HareshBhai Ashumalbhai, V. DCIT, Central Circle-3,

ITSSA 209/DEL/2005

• Counselvise Citation: [2016] 122 COUNSELVISE.COM (IT) 1697 (ITAT-DELHI)
• Duration Of Justice: 10 year(s) 10 month(s) 7 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 04-03-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: G
• Next Hearing Date: 11-09-2015
• Assessment Year: misc
• Appeal Filed On: 27-04-2005
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: KARTAR SINGH
• Keywords: Unexplained investment; Unexplained expenditure; Gift; Search and seizure; Valuation report; Block assessment
• Section: 148; 132; 11

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH G, NEW DELHI BEFORE SHRI J.SUDHAKAR REDDY, ACCOUNTANT MEMBER AND SHRI SUDHANSHU SRIVASTAVA, JUDICIAL MEMBER IT(SS)A NO. 209/DEL/2005 BLOCK PERIOD FROM A.Y . 1997-98 TO 2003-04 SHRI HARESHBHAI ASHUMALBHAI KESWANI, VS DCIT, C/O M/S VIJAY STORES, CENTRAL CIRCLE 3, SIDDARTH ROAD, NEW DELHI. BARODA. IT(SS)A NO. 210/DEL/2005 BLOCK PERIOD FROM A.Y . 1997-98 TO 2003-04 SH. VIJAY KUMAR ASHUMAL KESWANI, VS DC IT, C/O M/S VIJAY AGENCIES, CENTRAL CIRCLE 3, 2/3, VRAJ VATIKA COMPLEX, NEW DELHI. SIDDHARTH ROAD, BARODA. (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI RAJESH JAIN, CA RESPONDENT BY : SHRI KARTAR SINGH, CIT DR ORDER PER SUDHANSHU SRIVASTAVA, JUDICIAL MEMBER THESE APPEALS BY THE ASSESSEES FOR THE BLOCK PERIOD FROM ASSESSMENT YEAR 1997-98 TO 2003-04 (UPTO 23.10.2002 ) ARISE OUT OF THE SEPARATE ORDERS OF CIT (A)-II, NEW DELHI. T HESE APPEALS WERE EARLIER DISPOSED BY THE DELHI G BENCH OF THE ITAT BY A COMMON ORDER DATED 30.09.2008. IN IT (SS) A NO. 209/DEL/2005, THE BENCH HAD CONFIRMED THE ADDITION IN RESPECT IT(SS)A NO. 209 & 210/D/2005 BLOCK PERIOD FROM A.Y. 1997-98 TO 2003-04 2 OF JEWELLERY TO THE EXTENT OF RS.2,73,701/- AND IN RESPECT OF HOUSEHOLD GOODS TO THE EXTENT OF RS.1,50,000/-. IN IT (SS) A NO. 210/DEL/2005, THE BENCH HAD CONFIRMED THE ADDITION OF RS.1,87,500/- IN RESPECT OF HOUSEHOLD GOODS. THE A SSESSEES APPEALED BEFORE THE HON'BLE DELHI HIGH COURT AND TH E HON'BLE DELHI HIGH COURT IN ITS ORDER DATED 19.4.2010 IN I. T.A. NOS. 368 AND 369 OF 2009 HAS REMITTED THE MATTER TO THE TRIB UNAL FOR A CONSIDERATION OF THE SUBMISSIONS MADE BY THE ASSESS EES AFRESH WITH THE FOLLOWING DIRECTIONS:- HAVING CONSIDERED THE ARGUMENTS ADVANCED BY THE LEARNED COUNSEL FOR THE PARTIES, WE ARE OF THE VIEW THAT THESE APPEALS REQUIRE RE-CONSIDERATION BY THE TRIBUNAL. THE RE- CONSIDERATION IS PARTICULARLY WARRANTED BECAUSE THE JURISDICTIONAL ISSUE, WITH REGARD TO JEWELLERY IN I .T.A. NO. 368/2010 REQUIRES A FINDING TO BE GIVEN BY THE TRIB UNAL BEFORE WE CAN EXAMINE SUCH AN ISSUE ON MERITS. IN SO FAR AS THE HOUSEHOLD GOODS ARE CONCERNED, WE FIND THAT THE TRIBUNAL SHOULD EXAMINE AS TO WHETHER THESE GOODS PERTAINED TO THE BLOCK PERIOD OR NOT AND AS TO WHET HER SUCH GOODS COULD NOT HAVE BEEN ACQUIRED BY THE ASSESSEES FROM THEIR REGULARLY ASSESSED INCOMES. FOR THESE REASON S, WE SET ASIDE THE IMPUGNED ORDER TO THE EXTENT OF THE FINDI NGS WITH REGARD TO THE JEWELLERY AND HOUSEHOLD GOODS AND REM IT THE MATTER TO THE TRIBUNAL FOR A CONSIDERATION OF THE S UBMISSIONS MADE BY THE APPELLANT AFRESH. 2. THE FIRST ISSUE FOR CONSIDERATION, WHICH IS CO MMON IN BOTH THE APPEALS, RELATES TO ADDITION ON ACCOUNT OF HOUS EHOLD GOODS IT(SS)A NO. 209 & 210/D/2005 BLOCK PERIOD FROM A.Y. 1997-98 TO 2003-04 3 FOUND DURING THE COURSE OF SEARCH OPERATIONS. IN TH E CASE OF HARESH BHAI ASHUMAL BHAI KESHWANI, THE INVESTMENT I N HOUSEHOLD GOODS AMOUNTING TO RS. 1,50,000/- WAS FOU ND. THE SEARCH PARTY MADE INVENTORY OF HOUSEHOLD GOODS LIKE AIR CONDITIONER, FRIDGE, TELEVISION SOUND/MUSIC SYSTEM ETC. AND ESTIMATED THEIR VALUE AT RS. 1,50,000/-; AND MADE A DDITION IN THE ENTIRE BLOCK PERIOD WITHOUT ANY REFERENCE TO RE LEVANT ASSESSMENT YEAR COMPRISED IN THE BLOCK PERIOD. DURI NG THE COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSEE ATTE MPTED TO EXPLAIN THE SOURCE OF INVESTMENT OF EACH AND EVERY ITEM OF HOUSEHOLD GOODS AND IT WAS SUBMITTED THAT THEY HAVE BEEN ACQUIRED BEFORE THE BLOCK PERIOD. IT WAS STATED THA T THE ASSESSEE GOT MARRIED IN THE YEAR 1990 IN VERY RICH FAMILY BE LONGING TO HIGH STATUS OF SOCIETY AND ITEMS LIKE AIR CONDITIONER, S OUND SYSTEM, FRIDGE AND TELEVISION ETC. WERE NORMAL GIFTS GIVEN BY THEM TO THEIR CHILDREN AT THE TIME OF MARRIAGE AND OTHER OCCASION S LIKE DIWALI, ON BIRTH OF CHILDREN ETC. THE ASSESSING OFFICER PRO CEEDED TO MAKE ADDITIONS PRESUMING THAT THE ASSESSEE WAS NOT HAVIN G ANY AIR CONDITIONER, TV, FRIDGE ETC, THE NORMAL ITEMS OF HO USEHOLD GOODS, PRIOR TO 1.4.1996. IT(SS)A NO. 209 & 210/D/2005 BLOCK PERIOD FROM A.Y. 1997-98 TO 2003-04 4 3. IN THE CASE OF VIJAY KUMAR ASHUMAL KESHWANI, M OVABLE ASSETS IN THE FORM OF AIR CONDITIONER, FRIDGE, TREA D MILL MACHINE, TVS AND SOUND SYSTEM ETC. WERE FOUND THE VALUE THER EOF WAS ESTIMATED AT RS. 1,85,700/- BY THE SEARCH PARTY. IN THIS CASE ALSO IT WAS STATED THAT THESE ITEMS WERE RECEIVED AT THE TIME OF MARRIAGE IN 1990 FROM THE FAMILY OF LALWANI GROUP. SIMILAR ARGUMENTS AS IN THE CASE OF HARESHBHAI KESHWANI WER E ADVANCED IN THIS CASE ALSO. 4. THE LD. CIT (A) AFTER CONSIDERING THE ARGUMEN TS IN BOTH THE CASES HELD THAT SINCE THE ASSESSEE HAD NOT PROVIDED ANY DIRECT EVIDENCE TO SHOW AS TO HOW THE ARTICLES WERE ACQUIR ED, THE EXPLANATION OFFERED BY THE ASSESSEE WAS TREATED GEN ERAL IN NATURE AND WITHOUT ANY EVIDENCE. ACCORDINGLY, ADDITIONS MA DE BY THE ASSESSING OFFICER WERE UPHELD. 