Shri Harish Patel, Bhopal V. The DCIT 1(1), Bhopal

ITSSA 36/IND/2014

• Counselvise Citation: [2019] 118 COUNSELVISE.COM (IT) 8435 (ITAT-INDORE)
• Duration Of Justice: 4 year(s) 11 month(s) 20 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 02-01-2019
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: DB
• Next Hearing Date: 15-11-2018
• Assessment Year: 2007-2008
• Appeal Filed On: 13-01-2014
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: ASHIMA GUPTA
• Assessee Lawyers: SACHIN SEXANA
• Keywords: Rejection of books of accounts; Unexplained investment; Business income; Income from undisclosed sources; Search and seizure; Loose papers; Document seized; Principle of natural justice; Block assessment; Onus to prove; Documents seized
• Section: 143(3); 153A; 145

Judgement Text

HARISH PATEL IT(SS)NOS.32 TO 38/IND/2014 1 , , IN THE INCOME TAX APPELLATE TRIBUNAL, INDORE BENCH, INDORE BEFORE HONBLE KUL BHARAT, JUDICIAL MEMBER AND HONBLE MANISH BORAD, ACCOUNTANT MEMBER IT(SS) NO.32 TO 38/IND/2014 ASSESSMENT YEARS 2003-04 TO 2009-10 REVENUE BY SMT. ASHIMA GUPTA, CIT ASSESSEE BY SHRI SACHIN SEXANA , C . A DATE OF HEARING 15 .11 . 2018 DATE OF PR ONOUNCEMENT 02 . 01.2019 O R D E R PER MANISH BORAD, AM. THE ABOVE CAPTIONED BUNCH OF SEVEN APPEALS FILED AT THE INSTANCE OF ASSESSEE PERTAINING TO ASSESSMENT YEAR 2003-04 TO 2009-10 ARE DIRECTED AGAINST THE ORDERS OF LD. COMM ISSIONER OF INCOME TAX (APPEALS)-I (IN SHORT LD.CIT(A)], BHOP AL DATED 14.10.2013 WHICH ARE ARISING OUT OF THE ORDER U/S 153C R.W.S 153A HARISH PATEL, M-31 KOTRA SULTANABAD, BHOPAL VS. D CIT RANGE - 1 (1), BHOPAL ( APPELLANT ) (RESPONDENT ) PAN NO.AFXPP1595F HARISH PATEL IT(SS)NOS.32 TO 38/IND/2014 2 R.W.S. 143(3) OF THE INCOME TAX ACT 1961(IN SHORT THE ACT) DATED 30.12.2010 FRAMED BY DCIT-1(1), BHOPAL. 2. ASSESSEE HAS RAISED FOLLOWING GROUNDS OF APPEAL; ASSESSMENT YEAR 2003-04 1. THAT THE LEARNED COMMISSIONER OF INCOME TAX ( A PPEALS) ERRED IN THE LAW AS WELL AS ON THE FACTS WHILE CONFIRMING THE AD DITION OF AGRICULTURE INCOME SHOWN BY THE APPELLANT AS INCOME FROM UNDISC LOSED SOURCES AND TREATING THE SAME AS INCOME FROM OTHER SOURCES, WHE RE IT IS SIMPLY APPROPRIATION OF PARENTAL AGRICULTURE INCOME FROM P ARENTAL LAND SITUATED AT MASAN GAON - HARDA. 2. THAT THE LEARNED COMMISSIONER OF INCOME TAX ( AP PEALS ) ERRED IN CONFIRMING FOR INVOKING THE PROVISIONS OF SECTION 1 45(3 ) OF THE INCOME TAX ACT BY MAKING HYPOTHETICAL AND ARBITRARY ESTIMATION OF THE RECEIPT BY MULTIPLYING THE TOTAL CREDITS IN THE BANK ACCOUNT B Y TWO OR THREE TIMES AND CONSIDERING THE PROFIT ON ESTIMATION BASIS WITH OUT ANY REASONABLE BASIS AND EVIDENCE BROUGHT IN TO RECORD AND ADDITIO N IN NET PROFIT IS ON MERE GUESS WORK AND THE SAME HAVE NOT ANY NEXUS WIT H THE MATERIAL ON RECORD AND THE SAME IS ON PRESUMPTION BASIS. 3. THAT THE ASSESSEE CRAVES LEAVE TO ADD / ALTER AN Y OF THE GROUNDS OF APPEAL BEFORE OR AT THE TIME OF HEARING ASSESSMENT YEAR 2004-05 1. THAT THE LEARNED COMMISSIONER OF INCOME TAX ( A PPEALS) ERRED IN THE LAW AS WELL AS ON THE FACTS WHILE CONFIRMING THE AD DITION OF AGRICULTURE INCOME SHOWN BY THE APPELLANT AS INCOME FROM UNDISC LOSED SOURCES AND TREATING THE SAME AS INCOME FROM OTHER SOURCES, WHE RE IT IS SIMPLY HARISH PATEL IT(SS)NOS.32 TO 38/IND/2014 3 APPROPRIATION OF PARENTAL AGRICULTURE INCOME FROM P ARENTAL LAND SITUATED AT MASAN GAON - HARDA. 2. THAT THE LEARNED COMMISSIONER OF INCOME TAX ( AP PEALS ) ERRED IN CONFIRMING FOR INVOKING THE PROVISIONS OF SECTION 1 45(3 ) OF THE INCOME TAX ACT BY MAKING HYPOTHETICAL AND ARBITRARY ESTIMATION OF THE RECEIPT BY MULTIPLYING THE TOTAL CREDITS IN THE BANK ACCOUNT B Y TWO OR THREE TIMES AND CONSIDERING THE PROFIT ON ESTIMATION BASIS WITH OUT ANY REASONABLE BASIS AND EVIDENCE BROUGHT IN TO RECORD AND ADDITIO N IN NET PROFIT IS ON MERE GUESS WORK AND THE SAME HAVE NOT ANY NEXUS WIT H THE MATERIAL ON RECORD AND THE SAME IS ON PRESUMPTION BASIS. 3. THAT THE ASSESSEE CRAVES LEAVE TO ADD / ALTER AN Y OF THE GROUNDS OF APPEAL BEFORE OR AT THE TIME OF HEARING ASSESSMENT YEAR 2005-06 1. THAT THE LEARNED COMMISSIONER OF INCOME TAX ( A PPEALS) ERRED IN THE LAW AS WELL AS ON THE FACTS WHILE CONFIRMING THE AD DITION OF AGRICULTURE INCOME SHOWN BY THE APPELLANT AS INCOME FROM UNDISC LOSED SOURCES AND TREATING THE SAME AS INCOME FROM OTHER SOURCES, WHE RE IT IS SIMPLY APPROPRIATION OF PARENTAL AGRICULTURE INCOME FROM PARENTAL LAND SITUATED AT MASAN GAON - HARDA. 2. THAT THE LEARNED COMMISSIONER OF INCOME TAX ( AP PEALS ) ERRED IN CONFIRMING FOR INVOKING THE PROVISIONS OF SECTION 1 45(3 ) OF THE INCOME TAX ACT BY MAKING HYPOTHETICAL AND ARBITRARY ESTIMATION OF THE RECEIPT BY MULTIPLYING THE TOTAL CREDITS IN THE BANK ACCOUNT B Y TWO OR THREE TIMES AND CONSIDERING THE PROFIT ON ESTIMATION BASIS WITH OUT ANY REASONABLE BASIS AND EVIDENCE BROUGHT IN TO RECORD AND ADDITIO N IN NET PROFIT IS ON MERE GUESS WORK AND THE SAME HAVE NOT ANY NEXUS WIT H THE MATERIAL ON RECORD AND THE SAME IS ON PRESUMPTION BASIS. HARISH PATEL IT(SS)NOS.32 TO 38/IND/2014 4 3. THAT THE ASSESSEE CRAVES LEAVE TO ADD / ALTER AN Y OF THE GROUNDS OF APPEAL BEFORE OR AT THE TIME OF HEARING ASSESSMENT YEAR 2006-07 1. THAT THE LEARNED COMMISSIONER OF INCOME TAX ( A PPEALS) ERRED IN THE LAW AS WELL AS ON THE FACTS WHILE CONFIRMING THE AD DITION OF AGRICULTURE INCOME SHOWN BY THE APPELLANT AS INCOME FROM UNDISC LOSED SOURCES AND TREATING THE SAME AS INCOME FROM OTHER SOURCES, WHE RE IT IS SIMPLY APPROPRIATION OF PARENTAL AGRICULTURE INCOME FROM P ARENTAL LAND SITUATED AT MASAN GAON - HARDA. 2. THAT THE LEARNED COMMISSIONER OF INCOME TAX ( AP PEALS ) ERRED IN CONFIRMING FOR INVOKING THE PROVISIONS OF SECTION 1 45(3 ) OF THE INCOME TAX ACT BY MAKING HYPOTHETICAL AND ARBITRARY ESTIMATION OF THE RECEIPT BY MULTIPLYING THE TOTAL CREDITS IN THE BANK ACCOUNT B Y TWO OR THREE TIMES AND CONSIDERING THE PROFIT ON ESTIMATION BASIS WITH OUT ANY REASONABLE BASIS AND EVIDENCE BROUGHT IN TO RECORD AND ADDITIO N IN NET PROFIT IS ON MERE GUESS WORK AND THE SAME HAVE NOT ANY NEXUS WIT H THE MATERIAL ON RECORD AND THE SAME IS ON PRESUMPTION BASIS. 3. THAT THE ASSESSEE CRAVES LEAVE TO ADD / ALTER AN Y OF THE GROUNDS OF APPEAL BEFORE OR AT THE TIME OF HEARING ASSESSMENT YEAR 2007-08 1. THAT THE LEARNED COMMISSIONER OF INCOME TAX ( A PPEALS ) ERRED IN CONFIRMING FOR INVOKING THE PROVISIONS OF SECTION 1 45(3 ) OF THE INCOME TAX ACT BY MAKING HYPOTHETICAL AND ARBITRARY ESTIMATION OF THE RECEIPT BY MULTIPLYING THE TOTAL CREDITS IN THE BANK ACCOUNT B Y TWO OR THREE TIMES AND CONSIDERING THE PROFIT ON ESTIMATION BASIS WITH OUT ANY REASONABLE BASIS AND EVIDENCE BROUGHT IN TO RECORD AND ADDITIO N IN NET PROFIT IS ON MERE GUESS WORK AND THE SAME HAVE NOT ANY NEXUS WIT H THE MATERIAL ON HARISH PATEL IT(SS)NOS.32 TO 38/IND/2014 5 RECORD AND THE SAME IS ON PRESUMPTION BASIS. 2. THAT THE ASSESSEE CRAVES LEAVE TO ADD / ALTER AN Y OF THE GROUNDS OF APPEAL BEFORE OR AT THE TIME OF HEARING ASSESSMENT YEAR 2008-09 1. THAT THE LEARNED COMMISSIONER OF INCOME TAX ( A PPEALS) ERRED IN CONFIRMING FOR INVOKING THE PROVISIONS OF SECTION 1 45 (3) OF THE INCOME TAX ACT BY MAKING HYPOTHETICAL AND ARBITRARY ESTIMATION OF THE RECEIPT BY MULTIPLYING THE TOTAL CREDITS IN THE BANK ACCOUNT B Y TWO OR THREE TIMES AND CONSIDERING THE PROFIT ON ESTIMATION BASIS WITH OUT ANY REASONABLE BASIS AND EVIDENCE BROUGHT IN TO RECORD AND ADDITIO N IN NET PROFIT IS ON MERE GUESS WORK AND THE SAME HAVE NOT ANY NEXUS WIT H THE MATERIAL ON RECORD AND THE SAME IS ON PRESUMPTION BASIS. 2. THAT THE LEARNED COMMISSIONER OF INCOME TAX ( AP PEALS) HAS ERRED IN INTERPRETING THE WHOLE OF THE LAND ACQUISITION TRAN SACTIONS CONSIDERING THAT THERE WAS NO CASH BALANCE AVAILABLE ON THE DATE OF PURCHASE OF LAND IS TOTALLY BASED ON WITHOUT VERIFYING THE FACTS AVAILA BLE ON THE RECORD. SUFFICIENT CASH WAS AVAILABLE IN THE BOOKS OF THE A SSESSEE ON THE DATE OF PURCHASE AS PER CASH BOOK OF THE ASSESSEE. ADDITION OF THE COST OF LAND AT KALKHEDA ON ASSUMPTION BASIS DUE TO THE DATE OF THE PURCHASE AND ACTUAL DATE OF PAYMENT DOES NOT REFLECT THE TRANSAC TION AS UNEXPLAINED INVESTMENT WHERE EVIDENCES ARE AVAILABLE ON THE REC ORD. 3. THAT THE LEARNED COMMISSIONER OF INCOME TAX (APP EALS) HAS ERRED IN TREATING RS. 34.50 LACS AS UNEXPLAINED INVESTMENT T OWARDS PURCHASE OF LAND AT MONDORI. THE AGREEMENT FOR PURCHASE OF LAND WAS NOT SIGNED BY THE OTHER PARTIES NOR IT WAS EXECUTED OR INFORCED, SINCE THE PROPOSAL WAS NOT MATERIALIZED AND ADVANCE OF RS. 6.00 LACS WAS R ETURNED AND REFLECTED IN THE BANK ACCOUNT OF THE APPELLANT. MERE ASSUMPTI ON THAT CHEQUES HARISH PATEL IT(SS)NOS.32 TO 38/IND/2014 6 MENTIONED IN THE AGREEMENT WERE ENCASHED AND DUE TO THIS CASH AMOUNT OF RS. 44,00,000/- WAS ALSO PAID IS INCORRECT. COP IES OF CONFIRMATIONS FROM ALL THE CONCERN PARTIES, AFFIRMING THE AFOREME NTIONED FACTS WERE FILED DURING PROCEEDINGS BEFORE THE LEARNED ASSESSING OFF ICER AND THE SAME WAS NOT PROVED BY THE ASSESSING OFFICER AS FALSE. H ENCE ADDITION BY ASSESSING OFFICER BASED ON EXTRANEOUS CONSIDERATION S, UNSUBSTANTIATED ON THE STRENGTH OF CORROBORATIVE EVIDENCE IS AGAINST T HE LAW OF NATURAL JUSTICE. 3. THAT THE ASSESSEE CRAVES LEAVE TO ADD I ALTER AN Y OF THE GROUNDS OF APPEAL BEFORE OR AT THE TIME OF HEARING ASSESSMENT YEAR 2009-10 1. THAT THE LEARNED COMMISSIONER OF INCOME TAX ( A PPEALS ) ERRED IN CONFIRMING FOR INVOKING THE PROVISIONS OF SECTION 1 45(3 ) OF THE INCOME TAX ACT BY MAKING HYPOTHETICAL AND ARBITRARY ESTIMATION OF THE RECEIPT BY MULTIPLYING THE TOTAL CREDITS IN THE BANK ACCOUNT B Y TWO OR THREE TIMES AND CONSIDERING THE PROFIT ON ESTIMATION BASIS WITH OUT ANY REASONABLE BASIS AND EVIDENCE BROUGHT IN TO RECORD AND ADDITIO N IN NET PROFIT IS ON MERE GUESS WORK AND THE SAME HAVE NOT ANY NEXUS WIT H THE MATERIAL ON RECORD AND THE SAME IS ON PRESUMPTION BASIS. 