M/S. PHOENIX LEISURE AND LIFESTYLE PVT. LTD., Indore V. THE ACIT3(1), Indore

ITSSA 195/IND/2013

• Counselvise Citation: [2016] 122 COUNSELVISE.COM (IT) 2005 (ITAT-INDORE)
• Duration Of Justice: 2 year(s) 10 month(s) 3 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 18-05-2016
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: DB
• Next Hearing Date: 07-09-2015
• Assessment Year: 2008-2009
• Appeal Filed On: 15-07-2013
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: RAJEEV VARSHNEY; R A VERMA DRS
• Assessee Lawyers: ARPIT GAUR CAS
• Keywords: Unexplained cash credit; Unexplained expenditure; Business income; Depreciation; Income from undisclosed sources; Search and seizure; Loose papers; Document seized; Principle of natural justice; Deemed to accrue or arise in india; Additional evidence; Documents seized; Unabsorbed depreciation
• Section: 69C; 68; 145; 132; 15; 139

Judgement Text

PHOENIX LEISURE AND LIFESTYLE (SS)195 OF 2013 AND OTHERS 1 IN THE INCOME TAX APPELLATE TRIBUNAL INDORE BENCH, INDORE BEFORE SHRI D.T. GARASIA, JUDICIAL MEMBER AND SHRI B.C. MEENA, ACCOUNTANT MEMBER IT(SS)A NOS. 195 & 196/IND/2013 A.YS. 2008-09& 2009-10 PHOENIX LEISURE & LIFESTYLE PVT. LTD., INDORE PAN AAECP 9625 K :: APPELLANT VS ACIT-3(1), INDORE :: RESPONDENT IT(SS)A NOS. 254, 255/IND/2013& ITA NO.565/IND/2013 A.YS. 2008-09, 2009-10 &2010-11 DCIT-3(1), INDORE :: APPELLANT VS PHOENIX LEISURE & LIFESTYLE PVT. LTD., INDORE PAN AAECP 9625 K :: RESPONDENT ASSESSEE BY SHRI ANIL KAMAL GARG AND SHRI ARPIT GAUR, CAS RESPONDENT BY SHRI RAJEEV VARSHNEY AND SHRI R.A. VERMA, DRS DATE OF HEARING 05.04.2016 DATE OF PRONOUNCEMENT 18.05.2016 O R D E R PHOENIX LEISURE AND LIFESTYLE (SS)195 OF 2013 AND OTHERS 2 PER SHRI D.T.GARASIA, JM THE ABOVE APPEALS ARE FILED BY THE ASSESSEE AND REV ENUE CHALLENGING THE DIFFERENT ORDERS OF LD. CIT(A)-I, I NDORE FOR THE ASSESSMENT YEARS 2008-09 TO 2010-11. ASSESSEES APPEAL NO. : 195/IND/2013 A.Y. 2008-09 1. THAT, ON THE FACTS AND IN THE CIRCUMSTANCES OF T HE CASE, THE LEARNED CIT(A) GROSSLY ERRED IN UPHOLDING THE VALIDITY OF THE ASSE SSMENT PROCEEDINGS U/S. 153C OF THE INCOME-TAX ACT, 1961, FOR THE ASSESSMENT YEA R UNDER CONSIDERATION, WITHOUT APPRECIATING THE MATERIAL FACT THAT THE ORI GINAL ASSESSMENT PROCEEDINGS FOR THE ASSESSMENT YEAR UNDER CONSIDERATION HAD ATT AINED FINALITY AND THEREFORE IN ABSENCE OF SEIZURE OF ANY MONEY, BULLION, JEWELLERY , OTHER VALUABLE ARTICLES OR THINGS OR BOOKS OR OTHER DOCUMENTS, BELONGING TO TH E APPELLANT, INDICATING ANY UNDISCLOSED INCOME OF THE APPELLANT FOR THE RELEVAN T ASSESSMENT YEAR, DURING THE COURSE OF SEARCH U/S. 132(1) CARRIED OUT IN OTHER C ASES, THE LEARNED AO WAS NOT LEGALLY JUSTIFIED IN ASSUMING THE JURISDICTION U/S. 153C. 2(A) THAT, ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(A) GROSSLY ERRED IN UPHOLDING THE VALIDITY OF THE ASSE SSMENT PROCEEDINGS U/S. 153C OF THE ACT WITHOUT APPRECIATING THE MATERIAL FACT T HAT THE LEARNED AO HAD NOT RECORDED THE OBJECTIVE SATISFACTION, AS CONTEMPLATE D U/S. 153C, BEFORE ASSUMING THE JURISDICTION OF THE ASSESSMENT. (B) THAT, WITHOUT PREJUDICE TO THE ABOVE, THE LEA RNED CIT(A) GROSSLY ERRED IN FRAMING THE ASSESSMENT U/S 153C WITHOUT FIRST DISPOSING-OFF THE OBJECTION RAISED BY THE APPELLANT COMPANY AGAINST ISSUANCE OF NOTICE U/S 15 3C. 3. THAT, THE LEARNED CIT(A) GROSSLY ERRED IN UPHOLD ING THE ACTION OF AO, IN MAKING VARIOUS TRADING ADDITIONS IN THE APPELLANT'S INCOME WITHOUT FIRST REJECTING THE BOOKS OF ACCOUNT OF THE APPELLANT UNDER THE PROVISI ONS OF SUB-SECTION (3) OF SECTION 145 OF THE INCOME-TAX ACT, 1961. 4. THAT, THE LEARNED CIT(A) GROSSLY ERRED, BOTH ON FACTS AND IN LAW, IN CONFIRMING ADDITION OF RS.3,26,33,000/-, MADE BY THE LEARNED A O, IN THE APPELLANTS INCOME, ON ACCOUNT OF ALLEGED UNEXPLAINED EXPENDITURE IN DE VGURADIA LAND, BY INVOKING THE PROVISIONS OF SECTION 69C OF THE INCOME-TAX ACT , 1961, MERELY ON GUESSWORK, SURMISES AND CONJECTURES. ASSESSEES APPEAL NO. : 196/IND/2013 A.Y. 2009-10 PHOENIX LEISURE AND LIFESTYLE (SS)195 OF 2013 AND OTHERS 3 1(A) THAT, ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(A) GROSSLY ERRED IN UPHOLDING THE VALIDITY OF THE ASSE SSMENT PROCEEDINGS U/S. 153C OF THE ACT WITHOUT APPRECIATING THE MATERIAL FACT T HAT THE LEARNED AO HAD NOT RECORDED THE OBJECTIVE SATISFACTION, AS CONTEMPLATE D U/S. 153C, BEFORE ASSUMING THE JURISDICTION OF THE ASSESSMENT. (B) THAT, WITHOUT PREJUDICE TO THE ABOVE, THE LEA RNED CIT(A) GROSSLY ERRED IN FRAMING THE ASSESSMENT U/S 153C WITHOUT FIRST DISPOSING-OFF THE OBJECTION RAISED BY THE APPELLANT COMPANY AGAINST ISSUANCE OF NOTICE U/S 15 3C. 2. THAT, THE LEARNED CIT(A) GROSSLY ERRED IN UPHOLD ING THE ACTION OF AO, IN MAKING VARIOUS TRADING ADDITIONS IN THE APPELLANT'S INCOME WITHOUT FIRST REJECTING THE BOOKS OF ACCOUNT OF THE APPELLANT UNDER THE PROVISI ONS OF SUB-SECTION (3) OF SECTION 145 OF THE INCOME-TAX ACT, 1961. 3. THAT, THE LEARNED CIT(A) GROSSLY ERRED, BOTH ON FACTS AND IN LAW, IN CONFIRMING ADDITION OF RS.33,00,000/-, MADE BY THE LEARNED AO BY INVOKING THE PROVISIONS OF SECTION 69C OF THE INCOME-TAX ACT, 1961, IN THE APP ELLANTS INCOME, ON ACCOUNT OF ALLEGED UNEXPLAINED EXPENDITURE INCURRED BY THE APPELLANT BY WAY OF PAYMENT TO SHRI CHIRAG SHAH. DEPARTMENTAL APPEAL NO. : 254/IND/2013A.Y. 2008-09 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE THE L D. CIT(A) ERRED IN DECIDING THE APPEAL AGAINST THE PRINCIPLES OF NATURAL JUSTICE, W ITHOUT AFFORDING ANY OPPORTUNITY TO THE AO OR REMANDING IT BACK IN VIOLATION OF THE DEPARTM ENTAL INSTRUCTION THAT IN SEARCH ASSESSMENTS APPEAL ORDER BE PASSED EITHER BASED ON REMAND REPORT OR AFTER HEARING THE AO. 2. ON THE FACTS AND THE CIRCUMSTANCES OF THE CASE T HE LD. CIT(A) ERRED IN DELETING THE ADDITION OF RS. 34344220/- UNDER THE HEAD UNAC COUNTED ON MONEY BY EQUATING IT WITH TRADING RECEIPT WITH THE DIRECTION TO THE AO T O TAX THE ON MONEY AFTER ALLOWING CORRESPONDING EXPENDITURE WHEN THE UNACCOUNTED RECE IPT ON ACCOUNT OF ON MONEY WAS DETECTED DURING SEARCH WHICH WAS NOT GOING TO BE SU RRENDERED BY THE ASSESSEE HAD IT NOT BEEN DETECTED. 2.1 WHILE HOLDING SO THE LD. CIT(A) FAILED TO APPRE CIATE THAT IN CASE OF PROPERTY TRANSACTIONS THE ON MONEY IS RECEIVED BY THE SELLER OVER AND ABOVE THE RECORDED VALUE OF THE TRANSACTION AND THE SAME IS TAXABLE AS HELD BY THE HONBLE ITAT IN THE CASE OF HEALTHY HOLDINGS PRIVATE LIMITED VS. ACIT (ITAT, AS R) REPORTED IN 112 ITD 51 THAT THE ON MONEY RECEIVED OVER AND ABOVE APPARENT VALUE OF TRANSACTION REPRESENT UNACCOUNTED INCOME ONLY AND NO QUESTION OF ADDING P ROFIT ELEMENT ALONE ARISES IN SUCH CASES. PHOENIX LEISURE AND LIFESTYLE (SS)195 OF 2013 AND OTHERS 4 2.2 WHILE HOLDING SO THE LD. CIT(A) FURTHER ERRED I N DIRECTING THE AO TO WORKOUT THE TAXABILITY OF UNACCOUNTED ON MONEY IN RELATION TO T HE SALES TO BE EFFECTED BY THE ASSESSEE IN THE YEAR OF SALE IN ACCORDANCE WITH THE METHOD OF ACCOUNTING FOLLOWED BY THE ASSESSEE WITHOUT APPRECIATING THAT ADDITION MAD E U/S 68 IS IN THE NATURE OF DEEMED INCOME AND HAS TO BE EFFECTED IN THE YEAR OF ITS RE CEIPT AS DEEMED ADDITIONS ARE NOT SUBJECT TO METHOD OF ACCOUNTING EMPLOYED BY ASSESSE E. 2.3 ON THE FACTS AND THE CIRCUMSTANCES OF THE CASE THE LD. CIT(A) HAS ERRED IN DIRECTING THE AO TO VERIFY THE SOURCE OF CASH DEPOS ITS OF RS. 22,85,000/- ADDED BY THE AO AS UNEXPLAINED CASH CREDITS U/S 68 OF THE I.T.AC T IN THE BANK ACCOUNTS OF THE ASSESSEE. 2.4 WHILE DIRECTING THE VERIFICATION OF THE CASH DE POSITS TO BE CARRIED OUT BY THE AO THE LD. CIT(A) TRAVELLED BEYOND HIS POWER OF CONFIR MING, REDUCING, ENHANCING OR ANNULLING THE ADDITION. 2.5 WHILE HOLDING SO THE LD. CIT(A) GROSSLY ERRED I N ACCEPTING THE ADDITIONAL ARGUMENTS TAKEN BY THE ASSESSEE BEFORE HIM BY GIVIN G A DIRECTION TO VERIFY THE SAID DEPOSITS OUT OF THE WITHDRAWALS MADE FROM THE DIFFE RENT BANK ACCOUNTS MAINTAINED BY THE ASSESSEE AS SAID WAS NOT THE PLEA OF THE ASSESS EE BEFORE THE AO. 3. IT IS THEREFORE, PRAYED THAT THE ORDER OF THE CI T(A) MAY BE SET ASIDE AND THE ORDER OF THE AO MAY PLEASE BE RESTORED. DEPARTMENTAL APPEAL NO. : 255/IND/2013 A.Y. 2009-10 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE THE L D. CIT(A) ERRED IN DECIDING THE APPEAL AGAINST THE PRINCIPLES OF NATURAL JUSTICE, W ITHOUT AFFORDING ANY OPPORTUNITY TO THE AO OR REMANDING IT BACK IN VIOLATION OF THE DEPARTM ENTAL INSTRUCTION THAT IN SEARCH ASSESSMENTS APPEAL ORDER BE PASSED EITHER BASED ON REMAND REPORT OR AFTER HEARING THE AO. 2. ON THE FACTS AND THE CIRCUMSTANCES OF THE CASE T HE LD. CIT(A) ERRED IN DELETING THE ADDITION OF RS. 1,64,35,000/- UNDER THE HEAD U NACCOUNTED ON MONEY BY EQUATING IT WITH TRADING RECEIPT WITH THE DIRECTION TO THE AO T O TAX THE ON MONEY AFTER ALLOWING CORRESPONDING EXPENDITURE WHEN THE UNACCOUNTED RECE IPT ON ACCOUNT OF ON MONEY WAS DETECTED DURING SEARCH WHICH WAS NOT GOING TO BE SU RRENDERED BY THE ASSESSEE HAD IT NOT BEEN DETECTED. 2.1 WHILE HOLDING SO THE LD. CIT(A) FAILED TO APPRE CIATE THAT IN CASE OF PROPERTY TRANSACTIONS THE ON MONEY IS RECEIVED BY THE SELLER OVER AND ABOVE THE RECORDED VALUE OF THE TRANSACTION AND THE SAME IS TAXABLE AS HELD BY THE HONBLE ITAT IN THE CASE OF PHOENIX LEISURE AND LIFESTYLE (SS)195 OF 2013 AND OTHERS 5 HEALTHY HOLDINGS PRIVATE LIMITED VS. ACIT (ITAT, AS R) REPORTED IN 112 ITD 51 THAT THE ON MONEY RECEIVED OVER AND ABOVE APPARENT VALUE OF TRANSACTION REPRESENT UNACCOUNTED INCOME ONLY AND NO QUESTION OF ADDING P ROFIT ELEMENT ALONE ARISES IN SUCH CASES. 2.2 WHILE HOLDING SO THE LD. CIT(A) FURTHER ERRED I N DIRECTING THE AO TO WORKOUT THE TAXABILITY OF UNACCOUNTED ON MONEY IN RELATION TO T HE SALES TO BE EFFECTED BY THE ASSESSEE IN THE YEAR OF SALE IN ACCORDANCE WITH THE METHOD OF ACCOUNTING FOLLOWED BY THE ASSESSEE WITHOUT APPRECIATING THAT ADDITION MAD E U/S 68 IS IN THE NATURE OF DEEMED INCOME AND HAS TO BE EFFECTED IN THE YEAR OF ITS RE CEIPT AS DEEMED ADDITIONS ARE NOT SUBJECT TO METHOD OF ACCOUNTING EMPLOYED BY ASSESSE E. 3. ON THE FACTS AND THE CIRCUMSTANCES OF THE CASE T HE LD. CIT(A) HAS ERRED IN DIRECTING THE AO TO VERIFY THE SOURCE OF CASH DEPOS ITS OF RS. 1,84,61,000/- ADDED BY THE AO AS UNEXPLAINED CASH CREDITS U/S 68 OF THE I.T.AC T IN THE BANK ACCOUNTS OF THE ASSESSEE. 3.1 WHILE DIRECTING THE VERIFICATION OF THE CASH DE POSITS TO BE CARRIED OUT BY THE AO THE LD. CIT(A) TRAVELLED BEYOND HIS POWER OF CONFIR MING, REDUCING, ENHANCING OR ANNULLING THE ADDITION. 3.2 WHILE HOLDING SO THE LD. CIT(A) GROSSLY ERRED I N ACCEPTING THE ADDITIONAL ARGUMENTS TAKEN BY THE ASSESSEE BEFORE HIM BY GIVIN G A DIRECTION TO VERIFY THE SAID DEPOSITS OUT OF THE WITHDRAWALS MADE FROM THE DIFFE RENT BANK ACCOUNTS MAINTAINED BY THE ASSESSEE AS SAID WAS NOT THE PLEA OF THE ASSESS EE BEFORE THE AO. 4. ON THE FACTS AND THE CIRCUMSTANCES OF THE CASE T HE LD. CIT(A) HAS ERRED IN DELETING THE ADDITION OF RS. 3,62,17,000/- MADE BY THE AO ON ACCOUNT OF UNEXPLAINED EXPENDITURE IN DEV GURADIA LAND BY HOLDING THAT THE ADDITION WAS BASED ON PRESUMPTION AND INFERENCE WHEREAS THE LD. CIT(A) HA S HIMSELF CONFIRMED THE ADDITION IN THE A.Y. 2008-09 ON THE SAME LAND. 4.1 WHILE HOLDING SO THE LD. CIT(A) FAILED TO APPRE CIATE THAT THE COMPLETE DETAILS OF TRANSACTION WERE NOT ONLY NOTED IN THE EXCEL SHEET BUT IT WAS ALSO CORRELATED WITH BS-8 DAIRY AS WELL AS OTHER INCRIMINATING DOCUMENTS FOUN D AND SEIZED DURING THE COURSE OF SEARCH AND HAVING DETAILS OF SPECIFIC DATES AND CAS H PAYMENT MENTIONING THE NAME OF ONE PRIME PERSON OF THE GROUP I.E. MR. CHIRAG SHAH WHO HAS INDULGED IN THE LAND DEAL AS ADMITTED BY ONE OF THE DIRECTOR OF THE ASSESSEE COMPANY I.E. SH. NILESH AJMERA. 