Smt. Seema Mehta, Bhopal V. The ACIT, 3(1), Bhopal

ITSSA 201/IND/2012

• Counselvise Citation: [2013] 121 COUNSELVISE.COM (IT) 9134 (ITAT-INDORE)
• Duration Of Justice: 11 month(s) 9 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 16-04-2013
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: DB
• Assessment Year: 2004-2005
• Appeal Filed On: 07-05-2012
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: MRIDULA BAJPAI
• Assessee Lawyers: YASHWANT SHARMA
• Keywords: Salary income; Additional evidence
• Section: 143(3); 153A; 234B; 147

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL , INDORE BENCH, INDORE BEFORE SHRI JOGINDER SINGH, J.M. AND SHRI R.C.SHARM A, A.M. PAN NO. : ABEPM9681H I.T(SS).A.NOS. 200 TO 205/IND/2012 A.Y S . : 2003 - 04 TO 2008 - 09 SMT.SEEMA MEHTA, BHOPAL ACIT, 3(1), BHOPAL VS APPELLANT RESPONDENT ASSESSEES BY : SHRI YASHWANT SHARMA, ADVOCATE DEPARTMENT BY : SMT. MRIDULA BAJPAI, CIT DR DATE OF HEARING : 25.02.2013 DATE OF PRONOUNCEMENT : 16 . 0 4 .201 3 O R D E R PER R. C. SHARMA, A.M. THESE ARE THE APPEALS FILED BY THE ASSESSEE AGAINST THE ORDER OF CIT(A) DATED 2 ND MARCH, 2012, FOR THE ASSESSMENT YEAR 2003-04 TO 2008-09, IN THE MATTER OF ORDER PASSED U /S 153A READ WITH SECTION 143(3) OF THE INCOME-TAX ACT, 196 1. -: 2: - 2 2. RIVAL CONTENTIONS HAVE BEEN HEARD AND RECORDS PERUSED. FACTS IN BRIEF ARE THAT ON 30.5.2008, SEAR CH AND SEIZURE U/S 132(1) WAS CONDUCTED AT THE RESIDENTIAL PREMISES OF SMT. SEEMA MEHTA AT E-5/1458, ARERA COLONY, BHOP AL. DURING THE COURSE OF SEARCH DOCUMENTS AND INFORMATI ON RELATING TO THE ASSESSEE WERE ALSO FOUND AND SEIZED . AFTER RECORDING REASONS, THE ASSESSING OFFICER ISSUED NOT ICE U/S 153A. IN RESPONSE THE ASSESSEE FILED THE RETURN OF INCOME OF VARIOUS YEARS AS UNDER : ASSESSMENT YEAR RETURNED INCOME A. 2003 - 04 RS. 1,81,569/ - B. 2004 - 05 RS. 1,12,015/ - C. 2005 - 06 RS. 1,14,000/ - D. 2006 - 07 RS. 2,24,908/ - E. 2007 - 08 RS. 5,82,950/ - F. 2008 - 09 RS. 5,27,147/ - 3. WHILE FRAMING ASSESSMENT U/S 153A, THE ASSESSING OFFICER DID NOT ACCEPT AGRICULTURAL INCOME OFFERED BY THE ASSESSEE, ACCORDINGLY, THE SAME WAS TREATED AS INCO ME FROM -: 3: - 3 OTHER SOURCES. ADDITIONS WERE ALSO MADE WITH RESPEC T TO THE CASH FOUND DEPOSITED IN THE BANK ACCOUNT. THE ASSES SING OFFICER ALSO ADDED THE ENTIRE AMOUNT OF CONTRACT RE CEIPT WHICH WAS OFFERED BY THE ASSESSEE AT 8 % OF PRESUMPTIVE S CHEME. 4. WITH RESPECT TO THE AGRICULTURAL INCOME, THE LD. CI T(A) CONFIRMED THE ACTION OF THE ASSESSING OFFICER FOR T REATING THE SAME AS INCOME FROM OTHER SOURCES. THE LD. CIT(A) O BSERVED THAT DURING THE COURSE OF HEARING, THE ASSESSEE SUB MITTED COPIES OF SOME DOCUMENTS, WHICH WERE NOT PRODUCED B EFORE THE ASSESSING OFFICER. THE LD. CIT(A) DID NOT ACCEP T THE ADDITIONAL EVIDENCE AND UPHELD THE ACTION OF ASSESS ING OFFICER. 