2 THAT THE ASSESSEE CRAVES LEAVE TO ADD / ALTER ANY OF THE GROUNDS OF APPEAL BEFORE OR AT THE TIME OF HEARING 3. AS THE ISSUES RAISED IN THESE SEVEN APPEALS ARE MOSTLY COMMON THEY WERE HEARD TOGETHER AND ARE BEING DISPO SED OFF BY THIS COMMON ORDER FOR SAKE OF CONVENIENCE AND BREVITY. HARISH PATEL IT(SS)NOS.32 TO 38/IND/2014 7 4. BRIEF FACTS OF THE CASE AS CULLED OUT FROM THE R ECORDS ARE THAT THE APPELLANT IS AN INDIVIDUAL ENGAGED IN THE BUSIN ESS OF PURCHASE AND SALE OF LAND ON COMMISSION BASIS. THE APPELLANT HAD ALSO UNDERTAKEN DEVELOPMENT WORK OF LAND AND OTHER RELAT ED CONSTRUCTION ACTIVITIES AS PROPRIETOR OF M/S NARMAD A CONSTRUCTION COMPANY. SEARCH AND SEIZURE OPERATIONS U/S 132(1) W ERE CARRIED OUT ON 30/05/2008 AT THE PREMISES OF SHRI VINOD SHA RMA AT M-31, KOTRA SULTANABAD, BHOPAL. DURING THE COURSE OF SEAR CH, CERTAIN DOCUMENTS BELONGING TO THE APPELLANT WERE ALSO FOUN D AND SEIZED. THE LEARNED ASSESSING OFFICER (IN SHORT LD.AO) IS SUED NOTICE U/S 153C ON 04/10/2010 REQUIRING THE APPELLANT TO FILE HIS RETURNS OF INCOME U/S 153C R.W.S. 153A FOR A.YS. 2003- 04 TO 2 008-09. IN RESPONSE TO THE NOTICES U/S 153C, THE APPELLANT SUB MITTED ON 25/10/2010 THAT REGULAR RETURNS FILED U/S 139(1) OF THE IT ACT FOR A. YEARS 2003-04 TO 2006-07 MAY BE TREATED AS RETURNS FILED IN RESPONSE TO NOTICES U/S 153C OF THE IT ACT. THE APP ELLANT FURNISHED RETURNS U/S 153C ON 27/12/2010 FOR A. Y 2007 -09 TO 2008-09. THE APPELLANT ALSO FURNISHED HIS REGULAR RETURN FOR A.Y. 2009-10. AFTER ISSUING NOTICES U/S 143(2) & 142(1), THE LD.A O ASSESSED THE TAXABLE INCOME OF THE APPELLANT FOR A. Y S. 2003-04 TO 2009-10. HARISH PATEL IT(SS)NOS.32 TO 38/IND/2014 8 DETAILS OF THE ORIGINAL RETURNS FILED, RETURNS FILE D U/S 153C R.W.S. 153A AND INCOME ASSESSED BY THE LD. AO CAN BE SUMMA RIZED AS UNDER: A.Y DAT E OF ORIGINAL RETURN RETURNED INCOME U/S 139(1) RETURN FILED U/S 153C SAME AS PER ORIGINAL RETURN INCOME ASSESSED (RS.) RETURNED INCOME AGRICULTURE INCOME 2003 - 04 11.10.04 20,153 71,620 1,75,909 2004 - 05 29.11.04 29,093 56,854 1,10,158 2005 - 06 30. 08.05 44,295 20,400 1,26,310 2006 - 07 19.01.07 87,825 30,410 3,73,071 2007 - 08 03.03.08 192130 - 2,99,850 44,74,011 2008 - 09 15.12.10 36075 6 - 3,60,756 68,46,898 2009 - 10 16.12.10 397516 - - 17,92,486 5. THE LD. AO STATED THAT WHEN THE DOCUMENTS BELONG ING TO THE APPELLANT FOUND DURING SEARCH WERE CONFRONTED TO TH E APPELLANT, HE ADMITTED IN STATEMENT RECORDED ON 17/06/2008 THAT T HE TRANSACTIONS WERE NOT PROPERLY RECORDED IN THE BOOK S OF ACCOUNT AND AN AMOUNT OF RS.4,OO,OOO/- FOR THE F.Y. 2007-08 RELEVANT TO ASSESSMENT YEAR 2008-09 WAS ALSO DECLARED BY THE AP PELLANT AS HIS INCOME IN ADDITION TO HIS REGULAR INCOME. HARISH PATEL IT(SS)NOS.32 TO 38/IND/2014 9 6. THE LD. AO FURTHER NOTED THAT PERUSAL OF VARIOUS DOCUMENTS SEIZED DURING THE COURSE OF SEARCH SHOWS THAT THE A PPELLANT WAS ENGAGED MAINLY IN BUSINESS OF PURCHASE AND SALE OF LAND ON COMMISSION BASIS. AGRICULTURAL LANDS WERE DEVELOPED INTO FARMS HOUSES BY THE APPELLANT ON CONTRACT BASIS AND SOLD ON COMMISSION. THE APPELLANT HAD SOLD FARM HOUSES OF SHRI VINCD SH ARMA, SHRI ANCHIT GOYAL, SHRI & SMT. JOSHI RUKMANI, KHUMAN & S HAITAN SINGH, TEJASWINI MARAN ETC. THE LD. AO OBSERVED THA T GENERALLY THE LAND WAS TAKEN FROM LAND OWNERS ON POWER OF ATTORNE Y AND SALE CONSIDERATION WAS PAID TO LAND OWNERS IN CASH OUT O F UNACCOUNTED INCOME AND ON PAPER IT WAS SHOWN THAT THE LAND HAD BEEN TAKEN ON POWER OF ATTORNEY WITHOUT ANY CONSIDERATION. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE LD. AO CONFRONTED THE A PPELLANT WITH ALL THE LOOSE PAPERS AND DOCUMENTS SEIZED DURING TH E SEARCH AND ASKED TO OFFER HIS EXPLANATION. HE WAS ALSO ASKED T O PRODUCE THOSE DOCUMENTARY EVIDENCES RELYING ON WHICH HE HAD -FILE D RETURNS OF INCOME. HE WAS FURTHER ASKED TO EXPLAIN HOW NET COM MISSION INCOME FROM SUPPLY OF BUILDING MATERIAL/PROPERTY CO NSULTANCY INCOME AND NET RECEIPT AGAINST CONSTRUCTION WORK/PE TTY CONTRACT WORK/LAND DEVELOPMENT WORK/PROFIT ON SALE OF LAND W AS ARRIVED AT HARISH PATEL IT(SS)NOS.32 TO 38/IND/2014 10 AND ALSO TO PRODUCE DOCUMENTARY EVIDENCE AVAILABLE IN RESPECT OF VARIOUS EXPENSES DEBITED IN TRADING AND PROFIT & LO SS ACCOUNT. THE LD. A.O STATED THAT THE APPELLANT HAD NOT OFFERED A NY SATISFACTORY EXPLANATION. THE APPELLANT MOSTLY RELIED ON WITHDRA WALS MADE FROM BANK ACCOUNT TO JUSTIFY THE EXPENSES AND DEPOSITS I N BANK ACCOUNT AS RECEIPTS OF BUSINESS. HOWEVER, IT WAS SEEN BY TH E LD. AO THAT THE WITHDRAWALS FROM BANK ACCOUNT WERE MADE IN CASH AND COULD NOT BE CO-RELATED WITH THE EXPENSES CLAIMED BY THE APPE LLANT. SIMILARLY, BANK DEPOSITS WERE MORE THAN THE NET RECEIPTS SHOWN BY THE APPELLANT. IT WAS EXPLAINED BY THE APPELLANT BEFORE THE LD. AO THAT NET RECEIPTS WERE LESS THAN OVER ALL DEPOSITS BECAU SE THE DEPOSITS INCLUDED MONEY RECEIVED IN ADVANCE ALSO. THE EXPLAN ATION OFFERED BY THE APPELLANT WAS NOT FOUND ACCEPTABLE BY THE LD .AO. THE LD.AO ALSO NOTICED THAT LOOSE PAPERS FOUND AND SEIZED DUR ING THE COURSE OF SEARCH INDICATE THAT THE APPELLANT WAS DOING SUBSTA NTIAL CASH TRANSACTIONS ALSO. FURTHER, DETAILS OF SUNDRY LOANS FROM RELATIVES, ADVANCE FROM CUSTOMERS AND SUNDRY EXPENSES PAYABLE SHOWN IN BALANCE SHEET WERE NOT PROPERLY EXPLAINED GIVING EX ACT DATE AND MODE OF TRANSACTIONS. IN SUCH CIRCUMSTANCES, THE LD . AO OBSERVED HARISH PATEL IT(SS)NOS.32 TO 38/IND/2014 11 THAT GROSS RECEIPTS OF BUSINESS AND PROFESSION AND NET PROFIT SHOWN IN THE RETURN CANNOT BE RELIED ON. 7. LD. A.O FURTHER CONFRONTED THE ASSESSEE THAT VAR IOUS SEIZED DOCUMENTS WHICH ALSO CONTAINED VARIOUS ENTRIES RELA TING TO RECEIPTS AND PAYMENTS IN SUBSTANTIAL FIGURES IN VARIOUS NAME S THE TOTAL OF ALL SUCH TRANSACTIONS TOTALED AROUND RS.2.70 CRORES WHICH WAS SCATTERED OVER TO 42 ENTRIES, ASSESSEE FAILED TO G IVE CONVINCING REPLY TO THE LD.A.O TO EXPLAIN THESE ENTRIES WITH THE BOO KS OF ACCOUNTS, AS A RESULT THEREOF LD.A.O REJECTED THE BOOKS OF ACCOU NTS BY INVOKING PROVISION UNDER SECTION 145(3) OF THE ACT. DUE TO SUCH UNEXPLAINED ENTRIES IN THE BANK ACCOUNT AS WELL AS VARIOUS OTHE R INCRIMINATING MATERIAL SHOWING TRANSACTIONS OF CASH, LD.A.O ESTIM ATED THE GROSS RECEIPTS AT 5 TIMES OF UNEXPLAINED ENTRIES AND THER EAFTER APPLIED NET PROFIT RATE OF 8% AND AFTER GIVING SET OFF TO THE N ET PROFIT SHOWN BY THE ASSESSEE MADE ADDITION FOR THE REMAINING AMOUNT S FOR ALL THE SEVEN ASSESSMENT YEARS. 8. LD.A.O ALSO MADE ADDITION FOR UNEXPLAINED CASH P AYMENT FOR PURCHASE OF AGRICULTURE LAND AT RS.5,00,000/- SITUA TED AT GRAM KAL KHEDA AND ALSO ADDITION FOR UNEXPLAINED CASH INVEST MENT IN LAND HARISH PATEL IT(SS)NOS.32 TO 38/IND/2014 12 DURING ASSESSMENT YEAR 2008-09 AT MINDORI FOR RS.34 .50 LAKHS. LD.A.O ALSO TREATED THE AGRICULTURE INCOME SHOWN BY THE ASSESSEE FOR ASSESSMENT YEAR 2003-04 TO 2006-07 AS INCOME FR OM OTHER SOURCE AS NO SUPPORTING DOCUMENTS FOR EARNING SUCH AGRICULTURE INCOME AS WELL AS OWNERSHIP OF THE LAND WERE FILED. ASSESSMENTS WERE ACCORDINGLY COMPLETED AFTER MAKING ABOVE ADDIT IONS IN RESPECTIVE ASSESSMENT YEARS. 9. AGGRIEVED ASSESSEE PREFERRED APPEAL BEFORE LD.CI T(A) AND PARTLY SUCCEEDED. 10. NOW BEFORE US THE ASSESSEE IS IN APPEAL FOR ALL THE SEVEN ASSESSMENT YEARS RAISING VARIOUS GROUNDS OF APPEAL BUT THE COMMON ISSUE EMANATING OUT OF THESE GROUNDS ARE AS FOLLOWS; (I). AS REGARDS ASSESSMENT YEAR 2003-04 TO 2009-10 ASSESSEE HAS COMMONLY CHALLENGED THE ACTION OF THE LD.A.O INVOKING THE PROVISION OF SECTION 145(3) OF THE ACT THEREBY REJECTING BOOKS OF ACCOUNTS AND ALSO CHALLENGING TH E FINDING OF LD.CIT(A) SUSTAINING THE ADDITION OF TWICE/THRICE O F GROSS RECEIPTS AS WELL AS APPLICATION OF NET PROFIT RATE ON SUCH ESTIMATED RECEIPTS. HARISH PATEL IT(SS)NOS.32 TO 38/IND/2014 13 (II) CHALLENGING THE TREATMENT OF AGRICULTURE INCOM E AS INCOME FROM OTHER SOURCES FOR ASSESSMENT YEAR 2006-07. (III) CHALLENGING THE ADDITION OF UNEXPLAINED INVES TMENT FOR PURCHASE OF AGRICULTURE LAND AT GRAM KAL KHEDA AT RS.5,00,000/-. (IV) CHALLENGING THE UNEXPLAINED CASH INVESTMENT OF RS.34.50 LAKHS FOR LAND AT MINDORI. 11. WE WILL FIRST TAKE UP THE COMMON ISSUE CHALLENG ING THE REJECTION OF BOOKS OF ACCOUNTS, INVOKING PROVISION OF SECTION 145(3) OF THE ACT AS WELL AS ESTIMATION OF GROSS RECEIPTS AND ESTIMATION OF NET PROFIT. 12. LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT LD. CIT - APPEAL/LEARNED ASSESSING OFFICER HAS WRONGLY INVOKE D THE PROVISIONS OF SECTION 145(3) OF THE INCOME TAX ACT BY MAKING HYPOTHETICAL AND ARBITRARY ESTIMATION OF THE RECEIP TS AND PROFITS ON A VERY HIGHER SIDE BY JUST MULTIPLYING THE BANK DEP OSITS BY 5,3,2 TIMES WITHOUT ANY REASONABLE BASIS AND EVIDENCE BRO UGHT IN TO RECORD. IT IS CLEAR THAT SECTION 145 OF THE IT ACT 1961 , ONLY PROVIDES HARISH PATEL IT(SS)NOS.32 TO 38/IND/2014 14 THE BASIS ON WHICH COMPUTATION OF INCOME IS TO BE M ADE FOR THE PURPOSE OF DETERMINING THE AMOUNT OF TAX . THE PROV ISIONS BY ITSELF DO NOT DEAL WITH UNSUBSTANTIATED ADDITIONS TO BE MA DE ON PRESUMPTIONS. 13. LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED TH AT IT IS A WELL SETTLED LAW AS PER SUPREME COURT IN ITS DECISION IN 219 ITR 330 (SC) THAT THERE CANNOT BE TAX ON INCOME ON PRESUMPT IVE BASIS. INCOME IN FACT EARNED IS ONLY TAXABLE AND NOT THE O NE PRESUMED TO HAVE BEEN EARNED. IT IS TRITE LAW THAT IF AN INCO ME IS TO BE ASSESSED IN THE HANDS OF ASSESSEE, THE BURDEN TO ESTABLISH T HAT SUCH INCOME IS CHARGEABLE TO TAX, IS ON ASSESSING OFFICER. NO A DDITION CAN BE CALLED FOR ON THE BASIS OF DUMB DOCUMENTS. IT IS ON THE DEPARTMENT TO SUPPLY LANGUAGE TO DUMB DOCUMENTS, SUBSTANTIATED ON THE STRENGTH OF EVIDENCE. REC ORD ITSELF EVIDENCES THE FACT THAT DESPITE DEEP SCRUTINY OF TH E BOOKS OF ACCOUNT WITH REFERENCE TO THE SEIZED DOCUMENTS, THE ASSESSING OFFICE WAS NOT IN A POSITION TO IDENTIFY, SPECIFY A ND QUANTIFY THE EXACT AMOUNT OF UNRECORDED RECEIPTS AND OPTED ESTIM ATION OF THE RECEIPTS AT FIVE TIMES OF THE BANK DEPOSITS AND CON SIDERED 8 % NET PROFIT WHICH COULD NOT BE SUBSTANTIATED AND CO-RE LATED WITH THE HARISH PATEL IT(SS)NOS.32 TO 38/IND/2014 15 MATERIAL EVIDENCE FOUND / SEIZED DURING SEARCH. MER E GUESS WORK / ESTIMATION OF THE RECEIPTS AND NET PROFIT DID NOT H AVE NEXUS WITH THE MATERIAL ON RECORD. THE ASSESSING OFFICER HAD N OT GIVEN OPPORTUNITY TO THE ASSESSEE TO CONTRADICT THE MATER IAL, IF ANY UPON WHICH HE BASED HIS ESTIMATE AND NO OPPORTUNITY WAS GIVEN TO THE ASSESSEE FOR THE SAME WHICH IS CLEAR VIOLATION OF T HE MANDATORY REQUIREMENT OF LAW. LD. ASSESSING OFFICER SHOULD HA VE DILIGENTLY MADE A MEANINGFUL EXERCISE TO SURFACE THE INSTANCES OF SUPPRESSION IN THE SALES / RECEIPTS OR INFLATION IN PURCHASE / EXPENSES AS ALSO THE