5. BEFORE US, THE LD. AR SUBMITTED THAT AS FAR AS T HE ISSUES IN IT(S S) A NO. 209/DEL/2005 ARE CONCERNED, A SEARCH AND SEIZURE OPERATIONS U/S 132 OF THE ACT WAS CONDUCTED ON 23.1 0.2002 AT THE RESIDENCE OF THE APPELLANT AT 14, TRIVENI PARK, BEHIND AKOTA STADIUM, AKOTA, BARODA IN CONSEQUENCE TO THE SEARCH AT THE IT(SS)A NO. 209 & 210/D/2005 BLOCK PERIOD FROM A.Y. 1997-98 TO 2003-04 5 RESIDENTIAL AND BUSINESS PREMISES OF VARIOUS ENTITI ES AND INDIVIDUALS ASSOCIATED WITH THE VIMAL GUTKA AND LAL WANI GROUP OF CASES. THE APPELLANT IS HUSBAND OF POONAM H KESH WANI, WHO IS SISTER OF OWNERS OF VIMAL GUTKA GROUP. IT WAS SU BMITTED THAT THE APPELLANT WAS ASSESSED TO INCOME TAX FOR THE LA ST SEVERAL YEARS AND FILED NIL UNDISCLOSED INCOME IN THE PRESC RIBED RETURN FORM NO 2B ON 21.07.2004, WHICH WAS ASSESSED AT RS. 7,44,243/- BY THE ASSESSING OFFICER. THE UNDISCLOSED INCOME AS PER THE ASSESSMENT ORDER COMPRISED THE FOLLOWING:- (I) UNEXPLAINED JEWELLERY 5,19,243/- (II) UNEXPLAINED EXPENDITURE ON FOREIGN TRAVEL 75,000/- (III) UNEXPLAINED INVESTMENT IN MOVABLE ASSETS 1,50,000/- 6. IT WAS SUBMITTED THAT AS PER ANNEXURE J1 OF PANCHNAMA DATED 23.10.2002, JEWELLARY AMOUNTING TO RS.4.96,49 3/- AND SILVER UTENSIL OF RS.22,750/- WERE FOUND FROM LOCKE R NO 270 WITH UTI BANK, GOTRY ROAD, BARODA. IT IS IMPORTANT TO NO TE THAT THE SAID LOCKER WAS HAVING FIRST NAME AS MRS. POONAM H KESHWANI, WIFE OF THE APPELLANT AND HARESH A KESHWANI, APPELL ANT AS SECOND NAME. THE VALUATION REPORT OF GOVERNMENT VAL UER AVAILABLE ON PAGE NO 16 OF THE PAPER BOOK DATED 23. 10.2002 IT(SS)A NO. 209 & 210/D/2005 BLOCK PERIOD FROM A.Y. 1997-98 TO 2003-04 6 CLEARLY MENTIONED THAT OWNER OF THE ITEMS IN LOCKER NO 270 UTI, GOTRY ROAD, BARODA BELONGS TO SMT. POONAM H KESHANI AND HARISH A KESHWANI. IT WAS SUBMITTED THAT BEFORE THE ASSESSING OFFICER AS WELL AS BEFORE THE LD. CIT(A), THE APPEL LANT HAD ARGUED THAT THE LOCKER IN WHICH THE JEWELLERY HAS BEEN FOU ND WAS IN THE JOINT NAME OF POONAM H KESHWANI AND THE APPELLANT A S SECOND NAME AND AS SUCH THERE CANNOT BE ANY COGNIZANCE OF THE CONTENTS OF THE LOCKER IN THE BLOCK ASSESSMENT OF T HE APPELLANT DUE TO THE FACT THAT THE CONTENTS TO THE LOCKER WER E MAINLY OWNED BY THE WIFE OF THE APPELLANT AND THE APPELLAN T WAS ONLY A JOINT HOLDER AND AS SUCH IF THE REVENUE WANTED TO I NITIATE PROCEEDINGS UNDER CHAPTER XIV B OF THE ACT THEN PRO CEEDINGS UNDER SECTION 158BD SHOULD HAVE BEEN INITIATED AGAI NST THE WIFE OF THE APPELLANT. 