Shri Ashish P.Patel, Ahmedabad V. The Dy.CIT., Cent.Circle-1(2), Ahmedabad

ITSSA 16/AHD/2007

• Counselvise Citation: [2010] 124 COUNSELVISE.COM (IT) 9520 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 2 month(s) 6 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 31-03-2010
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Next Hearing Date: 04-02-2010
• Assessment Year: misc
• Appeal Filed On: 25-01-2007
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: N S DAYAM
• Assessee Lawyers: P M MEHTA; S N SOPARKAR
• Keywords: Unexplained cash credit; Unexplained investment; Business expenditure; Search and seizure; Loose papers; Document seized; Opportunity of being heard; Corroborative evidences; Competent authority; Block assessment; Tax effect; Reason to believe; Documents seized; Revenue expenditure
• Section: 143(3); 131; 68; 69

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCH A AHMEDABAD BEFORE SHRI N.S.SAINI, ACCOUNTANT MEMBER AND SHRI MAHAVIR SINGH, JUDICIAL MEMBER IT(SS)A NO.16/AHD/2007 BLOCK PERIOD 1/4/85 TO 14/03/96 DATE OF HEARING:4.2.10 DRAFTED:3.3.10 SHRI ASHISH P PATEL, RADHE, 2, VITHAL PATEL COLONY, NR. SARDAR PATEL COLONY, AHMEDABAD PAN NO.ACTPP0045R V/S . DCIT, CENTRAL CIRCLE- 1(2), AHMEDABAD (APPELLANT) .. (RESPONDENT) APPELLANT BY :- SHRI S.N.SOPARKAR & SHRI P.M. MEHTA, AR RESPONDENT BY:- SHRI N.S.DAYAM, CIT-DR O R D E R PER MAHAVIR SINGH THIS APPEAL BY THE ASSESSEE IS ARISING OUT OF THE ORDER OF DY. COMMISSIONER OF INCOME-TAX, CENTRAL CIRCLE-1(2), AHMEDABAD U/S.1 58BC R.W.S. 143(3) R.W.S. 254 OF INCOME-TAX ACT, 1961 (HEREINAFTER REFERRED TO AS T HE ACT) VIDE HIS ORDER DATED 29-12- 2006 FOR THE BLOCK PERIOD FROM 01-04-1995 TO 14-03- 1996. 2. AT THE OUTSET LD. COUNSEL FOR THE ASSESSEE, SHRI S.N.SOPARKAR FAIRLY STATED, THAT HE HAS INSTRUCTIONS FROM THE ASSESSEE NOT TO P RESS GROUND NOS. 1 TO 5 AND STATED THAT THESE GROUNDS ARE MOSTLY GENERAL IN NAT URE. HENCE, THE ASSESSEE IS NOT INTERESTED IN PROSECUTING THESE GROUNDS I.E. GROUND NO.1-5. ACCORDINGLY, THE SAME ARE DISMISSED AS NOT PRESSED. 3. NOW COMING TO GROUND NO.6 LD. COUNSEL FOR THE ASSESSEE ALSO STATED THAT THE ASSESSEE IS NOT INTERESTED IN PROSECUTING GROUND NO.6.1, 6,2, 6.3, 6.4., 6.5., 6.6., 6.7., 6.8,. & 6.9. LD. COUNSEL FOR THE ASSESSEE STATED THAT THERE IS CLEAR INSTRUCTIONS IT(SS)A NO.16/AHD/2007 B.P. 1-4-85 TO 31-3-95 & 1-4-95 TO 14-3-96 ASHISH P PATEL V. DCIT, CC-1(2) ABD PAGE 2 FROM THE ASSESSEE, NOT TO PRESS THESE GROUNDS. ACCO RDINGLY, THE ABOVEMENTIONED GROUNDS ARE DISMISSED AS NOT PRESSED. 4. THE REMAINING GROUNDS, NOW WE WILL DEAL WITH I.E . GROUND NO.6.10 AND THE SAME IS AS UNDER:- 6. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE, INTER ALIA THE FOLLOWING ADDITIONS MADE IN THE RESPECTIVE PARAGRAPHS OF IMPU GNED ASSESSMENT ORDER DESERVES TO BE DELETED. (10. UNEXPLAINED CASH CREDITORS U/S.68 AS PER PARA 8-8.3 RS.1,95,22,670/-) 5. THE BRIEFLY STATED FACTS ARE THAT SEARCH AND SEI ZURE OPERATION U/S.132 OF THE ACT WAS CARRIED OUT AT THE BUSINESS AND RESIDENTIAL PREMISES OF THE ASSESSEE AT RADHE DEVELOPERS (INDIA) LTD (RDIL IN SHORT) OF THE ASSESSEE AT RADHE, 2 VITHALBHAI PATEL COLONY, NR. SARDAR PATEL COLONY, A HMEDABAD AND OTHER GROUP CONCERN OF THE ASSESSEE ON 14-03-1996. THE ASSESSEE IS MANAGING DIRECTOR OF RDIL ALONG WITH, PARTNER IN THE FOLLOWING FIRMS:- M/S. RADHE ESTATE DEVELOPERS M/S. RADHE ORGANISERS M/S. RADHE CONSTRUCTION CO. M/S. RADHE CONSULTANCY THE ASSESSEE IS ALSO PROPRIETOR OF M/S. RADHE FINAN CE AND M/S. RADHE ORGANIZERS. ORIGINAL BLOCK ASSESSMENT WAS COMPLETED BY THE ASSE SSING OFFICER ON 31-03-1997 BY MAKING VARIOUS ADDITIONS. DURING THE COURSE OF S EARCH AT THE RESIDENCE OF THE ASSESSEE, CASH AMOUNTING TO RS.3,69,240/- AND JEWEL LERY AND GOLD ORNAMENTS VALUING RS.41,28,594/-, WHICH INCLUDES THE JEWELLER Y WERE FOUND FROM LOCKER NO.613 OF BANK OF INDIA, VIJAY CHAR RASTA BRANCH, AND LOCK ER NO.112 BANK OF INDIA, SARDAR PATAL ROAD BRANCH, AHMEDABAD WAS FOUND. APART FROM THIS SILVER UTENSILS AND ORNAMENTS FOR AN AMOUNT OF RS.3,20,400/- WAS ALSO F OUND. JEWELLERY AND GOLD ORNAMENTS AMOUNTING TO RS.18,17,630/- WERE FOUND AP ART FROM THE ABOVE, FROM LOCKER NOS. 2181, 884 AND 2342 WITH BANK OF INDIA, NAVARANGAPURA BRANCH. OUT OF THESE ABOVE, SILVER UTENSILS AND ORNAMENTS AT RS.2, 66,400/- WAS SEIZED. THE SEARCH PARTY WAS FOUND SHARES, WHICH WERE INVENTORIED AS A NNEXURE-X TO PANCHNAMA DATED 15-03-1996 FOR RS.2,80,375/- AND HOUSEHOLD GOODS IN VENTORIED AS PER ANNEXURE-V OF IT(SS)A NO.16/AHD/2007 B.P. 1-4-85 TO 31-3-95 & 1-4-95 TO 14-3-96 ASHISH P PATEL V. DCIT, CC-1(2) ABD PAGE 3 PANCHNAMA. A NUMBER OF INCRIMINATING DOCUMENTS WERE FOUND AND SEIZED FROM ASSESSEES RESIDENCE AND THE SAME WERE INVENTORIZED AS ANNEXURE-A/1, A/2, AND A/3. BOOKS OF ACCOUNTS AND OTHER DOCUMENTS CONNECT ED WITH THE BUSINESS ACTIVITIES OF THE ASSESSEE WERE FOUND AND SEIZED FROM HIS GROU P CONCERNS. DURING SEARCH STATEMENTS U/S.132 OF THE ACT OF THE ASSESSEE WAS R ECORDED AND FURTHER SUBSEQUENT STATEMENTS U/S.131(1A) OF THE ACT WERE ALSO RECORDE D. THE ASSESSEE ON 01-05- 1996, DURING THE COURSE OF SEARCH, VIDE HIS STATEME NT ADMITTED THE CONCEALED INCOME OF RS.18.20 CRORE EARNED FROM VARIOUS UNITS IN HIS VARIOUS PROJECTS. IN THE LIGHT OF THE ABOVE FACTS, BLOCK ASSESSMENT WAS COMP LETED BY THE ASSESSING OFFICER AND THE SAME WERE CHALLENGED BEFORE ITAT. ITAT VID E ITS ORDER DATED 16-03-2005 IN HAS SET ASIDE THE BLOCK ASSESSMENT BY GIVING FOLLOW ING FINDING IN PARA-5 & 6 AS UNDER:- 5. WE HAVE CAREFULLY CONSIDERED THE ARGUMENTS OF B OTH THE PARTIES AND PERUSED THE MATERIAL PLACE BEFORE US. IT IS WELL SE TTLED LAW THAT ANY EVIDENCE COLLECTED BEHIND THE BACK OF THE ASSESSEE OR ANY ST ATEMENT RECORDED BEHIND THE BACK OF THE AS CANNOT BE UTILIZED AGAINST THE A SSESSEE UNLESS COPY OF SUCH EVIDENCE/STATEMENT IS SUPPLIED TO THE ASSESSEE AND HE IS GIVEN AN OPPORTUNITY TO REBUT THE SAME. IN THIS CASE, MOST O F THE ADDITIONS ARE BASED UPON THE LOOSE PAPERS. WHILE INTERPRETING SUCH LOOS E PAPERS I.E. WHETHER DIGIT MENTIONED IN THE LOOSE PAPERS REPRESENTS MILLION OR CRORE, THE REVENUE HAS RELIED UPON THE STATEMENT OF SHRI KALPESH THAKK AR. THE LEARNED COUNSEL MADE A STATEMENT AT BAR THAT THE COPY OF SUCH STATE MENT WAS NOT SUPPLIED TO THE ASSESSEE DESPITE SPECIFIC REQUEST WAS MADE BY T HE ASSESSEE IN THIS REGARD. THE LEARNED DEPARTMENTAL REPRESENTATIVE HAS NOT CONTROVERTED THE ABOVE CONTENTION OF THE LEARNED COUNSEL FOR THE ASS ESSEE. 6. IN VIEW OF THE ABOVE, WE DEEM IT PROPER TO SET A SIDE THE ORDER OF THE AUTHORITIES BELOW AND RESTORE THE MATTER BACK TO TH E FILE OF THE ASSESSING OFFICER. WE DIRECT HIM TO MAKE ASSESSMENT AFRESH AF TER FOLLOWING ADEQUATE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. IF THE ASSESSING OFFICER WANTS TO RELY UPON THE STATEMENT OF SHRI KALPESH THAKKAR, TH EN, HE SHOULD SUPPLY THE COPY OF THE STATEMENT OF SHRI KALPESH THAKKAR TO TH E AS AND ALSO ALLOW THE ASSESSEE AN OPPORTUNITY TO CROSS EXAMINE HIM, IF TH E ASSESSEE SO REQUESTS. THE A.O WILL ALSO EXAMINE WHETHER THE LAND AT LA. B UNGALOW BELONGS TO THE ASSESSEE OR TO GANGANAGAR CO-OP HOUSING SOCIETY. SI MILARLY, HE WILL ALSO EXAMINE THE ASSESSEES SUBMISSION WITH REGARD TO EA CH AND EVERY ADDITIONS AFTER CONSIDERING THE EXPLANATION OF THE AS IN THIS REGARD. 6. ON THE ABOVE ISSUE OF CASH CREDITS, THE ASSESSI NG OFFICER NOTED THE FACT WHILE RE-FRAMING THE SET ASIDE BLOCK ASSESSMENT, THAT A S IMULTANEOUS SEARCH WAS CONDUCTED ON 14-03-1996 IN THE CASE OF SHRI J.N. PA TEL, WHO IS ONE OF THE DIRECTORS OF RDIL, FROM WHOSE OFFICE PREMISES A LOOSE PAPER F ILE ANNEXURE-A/1 WAS SEIZED, IT(SS)A NO.16/AHD/2007 B.P. 1-4-85 TO 31-3-95 & 1-4-95 TO 14-3-96 ASHISH P PATEL V. DCIT, CC-1(2) ABD PAGE 4 WHICH CONTAINS RECEIPTS ISSUED BY M/S. RADHYA FINAN CE LTD. IN THE NAMES OF SHRI V.N. SHAH, FINLEASE LTD., SHAILESH H SANGHVI, MUKTI LAL KANTILAL VARIA AND OTHERS. DURING THE COURSE STATEMENT U/S.132(4) OF THE ACT, SHRI JAYANTI N PATEL WAS ASKED TO EXPLAIN ALL THE RECEIPTS, SEIZED PAGES 111 TO 121 I NVENTORIZED AS ANNEXURE-A/1, AS TO WHY ALL THE RECEIPTS ISSUED IN 3 RD PARTY NAME BY RADHE FINANCE LTD. WERE LYING IN HIS OFFICE. HE REPLIED VIDE Q. NO.13, THAT ONE OF HIS GROUP CONCERN M/S. ADITYA FINANCE HAS DEPOSITED RS.50,000/- WITH M/S. RADHE FINANCE L TD. AND WHILE COLLECTING THIS RECEIPT, THE RECEIPTS IN THE NAME OF 3 RD PERSONS HAVE COME TO HIM BY MISTAKE AND HE STATED THAT HE DOES NOT KNOW THE PERSONS IN WHOSE N AMES THESE RECEIPTS ARE. SUBSEQUENTLY, STATEMENT OF SHRI SHANTILAL MANILAL S HAH, KIRAN P SONI AND SHRI SHAILESH H SANGHVI WERE RECORDED U/S.131 OF THE ACT BY THE ADIT, UNIT 1(2), AHMEDABAD AND THESE PERSONS CATEGORICALLY ADMITTED THAT THEY HAVE RECEIVED THE AMOUNTS IN CASH FROM SHRI J.N. PATEL. THEY STATED THAT THE CASH AMOUNT WAS DEPOSITED BY THEM IN THEIR RESPECTIVE BANK ACCOUNTS AND CHEQUE AMOUNT, AS REFLECTED IN THOSE RECEIPTS, WERE ISSUED BY THEM ON INSTRUCTIONS FROM SHRI J.N. PATEL IN THE NAME OF RADHE FINANCE THE PROPRIETARY CONCER N OF THE ASSESSEE. THE ASSESSEE BEFORE THE ASSESSING OFFICER, (IT IS NOTED IN PARA-8.3 OF THE RE-FRAMED BLOCK ASSESSMENT ORDER) FILED COPIES OF ACCOUNTS OF VARIO US DEPOSITORS AND THE COPIES OF ACCOUNTS AS DULY CONFIRMED BY THE CONCERNED DEPOSIT ORS AND ALSO FILED COMPLETE ADDRESS OF THESE DEPOSITORS. ACCORDING TO THE ASSES SING OFFICER, THE STATEMENT OF THESE PERSONS CLEARLY ESTABLISHED, THAT THESE CASH CREDITS ARE UNEXPLAINED INCOME OF THE ASSESSEE IN TERMS OF PROVISION OF SEC. 68 OF TH E ACT AND ADDED AS UNDISCLOSED INCOME FOR THE BLOCK PERIOD, WHILE RE-FRAMING SET A SIDE BLOCK ASSESSMENT AMOUNTING TO RS.1,95,22,670/- IN ASSESSMENT YEAR 1996-97 (FAL LING IN THE SAME BLOCK). THIS AMOUNT IS BIFURCATED AS AN AMOUNT OF RS.1,90,41,605 /- THROUGH RADHE FINANCE AND RS.4,81,941/- THROUGH RADHE ORGANIZERS. AGGRIEVED A GAINST THE ACTION OF THE ASSESSING OFFICER, THE ASSESSEE PREFERRED APPEAL BE FORE US (BEING FIRST APPELLATE AUTHORITY IN SEARCH CONDUCTED ON OR BEFORE 31-12-19 96 AND THE SEARCH WAS CONDUCTED AS ON 14-03-1996). 