UNDISCLOSED INVESTMENT MADE BY THE ASSESSEE IF ANY AND SHOULD HAVE ALSO APPRAISED THE ASSESSEE WITH THE JUSTIFICA TION FOR REJECTION OF THE BOOKS FOR INVOKING PROVISIONS OF SECTION 145 (3). IT IS A WELL SETTLED LAW THAT UNDISCLOSED INCOME ASSESSED IF ANY MUST INVARIABLY BE MATCHED WITH THE UNRECORDED ASSETS FOUND/SEIZED DURING SEARCH, HENCE ESTIMATION OF RECEIPTS BY 5,3,2 TIMES OF BANK ING AND CONSIDERING 8% AS NET PROFIT OR ACTUAL PERCENTAGE O F NET PROFIT IS BAD IN THE EYES OF LAW OF JUSTICE. CONSIDERING THE NATURE OF BUSINESS OF THE ASSESSEE AND BANKING AND OTHER RELA TED RECORD ESTIMATION OF SUCH HUGE RECEIPT AND NET PROFIT IS V ERY EXCESSIVE AND AGAINST THE LAW OF THE NATURAL JUSTICE. HARISH PATEL IT(SS)NOS.32 TO 38/IND/2014 16 14. LD. COUNSEL FOR THE ASSESSEE FURTHER REFERRING TO ITS GROUND CHALLENGING THE REJECTION OF BOOK RESULTS AND INVOK ING PROVISIONS OF SECTION 145(3) OF THE ACT MADE FOLLOWING WRITTEN SU BMISSIONS; 1. HON'BLE CIT-APPEAL/LEARNED ASSESSING OFFICER HA S WRONGLY INVOKED THE PROVISIONS OF SECTION 145(3) OF THE INCOME TAX ACT BY MAKING HYPOTHETICAL AND ARBITRARY ESTIMATION OF THE RECEIPTS AND PROFIT S ON A VERY HIGHER SIDE BY JUST MULTIPLYING THE BANK DEPOSITS BY 5,3,2 TIMES A ND CONSIDERING NET PROFIT ON ASSUMPTION BASIS OF THE ESTIMATED RECEIPTS WITHO UT ANY REASONABLE BASIS AND EVIDENCE BROUGHT IN TO RECORD BY MAKING ASSUMPT ION THAT BANK ACCOUNT ARE JUST LIKE TIP OF THE ICE BERG IN THE OC EAN OF THE BUSINESS TRANSACTIONS OF THE ASSESSEE. IT IS CLEAR THAT SECT ION 145 OF THE IT ACT 1961, ONLY PROVIDES THE BASIS ON WHICH COMPUTATION OF INC OME IS TO BE MADE FOR THE PURPOSE OF DETERMINING THE AMOUNT OF TAX. THE P ROVISIONS BY ITSELF DO NOT DEAL WITH UNSUBSTANTIATED ADDITIONS TO BE MADE ON PRESUMPTIONS. HON'BLE CIT APPEAL HAS CONSIDERED THE SAME AS TWICE OF THE BANK DEPOSITS AND CONSIDERED THE SAME AMOUNT OF GROSS PROFIT IN A .Y 2003-2004 TO 2008- 2009 AND IN 2009-2010 CONSIDERED AS THREE OF THE BA NK DEPOSITS. 2. THAT THE ORDER OF THE HON'BLE ASSESSING OFFICER IS BAD IN LAW AS WELL AS ON FACTS AS THERE ARE VIOLATION OF THE VARIOUS MAND ATORY REQUIREMENT OF LAW. ASSESSEE IS A REGULAR INCOME TAX PAYEE AND REG ULARLY FILING INCOME TAX RETURN AND NECESSARY BOOKS OF ACCOUNTS ARE MAIN TAINED BY THE ASSESSEE IN SUCH A WAY TO ASSESS THE INCOME FOR THE VARIOUS ASSESSMENT YEAR UNDER BLOCK ASSESSMENT AND MOST OF THE TRANSAC TIONS ARE ROUTED THROUGH BANK ACCOUNT OF THE ASSESSEE AS PER COPY OF INCOME TAX RETURN AND BANK STATEMENT / BANK BOOK PROVIDED TO THE LEAR NED ASSESSING OFFICER ALONG WITH COMPUTATION OF THE TOTAL INCOME WITH COP Y OF FINAL ACCOUNT OF THE BUSINESS FOR THE RESPECTIVE YEARS. 3. IT IS TRITE LAW THAT IF AN INCOME IS TO BE ASSES SED IN THE HANDS OF ASSESSEE THE BURDEN TO ESTABLISH THAT IS SUCH INCOME CHARGEA BLE TO TAX IS ON ASSESSING OFFICER. NO ADDITION CAN BE CALLED FOR ON THE BASIS OF DUMP DOCUMENTS! IT IS ON THE DEPARTMENT TO SUPPLY LANGUA GE TO DUMP DOCUMENTS! SUBSTANTIATED ON THE STRENGTH OF EVIDENC E. WHERE AS IN THIS CASE THE LEARNED ASSESSING OFFICER HAS MADE ADDITION IN RETURNED INCOME ON THE GROUND THAT VARIOUS LOOSE PAPERS AND DOCUMENTS SEIZ ED DURING THE SEARCH RELATED WITH ASSESSEE WITHOUT THE REASONABLE JUSTIF ICATION. ASSESSEE DEALS WITH COMMISSION INCOME FROM SALE/SUPPLY OF BUILDING MATERIAL/LAND IN HARISH PATEL IT(SS)NOS.32 TO 38/IND/2014 17 THE FORM OF PLOT/FARM LAND WITH OR WITHOUT DEVELOPM ENT/CONSTRUCTION PETTY CONTRACT BASIS. DUE TO THE NATURE OF THE BUSINESS M OST OF THE FARMERS, LAND OWNERS, BUILDING MATERIAL SUPPLIERS / CONSTRUCTION RELATED PARTIES / BROKERS USED TO COME AT THE ASSESSEE OFFICE, SOME TIME LEAV ES PROPERTY PAPERS AT ASSESSEE OFFICE FOR FURTHER PROJECTS, DISCUSSIONS, PROPOSED SALE PROSPECTS OR FOR SELLING THE SAME ON COMMISSION BASIS TO OUTSIDE PARTIES . IN CASE OF SALE ON COMMISSION BASIS THROUGH POWER OF ATTORNEY WITHO UT CONSIDERATION FROM THE LAND OUT OF THE TIMES SALE CONSIDERATION DIRECT LY RECEIVED BY THE ASSESSEE AND THEY ROUTED TO THE LAND OWNER ON ACCOU NT OF THE PURCHASE PRICE. 4. IT IS A WELL SETTLED LAW AS PER SUPREME COURT IN ITS DECISION IN 219 ITR 330(SC) THAT THERE CANNOT BE TAX ON INCOME ON PRESU MPTIVE BASIS. INCOME IN ACT EARNED IS ONLY TAXABLE AND NOT THE ONE PRESU MED TO HAVE BEEN EARNED. HON'BLE CIT - APPEAL / LEARNED ASSESSING OF FICER HAS CONSIDER VARIOUS PAPERS IN WHICH THERE IS NO MONETARY TRANSA CTIONS INVOLVED AS UNACCOUNTED PART OF THE BUSINESS, WHICH IS TOTALLY UNJUSTIFIED AT THE END OF THE ASSESSEE . AS ASSESSEE ENGAGED IN CONSTRUCTION WORK AND DEVELOPMENT WORK FOR VARIOUS LAND OWNERS. LEARNED ASSESSING OFF ICER HAS CONSIDERED VARIOUS NON MONETARY ITEMS AS UNACCOUNTED PART OF T HE BUSINESS WHICH HAS NO RELEVANCE WITH THE BUSINESS OF THE ASSESSEE LIKE LAND PAPERS OF THE PANCH SEWA GRAHA NIRMAN SANSTHA . SO MANY CONTRACTO RS COMES TO THE ASSESSEE PREMISES JUST FOR THE SAKE OF DISCUSSION O N VARIOUS MATTER WITH PREPARATION OF THE PROJECT REPORTS . THE SAME HAS A LREADY BEEN EXPLAINED TO THE ASSESSING OFFICER ON THE VARIOUS DATES OF HEARI NG AND THERE WAS NO MONETARY TRANSACTIONS INVOLVED IN THIS AS IN THESE PAPERS / DOCUMENTS , THERE IS NO CORRELATION WITH THE ASSESSEE NOR ANY M ONETARY TRANSACTIONS ARE INVOLVED IN THIS. 5. AS DUE TO THE NATURE OF THE BUSINESS VARIOUS PRO POSALS ARE COMES TO THE ASSESSEE TO .EITHER SALE THE LAND FROM THE LAND OWN ER DIRECT TO THE THIRD PARTY OR SALE THE LAND AFTER GETTING DEVELOPMENT ON IT OR DO THE PLOTTING WORK ON THE LAND AFTER DUE DEVELOPMENT OR SALE THE LAND IN THE FORM OF FARM LAND AFTER GETTING DEVELOPMENT OR CONSTRUCTING A COLLEGE ON THE LAND OR CONSTRUCTION OF THE DUPLEX HOUSE ON THE LAND AFT ER DEVELOPMENT. ALL THESE OPTIONS ARE PREPARED FOR SOME OF THE LAND AND DUE TO THIS VARIOUS SURVEY AND ANALYSIS REPORTS ARE PREPARED BY THE ASS ESSEE OR VARIOUS BROKERS USED TO COME TO THE ASSESSEE OFFICE FOR SALE OF THE IR LAND AT VARIOUS PLACES AND MAINLY AT NEELBAD, RATIBAD . AS THESE LOOSE PAP ERS ARE OBTAINED DURING SEARCH AT THE ASSESSEE PREMISES BUT IN THESE PAPERS THERE ARE NO FINANCIAL TRANSACTION ARE INVOLVED ON ACCOUNT OF THE ASSESSEE , HENCE CONSIDERING THE SAME AS BUSINESS TRANSACTIONS OR UNACCOUNTED PART O F THE BUSINESS ACTIVITY ARE NOT JUSTIFIED. 6. IN MOST OF THE CASES REASONABLE EXPLANATIONS OFF ERED BY THE ASSESSEE AT HARISH PATEL IT(SS)NOS.32 TO 38/IND/2014 18 THE TIME OF HEARING WITH THE SATISFACTION OF THE LE ARNED ASSESSING OFFICER AS DUE TO THE NATURE OF THE BUSINESS OF THE ASSESSEE, SO MANY FARMERS, LAND OWNERS, BROKER, FARM HOUSE OWNERS AND CONTRACTORS U SED TO COME TO THE ASSESSEE OFFICE FOR THE SALE OR PURCHASE OF THEIR L AND / PLOT / FARM HOUSE / FARM LAND IN SOME TIMES FOR COMPLETION OF ALL THE L EGAL FORMALITIES OF THE TRANSFER OF THE LAND OR GETTING BAHI / RIN PUSTIKA / KHASRA / KHATONI AS ASSESSEE IS HAVING GOOD KNOWLEDGE OF THE LEGAL/PROC EDURAL REQUIREMENT FOR REAL ESTATE TRANSFER RELATED PROCEDURE / ACQUISITIO N OF THE LAND TITLE RELATED PAPERS FROM TEHSIL OFFICE AND DUE TO THIS MOST OF T HE PAPERS / TITLE DEEDS WERE OBTAINED DURING THE SEARCH IN WHICH THERE IS N O MONETARY INVOLVEMENT ON ACCOUNT OF THE ASSESSEE IN SOME CASES THERE IS N O NAME OF THE ASSESSEE MENTIONED IN THE RELATED PAPERS EVEN THOUGH THE SAM E HAS BEEN ADDED AS UNACCOUNTED PART OF THE BUSINESS OF THE ASSESSEE IS NOT CORRECT AND AGAINST THE LAW OF NATURAL JUSTICE , EVEN THOUGH ASSESSEE H AS EXPLAINED THE SAME THROUGH THEIR WRITTEN SUBMISSION IN THIS REGARD TO THE LEARNED A.O DURING HEARING. RECORD ITSELF EVIDENCES THE FACT THAT DESPITE DEEP SCRUTINY OF THE BOOKS OF ACCOUNT WITH REFERENCE TO THE SEIZED DOCUMENTS, THE ASSESSING OFFICER WAS NOT IN A POSITION TO IDENTIFY, SPECIFY AND QUANTIFY THE EXACT AMOUNT OF UNRECORDED RECEIPTS AND OPTED ESTIMATION OF THE REC EIPTS AT FIVE TIMES OF THE BANK DEPOSITS AND CONSIDERED 8% NET PROFIT WHICH CO ULD NOT BE SUBSTANTIATED AND CO-RELATED WITH THE MATERIAL EVID ENCE FOUND / SEIZED DURING SEARCH. ASSESSING OFFICER HAS PRESUMED EXCES SIVELY HIGH TURNOVER OF THE ASSESSEE WHICH IS AWAY FROM THE PRACTICALITY, W ITHOUT CONSIDERING THE NATURE OF THE BUSINESS, NECESSARY EXPLANATION OFFER ED , NECESSARY PAPERS AND SUBMISSIONS 'OFFERED TO THE ASSESSING OFFICER W ITH NECESSARY SUPPORTING / EVIDENCES. / CONFIRMATIONS , LEARNED ASSESSING OF FICER HAS PRESUMED THAT THE ACTUAL TRANSACTION OF THE ASSESSEE IS 5 TIMES O F THE BANKING OF THE ASSESSEE. LEARNED ASSESSING OFFICER HAS NO REASONAB LE CAUSE FOR SUCH ESTIMATION EXCEPT THAT ASSESSEE DEALS WITH PROPERTY / REAL ESTATE AND THEIR SOME OF THE BUSINESS TRANSACTIONS ARE IN CASH, BUT LEARNED ASSESSING OFFICER HAS ASSUMED BASED ON SOME PAPERS THAT BANKI NG OF THE ASSESSEE IS ONLY LIKE TIP OF ICE BERG IN THE OCEAN, WHICH IS A MERE ASSUMPTION OF THE ASSESSING OFFICER, WHICH IS NOT REASONABLE AND JUST IFIABLE WITHOUT ANY SUFFICIENT CAUSE AND ESTIMATING TURNOVER AS 5 TIME OF THE BANKING IS HIGHLY EXCESSIVE AND HYPOTHETICAL CONSIDERING THE SUBMISSI ONS / DOCUMENTARY EVIDENCE / EXPLANATIONS / OTHERS. LEARNED ASSESSING OFFICER HAS ERRONEOUSLY ESTIMATED NET PROFIT @ 8 % OF THE GROSS RECEIPT ASS UMING THAT ALL EXPENSES HAVE ALREADY BEEN ALLOWED. IT IS MERE A HYPOTHECATI ON OF THE LEARNED ASSESSING OFFICER THAT TOTAL RECEIPT OF THE ASSESSE E IS 5 TIMES OF THE BANKING OF THE ASSESSEE AND ESTIMATING 08 % OF THE GROSS RECEIPT AS INCOME IS HIGHLY EXCESSIVE CONSIDERING THE EARNING OF' A LAND BROKER / PETTY CONTRACTOR FOR DEVELOPMENT WORK OR OTHER RELATED BU SINESS . PRESUMPTION / ESTIMATION IS WRONG AND AGAINST THE LAW OF NATURAL JUSTICE. HON'BLE CIT ~ HARISH PATEL IT(SS)NOS.32 TO 38/IND/2014 19 APPEAL HAS CONSIDERED THE SAME AS 2 TIMES OF BANK D EPOSITS AND CONSIDER THE PROFIT SAME AS MENTIONED BY THE APPELLANT IN TH E RESPECTIVE ASSESSMENT YEAR EXCEPT TREATED AS 3 TIMES ON A.Y 2009-2010. MO ST OF THE TRANSACTIONS OF THE ASSESSEE ARE ROUTED THROUGH BANKING ON ACCOU NT OF THE SALE OF THE LAND OWNED BY THE ASSESSEE AND IN CASE OF SALE THRO UGH POWER OF ATTORNEY OR ON COMMISSION BASIS, CASH / CHEQUE / DD RECEIVED AG AINST THE SALE OF THE LAND EITHER DIRECTLY GIVEN TO THE SELLER ( LAND OWN ER ) OR ROUTED THROUGH ASSESSEE BANK ACCOUNT . IN CASE OF CASH RECEIVED ON SALE OF THE LAND / PLOT / FARM HOUSE SAME IS DEPOSITED IN TO THE BANK ACCOU NT OF