7. IT WAS FURTHER SUBMITTED THAT THE ASSESSING OFFI CER ALSO MADE AN ADDITION OF RS. 1,50,000 ON ACCOUNT OF UNEX PLAINED INVESTMENT IN ACQUIRING THE HOUSEHOLD ASSETS. THE A PPELLANT VIDE HIS SUBMISSION DATED 27.10.2004 (AVAILABLE ON PAGE NO 5 OF THE PAPER BOOK) FILED ITEM WISE EXPLANATION ON SOURCES OF HOUSEHOLD GOODS. IT WAS SUBMITTED THAT MOST OF THE HOUSEHOLD ITEMS WERE RECEIVED AT THE TIME OF MARRIAGE IN THE YEAR 1990. IT WAS ALSO IT(SS)A NO. 209 & 210/D/2005 BLOCK PERIOD FROM A.Y. 1997-98 TO 2003-04 7 SUBMITTED THAT THERE WAS NO MATERIAL FOUND AS A CON SEQUENCE TO SEARCH WHICH PROVES THAT THE HOUSEHOLD GOODS WERE A CQUIRED IN THE COURSE OF BLOCK PERIOD. IT WAS FURTHER SUBMITTE D THAT THE APPELLANT GOT MARRIED IN THE YEAR 1990, IN A VERY R ICH FAMILY, BELONGING TO HIGH STATUS OF SOCIETY. THEREFORE THE EXPLANATION OF THE APPELLANT SHOULD NOT HAVE BEEN REJECTED, IN SPI TE OF THE FACT THAT THERE WAS NO MATERIAL FOUND IN CONSEQUENCE TO SEARCH, WHICH COULD PROVE THAT THE SAID HOUSEHOLD GOODS WER E ACQUIRED IN THE BLOCK PERIOD. SAME ARGUMENTS WERE ADVANCED F OR THE GROUND RELATING TO ADDITION OF RS. 187,500/- ON ACC OUNT OF HOUSEHOLD GOODS IN THE CASE OF SHRI VIJAY KUMAR ASH UMAL BHAI KESHWANI. IT WAS SUBMITTED THAT THE INCOME WHICH IS NOT BASED ON THE BASIS OF EVIDENCE, OR MATERIAL FOUND AT THE TIME OF SEARCH I.E. BASED ON MERELY ON HYPOTHESIS, SURMISES, CONJE CTURES OR ESTIMATE CANNOT BE BROUGHT TO TAX UNDER CHAPTER XIV B. 8. THE LD. DR PLACED RELIANCE ON THE ORDERS OF THE AUTHORITIES BELOW. 9. WE HAVE HEARD THE RIVAL SUBMISSIONS AND CAREFULL Y PERUSED THE RELEVANT MATERIAL PLACED ON RECORD. AS FAR AS THE ISSUE OF IT(SS)A NO. 209 & 210/D/2005 BLOCK PERIOD FROM A.Y. 1997-98 TO 2003-04 8 ADDITION OF RS.2,21,782/- ON ACCOUNT OF UNEXPLAINED INVESTMENT IN JEWELLERY IS CONCERNED, WE ARE OF THE VIEW THAT THE SCHEME OF CHAPTER XIV-B OF THE INCOME TAX ACT, 1961 RELATING TO BLOCK ASSESSMENT MAKES IT CLEAR THAT IN VIEW OF SPECIFIC PROVISIONS CONTAINED IN SECTION 158BA, THE ASSESSMENT OF UNDIS CLOSED INCOME IS MADE AS A RESULT OF SEARCH. IT IS ONLY W HEN A SEARCH IS CONDUCTED UNDER SECTION 132 OR BOOKS OF ACCOUNT, OT HER DOCUMENTS ETC. ARE REQUISITIONED U/S 132 IN THE CAS E OF ANY PERSON THAT THE ASSESSING OFFICER PROCEEDS TO ASSES S THE UNDISCLOSED INCOME IN ACCORDANCE WITH THE PROVISION S OF CHAPTER XIV-B. IN