Shri Rajeshbhai Harsukhlal Sodha, RAJKOT-GUJARAT V. The Dy.Commr. of Income Tax, Cir.-1(2), RAJKOT-GUJARAT

ITSSA 2/RJT/2016

• Counselvise Citation: [2024] 100 COUNSELVISE.COM (IT) 3734 (ITAT-RAJKOT)
• Duration Of Justice: 7 year(s) 7 month(s) 10 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 20-02-2024
• Appeal Filed By: Assessee
• Order Result: PartlyAllowed
• Bench Allotted: DB
• Next Hearing Date: 07-01-2024
• Assessment Year: misc
• Appeal Filed On: 10-07-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Rectification of order; Corroborative evidences; TDS; Set aside
• Section: 132; 143(3); 133A; 119(2)(b); 158BC(c); 158BC; 73

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, RAJKOT BENCH, RAJKOT BEFORE MS. SUCHITRA KAMBLE, JUDICIAL MEMBER AND SHRI WASEEM AHMED, ACCOUNTANT MEMBER (Conducted through Virtual Court) IT(SS)A No. 02/RJT/2016 Block Period 01/04/1988 to 21/04/1998 relevant to AYs 1989-90 to 1999-2000 Shri Rajesh Harsukhlal Sodha “Krishna Kutir” 7-Gayakwadi Plot, Rajkot Vs The Dy.CIT Circle1(2) Rajkot PAN: AFYPS 7116 Q / (Appellant) / (Respondent) Assessee by : Shri Mehul Ranpura, Ld.AR Revenue by : Shri Ritesh Parmar, CIT(DR) स ु नवाई क तार ख/Date of Hearing : 08/01/2024 घोषणा क तार ख /Date of Pronouncement: 21/02/2024 आदेश/O R D E R PER MS. SUCHITRA KAMBLE, JUDICIAL MEMBER This appeal is filed by the Assessee against the order dated 18/04/2016 passed by the Commissioner of Income-tax (Appeals)-1, Rajkot [“CIT(A)” in short] for Block Period 01/04/1988 to 21/04/1998 relevant to AYs 1989-90 to 1999-2000. 2. Grounds of appeal are as under: 1.0 The grounds of appeal mentioned hereunder are without prejudice to one another. 2.0 The learned Commissioner of Income-tax (Appeals)-1, Rajkot (hereinafter referred to as the CIT(A) ] erred on facts as also in law in retaining addition of Rs. 67,839/- out of total addition of Rs.75,000/- made by the AO. The addition retained is totally unjustified and the same may kindly be deleted. 3.0 The Id. CIT(A) erred on facts as also in law in retaining addition of Rs. 1,81,780/- out of addition of Rs.13,70,317 /- made by the AO on IT(ss)A No.02/Rjt/2016 Shri Rajeshbhai Harsukhlal Sodha vs. DCIT Block Period 01/04/1988 to 21/04/1998 Relating to AYs 1989-90 to 1999-2000 2 account of alleged unexplained professional receipt on the alleged ground that the appellant failed to prove that these income was not belonging to him. The addition retained is totally unjustified on facts as also in law and may kindly be directed to be deleted. 4.0 he Id. CIT(A) erred on facts as also in law in retaining addition of Rs.2,74,000/- out of total addition made on account of alleged undisclosed investment. The AO may kindly be directed to reduce the amount to the above extent. 5.0 The Id. CIT(A) erred on facts as also in law in not giving credit of Rs. 7,54,278/-being totaling error/duplication/refunds belonged to clients out of addition made on account of alleged income-tax refund obtained through unlawful means. The AO may kindly be directed to reduce the amount to the above extent. 6.0 The Id. CIT(A) erred on fact as also in law in retaining addition of Rs. 1,70,000/- made on account of loan obtained from GSFC by fabrication of false record. The addition retained is totally unjustified on fact as also in law and may kindly be directed to be deleted.” 3. A search u/s 132 of the Income Tax Act, 1961 and survey u/s 133A of the Act was carried out at the residential and business premises of the assessee on 22.04.1998. Subsequently, assessment proceedings u/s 158BC were initiated. The assessee filed his return of Income u/s 158BC of the Act for block period on 23.02.2000 declaring the undisclosed income at Rs. Nil. The DCIT, Investigation, Rajkot vide order u/s 158BC(c) r.w.s. 143(3) dated 27.04.2000, originally finalized the block assessment proceedings, assessing the undisclosed income at Rs. 1,22,67,400/- after making various additions. Being