THE ASSESSEE AND SUBSEQUENTLY ISSUED THE CHEQUE TO THE LAND OWNER AF TER DEDUCTING COMMISSION / DEVELOPMENT CHARGES ON SUCH SALE, AS M OST OF THE TRANSACTIONS OF SALE OR PURCHASE OF LAND ARE ROUTED THROUGH VARIOUS BANK ACCOUNT OF THE ASSESSEE DUE TO WHICH BANKING OF THE ASSESSEE REFLECTS AS FOLLOWS: ASSESSMENT YEAR TOTAL ACTUAL BANKING TOTAL SALE OF LAND 2003-2004 400940/- ONLY PETTY CONTRACT WORK 2004-2005 266560/- ONLY PETTY CONTRACT WORK 2005-06 394570/- ONLY PETTY CONTRACT WORK 2006-2007 992990/- ONLY PETTY CONTRACT WORK CONSTRUCTION WORK COMMISSION INCOME 2007-2008 11435028/- SALE OF LAND OF SHRI. VINOD SHARMA ANCHIT GOYAL RS.101.95/- LACS WITH DEVELOPMENT PETTY CONTRACT WORK / COMMISSION INCOME 2008-2009 7492244/- SALE OF LAND OF SHRI. VINOD ANCHIT GOYAL, TEJAS WANI MARAN,RUKMANI, KHUMAN SHETAN SINGH MARAN , ALAY JOSHI RS. 64.30/- LACS/OTHER DEVELOPMENT WORK HARISH PATEL IT(SS)NOS.32 TO 38/IND/2014 20 2009-2010 4731214/- SALE OF LAND OF SH RI. VINOD SHARMA, ANCHIT GOYAL RS.25 LACS/ DEVELOPMENT WORK/PETTY CONTRACT WORK. WHERE AS ASSESSING OFFICER HAS CONSIDER THE TURNOVE R OF THE ASSESSEE FOR THE LAST SEVEN YEARS AS FOLLOWS: ASSESSMENT YEAR TURNOVER IN RUPEES TURNOVER I N RUPEES AS AS PER A.O PER CIT-A A.Y - 2003-2004 RS.02004700/- RS. 801880/- A.Y - 2004-2005 RS.01332800/- RS. 533120/- A.Y - 2005-2006 RS.01972850/- RS.789140/- A.Y - 2006-2007 RS. 04964950/- RS. 1985980/- A.Y - 2007-2008 RS. 57175140/- RS.22870056/- A.Y - 2008-2009 RS.37461220/- RS. 14984488/- A.Y - 2009-2010 RS.23656070/- RS. 8038410/- IN THE YEAR OF APPEAL - TURNOVER OF THE ASSESSEE IS ASSUMED ON PRESUMPTION BASIS WHICH IS BEING A PROPERTY DEALER/ BROKER/ CIVIL CONTRACTOR IS VERY HIGH AND BEYOND THE LIMIT OF HYP OTHECATION . AS PER THE LAW OF JUSTICE , IT CAN BE TWICE OF THE BANKING OF THE ASSESSEE IN ALL THE ASSESSMENT YEAR IF ASSUMPTION THUMB RULE IS APPLIED BY THE HON'BLE CIT - APPEAL OR LEARNED ASSEESSING OFFICER , BUT LEARNED ASSESSING OFFICER HAS MADE SUCH IMAGINATION OF TURN OVER BY WAY OF MAKING WRONG ANALYSIS OF THE TURNOVER OF THE ASSESS EE, WHICH IS ARBITRARY, ILLEGAL,, CONTRARY TO THE LAW OF JUSTICE AND APPLIED SAME PERCENTAGE OF PROFIT AS SHOWN BY THE ASSESSEE IN T HE VARIOUS ASSESSMENT YEARS IN HIS RETURN OF INCOME. AS THE ABOVE DETAILS EXPLAINS THAT THE MAXIMUM BANK ING OF THE ASSESSEE IS NOT ON HIGHER SITE IN WHICH MAXIMUM FARM HOUSE A RE SOLD BY THE ASSESSEE ON COMMISSION BASIS / DEVELOPMENT BASIS AN D MOST OF THE TRANSACTIONS ARE R:OUTED THROUGH VARIOUS BANK ACCOU NTS PER THE BANK BOOK / CASH BOOK SUBMITTED TO THE LEARNED ASSESSING OFFICER, EVEN THOUGH PER HONBLE CIT-APPEAL/LEARNED AO HAS ASSUMED TURNOVER ON ASSUMPTION BASIS AS 5, 3.2 TIMES OF THE TOTAL TRANS ACTIONS AS MOST OF HARISH PATEL IT(SS)NOS.32 TO 38/IND/2014 21 THE TRANSACTIONS ARE ROUTED THROUGH BANK COUNT. BAN KING OF THE ASSESSEE SHOWS THAT ALL THE SALE OF THE LAND / FARM , LAND ARE DIRECTLY ROUTED THROUGH THE BANK ACCOUNT OF THE ASSESSEE , H ENCE THERE IS NO EXCESSIVE OR HIDDEN CASH TRANSACTIONS INVOLVED IN THE BUSINESS OF THE ASSESSEE AND AS PER THE DETAILS OF THE SALE OF THE VARIOUS LAND SUBMITTED TO THE LEARNED ASSESSING ON COMMISSION BA SIS ( FARMING PART THE GROUND OF APPEAL) REVEALS THAT THERE IS NO SUBS TANTIAL CASH TRANSACTIONS INVOLVED IN THE BUSINESS OF THE ASSESS E , HENCE CONSIDERING 5 TIME OF THE BANKING OR 2 TIMES OF BANKING AS GROS S RECEIPT IS TOTALLY WRONG AND ESTIMATING 8 % OF THE INCOME OR SAME PERC ENTAGE OF PROFIT ON HYPOTHETICAL BASIS IS ALSO AGAINST THE LAW OF THE J USTICE AND SUCH A ASSUMPTION IS HIGHLY EXCESSIVE AS IN MOST OF THE CA SES ASSESSEE SOLD THE LAND / PART OF THE LAND ONLY ON COMMISSION BASIS WH ICH IS AROUND 2 % OF THE SALE PRICE OF THE LAND , WHERE AS LEARNED AS SESSING OFFICER HAS ESTIMATED THE SAME @ 8 % OR SIMILAR PERCENTAGE AS S HOWN IN THE RETURN, WHICH ASSUMED THAT ALL THE EXPENSES HAVE ALREADY BE EN ALLOWED IS TOTALLY NOT ETHICAL AND ARBITRARY IN NATURE AS WELL AS AGAI NST THE LAW OF THE NATURAL JUSTICE AS THERE IS NO SUCH BUSINESS WHERE NET PROFIT IS 8 % OF THE GROSS RECEIPT. HENCE ADDITION OF THE DIFFERENCE OF THE ESTIMATED INCOME AND ACTUAL INCOME IS ILLEGAL , UNEXPLAINED A ND AGAINST THE LAW OF JUSTICE. 7. AT THE TIME OF HEARING ASSESSEE HAS SUBMITTED TH E DETAILS OF THE LAND / PART OF THE LAND / PLOT / FARM LAND SOLD DURING E ACH OF THE YEAR UNDER BLOCK ASSESSMENT ALONG WITH THE PHOTOCOPIES OF THE TITLE DEEDS OF THE LAND SOLD DIRECT OR ON COMMISSION BASIS FOR THE YEA R ALONG WITH THEIR SOURCE OF PURCHASE AND SALE CONTRIBUTION RECEIVED D URING THE YEAR AND NON OF THE OTHER REGISTRY OF LAND OBTAINED DURING S EARCH AT THE ASSESSEE PREMISES , WHICH CAN BE TREATED AS UNDISCL OSED PROPERTY OR LAND WHICH HAS NOT BEEN TAKEN IN TO THE ACCOUNT . A SSESSEE HAS GIVEN A DETAILED CHART OF THE LAND OWNED BY THE ASSESSEE AN D SALE OF THE LAND IN PIECE TO VARIOUS PARTIES ALONG WITH THEIR MODE O F PAYMENT FROM THE BUYER AND SELLER ( AS PER DETAILS OF THE LAND / SAL E OF THE LAND DURING THE YEAR UNDER BLOCK ASSESSMENT ENCLOSED) WITH COST OF DEVELOPMENT / COMMISSION RECEIVED / PAID ON THEM ALONG WITH ALL T HE BANK STATEMENTS / BANK BOOK / CASH BOOK. APART FROM THEM THERE ARE NO HIDDEN TRANSACTIONS OR SUBSTANTIAL RECEIPT DURING ANY OF T HE FINANCIAL YEAR WHICH JUSTIFIES THAT ASSESSEE IS HAVING 5 TIMES CASH TRAN SACTIONS OVER AND ABOVE THE BANK TRANSACTIONS IN ANY OF THE FINANCIAL YEAR, H NEE FOR ESTIMATING PROFIT IN THE BLOCK ASSESSMENT YEARS JUS T BY MULTIPLYING 5 TIMES , 2 TIMES OR 3 TIMES OF THE BANKING OF THE AS SESSEE AND OPTING ASSUMPTION RATE OF PROFIT AS NET INCOME IS TOTALLY WRONG AND AGAINST THE LAW OF THE NATURAL JUSTICE. 8. MERE GUESS WORK / ESTIMATION OF THE RECEIPTS AND NET PROFIT DID NOT HARISH PATEL IT(SS)NOS.32 TO 38/IND/2014 22 HAVE NEXUS WITH THE MATERIAL ON RECORD. THE ASSESSI NG OFFICER HAD NOT GIVEN OPPORTUNITY TO THE ASSESSEE TO CONTRADICT THE MATERIAL, IF ANY UPON WHICH HE BASED HIS ESTIMATE AND NO OPPORTUNITY WAS GIVEN TO THE ASSESSEE FOR THE SAME WHICH IS CLEAR VIOLATION OF T HE MANDATORY REQUIREMENT OF LAW. ASSESSEE HAS PROVIDED ALL THE N ECESSARY DETAILS ALONG WITH DETAILED QUESTIONNAIRE OF THE DEPARTMENT DATED 25.10.2010 AND SUBMISSION OF THE SAME ON THE VARIOUS DATES OF HEAR ING , THERE WAS NO SUCH PROPERTY INFORMATION OBTAINED BY THE DEPARTMEN T FROM VARIOUS SOURCES WHICH HAS NOT BEEN TAKEN IN THE BOOKS OF TH E ASSESSEE IN ANY OF THE PREVIOUS YEAR OR NOT SHOWN IN THE INCOME TAX RE TURN OF THE ASSESSEE IN ANY OF THE PREVIOUS YEARS UNDER BLOCK ASSESSMENT , HENCE CONSIDERING THE ESTIMATED RECEIPTS JUST BY MULTIPLYING IT BY FI VE TIMES OF THE BANK TRANSACTION IS UNETHICAL AND UNJUSTIFIED. ESTIMATIO N OF THE NET INCOME OF THE ASSESSEE @ 8 % OF THE ESTIMATED RECEIPTS BY MAK ING WRONG INTERPRETATION OF THE LOOSE PAPERS AND OTHER PAPERS EVEN AFTER SUBMISSIONS OF THE NECESSARY EXPLANATIONS AND DOCUM ENTARY EVIDENCES AVAILABLE WITH THE ASSESSING OFFICER OR PROVIDED BY THE ASSESSEE AT THE TIME OF HEARING OF THE CASE. AS ASSESSEE IS A BROKE R OF THE LAND ALONG WITH HAVING SOME LAND IN THEIR INDIVIDUAL NAME PURC HASED DIRECTLY WITH THE REGISTERED SALE DEED BY MAKING PAYMENT IN PART OR IN FULL OUT OF THEIR TAXABLE INCOME OR FROM THE JUSTIFIES SOURCE O F PAYMENT. IN CASE OF SALE ON COMMISSION BASIS , SOMETIMES POWER OF ATTOR NEY IS OBTAINED BY THE ASSESSEE FOR THE SUBSEQUENT SALE WITHOUT OUT CO NSIDERATION BECAUSE IT IS NOT PRACTICALLY POSSIBLE FOR THE SELLER TO SE ARCH THE PROSPECTIVE BUYER OF THEIR LAND WHERE AS IT IS A JOB OF A BROKER TO S ELL THE SAME AND SEARCH THE PROSPECTIVE BUYER BY PUTTING THEIR EFFORTS IN T HE OPEN MARKET OR BY GIVING ADVERTISEMENT IN THE NEWS PAPER. SOMETIMES B ROKER SALE THE LAND OVER AND ABOVE THE DEMANDED SALE PRICE OF THE ACTUA L LAND OWNER, WHO GIVES THE POWER OF ATTORNEY AND EXCESS AMOUNT EARNE D ON SUCH SALE IS THE EARNING OF THE BROKER. TO DEAL WITH THE DIFFERE NT DIFFERENT CUSTOMER SOME TIME PAYMENT DIRECTLY RECEIVED BY THE BROKER A ND THEN SUBSEQUENTLY TRANSFER THE AMOUNT TO THE ORIGINAL LA ND OWNER. IN THIS WAY POWER OF ATTORNEY IS OBTAINED WITHOUT CONSIDERA TION TO DEAL WITH ON OR ON BEHALF OF THE LAND OWNER, WHERE AS LEARNED AS SESSING OFFICER HAS WRONGLY INTERPRETED THE POWER OF ATTORNEY AS INDIRE CT PURCHASE OF LAND WITH CONSIDERATION , IF IT IS SO WHY MOST OF THE PA YMENTS AS SHOWN IN THE BANK BOOK OF THE ASSESSEE IS ROUTED TO THE ORIGINAL LAND OWNERS DIRECTLY FROM THE BUYERS OR THROUGH THE ASSESSEE ACCOUNT . L EARNED ASSESSING OFFICER WHILE FRAMING HIS ORDER WRONGLY INTERPRETED THE POWER OF ATTORNEY AS PURCHASE OF LAND BY ASSESSEE WITH CONSIDERATION, WHERE AS THERE IS NO EVIDENCE AVAILABLE WITH THE ASSESSING OFFICER TH AT POA ACQUIRED BY THE ASSESSEE IS A PURCHASE OF LAND BY ASSESSEE WITH CONSIDERATION, HENCE MERE ASSUMPTION COULD NOT NEED TO THE BASIS O F ESTIMATION OF THE INCOME BY MULTIPLYING THE BANKING AND CONSIDERING N ET PROFIT ON ASSUMPTION BASIS IS NOT JUSTIFIABLE AND ERRONEOUS I N NATURE. HARISH PATEL IT(SS)NOS.32 TO 38/IND/2014 23 09. ASSESSING OFFICER HAS WRONGLY INVOKED THE PROVI SIONS OF SECTION 145(3) OF THE INCOME TAX ACT BY MAKING HYPOTHETICAL AND ARBITRARY ESTIMATION OF THE RECEIPTS AND PROFITS ON A VERY HI GHER SIDE WITHOUT ANY REASONABLE BASIS AND EVIDENCE BROUGHT IN TO RECORD. IT IS CLEAR THAT SECTION 145 OF THE IT ACT 1961 , ONLY PROVIDES THE BASIS ON WHICH COMPUTATION OF INCOME IS TO BE MADE FOR THE PURPOSE OF DETERMINING THE AMOUNT OF TAX. THE PROVISIONS BY ITSELF DO NOT DEAL WITH UNSUBSTANTIATED ADDITIONS TO BE MADE ON PRESUMPTIONS. BECAUSE, WITH OUT PREJUDICE IN ANY VIEW OF THE MATTER, THE ESTIMATION OF THE INCOM E OF ASSUMPTIVE TURNOVER IS VERY HIGH. 10. SECTION 143(3)(II) EMPOWERS THE ASSESSING OFFIC ER TO GO THROUGH THE EVIDENCES FOR FRAMING SCRUTINY ASSESSMENT ORDER V IZ (A) EVIDENCE PRODUCED BY THE ASSESSEE (B) EVIDENCE REQUIRED FROM THE ASSESSING OFFICER TO BE PRODUCED AND (C) AFTER TAKING IN TO A CCOUNT ALL THE RELEVANT MATERIAL GATHERED BY THE ASSESSING OFFICER. IT IS C LEAR FROM LAIN READING OF SECTION 143(3) THAT ASSESSMENT OF INCOME SHOULD BE BASED ON RELEVANT AND GATHERED MATERIAL AND NOT BEYOND THAT. BECAUSE THE LEARNED AO HAS ERRED IN APPLYING PRESUMPTIVE RATE OF INCOME OF THE GROSS RECEIPT AND CONSIDERING GROSS RECEIPT AS 5 , 3 , 2 TIMES