Assistant Commissioner Of Income Tax, SATNA V. Shri Arun Bansal,

ITSSA 55/JAB/2013

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 1104 (ITAT-JABALPUR)
• Duration Of Justice: 5 year(s) 10 month(s) 6 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 28-05-2019
• Appeal Filed By: Department
• Bench Allotted: DB
• Assessment Year: 2007-2008
• Appeal Filed On: 22-07-2013
• Court: TRIBUNAL
• Department Lawyers: V B SARGOR
• Assessee Lawyers: SUNIL NEMA ADVS
• Keywords: Search and seizure; Loose papers; Document seized; Documents seized

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, JABALPUR BENCH, JABALPUR BEFORE SHRI D.T. GARASIA, J.M. AND SHRI B.C.MEENA, A.M. I.T(S.S.).A.NO.55/JAB/2013 A.Y. : 2007-08 ACIT, CIRCLE SATNA VS SHRI ARUN BANSAL, MIG 3, HEDGEWAR NAGAR, REWA APPELLANT RESPONDENT PAN NO. : AFGPB8455H C.O. NO.48/JAB/2013 (ARISING OUT OF I.T(S.S.).A.NO.55/JAB/2013 A.Y. : 2007-08 SHRI ARUN BANSAL, MIG 3, HEDGEWAR NAGAR, REWA VS ACIT, CIRCLE SATNA CROSS OBJECTOR RESPONDENT -: 2: - 2 DEPARTMENT BY : SHRI V.B.SARGOR, DR ASSESSEE BY : SHRI K.P.DEWANI AND SHRI SUNIL NEMA, ADVS. DATE OF HEARING : 28 . 0 5 .201 5 DATE OF PRONOUNCEMENT : 25 . 0 6 .201 5 O R D E R PER BENCH APPEAL FILED BY THE REVENUE AND CROSS OBJECTION FIL ED BY THE ASSESSEE ARE DIRECTED AGAINST THE ORDER OF CIT( A)-28, MUMBAI, DATED 22.04.2013 FOR THE ASSESSMENT YEAR 20 07-08. 2. FOLLOWING GROUNDS HAVE BEEN RAISED BY THE REVENUE : - 1. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) ERRED IN FACTS AND IN LAW :- (I) IN DELETING THE ADDITION OF RS. 2,00,000/- MADE BY THE ASSESSING OFFICER ON ACCOUNT OF INADMISSIBLE EXPENSES. (II) IN DELETING THE ADDITION OF RS. 22,00,000/- MADE BY THE ASSESSING OFFICER ON ACCOUNT OF -: 3: - 3 ADDITIONAL PROFIT/GAINS EARNED ON TRANSFER OF VEDIKA EDUCATION SOCIETY TO RKDF, BHOPAL. 3. A SEARCH AND SEIZURE OPERATION WAS CARRIED OUT IN T HE RESIDENTIAL AND BUSINESS PREMISES OF THE BANSAL GRO UP OF CASES OF REWA U/S 132(1) OF THE INCOME-TAX ACT, 196 1, ON 23.07.2009. DURING THE COURSE OF SEARCH, THE CASH, JEWELLERY AND BOOKS OF ACCOUNT, DOCUMENTS AND NEWS PAPERS WER E FOUND AND SEIZED AS PER PANCHNAMA. DURING THE SEARC H, THE LOOSE PAPER BUNDLE NO. A/5 PAGE 1 TO 13 WERE FOUND AND ON VERIFICATION OF ANNEXURE A/1/1 TO A/1/9, IT WAS FOU ND THAT THE ASSESSEE HAS MADE VARIOUS PAYMENTS TO VARIOUS INDIV IDUALS RIGHT FROM FINANCIAL YEAR 2003-04 TO 2009-10, WHICH ARE NOT RELATABLE TO HIS BUSINESS NOR TO THE UNDISCLOSED BU SINESS OF WASTE OIL. THESE EXPENSES ARE IN THE NATURE OF BRIB ES AND ILLEGAL GRATIFICATIONS. THEREFORE, THE AO HAS DISAL LOWED THE SAME. 4. THE MATTER CARRIED TO LD. CIT(A) AND THE LD. CIT(A) DELETED THE ADDITION BY OBSERVING AS UNDER :- -: 4: - 4 8. I HAVE CONSIDERED THE FACTS OF THE CASE, SUBMISSIONS AND CONTENTIONS OF THE ASSESSEE AND THE ORDER OF THE ASSESSING OFFICER. I HAVE ALSO LOOKED INTO PHOTOCOPIES OF RELEVANT SEIZED RECORDS PRODUCED BY THE ASSESSEE. I AGREE WITH