The DCIT, Central Circle-2(4), Ahmedabad V. Rajesh Mohanbhai Patel, Ahmedabad

ITSSA 168/AHD/2021

• Counselvise Citation: [2024] 100 COUNSELVISE.COM (IT) 4122 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 3 month(s) 27 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 30-01-2024
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Next Hearing Date: 21-11-2023
• Assessment Year: 2014-2015
• Appeal Filed On: 03-10-2021
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SHRIKAMLESHMAKWANA; C.I.TDR
• Assessee Lawyers: SHRIBIRENSHAH; IT SS ANO.AHDWITHOTHERS; THEAOWITHOUT

Judgement Text

आयकरअपीलीयअधिकरण , अहमदाबादनयायपीी INTHEINCOMETAXAPPELLATETRIBUNAL, ‘’C’’BENCH,AHMEDABAD BEFORESHRIWASEEMAHMED,ACCOUNTANTMEMBER And SHRITRSENTHILKUMAR,JUDICIALMEMBER Sr. No. IT(SS)ANo. Assessment Year NameofAppellantNameofRespondent 1-2. No.138& 139/Ahd/2021 2014-15 & 2015-16 RajeshMohanbhai Patel, 31,SujanBunglow, Nr.Shreyas Foundation, Ambawadi Ahmedabad-380006. PAN:AGCPP8630R TheAssistant Commissionerof IncomeTax, CentralCircle-1(2), Ahmedabad 3-4. No.168& 169/Ahd/2021 2014-15 & 2015-16 TheDeputy Commissionerof IncomeTax,Central Circle-2(4), Ahmedabad RajeshMohanbhai Patel, 31,SujanBunglow, Nr.Shreyas Foundation, Ambawadi Ahmedabad-380006. PAN:AGCPP8630R 5.No.68/Ahd/2021A.Y.2014-15 TheDeputy Commissionerof IncomeTax,Central Circle-2(4), Ahmedabad Ghanshyam MohanbhaiPatel, Prop.OfSuryam Developers,901, SuryaketuTowers,Nr. SambhavPress, JungesBunglow, Bodakdev, Ahmedabad-380015. PAN:ABBPP5403G Assesseeby:ShriBirenShah,A.R Revenueby:ShriKamleshMakwana,C.I.TDR सुनवाईकीतारीख /DateofHearing:22/11/2023 घोषणाकीतारीख /DateofPronouncement:31/01/2024 आदेश /ORDER PERBENCH: ThecaptionedappealshavebeenfiledattheinstanceoftheRevenueand theAssesseeagainsttheseparateordersoftheLearnedCIT(Appeals)-11, IT(SS)Ano.68/AHD/2021with3others A.Y.2014-15 2 Ahmedabad,arisinginthematteroftheassessmentorderpassedunders.143(3) r.w.s.153AoftheIncomeTaxAct,1961(here-in-afterreferredtoas"theAct"). 2.First,wetakeupIT(SS)No.138and168/AHD/2021,appealsbythe assesseei.e.ShriRajeshMohanbhaiPatelandtheRevenuefortheAY2014-15. TheissuesraisedbytheassesseeandtheRevenueareinterconnected,therefore wehavecombinedthesameforthesakeofbrevityandconvenience. 3.Thefactsinbriefarethattheassessee,anindividual,isengagedinthe activityoftradingoflandpropertyandshares/securities.Theassesseeforthe yearunderconsiderationdeclaredincomefromtradingactivitiesandother sourcesatRs.2,73,97,220/-only.Subsequently,asearchproceeding,dated4 th December2014,wascarriedoutattheassessee’spremises,andconsequently noticeundersection153AoftheActcametobeissuedupontheassessee.The assesseeinresponsetosuchnoticefiledreturnofincomeu/s153AoftheAct declaringincomeatRs.2,73,97,220/-only. 3.1Duringthesearchattheresidenceoftheassessee,certainloose papers/sheetsmarkedaspage33to41ofannexureA-1intheformofprinted copyofcomputerizeddatawasfound.Theimpugnedsheetcontaineddetailsof cashtransactions,beingcashreceiptandcashpaymentsfortheperiodpertaining toFYs2013-14and2014-15.Theamount,datesandnamesetc.werenotedin codedforminsuchimpoundedsheet.However,theAOdecodedthesameand accordinglyworkedouttheamountofcashpaymentsandreceiptfortheyear underconsiderationi.e.A.Y.2014-15atRs.9,36,64,261/-and8,59,80,251/- respectively. 3.2TheassesseebeforetheAOsubmittedthat,inhisstatementrecorded undersection132(4)oftheActdated31 st January2015,hehasexplainedthat impugnedloosesheets/papersfoundfromhisresidenceareroughpapersandhe IT(SS)Ano.68/AHD/2021with3others A.Y.2014-15 3 isnotawareofnotingmadeonthosepapers.Therefore,noinferenceshouldbe drawnfromthesepapersunlessanydirectorindirectconnectionisestablishedto hisauditedbooksofaccount. 