OF THE BANKING IS ON UNJUSTIFIED ASSUMPTION AND ADDED THE DIFFERENCE IN THE RESPECTIVE PREVIOUS YEAR AS SHORT SURPLUS SHOWN BY THE ASSESSE E. 11. LEARNED ASSESSING OFFICER HAS WRONGLY INVOKED T HE PROVISIONS OF SECTION 145(3) OF THE INCOME TAX ACT BY MAKING HYPO THETICAL AND ARBITRARY ESTIMATION OF THE RECEIPTS AND PROFITS ON A VERY HIGHER SIDE WITHOUT AN REASONABLE BASIS AND EVIDENCE BROUGHT IN TO RECORD. IT IS CLEAR THAT SECTION 145 OF THE IT ACT 1961 , ONLY COMPUTAT ION OF INCOME IS TO BE MADE FOR THE PURPOSE OF DETERMINING THE AMOUNT OF T AX. THE PROVISIONS BY ITSELF DO NOT DEAL WITH UNSUBSTANTIATED ADDITION S TO BE MADE ON PRESUMPTIONS .BECAUSE THE LEARNED AO HAS WRONGLY IN TERPRETED THAT TRANSACTIONS THROUGH POWER OF ATTORNEY AS INDIRECT PURCHASE ON LAND BY THE ASSESSEE, WHERE AS NECESSARY SUPPORTING AND EVI DENCES ARE AVAILABLE WITH THE LEARNED ASSESSING OFFICER THAT IT IS ONLY SALE OF LAND ON COMMISSION BASIS , WHICH IS BASED ON WITHOUT SIGNIF ICANT EVIDENCE AND UNJUSTIFIED ASSUMPTION AND AGAINST THE LAW OF JUSTI CE. 12. BECAUSE THE HON'BLE CIT - APPEAL/LEARNED AO HAS ERRED IN INTERPRETING THE LOOSE PAPERS AND OTHER MISCELLANEO US PAPERS AS PART OF THE BUSINESS TRANSACTIONS WITHOUT CONSIDERING THE E XPLANATION AND SUBMISSIONS AND CONSIDERING THE NATURE OF BUSINESS OF THE ASSESSEE AS REAL ESTATE BROKER / CONSTRUCTION WORK / PETTY CONT RACT WORK / DEVELOPMENT WORK OF AGRICULTURE LAND AND CONVERT TH EM IN TO FARM HOUSE LAND IS ARBITRARY, ILLEGAL, CONTRARY TO THE L AW OF JUSTICE. HARISH PATEL IT(SS)NOS.32 TO 38/IND/2014 24 13. ASSESSING OFFICER SHOULD HAVE DILIGENTLY MADE A MEANINGFUL EXERCISE TO SURFACE THE INSTANCES OF SUPPRESSION IN THE SALES/RECEIPTS OR INFLATION IN PURCHASE/EXPENSES AS ALSO THE UNDISCLO SED INVESTMENT MADE BY THE ASSESSEE IF ANY AND SHOULD HAVE ALSO APPRAIS ED THE ASSESSEE WITH THE JUSTIFICATION FOR REJECTION OF THE BOOKS FOR IN VOKING PROVISIONS OF SECTION 145(3). IT IS A WELL SETTLED LAW THAT UNDI SCLOSED INCOME ASSESSED IF ANY MUST INVARIABLY BE MATCHED WITH THE UNRECORD ED ASSETS FOUND/SEIZED DURING SEARCH, HENCE ESTIMATION OF REC EIPTS BY FIVE TIMES OF BANKING AND CONSIDERING 8% AS NET PROFIT IS BAD IN THE EYES OF LAW OF JUSTICE. .BECAUSE THE LEARNED AO HAS WRONGLY ASSUME D THE GROSS RECEIPT OF THE BUSINESS AS 5 , 3 ,2 TIMES OF THE BANKING OF THE ASSESSEE BY MAKING WRONG ESTIMATION THAT BANKING OF THE ASSESSE E IS ONLY JUST LIKE TIP OF THE ICE BERG IN THE OCEAN OF THE BUSINESS TR ANSACTIONS OF THE ASSESSEE AND BASED ON SUCH WRONG INTERPRETATION ASS ESSED THE INCOME OF THE ASSESSEE IN ALL THE BLOCK OF ASSESSMENT YEAR S ON ASSUMPTION BASIS OF THE HYPOTHETICAL GROSS RECEIPT. 14. ASSESSING OFFICER HAS NO POWER / JURISDICTION T O SUMMARILY REJECT THE BOOKS AND TO CHOOSE A SHORT CUT METHOD OR ESTIM ATING THE RECEIPTS AND PROFIT MARGIN. BECAUSE WITHOUT PREJUDICE IN ANY VIEW OF THE MATTER THE DISALLOWANCES ARE HIGHLY EXCESSIVE. 15. IN MOST OF THE IMPUGNED ADDITIONS MADE BY THE A SSESSING OFFICER, IN THE EVENT OF DOUBT OR DISPUTE, BEFORE HOLDING ANY A DVERSITY AGAINST THE ASSESSEE, CONCERNED PARTIES HAVE NOT BEEN SUMMONED AND EXAMINED BY THE ASSESSING OFFICER, TO FIND OUT TRUTH IN THE STA TED FACTS, WHICH IS AN ESSENTIAL FEATURE WHILE MAKING AN ADDITION OR ASSES SMENT OF INCOME. ADDITION MADE BY THE ASSESSING OFFICER IS WITHOUT C ONSIDERING THE SUBMISSIONS OF THE BANK STATEMENT, CASH BOOK, LAND DETAILS AND OTHER RELATED SUPPORTING PROVIDED BY THE ASSESSEE. 15. LD. COUNSEL FOR THE ASSESSEE PLACED RELIANCE ON THE DECISION OF CO-ORDINATE BENCH IN THE CASE OF ACIT V/S VINOD SHA RMA IT(SS) NOS 227 TO 231/IND/2012 ORDER DATED 10.1.2017 WHER EIN SIMILAR FACTS WERE ADJUDICATED IN THE CASE OF SHRI VINOD SH ARMA WHO WAS ALSO HAVING REGULAR BUSINESS TRANSACTION WITH THE A SSESSEE. HARISH PATEL IT(SS)NOS.32 TO 38/IND/2014 25 16. PER CONTRA DEPARTMENTAL REPRESENTATIVE VEHEMENT LY ARGUED AND SUPPORTING THE ORDERS OF LOWER AUTHORITIES AND FURTHER SUBMITTED THAT THE ASSESSEE FAILED TO GIVE THE EXPL ANATION FOR VARIOUS ENTRIES APPEARING IN THE BANK AS WELL AS IN THE LOOSE PAPERS SHOWING CASH TRANSACTIONS AND THERE WAS NO OPTION L EFT WITH THE LD. A.O TO ESTIMATE THE PROFITS TAKING NOTE OF THE INVO LVEMENT OF CASH IN THE TRANSACTIONS RELATING TO IMMOVEABLE PROPERTIES. 17. WE HAVE HEARD RIVAL CONTENTIONS, PERUSED THE RE CORDS PLACED BEFORE US AND ALSO CAREFULLY GONE THROUGH THE WRITT EN SUBMISSION FILED BY THE LD. COUNSEL FOR THE ASSESSEE AND ALSO EXAMINED THE FACTS IN LIGHT OF VARIOUS JUDGMENTS AND DECISIONS R EFERRED AND RELIED BY THE LD. COUNSEL FOR THE ASSESSEE. 18. WE FIND THAT A SEARCH AND SEIZURE OPERATION WER E CARRIED OUT AT THE PREMISES OF SHRI VINOD SHARMA ON 30.05.2008 AT BHOPAL AND VARIOUS INCRIMINATING MATERIALS RELATING TO THE ASS ESSEE WERE ALSO FOUND WHICH RESULTED IN ISSUANCE OF NOTICE U/S 153 C OF THE ACT. ASSESSEE ALSO DECLARED AN AMOUNT OF RS.4 LAKHS FOR ASSESSMENT YEAR 2008-09 FOR NOT RECORDING THE TRANSACTIONS IN THE BOOKS OF ACCOUNTS. VARIOUS OTHER LOOSE PAPERS WERE SEIZED WH ICH CONTAINED HARISH PATEL IT(SS)NOS.32 TO 38/IND/2014 26 TRANSACTIONS THROUGH BANK AS WELL AS CASH FOR WHICH SATISFACTORY REPLY WAS NOT GIVEN BY THE ASSESSEE DURING THE COUR SE OF ASSESSMENT PROCEEDINGS. AFTER GOING THROUGH THE RE LEVANT RECORDS THERE SEEMS NO DISPUTE TO THE FACT THAT DURING THE COURSE OF SEARCH VARIOUS INCRIMINATING MATERIAL/DOCUMENTS WERE FOUND AND THE ASSESSEE WAS UNABLE TO EXPLAIN/CORRELATE THEM WITH THE ENTRIES IN THE REGULAR BOOKS OF ACCOUNTS AND THEREFORE IN THIS GIVEN FACTS AND CIRCUMSTANCES, WE FIND NO INFIRMITY IN THE ACTION O F THE LD.A.O REJECTING THE BOOKS OF ACCOUNTS BY INVOKING THE PRO VISIONS OF SECTION 145(3) OF THE ACT. WE THEREFORE DISMISS THIS COMMO N ISSUE OF THE ASSESSEE CHALLENGING THE ACTION OF THE LD.A.O INVOK ING THE PROVISION OF SECTION 145(3) OF THE ACT AND REJECTING THE BOOK RESULTS. 19. NOW COMING TO THE ESTIMATION OF INCOME BY THE L D.A.O AS WELL AS RELIEF GIVEN BY LD.CIT(A), WE FIND THAT THE LD.A .O DID NOT RECEIVED ANY SATISFACTORY REPLY FROM THE ASSESSEE FOR THE AL LEGED 42 ENTRIES APPEARING IN THE LOOSE PAPERS LPS-3/1 PAGE NO.22 TO 74 EVEN AFTER GIVING VARIOUS OPPORTUNITIES WHICH PAVED THE WAY FO R THE LD. A.O TO TAKE A VIEW THAT THE ASSESSEE IS TRANSACTING MOSTLY IN CASH AND VERY FEW TRANSACTIONS WERE ROUTED THROUGH BANKING CHANNEL AND HARISH PATEL IT(SS)NOS.32 TO 38/IND/2014 27 THE DEPOSITS APPEARING IN THE BANK ACCOUNT WERE JUS T LIKE THE TIP ICEBERG IN THE OCEAN OF BUSINESS TRANSACTION OF THE APPELLANT. CONSIDERING THIS THE LD.A.O ESTIMATED ACTUAL PROFIT EARNED BY THE APPELLANT FROM THE BUSINESS BY ESTIMATING GROSS REC EIPT OF EACH YEAR UNDER CONSIDERATION AT 5 TIMES OF DEPOSITS IN ALL T HE BANK ACCOUNT OF APPELLANT AND ESTIMATED NET PROFIT @8% OF SUCH E STIMATED RECEIPT AND CALCULATED ADDITION IN THE FOLLOWING MANNER; ASSESSMENT YEAR A.Y 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 TOTAL CR IN ALL BANKS ACCOUNTS OF ASSESSEE 400940 266560 394570 992990 11435028 7942244 267947 0 ESTIMATED TURNOVER 2004700 1332800 1972850 4964950 57175140 37461220 2 3656070 TOTAL DEPOSITS MULTIPLIED BY 5 TIMES 5 TIMES 5 TIMES 5 TIMES 5 TIMES 5 TIMES 5 T IMES % OPT FOR INCOME ESTIMATION 8% 8% 8% 8% 8% 8% 8% ESTIMATE INCOME AS PER 8 ESTIMATION 160376 106624 157828 397196 4574011 2996898 1892480 ACTUAL INCOME AS PER 76240 82413 96213 142360 399850 460756 497516 HARISH PATEL IT(SS)NOS.32 TO 38/IND/2014 28 ASSESSEE RETURN DIFFERENCE INCOME 84136 24211 61615 254836 4174161 2536142 1394970 20. AGGRIEVED WITH THE FINDING OF LD.A.O, ASSESSEE CAME IN APPEAL BEFORE THE LD.CIT(A) AND PARTLY SUCCEEDED AS LD.CIT (A) GAVE RELIEF TO THE ASSESSEE OBSERVING AS FOLLOWS; 3.3 I HAVE CAREFULLY CONSIDERED THE SUBMISSION OF THE APPELLANT AND FACTS OF THE CASE. ADMITTED FACTS ARE THAT THE APPELLANT ADMITTED IN HIS STATEMENT RECORDED AFTER SEARCH ON 17.06.2008 THAT ALL HIS TRANSACTIONS WERE NOT RECORDED IN THE BOOKS OF ACCOUNT AND ALSO ADMITTED AN AMOUNT OF RS.4,OO,OOO/- FOR A.Y.2008-09 AS HIS ADDITIONAL INCOME IN ADDITION TO HIS REGULAR INCOME. DURING THE COURSE OF SEARCH, MANY DOCUMENTS CONTAINING THE TRANSACTIONS RELATED TO PURCHASE AND SALE OF LAND AND ALSO TO DEVELOPMENT OF LAND ETC. WERE FOUND. AS PER THE PROVISIONS OF SECTION 292C, THE CONTENTS OF SUCH DOCUMENTS FOUND DURING T HE COURSE OF SEARCH MAY BE PRESUMED TO BE TRUE. THE APPELLANT FAILED TO REBUT THE PRESUMPTION LAID DOWN U/S 292C WITH ANY COGENT EVID ENCE. THE APPELLANT SIMPLY STATED THAT MOST OF THE DOCUMENTS WERE LEFT WITH HIM BY THE OTHER BROKERS OR LAND OWNERS AND TRANSACTIONS H AD NOT UNDERTAKEN THROUGH OR BY HIM. IT IS A KNOWN FACT THAT IN THE T RANSACTIONS RELATING TO REAL ESTATES, THE SALE DEEDS ARE REGISTERED AT A LO WER PRICE THAN THE ACTUAL PRICE TRANSACTED. THEREFORE, CONSIDERING THE TOTAL ITY OF THE FACTS AND CIRCUMSTANCES OF THE CASE, THE AO WAS JUSTIFIED IN HOLDING THAT BOOKS OF ACCOUNT MAINTAINED BY THE APPELLANT WERE NOT CORREC T AND COMPLETE AND HAD RIGHTLY INVOKED PROVISIONS OF SECTION 145(3) OF THE IT ACT. HOWEVER, IT HARISH PATEL IT(SS)NOS.32 TO 38/IND/2014 29 IS NOTICED THAT THE AO HAD MADE ESTIMATION OF GROSS RECEIPTS AT FIVE TIMES OF THE TOTAL DEPOSITS IN HIS BANK ACCOUNTS, WHICH I S ON A HIGHER SIDE. IT IS NOTICED THAT NORMALLY IN REAL ESTATE BUSINESS, THE ACTUAL AMOUNT OF CONSIDERATION IS NORMALLY AROUND DOUBLE OF THE CONS IDERATION DECLARED FOR THE PURPOSES OF REGISTRATION OF DEEDS. THEREFO RE, IT WOULD BE IN THE INTEREST OF JUSTICE IF THE GROSS RECEIPTS OF THE AP PELLANT ARE ESTIMATED AT TWO TIMES OF THE GROSS DEPOSITS APPEARING IN THE BA NK ACCOUNTS OF THE APPELLANT FOR A.YS 2003-04 TO 2008-09. IN CASE OF A.Y. 2009-10, IT IS NOTICED THAT THE APPELLANT HAD SHOWN VERY LESS DEPO SITS IN THE BANK ACCOUNTS AS COMPARED TO THE ACTUAL GROSS RECEIPTS E ARNED BY HIM AND, THEREFORE, IT WOULD BE REASONABLE IF THE GROSS RECE IPTS ARE ESTIMATED AT THREE TIMES OF THE TOTAL GROSS RECEIPTS DECLARED BY THE APPELLANT DURING THE YEAR RELEVANT TO A.Y. 2009-10, AS THE TOTAL TUR NOVER ON THE BASIS OF TWO TIMES OF DEPOSITS IN BANK ACCOUNTS IN EARLIER T WO YEARS WORKS OUT AT ABOUT 3.5 TIMES OF THE TURNOVER DECLARED BY THE APP ELLANT. IT WOULD BE RELEVANT TO EXAMINE GROSS RECEIPTS AND NET PROFITS SHOWN BY THE APPELLANT IN THESE ASSESSMENT