Appeal details
Counselvise Citation
[2015] 122 COUNSELVISE.COM (IT) 0800 (ITAT-CHENNAI)
Assessee PAN
Bench
Appeal Number
Duration Of Justice
4 year(s) 1 month(s) 7 day(s)
Appellant
Respondent
Appeal Type
Income Tax (Search & Seizure) Appeal
Pronouncement Date
24-07-2015
Appeal Filed By
Department
Order Result
Dismissed
Bench Allotted
D
Assessment Year
misc
Appeal Filed On
16-06-2011
Judgement Text
, , IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH, CHENNAI . . . , . !'# ! , % !& BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER I.T.(SS) A. NO.20/MDS/2011 & C.O. NO.10/MDS/2012 (IN I.T.(SS) A. NO.20/MDS/2011) BLOCK ASSESSMENT YEAR : 1988-89 TO 1998-99 THE ASSISTANT COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE I, TIRUCHIRAPPALI. V. SHRI S.P. RAMAMURTHY, HANSA RESIDENCY, 23/9, COLLECTORS OFFICE ROAD, TRICHY 620 001. PAN : AWFPR 3384 P (()/ APPELLANT) (RESPONDENT & CROSS-OBJECTOR) () + , / APPELLANT BY : SH. JOE SEBASTIAN, CIT -.() + , / RESPONDENT BY : SHRI S. SRIDHAR, ADVOCATE / + 0% / DATE OF HEARING : 27.05.2015 1'2 + 0% / DATE OF PRONOUNCEMENT : 24.07.2015 / O R D E R PER N.R.S. GANESAN, JUDICIAL MEMBER: THE APPEAL OF THE REVENUE IS DIRECTED AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS), TIRUCHIRA PPALLI, DATED 2 I.T.(SS) A. NO.20/MDS/2011 C.O. NO.10/MDS/2012 17.03.2011 AND PERTAINS TO BLOCK PERIOD 1988-89 TO 1998-99. THE ASSESSEE HAS FILED THE CROSS-OBJECTION. THEREFORE, WE HEARD THE APPEAL AND THE CROSS-OBJECTION TOGETHER AND DISPOSI NG OF THE SAME BY THIS COMMON ORDER. 2. THE FIRST GROUND IN THE REVENUES APPEAL IS WITH REGARD TO THE ADDITION MADE BY THE ASSESSING OFFICER TO THE EXTEN T OF ` 24.5 LAKHS TOWARDS INVESTMENT IN MONEY LENDING BUSINESS. 3. SH. JOE SEBASTIAN, THE LD. DEPARTMENTAL REPRESEN TATIVE, SUBMITTED THAT THERE WAS A SEARCH IN THE RESIDENTIA L PREMISES OF THE ASSESSEE ON 11.12.1997. A SURVEY WAS ALSO SIMULTAN EOUSLY CONDUCTED UNDER SECTION 133A OF THE INCOME-TAX ACT, 1961 (IN SHORT 'THE ACT') AT THE BUSINESS PREMISES OF THE ASSESSEE . THE REVENUE AUTHORITIES FOUND 1356.112 GMS OF JEWELLERY, OUT OF WHICH 843.536 GMS OF JEWELLERY WERE SEIZED. THE REVENUE AUTHORIT IES ALSO FOUND ` 415 IN CASH. HOWEVER, THE SAME WAS NOT SEIZED. TH E REVENUE AUTHORITIES SEIZED SEVERAL INCRIMINATING MATERIAL R ELATING TO MONEY LENDING BUSINESS OF THE ASSESSEE BESIDES JEWELLERY BUSINESS AND FILM DISTRIBUTION. A SWORN STATEMENT WAS ALSO RECO RDED ON 11.12.1997 AND 16.01.1998 FROM THE ASSESSEE AND HIS WIFE SMT. R. KUMUTHAVALLI. 3 I.T.(SS) A. NO.20/MDS/2011 C.O. NO.10/MDS/2012 4. THE LD. DEPARTMENTAL REPRESENTATIVE FURTHER SUBM ITTED THAT DURING THE COURSE OF SEARCH OPERATION, 112 PRO-NOTE S WERE SEIZED. OUT OF WHICH, 55 PRO-NOTES DISCLOSES THE AMOUNT ADV ANCED BY THE ASSESSEE TO THE EXTENT OF ` 1,05,65,000/-. THE REMAINING PRO-NOTES ARE BLANK EVEN THOUGH THE ASSESSEE OBTAINED THE SIG NATURES. WHILE EXAMINING, THE ASSESSEE ADMITTED THAT THE LOAN OUTS TANDING IN THE MONEY LENDING BUSINESS WAS ` 25 LAKHS. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSEE ADMITTED THE A DVANCES AT ` 24,50,000/- INSTEAD OF ` 25 LAKHS AND CLAIMED A BAD DEBT OF ` 13 LAKHS. OUT OF THIS ` 13 LAKHS, ` 5 LAKHS WAS SAID TO BE ADVANCED TO ONE SHRI S.A. ALAGAPPAN AND ANOTHER SUM OF ` 8 LAKHS ADVANCED TO ONE SHRI S.P. SATHYAMURTHY. ACCORDING TO THE LD. D .R., THE ASSESSEE HAS NOT MAINTAINED ANY REGULAR BOOKS OF AC COUNT IN MONEY LENDING BUSINESS. THEREFORE, THE ASSESSEE CA NNOT CLAIM THAT THERE WAS ANY BAD DEBT IN THE MONEY LENDING BUSINES S. REFERRING TO THE ASSESSMENT ORDER, THE LD. D.R. SUBMITTED THAT T HE ASSESSEE HIMSELF ADMITTED THAT THE PRO-NOTES SEIZED WERE ALR EADY DISCHARGED. THEREFORE, THE ASSESSING OFFICER REJECTING THE CLAI M OF BAD DEBTS TO THE EXTENT OF ` 13 LAKHS, ASSESSED THE OUTSTANDING AMOUNT ON THE DATE OF SEARCH AT ` 24,50,000/- AS ADMITTED. HOWEVER, ON APPEAL BY THE ASSESSEE, THE CIT(APPEALS), AFTER REFERRING TO THE BALANCE SHEET 4 I.T.