5. IT IS THEREFORE, PRAYED THAT THE ORDER OF THE CI T(A) MAY BE SET ASIDE AND THE ORDER OF THE AO MAY PLEASE BE RESTORED. PHOENIX LEISURE AND LIFESTYLE (SS)195 OF 2013 AND OTHERS 6 DEPARTMENTAL APPEAL NO. : 565/IND/2013 A.Y. 2010-11 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE THE L D. CIT(A) ERRED IN DECIDING THE APPEAL AGAINST THE PRINCIPLES OF NATURAL JUSTICE, W ITHOUT AFFORDING ANY OPPORTUNITY TO THE AO OR REMANDING IT BACK IN VIOLATION OF THE DEPARTM ENTAL INSTRUCTION THAT IN SEARCH ASSESSMENTS APPEAL ORDER BE PASSED EITHER BASED ON REMAND REPORT OR AFTER HEARING THE AO. 2. ON THE FACTS AND THE CIRCUMSTANCES OF THE CASE T HE LD. CIT(A) ERRED IN DIRECTING THE AO TO VERIFY THE SOURCE OF CASH DEPOSITS OF RS. 37,48,700/- ADDED BY THE AO AS UNEXPLAINED CASH CREDITS U/S. 68 OF THE I.T. ACT IN THE BANK ACCOUNTS OF THE ASSESSEE. 2.1 WHILE DIRECTING THE VERIFICATION OF THE CASH DE POSITS TO BE CARRIED OUT BY THE AO THE LD. CIT(A) TRAVELLED BEYOND THE POWER OF CONFIR MING, REDUCING, ENHANCING OR ANNULLING THE ADDITION. 2.2 WHILE HOLDING SO THE LD. CIT(A) GROSSLY ERRED I N ACCEPTING THE ADDITIONAL ARGUMENTS TAKEN BY THE ASSESSEE BEFORE HIM BY GIVIN G A DIRECTION TO VERIFY THE SAID DEPOSITS OUT OF THE WITHDRAWALS MADE FROM THE DIFFE RENT BANK ACCOUNTS MAINTAINED BY THE ASSESSEE AS SAID WAS NOT THE PLEA OF THE ASSESS EE BEFORE THE AO. 3. IT IS THEREFORE, PRAYED THAT THE ORDER OF THE CI T(A) MAY BE SET ASIDE AND THE ORDER OF THE AO MAY PLEASE BE RESTORED. BOTH THE PARTIES SUBMITTED THAT THE LEAD CASE PERTA INS TO ASSESSMENT YEAR 2008- 09, THEREFORE, WE DEAL THE ASSESSMENT YEAR 2008-09 AT FIRST. ASSESSEES APPEAL NO. : 195/IND/2013 A.Y. 2008-09 DEPARTMENTAL APPEAL NO. : 254/IND/2013 A.Y. 2008-09 ASSESSEES GROUND NO. 1, 2(A) & 2(B) THESE GROUNDS OF APPEAL PERTAIN TO THE ACTION OF TH E ASSESSING OFFICER IN FRAMING THE ASSESSMENT IN THE CASE OF THE ASSESSEE COMPANY BY INVOKING PROVISIONS OF SECTION 153C OF THE INCOME-TAX ACT, 1961. SHORT FACTS OF TH E CASE ARE THAT SEARCH AND SEIZURE OPERATIONS U/S 132 WERE CONDUCTED AT THE VARIOUS PR EMISES OF THE ASSOCIATE PERSONS PHOENIX LEISURE AND LIFESTYLE (SS)195 OF 2013 AND OTHERS 7 AND CONCERNS OF THE ASSESSEE GROUP COMMONLY KNOWN A S M/S. SATELLITE GROUP ON 19.11.2009. UNDISPUTEDLY, NO SEARCH WAS CARRIED OUT IN THE ASSESSEES CASE. NOTICE U/S 153C DATED 05.8.2011 WAS ISSUED AND DULY SERVED REQ UIRING THE ASSESSEE TO FILE THE RETURN WITHIN 15 DAYS OF DATE OF SERVICE. THE ORIGI NAL RETURN FOR THIS AY 2008-09 WAS FILED U/S 139 ON 07.3.2009 ON TOTAL INCOME OF NIL CLAIMIN G CARRY FORWARD OF UNABSORBED DEPRECIATION OF RS.50,037/-. IN RESPONSE TO NOTICE U/S 153C, THE ASSESSEE REQUESTED THAT THE RETURN FILED AS PER PROVISIONS OF SECTION 139 BE TREATED AS RETURN FILED PURSUANT TO NOTICE U/S 153C. THE ASSESSEE AGITATED THAT SINCE DURING THE COURSE OF SEARCH INITIATED UNDER S. 132, NO UNDISCLOSED MONEY, BULLION, JEWELLERY OR OT HER VALUABLE ARTICLES OR THINGS OR INCRIMINATING BOOKS OF ACCOUNT OR DOCUMENTS RELATIN G TO THE ASSESSMENT YEAR UNDER CONSIDERATION WERE FOUND, THE AO WAS NOT JUSTIFIED IN INVOKING THE PROVISIONS OF S. 153C OF THE ACT. MATTER CARRIED TO LD. CIT(A) AND LD. CIT(A), AFTER CONSIDERING THE SUBMISSION OF THE ASSESSEE, UPHELD THE ACTION OF THE LEARNED AO B Y GIVING HIS FINDINGS AT PARA 5.3 AT PAGE NO. 6 & 7 OF HIS ORDER. 5.3 I HAVE CONSIDERED THE A.O.S ORDER AS WELL AS THE A PPELLANTS A/R SUBMISSION. HAVING CONSIDERED THE FACTS AND CIRCUMS TANCES OF THE CASE, I DO NOT FIND ANY MERIT OR SUBSTANCE IN THE ARGUMENT OF THE APPELLANTS A/R. IT IS AN UNDISPUTED FACT THAT DURING THE COURSE OF SEARCH PROCEEDINGS IN THE GROUP ASSESSEE, CERTAIN LOOSE PAPERS INVENTORISED A S LPS-A/1, LPS-A/3, LPS-A/4 BELONGING TO THE APPELLANT WERE FOUND AND S EIZED FROM THE PREMISES OF M/S. PHOENIX DEVCONS PVT. LTD.. THUS, T HE AO AFTER RECORDING NECESSARY SATISFACTION ISSUED THE NOTICE UNDER S. 1 53C TO THE APPELLANT. EVEN BEFORE THE UNDERSIGNED, I FIND THAT THE APPELL ANTS A/R HAS NOT BROUGHT ANY EVIDENCE ON RECORD THAT THE REQUIRED SA TISFACTION WAS NOT SO RECORDED BY THE AO. IN MY CONSIDERED VIEW, FOR THE PURPOSE OF INVOKING THE PROVISIONS OF S. 153C, AT THE STAGE OF THE INIT IATION OF THE PROCEEDINGS PHOENIX LEISURE AND LIFESTYLE (SS)195 OF 2013 AND OTHERS 8 ITSELF, THE AO IS NOT REQUIRED TO FORM A CONCLUSIVE VIEW OR SATISFACTION AS REGARD TO THE INCRIMINATING OR NON-INCRIMINATING NA TURE OF THE DOCUMENT AND ONCE, IN THE OPINION OF THE AO OF THE PERSON SE ARCHED, THE DOCUMENTS SEIZED BELONG TO SOME OTHER ASSESSEE, THE A.O. CAN, AFTER RECORDING THE SATISFACTION, HAND OVER THE SEIZED MATERIAL TO THE AO OF THE PERSON TO WHOM SUCH DOCUMENTS ELONG. IN THE INSTANT CASE BEIN G SAME AO IN BOTH THE CASES, THE AO WAS WELL WITHIN HIS POWER TO ASSU ME THE JURISDICTION UNDER S. 153C OF THE ACT, ON THE BASIS OF THE DOCUM ENTS SEIZED AFTER RECORDING THE NECESSARY SATISFACTION. IN MY CONSIDE RED VIEW, ALL THE CONDITIONS GOT SATISFIED IN THE INSTANT CASE BEFORE ISSUANCE OF THE NOTICE UNDER S. 153C. THEREFORE, THERE IS NO INFIRMITY IN THE AOS ACTION IN FRAMING THE ASSESSMENT UNDER S. 153C. ACCORDINGLY, THESE GR OUNDS OF APPEAL ARE DISMISSED. THE LD. AR HAS MADE ORAL AS WELL AS WRITTEN SUBMIS SION AS UNDER: THE LEARNED AO HAD ISSUED NOTICE U/S. 153C OF THE ACT TO THE APPELLANT ONLY ON THE BASIS OF A SEARCH U/S. 132(1) WHICH WAS CARRIED OUT IN THE CASE OF OTHER COMPANY NAMELY M/S. PHOENIX DE VCONS PVT. LTD. 19- 11-2009. NO MONEY, BULLION, JEWELLERY OR OTHER VA LUABLE ARTICLE OR THING OR BOOKS OF ACCOUNT OR DOCUMENTS, BELONGING TO THE APPELLANT, WAS SEIZED DURING THE COURSE OF ENTIRE SEARCH OPERATION CARRIED OUT U/S. 132.PROVISIONS OF SECTION 153C CAN BE INVOKED ONLY IN THOSE CASES WHERE ANY MONEY, BULLION, JEWELLERY OR OTHER VALUABLE ART ICLE OR THING OR BOOKS OF ACCOUNT OR DOCUMENTS, BELONGING TO A PERSON OTHER T HAN THE PERSON SEARCHED ARE NOT ONLY FOUND BUT ALSO SEIZED. SEIZUR E IS A MANDATORY PREREQUISITE FOR INVOKING OF THE PROVISIONS OF SECT ION 153C AND SINCE IN THE INSTANT CASE, NO SEIZURE OF ANY ASSET OR BOOK OR DO CUMENT BELONGING TO THE APPELLANT WAS MADE, THE ENTIRE ASSESSMENT PROCE EDING U/S. 153C HAS TO BE REGARDED AS ILLEGALITY AND CONSEQUENTLY, THE ASSESSMENT ORDER SO PASSED ALSO DESERVES TO BE ANNULLED ON THIS GROUND ALONE.IT IS SUBMITTED THAT IN THE INSTANT CASE, ACCORDING TO THE AO, NOTI CE UNDER S.153C HAS BEEN ISSUED TO THE ASSESSEE ON THE BASIS OF CERTAIN LOOSE PAPERS AND DOCUMENTS SEIZED FROM THE PREMISES OF SOME OTHER CO MPANY NAMED AND TITLED AS M/S. PHOENIX DEVCONS PVT. LTD.. IT IS SUB MITTED THAT ALTHOUGH THE AO PASSING THE IMPUGNED ORDER, AT PARA 3.2 OF HIS O RDER, HAS STATED THAT A SATISFACTION WAS RECORDED BY HIM BEFORE ISSUANCE OF THE NOTICE TO THE ASSESSEE. SUCH ASSERTION OF THE AO IS NOT BEING DIS PUTED HERE. BUT, THE ASSESSEE SUBMITS THAT IN THE GIVEN CIRCUMSTANCES, I NITIALLY, THE SATISFACTION AS REGARD TO BELONGING OF CERTAIN LOOSE PAPERS, DOC UMENTS ETC., SEIZED FROM THE PREMISES OF M/S. PHOENIX DEVCONS PVT. LTD, TO THE ASSESSEE, OUGHT TO HAVE BEEN SEPARATELY RECORDED BY THE AO OF ABOVE NAMED COMPANY WHICH HAS NOT BEEN DONE SO IN THE INSTANT C ASE. IT IS SUBMITTED PHOENIX LEISURE AND LIFESTYLE (SS)195 OF 2013 AND OTHERS 9 THAT IT HAS BEEN JUDICIALLY PRONOUNCED BY MANY AUTH ORITIES THAT RECORDING OF THE SATISFACTION BY THE AO OF THE PERSON SEARCHED I S MANDATORY AND IT CANNOT BE DISPENSED WITH EVEN IF THE AO OF THE PERS ON SEARCHED AND THE AO OF THE THIRD PERSON IS SAME. FOR SUCH PROPOSITIO N, WE PLACE RELIANCE ON THE FOLLOWING JUDICIAL PRONOUNCEMENTS : (I) CIT VS. MECHMEN (2015) 7 TMI 538 (MP HC) (II) PR. CIT VS. AAKASH AROGYA MANDIR PVT. LTD. (20 15) 7 TMI 147 (DEL. HC) (III) PR. CIT VS. NIKKI DRUGS & CHEMICALS PVT. LTD. (2015) 12 TMI 304 (DEL. HC) THE HON'BLE ITAT INDORE BENCH IN THE CASE OF ACIT VS. CHIRCHID HYDRO LTD. (2011) 17 ITJ 197 (TRIB), HAS CLEARLY HELD THA T BEFORE FRAMING ASSESSMENT UNDER S. 153C, A SATISFACTION IS REQUIRE D TO BE RECORDED TO THE EFFECT THAT DOCUMENTS AND OTHER MATERIALS FOUND DUR ING THE COURSE OF SEARCH BELONGS TO A PERSON OTHER THAN THE PERSONS S EARCHED. THE HON'BLE BENCH AT PARA 81 OF THE ORDER FURTHER OBSERVED THAT THE LEGAL REQUIREMENT OF RECORDING OF THE SATISFACTION CANNOT BE SUBSTITU TED BY APPRAISAL NOTE WHICH IS PREPARED BY THE SEARCH PARTY AFTER COMPLET ION OF THE SEARCH IN SO FAR AS SUCH APPRAISAL NOTE IS A SECRET DOCUMENT PRE PARED BY THE DEPARTMENT FOR THE INTERNAL USE, CONTENTS OF WHICH ARE NOT CONVEYED TO THE ASSESSEE. LD. DR HAS RELIED ON THE ORDER OF THE ASSESSING OFF ICER. WE HAVE HEARD RIVAL CONTENTIONS OF BOTH THE PARTIES AND PERUSED THE MATERIAL AVAILABLE ON RECORD. IT IS UNDISPUTED FACT THAT DUR ING THE COURSE OF SEARCH PROCEEDINGS IN THE GROUP ASSESSEES, CERTAIN LOOSE PAPERS INVENTORI SED AS LPS-1, LPS A/3, LPS A/4, BELONGING TO ASSESSEE WERE FOUND AND SEIZED FROM TH E PREMISES OF M/S. PHOENIX DEVCONS P. LTD.THE ASSESSING OFFICER HAS ISSUED A N OTICE U/S 153C OF THE ACT ON THE BASIS OF SEARCH U/S 132(1) WHICH WAS CARRIED OUT IN THE CASE OF OTHER COMPANY NAMELY PHOENIX LEISURE AND LIFESTYLE (SS)195 OF 2013 AND OTHERS 10 PDPL ON 19.11.2009. THE ASSESSING OFFICER HAS ISSUE D NOTICE U/S 153C AND HE HAS REOPENED ASSESSMENT FROM AY 2004-05 TO AY 2009-10. THE PROVISIONS OF SEC. 153C CAN BE INVOKED ONLY AFTER RECORDING A SATISFACTION IN THE CASE OF PERSONS SEARCHED QUA THE ASSETS OR BOOKS OR DOCUMENTS SEIZED DURING THE COURSE OF SEARCH BELONG TO SOME OTHER PERSON. IN THE INSTANT CASE, THE ASSESSING OF FICER OF PDPL HAS NOT RECORDED ANY SATISFACTION QUA THE BELONGINGNESS OF THE SEIZED DO CUMENTS WITH THE ASSESSEE AND THERE WAS NO SATISFACTION RECORDED, THEREFORE, THE ASSESSMENT IS BAD IN LAW. THE HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF CI T VS. MECHMEN WHEREIN THE SIMILAR ISSUE HAD COME UP AND THE HON'BLE HIGH COURT HAS DI SCUSSING THE VARIOUS JUDGMENTS HAS HELD AS UNDER: EVEN IF THE AO OF THE SEARCHED PERSON AND OF THE 'O THER PERSON' (I.E. THE ASSESSEE) IS THE SAME, THE PROPER SATISFACTION HAS TO BE RECORDED BEFORE ASSUMING JURISDICTION OVER THE ASSESSEE. FAILURE TO RECORD SATISFACTION RENDERS THE ASSESSMENT ORDER NULL AND VOID THE HIGH COURT HAD TO CONSIDER WHETHER THE ASSESSME NT ORDER PASSED U/S 153C COULD BE QUASHED ON THE GROUND THAT THE AO HAD NOT RECORDED HIS SATISFACTION EVEN THOUGH THE AO MAKING THE ASSESSMENT OF THE SEA RCHED PERSON WAS HIMSELF HAVING JURISDICTION OVER SUCH OTHER PERSON (I.E. TH E ASSESSEE). IT ALSO HAD TO CONSIDER WHETHER THE LAW LAID DOWN IN MANISH MAHESH WARI VS. ACIT 289 ITR 341 AND CIT VS. CALCUTTA KNITWEARS 362 ITR 673 (SC), WH ICH WERE RENDERED IN THE CONTEXT OF SECTION 158BD, WERE APPLICABLE TO SECTIO N 153C OF THE I.T. ACT. HELD BY THE HIGH COURT: (I) THE DISSIMILARITY OF THE FORM OF TWO PROVISIONS OF S. 158BC AND S. 153C WOULD MAKE NO DIFFERENCE TO THE PURPOSE UNDERLYING. THE P OWER BESTOWED ON THE ASSESSING OFFICER HAVING JURISDICTION BE IT UNDER SECTION 153C OR SECTION 158BD IS IDENTICAL. THE LEGAL POSITION AS APPLICA BLE TO SECTION 158BD REGARDING SATISFACTION IN THE FIRST INSTANCE OF THE FIRST ASS ESSING OFFICER FORWARDING THE ITEMS TO THE ASSESSING OFFICER HAVING JURISDICTION; AND I N THE SECOND INSTANCE OF THE ASSESSING OFFICER HAVING JURISDICTION WHILST SENDIN G NOTICE TO SUCH OTHER PERSON (OTHER THAN THE PERSON REFERRED TO IN SECTION 153A) , MUST APPLY PROPRIO VIGORE. THE FACT THAT INCIDENTALLY THE ASSESSING OFFICER IS COMMON AT BOTH THE STAGES WOULD NOT EXTRICATE HIM FROM RECORDING SATISFACTION AT THE RESPECTIVE STAGES. IN THAT, THE ASSESSING OFFICER IS SATISFIED THAT THE I TEMS REFERRED TO IN SECTION 153C PHOENIX LEISURE