DCIT, New Delhi V. Sh. Tilak Raj Mehra, New Delhi

ITSSA 24/DEL/2008

• Counselvise Citation: [2011] 124 COUNSELVISE.COM (IT) 8545 (ITAT-DELHI)
• Duration Of Justice: 3 year(s) 27 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 11-03-2011
• Appeal Filed By: Department
• Order Result: Partly Allowed
• Bench Allotted: H
• Next Hearing Date: 21-02-2011
• Assessment Year: misc
• Appeal Filed On: 14-02-2008
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: REENA S PURI
• Keywords: Unexplained expenditure; Search and seizure; Document seized; Principle of natural justice; Block assessment; Retraction; Documents seized
• Section: 132; 139

Judgement Text

IT(SS)A. NO. 24/DEL/2008 1 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH H NEW DELHI BEFORE SHRI RAJPAL YADAV, JUDICIAL MEMBER AND SHRI SHAMIM YAHYA, ACCOUNTANT MEMBER I.T.(SS)A. NO. 24/DEL/2008 BLOCK PERIOD : 1.4.1997 TO 27.1.2003 DY. COMMISSIONER OF INCOME TAX, CIRCLE 24(1), ROOM NO. 238B, C.R. BUILDING, NEW DELHI VS. SH. TILAK RAJ MEHRA, 107-109, RAKESH DEEP BLDG., YUSUF SARAI, NEW DELHI (PAN/GIR: AAMPM8485M) (APPELLANT ) (APPELLANT ) (APPELLANT ) (APPELLANT ) (RESPONDENT ) (RESPONDENT ) (RESPONDENT ) (RESPONDENT ) ASSEESSEE BY : SH. TAPAS MISRA, ADV. DEPARTMENT BY : MS. REENA S. PURI, C.I.T.(D.R.) ORDER ORDER ORDER ORDER PER SHAMIM YAHYA: AM PER SHAMIM YAHYA: AM PER SHAMIM YAHYA: AM PER SHAMIM YAHYA: AM THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST THE LD. COMMISSIONER OF INCOME TAX (APPEALS)S ORDER DATED 1 6.11.2007 AND PERTAINS TO BLOCK PERIOD 1.4.97 TO 27.1.2003. 2. THE FIRST ISSUE RAISED IS THAT LD. COMMISSIONER OF INCOME TAX (APPEALS) ERRED IN DELETING THE ADDITION OF ` 5,32, 250/- MADE ON ACCOUNT OF UNEXPLAINED CASH AS UNDISCLOSED INCOME. 3. IN THIS CASE A SEARCH AND SEIZURE OPERATION WAS CARRIED OUT U/S 132 OF THE ACT AT THE OFFICE AND RESIDENTIAL PREMISE S OF THE ABOVE ASSESSEE ON 27.1.2003. DURING THE COURSE OF SEARCH AND SEIZURE CERTAIN INCRIMINATING DOCUMENTS RELATING TO THE ASSE SSEE WERE FOUND. ACCORDINGLY, NOTICE U/S 158BC OF THE IT ACT WAS ISS UED. THE ASSESSEE IS A PROPRIETOR OF TWO FIRMS NAMELY KUBER ENTERPRISE S AND ABC IT(SS)A. NO. 24/DEL/2008 2 INTERNATIONAL. THE NATURE OF BUSINESS IN THE N AME OF M/S ABC INTERNATIONAL IS BOOKING OF TICKETS FOR DOMESTIC AN D INTERNATIONAL TRAVELS. THE BUSINESS IN THE NAME OF M/S KUBER ENTER PRISES IS RECRUITING AGENCY FOR INTERNATIONAL PLACEMENT OF MA NPOWER IN FOREIGN COUNTRIES. DURING THE COURSE OF SEARCH, FOLLOWIN G AMOUNT OF CASH WAS FOUND AND SEIZED:- PREMISES PREMISES PREMISES PREMISES SEARCHED SEARCHED SEARCHED SEARCHED CASH CASH CASH CASH FOUND FOUND FOUND FOUND SEIZED SEIZED SEIZED SEIZED SH. TR MEHRA D-6/11, DLF PHASE-I, GURGAON, HARYANA 197950 150000 M/S KUBER ENTERPRISES 107-109, RAKESH DEEP BLDG., YUSUF SARAI, NEW DELHI 334300 300000 SMT. ANJNA MEHRA AND SH. TR MEHRA, LOCKER NO. 336, HDFC BANK, DLF PHASE-I, GURGAON, HARYANA NIL NIL 3.1 ASSESSEE WAS ASKED TO GIVE NECESSARY EXPLANATIO N IN THIS REGARD. ASSESSING OFFICER OBSERVED THAT IT IS AN ESTABLISH ED FACT THAT ASSESSEE HAS NOT WRITTEN ANY CASH BOOKS W.E.F. 1.4.2003 TO T HE DATE OF SEARCH, AS NO CASH BOOK WAS FOUND AND SEIZED, DURING THE COURSE OF SEARCH STATEMENT OF SHRI RAM CHANDER, MANAGER WAS RECORDED ON OATH. HE ALSO ADMITTED THAT NO BOOKS OF ACCOUNTS AND CASH BOO K FOR THE PERIOD 1.4.2003 TO 27.4.2003 HAD BEEN WRITTEN. ASSESSE E HAD PREPARED CASH BOOK AFTER THE DATE OF SEARCH. THE CONTENTI ON OF THE ASSESSEE THAT CASH BOOK WAS PREPARED ON THE BASIS OF THE S EIZED DOCUMENTS WAS ALSO FOUND TO BE NOT CORRECT BECAUSE THE RECEIP T BOOK NO. 3451 TO IT(SS)A. NO. 24/DEL/2008 3 3500 FOR WHICH THE ASSESSEE IS TRYING TO TAKE CREDI T, WAS NOT FOUND FROM HIS PREMISES ON THE DATE OF SEARCH. THUS, ACCO RDING TO THE ASSESSING OFFICER CASH FOUND HAVE BEEN PREPARED AF TER THE DATE OF SEARCH IS NOTHING BUT A MANIPULATED DOCUMENT WHICH I S NOT BASED ON ENTRIES RECORDED DURING THE NORMAL COURSE OF BUSINES S. HE ACCORDINGLY, HELD THAT CASH OF ` 1,97,950/- AND ` 3,34,300/- TOT ALING TO ` 5,32,250/- FOUND FROM THE POSSESSION OF THE ASSESSEE FROM HIS R ESIDENCE AND OFFICE RESPECTIVELY, REMAINED UNEXPLAINED AND WAS UN DISCLOSED INCOME OF THE ASSESSEE. 4. HOWEVER, UPON ASSESSEES APPEAL LD. COMMISSIONER OF INCOME TAX (APPEALS) FOUND THE SUBMISSIONS OF THE ASSESSEE AS CORRECT. HE OBSERVED THAT RECONSTRUCTION OF THE ACCOUNTS OF T HE ASSESSEE ARE BASED ON THE RECEIPT ISSUED FOR SERVICE CHARGES. HE NOTED THAT RECEIPT BOOKS WERE MAINTAINED IN ONE SERIAL ORDER, PART OF WHICH WERE SEIZED I.E. RECEIPT BOOK NO. 3430 TO 3450 AND PART OF WHIC H WERE NOT SEIZED I.E. RECEIPT BOOK NO. 3451 TO 3500 WERE VERY MUCH D OCUMENTARY EVIDENCES WITH THE HELP OF WHICH AVAILABLE CASH COU LD BE VERIFIED. ACCORDINGLY, LD. COMMISSIONER OF INCOME TAX (APPEALS) PROCEEDED TO HOLD THAT THE ADDITION IN THIS REGARD IS DELETED. 