7. BEFORE US THE LD. COUNSEL FOR THE ASSESSEE FIRST OF ALL TAKEN US TO THE FACTS OF THE CASE AND STATED THAT THE COMPLETE BREAK-UP OF C ASH CREDITS TAXED U/S.68 OF THE ACT IS ENCLOSED IN THE ASSESSEES PAPER BOOK AT PAG ES 19 TO 26 AND ALSO DRAWN OUR ATTENTION TO THE CONFIRMATIONS FILED WITH THE ASSES SING OFFICER REGARDING UNEXPLAINED IT(SS)A NO.16/AHD/2007 B.P. 1-4-85 TO 31-3-95 & 1-4-95 TO 14-3-96 ASHISH P PATEL V. DCIT, CC-1(2) ABD PAGE 5 CASH CREDITS ADDED BY THE AO TO THE UNDISCLOSED INC OME OF THE ASSESSEE WHILE COMPLETING BLOCK ASSESSMENT IN SECOND ROUND. THE R ELEVANT CONFIRMATIONS ARE ENCLOSED AT ASSESSEES PAPER BOOK AT PAGES 31 TO 20 1. THE LD. COUNSEL FOR THE ASSESSEE STATED THAT LOOSE PAPER FILED ANNEXURE-A/1 WAS SEIZED FROM THE RESIDENCE OF SHRI J.N. PATEL, CONSISTING OF PAGES 111 TO 121, ARE RECEIPT ISSUED BY RADHE FINANCE IN NAME OF V.N. SHAH, FINLEASH LIMITED, SHA LISH N SANGHVI AND OTHER PERSONS. HE STATED THAT IN THE STATEMENT RECORDED, S.M.SHAH, K.P. SONI AND S.H. SANGHVI SAID THEY RECEIVED CASH FROM SHRI J.N. PATE L WHICH WAS DEPOSITED BY THEM IN THEIR BANK ACCOUNTS AND CHEQUES AMOUNTS REFLECTE D IN RECEIPTS ISSUED BY SHRI S.M. SHAH, SHRI K.P. SONI AND SHRI S.H. SANGHVI ON INSTRUCTION OF J.N. PATEL IN NAME OF RADHE FINANCE AND CHEQUES WERE GIVEN TO SHRI J.N . PATEL AS MONEY BELONGING TO HIM. THE LD. COUNSEL FOR THE ASSESSEE STATED THAT T HE AO AT THE TIME OF ORIGINAL BLOCK ASSESSMENT PROCEEDINGS HAD STATED THAT ASSESSEE HAD NOT SUBMITTED THE CONFIRMATION ACCOUNTS FROM ALL THE CREDITORS APPEAR ING IN THE BOOKS OF ACCOUNT HENCE AMOUNT RECEIVED THROUGH SHRI J.N PATEL WILL BE ADDE D AS UNEXPLAINED CASH CREDIT U/S.68 OF THE ACT. THE LD. COUNSEL FOR THE ASSESSEE FURTHER STATED THAT CASH IS PAID BY SHRI J.N. PATEL TO SOME OTHERS WHO DEPOSITED IN THE IR BANK ACCOUNT AND WHO IN TURN GAVE CHEQUES FOR DEPOSITS IN RADHE GROUP AND ACCORD INGLY, ADDITION, IF ANY, CAN BE MADE ONLY IN CASE OF SHRI J.N. PATEL AND NOT IN CAS E OF ASSESSEE AS CASH HAS BEEN PAID BY SHRI J.N. PATEL AND NOT BY ASSESSEE. HE ST ATED THAT AO HAS MADE AN ADDITION ON THE GROUND THAT, AS ASSESSEE HAS NOT FU RNISHED CONFIRMATION ACCOUNTS FROM ALL THE CREDITORS APPEARING IN HIS BOOKS OF AC COUNT AND THE AMOUNT RECEIVED BY HIM THROUGH SHRI J.N. PATEL WILL BE ADDED IN THE IN COME BEING UNEXPLAINED CASH CREDITS IN TERMS OF PROVISIONS OF SECTION 68 OF THE ACT. HE FURTHER STATED THAT THE ASSESSEE SUBMITTED CONFORMATION ACCOUNTS ALONG WITH ADDRESS, PAN NO. FROM ALL THE CREDITORS BEFORE THE ASSESSING OFFICER DURING THE C OURSE OF RE-RE-FRAMING OF SET ASIDE BLOCK ASSESSMENT. HE FURTHER STATED THAT AFORESAID AMOUNTS HAVE BEEN RECEIVED BY ACCOUNT PAYEE CHEQUES ONLY. IN VIEW OF SAID FACTS, LD. COUNSEL FOR THE ASSESSEE STATED THAT THE ASSESSEE HAS DISCHARGED ITS BURDEN BY PROVIDING COGENT EVIDENCES AS STATED ABOVE AND IF THE AO WAS NOT SATISFIED WIT H THE CASH AMOUNT DEPOSITED BY THOSE DEPOSITORS IN THEIR BANK ACCOUNTS, THE PROPER COURSE WOULD HAVE BEEN TO MAKE ASSESSMENTS IN THE CASES OF THOSE DEPOSITORS BY TRE ATING THE CASH DEPOSITS IN THEIR BANK ACCOUNTS AS UNEXPLAINED INVESTMENTS OF THOSE D EPOSITORS SEC, 69 OF THE ACT. IT(SS)A NO.16/AHD/2007 B.P. 1-4-85 TO 31-3-95 & 1-4-95 TO 14-3-96 ASHISH P PATEL V. DCIT, CC-1(2) ABD PAGE 6 8. ON THE OTHER HAND, THE LD. CIT-DR, SHRI N.S. DHA YAM STATED MERELY FILING OF CONFIRMATIONS LETTERS AND ADDRESSES OF THE DEPOSITO RS WILL NOT PROVE THE CASH CREDIT IN TERMS OF SEC.68 OF THE ACT. HE STATED THAT THESE C ASH CREDITS WERE FOUND BY THE DEPARTMENT AFTER SEARCH AND SEIZURE OPERATION AND D URING THE SEARCH PAGES 111 TO 121 ARE THE RECEIPTS ISSUED BY M/S. RADHE FINANCE L TD. IN THE NAMES OF ABOVEMENTIONED PERSONS. HE STATED THAT THE ASSESSEE WAS REQUIRED TO PROVE IDENTITY, CAPACITY OF THE DEPOSITORS AS ALSO THE GE NUINENESS OF THE TRANSACTION. HE STATED THAT THE ASSESSEE HAS FILED REPLY DATED 23-1 1-2006 ENCLOSING THEREWITH COPY OF ACCOUNTS OF THE VARIOUS DEPOSITORS AND IN HIS PL EA, THE ASSESSEE HAD STATED THAT THE COPIES OF ACCOUNTS ARE DULY CONFIRMED BY THE CO NCERNED DEPOSITORS AND HENCE BURDEN IN THIS REGARD IS DISCHARGED. ACCORDING TO L D. CIT-DR, THE PLEA OF THE ASSESSEE IS NOT ACCEPTABLE BECAUSE THREE BASIC INGR EDIENTS AS MENTIONED ABOVE ARE REQUIRED TO BE CONCLUSIVELY PROVED BY THE ASSESSEE IN RESPECT OF EACH AND EVERY CASH CREDITS APPEARING IN THE BOOKS OF ACCOUNT. AC CORDINGLY, THE LD. CIT-DR URGED THE BENCH TO CONFIRM THE ADDITION. 9. WE HAVE HEARD THE RIVAL CONTENTIONS AND GONE THR OUGH THE FACTS AND CIRCUMSTANCES OF THE CASE. AFTER GOING THROUGH THE DOCUMENTS FILED BY THE ASSESSEE IN HIS PAPER BOOK, WHERE COMPLETE BREAK-UP OF CASH CREDITS TAXED U/S.68 OF THE ACT IS ENCLOSED AT PAGES 19 TO 26 AND ALSO THE CONFIRMATIO NS FILED WITH THE ASSESSING OFFICER REGARDING UNEXPLAINED CASH CREDITS ADDED BY THE AO TO THE UNDISCLOSED INCOME OF THE ASSESSEE WHILE COMPLETING BLOCK ASSES SMENT IN SECOND ROUND. THE RELEVANT CONFIRMATIONS ARE ENCLOSED AT ASSESSEES P APER BOOK AT PAGES 31 TO 201. WE FIND FROM THE FACTS OF THE CASE THAT LOOSE PAPER FILE ANNEXURE-A/1 WAS SEIZED FROM THE RESIDENCE OF ASSESSEE, CONSISTING OF PAGES 111 TO 121, ARE RECEIPT ISSUED BY RADHE FINANCE IN NAME OF V.N. SHAH, FINLEASH LIM ITED, SHALISH N SANGHVI AND OTHER PERSONS. WE FIND FROM THE STATEMENT RECORDED OF SHRI S.M.SHAH, SHRI K.P. SONI AND SHRI S.H. SANGHVI THAT THEY HAVE RECEIVED CASH FROM SHRI J.N. PATEL, WHICH WAS DEPOSITED BY THEM IN THEIR BANK ACCOUNTS, AND CHEQU E AMOUNTS REFLECTED IN RECEIPTS ISSUED BY SHRI S.M. SHAH, SHRI K.P. SONI AND SHRI S .H. SANHVI, ON INSTRUCTIONS OF J.N. PATEL IN NAME OF RADHE FINANCE AND CHEQUES WER E GIVEN TO SHRI J.N. PATEL AS MONEY BELONGING TO HIM. WE FURTHER FIND THAT CASH I S PAID BY SHRI J.N. PATEL TO THESE PERSONS, WHO DEPOSITED IN THEIR BANK ACCOUNT AND WH O IN TURN GAVE CHEQUES FOR DEPOSITS IN RADHE GROUP. WE FIND THAT IN THE FIRST ROUND OF BLOCK ASSESSMENT THE AO IT(SS)A NO.16/AHD/2007 B.P. 1-4-85 TO 31-3-95 & 1-4-95 TO 14-3-96 ASHISH P PATEL V. DCIT, CC-1(2) ABD PAGE 7 HAS MADE AN ADDITION ON THE GROUND THAT AS ASSESSEE HAS NOT FURNISHED CONFIRMATION ACCOUNTS FROM ALL THE CREDITORS APPEARING IN HIS BO OKS OF ACCOUNT BUT IN SECOND ROUND ALSO DESPITE THE FACT THAT THESE DETAILS WERE BEFOR E THE ASSESSING OFFICER DURING THE COURSE OF BLOCK ASSESSMENT PROCEEDINGS IN THE SECON D ROUND BUT HE HAS NOT TAKEN ANY ACTION TO CALL FOR THESE CREDITORS AND EXAMINE THEM. WE FURTHER FIND, THAT THE ASSESSEE SUBMITTED CONFORMATION OF ACCOUNTS ALONG W ITH ADDRESS, PAN NO. FROM ALL THE CREDITORS BEFORE THE ASSESSING OFFICER DURING T HE COURSE OF RE-FRAMING OF SET ASIDE BLOCK ASSESSMENT AND AFORESAID AMOUNTS HAVE B EEN RECEIVED BY ACCOUNT PAYEE CHEQUES ONLY. IN VIEW OF SAID FACTS, WE ARE O F THE VIEW THAT THIS ISSUE IS SQUARELY COVERED IN FAVOUR OF THE ASSESSEE AND AGAI NST THE REVENUE BY THE DECISION OF HONBLE GUJARAT HIGH COURT IN THE CASE OF DCIT V.ROHINI BUILDERS (2002) 256 ITR 360 (GUJ), WHEREIN THE HON'BLE COURT FOLLOWING THE CASE LAW OF HONBLE SUPREME COURT IN THE CASE OF CIT V. ORISSA CORPORATION P LTD. (1986) 159 ITR 78 (SC), HAS HELD THAT THE TRIBUNAL HAS RECORDED A FINDING OF FA CT THAT THE ASSESSEE HAD DISCHARGED THE INITIAL ONUS WHICH LAY ON IT IN TERM S OF SECTION 68 BY PROVING THE IDENTITY OF THE CREDITORS BY GIVING THEIR COMPLETE ADDRESSES, GIR NUMBERS / PERMANENT ACCOUNT NUMBERS AND THE COPIES OF ASSESSM ENT ORDERS WHEREVER READILY AVAILABLE, THAT IT HAD ALSO PROVED THE CAPACITY OF THE CREDITORS BY SHOWING THAT THE AMOUNTS WERE RECEIVED BY THE ASSESSEE BY ACCOUNT PA YEE CHEQUES DRAWN FROM BANK ACCOUNTS OF THE CREDITORS AND THE ASSESSEE WAS NOT EXPECTED TO PROVE THE GENUINENESS OF THE CASH DEPOSITED IN THE BANK ACCOU NTS OF THOSE CREDITORS BECAUSE UNDER LAW THE ASSESSEE CAN BE ASKED TO PROVE THE SO URCE OF THE CREDITS IN ITS BOOKS OF ACCOUNT BUT NOT THE SOURCE OF THE SOURCE. THUS, TAKING INTO CONSIDERATION THE TOTALITY OF THE FACTS AND CIRCUMSTANCES OF THE CASE AND PARTICULARLY THE FACT THAT THE ASSESSING OFFICER HAD NOT EXAMINED THE CASH CREDITO RS DESPITE THE REMAND BY THE TRIBUNAL FOR SECOND ROUND, WHEN THE PAN NOS., ADDRE SSES ETC., WERE AVAILABLE WITH THE ASSESSING OFFICER. ACCORDINGLY, WE ARE OF THE VIEW THAT THE ASSESSEE HAD DISCHARGED THE INITIAL ONUS CASTE ON HIM. ACCORDIN GLY, WE ALLOW THIS ISSUE OF THE ASSESSEES APPEAL. 10. THE NEXT COMMON ISSUES IN THIS APPEAL OF ASSES SEE IS RAISED BY WAY OF GROUND NO.6.11 TO 6.20 AS UNDER:- IT(SS)A NO.16/AHD/2007 B.P. 1-4-85 TO 31-3-95 & 1-4-95 TO 14-3-96 ASHISH P PATEL V. DCIT, CC-1(2) ABD PAGE 8 6.11 UNEXPLAINED INVESTMENT IN LAND AS PER PARA 9. 3.1 250,00,000 6.12 UNEXPLAINED LOAN GIVEN TO NTC AS PER PARA 9.3 .2 320,00,000 6.13 UNEXPLAINED INVESTMENTS IN FLATS/OFFICE AS PE R PARA 9.3.4 200,00,000 6.14 UNEXPLAINED INVESTMENTS IN CHEKHLA LAND AS PER PARA 9.3.5 200,0 0,000 6.15 UNEXPLAINED INVESTMENT IN LAND NEAR OLD L.Y COLLEGE AS PER PARA 9.3.6 150,00,000 6.16 UNEXPLAINED INVESTMENT IN LAND NEAR THIRATHDH AM AS PER PARA 9.3.7 250,00,000 6.17. UNEXPLAINED INVESTMENT IN MAKARBA LAND AS PER PARA 9.3.8 100,00,000 6.18 UNEXPLAINED INVESTMENT IN PLOT BEHIND K.H. MODI SCHOOL AS PER PARA 9.3.10 233,00,000 6.19 UNEXPLAINED INVESTMENT IN KOTESHWAR LAND AS PER PARA 9.3.11 11,61,00,000 6.20 UNEXPLAINED INVESTMENT IN LAND NEAR MAHADEVNAGAR AS PER PARA 9.3.12 250,00,000 11. THE BRIEF FACTS RELATING TO THE ABOVE COMMON IS SUES ARE THAT DURING THE COURSE OF SEARCH, A LOOSE PAPER FILE INVENTORIED AS ANNEXU RE-A/1 CONTAINING PAGES 1 TO 27 WAS FOUND AND SEIZED FROM THE RESIDENCE OF THE ASSE SSEE. ACCORDING TO THE ASSESSING OFFICER THESE PAGES CONTAINED ONE FILE RE VEALS A PARALLEL BALANCE-SHEET OF THE FINANCIAL AFFAIRS OF THE ASSESSEE. ACCORDING T O THE AO, ON PAGE NO.1 OF THIS FILE A BALANCE-SHEET HAS BEEN DRAWN REFLECTING INCOME AND INVESTMENT AND IN THE RIGHT HAND SIDE CODE NOS. OF VARIOUS LANDS, LOCATION OF T HE LAND AND OTHER INVESTMENTS HAVE BEEN MENTIONED. ON THE LEFT HAND SIDE, NAMES O F VARIOUS PERSONS ARE MENTIONED. ON PAGE 18 THERE ARE ENTRIES OF THIS AN NEXURE. DURING THE COURSE OF SEARCH, THE STATEMENT OF ASSESSEE WAS RECORDED ON 1 4-03-1996 AND EXPLANATIONS OF THESE DOCUMENTS WERE CALLED FOR. THE RELEVANT QUEST ION & ANSWER ARE REPRODUCED IN THE REFRAMED SET ASIDE BLOCK ASSESSMENT ORDER. THE AO IN THE SECOND ROUND ALSO CONFIRMED THE SAME ADDITIONS BY DECODING THE ENTRIE S AS UNDER:- 9.1 DURING THE ORIGINAL ASSESSMENT PROCEEDINGS, TH E ASSESSEE WAS ASKED TO EXPLAIN THE CONTENTS OF THE PAGE 1 OF ANNEXURE A-1, VIDE QUESTIONNAIRE DTD. 16.12.1996. IN RESPONSE THERETO, THE ASSESSEE HAS F ILED A REPLY DTD. 15.2.1997 AND CLAIMED THAT THE FIGURES NOTED ON THIS PAGE WER E PROJECTIONS OF FUTURE TRANSACTION IN RESPECT OF THE VARIOUS PROJECTS IN C ONSIDERATION. HE HAS FURTHER CLAIMED THAT THE SAID PAGE WAS PREPARED FOR PROJECT IONS ONLY AND NO TRANSACTIONS HAD TAKEN PLACE ACTUALLY. THE HONBLE ITAT HAS SET ASIDE THE ASSESSMENT WITH CERTAIN DIRECTIONS REPRODUCED IN PA RA 2 OF THIS ORDER. IN ORDER TO COMPLY WITH THE DIRECTIONS OF HONBLE ITAT AND T O COMPLETE THE SET ASIDE ASSESSMENT PROCEEDINGS, THE ASSESSEE WAS AGAIN REQU IRED TO EXPLAIN THE IT(SS)A NO.16/AHD/2007 B.P. 1-4-85 TO 31-3-95 & 1-4-95 TO 14-3-96 ASHISH P PATEL V. DCIT, CC-1(2) ABD PAGE 9 ENTRIES ON PAGE 1 OF ANNEXURE A-1, WITH SUPPORTING EVIDENCE. HE WAS ALSO REQUIRED TO EXPLAIN AS TO WHY THE ENTRIES ON THE SA ID PAGE BE NOT CONSIDERED AS ACTUAL TRANSACTIONS THAT TOO IN CRORES. IN RESPO NSE TO THE NOTICES, THE ASSESSEE HAS FILED TWO REPLIES DTD. 28-22-06. IN BO TH THESE REPLIES, THE ASSESSEE HAS AGAIN CLAIMED THAT THE NOTINGS ON PAG E 1 OF THE ANNEXURE A-1 ARE THE FIGURES FOR FUTURE PROJECTIONS WHICH HE HAD EXPECTED TO RECEIVE IN RESPECT OF CERTAIN TRANSACTIONS. THE ASSESSEE HAD A LSO SUBMITTED THAT THE HONBNLE ITAT IN THE CASE OF RADHE DEVELOPERS (INDI A) LTD. VIDE ITS ORDER 15- 1-1999 CONTAINED IN IT(SS)A NO.103/AHD/1997 HAS CAT EGORICALLY HELD THAT THE AMOUNTS ON THE SAID SEIZED PAPERS WERE FUTURE PROJE CTIONS ONLY AND COULD NOT BE TREATED AS ACTUAL TRANSACTIONS. ACCORDINGLY, THE HONBLE ITAT HAS DELETED THE ADDITION IN THE CASE OF RADHE DEVELOPERS (INDIA ) LTD. BASED ON THREE ENTRIES OF THE SAID PAGE NO.1. THE ASSESSEE HAS ALS O FURNISHED REPLY IN RESPECT OF EACH AND EVERY ENTRY WHICH IS BEING DISC USSED SUBSEQUENTLY WHILE CONSIDERING THE ADDITIONS ON THE BASIS OF ENTRIES I N THE SEIZED DOCUMENT. 