN PAID OR RECEIVED IN CASH AND IT WAS HELD BY THE HON 'BLE DELHI HIGH COURT THAT IN VIEW OF SUCH DENIAL, THERE OUGHT TO H AVE BEEN CORROBORATIVE EVIDENCE BROUGHT ON RECORD BY THE AO TO SHOW THAT THERE WAS IN FACT SUCH A TRANSFER OF MONEY. AS NO S UCH IT(SS)A NO.127/D/2007 28 CORROBORATIVE EVIDENCE WAS AVAILABLE ON RECORD, IT WAS HELD BY THE HON'BLE DELHI HIGH COURT THAT NO ADDITION WAS SUSTA INABLE MERELY ON THE BASIS OF MOU. AS RIGHTLY SUBMITTED BY THE LE ARNED COUNSEL FOR THE ASSESSEE, THE ASSESSEE IN THE PRESENT CASE STANDS ON A BETTER FOOTING INASMUCH AS THE RELEVANT SEIZED DOCU MENT RELIED UPON BY THE AO TO DRAW AN ADVERSE INFERENCE AGAINST THE ASSESSEE ABOUT RECEIPT OF UNACCOUNTED MONEY WAS A COMPUTER P RINTOUT TAKEN ON A PLAIN PAPER WHICH WAS UNSIGNED AND WHICH WAS F OUND NOT FROM THE POSSESSION AND CONTROL OF THE ASSESSEE WHEREAS IN THE CASE OF VED PRAKASH CHOUDHARY DECIDED BY THE HON'BLE DELHI HIGH COURT, THE EVIDENCE RELIED UPON BY THE AO WAS A MOU SIGNED BY BOTH THE PARTIES WHICH WAS FOUND AND SEIZED FROM THE POSSESS ION OF THE ASSESSEE. 53. IN THE CASE OF CIT VS. KULWANT RAI (SUPRA), ADD ITION WAS MADE TO THE INCOME OF THE ASSESSEE ON THE BASIS OF AGREE MENT FOUND FROM HIS POSSESSION. THE ASSESSEE HOWEVER, HAD NOT SIGNED THE SAID AGREEMENT AND IN THE ABSENCE OF HIS SIGNATURE, IT WAS HELD BY THE HON'BLE DELHI HIGH COURT THAT NO LIABILITY COUL D BE ATTRIBUTED TOWARDS THE ASSESSEE QUA TO THE SAID AGREEMENT AND THE ADDITION MADE IN THE ABSENCE OF ANY CORROBORATIVE EVIDENCE W AS BASED ON SURMISES AND GUESS WORK, WHICH WAS NOT SUSTAINABLE. IN THE PRESENT CASE, THE UNSIGNED COMPUTER PRINT OUT ON TH E BASIS OF WHICH IMPUGNED ADDITIONS WERE MADE BY THE ASSESSING OFFIC ER WAS NOT EVEN FOUND FROM THE POSSESSION OF THE ASSESSEE, BUT THE SAME WAS FOUND FROM THE POSSESSION AND CONTROL OF SHRI D. N. TANEJA, WHO WAS NEITHER THE DIRECTOR NOR THE EMPLOYEE OF THE AS SESSEE COMPANY. THE ASSESSEE THUS STANDS ON A BETTER FOOTI NG THAN THE ASSESSEE IN THE CASE OF SHRI KULWANT RAI (SUPRA), W HEREIN THE ADDITION MADE ON THE BASIS OF AGREEMENT FOUND FROM THE POSSESSION OF THE ASSESSEE WAS HELD TO BE UNSUSTAIN ABLE BY THE DELHI HIGH COURT ON THE GROUND THAT THE SAID AGREEM ENT WAS NOT SIGNED BY THE ASSESSEE AND THERE WAS NO OTHER CORRO BORATIVE EVIDENCE TO SUPPORT AND SUBSTANTIATE THE CASE OF TH E REVENUE. SINCE THE RELEVANT DOCUMENTS IN THE FORM OF COMPUTER PRINT OUT TAKEN ON PLAIN PAPER ON THE BASIS OF WHICH THE IMPU GNED ADDITIONS WERE MADE BY THE ASSESSING OFFICER, WAS N OT FOUND FROM THE CONTROL AND POSSESSION OF THE ASSESSEE, EV EN PRESUMPTION ULS.132(4A) WAS NOT AVAILABLE TO BE DRA WN AGAINST THE ASSESSEE. THE ONUS, THEREFORE, WAS ON THE REVEN UE AND NOT ON THE ASSESSEE TO ESTABLISH THAT THE SAID DOCUMENT S, ESPECIALLY THE ENTRIES APPEARING THEREIN, WERE PERTAINING TO T HE ASSESSEE COMPANY AND THE TRANSACTIONS ALLEGEDLY