(SS) A. NO.20/MDS/2011 C.O. NO.10/MDS/2012 FILED BY THE ASSESSEE BEFORE THE ASSESSING OFFICER, FOUND THAT THE ADVANCE MADE BY THE ASSESSEE TO THE EXTENT OF ` 24,50,000/- WAS REFLECTED IN THE BALANCE SHEET AND AFTER MAKING ADJ USTMENT OF ` 13 LAKHS TOWARDS BAD DEBTS, THE NET BALANCE OF ` 11,50,000/- WAS ALSO REFLECTED IN THE ASSET SIDE OF THE BALANCE SHEET. ACCORDING TO THE LD. D.R., THE ASSESSEE HAS NOT MAINTAINED ANY BOOKS , THEREFORE, THE CLAIM OF BAD DEBT CANNOT BE ACCEPTED. MERELY BECAU SE THE ADVANCE AS WELL AS THE BAD DEBT WERE REFLECTED IN T HE BALANCE SHEET FILED BY THE ASSESSEE BEFORE THE ASSESSING OFFICER, IT DOES NOT MEAN THAT THE BAD DEBT WAS WRITTEN OFF. 5. ON THE CONTRARY, SHRI S. SRIDHAR, THE LD.COUNSEL FOR THE ASSESSEE, SUBMITTED THAT DURING THE COURSE OF SEARC H OPERATION, ADMITTEDLY, THE REVENUE AUTHORITIES FOUND PRO-NOTES . THOUGH THE ASSESSEE ADMITTED THE OUTSTANDING AMOUNT IN THE MON EY LENDING BUSINESS WAS ` 25 LAKHS IN THE STATEMENT DATED 11.12.1997, WHILE FILING THE RETURN OF INCOME, THE ASSESSEE CLAIMED T HE OUTSTANDING AMOUNT ONLY AS ` 24,50,000/- AND IN SUPPORT, THE ASSESSEE FILED THE BALANCE SHEET. IN FACT, THE ASSESSING OFFICER ACC EPTED THE ADVANCE OF ` 24,50,000/- MADE BY THE ASSESSEE ON THE BASIS OF TH E BALANCE SHEET INSTEAD OF ` 25 LAKHS ADMITTED IN THE SWORN STATEMENT DATED 11.12.1997. IN THIS CASE, ACCORDING TO THE LD. COU NSEL, WHAT WAS 5 I.T.(SS) A. NO.20/MDS/2011 C.O. NO.10/MDS/2012 DISBELIEVED BY THE ASSESSING OFFICER IS WITH REGARD TO BAD DEBT WHICH WAS SHOWN IN THE VERY SAME BALANCE SHEET. ON CE THE ASSESSING OFFICER ACCEPTED THE OUTSTANDING AMOUNT O F ` 24,50,000/- INSTEAD OF ` 25 LAKHS AS PER THE SWORN STATEMENT, THE AMOUNT DISCLOSED IN THE ASSET SIDE OF THE BALANCE SHEET CA NNOT BE IGNORED. ACCORDING TO THE LD. COUNSEL, THE ASSESSING OFFICER HAS TO ACCEPT THE BALANCE SHEET FILED BY THE ASSESSEE IN TOTO OR REJECT IN TOTO. FOR THE PURPOSE OF HIS CONVENIENCE, HE ADOPTED ` 24,50,000/-, HOWEVER, WITHOUT ANY REASON HE REJECTED THE BAD DEBT. THERE FORE, ACCORDING TO THE LD. COUNSEL, THE BALANCE SHEET DISCLOSES THE ADVANCE AMOUNT OF ` 24,50,000/-. THEREFORE, THE CIT(APPEALS) DELETED T HE ENTIRE OUTSTANDING AMOUNT OF ` 24,50,000/- RIGHTLY. 6. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EITH ER SIDE AND PERUSED THE RELEVANT MATERIAL ON RECORD. ADMITTEDL Y, THERE WAS A SEARCH AT THE RESIDENCE OF THE ASSESSEE ON 11.12.19 97. THE REVENUE AUTHORITIES FOUND 112 PRO-NOTES. OUT OF 11 2 PRO-NOTES, 55 PRO-NOTES WERE SEIZED. DURING EXAMINATION, THE ASS ESSEE ADMITTED THAT THE LOAN OUTSTANDING IN THE MONEY LENDING BUSI NESS WAS ` 25 LAKHS. HOWEVER, WHILE FILING THE RETURN OF INCOME, THE ASSESSEE DISCLOSED THE OUTSTANDING AMOUNT AT ` 24,50,000/- ON THE BASIS OF THE BALANCE SHEET AS ON THE DATE OF SEARCH. FROM T HE ORDER OF THE 6 I.T.(SS) A. NO.20/MDS/2011 C.O. NO.10/MDS/2012 CIT(APPEALS), IT APPEARS THAT THE ASSESSEE HAS CLAI MED THAT THE PRO-NOTES FOUND AND SEIZED WERE THREE YEARS OLD, TH EREFORE, THE LEGAL ACTION IS BARRED TO RECOVER THE MONEY. ADMIT TEDLY, THE ASSESSING OFFICER ADMITTED THE OUTSTANDING AMOUNT A S ON THE DATE OF SEARCH AT ` 24,50,000/- ON THE BASIS OF THE BALANCE SHEET EVEN THOUGH THE ASSESSEE CLAIMED THAT THE OUTSTANDING AM OUNT WAS ` 25 LAKHS ON THE DATE OF SEARCH. WHEN THE ASSESSING OF FICER ADMITTED THAT THE OUTSTANDING AMOUNT WAS ` 24,50,000/- ON THE BASIS OF THE BALANCE SHEET, THIS TRIBUNAL IS OF THE CONSIDERED O PINION THAT THE BAD DEBT WHICH WAS CLAIMED ON THE BASIS OF THE BALA NCE SHEET ALSO NEEDS TO BE ADMITTED. IN OTHER WORDS, THE BALANCE SHEET SHALL BE ADMITTED IN TOTO OR REJECTED IN TOTO. THE ASSESSEE ADMITTEDLY HAS NOT MAINTAINED ANY BOOKS OF ACCOUNT. THE ASSESSEE PREPARED THE BALANCE SHEET AS ON THE DATE OF SEARCH, ON THE BASI S OF THE MATERIAL AVAILABLE. THE CIT(APPEALS) FOUND THAT THE ASSESSI NG OFFICER MADE THE ADDITION ONLY ON THE REASON THAT THE SAID ADVAN CE OF ` 24,50,000/- WAS NOT REFLECTED IN THE RETURN FILED B EFORE THE SEARCH. THE FACT REMAINS THAT THE BALANCE SHEET ON THE DATE OF SEARCH SHOWS THE ADVANCE MADE AND THE BAD DEBT SAID TO BE REMAINED UNRECOVERED FROM SHRI S.A. ALAGAPPAN AND SHRI S.P. SATHYAMURTHY. IN THOSE CIRCUMSTANCES, THIS TRIBUNAL IS OF THE CON SIDERED OPINION 7 I.T.(SS) A. NO.20/MDS/2011 C.O. NO.10/MDS/2012 THAT THE CIT(APPEALS) HAS RIGHTLY DELETED THE ADDIT ION OF ` 24,50,000/- MADE BY THE ASSESSING OFFICER. 7. THE NEXT GROUND OF APPEAL IS WITH REGARD TO DELE TION OF ADDITION OF ` 7 LAKHS TOWARDS UNDISCLOSED INVESTMENT IN KAVITHA JEWELLERY. 