9.2 DE-CODING OF ENTRIES IN ORDER TO APPRECIATE DE-CODING OF THE ENTRIES, T HE ENTRIES RECORDED ON SEIZED PAPER 1, WHICH ARE BEING CONSIDERED HERE IN THIS OR DER, ARE REPRODUCED AS UNDER:- ANNEXURE A-1 PAGE-1 LEFT HAND SIDE RIGHT HAND SIDE LT 3.00 111 2.50 -- -- 148 -- JNP .75 MANOJ 1.50 -- -- ETC. 2.00 -- -- CHEKHLA 2.00 -- -- 1742 NET 1.5 -- -- 4800 (21) 2.50 -- -- SHIKHAR 0.7 -- -- MAKARBA 1.00 ANNEXURE A-1 PAGE-18 LEFT HAND SIDE RIGHT HAND SIDE -- 162 2.33 -- 82 2.50 -- 387 22.61 A) MATCHING WITH ASSESSEES OWN ACCOUNT SIMILAR NOTINGS HAD ALSO BEEN MADE BY THE ASSESSEE ON PAGE 21 OF ANNEXURE A-1, WHEREIN BESIDES OTHER ENTRIES, THERE IS ONE ENTRY GA 5.00. DURING THE COURSE OF SEARCH AND SEIZURE OPERATIONS, GA HAS BEEN DECODED BY THE ASSESSEE HIMSELF AS GAUTAM ADANI TO WHOM RS.5 C RORES WERE PAID FOR HIS INTEREST IN VARIOUS LANDS (REFER Q.NO.20 STATEMENT DTD 5-3-96 AND Q.NO.5 STATEMENT DATED 15-4-96). THIS FIGURE ALSO FINDS PL ACE AT PAGE NO.103 OF IT(SS)A NO.16/AHD/2007 B.P. 1-4-85 TO 31-3-95 & 1-4-95 TO 14-3-96 ASHISH P PATEL V. DCIT, CC-1(2) ABD PAGE 10 ANNEXURE A-3, SEIZED FROM THE RESIDENCE OF THE ARUN B SHAH, LAW OFFICER OF THIS GROUP. THE SAID DOCUMENT ALONG WITH PAGE NO.10 6 OF ANNEXURE A-3 HAVE BEEN CONSIDERED IN THE CASE OF RADHE DEVELOPERS (IN DIA) LTD. WHILE COMPUTING THE UNDISCLOSED INCOME OF THE ASSESSEE CO MPANY. THE HONBLE ITAT HAS ALSO CONFIRMED THE ADDITIONS BASES ON SUCH ENTRIES IN RESPECT OF THE INVESTMENTS MADE IN SHANTINAGAR SHELA CO-OP. HOUSIN G SOCIETY FOR PURCHASE AND DEVELOPMENT OF THE SHELA LAND VIDE ITS ORDER DT D. 15.1.1999 (PAGE 5, RS.5.60 CRORES PAID TO GAUTAM ADANIO ARE CONSIDERED ). THEREFORE, IT IS ESTABLISHED THAT THE ASSESSEE HAS WRITTEN ENTRIES O N VARIOUS PAGES IN ANNEXURE A-1 INCLUDING PAGE 1 AND 21 IN CRORES. FUR THER FROM THE ENTRIES LIKE 2.33, 11.61 ETC. AND THE STATEMENT OF THE ASSESSEE, IT IS CLEAR THAT THE ENTRIES ARE NOT PROJECTIONS. B) SEARCH AND SEIZURE OPERATION IN THE CASE OF SHRI JAYANTI N PATEL. SEARCH AND SEIZURE OPERATION IN THE CASE OF SHRI JA YANTI N PATEL, ONE OF THE DIRECTORS OF RADHE DEVELOPERS (INDIA) LTD. WAS CARR IED OUT SIMULTANEOUSLY ON 14.3.1996. VARIOUS DOCUMENTS WERE SEIZED FROM THE R ESIDENCE OF SHRI J.N.PATEL, WHICH INCLUDE A LOOSE PAPER FILE ANNEXUR E A-1 (PAGES 1 TO 49) CONTAINING DETAILS OF UNACCOUNTED ADVANCE/LOAN GIVE N BY HIM TO DIFFERENT PERSONS IN CASH. THE CONTENTS OF THESE PAPERS AND T HE AMOUNTS ALSO TALLY WITH THE AMOUNTS EXISTING IN THE NAMES OF VARIOUS PERSON S, WHOSE ACCOUNTS HAVE BEEN MAINTAINED IN HIS SMALL DIARIES SEIZED FROM HI S RESIDENCE AND INVENTORIZED AS ANNEXURE A-2 TO A-6. ACCOUNT OF SHR I ASHISH PATEL, THE ASSESSEE, IS REFLECTED ON PAGES 71 & 109 OF ANNEXUR E A-3 SEIZED FROM THE RESIDENCE OF SHRI J.N. PATEL WHICH CONTAINED THE DE TAILS OF MONEY ADVANCED BY HIM TO SHRI ASHISH PATEL IN CASH ON VARIOUS DATE S. CONTENTS OF BOTH THE PAGES ARE AS UNDER:- PAGE 71- LEDGER ACCOUNT OF ASHISHBHAI BALANCE AS ON 4.1.1995 RS.89000)00 ON PAGE 109- ACCOUNT OF ASHISHBHAI 4.1.1996 RS.89000)00 10.2.1996 CR. RS.15000)00 RS.74000)00 1.3.1996 DR. RS. 1000)00 RS.75000)00 APART FROM THE ABOVE ENTRIES, ANOTHER LOOSE PAPER F ILE WHICH IS SEIZED FROM THE OFFICE PREMISES OF RADHE DEVELOPERS (INDIA) LTD. AL SO CONTAINS THE SIMILAR ENTRIES, WHICH ARE AS UNDER:- PATE 90 OF ANNEXURE A-32 JAYANTIBHAI SHROFF TOTAL 89,00,000 -FLAT 15,00,000 BALANCE 74,00,000 ======= FEB. SUDHINO A/C. IT(SS)A NO.16/AHD/2007 B.P. 1-4-85 TO 31-3-95 & 1-4-95 TO 14-3-96 ASHISH P PATEL V. DCIT, CC-1(2) ABD PAGE 11 IN RESPECT OF THE CONTENTS ON ABOVE PAGE, THE STATE MENT OF THE ASSESSEE WAS RECORDED ON 18.4.1996 AND IN RESPONSE TO Q.NO.19 OF HIS STATEMENT, HE HAS EXPLAINED THAT AS PER THE NOTINGS ON AFORESAID PAGE , A DEPOSIT OF RS.89 LACS FROM SHRI JAYANTI NN PATEL WAS WITH HIM. A SUM OF R S.15 LACS IS ADJUSTED AGAINST A FLAT OF 355 SQ.YDS. IN HIS TIRATHDHAM SCH EME. THUS, THE BALANCE UPTO FEBRUARY 1996 COMES TO RS.74 LACS. FROM THE ST ATEMENT OF THE ASSESSEE AS WELL AS ENTRIES RECORDED ON ABOVE PAGES, IT IS C LEAR THAT THE ASSESSEE HAD TAKEN A LOAN FROM SHRI J.N. PATEL AND BALANCE OF SU CH LOAN IN THE MONTH OF FEBRUARY WAS RS.74 LACS, WHICH AFTER GETTING ANOTHE R SUM OF RS.1 LAC ON 1.3.1996, THE LOAN AMOUNT BECAME RS.75 LACS. THIS L OAN AMOUNT OF RS.75 LACS IS SHOWN BY THE ASSESSEE AS NJP.75 ON PAGE 1 OF ANNEXURE A-1 SEIZED FROM HIS RESIDENCE. THUS, IT IS ESTABLISHED THAT TH E FIGURES ON PAGE 1 OF ANNEXURE A-1 ARE IN CRORES. IT IS ALSO RELEVANT TO POINT OUT THAT ON PAGE 90 OF ANNEXRE A-32, SEIZED FROM THE OFFICE PREMISES OF RADHE DEVELOPERS (INDIA) LTD . OTHER NAMES AND FIGURES MENTIONED ON PAGE 1 OF ANNEXURE A-1 SEIZED FROM THE ASSESSEES RESIDENCE ARE ALSO APPEARING. SOME OF THE EXAMPLES ARE CHELK HA, BALAJIPRA, MAKARBA, MANOJ, LOAN, ETC. THIS PROVES THAT TH ERE IS A STRONG CO-RELATION BETWEEN TWO SEIZED DOCUMENTS. C) SEARCH & SEIZURE OPEATION IN THE CASE OF L.T.SHR OFF GROUP. DURING THE COURSE OF SEARCH AND SEIZURE OPERATION I N THE CASE OF L.T. SHROFF GROUP ON 1.8.1996, STATEMENT OF SHRI KALPESH THAKKA R WAS RECORDED ON 3.8.1996, WHEREIN HE WAS QUESTIONED ABOUT CASH DEPO SITS MADE TO SHRI ASHISH P. PATEL BY L.T. SHROFF GROUP. IN RESPONSE T O THE Q.NO.9, HE HAD STATED THAT ABOUT RS.3 CRORES WERE OUTSTANDING IN T HE NAME OF SHRI ASHISH P PATEL. DURING THE COURSE OF ORIGINAL ASSESSMENT PRO CEEDINGS, THE ASSESSEE HAS NEITHER REQUESTED FOR THE STATEMENT OF SHRI KAL PESH THAKKAR NOR FOR HIS CROSS EXAMINATION. HOWEVER, THE HONNBLE ITAT WHILE SETTING ASIDE THE ASSESSMENT ORDER HAS DIRECTED TO SUPPLY THE COPY OF STATEMENT TO THE ASSESSEE AND ALLOW CROSS EXAMINATION, IF THE ASSESS EE SO DESIRES. EFFORTS HAVE BEEN MADE TO LOCATE SHRI KALPESH THAKKAR OF L. T.SHROFF GROUP, BUT ON ENQUIRY BY THE ITI, IT IS FOUND THAT SHRI KALPESH T HAKKAR HAS CLOSED DOWN HIS BUSINESS IN AHMEDABAD AND LEFT TO SOME UNKNOWN PLAC E. UNDER THESE CIRCUMSTANCES, CROSS EXAMINATION OF SHRI KALPESH TH AKKAR COULD NOT BE ALLOWED AS IT WAS NOT POSSIBLE AT THIS STAGE. IF, T HE ASSESSEE WAS INTERESTED, HE SHOULD HAVE ASKED FOR CROSS EXAMINATION DURING T HE COURSE OF ORIGINAL ASSESSMENT PROCEEDINGS. MOREOVER, FOR WANT OF CROSS EXAMINATION, THE STATEMENT OF SHRI KALPESH THAKKAR DOES NOT LOOSE IT S EVIDENTIARY VALUE PARTICULARLY WHEN OTHER CORROBORATIVE EVIDENCES ARE AVAILABLE ON RECORD. IT IS REITERATED THAT ENTRIES RECORDED ON THE SEIZED DOCU MENTS FROM THE RESIDENTIAL PREMISES OF THE ASSESSEE AS WELL AS SHRI JAYANTI N PATEL DISCUSSED ABOVE AT (A) & (B) CLEARLY ESTABLISH THAT THE ENTRIES RECORD ED ON PAGE 1 OF THE ANNEXURE A-1 WERE IN CRORES. D) EFFECT OF ORDER OF HONBLE ITAT. IT(SS)A NO.16/AHD/2007 B.P. 1-4-85 TO 31-3-95 & 1-4-95 TO 14-3-96 ASHISH P PATEL V. DCIT, CC-1(2) ABD PAGE 12 WHILE DELETING THE ADDITIONS IN THE CASE OF RADHE D EVELOPERS (INDIA) LTD. HONBLE ITAT HAS NOT CONSIDERED THE ABOVE MENTIONED REASONS AND ENTRIES IN THE BOOKS OF ACCOUNT OF SH. J.N. PATEL WHICH EXACTL Y MATCH WITH THE ENTRIES ON THE SEIZED PAPERS. MOREOVER, THE SAID DECISION IS N OT ACCEPTED BY THE DEPARTMENT AS THE REFERENCE TO HONBLE HIGH COURT H AS BEEN FILED. THEREFORE, THE RELIANCE OF ASSESSEE ON THE SAID DECISION IS NO T ACCEPTABLE. THE ASSESSING OFFICER IN VIEW OF THE ABOVE OBSERVAT IONS, REPEATED THE SAME ADDITIONS SIMPLY ON THE BASIS OF ORIGINAL BLOCK ASS ESSMENT ORDER. AGGRIEVED, THE ASSESSEE CAME IN APPEAL BEFORE. 12. BEFORE US THE LD. COUNSEL FOR THE ASSESSEE, SHR I SOPARKAR TAKEN US TO PAGE NO.1, 18 AND 71 OF ANNEXURE-A/1 SEIZED DURING THE C OURSE OF SEARCH. HE STATED THAT THIS ISSUE IS SQUARELY COVERED IN FAVOUR OF THE ASS ESSEE AND AGAINST THE REVENUE BY THE DECISION OF HONBLE ITAT IN THE CASE OF RADHE DEVELOPERS (INDIA) LTD. VIDE ITS ORDER DATED 15-01-1999 IN IT(SS)A NO.103/AHD/1997 , IN THE SISTER/GROUP CONCERN, WHERE THE SAME PAGES NO.1, 18 & 71 OF ANNEXURE-A/1 WAS SUBJECT-MATTER OF INTERPRETATION, WHEREIN IT IS HELD THAT THE AMOUNTS ON THE SEIZED PAPERS WERE FUTURE PROJECTIONS ONLY AND COULD NOT BE TREATED AS ACTUAL TRANSACTIONS AND THE TRIBUNAL HAS DELETED THE ADDITION. HE FURTHER STATED THAT THE FI NDINGS OF THE TRIBUNAL WAS CONFIRMED BY HONBLE JURISDICTION HIGH COURT IN TAX APPEAL NO.171 OF 1999 DATED 01-04-2009 IN THE CASE OF DCIT V. RADHE DEVELOPERS (I) LTD. HE STATED THE FACTS THAT THE NOTING AND JOTTINGS ON PAGE 1 OF ANNEXURE-A/1 WERE FUTURE PROJECTIONS, FROM WHICH ASSESSEE HAS EXPECTED TO RECEIVE CERTAIN CONSIDERAT ION AND THIS WAS REPEATEDLY STATED BY THE ASSESSEE IN HIS STATEMENTS MADE U/S.1 32(4) OF THE ACT. HE STATED THAT ON THE BASIS OF SAID LOOSE PAPERS CERTAIN ADDITIONS WERE MADE IN THE CASE OF RADHE DEVELOPERS (I) LTD. AND OTHERS IN THE CASE OF ASSES SEE AND THE FOLLOWING ARE THE ADDITIONS MADE IN THE CASE OF THE ASSESSEE:- PARTICULARS AMOUNT AS PER SEIZED MATERIAL ADDITIONS MADE BY ASSESSING OFFICER ADDITIONS DEALT IN 111 2.5 2,50,00,000 ASHISH PATEL 148 3.20 3,20,00,000 ASHISH PATEL .MANOJ 1,50 1,50,00,000 RADHE DEVELOPERS ETC. 2.00 2,00,00,000 ASHISH PATEL IT(SS)A NO.16/AHD/2007 B.P. 1-4-85 TO 31-3-95 & 1-4-95 TO 14-3-96 ASHISH P PATEL V. DCIT, CC-1(2) ABD PAGE 13 CHEKLA 2.00 2,00,00,000 ASHISH PATEL 1742NET 1,50 1,50,00,000 ASHISH PATEL 4800(21) 2.50 2,50,00,000 ASHISH PATEL SHIKAR 0.70 70,0,000 RADHE DEVELOPERS MAKARBA 1.00 1,00,00,000 ASHISH PATEL 154 4.51 4,51,00,000 RADHE DEVELOPERS 162 2.33 2,33,00,000 ASHIS H PATEL 82 2.50 2,50,00,000 ASHISH PATEL 387 11.61 11,61,00,000 ASHISH PATEL THE LD. COUNSEL FOR THE ASSESSEE STATED THAT THE EN TIRE PAGE REPRESENTS PROJECTION OF THE AMOUNT EXPECTED TO BE RECEIVED BY HIM AND AMOUN T EXPECTED TO BE PAID BY HIM. HE REFERRED TO THE FIGURES ON RIGHT HAND SIDE, WHIC H REFERS TO THE AMOUNT EXPECTED TO BE RECEIVED AND FIGURES ON THE LEFT HAND SIDE REFER S TO THE PAYMENTS EXPECTED TO BE MADE BY HIM IN THE FUTURE. HE FURTHER STATED THAT A SSESSEE HAS TO MAKE PROJECTIONS SO AS TO KNOW HOW HE WOULD MEET WITH THE DIFFERENT NEEDS OF BUSINESS IN FUTURE AND THE AFORESAID PAPER FOUND REPRESENTS ONLY FUTURE EX PECTED CASH FLOW TO BE RECEIVED BY ASSESSEE AND DOES NOT REPRESENT ANY UNACCOUNTED INVESTMENT/RECEIPT HENCE NO ADDITION CAN BE MADE TREATING FUTURE PROJECTS AS UN ACCOUNTED INVESTMENT. 13. THE LD. COUNSEL FOR THE ASSESSEE NARRATED THE I NDIVIDUAL ITEMS AS UNDER:- (I) HE STATED WITH REGARDS TO ADDITION PERTAINING T O CODE 111, THE STATEMENT OF ASSESSEE WAS RECORDED AND AT QUESTION NO. 15, ASSES SEE WAS ASKED TO EXPLAIN THE SAME WHICH IS REPRODUCED HEREINUNDER:- Q.15 PLEASE REFER AGAIN TO PAGE-1 AND STATE WHAT THE FIG URE 111, 148 NET, 1828 NET IT REPRESENT. PLEASE SPECIFY THE MEANING ALL TH E NOTINGS IN THE COLUMN AND STATE IN FULL THE AMOUNTS WRITTEN IN FROM OF EA CH? 111 CODE GIVEN BY ME OF LAND OF SCHEME OR TO N.T.C. IN WHICH I HAVE OR MY COMPANY HAS LENDED MONEY OF SUM OF RUPEES 25,00,000 /- APPROX SITUATED NEAR SARDAR PATEL COLONY FOUR ROADS APART FROM ABOVE, DURING THE COURSE OF RELEVANT ASS ESSMENT PROCEEDINGS, ASSESSEE HAS CONSISTENTLY STATED THAT RADHE DEVELOPERS (INDI AN) LTD. IN WHICH ASSESSEE IS A MANAGING DIRECTOR, HAS INVESTED BY CHEQUES OF RS.29 ,55,000 AND SUCH AMOUNT WAS GIVEN TO NTC NAMED ISHWARKRUPA NTC WHICH OWNED LAND NEAR SARDAR PATEL, COLONY, IT(SS)A NO.16/AHD/2007 B.P. 1-4-85 TO 31-3-95 & 1-4-95 TO 14-3-96 ASHISH P PATEL V. DCIT, CC-1(2) ABD PAGE 14 FOUR ROADS. IN THE ABOVE STATEMENT RECORDED OR IN T HE SUBMISSION, IT HAS NOWHERE STATED THAT IT WAS UNACCOUNTED INVESTMENT WHEREAS F ACT IS THAT AMOUNT IS ALREADY RECORDED IN BOOKS OF RADHE DEVELOPERS AND ASSESSEE WAS EXPECTING TO RECEIVE THE SAME AMOUNT BACK. (II) THE LD. COUNSEL FOR THE ASSESSEE STATED, WITH REGARDS TO CODE 148 WITH REFERENCE TO AMOUNT MENTIONED FOR 3.20 IN SAID ANNE XURE, DURING THE COURSE OF SEARCH, IN THE STATEMENT, ASSESSEE HAS STATED AS UN DER:- 148. RADHE FINANCE HAS LENDED MONEY TO NTC AT MAH ADEVNAGAR FOUR ROADS. MONEY LENDED IS MORE BUT I WILL GET RS.32,00 ,000/- WITHIN THREE MONTHS. HE FURTHER STATES THAT IN FACT