5. AGAINST THE ABOVE ORDER THE ASSESSEE IS IN APPEA L BEFORE US. 6. WE HAVE HEARD BOTH THE COUNSEL AND PERUSED THE R ECORDS. IT IS AN ADMITTED FACT THAT CASH BOOK IN THE SAID PERIOD WAS NOT MAINTAINED. AS PER THE PROVISIONS OF SECTION 158 BB(1)(D) UNDIS CLOSED INCOME FOR THE BLOCK PERIOD IS TO BE REDUCED WHERE THE PREVIOU S YEAR HAS NOT ENDED OR THE DATE FOR FILING THE RETURN OF INCOME UNDER SUB SECTION (1) OF SECTION 139 HAS NOT EXPIRED, ON THE BASIS OF ENT RIES RELATING TO SUCH INCOME OR TRANSACTIONS AS RECORDED IN THE BOOKS O F ACCOUNT AND OTHER IT(SS)A. NO. 24/DEL/2008 4 DOCUMENTS MAINTAINED IN THE NORMAL COURSE ON OR BEF ORE THE DATE OF THE SEARCH OR REQUISITION RELATING TO SUCH PREVIOUS YEAR. 6.1 FROM THE ABOVE, WE FIND THAT IT IS TRUE THAT SECT ION 158BB(1)(D) DOES NOT ONLY SPEAKS ABOUT REGULAR BOOKS OF ACCOUNT , BUT ALSO OTHER DOCUMENTS WHICH WERE MAINTAINED IN THE NORMAL COURSE OF BUSINESS. HOWEVER, THE ASSESSEES CONTENTION IS THAT RECEIPT BOOK NO. 3451 TO 3500 WHICH HAS BEEN TAKEN FOR ESTABLISHING THE CAS H SEIZED WAS IN EXISTENCE AT THE TIME OF SEARCH AS THE SAME WAS NOT SEIZED. THIS CONTENTION IS NOT SUPPORTED BY CORROBORATIVE EVIDEN CE. THERE IS NO EVIDENCE ON RECORD TO SUGGEST THAT THE SAID RECEI PT BOOK WAS MAINTAINED PRIOR TO THE DATE OF SEARCH. UNDER THE C IRCUMSTANCES, WE SET ASIDE THE ORDER OF THE LD. COMMISSIONER OF INCO ME TAX (APPEALS) AND RESTORE THAT TO ASSESSING OFFICER ON THIS ISSU E. 7. THE NEXT ISSUE RAISED IS THAT LD. COMMISSIONER OF INCOME TAX (APPEALS) ERRED IN DELETING THE ADDITION OF ` 6,09, 000/- MADE ON ACCOUNT OF UNEXPLAINED EXPENDITURE AND UNDISCLOSED ENTRIES IN THE SEIZED MATERIAL PAGE NO. 1 OF ANNEXURE A-22, CLEAR LY INDICATES THE RECEIPT OF ` 6,09,000/- BY THE ASSESSEE. 8. ON THIS ISSUE ASSESSING OFFICER IN THE ORDER OB SERVED THAT PAGE NO. 1 OF ANNEXURE A-22 SEIZED FROM THE OFFICE PREMIS ES OF THE ASSESSEE IS PAPER SHOWING ACCOUNT STATEMENT OF KUBER ENTERPRI SES FROM 8.4.2003 TO 27.4.2003 IN THE BOOKS OF M/S DYNAMIC S SALES AND SERVICES PVT LTD. ASSESSEE WAS ASKED TO EXPLAIN TH E ENTRIES IN THESE DOCUMENTS ALONGWITH NECESSARY DOCUMENTARY EVIDENCE. HOWEVER, THE ASSESSEE WAS ALSO ASKED TO CORRELATE THE ENTRIES AP PEARING IN THIS PARTICULAR ENTRIES WITH THE ENTRIES APPEARING IN HI S BOOKS OF ACCOUNTS. ASSESSEES EXPLANATION WAS NOT ACCEPTED BY THE ASSE SSING OFFICER. IT(SS)A. NO. 24/DEL/2008 5 THE ASSESSING OFFICER WAS OF THE VIEW THAT ASSESSE E WAS TRYING TO MISGUIDE BY GIVING WRONG EXPLANATION. HE REPRODUCED THE ENTRIES AS APPEARING IN THE SEIZED DOCUMENTS AND OBSERVED TH AT THESE DOCUMENTS SHOW CASH TRANSFER TO M/S KUBER ENTERPRISE S ON THE FOLLOWING DATES AND OF THE FOLLOWING AMOUNTS:- I) 8.4.2003 ` 4,00,000/- II) 19.4.2003 ` 1,00,000/- III) 27.4.2003 ` 90,000/- TOTAL = ` 5,90,000/ TOTAL = ` 5,90,000/ TOTAL = ` 5,90,000/ TOTAL = ` 5,90,000/- -- - 8.1 ASSESSING OFFICER THUS CONCLUDED THAT THESE CA SH HAVE BEEN GIVEN TO THE ASSESSEE AGAINST THE EXPORT OF MANPOWER . THIS ALSO FURTHER SHOWS THAT AFTER ADJUSTMENT MADE AGAINST THE CASH TRANSFERRED OF ` 5,90,000/-, M/S DYNAMICS SALES AND SERVICES PVT. LTD., FURTHER OWES ` 19000/- TO M/S KUBER ENTERPRISES. THIS SHO WS THAT TRANSACTIONS TOTALING TO ` 6,09,000/- HAVE TAKEN PLACE BETWEEN M/ S KUBER ENTERPRISES AND M/S DYNAMICS SALES. ACCORDINGLY, ASSESSING OFFICER HELD THAT THIS IS UNEXPLAINED INCOME OF THE ASSESSEE . 9. UPON ASSESSEES APPEAL LD. COMMISSIONER OF INCOME TAX (APPEALS) FOUND THAT CONTENTION OF THE ASSESSEE WAS CORRECT. HE HELD THAT IT IS NOT DENIABLE THAT THE SEIZED DOCUMENTS R EFLECTS THE ACCOUNT STATEMENT OF M/S KUBER ENTERPRISES AS APPEARING IN THE BOOKS OF M/S DYNAMICS SALES AND SERVICES P LTD. BUT THE CASH TRAN SFERRED RECORDED ON THREE DATES AS ` 4,00,000/- ON 8.4.2003, ` 1,0 0,000/- ON 19.4.2003 AND ` 90,000/- ON 27.4.2003 IS NOT PROVED BY THIS DOCUMENT ITSELF. IT(SS)A. NO. 24/DEL/2008 6 THE DEBIT AND CREDIT ENTRIES IN THE ACCOUNT STATEME NT ARE MERELY THE ENTRIES RECORDED IN THE DOCUMENT BUT DO NOT PROVE AC TUAL TRANSFER OF FUND TO THE ASSESSEE IN CASH. IT FURTHER SAYS THAT EVEN THE COMMISSION WAS NOT SENT TO THE ASSESSEE BECAUSE OF THE PROBLEMS OF NAPALESE WORKERS WHO WERE ULTIMATELY SENT BACK. LD. COMMISSION ER OF INCOME TAX (APPEALS) ALSO FOUND FAULT THAT IF THE ASSESSIN G OFFICER WAS NOT SATISFIED WITH THE CLARIFICATION OF THE ASSESSEE AN D GENUINENESS OF THE STATEMENTS AND VERACITY OF DOCUMENTS, THEN IT WAS N ECESSARY FOR HIM TO ASK THE ASSESSEE TO PRODUCE PERSON ALSO, AS PER PROCEDURE OF LAW. ACCORDINGLY, LD. COMMISSIONER OF INCOME TAX (APPEALS) PROCEEDED TO DELETE THE ADDITION OF ` 6,09,000/-. 10. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE RECORDS. WE FIND THAT ADDITION IN THIS CASED IS BASED UPON T HE FOLLOWING DOCUMENT SEIZED FROM THE PREMISES OF THE ASSESSEE AT THE TIME OF SEARCH AND SEIZURE OPERATION, THE SAME IS REPRODUCE D AS UNDER:- ACCOUNT STATEMENT OF KUBER ENTERPRISES FROM 8.4.20 03 TO 27.4.2003 DEAR SIR, PLEASE FIND BELOW STATEMENT OF OUR TRANSACTION AND I NFORM US FOR ANY CLARIFICATION. DR. (C) CR. (IC) BALANCE OPENING BALANCE 08/4/2003 CASH TRANSFER 400000 400000 IT(SS)A. NO. 24/DEL/2008 7 09/4/2003 DEPARTURE 15 OF ARCO @ 21000 315000 85000 10/04/2003 DEPARTURE 02 ACC @ 21000 42000 43000 19/4/2003 DEPARTURE 03 OF WHITE @ 21000 63000 - 20000 19/4/2003 DEPARTURE 03 ACC @ 21000 63000 - 83000 19/4/2003 CASH TRANSFER 100000 17000 23/4/2003 DEPARTURE 06 ARCO @ 21000 126000 - 109000 27/4/2003 CASH TRANSFER 90000 - 19000 OUTSTANDING AMOUNT - 19000 CC MIR AFLAATOON DYNAMIC SALES AND SERVICES P LTD. 11. A PERUSAL OF THE ABOVE CLEARLY SHOWS THAT CASH TRANSFER ARE RECORDED AMOUNTING TO ` 5,90,000/- AND A SUM OF ` 19 ,000/- IS FURTHER OWED TO THE ASSESSEE BY M/S DYNAMICS SALES AND SERVICE S LTD.. THUS, THERE IS CONSIDERABLE COGENCY THAT THIS AMOUNT WAS RECEIVED BY THE ASSESSEE. THE ASSESSEE HAS NOT BEEN ABLE TO REBU T THE CONTENTS OF THIS DOCUMENT WITH COGENT MATERIALS. ASSESSEE HAS TRIED TO EXPLAIN BY SUBMITTING A CERTIFICATE FROM M/S DYNAMICS SALES AND SERVICES P LTD. WHICH CAN BE SAID TO BE ONLY AN AFTER THOUGHT TO DI SPUTE THE VERACITIES OF THIS STATEMENT ON THE DATE OF SEARCH. HENCE, REGA RDING THIS ADDITION BASED ON DOCUMENTS FOUND DURING THE SEARCH, WE SET A SIDE THE ORDERS IT(SS)A. NO. 24/DEL/2008 8 OF THE LD. COMMISSIONER OF INCOME TAX (APPEALS) ON T HIS ISSUE AND RESTORE TO THAT OF ASSESSING OFFICER . 12. THE NEXT ISSUE RAISED IS THAT THE LD.CIT(A) HAS ERRE D IN DELETING THE ADDITION OF RS. 7,43,761/- MADE ON THE BASIS OF SEIZED DOCUMENT PAGE NO.28 OF ANNEXURE A-2 EVEN WHEN THE FIGURE WAS FOLLOWED BY @ 72.8 AND COULD NOT BE TELEPHONE NUMBER BY ANY STRETCH OF IMAGINATION. 12.1 IN THE SAID SEIZED DOCUMENT I.E. PAGE 28 OF ANNE XURE A-II THERE WAS A SMALL PIECE OF PAPER CONTAINING HAND WRITTEN DATES AN D FIGURES ON BOTH SIDE OF THE PAPER WHICH WAS FOUND FROM THE PERSONAL POSSESSION OF THE ASSESSEE ON THE DATE OF SEARCH. THE ASSESSEE WAS ASKED TO EXPLAIN THE ENTRIES AS APPEARING IN THIS PIECE OF PAPER. IN RESPONSE THE ASSE SSEE STATED THAT IT IS A STATEMENT OF INSTRUCTIONS RECEIVED FROM TIME TO TIME FROM FOREIGN EMPLOYERS ETC. THE ASSESSEE BEFORE THE INVESTIGATION WIN G HAD STATED THAT THE ENTRY RELATED TO MAN POWER REQUIREMENT RECEIVED FROM EMPLOYERS ABROAD ON SPECIFIC DATES. IN THIS PAPER THERE APPEARED A FI GURE OF 743761 @ 72.8 AGAINST THE ENTRY DT. 10.12.2002. THE ASSESSEE WAS ASKED TO EXPLAIN THIS. THE ASSESSEE HAS STATED ON OATH THAT THIS REFERS TO THE EN QUIRIES FOR IRON SCRAP WITH THE TELEPHONE NUMBER AND THE RATE OF SCRAP IN METRIC TONES AND THE TELEPHONE NUMBER 743761 REFERS TO THE PARTY WHE RE THE SCRAP WAS AVAILABLE. THE ASSESSEE WAS ASKED TO PROVIDE NAME AND AD DRESS OF THE PERSON WHO THE ASSESSEE CLAIMED TO BE THE SUBSCRIBER OF T HIS TELEPHONE NUMBER. HOWEVER THE ASSESSEE COULD NOT DO THE SAME. AO CONCLUDED THAT IT(SS)A. NO. 24/DEL/2008 9 THE PAGE CONTAINS NOTHING BUT ENTRIES REGARDING MAN P OWER EXPORT, THE STORY OF IRON SCRAP DEALER IS ONLY TO MISGUIDE THE ASSESSING AUT HORITY. AO HELD THAT THE FIGURE OF 743761 CLEARLY IS THE UNDISCLOSED INCOME OF ASSESSEE FROM SUCH MAN POWER EXPORTS. 13. UPON ASSESSEES APPEAL LD.CIT(A) HELD THAT IN RESPECT OF SEIZED DOCUMENT MARKED AS PAGE NO.28 A-II IT WAS ARGUED THAT AO DID NOT APPRECIATE THAT THIS DOCUMENT WAS ONLY A DUMB PAPER, IT DOES NOT SHOW EITHER THE RECEIPT OR PAYMENT MADE. ONE LOOSE PAPER MARKED AS ANNEXURE A-2 PAGE NO.28 WAS SEIZED FROM THE RESIDENTIAL PREMISES OF THE APPELLANT. THE ADDITION WAS MADE BY THE AO ON THE BASIS OF SCRIBB LING MADE WHICH NARRATED AS UNDER: 743761 @ 7.28. THE LD.CIT(A) H ELD THAT THE ABOVE LOOSE PAPER DOES NOT INDICATE ANY INCOME AND NO UNIT OF CU RRENCY WAS FOUND WRITTEN AGAINST SUCH FIGURE. IT IS A DUMB DOCUMENT A ND IT CAN NOT FORM PART OF UNDISCLOSED INCOME. ACCORDINGLY CIT(A) HAD DELETE D THE ADDITION. 