8. SH. JOE SEBASTIAN, THE LD. DEPARTMENTAL REPRESEN TATIVE, SUBMITTED THAT DURING THE COURSE OF SURVEY PROCEEDI NGS UNDER SECTION 133A OF THE ACT, THE ASSESSEE ADMITTED THAT THE INITIAL CAPITAL IN THE JEWELLERY BUSINESS WAS ` 7 LAKHS. MOREOVER, DURING THE COURSE OF SEARCH, THE ASSESSEE ADMITTED THAT THE IN ITIAL CAPITAL OUTLAY IN JEWELLERY BUSINESS WAS OUT OF THE INCOME EARNED FROM MONEY LENDING BUSINESS. SINCE THE ASSESSEE WAS FOU ND TO BE CARRYING ON THE MONEY LENDING BUSINESS FROM 1981 TO 1990, THE ASSESSING OFFICER CONSIDERED THE INVESTMENT OF ` 7 LAKHS AS UNDISCLOSED INCOME FOR THE ASSESSMENT YEAR 1991-92. ACCORDING TO THE LD. D.R., THE CIT(APPEALS) DELETED THE ADDITION ON THE GROUND THAT THE INVESTMENT IN THE JEWELLERY BUSINESS WAS A SSESSED UNDER SECTION 143(3) OF THE ACT, CONSEQUENT TO THE SURVEY ON 31.03.1997. ACCORDING TO THE LD. D.R., IN THE ABSENCE OF ANY MA TERIAL, THE CIT(APPEALS) OUGHT NOT HAVE DELETED THE ADDITION. 8 I.T.(SS) A. NO.20/MDS/2011 C.O. NO.10/MDS/2012 9. ON THE CONTRARY, SHRI S. SRIDHAR, THE LD.COUNSEL FOR THE ASSESSEE, SUBMITTED THAT NO MATERIAL WAS FOUND DURI NG THE COURSE OF SEARCH OR SURVEY. THE ASSESSING OFFICER SIMPLY PLACED RELIANCE ONLY ON THE STATEMENT RECORDED FROM THE ASSESSEE DU RING THE SURVEY OPERATION UNDER SECTION 133A OF THE ACT. ACCORDING TO THE LD. COUNSEL, THE STATEMENT RECORDED DURING THE SURVEY O PERATION CANNOT BE BASIS FOR MAKING ADDITION FOR THE BLOCK PERIOD. THE INVESTMENT IN THE BUSINESS OF KAVITHA JEWELLERY WAS BROUGHT TO TH E NOTICE OF THE DEPARTMENT ON 10.11.1995, WHEN THE SEARCH WAS CONDU CTED IN THE PREMISES OF THE KAVITHA JEWELLERY. THEREFORE, THE INVESTMENT MADE BY THE ASSESSEE TO THE EXTENT OF ` 7 LAKHS WAS WITHIN THE KNOWLEDGE OF THE DEPARTMENT AND IN FACT, THE ASSESSMENT WAS A LSO MADE UNDER SECTION 143(3) OF THE ACT ON 31.03.1997 BEFOR E THE DATE OF SEARCH. THEREFORE, ACCORDING TO THE LD. COUNSEL, T HE CIT(APPEALS) HAS RIGHTLY DELETED THE ADDITION. 10. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EIT HER SIDE AND PERUSED THE RELEVANT MATERIAL ON RECORD. IT IS NOT IN DISPUTE THAT THE ASSESSEE DISCLOSED THE INVESTMENT OF ` 7 LAKHS IN THE JEWELLERY BUSINESS ON 10.11.1995. A SIMILAR STATEMENT WAS AL SO MADE BEFORE THE ADDITIONAL DIRECTOR OF INCOME TAX (INVESTIGATIO N), TRICHY, ON 9 I.T.(SS) A. NO.20/MDS/2011 C.O. NO.10/MDS/2012 20.8.1996. THE ASSESSMENT IN THE CASE OF KAVITHA J EWELLERY WITH REGARD TO ` 7 LAKHS WAS COMPLETED UNDER SECTION 143(3) OF THE A CT ON 31.03.1997. THEREFORE, THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT THE INVESTMENT MADE IN THE JEWELLERY BUSINESS IN THE NAME OF KAVITHA JEWELLERY WAS WITHIN THE KNOWLEDGE OF THE D EPARTMENT BEFORE THE DATE OF SEARCH. THEREFORE, IN THE ABSEN CE OF FURTHER MATERIAL, THIS TRIBUNAL IS OF THE CONSIDERED OPINIO N THAT THE CIT(APPEALS) HAS RIGHTLY DELETED THE ADDITION. THI S TRIBUNAL DO NOT FIND ANY INFIRMITY IN THE ORDER OF THE CIT(APPEALS) AND ACCORDINGLY, THE SAME IS CONFIRMED. 11. THE NEXT GROUND OF APPEAL IS WITH REGARD TO ADD ITION MADE BY THE ASSESSING OFFICER TOWARDS FILM DISTRIBUTION BUS INESS. 12. SH. JOE SEBASTIAN, THE LD. DEPARTMENTAL REPRESE NTATIVE, SUBMITTED THAT DURING THE COURSE OF SEARCH ON 11.12 .1997, IN RESPONSE TO QUESTION NO.3, THE ASSESSEE CLARIFIED T HAT A SUM OF ` 15 LAKHS WAS INVESTED IN THE YEAR 1996. THE ASSESSEE HAS ALSO ADMITTED THAT FOUR FILMS WERE DISTRIBUTED BY HIM DU RING THE BLOCK PERIOD. THE ASSESSEE FURTHER ADMITTED THAT HE PURC HASED THE FILM CALLED KATHAL KOTTAI FOR ` 60 LAKHS AND EARNED THE PROFIT OF ` 10 LAKHS. ADMITTEDLY, THE ASSESSEE HAS NOT MAINTAINED ANY BOOKS IN 10 I.T.