RADHE FINANCE HAD GI VEN A LOAN OF RS.76,18,808/- BY ACCOUNT PAYEE CHEQUES TO AKASH OWNERS ASSOCIATION F OR LAND NEAR MAHADEVNAGAR FOUR ROADS FROM THE BOOKS OF RADHE FINANCE, A PROPR IETARY CONCERNS OF ASSESSEE. AS ASSESSEE WAS EXPECTING PORTION TO RECEIVE RS.32,00, 000/- FROM SAID LAND, IT WAS MENTIONED IN THE RIGHT HAND SIDE OF LOOSE PAPER SEI ZED AS EXPECTED FUTURE INFLOW. IT IS STATED THAT AFORESAID FACT, CLEARLY PROVES THAT SUC H AMOUNT REPRESENTS FUTURE EXPECTED AMOUNT TO BE RECEIVED AND NOT AN UNACCOUNT ED INVESTMENT. (III) AS REGARD TO CODE ETC. WITH REFERENCE TO AMO UNT MENTIONED FOR 2.00 IN THE AFORESAID ANNEXURE, SHRI ASHISH P PATEL, IN HIS STA TEMENT HAS STATED AS UNDER:- ETC. MEANS INSTALLMENTS TO BE RECEIVED FROM FLATS, LAND , OFFICE BOOKED BY MY VARIOUS FIRMS. HE FURTHER STATED THAT EVEN DURING THE COURSE OF AS SESSMENT PROCEEDINGS, IT HAS BEEN STATED THAT HAD ETC. MEAN INSTALLMENTS TO BE RECEIVED FROM FLATS, LAND, OFFICES BOOKED BY HIS VARIOUS FIRMS. IT WAS FURTHER STATED THAT IN HIS VARIOUS CONCERNS, ASSESSEE HAS FLOATED DIFFERENT SCHEMES LIKE RADHE ACRE, THIRTHBHOOMI, R A TRADE CENTRE, GANESH PLAZA AND THIRTHDHAM AND ASSESSEE EX PECTED TO RECEIVE THE AMOUNTS FROM DIFFERENT PARTIES, WHO WOULD BOOK FLAT S, OFFICES ETC. IT IS FURTHER STATED, THAT AT THE TIME OF SEARCH AS WELL AS DURING THE CO URSE OF ORIGINAL ASSESSMENT, ASSESSEE HAS STATED THAT THE AFORESAID AMOUNT REPRE SENTS PROJECTIONS ONLY AND FUTURE AMOUNTS EXPECTED TO BE RECEIVED. THE ASSESSE E HAS, NOWHERE STATED THAT SUCH AMOUNT REPRESENTED UNACCOUNTED INVESTMENT. SUC H AMOUNT IS ENTIRELY BASED IT(SS)A NO.16/AHD/2007 B.P. 1-4-85 TO 31-3-95 & 1-4-95 TO 14-3-96 ASHISH P PATEL V. DCIT, CC-1(2) ABD PAGE 15 ON FUTURE PROJECTION AT A PARTICULAR POINT OF TIME AND HAD NOTHING TO DO WITH ANY UNACCOUNTED INVESTMENT OR UNACCOUNTED RECEIPTS IN T HE CASE OF THE ASSESSEE. IN VIEW OF SUCH FACTS, IT IS STATED THAT ON THE BASIS OF PROJECTED FIGURE, NO ADDITION IS CALLED FOR. (IV) AS REGARD TO CODE CHEKHLA, MENTIONED IN THE AFORESAID ANNEXURE SEIZED DURING THE COURSE OF SEARCH, ASSESSEE IN HIS STATEMENT HAS STATED THAT - CHEKLA IS THE NAME OF THE VILLAGE FOR WHICH I HAVE GIVEN MONEY TO MAY FATHER IN-LAW, HIS LAND IS THERE FOR PURCHASING IT AND SEL LING TO SAME ONE OTHER IS MY PLAN. EXPECTED PROFIT IS RS.20,00,000/- THE ASSESSEE FROM THE VERY BEGINNING, HAS CATEGORIC ALLY STATED THAT SAID AMOUNT IS LIKELY TO RESULT INTO EXPECTED PROFIT TO BE RECEIVE D BY IT AND DOES NOT REPRESENT ANY UNACCOUNTED INVESTMENT. THE ASSESSEE FURTHER STATED THAT IT HAS GIVEN MONEY TO HIS FATHER-IN-LAW AND HE EXPECTED A PROFIT OF RS.20, LA KHS, WHEN THE LAND WILL BE SOLD. IT IS STATED THAT THERE IS NOT REASON TO BELIEVE THAT ASSESSEE HAD MADE INVESTMENT OUTSIDE THE BOOKS OF ACCOUNT. IN FACT, THE ASSESSEE HAS GIVEN TO HIS FATHER-IN-LAW, RAJAN HARIVALLABHDAS, A SUM OF RS.20 LAKH FROM THE BOOKS OF ACCOUNT OF RADHE ESTATE DEVELOPERS, WHEREIN, ASSESSEE IS A PARTNER T HROUGH ACCOUNT PAYEE CHEQUES AND EVEN THE BOOKS OF ACCOUNT OF RADHE ESTATE DEVEL OPERS, WERE IN POSSESSION OF THE DEPARTMENT, AT THE TIME OF ORIGINAL ASSESSMENT PROCEEDINGS AND ACCOUNT OF HIS FATHER-IN-LAW WOULD SHOW THAT THE ASSESSEE HAS ADVA NCED RS.20 LAKHS. THE AFORESAID FACTS CLEARLY ESTABLISH THAT THE ASSESSEE WAS EXPECTING PROFIT OF RS.20 LAKHS FROM THE SALE OF SAID LAND, WHICH WAS MERELY A PROJECTION AND NOT AN ACTUAL RECEIPT OR ANY UNACCOUNTED INVESTMENT. (V) AS REGARDS TO CODE 1742 NET, MENTIONED IN ANNEX URE A-1, SEIZED DURING THE COURSE OF SEARCH, THE ASSESSEE HAS STATED AS UNDER :- 1742 NET LAND ADMEASURING 1742 SQ.YARD IS SITUATED NEAR OLD L.T. COLLEGE WHERE I HAVE FINANCED THAT I AM GOING TO WITHDRAW. RS.15,00,000/- IT IS STATED THAT THE ASSESSEE WAS EXPECTING TO WIT HDRAW RS.15 LAKHS FROM THE LAND 1742. IT IS FURTHER STATED THAT THE ASSESSEE HAS AD VANCED RS.17 LAKHS BY CHEQUES TO ANJAN, NON-TRADING ASSOCIATION IN RESPECT OF AFORES AID LAND, WHICH WAS SITUATED NEAR OLD L.J. ROAD. AS THE ASSESSEE WAS EXPECTING TO WIT HDRAW RS.15 LAKHS FROM THE IT(SS)A NO.16/AHD/2007 B.P. 1-4-85 TO 31-3-95 & 1-4-95 TO 14-3-96 ASHISH P PATEL V. DCIT, CC-1(2) ABD PAGE 16 SAME, ASSESSEE HAS NOTED IT AS FUTURE PROJECTED CAS H INFLOW. IN VIEW OF SUCH FACTS, IT IS STATED THAT AFORESAID AMOUNT CANNOT BE ADDED IN THE CASE OF ASSESSEE AS IT REPRESENTS FUTURE PROJECTION AND NO REAL INCOME ACT UALLY RECEIVED BY THE ASSESSEE. (VI) AS REGARD TO CODE 4800(21), FOR AN AMOUNT OF R S.2.50 MENTIONED IN AFORESAID ANNEXURE, THE ASSESSEE HAS STATED IN THE STATEMENT RECORDED DURING THE COURSE OF SEARCH 480021 LAND NEAR TIRTHDHAM SCHEME APPROXIMATELY 4800 SQ. YARDS OF (21) NOC IS THERE IN WHICH IF I DEAL IN IT BY PURCHASIN G AND SELLING IT IMMEDIATELY I CAN EARN RS.25,00,000/- IN THIS CONNECTION, THE ASSESSEE STATED IN REPLY TH AT, AT THE TIME OF SEARCH AS MENTIONED ABOVE WAS CLEAR TO THE EFFECT THAT IF HE WOULD INVEST IN THE LAND 4800, NR. THIRTHDHAM SCHEME BY MAKING DEALING OF PURCHASE AND SALE OF SAID LAND, HE COULD EARN RS.25 LAKHS IMMEDIATELY. THE AMOUNT OF RS.25 L AKHS IS NOTHING, BUT EXPECTED AMOUNT TO BE RECEIVED. THE ASSESSEE HAS NOT INVESTE D AT ALL, ANY AMOUNT IN THE SAID LAND. IN VIEW OF SUCH FACTS, AMOUNT OF RS.25 LAKHS ARE FUTURE EXPECTATION AND PROJECTED EARNING AND NOT ACTUAL INCOME/INVESTMENT. (VII) AS REGARD TO CODE 162, FOR RS.2.33 AS MENTIO NED IN THE AFORESAID ANNEXURE. DURING THE COURSE OF SEARCH, THE ASSESSEE WAS ASKED TO EXPLAIN THE SAME AT Q. NO.18. THE RELEVANT PARA IS REPRODUCED AS UNDER:- PLEASE REFER TO PAGE 18 OF ANNEXURE A-1 AND STATE WHAT 154, 162 82 REPRESENTS AS ALSO THE AMOUNT WRITTEN AGAINST EACH? 162 IS PLOT BEHIND K.H. MODI SCHOOL PLOT IS ADMEAS URING ABOUT OR AROUND 1800 SQ. YARDS. IN WHICH I OR MY ANY FIRM HAS INVES TED MONEY WHICH I WOULD LIKE WITHDRAWN OR SALE IT. DURING THE COURSE OF SEARCH AND AT THE TIME OF ORIG INAL BLOCK ASSESSMENT PROCEEDINGS, IT WAS STATED BY THE ASSESSEE THAT HE HAD INVESTED RS.64,705/- IN AMI BINDU MEMBERS ASSOCIATION, AND RS.64,705/- IN MILAN DEEP MEMBERS ASSOCIATION IN RESPECT OF AFORESAID LAND. THE AFORESAID INVESTMENT OF RS.1,29,410/- WAS MADE FROM BOOKS OF ACCOUNT OF RADHE FINANCE, IN WHICH THE ASS ESSEE IS PROPRIETOR. THE AFORESAID AMOUNT WAS THE EARNEST MONEY. AT THE RELE VANT PERIOD OF TIME, ASSESSEE WAS ENTITLED TO SELL THE LAND TO NTC AND WAS EXPECT ING TO RECEIVE SALE PROCEEDS OF IT(SS)A NO.16/AHD/2007 B.P. 1-4-85 TO 31-3-95 & 1-4-95 TO 14-3-96 ASHISH P PATEL V. DCIT, CC-1(2) ABD PAGE 17 RS.23,33,000/-. THE ASSESSEE WAS EXPECTING TO RECEI VE SUCH AMOUNT EITHER BY SALE OR BY WITHDRAWING THE AMOUNT FROM THE SAID LAND. (VIII) AS REGARD TO CODE 387, FOR RS.11.61 MENTIONE D IN AFORESAID ANNEXURE, ASSESSEE HAS STATED AS UNDER IN WHICH STATEMENT REC ORDED DURING THE COURSE OF SEARCH- 387. IS LAND SITUATED AT KOTESHWAR NEAR INDIRA BR IDGE. IT IS 387 SQ. YARD IN WHICH THERE ARE TWO MAIN LITIGATIONS. I AM TRYING H ARD FOR COMPLETING LITIGATION SO I COULD FETCH MORE THAN WHAT I HAVE INVESTED, ME ANS 1,16,10,000/- ONE CORE SIXTEEN LAKHS TEN THOUSAND ONLY AS PROFIT. APART FROM THE ABOVE, THE ASSESSEE HAS DURING THE C OURSE OF ASSESSMENT PROCEEDINGS HAS STATED THAT HE HAD INVESTED RS.21 L AKHS BY CHEQUES FROM THE BOOKS OF ACCOUNT OF RADHE FINANCE TO MAONORAMYA RESORT AN D HOTELS PVT. LTD. IT WAS EXPLAINED THAT SUCH LAND IN QUESTION BELONGED TO KO TESHWAR TRUST WHICH HAD ENTERED INTO AGREEMENT TO SELL THE SAID LAND TO MAONORAMYA RESORT AND HOTELS PVT. LTD. THE ASSESSEE HAS, THEREFORE, PAID MONEY BY WAY OF INVES TMENT OF RS.21 LAKHS TO MAONORAMYA RESORT AND HOTELS PVT. LTD., BECAUSE IT HAD ACQUIRED RIGHT TO PURCHASE THE SAID LAND NEAR INDIRA BRIDGE. AS THE AFORESAID LAND WAS UNDER LITIGATION I.E. ONE WITH KOTESHWAR TRUST AND SECOND LITIGATION HAS ARIS EN BECAUSE STATE GOVERNMENT HAD ENTERED IN THE REVENUE RECORDS OF THE SAID LAND AS BELONGING TO THE GOVERNMENT. AS THE ASSESSEE WAS TRYING HARD TO RESO LVE THE AFORESAID LITIGATION, HE WAS EXPECTING TO EARN A PROFIT OF RS.1.16 CRORES AS STATED DURING THE COURSE OF SEARCH. IN VIEW OF SUCH FACTS, IT IS STATED THAT TH IS WAS AN AMOUNT WRITTEN ON THE RIGHT SIDE OF ROUGH PAPER, WHICH THE ASSESSEE EXPECTED TO RECEIVE WHEN THE LITIGATION WAS SOLVED. (IX) AS REGARD TO CODE 82, FOR FIGURE MENTIONED OF 2.50, IN THE AFORESAID ANNEXURE. DURING THE COURSE OF ASSESSMENT, THE ASSESSEE HAS S TATED AS UNDER:- 82 IS PLOT OF AROUND FOUR HUNDRED FIFTY SQ. YARDS SLIGHTLY INSIDE THE MAIN NEAR MAHADEV NAGAR SOCIETY FOR WHICH RADHE FINANCE HAS F INANCED THE NTC AS SCHEME WILL START OF MY FINANCE MONEY WILL BE RETUN ED BACK BY HIM. ASSESSEE FURTHER STATED THAT IT HAS ADVANCED RS.26, 82,075/- TO VIRBHADRA NON- TRADING ASSOCIATION, IN RESPECT OF AFORESAID LAND F ROM HIS BOOKS OF ACCOUNT. THE IT(SS)A NO.16/AHD/2007 B.P. 1-4-85 TO 31-3-95 & 1-4-95 TO 14-3-96 ASHISH P PATEL V. DCIT, CC-1(2) ABD PAGE 18 ASSESSEE WAS EXPECTING TO WITHDRAW RS.25 LAKHS OUT OF THE AFORESAID AMOUNT ADVANCED BY HIM. HE HAD NOTED IT AS FUTURE PROJECTE D CASH INFLOW. APART FROM THE ABOVE, ASSESSEE STATES THAT THE PLOT IN QUESTION WA S IN FACT, PURCHASED BY VIRBHADRA NON-TRADING ASSOCIATION. EVEN THE INTEREST IS PAID BY THE SAID NTC TO THE ASSESSEE AND TAX IS DEDUCTED FROM THE INTEREST PAYMENT. ASSE SSEE FURTHER STATES THAT THE AFORESAID PLOT IS AD MEASURING 450 SQ.YDS. AND IF A SSESSEE HAD INVESTED RS.2.50 CRORES, AS STATED BY THE AO, IT WOULD MEAN THAT RAT E OF LAND PER SQ. YD. WOULD COME TO RS.55,555/- WHICH IS HIGHLY IMPOSSIBLE IN AHMEDA BAD. NO LAND IN AHMEDABAD CAN BE SOLD AT SUCH HUGE RATE. THE AMOUNT MENTIONED IN THE AFORESAID ANNEXURE REPRESENTS ROUGH NOTING WITH REGARDS TO FUTURE INFL OW OF THE ASSESSEE. 14. THE LD. COUNSEL FOR THE ASSESSEE EXPLAINED THAT THE AO IN HIS BLOCK ASSESSMENT ORDER HAS TRIED TO CORRELATE THE NOTINGS MENTIONED AS JNP.75, ON LOOSE PAPER NO.1 OF ANNEXURE A-1 WITH THAT OF NOTINGS ON PAGE NO.90 OF ANNEXURE-A/32, IN WHICH IT HAS BEEN MENTIONED AS JAYANTIBHAI SHROFF BALANCE 74,00,000 (89,00,000 15,00,000). ACCORDING TO HIM, THE AO HAS ALSO MAD E REFERENCE TO NOTINGS JNP.75 WITH THE NOTINGS FOUND FROM THE RESIDENCE OF SHRI J .N. PATEL. THE SAID COMPARISON AND CORRELATION SUFFERS FROM THE FOLLOWING DEFECTS: - (A) IN NEITHER OF THE PROCEEDINGS THE ASSESSEE WAS GIVEN THE COPIES OF THE NOTINGS FOUND FROM THE RESIDENCE OF SHRI J.N. PATEL FOR WHICH RELIANCE HAS BEEN PUT BY THE A.O (B) WITHOUT PREJUDICE TO ABOVE, THE NOTINGS WHICH H AVE BEEN RELIED BY THE A./O ON THE BASIS OF LOOSE PAPERS FOUND FROM RESIDENCE OF J YANTI N PATEL IS MATHEMATICALLY INCORRECT SINCE CORRECT BALANCE WHEN COMPUTED, WHICH COMES TO RS.81,00,000 AND NOT RS.75,00,000 AS STATED BY T HE A.O THUS, THE RELIANCE SO PLACED BY THE A.O BETWEEN THE LOOSE PAPERS SO FO UND FROM THE POSSESSION OF THE ASSESSEE AND FROM THE RESIDENCE OF SHRI J.N. PATEL IS INCORRECT AND INCOMPARABLE. (C) THE REASON GIVEN BY THE A.O TO INFER THAT .75 M EANS RS.75,00,000 IS ALSO UNJUSTIFIED AND ARBITRARY FOR THE REASON THAT RS.74 ,00,000 FOUND IN A ROUGH PAPER NO. 90 OF ANNEXURE A A-32 HAS NO RELATION TO THE NOTINGS OF .75. THEREFORE, IT COULD NOT BE SAID THAT .74,00,000 HAS ANY RELATION TO LOOSE PAPER NO. ANNEXURE A/1. HE SUMMARIZE LOOSE PAPER NO. 71 WHICH WAS FOUND FRO M RESIDENCE OF JNP AND CONTAINING A BALANCE OF 75,00,000 HAS NO RELATION T O THE NOTING MADE ON LOOSE PAPER NO1 OF ANNEXURE -1 AS JNP0.75, SINCE THE NOTING MAD E ON LOSE PAPER NO.71 SUFFERS IT(SS)A NO.16/AHD/2007 B.P. 1-4-85 TO 31-3-95 & 1-4-95 TO 