REFLECTED TH EREIN WERE THE TRANSACTIONS ACTUALLY MATERIALIZED AND ENTERED INTO BY THE ASSESSEE COMPANY. FOR THIS PURPOSE, IT WAS INCUMBEN T UPON THE ASSESSING OFFICER TO BRING ON THE RECORD COGENT, CO RROBORATIVE IT(SS)A NO.127/D/2007 29 EVIDENCE TO SUPPORT HIS CASE AS OBSERVED EVEN BY TH E TRIBUNAL IN ITS APPELLATE ORDER PASSED IN THE ASSESSEE'S CAS E IN THE FIRST ROUND AND HAVING FAILED TO DO SO, WE ARE OF THE VIE W THAT THE RELEVANT DOCUMENTS WAS NOT A RELIABLE EVIDENCE AND THE ENTRIES FOUND AND RECORDED THEREIN COULD NOT BE RELIED UPON TO DRAW AN ADVERSE INFERENCE AGAINST THE ASSESSEE OF HAVING EA RNED SUBSTANTIAL AND UNDISCLOSED INCOME AS SOUGHT TO BE DONE BY THE ASSESSING OFFICER, ESPECIALLY WHEN THERE WAS NOTHIN G BROUGHT ON RECORD BY HIM TO CORROBORATE HIS ALLEGATION. FOR THIS CONCLUSION, WE ALSO DERIVE SUPPORT FROM THE DECISIO N OF HON'BLE DELHI HIGH COURT IN THE CASE OF D.K. GUPTA (SUPRA) WHEREIN IT WAS HELD THAT THERE BEING NO CORROBORATIVE OR DIREC T EVIDENCE TO PRESUME THAT THE NOTINGS/JOTTINGS IN THE SEIZED DOC UMENTS HAD MATERIALIZED INTO TRANSACTIONS GIVING RISE TO INCOM E NOT DISCLOSED IN THE REGULAR BOOKS OF ACCOUNTS, NO ADDITION COULD BE MADE TO THE UNDISCLOSED INCOME OF THE ASSESSEE ON THE BASIS OF SUCH NOTINGS /JOTTINGS. 54. HAVING HELD THAT THE RELEVANT DOCUMENTS I.E. PA GE 23 TO 25 OF ANNEXURE-AL FOUND FROM THE POSSESSION AND CONTRO L OF SHRI D.N. TANEJA WAS NOT A EVIDENCE, WHICH COULD BE RELI ED UPON TO MAKE AN ADDITION TO THE UNDISCLOSED INCOME OF THE A SSESSEE IN THE ABSENCE OF ANY CORROBORATIVE EVIDENCE, IT FOLLO WS THAT ALL THE FOUR ADDITIONS MADE BY THE ASSESSING OFFICER TO THE UNDISCLOSED INCOME OF THE ASSESSEE ON THE BASIS OF THE SAID DOC UMENTS CAN NOT BE SUSTAINED AS RIGHTLY HELD BY THE LD. CIT(A). HOWEVER, AS THE REVENUE HAS DISPUTED THE DELETIONS OF ALL THE F OUR ADDITIONS BY THE LD. CIT(A) IN THE FOUR SEPARATE GROUNDS RAIS ED IN ITS APPEAL, IT WOULD BE PROPER ON OUR PART TO TOUCH UPO N EACH OF THESE ADDITIONS SEPARATELY FOR THE SAKE OF COMPLETE NESS OF THIS ORDER. WE ACCORDINGLY, PROCEED TO DO SO. IN THIS RE GARD, WE MAY OBSERVE THAT THE MAIN ADDITION, WHICH IS IN DISPUTE IN GROUND NO.1, IS THAT OF RS.3,71,55,000/- MADE ON ACCOUNT O F UNACCOUNTED MONEY ALLEGEDLY RECEIVED BY THE ASSESSE E COMPANY TOWARDS SALE OF PALM COURT PROPERTY TO SHRI DINESH JAIN AND HIS FAMILY MEMBERS. THIS ISSUE HAS ALREADY BEEN DEALT BY US ELABORATELY WHILE CONSIDERING THE ISSUE RELAT ING TO THE AUTHENTICITY OR THE RELIABILITY OF THE DOCUMENTS FO UND AND SEIZED FROM THE POSSESSION OF SHRI D.N.TANEJA. AS ALREADY HELD BY US HAVING REGARD TO THE DENIAL OF THE CONCERNED PARTIE S, THE COMPARABILITY OF THE RATES CHARGED BY THE ASSESSEE COMPANY TO THE DINESH JAIN AND FAMILY MEMBERS FOR SALE OF PALM COURT PROPERTY WITH THE RATES CHARGED TO OTHER PARTY FOR SALE OF THE SAME PROPERTY AND THE FAILURE OF THE ASSESSING OFFI CER TO BRING ON RECORD ANY CORROBORATIVE EVIDENCES TO SUPPORT AN D SUBSTANTIATE HIS ALLEGATION ABOUT RECEIPT OF UNACCO UNTED MONEY IT(SS)A NO.127/D/2007 30 ALLEGEDLY RECEIVED BY THE ASSESSEE COMPANY, THE ADD ITION MADE ON THIS ISSUE WAS NOT SUSTAINABLE AND THE LD. CIT(A) THEREFORE, WAS FULLY JUSTIFIED ON DELETING THE SAME . 