aggrieved, an appeal was preferred before the CIT(A), which was dismissed vide order dated 17.02.2003. The Tribunal vide order dated 20.10.2005 restored the entire matter back to the file of the Assessing Officer to decide it afresh. The Assessing Officer vide order u/s 158BC(c) r.w.s. 143(3) & 254 of the Act dated 29.12.2006 assessed the undisclosed income at Rs. 1,22,67,400/-. The Assessing Officer observed that the assessee entered into share transactions on behalf of others on the basis of register marked as Annexure A-12 of Panchnama dated 21.04.1998 amounting to Rs. 1,22,12,680/- and IT(ss)A No.02/Rjt/2016 Shri Rajeshbhai Harsukhlal Sodha vs. DCIT Block Period 01/04/1988 to 21/04/1998 Relating to AYs 1989-90 to 1999-2000 3 thereby estimated the profit on such transactions @ 10% at Rs. 12,21,268/-. The Assessing Officer further estimated the gross receipts from bus plying at Rs. 5,00,000/- and profit @ 15% of such estimated receipts, thus making addition of Rs. 75,000/-. The Assessing Officer further added Rs. 13,70,317/- on account of undisclosed income from profession as Chartered Accountant and Income Tax Practitioner. The Assessing Officer added Rs. 32,20,006 on account of undisclosed investment made in shares, debentures, deposits with banks and companies, acquisition of car, bus, jewellery, residential and office flats, advances, expenses in contemplation of divorce etc. The Assessing Officer further made addition of Rs. 27,27,823/- on account of Income Tax Refunds and held that the same was obtained through forgery, cheating and unlawful means on the basis of Annexure A-24 of Panchnama dated 21.04.1998. The Assessing Officer further added Rs. 31,82,884/- on account of Income Tax Refunds, cash deposits for opening of bank accounts in order to deposit the refund vouchers and other forged TDS certificates found and other documents on the basis of Annexure A-28 to A-38 of the Panchnama dated 21.04.1998. The Assessing Officer also made addition of Rs. 1,70,000/-, thereby observing that the assessee obtained the said loan from GSFC through fabrication of false record and did not repay the same on the basis of Annexure A-12 of Panchnama dated 21.04.1998. 4. Being aggrieved by the assessment order, the assessee filed appeal before the CIT(A). The CIT(A) partly allowed the appeal. 5. As regards to Ground No. 1 relating to retaining addition of Rs. 67,839/- out of total addition of Rs. 75,000/- made by the Assessing Officer, the Ld. AR submitted that the Assessing Officer during the remand proceedings did not consider copies of supporting evidence of IT(ss)A No.02/Rjt/2016 Shri Rajeshbhai Harsukhlal Sodha vs. DCIT Block Period 01/04/1988 to 21/04/1998 Relating to AYs 1989-90 to 1999-2000 4 other expenses furnished with the submissions especially the summary of expenses for Rs. 74,848/- alongwith its supporting evidence. Therefore, the Ld. AR submitted that against income of Rs. 67,839/- as accepted by the Assessing Officer and the CIT(A), expenses of Rs. 74,848/- are requested to be allowed. This will leave with a small loss of Rs. 7,009/- from bus plying business. Thus, the Ld. AR submitted that the retained addition of Rs. 67,839/- be deleted. 6. The Ld. DR submitted that during the remand proceedings, the assessee produced P&L account for the period 30.11.1997 to 31.03.1998 for the transportation business. According to this account, income was shown at Rs. 67,839/- and expenses of Rs. 91,402/- were shown resulting into loss of Rs. 23,563/-. The assessee was asked to produce the documentary evidences of expenses of Rs. 91,042/-. However, he could produce only receipt of RTO tax of Rs. 30,240/- however no details in respect of expenses of Rs. 61,162/- were produced. The Ld. DR submitted that considering the commercial scenario, it is abnormal that any person would incur expense of Rs. 61,162 for earning income of Rs. 67,839/-. The Ld. DR further submitted that the