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND HAVE GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW AN D FOUND FROM RECORD THAT SIMILAR ISSUE HAS BEEN CONSIDERED IN THE CASE OF OTHER GROUP MEMBERS OF THE ASSESSEE, NAMELY HITE SH MEHTA & OTHERS FOR WHICH CONSOLIDATED ORDER WAS PASSED ON 22 ND MARCH, 2013. IT WAS ARGUED BY THE LEARNED AUTHORIZ ED REPRESENTATIVE THAT ADDITIONAL DOCUMENTS SO FILED GO TO THE ROOT ISSUE AND CONTROVERTED THE FINDINGS RECORDED B Y THE -: 4: - 4 ASSESSING OFFICER, HOWEVER, THE CIT(APPEALS) HAS NO T CONSIDERED THE SAME AND DID NOT GIVE OPPORTUNITY TO EXPLAIN THE ADDITIONAL DOCUMENTS SO FILED. OUR ATTENTION W AS ALSO INVITED TO THE AGRICULTURAL INCOME OFFERED BY THE A SSESSEE IN THE ASSESSMENT YEAR 2003-04 AT RS. 4,98,300/-, WHIC H WAS ACCEPTED BY THE DEPARTMENT, IN SCRUTINY ASSESSMENT ORDER, WHEREIN AGRICULTURAL INCOME OF RS. 4,40,640/- WAS A CCEPTED BY THE ASSESSING OFFICER. IN THIS YEAR, AGRICULTURAL I NCOME @ RS.9000/- PER ACRE WAS ACCEPTED BY THE DEPARTMENT. SIMILARLY, FOR ASSESSMENT YEAR 2004-05, AGRICULTURA L INCOME OFFERED AT RS. 5,42,400/- WAS ACCEPTED BY THE DEPAR TMENT. THUS, AGRICULTURAL INCOME @7188/- PER ACRE WAS ACCE PTED UNDER THE SCRUTINY ASSESSMENT FRAMED U/S 143(3). BO TH THESE ASSESSMENT YEARS ARE COVERED IN THE BLOCK PERIOD. T HUS, IT IS EVIDENT THAT THE RETURNS, WHICH WERE FILED MUCH PRI OR TO THE DATE OF SEARCH, THE AGRICULTURAL INCOME SO OFFERED WAS ACCEPTED BY THE DEPARTMENT. BY CONSIDERING ALL THESE FACTS I N THE CASE OF OTHER GROUP ASSESSEE, THE TRIBUNAL HAVE SET-ASID E THE ISSUE TO THE FILE OF THE ASSESSING OFFICER FOR DECIDING A FRESH AFTER CONSIDERING THE ADDITIONAL EVIDENCE SO FILED BY THE ASSESSEE -: 5: - 5 BEFORE THE CIT(A). THE PRECISE OBSERVATION OF THE T RIBUNAL IN ITS ORDER DATED 22 ND MARCH, 2013, READS AS UNDER :- 7. RIVAL CONTENTIONS HAVE BEEN HEARD AND RECORDS PERUSED. WE HAD ALSO GONE THROUGH THE ADDITIONAL DOCUMENTS FILED BEFORE THE CIT(A) UNDER RULE 46A. 8. WITH REGARD TO AGRICULTURAL INCOME DECLARED BY THE ASSESSEE, THE OBSERVATION OF THE ASSESSING OFFICER FOR DECLINE OF ASSESSEES CONTENTION REGARD ING AGRICULTURAL INCOME WAS THAT THE ASSESSEE HAD NOT SHOWN AGRICULTURAL INCOME UP TO ASSESSMENT YEAR 2000-01. THAT ASSESSEE WAS MAINLY IN THE BUSINESS AND ALSO HAVING SALARY INCOME, THEREFORE, IT IS UNLIKELY TO HAVE TIME FOR AGRICULTURAL OPERATION. T HE ASSESSING OFFICER DECLINED THE CLAIM ALSO BY OBSERVING THAT ONLY PHOTOCOPY OF LEASE AGREEMENTS WERE FILED AND NOT THE ORIGINAL LEASE AGREEMENTS. THE THRUST OF ASSESSING OFFICER FOR DECLINING THE ASSESSEES CLAIM WAS ALSO BASED ON THE SURRENDER OF AGRICULTURAL INCOME MADE BY THREE GROUP COMPANIES IN THE ASSESSMENT YEAR 2005-06, -: 6: - 6 NAMELY, RAJ HOMES PRIVATE LIMITED, MINAL BUILDERS AND RAJ EVENT AND ENTERTAINMENT PRIVATE LIMITED. THE ASSESSING OFFICER OBSERVED THAT THESE COMPANIES HAVE SURRENDERED AGRICULTURAL INCOME IN THE ASSESSMENT YEAR 2005-06, THEREFORE, CLAIM OF OTHER ASSESSEES BELONGING TO SAME GROUP WITH RESPECT TO THE SAME NATURE OF INCOME CANNOT BE ACCEPTED. THE ASSESSING OFFICER ALSO OBSERVED THAT SOME FARMERS, WERE CROSS EXAMINED BY COUNSEL OF RAJ GROUP OF INDUSTRIES DURING PENALTY PROCEEDINGS U/S 271(1)(C), WHEREIN THEY HAVE DENIED HAVING ANY LAND GIVEN ON LEASE. THE ASSESSING OFFICER STATED THAT PHOTOCOPY OF KHASRA, KHATAUNI AND FORM P-II WERE FILED AND THE ASSESSEE DID NOT PRODUCE ORIGINA L OF THESE CERTIFICATES, HENCE AUTHENTICITY OF THESE DOCUMENTS WERE DOUBTFUL. THE ASSESSING OFFICER ALSO STATED THAT BILLS OF EXPENDITURE LIKE SEEDS, FERTILIZERS, PESTICIDES, LABOUR AND OTHER RELATED DETAILS LIKE TRANSPORTATION WAREHOUSE ETC. WERE NOT FILED. WE FOUND THAT THE CIT(A) BROADLY CONFIRMED T HE -: 7: - 7 OBSERVATION OF THE ASSESSING