(SS) A. NO.20/MDS/2011 C.O. NO.10/MDS/2012 THE REGULAR COURSE OF BUSINESS. EVEN THOUGH THE AS SESSEE CLAIMED THAT A SUM OF ` 60 LAKHS WAS INVESTED, THE AGREEMENT ENTERED INTO BETWEEN THE PARTIES DISCLOSES THE COST OF THE FILM KATHAL KOTTAI AT ` 36 LAKHS. THE ADVANCE PAID BY THE THEATRE OWNERS W AS DETERMINED AT ` 45 LAKHS AS AGAINST ` 27 LAKHS WHICH WAS DISCLOSED IN THE AGREEMENT. THEREFORE, THE ASSESSING OFFICER TREATED A SUM OF ` 9 LAKHS AS UNDISCLOSED INCOME FROM FILM DISTRIBUTIO N. SIMILARLY, IN RESPECT OF THE FILM PERIYA IDATHU MAPPILLAI FROM SHRI MURUGAN, THE ASSESSEE CLAIMED THAT THE SAID FILM WAS PURCHASED F OR ` 22 LAKHS IN THE YEAR 1997. THE KNOWN SOURCE OF INCOME FOR MAKI NG THE INVESTMENT WAS ONLY ` 11 LAKHS WHICH WAS COLLECTED DIRECTLY FROM THE THEATRE OWNERS. THE BALANCE AMOUNT OF ` 11 LAKHS WAS TREATED BY THE ASSESSING OFFICER AS UNDISCLOSED INCOME FROM TH E FILM PERIYA IDATHU MAPPILLAI. COMING TO THE INVESTMENT MADE B Y THE ASSESSEE IN THE FILM CALLED MEETUKUDI, THE LD. D.R. SUBMIT TED THAT THE ASSESSEE CLAIMED THAT THE SAID FILM WAS PURCHASED I N THE YEAR 1997 FOR ` 3 LAKHS. THE ASSESSEE ALSO CLAIMED THAT ANOTHER FI LM CALLED VIVASAYE MAGAN WAS PURCHASED FOR ` 2 LAKHS. IN THE FILM METTUKUDI, THE ASSESSEE CLAIMED THAT A SUM OF ` 3 LAKHS WAS COLLECTED. HOWEVER, FROM THE FILM VIVASAYE MAGAN , ` 2,80,000/- WAS COLLECTED TOWARDS HIS SHARE. ACCORDING TO THE LD. D.R., THE 11 I.T.(SS) A. NO.20/MDS/2011 C.O. NO.10/MDS/2012 INVESTMENT IN THE SAID TWO FILMS CAME TO ` 5 LAKHS FOR WHICH THE ASSESSEE COULD NOT EXPLAIN THE SOURCE. THEREFORE, ACCORDING TO THE LD. D.R., THE ASSESSING OFFICER HAS RIGHTLY MADE TH E ADDITION. 13. ON THE CONTRARY, SHRI S. SRIDHAR, THE LD.COUNSE L FOR THE ASSESSEE, SUBMITTED THAT ADMITTEDLY THERE WAS NO SE ARCH MATERIAL WITH REGARD TO FILM DISTRIBUTION BUSINESS. THE ENT IRE ADDITION WAS MADE ONLY ON THE BASIS OF THE STATEMENT MADE BY THE ASSESSEE. ACCORDING TO THE LD. COUNSEL, BLOCK ASSESSMENT HAS TO BE MADE ONLY ON THE BASIS OF THE MATERIAL FOUND DURING THE COURSE OF SEARCH OPERATION IN VIEW OF SECTION 158BB OF THE ACT. IN THIS CASE, NO MATERIAL WAS FOUND DURING THE COURSE OF SEARCH OPER ATION. REFERRING TO THE ASSESSMENT ORDER, MORE PARTICULARLY AT PARA 7.3, THE LD.COUNSEL CLARIFIED THAT EVEN THE ASSESSING OFFICE R CLEARLY SAYS THAT THE SEIZED MATERIAL DOES NOT THROW ANY LIGHT IN THE INVESTMENT MADE BY THE ASSESSEE IN FILM DISTRIBUTION BUSINESS. THE REFORE, ACCORDING TO THE LD. COUNSEL, IN THE ABSENCE OF ANY SEARCH MA TERIAL, THE CIT(APPEALS) HAS RIGHTLY DELETED THE ADDITION. 14. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EIT HER SIDE AND PERUSED THE RELEVANT MATERIAL ON RECORD. ADMITTEDL Y, THE ASSESSING OFFICER MADE AN ADDITION OF ` 25 LAKHS IN RESPECT OF INVESTMENT MADE 12 I.T.(SS) A. NO.20/MDS/2011 C.O. NO.10/MDS/2012 BY THE ASSESSEE IN FOUR FILMS, NAMELY, KATHAL KOTT AI, PERIYA IDATHU MAPILLAI, METTUKUDI AND VIVASAYE MAGAN. THE A SSESSING OFFICER AT PARA 7.3 OF HIS ORDER CLEARLY SAYS THAT THE SEIZ ED MATERIAL DOES NOT THROW ANY LIGHT WITH REGARD TO INCOME FROM DIST RIBUTION OF FILM. THE ENTIRE ADDITION WAS ADMITTEDLY MADE ONLY ON THE BASIS OF THE STATEMENT RECORDED ON 11.12.1997. THE CIT(APPEALS) , WHILE DELETING THE ADDITION TO THE EXTENT OF ` 16 LAKHS, CONFIRMED THE ADDITION OF ` 9 LAKHS. THE ASSESSEE HAS FILED A CROSS-OBJECTION WITH REGARD TO THE ADDITION RESTRICTED BY THE CIT(APPEAL S) TO THE EXTENT OF ` 9 LAKHS FROM FILM DISTRIBUTION BUSINESS. THE CIT(A PPEALS) FOUND THAT THE ASSESSEE EXPLAINED THAT A SUM OF ` 45 LAKHS WAS COLLECTED DIRECTLY FROM THE THEATRE OWNERS AND ANOTHER SUM OF ` 6 LAKHS WAS RECEIVED BY THE ASSESSEE BY PLEDGING THE JEWELLERY. THEREFORE, THE INVESTMENT TO THE EXTENT OF ` 9 LAKHS REMAINED UNEXPLAINED. THE FACT REMAINS THAT THE ASSESSMENT PROCEEDING WAS FOR THE BLOCK PERIOD AND THE ASSESSING OFFICER IS EXPECTED TO COM PUTE THE UNDISCLOSED INCOME ON THE BASIS OF THE MATERIAL FOU ND DURING THE COURSE OF SEARCH OPERATION AND THE INFORMATION WHIC H IS RELATABLE TO THE MATERIAL FOUND DURING THE COURSE OF SEARCH OPER ATION. THE ASSESSING OFFICER HIMSELF CLARIFIES THAT THE SEARCH MATERIAL DOES NOT THROW ANY LIGHT WITH REGARD TO EARNING OF THE INCOM E. THEREFORE, THE 13 I.T.(SS) A. NO.20/MDS/2011 C.O. NO.10/MDS/2012 STATEMENT MADE BY THE ASSESSEE DURING THE COURSE OF EXAMINATION MAY NOT BE RELATABLE TO THE MATERIAL FOUND DURING T HE COURSE OF SEARCH OPERATION. THIS TRIBUNAL IS OF THE CONSIDER ED OPINION THAT IN THE ABSENCE OF ANY SEARCH MATERIAL, NO ADDITION CAN BE MADE ON THE BASIS OF THE INFORMATION AVAILABLE WITH THE ASSESSI NG OFFICER SINCE THE SAME DOES NOT RELATE TO THE MATERIAL FOUND DURI NG COURSE OF SEARCH OPERATION. THIS TRIBUNAL IS OF THE CONSIDER ED OPINION THAT IN VIEW OF THE EXPRESS LANGUAGE OF SECTION 158BB OF TH E ACT, THE ASSESSING OFFICER HAS TO NECESSARILY CONFINE HIMSEL F TO THE MATERIAL FOUND DURING THE COURSE OF SEARCH OPERATION. THERE FORE, THE CIT(APPEALS), WHILE DELETING THE ADDITION TO THE EX TENT OF ` 16 LAKHS IS NOT JUSTIFIED IN CONFIRMING THE ADDITION OF ` 9 LAKHS. THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT THE ENTIRE ADDITION OF ` 25 LAKHS OUGHT TO HAVE BEEN DELETED SINCE NO SEARCH MATERIAL WAS F OUND DURING THE COURSE OF SEARCH OPERATION REGARDING EARNING OF THE INCOME. THEREFORE, THE ORDER OF THE CIT(APPEALS) IS MODIFIE D AND THE ASSESSING OFFICER IS DIRECTED TO DELETE THE ENTIRE ADDITION. 