CIT(A) while dealing with the remand report observed that the Assessing Officer is now taking pragmatic stand as there is gross receipt of Rs. 67,839/- against which the assessee claimed expenditure of Rs. 91,042/-. There is no basis of claim of expenditure. Thus, the onus was upon the assessee to furnish the details of the expenses so claimed, which the assessee failed to do so and therefore, the claim of expenses was not allowable. Secondly, from the copy of registration book, it can be seen that the vehicle was in the name of the assessee for four months only. Hence, in the absence of any evidence, there is no basis for estimating the gross receipt at Rs. 5.00 lac. Therefore, taking the facts and circumstance of the case in totality, the IT(ss)A No.02/Rjt/2016 Shri Rajeshbhai Harsukhlal Sodha vs. DCIT Block Period 01/04/1988 to 21/04/1998 Relating to AYs 1989-90 to 1999-2000 5 income from bus plying activities was taken at Rs. 67,839/- and thus, the assessee got relief of the remaining amount. 7. We have heard both the parties and perused the relevant material on record. It is pertinent to note that the contention of the Ld.AR that the Assessing Officer during the remand proceedings did not consider copies of supporting evidence of other expenses of Rs.74,848/- along with its supporting evidences. The remand report clearly reveals that the assessee was asked to produce documentary evidences of expenses of Rs.91,042/- however, he could produe only receipt of RTO tax of Rs.30,240/-. However, no details of expenses of Rs.61,162/- was produced. The CIT(A) has categorically held that in the commercial scenario it is abnormal that any person incurred of Rs.61,162/- for earning the income of Rs.67,839/-. From the copy of registration book, the vehicle was in the name of the assessee for four months only and as there was no evidence whatsoever produced by the assessee. The CIT(A) has rightly confirmed the addition of Rs.67,839/- out of total addition of Rs.75,000/-. There is no need to interfere with the findings of the CIT(A). Hence, ground No.1 is dismissed. 8. Ground No.2 is in two parts of separate issues. As regards to Ground No. 2(first part) relating to retaining addition of Rs. 1,81,780/- out of total addition of Rs.13,70,317/- made by the Assessing Officer on account of unexplained professional receipt, the Ld. AR submitted that there are two items in these receipts of Rs. 24,000/- and 1,57,780/-. The Ld. AR submitted that as regards Rs. 24,000/-, the assessee received the said amount as total accounting fees on various dates from various clients during the F.Y. 1996-97. These fees were received on behalf of accountant, and it was credited to ledger named as ACCOUNTING FEES. The ledger is reproduced hereunder: IT(ss)A No.02/Rjt/2016 Shri Rajeshbhai Harsukhlal Sodha vs. DCIT Block Period 01/04/1988 to 21/04/1998 Relating to AYs 1989-90 to 1999-2000 6 Date Debit Rs. Credit Rs. 03/10/2016 Accounting fees received from Sarang Con.Co. 6,000 03/10/2016 Paid to Accountant 6,000 01/11/2016 Accounting fees received from Dhirubhai Shah 6,000 26/11/2016 Paid to Accountant 6,000 02/01/2017 Accounting fees received from Alpa Con.Co. 12,000 02/01/2017 Paid to Accountant 12,000 TOTAL 24,000 24,000 The Ld. AR submitted that the assessee himself was not providing any accounting services, but on request of client, the assessee used to hire accountant to carry out accounting work for clients. As clients were not in direct contact with the accountant, they used to pay fees to the assessee and in turn assessee used to pass on these fees to accountant. From the ledger, it was clear that Accounting fees were received from 3 different clients and the same were passed onto the accountant, there is no income for the assessee, as the assessee acted just as a intermediary and to help the clients to get the accounting work done. 9. The Ld. DR submitted that the assessee received accounting fees of Rs. 24,000/- as