14. AGAINST THIS ORDER THE REVENUE IS IN APPEAL BEFOR E US. WE HAVE HEARD BOTH THE COUNSELS AND PERUSED THE RECORDS. A CLOSE PER USAL OF THE SAID PAGE NO.28 OF ANNEXURE A-II, WE FIND THAT IT CONTAINS VAR IOUS ENTRIES IN A SCRIBBLING FORM REFERRING TO VARIOUS DATES ONLY ONE FIGURE OF 74 3761 @ 7.28 IS ALSO SCRIBBLED. IN OUR CONSIDERED OPINION THIS CANNOT BE D EEMED TO BE UNDISCLOSED INCOME OF ASSESSEE. IF THE ASSESSEE IS NOT ABLE TO RECALL THE EXACT NATURE OF THIS ENTRY. ASSESEES EXPLANATION THAT THE SAID RELATES TO TELEPHONE NUMBER AND SCRAP RATE HAVE NOT BEEN FOUND TO BE COGENT BY THE IT(SS)A. NO. 24/DEL/2008 10 A.O. BUT AT THE SAME TIME A PERUSAL OF THE SAID PAPER DOES NOT REVEAL THAT ANY SUM HAS BEEN RECEIVED BY THE ASSESSEE ON THIS ACCOUNT. HENCE WE UPHOLD THE ORDER OF LD.CIT(A) ON THIS ISSUE DELETING 743761 AS UNDISCLOSED INCOME OF ASSESSEE. 15. THE NEXT ISSUE RAISED IS THAT THE LD.CIT(A) ERRED I N DELETING ADDITION OF RS. 53,38,400/- MADE ON ACCOUNT OF UNDISCLOSED INCOME OF ASSESSEE ON THE BASIS OF SEIZED DOCUMENT OF ANNEXURE A-I BY ACCEPTING THE RETRACTION OF ASSESEES ADMISSION AND HIS EMPLOYER SHRI RAMCHANDER AND S HRI SUBHASH KUMAR AND HIS SUB AGENT SHRI SURENDER SHARMA WERE WI THOUT ANY REASONABLE BASIS WHILE AT THE SAME TIME RELYING ONLY ON THE SUBMISSION OF SHRI JOGENDER SING ANOTHER SUB AGENT OF THE ASSESSEE. 16. ON THIS ISSUE THE A.O. NOTED THAT ASSESSEE IS THE PROP RIETOR OF M/S KUBER ENTERPRISES WHICH IS ENGAGED IN THE BUSINESS OF MAN POWER EXPORTS. AT THE TIME OF SEARCH CERTAIN DOCUMENTS WERE RECEIVED WHICH CONTAINED LIST OF PERSONS WHO HAVE BEEN SENT ABROAD BY THE ASSESSEE. THE ASSESSEE WAS ASKED TO EXPLAIN THE SAME. IN RESPONSE THE ASSESSEE SUBMITT ED THAT IN RESPECT OF PAGES 27 TO 49 OF ANNEXURE A-21 THIS WAS A L IST PERTAINING TO PRE FLIGHT CHECK, GENERAL CORRESPONDENCE AND LIST OF PROP OSED CANDIDATES. ASSESSEES EXPLANATION IN THIS REGARD WAS NOT ACCEPTED BY THE A.O. WHO HELD THAT PAGES 17 TO 22 CLEARLY SHOW IN COLON.5 THE AMOUN T RECEIVED BY ASSESSEE IN THOUSANDS WHICH WAS NOWHERE REFLECTED IN HIS BOOKS O F ACCOUNTS. THE PLEA OF THE ASSESSEE THAT THE FIGURES ARE IN THOUSAND AND NOT IN THOUSANDS IT(SS)A. NO. 24/DEL/2008 11 BECAUSE BOTH IMPLY THE SAME. AO CONCLUDED IN THIS REG ARD AS UNDER: THE ASSESSEE HAS HIMSELF ADMITTED THAT THE FIGURES APPEARING O N PAGES 17 TO 22 OF ANNEXURE A1 CLEARLY SHOWED IN COLUMN 5, THE AMOU NTS RECEIVED BY THE ASSESSEE IN THOUSANDS. BEFORE THE LD.CIT(A) IT WAS ARGUE D THAT THE ANNEXURES SHOWN IN COL.NO.5 IT IS WRITTEN 504510 ETC. NOTHING MORE IS AVAILABLE. THESE DOCUMENTS DO NOT SHOW ANY UNDISCLOSED INCOME FOR THE PURPOSE OF I.T.ACT. HE OBSERVED THAT THIS IS TREAT LAW THERE IS NO DIRECT EVIDENCE FOUND DURING THE COURSE OF SEARCH. THERE SH OULD BE DIRECT NEXUS BETWEEN THE MATERIAL FOUND AND THE UNDISCLOSED INCOME DURING THE SEARCH. 17. UPON ASSESEES APPEAL THE LD.CIT(A) HELD AS UNDER. SO FAR AS ENTRIES IN THE SEIZED DOCUMENTS MARKED A S PAGE NO.17 TO 22 AND 24 TO 36 ON ANNEXURE A-I, SEIZED FROM THE RESIDENCE OF TH E APPELLANT IS CONCERNED, THERE IS NO DISPUTE THAT IT CONTAINS THE DETAILS OF MAN-POWER EXPORTED BY THE ASSESSEE. THE ASSESSEE ALSO CONCEDES THE SAME. EVEN THE FIGURE 5726/- WHICH IS THE TOTAL OF THE AMOUNTS JOTTED DOWN IN THE PAPERS D OES NOT ATTRACT ANY DISPUTE. THE DISPUTE HAS ARISEN ONLY WHETHER THIS INDICATES THE AMOUNT IN 'THOUSANDS' OR ONLY IN 'THOUSAND'. ACCORDING TO THE ASSESSING OFFI CER THE PLEA OF THE ASSESSEE THAT THE FIGURES ARE IN THOUSAND AND NOT IN THOUSANDS IS NOT LOGICAL BECAUSE BOTH IMPLY THE SAME. HOWEVER, THE ASSESSEE INSIST THAT THE FIG URES REPRESENT ONLY IN THOUSAND AND NOT IN THOUSANDS MEANING THEREBY THAT FIGURE RS.5726/- IS ACTUALLY THE AMOUNT OF RS.572600/- AND NOT RS.57,26,000/- AS CONCLUDED BY THE ASSESSING OFFICER. NOW ON PERUSAL OF THESE SEIZED DOCUMENTS I T IS FOUND THAT THE AMOUNT WRITTEN IN THE LAST COLUMN IS 45, 35, 50 AND 55 ETC . ACCORDING TO THE ASSESSEE IT(SS)A. NO. 24/DEL/2008 12 THESE FIGURES REPRESENT RS.4500/-, RS.3500/-, RS.50 00/- AND RS.5500/- ETC. THUS THE TOTAL RECEIPT WAS RS.5,72,600/-. NOW APART FROM THESE CODED FIGURES THERE IS NOT EVEN A SINGLE ENTRY IN THESE SEIZED DOCUMENTS W HICH WOULD INDICATE THAT THEY MEAN RS.4500/- OR RS.45,000/-. SIMILARLY DURING THE COURSE OF SEARCH NO OTHER DOCUMENT WAS SEIZED WITH THE HELP OF WHICH IT COULD BE CONCLUDED THAT THE FIGURES APPEARING IN THESE SEIZED DOCUMENTS MEAN RS .4500/- OR RS.45,000/-. IN SUCH CIRCUMSTANCES WHAT HAS BEEN EXPLAINED BY THE A PPELLANT HAS TO BE ACCEPTED BECAUSE THERE IS NO OTHER WAY TO PROVE THAT THE FIG URE MEANS IN THOUSANDS, I.E RS.45,000/-, RS.35,000/- AND