14-3-96 ASHISH P PATEL V. DCIT, CC-1(2) ABD PAGE 19 FROM MATHEMATICAL ERRORS FOR WHICH THE CORRECT BALA NCE COMES TO 86,00,000. HE PLACED RELIANCE ON LOOSE PAPER NO. 90 OF ANNEXURE A -32 FOUND FROM THE PREMISES OF RADHE DEVELOPERS (INDIA) LTD. WHEREIN NOTINGS AS JA YANTIBHAI SHROFF BALANCE 74,00,00 HAS BEEN NOTED HAS NO RELATION TO NOTINGS MADE ON LOOSE PAPER NO.1 OF ANNEXURE A/1 AS JNP .75, SINCE .75 IS DIFFERENT FRO M 74,00,000/-. HE FURTHER EXPLAINED THE OBSERVATIONS ON PAGE NO.24 OF THE BLO CK ASSESSMENT ORDER WAS MADE BY THE A.O THAT WHILE DELETING THE ADDITION IN THE CASE OF RADHE DEVELOPERS (INDIA) LTD. THE HONBLE ITAT HAS NOT CONSIDERED THE ABOVE MENTIONED REASONS AND ENTRIES IN THE BOOKS OF ACCOUNT OF SHRI J.N. PATEL WHICH EX ACTLY MATCHES WITH THE ENTRIES IN THE SEIZED PAPER. ACCORDING TO THE REVENUE THE SAI D DECISION IS NOT ACCEPTED BY THE DEPARTMENT AS THE REFERENCE TO THE HIGH COURT HAS B EEN MADE BUT NOW FINALLY THAT HAS BEEN DECIDED BY HONBLE HIGH COURT. ACCORDING T O THE LD. COUNSEL, THE ALLEGATION OF THE A.O THAT THE ISSUE VIS--VIS SHRI JAYANTI N PATEL WAS NOT CONSIDERED BY THE ITAT IS ERRONEOUS SINCE THE ASSESSEE HAD MAD E AN ARGUMENT ABOUT THE NOTINGS MADE AGAINST JNP.75 BEFORE THE ITAT, WHICH HAS ALSO BEEN DISCUSSED IN THE ITAT ORDER ON PAGE NO.17. ACCORDINGLY, THE ORDER PA SSED BY THE ITAT WAS AFTER CONSIDERING THE SAID ISSUE. THE SAID ORDER WAS CONF IRMED BY THE HONBLE HIGH COURT. HE STATED THAT THE ITAT HAD PASSED THE ORDER AFTER CONSIDERING ALL THE FACTS INCLUDING THAT OF JNP AND HENCE IT COULD BE HELD THAT THIS IS SUE WAS NOT DISCUSSED BY THE ITAT. THE A.O HAS ALSO MADE A REFERENCE TO THE STATEMENT OF L.T. SHROFF IN WHICH HE HAD STATED THAT ABOUT 3 CRORES WERE OUTSTANDING IN THE NAME OF ASSESSEE. THE ITAT WHILE SETTING ASIDE THE ASSESSMENT ORDER BACK TO TH E A.O HAD GIVEN A DIRECTION THAT IF THE A.O WANTS TO RELY UPON THE STATEMENT OF SHRI KA LPESH THAKKAR, THEN HE SHOULD SUPPLY THE COPY OF THE STATEMENT OF SHIR KALPESH TH AKKAR TO THE ASSESSEE AND ALSO ALLOW THE ASSESSEE AN OPPORTUNITY CROSS-EXAMINE HIM IF THE ASSESSEE SO REQUESTS BUT, SINCE NEITHER THE COPIES OF STATEMENT NOR CROS S EXAMINATION WAS PROVIDED, THE RELIANCE PLACED BY THE AO ON THE STATEMENT OF L.T. SHROFF IS MISPLACED. THE LD. COUNSEL FOR THE ASSESSEE REGARDING CODING AND DECOD ING OF ENTRIES BETWEEN MILLIONS AND CRORES SUBMITTED AS UNDER: (A) RELIANCE WAS PLACED BY THE A.O ON THE STATEMENT OF SHRI L.T. SHROFF BUT SINCE THE SAME IS NOT PROVIDED AND IN VIEW OF THE DIRECTI ON OF ITAT SUCH RELIANCE IS VOID AB INITO. (B) THE FACT THAT THE A.O HAS INTERPRETED E.G. 2.5 AS 25 CRORES AGAINST CODE NO.111 IS AN INCORRECT FINDING SINCE DETAILED EXPLA NATION WAS GIVEN BY THE IT(SS)A NO.16/AHD/2007 B.P. 1-4-85 TO 31-3-95 & 1-4-95 TO 14-3-96 ASHISH P PATEL V. DCIT, CC-1(2) ABD PAGE 20 ASSESSEE IN HIS PRELIMINARY STATEMENT, DETAILS OF W HICH HAVE BEEN MENTIONED ON PAGE NO.208 OF PAPER BOOK. SIMILAR EXPLANATIONS HAVE ALSO BEEN GIVEN IN RESPECT OF OTHER PROJECTIONS, FROM PAGE NO.208 ONWA RDS OF PAPER BOOK. 15. THE LD. COUNSEL FOR THE ASSESSEE FINALLY STATED THAT NOTINGS NOTED IN THE DOCUMENTS AS BARODA TRANSACTIONS AS 96 END MEANS AS SEARCH WAS CONDUCTED IN MARCH, 1996 AND THE DOCUMENTS NOTING THE TRANSACTIO NS OF THE DATE 96 END CANNOT BE TREATED AS DOCUMENTS HAVING TRANSACTIONS WHICH H AD ALREADY BEEN DONE AND IT CLEARLY PROVES THAT THE TRANSACTIONS NOTED IN THE D OCUMENTS REPRESENTS PROJECTIONS FOR THE YEAR ENDING 1996. THE LD. COUNSEL FOR THE ASSESSEE FURTHER STATED THAT IT CAN BE SEEN FROM THE ABOVE FACT, OUT OF THE AFORESAID A MOUNT NOTED IN THE ANNEXURE SEIZED FROM THE RESIDENCE OF THE ASSESSEE, THE ASSE SSING OFFICER MADE FOLLOWING ADDITION IN THE CASE OF RADHE DEVELOPERS (INDIA) LT D.:- MANOJ 1,50,00,000 SHIKAR 70,00,000 154 4,51,00,000 IN APPEAL TO ITAT, THE AHMEDABAD TRIBUNAL IN APPEAL NO.IT(SS)A NO.103/AHD/1997 HAS CATEGORICALLY HELD THAT AFORESAID AMOUNT ARE ON LY FUTURE PROJECTED AMOUNT AND CANNOT BE TREATED AS ACTUAL TRANSACTIONS AND DELETE D THE ADDITIONS MADE BY ASSESSING OFFICER. THE ITAT AT PARA-21 HAS OBSERVED AS UNDER:- IN OUR OPINION, THE THEORY OF PROJECTION SHALL HAV E TO BE ACCEPTED FOR VARIOUS REASONS. IT IS A MATTER OF FACT ON RECORD THAT SHRI ASHISH AT THE TIME OF HIS FIRST DEPOSITION HAD STATED THAT THE DOCUMENT REPRESENTED PROJECTIONS. SHRI ASHISH FURTHER GAVE EXPLANATION TO THE ENTRIES IN A CONSIS TENT MANNER, WHICH ARE CORRELATED WITH CORRESPONDING INVESTMENTS MADE BY C HEQUES AND RECORDED IN SEIZED BOOKS OF ACCOUNT. THE NOTING OF 96 END HAS TO BE INTERPRETED AS THE END OF THE CALENDAR YEAR IN VIEW OF ANSWER TO QUEST ION NO.2 OF STATEMENT DATED 14/3/1996. THEREFORE, IN ANY CASE THE NOTING ON PAGE NOS. 66 AND 67 DRAWN ON THE BASIS OF RELATED PAGES OF ANNEXURE A1 SEIZED FROM THE RESIDENCE OF SHRI ASHISH P PATEL CANNOT BE TREATED AS ACTUAL RECEIPT AND PAYMENT BUT FUTURE BUDGETARY PROJECTIONS ONLY. WE A RE ENCLOSING AS ANNEXURE TO THIS ORDER XEROX COPIES OF THE DOCUMENTS ON THE BASIS OF WHICH ADDITIONS HAD BEEN MADE. COPIES OF THE DOCUMENTS ARE ATTACHED AS PART OF THIS ORDER TO SHOW THAT THESE DOCUMENTS CANNOT BE CONSIDERED AS A N EVIDENCE AS PER SEC.93 OF THE EVIDENCE ACT., WHICH SAYS THAT WHEN T HE LANGUAGE USED IN A DOCUMENT IS, ON ITS FACT, AMBIGUOUS OR DEFECTIVE, E VIDENCE MAY NOT BE GIVEN ON FACTS WHICH WOULD SHOW ITS MEANING OR SUPPLY ITS DEFECTS. IT WILL BE PERTINENT TO NOTE THAT EVEN THE A O DID NOT CONSIDE R ALL THE ENTIRE NOTED IN THE DOCUMENTS. WHILE GOING THROUGH THE DOCUMENTS, WE FI ND THAT THE AO HAD ONLY CONSIDERED THREE ITEMS VIZ. MANOJ 1.5 (AT PAGE 1 OF ANNEXURE-A1), SHIKHAR,70 (AT PAGE 2 OF ANNEXURE-A1) AND 154 4. 51 (AT PAGE 18 OF IT(SS)A NO.16/AHD/2007 B.P. 1-4-85 TO 31-3-95 & 1-4-95 TO 14-3-96 ASHISH P PATEL V. DCIT, CC-1(2) ABD PAGE 21 ANNEXURE-A1) IN THE CASE OF THE ASSESSEE AND THE FO LLOWINGS WERE CONSIDERED IN THE CASE OF ASHISH P PATEL FOR THE BLOCK PERIOD: - ANNEXURE A1 PAGE 1 ANNEXURE A1 PAGE 18 1.111 2.50 162 2.33 2. 148 3.20 387 11.61 3. ETC. 2.00 82 2.50 4. CHEKLA 2.00 5. 1742 NET 2.00 6. 4800 (21) 2.50 7. MAKARBA 1.00 IT IS SURPRISING THAT HE HAD IGNORED THE NOTING MAD E IN THE DOCUMENTS AGAINST BARODA TRANSACTION 96 END. IF THE SEARCH WAS COND UCTED IN 1996 MARCH, THE DOCUMENT WHICH NOTES THE DATE 96 END CANNOT BE TR EATED AS A DOCUMENT HAVING TRANSACTION WHICH HAD BEEN ALREADY DONE. IT CAN ONLY ARISE WHEN THE DOCUMENT IS ACCEPTED AS PROJECTION UPTO END OF 1996 AS THE ASSESSEE SUBMITTED. FURTHER IT MAY BE NOTED THAT THE ASSESSI NG OFFICER HAD ACCEPTED SOME OF THE TRANSACTIONS WERE BELONGING TO THE ASSE SSEE ON THE BASIS OF INFORMATION GIVEN BY SHRI ASHISH PATEL, INSPITE OF THE FACT THAT DOCUMENTS WERE FOUND WITH SHRI ASHISH PATEL ONLY. THIS WAS DONE WI TH REFERENCE TO THE BOOKS OF ACCOUNT WHICH WERE SEIZED BY THE DEPARTMENT. IN SHORT, THE ASSESSEES EXPLANATION WAS ACCEPTED ABOUT OWNERSHIP OF THE ENT RIES WHEREAS THE EXPLANATION GIVEN OF PROJECTIONS WAS NOT ACCEPTED W HICH, ACCORDING TO US, IS CONTRADICTORY TO EACH OTHER. IT IS ALSO NOTED THAT THOUGH THE ASSESSING OFFICER CONSIDERED THE ENTRY AGAINST LAND AT BARODA (VILLAG E SANOLI), HE HAD ADDED ONLY RS.47 LACS INSPITE OF THE DOCUMENT SHOWING 50 .00 AND ACCORDING TO HIM, IT SHOULD BE RS.47 LACS INSPITE OF THE DOCUMEN T SHOWING 50.00 AND ACCORDING TO HIM, IT SHOULD BE RS.50 CRORES. THIS S HOWS THAT THE ASSESSING OFFICER HIMSELF WAS NOT SURE ABOUT THE CORRECTNESS OF THE DIGITS AS WELL AS THE CORRECT AFFAIRS OF THE TRANSACTIONS NOTED IN THE DO CUMENTS. IN THIS VIEW OF THE MATTER, WE ARE NOT ABLE TO SUSTAIN THE THREE ADDITI ONS OF RS.1.50 CRORES, RS.70 LACS AND RS.4.51 CRORES. THESE ADDITIONS ARE ACCORD INGLY DELETED. IT CAN BE SEEN THAT FINDING GIVING BY ITAT IS STATE MENT OF FACT AND AFTER CONSIDERING ENTIRE FACTS AND CONSIDERING ALL ASPECTS, IT HAS BE EN HELD THAT ENTIRE TRANSACTIONS ARE FOR FUTURE PROJECTS AND NOTHING TO DO WITH UNACCOUN TED INVESTMENT. FURTHER, DIFFERENT AMOUNT CONSIDERED AS STATED IN ABOVE CHART ARE FUTU RE PROJECTIONS AND NOT UNACCOUNTED INVESTMENT. IT IS STATED THAT ADDITION S MADE IN BOTH THE CASE I.E. ASHISH PATEL AND RADHE DEVELOPERS ARE FROM RIGHT HAND SIDE OF PAGE 1 OF SAME ANNEXURE A-1 HENCE IF DEPARTMENT IS CONSIDERING PART NOTTING S AS PROJECTED FIGURES IN THE CASE OF RADHE DEVELOPERS, REMAINING FIGURES HAS TO BE TR EATED AS PROJECTIONS IN THE CASE OF ASSESSEE. IT(SS)A NO.16/AHD/2007 B.P. 1-4-85 TO 31-3-95 & 1-4-95 TO 14-3-96 ASHISH P PATEL V. DCIT, CC-1(2) ABD PAGE 22 16. THE LD. COUNSEL FOR THE ASSESSEE STATED THAT EX ACTLY ON THE SAME FACTS, THE HONBLE HIGH COURT HAS ADMITTED FOLLOWING GROUND AT GROUND NO.22 FOR AFORESAID ADDITION. WHETHER THE TRIBUNAL WAS JUSTIFIED IN DECIDING THE ISSUES RESPECTING ADDITIONS OF RS.4.51 CRORE, 1.50 CRORES AND RS.70 LACS IN THE HANDS OF THE COMPANY WITHOUT HAVING FIRST DECIDED THESE ISSUES IN THE HA NDS OF SHRI ASHISH PATEL AS THESE ADDITIONS IN THE CASE OF ASSESSEE COMPANY WER E ONLY OF CONSEQUENTIAL/ HE STATED THAT, THE DEPARTMENT HAS NOT RAISED ANY G ROUND CHALLENGING THE FACT FINDING DECISION DECIDED BY ITAT WHICH IS STATES AS UNDER:- (A) THEREFORE, IN ANY CASE THE NOTING ON PAGE NOS. 66 AND 67 DRAWN ON THE BASIS OF RELATED PAGES OF ANNEXURE A1 SEIZED FROM T HE RESIDENCE OF SHRI ASHISH P PATEL CANNOT BE TREATED AS ACTUAL RECEIPT AND PAYMENT BUT FUTURE BUDGETARY PROJECTIONS ONLY. (REFER PAGE 21 OF ORDER ) (B) IT IS SURPRISING THAT HE HAD IGNORED THE NOTING MADE IN THE DOCUMENTS AGAINST BARODA TRANSACTION 96 END. IF THE SEARCH WAS CONDUCTED IN 1996 MARCH, THE DOCUMENT WHICH NOTES THE DATE 96 END C ANNOT BE TREATED AS A DOCUMENT HAVING TRANSACTION WHICH HAD BEEN TREATED AS A DOCUMENT HAVING TRANSACTION WHICH HAD BEEN ALREADY DONE. IT CAN ONL Y ARISE WHEN THE DOCUMENT IS ACCEPTED AS PROJECTION UPTO END OF 1996 AS THE ASSESSEE SUBMITTED. (PAGE 21-22 OF ORDER) IN SHORT, THE ASSESSEES EXPLANATION WAS ACCEPTED ABOUT OWNERSHIP OF THE ENTRIES WHEREAS THE EXPLANATION GIVEN OF PROJECTION S WAS NOT ACCEPTED WHICH, ACCORDING TO US, IS CONTRADICTORY TO EACH OTHER (PA GE 22 OF ORDER). (D) THE NOTING FOUND IN ANNEXURE A-1, PAGE 1 IS IN MILLION AND NOT IN CRORE. AS IN THE AFORESAID GROUND RAISED AND ADMITTED BEFO RE HIGH COURT, DEPARTMENT HAS NOT RAISED ANY GROUND CHALLENGING AFORESAID OBSERVA TION OF ITAT, HENCE, RATIO OF AFORESAID DECISION SQUARELY APPLIES TO THE FACTS OF THE CASE OF ASSESSEE. 