3.3However,theAOfoundthattheloosesheets/paperswerefoundfromthe assessee’sresidence,thereforethepresumptionundersection292CoftheActis drawnthatthesamebelongstotheassesseeandcontentofthesamearetrue. Further,theimpugnedsheetswereprintedcopyofcomputerizeddatawherein cashtransactionwerenotedintheformofopeningbalance,cashin,cashoutand attheendtotalofcashinandcashout.Thesheetsalsocontaincheckmarksby thepencilasusuallydoneforaccountingchecks.Therefore,thesamecannotbe saidtobearoughnoting.Furthermore,thereiscorrelationofentriesrecordedon thosesheets,suchasthereisentrynotedas“GMPSingaporeExp”forRs.2.85 Lakhsason7 th June2014andontheotherhand,ShriGhanshayamMohanbhai PatelhasmadeinvestmentinSingaporebasedcompany.Thus,theexpense recordedforRs.2.85Lakhscorelates.Likewise,theassesseehascarriedouthis sharetradingactivitythroughthebrokernamelyNatrajShareBrokerandthe seizedloosesheetscontainstheentryofcashpaymentofRs.14,198/-on25-2- 2014toNatrajShareBroker. 3.4Thus,theAOinviewoftheaboveheldthattheloosesheetsfoundfrom theresidenceoftheassesseearenotroughnotingasclaimedbytheassesseebut thesamerepresentunaccountedcashreceiptsandpaymentsoftheassessee.The AOconsideringthefactsi.e.thecashpaymentsofRs.9,36,64,261/-ishigher thanthecashreceipt,heldthattheamountofcashpaymentistobeaddedtothe totalincomeoftheassesseeasunexplainedcashandaccordinglyaddedthesame. 4.TheaggrievedassesseepreferredanappealbeforethelearnedCIT(A). IT(SS)Ano.68/AHD/2021with3others A.Y.2014-15 4 5.TheassesseebeforethelearnedCIT(A)reiteratedthattheseizedpapers arenothingbutroughpapershavingnomeaning.Assuch,hemaintainsregular booksofaccountwhicharealsosubjecttoaudittherefore,hedoesnotneedto recordtransactionsonpaper. 5.1TheassesseefurthersubmittedthattheAOhasnotprovidedanybasisfor interpreting/decodingofcontentsrecordedonseizedpapers.TheAOinterpreted the‘GMP”notedonsuchpapersastransactionwithShriGhanshayambhai MohanlalPatelwhoisagoodfriend.Intheordinarycourseofbusiness,hehas advancesmoneytoShriGhanshayambhaiMPatelasandwhenrequiredon interest,butallthetransactionswerecarriedoutthroughbankingchanneland dulyrecordedinhisbooksofaccountsaswellasinbooksofShriGhanshayam BhaiPatel.Likewise,page34ofseizedpapercontainsanentryas“Insurance RangeRover22.1”againstwhichtheamountnotedas43.00.Bythelogicadopted bytheAO,theimpugnedentryistobeinterpretedasrangeroverinsurancepaid incashforRs.4300/-onlywhereasontheotherhand,theactualinsurance premiumofRangeRoverstandsatRs.2.05Lakhpaidthroughbankingchannel whichisdulyrecordedinbooks.Samepagealsocontain“JagguarInstallment” andtheAOinterpretedthatinstallmentofcarpaidincashoutsidebookswhereas carinstallmentregularlypaidthroughbankingchannelwhichwasdulyrecordedin books.Thus,theinferencedrawnbytheAObasedonloosepapersaremisplaced. Theassesseealsosubmittedthatnoworkingandthebasisofamountderivedby theAOhasbeenprovided. 5.2Theassesseefurthersubmittedthataftersearch,heenquiresfromhisstaff aboutseizedpapersbeinganofficeboywhowasalsodoingaccountingworkhas admittedthathehasmaintainedsuchroughnotingforaccountingpurpose.To thiseffecttheassesseesubmittedtheaffidavitofhisofficeboy. IT(SS)Ano.68/AHD/2021with3others A.Y.2014-15 5 6.ThelearnedCIT(A)afterconsideringfactsintotalitypartiallysustainedthe additionmadebytheAObyholdingthatonlynetofreceiptandpaymentwillbe subjectedtoaddition.TherelevantfindingsofthelearnedCIT(A)areextractedas under: 11.18Intheinstantcase,theAOhasnotmadeanyinquirytocorroboratehisconclusion. Hehasnotbotheredtoconfrontthepersons/partiesmentionedintheassessmentorder. 