RS.50,000/- ETC. THE R EASON WHY THE ASSESSING OFFICER HAS CONCLUDED THAT THESE FIGURES REPRESENT IN THOUSANDS AND THEREFORE THE TOTAL SHOULD BE RS.57,26,000/- IS THE STATEMENTS OF THE AGENT SHRI SURENDER SHARMA, OFFICE ASSISTANT OF THE APPELLANT SHRI SUBH ASH , THE STATEMENT OF THE MANAGER SHRI RAM CHANDER IN ADDITION TO THE SINGH B ILLOO, ANOTHER AGENT. ACCORDING TO THE ASSESSING OFFICER THE APPELLANTS' SUBMISSION THAT THESE DOCUMENTS ARE THE LISTS OF THE IMMIGRANTS SENT BY S HRI JOGINDER SINGH BILLO WAS INCORRECT BECAUSE SHRI JOGINDER SINGH IN HIS STATEM ENT RECORDED ON OATH ON 11.8.03 HAD DENIED THE KNOWLEDGE OF THESE SET OF DO CUMENTS. SIMILARLY REFERRING THE STATEMENT OF SHRI SURRENDER SHARMA RECORDED ON 30.5.03 AND 9.6.03 WHO STATED THAT SHRI T.R.MEHRA USED TO GET RS.50,000/ AND RS.60,000/- PER PERSON EXPORTED FOR CONFIRMED JOB PLACEMENTS, IT WAS CONCLU DED BY THE AO THAT THE APPELLANT HAD RECEIVED EXCESSIVE AMOUNT FROM THESE IMMIGRANTS OVER AND ABOVE WHAT WAS FOUND WRITTEN IN HIS REGULAR BOOKS OF ACCO UNTS. SIMILARLY REFERRING TO THE STATEMENT OF SHRI SUBHASH, OFFICE ASSISTANT OF THE APPELLANT FOR KUBER ENTERPRISES RECORDED ON OATH ON 27.5.03, DURING 'THE COURSE OF SEARCH WHO STATED THAT M/S KUBER ENTERPRISES USED TO SUPPLY MAN POWER TO UAE A ND USED TO CHARGE IT(SS)A. NO. 24/DEL/2008 13 APPROXIMATELY RS.50,000/- TO RS.60,000/-, IT WAS AG AIN CONCLUDED THAT THE APPELLANT HAD CHARGED MUCH MORE SERVICE CHARGES THA N WHAT WAS WRITTEN IN REGULAR BOOKS OF ACCOUNTS AND AS THE SAME REMAINED OUT OF THE BOOKS IT NEEDED TO BE TAXED AS UNDISCLOSED INCOME OF THE ASSESSEE. SIMILARLY HE REFERRED TO THE STATEMENT OF SHRI RAM CHANDER, MANAGER OF THE APPEL LANT RECORDED ON 4.6.03 WHO STATED THAT OVER AND ABOVE THE NORMAL SERVICE F EE AND OTHER EXPENSES M/S KUBER ENTERPRISES USED TO CHARGE BETWEEN RS.25,000/ - TO RS.30,OOO/-. HOWEVER, SUCH CONCLUSION OF THE ASSESSING OFFICER WAS BASED ON UNILATERAL EVIDENCES WITHOUT ACCORDING THE APPELLANT SUFFICIENT AND REAS ONABLE OPPORTUNITY TO CROSS- EXAMINE THESE PERSONS AND BRING OUT THE CORRECT FAC TS ON RECORD. THEREFORE IF THE STATEMENTS WHICH WERE RECORDED BEHIND THE BACK OF T HE APPELLANT AND THE APPELLANT WAS NOT ACCORDED SUCH OPPORTUNITY TO CROS S-EXAMINE THEM, IT WAS DENIAL OF NATURAL JUSTICE AND IN THAT CASE THE STATE MENTS HAD NO EVIDENTIARY VALUE. FURTHER THE AFFIDAVITS SUB-MITTED BY THESE PERSONS WHEREBY THEY HAD RETRACTED FROM THEIR EARLIER STATEMENTS WERE SUMMARILY REJECTE D BY THE ASSESSING OFFICER ONLY ON THE GROUND THAT THEY WERE SELF SERVING DOCU MENTS SUBMITTED BY THE APPELLANT AND WERE PRODUCED JUST TO SERVE HIS OWN CA USE. ACCORDING TO THE ASSESSING OFFICER SHRI RAM CHANDER AND SHRI SUBHASH ARE THE EMPLOYEES OF THE ASSESSEE AND PRESENTLY WORKING WITH THE APPELLANT A ND EVEN SHRI SURENDER SHARMA IS A SUB-AGENT OF THE ASSESSEE AND THEREFORE IT WAS VERY MUCH POSSIBLE THAT THESE AFFIDAVITS WERE PROCURED BY THE ASSESSEE TO SERVE HIS OWN CAUSE. ACCORDING TO HIM HAD THERE BEEN ANY TYPE OF COERCIO N OR PRESSURE AT THE TIME OF RECORDING OF THE STATEMENT, THE AFORESAID PERSONS H AD EVERY OPPORTUNITY TO RETRACT FROM THEIR STATEMENTS. THE FACT THAT THEY W ERE RETRACTING FROM THEIR STATEMENT AFTER TWO YEARS MADE THE RETRACTION LIABL E TO BE REJECTED. EVEN SHRI IT(SS)A. NO. 24/DEL/2008 14 RAM CHANDER WHOSE STATEMENT WAS AGAIN RECORDED ON 4 .6.03 DID NOT RETRACT FROM HIS EARLIER STATEMENT RECORDED ON 25.7.03. BECAUSE OF THESE REASONS THE AFFIDAVITS WERE REJECTED. HOWEVER, IT IS SEEN THAT AS THE APPEL LANT HAD NOT BEEN ALLOWED ANY OPPORTUNITY TO CROSS EXAMINE THESE PERSONS, HE WAS UNAWARE OF THE FACT THAT THESE EVIDENCES WOULD BE USED AGAINST HIM AND THERE FORE HE HAD NO WAY OUT BUT TO PRODUCE THE AFFIDAVITS OF THESE PERSONS IN ORDER TO CONTROVERT THEIR STATEMENT RECORDED EARLIER AS WELL AS TO DISPROVE THE CONCLUS ION OF THE ASSESSING OFFICER. THE DELAY IN RETRACTION BY TWO YEARS WAS ALSO LOGICAL F OR THE SIMPLE REASON THAT WHEN THE APPELLANT CAME TO KNOW THAT THE STATEMENTS OF T HESE PERSONS WERE BEING USED AGAINST HIM, THEN ONLY THE OCCASION AROSE TO F ILE SUCH AFFIDAVITS. THESE AFFIDAVITS WERE VALID DOCUMENTARY EVIDENCES AND WIT HOUT CONTROVERTING THE STATEMENT OF THE DEPONENTS AND REFUTING ITS CONTENT S, SUMMARY REJECTION OF THIS PARTICULAR PIECE OF DOCUMENTARY EVIDENCE WAS NOT CO RRECT AND NOT IN ACCORDANCE WITH THE LAW. AS A MATTER OF FACT WHEN THE ASSESSIN G OFFICER REQUIRED THE APPELLANT TO EXPLAIN REASON FOR SUCH RETRACTION, FR ESH AFFIDAVITS OF THESE PERSONS WERE SUBMITTED AGAIN EXPLAINING THE REASONS THEREIN AND REITERATING