Sri. RAJESH R. NARAGNG, MUMBAI V. DCIT CENT. CIR. - 36, MUMBAI

ITSSA 230/MUM/2006

• Counselvise Citation: [2015] 122 COUNSELVISE.COM (IT) 1397 (ITAT-MUMBAI)
• Duration Of Justice: 9 year(s) 4 month(s) 16 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 21-12-2015
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: G
• Next Hearing Date: 21-12-2015
• Assessment Year: misc
• Appeal Filed On: 04-08-2006
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: SANJIV DUTT
• Assessee Lawyers: R R LINGSUR
• Keywords: Search and seizure
• Section: 131

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCH G, MUMBAI BEFORE SHRI N.K. BILLAIYA, ACCOUNTANT MEMBER AND SHRI SANDEEP GOSAIN, JUDICIAL MEMBER ITA NO.230/M/2006 BLOCK PERIOD : 1991-92 TO 2001-02 SHRI RAJESH R. NARANG, 40, ZIGZAG ROAD, PALI HILL, BANDRA (WEST), MUMBAI 400 050 PAN: ACGPN 9261J VS. DY. COMMISSIONER OF INCOME- TAX, CENTRAL CIRCLE-36 AAYAKAR BHAVAN, MUMBAI (APPELLANT) (RESPONDENT) PRESENT FOR: ASSESSEE BY : SHRI R. R. LINGSUR, A.R. REVENUE BY : SHRI SANJIV DUTT, D.R. DATE OF HEARING : 21.12.2015 DATE OF PRONOUNCEMENT : 21.12.2015 O R D E R PER N.K. BILLAIYA, ACCOUNTANT MEMBER: THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE LD. CIT(A)-CENTRAL VI, MUMBAI DATED 25.05.2006 PERTAINI NG TO THE BLOCK PERIOD FROM 1991-92 TO 2001-02. 2. THE ONLY GRIEVANCE OF THE ASSESSEE RELATES TO TH E ADDITION OF RS.6,36,400/- MADE TO THE INCOME OF THE ASSESSEE. THE BRIEF FACTS OF THE CASE ARE THAT SEARCH AND SEIZURE OPERATIONS WERE CARRIED OUT IN THE NARANG GROUP ON 07.11.2000. DURING THE COURSE OF SEARCH, THE ASSES SEE WAS FOUND IN POSSESSION OF CASH OF RS.6,36,400/-. THE ASSESSEE WAS ASKED T O FURNISH THE SOURCE OF THIS CASH. IN HIS PRELIMINARY STATEMENT ON 07.11.2000 T HE ASSESSEE STATED THAT THE CASH FOUND AT HIS RESIDENCE IS OUT OF THE WITHDRAWA L FROM BANK ACCOUNTS EITHER PERSONALLY OR HIS COMPANIES. HE ALSO STATED THAT P ART OF THE CASH ALSO BELONGS TO HIS WIFE AND WAS REFLECTED IN HER TAX RETURNS. ITA NO.230/M/2006 BLOCK PERIOD : 1991-92 TO 2001-02 SHRI RAJESH R. NARANG 2 3. HOWEVER, WHEN THE STATEMENT OF THE ASSESSEE ONCE AGAIN WAS RECORDED UNDER SECTION 131 ON 05.07.2001 AND WHEN THE ASSESS EE WAS ASKED TO EXPLAIN THE SOURCE OF CASH FOUND, HE STATED THAT IT HAS BEE N WITHDRAWN FROM HIS PERSONAL BANK ACCOUNT WITH CITY BANK AND THE BANK A CCOUNT OF M/S. NARANG OVERSEAS PVT. LTD. 4. HOWEVER, WHEN CONFRONTED WITH THE SAME QUESTION DURING THE COURSE OF THE ASSESSMENT PROCEEDINGS THE ASSESSEE STATED THAT