11.19FurtherasdiscussedinprecedingparasofthisorderandtoendofjusticewhenAO himselfhasmentionedonthebasisoftheentriesintheseizedpaperstheCashReceiptat Rs.8,59,80,251andCashexpensesofRs.9,36,64,261andthereisdifferenceof Rs.76,84,410/-representunexplainedexpenditurethereforenoadditioncouldbemade beyondRs.76,84,410/-.Infactontheloosepapertheamountsandnamesareincodes andafterdecodingaspertheAO'sobservationonlythenetincomeorexpenditurecould betaxedratherthantotheentireexpenditure.TheAOhasnotgivenanyreasonsin supportoftheadditionofthefullamountofcashexpenditure.Moreover,althoughthe nameandfiguresareincodesbutthecontentsnotedintheseizedpaperscannotbe deniedforthereasonthatsomeofthetransactionsfoundnotedintheseizedpapersare connectedwiththebooksofaccountsoftheappellant.Atthesametimethetelescopingof theexpensesagainstthereceiptscouldnotbedeniedinviewofthenatureofthebusiness ofappellantwhichislandtrading.TheAOhasnotgivenanyreasoningalsofornot grantingthesetoffoftheexpensesagainstreceipts.Alsoitwasnotlogicaltotaxthe grossreceipts/expenseswhichisagainsttheprincipleoftaxationofrealincomeandnot thegrossincomeasperthevariousjudicialpronouncements. 11.20Inviewoftheaboveitwouldbefairandreasonableiftheexcessofthecash expenditureoverthecashreceiptsisbroughttotaxbeingthepaymentoutofthe undisclosedincomeoftheappellantwhichworksouttoRs.76,84,410/-.Hence,by respectfullyfollowingthebindingdecisionsofhigherjudicialauthority,asstatedabove, theadditionofthefullamountofcashexpensesmadebytheAOisnotfoundlegally sustainable,hence,additionofRs.76,84,410/-isupheldandreliefisgrantedforthe balanceadditionatRs.8,59,79,851/-. Thisgroundsofappealarepartlyallowed 7.BeingaggrievedbytheorderofthelearnedCIT(A),boththeassesseeand therevenueareinappealbeforeus.Theassesseeisinappealagainstthe additionsustainedforRs.₹76,84,410/-whereastherevenueisinappealagainst theamountdeleted.Therelevantgroundofappealoftheassesseeandthe revenueinIT(SS)ANo.138and168/AHD/2021readsasunder: 8.TheAssesseehasraisedthefollowinggroundsofappeal: IT(SS)Ano.68/AHD/2021with3others A.Y.2014-15 6 1.Inlawandinthefactsandcircumstancesoftheappellant'scase,theLearned CommissionerofIncometax(Appeals)-11,Ahmedabad(hereinafterreferredas"CIT(A)") haserredinnotappreciatingthefactthattheassessmentorderpassedu/s143(3)r.w.s. 153C(1)(b)oftheIncome-taxAct,1961,bytheAssistantCommissionerofIncomeTax, CentralCircle-1(2)Ahmedabad,waswithoutjurisdiction,voidanditdeservedtobe quashed. 2.Inlawandinthefactsandcircumstancesoftheappellant'scase,theLd.CIT(A)has erredinsustainingtheadditionofRs.76,84,410/-basedonsomeloosepaperwhichisnot supportedbyanyevidenceandtherefore,thesameneedstobedeleted. 3.Inlawandinthefactsandcircumstancesoftheappellant'scase,theLd.CT(A)has erredindismissingtheappellant'sgroundofappealagainstchargingofinterestu/s.234A, 234B,234Cand234DoftheAct,whennosuchinterestischargeableinthecaseofthe appellant. 4.Inlawandinthefactsandcircumstancesoftheappellant’scase,theLd.CIT(A),has erredindismissingappellant’sgroundofappealagainsttheinitiationofpenalty proceedingsu/s.271(1)(c)oftheAct. 5.Theappellantcravesleavetoadd,amend,alterand/orwithdrawanygroundorgrounds ofappealeitherbeforeoratthetimeofhearingoftheappeal. 9.TheRevenuehasraisedthefollowinggroundsofappeal: 1.Onthefactsandinthecircumstancesofthecaseandinlaw,theLd.CIT(A),haserredin holdingthattheadditionofthefullamountofcashexpensesofRs.9,36,64,261/-madebythe AOisnotfoundlegallysustainableandtherebydeletingtheadditionofRs.8,59,79,851/- 2.Onthefactsandinthecircumstancesofthecaseandinlaw,theLd.CIT(A)oughttohave upheldtheorderoftheAO. 3.Itistherefore,prayedthattheorderoftheLd.CIT(A),besetasideandthatoftheA.Obe restoredtotheaboveextent. 