OFFICER. TO OVERCOME THE FINDINGS OF ASSESSING OFFICER, THE ASSESSEE HAS FILED DOCUMENTS UNDER RULE 46A BEFORE THE CIT(A), BUT HE DECLINED TO ACCEPT THE SAME ON THE PLEA THAT DESPITE OPPORTUNITY, THE ASSESSEE DID NOT PRODUCE THESE DOCUMENTS BEFORE THE ASSESSING OFFICER. THE CIT(A) FURTHER OBSERVED THAT DURING THE ASSESSMENT YEAR 2008-09 VERY NOMINAL AGRICULTURAL INCOME WAS SHOWN, THEREFORE, THE ASSESSEES CLAIM OF AGRICULTURAL INCOME IN EARLIER YEARS CANNOT BE ACCEPTED. IT WAS ALSO OBSERVED BY CIT(A) THAT ALL T HE DIRECTORS IN BUSINESS RESIDE IN BHOPAL, WHILE AGRICULTURAL LAND WAS SITUATED AT A DISTANT AREA. 9. AFTER GOING THROUGH THE REASONING GIVEN BY THE ASSESSING OFFICER AND CIT(A) FOR DECLINE OF DEDUCTI ON AND AFTER VERIFYING THE ADDITIONAL EVIDENCE FILED BEFORE THE CIT(A) UNDER RULE 46A, WE FOUND THAT THE ASSESSEE HAS FILED ORIGINAL LEASE AGREEMENTS BEFORE THE CIT(A). ONE OF THE REASONS GIVEN BY THE ASSESSING OFFICER FOR DECLINE WAS THAT ORIGINAL LEA SE -: 8: - 8 AGREEMENT WAS NOT PRODUCED. IT WAS SUBMITTED BY THE ASSESSEE THAT DUE TO CHANGE IN OFFICE ADDRESS, THE ORIGINAL LEASE AGREEMENTS WERE NOT TRACEABLE DURING THE RELEVANT POINT OF TIME, THEREFORE, THEY WERE FILED BEFORE THE CIT(A). THE OTHER REASON GIVE N BY THE ASSESSING OFFICER WAS THAT ORIGINAL KHASRA, KHATAUNI AND FORM P-II WAS NOT FILED, THEREFORE, CLAIM OF AGRICULTURAL INCOME CANNOT BE ACCEPTED. BEFORE THE CIT(A), THE ASSESSEE HAS FILED ORIGINAL KHASRA, KHATAUNI AND FORM NO. P-II TO SUBSTANTIATE ITS CLAIM OF AGRICULTURAL INCOME BUT THE SAME WERE NOT ACCEPTED. BEFORE THE CIT(A), THE ASSESSEE HAS FILED ORIGINAL KHASRA, KHATAUNI AND FORM P-II TO SUBSTANTIATE ITS CLAIM OF AGRICULTURAL INCOME AND SAME ARE PLACED AT PAGE 230 TO 457 OF THE PAPER BOOK. THE ASSESSEE HAS ALSO FILED ORIGINAL RECEIPTS OF PAYMENT OF LEASE RENT, WHICH ARE PLACED AT PAGE 230 TO, 457 OF THE PAPER BOOK. WE FOUND THAT ASSESSEE WAS PREVENTED BY SUFFICIENT CAUSE FOR NOT SUBMITTIN G THE SAME BEFORE ASSESSING OFFICER, SINCE THESE -: 9: - 9 DOCUMENTS WERE MISPLACED DUE TO SHIFTING OF OFFICE. IF ASSESSEE COULD FILE PHOTOCOPY BEFORE THE ASSESSING OFFICER, HE COULD FILE ORIGINAL ALSO, AS FILED BEFORE THE CIT(A). THE ASSESSEE BY NOT FILING THESE DOCUMENTS BEFORE THE ASSESSING OFFICER CANNOT SPOIL HIS CASE. SINCE THESE DOCUMENTS WERE NECESSARY TO DETERMINE THE CORRECT NATURE OF INCOME HAVING BEEN OFFERED BY THE ASSESSEE, THE CIT(A) WAS NOT JUSTIFI ED IN NOT ACCEPTING THESE DOCUMENTS WHICH GOES TO THE ROOT OF THE ISSUE. AFTER ACCEPTING THE DOCUMENTS FI LED UNDER RULE 46A, THE CIT(A) COULD HAVE CALLED FOR REMAND REPORT FROM THE ASSESSING OFFICER AND AFTER CONSIDERING THE SAME HE SHOULD HAVE ARRIVED AT CORRECT CONCLUSION WITH REGARD TO THE NATURE OF INCOME OFFERED BY THE ASSESSEE. AS PER RECORD, THE CLAIM OF ASSESSEE WAS THAT THE AGRICULTURAL OPERATION OF THE ASSESSEE WAS BEING LOOKED AFTER BY AJAB SINGH, WHO WAS EMPLOYED BY THE ASSESSEE. INSPITE OF MAKING REQUEST TO ASSESSING OFFICER AND CIT(A), THE NONE OF THE AUTHORITIES HAVE CALLED AJA B -: 10: - 10 SINGH TO VERIFY THE WORK UNDERTAKEN BY HIM AND CORRECTNESS OF AGRICULTURAL INCOME HAVING BEEN EARNED BY THE ASSESSEE. WE ALSO FOUND THAT CONCLUSION OF ASSESSING OFFICER WAS MORE INFLUENCED BY THE SURRENDER OF AGRICULTURAL INCOME BY THREE GROUP