per the ledger of accounting fees produced by the assessee. The assessee was asked to show this income in the return of income. However, the assessee claimed that this fees was collected from the clients on behalf of the accountant and was passed onto the accounts for the accounting work done by them. The Ld. DR submitted that this plea of the assessee was not accepted as no evidence in this regard was produced. IT(ss)A No.02/Rjt/2016 Shri Rajeshbhai Harsukhlal Sodha vs. DCIT Block Period 01/04/1988 to 21/04/1998 Relating to AYs 1989-90 to 1999-2000 7 10. We have heard both the parties and perused all the relevant material available on record. It is pertinent to note that the assessee himself was not providing any accounting services, but on request of client, the assessee used to hire Accountant to carry out accounting work for clients. But the assessee at no point of time has given any evidence to that effect that the said amount was collected from the client on behalf of the Accountant. Though the ledger shows that accounting fees was received from three different clients, the same does not show that the said fee was passed on to the Accountant. Therefore, the CIT(A) has rightly confirmed the addition to the extent of Rs.1,81,780/- out of total addition of Rs.13,70,317/-. Ground No.2(first part) is dismissed. 11. As regards to ground No.2(second part) relating to addition of Rs. 1,57,780/-, the Ld. AR submitted that annexure A/15 is a cheque and cash inward register. Any receipt by cheque or cash is entered on this register, be it a fee or loan or other receipt. The Ld. AR pointed that Rs. 15,57,780/- was received from Riddhi Siddhi Investments on 03.12.1997 for Bhavini Sodha in respect of sale of her shares. Hence, it is not income of the assessee. Bill No. 158 dated 03.12.1997 in respect of sale of shares through Riddhi Siddhi Investments is attached to paper book (pg. 27) clearly suggests that this transaction belongs to Bhavini Sodha. Bhavini Sodha is a regular assessee and filing her income tax returns on regular basis. The Ld. AR pointed out the entries wherein the amount of fees ranges from Rs. 150 to Rs. 15,000. Hence, the huge amount of Rs. 1,57,780/- cannot be fees and hence cannot be treated as income. The Ld. AR further pointed out the amount of Rs. 35,065/- which represents total fees received upto 16.12.1997 from various clients being Rs. 12,166, Rs. 15,000, Rs. 2,000, Rs. 150, Rs. 2,500, Rs. 750, Rs. 500 and Rs. 2,000. The amounts of Rs. 25,000 and Rs. 1,57,780 are not summed up to arrive at Rs. 35,065 as shown in the said row no. 11. These two amounts are IT(ss)A No.02/Rjt/2016 Shri Rajeshbhai Harsukhlal Sodha vs. DCIT Block Period 01/04/1988 to 21/04/1998 Relating to AYs 1989-90 to 1999-2000 8 circled to show that these are not fees income. Hence, the amount of Rs. 1,57,780/- is not fees income. Without prejudice to the above, the Ld. AR submitted that if revenue wants to consider the amount of Rs. 1,57,780/- in the hands of assessee, the purchase costs associated with this sale of said shares should also be allowed as deduction. The purchase costs of such shares is Rs. 1,56,121/-. This will leave a short term gain of Rs. 1,659/-. Payment of Rs. 1,56,121/- was made on 28.11.1997 and Rs. 1,57,780/- was received on 05.12.1997. Purchase Bill No. 138 dated 26.11.1997 from Riddhi Siddhi Investments, bank statement reflecting a payment of Rs. 1,56,121 and bank statement reflecting a receipt of Rs. 1,57,780/- were submitted. Thus, the Ld. AR submitted that retaining additions of Rs. 24,000 and Rs. 1,57,780 is not justifiable. 12. The Ld. DR submitted that Annexure A/15 contains a transaction of Rs 1,57,780/- in the name of Smt. Bhavini Sodha, wife of the assessee. The assessee claimed that it does not pertain to him. This plea of the assessee is not acceptable as the cheque was very much deposited in the bank account of the assessee and his wife was also having separate bank account. Therefore there was no reason for depositing her cheque in the account of the assessee. Therefore, the amount of Rs. 1,57,780 was rightly upheld by the CIT(A). 