10.ThelearnedARbeforeusfiledpaperbookrunningfrompages1to362and contendedthattheseizeddocumentswerepreparedbytheofficebywhowas alsoassistingtothemainaccountantforthepurposeofhisreference.Mostof suchentriesreflectedinsuchseizeddocumentsweredulyrecordedinthebooks ofaccounts.Furthermore,theRevenuehasnotbroughtanycorroborating materialsjustifyingthattheseizedmaterialsareofanincriminatingnature.Asper theld.ARtheseizeddocumentsrepresentingroughjottingsandnotingscannot beassumedasincriminatingnaturegivingrighttotherevenueauthoritiesfor calculatingtheundisclosedincome. IT(SS)Ano.68/AHD/2021with3others A.Y.2014-15 7 11.Ontheotherhand,thelearnedDRbeforeuscontendedthattheseized documentswererecordedinsystematicmannerandthereforethesamecannotbe referredtoasdumbdocument.Furthermore,thecontentsoftheseized documentsarepresumedtobetrueandlikewisethereisalsopresumptionthat seizeddocumentsbelongtotheassesseeonly.Assuchtheassesseehasnot dischargedtheonusbasedonthematerialsthattheseizeddocumentsaredumb documents. 12.BoththelandedARandtheDRbeforeusvehementlysupportedtheorder oftheauthoritiesbelowasfavourabletothem. 13.Wehaveheardtherivalcontentionsofboththepartiesandperusedthe materialsavailableonrecord.Inthepresentcase,theadditionhasbeenmadeby theAObasedonthedocumentsseizedduringthesearchproceedings.Assuch, theAObasedontheseizeddocumentsfoundthattheassesseeduringtheFYs 2013-14and2014-15hasindulgedintotheactivityofcertainunaccounted receiptsandunaccountedpayments.AspertheAO,theunaccountedreceiptand unaccountedpaymentoverthereceiptrepresenttheunexplainedincomeofthe assesseeunderprovisionsofsection68or69oftheAct.Inotherwords,the greaterofthereceiptorthepaymentwastreatedasunexplainedincomebythe AOandaccordinglyanadditionofRs.9,36,64,261/-wasmadeintheyearunder considerationandRs.3,56,84,434/-wereaddedinthenextyear.However,the learnedCIT-Aheldthatonlythenetofreceiptandexpenditurecanbemade subjecttotheadditions.Thus,thelearnedCIT-Aworkedoutthenetamountof₹ 76,84,410/-fortheyearunderconsiderationandRs.16,80,038/-fornextyearand confirmedtheadditiontotheextentofnetamountonly.Against,thefindingof theld.CIT-A,boththeRevenueandtheassesseeareinappealbeforeus. IT(SS)Ano.68/AHD/2021with3others A.Y.2014-15 8 13.1Aftergoingthroughtheassessmentorder,findingoflearnedCIT-Aandthe argumentsadvancedbytheld.ARandtheld.DR,whichhavebeenelaboratedin theprecedingparagraph,the1 st controversyarisesforouradjudicationwhether thedocumentsimpoundedduringthesearchrepresentsthedumbdocumentsand thereforebasedonthesamenoadditioniswarrantedinthegivenfactand circumstances.Inthisregard,wehaveperusedthedocumentsimpoundedduring thesearchandnotescertainglaringfactsasdetailedbelow: i.ThesearerecordedinasystematicmannerinExcelform. ii.Inmanycases,thedatesareappearing. iii.Thereareappearingtotalreceiptsandpaymentswiththeclosingbalances. iv.Theentriesreflectedintheimpoundeddocumentsarewrittenincoded form. v.Thereareseveralentrieswrittenincodedwordas“GM”whichwere assumedbytheAOasShriGhanshayamMohanbhaiPatel,aclosefriend oftheassesseehavingseveraltransactionsenteredwiththeassessee. vi.Sheetsalsocontainentrieswithrespecttocarsuchinsurance,carrepair, andparking vii.Therewereseveralentriesasinterestandcommissioninpaymentsideto differentpartieswhosenameswereincodedform. 13.2Fromtheconjointreadingoftheabovefacts,itistranspiredthatthese documentscontaincertainrelevantinformationwhichshouldbemeaningful.But thedifficultyisthatalltheentriesarewritteninthecodedformandthereforethe samerequirestobedecodedinscientificandmeaningfulmannersoastodrawa logicalinferencebasedontheseentriesrecordedintheimpoundeddocuments. Certainly,theprimaryonusliesupontheassesseetoexplaintheentriesina meaningfulmanner. 