15. THE NEXT GROUND OF APPEAL IS WITH REGARD TO THE ADDITION OF ` 1,80,000/- TOWARDS UNDISCLOSED INVESTMENT IN JEWELL ERY. 14 I.T.(SS) A. NO.20/MDS/2011 C.O. NO.10/MDS/2012 16. SH. JOE SEBASTIAN, THE LD. DEPARTMENTAL REPRESE NTATIVE, SUBMITTED THAT THE CIT(APPEALS) DELETED THE ADDITIO N MADE BY THE ASSESSING OFFICER ON THE GROUND THAT THE ASSESSEE H AS DISCLOSED THE SAME IN THE BALANCE SHEET. ACCORDING TO THE LD . D.R., DURING THE COURSE OF SEARCH OPERATION, 1356.112 GMS OF GOL D JEWELLERY WAS FOUND IN THE RESIDENTIAL PREMISES OF THE ASSESSEE, OUT OF WHICH, 843.536 GMS OF JEWELLERY WERE SEIZED. THE ASSESSEE ADMITTED BEFORE THE REVENUE AUTHORITIES THAT THIS JEWELLERY WAS HIS PERSONAL JEWELLERY AND DOES NOT RELATE TO STOCK-IN-TRADE. T HE ASSESSEE HAS ALSO CLAIMED THAT 1412 GMS OF JEWELLERY WERE PLEDGE D FOR A SUM OF `6 LAKHS. THE ASSESSEE CLAIMED THAT THE VERY SAME JE WELLERY WAS FOUND DURING THE COURSE OF SEARCH OPERATION. WHEN THE ASSESSEE CLAIMED THAT THE PLEDGED JEWELLERY WAS REDEEMED, HE COULD NOT EXPLAIN THE SOURCE OF REPAYMENT OF LOAN FOR REDEEMI NG THE JEWELLERY. THE ASSESSEE ALSO ADMITTED BEFORE THE REVENUE AUTHO RITIES THAT 100 SOVEREIGNS WERE RECEIVED FROM HIS FATHER-IN-LAW AND THE BALANCE OF 556 GMS OF JEWELLERY WAS PURCHASED BY HIM OUT OF HI S UNACCOUNTED INCOME WHICH COMES TO NEARLY ` 1,80,000/-. THEREFORE, THE ASSESSING OFFICER FOUND THAT THE PLEDGED JEWELLERY OF 1412 GMS WAS DIFFERENT FROM WHAT WAS FOUND DURING THE COURSE OF SEARCH OPERATION. THEREFORE, THE ASSESSING OFFICER MADE A N ADDITION OF 15 I.T.(SS) A. NO.20/MDS/2011 C.O. NO.10/MDS/2012 ` 6,30,000/- BEING THE COST OF 1968 GMS OF JEWELLERY. ON APPEAL BY THE ASSESSEE, THE CIT(APPEALS) SUSTAINED THE ADDITI ON OF ` 4,50,000/- AND DELETED THE ADDITION OF ` 1,80,000/-. THE ASSESSEE HAS FILED CROSS-OBJECTION WITH REGARD TO CONFIRMATI ON OF DISALLOWANCE TO THE EXTENT OF ` 4,50,000/- AND THE REVENUE IS IN APPEAL WITH REGARD TO DELETION OF ADDITION OF ` 1,80,000/-. 17. ON THE CONTRARY, SHRI S. SRIDHAR, THE LD.COUNSE L FOR THE ASSESSEE, SUBMITTED THAT DURING THE COURSE OF SEARC H OPERATION, THE REVENUE AUTHORITIES FOUND 1356.112 GMS OF GOLD JEWE LLERY OUT OF WHICH, 843.536 GMS WERE SEIZED. THE ASSESSEE CLAIM ED THAT PART OF THE SEIZED JEWELLERY WAS HIS PERSONAL ONE AND TH E OTHER PART WAS ACQUIRED FROM HIS PERSONAL EARNINGS. THE ASSESSEE ALSO CLAIMED THAT PART OF THE JEWELLERY WAS PLEDGED. HOWEVER, T HE ASSESSING OFFICER DISBELIEVED THE CLAIM OF THE ASSESSEE. THO UGH THE ASSESSEE CLAIMED THAT 1412 GMS OF JEWELLERY WAS PLEDGED, THE REVENUE AUTHORITIES FOUND DURING THE SEARCH OPERATION ONLY 1356 GMS OF JEWELLERY. THE ASSESSEE HAS ALSO ADMITTED BEFORE T HE REVENUE AUTHORITIES THAT 100 SOVEREIGNS OF RECEIVED FROM HI S FATHER-IN-LAW AND THE BALANCE 556 GMS OF JEWELLERY WAS PURCHASED BY HIM OUT OF HIS UNACCOUNTED MONEY TO THE EXTENT ` 1,80,000/-. THE LD.COUNSEL POINTED OUT THAT 1412 GMS OF JEWELLERY PLEDGED WITH SHRI SEKAR ARE 16 I.T.(SS) A. NO.20/MDS/2011 C.O. NO.10/MDS/2012 THE SAME WHICH WERE FOUND DURING THE COURSE OF SEAR CH OPERATION. THEREFORE, THE CIT(APPEALS) RIGHTLY DELETED THE ADD ITION MADE BY THE ASSESSING OFFICER. 18. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EIT HER SIDE AND PERUSED THE RELEVANT MATERIAL ON RECORD. ADMITTEDL Y, DURING THE COURSE OF SEARCH OPERATION, 1356.112 GMS OF GOLD JE WELLERY WAS FOUND AT THE RESIDENTIAL PREMISES OF THE ASSESSEE. THE ASSESSEE CLAIMED THAT HE WAS IN POSSESSION OF 1412 GMS OF JE WELLERY WHICH WAS PLEDGED WITH ONE SHRI SEKAR AND OBTAINED THE LO AN OF ` 6 LAKHS FOR MAKING INITIAL PAYMENT FOR PURCHASING OF THE FI LM KATHAL KOTTAI. THE ASSESSING OFFICER DISBELIEVED THE CLAIM OF THE ASSESSEE. HOWEVER, THE CIT(APPEALS) FOUND THAT THE CLAIM OF T HE ASSESSEE THAT HE PLEDGED THE ENTIRE JEWELLERY AVAILABLE WITH HIM FOR A SHORT PERIOD OF SIX MONTHS WAS CONTRARY TO NORMAL HUMAN B EHAVIOUR. THE CIT(APPEALS) HAS ALSO FOUND THAT THE ASSESSEE HAD S OME JEWELLERY OTHER THAN THE ONE PLEDGED BY HIM AND HE HAS NOT BR OUGHT OUT ANY OTHER MATERIAL OR EXPLANATION TO DISPROVE THE OBSER VATION OF THE ASSESSING OFFICER THAT THE JEWELLERY PLEDGED AND TH E JEWELLERY FOUND ARE TWO DIFFERENT QUANTITIES. ACCORDINGLY, THE CIT (APPEALS) CONFIRMED THE ADDITION OF ` 4,50,000/- MADE BY THE ASSESSING OFFICER TOWARDS THE COST OF 1412 GMS OF GOLD JEWELLERY. CO MING TO THE 17 I.T.(SS) A. NO.20/MDS/2011 C.O. NO.10/MDS/2012 ADDITION OF ` 1,80,000/- WITH REGARD TO 556 GMS OF JEWELLERY, THE CIT(APPEALS) FOUND THAT THE INVESTMENT OF ` 1,80,000/- WAS REFLECTED IN THE BALANCE SHEET AS ON THE DATE OF SEARCH FILED BY THE ASSESSEE. FOR MAKING ADDITION OF ` 4,50,000/- WITH REGARD TO MONEY LENDING BUSINESS, THE ASSESSING OFFICER HAS ACCEPTED THE CL AIM OF THE ASSESSEE IN THE BALANCE SHEET. HOWEVER, THE ASSESS ING OFFICER DISBELIEVED THE CLAIM OF INVESTMENT WITH REGARD TO 556 GMS OF GOLD JEWELLERY. AS ALREADY OBSERVED, THE ASSESSING OFFI CER HAS TO EITHER ACCEPT THE BALANCE SHEET IN TOTO OR REJECT IN TOTO. THE ASSESSING OFFICER CANNOT PARTLY ACCEPT THE CLAIM OF THE ASSES SEE RELYING ON THE BALANCE SHEET AT HIS CONVENIENCE AND REST OF THE TH INGS CANNOT BE REJECTED. THEREFORE, THIS TRIBUNAL IS OF THE CONSI DERED OPINION THAT THE CIT(APPEALS) HAS RIGHTLY DELETED THE ADDITION O F ` 1,80,000/-. THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT THE CIT(APPEALS) HAS RIGHTLY CONFIRMED THE ADDITION OF ` 4,50,000/-. THIS TRIBUNAL DO NOT FIND ANY INFIRMITY IN THE ORDER OF THE CIT(APPEALS) AND ACCORDINGLY THE SAME IS CONFIRMED. 19. NOW COMING TO UNDISCLOSED INVESTMENT IN THE PLO T TO THE EXTENT OF ` 2,82,000/-, SH. JOE SEBASTIAN, THE LD. D.R. SUBMITT ED THAT THE ASSESSEE PURCHASED A PLOT OF LAND AT RAMLI NGA NAGAR, TRICHY ON 10.02.1995 FOR ` 3,03,340/-. DURING EXAMINATION, THE 18 I.T.(SS) A. NO.20/MDS/2011 C.O. NO.10/MDS/2012 ASSESSEE ADMITTED THAT THE ACTUAL COST OF THIS PROP ERTY WAS ` 5,42,000/- INCLUDING THE STAMP DUTY OF ` 30,000/-. HOWEVER, THE VALUE OF THE LAND WAS DISCLOSED IN THE SALE DEED AT ` 2,62,000/-. THE ASSESSEE HAS ALSO ADMITTED THE PAYMENT OF ON-MONEY TO THE EXTENT OF ` 2,50,000/- TO ONE SHRI BALAKRISHNA PILLAI, TRICHY. DURING THE SURVEY OPERATION, THE ASSESSEE IN HIS SWORN STATEME NT CONFIRMED THIS FACT. THEREFORE, THE ASSESSING OFFICER FOUND THAT THE ENTIRE SUM OF ` 5,42,000/- WAS THE UNDISCLOSED INVESTMENT MADE BY T HE ASSESSEE IN THE PLOT. HOWEVER, ULTIMATELY, THE ASS ESSING OFFICER FOUND THAT THE ASSESSEE ADMITTED THE DOCUMENT VALUE TO THE EXTENT OF ` 2,60,000/- IN THE HANDS OF HIS WIFE SMT. R. KUMUTHA VALLI FOR THE ASSESSMENT YEAR 1995-96. AFTER VERIFYING THE INCOM E-TAX RETURN FILED BY SMT. KUMUTHAVALLI, THE ASSESSING OFFICER M ADE AN ADDITION OF ` 2,82,000/- AS UNDISCLOSED INVESTMENT. HOWEVER, ON APPEAL BY THE ASSESSEE, THE CIT(APPEALS) DELETED THE ADDITION ON THE GROUND THAT THERE WAS NO MATERIAL OTHER THAN THE SWORN STA TEMENT. ACCORDING TO THE LD. D.R., WHEN THE ASSESSEE HIMSEL F ADMITTED THE INVESTMENT, THE CIT(APPEALS) OUGHT NOT HAVE DELETED THE ADDITION. 20. ON THE CONTRARY, SHRI S. SRIDHAR, THE LD.COUNSE L FOR THE ASSESSEE, SUBMITTED THAT NO MATERIAL WAS FOUND DURI NG THE SEARCH OPERATION WITH REGARD TO PAYMENT OF ON-MONEY. THE STATEMENT SAID 19 I.T.(SS) A. NO.20/MDS/2011 C.O. NO.10/MDS/2012 TO BE RECORDED DURING THE COURSE OF SURVEY OPERATIO N IS NOT BINDING ON THE ASSESSEE. ACCORDING TO THE LD.COUNSEL, THE REVENUE AUTHORITIES ARE NOT EMPOWERED TO ADMINISTER OATH DU RING THE SURVEY OPERATION. MOREOVER, THE MATERIAL SEIZED DURING TH E SURVEY OPERATION CANNOT BE MADE USE FOR COMPLETING THE BLO CK ASSESSMENT. ACCORDING TO THE LD. COUNSEL, FOR BLOC K ASSESSMENT, ONLY THE MATERIAL FOUND DURING THE SEARCH OPERATION ALONE NEEDS TO BE CONSIDERED. 21. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EIT HER SIDE AND PERUSED THE RELEVANT MATERIAL ON RECORD. ADMITTEDL Y, THE ASSESSEE PURCHASED THE PROPERTY IN HIS WIFES NAME SMT. R. K UMUTHAVALLI. THE PURCHASE OF PROPERTY WAS REFLECTED IN THE INCOM E-TAX RETURN FILED BY THE ASSESSEES WIFE BEFORE THE DATE OF SEA RCH, FOR THE ASSESSMENT YEAR 1995-96. THEREFORE, THE PURCHASE O F PROPERTY BY THE ASSESSEES WIFE WAS WITHIN THE KNOWLEDGE OF THE DEPARTMENT BEFORE THE DATE OF SEARCH. NOW THE DEPARTMENT MADE AN ADDITION ON THE BASIS OF THE STATEMENT RECORDED FROM THE ASS ESSEE DURING THE SURVEY OPERATION UNDER SECTION 133A OF THE ACT. ADMITTEDLY, THE REVENUE AUTHORITIES ARE NOT EMPOWERED TO ADMINISTER OATH DURING THE COURSE OF SURVEY OPERATION. THEREFORE, THE STA TEMENT RECORDED DURING THE COURSE OF SURVEY OPERATION CANNOT BE CON SIDERED DURING 20 I.T.(SS) A. NO.20/MDS/2011 C.O. NO.10/MDS/2012 THE COURSE OF BLOCK ASSESSMENT PROCEEDINGS. OTHER T HAN THE STATEMENT RECORDED UNDER SECTION 133A OF THE ACT, N O OTHER MATERIAL WAS AVAILABLE ON RECORD. MOREOVER, THE PU RCHASE OF PROPERTY WAS NOT UNEARTHED DURING THE SEARCH OPERAT ION. IN OTHER WORDS, THE PURCHASE OF PROPERTY DISCLOSED BY THE AS SESSEE BEFORE THE REVENUE AUTHORITIES WAS ALREADY WITHIN THEIR KN OWLEDGE WHEN IT WAS REFLECTED IN RETURN OF INCOME FILED BY THE ASSE SSEES WIFE FOR THE ASSESSMENT YEAR 1995-96. THEREFORE, THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT THE CIT(APPEALS) HAS RIGHTL Y DELETED THE ADDITION. 22. THE NEXT ISSUE ARISES FOR CONSIDERATION IS WITH REGARD TO THE ADDITION OF ` 6,38,080/- IN CHIT. 23. SH. JOE SEBASTIAN, THE LD. DEPARTMENTAL REPRESE NTATIVE, SUBMITTED THAT THE REVENUE AUTHORITIES FOUND THAT T HE ASSESSEES WIFE CONTRIBUTED SUBSCRIPTION TO A CHIT IN M/S SRI RAM CHIT AND M/S SOWDAMBIKA CHITS. THE ASSESSEE DURING EXAMINATION ON 11.12.1997, ADMITTED THAT THIS WAS NOT DECLARED TO THE DEPARTMENT. HOWEVER, ON APPEAL BY THE ASSESSEE, THE CIT(APPEALS ) FOUND THAT THE PAYMENT TO CHIT AND THE AUCTION OF CHIT WERE AL SO DULY REFLECTED IN THE BALANCE SHEET AS ON THE DATE OF SEARCH. THE CIT(APPEALS) FURTHER FOUND THAT CHIT AUCTION WAS SHOWN AS LIABIL ITY IN THE BALANCE 21 I.T.(SS) A. NO.20/MDS/2011 C.O. NO.10/MDS/2012 SHEET. ACCORDINGLY, HE DELETED THE SAME. ACCORDIN G TO THE LD. D.R., THE CIT(APPEALS) OUGHT NOT HAVE DELETED THE A DDITION MADE BY THE ASSESSING OFFICER ON THE BASIS OF THE BALANCE S HEET. 24. ON THE CONTRARY, SHRI S. SRIDHAR, THE LD.COUNSE L FOR THE ASSESSEE, SUBMITTED THAT THE VERY SAME BALANCE SHEE T WAS CONSIDERED BY THE ASSESSING OFFICER TO MAKE THE ADD ITION OF ` 24,50,000/- TOWARDS INVESTMENT IN THE MONEY LENDING BUSINESS. THE ASSESSING OFFICER CONSIDERED THE BALANCE SHEET FOR MAKING ADDITION, HE SHOULD HAVE CONSIDERED THIS FOR INCOME OF THE ASSESSEE WHICH IS AVAILABLE FOR MAKING ADDITION IN INVESTMEN TS. ACCORDING TO THE LD. COUNSEL, THE BALANCE SHEET SHOULD BE CONSID ERED IN TOTO OR REJECTED IN TOTO. SINCE THE ASSESSING OFFICER HIMS ELF ACCEPTED THE BALANCED SHEET FOR MAKING SOME OF THE ADDITIONS, TH E CIT(APPEALS) FOUND THAT THE SAME CANNOT BE REJECTED PARTLY. ACC ORDINGLY, THE CIT(APPEALS) DELETED THE ADDITION. 25. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EIT HER SIDE AND PERUSED THE RELEVANT MATERIAL ON RECORD. THE ASSES SEE ADMITTEDLY INVESTED IN FUNDS IN THE NAME OF HIS WIFE SMT. R. K UMUTHAVALLI AND THE SAME WAS NOT DISCLOSED TO THE DEPARTMENT. T HE INVESTMENT IN CHIT AND THE CHIT AUCTION AMOUNT WERE DISCLOSED IN THE BALANCE SHEET FILED FOR THE BLOCK PERIOD ON THE DATE OF SEA RCH. THE 22 I.T.(SS) A. NO.20/MDS/2011 C.O. NO.10/MDS/2012 ASSESSING OFFICER REJECTED THE CLAIM OF THE ASSESSE E. HOWEVER, THE CIT(APPEALS) FOUND THAT THE BALANCE SHEET AS ON THE DATE OF SEARCH CANNOT BE REJECTED. THE FACT REMAINS THAT FOR MAKI NG ADDITION, THE ASSESSING OFFICER HAS HIMSELF ACCEPTED THE BALANCE SHEET. THEREFORE, THE FUNDS DISCLOSED IN THE BALANCE SHEET HAS TO BE TAKEN IN TOTO. IN OTHER WORDS, THE BALANCE SHEET CANNOT BE REJECTED PARTIALLY AT THE CONVENIENCE OF THE ASSESSING OFFIC ER. THEREFORE, THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT THE CIT(APPEALS) HAS RIGHTLY DELETED THE ADDITION OF ` 6,38,080/-. 26. THE NEXT GROUND OF APPEAL IS WITH REGARD TO ADD ITION OF ` 42,000/- TOWARDS INVESTMENT IN HOUSEHOLD GOODS. 