YEARS WHICH ARE AS UNDER:- PARTICULARS A.Y. 2003- 04 A.Y. 2004- 05 A.Y. 2005- 06 A.Y. 2006-07 A.Y. 2007-08 A.Y. 2008-09 A.Y. 2009-10 GROSS RECEIPTS FOR THE YEAR AS PER P&L A/C 368960 394570 426560 1117600 6268036 3981134 2679470 NET PROFIT AS PER P&L A/C 76,240 82,413 96,213 142360 399850 460756 497516 PERCENTAGE OF NET PROFIT WITH GROSS RECEIPTS (%) 20.66 20.89 22.55 12.74 6.38 11.57 18.57 CONSIDERING THE FACTS OF THE CASE, IT WOULD BE REAS ONABLE TO ADOPT THE SAME PERCENTAGE OF NET PROFIT AS HAD BEEN DECLARED BY THE APPELLANT HIMSELF. THEREFORE, POSITION OF NET PROFIT OF EACH ASSESSMENT YEAR ON THE HARISH PATEL IT(SS)NOS.32 TO 38/IND/2014 30 ESTIMATED TURNOVER WOULD WORK OUT AS UNDER: PARTICULARS A.Y. 2003-04 A.Y. 2004-05 A.Y. 2005-06 A.Y. 2006-07 A.Y. 2007-08 A.Y. 2008-09 TOTAL CREDITS IN THE BANK ACCOUNTS OF THE APPELLANT 400940 266560 394570 992990 11435028 7942244 ESTIMATED GROSS TURNOVER 801880 533120 789140 1985980 22870056 14984488 NET PROFIT AFTER APPLYING THE RATE/ PERCENTAGE OF NET PROFIT AS SHOWN BY THE APPELLANT 160376 111368 177951 253014 1459110 1733705 NET PROFIT AS SHOWN IN PROFIT &LOSS ACCOUNT 76240 82413 96213 142360 399850 460756 ADDITION 84136 28955 81738 110654 1059260 1272949 IN REGARD TO A. Y. 2009-10, THE ESTIMATED GROSS REC EIPTS AT THREE TIMES OF THE GROSS RECEIPTS SHOWN BY THE APPELLANT WOULD WOR K OUT AT RS.80,38,410/- (3 X RS.26,79,470) AND BY APPLYING T HE NET PROFIT RATE OF 18.57% AS DECLARED BY THE APPELLANT, THE NET PROFIT WOULD WORK OUT AT RS.14,92,733/-. THE APPELLANT HAD SHOWN NET PROFIT OF RS4,97,516/- AND, THUS, AN ADDITION OFRS.9,95,216/- (RS.14,92,73 3 RS4,97,516) WAS REQUIRED TO BE MADE IN A.Y.2009-10. IN VIEW OF THE ABOVE, THE AO IS DIRECTED TO MAKE AD DITION IN THE NET PROFITS SHOWN IN DIFFERENT ASSESSMENT YEARS AS UNDE R: PARTICULARS A.Y. A.Y. A.Y. A.Y. A.Y. A.Y. A. Y. 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 ADDITIONS (RS.) 84136 28955 81738 110654 10592 60 1272949 995216 IN VIEW OF THE ABOVE, THE ISSUE REGARDING ADDITION IN NET PROFIT IS DISPOSED OF ACCORDINGLY. 21. FROM PERUSAL OF THE ABOVE FINDING OF BOTH THE L OWER AUTHORITIES AS WELL AS THE DETAILED SUBMISSIONS GIVEN BY THE AS SESSEE, WE FIND HARISH PATEL IT(SS)NOS.32 TO 38/IND/2014 31 THAT THE ASSESSEE HAS NOWHERE GIVEN SPECIFIC REPLY FOR EACH OF THE LOOSE PAPER AS WELL AS THE ENTRIES MENTIONED THEREI N WHICH HAVE BEEN REPRODUCED BY THE LD.A.O IN THE IMPUGNED ASSES SMENT ORDER REFERRING TO 42 ENTRIES. UNDOUBTEDLY THE ASSESSEE HAS NOT DISCLOSED THE TOTAL BUSINESS RECEIPTS IN THE REGULAR BOOKS OF ACCOUNTS AND WHEN THE ASSESSEE HIMSELF WAS UNABLE TO EXPLAIN THE ENTRIES THERE REMAINS NO OPTION BEFORE THE LOWER AUTHORITIES EXCE PT TO ESTIMATE THE INCOME. LD. COUNSEL FOR THE ASSESSEE HAS HEAVI LY RELIED ON THE DECISION OF CO-ORDINATE BENCH IN THE CASE OF ACIT V /S VINOD SHARMA ITA NO.227 TO 231/IND/2012 ORDER DATED 10.1 .2017 WHO WAS THE MAIN PERSON SUBJECTED TO SEARCH ON 30.5.200 8 AND FROM HIS BUSINESS PREMISES VARIOUS DOCUMENTS BELONGING TO TH E ASSESSEE WERE FOUND AND SEIZED. IN THE CASE OF SHRI VINOD S HARMA SAME ISSUE CAME UP FOR ADJUDICATION REGARDING ESTIMATION OF PROFITS. HOWEVER WE FIND THAT THE FACTS ARE NOT SIMILAR BECA USE IN THE CASE OF SHRI VINOD SHARMA LD.A.O HAS NOT DISPUTED THE MAINT ENANCE OF REGULAR BOOKS OF ACCOUNTS AND HAS ALSO NOT INVOKED SECTION 145(3) OF THE ACT MANDATORY FOR REJECTING THE BOOKS OF ACC OUNTS, WHEREAS IN THE CASE OF ASSESSEE, BOOK RESULTS HAVE BEEN REJECT ED AND PROVISION OF SECTION 145(3) OF THE ACT HAVE BEEN INVOKED, THE REFORE THE HARISH PATEL IT(SS)NOS.32 TO 38/IND/2014 32 DECISION OF THE CO-ORDINATE BENCH IN THE CASE OF SH RI VINOD SHARMA (SUPRA) WILL NOT BE APPLICABLE ON THE FACTS OF THE ASSESS EE. 22. WE HOWEVER FIND THAT LD.CIT(A) HAS ESTIMATED TH E TURNOVER TWICE THE RECEIPTS BUT HAS APPLIED THE NET PROFIT R ATE WHICH HAS ACTUALLY BEEN DECLARED BY THE ASSESSEE IN THE INCOM E TAX RETURN. HOWEVER IN OUR CONSIDERED VIEW WHEN THE BOOK RESULT S HAVE BEEN REJECTED AND PROFITS HAVE BEEN ESTIMATED ON THE EST IMATED GROSS RECEIPTS THEN IT WILL NOT BE JUSTIFIED TO APPLY THE SAME NET PROFIT RATE AS HAS BEEN DECLARED BY THE ASSESSEE BECAUSE THE TU RNOVER TAKEN BY BOTH THE LOWER AUTHORITIES IS DIFFERENT FROM THE ON E SHOWN BY THE ASSESSEE. WE THEREFORE IN THE GIVEN FACTS AND CIRC UMSTANCES OF THE CASE ARE OF THE CONSIDERED VIEW THAT AS THE ASSESSE E HAS FAILED TO DISCHARGE ITS ONUS TO EXPLAIN THE ENTRIES APPEARING IN THE LOOSE PAPERS, ESTIMATION OF RECEIPTS AND NET PROFIT HAS R IGHTLY BEEN CARRIED OUT BUT WE IN ORDER TO BE FAIR TO BOTH THE PARTIES, WE DECIDE TO ESTIMATE THE RECEIPT AT TWO TIMES OF THE ALLEGED BA NK TRANSACTIONS AND COMPUTE THE NET PROFIT @8% AND IN CASE THE NET PROFIT DECLARED BY THE ASSESSEE IS MORE THAN THE ESTIMATE NET PROFI T @8%, THEN NO ADDITION SHALL BE MADE FOR THAT PARTICULAR ASSESSME NT YEAR. ON HARISH PATEL IT(SS)NOS.32 TO 38/IND/2014 33 APPLICATION OF OUR ABOVE VIEW OF COMPUTING GROSS RE CEIPTS AT TWO TIMES OF THE UNEXPLAINED BANK TRANSACTIONS AND APPL ICATION OF NET PROFIT RATE @8% ONLY THE ADDITION OF RS.16,518/-, 14,29,754/- AND RS.7,38,003/- NEEDS TO BE SUSTAINED FOR ASSESSMENT YEAR 2006-07, 2007-08 AND 2008-09 RESPECTIVELY AND THE SAME IS CO MPUTED IN THE FOLLOWING MANNER; ASSESSMENT YEAR A.Y 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 TOTAL CR IN ALL BANKS ACCOUNTS OF ASSESSEE 400940 266560 394570 992990 11435028 7942244 267947 0 ESTIMATED TURNOVER 801880 533120 789140 1985980 22870056 14984488 5358 940 TOTAL DEPOSITS MULTIPLIED BY 2 TIMES 2 TIMES 2 TIMES 2 TIMES 2 TIMES 2 TIMES 2 T IMES % OPT FOR INCOME 8% 8% 8% 8% 8% 8% 8% ESTIMATED INCOME 64150 42650 63131 158878 1829604 1198759 468715 ACTUAL INCOME DECLARED BY THE ASSESSEE 76240 82413 96213 142360 399850 460756 497516 ADDITION TO BE CONFIRMED NIL NIL NIL 16518 1429754 738003 NIL HARISH PATEL IT(SS)NOS.32 TO 38/IND/2014 34 23. IN VIEW OF OUR DISCUSSION ABOVE AND TABLE MENT IONED, WE DELETE THE ADDITION FOR ESTIMATED PROFITS FOR ASSES SMENT YEAR 2003- 04, 2004-05, 2005-06 AND 2009-10 AND SUSTAIN THE AD DITION AT RS.16,158/-, RS.14,29,754/- AND RS.7,38,003/- FOR A SSESSMENT YEAR 2006-07, 2007-08 AND 2008-09 RESPECTIVELY. 24. IN THE RESULT THIS COMMON ISSUE RAISED BY THE A SSESSEE IN GROUND NO.2 FOR ASSESSMENT YEAR 2003-04 TO 2006-07 AND IN GROUND NO.1 IN ASSESSMENT YEAR 2007-08 TO 2009-10 A RE PARTLY ALLOWED. 25. NOW WE TAKE THE SECOND COMMON ISSUE RAISED FOR ASSESSMENT YEAR 2003-04 TO 2006-07 FOR TREATING THE AGRICULTUR E INCOME OF RS.71,620/-, RS.56,854/-, RS.2400 AND RS.3410/- FOR ASSESSMENT YEAR 2003-04 TO 2006-07 AS INCOME FROM UNDISCLOSED SOURCES. 26. LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE ASSESSEE RECEIVED THE SHARE OF AGRICULTURE INCOME FROM PAREN TAL AGRICULTURE LAND MEASURING 10 ACRES SITUATED AT MASAN GAON, HAR DA AS PART OF THE INCOME OF HINDU UNDIVIDED FAMILY. HE FURTHER ST ATED THAT SUCH SHARE OF AGRICULTURE INCOME WAS NOT RECEIVED DURING ASSESSMENT HARISH PATEL IT(SS)NOS.32 TO 38/IND/2014 35 YEAR 2007-08, 2009-10 DUE TO FLOODS AND OTHER REAS ONS. HE FURTHER SUBMITTED THAT ASSESSEE BELONGS TO MASAN GA ON - HARDA AND HAVING PARENTAL LAND AT HARDA WHICH IS PART OF THE HINDU UNDIVIDED FAMILY AND AS PER HINDU LAW EVERY MALE ME MBERS OF THE FAMILY OWNS THE EQUAL RIGHT IN THE PARENTAL PROPERT Y EARNED BY THE FORE FATHERS. AT HARDA (MASAN GAON) THERE IS A PARE NTAL LAND APPX 10 ACRE USED FOR THE AGRICULTURE PURPOSE. COPY OF THE BAHI / RIN PUSTIKA / OTHER RELATED PAPERS ANNEXED IN SUPPORT O F THE SAME. LAND IS USED FOR AGRICULTURE PURPOSE AND PROFIT FRO M THE SAME AFTER DEDUCTING ALL EXPENSES ARE DISTRIBUTED TO THE MEMBE RS AS DISTRIBUTION OF AGRICULTURE INCOME, AMONG THE FAMIL Y HAVING RIGHT IN THE PROPERTY BY WAY OF HINDU LAW I.E SHRI. HARISH P ATEL AND HIS FATHER AND OTHER BROTHERS. ASSESSEE SHOWS THIS INCO ME AS PART OF THE THEIR TOTAL INCOME UNDER THE HEAD SHARE OF AGRI CULTURE INCOME FROM PARENTAL LAND IN THE A.Y 2003-2004 TO A.Y 2006 -2007. LEARNED ASSESSING OFFICER HAS ADDED THE SAME ON THE GROUND THAT DURING THE SEARCH PERIOD NO KHASRA, NO TITLE DEED O F THE HOLDING OF LAND, NO DETAILS ABOUT THE EXPENSES ON AGRICULTURE WORK OBTAINED. THIS HAS ALREADY BEEN EXPLAINED TO THE LEARNED ASSE SSING OFFICER IN THE WRITTEN SUBMISSION THAT ASSESSEE HOLDS THE SHAR E IN THE HARISH PATEL IT(SS)NOS.32 TO 38/IND/2014 36 PARENTAL LAND AT MASAN GAON AND USED TO GO TO THEIR PARENTAL/NATIVE PLACE TO LOOK AFTER THE AGRICULTURE WORK SPECIALLY DURING THE PERIOD OF BUBAI OF SOYABEAN, GEHU AND OT HER CROP AND AT THE TIME OF THEIR CULTIVATION/ OTHER AGRICULTURE WORK FROM TIME TO TIME FROM BHOPAL TO HARDA. HENCE ALL THE RELATED RE CORDS FOR THE AGRICULTURE LAND AND EXPENSES / RECEIPT FROM AGRICU LTURE WORK ARE KEPT AT HARDA AND NOT AT THE BUSINESS PREMISES OF A SSESSEE. ASSESSEE RECEIVED THE SHARE OF NET INCOME FROM AGRI CULTURE WORK FROM HARDA FROM HIS FATHER AFTER DEDUCTING ALL EXPE NSES FOR THE AGRICULTURE WORK. HENCE MERE NON AVAILABILITY OF T HE RELATED PAPERS AND RELATED DETAILS AT THE ASSESSEE PREMISES DOES N OT ALLOW THE LEARNED ASSESSING OFFICER / HON'BLE CIT - APPEAL TO ADD THE SAME AS INCOME FROM OTHER SOURCE . TREATMENT OF THE AGRI CULTURE INCOME AS INCOME FROM OTHER SOURCES ARE WRONG AND AGAINST THE LAW OF THE NATURAL JUSTICE AS INCOME IS TAXED BY ITS NATURE AN D NOT BY ITS PRESENTATION. 27. PER CONTRA LD. DEPARTMENTAL REPRESENTATIVE VEHE MENTLY ARGUED AND SUPPORTED THE ORDERS OF LOWER AUTHORITIE S. HARISH PATEL IT(SS)NOS.32 TO 38/IND/2014 37 28. WE HAVE HEARD RIVAL CONTENTIONS AND PERUSED THE RECORDS PLACED BEFORE US. 29. ASSESSEE HAS CHALLENGED THE ACTION OF BOTH THE LOWER AUTHORITIES TREATING THE AGRICULTURE INCOME FOR ASS ESSMENT YEAR 2003-04 TO 2006-07 AT RS.71,620/-, RS.56,854/-, RS. 2400 AND RS.3410/- RESPECTIVELY AS INCOME FROM OTHER SOURCES . WE FIND THAT THE ASSESSEE HAS FILED NECESSARY EVIDENCE TO SHOW T HAT THERE EXISTS AN ANCESTRAL PARENTAL LAND MEASURING APPROXIMATE 10 ACRES AT MASAN GAON, HARDA WHICH IS THE PART OF THE HINDU UN DIVIDED FAMILY. THIS LAND IS REGULARLY CULTIVATED. AGRICU LTURAL PRODUCE IS SOLD WHICH IS DULY EVIDENCED BY RIN PUSTIKA GIVING DETAILS OF VARIOUS ITEMS SOLD. WE ARE SATISFIED WITH THE SUBMISSIONS MADE BY THE LD. COUNSEL FOR THE ASSESSEE THAT THE ALLEGED AGRICULTU RAL INCOME IS SHARE OF THE ASSESSEE OUT OF THE NET PROFIT FROM SA LE OF AGRICULTURAL PRODUCE AFTER DEDUCTING ALL INCIDENTAL EXPENSES WHI CH IS BEING DISTRIBUTED TO THE MEMBERS OF THE HINDU UNDIVIDED F AMILY. WE ACCORDINGLY SET ASIDE THE FINDINGS OF BOTH THE LOWE R AUTHORITIES AND DIRECT THE LD.A.O TO TREAT THE INCOME AT RS.71,620/ -, RS.56,854/-, HARISH PATEL IT(SS)NOS.32 TO 38/IND/2014 38 RS.2400 AND RS.3410/- AS AGRICULTURAL INCOME FOR A SSESSMENT YEAR 2003-04 TO 2006-07 RESPECTIVELY. 