13.3Theprimarycontentionoftheassesseeisthattheseseizeddocuments weredumbdocumentswhichwerepreparedbyhisofficeboy,involvedin IT(SS)Ano.68/AHD/2021with3others A.Y.2014-15 9 accountingwork,forthepurposeofhisreference.Tothiseffect,theaffidavitof theaccountantwasalsofurnishedwhereinitwasexplainedasunder: As,Iwasassistingtomainaccountantthereforethesesheetswerehelpfultomein rememberingthetransactionandatthetimeoffinalizationofaccounts. ThatthesesheetsaremaintainedinaroughmannersothatIcannotforgetanythingtobe endorsedatthetimeofaccountingtothemainaccountant.Thus,thesesheetswere provisionalandnotfinalone. Afterfinishingtheaccountingoftheamountsenumeratedinthesheetsintotherespective ledgers,IusedtodestroyitasthesamearebeingenteredintheaccountsofShri RajeshbhaiPatel. Thatthesheetsmaintainedbymewereformyownpurposeanditwasnothingbutrough papersformypersonalease. 13.4Likewise,apaperbookcontainingpagesfrompages68to362wasalso preparedexplainingeachandeveryentryrecordedintheimpoundeddocuments. Buttheironyisthisthatnoneoftheauthoritiesbelowhasgoneinthe understandingoftheexplanationfurnishedbytheassessee.Inotherwords,the explanationfurnishedbytheassesseehasnotbeenverifiedeitherbytheAO/ld. CIT-Aduringtheassessmentproceedingsorduringtheappellateproceedings. Thus,intheabsenceofsuchverification,noinfirmityintheexplanationfurnished bytheassesseewaspointedoutbytheauthoritiesbelow.Accordingly,aquestion strikestoourmindwhetherweshouldsetasidethemattertothefileofanyof theauthoritiesbelowforthenecessaryverification.Beforedoingso,inthe interestsofjusticeandfairplayandtoavoidmultipleproceedings,wethoughtfit toverifythecontentsoftheexplanationfurnishedbytheassesseeintheformof paperbookonrandombasis.Onverificationoftheexplanationfurnishedbythe assessee,wefindthatmostoftheentriesreflectedintheimpoundeddocuments wereclaimedtobecarriedoutthroughthebankingchannelwhichwereduly disclosedinthebooksofaccountmaintainedbytheassesseeandauditedunder section44ABoftheAct.Inourconsideredview,theentrieswhichhavebeen carriedoutthroughthedisclosedbankaccountsorotherentriesdulyrecordedin thebookscannotbeconsideredasincomebasedonimpoundeddocuments.As suchtheentriesappearinginthebankstatement,dulyrecordedinbooks,the sameshouldbemadesubjecttoverificationaspertheprovisionsoflaw IT(SS)Ano.68/AHD/2021with3others A.Y.2014-15 10 independentoftheseizeddocuments.Assuch,noadverseinferencecanbe drawnaboutsuchentriesrecordedintheimpoundeddocumentswhichwere carriedoutthroughthebankingchannelanddulyrecordedinauditedbooksof account. 13.5Likewise,thesomeoftheentriescontainedintheseizedpapernot explainedbytheassesseeandwhichdonotgivetothemeaningfulinferenceafter decoding,thesamecannotbemadesubjecttotheadditionsuntilandunless thesearenotcorroboratedbysomematerialinformation.EventheCBDTtimeto timehasdiscouragetheassessingauthoritytomakeadditioninarbitrarymanner orbasedonstatementorsurrenderduringthecourseofsearch/survey.Inthis regardtheinstructionsissuedbytheCBDTinF.NO.286/2/2003-IT(Inv.11)dated 10-03-2003andF.NO.286/98/2013-IT(Inv.11)dated09-01-2014wouldbe relevanttobelookedinto.FurthertheHigherJudicialforumhastimeandagain heldthatthenoadditionmerelyonthebasisofnotingindiary/loosepaperetc. canbemadeunlessothercorroborativematerialbroughtonrecordbythe revenuetoholdthattheassesseeearnedunaccountedincome.Inthisregard referencecanbemadetojudgmentofHon’bleGujaratHighcourtinthecaseof CITvs.MaulikkumarKShahreportedin307ITR137whereinitwasheldthat: “Notingsintheseizeddiaryfoundfromthepremisesweretheonlymaterialonthebasisof whichtheAssessingOfficerhadmadetheimpugnedadditions.TheAssessingOfficerhad notbroughtanycorroborativematerialonrecordtoprovethatsuchsalesweremadeand 'on-money'wasreceivedbytheassesseeoutsidethebooksofaccount.TheAssessing Officerhadnotexaminedanypurchasertowhomthesalesofshopswereeffected.Onus heavilylayontherevenuetoprovewithcorroborativeevidencethattheentriesinthe seizeddiaryactuallyrepresentedthesalesmadebytheassessee.Suchonushadnotbeen dischargedbytherevenue.Mereentriesintheseizedmaterialwerenotsufficienttoprove thattheassesseehadindulgedinsuchatransaction. TheinferenceoftheAssessingOfficerthattheassesseehasreceived'on-money',was merelybasedonsuspicionandsurmisesandtherewasnomaterialwhatsoevertosupport theconclusionoftheAssessingOfficerthattheassesseehadinfactreceivedany'on- money'.TheadditionasmadebytheAssessingOfficerbeingbasedonmerepresumptions andassumptionsandwithoutanycorroborativeevidence,couldnotbesustained. 