17. THE LD. COUNSEL FOR THE ASSESSEE FINALLY STATED THAT THIS ISSUE IS NOW SQUARELY COVERED IN FAVOUR OF THE ASSESSEE AND AGAINST THE R EVENUE BY THE DECISION OF HONBLE GUJARAT HIGH COURT IN ASSESSEES SISTER CON CERN RADHE DEVELOPERS INDIA LTD. IN TAX APPEAL NO.171 OF 1999 DATED 01-04-2009, WHEREIN THE HONBLE HIGH COURT HAS RE-FORMULATED THE QUESTION TO BRING OUT T HE CORRECT CONTROVERSY BETWEEN THE PARTIES AND FOR THIS ISSUE THE RELEVANT QUESTIO N RE-FRAMED BY HONBLE HIGH COURT ARE Q. NO. 4 AND 5 AS UNDER:- IT(SS)A NO.16/AHD/2007 B.P. 1-4-85 TO 31-3-95 & 1-4-95 TO 14-3-96 ASHISH P PATEL V. DCIT, CC-1(2) ABD PAGE 23 4. WHETHER, ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE TRIBUNAL IS JUSTIFIED IN LAW IN DELETING ADDITION OF RS.99.50 L ACS AND RS.4.00 LACS MADE BY THE ASSESSING OFFICER AS UNEXPLAINED CREDITS U/S.68 OF THE ACT? 5. WHETHER, ON THE FACTS AND IN THE CIRCUMSTANCES O F THE CASE, THE TRIBUNAL IS RIGHT IN LAW IN DELETING ADDITIONS OF RS.1.5 CRORES , RS.70 LACS AND RS.4.51 CRORES.? THE LD. COUNSEL FOR THE ASSESSEE STATED THAT THE SA ME PAPER WAS THE SUBJECT-MATTER BEFORE THE HONBLE HIGH COURT AND HONBLE HIGH COUR T HAS CONSIDERED THE FACTS IN PARAS-7.4 AS UNDER:- 7.4 IN RELATION TO THE REMAINING THREE ADDITIONS O F RS.1,50,00,000/- RS.70,00,000/- AND RS.4,51,00,000/- IT WAS SUBMITTE D THAT LOOSE PAPER FILE ANNEXURE A-1 WHICH WAS SEIZED FROM RESIDENCE OF SHR I ASHISH PATEL CONTAINED PARALLEL BALANCE-SHEET AS COULD BE SEEN FROM PAGE NOS. 1 AND 18 OF THE SAID FILE AND THE SAID PAGES CONTAINED FOLLO WING THREE REFERENCES: (A) MANOJ 1,50,000,00 (B) SHIKHAR 70,000,00 154 4,51,000,00 THAT THE AFORESAID AMOUNTS HAD BEEN ADDED BY THE AS SESSING OFFICER AFTER RECORDING STATEMENT OF SHRI ASHISH PATEL AND THUS W AS REQUIRED TO BE RETAINED, THE TRIBUNAL HAVING WRONGLY DELETED THE S AME. AND THE HONBLE HIGH COURT HAS CONFIRMED THE ORDER OF THE TRIBUNAL AND DISMISSED THE REVENUES APPEAL ON THIS ISSUE BY HOLDING (IN P ARA-17) AS UNDER:- 17. IN SO FAR AS THE REMAINING THREE ADDITIONS OF RS.1,50,00,000/- RS70,00,000/- AND RS.4,51,00,000/- ARE CONCERNED, T HE TRIBUNAL HAS AFTER APPRECIATING EVIDENCE ON RECORD FOUND THAT THE SAID FIGURES WERE PROJECTED BUDGETARY ESTIMATES AND NO ACTUAL TRANSACTIONS HAD TAKEN PLACE. THERE IS NO EVIDENCE ON RECORD TO INDICATE THE CONTRARY. IN THE CIRCUMSTANCES, IT IS NOT NECESSARY TO MAKE ANY FURTHER DISCUSSION IN THIS RE GARD. IN VIEW OF THE JUDGMENT OF HONBLE HIGH COURT IN AS SESSEES SISTER CONCERN, THE LD. COUNSEL FOR THE ASSESSEE STATED THAT SAME PAGES NOS . 1 AND 18 OF ANNEXURE A-1 ARE THE SUBJECT-MATTER IN THE PRESENT CASE ALSO AND THE HONBLE HIGH COURT HAS CATEGORICALLY STATED THAT THE TRANSACTIONS NOTED IN THE SEIZED PAPERS ARE ONLY BUDGETARY FIGURES AND NOT ACTUAL TRANSACTIONS. HE STATED THAT THE FACTS BEING EXACTLY IDENTICAL AND THE FIGURES EMANATING FROM THE SAME S EIZED PAGES AS REFERRED ABOVE IN VARIOUS PARAS, THE SAME CANNOT BE INTERPRETED IN AN Y OTHER MANNER. HE STATED THAT IT(SS)A NO.16/AHD/2007 B.P. 1-4-85 TO 31-3-95 & 1-4-95 TO 14-3-96 ASHISH P PATEL V. DCIT, CC-1(2) ABD PAGE 24 EVEN THE REVENUE IN THE SECOND ROUND COULD NOT ADDU CE ANYTHING DESPITE DIRECTIONS FROM THE TRIBUNAL IN THE FIRST ROUND, IN THE ABSENC E OF CONTRARY, THE ADDITION MADE BY THE ASSESSING OFFICER CANNOT BE SUSTAINED. 18. ON THE OTHER HAND, THE LD. CIT-DR RELIED ON THE BLOCK ASSESSMENT ORDER FRAMED IN THE SECOND ROUND AND STATED THAT THE ASSE SSEE COULD NOT REBUT THE SEIZED PAPERS FOUND DURING THE COURSE OF SEARCH AND ACCORD INGLY THE ADDITION MADE BY ASSESSING OFFICER SHOULD BE SUSTAINED. 19. WE HAVE HEARD THE RIVAL CONTENTIONS AND GONE TH ROUGH THE FACTS AND CIRCUMSTANCES OF THE CASE. WE FIND FROM PAGES NOS.1 AND 18 OF ANNEXURE A-1 SEIZED DURING THE COURSE OF SEARCH FROM THE PREMISE S OF THE ASSESSEE, THAT THE SAME PAPER WAS SUBJECT-MATTER OF ADJUDICATION BEFORE THE HONBLE HIGH COURT AND HONBLE HIGH COURT HAS CATEGORICALLY INTERPRETED THE PAGES THAT THE TRANSACTIONS NOTED IN THE SEIZED PAPERS ARE ONLY BUDGETARY FIGURES AND NOT AC TUAL TRANSACTIONS. WE FIND THAT THE FACTS BEING EXACTLY IDENTICAL AND THE FIGURES E MANATING FROM THE SAME SEIZED PAGES AS REFERRED ABOVE IN VARIOUS PARAS OF THIS OR DER, THE PAGES INTERPRETED BY THE HONBLE HIGH COURT CANNOT BE INTERPRETED IN ANY OTH ER MANNER. MOREOVER, THESE QUESTIONS WERE STATED BEFORE THE HONBLE HIGH COURT IN IDENTICAL CASE, IN ASSESSEES SISTER CONCERN AND THE SUBJECT-MATTER IS THE SAME I .E. PAGES 1 AND 18 SEIZED DURING SEARCH AND ANSWERED BY HONBLE HIGH COURT, SIMILAR ISSUE, WHICH IS IN THE PRESENT CASE, CANNOT BE ANSWERED DIFFERENTLY. THE DECISION OF HONBLE HIGH COURT IN ASSESSEES SISTER CONCERN CASE WHERE EXACTLY THE FA CTS WERE SAME, THE HONBLE HIGH COURT HAS CLEARLY STATED WHILE INTERPRETING PAGES 1 AND 18 OF ANNEXURE-A-1 THAT THE FIGURES RECORDED IN THESE PAGES ARE PROJECTED BUDGE TARY ESTIMATES AND NOT THE ACTUAL TRANSACTIONS THAT HAD TAKEN PLACE. IN THE P RESENT CASE BEFORE US ALSO, THE SAME PAGES 1 AND 18 OF ANNEXURE A-1 IS THE SUBJECT- MATTER AND ACCORDING TO US, IN VIEW OF THE DISCUSSIONS CARRIED OUT AND ARGUMENTS O F THE LD. COUNSEL NOTED IN PARAS- 10 TO 13 OF THIS ORDER, THE FIGURES, TRANSACTIONS NOTED ARE ESTIMATED BUDGETARY PROJECTIONS AND NOT THE ACTUAL TRANSACTIONS THAT HA D TAKEN PLACE. BEFORE US THE REVENUE COULD NOT CONTRADICT THE ABOVE FACTS NARRAT ED BY THE ASSESSEE IN PARA-10 TO 13 OF THIS ORDER. THE HONBLE HIGH COURT HAS REFRA MED THE QUESTIONS REFERRED AND THE STATED QUESTIONS IN IDENTICAL CASE STAND ALREAD Y ANSWERED BY HONBLE HIGH COURT AND THE DECISION OF HONBLE HIGH COURT IS BINDING O N THIS TRIBUNAL. IN NUTSHELL, IT MAY IT(SS)A NO.16/AHD/2007 B.P. 1-4-85 TO 31-3-95 & 1-4-95 TO 14-3-96 ASHISH P PATEL V. DCIT, CC-1(2) ABD PAGE 25 BE STATED THAT THE TRIBUNAL FUNCTIONING WITHIN THE JURISDICTION OF A PARTICULAR HIGH COURT, IN RESPECT OF WHOM THE HIGH COURT HAS THE PO WER OF SUPERINTENDENCE UNDER ARTICLE 227, ARE BOUND TO FOLLOW THE DECISION OF TH E HIGH COURT UNLESS, ON AN APPEAL TO THE SUPREME COURT, THE OPERATION OF THE JUDGMENT IS SUSPENDED. IT IS NOT PERMISSIBLE FOR AUTHORITIES AND THE TRIBUNALS TO IG NORE THE DECISION OF HONBLE HIGH COURT OR TO REFUSE TO FOLLOW THE DECISION OF THE HI GH COURT ON THE PRETEXT THAT AN APPEAL HAS BEEN FILED BEFORE THE HONBLE SUPREME CO URT WHICH IS BINDING OR THAT STEPS ARE TAKEN TO FILE AN APPEAL. RESPECTFULLY FOL LOWING THE JUDGMENT OF HONBLE HIGH COURT IN THE CASE OF ASSESSEES SISTER CONCERN RDIL (SUPRA) IN TAX APPEAL NO.171 OF 1999 DATED 01-04-2009, WE DELETE THE ADDITIONS IN R ESPECT OF THE ABOVE COMMON ISSUES. THESE COMMON ISSUES OF THE ASSESSEES APPE AL ARE ALLOWED. 20. THE NEXT ISSUE IN THIS APPEAL OF THE ASSESSEE I S AGAINST THE BLOCK ASSESSMENT ORDER IN RESPECT OF GROUND NO.6.21 AS UNDER:- 21. THE UNEXPLAINED INVESTMENT IN LAND AT VILLAGE SANOLI BARODA AS PER PARA 10 TO 10.1 RS.47,00,000 21. THE BRIEF FACTS ARE THAT DURING THE COURSE OF S EARCH PAGE 1 OF ANNEXURE-A-1 SEIZED FROM THE PREMISES OF THE ASSESSEE AND ANNEXU E-A-3 SEIZED FROM THE RESIDENCE OF SHRI ARUN B SHAH REVEALED THAT PAGE NO .31 TO 33 OF ANNEXURE A-3 ARE DRAFT AGREEMENTS BETWEEN ASSESSEE AND V.V. PATEL FA MILY-TRUST AND AS PER THIS DRAFT IT WAS PROPOSED THAT THE ASSESSEE WOULD PROVI DE FINANCE TO THE TRUST FOR ACQUIRING LAND AS NOTED ABOVE. THE ASSESSEE PROVID ED FINANCE TO V.V. PATEL FAMILY- TRUST FROM HIS PROPRIETARY CONCERN M/S. RADHE FINAN CE AMOUNTING TO RS.1,09,13,776/-. V.V. FAMILY-TRUST PURCHASED LAND MAKING 47 PLOTS AD MEASURING 10 ACRES OF EACH PLOT. ACCORDING TO THE ASSESSING OFFICER THE TRUST WAS PROVIDED FINANCE BY M/S. RADHE FINANCE AND DIRECT DRAFTS WER E GIVEN TO THE VILLAGES AMOUNTING TO RS.1.25 LAKH BY V.V. FAMILY-TRUST OUT OF MONEY RECEIVED FROM M/S. RADHE FINANCE. ACCORDING TO AO, FURTHER IT CAME TO LIGHT THAT AGREEMENTS WERE MADE FOR RS.1.25 LAKH BUT ACTUAL AMOUNT WAS GIVEN T O FARMERS AT RS.1.25 LAKH. ACCORDINGLY, THE AO MADE ADDITION OF RS.1 LAKH EACH ON ACCOUNT OF ON-MONEY PAID TO 47 FARMERS. THE UNDISCLOSED INCOME WAS ADDED TO THE RETURNED INCOME AT RS.47 LAKHS. IT(SS)A NO.16/AHD/2007 B.P. 1-4-85 TO 31-3-95 & 1-4-95 TO 14-3-96 ASHISH P PATEL V. DCIT, CC-1(2) ABD PAGE 26 22. IN VIEW THE ABOVE FACTS, BOTH THE SIDES MADE TH EIR ARGUMENTS AND AFTER HEARING THE RIVAL CONTENTIONS, WE FIND THAT EVEN IF WE ACCEPT THE PLEA OF THE REVENUE THAT THE RADHE FINANCE HAS FINANCED THIS AMOUNT TO THE EXTENT OF RS.1,09,13,776/-, THE ON-MONEY PAYMENT IS OUT OF EXPLAINED SOURCE BUT SINCE THERE IS NO EVIDENCE WITH THE REVENUE AUTHORITIES THIS PLEA CANNOT BE ACCEPTE D. IN ANY CASE, THE ADDITION IS TO BE MADE THAT HAS TO BE MADE IN THE CASE OF V.V. PAT EL FAMILY-TRUST AND NOT IN THE CASE OF ASSESSEE AS THE LAND WAS PURCHASED BY V.V. PATEL FAMILY-TRUST AND NOT THE ASSESSEE. ACCORDINGLY, THE ADDITION MADE BY THE AS SESSING OFFICER IN HIS BLOCK ASSESSMENT ORDER DESERVED TO BE DELETED ON BOTH COU NTS. ACCORDINGLY, THIS ISSUE OF THE ASSESSEES APPEAL IS ALLOWED. 23. THE NEXT ISSUE IN THIS APPEAL OF THE ASSESSEE IS AS REGARDS TO THE BLOCK ASSESSMENT ORDER MAKING ADDITION ON ACCOUNT OF UNEX PLAINED INCOME IN LAL BUNGALOW. FOR THIS, THE ASSESSEE HAS RAISED THE FO LLOWING GROUND NO.6.22 AS UNDER:- 22. UNEXPLAINED INVESTMENT IN LAL BUNGALOW AS PER 536,96,000 PARA 11.2 TO 11.3 24. THE BRIEF FACTS LEADING TO THE ABOVE ISSUE ARE THAT DURING THE COURSE OF SEARCH A NUMBER OF LOOSE PAPERS PERTAINING TO LAND SITUATE D NEAR TELEPHONE EXCHANGE, NAVARANGPURA, AHMEDABAD WAS FOUND AND SEIZED. THIS LAND WAS KNOWN AS LAL BUNGALOW LAND COMPRISING OF AN AREA OF 19000 SQ.YD. THIS LAND IS SITUATED IN POST AREA OF CITY KNOWN AS C.G. ROAD. ACCORDING TO ASSE SSING OFFICER, THIS LAND WAS ACQUIRED BY ASSESSEE AS CHAIRMAN OF GANGA CO.OP. HO USING SOCIETY, THE SOCIETY REGISTERED UNDER BOMBAY CO.-OP SOCIETIES ACT, `1925 STARTED MAING PURCHASES OF LAL BUNGALOW LAND IN THE NAME OF GANGA CO-OP. HOUSI NG SOCIETY. A NUMBER OF BANAKHATS WERE MADE WHICH HAVE BEEN SEIZED DURING T HE COURSE OF SEARCH AS PER ANNEXURE-A/34 AND THE AFFIDAVITS FROM THE ACCOUNTAN T VIDE ANNEXURE A-39 OF PANCHNAMA DATED 14-03-1996. IN VIEW OF THESE FACTS, THE ASSESSING OFFICER DEALT WITH THE ISSUE IN PARA-11.3 OF THE BLOCK ASSESSMENT ORDER AND MADE ADDITION OF INVESTMENT AS UNEXPLAINED INVESTMENT TO THE UNDISCL OSED INCOME OF THE ASSESSEE AMOUNTING TO RS.5,36,96,000/- BY GIVING FOLLOWING F INDINGS:- IT(SS)A NO.16/AHD/2007 B.P. 1-4-85 TO 31-3-95 & 1-4-95 TO 14-3-96 ASHISH P PATEL V. DCIT, CC-1(2) ABD PAGE 27 11.3 DURING THE COURSE OF SET ASIDE ASSESSMENT PRO CEEDINGS, THE ASSESSEE WAS AGAIN REQUIRED TO EXPLAIN THE ENTRIES ON THESE DOCUMENTS AND ALSO TO EXPLAIN AS TO WHY ADDITION BE NOT MADE ON ACCOUNT O F UNEXPLAINED INVESTMENT IN LAL BUNGALOW LAND. THE ASSESSEE VIDE HIS REPLY D TD. 12-12-06 HAS STATED THAT THE FIRST AND SECOND COLUMN ON PAGE 106 OF ANN EXURE A-3 CONTAIN THE DETAILS OF INVESTMENTS IN SHELA LAND WHICH IS CONSI DERED IN THE CASE OF RADHE DEVELOPERS (INDIA) LTD. THE THIRD COLUMN IS THE INV ESTMENT IN LAL BUNGALOW LAND AND FOURTH COLUMN IS THE TOTAL INVESTMENT IN S HELA LAND AND LAL BUNGALOW LAND. THE FIFTH COLUMN IS THE SCHEDULE OF PAYMENTS FOR SHELA LAND. THE REPLY OF THE ASSESSEE VIS--VIS FACTS ON RECORDS HAVE BEEN V ERIFIED AND IT IS NOTICED THAT THE TOTAL INVESTMENT AS PER COLUMN 5 AT RS.22, 32,26,000/- WAS THE TOTAL OF INVESTMENT IN SHELA LAND AS WELL AS LAL BUNGALOW LA ND UPTO AUGUST 1995. TOTAL OF COLUMN 1,2 AND 3 UPTO AUGUST 1995 IS RS.11 ,21,00,000/-, RS.2,35,00,000/- AND RS.8,76,26,000/- RESPECTIVELY, WHICH MAKE THE TOTAL AT RS.22,32,26,000/-. AFTER CONSIDERING THE ANOTHER PA YMENT IN THE MONTH OF SEPTEMBER 1995, TOTAL OF COLUMN 1 COMES TO RS.12,80 ,00,000/- WHICH IS CONSIDERED AS INVESTMENT IN SHELA LAND IN THE CASE OF RADHE DEVELOPERS (INDIA) LTD. SIMILARLY, THE TOTAL OF COLUMN 2 REMAI NS AT RS.2,35,00,000/- AT THE END OF SEPTEMBER 1995 AND THIS IS THE PAYMENT BY CH EQUE FOR SHELA LAND DULY RECORDED IN THE BOOKS OF ACCOUNT RADHE DEVELOPERS ( INDIA) LTD. ON VERIFICATION, IT IS NOTICED THAT THE AMOUNT OF RS.1 2,80,00,000/- AS PER COLUMN 1 AND RS.2,35,00,000/- AS PER COLUMN 2 HAS BEEN CONSI DERED IN THE ASSESSMENT OF RADHE DEVELOPERS (INDIA) LTD. FOR THE BLOCK PERIOD. HOWEVER, THE TOTAL INVESTMENTS AFTER CONSIDERING ANOTHER PAY MENT OF RS.1,20,00,000/- IN THE MONTH OF SEPTEMBER 1995 AS PER COLUMN 3 COMES T O RS.9,96,26,000/- IN LAL BUNGALOW LAND. ON FURTHER VERIFICATION, IT IS F OUND THAT RS.3,75,00,000/- HAD BEEN ADDED IN THIS COLUMN MAKING THE TOTAL AT R S.13,71,26,000/-. SHRI ARUN B SHAH IN HIS