13. We have heard both the parties and perused all the relevant material available on record. It is pertinent to note that the assessee received Rs.15,57,780/- from Riddhi Siddhi Investments on 03/12/1997 from Bhavani Sodha, wife of the assessee in respect of sale of her shares. The assessee has shown this Bill No.158 dated 03/12/1997 in respect of sale of shares through Riddhi Siddhi Investments and set out that this transaction belongs to Bhavini Sodha. The entries wherein amount of fees ranges from Rs.150 to 15,000/- has also been pointed out by the assessee IT(ss)A No.02/Rjt/2016 Shri Rajeshbhai Harsukhlal Sodha vs. DCIT Block Period 01/04/1988 to 21/04/1998 Relating to AYs 1989-90 to 1999-2000 9 and the assessee has given the details of the sale. These details were not considered by the CIT(A) and, therefore, the addition of Rs.1,57,780/- was not rightly confirmed by the CIT(A). Hence, ground No.2( second part) is allowed. 13.1. Thus, Ground No.2 is partly allowed. 14. As regards to Ground No. 3 relating to retaining addition of Rs. 2,74,000 out of total addition made on account of undisclosed investment, the Ld. AR submitted that the Assessing Officer as well as the CIT(A) ignored the affidavits of family members and relatives of the assessee specifically stating that the debentures, Indira Vikas Patra, Shares etc. are owned by them. 15. The Ld. DR submitted that in remand report the Assessing Officer mentioned that the assessee has not furnished documentary evidence showing that the ownership of debentures, Indira Vikas Patra, Shares etc. are of other persons/family members of the assessee and on the basis of such reporting in remand report, the CIT(A) has sustained the addition of Rs. 2,74,000/-. 16. We have heard both the parties and perused all the relevant material available on record. It is pertinent to note that the assessee has filed the Affidavit of family members and relatives of the assessee specifically listed that the debentures, Indira Vikas Patra, shares, etc. were owned by them. This Affidavit was totally ignored by the CIT(A) and, therefore, the addition of Rs.2,74,000/- out of total addition made on account of undisclosed investment was not justified on part of the Assessing Officer as well CIT(A). Hence, ground No.3 is allowed. IT(ss)A No.02/Rjt/2016 Shri Rajeshbhai Harsukhlal Sodha vs. DCIT Block Period 01/04/1988 to 21/04/1998 Relating to AYs 1989-90 to 1999-2000 10 17. As regards to Ground No. 4 relating to retaining addition of Rs. 7,54,278/- being totalling error / duplications and refunds belonging to regular clients, the Ld. AR submitted that Annexure A/24 is Income Tax Return filing register maintained by the assessee in which it used to list all income tax returns, filed by the assessee’s firm. The assessee furnished a detailed chart showing particulars of each item as per Annexure A/24. There are refunds related to regular clients of the assessee to the tune of Rs. 6,04,634/-. There are also wrong amounts and duplications of Rs. 1,49,644/-. The assessee has also submitted supporting documents to prove identity and genuineness of clients by providing copy of their own bank passbooks / statements showing their names as account holders, Partnership deeds duly signed by partners, copy of registration with registrar of firm, agreements with third parties, copy of their income tax return duly filled in with their own handwriting, copy of self-assessment tax payment, Income Tax Clearance Certificate, Order u/s 119(2)(b) and copy of Form No. 49A. The Ld. AR further submitted that wherever wrong refunds were issued by the department u/s 143(1)(a), the department has raised demand by passing rectification orders u/s 154. After verification of their own records, the department was satisfied that other refunds were granted to genuine clients and accordingly no further rectification order u/s 154 were passed by the department. If department would have found that refunds granted to the tune of Rs. 6,04,634/- are also wrongly granted, the department would have rectified u/s 154 and raised demand accordingly. This proves that other refunds to the tune of Rs. 6,04,634/- were genuine. Therefore, the Ld. AR submitted that the addition of Rs. 7,54,278/- require to be deleted. 