30. THIS COMMON ISSUE RAISED BY THE ASSESSEE IN GRO UND NO.1 FOR ASSESSMENT YEAR 2003-04 TO 2006-07 IS ALLOWED. 31. NOW WE TAKE UP THE THIRD ISSUE PERTAINING TO AS SESSMENT YEAR 2008-09 RAISED BY THE ASSESSEE IN GROUND NO.2 RELAT ING TO ADDITION OF UNEXPLAINED INVESTMENT OF RS.5 LAKHS FOR PURCHAS E OF AGRICULTURE LAND AT GRAM KAL KHEDA MEASURING 0.809 ACRE. LD.CI T(A) HAS CONFIRMED THE ADDITION OF RS. 5 LAKHS OBSERVING AS FOLLOWS; 5.3 I HAVE CAREFULLY CONSIDERED THE SUBMISSION OF THE APPELLANT AND FACTS OF THE CASE. ON PERUSAL OF COPY OF CASH BOOK OF THE RELEVANT PERIOD FROM 01.03.2008 TO 31.03.2008 FURNISHED BY THE APPELLANT DURING APPELLATE PROCEEDINGS, IT IS NOTICED THAT APPELLANT HAD SHOWN PAYMENT OF RS.5,60,0001- ON 29.03.2008 FOR THE PURCHASE OF LAN D AT KALAKHEDA. AS PER THE SALE DEED REGISTERED, THE CONSIDERATION OF THE LAND WAS SHOWN AT RS.5,00,0001- AND THE APPELLANT HAD PAID STAMP DUTY OF RS.74,9501- ON THE MARKET VALUE ADOPTED FOR STAMP DUTY PURPOSES AT RS.7,97,300/-. IT IS PERTINENT TO NOTE THAT STAMP DUTY HAD BEEN SHOWN TO PAID ON 25.03.2008 AND THE SALE DEED WAS REGISTERED WITH THE REGISTRAR ON 28.03.2008. IN THIS SALE DEED, IT HAS CLEARLY BEEN MENTIONED THAT THE PAYMENT OF RS.5,00,OOO/-- IN CASH HAD ALREADY BEEN PAID TO THE SELLER. THUS, THE PAYMENT OF RS.5,00,000/- AS SALE CONSIDERATION AS W ELL AS STAMP DUTY OFRS.74,950/- WAS PAID BY THE APPELLANT IN CASH ON OR BEFORE 28.03.2008. HOWEVER, THE APPELLANT HAD NOT SHOWN AN Y WITHDRAWAL OF HARISH PATEL IT(SS)NOS.32 TO 38/IND/2014 39 CASH FOR STAMP DUTY PAYMENT OF RS.74,950/- ON 25.03 .2008 AND FOR PAYMENT OF SALE CONSIDERATION OF RS.5,00,000/- ON O R BEFORE 28.03.2008 IN HIS CASH BOOK. THE APPELLANT HAD SHOWN WITHDRAWA L OF RS.5,60,000/- ON ACCOUNT OF COST OF LAND AT KALAKHEDA ON 29.03.20 08 I.E. AFTER THE DATES ON WHICH THE PAYMENTS FOR STAMP DUTY OF RS.74 ,950/- AS WELL AS PAYMENT OF RS.5,00,000/- -IN CASH OF SALE CONSIDERA TION HAD ACTUALLY BEEN MADE ON OR BEFORE 48.03.2008. HENCE, THE INVES TMENT OF THE APPELLANT IN THE PURCHASE OF LAND AT KALAKHEDA OF R S.5,74,950/- (RS.5,00,000 + RS.74,950 OF STAMP DUTY) MADE ON OR BEFORE 28.03.2008 WAS NOT REFLECTED IN THE REGULAR BOOKS OF ACCOUNT. THUS, THE AO HAD RIGHTLY TREATED THE INVESTMENT IN THE LAND AT KALAK HEDA AS UNEXPLAINED. HOWEVER, THE AO HAD MADE ADDITION OF RS.5,00,000/- ONLY, WHEREAS THE ACTUAL ADDITION SHOULD HAVE BEEN RS.5,74,9501-. ACC ORDINGLY, THE AO IS DIRECTED TO MAKE AN ADDITION OF RS.5,74,950/- ON AC COUNT OF UNEXPLAINED INVESTMENT IN THE PURCHASE OF LAND AT KALAKHEDA IN A.Y.2008-09. 32. EXAMINING THE FACTS IN THE LIGHT OF THE SUBMISS IONS GIVEN BY THE ASSESSEE AS WELL AS THE FINDINGS OF LD.CIT(A), WE FIND THAT UNDISPUTEDLY THERE IS A TRANSACTION FOR PURCHASE OF AGRICULTURE LAND. CASH OF RS.5 LAKHS HAS BEEN PAID. CONTROVERSY HAS ARISED FOR THE ALLEGED DATE OF PAYMENT. AS PER THE PURCHASE DEED THE CASH PAYMENT OF RS.5 LAKHS HAS ALREADY BEEN GIVEN ON A ND BEFORE 28.3.2008 BECAUSE THE PURCHASE DEED IS PREPARED ON THE STAMP PAPER DATED 25.3.2008 AND IT HAS BEEN REGISTERED ON 28.3.2008 WHEREAS THE ASSESSEE HAS SHOWN THE WITHDRAWAL OF RS .5,60,000/- HARISH PATEL IT(SS)NOS.32 TO 38/IND/2014 40 ON 29.3.2008 IN ORDER TO MAKE THE PAYMENT FOR PURCH ASE OF THE LAND. REVENUE AUTHORITIES ARE NOT DISPUTING THIS F ACT THAT CASH AMOUNT WAS WITHDRAWN ON 29.3.2008, MEANING THEREBY THAT THERE WAS SUFFICIENT CASH BALANCE ON 29.3.2008 WHICH COUL D EXPLAIN THE CASH PAYMENT MADE BY THE ASSESSEE. MERELY FOR THE REASON THAT THE PURCHASE DEED WAS REGISTERED ON 28.3.2008 AND CASH BEING WITHDRAWN ON 29.3.2008 CANNOT PAVE THE WAY FOR THE IMPUGNED ADDITION BECAUSE THE ASSESSEE HAS SUFFICIENT FUNDS TO PURCHASE THE LAND AND THERE IS NO OBSERVATION BY THE LD.A.O ABOU T THE POSITION OF CASH IN HAND ON 28.3.2008. DENYING THE ASSESSEES CLAIM FOR THE MERE REASON THAT CASH WITHDRAWAL WAS ON 29.3.2008 W HEREAS IT WAS ALLEGEDLY PAID ON 28.3.2008 WILL NOT BE JUSTIFIED A ND FAIR IN THE INTEREST OF JUSTICE AS ONE CANNOT IGNORE THE POSSIB ILITY THAT ALL THE SELLERS OF THE LAND BEING FARMERS MAY HAVE RECEIVED THE CASH ON 29.3.2008, AS SUBMITTED BY THE LD. COUNSEL FOR THE ASSESSEE THAT AFTER THE REGISTRY FORMALITIES WERE COMPLETED CASH WAS HANDED OVER TO THE FARMERS ON 29.3.2008. WE THEREFORE IN THE G IVEN FACTS AND CIRCUMSTANCES OF THE CASE FIND NO JUSTIFICATION IN THE FINDING OF THE LOWER AUTHORITIES SUSTAINING THE ADDITION OF RS. 5 LAKHS FOR UNEXPLAINED CASH INVESTMENT AND ACCORDINGLY DIRECT THE LD.A.O TO HARISH PATEL IT(SS)NOS.32 TO 38/IND/2014 41 DELETE THE ADDITION OF RS. 5 LAKHS FOR THE UNEXPLA INED INVESTMENT IN PURCHASE OF AGRICULTURE LAND AT GRAM KAL KHEDA. 33. IN THE RESULT GROUND NO.2 OF THE ASSESSEES APP EAL FOR ASSESSMENT YEAR 2008-09 IS ALLOWED. 34. NOW WE ARE LEFT WITH GROUND NO.3 FOR ASSESSMENT YEAR 2008- 09 FOR THE ALLEGED UNEXPLAINED CASH INVESTMENT OF R S.34.50 LAKHS TOWARDS PURCHASE OF LAND AT MINDORI. 35. BRIEF FACTS RELATING TO THIS ISSUE IS THAT DURI NG THE COURSE OF ASSESSMENT PROCEEDINGS LD.A.O WHILE EXAMINING PAGES NO. 171 TO 174 OF ANNEXURE LPS-3/21 FOUND THE ORIGINAL COPY OF SALE LETTER OF LAND MEASURING 3 ACRES AT VILLAGE MINDORI JOINTLY H ELD BY FOUR PERSONS WHO AGREED TO SALE THIS LAND FOR CONSIDERAT ION OF RS.2,77,04,160/- TO TWO PERSONS NAMELY SHRI VINOD S HARMA AND THE ASSESSEE. ON THE DATE OF EXECUTION OF SALE LET TER RS. 44 LAKHS WAS PAID IN CASH AND RS.6 LAKHS THROUGH ACCOUNT PAY EE CHEQUE EQUALLY BY SHRI VINOD SHARMA AND SHRI HARISH PATEL. ON ANOTHER LOOSE PAPER SEIZED VIDE PAGE NO.39 OF LPS 3/20 IT W AS CLAIMED TO HAVE BEEN SHOWN THAT MR. ASHOK GOYAL HAS ACKNOWLEDG ED THE PAYMENT OF RS.25 LAKHS ON 8.2.2008 ON ACCOUNT OF M ANDORI LAND. HARISH PATEL IT(SS)NOS.32 TO 38/IND/2014 42 THIS TRANSACTION OF PURCHASE OF AGRICULTURE LAND WA S SUBSEQUENTLY CANCELLED AND THE ADVANCE AMOUNT GIVEN THROUGH ACCO UNT PAYEE CHEQUE WERE RETURNED BY ALL THE JOINT OWNERS. LD.A .O WAS MAINLY CONCERNED WITH THE ALLEGED CASH PAYMENT OF RS.44 LA KHS AND RS.25 LAKHS TOTALING TO RS.69 LAKHS GIVEN, EQUALLY BY SHR I VINOD SHARMA AND SHRI HARISH PATEL. AS THE ASSESSEE WAS UNABLE TO EXPLAIN THE SOURCE OF THE ALLEGED CASH PAYMENT AND MERELY CLAIM ED THAT NO SUCH TRANSACTION EVER HAPPENED BECAUSE THE ALLEGED AGREEMENT WAS NOT SIGNED BY ALL THE PARTIES. SUBMISSIONS OF THE ASSESSEE WERE NOT SUFFICIENT TO SATISFY THE LD.A.O AND HE MADE ADDITI ON OF 50% OF RS.69 LAKHS (RS.44 LAKHS + RS.25 LAKHS) AND MADE AD DITION OF RS.34,50,000/- IN THE HANDS OF THE ASSESSEE. THE A BOVE ADDITION OF RS.34,50,000/- WAS CONFIRMED BY LD.CIT(A). 36. NOW THE ASSESSEE IS IN APPEAL BEFORE THE TRIBUN AL. 37. LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE LEARNED ASSESSING OFFICER / LEARNED CIT APPEAL HAD TREATED 50 % OF THE COST OF LAND AT RS. 34.50 LACS APPX AREA OF LAND 3 ACRES AT VILLAGE MINDORI AS UNEXPLAINED INVESTMENT WITHOUT CONSIDERI NG THE FOLLOWINGS FACTS AND SUBMISSIONS OF THE ASSESSEE:- HARISH PATEL IT(SS)NOS.32 TO 38/IND/2014 43 (I). ASSESSMENT ORDER OF HON'BLE CIT-APPEAL AND LEA RNED DCIT IS TOTALLY BASED ON UNVERIFIABLE FACTS WITHOUT MAKI NG CONFIRMATION FROM VARIOUS PARTIES AND WHEN THE AGR EEMENT WAS NOT SIGNED BY OTHER PARTIES NOR IT WAS EXECUTED OR ENFORCED AND IT WAS NOT MATERIALIZES WHEREAS SUBSEQ UENTLY ADVANCE RETURNED THROUGH CHEQUE ON VARIOUS DATES. (II). NECESSARY SUMMONS NOT ISSUED TO THE CONCERN P ARTIES TO CHECK THE TRUTHNESS OF THE TRANSACTIONS . NECESSARY RECORDS AND CONFIRMATIONS ARE ALSO FOUND AVAILABLE IN THE R ECORD TO JUSTIFY THE CORRECTNESS OF THE NON EXECUTION OF THE TRANSACTIONS . (III). THE AGREEMENT WAS NOT SIGNED BY THE ASSESSEE AND SOME OTHER PARTIES AND WITHOUT WHICH NO LEGAL EXECUTION OF THE TRANSACTION CAN BE ASSUMED. (IV). AS PER ORDER OF THE HON'BLE CIT-APPEAL AND LE ARNED ASSESSING OFFICER AMOUNT PAID RS. 25.00 LACS TO SHR I. ASHOK GOYAL IS A PART OF THE AGREEMENT OF THE LAND WHERE AS HE IS NEITHER A PARTY OF THE SALE / PURCHASE AGREEMENT NO R HE IS HARISH PATEL IT(SS)NOS.32 TO 38/IND/2014 44 OWNER OF THE LAND PROPOSED TO BE PURCHASED BY THE A SSESSEE THROUGH AGREEMENT, HENCE THERE IS NO QUESTION OF PA YMENT OF RS. 25.00 LACS ON 08.02.2008 ON ACCOUNT OF MINDORI LAND TO SHRI. ASHOK GOYAL AS HE IS NO MORE CONCERN IN THIS PROPOSED CANCELLED TRANSACTIONS. (V). IT IS MERE ASSUMPTION OF THE LEARNED ASSESSING OFFICER THAT LOOSE PAPER CONTAINED PAYMENT OF RS. 25.00 LAC S TO SHRI. ASHOK GOYAL IS ON ACCOUNT OF THE LAND SITUATED AT M INDORI OF 3 ACRE. (VI). IT IS NOT JUSTIFIED THAT WITHOUT ANY SUBSTANT IAL DOCUMENTARY EVIDENCE NO ADDITION CAN BE CALLED UPON AT THE HAND OF THE ASSESSEE. (VII). ADDITION MADE BY ASSESSING OFFICER BASED ON EXTRANEOUS CONSIDERATIONS, UNSUBSTANTIATED ON THE STRENGTH OF CORROBORATIVE EVIDENCE IS AGAINST THE LAW OF NATURA L JUSTICE. (VIII). SOMETIME IN THE REAL ESTATE BUSINESS, JOINT VENTURE PROJECTS ARE PREPARED WITH TWO OR THREE BUILDERS AN D CONTRACTORS BUT NOT NECESSARY ALL OF THEM ARE EXECU TED DUE TO HARISH PATEL IT(SS)NOS.32 TO 38/IND/2014 45 VARIOUS VIEWS OR AVAILABILITY OF FUNDS OR ACCEPTANC E OF THE TERMS AND CONDITIONS, SAME HAS TAKEN PLACE IN THIS AGREEMENT DUE TO WHICH ASSESSEE HAS NOT SIGNED OR CONFIRM THE AGREEMENT. 38. LD. COUNSEL FOR THE ASSESSEE PLACED RELIANCE ON THE DECISION OF CO-ORDINATE BENCH IN THE CASE OF ACIT V/S VINOD SHA RMA (SUPRA) WHEREIN SIMILAR ISSUE RELATING TO ADDITION OF RS.34 ,50,000/- HAS CAME UP FOR ADJUDICATION BEFORE THE CO-ORDINATE BE NCH AND THE IMPUGNED ADDITION WAS DELETED. 39. ON THE OTHER HAND DEPARTMENTAL REPRESENTATIVE V EHEMENTLY ARGUED AND SUPPORTED THE ORDERS OF LOWER AUTHORITIE S. 40. WE HAVE HEARD RIVAL CONTENTIONS AND PERUSED THE RECORDS PLACED BEFORE US AND CAREFULLY GONE THROUGH THE DEC ISION OF CO- ORDINATE BENCH IN THE CASE OF SHRI VINOD SHARMA (SUPRA) . 