THE CASE OF VERMA ROADWAYS VS ACIT TTJ 7 28 (ALLAHABAD TRIBUNAL), THE ALLAHABAD BENCH OF THE TR IBUNAL, WHILE CONSIDERING A SIMILAR ISSUE HAS HELD THAT VALIDITY OF A SEARCH AND SEIZURE U/S 132 HAS TO HAVE A CLEAR CUT NEXUS WITH THE WARRANT OF AUTHORIZATION, WHICH IS THE MAIN FOUNDATION OF ENTI RE PROCEEDINGS ON SEARCH AND SEIZURE. IN THE PRESENT APPEAL, THE WARRANT OF SEARCH WAS IN THE NAME OF SHRI HARISH ASHUMAL KESHW ANI WHEREAS THE LOCKER IN WHICH THE JEWELLERY WAS FOUND (LOCKER NO. 270) WAS IN THE NAME OF SMT. POONAM H. KESHWANI AS THE FIRST HOLDER AND HER HUSBAND SHRI HARISH ASHUMAL KESHWANI WAS ONLY THE SECOND HOLDER. FURTHER, THE SEARCH WARRAN T IN THE NAME IT(SS)A NO. 209 & 210/D/2005 BLOCK PERIOD FROM A.Y. 1997-98 TO 2003-04 9 OF THE ASSESSEE SHRI HARISH ASHUMAL KESHWANI FOR TH E SEARCH OF RESIDENTIAL PREMISES AT 14, TRIVENI PARK, BEHIND AK OTA STADIUM, BARODA AS PER PANCHNAMA DATED 23 RD OCTOBER, 2002 CANNOT COVER SEARCH FOR LOCKER NO. 270, UTI BANK, GOTRI RO AD, BARODA AND BELONGING TO SMT. POONAM H. KESHWANI AND SHRI H ARISH A. KESHWANI IN THE JOINT NAMES. THEREFORE, SINCE THERE WAS NO AUTHORIZATION FOR SEARCH FOR LOCKER NO. 270 SITUATE D IN ALTOGETHER DIFFERENT PREMISES AND THE LOCKER BEING IN THE NAME OF SMT. PONAM H. KESHWANI AS THE FIRST HOLDER, THE SAID JEW ELLERY CANNOT BE CONSIDERED IN THE BLOCK ASSESSMENT OF SHRI HARIS H A. KESHWANI, THE ASSESSEE. WE, ACCORDINGLY, ORDER DEL ETION OF RS.2,21,782/- ON ACCOUNT OF JEWELLERY AND SILVER UT ENSILS FOUND IN LOCKER NO. 270. 10. THE SECOND ISSUE REGARDING ADDITION ON ACCOUNT OF HOUSEHOLD GOODS IS COMMON TO BOTH THE ASSESSEES AND IS BEING DISPOSED OF TOGETHER. WE ARE OF THE OPINION THAT C HAPTER XIV-B IS A SEPARATE CODE TO BRING TO TAX ONLY THE UNDISCLOSE D INCOME. INCOME OR SOURCE THEREOF WHICH HAD BEEN DISCLOSED I N REGULAR RETURN CANNOT BE BROUGHT UNDER THIS CHAPTER. UNDISC LOSED INCOME WOULD INCLUDE ONLY THAT ASSET OR INCOME WHICH WAS BASED IT(SS)A NO. 209 & 210/D/2005 BLOCK PERIOD FROM A.Y. 1997-98 TO 2003-04 10 ON ANY ENTRY IN THE BOOKS OF ACCOUNT OR WOULD NOT H AVE BEEN DISCLOSED BY THE ASSESSEE TO THE DEPARTMENT FOR THE PURPOSE OF IMPOSING TAX UNDER THE ACT. SECTION 158B (B), THUS, IS A CHARGING PROVISION AND THIS PROVISION OF CHAPTER XIV- B APPL IES ONLY TO THOSE INCOMES WHICH CAN BE BROUGHT WITHIN THE DEFIN ITION UNDISCLOSED INCOME'. THE METHOD HOW UNDISCLOSED IN COME IS TO BE COMPUTED HAS BEEN GIVEN UNDER SECTION 158BB. SEC TION 158BB GIVES THE METHOD AS TO HOW UNDISCLOSED INCOME WITHIN THE BLOCK YEAR HAS TO BE PITTED. THE COMPUTATION HA S TO BE ON THE