55. SIMILARLY, THE AMOUNT OF RS.72,99,962/- ADDED TO THE UNDISCLOSED INCOME OF THE ASSESSEE ON ACCOUNT OF IN TEREST FROM SHRI DINESH JAIN AND GROUP WAS HELD TO BE UNSUSTAIN ABLE BY THE LD. CIT(A) ON THE GROUND THAT THERE WAS NO CORR OBORATIVE EVIDENCES BROUGHT ON RECORD BY THE ASSESSING OFFICE R TO ESTABLISH THAT ANY SUCH AMOUNT WAS ACTUALLY RECEIVE D BY THE ASSESSEE OR WAS RECEIVABLE TO IT FROM SHRI DINESH J AIN AND FAMILY MEMBERS. MOREOVER, IN THE RELEVANT DOCUMENTS , THE SAID AMOUNT WAS SHOWN AS 'TO BE RECEIVED' AND THERE BEIN G NOTHING BROUGHT ON RECORD BY THE ASSESSING OFFICER TO SHOW THAT THE SAID AMOUNT WAS ACTUALLY RECEIVED BY THE ASSESSEE C OMPANY PRIOR TO THE DATE OF SEARCH, THE LD. CIT(A) HELD, A ND IN OUR OPINION RIGHTLY SO, THAT THE ADDITION THEREOF TO TH E UNDISCLOSED INCOME OF THE ASSESSEE FOR THE BLOCK PERIOD WAS BEY OND THE SCOPE OF BLOCK ASSESSMENT. AS REGARDS, THE THIRD AD DITION OF RS.31 ,25,000/- MADE ON THE BASIS OF ENTRIES FOUND RECORDED ON THE RELEVANT DOCUMENTS , IT IS OBSERVED THAT THERE WAS SOME INDICATION IN THE RELEVANT DOCUMENTS ABOUT THE ADJU STMENT ON ACCOUNT OF LOSS ON SALE OF FARM HOUSE. ON THIS BASI S, IT WAS HELD BY THE ASSESSING OFFICER THAT THERE WAS SOME SALE O F FARM HOUSE BY SHRI DINESH JAIN TO THE ASSESSEE AND THE UNACCOUNTED MONEY INVOLVED IN THE SAID TRANSACTION WAS ADJUSTED AGAINST THE TRANSACTION IN RESPECT OF SALE OF PALM COURT PROPERTY. THERE WAS HOWEVER, NO EVIDENCE BROU GHT ON RECORD TO SHOW THAT ANY SUCH TRANSACTION WAS ACTUAL LY MATERIALIZED BETWEEN THE ASSESSEE COMPANY AND SHRI DINESH JAIN. IN HIS STATEMENT RECORDED BY THE ASSESSING OF FICER, SHRI DINESH JAIN HAD ALSO DENIED OF HAVING ANY KNOWLEDGE OF ANY SUCH TRANSACTION FOR SALE OF FARM HOUSE. THE ADDITION MADE BY THE ASSESSING OFFICER ON THIS ISSUE, THUS, WAS EVEN OTH ERWISE NOT WELL FOUNDED AND THE LD. CIT(A), IN OUR OPINION, WAS FUL LY JUSTIFIED IN DELETING THE SAME. 5.1 WE FIND THAT THOUGH THE AO ISSUED VARIOUS S HOWCAUSE NOTICES REFERRED TO IN THE ASSESSMENT ORDER , THE DIRECTIONS OF THE ITA T IN THEIR ORDER DATED 26.8.2005 WERE NOT COMPLIED WITH ,AS POINTED OUT BY THE LD. CIT(A). IT WAS ONLY DURING THE REMAND PROCEEDINGS THAT THE STATEMENTS O F SHRI DINESH JAIN, SHRI D.N.TANEJA AND SHRI RAVINDER TANEJA WERE RECORDED. SHRI DINESH JAIN IN HIS STATEMENT RECORDED BY THE AO ON 6.12.2006 DENIED H AVING GIVEN ANY CASH TO THE IT(SS)A NO.127/D/2007 31 ASSESSEE BESIDES DENYING THE CONTENTS OF THE SEIZED DOCUMENTS ON THE BASIS OF WHICH ADDITION HAS BEEN MADE BY THE AO. SHRI DINESH