COMPANIES. THROUGH THE DOCUMENTS PLACED ON RECORD, IT WAS CLARIFIED BY THE ASSESSEE THAT FARME RS, WHO HAVE DECLINED TO GIVE LOAN TO THE ASSESSEE WERE OF DIFFERENT VILLAGER AND THE LAND WAS ALSO SITUATE D AT DIFFERENT LOCATION. AS THE FARMERS FROM WHOM LAN D WAS TAKEN BY THE ASSESSEE WAS DIFFERENT FROM FARMERS, WHO HAVE GIVEN LAND TO THE THREE COMPANIES, WHICH HAVE SURRENDERED THEIR CLAIM OF AGRICULTURAL INCOME, THEREFORE, NO FRUITFUL PURPOSE WAS SERVE BY RELYING ON THE STATEMENT OF THOSE FARMERS, WHO HAD GIVEN LAND TO THESE THREE COMPANIES AND NOT THE ASSESSEE BEFORE US. WE FOUND THAT IN THE ASSESSMENT YEAR 2005-06, THREE GROUP COMPANIES HAD SURRENDERED THEIR AGRICULTURAL INCOME, BECAUSE FARMERS OF THOSE COMPANIES HAD -: 11: - 11 GIVEN ADVERSE STATEMENT TO THE EFFECT THAT THEY HAD NOT GIVEN LAND TO THE COMPANIES AND DO NOT KNOW THEIR DIRECTORS. AS PER LD.AUTHORIZED REPRESENTATIV E, THESE FARMERS BECAME HOSTILE AND WERE MISLED UNDER INTIMIDATION. WE FOUND THAT THE ASSESSEE HAVE ALREADY DECLARED AGRICULTURAL INCOME MUCH PRIOR TO THE SEARCH RIGHT FROM ASSESSMENT YEAR 2001 - 02. IN THE ASSESSMENT YEAR 2003-04 AND 2004-005, THERE WAS SCRUTINY ASSESSMENT ORDER, WHEREIN AGRICULTURAL INCOME OF RS. 4,99,400/- DURING THE ASSESSMENT YEAR 2003-04 WAS ACCEPTED BY THE ASSESSING OFFICER AT RS. 4,70,790/-. SIMILARLY, IN THE ASSESSMENT YEAR 2004-05, THE ASSESSEES CASE WAS DECIDED U/S 143(3) AND AGRICULTURAL INCOME OF RS. 8,52,569/- WAS ACCEPTED AT RS. 8,20,530/-. THUS, IN BOTH THE SCRUTINY ASSESSMENTS KEEPING IN VIEW THE LAND TAKEN ON LEASE, AGRICULTURAL INCOME AT RS. 9000/- PER ACRE WAS ACCEPTED BY THE ASSESSING OFFICER. WHEN IN THE SCRUTINY ASSESSMENT, THE INCOME HAS BEEN ACCEPTED, WITHOUT GIVING COGENT -: 12: - 12 REASONING, THE SAME CANNOT BE DECLINED. SINCE ORIGINAL AND XEROX COPY OF LEASE AGREEMENTS ARE SAME, NO REASON FOR ASSESSEE NOT TO SUBMIT ORIGINAL BEFORE THE ASSESSING OFFICER, IF HE COULD SUBMIT IT BEFORE CIT(A). SIMILAR IS THE POSITION WITH REGARD TO KHASRA, KHATAUNI AND FORM P-II. EVEN IN ABSENCE OF ORIGINAL LEASE AGREEMENT AND KHASRA KHATAUNI, THE ASSESSING OFFICER COULD MAKE INQUIRY EVEN ON PHOTOCOPY. THE ASSESSEE HAD FURNISHED ADDRESSES OF ALL THE FARMERS, THE FARMERS IN THE AGREEMENT AR E RESIDENTS OF VILLAGE AND FULL ADDRESS WAS GIVEN. MANY SUMMONS WERE SERVED AS PER THE OBSERVATION OF THE ASSESSING OFFICER HIMSELF, BUT NO EFFECTIVE EFFORTS WERE MADE TO ENSURE ABOUT THE FARMERS PRESENCE. EVEN A REQUEST WAS FILED BY THE ASSESSEE BEFORE THE ASSESSING OFFICER TO SUMMON FARMERS U/S 131. THE ASSESSEE HAS ALSO REQUESTED THE ASSESSING OFFICER TO SUMMON MR.AJAB SINGH RAGHUVANSHI WHO WAS TAKING CARE OF ASSESSEES AGRICULTURAL ACTIVITY AND ITS SALES REALIZATION ETC. HOWEVER, MR. AJAB -: 13: - 13 SINGH WAS NOT CALLED FOR. COPY OF KHASRA ISSUED BY PATWARI CONFIRMING THE PRODUCTION OF CROP WAS FILED BEFORE THE ASSESSING OFFICER WHICH HAS NOT BEEN DISPROVED BY HIM. IT WAS ALSO CONTENTION OF LD. AUTHORIZED REPRESENTATIVE THAT STATEMENT OF MANDI PERSONS WHICH WERE RECORDED BEHIND THE BACK OF THE ASSESSEE, HENCE CANNOT BE USED AGAINST HIM, AS THE SAME WERE NOT CONFRONTED TO HIM. FOR THIS PURPOSE RELIANCE WAS PLACED ON THE DECISION OF HON'BLE SUPREME COURT IN THE CASE KISHAN CHAND CHELARAM, 125 ITR 713. LD. AUTHORIZED REPRESENTATIVE ALSO