AND LIFESTYLE (SS)195 OF 2013 AND OTHERS 11 BELONGS OR BELONG TO A PERSON (OTHER THAN THE PERSO N REFERRED TO IN SECTION 153A), BEING SINE QUA NON. HE CANNOT ASSUME JURISDI CTION TO TRANSMIT THOSE ITEMS TO ANOTHER FILE WHICH INCIDENTALLY IS PENDING BEFOR E HIM CONCERNING OTHER PERSON (PERSON OTHER THAN THE PERSON REFERRED TO IN SECTIO N 153A). THE QUESTION AS TO WHETHER THAT MAY INFLUENCE THE OPINION OF THE ASSES SING OFFICER HAVING JURISDICTION OVER SUCH OTHER PERSON, ALSO CANNOT BE THE BASIS TO TAKE ANY OTHER VIEW. AS A MATTER OF FACT, THE OTHER ASSESSING OFFI CER TO WHOM THE ITEMS ARE HANDED OVER, BEFORE ISSUING NOTICE MUST HIMSELF BE SATISFIED AFTER DUE VERIFICATION OF THE ITEMS RECEIVED AND THE DISCLOSURES MADE BY T HE OTHER PERSON IN THE RETURNS FOR THE RELEVANT PERIOD ALREADY FILED BY THE OTHER PERSON BEFORE HIM. FOR THE SAME REASON, WE MUST REJECT THE ARGUMENT OF THE DEPARTME NT THAT THE DISCRETION OF THE ASSESSING OFFICER HAVING JURISDICTION WILL BE IMPAI RED IN ANY MANNER, IF HE WERE TO HOLD A DIFFERENT VIEW. SIMILARLY, AS THERE IS NO PR OVISION EITHER EXPRESS OR IMPLIED (IN THE ACT) TO DISPENSE WITH THE REQUIREMENT OF SA TISFACTION, IF THE ASSESSING OFFICER HAPPENS TO BE THE SAME, AS IN THIS CASE, TH E ARGUMENT OF THE DEPARTMENT MUST BE NEGATIVED. (II) AFTER RECEIPT OF THE MATERIALS, THE ASSESSING OFFICER HAVING JURISDICTION IS EXPECTED TO CONDUCT ENQUIRY AND DUE VERIFICATION OF THE RELEVANT FACTS; BEFORE FORMING HIS PRIMA FACIE SATISFACTION. THE ASSESSING OFFICER HAVING JURISDICTION WILL BE WELL WITHIN HIS RIGHTS TO FORM AN INDEPENDENT VI EW BEFORE ISSUING NOTICE TO THE OTHER PERSON (PERSON OTHER THAN THE PERSON REFERRED TO IN SECTION 153A) UNDER HIS JURISDICTION ON THE BASIS OF HIS OWN ENQUIRY. IN OU R OPINION, THE VIEW FORMED BY THE ASSESSING OFFICER AFTER HIS OWN ENQUIRY DOES NOT EN TAIL SITTING IN APPEAL OVER THE SATISFACTION OF THE FIRST ASSESSING OFFICER, WHO HA D HANDED OVER THE ITEMS TO HIM. (III) ACCORDINGLY, THE CONDITION PRECEDENT FOR RESO RTING TO ACTION UNDER SECTION 158BD DELINEATED BY THE SUPREME COURT IN THE CASE O F MANISH MAHESHWARI 289 ITR 341 AND IN THE RECENT CASE OF COMMISSIONER OF I NCOME TAX-III VS. CALCUTTA KNITWEARS 362 ITR 673, WOULD APPLY ON ALL FOURS MAN DATING SATISFACTION OF THE ASSESSING OFFICER(S) DEALING WITH THE CASE AT THE R ESPECTIVE STAGES REFERRED TO IN SECTION 153C. WE HAVE GONE THROUGH THE FACTS AND CIRCUMSTANCES OF THE CASE AND MATERIAL ON RECORD. HOWEVER, WE DO NOT FIND OURSELVES IN AGREEM ENT WITH THE FINDING OF THE CIT(A) TO THE EFFECT THAT AT THE STAGE OF INITIATION OF THE P ROCEEDINGS U/S 153C ITSELF, THE ASSESSING OFFICER IS NOT REQUIRED TO FORM A SATISFACTION AS R EGARD TO THE BELONGINGNESS OF INCRIMINATING DOCUMENTS TO A THIRD PERSON. THE LEGA L POSITION IS OTHERWISE AND THE HONBLE JURISDICTIONAL HIGH COURT (SUPRA), HAS HELD THAT EVEN WHEN THE ASSESSING PHOENIX LEISURE AND LIFESTYLE (SS)195 OF 2013 AND OTHERS 12 OFFICER OF THE PERSON SEARCHED AND THE OTHER PERSON IS COMMON, THE ASSESSING OFFICER OF THE PERSON SEARCHED HAS TO NECESSARILY FORM A SA TISFACTION THAT THE ITEM REFERRED TO IN SEC. 153C BELONGS OR BELONG TO A PERSON OTHER THAN THE PERSON SEARCHED. APPARENTLY, IN THE PRESENT CASE, NO SUCH SATISFACTION BY THE ASSES SING OFFICER IN CASE OF PDPL HAS BEEN FOUND RECORDED. WE HAVE ALSO TAKEN NOTE OF A C IRCULAR NO.24/2015 DATED 31.12.2015, ISSUED BY THE CBDT, IN WHICH, THE BOARD FOLLOWING THE DECISION OF HONBLE SUPREME COURT IN CASE OF M/S. CALCUTTA KNITWEARS HA S DIRECTED THAT WHERE THE SATISFACTION BY THE ASSESSING OFFICER OF THE PERSON SEARCHED AND OTHER PERSON IS NOT FOUND RECORDED, THE DEPARTMENT SHOULD NOT PRESS THA T MATTER IN APPEAL. THUS, THE ASSESSMENT IS HELD AS ILLEGAL AND VOID-AB-INITIO. T HEREFORE, WE ALLOW THE APPEAL OF THE ASSESSEE ON THIS ISSUE. ASSESSEES GROUND NO. 3 THIS GROUND IS DIRECTED AGAINST CIT(A)S FINDING C ONFIRMING THE ACTION OF THE AO OF MAKING VARIOUS TRADING ADDITIONS WITHOUT FIRST REJE CTING THE BOOKS OF ACCOUNT BY INVOKING PROVISIONS OF S. 145(3) OF THE INCOME-TAX ACT, 1961 . MATTER CARRIED TO LD. CIT(A) AND THE LD. CIT(A) DEA LT THIS ISSUE AT PARA 7.4, AT PAGE NO.8 & 9, OF HIS ORDER. THE LEARNED CIT(A) HAS DISM ISSED THIS GROUND OF APPEAL OF THE ASSESSEE. THE LD. AR HAS MADE ORAL SUBMISSION AS WELL AS WRI TTEN SUBMISSION AS UNDER: THE APPELLANT BEING A COMPANY, HAS MAINTAINED REG ULAR BOOKS OF ACCOUNT IN ITS ORDINARY COURSE OF BUSINESS BY OBSERVING ONE OF THE RECOGNIZED METHODS OF ACCOUNTING VIZ. 'MERCANTILE SYSTEM OF AC COUNTING', UNDER THE PROVISIONS OF SECTION 44AA OF THE INCOME-TAX ACT, 1 961. BASED UPON THE BOOKS OF ACCOUNT MAINTAINED, THE APPELLANT COMPANY HAD DRAWN ITS FINANCIAL STATEMENTS FOR THE PREVIOUS YEAR UNDER CO NSIDERATION. THE APPELLANT COMPANY HAD ALSO GOT ITS BOOKS OF ACCOUNT DULY AUDITED BY ITS PHOENIX LEISURE AND LIFESTYLE (SS)195 OF 2013 AND OTHERS 13 STATUTORY AUDITORS UNDER THE PROVISIONS OF THE COMP ANIES ACT, 1956. A COPY OF THE AUDITED FINANCIAL STATEMENTS ALONG WITH THE COPY OF THE AUDIT REPORT, FOR THE RELEVANT PREVIOUS YEAR, ARE PLACED AT PAGE NO. 81 TO 92 OF OUR COMPILATION. IT SHALL BE PERTINENT TO NOTE THAT A COPY OF SUCH FINANCIAL STATEMENTS WAS ALSO PLACED ON THE AO'S RECORD AND I N THE BODY OF THE ASSESSMENT ORDER, AT VARIOUS PLACES, THE LEARNED AO HAS ALSO MADE A REFERENCE OF SUCH FINANCIAL STATEMENTS. UNDER S.145 (1) OF THE INCOME-TAX ACT, 1961, INCOME CHARGEABLE UNDER THE HEAD 'PROFIT S AND GAINS OF BUSINESS OR PROFESSION' IS REQUIRED TO BE COMPUTED ONLY IN ACCORDANCE WITH THE BOOKS OF ACCOUNT MAINTAINED BY AN ASSESSEE EITHER BY OBSERVING CASH OR MERCANTILE SYSTEM OF ACCOUNTING. IT IS A SE TTLED LAW THAT UNLESS AND UNTIL BOOKS OF ACCOUNT, REGULARLY MAINTAINED BY AN ASSESSEE, ARE SPECIFICALLY REJECTED BY AN AO BY INVOKING PROVISIO NS OF SUB-SECTION (3) OF SECTION 145 OF THE ACT, INCOME FROM BUSINESS HAS TO BE COMPUTED ONLY AND ONLY IN ACCORDANCE WITH THE REGULAR BOOKS OF AC COUNT MAINTAINED BY THE ASSESSEE. LD. DR HAS RELIED ON THE ORDERS OF THE REVENUE AUTH ORITIES. WE HAVE HEARD RIVAL CONTENTIONS AND PERUSED THE MAT ERIAL AVAILABLE ON RECORD. HAVING CONSIDERED, WE DO NOT FIND ANY MERIT IN THE ARGUMENTS OF THE ASSESSEE. IT IS AN UNDISPUTED FACT ON RECORD THAT A SEARCH UNDER S. 13 2 WAS CARRIED OUT IN THE BUSINESS PREMISES OF ONE COMPANY NAMELY, M/S. PHOENIX DEVCON S PVT. LTD. AS ALSO IN THE RESIDENTIAL PREMISES OF THE DIRECTORS OF THE ABOVE NAMED COMPANY BY ADIT(INV.)-I, INDORE. DURING THE COURSE OF THE SEARCH & SEIZURE O PERATION VARIOUS DOCUMENTS WERE FOUND AND SEIZED OUT OF WHICH CERTAIN DOCUMENTS AND LOOSE PAPERS BELONGED TO THE ASSESSEE COMPANY. IT WAS NOTICED FROM THE LOOSE PAP ERS THAT THE ASSESSEE WAS INDULGED IN SUBSTANTIAL VOLUME OF UNACCOUNTED TRANS ACTIONS. THE ASSESSEE NOT ONLY PHOENIX LEISURE AND LIFESTYLE (SS)195 OF 2013 AND OTHERS 14 RECEIVED ON-MONEY BUT ALSO INCURRED CERTAIN EXPENDI TURE WHICH WAS NOT RECORDED IN ITS REGULAR BOOKS OF ACCOUNT. IN SUCH CIRCUMSTANCES, TH E BOOKS OF ACCOUNT OF THE ASSESSEE CANNOT BE SAID TO BE CORRECT OR COMPLETE. THEREFORE , THERE CANNOT BE TWO VIEWS FOR THE PROPOSITION THAT THE REGULAR BOOKS OF ACCOUNT OF TH E ASSESSEE WERE NOT ONLY UNRELIABLE BUT THEY WERE ALSO LIABLE FOR COMPLETE REJECTION. W E FIND THAT THE AO HAS ELABORATELY DEALT WITH THE VARIOUS SHORTCOMINGS AND DISCREPANCI ES IN THE BOOKS OF ACCOUNT OF THE ASSESSEE AND FURTHER THERE IS NO SUBSTANCE IN THE A SSESSEES SUBMISSION THAT THE AO DID NOT REJECT THE BOOKS OF ACCOUNT. THE LAW DOES N OT CONTEMPLATE REJECTION OF BOOKS UNDER S. 145(3) IN CERTAIN SPECIFIC FORMAL WORDS ON LY AND IT CAN VERY WELL BE INFERRED FROM THE VARIOUS DISCREPANCIES NOTED IN THE ASSESSMENT O RDER. IN VIEW OF THE AFORESAID FACTS OF THE CASE, WE CONSIDER IT PROPER AND APPROPRIATE TO HOLD THAT THE A.O. WAS COMPLETELY JUSTIFIED IN INVOKING THE PROVISIONS OF SECTION 145 (3) OF THE ACT. THUS, THIS GROUND OF APPEAL IS DISMISSED. ASSESSEES GROUND NO. 4 THIS GROUND OF APPEAL RELATES TO THE ADDITION OF R S.3,26,33,000/- MADE IN THE HANDS OF THE ASSESSEE ON ACCOUNT OF ALLEGED UNEXPLA INED EXPENDITURE IN DEVGURADIA LAND, BY INVOKING THE PROVISIONS OF SECTION 69C OF THE INCOME-TAX ACT, 1961. THE BRIEF FACTS RELATING TO THE GROUND, AS NOTED B Y THE AO, ARE THAT DURING THE COURSE OF SEARCH IN THE PREMISES OF M/S. PHOENIX DE VCONS PVT. LTD., A SISTER CONCERN OF THE ASSESSEE, SOME HARD DISKS OF COMPUTERS WERE SEI ZED. FROM ONE OF THE HARD DISKS, THE AO TOOK PRINT OUT OF A SHEET CONTAINING THE DET AILS OF CERTAIN INVESTMENTS MADE BY THE ASSESSEE COMPANY. FROM SUCH PRINT OUT AND A DIA RY INVENTORIZED AS BS-8 FOUND IN THE PREMISES OF M/S. PHOENIX DEVCONS PVT. LTD., THE AO FORMED THE VIEW THAT THE PHOENIX LEISURE AND LIFESTYLE (SS)195 OF 2013 AND OTHERS 15 ASSESSEE COMPANY HAD MADE PAYMENTS AGGREGATING TO R S.7,03,50,000/- IN TWO ASSESSMENT YEARS, VIZ. A.Y. 2008-09 AND A.Y. 2009-1 0 TOWARDS PURCHASE OF SOME LAND AT VILLAGE DEVGURADIA. THE AO FURTHER NOTED THAT TH E ASSESSEE COMPANY HAD RECORDED INVESTMENT TO THE EXTENT OF RS.15,00,000/- ONLY IN ITS BOOKS OF ACCOUNT. THUS, THE AO DETERMINED THE TOTAL AMOUNT OF UNEXPLAINED INVESTME NT IN PURCHASE OF LAND AT VILLAGE DEVGURADIA AT RS.6,88,50,000/-. OUT OF THIS, THE AO HELD THAT INVESTMENT TO THE EXTENT OF RS.3,26,33,000/- WAS MADE BY THE ASSESSEE COMPANY D URING A.Y. 2008-09 WHEREAS INVESTMENT TO THE EXTENT OF RS.3,62,17,000/- WAS MA DE BY THE ASSESSEE COMPANY DURING A.Y. 2009-10. ACCORDINGLY, BY INVOKING THE P ROVISIONS OF S. 69C, THE AO MADE AN ADDITION OF RS.3,26,33,000/- IN THE ASSESSEES INCOM E UNDER THE HEAD UNEXPLAINED EXPENDITURE IN DEVGURADIA LAND. THE RELEVANT FINDI NGS OF THE ASSESSING OFFICER ARE RECORDED AT PARA 8.1 AT PAGE NO. 25 TO PARA 8.11 AT PAGE NO. 32 OF THE ASSESSMENT ORDER. MATTER CARRIED TO LD. CIT(A) AND LD. CIT(A), AFTER CONSIDERING THE SUBMISSION OF THE ASSESSEE, CONFIRMED THE ADDITION OF RS.3,26,33, 000/- BY GIVING HIS FINDINGS AT PARA 10.4 TO PARA 10.6 OF HIS ORDER: 10.4 I HAVE CONSIDERED THE A.O.S ORDER AS WELL AS THE APPELLANTS A/R SUBMISSION. HAVING CONSIDERED BOTH, I FIND THAT THE A.O. HAS DISCUSSED THIS ISSUE IN PARA-8 OF THE ASSESSMENT ORDER, WHERE IN THE A.O. TOOK NOTE OF A PRINT OUT OF TAKEN FROM THE HARD DISK OF A COMPUT ER SITUATED IN THE OFFICE3 PREMISES OF M/S PHOENIX DEVCONS PVT. LTD. THE A.O. HAS ASSERTED IN PARA-8.2 OF THE ORDER THAT THE SAME OFFICE OF M/S. PDPL WAS THE OFFICE OF THE APPELLANT COMPANY ALSO. MR. NILESH AJMERA WAS T HE DIRECTOR OF THE APPELLANT COMPANY AS WELL AS ALSO IN M/S. PDPL. THE PRINT OUT SHEETS WHICH HAVE BEEN TAKEN FROM THE COMPUTER OF HARD DIS K CONTAINS THE FILE NAME NEW HISAB 16CR. THE SAID PRINT OUT HAS BEEN EXTRACTED BY A.O. IN PARA-8.2 OF THE ASSESSMENT ORDER. FURTHER TO THAT, IT IS ALSO EVIDENT FROM PHOENIX LEISURE AND LIFESTYLE (SS)195 OF 2013 AND OTHERS 16 THE A.O.S ORDER THAT THE TRANSACTION NOTED ON VARI OUS DATES IN THE NAME OF PHOENIX WINGS CONTAIN THE DETAILS OF CASH ACCOUNT. THE A.O. HAS ALSO NOTED THAT THE ABOVE STATED SHEETS WHICH WERE TAKEN FROM THE HARD DISK OF THE COMPUTER MATCHES WITH THE HAND WRITTEN NOTING M ADE AGAINST SAHARA CITY PROJECT IN THE DIARY BS-8 AS WELL AS LOOSE PA PER SEIZED FROM THE RESIDENTIAL PREMISES OF SHRI NILESH AJMERA AT SAMAR TH AANGAN, ANDHERI (W), MUMBAI. FURTHER I FIND THAT THE A.O. HAS TAKEN NOTE OF THE STATEMENT OF SHRI NILESH AJMERA AS WELL AS THE DETAILS OF APP ELLANTS COMPANY SUBMISSION DATED 14/12/11 WHEREIN THE APPELLANT COM PANY HAS ACKNOWLEDGE OF THE IDENTITY OF LAND SITUATED AT SAH ARA CITY PROJECT VILLAGE DEVGURADIA, INDORE FOR DEVELOPING A HOUSING PROJECT . FURTHER TO THAT THE APPELLANT COMPANY ALSO ACKNOWLEDGEMENT OF PAYMENT O F A SUBSTANTIAL AMOUNT OF RS.1,13,65,200/- TO M/S. DELLA ITALIA BY WAY OF THEIR PROFESSIONAL FEES UPTO 31/03/09 TOWARDS THE PROFESSIONAL FEES FO R SURVEY OF THE LAND AT DEVGURADIA PROJECT. EVEN I FIND THAT THE A.O. HAS T AKEN DETAIL NOTE OF DIFFERENT CIRCUMSTANTIAL EVIDENCE AND TRANSACTION N OTED ON DIFFERENT LOOSE SHEETS AND BS-8 DIARY WHICH WERE VERY IMPORTANT DOC UMENTS, WHEREIN THE DETAILS OF INVESTMENT OF CASH OF DIFFERENT PROJECTS OF THIS SATELLITE GROUP WERE FOUND NOTED. HAVING TAKEN NOTE OF ALL THESE FA CTS AND DETAILED DELIBERATION MADE BY A.O. FROM PARA-8.1 TO 8.10 OF THE ORDER, THE A.O. HAS MADE THE ADDITION OF RS.3,26,33,000/- IN THE PRESEN T ASSESSMENT YEAR AND ANOTHER SUM OF RS.3,62,17,000/- IN A.Y. -09-10. I FIND THAT THE A.O. BASED ON THE DETAILS NOTED ON THE COMPUTER SHEET HA S WORKED OUT THE TOTAL VALUE OF INVESTMENT IN THE SAID PROJECT AT 28.14 CR ORES AS DETAILED IN PARA- 8.8 OF THE ASSESSMENT ORDER AND AS BEING 25% OF SHA RE AS MENTIONED FOR NILESH SIR, THE A.O. PRESUMED THAT THE TOTAL INVE STMENT OF RS.7,03,50,000/-, THE A.O. OTED THAT A PAYMENT OF R S.15,00,000/- HAS BEEN SHOWN IN THE APPELLANTS COMPANY BALANCE SHEET TOWARDS DEVGURADIA PROJECT, HENCE THE REMAINING TOTAL SUM O F RS.6,88,50,00,000/- (RS.7,03,50,000 RS.15,00,000/-) HAS BEEN HELD BY THE A.O. INVESTED BY THE APPELLANT COMPANY BUT NOT REFLECTED IN THE BOOK S OF ACCOUNTS. THEN AFTER THE A.O. BASED ON THE PAYMENT REFLECTED ON TH E COMPUTER SHEET HAS WORKED OUT THE PAYMENT MADE BY THE APPELLANT COMPAN Y OF RS.3,26,33,000/- IN CASH BY SHRI NILESH AJMERA, DIR ECTOR OF THE APPELLANT COMPANY IN A.Y.