13.6WealsodrawsupportandguidancefromtheorderofMumbaiITATincase ofDCITvs.PadmasreeDRD.Y.PatilUniversityinITANo.3264to IT(SS)Ano.68/AHD/2021with3others A.Y.2014-15 11 3668/Mum/2022wherewithrespecttoevidentiaryvalueofloosepaperfoundin thecourseofsearchwasheldasunder: 30.InthedecisionrenderedbyHon’bleSupremeCourtinthecaseofCommonCause(a registeredsociety)reportedin394ITR220,itwasheldthatthedocumentsrecoveredby theauthoritieswillhavenoevidentiaryvalueunlessitiscorroboratedwithanyother independentevidence,i.e.,uncorroboratedloosepapersfoundinthesearchcannotbe takenassolebasisfordeterminationofundisclosedincome.TheHon’bleSupremeCourt hasheldinthecaseofCBIvs.VCShukla(supra)thatevencorrectandauthenticentries inbooksofaccountcannotfixaliabilityuponapersonwithoutindependentevidenceof theirtrustworthiness.WenoticethattheHon’bleSupremeCourthasdealtwiththeentries madeinadiarywhichwasconsideredtoberegularbooksofaccountandheldthatit cannotbereliedupon.However,intheinstantcase,theevidencesrelieduponbytheAO arecertainabstractstatementsmaintainedbytheemployeesintheirrespectivelaptops. Hence,inourview,itcannotbesaidthatthoseuncorroboratedmaterialshaveany evidentiaryvalueviz-a-vistheassesseeunlessanyotherindependentmaterialisbrought onrecordtoprovethetrustworthinessofthoseabstractinformation. 13.7Atthisjuncture,itisequallyimportanttorefertheprovisionsofsection 132(4A)and292CoftheActwhichprovidesapresumptionthatthedocuments impoundedfromthepremisesoftheassesseebelongstotheassesseeandthe contentsofthesamearetrue.However,suchpresumptionisrebuttableand assesseeonbasisofevidencecanrebutthesame.Eventhoughtheprovisionof section292Cand132(4A)oftheActprovidespresumptiontotheassessing authoritytopresumethatthedocumentbelongtotheassesseeandcontentare trueaboutthedocumentsfoundfromthepossessionoftheassesseebutthat doesnotmeanthatsuchdocumentsshallbebroughtunderthetaxnet.Totax incomebasedonloosesheets,itisnecessarytobringfindingonrecordthat notingmadeinsuchdocumentsareactualtransactionswhichhasmaterialized leadingtoincomeinthehandoftheassesseeandsuchincomehasbeen unaccountedorunexplainedbytheassessee.Inthecaseonhand,theassessee hasexplainedthattheofficeboyhasmaintainedsuchsheetinordertoassist mainaccountantatthetimeofaccounting.Theassesseehasfurnisheddetails showingthemajorityofthenotingsinthosesheetswerealreadyrecordedinthe auditedbooksofaccounts.Therefore,inconsideredview,makingadditionbased onsuchdocumentwillleadtodoubleadditioninthehandoftheassesseeforthe IT(SS)Ano.68/AHD/2021with3others A.Y.2014-15 12 reasonthatsamearealreadypartofbooksofaccountonwhichassesseehas offeredincome.Thus,inviewoftheaboveandafterconsideringthefacts,we holdthatnoadditionisliabletomemadeinthegivenfactsandcircumstances basedonseizedmaterials.Hence,thegroundofappealoftheassesseeisallowed whereasthegroundofappealoftheRevenueisherebydismissed. 