THEIR STATEMENT GIVEN IN THE EARLIER AFFIDAVITS AND THERE FORE IT WAS ALL THE MORE NECESSARY FOR THE ASSESSING OFFICER TO EXAMINE THES E PERSONS AND CONTROVERT THEIR STATEMENT SO AS TO BRING OUT AS TO WHAT THEY HAD ST ATED ORIGINALLY BEFORE THE DEPARTMENT ONLY WAS TRUE AND CORRECT STATEMENT. THU S BASED ON THEIR STATEMENTS ONLY IT COULD NOT BE CONCLUDED THAT THE APPELLANT U SED TO CHARGE MUCH MORE AMOUNT THAN WHAT WAS WRITTEN IN THE REGULAR BOOKS O F ACCOUNTS. IT IS ALSO SEEN THAT THE APPELLANT HAD NOT ONLY FILED AFFIDAVITS OF THESE PERSONS BUT ALSO CERTIFIED COPIES OF THE AFFIDAVITS OF THE WORKERS EXPORTED BY HIM ABROAD WHICH HAD NECESSARILY TO BE DEPOSITED WITH THE GOVERNMENT DEP ARTMENT BEFORE THEIR IT(SS)A. NO. 24/DEL/2008 15 IMMIGRATION TO FOREIGN COUNTRIES. NOW ALL THE 33 AF FIDAVITS SUBMITTED BY THE APPELLANT WERE EXECUTED IN THE YEAR 1999, MUCH BEFO RE THE DATE OF SEARCH AND COPY OF ALL OF THEM WERE DULY ATTESTED BY THE NOTAR Y PUBLIC DELHI. THUS THESE AFFIDAVITS COULD NOT HAVE BEEN CREATED AFTER THE DA TE OF SEARCH SO AS TO CAUSE ANY ADVANTAGE TO THE APPELLANT. BECAUSE OF THESE REASON S ALSO THEY WERE ACCEPTABLE DOCUMENTARY EVIDENCES. NOW IN SUM AND SUBSTANCE ALL THESE AFFIDAVITS SAY THAT THEY HAD PAID SERVICE CHARGES OF ABOUT OF RS.3000/- TO THE APPELLANT, AS PER THE RULES AND REGULATIONS OF THE GOVERNMENT OF INDIA, M INISTRY OF LABOUR, NEW DELHI AND HAD NOT PAID ANY MORE AMOUNT EXCEPT THE SAME. T HESE AFFIDAVITS EXPLAIN IN ABUNDANCE THAT THE SERVICE CHARGES RECEIVED BY THE APPELLANT WAS RS.3,000/- PER PERSON ONLY AND IT WAS ACCORDINGLY RECORDED IN THE REGULAR BOOKS OF ACCOUNTS. THE APPELLANT HAS SUBMITTED DETAILED RECONCILIATION CHA RT SHOWING THE NAME OF THE PERSONS APPEARING IN A PARTICULAR SEIZED DOCUMENT, THE AMOUNT OF SERVICE CHARGES RECEIVED FROM HIM, THE DATE OF RECEIPT AND RECEIPT NUMBER AND THE CASH BOOK AND LEDGER FOLIO NUMBER WHEREIN THEY ARE FOUND RECORDED IN THE BOOKS OF M/S KUBER ENTERPRISES AS WELL AS ABC INTERNATIONAL. THUS IT C ANNOT BE SAID THAT THE ENTIRE RECEIPT AS APPEARING IN THESE SEIZED DOCUMENTS WAS UNDISCLOSED INCOME OF THE APPELLANT. THIS IS FOUND FURTHER SUPPORTED BY THE V OUCHERS OF 'EMIGRATION EMPLOYMENT FEES' FOR THE AMOUNT DEPOSITED BY THE AP PELLANT IN THE OFFICE OF THE 'PROTECTOR OF EMIGRANTS', MINISTRY OF LABOUR, DELHI . FROM THE RECONCILIATION STATEMENT FILED BY THE ASSESSEE IT IS FOUND THAT AV ERAGE RECEIPT ACCOUNTED FOR BY THE APPELLANT IN THE BOOKS OF M/S KUBER ENTERPRISES IS RS. 3150/- AND IN THE BOOKS OF ABC INTERNATIONAL RS. 8000/- ,PER PERSON THAT TO O NOT IN RESPECT OF EACH AND EVERY PERSON. NOW EVEN IF ACCORDING TO THE APPELLAN T'S OWN ADMISSION IF THE RECEIPT OF MONEY JOTTED DOWN IN THESE SEIZED DOCUMEN TS IS CONSIDERED TO BE IN IT(SS)A. NO. 24/DEL/2008 16 THOUSAND ONLY (AS EXCEPT THIS THERE IS NO ALTERNATI VE), THE AVERAGE RECEIPT PER PERSON COMES TO RS. 5000/-. OUT OF THIS RECEIPT OF RS. 3150/- PER PERSON STANDS ACCOUNTED FOR IN REGULAR BOOKS OF ACCOUNT OF M/S KU BER ENTERPRISES, STILL THERE REMAINS RECEIPT OF RS. 1850/- PER PERSON UNACCOUNTE D. IT IS ALSO WORTHWHILE TO NOTE THAT THOUGH THE APPELLANT HAD FURNISHED AFFIDA VITS OF SHRI SURENDRA SHARMA, SHRI SUBHASH KUMAR AND SHRI RAM CHANDER SO AS TO CO NTROVERT THEIR STATEMENTS, GIVEN EARLIER, NO SUCH AFFIDAVIT HAS BEEN FILED IN RESPECT OF THE STATEMENT OF SHRI JOGINDER SINGH BILLO. THIS CLEARLY MEANS THAT HIS S TATEMENT DATED 1-1.8.2003, REMAINS UNCONTROVERTED WHICH FURTHER IMPLIES THAT I T IS ACCEPTABLE TO THE APPELLANT. EVEN OTHERWISE AS SHRI JOGINDER SINGH BI LLO WAS A CLOSE ASSOCIATE OF THE ASSESSEE, REGULARLY SUPPLYING MANPOWER TO HIM AND C OLLECTING NECESSARY CHARGES ON HIS BEHALF HE WAS WELL AWARE OF BUSINESS AFFAIRS OF THE ASSESSEE AND AS HIS STATEMENT REMAINS UNCONTROVERTED, IT CAN NOT BE IGN ORED AND HAS TO BE ESSENTIALLY TAKEN INTO ACCOUNT. NOW SHRI JOGINDER SINGH BILLO I N ANSWER TO QUESTIONS IN PAGE NO.3 & 4 OF HIS STATEMENT DATED 11.8.03 HAS STATED AS UNDER:- 'I GET RS. 15000/-- , RS. 1600/- FROM ~ACH PERSON D EALT AND THEN SEND THEM TO SHRI T.R.MEHRA' ' THE RS. 16000/- CHARGED BY ME INCLUDE S TICKET CHARGES ETC'. Q. HOW MUCH COMMISSION YOU GET FROM SHRI T.R.MEHRA WHEN HE COLLECTS MONEY DIRECTING FROM THE PERSONS SENT BY YOU ? ANS .. 