-08-09. THEN AFTER THE A.O. HAS MADE THE INFERENCE BASED ON THE AFORESAID WORKING THAT THE REMAINING PAYMENT OF RS.3,62,17,000/- COULD HAVE BEEN PAID BY THE APPELLANT COMPANY IN A. Y.-09-10 AS STATED BY A.O. IN PARA-8.9 OF THE ASSESSMENT ORDER. ACCORDING LY HE ADDED THE SAID SUM IN A.Y.-2009-10. PHOENIX LEISURE AND LIFESTYLE (SS)195 OF 2013 AND OTHERS 17 10.5 I FIND THAT THE APPELLANTS A/R HAS VEHEMENTLY DENI ED OF ANY PAYMENT EITHER BY SHRI NILESH AJMERA OR BY THE APPE LLANT COMPANY. HE ARGUED THAT THE COMPUTER SHEET WAS TAKEN FROM THIRD PARTY PREMISES AND HENCE THE SAME SHOULD NOT BE TAKEN NOTE ADVERSELY A GAINST THE APPELLANT COMPANY. TO THIS ASPECT HE DRAWN MY ATTENTION TO TH E PROVISION OF SECTION 292C AND SECTION 132(4) OF THE ACT AND ON THAT BASI S HE REQUESTED FOR DELETION OF THE SAID ADDITION MADE BY THE A.O. HOWE VER, I AM NOT INCLINED TO ACCEPT THE APPELLANTS A/R REQUEST TO THE EXTENT THAT THE A.O. HAS VERY CATEGORICALLY GIVEN HIS FINDING IN PARA-8.2 OF THE ORDER THAT THE SAME PREMISES WAS THE OFFICE OF THE APPELLANT COMPANY AL SO. BESIDES THIS, MR. NILESH AJMERA WAS THE DIRECTOR IN BOTH THE COMPANY. IN ADDITION TO THIS, THE TRANSACTION NOTED IN SHEETS WHICH HAS BEEN EXTRACTE D BY A.O. IN PARA-8.2 OF THE ORDER, WHICH WAS BASIS OF THE ADDITION GETS CO-RELATED WITH BS-8 DIARY AS WELL AS THE OTHER DOCUMENTS, WHICH WERE SE IZED FROM THE RESIDENTIAL PREMISES OF SHRI NILESH AJMERA. EVEN TH E DATES AND THE CASH PAYMENTS WHICH ARE REFLECTED IN PARA-8.2 ARE HAVING SPECIFIC DATE AND MENTIONING THE NAME OF ONE OF PRIME PERSON OF THE G ROUP I.E. MR. CHIRAG SHAH, WHO WAS INDULGE IN THE LAND DEAL IN MOST OF T HE TRANSACTION OF THE GROUP WHICH IS EVIDENT FROM THE APPELLANTS SUBMISS ION. EVEN I FIND THAT MR. NILESH AJMERA, THE DIRECTOR OF THE APPELLANT CO MPANY HAS TAKEN NAME OF SHRI CHIRAG SHAH, FOR PURCHASE OF DEVGURADIA LAN D DEAL IN THE STATEMENT RECORDED AS ON 25/11/11. FURTHER TO THAT, IT IS ALSO VERY IMPORTANT ASPECT OF THE ISSUE THAT THE APPELLANT CO MPANY HAS MADE A SUBSTANTIAL PAYMENT TO A ARCHITECT FIRM M/S DELLA I TALIA FOR SURVEY OF THE LAND. THIS PAYMENT WHICH IS MADE BY ACCOUNT PAYEE C HEQUE BY APPELLANT COMPANY EVIDENCED TO THE FACT THAT THE APPELLANT CO MPANY HAS ENTERED INTO THE TRANSACTION FOR THE PURCHASE OF DEVGURADIA LAND. THEN AFTER ONLY ANY PERSON CAN ASK FOR SURVEY OF THE LAND. NO ONE W ILL MAKE SO MUCH PAYMENT WITHOUT HAVING ANY RIGHT OVER THE SAID LAND . IN VIEW OF THESE STATED FACTS OF THE APPELLANTS CASE, I AM NOT INCL INED TO ACCEPT THE APPELLANTS A/R REQUEST. IN VIEW OF THE SAME, AS TH E CASH PAYMENT AS NOTED BY A.O. IN THE ASSESSMENT ORDER DULY REFLECT FROM THE SHEET TAKEN FROM COMPUTER OF THE APPELLANT COMPANY. BESIDES THI S, THE TRANSACTION CO- RELATES WITH THE BS-8 DIARY ETC. AS NARRATED ABOVE. IN VIEW OF THE SAME, I CONSIDER IT PROPER AND APPROPRIATE TO HOLD THAT THE ADDITION MADE BY A.O. TO THE EXTENT OF RS.3,26,33,000/- IN A.Y.-08-09 IS JUSTIFIED AND CORRECT, AS THE SAME IS BASED UPON THE TRANSACTION NOTED IN THE SEIZED DOCUMENTS AS PAYMENT MADE IN CASH. ACCORDINGLY THE ADDITION SO M ADE BY A.O. IN THE HANDS OF THE APPELLANT COMPANY OF RS.3,26,33,000/- IS CONFIRMED IN THE PHOENIX LEISURE AND LIFESTYLE (SS)195 OF 2013 AND OTHERS 18 HANDS OF THE APPELLANT COMPANY. THUS, THESE GROUNDS OF APPEAL ARE DISMISSED. 10.6 HOWEVER I AM NOT INCLINED TO ACCEPT THE A.O.S THIS VERSION OF ESTIMATION OF PAYMENT OF RS.3,62,17,000/- IN A.Y.-0 9-10, WHICH IS MERELY BASED ON PRESUMPTION AND INFERENCE FROM THE ESTIMAT ION OF PROPOSED INVESTMENT BY THE APPELLANT COMPANY AS DEPICTED BY A.O. IN PARA-8.8 AND 8.9 OF THE ORDER. MERELY ON ASSUMPTION AND PRESUMPT ION, THE ADDITION CANNOT BE MADE UNLESS AND UNTIL THE SAME IS EVIDENC ED WITH CORROBORATIVE DOCUMENTATION FOR SUCH PAYMENT. AS NO SUCH DETAILS WERE FOUND NOTED BY A.O. IN ANY OF THE SEIZED MATERIAL AS HE HAS NOT PO INTED OUT OF ANY SUCH REFERENCE. IN VIEW OF THE SAME, I CONSIDER IT PROPE R AND APPROPRIATE TO HOLD HERE THAT THE A.O.S WORKING OF UNEXPLAINED EXPENDI TURE OF RS.3,62,17,000/- IN A.Y.-09-10 IN THE HANDS OF THE APPELLANT COMPANY IN PARA-8.9 AND 8.10 OF THE ORDER IS COMPLETELY INCORR ECT AND UNJUSTIFIED. THE EFFECT OF THIS OBSERVATION WILL BE GIVEN IN THE APP ELLATE ORDER OF THE APPELLANT COMPANY IN A.Y.-09-10. WITH THIS OBSERVAT ION, THE APPELLANTS GROUNDS OF APPEAL ARE ADJUDICATED. THE LD. AR HAS MADE ORAL SUBMISSION AS WELL AS WRIT TEN SUBMISSION AS UNDER: DURING THE COURSE OF THE ENTIRE SEARCH PROCEEDINGS IN THE CASE OF THE GROUP COMPANIES OR IN THE VARIOUS PREMISES OF THE D IRECTORS OF THE ASSESSEE COMPANY, NOT A SINGLE SALE DEED, SALE AGRE EMENT, SAUDA CHITTHI OR ANY OTHER CORROBORATIVE EVIDENCE WAS FOUND OR RE COVERED FROM WHICH IT COULD HAVE BEEN ESTABLISHED THAT THE ASSESSEE MADE ANY INVESTMENT FOR THE PURCHASE OF ANY LAND AT VILLAGE DEVGURADIA. IT IS FURTHER SUBMITTED THAT IN NONE OF THE LOOSE PAPERS OR COMPU TER PRINT OUTS THE NAME OF THE ASSESSEE COMPANY IS GETTING REFLECTED. IT IS SUBMITTED THAT THE AO HAS MADE A REFERENCE OF A DIARY I.E. BS-8 WHICH, ACCORDING TO THE AO HIMSELF, DOES NOT BELONG TO OR PERTAIN TO THE ASSES SEE COMPANY BUT IT PERTAINS ONLY TO SHRI NILESH AJMERA. IT IS SUBMITTE D THAT THE LEARNED AO HIMSELF, AT PARA 8.1 OF HIS ORDER, HAS GIVEN A FIND ING THAT ON THE PERUSAL OF VARIOUS DOCUMENTS SEIZED DURING THE COURSE OF SE ARCH PROCEEDINGS, DISCUSSED ABOVE, AND COMPUTER PRINT OUTS, IT IS SEE N THAT SHRI NILESH AJMERA HAD MADE PAYMENTS REGARDING SOME LANDS AT VI LLAGE DEVGURADIA, INDORE.. FURTHER, AT LAST PARA OF PAGE NO. 27 OF THE ASSESS MENT ORDER, THE AO HAS AGAIN STATED THAT SHRI NILESH AJMERA WAS THE MAIN PERSON BEHIND DEVGURADIA LAND DEAL. NOW, WITHOUT ADMITTING THAT S HRI NILESH AJMERA MADE ANY PAYMENT, IT IS SUBMITTED THAT EVEN IF IT I S PRESUMED THAT SHRI NILESH AJMERA MADE SOME PAYMENTS FOR PURCHASE OF SO ME LANDS AT VILLAGE PHOENIX LEISURE AND LIFESTYLE (SS)195 OF 2013 AND OTHERS 19 DEVGURADIA, THEN HOW THE ADDITION CAN BE MADE IN TH E HANDS OF THE ASSESSEE WHICH IS AN ALTOGETHER DIFFERENT ENTITY. I T IS SUBMITTED THAT ON THE BASIS OF LOOSE PAPERS OR DIARY OR COMPUTER P RINT OUTS FOUND OR RECOVERED FROM THE POSSESSION AND CONTROL OF A THIR D PERSON, NO ADDITION WAS WARRANTED WITHOUT BRINGING ANY CORROBORATIVE EV IDENCE OR MATERIAL ON RECORD. IT SHALL BE APPRECIATED THAT SINCE THE SUBJ ECT INCRIMINATING MATERIALS WERE NOT FOUND IN THE POSSESSION AND CONT ROL OF THE ASSESSEE COMPANY OR ANY OF ITS DIRECTORS, THE PRESUMPTION AS CONTEMPLATED UNDER THE PROVISIONS OF S.292C WAS NOT AVAILABLE TO THE A O FOR MAKING THE IMPUGNED ADDITION. THE PROVISIONS OF S.292C HAVE B EEN INSERTED IN THE STATUTE BY THE FINANCE ACT, 2007 W.R.E.F. 1.10.1975 TO EMPOWER THE INCOME TAX AUTHORITIES TO MAKE CERTAIN PRESUMPTIONS ON BOOKS OF ACCOUNT, OTHER DOCUMENTS, MONEY, BULLION, JEWELLERY OR OTHER VALUABLE ARTICLE OR THING FOUND IN THE POSSESSION OR CONTROL OF ANY PERSON IN THE COURSE OF A SEARCH UNDER S.132 EVEN FOR THE PURPOSE OF ASSESSMENT. SUCH PROVISION HAS BEEN INSERTED IN THE BACKGROUND OF DE CISION OF HONBLE APEX COURT IN THE CASE OF P.R. METRANI VS. CIT (2006) 28 7 ITR 209 (SC) IN WHICH THE APEX COURT HELD THAT THE PRESUMPTION UNDE R S.132(4A) IS NOT AVAILABLE FOR THE ASSESSMENT PROCEEDINGS. THE PHRAS EOLOGY USED IN SUB- SECTION (1) OF SECTION 292C ARE PARI-MATERIA WITH T HAT OF SECTION 132(4A). NOW, IT MAY BE APPRECIATED THAT MANY JUDICIAL AUTHO RITIES IN THE CONTEXT OF PROVISIONS OF SECTION 132(4A) HAVE CLEARLY LAID DOW N THE RATIO THAT THE PRESUMPTION UNDER S.132(4A) IS AVAILABLE ONLY AGAIN ST THE PERSON FROM WHOSE POSSESSION THE DOCUMENT IS FOUND AND SUCH PRE SUMPTION IS NOT AVAILABLE AGAINST ANY THIRD PARTY. SOME OF THE RELE VANT DECISIONS ARE THAT IN THE CASE OF SMT. BOMMANA SWARNA REKHA VS. ACIT ( 2005) 94 TTJ (VISAKHA) 885, STRAPTEX (INDIA) (P) LTD. VS. DCIT (2003) 79 TTJ (MUMBAI) 228, JAYA S. SHETTY VS. ACIT (1999) 64 TTJ (MUMBAI) 551, ASHWANI KUMAR VS. ITO (1992) 42 TTJ (DEL) 644, KISHANCHAND SOBHRAJMAL VS. ACIT (1992) 42 TTJ (JP) 423, RAMA TRADERS VS. FIRST ITO (1988) 32 TTJ (PAT) 483 (TM), ACIT VS. KISHORE LAL BALWANT RAI & ORS. (2007) 17 SOT 380 (CHD), SHETH AKSHAY PUSHPAVADAN VS. DCIT (2010) 130 TTJ (AHD)(UO) 42. IT IS ALSO A SETTLED LAW THAT THE ADD ITIONS CANNOT BE MADE ON THE BASIS OF DUMB DOCUMENTS FOUND DURING THE COURSE OF SEARCH. FOR SUCH PROPOSITION, WE PLACE RELIANCE IN THE FOLLOWING CAS ES: S NO PARTICULARS OF CASE CITATION JCB PAGE NO. FROM TO 1 ACIT VS. SATYAPAL WASSAN (2008) 5 DTR 202 (JAB) 289 295 2 BRIJLAL RUPCHAND VS. ITO (1991) 40 TTJ 668 (INDORE) 296 300 3 EMBEE CLEARING & SHIPING SERVICES (P) LTD. VS. ACIT (2007) 12 SOT 227 (MUM) 301 307 PHOENIX LEISURE AND LIFESTYLE (SS)195 OF 2013 AND OTHERS 20 IT IS SUBMITTED THAT ALTHOUGH THE AO HAS HELD THAT THE ASSESSEE COMPANY MADE PURCHASES OF CERTAIN LAND AT VILLAGE DEVGURADI A BUT THE NECESSARY DETAILS SUCH AS THE EXACT LOCATION OF THE LAND, THE DATE OF PURCHASE OR PURCHASE AGREEMENT, THE NAME OF THE SELLERS OF THE LAND ETC. COULD NOT BE BROUGHT ON RECORD BY THE AO WITH ANY MATERIAL. THE AO COULD NOT EVEN IDENTIFY THE SELLERS OF THE ALLEGED LAND DEAL. THE AO ALSO DID NOT MAKE ANY INDEPENDENT ENQUIRY FROM THE OFFICE OF THE SUB-REGI STRAR OF THE PROPERTY AS TO WHETHER ANY LAND IN THE OWNERSHIP OF THE ASSE SSEE OR EVEN IN THE OWNERSHIP OF ANY OF ITS DIRECTORS WERE RECORDED IN THE RECORD OF THE SUB- REGISTRAR OF PROPERTY. WITHOUT PREJUDICE TO THE ABOVE, IT IS SUBMITTED THA T THE EXCEL SHEET RELIED UPON BY THE LEARNED AO DOES NOT CONVEY ANY DETAIL R EGARDING ALLEGED PURCHASE OF THE DEVGURADIA LAND. ON SUCH EXCEL SHEE T, EVEN THE WORDS LIKE DEVGURADIA, SAHARA, PURCHASES, ETC. HAVE NOT BEEN STATED FROM WHICH THERE COULD HAVE BEEN ANY REASON TO SUSPECT T HAT SUCH EXCEL SHEET PERTAINS TO SOME DEVGURADIA OR SAHARA PURCHASE DEAL . FURTHER, THE CAPTION OF SUCH EXCEL SHEET DOES NOT MATCH WITH THE DESCRIPTION GIVEN IN THE TABLE BELOW OF SUCH CAPTION. FURTHERMORE, IN SU CH EXCEL SHEET, ONE TOTAL (B) HAS BEEN GIVEN WHICH SUGGESTS