JAIN CATEGORICALLY STATED THAT FOR THE TRANSACTION RELATING TO THE PURCHASE OF PALM COURT FLATS FROM THE ASSESSEE, ALL THE PAYMENTS HAD BEEN MADE THROUGH CH EQUES AND DD, DULY REFLECTED IN THE BOOKS OF ACCOUNT OF THE ASSESSEE. SIMILARLY SHRI D.N. TANEJA, IN HIS STATEMENT RECORDED BY THE AO ON 22.1.2007, STA TED THAT SIZED DOCUMENTS AS PER PAGE 24 OF ANNEXURE A-1 DID NOT BELONG TO M/ S. ELITE PROMOTERS (P) LTD AND WERE NOT FROM THE COMPUTER SEIZED AT THE TIME O F THE SEARCH IN THEIR OFFICES AS WELL AS RESIDENCES. SHRI RAVINDER TANEJA ALSO I N HIS STATEMENT RECORDED BY THE AO ON THE SAME DAY DENIED THAT THESE PAPERS BEL ONGED TO THE ASSESSEE COMPANY. IN THE LIGHT OF THESE STATEMENTS, THE LD. CIT(A) CONCLUDED THAT THE A.O COULD NOT BRING ANY MATERIAL NOR GATHERED ANY FACTS FROM THESE PERSONS TO SUPPORT THE ASSUMPTION FOR SUSTAINING THE ADDITION AND THAT THERE WAS NOTHING TO SUGGEST THAT ANY CASH PAYMENT WAS MADE BY SHRI DINE SH JAIN OR HIS FAMILY MEMBERS WHILE PRINTOUT IN THE FORM OF AFORESAID SEI ZED DOCUMENT WAS ALSO STATED TO BE NOT GENERATED FROM THEIR COMPUTERS. AS REGAR DS SALE INSTANCES IN RESPECT OF FOUR COMPANIES ONLY, NAMELY, M/S. SHRI JAQANNATH SECURITIES (P) LTD., M/S. ANTRIKSH LAND PROMOTERS (P)LTD., M/S. CHANDRA ADVER TISING (P) LTD., AND M/S. LALL CONSTRUCTION (P) LTD., THE LD. CIT(A) WHILE REFERRI NG TO THE FINDINGS OF THE AO IN THE CASE OF M/S ELITE PROMOTERS P LTD. CONCLUDED THAT THE SALES HAVE NOT BEEN MADE TO ANY OF THESE PARTIES AND THESE WERE NOT GENUINE ENTRIES. WHILE REFERRING TO LARGE NUMBER OF SALES INSTANCES MADE TO OTHER PART IES, THE LD. CIT(A) HELD THAT THE VALUE RECORDED FOR SALES OF FL ATS TO MR. DINESH JAIN AND FAMILY MEMBERS IS CORRECT AND PRESUMPTION DRAWN AGA INST THE ASSESSEE THAT HE RECEIVED 'ON MONEY' OVER AND ABOVE THE ACCOUNT ED FOR CONSIDERATION, COULD NOT BE SUSTAINED IN VIEW OF THESE SALES INSTA NCES. SINCE N O ADDITION WAS MADE IN THE HANDS OF SHRI DINESH JAIN TO WHOM THE A SSESSEE SOLD THE PROPERTY WHILE THE AFORESAID SEIZED DOCUMENT WAS NOT FOUND I N THE PREMISES OF THE ASSESSEE AND THE PERSONS FROM WHOSE POSSESSION THIS DOCUMENT WAS FOUND ALSO DENIED THE OWNERSHIP OF THE DOCUMENT AND SHRI D.N. TANEJA AND SHRI RAVINDER TANEJA BOTH CATEGORICALLY TOOK A STAND TH AT THE PRINT OUT WAS ALSO NOT IT(SS)A NO.127/D/2007 32 FROM THEIR COMPUTER NOR THE CONTENT OF THIS DOCUMEN T WAS FOUND IN THEIR COMPUTER AND NONE OF THE BUYER, SELLER OR COLLABORATOR MAD E ANY ALLEGATION OF THE 'ON MONEY' PAYMENT, THE LD. CIT(A) DELETED THE ADDITION OF ` 4,30,00,000/- IN THE FORM OF UNACCOUNTED CASH PAYMENT AS ALSO OF ` 97,11,030/-. LIKEWISE IN THE ABSENCE OF ANY EVIDENCE BROUGHT ON RECORD TO SHOW THAT ANY SUCH T RANSACTION WAS ACTUALLY MATERIALIZED BETWEEN THE ASSESSEE COMPANY AND SHRI DINESH JAIN, THE LD. CIT(A) DELETED THE ADDITION OF ` 31,25,000/-.SINCE THE REVENUE HAVE NOT PLACED BEFORE US