Kuber Resorts Ltd., New Delhi V. ACIT, New Delhi

ITSSA 25/DEL/2011

• Counselvise Citation: [2018] 122 COUNSELVISE.COM (IT) 3579 (ITAT-DELHI)
• Duration Of Justice: 6 year(s) 8 month(s) 6 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 15-01-2018
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: D
• Next Hearing Date: 24-04-2017
• Assessment Year: misc
• Appeal Filed On: 09-05-2011
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: SHRAVAN GOTRU
• Assessee Lawyers: SUMIT GOE L
• Keywords: Unexplained investment; Document seized; Documents seized

Judgement Text

PAGE | 1 INCOME TAX APPELLATE TRIBUNAL DELHI BENCH D: NEW DELHI BEFORE SHRI H.S.SIDHU, JUDICIAL MEMBER AND SHRI PRASHANT MAHARISHI, ACCOUNTANT MEMBER IT(SS) A NO. 25/DEL/2011 (ASSESSMENT YEAR: 01/04/1987 TO 08/05/1997) KUBER RESORTS LTD, C/O. RAJ KUMAR & ASSOCIATES, CA 4435/7, ANSARI ROAD, DARYA GANJ, NEW DELHI PAN:AAACK4642B VS. ACIT, CIRCLE - 5(1), NEW DELHI (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI SUMIT GOEL, CA REVENUE BY: SHRI SHRAVAN GOTRU, SR. DR DATE OF HEARING 14/11/2017 DATE OF PRONOUNCEMENT 1 5 /01/2018 O R D E R PER PRASHANT MAHARISHI , A. M. 1. THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER OF THE LD CIT(A) - VIII, NEW DELHI DATED 10.02.2011. 2. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL IN IT(SS) A NO. 25/DEL/2011: - 1. THAT NO PROPER AND REASONABLE OPPORTUNITY OF HEARING HAS BEEN ALLOWED BY LD. AO. 2. THAT NO PROPER AND REASONABLE OPPORTUNITY OF HEARING HAS BEEN ALLOWED BY LD. CIT (A). 3. THAT UNDER THE FACTS AND CIRCUMSTANCES, THE ASSTT. ORDER IS BARRED BY LIMITATION. 4. THAT IN THE ABSENCE OF SEARCH WARRANT IN THE NAME OF M/S. KUBER RESORTS LTD., THE BLOCK ASSTT. IS WITHOUT JURISDICTION. 5. THAT UNDER THE FACTS AND CIRCUMSTANCES LD AO ERRED IN LAW AND ON MERITS AND EXCEEDED HIS JURISDICTION IN AD DING '.1,33,814/ - BEING LOSSES OF VARIOUS YEARS, WHICH WAS DIRECTED TO BE REDUCED FROM THE UNDISCLOSED INCOME BY LD CIT (A), WHICH DIRECTIONS ATTAINED FINALITY IN VIEW OF NO SECOND APPEAL FILED BY THE LD AO ON THIS ISSUE AND ALSO BECAUSE HONBLE ITAT HAS N OT DISTURBED THESE FINDINGS OF CIT KUBER RESORTS LTD VS. ACIT, IT(SS) A NO. 25/DEL/2011 (ASSESSMENT YEAR: 01/04/1987 TO 08/05/1997) (A). THE FINDINGS OF LD. CIT (A) ON THIS ISSUE ARE UNSUSTAINABLE IN LAW AND ON MERITS. 6.1. THAT UNDER THE FACTS AND CIRCUMSTANCES, AND IN VIEW OF THE DIRECTIONS OF HONBLE ITAT, THERE IS ABSOLUTELY NO JUSTIFICATION IN PR ESUMING THE UN - EXPLAINED INVESTMENT 'OR PURCHASE OF BINOLA LAND FOR '.1,00,62,779/ - (11373843 - 1311064) AND IN FURTHER PRESUMING THAT CHEQUE PAYMENT CONSTITUTES 51.73% AT '.58,83,689/ - AND CONSEQUENTLY THE BALANCE 48.27% BEING ARITHMETICALLY CALCULATED AT '.54,90,154/ - CONSTITUTES ALLEGED CASH PAYMENT AND FURTHER IN PRESUMING THAT COMPLETE CASH AND CHEQUE PAYMENTS REMAINS UN - EXPLAINED. 