THAT THERE MUST BE SOME OTHER TOTAL (A) ALSO WHICH IS NOT THERE ON THE ALLEGED LO OSE PAPER. EVEN THE DETAILS MENTIONED IN THE REMARK COLUMN WITH THE N ARRATIONS 2 ACRE ASHWIN DEAL, CANNOT BE ASSOCIATED WITH THE ALLEGED DEVGURADIA DEAL. IT IS SUBMITTED THAT IN THE SAID EXCEL SHEET, THERE IS A REFERENCE OF SHRI CHIRAG SHAH, WHO IS ONE OF THE DIRECTORS OF M/S. PH OENIX DEVCONS PVT. LTD., WHOSE POSSESSION THE SAID EXCEL SHEET WAS FOU ND. IT IS SUBMITTED THAT UNDISPUTEDLY, SHRI CHIRAG SHAH IS NOT THE SELL ER OF THE LAND AT DEVGURADIA. THE AO DESPITE CARRYING OUT SIMULTANEOU S ASSESSMENT PROCEEDINGS IN THE CASE OF SHRI CHIRAG SHAH HAS NOT OBTAINED ANY EXPLANATION OF SHRI CHIRAG SHAH ON THE ISSUE. IT IS SUBMITTED THAT THE SAID PAYMENTS MIGHT HAVE BEEN MADE BY THE ABOVE NAMED M/ S. PHOENIX DEVCONS PVT. LTD. ONLY TO VARIOUS FARMERS FROM WHIC H IT HAD PURCHASED LAND FOR ITS PHOENIX TOWN PROJECT. IT IS SUBMITTED THAT IN THE ASSESSMENT OF M/S. PHOENIX DEVCONS PVT. LTD., IT HAS GOT ESTABLIS HED THAT M/S. PHOENIX DEVCONS PVT. LTD. THROUGH ITS DIRECTOR SHRI CHIRAG SHAH, SHRI NILESH AJMERA AND OTHERS HAD MADE UNACCOUNTED PAYMENTS TOW ARDS PURCHASES OF LAND FOR THEIR OWN PROJECT AND HUGE ADDITIONS WE RE MADE IN THE ASSESSMENTS OF M/S. PHOENIX DEVCONS PVT. LTD. BY TH E SAME AO. IT IS SUBMITTED THAT THE EXCEL SHEET RELIED UPON BY THE A O DOES NOT ESTABLISH THAT THE ASSESSEE MADE ANY PAYMENT FOR PURCHASE OF ANY LAND AT DEVGURADIA.SHRI NILESH AJMERA FROM WHOSE PREMISES T HE ALLEGED BS-8 DIARY WAS SEIZED, HAD ALSO CATEGORICALLY DENIED TO HAVE MADE ANY PAYMENT TOWARDS PURCHASE OF DEVGURADIA LAND WHICH I S EVIDENT FROM THE AOS OWN FINDING GIVEN AT PARA 8.4 OF THE ASSESSMEN T ORDER. EVEN DURING THE COURSE OF THE ASSESSMENT PROCEEDINGS, THE ASSES SEE HAD SPECIFICALLY REQUESTED THE AO TO PROVIDE THE COPIES OF ANY EVIDE NCE IN POSSESSION OF PHOENIX LEISURE AND LIFESTYLE (SS)195 OF 2013 AND OTHERS 21 THE REVENUE IN SUPPORT OF ALLEGATION OF PURCHASE OF ANY ALLEGED LAND, AS IS EVIDENT FROM PARA 8.7(IV) AT PAGE NO. 31 OF THE AO S ORDER BUT THE AO FAILED TO PROVIDE ANY EVIDENCE IN SUPPORT OF HIS AL LEGATION. THE SUBJECT ADDITION HAS BEEN MADE BY THE AO ONLY ON ERRONEOUS ASSUMPTIONS AND PRESUMPTIONS AND EXTRANEOUS CONSIDERATIONS WITHOUT HAVING ANY COGENT MATERIAL OR EVIDENCE ON RECORD AND, THEREFORE, SUCH ADDITION IS LIABLE TO BE STUCK OFF IN ITS ENTIRETY. IN VIEW OF THE ABOVE FAC TS AND CIRCUMSTANCES OF THE CASE, NO ADDITION DESERVES TO BE MADE IN THE HANDS OF THE ASSESSEE COMPANY ON THIS COUNT AND ACCORDINGLY, THE GROUNDS OF THE ASSESSEE DESERVE TO BE ALLOWED. THE LD. DR HAS RELIED ON THE ORDER OF THE ASSESSING OFFICER. WE HAVE HEARD RIVAL CONTENTIONS AND PERUSED THE MAT ERIAL ON RECORD. WE FIND THAT IN THIS CASE, THE ASSESSEES GROUND NO.1 HAS A LREADY BEEN ALLOWED BY US BY HOLDING THE ENTIRE ASSESSMENT PROCEEDINGS U/S 153C AS NULL AND VOID AND THEREFORE, IT IS NOT NECESSARY TO GIVE SEPARATE FINDING ON THIS ISSUE. H OWEVER, WE FIND THAT DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSEE HAS ASKED THE ASSESSING OFFICER TO PROVIDE DETAILS OF THE ALLEGED LAND SUCH AS ITS EXA CT LOCATION, DATE OF PURCHASE, PURCHASE AGREEMENT, NAME OF THE SELLERS ETC. BUT THE ASSESSI NG OFFICER HAS NOT EVEN IDENTIFIED THE SELLERS OF THE LAND. WE FIND THAT THE ASSESSING OFFICER HAS NOT MADE ANY INQUIRY FROM THE OFFICE OF SUB-REGISTRAR OF THE PROPERTY THAT WH ETHER ANY ALLEGED LAND WAS REGISTERED IN THE NAME OF THE ASSESSEE. IN OUR VIEW, EVEN ON M ERITS, THE ADDITION CANNOT BE SUSTAINED. THEREFORE, THIS GROUND OF THE ASSESSEE I S ALLOWED. DEPARTMENTAL GROUND NO. 1 THE REVENUE HAS TAKEN THIS GROUND OF APPEAL AGAINS T THE ACTION OF THE LD. CIT(A) IN DECIDING THE APPEAL AGAINST THE PRINCIPLES OF NA TURAL JUSTICE, WITHOUT AFFORDING ANY OPPORTUNITY TO THE AO OR REMANDING IT BACK IN VIOLA TION OF THE DEPARTMENTAL INSTRUCTION THAT IN SEARCH ASSESSMENTS APPEAL ORDER BE PASSED E ITHER BASED ON REMAND REPORT OR AFTER HEARING THE AO. PHOENIX LEISURE AND LIFESTYLE (SS)195 OF 2013 AND OTHERS 22 THE LD. AR HAS RELIED UPON THE ORDER OF THE LD. CIT (A) AND HE HAS ORALLY ARGUED THAT THE LD. CIT(A) HAS ALL THE POWERS TO MAKE THE DIRECTION AS DEEM FIT. LD. AR FILED WRITTEN SUBMISSION, WHICH READS AS UNDER: AT THE OUTSET, IT IS SUBMITTED THAT THE NECESSARY PROVISIONS PRESCRIBING FOR PROCEDURE OF AN APPEAL BEFORE THE COMMISSIONER (APP EALS) ARE CONTAINED IN SECTION 250 OF THE INCOME-TAX ACT, 1961. AS PER THE PROVISIONS OF SUB- SECTION (1) OF S. 250, THE COMMISSIONER (APPEALS) I S REQUIRED TO GIVE A NOTICE OF THE APPEAL TO THE ASSESSEE AND AS ALSO TO THE CONCERNING ASSESSING OFFICER. IT IS SUBMITTED THAT NO FORM HAS BEEN STATUTORILY PRESCRIBED EITHER UNDER THE INCOME-TAX ACT, 1961 OR INCOME-TAX RULES, 1962 FOR ISSUANCE OF THE NOTICE CONTEMPLATED UNDER S. 250. HOWEVER, UPON RECEIPT OF THE APPEAL FROM THE SIDE OF ASSESSE E, AS PER THE CBDTS INSTRUCTIONS, A FORM TITLED AS ITNS-51, SEEKING WIL LINGNESS OF THE AO TO APPEAR AT THE APPELLATE STAGE, IS ISSUED AND THEREU PON THE ASSESSING OFFICER HAS TO COMMUNICATE HIS WILLINGNESS TO THE C IT (A) WITHIN 10 DAYS FROM THE RECEIPT OF SUCH ITNS-51. FURTHER, A COPY O F THE APPEAL MEMO IN THE PRESCRIBED FORM NO.35 ALONG WITH THE GROUNDS OF APPEAL TAKEN BEFORE THE CIT(A) ARE ALSO PROVIDED BY THE CIT (A) TO THE CONCERNING ASSESSING OFFICER. IN THE INSTANT CASE, UNDISPUTEDLY, A NOTIC E IN ITNS-51 WAS ISSUED AND SERVED UPON THE CONCERNING ASSESSING OFFICER. A COPY OF THE APPEAL MEMO ALONG WITH THE GROUNDS OF APPEAL WERE ALSO PRO VIDED TO THE CONCERNING ASSESSING OFFICER. IT IS ALSO UNDISPUTED THAT THE ASSESSING OFFICER DID NOT EXPRESS HIS WILLINGNESS TO MAKE HIS PERSONAL APPEARANCE BEFORE THE CIT (A) DURING THE COURSE OF THE APPELLA TE PROCEEDINGS. IN THE SIMILAR CIRCUMSTANCES, THIS HONBLE BENCH, IN THE C ASE OF CIT VS. KALANI INDUSTRIES LTD. (2007) 8 ITJ 165 (INDORE TRIB.) AT PAGE NO.249 AND 250, HAS HELD THAT THE ENTITLEMENT OF THE AO TO APPEAR B EFORE CIT (A) COULD BE EXERCISED BY OPTING TO APPEAR AND JOIN THE APPELLAT E PROCEEDINGS AND UNLESS SUCH OPTION IS EXERCISED BY THE AO, THERE CA NNOT BE ANY CASE OF DENIAL OF NATURAL JUSTICE TO THE REVENUE OR CAUSING ANY PREJUDICE TO THE PHOENIX LEISURE AND LIFESTYLE (SS)195 OF 2013 AND OTHERS 23 REVENUE. AS REGARD THE SO-CALLED DEPARTMENTAL INSTR UCTION FOR CALLING THE REMAND REPORT IN SEARCH APPEAL CASES, IT IS SUBMITT ED THAT FIRST OF ALL ANY INSTRUCTION FROM THE CBDT IS NOT BINDING UPON THE A SSESSEE AND EVEN OTHERWISE ANY SUCH INSTRUCTION IS ONLY DIRECTIVE IN NATURE AND NOT MANDATORY. ALTHOUGH THERE IS NO STATUTORY REQUIREME NT FOR CALLING ANY REMAND REPORT FROM THE AO, BUT DESPITE SUCH FACT, T O THE BEST OF KNOWLEDGE AND BELIEF OF THE ASSESSEE, THE LEARNED C IT (A) HAD CALLED FOR NECESSARY DETAILS AND REPORTS FROM THE AO BUT THERE WAS NO COMPLIANCE AS SUCH BY THE THEN AO. IT IS SUBMITTED THAT IN THE INSTANT CASE, THE LEARNED CIT (A) HAS FRAMED THE APPELLATE ORDER BY TAKING IN TO FULL CONSIDERATION VARIOUS OBSERVATIONS AND FINDINGS OF THE ASSESSING OFFICER, SEIZED MATERIAL, WRITTEN SUBMISSIONS AND VARIOUS DOCUMENTARY EVIDENC ES FURNISHED BY THE ASSESSEE. IT IS SUBMITTED THAT THE LEARNED CIT (A) HAS NOT ADMITTED ANY ADDITIONAL EVIDENCE IN VIOLATION OF RULE 46A OF THE INCOME-TAX RULES, 1962. MOREOVER, TO ISSUE A DIRECTION TO THE ASSESSI NG OFFICER FOR CONDUCTING ANY FURTHER INQUIRY OR FOR SUBMITTING ANY FURTHER R EPORT, UNDER THE PROVISIONS OF SUB-SECTION (4) OF S. 250 IS DISCRETIONARY AND N OT MANDATORY. IT IS SUBMITTED THAT ANY ORDER VALIDLY PASSED BY THE FIRS T APPELLATE AUTHORITY AFTER GIVING FULL THOUGHTFUL CONSIDERATION TO THE AOS OR DER AND MATERIALS WHICH WERE ALSO ON RECORD OF THE AO, CANNOT BE LEVELED AS AN ORDER AGAINST THE PRINCIPLES OF NATURAL JUSTICE FOR THE ONLY REASON T HAT THE PROVISIONS OF S. 250 (4) WERE NOT INVOKED BY THE CIT (A). IN VIEW OF THE ABOVE FACTS AND CONSIDERING THE DIRECT JUDGMENT OF THIS HONBLE BEN CH IN THE CASE OF M/S. KALANI INDUSTRIES (SUPRA), THE FIRST GROUND OF APPE AL OF THE REVENUE DESERVES TO BE DISMISSED IN LIMINE. THE LD. DR RELIED ON THE ORDER OF THE ASSESSING OFF ICER. WE HAVE HEARD THE RIVAL CONTENTIONS OF BOTH THE PAR TIES AND HAVE PERUSED THE MATERIAL AVAILABLE ON RECORD. WE FIND THAT IN THE I NSTANT CASE, THE NOTICE WAS ISSUED TO THE CONCERNED AO. THE AO DID NOT REMAIN PRESENT BEF ORE LD. CIT(A) DURING ASSESSMENT PROCEEDINGS. THE CIT(A) HAS CALLED FOR THE REMAND R EPORT AND AO HAS NOT MADE ANY PHOENIX LEISURE AND LIFESTYLE (SS)195 OF 2013 AND OTHERS 24 COMPLIANCE. THE LD. CIT(A) HAS DIRECTED TO MAKE THE FURTHER INQUIRY WHICH LD. CIT(A) HAS NO POWERS BUT LOOKING INTO THE FACTS AND CIRCUMSTAN CES OF THE CASE, WE FEEL IT APPROPRIATE TO DIRECT THE AO TO MAKE FURTHER INQUIR Y THAT POWERS ARE WELL WITHIN THE JURISDICTION OF THE TRIBUNAL. THEREFORE, IN OUR OPI NION, THE DEPARTMENTAL GROUND DESERVES TO BE DISMISSED AND HENCE, IT IS DISMISSED. DEPARTMENTAL GROUND NOS.2 TO 2.2 THE REVENUE HAS TAKEN THIS GROUND OF APPEAL AGAINS T THE ACTION OF THE LD. CIT(A) IN DELETING THE ADDITION OF RS.3,43,44,220/- UNDER THE HEAD UNACCOUNTED ON MONEY BY EQUATING IT WITH TRADING RECEIPT WITH THE DIRECTION TO THE AO TO TAX THE ON MONEY AFTER ALLOWING CORRESPONDING EXPENDITURE. THE BRIEF FACTS, HAVING A BEARING ON THE ISSUE INV OLVED, ARE THAT DURING THE COURSE OF SEARCH CERTAIN DOCUMENTS, INVENTORIZED AS LPS-A/ 1 AND LPS-A/3 WERE SEIZED FROM THE OFFICE PREMISES OF M/S. PHOENIX DEVCONS PVT. LT D.. FROM SUCH SEIZED DOCUMENTS AND PARTICULARLY, FROM PAGE NO.90 OF LPS-A/3 THE AO NOTED THAT THE ASSESSEE COMPANY HAD RECEIVED SUBSTANTIAL ON-MONEY, AMOUNTING TO RS. 5,00,95,652/- FROM ITS VARIOUS CUSTOMERS AGAINST BOOKING OF FLATS IN ITS PHOENIX GREEN PROJECT IN TWO ASSESSMENT YEARS. THE AO FURTHER NOTED THAT OUT OF THE TOTAL O N-MONEY, A SUM OF RS.3,43,44,220/- WAS RECEIVED BY THE ASSESSEE COMPANY DURING THE PRE VIOUS YEAR UNDER CONSIDERATION AND REMAINING SUM OF RS.1,64,35,000/- WAS RECEIVED IN SUBSEQUENT PREVIOUS YEAR RELEVANT TO A.Y. 2009-10. FINALLY, THE AO MADE AN A DDITION OF RS.3,43,44,220/- IN THE ASSESSEES INCOME BY HOLDING THE ON-MONEY RECEIPT A S INCOME FROM UNDISCLOSED SOURCES OF THE ASSESSEE OF THE RELEVANT PREVIOUS YE AR. THE RELEVANT FINDINGS OF THE PHOENIX LEISURE AND LIFESTYLE (SS)195 OF 2013 AND OTHERS 25 ASSESSING OFFICER ARE RECORDED AT PARA 5.1 AT PAGE NO. 5 TO PARA 5.13 AT PAGE NO. 20 OF THE ASSESSMENT ORDER. MATTER CARRIED TO LD. CIT(A) AND THE LD. CIT(A), A FTER CONSIDERING THE SUBMISSION OF THE ASSESSEE, DELETED THE ADDITION OF RS.3,43,44 ,220/- BY GIVING HIS FINDINGS AT PARA 8.4 TO PARA 8.7 OF HIS ORDER. 