CLARIFIED THAT THERE IS NO PRACTICE OF MENTIONING NAMES OF BATAIDAR/LESSEE ON THE KHASRA, KHATAUNI AND FORM P-II, BECAUSE THIS AT TIMES HAS GIVEN RISE TO PLETHORA OF CIVIL SUITS BEING FILED BY THE BATAIDAR/LESSEE FOR OWNERSHIP OF LAND DUE TO CULTIVATION DONE BY THEM FOR LONGER PERIOD. HENCE, NOT MENTIONING THE NAME OF LESSEE, BATAIDAR IN KHASRA , KHATAUNI AND FORM NO. P-II CANNOT BE VIEWED AGAINST THE ASSESSEE. THUS, THE OBSERVATION -: 14: - 14 OF ASSESSING OFFICER IN THIS REGARD DO NOT CARRY MU CH FORCE. HE FURTHER SUBMITTED THAT IT WAS DULY STATED BEFORE THE ASSESSING OFFICER THAT ENTIRE AGRICULTUR AL OPERATION ON THE LAND WERE DONE BY MR. AJAB SINGH RAGHUVANSHI, BAZAR MOHALLA, VILLAGE DEORI, TAHSIL UDAIPUR, DISTT. RAISEN. MR. AJAB SINGH WAS GIVEN IMPREST AND HE USED TO PAY SALE PROCEEDS TO THE ASSESSEE. AS THE ENTIRE WORK WAS BEING TAKEN CARE OF BY AJAB SINGH RAGHVANSHI, THE ASSESSEE DID NOT KNOW THE PURCHASER OF THE CROP. THE INTERMEDIARY SOLD THE CROP AND GAVE MONEY AND MANDI RECEIPTS TO ASSESSEE, THEREFORE, AS PER LD. AUTHORIZED REPRESENTATIVE , THERE WAS NO REASON FOR ASSESSEE T O DOUBT THE MANDI RECEIPTS GIVEN BY HIM. 10. IN VIEW OF THE ABOVE DISCUSSION, WE RESTORE THE MATTER OF AGRICULTURAL INCOME IN ALL THE YEARS UNDE R CONSIDERATION TO THE FILE OF ASSESSING OFFICER FOR DECIDING AFRESH AFTER CONSIDERING THE DOCUMENTS FILED BEFORE CIT(A) UNDER RULE 46A, WHICH GOES TO THE ROOT OF THE ISSUE. WE DIRECT ACCORDINGLY. -: 15: - 15 6. THE ASSESSEE HAS ALSO TAKEN LEGAL GROUND WITH REGAR D TO FRAMING OF ASSESSMENT U/S 153A ON THE PLEA THAT NO INCRIMINATING DOCUMENTS WERE FOUND. 7. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND FOUND FROM RECORD THAT DURING THE COURSE OF SEARCH EVIDEN CE OF CASH DEPOSIT MADE IN THE BANK ACCOUNT WERE FOUND. THUS, THE NOTICE U/S 153A WAS VALIDLY ISSUED AND ASSESSMENT W AS ALSO COMPLETED WITHIN THE TIME ALLOWED IN LAW. ACCORDING LY, WE DO NOT FIND ANY INFIRMITY IN THE ORDER PASSED BY THE A SSESSING OFFICER U/S 153A. 8. WITH REGARD TO ADDITION MADE ON ACCOUNT OF CASH DEPOSITED IN BANK ACCOUNT, THE LD. CIT(A) CONFIRMED THE PART ADDITION IN THE ASSESSMENT YEAR 2004-05 AND 2008-09 AND DELETED THE ADDITION MADE IN RESPECT OF OTHER YEARS BY OBSERVING THAT AGRICULTURAL INCOME AND CONTRACT REC EIPTS WERE AVAILABLE TO THE ASSESSEE AND THE SAME WERE UTILIZE D FOR DEPOSIT IN THE BANK ACCOUNT. HOWEVER, THE REVENUE IS NOT IN APPEAL BEFORE US IN RESPECT OF THE YEARS IN WHICH ADDITION S MADE ON ACCOUNT OF DEPOSIT OF CASH IN THE BANK ACCOUNT WAS DELETED BY CIT(A). PRECISE OBSERVATION OF THE CIT(A) WAS AS UN DER :- -: 16: - 16 7.4 I HAVE EXAMINED THE MATTER. THE ADDITIONAL EVIDENCES SUBMITTED BEFORE ME ARE NOT CONSIDERED FO R DECIDING THE ISSUE DUE TO THE REASON GIVEN ABOVE. T HE FATS OF THE CASH DEPOSIT MADE IN VARIOUS BANK ACCOU NTS WERE DISCOVERED DURING THE COURSE OF SEARCH HENCE T HE APPELLANTS PLEA THAT THE IMPUGNED ADDITION IS NOT BASED ON ANY MATERIAL FOUND DURING THE COURSE OF SEARCH IS NOT VALID. DURING THE HEARING I HAVE EXAM INED THE SOURCE OF ALL DEPOSITS BOTH ABOVE RS. 50000/- A ND BELOW RS. 50000/-. BEFORE THE ASSESSING OFFICER, TH E APPELLANT HAS CLAIMED THAT THE CASH DEPOSITS MADE I N THESE BANK ACCOUNTS WERE OUT OF AGRICULTURE INCOME AND CONTRACT RECEIPT. IN THIS APPEAL ORDER THE