41. THE ISSUE RAISED THROUGH THIS GROUND NO.3 FOR A SSESSMENT YEAR 2008-09 RELATES TO UNEXPLAINED INVESTMENT OF R S.34.50 LAKHS TOWARDS PURCHASE OF LAND AT MINDORI. THERE IS AN A GREEMENT FOR PURCHASE OF LAND WHICH WAS NOT FULLY SIGNED BY ALL THE PARTIES NOR IT WAS EXECUTED OR ENFORCED. HOWEVER IN THIS ALLEGED AGREEMENT FOR PURCHASE OF LAND FEW PARTIES HAVE SIGNED AND DETAIL S OF TRANSACTION HARISH PATEL IT(SS)NOS.32 TO 38/IND/2014 46 OF RECEIVING THE CASH AS WELL AS CHEQUE IS MENTIONE D. ASSESSEE HAS NOWHERE DISPUTED THE FACT THAT CHEQUE AMOUNT WERE G IVEN AS AN ADVANCE FOR PURCHASE OF AGRICULTURE LAND ALONG WITH SHRI VINOD SHARMA AND ALL THE ADVANCED CHEQUES WERE FINALLY RE CEIVED BACK FROM THE FOUR OWNERS ON ACCOUNT OF CANCELLATION OF THE AGREEMENT. NOW THE DISPUTE RELATES TO THE CASH ADVANCE OF RS.4 4 LAKHS MENTIONED IN THE ALLEGED AGREEMENT AS WELL AS THE P AYMENT PAID TO SHRI ASHOK GOYAL RELATING TO MINDORI LAND. WE FIND THAT LD.CIT(A) CONFIRMED THE ADDITION OF RS.34.50 LAKHS OBSERVING AS FOLLOWS; 6.3 I HAVE CAREFULLY CONSIDERED THE SUBMISSION OF THE APPELLANT AND FACTS OF THE CASE. AS MENTIONED BY THE AO, DURING THE COU RSE OF SEARCH, AN AGREEMENT TO SALE ENTERED ON 22.03.2008 BY THE APPE LLANT, SHRI HARISH PATEL, AND SHRI VINOD SHARMA AS 'PURCHASERS' AND SH RI VIJIT RAJ PATNI, SHRI HUKUM CHAND, SHRI KISHORE KOTWANI AND SHRI JAW AHARLAL AS 'SELLERS' FOR THE PURCHASE OF 3 ACRES LAND (130680 SQ.FT.) SITUATED AT VILLAGE MINDORI FOR A TOTAL CONSIDERATION OF RS.2,77,04,160 /- WAS FOUND AND SEIZED. THIS AGREEMENT CLEARLY DEMONSTRATE THAT THE APPELLANT, SHRI HARISH PATEL AND SHRI VINOD SHARMA HAD PAID RS.44,0 0,000/- IN CASH AND RS.6,00,000/- BY CHEQUES TO THE SELLERS ON THE DATE OF AGREEMENT I.E. ON 22.03.2008, AS CLEARLY MENTIONED IN PARA 2 OF TH E SAID AGREEMENT. IT WOULD BE FRUITFUL TO REPRODUCE THE SCANNED COPY OF THE SAID AGREEMENT TO SALE ENTERED ON 22.03.2008 AS UNDER: HARISH PATEL IT(SS)NOS.32 TO 38/IND/2014 47 HARISH PATEL IT(SS)NOS.32 TO 38/IND/2014 48 HARISH PATEL IT(SS)NOS.32 TO 38/IND/2014 49 HARISH PATEL IT(SS)NOS.32 TO 38/IND/2014 50 FROM THE ABOVE AGREEMENT, IT IS EVIDENTLY CLEAR THA T THE APPELLANT ALONG WITH SHRI VINOD SHARMA HAD ENTERED INTO AN AGREEMEN T TO PURCHASE 3 ACRES (130680 SQ.FT.) LAND SITUATED AT VILLAGE MIND ORI FOR A CONSIDERATION OF RS.2,77,04,160/- ON 22.03.2008. IT CAN BE SEEN T HAT THIS AGREEMENT WAS DULY SIGNED ON BEHALF OF THE SELLERS BY SHRI VI JIT RAJ PATNI AND SHRI HUKUM CHAND AND ON BEHALF OF THE PURCHASERS BY SHRI VINOD SHARMA. THUS, THE CONTENTION 'OF THE APPELLANT THAT THE AGR EEMENT WAS NOT DULY SIGNED IS NOT CORRECT. FROM THE AGREEMENT IT-IS EVI DENTLY CLEAR THAT THE APPELLANT SHRI HARISH PATEL AND SHRI VINOD SHARMA H AD PAID RS.44,00,000/- IN CASH (RS.11,00,000/- TO EACH SELL ER) AND ALSO PAID 4 CHEQUES OF RS.1,50,000/- EACH TO ALL THE FOUR SELLE RS. THUS, THIS DOCUMENT CLEARLY DEMONSTRATE THAT THE APPELLANT SHR I HARISH PATEL AND SHRI VINOD SHARMA HAD PAID IN CASH RS.44,00,000/- A ND THE BALANCE HARISH PATEL IT(SS)NOS.32 TO 38/IND/2014 51 PAYMENT OF RS.6,00,000/- WAS MADE BY FOUR CHEQUES O F RS.1,50,000/- EACH ON 22.03.2008. IT IS ALSO RELEVANT TO NOTE THA T THE CHEQUES ISSUED BY THE APPELLANT AND SHRI VINOD SHARMA HAD BEEN ENCASH ED BY THE PURCHASERS. THEREAFTER THE TRANSACTION DID NOT MATE RIALIZE AND THE AMOUNT PAID BY THE APPELLANT AND SHRI VINOD SHARMA WERE RETURNED BACK BY THE SELLERS. THE APPELLANT HAD RECEIVED BAC K THE THREE CHEQUES OF RS.1,50,000/- EACH ON 29.07.2008, 01.08.2008 & 08.0 8.2008. THIS CLEARLY ESTABLISHES THAT THE CONTENTS OF THE AGREEM ENT ENTERED ON 22.03.2008 WERE TRUE AND THE TRANSACTIONS AS MENTIO NED IN THE AGREEMENT HAD ACTUALLY TAKEN PLACE. THE VERY FACT T HAT THE CHEQUES MENTIONED IN THE AGREEMENT WERE DULY RECEIVED BY TH E SELLERS AND ENCASHED BY THEM GOES TO PROVE THAT THE AMOUNT SHOW N TO BE PAID IN CASH WAS ALSO ACTUALLY PAID BY THE PURCHASERS I.E. THE APPELLANT AND SHRI VINOD SHARMA TO THE SELLERS AS PART PAYMENT. THUS, THE APPELLANT AND SHRI VINOD SHARMA HAD ACTUALLY PAID RS,44,00,000/- IN CASH ON 22.03.2008 TO THE SELLERS I.E. RS.11,OO,OOO/- EACH TO SHRI VIJIT RAJ PATNI, SHRI HUKUM CHAND, SHRI KISHORE KOTWANI AND S HRI LAWAHARLAL. FURTHER, AS MENTIONED BY THE AO IN THE ASSESSMENT O RDER, THE PURCHASERS HAVE ALSO MADE PAYMENT OF RS.25,00,000/- THROUGH SHRI ASHOK GOYAL IN CASH AS ADMITTED BY SHRI VINOD SHARM A IN HIS STATEMENT THAT RS.25,00,000/- WAS PAID TO SHRI ASHOK GOYAL AS PART PAYMENT ON ACCOUNT OF TRANSACTION OF MANDORI LAND. THIS FACT W AS ALSO SHOWN IN LOOSE PAPERS SEIZED AS PAGE NO. 39 OF LPS- 3/20. TH US, THE APPELLANT AND SHRI VI NOD SHARMA HAD MADE TOTAL CASH PAYMENTS OF RS.69,00,OOO/- (RS.44,00,000 + RS.25,OO,000) FOR THE TRANSACTION O F PURCHASE OF 3 ACRES (130680 SQ. FT.) OF LAND AT VILLAGE MANDORI. HERE I T MAY ALSO BE MENTIONED THAT THE PROVISIONS OF SECTION 292C PROVIDES THAT W HERE ANY BOOKS .OF ACCOUNT OR OTHER DOCUMENT IS FOUND IN THE POSSESSIO N OR CONTROL OF ANY PERSON IN THE COURSE OF SEARCH, IT MAY BE PRESUMED THAT THE CONTENTS OF SUCH BOOKS OF ACCOUNT AND OTHER DOCUMENTS ARE TRUE. THUS, EVEN IF, IT IS HARISH PATEL IT(SS)NOS.32 TO 38/IND/2014 52 CONSIDERED THAT THE TRANSACTION FOR PURCHASE OF LAN D AT VILLAGE MANDORI DID NOT FINALLY MATERIALIZE AND THE AMOUNTS PAID IN LIEU OF THE SAID AGREEMENT WERE RETURNED BY THE SELLERS TO THE APPEL LANT AND SHRI VINOD SHARMA, THE FACT REMAINS THAT INITIALLY THE APPELLA NT AND SHRI VINOD SHARMA HAD ACTUALLY MADE PAYMENT IN CASH AS WELL AS CHEQUES TO THE SELLERS AS MENTIONED IN THE AGREEMENT AND OTHER DOC UMENT. SINCE, THE SOURCE OF PAYMENT OF RS.69,00,OOO/- REMAINED UNEXPL AINED, THE AO HAD RIGHTLY TREATED THE UNEXPLAINED INVESTMENT OF T HE APPELLANT AT RS.34,50,000/- (50 % OF RS.69,00,000/-) AS HIS SHAR E IN THE TRANSACTION OF PURCHASE OF 3 ACRES LAND AT VILLAGE MANDORI. THU S, THE ADDITION OF RS.34,50,000/- MADE BY THE AO IS CONFIRMED 42. FROM PERUSAL OF THE FINDING OF LD.CIT(A) AS WEL L AS THE SALE LETTER AGREED TO HAVE BEEN ENTERED BETWEEN THE FOU R CO-OWNERS OF 3 ACRES OF LAND AT MINDORI AND THE PURCHASER NAMELY S HRI VINOD SHARMA AND SHRI HARISH PATEL, AT PAGE-2 AT PARA-2 O F THE SALE AGREEMENT REPRODUCED ABOVE AT PAGE 47 TO 50 THERE I S A MENTION OF FIVE TRANSACTION OF WHICH FIRST IS OF CASH PAYMENT OF RS.11 LAKH EACH TO THE FOUR OWNERS TOTALING TO RS.44 LAKHS, THE REM AINING AMOUNT OF RS.5 LAKHS IS DIVIDED INTO FOUR PARTS GIVEN BY CHEQ UE AT RS.1.50 LAKHS EACH TO THE FOUR CO- OWNERS. THIS DOCUMENT H AS BEEN SIGNED BY TWO OF THE CO-OWNERS NAMELY SHRI VIJIT RAJ PATNI AND SHRI HUKUMCHAND AND ONE OF THE PURCHASER SHRI VINOD SHA RMA. HARISH PATEL IT(SS)NOS.32 TO 38/IND/2014 53 THOUGH THIS SALE AGREEMENT IS NOT REGISTERED AND NO T SIGNED BY ALL THE PARTIES, HOWEVER IN OUR CONSIDERED VIEW THIS CA NNOT BE TREATED AS DUMP DOCUMENT BECAUSE THE TRANSACTION OF THE ADV ANCE CHEQUE HAS BEEN CONFIRMED BY ALL THE FOUR PERSONS THROUGH AN AFFIDAVIT MENTIONING THAT THEY HAVE RETURNED THE ADVANCE AMOU NT. IN OUR VIEW WHEN ONE PART OF THE ALLEGED ADVANCE PAYMENT T HROUGH ACCOUNT PAYEE CHEQUE IS GENUINE AND FOUND TO BE COR RECT THEN THE ANOTHER PART MENTIONED ON THE SAME DOCUMENT OF GIVI NG ADVANCE IN CASH CANNOT BE IGNORED. THERE IS A CLEAR EVIDENCE ON RECORD THAT CASH ADVANCE OF RS.44 LAKH I.E. RS.22 LAKH EACH BY SHRI VINOD SHARMA AND SHRI HARISH PATEL HAS BEEN GIVEN TO THE FOUR CO-OWNERS. BURDEN OF PROOF WAS ON THE ASSESSEE TO EXPLAIN ABOU T THE SOURCE OF SUCH CASH ADVANCE. NOWHERE DURING THE COURSE OF ASS ESSMENT PROCEEDINGS, THE ASSESSEE HAS BEEN ABLE TO EXPLAIN AND IT HAS MERELY TAKEN A PLEA THAT THE ALLEGED DOCUMENT IS DU MP AND HAS NO LEGAL SANITY. HOWEVER WITH REGARD TO THE PAYMENT O F RS.25 LAKHS TO SHRI ASHOK GOYAL REVENUE AUTHORITIES ARE UNABLE TO BRING ANY OTHER EVIDENCE ON RECORD TO PROVE THE CONNECTION OF SHRI ASHOK GOYAL WITH THE ALLEGED TRANSACTION OF PURCHASE OF PROPERTY. HARISH PATEL IT(SS)NOS.32 TO 38/IND/2014 54 43. LD. COUNSEL FOR THE ASSESSEE HAS PLACED HEAVY R ELIANCE ON THE DECISION OF CO-ORDINATE BENCH IN THE CASE OF SHRI V INOD SHARMA (SUPRA ) WHEREIN SIMILAR ISSUE ON THE SAME FACTS RELATING TO ADDITION OF RS.34.50 LAKHS WAS ADJUDICATED AND THE ADDITION WAS DELETED. FROM PERUSAL OF THE ORDER OF THE CO-ORDINATE BENCH WE FIND THAT IN PARA 17 OF THE ORDER THE TRIBUNAL WHILE REFERRING T O THE ALLEGED SALE AGREEMENT MENTIONED THAT THE AFOREMENTIONED AGREEMENT WAS NOT SIGNED BY THE OTHER PARTIES NOR WAS IT EXECUTED OR ENFORCED. WE RESPECTFULLY SUBMIT THAT A MATERIAL FACT SEEMS TO H AVE ESCAPED THE KIND ATTENTION OF THE CO-ORDINATE BENCH BECAUSE THE ALLEGED SALE LETTER HAS BEEN SIGNED BY TWO OF THE PROPOSED SELLE RS NAMELY SHRI VIJIT RAJ PATNI AND SHRI HUKUM CHAND AND ONE OF THE BUYER SHRI VINOD SHARMA WHICH MAKES IT AMPLY CLEAR THAT A TRAN SACTION CERTAINLY TOOK PLACE WHEREIN CASH ADVANCE OF RS.44, 00,000/- WAS PAID TO FOUR CO-OWNERS BY THE TWO BUYERS ALONG WITH ISSUING FOUR CHEQUES OF RS.1,50,000/- EACH. AS THE INCOME TAX A PPELLATE TRIBUNAL IS THE LAST FACT FINDING BODY, WE RESPECTF ULLY DECLINE TO FOLLOW THE FINDING OF THE TRIBUNAL IN THIS ISSUE RE LATING TO ADDITION OF UNEXPLAINED CASH INVESTMENT OF RS.34.50 LAKHS AS TH E FACTS DISCERNABLE FROM RECORDS CLEARLY SHOWS THAT THERE W AS CASH ADVANCE HARISH PATEL IT(SS)NOS.32 TO 38/IND/2014 55 OF RS.44 LAKHS GIVEN JOINTLY BY SHRI VINOD SHARMA A ND SHRI HARISH PATEL AND WE FURTHER HOLD THAT THE ALLEGED SALE LET TER IS NOT A DUMP DOCUMENT AS IT CONTAINS DETAILS OF CHEQUE ISSUED BY THE ASSESSEE AND THE OTHER BUYER SHRI VINOD SHARMA GIVEN TO THE FOUR CO-OWNERS OF THE LAND AND THE SAME WERE RETURNED BACK ON ACCO UNT OF CANCELLATION OF THE DEAL. WE ACCORDINGLY CONFIRM TH E ADDITION OF RS.22,00,000/- AND PARTLY ALLOW GROUND NO.3 RAISED BY THE ASSESSEE FOR ASSESSMENT YEAR 2008-09. 44. IN THE RESULT ALL THE APPEALS OF THE ASSESSEE F OR ASSESSMENT YEAR 2003-04 TO 2008-09 ARE PARTLY ALLOWED. THE ORDER PRONOUNCED IN THE OPEN COURT ON 02.01.201 9. SD/- SD/- ( KUL BHARAT) (MANISH BORAD) JUDICIAL MEMBER ACCOUNTANT MEMBER / DATED : 2 ND JANUARY, 2019 /DEV COPY TO: THE APPELLANT/RESPONDENT/CIT CONCERNED/CIT (A) CONCERNED/ DR, ITAT, INDORE/GUARD FILE. BY ORDER, ASSTT.REGISTRAR, I.T.A.T., INDORE