8.4 I HAVE CONSIDERED THE A.O.S ORDER AS WELL AS THE A PPELLANTS A/R SUBMISSION. HAVING CONSIDERED BOTH, I AM OF THE CON SIDERED VIEW THAT THERE IS NO DISPUTE TO THE FACT THAT DURING THE REL EVANT PREVIOUS YEAR, EITHER THE APPELLANT OR ITS ONE OF THE DIRECTORS, NAMELY S HRI NILESH AJMERA, HAD RECEIVED ON-MONEY AMOUNTING TO RS.3,43,44,220/-, FR OM ITS VARIOUS CUSTOMERS TOWARDS SALES OF FLATS IN ITS PHOENIX GR EEN PROJECT. THERE IS NO SUBSTANCE IN THE APPELLANTS A/R THIS ARGUMENT THAT SHRI NILESH AJMERA HAS COLLECTED THE ON-MONEY WITHOUT HAVING ANY AUTHO RITY FOR THE SAME. AS SHRI NILESH AJMERA IS ONE OF THE DIRECTORS OF THE A PPELLANT COMPANY WHO ACTIVELY PARTICIPATED IN THE BUSINESS OPERATION OF THE APPELLANT COMPANY, HENCE SUCH KIND OF ASSERTION HAS NOT SUBSTANCE. EVE N THE OTHER ARGUMENTS THAT SHRI NILESH AJMERA HAS COLLECTED THE ADVANCE MONEY IN HIS INDIVIDUAL CAPACITY AND NOT ON BEHALF OF THE APPELL ANT COMPANY CANNOT BE ACCEPTED, AS IT IS NOT POSSIBLE THAT A PERSON WILL GIVE A HARDENED EARNED MONEY FOR BOOKING OF A FLAT WITHOUT ASCERTAINING TH E CORRECTNESS AND THE OUTCOME OF THE SAID PAYMENT. IN VIEW OF THE SAME TH E APPELLANTS A/R ALL SUCH ARGUMENTS IS OF NO SUBSTANCE. THE FACT REMAINE D THAT THE DETAILED NOTED IN LPS-A/1 AND LPS-A/3 CLEARLY REFLECTS THE R ECEIPT OF ON-MONEY WHICH IS ALSO AFFIRM BY THE APPELLANT OWN SUBMISSIO N EXTRACTED ABOVE. THEREFORE, SUCH ON-MONEY RECEIPT HAS TO BE HELD AS TRADING RECEIPTS ONLY AND IT SHOULD BE REGARDED ONLY AS THE UNDISCLOSED I NCOME OF THE APPELLANT. HAVING HELD THAT THE ON-MONEY IS UNDOUBTEDLY IS TAX ABLE BEING TRADING RECEIPT. THUS, IN THE PERSPECTIVE, IT IS ESSENTIAL TO ASCERTAIN THAT IN WHICH YEAR SUCH ON-MONEY RECEIPT SHOULD BE RECOGNIZED AS AN INCOME OF THE APPELLANT. AFTER TAKING NOTE FROM THE JUDICIAL PRON OUNCEMENTS REFERRED BY THE APPELLANTS A/R IN HIS SUBMISSION, IN MY CONSID ERED VIEW, THERE CANNOT BE ANY QUARREL TO THE PROPOSITION THAT ANY TRADING RECEIPT SHOULD BE RECOGNIZED AS AN INCOME OF AN ASSESSEE ONLY IN ACCO RDANCE WITH THE ACCOUNTING METHODS AND PRINCIPLES OBSERVED BY SUCH AN ASSESSEE. ALTHOUGH, IN THE INSTANT CASE, THE BOOKS OF ACCOUNT OF THE APPELLANT HAVE PHOENIX LEISURE AND LIFESTYLE (SS)195 OF 2013 AND OTHERS 26 BEEN HELD TO BE LIABLE FOR REJECTION ( SUPRA ) BUT THE STATUS OF THE APPELLANT BEING THAT OF A COMPANY IT IS NOT PERMISSIBLE FOR I T TO OBSERVE CASH SYSTEM OF ACCOUNTING BUT IT HAS TO FOLLOW ONLY MERCANTILE SYSTEM OF ACCOUNTING. IN THE MERCANTILE SYSTEM, ANY RECEIPT CAN BE RECOGNIZE D AS AN INCOME ONLY IN THE YEAR IN WHICH IT ACCRUES AND NOT IN THE YEAR IN WHICH IT IS RECEIVED. IN THE CASE OF AN ASSESSEE CARRYING OUT THE BUSINESS O F REAL ESTATE, THE POINT OF ACCRUAL OF INCOME CAN BE THE YEAR IN WHICH SALES IS COMPLETED BY WAY OF EITHER HANDING OVER THE POSSESSION OF THE PROPER TY SOLD OR BY WAY OF EXECUTING THE SALE-DEED IN FAVOUR OF THE BUYER, WHI CHEVER EVENT OCCURS FIRST. IN THE INSTANT CASE, IT IS AN ADMITTED POSIT ION THAT DURING THE RELEVANT PREVIOUS YEAR, NO SALES TOOK PLACE WHICH IS EVIDENT FROM THE AUDITED FINANCIAL STATEMENTS OF THE APPELLANT AS CLAIMED BY THE APPELLANT THROUGH ITS SUBMISSION. EVEN IT IS NOT THE CASE OF THE AO T HAT DURING THE PERIOD UNDER CONSIDERATION THE APPELLANT MADE ANY SALES. I AM IN CONCURRENCE WITH THE CONTENTION OF THE APPELLANT THAT HAD ANY S ALES TAKEN PLACE DURING THE YEAR, THE AO, BESIDES MAKING THE ADDITION ON AC COUNT OF ON-MONEY, WOULD HAVE ALSO MADE THE CORRESPONDING ADDITION IN RESPECT OF THE ADVANCE RECORDED BY THE APPELLANT IN ITS BOOKS OF A CCOUNT WHICH IS CERTAINLY NOT A CASE HERE. THE AO HAS NOT TAKEN AN ADVERSE VIEW IN RESPECT OF THE RECORDED RECEIPT OF ADVANCE SHOWN BY THE APPELLANT IN ITS BOOKS AS WELL AS AUDITED FINANCIAL STATEMENTS AT RS .1,84,93,005/-. IF THE RECORDED TRADING RECEIPTS OF ADVANCES ARE TREATED A ND RIGHTLY SO, AS A LIABILITY ONLY, THE UNRECORDED TRADING RECEIPT IN F ORM OF THE ON-MONEY EMANATED FROM THE SAME TRANSACTION CANNOT BE TREATE D AS IN THE NATURE OF INCOME AND SUCH UNRECORDED TRADING RECEIPTS TOO HAV E TO BE REGARDED AS LIABILITY ONLY. SUCH UNRECORDED TRADING RECEIPTS, B Y WAY OF ADVANCE, WOULD ASSUME THE CHARACTER OF INCOME OF THAT YEAR ONLY IN WHICH THE SALES IS EFFECTED, AS DISCUSSED ABOVE. THE CASE-LAWS RELIED UPON BY THE APPELLANT VIZ. FORT PROJECTS (P) LTD. VS. DY. CIT REPORTED AS (2011 63 DTR TRIB. (KOL.) AND DHANVARSHA BUILDERS & DEVELOPERS PVT. LT D. VS. DY. CIT (2006) 105 TTJ (PUNE) 376 SQUARELY APPLY TO THE PRESENT SET OF FACTS AND FORT IFIES THE VIEWS TAKEN ABOVE. ACCORDINGLY, THE ADDITION OF RS.3,43,44,220/- MADE BY THE AO ON ACCOUNT OF ON-MONEY RECEIVED ON THE P HOENIX GREEN PROJECT IS HEREBY DELETED IN THE PRESENT ASSESSMENT YEAR. 8.5 HAVING HELD AS ABOVE, IN MY CONSIDERED VIEW, IT IS ESSENTIAL TO ADJUDICATE HERE ABOUT THE TAXABILITY OF SUCH ON-MON EY RECEIPT BY THE APPELLANT COMPANY AS UNACCOUNTED TRADING RECEIPT. A S THE AFORESAID ON- MONEY WERE RECEIVED MERELY ON ACCOUNT OF SALE OF FL AT OF THE APPELLANT COMPANY WHICH WAS RECEIVED EITHER BY THE APPELLANT COMPANY OR BY SHRI NILESH AJMERA, THE DIRECTOR OF THE APPELLANT COMPAN Y WHICH WAS DULY PHOENIX LEISURE AND LIFESTYLE (SS)195 OF 2013 AND OTHERS 27 RECORDED IN THE SEIZED DOCUMENTS AS NOTED BY A.O. I N THE ASSESSMENT ORDER. HENCE AS THE SUCH RECEIPT OF ON-MONEY WAS AS A RESULT OF SALE OF APPELLANT COMPANYS STOCK IN TRADE AND HENCE IT HAS TO BE HELD THAT SUCH ON-MONEY RECEIPT IS THE UNACCOUNTED TRADING RECEIPT OF THE APPELLANT COMPANY ONLY. HENCE THE SAME WILL BE TAXABLE IN THE HANDS OF THE APPELLANT COMPANY ONLY AS UNACCOUNTED RECEIPT. HOWE VER I AM IN AGREEMENT WITH THE APPELLANTS A/R THIS REQUEST THA T SUCH UNACCOUNTED RECEIPT HAS TO BE TAXED AS PER ACCOUNTING PRINCIPLE ADOPTED BY THE APPELLANT COMPANY. 8.6 WITH THE AFORESAID DISCUSSION AS GIVEN IN THE AFORE SAID PARAS FOR TAXABILITY OF ON-MONEY, IT WILL BE NECESSARY ON MY PART TO ALSO ADJUDICATE THAT THE TAXABILITY OF ON-MONEY SO RECEIVED IN THE HANDS OF THE APPELLANT COMPANY. ON THE BASIS OF AFORESAID DISCUSSION OF TA XABILITY OF INCOME AND ALSO METHOD OF ACCOUNTING FOLLOWED BY THE APPELLANT AND DIFFERENT JUDICIAL PRONOUNCEMENTS AS REFERRED ABOVE (SUPRA), I AM OF T HE CONSIDERED VIEW THAT IT IS UNDOUBTEDLY CORRECT AND JUSTIFIED TO HOL D THAT ON-MONEY SO RECEIVED TO THE APPELLANT COMPANY, WHICH RESULTED T O THE APPELLANT IN THE COURSE OF ITS BUSINESS ACTIVITY IS A BUSINESS RECEI PT AND HENCE THE SAME HAS TO BE TAXED AS UNDISCLOSED INCOME OF THE APPELL ANT IN ACCORDANCE TO THE PROVISIONS OF LAW AND THE METHOD OF ACCOUNTING. THUS, ONE THING IS COMPLETELY CLEAR AND ESTABLISHED THAT ENTIRE ON-MO NEY OF THE APPELLANT IS A UNACCOUNTED BUSINESS RECEIPT IN THE HANDS OF THE APPELLANT, WHICH IS BY ITS NATURE TAXABLE AS UNDISCLOSED INCOME IN THE HAN DS OF THE APPELLANT COMPANY, AS THE SAME DID NOT FIND PLACE OF RECORD I N THE REGULAR BOOKS OF ACCOUNTS OF THE APPELLANT COMPANY. THEREFORE I CONS IDER IT PROPER AND APPROPRIATE TO DIRECT THE A.O. TO TAX THE ON-MONEY IN THE HANDS OF THE APPELLANT COMPANY AFTER ALLOWING CORRESPONDING EXPE NDITURE SO INCURRED ON ACCOUNT OF ON-MONEY, IF ANY RECORDED ON THE SAME SET OF PAPER, WHICH IS SEIZED BY THE DEPARTMENT, WHICH FIND PLACE OF ME NTION OF INCURRING ANY SUCH EXPENDITURE IN RELATION TO THE PROJECT WHICH R ESULTED THE RECEIPT OF ON- MONEY IN THE HANDS OF THE APPELLANT COMPANY. THUS, THE ON-MONEY HAS TO BE TAXED IN THE RESPECTIVE ASSESSMENT YEAR AS AND W HEN CORRESPONDING SALES RELATED TO SUCH ON-MONEY IS RECOGNIZED. 8.7 IN THE AFORESAID BACKGROUND, THE A.O. SHOULD WORK O UT TAXABILITY OF SUCH UNACCOUNTED RECEIPTS OF ON-MONEY IN RELATION TO SALES EFFECTED BY THE APPELLANT COMPANY CORRESPONDING TO SUCH SALES O F PLOT FOR WHICH SUCH ON-MONEY WAS RECEIVED BY THE APPELLANT COMPANY IN CHEQUE/CAS H, WHICH WAS FOUND RECORDED IN THE REGULAR BOOKS OF ACCOUNTS OF THE APPELLANT PHOENIX LEISURE AND LIFESTYLE (SS)195 OF 2013 AND OTHERS 28 COMPANY. WITH THIS OBSERVATION, APPELLANTS THESE G ROUNDS OF APPEAL ARE ADJUDICATED ACCORDINGLY. THE LD. AR HAS MADE ORAL AS WELL AS WRITTEN SUBMISS ION AS UNDER: IN THE PRESENT CASE, THE FACT REMAINED THAT DURING THE COURSE OF THE SEARCH PROCEEDINGS, THE VARIOUS LOOSE PAPERS AND FI LES WERE FOUND AND SEIZED AND FROM SUCH SEIZED MATERIAL, IT WAS NOTICE D BY THE AO THAT THE ASSESSEE HAD RECEIVED ON-MONEY AMOUNTING TO RS.3,4 3,44,220/- AND RS.1,64,35,000/- AGGREGATING TO A SUM OF RS.5,07,79 ,220/- RESPECTIVELY IN TWO ASSESSMENT YEARS VIZ. A.Y. 2008-09 AND A.Y. 200 9-10. IT IS SUBMITTED THAT RECEIPT OF SUCH ON MONEY WAS ADMITTED BY THE A SSESSEE COMPANY ITSELF. SUCH ON-MONEY BEING REVENUE RECEIPT IS UNDI SPUTEDLY UNDISCLOSED INCOME OF THE ASSESSEE COMPANY LIABLE FOR TAX. HOWE VER, THE ONLY POINT OF DIFFERENCE BETWEEN THE REVENUE AND US IS THE ASSESS MENT YEAR IN WHICH SUCH ON-MONEY IS TAXABLE. ACCORDING TO THE REVENUE, THE ON-MONEY SHOULD BE TAXED IN THE YEAR IN WHICH IT WAS RECEIVE D WHEREAS ACCORDING TO OUR VIEW, THE ON-MONEY SHOULD BE TAXED IN THE YEAR IN WHICH THE SALES IS RECOGNIZED. IT IS SUBMITTED THAT THE ASSESSEE BEING A COMPANY WAS STATUTORILY REQUIRED TO OBSERVE MERCANTILE SYSTEM O F ACCOUNTING AND THEREFORE, ANY SALES REVENUE CAN BE RECOGNIZED ONLY ON THE PRINCIPLE OF ACCRUAL AND NOT ON THE PRINCIPLE OF CASH RECEIPTS. IT IS FURTHER SUBMITTED THAT THE ASSESSEE RECEIVED BOOKING MONEY FROM ITS C USTOMERS AND A PART OF THE BOOKING MONEY WAS RECORDED IN THE BOOKS OF A CCOUNT WHEREAS OTHER PART WAS NOT SO RECORDED. THE UNRECORDED PART WAS HELD AS ON- MONEY OF THE ASSESSEE BY THE REVENUE BUT THE RECORD ED PART OF THE BOOKING MONEY RECEIVED BY THE ASSESSEE HAS NOT BEEN REGARDED AS INCOME OF THE ASSESSEE. ON THE OTHER HAND, THE SAME HAS BEEN REGARDED AS LIABILITY ONLY AND SUCH A POSITION WAS ALSO AC CEPTED BY THE DEPARTMENT. IT IS SUBMITTED THAT THERE CANNOT BE TWO DIFFERENT ACCOUNTING TREATMENTS FOR THE SAME TRANSACTION AND SAME ACCOUNTING TREATMENT HAS TO BE GIVEN FOR THE RECORDED TRANSACTION AS WELL AS FOR THE UNRECOR DED TRANSACTION. YOUR HONOURS, UNDER S.153C, AO IS REQUIRED TO ASSESS/RE- ASSESS TOTAL INCOME OF AN ASSESSEE. THE EXPRESSION TOTAL INCOME HAS B EEN DEFINED IN SECTION 2(45) OF THE ACT ACCORDING TO WHICH TOTAL INCOME MEANS THE TOTAL AMOUNT OF INCOME REFERRED TO IN SECTION 5, COMPUTED IN THE MANNER LAID DOWN IN THE ACT. THUS, INCOME UNDER THE PROVISIONS OF SECTI ON 153C OF THE ACT HAS TO BE COMPUTED IN ACCORDANCE WITH VARIOUS PROVISION S OF THE ACT AND THEREFORE, IF THE RECORDED BUSINESS INCOME OF THE A SSESSEE IS COMPUTED ON MERCANTILE BASIS, THERE IS ABSOLUTELY NO REASON FOR COMPUTING THE UNRECORDED INCOME EMANATING FROM THE SAME TRANSACTI ONS ON CASH BASIS. IT IS SUBMITTED THAT DURING THE YEAR UNDER APPEAL, THE ASSESSEE HAS NOT EFFECTED ANY SALES AND THEREFORE, BY ANY STRETCH OF IMAGINATION, THE ON- MONEY CANNOT BE SAID TO HAVE FRUCTIFIED IN THE HAND S OF THE ASSESSEE IN THE PRESENT YEAR OF APPEAL. FIOR SUCH PROPOSITION W E PLACE RELIANCE ON THE PHOENIX LEISURE AND LIFESTYLE (SS)195 OF 2013 AND OTHERS 29 DECISION OF HONBLE KOLKATA BENCH OF ITAT IN THE CA SE OF FORT PROJECTS (P) LTD. VS. DY. CIT (2011) 63 DTR TRIB. (KOL.) AND AS ALSO OF HONBLE PUNE BENCH OF ITAT IN THE CASE OF DHANVARSHA BUILDERS & DEVELOPERS PVT. LTD. VS. DY. CIT (2006) 105 TTJ (PUNE) 376 . IT IS SUBMITTED THAT THE CASE LAW OF HEALTHY HOLDINGS PVT. LTD. AS RELIED UPON BY THE RE VENUE IS NOT APPLICABLE IN THE PRESENT CASE AS THE FACTS OF BOTH THE CASES ARE DISTINGUISHABLE. TO SUM UP, IT IS SUBMITTED THAT THERE IS NO INFIRMITY IN THE CIT(A)S DIRECTIONS TO THE AO TO THE EFFECT THAT THE AO SHOULD WORK OUT TA XABILITY OF THE ON-MONEY IN THE YEAR IN WHICH SALE IS FOUND RECORDED IN THE REGULAR BOOKS OF ACCOUNT OF THE ASSESSEE. AS REGARD GRANT OF DEDUCTION OF C ORRESPONDING EXPENDITURE AGAINST THE UNACCOUNTED RECEIPTS OF ON- MONEY, IT IS SUBMITTED THAT THE SOURCES OF INCURRENCE OF EXPENDITURE ARE S ELF EXPLANATORY VIZ. RECEIPT OF ON-MONEY FOR WHICH SEPARATE ADDITIONS WE RE DULY MADE BY THE AO. IT IS SUBMITTED THAT SINCE SUCH EXPENDITURE WER E INCURRED BY THE ASSESSEE IN THE COURSE OF ITS BUSINESS OF DEVELOPIN G A REAL ESTATE PROJECT AND, THEREFORE, SUCH EXPENDITURE CANNOT BE REGARDED AS TO BE ILLEGAL. FOR SUCH PROPOSITION WE RELY ON THE DECISION OF HONBLE KERALA HIGH COURT IN THE CASE OF CIT VS. P.D. ABRAHAM ALIAS APPACHAN & ANR. A S REPORTED IN (2012) 74 DTR (KER.) 34 . THUS, THERE IS NO INFIRMITY IN THE FINDINGS GIVEN BY THE CIT(A). ACCORDINGLY, GROUNDS NO. 2 TO 2.2 OF TH E REVENUE DESERVE TO BE DISMISSED. LD. DR HAS RELIED ON THE ORDER OF THE ASSESSING OFF ICER. WE HAVE HEARD RIVAL CONTENTIONS AND PERUSED THE MA TERIAL AVAILABLE ON RECORD. ALTHOUGH, WE HAVE ALREADY