ADDITION S ON ACCOUNT OF AGRICULTURE INCOME AND CONTRACT RECEIPT HAVE BEEN CONFIRMED. IT IS NOT FOUND THAT THE CASH AVAIL ABLE OUT OF UNDISCLOSED INCOME WAS INVESTED ELSEWHERE. I N THE APPELLANTS CASE THE RATIO LAID IN ACIT VS. KULW ANT SINGH AND OTHERS, I.T(SS).A.NOS. 57 TO 63/IND/2008 (INDORE I.T.A.T. ) IS DIRECTLY APPLICABLE. THE UNAC COUNTED INCOME CLAIMED AS AGRICULTURE INCOME AND CONTRACT -: 17: - 17 RECEIPT HAVE BEEN BROUGHT TO TAX HENCE TAXING THE C ASH DEPOSITED IN THE BANK TO THE EXTENT OF AVAILABILITY OF CASH ON ACCOUNT OF ADDITIONS CONFIRMED WILL AMOUNT TO DOUBLE ADDITION. IN VIEW OF THE ABOVE, IT IS HELD T HAT THE ADDITION MADE ON ACCOUNT OF CASH DEPOSITS MADE IN BANK ACCOUNT IS TO BE REDUCED BY THE ADDITIONS CONFIRMED ON ACCOUNT OF CLAIM OF AGRICULTURE INCOME AND CONTRACT RECEIPT AND THAT THE SOURCE OF BALANCE AMO UNT DEPOSITED IN BANK IS NOT EXPLAINED. THE AMOUNT OF ADDITION REDUCED FOR VARIOUS YEARS IS AS UNDER :- ASSESSMENT YEAR AMOUNT OF ADDITION CONFIRMED ON ACCOUNT OF AGRICULTURE INCOME AND CONTRACT RECEIPT ADDITION ON ACCOUNT OF CASH DEPOSIT AMOUNT OF CONFIRMED ADDITION ON ACCOUNT OF CASH DEPOSIT IN BANK 2003-04 4,98,300 2,95,000 NIL 2004-05 5,42,400 7,30,000 1,87,600 2005-06 4,51,456+80,000 3,11,000 NIL 2006-07 5,87,174+1,00,000 5,50,000 NIL 2007-08 8,97,200 4,85,000 NIL 2008-09 63,462 6,50,221 5,86,759 IN VIEW OF THE ABOVE, THE ADDITION MADE FOR ASSESS MENT YEAR 2003-04, 2005-06, 2006-07, 2007-08 ARE DELETED AND ADDITION FOR ASSESSMENT YEAR 2004-05 IS REDUCED -: 18: - 18 TO RS. 1,87,500/- AND ADDITION FOR ASSESSMENT YEAR 2008-09 IS REDUCED TO RS. 5,86,759/-. IN RESPECT OF ADDITION OF RS. 6,50,221/- IN ASSESSMENT YEAR 2009- 10 IT IS FOUND THAT IN HIS ORDER THE ASSESSING OFFICER HAS NOT GIVEN ANY FINDING REGARDING CASH DEPOSITS IN PREVIOUS YEAR RELEVANT TO ASSESSMENT YEAR 2009-10. IT APPEARS THAT THE ADDITION HAS BEEN INADVERTENTLY MA DE IN THE COMPUTATION. HENCE, THE ADDITION OF RS. 6,50,221/- FOR ASSESSMENT YEAR 2009-10 IS DELETED. . 9. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND FOUND FROM RECORD THAT IN EACH YEAR THE ASSESSEE HAS FILE D CASH FLOW STATEMENT BEFORE THE ASSESSING OFFICER INDICATING A VAILABILITY OF CASH PRIOR TO DEPOSIT IN THE BANK ACCOUNT. IF WE MO DIFY THE CHART GIVEN BY THE LD.CIT(A) AT PAGE 46 TO ASCERTAI N THE OPENING CASH BALANCE IN EACH YEAR, WE FOUND THAT TH ERE WAS SUFFICIENT CASH AVAILABLE WITH THE ASSESSEE OUT OF AGRICULTURAL INCOME AND CONTRACT RECEIPT TO SUBSTANTIATE THE AMO UNT DEPOSITED IN THE BANK ACCOUNT IN THE RESPECTIVE YEA RS. THE -: 19: - 19 CUMULATIVE BALANCE OF CASH AVAILABLE WITH THE ASSES SEE VIS-- VIS CASH DEPOSIT IN THE BANK IN EACH YEAR IS AS UND ER :- ASSESSMENT YEAR AMOUNT OF ADDITION CONFIRMED ON ACCOUNT OF AGRICULTURE INCOME AND CONTRACT RECEIPT CUMULATIVE BALANCE OF CASH AVAILABLE WITH ASSESSEE ADDITION ON ACCOUNT OF CASH DEPOSIT CUMULATIVE BALANCE OF CASH DEPOSITED BY ASSESSEE BALANCE OF EXCESS CASH AVAILABLE IN EACH YEAR 2003-04 4,98,300 4,98,300 2,95,000 2,95,000 2,03,300 2004-05 5,42,400 10,40,000 7,30,000 10,25,000 15,000 2005-06 4,51,456+80,000 15,72,156 3,11,000 13,36,0000 2,36,156 2006-07 5,87,174+1,00,000 22,59,330 5,50,000 18,86,000 3,73,330 2007-08 8,97,200 31,56,530 4,85,000 23,71,000 7,85,530 2008-09 63,462 32,19,992 6,50,221 