6.2. THAT THE LD. AO, INSPITE OF SPECIFIC DIRECTIONS OF THE HONBLE ITAT DID NOT EXAMINE THE SEIZED DOCUMENTS FROM WHERE THE ALLEGED ADVERSE INFERENCE HAS BEEN DRAWN, WHICH ADVERSE INFERENCE HAS BEEN UNDER CHALLENGE THROUGHOUT. 7. THAT UNDER THE FACTS AND CIRCUMSTANCES NO SURCHARGE SHOULD HAVE BEEN CHARGED, MORESO, SINCE DELETED BY THE LD CIT (A) AND HIS FINDINGS ATTAINED F INALITY BEING NOT CHALLENGED BEFORE HON'BLE ITAT. FURTHER, THE LD. CIT (A) FACTUALLY ERRED IN PRESUMING THAT NO SURCHARGE HAS BEEN LEVIED, CONSEQUENTLY, ERRED IN NOT LEGALLY ADJUDICATING THIS ISSUE. 8. THAT UNDER THE FACTS AND CIRCUMSTANCES NO INTEREST U/ S 220(2) SHOULD HAVE BEEN CHARGED AND WITHOUT PREJUDICE. THE CALCULATION IS ERRONEOUS AND EXCESSIVE. 3. BRIEF FACTS OF THE CASE IS THAT THE ASSESSEE IS COMPANY BELONGING TO KUBER GROUP WHICH HAS PURCHASED LAND OF MORE THAN 200 ACRE AT VILLAGE BINOLA. PURSUANT TO SEARCH AND IN RESPONSE TO NOTICE U/S 158BC ON 28.04.1998 ASSESSEE FILED NIL RETURN OF INCOME WHICH WAS ASSESSED ON 31.05.1999 AT RS. 21937566/ - . AFTER THE SERIES OF APPEALS BEFORE THE HIGHER FORUM THE ASSESSMENT WAS SET ASIDE AND REFRAMED ON 30.12.2009 AT RS. 21937566/ - . SAME WAS CHALLENGED BEFORE THE LD CIT(A) WHO PASSED ORDER ON 10.02.2011. ASSESSEE AGGRIEVED HAS FILED THIS APPEAL BEFORE US. 4. THE GROUND NO. 1 TO 4 ARE NOT PRESSED BY THE ASSESSEE AND THEREFORE, SAME ARE DISMISSED. 5. GROUND NO. 5 OF THE APPEAL IS AGAINST ADDITION OF RS. 133814/ - BEING LOSS ADDED BY THE LD ASSESSING OFFICER WHILE COMPUTING UNDISCLOSED INCOME. 6. THE BRIEF FACTS OF THIS ISSUE IS THAT PERUSAL OF THE COMPUTATION OF TOTAL INCOME FOR THE BLOCK PERIOD ASSESSEE HAS COMPUTED TOTAL I NCOME OF RS. 21803752/ - AND THE LD AO HAS REDUCED THE AMOUNT OF LOSS OF RS. 133814/ - AND THEREAFTER COMPUTED THE TOTAL INCOME AT RS. 21937566/ - . KUBER RESORTS LTD VS. ACIT, IT(SS) A NO. 25/DEL/2011 (ASSESSMENT YEAR: 01/04/1987 TO 08/05/1997) THE ASSESSEE IS AGGRIEVED BY THE SAME. THE CLAIM OF THE ASSESSEE IS THAT THE AO IN SECOND ROUND HAS COMPUTED TH E BLOCK INCOME OF RS. 21803750/ - AND ADDED THERETO THE LOSS OF RS. 133814/ - . THE LD CIT(A) DID NOT AGREE WITH THE CONTENTION OF THE ASSESSEE. 7. THE LD AR AND DR BOTH AGREED THAT THE AMOUNT OF LOSS CANNOT BE ADDED BUT IS REQUIRED TO BE SUBTRACTED . IN VIEW OF THIS WE ALLOW GROUND NO. 5 OF THE APPEAL AND DIRECT THE LD AO TO REDUCE THE SUM OF RS. 133814/ - FROM THE TOTAL INCOME. 