18. The Ld. DR submitted that the assessee has not conclusively proved that there is duplication of Rs. 1,49,644/-. The claim of the assessee that refunds of Rs. 6,04,634/- belonged to his client is not acceptable, as the IT(ss)A No.02/Rjt/2016 Shri Rajeshbhai Harsukhlal Sodha vs. DCIT Block Period 01/04/1988 to 21/04/1998 Relating to AYs 1989-90 to 1999-2000 11 assessee has filed copy of acknowledgment of his so called clients in support of his claim that refunds of Rs. 6,04,634/- belonged to his clients. However, he has not filed any confirmation from the clients proving their identity and genuineness and also not provided any of the so called clients for verification and examination of Assessing Officer during the remand proceedings. Therefore, the claim of the assessee was rightly rejected. Thus, the CIT(A) rightly upheld the finding of the Assessing Officer and retained addition of Rs. 7,54,278/- being totalling error, duplications and refunds to genuine clients. 19. We have heard both the parties and perused all the relevant material available on record. It is pertinent to note that the ‘Annexure- A/24’ is Income Tax Return filing register maintained by the assessee in which it used to list all Income Tax Returns filed by assessee. The assessee furnished a detailed chart showing particulars of each item as per ‘Annexure-A/24’, there are refunds related to regular clients of the assessee to the tune of Rs.6,04,634/-. There are wrong amounts and duplication of Rs.1,49,644/-. As per the contentions of the Ld.DR, the assessee submitted supporting documents to prove identity and genuineness of clients by providing copy of their own bank pass-books/ statements showing their names as account holders; partnership-deeds duly signed by partners, copy of registration with Registrar of firm, agreements with third parties, copy of their income-tax return duly filled in with their own hand-writing, copy of self-assessment tax payment, income-tax clearance certificate, order u/s.119(2)(b) of the Act and copy of Form No.49A. Wherever wrong refunds were issued u/s.143(1)(a), the Department raised demand by passing rectification orders u/s.154 of the Act. The observation of the Assessing Officer is that the assessee did not file any confirmation from the clients proving their identity and genuineness and also not provided any of the so-called clients for IT(ss)A No.02/Rjt/2016 Shri Rajeshbhai Harsukhlal Sodha vs. DCIT Block Period 01/04/1988 to 21/04/1998 Relating to AYs 1989-90 to 1999-2000 12 verification and examination appears to be not vested on the documents which was given by the assessee during the remand proceedings. It will be appropriate to remand back this issue to the file of the Assessing Officer for proper adjudication of the same. The Assessing Officer should take cognizance of all these documents which was produced by the assessee and if the assessee files confirmation and verification of the clients, then the Assessing Officer should take cognizance of the same and passed appropriate order as per Income-tax statute. Needless to say, the assessee be given opportunity of hearing for following principles of natural justice. Thus, Ground NO.4 is partly allowed for statistical purposes. 