ANY MATERIAL CONTROVERTING THE AFORESAID FINDINGS OF THE LD. CIT(A) SO AS TO ENABLE US TO TAKE A DIFFERENT V IEW IN THE MATTER WHILE A CO-ORDINATE BENCH IN THEIR AFORESAID DECISION DATED 17.4.2009 IN THE CASE OF ELITE PROMOTERS PVT. LTD. IN IT(SS)A NO. 128/DEL./2 007 WHILE REFERRING TO DECISIONS OF THE HONBLE JURISDICTIONAL HIGH COURT IN CIT VS. KULWANT RAI,291 ITR 36; CIT VS. VED PARKASH CHAUDHARY,305 ITR 245;A ND CIT VS. D.K.GUPTA,308 ITR 230 ,DELETED SIMILAR ADDITIONS MA DE ON THE STRENGTH OF SAME SEIZED DOCUMENT I.E. PAGE NO.23 TO 25 OF ANNEX URE A-1, WE HAVE NO ALTERNATIVE BUT TO UPHOLD THE FINDINGS OF THE LD. C IT(A).CONSEQUENTLY, GROUND NOS .I) TO III) IN THE APPEAL ARE DISMISSED. 6.. GROUND NO.(IV) IN THE APPEAL RELATES TO AN ADDI TION OF ` ` 33,09,900/- IN RESPECT OF CASH RECEIVED FROM PARVEEN ARORA AND FAM ILY. THE AO NOTICED CERTAIN DETAILS ON PERUSAL OF PAGE 7 OF ANNEXURE-A1 SEIZED FROM THE RESIDENCE OF SHRI DN TANEJA, 7, K.G MARG, NEW DELHI, WHICH REFLECTED THE HAND WRITTEN ACCOUNT OF PRAVEEN DILBAGH. TO A QUERY BY THE AO, SHRI DN TA NEJA REPLIED THAT PAGE 7 RELATES TO SHRI PARVEEN ARORA WITH WHOM THEY HAD EN TERED INTO PROPERTY DEAL THROUGH BROKER SHRI BABLOO SHARMA. THE VARIOUS PRO PERTIES MENTIONED ON THE RIGHT SIDE OF THE PAGE WERE SOLD FOR A CONSIDERATIO N OF ` 5.25 CRORES. THE TOTAL DEAL WAS SETTLED FOR ` `5.50 CRORES FOR THE FOLLOWING PURPOSES:- A) ` `19.50 LACS FOR STAMP PAPERS. B) ` ` 1.50 LACS FOR REGISTRATION CHARGES. C) ` ` 1.50 LACS FOR REGISTRATION CHARGES. IT(SS)A NO.127/D/2007 33 D) ` `4 LACS PAYABLE TO BABLOO SHARMA ON VACATION OF PR OPERTY BEARING NO.8, DESH BANDHU GUPTA ROAD, KAROL BAGH, NEW DELHI. 6.1 OUT OF ` ` 5.25 CRORES, THE ASSESSEE RECEIVED ` ` 3.9 CRORES THROUGH CHEQUES AND BALANCE WAS TO BE RECEIVED FROM SHRI PA RVEEN ARORA AFTER VEACATION OF THE PROPERTY BEARING NO.8, DESH BANDHU GUPTA ROAD, KAROL BAGH, NEW DELHI. THE DETAILS OF TRANSACTIONS RELATING TO PRAVEEN KUMAR ARORA AND FAMILY GIVEN IN THE BOOKS OF ACCOUNT OF THE ASSESS EE HAVE BEEN MENTIONED ON PAGE 22 TO 23 OF THE ASSESSMENT ORDER. . SINCE THE ASSESSEE DID NOT FILE ANY EXPLANATION OR DETAILS, OR ANALYSIS OF THE FACTS AN D CONTENTS OF THE SEIZED MATERIAL DESPITE SHOWCAUSE NOTICES DATED 2.2.2006 & 20.2.2006, THE AO OBSERVED AS UNDER: (I) THERE IS NO DENYING FACT THAT THE FAMILY MEMBER S OF DILBAGH RAI ARORA HAVE PURCHASED CERTAIN PROPERTIES FROM THE TANEJA GROUP OF COMPANIES. THE ASSESSEE HAS ALSO CO NFIRMED THE SAME. (II) THE ASSESSEE GROUP HAS ALSO BEEN PROVED TO HAV E RECEIPT CASH IN ADDITION TO THE ACCOUNTED PORTION O F THE SALES CONSIDERATION FOR THE PROPERTIES SOLD BY THEM IN TH EIR TRANSACTIONS WITH THE OTHER GROUPS, LIKE SH. DINESH JAIN GROUP. (C) THE EARLIER SUBMISSION OF THE ASSESSEE THAT TH E LEFT HAND SIDE OF THE PAGE IS THE SCHEDULE OF PAYMENT AND THE RIGHT HAND SIDE OF THE PAGE IS DETAILS OF CHEQUES .RECEIVED AN D THEY ARE THE SAME IS NOT ACCEPTABLE FOR THE FOLLOWING REASONS; I) WHEREAS THE LEFT HAND SIDE OF THE PAGE CONTAINS FIGURES IN THE DENOMINATION OF LAKHS THE RIGHT HAND SIDE OF THE PAGE CONTAINS FIGURES IN DENOMINATIONS OF LAKHS , THOUSANDS AND HUNDREDS. II) NONE OF THE FIGURES AND DATES APPEARING ON THE LEFT HAND SIDE TALLY WITH THE FIGURES AND DATED AS APPEA RING ON THE RIGHT HAND SIDE OF THE PAGE. (D) THEREFORE, THE INFERENCE WHICH CAN BE DRAWN FR OM THE PRECEDING DISCUSSIONS IS THAT THE ASSESSEE GROUP HA S RECEIVED CHEQUES OF RS.5.25 CRORES AND ALSO AN EQUIVALENT AM OUNT OF RS. 5.25 CRORES IN CASH FROM THE FAMILY MEMBERS OF SH. DILB AGH RAI ARORA/ IT(SS)A NO.127/D/2007 34 PRAVEEN ARORA, WHICH MEANS THAT M/S ELITE PROMOTORS PVT. LTD AND M/S DYNAMIC UNIVERSAL LTD HAVE RECEIVED AN EQUIVALENT A MOUNT OF RS. 33,09,900/- IN CHEQUES AS WELL AS IN CASH FROM SH. PRAVEEN ARORA. (E) REGARDING THE CHEQUE PAYMENT OF RS. 33,09,900/ - APPEARING ON PAGE 7 OF ANNEXURE A-2, PERUSAL OF THE LEDGER OF THE ASSESSEE SUBMITTED DURING THE COURSE OF THE ASSESSMENT PROCE EDING FOR A Y 2002-03 HAT THE ASSESSEE HAS RECEIVED AN AMOUNT OF RS. 16,54,950/- EACH FROM SH RAJ KUMAR ARORA AND SMT. REENA ARORA. THEREFORE, NO ADVERSE INFERENCE IS DRAWN ON THIS POINT. 6.2 ACCORDINGLY, THE AO ADDED AN AMOUNT OF ` `33,09,900/- IN THE FOLLOWING TERMS:- 8.4 ON THE BASIS OF THE ANALYSIS OF FACTS AND MATER IALS AVAILABLE IN PARA 8.3, THE ASSESSEE GROUP HAS BEEN PROVED TO HAVE REC EIVED AN AMOUNT OF ` `5.25 CRORES FROM THE SHRI PRAVEEN ARORA & FAMILY M EMBERS IN CHEQUES/DRAFTS AND ALSO AN EQUIVALENT AMOUNT IN CAS H. THEREFORE, AN AMOUNT OF ` ` 33,09,900/- WAS RECEIVED IN CASH AND AN EQUIVALENT AMOUNT WAS ALSO RECEIVED IN CHEQUE BY THE ASSESSEE FROM SH RI PRAVEEN ARORA AND FAMILY. AN AMOUNT OF ` `33,09,900/- HAS BEEN SHOWN IN THE BOOKS OF THE ASSESSEE IN THE FINANCIAL YEAR 2001-02 BUT AN E QUIVALENT AMOUNT OF ` ` 33,09,900/- RECEIVED IN CASH AND NOT SHOWN IN THE B OOKS OF ACCOUNTS IS/ ADDED BACK TO THE TOTAL INCOME OF THE ASSESSEE AS U NACCOUNTED INCOME RECEIVED FROM SHRI PRAVEEN ARORA & FAMILY FOR SALE OF PROPERTIES IN THE ASSESSMENT YEAR 2002-03. 7. ON APPEAL, THE LEARNED CIT(A) DELETED THE ADDITI ON, HOLDING AS UNDER:- 6.3 I HAVE CONSIDERED THE SUBMISSION OF THE APPELL ANT QUITE CAREFULLY. ON GOING THROUGH THE ASSESSMENT ORDER I NOTICE THAT THE AFORESAID ADDITION HAS BEEN MADE BY THE ASSESSING O FFICER WITHOUT REFERRING TO ANY MATERIAL BUT ON THE BASIS OF ASSUM PTION. IN PARA 8.3 (E) AND IN PARA 8.4 ON PAGE 24 OF THE ASSESSMEN T ORDER THE ASSESSING OFFICER HAS STATED: (E) REGARDING THE CHEQUE PAYMENT OF `RS.33,09,900/ - APPEARING ON PAGE 7 OF ANNEXURE A-2, PERUSAL OF THE LEDGER OF THE APPELLANT SUBMITTED DURING THE COURSE OF THE ASSESSMENT PROCEEDING FOR ASSESSMENT YEAR 2002-03 REVEALS THAT THE APPELLANT HAS RECEIVED AN AMOUNT O F `RS.16,54,950/- EACH FROM SHRI RAJ KUMAR ARORA AND SHRI REENA ARORA. THEREFORE, NO ADVERSE INFERENCE /IS D RAWN ON THIS POINT. IT(SS)A NO.127/D/2007 35 8.4 ON THE BASIS OF THE ANALYSIS OF FACTS AND MATER IALS AVAILABLE IN PARA 8.3, THE ASSESSEE GROUP HAS BEEN PROVED TO HAVE RECEIVED AN AMOUNT OF RS.5.25 CRORES FROM T HE SHRI PRAVEEN ARORA & FAMILY MEMBERS IN CHEQUES/DRAFTS AN D ALSO AN EQUIVALENT AMOUNT IN CASH. THEREFORE, AN AMOUNT OF RS.`33,09,900/- WAS RECEIVED IN CASH AND AN EQUIVAL ENT AMOUNT WAS ALSO RECEIVED IN CHEQUE BY THE ASSESSEE FROM SHRI PRAVEEN ARORA AND FAMILY. AN AMOUNT OF RS.`33,09,900/- HAS BEEN SHOWN IN THE BOOKS OF THE ASSESSEE IN THE FINANCIAL YEAR 2001-02 BUT AN EQUIV ALENT AMOUNT OF RS.`33,09,900/- RECEIVED IN CASH AND NOT SHOWN IN THE BOOKS OF ACCOUNTS IS/ ADDED BACK TO THE TOTAL I NCOME OF THE ASSESSEE AS UNACCOUNTED INCOME RECEIVED FROM SH RI PRAVEEN ARORA & FAMILY FOR SALE OF PROPERTIES IN TH E ASSESSMENT YEAR 2002-03. THE ABOVE OBSERVATION OF THE A.O. MAKES IT VERY CLE AR THAT THIS ADDITION OF RS.`33,09,900/- HAS BEEN MADE ONLY ON THE BASIS OF INFERENCE WITHOUT THERE BEING ANY MATERIAL ON THE PRESUMPTION THAT SINCE THE AMOUNT OF `RS.33,09,900/- HAS BEEN SHOWN IN THE BOOKS OF ACCOUNT, A SIMILAR AMOUNT WOULD HAVE BEEN RECEIV ED IN CASH. IN BLOCK ASSESSMENT NO ADDITION CAN BE MADE MERELY ON THE BASIS OF ANY DOUBT OR PRESUMPTION. I ALSO NOTICE THAT NO QU ESTIONS WERE ASKED ON THIS AMOUNT FROM THE APPELLANT WHEN A STAT EMENT WAS RECORDED AND AS ALSO FROM SHRI RAVINDER TANEJA AND SHRI D.N. TANEJA WHOSE STATEMENT WERE RECORDED AS LATE AS IN JANUARY, 2007. THUS, I HOLD THAT THERE IS NO JUSTIFICATION FOR MAKING THE ABOVE ADDITION AND THE SAME IS DIRECTED TO BE DELET ED. WITHOUT PREJUDICE TO THIS FINDING IT CAN BE SEEN THAT THE H ONBLE ITAT IN THEIR ORDER DATED 26.08.2005 HAD SET ASIDE THE SPECIFIC I SSUES OF THE ADDITION AND NOT THE ENTIRE ASSESSMENT ORDER AND TH EREFORE, THE ASSESSING OFFICER WAS OTHERWISE ALSO NOT AUTHORIZED TO RAISE NEW ISSUE AND TO MAKE FRESH ADDITION IN SUCH BLOCK ASSE SSMENT ORDER WHICH HAD TO BE PASSED KEEPING IN VIEW THE SPECIFIC DIRECTIONS OF THE ITAT. I HAVE ALSO GONE THROUGH THE DECISION GI VEN BY THE HONBLE RAJASTHAN HIGH COURT IN THE CASE OF CIT VS. FUNDI LAL RIKHABCHAND (208 ITR 348). ON PERUSAL OF THE SAID ORDER IT IS SEEN THAT IN THAT CASE THE ASSESSMENT ITSELF WAS SET ASI DE FULLY WITH A DIRECTION TO EXAMINE THE CASE AFRESH AND UNDER SUCH CIRCUMSTANCES IT CAN BE SAID THAT THERE WAS NO RESTRICTIONS IMPOS ED BY THE ITAT ON THE INCOME TAX OFFICERS POWER TO ENHANCE THE ADDIT ION ON ACCOUNT OF INVESTMENT IN THE CONSTRUCTION OF A HOUSE. HOWE VER, IN THE PRESENT CASE THE ASSESSMENT WAS NOT SET ASIDE WITH THE SPECIFIC DIRECTIONS OF THE ITAT DELHI. WITH THIS FACTUAL AN D LEGAL DISCUSSION, I HEREBY DIRECT THE ASSESSING OFFICER TO DELETE THE SAID ADDITION OF RS.