BASIS OF BOOKS OF ACCOUNT OR DOCUMENTS OR MATERIAL FOUND AS A RESULT OF SEARCH. IT IS A SETTLED LAW THAT COMPUTAT ION PROVISIONS CANNOT SUPERSEDE THE CHARGING PROVISIONS. IF SOME I NCOME CANNOT BECOME UNDISCLOSED INCOME WITHIN THE DEFINITION UND ER SECTION 158B (B), IT CANNOT BE BROUGHT TO TAX BY WAY OF COM PUTATION SECTION UNDER SECTION 158BB. THE COMPUTATION PROVIS IONS ARE TO BE APPLIED SUBSEQUENT TO THE CHARGING PROVISIONS. C HAPTER XIV-B IS AN INDEPENDENT CODE. OBJECT OF THE SAID CHAPTER IS TO BRING TO TAX UNDISCLOSED INCOME WHICH THE ASSESSEE HAS EARNE D DURING A BLOCK YEAR. HOW THIS INCOME IS TO COMPUTED, THE MET HOD HAS BEEN GIVEN UNDER SECTION 158BB. THUS, EVERY INCOME WHICH CAN BE REGARDED TO BE UNDISCLOSED INCOME WITHIN THE DEF INITION GIVEN IT(SS)A NO. 209 & 210/D/2005 BLOCK PERIOD FROM A.Y. 1997-98 TO 2003-04 11 UNDER SECTION I58BB CAN BE BROUGHT TO TAX UNDER THI S CHAPTER BY COMPUTING SUCH UNDISCLOSED INCOME ON THE BASIS OF E VIDENCE, MATERIAL OR RECORD FOUND AT THE TIME OF SEARCH. IF NO EVIDENCE, DOCUMENT, BOOKS OR MATERIAL IS FOUND AT THE TIME OF SEARCH, INCOME CANNOT BE COMPUTED UNDER THIS CHAPTER. THUS, THE INCOME WHICH IS NOT BASED ON THE OF EVIDENCE OR MAT ERIAL FOUND AT THE TIME OF SEARCH, I.E., BASED MERELY ON HYPOTH ESIS, SURMISES, CONJECTURES OR ESTIMATE, CANNOT BE BROUGHT TO TAX U NDER THIS CHAPTER. THE INCOME WHICH IS NOT UNDISCLOSED, I.E., INCOME WHICH HAS BEEN DULY DISCLOSED IN THE ASSESSEE'S BOOKS MAI NTAINED IN THE REGULAR COURSE OF BUSINESS CAN ALSO NOT BE BROU GHT TO TAX UNDER THIS CHAPTER. EVEN AN ASSET OR TRANSACTION WH ICH IS DULY ENTERED IN THE BOOKS MAINTAINED BY THE ASSESSEE REG ULARLY AND DISCLOSED TO THE DEPARTMENT CAN ALSO NOT BE REGARDE D TO BE UNDISCLOSED INCOME. THE ASSESSMENT UNDER THIS CHAPT ER IS IN ADDITION TO REGULAR ASSESSMENT AND INCOME ASSESSED WILL NOT BE INCLUDED IN REGULAR ASSESSMENT. THIS CHAPTER CANNOT BE REGARDED IN SUBSTITUTION OF REGULAR ASSESSMENT OR IN SUBSTIT UTION OF THE POWERS AVAILABLE TO THE ASSESSING AUTHORITY UNDER S ECTIONS 148 AND 263. THE LEARNED DEPARTMENTAL REPRESENTATIVE HA S NOT BEEN ABLE TO REBUT OR CONTROVERT THE SUBMISSION MADE BY THE LEARNED IT(SS)A NO. 209 & 210/D/2005 BLOCK PERIOD FROM A.Y. 1997-98 TO 2003-04 12 COUNSEL FOR THE ASSESSEES THAT NO MATERIAL OR EVIDE NCE WAS FOUND DURING THE COURSE OF SEARCH TO SHOW THAT ANY UNEXPL AINED EXPENDITURE WAS ACTUALLY INCURRED BY THE ASSESSEE O N HOUSEHOLD ITEMS. IT IS BY NOW WELL SETTLED THAT BLOCK ASSESSM ENT PROCEEDINGS ARE NOT MEANT FOR MAKING REGULAR ASSESSMENT BUT THE SAME ARE MEANT FOR ASSESSING