STATEMENT DATED 14.03.96 VIDE AN SWER TO QUESTION NO. 75 HAD CLEARLY STATED THAT RS.3.75 CRORES HAVE BEEN AD DED ON THE SAID SEIZED PAPER BY SHRI ASHISH P PATEL IN HIS HANDWRITING BY PEN. THUS, IT IS CLEAR THAT THE ASSESSEE HIMSELF HAD WORKED OUT TOTAL INVESTMEN T IN LAL BUNALOW AT RS.13,71,26,000/- (COLUMN 3 OF SEIZED PAPER). THE A SSESSEE HAD RECORDED IN THE BOOKS OF ACCOUNT ONLY RS.8,34,30,000/- AND HENC E, THE BALANCE AMOUNT OF RS.5,36,96,000/- IS UNEXPLAINED. SINCE SHRI ASHISH PATEL IS THE MAIN FINANCIER OF THE INVESTMENT IN LAL BUNGALOW LAND, AND IS THE CHAIRMAN OF GANGA CO.OP. HOUSING SOCIETY, AND HE WAS CONTROLLING THE ENTIRE AFFAIRS OF THE SOCIETY, THE EXCESS INVESTMENT IS TREATED HIS UNDISCLOSED INCOME AND ADDED TO THE TOTAL INCOME FOR THE BLOCK PERIOD. EVEN AS PER THE TEST O F HUMAN PROBABILITY (SUMATI DAYALA 214 ITR 801 (SC)) AND PREVAILING PRACTICE IN THIS LINE OF BUSINESS (ROHINI RAMNATH LELE 117 CTR 208 (MUM.) (T.M.)), IN VESTMENT IN LAL BUNGALOW LAND IS TO BE CONSIDERED IN THE HANDS OF T HE ASSESSEE. ACCORDINGLY, AN ADDITION OF RS.5,36,96,000/- IS MADE IN THE A.Y. 1996-97. [ADDITION RS.5,36,96,000/- AS UNEXPLAINED INVESTM ENT] 25. WE HAVE HEARD BOTH THE SIDES AND GONE THROUGH T HE FACTS AND CIRCUMSTANCES OF THE CASE. WE FIND THAT THAT ASSESSEE IS THE CHA IRMAN OF GANGA CO-OPERATIVE SOCIETY AND ASSESSEE HAS ENTERED INTO AGREEMENT IN THE CAPACITY OF CHAIRMAN OF GANGA CO-OPERATIVE SOCIETY AND NOT IN HIS INDIVIDUA L CAPACITY. THE SOCIETY IS IT(SS)A NO.16/AHD/2007 B.P. 1-4-85 TO 31-3-95 & 1-4-95 TO 14-3-96 ASHISH P PATEL V. DCIT, CC-1(2) ABD PAGE 28 SEPARATE LEGAL ENTITY. WE FIND THAT AT THE TIME OF ORIGINAL ASSESSMENT PROCEEDINGS, AN ORDER OF ATTACHMENT OF IMMOVABLE FOR PLOTS SITUATED BEHIND NAVRANGPURA TELEPHONE EXCHANGE AND KNOWN AS LAL BUNGALOW LAND HAD BEEN AT TACHED VIDE ORDER DATED 14- 07-1997 FOR THE RECOVERY OF AMOUNT DUE FROM ASSESSE E. THE GANGA CO-OPERATIVE HOUSING SOCIETY LTD FILED PETITION UNDER RULE 11 OF THE SECOND SCHEDULE VIDE APPLICATION DATED 09-12-1997, WHEREBY IT WAS STATED THAT DEFAULTER ASHISH PATEL WAS ONLY PRESIDENT OF THE SOCIETY AND THE BANKHAT HAD B EEN SIGNED BY HIM FOR THE SOCIETY IN THE CAPACITY OF PRESIDENT AND THE AGREEMENT WERE NOT ENTERED INTO HIM IN HIS INDIVIDUAL CAPACITY. AFTER CONSIDERING THE STATEMEN TS RECORDED DURING THE COURSE OF SEARCH AND OTHER FACTUAL ASPECTS, TAX RECOVERY OFFI CER, RANGE-6, AHMEDABAD HAS PASSED AN ORDER UNDER RULE-11 OF THE SECOND SCHEDUL E OF THE ACT ON 04-05-1998 RELEASING THE PROPERTY LAL BUNGALOW BY MAKING OBSER VATIONS AT PAGE 5 OF HIS ORDER:- ON THE BASIS OF DOCUMENTS FILED, INFORMATION OBTAIN ED FROM THE SUB REGISTRAR AND DCIT SPECIAL RANGE-5 AHMEDABAD, PETITION OF THE SOCIETY IS ACCEPTED ON FOLLOWING POINTS:- 1. THE TITLE/OWNERSHIP OF THE PROPERTY IS WITH THE SUCCESSORS OF HATHISINGH HARGOVANDAS AND SRI HARSHVADAN HATHISINGH AND NOT W ITH THE DEFAULTER SHRI ASHISH PATEL. 2. THE POSSESSION OF THE LAND IS WITH ORIGINAL OWNE R AND NOT WITH DEFAULTER. 3. THE SOCIETY HAS INTEREST IN THE PROPERTY SINCE T HE LANDOWNER HAS MADE BANAKHAT (AGREEMENT FOR SALE) WITH THE SOCIETY AND SOCIETY HAS MADE PART PAYMENT OF PURCHASE VALUE. THE RIGHT FOR PURCH ASE OF PROPERTY IS WITH THE SOCIETY. 4. THE SOCIETY IS SEPARATE LEGAL ENTITY HENCE EVEN IF THE DEFAULTER HAS PROVIDED FUND FOR PURCHASE OF PROPERTY, FOR LEGAL P URPOSE, THE PROPERTY SHALL BE OF SOCIETY ONLY. 5. THE DEMAND IS IN THE CASE OF SHRI ASHISH P PATEL INDIVIDUAL AND NO R.C. HAS BEEN RECEIVED IN THE CASE OF SOCIETY. 6. THE DEPARTMENT WILL NOT BE IN A POSITION TO SALE /AUCTION THE PROPERTY SINCE THE TITLE/OWNERSHIP OF THE PROPERTY IS NOT IN THE NAME OF SHRI ASHISH P PATEL. IN VIEW OF WHAT IS STATED ABOVE, THE LD. COUNSEL FO R THE ASSESSEE STATED THAT TAX RECOVERY OFFICER HAS ACCEPTED THAT LAND OF LAL BUNG ALOW BELONGED TO GANGA CO- OPERATIVE HOUSING SOCIETY AND NOT TO THE ASSESSEE A ND ACCORDINGLY THE ATTACHMENT IT(SS)A NO.16/AHD/2007 B.P. 1-4-85 TO 31-3-95 & 1-4-95 TO 14-3-96 ASHISH P PATEL V. DCIT, CC-1(2) ABD PAGE 29 OF LAND WAS VACATED AND FURTHER STATED THAT IT CAN BE SEEN FROM ABOVE THAT EVEN DEPARTMENT HAS ACCEPTED THAT AFORESAID PROPERTY BEL ONGS TO GANGA CO-OPERATIVE HOUSING SOCIETY HENCE NO ADDITION CAN BE MADE IN TH E CASE OF ASSESSEE. EVEN THE ASSESSEE HAS CATEGORICALLY STATED THAT HE HAS NEVER STATED THAT THE PROPERTY OF LAL BUNGALOW LAND HAS BEEN PURCHASED BY HIM IN HIS INDI VIDUAL CAPACITY AND DURING THE COURSE OF SEARCH, A STATEMENT OF ASSESSEE WAS RECOR DED ON 15-03-1996 WHEREBY PAGE NO.106 SEIZED FROM FILE A-3 FROM RESIDENCE OF SHRI ARUN WAS SHOWN AND QUESTION OF 18(M) WAS ASKED TO, WHICH IS REPRODUCED HEREINUNDER:- Q. NO.18(M) PLEASE EXPLAIN THE CONTENTS OF COLUMN NO. III. IF YOU WANT, YOU CAN SEE THE BOOKS OF ACCOUNT OF ANY FIRM OR SOCIETY FOR EXPLAINING THE SAME. ANS. COLUMN NO. III CONTAINS THE DETAILS OF PAYMENT S MADE BY GANGA CO- OPERATIVE HOUSING SOCIETY (MONTHLY) FOR PURCHASE OF PROPERTY OF LAND NEAR LAL BUNGALOW TO VARIOUS PERSONS, APPROXIMATELY IN THOUS AND THAT IS 30500 MEANS 3,05,00,000 RS. 26. THE LD. COUNSEL FOR THE ASSESSEE BROUGHT TO OUR NOTICE, THE STATEMENT OF THE ASSESSEE RECORDED ON 15-04-1996 AND IN RESPONSE TO Q. NO.4, THE ASSESSEE HAS REPLIED THAT HE WAS CHAIRMAN OF GANGA CO-OPERATIVE HOUSING SOCIETY LTD. AND THE SOCIETY HAS MADE BANAKHAT OF 18000 SQ.YD. LAND WHIC H SITUATED BEHIND NAVARANGAPUR TELEPHONE EXCHANGE. FURTHER, DURING TH E COURSE OF RELEASE, FOR FURTHER CONFIRMATION SHRI ASHISH PATEL WAS SUMMONED UNDER RULE 83 OF THE SECOND SCHEDULE AND THE STATEMENT WAS RECORDED ON 07-04-19 98 ON OATH AND IN RESPONSE TO Q. NO.3 ASSESSEE HAS ACCEPTED THAT HE HAD VARIOU S AGREEMENT OF SALE AS WELL AS CERTAIN SALE DEEDS AS CHAIRMAN OF THE SOCIETY AND I N RESPONSE TO Q. NO.6, ASSESSEE HAD DENIED TO HAVE ANY PERSONAL RIGHT, TITLE, INTER EST, OWNERSHIP IN THE PROPERTY UNDER QUESTION. THE ASSESSEE FURTHER STATED THAT DURING T HE COURSE OF SEARCH, CERTAIN PAPERS WERE SEIZED FROM THE PREMISES OF ASSESSEE WH EREBY IN PAGE NO.18 OF ANNEXURE A-4, IT WAS WRITTEN THAT RS.,49,08,000/- H AS BEEN PAID TOWARDS LAL BUNGALOW LAND AND EVEN AFORESAID PAYMENT FOR ACQUIS ITION OF AFORESAID LAND HAS BEEN MADE BY GANGA CO-OPERATIVE HOUSING SOCIETY AND NOT BY ASSESSEE. THE SAID FACTS WERE EVEN CONSIDERED BY AO AT THE TIME OF ORI GINAL ASSESSMENT PROCEEDINGS AND, WHILE ADDITION OF RS.13,97,96,000/- FOR LAL BU NGALOW WAS MADE WHICH WAS NET OF AFORESAID PAYMENT RECORDED IN THE BOOKS OF SOCIE TY. WE, IN VIEW OF THE ABOVE FACTS, FIND THAT THE ORDER OF TAX RECOVERY OFFICER UNDER RULE-11 TOGETHER WITH STATEMENTS RECORDED OF ASSESSEE DURING THE COURSE O F SEARCH PROCEEDINGS, SEIZED IT(SS)A NO.16/AHD/2007 B.P. 1-4-85 TO 31-3-95 & 1-4-95 TO 14-3-96 ASHISH P PATEL V. DCIT, CC-1(2) ABD PAGE 30 MATERIAL AND PAYMENT RECORDED IN THE BOOKS OF ACCOU NT PROVES THE FACT THAT AFORESAID LAL BUNGALOW LAND WAS OWNED BY CO-OPERATIVE SOCIETY AND NOT BY ASSESSEE. FURTHER, ENTIRE BANAKHATS FOR AFORESAID LAND MADE B Y ASSESSEE WERE IN CAPACITY OF CHAIRMAN OF THE SOCIETY AND NOT IN HIS INDIVIDUAL C APACITY. IN VIEW OF SUCH FACTS, IF AO WISHES TO MAKE ANY ADDITION PERTAINING TO LAL BUNGA LOW, IT CAN BE MADE IN THE CASE OF GANGA CO-OPERATIVE SOCIETY LTD. AND NOT IN THE C ASE OF ASSESSEE. 27. WE FURTHER FIND FROM THE STATEMENT RECORDED ON 15-04-1996 WHICH WAS RELIED BY AO AT ORIGINAL ASSESSMENT PROCEEDINGS WHEREBY AS SESSEE HAS STATED THAT SOCIETY HAS PAID RS.21 CRORE TILL NOW BY CHEQUES AND CASH O UT OF WHICH RS.16 CRORES ARE UNACCOUNTED AND APPROXIMATELY RS.5 CRORE ARE UNACCO UNTED, ASSESSEE STATED THAT HE AT THE FIRST INSTANCE DURING THE COURSE OF SEARC H PROCEEDINGS, STATED AT Q.NO.18 OF STATEMENT RECORDED ON 14-03-1996 THAT HE HAD NOT MA DE ANY PAYMENT TO THE SOCIETY OR ANY OTHER PERSON IN CONNECTION WITH ACQUISITION OF DEVELOPMENT RIGHTS OF THE SOCIETY. HOWEVER, THE ASSESSEE WAS THEREAFTER ASKED BY ADI TO ADMIT OF GIVING OF RS.5 CRORES TO GAUTAM ADANI, AND ADDITION WOULD NOT BE MADE BECAUSE HE WOULD GET DEDUCTION OF THE SAID AMOUNT UNDER SEC.37 OF TH E ACT BEING EXPENDITURE IN THE COURSE AND PURCHASES OF THE BUSINESS. THE ASSESSEE WAS TOLD AT THE TIME OF SEARCH THAT IF HE ADMITS IN HIS STATEMENT THAT THE PAYMENT OF RS.5 CRORES WAS TO GAUTAM ADANI IN RESPECT OF HIS RIGHT ON THE LAND FROM THE ON-MONEY RECEIVED FROM HIS DIFFERENT SCHEMES LIKE RADHE CONSTRUCTION, RADHE AS SOCIATES AND RADHE ESTATE DEVELOPERS, HE WOULD GET THE DEDUCTION OF THE SAID AMOUNT OF RS.5 CRORES AS STATED HEREINBEFORE BEING EXPENDITURE U/S.37 OF THE ACT. T HE ASSESSEE RELYING ON THE UNDERSTANDING GIVEN BY THE AO SAID THAT HE HAD PAID CASH OF RS.5 CRORE TO GAUTAM ADANI THOUGH HE HAD DENIED FIRST AND IN FACT HE HAS NOT GIVEN RS.5 CRORE TO SHRI GAUTAM ADANI. MOREOVER, WHEN MORE THAN TWO ENTITIE S ARE INVOLVED, IT IS ALSO NOT LEGAL TO MAKE ADDITION IN THE ASSESSEES CASE. HOWE VER, THE ASSESSEE, FOR THE FIRST TIME, CAME TO KNOW WHEN HE RECEIVED A LETTER DATED 17-03-1997 THAT AO INTENDED TO ADD IT TO HIS INCOME AFORESAID AMOUNT. THE ASSESSEE THEREFORE FOUND THAT THE AO INTENDED TO GO AGAINST THE UNDERSTANDING GIVEN BY T HE AUTHORIZED OFFICER TO THE ASSESSEE ON THE BASIS OF WHICH HE HAD AGREED TO HAV E PAID RS.5 CRORE MADE A CORRECT STATEMENT OF FACT BY HIS REPLY DATED 20-03- 1997 WHICH IS ENCLOSED AS ANNEXURE HEREWITH. THE RELEVANT PAGE OF REPLY IS AL SO REPRODUCED HEREINUNDER:- IT(SS)A NO.16/AHD/2007 B.P. 1-4-85 TO 31-3-95 & 1-4-95 TO 14-3-96 ASHISH P PATEL V. DCIT, CC-1(2) ABD PAGE 31 10. PARA 8.1 AT THE INITIAL TIME OF RECORDING OF MY STATEMENTS WITH REFERENCE TO ONE OF THE PAPERS FOUND AND SEIZED IN RESPECT OF TH E LAND NR. LAL BUNGALOW, I HAVE CATEGORICALLY STATED THAT THE PAPERS SO PREPAR ED WERE PROJECTIONS TO AVAIL THE FINANCE FROM ARGIND GROUP. IT WAS ALSO STATED T HAT THESE ARE ESTIMATED FIGURES AND IN SOME OF THE CASES MORE AMOUNT IS PAI D AND IN SOME CASES NO AMOUNT IS PAID. (REFER ANS. NO.20 OF THE STATEMENT DATED 15/3/1996 AT 7 P.M.) LATER ON, THE SEARCH PARTY EXTRACTED CERTAIN CONFES SIONS FROM SHRI ARUN B SHAH, OUR LEGAL ADVISOR ON SOME OF THE PAPERS FOUND FROM HIS RESIDENCE. IT APPEARS THAT ON THE BASIS OF THE SAME THE SEARCH PA RTY FOUND THAT RADHE GROUP HAS PAID RS.12.80 CRORES AS A PREMIUM IN ACQU IRING THE DEVELOPMENT RIGHTS FOR THE SCHEME RADHE ACRES. DIFFERENT CALC ULATIONS, NOTINGS, PROJECTIONS, FIGURES ETC., WERE WRITTEN BY DIFFEREN T PERSONS ON VARIOUS PAGES AND ALSO ON SAME PAGES. THEREFORE, BY CORNERING ME A CONFESSION THAT AN AMOUNT OF RS.5 CRORES HAVING BEING PAID TO ONE SHRI GAUTAM ADANI TO SETTLE HIS RIGHTS FOR SOME OF HIS INTEREST WAS ALSO EXTRAC TED FROM ME. AT THE SAME TIME, I WAS GIVEN DIFFERENT IDEAS TO MAKE BELIEVE T HE STORY AS TRUE IN RESPECT OF THE PURPOSE FOR MAKING THE PAYMENT AND SOURCES THER EOF. ONE OF SUCH, WAS PERTAINING TO THE LAND OWNED BY SHRI VIJAY HUTHISIN G, A REPUTED BUSINESSMEN WITH WHOM A MAN OF GAUTM ADANIS STATUS COULD BE LI NKED UP AND THE SOURCES COULD BE ON MONEY COLLECTION MADE FROM VARIOUS SCHE MES WHICH WOULD BE ALLOWED AS REVENUE EXPENDITURE LIKE THE PREMIUM OF RS.12.80 CRORES PAID. IT WAS DURING THIS TIME, I HAD GATHERED THAT THE MAIN ALLEGATION FOR CONDUCTING THE SEARCH IN RADHE GROUP OF CASES WAS BECAUSE OF T HE STIFF RISE IN SHARE PRICE OF RADHE DEVELOPERS (INDIA) LTD., THE GROUP H AS MADE PROFIT RUNNING INTO CRORES OF RUPEES IN DEALING WITH THE SHARES. THE PR ICE OF THE SHARES AT ONE TIME HAS GONE AS HIGH AS RS.70 AGAINST THE FACE VAL UE OF RS.10. NOTHING