30,21,221 1,98,771 10. IT IS CLEAR FROM THE ABOVE THAT EVEN TOTAL OF AMOUN T OFFERED BY THE ASSESSEE UNDER THE HEAD OF AGRICULT URAL INCOME AND CONTRACT RECEIPT, WORKS OUT TO RS. 32 ,19,992/- AGAINST WHICH TOTAL CASH DEPOSIT IN THE BANK WORKS OUT TO RS. 30,21,221/-. EVEN IN EACH YEAR, THERE WAS CREDIT BA LANCE OF CASH. IN THE ASSESSMENT YEAR 2004-05, CUMULATIVE CA SH BALANCE AVAILABLE WITH ASSESSEE WAS RS. 10,40,700/- , OUT OF WHICH ASSESSEE HAS DEPOSITED IN THE BANK A CUMULATI VE SUM OF RS. 10,25,000/-. SIMILARLY, OPENING BALANCE IN THE ASSESSMENT YEAR 2008-09 WAS RS. 32,19,992/- OUT OF WHICH TOTAL AMOUNT DEPOSITED UP TILL 2008-09 WAS RS.30,21,221/-. SIN CE SUFFICIENT CASH WAS AVAILABLE WITH THE ASSESSEE, TH ERE IS S NO -: 20: - 20 JUSTIFICATION FOR THE ADDITION SUSTAINED BY THE LD. CIT(A) IN THE ASSESSMENT YEARS 2004-05 AND 2008-09. ACCORDINGLY, THE ASSESSING OFFICER IS DIRECTED TO DELETE THE ADDITIO N IN BOTH THE YEARS. 11. IN THE ASSESSMENT YEARS 2005-06 AND 2006-07, THE ASSESSEE IS AGGRIEVED FOR TAXING ENTIRE CONTRACT RE CEIPT AS ASSESSEES INCOME IN PLACE OF TAXING 8 % OF THE CON TRACT RECEIPT. 12. RIVAL CONTENTIONS HAVE BEEN HEARD AND RECORDS PERUSED. THE FACTS IN BRIEF ARE THAT DURING THE PR EVIOUS YEAR RELEVANT TO ASSESSMENT YEAR 2005-06, THE ASSESSEE H AS DEPOSITED RS. 80,000/- IN BANK ACCOUNT AND IN ASSES SMENT YEAR 2006-07 AT RS. 1 LAKH. IT WAS CLAIMED THAT PRO FIT ON SUCH CONTRACT RECEIPT WAS 8 %, HOWEVER, THE ASSESSING OF FICER HELD THAT THERE WAS NO EVIDENCE TO PROVE THAT AMOUNT DEP OSITED IN THE BANK WAS CONTRACT RECEIPT. NOTHING WAS FILED BE FORE US TO PERSUADE US TO DEVIATE FROM THE FINDINGS RECORDED B Y THE LOWER AUTHORITIES TO THE EFFECT THAT THE AMOUNT SO RECEIV ED BY THE ASSESSEE WAS NOT ON ACCOUNT OF CONTRACT EXECUTED BY THE ASSESSEE IN WHICH SHE HAS EARNED ONLY 8 % OF PROFIT . IN THE -: 21: - 21 ABSENCE OF ANY DOCUMENTARY EVIDENCE FILED BEFORE TH E LOWER AUTHORITIES, WE CONFIRM THE ACTION OF CIT(A) FOR HO LDING THAT ENTIRE AMOUNT OF CONTRACT RECEIPT WAS ASSESSEES IN COME. ACCORDINGLY, THE GROUND RAISED BY THE ASSESSEE IN B OTH THE YEARS ARE DISMISSED. 13. COMMON GROUNDS HAVE TAKEN BY THE ASSESSEE WITH REGARD TO LEVY OF INTEREST U/S 234B. THIS ISSUE HAS BEEN DECIDED BY THE TRIBUNAL IN THE CASE OF OTHER GROUP MEMBERS OF THE ASSESSEE VIDE ITS ORDER DATED 22.03.2013 IN THE CASE OF HITESH MEHTA AND OTHERS, WHEREIN THE TRIBUNAL OBSER VED AS UNDER : 74. A COMMON GROUND HAS BEEN TAKEN REGARDING CHARGING OF INTEREST U/S 234B IN CASE OF ALL THE AFORESAID ASSESSEES IN ALL THE YEARS UNDER CONSIDERATION. 75. PLEA OF LD. AUTHORIZED REPRESENTATIVE WAS THAT IN VIEW OF THE DECISION OF I.T.A.T. MUMBAI BENCH IN THE CASE OF DATAMATICS LIMITED VS. ACIT, (2008) 299 ITR 286 (A.T.) (MUM. I.T.A.T.), WHERE THERE WAS NO DEFA ULT ON THE PART OF THE ASSESSEE IN PAYMENT OF ADVANCE T AX, NO INTEREST WAS LIABLE U/S 234B IN REGULAR -: 22: - 22 ASSESSMENT. FOLLOWING WAS THE PRECISE OBSERVATION O F THE BENCH :- THE CHARGING OF INTEREST U/S 234B IS MANDATORY. MANDATORY DOES NOT MEAN THAT IT IS MANDATORY UNDER ALL CIRCUMSTANCES. IT IS MANDATORY WHEN THE CONDITIONS ARE FULFILLED. THE CONDITION IS THAT THE ASSESSEE SHOULD HAVE DEFAULTED. A READING OF SECTIO N 234B(3) MAKES IT CLEAR THAT WHERE, AS A RESULT OF A N ORDER OF ORDER OF REASSESSMENT