RS.4,01,400/- WAS CASH BALANCE IN HIS PERSONAL ACCOUNT AND RS.2,35,018/- W AS CASH BALANCE IN M/S. NARANG OVERSEAS PVT. LTD. THE ASSESSEE DREW THE AT TENTION OF THE AO TO THE ENTRIES IN HIS CASH BOOK DATED 06.04.2000, 28.10.19 99, 21.03.2000 AND 03.05.2000 AND POINTED OUT THAT THE SAID CASH HAS B EEN RECEIVED FROM HIS BROTHER MR. RAJESH NARANG. ALL THE AFOREMENTIONED EXPLANATION OF THE ASSESSEE WAS RUBBISHED BY THE AO WHO WAS OF THE FIR M BELIEF THAT THE ASSESSEE IS CHANGING HIS EXPLANATION AGAIN AND AGAIN AND IS NOT CERTAIN ABOUT HIS SOURCE. THE AO MADE THE ADDITION OF RS.6,36,400/-. THE ASS ESSEE CARRIED THE MATTER BEFORE THE LD. CIT(A) BUT WITHOUT ANY SUCCESS. 5. BEFORE US, THE LD. COUNSEL FOR THE ASSESSEE DREW OUR ATTENTION TO THE CASH BOOKS OF PERSONAL ACCOUNT AND ALSO OF M/S. NAR ANG OVERSEAS PVT. LTD. AND POINTED OUT THAT THE CASH FOUND IS TALLIED WITH THE CASH BALANCE OF THE RESPECTIVE CASH ACCOUNT, THEREFORE, THE SAME SHOULD BE ACCEPTE D. PER CONTRA, THE LD. D.R. SUPPORTED THE FINDINGS OF THE REVENUE AUTHORITIES. 6. WE HAVE GIVEN A THOUGHTFUL CONSIDERATION TO THE ORDERS OF THE AUTHORITIES BELOW AND THE RELEVANT DOCUMENTARY EVIDENCES BROUGH T ON RECORD BEFORE US. THERE IS NO DISPUTE THAT THE ASSESSEE HAS BEEN CHAN GING HIS EXPLANATION AGAIN AND AGAIN. IT IS ALSO AN UNDISPUTED FACT THAT THE CASH BOOKS RELIED UPON BY THE ASSESSEE WERE NEVER FOUND AT THE TIME OF SEARCH. I T IS ALSO AN UNDISPUTED FACT THAT IN THE STATEMENTS OF THE ASSESSEE THERE IS NO REFERENCE TO THESE CASH BOOKS WHICH MEANS THAT THESE CASH BOOKS HAVE BEEN PREPARE D AFTERWARDS. HOWEVER, ITA NO.230/M/2006 BLOCK PERIOD : 1991-92 TO 2001-02 SHRI RAJESH R. NARANG 3 ENTRIES RELATING TO THE CASH RECEIVED FROM BROTHER MR. RAJESH NARANG CANNOT BE BRUSHED ASIDE LIGHTLY AS IN THE CASE OF MR. RAJESH NARANG THE SAID ENTRIES OF RS.1,75,000/- HAVE BEEN ACCEPTED. THEREFORE, IN OU R CONSIDERED OPINION THE ASSESSEE SHOULD GET A RELIEF OF RS.1,75,000/-. WE ACCORDINGLY MODIFY THE ORDER OF THE LD. CIT(A) AND DIRECT THE AO TO DELETE THE A DDITION OF RS.1,75,000/-. WE ACCORDINGLY CONFIRM THE ADDITION OF RS.4,61,400/ - 7. APPEAL FILED BY THE ASSESSEE IS PARTLY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 21.12.2015. SD/- SD/- (SANDEEP GOSAIN) (N.K. BILLAIYA) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI, DATED: 22.12.2015. * KISHORE, SR. P.S. COPY TO: THE APPELLANT THE RESPONDENT THE CIT, CONCERNED, MUMBAI THE CIT (A) CONCERNED, MUMBAI THE DR CONCERNED BENCH //TRUE COPY// [ BY ORD ER DY/ASSTT. REGISTRAR, ITAT, MUMBAI.