`33,09,000/-. IT(SS)A NO.127/D/2007 36 8. THE REVENUE IS NOW IN APPEAL BEFORE US AGAINST T HE FINDINGS OF THE LD. CIT(A). BOTH THE PARTIES AGREED THAT THAT THE ISS UE IS SQUARELY COVERED BY THE AFORESAID DECISION DATED 17 TH APRIL, 2009 OF THE ITAT IN THE CASE OF ELITE PROMOTERS PVT. LTD. 9.. WE HAVE HEARD BOTH THE PARTIES AND GONE THROUGH THE FACTS OF THE CASE AS ALSO THE AFORESAID DECISION OF THE ITAT. WE FIND T HAT THE ITAT WHILE ADJUDICATING A SIMILAR ISSUE IN THEIR AFORESAID ORDER DATED 17 TH APRIL, 2009 CONCLUDED AS UNDER:- 73. AFTER CONSIDERING THE RIVAL SUBMISSIONS AND PE RUSING THE MATERIAL ON RECORD, WE FIND NO JUSTIFIABLE REASON T O INTERFERE WITH THE IMPUGNED ORDER OF THE LEARNED CIT(A) APPEAL DELETIN G THE ADDITION OF `RS.33,09,900/- MADE BY THE ASSESSING OFFICER ME RELY ON THE BASIS OF PRESUMPTION AND SURMISES WITHOUT THERE BEI NG ANY COGENT MATERIAL TO SUPPORT AND SUBSTANTIATE THE SAME. THE RE WAS NO MATERIAL EITHER FOUND DURING THE COURSE OF SEARCH O R EVEN BROUGHT ON RECORD DURING THE COURSE OF BLOCK ASSESSMENT PRO CEEDINGS BY THE ASSESSING OFFICER TO ESTABLISH THAT THE AMOUNT OF `RS.33,09,900/- WAS RECEIVED BY THE ASSESSEE COMPAN Y IN CASH FROM SHRI PRAVEEN ARORA AND HIS FAMILY OUTSIDE THE BOOKS OF ACCOUNTS. MOREOVER, NO SUCH ADDITION WAS MADE BY T HE ASSESSING OFFICER IN THE ORIGINAL ASSESSMENT MADE IN THE CASE OF THE ASSESSEE FOR THE BLOCK PERIOD AND AS THE MATTER WAS RESTORED TO THE FILE OF THE ASSESSING OFFICER BY THE TRIBUNAL TO DECIDE THE SPE CIFIC ISSUES WITH SPECIFIC DIRECTION BY ITS APPELLATE ORDER, THESE AD DITIONS MADE BY THE ASSESSING OFFICER ON THE NEW ISSUE WHICH WAS NO T EVEN INVOLVED IN THE APPEAL FILED BEFORE THE TRIBUNAL, I N OUR OPINION, WAS BEYOND THE SCOPE OF SET ASIDE PROCEEDINGS AS RIGHTL Y HELD BY THE LEARNED CIT(A). THE ADDITION MADE BY THE ASSESSING OFFICER ON THIS ISSUE THUS, WAS FULLY JUSTIFIED IN DELETING THE SAM E. HIS IMPUGNED ORDER ON THIS ISSUE IS THEREFORE UPHELD DISMISSING THE GROUND NO.6 OF THE REVENUES APPEAL. 9.1 IN THE LIGHT OF VIEW TAKEN BY THE ITAT IN THE IR AFORESAID DECISION DATED 17.4.2009, WE DO NOT FIND ANY MISTAKE IN THE APPROA CH OF THE LD. CIT(A). DELETING A SIMILAR ADDITION IN THE INSTANT CASE. THEREFORE , GROUND NO. IV) IN THE APPEAL IS ALSO DISMISSED. 10. NO OTHER PLEA OR ARGUMENT WAS MADE BEFORE US . IT(SS)A NO.127/D/2007 37 11. IN RESULT, APPEAL IS DISMISSED. SD/- SD/- (C.L. SETHI) (A.N. PAHUJA) (JUDICIAL MEMBER) (ACCOUNTANT MEMBER) NS COPY OF THE ORDER FORWARDED TO :- 1. ASSTT. COMMISSIONER OF INCOME-TAX, CENTRAL CIRCL E-1, ROOM NO.322, E-2, ARA CENTRE, JHANDEWALAN, NEW DELHI. 2. M/S DYNAMIC UNIVERSAL LTD., 2/10, SHANTI NIKETAN , NEW DELHI. 3. CIT(A)-III, NEW DELHI 4. CIT CONCERNED. 5. DR, ITAT,C BENCH, NEW DELHI 6. GUARD FILE. BY ORDER, DEPUTY / ASSTT.REGISTRAR ITAT, DELHI ORDER PRONOUNCED IN OPEN COURT
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