OR RE-COMPUTATION U/ S 147 OR SECTION 153A, THE AMOUNT ON WHICH INTEREST WAS PAYABLE UNDER SUB SECTION (1) IS INCREASED, THE ASSESSEE SHALL BE LIABLE TO PAY SIMPLE INTEREST AT THE RATE OF ONE PERCENT. THE SECTION FURTHER MAKES IT C LEAR THAT FIRST OF ALL THERE SHOULD BE A DEFAULT ON THE PART OF THE ASSESSEE IN THE REGULAR ASSESSMENT AND THE ASSESSEE SHOULD HAVE BEEN HELD LIABLE TO PAY INTERE ST U/S 234B. IN THAT CASE, IF THERE WAS REASSESSMENT O R RE-COMPUTATION U/S 147 OR 153A, THE LIABILITY OF TH E ASSESSEE IS INCREASED AND NOT OTHERWISE. IN THE INSTANT CASE, THERE WAS NO DEFAULT ON THE PART OF T HE -: 23: - 23 ASSESSEE, IN PAYING THE ADVANCE TAX. FOR THE FIRST TIME, THE DISPUTE AROSE CONSEQUENT TO THE REASSESSMENT DONE U/S 143(3) READ WITH SECTION 147, INTEREST COULD NOT BE CHARGED U/S 234B. 76. IT WAS FURTHER ARGUED THAT IN VIEW OF THE DECISION OF KERALA HIGH COURT IN THE CASE OF B.LAKSHMIKANTHAN , (2011) 198 TAXMAN 485, INTEREST SHOULD BE CHARGED ON INCREMENTAL INCOME ONLY I.E., ADDITIONAL INCOME ASSESSED U/S 153A AS COMPARED TO THE INCOME DETERMINED U/S 143(1)/143(3). 77. WE HAVE CONSIDERED THE RIVAL CONTENTIONS. IN VIEW OF DECISION OF KERALA HIGH COURT IN THE CASE O F LAKSHMIKANTHAN (SUPRA), WE DIRECT THE ASSESSING OFFICER TO RECOMPUTE THE INTEREST U/S 234B WHICH PROVIDES THAT WHERE ORIGINAL ASSESSMENT COMPLETED U /S 143 IS REVISED EITHER U/S 147 OR U/S 153A, THEN INT EREST FOR NON-PAYMENT OR SHORT PAYMENT OF ADVANCE TAX IS PAYABLE ONLY FOR THE PERIOD MENTIONED IN SECTION 234B(3) WHICH PROVIDES FOR INTEREST FROM THE DATE O F -: 24: - 24 COMPLETION OF REGULAR ASSESSMENT U/S 143(1) TILL TH E DATE OF COMPLETION OF REASSESSMENT. THE ASSESSING OFFICER IS DIRECTED ACCORDINGLY. 78. A COMMON ISSUE HAS BEEN TAKEN IN THE CASE OF ALL THE ASSESSEES TO ALLEGE THAT ASSESSMENTS FRAMED IN INDIVIDUAL CAPACITY WAS NOT JUSTIFIED. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND FOUND FROM REC ORD THAT A WARRANT WAS ISSUED AUTHORIZING SEARCH IN CAS E OF ALL THE INDIVIDUALS. NEITHER ANY AOP WAS EXISTIN G NOR ANY WARRANT WAS ISSUED IN THE NAME OF AOP, THEREFOR E, NO SEARCH WAS POSSIBLE IN THE CASE OF AOP, WHICH DI D NOT EXIST. SINCE THE WARRANT HAVE BEEN ISSUED IN TH E INDIVIDUAL CASES, THE ASSESSMENTS HAVE BEEN PROPERL Y DONE IN THE CAPACITY OF INDIVIDUALS. ACCORDINGLY, W E DO NOT FIND ANY INFIRMITY IN THE ORDER OF ASSESSING OF FICER FOR MAKING ASSESSMENTS IN INDIVIDUAL CAPACITY RATHE R THAN IN CAPACITY OF AOP. IN THE RESULT, GROUND TAKE N BY ALL THE ASSESSEES IN ALL THE YEARS UNDER CONSIDERAT ION ARE DISMISSED. -: 25: - 25 14. THUS, BOTH THE ISSUES ARE SQUARELY COVERED BY THE ABOVE DECISION OF THE TRIBUNAL. RESPECTFULLY FOLLOW ING THE SAME MATTER WITH REGARD TO COMPUTATION OF INTEREST U/S 2 34B IS RESTORED TO THE FILE OF ASSESSING OFFICER WITH THE SAME DIRECTION AS CONTAINED IN ORDER DATED 22.3.2013. HOWEVER, ASS ESSEES GROUND IN ALL THE YEARS UNDER CONSIDERATION WITH RE GARD TO FRAMING ASSESSMENT IN CAPACITY OF AOP IS DISMISSED. 15. IN THE RESULT, THE APPEALS OF THE ASSESSEE ARE ALLO WED IN PART IN TERMS INDICATED HEREIN ABOVE. THIS ORDER HAS BEEN PRONOUNCED IN THE OPEN COURT ON 16 TH APRIL, 2013. SD/- SD/- (JOGINDER SINGH) (R. C. SHARMA) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED : 16 TH APRIL, 2013. CPU* 12164