20. As regards to Ground No. 5 relating to retaining addition of Rs. 1,70,000 made on account of loan obtained from GSFC, the Ld. AR submitted that the documents on the basis of which this addition is made is a notice from Advocate. From the wording of this notice, it is very clear that this notice contains only the allegations, Sub-para D of Para 3 says that Shri Vasrambhai Patel got a cheque of Rs. 1,70,000/- from GSFC, which he deposited in his bank account of Shri Vasrambhai Patel. This is a mere allegation. The assessee has not received any further communication from Shri Vasrambhai Patel or his advocate till date nor the department has brought on record, anything to support this allegation from Shri Vasrambhai Patel or his advocate. 21. The Ld. DR submitted that in the order dated 27.04.2000, the Assessing Officer made addition of Rs. 1,70,000/- on account of loan from GSFC through fabrication of false record obtained and appropriated but not repaid and the said addition was also retained by the Assessing Officer while passing the set aside order dated 29.12.2006. The Ld. DR submitted the claim of assessee that he had only issued a valuation certificate to Mahakali /Cement Pipe Factory, Prop. Shri Vasrambhai Mohanbhai Patel, IT(ss)A No.02/Rjt/2016 Shri Rajeshbhai Harsukhlal Sodha vs. DCIT Block Period 01/04/1988 to 21/04/1998 Relating to AYs 1989-90 to 1999-2000 13 for obtaining loan from GSFC, however, he has not been benefited in any way. The reply of the assessee is general in nature and not acceptable and the action of the Assessing Officer is justifiable. 22. We have heard both the parties and perused all the relevant material available on record. It is pertinent to note that the documents on the basis of which related to addition of Rs.1,70,000/- on account of loan obtained from GSFC is emerging from the notice of the Advocate. The contention of the assessee is that the assessee did not receive any further communication from the said party or from the Advocate was there on record before the Assessing Officer. Since there was no legal dispute raised on this issue against the assessee, the Assessing Officer cannot say that there was fabrication of false record obtained during the loan from GSFC. Thus, the addition made by the Assessing Officer to the extent of Rs.1,70,000/- is not justifiable. Hence, ground No.5 is allowed. 23. As regards to additional ground (Ground No. 6) relating to retaining of addition made of Rs. 28,97,829/- on account of income tax refund obtained through forgery on protective basis, the Ld. AR submitted that the addition confirmed is totally unjustified and uncalled for. The Ld. AR submitted that the CIT(A) himself has confirmed in the decision that Rs. 28,97,829 being alleged amount of refund obtained through forgery is a liability of the assessee. The department has raised demand by passing rectification orders against refunds issued u/s 143(1)(a) and raised demands in the name of assessee. Hence, this is a clear case of duplication of income being taxed. Liability cannot be considered as income. The Ld. AR further submitted that the department has already filed a legal suit to recover the amount of refunds issued. This case is yet to be decided by the Court. Whenever court verdict will be declared, there IT(ss)A No.02/Rjt/2016 Shri Rajeshbhai Harsukhlal Sodha vs. DCIT Block Period 01/04/1988 to 21/04/1998 Relating to AYs 1989-90 to 1999-2000 14 will be a liability payable by the assessee. Thus, the Ld. AR prayed that addition sustained by the CIT(A) on protective basis may be deleted. 24. The Ld. DR relied upon the Assessment Order and the order of the CIT(A). 