INCRIMINATING INDICATING HAVING EARNED ANY AMOUNT O N ACCOUNT OF SHARE DEALINGS WAS FOUND, WHICH WAS IN FACT NOT EARNED. S HRI ARUN B SHAH FROM WHOM THE CONFESSION WAS EXTRACTED INITIALLY HAD MET WITH AN ACCIDENT JUST FEW WEEKS BACK, HAD A FRACTURED RIGHT HAND. SHRI ARUN B SHAH WHOSE STATEMENT WAS RECORDED HAS ALSO CONFIRMED THAT THE PAPERS SO PREPARED WERE PROJECTIONS TO AVAIL THE FINANCE FROM SOME PERSON. (REFER ANS. NO.76 OF HIS STATEMENT DATED 15/3/1996 RECORDED AT OFFICE PREMIS ES OF THE COMPANY). THE SEARCH PARTY KEPT ON PESTERING TO MAKE THE CONFESSI ON. IT LASTED AS LONG AS 36 HOURS AND I WAS MENTALLY AND PHYSICALLY TRIED AND E XHAUSTED AT THAT TIME. AS STATED EARLIER, THE PAPERS PREPARED WERE THE PROJEC TIONS TO AVAIL THE FINANCE FROM ARVIND GROUP. I HAVE CONTINUED ACCEPTING THE S AME AT THE TIME OF POST SEARCH INQUIRY TOO. THE FIANC RECEIVED FROM ARVIND GROUP WAS BY WAY OF ACCOUNT PAYEE CHEQUES ONLY AND THEREFORE, TO COVER UP THE SAME I WAS PERSUADED TO TAKE A STAND THAT THE ALLEGED CASH PAI D OF RS.5 CRORES WAS COLLECTED BY WAY OF CHARGING ON MONEY FROM OUR VARI OUS SCHEMES. I) I SAY AND STATE THAT I HAD NO SOURCE TO MAKE SUC H HUGE PAYMENT. NO PRUDENT BUSINESSMAN WILL ALSO MAKE PAYM ENT OUT OF HIS POCKET EVEN IF HE HAS THE FUND BECAUSE THE P ROPERTY IN QUESTION WAS NOT OWNED BY RADHE GROUP OF CONCERN NO R WE HAD ANY RIGHTS WHATSOEVER TO DEVELOP ETC. FROM THE SOC IETY. THE PROPERTY IN QUESTION WAS NOT CLEAR AND FREE FROM EN CUMBRANCES. VARIOUS LITIGATIONS WERE PENDING. IN FACT, I MYSELF IN MY CAPACITY IT(SS)A NO.16/AHD/2007 B.P. 1-4-85 TO 31-3-95 & 1-4-95 TO 14-3-96 ASHISH P PATEL V. DCIT, CC-1(2) ABD PAGE 32 AS A PARTNER OF M/S. RADHE CONSULTANCY INDIRECTLY A ND AS A CHAIRMAN OF M/S. GANGA CO-OP. HOUSING SOCIETY LTD., DIRECTLY WAS CONNECTED WITH THE ACTIVITIES FOR THE PROPERTY IN QUESTION OF M/S. GANGA CO-OP. HOUSING SOCIETY LTD. FOR RENDERIN G SERVICES ON BEHALF OF RADHE CONSULTANCY IN RESPECT OF THE AB OVE LAND, M/S. RADHE CONSULTANCIES WAS PAID A HUGE AMOUNT OF RS.1.40 CRORES BY WAY OF CHEQUES WHICH IS REFLECTED IN ITS BOOK. A COPY OF ACCOUNT FROM THE BOOKS OF M/S. RADHE CONSULTANCY IS ENCLOSED HEREWITH IN SUPPORT. II) AS REGARDS TO THE EXPLANATION FOR CALCULATING T HE RATE OF RS.20,000/- PER SQ.YD. HAVING BEEN INVESTED IN THE AFORESAID LAND WITH REFERENCE TO PAYMENT OF RS.5 CRORES, I SA Y AND STATE THAT I) FOR DISCUSSION MADE HEREINABOVE, NO SUCH PAYMENT WAS MADE. THEREFORE, THE SAME CANNOT BE TAKEN AS A BASE. II) ASSUMING WITHOUT CONCEDING THAT SHRI GAUTAM ADA NI HAD SOME INTEREST AND TO SETTLE HIS RIGHT, THE PAYMENT WAS M ADE. REST OF THE PROPERTY WAS ALSO NOT FREE FROM ENCUMBRANCES AN D ALSO THE LAND OWNED BY SHRI VIJAY HUTHEESING WAS NOT FREE FR OM ENCUMBRANCES AND ENCROACHMENT. IT WAS HAVING MORE L ITIGATIONS THAN THE OTHER LAND. VIZ. (I) THE LAND WAS DECLARED SURPLUS BY THE GOVERNMENT. (II) THE LITIGATION IS PENDING IN THE H IGH COURT. (III) THE COMPETENT AUTHORITY HAS REOPENED THE CASE TO RE VIEW FORM NO.1, CERTAIN PERSONS ERE HAVING ILLEGAL POSSESSION OVER THE PLOT. THEREFORE, NO SENSE IN HAVING PAID RS.5 CRORE S TO SOME OUTSIDERS, FOR HIS SO CALLED INTEREST. IN FACT, THE SOCIETY HAD PAID CERTAIN AMOUNTS AS PER ENCLOSED LIST TO THE PERSONS OCCUPYING THE PLOT ILLEGALLY. THE SOCIETY HAD PAID AND CONTIN UED TO PAY SUCH PERSONS FOR GETTING THE LAND VACATED, OBTAINING THE POSSESSIONS TO RESOLVE THE LITIGATIONS ETC. FOR ALL THE DISCUSSIONS MADE HEREINABOVE, THE UNIFO RM RATE OF RS.20,000/- PER SQ. YDS. CANNOT BE APPLIED FOR CALC ULATING THE INVESTMENTS. MOREOVER, THE ENTIRE LAND IS NOT FREE FROM ENCUMBRANCES, ENCROACHMENT, LITIGATIONS AND SLUM UP GRADATION IS NOT REMOVED, N.A. PERMISSION IS NOT YET GRANTED, PLANS ARE NOT APPROVED, NOC FROM THE COMPETENT AUTHORITY UNDER UR BANE LAND CEILING ACT IS NOT OBTAINED. THEREFORE, YOUR JUDGME NT SHOULD BE BASED AFTER TAKING INTO ACCOUNT ALL THE ABOVE. 11. PARA 8.2 THE ADDRESS OF THE PERSONS WHO ARE DIRECTLY KNOWN ARE AS PER LIST ENCLOSED. THE QUANTUM OF CORRECT AM OUNT IS AS PER MY STATEMENT RECORDED ON 14/03/1996. I HAVE ALS O NARRATED THE NATURE OF SUCH AMOUNT IN MY STATEMENT AS AND WH EN. 12. PAGE 9 . I HAVE BEEN ASKED TO FILE THE CONFIRMATION ACCOUN T FROM THE SAID PARTIES, I.E. SHRI MANOJ VADODARIA AN D SHRI VASANT ADANIT AND THEIR ASSOCIATES FOR THE PREMIUM PAID OF RS.12.80 IT(SS)A NO.16/AHD/2007 B.P. 1-4-85 TO 31-3-95 & 1-4-95 TO 14-3-96 ASHISH P PATEL V. DCIT, CC-1(2) ABD PAGE 33 CRORES. MY RELATIONS WITH THE ABOVE PARTIES ARE STR ANGE. THEREFORE, I AM U9NABLE TO FILE THE CONFIRMATION AC COUNT IN SUPPORT OF OUR CLAIM. THE SUPPORTING EVIDENCES ARE AVAILABLE IN FORM OF SEIZED PAPERS; STATEMENT RECORDED AND ALSO COPY OF AGREEMENT DATED 16/3/1995 SIGNED BETWEEN THE CHAIRMAN/SECRETARY OF THE SOCIETY AND MYSELF AS THE DIRECTOR OF THE COMPANY. I AM ENCLOSING A XEROX COPY OF THE SAM E ALONG WITH XEROX COPIES OF THE BYE-LAWS OF THE SOCIETY, X EROX COPY OF THE AGREEMENT TO SALE ENTERED BETWEEN THE SOCIETY A ND LAND LORD ON THE BASIS OF WHICH WE HAVE BEEN ASSIGNED THE RIG HTS. IN THIS REGARD, I AM DRAWING YOUR ATTENTION TO PAGE NO.3 OF THE APPLICATION FORMING PART OF THE SOCIETY RECORDS ENC LOSED. PERSONS AT SR. NO.1 AND SR. NO.10 ARE NONE OTHER TH AN SHRIO VASANT ADANI AND SHRI MANOJ VADODARIA. A PERUSAL OF XEROX COPY OF AGREEMENT TO SALE ENTERED BETWEEN THE LANDL ORD CRYSTALLIZES THE NAME OF SHRI VASANT ADANI AS CHIEF PROMOTER OF THE SOCIETY AND THE STATEMENT RECORDED OF SHRI SURE SH H SHAH U/S. 131 BY THE AUTHORIZED OFFICER IN POST SEARCH I NQUIRY AS PER OUR KNOWLEDGE. ALL THE ABOVE ARE CIRCUMSTANTIAL EVI DENCES WHICH BEYOND DOUBT PROVE THAT THEY WERE THE PERSONS WHO W ERE CONTROLLING THE SOCIETY AND THEREFORE, TH9E MONEY P ASSED ON AS A PREMIUM SHOULD BE ALLOWED AS BUSINESS EXPENDITURE . IN THE CASE OF RADHE DEVELOPERS (INDIA) LTD., I UNDERSTAND , THAT IF THOSE PERSONS DO NOT CONFIRM, ONE CANNOT PRESUME TH AT THE SAME WERE NOT PAID LIKEWISE, IT CAN ALSO BE PRESUME D, WE MIGHT HAVE FALSELY STATED THAT IT WAS PAID TO THEM BUT I N FACT WAS DIVERTED IN INVESTING IN SOME OTHER ASSETS. THERE WAS A THOROUGH SEARCH IN OUR GROUP, I.E. ALL THE DIRECTOR S, EMPLOYEES RESIDENCES ALONG WITH THEIR BUSINESS PREMISES WERE SEARCHED. NO EVIDENCE OF DIVERTING SUCH SUM IN OTHER ASSETS W AS ALSO FOUND. IN THIS CASE THE RIGHTS WERE ACQUIRED AND TH E PAYMENTS WERE MADE. THE SAME WAS NOT SO IN THE ALLEGED PAYME NT OF RS.5 CRORE TO SHRI GAUTAM ADANI AS NOTHING WAS ACHI EVED FROM HIM IN RESPECT OF THAT PROPERTY. THERE WAS NO NEXUS BETWEEN HIM AND LAL BUNGLOW PROPERTY DIRECTLY AND INDIRECTL Y. 28. IN VIEW OF AFORESAID FACTS, ASSESSEE STATES THA T HE IN FACT HAS NOT MADE ANY PAYMENT TO GAUTAM ADANI AND SAID FACT WAS CATEGORIC ALLY STATED DURING THE COURSE OF STATEMENT RECORDED ON 15-03-1996. WE FIND THAT THE ADDITION CANNOT BE MADE SOLELY ON THE BASIS OF THE STATEMENT OF THE ASSESSEE. THE ASSESSEE RELIES UPON THE DECISION OF ALLAHABAD HIGH COURT IN THE CASE OF ABDUL QAYUME V. CIT (1990) 86 CTR (ALL) P.66, WHEREIN IT IS HELD AS UNDER:- AN ADMISSION OR AN ACQUIESCENCE CANNOT BE A FOUNDA TION FOR AN ASSESSMENT, WHERE THE INCOME IS RETURNED UNDER AN ERRONEOUS IMP RESSION OR MISCONCEPTION OF LAW. IT IS ALWAYS OPEN TO AN ASSES SEE TO DEMONSTRATE AND IT(SS)A NO.16/AHD/2007 B.P. 1-4-85 TO 31-3-95 & 1-4-95 TO 14-3-96 ASHISH P PATEL V. DCIT, CC-1(2) ABD PAGE 34 SATISFY THE AUTHORITY CONCERNED THAT A PARTICULAR I NCOME WAS NOT TAXABLE IN HIS HAND AND IT WAS RETURNED UNDER AN ERRONEOUS IMPRESS ION OF LAW. THE SUPREME COURT IN THE CASE OF PULANGODE RUBBER PRODUCTS CO. LTD. V STATE OF KERALA AND ANOTHER (1973) 91 ITR IN PAGE 18, HAS HELD AS UNDER:- IT IS NOT DOUBT TRUE THAT ENTIRE IN THE ACCOUNT BO OKS OF THE ASSESSEE AMOUNT TO AN ADMISSION THAT THE AMOUNT IN QUESTION WAS LAID O UT OR EXPENDED FOR CULTIVATION, UP-KEEP OR MAINTENANCE OF IMMATURE PLA NTS FROM H NO AGRICULTURAL INCOME WAS DERIVED DURING THE PREVIOUS YEAR. AN ADM ISSION IS AN EXTREMELY IMPORTANT PIECE OF EVIDENCE, BUT IT CANNOT BE SAID THAT IT IS CONCLUSIVE. IT IS OPEN TO THE PERSON WHO MADE THE ADMISSION TO SHOW T HAT IT IS INCORRECT. WE FIND FROM THE ABOVE DECISION OF THE HONBLE ALLA HABAD HIGH COURT AND SUPREME COURT CLEARLY HOLDING THAT THE ADMISSION IS AN IMPO RTANT PIECE OF EVIDENCE BUT THE ASSESSMENT CANNOT BE MADE SOLELY ON THE BASIS OF AD MISSION. ADMISSION CANNOT BE THE FOUNDATION FOR ASSESSMENT. FROM THE ABOVE SAID TWO DECISIONS, IT IS CLEAR THAT IN CASE INCOME WAS SHOWN IN RETURN OF INCOME AND ENTR Y WAS IN ACCOUNTS, YET COURTS HELD ASSESSMENT CANNOT BE MADE SOLELY ON THAT REASO NS. EXCEPT ADMISSION, WHICH IS UNDER MISCONCEPTION AND INCORRECT, THERE IS NO OTHE R INDEPENDENT EVIDENCE TO SHOW THAT THE ASSESSEE HAS PAID RS.5 CRORE TO SHRI GAUTA M ADANI. THEREFORE, THE ADMISSION MADE UNDER SUCH CIRCUMSTANCES IS TO BE CO NSIDERED WITH GREAT CAUTION AND CIRCUMSTANCES IN WHICH THE ADMISSION WAS MADE P ARTICULARLY, UNDER THE TEMPTATION THAT IF ADMISSION IS MADE, IT WOULD BE A LLOWED AS EXPENDITURE AND THERE WOULD BE NO TAX EFFECT SHOULD BE SUPPORTED BY MATER IAL AND EVIDENCE. THE ASSESSEE THEREFORE CONTENDS THAT NO ADDITION CAN BE MADE ON THE BASIS OF STATEMENT RECORDED ON 15-04-1996, WHERE ASSESSEE HAS STATED THAT UNACC OUNTED PAYMENT OF RS.5 CRORE HAS BEEN MADE BUT FACT IS THAT NO SUCH PAYMENT HAS BEEN MADE. IN VIEW OF THESE FACTS, NOW WE WILL CONSIDER THE STATEMENT DATED 15- 04-1996, WHEREIN THE ASSESSEE STATED AT Q. NO.4 AS UNDER:- I AM CHAIRMAN OF M/S. GANGA CO.-OPERATIVE HOUSING SOCIETY LTD. THIS SOCIETY HAS MADE A BANAKHAT OF 180000 SQ. YARDS LAN D WHICH SITUATED BEHIND THE NAVRANGPURA TELEPHONE EXCHANGE. THE FINANCE FOR THE LAND HAS CAME FROM M/S. ARVIND MILLS LTD AHMEDABAD. NO SCHEMES HA S BEEN STARTED ON THIS LAND. WE HAVE NOT GET THE COMPLETE POSSESSION OF TH E LAND. ONLY WE HAVE GOT POSSESSION IN THE RANGE OF 30% TO 40%. WE HAVE PAID RS.21 CRORE TILL NOW BY CHEQUES AND CASH OUT OF WHICH RS.16 CRORES ARE ACCO UNTED AND APPROXIMATELY RS.5 CRORE ARE UNACCOUNTED. IT(SS)A NO.16/AHD/2007 B.P. 1-4-85 TO 31-3-95 & 1-4-95 TO 14-3-96 ASHISH P PATEL V. DCIT, CC-1(2) ABD PAGE 35 IT CAN BE SEEN FROM THE ABOVE FACTS THAT AT THE TIM E OF STATEMENT RECORDED DURING THE COURSE OF SEARCH ON 15-03-1996, ASSESSEE HAS CATEGO RICALLY DENIED THAT NO PAYMENT ON BEHALF OF AFORESAID CO-OPERATIVE SOCIETY WAS MAD E AND IN THE STATEMENT RECORDED AFTER THE PERIOD OF SEARCH AND PRESENT ASSESSMENT P ROCEEDINGS AND EVEN AFTER ONE MONTH ON 15-04-1996, AS HAS STATED, TILL THAT DATE, ASSESSEE HAS PAID UNACCOUNTED MONEY, EVEN IF ANY UNACCOUNTED PAYMENT IS MADE, SAM E IS MADE BETWEEN THE PERIOD OF 15-03-1996 I.E. AFTER THE DATE OF PRESENT BLOCK PERIOD AND BEFORE 15-04- 1996, HENCE EVEN IF ASSESSING OFFICER CAN MAKE ANY ADDITION, THAT CAN BE MADE IN REGULAR ASSESSMENT PROCEEDINGS AND NOT IN CURRENT B LOCK ASSESSMENT PROCEEDINGS. IN VIEW OF THE ABOVE FACTS AND DISCUSSIONS, WE ARE OF THE CONSIDERED VIEW THAT THIS ADDITION CANNOT BE MADE IN THE HANDS OF THE ASSESSE E AND ACCORDINGLY WE DELETE THE SAME. 29. IN THE RESULT, ASSESSEES APPEAL IS PARTLY ALLOWED. ORDER PRONOUNCED IN OPEN COURT ON 31/03/2010 SD/- SD/- (N.S.SAINI) (MAHAVIR SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER AHMEDABAD, DATED : 31/03/2010 *DKP COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT. 2. THE RESPONDENT. 3. THE CIT(APPEALS)- 4. THE CIT CONCERNS. 5. THE DR, ITAT, AHMEDABAD 6. GUARD FILE. BY ORDER, /TRUE COPY/ DEPUTY / ASSTT.REGISTRAR ITAT, AHMEDABAD