'HE GIVES RS. 2000/- AS COMMISSION IN SUCH C ASE TO ME. WHEN I COLLECT MONEY OF RS. 16000/-, I KEEP MY COMMISSION OF RS. 2 000/-- AND SEND THE BALANCE TO SHRI T.R.MEHRA. THE BALANCE MONEY IS FOR TICKET CHARGES ETC WHICH SHRI T.R.MEHRA ARRANGES. THE REMAINING MONEY SHRI T .R.M EHRA KEEPS HIMSELF'. IT(SS)A. NO. 24/DEL/2008 17 FROM THE ABOVE STATEMENT IT WOULD BE CLEAR THAT SHR I JOGINDER SINGH BILLO, AFTER DEDUCTING HIS COMMISSION OF AVERAGE OF RS. 2000/- P ER PERSON OUT OF RECEIPT OF RS. 16,000/- USED TO GIVE TO SHRI T.R.MEHRA RS. 14000/- PERSON. NOW AS STATED ABOVE SHRI T.R.MEHRA HAS ACCOUNTED FOR AVERAGE OF RS. 315 0/- IN THE BOOKS OF M/S KUBER ENTERPRISES AND RS. 8000/- IN THE BOOKS OF ABC INTE RNATIONAL. THUS OUT OF AVERAGE RECEIPT OF RS. 14000/- FROM SHRI JOGINDER SINGH, TH E APPELLANT HAS ACCOUNTED FOR IN HIS BOOKS ONLY TO THE EXTENT OF RS. 11,150/- AND BA LANCE OF RS. 2850/- STILL REMAINED UNACCOUNTED. THERE IS NO DISPUTE THAT 136 EMIGRANTS WERE SENT BY THE APPELLANT AS FOUND RECORDED IN THE SEIZED DOCUMENTS NO 17 TO 22 OF ANNEXURE A- 21. TWO PERSONS WERE SENT PERTAINING TO ASSESSMENT YEAR 20001-02 AND THE REST OF 134 IN ASSESSMENT YEAR 2000-01. ACCORDINGLY INCO ME TO THE EXTENT OF RS. 5700/- ( RS. 2850 X 2) REMAINED UNDISCLOSED FOR ASS ESSMENT YEAR 2001-02 AND RS. 381900 (RS. 2850 X 134) FOR ASSESSMENT YEAR 2000-01 . THUS THE TOTAL ADDITION BASED ON THESE SEIZED DOCUMENTS, WHICH CAN BE SUSTA INED WOULD BE RS. 3,87,600/-. ACCORDINGLY ADDITION TO THE EXTENT OF R S. 3,87,600/- IS HEREBY CONFIRMED AND BALANCE OF RS. 53,38,4001- IS HEREBY DELETED. 18. WE HAVE HEARD THE PARTIES AND PERUSED RECORDS. W E FIND THAT FOR A PROPER APPRECIATION OF THE ABOVE, IT WOULD BE APPRO PRIATE TO REFER HERE TO ASSESEES SUBMISSIONS DURING THE COURSE OF SEARCH WHICH ARE R EPRODUCED FROM Q.NO.12 AT PAGE NO.262 OF THE SUPPLEMENTARY PAP ER BOOK OF ASSESSEE. Q.NO.12 : PLEASE SEE PAGE 35 OF ANNEXURE AI AND COMME NT ON THE SAME. ANS.(A STATEMENT OF SHRI TR MEHRA) THIS IS THE LIST OF EMIGRANTS OF AGENT MR.BILLO SOMETIMES BACK. COLUMN 1 INDICATE NAME OF A GENT, COLUMN 2 IS IT(SS)A. NO. 24/DEL/2008 18 FATHERS NAME, COL.3 PROFESSION, COL.4 PASSPORT NUMBER A ND COL.5 AMOUNT OF RUPEES IN THOUSANDS. THIS LIST WAS PREPARED BY MR.BILLOO AND THESE AMOUNTS ARE SET TO BE ACTUALLY AMOUNTS CHARGED BY HIM. AFTER THIS INSTANCE I BROKE OFF MY BUSINESS RELATIONS ALMOST FROM TWO YEARS. 18.1 FROM THE ABOVE IT IS EVIDENT THAT AT THE TIME O F SEARCH ITSELF, THE ASSESSEE HAS STATED THAT IN THE DOCUMENT THE AMOUNT MEN TIONED IS THE CHARGES TAKEN BY MR. BILLOO. HENCE, ADDITION ON ESTIM ATE BASIS IN THE HANDS OF ASSESSEE IS NOT WARRANTED. HOWEVER, WE NOTE THAT LD. COMMISSIONER OF INCOME TAX (APPEALS) HAS ELABORATELY CONSIDERED THE ISSU E AND CONFIRMED AN ADDITION OF ` 387600/-. 18.2 UPON OVERALL CONSIDERATION WE UPHOLD THE ORDER OF LD. COMMISSIONER OF INCOME TAX (APPEALS) ON THIS ISSUE. 19. THE NEXT ISSUE RAISED IS THAT THE LD.CIT(A) HAS ERR ED IN DELETING RS. 86,10,000/- WERE ON ACCOUNT OF UNDISCLOSED INCOME BASE D ON SEIZED DOCUMENT NO. 29 TO 47 OF ANNEXURE A 21 BY WRONGLY R ELYING ON A STATEMENT OF SUB AGENT WHILE IGNORING ASSESEES SUBMISSIONS AND HIS EMP LOYERS STATEMENT. 20. ON THIS ISSUE THE AO MADE THE ADDITION HOLDING AS U NDER. AS REGARDS THE ENTRIES APPEARING ON PAGES 27 TO 49 OF ANNEXURE A- 21 SEIZED FROM OFFICE, THE ASSESSEE HAS HIMSELF ACCEPTED THAT THESE CONTAIN THE NAMES OF 205 WORKERS WHO WERE ACTUALLY EX PORTED BY M/S IT(SS)A. NO. 24/DEL/2008 19 KUBER ENTERPRISES. FROM THE ABOVE DISCUSSION PERTAININ G TO PAGES 17 TO 22 OF ANNEXURE A-1 OF RESIDENCE, IT IS ABUNDANTLY CLEAR THAT THE ASSESSEE IS MAINTAINING THE LISTS OF PERSONS FROM WHOM HE CH ARGES SUBSTANTIAL SUMS OVER AND ABOVE THE FEES DISCLOSED BEFORE THE TAX AUTHORITIES. THUS THERE IS NOT AN IOTA OF DOUBT THAT INCOME IN RESPECT OF THESE 205 PERSONS HAS ALSO BEEN CONCEALED BY THE ASSESSE E. THE PLEA OF THE ASSESSEE THAT NO AMOUNTS HAVE BEEN MENTIONED AGAINST THE NAMES OF THESE 205 PERSONS AND SO THIS GOES BEYOND THE PURVIEW OF THE BLOCK ASSESSMENT ALSO HOLDS NO GROUND. THIS IS SO B ECAUSE THE ASSESSEE HAD PREPARED SIMILAR LISTS FOR THE PERSONS MENTION ED ON PAGES 17 TO 22 OF ANNEXURE A-I OF HIS RESIDENCE. IN F ACT FOR THE 136 WORKERS MENTIONED ON PAGES 17 TO 22 OF ANNEXURE A-I O F RESIDENCE THE ASSESSEE HAD PREPARED DUPLICATE LISTS OF SUCH PERSON ON PAGES 24 TO 29. THIS DUPLICATE LIST AS APPEARING ON PAGES 24 T O 29 OF ANNEXURE A-I OF RESIDENCE ALSO DO NOT HAVE ANY AMOUNT S MENTIONED THEREIN. HOWEVER, IT HAS BEEN PROVED IN THE ABOVE D ISCUSSION THAT THERE HAS BEEN A CONCEALMENT OF RS. 57,26,000/- AS FAR AS THE 136 PERSONS MENTIONED IN THESE LISTS ARE CONCERNED WHICH CO MES TO APPROXIMATELY RS. 42,000/- PER PERSON. GOING BY THE SAME LOGIC, EVEN IN THE CASE OF THE 205 WORKERS WHO HAVE BEEN EXP ORTED AND WHOSE NAMES APPEAR ON PAGES 27 TO 49 OF ANNEXURE A-21 (OFFICE), ALTHOUGH NO AMOUNTS HAVE BEEN MENTIONED AGAINST THEIR NAMES, THERE WOULD BE A CONCEALMENT OF INCOME AMOUNTING TO RS. 42,000/- IT(SS)A. NO. 24/DEL/2008 20 PER PERSON. THUS FOR THESE 205 WORKERS AS APPEARING ON PAGES 29 TO 47 OF ANNEXURE A-21 (OFFICE), THERE IS A CONCEALMENT OF INCOME AMOUNTING TO RS. 86,10,000/-. SINCE 44 WORKERS HAVE BEEN EXPORTED DURING THE F.Y. 2003-04 AND REMAINING 161 WORKERS HA VE BEEN EXPORTED DURING THE F.Y. 2002-03, THE UNDISCLOSED INC OME PERTAINING TO SUCH MANPOWER EXPORTS COMES TO RS. 18,48,000/- FOR A.Y. 2004-05 (UPTO 27.5.2005) AND RS. 67,62,000/- FOR A.Y. 2003-0 4). 