13.8Intheresult,theappealoftheassesseeisallowedwhereastheappealof theRevenueisherebydismissed. ComingtoIT(SS)No.139and169/Ahd/2021appealsbytheassessee i.e.ShriRajeshMohanbhaiPatelandbytherevenuefortheAY2015-16 14.Attheoutset,wenotethattheissuesraisedbytheassesseeandthe revenueinitsgroundsofappealfortheAY2015-16areidenticaltotheissue raisedbytheassesseeandtherevenueinIT(SS)ANo.138&168/AHD/2021for theassessmentyear2014-15.Therefore,thefindingsgiveninIT(SS)ANo.138& 168/AHD/2021shallalsobeapplicablefortheassessmentyears2015-16.The appealoftheassesseeandtherevenuefortheA.Y.2014-15hasbeendecidedby usvideparagraphNo.13ofthisorderinfavouroftheassesseeandagainstthe Revenue.ThelearnedARandtheDRalsoagreedthatwhateverwillbethe findingsfortheassessmentyear2014-15shallalsobeappliedfortheassessment years2015-16.Hence,thegroundofappealfiledbytheassesseeishereby allowedandbytherevenueisherebydismissed. 15.Intheresult,theappealoftheassesseeisallowedwhereastheappealof theRevenueisherebydismissed. ComingtoIT(SS)ANo.68/Ahd/2021anappealbytherevenueinthe caseassesseenamelyShriGhansayamMohanbhaiPatel. IT(SS)Ano.68/AHD/2021with3others A.Y.2014-15 13 16.TheRevenuehasraisedfollowinggroundsofappeal: 1.Onthefactsandinthecircumstancesofthecaseandinlaw,theLd.CIT(A)haserred innotconsideringthefactthattheassesseewascoveredvidewarrantu/s132oftheAct, whereassessmentwasframedu/s153AoftheAct? 2.Onthefactsandcircumstancesofthecaseandinlaw,theLd.CIT(A)erredinholding thatlawdoesnotallowuseofdocuments/statementetc.foundandseizedfromthirdparty andnotfromassessee'sownsearchforthepurposeofassessmentu/s.153AoftheAct. 3.Onthefactsandcircumstancesofthecaseandinlaw,theLd.CIT(A)erredindeleting additionofRs.2,53,66,800/-madebytheAssessingOfficerontheissueofunaccounted cashtransaction. 4.Onthefactsandinthecircumstancesofthecaseandinlaw,theLd.CIT(A)oughtto haveupheldtheorderoftheA.O. 5.Itis,therefore,prayedthattheorderoftheLd.CIT(A)besetasideandthatoftheA.O. berestoredtotheaboveextent. 17.TheinterconnectissueraisedbytherevenueisthatthelearnedCIT(A) erredindeletingtheadditionofRs.2,53,66,800/-madeonaccountof unaccountedcashtransactiononmeritaswellasonlegalgrounds. 18.Thefactsinbriefarethattheassesseeisanindividualwhoclaimedtobe engagedinthebusinessofrealestate.Theassesseewassubjecttosearch proceedingundersection132oftheActdated4 th December2014and consequencetosearch,theproceedingundersection153AoftheActwasinitiated. TheassesseefiledreturnofincomedeclaringincomeofRs.1,76,93,932/-as declaredintheoriginalreturnfiledundersection139oftheAct. 18.1TheAOduringtheassessmentproceedingfoundthatcertainloosesheets containingunaccountedcashtransactionwerefoundattheresidenceofShri RajeshMohanbhaiPatel.Theimpugnedsheetsalsocontaintransactions pertainingtothepresentassessee.Thedetailsofsuchtransactionsareproduced bytheAOonpage6ofhisorder.Accordingly,theAOmadeadditionofRs. 2,53,66,800/-tothetotalincomeoftheassesseebyobservingasunder: IT(SS)Ano.68/AHD/2021with3others A.Y.2014-15 14 I,therefore,holdthatthecashreceiptRs.23900000/-representassesseeincomefrom undisclosedsourceofincomeaspertheprovisionofsection68oftheI.TAct.Similarly, theexcesscashpaymentsinrelationtocashreceiptsRs.14,66,800/-represent unexplainedinvestmentfromundisclosedsourceoftheasseseeutilizedforsuchpayments, thesourceofwhichisnotexplained.Accordingly,anadditionofRs.2,53,66,800/-madeon thisissue. 19.TheaggrievedassesseepreferredanappealbeforethelearnedCIT(A). 19.1ThelearnedCIT(A)afterconsideringthefactsintotalitydeletedthe additionmadebytheAOonthelegalgroundbyholdingthatnoincriminating materialwhatsoeverwasfoundontheassessee’spremises.Thematerialsreferred bytheAOwerefoundfromthepremisesofthirdpartynamelyShriRajesh MohanbhaiPatelwhichwasutilizedagainsttheassesseebytheAOwithout followingtheprovisionofsection153CoftheAct. 