THE ASSESSEE THAT THE ASSESSING OFFICER HAS NOT GIVEN ANY WORKING AS TO HOW DID HE REACH ON THIS FIGURE OF RS. 200,000/- . NOT ONLY THIS SIMILAR ADDITIONS HAVE BEEN MADE BY THE ASSESSING OFFICER IN OTHER YEARS AS WELL ON THE BASIS OF SAME DOCUMENT, WITHOUT ANY WORKING THEREOF OR JUSTIFICATION. THE ASSESSING OFFICER HAS NO WHERE POINTED OUT AS TO WHAT ARE THE ENTRIES IN NATURE OF ILLEGAL GRATIFICATION. I HAVE SEEN THE PHOTOCOPIES OF RELEVANT SEIZED DOCUMENTS. FOR EXAMPLE PAGE 1 OF ANNEX A/1/2 SHOWS TRANSACTIONS OF 14000+3000+1200+1200+573000+427000 (BOTH CHEQUES AND CASH), BUT ALL THESE TRANSACTIONS ARE RELATING TO PURCHASE OF A -: 5: - 5 PROPERTY AND RELATES TO PURCHASE OF STAMP AND REGISTRATION EXPENSES ETC. SIMILARLY OTHER PAGES OF THIS ANNEX CONTAINS DETAILS/ENTRIES OF FEW HUNDRED RUPEES TO FEW THOUSAND RUPEES BUT APPARENTLY IT DOES NOT INDICATE THAT THEY ARE IN NATURE OF ILLEGAL PAYMENTS. WHILE I AM SAYING SO I AM NOT SAYING THAT THESE EXPENSES ARE EXPLAINED OR DISCLOSED . I AM ONLY SAYING THAT THEY DO NOT APPEAR TO BE IN NATURE PAYMENT OF ILLEGAL GRATIFICATION. COMING TO OTHER SEIZED ANNEX. A/1/4, A LL THE DETAILS APPEAR TO BE IN NATURE OF TELEPHONE NUMBERS AND IT DOES NOT SHOW ANY KIND OF PAYMENTS WHETHER LEGAL OR ILLEGAL AND WHETHER ACCOUNTED OR UNACCOUNTED. 9. IN ANY CASE THE ASSESSEE HAS OFFERED AN ADDITIONAL INCOME OF OVER RS. 59 LACS SUBSEQUENT TO SEARCH. I HAVE BEEN GIVEN TO UNDERSTAND THAT THE WORKING OF ABOVE ADDITIONAL INCOME, ALSO INCLUDES THE TRANSACTIONS OR ENTRIES APPEARING IN SEIZED ANNEX A/1/1 TO 1/1/9. IN -: 6: - 6 THESE CIRCUMSTANCES FURTHER ADDITION OF RS. 2 LACS ON ESTIMATE BASIS, ON THE BASIS OF SAME SET OF DOCUMENTS APPEARS TO BE UNJUSTIFIED. CONSIDERING THE FACTS OF THE CASE I FEEL THAT THIS ADDITION IS UNSUSTAINABLE AS NO WORKING OF THE SAME HAS BEEN GIVEN BY THE ASSESSING OFFICER AND IT APPEARS TO BE MADE PURELY ON ESTIMATE BASIS. FURTHER, EVEN FOR ARGUMENT SAKE, IF THIS ADDITION IS REQUIRED TO BE MADE, THE SAME STAND COVERED/TELESCOPED FROM THE ADDITIONAL INCOME OF RS. 119 LACS OFFERED BY THE ASSESSEE AND SEPARATE ADDITION WAS NOT REQUIRED TO BE MADE IN THIS REGARD. THEREFORE, THIS GROUND OF APPEAL OF THE ASSESSEE IS ALLOWED AND ADDITION MADE BY THE ASSESSING OFFICER IS DIRECTED TO BE DELETED. 5. WE HAVE HEARD THE RIVAL CONTENTIONS OF BOTH THE PARTIES. WE FIND THAT THE LD. CIT(A) HAS DELETED T HE ADDITION ON THE GROUND THAT THE AO HAS NOT POINTED OUT ANY ILLE GAL -: 7: - 7 GRATIFICATION ENTRIES, MOREOVER, THE LD. CIT(A) HAS VERIFIED THE SEIZED DOCUMENTS, WHICH SHOWS THE TRANSACTION OF CA SH AS WELL AS CHEQUES. THE LD. CIT(A) FURTHER HELD THAT THESE TRANSACTIONS ARE RELATING TO PURCHASE OF PROPERTY AND RELATED TO PURCHASE OF STAMP AND REGISTRY. THEREFORE, THE LD. CIT(A) HAS D ELETED THE ADDITION. DURING THE COURSE OF HEARING, THE LD. SEN IOR D.R. COULD NOT BRING ANY CONTRARY MATERIAL AGAINST THE F INDING OF THE CIT(A) . THEREFORE, THE LD. CIT(A) HAS DELETED THE ADDITION. MOREOVER, THE LD. CIT(A) HAS ALSO CONSIDERED THAT T HE ADDITION OF RS. 2 LACS IS MADE ON ESTIMATE BASIS, THEREFORE, HE HAS DELETED ADDITION. OUR INTERFERENCE IS NOT CALLED FO R. 6. SECOND GROUND RELATES TO DELETION OF ADDITION OF 22,00,000/- MADE BY THE ASSESSING OFFICER ON ACCOUN T OF ADDITIONAL PROFIT/GAINS EARNED ON TRANSFER OF VEDIK A EDUCATION SOCIETY TO RKDF, BHOPAL. 