GIVEN FINDING THAT IN THE PRESENT CASE, FRAMING OF ASSESSMENT U/S 153C ARE VOID-AB-INITIO BUT WE DEEM IT NECESSAR Y TO ADJUDICATE THE ISSUE ON MERIT ALSO. LOOKING TO THE FACTS, SUBMISSIONS AND JUDICIA L PRONOUNCEMENTS, WE FIND THAT IN THE INSTANT CASE, IT IS AN ADMITTED POSITION THAT DURIN G THE RELEVANT PREVIOUS YEAR, NO SALES TOOK PLACE WHICH IS EVIDENT FROM THE AUDITED FINANC IAL STATEMENTS OF THE ASSESSEE AS CLAIMED BY THE ASSESSEE THROUGH ITS SUBMISSION. EVE N IT IS NOT THE CASE OF THE AO THAT DURING THE PERIOD UNDER CONSIDERATION THE ASSESSEE MADE ANY SALES. WE ARE OF THE VIEW HAD ANY SALES TAKEN PLACE DURING THE YEAR, THE AO, BESIDES MAKING THE ADDITION ON ACCOUNT OF ON-MONEY, WOULD HAVE ALSO MADE THE CORRE SPONDING ADDITION IN RESPECT OF THE ADVANCE RECORDED BY THE ASSESSEE IN ITS BOOKS O F ACCOUNT WHICH IS CERTAINLY NOT A PHOENIX LEISURE AND LIFESTYLE (SS)195 OF 2013 AND OTHERS 30 CASE HERE. THE AO HAS NOT TAKEN AN ADVERSE VIEW IN RESPECT OF THE RECORDED RECEIPT OF ADVANCE SHOWN BY THE APPELLANT IN ITS BOOKS AS WELL AS AUDITED FINANCIAL STATEMENTS AT RS.1,84,93,005/-. IF THE RECORDED TRADING RECEIPTS OF ADVANCES ARE TREATED AND RIGHTLY SO, AS A LIABILITY ONLY, THE UNRECORDED TRADING RECEIPT IN FORM OF THE ON-MONEY EMANATED FROM THE SAME TRANSACTION CANNOT BE TREATED AS IN T HE NATURE OF INCOME AND SUCH UNRECORDED TRADING RECEIPTS TOO HAVE TO BE REGARDED AS LIABILITY ONLY. SUCH UNRECORDED TRADING RECEIPTS, BY WAY OF ADVANCE, WOULD ASSUME T HE CHARACTER OF INCOME OF THAT YEAR ONLY IN WHICH THE SALES IS EFFECTED, AS DISCUSSED A BOVE. THE CASE-LAWS RELIED UPON BY THE ASSESSEE VIZ. FORT PROJECTS (P) LTD. VS. DY. CIT REPORTED AS (2011 63 DTR TRIB. (KOL.) AND DHANVARSHA BUILDERS & DEVELOPERS PVT. LT D. VS. DY. CIT (2006) 105 TTJ (PUNE) 376 SQUARELY APPLY TO THE PRESENT SET OF FACTS AND FORT IFIES THE VIEWS TAKEN ABOVE. ACCORDINGLY, WE CONFIRM THE FINDINGS OF THE LD. CIT(A) FOR DELETION OF THE ADDITION OF RS.3,43,44,220/- MADE BY THE AO ON ACCOUNT OF ON -MONEY RECEIVED ON THE PHOENIX GREEN PROJECT. THUS, DEPARTMENTAL GROUNDS ON THIS ISSUE ARE DISMISSED. DEPARTMENTAL GROUND NOS.2.3 TO 2.5 THE DEPARTMENT HAS TAKEN THIS GROUND OF APPEAL AGA INST THE ACTION OF THE LD. CIT(A) IN DIRECTING THE AO TO VERIFY THE SOURCE OF CASH DEPOSITS OF RS.22,85,000/- ADDED BY THE AO AS UNEXPLAINED CASH CREDITS U/S 68 OF THE I.T. ACT IN THE BANK ACCOUNTS OF THE ASSESSEE. THE BRIEF FACTS RELATING TO THE GROUND ARE THAT DU RING THE COURSE OF THE ASSESSMENT PROCEEDINGS, THE AO NOTED FROM THE BANK STATEMENT OF THE ASSESSEE THAT IT HAD MADE CASH DEPOSITS AMOUNTING TO RS.22,85,000/-, ON DIFFERENT DATES, IN ITS BANK ACCOUNT WITH HDFC BANK. THE AO, IN THE BODY OF THE ASSESSMENT ORDER, HAS NOTED THE PHOENIX LEISURE AND LIFESTYLE (SS)195 OF 2013 AND OTHERS 31 DIFFERENT DATES ON WHICH THE SAID CASH DEPOSITS WER E MADE. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE AO REQUIRED THE ASSESSE E TO EXPLAIN THE SOURCES OF THE CASH DEPOSITS AND IN REPLY, THE ASSESSEE SUBMITTED THAT SUCH CASH DEPOSITS WERE MADE BY THEM OUT OF THE CASH BALANCE AVAILABLE IN THEIR REGULAR CASH BOOK. THE ASSESSEE SUBMITTED THAT SUCH CASH WAS GENERATED BY THEM OUT OF ADVANCE RECEIPTS MADE BY THEM AGAINST SALES OF FLATS WHICH WERE DULY RECORDED IN ITS BOOKS OF ACCOUNT. HOWEVER, THE AO DID NOT FIND THE EXPLANATION AS SATISFACTORY AND MADE THE IMPUGNED ADDITIONS BY INVOKING THE PROVISIONS OF S. 68 OF THE ACT. THE RE LEVANT FINDINGS OF THE ASSESSING OFFICER ARE RECORDED AT PARA 7.1 AT PAGE NO. 24 TO PARA 7.4 AT PAGE NO. 25 OF THE ASSESSMENT ORDER. MATTER CARRIED TO LD. CIT(A) AND THE LD. CIT(A), A FTER CONSIDERING THE SUBMISSION OF THE ASSESSEE, GAVE THE DIRECTION TO VERIFY CASH DEPOSITS MADE BY THE ASSESSEE COMPANY BY GIVING HIS FINDINGS AT PARA 9.4. 9.4 I HAVE CONSIDERED THE A.O.S ORDER AS WELL AS THE A PPELLANTS A/R SUBMISSION. HAVING CONSIDERED BOTH, I FIND THAT THE APPELLANTS A/R HAS MAINLY PUT FORCE ON THE BOOKS OF ACCOUNTS MAINTAINE D BY THE APPELLANT. FURTHER I FIND THAT THE APPELLANT HAS CLAIMED TO HA VE MADE THE SAID DEPOSITS OUT OF WITHDRAWALS MADE FROM DIFFERENT BAN K ACCOUNTS MAINTAINED BY THE APPELLANT AND ALSO ADVANCES RECEIVED FROM VA RIOUS CUSTOMERS FOR SALE OF FLAT. HOWEVER AFTER CONSIDERING THE FACTS A VAILABLE ON RECORD, I FIND THAT THE APPELLANT FAILS TO JUSTIFY ITS CLAIM WITH RELEVANT DOCUMENTARY EVIDENCES. EVEN THE DETAILS OF CUSTOMERS FROM WHOM THE APPELLANT CLAIM OF HAVING RECEIVED THE ADVANCES IN CASH, WHICH THE APPELLANTS CLAIM THE SOURCE OF CASH DEPOSITS, HAS ALSO NOT ADDUCED. THUS , IN ABSENCE OF ANY SUCH VALID EVIDENCE, THE APPELLANTS CLAIM CANNOT B E ACCEPTED, AS THE APPELLANT HAS ONLY FILED SELF SERVING DOCUMENTS IN SUPPORT OF ITS CLAIM. HOWEVER THERE IS ALSO SUBSTANCE IN THE APPELLANTS A/R THIS CLAIM THAT ON A SPECIFIC DATE, WHEN THE CASH DEPOSITS WERE MADE, TH E APPELLANT COMPANY WAS HAVING CASH AVAILABLE IN ITS BOOKS OF ACCOUNTS OUT OF THE CASH RECEIVED FROM ITS CUSTOMER AS WELL AS OUT OF WITHDR AWAL MADE FROM THE RESPECTIVE BANK ACCOUNTS OF THE APPELLANT COMPANY. HOWEVER THE SAME PHOENIX LEISURE AND LIFESTYLE (SS)195 OF 2013 AND OTHERS 32 NEEDS VERIFICATION FROM THE APPELLANTS RECORD OF B ANK STATEMENT AS WELL AS THE APPELLANTS BOOKS OF ACCOUNTS. THOUGH I FIND TH AT THE A.O. HAS TAKEN NOTE OF THE RESPECTIVE DATE OF CASH DEPOSITS AS EXT RACTED IN PARA-7.1 OF THE ASSESSMENT ORDER BUT IN ABSENCE OF THE CASH AVAILAB ILITY ON SUCH DATES FROM APPELLANTS BOOKS OF ACCOUNTS, THE APPELLANTS A/R REQUEST CANNOT BE ACCEDED. HENCE I CONSIDER IT PROPER AND APPROPRIATE TO DIRECT THE A.O. TO VERIFY THE CLAIM OF THE APPELLANT WITH RESPECTIVE B ANKS STATEMENTS AS WELL AS FROM THE BOOKS OF ACCOUNTS IN RESPECT OF ADVANCE S RECEIVED FROM CUSTOMERS AS CLAIMED BY THE APPELLANT. IF AFTER SUC H VERIFICATION THE A.O. FINDS AVAILABILITY OF CASH IN HAND IN RESPECT OF CA SH DEPOSITS SO MADE BY THE APPELLANT COMPANY IN ITS BANK ACCOUNTS THEN ONL Y THE CASH DEPOSITS MADE BY THE APPELLANT TO THAT EXTENT, THE A.O. SHOU LD ALLOW THE CLAIM OF THE APPELLANT AS EXPLAINED. HOWEVER IF THE SAME IS NOT PROVED AS STATED ABOVE THEN THE A.O. SHOULD HELD THE SUCH CASH DEPOSIT AS UNEXPLAINED AND TO THAT EXTENT, THE ADDITION MADE BY THE A.O. WILL STA NDS CONFIRMED. WITH THIS OBSERVATION, THE APPELLANTS THESE GROUNDS OF APPEA L ARE ADJUDICATED. THUS, APPELLANTS THESE GROUNDS OF APPEAL ARE PARTL Y ALLOWED. THE LD. AR HAS MADE ORAL AS WELL AS WRITTEN SUBMISS ION AS UNDER: IN THE INSTANT CASE, ALL THE BANK ACCOUNTS IN WHIC H CASH DEPOSITS WERE FOUND MADE BY THE AO ARE GETTING INCORPORATED IN TH E REGULAR BOOKS OF ACCOUNT OF THE ASSESSEE COMPANY AND THEREFORE, THE SOURCES OF CASH DEPOSITS MADE CAN BE VERIFIED FROM THE REGULAR CASH BOOK OF THE ASSESSEE. IT IS SUBMITTED THAT SOURCES OF CASH DEPO SITS WERE EITHER FROM THE BOOKING ADVANCES RECEIVED FROM CUSTOMERS WHICH WERE RECORDED IN THE BOOKS OR FROM MAKING THE CASH WITHDRAWALS FROM THE SAME BANK ACCOUNTS. IN THESE CIRCUMSTANCES, BY ANY STRETCH OF IMAGINATION, CASH DEPOSITS MADE BY THE ASSESSEE COMPANY IN ITS BANK A CCOUNT CANNOT BE SAID TO BE UNEXPLAINED AND, CONSEQUENTLY, NO ADDIT ION ON THIS COUNT WAS WARRANTED. LD. DR HAS RELIED ON THE ORDER OF THE ASSESSING OF FICER. WE HAVE HEARD THE RIVAL CONTENTIONS OF BOTH THE PAR TIES AND HAVE PERUSED THE MATERIAL AVAILABLE ON RECORD. SINCE WE HAVE ALREADY HELD THE ASSESSMENT PROCEEDINGS AS VOID-AB-INITIO, WE DO NOT CONSIDER IT NECESSARY TO GO INTO THE MERITS OF THIS GROUND. ACCORDINGLY, THIS DEPARTMENTAL GROUND OF THE APPEAL IS DISMISSED. PHOENIX LEISURE AND LIFESTYLE (SS)195 OF 2013 AND OTHERS 33 DEPARTMENTAL GROUND NO. 3 THIS GROUND BEING GENERAL IN NATURE, HENCE NO SEPAR ATE SUBMISSION IS BEING MADE. ASSESSEES APPEAL NO. : 196/IND/2013A.Y. 2009-10 DEPARTMENTAL APPEAL NO. : 255/IND/2013A.Y. 2009-10 ASSESSEES GROUND NO. 1(A) & 1(B) THESE GROUNDS OF APPEAL ARE SIMILAR TO THAT OF GROU ND NOS. 1, 2(A) & 2(B) TAKEN BY THE ASSESSEE IN ITS APPEAL FOR A.Y. 2008-09 (APP EAL NO. IT(SS)A NO.195/IND/2013) AND THEREFORE, FOLLOWING THE DECISION TAKEN FOR AY 2008-09, WE ALLOW THE GROUNDS OF APPEAL ON THIS ISSUE. ASSESSEES GROUND NO. 2 THIS GROUND OF APPEAL IS SIMILAR TO THAT OF GROUND NO. 3 TAKEN BY THE ASSESSEE IN ITS APPEAL FOR A.Y. 2008-09 (APPEAL NO. IT(SS)-195/ IND/2013) AND THEREFORE, OUR DECISION TAKEN FOR THE A.T. 2008-09 WILL BE APPLICA BLE. FOLLOWING THE SAME, THIS GROUND OF THE APPEAL OF THE ASSESSEE IS DISMISSED. ASSESSEES GROUND NO. 3 THE ASSESSING OFFICER HAS MADE AN ADDITION OF RS.33 ,00,000/- IN THE HANDS OF THE ASSESSEE BY INVOKING THE PROVISIONS OF SECTION 69C OF THE INCOME-TAX ACT, 1961, IN THE APPELLANTS INCOME, ON ACCOUNT OF ALLEGED UNEXP LAINED EXPENDITURE INCURRED BY THE APPELLANT BY WAY OF PAYMENT TO SHRI CHIRAG SHAH. TH E RELEVANT FINDINGS OF THE A.O. ARE RECORDED AT PARA 9.1 AT PAGE NO. 32 TO PARA 9.3 AT PAGE NO. 33 OF THE ASSESSMENT ORDER. THE LD. AR HAS MADE ORAL AS WELL AS WRITTEN SUBMISS ION AS UNDER: PHOENIX LEISURE AND LIFESTYLE (SS)195 OF 2013 AND OTHERS 34 (I) THE APPELLANT COMPANY HAD NEVER MADE ANY PAYMEN T TO SHRI CHIRAG SHAH DURING THE RELEVANT PREVIOUS YEAR. (II) SINCE SHRI NILESH AJMERA, THE PERSON TO WHOM T HE SUBJECT LOOSE PAPER AND THE TRANSACTION BELONG, HAS CATEGORICALLY ADMITTED AND OWNED- UP THE TRANSACTION AS WELL AS THE SUBJECT LOOSE PAP ER, THERE WAS NO JUSTIFICATION FOR THE LEARNED AO TO MAKE THE ADDITI ON ON THIS COUNT IN THE HANDS OF THE APPELLANT COMPANY. WE HAVE HEARD THE RIVAL CONTENTIONS OF BOTH THE PAR TIES AND HAVE PERUSED THE MATERIAL AVAILABLE ON RECORD. SINCE ON LEGAL GROUND , WE HAVE ALREADY HELD THE ASSESSMENT PROCEEDINGS U/S 153C ARE VOID-AB-INITIO, WE DO NOT CONSIDER IT NECESSARY TO GO INTO THE MERITS OF THIS GROUND AND THEREFORE, TH E ADJUDICATION OF THIS GROUND SHALL REMAIN IN THE ACADEMIC NATURE ONLY. THIS GROUND OF APPEAL OF THE ASSESSEE IS ADJUDICATED ACCORDINGLY. DEPARTMENTAL GROUND NO. 1 THIS GROUND OF APPEAL IS SIMILAR TO THAT OF GROUND NO. 1 TAKEN BY THE DEPARTMENT IN ITS APPEAL FOR A.Y. 2008-09 (APPEAL NO. IT(SS)-1 95/IND/2013) AND THEREFORE, FOLLOWING THE DECISION TAKEN IN A.Y. 2008-09, WE DISMISS THIS GROUND OF APPEAL OF THE DEPARTMENT. DEPARTMENTAL GROUND NOS.2 TO 2.2 THESE GROUND OF APPEALS ARE SIMILAR TO THAT OF GROU ND NO. 2 TO 2.2 TAKEN BY THE DEPARTMENT IN ITS APPEAL FOR A.Y. 2008-09 (APPEAL N O. IT(SS)D-254/IND/2013) AND THEREFORE, FOLLOWING THE DECISION TAKEN FOR A.Y. 20 08-09, WE DISMISS THESE GROUNDS OF APPEAL OF THE DEPARTMENT. DEPARTMENTAL GROUND NOS.3 TO 3.2 PHOENIX LEISURE AND LIFESTYLE (SS)195 OF 2013 AND OTHERS 35 THE REVENUE HAS TAKEN THIS GROUND OF APPEAL AGAINST THE ACTION OF THE LD. CIT(A) IN DIRECTING THE AO TO VERIFY THE SOURCE OF CASH DE POSITS OF RS.1,84,61,000/- ADDED BY THE AO AS UNEXPLAINED CASH CREDITS U/S 68 OF THE I. T. ACT IN THE BANK ACCOUNTS OF THE ASSESSEE. THE BRIEF FACTS RELATING TO THE GROUND ARE THAT DUR ING THE COURSE OF THE ASSESSMENT PROCEEDINGS, THE AO NOTED FROM THE BANK STATEMENT OF THE ASSESSEE THAT IT HAD MADE CASH DEPOSITS AMOUNTING TO RS.1,84,61,000/ -, ON DIFFERENT DATES, IN ITS BANK ACCOUNT WITH HDFC BANK. THE AO, IN THE BODY OF THE ASSESSMENT ORDER, HAS NOTED THE DIFFERENT DATES ON WHICH THE SAID CASH DEPOSITS WER E MADE. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE AO REQUIRED THE ASSESSE E COMPANY TO EXPLAIN THE SOURCES OF THE CASH DEPOSITS AND IN REPLY, THE ASSE SSEE SUBMITTED THAT SUCH CASH DEPOSITS WERE MADE BY IT OUT OF THE CASH BALANCE AV AILABLE IN ITS REGULAR CASH BOOK. THE ASSESSEE SUBMITTED THAT SUCH CASH WAS GENERATED BY IT OUT OF ADVANCE RECEIPTS MADE BY IT AGAINST SALES OF PLOTS WHICH WERE DULY RECORD ED IN ITS BOOKS OF ACCOUNT. HOWEVER, THE AO DID NOT FIND THE EXPLANATION AS SATISFACTORY AND MADE THE IMPUGNED ADDITIONS BY INVOKING THE PROVISIONS OF S. 68 OF THE ACT. THE RE LEVANT FINDINGS OF THE ASSESSING OFFICER ARE RECORDED AT PARA 7.1 AT PAGE NO. 23 TO PARA 7.4 AT PAGE NO. 25 OF THE ASSESSMENT ORDER. THE LD. CIT(A), AFTER CONSIDERING THE SUBMISSION OF THE ASSESSEE, GAVE A DIRECTION TO VERIFY THE CASH DEPOSITS BY GIVING HIS FINDINGS AT PARA 9.3 OF HIS ORDER. 9.3 I HAVE CONSIDERED THE A.O.S ORDER AS WELL AS THE A PPELLANTS A/R SUBMISSION. HAVING CONSIDERED BOTH, I FIND THAT THE APPELLANTS A/R HAS MAINLY PUT FORCE ON THE BOOKS OF ACCOUNTS MAINTAINE D BY THE APPELLANT. FURTHER I FIND THAT THE APPELLANT HAS CLAIMED TO HA VE MADE THE SAID PHOENIX LEISURE AND LIFESTYLE (SS)195 OF 2013 AND OTHERS 36 DEPOSITS OUT OF WITHDRAWALS MADE FROM DIFFERENT BAN K ACCOUNTS MAINTAINED BY THE APPELLANT AND ALSO ADVANCES RECEIVED FROM VA RIOUS CUSTOMERS FOR SALE OF FLAT. HOWEVER AFTER CONSIDERING THE FACTS A VAILABLE ON RECORD, I FIND THAT THE APPELLANT FAILS TO JUSTIFY ITS CLAIM WITH RELEVANT DOCUMENTARY EVIDENCES. EVEN THE DETAILS OF CUSTOMERS FROM WHOM THE APPELLANT CLAIM OF HAVING RECEIVED THE ADVANCES IN CASH, WHICH THE APPELLANTS CLAIM THE SOURCE OF CASH DEPOSITS, HAS ALSO NOT ADDUCED. THUS , IN ABSENCE OF ANY SUCH VALID EVIDENCE, THE APPELLANTS CLAIM CANNOT B E ACCEPTED, AS THE APPELLANT HAS ONLY FILED SELF SERVING DOCUMENTS IN SUPPORT OF ITS CLAIM. HOWEVER THERE IS ALSO SUBSTANCE IN THE APPELLANTS A/R THIS CLAIM THAT ON A SPECIFIC DATE, WHEN THE CASH DEPOSITS WERE MADE, TH E APPELLANT COMPANY WAS HAVING CASH AVAILABLE IN ITS BOOKS OF ACCOUNTS OUT OF THE CASH RECEIVED FROM ITS CUSTOMER AS WELL AS OUT OF WITHDR AWAL MADE FROM THE RESPECTIVE BANK ACCOUNTS OF THE APPELLANT COMPANY. HOWEVER THE SAME NEEDS VERIFICATION FROM THE APPELLANTS RECORD OF B ANK STATEMENT AS WELL S THE APPELLANTS BOOKS OF ACCOUNTS. THOUGH I FIND TH AT THE A.O. HAS TAKEN NOTEOF THE RESPECTIVE DATE OF CASH DEPOSITS AS EXTR ACTED IN PARA-7.1 OF THE ASSESSMENT ORDER BUT IN ABSENCE OF THE CASH AVAILAB ILITY ON SUCH DATES FROM APPELLANTS BOOKS OF ACCOUNTS, THE APPELLANTS A/R REQUEST CANNOT BE ACCEDED. HENCE I CONSIDER IT PROPER AND APPROPRIATE TO DIRECT THE A.O. TO VERIFY THE CLAIM OF THE APPELLANT WITH RESPECTIVE B ANKS STATEMENTS AS WELL AS FROM THE BOOKS OF ACCOUNTS IN RESPECT OF ADVANCE S RECEIVED FROM CUSTOMERS AS CLAIMED BY THE APPELLANT. IF AFTER SUC H VERIFICATION THE A.O. FINDS AVAILABILITY OF CASH IN HAND IN RESPECT OF CA SH DEPOSITS SO MADE BY THE APPELLANT COMPANY IN ITS BANK ACCOUNTS THEN ONL Y THE CASH DEPOSITS MADE BY THE APPELLANT TO THAT EXTENT, THE A.O. SHOU LD ALLOW THE CLAIM OF THE APPELLANT AS EXPLAINED. HOWEVER IF THE SAME IS NOT PROVED AS STATED ABOVE THEN THE A.O. SHOULD HELD THE SUCH CASH DEPOSIT AS UNEXPLAINED AND TO THAT EXTENT, THE ADDITION MADE BY THE A.O. WILL STA NDS CONFIRMED. WITH THIS OBSERVATION, THE APPELLANTS THESE GROUNDS OF APPEA L ARE ADJUDICATED. THUS, APPELLANTS THESE GROUNDS OF APPEAL ARE PARTL Y ALLOWED. THE LD. AR HAS MADE ORAL AS WELL AS WRITTEN SUBMISS ION AS UNDER: ALL THE BANK ACCOUNTS IN WHICH CASH DEPOSITS WERE FOUND MADE BY THE AO ARE GETTING INCORPORATED IN THE REGULAR BOOKS OF AC COUNT OF THE ASSESSEE COMPANY AND THEREFORE, THE SOURCES OF CASH DEPOSITS MADE CAN BE PHOENIX LEISURE AND LIFESTYLE (SS)195 OF 2013 AND OTHERS 37 VERIFIED FROM THE REGULAR CASH BOOK OF THE ASSESSEE . IT IS SUBMITTED THAT SOURCES OF CASH DEPOSITS WERE EITHER FROM THE BOOKI NG ADVANCES RECEIVED FROM CUSTOMERS WHICH WERE RECORDED IN THE BOOKS OR FROM MAKING THE CASH WITHDRAWALS FROM THE SAME BANK ACCOUNTS. IN SU CH CIRCUMSTANCES, CASH DEPOSITS SO MADE BY THE ASSESSEE COMPANY IN IT S BANK ACCOUNTS CANNOT BE HELD TO BE UNEXPLAINED. LD. DR HAS RELIED ON THE ORDER OF THE ASSESSING OF FICER. WE HAVE HEARD THE RIVAL CONTENTIONS OF BOTH THE PAR TIES AND HAVE PERUSED THE MATERIAL AVAILABLE ON RECORD. SINCE WE HAVE ALREADY HELD THE ASSESSMENT PROCEEDINGS AS VOID-AB-INITIO, WE DO NOT CONSIDER IT NECESSARY TO GO INTO THE MERITS OF THIS GROUND. ACCORDINGLY, THIS DEPARTMENTAL GROUND OF THE APPEAL IS DISMISSED. DEPARTMENTAL GROUND NOS.4 & 4.1 THESE GROUNDS OF APPEALS HAVE BEEN RAISED BY THE DE PARTMENT AGAINST THE RELIEF GRANTED TO THE ASSESSEE BY THE LEARNED CIT(A) IN RE SPECT OF ADDITION MADE BY AO TOWARDS DEVGURADIA LAND PURCHASE. IT WAS SUBMITTED BY BOTH THE PARTIES THAT THESE GROUND ARE COVERED BY THE ASSESSEES GROUNDS OF APP EAL BEARING NO. 4 IN ITS APPEAL FOR A.Y. 2008-09 (APPEAL NO. IT(SS)A-195/IND/2013). THE REFORE, FOLLOWING THE DECISION TAKEN FOR A.Y. 2008-09, WE DISMISS THIS GROUND OF T HE APPEAL OF THE DEPARTMENT. DEPARTMENTAL GROUND NOS. 5 & 6 THESE GROUNDS BEING GENERAL IN NATURE, HENCE NO SE PARATE ADJUDICATION IS REQUIRED. PHOENIX LEISURE AND LIFESTYLE (SS)195 OF 2013 AND OTHERS 38 DEPARTMENTAL APPEAL NO. : 565/IND/2013A.Y. 2010-11 DEPARTMENTAL GROUND NO. 1 THIS GROUND OF APPEAL IS SIMILAR TO THAT OF GROUND NO. 1TAKEN BY THE DEPARTMENT IN ITS APPEAL FOR A.Y. 2008-09 (APPEAL NO. IT(SS)D- 254/IND/2013) AND THEREFORE, FOLLOWING THE DECISION FOR A.Y. 2008-09, WE DISMISS GROUND NO.1 OF THE APPEAL FO THE DEPARTMENT. DEPARTMENTAL GROUND NOS.2 TO 2.2 THE REVENUE HAS TAKEN THIS GROUND OF APPEAL AGAINS T THE ACTION OF THE LD. CIT(A) IN DIRECTING THE AO TO VERIFY THE SOURCE OF CASH DE POSITS OF RS.37,48,700/- ADDED BY THE AO AS UNEXPLAINED CASH CREDITS U/S 68 OF THE I.T. A CT IN THE BANK ACCOUNTS OF THE ASSESSEE. THE BRIEF FACTS RELATING TO THE GROUND ARE THAT DU RING THE COURSE OF THE ASSESSMENT PROCEEDINGS, THE AO NOTED FROM THE BANK STATEMENT OF THE ASSESSEE THAT IT HAD MADE CASH DEPOSITS AMOUNTING TO RS.37,48,700/-, ON DIFFERENT DATES, IN ITS BANK ACCOUNT WITH HDFC BANK. THE AO, IN THE BODY OF THE ASSESSMENT ORDER, HAS NOTED THE DIFFERENT DATES ON WHICH THE SAID CASH DEPOSITS WER E MADE. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE AO REQUIRED THE ASSESSE E COMPANY TO EXPLAIN THE SOURCES OF THE CASH DEPOSITS AND IN REPLY, THE ASSE SSEE SUBMITTED THAT SUCH CASH DEPOSITS WERE MADE BY IT OUT OF THE CASH BALANCE AV AILABLE IN ITS REGULAR CASH BOOK. THE ASSESSEE SUBMITTED THAT SUCH CASH WAS GENERATED BY IT OUT OF ADVANCE RECEIPTS MADE BY IT AGAINST SALES OF PLOTS WHICH WERE DULY RECORD ED IN ITS BOOKS OF ACCOUNT. HOWEVER, THE AO DID NOT FIND THE EXPLANATION AS SATISFACTORY AND MADE THE IMPUGNED ADDITIONS BY PHOENIX LEISURE AND LIFESTYLE (SS)195 OF 2013 AND OTHERS 39 INVOKING THE PROVISIONS OF S. 68 OF THE ACT. THE R ELEVANT FINDINGS OF THE ASSESSING OFFICER ARE RECORDED AT PARA 4.1 AT PAGE NO. 4 OF T HE ASSESSMENT ORDER. THE LD. CIT(A), AFTER CONSIDERING THE SUBMISSION O F THE ASSESSEE, GAVE A DIRECTION TO VERIFY THE CASH DEPOSITS BY GIVING HIS FINDINGS AT PARA 7.3 OF HIS ORDER. 7.3 I HAVE CONSIDERED THE A.O.S ORDER AS WELL AS THE A PPELLANTS A/R SUBMISSION. HAVING CONSIDERED BOTH, I FIND THAT THE APPELLANTS A/R HAS MAINLY PUT FORCE ON THE BOOKS OF ACCOUNT MAINTAINED BY THE APPELLANT. FURTHER I FIND THAT THE APPELLANT HAS CLAIMED TO HA VE MADE THE SAID DEPOSITS OUT OF WITHDRAWALS MADE FROM DIFFERENT BAN K ACCOUNTS MAINTAINED BY THE APPELLANT AND ALSO ADVANCES RECEIVED FROM VA RIOUS CUSTOMERS FOR SALE OF FLAT. HOWEVER AFTER CONSIDERING THE FACTS A VAILABLE ON RECORD, I FIND THAT THE APPELLANT FAILS TO JUSTIFY ITS CLAIM WITH RELEVANT DOCUMENTARY EVIDENCES. EVEN THE DETAILS OF CUSTOMERS FROM WHOM THE APPELLANT CLAIM OF HAVING RECEIVED THE ADVANCE IN CASH, WHICH THE A PPELLANTS CLAIM THE SOURCE OF CASH DEPOSITS, HAS ALSO NOT ADDUCED. THUS , IN ABSENCE OF ANY SUCH VALID EVIDENCE, THE APPELLANTS CLAIM CANNOT B E ACCEPTED, AS THE APPELLANT HAS ONLY FILED SELF SERVING DOCUMENTS IN SUPPORT OF ITS CLAIM. HOWEVER THERE IS ALSO SUBSTANCE IN THE APPELLANTS A/R THIS CLAIM THAT ON A SPECIFIC DATE, WHEN THE CASH DEPOSITS WERE MADE, TH E APPELLANT COMPANY WAS HAVING CASH AVAILABLE IN ITS BOOKS OF ACCOUNTS OUT OF THE CASH RECEIVED FROM ITS CUSTOMER AS WELL AS OUT OF WITHDR AWALS MADE FROM THE RESPECTIVE BANK ACCOUNTS OF THE APPELLANT COMPANY. HOWEVER THE SAME NEEDS VERIFICATION FROM THE APPELLANTS RECORD OF B ANK STATEMENT AS WELL AS THE APPELLANTS BOOKS OF ACCOUNTS. THOUGH I FIND TH AT THE A.O. HAS TAKEN NOTE OF THE RESPECTIVE DATE OF CASH DEPOSITS AS EXT RACTED IN PARA 4.2 OF THE ASSESSMENT ORDER BUT IN ABSENCE OF THE CASH AVAILAB ILITY ON SUCH DATES FROM APPELLANTS BOOKS OF ACCOUNTS, THE APPELLANTS A/R REQUEST CANNOT BE ACCEDED. HENCE I CONSIDER IT PROPER AND APPROPRIATE TO DIRECT THE A.O. TO VERIFY THE CLAIM OF THE APPELLANT WITH RESPECTIVE B ANKS STATEMENTS AS WELL PHOENIX LEISURE AND LIFESTYLE (SS)195 OF 2013 AND OTHERS 40 AS FROM THE BOOKS OF ACCOUNTS IN RESPECT OF ADVANCE S RECEIVED FROM CUSTOMERS AS CLAIMED BY THE APPELLANT. IF AFTER SUC H VERIFICATION THE A.O. FINDS AVAILABILITY OF CASH IN HAND IN RESPECT OF CA SH DEPOSITS SO MADE BY THE APPELLANT COMPANY IN ITS BANK ACCOUNTS THEN ONL Y THE CASH DEPOSITS MADE BY THE APPELLANT TO THAT EXTENT, THE A.O. SHOU LD ALLOW THE CLAIM OF THE APPELLANT AS EXPLAINED. HOWEVER IF THE SAME IS NOT PROVED AS STATED ABOVE THEN THE A.O. SHOULD HELD THE SUCH CASH DEPOSIT AS EXPLAINED AND TO THAT EXTENT, THE ADDITION MADE BY THE A.O. WILL STANDS C ONFIRMED. WITH THIS OBSERVATION, THE APPELLANTS THESE GROUNDS OF APPEA L ARE ADJUDICATED. THUS, APPELLANTS THESE GROUNDS OF APPEAL ARE PARTL Y ALLOWED. THE LD. AR HAS MADE ORAL AS WELL AS WRITTEN SUBMIS SION AS UNDER: ALL THE BANK ACCOUNTS IN WHICH CASH DEPOSITS WERE FOUND MADE BY THE AO ARE GETTING INCORPORATED IN THE REGULAR BOOKS OF AC COUNT OF THE ASSESSEE COMPANY AND THEREFORE, THE SOURCES OF CASH DEPOSITS MADE CAN BE VERIFIED FROM THE REGULAR CASH BOOK OF THE ASSESSEE . IT IS SUBMITTED THAT SOURCES OF CASH DEPOSITS WERE EITHER FROM THE BOOKI NG ADVANCES RECEIVED FROM CUSTOMERS WHICH WERE RECORDED IN THE BOOKS OR FROM MAKING THE CASH WITHDRAWALS FROM THE SAME BANK ACCOUNTS. IN SU CH CIRCUMSTANCES, CASH DEPOSITS SO MADE BY THE ASSESSEE COMPANY IN IT S BANK ACCOUNTS CANNOT BE HELD TO BE UNEXPLAINED. LD. DR RELIED ON THE ORDER OF THE ASSESSING OFFICER . WE HAVE HEARD RIVAL CONTENTIONS AND PERUSED THE MAT ERIAL AVAILABLE ON RECORD. WE FIND THAT THE LD. CIT(A) HAS GIVEN DIRECTION AS ABOVE. THOUGH THE LD. CIT(A) HAS NO POWERS TO GIVE THE DIRECTION BUT THE TRIBUNAL HAS A LL THE POWERS TO GIVE THE DIRECTION, PHOENIX LEISURE AND LIFESTYLE (SS)195 OF 2013 AND OTHERS 41 THEREFORE, WE GIVE THE DIRECTION TO THE ASSESSING O FFICER TO VERIFY THE CLAIM OF THE ASSESSEE WITH RESPECTIVE BANKS STATEMENTS AS WELL A S FROM THE BOOKS OF ACCOUNTS IN RESPECT OF ADVANCES RECEIVED FROM CUSTOMERS AS CLAI MED BY THE ASSESSEE. IF AFTER SUCH VERIFICATION THE A.O. FINDS AVAILABILITY OF CASH IN HAND AS PER THE REGULAR CASH BOOK IN RESPECT OF CASH DEPOSITS SO MADE BY THE ASSESSEE IN ITS BANK ACCOUNTS THEN ONLY THE CASH DEPOSITS MADE BY THE ASSESSEE TO THAT EXTENT, THE A.O. SHOULD ALLOW THE CLAIM OF THE ASSESSEE AS EXPLAINED. HOWEVER IF THE SAME IS N OT PROVED AS STATED ABOVE THEN THE A.O. SHOULD HELD THE SUCH CASH DEPOSIT AS EXPLAINED AND TO THAT EXTENT, THE ADDITION MADE BY THE A.O. WILL STANDS CONFIRMED. THUS, WE DO NOT FIND ANY MERIT IN THE GROUND OF THE DEPARTMENT. IN THE RESULT, THE DEPARTMENTAL APP EAL ON THIS ISSUE IS DISMISSED. FINALLY, APPEALS OF THE ASSESSEE ARE PARTLY ALLOWED IN TERMS AS INDICATED WHEREAS APPEALS OF THE DEPARTMENT ARE DISMISSED. ORDER WAS PRONOUNCED IN THE OPEN COURT ON 18.5.2016 . SD/- SD/- (B.C. MEENA) (D.T. GARASIA) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 18.5.2016 COPY TO: APPELLANT/RESPONDENT/CIT(A)/CIT/DR, INDORE