25. We have heard both the parties and perused all the relevant material available on record. As regards additional ground (ground No.6), the contention of the Ld.AR that the CIT(A) himself has confirmed in the decision that Rs.28,97,829/- being alleged amount of refund obtained through forgery is the liability of the assessee, but the Department has raised demand by passing rectification orders against refunds issued u/s.143(1)(a) of the Act and raised demands in the name of the assessee. The assessee has given certain details which was not taken into account by the Assessing Officer as the ground No.4 has been dealt hereinabove, this issue also needs verification and proper adjudication. Therefore, we remand back this issue to the file of the Assessing Officer for proper verification and adjudication. Needless to say, the assessee be given opportunity of hearing by following principles of natural justice. Hence, the addition ground (ground No.6) is partly allowed for statistical purposes. 26. As regards to additional Ground (Ground No. 7) relating to charging of interest u/s 158BFA(1) of the Act, the Ld. AR submitted that in order to prepare the return for Block period, the assessee requested the department to supply the copies of seized materials. After many written requests, the department provided last set of seized material in January, 2000. The return for block period was immediately filed on 23.02.2000. Under the circumstances, the delay in filing the return of income for block period is not attributable to the assessee. Thus, interest charged u/s IT(ss)A No.02/Rjt/2016 Shri Rajeshbhai Harsukhlal Sodha vs. DCIT Block Period 01/04/1988 to 21/04/1998 Relating to AYs 1989-90 to 1999-2000 15 158BFA(1) of the Act is not justified and deserves to be deleted. The Ld. AR relied upon the following decisions: i) Bachubhai S. Antrolia vs. ACIT 103 ITD 66 (Rajkot Bench) ii) DCIT vs. Late Rattan Lal Jain (2001) 73 TTJ 364 (Patna Bench) iii) Narula Transport Co. vs. ACIT iv) CIT vs. B Nagendra Baliga (2014) 47 taxmann.com 331 (Kar. HC) v) CIT vs. Mesco Airlines Ltd. (2010) 327 ITR 554 (Del. HC) 27. The Ld. DR submitted that the charging of interest is mandatory and consequential in nature. Thus, the Ld. DR relied upon the assessment order and order of the CIT(A). 28. We have heard both the parties and perused all the relevant material available on record. As regards additional ground (ground No.7) relates to charging of interest u/s.153BFA(1) of the Act, the Department provided the last set of seized material in January-2000 and the assessee has filed return for block period immediately on 23/03/2000 and, therefore, the delay in filing the return of income for block period is not attributable to the assessee under the circumstances set out. But the section itself is a mandatory section and, therefore, the charging of interst is a consequential in nature. Hence, the Assessing Officer is directed to take appropriate decision as per income-tax statute. Additional ground (ground No.7) is partly allowed. 29. In result, appeal of the assessee is partly allowed for statistical purposes. Order pronounced in the Court on 21 st February, 2024 at Ahmedabad. Sd/- Sd/- (WASEEM AHMED) (SUCHITRA KAMBLE) ACCOUNTANT MEMBER JUDICIAL MEMBER Ahmedabad, Dated 21/02/2024 TC Nair, Sr.PS IT(ss)A No.02/Rjt/2016 Shri Rajeshbhai Harsukhlal Sodha vs. DCIT Block Period 01/04/1988 to 21/04/1998 Relating to AYs 1989-90 to 1999-2000 16 आदेश े /Copy of the Order forwarded to : 1. / The Appellant 2. / The Respondent. 3. आ र आ / Concerned CIT 4. आ र आ ) (/ The CIT(A)-1, Rajkot 5. #$ % & ,आ र ( र)/DR,ITAT, Rajkot, 6. % *+ फ ई /Guard file. आदेश & र/ BY ORDER, //TRUE COPY// ह ज र (Asstt. Registrar) आ र ( र) ITAT, Rajkot 1. Date of part-dictation (pad attached with file)- .... ....16.02.2024............... 2. Date on which the typed draft is placed before the Dictating Member ..........16.02.2024...... Other member ......21.02.2024............... 3. Date on which the approved draft comes to the Sr.P.S./P.S. - ...21.2.2024 4. Date on which the fair order is placed before the Dictating Member for Pronouncement ... 5. Date on which the file goes to the Bench Clerk......21.2.2024 6. Date on which the file goes to the Head Clerk.................................. 7. The date on which the file goes to the Assistant Registrar for signature on the order..................... 8. Date of Despatch of the Order