7. SHORT FACTS OF THE CASE ARE THAT DURING THE ASSESS MENT PROCEEDINGS, IT WAS FOUND THAT THE ASSESSEE HAS CON STRUCTED GROUND FLOOR BUILDING VEDIKA COLLEGE PRIOR TO ITS T RANSFER TO RKDF GROUP AND SOME PART OF THE CONSTRUCTION WAS INCOMPLETE ON THE DATE OF SEARCH. THE GOVERNMENT AP PROVED -: 8: - 8 VALUER HAS ESTIMATED THE COST OF CONSTRUCTION AT RS . 1,43,99,500/-. THE APPROVED VALUERS REPORT WAS NOT SUPPORTED BY ANY DOCUMENTARY EVIDENCE. IN THESE CIRCUMSTANCES, THE AO HAS WORKED OUT THE COST OF CONSTRUCTION FROM THE LOOSE PAPERS AND THE NARRATIO N THEREIN. THE MANAGEMENT HAS SHOWN THE AMOUNT OF RS. 3.58 CRO RES AND THE ASSESSEE HAS SHOWN THE AMOUNT OF RS. 2.53 C RORES ONLY. THE DIFFERENCE OF RS. 1.05 CRORE AGAINST WHIC H THE ASSESSEE SURRENDERED THE INCOME OF RS. 84 LAKHS. TH EREFORE, RS. 22 LACS WAS ADDED TO THE INCOME OF THE ASSESSEE . 8. THE MATTER CARRIED TO LD. CIT(A) AND THE LD. CIT(A) HAS DELETED THE ADDITION OBSERVING AS UNDER :- 11. I HAVE CONSIDERED THE FACTS OF THE CASE AND SUBMISSIONS OF THE ASSESSEE. SINCE THE ASSESSEE HAS OFFERED AND ADDITIONAL INCOME OF OVER RS. 84 LACS, SUBSEQUENT TO SEARCH ON ACCOUNT OF OMISSIONS AND COMMISSIONS. THEREFORE, I HOLD THAT ANY POSSIBLE GA IN TO THE ASSESSEE ON ACCOUNT OF TRANSFER OF VEDIKA EDUCA TION SOCIETY STAND COVERED BY ADDITIONAL INCOME OF RS. 8 4 LACS -: 9: - 9 OFFERED BY THE ASSESSEE AND THEREFORE SEPARATE ADDI TION OF RS. 22 LACS IS NOT WARRANTED. THE SAME IS, THEREFOR E, ORDERED TO BE DELETED. 9. WE HAVE HEARD THE RIVAL CONTENTIONS OF BOTH THE PARTIES. LOOKING TO THE FACTS AND CIRCUMSTANCES OF THE CASE, WE FIND THAT THE LD. CIT(A) HAS HELD THAT EDUCATION ACTIVITIES WAS TRANSFERRED FOR CONSIDERATION OF RS. 3.25 CRORE S, WHICH IS PART OF SEIZED RECORDS AND ASSESSEE HAS SURRENDERED RS.84 LACS FOR LOOSE PAPERS. THE ASSESSEE HAS ADMITTED RS . 84 LACS, THEREFORE, THE SEPARATE ADDITION OF RS. 22 LACS IS NOT REQUIRED, AS THERE WAS NO EVIDENCE. THEREFORE, THE LD. CIT(A) HAS DELETED THE ADDITION. OUR INTERFERENCE IS NOT CALLED FOR. 10. IN THE RESULT, THE DEPARTMENTS APPEAL IS DISMISSED . -: 10: - 10 11. CROSS OBJECTION FILED BY THE ASSESSEE IS MERELY IN SUPPORT OF THE APPEAL. THE CROSS OBJECTION IS DISMI SSED AS IT IS SUPPORTIVE. 12. IN THE RESULT THE REVENUES APPEAL IS DISMISSED AND THE CROSS OBJECTION IS ALSO DISMISSED. THIS ORDER IS PRONOUNCED IN ACCORDANCE WITH RULE 34 (4) OF I.T.A.T. RULES, BY PUTTING THE COPY OF THE SAME ON NOTICE BOARD ON 25 TH JUNE, 2015. SD/- (B. C. MEENA) ACCOUNTANT MEMBER SD/- ( D.T.GARASIA) JUDICIAL MEMBER DATED : 25 TH JUNE , 2015. CPU* 176 -: 11: - 11