THE UNDISCLOSED INCOME OF THE A SSESSEE BASED ON MATERIAL FOUND AS A RESULT OF SEARCH. UNDE R CHAPTER XIV-B, UNDISCLOSED INCOME HAS TO BE DETERMINED ON T HE BASIS OF EVIDENCE, DOCUMENTS AND MATERIAL FOUND DURING THE C OURSE OF SEARCH AND THE ASSESSING OFFICER IS NOT PERMITTED T O GO BEYOND THE MATERIAL FOUND AS A RESULT OF SEARCH AND TO MAKE RO VING ENQUIRIES IN ORDER TO ROPE IN CERTAIN INCOME WHICH IS NOT SUP PORTED BY ANY EVIDENCE OR MATERIAL FOUND DURING THE COURSE OF SEA RCH. IN THE PRESENT CASE, THE ADDITION ON ACCOUNT OF ALLEGED UN EXPLAINED EXPENDITURE INCURRED BY THE ASSESSEES HOUSEHOLD ITE MS WAS MADE WITHOUT THERE BEING ANY EVIDENCE OR MATERIAL F OUND DURING THE COURSE OF SEARCH TO SHOW THAT THE SAID EXPENDIT URE IN FACT WAS INCURRED BY THE ASSESSEES. IN THE CASE OF DAVID DHAWAN V. DY. CIT (1999) 71 ITD 1 (MUMBAI), THE MUMBAI BENCH OF THE TRIBUNAL HAS HELD THAT WITHOUT ANY MATERIAL FOUND D URING THE COURSE OF SEARCH TO SHOW THAT THE ASSESSEE HAD MADE IT(SS)A NO. 209 & 210/D/2005 BLOCK PERIOD FROM A.Y. 1997-98 TO 2003-04 13 UNEXPLAINED INVESTMENT OR HAD INCURRED UNEXPLAINED EXPENDITURE, IT COULD NOT BE HELD THAT THE ASSESSEE HAS EARNED ANY UNDISCLOSED INCOME WHICH WAS SPENT FOR MAKING S UCH INVESTMENT OR EXPENDITURE. IN THE CASE OF POOJA BHA TT V. ASSISTANT COMMISSIONER (2000) 73 ITD 205 (MUM), THE MUMBAI BE NCH OF THE TRIBUNAL HAS HELD THAT BLOCK ASSESSMENT IS SEPA RATE AND DISTINCT FROM REGULAR ASSESSMENT AND IN THE BLOCK A SSESSMENT, ADDITION CAN BE MADE ONLY ON THE BASIS OF MATERIAL F OUND DURING THE COURSE OF SEARCH. AS SUCH, CONSIDERING THE FACT S OF THE CASE AND KEEPING IN VIEW THE LEGAL POSITION EMANATING FR OM THE AFORESAID JUDICIAL PRONOUNCEMENTS, WE ARE OF THE VI EW THAT THE ADDITIONS MADE BY THE ASSESSING OFFICER AMOUNTING T O RS. 1,50,000/- IN THE CASE OF SHRI HARISH A. KESHWANI A ND RS. 1,85,700/- IN THE CASE OF SHRI VIJAY KUMAR ASHUMAL BHAI KESHWANI WERE OUTSIDE THE PURVIEW OF THE BLOCK ASSE SSMENT AND THE LEARNED COMMISSIONER (APPEALS) WAS NOT JUSTIFIE D IN CONFIRMING THE SAME. HIS IMPUGNED ORDER ON THIS ISS UE IS, THEREFORE, REVERSED AND THE ASSESSING OFFICER IS DI RECTED TO DELETE THE SAID ADDITIONS. 11. IN THE RESULT, THE APPEALS OF THE ASSESSEE ARE ALLOWED. IT(SS)A NO. 209 & 210/D/2005 BLOCK PERIOD FROM A.Y. 1997-98 TO 2003-04 14 ORDER PRONOUNCED IN THE OPEN COURT ON 4.3.2016. SD/- SD/- (J.S. REDDY) ( SUDHANSHU SRIVASTAVA) ACCOUNTANT MEMBER JUDICIAL MEM BER DATED: THE 4TH OF MARCH, 2016 GS COPY FORWARDED TO: - 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR, ITAT BY ORDER ASSTT. REGISTRAR