21. UPON ASSESSEES APPEAL LD.CIT(A) CONSIDERED THE ISSUE A ND HELD AS UNDER. SO FAR AS ADDITION OF RS. 86,10,000/- BASED ON SEIZED DOCUMENTS 29 TO 47 OF ANNEXURE A-21 IS CONCERNED, IT IS SEEN THAT IT H AS BEEN MADE ONLY ON PRESUMPTION AND SURMISES. ON PERUSAL OF THESE DOCUMEN TS IT IS FOUND THAT ALL THESE DOCUMENTS CONTAIN ONLY THE NAMES OF THE PERSONS, SPECIFIC DATES AGAINST SUCH NAMES, THE NATURE OF THEIR J OB AND IN SOME CASES PASSPORT NUMBER ETC. BUT NONE OF THEM CONTAINS ANY NUMERICAL FIGURE, AS APPEARING IN THE SEIZED DOCUMENTS NO. 17 TO 22, WHICH WOULD INDICATE ANY MONITORY TRANSACTION HAVING TAKEN PLACE . THESE DOCUMENTS NOWHERE INDICATE THAT THE APPELLANT HAD CH ARGED ANY SUM OF MONEY FROM THEM, NOT EVEN FROM SINGLE PERSON. AS A MATTER OF FACT THERE IS NO SUCH OTHER SEIZED DOCUMENT WITH THE HELP OF WHICH IT CAN BE INFERRED THAT THE SEIZED DOCUMENTS NO. 29 TO 47 ARE I N RESPECT OF SUCH PERSONS FROM WHOM THE APPELLANT HAD RECEIVED ANY MONE Y, LET ALONE RS. 42,000/- FROM EACH OF THE 205 PERSONS. THESE DOCUM ENTS HAVE TO BE READ ON THE BASIS OF WHATEVER HAS BEEN WRITTEN ON T HE FACE OF IT AND NOT BY TWISTING AND TURNING SO AS TO FIND OUT A MEANI NG WHICH THEY DO NOT EVEN REMOTELY SUGGEST. THE A.O. HAS PRESUMED THAT AS THE SEIZED PAPERS NO. 24 TO 29 OF ANNEXURE A-1 WHICH ARE THE D UPLICATE LIST OF THE IT(SS)A. NO. 24/DEL/2008 21 SEIZED PAPERS 17 TO 22 OF THE SAME ANNEXURE A-1 DO NOT CONTAIN ANY MONITORY TRANSACTION, SIMILARLY THE SEIZED DOCUMENTS 27 TO 49, THOUGH DO NOT CONTAIN ANY MONITORY TRANSACTION BUT THEY TH EMSELVES ARE THE PROOF OF MONEY HAVING BEEN RECEIVED BY THE APPELLAN T. HOWEVER, NO SUCH DUPLICATE LIST OF THE PERSONS WHOSE NAME APPEARS IN SEIZED DOCUMENT 27 TO 49 (WHICH ACTUALLY SHOULD BE 30 TO 4 9) WAS FOUND WHICH COULD SUGGEST THAT THE APPELLANT HAD RECEIVED MONEY FROM EACH OF THESE PERSONS ALSO, THAT TOO RS. 42,000/- PER PERSON. THIS IS A FAR FETCHED PRESUMPTION NOT SUPPORTED BY ANY IOTA OF EVID ENCE AND THEREFORE TO CONCLUDE THAT THE APPELLANT HAD HAD UN DISCLOSED INCOME OF RS. 86,10,000/- WAS NOT CORRECT AND IN ACCORDANCE WITH THE LAW. APPARENTLY IF THE APPELLANT HAD EARNED UNDISCLOSED IN COME TO THE EXTENT OF RS. 57,26,000/- + 86,10,000/- SUCH HUGE INC OME WOULD CERTAINLY HAVE BEEN DETECTED AS A RESULT OF SEARCH IN SOME FORM OR OTHER, EITHER IN CASH OR IN THE FORM OF BANK DEPOSIT S OR IN THE FORM OF INVESTMENT. HOWEVER, NOTHING OF THE SORT WAS UNEARTH ED AS A RESULT OF SEARCH WHICH ALSO INDICATES THAT WHAT HAS BEEN CONCLUDE D BY THE A.O. IS NOTHING BUT PRESUMPTION AND SURMISES AND HENCE ADDITI ON NOT SUSTAINABLE. BECAUSE OF THESE REASONS ADDITION OF RS. 86, 10,000/- IS HEREBY DELETED. 22. AGAINST THIS ORDER REVENUE IS IN APPEAL BEFORE US. 23. WE HAVE HEARD THE RIVAL CONTENTIONS IN LIGHT OF THE MATERIAL PRODUCED BEFORE US AND THE PRECEDENTS RELIED UPON. WE FIND IN RELEVANT SEIZED DOCUMENTS THERE IS NO MENTION WHATSOE VER THAT ASSESSEE HAS RECEIVED ANY MONEY ON ANY ACCOUNT. A SSESSING OFFICER INTERPOLATION THAT ASSESSEE HAS RECEIVED ` 42000/- EACH FROM 205 PERSONS NAMES OF WHOM IS APPEARING IN THE LIST IS BA SED ON SURMISES AND CONJECTURES. THUS, WE FIND OURSELVES FULLY IN AGREEMENT WITH THE LD. COMMISSIONER OF INCOME TAX (APPEALS) THAT THE AD DITION IS LIABLE TO IT(SS)A. NO. 24/DEL/2008 22 BE DELETED. ACCORDINGLY, WE UPHOLD THE LD. COMMISS IONER OF INCOME TAX (APPEALS)S ORDER. 24. IN THE RESULT, APPEAL BY THE REVENUE STANDS PA RTLY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 11/3/2011. SD/- SD/- [RAJPAL Y [RAJPAL Y [RAJPAL Y [RAJPAL YA AA ADAV] DAV] DAV] DAV] [SHAMIM YAHYA] [SHAMIM YAHYA] [SHAMIM YAHYA] [SHAMIM YAHYA] JUDICIAL MEMBER JUDICIAL MEMBER JUDICIAL MEMBER JUDICIAL MEMBER ACCOUNTANT MEMBER ACCOUNTANT MEMBER ACCOUNTANT MEMBER ACCOUNTANT MEMBER DATE 11/3/2011 SRB COPY FORWARDED TO: COPY FORWARDED TO: COPY FORWARDED TO: COPY FORWARDED TO: - -- - 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT (A) 5. DR, ITAT TRUE COPY BY ORDER, DEPUTY REGISTRAR, ITAT, DELHI BENCHES