8. GROUND NO. 6 OF THE APPEAL IS WITH RESPECT TO ADDITION OF RS. 10062779/ - AS UNEXPLAINED INVESTMENT IN PURCHASE OF BINOLA LAND. 9. THE LD AR HAS STATED THAT ITAT IN EARLIER ROUND OF ASSESSMENT DIRECTED THE LD AO TO EXAMINE THE ISSUE IN THE LIGHT OF DOCUMENTS SEIZED AND BOOKS OF ASSESSEE. HOWEVER, THE LD ASSESSING OFFICER HAS MADE THE ADDITION WITHOUT CARRYING OUT THE EXERCISE DIRECTED. HE TH EREFORE, SUBMITTED THAT MATTER NEEDS TO BE SET ASIDE TO THE LD AO FOR VERIFICATION. 10. THE LD DR ALSO SUBMITTED THAT IDENTICAL ISSUE HAS BEEN CONSIDERED BY THE COORDINATE WHERE THEY HAVE ACCEPTED THE CASH PAYMENT AND HAS SET ASIDE THE ISSUE BACK TO THE FILE OF THE LD AO FOR VERIFICATION OF SOURCE OF CASH AND CHEQUE PAYMENTS. 11. WE HAVE CAREFULLY CONSIDERED THE RIVAL CONTENTIONS AND ALSO PERUSED THE ORDERS OF THE LOWER AUTHORITIES. THE CONTENTION OF THE ASSESSEE IS THAT PAYMENT OF CHEQUES ARE FORM REGULAR BANK ACCOUNT AND CASH PAYMENTS ARE ALSO FROM THE BOOKS OF ACCOUNT. HOWEVER , IT IS APPARENT THAT BOOKS OF ACCOUNT ARE LYING WITH THE LD ASSESSING OFFICER, HOWEVER, IT WOULD ALSO NOT BE FEASIBLE FOR THE LD ASSESSING OFFICER ALSO TO VERIFY THE ABOVE DETAILS WITHOU T THE SUPPORT OF THE ASSESSEE. IN VIEW OF THIS WE DIRECT THE ASSESSEE TO SHOW THE DETAILS OF PAYMENT MADE BY THE ASSESSEE BY CHEQUE OR BY CASH FOR PURCHASES OF BINOLA LAND AND THE LD ASSESSING OFFICER EXAMINED THE SAME AND THEN DECIDE THE ISSUE AFRESH. IN VIEW OF THIS GROUND NO. 6 OF THE APPEAL OF THE ASSESSEE IS ALLOWED ACCORDINGLY. 12. GROUND NO. 7 OF THE APPEAL IS AGAINST THE LEVY OF THE SURCHARGE ON THE UNDISCLOSED INCOME OF THE ASSESSEE. KUBER RESORTS LTD VS. ACIT, IT(SS) A NO. 25/DEL/2011 (ASSESSMENT YEAR: 01/04/1987 TO 08/05/1997) 13. THE LD AR HEAVILY RELIED ON THE DECISION OF THE HON'BLE SUPREME COU RT IN CASE OF VATIKA TOWNSHIP LTD 271 CTR. 14. THE LD DR DID NOT RAISE ANY OBJECTION. HENCE, WE DIRECT THE LD ASSESSING OFFICER TO APPLY THE DECISION OF THE HON'BLE SUPREME COURT AT THE TIME OF CHARGING OF THE SURCHARGE. HENCE, GROUND NO. 7 OF THE APPEAL OF THE ASSESSEE IS ALLOWED ACCORDINGLY. 15. THE OTHER GROUNDS OF APPEAL ARE NOT PRESSED, HENCE, THEY ARE DISMISSED. 16. IN THE RESULT THE APPEAL OF THE ASSESSEE IS PARTLY ALLOWED. 17. ORDER PRONOUNCED IN THE OPEN COURT ON 15 / 01/2018 . - SD/ - - SD/ - ( H.S.SIDHU ) (PRASHANT MAHARISHI) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 15 / 01/2018 A K KEOT COPY FORWARDED TO 1. APPLICANT 2. RESPONDENT 3. CIT 4. CIT (A) 5. DR:ITAT ASSISTANT REGISTRAR ITAT, NEW DELHI