27. SH. JOE SEBASTIAN, THE LD. DEPARTMENTAL REPRESE NTATIVE, SUBMITTED THAT THE REVENUE AUTHORITIES FOUND INVEST MENT OF ` 99,000/- MADE BY THE ASSESSEE IN THE HOUSEHOLD GOODS SUCH AS MOTOR CYCLE, SCOOTY, TV, FRIDGE, TAPE RECORDER, AIR CONDI TIONER, ETC. THE ASSESSEE ADMITTED THAT THE ABOVE ASSETS WERE PURCHA SED OUT OF UNACCOUNTED INCOME ONLY. HOWEVER, DURING THE COURS E OF HEARING BEFORE THE ASSESSING OFFICER, THE ASSESSEE CLAIMED THAT THE SCOOTY WAS ACCOUNTED IN THE RETURN OF INCOME FOR THE ASSES SMENT YEAR 1994-95. THE ASSESSING OFFICER, AFTER VERIFYING TH E CLAIM, DELETED THE COST OF THE SCOOTY. HOWEVER, THE BALANCE OF ` 80,000/- WAS 23 I.T.(SS) A. NO.20/MDS/2011 C.O. NO.10/MDS/2012 TREATED UNACCOUNTED. ON APPEAL BY THE ASSESSEE, TH E CIT(APPEALS) FOUND THAT SOME OF THE CREDITS WERE DISCLOSED IN TH E BALANCE SHEET. THEREFORE, HE RESTRICTED THE SAME TO ` 38,000/- AND ALLOWED THE BALANCE OF ` 42,000/-. ACCORDING TO THE LD. D.R., THE CIT(APPEA LS) OUGHT TO HAVE CONFIRMED THE ENTIRE ADDITION OF ` 80,000/-. 28. ON THE CONTRARY, SHRI S. SRIDHAR, THE LD.COUNSE L FOR THE ASSESSEE, SUBMITTED THAT THE HOUSEHOLD ARTICLES PUR CHASED BY THE ASSESSEE WERE DISCLOSED IN THE BALANCE SHEET TO THE EXTENT OF ` 61,000/-. THE TOTAL COST OF HOUSEHOLD ARTICLES WAS ` 99,000/-. THEREFORE, THE CIT(APPEALS) RESTRICTED THE SAME TO ` 38,000/- WHICH CANNOT BE EXPLAINED BY THE ASSESSEE. HENCE, NO INT ERFERENCE IS CALLED FOR. 29. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EIT HER SIDE AND PERUSED THE RELEVANT MATERIAL ON RECORD. DURING TH E COURSE OF SEARCH OPERATION, THE REVENUE AUTHORITIES FOUND MOT OR CYCLE, SCOOTY, TV, FRIDGE, TAPE RECORDER, AIR CONDITIONER, ETC. THE COST WAS ESTIMATED AT ` 99,000/-. IN THE BALANCE SHEET FILED BEFORE THE ASSESSING OFFICER, THE ASSESSEE EXPLAINED THE INVES TMENT TO THE EXTENT OF ` 61,000/-. AS ALREADY OBSERVED, THE BALANCE SHEET H AS TO BE ACCEPTED IN TOTO OR REJECTED IN TOTO. THEREFORE , THE CIT(APPEALS) ACCEPTING THE DETAILS OF INVESTMENT FOUND IN THE BA LANCE SHEET, 24 I.T.(SS) A. NO.20/MDS/2011 C.O. NO.10/MDS/2012 DELETED THE ADDITION TO THE EXTENT OF ` 42,000/-, HOWEVER, CONFIRMED THE ADDITION OF ` 38,000/-. THEREFORE, THIS TRIBUNAL DO NOT FIND ANY INFIRMITY IN THE ORDER OF THE CIT(APPEALS) AND THE SAME IS CONFIRMED. 30. THE ASSESSEE HAS RAISED ONE MORE GROUND WITH RE GARD TO ADDITION OF ` 15,000/- FOR THE ASSESSMENT YEAR 1991-92 ON THE GROUND THAT THE SAME WAS NOT REFLECTED IN THE ASSES SEES INCOME. ACCORDING TO THE LD. COUNSEL, THE ASSESSEE ADMITTED AN AMOUNT OF ` 1,60,000/- FOR THE ASSESSMENT YEAR 1991-92. HOWEVE R, THE CIT(APPEALS) FOUND THAT AN ADVANCE OF ` 1,60,000/- REPRESENTS MONEY LENDING ADVANCES AND THERE WAS NO MENTION ABO UT RENTAL ADVANCE. THEREFORE, HE CONFIRMED THE ADDITION MADE BY THE ASSESSING OFFICER. ACCORDING TO THE LD. COUNSEL, W HEN THE SAME WAS REFLECTED IN THE RETURN OF INCOME FOR THE ASSES SMENT YEAR 1991- 92, THE CIT(APPEALS) OUGHT TO HAVE DELETED THE ADDI TION. 31. ON THE CONTRARY, THE LD. D.R. SUBMITTED THAT TH E ISSUE IS WITH REGARD TO ADVANCE OF ` 15,000/- TOWARDS RENT. THE ADVANCES MENTIONED IN THE RETURN WERE WITH REGARD TO MONEY L ENDING ADVANCES AND NOT RENTAL ADVANCES. THEREFORE, THE C IT(APPEALS) HAS RIGHTLY CONFIRMED THE ADDITION. 25 I.T.(SS) A. NO.20/MDS/2011 C.O. NO.10/MDS/2012 32. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EIT HER SIDE AND PERUSED THE RELEVANT MATERIAL ON RECORD. ACCORDING TO THE LD. COUNSEL, THE ADVANCE OF ` 1,60,000/- WAS REFLECTED IN THE RETURN OF INCOME FOR THE ASSESSMENT YEAR 1991-92. AFTER GOIN G THROUGH THE RECORDS, THE CIT(APPEALS) FOUND THAT THESE ADVANCES RELATE TO MONEY LENDING ADVANCES AND NOT FOR RENTAL ADVANCE. NO MATERIAL WAS AVAILABLE ON RECORD TO SUGGEST THAT THE ADVANCE OF ` 15,000/- WAS DISCLOSED IN THE RETURN OF INCOME. IN THE ABSE NCE OF MATERIAL, THIS TRIBUNAL DO NOT FIND ANY INFIRMITY IN THE ORDE R OF THE CIT(APPEALS) AND THE SAME IS CONFIRMED. 33. IN THE RESULT, APPEAL OF THE REVENUE IS DISMIS SED AND CROSS OBJECTION OF THE ASSESSEE IS PARTLY ALLOWED. ORDER PRONOUNCED ON 24 TH JULY, 2015 AT CHENNAI. SD/- SD/- (. !'# ! ) ( . . . ) (A. MOHAN ALANKAMONY) (N.R.S. GANESAN) % / ACCOUNTANT MEMBER /JUDICIAL MEMBER /CHENNAI, 4 /DATED, THE 24 TH JULY, 2015. KRI. + -056 7620 /COPY TO: 1 . () / APPELLANT 3. / 80 () / CIT(A) 5. 69 -0 / DR 2. -.() / RESPONDENT 4. / 80 / CIT 6. : ; / GF