19.2ThelearnedCIT(A)alsodeletedtheadditionmadebytheAOonthemerit byobservingasunder: 8.1WithregardtothegroundofappealNo.2onmerits,theappellantcontendedthatheis regularlymaintainingbooksofaccountsandalsoproducedcompletedetailsoftransaction duringthecourseofremandproceedings,thereisnodisputeoverthegenuinetransaction betweenRajeshMPatelandGhanshyamMPatel.Theappellantcontendedfurtherthatthe documentsseizedfromthepremisesofthirdpartyarenotbindinguponhimas presumptionu/s.292Cisnotapplicableinrespectofdocumentsfoundfromthirdparty premises.ThedocumentsfoundatthepremisesofRajeshMPateldonotcontainnameof theappellantandthesamearenotinthehandwritingoftheappellantandnotsignedby theappellantorbyanyoneonherbehalf.Insuchcircumstances,usingthesedocuments againsttheappellantisunjustified.Theappellantcitedseveralcaselawsinwhichithas beenheldthatthedocumentsfound 8.1WithregardtothegroundofappealNo.2onmerits,theappellantcontendedthatheis regularlymaintainingbooksofaccountsandalsoproducedcompletedetailsoftransaction duringthecourseofremandproceedings,thereisnodisputeoverthegenuinetransaction betweenRajeshMPatelandGhanshyamMPatel.Theappellantcontendedfurtherthatthe documentsseizedfromthepremisesofthirdpartyarenotbindinguponhimas presumptionu/s.292Cisnotapplicableinrespectofdocumentsfoundfromthirdparty premises.ThedocumentsfoundatthepremisesofRajeshMPateldonotcontainnameof theappellantandthesamearenotinthehandwritingoftheappellantandnotsignedby theappellantorbyanyoneonherbehalf.Insuchcircumstances,usingthesedocuments againsttheappellantisunjustified.Theappellantcitedseveralcaselawsinwhichithas beenheldthatthedocumentsfoundfromthepremisesofthirdpartycannotbemade basisformakingadditionsinthehandsoftheappellant.Thesefactsshowthattheloose papersfoundthepremisesofShriRajeshMPatelisnotreliable.Keepinginviewtheabove discussion,theadditionsmadebytheAOconsideringtheGMasGhanshyambhaiMPatel IT(SS)Ano.68/AHD/2021with3others A.Y.2014-15 15 shownintheloosepapersfoundandinvolvementofappellantinthesaidtransactionon pureguessworkandpresumptionisnotgenuineandnotfoundlegallyandfactually unsustainableforthereasonsmentionedabove,hence,additionsmadebytheAOat Rs.2,53,66,800/-aredeletedonmeritsalso. 20.BeingaggrievedbytheorderofthelearnedCIT(A),theRevenueisin appealbeforeus. 20.1BoththelandedARandtheDRbeforeusvehementlysupportedtheorder oftheauthoritiesbelowasfavourabletothem. 21.Wehaveheardtherivalcontentionsofboththepartiesandperusedthe materialsavailableonrecord.Admittedly,theassesseewassubjecttosearch proceedingsundersection132oftheAct.Subsequently,theAOframedthe assessmentorderundertheprovisionsofsection153AoftheAct.However,we notethattheAOhasrecordednowherethatanymaterialwhatsoeverwasfound ontheassessee’spremises,whichshouldhavemadeabasisforassessment undersection153AoftheAct.Assuch,theseizedmaterialreferredbytheAOfor makingassessmentinthehandsofthepresentassesseewerefoundatthe residenceofShriRajeshMohanbhaiPatel.Therefore,suchmaterialcannotbe utilizedagainsttheassesseeunlesstheconditionsprecedentundersection153C oftheActarefollowedbytheRevenue. 21.1Bethatasmaybe,we,intheabovecaseofShriRajeshMohanbhaiPatel, haveheldthattheseizeddocumentsarewithoutanycorroborativematerials,so noadditioniswarrantedinthegivencaseaswell.Furthermore,mostofthe entriesrecordedinsuchdocumentswerealreadyrecordedinthebooksof accountsofShriRajeshMohanbhaiPatel.Likewise,thesamedocumentswere alreadyusedforthepurposeofadditioninthehandsofShriRajeshMohanbhai Patel.Assuch,thefactsofShriRajeshMohanBhaiPatelbeingidenticaltothe factsofthecaseonhand,sonoadditioniswarrantedinviewofthefindinggiven inPara12ofthisorder.HencethegroundofappealoftheRevenueisdismissed. IT(SS)Ano.68/AHD/2021with3others A.Y.2014-15 16 22.Intheresult,theappealoftheRevenueisherebydismissed. 23.Inthecombinedresultalltheappealsoftheassesseeareallowedwhereall theappealsoftheRevenueareherebydismissed. OrderpronouncedintheCourton31/01/2024atAhmedabad. Sd/-Sd/- (TRSENTHILKUMAR)(WASEEMAHMED) JUDICIALMEMBERACCOUNTANTMEMBER (TrueCopy) Ahmedabad;Dated31/01/2024 Manish